Hill gets tough on DOD budget

In what has been described as a turning point in the Defense Department's long-term budget plans, the House of Representatives this month passed the fiscal 2000 Defense appropriations bill, while harshly criticizing DOD's methods of addressing critical shortfalls in modernization and of overseeing information technology programs.

In a 379-45 vote to pass the $266 billion bill, the House reasserted its constitutional "power of the purse," focusing its attention on what it called a "steady erosion" of compliance with acquisition laws and regulations. In addition, the bill states that DOD must provide written proof that detailed plans and goals exist for major acquisition programs, and DOD must adhere to congressional mandates before specific funds are released.

"The committee strongly believes that, in many ways, this year is a potential watershed for future defense planning, budgets and programs," the House report on the bill stated. In fact, the House set out to measure DOD's budget request against its Future Years' Defense Program by examining "neglect by certain DOD agencies of law, regulation and practices" and other factors, the report stated.

The House report specifically took aim at the Air Force and Army acquisition communities, lambasting officials for abusing congressionally appropriated funds. "The Air Force acquisition community continues to ignore and violate a wide range of appropriations practices and acquisition rules [and] continues to blithely ignore specific committee direction and law," the report stated.

Responding to the report's findings, a spokeswoman for the Air Force said, "The Air Force has not undertaken any actions to mislead Congress or misuse appropriated funds." The language in the report "is the result of misunderstanding or misinterpretation of the budget documents submitted to them," she added.

The examples provided in the report include using "substantial development funds" earmarked for the Milstar satellite program for other procurement programs, as well as requesting hundreds of millions of dollars for procurement "when in fact the intended use is to support operation and maintenance funding needs," according to the report.

Likewise, the report accused the Army's acquisition community of ignoring specific congressional directives and House-Senate conference report mandates. According to the report, the Army negotiated a multiyear production contract for an improved Target Acquisition System for the TOW missile despite the fact that Congress had not approved the program.

The Army could not be reached for comment by press time.

Congress also expressed "disappointment" with DOD's oversight of major IT programs, citing a report by DOD's inspector general that rates IT oversight as one of DOD's top 10 management problems. In fact, DOD's oversight failures prompted the House to include in the bill a new general provision that forces DOD to provide written proof that all IT systems meet Clinger-Cohen Act requirements.

Signed into law in 1996, Clinger-Cohen directs federal agencies to measure the success of technology investments in terms of the direct impact those investments have on agencies' core missions.

DOD's senior IT product review board "has not even met in over a year," and systems that are approved often lack key documentation, the report concluded.

"At least seven programs totaling $780 million are moving forward, despite lacking an acquisition program baseline, a critical tool for program management," the report stated. "Others have gone forward without being able to demonstrate the costs and benefits of the investment."

DOD Responds

A DOD spokeswoman called the information on oversight of IT systems in the House report "misleading and inaccurate," adding that the DOD chief information officer has issued 28 acquisition decision memoranda in the past year, all of which were fully coordinated with the senior steering group members. "We do not measure oversight by the number of meetings," the spokeswoman said. "We ensure [that] warfighters receive quality systems."

Speaking at a press briefing shortly after the House issued its report, Defense Secretary William Cohen said the report's revelations came as "somewhat of a surprise" to the Pentagon. "If there are any deficiencies or allegations of failure to comply with the law, we will work with the committee to satisfy them as to the proper result," Cohen said. "I might point out that one committee may cite the Pentagon for failing to follow the direction of the House language, when in fact we may have something inconsistent in a Senate report, [resulting in] an ambiguous full House-

Senate conference report," Cohen said. "So some of this may be attributed to ambiguity in terms of what the direction is between the two houses."

The report also revealed that funds appropriated in fiscal 1999 for DOD's Electronic Commerce Resource Center program, which is aimed at streamlining acquisition procedures using IT, "have not been released and in fact have been used for other purposes or for activities of lower value, including reimbursement of administrative support contractors."

Officials at the Joint Electronic Commerce Program Office could not be reached for comment.

Addressing the department's IT oversight challenges head-on, the House directed DOD to take a number of steps to enhance IT program management and ordered the department to submit a progress report by March 1, 2000. Under the House's directions, DOD must:

Ensure that program managers for all major IT programs are adequately trained.

Report on the status of all IT program managers who meet training requirements and of plans to train those who do not.

Establish separate program elements for each major IT system.

Review how IT infrastructure is acquired.

Consolidate infrastructure resources into infrastructure-specific accounts.

Although the bill focused a good deal of attention on reeling in DOD's acquisition practices, it also took note of the many lessons learned from the war in Kosovo, boosting funding for many key IT programs, including tactical intelligence, surveillance and reconnaissance, information assurance and base communications infrastructure. The House boosted total spending for all of those areas combined by more than $900 million.

Concentration Problems

However, DOD must submit a detailed funding allocation plan, along with specific goals, before an additional $150 million earmarked by the House for information superiority and information assurance can be transferred to any DOD organization that needs the money. The stipulation followed House concerns that DOD information assurance efforts could experience the same lack of concentration that was present during its early phases of addressing the Year 2000 problem.

"The committee believes that the problems the department encountered and the steps it has taken to deal with the Y2K problem are directly related to addressing the problem of information assurance," the report stated. "One of the unfortunate lessons of the Y2K process was the inability of the department's chief information officer to get the services and agencies to concentrate on [Y2K] earlier," according to the report. Therefore, the House bill would require DOD by March 31, 2000, to register all IT systems in a database similar to the database DOD uses for tracking Year 2000 compliance.

Olga Grkavac, executive vice president of the Information Technology Association of America's Enterprise Solutions Division, said the predominant opinion throughout industry is that the challenges facing DOD in information assurance "is the next Y2K" problem. "We would be very supportive of a stronger CIO," Grkavac said. "It makes sense to mesh the CIO's ability with their authority."