Telephonic Briefing on the FY 2006 Emergency Supplemental Request for the Global War on Terror (Text Only)

Telephonic Briefing on the FY 2006 Emergency Supplemental Request for the Global War on Terror

OMB Deputy Director Joel Kaplan
Under Secretary of Defense Tina Jonas
State Department Senior Advisor for Foreign Assistance Maria Raphael
State Department Senior Advisor for Iraq James Jeffrey

MR. KAPLAN: Hi, this is Joel Kaplan from OMB. Thanks for joining us today. My remarks will be brief, because I will quickly turn it over to the experts at the Department of Defense and at the Department of State to discuss the specifics.

Today the President is sending Congress a request for $72.4 billion in emergency supplemental funding for fiscal year 2006 to fund our efforts in the global war on terror. The President is committed to giving our troops and commanders in the field the resources they need to fight and win the war on terror. This request provides those resources. It helps prepare our Iraqi and Afghan allies, security forces, and their governments to stand on their own and successfully combat the insurgents, as well as providing emergency humanitarian relief.

Specifically, the request includes $65.3 billion to support the Department of Defense, $4.2 billion for the Department of State and other international operations, and $2.9 billion for intelligence community management and classified activities in support of the war on terror.

The budget that OMB Director Josh Bolten released on the President's behalf last Monday contained our best estimate as we were putting the budget together of what this 2006 war supplemental would be, and we included a figure of $70 billion in our deficit projections for 2006. As Director Bolten and I said at the time, that figure was an estimate that would be refined as we worked out the details of the supplemental request with the departments. The supplemental that we're requesting today, at $72.4 billion, is very close to those initial projections.

With that, I'll turn it over to Tina Jonas, the Department of Defense Comptroller, who can walk you through DOD's portion of the supplemental.

UNDER SECRETARY JONAS: Hello, this is Tina. As Joel said, the amount available to the Department being asked for in this request is $65.3 billion to cover the incremental costs of the operations in Iraq and Afghanistan and in the global operations against terrorists.

And what we've got included, as we said, primary -- one of the largest pieces in this is the operational costs, or operations and maintenance funding of $34.7 billion. Again, this is to fund the incremental costs of ongoing military operations in Iraq and Afghanistan. In addition, we include in this request to Congress $10.4 billion, which will provide for the reconstitution, replenishment and repair and replacement of equipment. Many of you are aware of the issue that we have with our equipment being warn down. And so as in past supplementals, we're providing -- requesting some funds to provide for overhaul and replacement of equipment, like Humvees, Bradley Fighting Vehicles, heavy truck overhauls, et cetera. So some of these are the things that you will find in this request.

In addition, we continue our conversion of regular brigades -- Army brigades to modular combat brigade teams, $3.4 billion for that. And we provide funding for some critical projects in the central command area of responsibility, and these include force protection measures and operations projects to include perimeter security and airfield improvements for the theater operations.

In addition, the request includes $5.9 billion to train and equip Iraqi and Afghan security forces. The Iraq piece of that is $3.7 billion, and the Afghan security forces piece is $2.2 billion. And as we have in past, we're including significant sums to try to address the problem of IEDs. This is the explosive devices -- improvised explosive devices. We provide $1.9 billion to purchase, develop and sustain critical IED Defeat technologies to include jammers, other detection capabilities, and to provide testing for some of the equipment that's there. We also ask for some training and support for these IED equipment -- Defeat equipment.

And we just add that we are urging that the Congress act quickly on this. We've already briefed the Congress this afternoon, and we will be providing details to them later today and tomorrow.

MS. RAPHAEL: Hi, this is Maria Raphael. The international affairs portion, as Joel mentioned, is $4.2 billion. Of that, $2.2 billion is foreign ops; $1.65 billion is State operations; and $350 million is food aid. Included in that is $3.25 billion for Iraq, which consists of post-conflict provincial reconstruction team programs, infrastructure security and sustainment, and national capacity building, embassy operations and overhead costs, security and infrastructure, and IGcosts, as well mission operation costs.

