[House Hearing, 112 Congress]
[From the U.S. Government Publishing Office]







                         [H.A.S.C. No. 112-153]

                     OPERATIONAL CONTRACT SUPPORT:

                       LEARNING FROM THE PAST AND

                        PREPARING FOR THE FUTURE

                               __________

                      COMMITTEE ON ARMED SERVICES

                        HOUSE OF REPRESENTATIVES

                      ONE HUNDRED TWELFTH CONGRESS

                             SECOND SESSION

                               __________

                              HEARING HELD

                           SEPTEMBER 12, 2012



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                   HOUSE COMMITTEE ON ARMED SERVICES
                      One Hundred Twelfth Congress

            HOWARD P. ``BUCK'' McKEON, California, Chairman
ROSCOE G. BARTLETT, Maryland         ADAM SMITH, Washington
MAC THORNBERRY, Texas                SILVESTRE REYES, Texas
WALTER B. JONES, North Carolina      LORETTA SANCHEZ, California
W. TODD AKIN, Missouri               MIKE McINTYRE, North Carolina
J. RANDY FORBES, Virginia            ROBERT A. BRADY, Pennsylvania
JEFF MILLER, Florida                 ROBERT ANDREWS, New Jersey
JOE WILSON, South Carolina           SUSAN A. DAVIS, California
FRANK A. LoBIONDO, New Jersey        JAMES R. LANGEVIN, Rhode Island
MICHAEL TURNER, Ohio                 RICK LARSEN, Washington
JOHN KLINE, Minnesota                JIM COOPER, Tennessee
MIKE ROGERS, Alabama                 MADELEINE Z. BORDALLO, Guam
TRENT FRANKS, Arizona                JOE COURTNEY, Connecticut
BILL SHUSTER, Pennsylvania           DAVE LOEBSACK, Iowa
K. MICHAEL CONAWAY, Texas            NIKI TSONGAS, Massachusetts
DOUG LAMBORN, Colorado               CHELLIE PINGREE, Maine
ROB WITTMAN, Virginia                LARRY KISSELL, North Carolina
DUNCAN HUNTER, California            MARTIN HEINRICH, New Mexico
JOHN C. FLEMING, M.D., Louisiana     BILL OWENS, New York
MIKE COFFMAN, Colorado               JOHN R. GARAMENDI, California
TOM ROONEY, Florida                  MARK S. CRITZ, Pennsylvania
TODD RUSSELL PLATTS, Pennsylvania    TIM RYAN, Ohio
SCOTT RIGELL, Virginia               C.A. DUTCH RUPPERSBERGER, Maryland
CHRIS GIBSON, New York               HANK JOHNSON, Georgia
VICKY HARTZLER, Missouri             BETTY SUTTON, Ohio
JOE HECK, Nevada                     COLLEEN HANABUSA, Hawaii
BOBBY SCHILLING, Illinois            KATHLEEN C. HOCHUL, New York
JON RUNYAN, New Jersey               JACKIE SPEIER, California
AUSTIN SCOTT, Georgia                RON BARBER, Arizona
TIM GRIFFIN, Arkansas
STEVEN PALAZZO, Mississippi
ALLEN B. WEST, Florida
MARTHA ROBY, Alabama
MO BROOKS, Alabama
TODD YOUNG, Indiana
                  Robert L. Simmons II, Staff Director
                Lynn Williams, Professional Staff Member
          William (Spencer) Johnson, Professional Staff Member
                    Lauren Hauhn, Research Assistant















                            C O N T E N T S

                              ----------                              

                     CHRONOLOGICAL LIST OF HEARINGS
                                  2012

                                                                   Page

Hearing:

Wednesday, September 12, 2012, Operational Contract Support: 
  Learning from the Past and Preparing for the Future............     1

Appendix:

Wednesday, September 12, 2012....................................    37
                              ----------                              

                     WEDNESDAY, SEPTEMBER 12, 2012
OPERATIONAL CONTRACT SUPPORT: LEARNING FROM THE PAST AND PREPARING FOR 
                               THE FUTURE
              STATEMENTS PRESENTED BY MEMBERS OF CONGRESS

McKeon, Hon. Howard P. ``Buck,'' a Representative from 
  California, Chairman, Committee on Armed Services..............     1
Smith, Hon. Adam, a Representative from Washington, Ranking 
  Member, Committee on Armed Services............................     2

                               WITNESSES

Crenshaw, BGen Craig C., USMC, Vice Director, J-4, Joint Staff...     5
DiNapoli, Timothy J., Acting Director for Acquisitions and 
  Sourcing, U.S. Government Accountability Office................     8
Estevez, Hon. Alan F., Assistant Secretary of Defense for 
  Logistics and Materiel Readiness...............................     3
Schwartz, Moshe, Specialist in Defense Acquisition, Congressional 
  Research Service...............................................     6

                                APPENDIX

Prepared Statements:

    DiNapoli, Timothy J..........................................    76
    Estevez, Hon. Alan F., joint with BGen Craig C. Crenshaw.....    44
    McKeon, Hon. Howard P. ``Buck''..............................    41
    Schwartz, Moshe..............................................    58
    Smith, Hon. Adam.............................................    43

Documents Submitted for the Record:

    [There were no Documents submitted.]

Witness Responses to Questions Asked During the Hearing:

    Mr. Platts...................................................    97
    Ms. Speier...................................................    97

Questions Submitted by Members Post Hearing:

    Mr. Schilling................................................   104
    Ms. Speier...................................................   101
 
OPERATIONAL CONTRACT SUPPORT: LEARNING FROM THE PAST AND PREPARING FOR 
                               THE FUTURE

                              ----------                              

                          House of Representatives,
                               Committee on Armed Services,
                     Washington, DC, Wednesday, September 12, 2012.
    The committee met, pursuant to call, at 10:05 a.m. in room 
2118, Rayburn House Office Building, Hon. Howard P. ``Buck'' 
McKeon (chairman of the committee) presiding.

    OPENING STATEMENT OF HON. HOWARD P. ``BUCK'' MCKEON, A 
 REPRESENTATIVE FROM CALIFORNIA, CHAIRMAN, COMMITTEE ON ARMED 
                            SERVICES

    The Chairman. The committee will come to order.
    This morning we are reminded once more what a dangerous 
world we live in and the risks many Americans take to serve our 
country abroad. My thoughts and prayers, together with those of 
members of the committee, are with the families, loved ones of 
those that we have lost in Libya.
    We meet today to receive testimony on operational contracts 
support--that is, the services that our military buys to 
directly sustain operations like those in Afghanistan.
    According to a recent study by the Center for Strategic and 
International Studies, the Department of Defense spends, on 
average, nearly one third of its entire budget contracting for 
services. And while this committee and others in Congress have 
taken aggressive actions to reform the Government's acquisition 
processes, most of our time and effort has been focused on 
major defense acquisition programs, such as the Joint Strike 
Fighter and the Littoral Combat Ship. Perhaps this is because 
they are tangible and there is a more formal process used to 
procure hardware. Regardless, we don't spend nearly as much 
time addressing issues regarding the way the DOD [Department of 
Defense] contracts for services such as engineering, 
maintenance, logistics, and base support.
    Contracting for services cannot be taken lightly. Here is a 
fact, and one that I expect our witnesses will not challenge: 
The U.S. military cannot today fulfill its responsibilities to 
our national security without a significant contribution by 
many hardworking folks that are not in the direct employment of 
the U.S. Government.
    That fact extends to war zones, too. Most of us are 
familiar with the term ``contingency contracting,'' which has 
been used over the last several years to refer to contracts in 
Iraq and Afghanistan. The term likely conjures up memories of 
money wasted on $600 toilet seats, funding that fuels 
corruption, and the loss of hearts and minds any time armed 
security guards kill or injure civilians.
    But the goal of today's hearing is not to reexamine these 
or other incidents. There has already been extensive work to 
document these deficiencies and to capture lessons learned. The 
goal is to learn from the past and charter a way forward, 
because I think we can all agree that we will continue to be 
reliant on contractors for future operations.
    As such, the topic before us today is complex, but it is 
also important. We learned a lot of hard lessons on this issue 
in Iraq and Afghanistan. We were ill-prepared for the level of 
contracting that was required to support these missions, and, 
as a result, outcomes suffered. In some cases, those 
consequences were grave, and brave Americans lost their lives 
as a result.
    The question before us is how we can improve operational 
contract support outcomes, from saving lives to reducing waste 
and graft, to delivering a unity of effort consistent with our 
military commanders' intent. This will require leadership and 
an emphasis on the importance of operational contract support.
    Excellence must be demanded in each of the requirements 
generation, contract award, and contract management phases. A 
prerequisite for excellence is planning and training like we 
fight. There are many recommendations that have been advanced 
to meet these goals, and I look forward to exploring those 
recommendations in greater detail today.
    I am certain that our witnesses' testimony will help us and 
the Department of Defense as we continue the mission in 
Afghanistan and prepare for the challenges that may come here 
at home and around the globe.
    Mr. Smith.
    [The prepared statement of Mr. McKeon can be found in the 
Appendix on page 41.]

STATEMENT OF HON. ADAM SMITH, A REPRESENTATIVE FROM WASHINGTON, 
          RANKING MEMBER, COMMITTEE ON ARMED SERVICES

    Mr. Smith. Thank you, Mr. Chairman.
    And I share your remarks on the events in Libya and also in 
Egypt. Our thoughts and prayers certainly go out to the people 
who lost their lives and their families. It is a tragic 
incident and reminds us, again, of how unstable the world is 
and can be.
    I thank you for holding this hearing. As well, I thank our 
witnesses. I look forward to the testimony and the question-
and-answer period.
    Logistics and contracting out are critical, critical parts 
of our military and national security operation that don't 
typically get the attention that they obviously deserve. With 
all of the human resources and all of the material resources 
that we have, getting them all in the right place at the right 
time and making sure they are properly coordinated is an 
enormous and very important task and something that I believe 
our military does better than any military in the world.
    And part of the reason why we are as successful as we are, 
a piece of that, of course, is contracting out those services, 
figuring out what can be done in-house and what needs to be 
contracted out--also not an easy process. And, of course, there 
are our legislative and parochial battles that get in the way 
of making it an easy process, as well.
    And so I think it is important that we examine that issue 
and try to figure out how to maximize our effectiveness at 
contracting out and pulling together those logistical 
challenges.
    I also believe that, given the wars in Iraq and 
Afghanistan, we have an excellent opportunity right now for a 
lessons-learned approach, go back and look and see what we did, 
what worked, what didn't work. A lot of it had to happen fairly 
quickly, so I certainly understand that decisions had to be 
made quickly. But now that we have had some time to think about 
it and look at it, I think this is a great opportunity to learn 
from that and make improvements where we can.
    With that, I yield back. And I thank the chairman again for 
holding this very important hearing.
    [The prepared statement of Mr. Smith can be found in the 
Appendix on page 43.]
    The Chairman. Thank you.
    This will be a unique hearing.
    We have today the Honorable Alan F. Estevez; Brigadier 
General Craig C. Crenshaw, Vice Director, J-4, Joint Staff; Mr. 
Moshe Schwartz, Specialist in Defense Acquisition, 
Congressional Research Service; and Mr. Tim DiNapoli, Acting 
Director for Acquisitions and Sourcing, U.S. Government 
Accountability Office.
    So we have a good cross-section here of people that I think 
will be very helpful to us in going through this process, and 
we thank you for being here.
    And we will turn first to Mr. Estevez.

   STATEMENT OF HON. ALAN F. ESTEVEZ, ASSISTANT SECRETARY OF 
          DEFENSE FOR LOGISTICS AND MATERIEL READINESS

    Secretary Estevez. Thank you, Chairman McKeon, Ranking 
Member Smith, distinguished Members of the committee. Good 
morning. I appreciate the opportunity to appear before you 
today to talk about the improvements we have made with respect 
to the management and oversight of operational contract support 
and our plan to sustain these efforts into the future.
    Before I do so, I do want to thank this committee for its 
strong support of our men and women in uniform and for a 
civilian workforce across the Department of Defense.
    Operational contract support, or OCS, entails the planning 
for and managing the reality of contractors on the battlefield. 
As Brigadier General Crenshaw and I detailed in our joint 
written statement, which I believe was submitted for the 
record, the Department has made significant improvements across 
the board in a range of OCS areas over the last 6 years. In 
fact, during my several visits to Afghanistan over the last 
number of years, I have witnessed the ongoing implementation of 
our OCS improvements that we have made based on the lessons we 
have learned over the last 10 years.
    Congressional focus on this important area has been very 
helpful in both maintaining visibility and contributing to our 
ability to institutionalize OCS. We also appreciate the efforts 
of a variety of external boards and commissions, including the 
Gansler Commission, the Commission on Wartime Contracting, the 
GAO [Government Accountability Office], and Congressional 
Research Service. We appreciate their expertise, effort, and, 
as appropriate, their willingness to partner with us as we 
implement our recommendations.
    The Office of the Secretary of Defense and the Joint Staff 
together have embarked on an aggressive agenda to improve 
planning for and managing contracts and contractors on the 
battlefield. Our strong commitment to continuous progress in 
this area is demonstrated by the accomplishments the Department 
has made, from organizational changes such as the standup of 
the Joint Contingency Acquisition Support Office and the 
embedding of OCS planners at our combatant commands, to 
development and updates to policy and doctrine, from increased 
visibility and accountability of contractors on the battlefield 
today, to improvements in training and education in both the 
acquisition and nonacquisition workforce responsible for 
contingency contracts management.
    The lessons we have learned from recent operations are 
being incorporated and applied to OCS across all echelons of 
the Department, including the military services and the 
combatant commands. We are already seeing a cultural shift in 
the way we plan and prepare for future contingency operations.
    As an example, within the first day after the earthquake, 
tsunami, and nuclear reactor failure in Japan, Pacific Command 
established the Air Force as the lead Service for contracting. 
This meant that all forces deploying to Japan had a clear 
understanding of the contracting authority and would not be 
competing against each other for scarce resources--a critical 
lesson that we learned from our experiences in Central Command. 
Notably, the first operations order issued by Pacific Command 
in response to this disaster was the operations order 
establishing this contract and command relationship.
    To sustain these advances, we need to maintain our focus, 
secure and solidify our gains, and continue the momentum we 
have in implementing OCS capability. To lose such capability 
now would be truly wasteful, and we are strongly committed to 
ensure that this does not happen.
    I believe that our testimony will reassure you that DOD has 
worked hard to improve our oversight and management in this 
very critical area and that we have every intention of 
maintaining these efforts into the future. We will continue to 
mature as we apply additional lessons learned from Afghanistan 
and other operations worldwide.
    We are grateful for the committee's continued interest and 
support in ensuring that operational contract support remains a 
priority. I will be happy to answer any questions that you may 
have.
    Thank you.
    [The joint prepared statement of Secretary Estevez and 
General Crenshaw can be found in the Appendix on page 44.]
    The Chairman. Thank you.
    General.

