oversight

Civilian Marksmanship Program: Corporation Needs to Fully Comply With the Law on Sales of Firearms

Published by the Government Accountability Office on 1999-01-12.

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

                  United States General Accounting Office

GAO               Report to Congressional Requesters




January 1999
                  CIVILIAN
                  MARKSMANSHIP
                  PROGRAM
                  Corporation Needs to
                  Fully Comply With the
                  Law on Sales of Firearms




GAO/NSIAD-99-41
                   United States
GAO                General Accounting Office
                   Washington, D.C. 20548

                   National Security and
                   International Affairs Division

                   B-281768

                   January 12, 1999

                   The Honorable Frank R. Lautenberg
                   United States Senate

                   The Honorable Carolyn B. Maloney
                   House of Representatives

                   This report responds to your request regarding the Civilian Marksmanship
                   Program (CMP), which until 1996 was administered by the Department of
                   the Army. As required by the Fiscal Year 1996 National Defense
                   Authorization Act, the program was to be transitioned from the Army to
                   the private, nonprofit Corporation for the Promotion of Rifle Practice and
                   Firearms Safety, which was established by this law.1 The program is
                   designed to promote and monitor marksmanship training through a system
                   of affiliated clubs and to sponsor marksmanship competitions.2 As part of
                   these activities, the Corporation sells certain surplus military firearms to
                   the affiliated clubs and their members. In response to your request, we
                   determined (1) whether the program’s conversion to a private corporation
                   and the Corporation’s subsequent firearms sales were conducted in
                   accordance with the 1996 act, (2) the types and value of federal support
                   provided to the Corporation, and (3) the types and number of firearms the
                   Army transferred to the Corporation and was storing for potential transfer.
                   In August 1998, we provided information you requested regarding the
                   Army’s investigation of alleged criminal activity within the CMP when it was
                   an Army program.3


                   The Army and the Corporation for the Promotion of Rifle Practice and
Results in Brief   Firearms Safety completed the transition of the CMP to the Corporation on
                   September 30, 1996, in accordance with the 1996 act. The 1996 act
                   authorized the Corporation to sell firearms but did not specify any
                   external oversight to ensure that the Corporation’s firearms sales
                   complied with the act. The Corporation has not routinely ensured that it
                   complied with the requirements of the 1996 act in its firearms sales to
                   individuals. On the basis of a random sample of the 6,400 M1 Garand rifle


                   1
                    Corporation for the Promotion of Rifle Practice and Firearms Safety Act, title XVI of P.L. 104-106
                   (Feb. 10, 1996) (“the act”).
                   2
                    Under section 1612(b) of P.L. 104-106, the Corporation is directed to give priority under the CMP to
                   activities that benefit firearms safety, training, and competition for youth and that reach as many youth
                   participants as possible.
                   3
                    Army Investigation of Civilian Marksmanship Program (GAO/OSI-98-14R, Aug. 18, 1998).



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sales between July 1997 and August 1998, we estimate that the
Corporation sold between 1,200 and 2,200 M1 Garands without adhering to
its own procedures that were designed to ensure that the purchasers were
not convicted of felonies, were U.S. citizens, and were members of a
Corporation-affiliated club.

The Army and other defense agencies had provided more than $19 million
in support to the Corporation as of September 30, 1998. More than
$17.5 million of that support was authorized by the 1996 act to be provided
without reimbursement. For support provided on a reimbursable basis,
Corporation officials told us the Corporation reimbursed the Army and
other defense organizations more than $1 million for such things as the
inspection, repair, and shipping of firearms. However, additional support,
including obtaining background investigations of prospective gun buyers,
was provided to the Corporation at a cost of more than $440,000 but was
not specifically referred to in the act and was not reimbursed by the
Corporation. Also, the Secretary of the Army has not prescribed
regulations relating to the logistical support to be provided to the
Corporation and reimbursement for that support, even though the 1996 act
required the Secretary to do so. Army headquarters officials told us
existing regulations governing support to outside organizations were
considered sufficient to cover the support to the Corporation.
Notwithstanding that view, several Army officials told us they were
uncertain as to what support they should be providing and how to arrange
for reimbursement from the Corporation for expenses incurred by the
Army.

As of September 30, 1998, the Army had transferred more than 56,000
firearms to the Corporation, including M1 Garands, M1 Carbines, M14s,
.22 caliber rifles, and pistols. Firearms transferred but not sold are stored
by the Corporation. Under section 1615 of the act, the Secretary of the
Army was required to transfer to the Corporation all firearms under the
control of the Army’s CMP Director on February 9, 1996, including M1
Garand and .22 caliber rifles stored at the Anniston Army Depot in
Anniston, Alabama. These firearms were to be transferred as and when
necessary to enable the Corporation to issue, loan, or sell them in
accordance with the act. At transition, the Army transferred to the
Corporation all of the required firearms except those at Anniston. As of
September 30, 1998, the Army was storing more than 230,000 M1 Garands,
over 35,000 .22 caliber rifles, and more than 4,000 other firearms at
Anniston for potential transfer to the Corporation. At that time, the Army
and the Corporation were negotiating a new memorandum of



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             understanding that would make any of these firearms that were surplus to
             Army requirements available for transfer to the Corporation. Army
             officials told us that some of these firearms were not at Anniston under
             CMP control on February 9, 1996. Should the Army decide to transfer
             firearms that were not under CMP control on February 9, 1996, legislative
             authority other than section 1615 of the act would be needed.


