United States General Accounting Office

GAO Report to Congressional Requesters

September 1993 1994 DEFENSE

BUDGET

Potential Reductions to

Ammunition Programs

GAO/NSIAD-93-296

GAO United States

General Accounting Office

Washington, D.C. 20548

National Security and

International Affairs Division

B-216058 

September 20, 1993

The Honorable Daniel K. Inouye

Chairman, Subcommittee on Defense

Committee on Appropriations

United States Senate

The Honorable John P. Murtha

Chairman, Subcommittee on Defense

Committee on Appropriations

House of Representatives

As you requested, we reviewed the military services’ justifications for their fiscal year 1994

budget requests for ammunition items and the Army’s request for ammunition production base

support. In addition, we examined selected segments of prior-year ammunition programs. In

June 1993, we briefed your staffs on the results of our review. This report includes the

information provided at those briefings and the final results of our review.

We are sending copies of this report to the Chairmen and Ranking Minority Members of the

Senate and House Committees on Armed Services and on Appropriations; the Secretaries of

Defense, the Army, the Navy, and the Air Force; the Commandant of the Marine Corps; and

other interested parties. We will also make copies available to others upon request.

This report was prepared under the direction of Louis J. Rodrigues, Director, Systems

Development and Production Issues, who may be reached on (202) 512-4841 if you or your staff

have any questions. Major contributors to this report are listed in appendix I.

Frank C. Conahan

Assistant Comptroller General
Executive Summary

Purpose The Chairmen of the Subcommittees on Defense, Senate and House

Committees on Appropriations, asked GAO to review the military services’

justifications for their fiscal year 1994 budget requests for ammunition and

the Army’s request for ammunition production base support to determine

whether the programs should be funded in the amounts requested. GAO

also reviewed selected segments of appropriations for prior years for some

items to determine whether unused funds could be rescinded or used to

reduce the fiscal year 1994 request.

Background As shown in table 1, the military services requested about $1.3 billion for

ammunition and ammunition production base support in fiscal year 1994.

Table 1: Military Services’ Fiscal Year

1994 Budget Requests for Ammunition

and for Ammunition Production Base

Support

Dollars in millions

Service Amount

Army

Ammunition $527.2

Production base support 207.2

Navy 277.1

Air Force 239.3

Marine Corps 85.1

Total $1,335.9

The services justified their ammunition requests by stating that the

ammunition was needed for training and a war reserve stockpile. The

Army justified its request for production base support by stating that the

funds were needed to modernize and expand the ammunition production

base, to lay away production facilities no longer required for active

production and maintain inactive facilities being retained for possible

future production, to provide components for use in demonstrating

production capacities, and to destroy excess and obsolete conventional

ammunition.

Results in Brief GAO concluded that most items in the services’ $1.129 billion fiscal year

1994 request for ammunition and the Army’s $207.2 million request for

production base support are justified. However, as shown in table 2, GAO

believes $197.9 million, or 14.8 percent, of the fiscal year 1994 request is

not justified and should not be funded. Further, $63.9 million from the

services’ fiscal year 1993 appropriations and $55.2 million from the

Page 2 GAO/NSIAD-93-296 1994 Defense Ammunition Budget
Executive Summary

services’ fiscal year 1992 appropriations are no longer needed for the

ammunition items for which the funds were appropriated. These

prior-year funds could be rescinded or used to reduce the fiscal year 1994

budget. Table 2 identifies the potential reductions and rescissions to the

military services’ ammunition programs for fiscal year 1994 and prior

years.

Table 2: Potential Reductions and

Rescissions to the Services’

Ammunition Programs Fiscal year

Dollars in millions

Service 1994 1993 1992 Total

Army

Ammunition $114.7 $50.6 $30.2 $195.5

Production base support 3.5 0 0 3.5

Navy 57.9 0 0 57.9

Air Force 21.5 6.8 14.7 43.0

Marine Corps 0.3 6.5 10.3 17.1

Total $197.9 $63.9 $55.2 $317.0

In addition, the Air Force might not need the $26.5 million it requested for

fiscal year 1994 for 30-mm training cartridges. Although GAO did not

identify any specific budget reduction for this item, GAO has included

information on the item because the Committees on Appropriations

should be aware of the issue when considering the Air Force’s budget

request.

Principal Findings

Army Ammunition and

Ammunition Production

Base Support Programs

The Army’s $527.2 million fiscal year 1994 request for ammunition and

$207.2 million fiscal year 1994 request for production base support could

be reduced by $118.2 million for the following reasons:

• $77.7 million is requested for 155-mm Sense and Destroy Armor projectiles

that will not be approved for production and troop use in fiscal year 1994,

• $37 million is requested for seven ammunition items for which program

quantities are greater than needed in fiscal year 1994, and

• $3.5 million is requested for three production base support layaway

projects for which funding will not be needed in fiscal year 1994.

Page 3 GAO/NSIAD-93-296 1994 Defense Ammunition Budget
Executive Summary

In addition, $50.6 million of the Army’s fiscal year 1993 appropriation for

ammunition for three items and $30.2 million of the Army’s fiscal year 1992

appropriation for two items are not needed because the Army has an

adequate inventory of the items for which the funds were provided.

Navy Ammunition Program The Navy’s $277.1 million fiscal year 1994 request for ammunition could be

reduced by $57.9 million for 11 items for which program quantities are

greater than needed.

Air Force Ammunition

Program

The Air Force’s $239.3 million fiscal year 1994 request for ammunition

could be reduced by $21.5 million for three items for which program

quantities are greater than needed. The Air Force reduced the buying

levels for many items due to decreased requirements brought about by a

diminished worldwide threat and the resulting decrease in force structure.

In addition, the Air Force might not need the $26.5 million it requested for

about 3.4 million 30-mm training cartridges in fiscal year 1994. Although

the Air Force has more than an adequate inventory of 30-mm training

cartridges to meet its fiscal year 1994 training needs, about 9 million

rounds in its inventory produced in prior years cannot be released for use

until they have been tested to determine whether they meet the Air Force’s

specifications. Therefore, the Air Force’s need for fiscal year 1994 funding

for this item is contingent upon the results of the tests.

