DSCA OVERVIEW

2. SECURITY COOPERATIONKEY POLICY TOOL FOR THE 21st CENTURY Security Cooperation is an integral part of the United States peacetime engagement strategy and directly contributes to American national security and foreign policy objectives. Ongoing security cooperation efforts support the primary foreign policy goals of safeguarding American security, building American prosperity, and promoting American values. By enhancing the capabilities of U.S. friends and allies to address conflicts, humanitarian crises, and natural disasters, it is less likely that American forces will be called upon to respond to regional problems. Strengthening deterrence, encouraging defense responsibility sharing among allies and friends, supporting U.S. readiness, and increasing interoperability between potential coalition partners through the transfer of defense equipment and training help security partners defend against aggression and strengthen their ability to fight alongside U.S. forces in coalition efforts. Security cooperation enables us to cement mil-mil relationships, promote our forward presence, foster military cooperation through interoperability, promote stability within the region, manage regional crises, and deter aggression against our friends and allies. Through these contributions, security cooperation programs lend support to the major U.S. foreign policy goals of promoting political and economic freedom, encouraging development, and helping to improve the quality of life of others. Security cooperation helps to promote the principles of democracy, respect for human rights, and the rule of law. In addition to making the world a safer place, the spread of democratic principles contributes to a political environment more conducive to the global economic development so critical to the nation's well-being. Thus, there is a genuine linkage between foreign military assistance programs and the day-to-day lives of Americans. Security Cooperation is an integral part of the United States peacetime engagement strategy and directly contributes to American national security and foreign policy objectives. Ongoing security cooperation efforts support the primary foreign policy goals of safeguarding American security, building American prosperity, and promoting American values. By enhancing the capabilities of U.S. friends and allies to address conflicts, humanitarian crises, and natural disasters, it is less likely that American forces will be called upon to respond to regional problems. Strengthening deterrence, encouraging defense responsibility sharing among allies and friends, supporting U.S. readiness, and increasing interoperability between potential coalition partners through the transfer of defense equipment and training help security partners defend against aggression and strengthen their ability to fight alongside U.S. forces in coalition efforts. Security cooperation enables us to cement mil-mil relationships, promote our forward presence, foster military cooperation through interoperability, promote stability within the region, manage regional crises, and deter aggression against our friends and allies. Through these contributions, security cooperation programs lend support to the major U.S. foreign policy goals of promoting political and economic freedom, encouraging development, and helping to improve the quality of life of others. Security cooperation helps to promote the principles of democracy, respect for human rights, and the rule of law. In addition to making the world a safer place, the spread of democratic principles contributes to a political environment more conducive to the global economic development so critical to the nation's well-being. Thus, there is a genuine linkage between foreign military assistance programs and the day-to-day lives of Americans.

4. SECURITY COOPERATION PROGRAMS and TOOLS

5. AGENCY VISION

6. DSCA MISSION DSCA provides timely and effective direction, supervision, and oversight of security cooperation programs in support of U.S. National Security and foreign policy objectives. The agency promotes stable security relationships with friends and allies through: Security Assistance and defense sales Humanitarian Assistance and Mine Action Other related programs, e.g. Warsaw Initiative 

7. DEFENSE SECURITY COOPERATION AGENCYDSCA Recent reorganization moved several functions within the agency. Most notably, is the expansion of the Program Support Directorate/PSD. This expansion resulted in a re-naming of PSD to The Policy, Plans and Programs Directorate/P3, and the establishment of a Programs Division. This division will assume responsibility for Performance Based Budgeting/PBB and Performance Based Costing/PBC; Continuous Process Improvement (Reinvention) and Business Process Reengineering/BPR.Recent reorganization moved several functions within the agency. Most notably, is the expansion of the Program Support Directorate/PSD. This expansion resulted in a re-naming of PSD to The Policy, Plans and Programs Directorate/P3, and the establishment of a Programs Division. This division will assume responsibility for Performance Based Budgeting/PBB and Performance Based Costing/PBC; Continuous Process Improvement (Reinvention) and Business Process Reengineering/BPR.

