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entitled 'Military Pay: Army National Guard Personnel Mobilized to
Active Duty Experienced Significant Pay Problems' which was released on
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Report to the Chairman, Subcommittee on National Security, Emerging
Threats, and International Relations, Committee on Government Reform,
House of Representatives:
November 2003:
MILITARY PAY:
Army National Guard Personnel Mobilized to Active Duty Experienced
Significant Pay Problems:
[Hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO-04-89] GAO-04-89:
GAO Highlights:
Highlights of GAO-04-89, a report to the Chairman, Subcommittee on
National Security, Emerging Threats, and International Relations,
Committee on Government Reform, House of Representatives
Why GAO Did This Study:
In light of the recent mobilizations associated with the war on
terrorism and homeland security, GAO was asked to determine if
controls used to pay mobilized Army Guard personnel provided assurance
that such pays were accurate and timely. GAO’s audit used a case study
approach to focus on controls over three key areas: processes, people
(human capital), and systems.
What GAO Found:
The existing processes and controls used to provide pay and allowances
to mobilized Army Guard personnel are so cumbersome and complex that
neither DOD nor, more importantly, the mobilized Army Guard soldiers
could be reasonably assured of timely and accurate payroll payments.
Weaknesses in these processes and controls resulted in over- and
underpayments and late active duty payments and, in some cases,
largely erroneous debt assessments to mobilized Army Guard personnel.
The end result of these pay problems is to severely constrain DOD’s
ability to provide active duty pay to these personnel, many of whom
were risking their lives in combat in Iraq and Afghanistan. In
addition, these pay problems have had a profound financial impact on
individual soldiers and their families. For example, many soldiers and
their families were required to spend considerable time, sometimes
while the soldiers were deployed in remote, combat environments
overseas, seeking corrections to active duty pays and allowances.
The pay process, involving potentially hundreds of DOD, Army, and Army
Guard organizations and thousands of personnel, was not well
understood or consistently applied with respect to determining (1) the
actions required to make timely, accurate pays to mobilized soldiers,
and (2) the organization responsible for taking the required actions.
With respect to human capital, we found weaknesses including (1)
insufficient resources allocated to pay processing, (2) inadequate
training related to existing policies and procedures, and (3) poor
customer service. Several systems issues were also a significant
factor impeding accurate and timely payroll payments to mobilized Army
Guard soldiers, including (1) non-integrated systems, (2) limitations
in system processing capabilities, and (3) ineffective system edits.
What GAO Recommends:
GAO makes a series of recommendations directed at immediate actions
needed to address weaknesses in the processes, human capital, and
systems currently relied on to provide active duty pay and allowances
to mobilized Army Guard soldiers. In addition, GAO recommends action,
as part of the Department of Defense’s (DOD) longer-term system
improvement initiatives, to ensure that reengineering efforts include
the process, human capital, and systems issues identified in this
report.
DOD concurred with GAO’s recommendations and described actions
recently completed, underway, and planned to correct the noted
deficiences.
www.gao.gov/cgi-bin/getrpt?GAO-04-89.
To view the full product, including the scope and methodology, click
on the link above. For more information, contact Gregory D. Kutz at
(202) 512-9505 or Kutzg@gao.gov.
[End of section]
Contents:
Letter:
Results in Brief:
Background:
Case Studies Illustrate Significant Pay Problems:
Significant Weaknesses in Processes over Mobilized Army Guard Pay:
Human Capital Issues Affect Ability to Pay Mobilized Army Guard
Soldiers Promptly and Accurately:
Systems Problems Hamper Prompt and Accurate Army Guard Pay:
Army Guard Active Duty Pay Problems Continue with Current Deployments
to Iraq:
Conclusions:
Recommendations for Executive Action:
Agency Comments and our Evaluation:
Appendixes:
Appendix I: Colorado Army National Guard B Company, 5TH Battalion, 19TH
Special Forces:
Mobilization Pay Problems:
Deployment Pay Problems:
Pay Problems Associated with Demobilization and Release from Active
Duty:
Appendix II: Virginia Army National Guard B Company, 3RD Battalion,
20TH Special Forces:
Mobilization Pay Problems:
Deployment Pay Problems:
Pay Problems Associated with Demobilization and Release from Active
Duty:
Appendix III: C Company, 2ND Battalion, 19TH Special Forces Group, West
Virginia:
Mobilization Pay Problems:
Deployment Pay Problems:
Demobilization and Release from Active Duty Pay Problems:
Appendix IV: Mississippi 114th Military Police Company:
Mobilization Pay Problems:
Deployment Pay Problems:
Pay Problems Associated with Demobilization and Release from Active
Duty:
Appendix V: Maryland 200th Military Police Company:
Mobilization Pay Problems:
Deployment Pay Problems:
Demobilization and Release from Active Duty Pay Problems:
Appendix VI: California 49th Military Police Headquarters and
Headquarters Detachment:
Mobilization Pay Problems:
Deployment Pay Problems:
Pay Problems Associated with Demobilization and Release from Active
Duty:
Appendix VII: Scope and Methodology:
Appendix VIII: Comments from the Department of Defense:
Appendix IX: GAO Contacts and Staff Acknowledgments:
GAO Contacts:
Acknowledgments:
Tables:
Table 1: Basic Pays and Allowances Associated with Case Study Units:
Table 2: Pay Problems at Six Case Study Units:
Table 3: Summary of Identified Pay Problems by Phase:
Table 4: Identified Mobilization Pay Problems:
Table 5: Identified Deployment Pay Problems:
Table 6: Identified Demobilization Pay Problems:
Table 7: Timetable of Colorado B Company's Unresolved Pay-Related Debts:
Table 8: Summary of Identified Pay Problems by Phase:
Table 9: Identified Mobilization Pay Problems:
Table 10: Identified Deployment Pay Problems:
Table 11: Identified Demobilization Pay Problems:
Table 12: Summary of Identified Pay Problems by Phase:
Table 13: Identified Mobilization Pay Problems:
Table 14: Identified Deployment Pay Problems:
Table 15: Identified Pay Demobilization Problems:
Table 16: Summary of Identified Pay Problems by Phase:
Table 17: Identified Mobilization Pay Problems:
Table 18: Identified Deployment Pay Problems:
Table 19: Identified Demobilization Pay Problems:
Table 20: Summary of Identified Pay Problems by Phase:
Table 21: Identified Mobilization Pay Problems:
Table 22: Identified Deployment Pay Problems:
Table 23: Identified Demobilization Pay Problems:
Table 24: Summary of Identified Pay Problems by Phase:
Table 25: Identified Mobilization Pay Problems:
Table 26: Identified Deployment Pay Problems:
Figures:
Figure 1: Three Key Phases for Active Duty Pays to Army Guard Soldiers:
Figure 2: Units and Deployment Locations:
Figure 3: Initial Mobilization Phase Process:
Figure 4: Deployed Phase Process:
Figure 5: Demobilization Phase Process:
Figure 6: Overview of Army Guard Pay and Personnel Systems:
Figure 7: Sample Army Guard Leave and Earnings Statement:
Figure 8: Sample Leave and Earnings Statement with Large Debt Balance:
Figure 9: Timeline Showing Key Actions Associated with Colorado National
Guard Special Forces Unit's Mobilization:
Figure 10: Timeline Showing Key Actions Associated with Virginia Army
National Guard Special Forces Unit's Mobilization:
Figure 11: Itinerary of Two B Company Soldiers' Efforts to Start
Location-Based Pays for the Unit:
Figure 12: Timeline Showing Key Actions Associated with West Virginia
National Guard Special Forces Unit's Mobilization:
Figure 13: Timeline Showing Key Actions Associated with the Mississippi
Army National Guard Military Police Unit's Mobilization:
Figure 14: Timeline Showing Key Actions Associated with the Maryland
National Guard Military Police Unit's Mobilization:
Figure 15: Timeline Showing Key Actions Associated with the California
Army National Guard Military Police Unit's Mobilization:
Letter:
November 13, 2003:
The Honorable Christopher Shays:
Chairman, Subcommittee on National Security, Emerging Threats, and
International Relations:
Committee on Government Reform:
House of Representatives:
Dear Mr. Chairman:
In response to the September 11, 2001, terrorist attacks, the Army
National Guard (Army Guard) mobilized and deployed soldiers in support
of Operations Noble Eagle and Enduring Freedom. When mobilized for up
to 2 years at a time, these Army Guard soldiers performed search and
destroy missions against Taliban and al Qaeda members throughout Asia
and Africa; fought on the front lines in Afghanistan and Iraq; guarded
al Qaeda prisoners held at Guantanamo Bay, Cuba; provided security at
the Pentagon; and are now assisting in peace-keeping operations in
Iraq.
In 1993, we reported[Footnote 1] on millions of dollars of overpayments
and other problems associated with payroll payments to Army military
personnel during 1992 as soldiers returned from Operations Desert
Shield and Desert Storm. A significant factor contributing to the
improper payments discovered as part of that audit was the large number
of Army Guard personnel mobilized to active duty and paid from the
Army's active duty payroll system. Because many of the current
missions, particularly those associated with the global war on
terrorism, are expected to persist, Army Guard personnel are likely to
continue to experience additional mobilizations. Given the critical
roles these mobilized Army Guard soldiers play in carrying out vital
military missions both in the United States and overseas, effective
internal controls are needed not only to provide timely and accurate
pay to these soldiers, but also to prevent any such problems from
adversely affecting the Army's ability to retain these valuable
personnel.
In light of the recent mobilizations and growing importance of the Army
Guard in fighting the war on terrorism and providing domestic security,
you asked us to determine if controls used to pay mobilized Army Guard
personnel using the Army's reserve pay system provided reasonable
assurance that such payments were accurate and timely.
Because our preliminary assessment determined that current operations
used to pay mobilized Army Guard soldiers relied extensively on error-
prone manual transactions entry into multiple, nonintegrated systems,
we did not statistically test current processes and controls. Instead,
we used a case study approach to provide more detailed perspective on
the nature of pay deficiencies in the three key areas of processes,
people (human capital), and systems. Specifically, we gathered
available data and analyzed the pay experiences of Army Guard special
forces and military police units mobilized to active duty in support of
Operations Noble Eagle and Enduring Freedom during the period from
October 2001 through March 2003. (See apps. I-VI for detailed summaries
of our six case study units.) Finally, you asked us to identify any
evidence that pay problems were continuing with Army Guard personnel in
more recently mobilized units deployed to support missions in Iraq. We
conducted a limited review of the initial mobilization and deployment
pay records of one unit currently participating in that operation.
We performed our work from November 2002 through September 2003 in
accordance with generally accepted government auditing standards.
Further details on our scope and methodology are included in appendix
VII. We requested comments on a draft of this report from the Secretary
of Defense or his designee. We received written comments from the Under
Secretary of Defense (Comptroller), which are reprinted in appendix
VIII.
Results in Brief:
The existing processes and controls used to provide basic and special
active duty pays to mobilized Army Guard personnel are so cumbersome
and complex that the Army; the Defense Finance and Accounting Service
(DFAS); and, most importantly, the mobilized Army Guard soldiers cannot
be reasonably assured of timely and accurate payroll payments.
Weaknesses in the current processes and controls resulted in a
substantial number of over-and underpayments and late active duty
payments[Footnote 2] to mobilized Army Guard personnel at our case
study units. For example, 450 of the 481 soldiers from our six case
study units had at least one pay problem associated with their
mobilization. These pay problems severely constrain the Army's and the
Department of Defense's (DOD) ability to provide a most basic service
to these personnel, many of whom were risking their lives in combat. In
addition, resulting inaccurate, late, and, or missing pays, and
associated erroneous debts also had a profound financial impact on
individual soldiers and their families. Soldiers and their families
were required to spend considerable time, sometimes while the soldiers
were deployed in remote, combat environments overseas, continually
addressing concerns over their pay and allowances.
One of the primary causes for these pay problems is rooted in the
complex, cumbersome processes used to pay soldiers from their initial
mobilization through active duty deployment to demobilization. While
not designed as such, these pay operations have evolved over time to
the point that few, if any, in the department fully understand their
breadth, scope, and inherent weaknesses. Army Guard pay process
requirements, particularly in light of the potentially hundreds of
organizations and estimated thousands of personnel involved, were not
well understood or consistently applied with respect to determining (1)
the actions required to pay mobilized Army Guard soldiers timely and
accurately, and (2) the components responsible, among Army Guard,
active Army, and DFAS, for taking the required actions. Further, we
found several instances in which existing regulations were out of date-
-some of which still reflected practices in place in 1991 during
Operation Desert Storm. As a result, we found numerous errors in key
pay transactions at our case study locations.
For example, procedures relating to amending active duty orders were
problematic. For the Colorado Special Forces unit, we found that
actions taken by the Army Guard military pay officials in an attempt to
amend 34 soldiers' orders resulted in reversing the active duty pays
and allowances the soldiers received for 11 of the 12 months they were
deployed on active duty in Afghanistan. Instead, the system recorded
these pays and allowances as debts. These 34 soldiers received notice
on their Leave and Earnings Statements that they owed the government an
average of $48,000 per soldier, for a largely erroneous total debt of
$1.6 million. In another case, after exhausting all in-theatre
processes to initiate pays without success, a sergeant with an Army
Guard unit stationed in Uzbekistan had to make a time-consuming trip to
Kuwait and back in order to personally deliver pay information from his
unit to a finance office that could process Army Guard data. The trip
proved to be not only a major inconvenience but was also life
threatening, as the sergeant's aircraft came under enemy fire during
the course of his journey.
With respect to human capital at our case study units, we found
weaknesses, including (1) insufficient resources allocated to pay
processing, (2) inadequate training related to existing policies and
procedures, and (3) poor customer service. A sufficient number of well-
trained military pay staff is particularly crucial given the extensive,
cumbersome, and labor-intensive process requirements that have evolved
to support active duty pay to Army Guard soldiers. During our work at
the case study locations we audited, we identified instances in which
military pay technicians with the Army Guard and active Army finance
office locations made data coding errors when entering pay transactions
into the pay systems. We were told that these errors occurred because
military pay personnel--particularly those at the active Army finance
office locations--were unfamiliar with the system's pay processing
requirements for active duty pays to mobilized Army Guard personnel.
A related human capital issue--customer support for active duty pay
issues--was a recurring concern at our six case study locations. None
of the DOD, Army, or Army Guard policies and procedures we examined
addressed the level or quality of customer service that mobilized Army
Guard soldiers should be provided for questions or problems with their
active duty pays. For example, one soldier told us that he submitted
documentation on three separate occasions to support the housing
allowance he should have received as of the beginning of his October
2001 mobilization. Each time he was told to resubmit the documentation
because his previously submitted documents were lost. Subsequently,
while he was deployed, he made additional repeated inquiries concerning
when he would receive his housing allowance pay. He was told that it
would be taken care of when he returned from his deployment. However,
when he returned from his deployment, he was told that he should have
taken care of this issue while he was deployed and that it was now too
late to receive this allowance.
Several systems issues were also a significant factor impeding accurate
and timely payroll payments to mobilized Army Guard soldiers. The
system relied on to pay mobilized Army Guard soldiers--the Defense
Joint Military Pay System-Reserve Component (DJMS-RC)--was originally
designed to process payroll payments to Army Reserve and Army Guard
personnel on weekend drills, on short periods of annual active duty
(periods of less than 30 days in duration), or for training. With Army
Guard personnel now being paid from DJMS-RC for extended periods of
active duty (as long as 2 years at a time), DFAS officials told us that
the system is now stretched to the limits of its functionality. DFAS
has established "workarounds" to compensate for the DJMS-RC system
constraints. Overall, we found the current stove-piped, nonintegrated
systems were labor-intensive and require extensive error-prone manual
data entry and reentry. As a result, it was often difficult to ensure
that mobilized soldiers received only and all the pays and allowances
to which they were entitled, as illustrated in appendixes I-VI by our
six case studies. While DOD has plans to implement system improvements
in this area, it is likely that the department will be required to
operate within existing system constraints for at least several more
years.
Finally, our limited review of pays to one more recently activated Army
Guard military police unit deployed to Iraq in April 2003 to provide
military convoy security and carry out highway patrols indicated that
some of the same types of pay problems that we found in our six case
study units continued to occur. Of the 152 soldiers mobilized in this
unit, we identified 54 soldiers who were either overpaid, underpaid,
received entitled active duty pays and allowances over 30 days late, or
for whom erroneous pay-related debts were created. We found that these
pay problems could be attributed to control breakdowns similar to those
we found at our case study units, including input errors related to
amended orders, delays and errors in coding pay and allowance
transactions, and slow or nonexistent customer service response.
We are making a series of recommendations to address the Army Guard
active duty pay weaknesses we identified in the areas of process, human
capital, and systems. While DOD should take a number of immediate
actions to address these problems, we are also recommending that DOD
ensure that its longer-term reengineering and system improvement
efforts in this area include complete and lasting solutions to the
weaknesses identified. In its comments on a draft of this report, DOD
agreed with our recommendations and outlined its actions to address the
deficiencies noted in our report.
Background:
The Army Guard is the oldest component of any of the uniformed
services. It traces its roots to the colonial militia, and claims a
"birth"of 1636. Today, the Army Guard exists in 54 locations that
include all 50 states, the District of Columbia, and three territories:
Guam, the Virgin Islands, and Puerto Rico. There are about 2,300 Army
Guard units within these locations and over 350,000 Army Guard members.
During peacetime, Army Guard units report to the adjutant generals of
their states or territories, or in the case of the District of
Columbia, to the Commanding General. Each adjutant general reports to
the governor of the state, or in the case of the District of Columbia,
the mayor.
At the state level, the governors have the ability, under the
Constitution of the United States, to call up members of the Army Guard
in times of domestic emergency or need. The Army Guard's state mission
is perhaps the most visible and well known. Army Guard units battle
fires or help communities deal with floods, tornadoes, hurricanes,
snowstorms, or other emergency situations. In times of civil unrest,
the citizens of a state rely on the Army Guard to respond, if needed.
During national emergencies, however, the President has the authority
to mobilize the Army Guard, putting them in federal duty status. While
federalized, the units answer to the Combatant Commander of the theatre
in which they are operating and, ultimately, to the President. Even
when not federalized, the Army Guard has a federal mission to maintain
properly trained and equipped units, available for prompt mobilization
for war, national emergency, or as otherwise needed. Nonfederalized
Army Guard members' pay and allowances are paid with state funds while
federalized Army Guard members' pay and allowances are paid with
federal funds.
Typically, Army Guard members enlist for 8 years and are entitled to a
number of benefits while serving in the Army Guard, including those for
health care, life insurance, and other state-specific benefits. After
their enlistment periods, former Army Guard members are entitled to
veterans' benefits, such as veterans' health care and burial benefits.
Army Guard members are required to attend one drill weekend each month
and one annual training period (usually 2 weeks in the summer) each
year. Initially, all nonprior service personnel are required to attend
initial entry training, also known as Basic Training. After Basic
Training, soldiers go to their Advanced Individual Training, which
teaches them the special skills they will need for their jobs in the
Army Guard. This training can usually be scheduled to accommodate
civilian job or school constraints. The Army Guard has armories and
training facilities in more than 2,800 communities.
The Army Guard is a partner with the active Army and the Army Reserves
in fulfilling the country's military needs. The National Guard Bureau
(NGB) assists the Army Guard in this partnership. NGB is a joint bureau
of the Departments of the Army and the Air Force and is charged with
overseeing the federal functions of the Army Guard and the Air Guard.
In this capacity, NGB helps the Army Guard and the Air Guard procure
funding and administer policies. NGB also acts as a liaison between the
Departments of the Army and Air Force and the states.
All Army forces are integrated under DOD's "total force" concept. DOD's
total force concept is based on the premise that it is not practically
feasible to maintain active duty forces sufficient to meet all possible
war contingencies. Under this concept, DOD's active and reserve
components are to be blended into a cohesive total force to meet a
given mission.
On September 14, 2001, the President declared a national emergency as a
result of the terrorist attacks on the World Trade Center and the
Pentagon and the continuing and immediate threat of further attacks on
the United States. Concurrent with this declaration, the President
authorized the Secretary of Defense to call troops to active duty
pursuant to 10 U.S.C. Section 12302. The Secretary of Defense delegated
to the Secretary of the Army the authority to order Army Guard soldiers
to active duty as part of the overall mobilization effort.
Approximately 93,000 Army Guard soldiers were activated as of March
2003. At that time, Army Guard soldiers accounted for 34 percent of the
total reserve components[Footnote 3] mobilized in response to the
terrorist attacks on September 11, 2001.
The active duty federal missions established in response to the
September 2001 national emergency were categorized into two operations:
Operation Enduring Freedom and Operation Noble Eagle. In general,
missions to fight terrorism outside the United States were categorized
under Operation Enduring Freedom, while missions to provide domestic
defense were categorized as Operation Noble Eagle. For example, Army
Guard soldiers participated in direct combat in Afghanistan under
Operation Enduring Freedom. U.S. homeland security missions, such as
guarding the Pentagon, airports, nuclear power plants, domestic water
supplies, bridges, tunnels, and other military assets were conducted
under Operation Noble Eagle. The Army Guard also supported federal
peacekeeping operations in Southwest Asia with Operation Desert Spring
and in Kosovo with Operation Joint Guardian under various other
military operations.
While on active duty, all Army Guard soldiers earn various statutorily
authorized pays and allowances. The types of pay and allowances Army
Guard soldiers are eligible to receive vary depending upon rank and
length of service, dependency status, skills and certifications
acquired, duty location, and the difficulty of the assignment. While
Army Guard soldiers mobilized to active duty may be entitled to receive
additional pays and allowances, we focused on 14 basic types of pays
and allowances applicable to the Army Guard units we selected for case
studies. As shown in table 1, we categorized these 14 pay and allowance
types into two groups: (1) pays, including basic pay, special duty
assignment pay, parachute jumping and foreign language proficiency
skill-based pays, and location-based hostile fire and hardship duty
pays and (2) allowances, including allowances for housing, subsistence,
family separation, and cost of living for the continental United
States.[Footnote 4]
Table 1: Basic Pays and Allowances Associated with Case Study Units:
Pays: Basic pay; Description: Salary; Dollar amount: Varies depending
on rank and years of service.
Pays: Hazardous duty pay - jump pay; Description: Pay for parachute
jumping; Dollar amount: $150 per month.
Pays: Hazardous duty pay - jump pay - high altitude low opening pay;
Description: Pay for parachute jumping at high altitude without use of
a static line; Dollar amount: $225 per month.
Pays: Special duty assignment pay; Description: Pay to enlisted
soldiers performing duties that are particularly difficult or requiring
an unusual degree of responsibility; Dollar amount: Varies from $55 to
$375 per month.
Pays: Foreign language proficiency pay; Description: Pay for
specialized foreign language skills; Dollar amount: Varies depending on
proficiency but may not exceed $300 per month.
Pays: Diving duty pay; Description: Pay for diving duty or the
requirement to maintain proficiency as a diver; Dollar amount: Varies
according to service branch and proficiency but may not exceed $240 per
month for officers and $340 per month for enlisted members.
Pays: Hardship duty location pay for designated areas; Description: Pay
when assigned to duty in specified locations; Dollar amount: $50, $100,
or $150 per month (depending on duty location).
Pays: Hardship duty location pay for certain places (phase out began on
January 1, 2002); Description: Pay to enlisted soldiers when assigned
to duty in specified locations; Dollar amount: Varies from $8 to $22.50
per month depending on rank.
Pays: Hostile fire/imminent danger pay; Description: Full pay for any
portion of month assigned to a location subject to or in close
proximity to hostile fire or assigned to duty in a designated imminent
danger location; Dollar amount: $150 per month through September 30,
2002; $225 per month effective October 1, 2002 though September 30,
2003.
Allowances: Basic allowance for housing; Description: Meant to offset
the cost of housing when member does not receive government-provided
housing; Dollar amount: Varies depending on location, rank, and whether
member has dependents.
Allowances: Cost of living allowance in the continental United States;
Description: Meant to provide compensation for variations in costs
(other than housing) in the continental United States; Dollar amount:
Varies depending on location, rank, years of service, and whether
member has dependents.
Allowances: Basic allowance for subsistence; Description: Meant to
offset costs for a member's meals; Dollar amount: Varies depending on
whether member is officer or enlisted.
Allowances: Family separation allowance I; Description: Meant to
offset added housing expenses resulting from forced separation from
dependents; Dollar amount: Equivalent to monthly basic allowance for
housing for member of same rank without dependents.
Allowances: Family separation "allowance II; Description: Meant to
offset certain expenses resulting from forced separation from
dependents; Dollar amount: $100 per month from January 1, 1998,
through September 30, 2002; $250 per month effective October 1, 2002,
through September 30, 2003.
Source: GAO analysis.
[End of table]
In addition, Army Guard soldiers may be eligible for tax advantages
associated with their mobilization to active duty. That is, mobilized
Army Guard soldiers assigned to or working in a combat zone are
entitled to exclude from taxable income certain military pay that would
otherwise be taxable.[Footnote 5]
As shown in figure 1, there are three key phases associated with
starting and stopping relevant pays and allowances for mobilized Army
Guard soldiers: (1) initial mobilization (primarily through the Soldier
Readiness Processing), (2) deployment, which includes carrying out
assigned mission operations while on active duty, and (3)
demobilization.
Figure 1: Three Key Phases for Active Duty Pays to Army Guard Soldiers:
[See PDF for image]
[End of figure]
Army Guard units and state-level command support components, as well as
active Army finance components and DFAS, have key roles in this
process. In addition, there are five key computer systems involved in
authorizing, entering, and processing active duty pays to mobilized
Army Guard soldiers through the three key phases of their mobilization:
* Army's standard order writing system, Automated Fund Control Order
System (AFCOS);
* Army Guard's personnel system, Standard Installation Division
Personnel Reporting System (SIDPERS);
* Army Guard's pay input system, JUMPS Standard Terminal Input System
(JUSTIS);
* active Army's pay input system, Defense Military Pay Office System
(DMO); and:
* DFAS' Army Guard and Reserve pay system, DJMS-RC.
Initial Mobilization Phase:
During the initial mobilization, units receive an alert order and begin
a mobilization preparation program, Soldier Readiness Processing (SRP).
The financial portion of the SRP is conducted by one of the 54 United
States Property and Fiscal Offices (USPFO) to verify the accuracy of
pay records for each soldier and to make changes to pay records based
on appropriate supporting documentation for the pays and allowances
that the soldiers will be entitled to receive when initially mobilized.
If documentation, such as birth certificates for dependents or
parachute jumping certifications, is missing, soldiers have a few days
to obtain the necessary documents. The unit commander is responsible
for ensuring that all personnel data for each soldier under their
command are current.
When the unit receives a mobilization order, USPFO pay technicians are
responsible for initiating basic pay and allowances by manually
entering the start and stop dates into DJMS-RC[Footnote 6] for the
active duty tour that appears on each soldier's mobilization order.
