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Thank you very much Admiral. Super kudos to those “594 tough”who are sticking in here today despite the weather. So, thank you for that. And more importantly, thank you for all you do in support of Submarine Industrial Base and the Submarine Force. I recognize full well that none of this would happen if it wasn’t for the hard work of folks like you.I love the job I’m in. It is the best job in the Pentagon, if you have to be in the Pentagon. I’m passionate about it.

VADM Connor showed the Undersea Dominance Campaign Plan, the Six Lines of Effort,and that certainly is the overall blueprint. The strategy by which we execute that plan is the Integrated Undersea Future Strategy (IUFS), and if you attended the NDIA Fall Conference last year, I talked about it. I told you that I was going to promulgate the IUFS for Industry—because if you grabbed the IUFS off the shelf from my office, it’s a 3-inch binder that’s classified SECRET,and that’s not very helpful to you.

So, in late October last year, I promulgated that.It’s just a 3-page document and it’s classified FOUO Distro D.You should have seen that. If you haven’t seen it, we’ll make sure you can get a copy through the appropriate electronic channels.

I speak to the submarine league three times a year and I try to come up with something different each time to keep it interesting. So, I thought this time I would essentially grade myself on the IUFS for Industry. If you’ve read it, you should know I’m walking right through the document.

So, the first challenge is to fully fund Ohio Replacement. That’s no surprise. That’s at the lead of the strategy’s plan. As we sit here right now, we are fully funded. I think it speaks volumes that during the recent continuing resolution we continued to maintain the funding. Not everybody can claim that. So, that definitely shows the resolve of the leadership to ensure that this stays on track.

We do have an affordability goal of $4.9Bfor the cost of each of the follow on hulls,two through twelve. Since we last met,our 2014 cost estimate is now down to $5.2B. That started up in the $6B-$7Brange. We’ve cut a lot of things to bring down cost, and we continue to bring that cost down.

From a cutting standpoint, we’re constantly guarding to ensure we don’t cut too much. That said, I can look you in the eye and tell you that we are delivering the core essential military capability that is needed to ensure our strategic deterrence through the 2080s. That’s not a small task. Who will our friends be in 2074? Who can we have overflight of in 2063? All those kinds of issues weigh heavily on what went into this process.

There’s also a Submarine Unified Build Strategy (SUBS) effort in progress to figure out the build approach between Ohio and Virginia and kind of get at some of this cross-class efficiency. That effort’s going on out of Mr. Stackley’s office and RADM Johnson’s shop and includes savings like using the same hydraulic pump on Virginia on Ohio Replacement. We’re working hard on this.

There’s still work to doon affordability. This is one where you’re either getting better or you’re getting worse. You’re never standing still.But, we are fully funded and I think you heard VADM Mulloysay numerous times, “Despite Sequestration we fully plan on an Ohio Replacement to be funded.”

Stable requirements fall squarely in my lane. The CNO signed, in August of 2012 a Service Capability Development Document (CDD) for the Ohio Replacement; not required. But, we did one to demonstrate stable requirements. Now, I’m not saying that we haven’t made some changes. There’s essentially two. One deals with a large vertical array and the other deals with space and weight for coating. Those things were already thought of in defining Objectives. It’s just now, they’re going to be Thresholds. But, that’s pretty darn good for something that was formally conceived in the 2010 time frame. I think there are some folks in the procurement business that might wish they had that level of stability. We had our Resources and Requirements Review Board (R3B) last week andthe Navy has formally endorsed the Ohio Replacement requirements.I’m on track for the Joint Requirements Oversight Council (JROC) to review the requirements in May.So, that’s very good news. That’s actually at or ahead of PIM, to be frank.

Construction is on track, but this is another area where you’re either getting better or you’re getting worse. You’re never standing still. We have a lotto do between now and 2031—and to be clear, it’s October of 2030, Fiscal year 2031. We have a lot to do before that first patrol and we can’t let up a bit. I think a lot of you are familiar with the recent big missile tube contract and lots of great work there and my hat’s off to those in the audience who have been a part of that. It’s huge.

My characterization of getting top-line relief is that challenges still remain.An Ohio Replacement is going to be built. It’s the rest of the Navy that we have to worry about impacting.

