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Public Statements

National Defense Authorization Act for Fiscal Year 2007

By:
Date:
Location: Washington, DC


NATIONAL DEFENSE AUTHORIZATION ACT FOR FISCAL YEAR 2007 -- (Senate - June 22, 2006)

BREAK IN TRANSCRIPT

Mr. COBURN. Mr. President, I thank the Senator.

I want to spend a few minutes, first of all, praising the chairman and ranking member of this committee. It is important, I think, that we see the relationships that develop, as well as the standards that have been developed on this bill, the fact that Chairman Warner was here very late last night, the fact that we are moving forward in an expeditious way.

I have several areas and several amendments I am going to call up. I will try to be cooperative as to whether we have votes. But I think the issues are important enough that the American people ought to hear the debate about them.

I am not under any illusion that will necessarily win some of them. But I think we need to pay attention to them and the debate needs to be a part of the RECORD.

With that, I call up amendment No. 4454 and ask unanimous consent to modify it with the language of 4491, which I have here in my hand.

The PRESIDING OFFICER. Is there objection to the modification?

Mr. WARNER. Mr. President, is it possible for the managers to look at this for a moment before it is sent up? I think it would help facilitate matters.

Mr. President, I suggest the absence of a quorum.

The PRESIDING OFFICER. The clerk will call the roll.

The bill clerk proceeded to call the roll.

Mr. COBURN. Mr. President, I ask unanimous consent that the order for the quorum call be dispensed with.

The PRESIDING OFFICER. Without objection, it is so ordered.

AMENDMENT NO. 4491, AS MODIFIED

Mr. COBURN. Mr. President, I call up amendment No. 4491, as modified, and I ask unanimous consent to make it a first-degree amendment.

The PRESIDING OFFICER. Is there objection? Without objection, it is so ordered.

The amendment (No. 4491), as modified, is as follows:

At the appropriate place insert the following:

SEC. __


. REFORMS TO THE DEFENSE TRAVEL SYSTEM TO A FEE-FOR-USE-OF-SERVICE SYSTEM.

No later than one year after the enactment of this Act, the Secretary of Defense may not obligate or expend any funds related to the Defense Travel System except those funds obtained through a one-time, fixed price service fee per DOD customer utilizing the system with an additional fixed fee for each transaction.

Mr. COBURN. Mr. President, this is a great case for the American people to see what is not operating right in many of the branches of our Government.

There is a procurement contract that started out 8 years ago. The total cost was to be $200 million. The idea was to save money on purchasing travel vouchers for our military. That was the goal. The original cost was $246 million. We are now 8 years into this, and we are over $464 million. It is working at a 30-percent level. It was working at less than 10 percent last year. Even though we have the GAO saying they may have saved $13 million this year, the fact is that study didn't consider the fact that the vast majority of time when they buy an airplane ticket they do not get the best price. So that wasn't even considered. The purpose of this amendment is to cause us to focus again on what we are doing.

There are no-bid contracts, contracts that change in terms of violation of the contracting laws, performance bonuses, pay for back costs, negotiating through the procurement procedure. There is no significant oversight in this Congress on procurement in the agencies of this Government. That has to change. Nobody in the private world would get away with this. Nobody in their personal life would be able to get away with this.

Yet we have a system now where almost every ticket that is bought through this $464 million program still has to be checked by a travel agent, of which we pay anywhere from $5 to $11 an hour, even though we might have saved $20 on a payment system through the Pentagon.

What is the problem? I have worked with the comptroller at the Pentagon. They were aware of this. The Secretary of Defense is aware of it. The chairman is aware of the problem. The ranking member and I have had multiple discussions.

The problem is the Pentagon has hundreds of computers that won't talk to each other. Instead of fixing that problem, we contract to make a system that should be off the shelf for less than $59 million, and we pay $500 million for it so it will speak to all these different programs--and it is not doing it effectively.

The purpose of this amendment is to quit sending good money after bad and say don't get rid of the program, but let us incentivize the program. If it is a good program, then let us pay the contractor every time it is used. If it is not used enough, and if it doesn't get used--and it is not getting used now because it is too hard to use in the vast majority of the cases, most people go straight to a travel agent--let us pay them on a per-transaction basis just like this contractor has on every other travel program that it has with the Federal Government.

