oversight

Department of Army | Redstone Arsenal, AL | 18-28 | Whistleblower Comments

Published by the Office of Special Counsel on 2018-08-08.

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

                                         DEPARTMENT OF THE ARMY
                                        OFFICE OF THE ASSISTANT SECRETARY
                                         MANPOWER AND RESERVE AFFAIRS
                                                111 ARMY PENTAGON
                                            WASHINGTON, DC 20310-0111




                                                                  OCT 1 3 2017
Acting Special Counsel Tristan Leavitt
U.S. Office of Special Counsel
1730 M Street, N.W. Suite 300
Washington, D.C. 20310-0101

                                                                RE: Whistleblower Investigation, Improper
                                                                Actions at Anny Oil Analysis Program
                                                                Office (AOAP) (Office of Special Counsel
                                                                File Number DI-15-5616)


Dear Mr. Leavitt:

        In accordance with Tille 5, United States Code, Sections 1213(c) and (d), the enclosed
report is submitted in response to your referral of information requesting an investigation of
allegations and a report of findings in the above referenced case.

       The Secretary of the Army (SA) has delegated to me his authority, as agency head, to
review, sign, and submit to you the report required by Title 5, United States Code, Sections
1213(c) and (d). fTAB Al.

         The Department of the Army (DA) has enclosed two versions of its report. The first
version of the report contains the names and duty titles of military service in.embers and civilian
employees of the DA This first version is for your official use only, as specified in Title 5,
United States Code, Section 1213(e); we understand that, as required by that law, you will
provide a copy of this first version of the report to the Whistleblower, the President of the United
States and the Senate and House Armed S~rvices Committees for their review. Other releases of
the first version of the report may result in violations of the Privacy Act 1 and breaches of
personal privacy interests.

        The second version of the report has been constructed to eliminate references to privacy-
protected information and is suitable for release to all others as well as any regulations that
require protection. We request that only the second version of the repo1i be made available on
your web-site, in your public library, or in any other forum in which it will be accessible to
persons not expressly entitled by l&w to a copy of the report.




i   The Privacy Act of 1974, Title 5, United States Code, Section 552a.
        INFORMATION INITIATING THE INVESTIGATION

         By correspondence dated February 7, 2017, the Office of Special Counsel (OSC)
forwarded to the Acting Secretary of the Army allegations from an anonymous Whistleblower
that, if accurate, Department of the Army officials may have engaged in actions that constitute a
violation of law, rule, or regulation; gross mismanagement; and a gross waste of funds at the
Army's Utility Helicopters Project Management Office, Redstone Arsenal, Alabama. [TAB B].
As reflected in the OSC's referral correspondence, according to the Whistleblower, the mission
of the AOAP, a component of the Army Support Agency (LOGS A), is to function as the Army's
sole oil analysis program. Further, according to its charter, the Whistleblower pointed out that
the AOAP's primary responsibility is "ensuring that the Warfighter is supported with the most
technologically advanced diagnostic tools to monitor lubricants for the presence of contaminants,
abrasive past wear, and review of prescribed physical properties for determining the condition of
lubricants to enable detection of impending failures before catastrophic failures occur."
Additionally, the Whistleblower highlighted that the AOAP's stated objective is to "detect
impending equipment component failures and determine lubricant condition through on-line and
laboratory evaluation of oil samples." To that end, the Whistleblower made the following general
allegations:

        OSC Referred Allegation l : Army leadership has failed to direct aircraft program
managers to use test processes offered by the Am1y Oil Analysis Program (AOAP) despite Army
polfcies requiring participation in AOAP processes;

        OSC Referred Allegation 2: the failure to employ AOAP resources has resulted in the
gross waste of approximately $95 million annually [due to preventable false positive chip
identification} and has prevented AOAP from fully meeting its mission objectives; and

       OSC Referred Allegation 3: that T700 Office of Product Manager leadership refused to
approve funding [for approximately $120,000] for a chip analyzer for use by the AOAP.

                      CONDUCT OF THE INVESTIGATION
         Upon receiving the February 7,2017 OSC referral letter, the ArJily Office of the General
Counsel (OGC) diligently began to analyze which Army organization it would recommend to the
Acting Secretary of the Army to investigate the subject allegations. Upon its initial review of the
OSC's referral letter, OGC determined that it needed greater clarity as to which organiz.ations
and individuals were the subject of the Whistleblower's allegations. This, in turn, would
facilitate in determining which Army organization would be in the best position to investigate the
referred allegations and to ensure that the allegations were specific enough to generate a
thorough investigation into them. Consequently, on February 14, 2017, OGC requested
assistance from OSC with respect to additional clarifying information as to what exactly were the
issues that the Whistleblower had raised, the organizations that the Whistleblower claimed had
                                                 2
failed to perform their responsibilities, and whose decision-making processes were at issue. On
February 21, 2017 a discussion with OSC ensued and OGC requested that OSC inquire with the
anonymous Whistleblower for greater clarity with respect to the exact nature of the allegations
and to provide the names of specific individuals who committed the alJeged misconduct and their
organiz.ational affiliation. 2 This direct assistance from OSC was needed since normally the
agency would be able to receive greater specificity directly from the Whistlebtower during the
Whistleblower's interview. However, since in the instant case the allegations were made by an
anonymous Whistleblower, the Anny would not have been able to develop the much needed
initial background facts given that the allegations had been made by an anonymous
Whistleblower. Hence, when it received this additional information from the OSC, OGC
determined that the Headquarters Department of the Army's Assistant Secretary of the Army
(Acquisition, Logistics and Technology) (ASA (ALT)) should be tasked by the Acting Secretary
of the Army to conduct the requisite investigation and resulting report of investigation.

        On February 28, 2017, the Acting Secretary of the Army forwarded the OSC's
correspondence to the ASA (ALT) for appropriate action, including the initiation of an
investigation into the allegations pursuant to Army Regulation (AR) 15-6, Procedures for
Investigating Officers and Boards of Officers, and taking appropriate corrective actions. [TAD
C]. Based on the investigation, an Anny report would be prepared for submission to OSC as
required by 5 USC§ 1213 for the above captioned OSC case.

        Immediately upon receiving the Acting Secretary's referral, the Acting ASA (ALT), Ms.
Steffanie Easter, designated the Acting Principal Deputy to the ASA (ALT), Mr. Christopher
Lowman, as the Appointing Authority for this investigation. Mr. Lowman began identifying
possible Investigating Officers (IO) to conduct the investigation. Unfortunately, the first
identified individual was due to retire soon after the investigation would be initiated and another
potential IO had to be identified. Given this lapse in time, the designated IO was not identified
and appointed until March 14, 2017. [TAB D]. The new IO, Headquarters, Department of the
Army, Office of the Deputy Chief of Stan: G-4, Pentagon, began his investigation duties upon
completing an outstanding program review that he had to complete from March 14-17, 2017. The
[0 began his 10 duties on March 20, 2017 which included completing a comprehensive
reference review of relevant publications and investigation instructions.
        The IO completed his Report oflnvestigation on September 6, 2017 and forwarded it to
the Approving /\uthority, Mr. Lowman, on September 2 I, 2017 who approved it on September
25,2017.


2
 On February 22, 2017, the OSC staff provided the following specific names from the Whistleblower to
be interviewed: (1) Assistant Project Manager T700; (2) Technical Chief, T700; (3) Office of the
Program Executive Officer for Aviation; (4) U.S. Army Aviation and Missile Command (AMCOM); (5)
Army Working Capita! Fund Staff; (6) Army Working Capital Fund Staff; (7} Anny Working Capital
Fund Staff; and (8) Unnamed staff from the U.S. AMCOM Aviation Engineering Directorate and
Acquisitions Logistics Center.




                                                 3
                                      BACKGROUND
        The IO was appointed to investigate the facts and circumstances surrounding the
Whistleblower's allegations that the Army had fail.e d to employ the state-of-the art technology
offered by the AOAP at the Anny's Utility Helicopters Project Office, Redstone, Arsenal,
Alabama pursuant to an AR 15-6 investigation .. The purpose of this investigation was to
determine the validity of the whistleblower's allegations and make findings concerning whether
any wrongdoing had occurred, and if so, by whom, and whether adequate policies and
procedures are in place to preclude any recurrences of any improprieties, irregularities, or
misconduct disclosed during the investigation. During the personnel interview process
undertaken by the 10, the lO interviewed 15 witnesses .. However, the IO determined that after
interviewing all of the witnesses, not all of the interviewees (including those individuals whose
names the anonymous Whistleblower had provided to the OSC to forward to the agency in its
February 22, 2017 email transmission) had information pertinent to the investigation. ln some
instances, several of the witnesses provided testimony which was similar in content to other
witnesses. Additionally, with approval of the Appointing Authority, the Program Executive
Officer/Deputy Program Executive Officer for Aviation, Brigadier General Todd, and, the
Commander, U.S. Army Materiel Command Logistics Support Activity were not interviewed as
the 10 anticipated the information garnered from these two individuals would be cumulative
and/or duplicative. The testimonial and documentary evidence gathered during the AR I 5-6
investigation resulted in a Report of Investigation (Rol) which formed the basis for this Army
narrative report.