Okay, let’s talk about SSBN operational availability. Under VADM Connor’s leadership we have this thing called the SSBN Employment Working Group.We have a very detailed POAM on ensuring that this asset—which is currently carrying about 55% of our nation’s nuclear warheads on it, and that’s going to 70% in February of 2018—has the operational availability to meet strategic requirements until relieved starting in 2031. 70% is a big number.We have a lot of eggs in this basket. That’s why Ohio Replacement has to remain on time, but to make sure we can get to Ohio Replacement, we’ve got to make sure that the Ohio Class submarine stays on track. My piece is making sure we’re fully funding all 14 of the Ohio Class SSBN’s to end-of-life.

As a result of the Nuclear Deterrent Enterprise Review (NER), we’re spending $2.2 billion dollars’ worth of resources to restore margin in the existing sea based strategic deterrent. You’ve probably heard about the additional shipyard employees, three maintenance periods going to private shipyards, infrastructure and training improvements, and the director of SSP taking an oversight role. In the end,the NER was good for not just the SSBN Force, which was a focus point, but there are second and third order effects that are helping the rest of the Submarine Forceas well. A high tide floats all boats.If you’re improving the availability of SSBN shipyard work, that’s also helping SSNs because you’ve got to fix both to fix one. So, there’s good news there too.

The next challenge contained in the IUFS is building two VIRGINIA class per year through 2025. From a Block III standpoint, we’ve delivered our first boat. Even with the 20% design change in the submarine, it was delivered ahead of schedule. Granted,it was a photo finish, but you get credit when you get credit.

Block IV, was the largest shipbuilding contract signed in the history of the United States.The contract essentially boughtten submarines for the price of nine, and saved$5.4 billion dollars. That’s a tremendous return on investment. You know, nothing succeeds like success. VADM Connor calls it the secret sauce that allows us to have credibility. You combine that secret sauce with the eye-watering operations we’re doing at highly classified level, that’s what gives us the credibility to continue to make our case.I think I’ve been to the Hill a dozen times in the last month alone. Those are the two points that I’m able to lead with to make our case for other programs. So, just great work here too.

On Block V, we continue to build two per year within the Future Years Defense Plan (FYDP). The “trough”hasn’t gotten any deeper. It’s still a low point of 41SSNs in 2029. The overall strategy in the current 30-year Ship Building Plan is no more than two submarines per year -total. That’s SSNs and SSBNs combined at any time. The effect is building only one SSN instead of two during years we build Ohio Replacement. We never give up on Service Life Extensions (SLE) to mitigate some of the “trough”, but you can only get so much out of that.As we get into the IPMP boats, that ability is gone because those boats burn more fuel as they move around. So, our ability to extend service life in any meaningful way is going to go away.

The only two levers really left are building two VIRGINIAs at the same time you build an Ohio Replacement, or building three VIRGINIAs in a non-Ohio Replacement year. So, that’s going to be the conversation for those of us trying to do more than just mitigate the “trough”, but rather make it go away. That’s going to be a very, very tough conversation given the fiscal environment we’re in. The SUBS effort I alluded to before is taking a look at whether or not we can do this. That’s about all I can really say here.

Next in the strategy is the Virginia Payload Module(VPM). I tell people all the time, it is not the Virginia Tomahawk Module. It is the Virginia Payload Module.We have lots of payloads that we are very interested in. If you read the CDD, you can see how we built in payload flexibility. You can take the Universal Launch Recovery Module (ULRM) and put it into a VPM to allow us to launch the Large Diameter UUV (LDUUV)and ultimately a Shallow Water Combat Submersible (SWCS), which is a follow on to the Seal Delivery Vehicle. There’s two examples of non-kinetic payloads, if you will. There are also other payloads like the advanced missiles VADM Connor alluded to. I can’t say more about it here other than we’re very excited about the potential,and there’s some real money being applied towards the effort, and we’re working very hard to make it happen. So, it is much more than just the Tomahawk. The really good news here is that we had found the VPM outside the FYDP about a year ago and through some great work down at OSD and making our case, I’m happy to say that when you look at the this year’s FYDP you’ll see that it got accelerated and moved back to FY19. That helps fix the strike “trough”, which is separate from the SSN force structure “trough” that occurs when we lose 60% of our strike volume when those four SSGNs retire in ’26 through ’28. So, gaining that back is huge.

We didn’t initially have the money to pay for all of VPM. So, not only do we get it accelerated, but we got OSD to help pay for it. It’s now one VPM per year.So, if you do that starting in ’19 you get a total of fifteen. You get five in Block 5, five in Block 6 and five in Block 7, but full strike volume recovery following the 60% drop is not possible. What I would like to do is get VPM on the remaining 5 boats, for a total of 20, and that recovers our strike volume to within 5%. That’s what I’ll be pushing,and I encourage you,when you’re able to, do the same.

