MANAGING BY MDEP --Trying to break the resourcing code-- 12 October 2011 Mr. Ken Pierson

1. MANAGING BY MDEP --Trying to break the resourcing code-- 12 October 2011 Mr. Ken Pierson PA&E Division, IMCOM G8

2. Bottom Line Up Front We are struggling with the fundamentally different fiscal reality… How do we get our POM requirements supported?

3. The challenge Army PPBE Process Establish, justify, and acquire the fiscal and manpower resources needed to accomplish the Army’s assigned missions… PLANNING PROGRAMMING BUDGETING Department of the Army has supported 3 of 27 (.111) POM issues submitted the past three years EXECUTION

4. Our current/anticipatedresource environment • Mandated/accelerated • funding and manpower • efficiencies and savings • Protected programs / high • customer expectation bar • Directed/inherited missions • Increasing funding outflow • (Memorandums of • of Agreement (MOA), • Support Agreement s, etc. • Decreasing Overseas Contingency Operations (OCO) funding

5. OMB/DoD/DA guidance the past year 17 Aug 11 23 Aug 11 2 Sep 10 23 Mar 11 20 Jun 11 11 Jul 11 15 Aug 11 09 Sep 11 • 2 Sep 10 - SECDEF Efficiency Initiatives • 23 Mar 11 - VCSA Plan to Reduce Organizational Strength • 20 Jun 11 - SECARMY Installation Management Reforms • 11 Jul 11 - SECARMY Implementation of OMA-Funded Civilian Reductions • 15 Aug 11 - SECARMY Commission to Streamline Army Bureaucracy • 17 Aug 11 - OMB Fiscal Year 2013 Budget Guidance (5% / 10% reduction) • 23 Aug 11 - OSD Revised FY1317 Integrated Program/Budget Submission Guidance • 09 Sep 11 – SECARMY Information Technology Management Reforms • 13 Sep 11 –SAC-D Mark-Up (freeze DoD spending at FY11 level of $513B)

6. The results – where we are • Funding • Initially told to expect a decrement of $160M in FY14; $390M in FY15; $620M in FY16 • Changed to $2B decrement across the 13-17 POM • Latest numbers reflect a $3.7B OMA decrement across the POM • Manpower • Briefed Army leadership we could cut approximately 2,900 civilian and CME TDA • authorizations by FY14 • Changed to potential 4,000 TDA authorization decrement starting in FY14 • Directed to cut 4,162 civilian TDA authorizations and all civilian over strength (2,619) • by the end of FY12 (30 Sep 2012); report progress to HQDA monthly • Service Contracts • Initially told to expect a 10% per year decrement per year starting in FY12 ($56M) • Changed to 10% per year decrement starting in FY14 (~$500M from FY14 to FY16) • Changed to $25M in FY12; $50M FY13; $100M FY14; $500M FY15; $1B in FY16 • Army now expected to achieve an annual savings of $2.5B by the end of FY16

7. IMCOM managing by MDEP We will allocate money to Garrisons by MDEP. It is my view that allocating funds and executing budget requirements was too random in the past. To eliminate this IMCOM will program, manage and execute funding by MDEP. LTG Rick Lynch CG, IMCOM 15 March 2011 • How the Army Runs (Chapter 9) • Commanders: • Plan, program, and budget for assigned missions, organizations, and functions. • Document manpower in their subordinate organizations per allocated manpower levels. • Execute the approved command program within allocated resources, applying the • inherent flexibility allowed by law and regulation. • Assess program performance and budget execution. • Account for and report on the use of allocated funds by appropriation and MDEP.

