Warfighter Support: Continued Actions Needed by DOD to Improve and Institutionalize Contractor Support in Contingency Operations
Published: 2010-03-17T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: The Department of Defense (DOD) relies greatly on contractors to support its current operations and is likely to continue to depend on contractors in support of future operations. As of December 2009, DOD estimated that over 207,000 contractor personnel were supporting operations in Iraq and Afghanistan. DOD expects to increase the number of contractors as more troops deploy to Afghanistan. The use of contractors in contingencies has challenged DOD in overseeing and managing contractors. This testimony addresses (1) the challenges DOD faces when trying to provide management and oversight of contractors in Iraq and Afghanistan, and (2) the extent to which DOD has made progress in institutionalizing a department- wide approach to managing and overseeing operational contract support. Today's testimony is based on GAO's ongoing audit work in Iraq and Afghanistan, looking at planning for operational contract support and at DOD's efforts to manage and oversee contractors, as well as on recently published related GAO reports and testimonies.
section_title: What GAO Found
paragraphs: DOD continues to face a number of challenges overseeing and managing contractors in ongoing operations. These challenges include: (1) Providing an adequate number of personnel to conduct oversight and management of contractors. (2) Training personnel, including non-acquisition personnel such as unit commanders, on how to work effectively with contractors in operations. (3) Ensuring that local and third-country nationals have been properly screened, given the lack of standardized documents, the lack of national police agencies in many countries, and poor record keeping in many countries. (4) Compiling reliable data on the number of contractor personnel supporting U.S. forces in contingencies. (5) Identifying requirements for contractor support in ongoing operations, although GAO notes that some steps have been taken at the individual unit level.
section_title: What GAO Recommends
paragraphs: GAO has made many recommendations in the past aimed at addressing each of these challenges. While DOD has implemented some of our recommendations, it has been slow to implement others. For example, DOD has not developed agency-wide procedures to screen foreign national contractor personnel. In addition, the department has not fully addressed congressional direction to include operational contract support in predeployment training. Until DOD has fully implemented GAO's recommendations and congressional direction, it will not be in a position to ensure adequate management and oversight of contractors in contingency operations. Furthermore, inattention to these challenges may negatively affect the military's mission through the inefficient use of personnel, may increase the risk to U.S. personnel through inadequate background screenings, and may result in increased waste of taxpayer dollars. While DOD has taken some actions to institutionalize operational contract support, significant work remains to be done. For example, in 2006 DOD established the Assistant Deputy Under Secretary of Defense (Program Support) to act as a focal point for DOD's efforts to improve contract management and oversight at deployed locations. In addition, the department has issued a variety of contractor-related guidance, including the Joint Contingency Contracting Handbook and a Joint Publication that establishes doctrine for operational contract support; however, other guidance, including an Expeditionary Contracting Policy and an update of the DOD Instruction on Contractors Accompanying the Force, has yet to be finalized. Our ongoing work has also shown that the department continues to face challenges identifying contractor requirements in its plans for future operations. Until DOD institutionalizes operational contract support by incorporating it into its guidance, training, and planning, the department may continue to confront the challenges it faces in Iraq and Afghanistan in future operations.

section_title: Letter
paragraphs: I appreciate the opportunity to be here today to discuss a number of issues  regarding the oversight and management of contracts used to support U.S.  forces in contingency operations, which constitute a key portion of the  broader issues the department refers to as operational contract support.  As you know, the Department of Defense (DOD) relies greatly on  contractors to support its missions and operations, due in part to such  factors as the reductions in DOD’s civilian and military personnel  following the collapse of the Soviet Union, the increasing complexity of  weapons systems, and more recently, the increased demands related to  overseas contingency operations, such as the need for large numbers of  Arabic speakers. DOD officials have stated that without a significant  increase in its civilian and military workforce, the department is likely to  continue to rely on contractors both in the United States and overseas in  support of future deployments. For example, the Deputy Under Secretary  of Defense for Logistics and Materiel Readiness testified in 2008 that the  structure of the U.S. military had been adapted to an environment in which  contractors were an indispensable part of the force. In that regard, DOD  estimates that more than 207,000 contractor personnel were supporting  operations in Iraq and Afghanistan as of December 2009, and DOD  anticipates that this number will grow as the department increases its  troop presence in Afghanistan.
Congress has enacted legislation requiring DOD to take specific actions to  improve its management and oversight of contractors in contingencies,  such as (1) improving contractor accountability; (2) developing joint  policies for requirements definition, contingency program management,  and contingency contracting during combat and post-conflict operations;  and (3) developing policies and procedures for the use of private security  contractors in contingency operations. Our previous work has highlighted  long-standing problems regarding the oversight and management of  contractors supporting deployed forces. Since the advent of our work on  contractor support to deployed forces in 1997, we have made many  recommendations to improve DOD’s management of contractors in  deployed locations. While the department has implemented some of our  recommendations, it has been to slow to implement others, including  those recommendations related to operational contract support training  for commanders and other personnel responsible for the management and  oversight of contractors. Further, in part because of the lack of an  adequate number of trained acquisition and contract oversight personnel,  GAO has designated DOD contract management as a high-risk area.
The government contracting process consists of three phases: contract  planning, contract formation, and contract management. The contract  planning phase includes requirements determination, in which specific  requirements and specifications for contracted products and services are  identified and validated. The contract formulation phase typically involves  solicitation and evaluation of offers and the award of a contract. Finally,  the contract management phase begins after the contract is awarded. Post- award activities include contract oversight and management, contract  completion and close-out activities. The contracting process is governed  by contracting laws, rules, and guidance, such as the Federal Acquisition  Regulation, as well as specific policies established by DOD on how to  administer and manage contracts that support contingency operations,  such as Joint Publication 4-10 and DOD Instruction 3020.41. DOD has  acknowledged shortcomings in how the role of contractors was addressed  in its planning for Iraq and Afghanistan, and has taken some recent actions  to improve contracting and issue guidance.
