Contingency Contracting: DOD, State, and USAID Continue to Face Challenges in Tracking Contractor Personnel and Contracts in Iraq and Afghanistan
Published: 2009-10-01T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: The Departments of Defense (DOD) and State and the U.S. Agency for International Development (USAID) have relied extensively on contractors to provide a range of services in Iraq and Afghanistan, but as GAO has previously reported, the agencies have faced challenges in obtaining sufficient information to plan and manage their use of contractors. As directed by the National Defense Authorization Act for Fiscal Year (FY) 2008, GAO analyzed DOD, State, and USAID data for Iraq and Afghanistan for FY 2008 and the first half of FY 2009 on the (1) status of agency efforts to track information on contracts and contractor personnel; (2) number of contractor personnel; (3) number of killed and wounded contractors; and (4) number and value of contracts and extent to which they were awarded competitively. GAO reviewed selected contracts and compared personnel data to other available sources to assess the reliability of agency-reported data.
section_title: What GAO Found
paragraphs: In response to a statutory requirement to increase contractor oversight, DOD, State, and USAID agreed to use the Synchronized Predeployment and Operational Tracker (SPOT) system to track information on contracts and contractor personnel in Iraq and Afghanistan. With the exception of USAID in Afghanistan, the agencies are in the process of implementing the system and require contractor personnel in both countries to be entered into SPOT. However, the agencies use differing criteria to decide which personnel are entered, resulting in some personnel not being entered into the system as required. Some agency officials also questioned the need to track detailed information on all contractor personnel, particularly local nationals. Further, SPOT currently lacks the capability to track all required data elements, such as contract dollar value and the number of personnel killed and wounded. As a result, the agencies rely on other sources for contract and contractor personnel information, such as periodic surveys of contractors. DOD, State, and USAID reported nearly 226,500 contractor personnel, including about 28,000 performing security functions, in Iraq and Afghanistan, as of the second quarter of FY 2009. However due to their limitations, the reported data should not be used to identify trends or draw conclusions about contractor personnel numbers. Specifically, we found that the data reported by the three agencies were incomplete. For example, in one quarterly contractor survey DOD did not include 26,000 personnel in Afghanistan, and USAID did not provide personnel data for a $91 million contract. The agencies depend on contractors to report personnel numbers and acknowledge that they cannot validate the reported information. USAID and State reported that 64 of their contractors had been killed and 159 wounded in Iraq and Afghanistan during our review period. DOD officials told us they continue to lack a system to reliably track killed or wounded contractor personnel and referred us to the Department of Labor's Defense Base Act (DBA) case data for this information. However, because DBA is a worker's compensation program, Labor's data include cases such as those resulting from occupational injuries and do not provide an appropriate basis for determining how many contractor personnel were killed or wounded while working on DOD, State, or USAID contracts in Iraq or Afghanistan. Nevertheless, the data provide insights into contractor casualties. According to Labor, 11,804 DBA cases were filed for contractors killed or injured in Iraq and Afghanistan during our review period, including 218 deaths. Based on our review of 150 randomly selected cases, we estimate that 11 percent of all FY 2008 DBA cases for the two countries resulted from hostile actions. DOD, State, and USAID reported obligating $38.6 billion on nearly 85,000 contracts in Iraq and Afghanistan during our review period. DOD accounted for more than 90 percent of the contracts and obligations. The agencies reported that 97 percent of the contracts awarded during our review period, accounting for nearly 71 percent of obligations, were competed.

section_title: Letter
paragraphs: The Departments of Defense (DOD) and State and the U.S. Agency for  International Development (USAID) have relied extensively on contractors  to support troops and civilian personnel and to oversee and carry out  reconstruction efforts in Iraq and Afghanistan. While the use of  contractors to support military operations is not new, the extent to which  the three agencies are relying on contractors in the two countries is  unprecedented—both in terms of the number of contractors and the range  of services they are providing. We and others have reported that the  agencies have faced challenges in obtaining information on contracts and  contractor personnel to plan and manage efforts in Iraq and Afghanistan.  Absent complete and accurate information on contractors supporting  contingency operations, the agencies are limited in their ability to develop  a complete picture of their reliance on contractors, the tasks being  performed, and their associated costs. The importance of such information  is heightened by the evolving U.S. efforts in the two countries as the  agencies reduce their presence in Iraq while expanding their presence in  Afghanistan. Reliable and meaningful data on contractors and the services  they provide are a starting point for agency decisions on when and how to  effectively use contractors; support contractors in terms of housing,  transportation, security, and other services; and ensure that contractors  are properly managed and overseen.
Congress has taken a number of actions to increase oversight of contracts  with performance in Iraq and Afghanistan. Among these, the National  Defense Authorization Act for Fiscal Year 2008 (NDAA for FY2008)  directed DOD, State, and USAID to sign a memorandum of understanding  (MOU) regarding matters relating to contracting in the two countries,  including maintaining common databases of information on contracts and  contractor personnel. In their July 2008 MOU, the agencies designated the  Synchronized Predeployment and Operational Tracker (SPOT) database as  their system of record for information on contracts and contractor  personnel working in Iraq and Afghanistan.
Congress directed us to annually review DOD, State, and USAID contracts  in Iraq and Afghanistan and report on these reviews through 2010. This is  our second report issued pursuant to that mandate. We are providing the  results of our analyses of agency-reported data for fiscal year 2008 and the  first half of fiscal year 2009 regarding (1) the agencies’ implementation of  SPOT, (2) the number of contractor personnel, including those performing  security functions, working on DOD, State, and USAID contracts with  performance in Iraq and Afghanistan, (3) the number of contractor  personnel killed or wounded, and (4) the number and value of contracts  that were active and awarded during our 18-month review period and the  extent of competition for new contract awards.
We used the following methodologies to develop our findings:    To assess SPOT’s implementation, we reviewed DOD, State, and USAID’s  MOU and interviewed officials responsible for implementing SPOT to  determine the agencies’ criteria and practices for entering information into  SPOT and the system’s current and planned capabilities. We reviewed  agency guidance and policy documents regarding the use of SPOT and  took training courses designed for personnel who expect to use the  system. We then compared the uses and capabilities of SPOT to the MOU  requirements to determine the extent to which SPOT fulfills the terms of  the MOU.
For the number of contractor personnel, we obtained DOD, State, and  USAID data on the number of U.S., third country, and local nationals  working on contracts in Iraq or Afghanistan, including those performing  security functions, during our review period. The agencies provided data  from surveys of their contractors as well as the SPOT database. We  assessed the reported data by comparing them to other available sources.  Based on comparisons of each source, we concluded that the agency- reported data should not be used to draw conclusions about the actual  number of contractor personnel in Iraq or Afghanistan or trends over time.  However, we are presenting the reported data along with their limitations  as they establish a minimum number of contractor personnel during our  period of review.
For contractor personnel killed or wounded during our review period, we  analyzed State and USAID data; DOD did not collect and could not provide  these data. We could not independently verify the completeness of the  data reported by USAID and State. However, we report State’s and  USAID’s data as they provide insight into the number of contractor  personnel who were killed or wounded during our review period. In  addition, we analyzed Department of Labor data on Defense Base Act  (DBA) cases for incidents in Iraq and Afghanistan during fiscal year 2008  and the first half of fiscal year 2009. We determined the DBA data were  sufficiently reliable for the purposes of this report based on our prior  reliability assessments. We also reviewed a random sample of 150 DBA  case files, from a population of 2,500 cases, for incidents that occurred  during fiscal year 2008 to determine, for example, whether the case was  the result of a hostile incident and the severity of the contractor’s injury.    For the contracts, we obtained data from DOD, State, and USAID on the  number of active and awarded contracts with performance in Iraq and  Afghanistan during our review period, the amount of funds obligated on  those contracts, and the extent of competition for new contract awards.  Data were provided from the Federal Procurement Data System – Next  Generation (FPDS-NG), agency-specific databases, and manually compiled  lists of contract actions. We determined that the data were sufficiently  reliable to determine the minimum number of active and awarded  contracts and obligation amounts, as well as the number of competed  contracts, based on our prior reliability assessments, interviews with  agency officials, and verification of some reported data.
