Environmental Liabilities:

DOD Training Range Cleanup Cost Estimates Are Likely Understated

GAO-01-479: Published: Apr 11, 2001. Publicly Released: Apr 11, 2001.

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Because of concerns about the long-term budgetary implications associated with the environmental cleanup of the Department of Defense (DOD) training ranges, GAO examined (1) the potential magnitude of the cost to clean up these ranges in compliance with applicable laws and regulations, (2) the scope and reliability of DOD's training range inventory, and (3) the methodologies used to develop cost estimates. GAO found that DOD lacks complete and accurate data with which to estimate training range cleanup costs. DOD has not done a complete inventory of its ranges to fully identify the types and extent of unexploded ordnance present and the associated contamination. Recently, DOD began to compile training range data, but these initial efforts have been delayed because DOD did not issue formal guidance to the services for collecting the information until October 2000. Because DOD has not completed an inventory of its ranges, the services have used varying methods to estimate the size and condition of the ranges necessary to estimate the cost of cleanup for financial statement purposes. As a result, environmental liability costs are not consistently calculated and reported across the services.

Recommendations for Executive Action

  1. Status: Closed - Implemented

    Comments: In July 2001, the cost model, the Remedial Action Cost Engineering and Requirements (RACER), used to compute training range cleanup costs was validated in accordance with DOD Instruction 5000.61.

    Recommendation: The Secretary of Defense should require that the designated focal point validate the cost model in accordance with DOD Instruction 5000.61.

    Agency Affected: Department of Defense

  2. Status: Closed - Implemented

    Comments: In July 2001, DOD validated the RACER cost model for estimating costs at cleanup sites, and in January 2002, DOD issued guidance to the services that required them to use the validated methodology for estimating training cleanup costs to be reported in financial statements and other reports.

    Recommendation: The Secretary of Defense should require the designated focal point to work with the appropriate DOD organizations to develop and implement a consistent and standardized methodology for estimating training range cleanup costs to be used in reporting its training range cleanup liabilities in DOD's agency-wide annual financial statements and other reports as required.

    Agency Affected: Department of Defense

  3. Status: Closed - Implemented

    Comments: DOD developed guidance to inventory all types of training ranges. This guidance was established under DOD Directive 3200.15 issued by the Deputy Secretary of Defense in January 2003, and the Management Guidance for the Defense Environmental Restoration Program, issued by the Office of the Deputy Under Secretary of Defense (Installation and Environment) in September 2001. DOD's guidance also includes requirements to address (1) key site characterization, (2) other constituent contamination in the soil and/or water, (3) performance time frames, and (4) necessary policies and procedures for the management and maintenance of the inventory information.

    Recommendation: The Secretary of Defense should require the designated focal point to work with the appropriate DOD organizations to develop and implement guidance for inventorying all types of training ranges, including active, inactive, closed, transferred, and transferring training ranges. This guidance, at a minimum, should include (1) key site characterization information for training ranges be collected for unexploded ordnance removal, (2) identification of other constituent contamination in the soil and/or water, (3) performance time frames, including the requirements to perform the necessary site visits to confirm the type and extent of contamination, and (4) the necessary policies and procedures for the management and maintenance of the inventory information.

    Agency Affected: Department of Defense

  4. Status: Closed - Implemented

    Comments: On March 29, 2001, in response to GAO's recommendation, the Principal Deputy Under Secretary of Defense stated that until the Secretary of Defense had his permanent team in place, the Acting Assistant Deputy Under Secretary of Defense for Environment would serve as the focal point to oversee and manage the reporting of training range liabilities. In January 2002, the Assistant Deputy Under Secretary of Defense for Environment was designated as the focal point for overseeing and managing the reporting of training range liabilities.

    Recommendation: The Secretary of Defense should designate a focal point with the appropriate authority to oversee and manage the reporting of training range liabilities.

    Agency Affected: Department of Defense

  5. Status: Closed - Implemented

    Comments: DOD revised Volume 6B, Chapter 10, of the DOD Financial Management Regulation (FMR) in January 2002, to clarify instances when a liability should be recognized for an active or inactive range. This revision of the DOD FMR addresses the recognition of an environmental liability at active and inactive ranges in accordance with the criteria of federal accounting standards.

    Recommendation: The Secretary of Defense should require the DOD Comptroller to revise the DOD Financial Management Regulation to include guidance for recognizing and reporting a liability in the financial statements for cleanup costs on active and inactive ranges when such costs meet the criteria for a liability found in the federal accounting standards.

    Agency Affected: Department of Defense

 

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