In view of this, my statement today will focus on (1) the challenges DOD  faces when trying to provide management and oversight of contractors in  Iraq and Afghanistan; and (2) the extent to which DOD has made progress  in institutionalizing a department-wide approach to managing and  overseeing operational contract support. I will conclude with some  observations about further actions the department could take to improve  its use of contractors in contingency operations. My statement is based on  recently published related reports and testimonies and reflects preliminary  observations drawn from ongoing work looking at planning for operational  contract support and the department’s efforts to manage and oversee  contractors in Afghanistan and Iraq. Our work was conducted in  accordance with generally accepted government auditing standards.
subsections: section_title: Background
paragraphs: The U.S. military has long used contractors to provide supplies and  services to deployed U.S. forces, and more recently contractors have been  involved in every major military operation since the 1991 Gulf War.  However, the scale of contractor support DOD relies on today in Iraq and  throughout Southwest Asia has increased considerably from what DOD  relied on during previous military operations, such as Operations Desert  Shield/Desert Storm and those in the Balkans. At the end of the first  quarter of fiscal year 2010, DOD estimated the number of contractors in  Iraq to be about 100,000 and the number in Afghanistan about 107,000. In  both Iraq and Afghanistan, U.S. citizens constitute a minority of the total  contractor workforce. In Iraq, approximately 72,000 contractors are third  country or Iraqi nationals, and in Afghanistan approximately 81,000  contractors, or 75 percent, are Afghan nationals. However, these numbers  do not reflect the thousands of contractors in Kuwait and elsewhere who  support operations in Iraq and Afghanistan. By way of contrast, an  estimated 9,200 contractor personnel supported military operations in the  1991 Gulf War. Factors that have contributed to the increase include  reductions in the size of the military, an increase in the number of  operations and missions undertaken, and DOD’s use of increasingly  sophisticated weapons systems.
DOD uses contractors to meet many of its logistical and operational  support needs during combat operations, peacekeeping missions, and  humanitarian assistance missions. Today, contractors located throughout  the Middle East and Southwest Asia provide U.S. forces with such services  as linguistic support, equipment maintenance, base operations support,  and security support. In Iraq and Afghanistan, contractors provide  deployed U.S. forces with communication services; interpreters who  accompany military patrols; base operations support (e.g., food and  housing); weapons systems maintenance; intelligence analysis; and a  variety of other types of support. Contractors provide logistics support  that includes parts and equipment distribution, ammunition accountability  and control, port support activities, and support to weapons systems and  tactical vehicles. For example, in Kuwait, Iraq, Qatar, and Afghanistan, the  Army uses contractors to refurbish, repair, and return to the warfighters a  variety of military vehicles.
Oversight of contracts—which can refer to contract administration  functions, quality assurance surveillance, corrective action, property  administration, and past performance evaluation—ultimately rests with  the contracting officer, who has the responsibility for ensuring that  contractors meet the requirements as set forth in the contract. Frequently,  however, contracting officers are not located in the contingency area or at  the installations where the services are being provided. As a result,  contracting officers appoint contract monitors, who are responsible for  monitoring contractor performance. For some contracts, such as  LOGCAP, AFCAP, or theater-wide service contracts like the Afghan  trucking contract, contracting officers may delegate contract oversight to  the Defense Contract Management Agency (DCMA) to monitor contractor  performance. In Iraq and Afghanistan, these teams include administrative  contracting officers, who direct the contractor to perform work, and  quality assurance representatives, who ensure that the contractors  perform work to the standards written in the contracts and oversee the  Contracting Officer’s Representatives (CORs) assigned to DCMA- administered contracts. The DCMA team also includes property  administrators and subject matter experts who advise the agency on  technical issues such as food service, electrical engineering, and air traffic  control procedures. These subject matter experts augment the DCMA  staff and provide expertise not inherent to DCMA’s workforce and  normally outside of DCMA’s core competency area of oversight  responsibilities. Unless the contracting officer delegates the administrative  contract management and oversight functions to DCMA, the contracting  officer is responsible for the administrative oversight and management of  the contract.
Regardless of whether or not DCMA provides administrative oversight of a  contract, contracting officers generally appoint CORs. These individuals  provide much of the day-to-day oversight of a contract during a  contingency operation. They are typically drawn from units receiving  contractor-provided services, they are not normally contracting  specialists, and often their service as contracting officer’s representatives  is an additional duty. They cannot direct the contractor by making  commitments or changes that affect price, quality, quantity, delivery, or  other terms and conditions of the contract. Instead, they act as the eyes  and ears of the contracting officer and serve as the liaison between the  contractor and the contracting officer. In Iraq and Afghanistan, CORs who  have been appointed as contracting officer’s representatives for contracts  administered by DCMA report their oversight results to DCMA personnel.  For contracts not administered by DCMA, CORs provide oversight  information to the contracting officer, who may be located in Iraq,  Afghanistan, or outside the theater of operations.
DOD guidance requires that trained CORs be appointed prior to the award  of a service contract. In Iraq and Afghanistan, the Joint Contracting  Command requires that its contracting officers appoint CORs for all  contracts valued at more than $2,500 and having significant technical  requirements that require on-going advice and surveillance from  technical/requirements personnel. The contracting officer may exempt  service contracts from this requirement when the following three  conditions are all met:  1. The contract is awarded using simplified acquisition procedures;  2. The requirement is not complex; and  3. The contracting officer documents the file, in writing, as to why the  appointment of a COR is unnecessary.
section_title: DOD Continues to Face Challenges in Providing Management and Oversight of Contractors in Ongoing Operations
paragraphs: Based on preliminary observations from our ongoing work in Iraq and  Afghanistan, we found that DOD continues to be faced with five challenges  related to providing management and oversight of contractors in ongoing  operations. First, DOD continues to be challenged in having an adequate  number of personnel to provide oversight and management of contracts.  While DOD has acknowledged shortages of personnel and has made some  efforts to address them, these efforts are in the early stages of  implementation. Second, training non-acquisition personnel such as CORs  and unit commanders to work with contractors continues to be a problem.  For example, we found some instances in which a lack of training raised  concerns over the potential risk of military commanders directing  contractors to perform work outside the scope of the contract—something  commanders lack the authority to do. Third, DOD continues to face  badging and screening challenges, particularly of local national and third- country national contractor personnel. Fourth, DOD lacks reliable  tracking data on contractor personnel in Iraq and Afghanistan. Fifth, DOD  faces challenges in identifying its operational contract support  requirements for ongoing operations in Iraq and Afghanistan. For instance,  officials from U.S. Forces-Afghanistan’s logistics staff appeared to be  unaware of their responsibility as defined by DOD guidance to identify  contractor requirements or develop the contract management and support  plans required by guidance.
