**GAO-04-871**                      Published: Sep 29, 2004. Publicly Released: Sep 29, 2004.                  

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## Highlights

Under 10 U.S.C. 2466, the military departments and defense agencies can use no more than 50 percent of annual depot maintenance funding for work performed by private-sector contractors. DOD also must submit two reports to the Congress annually on the division of depot maintenance funding between the public and private sectors--one about the percentage of funds spent in the previous 2 fiscal years (prior-years report) and one about the current and 4 succeeding fiscal years (future-years report). As required, GAO reviewed the two DOD reports submitted in early 2004 and is, with this report, submitting its views to the Congress on whether (1) the military services met the so-called "50-50 requirement" for fiscal years 2002-3 and (2) the projections for fiscal years 2004-8 are reasonable estimates. GAO also identified key limitations in the 50-50 process that affect the department's ability to comply with the 50-50 requirement.

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## Topics

National Defense

Data collectionData integrityDefense budgetsDefense procurementDepartment of Defense contractorsFinancial analysisFinancial management systemsFinancial recordsFuture budget projectionsMaintenance costsMaintenance services contractsPrivate sectorReporting requirements