By Ann Roosevelt

Congressional budget cuts amounting to more than $789 million between fiscal year 2006 and FY 2008 have resulted in an Acquisition Program Baseline Schedule breach for the Army’s major modernization program–Future Combat Systems (FCS).

Last week, Army Secretary Pete Geren was briefed by service program officials on the breach, which means that key program milestones will see a schedule slip of greater than six months, Defense Daily has learned. The program is managed by Boeing [BA] and SAIC [SAI].

The Army currently is working to find ways to reprogram $78 million of the $228 million FCS FY ’08 budget reduction to ensure that the closely watched Non-Line-of-Sight-Cannon initial production systems are delivered according to the congressionally mandated schedule. The service also wants to keep the FCS Spin Out 1 Milestone C on schedule. Spin Out 1 is the Army’s first evaluation of mature FCS technologies that could be fielded early for the current force.

Other key slips include the FCS System of Systems Preliminary Design Review delayed eight months to April 2009 and the Milestone C decision postponed seven months until April 2013. The initial operational capability slips a year to 2015 and the full operational capability is delayed to August 2017.

“FCS is a commitment, not an option,” an Army memorandum said, because FCS is the Army effort to provide its soldiers the best equipment and technology as soon as practical.

This program adjustment is the fourth since the Milestone B review in May 2003.

Until now, FCS Lead System Integrators have consistently reported the program to be on cost and on schedule even through earlier congressional cuts by squeezing out all potential wiggle room.

On Feb. 7, a senior Army budget official said despite budget pressures, the Army can afford FCS.

“When FCS gets to its peak production years, I think we’re at about $8 billion a year or so, and that represents about a quarter of the Army’s [research, development acquisition] RDA account…I think that’s affordable,” Lt. Gen. David Melcher, military deputy for budget, told the Association of the United States Army Institute for Land Warfare breakfast Feb. 7.

“If we are able to remain at a level of funding that you see before you…as I look out at the five-year defense plan, it doesn’t continue to grow by leaps and bounds, it sort of levels off, though it grows a little,” he said. “If you look at the procurement accounts between research development and acquisition, it’s about $34 billion-$35 billion range.”

Melcher said he believes the Army can afford to have a quarter of its RDA account committed to the FCS program with the other three-quarters obligated to other things the service needs to build and recapitalize the modular formations.

“We should not lose sight of the fact that no service wants to mortgage their future in order to pay today’s bills,” he said. The military must prepare for the next fight.

“I would hope we would continue to enjoy support for FCS. I’m beginning to see, and others, the real value of what FCS represents,” Melcher said. “And we’re going to continue to, as aggressively as we can spin out those capabilities into the force, so we can put them in the hands of soldiers at the first opportunity.”

For FY ’09, the Army requested $3.6 billion for FCS, which consists of 14 manned and unmanned sensors, weapons and platforms that are networked to each other and to soldiers to significantly improve capability.

For the first time, the FY’09 budget requests $300 million for FCS production for the BAE Systems‘ Non-Line-of-Sight-Cannon (NLOS-C) and equipment for the first spin out equipment being evaluated for the current force this year.

Members of the Senate Armed Services Committee Feb. 6 closely questioned Defense Secretary Robert Gates on whether the Army can afford to grow the force.

Discussing the funding constraints facing the Army, Gates said the FCS program would be “one we will have to look at carefully” (Defense Daily, Feb. 7).

On Feb. 7, Rep. John Murtha (D-Pa.), who chairs the defense panel of the House Appropriations Committee, also took the FCS program to task, saying: “One of the reasons that I have said over the years is that FCS is not a good idea is because I didn’t see any way it could be funded.”

He recently talked to FCS officials at Ft. Bliss, Texas, where the Army Evaluation Task Force is working with the first of the mature FCS technologies, and said he became convinced that there are advantages to FCS–like the common chassis, which would save on maintenance costs.

“But I said to the Army, you’ve got to find ways to cut something out if you’re going to buy this. You can’t have it all.”

Melcher said in fiscal year 2008, if the pending half of the supplemental appropriation for the war is approved by Congress, adding the base budget request and the supplemental would mean the Army would spend somewhere between $250 billion and $260 billion–in FY ’08.

“That presumes the level of commitment of the force that we have this year, which includes 15 brigade combat teams, their enablers and, the surge on top of that,” he said. That represents the surge capacity in FY ’08.

“I can’t predict what the level of demand is going to be over the future years,” he said. “If you talk about $250 billion-$260 billion a year, you presume a certain level of demand, probably on the order of 15 brigade combat teams and all the enablers and continuing out to the foreseeable future for two, or three or four years. I don’t think anybody can make that prediction.”

Melcher, who’s examined the Army base budget and program objective memorandum for six years in succession, said that most of the supplemental funding, for him, is almost a pass through.

“For every dollar the Army gets in supplemental funding, about 70 percent is purely consumed in the cost of people that are deployed and the cost of operations in theater,” he said. “About 15 percent of every dollar is going to pay for reset…and then that last 15 percent is, at least in this past year, going to fill up some of those gaps we have in our formations in the Army and to the enhance the readiness of the next to deploy units that are going somewhere down the line.”