For Afghanistan it's $112.5 million, which includes power generation transmission programs, refugee assistance and debt relief, embassy security and mission operating costs.

For Pakistan, it's $126.3 million. It's to fully fund the President's FY2006 commitment for an additional $150 million in earthquake relief, including reimbursements to special accounts.

For Iran, it's $75 million and includes expanded and improved broadcasting, democracy programs, increased education and cultural programs, and public diplomacy.

For Darfur, $389 million -- including peacekeeping efforts including the AMIS and transition to blue-hatted missions; food assistance, and non-food humanitarian assistance including refugees. Other Sudan is $125 million, including food aid, U.N. peacekeeping costs, funding for refugee returns and mission operating costs. We also have $125 million for other food aid, which is primarily dedicated to Africa.

And lastly, we have refugee assistance at $23.8 million, which includes refugee and IDP returns, and integration in Liberia, as well as keeping the food pipeline secure.

Q I didn't hear anything in the announcement with regard to Hurricane Katrina, additionally for that. Is that not going to be included in this supplemental package?

MR. KAPLAN: This is Joel Kaplan from OMB. The President will be transmitting emergency requests for Hurricane Katrina recovery later today, as well. This call was intended to be a discussion of the war on terror supplemental request. These will be two separate transmittals. Yesterday, Chairman Powell, the Gulf Coast coordinator, I think discussed some elements of the hurricane relief package, in particular the additional funding for Louisiana housing and relocation and mitigation.

Q Just to follow up on the Katrina request, can you tell me what the amount will be?

MR. KAPLAN: Again, I will tell you the amount, and then, hopefully, some of the other questions will take advantage of all of the expertise we have from DOD and State.

The President will transmit a supplemental request today for $19.8 billion in emergency funding to support ongoing hurricane recovery efforts. As you know, President Bush is committed to helping residents of the Gulf Coast rebuild their lives in the wake of the disaster, and these additional funds will support those ongoing recovery efforts at the Federal Emergency Management Agency, at Small Business Administration, and other federal government agencies.

Q Would you like these two supplementals to be joined, then, and move together as one package when it's on the Hill?

MR. KAPLAN: I'm going to defer to the congressional leadership. Obviously, we'll be working closely. And once the supplemental requests are on the Hill, it will be a matter for the leadership to determine how best to schedule their consideration in the Congress.

Q I did have one question about the DOD portion of the supplemental. I wanted to ask, of the various amounts for DOD, what amount represents the kinds of programs the lawmakers say have been covered by the regular DOD budgets, rather than emergency spending in the past?

UNDER SECRETARY JONAS: Sorry, yes. Hi, how are you? The modularity piece has been discussed in prior years with some of the members of Congress, and we've got $3.4 billion in this request for that. The distinguishing point, and the reason we include it in the supplemental, is because we have been -- the Army is rotating many of these units in and out of theater, and they are much more efficient. They relieve the stress on the force so the -- this new configuration is very helpful to that. So they fight better.

And so the Congress last year was -- understood that. And so this is the second piece of that. In fiscal year 2007, the budget that we just sent to the Hill, we include those funds in the baseline. But the -- it was an urgent need to get the troops that are rotating in and out of theater into this modular configuration.

Q Thank you. Just one question about the State portion of it, and that's about the Baghdad embassy. How much in funding do you have for that?

AMBASSADOR JEFFREY: Sure. It's $1.642 billion for State USAID operating expenses in Iraq.

AMBASSADOR JEFFREY: There is no money in the sub for that. There was money last year for that.

Q A question about the defense portion. I note that a significant chunk of the money in the supplemental is for what's described as operation cost maintenance for equipment. And there's also that the separate portion for IED Defeat technology. I'm curious, within either of those components is money designed specifically for the purpose of up-armoring vehicles?

