Navy Laboratories

As part of the 1993 round of base closures, the Navy recommended closing the Naval Undersea Warfare Center in Norfolk, Virginia and moving it to Newport, Rhode Island, to reduce excess capacity. Construction of the Center's new facility in Suffolk, Virginia, had begun nearly a year earlier and was nearing completion under a 20-year lease for a building built to the Center's specifications. The justification for the building was originally submitted in 1987, before base closure considerations and reduced Navy budgets. It was based on the detachment's existing leased spaces in the Norfolk area. GAO concludes that the Navy should not have entered into a long-term lease during a period of downsizing. If the Navy fails to find other occupants for the building, it could be forced to spend more than $24 million in lease costs over the course of the lease. In addition, the Navy spent more than $9 million on one-time relocation costs. Before signing the lease, the Navy had indications that the proposed facility might not be needed. As a result, GAO believes that options other than a long-term lease merited greater consideration. In GAO's view, the decision to build the Suffolk facility was questionable. GAO found no indication that other options were considered for acquiring space for a smaller detachment.