9. DSCA INTERFACE WITH ORGANIZATIONS

10. FUNCTIONAL VIEW OF SECURITY COOPERATION COMMUNITY(FMS, FMF Admin Budgets & DoD Admin Budgets; Reimbursable: CAS Budget + USG in FMS Cases)  DSCA sits atop what we call the SC community �iceberg.� The entire SC architecture includes over 10,458 work years spread throughout the military services, field agencies and activities, Unified Commands, and Security Assistance Offices representing organization located in CONUS and around the world. These work years represent: Full and part-time USG and contract employees funded from the FMS, FMF, and DoD Administrative Budgets USG employees funded from the Contract Administrative Services (CAS) Budget Full-time USG employees funded directly from FMS cases The military services work years represent a significant decrease compared to several year ago as implementing agencies right-sized due to past budgetary constraints. This includes about 979 security assistance billets in 102 countries. DSCA sits atop what we call the SC community �iceberg.� The entire SC architecture includes over 10,458 work years spread throughout the military services, field agencies and activities, Unified Commands, and Security Assistance Offices representing organization located in CONUS and around the world. These work years represent: Full and part-time USG and contract employees funded from the FMS, FMF, and DoD Administrative Budgets USG employees funded from the Contract Administrative Services (CAS) Budget Full-time USG employees funded directly from FMS cases The military services work years represent a significant decrease compared to several year ago as implementing agencies right-sized due to past budgetary constraints. This includes about 979 security assistance billets in 102 countries.

11. DSCA has a dynamic interface with Capitol Hill. Our agency is authorized by the Secretary to maintain a legislative liaison mission due to the unique role we play in foreign affairs. With the recent change in leadership of the Senate, the new SACFO Chairman is interested more in development programs than military assistance While the SFRC has operated on a more bipartisan basis, arms transfers may be more difficult under the new leadership DSCA has a dynamic interface with Capitol Hill. Our agency is authorized by the Secretary to maintain a legislative liaison mission due to the unique role we play in foreign affairs. With the recent change in leadership of the Senate, the new SACFO Chairman is interested more in development programs than military assistance While the SFRC has operated on a more bipartisan basis, arms transfers may be more difficult under the new leadership

12. SECURITY COOPERATION PROGRAM FMS BUSINESS 2002 GRANT ASSISTANCE 2002 & 2003 Sales - $11.8B � FMF - $3.65B (02) + ($45M - Sup) Deliveries - $14B - $4.107B (03) 13K Open Cases - $221B � IMET - $70M (02) Pipeline - $56B - $80M (03) $5.5B in FMS Customer Trust Fund ~130 Countries DOD PROGRAMS 2002 RESOURCES 2002 Humanitarian Assistance � FMS & FMF Oper. Budgets - $383M in 120+ Countries - $29.8M � FMS & FMF Work Years (WY) � 10,458 Humanitarian Mine Action � FY02 DoD O&M $2.6M HQ Budget in 24 Countries - $19.6M � DoD Work Years (WY) - 38 Warsaw Initiative - $37.3M Canadian Environmental Program - $10.9M FMS business is healthy as evidenced by the sales and pipeline figures Sources of funding for the Security Cooperation Program include: Department of State Foreign Operations Appropriations that provide Foreign Military Financing and International Military Education and Training funding and; Department of Defense Appropriations that provide funding for Overseas Disaster, Humanitarian, and Civic Aid (ODHCA), WI, and CEP. Sources of funding to operate the Security Cooperation program come from three sources: FMF Operating Budget ($32.838M) DoD Operating Budget ($2.4M) FMS Administrative Surcharge (ceiling of $340M) FMS business is healthy as evidenced by the sales and pipeline figures Sources of funding for the Security Cooperation Program include: Department of State Foreign Operations Appropriations that provide Foreign Military Financing and International Military Education and Training funding and; Department of Defense Appropriations that provide funding for Overseas Disaster, Humanitarian, and Civic Aid (ODHCA), WI, and CEP. Sources of funding to operate the Security Cooperation program come from three sources: FMF Operating Budget ($32.838M) DoD Operating Budget ($2.4M) FMS Administrative Surcharge (ceiling of $340M)

