The Air Force Logistics Command ordered its spare parts buyers to spend as much money as possible in the last 10 days of 1985 because appropriated funds are piling up faster than the Air Force is using them, according to defense officials.
In a Dec. 20 message, the command ordered its 3,000 procurement employes to obligate funds "to the maximum extent possible" by Dec. 31. The message also cautioned that the desired haste should not override "constraints of law, directives, prudence and bona fide need rules."
Air Force Col. Robert F. Swarts said that on Dec. 1, two months after fiscal 1985 ended, the Air Force had $700 million left over from prior year spare parts budgets. The Air Force has fallen behind because of "turmoil" in spare parts buying, the colonel said, but not because Congress has appropriated more than the Air Force needs, as some critics have alleged.
Swarts, a logistician who works for the deputy Air Force chief of staff, said the Dec. 20 message followed "some pretty intense pressure" from top Defense Department officials on the Air Force to spend its spare parts budget faster. Those officials would not release the $3 billion budgeted for spare parts for fiscal 1986 until the Air Force spent more of its 1984 and 1985 money, Swarts said.
"There's been some tendency for them not to want to release a lot of our money," Swarts said. "So there has been a lot of pressure on us to show that we can get our program under control."
Richard E. Carver, assistant Air Force secretary for financial management, said, however, he believes the Air Force spare parts program now is under control, although efficient management lagged behind the increased funding that began in 1981. He said that fiscal 1985 was the best-managed year of the buildup, adding that only "semantical differences" and misunderstandings about Air Force accounting systems have prompted Defense Department officials to bottle up the 1986 funds.
"It's clear that a lot of this has come as a result of the ramp-up," Carver said. "There was an extraordinary increase in available funds, and not the concurrent increase in available personnel and systems to match that."
But in fiscal 1985, Carver said, the Air Force "committed" all its available spare parts funds in informal contract agreements. Those funds have not all been legally obligated, however, because the agreements must pass through "some additional procedures" and approvals, he said.
Both Carver and Swarts said that not only the increase in funds but also procurement reforms, both internal and those mandated by Congress, have slowed the buying process. More than 2,000 "competition advocates" and other spare parts specialists have been hired by the Air Force Logistics Command, Swarts said, in the wake of well-publicized "horror stories" about $1,100 stool caps and other overpriced parts.
Partly as a result, the command now takes more than 260 days to process spare parts orders of $100,000 or more, the officials said. Another two years will pass, on average, before those parts are actually delivered, according to Swarts.
Carver said the lead time peaked at more than 280 days and is now declining as efficiency improves. "The story in '85 is how we finally caught up," he said.
Critics have said that orders to speed spending encourage "unpriced orders," by which the Pentagon agrees to buy parts first and negotiates the exact price later. A recent report by the House Energy and Commerce oversight and investigations subcommittee said the Pentagon backlog of unpriced orders now totals $28 billion, a sign that the military is "so awash with procurement funds that it must resort to wasteful and irresponsible procurement practices."
But Carver said that the Air Force issued a strong directive several months ago -- a "real whack in the knuckles," he said -- to cut back on unpriced orders, which would not be undercut by the Dec. 20 message. And Swarts said that the message's advice on "constraints of law" and "prudence" would dampen any unwise enthusiasm.
"It won't cause people to do dumb things," he said.