1994 Defense Budget: Potential Reductions, Rescissions, and Restrictions
to RDT&E Programs (Briefing Report, 09/30/93, GAO/NSIAD-93-293BR).

This report reviews the Defense Department's (DOD) budget request for
fiscal year 1994 and prior years' appropriations for research,
development, test, and evaluation (RDT&E) programs.  Schedule delays,
changes in program requirements, and uncertainties have affected RDT&E
funding requirements for fiscal year 1994 as well as prior years'
appropriations.  GAO identified potential budget cuts of about $473
million and rescissions from prior years' appropriations of nearly $43
million.  GAO also identified about $958 million in requested funding
that Congress can restrict.

--------------------------- Indexing Terms -----------------------------

 REPORTNUM:  NSIAD-93-293BR
     TITLE:  1994 Defense Budget: Potential Reductions, Rescissions, and 
             Restrictions to RDT&E Programs
      DATE:  09/30/93
   SUBJECT:  Advanced weapons systems
             Military cost control
             Budget cuts
             Military appropriations
             Defense budgets
             Budget authority rescission
             Research and development
             Research programs
             Total obligational authority
             Weapons research

             
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Cover
================================================================ COVER


Briefing Report to Congressional Committees

September 1993

1994 DEFENSE BUDGET - POTENTIAL
REDUCTIONS, RESCISSIONS, AND
RESTRICTIONS TO RDT&E PROGRAMS

GAO/NSIAD-93-293BR

1994 Defense Budget

(395216)


Abbreviations
=============================================================== ABBREV

  BMDO - Ballistic Missile Defense Organization
  DOD - Department of Defense
  NASA - National Aeronautics and Space Administration
  PAC-3 - Patriot Advanced Capability-Three
  RDT&E - research, development, test, and evaluation

Letter
=============================================================== LETTER


B-254792

September 30, 1993

Congressional Committees

We examined the Department of Defense's (DOD) fiscal year 1994 budget
request and prior years' appropriations for selected research,
development, test, and evaluation (RDT&E) programs.  Our objectives
were to identify potential reductions to the fiscal year 1994 budget
request and potential rescissions to prior year appropriations.  We
also identified potential restrictions the Congress can place on the
obligational authority for certain RDT&E programs.  This report
summarizes information and briefings provided to your staffs from May
to September 1993.  This is one of a series of reports that examines
defense budget issues. 

Our review showed that schedule delays, program requirements changes,
and uncertainties have affected RDT&E funding requirements for fiscal
year 1994 as well as prior years' appropriations.  As shown in table
1, we identified potential budget reductions of about $472.6 million
and rescissions from prior years' appropriations of about $42.7
million.  We also identified approximately $958.3 million in
requested funding that the Congress can restrict. 



                                Table 1
                
                 Potential Reductions, Rescissions, and
                     Restrictions to RDT&E Programs

                         (Dollars in millions)

                                 Potential
                               fiscal year     Potential
                                      1994    prior year     Potential
Agency                          reductions   rescissions  restrictions
--------------------------  --------------  ------------  ------------
Army (app. I)                        $14.1         $16.8         $21.9
Navy (app. II)                         8.4          18.5             -
Air Force (app. III)                 415.3           7.4         142.4
Multiservice (app. IV)                34.8             -          27.2
Defensewide (app.V)                      -             -         766.8
======================================================================
Total                               $472.6         $42.7        $958.3
----------------------------------------------------------------------
We focused on program cost, schedule, and performance issues and
examined expenditure documents to determine whether requests were
adequately justified and whether unobligated funds from prior
appropriations should be retained.  We also evaluated budgetary
implications of program changes resulting from threat changes DOD
identified.  Appendix VI provides information regarding our scope and
methodology. 

We did not obtain written agency comments on a draft of this report. 
However, we did discuss the details in this report with Office of the
Secretary of Defense and program officials and incorporated their
comments where appropriate. 

We are sending copies of this report to the Secretaries of Defense,
the Army, the Navy, and the Air Force; and the Director, Office of
Management and Budget.  We will also make copies available to others
upon request. 

This report was prepared under the direction of Louis J.  Rodrigues,
Director, Systems Development and Production Issues, who may be
reached on (202) 512-4841 if you or your staffs have any questions. 
Other major contributors are listed in appendix VII. 

Frank C.  Conahan
Assistant Comptroller General


List of Congressional Committees

The Honorable Sam Nunn
Chairman
The Honorable Strom Thurmond
Ranking Minority Member
Committee on Armed Services
United States Senate

The Honorable Daniel K.  Inouye
Chairman
The Honorable Ted Stevens
Ranking Minority Member
Subcommittee on Defense
Committee on Appropriations
United States Senate

The Honorable Ronald V.  Dellums
Chairman
The Honorable Floyd D.  Spence
Ranking Minority Member
Committee on Armed Services
House of Representatives

The Honorable John P.  Murtha
Chairman
The Honorable Joseph M.  McDade
Ranking Minority Member
Subcommittee on Defense
Committee on Appropriations
House of Representatives


POTENTIAL REDUCTIONS, RESCISSIONS,
AND RESTRICTIONS TO ARMY RESEARCH,
DEVELOPMENT, TEST, AND EVALUATION
PROGRAMS
=========================================================== Appendix I

We identified about $14.1 million in potential reductions in the
Army's fiscal year 1994 research, development, test, and evaluation
(RDT&E) request, $16.8 million in potential rescissions in the Army's
fiscal years 1992 and 1993 funding, and $21.9 million in potential
restrictions to the Army's obligational authority for fiscal year
1994 requests.  The following section provides a brief description of
our analysis and proposed actions by program.  The proposed actions
are summarized in table I.1. 



                                    Table I.1
                     
                         Summary of Potential Reductions,
                      Rescissions, and Restrictions to Army
                                     Programs

                              (Dollars in millions)

                      Potential fiscal       Potential
                             year 1994      prior year       Potential
Program                     reductions     rescissions    restrictions  See page
--------------------  ----------------  --------------  --------------  --------
Environmental                        -         $10.400               -         8
 Quality Technology
Line-of-Sight,                       -           4.000               -         9
 Antitank
Tri-Service Standoff            $4.933               -               -        10
 Attack Missile
Javelin                          2.200               -               -        11
Brilliant Antiarmor              7.000               -          $5.000        12
 Submunition
Aviation-Advanced                    -           2.400               -        14
 Development
Other Missile                        -               -          16.900        14
 Product Improvement
 Programs
================================================================================
Total                          $14.133         $16.800         $21.900
--------------------------------------------------------------------------------

   ENVIRONMENTAL QUALITY
   TECHNOLOGY
--------------------------------------------------------- Appendix I:1

For fiscal year 1993, the Congress provided about $62.9 million to
the Army for the Environmental Quality Technology program.  Included
in the amount was $14.6 million for Biodegradable Packaging
Technology.  This program is a joint Department of Defense (DOD),
Department of Agriculture, and industry effort to commercialize
biodegradable packaging. 


      RESULTS OF ANALYSIS
------------------------------------------------------- Appendix I:1.1

The Congress can rescind $10.4 million of the Army's fiscal year 1993
unobligated funds for the Environmental Quality Technology program
because the Army has not released these funds to the responsible
program office and has not established a requirement for the funds. 
An Army official said that these funds are being held for other
future requirements. 



                               Table I.2
                
                    Environmental Quality Technology
                Funding/Request and Potential Rescission

                         (Dollars in millions)


Budget line                               1992        1993        1994
----------------------------------  ----------  ----------  ----------
23                                     $29.487     $62.875     $21.229
Potential rescission                         -      10.400           -
----------------------------------------------------------------------

   LINE-OF-SIGHT, ANTITANK
--------------------------------------------------------- Appendix I:2

The Line-of-Sight, Antitank weapon system is a kinetic-energy,
direct-fire missile that is mounted on a Bradley Fighting Vehicle
chassis.  The missile uses high speed and a heavy metal rod, rather
than an explosive warhead, to destroy tanks.  The missile is intended
to replace the Improved Tube-Launched, Optically Tracked, Wire-Guided
missile, which is mounted on a M113 vehicle chassis. 