subsections: section_title: Challenges in Providing an Adequate Number of Contract Oversight and Management Personnel in Deployed Locations Are Likely to Continue to Hinder DOD’s Oversight of Contractors
paragraphs: As we noted in several of our previous reports, having the right people  with the right skills to oversee contractor performance is crucial to  ensuring that DOD receives the best value for the billions of dollars spent  on contractor-provided services supporting contingency operations.  Additionally, as our previous work has shown, poor contract oversight and  the poor contractor performance that may result can negatively affect the  military’s mission. Although we could find no DOD guidelines regarding  the appropriate number of personnel needed to oversee and manage DOD  contracts at a deployed location, several reviews by GAO and DOD  organizations have consistently found significant deficiencies in DOD’s  oversight of contractors due to having an inadequate number of personnel  to carry out these duties. In 2004, 2006, and again in 2008, we reported  on DOD’s inability to provide an adequate number of oversight personnel  in CENTCOM’s theater of operation, and our ongoing work in Afghanistan  and Iraq demonstrates that this problem has not been resolved. For  example,    During our December 2009 trip to Afghanistan, officials at a  contracting command told us that their workload required them to  devote all their efforts to awarding contracts, and as a result they  could not provide contract oversight.
During that same trip, the commander of a maintenance battalion in  Afghanistan expressed concern over having an inadequate number of  personnel available to provide oversight of a key maintenance contract  used to support the increase of troops in Afghanistan. He noted that  the lack of sufficient quality assurance personnel and technical experts  was an identified problem they were working to correct, but that the  additional civilian personnel were slow to arrive. Furthermore, he  expressed concern that the expanding U.S. mission in Afghanistan  would require additional technical experts and quality assurance  personnel to oversee the increased number of contractors expected to  be needed to support the increased vehicle maintenance and repair  requirements.
In preliminary findings concerning the drawdown of forces from Iraq,  we noted that an Army unit in Kuwait that was responsible for  ensuring the steady flow of equipment out of Kuwait and for  conducting certain maintenance tasks had 32 government personnel to  provide oversight for more than 3,000 contractor personnel. In January  2010, Army Materiel Command requested funding to double to  approximately 800 the number of this unit’s contractor personnel  assigned to conduct retrograde-specific tasks—for example, receiving,  accounting for, sorting, and moving equipment— necessary to prevent  equipment backlogs in Kuwait. In July 2009 this unit identified the lack  of oversight personnel as a significant concern with respect to  successfully moving equipment out of Kuwait. According to  contracting officials, the unit had requested an increase in civilian  oversight personnel. However, we have previously reported on the  Army’s difficulties in filling civilian personnel vacancies in Kuwait.
In a June 2009 report, the Commission on Wartime Contracting in Iraq  and Afghanistan found that DOD had insufficient logistics subject  matter experts in Iraq and Afghanistan. In the department’s response  to the June 2009 report, DOD noted that DCMA had in March 2009  requested 57 subject matter experts for food, water, medical, fire, and  petroleum services, but only 40 of the 57 positions had been filled.  Furthermore, according to DCMA as of January 2010, only 19 of the 40  personnel had arrived in theater. During our December 2009 trip to  Afghanistan, DCMA officials stressed to us the need for more subject  matter experts, and they have requested an additional 47 subject  matter experts, but officials do not know when these positions will be  filled. To help mitigate the shortfall of subject matter experts, DCMA  intends to use contractors to provide the needed expertise, according  to DCMA officials.
Since 2004, we and others have reported that DOD has a lack of contract  oversight officials, including CORs, to provide contract oversight and  management in contingency operations. During operations in Iraq and  Afghanistan, the shortage of CORs has been particularly acute for DCMA- administered contracts. For example, in June 2009 DCMA had a  requirement for 1,252 CORs in Iraq but had only 985 in place. Similarly, in  June 2009 DCMA in Afghanistan had a COR requirement of 576 but had  less than half (or 253) of the needed CORs in place. In October 2009 DCMA  announced a new risk-based approach toward assigning CORs. According  to DCMA officials, it had been DCMA’s policy that a COR would be  designated for each contractor-provided service at the location of the  service. According to DCMA officials and documentation, DCMA now  recommends that units assign CORs only to key services—which they  define as high- and medium-risk services that could put health, life, and  safety at risk if not executed in a manner consistent with the contract.
Examples of high- and medium-risk services include food service, power  generation, and postal services. Services such as morale, welfare and  recreation are considered low risk. Services that are not designated as  “key services” do not require CORs, but are monitored on a quarterly basis  by a quality assurance representative. Since implementing this policy,  DCMA has reduced the requirement for CORs to oversee its contracts in  Iraq from 1,100 in October 2009 to 580 in January 2010, and DCMA officials  in Iraq anticipate that they will be able to reduce the COR requirement  further as they continue to designate additional services as low-risk. In  January 2010 DCMA reported that it had 88 percent of its required CORs in  place in Afghanistan. We have not evaluated the effectiveness of this risk- based management program at this time.
In an effort to build economic capacity within Iraq and Afghanistan,  Congress has authorized and DOD has developed programs to encourage  the use of local contractor firms. However, these programs, the Iraq First  Program and the Afghan First Program, further strain the availability of  personnel to provide contract management and oversight. According to  officials from the Joint Contracting Command-Iraq/Afghanistan local  national contractors frequently require more oversight than U.S. firms  because they lack experience, have limited capacity, are frequently less  capable then their U.S. counterparts, are unfamiliar with U.S. quality  standards and expectations, and lack the quality control processes that  U.S. firms have in place. For example, according to DOD officials,  buildings constructed by Afghan contractors have had to be re-wired when  the LOGCAP program assumed responsibility for them because the  LOGCAP contractors responsible for maintenance lacked assurance that  that the electrical work was done correctly. Other officials described  receiving poor quality office furniture, while still others noted that  trucking companies contracted to move U.S. goods often failed to meet  delivery schedules. Without a sufficient number of contract oversight  personnel in place, including subject matter experts, DOD may not be able  to obtain reasonable assurance that contractors are meeting their contract  requirements efficiently and effectively at each location, and that health  and safety concerns have been addressed.
subsections: section_title: Actions to Improve Availability of Oversight Personnel
paragraphs: Several individual organizations or services within DOD have taken  actions to help mitigate the problem of not having enough personnel to  oversee and manage contractors in Afghanistan and Iraq. For example, the  Army issued an Execution Order on CORs in December 2009. In the order,  the Army Chief of Staff directed the commanders of deploying units to  coordinate with the unit they will replace in theater to determine the  number of CORs they will need to designate prior to deployment. The  order states that if the commander is unable to determine specific COR  requirements, each deploying brigade should designate and train 80 CORs  prior to deployment.
