United States General Accounting Office

GAO Report to Congressional Committees

July 1998 DEFENSE DEPOT

MAINTENANCE

Public and Private

Sector Workload

Distribution Reporting

Can Be Further

Improved

GAO/NSIAD-98-175

GAO United States

General Accounting Office

Washington, D.C. 20548

National Security and

International Affairs Division

B-279949 

July 23, 1998

The Honorable Strom Thurmond

Chairman

The Honorable Carl Levin

Ranking Minority Member

Committee on Armed Services

United States Senate

The Honorable Floyd Spence

Chairman

The Honorable Ike Skelton

Ranking Minority Member

Committee on National Security

House of Representatives

On February 5, 1998, the Department of Defense (DOD) submitted a report

to Congress on the distribution of depot maintenance workloads for fiscal

year 1997. As required by the National Defense Authorization Act for

Fiscal Year 1998, we reviewed DOD’s report on the percentage of depot

maintenance funding provided to the public and private sector activities.

Specifically, this report (1) provides our assessment of the completeness

and consistency of workload distribution data reported by the military

departments and defense agencies for fiscal year 1997 and (2) analyzes the

procedures DOD used to define and quantify funding for depot maintenance

workloads. In addition, as requested by the Readiness Subcommittee of

the Senate Armed Services Committee and the Military Readiness

Subcommittee of the House Committee on National Security, the report

provides preliminary information on public and private sector workload

distributions projected for fiscal years 1998 through 2003 and changes

being considered by the Office of the Secretary of Defense (OSD) and the

military departments that could impact future reporting.

Background Depot-level maintenance and repair involves the overhaul, upgrade, and

rebuilding of military systems, subsystems, parts, and assemblies. This

requires extensive shop facilities, specialized equipment, and highly skilled

technical and engineering personnel. Traditionally, public sector

maintenance and repair activities are conducted at 22 major

government-owned and government-operated depots1

 and a number of

1

Major depots employ at least 400 personnel. Two major Air Force logistics centers (San Antonio and

Sacramento) are in the process of closing and a naval warfare center (Keyport) is being downsized to

less than 400 employees.

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B-279949 

other government-owned facilities, including post-production software

support activities, naval warfare centers, and Army arsenals. According to

DOD officials, private sector maintenance and repair is conducted at about

1,100 contractor-operated facilities at various geographic locations.

Since the early 1990s, the distinction between depot-level maintenance

and other levels of maintenance and manufacturing work has become

increasingly vague. Depot-level maintenance activities are performed in

traditional situations, but are also performed by civilian and active-duty

military personnel in military units and by contractors at various field

locations. Funds for depot-level maintenance activities come from several

sources—DOD’s working capital fund; its operations and maintenance

appropriation; its research, development, testing, and evaluation

appropriation; and its procurement appropriation.

Legislative Requirements

on Public and Private

Sector Workload

Distribution

The allocation of depot maintenance workload between the public and

private sectors is governed by 10 U.S.C. 2466. The statute applicable

during fiscal year 1997, which was often referred to as the 60/40 rule,

provided that not more than 40 percent of funds2

 made available to a

military department or defense agency for depot-level repair and

maintenance was to be used to contract for performance by nonfederal

personnel. These percentages apply to each individual military department

and defense agency. The fiscal year 1998 Defense Authorization Act, which

was approved on November 18, 1997, amended 10 U.S.C. 2466, increasing

the percentage of work that can be contracted to nonfederal government

personnel to not more than 50 percent. The act also amended

10 U.S.C. 2466 to require that no later than February 1 of each year, the

Secretary of Defense is to submit a report to Congress concerning

performance during the preceding fiscal year of depot-level maintenance

and repair workloads for the public and private sectors. Further, not later

than 90 days after the Secretary has submitted the annual report to

Congress, we are to report on whether the DOD complied with the public

and private sector workload distribution requirements for the preceding

fiscal year.

How depot maintenance workloads are defined and what factors of

production are included are key factors influencing the collection and

analysis of depot-level maintenance funding provided to the public and

private sectors. Although Congress has required DOD to report public and

2

As requested by OSD’s implementing guidance, the data reported by the military departments and

defense agencies represents obligations for fiscal year 1997 and projected obligations for fiscal

years 1998-2003. Hereafter in this report, we refer to this information as funding data.

Page 2 GAO/NSIAD-98-175 Defense Depot Maintenance
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private sector workload distribution data in all but one year since 1991,

definitions describing the workloads for reporting purposes were not

separately identified in statute. Moreover, working definitions were

provided in a variety of DOD directives, regulations and publications. The

services applied these definitions using ad hoc procedures to prepare the

prior-year reports.

The 1998 Defense Authorization Act added a new provision,

10 U.S.C. 2460, which defines depot-level maintenance and repair

workloads. The provision specifies that depot-level repair and

maintenance includes (1) the overhaul, upgrading or rebuilding of parts,

assemblies, or subassemblies; (2) testing and reclamation of equipment;

(3) all aspects of software maintenance classified by DOD as depot

maintenance as of July 1, 1995; and (4) interim contractor support (ICS)

and contractor logistics support (CLS) to the extent it involves depot-level

maintenance services.3

 The provision also specifies that all depot-level

repair and maintenance workloads are to be included, regardless of

funding source. The provision excludes from depot-level maintenance

workload (1) the procurement of major modification or upgrades of

weapon systems that are designed to improve program performance,

(2) the procurement of parts for safety modifications, and (3) the nuclear

refueling of aircraft carriers.

Prior Reports Concerning

Public and Private Sector

Workload Distribution

Reporting

In May 1996, we reported that DOD’s report of public and private sector

depot maintenance workload allocations did not provide a complete,

consistent, and accurate picture of depot maintenance workloads because

it did not include funding for (1) interim contractor support and contractor

logistics support, (2) labor for installation of modification and upgrade

kits, and (3) software maintenance support costs.4

 In that report, we

suggested that Congress may wish to consider requiring that these

workload categories be included in future 60/40 reports, regardless of

funding source.

Similarly, in January 1998, we reported that DOD’s approach for collecting

information on public and private sector depot maintenance workload

allocations did not provide complete and consistent reporting for the same

3

CLS is contractor-provided, long-term, total life-cycle logistics support that combines depot-level

maintenance along with wholesale and selected retail material management functions. ICS is

contractor-provided logistics support, including depot-level maintenance work obtained as part of the

initial acquisition strategy for new systems.

4

Defense Depot Maintenance: More Comprehensive and Consistent Workload Data Needed for

Decisionmakers (GAO/NSIAD 96-166, May 21, 1996).

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workload categories that we reported in May 1996. We noted that DOD’s

guidance to the military departments was imprecise, leaving room for

varying interpretations on data to be reported. To improve upon the

accuracy of future 60/40 reports, we recommended that DOD develop a

standardized methodology for annually collecting depot maintenance

funding data for the public and private sectors, including specific

definitions of the types of workloads and defense activities that should be

reported.5

 As discussed later, OSD acted upon information contained in a

September 1997 draft of our January 1998 report. In December 1997, OSD

issued guidance that addressed many of the concerns we raised regarding

how the workload distribution data should be collected and aggregated to

provide more complete and consistent reporting.

