Military Operations: Actions Needed to Better Guide Project Selection for Commander's Emergency Response Program and Improve Oversight in Iraq

GAO-08-736R Published: Jun 23, 2008. Publicly Released: Jun 23, 2008.
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Since fiscal year 2003, Congress has appropriated more than $46 billion dollars for relief and reconstruction efforts in Iraq. The Department of Defense (DOD) is one of several U.S. agencies that administer U.S.-funded relief and reconstruction programs in Iraq. In particular, DOD manages the Commander's Emergency Response Program (CERP), which is designed to enable local commanders in Iraq and Afghanistan to respond to urgent humanitarian relief and reconstruction requirements within their areas of responsibility by carrying out programs that will immediately assist the indigenous population. Thus far, Congress has appropriated more than $3 billion for CERP in Iraq and Afghanistan. Since the program's inception, DOD has steadily increased its funding requests in response to theater conditions, and reported obligations have also grown substantially. DOD's funding requests have increased by more than a billion dollars from fiscal years 2004 through 2008. For fiscal year 2008, DOD requested $1.2 billion to fund CERP projects in Iraq and Afghanistan and plans to request an additional $507 million, primarily for CERP in Iraq. Furthermore, DOD's reported obligations for Iraq and Afghanistan have grown from about $179 million in fiscal year 2004 to more than $1.1 billion in fiscal year 2007. In addition, over the same period of time, the number of projects in both countries has grown from about 6,450 to about 8,700. According to DOD regulations, CERP is intended for small-scale, urgent humanitarian relief and reconstruction projects for the benefit of Iraqi people. The guidance issued by the Undersecretary of Defense (Comptroller) establishes 19 authorized uses for CERP funds, including transportation, electricity, and condolence payments. CERP funds can be used for both construction and non-construction projects. In Iraq, commanders follow Multinational Corps-Iraq (MNC-I) standard operating procedures for CERP, which expand upon DOD regulations. MNC-I guidance states that the keys to project selection are to (1) execute quickly, (2) employ many Iraqis, (3) benefit the Iraqi people, and (4) be highly visible. DOD regulations identify the roles and responsibilities that different offices play in managing CERP. The Secretary of the Army serves as the executive agent and is responsible for ensuring that commanders carry out CERP in a manner that is consistent with applicable laws, regulations and guidance. The Commander of U.S. Central Command (CENTCOM) is responsible for allocating CERP resources. Public Law No. 108-106 and subsequent laws require DOD to provide Congress with quarterly reports on the source, allocation, and use of CERP funds. The reports are compiled based on information about the projects that was entered by unit officials into the Iraq Reconstruction Management System, a database that tracks projects' status and maintains a historical record of all reconstruction activity in Iraq, including those projects funded by CERP. Because of significant congressional interest, we conducted this work under the authority of the Comptroller General to undertake work at his own initiative and examined the following questions regarding the CERP program in Iraq: (1) To what extent does DOD guidance establish selection criteria for CERP projects? (2) To what extent do commanders in Iraq coordinate CERP with other U. S. government agencies and with the government of Iraq? and (3) To what extent do DOD and MNC-I exercise oversight of CERP projects in Iraq?

DOD has established broad selection criteria for CERP projects, which gives significant discretion to commanders in determining the types of projects to undertake. CERP is intended to provide commanders a source of funds that allow them to respond to urgent, small-scale humanitarian relief and reconstruction needs that will immediately assist the local Iraqi population. However, DOD guidance provides no definition for small-scale or urgent, which leaves commanders with the responsibility of developing their own definitions. Commanders we interviewed had varying definitions for small-scale. Our review of the quarterly reports to Congress demonstrated the wide spectrum in size and costs of projects. For instance, projects ranged from a waterline repair costing slightly more than $100 to an electrical distribution system costing more than $11 million. In addition, during our visit to Iraq, we observed three projects: a multimillion-dollar sewage lift station, a several hundred thousand dollar sports center and community complex, and a fruit and vegetable stand that had been renovated with a $2,500 grant. Commanders typically defined urgent as restoring a basic human need, such as water and electricity, or projects identified by the local Iraqi government as its most pressing requirement for the area. As a result, the scale, complexity, and duration of projects selected vary across commands. While the majority of CERP projects have cost less than $500,000, the number of projects costing more than $500,000 has increased significantly. According to DOD officials, factors contributing to the increasing number of CERP projects costing more than $500,000 include the lack of other available reconstruction money, improved security in the region and the fact that many of the immediate needs of the Iraq people were addressed during the initial phases of CERP. Commanders reported that they generally coordinated projects with the appropriate U.S. and Iraqi officials, as required by guidance. The officials include Iraqi government personnel as well as military and nonmilitary U.S. officials. MNC-I guidance further states that coordination with local officials is critical to ensure that a project meets a need and will be maintained and that numerous projects have been built that did not meet their intended purpose because of lack of coordination. MNC-I guidance notes that coordination efforts may include synchronizing CERP projects with complementary programs funded by United States Agency for International Development or other nongovernmental organizations within the commander's area of responsibility. While the MNC-I project approval process provides some oversight, the Offices of the Under Secretary of Defense (Comptroller), the Army and MNC-I have limited oversight of CERP in Iraq because they (1) do not require units executing projects to monitor them, (2) have not established performance metrics, and (3) have limited knowledge of projects under $500,000. Neither DOD nor MNC-I guidance establishes a requirement for units executing projects to monitor them. MNC-I guidance has a broad requirement for the MNC-I engineer to monitor reconstruction projects, but does not include a requirement for units executing projects to monitor them. No performance metrics exist for CERP. As we have previously reported, federal agencies should develop plans that establish objective, quantifiable, and measurable performance goals that should be achieved by a program. Although MNC-I officials have some visibility over projects costing more than $500,000 because they approve these projects, they have limited visibility and oversight for projects costing less than $500,000. The quarterly reports do not provide information about the number of projects completed during a quarter, the number of projects that have been started but not completed, or the number of projects that have not been sustained or maintained by the Iraqi government or the local population.

