Force Structure
Actions Needed to Improve Estimates and Oversight of Costs for Transforming Army to a Modular Force Gao ID: GAO-05-926 September 29, 2005In 2004, the Army began transforming its force into modular brigade-based units, thus expanding the number of units available for deployment and creating new command and support units. The Army is transforming while engaged in the Global War on Terrorism and developing other high-cost capabilities. This prompted congressional concern about the affordability of Army plans. Thus, under the Comptroller General's statutory authority, GAO examined the Army's restructuring. This report addresses (1) the extent of change in costs and areas of uncertainty that could affect those costs, (2) the Army's plan for funding modularity and factors that may affect affordability, and (3) whether the Army has an adequate approach to track modularity obligations.
The Army's cost estimates for its modular force are evolving and have increased substantially, and uncertainty exists that will likely increase costs further. In March 2005, the Army estimated it will need $48 billion to fund modularity through 2011, a 71 percent increase from its 2004 estimate of $28 billion. However, this latest estimate does not include $27.5 billion in personnel and construction costs the Army and GAO identified, bringing potential known costs to $75.5 billion. Uncertainties remain in this estimate related to force design, equipment, facilities, and personnel, which could increase costs or require the Army to reduce capabilities. Until the Army provides a more reliable estimate of its modularity costs, DOD and Congress will not be well positioned to weigh competing requests for funding. The Army's funding plan, which it uses as the basis for developing funding requests, relies on annual and supplemental appropriations and may present future affordability challenges. Uncertainty in cost estimates noted above, reliance on business engineering efficiencies that historically have been difficult for DOD to achieve, and likely cost growth from another high-cost program--Future Combat Systems--collectively pose the risk of making this plan unaffordable. Also, the Army will be creating most of the modular units before it has the funding to support them While the Army can generally identify overall equipment purchases, it lacks an approach for tracking most modularity obligations and thus cannot provide a reliable picture of past spending or future funding needs. Army officials said they had not established a framework to track personnel and equipment obligations in part due to the difficulty of defining whether such expenses were incurred specifically for modularity or to support the force in general. However, we note the Army has made such distinctions in its past funding requests, including identifying specific amounts needed for equipment, and will require such data to develop and justify future requests.
RecommendationsOur recommendations from this work are listed below with a Contact for more information. Status will change from "In process" to "Open," "Closed - implemented," or "Closed - not implemented" based on our follow up work.
Director: Team: Phone:GAO-05-926, Force Structure: Actions Needed to Improve Estimates and Oversight of Costs for Transforming Army to a Modular Force
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Report to Congressional Committees:
United States Government Accountability Office:
GAO:
September 2005:
Force Structure:
Actions Needed to Improve Estimates and Oversight of Costs for
Transforming Army to a Modular Force:
GAO-05-926:
GAO Highlights:
Highlights of GAO-05-926, a report to congressional committees:
Why GAO Did This Study:
In 2004, the Army began transforming its force into modular brigade-
based units, thus expanding the number of units available for
deployment and creating new command and support units. The Army is
transforming while engaged in the Global War on Terrorism and
developing other high-cost capabilities. This prompted congressional
concern about the affordability of Army plans. Thus, under the
Comptroller General‘s statutory authority, GAO examined the Army‘s
restructuring. This report addresses (1) the extent of change in costs
and areas of uncertainty that could affect those costs, (2) the Army‘s
plan for funding modularity and factors that may affect affordability,
and (3) whether the Army has an adequate approach to track modularity
obligations.
What GAO Found:
The Army‘s cost estimates for its modular force are evolving and have
increased substantially, and uncertainty exists that will likely
increase costs further. In March 2005, the Army estimated it will need
$48 billion to fund modularity through 2011, a 71 percent increase from
its 2004 estimate of $28 billion. However, this latest estimate does
not include $27.5 billion in personnel and construction costs the Army
and GAO identified, bringing potential known costs to $75.5 billion.
Uncertainties remain in this estimate related to force design,
equipment, facilities, and personnel, which could increase costs or
require the Army to reduce capabilities. Until the Army provides a more
reliable estimate of its modularity costs, DOD and Congress will not be
well positioned to weigh competing requests for funding.
The Army‘s funding plan, which it uses as the basis for developing
funding requests, relies on annual and supplemental appropriations and
may present future affordability challenges. Uncertainty in cost
estimates noted above, reliance on business engineering efficiencies
that historically have been difficult for DOD to achieve, and likely
cost growth from another high-cost program”Future Combat
Systems”collectively pose the risk of making this plan unaffordable.
Also, as shown below, the Army will be creating most of the modular
units before it has the funding to support them.
Comparison of Modularity Restructuring and Funding Schedules:
[See PDF for image]
Note: The Army plan did not include funding data for fiscal year 2004.
While the Army can generally identify overall equipment purchases, it
lacks an approach for tracking most modularity obligations and thus
cannot provide a reliable picture of past spending or future funding
needs. Army officials said they had not established a framework to
track personnel and equipment obligations in part due to the difficulty
of defining whether such expenses were incurred specifically for
modularity or to support the force in general. However, we note the
Army has made such distinctions in its past funding requests, including
identifying specific amounts needed for equipment, and will require
such data to develop and justify future requests.
[End of figure]
What GAO Recommends:
GAO recommends that the Secretary of Defense provide Congress an annual
plan outlining the costs of Army modularity and develop an approach to
track funds obligated for this effort. The Department of Defense (DOD)
agreed on the need to provide Congress better information on Army
modularity, but stated it does not plan to establish an approach for
tracking costs. GAO reiterates the need for the Secretary to provide a
plan for overseeing expenditures for Army modularity in a matter for
congressional consideration.
www.gao.gov/cgi-bin/getrpt?GAO-05-926.
To view the full product, including the scope and methodology, click on
the link above. For more information, contact Sharon Pickup at (202)
512-9619 or pickups@gao.gov.
[End of section]
Contents:
Letter:
Results in Brief:
Background:
Modular Transformation Cost Estimate Has Increased, and Uncertainties
Surrounding Pending Decisions May Increase Costs Further:
The Army's Funding Plan Poses Funding Risks That May Cause
Affordability Challenges in the Future:
Lack of an Approach to Track Funds Obligated for the Modular Force
Limits the Transparency of Funds Used:
Conclusions:
Recommendations for Executive Action:
Matter for Congressional Consideration:
Agency Comments and Our Evaluation:
Appendix I: Scope and Methodology:
Appendix II: Comments from the Department of Defense:
Appendix III: GAO Contact and Staff Acknowledgments:
Tables:
Table 1: Army Schedule for Transforming to the Modular Design:
Table 2: Modular Force Cost Estimates for the Entire Army by Function:
Table 3: Modular Force Funding Plan:
Figure:
Figure 1: Comparison of Army Modularity Restructuring and Funding
Schedules:
Abbreviations:
BRAC: Base realignment and closure:
CBO: Congressional Budget Office:
DOD: Department of Defense:
FCS: Future Combat Systems:
FYDP: Future Years Defense Program:
United States Government Accountability Office:
Washington, DC 20548:
September 29, 2005:
Congressional Committees:
The Army considers its transformation into a modular force to be the
most extensive reorganization of its force since World War II,
requiring large investments in personnel and equipment to restructure a
force now organized in divisions to a modular brigade-based force. By
the end of fiscal year 2006, the Army plans to reorganize its 10 active
duty divisions, expanding from 33 brigades to 43 modular brigade combat
teams, and by fiscal year 2010, create new types of command and support
units. At the same time, the Army is fighting the Global War on
Terrorism and developing other new capabilities such as the Future
Combat Systems (FCS).[Footnote 1] As the Department of Defense (DOD)
requests funds to support these Army initiatives, it is incumbent on
DOD to provide the best available data to justify its resource needs.
Because of the magnitude of the Army's transformation plans and growing
congressional concerns about their affordability, we are examining both
the force structure and cost implications of the Army's transformation
into a modular force under the Comptroller General's statutory
authority. We presented our preliminary observations on the Army's plan
in a March 2005 hearing before the Subcommittee on Tactical Air and
Land Forces, House Committee on Armed Services.[Footnote 2] This report
focuses on the cost of the modular force, with an emphasis on
assumptions related to the active component because these plans were
the most mature at the time of our review. Because of your oversight
responsibilities, we are sending this report to you. Specifically, we
(1) determined the extent of change in the Army's cost estimate for
transforming to a modular force and the potential areas of uncertainty
that could affect those costs, (2) examined the Army's plan for funding
these costs and factors that may affect its ability to afford
modularity, and (3) determined whether the Army has an adequate
approach to track modularity obligations. We will be providing a
separate report on force structure implications of the modular
transformation at a later date.
Overall, our assessment of the cost estimate, funding plan, and the
approach for tracking obligations associated with the modular force
transformation focused on the assumptions underlying cost projections
for equipment, personnel, and facilities as they related to the modular
force proposed by the Army. We examined the processes for developing
them and assessed the estimates against analyses from officials
knowledgeable about each of the cost categories. We found this
information sufficiently reliable for analyzing the assumptions
underlying costs of the modular force and funding plans. Specifically,
to assess change and uncertainty in the cost estimate, we compared the
Army's original rough order of magnitude estimate with updated
estimates and discussed reasons for the changes with Army budget and
programming officials. We also discussed areas of uncertainties with
Army officials responsible for equipment procurement, personnel, and
facilities, including both headquarters and command officials. To
assess the affordability of the funding plan, we examined the plan in
light of our ongoing and previously issued reviews examining Army
assumptions about other high-cost programs and projected efficiencies
expected in the Army's budget. To assess the Army's approach for
tracking modular force costs, we discussed processes used to track
these funds at the command and headquarters levels, and discussed the
Army's existing processes for tracking costs in general with
headquarters officials. We conducted our review from May 2004 through
June 2005 in accordance with generally accepted government auditing
standards. Further information on our scope and methodology and data
reliability assessment appears in appendix I.
