Afghanistan Equipment Drawdown: Progress Made, but Improved Controls in Decision Making Could Reduce Risk of Unnecessary Expenditures
Published: 2014-09-30T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: DOD anticipates that the drawdown from Afghanistan will be more difficult than that from Iraq due to logistical challenges and the costs of transporting equipment out of landlocked Afghanistan. As of summer 2013, the Army and Marine Corps had substantial amounts of equipment in Afghanistan. The efficiency and effectiveness of equipment disposition decision making can directly affect the total cost of the drawdown.
GAO was asked to review DOD's efforts to execute the drawdown in a cost-effective and efficient manner. GAO examined: (1) the status of DOD's efforts to draw down equipment from Afghanistan and (2) the extent to which DOD has taken steps to create efficiencies and consider costs concerning the return of equipment from Afghanistan. To evaluate these efforts, GAO reviewed documents and data containing approximately 10,000 disposition decisions made over a 12-month period, in addition to interviewing DOD officials in the United States and Afghanistan.
section_title: What GAO Found
paragraphs: The Department of Defense (DOD) has made some progress in its drawdown of equipment from Afghanistan, but ongoing uncertainties about the future force in Afghanistan could affect progress of the drawdown. Specifically, from October 2012 to October 2013, DOD returned from Afghanistan or destroyed 14,664 vehicles, an average of 1,128 vehicles per month. Future progress toward drawdown goals will depend on equipment turn-in rates, which, in turn, depend on having more information about the post-2014 force level and mission. In addition, over the course of the last 8 months of the above period, the number of vehicles turned in by units for the drawdown averaged 55 percent of what had been forecast. This is because some vehicles that had been forecast for turn-in were instead redistributed to other units in Afghanistan. A senior DOD official stated that units have retained equipment because of uncertainty regarding future operational needs in Afghanistan. Once the post-2014 force level and mission are announced, these vehicle turn-in rates may increase.
DOD has taken some steps to improve efficiencies and manage costs in its Afghanistan drawdown processes. For example, U.S. Central Command amended its drawdown instruction to allow for aggregation of equipment at U.S. ports. According to DOD officials, this will allow for shipment of equipment via rail, resulting in potential savings when compared with trucking costs. However, due to ineffective internal controls, the Army and Marine Corps may be incurring unnecessary costs by returning equipment that potentially exceeds service needs or is not economical to return and repair. Specifically, GAO found the following:
In a 12-month period, the Army and Marine Corps returned more than 1,000 potentially unneeded vehicles, thereby incurring estimated transportation costs of up to $107,400 per vehicle, depending on the type of vehicle. DOD guidance indicates that equipment exceeding certain service-approved quantities should not be retained unless economic or contingency reasons support its retention. However, neither the Army nor the Marine Corps documented and reviewed justifications for returning items exceeding these approved quantities. Federal internal control standards state that documentation and review should be part of an organization's management to provide reasonable assurance that operations are effective and efficient.
The Army and Marine Corps may have returned vehicles that were uneconomical to return and repair because they did not consider transportation costs in making equipment-disposition decisions. DOD guidance states that all costs associated with materiel management, including transportation costs, shall be considered in making best-value decisions throughout the DOD supply chain. When all costs are not included in the decision-making process, there is risk of allowing the return and repair of uneconomical-to-return-and-repair equipment.
This is a public version of a For Official Use Only (FOUO) report GAO issued previously, which omits FOUO information and data such as the schedule of drawdown efforts, numbers of vehicles returned, overall drawdown goals, and some cost information that DOD deemed FOUO.
section_title: What GAO Recommends
paragraphs: GAO recommends that DOD ensure that the Army and Marine Corps document and review justifications for the return of potentially unneeded items and that transportation costs and other relevant costs be included in disposition decision making. DOD concurred with GAO's recommendations.

section_title: Letter
paragraphs: Early in 2013, the President announced that the United States planned to  end participation in combat operations in Afghanistan on December 31,  2014. As the Department of Defense (DOD) proceeds with troop  reductions, it will also make decisions on the disposition of large stocks of  equipment that were shipped to Afghanistan in support of military  operations. Generally, DOD distinguishes between non-rolling stock,  much of which can be containerized for transport, and rolling stock, or  vehicles. DOD officials told us that vehicles are a reliable indicator of  drawdown progress. According to these officials, vehicles also represent  the most challenging equipment to move out of Afghanistan. In October  2013, DOD estimated that there were thousands of vehicles remaining in  Afghanistan. According to DOD officials, some vehicles will remain in  Afghanistan for use by the post-December 2014 force, but military service  guidance indicates that equipment is not to be left behind or abandoned.
DOD anticipates that the drawdown from Afghanistan will be more  complex than was the Iraq effort, which a senior DOD official described  as one of the most complex logistical operations in U.S. military history.  Logistical infrastructure and seaports in neighboring Kuwait facilitated the  equipment drawdown from Iraq. Conversely, from landlocked Afghanistan  it takes weeks to drive to the nearest seaport, and there is no staging  area where equipment can be stored to await processing and  transportation.
DOD officials have three basic disposition options for drawing down  equipment in Afghanistan: (1) returning it to DOD inventories outside of  Afghanistan; (2) transferring it to another U.S. government agency or the  government of another country; or (3) destroying it in Afghanistan. There  are extraordinary challenges and costs to returning equipment that has  accumulated in a landlocked country after more than 10 years of combat  operations. The efficiency of the drawdown process and the effectiveness  of decision making on equipment disposition can directly increase or  decrease the costs of drawdown in Afghanistan.