Results in Brief In February 1998, DOD reported that the military departments and defense

agencies allocated a total of $10.3 billion in depot maintenance funds for

fiscal year 1997—$6.5 billion, or 63 percent, to public sector facilities and

$3.8 billion, or 37 percent, to private sector contractors. Our work shows

that the military departments did not develop complete and consistent

workload distribution information. For example, for fiscal year 1997, we

identified depot-level maintenance workloads valued at about

$1.9 billion—about $300 million for public sector workloads and

$1.6 billion for private sector workloads—that were not included in DOD’s

report. While recognizing the lack of clarity in the reporting requirements,

if included the public sector share of depot maintenance funding would

have been $6.8 billion, or about 56 percent, and the private sector share

about $5.4 billion, or about 44 percent.

This condition exists for three reasons. First, OSD guidance—while

substantially improved over prior years—leaves room for varying

interpretations of reporting requirements for several workload categories.

Second, the military departments and defense agencies have not

developed internal procedures and systems to facilitate timely and

accurate reporting. Third, the military departments, defense agencies and

OSD have not resolved questions concerning whether or not funding for

some depot-level workloads should be included in computing the

public-private mix as required by 10 U.S.C. 2466. Without accurate data

and consistent reporting between the two sectors, the data provides only a

broad indication of the relative mix of funding provided to the public and

private sectors. Thus, until the problems are corrected, future reports of

5

Defense Depot Maintenance: Information on Public and Private Sector Workload Allocations

(GAO/NSIAD-98-41, Jan. 20, 1998).

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public and private sector workload distribution will continue to be

inaccurate.

Although DOD is not required by statute to report estimates of future

workload mix, it is essential that DOD maintain this data to support the

oversight and management of depot maintenance activities and to monitor

compliance with 10 U.S.C. 2466. Based on preliminary data developed by

the military departments and defense agencies, total DOD-wide depot-level

maintenance funding will increase from $13.4 billion in fiscal year 1998 to

$15.4 billion in fiscal year 2003. While not yet resolved, the Air Force and

the Army are considering changes in future reporting criteria for several

workload categories that could reduce the amount of reported depot-level

funding in future years.

DOD Report of Depot

Maintenance Funds

Allocated to the

Public and Private

Sectors Is Inaccurate

In February 1998, DOD reported that the military departments and defense

agencies allocated a total of $10.3 billion in depot maintenance funds for

fiscal year 1997—$6.5 billion, or 63 percent, to public sector facilities and

$3.8 billion, or 37 percent, to private sector contractors. Our work shows

that the military departments did not develop complete and consistent

workload distribution information. For example, for fiscal year 1997, we

identified depot-level maintenance workloads valued at about

$1.9 billion—about $300 million for public sector workloads and

$1.6 billion for private sector workloads—that were not included in DOD’s

report. These categories are summarized in table 1. While recognizing the

lack of clarity in the reporting requirements, if included the public sector

share of depot maintenance funding would have been $6.8 billion, or about

56 percent, and the private sector share about $5.4 billion, or about

44 percent.

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Table 1: Our Estimate of Depot Maintenance Funding Not Reported in DOD’s Fiscal Year 1997 Workload Distribution Report

Dollars in millions

Category SOCOM Navy Army Air Force Total

ICS/CLS $85.0 $40.7 $97.0 $622.5 $845.2

Modification/upgrade 51.7 67.0 118.7

Software support 48.3 48.3

Nonworking capital fund facilities 84.0a 51.0 2.7 137.7

Classified and intelligence support 358.0 358.0

Ship maintenance 259.8 259.8

Air Guard and Reserve 81.0 81.0

Materials 42.3 2.8 45.1

Total $85.0 $426.8 $202.5 $1,179.5 $1,893.8

Note: SOCOM (Special Operations Command).

aThe Navy received $168.1 million for maintenance support at nonworking capital fund activities.

Military officials stated that these funds support both depot-level and intermediate-level work;

however, funding for the two maintenance levels cannot be separately identified. Our analysis

assumes that 50 percent, or about $84 million, was for depot-level work.

In reviewing a draft of this report, DOD questioned or provided clarifying

information about several of the estimates in our draft report. We analyzed

the data provided and, in some cases, revised the estimates. DOD’s

comments and our changes, where appropriate, are presented in the

following discussions describing each workload category. In the

subsequent report section, we show that these reporting problems

occurred primarily because of weaknesses in the DOD criteria for

identifying depot-level maintenance workloads and in the military

services’ data collection procedures.

Funding for ICS and CLS

Workloads

As requested by OSD’s December 1997 data collection and reporting

guidance, the services identified about $845.2 million for the funding of

depot-level maintenance workloads categorized as ICS, CLS, and other

similar arrangements such as flexible sustainment. However, DOD chose

not to report this amount in the 1997 report because (1) the Air Force

developed preliminary data but did not report this information to OSD;

(2) DOD officials did not want to report data for the other services without

similar information from the Air Force; and (3) in its view, DOD had no

statutory obligation to report these funds until fiscal year 1998.

Page 6 GAO/NSIAD-98-175 Defense Depot Maintenance
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We agree that the statute did not specifically require these workloads to be

reported until fiscal year 1998. Nevertheless, we previously reported that

DOD did not include ICS and CLS in calculating the percentage of depot

maintenance funding allocated to the private sector.6

 We have also

reported that these contract maintenance activities are increasing

significantly, particularly for new systems.7

 Each year since DOD has been

developing public-private sector workload distribution data, including

fiscal year 1997, OSD has asked the services to identify the amount of

workload included in the ICS and CLS categories. Further, in most of the

years DOD reported public-private sector mix data to Congress, it provided

the ICS and CLS data separately to enable the decisionmakers to assess the

overall impact on public and private sector workload distribution.

The Air Force Materiel Command identified $622.5 million in ICS and CLS

funding, but Air Force headquarters staff did not report this information to

OSD. The Air Force said it was uncertain of the amount of depot-level

maintenance funding in the ICS and CLS categories because of data

inconsistencies identified by the Air Force Audit Agency. Subsequent to

DOD’s congressional report, the Air Force added this information to its

internal records identifying public and private sector workload

distribution. We did not review in detail the information supporting this

data. However, we did note that OSD guidance specifically directed the Air

Force to report C-9 maintenance funding it manages for the Defense

Health Program. Supplemental reporting instructions from Air Force

headquarters specified that funding for the cryptology systems support

office was to be included in the workload distribution report. The ICS and

CLS funding data includes $25.2 million for maintenance and repair of C-9

aircraft for the health program and $60.2 million for depot-level support of

cryptology programs. Later in this report we discuss other public and

private sector funding provided to nonworking capital funded facilities for

cryptology programs.

Funding for Modification

and Upgrade Workloads

OSD directed the military departments and defense agencies to report

maintenance and repair workloads involving the overhaul, upgrade, or

rebuilding of weapon systems, regardless of the source of funds. While

OSD’s guidance states that depot-level maintenance workloads do not

6

Defense Depot Maintenance: Information on Public and Private Sector Workload Allocations

(GAO/NSIAD-98-41, Jan. 20, 1998); Defense Depot Maintenance: More Comprehensive and Consistent

Data Needed for Decisionmakers (GAO/NSIAD-96-166, May 21, 1996); and Depot Maintenance: Issues

in Allocating Workloads Between the Public and Private Sectors (GAO/T-NSIAD-94-161, Apr. 12, 1994).

7

Defense Depot Maintenance: DOD Shifting More Workload for New Weapon Systems to the Private

Sector (GAO/NSIAD-98-8, Mar. 31, 1998).

Page 7 GAO/NSIAD-98-175 Defense Depot Maintenance
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include procurement of modifications or upgrades that are designed to

improve performance, or the procurement of parts for safety

modifications, OSD directed the services to report funding for installation

of all modification and upgrade kits.

