Defense Logistics: Department of Defense's Annual Report on the Status of Prepositioned Materiel and Equipment Can Be Enhanced to Better Inform Congress

The Department of Defense (DOD) prepositions equipment at strategic locations around the world in order to field combat-ready forces in days, rather than the weeks it would take if equipment had to be moved from the United States to the locations of conflicts. DOD's prepositioned stock programs support the National Military Strategy and are an important part of its overall strategic mobility framework. Prepositioned materiel and equipment have played an important role in supporting ongoing operations in Iraq and Afghanistan. However, sustained continuing operations in Iraq and Afghanistan have taken a toll on the condition and readiness of military equipment. In April 2008 we testified that it was unclear when these critical reserve stocks would be reconstituted or how much the total cost would be. The Army and Marine Corps face a number of ongoing and long-term challenges that will affect both the timing and the cost of equipment repair and replacement--particularly to its prepositioned stocks. DOD has reported to Congress that the military services are committed to resetting prepositioned materiel but must balance its efforts within the priorities of reorganization of those prepositioned capabilities and changes in overseas military presence. In June 2008, DOD issued an instruction on the War Reserve Materiel Policy. In the instruction, DOD established a Global Prepositioned Materiel Capabilities Working Group to, among other things, address joint issues concerning war reserve risk assessments provided by the military departments and the Defense Logistics Agency, initiate programs as needed, and make recommendations for war reserves that balance resources against operational risk. Over the last few years, we have identified a number of ongoing and long-term challenges that will affect both the timing and the cost of reconstituting prepositioned stocks. The National Defense Authorization Act for Fiscal Year 2008 (NDAA) added an annual reporting requirement to Title 10 of the United States Code, directing DOD to submit a report to the congressional defense committees on the status of prepositioned materiel and equipment as of the end of each fiscal year, no later than the date of the submission of the President's annual budget requests. The report is required to address the following six elements: (1) the level of fill for major end items of equipment and spare parts, (2) the materiel condition of equipment in the prepositioned stocks, (3) a list of major end items drawn from prepositioned stocks that fiscal year and a description of how the equipment was used and whether it was returned to the stocks after its use, (4) a timeline for completely reconstituting any shortfall in the prepositioned stocks, (5) an estimate of the funding required to completely reconstitute any shortfall in the prepositioned stocks and a description of the Secretary's plan for carrying out the reconstitution, and (6) a list of any operations plans affected by a shortfall in the prepositioned stocks and a description of the action taken to mitigate any risk created by that shortfall.

While DOD addresses the six elements required in its annual report, the services' information varied due to differences in the configuration of their prepositioned materiel and equipment. The law also requires the services to report on the status and condition of spare parts. The Navy and Marine Corps provided data on spare parts, but the Army and Air Force did not do so because they track spare parts differently. In addition to reporting on the status and condition of their prepositioned materiel and equipment, the services reported on the status of equipment drawn from and returned to prepositioned stocks during the reporting period of October 1, 2007, to March 31, 2008, to support ongoing operations or training exercises; timelines ranging from 2010 to 2015 to reconstitute shortfalls in stocks; funding estimates to reconstitute those shortfalls; and the risk to operations plans that would be affected by any shortfall in prepositioned stocks and subsequent mitigation strategies. In future DOD reports on the status of its prepositioned materiel and equipment, additional information on funding requirements for the services' prepositioned programs and risk to current operations and concept plans could further inform congressional defense committees. The services provided the Joint Staff with an estimate of the amount of funds required to reconstitute shortfalls of prepositioned materiel and equipment as required. However, overall funding estimates on equipment and materiel shortages alone do not provide a means to measure the services' progress toward meeting long-term prepositioning goals or provide the visibility to inform congressional decision making. Consistent with best practices to provide clear funding plans to support decision making, funding estimates should be transparent, comprehensive, easily replicated, and updated to help ensure the validity of the estimate. In addition to the required estimate to reconstitute shortfalls, presenting funding requirements by year and appropriation accounts, similar to DOD's annual budget request presentation, in one report to Congress would provide a more comprehensive, detailed estimate of the services' requirements for prepositioned materiel and equipment. Detailed funding estimates would provide a means to measure the services' progress towards meeting long-term prepositioning goals. While the services listed operations plans affected by shortfalls in prepositioned stocks, as required, additional information on the effect of prepositioned equipment shortfalls on current operations such as ongoing operations in Iraq and Afghanistan and concept plans such as plans for the defense of one country against invasion from another country, would provide greater disclosure and visibility over other possible risks. Without information on other possible risks, Congress may not be fully informed on the range of military options available in times of crisis.