Military Base Closures
Assessment of DOD's 2004 Report on the Need for a Base Realignment and Closure Round Gao ID: GAO-04-760 May 17, 2004The Defense Base Realignment and Closure Act of 1990, as amended, required the Department of Defense (DOD) to address several base realignment and closure (BRAC) issues in 2004 for the 2005 BRAC round to proceed. The requirements included reporting on a 20-year force structure plan, an inventory of military installations, and separately adopting selection criteria for the upcoming round. The legislation also required DOD to certify whether an additional BRAC round was needed, and, if so, that annual net savings would be realized not later than fiscal year 2011. If the certifications were provided, GAO was required to evaluate DOD's submissions and report to Congress. DOD reported on March 23, 2004, and provided the certifications. In this report GAO evaluates (1) DOD's responsiveness to legislative requirements; (2) the force structure plan, infrastructure inventory, and selection criteria; (3) other key issues included in DOD's report; and (4) DOD's certification regarding the need for an additional BRAC round.
DOD's report to Congress generally addressed all legislative reporting requirements in section 2912 of the Defense Base Realignment and Closure Act of 1990, as amended, and separately complied with requirements under Section 2913 in adopting selection criteria to guide BRAC decision making. The degree of coverage on some reporting requirements was limited to avoid prejudging the ongoing analytical process for the 2005 round. As directed, GAO analyzed DOD's worldwide installation inventory, force structure plan, and selection criteria. While all three are important in setting a framework for the BRAC process, the latter two figure prominently in guiding DOD's analyses for the 2005 round. The unclassified portion of the 20-year force structure plan, extending through 2009, provides a macro-level focus (e.g., number of Army divisions), and reflects limited changes across the military services, even though the services have initiatives under way that could affect future force structure and infrastructure requirements. Today's security environment is evolving, as are force structure requirements along with technology advancements, and defense transformation efforts. The department must consider these factors in its BRAC analyses with appropriate allowances for future uncertainties. DOD's selection criteria closely parallel criteria used in previous rounds, while incorporating the provisions required by legislation authorizing the 2005 round. The analytical sufficiency of the criteria will best be assessed through their application in the ongoing BRAC process. GAO addressed other BRAC-related issues such as excess defense infrastructure capacity and BRAC savings because of their importance to DOD's certification of need for the 2005 BRAC round. DOD's excess capacity analysis, completed for the 2004 report, has some limitations that could result in either overstating or understating excess capacity across various functional areas, and make it difficult to project a total amount of excess capacity across DOD. While the analysis gives some indications of excess capacity within the department, the issue warrants a more complete assessment in the BRAC process. That process will also consider joint base use with the potential for better identifying excess capacity. DOD's historical financial data suggest that, assuming conditions similar to those in the 1993 and 1995 rounds, each of the military departments could achieve annual net savings by 2011, as stipulated by the mandate. While the potential exists for substantial savings from the upcoming round, it is difficult to conclusively project the expected magnitude of the savings because there are too many unknowns at this time. Additionally, improvements are needed in DOD's accounting for savings after BRAC decisions are made. GAO found no basis to question DOD's certification of the need for an additional BRAC round. While clear limitations exist in DOD's assessment of excess capacity, it does point to some areas that warrant additional analysis-and the current BRAC process is an appropriate forum for doing so.
RecommendationsOur recommendations from this work are listed below with a Contact for more information. Status will change from "In process" to "Open," "Closed - implemented," or "Closed - not implemented" based on our follow up work.
Director: Team: Phone:GAO-04-760, Military Base Closures: Assessment of DOD's 2004 Report on the Need for a Base Realignment and Closure Round
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Report to Congressional Committees:
United States General Accounting Office:
GAO:
May 2004:
Military Base Closures:
Assessment of DOD's 2004 Report on the Need for a Base Realignment and
Closure Round:
GAO-04-760:
GAO Highlights:
Highlights of GAO-04-760, a report to congressional committees
Why GAO Did This Study:
The Defense Base Realignment and Closure Act of 1990, as amended,
required the Department of Defense (DOD) to address several base
realignment and closure (BRAC) issues in 2004 for the 2005 BRAC round
to proceed. The requirements included reporting on a 20-year force
structure plan, an inventory of military installations, and separately
adopting selection criteria for the upcoming round. The legislation
also required DOD to certify whether an additional BRAC round was
needed, and, if so, that annual net savings would be realized not later
than fiscal year 2011. If the certifications were provided, GAO was
required to evaluate DOD‘s submissions and report to Congress. DOD
reported on March 23, 2004, and provided the certifications.
In this report GAO evaluates (1) DOD‘s responsiveness to legislative
requirements; (2) the force structure plan, infrastructure inventory,
and selection criteria; (3) other key issues included in DOD's report;
and (4) DOD‘s certification regarding the need for an additional BRAC
round.
What GAO Found:
DOD‘s report to Congress generally addressed all legislative reporting
requirements in section 2912 of the Defense Base Realignment and
Closure Act of 1990, as amended, and separately complied with
requirements under Section 2913 in adopting selection criteria to guide
BRAC decision making. The degree of coverage on some reporting
requirements was limited to avoid prejudging the ongoing analytical
process for the 2005 round.
As directed, GAO analyzed DOD‘s worldwide installation inventory, force
structure plan, and selection criteria. While all three are important
in setting a framework for the BRAC process, the latter two figure
prominently in guiding DOD‘s analyses for the 2005 round. The
unclassified portion of the 20-year force structure plan, extending
through 2009, provides a macro level focus (e.g., number of Army
divisions), and reflects limited changes across the military services,
even though the services have initiatives under way that could affect
future force structure and infrastructure requirements. Today‘s
security environment is evolving, as are force structure requirements
along with technology advancements, and defense transformation efforts.
The department must consider these factors in its BRAC analyses with
appropriate allowances for future uncertainties. DOD‘s selection
criteria closely parallel criteria used in previous rounds, while
incorporating the provisions required by legislation authorizing the
2005 round. The analytical sufficiency of the criteria will best be
assessed through their application in the ongoing BRAC process.
GAO addressed other BRAC-related issues such as excess defense
infrastructure capacity and BRAC savings because of their importance to
DOD‘s certification of need for the 2005 BRAC round. DOD‘s excess
capacity analysis, completed for the 2004 report, has some limitations
that could result in either overstating or understating excess capacity
across various functional areas, and make it difficult to project a
total amount of excess capacity across DOD. While the analysis gives
some indications of excess capacity within the department, the issue
warrants a more complete assessment in the BRAC process. That process
will also consider joint base use with the potential for better
identifying excess capacity. DOD‘s historical financial data suggest
that, assuming conditions similar to those in the 1993 and 1995 rounds,
each of the military departments could achieve annual net savings by
2011, as stipulated by the mandate. While the potential exists for
substantial savings from the upcoming round, it is difficult to
conclusively project the expected magnitude of the savings because
there are too many unknowns at this time. Additionally, improvements
are needed in DOD‘s accounting for savings after BRAC decisions are
made.
GAO found no basis to question DOD‘s certification of the need for an
additional BRAC round. While clear limitations exist in DOD‘s
assessment of excess capacity, it does point to some areas that warrant
additional analysis-and the current BRAC process is an appropriate
forum for doing so.
What GAO Recommends:
This report includes a recommendation for executive action by DOD and a
matter for congressional consideration to strengthen the BRAC process.
In commenting on a draft of this report, DOD agreed with the report
contents.
www.gao.gov/cgi-bin/getrpt?GAO-04-760.
To view the full product, including the scope and methodology, click on
the link above. For more information, contact Barry W. Holman at (202)
512-8412 or holmanb@gao.gov.
[End of section]
Contents:
Letter:
Results in Brief:
Background:
DOD's Report Generally Addressed All of the Legislatively Required
Information:
Worldwide Installation Inventory, Force Structure Plan, and Selection
Criteria:
Observations on Other Key BRAC-Related Issues Included in
DOD's Report:
Certification of the Need for an Additional BRAC Round:
Conclusion:
Recommendation for Executive Action:
Matter for Congressional Consideration:
Agency Comments:
Appendix I: Scope and Methodology:
Appendix II: BRAC 2005 Timeline:
Appendix III: GAO's Letter on Draft Selection Criteria for the 2005 Base
Closure Round:
Appendix IV: DOD's Methodology for Estimating Excess Capacity:
Appendix V: Key Points from Prior GAO Products Regarding the Need for an
Additional BRAC Round:
Appendix VI: Comments from the Department of Defense:
Appendix VII: Key Prior GAO Reports on DOD's Base Realignments
and Closures:
Appendix VIII: GAO Contacts and Staff Acknowledgments:
Tables:
Table 1: GAO Assessment of DOD's Responsiveness to Legislative
Requirements in its Section 2912 Report to Congress:
Table 2: DOD's 20-year Force Structure Plan (unclassified portion
through fiscal year 2009):
Table 3: Comparison of BRAC Criteria for the 1995 Round and Those
Adopted for the 2005 Round:
Table 4: Net Annual Savings In the Sixth Year of Implementation for
BRAC 1993 and 1995 Rounds by Military Department:
Table 5: Army Analysis of Proportional Capacity:
Table 6: Estimated Percentage of Excess Capacity:
Abbreviations:
BRAC: base realignment and closure:
CBO: Congressional Budget Office:
DLA: Defense Logistics Agency:
DOD: Department of Defense:
OSD: Office of the Secretary of Defense:
United States General Accounting Office:
Washington, DC 20548:
May 17, 2004:
Congressional Committees:
While the Department of Defense (DOD) continues its work in preparing
for the upcoming base realignment and closure (BRAC) round in 2005,
legislation[Footnote 1] required DOD to report to Congress on several
BRAC-related issues in 2004 in order for the 2005 round to proceed. The
legislation directed, among other things, that the Secretary of Defense
provide Congress with a 20-year force structure plan and a worldwide
inventory of military installations in its submission of its fiscal
year 2005 budget documentation and separately publish the final
selection criteria for the 2005 BRAC round no later than February 16,
2004. Of particular importance was the requirement that the Secretary
of Defense certify the need for additional base realignments and
closures and, if such a need exists, certify that annual net savings
would be realized by each military department not later than fiscal
year 2011. DOD published its final selection criteria on February 12,
2004, and reported on the other legislative requirements, including the
necessary certifications, on March 23, 2004.[Footnote 2] The
legislation also directed us, if DOD's certifications were provided, to
submit a report to Congress, within 60 days of the issuance of DOD's
report, evaluating specific aspects of DOD's legislatively required
submissions.
In this report, we evaluate (1) DOD's responsiveness to the legislative
reporting requirements; (2) the force structure plan, infrastructure
inventory, and final selection criteria for the 2005 BRAC round,
including, as appropriate, observations on the relative analytical
sufficiency and accuracy of each; (3) other key BRAC-related issues
included in DOD's report, such as excess infrastructure capacity,
estimated savings, and the economic impact of BRAC on nearby
communities; and (4) the Secretary's certification regarding the need
for an additional BRAC round. While the mandate did not direct us to
address the third objective, we chose to include this information
because of widespread interest in the 2005 BRAC process among Congress
and the public and its relevance to the Secretary's certification of
the need for the 2005 BRAC round.
In performing our review, we conducted work at the BRAC Office in the
Office of the Deputy Under Secretary of Defense for Installations and
Environment and the Army, Navy, and Air Force BRAC offices. We also
relied on our previous and ongoing work on BRAC-related issues. Because
we were required to report within 2 months after DOD issued its report,
we did not have time to fully assess the accuracy of all data used in
the report; but we did perform limited reliability assessments of key
data contained in DOD's report and determined that the data were
sufficiently reliable for the purposes of this report with relevant
limitations noted in our report. We performed our work from March to
May 2004 in accordance with generally accepted government auditing
standards. Further information on our scope and methodology appears in
appendix I.
Results in Brief:
DOD's report to Congress generally addressed all of the requirements in
section 2912 of the Defense Base Closure and Realignment Act of 1990,
as amended, and separately complied with the requirements in section
2913 for adopting selection criteria to guide BRAC decision making.
According to DOD officials, the degree of coverage on some reporting
requirements, such as the impact of joint basing and the extent of
excess capacity, was limited in order to avoid preempting or prejudging
the ongoing analytical process for the 2005 BRAC round.