This is our second report on DOD’s efforts to draw down equipment in  Afghanistan. In December 2012, we reviewed DOD’s Afghanistan  drawdown planning efforts and reported that the return of equipment  items from Afghanistan was only supported by informal cost-benefit  analyses, and that none of the military services was able to provide us  with documentation of these informal cost-benefit analyses. We therefore  recommended that, as part of drawdown planning efforts, the military  services and U.S. Central Command (CENTCOM) conduct and document  analyses to compare the costs of returning excess major end items  against the benefits of returning them. We further recommended the use  of these cost-benefit analyses as a key factor in decision making  concerning the return of excess major end items. DOD concurred with  these recommendations and has taken some actions to implement them.
For this review, you asked us to examine whether DOD’s efforts to  execute the drawdown were done in a cost-effective and efficient manner.  We examined: (1) the status of DOD’s efforts to draw down equipment  from Afghanistan; and (2) the extent to which DOD has taken steps to  create efficiencies and consider costs concerning the return of equipment  from Afghanistan.
This report is a public version of the prior sensitive report that we issued.  DOD deemed some of the information in the prior report as For Official  Use Only (FOUO), which must be protected from public disclosure.  Therefore, this report omits FOUO information and data such as the  schedule of drawdown efforts, numbers of vehicles returned, overall  drawdown goals, and some cost information about DOD’s efforts to draw  down its equipment in Afghanistan. Although the information provided in  this report is more limited in scope, it addresses the same questions as  the sensitive report. Also, the overall methodology used for both reports is  the same.
To conduct this work, we interviewed and obtained documentation from  cognizant officials from CENTCOM, the combatant command responsible  for operations in Afghanistan, as well as from the military services. To  examine the status of DOD’s efforts to reduce equipment in Afghanistan,  we identified drawdown goals and key sources of documentation.  Specifically, we identified and analyzed the processes and facilities that  support CENTCOM in the execution of the drawdown and examined  guidance from the Office of the Secretary of Defense, Joint Chiefs of  Staff, CENTCOM, U.S. Transportation Command (TRANSCOM), military  departments and services, and the Defense Logistics Agency (DLA). We  then examined the metrics used by drawdown decision makers, reviewed  Afghanistan drawdown statistics, and compared these statistics with  DOD’s drawdown goals.
To analyze the steps DOD has taken to create efficiencies and consider  costs concerning the return of equipment from Afghanistan, we obtained  and analyzed standard operating procedures and other guidance used to  return equipment from Afghanistan and interviewed officials familiar with  the transportation of equipment out of Afghanistan. To determine the  extent to which the services have taken steps in their disposition decision- making process to consider costs related to the return of equipment, we  reviewed equipment-management guidance and interviewed service  equipment managers. We focused our review on vehicles because of the  costs associated with transporting them, the number of vehicles that are  candidates for disposition, and the ability to track vehicles by identification  number. We also focused our review on theater-provided equipment that  will be repaired. In addition, we focused our review to include only the  Army and the Marine Corps since these services have owned the  preponderance of equipment in Afghanistan. We surveyed the  organizations responsible for maintaining the approved acquisition  objective, inventory, and disposition-decision databases in order to  determine the reliability of the data we analyzed.determined that the data were sufficiently reliable for determining how  many vehicles were returned that exceeded approved acquisition  objectives. A more-detailed discussion of our scope and methodology is  included in appendix I.
From these efforts, we  We conducted this performance audit from January 2013 to September  2014 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.
subsections: section_title: Background
subsections: section_title: Drawdown Rates for Personnel Differ from Those for Equipment
paragraphs: One of the DOD lessons learned from Iraq is to begin drawdown  operations early because of their complexity. To that end, the Marine  Corps began equipment drawdown operations for Afghanistan in August  2011, and the Army began in January 2012—both starting well before the  January 2013 announcement that combat operations would end in  December 2014. According to DOD officials, one reason these early  actions to reduce equipment were warranted is that it takes longer to  draw down equipment from Afghanistan than it does to reduce personnel  levels.
section_title: Decision Framework for the Drawdown of Equipment
paragraphs: CENTCOM is the command responsible for drawdown operations in  Afghanistan. However, the military services determine disposition for their  equipment that is to be drawn down in Afghanistan, and TRANSCOM  arranges transportation for the items that the services decide to return  from Afghanistan. Figure 1 illustrates the equipment-disposition  framework used to draw down Army and Marine Corps equipment from  Afghanistan.
Officials in the Army and the Marine Corps manage their respective  services’ equipment throughout the equipment’s life cycle. Once  CENTCOM officials determine that a piece of equipment is no longer  needed in Afghanistan (see fig. 1, box 2), a request for disposition is sent  to equipment managers in the United States, who decide whether to  divest or retain the item. If an item is retained it will be returned from  Afghanistan. If an item is divested it will be transferred or destroyed.  These three general options are described as follows.
Return: This is the shipment of equipment to a repair facility.  Service  officials forecast that the majority of equipment is likely to be returned  from Afghanistan to service inventories. Equipment that is to be returned  is delivered to one of the seven service-operated Redistribution Property  Assistance Team (RPAT) yards or similar facilities situated throughout  Afghanistan, where each piece is inspected and readied for transport.  (See apps. II and III.)
Transfer: This is the redistribution of equipment to either another U.S.  agency or the government of another country. DOD has described this as a limited option due to the limited ability of the Afghanistan government  to absorb and maintain large amounts of equipment. (See app. IV.)
