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Odierno: Army Faces $19B In Readiness Cuts; CH-47 MYP At Risk

Posted by Sydney J. Freedberg Jr. on

[CORRECTED with revised data from Army] CRYSTAL CITY: If Republicans and Democrats can’t come to terms, the combination of sequestration, a year-long Continuing Resolution, and reduced Overseas Contingency Operation (OCO) funding will slam Army readiness accounts by $17 billion to $19 billion, Chief of Staff Gen. Ray Odierno said this morning.

All told, he said, the legislative impasse puts at risk everything from military training to family support, from the civil service workforce to weapons programs like the multi-year procurement of the CH-47F Chinook helicopter.

“If we do not have a legislative solution that provides our leaders with the time and the flexibility to shape our force for the future, we will create a hollow force,” Odierno said at an Association of the US Army breakfast. “We’ll very quickly go to extremely low levels of readiness in the next six months throughout the Army.”

Media and congressional attention has been on the automatic cuts scheduled to occur in March under the sequester, which Odierno estimated as taking a “$6 billion-plus” bite from various Army accounts. But Odierno noted that if Congress fails to pass a proper appropriations bill and instead just extends the current continuing resolution for the rest of the fiscal year — as is increasingly likely — that takes another $6 billion out of operations and maintenance (O&M) specifically.

Because the CR simply tells the government to continue spending at prior-year levels, not allowing it to start new programs or reallocate money between existing ones, it fails to reflect what the Army actually needs this year, providing too much in some areas but not enough in others. “We’re not able to move money around under the continuing resolution,” said Odierno, “[so] we’re over-subscribed in one part of the budget, we’ve under-subscribed in another.”

On top of that, “there’s also uncertainty with regards to amount the overseas contingency funding we have,” which largely goes to current combat operations in Afghanistan and elsewhere, said Odierno. “We believe we have a potential [$5-$7] billion shortfall…in our OCO accounts for fiscal year ’13.”

“So the Army’s facing about $17 billion dollars worth of shortfalls,” the Chief of Staff summed up. [An Army spokesperson later clarified that the cuts could total as much as $19 billion, depending on the final tally for OCO].

Like the other services, the Army is already beginning to cut costs in anticipation of a sequester and a year-long CR, including an immediate freeze on civilian hires.

“So far… we don’t have anything that’s irreversible,” Odierno told Breaking Defense when I accosted him coming off the stage. Army readiness spending doesn’t face the same legal roadblock as Navy O&M, where putting a ship in for new maintenance “availability” in port technically counts as starting a new program and is therefore forbidden under a continuing resolution.

Where the CR’s prohibition on new starts hurts the Army is on the acquisition side, with “some multi-year programs we want to start such as CH-47 and a few others,” Odierno told AOL. “So those are somewhat at risk, but we’re trying to work that” — presumably by getting Congress to write an exception into the CR language — and “we’ll be able to resolve that, probably.”

“Immediately in ’13 our most significant issue is readiness,” Odierno told the audience as a whole, “but as we get ready to build the next POM [program objective memorandum, the Pentagon’s long-term funding plan], we have to look at reducing across all our accounts.”

“If sequestration happens we’re going to have to revisit revise every program,” he told reporters after the public talk. “All bets are off.”

Already, for example, the Army has had to take on some additional “prudent risk” with its flagship Ground Combat Vehicle program, intended to replace the aging and vulnerable M2 Bradley troop carrier. It will extend the current technology development phase by six months, but then immediately select a single design, instead of having General Dynamics and BAE build dueling prototypes as originally planned. It’s an ironic expedient given Pentagon acquisition chief Frank Kendall’s emphasis on fostering competitive prototyping (a key part of the “Better Buying Power” initiative) to keep costs down long term, but in the short term the Army couldn’t afford to keep two competitors.

“I’m still confident,” Odierno said of GCV, “[but] probably we incur a bit more risk in the program as we lose the competition a bit earlier than we wanted to.”

The Army issued general guidance on a host of further cost-cutting measures on Jan. 16, and “we expect to have those details in the next week,” Odierno said.

The service aims at savings of “at least” 30 percent in installation funds to run Army bases: It will protect programs that support wounded warriors, Odierno said, but family support will suffer with everything else. (While the military personnel accounts that pay military salaries are exempt from sequestration, programs ranging from healthcare to childcare to military schools are paid out of O&M accounts, which will be cut).

The Army will prioritize training and equipment for units bound for Afghanistan — where US forces are stretched increasingly thin — and for those in South Korea — the frontline with the nuclear rogue state to the North and a linchpin of America’s Pacific presence. It may have to cut funding for the 82nd Airborne Division’s “ready brigade” at Fort Bragg, which responds to crises worldwide. Training, supplies, and equipment across the rest of the Army will suffer. Wargames at the Combat Training Centers (CTCs) will probably be cancelled for many units not headed to Afghanistan. Army depots will have to slow work to overhaul (or “reset”) equipment worn out in Afghanistan and Iraq, building up a backlog whose effects may cascade through Army units for years.

“Once you start these delays, it will take you longer and longer and longer to catch up,” Odierno said, “so this won’t be just a ’13 readiness issue, it’ll be a readiness issue that goes into ’14 and ’15.

“For years we’ve said ‘No more Task Force Smiths,'” Odierno said, invoking the ill-prepared, ad hoc unit overrun by North Korean forces in 1950, the formative trauma of the post-World War II Army. “We are headed probably for the largest Task Force Smith I’ve ever been associated with.”

Corrected and updated at 1:00 pm with revised and clarified data from the Army.

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