      RESULTS OF ANALYSIS
------------------------------------------------------- Appendix I:2.1

The Army did not request funds for the weapon system in fiscal year
1994.  However, $4 million can be rescinded from the fiscal year 1993
unobligated funding because the Office of the Secretary of Defense
does not plan to permit the $4 million to be expended for the weapon
system. 

The Army had planned to begin Line-of-Sight, Antitank engineering and
manufacturing development in fiscal year 1993.  However, the Office
of the Secretary of Defense required the weapon system to continue in
advanced technology development and withheld $47 million of the
fiscal year 1993 appropriation--$43 million to fund the program in
fiscal year 1994 and $4 million to be reprogrammed to other uses. 

The deputy program manager stated he expects the $43 million to be
released in fiscal year 1994, and he acknowledged that the $4 million
was withdrawn and would not be released.  Therefore, the $4 million
is excess to the program's needs and is available for rescission. 



                               Table I.3
                
                  Line-of-Sight, Antitank Funding and
                          Potential Rescission

                         (Dollars in millions)


Budget line                               1992        1993        1994
----------------------------------  ----------  ----------  ----------
56                                     $27.900    $113.150           -
Potential rescission                         -       4.000           -
----------------------------------------------------------------------

   TRI-SERVICE STANDOFF ATTACK
   MISSILE
--------------------------------------------------------- Appendix I:3

The Tri-Service Standoff Attack Missile is a joint Army, Air Force,
and Navy program (led by the Air Force) to develop a stealthy
conventional cruise missile.  This Army missile variant is expected
to carry 22 Brilliant Antiarmor Submunitions and be launched from the
Multiple Launch Rocket System launcher. 


      RESULTS OF ANALYSIS
------------------------------------------------------- Appendix I:3.1

The Army's fiscal year 1994 budget request of approximately $89.7
million for the Tri-Service Standoff Attack Missile can be reduced by
about $4.9 million because the request exceeds requirements.  The
obligation plans for fiscal year 1994 show a planned expenditure of
$84.8 million, or $4.9 million less than the request. 

According to program management officials, the Army included $4.9
million in the overall request in anticipation of congressional
reductions and withholding of funding at higher command levels.  The
anticipated withholding included a general reduction by the program
executive office and funds for small business innovative research and
settling closed accounts. 

Program management officials told us that the $4.9 million was not
excess to their needs because unforecasted expenses arise.  They
said, for example, that the Army is renegotiating the contract that
provides Brilliant Antiarmor Submunitions for the Tri-Service
Standoff Attack Missile's operational tests and that the Tri-Service
Standoff Attack Missile program has to pay for these test articles. 
They also said that the $1.3 million for small business innovative
research would not be released to the project office. 

However, in the example of the contract renegotiation, we found that
the Army has not determined the amount of the increase nor the fiscal
year that the adjustments will occur.  Furthermore, cost estimates
used for preparing budget submissions already include amounts for
risk, and other administrative remedies are available for meeting
unexpected funding needs. 

We agree that the project office does not receive the amounts that
are withheld for small business innovative research.  However, the
authorizing legislation tasked the Army, not the project office, to
provide funding for small business innovative research. 



                               Table I.4
                
                  Tri-Service Standoff Attack Missile
                    Request and Potential Reduction

                         (Dollars in millions)


Budget line                               1992        1993        1994
----------------------------------  ----------  ----------  ----------
103                                        \a           -     $89.682
Potential reduction                          -           -       4.933
----------------------------------------------------------------------
\a Amounts appropriated for the Tri-Service Standoff Attack Missile
for fiscal years 1992 and 1993 are classified. 


   JAVELIN
--------------------------------------------------------- Appendix I:4

The Javelin is designed to be a medium-range, portable antiarmor
system for use in rapid deployment operations, rough terrain, and air
assault operations.  It is intended to defeat tanks and other targets
expected on the battlefield and to replace the Dragon weapon system
in the Army and Marine Corps inventories.  The system will consist of
a missile; an expendable container and launch tube, which will house
the missile; and a reusable command and launch unit for target
acquisition and surveillance. 


      RESULTS OF ANALYSIS
------------------------------------------------------- Appendix I:4.1

The Army's fiscal year 1994 request of about $44.9 million for the
Javelin can be reduced by $2.2 million because the request exceeds
requirements by $2.2 million. 

The Javelin project manager agreed; however, he said that 5 percent
was added in anticipation of congressional reductions and
appropriation adjustments by the Army and the program executive
office.  He said the general congressional reductions and Army
adjustments in fiscal year 1993 amounted to 5.4 percent for such
items as small business innovative research and closed accounts.  The
project manager said, although not a requirement, the $2.2 million
will be needed if similar reductions occur in fiscal year 1994.  The
project manager also stated that the amount that is withheld for
small business innovative research is not released to the project
office. 

The request can be reduced by $2.2 million because (1) the amount is
not planned to meet program requirements; (2) general reductions do
not occur every year; (3) amounts withheld for closed accounts are
contingency funds rather than actual needs; and (4) the Army, not the
individual projects, is tasked for small business innovative
research. 



                               Table I.5
                
                 Javelin Funding/Request and Potential
                               Reduction

                         (Dollars in millions)


Budget line                               1992        1993        1994
----------------------------------  ----------  ----------  ----------
109                                   $118.297     $95.929     $44.937
Potential reduction                          -           -       2.200
----------------------------------------------------------------------

   BRILLIANT ANTIARMOR SUBMUNITION
--------------------------------------------------------- Appendix I:5

The Brilliant Antiarmor Submunition is designed to be an antiarmor,
top attack submunition that will use an acoustic sensor to initially
locate targets and an infrared seeker to guide the submunition to its
target.  The submunition's primary carrier will be the Army variant
of the Tri-Service Standoff Attack Missile that will be launched from
the Multiple Launch Rocket System launcher.  The carrier will deliver
the submunition behind enemy lines to attack tanks and other targets
before they can reinforce front line troops. 

The Army was planning to begin a product improvement program for the
submunition in fiscal year 1993.  The goal of the product improvement
program is to increase submunition lethality and allow attack of new
targets, including cold, stationary tanks and mobile missile
launchers.  The carrier for the improved version will be a longer
range version of the Army Tactical Missile System. 


      RESULTS OF ANALYSIS
------------------------------------------------------- Appendix I:5.1

The Army's fiscal year 1994 request of about $117 million for the
submunition can be reduced by $7 million because the request exceeds
requirements.  The Congress can restrict obligational authority for
another $5 million until the Secretary of Defense determines that the
planned product improvement program is the most effective alternative
for accomplishing the mission. 


         REQUEST EXCEEDS
         REQUIREMENTS
----------------------------------------------------- Appendix I:5.1.1

The Brilliant Antiarmor Submunition project office included about $7
million in the request in anticipation of congressional and higher
command reductions to the appropriation before release to the project
office.  Submunitions program management officials stated that fiscal
year 1993 reductions included a 3-percent general reduction, 1.5
percent designated for small business innovative research, and
amounts withheld for closed accounts.  However, the request can be
reduced by $7 million because (1) the funding was not planned to meet
program requirements; (2) general reductions do not occur every year;
(3) the Army, not the individual projects, is tasked to provide
funding for small business research; and (4) amounts withheld for
closed accounts are contingency funds, rather than actual needs. 

The project manager stated that all funds requested were required for
the program.  He stated that the total requirement for contractor
funding for fiscal year 1994 was uncertain because the contract was
being renegotiated.  The deputy project manager reiterated that the
project office does not control the funds that are used for small
business innovative research ($1.8 million for the Brilliant
Antiarmor Submunition) because the Army removes the funding before
the appropriation reaches the project office. 

We agree that the requirements for program funding are uncertain. 
However, program documents did not support a requirement for the
entire $117 million.  In addition, program officials informed us that
the contract renegotiation will include a decreased scope of work as
well as a program stretchout.  Furthermore, we note cost estimates on
which budget submissions are based include amounts for risk. 