Results in Brief:
The Army's cost estimates for transforming to a modular force are
evolving and have increased substantially, and uncertainty exists that
will likely increase costs. As of March 2005, the Army estimated that
it will need $48 billion to fund modular forces--which represents a 71
percent increase from its 2004 estimate of $28 billion.[Footnote 3]
However, this most recent estimate does not include $27.5 billion in
personnel and construction costs the Army and GAO have identified,
bringing the potential known costs to $75.5 billion.[Footnote 4]
Uncertainties remain in assumptions about force structure design,
equipment requirements and shortfalls, personnel costs, and basing,
which could increase costs even more. For example, if the Secretary of
Defense decides to further increase the number of brigade combat teams-
-a decision to be made in fiscal year 2006--increases in equipment,
facilities, and personnel costs may occur. In addition, the amount for
equipment costs included in the Army's estimate is likely understated
because it does not entirely reflect the cost of purchasing all the
equipment needed to bring the currently planned units to the modular
design--and therefore to the level of capability--that the Army
validated in testing. Also, Army officials are uncertain whether the
current end strength authorization is enough to support the modular
conversion, putting personnel costs at risk of increasing if additional
end strength is needed. Finally, the costs of constructing permanent
facilities are uncertain because they have not incorporated recent
proposals for base realignment and closure and restationing of
personnel from overseas. If costs grow due to these uncertainties, the
Army may require additional funding beyond $75.5 billion or need to
accept reduced capabilities among some or all of its units. Until the
Army provides a better understanding of costs associated with the
modular force and a clearer picture of the impact of resource decisions
on the modular force capability, DOD will not be well positioned to
weigh competing priorities and make informed decisions nor will
Congress or the Secretary of Defense have the information they need to
evaluate funding requests.
The Army's 2005 through 2011 funding plan for its modular force, which
relies on a combination of supplemental and regular appropriations and
efficiencies, contains various risks that may pose difficult
affordability challenges in the future. In sum, the Army anticipates it
will fund the $75.5 billion cost for modularity with $10 billion in
supplemental appropriations, $42.5 billion in regular appropriations
(including $4.5 billion achieved through efficiencies), and a GAO-
estimated $23 billion in either supplemental or regular appropriations
to pay for personnel expenses. According to Army officials, the Army
plans to use this strategy to meet its aggressive schedule for
completing its modular conversion and to avoid canceling or
restructuring other programs. It also intends to use its funding plan
as the basis for developing requests for regular appropriations and
supplemental appropriations funds. Several risk factors may impede the
Army's ability to adhere to its plan. First, the Army will be creating
units before funding is available to restructure them. Its schedule for
creating and transforming modular units shows that by 2008, 96 percent
of the 194 active and reserve units will be created by the time the
Army has a little over half of its anticipated funding. Further,
uncertainties in the cost estimate for the modular force noted above
may increase the costs of the conversion. The funding plan also relies
on the Army to produce $4.5 billion from business process reengineering
efficiencies in order to fund new construction for the modular force.
However, the Army's ability to achieve these savings is uncertain
because DOD historically has had difficulty achieving these
efficiencies. Finally, although the bulk of funding for the Army's FCS-
-a high-cost, high-priority Army program--occurs outside modular
transformation time frames, we have reported that the program is at
significant risk for not delivering required capability within budgeted
resources, and that because of the size of FCS, cost growth could have
dire consequences on the affordability of other Army programs.
Collectively, the risks associated with uncertainties in cost
estimates; the Army's ability to find efficiencies; and implementing
two high-cost, high-priority programs could pose challenges for DOD and
the Army in the future.
While Army officials stated they can generally identify overall
equipment purchases, the Army lacks an approach for tracking and
categorizing most obligations related to modularity and thus cannot
provide decision makers a transparent, reliable picture of past
spending or future budget requirements for the modular force. Federal
internal control standards state that agencies should provide
reasonable assurance that an agency's objectives are being achieved
through, among other things, reliable reports on budget
execution.[Footnote 5] While the Army reported obligations of $133
million for its operation and maintenance expenses in fiscal year 2004
for the modular force transformation, Army officials told us that
additional funds were obligated for personnel and equipment, but they
could not specify the amounts. Initial Army estimates indicated that
these costs could have been as high as $496 million. Army officials
told us that they had not established a framework to track these
modularity expenditures in part because of the difficulty in
distinguishing whether such expenses were incurred specifically for the
modular force transformation or to support the force in general. We
note, however, that the Army has made such distinctions in its past
funding requests for the modular force by requesting specific amounts
of funds for equipment. For example, in documentation supporting the
fiscal year 2005 supplemental appropriation request, the Army stated
that it required $4.6 billion for modularity largely to fund equipment,
vehicles, and facilities, and $3.1 billion to repair tanks and handle
other battle losses. Moreover, without centrally tracking and reporting
on equipment and personnel expenditures specifically related to its
modular transformation, the Army cannot determine if the funding it
planned and programmed for this purpose is being spent to meet the
requirements for modularity. In addition, Congress cannot be certain
that the funds it has authorized for fulfilling the Army's modular
conversion requirements were spent for that purpose and that future
funding requests for the modular force are justified in light of those
expenditures.
We made recommendations to DOD to improve information available to
decision makers on the cost of the Army's plans and related
expenditures. In comments on a draft of this report, DOD strongly
disagreed with our findings related to the cost estimate for the
modular force and the uncertainties we cited. DOD stated that its cost
estimate was solid and that any uncertainties would not substantially
change the estimate. For the reasons stated above and as discussed in
the section summarizing these comments, we do not believe the
department is in a position to state that the estimate is solid.
Further, while DOD agreed on the need for improved reporting on
modularity plans, it did not agree to establish an approach for
tracking modularity costs as we recommend. Given the magnitude and
significant cost of the effort, and the fact that DOD has requested
funds from Congress specifically for modularity, we continue to believe
oversight of expenditures is needed. Therefore, we have included a
matter for congressional consideration. Specifically, Congress should
consider requiring the Secretary of Defense to provide a plan for
overseeing spending of funds provided for modularity.
Background:
The Army's modular force transformation, which has been referred to as
the largest Army reorganization in 50 years, encompasses the Army's
total force--active Army, Army National Guard, and U.S. Army Reserve--
and directly affects not only the Army's combat units, but related
support and command and control. Restructuring these units is a major
undertaking because it requires more than just the movement of
personnel or equipment from one unit to another. The Army's new units
are designed, equipped, and staffed differently than the units they
replace, therefore successful implementation of this initiative will
require many changes, such as new equipment and facilities; a different
mix of skills and occupational specialties among Army personnel; and
significant changes to training and doctrine.
The foundation of the modular force is the creation of brigade combat
teams--brigade-size units that will have a common organizational design
and will increase the pool of available units for deployment. The Army
believes a brigade-based force will make it more agile and deployable
and better able to meet combatant commander requirements. Not only does
the Army expect to produce more combat brigades after its
restructuring, it believes the brigades will be capable of independent
action by the introduction of key enablers, such as enhanced military
intelligence capability and communications, and by embedding various
combat support units in the brigade itself instead of at a higher
echelon of command. The Army's objective is for each new modularized
brigade combat team, which will include about 3,000 to 4,000 personnel,
to have at least the same combat capability as a brigade under the
current division-based force, which ranged from 3,000 to 5,000
personnel.[Footnote 6] Since there will be more combat brigades in the
force, the Army believes its overall combat capability will be
increased as a result of the restructuring, providing added value to
combatant commanders.
Although somewhat smaller in size, the new modular brigades are
expected to be as capable as the Army's existing brigades because they
will have different equipment, such as advanced communications and
surveillance equipment, and a different mix of personnel and support
assets. The Army's organizational designs for the brigade combat teams
have been tested by its Training and Doctrine Command's Analysis Center
at Fort Leavenworth against a variety of scenarios, and the Army has
found the new designs to be as effective as the existing brigades in
modeling and simulation.
By 2011, the Army plans to have reconfigured its total force--to
include active and reserve components, and headquarters, combat, and
support units--into the modular design. The plan includes expanding the
existing 33 brigades in the active component division structure into 43
modular, standardized brigade combat teams by fiscal year 2006. Table 1
shows the Army's schedule for transforming to the modular design.
Table 1: Army Schedule for Transforming to the Modular Design:
Active maneuver brigade combat teams added;
2004: 3;
2005: 3;
2006: 4;
2007: 0;
2008: 0;
2009: 0;
2010: 0;
2011: 0;
Total: 10.
Active maneuver brigade combat teams reconfigured;
2004: 10;
2005: 5;
2006: 11;
2007: 7;
2008: 0;
2009: 0;
2010: 0;
2011: 0;
Total: 33.
Active headquarters units;
2004: 3;
2005: 3;
2006: 4;
2007: 4;
2008: 1;
2009: 2;
2010: 1;
2011: 0;
Total: 18.
Active support units;
2004: 6;
2005: 4;
2006: 11;
2007: 12;
2008: 4;
2009: 2;
2010: 0;
2011: 0;
Total: 39.
Total active units;
2004: 22;
2005: 15;
2006: 30;
2007: 23;
2008: 5;
2009: 4;
2010: 1;
2011: 0;
Total: 100.
