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Recommendations for Base Closures and Realignments' which was released 
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Report to Congressional Committees: 

July 2005: 

Military Bases: 

Analysis of DOD's 2005 Selection Process and Recommendations for Base 
Closures and Realignments: 

[Hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO-05-785]: 

GAO Highlights: 

Highlights of GAO-05-785, a report to congressional committees: 

Why GAO Did This Study: 

On May 13, 2005, the Secretary of Defense submitted proposed base 
realignment and closure (BRAC) actions to an independent commission for 
its review. The Commission must submit its recommendations to the 
President by September 8, 2005, for his acceptance or rejection in 
their entirety. Congress has final action to accept or reject these 
recommendations in their entirety later this year. The law requires 
that GAO issue a report on the Department of Defense’s (DOD) 
recommendations and selection process by July 1, 2005. GAO’s objectives 
were to (1) determine the extent to which DOD’s proposals achieved its 
stated BRAC goals, (2) analyze whether the process for developing 
recommendations was logical and reasoned, and (3) identify issues with 
the recommendations that may warrant further attention. Time 
constraints limited GAO’s ability to examine implementation details of 
most of the individual recommended actions. 

What GAO Found: 

DOD had varying success in achieving its 2005 BRAC goals of (1) 
reducing excess infrastructure and producing savings, (2) furthering 
transformation, and (3) fostering jointness. While DOD proposed a 
record number of closures and realignments, exceeding all prior BRAC 
rounds combined, many proposals focused on reserve bases and relatively 
few on closing active bases. Projected savings are almost equally 
large, but most savings are derived from 10 percent of the 
recommendations. While GAO believes savings would be achieved, overall 
up-front investment costs of an estimated $24 billion are required, and 
there are clear limitations associated with DOD’s projection of nearly 
$50 billion in savings over a 20-year period. Much of the projected net 
annual recurring savings (47 percent) is associated with eliminating 
jobs currently held by military personnel. However, rather than 
reducing end-strength levels, DOD indicates the positions are expected 
to be reassigned to other areas, which may enhance capabilities but 
also limit dollar savings available for other uses. Sizable savings 
were projected from efficiency measures and other actions, but 
underlying assumptions have not been validated and could be difficult 
to track over time. Some proposals represent efforts to foster 
jointness and transformation, such as initial joint training for the 
Joint Strike Fighter, but progress in each area varied, with many 
decisions reflecting consolidations within, and not across, the 
military services. In addition, transformation was often cited as 
support for proposals, but it was not well defined, and there was a 
lack of agreement on various transformation options. 

DOD’s process for conducting its analysis was generally logical, 
reasoned, and well documented. DOD’s process placed strong emphasis on 
data, tempered by military judgment, as appropriate. The military 
services and seven joint cross-service groups, which focused on common 
business-oriented functions, adapted their analytical approaches to the 
unique aspects of their respective areas. Yet, they were consistent in 
adhering to the use of military value criteria, including new 
considerations introduced for this round, such as surge and homeland 
defense needs. Data accuracy was enhanced by the required use of 
certified data and by efforts of the DOD Inspector General and service 
audit agencies in checking the data. 

Time limitations and complexities introduced by DOD in weaving together 
an unprecedented 837 closure and realignment actions across the country 
into 222 individual recommendations caused GAO to focus more on 
evaluating major cross-cutting issues than on implementation issues of 
individual recommendations. GAO identified various issues that may 
warrant further attention by the Commission. Some apply to a broad 
range of recommendations, such as assumptions and inconsistencies in 
developing certain cost and savings estimates, lengthy payback periods, 
or potential impacts on affected communities. GAO also identified 
certain candidate recommendations, including some that were changed by 
senior DOD leadership late in the process that may warrant attention. 

What GAO Recommends: 

GAO is making a recommendation to DOD aimed at tracking and 
periodically updating savings, and is highlighting issues for the BRAC 
Commission’s consideration. 

In providing oral comments on a draft of this report, DOD concurred 
with the recommendation to establish a system to track and periodically 
update BRAC savings estimates. 

www.gao.gov/cgi-bin/getrpt?GAO-05-785. 

To view the full product, including the scope and methodology, click on 
the link above. For more information, contact Barry W. Holman at (202) 
512-5581 or holmanb@gao.gov. 

[End of section]

Contents: 

Letter: 

Results in Brief: 

Background: 

DOD's Recommendations Would Have Varying Degrees of Success in 
Achieving Goals for the 2005 BRAC Round: 

DOD Developed a Generally Logical and Reasoned Process for Making BRAC 
Decisions: 

Several Aspects of DOD's BRAC Recommendations and Rejected Proposals 
May Warrant Further Attention: 

Conclusions: 

Recommendation for Executive Action: 

Agency Comments: 

Appendixes: 

Appendix I: Scope and Methodology: 

Appendix II: Glossary of BRAC-Related Terms: 

Appendix III: The Department of the Army Selection Process and 
Recommendations: 

Appendix IV: The Department of the Navy Selection Process and 
Recommendations: 

Appendix V: The Department of the Air Force Selection Process and 
Recommendations: 

Appendix VI: Education and Training Joint Cross-Service Group Selection 
Process and Recommendations: 

Appendix VII: Headquarters and Support Activities Joint Cross-Service 
Group Selection Process and Recommendations: 

Appendix VIII: Industrial Joint Cross-Service Group Selection Process 
and Recommendations: 

Appendix IX: Intelligence Joint Cross-Service Group Selection Process 
and Recommendations: 

Appendix X: Medical Joint Cross-Service Group Selection Process and 
Recommendations: 

Appendix XI: Supply and Storage Joint Cross-Service Group Selection 
Process and Recommendations: 

Appendix XII: Technical Joint Cross-Service Group Selection Process and 
Recommendations: 

Appendix XIII: Cost of Base Realignment Actions Model: 

Appendix XIV: Economic Impact Assessments: 

Appendix XV: Draft DOD Transformational Options Recommended for 
Approval: 

Appendix XVI: Key GAO and Other Defense Audit Agency Products Related 
to DOD's 2005 Base Realignments and Closures: 

Appendix XVII: GAO Contact and Staff Acknowledgments: 

Tables: 

Table 1: Comparison of BRAC 2005 with Previous Rounds: 

Table 2: Projected Costs and Savings from BRAC 2005 Recommendations: 

Table 3: Major Recommendations Supporting Joint Activity: 

Table 4: Payback Periods for BRAC Recommendations by DOD Component: 

Table 5: Estimated Environmental Restoration Costs for DOD's 
Recommended Major Base Closures: 

Table 6: Military Installations That Would Receive a Net Gain of Over 
2,000 Personnel due to BRAC Actions: 

Table 7: Candidate Recommendations That Were Deleted or Significantly 
Revised by the Infrastructure Executive Council: 

Table 8: Excess Capacity Identified by the Army for Selected Mission 
Areas: 

Table 9: Army Military Value Criteria Weights: 

Table 10: Financial Aspects of the Army's Recommendations: 

Table 11: Excess Capacity Identified by the Navy, by Function: 

Table 12: Navy Military Value Criteria Weights: 

Table 13: Financial Aspects of the Navy's Recommendations: 

Table 14: Comparison of Alternatives to Closing and Realigning Naval 
Air Station Brunswick and Marine Corps Logistics Base Barstow: 

Table 15: Excess Capacity Identified by the Air Force, by Function: 

Table 16: Air Force Military Value Criteria Weights: 

Table 17: Financial Aspects of the Air Force's Recommendations: 

Table 18: Impact of Air Force BRAC Recommendations on Installations 
with Flying Missions, by Component: 

Table 19: Comparison of Alternatives to Closing or Realigning Grand 
Forks Air Force Base: 

Table 20: Excess Capacity Identified by the Education and Training 
Joint Cross-Service Group: 

Table 21: Education and Training Joint Cross-Service Group Military 
Value Criteria Weights: 

Table 22: Financial Aspects of the Education and Training Joint Cross-
Service Group's Recommendations: 

Table 23: Excess Capacity Identified by the Headquarters and Support 
Activities Joint Cross-Service Group: 

Table 24: Headquarters and Support Activities Joint Cross-Service Group 
Military Value Criteria Weights: 

Table 25: Financial Aspects of the Headquarters and Support Activities 
Joint Cross-Service Group's Recommendations: 

Table 26: Impact of One-time Antiterrorism and Force Protection Savings 
on Recommendations Involving Leased Space: 

Table 27: Excess Capacity Identified by the Industrial Joint Cross-
Service Group: 

Table 28: Industrial Joint Cross-Service Group Military Value Criteria 
Weights: 

Table 29: Financial Aspects of the Industrial Joint Cross-Service 
Group's Recommendations: 

Table 30: Excess Capacity Identified by the Intelligence Joint Cross-
Service Group: 

Table 31: Intelligence Joint Cross-Service Group Military Value 
Criteria Weights: 

Table 32: Financial Aspects of the Intelligence Joint Cross-Service 
Group's Recommendations: 

Table 33: Excess Capacity Identified by the Medical Joint Cross-Service 
Group: 

Table 34: Medical Joint Cross-Service Group Military Value Criteria 
Weights: 

Table 35: Financial Aspects of the Medical Joint Cross-Service Group's 
Recommendations: 

Table 36: Excess Capacity Identified by the Supply and Storage Joint 
Cross-Service Group: 

Table 37: Supply and Storage Joint Cross-Service Group Military Value 
Criteria Weights: 

Table 38: Financial Aspects of the Supply and Storage Joint Cross-
Service Group's Recommendations: 

Table 39: Excess Capacity Identified by the Technical Joint Cross-
Service Group: 

Table 40: Technical Joint Cross-Service Group Military Value Criteria 
Weights: 

Table 41: Financial Aspects of the Technical Joint Cross-Service 
Group's Recommendations: 

Table 42: Comparison of Alternatives to Personnel Reductions for the 
Recommendation to Create a Naval Integrated Weapons and Armaments 
Research, Development and Acquisition, and Test and Evaluation Center: 

Table 43: Estimated Costs and Savings for the Rejected Closure of Los 
Angeles Air Force Base: 

Table 44: Major Improvements to COBRA for the BRAC 2005 Round: 

Table 45: Five Economic Areas with the Greatest Negative Impact on 
Employment: 

Table 46: Five Economic Areas with the Greatest Positive Economic 
Impact on Employment: 

Figures: 

Figure 1: DOD's BRAC Leadership Structure: 

Figure 2: DOD's Selection Criteria for BRAC 2005 Round: 

Figure 3: DOD's BRAC 2005 Process: 

Figure 4: Major Base Closures with Plant Replacement Values Exceeding 
$100 Million: 

Figure 5: Major Base Realignments with a Net Loss of 400 or More 
Military and Civilian Personnel: 

Figure 6: Estimated Net Annual Recurring Savings: 

Figure 7: Analytical Process Leading to BRAC Recommendations: 

Figure 8: Selected Attributes, Metrics, and Data Questions Used to 
Assess Military Value for a Technical Facility: 

Figure 9: Selected Attributes, Metrics, and Data Questions Used to 
Assess Military Value of an Army Installation: 

Figure 10: Selected Attributes, Metrics, and Data Questions Used to 
Assess Military Value of Naval Aviation Operations: 

Figure 11: Selected Attributes, Metrics, and Data Questions Used to 
Assess Military Value of Fighter Aircraft: 

Figure 12: Realignment of Fighter Aircraft at Lambert-St. Louis Air 
Guard Station and Otis Air National Guard Base: 

Figure 13: Selected Attributes, Metrics, and Data Questions Used to 
Assess Military Value of Flight Training: 

Figure 14: Selected Attributes, Metrics, and Data Questions Used to 
Assess Military Value of Major Administrative and Headquarters 
Activities: 

Figure 15: Selected Attributes, Metrics, and Data Questions Used to 
Assess Military Value of Depot Maintenance Activities: 

Figure 16: Selected Attributes, Metrics, and Data Questions Used to 
Assess Military Value of an Intelligence Facility: 

Figure 17: Selected Attributes, Metrics, and Data Questions Used to 
Assess Military Value of Health Care Services: 

Figure 18: Selected Attributes, Metrics, and Data Questions Used to 
Assess Military Value of Supply and Storage Activities: 

Figure 19: Selected Attributes, Metrics, and Data Questions Used to 
Assess Military Value of a Technical Facility: 

Letter July 1, 2005: 

Congressional Committees: 

It has been 10 years since the Department of Defense (DOD) last 
conducted a base realignment and closure (BRAC) round.[Footnote 1] As a 
result of prior BRAC rounds in 1988, 1991, 1993, and 1995, DOD reports 
that it has reduced its domestic infrastructure by about 20 percent in 
terms of plant replacement value,[Footnote 2] transferred hundreds of 
thousand of acres of unneeded property to other federal and nonfederal 
entities, and saved billions of dollars on an annual recurring basis 
for application to higher priority defense needs. Despite these 
infrastructure reductions, DOD recognized the need for additional 
closures and realignments following the 1995 closure round and made 
repeated efforts to gain congressional authorization for an additional 
closure round. 

We too have frequently reported in recent years on the long-term 
challenges DOD faces in managing its portfolio of facilities, halting 
degradation of facilities, and reducing unneeded infrastructure to free 
up funds to better maintain enduring facilities and meet other needs. 
Because of these long-standing issues, DOD's management of its support 
infrastructure has been included in our list of high-risk areas since 
1997. 

Congress authorized an additional BRAC round for 2005 with the passage 
of the National Defense Authorization Act for Fiscal Year 2002 (the 
Act).[Footnote 3] The 2002 Act essentially extended the authority of 
the Defense Base Closure and Realignment Act of 1990,[Footnote 4] which 
had authorized the 1991, 1993, and 1995 rounds, with some modifications 
for the 2005 base closure round. The BRAC legislation provides for an 
independent Defense Base Closure and Realignment Commission to review 
the Secretary of Defense's realignment and closure recommendations, 
which were publicly announced on May 13, 2005, and present its findings 
and conclusions on the Secretary's recommendations, along with its own 
recommendations to the President, by September 8, 2005. The President, 
in turn, must either approve or disapprove the Commission's 
recommendations in their entirety by September 23, 2005. If approved, 
the recommendations are forwarded to Congress, which has 45 days or 
until the adjournment of Congress to disapprove the recommendations on 
an all-or-none basis; otherwise, they become binding.[Footnote 5] If 
the President disapproves the recommendations, the Commission must 
consider the President's objections and send a revised report back to 
the President no later than October 20, 2005. The President then has 
until November 7, 2005, to forward his approval of the revised 
Commission recommendations to Congress for its review. 

Considering changes in the national security environment and emerging 
threats, along with ongoing changes in the United States defense 
strategy to address these threats and protect our homeland, DOD has 
come to realize the need to reshape its base structure to more 
effectively support its military forces. In establishing goals for the 
2005 BRAC round, the Secretary of Defense, in a November 15, 2002, 
memorandum initiating the round, expressed his interest in (1) reducing 
excess infrastructure, which diverts scarce resources from overall 
defense capability, and producing savings; (2) transforming DOD by 
aligning the infrastructure with the defense strategy; and (3) 
fostering jointness by examining and implementing opportunities for 
greater jointness across DOD. 

In the submission of his recommendations to the BRAC Commission on May 
13, 2005, the Secretary reported that his recommendations, if approved, 
would accomplish these goals. DOD reported that its 222 
recommendations, involving an unprecedented 837 closure and realignment 
actions--including 33 major base closures and 30 major realignments, 
plus numerous other closures and realignments would generate annual 
recurring savings of about $5.5 billion beginning in fiscal year 2012. 

Legislation authorizing the 2005 round maintained the requirement, 
applicable to three previous rounds, that we provide a detailed 
analysis of the Secretary's recommendations and the selection process. 
Our objectives were to (1) determine the extent to which DOD achieved 
its stated goals for BRAC 2005, (2) analyze whether DOD's selection 
process in developing recommended actions was logical and reasoned, and 
(3) identify issues regarding the recommendations that may warrant 
attention by the BRAC Commission. 

To analyze the selection process and the recommendations, we monitored 
various aspects of the process as it evolved over time leading up to 
and following the public release of the Secretary's recommendations. We 
sought to assure ourselves that DOD followed a logical, reasoned, and 
well-documented decision-making process leading to the proposed 
recommendations. Prior to the release of the recommendations, we abided 
by an agreement with DOD not to disclose details of the process due to 
the sensitivity of the information while the process evolved. With the 
approval of the large number of recommendations occurring in the final 
weeks of the process, the broad scope and complexity of the 
recommendations, and the limited time available for us to report our 
results, we generally focused greater attention following the 
announcement of the proposed closures and realignments on those issues 
affecting more than one recommendation than on issues pertaining to the 
implementation of individual recommendations. However, as time 
permitted, we visited selected installations to better gauge the 
operational and economic impact of the proposed recommendations. We 
generally experienced good access to relevant documentation and to key 
senior officials and staff involved in the BRAC process. 

We performed our work primarily at the Office of the Secretary of 
Defense (OSD), the military services' base closure offices, and the 
offices of the seven joint cross-service groups that were established 
by the Secretary to propose cross-service recommendations.[Footnote 6] 
While we did not attend deliberative meetings, we had access to minutes 
of meetings and relevant documentation, as well as opportunities to 
meet periodically with senior leadership to provide observations or 
concerns we had as the process was unfolding. We relied on DOD's Office 
of the Inspector General, Army Audit Agency, Naval Audit Service, and 
Air Force Audit Agency to validate the accuracy of the data used by the 
military services and joint cross-service groups in their decision-
making process. We met with staff members of these audit agencies 
periodically to discuss the results of their work as well as to observe 
their data validation efforts at selected locations. Based on these 
discussions and observations and a review of their reports, we believe 
the DOD data are sufficiently reliable for the purposes of this report. 
We conducted our work from October 2003, as DOD's process was 
beginning, through June 2005, shortly after the Secretary of Defense 
announced his proposed closures and realignments, in accordance with 
generally accepted government auditing standards. Further details on 
the scope and methodology are described in appendix I. 

Results in Brief: 

DOD's recommendations, if approved, would have varying degrees of 
success in achieving goals that were set forth by the Secretary of 
Defense, despite producing closure and realignment actions numbering 
more than those of all four previous rounds combined. The department's 
recommendations were dominated by relatively minor closures and 
realignments, and many were related to the reserve components.[Footnote 
7] DOD data indicate that implementing the proposed recommendations 
would reduce the defense infrastructure by about 5 percent based on the 
facilities' plant replacement value. We believe the recommendations 
overall, if approved, would produce savings. However, overall up-front 
investment costs of an estimated $24 billion are required, and there 
are limitations associated with DOD's projection of nearly $50 billion 
in net present value savings over a 20-year period.[Footnote 8] Most 
projected savings are derived from 10 percent of the 222 
recommendations. Also, much of the projected net annual recurring 
savings (47 percent) are associated with eliminating jobs currently 
held by military personnel. However, rather than reducing end-strength 
levels, DOD indicates the positions are expected to be reassigned to 
other areas, which may enhance capabilities but also limit dollar 
savings available for other uses. Without recognition that these are 
not dollar savings that can be readily applied elsewhere, this could 
create a false sense of savings available for other purposes. 
Furthermore, about $500 million of the net annual recurring savings is 
based on business process reengineering efforts, but some of the 
assumptions supporting the expected efficiency gains have not been 
validated; while savings are likely to be realized, the precise 
magnitude of savings is uncertain. For example, one of DOD's 
recommendations--to create fleet readiness centers in the Navy by 
integrating different levels of maintenance to reduce repair time--is 
estimated to yield $215 million in annual recurring savings as a result 
of overhead efficiencies, but such assumptions have not been validated 
and actual savings will be shaped by how the recommendations are 
implemented. We have previously reported on limitations in DOD's 
efforts to track and update savings from prior BRAC rounds. Our 
concerns over this issue are heightened in this BRAC round, with the 
emphasis on business process reengineering efforts, because of past 
tendencies to reduce related operating budgets in advance of actual 
savings being known and fully realized. While DOD characterized many of 
its recommendations as transformational--whereby infrastructure would 
be aligned with the defense strategy--we found that the concept of 
transformation is not well defined, and many of the recommendations 
referencing it as support for the proposed BRAC actions are more 
appropriately categorized as efforts to improve business processes. 
Some proposed actions increase emphasis on jointness, such as 
establishing a single site for initial training for the Joint Strike 
Fighter aircraft. However, the extent of joint and transformational 
progress varied, as shown by other DOD-proposed actions reflecting 
preferences to consolidate functions within rather than across 
services, and by a lack of agreement on transformational options 
despite frequent references to them in support of proposed actions. We 
are making a recommendation to the Secretary of Defense to establish 
mechanisms for tracking and periodically updating savings estimates as 
the BRAC recommendations are implemented. 

DOD's decision-making process for developing its recommendations was 
generally logical, well documented, and reasoned. DOD established a 
structured and largely sequential process for obtaining and analyzing 
data that provided an informed basis for identifying and evaluating 
BRAC options. At the same time, initial difficulties in obtaining 
complete and accurate data in a timely manner often added to overlap 
and varying degrees of concurrency between data collection efforts and 
other steps in the process. That notwithstanding, DOD's process relied 
on certified data,[Footnote 9] as required by the BRAC legislation, and 
the use of various analytical models to evaluate the data. Further, as 
the military services and joint cross-service groups assessed the 
importance of installations, facilities, and functions, they were 
consistent in following the key considerations set forth in the BRAC 
law--such as military value--although they varied somewhat in their 
analytical approaches based on unique aspects of the functions being 
evaluated. As Congress mandated, DOD updated and considered its 20-year 
force structure plan in completing its BRAC analysis.[Footnote 10] 
Further, DOD focused on the military value selection criteria as the 
predominant decision-making factor, including legislatively mandated 
emphasis for this BRAC round on such elements as homeland defense and 
surge capability. Military judgment also played a role throughout the 
process. While the effort to ensure the accuracy of the voluminous 
amounts of data used in the process proved challenging for the services 
and joint cross-service groups, the DOD Inspector General and the 
military service audit agencies played key roles in pointing out data 
limitations, fostering corrections, and improving the accuracy of the 
data used in the process through their validation efforts, and 
generally found the data sufficiently reliable to support BRAC decision 
making. 

We identified various issues regarding DOD's BRAC recommendations, as 
well as candidate recommendations[Footnote 11] that were not included 
on DOD's final list that may warrant further attention by the BRAC 
Commission. These issues include instances of lengthy payback periods, 
which is the time required to recoup up-front investment costs for 
closing or realigning a facility or function; inconsistencies in 
formulating cost and savings estimates; uncertainties in estimating 
total costs to the government for implementing recommended actions; and 
potential impacts on communities surrounding bases that are either 
losing or gaining large numbers of personnel. With respect to the 
latter issue, this BRAC round differs from prior rounds in that many 
communities will be facing increased growth with the return of 
thousands of forces from overseas locations and the consequent 
challenges of addressing increased needs in areas such as schools and 
housing. In a few instances, we identified implementation or 
operational issues related to some recommendations. We are also 
highlighting specific closure or realignment actions that were 
projected as having the potential to generate significant savings that 
the services or joint cross-service groups approved for further 
consideration, but which were either deleted or substantially revised 
by senior DOD leadership during the latter phases of the selection 
process. 

In providing oral comments on a draft of this report, DOD concurred 
with the recommendation regarding the need for a system to track and 
periodically update BRAC savings estimates. 

Background: 

As described at the beginning of this report, DOD recognized the need 
for additional base closures and realignments following the 1995 
closure round and made repeated efforts to gain congressional 
authorization for an additional closure round. Congress authorized an 
additional round for 2005 with the passage of the National Defense 
Authorization Act for Fiscal Year 2002.[Footnote 12] The 2002 Act 
essentially extended the authority of the Defense Base Closure and 
Realignment Act of 1990,[Footnote 13] which had authorized the 1991, 
1993, and 1995 rounds, with some modifications for the 2005 base 
closure round. 

In a memorandum dated November 15, 2002, the Secretary of Defense 
issued initial guidance outlining goals and a leadership framework for 
the 2005 BRAC round. In doing so, he noted that "At a minimum, BRAC 
2005 must eliminate excess physical capacity; the operation, 
sustainment and recapitalization of which diverts scarce resources from 
defense capability." However, specific reduction goals were not 
established.[Footnote 14] At the same time, the Secretary's guidance 
for the 2005 round depicted the round as focusing on more than the 
reduction of excess capacity. He said that "BRAC 2005 can make an even 
more profound contribution to transforming the Department by 
rationalizing our infrastructure with defense strategy." He further 
noted that "A primary objective of BRAC 2005, in addition to realigning 
our base structure to meet our post-Cold War force structure, is to 
examine and implement opportunities for greater joint activity." Toward 
that end, the Secretary indicated that organizationally the 2005 BRAC 
analysis would be two pronged. Joint cross-service teams would analyze 
common business-oriented functions, and the military departments would 
analyze service-unique functions. 

The Secretary of Defense established two senior groups to oversee and 
guide the BRAC 2005 process from a departmental perspective. The first 
was the Infrastructure Executive Council (IEC), which was designated 
the policy-making and oversight body for the entire process, and the 
second, a subordinate group, was the Infrastructure Steering Group 
(ISG), created to oversee the joint cross-service analyses and 
integrate that process with the military departments' own service-
unique analyses. Each of the military departments also established BRAC 
organizations, which had oversight from senior leaders. Likewise, each 
of the joint cross-service teams, under the purview of the ISG, was led 
by senior military or civilian officials, with representation from each 
of the services and relevant defense agencies. DOD's BRAC leadership 
structure is shown in figure 1. 

Figure 1: DOD's BRAC Leadership Structure: 

[See PDF for image] 

[End of figure] 

DOD developed a draft set of 77 transformational options that once 
approved, were expected to constitute a minimum analytical framework 
upon which the military departments and joint cross-service groups 
would conduct their respective BRAC analyses. Because of a lack of 
agreement among the services and OSD, the draft options were never 
formally approved, but they remained available for consideration by 
analytical teams and were referenced by some groups in support of 
various BRAC actions being considered.[Footnote 15] (See app. XV for a 
list of the draft transformational options.) To some extent, the 
analyses and recommendations of each of the services and joint cross-
service groups were also influenced by various guiding principles or 
policy imperatives developed by the respective service or joint cross-
service groups, such as the need to preserve a particular capability in 
a particular location. 

The legislation authorizing the 2005 BRAC round, enacted as part of the 
fiscal year 2002 Defense Authorization Act, required DOD to give 
priority to selection criteria dealing with military value and added 
elements of specificity to criteria previously used by DOD in prior 
BRAC rounds. Subsequently, The Ronald W. Reagan National Defense 
Authorization Act for Fiscal Year 2005[Footnote 16] codified the entire 
selection criteria and added the word "surge" to one previously used 
criterion related to potential future contingencies and mobilization 
efforts. In large measure, the final criteria closely followed the 
criteria DOD employed in prior rounds, with greater specificity added 
in some areas, as required by Congress. Figure 2 shows DOD's selection 
criteria for 2005, with changes from BRAC 1995 denoted in 
bold.[Footnote 17]

Figure 2: DOD's Selection Criteria for BRAC 2005 Round: 

* Military value criteria: 

1. The current and future mission capabilities and the impact on 
operational readiness of the total force of the Department of Defense, 
including the impact on joint warfighting, training, and readiness; 
2. The availability and condition of land, facilities, and associated 
airspace (including training areas suitable for maneuver by ground, 
naval, or air forces throughout a 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; 
3. The ability to accommodate contingency, mobilization, surge, and 
future total force requirements at both existing and potential 
receiving locations to support operations and training; 
4. The cost of operations and the manpower implications. 

* Other criteria: 
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; 
6. The economic impact on existing communities in the vicinity of 
military installations; 
7. The ability of the infrastructure of both the existing and potential 
receiving communities to support forces, missions, and personnel; 
8. The environmental impact, including the impact of costs related to 
potential environmental restoration, waste management, and 
environmental compliance activities. 

[See PDF for image]

Source: DOD and P.L. 101-510, section 2913. 

Note: Bolding denotes changes from the 1995 BRAC round. 

[End of figure]

To ensure that the selection criteria were consistently applied, OSD 
established a common analytical framework to be used by each military 
service and joint cross-service group. Each service and group adapted 
this framework, in varying degrees, to its individual activities and 
functions in evaluating facilities and functions and identifying 
closure and realignment options. Despite the diversity of bases and 
cross-service functions analyzed, each of the groups was expected to 
first analyze capacity and military value of its respective facilities 
or functions, and then to identify and evaluate various closure and 
realignment scenarios and provide specific recommendations. Scenarios 
were derived from data analysis and transformational options, as well 
as from goals and objectives each group established for itself as it 
began its work. Figure 3 depicts the expected progression of that 
process. 

Figure 3: DOD's BRAC 2005 Process: 

[See PDF for image] 

[End of figure] 

An initial part of the process involved an overall capacity analysis of 
specific locations or functions and subfunctions at specific locations. 
The analysis relied on data calls to obtain certified data to assess 
such factors as maximum potential capacity, current capacity, current 
usage, excess capacity, and capacity needed to meet surge requirements. 

The military value analysis consisted of assessments of operational and 
physical characteristics of each installation, or specific functions on 
an installation related to a specific joint cross-service group's area 
of responsibility. These would include an installation's or function's 
current and future mission capabilities, physical condition, ability to 
accommodate future needs, and cost of operations. This analysis also 
relied on data calls to obtain certified data on the various attributes 
and metrics used to assess each of the four military value criteria and 
permit meaningful comparisons between like installations/facilities 
with reference to the collective military value selection criteria. DOD 
officials used these data to develop comparative military value scores 
for each installation/facility or for categories of facilities serving 
like functions. 

The scenario development and analysis phase focused on identifying 
various realignment and closure scenarios for further analysis. These 
scenarios were to be derived from consideration of the department's 20-
year force structure plan, capacity analysis, military value analysis, 
and transformational options; applicable guiding principles, 
objectives, or policy imperatives identified by individual military 
services or joint cross-service groups; and military judgment. Each 
component had available for its use an optimization or linear 
programming model that could combine the results of capacity and 
military value analyses and other information to derive scenarios and 
sets of alternatives. The model could be used to address varying policy 
imperatives or objectives, such as minimizing the number of sites, 
minimizing the amount of excess capacity, or maximizing the average 
military value. A BRAC review group could also direct variations that 
would, for example, eliminate as much excess capacity as possible while 
maintaining an average military value at least as high as the original 
set of sites. 

OSD policy guidance has historically specified that priority 
consideration be given to military value in making closure and 
realignment decisions, but that priority was specifically mandated by 
the legislation authorizing the 2005 BRAC round. At the same time, 
historic practice and the 2005 authorizing legislation both required 
consideration of additional issues included in selection criteria 5 
through 8, detailed below: 

* Criterion 5--costs and savings: This criterion consists of measures 
of costs and savings and the payback periods[Footnote 18] associated 
with them. Each component assessed costs using the Cost of Base 
Realignment Actions (COBRA) model that was used in each of the BRAC 
rounds since 1988. Appendix XIII summarizes improvements that have been 
made to the model over time and more recently for the 2005 round. 

* Criterion 6--economic impact: This criterion measures the direct and 
indirect impacts of a BRAC action on employment in the communities 
affected by a closure or realignment. Appendix XIV provides a more 
complete description of how economic impact was assessed and the 
changes made to improve the assessment for this round. 

* Criterion 7--community infrastructure: Selection criterion 7 examines 
"the ability of the infrastructure of both the existing and potential 
receiving communities to support forces, missions, and personnel." The 
services and joint cross-service groups considered information on 
demographics, childcare, cost of living, employment, education, 
housing, medical care, safety and crime, transportation, and public 
utilities of the communities impacted by a BRAC action. 

* Criterion 8--environmental impact: Selection criterion 8 assesses 
"the environmental impact, including the impact of costs related to 
potential environmental restoration, waste management, and 
environmental compliance activities" of closure and realignment 
recommendations. In considering this criterion, the services and joint 
cross-service groups focused mainly on potential environmental impacts 
while acknowledging, when appropriate, known environmental restoration 
costs associated with an installation recommended for closure or 
realignment. Waste management and environmental compliance costs were 
factored into criterion 5. However, under OSD policy guidance, 
environmental restoration costs were not considered in the cost and 
savings analyses for evaluating individual scenarios under criterion 5. 
DOD is obligated to restore contaminated sites on military bases 
regardless of whether they are closed, and such costs could be affected 
by reuse plans that cannot be known at this time but would be budgeted 
for at a later time when those plans and costs are better identified. 

Each of the military departments produced reports with closure and 
realignment recommendations, as did each of the joint cross-service 
groups, the results of which are summarized in appendixes III through 
XII. Figures 4 and 5 show, respectively, the 33 major closures and 30 
major realignments that have been recommended by DOD where plant 
replacement values exceed $100 million for major base closures and net 
losses of 400 or more military and civilian personnel for major base 
realignments. 

Figure 4: Major Base Closures with Plant Replacement Values Exceeding 
$100 Million: 

[See PDF for image] 

[End of figure] 

Figure 5: Major Base Realignments with a Net Loss of 400 or More 
Military and Civilian Personnel: 

[See PDF for image] 

[End of figure] 

While the 2005 BRAC round, like earlier BRAC rounds, was chartered to 
focus on United States domestic bases,[Footnote 19] DOD separately had 
under way a review of overseas basing requirements that had 
implications for the domestic BRAC process. In a September 2004 report 
to Congress, the Under Secretary of Defense for Policy provided an 
update on DOD's "global defense posture review." It noted that once 
completed, the changes stemming from the review would result in the 
most profound reordering of United States military forces overseas as 
the current posture has been largely unchanged since the Korean War. 
The report noted that over the next 10 years, it is planned that up to 
70,000 military personnel would return to the United States, along with 
approximately 100,000 family members and civilian employees. It further 
noted that a net reduction of approximately 35 percent of overseas 
sites--bases, installations, and facilities--is planned. DOD had 
indicated that the domestic BRAC process would be used in making 
decisions on where to relocate forces returning to the United States 
from overseas bases. 

Separately, Congress in 2003 mandated the creation of a special 
commission to evaluate, among other things, the current and proposed 
overseas basing structure of the United States military 
forces.[Footnote 20] The Commission's observations are included in its 
May 2005 report.[Footnote 21] Among other things, the Commission cited 
the need for appropriate planning to ensure the availability of 
community infrastructure to support returning troops and to mitigate 
the impact on communities. 

DOD's Recommendations Would Have Varying Degrees of Success in 
Achieving Goals for the 2005 BRAC Round: 

The recommendations proposed by the Secretary of Defense would have 
varying degrees of success in achieving DOD's BRAC 2005 goals of 
reducing infrastructure and achieving savings, furthering 
transformation objectives, and fostering joint activity among the 
military services. While DOD proposed a record number of closure and 
realignment actions, exceeding those in all prior BRAC rounds combined, 
many proposals focus on the reserve component bases and relatively few 
on closing active bases. Projected savings are almost equally as large, 
as all prior BRAC rounds combined, but about 80 percent of the 
projected 20-year net present value savings (savings minus up-front 
investment costs) are derived from only 10 percent of the 
recommendations. While we believe the recommendations overall would 
achieve savings, up-front investment costs of about $24 billion are 
required to implement all recommendations to achieve DOD's overall 
expected savings of nearly $50 billion over 20 years. Much of these 
saving are related to eliminations of jobs currently held by military 
personnel but are not likely to result in end-strength reductions, 
limiting savings available for other purposes. Some proposed actions 
represent some progress in emphasizing transformation and jointness, 
but progress in these efforts varied without clear agreement on 
transformational options to be considered, and many recommendations 
tended to foster jointness by consolidating functions within rather 
than across military services. 

BRAC 2005 Round Differs from Past Rounds: 

The BRAC 2005 round is different from previous base closure rounds in 
terms of number of actions, projected implementation costs, and 
estimated annual recurring savings. While the number of major closures 
and realignments is just a little greater than individual previous 
rounds, the number of minor closure and realignments, as shown in table 
1, is significantly greater than those in all previous rounds combined. 

Table 1: Comparison of BRAC 2005 with Previous Rounds: 

Dollars in billions. 

1988; 
Major bases: Closures: 16; 
Major bases: Realignments: 4; 
Minor closures and realignments: 23; 
Total actions: 43; 
Costs: $2.7; 
Net annual recurring savings: $0.9. 

1991; 
Major bases: Closures: 26; 
Major bases: Realignments: 17; 
Minor closures and realignments: 32; 
Total actions: 75; 
Costs: $5.2; 
Net annual recurring savings: $2.0. 

1993; 
Major bases: Closures: 28; 
Major bases: Realignments: 12; 
Minor closures and realignments: 123; 
Total actions: 163; 
Costs: $7.6; 
Net annual recurring savings: $2.6. 

1995; 
Major bases: Closures: 27; 
Major bases: Realignments: 22; 
Minor closures and realignments: 57; 
Total actions: 106; 
Costs: $6.5; 
Net annual recurring savings: $1.7. 

Total (for previous BRAC rounds); 
Major bases: Closures: 97; 
Major bases: Realignments: 55; 
Minor closures and realignments: 235; 
Total actions: 387; 
Costs: $22.0; 
Net annual recurring savings: $7.2. 

Total (for 2005 BRAC round); 
Major bases: Closures: 33; 
Major bases: Realignments: 30; 
Minor closures and realignments: 774; 
Total actions: 837; 
Costs: $24.4; 
Net annual recurring savings: $5.5. 

Source: DOD. 

[End of table]

The large increase in minor closures and realignments is attributable 
partly to actions involving the Army National Guard, Army Reserve, Air 
National Guard, and vacating leased space. 

The costs to implement the proposed actions are $24.4 billion compared 
to a $22 billion total from the four previous rounds through 2001, the 
end of the 6-year implementation period for the 1995 BRAC 
round.[Footnote 22] The increase in costs is due partly to significant 
military construction and moving costs associated with Army 
recommendations to realign its force structure, and to recommendations 
to move activities from leased space onto military installations. For 
example, the Army projects that it will need about $2.3 billion in 
military construction funds to build facilities for the troops 
returning from overseas. Likewise, DOD projects that it will need an 
additional $1.3 billion to build facilities for recommendations that 
include activities being moved from leased space. Time will be required 
for these costs to be offset by savings from BRAC actions and this in 
turn affects the point at which net annual recurring savings can begin 
to accrue. 

Finally, the projected net annual recurring savings are $5.5 billion 
compared to net annual recurring savings of $2.6 billion and $1.7 
billion for the 1993 and 1995 rounds respectively. The increased 
savings are partly attributable to significant reductions in the number 
of military positions and business process reengineering efforts. 

Infrastructure Would Likely Be Reduced with Some Limitations Noted: 

DOD projects that the proposed recommendations would reduce excess 
infrastructure capacity, indicating that the plant replacement value of 
domestic installations would be reduced by about $27 billion, or 5 
percent. However, the projected reductions in plant replacement value 
did not account for the $2.2 billion in domestic military construction 
projects associated with relocating forces from overseas. On the other 
hand, reductions in leased space are not considered in the plant 
replacement value analysis, since leased space is not government owned. 
DOD estimates that its recommendations will reduce about 12 million 
square feet of leased space. 

DOD Projects Recommendations Would Produce Savings, but there are 
Limitations Associated with the Savings Estimates: 

DOD projects that its proposed recommendations will produce nearly $50 
billion in 20-year net present value savings, with net annual recurring 
savings of about $5.5 billion. There are limitations associated with 
the savings claimed from military personnel reductions and we believe 
there is uncertainty regarding the magnitude of savings likely to be 
realized in other areas given unvalidated assumptions regarding 
expected efficiency gains from business process reengineering efforts 
and projected savings from sustainment, recapitalization, and base 
operating support.[Footnote 23]

Table 2 summarizes the projected one-time cost, the cost or savings 
anticipated during the 6-year implementation period for the closure or 
realignment, the estimated net annual recurring savings, and the 
projected 20-year net present value costs or savings of DOD's 
recommendations.[Footnote 24]

Table 2: Projected Costs and Savings from BRAC 2005 Recommendations: 

Fiscal year 2005 constant dollars in millions. 