             The CMP originated in 1903 with the establishment of the National Board
Background   for the Promotion of Rifle Practice, which advised the Secretary of War.
             The general purpose of the program was to encourage individuals to
             develop marksmanship skills to prepare them in the event that they were
             called upon to serve during wartime. Congress directed the Department of
             Defense (DOD) to assume management of the CMP, including authorizing
             the detail of a Marine or Army officer as director of civilian marksmanship
             and the detail of Army members to provide weapons instruction to
             civilians and rifle clubs. The Secretary of the Army was required to provide
             for such things as (1) the operation and maintenance of rifle ranges,
             (2) the promotion of firearms practice and the conduct of matches and
             competitions, and (3) the sale of firearms to affiliated gun clubs that
             provide firearms training and to U.S. citizens over 18 years of age who are
             members of those clubs.

             In response to a request from the then House Armed Services Committee,
             we issued a 1990 report on the CMP’s mission, purpose, usefulness, and
             cost.4 We concluded that the Army’s CMP was of limited value because,
             among other things, the CMP’s objectives and goals were not linked to
             Army mobilization and training plans. We also reported that the Army’s
             proposed CMP budget for fiscal years 1990-94 was about $5 million a year.
             The Fiscal Year 1996 National Defense Authorization Act required the CMP
             to be transitioned from a DOD appropriated fund activity to a nonprofit
             corporation that was established by this act.

             The act required the Secretary of the Army to transfer to the Corporation
             all firearms and ammunition under the control of the Army’s CMP Director
             on February 9, 1996, and to transfer funds derived from sales programs
             and various other sources. In addition, the 1996 act authorized the
             Corporation, as the Army previously had been authorized, to sell firearms
             to U.S. citizens. Under the act, the Corporation was authorized to sell
             firearms to individuals who (1) have not been convicted of a felony, (2) are

             4
              Military Preparedness: Army’s Civilian Marksmanship Program Is of Limited Value
             (GAO/NSIAD-90-171, May 23, 1990).



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                     U.S. citizens over 18 years of age, and (3) are members of
                     Corporation-affiliated gun clubs. Also, the Corporation was prohibited
                     from selling firearms to individuals who had been convicted of firearms
                     violations under 18 U.S.C. 922; these violations include knowingly shipping
                     or transporting stolen firearms or ammunition in interstate or foreign
                     commerce. The 1996 act also provided that the Corporation’s sales are
                     subject to applicable federal, state, and local laws. These laws include,
                     among others, provisions of the Gun Control Act of 1968 that prohibit
                     certain categories of persons from purchasing firearms.5

                     To facilitate the transition of the CMP from the Army to the Corporation,
                     the 1996 act authorized and directed the Secretary of the Army to take a
                     number of actions. For example, the act authorized the Secretary to
                     provide specific support to the program, such as the storage of firearms,
                     without reimbursement by the Corporation. The act also authorized the
                     Secretary to provide other logistical support to the CMP, such as support
                     for competitions and other activities, with reimbursement from the
                     Corporation for incremental direct costs incurred by the Army to provide
                     such support. Also, the act required the Secretary of the Army to prescribe
                     implementing regulations for carrying out this support.


                     The transition of the CMP from the Army to the Corporation was completed
Program Transition   on September 30, 1996, in accordance with the Corporation for the
Met Statutory        Promotion of Rifle Practice and Firearms Safety Act. The Secretary of the
Requirements         Army transferred (1) all property under the control of the Director of
                     Civilian Marksmanship, the Civilian Marksmanship Support Detachment,
                     and the National Match Fund, including office equipment, targets and
                     frames, vehicles, supplies, and appliances; (2) control of the leased
                     property that had been occupied by the Civilian Marksmanship Support
                     Detachment in Port Clinton, Ohio; and (3) all funds available from sales
                     programs and fees to the National Board for the Promotion of Rifle
                     Practice and all funds in a nonappropriated fund account known as the
                     National Match Fund. These transfers were completed by September 30,
                     1996. Also, the Secretary of the Army, as required, appointed on July 12,
                     1996, the Corporation’s initial Board of Directors. As required, the
                     Corporation’s Board of Directors appointed in July 1996 a Director of
                     Civilian Marksmanship to be responsible for the daily operations of the
                     CMP. The CMP began operations under the Corporation on October 1, 1996.


                     5
                      These include any person who (1) has been convicted of a crime punishable by imprisonment for
                     more than a year, (2) is a fugitive from justice, (3) is an unlawful user of any controlled substance,
                     (4) is an adjudged mental defective, (5) is subject to certain restraining orders related to domestic
                     violence, or (6) has been convicted of a misdemeanor crime of domestic violence (18 U.S.C. 922(g)).



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                                          The Corporation has not routinely ensured that its sales of firearms to
Corporation Policies                      individuals complied with the requirements of the 1996 act. The
Inadequate, and                           Corporation could make sales under the act to purchasers that (1) had not
Procedures to Ensure                      been convicted of a felony or otherwise ineligible to purchase a firearm,
                                          (2) were U.S. citizens over 18 years of age, and (3) were members of gun
Firearms Sales                            clubs affiliated with the Corporation. The act also required the
Comply With the Act                       Corporation to establish procedures to obtain a criminal records check for
                                          purchasers with appropriate federal and state authorities. Corporation
Not Followed                              officials told us that they had policies and procedures in place to ensure
                                          that the requirements of the 1996 act for firearms sales to individuals were
                                          met. We reviewed these policies and procedures and found that in some
                                          cases the Corporation’s policies were not adequate to ensure that the
                                          purchasers met the requirements of the act. In other cases, the
                                          Corporation did not adhere to its own procedures that could have ensured
                                          that the purchasers met the requirements. As a result, the Corporation sold
                                          firearms to individuals without ensuring that purchasers were not
                                          convicted of a felony or otherwise ineligible to purchase a firearm, were
                                          U.S. citizens, and were members of Corporation-affiliated clubs.