Further, $6.764 million of the Air Force’s fiscal year 1993 appropriation for

ammunition for three items and $14.72 million of the Air Force’s fiscal year

1992 appropriation for four items could be rescinded or used to reduce the

fiscal year 1994 request because the Air Force did not indicate a specific

need for these funds for the items for which the funds were provided.

Marine Corps Ammunition

Program

The Marine Corps’ $85.1 million fiscal year 1994 request for ammunition

could be reduced by $0.3 million because program quantities for two items

are greater than needed in fiscal year 1994.

In addition, $6.5 million of the Marine Corps’ fiscal year 1993 appropriation

for ammunition for four items and $10.3 million of the Marine Corps’ fiscal

year 1992 appropriation for ammunition for three items are not needed.

The Marine Corps does not need to procure the items for which the funds

Page 4 GAO/NSIAD-93-296 1994 Defense Ammunition Budget
Executive Summary

were provided because the Marine Corps has an adequate inventory of the

items.

Recommendations GAO recommends that the Senate and House Committees on

Appropriations reduce the Department of Defense’s fiscal year 1994

ammunition budget by the following amounts:

• $114.7 million for 8 items in the Army’s ammunition request,

• $3.5 million in the Army’s production base support request,

• $57.9 million for 11 items in the Navy’s request,

• $21.5 million for 3 items in the Air Force’s request, and

• $0.3 million for 2 items in the Marine Corps’ request.

In addition, GAO recommends that the following amounts that were

included in the Department of Defense’s fiscal years’ 1993 and 1992

ammunition appropriations be rescinded or used to reduce the

Department of Defense’s fiscal year 1994 request:

• $50.6 million from the Army’s fiscal year 1993 appropriation for three

items,

• $30.2 million from the Army’s fiscal year 1992 appropriation for two items,

• $6.8 million from the Air Force’s fiscal year 1993 appropriation for three

items,

• $14.7 million from the Air Force’s fiscal year 1992 appropriation for four

items,

• $6.5 million from the Marine Corps’ fiscal year 1993 appropriation for four

items, and

• $10.3 million from the Marine Corps’ fiscal year 1992 appropriation for

three items.

Agency Comments As requested, GAO did not obtain fully coordinated Department of Defense

comments on this report. However, GAO discussed the results of its work

with officials from the Office of the Secretary of Defense, the Army

Materiel Command’s Office of the Deputy Chief of Staff for Ammunition,

the Office of the Deputy Chief of Naval Operations for Logistics, the Air

Force’s Office of the Deputy Chief of Staff for Logistics, and the Marine

Corps’ Office of Program Manager for Ammunition. They agreed with

some, but not all, of GAO’s recommended reductions and GAO has included

their views in the report where appropriate. In addition, Army and Navy

officials identified items for which they believed additional funding was

Page 5 GAO/NSIAD-93-296 1994 Defense Ammunition Budget
Executive Summary

needed in fiscal year 1994 but for which funds had not been requested. GAO

included in its report, but did not evaluate, the potential funding increases

identified by these officials.

Page 6 GAO/NSIAD-93-296 1994 Defense Ammunition Budget
Page 7 GAO/NSIAD-93-296 1994 Defense Ammunition Budget
Contents

Executive Summary 2

Chapter 1 

Introduction

10

Objectives, Scope, and Methodology 10

Chapter 2 

Army Ammunition

Program

12

One Item Not Ready for Production 12

Inventory Will Exceed Needs 13

Ammunition Production Base Support 15

Unobligated Prior-Year Appropriations 16

Army’s Proposed Budget Increases 16

Conclusions 17

Recommendations 18

Chapter 3 

Navy Ammunition

Program

19

Overestimated Training Needs 19

Navy’s Proposed Budget Increases 22

Conclusion 23

Recommendation 23

Chapter 4 

Air Force Ammunition

Program

24

Overestimated Training Needs 24

Inventory Will Exceed Needs 25

One Item Might Not Be Needed 26

Unobligated Prior-Year Appropriations 26

Conclusions 27

Recommendations 27

Chapter 5 

Marine Corps

Ammunition Program

28

Inventory Will Exceed Needs 28

Unobligated Prior-Year Appropriations 29

Conclusions 29

Recommendations 30

Appendix Appendix I: Major Contributors to This Report 32

Tables Table 1: Military Services’ Fiscal Year 1994 Budget Requests for

Ammunition and for Ammunition Production Base Support

2

Page 8 GAO/NSIAD-93-296 1994 Defense Ammunition Budget
Contents

Table 2: Potential Reductions and Rescissions to the Services’

Ammunition Programs

3

Table 1.1: Military Services’ Fiscal Year 1994 Budget Requests for

Ammunition and for Ammunition Production Base Support

10

Table 2.1: Potential Reductions to the Army’s Fiscal Year 1994

Ammunition Budget Request

12

Table 2.2: Amount of Inventory Exceeding Needs for Seven Items

in the Army’s Fiscal Year 1994 Ammunition Budget

14

Table 2.3: Potential Reductions to the Army’s Fiscal Year 1994

Ammunition Budget Request for Layaway Projects

15

Table 2.4: Unobligated Amounts from the Army’s Fiscal Years

1993 and 1992 Appropriations

16

Table 2.5: Army’s Proposed Budget Increases 17

Table 3.1: Potential Reductions to the Navy’s Fiscal Year 1994

Ammunition Budget Request

19

Table 3.2: Actual Training Consumptions as a Percentage of

Projections for Fiscal Years 1990 Through 1992

20

Table 3.3: Navy’s Proposed Budget Increases 23

Table 4.1: Potential Reductions to the Air Force’s Fiscal Year

1994 Ammunition Budget Request

24

Table 4.2: Unobligated Amounts from the Air Force’s Fiscal Years

1993 and 1992 Appropriations

26

Table 5.1: Amount of Inventory Exceeding Needs for Two Items

in the Marine Corps’ Fiscal Year 1994 Ammunition Budget

28

Table 5.2: Unobligated Amounts from the Marine Corps’ Fiscal

Years 1993 and 1992 Appropriations

29

Figure Figure 3.1: Projected and Actual Consumption for the 76-mm

BL&P Cartridge, Fiscal Years 1987 to 1992

22

Abbreviations

BL&P blind, load, and plug

GAO General Accounting Office

SADARM Sense and Destroy Armor munition

Page 9 GAO/NSIAD-93-296 1994 Defense Ammunition Budget
Chapter 1 

Introduction

As shown in table 1.1, the military services requested about $1.3 billion for

ammunition and ammunition production base support in fiscal year 1994.