STATEMENT OF BGEN CRAIG C. CRENSHAW, USMC, VICE DIRECTOR, J-4, 
                          JOINT STAFF

    General Crenshaw. Chairman McKeon, Ranking Member Smith, 
and distinguished members of the committee, I am pleased to 
appear before you today to testify on the Department of 
Defense's progress in enhancing our ability to plan and execute 
operational contract support contingency operations.
    I support the Joint Staff Director for Logistics, who is 
the principal advisor to the Chairman of the Joint Chiefs on 
the entire spectrum of logistics, to include strategic and 
operational planning and doctrines related to operational 
contract support, or OCS. My staff and I have worked closely 
with the Office of the Secretary of Defense, the Services, the 
defense agencies to refine the policies, doctrines, tools, and 
processes needed to effectively plan for and execute OCS.
    I am pleased to report the Department has made significant 
progress to improve the operational planning needed to 
effectively use contract support as part of DOD's total force. 
I am confident that our ongoing efforts will ensure that we 
meet the warfighters' current and future needs while judicially 
managing DOD resources and balancing risk.
    As Mr. Estevez and I note in our written statement, we 
acknowledge our past weaknesses; however, our offices are in 
lockstep on a course to institutionalize OCS as an essential 
warfighting capability for the current and future joint force.
    Due to the ascending of contracting as an integral part of 
military operations, the Joint Staff has led a variety of 
efforts to strengthen this critical capability area to ensure 
that when we go to war in the future, we are better prepared to 
execute effectively and efficiently and, most importantly, to 
provide the best possible support to the warfighter at a 
reasonable cost.
    We are absolutely committed to this course, originally set 
by Admiral Mullen and affirmed by General Dempsey, to ensure we 
get this right as quickly as possible.
    Institutionalizing operational contract support is a major 
effort that is well under way and represents a major culture 
shift in how we plan for and execute military operations. We 
began this deliberate effort in 2007 and have significantly 
improved the strategic guidance, operation imperatives, and 
policy implications required. The Joint Staff is committed to 
having all the necessary guidance, doctrines, policies, 
processes, and resources in place within the next year.
    Much has been done to improve operation contract support, 
and our work will continue. The underlining theme for future 
planning and supporting of processes involves closer links of 
contracts and contractors to operational effect in order to 
more rapidly and decisively achieve the Joint Force commander's 
intent. We increase our focus on planning and process that not 
only delivers supplies and services to the warfighter in a 
responsible, cost-effective manner, but leverages the economic 
benefits of DOD spending to achieve national strategic and 
operational objectives.
    In closing, I would like to emphasize a few critical points 
with respect to the Department's increased use of contractor 
support.
    First, I am convinced of the advanced military advantages 
this capability brings when planned and used appropriately. Our 
military contract capability enables us to maintain a 
scaleable, responsive, and cost-effective All-Volunteer Force 
while maintaining combat capabilities. In the past decade, we 
have recognized that contracting delivers important support to 
our troops while advancing operational objectives, such as 
those in a counterinsurgency strategy or stability operations.
    Our contracting professionals, logisticians, and commanders 
in the field are performing superbly in a dangerous environment 
while challenged with complex supporting policies and 
processes.
    The bottom line is that operational contract support is an 
integral and important part of our military capability, and our 
efforts are squarely focused on how to best accomplish the 
mission. I know we share this objective with Mr. Estevez and 
the entire OSD [Office of Secretary of Defense] staff.
    Finally, sir, let me sincerely thank you for all you have 
done on this committee for our marines, our sailors, our 
soldiers and airmen to ensure they are well-equipped. And thank 
you for the support you provide to them as well as their 
families.
    Our goals and ideas are the same. We are on the same sheet 
of music. What we want is a deliberate process that provides 
oversight of our operational contract support. We have made 
great strides to that end, and we are not there yet, but we are 
prepared to go further.
    Again, thank you for this opportunity to appear before you. 
I look forward to answering your questions.
    [The joint prepared statement of General Crenshaw and 
Secretary Estevez can be found in the Appendix on page 44.]
    The Chairman. Thank you.
    Mr. Schwartz.

STATEMENT OF MOSHE SCHWARTZ, SPECIALIST IN DEFENSE ACQUISITION, 
                 CONGRESSIONAL RESEARCH SERVICE

    Mr. Schwartz. Good morning, Chairman McKeon, Ranking Member 
Smith, distinguished members of the committee. Thank you for 
the opportunity to discuss operational contract support.
    For more than 10 years, the United States has been waging 
wars in Iraq and Afghanistan. Contractors have played a pivotal 
role in these operations, making up more than half of the 
Department of Defense's workforce in Iraq and Afghanistan.
    As DOD has acknowledged, the military was unprepared for 
the extent to which contractors were used in these conflicts. 
Contracting was often done on an ad hoc basis without putting 
in place sufficient oversight systems, leading to instances of 
poor performance, billions of dollars of waste, and failure to 
achieve mission goals.
    Contractors will likely continue to play a central role in 
large-scale military operations. To meet the challenges of 
future operations, DOD must be prepared to effectively award 
and manage contracts at a moment's notice, anywhere in the 
world, in unknown environments, and on a scale that may exceed 
the total contracting budget of any other Federal agency.
    DOD has made substantial progress in improving how it 
conducts operational contract support. However, despite this 
great progress, after 10 years of war DOD still faces 
significant challenges in effectively utilizing and managing 
contractors to support current and future overseas operations.
    A number of analysts have argued that one reason DOD has 
done a poor job in planning for and managing contractors is 
that contracting is not sufficiently valued within the culture 
of the military. According to these analysts, contract 
management is a mission-essential task, and DOD must change the 
way it thinks about contracting, transforming it from an 
afterthought to a core competency.
    Three common recommendations aim to elevate the role of 
contracting within the culture of DOD.
    First, senior leadership must focus on articulating the 
importance of contract support. Without active and sustained 
support from senior leadership, the culture is unlikely to 
change. When management establishes priorities, articulates a 
vision, and aligns incentives and organizational structures to 
match these priorities, the foundation will be set for real 
change.
    Second, the professional military education curriculum must 
incorporate courses on operational contract support throughout 
its various efforts. One key to changing the culture and 
improving contracting is better education. Increased education 
for nonacquisition personnel is critical to changing how the 
military approaches contracting both before and during overseas 
operations.
    Third, training exercises must incorporate contractors 
playing the role that they would play on the battlefield. A 
number of analysts have called for incorporating contractors 
and contractor scenarios into appropriate military exercises to 
better prepare military planners and operational commanders for 
future operations. Given the extent to which contractors may be 
relied upon in future operations, conducting exercises without 
contractors could be akin to training without half of the force 
present.
    While changing the culture may be an important step, many 
analysts argue that it is only part of the battle. Effective 
and efficient operational contract support will not occur until 
an infrastructure is built to facilitate good contracting 
decisions.
    Three common fundamental systemic weaknesses of contractor 
support are frequently cited.
    First, poor planning. In Iraq and Afghanistan, there was no 
comprehensive plan for how and to what extent to use 
contractors. Failure to include contractors in planning and 
strategy puts DOD at risk of being unable to get the 
capabilities it needs when it needs them and at an acceptable 
cost.
    Second, lack of reliable data. Without reliable data, there 
may not be an appropriate basis for measuring or assessing the 
effectiveness of contracting efforts, making policy decisions, 
or providing transparency into Government operations. A lack of 
reliable data could leave analysts and decisionmakers to draw 
incorrect or misleading conclusions. In Afghanistan, DOD did 
not have accurate data or sufficiently tracked data upon which 
to make strategic contracting decisions.
    Third, lack of a sufficiently large and capable workforce 
to plan for, manage, and oversee contractors. There were simply 
not enough resources or personnel in theater to conduct 
adequate contractor oversight in Iraq and Afghanistan, leading 
to instances of poor contract performance. DOD has documented 
how a lack of oversight has resulted in contracts not being 
performed to required specifications and to the theft of tens 
of millions of dollars' worth of equipment, repair parts, and 
supplies.
    Mr. Chairman, distinguished members of the committee, if 
contractors continue to be a critical part of the total force, 
DOD must be able to effectively incorporate contractors and 
contract management into operations.
    This concludes my testimony. Thank you again for the 
opportunity to appear before you to discuss these issues. I 
will be pleased to respond to any questions you may have.
    [The prepared statement of Mr. Schwartz can be found in the 
Appendix on page 58.]
    The Chairman. Thank you.
    Mr. DiNapoli.

     STATEMENT OF TIMOTHY J. DINAPOLI, ACTING DIRECTOR FOR 
   ACQUISITIONS AND SOURCING, U.S. GOVERNMENT ACCOUNTABILITY 
                             OFFICE

