Page 1 GAO-12-823R Defense Management

United States Government Accountability Office

Washington, DC 20548

September 10, 2012

Congressional Committees

Subject: Defense Management: The Department of Defense’s Annual Corrosion Budget Report 

Does Not Include Some Required Information

In 2012, the Department of Defense (DOD) estimates that corrosion costs the Department about 

$20.9 billion annually. Corrosion can negatively affect all military assets, including both 

equipment and infrastructure, and is defined as the deterioration of a material or its properties 

due to a reaction of that material with its environment.1

Section 2228 of Title 10 of the United States Code requires DOD, as part of its annual budget 

submission, to submit a report to Congress on corrosion funding. In the report, DOD is to 

include (1) funding requirements for its long-term corrosion reduction strategy, (2) the return-oninvestment (ROI) that would be achieved by implementing the strategy, (3) the current and 

previous fiscal year funds requested in the budget compared to funding requirements, (4) an 

explanation if funding requirements are not fully funded in the budget, (5) the amount of funds 

requested for both the current and previous fiscal years in the budget for each project or activity 

described in DOD’s long-term strategy compared to the funding requirements for the project or 

activity, and (6) a copy of the annual corrosion report most recently submitted by the corrosion 

control and prevention executive of each military department as an annex to its report. The 

military departments’ reports are to include recommendations pertaining to the department’s 

corrosion control and prevention program and related funding levels to carry out all of the duties 

of the corrosion control and prevention executive.

Corrosion also affects military readiness 

by taking critical systems out of action and creating safety hazards.

2

Section 2228 also requires us to analyze DOD’s budget submission and report and provide an 

assessment to the congressional defense committees within 60 days after the submission of the 

budget for the fiscal year,3

 

1

10 USC § 2228(f)(1). Corrosion includes such varied forms as rusting; pitting; galvanic reaction; calcium or other 

mineral buildup; degradation due to ultraviolet light exposure; and mold, mildew, or other organic decay.

which this year occurred on February 13, 2012. DOD submitted its 

annual report to Congress on May 21, 2012, and we received the report on May 23, 2012. Our 

objectives were to (1) determine the extent to which DOD’s corrosion report included the 

mandated elements, (2) assess the extent to which DOD’s Corrosion Prevention and Control 

(CPC) funding request met total estimated CPC funding requirements for activities and 

2

Pub. L. No. 110-417, § 903 (2008).

3

Section 2228(e)(2).

 
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preliminary project proposals as identified in the fiscal year 2013 corrosion report, and (3) 

calculate the potential cost avoidance that DOD may achieve by funding CPC at the level 

requested in its fiscal year 2013 corrosion budget materials report and the cost avoidance DOD 

may miss by not fully funding its requirements. Enclosure I provides briefing slides for 

congressional committees detailing the results of our analysis of DOD’s CPC budget request 

and the Office of Corrosion Policy and Oversight’s (CPO) accompanying report for fiscal year

2013.

To conduct this work, we analyzed DOD’s report to determine if it included the mandated 

elements, including the extent to which one of these elements―the military departments’ annual 

corrosion reports―contained recommendations pertaining to the military departments’ CPC 

program and corrosion-related funding levels that are required to carry out all of the duties of the 

corrosion control and prevention executive. Additionally, we analyzed data on DOD’s fiscal year 

2013 CPC funding request and met with officials from the military departments and the 

Corrosion Policy and Oversight office. A more detailed description of our objectives, scope, and 

methodology is provided in enclosure I. We conducted this performance audit from February 

2012 to September 2012 in accordance with generally accepted government auditing standards. 

Those standards require that we plan and perform the audit to obtain sufficient, appropriate 

evidence to provide a reasonable basis for our findings and conclusions based on our audit 

objectives. We believe that the evidence obtained provides a reasonable basis for our findings 

and conclusions based on our audit objectives.

In summary, we found that DOD’s fiscal year 2013 corrosion budget report to Congress (1) 

included some, but not all of the six mandated elements; (2) included a funding request that 

equals DOD’s fiscal year 2013 stated requirements for corrosion activities and projects; and (3) 

lacked information needed to calculate the potential cost avoidance. First, DOD included three 

of the six mandated elements, did not include two of the elements, and one of the elements was 

not applicable this year. For example, DOD included the most recent annual corrosion reports of 

the military departments, attached in an annex. However, it did not include the funds requested 

in the budget compared to the funding requirements for the fiscal year covered by the report or 

the previous fiscal year. Second, DOD officials stated that the fiscal year 2013 budget request 

and the fiscal year 2013 funding requirements for activities and projects are the same this 

year—$9.1 million. According to these officials, DOD does not have any fiscal year 2013 

unfunded requirements for corrosion activities and projects. Third, we did not calculate the cost 

avoidance DOD could achieve with its fiscal year 2013 budget request, because the analysis 

that DOD provided does not support the 14 to1 average ROI for projects cited in its report. 

Further, we did not calculate the cost avoidance that DOD might be missing by not funding its 

requirements, because DOD officials said that they do not have any unfunded requirements this 

year. Without all of the required information on DOD’s corrosion prevention and control activities 

and projects, DOD senior leaders and Congress may face challenges in assessing the levels of 

funding needed to effectively prevent and control corrosion.