Corporation Firearms Sold                 According to Corporation officials, the Corporation sold 22,584 firearms in
and on Loan                               the 2-year period between October 1, 1996, and September 30, 1998. Of
                                          these firearms, the Corporation sold 16,637 (74 percent) to individuals and
                                          5,947 (26 percent) to some of its 1,033 affiliated clubs. Over 72 percent of
                                          all firearms sold were M1 Garands, a World War II era semiautomatic rifle,
                                          for which the Corporation as of September 1998 charged from $400 to
                                          $750 each, depending on the rifle’s condition. Figure 1 depicts the
                                          .30 caliber M1 Garand.


Figure 1: M1 Garand Semiautomatic Rifle




                                          Source: Small Arms of the World, 11th ed. (Harrisburg, Pa.: Stackpole Books, 1997), p. 532.




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                                       Regarding firearms on loan, Corporation officials said that 905 M14s
                                       remained on loan to certain affiliated clubs as of September 30, 1998.6
                                       These officials told us that the Army had lent the M14s to those clubs
                                       when it operated the program but that the Corporation is not lending any
                                       additional firearms because of liability issues. Table 1 depicts the number
                                       and types of firearms sold by the Corporation.

Table 1: Firearms Sold by the
Corporation During Fiscal Years 1997   Firearm                                        Sold to individuals         Sold to clubs           Total
and 1998                               M1 Garand        a
                                                                                                     14,947                 1,392        16,339
                                       M1Da                                                            1,379                     0        1,379
                                                         a
                                       M1 Carbine                                                           0                 597              597
                                       M1903A3a                                                           39                     0             39
                                       .22 caliber                                                       272                3,278         3,550
                                       Air rifle                                                            0                 680              680
                                       Total                                                         16,637                 5,947        22,584
                                       a
                                           .30 caliber rifle.



                                       We did not review the sales of firearms to Corporation-affiliated clubs.
                                       Many of the clubs had been established when the Army ran the CMP and
                                       some of the data needed to determine whether procedures had been
                                       followed either were not maintained by the Army or were indecipherable
                                       in the microfiche files the Army provided to the Corporation.


Corporation’s Application              The Corporation’s application policies were insufficient to ensure that it
Policies Insufficient to               did not sell firearms to persons who were convicted of a felony or
Ensure Firearms Were Sold              otherwise ineligible to purchase a firearm or who were not U.S. citizens.
                                       For example, the Corporation’s policy required a background investigation
Only to Eligible Purchasers            before a firearm purchase was approved. However, Corporation policy
                                       also allowed individual applicants to provide various documents in lieu of
                                       a background investigation. Of the 16,637 firearms sales to individuals
                                       during fiscal years 1997 and 1998, Corporation officials estimated that they
                                       requested background investigations for about 8,000 applicants.

                                       The Corporation obtained background investigations from the Defense
                                       Security Service (DSS). DSS investigations included a name search and
                                       fingerprint check by the Federal Bureau of Investigation for felonies and
                                       other conditions that would render an individual ineligible to purchase a

                                       6
                                        These rifles remain on loan only to clubs that are Corporation-affiliated state associations (one in
                                       each state) for the use of the state rifle team.



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    firearm. As is customary when DSS manages these investigations, DSS made
    no assessment regarding an individual’s eligibility to purchase a firearm
    but instead provided the raw results of the investigations to Corporation
    employees to enable them to make this determination. However, the
    Corporation had no written guidelines for its employees to use to identify
    items in the DSS investigation that would disqualify individuals from
    purchasing firearms.

    In lieu of a DSS investigation, Corporation policy allowed applicants to
    provide one of the following documents:

•   a dated letter from the applicant’s security manager verifying that the
    applicant is a current U.S. servicemember, government employee, or
    contractor with a current U.S.-issued security clearance;
•   a notarized or certified true copy of an applicant’s current military security
    clearance if the applicant is active duty military;
•   a letter from the chief of police or sheriff attesting to the applicant’s good
    character if the applicant is a sworn law enforcement officer; or
•   a notarized copy of a current concealed weapons permit.

    The first two of these documents are not sufficient to determine whether
    individuals were convicted of a felony or were otherwise ineligible to
    purchase a firearm. Possession of a current U.S.-issued security clearance
    does not mean that criminal records checks with appropriate federal and
    state law enforcement agencies have been conducted recently or that
    individuals were not convicted of a felony or otherwise ineligible to
    purchase a firearm. DOD personnel security officials told us that some
    persons with current security clearances may have had their last criminal
    records checks as many as 10, 15, or even 20 years ago. Also, these
    officials told us that organizations issuing security clearances have the
    discretion to consider mitigating factors to individuals’ past behavior and
    thus sometimes issue clearances to individuals who have, for example,
    felony convictions or other criminal behavior on their records.

    The Corporation’s policies also were insufficient to ensure that purchasers
    were U.S. citizens. The Corporation required applicants to certify that they
    were U.S. citizens and accepted as evidence of citizenship a copy of
    applicants’ birth certificates, voter registration cards, proof of
    naturalization, passports, or certificates of release/discharge from active
    duty (DD 214). While most of these documents provide sufficient evidence
    of citizenship, a certificate of release/discharge from active duty does not.
    Military personnel may be either U.S. citizens or permanent residents, and



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                                because the DD 214 does not contain information on individuals’
                                citizenship, it does not ensure that the citizenship requirement has been
                                met.


