Milt E. Nappier March 25, 2009 Combatant Commander Exercise Engagement Stakeholder Leadership Team (CE2 SLT) FY 2009 CE2T2 Fiscal Update 2009 Midyear Review Planning

2 FY 2009 CE2T2 Funding $747M CE2T2 funds available for obligation (less taxes)  O&M -- $670M – 65% of funding issued to date  RDT&E -- $57M (includes $20M for Congressional Adds) % of funding issued  Procurement -- $20M – 100% of funding issued Congressional and Undistributed Taxes -- $21.7M  O&M Undistributed Taxes -- $19.7M  RDT&E Undistributed Taxes -- $1.8M  Procurement Undistributed Taxes -- $.2M OUSD(P&R) Readiness and Training released Midyear Review Planning Guidance March 4, 2009

3 1st Quarter $221,059 33% 2nd Quarter $212,181 32% 3rd Quarter $168,533 25% 4th Quarter $68,231 10% $ 000 1st Quarter Obligations $76,225 11% 2nd Quarter Obligations thru February $259,120 39%  FY09 Apportionment Request reflects how PMs planned to execute O&M CE2T2 programs  OSD(C) required justification to support more than 25% of funding per quarter  Shows how PMs are executing O&M CE2T2 programs as reflected in the Execution Management System (EMS) compared to FY09 Apportionment Request  CE2T2 Program on track to achieve at least 65% obligations by end of 2 nd Quarter (31 March) $ 000 CE2T2 FY 2009 O&M FISCAL OVERVIEW September 2008 February 2009

4 February O&M 2009 Actuals Obligations — Goal 42% Programs below RED line did not meet February % Obligation benchmark for O&M

5 February Procurement 2009 Actuals Obligations — Goal 33% Programs below RED line did not meet February 2009 Obligation benchmarks (Proc 33%; RDTE 46%) February RDT&E 2009 Actuals Obligations — Goal 46%

6 FY2009 Summary of Program Performance February 2009

7 FY2009 Financial Status – O&M Actuals versus Annual Allocations Program Obligation Summary Public Law 31 July: 80% Mid-Year Review (notional): 50% February 2009 Goal: 42%

8 FY2009 Financial Status – Procurement Actuals versus Annual Allocations Program Obligation Summary End of Year Goal: 77% Mid-Year Review (notional): 40% February 2009 Goal: 33%

9 FY2009 Financial Status – RDT&E Actuals versus Annual Allocations Program Obligation Summary End of Year Goal: 90% Mid-Year Review (notional): 55% February 2009 Goal: 46%

10 FY2008 Summary of Program Performance February 2009

11 FY2008 Financial Status – Procurement Actuals versus Annual Allocations Program Obligation Summary

12 FY2008 Financial Status – RDT&E Actuals versus Annual Allocations Program Obligation Summary

Midyear Review Planning -- Formats (Tentative)

Midyear Review (MYR) Scope FY 2008: CE2T2 RDT&E and Procurement Programs FY 2009: CE2T2 O&M, RDT&E and Procurement Programs Notional Midyear Review Benchmarks (Obligation %) Expenditures OUSD(Comptroller) 2008 Midyear Review Guidance quote: “As with any RDT&E account, the main focus when measuring execution performance is expenditures.” — 2008 Midyear Review RDT&E expenditure benchmark was 35% No 2008 MYR guidance on expenditures for O&M or Procurement OFFICIAL MYR GUIDANCE TBD FY 2008: CE2T2 RDT&E and Procurement Programs FY 2009: CE2T2 O&M, RDT&E and Procurement Programs Notional Midyear Review Benchmarks (Obligation %) Expenditures OUSD(Comptroller) 2008 Midyear Review Guidance quote: “As with any RDT&E account, the main focus when measuring execution performance is expenditures.” — 2008 Midyear Review RDT&E expenditure benchmark was 35% No 2008 MYR guidance on expenditures for O&M or Procurement OUSD(Comptroller) MYR GUIDANCE TBD

15 EMS Documentation Use file upload feature in EMS to provide documentation to support obligations, etc.

16 Official format will change – information requested relatively the same Expect several iterations of these charts Significant difference this year – OUSD(P&R) will develop MYR charts based on information in the Execution Management System (EMS) — Documentation must be loaded in EMS to support obligations — OUSD(P&R) will forward draft charts to PMs for coordination

17 Unfunded Requirements (UFRs) Resource Management Plan Internal Reprioritization Midyear Review UFRs are requested for CE2T2 Enterprise wide sourcing  Commands/organizations can reallocate up to $500K O&M internally – Appropriation and service boundaries must be adhered to – These reallocations must be reported during periodic JIPT meetings  Command/organizations can reallocate up to $1.5M O&M internally – Appropriation and service boundaries must be adhered to – These reallocations require Director, Readiness and Training Policy and Programs (RTPP) approval  Reallocations greater than $1.5M in O&M require Deputy Under Secretary of Defense, Readiness (DUSD(R)) approval RDT&E and Procurement Reallocation  Must follow JIPT and SAG approval thresholds as O&M appropriation  Can only be made in accordance with applicable fiscal law and procedural guidelines Prioritized Unfunded Requirements Due 3 Apr 09

18 Unfunded Requirements (UFRs) Rules of Engagement UFRs must be approved at GO/FO/SES level and submitted to Mr. Gardner with a copy to Mr. DiGiovanni and Milt Nappier UFRs must be prioritized by command/organization OUSD(P&R), in coordination with the Joint Staff, JFCOM and Services (GO/FO/SES level) will prioritize UFRs across CE2T2 Enterprise O&M UFRs – Submission Limits  COCOM HQ Joint Exercise Support via Joint Staff – 5 maximum  Joint Staff – 3 maximum  JFCOM – 5 maximum  Services – 2 per Service RDT&E and Procurement  Three UFRs per appropriation In addition to merits of each UFR, following will also be considered  March 31 st (midyear review) benchmarks  Funds unobligated at end of FY2008 Prioritized Unfunded Requirements Due 3 Apr 09

19 5 MarchFinalize Obligations & Expenditure Plans in EMS 5 MarchEMS Update (February Actuals) 5 MarchLoad/Update Obligation and Expenditure Documentation in EMS 3 AprilUnfunded Requirements Due 5 AprilEMS Update (March Actuals) 31 Jul 09 80% O&M Must Be Obligated Action Items

20 BACKUP

21 DoD Obligation and Expenditure Goals FY 2009 REQUIRES OUSD(COMPTROLLER) CONCURRENCE