Army Guard pay technicians use JUSTIS to access and record data in
DJMS-RC. By entering the soldier's Social Security number and
mobilization order number into JUSTIS, the pay technician can view the
pay data in DJMS-RC, ensure that they are complete, and enter any
missing data supported by documentation provided by the soldier. If
done correctly, soldiers will start to receive basic pay, basic
allowances for housing, basic allowances for subsistence, and jump pay
automatically based on the start date entered into DJMS-RC.
After soldiers complete their initial SRP and receive individual
mobilization orders, they travel as a unit to a mobilization station.
At the mobilization station, mobilized Army Guard personnel undergo a
second SRP review. In this second SRP, mobilization station personnel
are responsible for confirming or correcting the results of the first
SRP, including making necessary reviews to ensure that each soldier's
records are current. Mobilization pay technicians are required to
promptly initiate pays that were not initiated during the first SRP and
enter appropriate pay changes into DJMS-RC. The mobilization station
commander is required to certify that the unit is ready for
mobilization, including ensuring that all authorized active duty pays
are in place for the soldiers in the unit, at the end of this process.
DJMS-RC will generate certain pays and allowances automatically for
each 2-week pay period until the stop date entered in DJMS-RC. If
entered correctly, the stop date in DJMS-RC will be the end of active
duty tour date documented on the soldier's mobilization orders. This
automated feature is intended to prevent erroneous payments to soldiers
beyond their authorized active duty status. However, human intervention
is required when a pay or allowance error is detected or an event
occurs that requires a change in the soldier's pay and personnel file.
For example, a change in dependent status, such as marriage or divorce,
a promotion, jump pay disqualification, or being demobilized before an
active duty tour ends would change or eliminate some of the pays and
allowances a soldier would be entitled to receive. All pays and
allowances and subsequent changes are documented in the Master Military
Pay Account (MMPA)--the central pay record repository in DJMS-RC for
each soldier.
Deployed Phase:
While deployed on active duty, there are several Army Guard (USPFO),
active Army, and DFAS components involved in paying mobilized Army
Guard personnel. The active Army servicing finance office, which may be
within the United States or in a foreign country, is responsible for
initiating pays earned while the soldier is deployed, such as hostile
fire pay and hardship duty pay. Pay technicians start hostile fire pay
for each soldier listed on a battle roster or flight manifest.
Thereafter, hostile fire pay is automatically generated each pay
period. Other location-based pays, such as hardship duty, require pay
transactions each month. The servicing finance office for the deployed
phase is under the jurisdiction of the active Army. Active Army
servicing finance offices use DMO to enter pay transactions into DJMS-
RC. Under certain conditions, either active Army pay servicing offices
or USPFOs can process applicable pay-altering transactions, such as
those related to a soldier's early separation from active duty or a
soldier's death.
Demobilization Phase:
Upon completion of an active duty tour, soldiers normally return to the
same Army locations from which they were mobilized for demobilization
out-processing before returning to their home units. Demobilization
personnel, employed by the active Army or Army Guard, are required to
provide each soldier with a Release from Active Duty (REFRAD) order and
a Form DD 214, Certificate of Release or Discharge from Active Duty.
The demobilization station pay technicians are to use these documents
as a basis for deactivating the soldier's active duty pay and
allowances as of the date of release from active duty. At this time,
the supporting USPFO is responsible for discontinuing monthly input of
all nonautomated pays and allowances. If the demobilization station did
not take action to return a soldier to a demobilized status, the state
USPFO has this responsibility.
Military Pay Systems Environment:
In 1995, the Army decided to process pays to mobilized Army Guard
soldiers from the DJMS-RC system rather than the active Army payroll
system used to pay mobilized Army Guard soldiers previously. According
to the then Deputy Assistant Secretary of the Army (Financial
Operations), this decision was made as an interim measure (pending the
conversion to a single system to pay both active and reserve component
soldiers) based on the belief that DJMS-RC provides the best service to
the reserve component soldiers. DJMS-RC is a large, complex, and
sensitive payroll computer application used to pay Army and Air
National Guard and Army and Air Force Reserve personnel. DFAS has
primary responsibility for developing guidance and managing operations
of the system. DFAS Indianapolis is the central site for all Army
military pay and is responsible for maintaining over 1 million MMPAs
for the Army. Each MMPA contains a soldier's pay-related personnel,
entitlement, and performance data. All pay-related transactions that
are entered into DJMS-RC, through JUSTIS and DMO, update the MMPA.
Personnel data contained in the MMPA are generated from SIDPERS--a
personnel database maintained and used by the Army Guard at the 54
state-level personnel offices to capture data on personnel-related
actions (e.g. discharge, promotion, demotion actions that impact
soldiers' pay).
DFAS Denver is responsible for designing, developing, and maintaining
customer requirements for the Military and Civilian Pay Services
business line, and its Technical Support Office designs and maintains
the DJMS-RC core pay software. DFAS-Indianapolis serves as a
"gatekeeper" in that it monitors the daily status of data uploaded to
DJMS-RC to ensure that all transactions are received and processed in
DJMS-RC. Users can sign on to DJMS-RC directly through online
interactive software used for file transfer transactions, online
queries of MMPAs, and downloads of data files and various DJMS-RC
reports.
JUSTIS is the pay input subsystem used by the 54 state-level Army Guard
commands, including the USPFOs, to update DJMS-RC. Database management
of JUSTIS is decentralized in that each of the 54 sites owns and
maintains its own JUSTIS database. This subsystem processes
transactions for submission to DJMS-RC to create payments for Army
National Guard soldiers. JUSTIS receives certain pay-affecting
personnel data from SIDPERS.
JUSTIS receives a limited amount of mobilization order data directly
from AFCOS. These systems share the same operating system platform and
certain database tables. However, additional data needed to create pay
transactions associated with active duty pay and allowances must be
entered manually into JUSTIS from hard copies of mobilization orders.
DMO is the pay input subsystem used by active Army finance offices and
the DOD military pay offices, including those in overseas locations
such as Europe, Korea, and Iraq, to update DJMS-RC. This pay input
subsystem can be used by active Army finance offices to create
transactions for military pay and allowances that are not reported at
the time of mobilization for upload to DJMS-RC and for active Army
finance offices to use to enter location-based pays, such as hostile
fire and hardship duty pays and combat zone tax exclusion transactions.
Case Studies Illustrate Significant Pay Problems:
We found significant pay problems at the six Army Guard units we
audited. These problems related to processes, human capital, and
systems. The six units we audited, including three special forces and
three military police units, were as follows:
Special forces units:
* Colorado B Company, 5TH Battalion, 19TH Special Forces:
* Virginia B Company, 3RD Battalion, 20TH Special Forces:
* West Virginia C Company, 2ND Battalion, 19TH Special Forces:
Military police units:
* Mississippi 114TH Military Police Company:
* California 49th Military Police Headquarters and Headquarters
Detachment:
* Maryland 200TH Military Police Company:
In addition, we conducted a limited review of the pay experiences of a
seventh unit mobilized more recently and deployed to Iraq in April
2003--the Colorado Army Guard's 220th Military Police Company--to
determine the extent to which the pay problems we found in our six case
study units persisted. As shown in figure 2, these units were deployed
to various locations in the United States and overseas in support of
Operations Noble Eagle and Enduring Freedom.
Figure 2: Units and Deployment Locations:
[See PDF for image]
[End of figure]
These units were deployed to help perform a variety of critical mission
operations, including search and destroy missions in Afghanistan
against Taliban and al Qaeda forces, guard duty for al Qaeda prisoners
in Cuba, providing security at the Pentagon shortly after the September
11, 2001, terrorist attacks, and military convoy security and highway
patrols in Iraq.
For the six units we audited, we found significant pay problems
involving over one million dollars in errors. These problems consisted
of underpayments, overpayments, and late payments that occurred during
all three phases of Army Guard mobilization to active duty. Overall,
for the 18-month period from October 1, 2001, through March 31, 2003,
we identified overpayments,[Footnote 7] underpayments, and late
payments at the six case study units estimated at $691,000, $67,000,
and $245,000, respectively. In addition, for one unit, these pay
problems resulted in largely erroneous debts totaling $1.6 million.
Overall, we found that 450 of the 481 soldiers from our case study
units had at least one pay problem associated with their mobilization
to active duty. Table 2 shows the number of soldiers with at least one
pay problem during each of the three phases of active duty
mobilization.
Table 2: Pay Problems at Six Case Study Units:
Army Guard unit: Colorado Special Forces; Soldiers with pay problems:
Mobilization: 56 of 62; Soldiers with pay problems: Deployment: 61 of
62; Soldiers with pay problems: Demobilization: 53 of 62.
Army Guard unit: Virginia Special Forces; Soldiers with pay problems:
Mobilization: 31 of 65; Soldiers with pay problems: Deployment: 63 of
65; Soldiers with pay problems: Demobilization: 60 of 65.
Army Guard unit: West Virginia Special Forces; Soldiers with pay
problems: Mobilization: 36 of 94; Soldiers with pay problems:
Deployment: 84 of 94; Soldiers with pay problems: Demobilization: 66 of
94.
Army Guard unit: California Military Police; Soldiers with pay
problems: Mobilization: 48 of 51; Soldiers with pay problems:
Deployment: 41 of 51; Soldiers with pay problems: Demobilization: 0 of
51.
Army Guard unit: Maryland Military Police; Soldiers with pay problems:
Mobilization: 75 of 90; Soldiers with pay problems: Deployment: 64 of
90; Soldiers with pay problems: Demobilization: 3 of 90.
Army Guard unit: Mississippi Military Police; Soldiers with pay
problems: Mobilization: 21 of 119; Soldiers with pay problems:
Deployment: 93 of 119; Soldiers with pay problems: Demobilization: 90
of 119.
Source: GAO analysis.
[End of table]
Due to the lack of supporting documents at the state, unit, and
battalion levels, we may not have identified all of the pay problems
related to the active duty mobilizations of these units. We have
provided documentation for the pay problems we identified to
appropriate DOD officials for further research to determine whether
additional amounts are owed to the government or the soldiers. The
payment problems we identified at the six case study units did not
include instances of fraudulent payments, which were a major finding
resulting from the further investigation of improper payments found in
our 1993 audit of Army military payroll.[Footnote 8] Nonetheless, we
found the inaccurate, late, and missing pays and associated erroneous
debts found during our current audit had a profound financial impact on
individual soldiers and their families. Some of the pay problems we
identified included the following.
* DOD erroneously billed 34 soldiers in a Colorado National Guard
Special Forces unit an average of $48,000 each. Though we first
notified DOD of these issues in April and sent a follow-up letter in
June 2003, the largely erroneous total debt for these soldiers of about
$1.6 million remained unresolved at the end of our audit in September
2003.
* As a result of confusion over responsibility for entering
transactions associated with a Colorado soldier's promotion, the
soldier's spouse had to obtain a grant from the Colorado National Guard
to pay bills while her husband was in Afghanistan.
* Some soldiers did not receive payments for up to 6 months after
mobilization and others still had not received certain payments by the
conclusion of our audit work.
* Ninety-one of 100 members of a Mississippi National Guard military
police unit that was deployed to Guantanamo Bay, Cuba, did not receive
the correct amount of Hardship Duty Pay.
* One soldier from the Mississippi unit was paid $9,400 in active duty
pay during the 3 months following an early discharge for drug-related
charges.
* Forty-eight of 51 soldiers in a California National Guard military
police unit received late payments because the unit armory did not have
a copy machine available to make copies of needed pay-related
documents.
* Four Virginia Special Forces soldiers who were injured in Afghanistan
and unable to resume their civilian jobs experienced problems in
receiving entitled active duty pays and related health care.
In some cases, the problems we identified may have distracted these
professional soldiers from mission requirements, as they spent
considerable time and effort while deployed attempting to address these
issues. Further, these problems may adversely affect the Army's ability
to retain these valuable personnel. Appendixes I-VI provide details of
the pay experiences of the soldiers at the case study units we audited.
Significant Weaknesses in Processes over Mobilized Army Guard Pay:
Procedural requirements, particularly in light of the potentially
hundreds of organizations and thousands of personnel involved, were not
well understood or consistently applied with respect to determining (1)
the actions required to make timely, accurate active duty pays to
mobilized Army Guard soldiers and (2) the component responsible, among
Army Guard, active Army, and DFAS, for taking the required actions.
Further, we found instances in which existing guidance was out of date-
-some of which still reflected practices in place in 1991 during
Operation Desert Storm. These complex, cumbersome processes, which were
developed in piecemeal fashion over a number of years, provide numerous
opportunities for control breakdowns. We found that a substantial
number of payment errors were caused, at least in part, by unclear
procedural requirements for processing active duty pay and allowance
entitlements to mobilized Army Guard soldiers.
Complex, Cumbersome, and Evolving Processes:
Overall, as shown in figures 3, 4 and 5, we found that an extensive,
cumbersome, and labor-intensive process has evolved to pay mobilized
Army Guard soldiers for their active duty service.
Figure 3: Initial Mobilization Phase Process:
[See PDF for image]
[End of figure]
Figure 4: Deployed Phase Process:
[See PDF for image]
[End of figure]
Figure 5: Demobilization Phase Process:
[See PDF for image]
[End of figure]
While figures 3, 4 and 5 provide an overview of the process,
particularly of the types of DOD organizations involved, they do not
fully capture the numbers of different DOD components involved.
Specifically, thousands of Army Guard (individual units and state-level
organizations), active Army, and DFAS components may be involved in
authorizing, processing, and paying mobilized Army Guard soldiers,
including:
* an estimated 2,300 local Army Guard home units, unit commanders, and
unit administrators that are involved in maintaining up-to-date soldier
personnel and related pay records;
* 54 state-level Army Guard commands, including both USPFOs and state-
level personnel offices involved in authorizing and starting active
duty pay transactions;
* active Army finance offices or DOD Military Pay Offices at over 15
mobilization stations across the United States that are involved in
processing Army Guard personnel to and from their active duty
locations;
* 28 active Army area servicing finance offices at over 50 locations
worldwide that are involved in servicing Army Guard soldiers' location-
based active duty pays;
* DFAS-Indianapolis--the central site for processing Army Guard
soldiers' active duty pays;
* DFAS-Denver--the central site for maintaining the pay system used to
pay Army Guard soldiers;
* DFAS-Cleveland--the central site for handling soldier military pay
inquiries; and:
* The Army National Guard Financial Services Center--the Army Guard
organization responsible for providing guidance, training, and
oversight and coordination for active duty pays to Army Guard
personnel.
Several of these organizations with key roles in payroll payments to
mobilized Army Guard soldiers, including DOD, DFAS, Army, and the Army
Guard, have issued their own implementing regulations, policies, and
procedures. In addition, we found unwritten practices in place at some
of the case study locations we audited. Existing written policies and
procedures are voluminous--the DOD Financial Management Regulations
(FMR) guidance on pay and allowance entitlements alone covers 65
chapters. As a result of their size and continually evolving nature as
legal, procedural, and system requirements change, we found that
policies and procedures were not well understood or consistently
applied across the potentially hundreds of organizations and thousands
of personnel involved in paying mobilized Army Guard personnel. These
processes have been developed in piecemeal fashion over a number of
years to accommodate changing legislative requirements, DOD policies,
and the unique operating practices of different DOD organizations and
systems involved in these processes.
As discussed in the following sections, these extensive and evolving
policies and procedures were confusing both across various
organizations and personnel involved in their implementation and, more
importantly, to the Army Guard soldiers who are the intended
beneficiaries. In addition, these cumbersome policies and procedures
contributed to the pay errors we identified.
Procedural Requirements Not Clear:
We found instances in which unclear procedural requirements for
processing active duty pays contributed to erroneous and late pays and
allowances to mobilized Army Guard soldiers. For example, we found
existing policies and procedural guidance were unclear with respect to
the following issues.
Amending active duty orders. A significant problem we found at the case
study locations we audited concerned procedures that should be followed
for amending active duty orders. We found instances at two of our case
study locations in which military pay technicians at either a USPFO or
an active Army finance office made errors in amending existing orders.
These errors resulted in establishing virtually all prior pays made
under the original orders as debts. A major contributor to the pay
errors we found in this area was that existing procedures did not
clearly state how USPFO and active Army finance personnel should modify
existing order tour start and stop information in the pay system when
necessary without also unintentionally adversely affecting previous
pays and allowances. Also, these procedures did not warn USPFO and
active Army personnel that using alternative methods will automatically
result in an erroneous debt assessment and garnishment of up to two-
thirds of the soldier's pay.
We identified over $1 million in largely erroneous debt transactions as
a result of breakdowns in this area. At the Colorado Special Forces
unit, we found that actions taken by the Colorado USPFO in an attempt
to amend 34 soldiers' orders resulted in reversing the active pay and
allowances the soldiers received for 11 of the 12 months they were
deployed on active duty in Afghanistan and instead establishing these
payments as debts. These 34 soldiers received notice on their Leave and
Earnings Statements that they owed the government an average of
approximately $48,000 per soldier, for a total largely erroneous debt
of $1.6 million. Although we informed DOD of this problem in April
2003, as of the end of our audit fieldwork in September 2003, the
problems at the Colorado Special Forces unit had not been resolved. DOD
officials did advise us that, as a result of our work, they implemented
a software change on September 18, 2003, intended to help avoid such
problems in the future. Specifically, we were told new warning messages
have been added to JUSTIS that will appear when a transaction is
entered to cancel or amend a tour of duty. The new warnings will advise
that the transaction will or could result in a collection action and
will ask the pay technician to confirm that is their intent. While we
did not verify the effectiveness of this change, it has the potential
to reduce pay problems associated with errors made in amending orders.
Required time frames for processing pay transactions. Written
requirements did not exist with respect to the maximum amount of time
that should elapse between the receipt by the responsible Army Guard or
Army pay office of proper documentation and processing the related pay
transaction through the pay system. While some of the locations we
audited had established informal processing targets, for example, 3
days, we also found numerous instances in which available documentation
indicated lengthy delays in processing pay transactions after pay
offices received supporting documentation. These lengthy processing
delays resulted in late payroll payments to deployed soldiers.
Required monthly reconciliations of pay and personnel data. The case
study units lacked specific written requirements for conducting and
documenting monthly reconciliations of pay and personnel mismatch
reports and unit commanders' finance reports. Available documentation
showed that these controls were either not done or were not done
consistently or timely. Because, as discussed later in this report, the
processing of Army Guard pay relies on systems that are not integrated
or effectively interfaced, these after-the-fact detective controls are
critical to detecting and correcting erroneous or fraudulent pays.
To be effective, the 54 state-level Army Guard commands must
individually reconcile common data elements in all 54 state-operated
personnel databases for Army Guard personnel with corresponding DJMS-RC
pay records at least monthly. Because of the lack of clarity in
existing procedural requirements in this area, we found that several of
the locations we visited had established standard but undocumented
reconciliation practices. However, at the six case study locations we
audited, we found that although all the USPFOs told us they received
monthly SIDPERS and DJMS-RC mismatch reports, they did not always fully
reconcile and make all necessary system corrections each month. Lacking
specific written policies and procedural requirements for such
reconciliations, several of the case study locations we audited
established a standard, but undocumented, practice of reconciling
roughly a third of the common data elements every month, so that all
elements were to be reconciled and all necessary corrective actions
taken over a 3-month period. However, documentation was not always
retained to determine the extent to which these reconciliations were
done and if they were done consistently.
Our findings are similar to those in reports from Army Guard
operational reviews. For example, the results of the most recent
reviews at three of the six case study locations we audited showed that
state Army Guard personnel were not performing effective
reconciliations of pay and personnel record discrepancies each month.
One such report[Footnote 9] concluded, "Failure to reconcile the
Personnel/Pay Mismatch listing monthly provides a perfect opportunity
to establish fraudulent personnel or pay accounts.":
Several of the instances we identified in which soldiers received pay
and allowances for many months after their release from active duty
likely would have been identified sooner had USPFO military pay
personnel investigated the personnel/pay mismatch report discrepancies
more frequently. For example, at one case study unit, 34 soldiers
received pay for several months past their official discharge dates.
Although records were not available to confirm that these overpayments
were reported as discrepancies on monthly mismatch reports, the USPFO
military pay supervisor told us that at the time the mismatch reports
were not being used to identify and correct pay-affecting errors.
As discussed later, at another case study unit, a mobilized soldier was
released from active duty and discharged from the Army in June 2002,
earlier than his planned release date due to alleged involvement in
drug-related activities. But, the soldier continuied to receive active
duty pay. The soldier's SIDPERS personnel record on July 2, 2002, to
reflect the discharge. According to pay records, the soldier's pay
continued until the USPFO military pay supervisor identified the
discrepancy on the September 25, 2002, personnel/pay mismatch report
and initiated action that stopped the soldier's pay effective September
30, 2002. However, because this discrepancy was not identified until
late September, the soldier received $9,400 in extra pay following his
discharge from the Army.
In addition, while as discussed previously, we found a number of
instances in which Army Guard soldiers' active duty pays continued
after their demobilization, available documentation showed only one
instance in the six case study units we visited in which a
reconciliation of the unit commander's finance report resulted in
action to stop improper active duty pay and allowances. Specifically,
available documentation shows that an administrative clerk's review of
this report while the unit was mobilized in Guantanamo Bay, Cuba,
resulted in action to stop active duty pay and allowances to a soldier
who was previously demobilized. However, it is also important to note
that while these reconciliations are an important after-the-fact
detective control, they are limited because they can only detect
situations in which payroll and personnel records do not agree. A
number of pay errors we identified resulted from the fact that neither
personnel nor pay records were updated.
Soldiers returning from deployments earlier than their units. For four
of our case study units, we found instances in which Army Guard
soldiers' active duty pays were not stopped at the end of their active
duty tours when they were released from active duty earlier than their
units. We found procedural guidance did not clearly specify how to
carry out assigned responsibilities for soldiers who return from active
duty earlier than their units. DFAS-Indianapolis guidance provides only
that "the supporting USPFO will be responsible for validating the
status of any soldier who does not return to a demobilized status with
a unit." The guidance did not state how the USPFO should be informed
that a soldier did not return with his or her unit, or how the USPFO
was to take action to validate the status of such soldiers. At one of
our case study locations, officials at the USPFO informed us that they
became aware that a soldier had returned early from a deployment when
the soldier appeared at a weekend drill while his unit was still
deployed.
Data input and eligibility requirements for housing and family
separation allowances. Our audit work at two of our case study
locations indicated that procedural guidance was not clear with respect
to transaction entry and eligibility requirements for the basic
allowance for housing and the family separation allowance,
respectively. For example, during our audit work at one of our case
study locations, we determined that because of inconsistent
interpretations of existing guidance for "dependents" in entering
transactions to start paying soldiers' basic allowance for housing, a
number of Maryland soldiers were not paid the correct amount. At
another case study location, we found that existing guidance on
eligibility determination was misinterpreted so that soldiers were
erroneously refused the "single parent soldiers family separation
allowance" to which they were entitled.
Organizational Responsibilities Not Clear:
We also found that existing policies and procedures were unclear with
respect to organizational responsibilities. Confusion centered
principally around pay processing responsibility for Army Guard
soldiers as they move from state control to federal control and back
again. To be effective, current processes rely on close coordination
and communication between state (Army Guard unit and state-level
command organizations) and federal (active Army finance locations at
mobilization/demobilization stations and at area servicing finance
offices). However, we found a significant number of instances in which
critical coordination requirements were not clearly defined.
DFAS Indianapolis mobilization procedures authorize the Army Guard's
USPFOs and the active Army's mobilization station and in-theater
finance offices to enter transactions for deployed soldiers. However,
we found existing guidance did not provide for clear responsibility and
accountability between USPFOs and active Army mobilization stations and
in-theater servicing finance offices with respect to responsibility for
entering transactions while in-theater and terminating payments for
soldiers who separate early or who are absent without leave or are
confined. For example, at one of our case study locations, we found
that this broad authority for entering changes to soldiers' pay records
enabled almost simultaneous attempts by two different pay offices to
enter pay transactions into DJMS-RC for the same soldier.
As shown in the following illustration, at another case study location
we found that, in part because of confusion over responsibility for
starting location-based pays, a soldier was required to carry out a
dangerous multiday mission to correct these payments.
[See PDF for image]
[End of figure]
[See PDF for image]
[End of figure]
While guidance that permits both Army Guard and active Army military
pay personnel to enter transactions for mobilized Army Guard soldiers
provides flexibility in serving the soldiers, we found indications that
it also contributed to soldiers being passed between the active Army
and Army Guard servicing locations. For example, at another of our case
study locations, we were told that several mobilized soldiers sought
help in resolving active duty pay problems from the active Army's
mobilization station finance office at Fort Knox and later the finance
office at Fort Campbell. However, officials at those active Army
locations directed the soldiers back to the USPFO because they were
Army Guard soldiers.
We also found procedures were not clear on how to ensure timely
processing of active duty medical extensions for injured Army Guard
soldiers. Army Regulation 135-381 provides that Army Guard soldiers who
are incapacited as a result of injury, illness, or disease that occured
while on active duty for more than 30 consecutive days are eligible for
continued health benefits. That is, with medical extension status,
soldiers are entitled to continue to receive active duty pays,
allowances, and medical benefits while under a physician's care.
At the Virginia 20TH Special Forces, B Company, 3RD Battalion, we found
that four soldiers were eligible for continued active duty pay and
associated medical benefits due to injuries incurred as a result of
their involvement in Operation Enduring Freedom. Although these
injuries precluded them from resuming their civilian jobs, they
experienced significant pay problems as well as problems in receiving
needed medical care, in part, as a result of the lack of clearly
defined implementing procedures in this area. All four soldiers
experienced pay disruptions because existing guidance was not clear on
actions needed to ensure that these soldiers were retained on active
duty medical extensions. One of the soldiers told us, "People did not
know who was responsible for what. No one knew who to contact or what
paperwork was needed…." As a result, all four have experienced gaps in
receiving active duty pay and associated medical benefits while they
remained under a physician's care for injuries received while on their
original active duty tour.
:
[See PDF for image]
[End of figure]
Guidance Outdated:
We found several instances in which existing DOD and Army regulations
and guidance in the pay and allowance area are outdated and conflict
with more current legislative and DOD guidance. Some existing guidance
reflected pay policies and procedures dating back to Operations Desert
Shield and Desert Storm in 1991. While we were able to associate pay
problems with only one of these outdated requirements, there is a risk
that they may also have caused as yet unidentified pay problems.
Further, having out-of-date requirements in current regulations may
contribute to confusion and customer service issues.
For example, the National Defense Authorization Act for Fiscal Year
1998 replaced the basic allowance for quarters and the variable housing
allowance with the basic allowance for housing.[Footnote 10] However,
volume 7A, chapter 27 of the DOD FMR, dated February 2002, still refers
to the basic allowance for quarters and the variable housing allowance.
The act also replaced foreign duty pay with hardship duty pay.[Footnote
11] Yet, chapter 8 of Army Regulation 37-104-4 (Military Pay and
Allowances Policy and Procedures - Active Component) still refers to
foreign duty pay.