While the worldwide military installation inventory, 20-year force
structure plan, and selection criteria are important in setting a
framework for the BRAC process, the latter two figure prominently in
guiding DOD's analyses for the 2005 round. The worldwide inventory
extends well beyond that required for the domestic BRAC
process,[Footnote 3] which focuses on a smaller subset of the
inventory. The unclassified portion of the 20-year force structure plan
covers only the 2005 through 2009 time period and provides more of a
macro-level focus (e.g., number of Army divisions). The plan depicts
little change in the force structure through that period, even though
the services have a number of initiatives underway that could affect
force structure and infrastructure requirements. DOD's ongoing BRAC
analysis, however, will need to consider the impact of this and other
potential future force structure changes on infrastructure
requirements. Further, as provided in the legislation, DOD has an
opportunity to update the plan with its fiscal year 2006 budget
submission in February 2005, which would be expected prior to the
Secretary's announcement of his proposed closure and realignment
recommendations in May 2005. DOD's selection criteria for the 2005
round, while incorporating the requirements required by legislation
authorizing the 2005 round, closely parallel the criteria that provided
a solid foundation for BRAC analyses conducted in previous rounds. Even
so, the analytical sufficiency of the criteria will best be assessed
through their application, as DOD completes its data collection and
analyses for the upcoming round.
Other BRAC-related issues--excess defense infrastructure, estimated
savings, and community impact from BRAC actions--have historically been
and continue to be areas of widespread interest to Congress and the
public in considering the need for another BRAC round. DOD's analysis
of excess infrastructure capacity, which was completed for the 2004
report outside the BRAC process, has some limitations that could result
in either overstating or understating the amount of excess capacity
across various functional areas, and make it difficult to project a
total amount of excess capacity across DOD. While the analysis gives
some indication of excess capacity within the department, the issue
warrants a more complete assessment in the official BRAC process.
Moreover, in completing this analysis, the military services assessed
their bases as though they were being used for a single function, and
did not consider existing or the potential for increased multi-
functional/joint use that is expected to be considered in the 2005 BRAC
round--and provides the potential for better identifying excess
capacity. As to estimated savings, DOD's historical financial data
suggest that, assuming conditions similar to those in the 1993 and 1995
rounds, each of the military departments could achieve annual net
savings in the 2005 round by fiscal year 2011, as stipulated by the
mandate. While the potential exists for substantial savings and
efficiencies to result from the BRAC 2005 round, it is difficult to
conclusively project levels of expected savings from the 2005 round.
There are too many unknowns at this time, such as the timing of
individual closure or realignment actions, and the implementation costs
that may be required. Further, important differences exist in the
upcoming round, compared with prior rounds that could affect costs and
savings. For example, this round has a greater focus on supporting
force transformation and the potential need to support stateside
redeployment of some forces currently based overseas as a result of
separately ongoing overseas basing reviews. Additionally, we have
previously noted the need for improvements in DOD's tracking and
periodic updating of savings estimates from BRAC recommendations once
they have been approved and are being implemented. DOD needs to firm up
plans to implement previously proposed improvements as it moves forward
with the 2005 BRAC round. As to economic impact, the department's
report recognized that BRAC actions can affect the local economies of
the surrounding communities but also notes that it has sought to
minimize any adverse local impacts with a coordinated program of
federal assistance from both DOD and domestic agencies. Our work has
shown that many communities surrounding closed bases from the previous
rounds have fared better than the national average, in terms of changes
in unemployment rates and per capita income, with more mixed results
recently, allowing for some negative impact from the economic downturn
in recent years.
Although we identified some limitations with DOD's assessment of excess
capacity and factors that could affect the timing and amount of savings
from a future BRAC round, we found no basis to question DOD's
certification of the need for an additional BRAC round. As directed by
DOD, the upcoming round is expected to encompass more than a
capacity-reduction and cost-savings effort; rather, it is also an
effort to align the defense infrastructure with the transformation of
its forces. Further, the need for an additional BRAC round has long
been recognized by various defense officials and studies--and noted in
several of our products since the time of the 1995 BRAC round.
This report contains a recommendation to the Secretary of Defense to
strengthen the BRAC analytical process, documenting allowance for
future force structure and surge requirements, and a matter for
congressional consideration to ensure steps are taken by DOD to improve
the accounting for savings from BRAC decisions. In commenting on a
draft of this report, DOD agreed with the report contents.
Background:
The National Defense Authorization Act for Fiscal Year 2002[Footnote 4]
extended the authority of the 1990 BRAC legislation, with some
modifications, to authorize an additional BRAC round in 2005. Under
section 2912 of the 1990 Act and as part of its fiscal year 2005 budget
submission, DOD was required to submit a 20-year force structure plan,
an infrastructure inventory, and a certification that additional
closures and realignments were needed and that annual net savings would
be achieved for each military department by fiscal year 2011. The force
structure plan was to be based on assessments by the Secretary of
Defense of the probable threats to national security between fiscal
years 2005 and 2025. Furthermore, the plan was to be based on the
probable end strengths and major military force units (land divisions,
carrier and other major combatant vessels, and air wings) needed to
meet these threats. DOD was also required to prepare a comprehensive
inventory of military installations worldwide that indicated the number
and type of facilities in the active and reserve forces of each
military department.
Using the force structure plan and the infrastructure inventory, the
Secretary of Defense's submission to Congress was required to address
(1) the inventory necessary to support the force structure, (2) the
categories of excess infrastructure and infrastructure capacity, and
(3) an economic analysis of the effect of the closure or realignment of
military installations to reduce excess capacity. In analyzing the
infrastructure requirements, DOD was to consider the continuing need
for and availability of military installations outside the United
States and any efficiency that may be gained from joint tenancy by more
than one branch of the Armed Forces on military bases. On the basis of
the force structure plan, the infrastructure inventory and the economic
analysis, the Secretary was required to certify whether the need
existed for further closures and realignments and, if so, that an
additional round would result in annual net savings for each military
department, beginning not later than 2011. Collectively, these
requirements were to be addressed in a report to Congress at the time
it submitted its fiscal year 2005 budget justification documentation.
The legislation also stipulated that if the certifications were
provided in DOD's report to Congress, we were to evaluate the force
structure plan, infrastructure inventory, and the final selection
criteria, and the need for an additional BRAC round. We were required
to issue a report not later than 60 days after DOD submitted its report
to Congress.
Section 2913 of the 1990 Act, as amended, also required the Secretary
of Defense to publish in the Federal Register the selection criteria
for use in the BRAC 2005 round and to provide an opportunity for public
comment. The legislation required that military value be the primary
criteria for making recommendations to close or realign military
installations, and directed inclusion of a number of considerations in
formulating the selection criteria. The proposed selection criteria
were published on December 23, 2003, with a public comment period
ending January 30, 2004. The final criteria were published on February
12, 2004. We were also required by the legislation to evaluate the
final selection criteria as part of our overall assessment of DOD's
reporting on BRAC issues in 2004. This is in keeping with GAO's
longstanding role as an independent, objective observer of the BRAC
process.
Legislation authorizing the 2005 round continued the previous
legislative requirement, applicable to earlier BRAC rounds that we
review the Secretary's recommendations and selection process; it
requires us to report to the congressional defense committees no later
than July 1, 2005, 45 days after the last date by which the Secretary
must transmit to the congressional defense committees and the BRAC
Commission his recommendations for closures and realignments.[Footnote
5] To make an informed and timely assessment, we have consistently
operated in a real-time setting and have had access to significant
portions of the process as it has evolved, thus affording the
department an opportunity to address any concerns we raised on a timely
basis. From our vantage point, we are looking to see to what extent DOD
follows a clear, transparent, consistently applied process, where we
can see a logical flow between DOD's analysis and its decision making.
DOD's Report Generally Addressed All of the Legislatively Required
Information:
DOD's report to Congress generally addressed all of the requirements in
section 2912 of the Defense Base Closure and Realignment Act of 1990,
as amended, and separately complied with the requirements in section
2913 for adopting selection criteria to guide BRAC decision making. In
some instances, according to DOD officials there were limitations in
the data provided in DOD's Section 2912 report in order to avoid
preempting or prejudging the ongoing analytical process for the 2005
BRAC round. Table 1 details the legislative requirements for DOD's
Section 2912 report, indicates the pages in DOD's report where the
issues are addressed, and provides our observations on the extent to
which DOD provided the information required by each subsection in the
legislation.
Table 1: GAO Assessment of DOD's Responsiveness to Legislative
Requirements in its Section 2912 Report to Congress:
Section 2912 citation: Force structure plan and worldwide
installation inventory: (a)(1)(A);
Legislative requirement: A force structure plan for the Armed Force
based on an assessment by the Secretary of the probable threats to
national security during the 20-year period beginning with fiscal year
2005, the probable end strengths and major military force units
(including land force divisions, carrier and other major combatant
vessels, air wings, and other comparable units) needed to meet these
threats, and the anticipated levels of funding that will be available
for national defense purposes during such period;
DOD report citations: Section 2, pp. 17-23;
GAO assessment of information provided: DOD provided an unclassified
force structure plan through fiscal year 2009 and a separate classified
force structure plan through fiscal year 2024.
Section 2912 citation: Force structure plan and worldwide
installation inventory: (a)(1)(B);
Legislative requirement: A comprehensive inventory of military
installations worldwide for each military department, with
specifications of the number and type of facilities in the active and
reserve forces of each department;
DOD report citations: Section 3, pp. 25-35. App. B, compact disk;
GAO assessment of information provided: DOD provided a worldwide
inventory of installations, but the inventory did not include all
overseas installations where U.S. forces are deployed.
Section 2912 citation: Force structure plan and worldwide
installation inventory: (a)(2)(A);
Legislative requirement: A description of the infrastructure necessary
to support the force structure described in the force structure plan;
DOD report citations: Section 6, pp. 43-54;
GAO assessment of information provided: DOD broadly compared the
infrastructure required to support the force structure for certain
functional areas through fiscal year 2009 (and not 2024) without
specificity concerning infrastructure requirements.
Section 2912 citation: Force structure plan and worldwide
installation inventory: (a)(2)(B);
Legislative requirement: A discussion of categories of excess
infrastructure and infrastructure capacity;
DOD report citations: Section 6, pp. 43-54;
GAO assessment of information provided: DOD provided the required
information for selected functional areas, but the excess capacity
methodology has some limitations.
Section 2912 citation: Force structure plan and worldwide
installation inventory: (a)(2)(C);
Legislative requirement: An economic analysis of the effect of the
closure or realignment of military installations to reduce excess
infrastructure;
DOD report citations: Section 7, pp. 55-62;
GAO assessment of information provided: DOD provided information on the
savings realized from the previous BRAC rounds and the reuse of
selected former bases.
Section 2912 citation: Force structure plan and worldwide
installation inventory: (a)(3)(A);
Legislative requirement: The anticipated continuing need for and
availability of military installations outside the United States,
taking into account current restrictions on the use of military
installations outside the United States and the potential for future
prohibitions or restrictions on the use of such military installations;
DOD report citations: Section 4, pp. 37-40;
GAO assessment of information provided: DOD provided a general
discussion on the need for the availability of a worldwide network of
bases, operating locations, and access arrangements, but no specific
information on the continuing need for or restrictions on the use of
specific bases.
Section 2912 citation: Force structure plan and worldwide
installation inventory: (a)(3)(B);
Legislative requirement: Any efficiencies that may be gained from joint
tenancy by more than one branch of the Armed Forces at a military
installation;
DOD report citations: Section 5, p. 41;
GAO assessment of information provided: DOD did not identity specific
efficiencies but emphasized that joint basing is a priority for the
2005 BRAC round.
Section 2912 citation: Certifications of need for further closures and
realignments and requisite savings: (b)(1)(A);
Legislative requirement: Certification regarding whether the need
exists for the closure or realignment of additional military
installations;
DOD report citations: Cover letter;
GAO assessment of information provided: DOD provided the required
certification.
Section 2912 citation: Certifications of need for further closures and
realignments and requisite savings: (b)(1)(B);
Legislative requirement: Certification that the additional round of
closures and realignments would result in annual net savings for each
of the military departments beginning not later than fiscal year 2011;
DOD report citations: Cover letter;
GAO assessment of information provided: DOD provided the required
certification.
Source: GAO analysis of DOD's Report Required by Section 2912 of the
Defense Base Closure and Realignment Act of 1990, as amended through
the National Defense Authorization Act for Fiscal Year 2003, March
2004.
[End of table]
Likewise, as discussed in a subsequent section, DOD also complied with
the requirements of Section 2913 in adapting its selection criteria for
the 2005 BRAC round.
