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Testimony: 

Before the Commission on the National Guard and Reserves: 

United States Government Accountability Office: 

GAO: 

For Release on Delivery Expected at 11:30 a.m. EDT: 

Thursday, September 21, 2006: 

Reserve Forces: 

Army National Guard and Army Reserve Readiness for 21st Century 
Challenges: 

Statement of Janet A. St. Laurent, Director: 

Defense Capabilities and Management: 

Reserve Forces: 

GAO-06-1109T: 

GAO Highlights: 

Highlights of GAO-06-1109T, a testimony before the Commission on the 
National Guard and Reserves 

Why GAO Did This Study: 

Ongoing operations in Iraq and Afghanistan have required the deployment 
of large numbers of Army National Guard and Army Reserve personnel. The 
Department of Defense (DOD) faces the unprecedented challenge of 
sustaining large-scale, long-duration operations with an all-volunteer 
military force. In addition, DOD‘s homeland defense missions have taken 
on higher priority, and National Guard forces have state 
responsibilities for homeland security activities as well as their 
traditional roles in responding to natural disasters. Over the past few 
years, GAO has examined the effects of ongoing military operations and 
domestic missions on the Army National Guard and Army Reserve. 

This statement, which draws on prior GAO work, focuses on (1) 
challenges in sustaining Army reserve component equipment and personnel 
readiness while supporting ongoing operations and (2) the extent to 
which the Army’s planned transformation initiatives will alleviate 
equipment and personnel shortages and enhance readiness. 

What GAO Found: 

The Army National Guard and Army Reserve have made significant 
contributions to ongoing military operations, but equipment shortages 
and personnel challenges have increased and, if left unattended, may 
hamper the reserves’ preparedness for future overseas and domestic 
missions. To provide deployable units, the Army National Guard and the 
Army Reserve have transferred large quantities of personnel and 
equipment to deploying units, an approach that has resulted in growing 
shortages in nondeployed units. Also, reserve units have left 
significant quantities of equipment overseas and DOD has not yet 
developed plans to replace it. The Army National Guard reports that its 
units have less than one-third of their required equipment, and the 
Army Reserve reports that its units have about half of the modern 
equipment they need to deploy. These shortages could also adversely 
affect reserve units’ ability to perform homeland defense missions and 
provide support to civil authorities in the event of natural disasters 
or terrorist attacks. The Army also faces shortages of personnel 
trained in some high-demand skills. These readiness challenges have 
occurred because the Army reserve components’ role has shifted from a 
strategic reserve force to an operational force that is being used on 
an ongoing basis. However, DOD has not fully reassessed its equipment, 
personnel, and training needs and developed a new model for the 
reserves appropriate to the new strategic environment. GAO has made 
recommendations that DOD conduct a comprehensive reassessment of 
equipment, personnel, training, and funding requirements given the 
reserve components’ shift to an operational role, but DOD’s progress to 
date in addressing them has been limited. Without a comprehensive 
reassessment of equipment and personnel policies, the Army’s reserve 
components may not be well prepared to deal with future events at home 
or abroad. 

The Army has begun two transformational initiatives intended to enhance 
reserve units’ ability to conduct 21st century operations and plans to 
spend over $24 billion for equipment over the next 5 years. These 
initiatives are significant, but the extent to which they will 
alleviate equipment and personnel challenges is unclear. The Army faces 
challenges in managing both initiatives’ costs and achieving intended 
capabilities. First, although the Army is making progress in 
transforming its forces to more flexible modular units, it has not 
provided detailed information on the capabilities, costs, and risks of 
its plans, and reserve units are likely to lack some key equipment 
items well into the future. Second, the Army is implementing a force 
generation model through which reserve units’ readiness will be 
increased as units move closer to eligibility for deployment. However, 
the Army has not fully determined the equipment, personnel, and 
training that units will require at each stage of the cycle or fully 
identified the resources to implement its plans. Without detailed 
implementation plans, decision makers will not have sufficient 
information with which to assess both DOD’s progress and performance in 
transforming the Army reserve components and whether investment 
decisions are being targeted to the highest priority areas. 

[Hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO-06-1109T]. 

To view the full product, click on the link above. For more 
information, contact Janet A. St. Laurent at (202) 512-4402 or 
stlaurentj@gao.gov. 

[End of Section] 

Mr. Chairman and Members of the Commission: 

I am pleased to be here today to discuss the work GAO has undertaken 
regarding the changing roles and readiness of the Army National Guard 
and Army Reserve. The Congress has given the Commission on the National 
Guard and Reserves (Commission) a very significant charge, and I hope 
that our work will be useful to the Commission in its deliberations on 
how reserve forces should be structured and equipped for the 21st 
century given new threats to our national security, both overseas and 
at home. Ongoing operations in Iraq and Afghanistan have required the 
involvement of large numbers of reservists, particularly ground forces, 
and the Department of Defense (DOD) now faces the unprecedented 
challenge of sustaining large-scale, long-duration operations with an 
all-volunteer military force. Since 2001, over 500,000 reservists have 
been mobilized in support of ongoing operations, the largest 
mobilization of reserve forces since World War II. The high pace of 
operations has led to personnel and equipment shortages among Army 
reserve component units. Further, in addition to its traditional 
homeland missions, such as responding to storms and fighting forest 
fires, the National Guard's homeland missions have expanded to include 
guarding against terrorist threats. 

Over the last few years, we have examined the effects of expanded 
mission requirements on the Army National Guard and Army Reserve, 
including their new operational roles in supporting both large-scale, 
long-duration overseas operations and emerging domestic requirements. 
My testimony today focuses on (1) the Army reserve components' 
challenges in sustaining equipment and personnel readiness while 
supporting ongoing military operations and (2) the extent to which 
Army's planned transformation initiatives will alleviate the Army 
reserve components' equipment and personnel shortages and enhance their 
readiness for overseas and domestic operations. 

My testimony draws upon several GAO reports related to reserve 
component personnel and equipment issues, including requirements for 
personnel with high-demand skills to support ongoing overseas 
operations. A list of these reports appears at the end of this 
statement. 