Further, current DFAS and Army mobilization procedural guidance directs
active Army finance units to use transaction codes to start soldiers'
hardship duty pays that are incorrect. Effective December 2001, DOD
amended FMR, Volume 7A, chapter 17, to establish a new "designated
area" hardship duty pay with rates of $50, $100, or $150 per month,
depending on the area. However, DFAS guidance dated December 19, 2002,
directed mobilization site finance offices to use transaction codes
that resulted in soldiers receiving a prior type of hardship duty pay
that was eliminated in the December 2001 revisions. At one of our case
study locations, we found that because the active Army finance office
followed the outdated DFAS guidance for starting hardship duty pays, 91
of 100 Mississippi military police unit soldiers deployed to Cuba to
guard al Qaeda prisoners were paid incorrect amounts of hardship duty
pay.
In addition, Army Regulation 37-104-4, dated September 1994, which was
still in effect at the end of our audit work, provides that mobilized
Army Guard soldiers are to be paid through the active Army pay system-
-the Defense Joint Military Pay System-Active Component (DJMS-AC). This
procedure, in effect during the mobilizations to support Operations
Desert Shield and Desert Storm, was changed in 1995. Specifically, in
1995, it was agreed that Army Guard personnel would no longer be moved
to the active duty pay system, DJMS-AC, when mobilized to active duty,
but would remain on the DJMS-RC system. Maintaining such outdated
references in current policies may have contributed to confusion by
USPFO and active Army finance personnel regarding required actions,
particularly in light of the extensive set of policies and procedures
now in effect in this area.
Human Capital Issues Affect Ability to Pay Mobilized Army Guard
Soldiers Promptly and Accurately:
With respect to human capital, we found weaknesses, including (1)
insufficient resources allocated to pay processing, (2) inadequate
training related to existing policies and procedures, and (3) poor
customer service. The lack of sufficient numbers of well-trained,
competent military pay professionals can undermine the effectiveness of
even a world-class integrated pay and personnel system. A sufficient
number of well-trained military pay staff is particularly crucial given
the extensive, cumbersome, and labor-intensive process requirements
that have evolved to support active duty pay to Army Guard soldiers.
GAO's Standards for Internal Control in the Federal Government states
that effective human capital practices are critical to establishing and
maintaining a strong internal control environment. Specifically,
management should take steps to ensure that its organization has the
appropriate number of employees, and that appropriate human capital
practices, including hiring, training, and retention, are in place and
effectively operating.
Insufficient Numbers of Military Pay Processing Personnel:
Our audit identified concerns with the numbers of knowledgeable
personnel dedicated to entering and processing active duty pays and
allowances to mobilized Army Guard soldiers. As discussed previously,
both active Army and Army Guard military pay personnel play key roles
in this area. Army Guard operating procedures provide that the primary
responsibility for administering Army Guard soldiers' pay as they are
mobilized to active duty rests with the 54 USPFOs. These USPFOs are
responsible for processing pay for drilling reservists along with the
additional surge of processing required for initiating active duty pays
for mobilized soldiers.
Our audit work identified concerns with the human capital resources
allocated to this area, primarily with respect to the Army Guard
military pay processing at the state-level USPFOs. Specifically, we
identified concerns with (1) the number of staff on board in the
military pay sections of the USPFOs, (2) the relatively lower grade
structure for nonsupervisory personnel in the USPFOs' military pay
sections in comparison with the grades for similar positions in other
sections of the USPFO which led to difficulty in recruiting and
retaining military pay processing personnel, and (3) as discussed in
the following section, few of the military pay technicians on board at
the six locations we audited had received formal training on pay
eligibility and pay processing requirements for mobilized Army Guard
personnel.
NGB provides annual authorization for the overall staffing levels for
each state. Within these overall staffing authorizations, each state
allocates positions to each of the sections within a USPFO, including
the military pay section and other sections such as vendor and contract
pay. We compared the actual number of personnel on board to the NGB-
authorized staffing level for the military pay sections at the case
study locations we audited. During our audit period, two of the six
case study locations had fewer military pay technicians on board than
they were authorized.
Officials at several of the six case study units also stated that
restrictions on rank/grade at which USPFOs are allowed to hire
personnel for their military pay sections made it difficult to recruit
and retain employees. For example, a USPFO official told us that
retaining personnel in the military pay section of the USPFOs was
particularly difficult because similar administrative positions in
other sections of the USPFO were typically higher paying and provided
better benefits than the positions in the military pay section. The
highest pay grade of the nonsupervisory pay technicians at the six case
study units was a GS-7, and the majority of personnel were in the GS-6
pay grade.
Although the Army and DFAS have established an agreement that in part
seeks to ensure that resources are available to provide appropriately
skilled pay personnel at mobilization stations to support surge
processing, no such contingency staffing plan exists for the USPFOs.
Specifically, a November 2002 memorandum of understanding between the
Army and DFAS states that the active Army has primary responsibility to
provide trained military or civilian resources to execute active duty
pay and allowance surge processing requirements. However, this
memorandum does not address the resources needed for surge processing
at USPFOs. As discussed previously, pay problems at the case study
units were caused in part by USPFO military pay sections attempting to
process large numbers of pay transactions without sufficient numbers of
knowledgeable personnel.
Lacking sufficient numbers of personnel undermines the ability of the
USPFO pay functions to carry out established control procedures. For
example, our audits at several of the six case study units showed that
there were no independent reviews of proposed pay transactions before
they were submitted to DJMS-RC for processing. Such independent
supervisory reviews are required by DJMS-RC operating procedures.
However, a USPFO official told us that because of the limited number of
pay technicians available to process pay transactions--particularly
when processing massive numbers of transactions to start active duty
pays at the same time--this requirement was often not followed.
The Chief of Payroll at one of our case study locations told us that
because they were currently understaffed, staff members worked 12 to 14
hours a day and still had backlogs of pay start transactions to be
entered into the pay system. We were also told that two of our other
case study locations experienced backlogs and errors in entering pay
start transactions when they were processing large numbers of Army
Guard soldiers during initial mobilizations. Military pay personnel
told us that they were able to avoid backlogs in processing pay start
transactions during mobilization processing by conscripting personnel
from other USPFO sections to help in assembling and organizing the
extensive paperwork associated with activating appropriate basic pays,
entitlements, and special incentive pays for their mobilized Army Guard
soldiers.
Training on Pay Entitlement and Processing Requirements Critical:
In addition to concerns about the numbers of personnel onboard at the
USPFO military pay offices involved in processing pay transactions for
our case study units, we identified instances in which the personnel at
military pay offices at both the USPFOs and the active Army finance
offices did not appear to know the different aspects of the extensive
pay eligibility or payroll processing requirements used to provide
accurate and timely pays to Army Guard soldiers. There are no DOD or
Army requirements for military pay personnel to receive training on pay
entitlements and processing requirements associated with mobilized Army
Guard soldiers or for monitoring the extent to which personnel have
taken either of the recently established training courses in the area.
Such training is critical given that military pay personnel must be
knowledgeable about the extensive and complex pay eligibility and
processing requirements. We also found that such training is
particularly important for active Army pay personnel who may have
extensive experience and knowledge of pay processing requirements for
regular Army soldiers, but may not be well versed in the unique
procedures and pay transaction entry requirements for Army Guard
soldiers.
During our work at the case study units, we identified numerous
instances in which military pay technicians at both the USPFOs and
active Army finance office locations made data coding errors when
entering transaction codes into the pay systems. We were told that
these errors occurred because military pay personnel--particularly
those at the active Army finance office locations--were unfamiliar with
the system's pay processing requirements for active duty pays to
mobilized Army Guard personnel. Correcting these erroneous transactions
required additional labor-intensive research and data entry by other
more skilled pay technicians. As discussed previously, we also found
that pay technicians did not understand how to properly code data on
the soldiers' dependents status, which is used to determine housing
allowances, into the pay system. As a result, we identified cases in
which soldiers were underpaid housing allowances to which they were
entitled.
Personnel at active Army finance offices told us that while they are
readily familiar with the pay processing requirements for active Army
personnel (using DJMS-AC), they had little experience with, or training
in, the policies and procedures to be followed in entering pay
transactions into DJMS-RC. An Army finance office official told us that
handling two sets of pay transaction processing procedures is often
confusing because they are often required to process a large number of
both active Army personnel and Army Guard and other reserve personnel
using different processes and systems at the same time.
While the Army Guard offers training for their military pay
technicians, we found that there was no overall monitoring of Army
Guard pay personnel training. At several of the case study locations we
audited, we found that Army Guard pay technicians relied primarily on
on-the-job-training and phone calls to the Army Guard Financial
Services Center in Indianapolis or to other military pay technicians at
other locations to determine how to process active duty pays to
activated Army Guard personnel.
Beginning in fiscal year 2002, the Army Guard began offering training
on mobilization pays and transaction processing to the USPFO military
pay technicians. However, there is no requirement for USPFO pay
technicians to attend these training courses. In addition, available
documentation showed that two of the five scheduled courses for fiscal
year 2003 were canceled--one because of low registration and one
because of schedule conflicts.
Only two of the six case study locations we audited tracked the extent
to which pay technicians have taken training in this area. We were told
that few of the military pay technicians at the state Army Guard USPFOs
we audited had formal training on JUSTIS, DJMS-RC, or mobilization pay
processing requirements and procedures. Throughout our case studies, we
found numerous errors that involved some element of human capital. One
payroll clerk told us that she had not received any formal training on
how to operate JUSTIS when she was assigned to the job. Instead, she
stated, she has learned how to operate the system through on-the-job
training and many phone calls to system support personnel in
Indianapolis. She estimated that she was not fully comfortable with all
the required transaction processing procedures until she had been on
the job for about 7 years.
In addition, unit commanders have significant responsibilities for
establishing and maintaining the accuracy of solders' pay records. U.S.
Army Forces Command Regulation 500-3-3, Reserve Component Unit
Commander's Handbook (July 15, 1999) requires unit commanders to (1)
annually review and update pay records for all soldiers under their
command as part of an annual soldier readiness review and (2) obtain
and submit supporting documentation needed to start entitled active
duty pay and allowances based on mobilization orders. However, we saw
little evidence the commanders of our case study units carried out
these requirements. Further, neither Army Guard unit commanders nor
active Army commanders were required to receive training on the
importance of the pay to on-board personnel reconciliations, discussed
previously, as an after-the-fact detective control to proactively
identify Army Guard soldiers who should no longer receive active duty
pays. We were told that this was primarily because unit commanders have
many such administrative duties, and without additional training on the
importance of these actions, they may not receive sufficient priority
attention.
The lack of unit commander training on the importance of these
requirements may have contributed to the pay problems we identified at
our case study units. For example, at our Virginia case study location,
we found that when the unit was first mobilized, USPFO pay personnel
were required to spend considerable time and effort to correct hundreds
of errors in the unit's pay records dating back to 1996. Such errors
could have been identified and corrected during the preceding years'
readiness reviews. Further, we observed many cases in which active duty
pays were not started until more than 30 days after the entitled start
dates because soldiers did not submit the paperwork necessary to start
these pays.
Customer Service Concerns:
Through data collected directly from selected soldiers and work at our
six case study locations, we identified a recurring soldier concern
with the level and quality of customer service they received associated
with their pays and allowances when mobilized to active duty. None of
the DOD, Army, or Army Guard policies and procedures we examined
addressed the level or quality of customer service that mobilized Army
Guard soldiers should be provided concerning questions or problems with
their active duty pays. However, we identified several sources that
soldiers may go to for customer service or information on any such
issues. These include:
* their home unit,
* the military pay section of the USPFO of their home state's Army
Guard,
* the designated active Army area servicing finance office, and:
* a toll free number, 1-888-729-2769 (Pay Army).
While soldiers had multiple sources from which they could obtain
service, we found indications that many Army Guard soldiers were
displeased with the customer service they received. We found that not
all Army Guard soldiers and their families were informed at the
beginning of their mobilization of the pays and allowances they should
receive while on active duty. This information is critical for enabling
soldiers to identify if they were not receiving such pays and therefore
require customer service. In addition, as discussed later in this
report, we found that the documentation provided to Army Guard
soldiers--primarily in the form of leave and earnings statements--
concerning the pays and allowances they received did not facilitate
customer service. Our audit identified customer service concerns at all
three phases of the active duty tours and involving DFAS, active Army,
and Army Guard servicing components.
Consistent with the confusion we found among Army Guard and active Army
finance components concerning responsibility for processing pay
transactions for mobilized Army Guard soldiers, we found indications
that the soldiers themselves were similarly confused. Many of the
complaints we identified concerned confusion over whether Army Guard
personnel mobilized to active duty should be served by the USPFO
because they were Army Guard soldiers or by the active Army because
they were mobilized to federal service.
[See PDF for image]
[End of figure]
Data collected from Army Guard units mobilized to active duty indicated
that some members of the units had concerns with the pay support
customer service they received associated with their mobilization--
particularly with respect to pay issues associated with their
demobilization. Specifically, of the 43 soldiers responding to our
question on satisfaction with customer support during the mobilization
phase, 10 indicated satisfaction, while 15 reported
dissatisfaction.[Footnote 12] In addition, of the 45 soldiers
responding to our question on customer support following
demobilization, 5 indicated satisfaction while 29 indicated
dissatisfaction.[Footnote 13] Of the soldiers who provided written
comments about customer service, none provided any positive comments
about the customer service they received, and several had negative
comments about the customer service they received, including such
comments as "nonexistent," "hostile," or "poor." For example, a company
commander for one of our case study units told us that he was
frustrated with the level of customer support his unit received during
the initial mobilization process. Only two knowledgeable military pay
officials were present to support active duty pay transaction
processing for the 51 soldiers mobilized for his unit. He characterized
the customer service his unit received at initial mobilization as time
consuming and frustrating.
Personnel we talked with at the Colorado special forces unit we audited
were particularly critical of the customer service they received both
while deployed in Afghanistan and when they were demobilized from
active duty. Specifically, unit officials expressed frustration with
being routed from one office to another in their attempts to resolve
problems with their active duty pays and allowances. For example, the
unit administrator told us he contacted the servicing area active Army
finance office for the 101ST Airborne in West Virginia because his unit
was attached to the 101ST when they were deployed. The finance office
instructed him to contact the USPFO in West Virginia because, although
he was from a Colorado unit, his unit was assigned to a West Virginia
Army Guard unit. However, when he contacted the West Virginia USPFO for
service, officials from that office instructed him to contact the USPFO
in his home state of Colorado to provide service for his pay problems.
Systems Problems Hamper Prompt and Accurate Army Guard Pay:
Several systems issues were significant factors impeding accurate and
timely payroll payments to mobilized Army Guard soldiers, including:
* the lack of an integrated or effectively interfaced pay system with
both the personnel and order-writing systems,
* limitations in DJMS-RC processing capabilities, and:
* ineffective system edits of payments and debts.
DOD has a significant system enhancement project under way to improve
military pay. However, given that the effort has been under way for
about 5 years and DOD has encountered challenges fielding the system,
it is likely that the department will continue to operate with existing
system constraints for at least several more years.
Our findings related to weaknesses in the systems environment were
consistent with issues raised by DOD in its June 2002 report[Footnote
14] to the Congress on its efforts to implement an integrated military
pay and personnel system. Specifically, DOD's report acknowledged that
major deficiencies in the delivery of military personnel and pay
services to ensure soldiers receive timely and accurate personnel and
pay support must be addressed by the envisioned system. Further, the
report indicated these deficiencies were the direct result of the
inability of a myriad of current systems with multiple, complex
interfaces to fully support current business process requirements.
Figure 6 provides an overview of the five systems currently involved in
processing Army Guard pay and personnel information.
Figure 6: Overview of Army Guard Pay and Personnel Systems:
[See PDF for image]
[End of figure]
Lack of Integrated Systems:
The five key DOD systems involved in authorizing, entering, processing,
and paying mobilized Army Guard soldiers were not integrated. Lacking
either an integrated or effectively interfaced set of personnel and pay
systems, DOD must rely on error-prone, manual entry of data from the
same source documents into multiple systems. With an effectively
integrated system, changes to personnel records automatically update
related payroll records from a single source of data input. While not
as efficient as an integrated system, an automatic personnel-to-payroll
system interface can also reduce errors caused by independent, manual
entry of data from the same source documents into both pay and
personnel systems. Without an effective interface between the personnel
and pay systems, we found instances in which pay-affecting information
did not get entered into both the personnel and pay systems, thus
causing various pay problems--particularly late payments.
We found that an existing interface could be used to help alert
military pay personnel to take action when mobilization transactions
are entered into the personnel system. Specifically, Army Guard state
personnel offices used an existing interface between SIDPERS and JUSTIS
to transmit data on certain personnel transactions (i.e., transfers,
promotions, demotions, and address changes) to the 54 USPFOs to update
the soldier's pay records. However, this personnel-to-pay interface (1)
requires manual review and acceptance by USPFO pay personnel of the
transactions created in SIDPERS and (2) does not create pay and
allowance transactions to update a soldier's pay records. For example,
when Army Guard soldiers change from inactive drilling status to active
duty status, state personnel offices create personnel-related
transactions in SIDPERS, but associated pay-related transactions to
update the soldier's pay records are not automatically created in
JUSTIS. USPFO pay personnel are not aware that a pay-related
transaction is needed until they receive documentation from the
soldier, the soldier's unit commander, or the monthly personnel/pay
mismatch report. Automated improvements, such as an administrative
action transmitted through the personnel-to-payroll interface, could be
used to proactively alert USPFOs of certain pay-impacting transactions
that are created in SIDPERS as a means to help ensure timely and
accurate pay.
In our case studies, we found instances in which mobilization order
data that were entered into SIDPERS were either not entered into DJMS-
RC for several months after the personnel action or were entered
inconsistently. At the case study locations we audited, we found
several instances in which Army Guard soldiers received amended or
revoked orders that were entered into SIDPERS but were not entered into
DJMS-RC. We also found instances in which personnel pay-affecting
changes such as changes in family separation allowance, basic allowance
for housing, and active duty pay increases from promotions, were not
entered into the pay system promptly. Consequently, these soldiers
either received active duty pays they were not entitled to receive--
some for several months--or did not timely receive active duty pays to
which they were entitled.
:
[See PDF for image]
[End of figure]
The lack of an integrated set of systems was also apparent in the
relationship between JUSTIS and the order writing system--AFCOS.
Currently, certain personnel and order information entered and stored
in the AFCOS database is automatically filled in the JUSTIS input
screens pertaining to active duty tours for state missions upon entry
of the soldier's Social Security Number and order number. This auto-
fill functionality eliminates the need for some error-prone, manual
reentry of data into JUSTIS. However, currently, manual entry of data
from a hard copy of the soldier's orders and other documentation is
required to initiate the soldier's pay and allowances--a procedure that
defeats the purpose of an effective interface. For example, at one of
the case study units we audited, USPFO pay personnel had to manually
enter the soldier's active duty tour start and stop dates into JUSTIS
from a hard copy of the actual mobilization order.
When we brought this to the attention of NGB officials, they stated
that providing the auto-fill functionality to the mobilization input
screens would require minimal programming changes. NGB officials stated
that they planned to release a programming software change to all 54
USPFOs that would allow the start and stop dates to be automatically
filled into the mobilization screens to reduce the need for reentry of
some mobilization information. Because this software change was
scheduled to occur after the conclusion of our fieldwork, we did not
verify its effectiveness. In any case, while this proposed programming
change may be beneficial, it does not eliminate the need for manual
entry and review of certain other mobilization data needed to initiate
a soldier's basic pay and allowances.
Pay System Has Limited Active Duty Pay Processing Capabilities:
DOD has acknowledged that DJMS-RC is an aging, COBOL/mainframe-based
system. Consequently, it is not surprising that we found DFAS
established a number of "workarounds"--procedures to compensate for
existing DJMS-RC processing limitations with respect to processing
active duty pays and allowances to mobilized Army guard soldiers. Such
manual workarounds are inefficient and create additional labor-
intensive, error-prone transaction processing. We observed a number of
such system workaround procedures at the case study units we audited.
For example, for the special forces units we audited, our analysis
disclosed a workaround used to exclude soldiers' pay from federal taxes
while in combat. Specifically, DJMS-RC was not designed to make active
duty pays and exclude federal taxes applicable to those pays in a
single pay transaction. To compensate for this system constraint, DFAS
established a workaround that requires two payment transactions over a
2-month payroll cycle to properly exempt soldiers' pay for the combat
zone tax exclusion. That is, for those soldiers entitled to this
exclusion, DJMS-RC withholds federal taxes the first month, identifies
the taxes to be refunded during end-of-month pay processing, and then
makes a separate payment during the first pay update the following
month to refund the taxes that should not have been withheld. Soldiers'
taxes could not be refunded the same month because the DJMS-RC refund
process occurs only one time a month.
In addition, because of limited DJMS-RC processing capabilities, the
Army Guard USPFO and in-theatre active Army area servicing finance
office pay technicians are required to manually enter transactions for
nonautomated pay and allowances every month. DJMS-RC was originally
designed to process payroll payments to Army Reserve and Army Guard
personnel on weekend drills or on short periods of annual active duty
(periods of less than 30 days in duration) or for training. With Army
Guard personnel now being paid from DJMS-RC for extended periods of
active duty (as long as 2 years at a time), DFAS officials told us that
the system is now stretched because it is being used to make payments
and allowances that it was not structured or designed to make, such as
hostile fire pay and the combat zone tax exclusion. Many of these
active duty pay and allowances require manual, monthly verification and
reentry into DJMS-RC because, while some pays, such as basic active
duty pay and jump pay, can be generated automatically, DJMS-RC is not
programmed to generate automatic payment of certain other types of pay
and allowances.
For example, each month USPFO pay personnel are responsible for
entering into JUSTIS special duty assignment pay, foreign language
proficiency pay, and high altitude low opening (HALO) pay, and Army
area servicing finance offices are responsible for entering into DMO
hardship duty pay, for deployed soldiers entitled to these types of
pays and for which a performance certification is received from the
respective unit commanders. However, because pay transactions must be
manually entered every month soldiers are entitled to receive these
pays, it is often difficult to ensure that mobilized soldiers receive
their entitled nonautomated pays and allowances. For example, we found
a number of instances in which soldiers were underpaid their entitled
jump, foreign language proficiency, special duty assignment, or
hardship duty pays because pay technicians inadvertently omitted the
monthly manual input required to initiate these types of pays every
month.
At one of the case study units, we found USPFO pay personnel had a
procedure in place to help prevent inadvertently omitting month-to-
month entry of nonautomated pays for entitled soldiers. Specifically,
pay personnel at the USPFO in Maryland used a warning screen within
JUSTIS as a mechanism to alert them that soldiers were eligible to
receive that particular pay component that month. Although this does
not alleviate the problem of month-to-month manual entry, the warning
screen could be used to help preclude some of the pay problems we found
resulting from failures to enter transactions for nonautomated, month-
to-month pay and allowance entitlements.
Further, these month-to-month pays and allowances were not separately
itemized on the soldiers' leave and earnings statements in a user-
friendly format.
In contrast, at four of our six case study units, we found that a
significant number of soldiers were overpaid their entitled automated
pays when they were demobilized from active duty before the stop date
specified in their original mobilization orders. This occurred because
pay technicians did not update the stop date in DJMS-RC, which is
necessary to terminate the automated active duty pays when soldiers
leave active duty early. For example, the military finance office in
Kuwait, which was responsible for paying Virginia 20TH Special Forces
soldiers in the fall of 2002, did not stop hostile fire and hardship
duty pays as required when these soldiers left Afghanistan in October
2002. We found that 55 of 64 soldiers eligible for hostile fire pay
were overpaid for at least 1 month beyond their departure from
Afghanistan.
[See PDF for image]
[End of figure]
Soldiers' pays may appear as lump sum payments under "other credits" on
their leave and earnings statements. In many cases these other credit
pay and allowances appeared on their leave and earning statements
without adequate explanation. As a result, we found indications that
Army Guard soldiers had difficulty using the leave and earnings
statements to determine if they received all entitled active duty pays
and allowances. In addition, several Army Guard soldiers told us that
they had difficulty discerning from their leave and earnings statements
whether lump sum catch-up payments fully compensated them for
previously underpaid active duty pay and allowance entitlements.
Without such basic customer service, the soldiers cannot readily verify
that they received all the active duty pays and allowances to which
they were entitled.
As shown in the example leave and earnings statement extract included
in figure 7, an Army Guard soldier who received a series of corrections
to special duty assignment pay along with a current special duty
assignment payment of $110 is likely to have difficulty discerning
whether he or she received all and only entitled active duty pays and
allowances.
Figure 7: Sample Army Guard Leave and Earnings Statement:
[See PDF for image]
[End of figure]
System Edits Do Not Prevent Large Payments or Debts:
While DJMS-RC has several effective edits to prevent certain
overpayments, it lacks effective edits to reject large proposed net
pays over $4,000 at midmonth and over $7,000 at end-of-month before
their final processing. DOD established these thresholds to monitor and
detect abnormally large payments. As a result of the weaknesses we
identified, we found several instances in our case studies in which
soldiers received large lump sum payments, probably related to previous
underpayments or other pay errors, with no explanation. Further, the
lack of preventive controls over large payments poses an increased risk
of fraudulent payments. DJMS-RC does have edits that prevent soldiers
from (1) being paid for pay and allowances beyond the stop date for the
active duty tour, (2) being paid for more than one tour with
overlapping dates, or (3) being paid twice during a pay period.
Each month, DFAS Indianapolis pay personnel receive an Electronic Fund
Transfer Excess Dollar Listing after the electronic fund transfer
payment has been processed in DJMS-RC and deposited to the soldier's
bank account. DJMS-RC does not contain edit checks to reject payments
over the threshold amounts or to require review and approval of
payments over these amounts prior to their final processing. For
example, at one of the case study units we audited, DJMS-RC did not
have edit checks to prevent one soldier from receiving an erroneous
electronic payment totaling $20,110 without prior approval (see the
individual case illustration below for details). In addition, our
analysis showed 76 other payroll-related payments during the period
October 1, 2001, through March 31, 2003, of over $7,000 (net) each that
were paid by DJMS-RC. Because the Electronic Fund Transfer Excess
Dollar Listing is printed after the payment is made, timely detection
of errors is critical to help ensure that erroneous payments are
recovered and that fraud does not occur.
Similarly, DJMS-RC does not have system edits to prevent large debts
from being assessed without review and approval prior to being
processed and does not provide adequate explanations for pay-related
debt assessments. Our case studies identified individuals who received
debt notices in excess of $30,000 with no explanation. At five of the 6
units audited, we identified 86 individuals who had total pay and
allowance debts of approximately $300,000 as of March 31, 2003.
[See PDF for image]
[End of figure]
In addition, we found that current procedures used to notify soldiers
of large payroll-related debts did not facilitate customer service.
Under current procedures, if a soldier is determined to owe the
government money while on active duty, he is assessed a debt and
informed of this assessment with a notation of an "Unpaid Debt Balance"
in the remarks section of his Leave and Earnings Statement. A soldier
at one of our case study units told us that he was not notified in
advance of his receipt of his Leave and Earnings Statement that he had
a debt assessment and that two-thirds of his pay would be garnished. As
a result, he was not able to plan his financial affairs to avoid late
payments on his car and other loans.