Worldwide Installation Inventory, Force Structure Plan, and Selection
Criteria:
While DOD's worldwide military installation inventory, 20-year force
structure plan, and selection criteria are all important in setting a
framework for the BRAC process, the latter two figure prominently in
guiding BRAC analyses for the 2005 round. Although DOD provided a
worldwide inventory of installations and facilities for each military
department as required by the legislation, it exceeds the needs of the
2005 BRAC process, which focuses on domestic bases.[Footnote 6]
Further, to the extent one looks to the inventory as providing a total
accounting of DOD facilities worldwide, it should be noted that the
inventory lacks completeness in that not all overseas installations and
associated facilities where U.S. forces are deployed are included--
primarily because some are considered temporary in nature. The
unclassified portion of the force structure plan, extending through
2009, has more of a macro-level focus reflecting limited change across
the military services, even though the services have a number of
initiatives under way that could affect force structure and
infrastructure requirements. Nevertheless, DOD's ongoing BRAC
analysis will need to consider the impact of such changes on
infrastructure requirements. The department's final selection
criteria, although incorporating legislatively directed language,
essentially follows a framework similar to that employed in prior BRAC
rounds. The full analytical sufficiency of the criteria will best be
assessed through their application, as DOD completes its data
collection and analysis for the 2005 round.
Worldwide Installation Inventory Provided but Extended Beyond
Requirements for 2005 BRAC Round:
As required by the legislation, DOD provided a worldwide inventory of
installations, which included the number and type of facilities in the
active and reserve forces. While the inventory provides a detailed
listing of facilities, it extends beyond the needs of the 2005 BRAC
round with its focus on domestic installations. At the same time, it
has some limitations in terms of a complete inventory for use beyond
BRAC because it does not include all overseas installations. For
example, the inventory omits various installations and associated
facilities located in parts of the Middle East, such as Iraq,
Afghanistan, and Kuwait. DOD and military service officials told us
that these installations are considered temporary or classified in
support of contingency operations, and are not included in the database
used to generate the inventory. This limitation should not impact the
conduct of the 2005 BRAC round since the focus is on domestic bases,
and DOD has identified the domestic bases in the database to assess in
the BRAC 2005 round.
The inventory of installations and facilities was derived from DOD's
Facilities Assessment Database, which is updated annually from the
military services' real property databases.[Footnote 7] Because of time
constraints, we performed only limited work on the accuracy of the
inventory. Contractors who maintain the Facilities Assessment Database
told us that since 1998 they have validated and verified facility data
annually by performing data queries--such as verifying the size of
buildings or the year a facility was acquired or built--to identify
anomalies in the data. Contractor officials stated the queries have
been successful in correcting erroneous data reported by the services
and that the quality of the data has improved since 1998.
No Major Force Structure Changes Identified through Fiscal Year 2009 in
DOD's 20-Year Force Structure Plan:
As with prior BRAC rounds, DOD has provided Congress with a force
structure plan that will guide or inform BRAC decisions in 2005, except
legislation authorizing the 2005 BRAC round required development of a
20-year plan instead of a 6-year plan required in prior rounds. DOD's
Section 2912 report contains the unclassified portion of DOD's 20-year
plan extending through fiscal year 2009; the remaining years of the
plan are addressed in a classified annex to the report. The
unclassified report provides more of a macro-level focus (e.g., number
of Army divisions) reflecting limited changes across the military
services, even though the services have a number of initiatives under
way that could affect force structure and infrastructure requirements,
and which will need to be considered by DOD as it performs its 2005
round analyses. DOD has the option of modifying its force structure
plan, as needed, with its fiscal year 2006 budget submission which
would be expected prior to its issuance of BRAC recommendations.
Table 2 summarizes DOD's force structure plans at the macro-level
through 2009 by service force units and by end strength. It depicts
limited changes in force units and end strength for active and reserve
components of most services. Exceptions include the Navy, which expects
to reduce personnel but increase the number of ships in its inventory,
and the Air Force, which plans a slight increase in reserve personnel
end strength.
Table 2: DOD's 20-year Force Structure Plan (unclassified portion
through fiscal year 2009):
Service force units: Army divisions; Active;
Fiscal year: 2005: 10;
Fiscal year: 2009: 10;
Change: None.
Service force units: Army divisions; Reserve;
Fiscal year: 2005: Aircraft carriers: 8;
Fiscal year: 2009: Aircraft carriers: 8;
Change: Aircraft carriers: None.
Service force units: Aircraft carriers;
Fiscal year: 2005: 12;
Fiscal year: 2009: 12;
Change: None.
Service force units: Carrier air wings; Active;
Fiscal year: 2005: 10;
Fiscal year: 2009: 10;
Change: None.
Service force units: Carrier air wings; Reserve;
Fiscal year: 2005: 1;
Fiscal year: 2009: 1;
Change: None.
Service force units: Battle force ships;
Fiscal year: 2005: 332;
Fiscal year: 2009: 347;
Change: 15.
Service force units: Air and Space Expeditionary Forces;
Fiscal year: 2005: 10;
Fiscal year: 2009: 10;
Change: None.
Service force units: Marine Corps divisions; Active;
Fiscal year: 2005: 3;
Fiscal year: 2009: 3;
Change: None.
Service force units: Marine Corps divisions;
Fiscal year: 2005: 1;
Fiscal year: 2009: 1;
Change: None.
End strength (in thousands): Army; Active[A];
Fiscal year: 2005: 482;
Fiscal year: 2009: 482;
Change: None.
End strength (in thousands): Army; Reserve;
Fiscal year: 2005: 555;
Fiscal year: 2009: 555;
Change: None.
End strength (in thousands): Navy; Active;
Fiscal year: 2005: 366;
Fiscal year: 2009: 357;
Change: (9).
End strength (in thousands): Navy; Reserve;
Fiscal year: 2005: 83;
Fiscal year: 2009: 76;
Change: (7).
End strength (in thousands): Marine Corps; Active;
Fiscal year: 2005: 175;
Fiscal year: 2009: 175;
Change: None.
End strength (in thousands): Marine Corps; Reserve;
Fiscal year: 2005: 40;
Fiscal year: 2009: 40;
Change: None.
End strength (in thousands): Air Force; Active;
Fiscal year: 2005: 360;
Fiscal year: 2009: 360;
Change: None.
End strength (in thousands): Air Force; Reserve;
Fiscal year: 2005: 183;
Fiscal year: 2009: 184;
Change: 1.
Source: DOD Report Required by Section 2912 of the Defense Base Closure
and Realignment Act of 1990, as amended though the National Defense
Authorization Act for Fiscal Year 2003, March 2004.
[A] The Army end strength figures do not reflect the temporary increase
of 30,000 spaces for fiscal year 2004 through fiscal year 2007 to
accelerate the Army transformation process while remaining fully
engaged in worldwide operations.
[End of table]
While the Army showed no force structure changes through 2009, Army
officials told us that they have a number of initiatives under way that
may affect the force structure and related infrastructure requirements.
Specifically, the Army is restructuring the way it organizes its forces
to achieve greater flexibility by increasing the number of brigade
combat teams from 33 to 43 or more. To achieve these goals while
maintaining global commitments, the Army has been authorized by the
Secretary of Defense to temporarily increase its end strength by 30,000
personnel through fiscal year 2007. Congress is considering legislation
to permanently authorize this increase. In addition, the Army is in the
process of rebalancing capabilities between the active and reserve
components by moving certain early-deploying and high-demand
capabilities such as military police and civil affairs from the reserve
components into the active force. Although the BRAC statute allows DOD
to submit a revised force structure plan with the fiscal year 2006
budget submission, Army officials told us that many of the details
about this restructuring would not be completed by this timeframe.
Navy officials told us that their plans include the commissioning of 17
new ships (13 Arleigh Burke destroyers, 2 submarines, 1 amphibious
ship, and 1 littoral combat ship) while decommissioning 2 older ships.
Navy officials indicated that the projected reductions in the number of
active personnel result primarily from decommissioning ships and air
squadrons and changes to crew requirements on some ships, and the
projected reduction in reserve personnel is caused primarily by plans
to deactivate 7 maritime patrol squadrons. Navy officials also noted
plans to increase the number of ships in its inventory in future years
but also have efforts under way to reduce average crew size per ship.
Although the force structure plan shows a planned increase in the
number of ships, available information indicates some uncertainty over
the total number of ships the Navy may expect for its future force
structure.
Air Force end strength levels shown in the force plan reflect
authorized levels and not the current over-strength levels, reflecting
Air Force expectations of reducing the current levels to those
authorized. While the Air Force showed minimal force structure changes
through 2009, an Air Force official stated that the service plans to
increase the number of aircraft per squadron as well as increase crew
ratios to make more effective use of fewer but more capable aircraft,
which would most likely reduce future infrastructure requirements. We
have previously reported[Footnote 8] that the Air Force could not only
reduce infrastructure by increasing the number of aircraft per fighter
squadron but could also save millions of dollars annually by doing so.
We recognize that developing a 20-year force structure plan is a
challenging task for the department, given a host of uncertainties
about the future security environment, potential technology advances
and their application to the future force, and ongoing departmental
transformation efforts. The uncertainties are evident in various
ongoing defense programs. While increased use of unmanned aerial
vehicles, for example, could have far-reaching effects for future
defense force structure, we noted in a recent report that DOD's
approach to planning for developing and fielding this capability does
not provide reasonable assurance that its investment will facilitate
the integration of these vehicles into the force structure
efficiently.[Footnote 9] Further, DOD officials told us that another
challenging aspect of its force structure planning resides in the
longer term (those years beyond 2009) of the plan. In addition to the
uncertainties cited above, these longer-term years are characterized by
additional unknowns regarding future funding levels that could impact
the future force structure and associated requirements, such as the
total number of ships for the Navy. Despite these inherent
uncertainties, however, the department must factor in relevant
assumptions about potential future force structure changes and surge
requirements as it performs its analyses for the upcoming BRAC round.
Final Selection Criteria Address Legislative Requirements and Provide
Sound Framework for Follow-on BRAC Analyses:
The department's final selection criteria essentially follow a
framework similar to that employed in prior BRAC rounds, with
specificity added in selected areas in response to requirements
contained in legislation authorizing the 2005 BRAC round. The Defense
Base Closure and Realignment Act of 1990, as amended in 2002, required
DOD to give priority to selection criteria dealing with military value,
including (1) the impact on joint war fighting, training, and
readiness; (2) the availability and condition of training areas
suitable for maneuver by ground, naval, or air forces throughout
diverse climates and terrains and staging areas for use by the Armed
Forces in homeland defense missions; and (3) the ability to accommodate
contingency, mobilization, and future force requirements. The
legislation also required DOD to give special consideration to other
criteria, many of which parallel those used in prior BRAC rounds.
Furthermore, the legislation required DOD to consider cost impacts to
other federal entities as well as to DOD in its BRAC decision making.
Additionally, the National Defense Authorization Act for Fiscal Year
2004[Footnote 10] requires DOD to consider surge requirements in the
2005 BRAC process. Table 3 compares the 1995 BRAC criteria with that
adopted for 2005, with changes highlighted in bold.
Table 3: Comparison of BRAC Criteria for the 1995 Round and Those
Adopted for the 2005 Round:
Military Value;
Criteria for 1995 Round: 1. The current and future mission requirements
and the impact on operational readiness of DOD's total force;
Criteria for 2005 Round: The current and future mission capabilities
and the impact on operational readiness of the Defense Department's
total force, including the impact on joint warfighting, training, and
readiness.
Military Value;
Criteria for 1995 Round: 2. The availability and condition of land,
facilities, and associated airspace at both the existing and potential
receiving locations;
Criteria for 2005 Round: The availability and condition of land,
facilities, and associated airspace--including training areas suitable
for maneuver by ground, naval, or air forces throughout diversity of
climate and terrain areas and staging areas for the use of the Armed
Forces in homeland defense missions--at both existing and potential
receiving locations.
Military Value;
Criteria for 1995 Round: 3. The ability to accommodate contingency,
mobilization, and future total force requirements at both the existing
and potential receiving locations;
Criteria for 2005 Round: The ability to accommodate contingency,
mobilization, and future total force requirements at both existing and
potential receiving locations to support operations and training.
Military Value;
Criteria for 1995 Round: 4. Cost and manpower implications;
Criteria for 2005 Round: The cost of operations and the manpower
implications.
Return on Investment;
Criteria for 1995 Round: 5. The extent and timing of potential costs
and savings, including the number of years, beginning with the date of
completion of the closure or realignment, for the savings to exceed the
costs;
Criteria for 2005 Round: The extent and timing of potential costs and
savings, including the number of years, beginning with the date of
completion of the closure or realignment, for the savings to exceed the
costs.
