National Guard to Receive Largest Budget in History.

The U.S. National Guard is set to receive its largest budget ever--$15.2 billion--in fiscal year 2001. This is significant, said officials, since the Guard is to play a more active role in the national security arena.

The Guard plans to focus its attention and dollars on modernizing an aging helicopter fleet and providing better training to its members should they be called upon in war-fighting or peacekeeping operations. All of the U.S. military services are gearing up for the 2001 Quadrennial Defense Review (QDR), where national security priorities will be established for the next four years. National Guard leaders are hoping that the QDR will take into account the growing participation of Guard members in military conflicts.

"As we prepare ourselves for the Quadrennial Defense Review 2001, I want to make sure the Guard can continue to be there when we are called," said Lt. Gen. Russell C. Davis, chief of the National Guard Bureau, in a speech to the National Guard Association of the United States at its annual convention, in Atlantic City, N.J.

"I mean to insure that we are given relevant and meaningful missions, both federal and state. I want the resources to do those missions--modern tools to do our job, that are interoperable with our active component partners," said Davis. "And I want the Guard to have a role in the decision-making process as a full partner. If we can do that, then we will insure our future."

President Clinton, in late October, signed the National Defense Authorization Act for Fiscal Year 2001, which allocates $309.9 billion to the Pentagon. This includes a 3.7 percent military pay raise, which goes into effect January 1, 2001. That means a pay hike for the more than 350,000 men and women in the Army National Guard and the 108,000-plus Air National Guard members.

The $15.2 billion National Guard budget is $1.5 billion higher than Clinton's original request and 11 percent more than the Guard's current budget. The Army Guard's portion will be $8.8 billion, and the Air Guard's share will be $6.1 billion. Procurement and modernization are major drivers for the increase. The Army Guard is expecting a 28 percent increase in procurement, while the Air Guard plans a 145 percent increase.

The authorization provides $206 million for 18 Blackhawk helicopters--16 basic models and two air ambulances--to be purchased by the Army National Guard. The UH-60 Blackhawk, manufactured by United Technologies Sikorsky Aircraft, is a staple in the Army National Guard's fleet. In addition to acquiring newer Blackhawk models, the Guard is hell-bent on modernizing its current fleet.

Sikorsky currently is refurbishing the Guard's UH-60A Blackhawk models, so that they meet 1989 production standards. The Guard has been plagued by having to train with older equipment, officials complained. But Army Chief of Staff Gen. Eric Shinseki's plans to "cascade" newer helicopters to the Guard, he said, are welcome by guardsmen.

Shinseki told the convention of his plan to align eight Guard combat units with Army active-duty forces (National Defense, November 2000, p.98). This is important, some officials said, because the Army is behind the other services in staffing all its units.

"[The Army], in comparison to the other services, [is] way behind on full-time manning," said Gen. John W. Hendrix, commanding general of the U.S. Army Forces Command. "Essentially, the Air Force and the Navy are 100 percent manned, almost virtually 100 percent manned on their full-time support requirements. And ... we in the Army are way, way behind. We simply have to get it right. ... We need more people."

The Guard recently participated in peacekeeping, disaster-relief and counterdrug programs. Earlier this year, Guard units were dispatched to help fight the outbreak of wildfires that erupted in the West. This realignment, however, will give Guard combat units a higher profile, officials said.

Davis had positive words regarding Shin-seki's realignment: "It is so important to apply this tremendous resource that these soldiers represent in a way that is relevant for our nation," he said. "I am talking about missioning our National Guard divisions. There is no question in my mind that if we can focus our divisions and enhanced brigades to a mission, it can only improve our readiness and our training. We will provide an expanded capability to the Army that will far exceed its modest cost. Missioning the Guard will remove one of the few remaining barriers to full integration on the Army team."

With the realignment comes the need for more up-to-date systems that support the service's "train like we fight" mantra. The National Guard has been training with older systems such as UH-1 Huey helicopters, officials said.

Shinseki pledged that the Guard will be equipped with 122 UH-60 Blackhawk helicopters and 68 AH-64 Apache attack helicopters by 2002.

The Air National Guard is experiencing similar problems with aging aircraft. Charles T. Robinson, commander-in-chief of the U.S. Transportation Command, told the convention that the Air Mobility Command is operating with five of the six oldest aircraft in the inventory--KC-135, C-5, C-141, C-130, C-5A. The Air Mobility Command, he said, relies heavily on the Air Force Reserve and Air National Guard. In fact, 80 percent of the C-130 Hercules fleet is in the Guard and Reserve, said Robinson.

Robinson said the Air Mobility Command must standardize its KC-135 tanker fleet and estimated that the cost to convert 100 KC-135E models would be $2 billion.

Despite its need for modernized systems, the Guard has not been deterred from carrying out many of its primary functions, officials said, particularly in the counterdrug arena.

