Comments on H.R. 4685

B-205197: Published: Dec 9, 1981. Publicly Released: Dec 9, 1981.

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GAO was asked to comment on H.R. 4685, which requires the enactment of special legislation to continue funding major civil acquisitions whenever actual costs or expected projected costs increase by 25 percent or more, excluding inflation. GAO is to determine the cost growth statistics and to report all such cost growth to Congress and to the head of the agency concerned. Status information would be a useful management tool to assess overall program progress and would aid in program planning. The rapidly escalating costs of Government projects and budget restraints intensify interest in the oversight and management of acquisitions. Hence, it is essential that accurate and informative data be provided to Congress on the cost and the status of major civil acquisitions. In addition to the cost data, the following types of data should be considered for incorporation into the bill's reporting requirements: (1) original estimated cost per initial congressional budget authorization or appropriation justification; (2) cumulative funds authorized, appropriated, and obligated through the end of the reporting period; (3) currently planned or actual project completion as of the end of the reporting period in relation to the originally planned completion date; (4) reasons for slippage of scheduled completion date in excess of 6 months; (5) currently planned quantity or size in relation to that originally planned; and (6) reasons for quantity or size changes. The Office of Management and Budget (OMB) should define the data to be reported and should establish uniform terms and reporting procedures. Agencies should report the data to OMB for analysis and compilation for subsequent reporting to Congress. OMB should notify the agencies and Congress of cost overruns requiring action. While inflation should be excluded from determining cost growth, it should be reported and included in cost estimates, and a uniform method for treatment of inflation should be developed. Status data relating to funding, scheduling, and quantity or size should be reported in addition to cost data. Projects should be described in relation to performance and mission data. The restriction on additional obligations or exenditures of funds should contain an exception which would allow payments in situations where the Government is legally bound at the time when this restriction becomes applicable. Projects qualifying under the dollar threshold, at the time of the bill's enactment, should be reported.

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