This debt assessment notification procedure is even more egregious when
debts, particularly large debts, are assessed in error and up to two-
thirds of the soldier's pay may be garnished to begin repaying the
erroneous debt. For example, at our case study units, we found that the
only notice several soldiers received when they were erroneously
assessed payroll debts was an "Unpaid Debt Balance" buried in the
remarks section of their Leave and Earnings Statements. One such
assessment showing a $39,489.28 debt is shown in figure 8.
Figure 8: Sample Leave and Earnings Statement with Large Debt Balance:
[See PDF for image]
[End of figure]
Status of System Redesign Efforts:
DOD has a major system enhancement effort under way in this area
described as the largest personnel and pay system in the world in both
scope and number of people served--the Defense Integrated Military
Human Resources System (DIMHRS). One of the major benefits expected
with DIMHRS is "service members receiving accurate and timely pay and
benefits." Begun in 1998, DIMHRS is ultimately intended to replace more
than 80 legacy systems (including DJMS-RC) and integrate all pay,
personnel, training, and manpower functions across the department by
2007.
By the end of fiscal year 2003, DOD reporting shows that it will have
invested over 5 years and about $360 million in conceptualizing and
planning the system. In 2002, DOD estimated that integrated personnel
and pay functions of DIMHRS would be fully deployed by fiscal year
2007. It also reported a development cost of about $427 million.
However, our review of the fiscal year 2004 DOD Information Technology
budget request shows that DOD is requesting $122 million and $95
million, respectively, for fiscal years 2004 and 2005. In addition, the
department reported that the original DIMHRS project completion
milestone date has slipped about 15 months.
Part of the requested funding for fiscal year 2004 was to acquire a
payroll module, Forward Compatible Payroll. According to program
officials, this module, in conjunction with a translation module and a
Web services component, is to replace DJMS-RC and DJMS-AC systems by
March 2006, with the first deployment to the Army Reserve and Army
Guard in March 2005.
In assessing the risks associated with DIMHRS implementation as part of
its fiscal year 2004 budget package, DOD highlighted 20 such risks. For
example, DOD reported a 60 percent risk associated with "Service issues
with business process reengineering and data migration." The
department's ability to effectively mitigate such risks is of
particular concern given its poor track record in successfully
designing and implementing major systems in the past.[Footnote 15]
Consequently, given the schedule slippages that have already occurred
combined with the many risks associated with DIMHRS implementation,
Army Guard soldiers will likely be required to rely on existing pay
systems for at least several more years.
Army Guard Active Duty Pay Problems Continue with Current Deployments
to Iraq:
Our limited review of the pay experiences of the soldiers in the
Colorado Army Guard's 220TH Military Police Company, which was
mobilized to active duty in January 2003, sent to Kuwait in February
2003, and deployed to Iraq on military convoy security and highway
patrol duties in April 2003, indicated that some of the same types of
pay problems that we found in our six case study units continued to
occur. Of the 152 soldiers mobilized in this unit, we identified 54
soldiers who our review of available records indicated were either
overpaid, underpaid, or received entitled active duty pays and
allowances over 30 days late, or for whom erroneous pay-related debts
were created. We found that these pay problems could be attributed to
control breakdowns similar to those we found at our case study units,
including pay system input errors associated with amended orders,
delays and errors in coding pay and allowance transactions, and slow
customer service response. For example, available documentation and
interviews indicate that while several soldiers submitted required
supporting documentation to start certain pays and allowances at the
time of their initial mobilization in January 2003, over 20 soldiers
were still not receiving these pays in August 2003. Colorado USPFO
military pay-processing personnel told us they are reviewing pay
records for all deployed soldiers from this unit to ensure that they
are receiving all entitled active duty pays and allowances.
Conclusions:
The extensive problems we identified at the case study units vividly
demonstrate that the controls currently relied on to pay mobilized Army
Guard personnel are not working and cannot provide reasonable assurance
that such pays are accurate or timely. The personal toll that these pay
problems have had on mobilized soldiers and their families cannot be
readily measured, but clearly may have a profound effect on
reenlistment and retention. It is not surprising that cumbersome and
complex processes and ineffective human capital strategies, combined
with the use of an outdated system that was not designed to handle the
intricacies of active duty pay and allowances, would result in
significant pay problems. While it is likely that DOD will be required
to rely on existing systems for a number of years, a complete and
lasting solution to the pay problems we identified will only be
achieved through a complete reengineering, not only of the automated
systems, but also of the supporting processes and human capital
practices in this area. However, immediate actions can be taken in
these areas to improve the timeliness and accuracy of pay and allowance
payments to activated Army Guard soldiers. The need for such actions is
increasingly imperative in light of the current extended deployment of
Army Guard soldiers in their crucial role in Operation Iraqi Freedom
and anticipated additional mobilizations in support of this operation
and the global war on terrorism. Immediate steps to at least mitigate
the most serious of the problems we identified are needed to help
ensure that the Army Guard can continue to successfully fulfill its
vital role in our national defense.
Recommendations for Executive Action:
We recommend that the Secretary of Defense direct the Secretary of the
Army, in conjunction with the Under Secretary of Defense (Comptroller),
to take the following actions to address the issues we found with
respect to the existing processes, human capital, and automated systems
relied on to pay activated Army Guard personnel.
Process:
* Establish a unified set of policies and procedures for all Army
Guard, Army, and DFAS personnel to follow for ensuring active duty pays
for Army Guard personnel mobilized to active duty.
* Establish performance measures for obtaining supporting documentation
and processing pay transactions (for example, no more than 5 days would
seem reasonable).
* Establish who is accountable for stopping active duty pays for
soldiers who return home earlier than their units.
* Clarify the policies and procedures for how to properly amend active
duty orders, including medical extensions.
* Require Army Guard commands and unit commanders to carry out complete
monthly pay and personnel records reconciliations and take necessary
actions to correct any pay and personnel record mismatches found each
month.
* Update policies and procedures to reflect current legal and DOD
administrative requirements with respect to active duty pays and
allowances and transaction processing requirements for mobilized Army
Guard soldiers.
Human Capital:
* Consider expanding the scope of the existing memorandum of
understanding between DFAS and the Army concerning the provision of
resources to support surge processing at mobilization and
demobilization sites to include providing additional resources to
support surge processing for pay start and stop transaction
requirements at Army Guard home stations during initial soldier
readiness programs.
* Determine whether issues concerning resource allocations for the
military pay operations identified at our case study units exist at all
54 USPFOs, and if so, take appropriate actions to address these issues.
* Determine whether issues concerning relatively low-graded military
pay technicians identified at our case study units exist at all 54
USPFOs, and if so, take appropriate actions to address these issues.
* Modify existing training policies and procedures to require all USPFO
and active Army pay and finance personnel responsible for entering pay
transactions for mobilized Army Guard soldiers to receive appropriate
training upon assuming such duties.
* Require unit commanders to receive training on the importance of
adhering to requirements to conduct annual pay support documentation
reviews and carry out monthly reconciliations.
* Establish an ongoing mechanism to monitor the quality and completion
of training for both pay and finance personnel and unit commanders.
* Identify and evaluate options for improving customer service provided
to mobilized Army Guard soldiers by providing improved procedures for
informing soldiers of their pay and allowance entitlements throughout
their active duty mobilizations.
* Identify and evaluate options for improving customer service provided
to mobilized Army Guard soldiers to ensure a single, well-advertised
source for soldiers and their families to access for customer service
for any pay problems.
* Review the pay problems we identified at our six case study units to
identify and resolve any outstanding pay issues for the affected
soldiers.
Systems:
Interim Improvements to Current Automated Pay System Structure:
* Evaluate the feasibility of using the personnel-to-pay interface as a
means to proactively alert pay personnel of actions needed to start
entitled active duty pays and allowances.
* Evaluate the feasibility of automating some or all of the current
manual monthly pays, including special duty assignment pay, foreign
language proficiency pay, hardship duty pay, and HALO pay.
* Evaluate the feasibility of eliminating the use of the "other
credits" for processing hardship duty (designated areas), HALO pay, and
special duty assignment pay, and instead establish a separate component
of pay for each type of pay.
* Evaluate the feasibility of using the JUSTIS warning screen to help
eliminate inadvertent omissions of required monthly manual pay inputs.
* Evaluate the feasibility of redesigning Leave and Earnings Statements
to provide soldiers with a clear explanation of all pay and allowances
received so that they can readily determine if they received all and
only entitled pays.
* Evaluate the feasibility of establishing an edit check and requiring
approval before processing any debt assessments above a specified
dollar amount.
* Evaluate the feasibility of establishing an edit check and requiring
approval before processing any payments above a specified dollar
amount.
Longer-Term System Improvements:
* As part of the effort currently under way to reform DOD's pay and
personnel systems--referred to as DIMHRS--incorporate a complete
understanding of the Army Guard pay problems as documented in this
report into the requirements development for this system.
* In developing DIMHRS, consider a complete reengineering of the
processes and controls and ensure that this reengineering effort deals
not only with the systems aspect of the problems we identified, but
also with the human capital and process aspects.
Agency Comments and our Evaluation:
In its written comments, DOD concurred with our recommendations and
identified actions to address the identified deficiencies.
Speciifically, DOD's response outlined some actions already taken,
others that are underway, and further planned actions with respect to
our recommendations. If effectively implemented, these actions should
substantially resolve the deficiencies pointed out in our report. DOD's
comments are reprinted in appendix VIII.
:
As agreed with your office, unless you publicly announce its contents
earlier, we plan no further distribution of this report until 30 days
from its date. At that time, we will send copies of the report to
interested congressional committees. We will also send copies of this
report to the Secretary of Defense, the Under Secretary of Defense
(Comptroller), the Secretary of the Army, the Director of the Defense
Finance and Accounting Service, the Director of the Army National
Guard, and the Chief of the National Guard Bureau. We will make copies
available to others upon request. In addition, the report will be
available at no charge on the GAO Web site at [Hyperlink, http://
www.gao.gov] http://www.gao.gov. If you or your staff have any
questions regarding this report, please contact me at (202) 512-9505 or
[Hyperlink, kutgz@gao.gov] kutzg@gao.gov or Geoffrey Frank, Assistant
Director, at (202) 512-9518 or [Hyperlink, frankg@gao.gov]
frankg@gao.gov.
Sincerely yours,
Gregory D. Kutz:
Director, Financial Management and Assurance:
Signed by Gregory D. Kutz:
[End of section]
Appendixes:
Appendix I: Colorado Army National Guard B Company, 5TH Battalion, 19TH
Special Forces:
On December 5, 2001, the Colorado Army National Guard's B Company, 5TH
Battalion, 19TH Special Forces, was mobilized to active duty on orders
for a 2-year period--through December 4, 2003. The unit was mobilized
at Fort Knox and subsequently deployed in Afghanistan, Uzbekistan, and
surrounding areas to search for Taliban and al Qaeda terrorists as part
of Operation Enduring Freedom. The unit returned to Fort Campbell for
demobilization and was released from active duty on December 4, 2002--
1 year before the end of the unit's original mobilization orders. A
timeline of the unit's actions associated to its mobilization under
Operation Enduring Freedom is shown in figure 9.
Figure 9: Timeline Showing Key Actions Associated with Colorado
National Guard Special Forces Unit's Mobilization:
[See PDF for image]
[End of figure]
As summarized in table 3, the majority of soldiers from Colorado's B
Company experienced some sort of pay problem during one or more of the
three phases of their active duty mobilization. Overall, all 62
soldiers with the company had at least one pay problem associated with
their mobilization. These pay problems included not receiving entitled
pays and allowances at all; not receiving some entitled pays and
allowances within 30 days; and for some, overpayments of pays and
allowances. Specifically, we found (1) 56 soldiers did not receive
certain pay and allowance entitlements at all, or within 30 days of
their initial mobilization, (2) 61 soldiers either did not receive, or
did not receive within 30 days, the hostile fire pay or other "high-
risk location" pays they were entitled to receive based on their
deployment in Uzbekistan and Afghanistan, and (3) 53 soldiers either
improperly continued to receive hostile fire pay after leaving high-
risk locations overseas or continued to receive paychecks, as if they
were still on active duty status, for over 2 months beyond their
release from active duty.
Table 3: Summary of Identified Pay Problems by Phase:
Phase: Mobilization; Number of soldiers with pay problems: 56 of 62.
Phase: Deployed; Number of soldiers with pay problems: 61 of 62.
Phase: Demobilization; Number of soldiers with pay problems: 53 of 62.
Source: GAO analysis.
[End of table]
In total, we identified estimated overpayments of $494,000,
underpayments of $28,000, and late payments of $64,000, associated with
the pay problems we found. Of the estimated $494,000 in overpayments,
we identified about $88,000 that was subsequently collected from the
soldiers of Colorado's B Company. In addition, in trying to correct
overpayments associated with Colorado B Company's departure from high-
risk locations and release from active duty, the Defense Finance and
Accounting Service (DFAS) billed 34 of the unit's soldiers an average
of $48,000 each, for a largely erroneous total debt of over $1.6
million.
Many soldiers with the company characterized the service they received
from the state United States Property and Fiscal Office (USPFO) and the
active Army finance offices while deployed in Afghanistan and
surrounding areas as "poor" or "openly hostile." Some of the soldiers
in the unit expressed significant dissatisfaction with the time and
effort they, or their spouses were required to spend attempting to
identify and correct their pay.
These pay problems had a variety of adverse effects. The labor-
intensive efforts by the special forces soldiers to address pay
problems, in some cases, distracted them from important mission
operations. In addition, several soldiers told us that the numerous pay
problems they encountered would play a major role in their decision
whether to reenlist. According to several soldiers from Colorado's B
Company, the combined effect of (1) recurring pay problems, (2) having
two-thirds of their monthly training paychecks garnished to pay off
often erroneous payroll-related debts, and (3) receiving poor payroll
customer service during their active duty tours adversely affects
morale and may have an adverse effect on a soldier's willingness to
continue his or her service with the Army Guard. For example, a unit
official advised us that as of September 30, 2003, three soldiers had
left B Company primarily due to frustration over pay problems. The unit
official indicated that he expected additional soldiers would depart as
a result of the current debt problems.
Mobilization Pay Problems:
As summarized in table 4, we identified a number of pay problems
associated with eight different types of active duty pays and
allowances related to the unit's mobilization to active duty. These
problems resulted from failure to enter data, data entry errors, or
late entry of data needed by Army Guard USPFO military pay personnel
and by active Army military pay personnel at the unit's mobilization
station to start active duty pays. We also found that these pay
problems were exacerbated by breakdowns in customer service.
Table 4: Identified Mobilization Pay Problems:
Type of pay or allowance: Basic pay; Number of soldiers who did not
receive pay or allowance within 30 days of entitlement: 5; Number of
soldiers who were underpaid: 2; Number of soldiers who were overpaid:
0.
Type of pay or allowance: Basic allowance for housing; Number of
soldiers who did not receive pay or allowance within 30 days of
entitlement: 5; Number of soldiers who were underpaid: 3; Number of
soldiers who were overpaid: 0.
Type of pay or allowance: Basic allowance for subsistence; Number of
soldiers who did not receive pay or allowance within 30 days of
entitlement: 6; Number of soldiers who were underpaid: 4; Number of
soldiers who were overpaid: 0.
Type of pay or allowance: Family separation allowance; Number of
soldiers who did not receive pay or allowance within 30 days of
entitlement: 7; Number of soldiers who were underpaid: 7; Number of
soldiers who were overpaid: 1.
Type of pay or allowance: Jump pay; Number of soldiers who did not
receive pay or allowance within 30 days of entitlement: 11; Number of
soldiers who were underpaid: 2; Number of soldiers who were overpaid:
0.
Type of pay or allowance: HALO pay; Number of soldiers who did not
receive pay or allowance within 30 days of entitlement: 10; Number of
soldiers who were underpaid: 2; Number of soldiers who were overpaid:
8.
Type of pay or allowance: Foreign language proficiency pay; Number of
soldiers who did not receive pay or allowance within 30 days of
entitlement: 4; Number of soldiers who were underpaid: 0; Number of
soldiers who were overpaid: 0.
Type of pay or allowance: Special duty assignment pay; Number of
soldiers who did not receive pay or allowance within 30 days of
entitlement: 44; Number of soldiers who were underpaid: 41; Number of
soldiers who were overpaid: 2.
Source: GAO analysis.
[End of table]
In total, 56 out of 62 soldiers did not receive certain pays and
allowances at all, or in a timely manner, after being activated on
December 5, 2001. As illustrated in table 4, 11 soldiers did not
receive entitled Jump pay within 30 days of entitlement,[Footnote 16]
10 did not receive HALO pay within 30 days of entitlement,[Footnote 17]
and 41 soldiers did not receive at least 1 month of their special duty
assignment pay.[Footnote 18]
According to DFAS procedures, the unit's Army Guard USPFO should have
initiated these pays. In addition, these problems could have been
minimized if they were identified and corrected by the Army
mobilization station finance office at Fort Knox during the soldier
readiness processing at that location. According to Army regulations,
the active Army mobilization station is required to conduct a soldier
readiness program to review every mobilizing soldier's pay account for
accuracy. In essence, under Department of Defense (DOD) guidance, the
active Army mobilization stations are to act as a "safety net" to catch
and correct any errors in soldiers' active duty pays and allowances
before they are deployed on their active duty missions.
The underpayments and late payments resulted in adverse financial
repercussions for a number of the unit's members and their families. We
were told that many of the unit members' spouses tried to contact the
soldiers while they were deployed to find out why they were not
receiving the anticipated funds. We were told that neither the spouses
nor the soldiers received clear guidance on whom to contact to address
their pay concerns. For example, some soldiers sought help from the
active Army's finance offices at Fort Knox and Fort Campbell. However,
upon contacting officials at those locations, soldiers were told that
the active Army could not help them because they were Army Guard
soldiers and should therefore contact their home state Army Guard
USPFO. According to DFAS officials, the active Army finance offices
have the capability to service Army Guard soldiers. Fort Knox and Fort
Campbell finance personnel were either unaware of their capability or
unwilling to take the actions needed to address the unit's active duty
pay concerns.
Colorado's B Company soldiers turned back to the USPFO for assistance.
Although the USPFO did process a number of transactions to start
entitled active duty pays and allowances for the unit's soldiers, such
pays were started more than 30 days after the date they were entitled
to receive such pays. In one case, a soldier's spouse had to obtain a
$500 grant from the Colorado National Guard in order to pay bills while
her husband was on active duty.
Deployment Pay Problems:
Colorado's B Company was deployed to Uzbekistan and Afghanistan in
February 2002. As summarized in table 5, we identified pay problems
associated with the hostile fire pay, combat zone tax exclusion, and
hardship duty pay that unit soldiers were entitled to receive based on
their deployment to Afghanistan and surrounding areas.
Table 5: Identified Deployment Pay Problems:
Type of pay or allowance: Hostile fire pay; Number of soldiers who did
not receive pays or allowances within 30 days of entitlement: 51;
Number of soldiers who were underpaid: 2; Number of soldiers who were
overpaid: 2.
Type of pay or allowance: Combat zone tax exclusion; Number of soldiers
who did not receive pays or allowances within 30 days of entitlement:
56; Number of soldiers who were underpaid: 7; Number of soldiers who
were overpaid: 0.
Type of pay or allowance: Hardship duty pay; Number of soldiers who did
not receive pays or allowances within 30 days of entitlement: 59;
Number of soldiers who were underpaid: 33; Number of soldiers who were
overpaid: 14.
Source: GAO analysis.
[End of table]
Specifically, after arriving in Afghanistan, some soldiers in
Colorado's B Company received these pays sporadically, were not paid at
all, were paid but for inexplicable dollar amounts, or were overpaid
their entitled active duty pays and allowances while deployed. For
example, 16 of the 62 soldiers in B Company received the wrong type of
hardship duty pay, formerly called Foreign Duty Pay, in addition to the
correct hardship duty location pay while they were deployed in
Afghanistan.
We found that these pay problems could be attributed, in part, to the
active Army servicing finance office's lack of knowledge about how to
process transactions through the Defense Joint Military Pay System-
Reserve Component system (DJMS-RC) to start location-based pays and
allowances for the unit's soldiers. For example, we were told that
because active Army in-theater finance personnel were unfamiliar with
the required procedures to follow in starting hardship duty pays, they
entered transactions that resulted in soldiers receiving two different
location-based types of hardship duty pay for the same duty. Further,
Army Guard soldiers told us the active Army finance office could not
effectively answer questions concerning their pay entitlements or
transaction processing documentation requirements. After not receiving
any pay support from the active Army servicing finance location, the
unit's soldiers told us they contacted their Army Guard USPFO in
Colorado for assistance. However, Colorado USPFO officials informed
them that they did not have the capability to start location-based pays
and allowances for Army Guard soldiers.
A frequent complaint we received from Colorado's B Company soldiers
concerned the circular nature of any attempts to get assistance on pay
issues while deployed overseas. B Company's soldiers told us they spent
significant amounts of time and effort trying to correct the pay
problems while deployed on critical mission operations in Afghanistan
and surrounding areas--time and focus away from the mission at hand.
For example, as discussed in greater detail in our West Virginia case
study summary, a soldier from that unit took several days away from his
unit to get location-based pay started for both the West Virginia and
Colorado special forces units. We were also told that some members of
the unit used their satellite radios to attempt to resolve their pay
problems while deployed in Afghanistan. In addition, several of the
unit's soldiers told us their ability to identify and correct pay
problems while deployed was impaired by limited access to telephones,
faxes, e-mail, and their current Leave and Earnings Statements.
Pay Problems Associated with Demobilization and Release from Active
Duty:
In the late summer to early fall of 2002, soldiers from Colorado's B
Company began returning from Afghanistan and surrounding areas to Fort
Campbell to begin their demobilization from active duty. However, the
active Army's finance office at Fort Campbell failed to properly stop
soldiers' pay as of their demobilization dates, which for most of the
unit's soldiers was December 4, 2002. As summarized in table 6, 39 of
the unit's 62 soldiers continued to receive active duty pay and
allowances, some until February 14, 2003--2 and a half months after the
date of their release from active duty.
Table 6: Identified Demobilization Pay Problems:
Type of pay or allowance continued in error: Basic pay; Number of
soldiers overpaid: 39.
Type of pay or allowance continued in error: Hostile fire pay; Number
of soldiers overpaid: 41.
Type of pay or allowance continued in error: Combat zone tax exclusion;
Number of soldiers overpaid: 39.
Type of pay or allowance continued in error: Hardship duty pay; Number
of soldiers overpaid: 1.
Source: GAO analysis.
[End of table]
We found that both the active Army servicing finance location for the
unit while it was in Afghanistan and at Fort Campbell upon its return
to the United States did not take action to stop active duty pays and
allowances. According to DFAS procedures, the finance office at the
servicing demobilization station is to conduct a finance out-
processing, which would include identifying and stopping any active
duty pays that soldiers were no longer entitled to receive. According
to DFAS-Indianapolis Reserve Component mobilization procedures, the
local servicing active Army finance office also has primary
responsibility for entering transactions to stop hardship duty pay,
hostile fire pay, and the combat zone tax exclusion when soldiers leave
an authorized hostile fire/combat zone. However, in this case, that
office did not take action to stop these types of pay and allowances
for many of the unit's soldiers. For example, military pay personnel at
Fort Campbell failed to deactivate hostile fire pay for 41 out of 62 B
Company soldiers. With regard to customer service, some soldiers in the
unit told us that upon their return from overseas deployments, they
were informed that they should have corrected these problems while in-
theater, despite the fact that these problems were not detected until
the demobilization phase.
Colorado's B Company demobilization was complicated by the fact that
the unit did not demobilize through the same active Army location used
to mobilize the unit. DFAS procedures provide that Army Guard soldiers
are to demobilize and have their active duty pays stopped by the
installation from which they originally mobilized. However, the unit
received orders to demobilize at Fort Campbell rather than Fort Knox
where they originally mobilized. According to Fort Campbell personnel,
Colorado's B Company out-processed through the required sections,
including finance, during their demobilization. Nonetheless, the
finance office at that active Army location failed to stop all active
duty pays and allowances when the unit was demobilized from active
duty. Fort Campbell finance office personnel we interviewed were not
present during B Company's demobilization and had no knowledge of why
pay was not stopped during the demobilization process.
Failure to stop location-based and other active duty pays and
allowances for the unit's soldiers resulted in overpayments. As a
result of the Colorado USPFO's errors made in attempting to amend the
unit's orders to reflect an earlier release date than the date
reflected in the unit's original mobilization orders, large debts were
created for many soldiers in the unit. Specifically, largely erroneous
soldier debts were created when personnel at the Colorado USPFO
inadvertently revoked the soldiers' original mobilization orders when
attempting to amend the orders to reflect the unit's actual release
date of December 4, 2002--1 year before the end of the unit's original
orders. As a result, 34 soldiers received notice on their Leave and
Earnings Statements that rather than a debt for the 2 and a half months
of active duty pay and allowances they received after their entitlement
had ended, they owed debts for the 11 months of their active duty tour-
-an average of $48,000 per soldier, for a total debt of $1.6 million.
Several of the soldiers in the company noticed the erroneous debt and
called their unit commander. Some of the soldiers wanted to settle the
debt by writing a check to DFAS. However, they were told not to because
the exact amount of each soldier's debt could not be readily determined
and tracking such a payment against an as-yet undetermined amount of
debt could confuse matters. Meanwhile, some soldiers now returned from
active duty, resumed participation in monthly training, and began
having two-thirds of their drill pay withheld and applied to offset
their largely erroneous debt balances. We were told that it would take
approximately 4 to 5 years for the soldiers to pay off these debts
using this approach.
On April 17, 2003, and in a subsequent June 20, 2003, letter, we
brought this matter to the attention of DFAS and the DOD Comptroller,
respectively. Table 7 provides an overview of the actions leading to
the creation of largely erroneous payroll-related debts for many of the
unit's soldiers and DOD's actions to address these largely erroneous
debts.
Table 7: Timetable of Colorado B Company's Unresolved Pay-Related
Debts:
Date: December 5, 2001; Action: B Company begins active duty tour in
support of Operation Enduring Freedom.
Date: July to October 2002; Action: Soldiers demobilize through Fort
Campbell. Active duty pay and other location-based pays are not stopped
by finance office.
Date: December 4, 2002; Action: Active duty tour officially ends (1
year before the end of the unit's original 2-year orders). Pay is
stopped for 28 of 62 soldiers; pay erroneously continues for 34
others.
Date: February 14, 2003; Action: Thirty-four soldiers' pay was not
stopped until more than 70 days after tour officially ended. In
attempting to amend orders to stop active duty pay and allowances and
correct the length of the unit's original 2-year orders, the state
USPFO pay chief revokes the original orders. This action triggers a
systemic reversal of pay already earned from March 2002 through
February 15, 2003, and establishes debts for these soldiers from
$34,000 to $68,000. The soldiers were first notified of these large
debts by notations in the "Remarks" section of their Leave and Earnings
Statements.