Next, when you think acoustic superiority program you should think three things. Well, first you think SOUTH DAKOTA. SOUTH DAKOTA is the prototype platform, if you will. And there’s a three-legged stool to SOUTH DAKOTA. One is additional quieting initiatives in the engine room. There’s about a dozen of them. Two is an advanced coating, and three is a large vertical array that’s very similar to the arrays on DALLAS and MARYLAND today.That’s the three parts. It gets classified very quickly.So, that’s about all I can say here, but I can tell you that we have tremendous fleet support. From a funding standpoint I can’t give you an evaluation now either, because it’s a POM-17 issue and we’ll be fighting for this. This is a big part of the future.

Platform upgrades; SWFTS (Submarine Warfare Federation of Tactical Systems) has been a real tough pill to swallow. In the two main budget cycles that I’ve done as Director of Undersea Warfare, I’ve take $809M(FYDP) in cuts during those two budget cycles. That’s just crushed me. In fact, Congress brought it below the MSR, Minimum Sustaining Rate, which is essentially eight units and I’m going to fix that in POM-17. I’m going to put the money back into it. I’ve got to, but it’s indicative of what I’m going to talk about later when I talk about this thing called the last tactical mile.

Earlier, I referred to a recent NUWC trip where myself and RADM Johnson had a great session on towed array reliability with the CNO. As I said earlier, we’ve got to do better. The TB-33 didn’t work, for a lot of reasons that I won’t get into here. We lost a generation of an array when we lost the TB33.

So, we have a four-part plan to fix the TB-29 reliability. Step one is to triage existing arrays. It primarily gets to what we call “green modules,”which is a module that has all the engineering changes,that are available to it,made.Four of the fifteen total modules are high failure rate modules. Right now, the triage is to get every deployer to have those four modules green and by the end of the year to have all deployers with an entirely green array.

That’s the initial triage. We’re already starting to see an effect there, moving the needle.

I’d say we’re probably at40% reliability now, but we want to get to 80%. That’s only going to happen with new telemetry approaches. There’s a couple of rapid prototypes that are on the street that are pretty attractive and RADM Johnson is looking at them. CTA and IPEN, I’ll let him talk about those. But we have to take a fundamentally different approach. Lets face it, a TB-29 is a half-mile long, it’s got 14,000 connections,and we soak itin kerosene to make it neutrally buoyant. Then we wrap it around a sausage extruder to deploy it from the submarine.We pinch it and compress it and we keep it on a drumin the ballast tank. Frankly, it’s a wonder the thing works at all.

Beyond triage, we’re working on some rapid prototyping and then ultimately going toTB29X. That’s going to be the thing that’s going to get us from our current40% kind of reliability up to the 80% level. So, the first three legs of that four-part plan are triaging with green modules, rapid prototyping, and the TB29X.

The fourth part is changing the handler. We’re not going to use the pinch roller anymore, but a belt that provides more even distribution of pressure on the delicate parts, the connections. We took a page from the British on this; the Mac Taggart Scott Belt Handler. It’s good engineering and we’ve figured out how to install it during a non-dry dock availability, by divers, in just two days. So, we’re working on towed array reliability.

Heavyweight Torpedo Production Restart is on track, but there are challenges. Despite the pressures I’ve been able to keep the funding. It’s challenging because of all the stuff ADMRichardson said last night. We’ve got to get faster at pulling things across the science andtechnology gap. You know, VADM Connor’s Undersea Rapid Capability Initiative Number four is the torpedo part of that. We areusing a SCEPS engine along withsome other things to allow us to grow longer arms from a torpedo standpoint. I just got done telling you that SWFTS has its challenges due to funding, but we’ve got to have a SWFTSlike model for the torpedoes at some point. It’s not just a TI/APBnomenclature, but the ability to adapt and feedback to the weapon ata much fasterrate. You know, we have these great platforms. We’re able to build them, man them with the best Sailors, deploy, get across the ocean, get underneath the A2AD envelope, but, in the end, we will just have a ringside seat for our own ass kicking ifwe don’t develop a weapon thatcan do all of what it needs to do. We’re working very hard on it,and I’mfunding 145 weapons in the FYDP. Itell you, I had agreat conversation at breakfast with VADM Koenetziand some other folks. I think ADM Miesactually asked me the same question VADM Koenetzi did. “Is there something fundamental about the JCIDSprocess you would have to do to make things better?” I tell you, the biggest thing that we could do to effect change in the acquisition and production process from my standpoint is fixing the testing process. It’s absolutely crazy what we have to do. That’s one of the biggest reasons why we can’t afford, both in budget and time, to build a brand new weapon because of the testing requirements that would be associated with it.

