Improvements Can Be Made in Military Assistance Equipment Disposals

GAO recently completed a survey of the controls and procedures exercised over the management and disposal, including related proceeds, of Military Assistance Program (MAP) materiel.

The survey disclosed that: (1) there are no comprehensive records of the extent and value of MAP materiel in recipient countries that the United States still has exercisable residual rights to; (2) the cost of disposing of MAP materiel declared excess by recipient countries is increasing and sometimes exceeds the sales proceeds; and (3) there is only limited information available on the proceeds being realized from MAP disposals and sales and on where the funds are being deposited or used. GAO has strongly urged the reversionary rights sales of old and obsolete MAP materiel to countries no longer receiving MAP assistance. GAO believes that such sales reduce U.S. and recipient countries' administrative expenses, provide funds to the United States, and have the potential for establishing stronger relations with the recipient countries. The actual funds that would result from reversionary rights sales are difficult to predict, but they could be significant. It is the GAO opinion that reversionary rights sales have not taken place or negotiations sufficiently advanced because there has not been effective cooperation and active support among all Department of Defense (DOD) activities and the State Department. GAO suggests that DOD, in conjunction with State, encourage reversionary rights sales of old and obsolete MAP materiel and, when this is not feasible, agreements should be entered into for disposal to be conducted by the host countries. DOD may also wish to discuss with Congress the application of MAP disposal proceeds that will best serve the needs of DOD.