For additional information on the results of our work, see enclosure I.
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Recommendations for Executive Action

To ensure that Congress has the accurate and comprehensive information it needs to exercise 

its oversight responsibilities, we recommend for fiscal year 2013 and beyond that the Secretary 

of Defense direct the Under Secretary of Defense for Acquisition, Technology and Logistics to 

take the following three actions:

• Provide in the annual corrosion budget report to Congress a more detailed explanation of 

the development of DOD’s funding requirements.

• Include in the annual corrosion budget report to Congress the funds requested in DOD’s 

budget compared to the funding requirements for the fiscal year covered by the report and 

the preceding fiscal year.

• Provide in the annual corrosion budget report to Congress an explanation of DOD’s ROI 

methodology and analysis, including both projected and, to the extent available, validated 

ROIs.

Agency Comments and Our Evaluation

We provided a copy of a draft of this report to DOD for comment. In its written comments, which

are reprinted in enclosure II, DOD did not agree with our three recommendations. 

DOD did not concur with our recommendation to provide in its annual corrosion budget report to 

Congress a more detailed explanation of how it developed its funding requirements. DOD stated 

that the report as submitted provides Congress with all of the information it needs to exercise its 

oversight responsibilities. Section 2228 of Title 10 of the United States Code required us to 

determine the extent to which DOD’s report to Congress included, among other things, funding 

requirements for its long-term corrosion reduction strategy. Our review found that DOD’s report 

to Congress included $9.1 million as its fiscal year 2013 funding requirements. However, the 

supporting analysis DOD provided us did not support the $9.1 million funding requirements. In 

addition, DOD’s comments make reference to its corrosion strategic plan and process for 

executing projects and activities. Specifically, DOD cites a 2010 GAO report noting that DOD 

had established a rigorous process to select corrosion prevention projects.4

DOD did not concur with our recommendation to provide in its annual corrosion budget report to 

Congress the funds requested in the budget compared to the funding requirements for the fiscal 

year covered by the report and the preceding fiscal year. Our recommendation is consistent with 

Section 2228(e)(1)(c) of Title 10 U.S.C., which requires DOD to include in its annual report the 

funds requested in the budget compared to the funding requirements for the fiscal year covered 

by the report and the preceding fiscal year. In its comments, DOD stated that the funds 

Our 

recommendation focused on DOD’s explanation of how it developed its corrosion budget 

funding requirements and not DOD’s process for the selection or execution of its corrosion 

projects and activities. Therefore, we continue to believe that DOD should provide in its annual 

corrosion budget report a more detailed explanation of the development of its funding 

requirements for fiscal year 2013 and beyond. Without details on the methodology, Congress 

lacks key information about whether DOD’s funding of the CPC program can address the 

current and future costs of corrosion prevention and control.

 

4

GAO, Defense Management: DOD Has a Rigorous Process to Select Corrosion Prevention Projects But Would 

Benefit from Clearer Guidance and Validation of Returns on Investments, GAO-11-84 (Washington, 

D.C.: Dec. 8, 2010).
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requested in the budget are equal to the funding requirement and that the funds requested in 

the budget reflect the required corrosion program funding considering overall DOD needs. 

However, we found that DOD’s report to Congress did not include the funding requirements 

compared to the funding request for either the fiscal year covered by the report (fiscal year 

2013) or the preceding fiscal year (fiscal year 2012). Instead, DOD reported the actual funding it 

received for CPC compared to the funding request, and only for the preceding fiscal year. 

During our review, DOD officials stated that the data for fiscal year 2013 are not included 

because, in keeping with the decision to report actual funding, DOD did not know what its 

funding for fiscal year 2013 would be at the time it submitted its report. In the fiscal year 2013 

corrosion budget report, DOD did not provide the funding requirements for fiscal year 2012, but 

instead reported its actual funding compared to the funding request. During our review, DOD 

officials stated that the decision to report actual funding as opposed to the funding requirements 

for fiscal year 2012 was a senior leadership decision. We continue to believe that DOD should 

include this mandated information in its future annual corrosion budget reports. Without all the 

required information, DOD senior leaders and Congress may face challenges in assessing the 

levels of funding needed to effectively prevent and control corrosion.

DOD did not concur with our recommendation to provide in its annual corrosion budget report to 

Congress an explanation of DOD’s ROI methodology and ROI analysis, including both projected 

and, to the extent possible, validated ROIs. DOD’s comments referenced the methodology 

included in the DOD Corrosion Prevention and Mitigation Strategic Plan, which the military 

departments use to estimate the projected ROI of each project. As we acknowledge in this

report, this methodology is clear and meets the guidance established by the Office of 

Management and Budget. However, DOD performs an additional analysis to determine the 

projected average ROI for projects that it cites in its corrosion budget report to Congress. Our 

recommendation is directed at this additional analysis and the methodology that supports the 

calculated ROI figure included in DOD’s report to Congress. During our review, CPO officials 

stated that the office performed an analysis and determined that the average ROI for projects 

was in excess of 14 to 1. Further, they stated that the analysis contained some validated ROIs. 