In addition, a deploying Marine Expeditionary Force has created an  operational contracting support cell within the logistics element of its  command headquarters. The members of the cell will assist subordinate  units with contracting oversight and guidance on policy, and they will act  as contracting liaisons to the Joint Contracting Command-Iraq/Afghanistan  and as conduits to the regional contracting commands should any issue  arise. The Marines were prompted to set up this cell by lessons learned  from their deployment to Operation Iraqi Freedom, where problems arose  as a result of a lack of expertise and personnel to help oversee and  manage contractors. In addition, the Marine Expeditionary Force trained  approximately 100 Marines as CORs prior to its deployment to Afghanistan  this spring. While not all personnel have been designated as CORs for the  upcoming deployment, all could be called upon to serve as CORs should  the need arise.
While we recognize the efforts DOD has under way to develop long-term  plans intended to address its personnel shortages, the problems we have  identified in the past continue. In previous reports we have recommended  that DOD develop strategies to address its oversight problems, and noted  that unless DOD takes steps to address its current shortages, the  department will continue to be at risk with regard to its assurance that  contractors are providing their required services in an effective and  efficient manner.
section_title: Training of CORs and Non- Acquisition Personnel, Such as Unit Commanders, to Provide Contract Oversight and Management Remains an Issue
paragraphs: Equally important as having enough CORs is having CORs who are  properly trained to provide contract oversight. According to the Army  Chief of Staff’s Execution Order, the lack of personnel in theater who are  sufficiently trained in COR responsibilities is hindering effective oversight  and management of contracts in support of operations in Afghanistan and  Iraq. In addition, a lack of CORs with the right skills can make it more  difficult to resolve contractor performance issues.
The Defense Federal Acquisition Regulation Supplement requires that  CORs be qualified by training and experience commensurate with the  responsibilities to be delegated to them. Specifically, DOD requires that  potential CORs complete courses (which are available on line) that  include training on specific COR duties, an awareness course on  trafficking in persons to help combat this practice and ethics training. In  2006 we reported that individuals deployed without knowing that they  would be assigned as CORs, thus precluding their ability to take the  required training prior to deployment. Individuals we spoke with noted  that it was difficult to set aside the time necessary to complete the training  once they arrived in Iraq. During our recent visit to Afghanistan we found  that units continue to deploy without nominating CORs beforehand, and as  a result the personnel assigned to serve as CORs have to take the required  training upon arrival in theater. Because training is offered through online  courses, staff officers at a combined joint command as well as at an Army  sustainment command in Afghanistan told us that technical limitations,  including a lack of bandwidth, make it difficult to access the training from  Afghanistan. In November 2009 DOD acknowledged concerns regarding  web-based COR training due to connectivity issues.
We also found that although CORs and other oversight personnel are  responsible for evaluating the technical aspects of a contractor’s  performance, these oversight personnel often lack the technical  knowledge and training needed to effectively oversee certain contracts.  For example, in Afghanistan, officials from various organizations  expressed concern to us that there were not enough CORs trained in  trades such as electrical wiring and plumbing to provide oversight over all  the construction contracts, and that this problem will only worsen as the  number of construction projects continues to grow. Also, in a November  2009 analysis, a DOD task force acknowledged the importance of having  CORs with the right skills, noting that units nominating CORs should  consider the technical aspects, monitoring frequency, and monetary value  of the contract to ensure that CORs’ subject matter expertise and  availability are commensurate with the requirement.
An additional, long-standing training challenge hindering management and  oversight of contractors supporting deployed forces is the lack of training  for military commanders and other non-acquisition personnel, such as  senior leaders who need contractors to execute their mission. As we  testified in 2008, limited or no pre-deployment training on the use of  contractor support can cause a variety of problems for military  commanders in a deployed location, such as being unable to adequately  plan for the use of those contractors, or confusion regarding the military  commanders’ roles and responsibilities in managing and overseeing  contractors. Currently, military commanders and other unit leaders are  not required to complete operational contract support training prior to  deployment. In Afghanistan we continued to find that some commanders  had to be advised by contract oversight personnel that they had to provide  certain support, such as housing, force protection, and meals to the  contractors they were overseeing. In addition, having limited or no pre- deployment training for military commanders on the use of contractor  support to deployed forces can result in confusion regarding their roles  and responsibilities in managing and overseeing contractors. For example,  we found some instances in which a lack of training raised concerns over  the potential risk of military commanders directing contractors to perform  work outside the scope of the contract—something commanders lack the  authority to do.
According to several contract oversight personnel, some commanders did  not understand the command and control relationship between  themselves and the contractor, and were unclear as to whether they could  direct the contractor to perform work. Similarly, in a January 2010  acquisition conference, DCMA noted as a challenge the education of unit  commanders on working with contractors. These challenges include  educating the commanders on the value of contractors as a force  multiplier, the unit’s role in providing oversight, and distinguishing  between command and contractual authority. The commander of the  operational contract support cell at a Marine Expeditionary Force  headquarters noted that he considered educating commanders to be one  of his key challenges as his unit prepared to deploy. Without a clear  understanding of the command and control relationship for contractors,  commanders and other key leaders run the risk of directing the contractor  to perform work beyond what was called for in the contract. As Army  guidance makes clear, when military commanders try to direct contractors  to perform activities outside the scope of the contract, this can cause the  government to incur additional charges because modifications would need  to be made to the contract. In some cases, the direction may potentially  result in a violation of competition requirements.