Table 1.1: Military Services’ Fiscal Year

1994 Budget Requests for Ammunition

and for Ammunition Production Base

Support

Dollars in millions

Military service Amount

Army $734.4

Navy 277.1

Air Force 239.3

Marine Corps 85.1

Total $1,335.9

The services indicated that the requested funds for ammunition would be

used to meet training needs and build a war reserve stockpile. The Army

stated that the requested funds for ammunition production base support

would be used to modernize and expand the ammunition production base,

to lay away production facilities no longer required for active production

and maintain inactive facilities being retained for possible future

production, to provide components for use in demonstrating production

capacities, and to destroy excess and obsolete conventional ammunition.

Objectives, Scope,

and Methodology

The Chairmen of the Subcommittees on Defense, Senate and House

Committees on Appropriations, asked us to review the military services’

justifications for their fiscal year 1994 budget requests for ammunition and

the Army’s request for ammunition production base support to determine

whether the programs should be funded in the amounts requested. We also

reviewed the services’ use of prior years’ appropriations for the

procurement of ammunition to determine whether unused funds could be

rescinded or used to reduce the fiscal year 1994 request.

In conducting our review, we evaluated the ammunition and production

base support requests involving large dollar amounts, ammunition items

being bought for the first time, and ammunition items that were having

production and/or performance problems. In reviewing the budget

requests, we considered such factors as ammunition requirements,

inventory levels, item quality, testing and development, funded program

status, unit costs, and field malfunctions to identify items with potential

problems. We also analyzed production schedules, production capacities,

past production, procurement lead times, and component deliveries to

determine whether the services can execute the ammunition programs

efficiently and economically. We compared projected inventory levels to

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Chapter 1 

Introduction

training usage to ensure that inventories would not greatly exceed

objectives. We also determined whether there will be sufficient quantities

of components to produce end items. We did not verify the accuracy of

data the services provided, such as inventory levels and training usage, but

compared such information with data provided in prior years to evaluate

its reasonableness.

To evaluate projects for production base support, we determined whether

their designs had been completed prior to budget submission and whether

the projects were still needed.

In conducting our evaluation, we interviewed ammunition production

managers, procurement officials, and quality assurance and engineering

staff. We also reviewed various documents, such as information papers,

test data analyses, training consumption reports, and budget support data,

which we obtained from the following:

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

• U.S. Army Materiel Command, Alexandria, Virginia;

• U.S. Army Armament, Munitions and Chemical Command, Rock Island,

Illinois;

• U.S. Army Armament Research, Development and Engineering Center,

Dover, New Jersey;

• U.S. Army Production Base Modernization Activity, Dover, New Jersey;

• Project Manager’s Office for Sense and Destroy Armor, Dover, New Jersey;

• Project Manager’s Office for Mortar Systems, Dover, New Jersey;

• Project Manager’s Office for Mines, Dover, New Jersey;

• Marine Corps Systems Command, Washington, D.C.;

• Naval Air Systems Command, Arlington, Virginia; and

• Ogden Air Logistics Center, Ogden, Utah.

We conducted our review from November 1992 to September 1993 in

accordance with generally accepted government auditing standards. We

discussed a draft of this report with officials from the Office of the

Secretary of Defense, the Army Materiel Command’s Office of the Deputy

Chief of Staff for Ammunition, the Navy’s Office of the Deputy Chief of

Naval Operations for Logistics, the Air Force’s Office of the Deputy Chief

of Staff for Logistics, and the Marine Corps’ Office of Program Manager for

Ammunition. We have incorporated their comments in the report, where

appropriate. As requested, we did not obtain fully coordinated Department

of Defense comments on this report.

Page 11 GAO/NSIAD-93-296 1994 Defense Ammunition Budget
Chapter 2 

Army Ammunition Program

The Army requested $527.218 million for ammunition and $207.209 million

for ammunition production base support in its fiscal year 1994 ammunition

budget request.

Our review indicates that the Army does not need $118.188 million in its

fiscal year 1994 ammunition and ammunition production base support

requests—$114.664 million for eight ammunition items and $3.524 million

for ammunition production base support. The items for which we

identified potential reductions and a summary of our basis for the

reductions are identified in table 2.1.

Table 2.1: Potential Reductions to the Army’s Fiscal Year 1994 Ammunition Budget Request

Dollars in millions

Description of item

Amount

requested

Potential

reduction Basis for reduction

155-mm XM898 SADARM artillery projectile $77.661 $77.661 Not ready for production.

7.62-mm M82 cartridge 11.309 7.156 Inventory will exceed needs.

7.62-mm 4-ball/1-tracer cartridge 1.460 1.460 Inventory will exceed needs.

7.62-mm M118 cartridge 1.028 1.028 Inventory will exceed needs.

.45 caliber M1911 cartridge 0.325 0.325 Inventory will exceed needs.

.50 caliber 4-ball/1-tracer cartridge 19.055 1.717 Inventory will exceed needs.

25-mm M910 cartridge 27.451 25.000 Inventory will exceed needs.

.22 caliber match cartridge for rifle 0.317 0.317 Inventory will exceed needs.

Subtotal 138.606 114.664

Layaway of industrial facilities 51.532 3.524 Production lines will operate

through fiscal year 1994.

Total $190.138 $118.188

In addition, $50.593 million of the Army’s fiscal year 1993 appropriation for

ammunition for three items and $30.181 million of the Army’s fiscal year

1992 appropriation for two items are not needed because the Army has an

adequate inventory of the items for which the funds were provided.

One Item Not Ready

for Production

The Army requested $77.661 million for low-rate initial production of 1,213

155-mm Sense and Destroy Armor (SADARM) projectiles in fiscal year 1994.