        To facilitate a better understanding of the facts and circumstances associated with the
Whistleblower's allegations to the OSC and to permit a more informed assessment of the
testimonial and documentary evidence collected in this matter, it is important to understand the
relevant organizations' mission and functions and their role and responsibilities as well as those
of their higher headquarters that had a role in the events discussed in the Whistleblower's
allegations. Additionally, a working knowledge of the laws, rules, regulations, and policie.s that
govern the Army Oil Analysis Program (AOAP) is also essential to analyzing the merits of the
Whistleblower's allegations. A summary of those relevant authorities is also provided below .

                                                                     •
             ORGANIZATIONAL ROLES AND RESPONSIBILITIES
        Generally, for our purposes, it is important to understand that there are two lines of
authority which impact the AOAP program. One line of command is the chain of command for
the Program Manager, Army Oil Analysis Program (PM, AOAP), while the other is the chain of
command which affects the T700 engine that the Whist1eblower alleged was not utilizing the
AOAP program's diagnostic tools.




                                                 4
       CHAIN OF COMMAND FOR PM, AOAP

        With respect to the chain of command for the PM, AOAP, the PM, AOAP's chain of
command falls under the Army Materiel Command Logistics Support Activity (LOGSA).
LOGSA is a Separate Reporting Activity under the U.S. Anny Materiel Command (AMC), a
four-star Army Command (ACOM) that reports directly to the Chief of Staff, Army (CSA).

        AMC. The Commander, AMC reports to the CSA for ACOM responsibilities, directives,
authorities, policies, planning and programming guidance. Additionally, the Commander, AMC
is responsible to the Secretary of the Army for execution of applicable responsibilities contained
in IO United States Code 3013(b). [TAB E. AR 10-87, Army Commands, Army Service
Component Commands, and Direct Reporting Units].

        AMC is headquartered at Redstone Arsenal, Alabama, and impacts or has a presence in
all 50 states and 150 countries. Manning these organizations is a work force of more than 70,000
dedicated military and civilian employees, many with highly developed specialties in weapons
development, manufacturing and logistics.

        The AMC mission is to develop, deliver, and sustain materiel to ensure a dominant joint
force for the U.S. and its allies. As the Army's Lead Materiel Integrator (LMI), AMC manages
and distributes the right equipment in the right quantity when and where Soldiers need it. AMC
also designs and develops sophisticated innovations for combat weapons systems to improve
survivability and lethality. AMC depots and arsenals refurbish, repair and overhaul every type of
major weapon system in the Anny inventory.

        AMC unifies and synchronizes all of the materiel life cycle functions nested with Major
Subordinate Commands providing Capability Based Solutions: research, development,
acquisition, testing, distribution, supply, maintenance, industrial base options and disposal. AMC
is the Army's premier provider of materiel readiness--technology, acquisition support, materiel
development, logistics power projection, and sustainment--to the total force, across the spectrum
of joint military operations. If a Soldier shoots it, drives it, flies it, wears it, eats it, or
communicates with it, AMC provides it.

         However, with respect to the full command and authority over the PM, AOAP, it is
important to note that while PM, AOAP is not organizationally aligned under Headquarters
Department of the Am1Y, Deputy Chief of Staff, 0-4 (HQDA, DCS, 0-4) the AOAP Charter
states: "The PM, AOAP is responsible for all action items related to the AOAP and will report
through HQ AMC G-3/5 to the HQDA G-4." [TAB F, See AOAP Charter].

       HQDA, DCS, G-4. The HQDA G-4, as a member of the Army Staff (ARST) provides
professional assistance to the Secretary of the Army, Under Secretary of the Army, Assistant
Secretaries of the Army (ASAs), and the CSA. [n each of their respective areas of functional
responsibility, the members of the ARSTAF are assigned responsibility for matters which
include (I) supporting the Secretary of the Army in executing the responsibilities of the
Secretary of the. Army as the head of the Army and the Under Secretary of the Army in executing
responsibilities assigned to the Under Secretary of the Army; (2) supporting the CSA in
executing responsibilities as CSA and as a member of the Joint Chiefs of Staff, and supporting
                                                 5
the Vice Chief of Staff of the Army (VCSA) in the execution of responsibilities assigned to the
VCSA; and (3) serving as principal military advisers to the ASAs, including providing
independent, professional military advice.

        The DCS, G-4 is the principal military adviser to the Assistant Secretary of the Army
(Acquisition Logistics and Technology) (ASA (ALT)) for logistics. Further, the DCS, G-4 is the
principal ARST AF adviser to the CSA on logistics and assists the CSA in acting as the agent of
the Secretary of the Army in carrying into effect approved plans and recommendations. Under
the supervision of ASA (ALT), for Anny logistics and sustainment issues, the DCS, G-4
develops and executes Army strategy, policy, plans and programs for logistics and sustainment;
ensures the execution of policies, plans and programs consistent with law, regulation and policy
by other DA officials and organizations; and reviews and assesses the execution of Army
logistics policies, plans and programs. The DCS, G-4 is assigned responsibility for such matters
as (I) collaborating on logistics operations in support of security cooperation and representing
the Army on coalition sustainment standardization actions; (2) maintaining current logistics
operations, contingency plans and resource programs that support Army-wide logistics
operations; and (3) serving as proponent for Anny equipment safety and Army airworthiness.
[TAB G, General Orders No. 2017-01, Assignment of Functions and Responsibilities Within
Headquarters. Department of the Army, January 5, 2017).

          CHAIN OF COMMAND FOR MANAGEMENT OF THE T700 .ENGINE

      The T700 aircraft engine, discussed in the Whistlcblower's allegations, is managed in a
completely separate reporting chain from the PM, AOAP.

         Within the world of Department of Defense (DoO) defonse acquisition programs and
responsibilities, there is a support structure assigned to various functional areas or programs
referred to as Program Executive Officers (PEOs). Each of the DoD services and/or components
have their respective PEOs under their responsibility. Generally, a PEO is a military or civilian
official assigned program responsibilities for Acquisition Category (ACA T) I and IA and
sensitive classified programs, or for any other program detennined by the Component
Acquisition Executive (CAE) to require dedicated executive management. A PEO is the main
stakeholder responsible for cost, schedlilc and performance in these DoD acquisition programs
and/or portfolios. A PEO may be responsible for a specific program (e.g., the Joint Strike
Fighter), or for an entire portfolio of similar programs (e.g., Aviation). DoDI 5000.02.

        Project Manager, T700 (PM T700). The Project Manager, 1700 falls under Program
Manager, Utility Helicopters, which is an office within Program Executive Office, Aviation
(PEO A VN). PEO A VN leads and executes the Army's Life Cycle Management for Aviation
Weapon Systems. In accordance with AR 70-1, Anny Acquisition Policy, PEO A VN reports
directly to the Assistant Secretary of the Army (Acquisition, Logistics and Technology) (ASA
(ALT) in that official's capacity as the Army Acquisition Executive.

       ASA ALT. The ASA (ALT) is the principal adviser to the Secretary of the Army on all
matters relating to acquisition, logistics and technology. The ASA (ALT) is responsible for the

                                                6
overall supervision of the acquisition, logistics and technology matters of Department of the
Army and has sole responsibility for performing the acquisition function within HQDA. The
ASA (ALT) is designated as the Army Acquisition Executive (AAE), Senior Procurement
Executive, and Senior Official responsible for the management of acquisition of contract
services, Science Adviser to the Secretary of the Army and senior research and development
official for DA.

        The ASA(ALT) is responsible for setting the strategic direction for and ensuring that DA
policies, plans and programs related to acquisition, logistics, technology, procurement, the
industrial base, materiel related security cooperation (including security assistance and
armaments cooperation), and the Army's portion of the Chemical Demilitarization Program are
executed consistent with law, regulation and policy. Additionally, the Office of the ASA (ALT)
is designated the single office for the acquisition function in HQDA and, subject to the authority,
direction and control ofthe Secretary of the Army, provides the CSA such staff support for
acquisition matters as the CSA considers necessary to perform his duties and responsibilities.

        The ASA (ALT) is assigned responsibility for such areas as ( 1) establishing strategic
direction for aspects of the program, planning, budget and execution process within the ASA
(AL T)'s assigned functions and responsibilities, including acquisition, logistics, technology.
procurement and associated resource al location decisions and policies and, when appropriate,
coordinating and integrating that direction with other ASAs and AR Staff offices; (2) providing
strategic guidance and supervision for policies and programs for Anny procurement, logistics
and technology initiatives executed by DA officials, organizations and commands; (3) executing
the authorities of the agency head for contracting procurement matters pursuant to laws and
regulations; and (4) supervising logistics, including acquisition fielding, sustainment and
disposal logistics management, and administering life-cycle logistics support planning and
execution. ITAI3 G. General Orders No. 2017-01, Assignment of Functions and Responsibilities
Within Headquarters, Department of the Army, January 5,2017].