While we continue to observe issues regarding training on the use of  contractor support, initiatives have been taken to implement and  emphasize enhanced training for contract management and oversight  personnel. For example, the Army’s December 2009 Execution Order  directs the Army’s Training and Doctrine Command to develop additional  training, including training to familiarize CORs with LOGCAP. It also  requires brigade commanders to identify and train individuals as CORs  prior to deployment, and it requires that training scenarios for CORs be  incorporated into mission rehearsal and mission readiness exercises. In an  independent effort in Afghanistan, two sustainment units provided training  that incorporated a set of contract-related scenarios prior to their  deployment to Afghanistan. One of the units also sent an officer to the new  2-week Operational Contract Support course conducted by the Army  Logistics Management College. Ninety soldiers from one of the units also  attended COR training, either through the Defense Acquisition University  or through equivalent training. In another example, one of the Marine  Corps’ expeditionary forces preparing to deploy to Afghanistan identified  Marines who may have contract oversight roles in Afghanistan and  brought in an instructor from the Defense Acquisition University to  provide three sessions of COR training prior to their deployment. In  addition, DCMA has begun reaching out to deploying units to provide them  with pre-deployment training on what to expect when they arrive in  Afghanistan, particularly with regard to LOGCAP. Officials responsible for  overseeing a contract for linguist services also stated that their CORs  received contract-specific training prior to deployment. However, these  efforts do not address the concerns about CORs lacking the technical  skills required to provide oversight on more technical contracts,  specifically construction-related contracts. While these training efforts are  promising, they have been driven by individual services and units.
We have been discussing the need for better pre-deployment training on  the use of contractors to support deployed forces since the mid-1990s, and  have accordingly made several recommendations that DOD improve its  training. For example, in 2003 we recommended that DOD develop  training courses for commanding officers and other senior leaders who are  deploying to locations with contractor support, and in 2006 we expanded  on our recommendation and recommended that operational contract  support be included in professional military education and pre-deployment  training. In both instances DOD agreed with our recommendations but  has not fully implemented them. Furthermore, in 2008, Congress mandated  that DOD policies provide for contingency contracting training for certain  non-acquisition personnel, including operational commanders expected to  have acquisition or contract oversight responsibilities. However, these  policies have not yet been finalized, and consequently the training required  has not been institutionalized throughout DOD.
section_title: DOD Continues to Face Badging and Screening Challenges
paragraphs: In Iraq and Afghanistan military commanders and other military officials  have expressed concerns about the risks that contractor personnel,  particularly third country and local nationals, pose to U.S. forces due to  limitations in the background screening process. In 2006 we first reported  on the challenges that DOD faced in ensuring that contractor personnel  had been thoroughly screened and vetted. In July 2009 we reported that  DOD had not developed department-wide procedures to screen local  national and third-country national contractor personnel, in part because  two offices within the department—–that of the Under Secretary of  Defense for Intelligence and that of the Under Secretary of Defense for  Acquisition, Technology, and Logistics—could not agree on the level of  detail that should be included in background screening for third country  and local national employees, and therefore lacked assurance that all  contractor personnel were properly screened. To resolve this issue we  recommended that the Secretary of Defense designate a focal point at a  sufficiently senior level and possessing the necessary authority to ensure  that the appropriate offices in DOD coordinate, develop, and implement  policies and procedures to conduct and adjudicate background screenings  in a timely manner.
DOD has still not developed a department-wide policy on how to screen  local national and third-country national contractor personnel, and as a  result it continues to face challenges in conducting background screening  of these personnel. As we reported in July 2009, absent a DOD-wide policy,  commanders develop their own standards and processes to ensure that  contractor personnel have been screened. In Iraq, U.S. Forces-Iraq, the  U.S. led military organization responsible for conducting the war in Iraq,  has developed a command-wide policy for screening and badging  contractors. However, in Afghanistan, U.S. Forces-Afghanistan (USFOR- A) has not established a command-wide policy for screening and badging  contractors. Instead, each base is responsible for developing its own  background screening and base access procedures, resulting in a variety of  different procedures. Moreover, requirements differ between U.S. bases  and NATO bases. The lack of guidance also affects the ability of force  protection officials to determine the sufficiency of their background  screening procedures. For example, at one base, force protection officials  told us that while they require contractor personnel to provide valid  background screening from their home countries, they had not received  guidance on how to interpret those screenings, and did not know whether  the screenings they received were valid or not. Officials stated that they  rely on a biometric system, also used in Iraq, to screen local national and  third-country national contractor personnel. However, as we reported in  July 2009, the name-checks and biometric data collection associated with  issuing badges rely primarily upon U.S.-based databases of criminal and  terrorist information. In 2006, we reported that background checks that  are reliant upon U.S.-based databases, such as the biometric system used  in Iraq and Afghanistan, may not be effective in screening foreign nationals  who have not lived or traveled to the U.S. Further, some DOD contracts  require contractors to conduct background screenings of their personnel.  In July 2009 we reported that contracts for private security services often  contained unrealistic background screening requirements. For example,  the requirements directed contractors to use data sources to which private  firms may not have access, such as databases maintained by the Federal  Bureau of Investigation and the Central Intelligence Agency. We continue  to find that some DOD contracts include unrealistic background screening  requirements similar to those identified in our July 2009 report. As we  concluded in July 2009, without a coordinated DOD-wide effort to develop  and implement standardized policies and procedures to ensure that  contractor personnel—particularly local nationals and third-country  nationals—have been screened, DOD cannot be assured that it has taken  all reasonable steps to thoroughly screen contractor personnel and  minimize any risks to the military posed by these personnel.
section_title: DOD Lacks Reliable Data on the Number of Contractor Personnel in Iraq and Afghanistan
paragraphs: Since 2002, we have reported on the challenges faced by commanders and  other leaders to obtain accurate information on the number of contractors  and the services they are providing in contingencies and have made  recommendations to improve DOD’s ability to obtain contractor  information. For example, in December 2006 we reported that  commanders had limited visibility of contractors because information on  the number of contractors at deployed locations or the services they  provide was incomplete, unreliable, and not aggregated within any one  DOD organization, a limitation that can inhibit planning, increase costs,  and introduce unnecessary risks. Although DOD has recognized the need  for commanders and other leaders to have reliable data on the number of  contractors and the services they provide, DOD continues to face  challenges in tracking contracts and contractor personnel 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. Reliable and meaningful data  on contractors and the services they provide are a starting point for  agency discussions about when and how to effectively use contractors;  support contractors in terms of housing, security, and other services; and  ensure that contractors are properly managed and overseen.