In preparing these reports, we performed extensive analysis of DOD's 
documentation on the status of Army National Guard and Army Reserve 
equipment and personnel, focusing primarily on the status of 
nondeployed units. We also reviewed and assessed DOD's and the Army's 
strategies and plans for the future including the Army Campaign Plan, 
key plans related to the Army's transition to a modular force, 
rotational force management data, equipping and funding plans, and unit 
readiness reports. We also discussed these issues with officials from 
the Office of the Secretary of Defense; the Departments of the Army and 
the Air Force; the National Guard Bureau; the Army Reserve; the Office 
of the Chairman, Joint Chiefs of Staff; and the U.S. Joint Forces 
Command. In addition, we visited selected Army National Guard units 
that had been deployed or were preparing to deploy as well as Army 
Reserve units performing homeland defense missions. This work was 
conducted in accordance with generally accepted government auditing 
standards. 

We are continuing to conduct work relating to reserve component issues, 
which will enable us to provide more information in the coming months 
on issues of interest to the Commission. For example, we have begun 
work examining reserve pay and compensation issues. We also have 
ongoing engagements examining employer support for reservists; 
emergency management assistance compacts among states; reserve 
deployment reporting; and the status of the National Guard's equipment 
for its domestic homeland defense missions and support to civilian 
authorities. 

Summary: 

The Army National Guard and Army Reserve have made significant 
contributions to ongoing military operations since September 11, 2001; 
however, equipment shortages and personnel challenges have increased 
over time and could hamper the Army's reserve components' preparedness 
for future overseas and domestic missions if left unattended. These 
readiness challenges have occurred for two primary reasons. First, the 
Army has provided resources to reserve units based primarily on the 
assumption that they would deploy overseas only in the latter stages of 
major combat operations and would receive additional resources during a 
mobilization phase. However, the Army National Guard's and Army 
Reserve's shift to more of an operational role in response to the new 
security environment has led to a situation in which the Army's 
traditional resourcing strategies for managing personnel and equipment 
may no longer be in balance with how the reserves are being used. 
Second, mobilization authorities, DOD's policies, and Army deployment 
practices limit the number and duration of reservists' deployments for 
ongoing operations so that the Army's reserve components will be 
challenged to involuntarily mobilize and deploy large numbers of 
personnel with needed skills. To provide deployable units for Iraq and 
Afghanistan, the Army National Guard and the Army Reserve have 
transferred large numbers of uniformed personnel and equipment from 
nondeployed units to deploying units. This approach has resulted in 
growing shortages among nondeployed units. Equipment shortages have 
been further compounded because DOD has required reserve units to leave 
large amounts of equipment overseas for use by other forces, and much 
of this equipment has not been replaced. As a result, the Army National 
Guard reports that units have less than one-third of their required 
equipment, and the Army Reserve currently reports that its units have 
about half of the modern equipment they would need to deploy. In 
addition to creating potential risk to the nation's ability to respond 
to unforeseen events overseas, Army National Guard and Army Reserve 
equipment shortages could also adversely affect reserve units' ability 
to perform homeland defense missions and provide support to civil 
authorities in the event of natural disasters or terrorist events. 
Moreover, under current policies, the Army is challenged to identify 
and mobilize reserve personnel in some high-demand skills. We have made 
recommendations to DOD intended to bring about a comprehensive 
reassessment of equipment, personnel, training, and funding 
requirements given the Army reserve components' shift to a more 
operational role. However, DOD's progress in implementing these 
recommendations has been limited. Unless such a comprehensive 
reassessment and rethinking of the equipment and personnel policies is 
completed--in other words, unless DOD reaches consensus on a new model 
for the reserves that matches policies and resources with the Army 
reserve components' expected missions--DOD may find itself ill prepared 
to deal with future events at home or abroad. 

The Army has recently begun two major transformational initiatives that 
are intended to improve the ability of Army Reserve and Army National 
Guard units to respond to 21st century threats; however, the extent to 
which these initiatives will help to alleviate personnel and equipment 
challenges and enhance readiness is unclear. These initiatives include 
the creation of modular units in the active and reserve components and 
the creation of a new model to manage readiness and provide reservists 
with more predictable deployment schedules. Although both these 
initiatives have some merit from a conceptual standpoint, the Army 
faces significant challenges in managing their costs, risks, and 
performance. Specifically, the Army is making progress in transforming 
its division-based structure to more easily deployable modular units, 
but it has not provided detailed plans showing the extent to which DOD 
will be able to fund new equipment required by modular units in the 
reserve components. The Army has budgeted $21 billion to improve the 
Army National Guard's equipment and $3.8 billion for the Army Reserve 
over the next 5 years; however, it has not yet provided detailed 
information about the types and amounts of equipment it will buy or 
described the extent to which this funding will provide equipment 
compatibility with the active component. Further, the Army has not 
provided sufficient information with which DOD and congressional 
decision makers can assess the capabilities, costs, affordability, and 
risks of the Army's modular force implementation plans. Because the 
need to equip units deploying overseas is likely to continue to take 
priority over nondeployed units for equipment funds, reserve units are 
likely to have shortfalls of some key equipment items well into the 
future. The Army's second major initiative is the development of a 
force generation model in which units' readiness for deployment would 
move through phases of increasing readiness as they move closer to 
deployment eligibility--once every 5 to 6 years for reserve forces. 
However, the Army has not yet developed a transparent plan for national-
level decision makers that identifies the equipment, personnel, and 
training that will be required at each phase of the model nor has it 
fully identified the resources it will need to implement its plans. We 
reported in 2005 that the Army needs to fully define how the reserve 
components will be integrated into its modular force and rotational 
cycle, and although DOD agreed with our recommendations, many questions 
remain about the risks inherent in the Army's plans.[Footnote 1] Until 
the Army completes such plans and identifies funding for its 
transformational initiatives, the reserve components' preparedness for 
future overseas and domestic missions is not likely to increase and may 
continue to erode. Moreover, unless the Army completes more detailed 
implementation plans, decision makers will not have sufficient 
information to assess both DOD's progress and performance in 
transforming the Army's reserve components and whether investment 
decisions are being targeted to the highest priority areas. 