                    RULES AND REGULATIONS GOVERNING
                    THE ARMY'S MATERIEL MAINTENANCE
                          POLICY AND PROGRAMS


1. Army Working Capital Fund. The Army Working Capital Fund (AWCF). also known as the
Defense Working Capital Fund, Army (DWCF, A) operates numerous commercial-like and
industrial facilities that provide essential services and support for readiness and sustainability of
the warfighting forces. The A WCF includes two activity groups: Supply Management and
Industrial Operations. The A WCF, like all DWCFs, operates under a revolving fund concept, i.e.,
the A WCF relies on revenue from sales to finance operations rather than submitting a budget
proposal for direct appropriations from Congress.


                                                  7
       The A WCF operates as a business-like enterprise, managing cash in real-time and
expenses over time. The A WCF maintains cash on hand to support current operations; and
generates adequate revenue to cover the full costs of operations on a break-even basis over time,
without making a profit or incurring a loss. Since the A WCF operates without direct
appropriations, the fund operates without a fiscal year limitation on obligating money.

        The A WCF needs to recover the costs of what it acquires and the costs of operations in
order to break even. The customer rates are the result of the analysis of the full costs of
operations. The AWCF uses the customer rates to adjust the prices of what it sel.ls to recover the
full costs of operations. The customer rates establish the ultimate price that customers pay for
materiel. The rates vary by activity group. For example, the Supply Management activity group
buys and maintains assigned stocks of materiel for sale to its customers and the Industrial
Operations activity group maintains end items and depot-level repairables and manufactures,
renovates, stores, ships and demilitarizes munitions for all services within DoD and foreign
military customers.

        When a depot level repairable (DLR) is found non-mission capable (NMC), the customer
turns in the DLR to an Army supply activity, receiving a credit for the NMC DLR. The NMC
DLR is returned to an Army Depot in order to be renovated and returned to'the supply system for
issue. The customer then receives a renovated DLR in return. The customer receives a credit for
the NMC DLR and is charged for the issued DLR at the renovated rate which is significantly
lower than a new DLR from the manufacturer. TT AB H, 10 United States Code. Section 2208,
Wotking-capital funds; and TAB I, Assistant Secretary of the Army/Financial Management &
Comptroller A WCF Resource Manager's Course Material (Source- Army G-4 A WCF Subject
Matter Expertj.

2. Army Regulation (AR) 750-1, Army Materiel Maintenance Policy. [TAB J, Army Materiel
Maintenance Policy]. This regulation was recently updated, and the current version is dated 3
August 2017. The version in effect during the timeframe of the Whistleblower's allegations is
dated 12 October 2013 . However, the relevant AOAP coverage in both versions is identical.

        According to the Summary section, this regulation covers "Department of the Army
policy for general maintenance operations; commodity-oriented maintenance operations;
maintenance management systems; inter-Service and contract maintenance support; sustainment
maintenance including national maintenance; maintenance support during acquisition;
maintenance programs; and depot maintenance." The proponent of this regulation is the Army
Deputy Chief of Staff, G-4 (Logistics), and this regulation is approved by the Secretary of the
Army. While this regulation covers various subjects other than the AOAP, several sections are
directly relevant to the AOAP and the Whistleblower's allegations.

       "Ch apter 2 Responsibilities . . ,
       Section 2-7. Deputy Chief of Staff, G-4 ...

                                                 8
      u. Serve as the proponent for the Army Oil Analysis Program (AOAP) and
      approve Army input to the DoD Joint Oi I Analysis Program .. .

      ff. Approve weapon system and component enrollment in the AOAP
      through coordination with LCMCs, program executive officers (PEOs),
      and/or program managers, as well as the ACOMs, ASCCs, and DR Us
      [Army Commands, Army Service Component Commands, and Direct
      Reporting Units]."

"Section 2-15. Commanding General, U.S. Army Materiel Command (AMC) ...

      g. Responsible for management of program operations and execution for
      the AOAP, to include-
      (I) Designating the AMC Logistics Support Activity (LOGS A) as the DA
      PM for the AOAP.
      (2) Designating Commander, AMC LOUSA responsibility to appoint the
      PM AOAP.
      (3) Implementing this regulation and AR 700-132 ...
      (5) Ensuring that AMC LCMCs-
      (aJ Recommend sy~tems for inclusion in the AOAP and sampling intervals
      for these systems. The PEO and/or PM for the specific weapon systems
      will approve and submit the recommendations to the PM AOAP.
      Recommendations may be submitted at any time during the year. At the
      beginning of each calendar year, the PM AOAP will facilitate a formal
      review process ...
      ( 17) Hosting an annual in-process review with the DCS, G-4, ACOMs,
      ASCCs, and DRUs, AMC LCMCs, PEOs, and/or PMs to review program
      operations, requirements, and coordinating program out-year planning
      objectives. This includes a revi1::,v of systems and/or components enrolled,
      sampling intervals, and wear-metal crileria.
      ( 18) Developing and pub Iishing, not later than 45 days following the end
      of the fiscal year (FY), an annual executive summary outlining program
      operations, benefits, and costs.
      ( 19) Serving as proponent for Technical Bulletin (TB) 43-0211 and as
      Anny coordinating authorit) for AOAP procedures and material contained
      in all Army and Joint Service regulations, TBs, pamphlets, and field
      manuals (FMs) .... "

"Chapter 8 Maintenance Programs . ..
Section 8-2. Arn,) Oil Analysis Program

       The objectives of the AOAP are to improve operational readiness of Army
       equipment, enhance safety, detect impending component failures, and
       conserve petroleum resources through application of the on conditior1 oil
       change (OCOC) policy. AOAP monitors lubricants for the presence of
                                       9
               contaminants. abrasive part wear. and review of prescribed physical
               properties and consolidates analytical data in support of diagnostic and/or
               prognostic maintenance processes.

           a. ProKram policies.

           (I) The AOAP PM manages the Anny's oil analysis program. Enrollment in
               the AOAP is mandatory for all Army aircraft, combat vehicles, watercraft,
               and locomotives unless the DCS, G-4 approves the exception. Selected
               nonaeronautical equipment may be enrolled in the AOAP on a case-by-
               case basis, \vhen resources are available. For a list of equipment and
               components enrolled in the AOAP, see TB 43-0211 or the AOAP Web
               site at https://liw.logsa.army.mil...."

3. AR 700-132, Joint Oil Analysis Program. [TAB K]. The AR 15-6 Investigating Officer
included a copy of this AR in his Report oflnvestigation for completeness. This publication
delineates high level Service Secretary responsibilities and Joint Oil Analysis Program
objectives. Generally the JOAP was instituted to maximize inter-Service use of oil analysis
through consolidation of laboratories; coordination of support; and standardization of
instrumentation, analytical techniques, data, forms and customer laboratory procedures. The
intent of the JOAP is to enhance jointness, reduce cost, and combine missions where feasible.

        In addition, the JOAP is intended to provide non-reimbursable routine support to all
Department of Defense and USCG transient customers and permanent customers in each JOAP-
certified laboratory's assigned area of responsibility.

         The JOAP was instituted to improve the operational readiness and economy of military
equipment through the use of oil analysis, a condition monitoring concept that relies on the
detection and measurement of wear-metals and the determination of a lubricant's physical
properties~ collect and analyze oil analysis trend data to increase the effectiveness of oil analysis
techniques in the diagnosis of potential equipment failures; provide wear-metal and lubricant
physical property data to the various weapon systems managers and others, as required; test,
evaluate, and promote new and emerging techniques, teclinologies, and equipment for oil
analysis and ensure all Army, Navy, and Air Force oil analysis plans and operations are
integrated to provide standardized laboratory techniques, procedures, data, calibration standards,
analytical instruments, and inter-Service oil analysis support to all military departments, where
practicable.

