More oversight and better project selection are needed when U.S. military commanders dole out cash for projects in Iraq and Afghanistan, according to a Government Accountability Office report issued Monday.

The report raised concerns about the Commander’s Emergency Response Program, or CERP, which gives local commanders authority to hand out sometimes-large amounts of cash for programs categorized as relief and reconstruction.

But according to the GAO report, the amount handed out in Afghanistan and Iraq has grown from $179 million in fiscal 2004 to $1.1 billion in fiscal 2007. And the number of projects costing more than $500,000 has soared from 13 in fiscal 2004 to 276 in fiscal 2007 – accounting for nearly half of the actual project dollars approved that year.

In all, more than $3 billion in CERP funds have been approved for both Iraq and Afghanistan.

According to the report, the approved projects have ranged from "a waterline repair costing slightly more than $100 to an electrical distribution system costing more than $11 million."

In some areas, the CERP funds are used to pay so-called "Sons of Iraq" groups — armed civilian groups that have aligned themselves with the United States.Members of those groups are paid up to $300 in cash per month for their service in the groups.

Among the problems found by the GAO report: "neither [the Pentagon] nor [Multi-National Corps-Iraq] establishes a requirement for units executing projects to monitor them;" "no performance metrics exist for CERP;" and "limited visibility and oversight for projects costing less than $500,000."

CERP was established in 2003 and originally funded by seized Iraqi assets. In November 2003, though, Congress began appropriating the funds as part of the Emergency Supplemental Appropriations Act for Defense.

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