DOD component: Army; 
One-time (cost): ($9,963.4); 
Net implementation (cost) or savings: ($8,519.1); 
Net annual recurring (cost) or savings[A]: $497.6; 
20-year net present value (cost) or savings[B]: ($3,038.6). 

DOD component: Navy; 
One-time (cost): ($2,099.8); 
Net implementation (cost) or savings: $440.7; 
Net annual recurring (cost) or savings[A]: $753.5; 
20-year net present value (cost) or savings[B]: $7,713.7. 

DOD component: Air Force; 
One-time (cost): ($1,883.1); 
Net implementation (cost) or savings: $2,635.5; 
Net annual recurring (cost) or savings[A]: $1,248.5; 
20-year net present value (cost) or savings[B]: $14,560.3. 

DOD component: Joint cross-service groups; 
One-time (cost): ($10,466.1); 
Net implementation (cost) or savings: $1,372.8; 
Net annual recurring (cost) or savings[A]: $2,985.1; 
20-year net present value (cost) or savings[B]: $29,569.1. 

Total; 
One-time (cost): ($24,412.4); 
Net implementation (cost) or savings: ($4,070.1); 
Net annual recurring (cost) or savings[A]: $5,484.7; 
20-year net present value (cost) or savings[B]: $48,804.5. 

Source: GAO analysis of DOD data. 

[A] Projected annual recurring savings after the 6-year implementation 
period. 

[B] DOD used a 2.8 percent discount rate to calculate net present 
value. 

[End of table]

Table 2 also shows the Navy, Air Force, and joint cross-service groups 
all projecting net savings within the 6-year implementation period, as 
well as significant 20-year net savings. In contrast, because of the 
nature of the Army's proposed actions and costs, such as providing 
infrastructure for troops returning from overseas and the consolidation 
and recapitalization of reserve facilities, the Army does not achieve 
net savings either during the implementation period or within 20 years, 
based on recommendations included in its BRAC report. 

Notwithstanding these projected savings, we identified limitations or 
uncertainties about the magnitude of savings likely to be realized. As 
figure 6 shows, 47 percent of the net annual recurring savings can be 
attributed to projected military personnel reductions. About 40 percent 
($2.1 billion) of the projected net annual recurring savings can be 
attributed to savings from operation and maintenance activities, which 
include terminating or reducing property sustainment and 
recapitalization, base operating support, and civilian payroll. 
Furthermore, about $500 million of the "other" savings is based on 
business process reengineering efforts, but some of the assumptions 
supporting the expected efficiency gains have not been validated. 

Figure 6: Estimated Net Annual Recurring Savings: 

[See PDF for image] 

Note: Analysis does not include data from one classified 
recommendation. 

[End of figure] 

Military Personnel Savings: 

Much of the projected net annual recurring savings (47 percent) are 
associated with eliminating positions currently held by military 
personnel; but rather than reducing end-strength levels, DOD indicates 
the positions are expected to be reassigned to other areas, limiting 
dollar savings available for other uses. For example, although the Air 
Force projects net annual recurring savings of about $732 million from 
eliminating about 10,200 military positions, Air Force officials stated 
the active duty positions will be reinvested to relieve stress on high 
demand career fields and the reserve positions to new missions yet to 
be identified. Likewise, the Army is projecting savings from 
eliminating about 5,800 military positions, but it has no plans to 
reduce its end-strength. Finally, the Navy is projecting it will 
eliminate about 4,000 active duty military positions, which a Navy 
official noted will help it achieve the end-strength reductions already 
planned. As we noted during our review of DOD's process during the 1995 
BRAC round, since these personnel will be assigned elsewhere rather 
than taken out of the force structure, they do not represent dollar 
savings that can be readily reallocated outside the personnel 
accounts.[Footnote 25] Without recognition that these are not dollar 
savings that can be readily applied elsewhere, this could create a 
false sense of savings available for use in other areas traditionally 
cited as a beneficiary of BRAC savings, such as making more funds 
available for modernization and better maintenance of remaining 
facilities. 

Sustainment, Recapitalization, and Base Operating Support Savings: 

DOD is also projecting savings from the sustainment and 
recapitalization of facilities that are scheduled to be demolished, as 
well as from facilities that might remain in DOD's real property 
inventory when activities are realigned from one base to another. For 
example, the Industrial Joint Cross-Service Group is claiming about $20 
million in annual recurring savings from the recapitalization of 
facilities at installations responsible for destroying chemical weapons 
at three locations recommended for closure.[Footnote 26] However, the 
Army had already expected to demolish these chemical destruction 
facilities upon completing the destruction of the chemical weapons at 
each site and the Army has not identified future missions for these 
installations. As a result, we do not believe it is appropriate for the 
Industrial Joint Cross-Service Group to claim any recapitalization 
savings related to these installations. 

Likewise, DOD is projecting savings from the recapitalization and 
sustainment of facilities in cases where functions or activities would 
be realigned from one base to another. However, it is not clear to what 
extent the proposed realignments would result in an entire building or 
portion of a building being vacated, or if entire buildings are 
vacated, whether they would be declared excess and removed from the 
military services' real property inventory. Our analysis shows that the 
supply and storage group's recommendations project about $100 million 
in sustainment and recapitalization savings from realigning defense 
distribution depots. The group estimates its recommendations will 
vacate about 27 million square feet of storage space. Supply and 
storage officials told us their goal is to vacate as much space as 
possible by re-warehousing inventory and by reducing personnel spaces, 
but they do not have a specific plan for what will happen to the space 
once it is vacated. In addition, until these recommendations are 
ultimately approved and implemented, DOD will not be in a good position 
to know exactly how much space is available or how this space will be 
disposed of or utilized. As a result, it is unclear as to how much of 
the estimated $100 million in annual recurring savings will actually 
occur. 

Collectively, the issues we identified suggest the potential for 
reduced savings that are likely to be realized in the short term during 
the implementation period, which could further reduce net annual 
recurring savings realized in the long term. The short-term impact is 
that these reduced savings could adversely affect DOD's plans for using 
these BRAC savings to help offset the up-front investment costs 
required to implement the recommendations and could further limit the 
amount of savings available for transformation and modernization 
purposes. 

Savings Based on Business Process Reengineering: 

DOD projected net annual recurring savings in the "other" category as 
shown in figure 6 include about $500 million that is based on business 
process reengineering efforts. Our analysis indicates that four 
recommendations--one from the Industrial Joint Cross-Service Group and 
three from the Supply and Storage Joint Cross-Service Group--involve 
primarily business process reengineering efforts. However, the expected 
efficiency gains from these recommendations are based on assumptions 
that are subject to some uncertainty and have not been validated. For 
example, our analysis indicates that $215 million, or 63 percent, of 
the estimated annual recurring savings from the Industrial Joint Cross-
Service Group recommendation to create fleet readiness centers within 
the Navy is based on business reengineering efforts that would result 
in overhead efficiencies. Although the data suggest there is the 
potential for savings, we believe the magnitude of the savings is 
somewhat uncertain because the estimates are based on assumptions that 
have undergone only limited testing. Realizing the full extent of the 
savings would depend on actual implementation of the recommended 
actions and modifications to the Navy's supply system. The industrial 
group and the Navy assumed that combining depot and intermediate 
maintenance levels would reduce the time needed for an item to be 
repaired at the intermediate level, which in turn would reduce the 
number of items needing to be kept in inventory, as well as the number 
of items being sent to a depot for repair. These assumptions, which 
were the major determinant of the realignment savings, were reportedly 
based on historical data and pilot projects and have not been 
independently reviewed or verified by the Naval Audit Service, the DOD 
Inspector General, or us. 

Furthermore, our analysis indicates that $291 million, or about 72 
percent, of the net annual recurring savings expected from the Supply 
and Storage Joint Cross-Service Group's three recommendations are also 
based on business process reengineering. In the COBRA model, the 
savings are categorized as procurement savings and are based on the 
expanded use of performance-based logistics[Footnote 27] and reductions 
to duplicate inventory. Supply and storage group staff said that these 
savings accrue from reduced contract prices because the Defense 
Logistics Agency (DLA) will have increased buying power since it is 
responsible for purchasing many more items that before were purchased 
by each of the services. In addition, savings accrue from increased use 
of performance-based agreements,[Footnote 28] a key component of 
performance-based logistics. The group estimates DLA can save 2.8 cents 
on each contract dollar placed on performance-based agreements. In 
addition, savings result from reductions in the amount of stock that 
must be held in inventory. Supply and storage staff said that these 
savings are attributable to reductions in the cost of money, cost of 
stock losses due to obsolescence, and cost of storage. Together the 
group estimates these factors save about 17 percent of the estimated 
value of the acquisition cost of the stock that is no longer required 
to be held in inventory. These savings estimates, for the most part, 
are based on historical documentation provided by DLA, which time did 
not allow us to validate. The extent to which these same savings will 
be achieved in the future is uncertain. As noted above, how these 
actions are implemented could also affect savings. We are concerned 
that this is another area that could lead to a false sense of savings 
and lead to premature reductions in affected budgets in advance of 
actual savings being fully realized, as has sometimes occurred in past 
efforts to achieve savings through business process reengineering 
efforts. We are also concerned that it could exacerbate a problem we 
have previously identified regarding past BRAC rounds involving the 
lack of adequate systems in place to track and update savings resulting 
from BRAC actions--the focus of our recommendation for the Secretary of 
Defense. These concerns are reinforced by limitations in DOD's 
financial management systems that historically have made it difficult 
to fully identify the costs of operations and provide a complete 
baseline from which to assess savings. 

Transformation Cited as Justification for Many Recommendations Despite 
Lack of Clear Agreement on Transformational Options: 

While furthering transformation was one of the BRAC goals, there was no 
agreement between DOD and its components on what should be considered a 
transformational effort. As part of the BRAC process, the department 
developed over 200 transformational options for stationing and 
supporting forces as well as for increasing operational efficiency and 
effectiveness. The OSD BRAC office narrowed this list to 77 options, 
but agreement was not reached within the department on these options, 
so none of them were formally approved. Nonetheless, each service and 
joint cross-service group was permitted to use the transformational 
options as appropriate to support its candidate recommendations. 
Appendix XV has a list of these 77 draft options. 

Collectively, these draft options did not provide a clear definition of 
transformation across the department. The options ranged from those 
that seemed to be service specific to those that suggested new ways of 
doing business. For example, some transformational options included 
reducing the number of Army Reserve regional headquarters; optimizing 
Air Force squadrons; and co-locating various functions such as 
recruiting, military and civilian personnel training, and research, 
development and acquisition and test and evaluation, across the 
military departments. In contrast, some options suggested consideration 
of new ways of doing business, such as privatizing some functions and 
establishing a DOD agency to oversee depot-level reparables. 

While the transformational options were never formally approved, our 
analysis indicates that many of DOD's recommendations reference one or 
more of the 77 transformational options. For example, 15 of the 
headquarters and support activities group recommendations reference the 
option to minimize leased space and move organizations in leased space 
to DOD-owned space. Likewise, 37 of the Army reserve component 
recommendations reference the option to co-locate guard and reserve 
units at active bases or consolidate guard and reserve units that are 
located in proximity to one another at one location. 

Conversely, a number of the scenarios that were initially considered 
but not adopted reference transformational options that could have 
changed existing business practices. For example, the education and 
training group developed a number of scenarios--privatizing graduate 
education programs and consolidating undergraduate fixed and rotary 
wing pilot training--based on the draft transformational options, but 
none were ultimately approved by the department. 

Some Progress Made in Fostering Joint Basing: 

DOD's recommendations make some progress toward the goal of fostering 
joint activity among the military services, based on a broad definition 
of joint activity. We found that for DOD's recommendations, joint 
activity included consolidating some training functions within the same 
service, co-locating like organizations and functions on the same 
installation, and moving some organizations or functions closer to 
installations in order to further opportunities for joint training. 
Although the recommendations achieve some progress in fostering 
jointness, we found other instances where DOD ultimately adopted a 
service-centric solution even though the joint cross-service groups 
proposed a joint scenario. Table 3 shows the major recommendations that 
foster joint activity. 

Table 3: Major Recommendations Supporting Joint Activity: 

Type of joint activity: Consolidation: 

Recommended action: The education and training group is proposing to 
consolidate: 
* initial Joint Strike Fighter aircraft training for the Navy, Marine 
Corps, and Air Force at Eglin Air Force Base; 
* undergraduate navigator training for the Navy and Air Force at Naval 
Air Station Pensacola; and; 
* transportation management, religious studies, and culinary training 
among the military services; 
The medical group is proposing to establish; 
* the Walter Reed National Military Medical Center, Bethesda, Maryland, 
by consolidating the Walter Reed Army Medical Center and the National 
Naval Medical Center, and; 
* the San Antonio Regional Military Medical Center by relocating 
inpatient care from Wilford Hall Medical Center to the Brooke Army 
Medical Center; 
The headquarters and support activities group is proposing to 
consolidate the installation management functions across various bases. 

Type of joint activity: Co-location: 

Recommended action: The Army is proposing to move the Third Army 
Headquarters (Army component command to Central Command) to Shaw Air 
Force Base to be co-located with the Air Force component of Central 
Command; 
The Navy is proposing to move aircraft from Willow Grove Air Reserve 
Station to McGuire Air Force Base, and from Naval Air Station Atlanta 
to Robins Air Force Base; 
The technical group is proposing to co-locate: 
* the services' and defense agencies' extramural funding program 
managers at the National Naval Medical Center, Bethesda, Maryland and; 
* gun and ammunition research and development and acquisition to 
Picatinny Arsenal; 
The headquarters and support activities group is proposing to co-locate 
DOD investigative agencies at Quantico Marine Corps Base. 

Type of joint activity: Proximity; 
Recommended action: The Air Force is proposing to move A-10 aircraft to 
Moody Air Force Base to enhance training Army units at Fort Benning and 
Fort Stewart; 
The Army is proposing to move a special operations unit from Fort Bragg 
to Eglin Air Force Base in proximity to the Air Force's Special 
Operations Command headquarters at Hurlburt Field. 

Source: GAO analysis of DOD data. 

[End of table]

While the proposal to create joint bases by consolidating common 
installation management functions is projected to create greater 
efficiencies, our prior work suggests that implementation of these 
actions may prove challenging. The joint-basing recommendation involves 
one service being responsible for various installation management 
support functions[Footnote 29] at bases that share a common boundary or 
are in proximity to one another. For example, the Army would be the 
executive agent for Fort Lewis, Washington, and McChord Air Force Base, 
Washington, combined as Joint Base Lewis-McChord. However, as evident 
from our recent visit to both installations and discussions with base 
officials, concerns over obstacles such as seeking efficiencies at the 
expense of the mission, could jeopardize a smooth and successful 
implementation of the recommendation. 

In some cases, the joint cross-service groups proposed scenarios that 
would have merged various support functions among the services, but a 
service solution was adopted by DOD. For example, the Headquarters and 
Support Activities Joint Cross-Service Group proposed to (1) 
consolidate civilian personnel offices under a new defense agency as 
DOD implements the national security personnel system, and (2) co-
locate all military personnel centers in San Antonio, Texas, in 
anticipation of a standard military personnel system being implemented 
across the department. However, in both cases, DOD decided to 
consolidate military and civilian personnel centers within each 
service. Likewise, the Education and Training Joint Cross-Service Group 
proposed scenarios to consolidate undergraduate fixed wing training 
activities between the Air Force and the Navy and rotary wing training 
activities between the Navy and the Army to eliminate excess capacity. 
However, the proposals were not adopted because the Navy and the Air 
Force expressed concerns that this recommendation would result in 
significant permanent change of station costs for the services, 
specifically the cost of students traveling to designated training 
locations. 

DOD Developed a Generally Logical and Reasoned Process for Making BRAC 
Decisions: 

Based on our analytical work, we believe DOD established and generally 
followed a logical and reasoned process for formulating its list of 
BRAC recommendations. The process was organized in a largely sequential 
manner with a strong emphasis on ensuring that accurate data were 
obtained and used. OSD established an oversight structure that allowed 
the seven individual joint cross-service groups to play a larger, more 
visible role in the 2005 BRAC process compared to BRAC 1995. Despite 
some overlap in data collection and other phases of the process, these 
groups and the military services generally followed the sequential BRAC 
process designed to evaluate and subsequently identify recommendations 
within their respective areas, with only the Army using a separate but 
parallel process to evaluate its reserve components. DOD also 
incorporated into its analytical process several key considerations 
required by the BRAC legislation, including the use of certified data, 
basing its analysis on its 20-year force structure plan and emphasizing 
its military value selection criteria, which included homeland defense 
and surge capabilities. In addition, DOD's Inspector General and the 
military service audit agencies helped to ensure the data used during 
the BRAC process were accurate and reliable. 

BRAC Process Was Logical and Largely Sequentially Structured: 

DOD provided overall policy guidance for the BRAC process, including a 
requirement that its components develop and implement internal control 
plans to ensure the accuracy and consistency of their data collection 
and analyses. These plans also helped to ensure the overall integrity 
of the process and the information upon which OSD considered each 
group's recommendations. The BRAC recommendations, for the most part, 
resulted from a data-intensive process that was supplemented by the use 
of military judgment as needed. The process began with a set of 
sequential steps by assessing capacity and military value, developing 
and analyzing scenarios, then identifying candidate recommendations, 
which led to OSD's final list of BRAC recommendations. Figure 7 
illustrates the overall sequential analytical process DOD generally 
employed to reach BRAC recommendations. 

Figure 7: Analytical Process Leading to BRAC Recommendations: 

[See PDF for image] 

[A] A scenario is a proposal that has been declared for formal analysis 
by a military department or joint cross-service group deliberative body 
and is officially accounted for and tracked by OSD. 

[End of figure] 

It must be noted, however, that while the process largely followed the 
sequential process established by the department, initial difficulties 
associated with obtaining complete and accurate data in a timely manner 
added to overlap and varying degrees of concurrency between data 
collection efforts and other steps in the process. 

During the 2005 BRAC process, the seven individual joint cross-service 
groups played a larger, more visible role compared to their role during 
the 1995 BRAC round. Our analysis indicates that many, although not 
all, actions proposed by these groups were accepted by OSD and the 
military services. Based on lessons learned, OSD empowered these groups 
in 2005 to suggest BRAC recommendations directly to a senior-level 
group that oversaw the BRAC 2005 analysis. Moreover, we noted a closer 
coordination between these groups, the military services, and OSD than 
existed during the 1995 round. OSD's efforts to integrate the process 
among these seven joint cross-service groups with the military 
services' own efforts led to increased discussions, greater visibility, 
and more influence for the cross-service recommendations than in prior 
BRAC rounds. 

To assist in the process for analyzing and developing recommendations, 
the military services and joint cross-service groups used various 
analytical tools. These tools helped to ensure a more consistent 
approach to BRAC analysis and decision making. For example, all of the 
groups used the DOD-approved COBRA model to calculate costs, savings, 
and return on investment for BRAC scenarios and, ultimately for the 
final 222 BRAC recommendations. As noted in appendix XIII, the COBRA 
model was designed to provide consistency across the military services 
and the joint cross-service groups in estimating BRAC costs and 
savings. DOD has used the COBRA model in each of the previous BRAC 
rounds and, over time, has improved upon its design to provide better 
estimating capability. In our past and current reviews of the COBRA 
model, we found it to be a generally reasonable estimator for comparing 
potential costs and savings among various BRAC options. 

Furthermore, the military services and joint cross-service groups 
generally used a consistent process to assess and formulate BRAC 
recommendations, with one minor exception involving the Army reserve 
components. The Army created a separate yet parallel approach in 
reviewing its reserve components for several reasons, although it 
generally followed the BRAC process. With respect to its reserve 
components, the Army did not perform a military value rank-ordering of 
these various installations across the country, but instead assessed 
the relative military value that could be obtained by consolidating 
various facilities into a joint facility in specific geographical 
locales to support, among other things, reserve component training, 
recruiting, and retention efforts. This approach provided an 
opportunity for the Army reserve components to actively participate in 
the BRAC process along with the voluntary participation of the states. 
The Army reported that consulting with the states was crucial to ensure 
the support of the state governors and staff Adjutants General for 
issues related to recommendations that affected the National Guard. The 
Army's recommendations affected almost 10 percent of the Army's 4,000 
reserve components' facilities. More specifically, the Army recommended 
176 Army Reserve closures with the understanding that the state 
governors will close 211 Army National Guard facilities with the intent 
of relocating their units into 125 new Armed Forces Reserve Centers. 
The Army reports that 38 states and Puerto Rico voluntarily 
participated in the BRAC process. 

The Air Force and the Navy also reviewed their reserve components' 
installations but did so within the common analytical structure 
established by OSD, yet with some differences in approach in involving 
affected stakeholders in the process. For example, the Air Force did 
not involve state officials or its State Adjutants General as it 
analyzed and developed its BRAC recommendations. However, senior Air 
National Guard and Reserve leadership were in attendance as voting 
members of the Air Force's Base Closure Executive Group, a senior 
deliberative body for the BRAC process. The Navy also reviewed its 
reserve components, including the Marine Corps Reserves, within the 
BRAC process, and worked closely with representatives from the Navy and 
Marine Corps reserve components to consolidate units within active duty 
installations or armed forces reserve centers without affecting 
recruiting demographics. 

BRAC Process Incorporated Key Legislative Requirements: 

DOD also incorporated into its analytical process the legal 
considerations for formulating its realignment and closure 
recommendations. As required by BRAC legislation, DOD based its 
recommendations on (1) the use of certified data, (2) its 20-year force 
structure plan, and (3) military value criteria as the primary 
consideration in assessing and formulating its recommendations. 

Use of Certified Data: 

DOD collected capacity and military value data that were certified as 
to their accuracy by hundreds of persons in senior leadership positions 
across the country.[Footnote 30] These certified data were obtained 
from corporate databases and from hundreds of defense installations. 
DOD continued to collect certified data, as needed, to support follow-
up questions, cost calculations, and to develop recommendations. In 
total, DOD projects that it collected over 25 million pieces of data as 
part of the BRAC process.[Footnote 31] Given the extensive volume of 
requested data from the 10 separate groups (3 military departments and 
7 joint cross-service groups), we noted that the data collection 
process was quite lengthy and required significant efforts to help 
ensure data accuracy, particularly from joint cross-service groups that 
were attempting to obtain common data across multiple military 
components, which, because of the diverse nature of the functions and 
activities, do not always use the same data metrics. In some cases, 
coordinating data requests, clarifying questions and answers, 
controlling database entries, and other issues led to delays in the 
data-driven analysis DOD originally envisioned. As such, some groups 
had to develop strategy-based proposals. As time progressed, however, 
these groups reported that they obtained the needed data, for the most 
part, to inform and support their scenarios. The DOD Inspector General 
and the service's audit agencies played an important role in ensuring 
that the data used in the BRAC analyses were accurate and certified by 
cognizant senior officials. 

Consideration of DOD's 20-year Force Structure Plan: 

As congressionally mandated, each of the military services and the 
seven joint cross-service groups considered DOD's 20-year force 
structure plan in its analyses. DOD based its force structure plan for 
BRAC purposes on an assessment of probable threats to national security 
during a 20-year period beginning with fiscal year 2005. DOD provided 
this plan to Congress in March 2004, and as authorized by the statute, 
it subsequently updated it 1 year later in March 2005. Based on our 
analysis, updates to the force structure affected some ongoing BRAC 
analyses. For example, the Industrial Joint Cross-Service Group 
reassessed its data pertaining to overhauling and repairing ships based 
on the updated force structure outlook and decided that one of its two 
smaller shipyards--Naval Shipyard Pearl Harbor or Naval Shipyard 
Portsmouth--could close. Ultimately, the Navy decided to close the 
Portsmouth shipyard in Maine. In addition, the Navy told us it 
recalculated its capacity based on updates to the force structure plan 
and determined that there was no significant change to its original 
analysis. The other groups, such as those examining headquarters and 
support activities, education and training, or technical functions, 
considered updates to the defense 20-year force structure and 
determined the changes would have no impact on their ongoing analyses 
or the development of recommendations. 

Primary Consideration of Military Value Criteria, Which Included 
Homeland Defense and Surge: 

DOD gave primary consideration to its military value selection criteria 
in its process. Specifically, military value refers to the first four 
selection criteria in figure 2 and includes an installation's current 
and future mission capabilities, condition, ability to accommodate 
future needs, and cost of operations. The manner in which each military 
service or joint cross-service group approached its analysis of 
military value varied according to the unique aspects of the individual 
service or cross-service function. These groups typically assessed 
military value by identifying multiple attributes or characteristics 
related to each military value criterion, then identifying qualitative 
metrics and measures and associated questions to collect data to 
support the overall military value analysis. For example, figure 8 
illustrates how the Technical Joint Cross-Service Group linked several 
of its military value attributes, metrics, and data questions to the 
mandated military value criteria. 

Figure 8: Selected Attributes, Metrics, and Data Questions Used to 
Assess Military Value for a Technical Facility: 

[See PDF for image] 

[A] The BRAC military value criteria are the first four BRAC selection 
criteria. 

[B] Military value attributes are characteristics of each criterion. 
The technical group used a total of five military value attributes. 

[C] Military value metrics are measures for the attribute. The 
technical group used a total of 30 military value metrics. 

[D] The technical group used a total of 44 data call questions. 

[End of figure]

Quantitative scoring plans were developed by each military service or 
joint cross-service group assigning relative weights to each of the 
military value criteria for use in evaluating and ranking facilities or 
functions in their respective areas. Appendixes III through XII 
highlight the use and linkages of military value criteria by each 
service and joint cross-service group. 

As noted earlier, based on congressional direction, there was enhanced 
emphasis on two aspects of military value--an installation's ability to 
serve as a staging area for homeland defense missions and its ability 
to meet unanticipated surge.[Footnote 32]

* Homeland defense: Each of the three military services considered 
homeland defense roles in its BRAC analysis and coordinated with the 
U.S. Northern Command--a unified command responsible for homeland 
defense and civil support. In October 2004, the U.S. Northern Command 
contacted the Chairman of the Joint Chiefs of Staff, requesting to play 
a role in ensuring that homeland defense received appropriate attention 
in the analytical process. Our analysis shows that all three military 
departments factored in homeland defense needs, with the Air Force 
recommendations having the most impact. According to Air Force 
officials, the U.S. Northern Command identified specific homeland 
defense missions assigned to the Air Force, which they incorporated 
into its decision-making process. Navy officials likewise discussed the 
impact of potential BRAC scenarios on its maritime homeland defense 
mission with U.S. Northern Command, U.S. Strategic Command, and the 
U.S. Coast Guard. In this regard, the Navy decided to retain Naval Air 
Station Point Mugu, California, was influenced, in part, because the 
U.S. Coast Guard wanted to consolidate its West Coast aviation assets 
at this installation for homeland defense purposes. According to Army 
officials, most of the their role in supporting homeland defense is 
carried out by the Army National Guard. The U.S. Northern Command 
reviewed the recommendations and found no unacceptable risk to the 
homeland defense mission and support to civil authorities. 

* Surge: DOD left it to each military service and joint cross-service 
group to determine how surge would be considered in the their analysis. 
Generally, all the groups considered surge by retaining a certain 
percentage of infrastructure, making more frequent use of existing 
infrastructure, or retaining difficult-to-reconstitute assets. For 
example, the Technical Joint Cross-Service Group set aside 10 percent 
of its facility infrastructure for surge, while the Industrial Joint 
Cross-Service Group factored in additional work shifts in its analysis. 
The military services retained difficult-to-reconstitute assets as the 
primary driver to satisfying the statutory requirement to consider 
surge capability. Both the Army and Navy gave strong consideration to 
infrastructure that would be difficult to reconstitute, such as large 
tracts of land for maneuver training purposes or berthing space for 
docking ships. For example, the Navy has a finite number of ships and 
aircraft and would likely have to increase operating tempo to meet 
surge needs. The Air Force addressed surge by retaining sufficient 
capacity to absorb temporary increases in operations, such as 
responding to emergencies or natural catastrophic events like hurricane 
damage, and the capacity to permanently relocate all of its aircraft 
stationed overseas in the United States if needed. 

Congress also mandated four other criteria to be considered in the 
analytical process: cost and savings of the BRAC recommendations, 
economic impact on affected communities, impact on communities' 
infrastructure, and environmental impact. The extent these other 
mandated considerations influenced recommendations varied. For example, 
high cost was the primary reason the Army decided not to develop a 
recommendation to restation troops returning from overseas to 
installations with large tracts of undeveloped land that could 
potentially accommodate these moves, such as Yuma Proving Ground, 
Arizona, or Dugway Proving Ground, Utah. Despite these installations 
having the capacity to provide large training ranges, they do not have 
existing infrastructure to immediately house 3,000 to 5,000 troops 
required for the Army's new modular combat brigades.[Footnote 33] 
Initially, the Army assessed the possibility of building new 
infrastructure at these locations, but Army BRAC officials told us it 
would be too costly given that the Army's COBRA analysis showed that at 
Yuma, for example, it would cost about $2 billion to build the required 
infrastructure. As a result, the Army decided to place units returning 
from overseas at installations currently used to base other operational 
units, notwithstanding limitations in existing training capacities. 

Although there was heavy reliance on data for completing analyses, 
military judgment was also a factor throughout the entire process, 
starting with an analytical framework to base analysis of the 20-year 
force structure plan and ending with the finalized list of 222 
recommendations submitted to the BRAC Commission. Military judgment 
also played a role in decisions on how military value selection 
criteria would be captured as attributes, with associated values or 
weights. Military judgment was also applied in deciding which proposed 
scenarios or actions should move forward for additional analysis. 
Generally, military judgment was exercised at this stage to delete or 
modify a potential recommendation for reasons such as strategic 
importance, as shown in the following examples: 

* Naval Shipyard Pearl Harbor, Hawaii, which has a lower military value 
than other shipyards, was eliminated from closure consideration because 
the shipyard was considered to have more strategic significance in the 
Pacific Ocean area compared to other alternatives. 

* Tripler Army Medical Center, Hawaii, which has a lower military value 
than some other bases, was eliminated from closure consideration 
because it is the only defense medical center of significant size in 
the Pacific Ocean area. 

* Naval Station Everett, Washington, which has a lower military value 
than some other bases, was eliminated from closure consideration 
because of strategic reasons regarding the number and the locations of 
the Navy's aircraft carriers on the West Coast and in the Pacific. 

* Grand Forks Air Force Base, North Dakota, which has a lower military 
value than some other bases, was eliminated from closure consideration 
because of the belief that a strategic presence was needed in the north 
central United States. Even though Grand Forks Air Force Base was 
retained for strategic reasons, Minot Air Force Base is also located in 
North Dakota and is not affected by any BRAC recommendations. 

DOD Audit Agencies Helped to Improve the Accuracy of Data Used during 
the BRAC Process: 

The oversight roles of the DOD Inspector General and the military 
services' audit agency staff, given their access to relevant 
information and officials as the process evolved, helped to improve the 
accuracy of the data used in the BRAC process. The DOD Inspector 
General and most of the individual service audit agencies' reports 
generally concluded that the extensive amount of data used as the basis 
for BRAC decisions was sufficiently valid and accurate for the purposes 
intended. In addition, with limited exceptions, these reports did not 
identify any material issues that would impede a BRAC recommendation. 

The DOD Inspector General and the services' audit agencies played an 
important role in ensuring that the data used in the BRAC analyses were 
accurate and certified by cognizant senior officials. Their frontline 
roles and the thousands of staff days devoted to reviewing the massive 
data collection efforts associated with the BRAC process added an 
important aspect to the quality and integrity of the data used by 
military services and joint cross-service groups. Through extensive 
audits of the capacity, military value, and scenario data collected 
from field activities, these audit agencies notified various BRAC teams 
of data discrepancies for corrective action. The audit activities 
included validation of data, compliance with data certification 
requirements employed throughout the chain of command, and examination 
of the accuracy of the analytical data. While the auditors initially 
encountered problems with regard to data accuracy and the lack of 
supporting documentation for certain questions and data elements, most 
of these concerns were resolved. In addition, the auditors worked to 
ensure certified information was used for BRAC analysis. These audit 
agencies also reviewed other facets of the process, including the 
various internal control plans, the COBRA model, and other modeling and 
analytical tools that were used in the development of recommendations. 
Appendix XVI lists these organizations' audit reports related to BRAC 
2005 to the extent they were available at the time this report was 
completed. Overall, these organizational audit agencies reported the 
following: 

* The Naval Audit Service reported that it visited 214 sites, covering 
45 data calls, and audited over 8,300 questions. It concluded that the 
data appeared reasonably accurate and complete and the Navy complied 
with statutory guidance and DOD policies and procedures. 

* The Air Force Audit Agency officials told us they visited 104 
installations, reviewed over 11,110 data call responses at 126 Air 
Force locations, 8 major commands, the Air National Guard, and 
Headquarters Air Force, and concluded that data used for Air Force BRAC 
analysis were generally reliable. 

* The Army Audit Agency reported that it visited 32 installations and 3 
leased facilities and reviewed for accuracy over 2,342 responses. It 
concluded that the data was reasonably accurate and that the Army BRAC 
office had a sound process in place to collect certified data. 

* DOD Inspector General officials told us they visited about 1,550 
sites covering 29 defense agencies and organizations and reviewed over 
15,770 responses. We were told that these responses were generally 
supported, complete, and reasonable. The DOD Inspector General also 
evaluated the validity, integrity, and documentation of data used by 
the seven joint cross-service groups and found they generally used 
certified data for the BRAC analysis. 

We closely coordinated with the DOD Inspector General and the three 
service audit agencies to maximize our individual and collective 
efforts and avoid duplication. As part of this coordination, we 
observed their audit efforts at selected military installations to 
verify the scope and quality of coverage they provided throughout the 
process and to give us insights into potential issues having broader 
applicability across the entire process. We also observed the work of 
these audit agencies to better familiarize ourselves with the types of 
issues being identified and resolved, with a view toward determining 
their materiality to the overall process. 

Several Aspects of DOD's BRAC Recommendations and Rejected Proposals 
May Warrant Further Attention: 

We identified issues regarding DOD's recommendations, and other actions 
considered during the selection process that may warrant further 
attention by the BRAC Commission. Many of the issues relate to how 
costs and savings were estimated while others relate to potential 
impacts on communities surrounding bases that stand to gain or lose 
missions and personnel as a result of BRAC actions. Further, we are 
highlighting candidate recommendations that were presented during the 
selection process by either the military services or the joint cross-
service groups to senior DOD leadership within the IEC that were 
projected as having the potential to generate significant savings, and 
which were substantially revised or deleted from further consideration 
during the last few weeks or days of the selection process. Additional 
discussion of issues targeted more specifically to the work and 
recommendations of the military services and joint cross-service groups 
is included in appendixes III through XII. 

Issues with DOD's BRAC Recommendations: 

We identified a number of issues, most of which apply to a broad range 
of DOD's recommendations, that may warrant further attention by the 
BRAC Commission. In addition to the issue previously discussed 
regarding military personnel eliminations being claimed as savings to 
the department, other issues include (1) instances of lengthy payback 
periods (time required to recoup up-front investment costs), (2) 
inconsistencies in how DOD estimated costs for BRAC actions involving 
military construction projects, (3) uncertainties in estimating the 
total costs to the government to implement DOD's recommended actions, 
and (4) potential impacts on communities surrounding bases that are 
expected to gain large numbers of personnel if DOD's recommendations 
are implemented. 

Some Lengthy Payback Periods: 

Many of the 222 recommendations DOD made in the 2005 round are 
associated with lengthy payback periods, which, in some cases, call 
into question whether the department would be gaining sufficient 
monetary value for the up-front investment cost required to implement 
its recommendations and the time required to recover this investment. 
Our analysis indicates that 143, or 64 percent, of DOD's 
recommendations are associated with payback periods that are 6 years or 
less while 79, or 36 percent, of the recommendations are associated 
with lengthier paybacks that exceed the 6-year mark or never produce 
savings. DOD officials acknowledge that the additional objectives of 
fostering jointness and transformation have had some effect on 
generating recommendations with longer payback periods. Furthermore, 
our analysis shows that the number of recommendations with lengthy 
payback periods varied across the military services and the joint cross-
service groups, as shown in table 4. 

Table 4: Payback Periods for BRAC Recommendations by DOD Component: 

DOD component: Army; 
Number of recommendations: 56; 
Payback period: Immediate to 6 years: 26; 
Payback period: 7 to 9 years: 3; 
Payback period: 10 years and greater: 22; 
Payback period: Never: 5. 

DOD component: Navy; 
Number of recommendations: 53[A]; 
Payback period: Immediate to 6 years: 45; 
Payback period: 7 to 9 years: 2; 
Payback period: 10 years and greater: 6; 
Payback period: Never: 0. 

DOD component: Air Force; 
Number of recommendations: 42; 
Payback period: Immediate to 6 years: 29; 
Payback period: 7 to 9 years: 6; 
Payback period: 10 years and greater: 7; 
Payback period: Never: 0. 

DOD component: Education and training; 
Number of recommendations: 9; 
Payback period: Immediate to 6 years: 5; 
Payback period: 7 to 9 years: 0; 
Payback period: 10 years and greater: 3; 
Payback period: Never: 1. 

DOD component: Headquarters and support activities; 
Number of recommendations: 21; 
Payback period: Immediate to 6 years: 14; 
Payback period: 7 to 9 years: 2; 
Payback period: 10 years and greater: 5; 
Payback period: Never: 0. 

DOD component: Industrial; 
Number of recommendations: 17; 
Payback period: Immediate to 6 years: 13; 
Payback period: 7 to 9 years: 3; 
Payback period: 10 years and greater: 1; 
Payback period: Never: 0. 

DOD component: Intelligence; 
Number of recommendations: 2; 
Payback period: Immediate to 6 years: 0; 
Payback period: 7 to 9 years: 2; 
Payback period: 10 years and greater: 0; 
Payback period: Never: 0. 

DOD component: Medical; 
Number of recommendations: 6; 
Payback period: Immediate to 6 years: 3; 
Payback period: 7 to 9 years: 1; 
Payback period: 10 years and greater: 2; 
Payback period: Never: 0. 

DOD component: Supply and storage; 
Number of recommendations: 3; 
Payback period: Immediate to 6 years: 3; 
Payback period: 7 to 9 years: 0; 
Payback period: 10 years and greater: 0; 
Payback period: Never: 0. 

DOD component: Technical; 
Number of recommendations: 13; 
Payback period: Immediate to 6 years: 5; 
Payback period: 7 to 9 years: 5; 
Payback period: 10 years and greater: 3; 
Payback period: Never: 0. 

DOD component: Total; 
Number of recommendations: 222; 
Payback period: Immediate to 6 years: 143; 
Payback period: 7 to 9 years: 24; 
Payback period: 10 years and greater: 49; 
Payback period: Never: 6. 

DOD component: Percentage; 
Number of recommendations: 100; 
Payback period: Immediate to 6 years: 64; 
Payback period: 7 to 9 years: 11; 
Payback period: 10 years and greater: 22; 
Payback period: Never: 3. 

Source: GAO Analysis of DOD data. 

[A] While the DOD BRAC report lists 21 Navy recommendations, several of 
these have multiple actions, thus bringing the total to 53 
recommendations. 

[End of table]

As shown in table 4, the Army has five recommendations and the 
education and training group has one recommendation that never payback, 
as described below: 

* Army realignment of a special forces unit from Fort Bragg, North 
Carolina, to Eglin Air Force Base, Florida;

* Army realignment of a heavy brigade from Fort Hood, Texas, to Fort 
Carson, Colorado;

* Army realignment of a heavy brigade to Fort Bliss, Texas, and 
infantry and aviation units to Fort Riley, Kansas;

* Army reserve component consolidations in Minnesota;

* Army reserve component consolidations in North Dakota; and: 

* Education and Training Joint Cross-Service Group's establishment of 
Joint Strike Fighter aircraft training at Eglin Air Force Base, 
Florida. 

According to Army officials, their five recommendations have no payback 
because, in part, they must build additional facilities to accommodate 
the return of about 47,000 forces currently stationed overseas to the 
United States as part of DOD's Integrated Global Presence and Basing 
Strategy initiative (see app. III for further discussion of the 
restationing initiative). According to the education and training 
group, its one recommendation with no payback period is due to the high 
military construction costs associated with the new mission to 
consolidate initial training for the Joint Strike Fighter aircraft for 
the Navy, the Marine Corps and the Air Force. 