We also agree that the project office does not receive the amount of
funds that are withheld for small business innovative research. 
However, we note that authorizing legislation indicates that the
Army, not the individual project office, is tasked to provide funding
for small business innovative research. 


         PRODUCT IMPROVEMENT
         PROGRAM
----------------------------------------------------- Appendix I:5.1.2

The Army requested $13.1 million to continue a study for an improved
warhead and seeker.  However, the Army has not determined that the
submunition improvement is the most efficient and effective
alternative for accomplishing the mission.  There are other
alternatives that the Army and the other services have proposed for
at least a part of this mission.  For example, the Army Tactical
Missile System improvement is designed to, among other tasks, engage
mobile missile launchers, and the Air Force's Joint Direct Attack
Munitions Program is also to accomplish that task.  An official from
the Office of the Assistant Secretary of the Army for Research,
Development, and Acquisition said that the systems were
complementary, rather than duplicative.  The Congress, thus, can
restrict obligational authority for the product improvement program
until the Secretary of Defense determines the most cost-effective
system(s) for that mission. 

The project manager said that $8.1 million for fiscal year 1994 would
be required to complete the initial study and provide data needed to
assess the cost-effectiveness of alternatives.  If the Congress
wishes to fund studies from the Brilliant Antiarmor Submunition's
appropriation, $5 million of the request can be restricted until the
alternatives are assessed. 



                               Table I.6
                
                Brilliant Antiarmor Submunition Funding/
                  Request and Potential Reduction and
                              Restriction

                         (Dollars in millions)


Budget line                               1992        1993        1994
----------------------------------  ----------  ----------  ----------
127                                   $118.286    $114.835    $117.008
Potential reduction                          -           -       7.000
Potential restriction                        -           -       5.000
----------------------------------------------------------------------

   AVIATION-ADVANCED DEVELOPMENT
--------------------------------------------------------- Appendix I:6

For fiscal year 1993, the Congress provided approximately $16.3
million to the Army for Aviation-Advanced Development.  Included in
this amount was $11.1 million for Aviation Life Support Equipment,
$2.4 million more than the Army had sought.  This project provides
for the engineering development of support equipment that is needed
for Army air crews' survival on the battlefield. 


      RESULTS OF ANALYSIS
------------------------------------------------------- Appendix I:6.1

Unless the Congress remains convinced that these funds are needed,
the Congress can rescind $2.4 million of the Army's fiscal year 1993
unobligated funds for Aviation-Advanced Development because the Army
has no plans to expend these funds for the program for which they
were provided.  A project official said there were no requirements
for these funds. 



                               Table I.7
                
                 Aviation-Advanced Development Funding/
                    Request and Potential Rescission

                         (Dollars in millions)


Budget line                               1992        1993        1994
----------------------------------  ----------  ----------  ----------
89                                     $13.681     $16.304     $10.759
Potential rescission                         -       2.400           -
----------------------------------------------------------------------

   OTHER MISSILE PRODUCT
   IMPROVEMENT PROGRAMS
--------------------------------------------------------- Appendix I:7

The Army included funding for the Army Tactical Missile System in its
request for other missile product improvement programs.  The missile
system is a surface-to-surface missile capable of destroying targets
in the rear area of an enemy's defense.  The missiles are fired from
a modified Multiple Launch Rocket System launcher and are intended
for use primarily against surface-to-surface missile sites; air
defense systems; command, control, and communication sites; and other
high-value military targets. 

The Army plans to begin a product improvement for the missile system
in fiscal year 1994 in order to engage similar targets at longer
ranges as well as mobile missile launchers.  The program's goal is to
provide more accurate information to the missile's guidance system
and increase the speed and range of the missile. 


      RESULTS OF ANALYSIS
------------------------------------------------------- Appendix I:7.1

The Army's fiscal year 1994 request of approximately $66.4 million
for other missile product improvement programs includes $25.8 million
for the Army Tactical Missile System.  The Congress can restrict
obligational authority for $16.9 million of that amount until the
improvement program is determined to be the most cost-effective
method of accomplishing the mission. 

The $25.8 million request includes $8.9 million for a DOD
analysis--Joint Precision Strike Demonstration--and $16.9 million for
efforts related to the improvement program.  However, the Army has
not determined that the improvement is the most cost-effective
solution for accomplishing the mission.  There are other alternatives
that the Army and the other services have proposed for at least part
of this mission.  Two alternatives are the Army's improvement to the
Brilliant Antiarmor Submunition program to engage mobile missile
launchers and the Air Force's Joint Direct Attack Munitions program. 
Therefore, the Congress can restrict obligational authority for $16.9
million until the Secretary of Defense determines that the product
improvement program is the most efficient and effective system for
accomplishing the mission. 

The deputy project manager agreed that the improvement program has
common targets with other improvement programs, yet he and other Army
and Air Force officials maintained that the systems are complementary
rather than duplicative.  The deputy also said that (1) funding would
not be required for the Army Tactical Missile System improvement
program until December 1993 and (2) a cost-effectiveness analysis
would be completed by that time. 



                               Table I.8
                
                   Other Missile Product Improvement
                 Programs Funding/Request and Potential
                              Restriction

                         (Dollars in millions)


Budget line                               1992        1993      1994\a
----------------------------------  ----------  ----------  ----------
154                                    $54.420      $4.729     $66.438
Potential restriction                        -           -      16.900
----------------------------------------------------------------------
\a Our review of this budget line included only the $25.8 million for
the Army Tactical Missile System budget request. 


POTENTIAL REDUCTIONS AND
RESCISSIONS IN NAVY RDT&E PROGRAMS
========================================================== Appendix II

We identified about $8.4 million in potential reductions in the
Navy's fiscal year 1994 RDT&E request and about $18.5 million in
potential rescissions in the Navy's fiscal years 1992 and 1993
funding.  The following section provides a brief description of our
analysis and proposed actions by program.  The proposed actions are
summarized in table II.1. 



                                    Table II.1
                     
                       Summary of Potential Reductions and
                           Rescissions in Navy Programs

                              (Dollars in millions)

                      Potential fiscal       Potential
                             year 1994      prior year       Potential
Program                     reductions     rescissions    restrictions  See page
--------------------  ----------------  --------------  --------------  --------
Generic Logistics                    -          $1.484               -        17
 Research and
 Development
 Technology
 Demonstrations
Advanced Anti-                       -           2.824               -        18
 Submarine Warfare
 Technology
Satellite Laser                      -          14.226               -        18
 Communications
Electronic Warfare              $8.361               -               -        19
 Development
 Total                      $8.361         $18.534               -
--------------------------------------------------------------------------------

   GENERIC LOGISTICS RESEARCH AND
   DEVELOPMENT TECHNOLOGY
   DEMONSTRATIONS
-------------------------------------------------------- Appendix II:1

This line item funds development studies to demonstrate the
feasibility of using advanced technology to improve future operations
in Navy logistics areas.  One of the studies, the Rapid Acquisition
of Manufactured Parts, is to evaluate the technologies that a depot
maintenance facility uses and to demonstrate that the use of advanced
technologies can reduce manufacturing costs and lead times for spare
and replacement parts.  The Philadelphia Naval Shipyard maintenance
facility is scheduled for a Rapid Acquisition of Manufactured Parts
study. 


      RESULTS OF ANALYSIS
------------------------------------------------------ Appendix II:1.1

The Congress can rescind about $1.5 million of the Navy's fiscal year
1993 funds of approximately $28.5 million for a Rapid Acquisition of
Manufactured Parts study of the maintenance facility at the
Philadelphia Naval Shipyard because the study is not appropriate. 
The Philadelphia Naval Shipyard is scheduled for closure under the
1991 Defense Base Closure and Realignment Commission process. 



