I N S T I T U T E F O R D E F E N S E A N A L Y S E S

The Financial Cost and Benefits of Multi-Year Procurements

Scot A. Arnold Bruce R. Harmon

June 2013 Approved for public release;

distribution is unlimited. IDA Document NS D-4895

Log: H 13-000635

INSTITUTE FOR DEFENSE ANALYSES 4850 Mark Center Drive

Alexandria, Virginia 22311-1882

About this Publication The views, opinions, and findings should not be construed as representing the official position of either the Department of Defense or the sponsoring organization.

Copyright Notice © 2013 Institute for Defense Analyses, 4850 Mark Center Drive, Alexandria, Virginia 22311-1882 • (703) 845-2000

The Institute for Defense Analyses is a non-profit corporation that operatesthree federally funded research and development centers to provide objectiveanalyses of national security issues, particularly those requiring scientific andtechnical expertise, and conduct related research on other national challenges.

I N S T I T U T E F O R D E F E N S E A N A L Y S E S

IDA Document NS D-4895

The Financial Cost and Benefits of Multi-Year Procurements

Scot A. Arnold Bruce R. Harmon

The

Fina

ncia

l Cos

t and

Ben

efits

of

Mul

ti-Ye

ar P

rocu

rem

ents

Scot

A. A

rnol

d Br

uce

R. H

arm

on

Que

stio

n

W

hat i

s th

e be

nefit

to th

e go

vern

men

t of u

sing

a

mu l

ti-ye

ar p

rocu

rem

ent (

MYP

)?

U

p-fro

nt p

rice

disc

ount

to a

ltern

ativ

e se

ries

of s

ingl

e-ye

ar p

rocu

rem

ents

(SYP

)

Adde

d in

cent

ive

for c

ontra

ctor

to s

eek

furth

er re

curr

ing

cos t

redu

ctio

ns

W

hat i

s th

e co

st to

the

gove

rnm

ent o

f usi

ng a

n M

YP?

Lo

ss in

con

gres

sion

al a

ppro

pria

tion

flexi

bilit

y

Few

er o

ppor

tuni

ties

to n

egot

iate

pric

es –

hig

her

recu

rrin

g co

st in

form

atio

n as

ymm

etry

Des

crip

tion

of T

wo

Mod

els

D

isco

unte

d ca

sh fl

ow a

naly

sis

of c

ontra

cts

M

odel

1 is

a c

ompa

rativ

e co

st-b

enef

i t an

alys

is

quan

tifyi

ng th

e ch

ange

in p

ricin

g an

d ap

prop

riatio

n fle

xibi

lity

betw

een

diffe

rent

ac

quis

ition

stra

tegi

es

M

odel

2 is

the

cont

ract

or’s

inve

stm

ent d

ecis

ion

mod

el to

ass

ess

the

impl

ied

cost

redu

ctio

n in

cent

ive

with

in a

pro

cure

men

t stra

tegy

Mod

el 1

Det

ails

Sc

enar

io a

naly

sis

SY

P ca

se: s

erie

s of

up

to 3

0 lo

t buy

s, e

.g.,

10-u

nit l

ot

with

a T

1 uni

t cos

t of $

10

M

YP c

ase:

ser

ies

of S

YP a

nd M

YP lo

t buy

s

Econ

omic

and

bus

ines

s fa

ctor

s

Infla

tion,

inte

rest

, and

dis

coun

ting

In

flatio

n re

quire

d fo

r nom

inal

rate

s

Two

inte

rest

rate

regi

mes

: hig

h (s

ynth

etic

) and

to

day’

s lo

w

Sy

nthe

tic y

ield

cur

ve fr

om a

one

-fact

or m

odel

Dis

coun

t rat

e te

nor t

ied

to p

rogr

am le

ngth

Rate

Reg

imes

H

igh

rate

197

0–20

05 a

vera

ge u

sed

t o c

alib

rate

on

e-fa

ctor

mod

el

Lo

w ra

te J

anua

ry 2

013

Trea

sury

cur

ve (F

RED

)*

0%1%2%3%4%5%6%7%8%9%10%

- 5

0 1

00 1

50 2

00 2

50 3

00 3

50 4

00

Yield

Mat

urity

(Mon

ths)

Inte

rest

Rat

e R

egim

es H

igh

Low

*Fed

eral

Res

erve

Ban

k of

St.