8. The challenge Army PPBE Process Establish, justify, and acquire the fiscal and manpower resources needed to accomplish the Army’s assigned missions… PLANNING We program by Management Decision Package (MDEP)… …but we execute by Sub-Activity Group (SAG)… PROGRAMMING BUDGETING EXECUTION

9. IMCOM’S 68 MDEPs 14 INSTALLATION PEG (II) BRAC – Base Realignment & Closure QFMC – Financial Management Activities DAG3 – Leadership Initiatives QHFM – Unaccompanied Personnel Housing E315 – Minor Construction Program QLOG – Logistics Activities E32H – AFH, O&M, Leasing, US QLPR – Law Enforcement E32R – AFH, Revitalization, US QMIS – Army Installation Support E33H – AFH, O&M, Leasing, US, Overseas QNMG – Installation Mgt Cmd and Support E33R – AFH Revitalization, US, Overseas QOIM – Base information Management Operations E34H – AFH, O&M, Leasing, Overseas QPSG – Military Personnel E34R – AFH, Revitalization, Foreign QPSM – Physical Security Matters E35H – AFH, O&M, Leasing, CONUS QRPA – Real Property Maintenance E35R – AFH Revitalization, CONUS QSEC – Directorate of Security E3H6 – Unaccompanied Personnel Hsg QUTM – Army Energy & Utility Program E3H7 – Permanent Party Barracks VCAP – Army Career and Alumni Program E3H9 – Operational Readiness Tng Complex VENQ – Environmental Quality E4H6 – UPH, Initial Entry Training VIPP – Installation Preparedness Program E4H7 – UPH, Permanent Party VTER – Anti-terrorism EAFS – Focused Facility Strategy Investment EAMF – AMF Facility Requirements EGRO – Grow the Army MILCON EIGP – IGPBS ENVR – Environmental Restoration Program ERCI – Residential Communities Initiative ERVT – Military Construction FAPC – Community/Family Support Center MS4X – Information Assurance MU1M – Visual Information Mission Support QAAF – Army Airfields and Heliports QAAP – Alcohol Abuse Program QACS – Army Community Services QCYS – Child and Youth Services QDEM – Facility Reduction Program QDPC – Community Support Activities QDPW – Public Works TRAINING PEG (TT) TATM – Integrated Training Area Management TAVI – Visual Information Training Spt Center TBAS – Maneuver/Close Combat Non-System TBWG – command & Control War-game Simulations TCSC – Battle Simulation Centers TSGT – NCO Professional Development TTDY – Military Training Specific Allotment VIAD – Homeland Integrated Air Defense System VOPR – Land Forces Readiness VSCW – Training Range Operations VSRM – Sustainable Range Modernization WCJT – Joint Readiness Training Center (OPTEMPO) WEAD – Non-Divisional MTO&E Units WSUS – MTO&E Unit Equipment Support 49 MANNING PEG (MM) VACE – Army Continuing Education VMBH – Military Burial Honors 2 ORGANIZING PEG (OO) VMUS – National Army Museum Program XMGH – Major Mgt Headquarters Activities 2 IMCOM programs within 68 MDEPs; SUSTAINING PEG (SS) ASLT – Logistics Support Programs 1

10. The plus side of executing by SAG SAG 121 QLOG Logistics Activities QNMG DPTMS – Training Area Management/OPS TATM Integrated Training Area Management TAVI Visual Information/Training Support TCSC Battle Simulation Centers VOPR Land Forces Readiness VSCW Training Range Operations WSUS MTOE Unit Equipment Support SAG 131 ERVT Environmental Restoration FAPC Community/Family Support MU1M Visual Information Support QAAF Airfields/Heliports QAAP Family Readiness QACS Army Community Services QCYS Child/Youth Services QDPC Recreation/Community Support QDPW Public Works QFMC Financial Management QLOG Logistics Activities QLPR Law Enforcement QMIS Army Installation Support QNMG Installation Command & Management QOIM Information Management Operations QPSG Military Personnel QPSM Physical Security QSEC Security Program Management VENQ Environmental Quality VIPP Installation Preparedness VSCW Training Range Operations VTER Anti-terrorism Unless there is higher level or command imposed guidance to the contrary, funding can be moved between MDEPs within the same SAG