                               Table II.2
                
                     Generic Logistics Research and
                 Development Technology Demonstrations
                Funding/Request and Potential Rescission

                         (Dollars in millions)


Budget line                               1992        1993        1994
----------------------------------  ----------  ----------  ----------
25                                     $17.838     $28.549     $13.720
Potential rescission                         -       1.484           -
----------------------------------------------------------------------

   ADVANCED ANTI-SUBMARINE WARFARE
   TECHNOLOGY
-------------------------------------------------------- Appendix II:2

The Navy is shifting its focus from "blue water" anti-submarine
warfare to shallow water anti-submarine warfare to address regional
conflict scenarios.  The Advanced Anti-Submarine Warfare Technology
program is designed to transition technology developments into
existing and future systems to ensure that U.S.  naval forces
maintain their technological advantage with a minimal investment. 

Fiscal year 1993 funds of about $74.8 million provided for seven
technology transition projects.  These projects were (1) Undersea
Warfare Advanced Technology Demonstration (approximately $13.9
million), (2) Critical Sea Tests (approximately $27.8 million), (3)
Advanced Deployable Array (approximately $3.6 million), (4) Advanced
Collection Technology (approximately $10.5 million), (5)
Anti-Submarine Warfare Target ($2 million), (6) Low Frequency
Technology (approximately $14.2 million), and (7) Shallow Water
Anti-Submarine Warfare System (approximately $2.8 million). 


      RESULTS OF ANALYSIS
------------------------------------------------------ Appendix II:2.1

The Congress can rescind approximately $2.8 million of the Navy's
fiscal year 1993 funds for the Shallow Water Anti-Submarine Warfare
project because the project duplicates ongoing work.  According to
Navy program officials, the Shallow Water Anti-Submarine Warfare
project duplicates projects such as those in the Undersea
Surveillance and Weapons Technology program. 



                               Table II.3
                
                    Advanced Anti-Submarine Warfare
                Technology Funding/Request and Potential
                               Rescission

                         (Dollars in millions)


Budget line                               1992        1993        1994
----------------------------------  ----------  ----------  ----------
26                                     $50.908     $74.838     $49.172
Potential rescission                         -       2.824           -
----------------------------------------------------------------------

   SATELLITE LASER COMMUNICATIONS
-------------------------------------------------------- Appendix II:3

In fiscal year 1992, the Congress provided $10 million to study the
feasibility of using laser technology to communicate with submarines. 
In fiscal year 1993, the Congress provided an additional $15 million
and directed the Navy to use the total amount of $25 million to (1)
plan and execute a fleet demonstration of a laser communications
system between an aircraft and a submarine and (2) plan a follow-on
submarine laser communications system, to include the evaluation of
effectiveness and cost of satellite versus those of aircraft. 


      RESULTS OF ANALYSIS
------------------------------------------------------ Appendix II:3.1

Unless the Congress remains convinced that these funds are needed,
the Congress can rescind the fiscal year 1993 funding of about $14.2
million for satellite laser communications because the Navy does not
plan to use the funds for the purposes for which they were provided. 

The program executive officer for the Satellite Laser Communications
program told us that the Navy has adequate submarine communications
capabilities and does not need additional systems.  He also told us
that the Navy had informed the Congress that it would not use fiscal
years 1992 and 1993 funds for laser communications development and
that the development of laser technology as another means for
submarine communications is no longer advisable. 



                               Table II.4
                
                 Satellite Laser Communications Funding
                        and Potential Rescission

                         (Dollars in millions)


Budget line                               1992        1993        1994
----------------------------------  ----------  ----------  ----------
32                                     $10.000     $14.226           -
Potential rescission                         -      14.226           -
----------------------------------------------------------------------

   ELECTRONIC WARFARE DEVELOPMENT
-------------------------------------------------------- Appendix II:4

The Electronic Warfare Development program includes several projects
that are directed at the development of electronic warfare systems
for the Navy.  One project involves the development of the AN/ALQ-165
airborne self protection jammer, which is designed to provide
defensive electromagnetic countermeasures for the self-protection of
the F/A-18E aircraft. 


      RESULTS OF ANALYSIS
------------------------------------------------------ Appendix II:4.1

The Navy's fiscal year 1994 budget request of about $128.9 million
for the electronic warfare development program can be reduced by
approximately $8.4 million because the Navy's budget justification
documents show that this amount was for the AN/ALQ-165 airborne self
protection jammer project.  The project was terminated in late 1992
because the Navy's August 1992 operational evaluation report found
that the AN/ALQ-165 jammer was neither operationally suitable nor
operationally effective.  In December 1992, the Assistant Secretary
of the Navy, Research, Development, and Acquisition directed that all
AN/ALQ-165 jammer production contracts be terminated. 



                               Table II.5
                
                Electronic Warfare Development Funding/
                    Request and Potential Reduction

                         (Dollars in millions)


Budget line                               1992        1993        1994
----------------------------------  ----------  ----------  ----------
109                                    $73.674    $134.377    $128.850
Potential reduction                          -           -       8.361
----------------------------------------------------------------------

POTENTIAL REDUCTIONS, RESCISSIONS,
AND RESTRICTIONS TO AIR FORCE
RDT&E PROGRAMS
========================================================= Appendix III

We identified about $415.3 million in potential reductions in the Air
Force's fiscal year 1994 RDT&E request, about $7.4 million in
potential rescissions in the Air Force's fiscal years 1992 and 1993
funding, and about $142.4 million in potential restrictions to the
Air Force's obligational authority for fiscal year 1994 requests. 
The following section provides a brief description of our analysis
and proposed actions by program.  The proposed actions are summarized
in table III.1. 



                                   Table III.1
                     
                         Summary of Potential Reductions,
                       Rescissions, and Restrictions to Air
                                  Force Programs

                              (Dollars in millions)

                      Potential fiscal       Potential
                             year 1994      prior year       Potential
Program                     reductions     rescissions    restrictions  See page
--------------------  ----------------  --------------  --------------  --------
National Aero-Space                  -               -         $30.000        21
 Plane Technology
 Program
Advanced Cruise                      -          $6.373               -        23
 Missile Program
Defense Support                      -           1.000               -        24
 Program-Ground
 Station Upgrade
Specialized                    $38.375               -               -        24
 Undergraduate Pilot
 Training
F-22 Advanced                  325.800               -               -        26
 Tactical Fighter
Night/Precision                 46.710               -          35.500        27
 Attack
F-16 Squadrons                   4.400               -          23.000        28
Spacelifter                          -               -          53.906        29
================================================================================
Total                         $415.285          $7.373        $142.406
--------------------------------------------------------------------------------

   NATIONAL AERO-SPACE PLANE
   TECHNOLOGY PROGRAM
------------------------------------------------------- Appendix III:1

The National Aero-Space Plane Technology Program is a joint DOD and
National Aeronautics and Space Administration (NASA) technology
development and demonstration program.  The program's goal is to
provide the technological basis for future space launch and
hypersonic flight vehicles by developing critical or enabling
technologies, such as a scramjet engine.  DOD and NASA intended to
demonstrate these technologies by building and testing the X-30, a
manned experimental flight vehicle.  The Air Force, the lead agency,
has requested approximately $43.3 million in fiscal year 1994, while
NASA has requested $80 million. 


      RESULTS OF ANALYSIS
----------------------------------------------------- Appendix III:1.1

The Congress can restrict obligational authority for $30 million of
the total of about $123.3 million requested for fiscal year 1994
pending decisions on the aerospace plane program's future direction
and resolution of programmatic and funding concerns.  The balance of
the request is sufficient to complete efforts already started. 

Under previous plans, a decision had been scheduled for September
1993 on whether to enter the program's next phase and begin building
the X-30.  However, large increases in the baseline program's
projected cost (from the original estimate of about $3.1 billion in
1986 to $17 billion in January 1992), funding constraints, and many
technical concerns caused DOD and NASA to reconsider entering the
next phase and led to efforts to restructure the current contract and
associated technical efforts. 

The program office proposed conducting a series of flight test
experiments and a concurrent ground test effort through the turn of
the century.  As of August 1993, however, the Office of Science and
Technology Policy, DOD, and NASA had not reached consensus on the
program's future direction and appropriate funding level. 