Corporation Did Not             The Corporation did not always follow its own procedural requirements
Follow Its Own Procedural       and therefore could not ensure that individuals met the statutory
Requirements                    requirements for the purchase of firearms. We randomly examined
                                samples of the Corporation’s sales records for three types of firearms sold
                                to individuals: M1 Garand, M1D, and .22 caliber rifles. These firearms
                                accounted for 99 percent of the Corporation’s firearms sales to individuals.
                                Based on all three random samples, we found the following:

                            •   The Corporation sold firearms without obtaining a DSS background
                                investigation for some purchasers who submitted no substitute documents
                                as evidence that a qualifying background investigation had been
                                conducted. Additionally, investigations were not obtained for some
                                individuals because they had previously purchased firearms through the
                                CMP. The Corporation neither verified that an investigation had been
                                conducted for the prior purchase, some as many as 5 years before, nor
                                conducted a search to account for any prohibited activity in the
                                intervening years. The Corporation also accepted state firearms licenses
                                other than concealed weapons permits in lieu of a background
                                investigation without evidence that an investigation was conducted as a
                                part of issuing the licenses.
                            •   The Corporation sold firearms to individuals who provided no proof of
                                citizenship or who provided drivers’ licenses as proof of citizenship.
                            •   The Corporation sold firearms to persons who did not submit any proof of
                                membership in a Corporation-affiliated gun club or submitted an expired
                                membership card or a membership card with no name.

                                Table 2 shows how often the applicants in our three randomly selected
                                samples did not provide an item the Corporation’s policy allowed as proof
                                of meeting the requirements for a firearm purchase. For each type of
                                firearm sale we sampled, documentation was insufficient to ensure the
                                requirements were met. For example, 37 (27 percent) of the 136 M1
                                Garand sales we reviewed were insufficiently documented. Projecting our
                                sample results to the approximately 6,400 M1 Garand sales over the
                                14-month period from which we sampled, we estimate that the
                                Corporation sold between 1,200 and 2,200 M1 Garands to individuals
                                without adhering to its procedures designed to ensure that purchasers met
                                the requirements of the 1996 act. We also randomly sampled M1D and



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                                              .22 caliber rifle sales. Relative to the overall rate for the M1 Garand sales,
                                              proportionately fewer M1D and .22 caliber rifle sales met the
                                              Corporation’s requirements for ensuring compliance with the act. We
                                              could not project the results of our samples for M1D and .22 caliber rifle
                                              sales to a universe of those sales because of our small sample sizes.


Table 2: Purchases the Corporation Approved Without Following Its Procedures to Ensure Compliance With the 1996 Act
                                                                M1 Garand               M1D               .22 Caliber
                                                            (Sample size 136)     (Sample size 29)     (Sample size 38)
Requirement not assureda                                           Number       Percent     Number    Percent    Number     Percent
U.S. citizenship                                                           6           4         10        34         13         34
Club membership                                                          13           10         8         28          8         21
No felony conviction or other ineligibility                              26           19         11        38         22         58
Purchases for which Corporation failed to ensure
compliance with at least one requirement                                 37           27         12        41         23         61
                                              a
                                              Some purchases did not meet several requirements



                                              Regarding resales, Corporation officials told us that each individual
                                              purchaser of a firearm is required to sign a statement that the firearm is for
                                              his or her personal use. These officials told us that, practically speaking,
                                              however, they could not control the resale of firearms. According to Army
                                              and Corporation officials, the Army’s CMP program allowed an individual
                                              only one lifetime purchase of each type of firearm. The Army restriction
                                              may have limited the number of firearms available for resale. In contrast,
                                              the Corporation has adopted a policy that allows an individual to annually
                                              purchase two M1 Garands and one of each other type of firearm sold to
                                              individuals by the Corporation.


                                              The 1996 act authorized the Corporation to sell firearms but did not
No External Oversight                         specify any external oversight to ensure compliance of these sales with the
to Ensure Corporation                         1996 act. Thus, the Corporation is not subject to the licensing and
Firearms Sales                                oversight requirements of firearms dealers who are regulated by the
                                              Bureau of Alcohol, Tobacco and Firearms (ATF) under the Gun Control Act
Comply With the 1996                          of 1968. Specifically, these dealers must file an application with the ATF,
Act                                           which reviews the applications and inspects applicants to determine their
                                              qualifications for licenses. License holders are then subject to periodic
                                              compliance inspections by the ATF. Although not regulated by the ATF, the
                                              Corporation is subject to Internal Revenue Service requirements
                                              applicable to tax-exempt organizations, including the reporting of its gross




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                                       income, receipts, and disbursements. Corporation officials told us that to
                                       comply with this requirement, the Corporation obtains an independent
                                       financial audit each year.

                                       While the act required the Army to provide firearms to the Corporation, it
                                       did not authorize the Army to oversee the Corporation’s firearms sales.
                                       However, a 1996 memorandum of understanding between the Army and
                                       the Corporation requires the Corporation to certify in writing that sales
                                       have met statutory requirements before the Army ships firearms to a
                                       purchaser. According to Army and Corporation officials, however, the
                                       Army has never denied a request from the Corporation to ship a firearm,
                                       even though the Corporation has not provided the certifications.
                                       Corporation officials said that it was logistically impossible to certify every
                                       firearm sale in writing. Army officials said that the Corporation is solely
                                       responsible for ensuring that firearms recipients have met the statutory
                                       requirements.


                                       DOD  provided more than $19 million in support to the Corporation during
DOD Provides                           the transition and the 2 years of the Corporation’s existence. More than
Continued Support to                   $17.5 million of that support was authorized by the 1996 act to be provided
the CMP                                without reimbursement. This included about $7.7 million in assets
                                       provided to the Corporation by the Army during the transition of the CMP
                                       as required by the 1996 act. These assets included funds, firearms,
                                       ammunition, trophies, equipment, and vehicles (see table 3).

Table 3: Property Transferred to the
Corporation at Transition of the CMP   Dollars in thousands
                                       Type of support                                                                          Value
                                       Funds                                                                                    $3,800a
                                       Firearms                                                                                  1,094b,c
                                       Ammunition                                                                                2,172c
                                       Trophies, equipment, and vehicles                                                          614c
                                       Total                                                                                    $7,680
                                       a
                                       As reported in Army transition documents.
                                       b
                                           This figure represents the value of 6,512 firearms transferred to the Corporation.
                                       c
                                       As reported by the Army Audit Agency on September 27, 1996.



