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NSIAD-86-5 1 (1985-10-28)

handle is hein.gao/gaobabfkd0001 and id is 1 raw text is: BY THE U,S, GENERAL ACCOUNTING OFFICE Report To The Chairman, Subcommittee On Defense, Committee On Appropriations, House Of Representatives An Assessment Of The Army's Multiple Launch Rocket System Multiyear Contract The DOD Authorizations Act, 1982 (Public Law 97-86) authorized multi- year contracting of major DOD weapon systems to reduce procurement costs and to broaden the defense industrial base. One of the first multiyear contracts approved by the Congress after enactment of Public Law 97-86 was for the Army's Multiple Launch Rocket System (MLRS). The Army justified the $1.7 billion multiyear contract claiming $209.1 million savings and improvements in the industrial base. This report presents (1) an assessment of the supportability of the Army's claimed savings, (2) industry views on whether the contract will broaden the industrial base, and (3) an evaluation of the extent to which the contract complies with applicable provisions of Public Law 97-86. GAO found support for estimated budgetary savings to the Army of $166.8 million of its $209.1 million estimated savings for advance material purchases. In present value terms, the $209.1 million is a savings of about $67.7 million. Though MLRS contractors told GAO that they increased investments, retained skilled employees, had better training programs, and enhanced mobilization preparedness, GAO had no baseline from which to measure improvements nor does GAO know the extent to which these benefits might also have been possible under annual contracts. z7i 128339 GAO/NSIAD-86-5 OCTOBER 28, 1985