Community Impacts;
Criteria for 1995 Round: 6. The economic impact on communities;
Criteria for 2005 Round: The economic impact on existing communities in
the vicinity of military installations.
Community Impacts;
Criteria for 1995 Round: 7. The ability of both the existing and
potential receiving communities' infrastructures to support forces,
missions, and personnel;
Criteria for 2005 Round: The ability of both the existing and potential
receiving communities' infrastructure to support forces, missions, and
personnel.
Community Impacts;
Criteria for 1995 Round: 8. The environmental impact;
Criteria for 2005 Round: The environmental impact, including the impact
of costs related to potential environmental restoration, waste
management, and environmental compliance activities.
Source: DOD.
Note: Bolding added by GAO to denote changes from 1995.
[End of table]
Our analysis of lessons learned from prior BRAC rounds affirmed the
soundness of these basic criteria and generally endorsed their
retention for the future, while recognizing the potential for improving
the process by which the criteria are used in decision making.[Footnote
11] Notwithstanding our endorsement of the criteria framework, in a
January 27, 2004, letter to DOD, we identified two areas in which we
believed the draft selection criteria needed greater clarification to
fully address special considerations called for in the legislation (see
app. III). Specifically, we noted that the criterion related to cost
and savings does not indicate the department's intention to consider
potential costs to other DOD activities or federal agencies that may be
affected by a proposed closure or realignment recommendation. Also, we
pointed out the criterion on environmental impact does not clearly
identify to what extent costs related to potential environmental
restoration, waste management, and environmental compliance activities
would be included in cost and savings analyses of individual BRAC
recommendations. We suggested that DOD could address our concerns by
incorporating these considerations either directly, in its final
criteria, or through later explanatory guidance. DOD indicated it would
address our concerns through clarifying guidance rather than a change
to the criteria. We have not yet seen that guidance.
DOD also received a variety of other comments on the draft criteria
from members of Congress, other elected representatives, and the
general public but did not make any changes before issuing the final
criteria. Most of these comments involved the military value criteria
(see table 3: 1-4) and centered on the maintenance of adequate surge
capacity; the roles military installations fulfill in homeland defense
missions; the unique features of research, development, test, and
evaluation facilities; and the preservation of vital human capital in
various support functions. In responding to those comments, DOD
expressed the view that the draft criteria adequately addressed these
issues and did not see the need to make any changes to its draft
criteria. For example, DOD said that surge requirements will be
addressed under criterion one, which requires the department to
consider "current and future mission capabilities," and criterion
three, which requires DOD to consider an installation's ability to
"accommodate contingency, mobilization, and future total force
requirements" to support operations and training. Furthermore, DOD
noted that the National Defense Authorization Act for Fiscal Year 2004
requires the Secretary of Defense to "assess the probable threats to
national security" and determine "potential, prudent, surge
requirements" as part of BRAC 2005. DOD also noted that criterion two
recognizes the role of military installations as staging areas for
forces conducting homeland defense missions.
Collectively, in our view, many of the public comments on DOD's
criteria expressed concern that the criteria for the 2005 BRAC round
focused more on assessing military value based on military missions and
operational capabilities without recognizing important support
capabilities such as research, development, test, and evaluation.
Although modifications to the criteria might have been made to address
some of these concerns, the absence of such changes does not
necessarily mean that these issues will not be considered in applying
the criteria during the BRAC process. For example, the department has
established a variety of joint cross-service groups[Footnote 12] to
analyze various support functions during the upcoming round and each
group will have to adapt the final criteria for its particular support
area to assess military value related to each functional area. While
our monitoring of the ongoing BRAC process indicates this is occurring,
the effectiveness of these efforts will best be assessed as these
groups complete their work.
Observations on Other Key BRAC-Related Issues Included in
DOD's Report:
Other BRAC-related issues included in DOD's report--excess
infrastructure capacity, estimated savings for the 2005 round, and the
economic impact of prior BRAC actions on communities--are of widespread
interest to Congress and the public and important to DOD's
certification regarding the need for a BRAC round. Although the
methodology DOD employed to identify excess capacity has some
limitations, DOD's report does provides a rough indication that excess
base capacity exists. Further, historical financial data would suggest
that, assuming conditions similar to those in the 1993 and 1995 round,
each of the military departments could achieve annual net savings by
2011. As to economic impact, our work has shown that many communities
surrounding closed bases from the previous rounds have fared better
than the national average, in terms of changes in unemployment rates
and per capita income, with more mixed results recently, allowing for
some negative effect from the economic downturn in recent years.
DOD Analysis Indicates Excess Infrastructure Capacity Exists:
While DOD's analysis of its infrastructure capacity for the 2004
report, which was completed outside the 2005 BRAC process, gives some
indication of excess capacity across certain functional areas through
fiscal year 2009, the methodology for that analysis has some
limitations that could cause the results to be either overstated or
understated, and raises questions about use of the methodology to
project a total amount of excess capacity across DOD. At the same time,
DOD's methodology did not consider any additional excess capacity that
might occur by analyzing facilities or functions on a joint or cross-
service basis, a priority for the 2005 round. A more complete
assessment of capacity and the potential to reduce it must await the
results of the current BRAC analyses being conducted by DOD.
To estimate excess capacity, the military services and the Defense
Logistics Agency (DLA) compared the capacity for a sample of bases in
1989 with the projected capacity of a sample of bases in 2009. The
services and DLA categorized the bases according to their primary
function, and they identified a variety of indicators, or metrics, to
measure capacity for each functional category. For example, they used
total maneuver acres per brigade to establish capacity for Army
training bases, total square feet of parking apron space to establish
capacity for active and reserve Air Force bases, and total direct labor
hours (versus budget or programmed direct labor hours) to establish
capacity for Navy aviation depots. See app. IV for additional
information on how DOD computed excess capacity.
This methodology has some limitations as we reported[Footnote 13] in
1998 when DOD used it to project excess capacity in supporting the need
for a future BRAC round. DOD's use of 1989 as a baseline did not take
into account the excess base capacity that existed in that year prior
to base closures in the 1988, 1991, 1993, and 1995 BRAC rounds. As a
result, the percentage of increased excess capacity reported
understated actual excess capacity by an unknown amount for some
functional categories, and may have overstated excess capacity for
other categories. The Congressional Budget Office (CBO) also
reported[Footnote 14] that the department's use of 1989 as a baseline
did not take into account the excess capacity that might have existed
in 1989. Furthermore, CBO reported that the approach could understate
the capacity required if some types of base support are truly a fixed
cost, regardless of the size of the force. The methodology also did not
consider any additional excess capacity that might occur by analyzing
facilities or functions on a cross-service basis, a priority for the
2005 round. In addition, capacity for some functions was measured
differently for each service. For example, the Army and Air Force
measured capacity for test and evaluation facilities in terms of
physical total square feet of space, while the Navy measured its
capacity for these facilities in terms of work years. Finally, as we
recently noted, the variety of metrics and differences across the
military services makes it difficult to be precise when trying to
project a total amount of excess capacity across DOD.[Footnote 15]
Military service officials told us that they typically use most of the
capacity metrics included in DOD's report, along with other measures,
to assess excess capacity. For example, these officials stated that the
metrics for depots, industrial, shipyards, logistics bases, and supply
are used, along with other measures, as indicators of excess capacity.
However, we found that some of the metrics used in DOD's report were
less reliable than others as indicators of excess capacity. For
example, the metric for Marine Corps bases compared the acres at
five Marine Corps bases to the total authorized military personnel for
the Marine Corps, and not just the authorized personnel at the five
bases. Marine Corps officials acknowledged that this was not a
requirements-based metric to measure excess capacity at Marine Corps
bases. Likewise, the metric for administrative space in the Air Force
was based on the administrative space at only one Air Force base. Air
Force officials stated that this occurred because under the methodology
each Air Force base could only be considered in one functional area.
While prior BRAC rounds have focused primarily on reducing excess
capacity, DOD officials have stated this is not the sole focus of the
2005 BRAC round. These officials noted that the 2005 round aims to
further transform the military by rationalizing base infrastructure to
the force structure, enhance joint capabilities by improving joint
utilization, and convert waste to war-fighting capability by
eliminating excess capacity. This approach has the potential to
identify greater excess capacity than previously identified. However, a
true assessment of excess capacity must, of necessity, await the
completion of DOD's ongoing official analyses under BRAC 2005.
Extent of Savings from 2005 Round Are Unknown but Could Be Achieved
by 2011:
DOD's financial data would suggest that, assuming conditions similar to
those of the 1993 and 1995 rounds, the net annual savings for each of
the military departments for the 2005 round could be achieved by 2011,
as certified by the Secretary in DOD's report. DOD estimated that it
would accrue net annual savings of $3 billion to $5 billion
departmentwide by 2011. While we believe that the potential exists for
significant savings to result from the 2005 BRAC round, it is difficult
to conclusively project the expected magnitude of the savings because
there simply are too many unknowns, such as the specific timing of
individual closure or realignment actions and the extent to which DOD's
efforts to maximize joint utilization and further its transformation
efforts, would impact savings. Finally, to what extent forces that are
currently based overseas may be redeployed to the United States and
what effect that redeployment may have on BRAC and subsequent savings
remains an unknown as well.[Footnote 16]
The Secretary's estimate of $3 billion to $5 billion in net annual
savings by 2011 was based in part on savings achieved from the 1993 and
1995 BRAC rounds. The lower estimate assumes that the actions in the
2005 round would reduce infrastructure by about 12 percent, comparable
to the reduction that occurred in the 1993 and 1995 rounds combined.
The higher estimate assumes that infrastructure would be reduced by
20 percent, which is about 67 percent higher than the previous two
rounds combined. While we believe the potential for significant savings
exists, a more reliable estimate of savings is not practical until the
department has developed actual closure and realignment proposals.
While DOD's report estimated net annual savings of $3 billion to
$5 billion could be achieved departmentwide, it did not explicitly
indicate the amount of savings that each service would achieve by 2011.
Our analysis of the savings from the 1993 and 1995 BRAC rounds,
however, indicates that each department accrued net annual savings by
the sixth year of implementation, as seen in table 4.
Table 4: Net Annual Savings In the Sixth Year of Implementation for
BRAC 1993 and 1995 Rounds by Military Department:
Dollars in millions.
Army;
Net Annual Savings: 1993 BRAC round: $62;
Net Annual Savings: 1995 BRAC round: $22.
Navy;
Net Annual Savings: 1993 BRAC round: 1,099;
Net Annual Savings: 1995 BRAC round: 297.
Air Force;
Net Annual Savings: 1993 BRAC round: 168;
Net Annual Savings: 1995 BRAC round: 120.
Source: GAO Analysis of DOD's Fiscal Year 2005 Budget Estimates,
February 2004.
[End of table]
Another way of looking at net savings is to consider the point at which
cumulative savings exceed the cumulative costs of implementing BRAC
decisions over a period of years. Experience has shown that the
department incurs significant upfront investment costs in the early
years of a BRAC round, and it takes several years to fully offset those
cumulative costs and begin to realize cumulative net savings. The
difference in the terminology is important to understand because it has
a direct bearing on the magnitude and assessment of the savings at any
given time. As previously discussed, each military department achieved
net annual savings during the 1993 and 1995 rounds by the sixth year of
implementation. However, with the exception of the Navy in 1995, the
military departments did not achieve cumulative net savings for both
the 1993 and 1995 rounds until after the sixth year of implementation.
Notwithstanding the issues we raise that could affect savings, we
continue to believe that it is vitally important for DOD to improve its
mechanisms for tracking and updating its savings estimates. We have
previously noted that DOD's BRAC savings estimates have been imprecise
for a variety of reasons such as weaknesses in DOD's financial
management systems that limit the ability to fully account for the cost
of its operations; the fact the DOD's accounting systems like other
accounting systems are oriented to tracking expenses and disbursements,
not savings; the exclusion of BRAC-related costs incurred by other
government agencies; and inadequate updating of the savings estimates
that are developed. Improvements can and should be made to address this
issue. In its 1998 report to the Congress on BRAC issues, DOD proposed
efforts that, if adopted, could provide for greater accuracy in the
estimates. Specifically, DOD proposed developing a questionnaire that
would be completed annually by each base affected by BRAC rounds during
the 6-year implementation period. The questionnaire would request
information on costs, personnel reductions, and changes in operating
and military construction costs in order to provide greater insight
into the savings created by each BRAC action. DOD suggested that
developing such a questionnaire would be a cooperative effort involving
the Office of the Secretary of Defense, the military services, the
defense agencies, the Office of the DOD Inspector General, and the
service audit agencies. This proposal recognizes that better
documentation and updating of savings will require special efforts
parallel to the normal budget process. DOD has not yet initiated
actions to implement this proposal. We strongly endorse such action. If
DOD does not take steps to improve its estimation of savings in the
future, then previous questions about the reliability, accuracy, and
completeness of DOD's savings estimates will likely continue. We intend
to examine DOD's progress in instituting its proposed improvements
during our review of the 2005 BRAC process.