However, performance and reliability problems have prevented the Army

from obtaining approval for production. Because of this delay, it is

premature to provide the $77.661 million the Army is requesting in fiscal

year 1994.

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Chapter 2 

Army Ammunition Program

In July 1993, the Army suspended performance flight testing of SADARM

because of concerns about the system’s performance and reliability. The

Army has developed a plan to extend the engineering and manufacturing

development phase for approximately 2 years to address the projectile’s

performance problem. Therefore, the Army does not need the

$77.661 million it requested for SADARM production in fiscal year 1994.

Army officials agreed that the $77.661 million fiscal year 1994 request for

low-rate initial production of the SADARM projectile is not needed because

the projectile is not ready for production. However, Army officials stated

that $98.6 million in research, development, test, and evaluation funds will

be needed in fiscal year 1994 because of the extension of the research and

development phase for SADARM. Because this decision was made after we

completed our fieldwork, we did not evaluate the Army’s revised plan.

Inventory Will Exceed

Needs

Ammunition program quantities for which funds are being requested

should be needed and delivered within the fiscal year’s funded delivery

period. The funded delivery period for an ammunition item begins the first

day of the last month of the procurement lead time and ends 12 months

later.1

 For example, if the procurement lead time for an ammunition item

in the fiscal year 1994 budget is 15 months, the funded delivery period

would start on December 1, 1994, and end on November 30, 1995. Since

ammunition programs are funded each year, funding should not be

provided for ammunition items that are not needed or will not be delivered

until after the fiscal year 1994 funded delivery period.

The Army’s fiscal year 1994 request could be reduced by $37.003 million

for seven items because projected inventories will exceed the Army’s

inventory objectives (see table 2.2).

1

Procurement lead time is the sum of administrative and production lead times. Administrative lead

time begins at the start of the fiscal year and represents the time needed to award contracts for

components. Production lead time begins when the component contracts have been awarded and ends

when initial delivery is made for the assembled ammunition item.

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Chapter 2 

Army Ammunition Program

Table 2.2: Amount of Inventory Exceeding Needs for Seven Items in the Army’s Fiscal Year 1994 Ammunition Budget

Quantity in millions

Description of item

Beginning

inventorya

Quantity

requested

Inventory

estimated

usageb

Inventory

objective

Quantity

exceeding

needs

7.62-mm M82 cartridge 155.903 40.633 144.366 26.457 25.713

7.62-mm 4-ball/1-tracer cartridge 11.980 3.024 6.920 1.005 7.079

7.62-mm M118 cartridge 8.285 2.866 3.636 0.011 7.504

.45 caliber M1911 cartridge c 2.284 c c 8.064

.50 caliber 4-ball/1-tracer cartridge 37.372 13.970 42.528 7.555 1.259

25-mm M910 cartridge 7.098 2.007 6.245 1.031 1.829

.22 caliber match cartridge for rifle 10.853 3.791 8.960 0.967 4.717

aFigures include items due in from prior-year programs.

bFigures include estimated usage through the end of the fiscal year 1994 program period.

cData omitted because inventory objective is classified.

7.62-mm M82 Cartridges The Army’s $11.309 million request for 40,633,000 7.62-mm M82 cartridges

could be reduced by $7.156 million because projected inventories will

exceed requirements by 25,713,000 cartridges. Army officials agreed that

the request could be reduced by $6.844 million. However, we believe that a

reduction of $7.156 million is more appropriate because it is based on the

Army’s projected consumption through the fiscal year 1994 program

period, which reflects the Army’s current training requirement for the

cartridge.

7.62-mm 4-Ball/1-Tracer

Cartridges

The Army’s $1.46 million request for 3,024,000 7.62-mm 4-ball/1-tracer

cartridges for overhead fire could be denied because projected inventories

will exceed requirements without the fiscal year 1994 program. Army

officials agreed.

7.62-mm M118 Cartridges The Army’s $1.028 million request for 2,866,000 7.62-mm M118 special ball

cartridges could be denied because projected inventories will exceed

requirements without the fiscal year 1994 program. Army officials agreed.

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Chapter 2 

Army Ammunition Program

.45 Caliber M1911

Cartridges

The Army’s $0.325 million request for 2,284,000 .45 caliber M1911

cartridges could be denied because projected inventories will exceed

requirements without the fiscal year 1994 program. Army officials agreed.

.50 Caliber 4-Ball/1-Tracer

Cartridges

The Army’s $19.055 million request for 13,970,000 .50 caliber 4-ball/1-tracer

cartridges could be reduced by $1.717 million because projected

inventories will exceed requirements by 1,259,000 cartridges. Army

officials agreed.

25-mm M910 Cartridges The Army’s $27.451 million request for 2,007,000 25-mm M910 cartridges

could be reduced by $25 million because projected inventories will exceed

requirements by 1,829,000 cartridges. Army officials agreed.

.22 Caliber Match

Cartridges for Rifles

The Army’s $1.11 million request for items less than $2 million includes

$0.317 million for 3,791,000 .22 caliber match cartridges for rifles. The

$0.317 million request could be denied because projected inventories will

exceed requirements without the fiscal year 1994 program. Army officials

agreed.

Ammunition

Production Base

Support

The Army requested $207.209 million for ammunition production base

support in fiscal year 1994, including $51.532 million to lay away industrial

facilities. We believe that the Army’s $3.524 million request to lay away

industrial facilities at three ammunition plants is not needed because the

facilities are scheduled to operate through the fiscal year 1994 program

period (see table 2.3).

Table 2.3: Potential Reductions to the

Army’s Fiscal Year 1994 Ammunition

Budget Request for Layaway Projects

Dollars in millions

Location

Amount

requested Item produced

Kansas Army Ammunition Plant $2.672 Combined effects munitions

Iowa Army Ammunition Plant 0.536 105-mm HERA cartridges

Milan Army Ammunition Plant 0.316 M936 fuze

Total $3.524

Army officials agreed that fiscal year 1994 funds are not needed for the

three layaway projects but did not agree with the reduction. They said the

funds are needed to lay away production facilities at the Radford Army

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Chapter 2 

Army Ammunition Program

Ammunition Plant. According to Army officials, over 30 percent of the

facilities at the Radford plant have been designated as no longer required

for active production and layaway of these facilities would reduce

production overhead expenses. However, this was not the purpose for

which the funding was requested. In addition, we could not evaluate the

need for fiscal year 1994 layaway funding at the Radford plant because the

Army did not provide project cost and schedule data.