In January 2007, DOD designated the Synchronized Pre-deployment and  Operational Tracker (SPOT) as its primary system for collecting data on  contractor personnel deployed with U.S. forces, and it directed contractor  firms to enter personnel data for contracts performed in Iraq and  Afghanistan. The SPOT database is designed to provide accountability of  contractor personnel by name, a summary of the services being provided,  and information on government-provided support.
Our reviews of SPOT have highlighted shortcomings in DOD’s  implementation of the system in Iraq and Afghanistan. Most important,  we found that as a result of diverse interpretations as to which contractor  personnel 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, in Iraq, DOD officials  stated that the primary determinant of whether contractor personnel were  entered into SPOT was a contractor’s need or lack of need for a SPOT- generated letter of authorization. Contractor personnel need SPOT- generated letters of authorization 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 in Iraq, and particularly local nationals, need letters  of authorization, and agency officials informed us that such personnel  were not being entered into SPOT. Similarly, officials with one contracting  office in Afghanistan stated that the need for a letter of authorization  determined whether someone was entered into SPOT, resulting in Afghans  not being entered. However, officials from another office stated that that  office was following DOD’s 2007 guidance on the use of SPOT and  entering local nationals into the system.
Because of the varying practices for entering personnel into SPOT, there  are inconsistencies and gaps in the data generated by the system. For  example, while DOD officials expressed confidence that the SPOT data  were relatively complete for contractor personnel who need a letter of  authorization, they acknowledged that SPOT does not fully reflect the  number of local nationals working on contracts. Tracking local nationals  in SPOT presents particular challenges 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 get  around the SPOT requirement of 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.
Because of the short-comings of SPOT, DOD has conducted quarterly  censuses to obtain information on the number of contractor personnel in  Iraq and Afghanistan. DOD officials have regarded the census as the most  complete source of contractor personnel data, but they acknowledged that  the census numbers represent only a rough approximation of the actual  number of contractor personnel working in either country. We found that  census data were sometimes incomplete, while in other cases personnel  were doubly counted. Because of these and related limitations, we  determined that the census data should not be used to identify trends or  draw conclusions about the number of contractor personnel in either Iraq  or Afghanistan.
section_title: Challenges in Identifying Operational Contract Support Requirements in Iraq and Afghanistan
paragraphs: DOD guidance highlights the need to plan for operational contract support  early in an operations planning process because of the challenges  associated with using contractors in contingencies. These challenges  include overseeing and managing contractors in contingency operations.  In previous reports and testimonies we have noted that DOD has not  followed long-standing guidance on planning for operational contract  support. Specifically, joint guidance calls for DOD to identify contract  support requirements as early as possible, to ensure that the military  receives contract support at the right place, at the right time, and for the  right price. Other guidance directs the combatant commander or joint task  force commander to identify operational contract support requirements as  well as develop plans to obtain and manage contract support and include  them in operation plans, operation orders, or fragmentary orders. Our  preliminary observations from ongoing work continue to show that DOD  has not fully planned for the use of contractors in support of ongoing  contingency operations in Iraq and Afghanistan.
On December 1, 2009, the President announced that an additional 30,000  U.S. troops would be sent to Afghanistan to assist in the ongoing  operations there, and the Congressional Research Service estimates that  between 26,000 and 56,000 additional contractors may be needed to  support the additional troops. However, during our December 2009 trip to  Afghanistan, we found that only limited planning was being done with  regard to contracts or contractors. Specifically, we found that with the  exception of planning for the increased use of LOGCAP, USFOR-A had not  begun to consider the full range of contractor services that might be  needed to support the planned increase of U.S. forces. More important,  officials from USFOR-A’s logistics staff appeared to be unaware of their  responsibility as defined by DOD guidance to identify contractor  requirements or develop the contract management and support plans  required by guidance. However, we did find some planning being done by  U.S. military officials at Regional Command–East. According to planners  from Regional Command–East, the command had identified the types of  units that are being deployed to their operational area of Afghanistan and  was coordinating with similar units already in Afghanistan to determine  what types of contract support the units relied on. Furthermore, according  to operational contract support personnel associated with a Marine  Expeditionary Force getting ready to deploy to Afghanistan, the staff  offices within the Marine Expeditionary Force headquarters organization  were directed to identify force structure gaps that could be filled by  contractors prior to deployment and begin contracting for those services.  For example, one section responsible for civil affairs identified the need to  supplement its staff with contractors possessing engineering expertise  because the needed engineers were not available from the Navy.
In addition, although U.S. Forces-Iraq has taken steps to identify all the  LOGCAP support they will need for the drawdown, they have not  identified the other contracted support they may need. According to DOD  joint doctrine and service guidance, personnel who plan, support, and  execute military operations must also determine the contracted support  needed to accomplish their missions. Such personnel include combat  force commanders, base commanders, and logistics personnel. In  particular, these personnel are responsible for determining the best  approach to accomplish their assigned tasks and—if the approach  includes contractors—identifying the types and levels of contracted  support needed. Multi-National Force-Iraq’s (MNF-I) drawdown plan,  however, delegated the responsibility for determining contract support  requirements to contracting agencies, such as the Joint Contracting  Command-Iraq/Afghanistan, rather than to operational personnel. Joint  Contracting Command-Iraq/Afghanistan officials told us, however, that  they could not determine the theater-wide levels of contracted services  required, or plan for mandated reductions based on those needs, because  they lack sufficient, relevant information on future requirements for  contracted services—information that should have been provided by  operational personnel. For example, according to MNF-I documentation,  during an October 2009 meeting between operational personnel and  contracting officials, MNF-I reiterated that the levels of contracted service  ultimately needed in Iraq during the drawdown were unknown. This is  consistent with an overarching weakness identified by a Joint Staff task  force, which recognized limited, if any, visibility of contractor support and  plans, and a lack of requirements definition. As a result, rather than relying  on information based on operationally driven requirements for contracted  services, MNF-I planned for, and U.S. Forces-Iraq (USFOR-I) is  subsequently tracking, the reduction of contracted support in Iraq using  historical ratios of contractor personnel to servicemembers in Iraq, which  may not accurately reflect the actual levels of contracted support needed  during the drawdown.
