Summary: This report responds to section 322 of the Duncan Hunter National Defense Authorization Act for Fiscal Year 2009. Section 322 required the Secretary of Defense to contract for a study on the capability and efficiency of the depots of the Department of Defense (DOD) to provide the logistics capabilities and capacity necessary for national defense. DOD placed a task order under an existing contract with LMI, Inc. (LMI) to complete the study, which was to address a range of issues specified in section 322. As required by section 322, the task order specified that the contractor submit an interim report on its study to the Senate and House Committees on Armed Services not later than 1 year after the commencement of the study and a final report not later than 22 months after the date on which the Secretary of Defense enters into the contract. LMI submitted its interim report, containing background information and summary data on the DOD depot maintenance enterprise, to the Committees on Armed Services in December 2009. The final report, containing conclusions and recommendations, was provided to the Committees on Armed Services in February 2011. Section 322 also directed GAO to provide an assessment of the feasibility of the recommendations and whether the findings were supported by the data and information examined and to submit a report to the Committees on Armed Services of the Senate and House of Representatives within 90 days of the date on which the contractor submitted its final report. In response, our objectives were to determine the extent to which (1) LMI's reports addressed the five issues and 33 subissues specified in the law, (2) the findings in LMI's final report were supported by the data and information examined, and (3) the recommendations in LMI's final report were feasible.
LMI's reports addressed 26 of the 33 subissues specified in section 322, and partially addressed the other 7 subissues. For example, within the issue of the adequacy of reports submitted to Congress on each military department's maintenance workload, the reports addressed all 4 subissues, including how accurately depot budget lines reflect depot-level workloads, the accuracy of certain depot maintenance calculations, the usefulness of current depot maintenance reporting requirements, and whether current budgetary guidelines provide sufficient flexibility during the year of execution to make best-value decisions. For each of the other issues, the LMI reports addressed some subissues and partially addressed one or more subissues. For example, the LMI report addressed 5 of the 8 subissues on current and future maintenance environments, but partially addressed the other 3: performance-based logistics, supply chain management, and private-sector depot-level capability and capacity. LMI's study was generally consistent with research standards that define a sound and complete study with regard to design, execution, and presentation. For example, the study's scope was consistent with the available guidance, the study team verified and validated the study data, and assumptions were identified in internal documents and the interim and final reports. However, we also found some areas of concern. These concerns included limited documentation on the maintenance workload and servicemember deployment statistical models used as the basis for some findings, the absence of information in the reports on the limitations present in some of the data used in the study, and unclear report organization. For example, we and officials from the military departments noted that subrecommendations were difficult to identify. Implementation of all five recommendations presented in LMI's report is feasible according to subject matter experts in the depot maintenance community whom we interviewed. The recommendations are (1) revise the statutory framework for depot maintenance, (2) link acquisition and sustainment policies, (3) strengthen the core determination process, (4) improve depot maintenance reporting, and (5) establish an independent commission or series of facilitated forums to review the major alternatives for improving organic depot maintenance management and execution. Although feasible, the interviewees told us that they believe the fifth recommendation is unnecessary because issues highlighted in the study could be addressed by existing DOD bodies. Section 322 also specified that the final report shall include comments provided by the Secretary of Defense and secretaries of the military departments on the findings and recommendations of the study, but DOD's official response did not specifically address any findings or recommendations. DOD officials indicated that the department did not provide more specific comments because DOD did not provide the study--LMI did. Our review of LMI's internal documents determined that DOD and military department officials did provide input and feedback on aspects of the study throughout its design, execution, and report presentation. Without DOD's views about LMI's findings and recommendations, Congress does not have all of the information it needs to help establish a way forward toward more effective and efficient depot-level maintenance. We are making a recommendation that DOD report to Congress with its views on LMI's recommendations, any statutory and policy changes needed to implement the recommendations, actions and timelines for accomplishing ongoing and planned actions to implement the recommendations, and estimated costs and benefits of implementing the recommendations.
