Aircraft Basing

Pursuant to a congressional request, GAO reviewed the Navy's life-cycle cost study to determine the adequacy of its decision to base its new E-6A aircraft at Tinker Air Force Base.

GAO found that the Navy: (1) projected life-cycle costs using constant fiscal year 1985 dollars; (2) did not consider the time value of money, although the expenditure rate over the 30-year period varied considerably according to location; (3) assessed the proper cost categories for expected differences and generally made reasonable assumptions; (4) did not document its assumption regarding how Tinker could absorb the staff years the project required; (5) assumed that Tinker would have certain facilities available for the aircraft, although another project was using the facilities and another project was considering the site; (6) did not estimate the cost of an increase in the number of military family housing units; (7) considered unquantifiable benefits such as Tinker's operations and maintenance experience with similar aircraft; and (8) believed that Tinker would cost $20.9 million less than another base and $76.6 million and $99.5 million less than two dual-basing options. GAO believes that: (1) although the Navy's life-cycle cost study lacks some precision, it, along with operational and strategic considerations, provides a reasonable basis for choosing the appropriate basing option; and (2) the actual cost differences between the four alternatives are small.