Why would we do it differently in the Pentagon? We are doing it differently because our procurement system is broken in terms of how we hold people accountable.

I have nothing against the contractor.

If you would let me continue to do a program and not perform and continue to give me money, I will take it. But what it is doing is breeding incompetency. It is wasting taxpayer dollars, and we ought to say there is a point in time.

What do we know about travel systems in the Federal Government? What we know is in five other agencies they don't have any problems at all, two of which were developed by their same contractor.

Why are we having problems here? One of them is because we have a cost-plus contract. What is the incentive to fix the problem? There is not any because it is going to continue to be renewed.

This amendment says very simply change the incentive. If this is a good program--Oh, I know. This doesn't say throw the money out or throw the program out.

It says, change the program to incentivize it to be operational. It is in less than 30 percent of our military bases now. It is still not used. The one place it has been used is one Air Force base where it was mandated by the commander: You will use this system.

Do you know what the utilization rate is? Ninety percent. And the cost in terms of getting it done is about three times the benefit in terms of savings for paying for the bill.

On that same Air Force base, over 50 percent of the time they never get the cheapest fare, so what we save in terms of paying--the actual accounting work within the Pentagon, which I agree is a worthy goal--we lose because the system does not find the best fare.

As a matter of fact, most Pentagon employees would be better off to go to Travelocity or Orbitz, buy their own ticket on their own dime, get reimbursed, and the Pentagon can do it cheaper than with this.

This is a very straightforward amendment. It says don't get rid of the defense travel system, keep it going, but fund it on a per-transaction basis that says if this is good for the Pentagon, then use it and we will pay for it. That incentivizes the contractor to make it easy, to make it useful, and to get our value for it. Isn't half a billion enough to pay for a travel system that you could have bought off the shelf for $50 million? It reflects on what we have as problems within the Pentagon.

Let me touch on that. I am a supporter of the Pentagon. I am a supporter of our Defense Secretary. He has told me this is one of the areas where they have great problems. Last year, the Pentagon paid $6 billion in performance bonuses to contractors who did not meet their performance requirements. Think about that for a minute. That means if you are told where you work: If you meet a certain expectation you are going to get a bonus, except we will pay you even if you do not meet that expectation--what are you going to think next year? You are going to think: I don't have to meet the expectation because I am going to get paid.

That is exactly what is happening within our contracting within the Pentagon and several other agencies within the Federal Government.

I ask the chairman and the ranking member to consider this. I believe it is a way to straighten out a contract and also send a signal. At best, we are going to have a $350 billion deficit this year. Should we spend our kids' and grandkids' money in an inefficient way? This is a good message we ought to send so other contractors see it. You will not get a cost-plus contract if you do not perform, and you are not going to continue to have contracts renewed.

There are a lot of other details, and I ask unanimous consent to have them printed in the RECORD.

BREAK IN TRANSCRIPT

Mr. COBURN. There were violations in contracting law with this. There were promises made last year when we had this same discussion in the Senate that certain things were happening that did not happen in terms of this contract. There is no question there has been some improvement, but they have not achieved a level that would say we are anywhere close to the level of making this an efficient system.

Mr. WARNER. If I can address the Senator with regard to this amendment, it is an amendment the Senate has visited before.

I would like to have the Senator's observation of whether my information is correct. The Senator has been at this 2 years. I commend the Senator for that work. As a consequence of that work, the Department has done some things, have they not?

Mr. COBURN. They have.

Mr. WARNER. It has been told to me that 95 percent of the Senator's goals have been achieved and that by October 1 of this year, it will be 100 percent.

Mr. COBURN. The actual numbers on utilization of this system, if the Senator can bear with me for a minute, the utilization rate right now is 30 percent in the military. In other words, 3 out of 10 facilities that purchase travel are utilizing this. If that is what we wanted when we contracted it, great. But that is not what was in the contract.

This same contractor, by the way, had a system developed through the Department of Transportation 6 months ago that is working just fine.

I portend that proves the problem with the system is the contracting, not the contractor. We ought to send a signal. Say it is 90 percent, if that is the case, they will make more money doing it on a per-transaction basis than they would under a contract basis.

Mr. WARNER. Mr. President, my friend is an expert on this, and I freely admit I am not.

Mr. COBURN. I am not an expert, but I don't like waste. I think we have wasted money.