Army National Guard units;
2004: 0;
2005: 9;
2006: 34;
2007: 13;
2008: 23;
2009: 0;
2010: 0;
2011: 3;
Total: 82.
U.S. Army Reserve units;
2004: 0;
2005: 0;
2006: 4;
2007: 4;
2008: 4;
2009: 0;
2010: 0;
2011: 0;
Total: 12.
Total Army units;
2004: 22;
2005: 24;
2006: 68;
2007: 40;
2008: 32;
2009: 4;
2010: 1;
2011: 3;
Total: 194.
Source: GAO analysis of Army data.
[End of table]
Supporting DOD's goals for transformation while undertaking current
operations is a complex undertaking. In addition to the sheer magnitude
of force structure changes the Army is implementing, the Army's
transformation to a modular force is occurring as the Army is rotating
over 160,000 troops annually into combat theaters to fight the Global
War on Terrorism. As an indication of the progress already made, the
Army reports it has built 5 new brigade combat teams, converted 16
brigade combat teams, and created 16 modular support brigades. In
addition, the Army reports it has made "rebalancing" decisions
affecting over 100,000 military positions in order to make the best use
of its available personnel. This involves creating more units of the
types needed most and eliminating from the force units of lesser
priority.
Legislation has increased the Army's end strength in part to support
the modular reorganization. In the Ronald W. Reagan National Defense
Authorization Act for Fiscal Year 2005, the Army was authorized an end
strength of 502,400 soldiers--a 20,000 soldier increase of the fiscal
year 2004 end strength of 482,400.[Footnote 7] The 2005 act also
authorized the Secretary of Defense to increase the Army's end strength
as high as 512,400 during fiscal years 2005 through 2009 to support the
operational mission of the Army in Iraq and Afghanistan and to achieve
transformational reorganization objectives of the Army.[Footnote 8]
Modular Transformation Cost Estimate Has Increased, and Uncertainties
Surrounding Pending Decisions May Increase Costs Further:
Since the summer of 2004, the Army's cost estimate for transforming its
force through fiscal year 2011 increased from $28 billion to $48
billion in its spring 2005 estimate. While this latest estimate
addressed some of the shortcomings of the initial estimate, and
includes lessons learned developed from operations in Iraq, this
estimate excludes some known costs and includes uncertainties that may
increase the cost estimate further. The Army did not include personnel
costs, which we estimate to total $23 billion over the same time frame,
and also did not include $4.5 billion in construction costs the Army
plans to achieve through efficiencies. When added to the most recent
estimate, the total known costs increase from $48 billion to $75.5
billion.[Footnote 9] Uncertainties in the estimate could cause costs to
increase higher. Pending decisions about the number and design of
modular units, and uncertainties surrounding equipment, personnel, and
facilities costs, may require the Army to request additional funding
beyond $75.5 billion or accept reduced capabilities among some or all
of its units. Without a clearer picture of the Army's resource
requirements, DOD will have difficulty weighing competing funding
priorities, and the Secretary of Defense and Congress will not have
information they need to evaluate funding requests.
Cost Estimate for the Modular Force Has Increased:
The Army's current cost estimate for the modular force transformation
is $48 billion, a 71 percent increase from its initial rough order of
magnitude estimate of $28 billion made in the summer of 2004.[Footnote
10] There were several weaknesses in the initial $28 billion estimate.
Because the modular force designs had not been finalized, earlier
estimates reflected costs based mainly on the existing division-based
design. Further, in constructing the active component portion of the
estimate the Army (1) assumed the costs of adding 15 light infantry,
division-based brigades but did not include costs of restructuring the
existing combat brigades in the force structure; (2) did not include
restructuring of command and support units; and (3) made no allowances
for permanent construction to house and support these units, funding
instead temporary facilities reflecting the Army's assumption that end
strength increases would be temporary as well.
In March 2005, the Army increased its estimate for transforming to a
modular force to $48 billion from fiscal year 2005 through
2011.[Footnote 11] According to Army officials, this most recent
estimate addressed shortcomings of the initial estimate in that it
included funding to (1) both create new units and restructure existing
ones, (2) build permanent facilities to house and sustain the new force
structure, and (3) used the modular design where available as the basis
for estimating costs. Moreover, officials told us that the modular
design had been updated to reflect lessons learned about equipping and
employing the force from ongoing operations in Iraq.
This estimate, however, did not include personnel costs and some
construction costs. The Army reported that increases in end strength
above the appropriated end strength of 482,400 soldiers were assumed to
cost $3 billion per year, but were not tallied as part of the estimate.
According to Army officials, these personnel costs were excluded
because officials from the Office of Management and Budget and in the
Office of the Secretary of Defense provided guidance that modular
transformation was largely equipment related, and thus the Army should
not include such costs. Further, Army officials cited the difficulty in
segregating end strength cost increases due to modularity versus those
due to ongoing operations. For example, units preparing for deployment
to Operation Iraqi Freedom are being reorganized into a modular
organization prior to deployment. While we acknowledge that it may be
difficult to clearly state whether end strength increases associated
with a deploying unit were due to modular transformation or operational
requirements, we believe including these costs in their entirety is
appropriate because (1) the Army has stated it requires an increase in
end strength to accommodate the modular force, (2) it assumes that its
tempo of operations will continue at the same pace through 2011, and
(3) excluding personnel costs would significantly understate the cost
of the modular force. The Army's $3 billion estimate multiplied over
the 7-year period from 2005 through 2011 and including estimates for
inflation totals $23 billion, based on GAO's calculations. In addition
to these personnel costs, the Army did not include an additional $4.5
billion in efficiencies it planned to apply to construction costs
related to the modular force. This assumption is discussed in more
detail in the next section. Adding these known costs for construction
and personnel to the Army's official estimate brings the total
potential known costs to $75.5 billion.
According to Army data and our projection of personnel costs, equipment
accounts for 54 percent of the costs, personnel for 30 percent,
military construction and facilities for 8 percent, and sustainment and
training for 8 percent as well. These figures along with the annual
totals are presented in table 2.
Table 2: Modular Force Cost Estimates for the Entire Army by Function:
Dollars in billions:
Equipping;
2005: $4.7;
2006: $5.8;
2007: $5.4;
2008: $5.9;
2009: $6.5;
2010: $6.7;
2011: $6.0;
Total: $41.0;
Percent of total: 54%.
Personnel;
2005: $3.0;
2006: $3.1;
2007: $3.2;
2008: $3.3;
2009: $3.4;
2010: $3.5;
2011: $3.6;
Total: $23.0;
Percent of total: 30%.
Military construction/facilities;
2005: $0.3;
2006: $0.0;
2007: $0.5;
2008: $0.5;
2009: $1.5;
2010: $1.5;
2011: $1.5;
Total: $5.8;
Percent of total: 8%.
Sustainment and training;
2005: $0.0;
2006: $0.7;
2007: $0.7;
2008: $1.2;
2009: $1.1;
2010: $1.0;
2011: $1.0;
Total: $5.7;
Percent of total: 8%.
Total;
2005: $8.0;
2006: $9.6;
2007: $9.8;
2008: $10.9;
2009: $12.5;
2010: $12.7;
2011: $12.1;
Total: $75.5;
Percent of total: 100%.
Sources: GAO analysis of Army cost estimates for equipping military
construction and facilities, and sustainment and training costs; GAO
projection of Army personnel cost data.
[End of table]
Uncertainty Surrounding Assumptions Could Result in Further Cost
Increase:
While the Army's latest cost estimate addressed several of the
shortfalls in its initial rough order of magnitude estimate,
uncertainties in its latest estimate are likely to cause costs to
increase. We identified the following factors that could affect
equipment, personnel, and facilities costs.
Future Decisions on Design of Combat, Support, and Command Units Could
Affect Costs:
The Army's Campaign Plan calls for a decision by fiscal year 2006 on
whether to create five additional modular brigade combat teams--a
decision that could affect the size and composition of the modular
force as well as its cost. Adding five brigades would provide
additional capability to execute the defense strategy but would require
additional restructuring of people and equipment. If the Secretary of
Defense decides to add five brigade combat teams to the current plan,
the cost for modularity will increase significantly. For example, each
modular brigade combat team under the current design would require
3,300 to 3,700 soldiers, for a potential total of up to 18,500
soldiers. It is not clear whether the Army would have to add this
entire amount to its end strength, however. The Army has begun
initiatives to rebalance the force by converting military positions to
civilian positions, thus allowing soldiers currently in the
institutional force to be moved to the operational force, and by
rebalancing the active and reserve components in the force. To the
extent the Army is successful in reallocating positions under these
initiatives, it may be able to offset some of these requirements of the
additional brigades. In addition to personnel requirements, adding
these brigades to the force structure would add costs for equipment,
facilities, and training.
At the time the cost estimates were set, the Army had not finished the
designs for all support units and command and control echelons.
Refinement of these designs could increase costs if, as the Army fields
these designs, it finds that additional personnel and equipment are
needed to ensure sufficient capabilities. Some Army officials we spoke
with have already expressed concern that command echelon designs do not
have sufficient staff to manage all required tasks. For example, at one
division we visited, officials thought that the command design was
short staffed given their expanded set of responsibilities. As a
result, command staff would have to prioritize the management of daily
tasks and activities such as trend analysis, statistical tracking, and
oversight, while leveraging of historical data to produce lessons
learned and program improvement would have to be performed by
contractors or other civilian staff. In both cases, if the Army finds
that staffing levels in current command designs are not sufficient, it
will have to choose between decreased capabilities or increased
personnel expenses stemming from higher end strength requirements or
hiring civilians or contractors to perform some of these functions.