Background: 

The Army has two reserve components, the Army National Guard and the 
Army Reserve. Both reserve components are composed primarily of citizen 
soldiers who balance the demands of civilian careers with military 
service on a part-time basis. During the Cold War, it was expected that 
the reserve forces would be a strategic reserve to supplement active 
forces in the event of extended conflict. However, since the mid-1990s, 
the reserves have been continuously mobilized to support operations 
worldwide, including those in Bosnia and Kosovo as well as operations 
in Afghanistan and Iraq. In today's strategic environment, the Army's 
reserve components have taken on a variety of different overseas 
missions as well as traditional and emerging domestic missions. 

The Army Reserve and the Army National Guard are part of the total 
Army, which also includes the active component. The Army organizes, 
trains, and equips its reserve components to perform assigned missions. 
The Army Reserve is a federal force that is organized and trained 
primarily to supply specialized combat support and combat service 
support skills to combat forces. The Army National Guard is composed of 
both combat forces and units that supply support skills. The Army 
National Guard, when mobilized for a federal mission, is under the 
command and control of the President. When not mobilized for a federal 
mission, Army National Guard units act under the control of the 
governors for state missions, typically responding to natural disasters 
and more recently protecting state assets from terrorist attacks. Using 
DOD planning guidance, the Army provides reserve units varying levels 
of resources according to the priority assigned to their federal 
warfighting missions. 

Reserve forces may be involuntarily called to active duty under three 
mobilization authorities. As shown in table 1, two authorities 
authorize the President to involuntarily mobilize forces, but with size 
and time limitations. Full mobilization, which would authorize the 
mobilization of forces for as long as they are needed, requires a 
declaration by the Congress. The Office of the Secretary of Defense 
implements the activation of reservists. 

Table 1: Mobilization Authorities for Reserve Forces: 

Statute: 10 U.S.C. 12301(a); "Full Mobilization"; 
Provisions: Declared by Congress: 
In time of war or national emergency; 
No limit on numbers of soldiers called to active duty; 
For duration of war plus 6 months. 

Statute: 10 U.S.C. 12302; "Partial Mobilization"; 
Provisions: Declared by the President: 
In time of national emergency; 
No more than 1,000,000 reservists can be on active duty; 
No more than 24 consecutive months. 

Statute: 10 U.S.C. 12304; "Presidential; Reserve Call-up"; 
Provisions: Determined by the President: 
To augment the active duty force for operational missions; 
No more than 200,000 reservists can be on active duty; 
No more than 270 days. 

Source: GAO analysis of U.S. Code provisions. 

[End of table] 

On September 14, 2001, President Bush declared that a national 
emergency existed as a result of the terrorist attacks of September 11, 
2001. On September 20, 2001, DOD issued mobilization guidance that 
among other things allowed the services to mobilize reservists for up 
to 24 cumulative months under the President's partial mobilization 
authority. The Army's current guidance is that soldiers should serve 12 
months with their "boots on the ground" in support of Operation 
Enduring Freedom in Afghanistan and Operation Iraqi Freedom in Iraq, 
not including the time spent in mobilization and demobilization 
activities, which could add several more months to the time a reserve 
member spends on active duty. 

Army Reserve Components Have Significant Equipment Shortages and 
Personnel Challenges That Hinder Readiness for Future Missions: 

The Army's reserve components have provided ready forces for ongoing 
military operations since September 11, 2001, but personnel and 
equipment challenges have led to declining readiness and hamper their 
ability to prepare for future overseas and domestic missions. A 
resourcing structure that is inconsistent with the reserve components' 
new operational role as well as limiting mobilization policies and 
practices have led to equipment and personnel shortages. These 
shortages have required nondeployed reserve units to transfer equipment 
and personnel to deploying units, further degrading readiness. In the 
absence of a major effort to reassess equipment, personnel, and 
training requirements and policies, it will become increasingly 
difficult for the Army reserve components to prepare for future 
missions. 

Reserve Components' Transfers of Equipment to Deploying Units and 
Equipment Left Overseas Exacerbate Existing Shortages: 

Two major issues that have degraded the readiness of Army reserve 
forces are (1) the transfers of equipment among units to deploy ready 
forces and (2) the significant amounts of equipment reserve units have 
left overseas. The resulting equipment shortages could adversely affect 
reserve units' ability to contribute to overseas and homeland missions. 

Transferring Equipment to Ready Deploying Units Has Degraded 
Nondeployed Units' Equipment Inventories: 

The Army National Guard and the Army Reserve currently have shortages 
in the equipment they need to train and deploy and, in the case of the 
Army National Guard, to respond to domestic emergencies. As noted 
earlier, equipment shortages exist because the Army, following DOD 
planning guidance, has historically equipped Army units, including the 
Army reserve components, according to a strategy known as tiered 
resourcing. Under the tiered resourcing strategy, units expected to 
deploy overseas first in a conflict, generally active combat units, 
receive first priority for equipment. Following this approach, the Army 
accepted some operational risk by providing lower-priority reserve 
units with less equipment than they would need for their missions, 
under the assumption that there would be time to provide additional 
equipment to them before they would be deployed. For example, the Army 
National Guard's divisions, which constitute the majority of its combat 
forces, have been maintained with about 65 percent of the equipment 
they would need to perform their missions. In addition, much Army 
reserve component equipment is older and less modern than that of the 
active Army and is not always compatible with active force logistics. 
The Army National Guard reports that units have less than one-third of 
their required equipment, and the Army Reserve currently reports that 
its units have about half of the modern equipment they would need to 
deploy. 

Despite this tiered resourcing structure, for recent operations, 
combatant commanders have required Army National Guard and Army Reserve 
units to deploy with 90 to 100 percent of the equipment they are 
expected to need and with equipment that is compatible with that of 
active Army units. To meet the combatant commander requirements for 
fully manned and equipped units, the Army National Guard and the Army 
Reserve have transferred equipment to deploying units. For example, 
when Army National Guard's 30th Brigade Combat Team from North Carolina 
was alerted to prepare to deploy to Iraq in 2004, it had only about 40 
percent of its deployment requirement of about 8,810 night vision 
goggles. The Army National Guard had to transfer about 5,272 pairs of 
goggles to fully equip the unit, leaving other units with even fewer 
goggles available for training and future missions. In another case, to 
support requirements for high-demand military police skills during 2004 
and 2005, the Army tasked the Army National Guard to convert 40 non- 
military police units, including field artillery companies, to security 
units capable of performing selected military police missions in Iraq. 
While a military police company typically has 47 humvees in its 
inventory, field artillery companies have only about 3 humvees that are 
suitable for this new mission. The Army National Guard had already 
depleted its inventory of armored humvees to prepare units that had 
deployed previously, so the converted units had to obtain armored 
humvees from other units already in Iraq. 

