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Military stashes covert millions

The Pentagon asks MacDill's Special Operations to tuck an extra $20-million into its budget until it's needed.

Published September 28, 2003

TAMPA - The U.S. Special Operations Command at MacDill Air Force Base inflated budget proposals at the Pentagon's request last year to hide $20-million from Congress, according to documents obtained by the St. Petersburg Times.

Special Operations officials divided the money among six projects so the money would not attract attention. They also instructed their own budget analysts not to mention it during briefings with congressional aides, the documents show.

The Pentagon's inspector general has launched an investigation. House Appropriations Chairman C.W. Bill Young, R-Largo, said he will ask Defense Secretary Donald Rumsfeld during a hearing Tuesday whether the Pentagon intentionally deceived Congress.

"That doesn't set well with me," Young said. "We don't operate like that."

The investigation centers on an agreement between the Pentagon comptroller's office in Washington and the Special Operations Command comptroller at MacDill.

The plan, according to defense officials and documents obtained by the Times, called for Special Operations to pad its proposed budget by $20-million so the money could be used later by the Pentagon for some other purpose. The Pentagon initially wanted Special Operations to hide $40-million. The Special Operations Command, which oversees the nation's secret commando units, refused.

It is unclear what the Pentagon intended to do with the $20-million, or what became of the money. Young surmised that the money could have been used as a contingency fund, available to Rumsfeld to use at his discretion. While $20-million is relatively modest in a Pentagon budget of almost $400-billion, Young said, if all the armed services are doing it the amount could grow significantly.

"I don't know if it's been done before," he said, "or if it's common practice with the secretary."

Gen. Bryan D. "Doug" Brown, who became the Special Operations commander at MacDill earlier this month, declined to comment and cited the ongoing investigation. Brown, who had been the deputy commander, said he requested that the Pentagon inspector general investigate the allegations.

Col. Samuel Taylor, the Special Operations spokesman, said the command is cooperating with investigators.

"The only thing I can tell you is it is not a standard practice for SoCom to improperly utilize funding," he said, "and the IG investigation will determine if there is something inappropriate in this situation."

The agreement between the Pentagon officials in Washington and Special Operations officials in Tampa is spelled out in an e-mail distributed by SoCom comptroller Elaine Kingston to colleagues on Feb. 11, 2002.

In the e-mail, Kingston wrote that she received a call from someone in the Pentagon comptroller's office. The caller, who is not identified in the e-mail, asked if the Special Operations Command could "park" $40-million of research and development money in its proposed budget for the 2003 fiscal year, which ends Tuesday.

"They needed an answer in 5 minutes," Kingston wrote. "The agency they had it parked with had a problem and couldn't do it."

Kingston wrote that "there was no way for us to park $40M." She wrote that she and Deborah Kiser, SoCom's investment appropriations budget chief, found six programs where they could add $20-million.

The programs listed in the e-mail include improvements to missile warning systems on Special Operations aircraft, infrared equipment on helicopters and radar systems. The $20-million was distributed in amounts as small as $2-million and as large as $5-million.

In her e-mail, Kingston coached colleagues on how to account for the additional money and avoid attracting attention to it in congressional briefings.

"I just wanted to follow up with an e-mail to ensure that the staffer briefing slides for these programs DO include these funds and that the briefer not highlight or discuss them during the staffer briefings," she wrote.

"In other words, we can't say "my original program was XX but OSD parked some money in it so now it's YY,' " Kingston wrote, using the abbreviation for the Office of the Secretary of Defense. "We are doing a favor for OSD which we hope will benefit the command if we should need additional (research and development) in FY03."

Special Operations chose programs that already were getting spending increases and added small amounts so they would not stand out, Kingston wrote.

Young said he is confident Special Operations got the additional $20-million it requested. He said he would investigate what became of the money.

The Anti-Deficiency Act says money appropriated by Congress can only be used for the purpose authorized by Congress. There are other federal laws and regulations that prohibit submitting fraudulent budget documents to Congress.

Young said he plans to ask Rumsfeld about the case during a hearing Tuesday on President Bush's $87-billion funding request for Iraq.

The Pentagon's inspector general began an audit, or a preliminary investigation, in August. In a letter dated Aug. 6 to Gen. Charles Holland, the Special Operations commander who has since retired, the inspector general said, "Our objective will be to review the allegations to the Defense Hotline concerning funds "parked' at the U.S. Special Operations Command by the Office of the Under Secretary of Defense (Comptroller)."

Special Operations officials said inspector general investigators have visited MacDill.

Young said he did not know if "parking" money as described in the Special Operations e-mail is common throughout the Department of Defense or an unusual occurence.

"What bothers me is that Congress wasn't notified," Young said. "Constitutionally, Congress needs to be notified of things like this."

But Kingston, the Special Operations comptroller, began her e-mail by assuring colleagues that the request by the Pentagon comptroller was not unusual.

"It is common practice for OSD comptroller to keep small withholds of funds in each appropriation to cover pop up emergencies throughout the year of execution," she wrote. "So OSD goes out to all of the services and (defensewide) agencies to ask for help in justifying these dollars against existing programs in the budget."

The General Accounting Office, the investigative arm of Congress, said it was not familiar with the practice outlined by Kingston.

Winslow Wheeler, an analyst with the Center for Defense Information and a former national defense analyst with the Senate Budget Committee, said Kingston's use of the term "park" to describe hiding Pentagon funds suggested it was common practice.

"It is the consequence of an overstuffed budget," Wheeler said.

He characterized Pentagon recordkeeping as "incompetent," with budget officials routinely unable to keep track of expenditures.

In the wake of 9/11, the special operations forces have become favorites of Rumsfeld and the White House. The 46,000 elite commandos have been at the forefront of the war on terror and played crucial roles in the U.S. invasions of Afghanistan and Iraq.

Rather than relying on large armies, the Bush administration says unconventional forces are best prepared to fight terrorists. As a result, the SoCom mission is shifting, with more responsibility, more people, more weapons and a lot more money.

Announcing the changes earlier in the year, Rumsfeld said, "The global nature of the war, the nature of the enemy and the need for fast, efficient operations in hunting down and rooting out terrorist networks around the world have all contributed to the need for an expanded role for the special operations forces."

Last year, special ops units operated in more than 150 countries. Often in concert with the CIA, special operators are chasing terrorists, weapons of mass destruction and drug runners.

- Paul de la Garza can be reached at 813 226-3432, or at

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