Our work did not disclose any incomplete reports of Navy funding for

installation of modification and upgrade kits. While the Air Force and the

Army data for 1997 included funding provided to public sector facilities for

installation of modification and upgrade kits, they did not report about

$118 million in procurement funding provided to private sector

contractors for this work. Reporting funding data for one sector but not

the other is inconsistent with OSD guidance and provides misleading

information about the relative mix of funding.

Navy’s Report The Navy reported $290.3 million in procurement and operations and

maintenance appropriation funding for installing modification kits on

naval aircraft and ships; 43 percent was provided to public depot activities

and 57 percent to private sector contractors. Navy aviation officials stated

that because OSD’s guidance specified that all modification installation

work should be included, they made no effort to separate funding for

installation of modifications designed to improve weapon system

performance from installation of modifications designed to correct safety

deficiencies. For example, the Navy’s report included $7.6 million for

public depot employees to install laser designators to enhance the

operational capabilities of F-14 aircraft. In addition, the report includes

$12.8 million for contractor installation of new airframe components and

systems to extend the operational service life of P-3 aircraft.

Air Force’s Report The Air Force reported $119.7 million in procurement appropriation funds

paid through the Air Force depot maintenance working capital fund for

installation of modification and upgrade kits by public depots and

$1.2 million for installation of modification and upgrade kits by private

sector contractors. However, the Air Force did not report at least

$67.0 million in direct appropriation funded payments. Air Force officials

were initially concerned about duplicate reporting and errors found by the

Air Force Audit Agency in similar types of contractor support and decided

not to report this funding to OSD and Congress. After the workload

distribution report was sent to Congress, the Air Force internally revised

its fiscal year 1997 workload distribution data to include $47.3 million

recorded in a headquarters-managed database for monitoring modification

installation contract funding. Further, the Air Force is using this database

to support its fiscal years 1998-2003 workload distribution estimates. In

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reviewing the database and other supporting documents, we noted that an

additional $19.7 million for contractor installation of modification kits on

aircraft for intelligence programs was not recorded in the database and

should have been reported under the current guidelines. Air Force

Materiel Command workload distribution data for fiscal years 1998

through 2003 indicates that these workloads will be included in future

reports. We also noted other possible errors and omissions in the

database. For example, the T-1A aircraft and simulator programs are not

part of the database, but budget documents and information reported by

the Air Force Materiel Command indicate modification installation efforts

during fiscal year 1997.

Army’s Report For five major Army weapon systems,8 the Army reported operations and

maintenance funding totaling $137.2 million for support of various

modification and upgrade projects, of which $120.2 million was provided

to public sector depots. However, we identified at least $51.7 million in

procurement funding for contractor and public depot installation of

modification and upgrade kits that were not reported.9

 An official

representing the Assistant Secretary of the Army for Research,

Development, and Acquisition stated this funding was not reported

because the Army believes 10 U.S.C. 2460 does not require that funding

should be reported for major modification and upgrade projects financed

through the procurement appropriation. However, this interpretation was

not consistent with OSD’s December 1997 reporting guidance, which

directed the services to report funding for installation of modification and

upgrade kits when the installation is considered a depot-level service.

Further, subsection (a) of 10 U.S.C. 2460 states that depot-level

maintenance is to include all of the specified workload functions

“regardless of the source of funds for the maintenance or repair.”

Funding for Software

Maintenance Workloads

OSD specified that depot-level maintenance included funding for the

maintenance and repair of computer software supporting deployable

weapon systems and their components, space control systems and their

components, and automated test equipment. The Army report included

8

These weapon systems are the Paladin, Abrams, Bradley, M113 family of vehicles, and Apache. These

are the Army’s five largest upgrade and modification projects involving depot-level maintenance tasks.

9

We also identified an additional $1.1 billion in procurement funding that supported major

modification and conversion projects; however, program officials could not separately identify funding

for new hardware (kits) and funding for installation services.

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$142 million, the Navy $168 million, and the Air Force $443 million.10

However, the Air Force did not report $48.3 million in nonworking capital

funds provided for depot-level software maintenance accomplished at the

Space Systems Software Group at Peterson Air Force Base,

Colorado—$47 million for work performed by private sector employees

and $1.3 million for work performed by federal employees. In commenting

on a draft of this report, Air Force officials told us they did not report

these funds because, in their view, the Space Systems Support Group

generally did not perform depot-level maintenance. In its November 1997

report, the Logistics Management Institute stated that the military

departments had not adopted a consistent approach and methodology for

identifying and reporting depot-level software maintenance funding.11

We continue to believe the $48.3 million should have been reported based

on the Space Systems Software Group charter and the memorandum of

understanding signed by the Air Force Materiel Command and Space

Command in 1993. The charter and memorandum make the Materiel

Command responsible for lifetime system support, to include level 2

software maintenance on launch vehicles and critical ground systems.

Level 2 tasks are defined as designing, coding, modifying, and testing all

changes in operational mission and support software and databases,

which, according to Air Force officials, are categorized as depot-level

maintenance workloads.

In January 1998, we reported12 that for the previous reporting period, the

Air Force did not report software maintenance funding for the Peterson

Air Force Base, Colorado, software support activity. In commenting on our

1997 draft report on the public-private mix of depot maintenance

workloads, the Air Force acknowledged that funding for the Colorado

facility should have been included in the Air Force’s depot maintenance

data for that year and it is unclear why the Air Force has changed its

position on this issue. We continue to believe the work is depot

maintenance and should be reported.

10This amount includes funding of $17.9 million processed through the working capital fund for

depot-level software maintenance by the Space Systems Support Group at Peterson Air Force Base,

Colorado.

11Maintenance of Department of Defense Mission Critical and Mission Support Software: A Preliminary

Characterization, Logistics Management Institute (LG518TI/Nov. 1997).

12Defense Depot Maintenance: Information on Public and Private Sector Workload Allocations

(GAO/NSIAD-98-41, Jan. 20, 1998).

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Funding for Depot-Level

Maintenance Workloads

Performed by Nonworking

Capital Fund Activities

OSD directed the services to include in their compilations of public and

private sector workload distributions the funding for maintenance work

done by nonworking capital funded activities. Traditionally, DOD has not

recognized these activities as depot maintenance providers.13 DOD was not

consistent in reporting the amount of funding for depot-level maintenance

tasks accomplished by these providers. For example, the active Army did

not report about $51 million for depot-level tasks accomplished at

integrated sustainment maintenance and repair sites at various Army field

activities. The Army categorizes integrated sustainment maintenance

facilities as direct support and general support facilities, which are

maintenance support layers below depot level. However, the Army

Materiel Command allows integrated sustainment maintenance facilities to

accomplish depot-level tasks under special repair authorities. Army

officials told us funding for these workloads was not included in the

Army’s report of depot-level maintenance funding because the integrated

sustainment maintenance facilities are not traditionally recognized as

depot-level maintenance providers. On the other hand, the Army Reserve

and National Guard reported $17.6 million in operations and maintenance

funding for repairing wheeled vehicles at these same type facilities. In

commenting on a draft of this report, Army officials stated that depot-level

work accomplished at integrated sustainment maintenance facilities under

special repair authorities would be included in future reports and that the

reporting inconsistencies between the active and reserve components will

be addressed in future workload distribution reporting.