Similarly, the Army has nearly 50 percent of the total number of DOD 
recommendations with payback periods of 10 years or longer. Our 
analysis of Army data shows that these lengthy paybacks are 
attributable to many of the recommendations regarding the reserve 
components. These recommendations typically have a combination of 
relatively high military construction costs and relatively low annual 
recurring savings, which tend to lengthen the payback period. 

We also identified some portions of DOD's individual recommendations 
that are associated with lengthy payback periods for certain BRAC 
actions but are embedded within larger bundled recommendations. The 
following are a few examples: 

* A proposal initially developed by the Headquarters and Support 
Activities Joint Cross-Service Group to move the Army Matériel Command 
from Fort Belvoir, Virginia, to Redstone Arsenal, Alabama, had more 
than a 100-year payback period with a net cost over a 20-year period. 
However, the proposal did not include some expected savings that, if 
included, would have reduced the payback period to 32 years. 
Concurrently, the group developed a separate proposal to relocate 
various Army offices from leased and government-owned office space onto 
Fort Sam Houston, Texas, which would have resulted in a 3-year payback 
period. The headquarters group decided to combine these two stand-alone 
proposals into one recommendation, resulting in an expected 20-year net 
present value savings of about $123 million with a 10-year payback. 

* Many of the individual Air Force proposals involving the Air National 
Guard and Air Force Reserve had payback periods ranging from 10 to more 
than 100 years. These individual proposals were subsequently revised by 
combining them with other related proposals to produce recommendations 
that had significant savings, minimized the longer payback periods, and 
linked operational realignment actions. We found that this change 
occurred in the realignment of Lambert-St. Louis International Airport 
Air Guard Station, Missouri, which originally had a 63-year payback 
period and resulted in a 20-year net present value cost of about $22 
million. However, this realignment is now a part of the closure of Otis 
Air National Guard Base, Massachusetts, and the realignment of Atlantic 
City Air Guard Station, New Jersey. The combined recommendation results 
in a 20-year net present value savings of $336 million and a 3-year 
payback period. 

Inconsistencies in DOD's Estimated Costs for Military Construction 
Projects: 

While the military services used the COBRA model to estimate the costs 
for military construction projects needed to implement BRAC 
recommendations, we found some inconsistencies in how they estimated 
some costs associated with these projects. While the impact of these 
inconsistencies on savings is likely not as great as others noted in 
this report, it nevertheless contributes to the overall imprecision of 
the cost estimates of DOD's recommended actions. 

One area of inconsistent accounting involves the relative amounts of 
estimated support costs--such as the cost of connecting a new facility 
to existing water, sewage, and electrical systems--associated with 
military construction projects across the services. In its estimates, 
the Army considered these additional support costs as one-time costs 
whereas the Navy and the Air Force included them in the cost of the 
military construction projects for each project. By including these 
support costs in the cost of each project, the Navy and Air Force 
generally generated higher relative recurring costs than the Army for 
the recapitalization of facilities over time. Specifically, the Army 
increased its military construction cost estimates by 18.5 percent to 
account for the connection of the projected new facilities' utilities. 
The Air Force, on the other hand, increased its construction costs for 
support services from 8 to 40 percent, depending on the type of 
facility, while the Navy included support costs at only two locations. 
According to the Special Assistant to the Secretary of the Navy for 
BRAC, the Navy assigned teams to review all proposed military 
construction projects by location to determine any support costs 
necessary for connection of utilities. Our analysis shows that had the 
Army used the same methodology as the Navy and the Air Force, the Army 
would incur about $66 million in additional recapitalization costs for 
all of its proposed military construction projects. 

The services were also inconsistent in considering the costs associated 
with meeting DOD's antiterrorism force protection standards in their 
estimated costs for military construction projects.[Footnote 34] The 
Air Force increased the expected costs of its military construction 
projects by 2.3 percent, or about $18 million, to meet DOD's standards. 
Air Force officials noted that these funds would provide enhancements 
such as security barriers and blast proof windows. The Army and the 
Navy, on the other hand, did not include additional costs to meet the 
department's standards in their proposed military construction 
projects. If the Army and the Navy estimated costs similarly to the Air 
Force, the cost of their proposed military construction projects would 
have increased by about $146 million and $25 million, respectively. 

Uncertainties in Accounting for All Expected Costs or Savings to the 
Federal Government: 

DOD's cost and savings estimates for implementing its recommendations 
do not fully reflect all expected costs or savings that may accrue to 
the federal government. The BRAC legislation requires that DOD take 
into account the effect of proposed closure or realignment on the costs 
of any other activity of the department or any other federal agency 
that may be required to assume responsibility for activities at 
military installations.[Footnote 35] While the services and joint cross-
service groups were aware of the potential for these costs, estimated 
costs were not included in the cost and savings analysis because it was 
unclear what actions an agency might take in response to the BRAC 
action. One such agency was the U.S. Coast Guard, which currently 
maintains some of its ships or various units at several installations 
that are slated to close. Navy BRAC officials briefed the U.S. Coast 
Guard about its recommendations prior to the list being published, but 
the Air Force did not meet with the Coast Guard. The U.S. Coast Guard 
was still in the process of evaluating various responses to take as a 
result of the proposed BRAC actions and did not complete its analysis 
in time for it to be included in this report. 

Further, as noted earlier, estimated costs for the environmental 
restoration of bases undergoing closure or realignment are not included 
in DOD's cost and savings analyses. Such costs would be difficult to 
fully project at this point without planned reuse of the unneeded 
property being known. Consistent with the prior BRAC rounds, DOD 
excluded estimates for base environment restoration actions from its 
costs and savings analysis and in determining payback periods, on the 
premise that restoration is a liability that the department must 
address regardless of whether a base is kept open or closed and 
therefore should not be included in the COBRA analysis. Nevertheless, 
DOD did give consideration to such costs in addressing selection 
criterion 8, and included available information on estimated 
restoration costs as part of the data supporting its BRAC 
recommendations. DOD estimates that the restoration costs to implement 
its major closures would be about $949 million, as shown in table 5. 
(See fig. 4 in the Background section for a map of DOD's major base 
closures.)

Table 5: Estimated Environmental Restoration Costs for DOD's 
Recommended Major Base Closures: 

Dollars in millions. 

Army; 
Number of major closures: 14; 
Estimated environmental restoration costs[A]: $723.3. 

Navy; 
Number of major closures: 9; 
Estimated environmental restoration costs[A]: $154.5. 

Air Force; 
Number of major closures: 10; 
Estimated environmental restoration costs[A]: $71.3. 

Total; 
Number of major closures: 33; 
Estimated environmental restoration costs[A]: $949.1. 

Source: GAO analysis of DOD data. 

[A] Estimated costs include some costs not specifically reported in 
DOD's May 2005 report to the Defense Base Closure and Realignment 
Commission. While the Army and Navy generally reported these costs, the 
Air Force did not but its costs were noted in supporting documentation. 

[End of table]

Based on the data provided, the Army would incur the largest share of 
estimated restoration costs due to the closure of several ammunition 
plants and chemical depots. The largest expected costs for any one 
location across DOD, about $383 million, would be for restoration at 
Hawthorne Army Depot, Nevada. While the DOD report does not 
specifically identify the potential for some additional restoration 
costs at its installations, available supporting documentation does 
identify some additional costs. For example, the Army estimated the 
range restoration at Hawthorne Army Depot could cost from about $27 
million to $147 million, which is not included in the estimates in 
table 5. Further, the Army recognizes that additional restoration costs 
could be incurred at six additional locations that have ranges and 
chemical munitions, but these costs have not yet been determined. 

Our prior work has shown that environmental costs can be significant, 
as evidenced by the nearly $12 billion in total cost DOD expected to 
incur when all restoration actions associated with the prior BRAC 
rounds are completed. Service officials told us that the projected cost 
estimates for environmental restoration are lower, in general, because 
the environmental condition of today's bases is much better than the 
condition of bases closed during the prior BRAC rounds, primarily 
because of DOD's ongoing active base environmental restoration program. 
Nonetheless, our prior work has indicated that as closures are 
implemented, more intensive environmental investigations occur and 
additional hazardous conditions may be uncovered that could result in 
additional, unanticipated restoration and higher costs. Finally, the 
services' preliminary estimates are based on restoration standards that 
are applicable for the current use of the base property. Because reuse 
plans developed by communities receiving former base property sometimes 
reflect different uses for the property this could lead to more 
stringent and thus more expensive restoration in many cases. 

Based on experiences from prior BRAC rounds, we believe other costs are 
also likely to be incurred, although not required to be included in 
DOD's cost and savings analysis but which could add to the total costs 
to the government of implementing the BRAC round. These costs include 
transition assistance, planning grants, and other assistance made 
available to affected communities by DOD and other agencies. DOD 
officials told us that such estimates were not included in the prior 
rounds' analyses and that it was too difficult to project these costs, 
given the unknown factors associated with the number of communities 
affected and the costs that would be required to assist them. 
Additionally, as we reported in January 2005,[Footnote 36] in the prior 
four BRAC rounds, DOD's Office of Economic Adjustment, the Department 
of Labor, the Economic Development Administration within the Department 
of Commerce, and the Federal Aviation Administration provided nearly $2 
billion in assistance through fiscal year 2004 to communities and 
individuals, and according to DOD officials, these agencies are slated 
to perform similar roles for the 2005 round. However, while the 
magnitude of this assistance is unknown at this time, it is important 
to note that assistance will likely be needed in this round, as 
contrasted with prior rounds, for not only those communities that 
surround bases losing missions and personnel but also for communities 
that face considerable challenges dealing with large influxes of 
personnel and military missions. For example, DOD stated in its 2005 
BRAC report that over 100 actions significantly affect local 
communities, triggering federal assistance from DOD and other federal 
agencies. Also, as discussed more fully later, the number of bases in 
the 2005 BRAC round that will gain several thousand personnel from the 
recommended actions could increase pressure for federal assistance to 
mitigate the impact on community infrastructure, such as schools and 
roads, with the potential for more costs than in the prior rounds. 

Finally, the BRAC costs and savings estimates do not include any 
anticipated revenue from such actions as the sale of unneeded former 
base property or the transfer of property to communities through 
economic development conveyances.[Footnote 37] The potential for 
significant revenue may exist at certain locations. For example, the 
Navy sold some unneeded property from prior round actions in California 
at the former El Toro Marine Corps Air Station for about $650 million 
and the former Tustin Marine Corps Air Station for $208.5 million. The 
extent to which sales will play a role in the disposal of unneeded 
property arising from the 2005 BRAC round remains to be seen. 

Impact of BRAC Recommended Actions on Communities: 

The recommended actions for the 2005 BRAC round will have varying 
degrees of impact on communities surrounding bases undergoing a closure 
or realignment. While some will face economic recovery challenges as a 
result of a closure and associated losses of base personnel, others, 
which expect large influxes of personnel due to increased base 
activity, face a different set of challenges involving community 
infrastructure necessary to accommodate growth. 

In examining the economic impact of the 222 BRAC recommendations as 
measured by the percentage of employment, DOD data indicate that most 
economic areas across the country are expected to be affected very 
little but a few could face substantial impact. Almost 83 percent of 
the 244 economic areas affected by BRAC recommendations fall between a 
1 percent loss in employment and a 1 percent gain in 
employment.[Footnote 38] Slightly more than 9 percent of the economic 
areas had a negative economic impact of greater than 1 percent, but for 
some of these areas, the projected impact is fairly significant, 
ranging up to a potential direct and indirect loss of up to nearly 21 
percent. Almost 8 percent of the economic areas had a positive economic 
impact greater than 1 percent. Appendix XIV provides additional detail 
on our economic analyses. 

Of those communities facing potential negative economic impact, six 
communities face the potential for a fairly significant impact. They 
include communities surrounding Cannon Air Force Base, New Mexico; 
Hawthorne Army Depot, Nevada; Naval Support Activity Crane, Indiana; 
Submarine Base New London, Connecticut; Eielson Air Force Base, Alaska; 
and Ellsworth Air Force Base, South Dakota, where the negative impact 
on employment as a percent of area employment ranges from 8.5 percent 
to 20.5 percent. Our prior work has shown that a variety of factors 
will affect how quickly communities are able to rebound from the 
negative economic consequences of closures and realignments. They 
include such factors as the trends associated with the national, 
regional, and local economies; natural and labor resources; effective 
planning for reuse of base property; and federal, state, and local 
government assistance to facilitate transition planning and execution. 
In a series of reports that have assessed the progress in implementing 
closures and realignments in prior BRAC rounds, we reported that most 
communities surrounding closed bases have been faring well in relation 
to key national economic indicators--unemployment rate and the average 
annual real per capita income growth rates.[Footnote 39] In our January 
2005 report for example, we further reported that while some 
communities surrounding closed bases were faring better than others, 
most have recovered or are continuing to recover from the impact of 
BRAC, with more mixed results recently, allowing for some negative 
impact from the economic downturn nationwide in recent years. 

The 2005 round, however, also has the potential to significantly affect 
a number of communities surrounding installations, which are expected 
to experience considerable growth in the numbers of military, civilian, 
and civilian support personnel. These personnel increases are likely to 
place additional demands on community services, such as providing 
adequate housing and schools, for which the communities may not have 
adequate resources to address in the short term. The total gains can be 
much more than just those personnel with the consideration of 
accompanying families. Table 6 shows that 20 installations are expected 
to realize gains of over 2,000 military, civilian, and mission support 
contractor personnel for an aggregate increase of more than 106,000 
personnel. 

Table 6: Military Installations That Would Receive a Net Gain of Over 
2,000 Personnel due to BRAC Actions: 

Installation: Fort Belvoir, VA; 
Net gain of military personnel to an installation: 4,521; 
Net gain of civilians and mission support contractors to an 
installation: 15,837; 
Total net gain of personnel to an installation: 20,358. 

Installation: Fort Bliss, TX; 
Net gain of military personnel to an installation: 11,354; 
Net gain of civilians and mission support contractors to an 
installation: 147; 
Total net gain of personnel to an installation: 11,501. 

Installation: Fort Benning, GA; 
Net gain of military personnel to an installation: 9,221; 
Net gain of civilians and mission support contractors to an 
installation: 618; 
Total net gain of personnel to an installation: 9,839. 

Installation: Fort Sam Houston, TX; 
Net gain of military personnel to an installation: 7,648; 
Net gain of civilians and mission support contractors to an 
installation: 1,716; 
Total net gain of personnel to an installation: 9,364. 

Installation: Fort Lee, VA; 
Net gain of military personnel to an installation: 6,139; 
Net gain of civilians and mission support contractors to an 
installation: 1,205; 
Total net gain of personnel to an installation: 7,344. 

Installation: Fort Meade, MD; 
Net gain of military personnel to an installation: 682; 
Net gain of civilians and mission support contractors to an 
installation: 4,679; 
Total net gain of personnel to an installation: 5,361. 

Installation: Fort Carson, CO; 
Net gain of military personnel to an installation: 4,178; 
Net gain of civilians and mission support contractors to an 
installation: 199; 
Total net gain of personnel to an installation: 4,377. 

Installation: Fort Bragg, NC; 
Net gain of military personnel to an installation: 4,078; 
Net gain of civilians and mission support contractors to an 
installation: 247; 
Total net gain of personnel to an installation: 4,325. 

Installation: Little Rock Air Force Base, AR; 
Net gain of military personnel to an installation: 3,579; 
Net gain of civilians and mission support contractors to an 
installation: 319; 
Total net gain of personnel to an installation: 3,898. 

Installation: Fort Sill, OK; 
Net gain of military personnel to an installation: 3,444; 
Net gain of civilians and mission support contractors to an 
installation: 158; 
Total net gain of personnel to an installation: 3,602. 

Installation: Defense Finance and Accounting Service, IN; 
Net gain of military personnel to an installation: 114; 
Net gain of civilians and mission support contractors to an 
installation: 3,381; 
Total net gain of personnel to an installation: 3,495. 

Installation: Submarine Base Kings Bay, GA; 
Net gain of military personnel to an installation: 3,245; 
Net gain of civilians and mission support contractors to an 
installation: 122; 
Total net gain of personnel to an installation: 3,367. 

Installation: Marine Corps Base Quantico, VA; 
Net gain of military personnel to an installation: 446; 
Net gain of civilians and mission support contractors to an 
installation: 2,567; 
Total net gain of personnel to an installation: 3,013. 

Installation: Fort Riley, KS; 
Net gain of military personnel to an installation: 2,415; 
Net gain of civilians and mission support contractors to an 
installation: 440; 
Total net gain of personnel to an installation: 2,855. 

Installation: Naval Station Norfolk, VA; 
Net gain of military personnel to an installation: 3,447; 
Net gain of civilians and mission support contractors to an 
installation: (640); 
Total net gain of personnel to an installation: 2,807. 

Installation: Naval Air Weapons Station China Lake, CA; 
Net gain of military personnel to an installation: 154; 
Net gain of civilians and mission support contractors to an 
installation: 2,315; 
Total net gain of personnel to an installation: 2,469. 

Installation: Eglin Air Force Base, FL; 
Net gain of military personnel to an installation: 2,140; 
Net gain of civilians and mission support contractors to an 
installation: 78; 
Total net gain of personnel to an installation: 2,218. 

Installation: Aberdeen Proving Ground, MD; 
Net gain of military personnel to an installation: (3,411); 
Net gain of civilians and mission support contractors to an 
installation: 5,587; 
Total net gain of personnel to an installation: 2,176. 

Installation: Naval Shipyard Norfolk, VA; 
Net gain of military personnel to an installation: 177; 
Net gain of civilians and mission support contractors to an 
installation: 1,859; 
Total net gain of personnel to an installation: 2,036. 

Installation: Naval Air Station Jacksonville, FL; 
Net gain of military personnel to an installation: 1,902; 
Net gain of civilians and mission support contractors to an 
installation: 123; 
Total net gain of personnel to an installation: 2,025. 

Installation: Total; 
Net gain of military personnel to an installation: 65,473; 
Net gain of civilians and mission support contractors to an 
installation: 40,957; 
Total net gain of personnel to an installation: 106,430. 

Source: GAO analysis of DOD data. 

[End of table]

As shown in table 6, most of the gaining installations are Army 
installations with the gains attributable to a number of actions, 
including the return of large numbers of personnel from overseas 
locations under DOD's integrated global presence and basing strategy 
and the consolidation of various activities, such as combat-support 
related activities at Fort Lee, Virgina. Fort Belvoir, Virginia, has 
the largest expected growth, due in large measure to some consolidation 
of various activities from lease space in the Washington, D.C. area. 

The challenges facing communities surrounding gaining bases can be 
many, including increased housing demand, increased demands for roads 
and utilities, and adequate schools. These challenges can be formidable 
as communities may be faced with inadequate resources to address 
concerns in these areas as follows: 

* Housing: If history is any indication, while some of the personnel 
transferring into a base may live on-base, the majority may not, as the 
military services are turning more to housing privatization. 
Installation officials at Fort Riley, Kansas, told us about concerns 
about the nearby availability of housing (within a 20-mile radius) to 
support the expected influx of military and civilian personnel and 
their families transferring to the base. For those installations where 
adequate housing is not available in the surrounding communities 
existing housing privatization projects would need to be revised and 
expedited to provide for additional units. Fort Bliss, Texas, officials 
told us that they expect the need to accelerate their existing housing 
privatization efforts, but would require additional funds to do so. 
Currently, housing privatization has taken place or is in the process 
of taking place at several of these installations and similar efforts 
may be needed there as well. 

* Schools: Effects on bases with the greatest gain in personnel 
resulting from BRAC vary between whether dependents attend schools 
operated on base by DOD (Fort Benning, Fort Bragg, and Marine Corps 
Base Quantico as shown in table 6) or schools operated by local 
educational agencies. We recently reported on challenges likely to be 
faced by both DOD operated schools and those operated by local 
educational agencies in the post BRAC environment at these and other 
locations.[Footnote 40] Recently, in visiting selected bases affected 
by the BRAC recommendations, installation officials told us that while 
local educational authorities should be able to absorb additional 
students into their school systems, they are more concerned about the 
potential shortage of teachers. Another concern is that make-shift 
trailers or temporary modular facilities might be used. For example, 
while Kings Bay, Georgia, officials told us that the local school 
system should be able to accommodate the increase of students, it may 
need to resort to the use of portable classrooms. All installations 
that are expected to gain more than 2,000 personnel have local 
community-administrated school systems with the exceptions of Fort 
Benning, Fort Bragg, and Marine Corps Base Quantico which have DOD-
administrated school systems. If additional capacity is required at 
these three locations, additional military constructions funds would 
likely be needed. 

* Other infrastructure: Installation officials we spoke to also 
expressed some concern for the increased demand for various community 
services, such as health care, transportation, and utilities to 
accommodate personnel increases. Fort Carson, Colorado, officials told 
us that with its expected personnel increases, the local community will 
need more TRICARE providers to meet the expected demand. In other 
cases, such as at Fort Belvoir, Virgina, discussion has ensued 
regarding the need for increased mass transit capability, which may 
involve requests for millions of dollars in federal grant assistance. 

As previously noted, it is likely that these concerns may increase 
federal governmental expenditures that are not included in the BRAC 
cost and savings analyses. 

Candidate Recommendations That Were Deleted or Revised during the Final 
Weeks of the Selection Process: 

We also identified several candidate recommendations that were 
presented by the military services or joint cross-service groups to the 
IEC--DOD's senior BRAC leadership group--that were substantially 
revised or deleted from further consideration during the last few weeks 
of the BRAC section process. In aggregate, based on projected savings, 
these actions reduced the overall potential for estimated net annual 
recurring savings by nearly $500 million and estimated 20-year net 
present value savings by over $4.8 billion, as shown in table 7. 

Table 7: Candidate Recommendations That Were Deleted or Significantly 
Revised by the Infrastructure Executive Council: 

Dollars in millions. 

Proposals deleted by the IEC: 

Candidate recommendations: Close Naval Postgraduate School, CA; 
Initial proposal: Net annual recurring savings: $90; 
Initial proposal: 20-year savings: $1,120; 
IEC decision: Net annual recurring savings: $0; 
IEC decision: 20-year savings: $0; 
Change: Net annual recurring savings: ($90); 
Change: 20-year savings: ($1,120). 

Candidate recommendations: Close Uniformed Services of the University 
of the Health Sciences, MD; 
Initial proposal: Net annual recurring savings: $58; 
Initial proposal: 20-year savings: $575; 
IEC decision: Net annual recurring savings: $0; 
IEC decision: 20-year savings: $0; 
Change: Net annual recurring savings: ($58); 
Change: 20-year savings: ($575). 

Candidate recommendations: Close Natick Soldier Systems Center, MA; 
Initial proposal: Net annual recurring savings: $20; 
Initial proposal: 20-year savings: $114; 
IEC decision: Net annual recurring savings: $0; 
IEC decision: 20-year savings: $0; 
Change: Net annual recurring savings: ($20); 
Change: 20-year savings: ($114). 

Candidate recommendations: Close Adelphi Laboratory Center, MD; 
Initial proposal: Net annual recurring savings: $166; 
Initial proposal: 20-year savings: $949; 
IEC decision: Net annual recurring savings: $144; 
IEC decision: 20-year savings: $1,026; 
Change: Net annual recurring savings: ($22); 
Change: 20-year savings: $77. 

Candidate recommendations: Close Carlisle Barracks, PA; 
Initial proposal: Net annual recurring savings: $50; 
Initial proposal: 20-year savings: $555; 
IEC decision: Net annual recurring savings: $0; 
IEC decision: 20-year savings: $0; 
Change: Net annual recurring savings: ($50); 
Change: 20-year savings: ($555). 

Candidate recommendations: Close Air Force Institute of Technology, OH; 
Initial proposal: Net annual recurring savings: $8; 
Initial proposal: 20-year savings: $14; 
IEC decision: Net annual recurring savings: $0; 
IEC decision: 20-year savings: $0; 
Change: Net annual recurring savings: ($8); 
Change: 20-year savings: ($14). 

Proposals changed from closure to realignment by the IEC: 

Close Marine Corps Logistics Base, Barstow, CA; 
Initial proposal: Net annual recurring savings: $142; 
Initial proposal: 20-year savings: $1,600; 
IEC decision: Net annual recurring savings: $18; 
IEC decision: 20-year savings: $231; 
Change: Net annual recurring savings: ($124); 
Change: 20-year savings: ($1,369). 

Candidate recommendations: Close Naval Air Station, Brunswick, ME; 
Initial proposal: Net annual recurring savings: $93; 
Initial proposal: 20-year savings: $841; 
IEC decision: Net annual recurring savings: $35; 
IEC decision: 20-year savings: $239; 
Change: Net annual recurring savings: ($58); 
Change: 20-year savings: ($602). 

Candidate recommendations: Close Grand Forks Air Force Base, ND; 
Initial proposal: Net annual recurring savings: $226; 
Initial proposal: 20-year savings: $2,656; 
IEC decision: Net annual recurring savings: $173; 
IEC decision: 20-year savings: $1,982; 
Change: Net annual recurring savings: ($53); 
Change: 20-year savings: ($674). 

Candidate recommendations: Close Rome Laboratory, NY; 
Initial proposal: Net annual recurring savings: $46; 
Initial proposal: 20-year savings: $230; 
IEC decision: Net annual recurring savings: $41; 
IEC decision: 20-year savings: $357; 
Change: Net annual recurring savings: ($5); 
Change: 20-year savings: $127. 

Total; 
Initial proposal: Net annual recurring savings: $899; 
Initial proposal: 20-year savings: $8,654; 
IEC decision: Net annual recurring savings: $411; 
IEC decision: 20-year savings: $3,835; 
Change: Net annual recurring savings: ($488); 
Change: 20-year savings: ($4,819). 

Source: GAO analysis of DOD data. 

[End of table]

Each of the cases highlighted in the table is described in additional 
detail below. 

* The educational and training group proposed to privatize graduate 
education, which enabled the Navy to recommend the closure of the Naval 
Postgraduate School, Monterey, California. The proposed closure 
supported DOD's draft transformational option to privatize graduate-
level education. Navy officials, however, stated that they believed 
professional military education was more important than ever given the 
world climate. During the IEC deliberations, Navy officials expressed 
concern about the loss of such a unique graduate military education 
facility and the effect on international students who participate in 
the school's programs. Further, in the IEC meeting the Navy stated its 
belief that all education recommendations should be withdrawn because 
education is a core competency of the department and relying on the 
private sector to fulfill that requirement is too risky. The IEC agreed 
and disapproved the recommendation. 

* The Medical Joint Cross-Service Group recommended that the Uniformed 
Services University of the Health Sciences associated with the National 
Naval Medical Center in Bethesda, Maryland, be closed, citing that 
educating physicians at the site was more costly than alternative 
scholarship programs (about triple the cost) and that the department 
could rely on civilian universities to educate military 
physicians.[Footnote 41] We also reported previously that the 
university is a more costly way to educate military 
physicians.[Footnote 42] The IEC, subsequently disapproved the 
recommendation, citing that education is a core competency for the 
department, and therefore it was considered too risky to rely on the 
private sector to provide this function. Also, a DOD official indicated 
that, with the recommended action to realign Walter Reed Army Medical 
Center to Bethesda, Maryland, it would be highly desirable to have a 
military medical college associated with this medical facility in order 
for it to be a world-class medical center. 

* The Technical Joint Cross-Service Group, through the Army, proposed 
that the Natick Soldier Systems Center, Massachusetts, be closed and 
technical functions relocated to Aberdeen Proving Ground, Maryland, to 
create an integrated command, control, communications, and computers, 
intelligence, surveillance, and reconnaissance center. In its 
presentation to the IEC, the Army noted that the cost for this 
recommendation was high, but it would generate greater efficiencies and 
faster transition from research and development through the acquisition 
and fielding phases of the technology. Although the ISG initially 
raised no concerns and approved the recommendation, the IEC disapproved 
it in the last week of the BRAC selection process, citing the high cost 
of the recommendation. 

* The closure of the Adelphi Laboratory Center, Maryland, was 
originally part of the recommendation to close Fort Monmouth, New 
Jersey, and, along with Natick Soldier Systems Center, was part of the 
Army's plan for an integrated command, control, communications, and 
computers, intelligence, surveillance, and reconnaissance center. An 
Army official told us that, as with the closure of Natick, no concerns 
were originally raised and the recommendation was approved by the ISG, 
but the IEC later removed it from the recommendation that includes the 
closure of Fort Monmouth because of high cost. 

* The proposed closure of Carlisle Barracks, Pennsylvania--home of the 
Army War College--was initiated by the Education and Training Joint 
Cross-Service Group and was aimed at creating synergy between the 
college and Army's Command and General Staff College at Fort 
Leavenworth, Kansas. The IEC approved the proposed recommendation when 
it was initially briefed, but later rejected it, based on the Army's 
argument that among other things, the Army War College's proximity to 
Washington, D.C., provides access to key national and international 
policymakers and senior military and civilian leaders within DOD. 

* The Education and Training Joint Cross-Service Group recommended the 
closure of the Air Force Institute of Technology at Wright-Patterson 
Air Force Base, Ohio. The group recommended that graduate-level 
education be provided by the private sector and that all other 
functions of the institute be relocated to Maxwell Air Force Base, 
Alabama. However, the IEC disapproved the recommendation based on the 
risk involved in relying on the private sector for education 
requirements, given that education is a core competency of the 
department. 

* The Industrial Joint Cross-Service Group recommended transferring the 
workload of the Marine Corps' depot maintenance facility in Barstow, 
California, which enabled the Department of the Navy to recommend 
closure of the Marine Corps Logistics Base. The Marine Corps raised 
concerns over the impact that the closure would have on Marine Corps 
deployments from the West Coast. The IEC decided to downsize the base 
and retain the depot, citing the Marine Corps' concerns. 

* While the Navy recommended closure of the Naval Air Station 
Brunswick, Maine, the IEC revised this to a realignment. Navy officials 
stated that the senior Navy leadership had been reluctant to give up 
the Navy's remaining air station in the Northeast region, but found the 
potential savings significant enough to recommend closure. Navy 
officials stated that the IEC relied on military judgment to retain 
access to an airfield in the Northeast. Nonetheless, all aircraft and 
associated personnel, equipment, and support as well as the aviation 
intermediate maintenance capability will be relocated to another Navy 
base. The Navy is maintaining its cold weather-oriented Survival, 
Evasion, Resistance and Escape School, a Navy Reserve Center, and other 
small units at the air station. 

* While the Air Force had proposed to close Grand Forks Air Force Base, 
North Dakota,[Footnote 43] the IEC revised this to a realignment a week 
before OSD released its recommendations. The Air Force reported in its 
submission to the BRAC Commission that over 80 percent of the base's 
personnel are expected to be eliminated or realigned under the revised 
proposal. The revision to keep the base open was made based on military 
judgment to keep a strategic presence in the north central United 
States, with a possible unmanned aerial vehicle mission for the base. 
Even though Grand Forks Air Force Base was retained for strategic 
reasons, Minot Air Force Base is also located in North Dakota and is 
not affected by any BRAC recommendation. 

* The closure of Rome Laboratory, New York, was originally part of a 
Technical Joint Cross-Service Group recommendation to consolidate the 
Defense Research Laboratories. No concerns were originally raised about 
the closure, and it was approved by the IEC. However, the IEC 
subsequently decided to realign rather than close the laboratory to 
address strategic presence and cost concerns. The realignment of Rome 
has a higher 20-year net present value savings than the closure 
proposal because the closure would have required more military 
construction and transfers of military and civilian personnel and 
equipment. 

Conclusions: 

While we believe DOD's overall recommendations, if approved and 
implemented would produce savings, there are clear limitations 
associated with the projected savings, such as the lack of military end-
strength reductions and uncertainties associated with other savings 
estimates. DOD's recommendations would provide net reductions in space 
and plant replacement value, which would reduce infrastructure costs 
once up-front investment costs have been recovered but the extent some 
projected space reductions will be realized is unclear. Other DOD 
savings estimates are based on what might be broadly termed business 
process reengineering efforts and other actions, where savings appear 
likely, but the magnitude of savings has not been validated and much 
will depend on how the recommended actions are implemented. 
Nevertheless, the savings could prove difficult to track over time. As 
a result, DOD's projections may create a false sense of the magnitude 
of the savings, with fewer resources available for force modernization 
and other needs than might be anticipated, and there may be the 
potential for premature budget reductions. Given problems in tracking 
savings from previous BRAC rounds, and the large volume of BRAC actions 
this round that are more oriented to realignments and business process 
reengineering than closures, we believe it is of paramount importance 
that DOD put in place a process to track and periodically update its 
savings estimates. 

Despite a fundamentally sound overall process, we identified numerous 
issues regarding DOD's list of recommendations that may warrant further 
attention by the BRAC Commission, as noted in this report and 
appendixes III through XII. These include those recommendations having 
lengthy payback periods, some with limited savings relative to 
investment costs, and potential implementation difficulties. Given the 
large number of such items for the Commission's consideration, we are 
not addressing them as individual recommendations but simply referring 
our report in its entirety for the Commission's consideration. 

Recommendation for Executive Action: 

We recommend that the Secretary of Defense take appropriate steps to 
establish mechanisms for tracking and periodically updating savings 
estimates in implementing individual recommendations, with emphasis 
both on savings related to the more traditional realignment and closure 
actions as well as those related more to business process 
reengineering. 

Agency Comments: 

Cognizant officials of the military services and joint cross-service 
groups reviewed drafts of the report providing us with informal 
comments, permitting us to make technical changes, as appropriate, to 
enhance the accuracy and completeness of the report. Subsequently, we 
similarly provided complete drafts of the report to cognizant OSD 
officials, obtaining and incorporating their comments as appropriate. 
In providing oral comments on a draft of this report, the Deputy Under 
Secretary of Defense for Installations and Environment concurred with 
our recommendation. 

We are sending copies of this report to Members of Congress; the 
Secretaries of Defense, the Army, the Navy, and the Air Force; the 
Commandant of the Marine Corps; the Director, Office of Management and 
Budget; and the Chairman, Defense Base Closure and Realignment 
Commission. We will also make copies available to others upon request. 
In addition, the report will be available at no charge on GAO's Web 
site at [Hyperlink, http://www.gao.gov]. 

If you or your staff have any questions about this report, please 
contact me on (202) 512-5581 or [Hyperlink, holmanb@gao.gov]. Contact 
points for our Offices of Congressional Relations and Public Affairs 
may be found on the last page of this report. GAO staff who made major 
contributions to this report are listed in appendix XVII. 

Signed by: 

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 Kay Bailey Hutchison: 
Chairman: 
The Honorable Dianne Feinstein: 
Ranking Minority Member: 
Subcommittee on Military Construction and Veterans Affairs: 
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 C.W. Bill Young: 
Chairman: 
The Honorable John P. Murtha: 
Ranking Minority Member: 
Subcommittee on Defense: 
Committee on Appropriations: 
House of Representatives: 

The Honorable James Walsh: 
Chairman: 
The Honorable Chet Edwards: 
Ranking Minority Member: 
Subcommittee on Military Quality of Life and Veterans Affairs, and 
Related Agencies: 
Committee on Appropriations: 
House of Representatives: 

[End of section]

Appendixes: 

Appendix I: Scope and Methodology: 

Prior to the release of the Department of Defense's (DOD) base 
realignment and closure (BRAC) recommendations on May 13, 2005, we 
monitored the BRAC process in a real-time environment beginning in 
October 2003. We sought to assure ourselves that DOD followed an 
objective and consistently applied process in which we could observe 
logical decision making leading to defensible and well-documented 
proposed closure and realignment recommendations. During this period, 
we abided by an agreement with DOD to not disclose details of the 
process due to the sensitivity of the information. Following the 
release of the recommendations, we continued our analyses of the 
process and recommendations. With the unprecedented large number of 
recommendations and the finalization of many of these occurring in the 
final weeks of the process, along with the limited time available for 
us to report our results following DOD's May 13, 2005, release of the 
recommendations, we were not able to review all recommendations in 
detail. We focused more of our attention on cross-cutting issues than 
on implementation issues of individual recommendations, but did review 
individual recommendations as time permitted. Further, because of time 
constraints, we had only limited opportunities to gain further insight 
into some of the recommendations from officials at bases affected by 
the recommendations. 

We performed our work primarily at the Office of the Secretary of 
Defense (OSD), the military services' base closure offices, and the 
offices of seven joint cross-service groups[Footnote 44] that were 
established by OSD to develop cross-service recommendations. While we 
did not attend deliberative meetings, we had access to minutes of 
meetings and relevant documentation and met periodically with key staff 
and senior leadership to gain an understanding of each phase of the 
process and to provide them with the opportunity to address our 
concerns as the process was unfolding. We also visited selected bases 
following the public disclosure of the Secretary's recommendations to 
gain further insights into potential issues regarding specific 
recommendations. Those bases included the Anniston Army Depot, Alabama; 
Fort Bliss, Texas; Fort Carson, Colorado; Fort Sam Houston, Texas; Fort 
Lewis, Washington; Fort Riley, Kansas; Lackland Air Force Base, Texas; 
McChord Air Force Base, Washington; Marine Corps Air Station Cherry 
Point, North Carolina; Naval Shipyard Portsmouth, Maine; Naval 
Submarine Base Kings Bay, Georgia; Naval Submarine Base New London, 
Connecticut; and Red River Army Depot, Texas. We also met with 
officials of the U.S. Coast Guard to discuss the impact of BRAC actions 
on their operations since they are tenants on several bases recommended 
for closure or realignment. We relied on DOD's Office of the Inspector 
General, Army Audit Agency, Naval Audit Service, and Air Force Audit 
Agency to validate the data used by the military services and joint 
cross-service groups in their decision-making processes. We met with 
staff of these audit agencies periodically to discuss the results of 
their work as well as to observe their data validation efforts at 
selected locations across the country. The DOD Inspector General and 
service audit agencies issued reports that generally concluded that the 
extensive amount of data used as the basis for BRAC decisions was 
sufficiently valid and accurate for the purposes intended. In addition, 
with limited exceptions, these reports did not identify any material 
issues that would impede a BRAC recommendation.[Footnote 45] Where 
questions existed, we made further assessments and were able to satisfy 
ourselves that issues raised would have limited, if any, impact on the 
department's recommendations. Based on the audit agencies' extensive 
validation efforts and our observation of their work, we believe the 
data are sufficiently reliable for the purposes of this report. 

To determine the extent to which DOD achieved its BRAC goals, we 
interviewed key officials and collected and analyzed relevant 
documentation generated by OSD, the military departments, and the joint 
cross-service groups. We reviewed the Secretary of Defense's November 
2002 memorandum that initiated the 2005 BRAC process and highlighted 
DOD's goals and obtained DOD officials' views on the degree to which 
the goals were accomplished. With respect to DOD's goal of reducing 
excess capacity, we initially reviewed the capacity analysis reports of 
the services and joint cross-service groups to gain insight into the 
relative amounts of excess capacity within the department. We 
subsequently reviewed major recommendations to determine the extent to 
which these recommended actions would reduce infrastructure and excess 
capacity. In this regard, we also assessed the changes in the overall 
defense infrastructure's plant replacement value--a measure used by the 
department to determine the cost to replace an existing facility with a 
facility of the same size at the same location, using today's 
standards--by reviewing supporting documentation for the 
recommendations. We also analyzed the aggregated estimated costs and 
savings associated with reducing DOD's unnecessary infrastructure, as 
depicted in the Cost of Base Realignment Actions (COBRA) analyses for 
the 222 recommendations proposed by the department, and compared these 
estimates with similar data from the prior BRAC rounds to determine 
similarities and differences in sources of costs and savings and 
thereby identify potential areas for further review. With respect to 
DOD's costs and savings estimates, we examined selected supporting 
documentation to determine the basis for the estimates and identified 
key elements, such as base operating support, personnel compensation, 
or recapitalization of facilities, those estimates comprised. 