While transferring equipment has enabled the Army National Guard and 
Army Reserve to meet immediate needs, transfers have decreased the 
equipment available to nondeployed units for training and other 
purposes. Early transfers of equipment to deploying units created a 
cycle of additional ad hoc transfers as reserve units that had provided 
equipment to deploying forces were themselves alerted for 
mobilizations. 

In 2004, we reported that as of May of that year, the Army National 
Guard had transferred more than 35,000 pieces of equipment to ready 
units for recent operations.[Footnote 2] We subsequently reported that 
by July 2005, the number of equipment items transferred among Army 
National Guard units had grown to more than 101,000.[Footnote 3] With 
respect to some equipment items, transfers of equipment to deploying 
units have completely or almost completely exhausted the inventories of 
many nondeployed Army National Guard units. As of July 2005, the Army 
National Guard reported that equipment transfers had largely exhausted 
its inventory of more than 220 critical items, including some items 
useful to nondeployed units for training and domestic missions. Among 
the items for which the Army National Guard had shortages of over 80 
percent of the authorized inventory were chemical warfare monitoring 
and decontamination equipment and night vision goggles. 

These continuing transfers have resulted in significant declines in the 
amount of equipment available to nondeployed Army National Guard units 
since the beginning of current overseas operations. As we previously 
reported, the percentage of nondeployed units that reported having the 
minimum amount of equipment they would need to deploy[Footnote 4] 
dropped from 87 percent in October 2002 to about 59 percent in May 
2005. (See fig. 1.) However, this estimate includes units that have 
older, less modern equipment, referred to as substitute equipment. 
While these substitute items may be useful for training purposes, 
commanders may not allow these older items in the theater of operations 
because they may not be compatible with the equipment other units are 
using and cannot be sustained logistically overseas. In addition, this 
estimate includes units that have equipment that is undergoing 
maintenance after returning from deployment or was left overseas, so 
these items are not readily available for use. 

Figure 1: Percentage of Nondeployed Army National Guard Units Meeting 
Minimum Equipment Criteria to Deploy: 

[See PDF for image] 

Source: Army National Guard Data. 

[End of figure] 

National Guard officials stated that the number of Army National Guard 
units meeting the minimum criteria to deploy has continued to decline 
since our last report. The National Guard Bureau estimates that when 
substitute equipment items, equipment undergoing maintenance, and 
equipment left overseas for follow-on forces are subtracted, its 
nondeployed units had available only about 34 percent of essential 
warfighting equipment as of July 2005. Senior National Guard officials 
now estimate that the Army National Guard has less than 30 percent of 
its essential warfighting equipment. 

Like the Army National Guard, the Army Reserve is also facing problems 
resulting from equipment transfers to deploying units. According to our 
analysis, from September 2001 through April 2005, the Army Reserve 
transferred about 236,000 pieces of equipment worth about $765 million 
to fill equipment shortages among deploying units. The items most 
transferred were (1) individual equipment, such as clothing and boots; 
(2) unit equipment, such as tents, generators, and communications 
equipment; and (3) weapons. 

In the fiscal year 2007 National Guard and Reserve Equipment Report, 
the Army Reserve reported that it had about 78 percent of the equipment 
it requires, but about one-third of the equipment is obsolete and not 
interoperable with the active Army. Therefore, the percentage of 
equipment Army Reserve units have that is acceptable for deployment is 
lower than the overall figure indicates. In addition, the Army Reserve 
has reported that its equipment is aging more quickly than planned 
because of high use and a harsh operational environment. Accordingly, 
the Army Reserve has estimated that as much as 44 percent of its 
equipment needs servicing, including equipment that has been returned 
from overseas. These shortfalls in equipment that could be used to 
equip deploying forces or in training for future missions challenge the 
Army Reserve's ability to train and prepare units for future 
deployments. 

Requirement to Leave Significant Quantities of Equipment in Theater Has 
Further Decreased Equipment Available to Nondeployed Units: 

Compounding the degrading effect of equipment transfers on the 
equipment available to nondeployed reserve component units has been the 
requirement that units leave significant amounts of equipment in 
Afghanistan and Iraq for follow-on forces. In July 2005, we reported 
that Army Reserve units had been required to leave some equipment 
items, such as vehicles that have had armor added to them, which 
exacerbated shortages in equipment available for training.[Footnote 5] 
Moreover, in October 2005, we reported that the Army National Guard 
estimated it had left more than 64,000 equipment items valued at over 
$1.2 billion overseas since 2003 to be used to support ongoing 
operations.[Footnote 6] For example, when the North Carolina 30th 
Brigade Combat Team returned from its deployment to Iraq in 2005, it 
left 229 humvees, about 73 percent of its predeployment inventory of 
those vehicles, for other units to use. Similarly, according to Army 
National Guard officials, three Illinois National Guard units were 
required to leave almost all of their humvees, about 130, in Iraq when 
they rotated back from deployment. Moreover, we reported that the Army 
had not fully accounted for this equipment and had not prepared plans 
to replace it as required under DOD policy. DOD Directive 1225.6, 
Equipping the Reserve Forces, issued April 7, 2005, requires a 
replacement plan for reserve component equipment transferred to the 
active component for more than 90 days.[Footnote 7] However, according 
to Army officials, the Army did not initially track the Army National 
Guard's equipment or prepare replacement plans in the early phases of 
the war because the practice was intended to be a short-term measure 
and there were other priorities. In addition, the Army did not have a 
centralized process to track equipment and develop replacement plans. 
Instead, transfers of equipment between units were only documented at 
the unit level in unit property records. According to Army and National 
Guard officials, the Army only planned to track certain high-demand 
equipment items, such as armored humvees, that were designated to 
remain in theater for the duration of the conflict. The National Guard 
estimates untracked items, such as cargo trucks, rough terrain 
forklifts, and palletized load trucks, to be about 45 percent of all 
the items its units left overseas. 