However, the ROI analysis DOD provided only contains the projected ROIs and does not 

contain the more up-to-date validated ROIs. Therefore, we cannot confirm whether this ROI is 

accurate or whether validated ROIs were included. In addition, DOD’s comments cite GAO 

statements from our review of last year’s (fiscal year 2012) corrosion budget report, where we 

state that we assessed the data to be sufficiently reliable.5 We performed the same assessment 

this year but came to the opposite conclusion because of the findings above. We continue to 

believe that more information on the analysis and methodology that support the ROI for projects 

cited in DOD’s annual report would help assure Congress that those numbers are based on the 

most up-to-date and accurate information.

 

5

GAO, Defense Management: The Department of Defense’s Fiscal Year 2012 Corrosion Prevention and Control 

Budget Request, GAO-11-490R (Washington, D.C.: Apr. 13, 2011). 
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We are sending copies of this report to the appropriate congressional committees. We are also 

sending copies to the Secretary of Defense; the Deputy Secretary of Defense; the Under 

Secretary of Defense for Acquisition, Technology and Logistics; the Secretaries of the Army, 

Navy, and Air Force; and the Commandant of the Marine Corps. The report also is available at 

no charge on the GAO website at http://www.gao.gov. 

Should you or your staff have questions concerning this report, please contact me on (202) 512-

5257 or merrittz@gao.gov. Contact points for our Offices of Congressional Relations and Public 

Affairs may be found on the last page of this report. GAO staff who made key contributions to 

this report are Carleen Bennett, Assistant Director; Mark Dowling; Dawn Godfrey; Joanne 

Landesman; Charles Perdue; Carol Petersen; Matthew Spiers; Amie Steele; and John Van 

Schaik.

Zina D. Merritt

Director

Defense Capabilities and Management

Enclosures - 2 
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List of Committees

The Honorable Carl Levin

Chairman

The Honorable John McCain

Ranking Member

Committee on Armed Services

United States Senate

The Honorable Daniel K. Inouye

Chairman

The Honorable Thad Cochran

Ranking Member

Subcommittee on Defense

Committee on Appropriations

United States Senate

The Honorable Howard P. “Buck” McKeon

Chairman

The Honorable Adam Smith

Ranking Member

Committee on Armed Services

House of Representatives

The Honorable C.W. “Bill” Young

Chairman

The Honorable Norman D. Dicks

Ranking Member

Subcommittee on Defense

Committee on Appropriations

House of Representatives
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Enclosure I: Briefing for Congressional Committees

Defense Management: The Department of Defense’s 

Annual Corrosion Budget Report Does Not Include Some 

Required Information

Page 1

Briefing for Congressional Committees
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Table of Contents

• Background

• Objectives

• Scope and Methodology

• Summary

• Objective 1: Extent Report Included Mandated Elements

• Objective 2: Extent Funding Request Meets Requirements

• Objective 3: Potential Cost Avoidance

• Conclusions

• Recommendations for Executive Action

• Related GAO Products

Page 2
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Background

• Defense system maintenance involves the sustainment of about 300 ships, 15,000 aircraft, 900 

strategic missiles and 350,000 ground combat and tactical vehicles and costs about $52 billion 

each year.1 In 2012, the Department of Defense (DOD) estimates that corrosion-related 

maintenance accounts for about $20.9 billion a year.

• Corrosion affects all military assets and is defined as the unintended destruction or deterioration 

of material due to interaction with the environment. Corrosion takes such varied forms as rusting; 

pitting; galvanic reaction; calcium or other mineral buildup; degradation due to ultraviolet light 

exposure; and mold, mildew, or other organic decay.

• In addition, corrosion can have negative effects on military equipment and infrastructure in terms 

of readiness and safety. GAO has previously reported that corrosion negatively affects military 

readiness by taking critical systems out of action. It has also impacted safety, resulting in fatal 

accidents due to the degradation of equipment.2

1 Department of Defense, Department of Defense Corrosion Prevention and Control Strategic Plan (Washington, D.C.: 2011).

2 GAO, Defense Management: High-Level Leadership Commitment and Actions Are Needed to Address Corrosion Issues, GAO-07-618 (Washington, D.C.: Apr. 30, 

2007).

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Background (cont.)

DOD began targeting funding toward Corrosion Prevention and Control (CPC) in fiscal year (FY) 

2006, when it established a separate program funding element for Research, Development, Test and 

Evaluation and a separate corrosion line item within an existing program element for Operation and 

Maintenance. CPO manages this program element and line item. According to DOD’s report to 

Congress, part of this funding goes toward DOD-wide CPC activities, while the rest of the funding 

goes toward technology demonstration projects proposed by the military departments.

• DOD’s CPC activities include such things as conducting cost of corrosion studies and 

operating DOD’s corrosion website. CPO identifies these as “required activities” that are 

essential to the success and institutionalization of the corrosion program within DOD. 

