Defense Transportation: 89th Airlift Wing Executive Branch Policies Improved but Reimbursement Issues Remain

Published by the Government Accountability Office on 1999-08-16.

Below is a raw (and likely hideous) rendition of the original report. (PDF)

                   United States General Accounting Office

GAO                Report to the Chairman, Committee on
                   Appropriations, U.S. Senate

August 1999
                   89 Airlift Wing
                   Executive Branch
                   Policies Improved but
                   Reimbursement Issues

United States General Accounting Office                                                   National Security and
Washington, D.C. 20548                                                             International Affairs Division

                                    B-282994                                                                   Letter

                                    August 16, 1999

                                    The Honorable Ted Stevens
                                    Chairman, Committee on Appropriations
                                    United States Senate

                                    Dear Mr. Chairman:

                                    In 1992, we issued a report on policies and procedures governing access to
                                    and use of the 89th Airlift Wing entitled Military Aircraft: Policies on
                                    Government Officials’ Use of 89th Military Airlift Wing Aircraft
                                    (GAO/NSIAD-92-133). We reported that the policies governing the use of
                                    military aircraft were too broad and vague to have much impact on the use
                                    of the 89th Airlift Wing by executive and legislative branch officials.
                                    Moreover, at that time, the use of aircraft was free of charge to all but a few
                                    users, and no one independently verified compliance with policies. We
                                    concluded that the policies and their implementation were inadequate and
                                    did not ensure that the wing’s airlift resources were being used
                                    appropriately and consistently. We made several recommendations
                                    designed to strengthen controls over uses of the 89th Airlift Wing and
                                    reimbursements for such uses.

                                    At your request, we determined whether (1) changes to executive branch
                                    policies since 1992 addressed the intent of our recommendations and
                                    (2) reimbursements have been made for use of 89th Airlift Wing aircraft.
                                    Because most of the missions flown by the 89th Airlift Wing are in support
                                    of the executive branch, we focused our analysis on the changes made to
                                    executive branch guidance concerning the use of government-owned
                                    aircraft, such as the Office of Management and Budget (OMB) Circular
                                    A-126 and other relevant Department of Defense (DOD) and White House
                                    implementing guidance. We are also providing you with information on
                                    which agencies of the government were the most frequent wing users
                                    during 1993-99 and how DOD resolves scheduling conflicts.

Results in Brief                    OMB, DOD, and the White House addressed our recommendations in
                                    policy revisions made since 1992, thus strengthening the management and
                                    use of the 89th Airlift Wing by defining key terms, specifying circumstances
                                    under which reimbursements are due, and requiring certain record-keeping
                                    measures. Requests to DOD for use of the wing generally complied with

                                    Page 1                                          GAO/NSIAD-99-170 Military Aircraft

             applicable policies on justifications for using the 89th Airlift Wing. However,
             DOD acknowledged that agency reimbursements for wing missions have
             generally not been collected for 2 years and in some cases for as long as 6
             years. Also, reimbursements for nonofficial travel in some cases were
             credited to the wrong accounts or the collection of the reimbursements
             could not be verified. Although in our 1992 report we noted problems with
             reimbursement processes, instructions to collect and account for them are
             still lacking. We are making a recommendation in this report to the
             Secretary of Defense to improve the billing and reimbursement process.

Background   The 89th Airlift Wing, located at Andrews Air Force Base, Maryland, is a
             component of the Air Force’s Air Mobility Command. The wing provides
             worldwide airlift for the President, Vice President, cabinet members, and
             other high-ranking dignitaries of the U.S. and foreign governments. As of
             June 1999, the wing had 20 fixed-wing aircraft and 19 helicopters. (The
             helicopters are used to meet transportation needs in the Washington, D.C.,
             area, and are not discussed in this report.) Table 1 displays the wing’s
             fixed-wing aircraft inventory.