In May 2005, the Assistant Secretary of Defense for Reserve Affairs 
noted that while the exact amount of equipment transferred between the 
reserve and active components was unknown, overall the magnitude of 
these transfers has been significant and was an area of concern. He 
requested that the Army submit a replacement plan for all Army National 
Guard equipment retained in theater by June 17, 2005. In October 2005, 
we recommended that the Secretary of Defense direct the Army to prepare 
the replacement plans required by DOD Directive 1225.6.[Footnote 8] The 
department agreed with that recommendation, but the Army still has not 
completed plans for replacing the majority of the equipment. As of June 
2006, the Army had developed some plans for replacement of Army 
National Guard equipment, but only three plans, which only covered a 
portion of the equipment the Army National Guard units left behind, had 
been approved. 

Equipment Shortages Could Adversely Affect Reserve Units' Ability to 
Contribute to Homeland Security Missions as Well as Overseas Missions: 

In addition to creating potential risk to the nation's ability to 
respond to unforeseen events overseas, Army National Guard and Army 
Reserve equipment shortages could also adversely affect reserve units' 
ability to perform homeland defense missions and provide support to 
civil authorities in the event of natural disasters or terrorist 
attacks. Until recently, it has been assumed that the National Guard 
could perform its typical state missions, such as storm relief and 
firefighting, with the equipment it had on hand for its federal 
missions. However, with the heavy use of the Army National Guard in the 
new security environment, this assumption may not be a sound one, 
especially in the event of non-traditional threats, such as chemical or 
biological attacks, or pandemic disease. Moreover, while DOD's Office 
of the Assistant Secretary of Defense for Homeland Defense and the U.S. 
Northern Command, which are charged with leading DOD's efforts in 
homeland defense, have taken some actions to plan DOD's response to 
potential threats, they have not completed developing requirements or 
preparedness standards and measures for homeland missions in which the 
National Guard may be likely to participate. We have previously 
reported that some items, such as humvees, night vision goggles, and 
chemical protective suits, which are in short supply among the Army 
National Guard's nondeployed forces, may also be extremely useful for 
responding to domestic events, including terrorism.[Footnote 9] 
Although planning for large-scale events, whether natural or man-made, 
is not complete and requirements are not fully known, it is likely that 
at a minimum, National Guard forces--under control of the states or the 
President--will be involved in responding to any large-scale threat or 
catastrophe. Hurricane Katrina, which hit the Gulf Coast in August 
2005, highlighted the Army National Guard's and DOD's key roles in 
responding to catastrophic events as over 50,000 National Guard forces, 
as well as 20,000 additional active duty military forces, participated 
in responding to the devastation the hurricane left behind.[Footnote 
10] We reported in May 2006 that many challenges that the military 
faced during Katrina pointed to the need for better plans and more 
robust exercises for disaster response and noted that without actions 
to help address planning and exercise inadequacies, a lack of 
understanding will continue to exist within the military and among 
federal, state, and local responders as to the types of assistance and 
capabilities that DOD might provide in response to a catastrophe; the 
timing of this assistance; and the respective contributions of the 
active, reserve, and National Guard forces. 

Given the National Guard's role in responding to domestic emergencies, 
in November 2004, we recommended that the Secretary of Defense (1) 
establish the full range of the National Guard's homeland missions, 
including those led by DOD and those conducted in support of civilian 
authorities; (2) identify the National Guard's capabilities to perform 
these missions and any shortfalls in personnel, equipment, and training 
that need to be addressed to perform these missions successfully; (3) 
develop a plan to address any shortfalls including identifying funding; 
and (4) establish readiness standards and measures for the National 
Guard's homeland security missions so that the readiness for these 
missions can be systematically measured and accurately 
reported.[Footnote 11] DOD agreed with our recommendations and is now 
taking a more active role in working with its federal and state 
partners to improve its ability to respond to catastrophic incidents. 
In addition, this year the Army has taken some steps to provide 
equipment to National Guard units in hurricane-prone states to 
temporarily improve their ability to respond to hurricanes. 
Specifically, the Army transferred equipment, such as trucks, 
floodlights, and night vision devices, from its active component units 
to National Guard units. Further, the Under Secretary of Defense for 
Personnel and Readiness has directed that the department begin tracking 
its readiness for some domestic missions in the new Defense Readiness 
Reporting System. 

Army National Guard and Army Reserve Face Significant Personnel 
Challenges, Especially in Some Critical Skills: 

In addition to equipment shortages, other factors have negatively 
affected Army's reserve components' personnel readiness: (1) the 
transfer of personnel among units to deploy ready forces, (2) fewer 
full-time support staff than authorized, and (3) the increasing 
difficulty of identifying trained personnel available to deploy for 
future rotations. 

Personnel Transfers among Units to Support Deployments Have Led to 
Shortages in Nondeployed Units: 

Under tiered resourcing, Army National Guard and Army Reserve units 
have generally been assigned fewer personnel than they require to 
perform their assigned missions, under the assumption that the 
shortages could be filled before the units would deploy. For example, 
the Army Reserve has been assigned about 80 to 85 percent of its 
required personnel. Additionally, some personnel assigned to units may 
not be deployable because of unfulfilled training requirements or for 
personal reasons, such as family situations or health reasons. However, 
for Operation Iraqi Freedom, the combatant commander has required that 
Army National Guard and Army Reserve units be deployed with 100 percent 
of the personnel they need for their missions. Therefore, to fill 
shortages in deploying units to support the first rotations of troops 
to Operation Iraqi Freedom in March 2003, the Army National Guard and 
the Army Reserve had to transfer personnel from units that were not yet 
alerted to deploy. Initial transfers worsened existing personnel 
shortages in non-mobilized units and increased the numbers of personnel 
that had to be transferred when additional units were subsequently 
mobilized. Moreover, transfers are continuing as reserve personnel 
continue to be deployed to support ongoing rotations to Iraq. Shortages 
of available personnel in non-mobilized units now limit their ability 
to conduct training for future missions and will require them to 
receive significant infusions of personnel from other units if they are 
alerted for mobilization. Without a comprehensive reassessment of its 
reserve staffing policies, the reserve components will have difficulty 
improving readiness. 