• The projects are military department technology demonstration projects for both weapon 

systems and infrastructure that meet CPO’s criteria for funding. The projects are jointly 

funded by CPO and the military departments. CPO typically limits its funding contribution to 

a maximum of $500,000 per project. 

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Background (cont.)

• The military departments submit 

• Preliminary project proposals in the fall and

• Actual project proposals in the spring for CPO’s funding approval.

• Projects that meet CPO’s criteria for funding are announced at the end of the fiscal year. Figure 1 

describes the process in detail. 

Page 6

Figure 1: Project Timeline
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Background (cont.)

• As part of the project selection process, CPO requires that an estimated return-on-investment 

(ROI) cost-benefit analysis be submitted for each actual project proposal.

• The estimated ROI is the ratio of the present value of benefits to the present value of the actual 

project proposal’s total cost. The total cost for each project is based on both the funding 

requested from CPO and the funding provided by the military department.

• CPO’s guidance uses a 7 percent annual discount rate to estimate the present value of 

benefits and costs, which adheres to guidance for public investments in the Office of 

Management and Budget’s Circular A-94. According to CPO officials, this is a conservative 

estimate to avoid overstating the project’s eventual ROI.

• Estimated ROIs and savings vary for each actual project proposal submitted by the military 

departments.

• CPO officials informed us that a military department point of contact estimates the ROI that is 

included in the actual project proposals. A senior official within each military department reviews 

the actual project proposal, including the estimated ROI, before the proposal is submitted to CPO.

• DOD is required to include the expected ROI that would be achieved by funding its requirements 

in its annual report to Congress. 

Page 7
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Background (cont.)

• In last year’s report reviewing DOD’s fiscal year 2012 CPC budget request and budget report, we 

recommended that the Secretary of Defense take the following two actions to ensure that 

Congress has the information it needs to exercise its oversight responsibilities:9

• Direct the Under Secretary of Defense for Acquisition, Technology and Logistics to include all 

required elements in DOD’s future corrosion reports.

• Direct the Secretary of each military department to provide the required information on 

funding levels necessary to carry out all duties of the corrosion control and prevention 

executive. As the military departments develop the elements needed to provide the full 

funding levels, they should include these elements in their annual reports. 

• DOD concurred with the recommendations in that report.

9 GAO, Defense Management: The Department of Defense’s Fiscal Year 2012 Corrosion Prevention and Control Budget Request , GAO-11-490R (Washington, 

D.C.: Apr. 13, 2011).

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Scope and Methodology

To determine the extent to which DOD’s annual corrosion budget report included the six 

mandated elements, as well as the extent to which one of these elements―the military 

departments’ annual corrosion reports―included recommendations pertaining to the military 

departments’ CPC program and corrosion-related funding levels required to carry out all of the 

duties of the corrosion control and prevention executive, we

• Independently reviewed the annual report using two analysts, compared and reconciled 

their observations, and recorded the analysts’ consensus observations;

• Discussed our preliminary analyses with CPO and military department officials to seek 

additional information in those cases where we determined that a report did not include the 

mandated elements; and

• Considered the element to be “included” when the report explicitly discussed all parts of the

mandated element and “not included” when the report did not explicitly address any part of 

the element. If the report included some aspects of an element, but not all, then we 

considered the element “partially included.”

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Scope and Methodology (cont.)

• To determine the extent to which DOD’s CPC funding request met DOD’s total estimated CPC 

funding requirements for activities and projects, we analyzed DOD’s FY 2013 corrosion report 

and interviewed DOD officials. 

• To determine the cost avoidance11 that DOD may achieve by funding CPC at the level requested 

in its FY 2013 corrosion budget materials report and the cost avoidance DOD may potentially 

miss by not fully funding its requirements, 

• We reviewed DOD’s FY 2013 corrosion report, interviewed DOD officials, and requested 

further documentation and details about how DOD determined the ROI cited in its report.

• We did not independently validate DOD’s estimated CPC activity ROI or the assumptions 

that support the projected or validated ROIs of individual projects. We did compare projected 

ROIs to validated ROIs where available to determine if DOD was using the most up-to-date 

ROIs. 

11 In the past, we have calculated the cost avoidance DOD could achieve with its budget request by taking the requests for both projects and activities and 

multiplying those amounts by the respective ROIs reported by DOD. In the past, we have also calculated the cost avoidance DOD might be missing by not 

fully funding its requirements by taking the shortfalls for both projects and activities and multiplying them by the respective ROIs reported by DOD.

Page 12
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Scope and Methodology (cont.)

We conducted this performance audit from February 2012 through September 2012 in accordance 

with generally accepted government auditing standards. Those standards require that we plan and 

perform the audit to obtain sufficient, appropriate evidence to provide a reasonable basis for our 

findings and conclusions based on our audit objectives. We believe that the evidence obtained 

provides a reasonable basis for our findings and conclusions based on our audit objectives.

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Summary – Objective 1

Objective 1 – Determine the extent to which DOD’s corrosion report included the six mandated 

elements.

Of the six mandated elements, DOD’s FY 2013 corrosion report included three elements, did not 

include two elements, and one element was not applicable this year. 