    Mr. DiNapoli. Chairman McKeon, Ranking Member Smith, 
members of the committee, good morning. I am pleased to be here 
today to discuss how the Department of Defense can improve its 
use of contractors in future contingencies.
    For more than 15 years, GAO has made recommendations 
intended to improve the way the Department plans for, manages, 
and oversees contractors in deployed locations. Given the 
longstanding, recurring nature of these challenges, in June 
2010 we called for a cultural change, one that emphasized an 
awareness of contractor support throughout the Department. 
Consistent with this message, in January 2011 the Secretary of 
Defense identified the need to institutionalize changes to 
bring about such a change.
    In my statement today, I will highlight three areas in 
which sustained DOD leadership is needed to improve operational 
contract support. These areas include better planning at the 
strategic and operational level, enhancing the workforce 
capacity, and providing the tools needed to better account for 
contracts and contractors. My statement is based on GAO's broad 
body of work involving operational contract support and DOD 
contract management issues.
    First, future contingencies are inherently uncertain, but, 
with better planning, DOD can reduce the risk associated with 
those uncertainties.
    At the strategic level, DOD has or is in the process of 
developing new policies and guidance. It also has established a 
Functional Capabilities Integration Board, which is currently 
drafting an action plan to close gaps in operational contract 
support capabilities.
    At the operational level, previous efforts to translate 
those strategic requirements into operational plans have been 
mixed. In 2010, we found that many of the contract support 
plans, those that were approved and those that were in draft, 
still needed improvement. To increase awareness of operational 
contract support considerations, we recommended in 2006 and 
again in 2012 that DOD include these issues in the professional 
military education provided to military commanders and senior 
leaders.
    Turning to the workforce more generally, having the right 
people with the right skills in the right numbers can make the 
difference between success and failure. As such, DOD has 
identified rebuilding the acquisition workforce as a strategic 
priority. In that regard, the Department has used the Defense 
Acquisition Workforce Development Fund and taken other actions 
to increase the size of the workforce from about 118,000 in 
fiscal year 2009 to about 136,000 as of last December.
    As part of these efforts, DOD is rebuilding the capacities 
of the Defense Contract Management Agency and the Defense 
Contract Audit Agency. However, gaps remain in DOD's overall 
strategic workforce planning efforts.
    DOD has also identified the important role that 
nonacquisition personnel play in the acquisition process, 
especially those that serve as contracting officers' 
representatives. DOD's longstanding challenge in this regard is 
to be able to identify and train these individuals in a timely 
fashion.
    Lastly, DOD needs to be able to better account for 
contracts and contractor personnel. At the start of operations 
in Iraq and Afghanistan, DOD found itself unable to do a number 
of key things. First, it really was not able to identify the 
number of contractors, where they were, and what activities 
they were performing. Second, they didn't have the capability 
to maintain effective control over its contracting activities. 
Third, it lacked a process by which it could determine whether 
contractors or contractor personnel pose a potential risk to 
U.S. interests. As issues arose, DOD needed to develop the 
policies, processes, and tools to do so. Having these in place 
before the next contingency is essential.
    In conclusion, DOD knows it needs to learn from its 
experiences gained over the past 10 years. DOD's actions to 
date are positive, but DOD's challenge will be to sustain these 
over the long term, as bringing about cultural change is 
neither easy and is no means quick. As the DOD draws down its 
efforts in Afghanistan, DOD's challenge is to ensure that those 
lessons that were learned in Iraq and Afghanistan are not 
forgotten.
    Mr. Chairman and members of the committee, this completes 
my statement. I will be happy to answer any questions that you 
may have.
    [The prepared statement of Mr. DiNapoli can be found in the 
Appendix on page 76.]
    The Chairman. Thank you.
    Your complete statements of each of you will be included in 
the record, without objection.
    I would like to ask all of you if you have looked at the 
effects of sequestration, what it will do to the contracting 
and to your areas of responsibility.
    Mr. DiNapoli. Mr. Chairman, we have not done that. You 
know, the Administration has not submitted its sequestration 
report, as far as I know, as of last night or so. So we really 
aren't in a position to comment upon that.
    Secretary Estevez. Mr. Congressman, obviously, 
sequestration is bad from the viewpoint of the Department of 
Defense, and we hope that we will get relief from that in a 
balanced manner.
    Most of the contracting that we are talking about--all of 
the contracting we are talking about is in the O&M [Operations 
and Maintenance] accounts, mostly in OCO, Overseas Contingency 
Operations, fund. We will sustain the things we need to do for 
the warfight, which means there will be risk-taking back here 
in those accounts. But we hope to alleviate that by having 
sequestration negated, if you would.
    Mr. Schwartz. Mr. Chairman, the sequestration applies to 
all defense budgetary resources, including not only DOD's base 
budget but, of course, also OCO funding and unobligated 
balances for prior years. Under budget law, it is my 
understanding that a sequester levies the same percentage 
decrease to each program, project, and activity. There is no 
distinction for OCO versus other defense resources.
    The precise percentage cut under sequester, of course, will 
not be known until the fiscal year 2013 appropriations level in 
effect as of January is enacted.
    Some DOD spokesmen have suggested that they could protect 
war funding by making larger cuts in base budget funding. This 
would apply to those accounts and programs, projects, and 
activities which fund both base budget and war funding. DOD may 
have some flexibility regarding contracts if they are within 
the same program, project, and activity.
    General Crenshaw. Sir, the Joint Staff and General Dempsey 
have stated previously that when you look at sequestration, 
that it is a budget for the Joint Force and that it should not 
be thought of as separate Service budgets, but be comprehensive 
and carefully devise a set of choices. And when those choices 
are made, you produce a different type of balance.
    We can't say precisely what the result of sequestration 
will be, but there are some potentials of certainly some of our 
weapons system programs--new weapons system programs may be in 
jeopardy. But to the extent that we have looked at and 
understand what sequestration is, the total impact, at this 
point, we cannot precisely state, sir.
    The Chairman. Thank you.
    Mr. Estevez and General Crenshaw, in your written testimony 
you mention that the training and education efforts are aimed 
at a range of audiences, from commanders to acquisition 
professionals to subject-matter experts performing oversight. 
However, you make no mention of predeployment training or 
exercises.
    We often hear the mantra that we train like we fight. With 
acknowledgment that the future force will be heavily reliant on 
contractor support on the battlefield, what efforts are you 
taking to incorporate contractors in predeployment training and 
exercises?
    General Crenshaw. Sir, we recognize that, as was stated 
earlier, that you need to train the way you fight. We have 
instituted training within our various exercises to really 
include training as we conduct our OPLAN [Operations Plan] 
exercise, as well. We have addressed the Annex W [Operational 
Contract Support Annex], which talks to contract, contracts 
planning, contract support.
    So this is an opportunity, for one, to get it from a 
strategic level of focus and then implement it during the 
exercises. The exercises create scenarios where our contractor 
planners can really exercise and go through the process of what 
does it take. It is built off of different types of scenarios 
based on the particular OPLAN.
    We are not there yet, but I think the idea that we are now 
having a discussion and really have put some things on paper. 
And to the extent of being able to exercise it the last couple 
of years, we are headed in a positive direction.
    Secretary Estevez. I would add, Congressman, that, you 
know, in the current fight, as the units rotate in, we ensure 
that there is adequate training for contracting officer 
representatives. And for units that have more responsibility 
related to contract support, such as the Expeditionary Support 
Command that is currently deployed, had extensive training, 
including from the OSD level, related to operational contract 
support on the battlefield. So that is for today.
    As General Crenshaw said, we do have much work to do to 
ensure that that gets developed into criteria for the future 
for whatever battle we may be going to. So today we are doing 
it, but it is not imbedded for the long term, and that is where 
we have to go.
    The Chairman. Thank you.
    Mr. Schwartz, Mr. DiNapoli, do you believe that the DOD 
training efforts are sufficient to prepare the operational 
force for how contractors will be used in future operations?
    Mr. Schwartz. Apparently, I am going first on that one.
    I think that DOD has acknowledged that they have a long way 
to go in this area. Acknowledging, again, that they have also 
made substantial progress on that, I think there has not been 
much disagreement that there is more that can be done. So I 
think, that, we can look forward to.
    Mr. DiNapoli. You know, I think this is an opportunity to 
look for increasing training at all levels of one's 
professional development. When you think about using 
contractors, we use contractors not only to support operational 
forces in the field, but we use contractors in the Pentagon and 
we use contractors on bases. And so, to look for opportunities 
to increase the training and awareness of individuals at the 
very beginning of their career and throughout on the roles and 
responsibilities that one has to oversee and manage contractors 
and the important role that contractors play and what things we 
should be doing and should not be doing will be essential.
    Because you should, as you go toward deployment, we should 
be well aware of those roles and responsibilities so that we 
are not receiving training the last 2 weeks before going to 
deployment for the first time. It should be part of that 
culture, that we are using that training all throughout their 
development to be better situated to address contractors once 
they are deployed.
    The Chairman. I was meeting with a combatant commander 
yesterday, and I was talking to him about the effects of 
sequestration. And his concern was that, in trying to find out 
the $487 billion cuts and then the $500 billion, $600 billion 
on top of that, what will happen to training? Because there is 
concern that that is an easy way to find savings, because it is 
hard to measure how much training we need going forward.
    I know, as I visited bases, the National Training Center, 
when we went on our trip and were up at Lewis-McChord and other 
visits I have made to other bases, they are really focusing 
heavily on training the troops that are on the way to 
Afghanistan for IEDs [Improvised Explosive Device]. That is our 
biggest--seems to be our biggest problem. And they are really 
doing a good job. But if we have to pull back that training to 
meet other demands elsewhere, this means lives.
    And so that is something I have a big concern about, as did 
this combatant commander yesterday.
    Mr. Smith.
    Mr. Smith. Thank you, Mr. Chairman.
    Along the same lines, sequestration--I know with 
sequestration there are going to be some reductions in 
expectations in terms of where the money is at in defense. If 
you look at what we were projected to spend, I guess, 2 years 
ago, 18 months ago now, and what we are actually going to 
spend, it is quite a bit less.
    So imagine opportunities here, when you are looking at your 
operational contract support. If you were told, okay, you have 
to make this leaner and efficient tomorrow because, you know, 
there is just not going to be as much money as there was, what 
opportunities do you see with the contracting community and, 
for that matter, with existing personnel to say, here is how we 
should do this better, here is how we can get more out of the 
money we are spending and get the best positive result? Give me 
just a couple of examples of how you look at it and see that we 
are just not using our personnel as efficiently and as 
effectively as we could.
    And part of the problem here is, for an extended 7-, 8-year 
period of time, we had, you know, a fair amount of money. And 
certainly we are all familiar with the problems of too few 
resources. There are also problems with having too much. It 
comes at you too fast; there is not the same discipline that 
comes with that.
    So as we move into a scarce resource area, whether you have 
thought specifically about sequestration or not, I am sure have 
thought about how do you get by on less and get more efficient. 
What are the opportunities in the contracting area, do you 
think, to help deal with that resource challenge?
    And I am sorry, I don't know who--whoever wants to dive in 
first.
    Secretary Estevez. I will start, Congressman Smith.
    I think we need to take this in the broader area rather 
than specifically on operational contract support, but with the 
contracting in general. And, you know, 2 years ago, Dr. Carter 
kicked off ``Better Buying Power'' when he was the Under 
Secretary for AT&L--acquisition, technology, and logistics. And 
Frank Kendall has continued forward on that program, and is 
moving to strengthen it further.
    When you look at the contracting we are talking about, 
mostly services-type contracting, which is, as I believe I 
said, about a third of our spend, $200 billion a year in 
services contracting, there are lots of things that we are 
doing under Better Buying Power to address that from the macro 
scale.
    First, we have to ensure competition in our contracting, 
and there are lots of ways to do that. One is ensuring that we 
are not just going on the sole source, and putting in the 
processes to drive that competition----
    Mr. Smith. Can I ask you about that? Sorry. I mean, 
competition is good, but I think one of the things with the 
contracting that has become a bit problematic is, as you take 
multiple bids--in fact, we are dealing with this in a couple 
different programs--you know, do we down-select to three? Do we 
down-select to two?
    It is not always the case that more competition is better. 
At a certain point, you are drowning in process. And you 
compete, you pick a winner, the person who doesn't win 
challenges it, and we are 6, 7 years out and, you know, taking 
forever to make a decision.
    And I know it is a tough balance. But you raise that issue; 
you are in that world. How do we strike that balance?
    Secretary Estevez. Especially when you are trying to do it 
rapidly in a wartime scenario.
    Mr. Smith. Right.
    Secretary Estevez. I think, again, we need to separate the 
acquisition of things, equipment, where we tend to go toward 
those type of down-select opportunities----
    Mr. Smith. A lengthy process.
    Secretary Estevez [continuing]. Versus services, where it 
depends on what you are looking for, but there could be lots of 
people that could do that.
    Mr. Smith. Okay.
    Secretary Estevez. The other thing you do there is you put 
contracts on the shelf--Wildcat, for example--but you have 
competition within that, which is the lesson we learned, 
frankly, so that there are opportunities to drive that. And 
then you can down-select pretty rapidly, depending on the task 
order you are looking for.
    The other thing, you know, a highlight is of course we 
asked each of the Services--and they have implemented this--to 
put a senior executive in the Service at the Deputy Assistant 
Secretary level to manage services and to oversee services 
contracting, again, to put emphasis on the process.
    You know, we run people through Defense Acquisition 
University, and we step them up as they become program managers 
to buy things; we didn't necessarily have the same process for 
buying services. So by putting that kind of level of oversight 
into the Services and watching and putting peer reviews in 
management that you spend in the services area, we are able to 
draw better use of the dollars in that area.
    And that rolls down to contracting out on the battlefield. 
Contracting on the battlefield is, frankly, just a subset of 
what we do in the general services contracting area.
    Mr. Smith. Okay.
    Anybody else want to take a stab at that?
    Mr. Schwartz.
    Mr. Schwartz. Sure. I will highlight three things that I 
think could substantially help the efficiency.
    The first one is reliable data upon which to make 
decisions. I think it was the Guard, just 2 days ago, came out 
with a report saying DOD is requesting funding for fuel for the 
Afghan Air Force, but that there was not sufficient data to 
understand how much fuel they needed and where the fuel 
facilities even were that were being used.
    Better data could help you judge how effectively you are 
executing those contracts and decide to go forward, to double 
down, or maybe cut back because it is not being effective. So I 
think data could help substantially.
    And then there are two other things I would like to 
highlight. One of them is upfront planning. There have been 
examples reported by GAO and some of these special inspector 
generals and the IGs on dining facilities that were built as 
troops were being relocated to another forward operating base, 
or two schools that were being built across the road from each 
other. That is a planning consequence. And better planning up 
front can save a lot of money and efficiency and effectiveness 
further down the line.
    And the third one I would point out is in-field, consistent 
oversight as projects are being done. There have been 
instances, again, of projects that weren't built up to specs 
and, as a result, roads were crumbling or bridges weren't able 
to last more than a few months because of a lack of good 
oversight as things were being built. That prevents having to 
rebuild as well as the reputation of the effectiveness of how 
we are executing our mission.
    Mr. Smith. Okay. Thank you.
    Mr. DiNapoli. Just to add on to the conversation, DOD has 
had----
    Mr. Smith. Can you pull the microphone over? When it gets 
over there, it is kind of hard to hear you. Go ahead.
    Mr. DiNapoli. GAO has had DOD contract management on a 
high-risk list since 1992 and in part because of services 
acquisition.
    Over the last decade or so, as DOD has increased its use of 
services, what we have called for is more strategic planning 
for services, such that we would know what we are spending and 
who we are spending it from, and using that data to try to 
understand what our spending patterns are and how we might 
leverage the Government's buying power. I think we will be 
putting out a report in the near future that looks at the 
Government-wide strategic sourcing efforts and how we could do 
better in strategic sourcing.
    The other thing is a more tactical level, so when you talk 
about contractors or individual contracts, we do need to have 
the big three of, you know, better defining requirements, using 
the right contracting approach, and providing effective 
management oversight. In each area, DOD has made efforts to try 
to do that, but we still find lapses in the individual 
elements.
    With regard to competition, we do think competition does, 
in using market forces, does drive down prices, but you have to 
have effective competition. And so when we are looking, over 
the past year or so--and we have looked at various aspects of 
competition--in the efforts that DOD has made to increase 
competition, I mean, they only receive one bid, for example.
    And there is that fine line between going too far on the 
competition side but not getting enough. So you can have 
competitive effects in a number of different ways. So if we can 
continue to look for opportunities to increase competition as 
appropriate, I think that will help drive down prices on the 
individual contract actions.
    Mr. Smith. Okay.
    Thank you, Mr. Chairman. I yield back.
    The Chairman. Thank you.
    Mr. Bartlett.
    Mr. Bartlett. Thank you very much.
    Do our operational contract support activities include 
those projects that we pursue in concert with the Department of 
State?
    Secretary Estevez. Let me address that, Congressman 
Bartlett.
    State has their own contracting actions, but we are 
partnering with State on a number of initiatives, including how 
we track contractors on the battlefield. We are both using the 
SPOT program to do that. As we did the transitioning in Iraq, 
we continued to provide them with contract support in a number 
of areas where they didn't yet have the capability to do that.
    So there is a number of areas where we are absolutely 
partnering with State.
    Mr. Bartlett. I understand that on many of these 
reconstruction projects that we work in concert with the State 
Department. Are those always their contracts? Are they 
sometimes our contracts?
    Secretary Estevez. That depends on the nature of the 
contract. I mean, if we are expending DOD CERP [Commander's 
Emergency Response Program] dollars for it, then we are going 
to be doing the contracting. If it is a USAID [United States 
Agency for International Development] project, then they are 
going to be doing the contracting on it.
    Mr. Bartlett. So then there are three types of contracting 
we do there: those that the State Department is involved in, 
the operational contract support, and contingency contracting.
    In the clips I read each day, there have been a number of 
articles about huge amounts of missing money, money just plain 
stolen from contracts, projects that are not completed and just 
abandoned, excessive cost, exorbitant cost on these contracts.
    Can you tell me in which of these three categories of 
contracts most of this occurs?
    Secretary Estevez. I am not prepared to discuss U.S. 
Department of State or USAID contracts. I can say for 
Department of Defense contracts, that we are actively managing 
so that that does not happen. And I would expect that they are 
also, likewise, but I really can't address how they would go 
about that.
    Mr. Bartlett. So all the reports that I have seen of these 
contract problems, none of those are in either one of our 
categories of contracts?
    Secretary Estevez. You know, Congressman, I hesitate to go 
backward in time. Obviously, in the early parts of the last 
decade, as we embarked on the war in Iraq and Afghanistan, we 
were not prepared to manage the contracts and contractors the 
way that we should have been, and that is a fact. But the 
processes that we have put in place over the last 5 years or so 
should preclude that.
    Now, there is, you know, obviously, bad people out there 
that commit fraud. I think we have been pretty good in 
capturing that, but I always hesitate to say that every 
loophole has been closed. We actively work to stop that, 
however.
    Mr. Bartlett. Would you say that more of the problems that 
we had occurred in the OCS activities or in the contingency 
contracting activities?
    Secretary Estevez. OCS activities oversee contingency 
contracting activities, so it is one and the same.
    Mr. Bartlett. So more of them would have occurred in the 
OCS?
    Secretary Estevez. Well, OCS is the process by which we 
oversee contingency contracting. So, for us, it is one and the 
same.
    Mr. Bartlett. In the brief that we had for the hearing, we 
were told there were two basic types of contracting: the 
operational contract support and contingency contracting. 
Contingency contracting was mainly that contracting in direct 
support of the warfighter; that the operational contract 
support was, I guess, largely, what, getting supplies and stuff 
to the--we were misinformed in our brief?
    Secretary Estevez. I can't address that. But I can say that 
contingency contracting is the contracting we do to support our 
warfighters deployed on the battlefield. Operational contract 
support is the process that we put in place to oversee how we 
do that.
    Mr. Bartlett. Oh, okay. Okay.
    Well, what about the--okay, do you include in that the 
contracts to get the materials to our people? Is that direct 
support of the contractors, or is that another contracting 
category?
    Secretary Estevez. Depends on what the question, frankly, 
is--everything in our large enterprise. If we are buying things 
in direct support of our combat activities, such as fuel or 
food on the battlefield, we would rope that into the 
operational contract support environment, even though those 
purchases are being done back here.
    Mr. Bartlett. Thank you, Mr. Chairman. I yield back.
    The Chairman. Thank you.
    Ms. Davis.
    Mrs. Davis. Thank you, Mr. Chairman.
    And thank you all for being here.
    Now, as you have gone through a number of these areas, I 
think some of it falls into a category that we might call 
common sense. I mean, obviously, you need to plan, you need to 
have data, you need to have oversight. And yet I guess to 
someone just, you know, listening in on that, they would say, 
``Well, yeah.'' I mean, what gets in the way of those good 
practices?
    And I wonder if you could talk a little bit more about the 
different kinds of contracting then and where that becomes a 
greater problem. Because if it is related to the warfighter and 
contingency operations, I would think in many cases that is a 
difficulty, as I think you have expressed, of planning. You 
don't necessarily know what your situation is going to be until 
you are in the middle of it. And on the other hand, if you are 
talking about operational, it would seem to me that there is 
enough standardization in that that you shouldn't have to go 
back to the drawing board every time.
    So, you know, can you help--what gets in the way of those 
different areas, that we are not able to, I guess, accomplish 
what we really want to do?
    Mr. Schwartz. I think there are a number of issues that you 
raise, and it is an excellent question.
    One of the challenges that has occurred in Afghanistan is 
that there is a frequent rotation among personnel, uniformed 
personnel, as well as contractors, as well as civilian 
personnel. And so often someone who gets to theater who has 
never engaged in the counterinsurgency operation, which 
Afghanistan had, the policy now being pursued there, it takes 
them a learning curve, and they say, ``Oh, I get it, I see what 
is going on, and now I am 3 months from going home.'' And then 
someone else comes in who may not have had that learning curve.
    That definitely has an impact on the ability for continuity 
in some of these commonsense issues. For example, contracting 
