The data collected on this project is being compiled and will be published in an evaluation report early this spring. This report will be made available to the private sector and other Government agencies with the hope that the information will stimulate efforts to supply new housing through the industrialized process.

NORTON AFB, CALIF.

With regard to Department of Defense housing utilizing the industrial concept demonstrated at George Air Force Base, a follow-on project at Norton Air Force Base, Calif., authorized and funded in 1971, is now under construction. This project reflects many of the lessons learned on the George AFB project, and we are pleased to report to the committees that it is proceeding ahead of schedule.

RESERVE COMPONENTS

I would now like to discuss briefly the Reserve component program. The fiscal year 1973 proposed authorization bill contains a request for $97.2 million for urgently needed training facilities for the Reserve components of the Army, Navy, Marine Corps, and Air Force, which is reflected in my statement.

This amount, $97.2 million, is an increase of some 21 percent over last year's authorization, and represents the largest amount of the military construction program devoted to Reserve facilities during the last 10 years.

This increased emphasis on the facilities programs of the Reserve components directly reflects the concern of the Department of Defense that every reasonable effort be taken to insure that our Guard and Reserve units are provided with modern and effective training facilities designed to increase their combat readiness.

This is especially critical in view of our current policy and planning wherein the Reserve components will constitute our initial and primary source of augmentation for the active forces in future emergencies.

POLLUTION ABATEMENT

At this point, I would like to briefly discuss our program for control of environmental pollution which I know is of great interest to these committees.

Our program for projects to abate air and water pollution in this year's bill includes $170.6 million for 156 pollution control projects. This represents a continuation of our effort to assure that all our installations comply with applicable air and water pollution control critera.

This year's program, which represents a 31-percent increase in authorization over last year, will bring Defense installations into conformance with a provision of Executive Order 11507 which requires that necessary measures to comply with existing pollution control standards to be funded no later than fiscal year 1973.

Basically, the program proposes $106.9 million for 98 projects to provide proper treatment for sanitary or industrial waterborne wastes at our installations.

Included in this year's program for the first time are a number of projects for the collection and onshore treatment of wastes from naval

vessels which represent an important step in meeting the overall problem of handling shipboard wastes.

The air pollution control program totals $63.7 million for 58 projects which involve heating plant fuel conversions to eliminate sulfur and fly ash, facilities for processing industrial exhausts, and the construction of incinerators and sanitary landfills.

So that you may have a clear picture of our air and water pollution programs for the past years, a chart on page 8 of my statement is provided.

All air and water pollution projects in the fiscal year 1973 program have been coordinated with the Environmental Protection Agency, and we plan to use the best available techniques in our project designs. We very much appreciate the strong support given to this program by these committees in the past and your continued support will permit us to achieve our goal of abating pollution at Defense installations.

AIR INSTALLATION COMPATIBLE USE ZONE (AICUZ)

Recognizing the sharply growing threat to military airfields through urban encroachment, we are proposing programs for the Departments of the Navy and the Air Force to acquire land interests around specific installations to assure future compatible use.

The purpose of the AICUZ concept is to secure uses of nonGovernment land around military bases that are compatible with airfield operations. The objective is twofold: (1) to protect the public from the noise and safety hazards associated with jet aircraft operations, and (2) to protect the operational capability of the installations. The concept does not require that the land surrounding the bases remain open space or unused except for agriculture, but rather fosters uses that are reasonably compatible with aircraft operations.

The range of such use would run from agricultural to light industrial plants with built-in sound attenuation, but would exclude residential use with its resulting complaints and suits. The restrictive easement approach also has the advantage of keeping the land on the tax rolls of the community.

The size of the land interest to be acquired varies with the location, mission and size of the airfield, and is based on a composite noise rating for that particular airfield. The land interest to be acquired will, in most instances, be an easement estate which will limit the use of the land surrounding the airfield to one which is compatible with the mission.

The Department of the Navy has programed in the fiscal year 1973 military construction program for the acquisition, by exchange of Government-owned properties, of land interests in 5,125 acres to round out the protection of its Marine Corps air stations at El Toro and Santa Ana, Calif.

Estimated value of the land interest to be acquired is $40.4 million. This project will expand the scope of protective zones to insure full operation of all aspects of the missions of these stations with minimum hazard and nuisance to the surrounding civilian community.

Authorization to acquire the necessary interest in these properties will permit maximum use of exchange authority as contained in the "General provisions" to avoid as much capital outlay as possible while

protecting the large investment of the Federal Government at these stations.

Likewise, the Air Force has programed its inital acquisition of 20,070 acres at three installations: Altus Air Force Base, Okla., Tinker Air Force Base, Okla., and Williams Air Force Base, Ariz., at an estimated value of $12 million.

Acquisition will also be attempted by exchange or donation of land. The Congress can expect to receive future requests for similar purposes as further potential urban encroachment of military airfields becomes evident.

BACKLOG OF CONSTRUCTION

I would now like to briefly cover the backlog of construction, an item which I know has been and continues to be of concern to all of us. The backlog remaining after the fiscal year 1973 program, exclusive of family housing and Reserve Forces facilities, is presently estimated by the services at $26.5 billion, of which $11.7 billion relates to the replacement and modernization of our physical plant. Our family housing programable deficit amounts to $2.3 billion for 93,000 units. The programable deficit is based on the total family housing requirements for military personnel at pay grade E-4 and above, less a 10-percent safety factor, and less adequate assets, both on post and private. The increase in the family housing deficit over last year's reflects the broadening of the program base to include all E-4s. Our facility deficiencies for the Reserve components totals $1.3 billion. Beginning last year, we were able to program the first substantial increment against a 10-year program to liquidate this backlog and as I have mentioned, this year we are requesting an even larger amount to keep the program on schedule.