Many Affected Communities Are Recovering from BRAC Actions in Prior
Rounds:
The department's report recognized that BRAC actions can affect the
local economies of the surrounding communities. It noted that from 1988
through 1995, realignment or closure actions were approved at 387
locations; and that, in implementing the actions, the department had
sought to minimize any adverse local impacts with a coordinated program
of federal assistance from both DOD and domestic agencies.
Our own work has shown that while the short-term impact can be very
traumatic, several factors, such as the strength of the national and
regional economies, play a role in determining the long-term economic
impact of the base realignment or closure process on communities. Our
work has also shown that many communities surrounding closed bases from
the previous rounds have fared better than the national average, in
terms of changes in unemployment rates and per capita income, with more
mixed results recently, allowing for some negative effect from the
economic downturn in recent years.
Our analysis of selected economic indicators has shown that over time
the economies of BRAC-affected communities compare favorably with the
overall U.S. economy. We used unemployment rates and real per capita
income rates as broad indicators of the economic health of those
communities where base closures occurred during the prior BRAC rounds.
Our analysis included 62 communities surrounding base realignment and
closure sites from all four BRAC rounds for which government and
contractor civilian job losses were estimated to be 300 or more.
We previously reported that as of September 2001, of the 62 communities
surrounding these major base closures, 44 (71 percent) had average
unemployment rates lower than the (then) average 9-month national rate
of 4.58 percent.[Footnote 17] We are currently updating this analysis
and attempting to assess the impact of the recent economic downturn on
these communities. Our preliminary results indicate that, in keeping
with economic downturn in recent years, the average unemployment rate
in 2003 had increased for 60 of the 62 communities since 2001. However,
the 2003 unemployment figures indicated that the rates for these 62
communities continue to compare favorably with the overall U.S. rate of
6.1 percent; that is, 43 (or 69 percent) of the communities had
unemployment rates at or below the U.S. rate.
In our previous work, we had also reported that annual per capita
income growth rate of affected communities for these 62 BRAC-affected
communities compared favorably with national averages. We found that
from 1996 through 1999, 33 (or 53 percent) of the 62 communities had an
estimated annual real per capital income growth rate that was at or
above the average of 3.03 percent for the nation at that time. Our
recent analysis has also noted that changes in the average per capita
income growth rate of these communities over time compared favorably
with corresponding changes at the national level. This analysis
indicates that 30 (48 percent) of the 62 areas examined had average
income growth rates higher than the average U.S. rate of 2.2 percent, a
drop from the rate during the previous time period.
In our previous report,[Footnote 18] we identified a number of factors
that affected economic recovery, based on our discussions with various
community leaders. These factors included:
* robustness of the national economy,
* diversity of the local economy,
* regional economic trends,
* natural and labor resources,
* leadership and teamwork,
* public confidence,
* government assistance, and:
* reuse of base property.
If history is any indication, these factors are likely to be equally
applicable in dealing with the effects of closures and realignments
under BRAC 2005.
Certification of the Need for an Additional BRAC Round:
In transmitting the 2004 report to Congress, the Secretary of Defense
certified the need for an additional BRAC round. The certification was
predicated on the force-structure plan and infrastructure inventory
included with the report and was reinforced by the department's
assessment of excess capacity, economic impact, and a certification
that net annual savings from a 2005 round could be achieved by 2011.
The Secretary's certification of need for the 2005 BRAC round was
echoed by a separate March 22, 2004, memorandum to the Secretary from
the Chairman of the Joint Chiefs of Staff. It stated that the Joint
Chiefs unanimously agree that additional base realignments and closures
are necessary if DOD is to transform the armed forces to meet the
threats to national security and execute national strategy. The
Chairman also noted that "(d)uring this period of transition, we are
fundamentally reconfiguring our forces to meet new security challenges.
The military value requirements that flow from future force structure
and future strategy needs will differ in character and shape from those
of today. BRAC offers a critical tool to turn transformational goals
into reality." We found no basis to question DOD's certification of the
need for an additional BRAC round. The need for an additional BRAC
round has long been recognized by various defense officials and
studies--and noted in various GAO products since the time of the 1995
BRAC round. (See app. V for a summary of key points from selected GAO
products.):
The Secretary's certification of the need for a 2005 BRAC round is
underscored by the department's desire to realize broader objectives in
the 2005 round, including fostering jointness, transformation,
assessing common business oriented functions on a cross-service basis,
and accommodating the potential redeployment of some forces from
overseas bases back to the United States. Analyses conducted in these
areas could identify opportunities to achieve consolidations and reduce
capacity not previously identified. Having said that, we believe the
efficacy and sufficiency of DOD's BRAC analyses now under way--
considering the force structure plan, inventory, and selection
criteria--can best be assessed as the BRAC process unfolds.
Conclusion:
While we found no basis to question the Secretary's certification of
the need for an additional BRAC round, we identified some limitations
with the department's assessment of excess capacity, completed outside
the BRAC process, to meet the 2004 reporting requirement. While clear
limitations exist in DOD's assessment of excess capacity, it does
nonetheless point to some areas that warrant additional analysis--and
the current BRAC process is an appropriate forum for doing so.
Today's security environment is evolving, as are force structure
requirements along with technology advancements, and defense
transformation efforts. The department must consider ongoing force
transformation initiatives in its BRAC analyses as well as factor in
relevant assumptions about the potential for future force structure
changes--changes that likely will occur long after the timeframes for
the 2005 BRAC round. This includes consideration of future surge
requirements. Assuring Congress and the public that this analysis has
been done and that appropriate allowances for future force structure
changes have been incorporated into the process will be key to building
public confidence in the soundness of 2005 closure and realignment
recommendations. Full discussion of these issues by the department in
its report accompanying its BRAC recommendations in 2005 is warranted.
At the same time, consideration of these longer term issues should not
detract from opportunities available to DOD in the upcoming BRAC round
to achieve greater economies and efficiencies in support capabilities
and use of infrastructure through cross-servicing and joint utilization
of bases.
Finally, many questions have previously existed about the accuracy and
precision of DOD's estimates of savings from prior BRAC rounds.
Weaknesses in DOD's financial management systems have contributed to
this problem and are not likely to be resolved in the near term. At the
same time, we have previously recommended, and DOD has agreed that
improvements can and should be made to the accounting for and periodic
updating of BRAC savings. That notwithstanding, DOD has not made
sufficient efforts to address this issue. DOD needs to provide
assurance that it has plans in place for improvements in this area
before it begins implementing any closure and realignment decisions
from the upcoming BRAC round.
Recommendation for Executive Action:
We recommend that the Secretary of Defense include in his May 2005
report on recommendations for base closures and realignments a full
discussion of relevant assumptions, and allowances made for potential
future force structure requirements and changes, including the
potential for future surge requirements.
Matter for Congressional Consideration:
To ensure that the Department of Defense and the military services
improve their tracking and updating of BRAC savings estimates
associated with implementing closure and realignment decisions for the
upcoming BRAC round, Congress may want to consider requiring DOD and
the military services to provide certification that actions have been
taken to implement previously planned improvements for tracking and
updating its BRAC savings estimates. This certification should be
submitted with its fiscal year 2006 budget request documentation.
Agency Comments:
In commenting on a draft of this report, the Deputy Under Secretary of
Defense (Installations and Environment) agreed with our report. DOD's
comments are included in appendix VI of this report.
We are sending copies of this report to the Secretaries of Defense, the
Army, the Navy, and the Air Force; and the Director, Office of
Management and Budget. The report will also be available to others upon
request and can be accessed at no charge on GAO's Web site at http://
www.gao.gov. In addition, a list of our key prior reports on base
realignments and closures is included in appendix VII and these reports
can be accessed on our Web site as well.
Please contact me on (202) 512-8412 if you or your staff have any
questions regarding this report. Additional contacts and staff
acknowledgments are provided in appendix VIII.
Barry W. Holman, Director,
Defense Capabilities and Management:
List of Congressional Committees:
The Honorable John W. Warner:
Chairman:
The Honorable Carl Levin:
Ranking Minority Member:
Committee on Armed Services:
United States Senate:
The Honorable Ted Stevens:
Chairman:
The Honorable Daniel K. Inouye:
Ranking Minority Member:
Subcommittee on Defense:
Committee on Appropriations:
United States Senate:
The Honorable John Ensign:
Chairman:
The Honorable Daniel K. Akaka:
Ranking Minority Member:
Subcommittee on Readiness and Management Support:
Committee on Armed Services:
United States Senate:
The Honorable Kay Bailey Hutchison:
Chairman:
The Honorable Dianne Feinstein:
Ranking Minority Member:
Subcommittee on Military Construction:
Committee on Appropriations:
United States Senate:
The Honorable Duncan Hunter:
Chairman:
The Honorable Ike Skelton:
Ranking Minority Member:
Committee on Armed Services:
House of Representatives:
The Honorable Jerry Lewis:
Chairman:
The Honorable John P. Murtha:
Ranking Minority Member:
Subcommittee on Defense:
Committee on Appropriations:
House of Representatives:
The Honorable Joel Hefley:
Chairman:
The Honorable Solomon P. Ortiz:
Ranking Minority Member:
Subcommittee on Readiness:
Committee on Armed Services:
House of Representatives:
The Honorable Joe Knollenberg:
Chairman:
The Honorable Chet Edwards:
Ranking Minority Member:
Subcommittee on Military Construction:
Committee on Appropriations:
House of Representatives:
[End of section]
Appendix I: Scope and Methodology:
The scope of this report was determined by the legislative requirements
imposed on us and included in sections 2912 and 2913 of the Defense
Base Closure and Realignment Act of 1990, as amended. Our focus was to
assess the Department of Defense's (DOD) March 24, 2004, report to
Congress regarding issues associated with the need for an additional
BRAC round as well as the final selection criteria for the upcoming
2005 BRAC round as published in the Federal Register on February 12,
2004. Because of time constraints, we could not fully assess the
accuracy of all data used in the report but performed limited
reliability assessments of key data contained in DOD's report and
determined that the data were sufficiently reliable for the purposes of
this report, with relevant limitations noted.
DOD Responsiveness to Legislative Requirements:
We evaluated DOD's responsiveness to the legislative reporting
requirements by comparing individual requirements as presented in the
legislation with DOD's presentation of information in its report and
final selection criteria. Where appropriate, we made judgments as to
the extent to which DOD addressed the requirements, and discussed with
DOD officials those areas where we believed the requirements were not
fully addressed. In some cases, DOD officials from the BRAC Office
within the Office of the Secretary of Defense (OSD) told us that the
information provided was somewhat limited in order to avoid preempting
or prejudging the ongoing analytical process for the 2005 BRAC round.
Worldwide Installation Inventory, Force Structure Plan, and Selection
Criteria:
To address the importance of the worldwide installation inventory,
force structure plan, and selection criteria and evaluated, where
appropriate, the analytical sufficiency and accuracy of each, we
interviewed DOD officials to obtain their views on the relative
importance and applicability of each to the BRAC 2005 process and
analyzed the corresponding documentation for analytical sufficiency and
accuracy where it was reasonable to do so.
More specifically, to evaluate the worldwide installation inventory, we
interviewed officials from the contracting firm responsible to DOD for
managing its Facilities Assessment Database, the DOD-wide database that
was used to compile the worldwide inventory. Our interest was in
documenting the contractor's process for validating the real property
data in the database. Because the DOD-wide database draws from the
services' real property databases, we reviewed the contractor's
analysis of anomalies identified in the services' real property
databases (i.e., the Army's Integrated Facilities System, the Navy's
and Marine Corps' Navy Facility Assets database, and the Air Force's
Automated Civil Engineer System) to gain a sense of the relative
accuracy of the data. We also compared the list of Army, Navy, Marine
Corps, and Air Force installations receiving the recent data capacity
call for the 2005 BRAC round to the installation inventory to assure
ourselves that these installations were a subset of the worldwide
inventory. Furthermore, to determine if the inventory included all
overseas installations, we compared the listed installations by country
to a list of countries where U.S. forces are currently deployed. We
then interviewed a DOD official to verify and obtain rationale for the
absence of some overseas installations in the inventory.