Destroy: This is the demilitarization of equipment at Defense Logistics  Agency (DLA) Disposition Service disposition sites. The material may  then be sold as scrap. If a serviceable item is to be destroyed, DOD  requires certification that the item has been vetted through a service  process and that all avenues for reutilization/transfer have been  exhausted, or that a cost-benefit analysis was conducted and destruction  found to be the most cost-effective option. (See app. V.)
section_title: Factors Guiding Services’ Equipment Disposition Decision Making
paragraphs: This review focuses on theater-provided equipment that will be repaired. There is also  unit-owned equipment in theater that will be returned to units’ home stations. should be purchased at a lower cost; and the potential cost and benefit to  be derived from repairing or refurbishing the item. Managers’ decisions  may also be guided by service-wide decisions laid out in strategies  specific to a particular equipment type, such as the Mine Resistant  Ambush Protected vehicle. Equipment managers stated that these  strategies and other factors result in published lists of equipment that are  marked either for divesture (that is, transfer or destruction) or for retention  in the service inventory.
The Marine Corps publishes this information by equipment model in a “Ground  Equipment Reset Playbook,” which integrates Marine Corps equipment-requirements  data, equipment-reset strategies and on-hand inventories into a single-source document  that is used by all levels of the organization in support of equipment drawdown.
Corps equipment managers are guided by Marine Corps Order 4790.19,  Depot Maintenance Policy, which calls for comparing the cost of repair  against the cost of procuring the item. Unlike the Army guidance, which  establishes a maintenance expenditure limit for a specific item, the  Marine Corps order indicates that if the repair equals or exceeds 65  percent of the standard unit price or replacement cost for any piece of  equipment, the equipment is not economical to repair. Marine Corps  officials stated that these uneconomical-to-repair items should, ordinarily,  be divested.
Transportation costs are another factor that Army and Marine Corps  equipment managers should generally consider when making equipment  disposition decisions. Specifically, Army guidance includes transportation  costs in the determination of whether it is economical to repair an item  that is located overseas. Marine Corps guidance also indicates that  equipment managers should consider the cost to return an item when  making disposition decisions. Specifically, a Marine Corps order  regarding equipment return indicates that an item normally should not be  returned when the cost to return the item exceeds the cost to procure it  new. be expensive due to the transportation costs of moving an item out of  landlocked Afghanistan (see table 1). Moving a tactical vehicle back to  the United States, for example, can range in cost from $0.73 per pound to  more than $3.30 per pound. According to DLA Disposition Service  officials, destruction of the same type of vehicle costs between $0.28 and  $0.31 per pound.
See Marine Corps Order 4440.31E, Marine Corps Retention and Excess Returns  Policies for Wholesale and Retail Materiel Assets (June 23, 1989). For the purposes of  this report we refer to uneconomical-to-return-and-repair items as items that are  uneconomical to repair either because the sum of transportation and repair costs exceeds  authorized limits (Army) or because either the transportation or the repair costs exceed  authorized limits (Marine Corps).
Pakistan Ground Lines of  Communication  (PAKGLOC)
Northern Distribution  Network (NDN)-Russia  ªThe cost per vehicle is based on data furnished by U.S. Transportation Command (TRANSCOM) for  the estimated cost of returning a heavy and a light vehicle from Kandahar Air Force Base,  Afghanistan. Lowest cost reflects transport of a trailer. Highest cost reflects transport of a heavy  (18.5-ton) tactical vehicle on the same route.
section_title: Transportation Routes
paragraphs: To gain as much efficiency as possible in a drawdown, the military seeks  a synchronized transportation process that links the drawdown of  personnel, equipment, and materiel. A well-synchronized process can  expedite movement out of Afghanistan and avoid backlogs at facilities  and along transportation networks. Synchronization is characterized by  timely and predictable airflow and seaflow, and by the ability to adjust  transportation schedules. CENTCOM has issued instructions that guide  units as they arrange for equipment to leave Afghanistan through a  variety of air and surface routes (see fig. 2).
On the ground, equipment moves through Pakistan, using the Pakistan  Ground Lines of Communication (PAKGLOC) or through European and  central Asian countries, as part of the Northern Distribution Network  (NDN), to seaports from which it can be loaded onto ships for onward  movement overseas. As we have previously reported, however,  geopolitical complexities in the region make the use of these ground  routes challenging for equipment return. There are also airlift and  multimodal airlift (air and sea) options that fly equipment from Afghanistan  to ports in the region, from which the equipment can be transported  onward via ship. According to DOD, although airlift and multimodal airlift  are the more expensive transportation options, they have to date been  the most reliable in the equipment drawdown due to limitations associated  with the ground routes (see app. III).
section_title: Some Drawdown Progress Has Been Made, but Key Uncertainties Could Affect Future Progress
paragraphs: DOD has made some progress in its drawdown of equipment from  Afghanistan, but ongoing uncertainties about the future force in  Afghanistan could affect future progress of the drawdown. Specifically,  from October 2012 to October 2013, DOD returned from Afghanistan or  destroyed 14,664 vehicles, or an average of 1,128 vehicles per month.  Future progress toward drawdown goals will depend on equipment turn-in  rates which, in turn, depend on having more information about the post- 2014 force level and mission. However, DOD’s future force levels and  mission requirements beyond 2014 have not yet been announced.  Moreover, from March 2013 to October 2013, the number of vehicles  turned in by units for the drawdown averaged 55 percent of what had  been forecasted. This is because some vehicles that had been forecast  for turn-in were instead redistributed to other units in Afghanistan. A  senior DOD official stated that units have retained equipment because of  uncertainty regarding future operational needs in Afghanistan. Once the  post-2014 force level and mission are announced, these vehicle turn-in  rates may increase.
subsections: section_title: Equipment Drawdown Has Progressed as DOD’s Drawdown Goals Have Changed over Time
paragraphs: From October 2012 to October 2013, DOD returned from Afghanistan or  destroyed 14,664 vehicles, or an average of 1,128 vehicles per month.   DOD officials reported that, as of October 2013, thousands of vehicles  remained in Afghanistan. In March 2012, command officials in  Afghanistan established monthly goals for reducing equipment in country.  To meet their goals, DOD established capacities at DLA Disposition  Services sites, at RPAT yards, and on transportation routes. For the  purposes of this report, the term capacity refers to the infrastructure,  resources, and personnel in place to return or destroy a specific number  of vehicles or containers, or both, in a month. For example, in  Afghanistan, DLA Disposition Services initially established a destruction  capacity of 450 vehicles per month.