4. Technical Bulletin (TB) 4.i-0211, Army Oil Analysis Program (AOAP). [TAB L]. This
publication is prescribed by AR 750-1. The current version of this publication is dated 30 April
2010. Its Forward states:

               "The Am1y Oil Analysis Program (AOAP) is part of a Department of
               Defense program to detect impending equipment component failures and
               determine lubricant condition through laboratory evaluation of lubricant

                                                  10
              samples. Through application of laboratory non-destructive analytical
              techniques, flight safety is improved, equipment readiness is enhanced,
              and resources can be conserved. The Program Manager (PM) AOAP
              provides operational management of the oil analysis program. The
              objectives, policies, and the responsibilities of commands participating in
              the AOAP are prescribed in AR 750-l. Army Materiel Maintenance
              Policy .... "

       Its Program Description adds:

              "AOAP is part of the Army Condition Based Maintenance Plus (CBM+)
              program using proactive component and lubricant condition-monitoring
              technologies to analyze lubricant samples extracted from enrol led
              components on a scheduled basis. Worldwide laboratories equipped with
              advanced diagnostic instruments can detect and measure damaging
              component -wear particulate and lubricant contamination before it
              becomes visible to the human eye. Proactive maintenance is known within
              the Anny maintenance arena as the single most important means of
              achieving savings unsurpassed by conventional maintenance techniques.
              The approach supplants the maintenance philosophy of "failure reactive"
              with "failure proactive" by avoiding the underlying conditions that lead to
              component faults and lubricant degradation. Unlike predictive/preventive
              maintenance, proactive maintenance commissions corrective actions
              aimed at failure root causes, not just symptoms. lts central theme is to
              extend the life of the component as opposed to making repairs when often
              nothing is broken, accommodating failure as routine and normal, or
              preempting crises failure maintenance in favor of scheduled maintenance."

        The TB identifies equipment enrolled in the AOAP, provides instructions on taking oil
samples, and provides guidance for installation and unit management of AOAP operations. It
states "As outlined in AR 750-1, AOAP is mandatory for all AOAP enrolled equipment." While
an earlier version of the TB included appendices that listed AOAP enrolled equipment, the most
recent version refers readers to LOGSA 's AOAP website for this information. The TB goes on
to state "Equipment will be removed from the AOAP in accordance with procedures outlined in
AR 750-1 and AMC 11-47. Recommendations to remove equipment from the AOAP will be
made by written request, supported by justification, to PM AOAP."

5. Department of the Army Program Manager Charter for the Army Oil Analysis Program.
The charter was approved by the Anny Deputy Chief of Staff, G-4 on or about I August 2008.
rrAB F]. Among other things it states that "The PM AOAP is responsible for all action items
related to the AOAP and will report through HQ AMC G-3/5 to the HQ DA G-4."




                                               11
The Charter's Mission description states:

   "The AOAP objectives are to improve operational readiness of Army
   equipment, enhance safety, detect impending component failures and conserve
   Army equipment, enhance safety, detect impending component failures, and
   conserve resources through application of the On-Condition Oil Change
   policy. The PM will meet the AOAP objectives by ensuring that the war
   fighter is supported with the most technologically advanced diagnostic tools.
   These tools will monitor lubricants for the presence of contaminants, abrasive
   part wear, and review of prescribed physical properties for determining the
   condition of lubricants to enable detection of impending failures before
   catastrophic failures occur."

The Responsibilities section states:

   "( 1) In accordance with AR 700-132, JOAP, the PM shall coordinate oil
   analysis research, development, inter-service operations and test and
   evaluation projections with the Navy and Air Force Oil Analysis Program
   Executives in order to improve, complement. and replace existing testing
   techniques without duplicating efforts ...

   (2) The PM has total management responsibility for the AOAP and Command
   and Control (C2) of all AOAP laboratories and operations. Specific
   responsibilities include: ...

       (b) Establishing and maintaining C2 ofregional fixed based laboratories
       and mobile laboratories ... to include all actions associated with: I.
       Managing a single centralized contract for laboratory operations;
       research/development, acquisition and testing of new diagnostic
       equipment. .. 3 Providing program funding requirements to HQ AMC G-
       3/5 and G-8 for submission to the HQ DA 0-4 for approval/disapproval ...

       (e) Participating in the enrollment/disenrollment process. The LCMC
       (Life Cycle Management Command) submits enrollment/disenrollment
       requests to HQ AMC G-3/5 for staffing. The AMC G-3/5 will forward the
       request to PM AOAP who determines resource availability to support the
       new enrolled equipment or the PM concurrence/nonconcurrence for
       disenrol!ment. The PM AOAP will forward a recommended action back
       to the AMC G-3/5 with resource requirements for new enrollments or
       rational for concurrence/nonconcurrence on the request to disenroll the
       equipment. The AMC G-3/5 will then forward the action to the HQ DAG-
       4 for consideration and final approval or forward the non-concurrence for
       disenrollment back to the LCMC for.further consideration or coordination
       with the PM...." (Emphasis added).


                                        12
      The Resource Control section adds:

              "a. The PM will ensure that dollar, manpower, and equipment
              requirements to accomplish the AOAP mission are developed and
              submitted in accordance with DA, AMC, and LOGSA planning,
              programming, budgeting, and execution systems.

               b. The HQ AMC G-3/5 Resource Integration Division will coordinate PM
               AOAP validated funding requirements with the responsible HQ DA, G-4
               Progr~ Executive for approval ...."



                                      DISCUSSION
The Office of Special Counsel requested that the Army investigate the following allegations:

   a. Whether Anny leadership has failed to direct aircraft program managers to use test
processes offered by the Army Oil Analysis Program (AOAP) despite Army policies requiring
participation in AOAP processes.

   b. Whether the failure to employ AOAP resources has resulted in the gross waste of
approximately $95 million annually and has prevented AOAP from fully meeting its mission
objectives.

   c . Whether T700 Office of Product Manager leadership refused to approve funding for a chip
analyzer for use by the AOAP.

The Investigating Officer's findings and conclusions are discussed below.




                             OSC Referred Allegation #1

    Whether Army leadership has failed to direct aircraft program managers to use test
    processes offered by the Army Oil Analysis Program (AOAP) despite Army policies
                        requiring participation in AOAP processes

       As an initial matter, in the course of his investigation the Investigating Officer (10)
fom1ally asked cognizant officials within Program Manager-Army Oil Analysis Program (PM-
AOAP). Program Manager, Utility Helicopters, and Project Manager, T700 whether they were
aware of any instances where "Army leadership," at any lev~l, failed to direct PMs or any other
Army personnel to use test processes offered by AOAP. Each witness provided a negative
response, and none of the documentary evidence compiled by the IO substantiates the allegation
that Army leaders failed to direct use of prescribed AOAP test processes.

                                               13
         More specifically, the 10 found that, based upon extensive engineering analysis detailed
below, the T700 engine has never been subject to a requirement to use AOAP processes due to
the performance of the engine's 3 micron oil filter, which is able to filter out particulate debris
smaller than AOAP laboratories are able to detect with their test equipment. The T700 engine
includes a chip detector and chip light indicator that provide a more accurate indication of
required maintenance. The 10 d.id find that the Department of the Army (DA) Deputy Chief of
Staff (DCS), G-4 (the DA-level AOAP proponent) never formally approved an exemption for the
T700 engine, as is required by Anny Regulation 750-1, and the IO has addressed this omission in
his recommendations, covered later in this letter. However, various witnesses, including PM
AOAP, confirmed that the T700 has never been officially enrolled in the AOAP [TAB M], and
the IO confirmed in his findings that the T700 engine is not listed in Army Technical Bulletin
43-0211, Army Oil Analysis Program (AOAP), Guide for Leaders and Users, which is the
official Army publication that lists equipment subject to AOAP sampling requirements. [TAB
L].

       The [O's Report of Investigation (RoI) includes a U.S. Army Aviation Systems
Command memorandum, dated January 29, 1985, which documents an Army decision, going
back to at least that date, to discontinue routine oil analysis on the T700 engine on the basis of
the engine's chip detector and three micron filtration. [TABs N-1 and N-2 (3 Micron Filter
Engines (T700), AOAP Component Evaluation Report].

        That subject was formally revisited beginning in the 2007-2008 timeframe as a result of a
September 24, 2007 U.S. Army Audit Agency (AAA) Report entitled "Followup Audit of Army
Oil Analysis Program - Restructure Plan." The AAA Report noted that AR 750- I requires
mandatory enrollment in the AOAP for all Army aircraft unless Army G-4 approves an
exception. The Report found, among other things, that the Anny's Aviation and Missile
Research, Development and Engineering Center (AMRDEC) "disenrolled" 76 aircraft
components without Anny G-4 approval. [TAB 0, AAA Rt:portJ. Although the affected
components were not specifically listed in the AAA report, various other documents in the Roi
readily confirm that the T700 engine was included in this category. [TABs N-1 and N-2 (3
Micron Filter Engines (T700), AOAP Component Evaluation Report); and TAB P (Statement
from Assistant Program Manager Utility, T700].


        As a result of the AAA report, a working group was established to provide a response to
the AAA; it focused on the "disenrnllment of 76 aircraft components without proper ODCS, g-4
approval." This working group determined that an I.ntegratcd Project Team (lPT) was needed to
further address the issues. As a result, the Army Aviation Oil Analysis Integrated Project Team
was chartered effective December 14, 2009. The !PT charter was co-signed by representatives of
Anny G-4, USAMC, AMRDEC, and PEO AVN. [TAD Q. Army Aviation Oil Analysis
Integrated Project Team CharterJ. This working group .in turn recommended that '"platform-level
working groups" be established. As a result, the Army Aviation AOAP
Enrollment/Disenrollment Working Group Charter was approved January 27, 2012. Under this
Working Group's methodology, a six-step process was established: (i) component PM initiates
component analysis and initial assessment; (ii) AMRDEC and AOAP Engineering Branch

                                                 14
perfonns supp011ing analysis; (iii) Worl-ing Group approves the report: (iv) component PM
fotwards recollllllendation to PM AOAP; (v) AOAP concurs/non-concurs and forwards to AMC
and Anny G-4; (vi) component PM implements changes to maintenance concept [TAB R.
Army Aviatio~ AOAP Enrollment/Disemollment Workiug Group Charter].

