[Assessment of Army's Multiple Launch Rocket System Multiyear Contract]

In connection with a congressional request to assess the Army's ongoing Multiple Launch Rocket System 5-year contract, GAO considered the legality of the Army's exercise of two options for the advance procurement of items in two later contract years which the government had not committed itself to procure. GAO held that, since Congress did not authorize the action, procurement for the items violated the prohibition against unauthorized expenditure of government funds. The Army's contention that the items were needed under the bona fide statute was not applicable. Further, the Army incorrectly relied on the fact that cognizant congressional committees were aware of the eventual purchases. Accordingly, exercise of the first option was unauthorized. However, since the Army had already completed work under the first option, GAO recommended that the Army refrain from any unauthorized work under the second option.