13. FY 2002 FMF ALLOCATION The pie is divided to reflect U.S. Policy priorities. The vast majority of FMF goes to the Middle East to promote regional peace and security. Overall, recommended FMF funding for FY02 is up 3.9% from FY01 levels (excluding supplemental funding). Regionally, the funding level increases (from FY01 to FY02) are: AFR 6%; EAP 381%; EUR 21%; NEA 2%; NIS 23%; SA 0%; WHA 362% Discretionary funding for FY02 has increased 32% over last year when supplemental funding is not considered. However, in comparison to earmarked funding levels, this is only 9% of the total FY02 FMF budget. Of the $97.5M in PfP funding, $76.85 is provided to countries in Europe and $20.65M is provided to the New Independent States. This funding is used mainly to ready these nations for democratization efforts and entry into NATO. Africa: $10M for Nigeria In the Pacific, Philippines is receiving $19M for modernization initiatives $8M for enhanced international peacekeeping capabilities (EIPC) which is an initiative to increase peacekeeping capabilities of �focus� countries by providing equipment and training The pie is divided to reflect U.S. Policy priorities. The vast majority of FMF goes to the Middle East to promote regional peace and security. Overall, recommended FMF funding for FY02 is up 3.9% from FY01 levels (excluding supplemental funding). Regionally, the funding level increases (from FY01 to FY02) are: AFR 6%; EAP 381%; EUR 21%; NEA 2%; NIS 23%; SA 0%; WHA 362% Discretionary funding for FY02 has increased 32% over last year when supplemental funding is not considered. However, in comparison to earmarked funding levels, this is only 9% of the total FY02 FMF budget. Of the $97.5M in PfP funding, $76.85 is provided to countries in Europe and $20.65M is provided to the New Independent States. This funding is used mainly to ready these nations for democratization efforts and entry into NATO. Africa: $10M for Nigeria In the Pacific, Philippines is receiving $19M for modernization initiatives $8M for enhanced international peacekeeping capabilities (EIPC) which is an initiative to increase peacekeeping capabilities of �focus� countries by providing equipment and training

14. FY 2003 FMF BUDGET The pie is divided to reflect U.S. Policy priorities. The vast majority of FMF goes to the Middle East to promote regional peace and security. Overall, recommended FMF funding for FY02 is up 3.9% from FY01 levels (excluding supplemental funding). Regionally, the funding level increases (from FY01 to FY02) are: AFR 6%; EAP 381%; EUR 21%; NEA 2%; NIS 23%; SA 0%; WHA 362% Discretionary funding for FY02 has increased 32% over last year when supplemental funding is not considered. However, in comparison to earmarked funding levels, this is only 9% of the total FY02 FMF budget. Of the $97.5M in PfP funding, $76.85 is provided to countries in Europe and $20.65M is provided to the New Independent States. This funding is used mainly to ready these nations for democratization efforts and entry into NATO. Africa: $10M for Nigeria In the Pacific, Philippines is receiving $19M for modernization initiatives $8M for enhanced international peacekeeping capabilities (EIPC) which is an initiative to increase peacekeeping capabilities of �focus� countries by providing equipment and training The pie is divided to reflect U.S. Policy priorities. The vast majority of FMF goes to the Middle East to promote regional peace and security. Overall, recommended FMF funding for FY02 is up 3.9% from FY01 levels (excluding supplemental funding). Regionally, the funding level increases (from FY01 to FY02) are: AFR 6%; EAP 381%; EUR 21%; NEA 2%; NIS 23%; SA 0%; WHA 362% Discretionary funding for FY02 has increased 32% over last year when supplemental funding is not considered. However, in comparison to earmarked funding levels, this is only 9% of the total FY02 FMF budget. Of the $97.5M in PfP funding, $76.85 is provided to countries in Europe and $20.65M is provided to the New Independent States. This funding is used mainly to ready these nations for democratization efforts and entry into NATO. Africa: $10M for Nigeria In the Pacific, Philippines is receiving $19M for modernization initiatives $8M for enhanced international peacekeeping capabilities (EIPC) which is an initiative to increase peacekeeping capabilities of �focus� countries by providing equipment and training

15. FY 2002 FMF DISCRETIONARY ALLOCATIONBY UNIFIED COMMAND This chart reflects the discretionary FMF funding broken out by Unified Command as provided in the President�s Budget for FY02. This chart reflects the discretionary FMF funding broken out by Unified Command as provided in the President�s Budget for FY02.