Likewise, the Navy did not report any of the $168.1 million14 it received for

maintenance support at Trident Refit Facilities in Bangor, Washington, and

Kings Bay, Georgia. While officially labeled as intermediate-level

maintenance and repair facilities, the activities were specifically designed

to provide incremental depot overhaul and repair of the Trident submarine

fleet and depot-level repair of Trident equipment. OSD and Navy officials

agreed that these funds supported some depot-level maintenance tasks.

However, the amounts specifically provided for depot-level workloads

could not be separately identified. Our analysis of depot-level maintenance

funding that was not included in DOD’s workload distribution report

13In recent years, the distinction between depot-level repair and other levels of repair has become

increasingly obscure. DOD’s 22 public depots are financed with working capital funds. Customers

desiring depot-level services from these facilities reimburse the working capital fund with

appropriated monies. Nonworking capital funded maintenance and repair facilities are financed

through direct appropriations, and customers are not charged on a per item basis as they are for

operations funded through the working capital fund.

14This amount does not include funds received for military salaries.

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assumes that 50 percent of the total funding for these facilities, or

$84 million, supports depot-level maintenance work.

In providing comments on a draft of this report, OSD and Navy officials

acknowledged that the Trident Refit Facilities do accomplish some

depot-level tasks. However, while they did not agree with our assumption

that as much as half of the total funding for the facilities could be

attributed to depot-level work, they could not provide an alternative

estimate. Officials also stated that funding for the refit facilities should not

be reported because the facilities have no refueling capability and are

excluded from DOD’s list of major depot-level maintenance depot activities.

Notwithstanding these comments, we believe the portion of the refit

facilities’ workload that is depot-level work should be reported as such.

Further, the capability to do a refueling is not a requirement for a ship

repair facility—either public or private—to be considered as a depot-level

maintenance provider. For example, currently only two private shipyards

have refueling capability, yet many others are considered by the Navy to

be depot-level repair facilities. Finally, the refit facilities are authorized to

perform depot-level repairs of numerous repairable components and were

specifically designed for the incremental overhaul and repair of the

Trident fleet. Therefore, we believe the Navy needs to develop a

methodology to analyze and document the amount of depot-level

maintenance funding made available to the refit facilities prior to the next

public and private sector workload distribution reporting cycle.

The Air Force did not report $2.7 million for private sector support of

depot-level maintenance work at a nonworking capital funded facility

supporting cryptology workloads. However, the Air Force reported

$10.5 million in public sector funding for the same facility. As previously

discussed, the Air Force also did not fully report nonworking capital

funding for installation of modification and upgrade kits and space system

software maintenance. Further, former San Antonio engine repair

workloads are now being performed by contractors working at Military

Airlift Command bases in California and Delaware; however, these

nonworking capital funded activities were not included in the Air Force’s

data call. In commenting on a draft of this report, Air Force officials

acknowledged that work on the TF39 engine was previously performed in

a public depot and reported as depot-level workload under the two-level

maintenance concept. However, they stated that an Air Force policy

change transitioned the TF39 engine to a three-level maintenance concept

and reclassified the former San Antonio work as an intermediate-level

workload. Further, this policy change and workload reclassification from

Page 12 GAO/NSIAD-98-175 Defense Depot Maintenance
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depot-level to intermediate-level enabled the Air Force to drop this work

from its workload distribution report. While we agree that the distinction

between depot-level repair and other levels of repair has become

increasingly obscure, we continue to believe funding for the repair of TF39

engine workloads should be reported in the public and private sector

workload allocations.

Funding for Classified and

Intelligence Programs

OSD asked the services to include in their public and private sector

workload distribution reports depot-level maintenance funds for classified

programs (special access required) and military systems and equipment

required for foreign intelligence support whenever the military department

managed or controlled the source of funds. However, we observed one

instance where the Air Force reported $1.4 million for public sector work

in this area, but did not report $358 million for private sector work. Air

Force officials cited several reasons for not reporting this work:

(1) concerns raised by the Air Force Audit Agency for similar contractor

supported workloads; (2) concerns about releasing sensitive data; and

(3) because funding for most of the work was programmed and budgeted

by other agencies. The Air Force gave no explanation of why it could

report the data for the public sector. We observed that, in previous years,

the Air Force has included funding for some classified and intelligence

programs in its collection of depot workload allocation data. We also

noted that this data was presented in an unclassified summary form.

Funding for Ship

Maintenance

The Navy reported $1.5 billion in operations and maintenance funding for

the overhaul and repair of naval ships. The public shipyards received

$786 million, or 51 percent, and the private sector $741 million, or about

49 percent. We found that the Navy did not report about $259.8 million in

miscellaneous support funding. According to Navy officials, they did not

have enough time to do the data collection and analysis required to

allocate this amount between the public and private sectors.

Funding for Air National

Guard and Air Force

Reserve

Our work shows that the Air Force understated by about $81.3 million, the

amount of funding managed by one of its air logistics centers for

depot-level support of Air National Guard and Air Force Reserve aircraft

and related components. An initial draft of this report estimated this

amount at $198 million. In commenting on a draft of this report, Air Force

officials acknowledged confusion over responsibilities for reporting and

documenting audit trails for this workload. Air Force officials claimed that

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B-279949 

funding for this workload was included in the compilation of public and

private sector workload distribution report provided to Congress.

However, our follow-on review and analysis indicates that the center

included $117 million of the $198 million in its compilation of public and

private sector workload distribution data that was submitted to Congress

in February 1998. Subsequently, after the workload distribution report was

sent to Congress, the Air Force determined that the center managed

funding totaling $198 million, or an additional $81 million over the amount

included in the report to Congress. We adjusted the figure contained in our

draft report to reflect the understated reporting of $81 million, rather than

the $198 million reflected in our earlier draft.

During the data collection process, the Air Force collected several sets of

data from its logistics centers and changed data collection methodologies.

For example, the data developed by the center for the report that was sent

to Congress was based on the agent perspective (funding for work

accomplished at the center). The later update was developed on the

principal perspective (total funding managed by the reporting entity

without regard to the location where the work is performed). It is possible

that some of this funding could have been reflected in the amounts

reported for the other air logistics centers. Nonetheless, variations in

reported funding were shown in several successive data submissions

where funding estimates changed substantially in total for each center and

by percents of public and private sector distribution.

The Air Force’s inability to crosswalk from one data set to another raises

questions about the accuracy and completeness of reported depot-level

funding data. Further, these uncertainties and inconsistencies illustrate

why we believe the services need to establish and implement detailed

procedures and systems to consistently identify and report funds made

available for depot-level maintenance workloads.

Funding for

Government-furnished

Material

OSD required that the public and private sector workload funding

distribution data collection include all factors of production. Thus, public

sector workload data should include purchases of government-furnished

material used in the production of repair and maintenance services

conducted by public depots and private sector workload data should

include the value of parts provided by the contractor as well as

government-furnished materials provided by DOD in the production of

repair and maintenance workloads assigned to the contractors. In two

instances, we found that the services did not report the value of

Page 14 GAO/NSIAD-98-175 Defense Depot Maintenance
B-279949 

government-furnished materials provided to private sector contractors.

The Navy did not report $42.3 million for purchases of parts and materials

provided to the private sector ship maintenance contractors. Likewise, the

Army did not report material costs for reparable items furnished to

contractors for use in contract repair. For example, the Army did not

report $2.8 million for parts financed with procurement appropriation

funding that were furnished to the contractor for repair of the Apache

Longbow aircraft.