Loui

s E

cono

mic

Dat

a

Mod

el 1

: Eco

nom

ic a

nd B

usin

ess

Fact

ors

M

YP s

avin

gs

D

efin

ed a

s a

perc

enta

ge re

duct

ion

in c

ost r

elat

ive

to

the

SYP

alte

rnat

ive

Ap

plie

d to

all

of th

e M

YP lo

ts; e

.g.,

a 10

% s

avin

gs

rel a

tive

to th

e fiv

e 10

-uni

t lot

s in

the

SYP

alte

rnat

ive

is a

pplie

d to

all

50 u

nits

in th

e M

YP c

ase

Le

arni

ng a

nd c

ost r

educ

tions

All c

ost r

educ

tions

ass

umed

to b

e re

veal

ed to

go

vern

men

t, w

ith o

r with

out a

lag,

for b

oth

MYP

and

SY

P co

ntra

cts

(ex

post

lear

ning

effe

ct)

SY

P pr

ices

inco

rpor

ate

ex p

ost l

earn

ing

annu

ally

Mod

el 1

: Eco

nom

ic a

nd B

usin

ess

Fact

ors

(Con

t.)

Le

arni

ng a

nd c

ost r

educ

tions

(con

t.)

M

YP p

rices

inco

rpor

ate

lear

ning

eve

ry fi

ve y

ears

Assu

mes

one

lear

ning

cur

ve fo

r ent

ire p

rogr

am

Ad

vanc

e pr

ocur

emen

t (AP

) and

term

inat

ion

liabi

lity

(TL)

AP is

3%

of t

he c

ontra

ct c

ost

Th

e TL

is tr

eate

d as

a re

serv

e

The

cost

of t

he T

L =

TL a

mou

nt *

cos

t of c

apita

l (at

m

atch

ed d

urat

ion)

AP,

Pay

men

t Sch

edul

e, a

nd T

L

SYP

M

YP

Pay

men

ts

TL

P

aym

ents

T

L

Adva

nced

3%

3%

Ye

ar 1

30

%

34%

13

%

40%

Ye

ar 2

40

%

24%

13

%

37%

Ye

ar 3

27

%

0%

14%

35

%

Year

4

15%

30

%

Year

5

15%

26

%

Year

6

15%

3%

Ye

ar 7

13

%

0%

0%5%10%

15%

20%

25%

30%

35%

40%

45%

01

23

45

67

Paym

ents

TL

Mod

el 1

Sce

nari

o A

naly

ses

Stra

tegi

es: 1

5 S

YP

s vs

. 5

SY

Ps/

2 5-

yr. M

YP

s

Infla

tion:

sm

all e

ffect

– m

ost

impo

rtant

cas

h flo

ws

get

low

est i

nfla

tiona

ry w

eigh

t

TL/A

P -

sen

sitiv

e to

inte

rest

ra

tes

M

YP

sav

ings

are

set

to 1

0%

Le

arni

ng s

et to

95%

for b

oth

case

s

SY

Ps

get l

earn

ing

effe

cts

earli

er

100

1

9

7

36

66

1

65

SY

P w

/oLe

arni

ngIn

flatio

nE

ffect

TL/A

PM

YP

savi

ngs

Lear

ning

MY

P w

/Le

arni

ngR

elat

ive

Lear

ning

Effe

ct

SY

P w

/Le

arni

ng

Hig

h In

tere

st

100

0

2

7

35

61

1

62

SY

P w

/oLe

arni

ngIn

flatio

nE

ffect

TL/A

PM

YP

savi

ngs

Lear

ning

MY

P w

/Le

arni

ngR

elat

ive

Lear

ning

Effe

ct

SY

P w

/Le

arni

ng

Low

Inte

rest

MYP

Dec

isio

n Ru

les:

Rel

ativ

e Le

arni

ng v

s. D

isco

unt

E

ach

line

is th

e in

diffe

renc

e cu

rve

betw

een

an S

YP

and

MY

P s

trate

gy, g

iven

th

e M

YP

dis

coun

t

If th

e M

YP

is e

xpec

ted

to re

duce

re-p

ricin

g op

portu

nitie

s th

e ch

art s

how

s th

e m

inim

um d

isco

unt r

equi

red

for t

he tw

o ac

quis

ition

pla

ns to

hav

e eq

ual N

PV

A S

YP p

lan

with

a 9

1% p

rice

impr

ovem

ent c

urve

is e

qual

to a

n M

YP w

ith a

n 82

%

curv

e an

d a

disc

ount

of 1

4%

A

t the

oth

er e

xtre

me

– a

SYP

pla

n w

ith a

97%

cur

ve is

equ

al to

a M

YP p

lan

with

a

94%

cur

ve a

nd th

e 14

% d

isco

unt

75%

77%

79%

81%

83%

85%

87%

89%

91%

93%

95%

91%

92%

93%

94%

95%

96%

97%

MYP Price Improvement Rate

SYP

Pric

e Im

prov

emen

t Rat

e

2% 4% 6% 10%

12%

14%

MYP

D

isco

unt

Mod

el 1

Con

clus

ions

Th

e op

portu

nity

cos

t ass

ocia

ted

with

the

AP a

nd T

L is

a ta

x on

the

MYP

sav

ings

.

In

low

inte

rest

rate

regi

mes

, the

se c

osts

are

not

iona

lly s

mal

l, bu

t in

high

er in

tere

st ra

te re

gim

es, t

hey

can

offs

et th

e en

tire

savi

ngs.

The

loss

of t

he re

-pric

ing

optio

n w

ith a

n M

YP m

eans

that

the

choi

ce

of w

heth

er o

r not

to u

se a

n M

YP is

sen

sitiv

e to

the

expe

ctat

ion

for

lear

ning

.

If hi

gh le

arni

ng is

exp

ecte

d w

ith a

n S

YP

stra

tegy

, the

n ev

en m

ore

lear

ning

mus

t be

atta

inab

le w

ith th

e M

YP

stra

tegy

in a

dditi

on to

the

MY

P d

isco

unt.

A

lthou

gh th

ere

is s

ome

trade

off b

etw

een

the

MY

P d

isco

unt a

nd th

e ex

pect

ed re

aliz

ed le

arni

ng fr

om th

e M

YP

stra

tegy

, the

dis

coun

t mos

t lik

ely

need

s to

be

wel

l in

exce

ss o

f 5–1

0%.

C

onsi

der t

he c

ase

whe

re th

e ex

pect

ed le

arni

ng fr

om th

e SY

P st

rate

gy is

91%

. The

lost

re-p

ricin

g op

tion

from

the

MYP

impl

ies

a re

quire

d pr

ice

impr

ovem

ent o

f abo

ut 7

5% w

ith a

4%

MYP

dis

coun

t. Th

is re

quire

men

t is

redu

ced

to 8

2% w

ith a

14%

MYP

dis

coun

t.

Mod

el 2

Det

ails

C

ontra

ctor

vie

ws

acqu

isiti

on fo

reca

st a

nd

plan

s in

vest

men

t dec

isio

ns to

max

imiz

e N

PV

ac

ross

all

T co

ntra

cts:

D

isco

unt

Fact

or

tth C

ontra

ct

Rev

enue

, In

clud

ing

Fee

- ba

sed

on

lagg

ed c

ost

effic

ienc

y (a

t-l)

Cos

t Effi

cien

cy –

C

apita

l Int

ensi

ty R

ule

Cos

t Fun

ctio

n

Con

tract

or

Inve

stm

ent f

or

tth C

ontra

ct

k t+1

= k

t(1-d

)+ i t

k

is th

e ca

pita

l sto

ck, d

is

cont

ract

per

iod

depr

ecia

tion,

and

i is

the

co

ntra

ct in

vest

men

t. Th

e te

rm

is

the

resi

dual

cap

ital s

tock

.