             Table 1: The 89th Airlift Wing’s Inventory of Fixed-Wing Aircraft

                                                                    Number of
             Type                         Quantity                 passengers     Civilian aircraft variant
             VC-25A                                2                       76     Boeing 747
             C-32                                  4                       45     Boeing 757
             C-20B                                 5                       12     Gulfstream III
             C-20H                                 2                       12     Gulfstream IV
             C-9C                                  3                       42     Douglas DC-9
             C-137                                2a                 52 or 61b    Boeing 707
             C-37                                  2                       12     Gulfstream V
             One C-137 is scheduled to be retired from the inventory in August 1999.
             Passenger loads vary due to aircraft configuration.
             Source: 89th Airlift Wing.

             The two VC-25As are for the President’s exclusive use. However, the
             President also uses other aircraft as his transportation needs dictate. When
             the President is on board any of these aircraft, it is referred to as Air Force
             One. Other than the VC-25As, 89th Airlift Wing aircraft are available for

             Page 2                                                      GAO/NSIAD-99-170 Military Aircraft

                            executive, legislative, and judicial branch travel. The Office of the
                            Secretary of Defense (OSD) ranks missions in order of priority in the event
                            of a scheduling conflict according to (1) the lead traveler’s place on a DOD
                            priority ranking list or (2) the Secretary of Defense’s determination as to
                            the national interest of the proposed mission.

                            The 89th Airlift Wing’s flight operations are funded from annual
                            appropriations to the Air Force’s Operations and Maintenance (O&M)
                            account. The Air Mobility Command manages the portion of the O&M
                            account that funds the wing and certain other operations. The wing
                            reported that its overall budget for fiscal year 1999, including O&M and
                            other funds, is about $356.9 million for flight operations, civilian and
                            military payrolls, and the medical group.1

DOD Has Been the Most       The 89th Airlift Wing completed 4,562 missions from January 1, 1993,
Frequent User of the Wing   through February 9, 1999. Table 2 shows which government agencies used
                            wing aircraft most frequently.
Since 1993

                            Table 2: Usage of the 89th Airlift Wing by Agency

                                                                                                               Percentage of total
                            Agency                                        Number of missionsa                           missions
                            DOD                                                              1,979                               43.4
                            White House                                                      1,740                               38.1
                            Congress                                                           426                                 9.3
                            Department of State                                                245                                5.4b
                            Others                                                             172                                 3.8
                            Total                                                            4,562                                100
                             Many missions involved numerous trip segments, but if the mission number did not change, we
                            considered it to be one mission.
                                Includes missions ordered by either the White House or the Department of State.
                            Source: 89th Airlift Wing.

                                This includes base functions supporting non-89th Airlift Wing tenant units at Andrews Air Force Base.

                            Page 3                                                           GAO/NSIAD-99-170 Military Aircraft

Mission Request, Approval,   Request and approval procedures for missions vary depending on the
Scheduling, and              users. Normally, requests for trips directed by the President and approved
                             by the White House are sent by the White House Military Office directly to
Reimbursement Processes
                             the Air Force’s Office of the Vice Chief of Staff, Special Air Missions
for the 89th Airlift Wing    (hereafter referred to as the Office of Special Air Missions) for scheduling.
                             Members of Congress send requests to OSD (Legislative Affairs) for
                             approval. Executive branch cabinet department and agency requests that
                             are not sponsored by the White House, as well as OSD agency requests, are
                             sent to OSD (Executive Secretary) for approval. OSD (Legislative Affairs)
                             and OSD (Executive Secretary) send approved requests to the Office of
                             Special Air Missions for scheduling. The military services send approved
                             requests directly to the Office of Special Air Missions. After receiving
                             approval notification, the Office of Special Air Missions reviews the
                             proposed mission data and aircraft availability and then schedules the 89th
                             Airlift Wing to fly the mission.