A more detailed description of our scope and methodology is included in  appendix I. We conducted this performance audit from November 2008  through September 2009 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
paragraphs: Section 861 of the NDAA for FY2008 directed the Secretary of Defense, the  Secretary of State, and the USAID Administrator to sign an MOU related to  contracting in Iraq and Afghanistan. The law specified a number of issues  to be covered in the MOU, including the identification of each agency’s  roles and responsibilities for matters relating to contracting in Iraq and  Afghanistan, responsibility for establishing procedures for the movement  of contractor personnel in the two countries, responsibility for collecting  and referring information related to violations of the Uniform Code of  Military Justice (UCMJ) or the Military Extraterritorial Jurisdiction Act  (MEJA), and identification of common databases to serve as repositories  of information on contract and contractor personnel. The NDAA for  FY2008 requires the databases to track at a minimum:  for each contract,     a brief description of the contract,   its total value, and     whether it was awarded competitively; and  for contractor personnel working under contracts in Iraq or Afghanistan,  total number employed,  total number performing security functions, and  total number who have been killed or wounded.
DOD, State, and USAID signed the MOU in July 2008. The agencies agreed  that SPOT, a Web-based system initially designed and used by DOD, would  be the system of record for the statutorily-required contract and  contractor personnel information. The MOU specified that SPOT would  include information on DOD, State, and USAID contracts with more than  14 days of performance in Iraq or Afghanistan or valued at more than the  simplified acquisition threshold, which the MOU stated was $100,000, as  well as information on the personnel working under those contracts. In  contrast, the NDAA for FY2008 established a 14-day threshold for  inclusion in the database but did not specify a minimum dollar value.
As agreed in the MOU, DOD is responsible for all maintenance and  upgrades to the SPOT database. The agencies further agreed to negotiate  funding arrangements for any agency-unique requirements and for  specialized training requirements. Each agency is to ensure that data  elements related to contractor personnel, such as the number of personnel  employed on each contract in Iraq or Afghanistan, are entered into SPOT  and to require its contractors to enter that information accurately.  Information entered into SPOT is more detailed than the number of  contractor personnel as it is designed to track individuals by name and  record information such as the contracts they are working under,  deployment dates, and next of kin. Data elements, such as contract value  and whether it was awarded competitively, are to be imported into SPOT  from FPDS-NG, the federal government’s system for tracking information  on contracting actions.
section_title: SPOT Not Yet fully Implemented to Track Contractor Personnel and Contracts
paragraphs: While implementation of SPOT is still under way, DOD, State, and USAID’s  criteria for deciding which contractor personnel to enter into the system  differed from what was agreed to in the MOU and varied by country. This  has resulted in not all contractor personnel being entered into SPOT as  agreed to in the MOU. Further, SPOT currently does not have the  capability to track all of the required contract information or readily  generate reports on the total number of killed or wounded contractor  personnel.
subsections: section_title: Agency Implementation and Criteria for Using SPOT Varied
paragraphs: For the majority of our review period, DOD, State, and USAID were  phasing in the MOU requirement to use SPOT to track information on  contracts and the personnel working on them in Iraq and Afghanistan. In  January 2007, DOD designated SPOT as its primary system for collecting  data on contractor personnel deployed with U.S. forces and directed  contractor firms to enter personnel data for contracts performed in Iraq  and Afghanistan. State started systematically entering information for both  Iraq and Afghanistan into SPOT in November 2008. In January 2009,  USAID began requiring contractors in Iraq to enter personnel data into  SPOT. However, USAID has not yet imposed a similar requirement on its  contractors in Afghanistan and has no time frame for doing so.
In implementing SPOT, DOD’s, State’s, and USAID’s criteria for  determining which contractor personnel are entered into SPOT varied and  were not consistent with those contained in the MOU, as the following  illustrate.
Regarding contractor personnel in Iraq, DOD, State, and USAID officials  stated that the primary factor for deciding to enter contractor personnel  into SPOT was whether a contractor needed a SPOT-generated letter of  authorization (LOA). Contractor personnel need SPOT-generated LOAs to,  among other things, enter Iraq, receive military identification cards, travel  on U.S. military aircraft, or, for security contractors, receive approval to  carry weapons. However, not all contractor personnel, particularly local  nationals, in Iraq need LOAs and agency officials informed us that such  personnel were not being entered into SPOT. In contrast, DOD officials  informed us that individuals needing LOAs were entered into SPOT even if  their contracts did not meet the MOU’s 14-day or $100,000 thresholds.
For Afghanistan, DOD offices varied in their treatment of which contractor  personnel should be entered into SPOT. Officials with one contracting  office stated that the need for an LOA determined whether someone was  entered into SPOT. As in Iraq, since local nationals generally do not need  LOAs, they are not being entered into SPOT. In contrast, DOD officials  with another contracting office stated that they follow DOD’s 2007  guidance on the use of SPOT. According to the guidance, contractor  personnel working on contracts in Iraq and Afghanistan with more than  30 days of performance and valued over $25,000 are to be entered into  SPOT—as opposed to the MOU threshold of 14 days of performance or  valued over $100,000.
Agency officials have raised questions about the need to enter detailed  information into SPOT on all contractor personnel. Some DOD officials we  spoke with questioned the need to individually track all contractor  personnel as opposed to their total numbers given the cost of collecting  these detailed data compared to the benefit of having this information.  Similarly, USAID officials questioned the need to enter detailed  information as agreed to because personnel working on its contracts in  Afghanistan generally do not live or work in close proximity to  U.S. government personnel and typically do not receive support services  from the U.S. government. USAID officials also cited security concerns as  one factor affecting their decision on who should be entered into SPOT.  USAID officials explained that they have held off entering Iraqi or Afghan  nationals into SPOT because identifying local nationals who work with the  U.S. government by name could put those individuals in danger should the  system be compromised. To help address this concern, DOD officials said  that they have begun developing a classified version of SPOT. However,  USAID officials told us the agency would most likely not be able to use a  classified system due to limited access to classified computers.
Because of the varying criteria on who should be entered into the system,  the information in SPOT does not present an accurate picture of the total  number of contractor personnel in Iraq and Afghanistan. For example,  officials from all three agencies expressed confidence that the SPOT data  were relatively complete for contractor personnel who need an LOA in  Iraq. Conversely, agency officials acknowledged that SPOT does not fully  reflect the number of local nationals working on their contracts. Agency  officials further explained that ensuring that information on local nationals  is in SPOT is challenging because their numbers tend to fluctuate due to  the use of day laborers and because local firms do not always keep track  of the individuals working on their projects. DOD officials also explained  that they have had to develop workarounds to deal with the fact that SPOT  requires a first and last name to be entered for each individual along with a  birth date and unique identification number. The officials noted that many  Afghan laborers have only one name, do not know their birth dates, and  lack identification numbers.
section_title: SPOT Not Capable of Tracking All Required Information
paragraphs: SPOT currently lacks the capability to track all of the contract data  elements as agreed to in the MOU. While the MOU specifies that contract  values, competition information, and descriptions of the services being  provided would be pulled into SPOT from FPDS-NG, this capability is not  expected to be available until 2010. In the interim, the DOD officials  overseeing SPOT’s development told us that SPOT users can manually  enter competition information and descriptions, but there is no  requirement for them to do so. Since SPOT is not designed to let users  enter contract dollar values, the DOD officials stated that SPOT and FPDS- NG are being periodically merged to identify contract values.