Mr. WARNER. It is represented to me the DTS, the defense system is not merely a travel booking system, but it has much broader functionality than any of the Federal Government e-travel systems. In short, DTS is an end-to-end accounting system that automatically handles the entire range of otherwise very expensive and time-consuming manual tasks associated with DOD travel.

Any fair comparison has to begin with the fact that DTS offers an end-to-end travel management capability that incorporates military entitlements and DOD travel policies, and e-travel services simply do not.

Mr. COBURN. Early in my statement I made this point: We are fixing the wrong problem. The problem is the computer system. The reason this is so expensive, the computer systems in the Pentagon do not talk to one another. We have designed a monstrous computer system to make it talk to all these systems that will not talk to one another rather than to fix the computer system in the Pentagon to make them talk to one another.

If we do that on every project that we need to enhance and overfill for the Pentagon, we are going to get into the same problem. They make all their money by being able to pay the bill. But it is a travel system.

If they make efficiency in terms of being able to pay the bill--which is the problem the Pentagon was having--we ought to also expect them to get the fares right and not have to pay another $6 to a travel agent for every ticket they write, to doublecheck to see if the system was right. That is what is happening.

When you say 90 percent, that is 90 percent, plus we are having the travel agents check it. It is not an automated system.

Have they made improvements? Yes, I do not deny that. But if they are where they need to be, and if their contract as originally specified and modified, if they are at 90 percent, they will make a ton more money on a per-transaction basis, and we will get what we need and they will get what they need.

But they are not. That is why we have the resistance to a transaction basis. You cannot have it both ways. If they are at 90 percent, any prudent businessman would say: Sure, we want it on a transaction basis. If they are not at 90 percent, if they are at 30 percent, as I propose they are, and inefficiently at 30 percent, the reason they want a contract through next year is because they are going to make a lot more money than they would on the transaction basis.

Mr. WARNER. Mr. President, I continue to be very depressed by the knowledge that this Senator has on the subject. I freely admit that I do not have the depth of knowledge.

I understand initially the amendment called for a study. Then, as provided under the rules of the Senate, the Senator modified the amendment, and it is now a very specific piece of legislation that I am advised could well end the program.

Somewhere between a study and trying to end the program, should the Senator prevail, there must be a basis on which we can have an accommodation so I can accept some measure to meet the Senator's goals and incorporate it in the bill, assuming my distinguished ranking member will accept my recommendation.

Mr. President, why doesn't the Senator go to his next amendment? In the meantime staff can go to work.

Mr. COBURN. I will gladly do that, and I am happy to work with you.

I make a final point. Supposedly, this contract is going to be out for bid at the end of this year. It was supposed to have been out for bid last year. They renewed the contract without putting it out for bid, so I don't have any hope it will go out, first.

And, No. 2, nobody is going to bid on this. It is a mess. Nobody is going to bid on it. The only person you will have bid on it is the original contractor. Whether that is accurate or not, I am willing to work with the chairman to bring down the costs.

The fact is, the real problem is the computer systems in the Pentagon. We all know that. The Senator is aware of it, the ranking member is aware of it. The comptroller is working hard to change that. That is a 4- to 7-year program that we have embarked on which everyone knows has to happen.

Here is my worry: I will be back here next year doing the same thing because it is still not going to work. That is my worry. That is not fair to our grandkids.

BREAK IN TRANSCRIPT

AMENDMENT NO. 4370

Mr. COBURN. Mr. President, I ask unanimous consent that the pending amendment be set aside and that amendment No. 4370 be called up.

BREAK IN TRANSCRIPT

The Senator from Oklahoma [Mr. COBURN] proposes an amendment numbered 4370.

Mr. COBURN. Mr. President, I ask unanimous consent that the reading of the amendment be dispensed with.

The PRESIDING OFFICER. Without objection, it is so ordered.

The amendment is as follows:
(Purpose: To require notice to Congress and the public on earmarks of funds available to the Department of Defense)

At the end of subtitle A of title X, add the following:

SEC. 1008. REPORTS TO CONGRESS AND NOTICE TO PUBLIC ON EARMARKS IN FUNDS AVAILABLE TO THE DEPARTMENT OF DEFENSE.