                             DOD officials explained that sometimes they receive more approved
                             requests for transportation than they have aircraft available, which we
                             called “scheduling conflicts.” These officials said the Office of Special Air
                             Missions tries to resolve scheduling conflicts in consultation with the
                             affected customer by (1) changing the departure date or time; (2) changing
                             from the requested aircraft to another aircraft; (3) changing passenger
                             requirements (for example, requesting that the passenger group be reduced
                             so that it can be accommodated by a smaller, available aircraft); or
                             (4) placing the customer on a non-89th Airlift Wing aircraft. Air Force
                             officials explained that if the Office of Special Air Missions still cannot
                             resolve the conflict, it refers the matter to OSD (Executive Secretary) for
                             resolution. OSD (Executive Secretary) officials will then make a decision
                             by ranking the priority of travelers and usually scheduling the mission of
                             the lead traveler with the higher priority ranking. However, at times, these
                             officials stressed, the Secretary of Defense may determine that a particular
                             mission has a higher national interest and may schedule that mission
                             regardless of the priority ranking of the lead traveler. DOD does not require
                             that records be kept showing when a conflict has occurred and how it was
                             resolved, and such records were not kept.

                             Page 4                                        GAO/NSIAD-99-170 Military Aircraft

Under the Economy Act of 1932,2 DOD is required to collect
reimbursements for the cost of aircraft operations when it provides
89th Airlift Wing airlift support to non-DOD agencies except when the
support is at the direction of the White House. Reimbursements fall into
two categories: agency reimbursements and nonofficial traveler
reimbursements. Agencies make reimbursements for wing support through
transfers of appropriated funds to DOD. White House and White
House-directed missions are nonreimbursable, and DOD funds them. Other
non-DOD executive branch missions are reimbursable, and the agency is to
pay the full cost of operating the aircraft.3 Prior to 1996, the Air Force’s Air
Mobility Command billed agencies for reimbursements, collected them,
and credited the receipts to the Command’s O&M account. In 1996, the Air
Mobility Command transferred the agency billing and reimbursement
responsibility to DOD’s Defense Finance and Accounting Service (DFAS).
Thus, at the time of our review, DFAS did the billing and collections and
credited the receipts to the Air Mobility Command’s O&M account.

On the other hand, 89th Airlift Wing users may permit nonofficial travelers
on their missions as provided by OMB Circular A-126 and DOD Directive
4500.56. Nonofficial passengers may join in the mission if (1) the aircraft
was already scheduled for an official purpose, (2) the addition of such
passengers does not require a larger aircraft, and (3) results in a negligible
increase in aircraft operating costs. The agencies using the wing are also to
collect travel costs from nonofficial travelers at the rate of a commercial
coach class ticket to the destination traveled. For example, when the
Secretary of Defense permits nonofficial travelers to accompany him on
DOD aircraft, OSD (Personal Security) bills such travelers, except
members of the news media. OSD (Public Affairs) bills news media
representatives that accompany the Secretary of Defense on DOD aircraft.
These reimbursements are sent to DFAS to be credited to the Air Mobility
Command’s O&M account.

    31 U.S.C. §§ 1535, 1536.
 We did not evaluate the data used to set reimbursement rates that DOD charged non-DOD agencies for
reimbursable 89th Airlift Wing missions. However, in other unrelated work, DOD has acknowledged
fundamental problems in accumulating reliable cost information.

Page 5                                                      GAO/NSIAD-99-170 Military Aircraft

Policies Regarding Use   After our 1992 report, OMB, DOD, and the White House revised policies
                         related to the 89th Airlift Wing, strengthening the management and use of
and Management of the    the wing. Among these policies is OMB Circular A-126 (Improving the
89th Airlift Wing Have   Management and Use of Government Aircraft), a primary governing
                         directive on the use of military or other government aircraft by executive
Been Strengthened        branch officials. The 1989 version of the circular was in effect at the time of
                         our 1992 report, and we concluded that the circular (1) inadequately
                         defined key terms, (2) readily permitted travelers to assert that commercial
                         transportation was not available, (3) did not require comparison of the cost
                         of military versus commercial transportation, (4) did not clearly specify
                         when nonofficial travelers should pay for their trips, and (5) did not specify
                         the extent to which compliance with these policies should be documented
                         and controlled. Table 3 displays the changes that we recommended to the
                         circular and the changes OMB made.