Even when the direct link is established, pulling FPDS-NG data into SPOT  may present challenges because of how data are entered into SPOT. First,  information from the two systems can only be merged if the contract has  been entered into SPOT. If no contractor personnel working on a  particular contract have been entered, then the contract will not appear in  SPOT and its information cannot be linked with the information in FPDS- NG. Second, while contract numbers are the unique identifiers that will be  used to match records in SPOT to those in FPDS-NG, SPOT users are not  required to enter contract numbers in a standardized manner. In our  review of SPOT data, we determined that at least 12 percent of the  contracts had invalid contract numbers and, therefore, could not be  matched to records in FPDS-NG. Additionally, contract numbers may not  be sufficient to identify unique contracts. Specific orders placed on task  order contracts are identified through a combination of the contract  number and task order number. However, SPOT users are not required to  enter task order numbers. For example, one SPOT entry only contained  the contract number without an order number. In reviewing FPDS-NG  data, we determined that DOD had placed 12 different orders—ranging  from a few thousand dollars to over $129 million—against that contract.  Based on the information in SPOT, DOD would not be able to determine  which order’s value and competition information should be imported from  FPDS-NG.
SPOT, as currently designed, also lacks the capability to readily generate  reports on the number of killed or wounded contractor personnel. SPOT  was upgraded in January 2009 to fulfill the NDAA for FY2008 requirement  to track such information. Contractors can now update the status of their  personnel in the system, including whether they have been killed or  wounded, while agencies can run queries to identify the number of  personnel with a current status of killed or wounded. However, the  standard queries can only generate a list of personnel currently identified  as killed or wounded and cannot be used to identify individuals who  previously had the status of killed or wounded and whose records have  become inactive or whose injured status changed when they returned to  work. For example, if an individual has an injured status today and a query  were run, that individual would be included in the report. If that individual  then returned to work, the status would change and that individual would  not appear on any subsequent injury reports, with the agencies having no  means of determining whether the individual was ever injured.
section_title: DOD, State, and USAID Lack Reliable Data on Contractor Personnel in Iraq and Afghanistan
paragraphs: DOD, State, and USAID reported to us that there were 226,475 contractor  personnel, including 27,603 performing security functions, in Iraq and  Afghanistan as of the second quarter in fiscal year 2009. Over the period of  our review, DOD reported significantly more contractors than State and  USAID, most of whom were working in Iraq. For example, as of the second  quarter in fiscal year 2009, DOD reported over 200,000 contractor  personnel while State and USAID reported almost 9,000 and over 16,500,  respectively. However, due to limitations with the reported data, we  determined the data reported by the agencies should not be used to  identify trends or draw conclusions about the number of contractor  personnel in either country. Specifically, we found that personnel  information reported by the three agencies was incomplete and, for DOD,  additional factors raise questions about the reported numbers’ reliability.  Further, the agencies could not verify whether the reported data were  accurate or complete; although, they indicated that the data for certain  types of contractors, such as those providing security functions, were  more complete than other data, such as those for local nationals.
DOD Contractor Personnel  According to DOD officials, the most comprehensive information on the  number of DOD contractor personnel in Iraq and Afghanistan comes from  the U.S. Central Command’s (CENTCOM) quarterly census. CENTCOM  initiated its quarterly census of contractor personnel in June 2007 as an  interim measure until SPOT is fully implemented. The census relies on  contractor firms to report their personnel data to DOD components, which  then aggregate the data and report them to CENTCOM at the end of each  quarter. As shown in table 1, DOD’s reported number of contractor  personnel for our review period ranged from 200,111 to 231,698, with  approximately 7 percent performing security functions over the entire  period, on average.
DOD officials acknowledge that the census numbers represent only a  rough approximation of the actual number of contractor personnel that  worked in either country. Specifically, these officials told us that because  of how the data were collected and reported by the various DOD  components, it was difficult to compile and obtain an accurate count of  contractor personnel. We determined that over the course of our review  period the following data issues existed.
Contractor personnel information was sometimes incomplete. Most  notably, an Army-wide review of fiscal year 2008 third quarter census data  determined that the U.S. Army Corps of Engineers did not include  approximately 26,000 Afghan nationals working on contracts. However,  information on these contractors was included in subsequent censuses. As  a result, comparing third quarter and fourth quarter data would incorrectly  suggest that there was an increase in the number of contractors in  Afghanistan, when in fact the increase is attributable to more accurate  counting of personnel.
Contractor personnel were being double counted. For example, the system  used to record contractor personnel numbers for the Joint Contracting  Command-Iraq/Afghanistan was found to have duplicates. As a result,  DOD reported a 10 percent decrease in personnel in Iraq in the first  quarter of fiscal year 2009 and a 5 percent decrease in contractor  personnel in Afghanistan in the second quarter of fiscal year 2009 when  duplicates were removed.
The process used to collect data changed. For example, a 3 percent  decrease in personnel numbers reported in the first quarter of fiscal year  2009 compared to the previous quarter was attributed to the Joint  Contracting Command-Iraq/Afghanistan’s decision to begin using a  monthly data call to contractors to collect personnel numbers.
Data submitted by the DOD components were often of poor quality or  inaccurate, which created challenges for CENTCOM to compile quarterly  totals. During our review of quarterly census data submissions, we  identified a DOD component in Afghanistan that provided invalid contract  numbers for about 30 percent of its contracts in the second quarter for  fiscal year 2009. Also, it was not possible to determine for some  submissions how many contractors were working in a specific country. In  such cases, the CENTCOM official responsible for the census told us he  would either seek clarification from the DOD component that provided the  data or use his judgment to determine the correct personnel numbers.
subsections: section_title: State Contractor Personnel
paragraphs: In response to our request for information on its contractor personnel in  Iraq and Afghanistan, State officials informed us that prior to fiscal year  2009 the department did not systematically track contractor personnel.  Instead, State bureaus conducted periodic surveys of their contractors;  however, each bureau’s survey covered different time periods. Based on  these surveys, which at least one bureau supplemented with SPOT data,  State reported that 8,971 contractor personnel, the majority of whom  performed security functions, worked on contracts in Iraq and Afghanistan  during the first half of fiscal year 2009. Only one bureau provided  comparable information for fiscal year 2008, reporting 3,514 personnel  working on its contracts in Iraq and Afghanistan over the course of the  year.
Even relying on a combination of periodic surveys and SPOT, which State  implemented in fiscal year 2009, it appears that State underreported its  contractor personnel numbers. Specifically, in our analysis of State  contract and personnel data, we identified a number of contracts with  performance in Iraq or Afghanistan for which contractor personnel  numbers were not reported. For example, although State provided  obligation data on a $3 million contract for operation and maintenance  services in Iraq as well as a $5.6 million contract for support services in  Afghanistan, information on the number of personnel working on these  contracts was not contained in the agency’s periodic surveys or the SPOT  data we received.
section_title: USAID Contractor Personnel
paragraphs: For the personnel numbers reported to us, USAID relied entirely on  periodic surveys of its contractors. USAID provided contractor personnel  numbers for both Iraq and Afghanistan for all of fiscal year 2008 and the  first half of fiscal year 2009. The agency reported that 16,697 personnel,  including 5,097 performing security functions, worked on its contracts in  Iraq and Afghanistan during the first half of fiscal year 2009.
USAID relied on the results of surveys sent to its contractors in Iraq and  Afghanistan to respond to our request for contractor personnel  information. However, this information appeared to be incomplete.  Specifically, agency officials acknowledged the periodic surveys most  likely underreported the total number of contractor personnel. For  example, an official in Afghanistan informed us that if a USAID contractor  firm did not respond to a survey for personnel information, which is  sometimes the case since there is no contractual requirement to do so,  then personnel working for that firm were not included in the reported  numbers. Our analysis of USAID personnel and contract data also  indicates that USAID’s numbers are incomplete. Specifically, USAID  provided us with personnel data for about 83 percent of its contracts that  were active during the period of our review and had performance in Iraq  or Afghanistan. We identified a number of contracts for which contractor  personnel information was not provided, including contracts to refurbish a  hydroelectric power plant and to develop small and medium enterprises in  Afghanistan worth at least $6 million and $91 million, respectively.
section_title: Agency-Reported Data Not Verified but More Complete Than SPOT
paragraphs: DOD, State, and USAID could not verify the accuracy or completeness of  the contractor personnel data they provided to us, and officials  acknowledged that they are likely undercounting the actual number of  contractors working in Iraq and Afghanistan. Officials from the three  agencies stated they lack the resources to verify the information being  reported by their contractors, their primary source of data. Officials we  met with indicated this is particularly true for contracts that involve work  at remote sites, where security conditions make it difficult for U.S.  government officials to regularly visit. However, the agency officials stated  that personnel information on certain types of contractors is likely more  reliable than others. In particular, officials from DOD, State, and USAID  told us that the personnel numbers provided for their private security  contractors are the most accurate and reliable. This is due in part to the  increased scrutiny these contractors receive. Conversely, these same  officials told us obtaining accurate information on local nationals is  especially difficult. For example, one DOD official told us some local  national contractors hesitate or simply refuse to submit information on  their personnel because of safety concerns, among others. Further, the  number of local nationals working on a particular contract on a daily basis  can vary greatly depending on the type of work being performed.