Davis had strong words for those critics of the Guard who do not think it plays a significant role. "Is the Guard sitting on its hands? Our counterdrug program folks don't think so," he said. "Every day, over 3,000 soldiers and airmen are on duty to support drug law enforcement agencies and community-based organizations. In the last decade, they have seized over $2.2 billion in currency, 830 tons of cocaine and 4,365 tons of processed marijuana, resulting in over 671,000 arrests.

"As the world's remaining superpower, we are resented by many and face the growing prospect of asymmetric threats to our homeland. We have experienced bombings in Oklahoma and attacks at the World Trade Center. We are anticipating more threats to our security and planning ways to deal with it. This year, the National Guard will sustain the training for the original 10 Weapons of Mass Destruction (WMD) Civil Support Trams, complete with fielding of 17 additional teams initiated in fiscal year 2000, and begin the process to stand up five additional teams in fiscal year 2001. These highly trained soldiers and airmen are the tip of our spear in responding to weapons of mass destruction.

He added that the public and Congress recognize the growing need to counter the WMD threat, but insisted that WMD is just one of the Guard's many missions.

"Our first priority must be to remain as the primary first-line-ready-reserve force for defending America," said Davis. "We have and we must maintain a combat capability. We must remain a full-spectrum force. We must be, and we are a full partner on the defense team.

Some officials believe an increasing budget reflects that notion.

Other Army National Guard budget highlights include:

* $92 million for weapons and combat tracked vehicles, including Bradley conversion and additional M249 SAW machine guns and MK-19 grenade launchers.

* $84 million for additional procurement of single channel ground and airborne radio systems (SINGCARS) radios, medium weight tactical vehicles and distance learning programs.

For the Air National Guard--

* $52 million for C-40 fixed-wing aircraft to replace the D.C. Air Guard's C-22.

* $208 million for two additional C-130J Hercules transport aircraft.

* $90 million for one EC-130J psychological operations aircraft.

* $52 million for re-engining KC-135 tankers.

* $48.7 million for F-16 engines.

Past Performance Issues Stir Debate at Small Business Conference

The U.S. military services base many of their contracting decisions on the past performance of competing vendors. The bigger, more established companies that have fulfilled many contract obligations for the services most likely have an extensive track record that the Defense Department can rely upon. But what about those smaller companies that are just starting out, or those who are just starting to recognize the business opportunities available to them in the federal sector?

Many of these smaller entities have voiced concerns that, since they do not have a past performance record with the Pentagon, they are overlooked when it comes time to award a contract. But Army officials insist there are plenty of business opportunities for small, small disadvantaged, minority- and woman-owned businesses. To resolve such issues and explore prospective partnerships, Army and industry representative gathered at the 5th annual Army Small Business Conference, in McLean, Va. The conference is co-sponsored by NDIA and the Army Materiel Command (AMC).

Gen. John G. Coburn, AMC commanding general, called the past performance issue a "real-world problem."

"If you think everything is right," said Coburn, "it's not necessarily so." Coburn recognized those companies that do not have a past performance record. "Never had past performance? How do you get one?"

Some officials believe that a business's performance in the commercial sector can be indicative of its track record. "Some say go work the commercial sector," said Coburn, whose agency is the Army's top purchasing agent with $19.2 billion in annual sales. That's equivalent to $53 million each day.

One industry representative, at the conference, wondered why after receiving multiple contract awards, his company had to compete for specific task orders. This is because of changes to defense federal acquisition regulations, said an official. If a contract or multiple contracts are awarded to a business, sometimes the workload may be too burdensome for smaller companies. Task orders are then competed and awarded to a company that can get the work done, said the official. "Past performance will simplify the process in getting task orders," he asserted.

Another issue in which small businesses struggle is competing against incumbent large companies for follow-on or next-phase contracts. This means that if the Defense Department has been satisfied with a current contractor's work on a particular system, it is more difficult for another contractor to win future contracts for that system. Competitors "have to work extra hard to impress and prove [their] capability" against incumbent contractors, said Edward G. Elgart, acting deputy assistant secretary of the Army for procurement.

There will be plenty of new business opportunities at AMC as a result of upcoming work in the so-called "recapitalization" of old equipment, said Elgart.

Elgart told the conference that the Army "for the first time, [has] a clear definition of recapitalization," which involves modernizing assets and legacy systems to sustain capabilities. This entails extending service life; reducing operating and support costs; improving system reliability, maintainability and efficiency; enhancing capability, and reducing footprint on the battlefield, said Elgart. The Army has 21 initial recapitalization systems. The top three, respectively, are the M1A1/A2 Abrams tank, the AH-64AD Apache helicopters and the UH-60 Blackhawk helicopters.

Joshua A. Kutner