Date: April 17, 2003; Action: GAO alerts DFAS Indianapolis of B
Company's continuing pay problem.
Date: June 20, 2003; Action: GAO sends the Under Secretary of Defense
(Comptroller) a letter requesting assistance on correcting pay issues
and making soldiers whole, including any tax consequences of errors.
DFAS-Indianapolis suspends 24 soldiers' pay-related debts from
collection activity.
Date: July 19, 2003; Action: DFAS-Indianapolis sends representative to
B Company monthly unit training to discuss debt computations. Debt
computations did not reflect underpayments due soldiers for location-
based pays.
Date: July 31, 2003; Action: DFAS Indianapolis agrees to again visit B
Company after completion of audit of soldiers' entire active duty tour
in order to make soldiers financially whole.
Source: GAO analysis.
[End of table]
Despite considerable time and effort of DFAS and others across the Army
Guard and Army, as of the end of our fieldwork in September 2003,
Colorado's B Company debt problems had not been resolved. In fact, for
one sergeant, his pay problems were further complicated by these
efforts. For example, in attempting to reduce the soldier's recorded
$30,454 debt by $20,111, DFAS instead sent the soldier a payment of
$20,111. As of September 2003, about 9 months after his demobilization,
the sergeant's reported unpaid debt balance was $26,806, but the actual
amount of his debt remained unresolved.
[End of section]
Appendix II: Virginia Army National Guard B Company, 3RD Battalion, 20TH
Special Forces:
On January 2, 2002, the Virginia Army National Guard's B Company, 3RD
Battalion, 20TH Special Forces, was called to active duty in support of
Operation Enduring Freedom for a 1-year tour. The unit in-processed at
Fort Pickett, Virginia, and departed for Fort Bragg, North Carolina.
The unit mobilized at Fort Bragg and for the next several months
performed various duties on base until May 2002. In early May 2002,
Virginia's B Company deployed to Afghanistan to perform search and
destroy missions against al Qaeda and Taliban terrorists. Although
several of B Company's soldiers returned from Afghanistan during August
and September 2002, most of the unit's members returned to Fort Bragg
for demobilization during October 2002 and were released from active
duty on January 2, 2003. A timeline of the unit's actions associated
with its mobilization under Operation Enduring Freedom is shown in
figure 10.
Figure 10: Timeline Showing Key Actions Associated with Virginia Army
National Guard Special Forces Unit's Mobilization:
[See PDF for image]
[End of figure]
As summarized in table 8, the majority of soldiers from Virginia's B
Company experienced some sort of pay problem during one or more of the
three phases of their active duty mobilization. Overall, 64 of the 65
soldiers with the company experienced at least one pay problem
associated with their mobilization. These pay problems included not
receiving entitled pays and allowances at all; not receiving some
entitled pays and allowances within 30 days; and for some, overpayments
of pays and allowances. Specifically, we found (1) 31 soldiers did not
receive certain pay and allowance entitlements at all, or within 30
days of their initial mobilization entitlement, or were overpaid, (2)
63 soldiers either did not receive, or did not receive within 30 days,
the hardship duty pay or other high-risk location pays they were
entitled to receive based on their deployment to Afghanistan, and (3)
60 soldiers improperly continued to receive hardship duty pay or
hostile fire pay after leaving high-risk locations overseas.
Table 8: Summary of Identified Pay Problems by Phase:
Process stage: Mobilization; Number of soldiers with pay problems: 31
of 65.
Process stage: Deployed; Number of soldiers with pay problems: 63 of
65.
Process stage: Demobilization; Number of soldiers with pay problems: 60
of 65.
Source: GAO analysis.
[End of table]
In total, we identified estimated overpayments of $25,000,
underpayments of $12,000, and late payments of $28,000 associated with
the pay problems we found. Of the estimated $25,000 in overpayments, we
identified about $2,000 that was subsequently collected from the
soldiers.
Our audit showed that the pay problems experienced by Virginia's B
Company were the result of a number of factors, including late
submission of required pay support documents, incorrect pay inputs by
Army personnel, and an active Army in-theater finance office's lack of
knowledge about the unit's presence in Afghanistan.
These pay problems had a number of adverse effects. Several B Company
soldiers we interviewed expressed dissatisfaction with the time and
effort they, or their spouses, were required to spend attempting to
identify and correct problems with their pay. Another complaint
concerned the circular nature of any attempts to get assistance. For
example, we were told the USPFO referred soldiers to the active Army
finance office and that office referred them back to the USPFO.
Virginia USPFO officials informed us that the circular nature of giving
assistance to soldiers was sometimes unavoidable. For example, they
said that once soldiers left their home unit and the Fort Bragg and in-
theater finance offices assumed pay responsibilities, the USPFO
informed soldiers and their spouses to contact these active Army
finance offices to discuss active duty payment problems. USPFO
officials acknowledged that in instances in which the active Army
finance office did not resolve soldiers' pay problems, USPFO staff
would try to fix the problems.
According to several soldiers, the combined effect of recurring pay
problems and receiving poor payroll customer service during their
active duty tours adversely affects morale and may have a negative
effect on the soldiers' willingness to continue serving with the Army
National Guard. Several soldiers told us that the numerous pay problems
they encountered would play a major role in their decisions whether to
reenlist.
Mobilization Pay Problems:
As summarized in table 9, we identified a number of pay problems
associated with the unit's mobilization to active duty. These problems
resulted from failures by unit soldiers to provide necessary
documentation to initiate certain pays, and data entry errors or late
entry of data needed to start active duty pays by Army Guard USPFO
military pay personnel and/or by active Army military pay personnel at
the unit's mobilization station.
Table 9: Identified Mobilization Pay Problems:
Type of pay: Jump pay; Number of soldiers who did not receive pay
within 30 days of entitlement: 3; Number of soldiers who were
underpaid: 8; Number of soldiers who were overpaid: 0.
Type of pay: Foreign language proficiency pay; Number of soldiers who
did not receive pay within 30 days of entitlement: ; 0; Number of
soldiers who were underpaid: ; 10; Number of soldiers who were
overpaid: ; 0.
Type of pay: HALO pay; Number of soldiers who did not receive pay
within 30 days of entitlement: 0; Number of soldiers who were
underpaid: 0; Number of soldiers who were overpaid: 10.
Type of pay: Basic pay; Number of soldiers who did not receive pay
within 30 days of entitlement: 13; Number of soldiers who were
underpaid: 0; Number of soldiers who were overpaid: 0.
Source: GAO analysis.
[End of table]
We identified 31 out of 65 soldiers from Virginia's B Company who did
not receive certain types of pay at all, were not paid in a timely
manner, or were overpaid after being activated on January 2, 2002. The
types of pay for which most problems occurred during mobilization were
parachute jump pay, foreign language proficiency pay, HALO pay, and
basic pay. As shown in table 9, we identified 8 soldiers who were
underpaid for jump pay, 10 soldiers who were underpaid for foreign
language pay, and 10 soldiers who were overpaid for HALO pay.
Prior to being mobilized, the soldiers in Virginia's B Company attended
a soldier readiness program at the USPFO at Fort Pickett, Virginia.
Part of this program was intended to ensure that soldiers had proper
administrative paperwork and financial documents necessary to start all
entitled active duty pays at mobilization. Virginia USPFO personnel who
conducted the finance portion of B Company's soldier readiness program
verified soldiers' supporting financial documentation and updated, if
necessary, each soldier's Master Military Pay Accounts (MMPA).
This verification process disclosed that many soldiers had unresolved
pay errors that had occurred as far back as 1996. According to U.S.
Army Forces Command Regulation 500-3-3, these problems should have been
corrected during required annual soldier readiness reviews conducted at
the unit's home station. As part of our analysis of the unit's pay, we
determined that some of these long-standing pay problems had been
resolved. For example, over $22,500 was processed for 52 B Company
soldiers' and included in soldiers' pay distributions from October 2001
to March 2003. USPFO officials told us that they have been working with
a sergeant from Virginia's B Company who performed a detailed analysis
of soldiers' long-standing pay problems in addition to pay problems
that occurred subsequent to January 2002 for the majority of their
mobilization.[Footnote 19] This sergeant performed these pay-related
tasks in addition to his mission-related duties as a professional
engineer.
After leaving the unit's home station, B Company traveled to Fort
Bragg, its active Army mobilization station. Fort Bragg personnel
conducted a second soldier readiness program that was intended to
identify and fix any pay issues not resolved at the home station.
According to USPFO officials and active Army finance office officials
at Fort Bragg, problems with jump pay and foreign language pay occurred
at mobilization because the necessary documentation to support jump pay
eligibility or language proficiency for a number of soldiers was not
always provided to the USPFO or the mobilization station. For example,
of the 8 soldiers in the unit who were underpaid for jump pay, 4 did
not receive jump pay until mid-February 2002 and 1 did not begin to
receive jump pay until mid-March. In another instance, we identified 10
soldiers who were eligible to receive foreign language proficiency pay
in January 2002, but did not receive payments for 1 or more months
after they became eligible.
Further, nine soldiers in the unit were eligible for HALO pay in
January 2002. However, again, in part because of the lack of proper
documentation from the unit's soldiers, but also because of pay input
errors at the active Army finance unit at Fort Bragg, pay problems
occurred for seven of the nine soldiers during January 2002, the
initial month of their mobilization. The seven soldiers eligible for
HALO pay received both jump pay as well as HALO pay during January
2002, which resulted in overpayments to these soldiers. These
overpayments occurred because Fort Bragg, unaware that the USPFO had
previously processed HALO pay for these soldiers, processed HALO pay a
second time, based on supporting documentation received from the unit.
Also, we found that two soldiers, who were not eligible to receive HALO
pay, received HALO pay for 3 months and another soldier received HALO
pay starting in January but did not become eligible for this pay until
mid-April 2002. Documentation was not available to explain these
errors.
Deployment Pay Problems:
In May 2002, Virginia's B Company left Fort Bragg and traveled to
Afghanistan to assist in missions against al Qaeda and Taliban forces.
While in Afghanistan, the soldiers encountered additional pay problems
related to hardship duty pay, special duty assignment pay, and, to a
lesser extent, hostile fire pay and basic pay. Also, the soldiers
experienced problems in receiving the full amounts of their entitled
HALO pay. Table 10 summarizes the pay problems we identified for the
unit while it was deployed.
Table 10: Identified Deployment Pay Problems:
Type of pay or allowance: Hardship duty pay; Number of soldiers who did
not receive pays or allowances within 30 days of entitlement: 63;
Number of soldiers who were underpaid: 0; Number of soldiers who were
overpaid: 0.
Type of pay or allowance: Special duty assignment pay; Number of
soldiers who did not receive pays or allowances within 30 days of
entitlement: 0; Number of soldiers who were underpaid: 10; Number of
soldiers who were overpaid: 24.
Type of pay or allowance: HALO pay; Number of soldiers who did not
receive pays or allowances within 30 days of entitlement: 0; Number of
soldiers who were underpaid: 11; Number of soldiers who were overpaid:
0.
Type of pay or allowance: Hostile Fire pay; Number of soldiers who did
not receive pays or allowances within 30 days of entitlement: 0; Number
of soldiers who were underpaid: 2; Number of soldiers who were
overpaid: 0.
Type of pay or allowance: Basic pay; Number of soldiers who did not
receive pays or allowances within 30 days of entitlement: 3; Number of
soldiers who were underpaid: 0; Number of soldiers who were overpaid:
0.
Source: GAO analysis.
[End of table]
Once the soldiers arrive in-theater, an active Army finance office
assigned to the unit is responsible for initiating assignment and
location-based pays for the unit's soldiers in DJMS-RC. However, we
found that the active Army in-theater finance offices did not always
know which units they were responsible for servicing or their location.
The in-theater finance office for Virginia's B Company, located in
Kuwait, did not start these pays as required. We were told that this
occurred because finance personnel in Kuwait did not know that B
Company had arrived in Afghanistan. Virginia's B Company soldiers, who
were not regularly receiving their leave and earnings statements while
in Afghanistan, told us they became concerned that they were not
receiving pays they were entitled to while deployed based on
conversations with their spouses.
After attempts to initiate location-based pays at the battalion finance
unit in Afghanistan were unsuccessful because finance personnel at that
location were not familiar with DJMS-RC's transaction processing
requirements for starting these types of pay, two soldiers were ordered
to travel to Camp Snoopy, Qatar, where another Army finance office was
located. Attempts to start assignment and location-based pays for the
unit's soldiers at Camp Snoopy were also unsuccessful. One of the
soldiers told us that they flew to Kuwait because they were advised
that the finance unit at that active Army finance office was more
knowledgeable about how to enter the necessary transactions into DJMS-
RC to pay the unit's soldiers. The soldier told us he took an annotated
battle roster listing the names of all Virginia's B Company soldiers
deployed in and around Afghanistan at that time and the dates they
arrived in country with him as support for starting the unit's in
theater-based pays.[Footnote 20] Finally, at Kuwait the appropriate in-
theater pays were activated and the two soldiers returned to
Afghanistan. As shown in figure 11, the entire trip required interim
stops at eight locations because of limited air transportation and took
about a week.
Figure 11: Itinerary of Two B Company Soldiers' Efforts to Start
Location-Based Pays for the Unit:
[See PDF for image]
[End of figure]
Despite this costly, time-consuming, and risky procedure to start
location-based pays for the unit, 63 of Virginia's B Company soldiers,
who became eligible for hardship duty pay in May 2002, not receive
their location-based pay entitlements until July 2002.
Problems with special duty assignment pay also occurred during the
unit's deployment. We found that both underpayments and overpayments of
this type of pay were made as a result of confusion about who was
responsible for making the manual monthly transactions necessary for
entitled soldiers in the unit to receive these pays. For example, 10
soldiers in B Company did not receive at least 1 month of entitled
special duty assignment pay. Conversely, overpayments of this type of
pay were made when B Company left Afghanistan and returned to Fort
Bragg to demobilize in October 2002, and both the active Army finance
office at Fort Bragg and the Virginia USPFO entered special duty
assignment pay transactions for the unit's eligible soldiers. Fort
Bragg processed October and November 2002 special duty assignment duty
payments for 24 of the unit's soldiers in December 2002. Virginia's
USPFO, unaware that Fort Bragg had made these payments in December
2002, also paid all 24 eligible soldiers special duty assignment pay
for October and November 2002 several months later. USPFO officials
explained that their military pay office processed the payments because
B Company submitted the necessary documentation certifying that the
unit's soldiers were entitled to receive back pay for missed special
assignment duty pays. The officials told us that special duty
assignment pay was processed because, having received this
certification from the unit, they assumed that payments had not yet
been made.
Virginia's B Company soldiers also experienced problems with HALO pay
during deployment. We identified 11 B Company soldiers eligible for
HALO pay who did not receive 1 or more months of this pay as of March
31, 2003. We determined that these problems occurred because such pays
require manual monthly input, and the pay technicians inadvertently did
not make the required entries each month. In addition, 2 of the unit's
soldiers did not receive all hostile fire payments to which they were
entitled. One soldier did not receive the first month of entitled
hostile fire pay for May 2002, and the other soldier received hostile
fire pay for May 2002 but not for the remaining months of his
deployment.
Pay Problems Associated with Demobilization and Release from Active
Duty:
Although some soldiers in B Company left Afghanistan during August and
September 2002, most of the unit returned to Fort Bragg in October 2002
to begin the demobilization process. As summarized in table 11, 57
soldiers continued to receive pays to which they were no longer
entitled because they left Afghanistan, including either hostile fire
pay, hardship duty pay, or both.
Table 11: Identified Demobilization Pay Problems:
Type of pay or allowance continued in error: Hostile fire pay; Number
of soldiers who were overpaid: 55; Number of soldiers having an
overpayment collected: 0.
Type of pay or allowance continued in error: Hardship duty pay; Number
of soldiers who were overpaid: 57; Number of soldiers having an
overpayment collected: 23.
Source: GAO analysis.
[End of table]
According to DOD mobilization procedures, the finance office at the
servicing demobilization station is to conduct a finance out-
processing. The finance office is responsible for inputting
transactions to stop certain location-based pays, such as hardship duty
pay and hostile fire pay. In addition, according to DOD's Financial
Management Regulation (FMR), Volume 7A, chapters 10 and 17, location-
based pays must be terminated when the soldier leaves the hostile fire/
combat zone.
Overpayments to B Company soldiers occurred during demobilization
because the in-theater finance office continued to make hostile fire
and hardship duty pays after soldiers left Afghanistan in October 2002,
and the Fort Bragg active Army finance office did not enter
transactions into DJMS-RC to stop these payments as required. We found
that 55 of 64 soldiers eligible for hostile fire pay were overpaid for
at least 1 month beyond their departure from Afghanistan. Also, we
found that 57 of 64 soldiers eligible for hardship duty pay were
overpaid at least part of 1 month. A Fort Bragg official explained that
the Army finance office personnel at Fort Bragg were not aware that
these payments were still being made after the soldiers had returned to
the United States, but, subsequently determined that hostile fire and
hardship duty overpayments were occurring and took action to terminate
the payments.
Also, four members of Virginia's B Company, who were injured while
deployed in Afghanistan, returned to Fort Bragg and requested medical
extensions to their active duty tours so they could continue to receive
active duty pay and medical benefits until they recovered. One of the
soldiers told us, "People did not know who was responsible for what. No
one knew who to contact or what paperwork was needed …." To support
themselves and their families, these four soldiers needed the active
duty military pay they were entitled to receive while obtaining medical
treatment and recovering from their injuries. However, after risking
their lives for their country, all four have had gaps in receiving
active duty pay while they remained under a physician's care after
their demobilization date and have experienced financial difficulties.
In addition, when active duty pay was stopped, the soldiers' medical
benefits were discontinued. As discussed earlier in this report, these
pay-related problems for wounded soldiers caused significant hardship
for them and their families.
[End of section]
Appendix III: C Company, 2ND Battalion, 19TH Special Forces Group, West
Virginia:
On December 5, 2001, West Virginia's 19TH Special Forces Group, 2ND
Battalion, C Company, was called to active duty in support of Operation
Enduring Freedom for a 1-year tour. The unit was mobilized at Fort Knox
and subsequently deployed in Afghanistan, Uzbekistan, and surrounding
areas to search for possible Taliban and al Qaeda terrorists. The unit
returned to Fort Campbell for demobilization and was released from
active duty on December 4, 2002. A timeline of the unit's actions
associated with its mobilization under Operation Enduring Freedom is
summarized in figure 12.
Figure 12: Timeline Showing Key Actions Associated with West Virginia
National Guard Special Forces Unit's Mobilization:
[See PDF for image]
[End of figure]
As summarized in table 12, the majority of soldiers from C Company
experienced some sort of pay problem during one or more of the three
phases of their active duty mobilization. Overall, 86 of the 94
soldiers with the company experienced at least one pay problem
associated with its mobilization. Specifically, we identified (1) 36
soldiers who were either overpaid, did not receive certain pay and
allowance entitlements at all, or did not receive pay within 30 days of
their initial mobilization entitlement, (2) 84 soldiers who were either
overpaid, did not receive, or did not receive within 30 days, the
hostile fire pay or other high-risk location pays they were entitled to
receive based on their deployment in Uzbekistan and Afghanistan, and
(3) 66 soldiers who did not receive, or did not receive within 30 days,
their special duty assignment pay during their demobilization.
Table 12: Summary of Identified Pay Problems by Phase:
Process stage: Mobilization; Number of soldiers with pay problems: 36
of 94.
Process stage: Deployed; Number of soldiers with pay problems: 84 of
94.
Process stage: Demobilization; Number of soldiers with pay problems: 66
of 94.
Source: GAO analysis.
[End of table]
In total, we identified estimated overpayments of $31,000,
underpayments of $9,000, and late payments of $61,000 associated with
the identified pay problems. We did not identify any collections
related to overpayments for this unit.
Mobilization Pay Problems:
As summarized in table 13, several soldiers from C Company did not
receive the correct pay or allowance when called to active duty. We
found that some soldiers received payments over 5 months late and other
soldiers had been overpaid. Seven soldiers did not receive their $225
per month HALO pay until over a month after mobilization, and 18 other
soldiers received combat diver pay and HALO pay to which they were not
entitled.
Table 13: Identified Mobilization Pay Problems:
Type of pay or allowance: HALO pay; Number of soldiers who did not
receive pay or allowance within 30 days of entitlement: 7; Number of
soldiers who were underpaid: 0; Number of soldiers who were overpaid:
10.
Type of pay or allowance: Combat diver pay; Number of soldiers who did
not receive pay or allowance within 30 days of entitlement: 0; Number
of soldiers who were underpaid: 0; Number of soldiers who were
overpaid: 8.
Type of pay or allowance: Jump pay; Number of soldiers who did not
receive pay or allowance within 30 days of entitlement: 0; Number of
soldiers who were underpaid: 7; Number of soldiers who were overpaid:
0.
Type of pay or allowance: Special duty assignment pay; Number of
soldiers who did not receive pay or allowance within 30 days of
entitlement: 4; Number of soldiers who were underpaid: 0; Number of
soldiers who were overpaid: 0.
Type of pay or allowance: Foreign language proficiency pay; Number of
soldiers who did not receive pay or allowance within 30 days of
entitlement: 3; Number of soldiers who were underpaid: 3; Number of
soldiers who were overpaid: 0.
Type of pay or allowance: Family separation allowance; Number of
soldiers who did not receive pay or allowance within 30 days of
entitlement: 2; Number of soldiers who were underpaid: 0; Number of
soldiers who were overpaid: 0.
Type of pay or allowance: All entitled pays and allowances; Number of
soldiers who did not receive pay or allowance within 30 days of
entitlement: 0; Number of soldiers who were underpaid: 0; Number of
soldiers who were overpaid: 1.
Source: GAO analysis.
[End of table]
Prior to being mobilized, the soldiers in C Company attended a soldier
readiness program at their unit armory. This program was intended to
ensure that all soldiers had proper administrative paperwork and
financial documents and were physically fit for the ensuing
mobilization. West Virginia USPFO personnel who conducted the finance
portion of C Company's soldier readiness program were required to
verify soldiers' supporting financial documentation, and update, if
necessary, soldiers' pay records in DJMS-RC. Soldiers not submitting
the correct paperwork at the time of the Soldier Readiness Program
caused some payments to be late. For example, according to the USPFO,
one soldier did not submit the proper paperwork for his family
separation allowance. The delay in submission caused his first payment
to be over 3 months late.
Another problem with the unit's mobilization related to 17 soldiers who
had significant problems with their HALO pay. According to USPFO
personnel, the unit commander for C Company did not provide the USPFO a
list of the unit members who were eligible to receive HALO pay.
Therefore, the USPFO paid all the unit members who were parachute
qualified the regular parachute pay. Once the USPFO received a list of
the unit's 17 HALO-qualified soldiers, pay personnel attempted to
recoup the regular jump pay and pay the HALO team the increased HALO
pay amount. USPFO personnel told us they did not know how to initiate a
payment for the difference between regular jump and HALO pay.
Consequently, they entered transactions to recoup the entire amount of
jump pay and then initiated a separate transaction to pay the correct
amount of HALO pay.
According to the DOD FMR, volume 7A, chapter 24, soldiers who are
eligible to receive regular parachute pay and HALO pay are paid the
higher of the two amounts, but not both. In this case, the 17 members
of C Company's HALO team should have received a $225 per month payment
from the beginning of their mobilization. Pay records indicate that
this correction initiated by the USPFO occurred about 2 months after
the unit mobilized. When the USPFO personnel attempted to collect the
soldiers' regular parachute pay, they inadvertently collected a large
amount of the soldiers' basic active duty pay for the first month of
their mobilization. Personnel at the USPFO stated that the error caused
debts on soldiers' accounts but was corrected immediately after a pay
supervisor at the USPFO detected the error in February. Even after the
soldiers' pay was corrected, USPFO personnel did not stop the regular
parachute pay for the HALO team members, but instead let it continue,
then collected the $150 per month parachute pay manually, and then paid
the correct $225 per month HALO pay. This error-prone, labor-intensive
manual collection and subsequent payment method used by the USPFO
personnel to pay C Company's HALO team the higher HALO rate of pay was
not consistently applied each month and resulted in 7 soldiers being
overpaid when their regular parachute pay was not collected.
In addition to the 7 soldiers who were actually on the HALO team, 10
other soldiers were on the initial list given to the USPFO but were
actually not on the HALO team. The unit commander for C Company
provided a more accurate list to the USPFO some time after the first
list, and only members on the more accurate list continued to receive
HALO pay. However, USPFO pay personnel did not attempt to collect the
HALO pay from unit members on the first list who had incorrectly
received HALO pay. As a result of this complex collection and payment
process, the unit's soldiers were confused about whether they were
receiving all their entitled active duty pays while mobilized.
After leaving the unit's home station, C Company traveled to Fort Knox,
its active Army mobilization station. As required by Army guidance,
Fort Knox personnel conducted a second soldier readiness program to
identify and fix unresolved pay issues associated with the unit's
mobilization. Based on our findings that the pay problems continued
after this review, it does not appear that the active Army finance
office at Fort Knox carried out its responsibility to review and
validate all of C Company soldiers' active duty pays and allowance
support records. Problems with HALO and family separation pay were not
resolved for several months after the mobilization. As a result, the
soldiers' pay problems persisted into their deployment overseas.
Deployment Pay Problems:
As summarized in table 14, we identified a number of pay problems
associated with three different types of active duty pays related to
the unit's deployment.
Table 14: Identified Deployment Pay Problems:
Type of pay or allowance: Hostile fire pay; Number of soldiers who did
not receive pay or allowance within 30 days of entitlement: 45; Number
of soldiers who were underpaid: 18; Number of soldiers who were
overpaid: 40.
Type of pay or allowance: Hardship duty pay (designated areas); Number
of soldiers who did not receive pay or allowance within 30 days of
entitlement: 75; Number of soldiers who were underpaid: 5; Number of
soldiers who were overpaid: 12.
Type of pay or allowance: Hardship duty pay (certain places); Number of
soldiers who did not receive pay or allowance within 30 days of
entitlement: 0; Number of soldiers who were underpaid: 0; Number of
soldiers who were overpaid: 29.
Source: GAO analysis.
[End of table]
After going through initial in-processing at Fort Knox, C Company
soldiers traveled to Fort Campbell where they prepared to deploy
overseas. Starting in December 2001, members of C Company traveled to
Uzbekistan and Afghanistan to perform special forces missions. During
their deployment overseas, C Company soldiers consistently experienced
problems related to specific location-based payments such as hostile
fire pay and hardship duty pay. In 78 cases, the payments were not
started within 30 days from when the soldiers were entitled to the
payments. In 22 other cases, we determined that soldiers had not
received all location-based pays as of March 31, 2003. In 60 cases, the
soldiers were overpaid or payments were not stopped when they left the
combat zones. Due to the lack of supporting documents at the state,
unit, and battalion-levels, dates for when each soldier entered and
left combat zones were not always available. Consequently, there may
have been other deployment-related pay problems for C Company that we
were not able to identify.