Despite the limitations we identified with the agencies’ use of surveys, the  survey data were more complete than the data in SPOT for our review  period. For example, as shown in table 4, in the second quarter fiscal year  2009 census, DOD reported 83,506 more contractor personnel in Iraq and  Afghanistan than were entered into SPOT. An even smaller portion of  USAID’s contractor personnel were entered into SPOT because the agency  did not enter any personnel for any contracts in Afghanistan and was  generally not entering Iraqis into the system. While the difference between  SPOT and the surveys was smaller for State, there still were a number of  contracts for which personnel information was available from State’s  surveys but was not in SPOT.
section_title: Agencies’ Ability to Track Contractor Personnel Killed or Wounded in Iraq and Afghanistan Varies
paragraphs: Although USAID, State, and DOD are required to collect data on the total  number of contractor personnel who have been killed or wounded while  working on contracts in Iraq and Afghanistan, only USAID and State  tracked this information during our review period. USAID reported  59 contractor personnel were killed and 61 wounded during fiscal year  2008 and the first half of fiscal year 2009, while State reported that 5 of its  contractors were killed and 98 more were wounded (see table 5). These  data were based on reports submitted by contractors and then tracked by  the agencies. In tracking this information, USAID and State noted in some  cases, but not all, whether the death or injury was the result of a hostile  action or an accident. However, due to the lack of other available and  reliable sources, we could not independently verify whether USAID’s and  State’s data were accurate.
DOD officials informed us that their department continued to lack a  system for tracking information in a manner that would allow the  department to provide us with reliable data on killed or wounded  contractor personnel. Although DOD did not maintain departmentwide  data, some individual components within the department received reports  on killed or wounded contractor personnel. However, the components did  not consistently track these reports in a readily accessible or  comprehensive manner. For example, officials with the Defense Contract  Management Agency in Iraq and the Joint Contracting Command –  Iraq/Afghanistan explained that they received reports when contractor  personnel were killed or wounded, but this information was not recorded  in a manner that made it readily retrievable. In addition, an Army Corps of  Engineers official in Afghanistan told us that he tracked data on contractor  illnesses and injuries resulting from workplace accidents but did not track  data on contractor personnel killed or wounded as a result of hostile  incidents. Absent DOD-wide data and as was the case for our prior  report, DOD officials referred us to Defense Base Act (DBA) case data,  which are maintained by the Department of Labor, as a means of obtaining  information on killed and wounded contractor personnel.
subsections: section_title: Labor DBA Data Are Not a Good Proxy for Contractor Personnel Killed or Wounded
paragraphs: Labor’s DBA case data do not provide an appropriate basis for determining  the number of contractor personnel killed or wounded in Iraq and  Afghanistan while working on DOD, State, or USAID contracts. Under the  NDAA for FY2008, Labor—unlike DOD, State, and USAID—has no  responsibilities for tracking killed or wounded contractor personnel, and  as such, its data were not designed to do so. Instead, Labor maintains data  on DBA cases to fulfill its responsibilities for overseeing DBA claims by  providing workers’ compensation protection to contractor personnel  killed or injured while working on U.S. government contracts overseas,  including those in Iraq and Afghanistan.
After analyzing Labor’s DBA data and case files, we determined that DBA  data are not a good proxy for determining the number of killed and  wounded contractor personnel. This is, in part, because, as Labor officials  explained, not all deaths and injuries reported under DBA would be  regarded as contractors killed or wounded within the context of the NDAA  for FY2008. Many nonhostile-related deaths and injuries, such as strains,  sprains, and cases arising from auto accidents and other common  occupational injuries, are compensable under DBA and are routinely  reported to Labor. In addition, during our file reviews, we noted that many  cases, particularly those submitted for injuries, were for medical  conditions, such as pregnancy, cancer, and appendicitis, determined not to  be related to the individual’s employment in Iraq or Afghanistan, and  compensation claims for many of these cases were denied because the  conditions were not work-related. While employers must notify Labor of  all work-related contractor deaths and injuries resulting in time lost from  work, one Labor official told us that some employers report all medical- related conditions, regardless of their severity and the nature of the  incidents that caused them. In addition, some contractor deaths and  injuries may not be reported to Labor as required. In particular, Labor  officials have indicated that deaths and injuries to local and third-country  contractors may be underreported.
Additionally, because Labor does not track cases by agency or contract,  DBA data cannot be analyzed to determine how many cases involved  contractor personnel working specifically on DOD, State, or USAID  contracts. As a result, the data may include cases for contractor personnel  working for agencies other than DOD, State, and USAID. During our  review of 150 DBA case files, we noted that the files did not always  contain contract information and did not consistently identify the  contracting agency. While we identified 103 case files for personnel  working on DOD or State contracts, we did not identify any files for  USAID contractor personnel. In addition, 1 case file specified an agency  other than DOD, State, or USAID, while 46 files did not specify which  agency the contractor worked for.
Despite their limitations for determining the number of contractor  personnel killed or wounded, Labor’s DBA case data provide insight into  contractor personnel deaths and injuries in Iraq and Afghanistan.  According to Labor, there were 11,804 DBA cases, including 218 cases  reporting contractor deaths, which resulted from incidents that occurred  in Iraq and Afghanistan during fiscal year 2008 and the first half of fiscal  year 2009. As shown in table 6, overall both the total number of DBA cases  and the number of death cases decreased from fiscal year 2007 to fiscal  year 2008, though the number of death cases in Afghanistan increased.
Based on our review of 150 randomly selected DBA case files, we  estimated that about 11 percent of the deaths and injuries reported to  Labor for incidents that occurred in fiscal year 2008 resulted from hostile  actions. Only 16 of the 150 files we reviewed were for cases related to  hostile actions. Further, about one-third of the 11,586 DBA injury cases  that occurred during our review period resulted in the affected contractor  losing time from work. For example, we reviewed a case in which a  contractor lost time from work after receiving multiple injuries when an  ammunition pallet fell and wedged him against the side of a container,  while another contractor suffered fractures and spinal injuries caused by  an improvised explosive device and small arms fire.
section_title: DOD, State, and USAID Obligated Tens of Billions of Dollars on Contracts in Iraq and Afghanistan
paragraphs: DOD, State, and USAID reported obligating nearly $39 billion on 84,719  contracts with performance in Iraq and Afghanistan during fiscal year 2008  and the first half of fiscal year 2009 (see fig. 1 for obligation data). DOD  accounted for the vast majority of both the contracts and obligations.  Approximately two-thirds of the total number of contracts and obligations  were for performance in Iraq. Task orders were the most common  contract vehicle that the agencies used during our review period and  accounted for most of the obligations. A relatively small number of task  orders accounted for a large portion of each agency’s obligations. For  example, during our review period, DOD obligated more than $6.5 billion  on two task orders that provide food, housing, and other services for U.S.  military personnel, while more than a third of State’s obligations were on  three task orders for police training and criminal justice programs in Iraq  and Afghanistan. See appendix II for detailed information on each  agencies’ Iraq and Afghanistan contracts and obligations during our review  period.