In our June 1993 report on the program,\1 we made several
recommendations to the Director of the Office of Science and
Technology Policy, the Secretary of Defense, and the Administrator of
NASA, that, if implemented, would (1) better focus the program's
long-term objectives and goals, (2) assure that sufficient funds are
budgeted to execute the program's next phase, and (3) allow
sufficient time to initiate required contractual action and properly
plan future efforts.  We also recommended that the Congress consider
restricting DOD and NASA from obligating any funds appropriated for
fiscal year 1994 beyond those necessary to complete the current
efforts until DOD and NASA complete certain tasks.  If implemented,
this recommendation would restrict the obligational authority of $30
million in fiscal year 1994 funds because these funds are to be used
to initiate future development efforts or to conduct additional
testing. 

Both NASA and Air Force officials agreed that our recommendations, if
implemented, would provide better program stability and focus. 
Program officials had no comment concerning the proposed restriction
of the fiscal year 1994 funding.  NASA officials, however, believe
restricting the fiscal year 1994 funds would be a burden to effective
planning and contracting.  While this funding restriction can be
imposed upon NASA, the Air Force, or a combination of both, the table
shows it applying only to the Air Force. 



                              Table III.2
                
                  National Aero-Space Plane Technology
                 Program Funding/Request and Potential
                              Restriction

                         (Dollars in millions)


Budget line                               1992        1993        1994
----------------------------------  ----------  ----------  ----------
29                                    $198.114    $141.244     $43.259
Potential restriction                        -           -      30.000
----------------------------------------------------------------------

--------------------
\1 National Aero-Space Plane:  A Need for Program Direction and
Funding Decisions (GAO/NSIAD-93-207, June 18, 1993). 


   ADVANCED CRUISE MISSILE PROGRAM
------------------------------------------------------- Appendix III:2

The Advanced Cruise Missile is a subsonic, turbo-fan powered missile
equipped with a nuclear warhead.  The Advanced Cruise Missile is
designed to be less detectable and have greater range, accuracy, and
operational flexibility than the Air Launched Cruise Missile.  The
Air Force began developing the Advanced Cruise Missile in 1982 and
has experienced significant development and production problems
leading to cost growth and schedule delays.  Development of the
Advanced Cruise Missile is complete; however, development continues
on depot support equipment, software, and other items.  The Air Force
has requested approximately $25.4 million in fiscal year 1994
Advanced Cruise Missile RDT&E funds, primarily for depot activation. 


      RESULTS OF ANALYSIS
----------------------------------------------------- Appendix III:2.1

The Congress can rescind about $6.4 million of the Advanced Cruise
Missile program's fiscal year 1993 unobligated funds because the Air
Force has no identified requirement for these funds.  To illustrate
the excess, the Air Force has $7.2 million in unused fiscal year 1992
funds that expire September 30, 1993. 

While acknowledging that they have no current requirements for the
approximately $6.4 million, program officials said these funds should
be retained to fund some future potential requirements.  However,
about $6.4 million is available for rescission because the Air Force
does not have a specific purpose for the funds after a full year. 



                              Table III.3
                
                Advanced Cruise Missile Funding/Request
                        and Potential Rescission

                         (Dollars in millions)


Budget line                               1992        1993        1994
----------------------------------  ----------  ----------  ----------
54                                     $39.300     $19.543     $25.393
Potential rescission                         -       6.373           -
----------------------------------------------------------------------

   DEFENSE SUPPORT PROGRAM-GROUND
   STATION UPGRADE
------------------------------------------------------- Appendix III:3

The Defense Support Program is a strategic surveillance and early
warning satellite system with an infrared capability to detect
ballistic missile launches.  It is designed to provide near real-time
detection information to support DOD's tactical warning and attack
mission.  The program is supported by a network of fixed and mobile
ground stations that process and disseminate information to military
commanders worldwide. 

In May 1987, the Air Force began procuring new computer hardware and
software for the ground stations.  The new equipment was designed to
replace the existing hardware and software and enhance operational
capability and address an evolving threat.  However, because of
significant cost growth and schedule slippage, the Air Force
terminated this effort, known as System I and the Ground Computer
Change Out programs, in December 1992.  The Air Force now plans to
upgrade the computer software and replace computer hardware. 


      RESULTS OF ANALYSIS
----------------------------------------------------- Appendix III:3.1

The Congress can rescind $1 million from the Air Force's Defense
Support Program fiscal year 1993 funds.  The $1 million in
unobligated fiscal year 1993 funds to be used for System I contract
termination is not needed.  According to a DOD official, sufficient
funds already have been obligated for the termination of the System I
contract.  Program officials stated that, if these funds were to be
retained by the program office, the $1 million should be used as a
management reserve to address uncertainties in such efforts as the
Satellite Readout Station Upgrade. 



                              Table III.4
                
                 Defense Support Program-Ground Station
                 Upgrade Funding/Request and Potential
                               Rescission

                         (Dollars in millions)


Budget line                               1992        1993        1994
----------------------------------  ----------  ----------  ----------
84                                           -     $49.081     $66.777
Potential rescission                         -       1.000           -
----------------------------------------------------------------------

   SPECIALIZED UNDERGRADUATE PILOT
   TRAINING
------------------------------------------------------- Appendix III:4

The Air Force's Specialized Undergraduate Pilot Training program
includes funding for the Joint Primary Training System.  The training
system is a joint Air Force and Navy venture to replace the services'
primary trainer aircraft (T-37 and T-34, respectively).  The program
includes the purchase of aircraft, simulators, ground-based training
devices, instructional courseware, and logistical support.  The
training system is to be used to train entry level students in the
fundamentals of flying.  The Air Force's fiscal year 1994 request for
approximately $44 million includes about $38.4 million for the
initial test aircraft and related costs and $3.2 million for program
office support costs. 


      RESULTS OF ANALYSIS
----------------------------------------------------- Appendix III:4.1

The Air Force's fiscal year 1994 request of approximately $44 million
can be reduced by about $38.4 million because the contract award date
for the initial test aircraft planned for August 1994 is expected to
be delayed until fiscal year 1995. 

Several factors have caused some slippage in the planned schedule for
source selection, and further slippage is probable.  On July 7, 1993,
the Under Secretary of Defense (Acquisition) issued formal direction
to the Air Force. 

  -- The Under Secretaries directed a one-contract initial
     acquisition strategy with the prime contractor responsible for
     integration of the training system during development.  This is
     a much different strategy than that used by the Air Force in
     establishing its current plans and schedule.  The Air Force had
     been planning to issue separate contracts for the aircraft and
     ground-based training system. 

  -- Some changes and additions to the strategy and source selection
     process were also directed that must be met before the Air Force
     receives milestone decision authority from the Office of the
     Secretary of Defense.  The Air Force is now required to (1)
     develop source selection criteria to clearly favor proposals
     involving lowest developmental risk and lowest total system
     cost, (2) resolve all test and evaluation master plan issues,
     and (3) ensure that the training system's program is fully
     consistent with DOD's policies on women in combat.  On this last
     point, the training system must accommodate not less than 80
     percent of the eligible female pilot candidates.  An Office of
     the Secretary of Defense working group is studying size and
     design requirements, and this study might result in changes
     having to be made in some contractors' training system
     candidates. 

This direction came months after the Air Force first developed the
schedule for source selection and established a contract award date
in August 1994.  Release of the final request for proposal is now
expected in January 1994--about 3 months later than planned--and
other schedule dates are also likely to slip. 

DOD has not yet specified the amount of "missionization"
(modifications to commercial designs needed to meet program
requirements) that will be permitted following operational evaluation
of candidates and selection of the prime contractor.  Training system
program officials said their intent is to limit such modifications
and require that the basic design, engine, and flying characteristics
be standardized at the time of operational evaluation. 

Program and Office of the Secretary of Defense officials also
acknowledged that the contract award is likely to slip into fiscal
year 1995 and agreed that fiscal year 1994 funds could be reduced. 
Officials said they needed $3.2 million in fiscal year 1994 funding
for program office and test support costs. 