UNDER SECRETARY JONAS: We do have funds in there for the Humvees that are up-armored. I don't have the breakout at this moment. But the equipment and replacement overhaul figure is $7.2 billion. So again, that includes Humvees, it includes Bradley Fighting Vehicles, and heavy trucks. So the types that would be out there. And I think I mentioned, the ID portion was $1.9 billion.

Q Hi, thank you. My question was regarding the recent number, Tina, that you gave us. Francis Harvey, the Army Secretary, had testified that the Army would be seeking, I think, $12 billion in reset. And General Hagee, the Marine Corps Commandant, said he would be seeking $6 billion. So that would be about $18 billion, and I believe the number that you gave was only $10 billion. Are they factoring things into that that you are not?

UNDER SECRETARY JONAS: Yes, let me clarify there. The total requirement that we have is $18.2 billion. The Congress has already provided $7.8 billion. So the balance there is the $10.4 billion that I talked to you about.

UNDER SECRETARY JONAS: In Title IX that they just passed, they provided that -- those funds.

Q Okay. And can you break down the -- how much of what's in the supplemental goes to the Marines versus the Army?

UNDER SECRETARY JONAS: I don't have the figure right now, but obviously, the bulk of it will go to the Army. But again, as such for both of them, including the -- I mean, the Humvees and the Bradleys and the trucks are all ground forces.

Q This is for Ms. Jonas. Can you step back, and roughly, how much is in the request for procurement in general? You threw out several figures here. Is there like a bottom-line procurement that includes reset, new purchase, that sort of thing?

UNDERSECRETARY JONAS: So for military personnel, it's $9.6 billion. For operations and maintenance it's $33.4 billion. The procurement piece is $15 billion. Now remember, that includes force protection items, as well, so it's not just a reset piece. We have $500 million for defense working capital fund, the military construction piece I talked to, and then the Iraq security forces piece, and there's a small piece of R&D in there.

Q When is the next $70 billion going to go over -- the $70 billion for the '07 portion?

UNDER SECRETARY JONAS: What the administration said that it would forward is a bridge for the '07 piece. And, Joel, you might want to address the timing on that. I don't have that for you at the moment, but we would expect it would be soon. Joel, you may want to talk to that.

MR. KAPLAN: I'm not sure I can amplify on that too much, Tina. I think we would expect that sometime this spring we'll come forward to the Congress and propose an allocation of that $50 billion allowance that we included in the 2007 budget. But I don't have a date on that.

Q All right, I have one more question for Ms. Jonas, then I'll get off. Last year's supplemental presupposed or assumed 138,000 troops would be in Iraq last year. What's your assumption right now for force levels? Obviously, it will ebb and flow, but what's the going in assumption?

UNDER SECRETARY JONAS: It's the same. But remember, that's an average over the year. So it will ebb and flow.

Q This is for Ms. Jonas. Can you give us a sense of the pace, the funding for the Iraqi security forces? In other words, your request here -- sorry, I don't have it right in front of me -- $5.9 billion, of which $3.7 billion is for Iraq -- how does that compare to previous supplemental requests, and is the amount of money per month, or however you want to break it down, going up for ISF? Can you give us a sense of that?

UNDER SECRETARY JONAS: Sure. The burn rate -- what we refer to as the burn rate for Iraqi Freedom right now is $5.9 billion, and for Operation Enduring Freedom is $0.9 billion, or $900 million. So the figures are a little bit higher than last year, but a lot of that is due to the price of fuel. We've got concerns there, and so we need to cover that. Transportation goes up, and so those are some of the reasons. And the other piece that's in here is the procurement piece that I just talked to Tony about. So those are the primary reasons that the figures are up a bit.

Q But I mean, specifically for the Iraqi security forces, is it just things like fuel, or is it equipment? Are there things you're spending more on now than you weren't a year ago?

UNDER SECRETARY JONAS: Yes, but in terms of operations, it's pretty much the same sort of steady state.