                                       Since the transition, DOD has provided unreimbursed support worth more
                                       than $10.3 million to the Corporation through September 30, 1998. Most of




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the support provided (more than $9.9 million) was specifically authorized
by the 1996 act to be provided on a nonreimbursable basis. This support
included firearms, ammunition, and repair parts. According to Army
officials, providing these items to the Corporation actually resulted in a
cost savings because the alternatives were either to incur costs to
continue storing the items or to incur costs to demilitarize them. We were
unable to determine the total cost of unreimbursed DOD support because
DOD officials did not know the value of some items of support, such as
firearms storage. In addition, according to Corporation officials, as of
September 30, 1998, DOD had provided more than $1 million in support for
which it was reimbursed. This support included the inspection, repair, and
shipping of firearms.

The 1996 act does not specifically refer to other DOD support that is being
provided without reimbursement. For example, DSS has provided
background investigations for the Corporation since October 1, 1996.
Based on the Corporation’s estimate that it had requested 8,000
investigations in fiscal years 1997 and 1998, DSS officials estimated that the
value of the investigations was $440,000. Additionally, since October 1997,
the Army has allowed the Corporation to use a building at the Anniston
Army Depot. The Corporation uses this building for office space and for
workspace to prepare some of the firearms for shipment to purchasers.
Army officials told us that although the Corporation has paid for the direct
incremental costs of utilities, police services, and refuse collection and
disposal, the building itself (a 13,551 square-foot warehouse) has been
provided to the Corporation rent free. Table 4 shows the value of
unreimbursed direct support provided to the Corporation since October 1,
1996.




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Table 4: Value of Unreimbursed DOD
Support Provided to the Corporation      Dollars in thousands
(Oct. 1, 1996, Through Sept. 30, 1998)   Type of support                                                                               Value
                                         Specifically authorized without reimbursement by the 1996 act
                                         Firearms                                                                                     $5,702a,b
                                         Ammunition                                                                                    3,833b
                                         Repair parts                                                                                    211b,c
                                         Surplus material and equipment                                                                       37b
                                         Support for national matches (Army Reserve personnel)                                           124
                                         Storage of firearms                                                                      Not knownd
                                         Subtotal                                                                                      9,907
                                         Not specifically referred to by the 1996 act
                                         Background checks                                                                               440
                                         Storage of ammunition and other supplies                                                 Not knownd
                                         Building at Anniston Army Depot for Corporation use                                      Not knownd
                                         Subtotal                                                                                        440
                                         Total                                                                                      $10,347
                                         a
                                         This represents the value of 49,906 firearms transferred after transition.
                                         b
                                             Based on Army Master Data File values.
                                         c
                                          Does not include the value of about 500 telescopes and cases. Army officials told us they did not
                                         have records on the value of these items.
                                         d
                                             Army officials told us they did not know the value of these items.



                                         The Secretary of the Army did not issue regulations relating to the
                                         logistical support to be provided to the Corporation and reimbursement
                                         for that support as required by the act. The Corporation has separate
                                         written agreements with several Army and other DOD organizations, such
                                         as Anniston Army Depot and the Defense Logistics Agency’s Defense
                                         Reutilization Marketing Service, that provide the Corporation support.
                                         However, we found inconsistencies in and confusion among officials
                                         responsible for providing such support. Some Army officials responsible
                                         for providing support told us they were unsure of what support they
                                         should be providing to the Corporation and how to arrange for
                                         reimbursement of expenses. For example, the Corporation pays
                                         administrative expenses for Army personnel involved with the transfer of
                                         firearms from the Army to the Corporation but is not charged
                                         administrative expenses for Army personnel involved with the transfer of
                                         ammunition. According to Army headquarters officials, new regulations
                                         for support to the CMP were not prescribed because they believed existing




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                                       regulations pertaining to the support of outside organizations were
                                       sufficient to cover support to the Corporation.7


                                       As of September 30, 1998, the Army transferred more than 56,000 firearms
Army Transferred                       to the Corporation. Of this number, the Army transferred about 6,500
Firearms to the                        firearms at the time of transition, including 401 M16s that the Corporation
Corporation and                        returned and plans to borrow as needed. Over the 2-year period since the
                                       transition, almost 50,000 firearms were transferred to the Corporation. All
Holds More for                         totaled, more than a dozen different types of firearms have been
Potential Future                       transferred, including M1 Garands, M1 Carbines, M14s, .22 caliber rifles,
                                       and pistols. As of September 30, 1998, the Army was storing about 270,000
Transfer                               additional M1 Garands, .22 caliber rifles, M1 Carbines, and other firearms
                                       for potential transfer.

                                       Table 5 shows the types and numbers of firearms transferred to the
                                       Corporation as of September 30, 1998.

Table 5: Types and Numbers of
Firearms Transferred to the                                                           Transferred to the Corporation
Corporation (Through Sept. 30, 1998)   Firearms                                   At transition            FY 1996-98                  Total
                                       .30 caliber rifle
                                            M1 Garand                                     1,216                  28,288               29,504
                                            M1C                                                0                      74                 74
                                            M1D                                                0                  2,385                2,385
                                            M1 National Match                                 72                       0                 72
                                            M1 Carbine                                       200                  1,126                1,326
                                            M1A1                                               9                       0                  9
                                            M14                                           1,314                        0               1,314
                                            M16                                              401                       0                401a
                                            M1903A3                                            4                    622                 626
                                            M1903A4                                            0                    411                 411
                                       .22 caliber rifle                                  2,614                  17,000               19,614
                                       7.62mm M700                                             1                       0                  1
                                       Pellet                                                  1                       0                  1
                                       Shotgun                                                 4                       0                  4
                                       Pistol                                                676                       0                676
                                       Total                                              6,512                  49,906               56,418
                                       a
                                           The Corporation returned the M16s to the Army and plans to borrow them as needed.