The Army unit responsible for RPAT facilities in Afghanistan initially  established a monthly processing capacity, and TRANSCOM also initially  established a monthly capacity to move vehicles out of the country. Although DLA and TRANSCOM officials told us that they are postured to  surge beyond current capacities if necessary, there has not been any  reason to do so because the amount of equipment turned in has not  required them to rely on surge capacity  TRANSCOM officials also told us that building the capacity of the routes  requires time and a steady increase in the amount of equipment required  to be moved, since frequent use incentivizes contractors to maintain en- route infrastructure. In June 2013, DOD transitioned from its monthly  reduction goals to new classified goals based on operational   DOD officials may further adjust these classified drawdown  milestones. goals as the post-December 2014 mission and size of the enduring force  are clarified, and as a result the reduction of vehicles may accelerate.
Equipment transfers to other countries or other U.S. agencies contribute to meeting the  equipment-drawdown goals. To date, this disposition option has been limited. See app. IV.
In June 2013, DOD produced detailed supporting plans that included phased operations  as well as milestones and objectives for equipment reduction. The specific goals are  classified; however, DOD officials in theater stated that in the period from June 2013 to  September 2013, DOD’s Afghanistan equipment reductions exceeded these goals.
section_title: Future Drawdown Progress Will Depend on Post-2014 Force Information and Turn-in Rates
paragraphs: Uncertainties about the future force in Afghanistan could affect the  progress of the drawdown. Because the United States has not yet  announced its post-2014 force level and mission in Afghanistan, the  future equipment needs are still uncertain. A high-level Army official has  stated that the goal is to draw down all equipment not needed by the  enduring force from Afghanistan by October 2014. However, with the  bilateral security agreement pending, the mission and size of the enduring  force has not yet been finalized, and the date by which all equipment  must be drawn down could change. DOD will need this information to  determine the amounts and types of equipment that will remain in  Afghanistan for the enduring presence and consequently the amount and  types of vehicles that will be drawn down.
These post-2014 uncertainties may affect the rate that vehicles are turned  in by units in Afghanistan, affecting the progress of DOD’s drawdown.  The current vehicle drawdown pace has been limited by lower-than- forecast quantities being turned in by units for drawdown. From March  2013 to October 2013, the number of vehicles turned in by units for the  drawdown averaged 55 percent of what had been forecasted. In some  instances, vehicles that had been forecast for reduction were redistributed  to other units in Afghanistan instead of turned in for destruction or return.  Commanders in Afghanistan must ensure that they have the equipment  necessary to accomplish their mission and sometimes have found it  necessary to retain equipment rather than release it. A senior DOD official  stated that in some cases units have retained equipment because of  uncertainty related to future operational needs in Afghanistan.  Consequently, the flow of vehicles to be destroyed at DLA sites or  returned via RPAT yards and transportation routes has been limited.  These turn-in rates may increase once the post-2014 force level and  mission are announced.
section_title: Steps Have Been Taken to Reduce Transportation Costs, but Improved Controls Could Mitigate Risk of Unnecessary Expenditures
paragraphs: DOD has taken some steps to improve efficiencies and manage costs in  its Afghanistan drawdown processes. For example, CENTCOM amended  its drawdown instruction to allow for aggregation of equipment at U.S.  ports. According to DOD officials, this will allow for shipment of equipment  via rail, resulting in potential savings when compared with trucking costs.  However, as a result of ineffective internal controls, the Army and Marine  Corps may be incurring unnecessary costs by returning equipment that  potentially exceeds service needs or that is not economical to return and  repair. DOD guidance on supply chain materiel management indicates  that equipment exceeding certain service-approved quantities should not  be retained unless economic or contingency reasons support its retention.  We found that in a 12-month period the Army and Marine Corps returned  more than 1,000 vehicles that exceeded their service-approved  quantities, thereby incurring possible transportation costs of up to  $107,400 per vehicle, depending on the type of vehicle, for equipment  that might no longer be needed. Neither the Army nor the Marine Corps  documented and reviewed justifications for returning these potentially  unneeded items, although federal internal control standards state that  documentation and review should be part of an organization’s  management to provide reasonable assurance that operations are  effective and efficient.
DOD guidance also states that all costs associated with materiel  management, including transportation costs, shall be considered in  making best-value decisions throughout the DOD supply chain. While the  services considered repair costs, they did not consider transportation  costs in determining whether vehicles were economical to return and  repair. Consequently, it is unclear how many vehicles the services may  have returned that were uneconomical to return and repair. Without  adequate internal controls to ensure that DOD is returning only equipment  that is needed and is considering transportation costs in these decisions,  the services are at risk for incurring unnecessary drawdown  expenditures.
subsections: section_title: DOD Has Taken Some Steps to Improve Efficiencies and Manage Transportation Costs
paragraphs: DOD has taken some steps to improve efficiencies and manage costs in  its drawdown processes, although DOD officials have stated that cost  savings or efficiencies gained as a result of these changes have yet to be  fully realized. In May 2013, CENTCOM amended its drawdown instruction  to provide TRANSCOM with earlier notice of the amount and types of  equipment requiring transportation.