(a) Annual Report and Notice Required.--The Secretary of Defense shall submit to Congress, and post on the Internet website of the Department of Defense available to the public, each year information as follows:

(1) A description of each earmark of funds made available to the Department of Defense for the previous fiscal year, including the location (by city, State, country, and congressional district if relevant) in which the earmarked funds are to be utilized, the purpose of such earmark (if known), and the recipient of such earmark.

(2) The total cost of administering each such earmark including the amount of such earmark, staff time, administrative expenses, and other costs.

(3) The total cost of administering all such earmarks.

(4) An assessment of the utility of each such earmark in meeting the goals of the Department, set forth using a rating system as follows:

(A) A for an earmark that directly advances the primary goals of the Department or an agency, element, or component of the Department.

(B) B for an earmark that advances many of the primary goals of the Department or an agency, element, or component of the Department.

(C) C for an earmark that may advance some of the primary goals of the Department or an agency, element, or component of the Department.

(D) D for an earmark that cannot be demonstrated as being cost-effective in advancing the primary goals of the Department or any agency, element, or component of the Department.

(E) F for an earmark that distracts from or otherwise impedes that capacity of the Department to meet the primary goals of the Department.

(b) Earmark Defined.--In this section, the term ``earmark'' means a provision of law, or a directive contained within a joint explanatory statement or report accompanying a conference report or bill (as applicable), that specifies the identity of an entity, program, project, or service, including a defense system, to receive assistance not requested by the President and the amount of the assistance to be so received.

Mr. COBURN. Mr. President, this is an amendment that is going to have some emotion with it. I want to talk about it first. There is no question when it comes to the wisdom of many of the Members of our body that directing the Pentagon to do certain things is valuable. We know that from anecdotal experience. But what we don't know is how many times we have told them to do something that has been a complete waste. What I am talking about are earmarks in the Defense authorization bill as well as in the Defense appropriations bill.

There is a wonderful body of knowledge, plus an institutional knowledge, here that helps give wisdom to direct the Armed Services. I believe we ought to be in that position. What this amendment does is ask for a report. I want to explain, for a second--and I want the American public to see--what has happened in terms of earmarks.

In 1994, there were $4.2 billion worth of earmarks in the Defense appropriations bill. Last year, there were $9.4 billion. The question we should be asking is not whether or not there should be earmarks, but what is the result of those earmarks? What is the consequence of the earmarks? Not only were the numbers up, the dollars up, but the numbers have skyrocketed.

So the question which I think would be prudent for us to ask is, No. 1: Earmarks are consuming a larger percentage of defense dollars. They also, according to Pentagon reports and some Members of this body, are taking money away from other priorities that are deemed to be higher a lot of the time. They also account for some of the problems we are having in the emergency supplementals and adding to the rising cost of our debt. Many times they are not needed, but, in fact, they are associated with benefiting a region or an industry that is not necessarily in the highest priority.

So this is not about eliminating earmarks. This is about looking at earmarks and saying: What are we getting for them? Where are they working great for us? Where are they not working? Are they beneficial to the defense of this country? Is it something that gives us a benefit?

The other thing I would remind us of is, in the most recent history we have seen an ethical lapse in association with some earmarks, and we have actually seen some criminal behavior in association with earmarks. That ought to be a part of the report as well.

So the whole idea is to add transparency and accountability to earmarks. Let's look at them. What are we getting for them? What are we losing? What are the opportunity costs that are lost because we have them there? The total annual cost of earmarks in Defense appropriations bills would be put in this report.

We can determine the actual numbers of earmarks and the actual price tags. But we don't know the hidden costs of those earmarks, which include staff time and administration. And we don't know the opportunity cost of those earmarks: What did not happen for our soldiers, what did not happen in terms of procurement because we put in something else of maybe a lesser priority?

The annual report will provide Congress and the public a more complete understanding of the total cost of the earmarks to the Department of Defense, the purpose and location of each earmark, and an analysis of the usefulness of each earmark in advancing the goals of the Department of Defense. This will provide Members of Congress a more complete view of the cost-effectiveness of each project and whether those projects warrant continued funding.

The last amendment we were on started as an earmark. I remind the Members of this body, it started at $200 million, and now will have grown to over $500 million in initiatives and earmarks, but we did not have the benefit of a report such as this to see if we were getting value for this money.

