	DOD Does Not Anticipate Future Budget or Force Structure Changes and 2013 Report to Congress Provides Results of Previous Analyses We Reported on in February 2013

In its April 2013 report to Congress, in response to the National Defense  Authorization Act for Fiscal Year 2013 requirement that DOD provide a  cost-benefit analysis and a risk-based assessment of the Aerospace  Control Alert mission as it relates to expected future changes to the  budget and force structure of such mission,report on any new analyses because, according to DOD officials, DOD  was not weighing competing Aerospace Control Alert basing location  alternatives in response to any future budget or force structure changes. DOD reported on its previous analyses that consisted of (1) three risk  assessments DOD conducted to support the 2012 decision that  determined which two alert basing locations could be reduced with the  least amount of risk and (2) cost savings estimates DOD developed after  making the 2012 decision to take two alert basing locations (one in  Duluth, Minnesota, and the other in Langley, Virginia) off 24-hour alert  status. Following a decision by DOD that two alert basing locations should be taken off 24- hour alert status, three risk assessments were conducted to support the  2012 decision of which two locations, once removed from 24-hour alert  status, would have the least amount of increase in risk to the overall  Aerospace Control Alert mission. DOD’s April 2013 report provided a  summary of the final results of these three risk assessments. These risk  assessments were performed by NORAD, the Office of the Secretary of  Defense Office of Cost Assessment and Program Evaluation, and the  Continental U.S. NORAD Region, which included consideration of threat,  vulnerability, and consequence. According to DOD officials, DOD does not expect to make future changes  to the budget and force structure of the mission beyond the decision  already made to remove two sites from 24-hour alert status. DOD Has Not Reported Comprehensive Cost Information for the Aerospace Control Alert Mission

DOD has reported Air Force cost information for the Aerospace Control  Alert mission in its budget displays but has not yet reported the  comprehensive cost of the mission. Standards for Internal Control in the  Federal Government notes that financial information is needed for  periodic external reporting and, on a day-to-day basis, to make operating  decisions, monitor performance, and allocate resources. The Air Force  budget justification displays submitted for fiscal years 2010-14 include  personnel costs for Air Force, Air National Guard, and Air Force Reserve  personnel, but do not include costs, such as military personnel costs, that  other military services have in conjunction with the Aerospace Control  Alert mission. In addition to the 2009 requirement, the National Defense Authorization  Act for Fiscal Year 2013 requires that DOD provide a consolidated budget  justification display that fully identifies the Aerospace Control Alert budget  for each of the military services and encompasses all programs and  activities of the Aerospace Control Alert mission for each of the following:  (1) procurement; (2) operations and maintenance; (3) research,  development, testing, and evaluation; and (4) military construction. However, according to DOD officials,  such a display is being developed for inclusion with the department’s  fiscal year 2015 budget submission to include the four budget categories  specifically identified by the act. The consolidated budget displays required by the Duncan Hunter  National Defense Authorization Act for Fiscal Year 2009 and the National  Defense Authorization Act for Fiscal Year 2013 should help provide  Congress and senior DOD decision makers with a more complete picture  of Aerospace Control Alert mission costs. However, in addition to Air  Force, Air National Guard, and Air Force Reserve personnel costs,  personnel costs from the other DOD components also support the  mission—including the Army and the Army National Guard personnel  providing ground-based air defense capabilities in support of the mission. Unless this additional information is included in DOD’s revised budget  display, DOD decision makers will not have comprehensive cost  information to make fully informed resource allocation decisions to  support the Aerospace Control Alert mission. Conclusions

The Aerospace Control Alert mission is critical to defending U.S.  airspace. Recommendation for Executive Action

As DOD expands its cost reporting in the consolidated budget justification  displays as required by section 354 of the Duncan Hunter National  Defense Authorization Act for Fiscal Year 2009 and section 352 of the  National Defense Authorization Act for Fiscal Year 2013, we recommend  that the Secretary of Defense direct the Under Secretary of Defense  (Comptroller) and responsible DOD organizations, as appropriate, to  ensure that all Aerospace Control Alert program and activity costs for  each of the military services are captured, including military personnel  costs of the Army and Army National Guard.
Why GAO Did This Study