Combatant commanders are responsible for redeployment planning, and  must consider synchronization—that is, linking the redeployment of  personnel, equipment, and materiel in a timely manner. To move  equipment out of the country as quickly and cost-effectively as possible,  TRANSCOM needs advance knowledge about the amount of equipment  to be moved. Acquiring this information is complicated by the fact that,  while personnel movements out of Afghanistan can be known 180 days in  advance, DOD officials have told us that transportation requirements for  equipment are more difficult to identify as early because the equipment  may still be needed in country. Prior to May 2013, it was difficult to obtain  advance knowledge about the amount of equipment to be moved  because TRANSCOM officials were notified that equipment was available  for movement only when it arrived at an RPAT yard. To create more  efficient transportation scheduling, in May 2013 CENTCOM amended its  drawdown instruction to require notifying transportation officials almost 90  days before equipment is turned in, and to require subsequent  confirmation of transportation needs 30 days before the arrival of  equipment at the RPAT yard.
Another step taken by CENTCOM was the amending of its drawdown  instruction in May 2013 to allow for the aggregation of equipment at U.S.  ports. According to TRANSCOM officials, this change may yield savings  because aggregating equipment at U.S. ports will allow for the  subsequent shipment of the equipment to final destinations via rail,  resulting in savings of up to 45 percent over trucking the equipment to  depots. For example, the cost to move three Mine Resistant Ambush  Protected vehicles from an East Coast port to a West Coast depot by  truck exceeds $20,300, while moving the same cargo by rail costs  $11,700. According to TRANSCOM analysis, rail transport is four times  more fuel efficient than truck transport and historically has resulted in  savings of between 20 and 60 percent for shipments of large volumes of  cargo. TRANSCOM officials expect that cost savings will accrue based on  these changes to the guidance. In addition, TRANSCOM has reduced  costs by more than doubling the number of vehicles returned through the  PAKGLOC and less expensive air routes since June 2013. TRANSCOM  estimates that this increased use of the PAKGLOC and less expensive air  routes has resulted in a potential cost avoidance of about $55 million.
section_title: Army and Marine Corps Lack Effective Controls for Returning Vehicles from Afghanistan
paragraphs: Ineffective internal controls over the equipment disposition decision  process allowed the Army and Marine Corps to return equipment from  Afghanistan that may have been unneeded. The DOD instruction  providing supply chain materiel-management policy states that all costs  associated with materiel management shall be considered in making  best-value decisions throughout the DOD supply chain. According to this  guidance, best-value decisions include the consideration of both cost and  noncost factors. The guidance further indicates that equipment exceeding  approved acquisition objectives should not be retained unless economic  or contingency reasons support its retention. The approved acquisition  objective is defined as the quantity of an item authorized for peacetime  and wartime requirements to equip and sustain U.S. and allied forces  according to DOD policies and plans. Consequently, any item in the  inventory that exceeds its approved acquisition objective is potentially  unneeded.
The term “vehicle” refers to rolling stock, such as tactical wheeled vehicles; multipurpose  or special-purpose military wheeled platforms that transport personnel and all classes of  supply; and powered and unpowered trailer systems. Vehicles can be specially designed  for the military or can be commercial vehicles modified to meet certain military  requirements. Vehicles are classified by weight, ranging from less than 2.5 tons to greater  than 10 tons. See app. I for a description of the methodology supporting this analysis. end ($5.9 million), and larger, heavier vehicles transported through the  most expensive routes at the high end ($111.1 million).
According to Army and Marine Corps officials, items exceeding approved  acquisition objectives may have been returned for a variety of reasons.  For example, officials told us that an item may be returned because it is  the newest model of a certain type of equipment, or because there may  be an increased requirement for an item in the future. However, we could  find no documentation that justified the return of these items. According to  federal internal control standards, documentation and review should be  part of an organization’s management to provide reasonable assurance  that operations are effective and efficient. approved acquisition objectives without documenting and reviewing the  justifications for doing so, the services are at risk for spending funds  unnecessarily to retain items that may not be needed.
section_title: Army and Marine Corps Did Not Have Effective Controls to Ensure Transportation Costs Were Considered in Disposition Decision Making
paragraphs: GAO/AIMD-00-21.3.1. transport and repair items that otherwise might not be economical to  retain.
The Army has established procedures to determine whether an item is  economical to return and repair. To ensure economic and operational  effectiveness, Army officials use a preset maintenance expenditure limit  to decide whether an item is economical to repair. For items located  overseas, the Army specifies that transportation and handling costs be  included in determining whether an item is economical to repair. When  making the decision to return and repair items from Afghanistan,  however, Army officials considered repair costs but omitted transportation  costs as a factor for consideration, though it is unclear why these costs  were omitted. It is unclear how Army officials could determine whether the  return and repair of equipment was economical without including the  transportation costs as a decision-making factor. It is also unclear how  many items returned by the Army from Afghanistan would have been  identified as uneconomical to return and repair if transportation costs had  been included in disposition decision making.
See Marine Corps Order 4790.19, Depot Maintenance Policy, para. 4.a(2)(g). their decision-making process, the services are at risk of allowing the  return and repair of uneconomical-to-return-and-repair equipment.
section_title: Conclusions
paragraphs: DOD officials have taken some positive steps to reduce costs and create  efficiencies in the drawdown of equipment from Afghanistan. The services  have established processes and have guidance that, if applied to  decisions about the disposition of equipment in Afghanistan, can inform  decision making about such equipment and ensure that decisions are  well-reasoned, reviewable, and made on the basis of best value.  However, by returning items without documentation and review of  justifications and by not including all costs in the decision-making  process, the Army and the Marine Corps are at risk of making  unnecessary expenditures. As the equipment drawdown accelerates,  potentially unneeded and uneconomical-to-return-and-repair items will  compete with other equipment for transportation assets. With improved  internal controls, the Afghanistan drawdown operations could be made  more efficient and cost-effective.
section_title: Recommendations for Executive Action
paragraphs: To reduce the risk of unnecessary expenditure of resources, we  recommend that the Secretary of Defense direct the Secretary of the  Army and the Commandant of the Marine Corps to take the following two  actions:  1.  ensure that justifications for returning items that exceed their  approved acquisition objectives are documented and receive  management review; and  2.  ensure that transportation and all other relevant costs are included in  disposition decision making.
section_title: Agency Comments
paragraphs: In written comments on the earlier FOUO version of this report, DOD  concurred with both of the recommendations and stated that it will be  taking steps to further improve service disposition decision-making  processes. DOD also provided technical clarifications, which we  incorporated, as appropriate. DOD’s written comments are reprinted in  appendix VI.