                              Table III.5
                
                Specialized Undergraduate Pilot Training
                Funding/Request and Potential Reduction

                         (Dollars in millions)


Budget line                               1992        1993        1994
----------------------------------  ----------  ----------  ----------
100                                     $4.196      $4.392     $43.971
Potential reduction                          -           -      38.375
----------------------------------------------------------------------

   F-22 ADVANCED TACTICAL FIGHTER
------------------------------------------------------- Appendix III:5

The F-22 is to replace the F-15 as the Air Force's next air
superiority fighter.  The F-22 entered development in 1991, and the
Air Force plans to request production funding for fiscal year 1996. 
Plans are to achieve initial operational capability in 2003. 


      RESULTS OF ANALYSIS
----------------------------------------------------- Appendix III:5.1

The Air Force's fiscal year 1994 request of about $2,251 million for
the F-22 can be reduced by $325.8 million because the projected
threat does not appear to compel a faster pace of development. 

F-22 program officials maintain that a reduction of $325.8 million in
the fiscal year 1994 budget request would cause a 6- to 9-month
program delay and an estimated cost increase of $1 billion through
fiscal year 2001.  DOD believes that, no matter what the threat, the
F-22 will be considerably more efficient at the air superiority
mission than the F-15.  However, our analysis indicates that the
performance characteristics of the existing F-15 weapon system are
superior to those of the projected threat well beyond the planned
F-22 introduction in 2003.  We believe that maintaining the fiscal
year 1993 level of funding would be prudent for this reason and
because of the unknown impact of pending DOD decisions about mission
requirements and affordability of tactical aircraft. 



                              Table III.6
                
                F-22 Advanced Tactical Fighter Funding/
                    Request and Potential Reduction

                         (Dollars in millions)


Budget line                               1992        1993        1994
----------------------------------  ----------  ----------  ----------
102                                 $1,606.804  $1,925.199  $2,250.997
Potential reduction                          -           -     325.800
----------------------------------------------------------------------

   NIGHT/PRECISION ATTACK
------------------------------------------------------- Appendix III:6

The Night/Precision Attack program contains the night attack project
and the low altitude navigation and targeting infrared-for-night
project.  The first project, night attack, is to develop, test, and
evaluate night vision technologies for future enhancement to F-16 and
A-10 aircraft.  The second project, infrared-for-night, is to provide
the capability to conduct close air support and interdiction missions
at night and in conditions of limited visibility with laser guided
weapons.  The Air Force's fiscal year 1994 budget request includes
approximately $82.2 million for the Night/Precision Attack program. 


      RESULTS OF ANALYSIS
----------------------------------------------------- Appendix III:6.1

The Congress can reduce the Air Force's fiscal year 1994 budget
request by about $46.7 million for the Night/Precision Attack program
and restrict obligational authority for the remaining $35.5 million. 
The Office of the Secretary of Defense and the Air Force have not
reached agreement on which aircraft should be modified for the close
air support mission, how many should be modified, and what those
modifications should be.  As a result, the Congress restricted the
Air Force's fiscal year 1993 funding for close air support, which
includes the Night/Precision Attack program.  Although a Defense
Acquisition Board meeting was scheduled to discuss Air Force plans
for the program in December 1992, it was not held because the Office
of the Secretary of Defense requested the Air Force to further
support its planned program.  A Board meeting is not currently
scheduled, but an Office of the Secretary of Defense official said
one may be held by December 1993. 

The Air Force Night/Precision Attack program manager said the Air
Force requires only $35.5 million in fiscal year 1994 funding to
support the program that the Office of the Secretary of Defense wants
or only $24.4 million to support the program that the Air Force
wants.  Therefore, assuming the higher cost program is selected,
about $46.7 million is excess to the fiscal year 1994 needs.  Also,
the $35.5 million that is needed to fund the Office of the Secretary
of Defense's program can be restricted until a decision is made on
which program is selected.  As of September 22, 1993, the differences
between the Office of the Secretary of Defense and the Air Force had
not been resolved. 



                              Table III.7
                
                 Night/Precision Attack Funding/Request
                and Potential Reduction and Restriction

                         (Dollars in millions)


Budget line                               1992        1993        1994
----------------------------------  ----------  ----------  ----------
104                                     $3.125     $25.094     $82.210
Potential reduction                          -           -      46.710
Potential restriction                        -           -      35.500
----------------------------------------------------------------------

   F-16 SQUADRONS
------------------------------------------------------- Appendix III:7

The Air Force's fiscal year 1994 RDT&E budget request for the F-16
includes $23 million to define requirements for close air support and
$4.4 million for multirole fighter concept development.  The Air
Force is considering the F-16 for the close air support mission of
providing support to friendly forces that are close to enemy forces. 
The multirole fighter was envisioned as a future aircraft designed
for a variety of missions. 


      RESULTS OF ANALYSIS
----------------------------------------------------- Appendix III:7.1

The Congress can restrict the Air Force's obligational authority for
$23 million requested in fiscal year 1994 for development efforts
related to modifications of F-16s for close air support because the
Office of the Secretary of Defense and the Air Force have not agreed
on which configuration of the F-16 should be modified for the close
air support mission, how many aircraft should be modified, and what
those modifications should be.  Further, the Congress can reduce the
request by $4.4 million for the multirole fighter program because the
Secretary of Defense canceled the program in September 1993. 


      CLOSE AIR SUPPORT
----------------------------------------------------- Appendix III:7.2

As a result of the Office of the Secretary of Defense and the Air
Force's disagreement regarding the F-16 and the close air support
mission, the Congress restricted all $3.5 million appropriated for
the Air Force's fiscal year 1993 funding for close air support.  A
Defense Acquisition Board meeting was scheduled to discuss Air Force
plans for the close air support program in December 1992, but it was
not held because the Office of the Secretary of Defense requested the
Air Force to further justify its planned program.  A Board meeting is
not currently scheduled. 

Because the fiscal year 1993 funds were restricted by the Congress
and the disagreement still is not resolved, the Congress can restrict
the Air Force's authority to obligate fiscal year 1994 funds.  The
funds can be released and the Air Force can proceed with
accomplishing early planning tasks, such as defining its requirements
and setting specifications, when the Office of the Secretary of
Defense and the Air Force agree on the close air support program. 


      MULTIROLE FIGHTER
----------------------------------------------------- Appendix III:7.3

In the fiscal year 1993 request for development planning projects,
the Air Force requested $4.9 million to initiate multirole fighter
studies.  The Congress denied the request because it believed it was
too early to decide whether an entirely new aircraft should be
developed.  The Congress stated that funds approved for development
planning could be used for multirole fighter studies only after the
Air Force submitted a detailed justification and received approval
from the Committees on Appropriations. 

As a result of the recent DOD bottom-up review, the Secretary of
Defense canceled the multirole fighter program.  Thus, the Congress
can reduce the fiscal year 1994 request for funding of the multirole
fighter program because it was canceled. 



                              Table III.8
                
                   F-16 Squadrons Funding/Request and
                  Potential Reduction and Restriction

                         (Dollars in millions)


Budget line                               1992        1993        1994
----------------------------------  ----------  ----------  ----------
130                                   $147.661    $109.409    $116.947
Potential reduction (multirole               -           -       4.400
 fighter)
Potential restriction (close air             -           -      23.000
 support)
----------------------------------------------------------------------

   SPACELIFTER
------------------------------------------------------- Appendix III:8

The Spacelifter is a new fiscal year 1994 program established to
replace the National Launch System program that was terminated in
fiscal year 1993.  The Spacelifter is designed to provide DOD, as
well as civil and commercial users, with a medium-to-heavy launch
capability by the first decade of the next century. 


      RESULTS OF ANALYSIS
----------------------------------------------------- Appendix III:8.1

To prevent premature commitment to a long-term effort on the
Spacelifter program, the Congress can restrict Air Force obligational
authority on the fiscal year 1994 request for approximately $53.9
million.  The Air Force and DOD have not resolved schedule,
requirements, and funding/affordability issues associated with the
program. 