Equipping Brigade Combat Teams Poses Cost Uncertainties:
Equipping brigade combat teams poses cost uncertainties because the
Army did not use the equipment quantities in the tested design as the
basis for determining equipment costs. Instead, the amount estimated
for equipment reflects costs based upon a lesser modified amount of
equipment that does not necessarily meet the capabilities of the tested
design. The Army determined it could expect to provide this modified
equipment level to units undergoing conversion based on the limitations
of its current inventory of equipment, planned procurement pipelines,
and expected funding.
Further, in estimating its equipment costs for the modular force, the
Army assumed that some equipment from ongoing operations would remain
in operational condition for redistribution to new and restructured
modular units. To the extent equipment is not returned from operations
at assumed levels, it is not clear whether costs of replenishing this
equipment would be considered modularity costs or costs of ongoing
operations. Currently, equipment is wearing out and being consumed at
higher-than-expected rates due to significant usage in current
operational commitments overseas. For example, a Congressional Budget
Office (CBO) assessment indicates that trucks in Iraq and Afghanistan
are being driven roughly 10 times more miles per year than the average
over the past several years. An internal Army assessment also found
that tactical vehicles in Iraq are being utilized 6 to 10 times the
normal operating tempo, dramatically reducing expected service life and
creating significant repair expenses. In addition, the Army's
prepositioned stocks will have to be reconstituted due to their heavy
use in Operation Iraqi Freedom. We recently reported that according to
Army officials, the Army is nearing completion on a new strategy for
its prepositioning programs.[Footnote 12] They told us that
prepositioning will continue to be important in the future and that the
prepositioned sets would be converted to the modular configuration by
2012 or sooner. However, until the strategy is finalized, costs for
converting this equipment remain unclear.
Facilities Cost Estimates Remain Uncertain:
Potential increases in the number of brigades and pending decisions
related to base realignment and closure (BRAC) and restationing of
forces from overseas present considerable uncertainty in facilities
cost estimates. As previously noted, the current estimate does not
include the cost of funding to cover five additional brigades that may
be added if approved by the Secretary of Defense in fiscal year 2006. A
decision to add these brigades would add significantly to the modular
force facilities' funding requirements. Without knowing where these
brigades would be stationed, it is difficult to evaluate funding
requirements for facilities because each base will likely have a
different inventory of facilities in place to house and support such
units. However, according to Army facility planning estimates, each new
brigade combat team would require approximately $300 million dollars in
permanent facilities if there are no existing facilities, such as
barracks and vehicle maintenance facilities, at the proposed site. This
planning estimate does not include facilities requirements for higher
headquarters and support units, which can be substantial. For example,
at Fort Campbell, the facility requirements for support and
headquarters units accounted for $156 million, or 28 percent, of the
$553 million dollar permanent construction requirements for the
installation. None of these costs have been incorporated into the
current estimate.
The impact of decisions related to the BRAC process and DOD's overseas
forces restationing strategy present further uncertainties in the
Army's facility cost estimate. Although recent cost data on BRAC have
been reported, the Army's current modularity facilities cost estimate
predates the availability of the data and the Army has not updated its
estimates accordingly. Both BRAC and the overseas restationing strategy
have the potential to limit the Army's ability to construct new
permanent facilities to support its modularity requirements. The BRAC
commission's decision to close, realign, or reduce the size of military
installations may constrain the construction funding available for the
Army's modular forces, thereby serving to delay the Army's ability to
construct sufficient permanent facilities for its modular force
structure. The overseas restationing strategy aims to determine the
optimum level of overseas stationing of U.S. military personnel and
equipment in order to meet defense strategies. According to the Army,
decisions related to the plan could return approximately 47,000 Army
soldiers to the United States. This would greatly add to the
requirements for facilities as entire units are relocated back to bases
in the United States and soldiers from disestablished overseas units
are transferred to fill the new modular units. The Army will face
severe facilities shortages due to the increased populations within its
continental U.S. installations resulting simultaneously from the BRAC
decisions, overseas restationing strategy, and modular force
restructuring. This increased demand for facilities may force the Army
to make trade-offs in its permanent facility construction plans and may
delay the construction of permanent facilities for its new modular and
restructured units.
End Strength Requirements Are Uncertain and Could Increase Personnel
Related Costs:
Although the Army has estimated that it will require about $3 billion
per year for the 30,000 soldiers it has attributed to meeting the
requirements of transforming to a modular force while conducting
operations related to the Global War on Terrorism, uncertainty about
the need for additional end strength could produce cost growth in
personnel-related expenses. This uncertainty about the total end
strength required for the modular force has been reflected in our
discussions with Army officials, in recent deliberations by Congress,
and in analyses by other research organizations.
* Officials from the Deputy Chiefs of Staff for Personnel told us in
April and June 2005 briefings that the current authorized end strength
of 512,400 active duty soldiers may not be enough to meet modular force
personnel requirements, especially during the transformation process.
In these briefings, officials told us the Army would likely need
522,400 soldiers and possibly more to staff the modular force
structure.
* As a part of deliberations on the National Defense Authorization Act
for Fiscal Year 2006, both houses of Congress have proposed increases
in end strength in part to support the Army's restructuring. The
pending House Defense Authorization Bill increases the Army's end
strength to 512,400, with the option, as necessary, for the Secretary
of Defense to increase the end strength as high as 532,400 for fiscal
years 2007 through 2009.[Footnote 13] The Senate version of the bill
authorizes increasing the size of the force to 522,400 in fiscal year
2006.[Footnote 14]
* Finally, an analysis by the CBO reported that the Army may need as
much as 542,400.[Footnote 15] This end strength assumes that the Army
will add the 5 brigades to make a 48-brigade force and that it will be
unsuccessful in reassigning 30,000 soldiers from the institutional to
the operational force as planned.
Increasing end strength has significant cost implications. Using the
Army's suggested estimate of $70,000 per additional soldier, increasing
the end strength by 10,000 soldiers for a total of 522,400 from 2006 to
2011 would add $4.7 billion to the $23 billion cost estimate. However,
this estimate is conservative, based primarily on personnel salaries
but few other personnel-related expenses. The Army's current estimate
of about $3 billion per year for 30,000 soldiers--a more comprehensive
estimate that includes expenses for institutional and unit training,
relocation, base support, and other items--translates to about $100,000
per soldier. Using this more inclusive per-soldier estimate, we
estimate that it would cost an additional $6.7 billion if the Army were
required to increase its end strength to 522,400.
In written comments on a draft of this report, DOD stated that the end
strength increase was temporary and related solely to current
operations. As discussed in the section of this report on agency
comments and our evaluation, we disagree with DOD's comments on end
strength. We note that the Army's own documents justified the end
strength increase for the dual purpose of transforming and conducting
operations. For example, the Army's approved 2005 Modernization Plan
states that a 30,000 temporary increase in the Army's end strength
enabled the beginning of the modular conversion of active component
combat units. This view is consistent with Army briefings provided
throughout our review that link the end strength increase with the
Army's modularity initiative.
The Army's Funding Plan Poses Funding Risks That May Cause
Affordability Challenges in the Future:
The Army's funding plan for its modular force anticipates a combination
of supplemental and annual appropriations, but risks borne of the fast
pace of transformation, cost growth for the modular transformation, not
achieving efficiencies as planned, and likely cost growth from FCS
could pose affordability challenges in the future. The plan indicates
that the transformation will be paid for with $10 billion in
supplemental appropriations in fiscal years 2005 and 2006, and a total
of $42.5 billion in its regular appropriations from 2005 through 2011.
In addition, the Army anticipates receiving personnel funding to pay
for increased end strength through either supplemental appropriations
or an increase to the Army's base budget. As noted earlier, we project
these costs to total $23 billion, including inflation. Table 3 displays
the annual totals for these funds.
Table 3: Modular Force Funding Plan:
Supplemental appropriations;
2005: $5.0;
2006: $5.0;
Total: $10.0.
Regular appropriations;
2006: $1.5;
2007: $6.6;
2008: $7.6;
2009: $9.1;
2010: $9.2;
2011: $8.5;
Total: $42.5.
Supplemental or regular appropriations for increased end strength;
2005: $3.0;
2006: $3.1;
2007: $3.2;
2008: $3.3;
2009: $3.4;
2010: $3.5;
2011: $3.6;
Total: $23.0.
Total;
2005: $8.0;
2006: $9.6;
2007: $9.8;
2008: $10.9;
2009: $12.5;
2010: $12.7;
2011: $12.1;
Total: $75.5.
Sources: GAO analysis of Army funding plan; GAO projection of Army
personnel cost data.
Note: Figures may not add due to rounding.
[End of table]
The Army intends to use this funding plan in developing funding
requests for funds provided through both regular and supplemental
appropriations.
We note that the total costs reflected in the Army's funding plan are
not specifically identified in the Future Years Defense Program (FYDP)-
-DOD's centralized report for providing DOD and Congress data on
current and planned resource allocations. According to Army officials,
the fiscal year 2006 FYDP, which projects funding requests from fiscal
years 2006 through 2011, included only $42.5 billion of the $67.5
billion the Army plans to request over those years. Of that, only $25
billion was specifically designated in the FYDP for this
purpose.[Footnote 16] The FYDP also included $17.5 billion that the
Army planned to use for modularity over that period according to Army
officials, but these amounts were not specifically identified in the
FYDP. Because the FYDP does not include anticipated requests for
supplemental appropriations, the 2006 FYDP did not reflect either the
$5 billion the Army plans to request in fiscal year 2006 or the $20
billion we project the Army will request from fiscal years 2006 through
2011 to support increases in end strength.