                         Table 3: Actions Responding to Our 1992 Recommendations

                         1992 GAO recommendation                        OMB action
                         Clearly define key terms such as “official     Defined “mission requirements” and the
                         business” and describe how, when, by           purposes for which the wing can be used.
                         whom, and for what purposes the 89th Airlift   Defined “official travel.”
                         Wing should be used (or alternatively, the     Established criteria for designating a
                         purposes for which the 89th Airlift Wing       government official as a required user of
                         should not be used).                           government aircraft. Required users are
                                                                        officials who have a need for 24-hour-a-day
                                                                        secure communications or unusual security
                                                                        concerns and are thus allowed to use the
                                                                        89th Airlift Wing for all travel, including
                                                                        personal travel.
                                                                        Established the policy on when nonofficial
                                                                        travelers may travel on wing aircraft.
                         Provide specific guidance on how travelers     Established that commercial service is
                         should determine whether commercial            reasonably available if it can meet the
                         aircraft services are available.               traveler’s arrival or departure requirements
                                                                        within a 24-hour period.
                         Provide explicit guidance as to when and       Required a cost comparison unless the
                         how travelers are to make cost comparisons     travel is by a required user or to meet
                         and when it may be permissible not to use      mission requirements, two reasons for
                         the most cost-effective transportation         which the usually more expensive mode of
                         alternative.                                   government air transportation is permitted.

                         Page 6                                                  GAO/NSIAD-99-170 Military Aircraft

1992 GAO recommendation                           OMB action
Clearly identify the circumstances under          Specified that nonofficial travelers and
which both official and nonofficial travelers     official travelers on nonofficial business
should reimburse the government for their         must reimburse the government at the rate
travel and the appropriate amount to be           of a coach class air ticket to the destination
reimbursed.                                       traveled and identified the circumstances
                                                  under which reimbursements are due.
Clearly specify the extent to which               For each use of government aircraft,
compliance with each of these policies            required that data on the aircraft tail
should be documented and controlled,              number, the date(s) used, the names of the
where the documentation should be                 pilot and flight crew, the purpose of the
retained, and that documentation should be        flight, and the names of all passengers be
retained for at least 2 years after the date of   retained for at least 2 years.
the trip.
Source: GAO and OMB.

Also, since February 1993, the White House has revised at least three
memorandums that provide additional guidance on the use of DOD aircraft.
The latest memorandum, dated November 16, 1998, specifies the terms
under which non-DOD missions will be designated as either
nonreimbursable or reimbursable to DOD and the criteria for making such
decisions. White House support missions are provided on a
nonreimbursable basis and directly support (1) the President, Vice
President, and first family; (2) immediate White House activities; and
(3) missions directed by the President. For travel done by cabinet and
government officials not on White House missions, use of DOD aircraft can
be provided on a reimbursable basis if all of the following four conditions
are met: (1) the travel is in the national interest, (2) DOD is fully
reimbursed by the using agency at the appropriate flying hour rate, (3) the
use of resources does not detract from the national defense, and (4) a
commercial enterprise cannot provide the transportation as conveniently
or cost-effectively.

Finally, since 1992 DOD has issued at least four directives, memorandums,
or other guidance that affect the use of the wing. These documents, among
other things, implement the revised OMB circular, designate certain DOD
officials as required users, and emphasize that military air travel is a
premium mode of transportation involving high costs and limited
resources. For example, DOD Regulation 4515.13-R, Air Transportation
Eligibility, issued in November 1994, specifies procedures and criteria for
approving non-DOD airlift missions. For DOD to approve these missions,
the regulation requires the requester to justify the purpose of the travel,
state why commercial service is not being used, and indicate whether the
proposed mission will be reimbursable or nonreimbursable.

Page 7                                                      GAO/NSIAD-99-170 Military Aircraft

                         We reviewed a sample of mission requests that were reviewed by OSD
                         (Executive Secretary) and found that the justifications generally complied
                         with requirements outlined in OMB Circular A-126, the White House
                         memorandums, and DOD Regulation 4515.13-R regarding the use of
                         government aircraft.

DOD Has Not              Implementation of policies over the billing and reimbursement process for
                         89th Airlift Wing usage is inadequate. Problems included (1) a lack of agency
Collected                reimbursements to DOD for 89th Airlift Wing flights, (2) improper crediting
Reimbursements or        of funds that were reimbursed, (3) record-keeping that generally prevented
                         verification of transactions, and (4) inadequate instructions on how staff
Properly Accounted for   are to meet billing and reimbursement responsibilities. We identified
Them                     inadequate instructions as a problem in our 1992 report as well.