Page 14

Figure 2: GAO Assessment of DOD's Fiscal Year 2013 Corrosion Budget Report

Six mandated elements GAO assessment 

Funding requirements for the long-term strategy Included

The return-on-investment (ROI) that would be achieved by implementing the strategy Included

For the fiscal year covered by the report and the preceding year, the funds requested in the budget compared to 

the funding requirements. Not included

An explanation if the funding requirements are not fully funded in the budget. Not applicablea

For the fiscal year covered by the report and the preceding year, the amount of funds requested in the budget for 

each project or activity compared to the funding requirements for the project or activity. Not includedb

A copy of the annual corrosion report most recently submitted by the corrosion control and prevention executive of 

each military department, to include (1) recommendations pertaining to the military department’s CPC program 

and (2) corrosion-related funding levels required to carry out all of the duties of the corrosion control and 

prevention executive (in an annex to the report).

Included

a DOD cited various reasons why the funding requirements may not be fully funded in the budget, but no 

explanation was needed since the funding requirements are fully funded in the budget, according to CPO officials.

b For the fiscal year covered by the report, DOD cannot provide this information, because it does not know what 

projects it will perform at the time of its report.

Source: GAO analysis of DOD data.
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Summary – Objective 1 (cont.)

• DOD’s corrosion report included three elements: corrosion funding requirements for FY 

2013, the ROI for projects and activities, and the annual military departments’ reports in an 

annex. However, the report would have benefited from additional information in some areas. For 

example, while the report included a funding requirement of $9.1 million, the analysis and 

documentation that DOD provided did not support how it determined this funding requirement. 

• DOD’s corrosion report did not include two elements: the funds requested in the budget 

compared to the funding requirements for the fiscal year covered by the report and the preceding 

fiscal year; and the amount of funds requested in the budget compared to the funding 

requirements for each project or activity in the strategy for the fiscal year covered by the report 

and the preceding fiscal year. 

• One element was not applicable this year: an explanation of the reasons the funding 

requirements are not fully funded in the budget. DOD’s corrosion report contains such an 

explanation; however, as reported by CPO officials, the funding requirements are fully funded in 

the budget request for FY 2013. Therefore, no explanation is necessary.

• Without all the required information, DOD senior leaders and Congress may face challenges in 

assessing the levels of funding needed to effectively prevent and control corrosion.

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Summary – Objective 2

Objective 2 – Assess the extent to which DOD’s CPC funding request met total estimated CPC 

funding requirements for activities and projects as identified in the FY 2013 DOD corrosion 

report. 

DOD requested $9.1 million for CPC in its FY 2013 budget. According to DOD officials, the FY 2013 

funding requirements are also $9.1 million, so the funding request meets the funding requirements for 

FY 2013.

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Summary – Objective 3

Objective 3 – Calculate the potential cost avoidance that DOD may achieve by funding CPC at 

the level requested in its FY 2013 corrosion budget materials report and the cost avoidance 

DOD may potentially miss by not fully funding its requirements.

• We did not calculate the cost avoidance DOD could achieve with its FY 2013 budget 

request, because the analysis DOD provided does not support the average ROI for projects 

cited in its report and does not contain the most up-to-date information, as recommended 

by GAO guidance.12

• According to DOD officials, DOD’s funding requirements are the same as the budget 

request. Therefore, we also did not calculate a cost avoidance for what DOD might be 

missing. 

• Without assurance that DOD’s average ROI for projects is based on the most complete and 

up-to-date data, Congress will not have the complete information it needs to make wellinformed decisions about CPC’s budget.

12 GAO, GAO Cost Estimating and Assessment Guide: Best Practices for Developing and Managing Capital Program Costs, GAO-09-3SP (Washington, D.C.: 

March 2009).

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Objective 1 – Extent report included mandated elements

DOD’s corrosion report included three of six mandated elements 

DOD’s corrosion report included corrosion funding requirements for FY 2013, the estimated ROI for 

projects and activities, and the most recent annual corrosion reports of the military departments. 

1. Funding requirements for the long-term strategy―Included. For FY 2013, DOD reported 

CPC funding requirements of $9.1 million – approximately $4.6 million for corrosion activities 

and approximately $4.5 million for technology demonstration projects. According to DOD 

officials, DOD senior leadership decided to align the funding requirements to the President’s 

budget request in FY 2013. This resulted in funding requirements considerably less than in 

past years. DOD officials told us that there was supporting analysis for how DOD calculated 

its FY 2013 funding requirements, but the analysis DOD provided us did not support the $9.1 

million funding requirements.

The report would have benefited from additional information on how DOD calculated its 

funding requirements. Without details on the methodology, Congress lacks key information 

about whether DOD’s funding of the CPC program can address the costs of corrosion 

prevention and control. GAO guidance states that cost estimating assumptions should be 

complete, realistic and backed up by historical data.13

13 GAO-09-3SP.

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Objective 1 – Extent report included mandated elements

DOD’s corrosion report included three of six mandated elements (cont.)