Q Could you, Tina, talk to us about the bridge funding from 2006 and how it breaks down? Because, obviously, the $65 billion that you guys are talking about now is not it, right? This goes on top of the money that's already been appropriated?

UNDER SECRETARY JONAS: That's right. Yes, let me give you those numbers. Our operation costs -- I'll go through with the Title IX piece. And remember that what was provided by Congress, not all of it, the $50 billion actually went for us. There were other things, including Guard funding, which was not related to the war. It's helpful to us. The Guard has just been terrific, and we've got some funding in this supplemental for the Guard, but just so you know. The total amount in the bridge fund available to us for war costs was $45.5 billion; $29.2 billion of that was for operational costs; $7.8 billion, which I talked to earlier was reconstitution and equipment; $2.5 billion was for force protection; $1.4 billion was the improvised explosive device Defeat funds; $1.6 billion was for Army modularity. We had $2.2 billion for fuel and transportation increases and some for the -- $500 million for the commander's emergency response program.

Q Okay, and is there -- is this on paper anywhere that we can have this and the supplemental that you all are briefing on? There are so many numbers flying around.

UNDER SECRETARY JONAS: Yes, I understand. We're submitting -- certainly, I'm sure our public affairs office will work with you. We are submitting detailed justification to the Congress either later today or tomorrow.

MR. KAPLAN: And at a slightly more general level, the White House will be releasing a fact sheet that explains what's in the supplemental overall when the actual request is transmitted to the Hill this afternoon.

Q Thank you, I have a couple of questions. First for Joel. Joel, while the effect on the deficit in terms of GDP may -- as a percentage of GDP may be infinitesimal, I assume that the $2.4 billion added to the supplement that you're talking about here, as opposed to the $70 billion you were talking about a couple of weeks ago would adjust that figure somewhat to what, from $423 billion up to something else?

MR. KAPLAN: Mark, I think it's possible that it will. Not to get too technical for everybody on the call here, but what's included in our deficit estimate is not the budget authority number of $70 billion or $72.4 billion, it's the outlays that would be expected from that spending in 2006. And a differential in budget authority of $2.4 billion will have a significantly smaller incremental effect on outlays. So short answer is, yes, there should be some impact, but it depends on how quickly the additional funding is spent. And I would expect it will be smaller than the $2.4 billion number, ultimately.

Q And, Tina, if you could clarify something on the burn rate. Am I not mistaken, or a few weeks ago when we were talking about the supplemental, I believe the burn rate in Iraq was described as $4.5 billion, and the burn rate in Afghanistan is $0.8 billion? Did you speak of a figure of $5.9 billion today for Iraq?

Q Oh, okay. And then the last question on that was, you mentioned the $1.9 billion for IED. That's an interesting -- that's a lot of money, and I'm curious about -- if you could talk a little bit about what's involved in that and how effective you think that will be for what is a very big problem.

UNDER SECRETARY JONAS: Well, the department spent a fair amount on this so far. We're provided in the bridge funds that I just mentioned $1.4 billion already. So in addition to this -- the total amount for '06 will be $3.3 billion in addition to what we're asking for, if the Congress provides the funds, and I'm sure they will. This is a very important effort for the department.

And the types of things that are being funded include the jammers -- we've got a very successful program on jammers -- some ground and airborne persistent surveillance systems for detection; some testing for IED Defeat components; and some training and support there. I'll leave it -- General Monty Meigs is the -- leads the effort here in the department, and I'm sure our public affairs office could get you some of the details on the effectiveness of the systems that we've purchased and those that are out in the field.

Q I may have missed this, but you gave a breakdown of $2.9 billion out of the $72.4 billion supplemental that would go toward intelligence community management. Is that under State, or Defense? And can someone explain the details of what that covers?

MR. KAPLAN: This is Joel. I'm probably the only one who can touch on that one on the call. First of all, most of that is classified activity that is typically funded to support the war on terror in the supplemental. There is also, I believe -- the reference I made to the community management that has to do with additional resources for the accelerated stand-up of the Office of the Director of National Intelligence. Does that answer your question?