Funding Provided to

Nonfederal Workers

Classified as Public Sector

Workload

Our work shows that the Army reported funding provided to nonfederal

workers as public sector workloads. For example:

• The Army National Guard reported as a public sector workload about

$7 million in operations and maintenance funding provided to nonfederal

employees in several states for depot-level repair of night vision devices

and tactical wheeled vehicles. National Guard officials stated that they

reported it this way because they considered the employees as federal

workers, even though they were not. Our discussions with officials from

the Oregon National Guard indicate that depot-level repair of night vision

devices is performed by 16 state employees who were hired to accomplish

this workload. Once the work is completed, they will be terminated. In

commenting on a draft of this report, Army officials stated that this

reporting discrepancy will be corrected prior to the next public and

private sector workload distribution reporting cycle.

• The active Army inadvertently classified $1.1 million in funding for

contractor-employed field teams as public sector workload.

Data Collection

Procedures Are Better

but More Needs to Be

Done

The reporting problems identified in the preceding section are largely

attributable to weaknesses in the DOD criteria for identifying depot-level

maintenance workloads and the military departments’ data collection and

reporting procedures for compiling and summarizing the percentage of

public and private sector workload distribution. Although Congress has

required reports on public and private sector workload distribution data in

all but one year since 1991, the data has been collected each year on an ad

hoc basis. In December 1997, shortly after Congress established the

current data collection and reporting process in the 1998 Defense

Authorization Act, OSD issued more thorough data collection requirements

to the military departments. However, as in the past, the services used

ad hoc procedures to collect the requested information. As a consequence,

the services’ responsiveness to the request varied and each service

Page 15 GAO/NSIAD-98-175 Defense Depot Maintenance
B-279949 

experienced varying degrees of difficulty developing the data. Because

they did not have adequate internal data collection procedures and

systems to facilitate timely, complete, and accurate workload distribution

reports, the Air Force and the Army asked their audit agencies to review

and comment on the data collection and reporting process. Without

accurate and consistent reporting between the public and private sectors,

the data reported to Congress provides only a broad indication of the

relative mix of work assigned to the two sectors. Until reporting problems

are corrected, future reports of public and private sector workload

distribution will continue to be inaccurate.

OSD Substantially

Improved Its Guidance

Overall, OSD’s new data collection guidance to the military departments is

more comprehensive than earlier guidance it issued for prior reporting

periods. However, we found that the guidance could have been more

specific for reporting (1) modifications and upgrade work and (2) funds

for work performed by one military department but budgeted and received

by another service or defense agency.

On December 5, 1997, about 2 weeks after Congress established the

current workload reporting process, the Deputy Under Secretary of

Defense (Logistics) issued detailed guidance to establish a standardized

methodology for collecting and reporting depot-level maintenance funds

provided to the public and private sectors. In line with the fiscal year 1998

Defense Authorization Act, this guidance summarized depot maintenance

workload definitions specified by 10 U.S.C. 2460 and included various

supplemental workload definitions and reporting instructions.

Also, OSD held meetings with key personnel from each military department

and defense agency to discuss and clarify data requirements. OSD’s

guidance specifically required them to report funding for (1) depot-level

maintenance performed by DOD employees; (2) depot-level maintenance

work contracted for performance by nonfederal employees; (3) depot-level

maintenance work obtained from interim contractor support, contractor

logistics support, and other similar contractual arrangements;

(4) depot-level software maintenance performed by DOD employees;

(5) depot-level software maintenance contracted for performance by

nonfederal employees; and (6) depot-level maintenance work done by

nonfederal employees working at government-owned and operated

facilities.

Page 16 GAO/NSIAD-98-175 Defense Depot Maintenance
B-279949 

Based on our review, this guidance, though improved from prior years,

contained several ambiguities that contributed to inconsistent and

incomplete reporting. For example:

• The guidance required the services to report all funding for installation of

modification and upgrade kits when the installations were considered

depot-level services. The guidance also stated that procurement of

modifications and upgrades were to be excluded from reporting when the

modifications were designed to improve program performance. As stated

previously, Navy aviation officials interpreted the guidance to require

reporting of all modification work, but the Army interpreted the guidance

to exclude funding for modification and upgrade installation work

financed through the procurement appropriation.

• The guidance specifies that the principal military department or agency

responsible for programming and budgeting should report funding made

available for depot maintenance workloads. The military department or

defense agency performing the work on behalf of another would be

considered an agent and, therefore, would not be required to report.

However, the guidance specifically required the Air Force to report

funding for maintenance programs it managed in support of Defense

Medical Program funded aircraft. Similar questions have not been resolved

with regard to reporting responsibilities for other workload categories,

including intelligence programs, foreign military sales, interserviced

workloads, and items having dual sources of repair.

OSD officials stated that guidance for these situations will be updated for

the next reporting cycle.

Military Services Still Lack

Comprehensive

Procedures and Systems to

Facilitate Timely and

Accurate Workload

Distribution Reports

The military services do not have the procedures and support systems to

provide consistent, accurate, and timely reporting of public and private

sector depot maintenance workload distribution data. Further

complicating the 1997 report, the military departments solicited

information from hundreds of different commands, organizations, and

program management offices, some of which had not been involved in

identifying and reporting depot maintenance workload distribution data in

the past.

OSD directed the services and defense agencies to provide information on

fiscal year 1997 depot-level maintenance funding no later than January 5,

1998, and to submit a second report of planned depot-level maintenance

funding for fiscal years 1998 through 2003 by February 17, 1998. However,

Page 17 GAO/NSIAD-98-175 Defense Depot Maintenance
B-279949 

these time frames were not met. The Navy submitted its information for

fiscal year 1997 funding on January 6, the Army on January 16, and the Air

Force on February 2, 1998. The Navy submitted its report on future year

funding on March 17 and the Army on April 1, 1998. As of June 1998, the

Air Force headquarters staff said they had not yet completed their analysis

of future year workload information. However, the Air Force Materiel

Command developed preliminary data that was submitted to Air Force

Headquarters for further analysis.

Services Seek Assistance

From Audit Agencies

The Air Force and the Army recognized the potential for incomplete and

inconsistent reporting of public and private workload distribution reports.

Accordingly, each asked its audit service to review its data collection

process and recommend procedural changes.

Air Force auditors identified numerous errors and inconsistencies in

workload distribution data compiled by the Air Force Materiel Command,

including duplicate reporting, overstated reporting of funding provided to

contractors, and use of budget projections rather than actual obligations.

As a result of the Air Force Audit Agency’s findings, the Command

required a second data call of its field activities to improve the consistency

and quality of the data. However, this updated information was not

provided to Congress. Air Force officials stated that the updated

information was not provided to Congress, because the revised numbers

would not impact compliance with 60/40 thresholds.

Army auditors identified funding for depot-level maintenance services that

the Army did not include in its workload distribution reports, including

(1) private sector support obtained through manufacturer warranties,

(2) funding for depot-level maintenance workloads at nonworking capital

funded repair activities, (3) software maintenance workloads funded by

program executive offices, and (4) funding for contract administration. OSD

officials plan to issue clarifying guidance for these and other workload

categories prior to the next reporting cycle.

Implications of

Changes Being

Considered for Future

Reporting

Based on preliminary data developed by the military departments and

defense agencies, total DOD-wide depot-level maintenance funding will

increase from $13.4 billion in fiscal year 1998 to $15.4 billion in fiscal

year 2003. While not yet resolved, the Air Force and the Army are

considering changes in future reporting criteria for several workload

Page 18 GAO/NSIAD-98-175 Defense Depot Maintenance
B-279949 

categories that could reduce the amount of reported depot-level funding in

future years.