The NDAA for FY2008 mandated that we identify the total number and  value of all contracts, defined to include prime contracts, task or delivery  orders, and subcontracts at any tier. While we obtained data on prime  contracts and orders, DOD, State, and USAID were unable to provide data  on the number or value of individual subcontracts. Contract files may  contain information on subcontracts, but none of the agencies  systematically tracked this information. The value of subcontracts is  captured in the total value of the prime contract, but the agencies were  unable to provide us with data on what portion of the total contract value  went to subcontractors.
Of the almost 85,000 contracts, including task and delivery orders, which  were active during our review period, 97 percent were awarded during  fiscal year 2008 and the first half of fiscal year 2009. However, more than a  third of the funds obligated during our review period were on contracts  originally awarded before fiscal year 2008. There were some variations  between the agencies, as shown in figure 2. For example, most of USAID’s  obligations were on contracts awarded prior to fiscal year 2008. In  contrast, most of State’s active contracts were awarded during our period  of review, but more than half the obligations were on a small portion of  previously awarded contracts.
subsections: section_title: Majority of New Contract Awards Were Competed
paragraphs: DOD, State, and USAID reported that they used competitive procedures to  award nearly all contracts awarded in our review period, with the  exclusion of task and delivery orders. Generally, contracts should be  awarded on the basis of full and open competition.The agencies reported  that most of their new contracts were awarded using full and open  competition, but in some cases the agencies reported a contract as  competed without indicating whether full and open or limited competition  occurred. The agencies reported that approximately 3 percent of contracts  awarded during our period of review, accounting for 29 percent of the  obligations, were not competed (see fig. 3).
Most of the 1,143 contracts reported to us as not competed had relatively  small obligations during our review period. Approximately 90 percent of  them had obligations of less than $100,000 and 80 percent had obligations  less than $25,000. In contrast, only 27 of the 1,143 contracts reported as  not competed had over $1 million in obligations. These 27 contracts  accounted for 99 percent of obligations for contracts that were not  competed.
The law authorizes agencies to use limited competition in certain  situations. There may be circumstances under which full and open  competition would be impracticable, such as when contracts need to be  awarded quickly to respond to urgent and compelling needs or when there  is only one source for the required product or service. In such cases,  agencies may award contracts without providing for full and open  competition (e.g., using limited competition or on a sole-source basis) if  the proposed approach is appropriately justified, approved, and  documented. Similarly, simplified acquisition procedures allow for limited  competition when awarding certain contracts, and the use of these  procedures is determined based on dollar thresholds contained in the  Federal Acquisition Regulation (FAR). These dollar thresholds vary  depending on where and for what purpose the contract was awarded and  performed, its dollar value, and the contracting method used. Additionally,  contracts valued below the micropurchase threshold, which is $25,000 for  contracts awarded and performed outside the United States in support of  contingency operations, may be awarded without soliciting competitive  quotations if the authorized purchase official considers the price to be  reasonable.
To determine the circumstances in which the agencies awarded contracts  using other than full and open competition, we reviewed 79 DOD and State  contracts awarded in fiscal year 2008 that had more than $100,000 in  obligations during our review period and were reported as not competed  or for which no competition information was provided. During our  review, we discovered that 8 of these had actually been awarded after a  full and open competition and 14 had been awarded after a limited  competition (i.e., they were not sole-source awards). Of the 71 files we  reviewed that were not awarded under full and open competition, the  most common justification for limiting competition or awarding a sole- source contract was that only one source could provide the good or  service being acquired. In some of these cases, the incumbent contractor  was awarded the new contract. For example, State awarded a sole-source  contract for communication equipment in Iraq because only one company  offered radios that were compatible with State’s existing communication  network. The second most common reason for limiting competition was  DOD’s enhanced authority to acquire products and services from Iraq and  Afghanistan. Congress granted DOD this authority, which allows DOD to  limit competition or provide preferences for products and services from  Iraq or Afghanistan, to provide a stable source of jobs and employment in  the two countries. According to DOD contracting officials in Iraq and  Afghanistan, they are increasing their use of this authority. However,  officials in Afghanistan explained that in doing so they generally have  some level of competition among local firms as opposed to doing a sole- source award. They explained that limited competitions are being  conducted to not only ensure better prices and products but also to help  instill Western business practices and develop local business capacity.
Competition requirements generally do not apply to the process of issuing  task and delivery orders. However, where there were multiple awardees  under the underlying contract, the FAR requires the contracting officer in  most instances to provide each awardee a fair opportunity to be  considered for each order exceeding $3,000. The agencies reported that  99 percent of the orders issued during our review period were competed.
section_title: Conclusions
paragraphs: Congress has directed DOD, State, and USAID to track specific  information regarding contractor personnel and contracts with  performance in Iraq and Afghanistan. Such data are a starting point for  providing decision makers with a clearer understanding of the extent to  which they rely on contractors and for facilitating oversight to improve  planning and better account for costs. Implementing SPOT, as agreed to in  the MOU, has the potential of providing the agencies and Congress with  data on contracts, contractor personnel, and those personnel who have  been killed or wounded. However, the agencies’ implementation of SPOT  currently falls short of that potential. Specifically, there is a lack of  consistency as to which contractor personnel are entered into SPOT. Not  withstanding the MOU, some agency officials have questioned the need or  feasibility of entering detailed information on individual contractor  personnel into SPOT beyond the requirement of the NDAA for FY2008 or  the MOU. Furthermore, SPOT does not currently have the capability to  accurately import contract data and its report generating capabilities limit  the agencies’ access to information that has been entered, particularly  with respect to killed or wounded contractor personnel. Until SPOT is  fully implemented, the agencies will continue to rely on multiple  alternative sources of data, which are also unreliable and incomplete, for  information related to contractor personnel and contracts in Iraq and  Afghanistan. As a result, the agencies and Congress will continue to be  without reliable information on contracts and contractor personnel to help  improve oversight and decision making at a critical juncture as agencies  draw down their efforts in Iraq and expand them in Afghanistan.
section_title: Recommendations for Executive Action
paragraphs: To ensure that the agencies and Congress have reliable information on  contracts and contractor personnel in Iraq and Afghanistan, we  recommend that the Secretaries of Defense and State and the USAID  Administrator jointly develop and execute a plan with associated time  frames for their continued implementation of the NDAA for FY2008  requirements, specifically    ensuring that the agencies’ criteria for entering contracts and contractor  personnel into SPOT are consistent with the NDAA for FY2008 and with  the agencies’ respective information needs for overseeing contracts and  contractor personnel;    establishing uniform requirements on how contract numbers are to be  entered into SPOT so that contract information can accurately be pulled  from FPDS-NG as agreed to in the MOU; and   revising SPOT’s reporting capabilities to ensure that they fulfill statutory  requirements and agency information needs, such as those related to  contractor personnel killed or wounded.
In developing and executing this plan, the agencies may need to revisit their  MOU to ensure consistency between the plan and what has previously been  agreed to in the MOU.
section_title: Agency Comments
paragraphs: We requested comments on a draft of this report from DOD, State, and  USAID. In its written comments, DOD did not agree with our  recommendation that the agencies jointly develop and execute a plan for  continued implementation of the NDAA for FY2008. According to DOD,  the current MOU, existing regulations, and ongoing coordination among  the agencies should be sufficient to meet legislative mandates. DOD noted  that additional direction beyond the implementation of the MOU may  require statutory action. DOD further explained that it is planning  upgrades to SPOT that may address some of the issues we identified,  particularly related to the entry of contract numbers and reporting  features. State, in its written comments, also disagreed with the need for  the agencies to develop and execute a plan to address the issues we  identified. Nevertheless, State acknowledged that the agencies need to  continue meeting to review their progress in complying with the NDAA for  FY2008, revisit the MOU, address issues to ensure consistency in meeting  the MOU criteria, and discuss SPOT’s future reporting capability. Similarly,  while USAID’s written comments did not address our overarching  recommendation for the agencies to develop and implement a plan or  indicate whether it agreed with the specific issues to be included in their  plan, it noted that it plans to continue regularly meeting with DOD and  State officials concerning the NDAA for FY2008 and the existing MOU.