Mod

el C

alib

ratio

n w

ith F

-22

Acq

uisi

tion

Pa

ram

eter

s w

ere

estim

ated

iter

ativ

ely

by

fittin

g m

odel

out

puts

to

F-22

uni

t cos

ts u

sing

pr

ogra

m v

aria

bles

(lot

qu

antit

ies,

T1,

and

cont

ract

or in

vest

men

ts)

and

othe

r dat

a re

leva

nt

to th

e pr

ogra

m.

Th

e D

D F

orm

154

7 da

taba

se w

as u

sed

for

corr

obor

ativ

e an

alys

es

020406080100

120

140

160

180

050

100

150

200

Unit Price, Millions of FY10$

Cum

ulat

ive

Qua

ntity

T 1 c

ost (

a 0)

$325

Mill

ion

(FY

10)

Exog

enou

s lea

rnin

g cu

rve

(b)

82%

(b=

-.286

) R

egul

ator

y la

g pe

riod

(l)

2 ye

ars

Faci

litie

s cap

ital m

ark-

up (γ

) 17

.5%

A

nnua

l dis

coun

t fac

tor (

Β)

0.85

(a d

isco

unt r

ate

of 1

7.6%

) C

oeffi

cien

t on

capi

tal (

β)

0.15

C

apita

l sto

ck re

sidu

al v

alue

(ϕ)

50%

D

epre

ciat

ion

rate

(δ)

10%

per

yea

r M

YP

disc

ount

(θ)

4%

Initi

al c

apita

l int

ensi

ty (k

0/c0)

20

%

Initi

al c

ontra

ct fe

e (%

of c

ost)

13%

Mod

el 2

Sce

nari

o A

naly

ses

M

odel

2 w

as u

sed

to e

stim

ate

the

rela

tive

effe

ctiv

enes

s of

the

impl

ied

inve

stm

ent i

ncen

tive

in a

n M

YP w

hen

com

pare

d to

alte

rnat

ive

proc

urem

ent s

trate

gy s

cena

rios.

Four

sce

nario

s w

ere

exam

ined

, all

usin

g th

e sa

me

para

met

er v

alue

s:

Ba

selin

e M

YP: b

asel

ine

prod

uctio

n sc

hedu

le a

nd q

uant

ities

with

SY

P fo

r the

firs

t six

lots

and

MYP

for t

he fi

nal t

hree

lots

(F-2

2 hi

stor

ical

cas

e).

B

asel

ine

SY

P: b

asel

ine

prod

uctio

n sc

hedu

le a

nd q

uant

ities

with

SY

P fo

r the

fina

l thr

ee lo

ts v

ice

MYP

in th

e ba

se c

ase.

Ext

ende

d 5

x 2

MY

Ps:

bas

elin

e pr

oduc

tion

sche

dule

thro

ugh

Lot

6 (F

Y 20

06) f

ollo

wed

by

two

5-ye

ar M

YP c

ontra

cts

with

a

prod

uctio

n ra

te o

f 36

per y

ear.

E

xten

ded

10 S

YP

s: b

asel

ine

prod

uctio

n sc

hedu

le th

roug

h Lo

t 6

(FY

2006

) fol

low

ed b

y 10

SYP

con

tract

s w

ith a

pro

duct

ion

rate

of

36 p

er y

ear.

Soci

al P

lann

er –

Fir

st B

est C

ase

Inve

stm

ent

In

add

ition

to th

ese

four

sce

nario

s, th

ere

wer

e tw

o be

nchm

ark

scen

ario

s: th

e ba

selin

e an

d ex

tend

ed S

YP c

ases

.

Thes

e sc

enar

ios

are

calle

d B

asel

ine

SY

P

Pla

nner

and

Ext

ende

d 10

SY

Ps

Pla

nner

.