Even though the military departments and defense agencies are not

required by statute to provide estimates of future public and private sector

workload allocations, OSD requested the information as part of its

oversight responsibility to monitor compliance with 10 U.S.C. 2466. In

prior years, DOD has furnished this information to Congress in its report on

the allocation of depot maintenance workload between the public and

private sectors. While we obtained the outyear information, DOD did not

provide it to Congress as a part of its annual report on the public private

mix. Table 2 shows the workload forecasts reported to OSD by the defense

agencies and the Army and the Navy for fiscal years 1998 through 2003.

The table also includes preliminary estimates of future data developed by

the Air Force Materiel Command.

Table 2: DOD’s Estimate of Public and Private Depot Maintenance Workload Distribution for Fiscal Years 1998 Through

2003

Dollars in millions

Agency/

service

Workload

distribution 1998 1999 2000 2001 2002 2003

DIA Public work

Private work

Public/private split

0.1

0

100/0

0.1

0

100/0

0.1

0

100/0

0.1

0

100/0

0.1

0

100/0

0.1

0

100/0

SOCOM Public work

Private work

Public/private split

22.6

112.2

17/83

29.2

129.0

18/82

30.8

125.4

20/80

31.6

114.8

21/79

38.7

99.6

28/72

39.6

101.3

28/72

Navy Public work

Private work

Public/private split

4,074.2

2,097.4

66/34

3,987.9

2,401.7

62/38

4,223.3

2,319.7

64/36

4,104.1

2,377.5

63/37

4,234.9

2,245.0

65/35

4,659.9

2,337.5

67/33

Army Public work

Private work

Public/private split

914.1

611.3

60/40

940.3

606.2

61/39

941.5

639.2

60/40

927.6

643.0

59/41

1,052.9

654.1

62/38

1,111.5

622.6

64/36

Air Force Public work

Private work

Public/private split

3,112.3

2,503.8

55/45

3,259.7

2,675.2

55/45

3,379.2

2,752.5

55/45

3,447.6

2,737.8

55/45

3,482.6

2,840.7

55/45

3,600.7

2,947.5

55/45

Note: DIA (Defense Intelligence Agency); SOCOM (Special Operations Command).

Source: DOD and military departments

Changes in Reporting

Criteria Proposed by the

Air Force

The Air Force has not yet finalized its report to OSD of planned public and

private sector depot maintenance funding for fiscal years 1998 through

2003. Tentative numbers, as shown above, include estimates of future year

Page 19 GAO/NSIAD-98-175 Defense Depot Maintenance
B-279949 

funding for several workload categories for which the Air Force has

proposed changes in reporting criteria. Included are proposals to eliminate

funds provided for depot-level maintenance workloads involving

(1) classified and intelligence programs and (2) medical support aircraft,

that the Air Force manages for other agencies. If adopted, these changes

would reduce the amount of contract maintenance reported in future

years.

The Air Force’s preliminary estimates of future year depot-level

maintenance funding reflects other decisions that decrease the amount of

reported private sector depot-level maintenance funding. For example, the

Air Force estimate of future funding (1) includes a 1.5-percent reduction in

the amount of contracted depot-level maintenance funding to provide for

the government’s contract administration costs, (2) reports as public

sector workload funding for material and overhead expenses incurred by

contractor personnel working at government-owned and -operated depots,

and (3) excludes funding for space systems software support as previously

discussed.

Changes in Reporting

Criteria Proposed by the

Army

The Army’s report of planned future year public sector depot-level

maintenance workload includes funding for work to be conducted in

public depots in support of various modification and upgrade projects.15

As directed by an OSD program budget decision, funding for this work will

be transferred from the operations and maintenance appropriation to the

procurement appropriation. Although depot-level maintenance tasks will

continue to be conducted in support of the major upgrade programs, the

Army will classify funding for such purposes as acquisition expenses, not

depot maintenance. Consequently, Army acquisition officials plan to delete

these type funds from future public-private sector workload distribution

reports based on their interpretation of 10 U.S.C. 2460, which excludes

funding for procurement of major modifications of weapon systems that

are designed to improve program performance. If implemented, this

change will reduce the amount of public sector depot maintenance

reported in future years.

Conclusions In February 1998, DOD reported that the military departments and defense

agencies allocated a total of $10.3 billion in depot maintenance funds for

fiscal year 1997—$6.5 billion, or 63 percent, to public sector facilities and

15These annual amounts range between $156 million in fiscal year 1999 and $187 million in fiscal

year 2003.

Page 20 GAO/NSIAD-98-175 Defense Depot Maintenance
B-279949 

$3.8 billion, or 37 percent, to private sector contractors. Our work shows

that the military departments did not develop complete and consistent

workload distribution information. For example, for fiscal year 1997, we

identified depot-level maintenance workloads valued at about

$1.9 billion—about $300 million for public sector workloads and

$1.6 billion for private sector workloads—that were not included in DOD’s

report. While recognizing the lack of clarity in the reporting requirements,

if included, the public sector share of depot maintenance funding would

have been $6.8 billion, or about 56 percent, and the private sector share

about $5.4 billion, or about 44 percent.

This condition exists for three reasons. First, OSD guidance—while

substantially improved over prior years—leaves room for varying

interpretations of reporting requirements for several workload categories.

Second, the military departments and defense agencies have not

developed internal procedures and systems to facilitate timely and

accurate reporting. Third, the military departments, defense agencies, and

OSD have not resolved questions concerning whether or not funding for

some depot-level workloads should be included in computing the

public-private mix as required by 10 U.S.C. 2466. Without accurate data

and consistent reporting between the two sectors, the data provides only a

broad indication of the relative mix of funding provided to the public and

private sectors. Thus, until the problems are corrected, future reports of

public and private sector workload distribution will continue to be

inaccurate.

Although DOD is not required by statute to report estimates of future

workload mix, it is essential that DOD maintain this data to support the

overall management of depot maintenance activities and to monitor

compliance with 10 U.S.C. 2466. Based on preliminary data developed by

the military departments and defense agencies, total DOD-wide depot-level

maintenance funding will increase from $13.4 billion in fiscal year 1998 to

$15.4 billion in fiscal year 2003. While not yet resolved, the Air Force and

the Army are considering changes in future reporting criteria for several

workload categories that could reduce the amount of reported depot-level

funding in future years.

Recommendations To improve the accuracy of future mandated public and private sector

workload distribution reports, we recommend that the Secretary of

Defense

Page 21 GAO/NSIAD-98-175 Defense Depot Maintenance
B-279949 

• direct that the Secretaries of the military departments and commanders of

the defense agencies establish and document internal operating

procedures for collecting data and reporting public and private sector

depot-level workload distribution. The procedures should clearly identify

the specific commands and activities responsible for submitting data and

describe the records and systems from which documentation will be

pulled and the minimum documentation to be retained for follow-up.

Procedures should also require monitoring of the implementation, to

assure consistency of reporting between the services, and facilitate timely

and accurate collection of data for the next annual report.

• establish milestones for issuing clarifying instructions stating whether or

not installation of modification and upgrade hardware financed with

procurement appropriation funding should be included in future public

and private workload distribution reports and assure consistency in

reporting among the public and private sectors. The milestones should be

established to allow for timely collection and reporting of data for the next

congressional reporting cycle.