Q Yes, and no. I mean, you said most of it is classified, so you can't get into details. But how does this compare to last year's supplemental in terms of the classified activity that was funded?

MR. KAPLAN: I don't have in front of me what was included in last year's supplemental. We have made some efforts in the last year or so to move some of the supplemental funding for the global war on terror into the intelligence community's base budget. But that number is classified, the base budget, so I'm going to not get into any more detail on this call.

Q I'm curious why, if the burn rate is $6.8 billion for both operations, the total request for the current year is approaching $115 billion -- what is the additional money that is requested going for?

UNDER SECRETARY JONAS: No, no, no. I think I explained that we did not -- the total requirement for the Department of Defense for the year is $110.8 billion; $45.5 billion of that was provided by Congress in the bridge. Although the bridge fund was -- it's generally indicated as $50 billion available for our operations, but it is not exactly correct. And so the amount that goes against our requirements is $45.5 billion out of the bridge. And then you add to it the $65.3 billion which we're requesting, and you get the $110.8 billion.

Q Right, but that translates to a higher per month amount than the $6.8 billion that you're referencing.

UNDER SECRETARY JONAS: I am just telling you what we're doing right now, and this fluctuates from month to month. This is an average.

Q I have a similar question, Tina, about the burn rate. I guess I'm not following. If it's $6.8 billion and that's your estimate per month for Iraqi Freedom and Enduring Freedom, that's $70.6 billion for the year. And the other, the remaining $40 billion is just in case it costs more?

UNDER SECRETARY JONAS: I'm not following you. What do you mean, in case it costs more?

UNDER SECRETARY JONAS: Let me -- the burn rate that we have is an average, okay? It's an average. It goes up and down per month. All right? So let me run through the figures what our total requirement is for the year, what we know about right now -- I mean, our activities fluctuate from month to month, so --

UNDER SECRETARY JONAS: Let me run through the numbers. Okay? Our operations costs are $63.9 billion; our reconstitution and equipment costs are $18.2 billion; our force protection equipment is $5.1 billion; our IED -- explosive device Defeat number is $3.3 billion; the Army modularity number is $5 billion. Iraq security forces funding that we're requesting is $5.9 billion. The fuel piece is $4.4 billion. Support for coalition forces is $2 billion. Military intelligence is $1.7 billion. The commander's emergency response program is $900 million. And the military construction is $400 million.

Now you back out of that what has been provided to us in the bridge supplemental, and you come out with our total requirement. Now as in past years, occasionally we have to use base funds to fund the war. And last year we did use some O&M funds for that. And so this supplemental is intended to try to get the best estimate we possibly can. But our cost of war reports are based on what we -- the best information we have at the time.

Q Okay, and so it's fair to say $6.8 billion is for Enduring Freedom and Iraqi Freedom per month, right now?

Q On the $3.25 billion for Iraq from the State Department money, could you break that down a little bit, like how much is specifically Iraq reconstruction versus other needs?

AMBASSADOR JEFFREY: Sure. I can do that. First of all, you have to break it down into -- as was briefed earlier -- $1.642 billion for the U.S. State operating expenses, which is a totally separate account. That basically allows us to operate our people there, pay for certain salaries and our own vehicles and that kind of thing. $1.609 billion is foreign assistance; generally what you could call reconstruction. But the point I want to make is this supplemental represents a shift from the Iraq relief and reconstruction fund, the IRRF $18.4 billion, and the IRRF 2, which was primarily heavy construction in support for the security forces, to a capacity-building focus.

It's broken down, the $1.609 billion into $962 million for the security track of the President's Iraq strategy, which includes focused stabilization, 10 strategic cities where we want to do a variety of employment programs, capacity building, and low-level what we call retail construction, as well as money for our provincial reconstruction teams to also work with local authorities on construction, along with a $185 million emergency employment generation, and $287 million to secure better by hardening infrastructure in the oil and electricity areas.