According to DFAS policy, when soldiers from C Company arrived in
Uzbekistan the in-theater finance office in Uzbekistan was responsible
for initiating location-based payments for the unit. Unit personnel
stated that the staff in the finance office in Uzbekistan were not
adequately trained in how to input pays into DJMS-RC. Initially, we
were told the Uzbekistan finance office incorrectly believed it was the
West Virginia USPFO's responsibility to start location-based pays for
the deployed soldiers from C Company. The active Army finance office in
Uzbekistan instructed the unit to contact the West Virginia USPFO to
start location-based pays. However, DFAS policy clearly states that it
is the active Army in-theater finance office's responsibility to start
and maintain monthly location-based payments.
After attempts by the unit administrator and the Uzbekistan finance
office failed to initiate the payments, a sergeant in C Company was
ordered to travel to Camp Doha, Kuwait, to have the unit's location-
based pays started. The soldier stated that he traveled to Camp Doha
because he was told that the finance unit at that active Army finance
location was more knowledgeable in how to enter transactions into DJMS-
RC to initiate location-based pays for the unit's soldiers. The soldier
took with him all the necessary paperwork to have the pays started for
all the companies under the battalion, including C Company. On the
return flight from the sergeant's mission in Kuwait, his plane
encountered enemy fire and was forced to return to a safe airport until
the next day. The failure by active Army personnel at the finance
office in Uzbekistan to enter the transactions necessary to start
location-based pays for the unit delayed payments to some soldiers for
up to 9 months and put one soldier in harm's way.
Per DOD FMR, volume 7A, chapter 10, soldiers who perform duty in
hostile fire zones are entitled to hostile fire pay as soon as they
enter the zone. However, we found that 45 soldiers in C Company did not
have their hostile fire pay started until over 30 days after they were
entitled to receive it. Some of C Company's soldiers received
retroactive payments over 2 months after they should have received
their pay. In addition, as of March 31, 2003, we determined that 18
soldiers from the unit were not yet paid for 1 or more months that they
were in the hostile fire zone. We also identified 40 soldiers who
received hostile fire pay after they had left the country and were no
longer entitled to receive such pays. These overpayments occurred
primarily because hostile fire pay is an automatic recurring payment
based on the start and stop date for the soldier's mobilization entered
into DJMS-RC. However, in this case, the active Army finance office in
Uzbekistan did not amend the stop dates for automated active duty pays
in DJMS-RC to reflect that C Company left the designated area before
the stop date entered into DJMS-RC. The active Army finance office's
failure to follow prescribed procedures resulted in overpayment of this
pay to 40 soldiers.
Per DOD FMR, volume 7A, chapter 17, soldiers who perform duties in
designated areas for over 30 days are entitled to the hardship duty pay
incentive. The FMR provides for two mutually exclusive types of
hardship duty pay for identified locations--one according to specified
"designated areas" and the other for specified "certain places."
Effective December 31, 2001, the regulation no longer permitted
soldiers newly assigned to locations specified as "certain places" to
begin receiving hardship duty pay. However, the regulation specified
Afghanistan and Uzbekistan as designated areas and provided for paying
$100 a month to each soldier serving there.
While deployed to Afghanistan and Uzbekistan, 29 soldiers in C Company
were mistakenly provided both types of hardship duty pay. The local
finance office in Uzbekistan correctly entered transactions to start C
Company's hardship duty pay for designated areas into the DJMS-RC pay
system. Due to limitations in DJMS-RC, the local finance office was
required to manually enter the designated area payments for each
soldier every month the unit was in a designated area. However, DFAS
documentation shows that finance personnel at Fort Bragg incorrectly
initiated a recurring certain places hardship duty payment for soldiers
in C Company.[Footnote 21] For some soldiers, payments continued until
May 31, 2002 and for others the payments continued until the end of
their tour of active duty on December 4, 2002. These erroneous certain
places hardship duty pays resulted in overpayments.
In addition, because DJMS-RC processing capability limitations required
the designated areas payment to be manually entered every month the
unit was in the designated area, the in-theater finance office in
Uzbekistan failed to consistently enter the monthly designated area
payments for all entitled soldiers. Throughout the time C Company was
in Uzbekistan and Afghanistan, we identified a total of 5 soldiers who
missed one or more monthly payments of entitled hardship duty
designated area pay. Other soldiers received entitled payments over 9
months late. Still others were paid more than once for the same month
or paid after leaving the designated area, resulting in overpayments to
12 soldiers. The mix of erroneous certain places hardship duty payments
along with sporadic payments of the correct type of designated area
hardship duty pay caused confusion for the soldiers of C Company and
their families regarding what types of pay they were entitled to
receive and whether they received all active duty entitlements.
Demobilization and Release from Active Duty Pay Problems:
C Company returned to Fort Campbell during the fall of 2002 to begin
the demobilization process. By October 2002, all of the unit had
returned from overseas and was demobilized on December 4, 2002. As
shown in table 15, 66 of C Company's 94 soldiers experienced pay
problems associated with their demobilization from active duty.
Table 15: Identified Pay Demobilization Problems:
Type of Pay or Allowance: Special duty assignment pay; Number of
soldiers who did not receive pay or allowances within 30 days of
entitlement: 63; Number of soldiers who were underpaid: 3.
Source: GAO analysis.
[End of table]
In October 2002, eligible soldiers in the unit were entitled to a
special duty assignment pay increase from $110 per month to $220 per
month. To initiate this higher pay rate, the West Virginia Army
National Guard military personnel office was required to cut new
special duty assignment pay orders for all eligible C Company soldiers.
USPFO officials stated that they could not pay the increased amount
until they received a copy of the new orders. The USPFO personnel did
not continue to pay the $110 a month to the soldiers because they did
not want to have to recoup the old amount and then pay the correct
amount when orders were received. However, the orders for the soldiers
were not received by the USPFO for several months, which created a
delay in the payment of the soldiers' special duty assignment pay.
Supporting documents showed that a delay in the production of the
orders by the West Virginia Army National Guard military personnel
office caused the late payments. For C Company, 63 soldiers received
their last 3 months of special duty assignment pay over 30 days late.
Another 3 soldiers did not receive their last 3 months of special duty
assignment pay because the USPFO inadvertently overlooked the manual
transaction entries required to process special duty assignment pay for
those soldiers.
:
[End of section]
Appendix IV: Mississippi 114th Military Police Company:
On December 27, 2001, the Mississippi Army National Guard's 114th
Military Police Company was called to active duty in support of
Operation Noble Eagle for a 1-year tour--through January 5, 2003. The
unit mobilized in Clinton, Mississippi, and departed for Fort Campbell,
Kentucky, on January 6, 2002. The unit in-processed at Fort Campbell
and for the next 5 months performed military police duties at Fort
Campbell until early June. On June 10, 2002, the 114th Military Police
Company deployed to Guantanamo Bay, Cuba, to perform base security and
guard duties for Taliban and al Qaeda prisoners. After guarding
detainees in Cuba for approximately 6 months, the unit returned to Fort
Campbell in late November 2002. At Fort Campbell the unit out-processed
and returned to Clinton, Mississippi, and was released from active duty
on January 5, 2003. A time line of actions associated with the unit's
active duty mobilization is shown in figure 13.
Figure 13: Timeline Showing Key Actions Associated with the Mississippi
Army National Guard Military Police Unit's Mobilization:
[See PDF for image]
[End of figure]
As summarized in table 16, at every stage of the unit's 1-year tour of
active duty, soldiers experienced various pay problems. Of the 119
soldiers of the Mississippi Army National Guard's 114TH Military Police
Company, 105 experienced at least one pay problem associated with
mobilization in support of Operation Noble Eagle. Specifically, we
found that (1) 21 soldiers experienced underpayments, overpayments, or
late payments, or a combination of these, during their initial
mobilization, including some soldiers who did not receive payments for
up to 7 months after their mobilization dates, and others who still
have not received certain payments, (2) 93 soldiers experienced
underpayments, overpayments, late payments, or some combination, during
their tour of active duty at Fort Campbell and in Cuba, including in-
theater incentives such as hardship duty pay, and (3) 90 soldiers
experienced underpayments, overpayments, late payments, or a
combination of these, during their demobilization at Fort Campbell,
including problems related to the continuation of in-theater incentives
and overpayment of active duty pay after demobilization.
Table 16: Summary of Identified Pay Problems by Phase:
Phase: Mobilization; Number of soldiers with pay problems: 21 of 119.
Phase: Deployed; Number of soldiers with pay problems: 93 of 119.
Phase: Demobilization; Number of soldiers with pay problems: 90 of 119.
Source: GAO analysis.
[End of table]
In total, we identified estimated overpayments of $50,000,
underpayments of $6,000, and late payments of $15,000 associated with
the pay problems we found. Of the estimated $50,000 in overpayments, we
identified about $13,000 that was subsequently collected from the
unit's soldiers.
Mobilization Pay Problems:
As summarized in table 17, we found that 21 soldiers from the 114TH
Military Police Company experienced underpayments, overpayments, late
payments, or some combination related to pay and allowance entitlements
when called to active duty. For example, several soldiers did not
receive their entitled $100 per month family separation allowance until
7 months after mobilization, and several other soldiers did not receive
the correct type of basic allowance for housing as specified in the DOD
FMR, Volume 7A, chapter 26.
Table 17: Identified Mobilization Pay Problems:
Type of pay or allowance: Basic pay; Number of soldiers who did not
receive pay or allowances within 30 days of entitlement: 2; Number of
soldiers who were underpaid: 1; Number of soldiers who were overpaid:
5.
Type of pay or allowance: Family separation allowance; Number of
soldiers who did not receive pay or allowances within 30 days of
entitlement: 11; Number of soldiers who were underpaid: 1; Number of
soldiers who were overpaid: 0.
Type of pay or allowance: Basic allowance for housing; Number of
soldiers who did not receive pay or allowances within 30 days of
entitlement: 2; Number of soldiers who were underpaid: 3; Number of
soldiers who were overpaid: 0.
Type of pay or allowance: Jump pay; Number of soldiers who did not
receive pay or allowances within 30 days of entitlement: 0; Number of
soldiers who were underpaid: 0; Number of soldiers who were overpaid:
1.
Source: GAO analysis.
[End of table]
Prior to being mobilized, the soldiers in the 114TH Military Police
Company attended a soldier readiness program at their unit armory. The
purpose of this review was to ensure that all soldiers had proper
administrative paperwork and financial documents and were physically
fit for the ensuing mobilization. Mississippi USPFO personnel, who
conducted the finance portion of the 114TH Military Police unit's
soldier readiness program, were required to verify soldiers' supporting
financial documentation, and update, if necessary, soldiers' MMPAs. Not
submitting the complete and current paperwork at the time of the
soldier readiness program contributed to some of the late payments we
identified. For example, some soldiers did not receive their family
separation allowance because they did not provide documentation
supporting custody arrangements. However, we also found that confusion
at the USPFO over the eligibility of single parents contributed to
these late pays. It was later in the unit's active duty tour that
finance officers initiated action for 11 of the 114TH Military Police
unit's soldiers to receive retroactive payments, some for as much as 7-
months of back pay. In another case, a former Special Forces soldier
improperly received jump pay even though his assignment to this
military police unit did not require that special skill.
Five soldiers improperly received active duty pay and allowances even
though they did not mobilize with the unit. Because these five soldiers
were not deployable for a variety of reasons, they were transferred to
another unit that was not subject to the current mobilization. However,
the delay in entering the transfer and stopping pay caused each of
these soldiers to receive active duty pay for 10 days. Several other
soldiers received promotions at the time of their mobilization, but
state military pay personnel at the USPFO did not enter transactions
for the promotions until several months later, resulting in late
promotion pay to the affected soldiers. Delays by the unit in
submitting the promotion paperwork or by the state personnel office in
entering the promotion paperwork into the personnel system caused these
problems. However, supporting documents were not available to enable us
to determine the specific cause of the delays.
After leaving the unit's home station, the 114TH Military Police
Company traveled to Fort Campbell, its active Army mobilization
station. As required by Army guidance, Fort Campbell personnel
conducted a second soldier readiness program intended, in part, to
verify the accuracy of soldiers' pay records. However, instead of
conducting a thorough review of each soldier's pay record, Fort
Campbell finance personnel performed only a perfunctory review by
asking the soldiers if they were experiencing pay problems. At this
point, because the soldiers had only recently mobilized and had not
received their first paychecks, they were unaware of pay problems.
Failure to follow requirements for finance verification at Fort
Campbell of each soldier's pay account caused pay problems to persist
past the mobilization stage. In addition, we were unable to determine
specific causes for certain pay problems associated with the unit's
mobilization because the unit remobilized in February 2003, and unit
administrative personnel did not retain payroll source documents
relating to the prior mobilization.
Deployment Pay Problems:
As summarized in table 18, we identified a number of pay problems
associated with four types of active duty pays and allowances
associated with the unit's deployment while on active duty.
Table 18: Identified Deployment Pay Problems:
Type of pay or allowance: Basic pay; Number of soldiers who did not
receive pay or allowances within 30 days of entitlement: 10; Number of
soldiers who were underpaid: 0; Number of soldiers who were overpaid:
0.
Type of pay or allowance: Family separation allowance; Number of
soldiers who did not receive pay or allowances within 30 days of
entitlement: 3; Number of soldiers who were underpaid: 0; Number of
soldiers who were overpaid: 3.
Type of pay or allowance: Basic allowance for housing; Number of
soldiers who did not receive pay or allowances within 30 days of
entitlement: 1; Number of soldiers who were underpaid: 0; Number of
soldiers who were overpaid: 0.
Type of pay or allowance: Hardship duty pay; Number of soldiers who did
not receive pay or allowances within 30 days of entitlement: 0; Number
of soldiers who were underpaid: 11; Number of soldiers who were
overpaid: 88.
Source: GAO analysis.
[End of table]
While at Fort Campbell, eight soldiers experienced problems resulting
from delays in entering changes in the family separation allowance,
basic allowance for housing, and active duty pay increases from
promotions. For example, one soldier was promoted to the rank of
Private First Class at the end of May, but the pay system did not
reflect the promotion until October. Although the soldier eventually
received retroactive promotion pay, the delay caused the soldier to be
paid at her old rank for 5 months. According to DFAS guidance, when a
change occurs in a soldier's pay, the on-site Army finance office
should input the change. In cases where personnel changes occurred that
affected pay, either the soldiers failed to submit documents or
personnel at Fort Campbell failed to input the changes. Due to the lack
of documentation, we could not determine the origin of the delays.
During the unit's deployment to Guantanamo Bay, Cuba, the soldiers
encountered additional pay problems related to hardship duty pay, a
location-based payment for soldiers located at designated hardship duty
locations. Some soldiers received extra hardship duty payments, while
others were only paid sporadically. In total, only 9 of the 100
soldiers who deployed to Guantanamo Bay with the 114TH Military Police
Company received the correctly computed hardship duty pay.
Per DOD FMR, Volume 7A, chapter 17, soldiers who perform duties in
designated areas for over 30 days are entitled to the hardship duty pay
incentive. The FMR provides for two mutually exclusive types of
hardship duty pay for identified locations; one according to specified
"designated areas" and the other for specified "certain places."
Effective December 2001, the regulation no longer permitted soldiers
newly assigned to locations specified as certain places to begin
receiving hardship duty pay. However, the regulation specified
Guantanamo Bay, Cuba, as a designated area and provided for paying $50
a month to each soldier serving there.
Most of the 114TH Military Police unit's soldiers were mistakenly
provided both types of hardship duty pay while deployed to Cuba. Upon
arrival in Cuba, the local Guantanamo Bay finance office correctly
entered transactions to start hardship duty pay for designated areas
for the 114TH Military Police unit's soldiers into DJMS-RC. However,
unknown to Guantanamo finance personnel, Fort Campbell finance
personnel, upon the unit's departure to Cuba, incorrectly initiated
recurring certain places hardship duty payments for the soldiers of the
114TH Military Police unit. These payments of both types of hardship
duty pay resulted in overpayments to 88 enlisted soldiers of the 114TH
Military Police Company during the time the soldiers were stationed in
Cuba.
In addition, as a result of personnel turnover and heavy workload in
the active Army's Guantanamo Bay finance office and limitations in
DJMS-RC, the Guantanamo Bay finance office did not make all the
required monthly manual transaction entries required to pay hardship
duty pays to the 114TH Military Police Company's soldiers. As a result,
several soldiers in the unit did not receive one or more monthly
hardship duty payments. Limitations in DJMS-RC required the local
finance office to manually enter the designated area payments for each
soldier on a monthly basis. For 11 soldiers, the finance office
inadvertently overlooked entering one or more monthly hardship duty
payments. The combination of erroneous certain places payments, along
with sporadic payments of hardship duty designated area pays caused
confusion for the soldiers who were performing a stressful mission in
Cuba regarding whether they were receiving all their active duty pay
entitlements.
Pay Problems Associated with Demobilization and Release from Active
Duty:
The 114TH Military Police Company returned to Fort Campbell on November
23, 2002, to begin the demobilization process. During demobilization,
soldiers continued to experience pay problems. As summarized in table
19, overpayment problems consisted of improper continuation of hardship
duty pay following the unit's return from Cuba and failure to stop
active duty pay and allowances to soldiers who were discharged or
returned from active duty early.
Table 19: Identified Demobilization Pay Problems:
Type of pay or allowance: Basic pay; Number of soldiers who were
overpaid: 5.
Type of pay or allowance: Family separation allowance; Number of
soldiers who were overpaid: 5.
Type of pay or allowance: Basic allowance for subsistence; Number of
soldiers who were overpaid: 5.
Type of pay or allowance: Basic allowance for housing; Number of
soldiers who were overpaid: 5.
Type of pay or allowance: Hardship duty pay; Number of soldiers who
were overpaid: 85.
Source: GAO analysis.
[End of table]
According to the DOD FMR, Volume 7A, chapter 17, soldiers are entitled
to receive hardship duty pay only while they are stationed in a
hardship duty location. While the active Army's Guantanamo Bay finance
office stopped monthly designated area payments upon the unit's
departure from Cuba, the Fort Campbell finance office did not
discontinue the incorrect certain places payments that its finance
office had initiated months earlier. Consequently, 85 of 88 soldiers of
the 114TH Military Police unit's soldiers continued receiving the
incorrect certain places payments through their last day of active
duty.
In addition, five soldiers continued to receive active duty pay and
allowances after being discharged or returned from active duty. Instead
of demobilizing on schedule with their unit, these five soldiers
demobilized individually earlier due to various reasons. According to
DFAS guidance, Fort Campbell, the designated demobilization station for
the 114TH Military Police Company, was responsible for stopping active
duty pay for the unit's demobilizing soldiers. However, when these
individual soldiers were released from active duty, Fort Campbell
processed discharge orders but Fort Campbell's finance office failed to
stop their pay. Further, in at least one case in which documentation
was available, state USPFO military pay personnel did not immediately
detect the overpayments in monthly pay system mismatch
reports.[Footnote 22] For these five soldiers, overpayments continued
for up to 3 months.
One of these soldiers was discharged early because of drug-related
charges. However, his pay continued for 3 months past his discharge
date. By the time the USPFO stopped the active duty pay, the former
soldier had received overpayments of about $9,400. Although the state
USPFO military pay personnel stopped the active duty pay in September
2002, no attempt to collect the overpayment was made until we
identified the problem. In July 2003, state military pay personnel
initiated collection for the overpayment.
Another soldier was discharged on July 8, 2002, for family hardship
reasons, but his active duty pay was not stopped until August 15,
resulting in an overpayment. Another 114TH Military Police soldier was
returned from active duty on September 11, 2002, for family hardship
reasons, but his active duty pay was not stopped until November 30,
resulting in an overpayment of about $8,600. Another soldier, facing
disciplinary proceedings related to a domestic violence incident,
agreed to an early discharge on May 22, 2002. However, the soldier's
active duty pay was not stopped until the unit administrative officer,
while deployed in Cuba, reviewed the unit commander's finance report
and discovered the soldier still on company pay records and reported
the error. Following his discharge, this soldier continued to receive
active duty pay until August 31, resulting in an overpayment.
:
[End of section]
Appendix V: Maryland 200th Military Police Company:
The 200th Military Police Company was called to active duty in support
of Operation Noble Eagle on October 1, 2001, for a period not to exceed
365 days. The unit, including 90 soldiers who received orders to
mobilize with the 200TH Military Police Company, reported to its home
station, Salisbury, Maryland, on October 1, 2001, and then proceeded to
Camp Fretterd located in Reisterstown, Maryland, for the soldier
readiness program (SRP) in-processing. On October 13, 2001, they
arrived at their designated mobilization station at Fort Stewart,
Georgia, where they remained for the next 2 weeks undergoing additional
in-processing.[Footnote 23] The unit performed general military police
guard duties at Fort Stewart until December 15, 2001, when 87 of the
soldiers in the unit were deployed to guard the Pentagon. The company
arrived at Ft. Eustis, Virginia, in late August 2002 and was released
from active duty on September 30, 2002. In addition, 3 of the 90
soldiers who received orders from the 200TH Military Police Company
were deployed in January 2002 to Guantanamo Bay, Cuba, to perform base
security and guard duties with Maryland's 115TH Military Police
Company. These soldiers demobilized at Fort Stewart, Georgia, where
they were released from active duty on July 10, 2002. A time line of
key actions associated with the unit's mobilization under Operation
Noble Eagle is shown in figure 14.
Figure 14: Timeline Showing Key Actions Associated with the Maryland
National Guard Military Police Unit's Mobilization:
[See PDF for image]
[End of figure]
As summarized in table 20, the majority of soldiers from the company
experienced some sort of pay problem during one or more phases of the
three phases of their active duty mobilization. Overall, 83 of the
company's 90 soldiers experienced at least one pay problem associated
with their mobilization in support of Operation Noble Eagle. Pay
problems included overpayments, underpayments, and late payments of
entitlements, such as basic pay, basic allowance for housing, basic
allowance for subsistence, family separation allowance and hardship
duty pay associated with their initial mobilization, deployment to Fort
Stewart, the Pentagon, and Cuba; and demobilization from active duty
status.
Table 20: Summary of Identified Pay Problems by Phase:
Phase: Mobilization; Number of soldiers with pay problems: 75 of 90.
Phase: Deployed; Number of soldiers with pay problems: 64 of 90.
Phase: Demobilization; Number of soldiers with pay problems: 3 of 90.
Source: GAO analysis.
[End of table]
In total, we identified estimated overpayments of $74,000,
underpayments of $11,000, and late payments of $10,000, associated with
the pay problems we identified. Of the estimated $74,000 in identified
overpayments, we identified about $32,000 that was subsequently
collected from the unit's soldiers. Specifically, we determined that:
* 75 soldiers were overpaid, underpaid, and/or paid late during the
period of mobilization, including a soldier who did not receive correct
payments for up to 7 months after the mobilization date;
* 64 soldiers experienced pay problems during their tour of active duty
related to the proper payment of basic pay, basic allowance for
subsistence, basic allowance for housing, family separation allowance,
and location-based pays such as hardship duty pay; and:
* 3 soldiers experienced pay problems during their demobilization from
Fort Stewart related to continuation of active duty pay entitlements
after they were released early from active duty.
We identified a number of causes associated with these pay problems,
including delays in submitting documents, incorrect data entry, and
limited personnel to process the mass mobilizations. Maryland's USPFO
officials told us they had not experienced a large-scale mobilization
to active duty in more than 10 years.
Mobilization Pay Problems:
As summarized in table 21, we identified a number of pay problems
associated with eight different types of active duty pays and
allowances associated with the unit's mobilization to active duty.
Seventy-five of 90 soldiers from the 200thTH Military Police Company
did not receive the correct or timely entitlements related to basic
pay, basic allowance for housing, basic allowance for subsistence, or
family separation allowance when called to active duty.
Table 21: Identified Mobilization Pay Problems:
Type of pay or allowance: Basic pay; Number of soldiers who did not
receive pay or allowances within 30 days of entitlement: 4; Number of
soldiers who were underpaid: 0; Number of soldiers who were overpaid:
13.
Type of pay or allowance: Basic allowance for housing; Number of
soldiers who did not receive pay or allowances within 30 days of
entitlement: 4; Number of soldiers who were underpaid: 24; Number of
soldiers who were overpaid: 16.
Type of pay or allowance: Basic allowance for subsistence; Number of
soldiers who did not receive pay or allowances within 30 days of
entitlement: 3; Number of soldiers who were underpaid: 1; Number of
soldiers who were overpaid: 21.
Type of pay or allowance: Family separation allowance; Number of
soldiers who did not receive pay or allowances within 30 days of
entitlement: 11; Number of soldiers who were underpaid: 42; Number of
soldiers who were overpaid: 2.
Source: GAO analysis.
[End of table]
Thirteen soldiers received overpayments because they continued to
receive pay after they were released early from active duty. These
soldiers mobilized on October 1, 2001, and then received amended orders
to be released from active duty around October 13, 2001. However, many
continued to receive basic pay, basic allowance for subsistence, basic
allowance for housing, and family separation allowance payments through
the end of November 2001. The unit administrator stated that many of
these soldiers received amended orders after their initial mobilization
when it was determined that they were not deployable for a variety of
reasons, such as health or family problems. The overpayments occurred
because the Maryland Army Guard command was not informed by either unit
personnel or the active component that individuals (1) did not deploy
or (2) were released from active duty early. The Maryland Army Guard
command initiated amendment orders to stop the active duty pays when it
became aware of the problem; however, the orders were not generated in
time for the USPFO to stop active duty pays in the system.
Specifically, in order for pay to be stopped by October 13, 2001, the
USPFO must have received and processed the amended orders by October 8,
2001. However, the Maryland Army Guard command did not generate many of
the amended orders until November 14, 2001, at which time they would
have been sent to the unit and then forwarded to the USPFO too late to
meet the pay cutoff.
An additional soldier was issued an amended order to release him from
active duty on October 13, 2001. Upon our review of his pay account, we
determined that he continued to receive active duty pay and allowances
for an entire year. We spoke with the unit administrator about this
soldier and determined that he mobilized with the unit and was deployed
for the entire year that he was paid. The unit administrator and
Maryland Army Guard command, along with the USPFO pay officials, were
not sure why the amendment order was never processed. They believe that
the amendment fell through the cracks due to the general confusion and
the limited personnel processing the mass mobilizations after September
11, 2001. Based on our inquiries, the Maryland Army Guard command
generated an amendment on August 21, 2003, to reinstate the original
order to avoid future questions regarding the soldier's tour of duty.
Further, 42 soldiers from the unit were underpaid their entitled family
separation allowance when they mobilized. Soldiers are entitled to
receive a family separation allowance after they have been deployed
away from home for more than 30 days. We found that these underpayments
occurred as a result of Maryland USPFO military pay officials' errors
in calculating the start and stop dates for this allowance.