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Recommendations for Executive Action

Agency Affected Recommendation Status
Department of Defense As DOD continues to request funding for CERP projects in Iraq, it is important that DOD and commanders at all levels have the information needed to determine whether projects are meeting the intent of the program, assess program outcomes, and be better informed about their funding requests. Therefore, to improve the program and management, the Secretary of Defense should direct the Under Secretary of Defense (Comptroller) to revise DOD's CERP guidance to include (1) definitions of small-scale and urgent and (2) a requirement that units that execute CERP projects provide project monitoring to ensure that contractors have met the contract specifications.
Closed – Implemented
(1) DOD addressed our recommendation in its June 2008 revised Commander's Emergency Response Program (CERP) guidance. Specifically, in its revised policy, DOD states that small-scale would generally be considered projects that cost less than $500,000 and urgent as any chronic or acute inadequacy of an essential good or service which, in the judgement of a local commander, calls for immediate action. Implementation of this recommendation should help DOD determine if the projects chosen by commanders are consistent with DOD's intent for the program. (2) DOD revised it guidance in response to our recommendation. DOD's June 2008 guidance states that all projects must have progress monitored to ensure that payments are commensurate with the work accomplished and the engineering standards as stipulated. For projects costing less than $500,000, assistance can be requested from either the organic engineer or another unit's engineer to assist in determining construction progress. By conducting project monitoring, DOD officials will have the opportunity to gather information that could be useful in assessing future uses of CERP funds and determine if funds are being used in a fiscally responsible manner.
Department of Defense The Secretary of Defense should direct Undersecretary of Defense (Comptroller) in conjunction with others to develop performance measures or indicators for CERP and use these indicators as well as other information to evaluate project effectiveness and sustainability as well as the program's budget requests.
Closed – Implemented
In response to our recommendation, DOD revised its guidance to require performance indicators be included in evaluation packages for proposed Commander's Emergency Response Program (CERP) projects and used as part of the close-out process for evaluating the project at its completion. The guidance identifies six areas that should be considered for evaluating proposed projects which include immediate benefit to the local population and the sustainability of projects, both of which were suggested by our report. By requiring performance metrics for projects, CERP projects can be assessed in a consistent manner and Multinational Corps Iraq and DOD officials may have access to information that will be useful in evaluating and validating commander's request for CERP funds.
Joint Chiefs of Staff The Chairman of the Joint Chiefs of Staff should direct the Commander of CENTCOM to direct the Commander of the Multi-Naitonal Force-Iraq to take steps to gain greater visibility of projects costing less than $500,000, such as obtaining and reviewing summary information on the status of projects, completion rates, and impact of projects on the community.
Closed – Implemented
DOD updated its Commander's Emergency Response Program (CERP) guidance to reflect that commanders in Multinational Corps-Iraq (MNC-I) ensure that proper procedures are in published guidance in theater to evaluate CERP projects and ensure that projects meet the intent of the program. In addition, the guidance requires the MNC-I commander to prepare a Commander's Narrative for each quarterly report of commander's intent for CERP funds by geographic sector including performance measures for ongoing and proposed projects. By implementing this recommendation, MNC-I officials will have a basis for evaluating commander's funding requests and assessing the effective and efficient usage of CERP resources in meeting the program's intent.

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