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PLRD-83-58 1 (1983-03-22)

handle is hein.gao/gaobabmwp0001 and id is 1 raw text is: UNITED STATES GENERAL ACCOUNTING OFFICE WASHINGTON, D.C. 20548 PROCUREMENT, LOGISTICS, AND READINESS DIVISION MARCH 22, 1983 o B-208261 The Honorable Howard H. Baker, Jr. United States Senate RELEASED The Honorable Jim Sasser United States Senate Subject: Army Manufacture of the Mark 58 Smoke Marker (GAO/PLRD-83-58) Your July 12, 1982, letter expressed concern regarding the Army's plan to start in-house production at the Crane Army Ammunition Activity of all Mark 58 Smoke Markers previously produced in part by the Kilgore Corporation of Toone, Tennessee. You stated that this appears to contradict the administration's policy of relying on the private sector for goods and services. You asked us to review this matter and provide you with a report. SCOPE AND METHODOLOGY We reviewed the procurement and production history of the Mark 58. We interviewed Army officials responsible for its procurement, production, and management. In addition, we obtained written responses from the Army Armament Material Readiness Command (ARRCOM) to questions on the policies and justification for the Army's in-house production of the Mark 58 and obtained a legal opinion from the ARRCOM Procurement Law Division. We also interviewed officials of the Crane Army Ammunition Activity and the Naval Weapons Support Center, Crane, Indiana; the Ships Parts Control Center, Mechanicsburg, Pennsylvania; and the Kilgore Corporation. We reviewed the policies and procedures in Office of Management and Budget (OMB) Circular A-76 and various laws. Our review was made primarily at ARRCOM, Rock Island, Illinois. Our review was made in accordance with generally accepted government audit standards. BACKGROUND The Crane Army Ammunition Activity is a Navy facility which was leased to the Army in 1977 when it was designated the Depart- ment of Defense single manager for conventional ammunition. The Mark 58, which is a Navy item, was produced at Crane from 1967 to 1971. No additional Mark 58s were made until a contract was awarded to Kilgore to produce Mark 58s for the 1977 program. The fiscal year 1978 Mark 58 program requirements were produced by both Kilgore and Crane. Navy officials said production of the 1978 requirements had been divided to insure continuous production (942208) ;_i% 1

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