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Contractor-Acquired Government Owned (CAGO) Equipment

What is it?
Non-standard CAGO, or "white" equipment, is often purchased to support global contingency operations. The Army's Logistics Civil Augmentation Program (LOGCAP) has acquired more than 660,000 commercial line items of equipment totaling more than $3.6 Billion in Iraq and Afghanistan alone. Because such equipment is not military standard ("green") and cannot be returned to the Army's inventory, it is of little utility once this equipment is no longer needed to fulfill mission requirements.

What has the Army done?
In conjunction with implementing changes to procurement policy and refining acquisition processes, the Army has extensively planned for the most effective way to dispose of "white" equipment that is no longer needed. Because of its highly specialized nature and its tendency for long lead-times, "white" equipment has significant resale potential. The Army conducted a business case analysis (BCA) in 2007 to determine the most effective disposition options. The analysis revealed that 85 percent of all LOGCAP III items were excluded from repatriation due to policy constraints, international agreements, and/or basic cost feasibility. However, the majority of remaining items (approximately 14 percent), were identified as candidates to repair and refurbish for sale on the global market.

What continued efforts does the Army have planned for the future?
As "white" equipment exceeds the combatant commander's needs, it will be inspected and evaluated against the business model established through the BCA. This process will allow the Army to determine the most effective method of disposition such as retention for future use, sale on the commercial market, or disposal through the Defense Reutilization and Marketing Service.

Why is it important to the Army?
In the context of the LOGCAP III BCA, repairing and refurbishing "white" equipment for resale on the global market would cost the government an estimated $18.8 Million, but could potentially return an estimated $1Billion. Through the facilitation of the Army Working Capital Fund, the ultimate proceeds can be returned to the Army to off-set LOGCAP operational costs, thereby maximizing the responsible application of appropriated monies.

POC: Ms. Kimberly Morris (703) 692-5101

 
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