This is a simple amendment. It is not going after earmarks. It is not saying they are bad. It is not saying they are good. What it is saying is: Shouldn't this body know? Shouldn't we know the impact, positively and negatively? Shouldn't we know the lost opportunity cost?

I hope both the ranking member and the chairman of this committee will give this amendment consideration. And I ask for their response.

BREAK IN TRANSCRIPT

AMENDMENT NO. 4370

Mr. COBURN. Mr. President, I ask unanimous consent that the pending amendment be set aside and that amendment No. 4370 be called up.

BREAK IN TRANSCRIPT

Mr. COBURN. Mr. President, I ask unanimous consent that the reading of the amendment be dispensed with.

The PRESIDING OFFICER. Without objection, it is so ordered.

The amendment is as follows:
(Purpose: To require notice to Congress and the public on earmarks of funds available to the Department of Defense)

At the end of subtitle A of title X, add the following:

SEC. 1008. REPORTS TO CONGRESS AND NOTICE TO PUBLIC ON EARMARKS IN FUNDS AVAILABLE TO THE DEPARTMENT OF DEFENSE.

(a) Annual Report and Notice Required.--The Secretary of Defense shall submit to Congress, and post on the Internet website of the Department of Defense available to the public, each year information as follows:

(1) A description of each earmark of funds made available to the Department of Defense for the previous fiscal year, including the location (by city, State, country, and congressional district if relevant) in which the earmarked funds are to be utilized, the purpose of such earmark (if known), and the recipient of such earmark.

(2) The total cost of administering each such earmark including the amount of such earmark, staff time, administrative expenses, and other costs.

(3) The total cost of administering all such earmarks.

(4) An assessment of the utility of each such earmark in meeting the goals of the Department, set forth using a rating system as follows:

(A) A for an earmark that directly advances the primary goals of the Department or an agency, element, or component of the Department.

(B) B for an earmark that advances many of the primary goals of the Department or an agency, element, or component of the Department.

(C) C for an earmark that may advance some of the primary goals of the Department or an agency, element, or component of the Department.

(D) D for an earmark that cannot be demonstrated as being cost-effective in advancing the primary goals of the Department or any agency, element, or component of the Department.

(E) F for an earmark that distracts from or otherwise impedes that capacity of the Department to meet the primary goals of the Department.

(b) Earmark Defined.--In this section, the term ``earmark'' means a provision of law, or a directive contained within a joint explanatory statement or report accompanying a conference report or bill (as applicable), that specifies the identity of an entity, program, project, or service, including a defense system, to receive assistance not requested by the President and the amount of the assistance to be so received.

Mr. COBURN. Mr. President, this is an amendment that is going to have some emotion with it. I want to talk about it first. There is no question when it comes to the wisdom of many of the Members of our body that directing the Pentagon to do certain things is valuable. We know that from anecdotal experience. But what we don't know is how many times we have told them to do something that has been a complete waste. What I am talking about are earmarks in the Defense authorization bill as well as in the Defense appropriations bill.

There is a wonderful body of knowledge, plus an institutional knowledge, here that helps give wisdom to direct the Armed Services. I believe we ought to be in that position. What this amendment does is ask for a report. I want to explain, for a second--and I want the American public to see--what has happened in terms of earmarks.

In 1994, there were $4.2 billion worth of earmarks in the Defense appropriations bill. Last year, there were $9.4 billion. The question we should be asking is not whether or not there should be earmarks, but what is the result of those earmarks? What is the consequence of the earmarks? Not only were the numbers up, the dollars up, but the numbers have skyrocketed.

So the question which I think would be prudent for us to ask is, No. 1: Earmarks are consuming a larger percentage of defense dollars. They also, according to Pentagon reports and some Members of this body, are taking money away from other priorities that are deemed to be higher a lot of the time. They also account for some of the problems we are having in the emergency supplementals and adding to the rising cost of our debt. Many times they are not needed, but, in fact, they are associated with benefiting a region or an industry that is not necessarily in the highest priority.

So this is not about eliminating earmarks. This is about looking at earmarks and saying: What are we getting for them? Where are they working great for us? Where are they not working? Are they beneficial to the defense of this country? Is it something that gives us a benefit?

The other thing I would remind us of is, in the most recent history we have seen an ethical lapse in association with some earmarks, and we have actually seen some criminal behavior in association with earmarks. That ought to be a part of the report as well.