11. The down side of executing by SAG SAG 121 QLOG Logistics Activities QNMG Installation Command & Management TATM Integrated Training Area Management TAVI Visual Information/Training Support TCSC Battle Simulation Centers VOPR Land Forces Readiness VSCW Training Range Operations WSUS MTOE Unit Equipment Support If under executing in one MDEP may be directed to internally fix, exacerbating the real issue – under resourced Other problems caused by moving dollars between MDEPs -- only a temporary fix; not recognized in the programming process -- costing models not validated -- one MDEP manager happy (receiving); the other (losing) is not happy

12. The result • Programming, budgeting and execution processes out of synch • Requirements over and understated • Resourcing models not validated • Continuing year-of-execution challenges • Confusion throughout the command • when new budget distributed • No credibility with the building FY11 BOS Distribution (from $1B Added) MDEPDESCRIPTION ($000) QAAF Airfields/Heliports 24,506 QAAP Family Readiness 14,415 QDPW Public Works 353,776 QFMC Financial Management 48,569 QHFM UPH Mgt/Furniture 39,429 QLOG Logistics Activities 240,307 QLPR Law Enforcement 210 QMIS Army Installation Support 105,708 QNMG Installation Cmd & Mgt 67,744 QPSG Personnel Support 61,732 QPSM Physical Security 13,000 VENQ Environmental Quality 19,951 VIPP Installation Preparedness 2,065 991,412

13. What happens if we don’t manage by MDEP • Programming, budgeting and execution processes out of synch • Requirements over and understated • Resourcing models not validated • New/expanded missions not supported • Continuing year-of-execution challenges • Confusion throughout the command • No credibility with the building

14. So…where does that leave us? • CG ‘manage by MDEP’ guidance implemented…had to make some transfers • between MDEPs in FY11 • Initially operating under an FY12 Continuing Resolution Authority (CRA) • Initial FY12 funding numbers reflect ~$1B less in BOS compared to FY11 • FY12 civilian reduction plan briefed to Army leadership; decision to execute pending • 13-17 POM not yet locked; HQDA still working ‘Alternate POM’ numbers with OSD • 14-18 POM timelines accelerated; Commander’s Narrative Assessment (CNA) and • briefing to HQDA due in December How do we get our POM requirements supported?

15. Questions or Suggestions

16. END OF BRIEF INSTALLATION MANAGEMENT COMMAND “Sustain, Support and Defend”

17. What is an MDEP? Management Decision Package MDEPs Do Not Cross PEGs • Accounts for all Army resources – dollars and • manpower. • Records manpower and total obligation authority • (TOA) over the 9 fiscal years needed to display • the program and budget. • Describes the capability of the Total Army – • Active, Guard, and Reserve. • Contained in six HQDA Program Evaluation • Groups (PEG). ASA(ALT) & G-8 ASA(I&E) & ACSIM ASA(M&RA) & G1 ASA(M&RA) & AASA ASA(ALT) & G-4 ASA(M&RA) & G-3/5/7

18. What is a POM? Program Objective Memorandum POM • A document produced annually that • displays the Army program over a six-year period. • Contains what the Army proposes to do with the • resources that OSD has provided for each of • the six program years in terms f forces, • manpower, procurement, research and • development (R&D), construction, logistics, • and all other things it takes to develop, operate, • and sustain the force. • MDEPs record the manpower and total obligation • authority needed to display the program and budget. TRM What if Drills New ways to do things Additives BRM Concept Plans Functional Analysis Models

19. The Process – Who Gets A Vote The key to success! ACSIM (II PEG) Resources Validation Team (RVT) HQDA MDEP Managers 6 Program Evaluation Groups (PEGs) Program Integrators CAR, DARNG, CIO/G6 IMCOM Commander’s Narrative Assessment (CNA) – 5 pages or less Briefing to PPBC – 35 minutes Inter-Command Transfer (Agreed Loss or Gain) – Schedule 8 Manpower (TDA) Changes – Schedule 8 Program Budget Assessment Team (PBAT) Planning, Programming, Budget Committee (P PBC) Budget, Requirements, and Programs (BRP) Review 2-Star BRP (As Needed) 3-Star BRP SRG Army Enterprise Board (AEB) Executive Office of the Headquarters (EOH) (As Needed) (Advisory Role)