in wartime is fundamentally different than contracting in 
peacetime. So someone who has done contracting for years and 
years here to build a road is thinking cost, schedule, 
performance. When they get to Afghanistan, in the beginning 
they are thinking, perhaps, cost, schedule, and performance--
and wait, stealing the goods. We can't take them to court. What 
effect is this having on the local village? And when they start 
getting up to speed, as I mentioned, they start rotating back. 
That is one problem.
    Mrs. Davis. Uh-huh.
    Mr. Schwartz. A second problem is sometimes you have 
personnel who, because of the rotational policy, don't have the 
experience in that area. When I was in Afghanistan last summer, 
a former helo pilot was working on contracting strategy. He had 
never done that before. Incredibly talented individual, but it 
took him also some time to get up to speed.
    So I think that is one factor that makes a difference. I 
think the other factor sometimes is just simply exposure to the 
magnitude of what one might be dealing with. For example----
    Mrs. Davis. I guess, so where--are there, then--because you 
talked about, there are gaps in data and in that collection 
process. How do you mitigate these issues, which are--again, 
they are obvious. There is a certain level of uncertainty that 
you can't necessarily plan for. What is the best way of getting 
around that, if that is the issue?
    The other thing that I just wanted to see if you had some 
thoughts on, do we have a sense--I mean, what does the cost of 
unpreparedness and the lack of planning have? Has anybody tried 
to quantify that? And particularly to the extent that we 
obviously need to do better planning, and there is a cost to 
that as well. So where is that balance, and what do we think 
that is? I mean, is that 10 percent of the budget? Is that 3 
percent of the budget?
    So the first one, how do you get around those issues that 
you have mentioned that are obviously difficult to plan for?
    Mr. Schwartz. Let me address just the data. Would you like 
me to respond to that one?
    Mrs. Davis. Yeah.
    Mr. Schwartz. So I think there are a couple of strategies 
that have been suggested that could assist. One is, what has 
happened often in Afghanistan is you have somebody collecting 
data but they don't know how to get it into the system because, 
for example, the CIDNE [Combined Information Data Network 
Exchange] system, the system that is being used in Afghanistan, 
they are not familiar with, or the user interface hasn't been 
done in a way that someone who isn't experienced in programming 
is necessarily capable of using it effectively.
    In that area, training and education can make a substantial 
difference, as well as better transition from one rotation to 
another because sometimes the person that is gathering the data 
has the book on the shelf and the next person didn't know it 
was there.
    Mrs. Davis. Uh-huh.
    Mr. Schwartz. So that is one example.
    The second example is making it important. Sometimes the 
contracting officers just don't realize, because they have many 
priorities and have many other responsibilities, the impact of 
the data.
    And I will give one example. When fuel is being delivered, 
to what extent are they measuring the fuel that is being 
delivered? That is how you are going to see how much is being 
stolen. Now, in one truck, that may not be as relevant, but 
systemically through the battlefield, fuel not being delivered 
and being siphoned off starts having substantial impact.
    Mrs. Davis. Thank you.
    And can you just indicate to me with a hand, do you have a 
sense of what the costs of this unpreparedness have been? 
Anybody have a sense of that?
    Mr. DiNapoli. No, I don't think there is a number 
associated
    But I would like to go back and kind of build on the 
discussion that Moshe was talking about. When you look, 
especially now in Afghanistan as we are drawing down and having 
our forces think about consolidating our bases, this is time 
that we should learn from our lessons in Iraq.
    About this 27-month-period out, we were really unprepared 
in Iraq to think about what our requirements were. And so we 
tasked the contracting folks in Iraq to come up with those 
requirements, and that was the wrong thing to do. What we 
needed to do was to ask our warfighters, our base commanders, 
what are the services that we need, who are the contractors 
that are performing it, and obtain the data and information 
needed so that we can figure out what our next drawdown plan 
is, so we can figure out what to do.
    That is what we need to do in Afghanistan.
    Mrs. Davis. Thank you.
    The Chairman. Thank you.
    Mr. Wittman.
    Mr. Wittman. Thank you, Mr. Chairman.
    Gentlemen, thank you so much for joining us today, and 
thank you for your service to our Nation.
    We have heard some themes here about how dynamic the 
environment is out there, whether it is drawdown in 
Afghanistan, whether it is looking at pending sequestration. I 
think it is a very interesting and challenging time for this 
Nation.
    That being said, General Crenshaw, I want to drill down a 
little bit more concerning where we are in Afghanistan, as we 
are in that downsizing in Afghanistan and we are looking at how 
we currently oversee contractors in Afghanistan, how DOD 
oversees contractors.
    As the drawdown happens, how will that oversight continue? 
Will there be enough personnel in theater to make sure that 
oversight continues? And how might oversight change through 
this transition?
    General Crenshaw. Sir, during this drawdown here, we are 
looking at, certainly, the lessons learned from the Iraq 
transition. And that has been extremely, extremely helpful. 
U.S. 4-A has already begun planning the drawdown of their 
forces, and really to include the contractors and their 
equipment.
    One other thing that is being done is that they have 
established an operation contract support drawdown sale. And, 
again, this takes into account all the lessons learned from 
Iraq. They have asked for a transition working group, where 
they show how the same type of process where DOD and DOS 
[Department of State] did a transition in Iraq--they asked for 
a working group that is really going to address those elements, 
as well.
    And so I guess, really, the bottom line is that we are 
looking at the lessons learned from Iraq, a lot of good lessons 
learned. And we have established processes that are going to 
allow us, hopefully, certainly not to have the same type of 
issues as before.
    Secretary Estevez. Congressman, if I could just jump in on 
that?
    Mr. Wittman. Please.
    Secretary Estevez. As General Crenshaw just said, we are 
deploying a one-star flag officer, who is currently the 
Director of International Operations for DCMA [Defense Contract 
Management Agency], who has extensive experience in this, to 
oversee that drawdown sale, separate from the one-star that is 
there to lead our contracting efforts, just for focusing on 
that very thing. Again, lesson learned from Iraq on how we do 
that.
    Mr. Wittman. Thank you.
    Secretary Estevez, let me expand a little bit further and 
get you to give us your perspective on where the challenges 
will be for both DOD and the contractors as we transition out 
of Afghanistan, as our strategy moves toward the Asia-Pacific.
    And also looking in that environment, what do you see the 
contracting environment being like over the next, let's say, 
10-year period as we look at, obviously, challenging economic 
times, with budgets being austere, and looking at making some 
difficult decisions about resources in the area of national 
defense?
    If you can kind of give me your perspective both in that 
transition and then, looking down the road, what do you think 
that environment will be.
    Secretary Estevez. In Afghanistan for the transition, in 
the near term there is going to remain a robust contractor 
workforce on the battlefield even as the force draws down. They 
will be doing those base life supports and, you know, operating 
some of our high-end devices like the aerostats that we have 
that provide persistent surveillance.
    It doesn't matter whether we have 10 U.S. soldiers or 
68,000 U.S. soldiers, we need those type of devices, and 
contractors are in place to operate them. And then, as we start 
closing bases, those people will deploy. So that will ramp down 
over the next 2 years, but it will stay pretty high-level for 
the foreseeable future.
    I'll go back to the question that Congressman Smith asked, 
how do we get the maximum out of our dollars that we spend, and 
as we close down Afghanistan and move out to the Pacific, we 
need to retain those types of capabilities. When we go into a 
deployed environment, we need to ensure that we are bringing 
forward those lessons that we have learned.
    You know, if you asked me where we are on operational 
contract support, I would say, you know, 5 years ago we had a 
gaping wound, self-inflicted as it may be. We staunched the 
bleeding, we sutured it up, the scar tissue is healing, but 
what we haven't done is embedded it in the DNA and in the 
muscle memory. That is what we are striving to do, and that is 
what we must succeed in doing in order to have a swing to the 
Pacific, or anywhere else in the world for that matter. And I 
think we are on the course to do that.
    Mr. Wittman. Very good.
    Thank you, Mr. Chairman. I yield back.
    The Chairman. Thank you.
    Mr. Barber.
    Mr. Barber. Thank you, Mr. Chairman.
    And thank you to our witnesses for being here today.
    I want to commend the Department for what is obviously an 
incredible effort to change contracting policy, evaluation, and 
effectiveness.
    But there was a lot said this morning about cultural change 
that is needed. Particularly, Mr. Schwartz and Mr. DiNapoli, 
you have spoken to that. It is a very vague term, I guess. You 
could apply it to any system, any bureaucracy.
    Could you provide us with some indicators of what cultural 
change needs to be and how we might evaluate it?
    I agree with your premise that we need to have data in 
order to make good decisions. We also need to have smart people 
making use of that data.
    So could you explain, what are the barriers, specifically, 
as you understand them, to cultural change? And how do we 
measure movement toward cultural change that will make 
ourselves more effective and efficient in this area?
    Mr. DiNapoli. That is an excellent question.
    When you think about cultural changes, it is a big concept. 
And how do you bring about cultural change? You know, the work 
that we have done in past says it is a long-term process of 5 
years or more. Probably in this area, with regard to 
contracting, it is going to be longer than that.
    With regard to operational contracting, one of the barriers 
is that folks in the field don't really appreciate contracting 
as that enabling capability. And so you do need to get them to 
have a better appreciation of the role that contractors play in 
support of their mission. And so that does come back to the 
education and training part that we have so that individuals 
will even recognize that.
    So when you think about it from, as you talked, at the 
operational level, DOD is setting policy that is trying to set 
that vision at the Department level, and now it needs to be 
translated down. You go to the operational command or the 
operational planning would be the next step, then down to the 
military department, and then down to individual units and 
individuals.
    So I think it is a long-term process. I think the measures 
of effectiveness still need to be developed, and the Department 
has an action plan. We would like to see how those measures are 
better developed in that plan so they can gauge for themselves 
how much progress they have made, where they need to go, where 
the emphasis needs to be.
    Secretary Estevez. If I could jump in there, Congressman?
    Mr. Barber. Well, I just want to commend you on your 
medical analogy. I liked it. And perhaps that will speak to how 
we can make some cultural change, as well.
    Secretary Estevez. And it is, frankly.
    Now, as Mr. DiNapoli said, it needs to be recognized as an 
enabling capability, just like logistics is an enabling 
capability to winning a warfight. So the warfighter needs 
people behind them.
    Contracting is commanders' business. It is not just for the 
contracting officer. And that needs to be embedded. So today in 
Afghanistan, General Allen puts out guidance related to 
management of contracts and contracting because it is part of 
his effort to win that fight in Afghanistan.
    That needs to go into our military education process and 
our civilian education process related to military, in fact. 
And that is what we are working to do, is embed that in 
courseware so, as today junior officers go through their paces 
as they grow into senior officers, that becomes part of their 
process: ``When I deploy, I am going to have contractors with 
me. Contractors can help me win the fight or they can impede 
me. I need to manage them to help me win the fight.''
    And once that thought process becomes second nature, the 
fact that Dr. Carter or General Dempsey is saying that today, 
which they are, you know, ``They are transitory, I am 
transitory,'' where you need to have that into the workforce, 
into the military force for the future.
    Mr. Barber. Thank you.
    Mr. Schwartz. And if I may add, of course it is difficult 
to measure culture, but there are some, perhaps, flags that one 
can look for to see how progress is being made.
    One is when contracting officer representatives are being 
tagged by senior officers, are they the people that are very 
well-respected in the unit or not? In the Gansler report the 
Army commissioned a few years ago, one of the concerns was that 
it is the people who aren't well-respected who are being 
appointed as the contracting officer representatives.
    Another one is, to what extent is everybody talking about 
the role of contractors as part of the total force? To what 
extent is it in the QDR [Quadrennial Defense Review]? To what 
extent is it in doctrine? To what extent is it in the 
discussion?
    And the last would be--and this is clearly not a measure 
that is easy, but the anecdote I heard which I found very 
useful was in Iraq, when people first got there, the general 
question was, where are our guys, where are the bad guys, and 
what land do I control, what is my mission? Today, more people 
are asking, where are our guys, where are the bad guys, what is 
my mission, and where are our contractors?
    Sometimes just asking that question and having that in the 
consciousness is the example of how culture has changed. And to 
the extent that culture has changed as a result of the 10 years 
of experience, 12 years of experience we had, perhaps one of 
the largest challenges for the Department of Defense is 
maintaining and encouraging further culture change so we don't 
lose the experience and the changes and the progress that we 
have made so far.
    Mr. Barber. Thank you.
    Mr. Chairman, I yield back.
    The Chairman. Thank you.
    Mr. Coffman.
    Mr. Coffman. Thank you, Mr. Chairman.
    I think my first question would be, how many contractors--
or is anybody aware of how many contractors we have in Iraq 
today?
    Secretary Estevez. Iraq, today, end-of-third-quarter number 
is about 7,300 DOD contractors.
    Mr. Coffman. Seventy-three hundred. And what kind of 
missions are they performing at this time?
    Secretary Estevez. They are still doing some base support, 
delivery of food and fuel, some private security, you know, 
some security missions.
    Mr. Coffman. Okay. And then how many contractors do we have 
in Afghanistan today?
    Secretary Estevez. Afghanistan is about 114,000 
contractors. And there is a whole range of missions that they 
are doing, including base support, linguistics, operating the 
things that I was talking about earlier--aerostats, persistent-
surveillance-type devices--performing maintenance, a whole 
schema of activities.
    Mr. Coffman. So if I understand it, I think we are drawing 
down now to about 80,000 U.S. military personnel. Is that the 
number?
    Secretary Estevez. Sixty-eight thousand.
    Mr. Coffman. Oh, 68,000 U.S. military personnel? And we 
have 114,000 contractors?
    Secretary Estevez. Yes.
    Mr. Coffman. And then, so as we draw down, then, through 
2014, could you tell me, do we have any idea what that will 
look like at the end of 2014 yet?
    Secretary Estevez. At the end of 2014, it depends on what 
force is left there, you know, working with the Afghans and 
whatever the training mission evolves to be at that time. We 
don't know what that number is. If it is zero, you know, our 
contractor number will be pretty small, you know, working with 
State Department.
    Mr. Coffman. So how would you break up the contractors 
between DOD and State Department?
    Secretary Estevez. I don't have the State Department 
numbers. I have DOD numbers.
    Mr. Coffman. Okay. Does anybody have, is anyone aware of 
the State Department numbers?
    Mr. Schwartz. I don't have the State Department numbers, 
but I think I could add a little bit of clarity to the current 
contractors now.
    Mr. Coffman. Sure.
    Mr. Schwartz. Approximately, there are about 28,000 private 
security contractors currently being used by the Department of 
Defense in Afghanistan.
    Mr. Coffman. Okay.
    Mr. Schwartz. With the migration to APPF [Afghan Public 
Protection Force], that number, assuming that that migration 
takes place, should be go down substantially.
    Of the rest, of the other 75 percent of the DOD contractors 
being used in Afghanistan, based on the experience in Iraq and 
the other data that has been put out, the majority of those are 
definitely doing base support.
    So, to the extent that a drawdown also draws down base 
support requirements, there should be a substantial withdrawal 
of contractors for that, as well.
    Mr. Coffman. Okay.
    The security situation--I know President Karzai has 
complained about contract security and wanted, I think, that 
relationship terminated, to some extent, and provided 
government security. Can anybody give me some visibility or 
some clarity on that, on where we are right now? What did the 
President want, Karzai want?
    Secretary Estevez. The President wanted a transition from 
companies hiring their own private securities from other 
companies, which could lead to small armies, if you would, to 
an Afghan national security force, APPF, as Mr. Schwartz 
alluded to.
    That program is in process. It is being done initially for 
what we call mobile security--think convoys--support, which is 
mostly private companies delivering goods for us with security 
against that, not our own conveys. We protect our own convoys. 
And we have another year to go before it transitions for base 
support. And, again, the Afghans have been flexible as that 
capability evolves.
    Mr. Coffman. Okay.
    Mr. Chairman, I yield back.
    The Chairman. Thank you.
    Ms. Speier.
    Ms. Speier. Thank you, Mr. Chairman.
    Thank you all for your participation today.
    My colleague just made a very important point, which is 
that we have almost twice as many contractors in Afghanistan as 
we have service members there. And that has historically been 
our experience in Iraq, as well, when we were still fully 
engaged there, if I recall correctly, certainly more 
contractors than we have service members.
    So it becomes very clear that in any engagement that we are 
in moving forward, it appears that Defense has ceded that 
contractors will be a large part of our engagement anywhere, in 
fact, much more so than our military presence. Would you agree 
with that generally?
    Secretary Estevez. In Iraq and Afghanistan, generally we 
are about 1.1 contractor to 1 military, so it is almost a 1-to-
1. We are a little higher than that now because of the 
drawdown. But I absolutely agree with your premise, that we are 
going to be out there with contractors.
    Ms. Speier. So, knowing that and knowing that the Wartime 
Contracting Commission has already said that we have failed in 
managing these contracts and the cost has been estimated to be 
$60 billion, we have to get our act together, correct?
    With that mind, it is my understanding that--and this is to 
you, Mr. Estevez--it seems like the rotation for our 
acquisition professionals are too short for them to have a good 
sense of the operational environment and really to take 
ownership of the programs that they are overseeing.
    To what extent is the Department considering extending the 
length of these rotations?
    Secretary Estevez. I think we need, you know, to separate 
rotations of program managers that are overseeing the buying of 
stuff from rotations of contractor oversight and contracting 
management into theater.
    The general officers and their staffs that we are putting 
into theater now go on a year rotation. As we bring back our 
dwell time, it might be a 9-month rotation. But they are there 
for, just like the combat forces, for a period of time. And 
they have sustaining staff underneath them. So we have the 
capability there today to oversee it.
    You know, your point on the Commission on Wartime 
Contracting, agreed. Yeah, we are not where we needed to be, 
looking into the past. But we believe we are today on the right 
timeline in Afghanistan. And, again, it is sustaining that into 
the future that we need to look to.
    Ms. Speier. So when we send our soldiers to war, we teach 
them how to use a gun. We send our officers and staff, and yet, 
do we train them in terms of acquisition management? Is there 
any requirement that service members have that kind of 
training? I mean, we are talking about huge sums of money.
    Secretary Estevez. So, the corps of contracting officers 
are absolutely trained, and the military acquisition 
professionals are absolutely trained in those arts. And we are 
increasing the cadre of that able to do that.
    When you go further down, contracting officer 
representatives, that is going to be someone from a combat 
unit. And we are training them today, as they deploy, on how to 
oversee those contracts as part of their standard training. And 
that has been emphasized at the senior level in the Army and 
the Marine Corps, who are the preponderance of forces.
    Ms. Speier. Mr. Schwartz, how do we measure whether or not 
the Department is doing a better job in terms of managing the 
contractors moving forward? How do we deal with an evaluation 
of whether or not we have reduced the $60 billion in tax 
dollars that have been wasted through improper contracting? 
What would you recommend that we be looking at?
    Mr. Schwartz. One example might be, in 2010, DOD set up 
Task Force 2010. The goal of Task Force 2010 was to assist in 
contracting as well as to start looking at who we are 
contracting with in Afghanistan. As a result of Task Force 
2010, tens of millions of dollars of goods have been recovered 
that were stolen, items are being tracked better, there is more 
sharing of information of how to do things, and there has been 
a substantial increase in the companies and individuals who 
have been suspended and debarred. That was established in 2010.
    One measure would be how quickly next time. Or in exercises 
or in planning documents or in education, there is discussion 
on getting that done day one, you know, or the second day that 
you are on the ground. How long it takes to start setting up a 
Shafafiyat, for example, that was looking into corruption 
issues, to a degree, in contracting or a spotlight on--and the 
ACOD [Armed Contractor Oversight Division], which was 
overlooking the use of private security contractors.
    A second way to look at this would also be the extent to 
which contracting issues--and I don't mean actually just 
writing the contract--the whole value chain of figuring out 
what contractors are going to be doing, how they are going to 
be doing it, and how you manage that. In addition to the extent 
that they are in educational courses and in addition to the 
extent to which they are in the military exercises would also 
be the extent to which coordination is being done with other 
agencies when there are joint operations.
    And I will give you an anecdote. When I was in Iraq about 
5----
    The Chairman. The gentlelady's time has expired.
    Mr. Schwartz. My apologies.
    Ms. Speier. Mr. Chairman, may I just ask that he prepare a 
document with his answer and provide it to you and to me?
    The Chairman. If the gentleman could please give the answer 
for the record?
    Mr. Schwartz. Of course.
    [The information referred to can be found in the Appendix 
on page 97.]
    The Chairman. Mr. Scott.
    Mr. Scott. Thank you, Mr. Chairman.
    And I have a couple of comments that deal--or questions, I 
should say--that deal primarily with the equipment that will be 
coming back from Afghanistan and Iraq. We were in Kuwait a few 
months ago, and obviously there is a tremendous amount of 
equipment there that will be shipped back to the U.S.
    And I guess my question has to do with our capacity on base 
and what will happen with the equipment when it comes back, as 
far as getting that equipment back in working order and 
determining whether it should be scrapped or repaired.
    Secretary Estevez. We have a process to do that. Obviously, 
if it is there and it is in need for forces or, you know, 
backup for damaged/destroyed equipment, it is going to remain 
there until such time as it is ready to redeploy.
    As units redeploy, we are bringing back their equipment. We 
are removing excess equipment from Afghanistan today as we 
speak, and they are tracking that on a regular basis.
    Mr. Scott. Sure.
    Secretary Estevez. And if it is needed for future forces, 
it will go in through depot and be repaired and then go back to 
the forces. If it is not and we know it is not today, our 
tendency will be to destroy it or leave it in Afghanistan or 
donate it to someone in Afghanistan.
    Mr. Scott. Well, one----
    Secretary Estevez. If it--if I could----
    Mr. Scott. Sure.
    Secretary Estevez. And there is a mix of things that we are 
not quite sure, and we will bring those things back and park 
them and figure out what the future forward construct might 
look like.
    Mr. Scott. Sure. Okay.
    The reason I ask is I am from Georgia. We have several 
depots there, and we have the Savannah port, as well. And, 
obviously, a lot of that equipment will be coming into Georgia. 
And I will give you a number and we can talk further about this 
at your convenience, about a suggestion that I have that maybe 
the Department hasn't looked at yet. But I will move on to 
another subject matter for now.
    One of the things that sticks in my mind with a recent trip 
to Afghanistan is a young soldier who spoke to me. She was an 
air traffic control officer, and she spoke to me about what the 
contractor that sat literally next to her in the chair was paid 
versus her pay. And it was simple things like access to 
Internet anytime the contractor wanted it, when our soldiers 
didn't have some of those same conveniences.
    And my question gets back to, what are you hearing from our 
soldiers that are out there, like that young air traffic 
control officer who is having to sit next to a contractor that 
may be getting paid two or three times what the soldier is and 
that contractor having, if you will, more of the things that we 
