Procurement of Depleted Uranium Penetrators for the Air Force

PSAD-79-88: Published: Jun 13, 1979. Publicly Released: Jun 13, 1979.

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A study on using the Feed Materials Production Center, Fernald, Ohio, as a potential producer of depleted uranium penetrators for the Air Force was reviewed to determine the possible government savings of the production.

The study shows that several million dollars can be saved by combining production of Department of Energy (DOE) items with production of the Air Force penetrators at the Fernald facility. These savings are possible because the production of the penetrators can be integrated with current DOE production without proportionate increases in overhead and labor costs, and with no increase in the contractor's fee. The savings could be even greater if the Department of the Army also obtained its penetrators from the Fernald facility. However, the Air Force recommends that the penetrators continue to be purchased from the private sector, contending that the National Lead prices would be higher than those of commercial competitors if full-cost reimbursement were required. The position of DOE for charging the Air Force the full cost is based on its not wishing to be a party to unfair competition with private industry. In the opinion of GAO, the penetrators should be produced at the Fernald facility at reduced costs to the government, and be made available for purchase by the Department of the Army. Furthermore, DOE is not restricted to charging only out-of-pocket costs if it can demonstrate some recognizable goal or policy which supports a greater recovery.

Recommendation for Executive Action

  1. Status: Closed

    Comments: Please call 202/512-6100 for additional information.

    Recommendation: The Secretary of Energy should reconsider the rationale for charging the Air Force the full cost for producing the penetrators. The Director of the Office of Management and Budget should review the matter with the Secretary of Energy and the Secretaries of the Air Force and Army, and arrange to produce the penetrators at the Fernald facility.

    Agency Affected:

 

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