Some Agency              DOD acknowledged that it had not consistently collected agency
Reimbursements Are       reimbursements due for reimbursable missions. On the basis of our inquiry,
                         DOD discovered that reimbursements had not been collected for 63
6 Years in Arrears
                         missions flown by the 89th Airlift Wing, some occurring as long ago as 1993.4
                         We estimated that DOD is owed about $1.9 million from non-DOD agencies
                         for the 63 reimbursable missions. No one independently verified that all
                         agency reimbursements due were actually collected. Moreover, the Air
                         Mobility Command was not aware that any mission bills were in arrears,
                         even though the funds are to be credited to the Command’s O&M account.

                         The Air Force inquired into the billing problem and by June 1999, DFAS had
                         already sent bills for most of the outstanding reimbursements. As of July
                         1999, DFAS indicated that some reimbursements have been received. Also,
                         at the time of our review, the Office of Special Air Missions had begun to
                         develop a procedure to prevent a future recurrence of the problem. The
                         plan was still being developed at the time of this report.

                             Some agency reimbursements were collected between 1993 and 1996.

                         Page 8                                                      GAO/NSIAD-99-170 Military Aircraft

Some Nonofficial Traveler   Agencies that permit nonofficial travelers, such as news media
Reimbursements Have Not     representatives, on their nonreimbursable 89th Airlift Wing missions are to
                            bill such travelers and collect the reimbursements. The Air Mobility
Been Properly Accounted
                            Command reported that it had received about $7.9 million in both agency
for                         and nonofficial passenger reimbursements in fiscal years 1993-98.

                            While DOD has collected reimbursements for nonofficial travel, DFAS
                            officials have sometimes credited the wrong fiscal year accounts. Agencies
                            that have collected nonofficial traveler reimbursements sent the funds to
                            DFAS’ Omaha Operating Location for crediting to the proper Air Mobility
                            Command fiscal year O&M account. However, because the agencies did not
                            notify DFAS of the mission dates, DFAS had to rely on the agencies to
                            specify the fiscal year account into which to credit the funds. For example,
                            OSD (Public Affairs) collected and remitted reimbursements but was
                            unaware that the accounting code the office must report to DFAS for
                            proper funds handling also instructs DFAS which fiscal year account the
                            funds should be credited to. OSD (Public Affairs) incorrectly instructed
                            DFAS to credit the fiscal year 1997 account with reimbursements for fiscal
                            years 1998 and 1999 nonofficial travel. As a result, DFAS credited at least
                            $106,000 in reimbursements for fiscal years 1998 and 1999 nonofficial travel
                            to the fiscal year 1997 account.

                            The Economy Act requires reimbursements to be credited to the agency
                            appropriation or fund used to provide service to another agency. Since the
                            89th Airlift Wing’s flight operations are funded with an annual O&M
                            appropriation, reimbursements must be credited to the appropriate Air
                            Force O&M account for the fiscal year in which the travel took place. Thus,
                            the fiscal year 1998 reimbursements should be credited to the fiscal year
                            1998 account; fiscal year 1999 reimbursements should be credited to the
                            fiscal year 1999 account. Properly crediting these reimbursements to the
                            current fiscal year appropriation account allows the Air Mobility Command
                            to use those funds for a variety of O&M-based spending needs in the
                            current fiscal year. However, if DFAS inappropriately credits
                            reimbursements to a prior year account, the use of the funds is
                            unnecessarily restricted because they may then only be used toward
                            obligations incurred in that prior year.