2. The return-on-investment that would be achieved by implementing the strategy―Included. 

DOD reported an average ROI in excess of 14 to 1 for technology demonstration projects and 2 

to 1 for corrosion activities.

• CPO officials stated that the office performed an analysis and determined that the average 

ROI for projects was in excess of 14 to 1. Further, they stated that the analysis contained 

some validated ROIs. However, the ROI analysis DOD provided only contains the projected 

ROIs and does not contain the more up-to-date validated ROIs. Also, documentation does 

not explain how the department determined its reported projected ROI in excess of 14 to 1. 

Therefore, we cannot confirm whether this ROI is accurate or whether validated ROIs were 

included.14

• DOD officials stated that, due to the nature of the CPC activities, it is difficult to quantify an 

ROI for activities. The 2 to 1 ROI for activities cited in DOD’s report is an estimate that 

officials believe is conservative.

14 For more information on the validated ROIs of projects versus the projected ROIs of projects, see Objective 3.

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Objective 1 – Extent report included mandated elements

DOD’s corrosion report included three of six mandated elements (cont.)

3. Copies of the most recent annual reports of the military departments – Included. DOD’s 

report includes the annual corrosion reports of all three military departments.

• The Army and the Navy reports included recommendations pertaining to the CPC efforts of 

their respective departments.

• The Air Force’s annual report does not include recommendations pertaining to the CPC 

efforts of the department. 

• All of the military departments identified some, but not all, of the funding necessary to 

perform the duties of the corrosion control and prevention executive.15

15 In our review of DOD’s FY 2012 corrosion report, we recommended that the military departments include in their annual reports the required information on 

funding levels necessary to carry out all duties of the corrosion control and prevention executive. See GAO-11-490R. 

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Objective 1 – Extent report included mandated elements

DOD’s corrosion report included three of six mandated elements (cont.)

Army Report

Recommendations pertaining to the CPC efforts of the Army

• The Army’s report contains recommendations that the Army corrosion control and 

prevention executive has made to various Army entities to address corrosion issues. For 

example: 

• Alternatives to using cancer-causing agents, such as hexavalent chromium and 

cadmium coatings, which combat corrosion, need to be proliferated Army-wide. 

• To address a unique corrosion issue on UH-60 Black Hawk helicopter tail-rotor 

quadrants, precautionary re-balancing of the tail-rotors was recommended to an Army 

Reserve National Guard Aviation unit.

Funding required to perform the duties of the corrosion control and prevention executive

• The report identifies some of the funding requirements to perform some of the corrosion 

control and prevention executive’s duties as the Army’s principle point of contact to DOD’s 

Director, Corrosion Policy and Oversight, and to develop the Army’s annual report on 

corrosion. 

• The Army‘s report does not include the funding required for all of the duties of the corrosion 

control and prevention executive because, according to Army officials, the legislative 

language does not clearly define these duties. 

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Objective 1 – Extent report included mandated elements

DOD’s corrosion report included three of six mandated elements (cont.)

Navy Report

Recommendations pertaining to the CPC efforts of the Navy

• The Navy’s report contains recommendations in its Executive Summary, such as

• Increasing the level of funding for CPC programs and projects, which could provide an 

opportunity to realize significant cost avoidance and potential budgetary savings.

• Advocating for a DOD policy requiring CPC to be addressed in the early stages of the 

acquisition process.

Funding required to perform the duties of the corrosion control and prevention executive

• According to Navy officials, the Navy’s corrosion-related funding requirements and its report 

do not include the funding required for all of the duties of the corrosion control and 

prevention executive. However, the Navy’s annual report for 2011 reported that the 

corrosion control and prevention executive had requested $973,000 to perform his duties in 

FY 2012. 

• Like the Army officials, the Navy officials believe the legislative language does not clearly 

define the duties of the corrosion control and prevention executive. As a result, the Navy is 

having difficulty identifying all of its corrosion control and prevention executive’s duties. 

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Objective 1 – Extent report included mandated elements

DOD’s corrosion report included three of six mandated elements (cont.)

Air Force Report

Recommendations pertaining to the CPC efforts of the Air Force

• Although the Air Force included recommendations in its 2010 annual report, its 2011 report 

does not include recommendations. This is because of internal reorganization that resulted 

in the loss of Air Force corrosion expertise, according to the Air Force official who 

coordinated with CPO at the time of our review.16 Further, this official said that at the time of 

the report the Air Force did not have a good grasp on its overall corrosion issues, and 

therefore it was not in a position to make recommendations.

• By not including recommendations in its 2011 annual corrosion report, the Air Force has not 

provided Congress the information it needs to determine if the Air Force is taking steps to 

effectively mitigate corrosion.

• Subsequent to issuing its annual report, the Air Force developed a long-term corrosion 

strategic plan, in June 2012, that contains several goals that may aid in addressing some of 

its corrosion issues.17

16 The Air Force’s corrosion control and prevention executive position was vacant from late 2010 through the time the Air Force issued its 2011 annual report. The 

Air Force filled the position in April 2012.

17 The Air Force developed this strategic plan as a result of the direction in House Report 112-78, accompanying H.R. 1540, a bill for the fiscal year 2012 National 

Defense Authorization Act.