To protect U.S. airspace, DOD performs the Aerospace Control Alert mission, which includes military forces arrayed in a rapid response posture to conduct both air sovereignty and air defense operations against airborne threats over the United States and Canada. The National Defense Authorization Act for Fiscal Year 2013 required that the Secretary of Defense submit a report to Congress that provides a cost-benefit analysis and risk-based assessment of the Aerospace Control Alert mission as it relates to expected future changes to the budget and force structure of the mission. The act also requires that GAO review DOD's report and submit any findings to the congressional defense committees. In response to this mandate, GAO examined (1) DOD's April 2013 reporting of a risk-based assessment and cost-benefit analysis of the Aerospace Control Alert mission as they relate to expected future changes to the budget and force structure of that mission and (2) the extent to which DOD has reported the total cost of the Aerospace Control Alert mission. GAO reviewed DOD's April 2013 report to Congress and Aerospace Control Alert budget justification displays, and interviewed knowledgeable DOD officials.

What GAO Found

In its April 2013 report to Congress, the Department of Defense (DOD) did not provide any new analyses, but provided the results of previous analyses related to the Aerospace Control Alert mission because, according to DOD officials, DOD was not expecting any future changes to the budget or force structure of the mission, including consideration of any basing location alternatives. DOD's April 2013 report summarized the results of three risk assessments that were conducted to support DOD's 2012 decision on which two alert basing locations could be removed from 24-hour alert status with the least amount of risk. The North American Aerospace Defense Command (NORAD), the Office of the Secretary of Defense Office of Cost Assessment and Program Evaluation, and the Continental U.S. NORAD Region performed these assessments and all concluded that, given the 2012 DOD decision that two alert basing locations would be removed from 24-hour alert status, the removal of the locations at Duluth, Minnesota, and Langley, Virginia, would provide the least increase in risk. DOD's April 2013 report also summarized a cost savings estimate developed after the decision to remove these basing locations from 24-hour alert status.
Along with the submission of DOD's budget requests for fiscal years 2010-14, the Air Force reported cost information for components of the Aerospace Control Alert mission in budget displays required by the Duncan Hunter National Defense Authorization Act for Fiscal Year 2009, but DOD did not report the comprehensive cost of the Aerospace Control Alert mission. Standards for Internal Control in the Federal Government notes that financial information is needed for periodic external reporting and, on a day-to-day basis, to make operating decisions, monitor performance, and allocate resources. The Air Force provided budget displays containing information related to Air Force and Air National Guard military personnel costs, flying hours, and certain other costs along with DOD's budget justification materials for fiscal years 2010-14. However, DOD did not report other military service costs associated with the Aerospace Control Alert mission. The National Defense Authorization Act for Fiscal Year 2013 now requires, in addition to the Air Force cost information required by the Duncan Hunter National Defense Authorization Act for Fiscal Year 2009, that DOD provide a consolidated budget justification display that fully identifies the Aerospace Control Alert budget for each of the military services and encompasses all programs and activities of the Aerospace Control Alert mission for each of the following: procurement; operations and maintenance; research, development, testing, and evaluation; and military construction. According to DOD officials, such a display is being developed for inclusion with the fiscal year 2015 budget submission. These consolidated budget displays should help provide a more complete picture of Aerospace Control Alert mission costs. However, other military personnel costs, including those associated with the Army and the Army National Guard personnel providing ground-based air defense capabilities, support the mission as well. Inclusion of this information, in addition to the information required in the budget justification displays, could provide decision makers with more comprehensive cost information to make fully informed resource allocation decisions to support the Aerospace Control Alert mission.

What GAO Recommends

GAO recommends that DOD, as it expands its cost reporting in response to current reporting requirements, ensure that all personnel costs related to the Aerospace Control Alert mission, including those of the Army and Army National Guard, are included in DOD's budget displays. DOD concurred with GAO's recommendation.