                            We found other errors as well. For example, OSD (Public Affairs)
                            instructed DFAS to credit about $57,000 to the Air Mobility Command’s
                            O&M account for nonofficial travelers that accompanied the Secretary of
                            Defense on four trips in 1998. However, these trips were taken on aircraft
                            operated by the Air Combat Command and assigned to the 55th Wing, Offutt

                            Page 9                                        GAO/NSIAD-99-170 Military Aircraft

                           Air Force Base, Nebraska. Therefore, the funds should have been credited
                           to an Air Combat Command account, not an Air Mobility Command

                           No one independently verified that all reimbursements were made. For
                           example, Air Mobility Command officials told us they have not monitored
                           DFAS billing and reimbursement operations and were surprised when we
                           brought to their attention the improper crediting of some reimbursements.
                           Moreover, DFAS has not received passenger manifests from the 89th Airlift
                           Wing, thus missing an opportunity for independent verification that all
                           nonofficial traveler reimbursements due are actually collected.

Transactions Are Not       We could not verify the receipt and crediting of some nonofficial traveler
Readily Verifiable         reimbursements because DFAS’ record-keeping procedures do not permit
                           full verification of all transactions. DOD Directive 7000.14-R stipulates that
                           accounting methods must permit transactions to be traced for verification.
                           However, DFAS commingled numerous individual reimbursement checks
                           on a single cash collection voucher. While convenient, the practice
                           undermines effective management controls by preventing verification that
                           all transactions were properly completed. Due to the commingling of
                           individual reimbursement checks, we could not determine whether DFAS
                           properly processed all 89th Airlift Wing reimbursements from nonofficial

Billing Instructions Are   At the time of our review, the billing process through which DOD should
Inadequate                 have collected reimbursements from non-DOD agencies for 89th Airlift Wing
                           missions had stopped functioning. DOD had not issued adequate billing
                           instructions, but the process worked to some extent prior to 1997 anyway,
                           possibly because experienced officials were in place. By 1997, the agency
                           billing process had come to a halt, possibly due to a lack of adequate
                           documentation of the process and some significant, nearly simultaneous
                           personnel changes. Moreover, OSD (Public Affairs) similarly lacked
                           adequate instructions on how its staff was to handle the transactions and
                           instruct DFAS where to credit the funds, with the result that some funds
                           were incorrectly credited. We identified a similar lack of instructions in
                           OSD (Public Affairs) in 1992.

                           Page 10                                        GAO/NSIAD-99-170 Military Aircraft

Recommendation        We recommend that the Secretary of Defense document the Department’s
                      billing and reimbursement process with written instructions or other
                      guidance and ensure that all DOD components involved in the process
                      comply with DOD accounting and financial management requirements to
                      record transactions in a manner that permits verification of the proper
                      handling of the funds.

Agency Comments and   DOD and OMB provided written comments on a draft of this report (see
                      apps. I and II). DOD concurred with our recommendation and stated that it
Our Evaluation        is working to incorporate the reimbursement process into the proper
                      guidance. DOD also stated that DFAS was collecting overdue
                      reimbursements at the time of our report. OMB stated that the report
                      identifies some important weaknesses in the accounting and collection of
                      reimbursements for non-DOD use of 89th Airlift Wing aircraft. In addition,
                      DOD provided technical comments that we incorporated as appropriate.

Scope and             Because most of the missions flown by the 89th Airlift Wing are in support
                      of the executive branch, we focused our analysis on the changes made to
Methodology           executive branch guidance concerning the use of government-owned
                      aircraft, such as OMB Circular A-126 and other relevant DOD and White
                      House implementing guidance.

                      To determine whether changes to executive branch policies since 1992
                      addressed the intent of our recommendations, we met with OMB officials
                      and obtained the 1989 and 1992 versions of OMB Circular A-126, Improving
                      the Management and Use of Government Aircraft. We also met with
                      officials from OSD (Executive Secretary); OSD (Legislative Affairs); and
                      the Office of Special Air Missions, Vice Chief of Staff of the Air Force, in
                      Washington, D.C., and from the 89th Airlift Wing at Andrews Air Force Base,
                      Maryland. These officials also provided us with DOD or Air Force
                      directives, guidance, policy statements, mission request records, mission
                      approval memorandums, correspondence, and other documents. To
                      determine how the policies have changed since our April 1992 report, we
                      compared versions of the various guidance documents in force as of April
                      1992 with any amendments or other changes since that time and
                      characterized the substance of the changes.