17. INTERNATIONAL MILITARYEDUCATION AND TRAININGBY STATE REGION The IMET program is perhaps one of the most cost-effective components of the Security Cooperation program. Last year, it supported grant military education and training for more than 9,000 foreign military and civilian defense personnel. By attending courses and programs in the United States, future leaders of foreign defense and defense-related establishments are exposed to U.S. values, including respect for human rights, democratic institutions, and the role of a professional military under civilian control. Since 1991, the IMET program has expanded to nearly 30 new countries, primarily in Central Europe and the New Independent States of the former Soviet Union. The trend is to increase IMET funding significantly (annual increases of approximately 25%) over the next 3 years. The IMET program fosters military-to-military relations and promotes military professionalism, both of which are key to the ability to conduct combined operations quickly and effectively and to enhance the self-defense capabilities of U.S. friends and allies. The regional commanders in chief rely on IMET as a key part of their engagement plans. IMET courses fall into three categories: 50 percent Professional Military Education (e.g., Command and General Staff College); 30 percent Expanded IMET (e.g., Civil-Military Relations); and 20 percent technical training (e.g., aircraft engine repair). Under Expanded IMET (E-IMET), international military and civilian students increase their ability to absorb and maintain basic democratic values by addressing issues of military justice, respect for internationally recognized human rights, effective management of defense resources, and improved civil-military relations. The IMET program remains one of DoD's highest priority foreign military assistance programs, and its effective implementation is one of the U.S. military departments' most important international missions. It is one of the least costly and most effective programs for maintaining U.S. influence and assisting countries in their transitions to functioning democracies. FY01 IMET includes $2,875M in supplemental funding for Southeastern Europe The IMET program is perhaps one of the most cost-effective components of the Security Cooperation program. Last year, it supported grant military education and training for more than 9,000 foreign military and civilian defense personnel. By attending courses and programs in the United States, future leaders of foreign defense and defense-related establishments are exposed to U.S. values, including respect for human rights, democratic institutions, and the role of a professional military under civilian control. Since 1991, the IMET program has expanded to nearly 30 new countries, primarily in Central Europe and the New Independent States of the former Soviet Union. The trend is to increase IMET funding significantly (annual increases of approximately 25%) over the next 3 years. The IMET program fosters military-to-military relations and promotes military professionalism, both of which are key to the ability to conduct combined operations quickly and effectively and to enhance the self-defense capabilities of U.S. friends and allies. The regional commanders in chief rely on IMET as a key part of their engagement plans. IMET courses fall into three categories: 50 percent Professional Military Education (e.g., Command and General Staff College); 30 percent Expanded IMET (e.g., Civil-Military Relations); and 20 percent technical training (e.g., aircraft engine repair). Under Expanded IMET (E-IMET), international military and civilian students increase their ability to absorb and maintain basic democratic values by addressing issues of military justice, respect for internationally recognized human rights, effective management of defense resources, and improved civil-military relations. The IMET program remains one of DoD's highest priority foreign military assistance programs, and its effective implementation is one of the U.S. military departments' most important international missions. It is one of the least costly and most effective programs for maintaining U.S. influence and assisting countries in their transitions to functioning democracies. FY01 IMET includes $2,875M in supplemental funding for Southeastern Europe