APB5, which isthe next software change to our next torpedowill happen in FY20. This is a software only change, no hardware. We started working on parts of that change in the 2008 time frame. The earliest the change could ever have happenedwas FY14. Now, I’m not getting to it until ’20. That’s disgraceful. That APB, even though it’s just software, will require approximately 175 test shots. That’s unbelievable, let alone the fact that VADMConnor can’t afford to give that much bandwidth from submarines who are trying to do real missions with fewer submarines every year. So, testingis just crushing us.To that end,I’m putting $2.5 million into POM-17 to acceleratemodeling and simulation development.

All right, let me talk about the“last tactical mile”, because this is powerful.

The good news is that everybody recognizes the need for strategic deterrenceand shipbuilding and two per year. I get great, great support. Our story is tight. You know, we have undersea dominance. Even thePresident tells the CNO not to lose undersea dominance. That helps us to fence, if you will, lots of things. But, the one thing that doesn’t have thatadditional external pressure is all the stuff that falls into what I call the “last tactical mile”.

Here’s an example. My Total Obligation Authority (TOA) is about $20B/year. When FY17 enteredthe FYDP in FY13, the discretionary part of my TOA, the stuff that contributes to that “last tactical mile” (sonar systems, fire control systems, imaging systems, EW systems, torpedoes, counter-measures) was 18%. Now, as we start to work on POM-17, that’s down to 8%. I just got done talking about SWFTS.That’s one of those things that getscut. We’vegone through all that trouble to build the submarine, get across the ocean and get under the A2ADenvelope and now you havethat “last tactical mile”. So, I got less to start with and it hurts more when you take it. You take one dollar from 100 it’s one thing, but you take one dollar from ten dollars and it hurts a lot more. So, that’s my challengeright now.

If you were looking at the “last tactical mile” for strategic deterrenceit would be whole, except fortorpedoesbecause we don’t, we don’t put enough torpedoes on our SSBNs. On the SSNside of the house, we are not whole andit’s amazing to me that about $167 million a year is all I need to buy back all of that “last tactical mile”. In the large scheme of things, it’s really not a lot to ensure we maintain undersea dominance.

Okay, in the interest of time here I’m going to accelerate through this.LDUUV is on track for FY ’22. I’m not the resource sponsor, but I care a lot about it because the synergistic effect of a UUV and a submarine together is unbeatable. Both can do things or go places where the other can’t. Both can leverage off the endurance and the persistence of the other. One can do dull, dirty and dangerous andallow the manned platform to essentially bein two places at once. It’s hugeand it’s a big part of how we’re going to help mitigate that trough in the 20’s.

We care a lotabout this. I’mconnected at the hip with the N2N6to make sure we get those requirements right. VADMConnor mentioned a real-world mission, using a smaller UUV, a Remustype vehicle, coming out of the dry-deckshelter. That’s a real-world mission in the hands of the Combatant Commander today. Very,very exciting.

Fleet ModularAUV is kind of indicative of that. It’s taking a Remus-600 and launching it from a TLAMcapsule. We have lots of TLAM capsules. Our Sailors know how to handle them. Every submarinecan do this. You don’t need a UUV cadreembarked. You don’t need a dry deck shelter. Granted it’s a one-way mission for the Remus, but there might be some things that are very,very high value andstrategic in nature, where that’s worth the cost.We’ve got money in it and will conduct a demonstration during SCC operations soon.

Universal Launch and Recovery Module (ULRM)… I have this tin cup in my office with ULRM written on it. Funding this hasbeen a tough one. We keeplosing ground on that. The shore demo was completed successfully, but I’ve had to delay the at-seademo. Now,the at-sea demo is scheduled for the third quarter of thisyear. I’m frustrated by thatbecause I haveto get ULRM delivered by ’21 to support the ’22 delivery of LDUV. That said, PB-16 has in it, for the first time, programmed (not tin cup) funding for ULRM. We’re making progress.

I already mentioned the top three prioritiesand they are interwoven in the larger story. A lot of the stuff, I’ve touched on. In the interest of time I won’t repeat them here. I feel confident that our message is strong. It’s the resources that are required,and we’re doing our best to ensure that we keep those flowing.

Alright, well thank you for the opportunity to address you here today. More importantly, thank you for all you do to advance the U.S. Submarine Force and maintain undersea dominance.

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