Army Manufacture of the Mark 58 Smoke Marker

Gao ID: PLRD-83-58 March 22, 1983

GAO reviewed the Army's plan to start in-house production at an ammunition activity of all Mark 58 Smoke Markers previously produced in part by a private corporation.

The Army is required to have needed supplies made in factories or arsenals owned by the United States, as long as the factories or arsenals can make those supplies economically. Although such a determination normally would have required a comparison of the cost of in-house performance with the cost of performance by potential private sources, it was not necessary in this case, because the Mark 58's had been designated as a mobilization item and the ammunition activity had been selected as the mobilization base producer. By law, an agency head has the authority to negotiate a purchase if the agency head determines that it is in the interest of national defense to have a plant, mine, or other facility or a producer, manufacturer, or other supplier available for furnishing property or services in case of a national emergency. After considering technical expertise and workload at the ammunition activity, the Army decided to obtain the Mark 58's from the activity, and GAO believes that such a decision was clearly within the Army's authority.

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