18. INTERNATIONAL MILITARYEDUCATION AND TRAININGBY UNIFIED COMMAND The IMET program is perhaps one of the most cost-effective components of the Security Cooperation program. Last year, it supported grant military education and training for more than 9,000 foreign military and civilian defense personnel. By attending courses and programs in the United States, future leaders of foreign defense and defense-related establishments are exposed to U.S. values, including respect for human rights, democratic institutions, and the role of a professional military under civilian control. Since 1991, the IMET program has expanded to nearly 30 new countries, primarily in Central Europe and the New Independent States of the former Soviet Union. The trend is to increase IMET funding significantly (annual increases of approximately 25%) over the next 3 years. The IMET program fosters military-to-military relations and promotes military professionalism, both of which are key to the ability to conduct combined operations quickly and effectively and to enhance the self-defense capabilities of U.S. friends and allies. The regional commanders in chief rely on IMET as a key part of their engagement plans. IMET courses fall into three categories: 50 percent Professional Military Education (e.g., Command and General Staff College); 30 percent Expanded IMET (e.g., Civil-Military Relations); and 20 percent technical training (e.g., aircraft engine repair). Under Expanded IMET (E-IMET), international military and civilian students increase their ability to absorb and maintain basic democratic values by addressing issues of military justice, respect for internationally recognized human rights, effective management of defense resources, and improved civil-military relations. The IMET program remains one of DoD's highest priority foreign military assistance programs, and its effective implementation is one of the U.S. military departments' most important international missions. It is one of the least costly and most effective programs for maintaining U.S. influence and assisting countries in their transitions to functioning democracies. FY01 IMET includes $2,875M in supplemental funding for Southeastern Europe The IMET program is perhaps one of the most cost-effective components of the Security Cooperation program. Last year, it supported grant military education and training for more than 9,000 foreign military and civilian defense personnel. By attending courses and programs in the United States, future leaders of foreign defense and defense-related establishments are exposed to U.S. values, including respect for human rights, democratic institutions, and the role of a professional military under civilian control. Since 1991, the IMET program has expanded to nearly 30 new countries, primarily in Central Europe and the New Independent States of the former Soviet Union. The trend is to increase IMET funding significantly (annual increases of approximately 25%) over the next 3 years. The IMET program fosters military-to-military relations and promotes military professionalism, both of which are key to the ability to conduct combined operations quickly and effectively and to enhance the self-defense capabilities of U.S. friends and allies. The regional commanders in chief rely on IMET as a key part of their engagement plans. IMET courses fall into three categories: 50 percent Professional Military Education (e.g., Command and General Staff College); 30 percent Expanded IMET (e.g., Civil-Military Relations); and 20 percent technical training (e.g., aircraft engine repair). Under Expanded IMET (E-IMET), international military and civilian students increase their ability to absorb and maintain basic democratic values by addressing issues of military justice, respect for internationally recognized human rights, effective management of defense resources, and improved civil-military relations. The IMET program remains one of DoD's highest priority foreign military assistance programs, and its effective implementation is one of the U.S. military departments' most important international missions. It is one of the least costly and most effective programs for maintaining U.S. influence and assisting countries in their transitions to functioning democracies. FY01 IMET includes $2,875M in supplemental funding for Southeastern Europe

19. To help give you an idea of the size of the EDA program, this chart provides an overview of approved EDA transfers by dollar value over the past eight years. FY 99 was our biggest year in EDA offers and this is primarily due to large ticket items (i.e., ships, missiles, ammunition and air defense systems). Many excess DoD assets (from Cold War, Bosnia, Korea) have already been disposed of, and the quantity of EDA available has been declining. Items transferred in FY 2001 consisted largely of smaller end items such as vehicles, spares and small arms. Fewer large end items, such as aircraft and ships, were transferred in relation to past years. A congressionally mandated annual aggregate ceiling of $425M (in current value) on EDA grants exists. Many countries which cannot afford to buy new equipment use EDA to help modernize their militaries. While we do not advocate using EDA as the sole source of equipment, it can be helpful since it allows countries to meet many of their needs at a reduced cost. However, EDA should not be thought of as �free.� EDA items are transferred on an �as-is, where-is� basis and most often need extensive repair or upgrade and modification work. EDA can be an opportunity for industry to pick up upgrading and modification work. But most of all, EDA offers an opportunity for foreign customers to get to know US equipment and US quality and to build relationships, both military-to-military and customer-to-industry.To help give you an idea of the size of the EDA program, this chart provides an overview of approved EDA transfers by dollar value over the past eight years. FY 99 was our biggest year in EDA offers and this is primarily due to large ticket items (i.e., ships, missiles, ammunition and air defense systems). Many excess DoD assets (from Cold War, Bosnia, Korea) have already been disposed of, and the quantity of EDA available has been declining. Items transferred in FY 2001 consisted largely of smaller end items such as vehicles, spares and small arms. Fewer large end items, such as aircraft and ships, were transferred in relation to past years. A congressionally mandated annual aggregate ceiling of $425M (in current value) on EDA grants exists. Many countries which cannot afford to buy new equipment use EDA to help modernize their militaries. While we do not advocate using EDA as the sole source of equipment, it can be helpful since it allows countries to meet many of their needs at a reduced cost. However, EDA should not be thought of as �free.� EDA items are transferred on an �as-is, where-is� basis and most often need extensive repair or upgrade and modification work. EDA can be an opportunity for industry to pick up upgrading and modification work. But most of all, EDA offers an opportunity for foreign customers to get to know US equipment and US quality and to build relationships, both military-to-military and customer-to-industry.