Unobligated

Prior-Year

Appropriations

We have identified $80.774 million in unobligated appropriations for fiscal

years 1993 and 1992 that could be rescinded or used to reduce the Army’s

fiscal year 1994 request because the Army does not need to procure the

items for which the funds were provided.

As of September 10, 1993, the Army had not obligated funds totaling

$50.593 million from its fiscal year 1993 ammunition appropriations for

three items and $30.181 million from its fiscal year 1992 appropriations for

two items (see table 2.4).

Table 2.4: Unobligated Amounts From

the Army’s Fiscal Years 1993 and 1992

Appropriations

Unobligated Amount

Item

Fiscal year

1993

Fiscal year

1992 Total

155-mm M203 red bag propelling charge $21.493 $0 $21.493

105-mm M490A1 TP-T tank cartridge 19.000 0 19.000

105-mm M724A1 DS-TP tank cartridge 10.100 0 10.100

M762 electric time artillery fuze 0 22.000 22.000

8-inch M1 green bag propelling charge 0 8.181 8.181

Total $50.593 $30.181 $80.774

Army officials agreed that the Army does not need to procure the items for

which the funds were provided because the Army has an adequate

inventory of the items involved. However, they did not agree that the

unobligated funds should be rescinded. They said that $9.999 million of the

$19 million provided for 105-mm M490A1 TP-T tank cartridges was being

reprogrammed to destroy excess and obsolete conventional ammunition

and that the Army would like to reprogram the remaining $70.775 million

for other higher priority needs.

Army’s Proposed

Budget Increases

At the end of our review, Army officials provided us a list of eight items for

which they believed additional funding of $118.424 million was needed for

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Chapter 2 

Army Ammunition Program

fiscal year 1994. Table 2.5 provides details on the Army’s proposed budget

increases.

We did not review the appropriateness of funding these items because the

Army provided the list after we had completed our fieldwork and because

the Army did not provide sufficient data to support or justify the need for

more funding. The Army has proposed that $25 million be provided for

25-mm M919 cartridges for fiscal year 1994; however, as of June 22, 1993, it

had not obligated $18.3 million of its fiscal year 1991 appropriation for this

cartridge.

Table 2.5: Army’s Proposed Budget

Increases Dollars in millions

Description of item

Proposed

increase

5.56-mm M200 blank cartridges $6.355

5.56-mm M855 ball cartridges linked for SAW 0.740

5.56-mm ball cartridges for M16A2 5.224

7.62-mm 4-ball/1-tracer cartridges for minigun 8.833

7.62-mm M852 cartridges 1.912

.50 caliber blank cartridges with M9 link 10.360

25-mm M919 cartridges 25.000

Volcano AT/AP M87 mine 60.000

Total $118.424

Conclusions We believe that $114.664 million of the Army’s fiscal year 1994 request is

not needed because one item will not be ready for production in fiscal year

1994 and requested program quantities for seven other items are greater

than needed. We also believe that $3.524 million of the Army’s fiscal year

1994 request for production base support is not needed because funding

requests for three layaway projects are premature.

In addition, $50.593 million of the Army’s fiscal year 1993 appropriation for

three items and $30.181 million of the Army’s fiscal year 1992

appropriation for two items are not needed because the Army has an

adequate inventory of the items for which the funds were provided. These

unobligated appropriations from prior years could be rescinded or used to

reduce the Army’s fiscal year 1994 request.

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Chapter 2 

Army Ammunition Program

Recommendations We recommend that the Senate and House Committees on Appropriations

reduce the Army’s fiscal year 1994 budget request by $114.664 million for

eight ammunition items and by $3.524 million for production base support.

We also recommend that $50.593 million from the Army’s fiscal year 1993

appropriation and $30.181 million from the Army’s fiscal year 1992

appropriation be rescinded or used to reduce the Army’s fiscal year 1994

request.

Page 18 GAO/NSIAD-93-296 1994 Defense Ammunition Budget
Chapter 3 

Navy Ammunition Program

The Navy requested $277.1 million for ammunition items in its fiscal year

1994 budget. Our review indicates that the Navy does not need

$57.881 million in fiscal year 1994 because the Navy overestimated its

training needs for 11 ammunition items (see table 3.1).

Table 3.1: Potential Reductions to the

Navy’s Fiscal Year 1994 Ammunition

Budget Request

Dollars in millions

Description of item Amount requested

Potential

reduction

5-inch/54 gun ammunition

Full propelling charge $23.879 $23.879

VTNF 5.858 5.858

BL&P 5.135 5.135

Practice bombs

BDU-45 NTP 6.026 6.026

BDU-48/B 0.490 0.490

76-mm gun ammunition

VTNF 4.257 4.257

BL&P 1.526 1.526

Air expendable countermeasures

MJU-8A/B flare 4.113 4.113

Machine gun ammunition

20-mm PGU-27 TP 2.790 2.790

20-mm PGU-27 w/14 link 1.712 1.712

Small arms and landing party ammunition

9-mm M882 ball 3.407 2.095

Total $59.193 $57.881

Overestimated

Training Needs

The Navy’s $59.193 million fiscal year 1994 request for 11 ammunition

items could be reduced by $57.881 million because the Navy has

overestimated its training needs. Table 3.2 shows actual training

consumptions as a percent of the Navy’s projections for fiscal years 1990

through 1992. (We are presenting the data as percentages because

quantities are classified.)