       Based upon this methodology, the Anny Aviation AOAP Enrollment/Disenrollment
Working Group sponsored the preparation of a report entitled "3 Micron Filter Engines (T700)
AOAP Component Evaluation Report'' This report is undated but the IO determined that is was
completed in January 2014. The report describes the T700's "Current Status in AOAP Pro11i-am''
as "Currently, the T700 engine is not being sampled." The report coucluded that oil analysis
sampling "is not recommended or required for the 1700 emzine." This conclusion wa based on
anal sis into the feasibilit of oil sam lin - e ..,


                                              e report a so cons1 re t e ocmnente pe onnance
of t e 3 nucron t1 tratton on t e T700 which "limits the recirculation ofpa1ticles detectable by
the [AOAP] and negates any potential value of AOAP testing for failure analysis," and therefore
•'negates the efJectiveness of AOAP as a diagnostic tool." The report recommended: that the
AOAP IPT approve the report; that PEO AVN send a foimal request to PM AOAP to formally
disenroll the T700 engine from AOAP sampling; that PM AOAP endorse and forward the
request tllfough USAMC' to Anny G-4, and that Anny G-4 advi6e the AAA of this decision.
[TAB N•lJ. Suppotting documents enclosed with the "3 Micron Filter Engines (T700) AOAP
Component Evaluation Report" include earlier Anny engineering assessments. in 2007 and
2008. that reached the same conclusion regarding efficacy of AOAP testing for the T700 engine.
These supporting documents also point out that the T700 series engine has an installed chip
detector that provides the aircraft pilot early warning: of impending pa11 failure allowing for
immediate landing of the aircraft. [TAB N-1].

       As a result of the Anny Aviation AOAP EnrollruentfDisenrollment Working Group's
assessment, Project Manager, Utility Helicopters signed a request to fonnally disenroll the T700
family of engines from the AOAP. This request was addressed thru Commander, LOGSA and
thrn Commander USAMC to Army G-4. It also was undated, but the IO detennined that it was
~igned 011 or about Febmary.'rvfarch 2014. [TABS}. This request. however, was never received
by Anny G-4. [TAB T and TAB U. Statement of Army G4 point of contacr for AOAP}.

        CONCLl'SION FOR ALLEGATION #1; Based on the above findings, the 10 reached
tbe following fmal conclusion with respect to Allegation #1:

       "Am1y leadership has not directed any member of Program Executive Office (PEO) -
       Aviation not to participate in the Anny Oil Analysis Program. nor failed to direct any
       membl!r of PEO Aviation to use test proce~ses offered by the A.OAP. Atmy publications
       associated with the AOAP maintenance procedures for the T700 aircraft engine reflect
       that the engine oil is not required to be sampled periodically. However, tbe
       administrative proces!i to exempt the T700 engiue from the AOAP is not compkte and
       requires the approval of the Army G4."

                                                 15
                          OSC Referred Allegation #2

 Whether the failure to employ AOAP resources has resulted in the gross waste of
approximately $95 million annually and has prevented AOAP from fully meeting its
                               mission objectives

        The Roi notes that the $95 million cost figure is discussed in the U.S. Oflice of Special
Counsel letter dated February 7, 2017 as follows: "The Whistleblower disclosed that in August
2014, AOAP was asked to participate in the Anny's Aviation and Missile Research,
Development, and Engineering Center (AMRDEC) Root Cause Working Group. One of
AOAP's responsibilities was to determine root causes and propose actions to address "no
evidence of failure" issues identified in T700 engines. AOAP found that the T-701O engine
represented $278,188,070 in Army Working Capital Fund purchases between March 2012 and
2013, with $95 million of that amount wasted each year due to preventable false positive chip
identification."

         Based on information provided by PM-AOAP, the IO determined that the actual source
of this cost data was the U.S. Army Aviation and Missile Command (AMCOM) Logistics
Center, Supportability and Sustainment Directorate (SSD), Sustainment Optimization and
Analysis (SOA) office document entitled "ALC-SOA Component Analysis Study T700-GE-
701D Engine", dated July l, 2013. This study did not recite a $95 million figure. That number
appears to have been derived as follows: Regarding the $278,188,070 figure, the study's
executive summary (at page 2 of the study) stated: "As such the T-701D engine represents the
largest total annual cost burden of any AMCOM-managed Class IX item with $278,188,070 in
total Army Working Capital Fund (ACWF)sales for a 12-month period (as of 15 March 2013).
The study went on to identify a number of cost drivers associated with the engine, most of which
are not germane to the Whistleblower's allegation. Section 6.4 of the study ("T-70 ID Tear
Down Analysis (RJMFIRE) Summary), beginning at page 58 of the study stated: "RIMFlRE isl.\
program that provides a failure reporting system through tear down evaluation (TOE) ... The
program identifies and quantifies failure causes of component returns to depot to determine
major drivers of equipment removals." Subsection 6.4.1 (at page 59) indicated that the most
prevalent category for return of engines to the depot is No Evidence of Failure ("NEOF"), with
the RIMFIRE process categorizing 55.15% of engine returns during the study period as NEOF.
Subsection 6.4.2- "T-701D NEOF Tear Down Evaluation Analysis" (beginning at page 63)
further broke down the NEOF category into four subcategories, including a category for
''Diagnostic - metal on magnetic plug" (page 64), which accounted for 33.4% of the NEOF
category. According to his interview statement, PM-AOAP believes the $95 million figure was
derived by multiplying $278,188,070 by that percentage. [TAB V and TAB WJ.

        The IO found that the product of that calculation actually approximates $93 million. He
went on to find that even H: for sake of discussion, the figure simply was rounded up to $95
million, he did not believe either amount accurately portrayed the information in the 20 l3 ALC-
SOA study, which again did not recite a $95 million figure or categorize such expenditures as


                                                16
"waste." As discussed below, the IO determined that the likely cost impacts were significantly
below this figure.

        For context, PM T700 provided the IO with the following explanation of the NEOF
categorization:

       "No Evidence of Failure"(NEOF) is defined as a category used to document the results of a
       component or system Teardown Evaluation when no evidence of any failure is found that satisfies
       the definition of a failure. Failure is a general term used to imply that a part in service has
       become completely inoperable, is still operable but is incapable of satisfactorily performing its
       intended function, or has deteriorated to the point that it is deemed unserviceable or unsafe for
       continued use, as detennined by existing aviation maintenance procedures. NEOF category is also
       used when the cause of failure cannot be determined. The NEOF findings can be categorized
       further into the following reasons for return to A WCF depot for rebuild:

    a. Precautionary Returns - Components or systems returned due to events that require the field to
       remove the item for inspection and overhaul. Examples are; Overtorque, Overspeed, Lightning
       Strike, etc.

    b. Diagnostic Returns with No Evidence of Failure (False Positives) - Removals caused by positive
       indications from diagnostics or condition/health indicators where no evidence of failure is found.

    c. Other Directed Removals - Removals required due to system upgrades, RECAP, etc.

    d. No Cause Found for Return - Tear down analysis' will be put into this subcategory when an
       engineering review of inspection results finds no evidence of failure and no other legitimate
       reason for return. Removals that have been returned for overhaul due to an error or
       misinterpretation also fall into this subcategory." [TAB P, Statement PEO AYN, Assistant
       Program Manager Utility. T700 Engine].

        PM T700 provided data indicating that the costs potentially associated with the NEOF-
Diagnostic Retum subcategory during the 2012-2013 timeframe were much lower than the $95M
figure alleged by the Whistleblower. The PM T700 data was obtained from a "2410 database,"
which records field-documented reasons for engine returns, and the RlMFIRE database along
with associated Engineering Review Board (ERB) records. Cost infonnation was obtained from
Army Working Capital Fund (A WCF) records. PM T700 informed the 10 that between March
2012 and March 2013:

       "51 T700 series engines were inducted into the depot for Metal on Magnetic Plug (MOMF)
       or chip light event based on the RIMFlRE database that were coded as 'No Evid_ence of
       Failure.• The circumstances for each of these engines (and all engines in the NEOF
       population) are reviewed by the ERB to further categorize/detennine whether there was
       legitimate cause for removal. The ERB judged that O of the SI engines in this timeframe
       were 'no cause' for return, and all 51 were diagnostic returns to the depot.

