Pentagon takes ‘use it or lose it’ approach to funds

The “blitzkrieg” was a popular German battle tactic in World War II to attack enemies and overrun their defenses before they could fight back.

Now the Pentagon has perfected its own twist on the tactic: spend money lightning fast, before anyone has a chance to respond.

Fiscal watchdogs are warning that attitude has taken hold not just at the Pentagon, but across the entire federal government.

The “use it or lose it” mentality critics say is infecting federal agencies stands in stark contrast to the budget reality, where cuts and sequestration have become the norm.

“Spending just skyrockets during the last couple of weeks of the fiscal year because they fear that if you don’t spend your budget, you’re going to lose it,” said Bill Riggs, spokesman for the nonprofit Public Notice, which focuses on economic issues.

For its rushed spending at the end of the year to eat up funds, the Defense Department wins this week’s Golden Hammer, a Washington Times distinction given to examples of waste, fraud and abuse. But it isn’t the only culpable agency. Nor is it the only one suffering from the “use it or lose it” mentality.

The federal government works on a different system than the normal calendar. It’s known as the fiscal year, and starts in October and ends in September. Agencies are given budgets and authorized to spend certain amounts during those 12 months.

But critics say the system has created concern among agencies that if they don’t use their whole budget, it will indicate to Congress they don’t need as much and they’ll receive less money next year.

A review of spending records shows that in the waning months of the last fiscal year (August and September of 2012), the Pentagon purchased or attempted to purchase a number of items that seem less than necessary to its main mission defending the United States. Information comes from the website FedBizOpps, which the government uses to advertise to contractors the objects and services it needs to purchase.

Musicians got some shiny new instruments, as the Navy paid $51,000 for clarinets and $21,000 for an organ. The Army spent $40,000 on violins.

Meanwhile, the Army National Guard bought $18,000 worth of coffee mugs for recruitment, while the Air Force put in requests for wrestling mats, 40 TVs for dormitories, volleyball equipment, an e-book platform that could “provide access to current, bestselling [fiction and nonfiction] as found on the New York Times Bestseller List,” and finally, a request for playground equipment that was labeled “urgent.”

But the data can be misleading, and caution is needed when evaluating Defense Department spending, said Pentagon spokeswoman Jennifer Elzea.

For the past few years, Congress has actually passed very few fiscal budgets. That leaves government agencies to run on what’s known as a continuing resolution, basically funding levels from previous years.

Under continuing resolutions, agencies must focus first on funding existing projects and paying salaries, leaving little to no cash or authority to launch initiatives or purchase items.

An internal email from the Defense Information Systems Agency, obtained by The Washington Post, shows that office’s leaders appearing concerned about not meeting certain spending limits.

“It is critical in our efforts to execute 100 percent of our available resources this fiscal year,” the memo said. “It is also imperative that your organization meets its projected obligation goal for June.”

The spending issues aren’t limited to the Defense Department, though. The issue was brought up during a June congressional hearing investigating excessive spending by the Internal Revenue Service on a California conference that cost more than $4 million.

“One of the problems that I think initiated the Anaheim conference was the fact that you were coming to the end of a fiscal year and there was unused money, correct?” asked Rep. Jackie Speier, California Democrat.

“Yes, there was extra money available and clearly in this case that money wasn’t deployed to its highest and best use,” replied Danny Werfel, the acting IRS chief who was brought in after allegations of misconduct at the tax-collection agency.

The issue is not a new one. As far back as 1980, the Government Accountability Office — Congress’ chief watchdog — warned that “year-end surges are a symptom of a larger problem: the failure by agencies and the [Office of Management and Budget] to effectively monitor and manage the execution of the budget.”