20. You will note, there were unprecedented worldwide sales in FY93 of $33B attributed to the Gulf War. US participation in the conflict showcased the superior capabilities of US weapon systems. This drove home the need for interoperable, ready forces. Friends and allies around the world increased purchases to address their military deficiencies. The $33B in total sales was due to a few very large sales, such as aircraft to Finland, Switzerland, Saudi Arabia, Taiwan, and Greece, Patriot missiles to Saudi Arabia and tanks to Kuwait. Sales from FY94 through FY98 were significantly lower reflecting a return to a more routine level of activity in a less active worldwide defense market. However, one should note that over the 21-year period (FY81 to FY00) we have maintained an overall average of $12.4 B in sales when adjusted for inflation. In keeping with this trend, at $13.3 B, FY01 marked a third straight strong year of Foreign Military Sales, coming in $1B higher than the $12.1B reached in FY00. Our two most active regions continue to be the Middle East and the Pacific Rim For FY02 and beyond, please note that the figures are only estimates In Jan 00 P3 wastasked to take a fresh look at our internal forecasting processes. We found our existing processes to be strong. Thus, we strove to build on the existing framework by bringing even more rigor to the forecasting process. Many variables can affect sales figures. Such variables include: Economic downturns Regional conflicts However, we have no reason at this point in time to believe that our out-year estimated sales figures should vary significantly up or downYou will note, there were unprecedented worldwide sales in FY93 of $33B attributed to the Gulf War. US participation in the conflict showcased the superior capabilities of US weapon systems. This drove home the need for interoperable, ready forces. Friends and allies around the world increased purchases to address their military deficiencies. The $33B in total sales was due to a few very large sales, such as aircraft to Finland, Switzerland, Saudi Arabia, Taiwan, and Greece, Patriot missiles to Saudi Arabia and tanks to Kuwait. Sales from FY94 through FY98 were significantly lower reflecting a return to a more routine level of activity in a less active worldwide defense market. However, one should note that over the 21-year period (FY81 to FY00) we have maintained an overall average of $12.4 B in sales when adjusted for inflation. In keeping with this trend, at $13.3 B, FY01 marked a third straight strong year of Foreign Military Sales, coming in $1B higher than the $12.1B reached in FY00. Our two most active regions continue to be the Middle East and the Pacific Rim For FY02 and beyond, please note that the figures are only estimates In Jan 00 P3 wastasked to take a fresh look at our internal forecasting processes. We found our existing processes to be strong. Thus, we strove to build on the existing framework by bringing even more rigor to the forecasting process. Many variables can affect sales figures. Such variables include: Economic downturns Regional conflicts However, we have no reason at this point in time to believe that our out-year estimated sales figures should vary significantly up or down