We then have $355 million for the economic track. That's almost all for infrastructure operations and maintenance. In other words, we want to keep the infrastructure that we put in place operating and functioning, and that includes $60 million of that $355 million for capacity development of technical and management training in six sectors, again, to complement the infrastructure maintenance, because we do want to train people to keep this operating.

Then there's $297 million for the political track. That's focused primarily on the Iraqi ministries to develop their capability, once again, in a year of transition, FY'06. We're looking at not only the Iraqi security forces, which is covered in the defense budget, but also the political and economic lines of operation, which we have primary responsibility for. And there the key target of our efforts just to develop Iraqi capacitates. And the $1.6 billion is aimed at that.

Q Okay, thank you. One more, if I -- could you repeat the food assistance number.

UNDER SECRETARY JONAS: It might be helpful for me to clarify for some of those who have asked questions on the burn rate. The war -- the cost of war supplemental piece is $82 billion. So the security forces would be in addition to that, $6 billion -- I'm quoting '05 numbers for you. And the Army modularity piece is the other $5 billion. We have procurement -- last year was $3 billion, and intelligence and support were $6 billion. So if you're tracking that burn rate in last year's figures, that might help.

Q I understand the burn rate is $6.8 billion a month, and that can fluctuate, right? But can you please reiterate exactly what the total amount is for Iraq? And then is Afghanistan in supplemental?

UNDER SECRETARY JONAS: Okay, let me ask you, which number do you want? Do you want the number that we're -- what are you trying to track?

Q I'm wondering all together, because there's so many numbers around. I'm wondering if there is a total number for both.

Q I'm just wondering if there's a total amount -- that I'm right, right? The $6.8 billion a month can fluctuate. That's the burn rate.

Q But do you have a total number for both Iraq, and then Afghanistan? A total for Afghanistan, altogether? There's just so many numbers.

UNDERSECRETARY JONAS: Yes, I'm sorry about that. What I can do is -- I don't have it broken down, necessarily, that way right now. I think it's more important that we describe what we're trying to do and what we're spending money on. But I can certainly get those figures for you, the exact figures, on each country.

UNDERSECRETARY JONAS: But the total spending for both for the -- for '06, we're proposing -- we've already got the $45.5 billion, which we are using now, and we're proposing to the Congress an additional $65.3 billion, which would be a total spending for both operations of $110.8 billion, if Congress approves what we're sending forward.

UNDER SECRETARY JONAS: Last year, in '05, we were about $100 billion, $82 billion of that was the war costs, and then the $6 billion was the security forces.

MR. KAPLAN: You can certainly contact the Pentagon press office. They'll help with that.

Q Tina, could you tell us when Congress has to pass this by? Did you say there was a month when you'll need this money?

UNDER SECRETARY JONAS: We'd certainly urge the Congress to help us within the next few months. I'm reluctant to give a particular date at this point. Last year we were able to go deep into the spring, but it was very difficult for us. So obviously, we're asking the Congress to move this one very quickly. I don't have an exact date for you.

Q Okay, and one more, if you could. Last year Rumsfeld asked for some flexibility in transferring funding, particularly with I think up to $5 billion for certain programs. Do you have that authority now, or are you asking for it again?

UNDER SECRETARY JONAS: We are asking for additional what they call general transfer authority. I believe it's $4 billion. I'll double check, and we'll get with Brian and give you the right -- make sure it's right. But that's very important to us because things just -- we get to midyear, and sometimes we haven't covered everything. And we need to be able to adjust funding levels. It was very important to the Army last year that we were able to do that. We're very appreciative to the Congress for providing that authority.

MR. KAPLAN: Okay, if there are no other questions, we'll end the call now. After we transmit both supplementals, there will be fact sheets coming out from White House Press detailing them. And then each agency can respond to detailed questions in their each sphere of influence. So thanks for joining us.

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