AV-8B Program:

Aircraft Sales to Foreign Government to Fund Radar Procurement

NSIAD-93-24: Published: Oct 23, 1992. Publicly Released: Oct 23, 1992.

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Pursuant to a legislative requirement, GAO discussed the methods the Navy used to fund the addition of radar to its AV-8B aircraft.

GAO found that the Navy: (1) purchased no additional aircraft as replacements for the two TAV-8B aircraft and three AV-8B aircraft that it sold to Italy; (2) used the sale proceeds from the TAV-8B aircraft to finance its acquisition of radar for AV-8B aircraft; (3) repeatedly missed scheduled funding dates but did not violate the Anti-Deficiency Act; and (4) requested appropriations for 24 aircraft, even though it had long planned to sell 3 of the aircraft and use those funds to buy radar.

Matters for Congressional Consideration

  1. Status: Closed - Not Implemented

    Comments: The authorization and appropriation committees have not taken action on this recommendation.

    Matter: To provide better oversight on program funding, Congress may wish to consider amending its agreements with the Department of Defense on reprogramming to add the requirement that any decrease in the procurement quantity of a weapon system for which funds are authorized receive prior congressional approval if the quantity decrease is the result of a foreign military sale.

  2. Status: Closed - Implemented

    Comments: The Senate Armed Services Committee report accompanying the FY 1993 DOD authorization bill stated that if the Navy continued to make below-threshold reprogrammings to the AV-8B program, the Committee would recommend that Congress codify much tighter limitations on DOD ability to use below-threshold reprogramming. The committees concluded that additional action was not needed.

    Matter: To provide better oversight on program funding, Congress may wish to consider amending its agreements with the Department of Defense on reprogramming to ensure that reprogramming thresholds apply to cumulative increases for specific programs during a fiscal year, as well as individual funding lines within the programs.

Recommendations for Executive Action

  1. Status: Closed - Not Implemented

    Comments: DOD claims that the sale of the two TAV-8B to Italy was based on the laws and regulations governing replacement-in-kind transactions.

    Recommendation: The Secretary of Defense should direct that an amount equal to the proceeds from the sale of the two TAV-8B aircraft to Italy, $44.44 million, be deposited in the Special Defense Acquisition Fund or, if the fund is at its statutory ceiling, in the Treasury as miscellaneous receipts.

    Agency Affected: Department of Defense

  2. Status: Closed - Implemented

    Comments: In formal comments on the GAO report, DOD stated that if a TAV-8B was sold to Spain from stocks, the proceeds would be used to procure a replacement aircraft (in addition to those currently appropriated and under contract) or they would be deposited in the Treasury as miscellaneous receipts. Since then, the Navy has reported that Spain no longer requires an additional TAV-8B.

    Recommendation: The Secretary of Defense should direct that if the sale from stock of a TAV-8B to Spain occurs, and if the Navy intends to replace the aircraft, an additional TAV-8B or AV-8B be either added to a current contract or included in a new procurement contract. If the Navy does not intend to replace the TAV-8B, the sale proceeds should be deposited in the Special Defense Acquisition Fund or, if that account is at the statutory ceiling, in the Treasury as miscellaneous receipts.

    Agency Affected: Department of Defense

 

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