GAO: DOD wastes RFID tags

The Defense Department treats reusable active radio frequency identification (RFID) tags as disposable items, with $110 million worth of such tags purchased since 1997 used only once or twice, the Government Accountability Office reported.

DOD has used battery-powered active RFID tags, which cost $100 each and have a range of 300 feet, since the 1990s to track containers and large items, with a surge in use since the start of combat operations in Afghanistan in 2001 and Iraq in 2003.

Savi Technology supplies the tags to DOD. Last month, the Army increased the ceiling of its contract with Savi from $207.9 million to $424.5 million and extended the ordering period through Jan. 31, 2008.

Before the start of combat operations in Afghanistan and Iraq, 10 percent of active tags were returned for reuse. That number declined to 3 percent after the start of those operations, GAO’s report states.

DOD active tag use data from May 2002 through May 2005 shows that 614,861 tags out of an active inventory had been used only once or twice and only 100,226 were used more than twice, according to the report.

Officials from the Army and Defense Logistics Agency – the largest users of active tags – told GAO that they are unaware of the status or location of previously used tags, the report states. “Without greater efficiency in the reuse of active RFID tags, DOD could spend millions of dollars for unnecessary purchases” of tags, the GAO report states.

GAO recommended that DOD revise its RFID policy to require users to return active tags for reuse and to develop procedures to track and monitor their use.

DOD will issue new policy guidelines on the reuse of active RFID tags, Jack Bell, undersecretary of Defense for logistics and material readiness, said in a letter sent in response to GAO’s report. That new policy will cover the reuse of tags and procedures for returning them, Bell said.

GAO also recommended that DOD establish procedures for inventory, repairs and losses in the logistics system. Bell said the department does not agree with that recommendation, since it views tags as consumable items.

GAO said RFID tags do not meet the definition of consumable items contained in DOD regulations, which state that a consumable item is “normally expended or used up beyond recovery in the use for which it is designed or intended.”

The GAO said that definition does not cover the tags because they are designed for reuse and not expended or used up beyond recovery.

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