Insufficient planning may also lead to shortages in contractor personnel  available to perform key functions affecting contractor responsiveness.  For instance, during our December visit to Afghanistan, multiple DOD  officials, including the commander of a base, told us that the current  LOGCAP contractor had pulled many of its skilled workers off the job,  which led to issues such as electrical problems that remained unresolved  for longer than desired periods of time. Furthermore, a maintenance  battalion commander told us that without the assistance of soldiers and  civilian mechanics from the Red River Army Depot, the contractor would  not have had enough personnel to maintain and repair the vehicles and  equipment necessary to meet the mission. Additionally, in December 2009,  an official from USFOR-A-South told us that in Kandahar military  personnel were called upon to augment the operations of a supply facility  because the contractor had not fully staffed the operation. In response to a  DCMA letter of concern regarding contractor personnel shortages, the  contractor agreed to have a full complement of contractor personnel in  place by the middle of February 2010.
Timely planning is critical to avoiding potential waste and ensuring that  critical services are available when needed as the United States increases  troops in Afghanistan and withdraws them from Iraq. In a January 2008  statement before Congress we again highlighted the need for the  department to follow its long-standing planning guidance regarding the use  of contractors to support deployed forces. In that testimony we called  upon DOD leadership to take steps to ensure compliance with existing  guidance. Insufficient planning for requirements may lead to other poor  outcomes, such as increased cost, lengthened schedules,  underperformance, and delays in receiving services. We continue to  believe that the department should take steps to ensure that it adheres to  the guidance detailed in both joint and service publications.
section_title: While DOD Has Taken Some Actions to Institutionalize Operational Contract Support, Much Remains to Be Done
paragraphs: In response to congressional direction and GAO recommendations, DOD  has taken some actions to institutionalize operational contract support,  however much remains to be done. The department has appointed a focal  point to lead in these efforts, has issued some new guidance, and has  begun to determine its reliance on contractors, but it has yet to finalize the  policies required by Congress in the National Defense Authorization Acts  for Fiscal Years 2007 and 2008. In addition, the department needs to take  additional actions to improve its planning for operational contract support  for future operations.
subsections: section_title: DOD Has Taken Some Department-wide Steps to Institutionalize Operational Contract Support
paragraphs: In October 2006, the Deputy Under Secretary of Defense for Logistics and  Materiel Readiness established the office of the Assistant Deputy Under  Secretary of Defense (Program Support) to act as a focal point for leading  DOD’s efforts to improve contract management and oversight at deployed  locations. That office has, for example established a community of  practice for operational contract support comprising subject matter  experts from the Office of the Secretary of Defense, the Joint Staff, and the  services, and this community may be called upon to work on a specific  task or project. Additionally, the office has established a Council of  Colonels, which serves as a “gatekeeper” for initiatives, issues, or  concepts, as well as a Joint Policy Development General Officer Steering  Committee, which includes senior commissioned officers or civilians  designated by the services. The committee’s objective is to guide the  development of Office of the Secretary of Defense, Joint Staff, and service  policy, doctrine, and procedures to adequately reflect situational and  legislative changes as they occur within operational contract support. The  Program Support office is also developing an Operational Contract  Support Concept of Operations, and it has provided the geographic  combatant commanders with operational contract support planners to  assist them in meeting contract planning requirements.
To provide additional assistance to deployed forces, the department and  the Army introduced several handbooks to improve contracting and  contract management in deployed locations. For example,  In 2007 the department introduced the Joint Contingency Contracting  Handbook, which provides tools, templates, and training that enable a  contingency contracting officer to be effective in any contracting  environment. The handbook also contains resources for contracting  officers to promote uniform contracting practices, including  standardized contract forms and language for terms and conditions  The handbook is currently being updated and the department expects  it to be issued in July 2010.
In 2008 the Army issued the Deployed Contracting Officer’s  Representative Handbook. This handbook provides the basic tools and  knowledge needed for use in conjunction with formal COR training.  The handbook was designed to address the realities that CORs face  when operating outside the United States in a contingency operation.
Additionally in October 2008, the department issued Joint Publication  4-10, “Operational Contract Support,” which establishes doctrine and  provides standardized guidance for planning, conducting, and  assessing operational contract support integration, contractor  management functions, and contracting command and control  organizational options in support of joint operations.
Finally, in 2008, the Joint Staff (J-4), at the direction of the Chairman,  undertook a study to determine how reliant the department was on  contractors in Iraq. The intent of the study was to (1) better understand  contracted capabilities in Iraq, to determine areas of high reliance or  dependence; (2) determine where the department is most reliant, and in  some cases dependent, on contractor support, to inform longer-term force  structure and potential “buy back” implications; and (3) guide the  development of future contingency planning and force development.  According to the Joint Staff their initial findings suggest that in Iraq the  department was highly dependent on contractors in four of the nine joint  capability areas, including Logistics. For example, the study showed that  in the third quarter of fiscal year 2008, over 150,000 contractors were  providing logistical support, while slightly more than 31,000 military  personnel were providing similar support. Having determined the level of  dependency and reliance on contractors in Iraq, the Joint Staff plans to  examine ways to improve operational contract support planning, including  the development of tools, rules, and refinements to the existing planning  process.
section_title: DOD Has Yet to Finalize Operational Contract Support Guidance to Meet Congressional Direction
paragraphs: In 2006 Congress directed the Secretary of Defense, in consultation with  the Chairman of the Joint Chiefs of Staff, to develop joint policies by April  2008 for requirements definition, contingency program management, and  contingency contracting during combat and post-conflict operations. In  2008, Congress amended this requirement by directing that the joint  policies also provide for the training of military personnel outside the  acquisition workforce who are expected to have acquisition  responsibilities, including oversight of contracts or contractors during  combat operations, post-conflict operations, and contingency operations.  It also directed that GAO review DOD’s joint policies and determine the  extent to which those policies and the implementation of such policies  comply with the statutory requirements. In November 2008 we reported  that the department had yet to finalize several key documents designed to  meet the requirements established by Congress. We also noted that DOD  was developing an Expeditionary Contracting Policy to address the  requirement to develop a joint policy on contingency contracting, and was  revising the October 2005 version of DOD Instruction 3020.41, Contractor  Personnel Authorized to Accompany the US Armed Forces, to meet the  congressional direction to develop a joint policy on requirements  definition; program management, including the oversight of contractor  personnel supporting a contingency operation; and training. At the time of  our 2008 report, the draft Instruction directed combatant commanders and  service component commanders to conduct planning to identify military  capability shortfalls that require acquisition solutions in commanders’  operational plans, and combatant commanders to integrate operational  contract support issues into training simulations, mission rehearsals, and  exercises. The draft Instruction also directed the service to include  requirements of the Instruction in their training.