To evaluate the unclassified portion (fiscal years 2005 through 2009)
of DOD's 20-year force structure plan as presented in DOD's 2004
report, we identified major force unit and personnel end strength
changes by service over the specified time frame and sought out
rationale for the increases or decreases. We discussed with service
officials the nature of these changes and how these revisions would be
considered in the BRAC process. We also interviewed service officials
regarding a number of initiatives under way, such as the Army's efforts
to increase the number of brigades in its force, that have implications
for the future sizing and composition of the force structure and
associated infrastructure for those respective services. We inquired as
to when planned force structure changes stemming from these initiatives
would be incorporated into DOD's force structure plan.
To evaluate the final selection criteria for the upcoming 2005 round,
we compared the criteria as published in the Federal Register on
February 12, 2004, with those used in the 1995 BRAC round. In so doing,
we noted the differences and evaluated whether the legislatively
directed language[Footnote 19] regarding selection criteria was
incorporated into the revised criteria for the upcoming round. In
addition to discussing with DOD officials the use of these criteria as
part of a framework for conducting its base analyses for the 2005
round, we relied on our prior work that reported on lessons learned
from previous base closure rounds, which covered, among other topics,
the analytical sufficiency of the selection criteria. We also referred
to a January 27, 2004, letter we sent to the Acting Under Secretary of
Defense (Acquisition, Technology & Logistics) commenting on our
analysis of the draft criteria that were out for public comment at that
time. Finally, we reviewed the public comments received on the draft
selection criteria and discussed with DOD officials their rationale for
not incorporating any of the suggested changes into the final selection
criteria.
Excess Defense Infrastructure Capacity, Estimated BRAC Savings, and
Economic Impact:
While the mandate did not specifically require us to address excess
defense infrastructure capacity, estimated BRAC savings from the 2005
round, and economic impact of communities surrounding base closures in
prior rounds, as discussed in DOD's 2004 report, we chose to do so
because of widespread interest in Congress and the public and its
importance to DOD's certification of the need for a BRAC round. In
addition to an analysis of these topics as presented in DOD's 2004
report, we relied on prior and ongoing work related to these areas of
interest.
More specifically, to evaluate the analytical sufficiency of DOD's
excess capacity analysis, we interviewed DOD and service officials and
reviewed documentation describing DOD's methodology. We inquired about
the reasonableness of the various metrics used to develop the capacity
measures for the various functional support areas, such as depots,
identified in the analysis in DOD's report. We verified the
calculations of increases in each of the functional areas and on an
aggregate basis, and partially verified the data reported by the
services in making the comparisons of capacity between the 1989
baseline year and 2009. DOD's BRAC Office provided the services with
the 1989 baseline numbers for the various metrics used to measure
capacity. We were unable to verify the 1989 baseline data in DOD's
report for the Army and Department of the Navy, which had accepted the
numbers, because supporting documentation from DOD's development of
that data had not been retained from the time that data were first
developed in 1998 for an earlier DOD report. However, we did verify the
Air Force's 1989 baseline numbers because it revised the DOD-provided
1989 baseline numbers using available data. We also selectively
verified the projected 2009 data in the analysis.
To evaluate whether DOD's estimates for expected savings from the
upcoming 2005 round were reasonable, we interviewed a DOD official in
the Office of the Secretary of Defense (OSD) BRAC Office and examined
the methodology, to include assumptions and the underlying basis
employed by DOD in deriving the estimates. Because a key assumption for
building the estimates focused on the probable range of reductions for
aggregate plant replacement value reductions (i.e., the scope of the
infrastructure reduction) that had occurred across a combination of the
1993 and 1995 rounds, we were not in a position to question whether
this assumption would be valid for the 2005 round, given that the
analysis for the 2005 round has not yet been completed. As to whether
DOD can achieve the net annual savings for each military department by
2011, we reviewed DOD's historical financial data for the 1993 and 1995
round to ascertain if the military departments achieved net annual
savings by the final or sixth year of implementation for these rounds.
This would correspond to the year 2011 for the 2005 round and again
would assume that the 2005 round would be similar to that of the 1993
and 1995 rounds.
To evaluate the economic recovery of communities affected by the BRAC
process in the prior rounds, we first performed a broad-based economic
assessment of 62 communities where more than 300 civilian jobs were
eliminated during the prior closure rounds.[Footnote 20] This work was
essentially an update of similar work we had performed and reported on
in April 2002.[Footnote 21] We used two key economic indicators--
unemployment and real per capital growth rates--as measures to analyze
changes in the economic condition of communities over time in relation
to the national averages. We chose unemployment and real per capital
income as key performance indicators because (1) DOD used these
measures in its community economic impact analysis during the BRAC
location selection process and (2) economists commonly use these
measures in assessing the economic health of an area over time. While
our assessment does provide an overall picture of how these communities
compare with the national averages, it does not necessarily isolate the
condition, or the changes to the condition, that may be attributed to
the BRAC action.
We conducted our work from March to May 2004 in accordance with
generally accepted government auditing standards.
[End of section]
Appendix II: BRAC 2005 Timeline:
[See PDF for image]
[End of figure]
[End of section]
Appendix III: GAO's Letter on Draft Selection Criteria for the 2005
Base Closure Round:
January 27, 2004:
The Honorable Michael W. Wynne:
Acting Under Secretary of Defense (Acquisition, Technology & Logistics)
Department of Defense:
Subject: Draft Selection Criteria for the 2005 Base Closure Round:
Dear Mr. Wynne:
The National Defense Authorization Act for Fiscal Year 2002 [NOTE 1]
extended the authority of the 1990 Defense Base Closure and Realignment
Act, authorizing another round of base realignment and closures in
2005. The 2002 legislation continued the requirement enacted in 1990
requiring the Secretary of Defense to publish in the Federal Register
the selection criteria proposed by the Department of Defense (DOD) for
use in base realignment and closure (BRAC) recommendations and to
provide the opportunity for public comment, while stipulating specific
areas of emphasis for 2005. The proposed selection criteria were
published on December 23, 2003, with a public comment period ending
January 28, 2004. The Act requires the Secretary of Defense to publish
the final selection criteria no later than February 16, 2004, and
allows for congressional disapproval of those criteria by an Act of
Congress until March 15, 2004. Given GAO's longstanding role in
monitoring the BRAC process, I am providing GAO's observations on the
draft criteria with our suggestions for clarification in two areas for
the department's consideration either in finalizing the criteria or in
subsequent implementing guidance to ensure consistent understanding and
application of the criteria.
Draft Criteria Continue Framework Used in Prior BRAC Rounds:
The department's draft criteria essentially follow a framework similar
to that employed in prior BRAC rounds, with added specificity in
selected areas in response to requirements contained in the 2002
legislation. The 2002 legislation required that DOD give priority to
military value and consider (1) the impact on joint warfighting,
training, and readiness; (2) the availability and condition of training
areas suitable for maneuver by ground, naval, or air forces throughout
diverse climates, terrains, and staging areas for use by the Armed
Forces in homeland defense missions; and (3) the ability to accommodate
contingency, mobilization, and future force requirements. The
legislation also required DOD to give special consideration to other
factors, many of which replicate criteria used in prior BRAC rounds.
Finally, the legislation required DOD to consider cost impacts to other
Federal entities as well as to DOD in its BRAC decision-making. (See
appendix I for a summary of the legislative provisions.) Figure 1
compares the 1995 BRAC criteria with that proposed for 2005, with
changes highlighted in bold.
Figure 1: BRAC Criteria from 1995 and Those Proposed for 2005:
[See PDF for image]
Source: DOD (emphasis bolding added by GAO).
[End of figure]
Our analysis of lessons learned from prior BRAC rounds affirmed the
soundness of these basic criteria and generally endorsed their
retention for the future, while recognizing the potential for improving
the process by which the criteria are used in decision-making. [NOTE 2]
Areas where Clarification Is Needed:
There are two areas where we believe the draft selection criteria may
need greater clarification to fully address the special considerations
called for in the 2002 legislation. DOD could accomplish this by either
incorporating these considerations directly in its final criteria or
through later explanatory guidance. Specifically, the criterion related
to cost and savings does not indicate the department's intention to
consider potential costs to other DOD activities or federal agencies
that may be affected by a proposed closure or realignment
recommendation. Also, it is not clear to what extent the impact of
costs related to potential environmental restoration, waste management,
and environmental compliance activities would be included in cost and
savings analyses of individual BRAC recommendations.
Potential Costs to Other Federal Agencies:
The proposed selection criterion does not indicate the department's
intention to consider potential costs to other DOD activities or
federal agencies that may be affected by a BRAC recommendation. The
2002 legislation authorizing the upcoming BRAC round stipulated that
"any selection criteria proposed by the Secretary relating to the cost
savings or return on investment from the proposed closure or
realignment of military installations shall take into account the
effect of the proposed closure or realignment on the costs of any other
activity of the Department of Defense or any other federal agency that
may be required to assume responsibility for activities at the military
installations." The emphasis on assessing cost impacts on other federal
agencies repeats the concern we expressed in prior BRAC rounds that
some DOD BRAC recommendations excluded costs that might be incurred by
other federal agencies as a result of BRAC actions. We then recommended
that DOD at least disclose such costs. [NOTE 3] We believe that DOD
needs to clarify, either in its final criteria or in explanatory
guidance, its plans for complying with this new legislative
requirement.
Clarifv Consideration of Environmental Costs:
The proposed selection criteria makes it unclear to what extent the
impact of costs related to potential environmental restoration, waste
management, and environmental compliance activities would be included
in cost and savings analyses of individual BRAC recommendations. The
2002 legislation requires DOD to give special consideration to the
impact of costs related to potential environmental restoration, waste
management, and environmental compliance activities. DOD incorporated
this language into the 2005 BRAC round's draft criterion #8. This is an
expansion of criterion #8 from the 1995 round which, as implemented
during that round, called for Defense components to consider the impact
of BRAC actions on such environmental issues as threatened or
endangered species, wetlands, floodplains, water supplies, and air
quality, but it did not address the issue of environmental costs. Left
unstated and, likely, unclear to the public and to the Congress, is the
extent to which the Department intends for environmental costs,
particularly those for restoration, to be considered under criterion #5
in evaluating potential costs and savings associated with individual
realignment and closure options. [NOTE 4]
We recognize that determining the extent to which environmental
restoration costs should be considered in BRAC decisionmaking (and
associated costing analyses) is an issue that has elicited differing
opinions among the interested parties in prior BRAC rounds. However,
DOD policy guidance has historically stipulated that environmental
restoration costs were not to be factored into analyses of costs and
savings when examining potential bases for realignment and closure,
since DOD was obligated to restore contaminated sites on military bases
regardless of whether or not they were closed.[NOTE 5] We recognize
that determining such costs could be problematic in advance of a
closure decision, since reuse plans for BRAC properties would not yet
be determined and studies to identify restoration requirements would
not yet be completed. On the other hand, budgeted costs for
environmental compliance activities would be more readily available at
the time when realignment and closing options were being considered. To
the extent compliance costs can be identified for facilities being
reviewed under the BRAC process, a more compelling case can be made for
including them in the cost and savings analyses completed under
criterion #5. Regardless, we believe that DOD needs to clarify, either
in the final criteria or in supplemental guidance, its plans for
considering environmental costs in its cost and savings analyses under
criterion #5.
With the clarifications specified above, the proposed selection
criteria would more clearly address the legislative requirements.
Further, the draft criteria, if adopted, would add an element of
consistency and continuity in approach with those of the past three
BRAC rounds. The full analytic sufficiency of the final criteria will
best be assessed through their application, as DOD completes its BRAC
data collection and analyses. The transparency, consistency, and logic
of individual closure and realignment recommendations in relation to
those criteria will be important considerations as we and others assess
DOD recommendations. Please contact me at (202) 512-8412 if you would
like to further discuss these issues.
Sincerely yours,
Signed by:
Barry W. Holman, Director:
Defense Capabilities and Management:
cc: Raymond F. DuBois:
Deputy Under Secretary of Defense (Installations and Environment):
Philip Grone:
Principal Assistant Deputy Under Secretary of Defense (Installations
and Environment):
Appendix I: Legislation Provisions Regarding Section Criteria for 2005
Round [NOTE 6]:
The selection criteria prepared by the Secretary shall ensure that
military value is the primary consideration in making of
recommendations for the closure or realignment of military
installations. Military value shall include at a minimum the following:
* Preservation of training area suitable for maneuver by ground, naval,
or air forces to guarantee future availability of such areas to ensure
the readiness of the Armed Forces.
* Preservation of military installations in the United States as staging
areas for the use of the Armed Forces in homeland defense missions.