Notwithstanding the potential for increases in the cost of modular
force transformation noted above, this funding plan poses several risks
that may raise difficult affordability questions in the future. First,
when compared to the Army's unit creation schedule, the plan indicates
that the Army will be creating units before it has the funding
available to resource them, as shown in figure 1.
Figure 1: Comparison of Army Modularity Restructuring and Funding
Schedules:
[See PDF for image]
Note: The Army plan did not include funding data for fiscal year 2004.
[End of figure]
While the Army anticipates that 96 percent of its 194 active and
reserve units will be created by 2008, it will have received only 51
percent of its anticipated funding required to restructure these units
by that time. Army officials told us that while it was necessary to
create these modular units to support ongoing operations, and that
units deploying were being supplied with equipment required to execute
ongoing operations, the Army could not afford to equip the modular
units according to its planned equipping levels for the modular force
at the time the units were created. Therefore, to avoid canceling or
restructuring other programs, funding was flattened out over time to
meet the constraints of the funds available. In written comments on a
draft of this report, DOD acknowledged that some units will face
equipment shortages in the early years of transformation but the Army
will manage these shortfalls through preplanned processes and stringent
management controls.
Also, the funding plan assumes that the Army will achieve a total of
$4.5 billion in business process reengineering efficiencies, and that
the savings associated with these efficiencies will be available to
fund the modular force as part of the Army's regular appropriations. In
December 2004 budget guidance from the Deputy Secretary of Defense, the
Army was instructed to assume that $1.5 billion in business process
reform efficiencies would be available for the modular force in each of
fiscal years 2009, 2010, and 2011. In written comments on a draft of
this report, DOD stated that it had identified programmatic offsets for
these efficiencies and intended to include them as part of its fiscal
year 2007 President's budget request. However, Army officials told us
that details of their plan were not yet finalized and available for
review. As a result, we are unable to comment on the specific plan the
Army has for achieving these efficiencies. However, we noted in our
most recently issued High-Risk Series that for years we have reported
on inefficiencies and the lack of transparency and appropriate
accountability across DOD's major business areas.[Footnote 17] Further,
despite commitment and attention from senior DOD leaders, we found
little tangible evidence of actual improvement in DOD's business
operations to date. Given this track record and the lack of data
available for us to review, we are not confident that the Army can
achieve these efficiencies as planned.
Finally, as we testified in March 2005, the Army's $108 billion FCS
program is at significant risk for not delivering required capability
within budgeted resources.[Footnote 18] Although the bulk of the
funding for this high-priority program is planned for after 2011 when
the Army plans to have completed its modular transformation, $23
billion is projected to be spent from fiscal years 2005 through 2011 on
research and development costs. Given the scope of the program, our
assessment that FCS is likely to encounter problems late in development
when they are very costly to correct, and historical cost growth in
weapons systems, we reported that cost growth associated with FCS could
have dire consequences on the affordability of the Army's programs,
especially in light of a constrained discretionary budget.
In comments to our report DOD stated that the FCS program is on track
and stated that the Army uses a different standard for assessing
technology maturity than GAO. Further, DOD stated that there is
sufficient flexibility in its investment accounts that if financial
risks arise, these risks can be addressed through extended planning
period adjustments in future programming cycles. The fact remains that
the program's level of knowledge--a key indicator of budgetary risk--is
far below that suggested by best practices or DOD policy: nearly 2
years after program launch and with $4.6 billion invested, requirements
were not firm and only 1 of over 50 technologies was mature as of our
March 2005 testimony. Even using the Army's standard for assessing
technology maturity, less than 40 percent of the FCS technologies would
be mature. Further, we note that while extended planning periods may
make the program more affordable in a given year, we have reported that
such extensions are costly.[Footnote 19]
Lack of an Approach to Track Funds Obligated for the Modular Force
Limits the Transparency of Funds Used:
While the Army can generally track funds associated with individual
programs, it has not established an approach for tracking funds
obligated for its modular force transformation. As a result, the Army,
DOD, and Congress will have limited visibility over whether funds are
being expended as intended to achieve transformation goals, and will
not have key data available to determine whether course corrections in
the program are needed. Standards for internal control in the federal
government state that internal controls should provide reasonable
assurance that the objectives of the agency are being
achieved.[Footnote 20] One of the categories of internal controls is
reliability of financial reporting, including reports on budget
execution.
The Army's inability to track obligations related to its modular
transformation is most clearly illustrated by the lack of data from
fiscal year 2004. In that year, the Army created or transformed a total
of 22 units. However, the Army has been unable to determine how much
money it obligated to do so. For example, officials from the Army
Budget Office told us that they track obligations of the overall Army
related to equipment and personnel, but cannot discern how much of the
funds obligated were related to the modular force transformation versus
other programs, such as repairing or replacing equipment from
operations in Iraq and Afghanistan. In early cost projections, the Army
had estimated that it would need $400 million to procure equipment and
$96 million in personnel expenditures to support the modular
transformation in fiscal year 2004. Although Army officials told us
that the majority of equipment requirements were satisfied with
equipment transfers from other units that were not scheduled to deploy
to operations in the near future, they were not able to tell us how
much of the $400 million was offset by these transfers. Similarly, the
Army was not able to distinguish how much of the amount of expenditures
on personnel was attributable to the modular force transformation
versus personnel cost increases associated with activating reservists
for ongoing operations, and stop-loss policies designed to retain
servicemembers for the operations beyond their service obligations. The
Army did report that it obligated $133 million related to operations
and maintenance for the modular force in fiscal year 2004 through a
database it employs to track obligations related to supplemental
appropriations for the Global War on Terrorism. However, in our report
on cost data related to the Global War on Terrorism to be issued later
this month, GAO found numerous problems in DOD's processes for
recording and reporting costs for the Global War on Terrorism, raising
significant concerns about the overall reliability of DOD's reported
cost data.
Army officials acknowledged the need to closely monitor resources
required and applied to the modular force transformation, and noted
that this monitoring occurs as part of weekly, high-level meetings with
the Army Chief of Staff. These meetings focus on tracking equipment
needs of transforming units and making sure that these needs are met.
Equipment shortages can be filled with new equipment, transfers from
other units, or by the unit falling in on equipment left in Iraq. There
are also controls to track how many and what pieces of equipment have
been purchased and distributed, according to these officials. However,
because ongoing missions continually change the status and availability
of equipment, it is difficult for Army officials to define whether new
equipment meets the requirements of modular transformation or ongoing
operational needs. Indeed, sometimes the equipment may serve to meet
both purposes. Also the Army's financial system has limitations and
lacks the functionality required to split out modular components within
each line of equipment. Army leadership, therefore, has made the
decision that it is more important to account for the total equipment
purchased; dollars spent; and operational issues, such as ensuring that
equipment gets to the units that need it, rather than labeling a
particular piece of equipment as dedicated to modular transformation or
not.
While we recognize the challenges of monitoring resource expenditures
in the context of ongoing operations, we also note that in its
estimates and requests for appropriations, the Army has been able to
distinguish between funding requirements for its modular transformation
and other priorities. For example, in documentation supporting the
fiscal year 2005 supplemental appropriation request, the Army stated
that it required $4.6 billion for modularity largely to fund equipment,
vehicles, and facilities, and $3.1 billion to reset and recapitalize
tanks and other battle losses. While the Army appears to have
established parameters for estimating modularity costs, it cannot apply
them for tracking purposes.
Conclusions:
Despite a significant increase in its estimate to fund the modular
transformation from its original estimate, the Army's ultimate costs of
the modular force will likely be higher than currently estimated due to
uncertainties and pending decisions, which may drive costs even higher.
Until the Army develops a detailed plan estimating the total costs of
the modular force as designed and tested and starts submitting this
plan to Congress each year, Congress cannot be assured that it is
receiving an accurate reflection of all costs associated with this
restructuring and the risks associated with any funding shortfalls,
given the uncertainties of the current estimate. Moreover, it will be
difficult for the Secretary of Defense to make informed decisions
weighing the relative merits of programs departmentwide in terms of
making trade-off decisions when faced with likely affordability
challenges in the future.
Further complicating its ability to project resource needs, the Army is
not tracking and reporting obligations related to this effort by fiscal
year. As a result, decision makers, including DOD and Army leadership
and Congress, will not be able to assess whether funds appropriated for
modularity have been utilized for the purposes intended nor will they
have historical information useful in considering future funding needs.
Recommendations for Executive Action:
To improve information available to decision makers on the cost of the
Army's plan for modularity, we are making to recommendations to the
Secretary of Defense.
We recommend that the Secretary of Defense direct the Secretary of the
Army to provide Congress a detailed plan estimating the costs of
modularity sufficient to provide Congress reasonable assurance that
estimated costs reflect total costs of modularity as designed and
tested. Such a plan should be prepared annually and submitted as part
of justification material supporting DOD's budget request, until the
modular force is fully implemented. It should include:
* a clear definition of what costs the Army does and does not consider
to be related to the modular transformation;
* estimates for equipment, facilities and personnel;
* identification of uncertainties in the plan due to pending force
structure design decisions or other decisions that may affect costs,
and updates to the plan as these decisions are made;
* a report on obligations related to the modular force made the
previous fiscal year; and:
* divergences from the plan as stated in the prior year's report, and
contributing factors.
