Military Bases

GAO reviewed the Pentagon's cost estimates and savings for base closures and realignments in 1988 and 1991. Although closure and realignment costs have so far remained relatively stable, land revenue projections have fallen dramatically. As a result, the Defense Department's (DOD) estimate of money needed for the Defense Base Realignment and Closure Account, which funds one-time costs to close or realign bases, more than doubled between fiscal years 1991 and 1993. There were also significant fluctuations in the components that make up the total estimated costs for the account. For example, the projection for military construction dropped from $2.2 billion to $1.5 billion, while the estimate for environmental cleanup rose from $510 million to $859 million. Operations and maintenance costs fell by about $33 million. The changes occurred because DOD now has better data to base its estimates on and because audits have shown that some construction costs were either too high or were unnecessary. Between fiscal years 1991 and 1993, estimated land sale revenues dropped from $2.1 billion to $1.1 billion because some properties were transferred to other federal agencies and local governments without compensation and because better data were obtained on what properties might sell for.

GAO found that: (1) estimated military construction costs have decreased by about one-third due to better construction data, greater force structure reductions than expected, and elimination of inappropriate costs; (2) environmental cleanup costs have increased significantly due to more extensive contamination; (3) operations and maintenance costs have decreased slightly due to situational changes and more current data; and (4) land sale revenues from base closures have been minimal and significantly less than expected due to uncompensated property transfers to other federal agencies and local governments, better information on property values, and more realistic estimates on which properties would sell.