We are sending copies of this report to the appropriate congressional  committees; the Secretary of Defense; the Secretary of the Army; and the  Commandant of the Marine Corps. The report is also available at no  charge on GAO’s website at http://www.gao.gov.
If you or your staff have any questions about this report, please contact  me at (202) 512-5431 or russellc@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 listed in appendix VII.
section_title: Appendix I: Scope and Methodology
paragraphs: To conduct this work, we interviewed and obtained documentation from  cognizant officials from U.S. Central Command (CENTCOM), the  combatant command responsible for operations in Afghanistan, as well as  from the military services. To examine the status of the Department of  Defense’s (DOD) efforts to reduce equipment in Afghanistan, we  identified drawdown goals and key sources of documentation.  Specifically, we identified and analyzed the processes and facilities that  support CENTCOM in the execution of the drawdown and examined  guidance from the Office of the Secretary of Defense, Joint Chiefs of  Staff, CENTCOM, U.S. Transportation Command (TRANSCOM), military  departments and services, and the Defense Logistics Agency (DLA). We  then examined the metrics used by drawdown decision makers, reviewed  Afghanistan drawdown statistics, and compared these statistics with  DOD’s drawdown goals.
To analyze the steps DOD has taken to create efficiencies and consider  costs concerning the return of equipment from Afghanistan, we obtained  and analyzed standard operating procedures and other guidance used to  return equipment from Afghanistan and interviewed officials familiar with  the transportation of equipment out of Afghanistan. To determine the  extent to which the services have taken steps in their disposition decision- making process to consider costs related to the return of equipment, we  reviewed equipment-management guidance and interviewed service  equipment managers. We focused our review on vehicles because of the  costs associated with transporting them, the number of vehicles that are  candidates for disposition, and the ability to track vehicles by identification  number. We also focused our review on theater-provided equipment or  nonunit equipment that will be repaired. In addition, we focused our  review to include only the Army and the Marine Corps since these  services have owned the preponderance of equipment in Afghanistan.  We examined the factors and data used by decision makers who issued  disposition instructions, and analyzed the results of those decisions.  Specifically, we examined service inventories and approved acquisition  objectives—the amount of equipment needed by the services for  peacetime and wartime requirements—used by equipment managers to  make disposition decisions. To determine the service-approved  acquisition objective for any specific item, we relied on the databases  used by service officials to manage the relevant equipment. These data,  along with the disposition decision and inventory data, were used to  determine how many vehicles were returned that exceeded approved  acquisition objectives. Specifically, to determine whether an item that  exceeded its approved acquisition objective was returned from mid-March  2012 to mid-March 2013, we conducted one analysis for the Army and  one for the Marine Corps. For the Army, its equipment-management  officials determined which types of rolling stock exceeded service- approved acquisition objectives. We then took a list of these types of  rolling stock that the Army personnel had identified and compared this list  to data that the Army provided that contained the service’s disposition  decisions regarding rolling stock or vehicles in Afghanistan from mid- March 2012 to mid-March 2013. For the Marine Corps analysis,  equipment-management officials provided us with approved acquisition  data and inventory data from fiscal year 2012 and fiscal year 2013. We  then compared the inventory to the approved acquisition objective for  both years to identify the types of vehicles that exceeded the approved  acquisition objective. We took this list of the types of vehicles and then  compared it to data that the Marine Corps provided that contained the  service’s disposition decisions regarding rolling stock or vehicles in  Afghanistan from mid-March 2012 to mid-March 2013.
To determine the results of each service’s equipment disposition  decisions, we obtained and reviewed data containing approximately  10,000 disposition decisions made by the Army and Marine Corps over a  12-month period. Of these decisions, roughly 87 percent resulted in the  return of vehicles to the United States (the remaining 13 percent resulted  in either the return of the vehicles to a site outside of the United States or  the transfer or destruction of vehicles in country). Because our second  objective is related to the return of equipment, we focused our analysis on  these approximately 9,000 vehicle-return decisions. Moreover, we chose  the 12-month period spanning mid-March 2012 to mid-March 2013  because by that time each service had several months’ experience in  drawing down its equipment.
We also examined the transportation costs of returning these vehicles. To  estimate the costs of returning equipment, we used the rates  TRANSCOM charges the military services for representative types of  equipment. We surveyed the organizations responsible for maintaining  the databases in order to determine the reliability of the data. From these  efforts, we determined that the data were sufficiently reliable for  determining how many vehicles were returned that exceeded approved  acquisition objectives. To obtain additional information for our review, we  contacted or interviewed officials from the
Office of the Under Secretary of Defense for Acquisition, Technology
CENTCOM;
U.S. Forces-Afghanistan;
TRANSCOM;
Surface Deployment and Distribution Command;
Headquarters, Department of the Army;
U.S. Army Materiel Command;
U.S. Army Sustainment Command;
U.S. Army TACOM Life Cycle Management Command;
U.S. Marine Corps/Installations and Logistics;
U.S. Marine Corps Logistics Command;
U.S. Marine Corps Systems Command;
Headquarters, U.S. Navy;
Headquarters, U.S. Air Force/Equipment Management Branch; and  and Logistics;  Joint Staff;  Defense Logistics Agency (DLA) Disposition Services  We conducted this performance audit from January 2013 to September  2014 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.