To facilitate his oversight of the program and collecting the data for
Congress mentioned above, we also recommend that the Secretary of
Defense direct the Secretary of the Army in coordination with the
Undersecretary of Defense (Comptroller) to develop a plan for
overseeing the costs related to the Army's transformation to a modular
force. This plan should include an approach for tracking modular
transformation costs that clearly identifies obligations for the
modular force.
Matter for Congressional Consideration:
The Congress should consider requiring the Secretary of Defense to
provide a plan for overseeing spending of funds provided for
modularity.
Agency Comments and Our Evaluation:
In written comments on a draft of this report provided by the Army on
behalf of DOD, the department strongly disagreed with our findings
related to the cost estimate for the modular force and the
uncertainties cited. DOD stated that the Army's $48 billion cost
estimate is solid and does not include uncertainties. For example,
although DOD expects the modular force design to change, it does not
believe these changes will substantially change the Army's cost
estimate. Also, DOD objected to our inclusion of personnel costs in our
estimate because it believes the end strength increase is temporary and
entirely related to the Global War on Terrorism. DOD noted that an end
strength increase would not have been necessary in a peacetime
environment. DOD also stated that our report includes costs related to
resetting the force, BRAC, overseas restationing of service members,
and FCS. The department noted that these costs were not included in its
estimate for the modular force, nor should they be. Despite these
concerns, DOD partially concurred with our recommendations.
We do not agree that DOD is in a position to state that the Army's cost
estimate is solid and continue to believe that our findings fairly
reflect the potential costs and uncertainties associated with the
Army's modular transformation. As we state in our report, at the time
the estimates were set, the Army had not finished the designs for
support units and command and control echelons. In addition, we note
that the Army has not included the equipment quantities in the tested
design as the basis for determining equipment costs. If subsequent
testing or lessons learned demonstrate any weaknesses in the current
design, the Army may decide to modify equipment levels or force
structure, which could impaaffect costs. We recognize that some of
these uncertainties, such as those related to facilities costs and
force design, are a reflection of preparing an estimate for a very
complicated undertaking where there are many moving parts. Given the
complexity of this undertaking and two decades of GAO reports
delineating DOD's overly optimistic planning assumptions in budget
formulation, which often lead to program instability or costly program
stretch outs, we believe these uncertainties should be explicitly
acknowledged so that decision makers can make informed decisions.
Regarding the inclusion of personnel costs related to the end strength
increase, we note that the Army's own documents justified the end
strength increase for the dual purposes of transforming and conducting
operations. For example, the Army's 2005 Modernization Plan states that
a 30,000 temporary increase in the Army's end strength enabled the
beginning of the modular conversion of active component combat units.
Moreover, the Army's initial 2004 estimate included personnel costs due
to increases in end strength. Finally, it is not clear how the Army
would be able to add 10 combat brigades to the active component without
affecting end strength in some manner. For these reasons we continue to
believe that the Army needs to recognize these costs in its estimate.
DOD also suggests that costs associated with resetting the force, BRAC,
overseas restationing of forces, and FCS are included in our estimate
of $75.5 billion. While we cite these issues as either pending
decisions or related programs that could affect the scope or
affordability of the modular transformation, we do not include the
costs of these programs in the estimate itself.
DOD partially concurred with our recommendation that the Secretary of
Defense direct the Secretary of the Army to provide improved cost
estimates to reflect the total cost of the modular transformation as
designed and tested, and recognized the need for periodic reporting on
the modular force. DOD also cited forthcoming reports that it believed
would provide official, comprehensive oversight of the modular force
initiative. Specifically, DOD cited a report due to Congress in
September 2005 on the long-range plan for executing and funding the
modular force initiative that includes related budget projections for
fiscal years 2007 through 2011, funding challenges, equipment
requirements, and program management oversight practices. In addition,
according to the comments, the Army was directed to provide the Office
of Management and Budget, through the Office of the Secretary of
Defense, an annual report for the Army modular force. We agree with DOD
that additional reporting on this initiative is needed, and note that
the reporting requirements from both Congress and the Office of
Management and Budget also indicate a need for improved information.
Our recommendation does not seek to create redundant and unnecessary
additional reporting requirements, as was indicated in DOD's comments.
Indeed, our recommendation allows DOD wide latitude in how it provides
the information we believe Congress needs for oversight to avoid such
redundancy. However, we also note that the reports DOD cited have not
yet been finalized, and we are unable to determine from DOD's
description whether these reports would address our recommendations. If
these reports adequately address the reporting requirements we
recommend, there would be no need for additional reporting on DOD's
part.
DOD also partially concurred with our recommendation that the Secretary
of Defense direct the development of a plan for overseeing the costs
related to the Army's transformation to a modular force. DOD noted that
the Undersecretary of Defense (Comptroller) will closely monitor the
funding and execution of projects and programs associated with
transformational efforts as part of its oversight responsibilities.
However, DOD also noted that there were no plans to establish an
encompassing framework, grouping Army projects together under
"modularity." It stated that such a framework would dramatically expand
the billing process, increase administrative costs, and more
importantly complicate distribution of material in a wartime
environment. We continue to believe that the Army will need a framework
or approach to oversee expenditures for modularity in order to provide
DOD and the Congress the information needed for effective oversight. We
note that the recommendation provides DOD wide latitude to establish an
approach for tracking modular transformation costs, and we do not
advocate a framework that would require a separate billing system or
complicate distribution of material in a wartime environment (or any
environment). As we noted in the report, in preparing its budget
estimate and request for funding, the Army has already grouped projects
together under the modularity umbrella and has identified specific
funding needs for modularity. DOD is asking Congress to allocate $48
billion to this modular transformation (over $75 billion when personnel
and some other costs are included). As with any initiative of this
magnitude, the Secretary of Defense and Congress require the best data
available to weigh competing resource requirements so that they can
make appropriate trade-off decisions. Information on how the Army has
spent funds provided for modularity should be considered in formulating
future funding requests. Therefore, our recommendation is intended to
provide assurance that future such requests consider the obligations
made thus far so that Congress has a sound basis on which to determine
whether funds allocated to the modular force are being obligated as
intended. Because DOD stated it has no plans to establish a framework
to track these obligations, and given the magnitude and significance of
the effort as well as the fact that DOD has requested funds from
Congress specifically for modularity, we continue to believe oversight
of expenditures is needed. Therefore, we have included a matter for
congressional consideration. Specifically, the Congress should consider
requiring the Secretary of Defense to provide a plan for overseeing
spending of funds provided for modularity.
DOD's comments are reprinted in appendix II and addressed as
appropriate in the body of the report. Annotated evaluations of DOD's
comments are also included in appendix II.
We are sending copies of this report to the Secretary of Defense, the
Undersecretary of Defense (Comptroller), and the Secretary of the Army.
We will also make copies available to others upon request. In addition,
this report will be available at no charge on the GAO Web site at
http://www.gao.gov.
If you or your staff have any questions about this report, please
contact me at (202) 512-9619 or pickups@gao.gov. Contact points for our
Offices of Congressional Relations and Public Affairs may be found on
the last page of this report. GAO staff who made major contributions to
this report are listed in appendix III.
Signed by:
Sharon L. Pickup:
Director, Defense Capabilities and Management:
List of Committees:
The Honorable John Warner:
Chairman:
The Honorable Carl Levin:
Ranking Minority Member:
Committee on Armed Services:
United States Senate:
The Honorable Ted Stevens:
Chairman:
The Honorable Daniel Inouye:
Ranking Minority Member:
Subcommittee on Defense:
Committee on Appropriations:
United States Senate:
The Honorable Judd Gregg:
Chairman:
The Honorable Kent Conrad:
Ranking Minority Member:
Committee on the Budget:
United States Senate:
The Honorable Duncan Hunter:
Chairman:
The Honorable Ike Skelton:
Ranking Minority Member:
Committee on Armed Services:
House of Representatives:
The Honorable Bill Young:
Chairman:
The Honorable John Murtha:
Ranking Minority Member:
Subcommittee on Defense:
Committee on Appropriations:
House of Representatives:
The Honorable Jim Nussle:
Chairman:
The Honorable John Spratt:
Ranking Minority Member:
Committee on the Budget:
House of Representatives:
[End of section]
Appendix I: Objectives, Scope and Methodology:
Overall, our analysis of the Army's cost estimate, funding plan, and
approach for tracking obligations pertaining to its modular
transformation was limited to an examination of data presented in broad
spending categories, such as equipment, facilities, and personnel costs
by year. We interviewed and examined documents from knowledgeable Army
officials about assumptions underlying each of these funding
categories. Further, at headquarters and command levels, we examined
the processes in place to monitor obligations related to the modular
force. We found this information sufficiently reliable to analyze the
assumptions underlying costs of the modular force and funding plans.
Because of the uncertainties in the cost estimates and weaknesses in
its approach to monitor obligations related to the modular force, we
made recommendations to address each of these areas in order to improve
data available for decision makers. Our specific methodology for each
reporting objective follows.
To determine the extent to which Army reflected expected costs and
identify areas of uncertainty in the estimate, we obtained overall cost
estimates from the offices of the Deputy Chief of Staff G-8[Footnote
21] and the Deputy Assistant Secretary of the Army for Budget. We also
examined justification materials supporting the fiscal year 2006 budget
request, as well as the fiscal year 2005 request for supplemental
appropriations, and monitored the development of the strategy, scope,
schedule, and status of Army restructuring by examining key planning
documents, such as the Army Campaign Plan, the 2004 Army Transformation
Roadmap, and the Army Modernization Plan. To examine areas of cost
uncertainty likely to be produced by transforming to a modular force,
we discussed assumptions underlying these estimates and obtained
corroborating documentation in interviews with officials from the
Department of the Army Deputy Chiefs of Staff for Personnel (G1),
Intelligence (G2), and Operations and Training (G3), and the Assistant
Chief of Staff for Installation Management. We further discussed
assumptions and areas of uncertainty with these offices' organizational
counterparts at Forces Command in Fort McPherson, Georgia; the 3rd
Infantry Division, in Fort Stewart, Georgia; the 101st Airborne
Division in Fort Campbell, Kentucky; and the 4th Infantry Division, in
Fort Hood, Texas. We also reviewed reports by non-Department of Defense
entities such as the Congressional Budget Office, and our own reviews
related to Army personnel. We compared these sources against the Army's
cost assumptions to determine if they comprehensively accounted for
expenses stemming from the strategy, scope, and schedule for
transforming to a modular force.