       A diagnostic return with No Evidence of Failure means that the removal of the engine was
       caused by positive indications from diagnostics or condition/health indicators where no
       evidence of failure is found." [TAB X].


                                                   17
       PM T700 reported that the AWCF net cost of one engine during this timeframe was
$476,085. [TAB P {Statement of PEO AYN. Assistant Program Manager UtHity, T700 Engine) and
TAD X]. Based upon this information, the 10 found that the cost of the 51 engines was
$24,280,335.

        With reference to the Whistleblower allegations, PM T700 provided further context
tor this figure as follows:

        "However, it is critical that the data extracted from these systems be used in the appropriate
        context when building business cases, and to be aware of the limitations of the data.

        For example, in the case of engines returned for MOMF (i.e., for a positive chip light
        identification):

        The field can pull an engine for a positive chip light, and by following the visual inspection
        (or optional lab analysis) procedures in the TM [Technical Manual], determine that the
        engine should be returned for the depot for non-allowable chip debris. The engine would
        likely be coded in the 2410 data based as MOMF for cause of removal by the field, and
        returned to depot.

       Upon induction, the engine would be tom down and inspected by the RIMFIRE team. If the
       chip debris is not returned with the engine (it is quite common for the chip debris to be wiped
       off/discarded prior to return) and no visual evidence at RIMFIRE inspection is present, then it
       would be categorized as No Evidence of Failure (NEOF) (Diagnostic Return), even though it
       was appropriately returned by the field. Furthermore, the depot never runs an engine across a
       test stand to re-create a failure mode or to test if the engine will produce non-allowable chips.
       This would be cost and time prohibitive.

        It should not be automatically assumed that all 51 of the engines in the NEOF-Diagnostic
        Return population would have been avoided by performing AOAP analysis techniques.
        Again, lack of visual evidence at depot induction does not mean it was an unnecessary return.

        To date, there has not been an example provided to [PM T700] illustrating that AOAP lab
        analysis techniques have identified that chip debris on an engine returned to the depot for
        MOMF contained allowable chips only, which would indicate that the engine could have
        remained in service. This would be a crucial step in substantiating the $9SM annual waste
        estimate. ln fact, the only examples provided by the AOAP PM have shown that chip
        detector technology confirmed visual inspection results (non-allowable MS0 debris), which
        required the engines to be returned to depot." [all emphasis in original] [TAB X; See also
        TAB EE. Statement of Program Management Analyst, Program Management Office,
        Aviation, Utility].

        In addition to the above 2012-2013 data, PM T700 provided the IO with data from other
time periods showing that only a small percentage of aircraft engi11es were categorized as either
NEOF-Diagnostic Return or NEOF-No Cause Found for Return upon post replacement
inspection. These two NEOF categories accounted for just 8% of the total RIM FIRE ERB
reasons for return for engines inducted from 2010-2015. In 2016, a total of226 engines were
returned to depot for al I causes. Extrapolating the 8% historical percentage to the 226 figure
                                                     18
would equate to 18 eng.iues that fall into the two NEOF subcategories that could indicate an
engine was rerumed as a false positive or without cause. The net AWCF cost of a T700 engine
in 2016 was $388.550, which under this methodology would result in a total cost impact of$6.9
million. [TAB P, Statement of PEO AVN. Assistant Program Manager Utility. T700 Engine].

         Finally. PM T700 informed the IO that from 20 IO to the present, only 2 I 8 engines
total have fallen under the definition ofNEOF, with "Metal on Mag PluE[" cited by the losing
unit as t.he reason for removal, a.ud only four of those were fo1md to meet the de.finition of
NEOF-No Cause Fouud for Retum when evaluated by the ERB. The associated net AWCF
cost impact is approximately $1.5 million. [TAB P, StatementofPEOAVN.AssiMantProgram
Manager Utility. T700 Engine].
       In addition to the above cost iufonnation, the IO made tile following find.in~ concerning
the Army's maintenance protocols when the T700 series engine's chip detector light comes 011
during engine operation:




                                                                  Once 1e wanung I t i
       1 ununate , aVIatiou mamtenance personne are requm: to follow very !>pecific procedures
       in order to confirm or deuy the presence of nu-allowable materials. If the engine continues to
       be operated with tl1e presence of un-allowable materials. catastrophic failw·e may occm·
       which would endanger the lives of the crewmembers and the ainvorthiness of the aircraft.
       The maintenance mnnual clearly states ·'Replace Engi11e" once an "m1-allowable material"
       situation exists. In addition. aviation maintenance manuals direct maintainers to use the test
       ~ O A P as requir..                       1'fir!l""lf;t!f1!!:emp·t-
       . . . . . . . . . . . ." [IO's finding as · on                 Y an TAB Z .
        Based on the above fmding:s the IO declined to characterize even the lesse1· dollar
amounts reflected in the PM T700 NEOF cost impact estimates a.s ''waste" in that the engines
were removed from aircrnft iu accordance with the Army's pub)jshed maintenance procedures
that are intended. among other things, to achieve aircrew safety, and in the absence of any
proven altematives to cmrent practices.

       C'ONCLl~SION FOR ALLEGATION #2: The IO reached the following final
conclusion with respect to Allegation #2:

       ··There is no evidence of a gross waste of $95 million annually associated with the T700
       engine. The costs associated with the NEOF characterization. both in the timeframe stated in
       the \Vhistleblower Complaint and more recently are significantly below the $95 million
       figure aJleged by tbe Whistleblower. Moreover. these engines were rerumed from the unit to
       the depot pursuant to Anny maintenance procedures designed to ensure peThonnel and aircraft
       safety; therefore. even rhe lower actual amounts associated with the NEOF characterization
       does not consritute "waste·· of Anny funds. In addition. the Ril\-!FIRE process itself does not

                                                   19
       associate a "No Evidence of Failure" with "waste" of government funds; rather NEOF is
       simply the term used when evidence of failure subsequently cannot be determined."

                            OSC Referred Allegation #3

            Whether T700 Office of Product Manager leadership refused to approve
                      funding for a chip analyzer for use by the AOAP

        With respect to this allegation, the 10 found as a thresho-Jd matter that Army budget
business practices are such that neither the Program Executive Office-Aviation, PM Utility
Helicopter Project Office nor the T700 Office of Product Manager could be in the funding
approval chain for PM-AOAP. Army funding approval is organizationally based. As discussed
in the Background section, PM-AOAP is assigned to HQ, Logistics Support Activity (LOGSA),
which in tum is assigned to U.S. Army Materiel Command (AMC). AMC reports directly to the
Department of the Anny (HQDA). Funding and budget activities have the same path. If PM-
AOAP has a requirement for funding, that organization must submit that requirement to LOGSA.
If LOG SA approves the requirement, that requirement will be forwarded to AMC for funding. lf
AMC approves the requirement, that requirement will be forwarded to HQDA for consideration.
PEO AVN is assigned to Assistant Secretary of the Army (Acquisition, Logistics and
Technology}, and is not in PM-AOAPs funding approval chain.

        More specifically, the IO found that the U.S. Army Aviation and Missile Research,
Development,. and Engineering Center (AMRDEC) sponsored a "Root Cause Working Group
(RCWG)" to further explore TI00-GE-701 D Metal on Magnetic Plug issue identified in the 2013
ALC-SOA study discussed above in connection with Allegation #2. In a preliminary report
dated October 7, 2014, the RCWG endorsed a data collection recommendation from PM-A OAP
as follows:

       "(4) The fourth data collection will be a lab analysis of debris from the chip detector. AOAP
       proposes employing Energy Dispersive X-Ray Pluorescence (EDXRF) technology to
       quantitatively determine the metallurgy of debris which accumulates filters, and chips which
       accumulate on chip detectors ... A feasibility study will be conducted to determine if it is cost
       effective to perform chip analysis at local units. Once a sufficient amount of data is
       collected. the 13-1 maintenance data, 24 IO maintenance data, and the chip analyses data from
       the OASIS database can be used to determine the effectiveness of the chip analyses in
       reducing NEOF engine removals." lTAB P, Statement of PEO AVN, Assistant Program
       Manager Utility, T700 Engine, Attachment 8].

       [n 2016, PM-AOAP submitted a funding request to the Aviation Army Working Capital
Fund (A WCF) managed by Army Aviation and Missile Command (AM COM), in order to
implement an aviation engine debris analysis pilot program for filter debris analysis. If
approved, A WCF would fund the pilot program and PMwAOAP would analyze the effectiveness
of Energy Dispersive X-Ray Florescence (EDXRF) technology on chips captured by the T700
engine's magnetic plug. The purpose of the pilot would be to determine whether the EDXRF
technology could replace existing visual inspection procedures. Although PM-AOAP submitted
the funding request, the pilot program would necessitate a change to T700 maintenance
procedures wherein unit maintainers would be instructed to submit chips for analysis. Since
                                               20
PEO A VN/PM T700 is responsible for approving any proposed change in engine maintenance
procedures, the AM COM A WCF manager instructed PM-A OAP to obtain PEO-A VN/PM
T700's endorsement the proposed pilot program. [TAB P (Statement of PEO A VN. Assistant
Program Manager Utility, T700 Engine); TAB AA; and TAB BB].