Several soldiers did not receive the correct type of basic allowance
for housing after being mobilized as specified in the DOD FMR, Volume
7A, chapter 26. We were unable to determine specific causes and amounts
of all the unit's problems associated with the basic allowance for
housing because the unit had remobilized in July 2003 and some of the
historical records relating to housing entitlements applicable to the
prior mobilization could not be located. Furthermore, the original unit
administrator had retired, leaving limited records of the prior
mobilization for the current unit administrator. Based on our
inquiries, we determined that some soldiers were underpaid their
housing allowance because the Maryland USPFO military pay officials
entered the incorrect date for the tour and therefore shortened the
unit's soldiers' allowance by 1 day. Other soldiers did not receive the
correct amount for this allowance as a result of different
interpretations of how to enter "dependent" information provided on
housing allowance application forms (Form 5960). According to personnel
officials, married soldiers are required to write in their spouses'
names as dependents on Form 5960 in order to receive the higher housing
allowance amount. However, guidance did not clearly specify that simply
checking the box indicating that they are married is not sufficient
support to receive the higher housing allowance (with dependents) rate.
As a result, several soldiers' dependent information was not loaded
into the personnel system correctly, and they were paid a single rate
housing allowance instead of the higher married rate allowance.
Other soldiers did not receive the correct housing allowance because
they did not turn in complete forms and documentation to initiate the
correct allowance rate or were late in turning in documents. For
example, one soldier, who appeared to have submitted his lease
agreement 6 days after being called to active duty, did not receive the
correct housing allowance amount for the first 2 months of active duty.
During his entire deployment, the soldier attempted to get various unit
and military pay officials to take action to initiate back pay for
these housing allowance underpayments, including forwarding copies of
the lease agreement as proof for payment on three different occasions.
As of March 30, 2003, the soldier had not received the correct housing
allowance for October and November 2001. Another soldier did not
receive the correct amount of housing allowance after his mobilization
and complained to the unit administrator. Seven months after his
initial mobilization to active duty, finance officials at the active
duty station in Fort Belvoir, Virginia, who were attempting to correct
the soldier's housing allowance instead inadvertently entered a
transaction to collect the entire amount of the housing allowance
previously paid to the soldier. Finance officials at Fort Belvoir
subsequently entered a transaction to reverse the error and pay the
soldier a "catch-up" housing allowance payment.
Deployment Pay Problems:
As summarized in table 22, we identified a number of pay problems
associated with five different types of active duty pays and allowances
associated with the unit's deployment.
Table 22: Identified Deployment Pay Problems:
Type of pay or allowance: Basic pay; Number of soldiers who did not
receive pay or allowance within 30 days of entitlement: 1; Number of
soldiers who were underpaid: 0; Number of soldiers who were overpaid:
1.
Type of pay or allowance: Basic allowance for housing; Number of
soldiers who did not receive pay or allowance within 30 days of
entitlement: 0; Number of soldiers who were underpaid: 0; Number of
soldiers who were overpaid: 1.
Type of pay or allowance: Basic allowance for subsistence; Number of
soldiers who did not receive pay or allowance within 30 days of
entitlement: 0; Number of soldiers who were underpaid: 1; Number of
soldiers who were overpaid: 62.
Type of pay or allowance: Family separation allowance; Number of
soldiers who did not receive pay or allowance within 30 days of
entitlement: 0; Number of soldiers who were underpaid: 1; Number of
soldiers who were overpaid: 1.
Type of pay or allowance: Hardship duty pay; Number of soldiers who did
not receive pay or allowance within 30 days of entitlement: 3; Number
of soldiers who were underpaid: 3; Number of soldiers who were
overpaid: 0.
Source: GAO analysis.
[End of table]
Sixty-two soldiers from the unit were overpaid their entitled
subsistence allowance by active Army finance personnel while stationed
at the Pentagon during the period of December 15, 2001, through
December 31, 2001. Prior to this period, the soldiers were stationed at
Fort Stewart and were not provided lodging or mess and properly
received the full subsistence allowance. When the unit was redeployed
to the Pentagon, mess facilities became available. However, active Army
finance personnel did not reduce the unit's subsistence allowance rate
to reflect the available mess facilities. According to DOD FMR, Volume
7A, chapter 25, enlisted soldiers are not entitled to the full
subsistence allowance when mess facilities are provided.
In January 2002, three soldiers who received mobilization orders from
the 200th MP Company left Fort Stewart and traveled with the 115TH
Military Police Company to Guantanamo Bay, Cuba, to assist with base
security and guard duties. While in Cuba, the soldiers were either
underpaid, or were late in receiving their entitled hardship duty pays.
In accordance with DOD FMR Volume 7A, chapter 17, soldiers who perform
duties in "designated areas" for over 30 days are entitled to hardship
duty pay. The FMR specifies Guantanamo Bay, Cuba, as a designated area
and provides payment of $50 a month to soldiers serving there. While
deployed to Cuba, the three soldiers were mistakenly paid the old type
of hardship duty pay. Since hardship duty pay is not an automated pay,
the active Army finance office at Guantanamo Bay was required to
manually enter the "designated areas" payment each month for each
soldier. While they were in Cuba, the three soldiers did not receive
all their entitled hardship duty pays. Furthermore, the hardship duty
pays they did receive were more than 30 days late.
Demobilization and Release from Active Duty Pay Problems:
The 200th Military Police Company returned to Fort Eustis around the
end of August 2002 to begin the demobilization process. We did not
identify any pay issues associated with the unit's soldiers who were
released from active duty on September 30, 2002 (the original date for
the unit's demobilization, designated on the mobilization orders).
However, as shown in table 23, we did identify three soldiers who
continued to receive active duty pay after their early release from
active duty.
Table 23: Identified Demobilization Pay Problems:
Type of pay or allowance: Basic pay; Number of soldiers who were
overpaid: 3.
Type of pay or allowance: Basic allowance for housing; Number of
soldiers who were overpaid: 3.
Type of pay or allowance: Basic allowance for subsistence; Number of
soldiers who were overpaid: 3.
Type of pay or allowance: Family separation allowance; Number of
soldiers who were overpaid: 3.
Type of pay or allowance: Hardship duty pay; Number of soldiers who
were overpaid: 2.
Source: GAO analysis.
[End of table]
Specifically, the three soldiers from the unit returned from Cuba,
demobilized at Fort Stewart, and were released from active duty on July
10, 2002, while their original orders showed a September 30, 2002,
release date. They continued to receive active duty pay and allowances
through July 15, 2002. Fort Stewart did not provide the amended orders
with the earlier release date to the Maryland USPFO office in time to
stop the pay.
[End of section]
Appendix VI: California 49th Military Police Headquarters and
Headquarters Detachment:
On October 2, 2001, California's 49th Military Police Headquarters and
Headquarters Detachment (HHD) was mobilized to active duty for a period
not to exceed 24 months. The 49th MP HHD mobilized at its home station,
Pittsburg, California, and then proceeded to its designated
mobilization station, Fort Lewis, Washington, on October 12, 2001. The
unit performed its active duty mission at Fort Lewis, where it provided
base security as part of Operation Noble Eagle. The unit was
demobilized from active duty at Fort Lewis on July 28, 2002. A time
line of the unit's actions with respect to its mobilization under
Operation Noble Eagle is shown in figure 15.
Figure 15: Timeline Showing Key Actions Associated with the California
Army National Guard Military Police Unit's Mobilization:
[See PDF for image]
[End of figure]
Almost all soldiers from the 49TH Military Police Company experienced
some sort of pay problem during one or more phases of the three phases
of the active duty mobilization. Overall, 50 of the 51 soldiers with
the unit had at least one pay problem associated with their
mobilization to active duty in support of Operation Noble Eagle. These
pay problems included not receiving pays and allowances at all
(underpayments), receiving some pays and allowances over 30 days after
entitlement (late payments), and the overpayment of allowances.
Specifically, as summarized in table 24, we found that (1) 48 soldiers
did not receive certain pay and allowances within 30 days of their
initial mobilization entitlement and (2) 41 soldiers did not receive,
or did not receive within 30 days, the pay and allowances they were
entitled to receive during their deployment.
Table 24: Summary of Identified Pay Problems by Phase:
Phase: Mobilization; Number of Soldiers with pay problems: 48 of 51.
Phase: Deployed; Number of Soldiers with pay problems: 41 of 51.
Phase: Demobilization; Number of Soldiers with pay problems: 0 of 51.
Source: GAO analysis.
[End of table]
In total, we identified estimated overpayments of $17,000,
underpayments of $1,300, and late payments of $67,000 associated with
the pay problems we found. In addition, of the $17,000 in overpayments,
we found that less than $100 was subsequently collected from the
soldiers.
We determined a number of causes for these pay problems. First, we
found a lack of sufficient numbers of knowledgeable staff. In addition,
after-the-fact detective controls were not in place, including a
reconciliation of pay and personnel records and the reconciliation of
pay records with the unit commander's records of personnel actually
onboard. Currently, as a matter of practice, pay and personnel
representatives from the USPFO conduct a manual reconciliation between
the pay and personnel system records approximately every 2 months. The
purpose of the reconciliation is to ensure that for common data
elements, the pay and personnel systems contain the same data. A USPFO
official told us that while it is the USPFO's goal to carry out such
reconciliations each month, it currently does not have the resources
required to do so.
Mobilization Pay Problems:
As summarized in table 25, we identified a number of pay problems
associated with the unit's mobilization to active duty. Failures to
enter transactions or late entry of transactions needed to start active
duty pays by Army Guard USPFO military pay personnel and by active Army
military pay personnel at the unit's mobilization station were the
initial cause of the pay problems. We also found that the underlying
cause of the pay problems was a lack of sufficient numbers of
knowledgeable personnel at the California USPFO and the Fort Lewis
Finance Office. In addition, according to Army Guard and active Army
officials, neither organization was prepared for the sheer volume of
pay transactions associated with mobilizing soldiers to active duty.
Table 25: Identified Mobilization Pay Problems:
Type of pay or allowance: Basic pay; Number of soldiers who did not
receive pay or allowance within 30 days of entitlement: 17.
Type of pay or allowance: Basic allowance for housing; Number of
soldiers who did not receive pay or allowance within 30 days of
entitlement: 18.
Type of pay or allowance: Basic allowance for subsistence; Number of
soldiers who did not receive pay or allowance within 30 days of
entitlement: 18.
Type of pay or allowance: Family separation allowance; Number of
soldiers who did not receive pay or allowance within 30 days of
entitlement: 39.
Type of pay or allowance: Cost of living allowance; Number of soldiers
who did not receive pay or allowance within 30 days of entitlement: 36.
Source: GAO analysis.
[End of table]
In total, 48 out of 51 soldiers of the 49TH Military Police Company did
not receive certain pay and allowances and incentive pays at all, or
did not receive them within 30 days after being mobilized on October 2,
2001. The types of pay entitlements either not paid at all or paid late
associated with the unit's initial mobilization included basic pay,
basic allowance for subsistence, basic allowance for housing, family
separation allowance, and the continental United States cost of living
allowance.
The late payments during the mobilization phase primarily resulted from
California USPFO military pay personnel's lack of understanding of
their responsibility for initiating active duty pays. According to DFAS
reserve component mobilization procedures; the California USPFO was
responsible for initiating these pays. However, a USPFO military pay
official mistakenly instructed the unit to take its pay data to the
mobilization station to enter transactions to start active duty pays.
The USPFO official stated that the USPFO did not start the active duty
pay and allowances at that time because a copy machine was not
available to make copies of relevant active duty pay support
documentation (such as a lease agreement needed to support a housing
allowance entitlement). As a result, the responsibility for initiating
this allowance was improperly passed to the active Army finance office
at the Fort Lewis mobilization station.
The Fort Lewis finance office lacked sufficient numbers of
knowledgeable military pay staff to expeditiously enter the large
volume of transactions necessary to start active duty pay entitlements
for the 49th Military Police Company's soldiers. DFAS guidance requires
finance personnel at the mobilization station to review each soldier's
pay account to identify any errors and input the necessary correcting
transactions into DJMS-RC. Initially, the mobilization station finance
office assigned an insufficient number of personnel to the task of
starting active duty pays for the unit's 51 mobilizing soldiers.
Moreover, one of the assigned pay technicians was not familiar with
DJMS-RC and consequently entered data incorrectly for some of the
unit's soldiers. Also, the assigned pay technician initially failed to
enter transactions to start pay and allowances for a significant number
of the unit's soldiers because the supporting documentation was
misplaced. These documents were later found under a desk in the finance
office.
Recognizing this shortage of staff knowledgeable about DJMS-RC
processing procedures, the Fort Lewis finance office asked the
California USPFO to supply additional personnel and also temporarily
reassigned soldiers from other units stationed at Fort Lewis to assist
in the pay processing. Working together over a 2-month period after the
unit was mobilized to active duty, these personnel were able to enter
the omitted transactions needed to start active duty pays and correct
the previous erroneous entries.
In addition, the USPFO did not enter the required data to DJMS-RC to
begin cost of living allowance pays for 36 of the unit's soldiers. DFAS
reserve component mobilization procedures state that the USPFO has the
initial responsibility for initiating these pays. However, as discussed
previously, the USPFO mistakenly sent the 49th Military Police Company
to Fort Lewis with their pay documentation, and as a result, it was not
until more than 2 months after the unit's mobilization date that the
Fort Lewis finance office pay technicians began to enter these
transactions into DJMS-RC.
The company commander for the unit told us that he was frustrated with
the level of customer support his unit received as it moved through the
initial mobilization process. Only two knowledgeable military pay
officials were present to support active duty pay transaction
processing for the 51 soldiers mobilized for his unit. He characterized
the customer service his unit received at initial mobilization as very
time-consuming and frustrating.
Deployment Pay Problems:
As summarized in table 26, we identified a number of pay problems
associated with six different types of active duty pays and allowances
associated with the unit's deployment while on active duty. These
problems primarily resulted from a data entry error and inadequate
document retention practices.
Table 26: Identified Deployment Pay Problems:
Type of pay or allowance: Basic pay; Number of soldiers who did not
receive pay or allowances within 30 days of entitlement: 1; Number of
soldiers who were underpaid: 0; Number of soldiers who were overpaid:
5.
Type of pay or allowance: Basic allowance for subsistence; Number of
soldiers who did not receive pay or allowances within 30 days of
entitlement: 1; Number of soldiers who were underpaid: 0; Number of
soldiers who were overpaid: 5.
Type of pay or allowance: Basic allowance for housing; Number of
soldiers who did not receive pay or allowances within 30 days of
entitlement: 1; Number of soldiers who were underpaid: 0; Number of
soldiers who were overpaid: 5.
Type of pay or allowance: Family separation allowance; Number of
soldiers who did not receive pay or allowances within 30 days of
entitlement: 0; Number of soldiers who were underpaid: 0; Number of
soldiers who were overpaid: 6.
Type of pay or allowance: Foreign language proficiency pay; Number of
soldiers who did not receive pay or allowances within 30 days of
entitlement: 4; Number of soldiers who were underpaid: 2; Number of
soldiers who were overpaid: 1.
Type of pay or allowance: Cost of living allowance; Number of soldiers
who did not receive pay or allowances within 30 days of entitlement:
37; Number of soldiers who were underpaid: 4; Number of soldiers who
were overpaid: 0.
Source: GAO analysis.
[End of table]
For example, the USPFO paid one soldier her basic pay, basic allowance
for subsistence, and basic allowance for housing nearly 4 months late.
A USPFO official told us these late payments were caused when a USPFO
pay technician entered an incorrect stop date for the soldier's active
duty tour into DJMS-RC. The pay technician, after being notified of the
error by the soldier, corrected the data in DJMS-RC, which resulted in
the soldier receiving her pay nearly 4 months late. Additionally, USPFO
officials were unable to provide support explaining why five other
soldiers continued to receive basic pay, the basic allowance for
subsistence, and the basic allowance for housing after the date
available records show their active duty tours had ended. Consequently,
we identified the payments made to these five soldiers as overpayments.
Overpayments of family separation allowances to soldiers in the unit
resulted from a data entry error and inadequate USPFO document
retention practices. A USPFO pay technician incorrectly coded a
soldier's account to receive a family separation allowance when the
soldier had only been on active duty for 2 weeks. According to the DOD
FMR, Volume 7A, chapter 27, soldiers are only eligible for this
allowance after they have been separated more than 30 days from their
families on a continuous active duty assignment. This overpayment
problem had not been resolved as of March 31, 2003. Additionally, USPFO
officials were unable to provide supporting documentation explaining
why five soldiers continued to receive a family separation allowance
after available documentation showed that these soldiers' active duty
tours had officially ended. We identified these family separation
allowance payments for the five soldiers as overpayments.
Late, under-and overpayments of foreign language proficiency pays to
the unit's soldiers primarily resulted from delayed or inadequate data
entry. For example, our audit showed that USPFO pay technicians failed
to enter transactions into DJMS-RC in a timely manner for four soldiers
resulting in late foreign language proficiency payments. In addition,
USPFO pay technicians failed to enter any foreign language proficiency
payment transactions for 1 month for one soldier and for 3 months for
another soldier resulting in those soldiers being underpaid. This
underpayment issue had not been resolved as of March 31, 2003. In
another instance, a soldier received an overpayment of his entitled
foreign language proficiency payment when a USPFO pay technician
entered the wrong code. Approximately 3 months later, the USPFO pay
technician identified the error and recovered the overpayment.
Late payment, underpayment, and overpayment of cost of living
allowances resulted from the inability of DJMS-RC to pay certain active
duty pays and allowances automatically, inaccurate data entry, and
inadequate documentation retention practices. For example, our audit
discovered that USPFO pay technicians failed to manually enter cost of
living allowance transactions into DJMS-RC in a timely manner for 37
soldiers, resulting in late payments to the soldiers. In addition,
USPFO officials were unable to provide sufficient documentation to
explain why 3 soldiers appeared not to have received cost of living
allowance payments due them for a 2-month period. We considered these
pay omissions to be underpayments. An Army pay technician at the Fort
Lewis finance office entered the incorrect code, thereby paying a
soldier the wrong type of allowance, which resulted in an underpayment.
Pay Problems Associated with Demobilization and Release from Active
Duty:
California's 49th Military Police Company demobilized at Fort Lewis on
July 28, 2002, and returned to its home station in Pittsburg,
California. We did not identify any pay problems for this unit in the
demobilization phase.
:
[End of section]
Appendix VII: Scope and Methodology:
To obtain an understanding and assess the processes, personnel (human
capital), and systems used to provide assurance that mobilized Army
Guard soldiers were paid accurately and timely, we reviewed applicable
policies, procedures, and program guidance; observed pay processing
operations; and interviewed cognizant agency officials. With respect to
applicable policies and procedures, we obtained and reviewed 10 U.S.C.
Section 12302, DOD Directive Number 1235.10, "Activation, Mobilization
& Demobilization of the Ready Reserve;" DOD FMR, Volume 7A, "Military
Pay Policy and Procedures Active Duty and Reserve Pay"; and the Army
Forces Command Regulations 500-3-3, Reserve Component Unit Commander
Handbook, 500-3-4, Installation Commander Handbook, and 500-3-5,
Demobilization Plan. We also reviewed various Under Secretary of
Defense memorandums, a memorandum of agreement between Army and DFAS,
DFAS, Army, Army Forces Command, and Army National Guard guidance
applicable to pay for mobilized reserve component soldiers. We also
used the internal controls standards provided in the Standards for
Internal Control in Federal Government.[Footnote 24]
We applied the policies and procedures prescribed in these documents to
the observed and documented procedures and practices followed by the
various DOD components involved in providing active duty pays to Army
Guard soldiers. We also interviewed officials from the National Guard
Bureau, State USPFOs, Army and DOD military pay offices, as well as
unit commanders to obtain an understanding of their experiences in
applying these policies and procedures.
In addition, as part of our audit, we performed a review of certain
edit and validation checks in DJMS-RC. Specifically, we obtained
documentation and performed walk-throughs associated with DJMS-RC edits
performed on pay status/active duty change transactions, such as those
to ensure that tour start and stop dates match MMPA dates and that the
soldier cannot be paid basic pay and allowances beyond the stop date
that was entered into DJMS-RC. We also obtained documentation on and
walk-throughs of the personnel-to-pay system interface process, the
order writing-to-pay system interface process, and on the process for
entering mobilization information into the pay system. We held
interviews with officials from the Army National Guard Readiness
Center, the National Guard Bureau, and DFAS Indianapolis and Denver to
augment our documentation and walkthroughs.
Because our preliminary assessment determined that current operations
used to pay mobilized Army Guard soldiers relied extensively on error-
prone manual transactions entry into multiple, nonintegrated systems,
we did not statistically test current processes and controls. Instead,
we used a case study approach to provide a more detailed perspective of
the nature of pay deficiencies in the three key areas of processes,
people (human capital), and systems. Specifically, we gathered
available data and analyzed the pay experiences of Army Guard special
forces and military police units mobilized to active duty in support of
Operations Noble Eagle and Enduring Freedom during the period from
October 2001 through March 2003. We audited six Army Guard units as
case studies of the effectiveness of the controls over active duty pays
in place for soldiers assigned to those units:
* Colorado B Company, 5TH Battalion, 19TH Special Forces;
* Virginia B Company, 3RD Battalion, 20TH Special Forces;
* West Virginia C Company, 2ND Battalion, 19TH Special Forces;
* Mississippi 114TH Military Police Company;
* California 49th Military Police Headquarters and Headquarters
Detachment; and:
* Maryland 200TH Military Police Company.
In selecting these six units for our case studies, we sought to obtain
the pay experiences of units assigned to either Operation Enduring
Freedom or Operation Noble Eagle. We further limited our case study
selection to those units both mobilized to active duty and demobilized
from active duty during the period from October 1, 2001 through March
31, 2003. From the population of all Army Guard units mobilized and
demobilized during this period, we selected three special forces units
and three military police units. These case studies are presented to
provide a more detailed view of the types and causes of pay problems
and the pay experiences of these units as well as the financial impact
of pay problems on individual soldiers and their families.
We used mobilization data supplied by the Army Operations Center to
assist us in selecting the six units we used as our case studies. We
did not independently verify the reliability of the Army Operations
Center database. We used the Army Operations Center data to select six
states that had a large number of special forces or military police
units that had been mobilized, deployed, and returned from at least one
tour of active duty in support of Operations Noble Eagle and Enduring
Freedom. We chose California, Colorado, Maryland, Mississippi,
Virginia, and West Virginia. From these six states, we selected three
special forces and three military police units that had a variety of
deployment locations and missions. We also identified and performed a
limited review of the pay experiences of a unit still deployed during
the period of our review; Colorado's 220th Military Police Company. The
purpose of our limited review was to determine if there were any pay
problems experienced by a more recently mobilized unit.
We also obtained in-depth information from soldiers at four of the six
case study units. Using a data collection instrument, we asked for
soldier views on pay problems and customer service experiences before,
during, and after mobilization. Unit commanders distributed the
instrument to soldiers in their units. There were 325 soldiers in these
units; in total, we received 87 responses. The information we received
from these data collection instruments is not representative of the
views of the Army Guard members in these units nor of those of Army
Guard members overall. The information provides further insight into
some of the pay experiences of selected Army Guard soldiers who were
mobilized under Operations Noble Eagle and Enduring Freedom.
We used DJMS-RC pay transaction extracts to identify pay problems
associated with our case study units. However, we did not perform an
exact calculation of the net pay soldiers should have received in
comparison with what DJMS-RC records show they received. Rather, we
used available documentation and follow-up inquiries with cognizant
USPFO personnel to identify if (1) soldiers' entitled active duty pays
and allowances were received within 30 days of initial mobilization
date, (2) soldiers were paid within 30 days of the date they became
eligible for active duty pays and allowances associated with their
deployment locations, and (3) soldiers stopped receiving active duty
pays and allowances as of the date of their demobilization from active
duty. As such, our audit results only reflect problems we identified.
Soldiers in our case study units may have experienced additional pay
problems that we did not identify. In addition, our work was not
designed to identify, and we did not identify, any fraudulent pay and
allowances to any Army Guard soldiers.
As a result of the lack of supporting documents, we likely did not
identify all of the pay problems related to the active duty
mobilizations of our case study units. However, for the pay problems we
identified, we counted soldiers' pay problems as a problem only in the
phase in which they first occurred even if the problems persisted into
other phases. For purposes of characterizing pay problems for this
report, we defined over-and underpayments as those pays or allowances
for mobilized Army Guard soldiers during the period from October 1,
2001, through March 31, 2003, that were in excess of (overpayment) or
less than (underpayment) the entitled payment. We considered as late
payments any active duty pays or allowances paid to the soldier over 30
days after the date on which the soldier was entitled to receive such
pays or allowances. As such, these payments were those that, although
late, addressed a previously unpaid entitlement.
We did not include any erroneous debts associated with these payments
as pay problems. In addition, we used available data to estimate
collections against identified overpayments through March 31, 2003. We
did not attempt to estimate payments received against identified
underpayments. We provided the support for the pay problems we
identified to appropriate officials, at each of our case study
locations so that they could fully develop and resolve any additional
amounts owed to the government or to the Army Guard soldiers.
We briefed DOD and Army officials, National Guard Bureau officials,
DFAS officials, and USPFO officials in the selected states on the
details of our audit, including our findings and their implications. On
October 10, 2003, we requested comments on a draft of this report. We
received comments on November 5, 2003, and have summarized those
comments in the "Agency Comments and Our Evaluation" section of this
report. DOD's comments are reprinted in appendix VIII. We conducted our
audit work from November 2002 through September 2003 in accordance with
U.S. generally accepted government auditing standards.
:
[End of section]
Appendix VIII: Comments from the Department of Defense:
UNDER SECRETARY OF DEFENSE:
1100 DEFENSE PENTAGON WASHINGTON, DC 20301-1100:
COMPTROLLER:
NOV 5 2003:
Mr. Gregory D. Kutz:
Director:
Financial Management and Assurance:
U.S. General Accounting Office:
Washington, DC 20548:
This is the Department of Defense (DoD) response to the General
Accounting Office (GAO) draft report, "Military Pay: Army National
Guard Personnel Mobilized to Active Duty Experienced Significant Pay
Problems," dated October 10, 2003, (GAO Code 192080/ GAO-04-89). The
DoD concurs with the 23 recommendations in the draft report and is
already taking action to correct the noted deficiencies.
The Department appreciates the opportunity to comment on the draft
report. My staff point of contact is Ms. Jacqueline Jenkins. She may be
reached by email: jacqueline .jenkins@osd.mil or by telephone at (703)
697-8282.
Sincerely,
Signed by:
Dov S. Zakheim:
Enclosure: As stated:
GAO DRAFT REPORT DATED OCTOBER 10, 2003:
GAO-04-89 (GAO CODE 192080):
"MILITARY PAY: ARMY NATIONAL GUARD PERSONNEL:
MOBILIZED TO ACTIVE DUTY EXPERIENCED:
SIGNIFICANT PAY PROBLEMS":
DEPARTMENT OF DEFENSE COMMENTS:
TO THE GAO RECOMMENDATIONS:
RECOMMENDATION 1: The GAO recommended that the Secretary of Defense
direct the Director of the Defense Finance and Accounting Service
(DFAS), in conjunction with the Under Secretary of Defense
(Comptroller), to establish a unified set of policies and procedures
for all Army Guard, Army, and DFAS personnel to follow for servicing
active duty pays for Army Guard personnel mobilized to active duty.