Requirements for Full-time Personnel to Provide Support Have Not Been 
Fully Reassessed in Light of the Army's Reserve Components' Changing 
Role: 

Another significant challenge the Army National Guard and Army Reserve 
face in continuing to provide support for ongoing operations is that 
they have not been authorized all of the full-time support staff units 
need to perform critical readiness duties at home. These personnel play 
a key role in maintaining reserve component unit readiness and 
participating in mobilization/deployment planning and preparation by 
performing the day-to-day equipment maintenance, administrative, 
recruiting and retention, and training tasks for the Army National 
Guard and Army Reserve forces. However, in accordance with the Army's 
tiered resourcing strategy, the Army's reserve components have not been 
authorized all the full-time personnel they need to be fully manned. 
For example, based on a pre-September 11, 2001, analysis, the Army 
Reserve identified a requirement for about 38,000 full-time support 
personnel, which equates to about 18.5 percent of the 205,000 members 
it is authorized by law. However, the Army Reserve is only authorized 
about 26,350 full-time support personnel, or about 68 percent of its 
requirement. The Army National Guard was authorized full-time support 
equal to only 59 percent of its full-time requirement, in contrast with 
the Air National Guard, which is staffed at 100 percent of its required 
full-time support personnel. In 2005, we recommended that the Army 
should reassess the Army Reserve's requirement for full-time staffing 
support given its new operational role, but such a reassessment has not 
yet been completed.[Footnote 12] Without sufficient full-time 
personnel, critical administrative, maintenance, and training tasks may 
not be completed in a timely manner and unit readiness may suffer. 

Identifying Trained Personnel Available to Deploy for Future Rotations 
Is Increasingly Difficult: 

As current operations have continued, under DOD's current policies, the 
Army National Guard and Army Reserve will be challenged to 
involuntarily mobilize and deploy large numbers of personnel with 
needed skills. Reservists serving in Afghanistan and Iraq have been 
activated under a partial mobilization authority that enables the 
secretary of a military department to involuntarily mobilize reservists 
for up to 24 consecutive months. Limitations imposed by DOD policies 
implementing the mobilization authority have contributed to increasing 
difficulties in identifying reserve personnel, especially personnel 
trained in some high-demand skills, to fill ongoing requirements. 

Some of the skills in highest demand for current operations are the 
combat support and combat service support skills that reside heavily or 
primarily in the Army National Guard and Army Reserve--sometimes in 
small numbers of critical personnel. Skills that are in high demand 
include military police, engineering, and civil affairs. Because so 
many of the Army reservists in these skills areas have already been 
deployed and are not eligible for future deployment under current 
policies, DOD has developed strategies, such as reassigning and 
retraining personnel from within the Army and the other services 
according to Army doctrine, to fill combatant commander requirements. 
While new recruits are constantly entering the Army Reserve and 
National Guard, training them with specialized skills, such as 
intelligence analysis, takes time. 

As we reported earlier this month, there are various options that DOD 
can consider to make more reserve personnel available for future 
rotations overseas, such as reconsidering its policy of involuntarily 
activating reservists only once for current operations, changing 
deployment durations, and transferring more positions to high-demand 
areas.[Footnote 13] Each of these options has both advantages and 
disadvantages. However, DOD has not conducted a comprehensive, data- 
driven analysis of its options. Without such an analysis, DOD will be 
challenged to plan effectively for future requirements. Moreover, the 
Secretary of Defense and the Congress will not have complete 
information on which to base decisions about the size and composition 
of the force, mobilization and deployment policies, and other issues. 

Two Major Army Transformation Initiatives Are Under Way, But Effect On 
Reserve Component Readiness Is Unclear: 

The Army has two major initiatives--the creation of modular units and 
development of a force generation model to provide more predictability 
to unit rotations--that are intended to enhance the ability of both 
active and reserve units to conduct 21st century operations; however, 
implementation plans for these initiatives are still evolving, funding 
plans lack sufficient details and could change, and the risks 
associated with the initiatives have not been clearly identified. As a 
result, the potential impact of these initiatives on the reserve 
components' sustainability as part of a 21st century operational force 
is very uncertain. Further details about how both these initiatives 
will work are critical so that national decision makers can make 
accurate assessments, manage risk, and ensure that the initiatives will 
result in a sustainable model for the reserves that will provide 
adequate levels of readiness commensurate with expected roles and 
missions of the Army National Guard and Reserves. 

Army's Plans to Transform Its Forces into Modular Brigades Face 
Significant Personnel and Equipment Challenges: 

The Army considers its modular force transformation the most extensive 
restructuring it has undertaken since World War II. Restructuring the 
Army from a division-based force to a force of modular brigades that 
are intended to be more rapidly deployable and better able to conduct 
joint operations will require extensive investments in equipment and 
retraining of personnel. The Army currently estimates this initiative 
will cost $52.5 billion, including $41 billion for new equipment. These 
funds are intended to cover the costs for equipping, training, and 
procuring new facilities for active, reserve, and National Guard units-
-including those designed for combat, support, and headquarters 
functions. The Army estimated in June 2005 that it would cost about 
$15.6 billion to convert the Army National Guard's units. 

We have given testimony that although the Army is making progress in 
creating modular units, it faces significant challenges in managing 
costs and meeting equipment and personnel requirements associated with 
modular restructuring in both the active and reserve 
components.[Footnote 14] Specifically, we have noted that it is not 
clear to what extent the Army can achieve the expected capabilities of 
the new modular units within its cost estimate and planned time frames 
for completing unit conversions. As of April 2006, the Army had not met 
its near-term equipping goals for its active modular combat brigades, 
which have traditionally been equipped at a higher level than most 
reserve component units. In both the active component and Army National 
Guard, combat brigades will initially lack some of the key equipment 
that Army force design analyses determined were essential for achieving 
their planned capabilities. This will occur because the Army's plans to 
fund new equipment for its modular force do not match the schedule for 
converting units to new modular organizational designs. 

