Pentagon is policy. (Influenced by current Admin.)
DoD contracts are politics. (Influenced by what can be justified by politicians in budget hearings and voted on by Congress as a whole.)
Pentagon is an antiques appraiser. They say something is worthless. Admin says, "cool, lets give away lots of that."
Dod Contracts are the antique owner. They say something is valuable. Because well, profits.
In reply to pheller :
Thanks for the link. There we have it:
"Changing the valuation of the equipment could delay the Biden administrations' need to ask Congress to authorize more funds for Ukraine as the debt ceiling fight intensifies."
That sounds political to me.
And now the discrepancy is $3B. Oh well. What's a few billion among friends?
SV reX said:In reply to alfadriver :
I agree.
Just don't get switching the price tags.
So going on the Challenge thing. Lets say someone shows up to the Challenge with a rusty Miata. They bought it brand new many years ago, put +200k miles on it, and there's a lot of rust. Did nothing to it, as they claimed it to be $2000.
You think it's only worth $1000. And many other posters here also think $1000 is a FMV.
I could be wrong, by my Challenge impression of you and other posters is that you and others would tell that person that a better FMV is $1000, giving them $100x to spend on the car.
Get more out of the project than the original estimate.
Oh it's totally political.
Which side you choose is entirely up to you.
Personally, I have a hard time valuing equipment that's been sitting around for decades as it's current brand new replacement cost, especially when we're not even sure if the new replacement is even needed.
Tom_Spangler (Forum Supporter) said:1988RedT2 said:Hmmm. Old white guy cooking the books. Wonder who that could be?
If you think it's just one person, or that it's anything new, I have some bad news for you...
Hey, man. I'm just here to enjoy the show. Same as you.
In reply to alfadriver :
In your example, the person claiming the Miata is worth $2000 (a military manufacturer) also has a buyer willing to give them $2000 for the Miata. (Politicians advocating for defense spending budgets).
The Challenge group (Administration) claiming the FMV is $1000 is so that more money can spent on mods (more Ukraine aid).
In reply to alfadriver :
There are procedures for establishing FMV set out in the Challenge rules. The amount is determined before the car arrives at the event. No one changes it at the event.
That metaphor has exhausted its usefulness.
In reply to pheller :
Yes, I understand there are 2 different government agencies involved.
The point is they already determined the value (both agencies agreed), then CHANGED the value AFTER it had already been sent to free up more opportunity to release aid without additional Congressional approval.
(edit)...and the journalists reported it as "found money". Which is kinda dumb.
Here's how I think this went down:
- Ukraine asks admin for aid.
- Admin asks Congress for aid.
- Congress approves, but due to lobbyists, wants the aid package dollar amount based on replacement cost.
- Pentagon sends aid, but tracks depreciated value of equipment.
- Admin comes back and says "good news, the depreciated value is much lower than the aid package dollar amount, we can send more aid!"
- Certain Senators fire back "but wait, we wanted it calculated based on replacement cost."
- Admin: 
- Certain Senators: "We're not going to approve future aid if you keep adjusting value of aid based on depreciated value."
In reply to pheller :
Yep. Shenanigans.
Ah good question: why did the admin change how it was valuing the aid given?
My guess is that the replacement value noted in the bill was overlooked by the admin, and wasn't brought up until the final bill was tallied. There was likely a laudnry list of equipment in the bill, with a total (replacement cost) of $6 billion.
Pentagon gathers all the stuff, sends it to Ukraine. Gives the bill to the Admin, who says "oh look, the depreciated cost saved us $3 billion."
Congress comes back barking "but wait, we specifically outline this laundry list was worth $6 billion!"
Admin is like "uhhh no it isnt."
I'm sure there is some legal stuff happening between the branchs of government that allows that admin to determine the value of aid based on however they see fit, regardless of what congress might claim in a bill.
I'm sure if they really wanted they could claim all the stuff sent was worth $1.
Here's the bill from last year: https://www.congress.gov/bill/117th-congress/house-bill/7691/text
Operation And Maintenance, Defense-Wide
(including transfer of funds)
For an additional amount for “Operation and Maintenance, Defense-Wide”, $15,256,824,000, to remain available until September 30, 2022, to respond to the situation in Ukraine and for related expenses: Provided, That of the total amount provided under this heading in this Act, $6,000,000,000, to remain available until September 30, 2023, shall be for the Ukraine Security Assistance Initiative: Provided further, That such funds for the Ukraine Security Assistance Initiative shall be available to the Secretary of Defense under the same terms and conditions as are provided for in section 8139 of the Department of Defense Appropriations Act, 2022 (division C of Public Law 117–103): Provided further, That of the total amount provided under this heading in this Act, up to $9,050,000,000, to remain available until September 30, 2023, may be transferred to accounts under the headings “Operation and Maintenance” and “Procurement” for replacement of defense articles from the stocks of the Department of Defense, and for reimbursement for defense services of the Department of Defense and military education and training, provided to the Government of Ukraine or to foreign countries that have provided support to Ukraine at the request of the United States: Provided further, That funds transferred pursuant to the preceding proviso shall be merged with and available for the same purposes and for the same time period as the appropriations to which the funds are transferred: Provided further, That the Secretary of Defense shall notify the congressional defense committees of the details of such transfers not less than 15 days before any such transfer: Provided further, That upon a determination that all or part of the funds transferred from this appropriation are not necessary for the purposes provided herein, such amounts may be transferred back and merged with this appropriation: Provided further, That the transfer authority provided herein is in addition to any other transfer authority provided by law.
This is interesting, this politico article notes that it was Republicans who initially wanted the aid valued lower upon discovering the errors:
https://www.politico.com/minutes/congress/05-18-2023/whats-to-come-for-santos/
"Angry chairs: House Foreign Affairs Chair Mike McCaul (R-Texas) and House Armed Services Chair Mike Rogers (R-Ala.) penned a statement calling the disclosure and its timing “extremely problematic, to say the least.”"“These funds could have been used for extra supplies and weapons for the upcoming counteroffensive, instead of rationing funds to last for the remainder of the fiscal year,” they wrote."
"The Department of Defense's change in evaluating the costs of arms sent to Ukraine is a major mistake," U.S. Senator Roger Wicker, the top Republican on the Senate Armed Services Committee, said. "Its effect would be to underestimate future needs for our European allies. Our priority should be a Ukrainian victory over Putin. Unilaterally altering military aid calculations is an attempt at deception and undermines this goal."
https://www.rubio.senate.gov/public/index.cfm/2023/6/rubio-demands-ukraine-equipment-cost-transparency
"Undervaluing the equipment means it will be more expensive for the American taxpayer to replace in order to defend the U.S. and its interests."
Sounds like there is some disagreement within Republican Congress about how much this stuff should cost...
SV reX said:In reply to alfadriver :
There are procedures for establishing FMV set out in the Challenge rules. The amount is determined before the car arrives at the event. No one changes it at the event.
That metaphor has exhausted its usefulness.
It hasn't to me. Not sure why you don't see it. I see it as the exact same thing.
And it's funny how you become so adamant that the rules are that stiff when you and others might disagree on the number when it would benefit the competitor. Mistakes happen, even in interpretation of the numbers. Are you really saying that if a competitor makes a mistake that make their project harder, you would not help correct them to get more out of it?
Really, that's all that's happened here, Congress approved $X, and someone has reinterpreted the stuff that they can get more after the first round was sent out. And since almost all of this would end up as military waste, well...
In reply to alfadriver :
Nope. Truly don't know what you are referring to. I've never argued a competitor's FMV.
You do you.
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