enjoy in America than some of our soldiers do?
    General Crenshaw. Sir, in regards to that question, as we 
have the opportunity to talk to our soldiers, our marines, you 
know, our service members, it becomes the motivation factor, in 
terms of what are our soldiers--what are they there for, what 
is their motivation for being in uniform. And, certainly, there 
are some differences in terms of what a contractor has access 
to.
    Our service members, I think, are very proud of what they 
are doing, and they recognize the important role that they 
play. And I think, at the end of the day, they do recognize 
that they are at a higher calling and that they really enjoy 
what they do and, at this point, are willing to accept and 
recognize that they are service members. And when they have the 
opportunity to be back in the States and have those things, 
they will enjoy having them then. But I think, at the end of 
the day, good soldiers doing good work for our military, for 
our country.
    Mr. Scott. Sure. And the person wasn't whining, by any 
stretch of the imagination. They were proud to be there, proud 
of their service to the country, as well. It was a constituent 
of mine. It wasn't so much the pay as it was, you know, if 
Internet access can be provided so that the contractors can 
talk to their families whenever they want to, you know, isn't 
that something that could be done for us, as well?
    So my time is almost expired, but thank you for that 
answer, and just something to keep in mind as we go forward.
    I yield back.
    The Chairman. Thank you.
    Mr. West.
    Mr. West. Thank you, Mr. Chairman and Ranking Member.
    And I want to talk, you know, basically from my own 
experiences because I may be one of the few people here that 
spent 22 years in uniform and 2\1/2\ years as a contractor in 
Afghanistan.
    What I saw that works is the relationship where there is a 
unity of command and a unity of effort. You know, when I was 
there as a battalion commander and I had the contractors, they 
were in my unit, and they were responsive and responsible for 
me.
    And when I went back over to Afghanistan, I was part of an 
Active Duty unit's staff, and I reported to them, and there was 
not that enmity that my colleague just talked about because we 
lived, slept, and worked and ate side-by-side with them. We 
were not allowed to have weapons, but yet we were going out on 
patrols with them just the same. And I think that that helped 
to gain a lot of respect from the men and women in uniform.
    So I guess my lesson learned, if I can share, is that we 
have to make sure that there is no separations in effort 
between what the contractors are doing and what the uniformed 
service members are doing. And if we can make sure that we 
continue to have that close relationship--my contractors 
trained with me at NTC [National Training Center] before we 
deployed over to Iraq in 2003. So I will recommend that that is 
a great way to help, as we move forward.
    Now, the question that I have is, in 2003 we had a really 
tough time as far as understanding what were the things that 
were needed on the ground. And we had initiatives that were 
started, like the rapid force, the fielding initiative.
    What have we learned as far as that Rapid Fielding 
Initiative now? And how can we make sure that we have better 
streamlined processes and procedures to be able to get the 
requirements from the guys down there at the tactical level up 
as soon as possible to the CORs [Contracting Officer's 
Representative] and get them the type of equipment that is 
needed?
    Secretary Estevez. If I could, let me take that, 
Congressman.
    And I won't even say it is getting into the CORs. It is 
getting it back up the chain to the right person who can buy 
what it is that they need.
    We have honed the JUONS [Joint Urgent Operational Needs 
Statement] process, the process by which those rapid emerging 
requirements come up. About 2\1/2\ years ago, Dr. Carter, when 
he was the Under Secretary, was asked by Secretary Gates, at 
the time, to lead an effort to manage those JUONS as they come 
in, which seem to be programming requests, to meet those things 
that have come through.
    And it is all focused on getting those things rapidly what 
we know we can buy and put out on the battlefield within the 
year, in general. That is how all those persistent surveillance 
devices have gone out there, new devices like handheld scanners 
for IEDs on the ground, ballistic underwear, all sorts of great 
things.
    Dr. Carter chairs that group now, even as the deputy, every 
3, 4 weeks--he was doing it biweekly--on the video with General 
Allen's staff in Afghanistan, talking about what they need; 
what is in the pipe; how can we expedite that; putting our 
contracting effort, whether it is on the ground in Afghanistan 
or back here, in order to buy soldiers, sailors, airmen, and 
marines what they need today in a rapid fashion.
    Mr. West. Anyone else?
    The other thing I think we have heard a lot of questions 
about, the waste of funds. How have we improved our 
reconciliation process to make sure that we are not wasting 
funds and we have a good accountability of the American 
taxpayer dollar in these combat zones?
    Mr. DiNapoli. We did a report last year that looked at the 
closeout process, the DOD contracts in Iraq and Afghanistan. 
And we found that there still remains a huge number of 
contracts that need to be closed out, in part because of poor 
contracting, poor recordkeeping, poor contract administration.
    So the numbers are fairly significant in both our cost-type 
and fixed-price-type contracts. I think for the cost-type 
contracts, the Defense Contract Audit Agency, with increased 
staffing, has just announced a new initiative to take a look at 
some risk-based approaches to kind of reduce the backlog of 
incurred costs in contract closeout activities. We are 
currently viewing that activity and hope to issue a report 
later in December.
    But I think the Department has a long way to go to having 
the systems in place that would allow them to do a timely 
fashion closeout. The key for Afghanistan, which is an issue 
that is still emerging, is to make sure right from the 
beginning that we have good contract administration and good 
oversight of those contracts so the reconciliation process is 
not challenging. It should be fairly simple if we pay attention 
during the course of the contract.
    Mr. West. Okay.
    Secretary Estevez. I would agree with Mr. DiNapoli on that. 
It is part of the overall OCS construct, putting good 
contracting in to place, putting oversight--you know, we have 
DCMA deployed in force out on the battlefield today; that was 
not true in the past--and then keeping that process through 
contract closeout, which will take years in this case.
    Mr. West. Thank you, Mr. Chairman.
    I yield back.
    The Chairman. Thank you.
    Mr. Platts.
    Mr. Platts. Thank you, Mr. Chairman.
    I thank all the witnesses for being here. And I apologize--
I was coming from another hearing--if I am repetitive.
    I want to focus on the issue of Afghanistan, specifically. 
And my most recent trip, back in June, was my 10th visit there. 
And each time I have come back, one of my biggest concerns is 
just corruption in Afghanistan, within the Afghanistan 
Government and then with, you know, vendors that we are dealing 
with, non-U.S. vendors.
    And I know there is an initiative with the vetting of non-
U.S. vendors. Specifically, I guess, two questions. My 
understanding is that we are not vetting vendors that are under 
$100,000, and we are not vetting subcontract vendors even if 
they are over $100,000.
    And, Mr. Secretary, am I correct in my understanding? And, 
if so, why aren't we, especially when it is also my 
understanding that a large majority of our non-U.S. vendors 
fall into this category of under $100,000?
    Secretary Estevez. I am sorry, I don't know the limits on 
what we are doing. I do know we are looking at, from a 
corruption standpoint, under Task Force 2010 is looking at a 
plethora of contracts, including the subcontracts that are 
underneath the contracts and who those people are and what they 
are doing.
    In fact, this Congress gave us, in the last NDAA [National 
Defense Authorization Act], authority to do that at the 
subcontract level. They are identifying bad people, and we are 
knocking them out. And that was another authority that you gave 
us last year.
    Mr. Platts. And I know there is more focus on it. And I 
don't know if it is a manpower issue, that we are still not 
vetting all, and then also not coordinating between DOD, 
Department of State, USAID in the vetting process. Are you 
familiar with that lack of coordination?
    Secretary Estevez. State has its own contracting, USAID has 
its own contracting. In the areas where we overlap, there is 
good, strong coordination. So I can't address their processes 
outside of where they work with us.
    On the larger vetting question and what the numbers are, if 
you don't mind, I will get you a response for the record on 
that.
    Mr. Platts. Yeah, if you could. And also for the record, 
what, if any, coordination is occurring? Because we are in the 
same theater and maybe State, maybe DOD, USAID, but if we vet 
somebody and say ``bad apple, related to organized crime, 
insurgents,'' you know, we want to make sure we are sharing 
that with our colleagues, which it is my understanding we are 
not doing very well right now.
    Secretary Estevez. If someone gets, you know, to the point 
of suspension and debarment, that goes for the Federal 
Government-wide, so that is clean.
    So, again, I will get you a full response in this area.
    [The information referred to can be found in the Appendix 
on page 97.]
    Mr. Platts. And a final question is, it is my understanding 
that the Secretary of Defense and the Secretary of State have 
recommended the formation of an illegal activities initiative 
for Afghanistan with Justice, similar to what we have done in 
North Korea.
    Are any of you familiar with that issue and that 
recommendation?
    No?
    Mr. DiNapoli. Congressman, I am not familiar with that 
recommendation, but I do want to go back to your point about 
vetting.
    I think the issues you identified were spot-on. And we did 
a report, I believe last year, that looked at the vendor 
vetting process, and we did identify weaknesses in both DOD, 
State, and USAID's process for the vetting process.
    So trying to--for DOD, absolutely, they weren't vetting 
contractors under $100,000, weren't vetting subcontractors. 
They were vetting contractors already on board, as opposed to 
vetting contractors that were prospective. So it was kind of 
after-the-fact vetting.
    So those issues, I think, they are still in the process of 
addressing. I don't believe that they have they fully 
reconciled those. And interagency coordination remains a 
problem.
    Mr. Platts. Did your study identify, was it a manpower 
issue, that they just didn't have the resources to do a full 
vetting of all of those contractors, or were there other 
factors?
    Mr. DiNapoli. It was a combination of factors. One is at 
the guidance level. I mean, there is guidance that suggested 
that we should do certain things, but it needed to be more 
clearly spelled out. And we made a recommendation to do that, 
and I think DOD did act upon that.
    But I think there are limitations in the resources 
available, both at the contracting officer level, at the shop 
that does the vetting down in Tampa. So I think there were 
resource constraints. And the number and volume of contracting 
actions that are supposed to be vetted through that shop 
greatly exceed, I think, what their expectation was.
    So I think there were a number of combinations.
    Mr. Platts. Yes?
    Mr. Schwartz. If I may add, one of the primary obstacles 
was personnel. And there was a path to substantially increase 
the number of people who were doing the vetting, particularly 
in a reach-back back to CENTCOM [U.S. Central Command] in 
Tampa. That was one issue that they were working to address.
    At the same time, they were setting up a vendor vetting 
cell through ISAF [International Security Assistance Force], 
through the NATO [North Atlantic Treaty Organization] allied 
forces, as well, to complement each other and to coordinate.
    And, third, there were instances, based on a high-risk 
analysis, where they were vetting subcontractors. And the 
example I would throw out is private security contractors for 
the Afghan national trucking contract because of the high-
profile and the critical nature of that. So they did attempt to 
do some sort of triage with subcontractors when they felt the 
risk justified it.
    Mr. Platts. Okay.
    Again, thank each of you for your testimony here today, 
and, General Crenshaw, especially your lengthy service to our 
Nation in uniform. We are a blessed Nation because of heroes 
such as yourself who are serving us.
    Thank you.
    The Chairman. Thank you.
    Mr. Conaway.
    Mr. Conaway. Thank you, Mr. Chairman.
    And gentlemen, thanks.
    General Crenshaw, can we dig down a little deeper in the 
training aspect? You and Mr. Estevez both said that we train on 
a commander level when he or she takes command.
    How are they trained with respect to what their 
responsibility will be for contractors in their area? I mean, 
is it a systemic training that all folks go through as a part 
of staff training moving up to command? Or is it specifically 
just a handoff training from one commander to the next? What 
are we doing with commanders?
    General Crenshaw. Yes, sir. The training at this point is 
very deliberate, sir. The training is for, at this point, got 
it for commanders, we got it for the field-grade level, and we 
have it for the actual planners. And what we utilize is the 
Defense Acquisition University to conduct part of the training, 
particularly the core training. The Army Logistics University, 
as well, conducts training.
    So you have a series of venues or institutions, if you 
will, that will actually conduct the training for the various 
levels, to include, at the junior-officer level, at National 
Defense University, CAPSTONE offers an opportunity for the 
senior leaders to have training.
    Mr. Conaway. So there are formal courses. When someone is 
being selected to command a company or an area that is going to 
be directly supported by contractors, is that person, do they 
check to make sure that they have actually gone through those 
courses to see that we have the training in place? Is the 
personnel system adequate to make sure that folks have the 
training before they get into the theater?
    General Crenshaw. Yes, sir. The process is to identify 
those forces and commanders who are going in theater, that they 
are properly trained with the appropriate courses at the 
various level where they are.
    Mr. Conaway. Okay.
    Mr. Estevez, you mentioned you have the number of 
contractors in Afghanistan right now. Do those include the food 
service guys that are serving meals as well as guys picking up 
trash and that kind of stuff?
    Secretary Estevez. Absolutely.
    Mr. Conaway. The number gets inflated. We think that all 
117,000 of them are high-end positions. Can you give us some 
sense of nationalities for that contractor group and how many 
of them would be considered, you know, care and maintenance and 
feeding of the team that is, well, not--doesn't take a lot of 
education to serve food at the DFAC [dining facility]----
    Secretary Estevez. I can give you some general----
    Mr. Conaway. Okay.
    Secretary Estevez. Of the about 114,000 in Afghanistan 
today, about 48,000 of those are Afghan nationals.
    Mr. Conaway. Okay.
    Secretary Estevez. Again, so that is helpful to us to 
bringing Afghan prosperity.
    Mr. Conaway. Right.
    Secretary Estevez. About 30,000 U.S. citizens, and the 
remainder are third-country nationals from wherever around the 
world.
    About 36,000 of those folks, or 32 percent, are doing what 
we call LOGCAP [Logistics Civil Augmentation Program], 
logistics capability support. So those are base support guys--
picking up trash, maintaining the road on Bagram or Kandahar, 
leatherneck, serving food, those type of activities.
    Mr. Conaway. Right. Okay.
    Secretary Estevez. Another 7,000 are Corps of Engineers. 
So, again, general engineering stuff, and that could be doing 
both projects for the Afghans or projects for us.
    Eighteen percent are theater support. So, again, general 
support-type roles, and that could be delivering food, 
delivering fuel. So they are not on our post, necessarily, but 
they are counted against our numbers because they are 
contractors using the----
    Mr. Conaway. Okay.
    Secretary Estevez. And then we have 43 percent in the 
``other'' category. And that could range from high-end people 
doing high-end maintenance, logistics----
    Mr. Conaway. So it looks like 60 percent of those are just 
the normal things that you really don't want people in uniform 
doing.
    Secretary Estevez. That is correct.
    Mr. Conaway. And we could. Back when I served, a million 
years ago, we had KP duty. It was fun. And my favorite spot was 
pots and pans. You are over there by yourself; nobody messes 
with you. But we don't need guys in uniform doing pots and 
pans.
    And so 60 percent of that team is just--well, when we 
leave, we don't bring those guys with us. And there are no 
long-term commitments to that group either, right?
    Secretary Estevez. They go back to whatever they were doing 
before.
    Mr. Conaway. Okay.
    Thank you, Mr. Chairman. I yield back.
    The Chairman. Thank you.
    Mr. Palazzo.
    Mr. Palazzo. Thank you, Mr. Chairman.
    And I thank our witnesses for your testimony.
    This question is primarily for General Crenshaw and Mr. 
Estevez. And I am hoping you are familiar with this report and 
the bill that was introduced in the Congress.
    But what are your thoughts about the feasibility of 
standing up an independent United States Office for Contingency 
Operations with dual reporting to DOD and State, as some have 
suggested? And what are the benefits and drawbacks of this 
approach?
    And although we will start with Mr. Estevez, I would like 
to hear from CRS [Congressional Research Service] and others, 
as well.
    Secretary Estevez. We don't believe that that is the right 
thing to do. We believe that, you know, while we have been at 
war for the last 10 years and we expect to have some level of 
instability in the world, as demonstrated yesterday, putting a 
contingency office that may or may not have something to do out 
on the side is not the way to have a continued trained 
workforce.
    Contracting in this area is a subset of contracting in 
general. There are some specifics related to it, you know, 
speed and oversight that is required, and we should be drawing 
from our workforce in order to do that and holding people 
accountable and put in the proper oversight.
    And that applies to both the Department of Defense and--
again, I can't speak to State, but I believe that they view 
things the same way.
    General Crenshaw. Sir, if I just may add, certainly I 
concur with Secretary Estevez. The idea, though, in terms of 
spirit, I think we are addressing the spirit of a lot of the 
language and recommendations as we currently reorganize and 
focus on the new OCS concept. To the extent of having this 
different office, sir, again, I think we, in the spirit of the 
language, we are actually doing that now.
    Mr. Palazzo. Mr. Schwartz.
    Mr. Schwartz. So there definitely are varying opinions on 
that. One, of course, is, would it be integrated with DOD? They 
are opposed to that.
    One of the arguments for that, clearly, is to focus the 
issue. So I would suggest, number one, to the extent that there 
is another alternative, another way to do that that DOD 
suggests or the State Department suggests, which would be the 
more efficient way to accomplish what the ultimate end goal is, 
which is more efficient overseas contract support, OCS?
    The second is--and I think very often, particularly in this 
case, the devil would be in the details, which is it may be a 
good idea, it may not be a good idea, but how would it actually 
functionally work? And not only how would it functionally work, 
but between operations, what would that office look like? What 
influence would it have? Is it something permanent? Is it 
something that ramps up?
    And that may substantially impact the extent to which it 
may or may not be the best idea to go forward. And those are 
some of the questions I would ask.
    Mr. DiNapoli. Just to build on that, I think there are a 
number of options out there that have been proposed, and even 
each one has some pros and cons to those. I think to determine 
the lines of responsibility and kind of the roles and the 
mission in between contingencies, as well as how do you 
coordinate among the accountable organizations as a whole, is 
important.
    In Iraq and Afghanistan, we do have a coordination body 
that GAO participates in, so we do try to maximize our 
resources to provide oversight.
    And so, as we look to the future, I think ensuring 
accountability for our activities is essential. An inspector 
general, whether it be permanent, whether it be a coordinating 
body--I think options do exist. GAO, of course, is still 
available to provide assistance to the Congress as appropriate.
    So there are different ways of looking at it. It goes back 
to clearly defining roles and responsibilities in the mission.
    Mr. Palazzo. Thank you for those responses.
    I hope you all can address this. As you all know, we have 
been dealing with a serious unemployment issue over the past 
few years here in the United States. And I personally know many 
people who have gone overseas to work as Government 
contractors, many because they couldn't get solid employment 
right here in the U.S.
    Now, as we continue to draw down from our overseas 
contingency operation, many of these individuals are being let 
go or their contracts are expiring without extension. Does 
anyone have any estimates on how many Government contractors, 
which I guess are named expats, may be out of work by the end 
of our operations in Afghanistan?
    Secretary Estevez. Again, I can't say how their companies 
that they are employed with will use them. Today, between Iraq 
and Afghanistan, we have 40,000 U.S. citizens employed.
    Mr. Palazzo. Okay. And I appreciate that.
    And I would like just to point out something real quick 
with the balance of my time, is that, as these contracts aren't 
extended, you know, many of the Americans, U.S. expats that 
work overseas are receiving a foreign-earned-income exclusion. 
But you have to be over there 330 full days out of a 12-month 
period. And I am afraid that, because of the Government's 
drawdowns, that these U.S. citizens are going to be forced to 
come back and incur tens of thousands of dollars in tax 
penalties. And I wish there was a way this committee and 
perhaps this Congress can address that so they are not hit with 
an unfair tax liability.
    Thank you, and I yield back.
    The Chairman. Thank you.
    Mr. Johnson.
    Mr. Johnson. Thank you.
    Thank you, gentlemen, for being here today.
    General Crenshaw, I would like to ask you whether--well, I 
would like to ask you--it is clearly much more difficult to 
conduct oversight in a combat zone than in an area that is at 
peace. How would you advise reforming combat zone oversight to 
prevent waste, fraud, and abuse?
    General Crenshaw. Sir, this is something that we have taken 
on and really have addressed it very heavily. You know, we have 
learned from our past, and we spoke to that piece. And we have 
instituted, through doctrine, through training, through 
education, a process that allows us to better provide oversight 
during combat.
    Combat is different, and we understand that. And so our 
approach is different. We are more engaged, and we have 
different types of boards that allow us to do much more vetting 
of contractors and vendors.
    I think, again, we have gone a long way in really 
addressing some of the lessons learned from our previous 
performance in Iraq.
    Mr. Johnson. Other than vetting, have there been any other 
controls put in place to protect against waste, fraud, and 
abuse in a combat setting?
    General Crenshaw. Sir, we have a number of boards, fusion 
sales boards, that look at the vendors. And also we have our--
our Corps is better trained to go out and look onsite to see 
what type of service is being performed, is it a service we 
asked for, requested for, is that type of service being done, 
and to what level is it being done. And so we do have some 
mechanism in place just to provide the better oversight.
    And, really, when you get down to the actual, in some 
cases, the site where the work is being done, you just need 
someone there to make sure it is happening and it is being 
reported properly.
    Mr. Johnson. Well, now, General, as our forces and 
personnel are being reduced in Afghanistan, how prepared are we 
to manage the contractors who are left behind? How prepared are 
we to manage them?
    General Crenshaw. Sir, one of the things that the--what is 
being done now in Afghanistan is that U.S. 4-A has already 
started to plan the drawdown of contractors and contractor 
equipment. And so, again, this is another deliberate process.
    The forces in theater, they established different types of 
working groups that allow them to take note of all the lessons 
learned from Iraq. We have embedded personnel with Department 
of State, to a degree that Department of State may at some 
point inherit some of the contracting management.
    And so, again, all of the steps that are currently being 
taken are really a direct reflection of the lessons learned 
from the Iraq drawdown.
    Mr. Johnson. All right. Thank you.
    Mr. Estevez, a recent report found that many contractors 
employed in Iraq and Afghanistan are foreigners who--well, many 
of the contractors hire foreigners to perform the work that 
they have been contracted to do. And many times, or on noted 
occasions, there have been foreigners who have been tricked 
into working for American contractors and subcontractors who 
abuse them with impunity and subject them to grueling hours, 
meager wages, and confinement, along with deadly working 
conditions.
    Can you tell us what steps are being taken to address this 
important issue?
    Secretary Estevez. First, we have zero tolerance for 
trafficking in persons. And what we have is, first, there are 
contract laws that prohibit that, and there are severe 
penalties for doing that.
    We have auditors and Defense Contract Management Agency out 
there on the ground assessing contracts and the life of the 
contractors that are engaged there. We have regular brochures 
that are handed out to people that are operating that show who 
they can report to. If you travel around Afghanistan, you will 
see posters and the like explaining the rights of the people 
who are employed.
    But it is really on-the-ground oversight that provides the 
direct feedback. And then we would prosecute anyone that we 
found violating that.
    Mr. Johnson. Thank you.
    The Chairman. That concludes our questions for the panel. 
We thank you very much for being here, and thank you for your 
service.
    And that will end this hearing. Thank you very much. This 
hearing is adjourned.
    [Whereupon, at 11:50 a.m., the committee was adjourned.]