         PM-AOAP initially requested the endorsement from PEO AYN/PM, T700 in June 2016
and in a response that same month the Assistant PM, T700 Engines declined to endorse the pilot
program. The Assistant PM based her office's position on their assessment (i) "that the existing
oil filter already removes particles that AOAP would be targeting" and (ii) the absence of
"sufficient data to ensure this new technology has the required accuracy and provides substantive
results that will benefit the engine maintainers as well as reduce the number of engine removals
for debris that is not detrimental to safe engine operation." [TAB BB]. In October 2016, a
representative of PM-A OAP renewed its request for PM T700 endorsement of the pilot program.
After conducting further review of the matter PM T700 again declined to endorse the pilot based
on the aforementioned considerations. The ROI contains contemporaneous documentation of the
rationale for PM T700's position. fTAB P (Statement of PEO AVN, Assistant Program Manager
Utility, T700 Engine and her Attachment 10 MFR documenting the rationale); and TAB CC].
Without the endorsement of PEO-Aviation, the proposed chip analyzer pilot program was not
approved by the AM COM A WCF manager. [TAB P (Statement of PEO A VN, Assistant Program
Manager Utility, T700 Engine); TAB AA (Statement of Supportability and Sustainment
Directorate. AMCOM); TAB W; TAB FF, Statement of Lead Engineer, Army Research &
Development Command; and TAB GG, Statement of Support Operations Analyst. Supportability
and Sustainability Directorate, AMCOM ALC].

        In his statement to the IO PM-AOAP stated that he believes PMO T700's decision to not
endorse the pilot program was based on a lack of preliminary test data that would have illustrated
the potential benefits of the EDXRF technology, but he notes that his organization has not had
funding to accomplish such test and evaluation activity since 2011. He remains of the view that
adoption of this technology would improve maintenance practices. [TAR WJ. In June 2017, a
representative of PM-A OAP renewed its request that PM T700 endorse the pilot program via an
email to the Assistant PM that included supporting information. [TAB CC].

       CONCLUSION FOR ALLEGATION #3: Based upon the above findings, the IO
reached the following conclusion:

       "The T700 Office of Product Manager leadership are not in the funding approval chain for
       PM-AOAP, so could not refuse to approve any .PM-AOAP request for funding. 1lowever,
       PEO-Aviation, Assistant PM, T700 Engines declined to endorse a proposal to conduct an
       A WCF pilot program due to the cost not being included in the request and the lack of
       research data that indicates that the EDXRF technology would successfully prevent the
       unnecessary return of a serviceable engine to the depot for overhaul. The lack of this
       endorsement stopped the proposal. While it is readily apparent that a professional difference
       ofopinion exists between PM-AOAP and PMO T700 concerning the efficacy of the proposed
       pilot program, PMO T700's disposition of PM-AOAP's request, in no way constitutes a
       violation oflaw, rule, or regulation; gross mismanagement; or a gross waste of funds."


                                                  21
        As discussed below in the next section, the IO made a recommendation consistent
with this conclusion.




     INVESTIGATING OFFICER'S RECOMMENDATIONS
      Based upon his findings and conclusion, the 10 made the following two
recommendations to the Investigation Appointing/Approving Authority:

       I. "Recommend that the PM-AOAP officially staff the Anny Aviation AOAP
       Enrollment/Disenrollment Working Group recommendation to exempt the T700
       aircraft engine from the AOAP through HQ, LOG SA, USAMC, 03/5/7 and the Army
       G4 for official approval. This action will complete the administrative process in
       order to exempt the T700 aircraft engine from the AOAP."

       2. "lt is clear that procedural and critical content issues prevented the approval and
       funding of the PM-AOAP proposal to analyze the effectiveness of Energy Dispersive
       X-Ray Florescence (EDXRF) technology. Not unlike all US Army systems
       managers, PM-A OAP has the responsibility to monitor any and all emerging
       technologies in order for the Anny to keep pace with the industry and the support of
       systems that combat emerging threats across the globe. PM-A OAP in good faith,
       attempted to do just that without success. Nonetheless, in recognition of the
       previously-discussed 2013 ALC-SOA study and the 2014 Root Cause Working
       Group preliminary report that documented the NEOF issue, and in order to ensure
      .that the Army is taking advantage of the best technology in this area, recommend that
       USAMC; LOGSA, PEO-Aviation and PM-AOAP reopen consideration of the pilot
       program and seriously consider funding the proposal to analyze the effectiveness of
       Energy Dispersive X-Ray Florescence (EDXRF) technology in support of the safety
       of Army aircraft and their crews.';

        The Investigation Appointing/Approving Authority concurred in both recommendations
in conjunction with his approval of the RoL By memorandum dated October 4, 2017, he
directed PEO A VN to take the following actions:

       "I. Re-initiate staffing of the Army Aviation AOAP Enrollment/ Discnrollment Working
       Group recommendation to exempt the T700 aircraft engine from the AOAP, originally
       initiated by your office in 2014, through Program Manager (PM)- AOAP, through
       Headquarters, U.S . Army Logistics Support Activity (LOGSA), and through
       Headqua1ters U.S. Army Materiel Command (USAMC) Deputy Chief of Staff G-3/5/7,
       to Headquarters, Department of the Army Deputy Chief of Staff, G-4 for official
       consideration/approval. This action is intended to complete the administrative process
       prescribed in Army Regulation 750-1 to exempt the T700 aircraft engine from the AOAP.
       Submit the recommendation package to PM-AO AP no later than October 31, 2017, and
       closely monitor its status until Army G-4 completes disposition. Report final disposition
       to the ASA (ALT) Chief of Staff.
                                               22
2. In recognition of studies that have identified incidences of T700 engines returned to
depot based on chip light indications and subsequently assessed as "No Evidence of
Failure," and in order to ensure that the Army is taking advantage of the best technology
in the arena, reopen consideration of the pilot program recommended by PM-AO AP to
analyze the effectiveness of Energy Dispersive X-ray Florescence {EDXRF) technology
in support of the safety of Am1y aircraft and their crews. Working in coordination with
PM-AOAP, LOGSA, and USAMC, determine whether PEO AVN should endorse the
pilot program, and approve associated changes maintenance protocols, in support of a
resourcing decision by USAMC. Report the disposition of the reconsideration to the ASA
    n
(AL Chief of Staff, no later than November 30, 2017. ln the event you determine that
endorsement of the pilot program is not warranted, no later than November 30, 2017
provide the ASA (ALT) Chief of Staff with a memorandum under your signature that
fully explains the basis for that determination." [TAB DD}.




                                        23
                                       CONCLUSION


        The Department of the Army· takes very seriously i.t;-; responsibility to address, in a timely
and thorough fashion. matters refened by OSC. In this case, the Army conducted a thorough and
comprehensive investigation in response to the OSC's referral of allegations submitted by the
anonymous Whistle blower. An Investigating Officer was appointed to investigate the facts and
circumstances surrounding the Whistleblower's allegations that the Army had failed to employ
the state-of-the art technology offered by the AOAP at the Army's Utility Helicopters Project
Office, Redstone, Arsenal, Alabama. The purpose of this investigation was to determine the
validity of the WhistJeblower's allegations and make findings concerning whether any
wrongdoing had occurred, and if so, by whom, and whether adequate policies and procedures are
in place to preclude any recurrences of any improprieties, irregularities, or misconduct. Further,
appropriate corrective actions were to be taken as required. These allegations demanded that the .
investigation leave no stone unturned.

        Although, the Army's investigation concluded that none of the Whistleblower's
allegations were substantiated, the IO did identify that the Army failed to follow its internal
administrative procedures for exempting the TIOO engine from the AOAP. The Army has
initiated corrective actions to rectify that omission. The IO also concluded that while it would be
inaccurate to characterize PM, T700's refusal to endorse PM, AOAP's pilot program initiative as
improper, the 10 did recommend that the initiative be reconsidered in order to ensure that the
Army is taking advantage of the best available technology in this area. I agree with the IO's
conclusion that PM, T700's position concerning PM, AOAP's pilot initiative represented a
professional difference of opinion between the two offices and did not constitute a violation of
law, rule, or regulation, gross mismanagement, or a gross waste of funds. In response to the IO's
recommendation, the Army has initiated steps to ensure that the recommended reconsideration
occurs and that its outcome is fully documented.

        I am satisfied that the IO's conclusions and implementation of the associated
recommendations constitute an appropriate outcome in this matter. Accordingly the Army has
made no refen·al of alleged criminal violation to the Attorney General pursuant to Title 5, United
States Code,§ 1213{d)(5)(d).