• establish milestones and issue guidance to resolve questions concerning

responsibilities for reporting depot-level maintenance funding for

(1) classified and intelligence programs, (2) medical support equipment,

(3) space systems software, and (4) contract administration. The

milestones should be established to allow for timely collection and

reporting of data for the next congressional reporting cycle.

• direct the Secretaries of the military departments to develop

methodologies for aggregating and reporting the amount of

funding—regardless of the source of funding—for depot-level work

accomplished at non-working capital funded repair sites, including Navy

Trident Refit Facilities, Army Integrated Sustainment Maintenance

Activities, and other similar repair sites prior to the next congressional

reporting period.

Agency Comments We requested comments on a draft of this report from the Secretary of

Defense. On May 20, 1998, the Acting Principal Assistant Deputy Under

Secretary of Defense (Logistics) and representatives from the military

departments provided the following comments on the draft report. DOD

generally concurred with the intent of our recommendations and stated

that appropriate actions will be taken to (1) establish and document data

collection systems and procedures for each military department and

defense agency and (2) further clarify reporting guidance. If effective

implementation plans and milestones are adopted along the lines we

recommended, DOD’s planned actions should improve the accuracy,

Page 22 GAO/NSIAD-98-175 Defense Depot Maintenance
B-279949 

consistency, and completeness of future public and private sector

workload distribution reports. DOD officials also commented that

extending the congressionally imposed reporting date from February 1 to

March 1 would increase the completeness and accuracy of future

workload distribution reporting.

DOD did not agree that its report to Congress on fiscal year 1997 workload

allocations understated the amount of depot-level funding made available

to the military departments and defense agencies for certain workload

categories. As discussed below, we continue to believe that various

workload categories were not reported.

• Most of DOD’s concerns related to whether $1.3 billion in funding for ICS,

CLS and similar contracted workloads was to be reported. DOD stated that

the statute did not specifically require it to report these workloads until

fiscal year 1998. However, in most of its previous reports of public and

private sector workload mix, DOD provided ICS and CLS data to Congress

separately, to enable the decisionmakers to assess the overall impact on

public and private sector workload distribution. We have supported the

inclusion of ICS and CLS funding in the assessment of public and private

sector workload distribution to the extent it represents depot-level

maintenance workload. Further, the fiscal year 1998 Defense

Authorization Act requires that the next annual report include these

workload categories.

• DOD acknowledged that Trident Refit Facilities accomplish limited

depot-level maintenance tasks. However, it stated that actual depot-level

work accomplished at these facilities was less than the 50 percent on

which our estimate is based, but could not provide an alternative estimate.

Lacking additional information, we did not change our estimate of funding

for this workload category that was not reported. Based on DOD’s

comments, we added a recommendation concerning the future reporting

of funding for this workload category.

• DOD stated that $198 million in funding provided for support of Air

National Guard and Air Force Reserve aircraft was included in DOD’s

congressional report of public and private sector workload distribution.

However, Air Force officials acknowledged weaknesses in the Air Force

procedures for adequately documenting its quantification and reporting of

this information. Our follow-on review and analysis indicates that

$117 million of the $198 million was included in the workload distribution

report that was sent to Congress in February 1998. However, an additional

$81 million in funding was not reported. Therefore, we lowered our

estimate of depot-level funding that was not reported to reflect $81 million

Page 23 GAO/NSIAD-98-175 Defense Depot Maintenance
B-279949 

for Air National Guard and Air Force Reserve aircraft, rather than the

$198 million reflected in our earlier draft report.

Scope and

Methodology

We reviewed DOD’s process for collecting and analyzing depot-level

maintenance funding information. We discussed and analyzed detailed

reporting instructions issued by OSD, and supplemental guidance issued by

the military departments. To evaluate the accuracy and consistency of

reported depot-level maintenance funding, we judgmentally selected,

reviewed, and analyzed back-up materials developed by the Army, Navy,

Marine Corps, Air Force, and related defense agencies. Back-up

documentation included budget exhibits, computerized worksheets,

electronic mail messages and summary reports. We did not independently

assess the accuracy of the data contained in the back-up documentation.

We drew extensively from our prior work concerning the public and

private sector depot workload mix and reviewed the results of ongoing

audit work being conducted by the Air Force and the Army Audit

Agencies. Because DOD did not have procedures in place to identify and

collect information on the full range of potential depot-level maintenance

funding made available to the military departments and defense agencies,

our estimate of funds not reported addresses only the areas identified

during our work. Once better procedures are in place, other areas may be

identified.

We interviewed officials and examined documents at OSD and Army, Navy,

Air Force, and Marine Corps headquarters, Washington, D.C.; Army

Materiel Command, Alexandria, Virginia; Air Force Materiel Command,

Dayton, Ohio; Naval Sea Systems Command, Arlington, Virginia; Naval Air

Systems Command, Patuxent River, Maryland; Space and Naval Warfare

Systems Command, San Diego, California; Space Systems Support Group,

Peterson Air Force Base, Colorado; Air Force Audit Agency, Dayton, Ohio;

Army Audit Agency, Alexandria, Virginia; Army Tank Automotive

Command and the Program Executive Office for Ground Combat and

Support Systems, Warren, Michigan; and the Army Aviation Missile

Command and the Program Executive Office for Aviation, Huntsville,

Alabama. For fiscal years 1998 through 2003, we obtained and reviewed

preliminary reports of public and private sector workload distributions

from Navy and Army headquarters, Washington, D.C.; Air Force Materiel

Command, Dayton, Ohio; and pertinent defense agencies.

We conducted our review from February to May 1998, and, except where

noted, in accordance with generally accepted government audit standards.

Page 24 GAO/NSIAD-98-175 Defense Depot Maintenance
B-279949 

We are sending copies of this report to the Secretaries of Defense, the

Army, the Navy, and the Air Force; and to the Directors of the Defense

Intelligence Agency and the Special Operations Command. Copies will be

made available to others on request.

Please contact me at (202) 512-8412 if you or your staff have any questions

concerning this report. Major contributors to this report are listed in

appendix I.

David R. Warren, Director

Defense Management Issues

Page 25 GAO/NSIAD-98-175 Defense Depot Maintenance
Contents

Letter 1

Appendix I 

Major Contributors to

This Report

28

Related GAO Products 29

Tables Table 1: Our Estimate of Depot Maintenance Funding Not

Reported in DOD’s Fiscal Year 1997 Workload Distribution

Report

6

Table 2: DOD’s Estimate of Public and Private Depot

Maintenance Workload Distribution for Fiscal Years 1998 through

2003

19

Abbreviations

CLS Contractor Logistics Support

DOD Department of Defense

ICS Interim Contractor Support

OSD Office of the Secretary of Defense

Page 26 GAO/NSIAD-98-175 Defense Depot Maintenance
Page 27 GAO/NSIAD-98-175 Defense Depot Maintenance
Appendix I 

Major Contributors to This Report

National Security and

International Affairs

Division, Washington,

D.C

Barry Holman

Julia Denman

Glenn Knoepfle

Andrew Marek

Office of the General

Counsel

John Brosnan

Atlanta Field Office Bobby Worrell

Terry Wyatt

Chicago Field Office Bruce Fairbairn

Los Angeles Field

Office

Jean Orland

Page 28 GAO/NSIAD-98-175 Defense Depot Maintenance
Related GAO Products

Defense Depot Maintenance: Contracting Approaches Should Address

Workload Characteristics (GAO/NSIAD-98-130, June 15, 1998).

Public-Private Competitions: Review of San Antonio Air Force Depot

Solicitation (GAO/OGC-98-49, May 14, 1998).