We also performed a qualitative analysis of DOD's performance in 
addressing its other BRAC goals--transforming the infrastructure and 
fostering jointness--by examining DOD's proposed recommendations and 
seeking views from key officials on the relative success of achieving 
these initiatives. We also compared the justification narratives 
supporting individual recommendations for closures and realignments 
against draft transformation options developed by the department, 
although not formally adopted, that were nonetheless used by the 
individual military services and joint cross-service groups. Our 
efforts in addressing this and other objectives were facilitated by 
remote access to selected automated databases and tracking systems, 
which gave us near real-time access to relevant briefings and other 
documents, permitting us to broadly track the evolution of the BRAC 
process and identify issues for further consideration. 

To address whether DOD's selection process for developing 
recommendations was logical and reasoned, we focused on key aspects of 
the BRAC process, including capacity and military value analyses. In 
doing so, we sought to determine whether DOD's selection process was 
objective and in compliance with key considerations of BRAC 
legislation. Our monitoring of the process from the start permitted us 
to assess the extent to which the process followed was logical, 
sequential, reasoned, and well documented. Our monitoring permitted us 
to determine to what extent a logical and sequential flow existed among 
all phases of DOD's selection process from the point at which data were 
collected and analyzed through the compilation of the final 
recommendations. We reviewed the services' determinations of which 
installations to consider in the BRAC process and analyzed the 
services' and joint cross-service groups' excess capacity analyses and 
military value evaluation plans and analyses to determine if they were 
developed in a reasoned fashion and supported by appropriate 
documentation. In reviewing military value analyses, we reviewed 
specific attributes established by the services and joint cross-service 
groups and examined the linkage between the groups' methodologies and 
the military value selection criteria (i.e., criteria 1 through 4) to 
determine if these mandated selection criteria were addressed. 
Regarding the development of recommendations, our focus was to 
determine whether the recommendations were developed in a logical and 
reasoned manner. We reviewed, among other things, the extent to which 
the services and joint cross-service groups (1) considered various 
alternative proposals for closure or realignment, (2) assessed proposed 
recommendations using military value as the predominant decision-making 
factor, and (3) considered the remaining four selection criteria as 
mandated by law. 

To address issues regarding DOD's recommendations, we focused more of 
our attention on cross-cutting issues than on implementation issues of 
individual recommendations, but did review individual recommendations 
as time permitted. We reviewed recommendation justification packages 
that included particulars on the benefits of implementing the 
recommendations from an operational perspective, the estimated costs 
and savings associated with implementing the recommendations, and their 
degree of conformity to the mandated selection criteria. We discussed 
perceived benefits with key officials and reviewed appropriate 
supporting documentation. We also examined financial aspects of the 
recommended actions, including expected up-front investment costs to 
implement the actions, length of payback periods, net present value 
savings or costs over a 20-year period, and annual recurring savings or 
costs. In examining the expected costs and savings as generated by 
DOD's COBRA model, we further examined assumptions and specific 
calculations regarding specific recommendations to determine the 
relative reasonableness of the estimates, given the data available to 
the services and the joint cross-service groups using the COBRA model. 
Further, we examined and discussed with DOD officials the economic and 
community impact for selected closure and realignment actions, 
including both adverse impacts associated with closing bases as well as 
challenges facing bases and surrounding communities that stand to 
receive large influxes of military personnel, civilian personnel, or 
both. Additionally, we reviewed potential recommendations that were 
approved by either the services or joint cross-service groups but 
ultimately rejected by senior leadership, the Infrastructure Executive 
Council, during the last few weeks of the BRAC process. We examined the 
merits of these proposals as presented by the services or joint cross-
service groups in terms of addressing DOD's BRAC goals. We further 
reviewed the rationale offered by senior leadership in its decisions to 
reject or substantially revise the offered proposals. Because of time 
limitations and complexities introduced by DOD in weaving together the 
unprecedented 837 closures and realignment actions across the country 
into 222 recommendations, we focused more on evaluating major issues 
affecting more than one recommendation than on implementation issues of 
individual recommendations. However, as time permitted, we did visit 
several selected installations, as noted above, to better gauge the 
operational and economic impact of the proposed recommendations. 
Installations visited were selected on a judgment basis because of our 
desire to have additional information on issues of concern, such as 
those related to costs and savings, potential operational implications, 
and potential economic impact. They included a number of bases with 
industrial-type activities because of concerns in prior rounds about 
how well the BRAC process and the COBRA model deal with such issues and 
other aspects of those facilities that permitted us to address other 
issues of concern. 

We conducted our work from October 2003, as DOD's process was 
beginning, through June 2005, shortly after the Secretary of Defense 
announced his proposed base closures and realignments, in accordance 
with generally accepted government auditing standards. 

[End of section]

Appendix II: Glossary of BRAC-Related Terms: 

The following terms were used by DOD during the 2005 BRAC process. 

* Annual recurring savings: Savings that are expected to occur annually 
after the costs of implementing a BRAC action have been offset by 
savings. 

* Candidate recommendation: A scenario that a joint cross-service group 
or military department has formally analyzed against all eight 
selection criteria and which it recommends to the Infrastructure 
Steering Group and Infrastructure Executive Council respectively for 
approval by the Secretary of Defense. A joint cross-service group 
candidate recommendation must be approved by the Infrastructure 
Steering Group, the Infrastructure Executive Council, and the Secretary 
of Defense before it becomes a DOD recommendation. A military 
department candidate recommendation must be approved by the 
Infrastructure Executive Council and the Secretary of Defense before it 
becomes a DOD recommendation. 

* Certified data: P.L. 101-510, section 2903 (c)(5) requires specified 
DOD personnel to certify to the best of their knowledge and belief that 
information provided to the Secretary of Defense or the 2005 Defense 
Base Closure and Realignment Commission concerning the realignment or 
closure of a military installation is accurate and complete. 

* Closure: All missions of the installation have ceased or have been 
relocated. All personnel positions (military, civilian, and contractor) 
have either been eliminated or relocated, except for personnel required 
for caretaking, conducting any ongoing environmental restoration, and 
disposing of base property. 

* COBRA: An analytical tool used to calculate the costs, savings, and 
return on investment of proposed realignment and closure actions. 

* Force structure plan: Numbers, size, and composition of the units 
that comprise U.S. defense forces, for example, divisions, air wings, 
aircraft, tanks, and so forth. 

* Infrastructure Executive Council (IEC): One of two senior groups 
established by the Secretary of Defense to oversee and operate the BRAC 
2005 process. The IEC, chaired by the Deputy Secretary of Defense, 
composed of the Secretaries of the military departments and their 
chiefs of services, the Chairman of the Joint Chiefs of Staff, and 
Under Secretary of Defense (Acquisition, Technology, and Logistics), 
was the policy-making and oversight body of the entire BRAC 2005 
process. 

* Infrastructure Steering Group (ISG): The subordinate of two senior 
groups established by the Secretary of Defense to oversee the BRAC 2005 
process. The ISG, chaired by the Under Secretary of Defense 
(Acquisition, Technology, and Logistics), and composed of the Vice 
Chairman of the Joint Chiefs of Staff, the Service Vice Chiefs, Deputy 
Under Secretary of Defense (Installations and Environment), and the 
Military Department Assistant Secretaries of Defense (Installations and 
Environment), provided oversight to joint cross-service group analyses 
of common business and support functions and ensured the integration of 
that process with the military departments' and defense agencies' 
specific analyses of all other functions. 

* Losing installation: An installation from which missions, units, or 
activities would cease or be relocated pursuant to a closure or 
realignment recommendation. An installation can be a losing 
installation for one recommendation and a receiving installation for a 
different recommendation. 

* Military installation: A base, camp, post, station, yard, center, 
homeport facility for any ship, or other activity under the 
jurisdiction of the Department of Defense, including any leased 
facility. The term does not include any facility used primarily for 
civil works, river and harbor projects, flood control, or other 
projects not under the primary jurisdiction or control of the 
Department of Defense. 

* Military value: Referring to one or more of the first four BRAC 
selection criteria, which are collectively referred to as the military 
value criteria and are expected to receive priority consideration in 
the analytical process that results in recommendations for the closure 
or realignment of military installations within the United States. 

* Net present value: In the context of BRAC, net present value is 
taking into account the time value of money in calculating the value of 
future cost and savings. 

* Payback period: The time required for cumulative estimated savings to 
exceed the cumulative estimated costs incurred in net present value 
terms as a result of implementing BRAC actions. 

* Realignment: Includes any action that both reduces and relocates 
functions and civilian personnel positions, but does not include a 
reduction in force resulting from workload adjustments, reduced 
personnel or funding levels, or skill imbalances. 

* Receiving installation: An installation to which missions, units, or 
activities would be relocated pursuant to a closure or realignment 
recommendation. An installation can be a receiving installation for one 
recommendation and a losing installation for a different 
recommendation. 

* Scenario: A proposal that has been declared for formal analysis by a 
military department or joint cross-service group deliberative body. The 
content of a scenario is the same as the content of a proposal. The 
only difference is that it has been declared for analysis by a 
deliberative body. Once declared, a scenario was registered at the ISG 
by inputting it into the ISG BRAC Scenario Tracking Tool. 

* Surge: A term incorporated in one of the military value selection 
criteria for the 2005 BRAC round: "the ability to accommodate 
contingency, mobilization, surge, and future total force requirements." 
The term is not otherwise defined and application of the term can vary 
by specific operational or support categories. 

* Transformation: According to the department's April 2003 
Transformation Planning Guidance document, transformation is "a process 
that shapes the changing nature of military competition and cooperation 
through new combinations of concepts, capabilities, people, and 
organizations that exploit our nation's advantages and protect against 
our asymmetric vulnerabilities to sustain our strategic position, which 
helps underpin peace and stability in the world."

[End of section]

Appendix III: The Department of the Army Selection Process and 
Recommendations: 

The Army generally followed the common analytical framework established 
by the Office of the Secretary of Defense (OSD) for reviewing its 
active component installations and followed a separate parallel process 
for its reserve components installations. Compared to prior rounds, the 
Army's process produced a record number of 56 recommendations, with 44 
of them directed to its reserve components and 12 directed to the 
active component, recognizing that many of the individual 
recommendations contain multiple closure and realignment actions. The 
44 reserve components recommendations involved realignment or closure 
actions that could have been approved outside of the BRAC process, but 
the Army and DOD decided to include them as part of DOD's efforts to 
aid transformation through the base realignment and closure 
process.[Footnote 46] Unlike the other military services and joint 
cross-service groups, the Army's recommendations, while producing 
estimated net annual recurring savings of nearly $500 million after 
2011, are not expected to achieve overall net savings over the 20-year 
period typically used to measure net savings from BRAC actions. Over 
this 20-year period, the Army expects to incur a net present value cost 
over $3 billion, which is due primarily to the very large up-front 
costs in a few recommendations that are necessary to return forces to 
the United States under DOD's Integrated Global Presence and Basing 
Strategy.[Footnote 47] However, the financial outlook for the Army 
improves if joint cross-service recommendations involving Army bases 
are considered--these separately reported actions are expected to 
produce $10.7 billion in net present value savings over a 20-year 
period. Payback periods--the time required for savings to offset 
closure costs--for the active component recommendations are projected 
to average 2.5 years with a range of immediate to no payback, and 
average 12.3 years with a range of immediate to more than 100 years for 
the reserve components. We believe some of the Army's recommendations 
may warrant additional attention from the BRAC Commission due to the 
likelihood of overstated savings projections associated with military 
personnel eliminations, uncertainties regarding overseas restationing 
of forces to the United States and other ongoing force structure 
changes, challenges facing communities surrounding bases that are 
gaining large numbers of personnel, the bundling of various 
recommendations, various unknowns associated with implementing the 
reserve components' recommendations, and issues regarding the proposed 
closure of the Red River Army Depot in Texas. The Army Audit Agency, 
which performed audits of the data used in the process, concluded that 
the data were sufficiently reliable for use in BRAC. 

Organization and Focus: 

The Army established a Senior Review Group, headed by the Vice Chief of 
Staff of the Army and the Under Secretary of the Army and comprising 
senior Army military and civilian personnel, responsible for assessing 
potential recommendations for consideration by the Secretary of the 
Army, who in turn was to forward recommended actions to the 
Infrastructure Executive Council (IEC) for approval.[Footnote 48] This 
group was supported by The Army Basing Study Group, headed by the 
Deputy Assistant Secretary of the Army for Infrastructure Analysis, 
which was responsible for collecting and analyzing data and developing 
recommendations. In addition, subject matter experts and 
representatives from the Army's major commands provided expertise and 
input throughout the BRAC process. 

The Army's broadly stated goals for BRAC 2005 were to enhance the 
capabilities of a transforming Army while aligning its infrastructure 
to meet its post-Cold War force structure and eliminating excess 
physical capacity to provide ready combat power to Combatant 
Commanders. Some key planning and strategy documents provided guidance 
in the pursuit of Army goals. The Army Stationing Strategy, for 
example, provided an overall vision, principles, and goals relative to 
future basing decisions while DOD's Strategic Planning Guidance helped 
to define objectives regarding soldiers' well-being. In further 
defining its goals, the Army identified the capabilities and missions 
that its installations require to support its forces in the future. 
With these needs in mind, the Army set out numerous objectives, such 
as: 

* locate Army forces and Matériel (at critical installations) to 
enhance deployment and redeployment;

* relocate forces in accordance with the Integrated Global Presence and 
Basing Strategy;

* reshape installations to support home station mobilization and 
demobilization;

* reshape reserve components infrastructure to improve efficiency of 
mobilization and demobilization; and: 

* provide sufficient area and facilities (with varied terrain, climate, 
and airspace) to support institutional training, combat development, 
and doctrine development. 

Framework for Analysis: 

The Army's BRAC analysis included a review of 87 active component 
installations and 10 leased facilities. A separate effort was 
undertaken to review over 4,000 Army National Guard and Army Reserve 
facilities to explore infrastructure consolidation opportunities that 
would afford the reserve components better facilities and enhance, 
among other things, training and operations.[Footnote 49] Army 
officials indicated that differences in the objectives and the nature 
of facilities associated with the active and reserve components 
infrastructure made it impractical to use identical review and decision-
making processes. As with previous BRAC rounds, capacity and military 
value analyses provided the starting point for the Army's decision-
making process. A key focus in the Army's efforts was to preserve large 
maneuver areas to ensure that future training requirements could be met 
and to relocate missions and personnel from small, single-function 
installations to larger, multi-function installations. The Army Audit 
Agency played an important role in helping to ensure data accuracy 
through extensive audits of data gathered at various locations. 

The Army's BRAC process was made more challenging by two ongoing force 
structure and basing initiatives--the rebasing of thousands of Army 
forces and their families to the United States as a result of the 
Integrated Global Presence and Basing Strategy and the restructuring of 
the Army's forces under its modularity[Footnote 50] program--that were 
to be integrated into the BRAC process. 

Capacity Analysis: 

The Army initiated its capacity analysis by collecting capacity-related 
data for its active duty installations (e.g., buildings, land) based on 
28 capacity metrics, such as buildable acres, maneuver areas, and 
instructional facilities. In calculating capacity excesses or shortages 
through a comparison of the physical capacity data with requirements, 
the Army considered a surge capability to ensure that sufficient 
capacity existed to meet unforeseen military contingencies, future 
threats, and future needs as outlined in DOD's 20-year force structure 
plan. The Army's surge analysis also reinforced the importance of 
preserving assets such as maneuver land that would be difficult to 
reconstitute if eliminated. Table 8 shows selected Army's capacity 
results for 7 of 12 mission areas, as presented in the Army's BRAC 2005 
report. 

Table 8: Excess Capacity Identified by the Army for Selected Mission 
Areas: 

Mission: Deployment; 
Capacity metrics: Fixed wing runway, surfaced; 
Percentage of excess capacity (shortage): 28.6%. 

Mission: Deployment; 
Capacity metrics: Aircraft apron, surfaced; 
Percentage of excess capacity (shortage): (17.9%). 

Mission: Mobilization; 
Capacity metrics: Vehicle maintenance shop; 
Percentage of excess capacity (shortage): (20.3%). 

Mission: Mobilization; 
Capacity metrics: Annual training/mobilization barracks; 
Percentage of excess capacity (shortage): (56.9%). 

Mission: Institutional training and education; 
Capacity metrics: General instructional facilities; 
Percentage of excess capacity (shortage): (8.4%). 

Mission: Institutional training and education; 
Capacity metrics: Applied instructional facilities; 
Percentage of excess capacity (shortage): (18.6%). 

Mission: Well-being; 
Capacity metrics: Medical center/hospital; 
Percentage of excess capacity (shortage): 9.2%. 

Mission: Well-being; 
Capacity metrics: Dental facility; 
Percentage of excess capacity (shortage): (6.9%). 

Mission: Well-being; 
Capacity metrics: Enlisted unaccompanied personnel housing; 
Percentage of excess capacity (shortage): (6.3%). 

Mission: Well-being; 
Capacity metrics: Education center; 
Percentage of excess capacity (shortage): (4.5%). 

Mission: Well-being; 
Capacity metrics: Nursery and child care facility; 
Percentage of excess capacity (shortage): (43.5%). 

Mission: Joint logistics; 
Capacity metrics: Depot maintenance; 
Percentage of excess capacity (shortage): 24.7%. 

Mission: Joint logistics; 
Capacity metrics: Armaments production; 
Percentage of excess capacity (shortage): 219.9%. 

Mission: Joint logistics; 
Capacity metrics: Ammunition storage; 
Percentage of excess capacity (shortage): 65.9%. 

Mission: Command, control, computers and communications/headquarters; 
Capacity metrics: General administrative space; 
Percentage of excess capacity (shortage): 4.9%. 

Mission: Command, control, computers and communications/headquarters; 
Capacity metrics: Small unit headquarters; 
Percentage of excess capacity (shortage): (41.9%). 

Mission: Command, control, computers and communications/headquarters; 
Capacity metrics: Large unit headquarters; 
Percentage of excess capacity (shortage): (11.5%). 

Mission: Research, development, test and evaluation; 
Capacity metrics: Specialized training facilities; 
Percentage of excess capacity (shortage): 61.9%. 

Source: GAO analysis of the Department of the Army data. 

[End of table]

As shown in table 8, some areas, such as armaments production and 
ammunition storage, had excess capacity ranging from about 5 percent to 
about 220 percent while other areas had shortages. Further, the Army 
reported that it had a service-wide excess of over 1.5 million square 
feet of general administrative space even though 35 installations 
reported shortages. While the Army's BRAC report did not indicate the 
overall impact the Army's proposed closure and realignment 
recommendations would have on reducing excess capacity, Army officials 
projected that its proposed actions would reduce excess general 
administrative space by over 1 million square feet while realigning 
Army units to better match the remaining capacity. 

While the overall capacity excesses and shortages, identified by 
installation, provided insights for potential closures or realignments, 
the Army subsequently conducted more detailed capacity analyses that 
identified the types of facilities and training lands that were 
required to support various units (e.g., light and heavy maneuver 
brigades, small and large training schools). In this manner, the Army 
had the ability to determine which installations could handle 
additional missions and units and what infrastructure improvements and 
additional military construction might be required to support those 
units. 

The Army did not perform a similar capacity assessment of the reserve 
components' facilities because of the nature of their facilities and 
differing objectives, but did collect and assess data related to, for 
example, the condition and location of facilities, as well as expected 
costs such as construction and force protection upgrades that may be 
necessary to provide for viable reserve consolidation opportunities. 
Prior to the collection of this data, the Army sought interest from the 
state Adjutant Generals of the National Guards for units in each state 
participating in such efforts on a voluntary basis. 

Military Value Analysis: 

The Army's military value analysis focused on a set of 40 attributes, 
such as maneuver land, and housing availability for its soldiers and 
dependents, that are characteristics the Army considered desirable for 
its installations to meet Army needs. Attributes with less flexibility 
for change, such as the availability of maneuver land or direct fire 
ranges, were among those most highly valued in developing a scoring 
plan for evaluating the military value for each of the Army's 
installations. According to Army officials, this reflected their view 
of the criticality of possessing adequate acreage to conduct unit 
training, particularly in view of the expectation for an increase in 
the number of brigades and return of various forces from overseas 
locations. The Army's military value attributes also reflected 
consideration of its role in supporting the global war on terrorism, 
homeland defense, and transformation.[Footnote 51] Through a process of 
weighting each of the Army's attributes, the Army derived relative 
weights for the four legislatively-mandated military value selection 
criteria. As shown in table 9, three of the four criteria had 
relatively higher weights than the remaining criterion dealing with 
cost and manpower implications. Embedded within these criteria was a 
key focus on the need for availability of existing land and facilities 
for expansion purposes to address the needs as cited in those specific 
criteria. In this regard, the Army placed high value on these criteria 
as a hedge against uncertain future requirements and to ensure that 
they did not dispose of assets such as large tracts of land, which 
would be difficult to reacquire. 

Table 9: Army Military Value Criteria Weights: 

Figures in percentages. 

Criteria: 1. The current and future mission capabilities and the impact 
on operational readiness of the total force of the Department of 
Defense, including the impact on joint warfighting, training, and 
readiness; 
29%. 

Criteria: 2. The availability and condition of land, facilities, and 
associated airspace (including training areas suitable for maneuver by 
ground, naval, or air forces throughout a 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; 
29%. 

Criteria: 3. The ability to accommodate contingency, mobilization, 
surge, and future total force requirements at both existing and 
potential receiving locations to support operations and training; 
32%. 

Criteria: 4. The cost of operations and the manpower implications; 
10%. 

Total: 100%. 

Source: DOD and Department of the Army. 

Note: The system of weights provided a basis for assigning relative 
value to data collected and tabulated across each military value 
dimension. 

[End of table]

In performing its military value assessment, the Army assessed each 
active duty installation and ranked each of them across the four 
military value selection criteria to more fully evaluate the potential 
for realignment and closure actions. This contrasted with the approach 
the Army used in the 1995 BRAC round when it developed a military value 
ranking for individual installations under one of 13 mission 
categories, which made it more difficult to assess an installation for 
use in a different mission area. For this round, the Army assessed the 
military value of each of its installations based on a common framework 
that linked attributes, metrics, and data call questions to military 
value as shown in figure 9. 

Figure 9: Selected Attributes, Metrics, and Data Questions Used to 
Assess Military Value of an Army Installation: 

[See PDF for image] 

[A] The BRAC military value criteria are the first four BRAC selection 
criteria. 

[B] Military value attributes are characteristics of each criterion. 
The Army used a total of 40 attributes. 

[C] Military value metrics are measures for the attributes. The Army 
used over 80 metrics. 

[D] The Army used over 80 data call questions. 

[End of figure] 

During its assessment, the Army stressed multi-function capabilities 
for installations. To account for the unique capabilities that some 
Army single-function installations provided, the Army applied military 
judgment to modify the initial ranking of its installations to better 
identify installations that the Army believed were best suited to meet 
its current and future capabilities. For example, the Tripler Army 
Medical Center in Hawaii, which initially ranked low in military value, 
is DOD's only medical center of significant size in the Pacific and 
therefore was retained for strategic reasons. Ultimately, the Army 
moved nine installations higher in the list based on their unique 
capabilities.[Footnote 52] Subsequently, those installations with a 
lower military value ranking became more vulnerable to closure or 
realignment actions. 

With respect to its reserve components, the Army did not perform a 
military value rank-ordering of these various installations across the 
country, but instead assessed the relative military value that could be 
obtained by consolidating various facilities into a joint facility in 
specific geographical locales to support, among other things, the 
reserve components' training, recruiting, and retention efforts. 

Army Audit Agency's Role in the Process: 

Throughout the BRAC process, the Army Audit Agency advised the Army on 
the development and implementation of its internal control procedures; 
performed audits of the Army's conduct of the process, including the 
validation of data and various models used to assist in decision 
making. During the capacity and military value data calls, the Army 
Audit Agency performed on-site audits of data collection efforts at 
various installations on a sample basis to validate the data being 
gathered. Instances of inaccurate data or inadequate source 
documentation identified during these audits were generally corrected 
by the Army. As a result, the auditors generally found the data to be 
sufficiently reliable for use in the BRAC process. 

Identification and Assessment of Alternate Scenarios and Selection of 
Recommendations: 

The Army used the results of its capacity and military value analyses, 
along with the 20-year force structure plan, as the foundation for the 
development of hundreds of potential closure and realignment scenarios. 
Scenarios under consideration were refined using various models--
primarily an optimization model and the Cost of Base Realignment 
Actions (COBRA) model--along with military judgment. The optimization 
model, using capacity data, military value scores, and other data, 
provided the Army with various competing, plausible alternatives 
associated with the restationing of various missions and forces within 
the infrastructure. The model provided for alternative scenarios and 
their impact on overall military value as functions were moved to 
higher ranked installations. The COBRA model, which was used by all 
military services and joint cross-service groups to address the fifth 
selection criterion regarding costs and savings, provided the Army with 
the relative cost and savings estimates of these various alternatives. 

The Army further assessed the various scenarios in terms of the 
remaining selection criteria 6 through 8, regarding the economic impact 
on communities affected by BRAC, the ability of the infrastructure 
within communities to support military missions, and the environmental 
impact of the BRAC actions, respectively. The Army used input from 
various DOD-generated models in assessing its scenarios against these 
criteria, which, while important and mandated by the BRAC legislation, 
played less of a role than that of military value. However, the Army 
considered these criteria in order to ensure that there were no 
insurmountable challenges that would derail the implementation of any 
particular scenario. In addition, they were used to differentiate 
between competing scenarios. For example, the Army determined its final 
stationing of modular brigades based in part on its assessment of the 
environmental impact these brigades would have on the receiving 
installations. 

The Army also integrated into the overall process those scenarios that 
had been generated for the reserve components in the parallel process 
referred to previously. Those scenarios were developed through a series 
of meetings with state officials across the country. As with the active 
component, the reserve component scenarios were assessed using the 
COBRA model and other models. 

The Army also worked closely with the joint cross-service groups as 
they developed recommendations that affected Army installations. In 
some cases, the Army developed scenarios that were provided to the 
joint cross-service groups for further consideration. For example, the 
Army developed initial scenarios proposing to close three chemical 
demilitarization facilities, which were subsequently provided to the 
Industrial Joint Cross-Service Group, which ultimately developed and 
processed recommendations for these closures. Alternatively, some 
scenarios which ultimately became Army recommendations were developed 
in conjunction with the joint cross-service groups. For example, the 
Industrial Joint Cross-Service Group's scenario regarding the 
realignment of the depot maintenance workload out of the Red River Army 
Depot in Texas, was instrumental in leading to an ultimate Army 
recommendation to close the depot. Similarly, the Education and 
Training Joint Cross-Service Group developed a scenario to realign the 
Army's Armor Center and School from Fort Knox, Kentucky to Fort 
Benning, Georgia, an action that was later folded into the Army's 
broader realignment of Fort Knox. As the Army and cross-service group 
recommendations were being finalized, the Army held a series of 
meetings with the joint cross-service groups to ensure that all 
recommended actions involving Army installations were properly 
integrated and corresponding impacts were considered in their entirety. 

Recommendations Approved by DOD: 

The Army produced 56 recommendations[Footnote 53] that were approved by 
DOD--6 closures of active component installations, 6 realignments of 
active component installations, and 44 recommendations consisting of 
multiple reserve components closure and realignment actions grouped by 
state or region. These recommendations, along with other Army-related 
recommendations produced by the joint cross-service groups, align, for 
the most part, with the Army's objectives of reducing the number of 
primarily single-function, smaller installations and transforming the 
infrastructure to better meet current and expected future Army needs. 
Table 10 provides the financial implications of the Army's 
recommendations. 

Table 10: Financial Aspects of the Army's Recommendations: 

Fiscal year 2005 constant dollars in millions. 

Installations: Reserve Components[C]; 
DOD report page: Army-25 to 120; 
One-time (costs): ($2,856.8); 
Net implementation (costs) or savings[A]: ($1,557.4); 
Net annual recurring (costs) or savings: $322.8; 
Payback period (years): 12.3 average; 
20-year net present value (costs) or savings[B]: $1,598.6. 

Installations: Close Fort Monmouth, NJ; 
DOD report page: Army-11; 
One-time (costs): ($822.3); 
Net implementation (costs) or savings[A]: ($395.6); 
Net annual recurring (costs) or savings: $143.7; 
Payback period (years): 6; 
20-year net present value (costs) or savings[B]: $1,025.8. 

Installations: Realign Maneuver Training[D]; 
DOD report page: Army-20; 
One-time (costs): ($773.1); 
Net implementation (costs) or savings[A]: ($244.1); 
Net annual recurring (costs) or savings: $123.3; 
Payback period (years): 5; 
20-year net present value (costs) or savings[B]: $948.1. 

Installations: Close Fort McPherson, GA; 
DOD report page: Army-8; 
One-time (costs): ($197.8); 
Net implementation (costs) or savings[A]: $111.4; 
Net annual recurring (costs) or savings: $82.1; 
Payback period (years): 2; 
20-year net present value (costs) or savings[B]: $895.2. 

Installations: Close Fort Monroe, VA; 
DOD report page: Army-19; 
One-time (costs): ($72.4); 
Net implementation (costs) or savings[A]: $146.9; 
Net annual recurring (costs) or savings: $56.9; 
Payback period (years): 1; 
20-year net present value (costs) or savings[B]: $686.6. 

Installations: Close Red River Army Depot, TX; 
DOD report page: Army-16; 
One-time (costs): ($456.2); 
Net implementation (costs) or savings[A]: ($216.6); 
Net annual recurring (costs) or savings: $76.5; 
Payback period (years): 4; 
20-year net present value (costs) or savings[B]: $539.0. 

Installations: Close Fort Gillem, GA; 
DOD report page: Army-6; 
One-time (costs): ($56.8); 
Net implementation (costs) or savings[A]: $85.5; 
Net annual recurring (costs) or savings: $35.3; 
Payback period (years): 1; 
20-year net present value (costs) or savings[B]: $421.5. 

Installations: Close U.S. Army Garrison (Selfridge) MI; 
DOD report page: Army-106; 
One-time (costs): ($9.5); 
Net implementation (costs) or savings[A]: $91.4; 
Net annual recurring (costs) or savings: $18.1; 
Payback period (years): immediate; 
20-year net present value (costs) or savings[B]: $260.9. 

Installations: Realign Single Drill Sergeant School[E]; 
DOD report page: Army-105; 
One-time (costs): ($1.8); 
Net implementation (costs) or savings[A]: $7.6; 
Net annual recurring (costs) or savings: $2.5; 
Payback period (years): immediate; 
20-year net present value (costs) or savings[B]: $31.3. 

Installations: Realign Fort Wainwright, AK; 
DOD report page: Army-5; 
One-time (costs): ($0.1); 
Net implementation (costs) or savings[A]: $0.2; 
Net annual recurring (costs) or savings: $0.1; 
Payback period (years): 2; 
20-year net present value (costs) or savings[B]: $0.7. 

Installations: Realign Fort Bragg, NC; 
DOD report page: Army-10; 
One-time (costs): ($334.8); 
Net implementation (costs) or savings[A]: ($446.1)[F]; 
Net annual recurring (costs) or savings: ($23.8); 
Payback period (years): never; 
20-year net present value (costs) or savings[B]: ($639.2). 

Installations: Realign Fort Hood, TX; 
DOD report page: Army-15; 
One-time (costs): ($435.8); 
Net implementation (costs) or savings[A]: ($579.5); 
Net annual recurring (costs) or savings: ($45.3); 
Payback period (years): never; 
20-year net present value (costs) or savings[B]: ($980.4). 

Installations: Realign Operational Army (IGPBS)[G]; 
DOD report page: Army-22; 
One-time (costs): ($3,946.0); 
Net implementation (costs) or savings[A]: ($5,229.0); 
Net annual recurring (costs) or savings: ($294.7); 
Payback period (years): never; 
20-year net present value (costs) or savings[B]: ($7,826.7). 

Total; 
One-time (costs): ($9,963.4); 
Net implementation (costs) or savings[A]: ($8,519.1); 
Net annual recurring (costs) or savings: $497.6; 
20-year net present value (costs) or savings[B]: ($3,038.6). 

Source: GAO analysis of DOD data. 

[A] This represents net costs or savings within the 6-year 
implementation period required to implement BRAC recommendations. 

[B] DOD used a 2.8 percent discount rate to calculate net present 
value. 

[C] The Army produced 44 recommendations realigning its reserve 
components, which are combined into one entry in the table. 

[D] This recommendation primarily stations a modular brigade and some 
overseas forces at Fort Knox, Kentucky while realigning the Armor 
Center and School to Fort Benning, Georgia. 

[E] This recommendation realigns the drill sergeant schools from Fort 
Benning, Georgia and Fort Leonard Wood, Missouri to Fort Jackson, South 
Carolina. 

[F] The Army BRAC 2005 report mistakenly reported this figure as a 
savings rather than a cost. The Army subsequently issued a correction. 

[G] This recommendations primarily restations some overseas forces at 
Fort Bliss, Texas and Fort Riley, Kansas. 

[End of table]

As shown in table 10, the Army's recommendations are expected to 
produce nearly $500 million in estimated net annual recurring savings 
beginning in 2012, but have a large 20-year net present value cost of 
about $3 billion, rather than savings which are typically expected in 
that timeframe; this is due primarily to very large up-front costs, 
nearly $10 billion in expected one-time costs, that are required to 
implement the recommendations. A few of the recommendations, 
particularly the one involving the redeployment of Army forces to the 
United States under DOD's Integrated Global Presence and Basing 
Strategy, are responsible for the high costs and negative returns. 

The recommended closures of 6 active duty installations, which are 
largely installations of lower military value within the Army, have the 
greatest potential for savings with a combined estimated net present 
value savings over the next 20 years of about $3.8 billion and payback 
periods of 6 years or less. Most of the expected savings from these 
recommendations are due to reductions in personnel costs and overhead 
(e.g., base operations support). Expected personnel savings from these 
6 recommendations are driven by the elimination of nearly 3,500 
personnel of which nearly 25 percent, or over 800, are military. 

While 3 of the remaining 6 active duty base realignment recommendations 
as shown in table 10 also produce savings, 3 recommendations account 
for more than $9.4 billion in 20-year net present value costs and will 
never payback. The largest of these three latter recommendations 
involves the rebasing of Army forces to the United States from overseas 
locations. The Army projected that this realignment alone has a one-
time cost of about $4 billion and annual recurring costs of almost $300 
million and will never produce savings. Army officials note that a 
contributory factor to these high costs is the fact that the Army could 
not claim the estimated savings that would accrue from the expected 
closure of the overseas installations and the departure of Army forces 
from those locations. The Army estimates that had these estimated 
savings been accounted for in BRAC, the recommended actions would have 
produced substantial net savings rather than the costs as indicated. We 
did not validate the Army's savings estimates for the overseas 
closures, and it is not clear to us that sufficient information is 
available at this time to fully assess the total changes in overseas 
basing costs since much of the detail regarding these plans has not 
been finalized. Further, we agree with DOD that it would not be 
appropriate for the Army to include these particular savings in BRAC as 
BRAC provisions in existing legislation do not contemplate 
consideration of savings from the closure or realignments that take 
place outside of the United States.[Footnote 54]

With regard to the reserve components, the Army adopted 44 
recommendations, which taken as a whole, would provide a net present 
value savings of over $1.5 billion over the next 20 years but have an 
average payback period of over 12 years. Five of the recommendations 
involve the realignment of the Army Reserve's command and control 
structure within five regional areas. The remaining recommendations 
realign reserve components facilities in 38 states and Puerto Rico by 
constructing 125 new armed forces reserve centers while closing 176 
Army Reserve centers and with the understanding that various states 
would close 211 National Guard armories and centers.[Footnote 55] These 
closures represent about 10 percent of the over 4,000 existing Army 
reserve components' facilities across the country. While most of the 
Army's projected savings associated with the reserve components' 
recommendations result from reductions in personnel costs by 
eliminating over 4,000 personnel, about 80 percent of these 
eliminations are military personnel. 

Issues Identified with Approved Recommendations: 

Time did not permit us to assess the operational impact of each 
recommendation, particularly recommendations that included multiple 
closure and realignment actions across multiple locations. However, we 
offer a number of broad-based observations about the proposed 
recommendations. Some recommendations may warrant additional attention 
from the BRAC Commission based primarily on issues associated with the 
projected savings from military personnel reductions, uncertainties 
regarding the rebasing of overseas forces and modularity, potential 
impact of expected increase in the use of training ranges, the impact 
on gaining communities, uncertainties regarding the reserve component 
recommendations, the bundling of various recommendations, and concerns 
over the transfer of workload from Red River Army Depot, Texas. 

Military Personnel Reductions: 

Our analysis showed that about $450 million of the Army's projected 
annual recurring savings from its recommended closure and realignment 
actions are based on claimed savings from eliminating military 
personnel. Army officials acknowledged that a large portion of their 
annual recurring savings were derived from military personnel 
eliminations but noted that the Army's financial outlook improved if 
joint cross-service group recommendations involving Army bases are 
considered. Nevertheless, the Army does not plan to reduce its active 
or reserve component end-strength in implementing these 
recommendations. According to Army officials, these personnel are being 
redistributed within the Army. While we believe that the potential 
exists for these personnel to provide a benefit to the Army in their 
new positions, it represents a savings to the Army in the sense of 
potentially avoiding costs that otherwise might be incurred in 
increasing authorized end strength levels. They do not represent dollar 
savings that might be shifted to other appropriations to meet other 
priority needs such as equipment modernization or improving remaining 
facilities, areas typically cited as likely beneficiaries of BRAC 
savings. Further, because DOD envisions BRAC savings in general to be 
used to partially fund up-front investment costs associated with 
implementing BRAC actions, the Army may be forced to find other sources 
of funding as military personnel savings will not likely be available 
for this purpose. The Commission may wish to consider this issue in 
evaluating the BRAC recommendations. 

Uncertainties regarding the Rebasing of Army Overseas Forces to the 
United States and Force Structure Changes due to Modularity: 

Uncertainties over plans to realign thousands of soldiers and their 
families to the United States as a result of the Integrated Global 
Presence and Basing Strategy as well as the Army's modularity efforts 
to create new modular brigades have the potential to change the 
expected costs and savings associated with the Army's BRAC 
recommendations. The Army's BRAC recommendations incorporate about 
15,000 of the 47,000 Army personnel currently expected to return as a 
result of the global basing study.[Footnote 56] The Army also 
incorporated the stationing of five of ten brigades being created under 
the Army's modular restructuring effort.[Footnote 57] Estimated BRAC 
costs and savings are typically calculated based on assumptions for 
specific units or missions that are expected to realign to specific 
installations in specific years. Changes to these assumptions can alter 
the costs and savings associated with the actions being undertaken. 
Existing Army plans for the return of overseas forces and modularity 
were the basis for the assumptions used to calculate estimated costs 
and savings and to determine potential impacts to the environment and 
communities surrounding the affected installations. However, our 
analysis identified several areas of uncertainty that could affect the 
assumptions contained in those recommendations: 

* Army officials told us that DOD has been and is continuing to modify 
its overseas restationing plans, even as the Army BRAC recommendations 
were being finalized. Because of BRAC reporting requirements, the Army 
had to finalize its recommendations before the overseas rebasing plans 
were finalized. Army officials indicated that the major overseas 
restationing actions included in the BRAC recommendations are expected 
to occur as currently envisioned. However, as plans continue to evolve, 
the specific details regarding the rebasing could be adjusted, with 
corresponding adjustments in costs and savings being required. 

* In a May 2005 report produced by the Commission on Review of the 
Overseas Military Facility Structure of the United States,[Footnote 58] 
the Commission recommended slowing down the Army's entire overseas 
restationing process. If DOD heeds this recommendation, the timing of 
some planned restationing actions could be affected with the potential 
risk of not completing BRAC closure or realignment actions within the 6-
year implementation period with a 2011 completion date as established 
by the BRAC legislation. Further, over half of the Army's forces 
returning from overseas are expected to be folded into the new modular 
brigades being formed in the United States. Uncertainties over the 
timing of their return could also impact the costs and savings 
associated with those brigades. 

* In a March 2005 congressional testimony, we reported that the design 
configuration of the Army's modular brigades had not been finalized at 
that time.[Footnote 59] In this regard, the Army is considering adding 
an additional combat battalion to each of its modular brigades and has 
not finalized the design of higher echelon and support units. Any such 
changes to the design that was used in deriving the cost and savings 
estimates and potential impacts to the environment and communities of 
the recommended actions are likely to impact the estimates and may 
alter the potential impacts as well. 