=======================================================================




                            A P P E N D I X

                           September 12, 2012
=======================================================================


              PREPARED STATEMENTS SUBMITTED FOR THE RECORD

                           September 12, 2012

=======================================================================

      
              Statement of Hon. Howard P. ``Buck'' McKeon

              Chairman, House Committee on Armed Services

                               Hearing on

              Operational Contract Support: Learning from

                 the Past and Preparing for the Future

                           September 12, 2012

    This morning we were reminded once more of what a dangerous 
world we live in, and the risk many Americans take to serve our 
country abroad. My thoughts and prayers--together with those of 
this committee--are with the families of those we've lost in 
Libya.
    We meet today to receive testimony on Operational Contract 
Support, that is, the services our military buys to directly 
sustain operations like those in Afghanistan. According to a 
recent study by the Center for Strategic and International 
Studies, the Department of Defense spends, on average, nearly 
one-third of its entire budget contracting for services. And, 
while this committee and others in Congress have taken 
aggressive actions to reform the Government's acquisition 
processes, most of our time and effort has been focused on 
major defense acquisition programs such as the Joint Strike 
Fighter and the Littoral Combat Ship.
    Perhaps this is because they are tangible and there is more 
a formal process used to procure hardware. Regardless, we don't 
spend nearly as much time addressing issues regarding the way 
the DOD contracts for services such as engineering, 
maintenance, logistics, and base support.
    Contracting for services cannot be taken lightly. Here is a 
fact--one that I expect our witnesses will not challenge--the 
U.S. military cannot today fulfill its responsibilities to our 
national security without a significant contribution by many 
hardworking folks that are not in the direct employment of the 
U.S. Government. That fact extends to war zones too. Most of us 
are familiar with the term ``contingency contracting'' which 
has been used over the last several years to refer to contracts 
in Iraq and Afghanistan. The term likely conjures up memories 
of money wasted on $600 toilet seats, funding that fuels 
corruption, and the loss of hearts and minds anytime armed 
security guards kill or injure civilians. But the goal of 
today's hearing is not to re-examine these, or other, 
incidents. There has already been extensive work to document 
these deficiencies and to capture lessons learned. The goal is 
to learn from the past and charter a way forward, because I 
think we can all agree that we will continue to be reliant on 
contractors for future operations.
    As such, the topic before us today is complex, but it is 
also important. We learned a lot of hard lessons on this issue 
in Iraq and Afghanistan. We were ill-prepared for the level of 
contracting that was required to support these missions and, as 
a result, outcomes suffered. In some cases those consequences 
were grave and brave Americans lost their lives as a result.
    The question before us is how we can improve operational 
contract support outcomes--from savings lives, to reducing 
waste and graft, to delivering a unity of effort consistent 
with our military commander's intent. This will require 
leadership and an emphasis on the importance of operational 
contract support.
    Excellence must be demanded in each of the requirements 
generation, contract award, and contract management phases. A 
prerequisite for excellence is planning and training like we 
fight. There are many recommendations that have been advanced 
to meet these goals and I look forward to exploring those 
recommendations in greater detail today.
    I am certain that our witnesses' testimony will help us and 
the Department of Defense, as we continue the mission in 
Afghanistan and prepare for the challenges that may come, here 
at home or around the globe.

                      Statement of Hon. Adam Smith

           Ranking Member, House Committee on Armed Services

                               Hearing on

              Operational Contract Support: Learning from

                 the Past and Preparing for the Future

                           September 12, 2012

    Mr. Chairman, I share your remarks on the events in Libya 
and also in Egypt. Our thoughts and prayers certainly go out to 
the people who lost their lives and their families. It is a 
tragic incident and reminds us, again, of how unstable the 
world is and can be.
    I thank you for holding this hearing. As well, I thank our 
witnesses, and look forward to the testimony and the question-
and-answer period.
    Logistics and contracting out are critical, critical parts 
of our military and national security operation that don't 
typically get the attention that they obviously deserve. With 
all of the human resources and all of the material resources 
that we have, getting them all in the right place at the right 
time and making sure they are properly coordinated is an 
enormous and very important task and something that I believe 
our military does better than any military in the world.
    And part of the reason why we are as successful as we are, 
a piece of that, of course, is contracting out those services, 
figuring out what can be done in house and what needs to be 
contracted out--also not an easy process. And, of course, there 
are our legislative and parochial battles that get in the way 
of making it an easy process, as well.
    And so I think it is important that we examine that issue 
and try to figure out how to maximize our effectiveness at 
contracting out and pulling together those logistical 
challenges.
    I also believe that, given the wars in Iraq and 
Afghanistan, we have an excellent opportunity right now for a 
``lessons learned'' approach, go back and look and see what we 
did, what worked, what didn't work. A lot of it had to happen 
fairly quickly, so I certainly understand that decisions had to 
be made quickly. But now that we have had some time to think 
about it and look at it, I think this is a great opportunity to 
learn from that and make improvements where we can. 


