Wednesday, July 9, 2008

Why the Military Can't Fix Equipment Fast Enough

According to a GAO report issued on July 8, the amount of equipment being sent to the five military repair depots is causing incredible strain on the system that repairs the equipment our military needs to sustain operations
The five Army depot maintenance activities support combat readiness by providing services necessary to keep Army units operating worldwide. From fiscal year 2004 through fiscal year 2007, the amount of new orders received to perform work increased from approximately $2.6 billion to $5.2 billion—about a 100 percent increase. These orders were to repair and overhaul a wide range of assets, including helicopters, such as the Apache and Blackhawk; combat vehicles such as the Abrams tank; air defense systems, such as the Patriot missile; electronics; and inventory items for the Army, other military services, and foreign governments. Many of these weapons systems are used to support the Army’s current effort in Iraq and Afghanistan. To perform the work needed in support of the Global War on Terrorism, the number of employees at the five depots increased from 12,983 to 15,717—a 21 percent increase—from fiscal year 2004 to fiscal year 2007 and the number of direct labor hours of work increased from about 16.3 million in fiscal year 2004 to 24 million for fiscal year 2007—a 47 percent increase.

The five Army depots operate under the working capital fund concept, where customers are to be charged for the anticipated full cost of goods and services. To the extent that the depots do not complete work at year-end, the funded work will be carried into the next fiscal year. Carryover is the reported dollar value of work that has been ordered and funded (obligated) by customers but not completed by working capital fund activities at the end of the fiscal year.

The dramatic increase in "carryover" is the strain, and because we are running at full speed in Iraq and increasing our operations in Afghanistan, the carryover is only going to increase unless drastic action is taken to reduce that strain. I should also note--what "foreign governments" are putting strain on the system? I hope they need the gear to help us fight.

The following chart shows the growth--and the strain--that the military repair depots are under:

The reasons are pretty stark for this:
Our analysis of fiscal years 2006 and 2007 Army depot reports and discussions with depot officials identified four primary reasons for the significant growth in carryover. While some of these reasons are under the control of other DOD activities, such as customers not sending assets needing repair to the depots as planned, other reasons are within the depots’ control.

•First, the Army depot maintenance budget significantly underestimated the amount of new orders received from customers by about $1.7 billion and $1.5 billion for fiscal years 2006 and 2007, respectively. While the depots performed more work than budgeted during fiscal years 2006 and 2007, they could not keep pace with the increases in new orders.

•Second, the depots accepted new orders late in fiscal years 2006 and 2007 that could not reasonably be completed (and in some cases were not even started) prior to the end of the fiscal year.

•Third, our analysis of depot data and interviews with depot officials found that the depots experienced shortages in parts needed to perform their work in fiscal years 2006 and 2007.

•Fourth, based on our review of selected depot production reports on the status of work and discussions with depot officials, we determined that unserviceable assets (assets requiring repair) were not sent to the depots for repair as planned. Army officials informed us that in some cases the assets remained in-theatre (such as Iraq) for longer periods than planned.

I think it's outrageous that the planning was this bad. Obviously, "no one could have forseen" that we'd be tied down in two wars, one unsustainable and one escalating quickly out of control because of a lack of available US troops.

If one of these facilities is located near you, I would be willing to bet you that they're hiring and looking to expand. As the demand increases, the GAO indicated that these facilities have been adding personnel:

• Anniston performs maintenance on both heavy- and light-tracked combat vehicles and their components, such as the M1 Abrams tank.

•Corpus Christi Army Depot (Corpus Christi) overhauls, repairs, modifies, tests, and modernizes helicopters, engines, and components for all services and foreign military customers.

•Letterkenny Army Depot (Letterkenny) has tactical missile repair capabilities supporting a variety of DOD missile systems including the Patriot and its ground support and radar equipment. In response to the Global War on Terrorism, Letterkenny is rebuilding the High Mobility Multi-Purpose Wheeled Vehicles (HMMWV) that are returning from theater and is rebuilding them to a configuration that will support add-on armor.

•Red River Army Depot (Red River) performs maintenance, certification, and related support services on ground combat systems, air defense systems, and tactical wheeled vehicles. Systems supported include the Bradley Infantry Fighting Vehicle, Multiple Launch Rocket System, Small Emplacement Excavator, 5-ton dump truck, and HMMWVs.

•Tobyhanna uses advanced technologies to ensure the readiness of U.S. armed forces and is a full-service repair, overhaul, and fabrication facility for communications-electronics.

