Funding for GWOT in Fiscal Years 2004 and 2005 Was Provided in Annual and Supplemental Appropriations

In fiscal years 2004 and 2005, the military services received about  $52.4 billion and about $62.1 billion, respectively, in supplemental  appropriations for GWOT military personnel and operation and  maintenance expenses. DOD  described these funds as being intended to support GWOT. As shown in table 2, in fiscal years 2004 and 2005, the Army, Air Force, and  Navy received additional funds in their annual appropriations—a total of  about $7.9 billion in fiscal year 2004 and about $7.6 billion in fiscal year  2005—which DOD described as for support of military operations in the  war on terrorism. For military personnel, the Navy and Marine Corps  reported more in obligations than they received in supplemental  appropriations, while for operation and maintenance each of the military  services reported more in obligations than it received in supplemental  appropriations. Variety of Actions Were Taken to Cover the Military Services’ GWOT Gaps in Fiscal Year 2004

To cover the military services’ gaps between reported fiscal year 2004  obligations and supplemental appropriations, the Office of the Under  Secretary of Defense (Comptroller) and the military services used a  number of authorities provided to them, including transferring funds and  reducing or deferring planned spending for peacetime operations. However, DOD did not explicitly take  into account the funds provided through its annual appropriations that it  intended for support of GWOT. As discussed earlier, since DOD’s  accounting systems do not separately identify the portion of the  department’s annual appropriations that were described as having been  requested to support GWOT and there are no reporting requirements for  DOD to identify to which appropriation accounts the funds were allocated,  the military services have lost visibility over these funds and do not know  the extent to which they are being used to support GWOT. DOD Did Not Explicitly Account for Funds Provided through Its Annual Appropriation That It Described as for GWOT When Determining How to Cover Its Fiscal Year 2004 Gaps

In determining how to cover the gaps between the services’ supplemental  appropriations and reported GWOT obligations for military personnel and  operation and maintenance expenses, DOD did not explicitly take into  account the almost $7.9 billion in funds the Army, Air Force, and Navy  received in their annual appropriations through Program Budget Decision  736 to help fund GWOT. Fiscal Year 2005 Reported Obligations for GWOT Could Exceed Supplemental Appropriations, Requiring the Military Services to Use Authorities Provided to Them to Cover the Differences

Our analysis of the military services’ reported obligations for the first 8  months of fiscal year 2005 and the military services’ forecasts as of June  2005 of full fiscal year 2005 costs suggest the services’ military personnel  and operation and maintenance GWOT obligations could exceed available  supplemental appropriations for the war in some accounts. The services’  more detailed forecasts suggest a gap for military personnel expenses for  the Air Force of about $500 million, and gaps for operation and  maintenance expenses for the Army and Air Force of about $2.7 billion and  about $1 billion, respectively. To cover any  gaps and meet its GWOT needs, DOD and the services plan to take a variety  of actions, including reprogramming funds from annual appropriations and  reducing or deferring planned spending for peacetime operations. If counted in fiscal year 2005, the amounts  potentially could reduce the need for reprogrammings from other activities  and could reduce the Army’s and eliminate the Air Force’s GWOT gaps. The military services absorbed the  increase into their annual appropriations and allocated it based on their  judgment of where the funds were most needed. Consequently, despite having asked for  the increase, DOD is not explicitly counting the more than $10 billion when  considering funding for GWOT. In addition, DOD commented that the  report’s focus on the Program Budget Decision results in the inaccurate  conclusion that if DOD had considered these funds it could have reduced  the Army’s GWOT gap and eliminated the GWOT gaps of the Air Force and  Navy. Therefore, we are unable to ensure that DOD’s reported obligations  for GWOT are complete, reliable, and accurate.
Why GAO Did This Study

To assist the Congress in its oversight role, GAO is undertaking a series of reviews on the costs of operations in support of the Global War on Terrorism (GWOT). In related work, GAO is raising concerns about the reliability of the Department of Defense's (DOD) reported cost data and therefore is unable to ensure that DOD's reported obligations for GWOT are complete, reliable, and accurate. In this report, GAO (1) identified funding for GWOT in fiscal years 2004 and 2005, (2) compared supplemental appropriations for GWOT in fiscal year 2004 to the military services' reported obligations, and (3) compared supplemental appropriations for GWOT in fiscal year 2005 to the military services' projected obligations.

What GAO Found

In fiscal years 2004 and 2005, DOD received funding for GWOT through both funds included in its annual appropriation and supplemental appropriations. In fiscal years 2004 and 2005, the military services received about $52.4 billion and $62.1 billion, respectively, in supplemental appropriations for GWOT (1) military personnel and (2) operation and maintenance expenses. The Army, Air Force, and Navy also received in their annual appropriations a combined $7.9 billion in fiscal year 2004 and a combined $7.6 billion in fiscal year 2005, which DOD described as being intended to support GWOT. The military services absorbed the increase into their annual appropriations and allocated it based on their judgment of where the funds were most needed. DOD's accounting systems, however, do not separately identify these additional appropriations, and there are no reporting requirements for DOD to identify to which appropriation accounts the funds were allocated; consequently, the military services have lost visibility over these funds and do not know the extent to which they are being used to support GWOT. Despite having asked for the increase to support GWOT, DOD is not explicitly counting these additional funds when considering the amount of funding available to cover GWOT expenses. For fiscal year 2004, regarding supplemental appropriations for GWOT military personnel expenses, the Navy and Marine Corps reported more in obligations than they received in supplemental appropriations, while the Army and Air Force received more in supplemental appropriations than their reported obligations. Each of the services reported more in GWOT operation and maintenance obligations than it received in supplemental appropriations. To cover the differences (gaps), DOD and the services exercised a number of authorities provided them, including transferring funds and reducing or deferring planned spending for peacetime operations. However, in considering the amount of funding available to cover the gaps, DOD did not explicitly take into account the funds provided through its annual appropriation that as previously noted it described as for the support of GWOT. If DOD had considered these funds, it could have reduced the Army's GWOT gap and eliminated the GWOT gaps of the Air Force and Navy. For fiscal year 2005, the services' forecasts of GWOT obligations for the full fiscal year as of June 2005 suggest a potential gap of $500 million for military personnel for the Air Force and potential gaps of about $2.7 billion and about $1 billion, respectively, for operation and maintenance for the Army and Air Force. To cover expenses, DOD and the services again plan to take a variety of actions, including reprogramming funds and reducing or deferring planned spending. However, DOD is again not explicitly considering the funds provided through its annual appropriation, which it described as for the support of GWOT. If counted in fiscal year 2005, the amounts potentially could reduce the Army's and eliminate the Air Force's GWOT gaps and eliminate the need for reprogramming funds and reducing or deferring planned spending.