In addition, we have also reported that the Army will face greater 
challenges in meeting its modular equipping requirements for its 28 
planned National Guard combat brigades.[Footnote 15] Army National 
Guard and Army Reserve units will start their modular conversions with 
less and much older equipment than most active units. This will add to 
the challenge the Army faces in achieving its plans and timelines for 
equipping Army National Guard units at comparable levels to active 
units. The Army plans to spend a total of $21 billion cumulatively over 
the next few years on Army National Guard equipment and $3.8 billion on 
Army Reserve equipment. However, Army National Guard officials believe 
that even after the Army's planned investment, the Army National Guard 
will have to accept risk in certain equipment, such as tactical wheeled 
vehicles, aircraft, and force protection equipment. 

In the near term, modular conversions will likely exacerbate current 
equipment shortfalls in the Army National Guard. First, according to 
current Army plans, the units are expected to convert to their new 
designs with the equipment they have on hand. However, because of 
existing shortages and the large number of equipment items that 
deployed units left in Iraq or that need repair or replacement because 
of heavy use, units will not have equipment needed for the Army's 
modular unit designs. For example, converted Army National Guard units 
initially expect to be without some equipment items that provide the 
basis for the improved capability of the new brigades, such as unmanned 
aerial vehicles, single channel ground and airborne radio systems, and 
Javelin antitank missiles. Second, although most Army National Guard 
units are scheduled to be reorganized by 2008, the Army has not planned 
funding to provide equipment to the units until 2011 at the earliest, 
and equipment for ongoing operations may continue to take priority away 
from replacing equipment of nondeployed units. The lack of detailed 
plans for equipping Army National Guard units makes it difficult to 
determine how the Army intends to transition these units from the old 
to the new organizational structure effectively. 

Moreover, our work highlighted several limitations to the Army's cost 
estimate for Army National Guard modular force conversions.[Footnote 
16] First, the estimate was based on a unit design that is less modern 
than one the Army plans to use in the near term. Second, the estimate 
does not include costs for 10 of the Army National Guard's support 
units or military construction costs associated with its 40 support 
units. Furthermore, the cost estimates assume that Army National Guard 
equipment inventories will be at prewar levels and available for 
modular conversions, which may not be a reasonable assumption given the 
large amounts of equipment that units have left overseas for which 
replacement plans have not yet been developed. Supplemental funds for 
repairing and replacing equipment worn out overseas could help improve 
reserve equipment levels; however, the amount and duration of the 
funding that might be allocated to the reserve components is uncertain. 

Equipping and Personnel Levels Associated with Army's Force Generation 
Model Are Unclear: 

The Army has adopted a new force generation model that is intended to 
improve units' readiness over time as they move through phased training 
to prepare for a potential deployment window that would occur once 
every 5 to 6 years for reserve component units. The early phases of the 
cycle would entail formation and staffing of the unit and beginning 
individual and collective training. Figure 2 illustrates the movement 
of units through reset and train, ready, and available phases. 

Figure 2: Army Proposed Force Generation Model: 

[See PDF for image] 

Source: GAO analysis of Army data. 

* The Army's force rotation model proposes that active component units 
in the Available phase will be available for deployment 1 year in every 
3 years, and reserve component units will be available for deployment 1 
year in every 6 years. 

[End of figure] 

According to Army officials, providing units increasing amounts of 
equipment as they move through the phases of the model will enable the 
Army to better allocate available equipment and help manage risks 
associated with specific equipment shortages. Under this model, three 
types of equipment sets--a baseline set, a training set, and a 
deployment set--would be provided to units as they progress through the 
cycle. The baseline set would vary by unit type and assigned mission 
and the equipment it includes could be significantly reduced from the 
amount called for in the modular brigade design. Training sets would 
include more of the equipment units need to be ready for deployment, 
but the equipment would be located at training sites throughout the 
country and units would not have immediate access to the equipment. The 
deployment set would include all equipment needed for deployment, 
including theater-specific equipment. With this cyclical equipping 
approach, the Army believes it can have up to 14 active combat brigades 
and up to 5 Army National Guard combat brigades equipped and mission 
ready at any time. 

The Army has developed a general proposal to equip both active and 
reserve units according to the readiness requirements of each phase of 
the force generation model, but it has not yet fully determined 
equipping requirements for units as they progress through the 
rotational cycles. Specifically, plans do not yet detail the types and 
quantities of items required in each phase, and the levels of equipment 
the deploying and non-deploying units would receive are currently not 
clear. Therefore, it is difficult to assess the risks or the ability of 
units in the earlier stages of the cycle to respond to unforeseen 
crises overseas or domestically, if required. Such unforeseen crises 
could include both events overseas requiring a U.S. military response 
or domestic events, such as large-scale natural disasters or terrorist 
attacks. In either case, reserve units may be expected to contribute 
units to conduct homeland defense missions or to support civilian 
authorities. Although the Army has recently worked with the Army 
National Guard to assess equipment needs for some homeland security 
scenarios, it is not clear whether Army National Guard units will have 
sufficient quantities of such equipment during the early phases of the 
Army's force generation model to respond effectively under each 
scenario. Further, because the requirements for the military to support 
civilian authorities in a national crisis have not been determined, 
there is no yardstick for measuring how ready nondeployed forces are to 
respond to these potential emergencies. 

In 2005 we recommended that the Army define the end state of the units, 
personnel, skills, and equipment the Army reserve components would need 
to fit into the Army's modular force and rotational cycle.[Footnote 17] 
Although DOD agreed with our recommendations, many questions remain 
about the risks inherent in the Army's plans. The Army has developed, 
and continues to refine, a plan that will guide the implementation of 
its modular unit designs and force generation model. However, to date, 
the plan has not contained the level of detail needed to define the 
types and numbers of units that will be required, the process for 
coordinating the implementation steps of these two initiatives, or the 
funding streams needed to fully implement them. Until this information 
is developed, it will not be possible to assess the implementation 
risks and determine whether the proposed changes will provide the 
desired objectives of a more capable, flexible, and expeditionary force 
with reserve components fully ready for deployments no more than once 
in 5 or 6 years. 