                      To determine whether justifications for wing usage complied with
                      applicable policies, we interviewed the same officials to determine the

                      Page 11                                       GAO/NSIAD-99-170 Military Aircraft

procedures they followed to review 89th Airlift Wing mission requests. We
reviewed a sample of non-DOD reimbursable mission requests to
determine whether guidance and directives were adhered to in the review
and approval of these mission requests. We also met with officials from the
Office of the Secretary of State to determine the basis on which that agency
decided whether to use military or commercial aircraft and the process
they used to approve a request to DOD for transportation support.

To determine whether reimbursements for 89th Airlift Wing flights have
been made, we met with officials and obtained documents from
organizations that are responsible for key steps in the billing and
reimbursement process. First, we met with the Office of Special Air
Missions and the 89th Airlift Wing Comptroller. To determine how billing
and reimbursements were processed, we met with officials from DOD and
Department of State offices responsible for billing nonofficial passengers,
including OSD (Personal Security), OSD (Public Affairs), and the Office of
the Secretary of State. We also obtained billing records, documents
showing reimbursement checks received from parties billed, cash
collection vouchers, transmittal documents showing fund transfers to
DFAS, and other documents. We compared a sample of passenger
manifests from 89th Airlift Wing missions with bills or check receipts to
determine whether nonofficial passengers had been billed and
reimbursements had been made to DOD for the missions, as required by
OMB Circular A-126 and other guidance.

To determine whether DFAS or the Air Mobility Command had sent bills
and collected reimbursements for agency missions, we obtained 89th Airlift
Wing flight records and compared them with agency mission requests to
determine which missions were reimbursable. We also met with officials at
DFAS’ Omaha Operating Location in Nebraska to discuss the billing and
reimbursement process and obtained guidance on handling billings and
reimbursements. To determine whether bills had been sent and
reimbursements collected, we obtained billing records, cash collection
vouchers, copies of checks, deposit records, and other documents. Finally,
we met with officials from the Air Mobility Command in Illinois to
determine how they monitored the billing and reimbursement process and
verified that funds deposited by DFAS were credited to the proper Air
Mobility Command accounts. We also verified DFAS records as we deemed
necessary. We did not evaluate the data used to set reimbursement rates
that DOD charged non-DOD agencies traveling on reimbursable 89th Airlift
Wing missions.

Page 12                                       GAO/NSIAD-99-170 Military Aircraft

To provide the background information showing which agencies of the
government were the most frequent users of the 89th Airlift Wing, we
obtained flight records showing every 89th Airlift Wing mission between
January 1, 1993, and February 8, 1999. We counted as White House missions
all missions for which the flight records indicated that the White House was
the sponsoring agency. Thus, we counted as White House missions those
for which the President traveled or other departments’ or agencies’ officials
traveled at the President’s direction except State Department missions,
which we identified separately whether or not they were presidentially

We did not review the use of helicopters in the 89th Airlift Wing’s inventory.

We conducted our work from January to July 1999 in accordance with
generally accepted government auditing standards.

We will send copies of this report to interested congressional committees;
Mr. John Podesta, the White House Chief of Staff, Executive Office of the
President; the Honorable William S. Cohen, the Secretary of Defense; the
Honorable Louis Caldera, the Secretary of the Army; the Honorable
Richard Danzig, the Secretary of the Navy; the Honorable F. Whitten Peters,
the Secretary of the Air Force; the Honorable Madeleine K. Albright, the
Secretary of State; and the Honorable Jacob J. Lew, Director of the Office
of Management and Budget.

Please contact me at (202) 512-5140 if you or your staff have any questions
about this report. Other key contributors on this assignment are listed in
appendix III.