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Page 30 GAO-12-823R Defense Management

Objective 1 – Extent report included mandated elements

DOD’s corrosion report included three of six mandated elements (cont.)

Air Force Report (cont.)

Funding required to perform the duties of the corrosion control and prevention executive

• The report identifies some funding for tactical corrosion actions/activities by aircraft and 

weapon system.

• The Air Force official stated that the department cannot identify all the funding required to 

perform the duties of the corrosion control and prevention executive because the position 

was vacant from late 2010 until late April 2012. Also, the Air Force shares the concern of 

the Army and Navy regarding the lack of clarity in the legislative language defining the 

duties of the corrosion control and prevention executive.

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Page 32 GAO-12-823R Defense Management

Objective 1 – Extent report included mandated elements

DOD corrosion report did not include two of six mandated elements (cont.)

5. The funds requested in the budget compared to the funding requirements for each project 

or activity for the fiscal year covered by the report (FY 2013) and the preceding fiscal year 

(FY 2012)19 – Not Included

• CPO officials stated that they will not be able to meet this requirement for the year covered 

by the report, because they do not know what projects will actually be submitted by the 

military departments until after they submit their budget report. We acknowledge that, due 

to its timeline for accepting projects, DOD cannot provide these data for the year covered 

by the report.

• CPO officials could not explain why this information was not included for the prior year. 

They stated that the information is available and could be included. They added that it may 

have been omitted either to make the report more concise or because CPO does not know 

the final amount of funding provided by the military departments for each project. 

• Without the comparison of funding requirements to the funding request for the year of the 

report and the prior fiscal year, as well as the breakdown by project and activity for the prior 

fiscal year, Congress may not have all of the data it needs to exercise oversight and make 

well-informed decisions regarding CPC funding. 

19 DOD did not include these data in last year’s corrosion report and this was the subject of one of our recommendations. Therefore, we are not making another 

recommendation this year. See GAO-11-490R. 

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Objective 1 – Extent report included mandated elements

One of the six mandated elements was not applicable this year

6. An explanation if the funding requirements are not fully funded in the budget – Not 

Applicable. DOD’s corrosion report contains an explanation for why the requirements are not 

fully funded in the budget request.20 However, as reported by CPO officials, the funding 

requirements are fully funded in the budget request for FY 2013. Therefore, no explanation is 

necessary.

20 The explanation that DOD provides is that global commitments, constrained budgets, and the valid requirements of other programs may preclude fully funding 

DOD’s CPC requirements.

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Objective 2 – Extent funding request meets requirements 

According to officials, the funding request meets requirements for FY 2013

• CPO officials stated that both the funding requirements and funding request for CPC in FY 2013 

are $9.1 million; therefore, the request meets the requirements. As previously stated, DOD senior 

leadership decided to align the funding requirements with the President’s budget request in FY

2013. This resulted in funding requirements considerably lower than in past years (see table 1).

• For the past four years, DOD has identified a budget shortfall, because its funding requirements 

exceeded its funding request. However, this year DOD did not report a shortfall. 

Table 1: DOD’s Reported CPC Funding Requirements for Activities and Preliminary Project Proposals, Budget Requests, and 

Budget Shortfalls, Fiscal Years 2009 to 2013 (Dollars in Millions)

Source: GAO analysis of DOD data.

a Totals for a fiscal year may not add due to rounding. The reported budget shortfall is the total estimated CPC funding requirements for activities and 

preliminary project proposals minus the CPC budget request. 

Page 28

Fiscal Year Activity 

Requirements

Preliminary 

project proposal 

requirements

Sum of activities 

and preliminary 

project proposalsa

CPC budget 

request

Reported budget 

shortfalla

2009 3.4 28.5 32.0 14.2 17.8

2010 6.2 21.5 27.7 13.1 14.5

2011 6.5 40.6 47.0 12.0 35.1

2012 8.3 34.9 43.2 11.1 32.1

2013 4.6 4.5 9.1 9.1 0
Page 35 GAO-12-823R Defense Management

Objective 3 – Potential Cost Avoidance

Cost avoidance not calculated for fiscal year 2013

In the past, we calculated the cost avoidance DOD could achieve with its budget request by taking 

the requests for both projects and activities and multiplying those amounts by the respective ROIs 

reported by DOD. 

• The military departments have made progress in validating ROIs over the past two years. 

The DOD Corrosion Prevention and Mitigation Strategic Plan21 states that a projected ROI 

must be included when a project is submitted, and that a follow-on review including a 

validated ROI should be submitted about 5-6 years after the project is funded. 

• We reported in 2010 that the military departments had completed the required ROI 

validations for 10 of 28 projects funded in FY 2005.22

• As of May 2012, the military departments have completed the required ROI validations for 25 

of 28 projects funded in FY 2005, and provided over 35 validated ROIs in total.23

21 Department of Defense, Department of Defense Corrosion Prevention and Control Strategic Plan (Washington, D.C.: 2011).