Background  The Army has stated that  equipment will not be  abandoned in Afghanistan. To  assist units in processing  equipment for return and  arranging proper disposition, the  Army’s 401st Army Field  Support Brigade operates seven  RPAT facilities. Army officials  told us that each site has at  least 20 acres and is equipped  to prepare equipment to meet  international and U.S. customs  standards. RPAT yards process  equipment that is excess to  needs in theater and also  handle equipment that is battle- damaged or declared as a battle  loss. As seen below in figure 4,  the Bagram and Khandahar  yards account for more than 60  percent of the in-country RPAT  capacity.
Army Redistribution Property Assistance Teams (RPAT) operate facilities  in Afghanistan to process equipment, including vehicles and non-rolling  stock, for return to the United States. Units leaving Afghanistan bring  equipment that is no longer needed in Afghanistan to an RPAT yard to be  processed for return. After turn-in, it can take on average 29 days for non- rolling stock and 60 days for vehicles to be processed for shipment. As a  result, there is about a 2-month delay from turn-in to the final processing  of vehicles. Because all nonunit equipment must go through RPAT yard  processing before shipment, efficient RPAT operations are critical for the  transport of equipment out of Afghanistan. Further, to meet future  drawdown demand, it is likely that RPAT processing throughput will have  to increase from existing levels (see fig. 3).
RPAT processing capacity may become a limiting factor for the  Afghanistan drawdown. Army officials stated that RPAT facilities in  Afghanistan have the capacity to process more than 1,000 vehicles per  month. However, they have tested the upper limits of this capacity in only  3 months of a 20-month period (see fig. 3). Officials further stated that  they have not reached their capacities due to the limited rate of equipment  turn-in. Going forward, we note that simultaneous unit moves, base  closures, and other events may result in turn-in levels that exceed the  capacity of the facilities. Moreover, RPAT capacity is also a function of  space availability and the efficiency with which equipment can be moved  out of a yard. This efficiency depends on the ability of units to forecast  what equipment will be turned in as well as the ability of the transportation  system to move the equipment. From March 2012 to October 2013,  average transportation wait times were 44 days for vehicles and 19 days  for containers. In the future, RPAT output could be limited by the  scheduling of transportation assets and the availability of lines of  communication.
Background  In the drawdown from Iraq, the  majority of equipment was  processed and returned through a  nearby port in Kuwait. Due to the  landlocked geography of  Afghanistan and the challenging  political environment in Central  Asia, TRANSCOM must rely on  multiple routes and modes of  transportation for the return of  equipment from Afghanistan.
U.S. Transportation Command (TRANSCOM) has established 18 surface,  airlift, and multimodal airlift routes for the return of equipment from  Afghanistan. The Pakistan Ground Lines of Communication (PAKGLOC),  terminating at the port of Karachi, is the least expensive route out of  Afghanistan. To the north, the Northern Distribution Network (NDN)  broadly comprises three land routes terminating at several seaports: one  through Central Asia into the South Caucasus; one through Uzbekistan,  Kazakhstan, and Russia that ends in the Baltic states; and one through  Tajikistan, Kyrgyzstan, Kazakhstan, and Russia that also ends in the  Baltic states. These routes have limitations concerning the kinds of  equipment that can be transported through them, and availability is subject  to geopolitical complexities. For example, the PAKGLOC remained closed  for 8 months from 2011 to 2012 and did not become operational until  March 2013. Only about 4 percent of equipment return shipments flow  through the NDN, but the NDN routes proved critical for inbound cargo  during the PAKGLOC closure (see fig. 5). Airlift and multimodal movement  (air and sea) reduce the amount of time needed to return equipment, but  are substantially more expensive.
Route limitations will affect cost and time required for equipment  reduction. Transportation officials told us that when demands for return of  equipment increase in late 2013 and early 2014, it is unlikely that the  PAKGLOC will be able to fully support the demand. Officials stated that  equipment return may continue for some time after December 2014 due to  the volume of equipment remaining and the limited availability of assets  and capabilities to move it. Officials also anticipate that the physical limits  of transportation routes such as aerial port capacities could present a  constraint in the drawdown. TRANSCOM officials cautioned that, in the  future, it is possible that the volume of equipment to be returned could  exceed the capacity of the system.
Background  There are two types of transfers  of equipment in the Afghanistan  drawdown: those associated  with a base closure and those  independent of a base closure.
Subject to limitations, equipment  in Afghanistan may be  transferred within DOD and to  other federal agencies, U.S.  states, foreign countries, and  other recipients.
For transfers to Afghanistan  through the Foreign Excess  Personal Property program,  DOD has issued guidance  establishing who can approve  the transfer of certain equipment  by cost threshold. Transfers are  coordinated with the U.S.  Embassy team.
Equipment in Afghanistan that U.S. Central Command (CENTCOM)  determines to be no longer needed in the region and that the services and  Department of Defense (DOD) want to divest is either destroyed or  transferred to another U.S. agency, to U.S. states, to Afghanistan, to  another country, or to certain organizations. A number of factors are used  to determine whether equipment used in Afghanistan will be transferred,  including whether the equipment is in good condition; the needs of the  receiving organization or government; the ability of the recipient to sustain  the equipment; and the need to maintain critical timelines for base  closures and transfer actions. According to Army and Marine Corps  forecasts, the amount of equipment in Afghanistan that will be divested  (transferred or destroyed) is limited, and the majority will be returned (see  fig. 6). The ability to transfer equipment minimizes the need for in-country  destruction and could also avoid transportation charges when equipment  is not returned to the United States. In fiscal year 2012, the Army  estimated that transfers of excess equipment in Afghanistan resulted in  the avoidance of at least $1.2 billion in return transportation costs.