As of March 2010, the department had yet to issue either of these  documents. According to the Assistant Deputy Under Secretary of Defense  (Program Support), the revisions to DOD Instruction 3020.41 have been  held up in the review process. The current plan is to post the proposed  revisions in the Federal Register and issue the revised instruction in the  summer of 2010. Until the DOD instruction is revised and issued, the  department’s overarching policy document will not reflect the  department’s current approach to operational contract support.  Furthermore, the provisions of the draft instruction that were intended to  meet the congressional requirement for joint policy applicable to  combatant commanders and the military services have not been  established. Regarding the expeditionary contracting policy, the  department has determined that it will not issue the expeditionary policy  because the practitioners do not believe a joint policy is necessary.
section_title: Plans for Future Operations Lack Information on Contractor Support Requirements
paragraphs: DOD also faces challenges incorporating operational contract support  issues in its operation plans for potential future contingencies. Since 2003,  we have identified the need for the department to ensure that specific  information on the use and roles of contract support to deployed forces is  integrated into its plans for future contingency operations. DOD guidance  has long recognized the need to include the role of contractors in  operation plans and, since early 2006, this guidance has required planners  to include an operational contract support annex—known as Annex W—in  the combatant commands’ most detailed operation plans. Our ongoing  work has found that the department has made some progress in both  meeting this specific guidance and, more generally, in incorporating  contract requirements in its operation plans. However, additional steps are  needed to fully implement DOD guidance.
First, we found that four operation plans with Annex Ws have been  approved, and planners have drafted Annex Ws for an additional 30 plans.  However, according to combatant command officials, most of the annexes  drafted to date restate broad language from existing DOD guidance on the  use of contractors to support deployed forces and included few details on  the type of contractors needed to execute a given plan—despite guidance  requiring Annex Ws to list contracts likely to be used in theater. This was  due to several factors, including a lack of information within the operation  plans on matters such as the size and capabilities of the military force  involved. According to combatant command planners, this information is  needed to enable them to identify the details on contracted services and  capabilities needed to support an operation. In addition, shortcomings in  guidance on how and when to develop these annexes have resulted in a  mismatch in expectations between senior DOD leadership and combatant  command planners regarding the degree to which Annex Ws will contain  specific information on contract support requirements. We found that  several senior DOD officials have the expectation that most combatant  command plans should at least identify the capabilities that contractors  may provide, regardless of the level of plan. However, the contract support  planners and other officials responsible for developing the Annex Ws  disagreed, stating that given the limited amount of information on military  forces in most operation plans, the expected level of detail was difficult if  not impossible to achieve. In most cases, we found that Annex Ws did not  contain the level of detail expected by senior DOD leadership and  envisioned in current guidance, thus limiting the utility of the Annex W as  a planning tool to assess and address contract support requirements.
Second, in discussion with combatant command officials responsible for  developing operation plans, we found that detailed information on  operational contract support requirements is generally not included in  other sections or annexes of these plans. Although the Annex W is  intended to be the focal point within an operation plan for discussing  operational contract support, DOD guidance underscores the importance  of addressing contractor requirements throughout an operation plan.  However, we found that non-logistics personnel tend to assume that the  logistics community will address the need to incorporate operational  contract support throughout operation plans. For example, combatant  command officials told us they were not aware of any assumptions  specifically addressing the potential use or role of operational contract  support in their base plans. Assumptions are used to focus attention of  senior DOD leadership on factors that could present risks to mission  success. Similarly, according to DOD planners, there is a lack of details on  contract support in other parts of most base plans or in the non-logistics  (e.g., communication or intelligence) annexes of operation plans. DOD  guidance for these annexes directs planners to identify the means or  capabilities necessary for meeting mission requirements. Although this  guidance does not specifically mention contractors, contractors provide  significant support in these areas.
The lack of details on contract support requirements in Annex Ws, along  with the limited discussion of contractors in other portions of operation  plans, can hinder the ability of combatant commanders to understand the  extent to which their plans are reliant on contractors. Moreover, senior  decision makers may incorrectly assume that operation plans have  adequately addressed contractor requirements. As a result, they risk not  fully understanding the extent to which the combatant command will be  relying on contractors to support combat operations, and being  unprepared to provide the necessary management and oversight of  deployed contractor personnel.
section_title: Concluding Observations
paragraphs: In closing, DOD has taken positive steps in recognizing its reliance on  contractors to support operations both now and in the future, and it has  emphasized the need for increased oversight and management over these  contractors. However, more work is needed to address the long-standing  challenges I have discussed today. Many of the challenges I have  identified, particularly those related to contract management, oversight,  and planning, stem from DOD’s inability to institutionalize operational  contract support by accepting contractors as an integral part of the total  force. Reforming the way DOD approaches operational contract support  will require a fundamental cultural change for the department. As part of  the effort to bring about such changes, DOD will need to continue to  evaluate the role that contractors play in contingency operations to  determine the appropriate balance of contractors and military forces and  institutionalize operational contract support at all levels of professional  military education as well as in predeployment training and exercises.
Mr. Chairman, this concludes my statement. I would be happy to answer  any questions.
section_title: GAO Contacts and Acknowledgments
paragraphs: For further information about this statement, please contact William Solis  at (202) 512-8365 or solisw@gao.gov. In addition, contact points for our  Offices of Congressional Relations and Public Affairs may be found on the  last page of this statement. Individuals who made key contributions to this  statement are Carole Coffey, Assistant Director;  Vincent Balloon, Laura  Czohara, Melissa Hermes, Guy LoFaro, Emily Norman, Jason Pogacnik,  James Reynolds, and Cheryl Weissman.
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