(p. 74/GAO Draft Report):
DoD RESPONSE: Concur. DFAS and the Army are jointly building on the
existing guidance procedures as published in FORSCOM REG 500-3-3,
(FORSCOM Mobilization and Deployment Planning System Form Deps, Volume
3, Reserve Component Commanders' Handbook dated July 15,1999); the
National Guard Standard Operating Procedure Contingency Operations; and
DFAS AIG Message dated December 19, 2002, Subject: Reserve Component-
Mobilization Procedures, to clearly define the roles and
responsibilities between mobilization/demobilization stations, United
States Property and Fiscal Offices (USPFOs), and deployed Army finance
elements. A joint task force has been established to review existing
procedural guidance, lessons learned to date, and available metrics. As
a first step, expanded central guidance will be published within the
next 30 days, which will further articulate the specific
responsibilities of the servicing finance activities. This breakout of
responsibilities will also be provided in a simple matrix form to
visually reinforce this guidance. Within approximately 60 days, the
Army and DFAS will begin compliance reviews of the mobilization/
demobilization stations to ensure adherence to published guidance and
to provide any further assistance these offices may require. Within the
next 3 to 6 months, the task force will build upon the existing
guidance to provide comprehensive procedures and related standards,
down to the individual technician level, for all offices and units
responsible for pay input support of mobilized soldiers.
RECOMMENDATION 2: The GAO recommended that the Secretary of Defense
direct the Secretary of the Army, in conjunction with the Under
Secretary of Defense (Comptroller), to establish performance measures
for obtaining supporting documentation and processing pay transactions.
(p. 75/Draft Report):
DoD RESPONSE: Concur. Standards for the timeliness of processing pay
transactions are currently in place for units, finance offices, and
central site. However, these standards are focused on the full range of
transactions and associated unit level data is generated based on the
normal permanent/home station relationship with a Reserve Component Pay
Support Office.
Within the next 6 months, DFAS and the Army will jointly review how
these existing mechanisms can be used to more succinctly capture data
specifically related to mobilized soldiers and units.
RECOMMENDATION 3: The GAO recommended that the Secretary of Defense
direct the Secretary of the Army, in conjunction with the Under
Secretary of Defense (Comptroller), to establish who is accountable for
stopping active duty pays for soldiers who return home separate from
their units. (p. 75/Draft Report):
DoD RESPONSE: Concur. Within the next 30 days, DFAS, in cooperation
with the Army, will reinforce existing procedures on responsibilities
for stopping active duty pays for soldiers who return home separate
from their units. This will be part of the revised guidance identified
in response to recommendation one. In addition, mechanisms have been
established to perform automated comparisons of personnel
demobilization records and the Defense Joint Military Pay System -
Reserve Component (DJMS-RC) to identify any demobilizing soldiers whose
tours in the pay system were not adjusted to coincide with the
demobilization date.
RECOMMENDATION 4: The GAO recommended that the Secretary of Defense
direct the Secretary of the Army, in conjunction with the Under
Secretary of Defense (Comptroller), to clarify the policies and
procedures for how to properly amend active duty orders, including
medical extensions. (p. 75/Draft Report):
DoD RESPONSE: Concur. For medical extensions, the Army published
revised guidance on June 10, 2003, reinforcing procedures on this
process. Included were the requirements for publishing orders prior to
the end date of the current active duty tour. Concerning the specific
case in Colorado cited by the GAO, DFAS and the Army have implemented
changes to the input systems to warn the operator processing a tour
cancellation when the correct input should be a tour curtailment.
Action is complete.
RECOMMENDATION 5: The GAO recommended that the Secretary of Defense
direct the Secretary of the Army, in conjunction with the Under
Secretary of Defense (Comptroller), to require Army Guard commands and
unit commanders to carry out complete monthly pay and personnel records
reconciliations and take necessary actions to correct any pay and
personnel record mismatches found each month. (p. 75/Draft Report):
DoD RESPONSE: Concur. Within 60 days, the Army will reinforce to all
reserve commands the importance of this requirement. As noted by the
GAO, this requirement is already included in US Army Forces Command
Regulation 500-3-3, Unit Commander's Handbook.
RECOMMENDATION 6: The GAO recommended that the Secretary of Defense
direct the Secretary of the Army, in conjunction with the Under
Secretary of Defense (Comptroller), to update policies and procedures
to reflect current legal and DoD administrative requirements with
respect to active duty pays and allowances and transaction processing
requirements for mobilized Army Guard soldiers. (p. 75/Draft Report):
DoD RESPONSE: Concur. In Fiscal Year 2004, DFAS, the Army, and National
Guard will respectively update the cited regulations under their
cognizance to the most current and accurate requirements.
RECOMMENDATION 7: The GAO recommended that the Secretary of Defense
direct the Secretary of the Army, in conjunction with the Under
Secretary of Defense (Comptroller), to consider expanding the scope of
the existing memorandum of understanding between DFAS and the Army
concerning the provisions of resources to support surge processing at
mobilization and demobilization sites to include providing additional
resources to support surge processing for pay start and stop
transactions requirements at Army Guard home stations during initial
soldier readiness programs. (p. 75/Draft Report):
DoD RESPONSE: Concur. The Army will work with the National Guard on
resourcing the USPFOs for mobilization/demobilization surges. However,
the memorandum of understanding between DFAS and the Army pertains only
to the management and resourcing of Defense Military Pay Offices, to
include their role in support of mobilization/ demobilization stations.
As such, it is not the appropriate vehicle to address staffing of USPFO
under the National Guard.
RECOMMENDATION 8: The GAO recommended that the Secretary of Defense
direct the Secretary of the Army, in conjunction with the Under
Secretary of Defense (Comptroller), to determine whether issues
concerning resource allocations for the military pay operations
identified at our case study units exist at all 54 USPFOs, and, if so,
take appropriate actions to address these issues. (p. 76/Draft Report):
DoD RESPONSE: Concur. To support surge requirements, the National Guard
could use additional National Guard soldiers being brought on active
duty in a Temporary Tour of Active Duty status to augment the USPFO
staff based on mobilization workload requirements. The additional
requirement and funding will need to be addressed by the supplemental
provided to Army. Normal manning at the USPFO, Military Pay Section is
based on Full Time Support authorized state strength levels.
RECOMMENDATION 9: The GAO recommended that the Secretary of Defense
direct the Secretary of the Army, in conjunction with the Under
Secretary of Defense (Comptroller), to determine whether concerns over
relatively low graded military pay technicians identified at our case
study units exist at all 54 USPFOs, and, if so, take appropriate
actions to address these issues. (p. 76/Draft Report):
DoD RESPONSE: Concur. Higher grades would provide a more stable and
experienced workforce at the USPFO. However, grade structure is
established based on guidance from the Office of Personnel Management
(OPM). The National Guard recently completed a review of grade levels
in the USPFOs' Comptroller sections and the current grade levels for
military pay technicians were validated as correct under OPM standards.
Action is complete.
RECOMMENDATION 10: The GAO recommended that the Secretary of Defense
direct the Secretary of the Army, in conjunction with the Under
Secretary of Defense (Comptroller), to modify existing training
policies and procedures to require all USPFO and active Army pay and or
finance personnel responsible for entering pay transactions for
mobilized Army Guard soldiers to receive appropriate training upon
assuming such duties. (p. 76/Draft Report):
DoD RESPONSE: Concur. The National Guard has instituted mobilization
specific training for pay technicians. The National Guard Financial
Services Center quality assurance program is currently used to monitor
completion of JUMPS Standard Terminal Input System (JUSTIS) training
for USPFO military pay technicians. The US Army Reserve Command (USARC)
has expanded training programs on DJMS-RC to help support the immediate
training needs of deploying units and mobilization/demobilization
stations. Over 35 training events have occurred since February 2002 in
support of deploying units and mobilization/demobilization sites. The
Army finance school is working with USARC to develop an exportable
training package on DJMS-RC, which should be available within the next
6 months. Additionally, DFAS and the Army are sending a joint training
team to Kuwait and Iraq in November 2003 to specifically address
reserve component support. For the midterm (6 months to 2 years), the
training on reserve component pay input for soldiers in finance
battalions and garrison support units will be evaluated to determine
how best to expand the training within the Army total training
infrastructure, particularly in light of the planned integration of
reserve and active component pay processing into a single system. The
Army finance school is already evaluating the expansion of the current
instruction on mobilized reserve component pay in the training
curriculum for the finance advanced individual training course.
RECOMMENDATION 11: The GAO recommended that the Secretary of Defense
direct the Secretary of the Army, in conjunction with the Under
Secretary of Defense (Comptroller), to require unit commanders to
receive training on the importance of adhering to requirements to
conduct annual pay support documentation reviews and carry out monthly
reconciliations. (p. 76/Draft Report):
DoD RESPONSE: Concur. The importance of conducting annual pay support
documentation reviews and monthly reconciliations will be incorporated
into precommand courses at the company level for the National Guard by
the end of Fiscal Year 2004.
RECOMMENDATION 12: The GAO recommended that the Secretary of Defense
direct the Secretary of the Army, in conjunction with the Under
Secretary of Defense (Comptroller), to establish an ongoing mechanism
to monitor the quality and completion of training for both pay and
finance personnel and unit commanders. (p. 76/Draft Report):
DoD RESPONSE: Concur. The National Guard currently reviews the training
status of military pay technicians at the USPFOs as part of the ongoing
quality assurance review program. The appropriate mechanism for
monitoring the training of unit commanders and finance battalion
personnel is dependent on the location of that training in the overall
Army training infrastructure (i.e. unit training is assessed as part of
the annual External Evaluation-ExEval) and, as such will be considered
as part of the overall evaluation of the reserve pay training addressed
in response to recommendation 10.
RECOMMENDATION 13: The GAO recommended that the Secretary of Defense
direct the Secretary of the Army, in conjunction with the Under
Secretary of Defense (Comptroller), to identify and evaluate options
for improving customer service provided to mobilized Army Guard
soldiers by providing improved procedures for informing soldiers of
their pay and allowance entitlements throughout their active duty
mobilization. (p. 76/Draft Report):
DoD RESPONSE: Concur. Within the next 30 days, the Army will prepare a
standard information flyer to be given to all mobilizing reservists.
The flyer will address entitlements as well as sources of pay support.
The flyer will be published via Army Knowledge Online and incorporated
into the overall revision to procedural guidance addressed in response
to recommendation one.
RECOMMENDATION 14: The GAO recommended that the Secretary of Defense
direct the Secretary of the Army, in conjunction with the Under
Secretary of Defense (Comptroller), to identify and evaluate options
for improving customer service provided to mobilized Army Guard
soldiers with respect to providing a single, well-advertised, source
for soldiers and their families to access for customer service for any
pay problems. (p. 77/Draft Report):
DoD RESPONSE: Concur. The existing centralized information sources on
individual soldiers pay will be expanded. Specifically, DFAS will
continue to add functionality to myPay for input of discretionary
actions. Additionally, DFAS is developing a separate view-only Personal
Identification Number capability which soldiers will be able to give
their dependents so they can see the Leave and Earning Statement
without being able to change anything on the pay record. This
enhancement is scheduled for August 2004. The DFAS also operates a
central customer service center for pay inquiries for all Services. The
toll free number for this center as well as the myPay internet address
will be incorporated in the flyer discussed in response to
recommendation 13 as well as continue being advertised in locations
such as Army Knowledge Online. Until the implementation of DIMHRS, with
full integration of pay and personnel, the processing of pay
transactions will still require the movement of some entitlement
information/authorization from units and personnel to finance via
paper. As such, a network of finance support activities is required to
geographically align with deployed combat and supporting personnel
units. As always, pay remains essentially a command responsibility. For
the individual soldier, the single source of pay support is his or her
unit, which in-turn interfaces with the appropriate finance and
personnel activities. For dependents of deployed soldiers, the single
source for finance, or any administrative issues, is either the rear
detachment of the soldiers' deployed unit or, for the National Guard,
the applicable State Family Assistance Coordinator.
RECOMMENDATION 15: The GAO recommended that the Secretary of Defense
direct the Secretary of the Army, in conjunction with the Under
Secretary of Defense (Comptroller), to review the pay problems we
identified at our six case study units to identify and resolve any
outstanding pay issues for the affected soldiers. (p. 77/Draft Report):
DoD RESPONSE: Concur. The National Guard Financial Services Center is
working with each of the identified units and supporting USPFOs to
ensure all pay issues are resolved. The Army and DFAS will continue to
work the correction of any specific cases identified as still open for
these units. As noted by the GAO, many of the cases identified have
already been resolved or involved a delay in payment over 30 days from
entitlement rather than an actual unresolved discrepancy.
RECOMMENDATION 16: The GAO recommended that the Secretary of Defense
direct the Secretary of the Army, in conjunction with the Under
Secretary of Defense (Comptroller), to evaluate the feasibility of
using the personnel-to-pay interface as a means to proactively alert
pay personnel of actions needed to start entitled active duty pays and
allowances. (p. 77/Draft Report):
DoD RESPONSE: Concur. Within the next 6 months, we will evaluate the
feasibility of using the personnel-to-pay interface as a means to
proactively alert pay personnel of actions needed to start entitled
active duty pays and allowances.
RECOMMENDATION 17: The GAO recommended that the Secretary of Defense
direct the Director of the Defense Finance and Accounting Service, in
conjunction with the Under Secretary of Defense (Comptroller), to
evaluate the feasibility of automating some or all of the current
manual monthly pays, including special duty assignment pay, foreign
language proficiency pay, hardship duty pay and high altitude, low
opening jump pay. (p. 77/Draft Report):
DoD RESPONSE: Concur. Programming changes to DJMS-RC have been
implemented to enhance the processes for special duty assignment pay
and foreign language proficiency pay. However, monthly input is still
required. Hardship duty pay is scheduled for implementation for April
2004. High altitude, low opening jump pay requires manual computation
and input of a transaction for payment. The small volume of members
entitled to this pay has not justified nor provided an adequate return
on investment for this automation. DFAS has recognized the urgency of
improving the military pay system capabilities supporting our Service
members. A study was conducted of improvement alternatives in the fall
of 2002, which concluded that a new commercial off the shelf based
payroll capability ("Forward Compatible Payroll" (FCP)) was the best
option to expeditiously improve our system payroll services. FCP is
currently prototyping military entitlements and deductions and has
already demonstrated that DJMS RC's current monthly manual pays can be
automated rapidly in the new commercial off the shelf based
environment.
RECOMMENDATION 18: The GAO recommended that the Secretary of Defense
direct the Director of the Defense Finance and Accounting Service, in
conjunction with the Under Secretary of Defense (Comptroller), to
evaluate the feasibility of eliminating the use of the "other credits"
for processing Hardship Duty (Designated Areas); high altitude, low
opening jump pay; and special duty assignment pay, and instead
establishing a separate component of pay for each type of pay. (p. 77/
Draft Report):
DoD RESPONSE: Concur. Hardship duty pay is scheduled for automation in
April 2004. We will also recommend inclusion of automation of high
altitude, low opening jump pay in FCP. We acknowledge that the
information available to the member is inadequate in today's system.
This has already been addressed in the FCP requirements. Each pay is
designed to provide fully automated computation capability for active,
Reserve/Guard and detailed leave and earnings statement reporting to
the Service member through myPay. FCP will use legacy military pers/pay
data feeds to create a single military pay record for each Service
member supporting all Service component affiliations and duty statuses.
FCP will resolve pay systems capability related problems described in
this report. Until such time FCP has been implemented, we will ensure
that these certain pays paid under "other credits" are included in the
flyer addressed in response to recommendation 13. In addition, DFAS
will update the DFAS Reserve Component Mobilization Procedures to
mandate a remark be entered on the service member's leave and earnings
statement for pays paid under "other credits" to inform the service
member exactly what entitlement(s) they have paid.
RECOMMENDATION 19: The GAO recommended that the Secretary of Defense
direct the Secretary of the Army, in conjunction with the Under
Secretary of Defense (Comptroller), to evaluate the feasibility of
using the JUSTIS warning screen to help eliminate inadvertent omissions
of required monthly manual pay inputs. (p. 78/Draft Report):
DoD RESPONSE: Concur. The National Guard will develop a JUSTIS table
identifying all applicable soldiers in order to notify the USPFO
technician of accounts requiring monthly entitlement input. This will
be more efficient and effective than a pop-up warning screen, which
would appear only if the individual soldier's social security number
were input.
RECOMMENDATION 20: The GAO recommended that the Secretary of Defense
direct the Director of the Defense Finance and Accounting Service, in
conjunction with the Under Secretary of Defense (Comptroller), to
evaluate the feasibility of redesigning leave and earnings statement to
provide soldiers with a clear explanation of all pay and allowances
received so that they can readily determine if they received all and
only entitled pays. (p. 78/Draft Report):
DoD RESPONSE: Concur: We agree with the intent of this finding to
provide a full explanation to service members for changes occurring on
their leave and earnings statement. The DFAS is taking steps to improve
the readability and meaningfulness of notices and information on the
leave and earnings statement. Changes to the software used by the input
systems (Defense MilPay Office and JUSTIS) utilized by the Army, Army
National Guard, and DFAS, will require a remark be inserted on the
leave and earnings statement whenever a manual payment or debt is made.
Additionally, we will make every effort to better educate Service
members on understanding their leave and earnings statement by
reviewing and updating (as necessary) the information provided on our
website(s); by providing independent leave and earnings statement
remarks for present and future changes; continuing to provide the
USPFOs ands Reserve Component Pay Support Offices with monthly
newsletters; and effective immediately, provide the finance battalions/
Defense Military Pay Offices with the National Guard newsletter.
For the future, FCP is being designed with an easily understandable
leave and earnings statement as one of the main requirements. Each pay
is designed to provide fully automated computation capability for
active, Reserve/Guard and detailed leave and earnings statement
reporting through myPay. FCP will use legacy military pers/pay data
feeds to create a single military pay record for each Service member
supporting all Service component affiliations and duty statuses. FCP
will also resolve pay systems capability related problems described in
this report.
RECOMMENDATION 21: The GAO recommended that the Secretary of Defense
direct the Director of the Defense Finance and Accounting Service, in
conjunction with the Under Secretary of Defense (Comptroller), to
evaluate the feasibility of establishing an edit check and requiring
approval before processing any debt assessments above a specified
dollar amount. (p. 78/Draft Report):
DoD RESPONSE: Concur. The DFAS has already updated its current input
system (Defense MilPay Office) to provide a warning to field finance
personnel concerning the debt impact of tour cancellation (vice
modification) for Reserve/Guard members. DJMS-RC would require a small
to medium system change to edit debts that exceeded an established
threshold or required approval. Secondary manual processing would be
required to start the collection process or delete the debts.
RECOMMENDATION 22: The GAO recommended that the Secretary of Defense
direct the Director of the Defense Finance and Accounting Service, in
conjunction with the Under Secretary of Defense (Comptroller), as part
of the current effort underway to reform DoD's pay and personnel
systems-referred to as DIMHRS - incorporate a complete understanding of
the Army Guard pay problems as documented in this report into the
requirements development for this system. (p. 78/Draft Report):
DoD RESPONSE: Concur. The DFAS has provided detailed military pay
requirements input to the DIMHRS Program that support fully automated
computation of all military pay entitlements and deductions. The DIMHRS
system military pay requirements submitted by DFAS would resolve system
related pay problems as described in this report. DIMHRS is envisioned
to create a single military personnel/pay record for each Service
member supporting all Service component affiliations and duty statuses.
RECOMMENDATION 23: The GAO recommended that the Secretary of Defense
direct the Director of the Defense Finance and Accounting Service, in
conjunction with the Under Secretary of Defense (Comptroller), to
consider complete reengineering of the processes and controls and
ensure that this reengineering effort deals not only with the systems
aspect of the problems identified, but also with the human capital and
process aspects when developing DIMHRS. (p. 78/Draft Report):
DoD RESPONSE: Concur. The DFAS and Army have been actively involved in
recommending an improved operational military pers/pay concept in the
DIMHRS environment. Procedural changes are clearly required to
capitalize on the opportunities afforded by a modern fully integrated
personnel and pay system including improvements in process cycle time,
customer service, and accountability. The DFAS is working with the Army
DIMHRS Office to document existing workflow and roles and
responsibilities. The DIMHRS Program is still in the very early stages
of determining when and how integrated processes and workflows will be
incorporated into the DIMHRS based operational concept. The DIMHRS
"Joint Service Functional Concept of Operations," dated July 15, 2003,
page 14, indicates that the current plan is to "…initially mirror the
existing 'As-Is' structure until the new capability has been fielded
and risk factors/ requirements have been clearly identified. A
determination of what additional skills and expertise are required for
operators of a knowledge-based personnel community must be made after
the capabilities of the commercial off the shelf product are fully
known.":
[End of section]
Appendix IX: GAO Contacts and Staff Acknowledgments:
GAO Contacts:
Geoffrey B. Frank, (202) 512-9518 Sheila D. Miller, (303) 572-7378:
Acknowledgments:
Staff making key contributions to this report include: Paul S. Begnaud,
Ronald A. Bergman, James D. Berry, Jr., Amy C. Chang, Mary E.
Chervenic, Francine M. DelVecchio, C. Robert DeRoy, Dennis B. Fauber,
Jennifer L. Hall, Charles R. Hodge, Jason M. Kelly, Julia C. Matta,
Jonathan T. Meyer, John J. Ryan, Rebecca Shea, Crawford L. Thompson,
Jordan M. Tiger, Patrick S. Tobo, Raymond M. Wessmiller, and Jenniffer
F. Wilson.
(192080):
FOOTNOTES
[1] U.S. General Accounting Office, Financial Management: Defense's
System for Army Military Payroll Is Unreliable, GAO/AIMD-93-32
(Washington, D.C.: Sept. 30, 1993).
[2] As a result of the lack of supporting documents, we likely did not
identify all of the pay problems related to the active duty
mobilizations of our case study units. However, for the pay problems we
identified, we defined over-and underpayments as those pays or
allowances for mobilized Army Guard soldiers during the period from
October 1, 2001, through March 31, 2003, that were in excess of
(overpayment) or less than (underpayment) the entitled payment. We
considered as late payments any active duty pays or allowances paid to
the soldier over 30 days after the date on which the soldier was
entitled to receive such pays or allowances. As such, these payments
were those that, although late, addressed a previously unpaid
entitlement. In addition, we used available data to identify about
$135,000 in collections against identified overpayments through March
31, 2003. We did not attempt to estimate payments received against
identified underpayments. In addition, we did not include any erroneous
debts associated with these payments as pay problems. We have provided
documentation for the pay problems we identified to cognizant DOD
officials for further research to determine whether additional amounts
are owed to the government or the soldier.
[3] Reserve components include the Army National Guard, Army Reserves,
Air National Guard, Air Force Reserves, Naval Reserves, Marine Corps
Reserves, and Coast Guard Reserves.
[4] The law makes a distinction between the terms "pays" and
"allowances" which together make up a service member's overall
compensation package. Generally, the term pay includes basic pay,
special pay, retainer pay, incentive pay, retired pay, and equivalent
pay, but does not include allowances. 37 U.S.C. Section 101(21). DOD
defines an allowance as "a monetary amount paid to an individual in
lieu of furnished quarters, subsistence, or the like." Department of
Defense Financial Management Regulation, vol. 7A, Definitions, para. 15
(February 2001). While generally items considered as "pay" are taxable
for federal income tax purposes, except for the cost of living
allowance for the continental United States, most allowances, such as
those for housing, subsistence, and family separation, are not.
[5] There is no limit on the military pay exemption for enlisted Army
Guard members, but there is an annual limit of about $70,000 for
officers.
[6] In November 1988, the Under Secretary of the Army approved the use
of the Air Force military pay system to pay the Army active and reserve
component soldiers (including Army Guard soldiers).
[7] We identified about $135,000 in collections against these
overpayments.
[8] GAO/AIMD-93-32. As discussed in that report, at that time, Army
Guard soldiers mobilized to active duty were paid using the Army active
duty pay system. In addition, as discussed in our April 1994 testimony,
(U.S. General Accounting Office, Financial Management: Financial
Control and System Weaknesses Continue to Waste DOD Resources and
Undermine Operations, GAO/T-AIMD/NSIAD-94-154, Washington, D.C.: Apr.
12, 1994), further investigation of the improper payroll payments
identified in our 1993 report revealed instances of fraudulent payments
to "ghost soldiers."
[9] May 9, 2002, memorandum on the results of an April 15-19, 2002,
National Guard Bureau operational review of Colorado's USPFO.
[10] Pub. L. No. 105-85, Div. A, Title VI, Subtitle A, Section 603, 111
Stat. 1629, 1775 (1997).
[11] Id. at Section 619, 111 Stat. 1629, 1789.
[12] The remaining 18 respondents were either as satisfied as not or
had no basis to judge.
[13] The 11 remaining respondents were either as satisfied as not or
had no basis to judge.
[14] U.S. Department of Defense, Report to Congress: Defense Integrated
Military Human Resource System (Personnel and Pay), (Washington, D.C.
June 2002).
[15] See, for example, U.S. General Accounting Office, DOD Business
Systems Modernization: Continued Investment in Key Accounting Systems
Needs to Be Justified, GAO-03-465 (Washington, D.C.: Mar. 28, 2003).
[16] U.S. Department of Defense, Financial Management Regulation (FMR),
vol. 7A, ch. 24.
[17] DOD FMR, vol. 7A, ch. 24.
[18] DOD FMR, vol. 7A, ch. 8.
[19] Our audit findings were consistent with those of the sergeant.
[20] A sergeant who was tracking pay-related issues in addition to his
mission-related duties as an engineer prepared the roster. He could not
make the trip to initiate the location-based pays because he received
another mission-related assignment that superseded his administrative
tasks.
[21] In DJMS-RC, the hardship duty (certain places) payment is
identified as a separate component of pay, while designated areas
payments require using a miscellaneous component of pay.
[22] The National Guard Bureau's Financial Services Center provides
monthly computerized matches between common military pay-related-data
in DJMS-RC and the SIDPERS personnel system. The purpose of this after-
the-fact detective internal control is to ensure the propriety and
accuracy of military pay and entitlements to authorized recipients. The
monthly products that are provided to each state USPFO are commonly
called mismatch reports.
[23] In early November 2001, soldiers from the unit were moved off base
to live in local hotels because Fort Stewart could not accommodate the
large number of soldiers arriving to mobilize.
[24] U.S. General Accounting Office, Standards for Internal Control in
Federal Government, GAO/AIMD-00-21.3.1 (Washington D.C.: November
1999). These standards provide the overall framework for establishing
and maintaining effective internal control and for identifying and
addressing areas of greatest risk of fraud, waste, abuse, and
mismanagement.
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