The Commission may wish to ensure that it has the Army's latest plans 
regarding the overseas rebasing and modularity efforts in reviewing the 
Army's recommendations. 

Potential Impact on Training Ranges: 

The Army's BRAC recommendations provide for the stationing of returning 
overseas forces and new modular brigades on existing Army 
installations. Our review of Army documentation shows these 
installations are already facing environmental and encroachment issues 
that constrain their ability to meet unit training requirements. These 
issues raise concerns that currently constrained installations may face 
additional challenges and unexpected costs in meeting the training 
requirements of the additional forces the Army plans to station at 
these installations. As we reported in June 2005, several of the Army's 
training ranges already face challenges resulting from inadequate 
maintenance and modernization and may also require substantial 
investment for modernization to support the training requirements of 
the new brigades.[Footnote 60] Army officials stated they reviewed 
their BRAC recommendations to ensure that there were no insurmountable 
environmental or encroachment obstacles. They also noted that their 
recommendations included costs for training range upgrades. However, we 
have not validated whether these costs will adequately address training 
range limitations. Further, we have concerns as to whether the Army 
will need to acquire additional training range land at existing bases 
that are already experiencing range limitations--a potential cost not 
identified in the current BRAC recommendations. 

Concerns over the ability of existing training ranges to meet training 
requirements are exacerbated by uncertainties over the final number and 
composition of the modular brigades as well as the potential for 
additional forces returning from overseas. Because of existing 
constraints on training ranges, the Army developed scenarios to examine 
the possibility of stationing operational Army units on other 
installations, including installations belonging to other military 
services and Army installations with considerable acreage such as the 
Yuma Proving Ground in Arizona. The Army deemed none of these scenarios 
feasible for various reasons, such as the configuration of other 
service installations and their associated training ranges did not meet 
Army training requirements. For other scenarios, such as use of the 
Yuma Proving Ground, the lack of adequate infrastructure and the 
associated high military construction costs that would be required 
essentially made them infeasible. However, Army officials told us that 
should the Army decide to create an additional five modular brigades or 
bring additional forces back from overseas, it may become necessary to 
station these units at installations such as the Yuma Proving Ground, 
which has large tracts of land, because existing Army installations 
might not be able to support these additional units. The Commission may 
wish to review the Army's plan for addressing training range issues and 
the potential need to acquire additional land to mitigate likely 
challenges the Army faces in the probable increased use of its training 
ranges. 

Impact on Gaining Communities: 

Several of the Army's recommendations involve relocating significant 
numbers of forces and their families to various installations, which 
raises concerns about the ability of local communities to adapt to 
these changes and absorb these personnel increases. For example, Fort 
Bliss, Texas is expected to receive a net gain of over 11,000 military 
and civilian personnel. The full impact of such increases on 
surrounding communities, particularly on schools, housing, and other 
community infrastructure, is unclear at this time. According to Army 
officials, its analysis for the selection criterion regarding community 
impact (criterion seven) provided an overall assessment of the ability 
of local communities impacted by a potential BRAC action to handle 
additional personnel and their families, including the identification 
of potential obstacles that could prevent a recommendation from being 
implemented. For example, in assessing the impact of the return of 
forces from overseas, the Army's review of community infrastructure for 
Fort Bliss and Fort Riley indicated the importance of working with 
these communities to assess and implement housing and schooling 
requirements. However, the Army concluded that these issues did not 
represent impediments to implementing recommendations involving these 
bases. 

Addressing the challenges that these communities face may require 
significant investments, particularly with regard to available housing 
and schools, which would increase pressures for federal assistance from 
various agencies to help mitigate these needs. While such costs might 
be borne outside the defense budget to some extent, they would 
nevertheless represent additional costs to the federal government. 
These potential costs, although not required to be captured in DOD's 
cost and savings analyses for the various recommended actions, could be 
substantial, given the number of Army installations with expected 
personnel gains. Army officials stated that they expect to resolve 
these issues during implementation and that by staggering the movement 
of units being moved to these installations, they believe they will be 
able to reduce adverse impacts and enable communities to better prepare 
for their arrival. Nevertheless, some communities may lack the 
infrastructure to easily absorb these forces. This could impact the 
timing of the movement of forces to these communities, which in turn 
could alter current BRAC cost and savings estimates from a 
governmentwide perspective. The Commission may want to review the 
Army's plans for addressing these issues. 

Uncertainties regarding State Involvement in the Reserve Components' 
Recommendations: 

We identified a number of uncertainties associated with the Army's 
reserve components' recommendations. Most of these recommendations, as 
detailed in the Army's 2005 BRAC report, are contingent upon certain 
actions that have either yet to take place or be decided. For example, 
the Army expects to build 125 Armed Forces Reserve Centers, which are 
currently expected to be able to accommodate National Guard units as 
well as Army Reserve units and some reserve units from the other 
military services. However, the decision to relocate these National 
Guard units lies with state authorities. While the states with Guard 
units that are affected by BRAC recommendations have agreed, on a 
voluntary basis, to be included in the process, they can opt out at any 
time, thereby creating uncertainties over future state actions and 
their impact on the precision of current cost and savings estimates for 
these recommendations. Should state authorities decline to relocate 
some or all of these units, the costs and savings associated with these 
armed forces reserve centers could change. Some of the reserve 
components' recommendations have other contingencies as well. For 
example, the recommendation for the Texas reserve components calls, in 
part, for an Armed Forces Reserve Center to be located in Amarillo, 
Texas, if the Army is able to acquire land suitable for the 
construction of facilities there. Many others are like this as well. 
Should the land not be available, these recommendations will need to be 
adjusted as well as the related costs and savings estimates. While the 
Army's reserve components' recommendations as a whole are projected to 
generate more than $1.5 billion in net savings over a 20-year period if 
implemented, the uncertainties regarding some of the actions these 
recommendations are relying on could result in increases or decreases 
to this estimate. The Commission may wish to seek clarifications as to 
the status of these state-based actions and the potential consequences 
if some of those actions are not executed as currently planned. 

Bundling of Various Recommendations Lessens Visibility of Costs: 

Most of the Army's recommendations involve the bundling of multiple 
closure and realignment actions under one recommendation, which reduces 
the visibility of the estimated costs and savings as well as the 
payback periods of the individual actions that are embedded within the 
recommendation. While the the Army only produced six recommendations 
for the realignment of its active component installations, most of 
these recommendations have several components to them. For example, one 
Army recommendation involves the realignment of the Armor Center and 
School from Fort Knox, Kentucky, to Fort Benning, Georgia; 
the activation of a new modular brigade at Fort Knox; the relocation of 
various combat service support and other units from Europe and Korea to 
the United States; and the relocation of a reserve training center from 
Fort McCoy, Wisconsin, to Fort Knox. Similarly, the Army packaged all 
of its proposed reserve components' realignments and closures within a 
state into a single recommendation for that state. As a result, there 
may be components within a recommendation that have relatively high 
costs or long pay-back periods (or never produce savings) even though 
the recommendation taken as a whole appears to have relatively higher 
savings or a shorter payback period. The Commission may therefore wish 
to request and examine information on the costs and savings associated 
with these individual actions. The following examples highlight these 
potential issues: 

* The Army's maneuver training recommendation would realign Fort Knox 
by incorporating several elements of scenarios the Army and the 
Education and Training Joint Cross-Service Group developed over time. 
The DOD-approved recommendation includes the stationing of a new 
modular brigade at Fort Knox. However, the Army's original scenario for 
realigning Fort Knox, which did not include stationing the modular 
brigade or realigning the Armor Center and School, would have generated 
a 20-year net savings of almost $225 million. The Education and 
Training Joint Cross-Service Group's related scenario involving the 
relocation of the Armor Center and School from Fort Knox to Fort 
Benning would have generated a 20-year net savings of over $1.3 
billion. The Army's approved recommendation combined most of the 
elements of these two scenarios but generated 20-year savings of about 
$950 million, or about $500 million less than one might have expected. 
The difference may be largely attributed to the inclusion of the new 
modular brigade in the Army's final recommendation. 

* The Army's reserve components' transformation recommendation in 
Arizona is expected to have a payback period of 5 years and generate a 
net savings of almost $52 million over a 20-year period. However, one 
action contained within this recommendation involves the creation of an 
Armed Forces Reserve Center at the Buckeye Training Site, Arizona. A 
previous scenario, which focused solely on this action, indicated that 
the Army would incur a net cost of almost $9 million over the 20-year 
period and that it would take more than 100 years to produce savings. 
By bundling this action with others, the net costs of this action are 
obscured by the net savings of the recommendation's other actions. 

Red River Army Depot, Texas: 

We are raising several issues with the recommended closure of the Red 
River depot and the transfer of its functions to other locations that 
may warrant further review by the Commission. The issues relate to the 
transfer of the Red River combat vehicle workload to the Anniston Army 
Depot, Alabama; the transfer of certain munitions to the McAlester Army 
Ammunition Plant, Oklahoma; and the replication of Red River's 
capability to remove and replace rubber pads for vehicle track and road 
wheels. 

Potential Transformation Opportunity for Depot Maintenance: 

As discussed in appendix VIII, the Industrial Joint Cross-Service 
Group, when developing its maintenance proposals, completed its depot 
workloading analysis on the basis of one and a half shifts per workday 
(60 hour workweek) rather than the one shift per day (40 hour workweek) 
under the current system, thus increasing available capacity and 
allowing it to consider depot closures. Industrial group officials told 
us that use of more than one shift, which is a common private 
industrial better business practice, would enhance transformational 
opportunities in that it would provide for more efficient use of 
facilities and equipment. Industrial group officials stated that the 
expanded shift concept, although transformational, was only a "sizing 
or planning tool" to examine ways to increase depot capacity and that 
it would be left up to each depot to decide whether or not to employ 
the expanded shift concept. In other words, it was a way to see if a 
depot could accommodate the incoming transfer of additional workload. 
We were also told that no policy changes were envisioned to actually 
implement the expanded shift concept. Available information indicates 
that the closure recommendation may not be implemented based on the 
concept of a one and a half shift operation at the Anniston Army Depot, 
which is to receive the combat vehicle workload from Red River. In our 
visit to Anniston Army Depot, officials told us that, with additional 
construction to increase capacity as provided for in the supporting 
documentation for the recommendation, they would be able to accommodate 
this additional workload without much difficulty and without working 
under the expanded shift concept. Industrial group officials 
acknowledged that, while some one and a half shift operations may be 
implemented at other activities, only a one shift operation was 
envisioned at Anniston, given the uncertainty associated with future 
requirements and the need to minimize risk by providing for additional 
capacity if a contingency arises. As such, it appears that there is 
essentially no substantive transformational changes occurring with the 
closure of the Red River Army Depot. 

Uncertainties on Munitions Storage: 

The BRAC recommendation to close the Red River Depot also dictates the 
transfer of its munitions storage mission to another Army depot--
McAlester Army Ammunition Plant, Oklahoma. However, officials at Red 
River told us they were concerned about whether storage capacity at 
McAlester was sufficient to handle all of Red River's munitions. 
Specifically, Red River officials told us during a recent visit that 
available excess storage capacity at McAlester has decreased since BRAC 
data were gathered, thus raising concerns whether all of Red River's 
munitions can be stored there. Further, Red River officials asserted 
that McAlester did not have sufficient storage capacity for special 
types of munitions without constructing new storage facilities. 
According to Red River officials, certain munitions (category I and II) 
require different storage capacity and that McAlester currently does 
not have enough storage capacity for Red River's entire category I 
munitions. However our analysis of the closure recommendation 
supporting documentation does not include any provision for military 
construction funds. Industrial group officials told us, however, that 
it expects that the McAlester plant will demilitarize much of its 
ammunition and thus free up space for the munitions stored at Red 
River. However, given that some diversion of demilitarization funds for 
other purposes has occurred in recent years, it raises questions as to 
the extent of the demilitarization that will occur. Nonetheless, in 
their opinion, this potential issue is not of concern to them. Time did 
not permit us to fully resolve the conflicting information regarding 
the extent to which the munitions may be transferred and McAlester's 
ability to sufficiently accommodate the storage of any transferred 
munitions. 

Transfer of Rubber Production Capabilities: 

Red River officials also raised concerns about the complexities 
associated with replicating its rubber production capability, which 
consists of removing and replacing rubber pads for vehicle track and 
road wheels, at Anniston Army Depot, Alabama, and that it is currently 
the only source for road wheels for the Abrams M1 tank. Specifically, 
Red River officials told us this capability is not an easy process to 
reproduce, including obtaining the required certification associated 
with the rubber production capability and that the processes must be 
qualified through rigorous testing. The complexities with replicating 
the rubber production capability was also echoed by officials at 
Anniston Army Depot, Alabama--the installation which is expected to 
absorb most of Red River's combat vehicle workload. Officials at 
Anniston told us they expect a long certification process in order to 
perform the required rubber repair process and that this represents the 
most serious challenge in the workload transfer of Red River's work. As 
to the Abrams Ml tanks road wheels, Red River officials told us that if 
the capability to produce road wheels is interrupted, the ability to 
sustain the warfighter is diminished and overall readiness could be 
degraded. To mitigate this risk, officials at Red River told us that it 
is imperative that the Army construct a new rubber production facility 
at Anniston, establish its processes and qualify its product before 
ceasing rubber production at Red River. Industrial group officials told 
us that, should a problem arise in this area, that commercial sources 
are available to purchase rather than repair these parts. We did not 
independently verify their assertion. 

The Commission may want to review the extent to which these concerns 
associated with Red River are valid and whether they were adequately 
considered by DOD. 

[End of section]

Appendix IV: The Department of the Navy Selection Process and 
Recommendations: 

The Navy followed the common analytical framework established by the 
Office of the Secretary of Defense (OSD) for reviewing its functions 
and facilities. The Navy's process produced 21 base closure and 
realignment recommendations, which cover 63 active and reserve 
installations. The Navy projects that its recommendations would realize 
about $7.7 billion in net present value savings over a 20-year period. 
Payback periods--the time required for savings to offset closure costs-
-range from immediate to 15 years and average 3.5 years. At the same 
time, there are limitations associated with the projected savings 
related to the lack of planned reductions in military personnel end-
strength associated with the savings. Some of the Navy's 
recommendations may warrant additional attention from the BRAC 
Commission based on projected force structure changes, decisions to 
realign versus close some bases, and extended payback periods. The 
Naval Audit Service, which performed audits of the data, concluded that 
the data were sufficiently reliable for use during the BRAC process. 

Organization and Focus: 

The Navy established an organization to conduct the closure and 
realignment analysis similar to the one it used in the 1995 round. The 
Secretary of the Navy established a group of senior military officers 
and civilian executives, the Infrastructure Evaluation Group (IEG), 
chaired by the Assistant Secretary of the Navy (Installations and 
Environment) to conduct the process, and a related team, the 
Infrastructure Analysis Team, to support the IEG. The Secretary 
subsequently established a second senior-level group, the Department of 
the Navy Analysis Group, chaired by the Special Assistant to the 
Secretary of the Navy for BRAC, that was subordinate to the IEG, and he 
directed it to conduct the Navy's analysis for Navy-unique 
functions.[Footnote 61] Another associated group, the Functional 
Advisory Board, consisted of the Navy and Marine Corps principal 
members of the seven joint cross-service groups and was responsible for 
ensuring that the Navy leadership was informed of matters relevant to 
those groups and for articulating the Navy's position on common 
business-oriented support functions for Navy leaders. 

The Navy established numerous goals for BRAC, organized around such 
considerations as (1) facilitating recruitment and training, (2) 
providing quality of life, (3) matching force structure to national 
defense strategy, (4) adequately equipping the force, (5) ensuring 
access to an optimally integrated logistical and industrial 
infrastructure, and (6) maintaining secure and optimally located 
installations for mission accomplishment (including homeland defense). 
With these and other considerations in mind, the Navy established 
numerous objectives corresponding to DOD's BRAC principles, examples 
include: 

* Optimize access to critical maritime training facilities. 

* Accommodate the 20-year force structure plan. 

* Facilitate active/reserve integration and synchronization. 

* Leverage opportunities for joint basing and training. 

* Enable further installation management regional alignment. 

* Optimize regional management structure for recruiting districts and 
reserve readiness command. 

* Minimize use of long-term leased administrative space. 

* Provide flexible research, development, test, and evaluation 
infrastructure to adapt to Navy transformational mission changes and 
joint operations. 

* Consolidate aircraft basing to minimize sites while maintaining 
ability to meet operational requirements. 

* Rely on private-sector support services where cost-effective and 
feasible. 

* Retain sufficient organic capability to effectively support maritime-
unique operation concepts. 

* Align Navy infrastructure to efficiently and effectively support 
Fleet Response Plan and Sea-basing concepts. 

* Realign assets to maximize use of capacity in fleet concentration 
areas while maintaining fleet dispersal and viable antiterrorism/force 
protection capability. 

Framework for Analysis: 

In executing its BRAC process, the Navy sought to eliminate excess 
capacity and reconfigure its current infrastructure so that operational 
capacity maximized warfighting capability and efficiency. The IEG 
approved four major areas for analyses: operations, education and 
training, headquarters and support activities, and other activities. 
These major areas were then further divided into functions to ensure 
that installations performing comparable functions were compared with 
one another and to allow identification of total capacity and military 
value for an entire category of installations. 

The Navy's BRAC process included a review of 889 reporting activities-
-765 Navy and 124 Marine Corps--of which 673 were active component and 
216 reserve component activities (reserve centers, reserve forces 
headquarters, reserve recruiting areas, and reserve personnel centers). 
As with previous BRAC rounds, capacity and military value analysis 
provided the starting point for the Navy's BRAC process. The Naval 
Audit Service served an important role in ensuring the accuracy of data 
used in these analyses through extensive audits of data gathered at 
various locations. 

Capacity Analysis: 

For its capacity analysis, the Navy universe was defined at the 
activity or function level, and a capacity data call was distributed to 
the 889 reporting activities. Capacity analysis for each activity 
consisted of comparing the current Department of the Navy base 
structure to the future force structure requirements to determine 
whether excess base structure capacity existed within the Department of 
the Navy. Current force requirements were based on the existing force 
structure, and future force requirements were derived from the 20-year 
force structure plan. 

All Navy and Marine Corps bases were placed into one of four categories 
for capacity analysis: operations, headquarters and support activities, 
education and training, and other activities. Each category used a 
different metric to analyze capacity. Almost all of the Navy's bases 
were contained in the operations function category. In evaluating air 
operations activities the Navy used hangar modules,[Footnote 62] while 
in evaluating surface/subsurface operations activities it used a 
cruiser-equivalent concept,[Footnote 63] the same measures that were 
used in BRAC 1995.[Footnote 64] In evaluating ground operations 
activities, the Navy used a battalion-equivalent concept that 
considered the amount of administrative space, covered storage space, 
and maintenance space required to support a generic Marine Corps 
battalion. In evaluating munitions storage and distribution, the Navy 
used throughput (loading and unloading) and short-term storage 
functions to conduct its analysis. The Navy identified excess capacity 
in all four categories, as shown in table 11. 

Table 11: Excess Capacity Identified by the Navy, by Function: 

Function: Aviation; 
Percentage of excess capacity: 19%. 

Function: Surface/subsurface; 
Percentage of excess capacity: 25%. 

Function: Ground: 
* Administrative; 
Percentage of excess capacity: 0%; 

Function: Ground: 
* Storage; 
Percentage of excess capacity: 12%; 

Function: Ground: 
* Maintenance; 
Percentage of excess capacity: 11%. 

Function: Munitions storage and distribution (naval weapons stations); 
Percentage of excess capacity: 24%. 

Source: Department of the Navy. 

[End of table]

In completing its capacity analysis, the Navy assumed that it would be 
necessary to home base all aircraft and ships at the same time. The 
Navy did not include additional infrastructure requirements to 
accommodate surge capability. According to Navy BRAC officials, the 
force structure--number of ships and aircraft--is finite in number, and 
additional ships or aircraft could not be quickly produced in the event 
of a contingency. The officials stated that their analysis also ensured 
that sufficient flexibility was retained to handle surge represented by 
operational tempo changes or unanticipated operational requirements. 
For example, for surface/subsurface operations, the Navy concluded that 
there was sufficient berthing space available in nonoperational bases 
(shipyards and weapon stations) to meet surge or other unanticipated 
operational requirements. 

Navy officials projected that their closure recommendations, if 
approved, would reduce excess capacity in aviation operations from 19 
percent to 16 percent, in surface/subsurface operations from 25 percent 
to 17 percent, and in munitions storage and distribution[Footnote 65] 
operations from 24 percent to 16 percent, but they would not reduce 
excess ground operations capacity. The Navy did not recommend closing 
any ground operations facilities, citing cost considerations and noting 
that planned force structure changes would further increase its 
requirements. 

Military Value Analysis: 

In completing its military value analysis, the Navy targeted military 
value questions to specific activities in order to rank installations 
in the four operational subgroups from highest to lowest in military 
value. Each of the four operational subgroups had overarching concepts 
by which military value scoring plans were then developed to measure 
and rank each installation. Military values were assigned to 35 Navy 
and Marine Corps installations under air operations, 29 
surface/subsurface installations, and 11 ground operations 
installations. Table 12 shows how the Navy weighted military value 
criteria in its analyses of operational functions. 

Table 12: Navy Military Value Criteria Weights: 

Figures in percentages. 

Military value criteria: 1. The current and future mission capabilities 
and the impact on operational readiness of the total force of the 
Department of Defense, including the impact on joint warfighting, 
training, and readiness; 
50%. 

Military value criteria: 2. The availability and condition of land, 
facilities, and associated airspace (including training areas suitable 
for maneuver by ground, naval, or air forces throughout a 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; 
20%. 

Military value criteria: 3. The ability to accommodate contingency, 
mobilization, surge, and future total force requirements at both 
existing and potential receiving locations to support operations and 
training; 
15%. 

Military value criteria: 4. The cost of operations and the manpower 
implications; 
15%. 

Total: 100%. 

Source: DOD and Department of the Navy. 

Note: The system of weights provided a basis for assigning relative 
values to data collected and tabulated across each military value 
dimension. 

[End of table]

Key factors considered in evaluating the military value of aviation 
operations activities included size and versatility of the facilities, 
proximity to training opportunities, and the strategic location of 
airfields. In considering surface/subsurface activities, key factors 
were the size and versatility of ship berthing, maintenance and support 
capabilities, and proximity to naval shipyards. Additional value was 
given for strategic nuclear submarine homeport capability and Nimitz-
class nuclear powered berthing capability. Also considered was the 
proximity to training facilities, ranges, and operations areas as well 
as strategic location. Likewise, in considering ground operations 
activities, key factors were facilities and services, operational staff 
buildings, ordnance storage depots, and organic maintenance shops. 
Additional value was given for capability to receive and stage onward 
movement and integration of forces. Also considered was proximity to 
ranges, maneuver areas and training areas as well as proximity to 
aerial and seaports of debarkation. Key factors in the munitions 
storage and distribution operations activities were storage capability, 
throughput capability, strategic factors, environment and encroachment, 
and personnel support. Figure 10 illustrates how the Navy linked its 
analysis to the military value criteria for the naval aviation 
function. 

Figure 10: Selected Attributes, Metrics, and Data Questions Used to 
Assess Military Value of Naval Aviation Operations: 

[See PDF for image] 

[A] The BRAC military value criteria are the first four BRAC selection 
criteria. 

[B] Military value attributes are characteristics of each criterion. 
The Navy used a total of five military value attributes. 

[C] Military value metrics are measures for the attributes. The Navy 
used a total of 31 military value metrics. 

[D] The Navy used a total of 73 data call questions. 

[End of figure] 

The same process was used to analyze military value with the other 
operational and functional areas. 

Naval Audit Service's Role in the Process: 

The Naval Audit Service played an important role in ensuring that the 
data used in the Navy's analyses were certified. Through extensive 
audits of the capacity, military value, and scenario data collected 
from field activities, the audit service notified the Navy of any data 
discrepancies for the purpose of follow-on corrective action.[Footnote 
66] While the process of validating data was quite lengthy and 
challenging, the Naval Audit Service deemed the Navy data was 
sufficiently reliable for use in the BRAC process. 

Identification and Assessment of Alternative Scenarios and Selection of 
Recommendations: 

The Navy used results from the capacity and military value analyses as 
the inputs to its optimization model to help identify initial scenarios 
for realignment and closure.[Footnote 67] In some circumstances, such 
as closure of naval reserve centers, military judgment and 
transformation provided the basis for scenarios and later decisions. 
For example, Navy officials said it was necessary to retain naval 
reserve centers for naval air reservists near major airline hubs and 
activities in order to retain the demographic profile necessary to 
recruit and retain personnel for these units. The Navy identified 187 
scenarios for consideration; 82 involved Navy and Marine Corps reserve 
centers. The scenarios were then further assessed through more detailed 
scenario analyses, cost and savings considerations, risk assessments, 
and the Navy's IEG deliberations, which resulted in 53 candidate 
recommendations being forwarded to DOD's IEC. After some consolidation 
and bundling, DOD approved 21 Department of the Navy recommendations 
and forwarded them to the BRAC Commission. 

The Navy eliminated scenarios for strategic reasons, to maintain 
operational flexibility, and for cost considerations. For example, 
various scenarios proposing to close Submarine Base San Diego, 
California, were dropped because a closure would have eliminated the 
sole capability for berthing attack submarines on the West Coast. 
Likewise, scenarios proposing to close Naval Station Everett, 
Washington, were dropped because of the strategic importance of this 
seaport. Various proposals to close active naval air stations were 
dropped because of operational concerns. For example, the Navy analyzed 
the potential to close Marine Corps Air Station Beaufort, South 
Carolina, and relocate its squadrons to Marine Corps Air Station Cherry 
Point, North Carolina. However, the Navy leadership concluded that 
Marine Corps Air Station Beaufort should be retained for future 
tactical aviation basing flexibility, especially in light of concerns 
about the continued viability of basing aviation units at Naval Air 
Station Oceana, Virginia. Due to increasing environmental and 
encroachment issues surrounding Naval Air Station Oceana, the Navy also 
analyzed various scenarios to close it. However, the analyses indicated 
a long payback period for achieving return on investment, high one-time 
costs, and operational issues at receiving sites. Therefore, the Navy 
determined that the closure of Naval Air Station Oceana was not 
feasible. Another complicating factor for basing of East Coast tactical 
aircraft is the Navy's attempt to purchase approximately 33,000 acres 
in eastern North Carolina to build a new outlying landing field to 
provide simulated aircraft carrier landings for aircraft stationed at 
Naval Air Station Oceana and Marine Corps Air Station Cherry Point. The 
purchase is currently being challenged in federal court over 
environmental concerns. 

The Navy also did not pursue some scenarios because of cost 
considerations and extended payback periods. For example, Navy data 
showed a one-time cost of $838 million to close Construction Battalion 
Center Gulfport, Mississippi, and relocate it to Camp Lejeune, North 
Carolina, and a one-time cost of $643 million to close Marine Corps 
Recruit Depot San Diego, California, and relocate all recruit training 
to Parris Island, South Carolina. The Navy leadership determined that 
these costs did not justify closing either the Construction Battalion 
Center Gulfport or the Marine Corps Recruit Depot San Diego. 

The Navy also considered alternatives to homeport an additional carrier 
strike group forward in the Pacific theater through the BRAC process to 
accommodate Integrated Global Presence and Basing Strategy decisions. 
The Navy analyzed moving a carrier to Pearl Harbor, Hawaii, and Guam, 
and found that other than cost, there was no clear BRAC preference for 
either the losing or the gaining base.[Footnote 68] The Navy leadership 
postponed any decision until the ongoing Quadrennial Defense Review is 
completed. 

The Navy worked closely with the joint cross-service groups as they 
developed recommendations that affected Navy installations. In some 
cases, a joint cross-service group recommendation or series of 
recommendations relocated a majority of the functions, workload, 
equipment, or personnel from a Department of the Navy installation, 
thereby enabling closure of the entire installation. Where the DAG 
determined that the aggregate of joint cross-service group actions were 
of such magnitude that it affected the "critical mass" of the 
installation, e.g., impact on the major mission, a substantial number 
of personnel, and/or a substantial amount of acreage, a Navy closure 
scenario was developed. The closure of Portsmouth Naval Shipyard, Maine 
is an example of such a closure. The ISG and IEC approved an industrial 
joint cross-service group recommendation to relocate the ship overhaul 
and repair function at Portsmouth Naval Shipyard to Norfolk Naval 
Shipyard, Puget Sound Naval Shipyard, and Pearl Harbor Naval Shipyard, 
and to relocate the Submarine Maintenance Engineering, Planning and 
Procurement Activity at Portsmouth Naval Shipyard to the Norfolk Naval 
Shipyard. This recommendation eliminated Portsmouth Naval Shipyard's 
primary mission and moved or eliminated approximately 90 percent of its 
workforce. After conducting criteria 5-8 analyses, the Navy recommended 
closing Portsmouth Naval Shipyard in its entirety. 

Recommendations Approved by DOD: 

The Navy projects that its 21 recommendations will produce about $754 
million in net annual recurring savings and, after savings have offset 
implementation costs, a 20-year net present value savings of $7.7 
billion. Table 13 provides a summary of the financial aspects of the 
Navy's recommendations. 

Table 13: Financial Aspects of the Navy's Recommendations: 

Fiscal year 2005 constant dollars in millions. 

Recommended actions: Close Submarine Base New London, CT; 
DOD report page: DON-10; 
One-time (costs): ($679.6); 
Net implementation (costs) or savings[A]: ($345.4); 
Net annual recurring savings: $192.8; 
Payback period: 3 years; 
20-year net present value[B]: $1,576.4. 

Recommended actions: Close Naval Shipyard Portsmouth, Kittery, ME; 
DOD report page: DON-23; 
One-time (costs): ($448.4); 
Net implementation (costs) or savings[A]: $21.4; 
Net annual recurring savings: $128.6; 
Payback period: 4 years; 
20-year net present value[B]: $1,262.4. 

Recommended actions: Close Naval Air Station Atlanta, GA; 
DOD report page: DON-13; 
One-time (costs): ($43.0); 
Net implementation (costs) or savings[A]: $289.9; 
Net annual recurring savings: $66.1; 
Payback period: immediate; 
20-year net present value[B]: $910.9. 

Recommended actions: Close and realign Naval Station Ingleside, TX and 
Naval Air Station Corpus Christi, TX respectively; 
DOD report page: DON-26; 
One-time (costs): ($178.4); 
Net implementation (costs) or savings[A]: $100.0; 
Net annual recurring savings: $75.6; 
Payback period: 2 years; 
20-year net present value[B]: $822.2. 

Recommended actions: Close and realign Naval Air Station Willow Grove, 
PA and Cambria Regional Airport, Johnstown, PA respectively; 
DOD report page: DON-21; 
One-time (costs): ($126.3); 
Net implementation (costs) or savings[A]: $134.7; 
Net annual recurring savings: $60.6; 
Payback period: 2 years; 
20-year net present value[B]: $710.5. 

Recommended actions: Close Naval Station Pascagoula, MS; 
DOD report page: DON-20; 
One-time (costs): ($17.9); 
Net implementation (costs) or savings[A]: $220.0; 
Net annual recurring savings: $47.4; 
Payback period: immediate; 
20-year net present value[B]: $665.7. 

Recommended actions: Close Naval Support Activity New Orleans, LA; 
DOD report page: DON-15; 
One-time (costs): ($164.6); 
Net implementation (costs) or savings[A]: ($86.1); 
Net annual recurring savings: $36.5; 
Payback period: 3 years; 
20-year net present value[B]: $276.4. 

Recommended actions: Realign Naval Air Station Brunswick, ME; 
DOD report page: DON-18; 
One-time (costs): ($147.2); 
Net implementation (costs) or savings[A]: ($112.6); 
Net annual recurring savings: $34.9; 
Payback period: 4 years; 
20-year net present value[B]: $238.8. 

Recommended actions: Close Navy Reserve Centers; 
DOD report page: DON-37; 
One-time (costs): ($3.2); 
Net implementation (costs) or savings[A]: $87.1; 
Net annual recurring savings: $16.1; 
Payback period: immediate; 
20-year net present value[B]: $236.6. 

Recommended actions: Realign Marine Corps Logistics Base Barstow, CA; 
DOD report page: DON-6; 
One-time (costs): ($26.0); 
Net implementation (costs) or savings[A]: $56.5; 
Net annual recurring savings: $18.4; 
Payback period: immediate; 
20-year net present value[B]: $230.6. 

Recommended actions: Close Navy Recruiting Districts; 
Indianapolis, IN; Omaha, NE; Buffalo, NY; Montgomery, AL; Kansas City, 
MO; 
DOD report page: DON-34; 
One-time (costs): ($2.4); 
Net implementation (costs) or savings[A]: $78.3; 
Net annual recurring savings: $14.5; 
Payback period: immediate; 
20-year net present value[B]: $214.5. 

Recommended actions: Close Naval Weapons Station, Seal Beach, Concord, 
CA; 
DOD report page: DON-9; 
One-time (costs): ($14.0); 
Net implementation (costs) or savings[A]: $43.2; 
Net annual recurring savings: $16.4; 
Payback period: 1 year; 
20-year net present value[B]: $199.7. 

Recommended actions: Realign Navy Reserve Readiness Commands; 
DOD report page: DON-44; 
One-time (costs): ($2.6); 
Net implementation (costs) or savings[A]: $30.9; 
Net annual recurring savings: $6.5; 
Payback period: immediate; 
20-year net present value[B]: $91.7. 

Recommended actions: Close Naval Facilities Engineering Field 
Division/Activity; 
DOD report page: DON-28; 
One-time (costs): ($37.9); 
Net implementation (costs) or savings[A]: ($9.1); 
Net annual recurring savings: $9.3; 
Payback period: 4 years; 
20-year net present value[B]: $81.8. 

Recommended actions: Close Navy and Marine Corps Reserve Centers; 
DOD report page: DON-29; 
One-time (costs): ($62.4); 
Net implementation (costs) or savings[A]: $17.0; 
Net annual recurring savings: $9.9; 
Payback period: 7 years (average); 
20-year net present value[B]: $76.8. 

Recommended actions: Close Marine Corps Support Activity Kansas City, 
MO; 
DOD report page: DON-19; 
One-time (costs): ($23.3); 
Net implementation (costs) or savings[A]: ($8.0); 
Net annual recurring savings: $5.8; 
Payback period: 3 years; 
20-year net present value[B]: $49.8. 

Recommended actions: Close Navy Regions; 
DOD report page: DON-35; 
One-time (costs): ($3.2); 
Net implementation (costs) or savings[A]: $8.9; 
Net annual recurring savings: $2.7; 
Payback period: 1 year; 
20-year net present value[B]: $34.6. 

Recommended actions: Close Navy Supply Corps School Athens, GA; 
DOD report page: DON-14; 
One-time (costs): ($23.8); 
Net implementation (costs) or savings[A]: ($13.6); 
Net annual recurring savings: $3.5; 
Payback period: 7 years; 
20-year net present value[B]: $21.8. 

Recommended actions: Realign Officer Training Command, Naval Air 
Station Pensacola, FL; 
DOD report page: DON-12; 
One-time (costs): ($3.6); 
Net implementation (costs) or savings[A]: $1.4; 
Net annual recurring savings: $0.9; 
Payback period: 4 years; 
20-year net present value[B]: $10.0. 

Recommended actions: Realign Naval Station Newport, RI; 
DOD report page: DON-25; 
One-time (costs): ($11.8); 
Net implementation (costs) or savings[A]: ($8.3); 
Net annual recurring savings: $1.0; 
Payback period: 13 years; 
20-year net present value[B]: $2.1. 

Recommended actions: Close Naval Support Activity Corona, CA; 
DOD report page: DON-7; 
One-time (costs): ($80.2); 
Net implementation (costs) or savings[A]: ($65.5); 
Net annual recurring savings: $6.0; 
Payback period: 15 years; 
20-year net present value[B]: $0.4. 

Total; 
One-time (costs): ($2,099.8); 
Net implementation (costs) or savings[A]: $440.7; 
Net annual recurring savings: $753.5; 
Payback period: 3.5 avg; 
20-year net present value[B]: $7,713.7. 

Source: GAO analysis of DOD data. 

[A] This represents net costs or savings within the 6-year 
implementation period required to implement BRAC recommendations. 

[B] DOD used a 2.8 percent discount rate to calculate net present 
value. 

[End of table]

The Navy's recommendations include 16 closures and 5 realignment 
actions, affecting 63 installations. Much of the projected annual 
recurring savings are based on military and civilian personnel 
reductions. The Navy has two recommendations with payback periods 
greater than 10 years--the realignment of Naval Station Newport, Rhode 
Island, and the closure of the Naval Support Activity Corona, 
California. 

Issues Identified with Approved Recommendations: 

Time did not permit us to assess the operational impact of each 
recommendation, particularly individual recommendations that include 
multiple closure and realignment actions at multiple locations outside 
of a single geographic area. Nonetheless, we offer a number of broad-
based observations about the proposed recommendations. These 
recommendations may warrant additional attention from the BRAC 
Commission based on issues associated with projected savings from 
military personnel reductions, force structure changes, decisions to 
realign versus close some bases, extended payback periods, and 
potential impact on the U.S. Coast Guard. 

There remains uncertainty as to what the Navy's future force structure 
will actually look like, particularly with battle force ships. While 
the Navy's force structure plan that accompanies its BRAC report gives 
a range of 341 to 370 ships in the fleet in 2024, the Navy's 30-year 
shipbuilding plan identifies a possible lower limit of 314 ships in 
2024 (including all type surface ships and submarines). Additionally, 
the shipbuilding plan provides a fleet profile in the decade afterward 
(to the year 2035) with as few as 260 to 325 ships. This includes a 
decrease in aircraft carriers from the current 12 to 10 in 2035, as 
projected in the Navy's shipbuilding plan. 

Military Personnel Reductions: 

Our analysis showed that about $386 million, or about 51 percent, of 
the projected $753.5 million in net annual recurring savings are based 
on savings from eliminating almost 4,000 active duty military personnel 
positions. A Navy official indicated that these reductions will help 
the Navy achieve the projected 21,000 active military personnel 
reductions already programmed between fiscal year 2006 and 2011. 
However, the Navy has already reduced the military personnel account to 
reflect the savings associated with the projected 21,000 end-strength 
reduction. While the projected almost 4,000 reductions associated with 
BRAC actions might help the Navy achieve their overall programmed end 
strength reductions, it will not generate any additional dollar savings 
that could be reallocated for other higher priority needs. 

Projected Changes in Navy Force Structure: 

While the recommendations to close Submarine Base New London, 
Connecticut, and Portsmouth Naval Shipyard, Maine, project significant 
savings, both are based on projected decreases in the number of 
submarines in the future force structure. However, as mentioned 
earlier, there is uncertainty over the number of submarines and surface 
ships required for the future force. 

Submarine Base New London: 

The proposed closure of Submarine Base New London is based on reducing 
existing excess capacity in the surface/subsurface category and planned 
reductions in the submarine force. Both the 25 percent excess capacity 
identified in the surface/subsurface infrastructure and the projected 
21 percent reduction in the submarine force led the Navy to analyze 
various proposals to close submarine bases. As previously noted, the 
Navy's BRAC scenario analysis focused on East Coast submarine bases 
because attack submarines are single-sited on the West Coast. The Navy 
considered three alternatives: (1) moving all submarines at Naval 
Station Norfolk, Virginia, to New London, Connecticut; 
(2) moving all submarines at Submarine Base New London and the 
Submarine School New London to Naval Station Norfolk; 
and (3) moving submarines at Submarine Base New London to both Naval 
Station Norfolk and Submarine Base Kings Bay, Georgia, and moving the 
submarine school to Kings Bay or Naval Station Newport, Rhode Island. 
The Navy analysis showed that only the option to relocate submarines 
from New London to Norfolk and Kings Bay achieved a reduction in 
capacity and savings resulting from a base closure. Navy officials 
noted that Submarine Base New London had a lower military value than 
both Norfolk and Kings Bay. As we also discuss in appendix XIV, this 
recommendation has the largest economic impact on any community in 
terms of the number of job losses (8,457 direct jobs and 7,351 indirect 
jobs). These direct and indirect job losses would result in a negative 
change of 9.4 percent in unemployment for the economic area around 
Submarine Base New London. 