A so

cial

pla

nner

can

see

the

futu

re a

nd th

us c

an

choo

se a

n in

vest

men

t pla

n to

min

imiz

e th

e to

tal c

ost

of th

e pr

ogra

m.

Th

e pl

anne

r sol

ves

the

follo

win

g:

Base

line

Scen

ario

Res

ults

- 0

.05

0.1

0 0

.15

0.2

0 0

.25

0.3

0 0

.35

0.4

0 0

.45

0.5

0 2001

2003

2005

2007

2009

Capital Stock/Cost

Bas

elin

e M

YPB

asel

ine

SYP

Bas

elin

e SY

P Pl

anne

r

Out

put V

alue

B

asel

ine

MYP

B

asel

ine

SYP

Bas

elin

e SY

P Pl

anne

r U

nit p

rice

tota

l pro

gram

(FY1

0$M

) 1

03.5

1

03.3

1

01.3

Uni

t acc

ount

ing

cost

, tot

al p

rogr

am (F

Y10$

M)

88.

7

89.

5

86.

0

Rea

lized

pro

fit, t

otal

pro

gram

16

.6%

15

.5%

17

.8%

Uni

t pric

e, la

st 3

lots

(FY1

0$M

) 8

4.1

8

4.2

8

2.8

Uni

t acc

ount

ing

cost

, las

t 3 lo

ts (F

Y10$

M)

68.

9

73.

2

71.

0

Rea

lized

pro

fit, l

ast 3

lots

22

.0%

15

.0%

16

.6%

Tota

l inv

estm

ent (

FY10

$M)

579

5

20

756

Con

tract

or n

et p

rese

nt v

alue

(FY1

0$M

) 1

,320

1

,273

1

,251

Exte

nded

Sce

nari

o Re

sults

Out

put V

alue

Ex

tend

ed 2

x5

MYP

s Ex

tend

ed 1

0 SY

Ps

Exte

nded

10

SYPs

Pla

nner

U

nit p

rice

tota

l pro

gram

(FY1

0$M

)

80.

7

82.

6

7

9.6

U

nit a

ccou

ntin

g co

st to

tal p

rogr

am (F

Y10$

M)

6

8.4

7

2.2

67.

8

Rea

lized

pro

fit, t

otal

pro

gram

17

.9%

14

.4%

17

.4%

U

nit p

rice,

last

10

lots

(FY1

0$M

)

70.

3

72.

7

6

9.7

U

nit a

ccou

ntin

g co

st, l

ast 1

0 lo

ts (F

Y10$

M)

5

8.8

6

3.2

59.

8

Rea

lized

pro

fit, l

ast 1

0 lo

ts

19.5

%

15.0

%

16.6

%

Tota

l inv

estm

ent (

FY10

$M)

1,3

03

1,05

0

1,

614

C

ontra

ctor

net

pre

sent

val

ue (F

Y10$

M)

2,0

10

1,82

0

1,

729

507090110

130

150 20

0120

0320

0520

0720

0920

1120

1320

15

Unit Price (FY00$M)

Exte

nded

2x5

MYP

sEx

tend

ed 1

0 SY

Ps

- 0

.05

0.1

0 0

.15

0.2

0 0

.25

0.3

0 0

.35

0.4

0 0

.45

0.5

0 2001

2003

2005

2007

2009

2011

2013

2015

Capital Stock/Cost

Exte

nded

2x5

MYP

sEx

tend

ed 1

0 SY

PsEx

tend

ed 1

0 SY

Ps P

lann

er

Mod

el 2

Con

clus

ions

M

odel

2 s

how

s th

at th

e ad

ded

ince

ntiv

e ef

fect

from

the

long

er re

gula

tory

la

g in

an

MY

P le

ads

to m

ore

cost

redu

ctio

n in

vest

men

t by

the

cont

ract

or.

Th

e pr

oble

m fo

r con

tract

ing

auth

oriti

es is

whe

ther

thes

e re

duct

ions

can

be

fact

ored

into

low

er c

ontra

ct p

rices

.