Several issues must be resolved before the program can be initiated. 
Most importantly, as noted by the Vice President's Space Policy
Advisory Board, no strong economic imperative or critical payload
requirement drives the development of a new space launch capability. 
The report further noted that launch rates are declining, which will
extend the life of the current Delta, Atlas, and Titan family of
vehicles.  For example, the Titan IV program office estimates it can
support required satellite launches of Defense Support Program,
Milstar, Follow-on Early Warning System, NASA, and classified
programs through 2014, if its follow-on buy of launch vehicles
proceeds as scheduled. 

Also, a validated mission needs statement for the Spacelifter program
should be completed before the program begins its initial
development.  According to DOD Instruction 5000.2, DOD entities shall
document deficiencies in current capabilities and opportunities to
provide new capabilities in a mission needs statement.  Air Force
officials agreed that the validated document is essential to begin
the first phase of the program--concept exploration.  Although the
Air Force Space Command has prepared a draft mission needs statement,
an Air Force Space Command official was unsure when the document
would be approved by the head of the U.S.  Space Command. 

The Air Force's obligational authority on the fiscal year 1994 budget
request for approximately $53.9 million for Spacelifter can be
restricted until the Air Force and DOD provide the Congress assurance
that schedule, funding, and requirements issues are resolved. 



                              Table III.9
                
                    Spacelifter Funding/Request and
                         Potential Restriction

                         (Dollars in millions)


Budget line                               1992        1993        1994
----------------------------------  ----------  ----------  ----------
190                                    $48.673      $9.435     $53.906
Potential restriction                        -           -      53.906
----------------------------------------------------------------------

POTENTIAL REDUCTIONS AND
RESTRICTIONS TO MULTISERVICE RDT&E
PROGRAMS
========================================================== Appendix IV

We identified about $34.8 million in potential reductions in the Air
Force's and about $27.2 million in potential restrictions to the
Navy's obligational authority for fiscal year 1994 RDT&E requests. 
The following section provides a brief description of our analysis
and proposed actions by program.  The proposed actions are summarized
in table IV.1. 



                                    Table IV.1
                     
                       Summary of Potential Reductions and
                      Restrictions to Multiservice Programs

                              (Dollars in millions)

                      Potential fiscal       Potential
                             year 1994      prior year       Potential
Program                     reductions     rescissions    restrictions  See page
--------------------  ----------------  --------------  --------------  --------
Advanced Tactical              $34.838               -               -        31
 Air Reconnaissance
 System, Air Force
Advanced Tactical                    -               -         $27.217        31
 Air Reconnaissance
 System, Navy
================================================================================
Total                          $34.838               -         $27.217
--------------------------------------------------------------------------------

   ADVANCED TACTICAL AIR
   RECONNAISSANCE SYSTEM
-------------------------------------------------------- Appendix IV:1

The fiscal year 1994 request for the Advanced Tactical Air
Reconnaissance System is included in the requests for the Air Force
Follow-On Tactical Reconnaissance System and the Navy Tactical
Airborne Reconnaissance System.  The Advanced Tactical Air
Reconnaissance System program was being designed to replace obsolete
wet-film photographic reconnaissance systems that DOD officials
stated were not adequate during Operation Desert Shield/Storm. 
Aircraft equipped with the reconnaissance system's sensor suites were
to provide near-real time collection of battlefield information for
tactical use such as bomb damage assessment.  The system was a joint
Air Force and Navy program.  The Air Force was the executive service
for the development of the program. 


      RESULTS OF ANALYSIS
------------------------------------------------------ Appendix IV:1.1

The Congress can reduce the Air Force's fiscal year 1994 budget
request for the Advanced Tactical Air Reconnaissance System by about
$34.8 million because the system's contract was terminated effective
June 25, 1993, due to cost, schedule, and performance problems. 
About $20 million in remaining funds is for developing a replacement
program strategy to meet operational requirements for tactical
reconnaissance.  In addition, the Congress can restrict obligational
authority for approximately $27.2 million of the Navy's fiscal year
1994 request for the system until the Navy develops a viable
replacement program strategy to meet its operational requirements for
tactical reconnaissance and advises the Congress of that plan. 

Air Force program officials agreed that the Air Force's fiscal year
1994 budget request can be reduced by approximately $34.8 million.  A
Navy program official expressed concern that restricting about $27.2
million of the Navy's fiscal year 1994 budget request until a program
strategy is developed might impede Navy efforts to continue testing
sensors already received.  However, until the Navy decides what
sensors it plans to use, the Navy may not be testing the sensors that
will be selected for the replacement program. 



                               Table IV.2
                
                  Advanced Tactical Air Reconnaissance
                  System Funding/Request and Potential
                       Reduction and Restriction

                         (Dollars in millions)


Budget line                               1992        1993        1994
----------------------------------  ----------  ----------  ----------
138 (Air Force)                        $87.391     $58.362     $65.338
Potential reduction                          -           -      34.838
46 (Navy)                               13.776      14.444      30.358
Potential restriction                        -           -      27.217
----------------------------------------------------------------------

POTENTIAL RESTRICTIONS TO
DEFENSEWIDE RDT&E PROGRAMS
=========================================================== Appendix V

We identified about $766.8 million in potential restrictions to the
Defensewide fiscal year 1994 RDT&E request.  The following section
provides a brief description of our analysis and proposed actions by
program.  The proposed actions are summarized in table V.1. 



                                    Table V.1
                     
                       Summary of Potential Restrictions to
                               Defensewide Programs

                              (Dollars in millions)

                      Potential fiscal       Potential
                             year 1994      prior year       Potential
Program                     reductions     rescissions    restrictions  See page
--------------------  ----------------  --------------  --------------  --------
Theater Missile                      -               -        $718.381        33
 Defenses
Theater Missile                      -               -          48.457        35
 Defenses
 (Engineering and
 Manufacturing
 Development)
================================================================================
Total                                -               -        $766.838
--------------------------------------------------------------------------------

   THEATER MISSILE DEFENSES
--------------------------------------------------------- Appendix V:1

The Missile Defense Act of 1991 established the necessity of a
ballistic missile defense for the United States and its allies and
U.S.  forces deployed worldwide.  The Ballistic Missile Defense
Organization (BMDO) was charged with developing a theater missile
defense.  To accomplish this goal, BMDO plans a two-tier defense. 
The upper tier defense, which will provide for wide area defense,
consists of the Theater High Altitude Area Defense missile system. 
The lower tier defense, which will defend critical assets, will be
provided by the Patriot Advanced Capability-Three (PAC-3) missile
system. 

The Theater High Altitude Area Defense is a transportable
antitactical ballistic missile system consisting of missiles,
launchers, radars, and tactical operational centers.  The Theater
Missile Defense-Ground Based Radar, the radar supporting the Theater
High Altitude Area Defense, is a mobile, ground-based radar that will
provide early warning, target cuing, and missile fire control. 

The lower tier mission will be filled by the PAC-3 missile system. 
The systems that are competing to be the PAC-3 missile are (1) the
Extended Range Interceptor, which is designed to destroy missiles by
colliding with them, and (2) the Patriot Multimode Missile, which
includes seeker and explosive warhead improvements.  BMDO plans to
select a system for engineering and manufacturing development in
February 1994. 


      RESULTS OF ANALYSIS
------------------------------------------------------- Appendix V:1.1

The Congress can restrict obligational authority for about $718.4
million (approximately $484.3 million for the Theater High Altitude
Area Defense missile and about $234.1 million for the Theater Missile
Defense-Ground Based Radar) of BMDO's approximate $1.6 billion fiscal
year 1994 request for Theater Missile Defense until a determination
is made as to whether the area defense missile and the radar comply
with the Anti-ballistic Missile Treaty. 

Obligational authority can be restricted for BMDO's entire request
for the area defense missile and the radar because there are
questions concerning whether development of these systems complies
with the treaty.  In November 1992, the former Under Secretary of
Defense (Acquisition) expressed concern regarding the area defense
missile's unresolved treaty status because the treaty may preclude
the development of some theater missile defense system capabilities. 
Although the treaty does not limit defenses against theater and
tactical ballistic missiles, it does prohibit the development of
mobile land-based systems that could defend against strategic
missiles.  The Under Secretary wanted to ensure a compliance
determination as early as possible in the acquisition to minimize the
likelihood of unnecessarily expending funds by designing a system
that does not comply with the treaty. 