The majority of the projected savings would result from the elimination 
of about 80 percent of the civilian personnel positions at New London. 
Officials at New London we met with concurred with the projected number 
of civilian positions that could be eliminated based on coordination 
with both receiving locations--Kings Bay, Georgia, and Norfolk, 
Virginia, and on the number of personnel that would be needed to 
support the missions being relocated. However, a separate issue of 
concern relates to the proposed move of the Navy's submarine school 
from New London to Kings Bay. In our discussions with officials at New 
London, we found while the Navy's BRAC cost and savings analysis 
includes one-time costs to move the specialized equipment associated 
with the submarine school, the Navy analysis does not appear to have 
included an assessment of the time it would take to pack, move, and 
unpack the equipment, and the potential impact on the training pipeline 
and the certification of crews for submarines. In subsequent 
discussions with Navy headquarters officials, we were told that the 
submarine school would be the last activity to move from New London to 
ensure that facilities at Kings Bay are ready to start training. 
Furthermore, they noted that the implementation plan will ensure that 
the Navy will be able to perform crew certification and maintain the 
training pipeline. The BRAC Commission may want to assure itself that 
the Navy has developed a transition plan to satisfy the training and 
certification requirements until the receiving sites are able to 
perform this training, without unduly interrupting the training 
pipeline. 

Portsmouth Naval Shipyard: 

The proposed closure of the Portsmouth Naval Shipyard assumes that the 
remaining three shipyards[Footnote 69] could perform all of the 
projected depot level maintenance workload based on planned reductions 
in the number of attack submarines and the Navy's proposal to 
decommission an aircraft carrier.[Footnote 70] The Navy, with agreement 
from the Industrial Joint Cross-Service group, which initially had 
assessed depot functions, selected the Portsmouth Naval Shipyard for 
closure, despite Pearl Harbor Shipyard's having a slightly lower 
military value score, because it determined that Portsmouth was the 
only closure that would both eliminate excess capacity and satisfy the 
Combatant Commander's and Navy's strategic objective to place ship 
maintenance capabilities close to the fleet. 

The Navy BRAC and Industrial Joint Cross-Service Groups analyzed 
scenarios closing each of the four shipyards, and determined that only 
the potential closure of Portsmouth or Pearl Harbor was feasible due to 
cost and capacity considerations. Initially, based on capacity data and 
the 20-year force structure plan submitted in March 2004, the 
Industrial Joint Cross-Service Group determined that there was 
sufficient excess capacity in the aggregate across the four shipyards 
to close either Pearl Harbor or Portsmouth. However, the group 
determined that there was insufficient excess capacity in certain 
commodities[Footnote 71] in the remaining three shipyards to accept all 
the workload from the closing shipyard. As such, the group initially 
determined that no shipyard should be closed. However, based on changes 
in the DOD's 20-year force structure plan it submitted to Congress in 
March 2005--reductions in the number of submarines and the 
decommissioning of an aircraft carrier--the industrial group's analysis 
indicated that workload for all commodities at Portsmouth or Pearl 
Harbor could be accommodated by the remaining three shipyards. A Naval 
Sea Systems Command analysis of dry dock availability indicates that 
the three remaining Navy shipyards could handle the projected ship 
repair and overhauls in the future. However, the analysis indicates 
that within the next three years there would not be much, if any, room 
for unanticipated ship repairs. According to Navy officials, any 
unanticipated requirements would be addressed by a combination of 
delaying and re-prioritizing scheduled overhaul work, and authorizing 
additional overtime, which they noted is no different than how they 
manage these requirements in the current operating environment. 

In selecting Portsmouth over Pearl Harbor for closure, the Navy noted 
that Pearl Harbor is in a fleet concentration area in the Pacific 
theater and is the homeport for many ships, while Portsmouth is not in 
a fleet concentration area or a homeport for any ships. In addition, 
closing Pearl Harbor would require the ships that are homeported there 
to transit back to the east coast, in some cases, for maintenance, 
which the Navy would essentially view as a deployment and, for quality 
of life reasons, would want to avoid if possible. Another strategic 
objective was to maintain dry docks for aircraft carriers on both 
coasts and in the central Pacific. Pearl Harbor has aircraft carrier 
dry-docking capability, but Portsmouth does not. 

In our meeting with employees at the Portsmouth Naval Shipyard in June 
2005, they raised questions about several issues regarding the cost and 
savings analysis developed to support the proposed action. First, they 
objected to the industrial group and the Navy disallowing about $281 
million in costs ($205 million one-time and $76 million recurring) that 
they believed would be incurred if the shipyard were to close. About 
$52 million of the recurring costs are associated with sustainment of 
facilities and power plant from fiscal year 2008, when the base is 
projected to close, until 2011. While some of these costs are likely 
valid, overall they appear high in relation to the Navy's projected 
savings of about $120 million over the same period from reduced base 
operating support and sustainment of facilities. The majority of the 
one-time costs are associated with closure of the buildings, historical 
preservation of buildings, and write-off of undepreciated assets of the 
working capital fund. While it is questionable whether all of these 
costs should be included, our analysis shows that if they are all 
included, the projected 20-year savings would decrease by $192 million, 
or 15 percent. 

Portsmouth employees were also concerned that the cost and savings 
analysis did not adequately capture the widely recognized efficiencies 
of their shipyard, which, if adopted, could translate into additional 
costs that the Navy would incur by shifting its workload to the 
remaining three Navy shipyards. The employees estimated that they 
perform submarine overhaul and depot maintenance work at about $54 
million per year less than the average of the other three shipyards, an 
efficiency which was not included in the Navy's analysis. Department of 
Navy officials recognized that the Portsmouth Naval shipyard is 
presently more efficient than the Puget Sound and Pearl Harbor 
shipyards, but noted that it is very difficult to quantify the impact 
of this efficiency. Navy officials noted that the scope of work 
performed is not always the same, depending on the condition of each 
submarine, and wages, especially in Pearl Harbor, are higher than in 
Portsmouth. Navy officials told us they were reviewing the efficiency 
analysis developed by the Portsmouth Naval Shipyard; 
however, their analysis was not completed in time to be included in 
this report. The Commission may wish to consider the views of the 
shipyard employees and the results of the Navy's review in their 
analysis of this recommendation. 

Decisions to Realign Rather Than Close Some Bases: 

The Navy initially recommended the closure of Naval Air Station 
Brunswick, Maine, and Marine Corps Logistics Base Barstow, California. 
However, based on direction from the IEC, these closure recommendations 
were changed to realignments. As a result, the 20-year savings 
decreased by almost $2 billion, as shown in table 14. 

Table 14: Comparison of Alternatives to Closing and Realigning Naval 
Air Station Brunswick and Marine Corps Logistics Base Barstow: 

Dollars in millions. 

One-time (costs); 
Brunswick: Closure: ($192.9); 
Brunswick: Realignment: ($147.2); 
Brunswick: Difference: ($45.7); 
Barstow: Closure: ($316.6); 
Barstow: Realignment: ($26.0); 
Barstow: Difference: ($290.6). 

Net implementation (costs) or savings; 
Brunswick: Closure: $73.4; 
Brunswick: Realignment: ($112.6); 
Brunswick: Difference: ($39.2); 
Barstow: Closure: ($248.3); 
Barstow: Realignment: ($56.5); 
Barstow: Difference: ($191.8). 

Net annual; 
recurring savings; 
Brunswick: Closure: $92.7; 
Brunswick: Realignment: $34.9; 
Brunswick: Difference: $57.8; 
Barstow: Closure: $141.9; 
Barstow: Realignment: $18.4; 
Barstow: Difference: $123.5. 

Payback period; 
Brunswick: Closure: 1 year; 
Brunswick: Realignment: 4 years; 
Barstow: Closure: 1 year; 
Barstow: Realignment: immediate. 

20-year net present value savings; 
Brunswick: Closure: $840.7; 
Brunswick: Realignment: $238.8; 
Brunswick: Difference: $601.9; 
Barstow: Closure: $1,600.0; 
Barstow: Realignment: $230.6; 
Barstow: Difference: $1,369.4. 

Source: GAO analysis of Navy data. 

[End of table]

According to Navy BRAC officials, the senior Navy leadership was 
reluctant to give up the Navy's remaining air station in the Northeast 
but found the potential savings significant enough to recommend closure 
of Brunswick. However, the judgment of the IEC changed the closure to a 
realignment to retain access to the strategic airfield in the 
Northeast. As a result, the base will become a naval air facility with 
an operational runway, but all aircraft and associated personnel, 
equipment, and support will be relocated to Naval Air Station 
Jacksonville, Florida, and the Aviation Intermediate Maintenance will 
be consolidated with Fleet Readiness Center Southeast Jacksonville, 
Florida. The Navy is maintaining its cold weather-oriented Survival, 
Evasion, Resistance, and Escape School, a Navy Reserve Center, and 
other small units at Brunswick. Navy officials also stated that 
Brunswick would provide a base from which to carry out potential 
homeland defense missions should those missions not be able to be 
carried out from other military or civilian airfields in the Northeast. 

The Industrial Joint Cross-Service Group had proposed to close the 
depot maintenance functions at Barstow because of its low military 
value and to increase opportunities for joint maintenance at Army 
depots doing similar work. However, the Marine Corps objected to the 
closure because that would eliminate its only West Coast ground vehicle 
depot maintenance presence and would increase repair cycle times for 
the Marine's West Coast equipment by increasing rail transit and 
customer turnaround time by 10 to 30 days. In response to the Marine 
Corps' concerns, the IEC directed the Industrial Joint Cross-Service 
Group to develop several alternative recommendations that would have 
closed Barstow but still realigned its workload to other West Coast 
activities. The Industrial Joint Cross-Service Group estimated that all 
of these options would result in higher net annual recurring and 20-
year net present savings than would the realignment option. The 
Commission may want to assess DOD's rationale for changing the 
recommendation from a closure to realignment in light of the projected 
reductions in savings. 

Extended Payback Periods: 

The Navy has two recommendations for which the payback period is 
greater than 10 years, much longer than typically associated with 
recommendations in the 1995 BRAC round, and the one-time costs are 
significantly greater than the projected 20-year savings by which BRAC 
rounds are typically measured. The Navy's proposal to realign Naval 
Station Newport by relocating the Navy Warfare Development Command to 
Naval Station Norfolk has a 13-year payback period and a projected one-
time cost of about $12 million, primarily to rehabilitate existing 
structures and move 111 personnel. According to Navy officials, this 
recommendation places the Navy Warfare Development Command closer to 
Fleet Forces Command and the Second Fleet Battle Lab it supports. 
Likewise, the Navy recommendation to close Naval Support Activity 
Corona has a payback period of 15 years, one-time cost of about $80 
million, and 20-year savings of about $400,000. Navy data shows that 
the one-time cost is primarily to rehabilitate existing facilities and 
relocate personnel from Corona to Naval Air Station Point Mugu, 
California. Navy officials stated the closure had merit because the 
Corona facility was a single-function facility whose mission could be 
performed at other multifunction bases. 

Potential Impact on the U.S. Coast Guard: 

Several Navy recommendations to close bases could affect the U.S. Coast 
Guard. However, the Navy's cost and savings analysis did not consider 
any costs that could be incurred by the Coast Guard if the bases are 
closed. Navy officials recognized that the Coast Guard would be 
affected by several of its recommendations and considered the impact in 
its deliberations. However, they determined that it was unreasonable to 
include any cost estimates for the Coast Guard because the Navy could 
not assume the final disposition of the facility and how much, if any, 
of the facility the Coast Guard would opt to retain. Coast Guard 
officials stated that the Navy briefed them on their potential 
recommendations several months prior to the public announcement of the 
recommendations. The Coast Guard is in the process of developing 
potential basing alternatives, to include cost impacts, for each 
affected location. However, the Coast Guard had not completed these 
estimates in time for us to include them in our report. 

[End of section]

Appendix V: The Department of the Air Force Selection Process and 
Recommendations: 

The Air Force followed the common analytical framework established by 
the Office of the Secretary of Defense (OSD) for reviewing its 
functions and facilities. The Air Force's process produced 42 
recommendations. Most of the recommendations are devoted to reserve 
component bases, including several realignment actions reallocating 
aviation assets to multiple locations. In comparison with the other 
services, its recommendations contain the smallest number of closures 
(three) of active component bases. It had two major realignments, 
however, that left the bases in a reduced active duty status, and 
another where the base was transferred to the Army, with the Air Force 
retaining a limited presence as a tenant. The Air Force recommendations 
project the greatest savings of any of the services--$14.6 billion in 
20-year net present value savings. Payback periods--the time required 
for savings to offset closure and realignment costs--for active 
component bases range from immediate to 14 years, and average 3 years, 
and for reserve component bases they range from immediate to 18 years, 
and average 6 years. However, our analysis indicates that these 
projected savings in each of their categories could have some 
limitations, primarily due to the lack of personnel end-strength 
reductions associated with claimed savings. In addition, some Air Force 
recommendations may warrant additional attention by the BRAC Commission 
because of uncertainty regarding future mission requirements for 
adversely affected reserve component personnel, and because of lengthy 
payback periods associated with some recommendations having been merged 
with other recommendations that have shorter payback periods, thus 
making the former appear more acceptable. The Air Force Audit Agency, 
which performed audits of the data, concluded that the data were 
sufficiently reliable for use during the BRAC process. 

Organization and Focus: 

The Secretary of the Air Force established a group of senior Air Force 
military and civilian personnel to form an executive deliberative body 
responsible for conducting the Air Force base closure and realignment 
analyses. The Base Closure Executive Group was led by a Deputy 
Assistant Secretary and a General Officer from Plans and Programs, who 
served as co-chairs. This group's working-level staff made up the Base 
Closure Working Group, which provided direct support for data 
collection, validation, and analysis in the development of base closure 
and realignment recommendations.[Footnote 72]

The Air Force 2005 BRAC goals were to transform by maximizing 
warfighting capability of each squadron and realigning infrastructure 
with future defense strategy, maximizing operational capability by 
eliminating excess physical capacity, and to capitalize on 
opportunities for joint activity. To guide the BRAC process, the Air 
Force developed the following principles, to be applied to both active 
and reserve components: 

* Maintain squadrons within operationally efficient proximity to DOD-
controlled airspace, ranges, military operations areas, and low-level 
routes. 

* Optimize the size of Air Force squadrons in terms of aircraft models, 
aircraft assigned, and crew ratios applied. 

* Retain enough domestic capacity to base the Air Force entirely within 
the United States and its territories. 

* Retain aerial refueling bases in optimal proximity to their missions. 

* Better meet the needs of the Air Force by maintaining or placing Air 
Reserve Component (Air National Guard or Air Force Reserve Command) 
units in locations that best meet the demographic and mission 
requirements unique to the Air Reserve Component. 

* Ensure joint basing realignment actions (in comparison with the 
status quo) either increased the military value of a function or 
decreased the cost for the same military value of that function. 

* Ensure that long-range strike bases provide flexible strategic 
response and strategic force protection. 

* Support the Air Expeditionary Forces framework by keeping two 
geographically separate munitions sites. 

* Retain enough surge capacity to support deployments, evacuations, and 
base repairs. 

* Consolidate or co-locate legacy fleets (such as A-10, B-1, B-52, F-
15, and F-16 aircraft). 

* Ensure global mobility by retaining two air mobility bases and one 
additional wide-body-capable base on each coast. 

Several of the above principles were included in an Expeditionary Air 
Force Principles White Paper,[Footnote 73] which outlined principles to 
shape future force development and basing. This document, discussed the 
increased effectiveness and efficiency of consolidating smaller 
squadrons into larger units. The significant reduction in aircraft 
based on the future force structure plan of 2025 will reduce the Air 
Force infrastructure, including that of the Air Reserve and the Air 
National Guard to select the best combination of bases, while 
accommodating use of reserve components for emerging missions, such as 
homeland defense and unmanned aerial systems. 

Framework for Analysis: 

The Air Force BRAC process included a review of 154 installations--70 
active and 84 reserve. As with previous BRAC rounds, capacity and 
military value analyses provided the starting point for analysis. 
However, in this BRAC round the Air Force concentrated its analysis on 
operational aircraft and space missions, since joint cross-service 
groups developed capacity and military value analyses and 
recommendations for various commonly held business-oriented categories, 
such as education and training, headquarters, and technical functions. 
The Air Force Audit Agency performed an important role in ensuring the 
accuracy of data used in these analyses through extensive audits of 
data gathered at various locations. 

Capacity Analysis: 

The Air Force collected information on key capacity areas, such as 
physical capacity (buildings and utilities), environmental issues (air 
emissions and water resources), encroachment (constraints and noise 
safety), airfields, airspace and ranges (operational capacity of 
runways, ramp space, and fuel storage), communications 
(telecommunications), and personnel. The capacity data call was 
designed to provide information to assess bases for current and future 
missions in the following mission areas: (1) airlift; (2) space 
operations; (3) bombers; (4) tankers; (5) command and control and 
intelligence, surveillance and reconnaissance; (6) unmanned aerial 
vehicles; (7) fighter aircraft; and (8) Special Operation Forces and 
Combat, Search, and Rescue. The Air Force also considered surge 
requirements in its capacity analysis. According to Air Force 
officials, surge was defined as the ability to domestically "bed down" 
all aircraft, including those currently stationed overseas, as well as 
the ability to respond to natural disasters, emergencies, and runway 
repairs.[Footnote 74]

Following the collection of the capacity data call, the Air Force 
requested that its eight major commands[Footnote 75] and the Air 
National Guard estimate each installation's capacity to acquire 
additional squadrons, taking into consideration existing conditions, 
facilities, additional construction requirements, and operational and 
environmental infrastructure. 

The capacity analysis incorporated information from the 20-year force 
structure plan to serve as a baseline and to further define 
requirements in the future. Although this analysis indicated the 
ability of bases to bed down additional aircraft, according to Air 
Force officials, it did not provide a specific excess capacity 
percentage by installation or major command. Accordingly, an overall 
capacity analysis report was not made available to us, comparable to 
that provided by the other military departments. However Air Force 
officials said they considered capacity information in their assessment 
of installations. Air Force officials did provide limited capacity 
information in their final BRAC report. Table 15 provides excess 
capacity percentages that were calculated for two areas. 

Table 15: Excess Capacity Identified by the Air Force, by Function: 

Function: Flight line and ramp; 
Percentage of excess capacity: 25%. 

Function: Building and facilities; 
Percentage of excess capacity: 14%. 

Source: Department of the Air Force. 

[End of table]

According to Air Force officials, their recommendations if implemented 
are projected to reduce excess capacity by 37 percent for flight line 
and ramp space and 75 percent in buildings and facilities. 

Military Value Analysis: 

In completing its military value data calls, the Air Force evaluated 
each of its bases in each of the eight mission categories, regardless 
of the base's current use. Military value data analysis was directly 
linked to the four DOD military value selection criteria required by 
the BRAC process and legislation. As shown in table 16, the Air Force 
developed a weighting system for the military value criteria with the 
first two criteria having larger weights, or importance, than the 
remaining two criteria. 

Table 16: Air Force Military Value Criteria Weights: 

Figures in percentages. 

Military value criteria: 1. The current and future mission capabilities 
and the impact on operational readiness of the total force of the 
Department of Defense, including the impact on joint warfighting, 
training, and readiness; 
46%. 

Military value criteria: 2. The availability and condition of land, 
facilities, and associated airspace (including training areas suitable 
for maneuver by ground, naval, or air forces throughout a 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; 
41%. 

Military value criteria: 3. The ability to accommodate contingency, 
mobilization, surge, and future total force requirements at both 
existing and potential receiving locations to support operations and 
training; 
10%. 

Military value criteria: 4. The cost of operations and the manpower 
implications; 
3%. 

Total: 100%. 

Source: DOD and Department of the Air Force. 

[End of table]

The Air Force used various military value attributes (characteristics, 
factors, etc), metrics (measures), and questions related to each of the 
four military value criteria. Key military value attributes included 
operating environment, geographic-location factors, key mission 
infrastructure, operating areas, mobility/surge, growth potential, and 
cost. Other installation-specific attributes included such factors as 
electromagnetic spectrum and bandwidth, munitions storage and handling, 
runway dimensions, ramp area, space launch, proximity to (and quality 
of) airspace and ranges, and geographical factors. 

Figure 11 shows how the attributes, metrics, and military value data 
questions were linked to the military criteria for the fighter aircraft 
mission category. 

Figure 11: Selected Attributes, Metrics, and Data Questions Used to 
Assess Military Value of Fighter Aircraft: 

[See PDF for image] 

[A] The BRAC military value criteria are the first four BRAC selection 
criteria. 

[B] Military value attributes are characteristics of each criterion. 
The Air Force used a total of seven military value attributes. 

[C] Military value metrics are measures for the attributes. The Air 
Force used a total of 23 military value metrics for the fighter mission 
compatibility index. 

[D] The Air Force used a total of 23 out of a total of 154 military 
value data call questions for the Fighter Mission Compatibility Index. 
The Air Force commonly referred to metrics as questions. 

[End of figure] 

The Air Force followed a similar process for all eight mission 
categories. Likewise, each base was evaluated against metrics 
associated with each of the eight mission categories, which resulted in 
multiple military values for each base. Air Force officials stated that 
the resulting military value scores enabled them to determine which 
bases were best to retain and which were less desirable. This enabled 
them to produce mission compatibility indexes for their bases related 
to each of the four military value criteria.[Footnote 76] However, the 
Air Force did not develop one composite score for each base across all 
eight mission areas, which might have allowed for a clearer distinction 
between lower and higher military value rankings. Instead of developing 
one composite score, the Air Force established an overall mission 
compatibility index score within each of the eight mission areas, which 
provided each installation with eight entirely different scores for the 
various mission areas. According to Air Force officials, this approach 
was used to apply military judgment to select the best combination of 
bases to retain. 

Air Force Audit Agency's Role in the Process: 

During both the capacity and the military value data collection and 
analysis processes, the Air Force Audit Agency provided the Air Force 
with real-time evaluations of BRAC 2005 policies, procedural controls, 
systems, and data to ensure accurate data and analyses support for BRAC 
recommendations. One of its primary efforts involved three audits to 
verify the Air Force data call responses submitted during the BRAC 
process. Although the auditors found errors or inadequate source 
documentation, they reported that most discrepancies were subsequently 
corrected. In addition to these nationwide audits, the Air Force Audit 
Agency produced audit reports on other facets of the BRAC process, 
including the Air Force Internal Control Plan, COBRA data, and various 
modeling and analysis tools that were used in development of 
recommendations.[Footnote 77] The final Air Force Audit Agency reports 
on BRAC data concluded that overall the Air Force data were reliable 
for the purpose of developing recommendations. 

Identification and Assessment of Alternate Scenarios and Selection of 
Recommendations: 

The Air Force identified over 100 scenarios, which were later reduced 
to 42 recommendations.[Footnote 78] The Air Force scenario 
teams[Footnote 79] identified potential scenario groups of like weapons 
systems, and then the Base Closure Executive Group selected scenarios 
for analysis. While the Air Force relied on certified data to identify 
proposed closure and realignment recommendations, other factors were 
instrumental in guiding decisions for closures and realignments, 
including changes in unit sizing, a decreased force structure, the 
active and reserve mix and future total force initiatives such as those 
discussed in the Expeditionary Air Force White Paper. Toward the end of 
the BRAC process, the Air Force eliminated and scaled back several 
recommendations because they did not actually result in net savings. In 
addition, the Air Force combined several interrelated recommendations 
(some that provide savings and some that do not) to present a 
consolidated recommendation with savings and a shorter payback period 
than would otherwise appear had some recommendations. 

The military value data were analyzed by a computer-generated 
optimization model called the Air Force cueing tool. This model used 
the military value data and the 20-year force structure plan to create 
a starting point for Base Closure Executive Group deliberations by 
allocating aircraft to the fewest bases while conserving the greatest 
military value. This model also included Air Force imperatives. For 
example, to ensure unimpeded access to polar and equatorial earth 
orbits for U.S. satellites, the Air Force decided that Vandenberg Air 
Force Base, California, and Patrick Air Force Base, Florida, must be 
retained. Likewise, the Air Force retained Andrews Air Force Base, 
Maryland, to provide support to the President of the United States. 
According to Air Force officials, the cueing tool results were the 
starting point for analysis in allocating its inventory of aircraft. 
The model had various limitations, such as its inability to factor the 
active/reserve force mix for specific types of aircraft or the 
different types of aircraft at an installation. Furthermore, it assumes 
that all aircraft are bedded down at bases ranked highest in military 
value, which generally were active bases. To address these limitations, 
the Base Closure Executive Group relied on military judgment in some 
cases to overrule the results of the model to preserve the existing 
active/reserve force mix, a ratio expectation to be maintained through 
2011. 

In reviewing alternatives for BRAC recommendations, the Air Force went 
through various iterations of the BRAC recommendations (called second 
look, third look, and so forth) in order to provide force structure 
alignments that conformed to the Air Force principles and improved 
military capability and efficiency, consistent with sound military 
judgment. Air Force scenario teams analyzed the results of the 
analytical tools, including information to be considered with each 
recommendation--for example, force structure reductions from the future 
year force structure plan, new missions, military construction 
requirements, homeland defense missions, and other areas. Furthermore, 
the scenario teams were responsible for identifying any "showstoppers," 
in terms of capacity or environmental characteristics that would make a 
recommendation difficult to implement. These consisted of running a 
potential recommendation through the COBRA model and developing the 
information for selection criteria 6 (economic impact), 7 (community 
infrastructure), and 8 (environmental impact) to help identify or 
evaluate possible closure and realignment actions. 

The majority of the candidate recommendations had various components 
derived from using the optimization model; however, a few of the 
recommendations did not. For example, a few of the candidate 
recommendations involved realigning aircraft from an active base to an 
Air National Guard station with a lower military value score in order 
to achieve the appropriate mix between active and reserve forces and to 
increase the standard squadron size. Further, in some recommendations 
Air National Guard aircraft were realigned to other Air National Guard 
stations with a lower military value to align common versions of weapon 
system types, and for strategic interests.[Footnote 80]

Four other recommendations were not derived from an optimization model 
because the model primarily focused on the bedding down of aircraft 
rather than specific functional areas, such as repair facilities. These 
recommendations involved logistics support centers, standard air 
munitions packages (munitions storage), and avionics intermediate 
repair and maintenance facilities. Air Force officials told us they had 
requested that the Industrial Joint Cross-Service Group consider the 
above candidate recommendations in its process, but the group declined 
and deferred to the Air Force because it was considering scenarios at a 
joint operational level rather than at the installation level. As a 
result, Air Force officials told us that they applied either a Mission 
Compatibility Index approach to these scenarios in deliberative session 
to assess installations for future missions or they recommended certain 
functions to follow the placement of aircraft in other Air Force 
recommendations. 

Recommendations Approved by DOD: 

The Air Force recommended closing 10 installations (3 active, 3 Air 
Reserve, and 4 Air National Guard bases) and realigning 62 other 
installations.[Footnote 81] In total, the Air Force projected its BRAC 
recommendations to result in 20-year net present value savings of over 
$14 billion--the largest projected savings of any service or Joint 
Cross-Service Group--and net annual recurring savings of $1.2 billion. 
Table 17 shows the financial aspect of the Air Force recommendations. 

Table 17: Financial Aspects of the Air Force's Recommendations: 

Fiscal year 2005 constant dollars in millions. 

Realign Eielson Air Force Base, AK; 
DOD report page: AF-6; 
One-time (costs): ($141.4); 
Net implementation (costs) or savings[A]: $594.0; 
Net annual recurring savings: $229.4; 
Payback period: immediate; 
20-year net present value savings[B]: $2,780.6. 

Close Cannon Air Force Base, NM; 
DOD report page: AF-32; 
One-time (costs): ($90.1); 
Net implementation (costs) or savings[A]: $815.6; 
Net annual recurring savings: 200.5; 
Payback period: immediate; 
20-year net present value savings[B]: $2,706.8. 

Realign Pope Air Force Base, NC[C]; 
DOD report page: AF-35; 
One-time (costs): ($218.1); 
Net implementation (costs) or savings[A]: $652.5; 
Net annual recurring savings: 197.0; 
Payback period: immediate; 
20-year net present value savings[B]: $2,515.4. 

Realign Grand Forks Air Force Base, ND; 
DOD report page: AF-37; 
One-time (costs): ($131.5); 
Net implementation (costs) or savings[A]: $322.5; 
Net annual recurring savings: 173.3; 
Payback period: 1 year; 
20-year net present value savings[B]: $1,982.0. 

Close Ellsworth Air Force Base, SD; 
DOD report page: AF-43; 
One-time (costs): ($299.1); 
Net implementation (costs) or savings[A]: $316.4; 
Net annual recurring savings: 161.3; 
Payback period: 1 year; 
20-year net present value savings[B]: $1,853.3. 

Realign Mountain Home Air Force Base, ID; 
DOD report page: AF-18, 47; 
One-time (costs): ($74.2); 
Net implementation (costs) or savings[A]: $21.2; 
Net annual recurring savings: 37.8; 
Payback period: immediate; 
20-year net present value savings[B]: $389.0. 

Close Otis Air National Guard Base, MA; 
DOD report page: AF-25; 
One-time (costs): ($103.0); 
Net implementation (costs) or savings[A]: $12.2; 
Net annual recurring savings: 33.6; 
Payback period: 3 years; 
20-year net present value savings[B]: $336.1. 

Close Onizuka Air Force Station, CA; 
DOD report page: AF-12; 
One-time (costs): ($123.7); 
Net implementation (costs) or savings[A]: ($45.3); 
Net annual recurring savings: 25.9; 
Payback period: 5 years; 
20-year net present value savings[B]: $211.0. 

Close Niagara Falls Air Reserve Station, NY; 
DOD report page: AF-33; 
One-time (costs): ($65.2); 
Net implementation (costs) or savings[A]: $5.3; 
Net annual recurring savings: 20.1; 
Payback period: 2 years; 
20-year net present value savings[B]: $199.4. 

Realign Robins Air Force Base, GA; 
DOD report page: AF-16; 
One-time (costs): ($6.7); 
Net implementation (costs) or savings[A]: $31.9; 
Net annual recurring savings: 15.0; 
Payback period: immediate; 
20-year net present value savings[B]: $175.1. 

Close W.K. Kellogg Air Guard Station, MI; 
DOD report page: AF-27; 
One-time (costs): ($8.3); 
Net implementation (costs) or savings[A]: $46.7; 
Net annual recurring savings: 12.7; 
Payback period: immediate; 
20-year net present value savings[B]: $166.8. 

Close Kulis Air Guard Station, AK; 
DOD report page: AF-7; 
One-time (costs): ($81.4); 
Net implementation (costs) or savings[A]: ($20.6 ); 
Net annual recurring savings: 17.3; 
Payback period: 4 years; 
20-year net present value savings[B]: $146.7. 

Realign New Castle Air Guard Station, DE; 
DOD report page: AF-15; 
One-time (costs): ($15.5); 
Net implementation (costs) or savings[A]: $29.1; 
Net annual recurring savings: 9.6; 
Payback period: 1 year; 
20-year net present value savings[B]: $120.1. 

Realign Nashville Air Guard Station, TN; 
DOD report page: AF-44; 
One-time (costs): ($25.4); 
Net implementation (costs) or savings[A]: ($16.7); 
Net annual recurring savings: 13.7; 
Payback period: 2 years; 
20-year net present value savings[B]: $120.0. 

Realign Portland Air Guard Station, OR; 
DOD report page: AF-41; 
One-time (costs): ($85.5); 
Net implementation (costs) or savings[A]: ($36.2); 
Net annual recurring savings: 14.0; 
Payback period: 7 years; 
20-year net present value savings[B]: $100.2. 

Realign Martin State Air Guard Station, MD; 
DOD report page: AF-24; 
One-time (costs): ($9.4); 
Net implementation (costs) or savings[A]: $13.7; 
Net annual recurring savings: 8.7; 
Payback period: 1 year; 
20-year net present value savings[B]: $97.1. 

Close Mansfield-Lahm Air Guard Station, OH; 
DOD report page: AF-39; 
One-time (costs): ($33.4); 
Net implementation (costs) or savings[A]: $3.1; 
Net annual recurring savings: 8.7; 
Payback period: 3 years; 
20-year net present value savings[B]: $86.2. 

Realign Hill Air Force Base, UT; 
DOD report page: AF-47; 
One-time (costs): ($28.2); 
Net implementation (costs) or savings[A]: $8.2; 
Net annual recurring savings: 8.1; 
Payback period: 4 years; 
20-year net present value savings[B]: $85.9. 

Realign Andrews Air Force Base, MD; 
DOD report page: AF-23; 
One-time (costs): ($21.7); 
Net implementation (costs) or savings[A]: $12.2; 
Net annual recurring savings: 7.5; 
Payback period: 2 years; 
20-year net present value savings[B]: $83.1. 

Realign Naval Air Station New Orleans Air Reserve Station, LA; 
DOD report page: AF-22; 
One-time (costs): ($50.2); 
Net implementation (costs) or savings[A]: ($32.5); 
Net annual recurring savings: 11.3; 
Payback period: 5 years; 
20-year net present value savings[B]: $80.7. 

Establish Air Force logistics support centers; 
DOD report page: AF-53; 
One-time (costs): ($9.3); 
Net implementation (costs) or savings[A]: $19.2; 
Net annual recurring savings: 6.1; 
Payback period: 1 year; 
20-year net present value savings[B]: $77.0. 

Close General Mitchell Air Reserve Station, WI; 
DOD report page: AF-52; 
One-time (costs): ($38.4); 
Net implementation (costs) or savings[A]: ($14.3 ); 
Net annual recurring savings: 6.5; 
Payback period: 5 years; 
20-year net present value savings[B]: $50.2. 

Realign Lackland Air Force Base, TX; 
DOD report page: AF-46; 
One-time (costs): ($8.1); 
Net implementation (costs) or savings[A]: $4.7; 
Net annual recurring savings: 2.9; 
Payback period: 2 years; 
20-year net present value savings[B]: $32.4. 

Realign Bradley Air Guard Station, CT; 
DOD report page: AF-14; 
One-time (costs): ($3.2); 
Net implementation (costs) or savings[A]: $6.1; 
Net annual recurring savings: 2.0; 
Payback period: 2 years; 
20-year net present value savings[B]: $25.2. 

Realign Reno-Tahoe Air Guard Station, NV; 
DOD report page: AF-31; 
One-time (costs): ($22.9); 
Net implementation (costs) or savings[A]: ($12.2); 
Net annual recurring savings: 3.6; 
Payback period: 9 years; 
20-year net present value savings[B]: $22.7. 

Realign Great Falls Air Guard Station, MT; 
DOD report page: AF-30; 
One-time (costs): ($9.3); 
Net implementation (costs) or savings[A]: $0.7; 
Net annual recurring savings: 1.8; 
Payback period: 4 years; 
20-year net present value savings[B]: $18.1. 

Realign March Air Reserve Base, CA; 
DOD report page: AF-11; 
One-time (costs): ($10.8); 
Net implementation (costs) or savings[A]: ($1.9); 
Net annual recurring savings: 1.8; 
Payback period: 5 years; 
20-year net present value savings[B]: $15.5. 

Realign Richmond Air Guard Station, VA; 
DOD report page: AF-50; 
One-time (costs): ($24.2); 
Net implementation (costs) or savings[A]: ($11.6); 
Net annual recurring savings: 2.5; 
Payback period: 10 years; 
20-year net present value savings[B]: $13.2. 

Realign Hector Air Guard Station, ND; 
DOD report page: AF-38; 
One-time (costs): ($1.8); 
Net implementation (costs) or savings[A]: $3.3; 
Net annual recurring savings: 1.0; 
Payback period: 2 years; 
20-year net present value savings[B]: $12.9. 

Realign Fairchild Air Force Base, WA; 
DOD report page: AF-51; 
One-time (costs): ($6.4); 
Net implementation (costs) or savings[A]: ($1.6); 
Net annual recurring savings: 1.0; 
Payback period: 7 years; 
20-year net present value savings[B]: $8.3. 

Establish centralized intermediate repair facility-F-15 Avionics 
(Langley Air Force Base, VA); 
DOD report page: AF-49; 
One-time (costs): ($1.8); 
Net implementation (costs) or savings[A]: $1.5; 
Net annual recurring savings: 0.7; 
Payback period: 3 years; 
20-year net present value savings[B]: $8.3. 

Realign Duluth Air Guard Station, MN; 
DOD report page: AF-28; 
One-time (costs): ($2.1); 
Net implementation (costs) or savings[A]: $0.2; 
Net annual recurring savings: 0.8; 
Payback period: 5 years; 
20-year net present value savings[B]: $7.8. 

Establish F100 engine centralized intermediate repair facilities; 
DOD report page: AF-55; 
One-time (costs): ($9.2); 
Net implementation (costs) or savings[A]: ($3.8); 
Net annual recurring savings: 1.1; 
Payback period: 9 years; 
20-year net present value savings[B]: $7.1. 

Realign Beale Air Force Base, CA; 
DOD report page: AF-10; 
One-time (costs): ($45.4); 
Net implementation (costs) or savings[A]: ($34.6); 
Net annual recurring savings: 3.9; 
Payback period: 14 years; 
20-year net present value savings[B]: 6.4. 

Realign Capital Air Guard Station, IL; 
DOD report page: AF-20; 
One-time (costs): ($19.9); 
Net implementation (costs) or savings[A]: ($13.3); 
Net annual recurring savings: 2.0; 
Payback period: 13 years; 
20-year net present value savings[B]: $6.3. 

Realign Ellington Air Guard Station, TX; 
DOD report page: AF-45; 
One-time (costs): ($1.6); 
Net implementation (costs) or savings[A]: $0.1; 
Net annual recurring savings: 0.4; 
Payback period: 5 years; 
20-year net present value savings[B]: $3.6. 

Realign Key Field Air Guard Station, MS; 
DOD report page: AF-28; 
One-time (costs): ($10.7); 
Net implementation (costs) or savings[A]: ($6.9); 
Net annual recurring savings: 0.9; 
Payback period: 13 years; 
20-year net present value savings[B]: $2.5. 

Realign Schenectady Air Guard Station, NY; 
DOD report page: AF-34; 
One-time (costs): ($3.5); 
Net implementation (costs) or savings[A]: ($3.3); 
Net annual recurring savings: 0.6; 
Payback period: 8 years; 
20-year net present value savings[B]: $2.4. 

Realign Fort Smith Air Guard Station, AR; 
DOD report page: AF-8; 
One-time (costs): ($17.6); 
Net implementation (costs) or savings[A]: ($12.4); 
Net annual recurring savings: 1.4; 
Payback period: 16 years; 
20-year net present value savings[B]: $2.0. 

Realign Boise Terminal Air Guard Station, ID; 
DOD report page: AF-17; 
One-time (costs): ($2.5); 
Net implementation (costs) or savings[A]: ($1.6); 
Net annual recurring savings: 0.3; 
Payback period: 8 years; 
20-year net present value savings[B]: $1.7. 

Realign Springfield-Beckley Air Guard Station, OH; 
DOD report page: AF-40; 
One-time (costs): ($11.4); 
Net implementation (costs) or savings[A]: ($8.4); 
Net annual recurring savings: 0.9; 
Payback period: 17 years; 
20-year net present value savings[B]: $0.7. 

Realign Birmingham Air Guard Station, AL; 
DOD report page: AF-5; 
One-time (costs): ($11.0); 
Net implementation (costs) or savings[A]: ($7.7); 
Net annual recurring savings: 0.8; 
Payback period: 18 years; 
20-year net present value savings[B]: $0.5. 

Total; 
DOD report page: 
; 
One-time (costs): ($1,883.1); 
Net implementation (costs) or savings[A]: $2,635.5; 
Net annual recurring savings: $1,248.5; 
Payback period: 
20-year net present value savings[B]: $14,560.3. 

[End of table]

Source: GAO analysis of DOD data. 

[A] This represents net costs or savings within the 6-year 
implementation period required to implement BRAC recommendations. 