* Preservation of military installations throughout a diversity of
climate and terrain areas in the United States for training purposes.
* The impact on joint warfighting, training, and readiness.
* Contingency, mobilization, and future force requirements at both
existing and potential receiving locations to support operations and
training.
The selection criteria for military installations shall also address at
a minimum the following:
* The extent and timing of potential costs and savings, including the
number of years, beginning with the date of completion of the closure
or realignment, for the savings to exceed costs.
* The economic impact on existing communities in the vicinity of
military installations.
* The ability of both existing communities and potential receiving
communities' infrastructure to support forces, missions, and personnel.
* The impact of costs related to potential environmental restoration,
waste management, and environmental compliance activities.
Any section criteria proposed by the Secretary relating to the cost
savings or return on investment from the proposed closure or
realignment of military installations shall take into account the
effect of the proposed closure or realignment on the costs of any other
activity of the Department of Defense or any other federal agency that
may be required to assume responsibility for activities at the military
installations.
(305486):
NOTES:
[1] P.L. 107-107, Title XXX (Dec. 28, 2001).
[2] U.S. General Accounting Office, Military Bases Lessons Learned from
Prior Base Closure Rounds, GAO/NSIAD-97-151 (Washington, D.C.: July 25,
1997).
[3] U.S. General Accounting Office, Military Bases: Analysis of DOD's
1995 Process and Recommendations for Closure and Realignment,
GAO/NSIAD-95-133 (Washington, D. C.: April 14, 1995).
[4] In completing cost and savings analyses of proposed base
realignment and closure actions, DOD uses the Cost of Base Realignment
Actions (COBRA) model that relies on base-specific data, scenario-
specific data, and standardized data to calculate cost and savings
estimates that can be compared with other potential realignment and
closure actions.
[5] Such costs were considered once BRAC decisions were final and
budgets were developed to implement the decisions.
[6] P.L. 107-107, Section 3002 (Dec. 28, 2001).
[End of section]
Appendix IV: DOD's Methodology for Estimating Excess Capacity:
To perform the capacity analysis, the services and the Defense
Logistics Agency (DLA) compared capacity in a sample of bases in 1989
to the capacity for a sample of bases in 2009. The services then
categorized the bases according to their primary missions and defined
indicators of capacity, or metrics, for each category. DOD divided the
metric by measures of force structure to determine a ratio and
calculated the extent to which the ratio of capacity in 2009 exceeded
the ratio in 1989. As an example, table 5 shows the results for the
Army as shown in DOD's report. Similar tables appear for the Navy, Air
Force, and DLA in DOD's report.
Table 5: Army Analysis of Proportional Capacity:
Base category/metric: Administration: Administrative space square feet
(000);
Input: Fiscal Year 1989: 6,627;
Input: Fiscal Year 2009: 6,121;
Index[A]: Fiscal Year 1989: [Empty];
Index[A]: Fiscal Year 2009: [Empty];
Proportional capacity[B]: [Empty];
Change in capacity relative to force structure since 1989:
Delta from 2009 capacity[C]: [Empty];
Change in capacity relative to force structure since 1989:
Excess 2009 capacity[D]: [Empty].
Base category/metric: Administration: Military/civilian authorized;
Input: Fiscal Year 1989: 81,518;
Input: Fiscal Year 2009: 64,598;
Index[A]: Fiscal Year 1989: 0.0813;
Index[A]: Fiscal Year 2009: 0.0948;
Proportional capacity[B]: 5,251;
Change in capacity relative to force structure since 1989:
Delta from 2009 capacity[C]: 870;
Change in capacity relative to force structure since 1989:
Excess 2009 capacity[D]: 14%.
Base category/metric: Depots: Capacity direct labor hours (000);
Input: Fiscal Year 1989: 29,000;
Input: Fiscal Year 2009: 16,957;
Index[A]: Fiscal Year 1989: [Empty];
Index[A]: Fiscal Year 2009: [Empty];
Proportional capacity[B]: [Empty];
Change in capacity relative to force structure since 1989:
Delta from 2009 capacity[C]: [Empty];
Change in capacity relative to force structure since 1989:
Excess 2009 capacity[D]: [Empty].
Base category/metric: Depots: Budgeted/programmed direct labor hours;
Input: Fiscal Year 1989: 21,000;
Input: Fiscal Year 2009: 12,828;
Index[A]: Fiscal Year 1989: 1.3810;
Index[A]: Fiscal Year 2009: 1.3219;
Proportional capacity[B]: 17,715;
Change in capacity relative to force structure since 1989:
Delta from 2009 capacity[C]: No increase;
Change in capacity relative to force structure since 1989:
Excess 2009 capacity[D]: No increase.
Base category/metric: Industrial: Total facilities square feet (000);
Input: Fiscal Year 1989: 34,707;
Input: Fiscal Year 2009: 24,324;
Index[A]: Fiscal Year 1989: [Empty];
Index[A]: Fiscal Year 2009: [Empty];
Proportional capacity[B]: [Empty];
Change in capacity relative to force structure since 1989:
Delta from 2009 capacity[C]: [Empty];
Change in capacity relative to force structure since 1989:
Excess 2009 capacity[D]: [Empty].
Base category/metric: Industrial: Military/civilian authorized;
Input: Fiscal Year 1989: 23,897;
Input: Fiscal Year 2009: 9,498;
Index[A]: Fiscal Year 1989: 1.4524;
Index[A]: Fiscal Year 2009: 2.5610;
Proportional capacity[B]: 13,795;
Change in capacity relative to force structure since 1989:
Delta from 2009 capacity[C]: 10,529;
Change in capacity relative to force structure since 1989:
Excess 2009 capacity[D]: 43%.
Base category/metric: Major training active: Base acres;
Input: Fiscal Year 1989: 1,509,334;
Input: Fiscal Year 2009: 1,242,842;
Index[A]: Fiscal Year 1989: [Empty];
Index[A]: Fiscal Year 2009: [Empty];
Proportional capacity[B]: [Empty];
Change in capacity relative to force structure since 1989:
Delta from 2009 capacity[C]: [Empty];
Change in capacity relative to force structure since 1989:
Excess 2009 capacity[D]: [Empty].
Base category/metric: Major training active: Maneuver brigades;
Input: Fiscal Year 1989: 48;
Input: Fiscal Year 2009: 43;
Index[A]: Fiscal Year 1989: 31,444;
Index[A]: Fiscal Year 2009: 28,903;
Proportional capacity[B]: 1,352,112;
Change in capacity relative to force structure since 1989:
Delta from 2009 capacity[C]: No increase;
Change in capacity relative to force structure since 1989:
Excess 2009 capacity[D]: No increase.
Base category/metric: Major training reserve: Base acres;
Input: Fiscal Year 1989: 258,413;
Input: Fiscal Year 2009: 330,393;
Index[A]: Fiscal Year 1989: [Empty];
Index[A]: Fiscal Year 2009: [Empty];
Proportional capacity[B]: [Empty];
Change in capacity relative to force structure since 1989:
Delta from 2009 capacity[C]: [Empty];
Change in capacity relative to force structure since 1989:
Excess 2009 capacity[D]: [Empty].
Base category/metric: Major training reserve: End strength;
Input: Fiscal Year 1989: 319000;
Input: Fiscal Year 2009: 205,000;
Index[A]: Fiscal Year 1989: 0.8101;
Index[A]: Fiscal Year 2009: 1.6117;
Proportional capacity[B]: 166,065;
Change in capacity relative to force structure since 1989:
Delta from 2009 capacity[C]: 164,328;
Change in capacity relative to force structure since 1989:
Excess 2009 capacity[D]: 50%.
Base category/metric: Maneuver: Base acres;
Input: Fiscal Year 1989: 3,053,623;
Input: Fiscal Year 2009: 3,361,679;
Index[A]: Fiscal Year 1989: [Empty];
Index[A]: Fiscal Year 2009: [Empty];
Proportional capacity[B]: [Empty];
Change in capacity relative to force structure since 1989:
Delta from 2009 capacity[C]: [Empty];
Change in capacity relative to force structure since 1989:
Excess 2009 capacity[D]: [Empty].
Base category/metric: Maneuver: Maneuver brigades;
Input: Fiscal Year 1989: 48;
Input: Fiscal Year 2009: 43;
Index[A]: Fiscal Year 1989: 63,617;
Index[A]: Fiscal Year 2009: 78,179;
Proportional capacity[B]: 2,735,537;
Change in capacity relative to force structure since 1989:
Delta from 2009 capacity[C]: 626,142;
Change in capacity relative to force structure since 1989:
Excess 2009 capacity[D]: 19%.
Base category/metric: Schools: Instructional space square feet (000);
Input: Fiscal Year 1989: 14,964;
Input: Fiscal Year 2009: 14,854;
Index[A]: Fiscal Year 1989: [Empty];
Index[A]: Fiscal Year 2009: [Empty];
Proportional capacity[B]: [Empty];
Change in capacity relative to force structure since 1989:
Delta from 2009 capacity[C]: [Empty];
Change in capacity relative to force structure since 1989:
Excess 2009 capacity[D]: [Empty].
Base category/metric: Schools: Military/Civilian authorized;
Input: Fiscal Year 1989: 350,108;
Input: Fiscal Year 2009: 222,723;
Index[A]: Fiscal Year 1989: 0.0427;
Index[A]: Fiscal Year 2009: 0.0667;
Proportional capacity[B]: 9,519;
Change in capacity relative to force structure since 1989:
Delta from 2009 capacity[C]: 5,335;
Change in capacity relative to force structure since 1989:
Excess 2009 capacity[D]: 36%.
Base category/metric: Test and evaluation: Total facilities square feet
(000);
Input: Fiscal Year 1989: 48,924;
Input: Fiscal Year 2009: 51,321;
Index[A]: Fiscal Year 1989: [Empty];
Index[A]: Fiscal Year 2009: [Empty];
Proportional capacity[B]: [Empty];
Change in capacity relative to force structure since 1989:
Delta from 2009 capacity[C]: [Empty];
Change in capacity relative to force structure since 1989:
Excess 2009 capacity[D]: [Empty].
Base category/metric: Test and evaluation: Acquisition workforce;
Input: Fiscal Year 1989: 157,964;
Input: Fiscal Year 2009: 62,193;
Index[A]: Fiscal Year 1989: 0.3097;
Index[A]: Fiscal Year 2009: 0.8252;
Proportional capacity[B]: 19,262;
Change in capacity relative to force structure since 1989:
Delta from 2009 capacity[C]: 32,059;
Change in capacity relative to force structure since 1989:
Excess 2009 capacity[D]: 62%.
Source: DOD.
[A] The index for each functional area is computed by dividing the
denominator into the numerator. For example, the 1989 administration
index .0813 is derived by dividing 81,518 into 6,627.
[B] The proportional capacity is computed by multiplying the
denominator of the fiscal year 2009 input times the fiscal year 1989
index. For example, the administration proportional capacity 5,251 is
computed by multiplying 64,598 times .0813.
[C] The delta from 2009 capacity is computed by subtracting the
proportional capacity from the fiscal year 2009 index numerator. For
example, the administration delta from 2009 capacity 870 is computed by
subtracting 5,251 from 6,121.
[D] The percent of 2009 capacity is computed by dividing the delta from
2009 capacity by the fiscal year 1989 input numerator. For example, the
administration percent of 2009 capacity (14 percent) is computed by
dividing 6,627 into 870.
[End of table]
DOD then took a weighted average of all functional areas to determine
the overall excess capacity for each department. The weights were
computed by the number of bases in a functional area divided by the
total number of bases in all functional areas. Table 6 shows the
overall estimated percentage of excess capacity for each military
department and the DLA.
Table 6: Estimated Percentage of Excess Capacity:
Department: Army;
Estimated percentage of excess capacity: 29.
Department: Navy;
Estimated percentage of excess capacity: 21.
Department: Air Force;
Estimated percentage of excess capacity: 24.
Department: Defense Logistics Agency;
Estimated percentage of excess capacity: 17.
Total;
Estimated percentage of excess capacity: 24.
Source: DOD.
[End of table]
Likewise, DOD computed a weighted average to estimate an overall
percentage of excess capacity for DOD. The weights were computed from
the number of bases per department divided by the total of all bases
included in the analysis.
[End of section]
Appendix V: Key Points from Prior GAO Products Regarding the Need for
an Additional BRAC Round:
At the time the 1995 BRAC round was being completed and subsequently,
DOD officials, including the Secretary and the Chairman, Joint Chiefs
of Staff, recognized that additional excess capacity would remain
following that round and that future base realignments and closures
would be needed. Various GAO products have noted that issue in
subsequent years. The following are selected excerpts from key GAO
products.