Mod

el 1

and

2 a

gree

: with

out t

he o

ppor

tuni

ty to

neg

otia

te n

ew p

rices

, the

sa

ving

s w

ill be

reta

ined

by

the

cont

ract

or.

R

esid

ual c

ost r

educ

tions

mad

e in

the

last

con

tract

of a

ser

ies

are

fully

re

tain

ed b

y th

e co

ntra

ctor

.

Onl

y ad

ditio

nal c

ontra

cts

follo

win

g an

MY

P g

ive

the

gove

rnm

ent t

he

oppo

rtuni

ty to

cap

ture

the

addi

tiona

l cos

t sav

ings

that

flow

from

con

tract

or

ince

ntiv

es.

W

ith a

ntic

ipat

ed fu

ture

MY

P c

ontra

cts,

Mod

el 2

rais

es th

e po

ssib

ility

that

co

ntra

ctor

s m

ay e

lect

to p

ostp

one

cost

redu

ctio

ns u

ntil

that

poi

nt in

the

futu

re.

G

iven

the

stro

ng in

vest

men

t inc

entiv

e em

bedd

ed in

the

MY

P c

ontra

ct, t

he

gove

rnm

ent s

houl

d an

ticip

ate

thos

e ad

ditio

nal c

ost s

avin

gs a

s it

is

nego

tiatin

g th

e pr

ice.

Sum

mar

y an

d Co

nclu

sion

Bo

th m

odel

s ag

ree

that

the

net s

avin

gs fr

om M

YP c

ontra

cts

can

be

erod

ed b

y th

e lo

ss in

eith

er a

ppro

pria

tions

or r

e-pr

icin

g fle

xibi

lity.

Long

-term

con

tract

s ca

n be

ver

y ef

fect

ive

incu

bato

rs fo

r con

tract

or-

led

effic

ienc

y se

arch

es th

at u

ltim

atel

y lo

wer

pro

cure

men

t cos

ts.

Pr

ocur

emen

t stra

tegi

es th

at u

se th

ese

type

s of

con

tract

s ne

ed to

be

care

fully

des

igne

d w

ith th

e sa

me

or e

ven

grea

ter u

nder

stan

ding

of

the

unde

rlyin

g pr

oduc

tion

cost

s.

G

iven

the

prog

ram

offi

cial

s’ a

bilit

y to

wrin

g ou

t pro

cure

men

t cos

ts,

the

deci

sion

as

to w

heth

er to

use

an

MYP

stra

tegy

rest

s on

whe

ther

th

e N

PV o

f the

dis

coun

t (i.e

., th

e pr

esen

t val

ue o

f the

dis

coun

t les

s th

e re

quire

d in

crem

enta

l AP

and

TL c

osts

) exc

eeds

the

valu

e of

the

re-p

ricin

g op

tion

affo

rded

thro

ugh

mor

e fre

quen

t SYP

neg

otia

tions

.

This

dec

isio

n ca

n be

ana

lyze

d qu

antit

ativ

ely

usin

g th

e si

mpl

e m

etho

ds o

utlin

ed in

this

pre

sent

atio

n.

Fu

rther

rese

arch

sho

uld

be d

one

to v

erify

the

met

hodo

logy

by

exam

inin

g hi

stor

ical

con

tract

cos

t dat

a.