So the whole idea is to add transparency and accountability to earmarks. Let's look at them. What are we getting for them? What are we losing? What are the opportunity costs that are lost because we have them there? The total annual cost of earmarks in Defense appropriations bills would be put in this report.

We can determine the actual numbers of earmarks and the actual price tags. But we don't know the hidden costs of those earmarks, which include staff time and administration. And we don't know the opportunity cost of those earmarks: What did not happen for our soldiers, what did not happen in terms of procurement because we put in something else of maybe a lesser priority?

The annual report will provide Congress and the public a more complete understanding of the total cost of the earmarks to the Department of Defense, the purpose and location of each earmark, and an analysis of the usefulness of each earmark in advancing the goals of the Department of Defense. This will provide Members of Congress a more complete view of the cost-effectiveness of each project and whether those projects warrant continued funding.

The last amendment we were on started as an earmark. I remind the Members of this body, it started at $200 million, and now will have grown to over $500 million in initiatives and earmarks, but we did not have the benefit of a report such as this to see if we were getting value for this money.

This is a simple amendment. It is not going after earmarks. It is not saying they are bad. It is not saying they are good. What it is saying is: Shouldn't this body know? Shouldn't we know the impact, positively and negatively? Shouldn't we know the lost opportunity cost?

I hope both the ranking member and the chairman of this committee will give this amendment consideration. And I ask for their response.

BREAK IN TRANSCRIPT

Mr. COBURN. Mr. President, the Senate today accepted three amendments that I offered to S. 2766, the National Defense Authorization Act for Fiscal Year 2007, intended to improve transparency and accountability of taxpayer funds provided to the Department of Defense.

Amendment No. 4370 addresses the practice of the earmarking of Federal funds by members of Congress. ``Earmarks,'' more commonly known as ``pork projects,'' are provisions inserted into bills or directives contained within a joint explanatory statement or reports accompanying bills specifying the identity of an entity, program, project or service to receive assistance.

Many Congressional earmarks inserted within Defense appropriations bills are not needed, or even wanted, by the Pentagon. Just this week, the Washington Post published an article titled, ``The Project That Wouldn't Die; Using earmarks, members of Congress kept money flowing to a local company that got $37 million for technology the military couldn't use.''

Earmarks contained within Defense appropriations bills have been linked to a number of recent Congressional corruption and ethics probes. Convicted super-lobbyist Jack Abramoff openly boasted that earmarks were his political currency and he called the Appropriations Committee that doles them out a ``favor factory'' for lobbyists.

The $80 billion emergency supplemental passed last year was riddled with add-ons. It included $10 million to expand wastewater facilities in Swiftwater, PA. The University of Texas Southwestern Medical Center got $3 million. A wastewater treatment plant in Desoto County, MS, got $35 million, and $4 million went to the Fire Sciences Academy in Elk, NV. While these many have been local priorities for these communities, it is difficult to argue that they are needed for our national defense.

In its report on its fiscal 2001 Defense appropriations bill, the Senate Appropriations Committee wrote: ``The committee understands that medical studies indicate the potential benefits of cranberry juice and other cranberry products in maintaining health. The committee urges the Secretary of Defense to take steps to increase the department's use of cranberry products in the diet of on-base personnel and troops in the field. Such purchases should prioritize cranberry products with high cranberry content such as fresh cranberries, cranberry sauces and jellies and concentrate and juice with over 25 percent cranberry content.''

Most Americans do not support earmarking Federal funds, especially for such dubious purposes that serve parochial interests at the expense of our national defense. A recent Wall Street Journal/NBC News poll, in fact, found that of all the issues facing our nation, curtailing earmarks was identified as ``the single most important thing for Congress to accomplish this year.''

The number of earmarks in Defense appropriations laws has grown from about 587 in fiscal year 1994 to about 2,847 in fiscal year 2006, according to a recent report by the Congressional Research Service, CRS. The amount of money earmarked has increased over the same period, from about $4.2 billion to $9.4 billion. The amount earmarked as a percentage of the total in the Defense appropriations bill has correspondingly increased from about 1.8 percent in 1994 to approximately 2.4 percent in 2006.

While we can determine the total number of earmarks and the actual pricetag of each, we have no way of calculating the hidden cost of earmarking, which includes staff time and administration expenses.

