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Army's Check Will Soon Be in Mail to Contractor

March 03, 1991

In the article "Red Tape Threatens Supply Pipeline to Gulf War" (Jan. 29), Ralph Vartabedian describes payment problems encountered by some U.S. manufacturers in connection with their shipments of Army orders to Saudi Arabia.

The article refers to the belief by some experts that contractors working with the Army will be "left in the lurch." A Temecula, Calif., firm, Central Power, was cited as well as the problems of its owner, James Vallely.

I am pleased to advise that Vallely is not being left in the lurch and there should never have been any expectation that he would be. The Army has contracted to obtain 22 generators from Central Power. Twelve of these have been shipped, and as I write, the Army has been billed for only eight.

The first payments, covering the eight units shipped, will be issued to Central Power next week. The Defense Department has to deal with a huge array of merchandise and a larger number of suppliers than any buying institution in the United States.

Buying regulations are in effect to protect the government and the taxpayer, and at the same time provide a measure of Defense Department internal management control. These regulations necessarily entail a substantial degree of complexity, although a major simplification of purchasing regulations is taking place.

I hope that the results of this effort will soon be apparent to Vallely and to others who provide valuable goods and services to the Defense Department and the Department of the Army.

MICHAEL P. W. STONE

Secretary of the Army

Washington

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