Concluding Observations: 

While strategies such as transferring large numbers of Army reserve 
component equipment and personnel from non-deploying units to deploying 
units and leaving reserve component equipment overseas have met DOD's 
immediate needs to support overseas operations, these strategies are 
not sustainable over the long term. Growing equipment and personnel 
shortages in nondeployed units are symptoms of an outdated model for 
balancing reserve unit capabilities, costs, and risks. While DOD's 
strategies for supporting Army reserve component units during the Cold 
War may have been appropriate to that era, significant changes in the 
national security environment have led to greater use of the Army 
reserve components on an ongoing basis and spurred the need for a 
comprehensive reassessment of reserve component equipping, personnel, 
and training policies. In the absence of a comprehensive reassessment 
and development of a new model that matches requirements and resources 
with expected roles and missions, trends toward declining equipment and 
personnel readiness could persist well into the future and Army reserve 
component units may not be as well prepared for future overseas and 
homeland security missions as expected. For example, at a time when 
threats to the nation from terrorist attacks have increased, the Army 
National Guard has less equipment than it did in 2002 with which to 
respond to natural or man-made events that could potentially be 
catastrophic. Although DOD and the Army have some initiatives under way 
to enhance Army reserve component readiness, they have not yet fully 
developed a comprehensive model for managing personnel, equipment, and 
training in light of the Army reserve components' new operational role. 

The Army's key initiatives of building a modular force and establishing 
a cyclical force generation model represent important changes in how 
the reserve components will be organized and will operate in the 
future. However, many questions remain about how these initiatives will 
affect reserve component readiness. Until the Army develops a more 
detailed implementation plan that identifies equipment, personnel, and 
training requirements that are consistent with the Army reserve 
components' new operational roles, and until funding requirements to 
provide an acceptable and affordable level of readiness are identified, 
the Army's reserve components will continue to be challenged to support 
ongoing operations or prepare for the future. Moreover, until the 
details of such a plan are communicated to a broader audience, national-
level decision makers will not have sufficient information with which 
to assess DOD's progress and performance in transforming the Army 
reserve components. 

Mr. Chairman, this concludes my statement. I would be pleased to 
respond to any questions you or other members of the Commission may 
have. 

Contact and Acknowledgments: 

For more information regarding this testimony, please contact Janet St. 
Laurent at (202) 512-4402 or stlaurentj@gao.gov. Contact points for our 
Offices of Congressional Relations and Public Affairs may be found on 
the last page of this testimony. Individuals making key contributions 
to this testimony include Margaret Morgan, Assistant Director; Alissa 
Czyz; Paul Gvoth; Nicole Harms; Catherine Humphries; David Marroni; 
Terry Richardson; John Van Schaik; and Suzanne Wren. 

[End of section] 

Related GAO Products: 

Force Structure: Army Needs to Provide DOD and Congress More Visibility 
Regarding Modular Force Capabilities and Implementation Plans. GAO-06- 
745. Washington, D.C.: September 6, 2006. 

Force Structure: DOD Needs to Integrate Data into Its Force 
Identification Process and Examine Options to Meet Requirements for 
High-Demand Support Forces. GAO-06-962. Washington, D.C.: September 5, 
2006. 

Hurricane Katrina: Better Plans and Exercises Needed to Guide the 
Military's Response to Catastrophic Natural Disasters. GAO-06-643. 
Washington, D.C.: May 15, 2006. 

Reserve Forces: Army National Guard's Role, Organization, and Equipment 
Need to be Reexamined. GAO-06-170T. Washington, D.C.: October 20, 2005. 

Reserve Forces: Plans Needed to Improve Army National Guard Equipment 
Readiness and Better Integrate Guard into Army Force Transformation 
Initiatives. GAO-06-111. Washington, D.C.: October 4, 2005. 

Force Structure: Actions Needed to Improve Estimates and Oversight of 
Costs for Transforming Army to a Modular Force. GAO-05-926. Washington, 
D.C.: September 29, 2005. 

Reserve Forces: An Integrated Plan Is Needed to Address Army Reserve 
Personnel and Equipment Shortages. GAO-05-660. Washington, D.C.: July 
12, 2005. 

Reserve Forces: Actions Needed to Better Prepare the National Guard for 
Future Overseas and Domestic Missions. GAO-05-21. Washington D.C.: 
November 10, 2004. 

Reserve Forces: Observations on Recent National Guard Use in Overseas 
and Homeland Missions and Future Challenges. GAO-04-670T. Washington, 
D.C.: April 29, 2004. 

Homeland Defense: DOD Needs to Assess the Structure of U.S. Forces for 
Domestic Military Missions. GAO-03-670. Washington, D.C.: July 11, 
2003. 

FOOTNOTES 

[1] GAO, Reserve Forces: Plans Needed to Improve Army National Guard 
Equipment Readiness and Better Integrate Guard into Army Force 
Transformation Initiatives, GAO-06-111 (Washington, D.C.: Oct. 4, 2005) 
and Reserve Forces: An Integrated Plan Is Needed to Address Army 
Reserve Personnel and Equipment Shortages, GAO-05-660 (Washington, 
D.C.: July 12, 2005). 

[2] GAO, Reserve Forces: Actions Needed to Better Prepare the National 
Guard for Future Overseas and Domestic Missions, GAO-05-21 (Washington, 
D.C.: Nov. 10, 2004). 

[3] GAO-06-111. 

[4] To meet minimum deployment criteria, a unit must generally have at 
least 80 percent of its mission-essential equipment on hand. 

[5] GAO-05-660. 

[6] GAO-06-111. 

[7] Replacement plans for removed equipment and supplies are not 
required for transfers in support of force restructuring adopted as a 
result of planning, programming, budgeting, and execution process 
decisions approved by the Secretary of Defense. 

[8] GAO-06-111. 

[9] GAO-06-111. 

[10] GAO, Hurricane Katrina: Better Plans and Exercises Needed to Guide 
the Military's Response to Catastrophic Natural Disasters, GAO-06-643 
(Washington, D.C.: May 15, 2006). 

[11] GAO-05-21. 

[12] GAO-05-660. 

[13] GAO, Force Structure: DOD Needs to Integrate Data into Its Force 
Identification Process and Examine Options to Meet Requirements for 
High-Demand Support Forces, GAO-06-962 (Washington, D.C.: Sept. 5, 
2006). 

[14] GAO, Force Structure: Capabilities and Cost of Army Modular Force 
Remain Uncertain, GAO-06-548T (Washington, D.C.: Apr. 4, 2006). 

[15] GAO-06-548T. 

[16] GAO-06-548T. 

[17] GAO-05-660 and GAO-06-111. 

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