[B] DOD used a 2.8 percent discount rate to calculate net present 
value. 

[C] The Pope Air Force Base recommendation includes the closure of 
Pittsburgh Air Reserve Station and the realignment of Yeager Air Guard 
Station and Little Rock Air Force Base. 

Over 80 percent of the projected 20-year savings are based on the first 
5 recommendations shown in table 17, which involve closing two and 
realigning three active bases and have payback periods of 1 year or 
less. Conversely, the one-time costs of over $1.8 billion to implement 
all recommendations are primarily comprised of new military 
construction to implement the recommendations. Most of the Air Force's 
recommendations involve realignment of Air Guard facilities with 
limited savings. For example, the Air Force is proposing to realign 
five Air National Guard stations, with payback periods greater than 10 
years and $12 million in 20-year savings, with onetime costs of about 
$71 million. According to Air Force officials, these proposals were 
necessary because the Air Force recommendations are interwoven, 
depending on realignment actions from other recommendations. For 
example, 72 realignment and closure recommendations involving active 
and reserve installations were combined to create 42 candidate 
recommendations. At least one segment of all but 3 of the 42 Air Force 
recommendations that were combined[Footnote 82] affects the Air Force 
Reserve Command or Air National Guard. 

Based on our analysis we noted that the majority of the net annual 
recurring savings (60 percent) are cost avoidances from military 
personnel eliminations. However, eliminations are not expected to 
result in reductions to active duty, Air Reserve and Air National Guard 
end strengths, limiting savings available for other purposes. 

None of the recommendations included in the Air Force's report involve 
consolidation or integration of activities or functions with those of 
another military service.[Footnote 83] However, the Air Force believes 
that its recommendations to realign Pope Air Force Base, North 
Carolina, and Eielson Air Force Base, Alaska, and to move A-10 aircraft 
to Moody Air Force Base, Georgia, will provide an opportunity for joint 
close air support training with Army units stationed at Forts Benning 
and Stewart, Georgia. Furthermore, the Air Force's recommendations 
support transformation efforts by optimizing (increasing) squadron size 
for most fighter and mobility aircraft.[Footnote 84] According to the 
Air Force BRAC report, the recommendations maximize warfighting 
capability by fundamentally reshaping the service, effectively 
consolidating older weapons systems into fewer but larger squadrons, 
thus reducing excess infrastructure and improving the operational 
effectiveness of major weapons systems. We have previously reported 
that the Air Force's could not only reduce infrastructure by increasing 
the number of aircraft per fighter squadron but could also save 
millions of dollars annually.[Footnote 85]

Issues Identified with Approved Recommendations: 

Time did not permit us to assess the operational impact of each 
recommendation, particularly where recommendations involve multiple 
locations. Nonetheless, we offer a number of broad-based observations 
about the proposed recommendations and selected observations on some 
individual recommendations. Our analysis of the Air Force 
recommendations identified some issues that the BRAC Commission may 
wish to consider, such as the projected savings from military personnel 
reductions; impact on the Air National Guard, impact on other federal 
agencies; and other issues related to the realignments of Pope Air 
Force Base, North Carolina; Eielson Air Force Base, Alaska; and Grand 
Forks Air Force Base, North Dakota and the closure of Ellsworth Air 
Force Base, South Dakota. 

Military Personnel Savings: 

Our analysis showed that about $732 million, or about 60 percent, of 
the projected $1.2 billion net annual recurring savings are based on 
savings from eliminating military personnel positions. Initially, the 
Air Force counted only military personnel savings that resulted in a 
decrease in end strength. However, at the direction of OSD, the Air 
Force included savings for all military personnel positions that were 
made available through realignment or closure recommendations. The Air 
Force was unable to provide us documentation showing at the present 
time to what extent each of these positions will be required to support 
future missions. According to Air Force officials, they envision that 
most active slots will be needed for formal training, and all the Air 
Reserve and Air National Guard personnel will be assigned to stressed 
career fields and emerging missions. Furthermore, Air Force officials 
said that positions will also be reviewed during the Quadrennial 
Defense Review, which could decrease end strength. Either way, claiming 
such personnel as BRAC savings without reducing end strength does not 
provide dollar savings that can be reapplied outside personnel accounts 
and could result in the Air Force having to find other sources of 
funding for up-front investment costs needed to implement its BRAC 
recommendations. 

Impact on the Air National Guard and Reserve Components: 

At least one segment of all but 3 of the 42 Air Force recommendations 
that were combined[Footnote 86] affects the Air Force Reserve Command 
or Air National Guard. The Air Force BRAC report lists 7 closures and 
35 Air Reserve and Air National Guard realignments.[Footnote 87] 
Overall, 68 Reserve Command (12) and Air National Guard (56) 
installations were affected by a closure or realignment, or they 
received aircraft or missions from these actions. According to Air 
Force officials, its BRAC recommendations have resulted in a reduction 
of 29 installations with flying missions. Of these reduced 
installations with flying missions, over 75 percent, or 22, are from 
the Air National Guard. If implemented the BRAC recommendations will 
affect over 30 percent of the 70 Air National Guard and 13 Air Reserve 
installations with air flying units, respectively. Table 18 shows the 
reduction of flying units in the BRAC process by active force, Air 
Force Reserve Command, and the Air National Guard. 

Table 18: Impact of Air Force BRAC Recommendations on Installations 
with Flying Missions, by Component: 

Component: Active; 
Installations with flying missions: Pre-BRAC: 59; 
Installations with flying missions: Post-BRAC: 56; 
Change: Number: 3; 
Change: Number: 2. 

Component: Air Force Reserve; 
Installations with flying missions: Pre-BRAC: 13; 
Installations with flying missions: Post-BRAC: 9; 
Change: Number: 4; 
Change: Number: 3. 

Component: Air National Guard; 
Installations with flying missions: Pre-BRAC: 70; 
Installations with flying missions: Post-BRAC: 48; 
Change: Number: 22; 
Change: Number: 15. 

Total; 
Installations with flying missions: Pre-BRAC: 142; 
Installations with flying missions: Post-BRAC: 113; 
Change: Number: 29; 
Change: Number: 20. 

Source: Department of the Air Force. 

[A] All percentage changes were calculated by using the change in 
number of installations with air flying units divided by the pre-BRAC 
total installation number of 142. 

[End of table]

Based on our analysis of COBRA data, we estimate that more than 1,419 
positions in the Air Reserve and 5,700 positions in the Air National 
Guard will be affected by the proposed recommendations, in terms of 
military personnel and civilians eliminated and realigned. In 
recommendations affecting active installations, over 26,000 positions 
are affected (eliminated and realigned); however, since the Air Force 
has combined active and reserve component actions in some 
recommendations those positions also include additional Air National 
Guard and Air Reserve personnel.[Footnote 88] Also the Air Force 
recognizes that in moving Air National Guard and Air Reserve units, 
part-time military (commonly referred to as drill) personnel will also 
be affected since they will not be moved.[Footnote 89] A significant 
portion of the personnel associated with these units must be replaced 
at the gaining installation and will require training. At Air National 
Guard installations with flying units, over 30 percent have been 
recommended for realignment or retirement; many of the personnel 
positions associated with the units do not have missions. Air Force 
officials said they plan to use these positions for emerging missions 
in such areas as homeland security, unmanned aerial vehicles, and 
intelligence, which they expect to further refine as part of the 
ongoing Quadrennial Defense Review. 

Initially, many of the Air Force proposals involving the Air National 
Guard and Air Force Reserve with payback periods ranging from 10 to 
more than 100 years were stand-alone recommendations. Those 
recommendations linked by related operational realignment actions were 
grouped together to produce recommendations that had significant 
savings and minimized the longer payback periods. We found that this 
occurred in the realignment of Lambert-St. Louis International Airport 
Air Guard Station, Missouri, which originally had a 63-year payback 
period and resulted in a 20-year net present value cost of $22 million. 
However, this realignment is now a part of the closure of Otis Air 
National Guard Base, Massachusetts, and the realignment of Atlantic 
City Air Guard Station, New Jersey because of related operational 
realignment actions. The current combined recommendation results in a 
20-year net present value savings of $336 million and a 3-year payback 
period. Figure 12 shows the various BRAC actions in this 
recommendation. For example, 18 F-15 fighter aircraft are realigned 
from Otis Air National Guard Base and Lambert-St. Louis Air Guard 
Station to Atlantic City Air Guard Station. Furthermore, all three Air 
Guard Stations also realign other aircraft to three separate 
installations, Nellis Air Force Base, Nevada; Burlington Air Guard 
Station, Vermont; and Jacksonville Air Guard Station, Florida. 

Figure 12: Realignment of Fighter Aircraft at Lambert-St. Louis Air 
Guard Station and Otis Air National Guard Base: 

[See PDF for image] 

[End of figure] 

Finally, questions have been raised by various state officials whether 
the Secretary of Defense is authorized to close or realign Air National 
Guard bases without the consent of the state governor. DOD's Office of 
General Counsel has not issued a legal opinion on this issue. According 
to an Air Force official, as of the date of this report, there have 
been no legal challenges brought against DOD regarding this issue. 

Impact on the Coast Guard: 

The Air Force recommendation to close Otis Air National Guard Base 
could impact the U.S. Coast Guard.[Footnote 90] While the Air Force 
officials recognized the Coast Guard could be affected if the base was 
closed, their cost and savings analysis did not consider any costs that 
could be incurred by the Coast Guard. Air Force officials stated they 
didn't have access to credible cost data during the BRAC process since 
cost estimates would have been speculative; the Air Force could not 
assume the final disposition of the facility and how much, if any, of 
the facility the Coast Guard would opt to retain. The Coast Guard is in 
the process of developing potential basing alternatives, to include 
costs impacts, for each affected location. Subsequent to the 
recommendations being made public, the Coast Guard estimated that they 
would incur about $17 million in additional annual operating costs to 
remain at Otis Air National Guard Base. 

Realignment of Selected Active Bases: 

The realignment of Pope Air Force Base[Footnote 91] involves the 
transfer of 100 percent of the acres and facilities to the Army to 
become part of Fort Bragg, with a C-130 active/reserve associate unit 
remaining to support the Army. Our analysis indicates that there is a 
significant difference between the savings claimed by the Air Force and 
the costs projected by the Army regarding base operations support, 
recapitalization, and sustainment for facilities on Pope Air Force 
Base. For example, the Air Force claimed total net annual recurring 
savings of about $36 million for not providing base operations support 
and recapitalization and sustainment of facilities on Pope Air Force 
Base. However, the Army estimated total annual recurring costs for 
these areas to be about $19.5 million. This estimated cost comprises 
over $13 million from the Army as well as over $5.5 million from the 
Air Force to remain as tenant at Fort Bragg. According to Army 
officials, their estimated costs included taking ownership for all 
facilities on Pope Air Force Base. 

The Air Force is also proposing to realign Eielson Air Force Base by 
moving all active duty units, leaving the Air National Guard units, and 
hiring contractors to provide base operating support and maintenance 
and repair of the facilities. The Air Force projects this action would 
produce a 20-year net present value savings of $2.8 billion, the most 
of any Air Force recommendation. Air Force officials said the decision 
to realign Eielson was made because of the high cost of operating the 
base and its value as major training site. The officials noted that the 
realignment will enable the Air Force to expand an annual training 
exercise as well as provide opportunities for increase use of the 
training area by other Air Force units. However, we have some question 
about the facilities that need to be retained to support the training 
mission and Air National Guard units. While the Air Force plans to give 
up the base family housing, it appears that all other base facilities 
would be retained. For example, Air Force COBRA data indicates that 
there will be no reduction in the square feet of facilities. The data 
also indicates that 64 percent of the facilities will be sustained at 
current funding. 

The Air Force proposed to close Grand Forks Air Force Base[Footnote 92] 
but this was changed to a realignment by the Infrastructure Executive 
Council a week before the recommendations were finalized within the 
department. As a result, the projected savings were significantly 
reduced, as shown in table 19. 

Table 19: Comparison of Alternatives to Closing or Realigning Grand 
Forks Air Force Base: 

Fiscal year 2005 constant dollars in millions. 

One-time costs; 
Closure recommendation: ($128.6); 
Realignment recommendation: ($131.5); 
Difference: ($2.9). 

6-year net savings; 
Closure recommendation: $490.0; 
Realignment recommendation: $322.5; 
Difference: $167.5. 

Net implementation (costs) or savings; 
Closure recommendation: $226.6; 
Realignment recommendation: $173.3; 
Difference: $53.3. 

Payback period; 
Closure recommendation: immediate; 
Realignment recommendation: 1 year; 
Difference: 1 year. 

20-year net present value savings; 
Closure recommendation: $2,656.3; 
Realignment recommendation: $1,982.0; 
Difference: $674.3. 

Source: GAO analysis of Air Force data. 

[End of table]

The decision to realign rather than close the base did not affect the 
need to move current aircraft and associated personnel to other bases 
to achieve the active and reserve mix. According to the Air Force BRAC 
report, this change to a realignment was based on military judgment to 
keep a strategic presence in the north central United States and on the 
fact that Grand Forks Air Force Base ranked high for acquiring a 
possible unmanned aerial vehicle mission.[Footnote 93] Even though 
Grand Forks Air Force Base was retained for strategic reasons, Minot 
Air Force Base is also located in North Dakota and is not affected by 
any BRAC recommendation. Furthermore, Minot Air Force Base scored only 
3.4 points less than Grand Forks Air Force Base in the unmanned aerial 
vehicle mission area. 

Closure of Ellsworth Air Force Base: 

The Air Force is proposing to close Ellsworth Air Force Base, South 
Dakota, and move its 24 B-1 bomber aircraft to Dyess Air Force Base, 
Texas to achieve operational efficiencies at one location. Ellsworth 
Air Force Base ranked lower in the military value than Dyess Air Force 
Base. In the 1995 BRAC round,[Footnote 94] the Air Force considered but 
chose not to close Ellsworth Air Force Base out of concern over placing 
all B-1 aircraft at a single location. In contrast, one of the Air 
Force principles which guided the BRAC 2005 process emphasized 
consolidating or co-locating legacy fleets such as the B-1 aircraft. 
Air Force officials stated that they no longer had concerns about 
consolidating the B-1 fleet in one location because it does not have 
the same operational mission requirements it had 10 years ago. 

[End of section]

Appendix VI: Education and Training Joint Cross-Service Group Selection 
Process and Recommendations: 

The Education and Training Joint Cross-Service Group followed the 
common analytical framework established by the Office of the Secretary 
of Defense (OSD) for reviewing its functions and facilities. The group 
produced a relatively small number of recommendations (nine) compared 
with the amount of excess capacity it identified. The group reported 
that the Infrastructure Steering Group (ISG) or the Infrastructure 
Executive Council (IEC) had each disapproved two recommendations for 
various reasons, and four recommendations were rolled into military 
department recommendations and are discussed in appendixes related to 
these groups. The group's recommendations are projected to produce $1.3 
billion in net present value savings over a 20-year period. For these 
recommendations, the length of time required for the savings to offset 
closure costs varied widely, with two recommendations expected to take 
just 1 year, two other recommendations requiring 13 and 16 years, 
respectively, and one never having any payback. We identified issues 
regarding the projected savings and extended payback periods with some 
recommendations that may warrant further attention by the BRAC 
Commission. The DOD Inspector General and service audit agencies, which 
performed audits of the data used in the process, concluded that the 
data were sufficiently reliable for use during the BRAC process. 

Organization and Focus: 

The overarching goal of the Education and Training Joint Cross-Service 
Group was to pursue those educational and training economies and 
efficiencies that enhance readiness and promote academic synergies for 
more joint or interservice education. The group was chaired by the 
Principal Deputy Under Secretary of Defense (Personnel and Readiness), 
with senior-level members from Air Force Manpower and Reserve Affairs, 
Marine Corp Training and Education Command, Army and Naval Personnel, 
and the Joint Staff. This cross-service group was organized into four 
subgroups,[Footnote 95] focusing on (1) flight training, (2) 
specialized skill training, (3) professional development education, and 
(4) ranges. 

The group identified five principles that were used to provide focus to 
its work: 

* Advance jointness: Declare jointness paramount for specific 
functions. Establish Joint National Training Capability. 

* Achieve synergy: Jointly construct, co-locate or put in close 
proximity multiple functions that are mutually supportive. Increase 
cross-functional use of training and testing ranges. 

* Capitalize on technology: Leverage distance learning capability to 
significantly reduce residential requirements. 

* Exploit best practices: Establish centers of excellence. Outsource to 
alternative providers. 

* Minimize redundancy: Identify common functional areas and eliminate 
duplication, reduce or avoid costs, standardize instruction, and 
increase efficiency. 

The organizational structure and the above guiding principles provided 
a framework to evaluate the potential of a broad series of 
transformational options to improve DOD education and training. 

Framework for Analysis: 

Capacity and military value analysis became the starting point for the 
group's analyses. The DOD Inspector General and service audit agencies 
performed an important role in ensuring the accuracy of data used in 
these analyses through selective audits of data gathered at various 
locations. 

Capacity Analysis: 

To form the basis for its analyses, the group developed metrics in each 
of the functional areas to measure capacity and subsequently collected 
certified data linked to these metrics from various defense activities 
whose missions resided within these categories. Each subgroup developed 
metrics to analyze capacity and to compare the various functions. The 
major standards used by each subgroup are described below: 

* For undergraduate fixed and rotary flight training, runway and 
airspace capacity were the primary metrics used to analyze capacity. 
Runway capacity for fixed wing aircraft was calculated using Federal 
Aviation Administration standards to define the number of runway 
operations that could be conducted during daylight hours for 244 
training days, at 12 hours per day. This approach accounted for weather 
conditions, the number and configuration of runways, the mix of 
aircraft, and the percentage of touchdown/takeoff operations. Other 
metrics included the amount of ramp (apron) space and ground-training 
facilities, such as classrooms and simulators. 

* For professional development education, capacity was based on 
classroom equivalent hours available on a 6-hour training day basis for 
244 days a year. Classroom equivalent hours represent the number of 1-
hour classes (15 students per class) that can be held in designated 
facilities, and they are based on available classroom space and 
instructor office space. 

* For specialized skill training, capacity was measured by the student 
population that can be sustained by the number of available dormitory 
rooms, dining facilities, and classrooms. This figure was based on an 8-
hour training day for 244 days per year. 

* For ranges, capacity was based on the volume and time for training 
and open air testing at ground, air, and sea levels. 

Each subgroup focused its capacity analysis on the existing capability 
to perform specific functions. Surge requirements, where applicable, 
were determined by military judgment. Excess capacity was defined as 
current capacity less current usage plus surge capacity. As seen in 
table 20, significant excess capacity was identified across all 
education and training functions except for the ranges subgroup. 

Table 20: Excess Capacity Identified by the Education and Training 
Joint Cross-Service Group: 

Subgroup/function: Flight training; Undergraduate fixed wing: 

Capacity metric: Runway; 
Percentage of excess capacity (shortage): 45%. 

Capacity metric: Airspace; 
Percentage of excess capacity (shortage): 51%. 

Capacity metric: Ramp space; 
Percentage of excess capacity (shortage): 23%. 

Capacity metric: Classrooms; 
Percentage of excess capacity (shortage): 62%. 

Capacity metric: Simulator; 
Percentage of excess capacity (shortage): 48. 

Subgroup/function: Undergraduate rotary wing: 

Capacity metric: Runway; 
Percentage of excess capacity (shortage): 76%. 

Capacity metric: Ramp space; 
Percentage of excess capacity (shortage): 52%. 

Capacity metric: Classrooms; 
Percentage of excess capacity (shortage): 73%. 

Capacity metric: Simulator; 
Percentage of excess capacity (shortage): 71%. 

Subgroup/function: Undergraduate navigator/naval flight officer: 

Capacity metric: Runway; 
Percentage of excess capacity (shortage): 57%. 

Capacity metric: Airspace; 
Percentage of excess capacity (shortage): 35%. 

Capacity metric: Ramp space; 
Percentage of excess capacity (shortage): 48%. 

Capacity metric: Classrooms; 
Percentage of excess capacity (shortage): 84%. 

Capacity metric: Simulator; 
Percentage of excess capacity (shortage): 55%. 

Subgroup/function: Professional development education: 

Capacity metric: Classroom equivalent hours; 
Percentage of excess capacity (shortage): 58%. 

Subgroup/function: Specialized skill training: 

Capacity metric: Dormitory rooms; 
Percentage of excess capacity (shortage): 10%. 

Capacity metric: Dining facilities; 
Percentage of excess capacity (shortage): (45%). 

Capacity metric: Classrooms; 
Percentage of excess capacity (shortage): 42%. 

Subgroup/function: Ranges: Training: 

Capacity metric: Ground acreage; 
Percentage of excess capacity (shortage): 0%. 

Capacity metric: Air nautical miles; 
Percentage of excess capacity (shortage): 0%. 

Capacity metric: Sea nautical miles; 
Percentage of excess capacity (shortage): 28%. 

Subgroup/function: Ranges: Test and evaluation: 

Capacity metric: Open air testing; 
Percentage of excess capacity (shortage): 9%. 

Source: Education and Training Joint Cross-Service Group. 

[End of table]

The percentage of excess capacity includes consideration of surge 
requirements for all functions except professional development 
education.[Footnote 96] According to service officials, in the event of 
a mobilization, postgraduate educational institutions and facilities 
would cease to operate and the students would revert back to their 
warfighting duties. The surge requirements for the remaining functions 
were based on military judgment. For example, the flight and 
specialized skill training subgroups used a 20 percent surge factor 
based on a review of current planning documents and military judgment. 
Likewise, a 25 percent surge factor was used for training ranges and a 
10 percent factor for test and evaluation ranges, based on military 
judgment. According to service officials, a higher surge factor was 
used for training ranges to meet anticipated training needs for 
contingencies and mobilization, while test and evaluation are more 
measured and predictable and less likely to generate large surge loads 
on test and evaluation missions. 

The group did not analyze the extent to which its proposed 
recommendations would reduce excess capacity across all education and 
training functions. Nonetheless, the Air Force estimated that the 
recommendation to consolidate undergraduate pilot training would reduce 
excess capacity by 2 percent. At the same time, the excess capacity 
identified will remain in undergraduate rotary wing training because 
the Navy could not agree on a scenario to consolidate training. Since 
there were no recommendations involving training ranges, there was no 
reduction in excess capacity in the sea and open air testing areas. 

Military Value Analysis: 

Each subgroup developed military value scoring plans to analyze and 
rank each training facility using DOD's four military value selection 
criteria. The subgroups assigned weighted values to each of the four 
criteria based on relative importance in assessing the military value 
of a site under each subgroup and related functions. Table 21 shows the 
weights for each subgroup. 

Table 21: Education and Training Joint Cross-Service Group Military 
Value Criteria Weights: 

Figures in percentages. 

Military value criteria: 1. The current and future mission capabilities 
and the impact on operational readiness of the total force of the 
Department of Defense, including the impact on joint warfighting, 
training, and readiness; 
Flight training: 40%; 
Specialized skill training: 44%; 
Professional development education: 40%; 
Ranges: 25%. 

Military value criteria: 2. The availability and condition of land, 
facilities, and associated airspace (including training areas suitable 
for maneuver by ground, naval, or air forces throughout a 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; 
Flight training: 35%; 
Specialized skill training: 32%; 
Professional development education: 25%; 
Ranges: 50%. 

Military value criteria: 3. The ability to accommodate contingency, 
mobilization, surge, and future total force requirements at both 
existing and potential receiving locations to support operations and 
training; 
Flight training: 5%; 
Specialized skill training: 9%; 
Professional development education: 10%; 
Ranges: 15%. 

Military value criteria: 4. The cost of operations and the manpower 
implications; 
Flight training: 20%; 
Specialized skill training: 15%; 
Professional development education: 25%; 
Ranges: 10%. 

Total; 
Flight training: 100%; 
Specialized skill training: 100%; 
Professional development education: 100%; 
Ranges: 100%. 

Source: DOD and Education and Training Joint Cross-Service Group. 

Note: The system of weights provided a basis for assigning relative 
value to data collected and tabulated across each military value 
dimension. 

[End of table]

Some key assumptions used by the subgroups in developing scoring plans 
for military value include the following: 

* Installations with larger capacities are of comparatively greater 
military value for flight training and specialized skill training. 

* Managed training areas (particularly airspace) would be extremely 
hard to reconstitute if lost due to the BRAC process. 

* Existing service qualitative training requirements must be 
maintained. 

* Retain unique, one-of-a-kind assets or capabilities. 

Attributes varied by subgroup. For example, the flight training 
subgroup identified six attributes that included airfield capacity, 
weather, environmental constraints (air quality, noise abatement, and 
encroachment), quality of life, managed training areas, and ground 
training facilities. The professional development subgroup applied 
location (access to senior political and military decision makers), 
educational output, facilities, educational staff, and quality of life. 
The specialized skill training subgroup attributes included location, 
quality of life issues, training facilities/resources (number of 
classrooms and available housing), support for other missions, training 
mission/throughput, and environmental constraints/expansion potential. 
Finally, the attributes for the ranges subgroup included personnel 
(experience and education), workload, physical plant (available space 
and range features), synergy with other ranges, and encroachment. 
Figure 13 gives an example of how the flight training subgroup was 
linked to the military value criteria. 

Figure 13: Selected Attributes, Metrics, and Data Questions Used to 
Assess Military Value of Flight Training: 

[See PDF for image] 

[A] The BRAC military value criteria are the first four BRAC selection 
criteria. 

[B] Military value attributes are characteristics of each criterion. 
The flight training subgroup used a total of six military value 
attributes. 

[C] Military value metrics are measures for the attributes. The flight 
training subgroup used a total of 22 military value metrics. 

[D] The flight training subgroup used a total of 70 data call 
questions. 

[End of figure] 

The specialized skill training, professional development education, and 
ranges subgroups used similar approaches of attributes, metrics, and 
data call questions to link analysis back to the military value 
criteria. 

DOD Inspector General's and Service Audit Agencies' Roles in the 
Process: 

The DOD Inspector General and service audit agencies reviewed the data 
and processes used by each subgroup to develop their recommendations. 
The overall objective was to evaluate the validity, integrity, and 
documentation of the data used by the subgroups. The DOD Inspector 
General and service audit agencies used real-time audit coverage of 
data collection and analyses processes to ensure that the data used in 
the Education and Training Joint Cross-Service Group capacity analysis 
and military value analysis were reliable and certified. Through 
extensive audits of the data collected by each subgroup from field 
activities during the process, the Inspector General and service audit 
agencies notified the group about identified data discrepancies for the 
purpose of follow-on corrective action. While the process for 
validating data was quite lengthy and challenging, the Inspector 
General and the service audit agencies ultimately determined the 
education and training-related data to be sufficiently reliable for use 
in the BRAC process once the subgroups made corrections to all the 
discrepancies. 

Identification and Assessment of Alternate Scenarios and Selection of 
Recommendations: 

Although corrections were later made, the group did not have accurate 
and complete capacity and military value data when it started 
developing potential closure and realignment scenarios, and therefore, 
it had to rely on incomplete data, military judgment, and 
transformation options[Footnote 97] in developing initial scenarios for 
consideration. However, certified capacity and military value data and 
results of COBRA analyses were subsequently used to support the group's 
final candidate recommendations. The group initially identified 64 
scenarios and selected 17 candidate recommendations that were forwarded 
to the ISG. Four of the recommendations were rejected by the ISG and 
IEC and 4 of the group's recommendations were integrated into military 
service recommendations. Ultimately, 9 recommendations were approved by 
the IEC. 

Generally, scenarios were eliminated because they were alternatives to 
a recommendation that was selected or because the services objected to 
the scenario and the group leadership decided to delete it. For 
example, the professional development education subgroup developed 
three scenarios to streamline graduate education courses--two to 
consolidate these functions at existing military facilities and another 
to obtain graduate-level education at civilian colleges and 
universities. The group selected the privatization option because of 
the significant savings; however, it was rejected by the IEC, as 
discussed later. The professional development education subgroup also 
developed nine scenarios to realign the senior-level education courses 
provided by the service war colleges. The group elected to relocate the 
service war colleges under the National Defense University as the "best 
choice" option because it establishes a joint strategic center of 
excellence in the National Capitol Region. However, the IEC rejected 
this option, as discussed later. Finally, the flight subgroup developed 
eight alternatives to consolidate undergraduate pilot training. 
However, the Navy and the Air Force objected to these scenarios because 
they believed they would result in too much disruption to the pilot 
production pipeline. 

The flight training subgroup was the only subgroup that used an 
optimization model in its scenario analysis. The subgroup used it to 
identify potential locations to consolidate undergraduate fixed wing 
pilot training functions among 11 installations. According to flight 
subgroup officials, the model was not used for rotary wing pilot 
training because there are only two locations where this training is 
conducted. Likewise, they noted that it was not used to select sites 
for the Joint Strike Fighter and Unmanned Aerial Vehicle training 
because there were limited sites selected for this training. Officials 
from the other three subgroups stated they did not use the model 
because of the limited number of facilities or functions reviewed. For 
example, the professional development education subgroup compared from 
two to six locations within each scenario, so the team manually 
developed scenarios by maximizing military value and capitalizing on 
excess capacity. 

Recommendations Approved by DOD: 

The group estimated that its recommendations will produce $1.3 billion 
in 20-year savings and $236 million in net annual recurring savings. 
Table 22 provides a summary of the financial aspects of the group's 
recommendations, all of which are realignment actions. 

Table 22: Financial Aspects of the Education and Training Joint Cross-
Service Group's Recommendations: 

Fiscal year 2005 constant dollars in millions. 

Recommended actions: Realignment to establish Combat Service Support 
Center at Fort Lee; 
DOD report page: E&T-6; 
One-time (costs): ($754.0); 
Net implementation (costs) or savings: $352.4; 
Net annual recurring (costs) or savings: $131.8; 
Payback period[A]: (years): 6; 
20-year net present value (costs) or savings[B]: $934.2. 

Recommended actions: Realignment to relocate Air Defense Artillery 
Center and School to Fort Sill; 
DOD report page: E&T-12; 
One-time (costs): ($247.0); 
Net implementation (costs) or savings: ($93.0); 
Net annual recurring (costs) or savings: $42.6; 
Payback period[A]: (years): 6; 
20-year net present value (costs) or savings[B]: $319.1. 

Recommended actions: Realignment to establish Joint Strike Fighter 
initial joint training site at Eglin Air Force Base; 
DOD report page: E&T-10; 
One-time (costs): ($199.1); 
Net implementation (costs) or savings: ($209.6); 
Net annual recurring (costs) or savings: ($3.3); 
Payback period[A]: (years): never; 
20-year net present value (costs) or savings[B]: ($226.3). 

Recommended actions: Realignment of various installations to 
consolidate undergraduate pilot and navigator training; 
DOD report page: E&T-14; 
One-time (costs): ($71.7); 
Net implementation (costs) or savings: ($1.6); 
Net annual recurring (costs) or savings: $18.3; 
Payback period[A]: (years): 4; 
20-year net present value (costs) or savings[B]: $174.2. 

Recommended actions: Realignment to relocate Aviation Logistics School 
to Fort Rucker; 
DOD report page: E&T-5; 
One-time (costs): ($492.3); 
Net implementation (costs) or savings: ($348.1); 
Net annual recurring (costs) or savings: $42.9; 
Payback period[A]: (years): 13; 
20-year net present value (costs) or savings[B]: $77.4. 

Recommended actions: Realignment to establish Joint Center of 
Excellence for consolidated transportation management training at Fort 
Lee; 
DOD report page: E&T-7; 
One-time (costs): ($1.5); 
Net implementation (costs) or savings: ($5.8); 
Net annual recurring (costs) or savings: $1.3; 
Payback period[A]: (years): 1; 
20-year net present value (costs) or savings[B]: $18.0. 

Recommended actions: Realignment to establish Joint Center of 
Excellence for culinary training at Fort Lee; 
DOD report page: E&T-8; 
One-time (costs): ($5.4); 
Net implementation (costs) or savings: ($2.6); 
Net annual recurring (costs) or savings: $1.4; 
Payback period[A]: (years): 2; 
20-year net present value (costs) or savings[B]: $15.7. 

Recommended actions: Realignment to establish Joint Center of 
Excellence for religious training and education at Fort Jackson; 
DOD report page: E&T-9; 
One-time (costs): ($1.0); 
Net implementation (costs) or savings: $4.0; 
Net annual recurring (costs) or savings: $0.8; 
Payback period[A]: (years): 1; 
20-year net present value (costs) or savings[B]: $11.9. 

Recommended actions: Realignment to relocate Army Prime Power School 
training to Fort Leonard Wood; 
DOD report page: E&T-13; 
One-time (costs): ($6.0); 
Net implementation (costs) or savings: ($3.9); 
Net annual recurring (costs) or savings: $0.5; 
Payback period[A]: (years): 16; 
20-year net present value (costs) or savings[B]: $0.8. 

Total; 
One-time (costs): ($1,778); 
Net implementation (costs) or savings: ($308.2); 
Net annual recurring (costs) or savings: $236.3; 
20-year net present value (costs) or savings[B]: $1,325. 

Source: GAO analysis of DOD data. 

[A] Payback period refers to the length of time required for the 
savings to offset closure costs. 

[B] DOD used a 2.8 percent discount rate to calculate net present 
value. 

[End of table]

Our analysis indicates that $1.3 billion, or over 95 percent, of the 
group's projected 20-year savings results from two recommendations that 
involve only the Army--the combat service support center and the air 
defense artillery center. The greater part of the projected savings 
from these two recommendations is based on military personnel 
reductions. 

While five of the nine recommendations would foster jointness, they 
have limited projected savings. For example, the three recommendations 
that would establish joint centers of excellence for training 
(culinary, transportation management, and religious studies) are 
projected to produce only $45.6 million, or less than 1 percent, of the 
projected 20-year savings. Furthermore, the recommendation to 
consolidate the Joint Strike Fighter training has a payback period of 
never and a 20-year net present value cost of $226 million. 

Issues Identified with Approved Recommendations: 

Time did not permit us to assess the operational impact of each of the 
Education and Training Joint Cross-Service group's recommendations, 
particularly where operations proposed for consolidation extend across 
multiple locations outside of a single geographic area. While available 
data supporting the recommendations suggest that their implementation 
should provide for more efficient operations within DOD, the BRAC 
Commission may wish to consider the basis for the group's assumptions 
about military personnel reductions, because these have a significant 
impact on the recommendations' annual recurring savings and the 
potential benefits in relation to the investment costs for 
recommendations with longer payback periods. 

Military Personnel Reductions: 

Significant portions of the savings in three recommendations--combat 
service support, air defense, and aviation logistics--are related to 
military personnel reductions. These recommendations represent $217 
million, or 92 percent of the Education and Training Joint Cross-
Service Group's projected net annual recurring savings. Our analysis 
indicates that about $174 million of the net annual recurring savings 
is based on eliminating over 2,000 military positions within the Army. 
However, the Army does not plan to reduce its end strength by 2,000 in 
implementing these actions. These projected revenues do not represent 
dollar savings that can be readily reallocated to other accounts and 
applied to other priorities such as modernization, an area typically 
cited as a potential beneficiary of BRAC savings. Our analysis shows 
that without the savings from the military personnel reductions, the 
payback for the combat service support recommendation increases to 35 
years, and for both the air defense and aviation logistics 
recommendations there would be no payback. 

Extended Payback Periods: 

The group has proposed one recommendation that has no expected payback 
period and two others that have payback periods that exceed 10 years, 
far longer than the average payback typically associated with 
recommendations in the 1995 BRAC round. The recommendation to establish 
an integrated training center for the Joint Strike Fighter at Eglin Air 
Force Base, Florida, has no expected payback period, one-time cost of 
$199 million ($168 million is for military construction), and annual 
recurring cost of $3.3 million. This recommendation calls for the 
realignment of nearly 800 military positions--675 maintenance and 115 
pilot--from five military installations to Eglin Air Force Base to 
train entry-level aviators and maintenance technicians from the Navy, 
Marine Corps, and Air Force in how to operate and maintain the new 
Joint Strike Fighter aircraft when produced and deployed. According to 
the chairman of the flight training subgroup, the recommendation does 
not provide the opportunity to generate savings through the 
consolidation and alignment of similar personnel because it is a new 
mission. However, this recommendation would establish a baseline 
program in a consolidated/joint school with a curriculum that brings a 
joint perspective to the learning process. 

The two recommendations with payback periods greater than 10 years 
affect the Army. For example, the recommendation to relocate the Army 
Prime Power School from Fort Belvoir, Virginia to Fort Leonard Wood, 
Missouri, has a 16-year payback period, onetime cost of $6 million, and 
a 20-year net present value savings of less than $1 million. According 
to the DOD BRAC report, implementation of this recommendation 
consolidates engineer courses at Fort Leonard Wood, since the common-
core phase of engineer courses are already taught at Fort Leonard Wood. 
Likewise, the recommendation to realign Fort Eustis, Virginia by 
relocating the Aviation Logistics School and consolidating it with the 
Aviation Center and School at Fort Rucker, Alabama has a 13-year 
payback period, one-time cost of $492.3 million, and a 20-year net 
present value savings of only $77.4 million. According to the DOD BRAC 
report, consolidating aviation logistics training with the Aviation 
Center and School fosters consistency, standardization, and training 
proficiency. 

Proposals Eliminated from Consideration: 

The proposed recommendations do little to reduce the significant excess 
capacity (see table 20) that was identified in undergraduate pilot 
training for both fixed and rotary wing aircraft. The Education and 
Training Joint Cross-Service group identified several scenarios to 
consolidate undergraduate pilot training that could have enabled some 
base closures, but the group was unable to get the military services to 
agree to a joint solution. As a result, the Air Force made a proposal 
to realign its undergraduate pilot training and consolidate its 
navigator training with the Navy, which DOD adopted. However, the 
approved recommendation did not include rotary wing flight training. 
According to the chairman of the flight training subgroup, the capacity 
and military value analysis clearly showed that sufficient space is 
available at Fort Rucker for the Navy undergraduate rotary wing program 
to relocate from Naval Air Station Whiting Field, Florida, to Fort 
Rucker with limited renovation or military construction. However, the 
chairman noted that his group could not get the Navy to agree to the 
consolidation because of the Navy's concerns over how such actions 
would affect other training schedules, so it was not pursued. 

The Education and Training Joint Cross-Service group also developed a 
proposal to privatize graduate education that was conducted at the 
Naval Postgraduate School at Monterey, California, and the Air Force 
Institute of Technology at Wright-Patterson Air Force Base, Ohio. The 
group estimated that the proposal would produce $14 million in 20-year 
savings, with payback in 13 years, and enable the closure of the 
Monterey location. However, the IEC removed this recommendation late in 
the process because they believed that relying on the private sector to 
fulfill this requirement is too risky. According to the Navy's Special 
Assistant for BRAC, the Chief of Naval Operations did not want to lose 
the synergy and interaction between U.S. and foreign students who 
attended the postgraduate school, and there were questions over whether 
all graduate-level courses would be available at civilian institutions. 

The group also developed a recommendation to consolidate all the 
military services' senior war colleges at Fort McNair, Washington, 
D.C., making them one college of the National Defense University. The 
group estimated that the proposal would produce $213 million in 20-year 
savings, with payback in 2 years. All of the military services voiced 
concerns about this recommendation. The Air Force believed that this 
recommendation would significantly degrade its Center of Excellence for 
Professional Military Education that includes extensive curriculum for 
air centric studies located at Maxwell Air Force Base, Alabama. The 
Navy believed that the existing system already has joint educational 
forums to address executive-level interchange, and it is unclear what 
would be gained by creating a single senior war college. Finally, the 
Army opposed the recommendation because it would move senior leaders 
and their families to the National Capital Region for 10 months. Based 
on the services' concerns, the IEC rejected the proposal. However, the 
group, with the Army's concurrence, developed a recommendation to move 
the Army War College, Pennsylvania, to Fort Leavenworth, Kansas, and 
consolidate it with the Army Command and General Staff College at a 
single location. This proposal would have enabled the closure of 
Carlisle Barracks in Pennsylvania, with projected 20-year savings of 
$555 million and a 2-year payback period. However, the IEC rejected 
this proposal because it wanted to maintain the proximity to 
Washington, D.C. that provides access to key national and international 
policy makers as well as senior military and civilian leaders. 