Therefore, the Under Secretary mandated treaty compliance
determination prior to the area defense missile's final design
review, scheduled for November 1993.  He further stated that the area
defense missile should not proceed beyond the final design review
until he certifies that it is compliant with the treaty. 

According to a Theater High Altitude Area Defense project official,
BMDO briefed the DOD Compliance Review Group in May 1993.  However,
according to the project manager, the group did not document its
conclusions, and the Under Secretary has not certified that the area
defense missile is compliant with the treaty--an action necessary to
proceed beyond the final design review.  In addition, the Senate
Committee on Armed Services recently directed the Secretary of
Defense to begin reviewing the Theater High Altitude area defense
missile's compliance with the treaty. 

The determination of the area defense missile's treaty compliance
status directly impacts the ground-based radar.  According to the
ground-based radar deputy project manager, if the missile is not
compliant with treaty provisions, the radar would also be
noncompliant because it supports the missile system.  By itself,
however, the radar is considered treaty compliant because the
aperture of the radar is below the maximum level imposed by the
treaty. 

The area defense missile project manager said that restricting all
fiscal year 1994 funding would severely affect program cost and
schedule.  He said that sufficient funding would be needed to
continue basic program operations; however, he did not estimate the
amount of funding required.  In addition, a ground-based radar
acquisition official stated that the radar also would require
sufficient funding to continue basic operations, yet he did not
estimate the amount of funding required.  A BMDO official added that
restriction of obligational authority for the entire appropriation
for both systems would delay the final design review, which would
cause a nonrecoverable program slippage.  However, the Congress can
restrict the entire fiscal year 1994 obligational authority until
BMDO estimates and justifies the amount of funding required for basic
operations.  A program slippage may be preferable over spending funds
to develop a system that is not treaty compliant. 



                               Table V.2
                
                   Theater Missile Defenses Funding/
                   Request and Potential Restriction

                         (Dollars in millions)


Budget line                               1992        1993        1994
----------------------------------  ----------  ----------  ----------
75                                           -  $1,018.110  $1,636.304
Potential restriction                        -           -     718.381
----------------------------------------------------------------------

   THEATER MISSILE DEFENSES
   (ENGINEERING AND MANUFACTURING
   DEVELOPMENT)
--------------------------------------------------------- Appendix V:2

The Missile Defense Act of 1991 established the necessity of
ballistic missile defense for the United States and its allies and
worldwide U.S.  forces.  BMDO, charged with developing a theater
missile defense, plans a two-tier defense.  The upper tier will
provide for wide area defense.  The lower tier, to be used for
defending critical assets, will be provided by the PAC-3 missile
system. 

The Patriot is a surface-to-air missile system that consists of a
radar, ground support equipment, missile launchers, and missiles.  An
upgrade of the Patriot with an improved seeker and explosive warhead,
the Patriot Multimode Interceptor, is competing against the Extended
Range Interceptor for the role of the PAC-3 missile.  One of these
two missile development systems will be selected to transition to
engineering and manufacturing and will fulfill the PAC-3 role. 


      RESULTS OF ANALYSIS
------------------------------------------------------- Appendix V:2.1

BMDO requested approximately $50.4 million in fiscal year 1994 for
Theater Missile Defense engineering and manufacturing development. 
The Congress can restrict obligational authority for about $48.5
million until the PAC-3 missile is selected.  BMDO plans to use about
$48.5 million for Patriot multimode missile engineering and
manufacturing development.  However, BMDO will not know if Patriot
multimode engineering and manufacturing development funds are
required until the decision is made as to whether the Patriot
multimode or the Extended Range Interceptor will be selected for the
PAC-3 role.  That selection decision has been postponed until
February 1994. 

A BMDO official stated that one congressional authorization committee
has recommended that if engineering and manufacturing development is
delayed, the funding could be used to continue demonstration and
validation.  He expressed concern that a restriction would prohibit
them from use of the funds for these efforts.  However, the funds
were requested for engineering and manufacturing development, not
demonstration and validation. 



                               Table V.3
                
                 Theater Missile Defenses (Engineering
                and Manufacturing Development) Funding/
                   Request and Potential Restriction

                         (Dollars in millions)


Budget line                               1992        1993        1994
----------------------------------  ----------  ----------  ----------
82                                           -      $9.390     $50.410
Potential restriction                        -           -      48.457
----------------------------------------------------------------------

SCOPE AND METHODOLOGY
========================================================== Appendix VI

We selected for detailed review DOD RDT&E programs that we identified
from our ongoing assignments as well as the survey phase of this
assignment as having cost, schedule, performance, or programmatic
issues.  To achieve our objectives, we interviewed program officials
and reviewed program documentation such as budget requests and
justifications, monthly program status reports, correspondence,
briefing reports, and accounting and financial reports.  We discussed
the facts in this report with DOD and program officials and
incorporated their comments as appropriate. 

We performed our work at numerous DOD and military service locations. 
For example, we visited the Air Force Materiel Command,
Wright-Patterson Air Force Base, Ohio; Army Missile Command and U.S. 
Ballistic Missile Defense Organization, Huntsville, Alabama; Naval
Sea Systems, Naval Space and Warfare, and Naval Air Systems Commands,
and the Office of the Chief of Naval Research, Arlington, Virginia;
Air Force Materiel Command Electronics Systems Center, Hanscom Air
Force Base, Massachusetts; Army Communications-Electronics Command,
Fort Monmouth, New Jersey; Army Tank-Automotive Command, Warren,
Michigan; Army Aviation and Troop Command, St.  Louis, Missouri; Air
Force Space and Missile System Center, Los Angeles, California; and
U.S.  and Air Force Space Commands, Colorado Springs, Colorado.  We
also contacted program representatives in the Office of the Secretary
of Defense and the Departments of the Army, the Navy, and the Air
Force. 

We performed our review from October 1992 through September 1993 in
accordance with generally accepted government auditing standards. 


MAJOR CONTRIBUTORS TO THIS REPORT
========================================================= Appendix VII

NATIONAL SECURITY AND
INTERNATIONAL AFFAIRS DIVISION,
WASHINGTON, D.C. 

Brad H.  Hathaway, Associate Director
Thomas J.  Schulz, Associate Director
Howard R.  Manning, Project Director
John J.  D'Esopo
Raymond Dunham
Jack B.  Guin
Steven F.  Kuhta
Robert D.  Murphy
Derek B.  Stewart
Robert J.  Stolba
William L.  Wright, Jr.
Lawrence W.  Gaston
Raymond W.  Allen
Wanda M.  Slagle
Sarah J.  Brady
Tana M.  Davis
Sharon E.  Sweeney

ATLANTA REGIONAL OFFICE

Thomas W.  Gilliam
Dayna L.  Foster
Marion S.  Chastain
Frederick W.  Felder
Carol T.  Mebane
Angel D.  Sharma
Dana S.  Solomon
John S.  Warren, Jr. 

BOSTON REGIONAL OFFICE

Edmund L.  Kelley, Jr.
Martin F.  Lobo
Joseph Rizzo, Jr.
Richard E.  Silveira

CINCINNATI REGIONAL OFFICE

Matthew R.  Mongin
John M.  Murphy, Jr.
Bruce D.  Fairbairn
Timothy J.  DiNapoli
Leonard L.  Benson
Michael F.  McGuire
John F.  Seidl
George J.  Buerger
Henry W.  Sudbrink II
Michael W.  Aiken
Edward R.  Browning
Johnetta Gatlin-Brown
Tom C.  Hewlett
Benjamin Jordan
Fred J.  Naas
Don M.  Springman

KANSAS CITY REGIONAL OFFICE

Gary L.  Billen
Charles O.  Burgess
Carole F.  Coffey
Milton E.  Roedder, Jr.
Lauri A.  Bischof
Dora E.  Navarro
Karen A.  Rieger
Norman W.  Trowbridge

LOS ANGELES REGIONAL OFFICE

Sam Van Wagner
Dale M.  Yuge
Frank Moore


*** End of document. ***