                                       7
                                        Notwithstanding our request, the Army did not identify these regulations during our review.



                                       Page 13                                         GAO/NSIAD-99-41 Civilian Markmanship Program
B-281768




The majority of the 6,512 firearms transferred at transition (4,581) were on
loan to CMP-affiliated clubs, while the remainder (1,931) were under the
control of the Civilian Marksmanship Support Detachment in Ohio. Army
officials told us that all of the firearms transferred after the transition were
stored at Anniston Army Depot and were deemed excess by the Army. The
Army transferred firearms either directly to the Corporation or to
recipients designated by the Corporation.

As of September 30, 1998, the Army had transferred 56,418 firearms to the
Corporation, including M1 Garands, M1 Carbines, M14s, .22 caliber rifles,
and pistols. Under section 1615 of the act, the Secretary of the Army was
required to transfer to the Corporation those firearms under the control of
the Army’s CMP Director on February 9, 1996, including all M1 Garand and
.22 caliber rifles stored at Anniston. These firearms were to be transferred
as and when necessary to enable the Corporation to issue, loan, or sell
them in accordance with the act. At transition, the Army transferred to the
Corporation all of the required firearms except those at Anniston. On
September 30, 1996, the Army and the Corporation signed a memorandum
of understanding in which the parties agreed that approximately 167,000
M1 Garands and 17,000 .22 caliber rifles were at Anniston under CMP
control on February 9, 1996.

As of September 30, 1998, the Army was storing more than 230,000
M1 Garands, over 35,000 .22 caliber rifles, and over 4,000 other firearms at
Anniston for potential transfer to the Corporation. At that time, the Army
and the Corporation were negotiating a new memorandum of
understanding that could make these firearms available to the
Corporation. However, Army officials told us that some of these firearms
were not at Anniston under CMP control on February 9, 1996. Should the
Army decide to transfer firearms from Anniston that were not under CMP
control on February 9, 1996, legislative authority other than section 1615
of the act will be needed.

Table 6 shows the types, numbers, and values of firearms stored at
Anniston Army Depot for potential transfer to the Corporation as of
September 30, 1998. Corporation officials said that the Army is their only
source of firearms.




Page 14                              GAO/NSIAD-99-41 Civilian Markmanship Program
                                         B-281768




Table 6: Firearms Stored for Potential
Transfer to the Corporation (as of       Firearm                                               Quantity                Valuea
Sept. 30, 1998)                          M1 Garand                                              230,590           $21,744,637
                                         M1C                                                          1                   220
                                         M1D                                                         29                 7,975
                                         M1 Carbine                                               3,052               234,699
                                         M1903A3                                                  1,016               108,712
                                         .22 caliber rifle                                       35,056             8,366,176
                                         Total                                                  269,744           $30,462,419
                                         a
                                         Based on Army Master Data File values.




                                         When Congress authorized the transfer of the CMP to a private, nonprofit
Conclusions                              corporation established by the act, it established specific requirements for
                                         the Corporation’s sale of firearms, for continued Army support of the
                                         program, and for the number of firearms to be transferred to the
                                         Corporation. To ensure that these requirements are met, oversight of
                                         Corporation sales of firearms and more specific guidance describing the
                                         logistical support to be provided are needed.


                                         We recommend that the Secretary of the Army issue regulations, as
Recommendation                           required by the 1996 act, addressing the logistical support to be provided
                                         to the Corporation and the policies for obtaining reimbursement from the
                                         Corporation for such support.


                                         When Congress established the Corporation as a private nonprofit
Matter for                               organization, it did not specify any external oversight to ensure that the
Consideration                            Corporation fully comply with the Corporation for the Promotion of Rifle
                                         Practice and Firearms Safety Act of 1996 in its sales of firearms. However,
                                         because the federal government established the Corporation and
                                         continues to provide firearms and other support, the federal government
                                         has an interest in ensuring that Corporation assets are being appropriately
                                         safeguarded. Therefore, Congress may wish to consider amending the act
                                         to require that the Corporation’s annual financial audit include an
                                         assessment of, and report on, its compliance with the 1996 act. Such an
                                         assessment should include an examination of the Corporation’s relevant
                                         internal controls. In addition, Congress may wish to require that the
                                         auditor’s report be provided to Congress.




                                         Page 15                                  GAO/NSIAD-99-41 Civilian Markmanship Program
                   B-281768




                   In written comments on a draft of this report, DOD concurred with our
DOD Comments and   recommendation in principle. DOD stated that existing regulations
Our Evaluation     prescribe guidance to address the logistical support provided by the Army
                   and the policies for obtaining reimbursement for such support. DOD further
                   stated that these regulations were being reviewed for appropriateness and
                   would be provided to the Corporation, along with the memorandum of
                   understanding, in response to the legislative requirement for regulations.

                   DOD  stated that existing regulations prescribe guidance to address
                   logistical support provided by the Army. However, DOD did not assert that
                   these regulations were appropriate to address the unique type of logistical
                   support that the Army provides to the Corporation. Instead, DOD stated
                   that they were currently reviewing these regulations for appropriateness.
                   As noted in our draft report, notwithstanding our request, DOD did not
                   identify these regulations until after it received our draft report. Therefore,
                   we were unable to determine their appropriateness. Our review found that
                   some Army personnel responsible for providing logistical support to the
                   Corporation were unsure of what support they should be providing and
                   how to arrange for reimbursement from the Corporation for such support.
                   Additionally, we found inconsistent arrangements for providing support
                   and reimbursement.