We agree that coordination among the three agencies is critical, but given  the findings in this report, coordination alone is not sufficient. Instead, the  agencies need to take action to resolve the issues we identified in their  implementation of SPOT. In their comments the agencies recognized the  importance of having reliable information on contracts and contractor  personnel and acknowledged that corrective measures are needed.  However, the agencies did not explain in their comments how they plan to  translate their coordination efforts and upgrades into actions to resolve  the issues we identified. By jointly developing and executing a plan with  time frames, the three agencies can identify the concrete steps they need  to take and assess their progress in ensuring that the data in SPOT are  sufficiently reliable to fulfill the requirements of the NDAA for FY2008 and  their respective agency needs. Further, the extent to which the steps  necessary to implement the MOU and the recommended plan are  consistent with the NDAA for FY2008, no additional statutory action  would be required.
DOD’s, State’s and USAID’s comments, along with our supplemental  responses, are reprinted in appendixes III, IV, and V, respectively.
Additionally, we provided a draft of this report to Labor for its review and  comment. Labor provided technical comments that we incorporated into  the final report as appropriate.
We are sending copies of this report to the Secretary of Defense, the  Secretary of State, the Administrator of the U.S. Agency for International  Development, the Secretary of Labor, and interested congressional  committees. In addition, the report will be available at no charge on GAO's  Web site at http://www.gao.gov.
If you or your staff have any questions concerning this report, please  contact me at (202) 512-4841. 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 major contributions to this report are  listed in appendix VI.
section_title: Appendix I: Scope and Methodology
paragraphs: Section 863 of the National Defense Authorization Act for Fiscal Year 2008  directs GAO to review and report on matters relating to Department of  Defense (DOD), Department of State, and U.S. Agency for International  Development (USAID) contracts in Iraq and Afghanistan. In response to  this mandate, we analyzed agency-reported data for fiscal year 2008 and  the first half of fiscal year 2009 regarding (1) the status of the agencies’  implementation of the Synchronized Predeployment and Operational  Tracker (SPOT) database, (2) the number of contractor personnel,  including those performing security functions, working on DOD, State, and  USAID contracts with performance in Iraq and Afghanistan, (3) the  number of personnel killed or wounded, and (4) the number and value of  contracts that were active and awarded during our period of review and  the extent of competition for new contract awards.
subsections: section_title: Implementation of SPOT
paragraphs: To address our first objective, we reviewed DOD, State, and USAID’s July  2008 MOU relating to contracting in Iraq and Afghanistan and interviewed  DOD, State, and USAID officials responsible for implementing SPOT  regarding the current and planned capabilities of the system. We also  interviewed agency officials who use SPOT, including officials in Iraq and  Afghanistan, to determine the criteria the agencies use to determine what  information is entered into SPOT. We reviewed agency guidance and  policy documents regarding the use of SPOT and took training courses  designed for government and contractor personnel who expect to use the  system. We then compared the information we collected on the use and  capabilities of SPOT to the requirements identified in the agencies’ MOU  to determine the extent to which SPOT fulfilled the terms of the MOU.
section_title: Contractor Personnel
paragraphs: To address our second objective, we obtained data from DOD, State, and  USAID on the number of U.S. nationals, third-country nationals, and local  nationals working on contracts with performance in Iraq or Afghanistan in  fiscal year 2008 and/or the first half of fiscal year 2009. These data  included individuals reported to be performing security functions.
DOD reported data from the U.S. Central Command’s quarterly census and  SPOT for both fiscal year 2008 and the first half of fiscal year 2009. Of the  two sources, DOD officials said that the quarterly census was the most  complete source of information on contractor personnel. Given that and  the limitations we identified with SPOT, we used the quarterly census data  to develop our DOD-related findings for this objective.
State reported data gathered from periodic surveys of its contractors for  fiscal year 2008. For the first half of fiscal year 2009, State reported  contractor personnel information gathered from SPOT as well as through  surveys.
USAID reported data gathered from periodic surveys of its contractors for  fiscal year 2008 and the first half of fiscal year 2009. USAID also reported  SPOT data for some contracts with performance in Iraq for the first half of  fiscal year 2009.
We compared these data to the list of contracts we compiled to address  our objective on the number and value of agency contracts. Furthermore,  we interviewed agency officials regarding their methods for collecting data  to determine the number of contractor personnel, including those  providing security functions, in Iraq and Afghanistan. We also assessed the  completeness of the SPOT data that we received from each agency by  comparing them to data from other sources, such as the agency surveys.  Based on our analyses and discussions with agency officials, we  concluded that the agency reported data should not be used to draw  conclusions about the actual number of contractor personnel in Iraq or  Afghanistan for any given time period or trends in the number of  contractor personnel over time. However, we are presenting the reported  data along with their limitations as they establish a minimum number of  contractor personnel during our period of review.
section_title: Killed or Wounded Contractor Personnel
paragraphs: To address our third objective, we analyzed USAID and State data on the  number of contractor personnel killed or wounded in Iraq and Afghanistan  during the period of our review. DOD did not collect and could not provide  such data. USAID provided us with information on deaths and injuries it  had compiled from its implementing partners, including contractors.  Similarly, State provided data on contractors who were killed or wounded  based on reports from its contractors, which were compiled by  department personnel. Due to the lack of other available and reliable data  sources, we could not independently verify whether USAID’s and State’s  data were accurate. Nevertheless, we are providing them as they provide  insight into the number of contractor personnel who were killed or  wounded during our period of review. After informing us that they did not  have a reliable system for tracking killed or wounded personnel, DOD  officials referred us to use the Department of Labor’s data on Defense  Base Act (DBA) cases.
We analyzed data from Labor on DBA cases arising from incidents that  occurred in Iraq and Afghanistan in fiscal year 2008 or the first half of  fiscal year 2009. We obtained similar DBA data from Labor for our  previous report, for which we determined that the data were sufficiently  reliable, when presented with appropriate caveats, for providing insight  into the number of contractor personnel killed or wounded. As a result,  we did not reassess the reliability of the data we received for this report.  We also selected a random two-stage cluster sample of 150 DBA case files  from a population of 2,500 cases files submitted to Labor’s 10 district  offices for incidents that occurred during fiscal year 2008 and resulted in  the affected contractor losing time from work. Labor provided us with  DBA case data on all incidents that occurred in fiscal year 2008 through  February 26, 2009. Because there may be a lag between when an incident  occurred and when Labor was notified, we limited our sample to cases  arising from incidents that occurred in fiscal year 2008. As a result, the  findings from our file review are generalizable only to fiscal year 2008  cases. Labor provided us with a second data set for fiscal year 2008 and  the first half of fiscal year 2009 as of July 9, 2009, which included cases  that were in the first data set. The second data set included an additional  367 cases resulting from incidents that occurred in fiscal year 2008 that  were not in the population from which we drew our sample due to a lag in  when Labor was notified of the incidents. Because these additional cases  were within the scope of our review, we included them in the total number  of DBA cases presented in objective three; however, these cases were not  included in the population of cases from which we drew our random  sample.
The first stage of our sample selection was comprised of 5 clusters,  selected randomly with replacements, which came from 4 of the 10 Labor  district offices. In the second stage, we randomly selected 30 files from  each cluster. Thus, our final sample consisted of 150 DBA case files. We  reviewed these files to determine the circumstances of the incident  resulting in the death or injury, whether the incident was the result of a  hostile or nonhostile incident, and the severity of the contractor’s injury,  where applicable.
Because we followed a probability procedure based on random selections,  our sample is only one of a large number of samples that we might have  drawn. Since each sample could have provided different estimates, we  express our confidence in the precision of our particular sample’s results  as a 95 percent confidence interval (e.g., plus or minus 7 percentage  points). This is the interval that would contain the actual population value  for 95 percent of the samples we could have drawn. As a result, we are  95 percent confident that the confidence interval in this report will include  the true value in the study population.
section_title: Contracts
paragraphs: To address our fourth objective, we obtained data from DOD, State, and  USAID on the number of active and awarded contracts with performance  in Iraq and Afghanistan during fiscal year 2008 and the first half of fiscal  year 2009, the amount of funds obligated on those contracts during our  review period, and the extent to which new contracts were competitively  awarded. We also interviewed agency officials to discuss the reported  contract data. The agencies provided data from the Federal Procurement  Data System – Next Generation (FPDS-NG), agency specific-databases,  and manually compiled lists of obligations and deobligations. We  determined that the data each agency reported were sufficiently reliable to  determine the minimum number of active and awarded contracts and  obligation amounts, as well as the extent of competition, based on prior  reliability assessments, interviews with agency officials, and verification of  some reported data compared to information in contract files.
