Comments on Propriety of DOD Proposal To Proceed with Navy Shipbuilding Program in Spite of Predicted Funding Deficits

Pursuant to a congressional request, GAO reviewed the propriety and legality of a proposal by the Department of Defense to proceed with Navy shipbuilding programs in spite of predicted funding deficits. GAO held that the proposal was subject to legal objection only if, and to the extent that, procurement actions initiated during fiscal year 1975 involved costs exceeding funds available at that time. Since sufficient funds were available to cover termination costs if that had become necessary, GAO did not object to the proposal's implementation.