Page 19 GAO/NSIAD-93-296 1994 Defense Ammunition Budget
Chapter 3 

Navy Ammunition Program

Table 3.2: Actual Training

Consumptions as a Percentage of

Projections for Fiscal Years 1990

Through 1992 Item

Actual historical usage as

a percentage of projected

usage

5-inch/54 full propelling charge 39

5-inch/54 VTNF 33

5-inch/54 BL&P 50

BDU-45 NTP 57

BDU-48/B 32

76-mm VTNF 4

76-mm BL&P 52

MJU-8A/B flare 12

20-mm PGU-27 TP 42

20-mm PGU-27 w/14 link 75

9-mm M882 ball 13

Source: GAO analysis of Navy data.

Given the Navy’s past consumption patterns, we believe that the Navy’s

fiscal year 1994 projected usage for the 11 items is overstated. On the basis

of the highest or average annual usage during fiscal years 1990 through

1992, we believe that the Navy’s $59.193 million request for the 11 items

could be reduced by $57.881 million.

Navy officials agreed with reductions of $16.442 million requested for five

items: $7.8 million of $23.879 million requested for 5-inch/54 gun full

propelling charges, the $6.026 million requested for BDU-45 NTP practice

bombs, the $0.49 million for BDU-48/B practice bombs, the $1.526 million

requested for 76-mm blind, load and plug (BL&P) gun ammunition, and

$0.6 million of $3.407 million requested for 9-mm M882 ball cartridges.

However, they said that they disagreed with the other reductions for the

following reasons:

• The Navy placed a moratorium on the use of 5-inch/54 gun ammunition for

training because of inventory shortages. Fiscal year 1994 funds are needed

to bring inventories to acceptable levels.

• Low usage of the 76-mm VTNF ammunition was due to low inventory

levels and the fleet’s unfamiliarity with the cartridge. Usage is expected to

increase in the future.

• We should consider projections of expenditures for the improved MJU-8B

flare in our calculations.

Page 20 GAO/NSIAD-93-296 1994 Defense Ammunition Budget
Chapter 3 

Navy Ammunition Program

• Training expenditures for machine gun ammunition were constrained by

the unavailability of assets in prior years and will increase in the future.

• The Navy projects high expenditure rates for the 9-mm ball cartridge

because it replaces the .45 caliber cartridge. Also, the fleet must train to

qualify for the 9-mm weapon.

We believe that the data the Navy provided to us does not support the

Navy’s position. Our analysis of assets and expenditures for fiscal years

1990 through 1992 shows that actual expenditures for most of the 11 items

noted in table 3.2 were less than 15 percent of available assets. The Navy’s

projected and actual usage of 76-mm BL&P cartridges during fiscal years

1987 through 1992 illustrates the point. As shown in figure 3.1, the Navy

projected that it would use substantially more of its inventory of 76-mm

BL&P rounds than it actually used. For example, it projected that it would

use 34 percent of available assets of the 76-mm BL&P cartridges in fiscal

year 1992, whereas it actually used only 16 percent that year.

Page 21 GAO/NSIAD-93-296 1994 Defense Ammunition Budget
Chapter 3 

Navy Ammunition Program

Figure 3.1: Projected and Actual

Consumption for the 76-mm BL&P

Cartridge, Fiscal Years 1987 to 1992

Navy’s Proposed

Budget Increases

Navy officials provided us a list of items for which they believed additional

funding is needed in fiscal year 1994 but for which funds had not been

requested (see table 3.3). We did not review the appropriateness of

funding these items because the Navy did not provide sufficient data to

support or justify the need for more funding. However, the list includes

two items (76-mm BL&P cartridge and PGU-27 TP cartridge) for which we

have recommended reductions in the fiscal year 1994 program.

Page 22 GAO/NSIAD-93-296 1994 Defense Ammunition Budget
Chapter 3 

Navy Ammunition Program

Table 3.3: Navy’s Proposed Budget

Increases Dollars in millions

Item

Proposed

quantity

Increased

amount

GBU-24 166 $13.136

2.75-inch rocket illuminating warhead 45,543 39.437

25-mm PGU-25/32 HEI cartridge 74,887 0.142

RR-144 ABN chaff 140,300 0.498

20-mm PGU-27 TP cartridge 493,700 1.940

RR-184 BOL chaff 1,048 2.902

5-inch/54 HE CVT projectile 18,300 11.845

GEN X decoy 7,300 40.851

SM875 200,000 1.920

76-mm HE-IR cartridge 11,800 11.733

76-mm BL&P cartridge 4,100 1.227

CCU-41/B chaff 148,000 0.230

MJU-7 flare 4,366 0.114

.50 caliber MK211 cartridge 1,016,400 1.616

25-mm PGU-32 HEI-T cartridge 137,200 2.241

RR-188 chaff 5,527 0.003

JATO MK6 422 2.583

BBU-36 flare 6,400 0.008

Total $132.426

Conclusion We believe that $57.881 million of the Navy’s fiscal year 1994 request is not

needed because requested program quantities for 11 ammunition items are

greater than needed.

Recommendation We recommend that the Senate and House Committees on Appropriations

reduce the Navy’s fiscal year 1994 ammunition budget request by

$57.881 million.

Page 23 GAO/NSIAD-93-296 1994 Defense Ammunition Budget
Chapter 4 

Air Force Ammunition Program

The Air Force requested $239.3 million for ammunition items in its fiscal

year 1994 budget. Our review indicates that the Air Force does not need

$21.462 million in fiscal year 1994 for three items. Table 4.1 shows the

items for which we have identified potential reductions and a summary of

our basis for the reductions.

Table 4.1: Potential Reductions to the

Air Force’s Fiscal Year 1994

Ammunition Budget Request

Dollars in millions

Description of item

Amount

requested

Potential

reduction Basis for reduction

MK-82 inert/BDU-50 bomb $6.318 $6.318 Overstated training consumption

25 pound practice bomb 7.405 1.821 Overstated training consumption

M-206 cartridge flare 13.323 13.323 Inventory will exceed needs

Total $27.046 $21.462

In addition, the Air Force might not need the $26.464 million it requested

for about 3.4 million 30-mm training cartridges in fiscal year 1994 because

the Air Force might have an adequate supply of 30-mm training cartridges

in its inventory without a fiscal year 1994 buy. Although we did not

identify any specific budget reductions for this item, we have included

information on it because the Committees on Appropriations should be

aware of the issue when considering the Air Force’s budget request.