We took steps to standardize the agency-reported data and removed  duplicates and contracts that did not have obligations or deobligations  during our review period. DOD provided us with 32 separate data sets,  State provided 7, and USAID provided 9. The reported data included  multiple numbering conventions for each agency. We reformatted each  data set and combined them to create a single, uniform list of contracts,  orders, and modifications for each agency. We excluded the base  contracts under which task and delivery orders were issued. This was  done, in part, because such contracts do not have obligations associated  with them as the obligations are incurred with the issuance of each order.  We also excluded grants, cooperative agreements, and other contract  vehicles such as leases, sales contracts, and notices of intent to purchase  as these instruments do not include performance by contractor personnel  in Iraq or Afghanistan. For all contracts within our scope, we summed the  reported obligations for each contract and order for fiscal year 2008 and  the first half of fiscal year 2009. Some contracts had obligations in both  fiscal year 2008 and the first half of fiscal year 2009, so the number of  active contracts for the entire 18-month period was lower than the  combined number of contracts that were active in each fiscal year.
We reviewed contract files to identify the justification cited by the  agencies for not awarding the contract using full and open competition for  a subset of DOD and State contracts awarded in fiscal year 2008 that were  reported as not competed and that had total obligations during our review  period greater than $100,000. We did not review the files for all contracts  that met our criteria, in part, due to the location of some of the files. For  example, while we reviewed files located in Baghdad, Camp Victory,  Kabul, and Bagram Air Base, we did not review files for contracts located  in other areas of Iraq and Afghanistan. In total, we reviewed information  on 68 DOD contracts and 11 State contracts. At the time of our contract  file reviews, USAID had not reported any new contracts with obligations  over $100,000 as not competed. After our file reviews were completed,  USAID provided us with additional data, including data on two contracts  with obligations over $100,000 that were not awarded competitively. Due  to when we received these data, we did not review these two contracts.  However, we reviewed 12 other USAID contracts to verify the contract  information reported to us.
We conducted this performance audit from November 2008 through  September 2009 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.
section_title: Appendix II: DOD, State, and USAID Contracts in Iraq and Afghanistan
subsections: section_title: DOD Contracts
paragraphs: Table 7 shows all DOD contracts, along with the associated obligations,  reported to us as active in Iraq, Afghanistan, or both during fiscal year  2008 and the first half of fiscal year 2009. For last year’s review, DOD  reported obligating $18,996 million on 37,559 contracts in fiscal year 2007.
Table 8 provides information on the number of contracts awarded by DOD  and associated obligations made during our review period. The majority of  DOD’s active contracts were awarded during our review period and  70 percent of DOD’s obligations were made on the new contract awards.
Table 9 shows competition information for the DOD contracts (excluding  task and delivery orders) that were awarded during our review period.  DOD reported that 97 percent of its contracts were competed, including  33,143 (93 percent) that were awarded using full and open competition.  For 74 contracts, DOD either provided no competition information or what  was provided was not sufficient to determine whether the contract was  competed.
As shown in table 10, most of the DOD contracts reported as awarded  without competition had relatively small obligations during our review  period.
subsections: section_title: State Contracts
paragraphs: Table 11 shows all State contracts, along with the associated obligations,  reported to us as active in Iraq, Afghanistan, or both during fiscal year  2008 and the first half of fiscal year 2009. For last year’s review, State  reported obligating $1,550.4 million on 773 contracts in fiscal year 2007.
Table 12 provides information on the number of contracts awarded by  State and associated obligations made during our review period. The  majority of State’s active contracts were awarded during our review  period and 46 percent of State’s obligations were made on the new  contract awards.
Table 13 shows competition information for the State contracts (excluding  task and delivery orders) that were awarded during our review period.  State reported that 70 percent of its contracts were competed, including  358 (47 percent) that were awarded using full and open competition. For  10 contracts, State either provided no competition information or what  was provided was not sufficient to determine whether the contract was  competed.
As shown in table 14, most of the State contracts reported as awarded  without competition had relatively small obligations during our review  period.
section_title: USAID Contracts
paragraphs: Table 15 shows all USAID contracts, along with the associated obligations,  reported to us as active in Iraq or Afghanistan during fiscal year 2008 and  the first half of fiscal year 2009. For last year’s review, USAID reported  obligating $1,194.8 million on 190 contracts in fiscal year 2007.
Table 16 provides information on the number of contracts awarded and  associated obligations made during our review period. The majority of  USAID active contracts were awarded prior to our review period and  obligations on these previously awarded contracts accounted for nearly  79 percent of USAID’s obligations during fiscal year 2008 and the first half  of fiscal year 2009.
Table 17 shows competition information for the USAID contracts  (excluding task and delivery orders) that were awarded during our review  period. USAID reported that 90 percent of its contracts were competed,  including 126 (82 percent) that were awarded using full and open  competition. For 3 contracts, USAID either provided no competition  information or what was provided was not sufficient to determine whether  the contract was competed.
As shown in table 18, there were only 13 contracts that USAID reported as  awarded without competition and none had obligations greater than $1  million during our review period.
section_title: Appendix III: Comments from the Department of Defense
paragraphs: The following are GAO’s supplemental comments on the Department of  Defense's letter dated September 28, 2009.
subsections: section_title: GAO Comments
paragraphs: 1.  DOD cites the number of contractor personnel in SPOT for the entire  CENTCOM area of responsibility, which extends beyond Iraq and  Afghanistan. Consistent with our mandate, we report 117,301 DOD  contractor personnel identified in SPOT as being in Iraq or Afghanistan  as of March 31, 2009. However, we did not use SPOT as our primary  data source for contractor personnel data. We found that the quarterly  census was a more comprehensive source—containing approximately  84,000 personnel more than SPOT as of March 31, 2009 for Iraq and  Afghanistan.   2.  In signing the MOU, DOD agreed to track contractor personnel in Iraq  or Afghanistan if their contract is more than 14 days or over $100,000.  As described in its comments, however, DOD’s regulations contain  different thresholds on which contractors should be entered into  SPOT. In practice, we found that that the need for an LOA—rather  than the thresholds in the MOU or DOD’s regulations—served as the  primary determinate as to whether or not a contractor was entered in  SPOT. These variations reinforce our finding and recommendation that  the agencies ensure they have consistent criteria—both in policy and  practice—on which contractor personnel are entered into SPOT.  3.  DOD’s comments recognize the need to develop a standardized  contract field in SPOT. However, any effort to create a standardized  field needs to involve DOD, State, and USAID to ensure consistency  with their contract numbering systems and a common understanding  of how data must be entered into the system. Further, each agency  must ensure that the way contract and task order numbers are entered  into SPOT are identical with how those numbers are entered into  FPDS-NG.   4.  Our report recognizes that SPOT was upgraded in January 2009 to  track contractor personnel who have been killed or wounded. As  discussed in the report, however, this upgrade does not provide  agencies with the capability to readily generate reports on the total  number of contractor personnel killed or wounded within a given  timeframe; instead, the current capability is limited to generating a  report of personnel identified as killed or wounded on the day the  report is generated. DOD does not specify in its comments as to  whether or how the planned November 2009 upgrade would address  this reporting limitation. Also, it is not clear from DOD’s comments as  to whether this planned upgrade will apply to both the unclassified and  classified versions of SPOT. State’s comments suggest that based on  information it received from DOD, the improved reporting features will  be limited to the classified version.
section_title: Appendix IV: Comments from the Department of State
paragraphs: Department of State Comments on GAO Draft Report  CONTINGENCY CONTRACTING:  DOD, State, and USAID Continue to  Face Challenges in Tracking Contractor Personnel and Contracts in Iraq and   (GAO-10-01, GAO Code 120790)
The Department of State appreciates the opportunity to review the  Government Accountability Office (GAO) draft report titled, “Contingency  Contracting:  DOD, State and USAID Continue to Face Challenges in Tracking  Contractor Personnel and Contracts in Iraq and Afghanistan.”