* "Despite these recent BRAC rounds, DOD continues to maintain large
amounts of excess infrastructure, especially in its support functions,
such as maintenance depots, research and development laboratories, and
test and evaluation centers. Each service maintains its own facilities
and capabilities for performing many common support functions and, as a
result DOD has overlapping, redundant, and underutilized
infrastructure. DOD has taken some steps to demolish unneeded buildings
on various operational and support bases; consolidate certain
functions; privatize, outsource, and reengineer certain workloads; and
encourage interservicing agreements--however, these are not expected to
offset the need for additional actions. At the same time, DOD officials
recognize that significant additional reductions in excess
infrastructure requirements in common support areas could come from
consolidating workloads and restructuring functions on a cross-service
basis, something that has not been accomplished to any great extent in
prior BRAC rounds." U.S. General Accounting Office, Military Bases:
Lessons Learned From Prior Base Closure Rounds, GAO/NSIAD-97-151
(Washington, D.C.: July 25, 1997, p. 3).
* "Notwithstanding the results of the four recent BRAC rounds, DOD
officials recognized, even while they were finishing the 1995 round,
that they had missed OSD's goal in terms of reductions needed through
base closures. DOD calculated that the first three BRAC rounds reduced
the plant replacement value (PRV)[Footnote 22] of DOD's domestic
facilities by 15 percent. It established a goal for the fourth round of
reducing PRV by an additional 15 percent, for a total of 30 percent.
When the Secretary announced his recommendations for base closures and
realignments in 1995, OSD projected that if all of the Secretary's
recommendations were adopted, the total PRV would be reduced by
21 percent, nearly a third less than OSD's goal."[Footnote 23] GAO/
NSIAD-97-151, p. 17.
* "The Secretary of Defense's 1997 Quadrennial Defense Review, which
assessed defense strategy, programs, and policies, included the issue
of future base closures in the infrastructure portion of the review. In
his May 19, 1997, report to Congress on the results of this review, the
Secretary asked Congress to authorize domestic base closure rounds in
1999 and 2001. That recommendation was endorsed by the National Defense
Panel, the independent, congressionally mandated board that is
reviewing the work of the Quadrennial Defense Review and completing
its own review of defense issues." GAO/NSIAD-97-151, p. 3.
* DOD's Support Infrastructure Management has been designated as High-
Risk by GAO since 1997. GAO's January 2003 update noted that "DOD plans
an additional base closure round in 2005; this could enable it to
devote its facility resources on fewer, more enduring facilities. With
or without base closures, DOD faces the challenge of adequately
maintaining and revitalizing the facilities it expects to retain for
future use. Available information indicates that DOD's facilities
continue to deteriorate because of insufficient funding for their
sustainment, restoration, and modernization." U.S. General Accounting
Office, High-Risk Series: An Update, GAO-03-119 (Washington, D.C.:
Jan. 2003).
* In commenting on DOD's investment plans for reversing the aging of
its facilities, we noted that "—because of competing priorities, DOD is
not likely to realize its investment objectives for facilities in the
near term. More specifically, the services do not propose to fully fund
all of OSD's objectives for improving facilities or, in some instances,
the services have developed funding plans that have unrealistically
high rates of increase in the out-years compared with previous funding
trends and other defense priorities. The base realignment and closure
round authorized for fiscal year 2005, while it carries with it a
significant up-front investment cost to implement realignment and
closure decisions, offers an important opportunity to reduce excess
facilities and achieve greater efficiencies in sustaining and
recapitalizing the remaining facilities if sufficient funding levels
are maintained into the future. Additionally, DOD is reexamining its
worldwide basing requirements, which could potentially lead to
significant changes in facility requirements over the next several
years. As these decisions are implemented over the next several years,
this should permit DOD and the services to increasingly concentrate
future resources on enduring facilities." U.S. General Accounting
Office, Defense Infrastructure: Long-term Challenges in Managing the
Military Construction Program, GAO-04-288 (Washington, D.C.: Feb. 24,
2004).
[End of section]
Appendix VI: Comments from the Department of Defense:
OFFICE OF THE UNDER SECRETARY OF DEFENSE:
3000 DEFENSE PENTAGON WASHINGTON, DC 20301-3000:
ACQUISITION, TECHNOLOGY AND LOGISTICS:
MAY 14 2004:
Mr. Barry Holman, Director:
Defense Capabilities and Management
United States General Accounting Office
Washington, DC 20548:
Dear Mr. Holman:
This is the Department of Defense (DoD) response to the General
Accounting Office (GAO) draft report 04-760, "MILITARY BASE CLOSURES:
Assessment of DoD's 2004 Report on the Need for a Base Realignment and
Closure Round," dated May 2004, (GAO Code 350485).
The Department agrees with the draft report's findings. In particular,
the Department agrees with the report's finding that there was no basis
to question the Secretary's certification of the need for an additional
base realignment and closure (BRAC) round.
The Department also agrees with the report's assessment that while the
analysis of excess infrastructure capacity contained in the report has
limitations, the current BRAC 2005 process is an appropriate forum for
conducting a thorough analysis to address the
full extent of excess capacity. Regarding the comments on the necessity
to periodically update savings estimates, the Department acknowledges
that efforts to improve this capability must be undertaken. The
Department intends to have in place for BRAC 2005 a defense-wide
systematic approach.
BRAC 2005 is absolutely essential to rationalizing our infrastructure
with our force structure and to convert waste to warfighting
capabilities within a framework where military value is the primary
factor. The Department appreciates the opportunity to comment on the
draft report.
Sincerely,
Signed by:
Raymond F. DuBois,
Deputy Under Secretary of Defense (Installations and Environment):
[End of section]
Appendix VII: Key Prior GAO Reports on DOD's Base Realignments
and Closures:
Military Base Closures: Observations on Preparations for the Upcoming
Base Realignment and Closure Round. GAO-04-558T. Washington, D.C.:
March 25, 2004.
Military Base Closures: Better Planning Needed for Future Reserve
Enclaves. GAO-03-723. Washington, D.C.: June 27, 2003.
Military Base Closures: Progress in Completing Actions from Prior Base
Realignments and Closures. GAO-02-433. Washington, D.C.: April 5, 2002.
Military Base Closures: DOD's Updated Net Savings Estimate Remains
Substantial. GAO-01-971. Washington, D.C.: July 31, 2001.
Military Bases: Status of Prior Base Realignment and Closure Rounds.
GAO/NSIAD-99-36. Washington, D.C.: December 11, 1998.
Military Bases: Review of DOD's 1998 Report on Base Realignment and
Closure. GAO/NSIAD-99-17. Washington, D.C.: November 13, 1998.
Military Bases: Lessons Learned from Prior Base Closure Rounds. GAO/
NSIAD-97-151. Washington, D.C.: July 25, 1997.
Military Bases: Closure and Realignments Savings Are Significant, but
Not Easily Quantified. GAO/NSIAD-96-67. Washington, D.C.: April 8,
1996.
Military Bases: Analysis of DOD's 1995 Process and Recommendations for
Closure and Realignment. GAO/NSIAD-95-133. Washington, D.C.: April 14,
1995.
Military Bases: Analysis of DOD's Recommendations and Selection Process
for Closures and Realignments. GAO/NSIAD-93-173. Washington, D.C.:
April 15, 1993.
Military Bases: Observations on the Analyses Supporting Proposed
Closures and Realignments. GAO/NSIAD-91-224. Washington, D.C.: May 15,
1991.
Military Bases: An Analysis of the Commission's Realignment and Closure
Recommendations. GAO/NSIAD-90-42. Washington, D.C.: November 29, 1989.
[End of section]
Appendix VIII: GAO Contacts and Staff Acknowledgments:
GAO Contacts:
Michael Kennedy (202) 512-8333 James Reifsnyder (202) 512-4166:
Acknowledgments:
In addition to the individuals named above, Nelsie Alcoser, Nancy
Benco, Ray Bickert, Joel Christenson, Warren Lowman, Tom Mahalek, David
Mayfield, Charles Perdue, James Reynolds, and Laura Talbott made key
contributions to this report.
FOOTNOTES
[1] The National Defense Authorization Act of Fiscal Year 2002 (P.L.
107-107, Title XXX, Dec. 28, 2001) authorized a defense base
realignment and closure round for 2005 by amending the Defense Base
Closure and Realignment Act of 1990 (P.L. 101-510, Title XXIX, Nov. 5,
1990). Provisions in Section 2912 and 2913 of the 1990 Act, as amended,
require DOD to address various BRAC-related issues in order for the
2005 round to continue.
[2] Department of Defense, Report Required by Section 2912 of the
Defense Base Closure and Realignment Act of 1990, as amended through
the National Defense Authorization Act for Fiscal Year 2003,
(Washington, D.C., March 2004).
[3] The BRAC legislation for the 2005 round applies to military
installations in the 50 states, the District of Columbia, the
Commonwealth of Puerto Rico, Guam, the U.S. Virgin Islands, American
Samoa, and any other commonwealth, territory, or possession of the
United States.
[4] P.L. 107-107, Title XXX, (Dec. 28, 2001).
[5] See app. II for other key BRAC dates.
[6] At the same time, DOD has indicated that the domestic BRAC process
may be used to accommodate any decisions to relocate forces from
overseas bases that may result from an ongoing but separate study of
overseas basing.
[7] These databases include the Army's Integrated Facilities System;
the Navy's and Marine Corp's Navy Facility Assets Database; and the Air
Force's Automated Civil Engineer System.
[8] See U.S. General Accounting Office, Air Force Aircraft:
Consolidating Fighter Squadrons Could Reduce Costs, GAO/NSIAD-96-82
(Washington, D.C.: May 6, 1996).
[9] U.S. General Accounting Office, Force Structure: Improved Strategic
Planning Can Enhance DOD's Unmanned Aerial Vehicles Efforts, GAO-04-342
(Washington, D.C.: Mar. 17, 2004).
[10] P.L. 108-136, section 2822, (Nov. 24, 2003).
[11] See U.S. General Accounting Office, Military Bases: Lessons
Learned From Prior Base Closure Rounds, GAO/NSIAD-97-151 (Washington,
D.C.: July 25, 1997).
[12] DOD has established seven joint cross-service groups to examine
the following defense functional support areas--industrial, technical,
medical, headquarters and support activities, supply and storage,
education and training, and intelligence--during the 2005 BRAC process.
[13] See U.S. General Accounting Office, Military Bases: Review of
DOD's 1988 Report on Base Realignment and Closure, GAO/NSIAD-99-17
(Washington, D.C.: Nov. 13, 1998).
[14] See Congressional Budget Office: Review of the Report of the
Department of Defense on Base Realignment and Closure (Washington,
D.C.: July 1, 1998).
[15] U.S. General Accounting Office, Military Base Closures:
Observations on Preparations for the Upcoming Base Realignment and
Closure Round, GAO-04-558T (Washington, D.C.: Mar. 25, 2004).
[16] As previously noted, the Secretary of Defense has already
undertaken a comprehensive study of global basing and presence--the
Integrated Global Presence and Basing Strategy (IGPBS). DOD has
indicated that it expects that BRAC will accommodate any decisions from
that study that relocate forces to the U.S. and that DOD will
incorporate its global basing strategy into a comprehensive BRAC
analysis, thereby ensuring that any overseas redeployment decisions
inform its recommendations to the BRAC Commission. See Analysis of
Public Comments in 69 F.R. 6948, Feb. 12, 2004: DOD Final Selection
Criteria for Closing and Realigning Military Installations Inside the
United States.
[17] See U.S. General Accounting Office, Military Base Closures:
Progress in Completing Actions from Prior Realignments and Closures,
GAO-02-433 (Washington, D.C.: Apr. 5, 2002).
[18] GAO-02-433.
[19] The language appeared in Section 3002 of the National Defense
Authorization Act of 2002, P.L. 107-107 (Dec. 28, 2001).
[20] The impact areas for communities were defined by using standard
definitions for metropolitan and nonmetropolitan statistical areas and
reflected the impact areas used in the 1995 round.
[21] See GAO-02-433.
[22] PRV is defined as the cost to replace current facilities using
today's construction costs and standards. PRV is recognized as an
imprecise measure, one that is calculated differently by each service.
However, it was a key measure used by OSD to establish its goals for
base closures.
[23] The 1995 BRAC Commission did not approve all of the Secretary's
recommendations and it added other bases to the closure list. Since
that time, OSD has not recalculated the net reduction in PRV.
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