Transfer will be a limited option for the reduction of the equipment in  Afghanistan. According to CENTCOM officials, they have sufficient  authorities to transfer equipment to Afghanistan, surrounding countries,  and coalition partners. However, while DOD has been able to transfer  equipment such as heaters and air conditioners to Afghanistan, it faces  challenges in transferring more advanced equipment due to Afghanistan’s  limitations in absorbing and maintaining these items. Equipment used in  Afghanistan can also be transferred to U.S. state and local government  agencies, but these transfers may be limited by agencies’ having to  arrange and fund the transportation of the equipment out of Afghanistan.  In addition, Army officials said they may transfer some equipment once it  has been returned to the United States. This transfer would occur after  transportation costs have been paid through Overseas Contingency  Operations funds.
Background  The functions of DLA Disposition  Services include reutilizing end  items, selling or donating surplus  property, managing disposal of  hazardous property, and  coordinating the precious metals  recovery program. DLA Central’s  area of responsibility includes  Afghanistan, Kuwait, and Iraq, as  well as other Gulf States. Within  Afghanistan, it operates facilities  at Bagram, Kandahar, Camp  Leatherneck, and Camp John  Pratt, as well as at several other  sites. Protocols are in place to  prevent the destruction of  serviceable items unless  specifically authorized.
If the services choose to divest an item in Afghanistan, it is either  transferred or destroyed (demilitarized). The Defense Logistics Agency  (DLA) Disposition Services has established procedures and facilities  within Afghanistan to demilitarize the equipment. Demilitarization is the act  of destroying the military offensive or defensive capabilities inherent in  certain types of equipment or materiel. Demilitarization can be effected  through mutilation, dumping at sea, scrapping, melting, burning, or  alteration designed to prevent the further use of the equipment and  materiel for its originally intended military or lethal purpose.  Demilitarization applies equally to materiel in unserviceable or serviceable  condition that has been screened and declared excess to Department of  Defense (DOD) needs.
DLA Disposition Services charges the coalition forces on a per pound  basis for the services necessary to demilitarize an item and is currently  charging about 28 to 31 cents per pound. The price is generally based on  defraying the costs of overhead and operations, and it also considers that  sale of resulting scrap material will yield a certain amount of revenue.  Because this is a working capital fund operation, the military services pay  a rate adjusted proportionally for the amount of the service they receive.  Table 2 compares the price of demilitarizing listed items with the cost of  transporting the items to the Gulf Coast of the United States.
Potential Future Challenges   Space could be a limiting factor at DLA Disposition Services  demilitarization facilities in Afghanistan. A senior DLA Disposition Services  official said it is conceivable that demand for demilitarization or destruction  could exceed the capacity of facilities. To accommodate demand and flow,  DLA Disposition Services has created some flexibility by reprogramming  personnel from one task to another to match demands. A DLA Disposition  Services official also acknowledged that demilitarization or destruction  operations are likely to continue well after December 2014, noting that  such operations in Iraq continued into 2013.
section_title: Appendix VI: Comments from the Department of Defense
section_title: Appendix VII: GAO Contact and Staff Acknowledgments
subsections: section_title: GAO Contact
section_title: Staff Acknowledgments
paragraphs: In addition to the contact named above, individuals who made key  contributions to this report include: Guy LoFaro, Assistant Director;  Carolynn Cavanaugh; Carole Coffey; Timothy DiNapoli; Charles Johnson;  Cale Jones; Larry Junek; Anne McDonough-Hughes; Carol Petersen;  Terry Richardson; Michael Shaughnessy; Amie Steele; Jose Watkins;  Cheryl Weissman; Amanda Weldon; and Steve Woods.
section_title: Related GAO Products
paragraphs: Afghanistan: Key Oversight Issues. GAO-13-218SP. Washington, D.C.:  February 11, 2013.
Afghanistan Drawdown Preparations: DOD Decision Makers Need  Additional Analyses to Determine Costs and Benefits of Returning Excess  Equipment. GAO-13-185R. Washington, D.C.: December 19, 2012.
Warfighter Support: DOD Has Made Progress, but Supply and  Distribution Challenges Remain in Afghanistan. GAO-12-138.  Washington, D.C.: October 7, 2011.
Iraq Drawdown: Opportunities Exist to Improve Equipment Visibility,  Contractor Demobilization, and Clarity of Post-2011 DOD Role.  GAO-11-774. Washington, D.C.: September 16, 2011.
Defense Logistics: DOD Needs to Take Additional Actions to Address  Challenges in Supply Chain Management. GAO-11-569. Washington,  D.C.: July 28, 2011.
Warfighter Support: Preliminary Observations on DOD’s Progress and  Challenges in Distributing Supplies and Equipment to Afghanistan.  GAO-10-842T. Washington, D.C.: June 25, 2010.
Operation Iraqi Freedom: Actions Needed to Facilitate the Efficient  Drawdown of U.S. Forces and Equipment from Iraq. GAO-10-376.  Washington, D.C.: April 19, 2010.
Operation Iraqi Freedom: Preliminary Observations on DOD Planning for  the Drawdown of U.S. Forces from Iraq. GAO-10-179. Washington, D.C.:  November 2, 2009.
Iraq and Afghanistan: Availability of Forces, Equipment, and Infrastructure  Should Be Considered in Developing U.S. Strategy and Plans.  GAO-09-380T. Washington, D.C.: February 12, 2009.
Operation Iraqi Freedom: Actions Needed to Enhance DOD Planning for  Reposturing of U.S. Forces from Iraq. GAO-08-930. Washington, D.C.:  September 10, 2008.