Specifically the amendment accepted today requires the Department of Defense to report annually: The total annual cost of earmarking in Defense appropriations bills; the purpose and location of each earmark; an analysis of the usefulness of each earmark in advancing the goals of the Department of Defense. This will provide Members of Congress a more complete view of the cost effectiveness of each project and if such projects warranted continued funding.

This annual report will provide Congress and the public a more complete understanding of the total cost of ``pork'' to the Department of Defense.

The earmark grading system will, likewise, provide needed information to lawmakers and the public about projects inserted into bills that have not had proper oversight, debate or discussion. This added transparency will ensure that every Member of Congress can cast a truly informed vote and ensure greater accountability for how Federal funds are allocated and hopefully return some integrity to the appropriations process that has been undermined by recent investigations into earmarking.

My second amendment, No. 4371, accepted by the Senate today seeks to end the practice of Defense contractors being rewarded for poor performance. The Department of Defense has been improperly paying awards and incentives to contractors that do not fulfill the terms and conditions of their contracts. These are intended to be paid only for outstanding performances on contracts but are routinely paid out without regard to performance.

In a recent study conducted by the Government Accountability Office, GAO, DOD paid out at least $8 billion in fees over 4 years, the vast majority of which were not earned and were improperly awarded. This of course, was just a small fraction of the overall total of award fees given out to contractors every year.

My amendment seeks to end this process and require performance as a prerequisite for award fee bonuses. My amendment specifically requires that a contractor cannot receive an award fee unless the contractor has met the basic requirements of the contract.

This amendment has the potential to save the Federal Government billions of wasted tax dollars every year and improve contractor performance.

The third amendment, No. 4491, as modified, will require DOD's Defense Travel System, DTS, to transform its ``cost plus'' contract to a fee-for-use-of-service system similar to the private sector travel reservation systems currently available in the marketplace.

DTS was initiated in 1998 DTS and intended to make travel arrangements for the military service branches and defense agencies. It was supposed to be fully deployed by 2002. However, that date has been pushed back to September 2006--a delay of over 4 years--and has cost the American taxpayer $474 million--a staggering $200 million more than it was originally projected to cost.

DTS has a long record of failure. In July 2002, the DOD inspector general released a report on DTS which highlighted numerous concerns with the program and stated that DTS was being ``substantially developed without the requisite requirements, cost, performance, and schedule documents and analyses needed as the foundation for assessing the effectiveness of the system and its return on investment.'' Following on that IG report, DOD's office for Program Assessment and Evaluation prepared a report recommending termination of the program.

In January 2006, GAO reported that ``DTS's development and implementation have been problematic ..... thus it is not surprising that critical flaws have been identified, resulting in significant slippages between the planned and actual deployment dates of the system'' and that selected requirements for display of flights and airfares found that system testing was ``ineffective in ensuring that the promised capability was delivered as intended.''

This means that not only is DTS not performing, the current system is incapable of testing properly in order to determine what is required in order to meet DOD's plan.

Further, DOD could not prove that DOD travelers even had access to the flights that were available for travel. There is no doubt such a flaw would have produced higher travel costs.

Compounding this problem is the fact that some DOD agencies continue to use the existing legacy travel systems at locations where DTS is already deployed. This means that all of the proclaimed savings that DTS was supposed to reap are nowhere to be found--because DOD continues to use legacy systems to do the same thing.

As originally envisioned, DTS was supposed to be a pay-for-use-of-service system in which the DTS was paid by the government based only on the extent to which the system was used--thereby creating an incentive for DTS to be a cost effective travel reservation system for the Department of Defense.

This amendment requires the Department of Defense to honor the original intentions of the DTS contract. Within a year of enactment of this bill, DTS will be required to utilize a fee-for-use-of-service system. The funds raised through fees charged will be used by DTS to pay for its operational and maintenance costs as the system is slated to be fully developed and deployed by September 2006. DTS will be required to: (1) levy a one-time, fixed price service fee per DOD consumer using the system, and (2) charge an additional fixed fee for each transaction.

Together these three amendments ensure greater transparency and accountability of Federal funds and ensure taxpayers and our men and women in service are guaranteed that the funds we are spending on the defense of our Nation are better spent.

I would like to thank Chairman WARNER and his staff and look forward to continuing to work with them on these issues as this bill goes to conference.

http://thomas.loc.gov/

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