Further, we believe that $6.764 million of the Air Force’s fiscal year 1993

appropriation for ammunition for three items and $14.72 million of the Air

Force’s fiscal year 1992 appropriation for four items could be rescinded or

used to reduce the fiscal year 1994 request because the Air Force did not

indicate a specific need for these funds for the items for which the funds

were provided.

Overestimated

Training Needs

The Air Force’s $13.723 million request for two items could be reduced by

$8.139 million because the Air Force overestimated its training needs for

these items.

MK-82 Inert/BDU-50 Bomb The Air Force’s $6.318 million request for 24,936 MK-82 inert/BDU-50

bombs could be denied because the Air Force overestimated its training

needs. The Air Force used a 32-month procurement lead time that it could

not justify. The Army procures this item for the Air Force and, according

to Army records, the correct procurement lead time is 24 months. Thus, in

projecting its inventory position at the end of the fiscal year 1994 program

Page 24 GAO/NSIAD-93-296 1994 Defense Ammunition Budget
Chapter 4 

Air Force Ammunition Program

period, the Air Force included in its calculations 8 months of additional

training expenditures totaling 29,331 bombs. Air Force officials said that

the Army reduced the procurement lead time to 24 months after the Air

Force had submitted its budget request and agreed with the $6.318 million

reduction.

25 Pound BDU-33 Bomb The Air Force’s $7.405 million request for 715,704 25 pound practice

bombs could be reduced by $1.821 million for 176,087 bombs because the

Air Force overestimated its training expenditures. The Air Force projected

average annual usage of about 1.06 million rounds through the end of the

fiscal year 1994 funded delivery period; whereas, actual usage for fiscal

years 1990-92 averaged 969,991 annually. Based on actual usage, we

estimate that the Air Force overestimated its training requirements for

fiscal year 1994 by 176,087 rounds, or $1.821 million. Air Force officials

initially agreed but subsequently disagreed that their training requirements

were overestimated. We believe, however, that based on past consumption

patterns, the Air Force overestimated its training needs and that the Air

Force’s fiscal year 1994 request could be reduced by $1.821 million.

Inventory Will Exceed

Needs

The Air Force’s $13.323 million request for 659,370 M-206 cartridge flares

could be denied because projected inventories will exceed the Air Force’s

inventory objectives without the fiscal year 1994 program.

Air Force officials disagreed, stating that this item has a 7-year shelf life,

which has expired for all but 666,844 of the 4,628,138 million M-206 flares

in inventory as of March 30, 1993. They said that the remaining inventory

of 3,961,294 M-206 flares with an expired shelf life can be used only for

training. Air Force officials also said that requirements for these flares are

expected to increase significantly in the foreseeable future due to

operations in Bosnia.

We continue to believe, however, that the request could be denied for

several reasons: (1) according to Air Force records, the 3,961,294 flares in

its inventory are serviceable; (2) the Air Force has not provided supporting

documents to show the age of the inventory; and (3) according to an Air

Force official, the Air Force has conducted tests of M-206 flares, which

showed that the shelf life could be extended by 2 years.

Page 25 GAO/NSIAD-93-296 1994 Defense Ammunition Budget
Chapter 4 

Air Force Ammunition Program

One Item Might Not

Be Needed

The $26.464 million the Air Force is requesting for 3,373,413 30-mm

training cartridges might not be needed. The Air Force’s need for fiscal

year 1994 funding for this item is contingent upon the results of ongoing

and planned future tests. Although the Air Force has more than an

adequate inventory of 30-mm training cartridges to meet its fiscal year

1994 training needs, about 9 million rounds in its inventory produced in

prior years cannot be released for use until they have been tested to

determine whether they meet the Air Force’s specifications and are usable.

According to an Air Force official, these tests are expected to continue

into July 1994. If the tests should disclose that the rounds meet

specifications and are usable, the Air Force will have an excess supply of

30-mm training cartridges in its inventory and will not need to procure

additional cartridges in fiscal year 1994. However, if the test results should

disclose that they do not meet specifications and are not usable, the Air

Force will need to procure additional 30-mm cartridges in fiscal year 1994

to meet its projected training needs.

Unobligated

Prior-Year

Appropriations

We have identified $21.484 million in unobligated appropriations from

fiscal years 1993 and 1992 that could be rescinded or used to reduce the

Air Force’s fiscal year 1994 request because the Air Force did not identify

a need to use the funds for the purposes for which the funds were

provided.

As of September 10, 1993, the Air Force had not obligated funds totaling

$6.764 million from its fiscal year 1993 ammunition appropriations for

three items and $14.72 million from its fiscal year 1992 appropriations for

four items (see table 4.2).

Table 4.2: Unobligated Amounts From

the Air Force’s Fiscal Years 1993 and

1992 Appropriations Unobligated amount

Dollars in millions

Item

Fiscal year

1993

Fiscal year

1992 Total

Items less than $2 million (other) $2.894 $5.152 $8.046

Spares and repair parts 2.800 3.900 6.700

Items less than $2 million (cartridges) 0 3.768 3.768

FMU-139 fuze 0 1.900 1.900

Items less than $2 million (bombs) 1.070 0 1.070

Total $6.764 $14.720 $21.484

Page 26 GAO/NSIAD-93-296 1994 Defense Ammunition Budget
Chapter 4 

Air Force Ammunition Program

Air Force officials agreed that the $21.484 million is unobligated. Except

for the $1.9 million for the FMU-139 fuze, Air Force officials neither agreed

nor disagreed that the funds could be rescinded or used to reduce the Air

Force’s fiscal year 1994 request. They said that they would like to

reprogram the $1.9 million in unobligated fiscal year 1992 appropriations

for FMU-139 fuzes for the Sensor Fuzed Weapon. However, this was not

the purpose for which the funds were provided. In addition, we requested

but the Air Force did not provide justifications for these unobligated

amounts.

