The State Department is spending $5 million to build a database to track $47.5 billion in U.S. spending on Iraqi reconstruction projects.

Trouble is, by the time the database is up and running, almost all of the reconstruction funds will be spent, says a top auditor who is pressing the State Department to cancel the project as a waste of money.

"Replacing [the system] a year from now would not be a cost-beneficial way to track the small amount of U.S.-funded reconstruction projects that would remain after October 2010," when the project is expected to be finished, wrote special inspector general for Iraq reconstruction Stuart Bowen in a report released Tuesday.

It was Bowen who initially urged State in 2008 to launch a new version of the Iraq Reconstruction Management System (IRMS) to keep an accurate account of reconstruction spending. But the project has been plagued by delays and won't launch until October at the earliest, when more than 95 percent of the reconstruction funds are expected to be spent.

Further, most agencies involved in reconstruction do not use the existing IRMS to track and report their spending. The Defense Department uses the Army Corps of Engineers Financial Management System, while most State Department agencies and the U.S. Agency for International Development use the Foreign Assistance Coordination and Tracking System, Bowen said.

"These agencies question the need for a replacement IRMS system as it will only require additional work for them to enter data into the system which they will not use," he wrote in the report.

Two agencies that do use IRMS, the Iraq Transition Assistance Office and the Army Corps of Engineers Gulf Regional Division, are downsizing because operations in Iraq are winding down, making a new system all the more useless, he said.

State disagreed with the IG recommendation. In a letter to the IG office, Ambassador Patricia Haslach, assistant chief of mission for assistance transition at the U.S. Embassy in Baghdad, said the information a new system would track would still be useful.

The contractor working on the project is Enterprise Information Systems, based in Vienna, Va.