Despite efforts in recent years to reduce the backlog in facilities other than family housing and Reserve components, the current deficit reflects a substantial increase over last year's $22 billion deficit.

What has happened is that the services have updated their requirements to reflect the current prices which, as you are aware, have been spirally at a rate of 9 to 10 percent annually. They have also picked up the added cost of requirements for support of new weapons systems such as Safeguard and ULMS which are quite substantial.

This year the military departments have reoriented their priorities and have placed special emphasis on "people projects" designed to improve living conditions and enhance recruitment potentials as an assistance in achieving a zero-draft force.

While funds for the replacement and modernization have increased steadily from a low of $175 million in fiscal year 1969 to $479 million in fiscal year 1972, this year's fund request of $658 million reflects a substantial increase over the amount approved in fiscal year 1972.

Although escalating construction costs present a formidable problem, we will continue in our efforts to support a level of funding which would keep pace with our new mission assignments and would liquidate current deficiencies as well as replacement and modification deficiencies in a reasonable time period.

OFFSET AGREEMENT

KASERNE REHABILITATION PROGRAM IN GERMANY

Another item which is closely related to our facilities backlog problem and which had received unfavorable and adverse publicity concerns the accommodations provided our troops in Germany. The Kasernes which house our troops in Germany were constructed, for the most part, in the late 19th or early 20th century according to the European standards of the period. The facilities by U.S. standards are rated substandard with antiquated sanitary facilities, inadequate heat, and lighting and ventilating systems which are harmful to the health and morale of the troops.

The lack of funds has precluded the financing of adequate maintenance and repair of these facilities for several years and deteriorated conditions are clearly in evidence.

Prior to fiscal year 1972, the U.S. Army, Europe, undertook a concentrated effort to upgrade troop living and dining facilities, one Kaserne at a time, as rapidly as funds would permit. Under this "stem-to-stern" O. & M. rehabilitation program some $60 million in Army funds have been obligated at 26 Kasernes and this work should be completed during fiscal year 1973.

As you know, on December 10, 1971, we concluded a new United States-Federal Republic of Germany Offset Agreement. A key feature of the new agreement is an undertaking on the part of the Federal Republic to assume responsibility for a major program to rehabilitate U.S. barracks and other defense-related projects in Germany. The Federal Republic of Germany will spend DM600 million (approximately $183 million) on this program during the period of the agreement. The Commander in Chief, U.S. Army, Europe, and Commander in Chief, U.S. Air Force, Europe, have agreed to an allocation of $175.8 million for Army and $7.2 million for the Air Force.

Army expects to rehabilitate troop barracks facilities in 61 of 94 Kasernes requiring the basic "stem-to-stern" work.

Air Force will start the upgrading of dormitories and dining facilities at eight air bases, leaving an unfunded requirement of $9.6 million to complete the work at these bases.

Contracts have already been let at a number of Kasernes and work is underway. Before we leave this subject, I would like to discuss one further point. In order to finance U.S. participation in the supervision and administration of its share of the Offset Program, the Army has proposed to realine a $6.1 million portion of its fiscal year 1972 MIL CON barracks modernization program. The committees were so notified on April 17, 1972. The committees requested that the proposed action be held in abeyance until it could be discussed at the fiscal year 1973 hearings.

We are of the opinion that the Army proposal represents a very practical, reasonable, and the most advantageous solution to a complex problem and hope that we can successfully resolve this question during the course of these hearings.

NATO INFRASTRUCTURE

Another significant item is our commitment and involvement in the NATO infrastructure program has been a most successful common endeavor, and has been credited with supplying a large part of the cohesion among the allies.

Essential military facilities costing about $3.2 billion have been completed and another $1 billion are under construction or programed. During the first 5-year program-1951-56-the U.S. share was 43.68 percent. This has been progressively reduced to the current share which amounts to 29.67 percent when France does not participate. When France participates, the U.S. share is 25.77 percent. Since fiscal year 1968, the U.S. contribution to the NATO infrastructure program has been funded under "Authorizations and appropriations for military construction, Army."

Now that the program has provided most of the basic facilities required in the common defense, its character is gradually changing. The requirement for major air and naval installations has given way to the new requirement for modernization and expansion of existing basic facilities.

Progress in technology has resulted in a most dramatic change in the communications area. For example, a NATO Integrated Communications System (NICS) is being established to provide a more rapid, secure, reliable, survivable network, and flexible system employing a communications satellite.

In recent years, we have been very successful in securing a large proportion of projects for support of U.S. forces. In the last five annual programs over 56 percent of all national user projects were programed for benefit of U.S. forces, but our contribution remains at 29.7 percent of the program, and we have every reason to expect this favorable ratio to continue.

The most significant benefit has come from our success in persuading our forces from France. The first recoupment phase of the relocation effort was completed with the reimbursement to the United States of $28 million on December 31, 1970. Starting in January 1971, the NATO funds have been made available prior to the expenditure, thus obviating the need to expend U.S. funds for later recoupment from NATO.

The Euro-group-NATO less France, Portugal, United States, and Canada-has confirmed its offer of an additional $120 million to the infrastructure program as part of the European Defense Improvement Program (EDIP). The entire $420 million is to be made available to SACEUR for the NATO aircraft shelter program.

This will relieve the pressure on the regular infrastructure program to allow for the funding of urgent additional projects in the 1971-74 period to cover the costs of the first viable increment of the NATO Integrated Communications System (NICS). I might mention at this time that 360 of the 414 aircraft shelters prefinanced by the United States have been completed, 18 are under contract, and 36 are to be placed under contract soon.

To cover our continuing NATO commitments through fiscal year 1973 and the first quarter of fiscal year 1974, Department of the Army, which has been assigned as the Excutive agent for the NATO infra