[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]



=======================================================================


              WITNESS RESPONSES TO QUESTIONS ASKED DURING

                              THE HEARING

                           September 12, 2012

=======================================================================

      
              RESPONSE TO QUESTION SUBMITTED BY MR. PLATTS

    Secretary Estevez. The Department has made considerable progress in 
identifying vendors who are insurgents through Task Force 2010. Task 
Force 2010 was formed in July 2010 to provide a business intelligence 
capability by conducting assessments of contracts and vendors operating 
in Afghanistan; recommend risk mitigation strategies to commanders and 
contracting activities to prevent fraud and abuse; and propose actions 
to hold contractors accountable. Their desired end-state is to gain an 
understanding of the vendors the Department is doing business with; to 
prevent and protect U.S. money and property so it does not enrich 
insurgents, criminal networks, and power-brokers; and obtain 
accountability of the operational effects of contracting actions in 
support of International Security Assistance Force's counterinsurgency 
mission so as not to undermine the U.S. efforts in Afghanistan. 
Identification of the vendors is made available to the contracting 
activities. There is an ongoing collaboration and information sharing 
with other Federal agencies, e.g., United States Agency for 
International Development (USAID) and the United States Department of 
State (DOS).
    TF-2010, along with CENTCOM--Joint Theater Support Contracting 
Center (Forward) and ISAF Joint Command (IJC) hold a biweekly Vendor 
Vetting Advisory Panel and share the information on vendors with both 
DOD Contracting Agencies that do business in Afghanistan, U.S. Embassy 
and USAID. There is an open flow of information to ensure that everyone 
has the same understanding about the available information on vendors 
wanting to do business in Afghanistan. [See page 29.]
                                 ______
                                 
              RESPONSE TO QUESTION SUBMITTED BY MS. SPEIER
    Mr. Schwartz. There is no clear metric against which to measure 
cultural change. However, there are some guideposts that can help gauge 
the extent to which DOD changes the way it thinks about and values the 
role of contract support in military operations. Some of these 
guideposts include:

    1) The extent to which the role of contractors is incorporated into 
various DOD documents (such as the QDR, DOD Instructions or Memos, 
Field Manuals, etc.), and the extent to which the role of contractors 
is included in the discourse of senior leaders.
    2) The extent to which the role of contractors is incorporated into 
the military education system and the extent to which such courses are 
required or are actually taken by warfighters.
    3) The extent to which DOD includes contractor scenarios in field-
exercises.
    4) The extent to which resources are dedicated to account for 
contracting in planning for future operations (including dedicating 
resources for planners and completing Annex Ws).
    5) The extent to which working with and managing contractors is 
included in relevant performance evaluations and is considered by 
promotion boards.
    6) The extent to which acquisition workforce and contracting 
officer representative billets are filled.

    While none of these guideposts, in and of themselves, can be 
expected to accurately reflect DODs culture, taken as a whole these 
guideposts may provide evidence of the extent to which DOD is seeking 
to transform contracting into a core competence. [See page 25.]
?

      
=======================================================================


              QUESTIONS SUBMITTED BY MEMBERS POST HEARING

                           September 12, 2012

=======================================================================

      
                   QUESTIONS SUBMITTED BY MS. SPEIER

    Ms. Speier. How do we make operational contracting support part of 
the warfighter culture? What steps can Congress take to help the 
process?
    Secretary Estevez. The Department has taken several steps to 
integrate operational contracting support as part of the warfighter 
culture. DOD has incorporated operational contract support into policy 
and doctrine, and is continuing to institutionalize responsibilities 
and procedures (to include planning, training, education, 
accountability, and reporting) across the Department.
    Additionally we are instilling OCS in the warfighter culture 
through senior leader engagement (such as policy memorandums from both 
the Secretary of Defense and the Chairman of the Joint Chiefs of Staff 
focusing attention on contract support integration, planning and 
resourcing); expansion of doctrine in the area of OCS (incorporating 
best practices from lessons learned); and, the integration of OCS in 
training and joint exercises to validate the effectiveness of OCS 
plans.
    Furthermore, instruction on OCS, which just a few years ago was 
focused on acquisition specialists and selected senior leaders, is now 
being integrated as part of the core curriculum in military schools. 
For example, in mid-October, the Deputy Assistant Secretary of Defense 
for Program Support gave a presentation on OCS to the entire Command 
and General Staff College student body (1,200 officers) to talk about 
contractors as part of the total force, planning considerations, and 
their role in identifying requirements for, and integrating and 
managing contractor support to, military operations.
    We are grateful for Congress' continued interest and support in 
ensuring OCS remains a priority.

    Ms. Speier. How do we make operational contracting support part of 
the warfighter culture? What steps can Congress take to help the 
process?
    General Crenshaw. The primary means of instilling operational 
contract support into warfighter culture is to continue to 
institutionalize and integrate this powerful and complex capability 
across the full solution space of doctrine, organization, training, 
materiel, leadership and education, personnel, facilities and policy 
(DOTMLPF-P). For the past decade, the Department has steadily built OCS 
capability and capacity and put in place the rules, tools, and 
processes to better facilitate OCS planning and execution. With the 
support of Congress, the Department has incorporated OCS into DOD 
policy; joint doctrine; Secretary of Defense and Chairman of the Joint 
Chiefs of Staff strategic and operational planning guidance; detailed 
OCS planning requirements, templates, and procedures; joint training; 
and joint professional military education. Looking forward, training 
and education are viewed as the ascendant means of preparing leaders at 
all levels to understand the challenges and opportunities of employing 
this powerful but complex capability and instilling operational 
contract support into warfighter culture. Congress has been an 
excellent partner throughout the process for institutionalizing 
operational contract support and we look forward to your continued 
support.

    Ms. Speier. As you note in your testimony, the acquisition 
workforce was largely decimated in the Cold War drawdown. What measures 
should Congress consider to ensure that history does not repeat itself?
    Mr. Schwartz. Congress has played a critical role in determining 
the size of the acquisition workforce. For example, from FY1996-FY1999, 
Congress directed the Administration to reduce the size of the DOD 
acquisition workforce--defined as the employees who participate in the 
development and procurement of weapons, equipment, and provisions for 
the military services. Just as Congress in the past directed a decrease 
in the size of the acquisition workforce, Congress can take steps to 
maintain or increase the size of DOD's acquisition workforce. For 
example, in the National Defense Authorization Act for FY2008, Congress 
established the Defense Acquisition Workforce Development Fund to help 
rebuild the acquisition workforce. While the fund was used to hire more 
than 5,800 new acquisition staff through Fiscal Year 2011, a recent GAO 
report found that DOD does not have an overarching strategy aligning 
the fund with its acquisition workforce plan and that the fund had 
large unobligated balances that were not used. In addition to 
establishing and supporting programs such as the Defense Acquisition 
Workforce Development Fund, other options available to Congress may 
include the following:

        1.   ensuring that a sufficient budget is dedicated to funding 
        an appropriately sized acquisition workforce; and
        2.   conducting oversight to ensure that DOD consistently 
        develops comprehensive workforce planning analyses to determine 
        the needs and the appropriate size of the acquisition 
        workforce; develops and executes a workforce development 
        strategy based on the analyses; and uses existing funding and 
        authorities to support the acquisition workforce.
    Ms. Speier. If the Defense Department does not have the information 
it needs to make strategic decisions about its contractor and 
acquisition workforce, what steps should Congress take to give them the 
information and resources be more strategic managers of their 
operational contract support?
    Mr. Schwartz. Data reliability is a critical element in making 
informed policy decisions. If data is lacking or is unreliable, there 
may not be an appropriate basis for measuring or assessing the 
effectiveness of contracting, providing transparency into Government 
operations, or in making policy decisions. In some circumstances, a 
lack of reliable data could lead analysts and decisionmakers to draw 
incorrect or misleading conclusions. The result could be policies that 
squander resources, waste taxpayer dollars, and threaten the success of 
the mission. DOD and other agencies have faced challenges implementing 
systems that effectively track contractor and contracting data, as 
described here.

          In 2004, the U.S. Army Corps of Engineers and the 
        Project and Contracting Office developed the Iraq 
        Reconstruction Management System (IRMS), intended to serve as a 
        single database for tracking, coordinating, and managing all 
        U.S. Government agency projects receiving Iraq Relief and 
        Reconstruction Funds (IRRF). According to a report by the 
        Special Inspector General for Iraq Reconstruction, ``when IRMS 
        was initiated in 2004, it had a design life of five years 
        (completed in 2009). A life cycle maintenance program was not 
        implemented, and the system, then in its fourth year of 
        operation, was becoming operationally unreliable and 
        unstable.'' The report goes on to state that agencies used 
        other internal systems to track and manage their own projects.
          Section 861 of the FY2008 National Defense 
        Authorization Act required DOD, State, and USAID to identify 
        common databases that will serve as ``repositories of 
        information on contracts in Iraq or Afghanistan.'' Even though 
        the three agencies designated the Synchronized Predeployment 
        and Operational Tracker (SPOT) as their contract tracking 
        system in July 2008, DOD is still using a manual process--not 
        SPOT--to report the number of contractors in Iraq and 
        Afghanistan. According to a recent GAO report, SPOT still 
        cannot reliably track information on contracts, assistance 
        instruments, and associated personnel in Iraq or Afghanistan.
          Mr. Greg Gardner, then Deputy Chief Information 
        Officer (DCIO) for the Intelligence Community, stated that in 
        2009 the U.S. Government had 23 different network Information 
        Technology (IT) systems in Afghanistan, many of which were 
        duplicative and/or not interoperable. According to Mr. Gardner, 
        this multiplicity of IT systems results in wasteful spending 
        and poor data sharing between and within agencies. Data 
        reliability issues in Afghanistan persist; International 
        Security and Assistance Force (ISAF) and the U.S. Government 
        have not accurately or sufficiently tracked data upon which to 
        make strategic contracting decisions.
          The Federal Procurement Data System--Next Generation 
        (FPDS-NG) is a central database of U.S. Government-wide 
        procurement. The purpose of FPDS-NG is to provide data that can 
        be used as ``[A] basis for recurring and special reports to the 
        President, the Congress, the Government Accountability Office, 
        Federal executive agencies, and the general public.'' GAO, CBO, 
        and the Special Inspector General for Iraq Reconstruction have 
        all raised concerns over the accuracy and reliability of the 
        data contained in the FPDS-NG database. According to GAO, FPDS-
        NG often contains inaccurate data. Because of the concerns 
        raised over the reliability of data, many analysts rely on 
        FPDS-NG only to identify broad trends and make rough 
        estimations. DOD and other agency officials have acknowledged 
        gaps in data reliability and are making efforts to improve data 
        collection and reliability. However, this issue remains one 
        that many analysts believe is ripe for continued congressional 
        oversight.

    Ms. Speier. What steps should the Department of Defense and 
Congress take to be able to have a comprehensive, accurate inventory of 
our contractor forces?
    Mr. DiNapoli. Reliable, meaningful data related to contracts and 
contractor personnel are a starting point for informing agency 
decisions and ensuring proper management and oversight. In recent 
years, Congress has taken a series of actions to increase the oversight 
and availability of information related to certain Iraq and Afghanistan 
contracts and assistance instruments. Specifically, amendments from the 
Ike Skelton National Defense Authorization Act for Fiscal Year 2011 
require DOD, the Department of State, and the U.S. Agency for 
International Development to submit annual joint reports to 
congressional committees on certain contracts and assistance 
instruments with work performed in Iraq or Afghanistan. The reports are 
to address several matters, including the total number of contractor 
personnel and the total number of contractor personnel performing 
security functions. However, in our most recent review of this report, 
we found that DOD continues to face challenges in obtaining accurate 
and reliable data on contractor personnel, particularly on local 
national contractor personnel in Afghanistan. These challenges include 
fluctuating numbers of contractor personnel and work performed at 
remote locations, which make it difficult for DOD officials to validate 
the data. DOD officials informed us that since January 2010, they have 
been taking steps to regularly validate data regarding the number of 
contractor personnel in Iraq and Afghanistan and that they will 
continue to work to improve this data until they consider it to be 
sufficiently reliable. DOD has also experienced mixed success in 
developing an inventory of contracted services in accordance with 
section 2330a of title 10 of the U.S. Code, which requires DOD to 
annually compile and review an inventory of activities performed 
pursuant to contracts for services, including information on the number 
of contractor full-time equivalents providing services to the 
Department and the functions they are performing. In April 2012, we 
reported that DOD had made a number of changes to improve the utility 
of the fiscal year 2010 inventory, such as centrally preparing contract 
data to provide greater consistency among DOD components and increasing 
the level of detail on the services provided. With the exception of the 
Army and one other component, DOD components continued to rely on the 
Federal Procurement Data System-Next Generation as the primary source 
of their inventory data. As such, DOD acknowledged a number of factors 
that limited the utility, accuracy, and completeness of the inventory 
data. In November 2011, DOD submitted to Congress a plan to collect 
contractor manpower data. DOD officials noted that developing a common 
data system to collect and house these data would be challenging given 
the different requirements from the military departments and 
components. Consequently, DOD does not expect to fully collect 
contractor manpower data until fiscal year 2016. DOD's plan, however, 
does not establish milestones or specify how it will meet the 
legislative requirement to identify the requiring activity and the 
function and missions performed by the contractor. In April 2012, we 
reported that the military departments' required reviews of their 
fiscal year 2009 inventories were incomplete. In our review, we found 
that Navy headquarters officials had no assurance that their commands 
had conducted the required reviews. Further, we found that the Army and 
Air Force inventory reviews had identified 1,935 and 91 instances, 
respectively, in which contractors were performing inherently 
governmental functions, though this variation may reflect differences 
in the departments' approaches to conducting the reviews. In 8 of 12 of 
the Army and Air Force cases GAO reviewed, contractors continued to 
perform functions that the military departments had identified as 
inherently governmental. The absence of guidance that provided for 
clear lines of responsibility for conducting, documenting, and 
addressing the results of the reviews contributed to these outcomes. To 
improve the inventory, we recommended that the military departments and 
components develop guidance that provides for clear lines of authority, 
responsibility, and accountability for conducting an inventory review. 
DOD partially agreed with our recommendation, noting that as defense 
components vary in size and mission, the need for individual components 
to have organization-specific guidance should not be mandated but 
rather determined by each component head. Our work found, however, that 
the absence of guidance at the military department-level that provides 
for clear lines of authority, responsibility and accountability 
contributed to the shortcomings and challenges encountered during the 
military departments' review of their fiscal year 2009 inventories. As 
such, we continue to believe that it would be prudent for DOD to obtain 
sufficient assurance that the military departments' and components' 
guidance provide the foundation for conducting a meaningful review.
                                 ______
                                 
                  QUESTIONS SUBMITTED BY MR. SCHILLING
    Mr. Schilling. How does DOD plan to overcome delays in budgeting 
and distributing funds in the Defense Acquisition Workforce Development 
fund? Does DOD plan to clarify its guidance on the availability and use 
of related funds?
    Secretary Estevez. DOD has collected and distributed funds to 
components to cover 100 percent of the Fiscal Year 2013 first quarter 
execution requirements using DAWDF funds collected in FY 2012. 
Additional funds to support component execution requirements for the 
second quarter of FY 2013 will soon be distributed using funds 
collected in FY 2012. A portion of the FY 2013 DAWDF appropriated funds 
will also be available under the Continuing Resolution. DOD has 
provided guidance on availability and use of the funds. In addition, 
DOD holds biweekly update meetings with components to provide status on 
availability and answer questions on use of the DAWDF funding.
    Mr. Schilling. What do you think of suggestions that those folks 
going into the acquisition workforce be required to not only go through 
specific training courses, but to also spend a year in industry to 
understand how business works?
    Secretary Estevez. While DOD provides opportunities for the 
acquisition workforce to obtain experience with industry, it would not 
be appropriate to make it a requirement for the 150,000 person 
workforce. Opportunities are available through the Secretary of Defense 
Corporate Fellows, the Army Training With Industry (TWI), and Air Force 
Education with Industry (EWI) programs. Today, the Army, Navy and Air 
Force have 37 participants in these industry experience programs and 
each year the Air Force selects three participants for a Fortune 500 
fellowship. Additionally, Defense Acquisition University has led 
establishment of industry knowledge and acumen competencies. Last year 
580 industry members participated in training classes at DAU along with 
defense acquisition workforce members.
    Mr. Schilling. How can DOD improve its responsibility for making 
sure acquisition officers get the training they need? Who is 
responsible for doing that?
    Secretary Estevez. DOD continues to increase training capacity and 
resources for the acquisition professionals using the Defense 
Acquisition Workforce Development Fund (DAWDF). The Defense Acquisition 
University (DAU) has increased training for the workforce by 58 percent 
since 2008; increasing seats from 36,000 in 2008 to 57,000 in 2012, and 
provided additional targeted training to DOD components. DOD has also 
enhanced its curriculum to address departmental and environmental 
changes by adding training on Better Buying Power/efficiency 
initiatives, Operational Contract Support, and other critical areas. 
DOD component acquisition executives and their acquisition career 
managers, DOD Functional Leaders, and the Defense Acquisition 
University work closely together to ensure the workforce gets the 
training they need.
    Mr. Schilling. How do you ensure that DOD Senior Leadership puts 
the emphasis needed on acquisitions that it should? How can you start 
that cultural change?
    Secretary Estevez. The change in culture with respect to 
operational contract support has already begun. The Department has 
taken several steps to integrate operational contract support (OCS) as 
part of the warfighter culture at the strategic, operational and 
tactical levels. Both the Secretary of Defense and the Chairman of the 
Joint Chiefs of Staff as well as senior commanders in the field have 
signed policy memorandums focusing attention on contract support 
integration, planning and resourcing. DOD has also included an expanded 
concept of operational contract support into policy and doctrine, 
incorporating best practices from lessons learned. Further, we are 
continuing to institutionalize responsibilities and procedures--to 
include planning, training, education, accountability, and reporting--
across the Department. Finally, OCS is being integrated into training 
and joint exercises to validate the effectiveness of OCS plans.