                   Our continuing concern is that Army personnel involved with providing
                   support to the Corporation have at their disposal adequate guidance for
                   their dealings with the Corporation. Therefore, we maintain that the Army
                   needs to issue regulations, as required by the 1996 act, addressing the
                   specific type of logistical support to be provided to the Corporation and
                   the policies for obtaining reimbursement from the Corporation for such
                   support. If, during the Army’s review of existing regulations, it finds that
                   parts of these regulations prove appropriate, the Army should make its
                   personnel aware of the specific parts that apply to the Corporation. If
                   existing regulations fall short of fully addressing the logistical support to
                   be provided to the Corporation, we believe the Army should issue
                   regulations to ensure full conformance with the 1996 act.

                   DOD’scomments are presented in their entirety in appendix I. DOD also
                   provided technical comments, which we have incorporated as appropriate.


                   In written comments on a draft of this report, the Corporation concurred
Corporation        that improvements were needed and noted that based on our findings it
Comments and Our   has already taken or is taking action to remedy the deficiencies we
Evaluation         identified. For example, the Corporation stated that it has completely


                   Page 16                             GAO/NSIAD-99-41 Civilian Markmanship Program
B-281768




revised its policies for background checks and will soon discontinue its
reliance on the Defense Security Service. The Corporation also stated that
in the future all applications for firearm purchases will be directed to the
newly-established National Instant Criminal Check System, with the
exception of those individuals exempted by the Brady Act who have
demonstrably been cleared by other means. The Corporation observed
that our report makes no reference to the remedial actions taken by the
Corporation. We have not commented on these actions because they were
taken after our review and we did not evaluate them or their impact on
CMP operations.


The Corporation agreed that its procedures were inadequate and were not
always adhered to, although the Corporation believes that we overstated
the significance of these deficiencies. Based on our random sample of the
Corporation’s sales records for three types of firearms, we reported
deficiencies that resulted because the Corporation did not always adhere
to its own procedures. We believe these deficiencies were properly
characterized.

The Corporation agreed that ongoing oversight of its operations would be
beneficial. The Corporation further stated that it has retained a firm of
independent certified public accountants to perform an annual audit,
which will encompass a review of its sales program, including an
evaluation of the Corporation’s compliance with the enabling legislation
and an assessment of its internal controls. We believe that such oversight
will help to ensure that the Corporation’s firearms sales fully comply with
the law.

In addition to its general comments, the Corporation submitted three
detailed comments. First, the Corporation stated that we did not
accurately describe its mission. It stated that Congress has given the
Corporation a considerably broader statutory objective. Accordingly, the
Corporation stated that its declared mission envisions “fostering rifle
marksmanship and firearms safety and other types of training to America’s
youth and other qualified citizens, emphasizing safety, discipline and
dedication to the nation, state and community.” We believe that our report
accurately describes the functions of the CMP as set out in section 1612(a)
of the 1996 act. We have, however, added in our report a reference to
section 1612(b) of the act, which discusses the youth-related priorities the
Corporation is statutorily required to consider in carrying out its mission.




Page 17                            GAO/NSIAD-99-41 Civilian Markmanship Program
              B-281768




              Second, the Corporation stated that our findings regarding the
              Corporation’s failures to adhere to its procedures are overstated and no
              longer applicable to CMP operations. Our randomly selected sample of
              Corporation sales records for three types of firearms sold to individuals
              showed that the Corporation sold firearms without adhering to its
              procedures designed to ensure that purchasers had not been convicted of
              felonies, were U.S. citizens, and were members of a CMP-affiliated club. We
              continue to believe that the results of our three samples were properly
              characterized. Regarding the Corporation’s recent procedural changes, we
              commend the Corporation for its willingness to respond to our findings
              immediately.

              Finally, the Corporation stated that we greatly exaggerated the value of
              federal support provided to the Corporation by using the Army Master
              Data File values to determine the value of the rifles, ammunition, and parts
              that were transferred or were being held by the Army for potential transfer
              to the Corporation. More specifically, the Corporation stated that the
              rifles, ammunition, and parts provided by the Army were obsolete,
              militarily worthless, and would be reduced to scrap at further cost to the
              Army. We believe that the Army Master Data File values are valid for
              determining the value of the items transferred or being held for potential
              transfer to the Corporation. Additionally, we noted in our draft report that,
              according to Army officials, providing these items to the Corporation
              actually resulted in a cost savings to the Army because the Army’s
              alternatives were either to incur costs to continue storing the items or to
              incur costs to demilitarize them.

              The Corporation’s comments are reprinted in their entirety in appendix II.
              The Corporation also provided technical comments, which were
              incorporated as appropriate.


              To evaluate whether the CMP’s transition from the Army to the private
Scope and     Corporation was conducted in accordance with the Corporation for the
Methodology   Promotion of Rifle Practice and Firearms Safety Act, we identified the
              transition requirements stipulated in that act. We also interviewed Army
              and Corporation officials and examined their records to compare
              transition actions with the requirements of the act.

              To determine the statutory requirements regarding sales of firearms, we
              reviewed the act and other applicable firearms statutes. We also




              Page 18                            GAO/NSIAD-99-41 Civilian Markmanship Program
B-281768




interviewed Bureau of Alcohol, Tobacco, and Firearms officials to discuss
these statutes.

To assess the Corporation’s compliance with the 1996 act in regard to
firearms sales, we randomly sampled firearms sales of three of the four
types of firearms sold by the Corporation to individuals—M1 Garands,
M1Ds, and .22 caliber rifles. Because of the small number of such sales, we
did not sample any of the 39 M1903A3s sold. For the M1 Garand, the
sampling error is plus or minus 8 percent or less with a 95-percent
confidence level. The sample was taken from a universe of approximately
6,400 applications approved for firearm sales between July 1997 and
August 1998. We excluded from our universe applications processed from
October 1, 1996, through June 30, 1997, to (1) minimize the possibility that
the Army processed parts of some applications and (2) provide the
Corporation with time to standardize its procedures after taking over the
program. We stopped sampling M1D and .22 caliber sales records when
the Corporation official who approved the applications confirmed that the
application procedures had not been strictly followed; thus, we did not
calculate sampling errors for the M1D and .22 caliber sales.