To determine the Army's plan for funding these costs and factors that
may affect its ability to fund the modular force, we considered the
cost estimates in the context of the larger Army budget, particularly
the Army's reliance on supplemental appropriations and how funding the
modular force fit into other programs and initiatives. Specifically, we
examined justification materials for the 2006 presidential budget, the
2005 supplemental appropriation request, and budget guidance from the
Office of the Deputy Secretary of Defense. To identify factors that
could affect the Army's ability to fund modularity, we questioned
Deputy Chief of Staff G-8 officials about the Army's plan to garner
efficiencies to apply to costs of the modular force to determine the
status of these plans. We also relied on ongoing and previous GAO
reviews of business process reengineering to evaluate Army efficiency
claims. In addition, we considered the impact other priorities might
have on the implementation of the Army's modularity plan, including
current operations, the Future Combat Systems, Base Realignment and
Closure decisions, and decisions to restation soldiers from overseas.
Applying federal internal control standards, we determined whether the
Army has an adequate approach in place to track obligations related to
the modular force. In that regard, we interviewed officials from the
Office of the Deputy Assistant Secretary of the Army for Budget and the
Resource Management Office at Forces Command, and resource management
officials at the 3rd Infantry Division, the 101st Airborne Division,
and the 4th Infantry Division to determine how these entities tracked
funds earmarked for the modular force. We reviewed documents
establishing guidance from Army headquarters and discussed and
documented how this guidance was implemented at lower command levels.
In addition, we relied on the results of GAO's analyses of funds used
to support the Global War on Terrorism, to the extent that these funds
were used to support the modular force.
Our review was conducted from May 2004 through June 2005 in accordance
with generally accepted government auditing standards.
[End of section]
Appendix II: Comments from the Department of Defense:
DEPARTMENT OF THE ARMY:
OFFICE OF THE DEPUTY CHIEF OF STAFF, G-8: 700 ARMY PENTAGON:
WASHINGTON, DC 20310-0700:
September 7, 2005:
Ms. Sharon Pickup:
Director, Defense Capabilities and Management:
U.S. Government Accountability Office:
441 G Street, N.W.:
Washington, DC 20548:
Dear Ms. Pickup:
Enclosed is the Department of Defense response to the GAO draft report,
"FORCE STRUCTURE: Actions Needed to Improve Estimating and Tracking of
Costs for Transforming Army to a Modular Force," dated August 4, 2005,
(GAO Code 350547/GAO-05-926).
The Department strongly disagrees with the GAO view of the Army Modular
Force estimate and the cited uncertainties surrounding this estimate as
described in the report. The Army's $48 billion cost estimate for the
Army Modular Force is solid. The Army has portrayed the cost of the
Army Modular Force both consistently and accurately. The GAO report
includes costs related to personnel increases required to support
current combat operations in the Global War on Terror, resetting the
force, Base Realignment and Closure, overseas restationing, and Future
Combat Systems (FCS). These costs are not included in the Army Modular
Force estimate nor should they since they are addressed separately.
The Department recognizes the need for periodic reporting on the Army
Modular Force and partially concurs with the recommendations.
Sincerely,
Signed by:
N. Ross Thompson III:
Major General, U.S. Army:
Director, Program Analysis and Evaluation:
Enclosure:
GAO DRAFT REPORT - DATED AUGUST 4, 2005 GAO CODE 350547/GAO-05-926:
"FORCE STRUCTURE: Actions Needed to Improve Estimating and Tracking of
Costs for Transforming Army to a Modular Force"
DEPARTMENT OF DEFENSE COMMENTS AND COMMENTS TO THE RECOMMENDATIONS:
COMMENTS:
The GAO report has attached or asserted unrelated costs to the Army
Modular Force estimate. GAO also contends that the funding profile and
force design changes create additional fiscal uncertainties. The Army
strongly disagrees with the GAO view of the Army Modular Force estimate
and the cited uncertainties surrounding this estimate as described in
the report. The Army's $48 billion cost estimate for the Army Modular
Force is solid. The Army has portrayed the cost of the Army Modular
Force both consistently and accurately. The GAO report includes costs
related to personnel increases required to support current combat
operations in the Global War on Terror, resetting the force, Base
Realignment and Closure, overseas restationing, and Future Combat
Systems (FCS). These costs are not included in the Army Modular Force
estimate nor should they since they are addressed separately.
The Army disagrees with GAO's position that there are still
uncertainties surrounding the current estimate. The Army's estimate of
$48 billion dollars coupled with $4.5 billion gained internally through
business process efficiencies allows for procurement of equipment and
essential facilities required to equip and house the Army Modular Force
as planned by the end of fiscal year 2011. Though there have been and
there will continue to be Army Modular Force design changes subsequent
to the current estimate, these are normal in the Army's force
development process and will not substantially change the Army's
estimate as GAO asserts.
The Army has been forthright about the challenges of transforming while
engaged in combat operations and understands that funding does not
specifically match the current modular conversion schedule. Some units
will face equipment shortages in the early years of transformation but
the Army will manage these shortfalls through preplanned processes and
stringent management controls. The systematic management of these
shortages is directed from the highest leadership levels to ensure the
right soldier and the right piece of equipment is in the right place at
the right time. These shortages will be filled, as transformation
progresses, by the end of fiscal year 2011. As an example of management
emphasis, the Army has equipped and manned all deploying and deployed
Brigade Combat Teams to the required level while transforming on
schedule and within current estimates.
The GAO report incorrectly links personnel endstrength cost increases
directly to the Amy Modular Force cost estimate. The Army Chief of
Staff requested a temporary endstrength increase to provide "head room"
to enable the Army to transform while simultaneously fighting the
Global War on Terror (GWOT). Based on a Presidential decision in
January 2004, the active component is adding up to 30,000 Soldiers,
increasing endstrength from 482,400 to 512,400. This endstrength
increase is required to sustain ongoing combat operations and would not
have been necessary in a peacetime environment. The Army considers all
personnel costs related to the temporary endstrength increase to be
GWOT related. Both the Secretary of the Army and the Army Chief of
Staff have publicly acknowledged that endstrength increases due to
current operations are temporary and all endstrength increases above
482,400 are GWOT related. Assertions made otherwise are inaccurate. As
a result, endstrength costs are not part of the Army Modular Force
estimate.
The GAO report asserts the Army will not be able to achieve $4.5
billion in business process re-engineering efficiencies in fiscal years
2009, 2010 and 2011. The Army is confident that it will achieve these
efficiencies. In fact, the Army has already identified programmatic
offsets for these efficiencies and will include the $4.5 billion as
part of the fiscal year 2007 President's Budget Request. The Army is
training leaders in proven techniques such as Lean Six Sigma in order
to implement disciplined and measurable approaches to reduce waste and
streamline organizations. By the end of FY07, the Army will have the
internal infrastructure established to train our entire workforce to
develop a learning culture of innovation that focuses on continuous
measurable improvement and increased productivity.
The GAO report asserts that FCS has "significant risk for not
delivering required capabilities." FCS is a system of systems
consisting of individual elements with technology maturing at different
times. In addition, the Army considers a technology ready for
transition to an acquisition program when it reaches Technology
Readiness Level (TRL) 6 (demonstrated in a relevant environment), and
provides technology base funding consistent with this philosophy. GAO,
on the other hand, considers a technology ready for transition at TRL 7
(demonstrated in an operational environment). The FCS program is on
track and the Army believes there is sufficient flexibility in our
investment accounts and any financial risk can and will be addressed
through extended planning period adjustments in future programming
cycles.
The decision to add an additional five Brigade Combat Teams will be
determined by the Secretary of Defense in 2006. It would be
inappropriate to prematurely add the potential increases of five
additional Brigade Combat Teams to the current cost estimate. If the
decision is made to add an additional five brigades, the Army Modular
Force estimate will be updated at that time.
The GAO concerns regarding tracking Army Modular Force costs are based
on a single system program approach. The Army Modular Force conversion
is not an individual program but is instead a reorganization affecting
almost 70 percent of the Army's total structure in the Active and
Reserve Components as well as hundreds of individual procurement
programs throughout the force.
Funds for Army Modular Force transformation are requested and
appropriated separately by Congress for each piece of equipment. Each
acquisition item has a designated program manager with specialized
acquisition experience and training. The Army uses a standard defense
wide (DoD) financial system to manage and control the execution of
these funds at the Budget Line (BLIN) item level in the manner
appropriated. This standardized accounting system lacks the
functionality required to split out modular components within each line
of equipment nor is such a system desirable.
An accounting mechanism that specifically earmarks individual items of
equipment as modular will, by necessity, have the undesirable effect of
dramatically expanding the billing process and increasing
administrative costs. More importantly, this change would complicate
equipment distribution in a wartime environment. The Army requires a
responsive, flexible system that facilitates the rapid maneuvering of
equipment and materiel to transforming units preparing to deploy to
combat. The current DoD financial system provides the best possible
internal control for the acquisition of modular components and gives
the Army the requisite flexibility necessary to meet operational
requirements and contingencies.