    Mr. Schilling. What do you think of suggestions that those folks 
going into the acquisition workforce be required to not only go through 
specific training courses, but to also spend a year in industry to 
understand how business works?
    General Crenshaw. There are a number of existing requirements and 
opportunities to help the acquisition workforce understand industry and 
how business works. The Defense Acquisition Workforce Improvement Act 
(DAWIA) was signed into law in November 1990 and modified several times 
in subsequent legislation. It establishes detailed education and 
training standards, requirements, and courses for the Department of 
Defense civilian and military acquisition workforce across multiple 
career fields with certification at three different levels. DAWIA 
certification requires a significant amount of prerequisite college-
level business courses in many of these career fields and includes 
continuing education requirements. To stay current with industry 
practices, many acquisition workforce members also pursue other 
professional certification (e.g., Certified Professional Contracts 
Manager (CPCM)) to enhance their DAWIA training and education. The 
Department also offers various ``training with industry'' programs and 
the acquisition workforce includes professionals who have spent time in 
industry to broaden their skills. Further, economic cycles have 
provided incentives for both Government and industry acquisition 
professionals to spend time on each side of the acquisition equation 
which enhances career development and appreciation of roles. The 
current broad mosaic of acquisition workforce professionals and array 
of opportunities to understand industry and business appears to be 
healthy and sustainable. More specific questions concerning the 
acquisition workforce could best be addressed by the Under Secretary of 
Defense for Acquisition, Technology, and Logistics.
    Mr. Schilling. How can DOD improve its responsibility for making 
sure acquisition officers get the training they need? Who is 
responsible for doing that?
    General Crenshaw. Training and education requirements for the 
acquisition workforce are well documented in the Defense Acquisition 
Workforce Improvement Act (DAWIA) and various Department policy and 
regulations. It is a shared responsibility between individuals and 
supervisors for fulfilling these requirements. Acquisition workforce 
members and their supervisors are well aware of the requirements and 
means for fulfilling them, primarily through the Defense Acquisition 
University. Various tools are used to inform individuals and their 
supervisors of their DAWIA training and certification status. 
Acquisition workforce professionals take their certification status 
seriously to stay current which in turn keeps them competitive for 
acquisition positions of greater responsibility. More specific 
questions concerning the acquisition workforce could best be addressed 
by the Under Secretary of Defense for Acquisition, Technology, and 
Logistics.
    Mr. Schilling. How do you ensure that DOD Senior Leadership puts 
the emphasis needed on acquisitions that it should? How can you start 
that cultural change?
    General Crenshaw. Education and oversight are two means DOD uses to 
ensure Senior Leadership puts emphasis on acquisition. Education 
prepares leaders at all levels to better understand acquisition 
challenges and opportunities and helps instill critical thought in 
addressing complex issues across the solution space of doctrine, 
organization, training, materiel, leadership and education, personnel, 
facilities, and policy (DOTMLPF-P), regulations, and law. Fortunately, 
a large amount of this education and training is addressed under the 
Defense Acquisition Workforce Improvement Act and provided by the 
Defense Acquisition University. The various oversight mechanisms (e.g., 
Congress, Government Accountability Office, Commissions) also provide 
an invaluable feedback mechanism to assess the Department's ability to 
manage acquisition and in turn update acquisition regulations, policy, 
processes, and education. While the Department already places a great 
deal of emphasis on acquisition, further cultural change will be 
enhanced by continuing to encourage acquisition education and by 
critically reviewing and analyzing oversight findings to determine if 
changes to DOTMLPF-P, regulations, or law could enhance outcomes. More 
specific questions concerning acquisition could best be addressed by 
the Under Secretary of Defense for Acquisition, Technology, and 
Logistics.

    Mr. Schilling. What do you think of suggestions that those folks 
going into the acquisition workforce be required to not only go through 
specific training courses, but to also spend a year in industry to 
understand how business works?
    Mr. Schwartz. For decades, numerous analysts have argued that the 
ability of the Department of Defense (DOD) to effectively and 
efficiently acquire goods and services depends substantially on the 
competence and experience of the acquisition personnel. Yet, compared 
to industry, the defense acquisition workforce has often been 
considered ``undertrained, underpaid, and inexperienced.'' A number of 
analysts have argued that the DOD acquisition workforce does not know 
enough about industry, the financial incentives that drive corporate 
decisions, or the costs, schedules, and technical performance in large 
industrial firms. A lack of insight into the private sector can result 
in Government managers not making what may be viewed by some as 
difficult decisions required to create and reward lean industrial 
organizations. Having an appropriate number of DOD acquisition 
personnel spend time in industry could have a positive effect on the 
ability, experience, and insight of the acquisition workforce, and a 
number of analysts have argued for such an expanded program. The extent 
to which time in industry should be a requirement for all (or part) of 
the acquisition workforce, required for promotion, advancement and 
growth opportunities, or just one option available as part of a 
comprehensive training and education program may depend on a number of 
factors, including:

        1.   overall cost to the Government for maintaining such a 
        program;
        2.   concerns over conflict of interest rules;
        3.   any ``Full-Time Equivalents'' (FTE) caps placed on the 
        acquisition workforce; and
        4.   opportunity costs for other training options.

    In addition to time spent working in industry, some analysts have 
suggested that future program managers or other appropriate acquisition 
personnel should be required to complete 6 months or more of formal, 
advanced training where they can study and learn appropriate management 
techniques and acquisition skills. Some analysts have suggested that 
DOD make a concerted effort to recruit capable and experienced 
acquisition personnel from industry. Others have suggested that 
Government may not offer competitive salaries or career advancement 
opportunities to interest professionals from the private sector.
    Mr. Schilling. Do you believe a stronger focus on STEM (Science, 
Technology, Engineering, and Mathematics) education would help address 
the future needs for acquisition officers?
    Mr. Schwartz. Within the context of the discussion above, a 
stronger focus on STEM could be beneficial for those members of the 
acquisition workforce who are involved in acquisitions that possess 
substantial STEM elements, such as some major defense acquisition 
programs.
    Mr. Schilling. What is the best way to enforce proper oversight 
within DOD's contracting operations?
    Mr. Schwartz. For more than 200 years, Congress and the executive 
branch have expressed frustration with the level of mismanagement and 
corruption in defense acquisitions, having spent significant resources 
seeking to reform and improve the process. For example, concerns over 
the Continental Army's reliance on contractors during the Revolutionary 
War prompted the Continental Congress, in 1775, to establish a 
procurement system and appoint both a commissary general and a 
quartermaster general to buy goods and services for the Continental 
Army. In 1862, during the Civil War, President Abraham Lincoln 
requested the resignation of Secretary of War Simon Cameron, in large 
part because of contracting, corruption, and mismanagement issues 
within the War Department. That same year, the House Committee on 
Contracts issued a 1,100 page report that documented corruption and 
mismanagement in defense acquisitions that resulted in the Government 
buying weapons that did not work, horses that were diseased, and food 
that was rotten. More recently, concerns over defense acquisitions have 
often centered around significant cost overruns, schedule delays, and 
an inability to get troops the equipment they needed when they needed 
it. Many analysts believe that cost overruns and schedule delays have a 
debilitating effect on the U.S. military and threaten America's 
technological advantage and military capabilities. Both Congress and 
DOD have been active in trying to improve defense acquisitions. Since 
the end of World War II, there have been more than nearly 130 studies 
on acquisition reform. Despite the numerous studies, congressional 
hearings, and DOD reports that have often echoed the same themes and 
highlighted the same weaknesses in the acquisition process, acquisition 
reform efforts pursued over the last 30 years have been unable to rein 
in cost and schedule growth. In addition to the concerns expressed 
regarding the acquisition workforce (see the question on page 105), 
many analysts have suggested that changing the culture of the military 
is a prerequisite for creating lasting systemic change and improving 
operational contract support. Analysts have proposed a number of 
legislative options aimed at changing the culture of the military. Some 
of these options include the following:

    Requiring that Contractors Be Included in Command Post and Field 
Exercises.

          One of the mantras of the military is ``to train as you fight 
        and fight as you train.'' Given the extent to which contractors 
        may be relied upon in future combat operations, conducting 
        exercises without contractors could be akin to training without 
        half of the force present. A number of analysts have called for 
        incorporating contractors and contractor scenarios into 
        appropriate military exercises to better prepare military 
        planners and operational commanders for handling future 
        operations. P.L. 110-181, the National Defense Authorization 
        Act for FY2008, mandated the incorporation of contractors in 
        mission-readiness exercises with uniformed personnel. Over the 
        last few years, DOD has included contractor scenarios into a 
        number of command and mission-readiness exercises. Despite 
        increased inclusion of contractors in some exercises, over the 
        last two years a number of reports have suggested that DOD has 
        not sufficiently included contractor roles in battlefield 
        exercises. Including contractors in live-fire exercises for 
        example, could increase warfighter awareness of the presence of 
        contractors on the battlefield and improve military-contractor 
        coordination in actual operations.

    Requiring Performance Evaluations To Include Contractor Management

          Congress may wish to consider requiring officer and/or 
        enlisted performance evaluations to include commentary and/or 
        grade evaluation of contractor management. Including a 
        contractor management narrative as part of a performance 
        evaluation could help ensure that attention is given to this 
        issue. However, contract support is not relevant for all 
        military personnel, and elements of contract support could also 
        fall under other evaluation factors, such as personnel 
        management. Alternatively, Congress could consider requiring 
        performance evaluations for any military personnel whose 
        mission involves or substantially relies on contractor support. 
        Another possible option might be to amend the performance 
        evaluation guidelines to stipulate that contractor management 
        be part of the discussion of personnel management or other 
        related factors.

    Requiring Military Departments To Report on Acquisition Education 
Courses Available for Operational Personnel

          Such a requirement would be similar to Section 527 of the 
        FY2009 Duncan Hunter National Defense Authorization Act (P.L. 
        110-417) which requires the Chairman of the Joint Chiefs of 
        Staff to submit to Congress a report outlining the joint 
        education courses available throughout DOD. Such a report might 
        help Congress execute its oversight function.

    Requiring Military Departments To Report on Non-Acquisition 
Workforce Contracting Education and Training Goals, and Progress in 
Meeting Those Goals

          Such a report might help accomplish two goals: (1) help 
        Congress chart the military's progress in preparing the 
        operational force to work with contractors during expeditionary 
        operations, and (2) help DOD maintain focus on this issue. DOD 
        has stated as far back as 2004 that it would explore creating 
        training courses on contracting for mid- and senior-level 
        service schools. On the one hand, some analysts have argued 
        that DOD failed to follow through adequately on creating 
        additional training on contract support until Congress mandated 
        training for appropriate non-acquisition military personnel. 
        DOD has undertaken concrete steps to improve how the 
        operational force works with contractors and has incorporated 
        contractors and operations into mission-readiness and other 
        exercises. Some analysts have argued that only sustained 
        congressional attention can help ensure that the desired 
        results will be achieved. On the other hand, some other 
        analysts have argued that ensuring proper oversight requires 
        that sufficient personnel and resources are dedicated to 
        contract management and oversight. Insufficient resources or 
        shortages in the numbers of oversight personnel increase the 
        risk of poor contract performance, which in turn can lead to 
        waste, fraud, abuse, and mismanagement. DOD has documented how 
        a lack of oversight has resulted in contracts not being 
        performed to required specifications and to the theft of tens 
        of millions of dollars' worth of equipment, repair parts, and 
        supplies. Still, some analysts have argued that one way to 
        ensure sufficient resources dedicated to contract oversight is 
        to require that a fee be added to all contracts over a certain 
        dollar threshold, and that the proceeds of that fee be 
        dedicated to funding contract oversight and management.

    Mr. Schilling. What do you think of suggestions that those folks 
going into the acquisition workforce be required to not only go through 
specific training courses, but to also spend a year in industry to 
understand how business works?
    Mr. DiNapoli. We have previously voiced support for establishing an 
acquisition professional exchange program. For example, in 2003 we 
testified that establishing an exchange program could enhance the 
ability of Federal workers and enable them to gain from the knowledge 
and expertise of private-sector professionals and entities. However, as 
with any training or development program, it would be important for the 
Department of Defense (DOD) to first plan for and analyze the design of 
an exchange program before implementing it. Front-end planning and 
analysis could help to ensure that DOD:

        (a)   linked such a program to departmental goals and to the 
        organizational, occupational, and individual skills and 
        competencies needed for the Department to perform effectively; 
        and
        (b)   implemented the program with the Department's 
        organizational culture firmly in mind.

    In our recent review of DOD's fellowship and training-with-industry 
programs at think tanks, private corporations, and Federal agencies we 
note the importance of overseeing these programs once they are 
implemented. Specifically, we reported that DOD had limited insight 
into the programs and that military departments had difficulties in 
determining whether these programs were achieving their intended 
benefits and were cost-effective.
    Mr. Schilling. Do you believe a stronger focus on STEM (Science, 
Technology, Engineering, and Mathematics) education would help address 
the future needs for acquisition officers?
    Mr. DiNapoli. Our past work has shown that Federal agencies need to 
determine the skills and competencies critical to achieving their 
missions and goals, and to identify any gaps between the current 
workforce and the workforce needed in the future. By taking these 
steps, agencies would be in a better position to adjust to changes in 
technology, budget constraints, and other factors that alter the 
environment in which they operate. The DOD acquisition workforce is no 
exception. The Defense Acquisition Workforce Improvement Strategy 
outlines a competency assessment strategy for the acquisition workforce 
as a way to assess workforce capability using updated and validated 
enterprise-wide models, data, and information. In November 2011, we 
reported that, according to DOD, of 13 total planned competency 
assessments, the Department had completed 3 assessments (for 
contracting, life-cycle logistics, and program management) and was 
drafting the final report for another 6 assessments. In turn, such 
assessments could identify where DOD needs to improve the acquisition 
workforce's professional education in such fields as science, 
technology, engineering, and mathematics.
    Mr. Schilling. What is the best way to enforce proper oversight 
within DOD's contracting operations?
    Mr. DiNapoli. Effective contract management and oversight is 
essential for ensuring that U.S. military personnel receive the support 
they need and that controls are in place to prevent fraud, waste, and 
abuse. Ultimately, failure to manage and oversee contracts effectively 
could undermine U.S. policy objectives and threaten the safety of U.S. 
forces. Our prior work has shown the importance of having an adequate 
number of trained oversight personnel in order for DOD to help ensure 
that contractors can meet contract requirements efficiently and 
effectively. However, as recently as March 2012, we reported that DOD's 
contracting officer's representatives--personnel who help to manage and 
oversee contracts by acting as liaisons between the contractor, 
contracting officer, and the unit receiving support--in Afghanistan did 
not always have the proper training and subject matter expertise to 
monitor their assigned contracts and that there was a shortage of these 
personnel. We recommended that DOD enhance the current strategy for 
managing and overseeing contracts in contingency areas such as 
Afghanistan by developing training standards for providing operational 
contract support, fully institutionalizing operational contract support 
in professional military education, and developing standards regarding 
the number of contracts that contracting officer's representatives can 
oversee based on the technical nature and complexity of the contract. 
DOD concurred with all of these recommendations and identified steps it 
plans to take to implement them.

                                  
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