22 GAO, Defense Management: DOD Has a Rigorous Process to Select Corrosion Prevention Projects But Would Benefit from Clearer Guidance and Validation of 

Returns on Investments, GAO-11-84 (Washington, D.C.: Dec. 8, 2010).

23 Four of the 25 validations from FY 2005 resulted in an unknown ROI. The 35 total validated ROIs are for funded projects ranging from fiscal years 2005-2008.

Page 29
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Page 37 GAO-12-823R Defense Management

Conclusions

• DOD included some, but not all, of the information in its FY 2013 corrosion budget report to 

Congress that is mandated by Section 2228(e) of Title 10, as amended. For example, DOD’s report 

did include the annual corrosion reports of the military departments attached in an annex. However, 

the report did not include the funds requested in the budget compared to the funding requirements 

for the fiscal year covered by the report and the preceding fiscal year. Additionally, the analysis and 

documentation that DOD provided did not support how it determined its FY 2013 funding 

requirements. 

• Unlike in prior years, when DOD only reported on projected ROIs for corrosion projects, the military 

departments are now validating ROIs, which provides DOD with more up-to-date data for its 

corrosion report. However, the analysis DOD provided did not support the ROI for projects in excess 

of 14 to 1 cited in its report and did not include the most up-to-date information. 

• Without complete and detailed information, Congress may be limited in its efforts to provide 

oversight and make well-informed decisions about whether DOD’s funding of the CPC program will 

enable the Department to effectively address corrosion prevention and mitigation.

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Recommendations for Executive Action

To ensure that Congress has the accurate and comprehensive information it needs to exercise its 

oversight responsibilities, we recommend for FY 2013 and beyond that the Secretary of Defense direct 

the Under Secretary of Defense for Acquisition, Technology and Logistics to take the following three 

actions:

• Provide in the annual corrosion budget report to Congress a more detailed explanation of the 

development of DOD’s funding requirements.

• Include in the annual corrosion budget report to Congress the funds requested in DOD’s budget 

compared to the funding requirements for the fiscal year covered by the report and the 

preceding fiscal year. 

• Provide in the annual corrosion budget report to Congress an explanation of DOD’s ROI 

methodology and analysis, including both projected and, to the extent available, validated ROIs.

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Related GAO Products

• Defense Management: The Department of Defense’s Fiscal Year 2012 Corrosion Prevention and 

Control Budget Request. GAO-11-490R. Washington, D.C.: April 13, 2011.

• Opportunities to Reduce Potential Duplication in Government Programs, Save Tax Dollars, and 

Enhance Revenue. GAO-11-318SP. Washington, D.C.: March 1, 2011. 

• Defense Management: DOD Needs to Monitor and Assess Corrective Actions Resulting from Its 

Corrosion Study of the F-35 Joint Strike Fighter. GAO-11-171R. Washington, D.C.: December 16, 

2010.

• Defense Management: DOD Has a Rigorous Process to Select Corrosion Prevention Projects, 

but Would Benefit from Clearer Guidance and Validation of Returns on Investment. GAO-11-84. 

Washington, D.C.: December 8, 2010. 

• Defense Management: Observations on the Department of Defense’s Fiscal Year 2011 Budget 

Request for Corrosion Prevention and Control. GAO-10-607R. Washington, D.C.: April 15, 2010.

• Defense Management: Observations on Department of Defense and Military Service Fiscal Year 

2011 Requirements for Corrosion Prevention and Control. GAO-10-608R. Washington, D.C.: April 

15, 2010.

• Defense Management: Observations on DOD’s Fiscal Year 2010 Budget Request for Corrosion 

Prevention and Control. GAO-09-732R. Washington, D.C.: June 1, 2009. 

Page 33
Page 40 GAO-12-823R Defense Management

Related GAO Products (cont.)

• Defense Management: Observations on DOD’s Analysis of Options for Improving Corrosion 

Prevention and Control through Earlier Planning in the Requirements and Acquisition Processes. 

GAO-09-694R. Washington, D.C.: May 29, 2009.

• Defense Management: Observations on DOD’s FY 2009 Budget Request for Corrosion 

Prevention and Control. GAO-08-663R. Washington, D.C.: April 15, 2008. 

• Defense Management: High-Level Leadership Commitment and Actions Are Needed to Address 

Corrosion Issues. GAO-07-618. Washington, D.C.: April 30, 2007. 

• Defense Management: Additional Measures to Reduce Corrosion of Prepositioned Military Assets 

Could Achieve Cost Savings. GAO-06-709. Washington, D.C.: June 14, 2006. 

• Defense Management: Opportunities Exist to Improve Implementation of DOD’s Long-Term 

Corrosion Strategy. GAO-04-640. Washington, D.C.: June 23, 2004. 

• Defense Management: Opportunities to Reduce Corrosion Costs and Increase Readiness. GAO03-753. Washington, D.C.: July 7, 2003. 

• Defense Infrastructure: Changes in Funding Priorities and Strategic Planning Needed to Improve 

the Condition of Military Facilities. GAO-03-274. Washington, D.C.: February 19, 2003. 

Page 34
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Enclosure II: Comments from the Department of Defense
Page 42 GAO-12-823R Defense Management
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