In our view, the GAO report should include a balance of positive
commentary regarding the Army's strategic transformation specifically
acknowledging significant accomplishments to date.
Army Transformation supports and complies with Department of Defense
(DOD) operational goals as identified in the Defense Planning Guidance
(DPG). In response to the DPG, the Army is transforming now while
engaged in combat operations around the world. While engaged and
transforming, the Army has equipped and manned all deploying Brigade
Combat Teams on schedule and within current cost estimates. Although
this has posed some challenges, the Army has and will continue to
manage the force to meet the needs of the Nation and its Soldiers and
families both at home and abroad.
In the short time since concept approval, the Army has completed 29 of
the 50 major decisions critical to achieve the Army Modular Force and
the Modular Force Objectives defined by the Chief of Staff of the Army.
The following actions critical to organizational transformation have
been completed within estimated costs and on schedule:
* Created the modular designs and scheduled the conversion of almost
every Army Modular Force unit, with completion by FY12:
* Built five new BCTs and modularly converted 16 BCTs:
- 4 modular BCTs currently deployed to Operation Iraqi Freedom:
- 8 modular BCTs preparing to deploy Created 16 modular Support
Brigades Realigned resources to fund crucial transformation efforts:
* Made rebalancing decisions affecting over 100,000 Active and Reserve
Component personnel positions, with over 34,000 already executed;
* Designed and began the implementation of a unit operational cycle
process that maximizes readiness and availability of forces while
restructuring Institutional Army capabilities to provide better support
to the Army Modular Force.
These actions are occurring as the Army annually is rotating over
160,000 troops into combat theaters to fight the Global War on Terror.
The primary and most appropriate metric to monitor both the short and
long-term performance of the Army Modular Force is building and
converting current brigades to modular Brigade Combat Teams in
accordance with the Army Campaign Plan schedule.
COMMENTS TO THE RECOMMENDATIONS:
RECOMMENDATION 1: The GAO recommended that the Secretary of Defense
direct the Secretary of the Army to provide Congress a detailed plan
estimating the costs of modularity sufficient to provide Congress
reasonable assurance that estimated costs reflect total costs of
modularity as designed and tested. Such a plan should be prepared
annually and submitted as part of justification material supporting
DOD's budget request, until the modular force is fully implemented. It
should include:
* A clear definition of what costs the Army does and does not consider
to be related to the modular transformation;
* Estimates for equipment, facilities and personnel;
* Identification of uncertainties in the plan due to pending force
structure design decisions or other decisions that may affect costs,
and updates to the plan as these decisions are made;
* A report on obligations related to the modular force made the
previous fiscal year; and:
* Divergences from the plan as stated in the prior year's report, and
contributing factors. (pages 20-21/GAO Draft Report):
DoD RESPONSE: Partially Concur. DoD recognizes the need for periodic
reporting on the Army Modular Force. The Army will provide a report to
Congress on the Army Modular Force initiative as of 1 September 2005.
The report provides the long-range plan for executing and funding the
Army Modular Force initiative, as well as the budget for the Army
Modular Force in fiscal years 2007-2011. The report also encompasses
funding challenges, equipment requirements and program management
oversight practices. This report can be prepared annually and submitted
as part of the justification material.
In addition, the Army was directed this fiscal year by the Office of
Management and Budget (OMB) through the Office of the Secretary of
Defense (OSD) to begin annual reporting for the Army Modular Force. The
process used for this reporting is through the OMB Program Assessment
Rating Tool (PART).
The PART comprehensively reviews federal programs looking at program
purpose, design, strategic plans, management, and execution metrics.
The PART is a systematic method of assessing the performance of program
activities across the Federal government. It is a diagnostic tool used
to improve program performance. The PART assessments help inform budget
decisions and identify actions to improve results. Agencies are held
accountable for implementing PART follow-up actions and working toward
continual improvements in performance.
Since the Army Modular Force Initiative report and the OMB PART provide
official, comprehensive oversight, we recommend that these reporting
mechanisms be used as the authoritative source. The GAO proposal as
structured creates redundant, and unnecessary additional reporting that
will be addressed by both the Army Modular Force Initiative Report to
Congress and the Army Modular Force PART.
RECOMMENDATION 2: The GAO recommended that the Secretary of Defense
direct the Secretary of the Army in coordination with the
Undersecretary of Defense (Comptroller) to develop a plan for
overseeing the costs related to the Army's transformation to a modular
force. This plan should include an approach for tracking modular
transformation costs that clearly identifies obligations for the
modular force. (p. 21/GAO Draft Report):
DOD RESPONSE: Partially Concur. The transformation of the Army is not a
specific budget line item in the Army budget. Instead, funds provided
to convert the Army to a modular force are spread throughout various
appropriations and programs, which in total contribute to the
transformation effort. The Undersecretary of Defense (Comptroller), as
part of its oversight responsibilities, will closely monitor the
funding and execution of projects and programs associated with
transformational efforts. However, there are no plans to establish an
encompassing framework, grouping Army projects together under
"Modularity that would dramatically expand the billing process,
increase administrative costs and more importantly complicate
distribution in a wartime environment when the Army requires a
responsive, flexible system that facilitates the rapid maneuvering of
equipment and materiel to transforming units preparing to deploy to
combat. Instead, to address cost oversight, funding and execution will
be separately tracked at the component and project level.
The following are GAO's comments on the Department of the Defense's
letter dated September 7, 2005.
GAO's Comments:
1. We did not state that the Army would be unable to achieve
efficiencies. Rather we noted the Army's ability to realize savings is
uncertain because DOD has historically had difficulty achieving
expected efficiencies.
2. We did not state that the costs of an additional five brigade combat
teams should be included in the estimate. Rather, as with other
uncertainties cited in this section, we noted that pending future
decisions, including whether to add five brigade combat teams, could
impact the cost of the modular transformation.
3. We revised the text to reflect DOD's comments that Army
transformation supports DOD's goals and that the Army has taken steps
to design, schedule, build, and convert brigade combat teams and
support brigades. We did not include the comments that these actions
were completed within estimated costs because, as our report states,
uncertainties remain about the Army's cost estimates and the Army does
not have a system for tracking modularity costs.
[End of section]
Appendix III: GAO Contact and Staff Acknowledgments:
GAO Contact:
Sharon L. Pickup (202) 512-9619:
Acknowledgments:
In addition to the contact named above, Gwendolyn Jaffe, Assistant
Director; Margaret Best; J. Andrew Walker; and Joah Iannotta made major
contributions to this report.
FOOTNOTES
[1] FCS is a program that consists of a family of systems composed of
advanced network combat and sustainment systems, unmanned ground and
air vehicles, and unattended sensors and munitions.
[2] GAO, Force Structure: Preliminary Observations on Army Plans to
Implement and Fund Modular Forces, GAO-05-443T (Washington, D.C.: Mar.
16, 2005).
[3] Unless otherwise noted, costs presented in this report are in then-
year dollars.
[4] In constant fiscal year 2006 dollars, this totals $71.6 billion.
[5] GAO, Standards for Internal Control in the Federal Government, ,
GAO/AIMD-00-21.3.1 (Washington, D.C.: November 1999).
[6] The Army's plan calls for three variants of the modularized brigade
combat team. The infantry variant will have about 3,300 personnel, the
armored variant 3,700 personnel, and the Stryker variant 4,000
personnel.
[7] Ronald W. Reagan National Defense Authorization Act for Fiscal Year
2005, Pub. L. No. 108-375 § 401 (2004).
[8] Ibid, § 403.
[9] In constant fiscal year 2006 dollars, this totals $71.6 billion.
[10] The initial estimate for the active component transformation,
which accounted for $20.1 billion of the initial $28 billion, was
presented to the President and Secretary of Defense in a January 2004
briefing on the modular force transformation. In later briefings the
Army added $7.9 billion to cover the costs of transforming the reserve
component.
[11] Army officials told us they excluded fiscal year 2004 costs from
the estimate because the Army wanted to present future requirements, as
opposed to past expenditures, and that the inclusion of the fiscal year
2004 modular force costs would add a relatively minor increase to the
overall costs.
[12] GAO, Military Prepositioning: Better Management and Oversight
Needed to Reduce Risk and Improve Future Programs, GAO-05-427
(Washington, D.C.: July 2005).
[13] H.R. 1815, 109th Cong. §§ 401, 1521, and 1522 (2005).
[14] S. 1402, 109th Cong. § 401 (2005).
[15] Congressional Budget Office, Options for Restructuring the Army
(Washington, D.C.: May 2005), www.cbo.gov (downloaded May 11, 2005).
[16] This amount includes $5 billion per year from 2007 through 2011
that the Secretary of Defense specifically allocated to the Army for
modularity in guidance for preparing the fiscal year 2006 budget
request.
[17] GAO, High-Risk Series: An Update, GAO-05-207 (Washington, D.C.:
January 2005).
[18] GAO, Defense Acquisitions: Future Combat Systems Challenges and
Prospects for Success, GAO-05-428T (Washington, D.C.: Mar. 16, 2005).
[19] GAO, Major Management Challenges and Program Risks: Department of
Defense, GAO-03-98 (Washington, D.C.: January 2003).
[20] GAO, Standards for Internal Control in the Federal Government,
GAO/AIMD-00-21.3.1.
[21] This office is responsible for programming, materiel integration,
and management of Department of the Army studies and analyses.
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