Recommendation:  To ensure that the agencies and Congress have reliable  information on contracts and contractor personnel in Iraq and Afghanistan, we  recommend that the Secretaries of Defense and State and the Administrator of  USAID jointly develop and execute a plan with associated timeframes for their  continued implementation of the NDAA for FY2008 requirements, specifically   Ensuring that the agencies’ criteria for entering contracts and contractor  personnel into the Synchronized Predeployment and Operational Tracker (SPOT)  are consistent with the National Defense Authorization Act (NDAA) for FY2008  and with the agencies’ respective information needs for overseeing contracts and  contractor personnel;    Establishing uniform requirements on how contract numbers are to be  entered into SPOT so that contract information can accurately be pulled from  FPDS-NG as agreed to in the MOU; and    Revising SPOT’s reporting capabilities to ensure that they fulfill statutory  requirements and agency information needs, such as those related to contractor  personnel killed or wounded.   In developing and executing this plan, the agencies may need to revisit their MOU  to ensure consistency between the plan and what has previously been agreed to in  the MOU.
Response:  The Bureau of Administration (A) has the lead on agency  implementation of SPOT and the NDAA.  We acknowledge the importance of  reliable information on contracts and contractor personnel in Iraq and Afghanistan  reported jointly with the Secretary of Defense (DOD) and the Administrator of  USAID to implement NDAA FY2008 requirements.  We agree that the agencies  need to continue to meet to review progress and intent of the MOU to comply with  NDAA FY2008, but do not agree with the recommendation that a new plan needs  to be developed.  We do agree that the current MOU needs to be revisited as well  as some issues to ensure consistency meeting the criteria it already contains as  specified in NDAA 2008, section 861. “regarding contractor personnel in Iraq, DOD, State, and USAID officials stated that the  primary factor for deciding to enter contractor personnel into SPOT was whether a  contractor needed a SPOT-generated letter of authorization (LOA). Contractor personnel  need SPOT-generated LOAs to, among other things, enter Iraq, receive military  identification cards, travel on U.S. military aircraft, or, for security contractors, receive  approval to carry weapons. However, not all contractor personnel, particularly local  nationals, in Iraq need LOAs and agency officials informed us that such personnel were  not being entered into SPOT.  In contrast, DOD officials informed us that individuals  needing LOAs were entered into SPOT even if their contracts did not meet the MOU’s 14  day or $100,000 thresholds.”
State personnel advised the GAO during an interview that company  administrators were told verbally and in writing to enter all United States citizens,  Third Country Nationals, and Locals Nationals into SPOT.  Due to security  concerns about entering data on Local Nationals, company administrators were  given a blind identity scheme to aid with accountability of entering the  information.  We continue to urge that actual information be entered on all Local  Nationals because SPOT would be used for NDAA 1248, repatriation requests.
Also, the MOU signed by the three agencies stipulate that contracts under  the simplified acquisitions threshold of $100,000 and 14 working days would not  be entered into SPOT (Section VII B).  The GAO was advised by State personnel  during the interview that it lacked resources to enter every acquisition into SPOT  and support the higher threshold.  However, there may be confusion because an  earlier Section II A of the MOU only states “longer than 14 days”.  We agree that  the three agencies need to discuss this issue to determine one standard. “while contract numbers are the unique identifiers that will be used to match records in  SPOT to those in FPDS-NG, SPOT users are not required to enter contract numbers in a  standardized manner. In our review of SPOT data, we identified that at least 12 percent of  the contracts had invalid contract numbers and, therefore, could not be matched to  records in FPDS-NG.”
When implementing SPOT, State used the configuration guidance which  complies with FPDS-NG given by DOD to enter all contract numbers.  The user  guide posted on the Department’s intranet was shared with GAO; the business  rules in it state the configuration to be used when entering a contract number into  SPOT.  We contacted DOD on September 9, 2009, and they informed us they are  already working on a standardized configuration.
Recently, DOD conducted user acceptance testing for implementation of  enhanced reporting in SPOT, but we were told it would only be on its secure  network.   However, all the information input to date into SPOT is in an  unclassified network.  The agencies need to discuss future reporting capability for  non-classified SPOT.
The following are GAO’s supplemental comments on the Department of  State’s letter dated September 24, 2009.
subsections: section_title: GAO Comments
paragraphs: 1.  Notwithstanding State’s guidance to contractors, we found that not all  contractor personnel are being entered into SPOT as required. In  practice, we found that the need for an LOA is the primary determinate  for whether or not contractor personnel are entered into SPOT. For  example, a State contracting officer informed us that Iraqis working on  his contracts are not in SPOT because they do not need LOAs, which is  not consistent with State’s guidance, the MOU criteria, or the NDAA  for FY2008.  2.  As reflected in our recommendation, we agree that the agencies need  to determine a single standard on which contracts should be entered  into SPOT. This is not only due to State’s observation regarding  inconsistencies in the MOU, but also due to the inconsistencies we  found between the MOU and NDAA for FY 2008 and the varying  criteria being used by the agencies. Until there is a single agreed upon  standard—both in guidance and practice, the agencies will continue  track data differently and, as a result, the data for all three agencies  will be incomplete.   3.  Our finding pertained to how data are actually being entered into  SPOT, which as we report allows users to enter invalid contract  numbers and does not require the entry of task order numbers. For  example, we found that none of State’s task orders in SPOT provided  both the contract and task order numbers. If such data entry issues are  not resolved in the near future, then the planned connection with  FPDS-NG may present challenges and prevent contract data from  being accurately imported into SPOT.
section_title: Appendix V: Comments from the U.S. Agency for International Development
paragraphs: The following are GAO’s supplemental comments on USAID’s letter dated  September 22, 2009.
subsections: section_title: GAO Comments
paragraphs: 1.  While building off the lessons learned in Iraq has merit, we note that  USAID does not provide a time frame for when it will begin requiring  contractors in Afghanistan to use SPOT to fulfill the requirements of  the NDAA for FY2008 and what it agreed to in the MOU.  2.  Our report explains that the need for the LOA—as opposed to what  was agreed to in the MOU or contained in the NDAA for FY2008—has  become the primary factor for determining which contractor personnel  are entered into SPOT. USAID’s comment that it will explore SPOT’s  functionality to track personnel who do not need LOAs is consistent  with our recommendation that the agencies work together to ensure  that the requirements of the NDAA for FY2008 and their respective  information needs are fulfilled. 3.  While USAID has a standard contract numbering system, the issue we  identified pertains to how SPOT allows contract and task order  numbers to be entered inconsistently. The agencies need to work  together to ensure that contract and task orders numbers are entered  into SPOT so that data can be accurately pulled from FPDS-NG.  4.  While DOD is responsible for maintaining and upgrading SPOT, the  three agencies have a shared responsibility to ensure that the database  they agreed to use in their MOU fulfills the requirements of the NDAA  for FY2008. Rather than deferring to DOD as the system owner to  manage SPOT’s development, USAID should work with the other  agencies to identify and agree on their information and reporting needs  and ensure that the necessary upgrades are made to SPOT.
section_title: Appendix VI: GAO Contact and Staff Acknowledgments
subsections: section_title: GAO Contact
paragraphs: John Hutton, (202) 512-4841 or huttonj@gao.gov.
section_title: Acknowledgments
paragraphs: In addition to the contact above, Johana R. Ayers, Assistant Director; Noah  Bleicher; E. Brandon Booth; Justin Fisher; Art James, Jr.; Christopher  Kunitz; Jean McSween; Alise Nacson; Jason Pogacnik; Karen Thornton;  Gabriele Tonsil; and Robert Swierczek made key contributions to this  report.