21. HUMANITARIAN ASSISTANCE PROVIDES: EMERGENCY ASSISTANCE (FOOD, SHELTER, MEDICAL, TRANSPORTATION) NON-EMERGENCY ASSISTANCE (NON-LETHAL EXCESS PROPERTY, TRANSPORTATION OF NGO-DONATED RELIEF SUPPLIES, SERVICES--E.G. MEDICAL AND ENGINEERING) HUMANITARIAN MINE ACTION PROGRAM: PROVIDES UNIQUE TRAINING AND READINESS-ENHANCING BENEFITS TO SPECIAL OPERATIONS FORCES TRAINS HOST NATION TRAINERS TO CLEAR EXISTING MINES DESIGNS SUSTAINABLE INDIGENOUS PROGRAMS PROMOTES HUMAN WELFARE THROUGH MINE AWARENESS/VICTIMS ASSISTANCE HUMANITARIAN ASSISTANCE & MINE ACTION

22. Personnel & Training Guidelines for training and career development programs for DoD civilian personnel in International Affairs jobs Policy foundation in place for SC Internship & Advanced Degree Programs Finance Implementation of use of Standby Letter of Credit in lieu of termination liability pre-payments Improvements to the payments schedule process & case closure Partnering Increased customer participation in contracting process More effective �teaming� of Industry, USG, and Foreign Customers Web-based Customer Assistance Guide Business Processes Enhanced electronic support to the LOA approval process Formal Customer Satisfaction Index

23. Security Assistance Management Manual (SAMM) Rewrite Complete rewrite of SAMM (DOD 5105.38-M) in 2002; Clearly identify what is law/policy/standardization; add/delete details on some topics Letter of Offer and Acceptance (LOA) Quality Working with MilDeps to improve and standardize LOA preparation (now done in DSAMS) New LOA Metric developed to assist in improving timeframes Offsets Identify more clearly contracting officer role in determining reasonableness of costs Change LOA note requirements; define 36(B) requirements End Use Monitoring (EUM) GAO and Congress require more robust EUM New position being created at DSCA; likely tiger teams doing �spot checks� as well as more engaged SAO teams

24. REINVENTION IS OVER: BPR IS NOW PART OF NORMAL BUSINESS BPR is: Changes that will make business processes better, faster, cheaper, and/or more responsive to the customer(s). BPR is the facilitator for innovation! WHY DO BPR AT DSCA? Clinger-Cohen Act of 1996 required that reengineering be considered at appropriate points in a major IT acquisition (e.g. CEMIS). (SECDEF Memo, 2 Jun 97) Director, DSCA directed at the Security Cooperation 2001 Conference that BPR Office would pick-up where reinvention left off, with primary emphasis on business processes.

25. Initiatives Replace Legacy Systems Eliminate Duplicative MilDep Systems Improve and Standardize Systems Improve Communications with International Customers and the Public

26. SOME KEY INFORMATION TECHNOLOGY SYSTEMS SYSTEM STATUS FUNCTION 1. Defense Security Assistance Operational Support preparation of Management Information System Letters of Offer and Acceptance (LOA) (DSAMS) Case Development Module 2. DSAMS Training Module Development Support MILDEP management of Foreign Military Training 3. Case Execution Management Requirements Support Case Execution & Case Information System (CEMIS) Determination Closure with a web-based interface for customers 4. Security Assistance Network (SAN)/ Operational Support SAOs, IMSOs, and Training Management System (TMS)/ customers in managing International Military Student Officer Foreign Military Training (IMSO) Website/ International SAN 5. FMS Credit System Operational Manage Foreign Military Financing 6. Humanitarian Assistance Program � Operational Plan worldwide HA program Internet (HAP-I)

27. THE FUTURE SECURITY COOPERATION REFLECTS ON USG AND DEMONSTRATES COMMITMENT TO SECURITY NEEDS OF OUR FRIENDS AND ALLIES. SECURITY COOPERATION WILL CONTINUE TO BE AN IMPORTANT TOOL FOR POLICY MAKERS. WE CAN EXPECT: CONTINUED SCRUTINY OF FOREIGN AID REQUESTS. CONTINUED PRESSURE TO REDUCE MANPOWER RESOURCES. INCREASED COMPETITIVE MARKET FOR SMALLER DEFENSE BUDGETS.