Sen. Carl Levin, the chairman of the Senate Armed Services Committee, said Tuesday that he would not take issue with South Korea's development of longer-range missiles if they are deployed in a "defense and non-threatening" way.

"If they want to do it in a non-threatening way, totally defensive way at its own expense, I don't have any problem going on," he said at the National Press Club.

South Korea's missile capability is a sensitive diplomatic issue with its top ally, the U.S., and also a politically charged topic at home.

Seoul can't possess ballistic missiles with the range of more than 300 km (186 miles) and a payload heavier than 500 kg (1,102pounds) under a 2001 agreement with Washington.

South Korea's conservatives have been calling for the extension of the range to cover all of North Korea.

The Lee Myung-bak administration has formally raised the issue and it is in consultations with the U.S. government, officials say.

Levin, a Michigan Democrat, said he does not have "any strong feeling" on Seoul's push if it is done in a way that "should not be viewed as a kind of offensive, taking an offensive position or threatening position towards China or toward North Korea."

Asked by Yonhap News Agency if massive budget cuts in the U.S.

will affect its alliance with South Korea, the senator indicated that there will be no reduction in troop levels.

The U.S. has around 28,500 troops in South Korea, a legacy of the 1950-53 Korean War, which ended in a truce, not a formal peace treaty.

"I would hope that there could be some progress in terms of North Korea that would allow us to reduce our troops, the number of our troops in Korea," he said.

He also said the Pentagon should reduce some of the planned spending for housing U.S. soldiers and their families.

U.S. Forces Korea has been working to expand and renovate a base in Pyeongtaek, about 70 km (43.5 miles) south of Seoul, to allow more troops to bring families.

"Particularly, we cannot afford to be spending -- I believe it was a figure like $10,000 a month for family housing, that was planned in order to have families come -- more families come over and be with our troops in Korea. We cannot afford that," he added.

Marine Gen. James Cartwright, retired vice chairman of the Joint Chiefs of Staff, agreed that the allies need to adjust their alliance to meet the change in the security environment.

  "It's time, really, to make an adjustment on the posture," he said, joining Levin at the news conference.

He pointed out that the missile issue is a matter of diplomatic understanding.

"Understanding how all in the neighborhood view that change and that they understand it is a key issue here," he said. "It's probably generally it just takes time to make sure that the logic and the reasoning is well understood by your neighbors before you field something like that.

Meanwhile, the State Department confirmed that Washington is continuing to talk with Seoul on the missile matter.

"We share the Republic of Korea's security concerns, and we cooperate with Seoul to address its needs and we routinely seek to identify ways to improve our planning efforts, which include the full range of alliance capabilities -- including conventional forces, missile defense, nuclear capabilities, and strategy doctrine," a department spokesperson told Yonhap.

"We must consider this issue responsibly and ensure that any steps we take to ensure strong Republic of Korea defense capabilities are consistent with our shared regional and global nonproliferation objectives," the official said on the customary condition of anonymity.

Officials at the press offices of the White House and the Defense Department said they have entrusted the State Department with a formal media response to the matter. (Yonhap News)