For the second year in a row, Congress has tightened Defense Department accountability for large cost overruns on expensive weapon systems. The strict new disclosure requirements won final approval Wednesday night, when the House passed and sent to the White House the legislation authorizing funding of the Pentagon in the fiscal year starting Oct. 1.
The new reporting requirements are victories for Rep. Dave McCurdy (D-Okla.), a freshman member of the House Armed Services Committee, and Sen. Sam Nunn (D-Ga.), a senior member of the Senate Armed Services Committee. Over behind-the-scenes Pentagon opposition, the House-Senate conference on the fiscal 1983 Defense Authorization Act melded their complementary proposals.
McCurdy won adoption of language designed to prevent the Pentagon from dodging disclosure requirements in the future by claiming that programs such as the B1 manned bomber and the MX missile and MX base construction are not "major" even though each carries a price tag of about $28 billion.
Nunn began the accountability effort in May 1981, when the Senate voted 97 to 0 to adopt his amendment to the fiscal 1982 authorization bill for a one-year trial of disclosure requirements. Then, in a surprise maneuver on the House floor, Rep. Patricia Schroeder (D-Colo.) introduced and won passage of a resolution binding resistant House Armed Services Committee members to support the Nunn amendment in conference. The amendment became law last October.
Most important, the amendment set a cost baseline for each of the 50 expensive weapon systems classified as "major" by the Pentagon and directed it to file a report in Congress in any quarter in which a designated baseline is exceeded by at least 15 percent, above the inflation allowed for by the Office of Management and Budget. A cost growth exceeding 25 percent must be certified by the secretary of Defense.
Under the amendment, the Pentagon began in February to notify Capitol Hill of breaches of the 15 percent and 25 percent thresholds. By the end of July, the amendment had flushed out reports of tens of billions of dollars of overruns in 21 programs, as The Washington Post disclosed on Aug. 7.
Nunn fought for and won an indefinite extension of his amendment, which also requires managers of troubled large weapon programs to alert the secretaries of the Army, Navy or Air Force of problems.
The McCurdy language, building on the Nunn amendment, requires the Pentagon to make a comprehensive annual report on all weapon programs with research and development costs of at least $200 million or procurement costs of at least $1 billion and to file quarterly reports when a change occurs in a program's cost, performance or schedule.
He proposed the language after leading a special House Armed Services panel that reported unanimously in March that the Pentagon regularly was getting around a 1975 law requiring it to file quarterly Selected Acquisition Reports on the cost and status of "major" weapon programs, defined as those with expected outlays of more than $75 million for R&D and evaluation or more than $300 million for production.
The Pentagon did this simply by deciding that numerous huge programs were not "major." In May a Congressional Budget Office report listed six programs with a combined estimated cost of at least $70.6 billion that the Pentagon had classified as not "major."