DOD's Incremental Costs and Funding for Fiscal Year 1994
NSIAD-95-119BR: Published: Apr 18, 1995. Publicly Released: May 18, 1995.
- Full Report:
Pursuant to a congressional request, GAO provided information on the incremental costs of the Department of Defense's (DOD) participation in peace operations during fiscal year (FY) 1994, focusing on: (1) whether supplemental appropriations fully covered DOD's incremental costs; (2) the impacts on the services from funding shortages and overages; and (3) how DOD spent the reimbursements received from the United Nations.
GAO found that: (1) during FY 1994, DOD reported $1,907.8 million in incremental costs for peace operations; (2) as a means to reimburse DOD for some of these costs, Congress provided DOD with emergency supplemental appropriations in February 1994; (3) the supplemental appropriations covered almost two-thirds of these incremental costs, leaving DOD with a funding shortfall of $709.5 million near the end of FY 1994; (4) DOD covered $233.3 million of this shortfall by invoking its Feed and Forage Act authority, using funds from the FY 1994 balance in the Defense Emergency Response Fund (DERF) account, and using authorized reprogramming funds; (5) DOD absorbed the remaining $476.2 million primarily by reducing operation and maintenance (O&M) funding for such activities as military training, equipment maintenance, and stock purchases; (6) on September 30, 1994, the FY 1995 defense appropriations act provided additional supplemental appropriations of $299.3 million through the DERF to further reimburse DOD for certain operations that occurred in FY 1994; (7) while this funding was technically appropriated within FY 1994, most of it was not obligated during that year; (8) including this second supplemental in a final accounting for incremental peace operations in FY 1994, DOD sustained a funding shortfall of $176.9 million; (9) units participating in peace operations were fully funded for their incremental costs; (10) to pay these units' costs, DOD used funds from other service programs or units that did not participate; (11) except for the Air Force, service officials told GAO that reductions in O&M accounts to cover peace operation incremental costs adversely affected military readiness at several units; (12) while participating units were not affected by funding shortages, as a result of their deployment to peace operations, they experienced operational impacts such as missed training opportunities; (13) unrelated to the supplemental appropriations, in FY 1994, DOD received $98.1 million in reimbursements from the United Nations for assistance provided to the U.N. operation in Somalia during FY 1993; (14) the majority of this amount was paid on March 29, 1994; and (15) the funds were deposited to FY 1994 appropriation accounts and, according to DOD, cannot be traced to specific expenditures.