Conclusions We believe that $21.462 million of the Air Force’s fiscal year 1994 request

for three ammunition items is not needed because requested program

quantities are greater than needed. In addition, the Air Force might not

need to procure 30-mm training cartridges in fiscal year 1994. Further,

$6.764 million of the Air Force’s fiscal year 1993 appropriation for

ammunition for three items and $14.72 million of the Air Force’s fiscal year

1992 appropriation for four items could be rescinded or used to reduce the

fiscal year 1994 request because the Air Force did not indicate a need for

these funds for the purposes for which the funds were provided.

Recommendations We recommend that the Senate and House Committees on Appropriations

reduce the Air Force’s fiscal year 1994 ammunition budget request by

$21.462 million. We also recommend that $6.764 million from the Air

Force’s fiscal year 1993 appropriation and $14.72 million from the Air

Force’s fiscal year 1992 appropriation be rescinded or used to reduce the

Air Force’s fiscal year 1994 request.

Page 27 GAO/NSIAD-93-296 1994 Defense Ammunition Budget
Chapter 5 

Marine Corps Ammunition Program

The Marine Corps requested $85.1 million for ammunition items in its

fiscal year 1994 budget. Our review indicates that the Marine Corps does

not need $0.344 million because the projected inventory for two items will

exceed requirements.

In addition, $6.508 million of the Marine Corps’ fiscal year 1993

appropriation for ammunition for four items and $10.285 million of the

Marine Corps’ fiscal year 1992 appropriation for ammunition for three

items are not needed because the Marine Corps has an adequate inventory

of the items for which the funds were provided.

Inventory Will Exceed

Needs

The Marine Corps’ $0.669 million fiscal year 1994 request for two items

could be reduced by $0.344 million because projected inventories will

exceed the Marine Corps’ inventory objectives (see table 5.1).

Table 5.1: Amount of Inventory

Exceeding Needs for Two Items in the

Marine Corps’ Fiscal Year 1994

Ammunition Budget Description of item

Beginning

inventorya

Quantity

requested

Inventory

estimated

usageb

Inventory

objective

Quantity

exceeding

needs

M68A2 trailer mounted,

practice line charges 1,660 25 1,134 306 245

9-mm practice

cartridges 2,024,131 723,545 1,080,696 1,358,407 308,573

aFigures include items due in from prior-year programs.

bFigures include estimated usage through the end of the fiscal year 1994 program period.

M68A2 Practice Line

Charge

The Marine Corps’ $0.229 million request for 25 M68A2 trailer mounted,

practice line charges could be denied because projected inventories will

exceed requirements without the fiscal year 1994 program. Marine Corps

officials declined to challenge our excessive inventory projections and did

not agree or disagree with the potential reduction.

9-mm Practice Cartridge The Marine Corps’ $0.27 million request for 723,545 9-mm practice

cartridges could be reduced by $0.115 million because projected

inventories will exceed requirements by 308,753 cartridges. Marine Corps

officials agreed.

Page 28 GAO/NSIAD-93-296 1994 Defense Ammunition Budget
Chapter 5 

Marine Corps Ammunition Program

Unobligated

Prior-Year

Appropriations

We have identified $16.793 million in unobligated appropriations for fiscal

years 1993 and 1992 that could be rescinded or used to reduce the Marine

Corps’ fiscal year 1994 request because the Marine Corps has an adequate

inventory of the items for which the funds were provided.

As of September 10, 1993, the Marine Corps had not obligated

$6.508 million from its fiscal year 1993 ammunition appropriations for four

items and $10.285 million from its fiscal year 1992 appropriations for three

items (see table 5.2).

Table 5.2: Unobligated Amounts From

the Marine Corps’ Fiscal Years 1993

and 1992 Appropriations Unobligated amounts

Dollars in millions

Description of item

Fiscal year

1993

Fiscal year

1992 Total

AT-4 light anti-armor weapon 0 $7.130 $7.130

Items less than $2 million $3.476 1.144 4.620

7.62-mm linked armor piercing cartridge 0 2.011 2.011

M58A4 trailer mounted line charge 1.231 0 1.231

M18 series green smoke hand grenade 0.910 0 0.910

M18 series yellow smoke hand grenade 0.891 0 0.891

Total $6.508 $10.285 $16.793

Marine Corps officials agreed that the Marine Corps does not need the

funds for the items for which the funds were provided but did not agree

that the funds should be rescinded. They said that the Marine Corps plans

to use the $4.62 million in unobligated appropriations for items less than

$2 million for ammunition modernization and the $12.173 million in

unobligated appropriations for the five other items for 81-mm high

explosive mortar cartridges. However, this is not the purpose for which

the funds were provided.

Conclusions We believe that $0.3 million of the Marine Corps’ fiscal year 1994 request is

not needed because requested program quantities for two items are

greater than needed. In addition, $6.5 million of funds provided to the

Marine Corps in fiscal year 1993 for four items and $10.3 million provided

in fiscal year 1992 for three items are not needed because the Marine

Corps has an adequate inventory of the items for which the funds were

provided.

Page 29 GAO/NSIAD-93-296 1994 Defense Ammunition Budget
Chapter 5 

Marine Corps Ammunition Program

Recommendations We recommend that the Senate and House Committees on Appropriations

reduce the Marine Corps’ fiscal year 1994 budget request by $0.3 million

for two ammunition items. We also recommend that $6.5 million from the

Marine Corps’ fiscal year 1993 appropriation and $10.3 million from its

fiscal year 1992 appropriation be rescinded or used to reduce the Marine

Corps’ fiscal year 1994 request.

Page 30 GAO/NSIAD-93-296 1994 Defense Ammunition Budget
Page 31 GAO/NSIAD-93-296 1994 Defense Ammunition Budget
Appendix I 

Major Contributors to This Report

National Security and

International Affairs

Division, Washington,

D.C.

Thomas J. Schulz, Associate Director

Raymond Dunham, Assistant Director

Christine D. Frye, Evaluator

Chicago Regional

Office

Antanas N. Sabaliauskas, Evaluator-in-Charge

Robert Wlodarek, Site Senior

Donald Kittler, Evaluator

David A. Bothe, Evaluator

Timothy L. Clouse, Evaluator

New York Regional

Office

Karlton P. Davis, Evaluator

(393541) Page 32 GAO/NSIAD-93-296 1994 Defense Ammunition Budget
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