Back

up

2,4

59

3

69

2

01

583

1,7

47

150

1,5

96

SY

P w

/oLe

arni

ngIn

flatio

nE

ffect

TI/A

PM

YP

savi

ngs

Lear

ning

MY

P w

/Le

arni

ngR

elat

ive

Lear

ning

Effe

ct

SY

P w

/Le

arni

ng

SYP

- MYP

Cos

t Wal

k Lo

w In

tere

st -

30 lo

ts

1,0

45

1

22

5

3

206

808

45

763

SY

P w

/oLe

arni

ngIn

flatio

nE

ffect

TI/A

PM

YP

savi

ngs

Lear

ning

MY

P w

/Le

arni

ngR

elat

ive

Lear

ning

Effe

ct

SY

P w

/Le

arni

ng

SYP

- MYP

Cos

t Wal

k Lo

w In

tere

st -

10 lo

ts

Scen

ario

Com

pari

sons

844

3

65

4

3

174

696

55

641

SY

P w

/oLe

arni

ngIn

flatio

nE

ffect

TI/A

PM

YP

savi

ngs

Lear

ning

MY

P w

/Le

arni

ngR

elat

ive

Lear

ning

Effe

ct

SY

P w

/Le

arni

ng

SYP

- MYP

Cos

t Wal

k H

igh

Inte

rest

- 10

lots

1,7

12

13

1

72

143

424

1,3

30

168

1,1

62

SY

P w

/oLe

arni

ngIn

flatio

nE

ffect

TI/A

PM

YP

savi

ngs

Lear

ning

MY

P w

/Le

arni

ngR

elat

ive

Lear

ning

Effe

ct

SY

P w

/Le

arni

ng

SYP

- MYP

Cos

t Wal

k H

igh

Inte

rest

- 30

lots

Lear

ning

Cur

ve S

ensi

tivity

Ana

lyse

s

-

200

400

600

800

1,0

00

1,2

00

1,4

00

1,6

00

85%

90%

95%

100%

15/3

L 1

0% S

SYP

MY

P

-

200

400

600

800

1,0

00

1,2

00

1,4

00

85%

90%

95%

100%

15/3

H 1

0% S

SYP

MY

P

-

200

400

600

800

1,0

00

1,2

00

1,4

00

1,6

00

85%

90%

95%

100%

15/3

L 2

0% M

SYP

MY

P

-

200

400

600

800

1,0

00

1,2

00

1,4

00

85%

90%

95%

100%

15/3

H 2

0% M

SYP

MY

P

Standard Form 298 (Rev. 8/98)

REPORT DOCUMENTATION PAGE

Prescribed by ANSI Std. Z39.18

Form Approved OMB No. 0704-0188

The public reporting burden for this collection of information is estimated to average 1 hour per response, including the time for reviewing instructions, searching existing data sources, gathering and maintaining the data needed, and completing and reviewing the collection of information. Send comments regarding this burden estimate or any other aspect of this collection of information, including suggestions for reducing the burden, to Department of Defense, Washington Headquarters Services, Directorate for Information Operations and Reports (0704-0188), 1215 Jefferson Davis Highway, Suite 1204, Arlington, VA 22202-4302. Respondents should be aware that notwithstanding any other provision of law, no person shall be subject to any penalty for failing to comply with a collection of information if it does not display a currently valid OMB control number. PLEASE DO NOT RETURN YOUR FORM TO THE ABOVE ADDRESS. 1. REPORT DATE (DD-MM-YYYY) 2. REPORT TYPE 3. DATES COVERED (From - To)

4. TITLE AND SUBTITLE 5a. CONTRACT NUMBER

5b. GRANT NUMBER

5c. PROGRAM ELEMENT NUMBER

5d. PROJECT NUMBER

5e. TASK NUMBER

5f. WORK UNIT NUMBER

6. AUTHOR(S)

7. PERFORMING ORGANIZATION NAME(S) AND ADDRESS(ES) 8. PERFORMING ORGANIZATION REPORT NUMBER

9. SPONSORING/MONITORING AGENCY NAME(S) AND ADDRESS(ES) 10. SPONSOR/MONITOR'S ACRONYM(S)

11. SPONSOR/MONITOR'S REPORT NUMBER(S)

12. DISTRIBUTION/AVAILABILITY STATEMENT

13. SUPPLEMENTARY NOTES

14. ABSTRACT

15. SUBJECT TERMS

16. SECURITY CLASSIFICATION OF: a. REPORT b. ABSTRACT c. THIS PAGE

17. LIMITATION OF ABSTRACT

18. NUMBER OF PAGES

19a. NAME OF RESPONSIBLE PERSON

19b. TELEPHONE NUMBER (Include area code)