       Th.is report, with enclosures, is submitted in satisfaction of my responsibilities under Title
5, USC, Sections 1213(c) and (<l). Please direct any further questions you may have concerning
lhis matter to Ms. Cassandra Tsintolas Johnson, at 703-614-3500.

                                               Sincerely,


                                                ./
                                               Raymond T. Horoho
                                               Acting Secretary of the Anny
                                                 ·(Manpower and Reserve Affairs)
                                                 24
                     Army Oil Analysis Program
                      Redstone Arsenal, Alabama
       Office of Special Counsel File Number DI-15--5616

          Description

TABA      Secretary of the Army (SA) delegation to the Assistant Secretary of the Army
          (Manpower & Reserve Affairs) his authority, as agency head, to review, sign, and
          submit to Office of Special Counsel the report required by Title 5, USC, Sections
          1213(b), (c), and (d), dated May 2, 2017

TABB      OSC referral dated February 7, 2017, to the Acting Secretary of the Army
          requesting he Investigate allegations of violations of law, rule, or regulation; gross
          mismanagement; and a gross waste of funds at Army's Utility Helicopters Project
          Management Office, Redstone, Arsenal, Alabama

TABC      Acting Secretary of the Army Memorandum, February 28, 2017, Subject:
          Whistleblower Investigation-Failure of Anny Employees to employ state-of-the
          art technology by the Army Oil Analysis Program (AOAP) - (Office of the
          Special Counsel File Number DI-15-5616, forwarding the OSC referral to the
          Acting Assistant Secretary of the Anny (Acquisition, Logistics and Technology)

TABD      Memorandum for Investigating Officer, Headquarters, Department of the Army,
          Office of the Deputy Chief of Staff G-4, March 14, 2017, Subject: Appointment
          of Investigating Officer - Whistleblower Investigation-Failure of Army
          Employees to Employ State-of-the-Art Technology Offered by the Army Oil
          Analysis Program at Redstone Arsenal, Alabama

TABE      Army Regulation 10-87, Army Commands, Army Service Component
          Commands, and Direct Reporting Units

TABF      Memorandum, Subject: Department of the Army, Oil Analysis Program (AOAP),
          Program Manager (PM) Charter, August 1, 2008, Approved by Lieutenant
          General Mitchell H. Stevenson,, U.S. Army, Deputy Chief of Staff, G-4


TABG      General Orders No. 2017-01, Assignment of Functions and Responsibilities
          Within Headquarters, Department of the Anny, January 5, 2017[PH1J


                                            1
TABH   10 United States Code 2208, Working-capital funds

TABI   Assistant Secretary of the Army/Financial Management & Comptroller A WCF
       Resource Manager's Cowse Material (Source-Anny G-4 AWCF Subject Matter
       Expert)

TABJ   Extracts from Army Regulation 750-1, Army Materiel Maintenance Policy, dated
       September 12, 2013

TABK   Army Regulation 700-132-Joint Oil Analysis Program, March 26, 2014

TABL   L-1 - Technical Bulletin 43-0211, Army Oil Analysis Program (AOAP), Guide
       for Leaders and Users, dated December 1, 2004, including Appendix A

       L-2-Technical Bulletin 43-0211, Appendix A

TABM   PM AOAP emails dated August 16 & 18, 2017 (Response to specific questions by
       Investigating Officer addressing the Whistleblower's allegations)

TABN   N-1-Complete 3 Micron Filter Engines (T700), AOAP Component Evaluation
       Report

       N-2 Extract from 3 Micron Filter Engines (T700), AOAP Component Evaluation
       Report, dated January 29, 1985

TABO   U.S. Army Audit Agency Report - Follow up Audit of Army Oil Analysis
       Program - Restructure Plan, Redstone Arsenal, Alabama September 24, 2007

TABP   PEO AVN, Assistant Program M~nager Utility, T700 Engine (with 10
       attachments)
       Attachment I-Memorandum, Subject; Department of the Army, Oil Analysis
       Program (AOAP), Program Manager (PM) Charter, dated August 1, 2008

       Attachment 2-Memorandum, Subject: Aviation Component Disenrollment from
       Army Oil Analysis Program (AOAP), dated June 9, 2008

       Attachment 3-Point Paper, Subject: Army oil Analysis Program (AOAP) Status,
       dated May 21, 2012

       Attachment 4-Memorandum, Subject: MH-60M Helicopter Category I Deficiency
       Report (DR) MI3H90308 on YT706-GE-700 Turboshaft Engine, P.N
       5130T37G01, SIN GE-E-341010

       Attachment 5-Email, Subject: FW: AOAP lab analysis of YT706 debris, dated
       July 7, 2016, From: Technical Chief, T700, To: Assistant Project Manager 1700

       Attachment 6-Email, Subject: ESN 341010 Chips, dated May 28, 2013, From:
       Senior Product Support Engineer Military Systems OP, GE Aviation, To:
       Aerospace Engineer, U.S. Anny.


                                      2
         Attachment ?-Memorandum, Subject: Chip Detector Debris Analysis (TN
         163684), dated August 23, 2016
         Attachment 8- AH-64 and Blackhawk: H-60, Root Cause Working Group
         Preliminary Report (TI00-GE-701D Metal on Magnetic Plug), dated October 7,
         2014

         Attachment 9-Email, Subject: RE: A WCF synopsis, dated June 28, 2016, From
         Assistant Project Manager T700, To: LOGSA, AOAP, General Engineer

         Attachment 10-Memorandum for Record, Subject: T700 Chip detector debris
         analysis, dated November 3, 2016

TABQ     Army Aviation Oil Analysis Integrated Project Team Charter, Between Office of
         the Deputy Chief of Staff, G-4; US Anny Materiel Command, G-3/S; AMRDEC,
         Aviation Engineering Directorate; and Program Executive Office, Aviation,
         signed 2009/2010

TABR     Army Aviation AOAP Enrollment/Disenrollment Working Group Charter, dated
         January 27, 2012

TABS     Program Executive Office (PEO), Aviation (A VN), Utility Helicopter Project
         Office Memorandum, Subject: Adjustment of Army Oil Analysis Program
         (AOAP) Sampling for T700 Engines, undated

TABT     Email From Army G4 point of contact for AOAP, Subject: RE: T700 AOAP
         Exempt, to IO, dated August 15, 2017 (email confirmation that the dis-enroll
         request for the TI0O was not formerly staffed in order to gain Army G4 approval)

TABU     Statement of Army G4 point of contact for AOAP

TABV     ALC-SOA Component Analysis Study T700-GE-70 ID Engine, dated July 1,
         2013
TABW     Emails from PM AOP dated August 16 & 18, 2017 to IO (Responses to specific
         questions addressing the Whistleblower's allegations)

TABX     Memorandum, Subject: Response to Email: T700 oil filter specifications and post
         chip light maintenance steps/procedures, dated 2 June 2017, dated June 5, 2017
         (Response provides 2012 T700 Engine Financial Data)

TABY     3 Micron T700 Engine Oil Filter Specifications (Exhibit 12)

TabZ     Excerpts from Technical Manual (TM) 1-2840-248-23 & P-1, Aviation Unit and
         Intermediate Maintenance Engine, Aircraft Turboshaft (TI00-GE-700) (T700-
         GE-70 l C) (T700-GE-701D) EiC: NIA, Electrical Chip Detector Light on During
         Engine Operation

TAB AA   Statement of Supportability and Sustainment Directorate, AMCOM


                                         3
TAB BB     Email communication between PEO AYN, Assistant Program Manager Utility,
           T700 Engine and LOGS A, AOAP, General Engineer, dated June 28, 2016
TAB CC     Email from Chief, TI00 Senior Supervisor Logistics Division, AMCOM, Subject:
           RE: T700 Cost Data Sent to Assistant Program Manager Utility, T700, dated
           August 18., 2017 (Response to specific questions by IO addressing the origin of
           cost data provided by Assistan1 Program Manager Utility, T700)

TABDD      Memorandum, Subject: Implementation of Army Regulation 15-6
           Recommendations - Whistleblower Investigation Concerning Failure of Army
           Employees to Employ State-of-the-Art Technology Offered by lhe Anny Oil
           Analysis Program (AOAP) at Redstone arsenal, Alabama, dated October 4, 2017

TAB EE     Statement of Program Management Analyst, Program Management Office, Aviation,
           Utility

TAB FF     Statement of Lead Engineer, Army Research & Development Command

TABGG      Statement of Support Operations Analyst, Supportability and Sustainability
           Directorate, AMCOM ALC

TAB HI-I   Statement of PEO A VN. Program Manager Utility Helicopters, Program
           Executive Office, Aviation, Utility

TAB II     Statement of Project Manager Apache Attack Helicopter, Program Executive
           Office, Aviation, Utility

TABJJ      Statement of Program Manager, Anny Oil Analysis Program, Logistics Support
           Activity, US Anny Materiel Command




                                            4