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B-172428 1 (1973-03-22)

handle is hein.gao/gaobaaggp0001 and id is 1 raw text is: UNITED STATES GENERAL ACCOUNTING OFFICE P/> - WASHINGTON, D.C. 20548 PROCUREMENT AND SYSTEMS IIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIII ACQUISITION DIVISION LM096425 B-172428 VIAR The Honorable Elliot L. Richardson Theb Secretary of Defense Attention: Assistant Secretary of Defense (Comptroller) Dear Mr. Secretary: The General Accounting Office has reviewed the _ro.c ent In the Far East of recombined mijkl and milk products totaling $naliii rrl We examined contracts awarded-to _'doof tractors in Japan, Okinawa, Korea, Taiwan, Thailand, and Viet- nam to find out whether the cost of these milk products could be reduced. We determined, on the basis of current operations, that the Department of Defense could annually save (1) $1.5 million by replacing the operation of milk plants by commercial con- tractors with the Army and Air Force Exchange Service, (2) $170,000 by using the Military Sealift Command to trans- port supplies and ingredients from the United States to the Far East, and (3) $708,000 by purchasing nonfat dry milk from U.S. Government surplus stocks. POTENTIAL SAVINGS BY USE OF IN-HOUSE OPERATIONS Throughout most of the Far East, U.S. military require- ments for dairy products are satisfied by commercial contrac- tors. The contractors are American firms and operate milk plants in six Far East countries. The U.S. Army Procurement Agency, Japan, is responsible for awarding dairy contracts, and on July 1, 1972, it had seven outstanding contracts valued at about $14.7 million a year, as shown below. IRecombined milk is made by mixing-dry milk and fat with water. ~~~ (b9~

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