This last part is the part that probably bothers me the most--the lack of spare parts is absolutely killing our ability to repair and refurbish equipment and get it back to the troops. When you hear stories like thisabout how we found ourselves in urban combat with the wrong equipment or simply not enough of it and this story where a soldier complains about waiting months for "a handful of screws" , it indicates to me that we have never properly put this country on a wartime footing and used our manufacturing and industrial capabilities to supply the troops. What's lost in all of this is that if we invested in helping create or sustain a dozen or more companies that could manufacture and upgrade or retool and rehabilitate equipment, it would create jobs. It would be "pork barrel spending" to certain folks but it would be money well spent to sustain our military AND reduce the strain on these depots:
Our analysis of depot data and interviews with depot officials found that the depots experienced shortages of parts needed to perform their repair work in fiscal years 2006 and 2007. Our analysis of data in the critical maintenance repair parts reactive system11 at four depots showed that in 733 and 605 instances, repair parts shortages resulted in work stoppage in fiscal years 2006 and 2007, respectively. DLA and to a lesser extent Army Supply were the sources of supply for most of the repair parts. DLA officials told us that a major difficulty DLA faces as a supplier is forecasting the amount of repair parts needed when the depots’ types and numbers of repairs keep changing. Having a firm requirement (quantity of items to be repaired) early in the process is critical if DLA is to provide the spare parts to the depots when they need them. However, this has not always been the case. For example, as discussed later in this report, in November 2006, Red River accepted an order to overhaul 200 HMMWVs. Over the next 4 months, the order was amended first to decrease the quantity to 106 and then increase the quantity to 344. According to DLA officials, changing requirements, similar to this example, make it extremely difficult to forecast the spare parts needed for repairs. If DLA waits to buy the parts until the depot has a firm requirement, the parts might not be available when the depot needs them. On the other hand, if DLA buys the parts before the requirement is firm, DLA is at risk for excess inventory of parts when requirements for parts are significantly reduced.

Depots Could Not Obtain Parts Needed to Perform Repair Work as Scheduled

In order to perform the required repair work and help minimize the impact of parts shortages on depot operations, the depots have taken a number of actions to obtain parts when they were not available, including using parts from other assets, commonly referred to as robbing parts; fabricating the parts; and obtaining parts through the use of their local procurement authority, including the government purchase card. The following are examples of actions taken by the depots.

In October 2006, Anniston accepted a $5.6 million order financed with fiscal year 2007 operation and maintenance appropriated funds to overhaul 1,200 M2 machine guns. The work was originally scheduled to begin in March 2007. Because of the lack of parts, the work did not begin until July 2007 which resulted in more carryover than originally planned. About $5.4 million of the $5.6 million carried over from fiscal year 2007 into fiscal year 2008.

Because of the Global War on Terrorism and the surge in production of the M2s, Anniston had problems with obtaining parts to overhaul the machine guns since 2004. Because the depot could not get the needed parts from DLA or Army Supply, it used parts from other M2 machine guns. Some of these parts included the barrels, buffer body assemble, bolt, barrel extensions, breech locks, and receivers. Since the depot used parts from these 1,200 machine guns to repair machine guns in previous years, these 1,200 machine guns were missing parts. By the time the depot overhauled the 1,200 M2 machine guns, about half of the M2s had been totally stripped of their parts. An Army official stated that the machine guns going through overhaul were the “worst of the worst.” To perform the work, the depot had to buy new parts and have the Picatinny Arsenal fabricate barrel extensions in order to obtain the parts needed to complete the overhaul. This extra work increased the costs to about $10.4 million and the work was completed in December 2007.

In November 2006, Red River accepted an order totaling approximately $24.8 million to overhaul 200 M1114 up armor HMMWVs from the Army TACOM Life Cycle Management Command. The order was financed with fiscal year 2007 operation and maintenance appropriated funds and was modified twice. In January 2007, the order was reduced to overhaul 106 HMMWVs for about $13.1 million. Two months later in March 2007, the order was increased to 344 HMMWVs for about $56.1 million. In performing this work, the depot encountered two problems. First, the HMMWVs were not always available, resulting in changes to scheduling the performance of work. Second, the depot encountered problems in obtaining the material it needed to perform the repairs. For example, in May 2007, there was a shortage or potential parts shortage of 45 different parts to perform this work. To obtain the parts needed to perform the work, depot officials stated that they used parts from other vehicles at the depot or purchased parts via local procurement, including using government purchase cards. In August 2007, there was a shortage or potential parts shortage of 30 different parts. Since most of the work was not completed in fiscal year 2007, about $37.5 million carried over into fiscal year 2008. As of December 2007, documents showed that the depot anticipated completing work on this order in April 2008.

In discussing the M1114 up armor HMMWV work with Red River officials, they told us that the problems encountered in performing the fiscal year 2007 work also occurred in the previous fiscal year. First, the quantity to be repaired kept changing. Specifically, in January 2006 they accepted an order to repair 37 HMMWVs. In March 2006, the order was amended to 108 HMMWVs. Then in July 2006 the order was amended to repair 58 HMMWVs. Finally, in August, 2006, the order was amended back to 108 HMMWVs. Second, the depot also encountered problems on obtaining parts to perform the work. According to depot officials, because the last amendment increasing the order to 108 HMMWVs occurred in August 2006 and the HMMWVs to be repaired were in poor condition, the carryover amount was high.

Finally, someone who knows what the hell they're supposed to use their government credit card on!

As this problem gets worse, remember--every time a troop doesn't have the equipment that they need in a war zone, their unit suffers, their readiness suffers and they are placed in danger for no good reason.

And that's the real outrage here. No American should ever reach for a weapon or go without a vehicle that isn't there in a war zone.

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