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The original objectives of this audit were to determine the effectiveness of the cost-control measures of DoD environmental remediation projects and to follow up on recommendations made in IG, DoD, Report No. 91-069, "Defense Environmental Restoration Program," April 2, 1991. After the audit began, the Assistant Secretary of the Navy (Installations and Environment) asked us to audit the CLEAN contracting method. In April 1992, we agreed to audit the CLEAN contract as it related to our original audit objectives. For the original objectives of this audit, we determined that the Military Departments adequately established cleanup requirements to comply with Federal law. We did not address cost-estimating procedures for environmental remediation projects for the Navy and Air Force because they used interagency agreements with the Department of Energy; a prior audit report recently covered the problems of using these interagency agreements. In addition, the Army effectively used modeling techniques for re-scoring environmental remediation projects to comply with Federal law as a cost-saving feature. Further, recent Federal and State agreements have greatly facilitated dealings with DoD agencies and Federal and State environmental regulatory agencies. Appendix A summarizes the implementation of prior audit report recommendations.