Sincerely yours,

Mark E. Gebicke
Director, National Security
 Preparedness Issues

Page 13                                        GAO/NSIAD-99-170 Military Aircraft

Letter                                                                                                1

Appendix I                                                                                           16
Comments From the
Department of Defense

Appendix II                                                                                          17
Comments From the
Office of Management
and Budget

Appendix III                                                                                         18
GAO Staff

Related Products                                                                                     20

Tables                  Table 1: The 89th Airlift Wing’s Inventory of Fixed-Wing Aircraft             2
                        Table 2: Usage of the 89th Airlift Wing by Agency                             3
                        Table 3: Actions Responding to Our 1992 Recommendations                       6


                        DFAS       Defense Finance and Accounting Service
                        DOD        Department of Defense
                        O&M        Operations and Maintenance
                        OMB        Office of Management and Budget
                        OSD        Office of the Secretary of Defense

                        Page 14                                       GAO/NSIAD-99-170 Military Aircraft
Page 15   GAO/NSIAD-99-170 Military Aircraft
Appendix I

Comments From the Department of Defense                        AppenIx

             Page 16          GAO/NSIAD-99-170 Military Aircraft
Appendix II

Comments From the Office of Management
and Budget                                                     AppeInx

              Page 17         GAO/NSIAD-99-170 Military Aircraft
Appendix III

GAO Staff Acknowledgments                                                                       AppIenIx

Acknowledgments   Carol R. Schuster, William M. Solis, Brian J. Lepore, Andrew D. Crawford,
                  and Arthur L. James, Jr., made key contributions to this report.

                  Page 18                                      GAO/NSIAD-99-170 Military Aircraft
Page 19   GAO/NSIAD-99-170 Military Aircraft
Related Products

Government Aircraft     Travel of Government Officials on Government Aircraft
                        (GAO/T-NSIAD-96-85, Dec. 29, 1995).

                        Government Aircraft: Observations on Travel by Senior Officials
                        (GAO/NSIAD-95-168BR, June 5, 1995).

                        Military Aircraft: Travel on 89th Military Airlift Wing and Travel by Selected
                        Officials (GAO/T-NSIAD-92-35, Apr. 30, 1992).

                        Military Aircraft: Policies on Government Officials’ Use of 89th Military
                        Airlift Wing Aircraft (GAO/NSIAD-92-133, Apr. 9, 1992).

                        Military Aircraft: Travel by Selected Executive Branch Officials
                        (GAO/AFMD-92-51, Apr. 7, 1992).

Department of Defense   Financial Management: Profile of Defense Finance and Accounting Service
                        Financial Managers (GAO/AIMD-98-133, May 28, 1998).
Financial Operations
                        Financial Management: An Overview of Finance and Accounting Activities
                        in DOD (GAO/NSIAD/AIMD-97-61, Feb. 19, 1997).

                        High Risk Series: Defense Financial Management (GAO/HR-97-3, Feb. 1,

                        DOD Infrastructure: DOD’s Planned Finance and Accounting Structure Is
                        Not Well Justified (GAO/NSIAD-95-127, Sept. 18, 1995).

(703258)    Leter       Page 20                                        GAO/NSIAD-99-170 Military Aircraft
Ordering Information

The first copy of each GAO report and testimony is free.
Additional copies are $2 each. Orders should be sent to the
following address, accompanied by a check or money order made
out to the Superintendent of Documents, when necessary, VISA and
MasterCard credit cards are accepted, also.

Orders for 100 or more copies to be mailed to a single address are
discounted 25 percent.

Orders by mail:

U.S. General Accounting Office
P.O. Box 37050
Washington, DC 20013

or visit:

Room 1100
700 4th St. NW (corner of 4th and G Sts. NW)
U.S. General Accounting Office
Washington, DC

Orders may also be placed by calling (202) 512-6000
or by using fax number (202) 512-6061, or TDD (202) 512-2537.

Each day, GAO issues a list of newly available reports and
testimony. To receive facsimile copies of the daily list or any list
from the past 30 days, please call (202) 512-6000 using a touchtone
phone. A recorded menu will provide information on how to obtain
these lists.

For information on how to access GAO reports on the INTERNET,
send an e-mail message with “info” in the body to:


or visit GAO’s World Wide Web Home Page at:

United States                       Bulk Rate
General Accounting Office      Postage & Fees Paid
Washington, D.C. 20548-0001           GAO
                                 Permit No. GI00
Official Business
Penalty for Private Use $300

Address Correction Requested