Defense Depot Maintenance: Use of Public-Private Partnership

Arrangements (GAO/NSIAD-98-91, May 7, 1998).

Public-Private Competitions: Review of Sacramento Air Force Depot

Solicitation (GAO/OGC-98-48, May 4, 1998).

Navy Ship Maintenance: Temporary Duty Assignments of Temporarily

Excess Shipyard Personnel Are Reasonable (GAO/NSIAD-98-93, Apr. 21, 1998).

Public-Private Competitions: DOD’s Additional Support for Combining

Depot Workloads Contains Weaknesses (GAO/NSIAD-98-143, Apr. 17, 1998).

Defense Depot Maintenance: DOD Shifting More Workload for New

Weapon Systems to the Private Sector (GAO/NSIAD-98-8, Mar. 31, 1998).

Depot Maintenance: Lessons Learned From Transferring Alameda Naval

Aviation Depot Engine Workloads (GAO/NSIAD-98-10BR, Mar. 25, 1998).

Public-Private Competitions: Access to Records Is Inhibiting Work on

Congressional Mandates (GAO/T-NSIAD-98-111, Mar. 4, 1998).

Force Structure: Army’s Efforts to Improve Efficiency of Institutional

Forces Have Produced Few Results (GAO/NSIAD-98-65, Feb. 26, 1998).

Public-Private Competitions: Access to Records Is Inhibiting Work on

Congressional Mandates (GAO/T-NSIAD-98-101, Feb. 24, 1998).

Public-Private Competitions: DOD’s Determination to Combine Depot

Workloads Is Not Adequately Supported (GAO/NSIAD-98-76, Jan. 20, 1998).

Public-Private Competition: Processes Used for C-5 Aircraft Award Appear

Reasonable (GAO/NSIAD-98-72, Jan. 20, 1998).

DOD Depot Maintenance: Information on Public and Private Sector

Workload Allocations (GAO/NSIAD-98-41, Jan. 20, 1998).

Page 29 GAO/NSIAD-98-175 Defense Depot Maintenance
Related GAO Products

Air Force Privatization-in-Place: Analysis of Aircraft and Missile System

Depot Repair Costs (GAO/NSIAD-98-35, Dec. 22, 1997).

Outsourcing DOD Logistics: Savings Achievable, but Defense Science

Board’s Projections Are Overstated (GAO/NSIAD-98-48, Dec. 8, 1997).

Navy Regional Maintenance: Substantial Opportunities Exist to Build on

Infrastructure Streamlining Process (GAO/NSIAD-98-4, Nov. 13, 1997).

Air Force Depot Maintenance: Information on the Cost-Effectiveness of

B-1B and B-52 Support Options (GAO/NSIAD-97-210BR, Sept. 12, 1997).

Navy Depot Maintenance: Privatizing the Louisville Operations in Place Is

Not Cost-Effective (GAO/NSIAD-97-52, July 31, 1997).

Defense Depot Maintenance: Challenges Facing DOD in Managing Working

Capital Funds (GAO/T-NSIAD/AIMD-97-152, May 7, 1997).

Depot Maintenance: Uncertainties and Challenges DOD Faces in

Restructuring Its Depot Maintenance Program (GAO/T-NSIAD-97-111, Mar. 18,

1997, and GAO/T-NSIAD-97-112, May 1, 1997).

Navy Ordnance: Analysis of Business Area Price Increases and Financial

Losses (GAO/AIMD/NSIAD-97-74, Mar. 14, 1997).

Defense Outsourcing: Challenges Facing DOD as It Attempts to Save

Billions in Infrastructure Costs (GAO/T-NSIAD-97-110, Mar. 12, 1997).

High-Risk Series: Defense Infrastructure (GAO/HR-97-7, Feb. 1997).

Air Force Depot Maintenance: Privatization-in-Place Plans Are Costly

While Excess Capacity Exists (GAO/NSIAD-97-13, Dec. 31, 1996).

Army Depot Maintenance: Privatization Without Further Downsizing

Increases Costly Excess Capacity (GAO/NSIAD-96-201, Sept. 18, 1996).

Navy Depot Maintenance: Cost and Savings Issues Related to

Privatizing-in-Place the Louisville, Kentucky, Depot (GAO/NSIAD-96-202,

Sept. 18, 1996).

Page 30 GAO/NSIAD-98-175 Defense Depot Maintenance
Related GAO Products

Defense Depot Maintenance: Commission on Roles and Mission’s

Privatization Assumptions Are Questionable (GAO/NSIAD-96-161, July 15,

1996).

Defense Depot Maintenance: DOD’s Policy Report Leaves Future Role of

Depot System Uncertain (GAO/NSIAD-96-165, May 21, 1996).

Defense Depot Maintenance: More Comprehensive and Consistent

Workload Data Needed for Decisionmakers (GAO/NSIAD-96-166, May 21, 1996).

Defense Depot Maintenance: Privatization and the Debate Over the

Public-Private Mix (GAO/T-NSIAD-96-146, Apr. 16, 1996, and GAO/T-NSIAD-96-148,

Apr. 17, 1996).

Military Bases: Closure and Realignment Savings Are Significant, but Not

Easily Quantified (GAO/NSIAD-96-67, Apr. 8, 1996).

Depot Maintenance: Opportunities to Privatize Repair of Military Engines

(GAO/NSIAD-96-33, Mar. 5, 1996).

Closing Maintenance Depots: Savings, Personnel, and Workload

Redistribution Issues (GAO/NSIAD-96-29, Mar. 4, 1996).

Navy Maintenance: Assessment of the Public-Private Competition Program

for Aviation Maintenance (GAO/NSIAD-96-30, Jan. 22, 1996).

Depot Maintenance: The Navy’s Decision to Stop F/A-18 Repairs at Ogden

Air Logistics Center (GAO/NSIAD-96-31, Dec. 15, 1995).

Military Bases: Case Studies on Selected Bases Closed in 1988 and 1991

(GAO/NSIAD-95-139, Aug. 15, 1995).

Military Base Closure: Analysis of DOD’s Process and Recommendations

for 1995 (GAO/T-NSIAD-95-132, Apr. 17, 1995).

Military Bases: Analysis of DOD’s 1995 Process and Recommendations for

Closure and Realignment (GAO/NSIAD-95-133, Apr. 14, 1995).

Aerospace Guidance and Metrology Center: Cost Growth and Other

Factors Affect Closure and Privatization (GAO/NSIAD-95-60, Dec. 9, 1994).

Page 31 GAO/NSIAD-98-175 Defense Depot Maintenance
Related GAO Products

Navy Maintenance: Assessment of the Public and Private Shipyard

Competition Program (GAO/NSIAD-94-184, May 25, 1994).

Depot Maintenance: Issues in Allocating Workload Between the Public and

Private Sectors (GAO/T-NSIAD-94-161, Apr. 12, 1994).

Depot Maintenance (GAO/NSIAD-93-292R, Sept. 30, 1993).

Depot Maintenance: Issues in Management and Restructuring to Support a

Downsized Military (GAO/T-NSIAD-93-13, May 6, 1993).

Air Logistics Center Indicators (GAO/NSIAD-93-146R, Feb. 25, 1993).

Defense Force Management: Challenges Facing DOD as It Continues to

Downsize Its Civilian Workforce (GAO/NSIAD-93-123, Feb. 12, 1993).

(709319) Page 32 GAO/NSIAD-98-175 Defense Depot Maintenance
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