To determine the type and number of firearms the Corporation sold to its
affiliated clubs and to individuals, we interviewed Corporation officials
and obtained Corporation records of sales. To determine the type and
number of firearms the Corporation had on loan, we interviewed
Corporation officials.

We did not review the sales of firearms to Corporation-affiliated clubs
because many of the clubs had been established when the Army ran the
CMP. In addition, some of the data needed to determine whether
procedures had been followed either were not maintained by the Army or
were indecipherable in the microfiche files provided to the Corporation by
the Army.

We were unable to review the information resulting from DSS background
investigations, which the Corporation factored into its decisions to
approve applicants for firearms purchases. As required by DSS, the results
of each investigation were destroyed once the Corporation made its
decision.

To determine viable alternatives for providing oversight of Corporation
firearms sales, we interviewed officials from the Corporation and the




Page 19                            GAO/NSIAD-99-41 Civilian Markmanship Program
B-281768




Army. We also discussed this issue with the Bureau of Alcohol, Tobacco
and Firearms.

To identify the value of federal assets transferred to the Corporation at the
time of transition, we reviewed an Army report on the assets held by the
CMP before the program’s transition and the supporting workpapers for
that report. We also reviewed the Army’s files of the transfer.8

To determine the continuing cost of the program to the federal
government, we interviewed officials of the Army, Defense Logistics
Agency, Defense Security Service, and the Corporation. We also examined
documents they provided related to unreimbursed support for the
Corporation and its cost.

To determine the types and number of firearms the Army transferred to
the Corporation and has stored for potential transfer, we reviewed the
supporting workpapers to the Army report on the assets held by the CMP
before the program’s transition, Army records of transfers, and Army and
Defense Logistics Agency inventory records. We used Army Master Data
File values to determine the value of firearms transferred to the
Corporation.

We conducted our review from April to December 1998 in accordance with
generally accepted government auditing standards.


As agreed with your office, unless you publicly announce its contents
earlier, we plan no further distribution of this report until 30 days from the
date of this report. At that time, we will send copies of this report to the
Chairmen of the House and Senate Committees on Armed Services; the
Secretaries of Defense and the Army; the Directors of the Defense
Logistics Agency and the Office of Management and Budget; and the
Chairman of the Board of Directors, Corporation for the Promotion of
Rifle Practice and Firearms Safety. We will also make copies available to
others upon request.




8
 Assets of the Civilian Marksmanship Program (Army Audit Agency, 96-312, Sept. 27, 1996).



Page 20                                        GAO/NSIAD-99-41 Civilian Markmanship Program
B-281768




Please call me at (202) 512-5140 if you or your staff have any questions
concerning this report. Other major contributors to this report are listed in
appendix III.




Mark E. Gebicke
Director, Military Operations
  and Capabilities Issues




Page 21                             GAO/NSIAD-99-41 Civilian Markmanship Program
Contents



Letter                                                                                               1


Appendix I                                                                                          24
Comments From the
Department of
Defense
Appendix II                                                                                         25
Comments From the
Corporation for the
Promotion of Rifle
Practice and Firearms
Safety
Appendix III                                                                                        30
Major Contributors to
This Report
Tables                  Table 1: Firearms Sold by the Corporation During Fiscal Years                6
                          1997 and 1998
                        Table 2: Purchases the Corporation Approved Without Following                9
                          Its Procedures to Ensure Compliance With the 1996 Act
                        Table 3: Property Transferred to the Corporation at Transition of           10
                          the CMP
                        Table 4: Value of Unreimbursed DOD Support Provided to the                  12
                          Corporation
                        Table 5: Types and Numbers of Firearms Transferred to the                   13
                          Corporation
                        Table 6: Firearms Stored for Potential Transfer to the                      15
                          Corporation


Figure                  Figure 1: M1 Garand Semiautomatic Rifle                                      5




                        Page 22                            GAO/NSIAD-99-41 Civilian Markmanship Program
Contents




Abbreviations

ATF        Bureau of Alcohol, Tobacco, and Firearms
CMP        Civilian Marksmanship Program
DOD        Department of Defense
DSS        Defense Security Service


Page 23                          GAO/NSIAD-99-41 Civilian Markmanship Program
Appendix I

Comments From the Department of Defense




             Page 24      GAO/NSIAD-99-41 Civilian Markmanship Program
Appendix II

Comments From the Corporation for the
Promotion of Rifle Practice and Firearms
Safety




               Page 25       GAO/NSIAD-99-41 Civilian Markmanship Program
Appendix II
Comments From the Corporation for the
Promotion of Rifle Practice and Firearms
Safety




Page 26                                    GAO/NSIAD-99-41 Civilian Markmanship Program
Appendix II
Comments From the Corporation for the
Promotion of Rifle Practice and Firearms
Safety




Page 27                                    GAO/NSIAD-99-41 Civilian Markmanship Program
Appendix II
Comments From the Corporation for the
Promotion of Rifle Practice and Firearms
Safety




Page 28                                    GAO/NSIAD-99-41 Civilian Markmanship Program
                       Appendix II
                       Comments From the Corporation for the
                       Promotion of Rifle Practice and Firearms
                       Safety




Now on pp. 2, 10-12.




                       Page 29                                    GAO/NSIAD-99-41 Civilian Markmanship Program
Appendix III

Major Contributors to This Report


                        Carol R. Schuster
National Security and   Derek B. Stewart
International Affairs   Jack E. Edwards
Division, Washington,
D.C.
                        Richard P. Burkard
Office of the General   Maureen A. Murphy
Counsel, Washington,
D.C.




(703240)                Page 30              GAO/NSIAD-99-41 Civilian Markmanship Program
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