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  • How does the Department of Defense spend money?
  • The Department of Defense (DOD) spends billions of dollars annually using fixed-price-type contracts to acquire its major defense acquisition programs (MDAPs)—including aircraft, ground vehicles, missiles, ships, and satellites.
  • How much did the DoD spend on fixed-price-incentive contracts?
  • From fiscal year 2010 to fiscal year 2019, DOD-wide obligations on fixed-price-type contracts decreased slightly. However, within that time frame, DOD obligations on fixed-price-incentive contracts increased from $16 billion to $50 billion.
  • How much does the DoD have to do with MDAP contracts?
  • DOD’s obligations on FPI contracts associated with MDAPs have grown over the past 10 years to account for almost half of the $63.5 billion in obligations for fiscal year 2019.
  • Does DOD use FPI contracts for major defense acquisition programs?
  • GAO recommends that DOD conduct an assessment of its use of FPI contracts for major defense acquisition programs, including the extent to which share lines and other contract elements contributed to achieving desired cost and schedule performance outcomes. DOD agreed with GAO’s recommendation. View GAO-21-181.
  • How much did DoD obligations increase over time?
  • However, within that time frame, DOD obligations on fixed-price-incentive contracts increased from $16 billion to $50 billion. Obligations on firm-fixed-price contracts decreased, and obligations on cost-type contracts stayed about the same for this same time period (see fig. 5).
  • Why did the army get a $335 million FFP contract?
  • For a $335 million Army FFP contract for sensors, Army officials stated that they were able to use an FFP contract because the Army had actual cost data from previous contracts that showed the contractor’s proposed cost was within 4 percent of the actual costs in most instances over the last 5 years.