Finally, the group developed eight scenarios to promote joint 
management of the military services' training ranges. These options 
included utilizing a joint national urban operations training center 
and establishing three joint regional range coordination centers. The 
group ultimately proposed one recommendation to establish three 
regional joint range coordination centers, which it projected would 
have a 20-year cost of $138 million and no payback. The ISG rejected 
this recommendation because it deals with a program action as opposed 
to a BRAC-related issue. 

[End of section]

Appendix VII: Headquarters and Support Activities Joint Cross-Service 
Group Selection Process and Recommendations: 

The Headquarters and Support Activities Joint Cross-Service Group 
followed the common analytical framework established by the Office of 
the Secretary of Defense (OSD) for reviewing its functions and 
facilities. The group produced 21 recommendations, each of which 
resulted in multiple closures or realignments of activities, mostly 
from leased space onto military bases intended to consolidate commands, 
reduce costs, and enhance force protection. Nine other recommendations 
were referred to other joint cross-service groups or military services 
for inclusion in their reports. The group's 21 recommendations are 
projected to realize $9.5 billion in net present value savings over 20 
years. The payback period, or length of time required for the savings 
to offset closure costs for the recommendations discussed here, varied 
widely, from immediate to up to 16 years. We have identified some 
issues that suggest uncertainty about the level of savings likely to be 
realized, which the BRAC Commission may want to consider in its 
analysis of the proposed recommendations. The DOD Inspector General and 
service audit agencies, which performed audits of the data, concluded 
that the data were sufficiently reliable for use during the BRAC 
process, but did raise issues of concern impacting some 
recommendations. 

Organization and Focus: 

The Headquarters and Support Activities Joint Cross-Service Group 
comprised six senior-level principal members, representing each 
service, the Office of the Secretary of Defense, and the Joint Chiefs 
of Staff. The group was chaired by the Army Assistant Deputy Chief of 
Staff for Programs, and principal members included the Commandant, 
Naval District Washington; the Marine Corps Assistant Deputy Commandant 
for Manpower and Reserve Affairs; the Administrative Assistant to the 
Secretary of the Air Force; the Office of the Secretary of Defense 
Deputy Director for Administration and Management; and the Chief of the 
Forces Division, Joint Staff.[Footnote 98] The group analyzed common 
headquarters-, administration-, and business-related functions across 
DOD, covering the military services, and defense agencies and 
activities. The group's objectives were to: 

* improve jointness;

* eliminate redundancy, duplication, and excess capacity;

* enhance force protection;

* utilize best business practices;

* increase effectiveness, efficiency, and interoperability; and: 

* reduce costs. 

Framework for Analysis: 

The group organized itself into three subgroups: (1) major 
administrative and headquarters activities, (2) geographic clusters and 
functional, and (3) mobilization. The major administrative and 
headquarters activities subgroup focus included headquarters activities 
in leased and DOD-owned space within and outside a 100-mile radius of 
the Pentagon, combatant, service component, and supporting commands, 
and reserve and recruiting headquarters. The geographic clusters and 
functional subgroup examined installation management within geographic 
clusters,[Footnote 99] Defense Finance and Accounting Services 
headquarters and field offices, correctional facilities, and civilian 
and military personnel centers. The mobilization subgroup looked at the 
potential for joint mobilization sites. Capacity analysis identified 
the current inventory of administrative space, while the military value 
analysis became the starting point for developing recommendations as 
they applied to the four military value selection criteria. The DOD 
Inspector General and service audit agencies performed an important 
role in ensuring the accuracy of data used in these analyses through 
extensive audits of data gathered at various locations. 

Capacity Analysis: 

To form the basis for its analyses, the group developed metrics in each 
of the functional areas to measure capacity and subsequently collected 
certified data from the military services and defense agencies and 
activities. In most cases, the group used a single metric, a standard 
factor of 200 gross square feet per person in analyzing existing 
administrative space requirements.[Footnote 100] The group also used 
fiscal year 2003 inmate population and current and maximum operational 
capacities for correctional facilities, and it used fiscal year 2004 
personnel processing numbers and peak processing capacities at military 
installations serving as reserve component mobilization sites to 
estimate mobilization excess capacity figures. 

The capacity analysis identified excess capacity across all functions 
analyzed--even when surge requirements were considered. As shown in 
table 23, excess capacity ranged from 14 percent to 87 percent across 
various capacity metrics in functional categories after applying a 
surge factor to figures for major administrative and headquarters 
installations and facilities and correctional facilities. The table 
provides the amount of the aggregate excess capacity for each of the 
functional categories; however, the amount of excess capacity varies by 
individual installation and activity. 

Table 23: Excess Capacity Identified by the Headquarters and Support 
Activities Joint Cross-Service Group: 

Figures in gross square feet. 

Subgroup: Major administrative and headquarters activities: 

Category: Installations; 
Maximum potential capacity: 112,006,087; 
Current usage: 87,566,988; 
Surge: 362,760; 
Excess capacity: 24,076,339; 
Percentage of excess capacity: 22%. 

Category: Activities; 
Maximum potential capacity: 26,576,615; 
Current usage: 20,269,800; 
Surge: 6,350; 
Excess capacity: 6,300,465; 
Percentage of excess capacity: 24%. 

Subgroup: Geographic clusters and functional: 
 
Category: Installation management; 
Maximum potential capacity: 9,381,190; 
Current usage: 8,009,278; 
Surge: 0; 
Excess capacity: 1,371,912; 
Percentage of excess capacity: 15%. 

Category: Defense Finance and Accounting Service; 
Maximum potential capacity: 3,245,808; 
Current usage: 2,530,240; 
Surge: 0; 
Excess capacity: 715,568; 
Percentage of excess capacity: 22%. 

Category: Correctional facilities; 
Maximum potential capacity: 2,975; 
Current usage: 2,141; 
Surge: 410; 
Excess capacity: 424; 
Percentage of excess capacity: 14%. 

Category: Civilian personnel centers; 
Maximum potential capacity: 1,278,040; 
Current usage: 969,000; 
Surge: 0; 
Excess capacity: 309,040; 
Percentage of excess capacity: 24%. 

Category: Military personnel centers; 
Maximum potential capacity: 2,293,495; 
Current usage: 1,748,400; 
Surge: 0; 
Excess capacity: 545,095; 
Percentage of excess capacity: 24%. 

Subgroup: Mobilization: 

Category: Mobilization/demobilization; 
Maximum potential capacity: 106,929; 
Current usage: 13,592; 
Surge: 0; 
Excess capacity: 93,337; 
Percentage of excess capacity: 87%. 

Source: Headquarters and Support Activities Joint Cross-Service Group. 

Note: Group officials noted the high percentage of excess capacity for 
mobilization is due to differences in the required maximum potential 
capacity and the different service standards for mobilizations. 

[End of table]

In calculating excess capacity estimates for each of the eight 
categories, the group analyzed the data call responses pertaining to 
current capacity, maximum potential capacity, current usage, and space 
required for surge, using a standard factor of 200 gross square feet 
per employee. Subtracting current usage and surge space requirements 
from maximum potential capacity resulted in the excess capacity 
estimates. The group used a variety of approaches to consider surge 
requirements. For example, the major administrative and headquarters 
activities subgroup determined surge requirements through specific data 
call questions and then used these requirements in the capacity 
analysis in terms of requirement and space evaluations. The 
correctional facilities function within the geographic clusters and 
functional subgroup considered surge as a function of demand against 
maximum potential capacity. At the same time, the geographic clusters 
and functional subgroup determined that military personnel centers had 
been operating in a surge mode for the past several years and did not 
require additional surge capacity to be retained. The group did not 
determine the aggregate impact its recommendations had on reducing 
excess capacity. 

Military Value Analysis: 

The group's military value analysis was directly linked to the four 
military value selection criteria, as required by the BRAC legislation. 
The group assigned military values to 25 civilian personnel offices, 10 
military personnel centers, 17 correctional facilities, 26 Defense 
Finance and Accounting Service sites, 65 installation management sites, 
334 major administrative and headquarters installations and activities, 
and 66 mobilization sites. Each functional group developed weighted 
values for each selected criteria by first asking each group member to 
assess weights across the military value selection criterion, ranking 
them from highest to lowest in importance to military value. Once the 
rankings were determined, the weights generated for each group member 
were compared and, if they were close, the weights were adopted. If 
not, the group discussed the differences and reached agreement. Table 
24 shows the various weights assigned to each of the four military 
value selection criteria. 

Table 24: Headquarters and Support Activities Joint Cross-Service Group 
Military Value Criteria Weights: 

Figures in percentages. 

Military value criteria: 1. The current and future mission capabilities 
and the impact on operational readiness of the total force of the 
Department of Defense, including impact on joint warfighting, training, 
and readiness; 
Major administrative and headquarters activities: 40%; 
Geographic clusters and functional[A]: 37%; 
Mobilization: 11%. 

Military value criteria: 2. The availability and condition of land, 
facilities, and associated airspace (including training areas suitable 
for maneuver by ground, naval, or air forces throughout a 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; 
Major administrative and headquarters activities: 44%; 
Geographic clusters and functional[A]: 20%; 
Mobilization: 7%. 

Military value criteria: 3. The ability to accommodate contingency, 
mobilization, surge, and future total force requirements at both 
existing and potential receiving locations to support operations and 
training; 
Major administrative and headquarters activities: 11%; 
Geographic clusters and functional[A]: 20%; 
Mobilization: 77%. 

Military value criteria: 4. The cost of operations and the manpower 
implications; 
Major administrative and headquarters activities: 5%; 
Geographic clusters and functional[A]: 24%; 
Mobilization: 5%. 

Total; 
Major administrative and headquarters activities: 100%; 
Geographic clusters and functional[A]: 100%[B]; 
Mobilization: 100%. 

Source: DOD and Headquarters and Support Activities Joint Cross-Service 
Group. 

[A] The geographic clusters and functional subgroup military value 
scorings are a cumulative average of its five functional areas, 
including civilian personnel, military personnel, correctional 
facilities, Defense Finance and Accounting Service, and geographic 
clusters. The system of weights provided a basis for assigning relative 
value to data collected and tabulated across each military value 
dimension. 

[B] Individual entries do not sum to total because of rounding. 

[End of table]

The group's assessment of military value included development of 
attributes (characteristics, facts, etc.), metrics or measures, and 
data call questions for each of the three subgroups. Figure 14 
demonstrates an example of how attributes, metrics, and data call 
questions were linked back to the BRAC military value selection 
criteria for the major administrative and headquarters activities 
subgroup. 

Figure 14: Selected Attributes, Metrics, and Data Questions Used to 
Assess Military Value of Major Administrative and Headquarters 
Activities: 

[See PDF for image] 

[A] The BRAC military value criteria are the first four BRAC selection 
criteria. 

[B] Military value attributes are characteristics of each criterion. 
The major administrative and headquarters activities subgroup used a 
total of 14 military value attributes. 

[C] Military value metrics are measures for the attributes. The major 
administrative and headquarters activities subgroup used a total of 20 
military value metrics. 

[D] The major administrative and headquarters activities subgroup used 
a total of 31 data call questions. 

[End of figure] 

The geographic clusters and functional subgroup and the mobilization 
subgroup used similar approaches of attributes, metrics, and data call 
questions to link the analysis back to the military value selection 
criteria. For example, the geographic clusters and functional, and 
major administive and headquarters subgroups developed metrics and data 
call questions addressing force protection issues. 

Using mostly certified data, the headquarters group examined the 
capabilities of each function from questions developed to rank 
activities from most valued to least valued. Exceptions occurred where 
military value responses were slow in arriving, contained obvious 
errors, or were incomplete, and in these cases judgment-based data were 
used. For example, in about 30 cases, activities in leased space did 
not respond to particular data call questions addressed to the leased 
space building manager nor did they identify what entity managed the 
building. After numerous follow-ups with the activities and meetings 
with representatives of the Washington Headquarters Service and Army 
Corps of Engineers--property agents for DOD--the group decided to use 
judgment-based data derived from functional subject matter experts, in 
consultation with the military departments and defense agencies. In an 
October 2004 memorandum to the Infrastructure Steering Group describing 
military value scoring plan changes, the Headquarters and Support 
Activities Joint Cross-Service Group concluded that based on an 
analysis of the effect of the missing, wrong, and incomplete data on 
proposals, there were some data issues that could affect the generation 
and comparison of proposals by the group members. However, improvements 
to the data occurred over time, and as of May 2005, when the military 
value analysis was completed, the group reported that a vast majority 
of its data were certified. We were told by a group operations research 
analyst that 99 percent of the analysis was determined by certified 
data and less than 1 percent by judgment-based data. 

DOD Inspector General's and Service Audit Agencies' Role in the 
Process: 

The DOD Inspector General and service audit agencies reviewed the data 
and processes used by each subgroup to develop their recommendations; 
the military service audit agencies reviewed data inputs from the 
services, and the Inspector General reviewed data inputs from defense 
agencies and activities. Their objectives were to validate the data and 
the adequacy of the supporting documentation. The process for detecting 
and correcting data errors was quite lengthy and challenging. Through 
their audits of the data collected from field activities during the 
process, audit agencies notified the group as data discrepancies were 
discovered so that follow-on corrective actions could be initiated. The 
military service audit agencies concluded that the information was 
sufficiently reliable for its intended purpose. Assessments by the DOD 
Inspector General's office of the data it reviewed were more mixed. In 
its June 10, 2005 draft report on the Headquarters and Support 
Activities Joint Cross-Service Group's data integrity and internal 
control process for BRAC,[Footnote 101] the DOD Inspector General's 
office concluded that after corrections were made, the group generally 
used certified data and created an adequate audit trail for its 
capacity, military value, and cost of base realignment actions. 
However, the Inspector General's office raised issues involving 
estimated one-time savings associated with vacating leased space and 
consistency in rounding to estimate personnel savings. According to 
group officials, the Inspector General's issues were discussed with 
group leadership, and they decided in deliberative session that the 
approaches taken by the group were the most fair and accurate 
approaches available and should be retained. 

Our analysis indicates that the two issues identified by the Inspector 
General would reduce projected savings. Our analysis shows that if the 
one-time cost savings associated with antiterrorism and force 
protection are excluded, the 20-year net present value savings would be 
reduced by $268.4 million, the payback periods for 7 of the 15 affected 
recommendations would be extended by 1 year, and 3 years for one 
recommendation. Also, for the two recommendations[Footnote 102] 
identified by the Inspector General as using abnormal rounding 
techniques[Footnote 103] to estimate personnel reductions, the 
projected 20-year net present value savings in one case would be 
reduced from $13.5 million to a $749,000 cost, and for the other 
recommendation, the 20-year net present value savings drops from 
approximately $4.9 million to $2.6 million. 

Identification and Assessment of Alternate Proposals and Selection of 
Recommendations: 

The Headquarters and Support Activities Joint Cross-Service Group 
developed proposals without receiving all the data they had requested 
from numerous activities. As such, the group relied on transformational 
goals and military judgment to develop its initial proposals. The group 
also used certified data to support or reject its proposals, data which 
the DOD Inspector General audited for accuracy. The group used the 
optimization model on a limited basis for a few functional areas 
because potential for those functional realignment possibilities was 
generally slight. 

The following transformation options helped guide the group in 
developing initial proposals: 

* Consolidate management at installations with shared boundaries and in 
geographic clusters. 

* Consolidate or co-locate civilian and military personnel offices. 

* Consolidate Defense Finance and Accounting Service central and field 
offices. 

* Establish and consolidate mobilization sites and establish joint 
deployment processing sites. 

* Justify locations for headquarters, commands, and activities within 
100 miles of the Pentagon. 

* Eliminate leased space. 

* Consolidate multi-location headquarters at single locations, and 
eliminate stand-alone headquarters. 

* Consolidate corrections facilities. 

* Co-locate reserve and active component recruiting headquarters, and 
eliminate reserve force management organizations. 

* Regionalize common headquarters, administrative, and business-related 
common support activities. 

The group initially developed 117 proposals, based on these 
transformational options and military judgment, to include alternative 
proposals being requested by the Infrastructure Steering Group (ISG). 
The group settled on 50 recommendations that were initially forwarded 
to the ISG. Seventeen of them were subsequently consolidated with other 
recommendations; 2 were rejected by the ISG and one by the 
Infrastructure Executive Council. Also, 9 recommendations were 
transferred to other cross-service groups or military departments for 
inclusion in their reports.[Footnote 104] That left 21 recommendations 
that the group addressed in its report and accordingly are addressed in 
this appendix. 

Recommendations Approved by DOD: 

The Headquarters and Support Activities Joint Cross-Service Group 
projects that its 21 recommendations will produce a 20-year net present 
value savings of $9.5 billion, net annual recurring savings of about 
$914 million, and payback, or length of time required for the savings 
to offset closure costs for the recommendations, that varies widely 
from immediate to up to 16 years. Table 25 provides a summary of the 
financial aspects of the group's recommendations. 

Table 25: Financial Aspects of the Headquarters and Support Activities 
Joint Cross-Service Group's Recommendations: 

Fiscal year 2005 constant dollars in millions. 

Recommended action: Joint basing; 
DOD report page: H&SA-41; 
One-time (costs): ($50.6); 
Net implementation (costs) savings[A]: $601.3; 
Net annual recurring savings: $183.8; 
Payback period: immediate; 
20-year net present value savings[B]: $2,342.5. 

Recommended action: Consolidate/co-locate active and reserve personnel 
and recruiting centers for Army and Air Force; 
DOD report page: H&SA-33; 
One-time (costs): ($119.3); 
Net implementation (costs) savings[A]: $463.0; 
Net annual recurring savings: $152.8; 
Payback period: immediate; 
20-year net present value savings[B]: $1,913.4. 

Recommended action: Defense Finance and Accounting Service; 
DOD report page: H&SA-37; 
One-time (costs): ($282.1); 
Net implementation (costs) savings[A]: $158.1; 
Net annual recurring savings: $120.5; 
Payback period: immediate; 
20-year net present value savings[B]: $1,313.8. 

Recommended action: Consolidate transportation command components; 
DOD report page: H&SA-31; 
One-time (costs): ($101.8); 
Net implementation (costs) savings[A]: $339.3; 
Net annual recurring savings: $99.3; 
Payback period: immediate; 
20-year net present value savings[B]: $1,278.2. 

Recommended action: Consolidate Defense Information Systems Agency; 
DOD report page: H&SA-27; 
One-time (costs): ($220.0); 
Net implementation (costs) savings[A]: ($102.1); 
Net annual recurring savings: $59.4; 
Payback period: 2 years; 
20-year net present value savings[B]: $491.2. 

Recommended action: Co-locate Missile and Space Defense agencies; 
DOD report page: H&SA-15; 
One-time (costs): ($178.2); 
Net implementation (costs) savings[A]: $13.0; 
Net annual recurring savings: $36.1; 
Payback period: 1 year; 
20-year net present value savings[B]: $359.1. 

Recommended action: Co-locate miscellaneous Army leased locations; 
DOD report page: H&SA-10; 
One-time (costs): ($44.1); 
Net implementation (costs) savings[A]: $59.5; 
Net annual recurring savings: $27.8; 
Payback period: 1 year; 
20-year net present value savings[B]: $322.0. 

Recommended action: Co-locate miscellaneous Air Force leased locations 
and National Guard Headquarters leased locations; 
DOD report page: H&SA-3; 
One-time (costs): ($90.5); 
Net implementation (costs) savings[A]: ($10.8); 
Net annual recurring savings: $30.8; 
Payback period: 1 year; 
20-year net present value savings[B]: $308.3. 

Recommended action: Co-locate miscellaneous OSD, defense agency, and 
field activity leased locations; 
DOD report page: H&SA-12; 
One-time (costs): ($539.0); 
Net implementation (costs) savings[A]: ($376.9); 
Net annual recurring savings: $63.3; 
Payback period: 9 years; 
20-year net present value savings[B]: $257.6. 

Recommended action: Consolidate civilian personnel offices within 
military department and defense agencies; 
DOD report page: H&SA-19; 
One-time (costs): ($97.5); 
Net implementation (costs) savings[A]: ($46.4); 
Net annual recurring savings: $24.4; 
Payback period: 4 years; 
20-year net present value savings[B]: $196.7. 

Recommended action: Co-locate military department investigation 
agencies with DOD Counterintelligence and Security Agency; 
DOD report page: H&SA-8; 
One-time (costs): ($174.0); 
Net implementation (costs) savings[A]: ($88.0); 
Net annual recurring savings: $26.3; 
Payback period: 7 years; 
20-year net present value savings[B]: $172.7. 

Recommended action: Relocate miscellaneous Department of the Navy 
leased locations; 
DOD report page: H&SA-49; 
One-time (costs): ($61.9); 
Net implementation (costs) savings[A]: ($12.8); 
Net annual recurring savings: $18.0; 
Payback period: 1 year; 
20-year net present value savings[B]: $164.0. 

Recommended action: Consolidate Army Test and Evaluation Command 
Headquarters; 
DOD report page: H&SA-18; 
One-time (costs): ($7.1); 
Net implementation (costs) savings[A]: $44.0; 
Net annual recurring savings: $8.7; 
Payback period: immediate; 
20-year net present value savings[B]: $125.7. 

Recommended action: Relocate Army headquarters and field operating 
activities; 
DOD report page: H&SA-46; 
One-time (costs): ($199.9); 
Net implementation (costs) savings[A]: ($111.8); 
Net annual recurring savings: $23.9; 
Payback period: 10 years; 
20-year net present value savings[B]: $122.9. 

Recommended action: Consolidate media organizations into new agency for 
media and publications; 
DOD report page: H&SA-30; 
One-time (costs): ($42.0); 
Net implementation (costs) savings[A]: ($2.9); 
Net annual recurring savings: $9.5; 
Payback period: 4 years; 
20-year net present value savings[B]: $89.0. 

Recommended action: Create joint mobilization sites; 
DOD report page: H&SA-35; 
One-time (costs): ($0.1); 
Net implementation (costs) savings[A]: $30.9; 
Net annual recurring savings: $0.8; 
Payback period: immediate; 
20-year net present value savings[B]: $37.9. 

Recommended action: Co-locate Navy Education and Training Command and 
Navy Education and Training Professional Development and Technology 
Center; 
DOD report page: H&SA-17; 
One-time (costs): ($33.3); 
Net implementation (costs) savings[A]: ($23.6); 
Net annual recurring savings: $3.7; 
Payback period: 10 years; 
20-year net present value savings[B]: $14.4. 

Recommended action: Co-locate defense and military department 
adjudication activities; 
DOD report page: H&SA-5; 
One-time (costs): ($67.1); 
Net implementation (costs) savings[A]: ($47.5); 
Net annual recurring savings: $5.7; 
Payback period: 13 years; 
20-year net present value savings[B]: $11.3. 

Recommended action: Relocate Air Force Real Property Agency; 
DOD report page: H&SA-44; 
One-time (costs): ($4.5); 
Net implementation (costs) savings[A]: ($0.9); 
Net annual recurring savings: $0.9; 
Payback period: 5 years; 
20-year net present value savings[B]: $7.9. 

Recommended action: Consolidate Defense Commissary Agency Eastern and 
Midwestern Regions, and Hopewell, VA, offices; 
DOD report page: H&SA-26; 
One-time (costs): ($47.2); 
Net implementation (costs) savings[A]: ($35.4); 
Net annual recurring savings: $3.9; 
Payback period: 14 years; 
20-year net present value savings[B]: $4.9. 

Recommended action: Consolidate correctional facilities into joint 
regional correctional facilities; 
DOD report page: H&SA-22; 
One-time (costs): ($178.8); 
Net implementation (costs) savings[A]: ($149.4); 
Net annual recurring savings: $14.6; 
Payback period: 16 years; 
20-year net present value savings[B]: $2.3. 

Total; 
One-time (costs): ($2,539.0); 
Net implementation (costs) savings[A]: $700.6; 
Net annual recurring savings: $914.2; 
20-year net present value savings[B]: $9,535.8. 

Source: GAO analysis of DOD data. 

Note: After DOD released its BRAC recommendations on May 13, 2005, the 
Headquarters and Support Activities Joint Cross-Service Group 
discovered errors in cost and savings data for 6 of its 21 
recommendations. At the time of this report, the impact resulting from 
these recommendations increased the 20-year net present value savings 
by $34.6 million. For 3 of the recommendations, 20-year net present 
value savings increased, while the remaining 3 decreased. The issue was 
still in the process of being corrected at the time of this report. 

[A] This represents net costs or savings within the 6-year 
implementation period required to implement BRAC recommendations. 

[B] DOD used a 2.8 percent discount rate to calculate net present 
value. 

[End of table]

In total, the group estimates that its recommendations will require a 
total investment of $2.5 billion, primarily for new military 
construction and moving personnel from leased space onto military 
bases, and will ultimately result in net annual recurring savings of 
$914.2 million. Our analysis indicates that about 92 percent of the 
annual recurring savings results from reductions in military and 
civilian employment levels (about $270 million, and about $267 million 
respectively) and the elimination of future lease payments for 
administrative office space ($300 million). Eighteen of the group's 
recommendations are expected to realize savings within 10 years of 
completing the BRAC realignment and closure actions, while 3 have a 
payback period greater than 10 years. 

Issues Identified with Approved Recommendations: 

Time did not permit us to assess the operational impact of each 
recommendation, particularly where operations are proposed for 
consolidation across multiple locations outside a single geographic 
area. However, we offer a number of broad-based observations about the 
proposed recommendations. While available data supporting the 
recommendations suggest that their implementation should provide for 
more efficient operations within DOD, the BRAC Commission may wish to 
consider the basis of the group's assumptions for personnel reductions 
because they have a significant impact on the recommendations' savings; 
the assumptions regarding vacating leased facilities because including 
antiterrorism and force protection savings also has an impact on the 
recommendations' savings; challenges to implementing joint basing; 
cases where realignment actions with long payback periods were combined 
with actions with shorter durations; stand-alone actions where the 
payback period exceeded 10 years; and proposals eliminated prior to 
release of the final recommendations. 

Personnel Reductions: 

Approximately $537 million, or about 59 percent, of the group's 
projected net annual recurring savings are based on reductions in the 
number of military and civilian personnel eliminated as a result of the 
BRAC actions.[Footnote 105] The process used raises questions about the 
projected savings. The group initially used generic savings factors to 
estimate the number of personnel positions that could be eliminated 
when organizations were co-located or consolidated. These factors were 
developed on the basis of comments from subject matter experts and 
research of various databases available through the Pentagon library or 
the Internet. The group found that personnel reductions from 14 percent 
to 30 percent resulted from consolidation of organizations and 7 
percent to 15 percent when they were co-located. The group adopted 
these personnel savings factors because the information it did collect 
on the number of personnel performing common support functions within 
the affected organizations could not be used and believed it did not 
have sufficient time to perform more precise manpower studies. The 
group used these savings factors consistently as starting points in 
negotiating the number of personnel reductions with the military 
departments and defense agencies and activities. In most cases the 
negotiated estimates were accepted, but in some cases the group imposed 
a personnel reduction percentage when negotiations failed. For example, 
in analyzing the costs and savings associated with relocating the Army 
Matériel Command from temporary lease space on Fort Belvoir, Virginia, 
to Redstone Arsenal, Alabama, the group leadership decided to impose a 
7 percent personnel elimination based on expected economies of scale 
from co-locating the command with one of its major subordinate 
activities. Our analysis showed that the percentage factor used to 
estimate personnel reductions for all recommendations ranged from zero 
percent to about 42 percent. 

A separate area of concern involves savings reported for military 
personnel. Our analysis indicates that the group's recommendations 
propose to eliminate 2,479 military positions, which would result in 
about $270 million in net annual recurring savings. However, service 
officials indicate that they do not plan to reduce their end-strength 
based on these proposed eliminations but rather reallocate these 
positions elsewhere within the force structure. Since these military 
personnel will be assigned elsewhere rather than removed from the force 
structure, the projected savings do not represent dollars that can be 
readily allocated outside the personnel accounts to other purposes. 

Leased Space: 

Fifteen of the group's recommendations include a one-time savings of 
over $300 million from moving activities from leased space onto 
military installations. For example, these recommendations, if 
approved, would reduce total DOD leased space within the National 
Capital Region[Footnote 106] from 8.3 million square feet to about 1.7 
million square feet, or by 80 percent. While our prior work generally 
supports the premise that leased property is more expensive than 
government owned property, the recommendations related to vacating 
leased space also raises questions about a limitation in projected 
savings and impact on local communities. 

The one-time cost savings represents costs expected to be avoided in 
the future by moving from leased facilities onto government owned and 
protected facilities rather than upgrading existing leased space to 
meet DOD's antiterrorism and force protection standards.[Footnote 107] 
According to a DOD official, the department put together a task force 
after the June 1996 Khobar Tower bombing incident in Dhahran, Saudi 
Arabia, of mostly engineers to develop minimum force protection 
standards for all DOD-occupied locations. The official also stated that 
application of the standards in BRAC was not the result of a threat or 
vulnerability assessment of the affected facilities. The Pentagon Force 
Protection Agency will shortly begin a 10-month antiterrorism and force 
protection vulnerability assessment of about 60 DOD-occupied leased 
buildings in the National Capital Region. This assessment will provide 
DOD with information to estimate the costs and feasibility of upgrading 
leased facilities to the antiterrorism and force protection standards. 
The force protection standards for leased buildings apply only where 
DOD personnel occupy at least 25 percent of the net interior usable 
area; only to the portion of the building occupied by DOD personnel; 
and to all new leases executed on or after October 1, 2005, and to 
leases renewed or extended on or after October 1, 2009. Initially, the 
group prepared military value data call questions that could determine 
whether a leased location met the force protection requirements. 
However, group officials stated that most of these questions were 
discarded because of inconsistencies in how the questions were answered 
except for the percentage of DOD personnel occupying buildings. 

The group applied the cost avoidance factor consistently to all leased 
locations but did not collect data that would indicate whether existing 
leases met the standards, which could possibly result in application of 
the factor at locations meeting the force protection requirements. For 
example, the group applied over $2 million in one-time force protection 
cost avoidance to relocate a Navy human resources service center from 
the Stennis Space Center, Mississippi, to the Naval Support Activity, 
Pennsylvania, even though the Stennis Space Center may be as secure as 
any military installation. If these one-time savings, as shown in the 
final recommendations forwarded to the BRAC Commission, are not 
considered in the cost and savings analysis, our analysis shows that 
the projected 20-year net present value savings decrease by 3 percent 
($268.4 million), the payback period increases by 1 year for 7 of 15 
recommendations, and by 3 years for one recommendation as shown in 
table 26. After the final recommendations were released to the BRAC 
Commission, the group found errors in some recommendations, affecting 
one-time estimated savings and other costs and savings, which were 
still in the process of being corrected at the time of this report. 

Table 26: Impact of One-time Antiterrorism and Force Protection Savings 
on Recommendations Involving Leased Space: 

Fiscal year 2005 constant dollars in millions. 

Recommended action: Consolidate transportation command components; 
DOD proposed recommendation: 20-year net present value savings: 
$1,278.2; 
DOD proposed recommendation: Payback period: immediate; 
GAO analysis without antiterrorism and force protection savings: 20-
year net present value savings: $1,273.4; 
GAO analysis without antiterrorism and force protection savings: 
Payback period: immediate. 

Recommended action: Consolidate/co-locate active and reserve personnel 
and recruiting centers for Army and Air Force; 
DOD proposed recommendation: 20-year net present value savings: 
$1,909.0[A]; 
DOD proposed recommendation: Payback period: immediate; 
GAO analysis without antiterrorism and force protection savings: 20-
year net present value savings: $1,880.7; 
GAO analysis without antiterrorism and force protection savings: 
Payback period: immediate. 

Recommended action: Consolidate Army Test and Evaluation Command 
Headquarters; 
DOD proposed recommendation: 20-year net present value savings: $125.7; 
DOD proposed recommendation: Payback period: immediate; 
GAO analysis without antiterrorism and force protection savings: 20-
year net present value savings: $122.8; 
GAO analysis without antiterrorism and force protection savings: 
Payback period: immediate. 

Recommended action: Co-locate Missile and Space Defense agencies; 
DOD proposed recommendation: 20-year net present value savings: $359.1; 
DOD proposed recommendation: Payback period: 1 year; 
GAO analysis without antiterrorism and force protection savings: 20-
year net present value savings: $282.6; 
GAO analysis without antiterrorism and force protection savings: 
Payback period: 4 years. 

Recommended action: Co-locate miscellaneous Army leased locations; 
DOD proposed recommendation: 20-year net present value savings: $322.0; 
DOD proposed recommendation: Payback period: 1 year; 
GAO analysis without antiterrorism and force protection savings: 20-
year net present value savings: $300.3; 
GAO analysis without antiterrorism and force protection savings: 
Payback period: 2 years. 

Recommended action: Co-locate miscellaneous Air Force leased locations 
and National Guard Headquarters leased locations; 
DOD proposed recommendation: 20-year net present value savings: 
$308.2[A]; 
DOD proposed recommendation: Payback period: 1 year; 
GAO analysis without antiterrorism and force protection savings: 20-
year net present value savings: $294.7; 
GAO analysis without antiterrorism and force protection savings: 
Payback period: 2 years. 

Recommended action: Relocate miscellaneous Department of the Navy 
leased locations; 
DOD proposed recommendation: 20-year net present value savings: $164.0; 
DOD proposed recommendation: Payback period: 1 year; 
GAO analysis without antiterrorism and force protection savings: 20-
year net present value savings: $151.2; 
GAO analysis without antiterrorism and force protection savings: 
Payback period: 2 years. 

Recommended action: Co-locate military department investigation 
agencies with DOD Counterintelligence and Security Agency; 
DOD proposed recommendation: 20-year net present value savings: $172.7; 
DOD proposed recommendation: Payback period: 7 years; 
GAO analysis without antiterrorism and force protection savings: 20-
year net present value savings: $161.6; 
GAO analysis without antiterrorism and force protection savings: 
Payback period: 7 years. 

Recommended action: Consolidate Defense Information Systems Agency; 
DOD proposed recommendation: 20-year net present value savings: $491.2; 
DOD proposed recommendation: Payback period: 2 years; 
GAO analysis without antiterrorism and force protection savings: 20-
year net present value savings: $475.1; 
GAO analysis without antiterrorism and force protection savings: 
Payback period: 3 years. 

Recommended action: Consolidate civilian personnel offices within 
military department and defense agencies; 
DOD proposed recommendation: 20-year net present value savings: $196.7; 
DOD proposed recommendation: Payback period: 4 years; 
GAO analysis without antiterrorism and force protection savings: 20-
year net present value savings: $189.6; 
GAO analysis without antiterrorism and force protection savings: 
Payback period: 4 years. 

Recommended action: Consolidate media organizations into new agency for 
media and publications; 
DOD proposed recommendation: 20-year net present value savings: $89.0; 
DOD proposed recommendation: Payback period: 4 years; 
GAO analysis without antiterrorism and force protection savings: 20-
year net present value savings: $86.5; 
GAO analysis without antiterrorism and force protection savings: 
Payback period: 4 years. 

Recommended action: Co-locate miscellaneous OSD, defense agency, and 
field activity leased locations; 
DOD proposed recommendation: 20-year net present value savings: $257.6; 
DOD proposed recommendation: Payback period: 9 years; 
GAO analysis without antiterrorism and force protection savings: 20-
year net present value savings: $200.1; 
GAO analysis without antiterrorism and force protection savings: 
Payback period: 10 years. 

Recommended action: Relocate Army headquarters and field operating 
activities; 
DOD proposed recommendation: 20-year net present value savings: $122.9; 
DOD proposed recommendation: Payback period: 10 years; 
GAO analysis without antiterrorism and force protection savings: 20-
year net present value savings: $115.4; 
GAO analysis without antiterrorism and force protection savings: 
Payback period: 10 years. 

Recommended action: Consolidate Defense Commissary Agency Eastern and 
Midwestern Regions, and Hopewell, VA, offices; 
DOD proposed recommendation: 20-year net present value savings: $4.9; 
DOD proposed recommendation: Payback period: 14 years; 
GAO analysis without antiterrorism and force protection savings: 20-
year net present value savings: $2.3; 
GAO analysis without antiterrorism and force protection savings: 
Payback period: 15 years. 

Recommended action: Co-locate defense/military department adjudication 
activities; 
DOD proposed recommendation: 20-year net present value savings: 
$13.5[A]; 
DOD proposed recommendation: Payback period: 13 years; 
GAO analysis without antiterrorism and force protection savings: 20-
year net present value savings: $10.0; 
GAO analysis without antiterrorism and force protection savings: 
Payback period: 14 years. 

Total; 
DOD proposed recommendation: 20-year net present value savings: 
$5,814.7; 
GAO analysis without antiterrorism and force protection savings: 20-
year net present value savings: $5,546.3. 

Difference; 
GAO analysis without antiterrorism and force protection savings: 20-
year net present value savings: $268.4. 

Source: GAO analysis of DOD data. 

[A] The 20-year net present value savings for these proposed 
recommendations differ from the amount in the final BRAC report because 
of errors found in the COBRA reports after release of the final BRAC 
report. 

[End of table]

Furthermore, four of the Headquarters and Support Activities Joint 
Cross-Service Group's recommendations involve moving personnel from 
leased space to Fort Belvoir, Virginia, mostly at the engineering 
proving ground, increasing Fort Belvoir's population by about 
10,700.[Footnote 108] The recommendations include military construction 
projects to build facilities for these personnel on Fort Belvoir. In 
addition, the recommendations include a $55 million Army estimate to 
improve roads and other infrastructure in the area surrounding the 
fort. However, it is uncertain at this time whether this will be 
sufficient to fully support the impact on the surrounding community's 
infrastructure, or the likelihood that federal assistance is likely to 
be sought by local governments to help communities reduce the impact--
costs that will have the effect of increasing one-time costs and 
offsetting short-term savings from the recommendations. 

Implementation Challenges: 

While the proposal to create joint bases by consolidating common 
installation management functions is projected to create greater 
efficiencies, our prior work suggests that implementation of these 
actions may prove challenging. The joint-basing recommendation involves 
one service being responsible for various installation management 
support functions[Footnote 109] at bases that share a common boundary 
or are in proximity to one another. For example, the Army would be the 
executive agent for Fort Lewis, Washington, and McChord Air Force Base, 
Washington, combined as Joint Base Lewis-McChord. However, as evident 
from our recent visit to both installations and discussions with base 
officials, concerns over obstacles such as seeking efficiencies at the 
expense of the mission, could jeopardize a smooth and successful 
implementation of the recommendation. Further, Air Force officials 
stated that most military personnel at McChord are mission critical and 
deployable, increasing the difficulty to identify possible Air Force 
military personnel reductions. The group projects 20-year net present 
value savings of about $2.3 billion, with net annual recurring savings 
of about $184 million. More than 90 percent of the recurring savings 
reported represent military (54 percent) and civilian (37 percent) 
personnel reductions. The group applied personnel reductions ranging 
from 1 to 10 percent for each of the 12 locations included in the joint 
basing recommendation. The actual percentage used for each location was 
negotiated between the group and the military departments based on the 
size of base populations and the kind of services provided. 

In our June 2005 report[Footnote 110] we noted that DOD and the 
military services' ability to forecast base operations support 
requirements and funding needs has been hindered by the lack of a 
common terminology for defining base support functions, as well as by 
the lack of a mature analytic process for developing base support 
requirements. We also reported challenges in maintaining adequate 
funding to meet base operating support requirements and facility 
upkeep. We concluded that until such problems are resolved, DOD will 
not have in place the management and oversight framework needed for 
identifying total base support requirements and ensuring adequate 
delivery of services, particularly in a joint environment. In its 
comments to a draft of our June report, DOD indicated that it expects 
to release a new facilities operation model by December 1, 2005, and 
use it to develop the fiscal year 2008 program and budget. DOD stated 
that it is also conducting a cross-department initiative to develop 
definitions for the common delivery of installation services and 
expects to complete this effort by December 2005. However, regarding 
modeling efforts, a Senior Joint Basing Group[Footnote 111] official 
expressed doubt during our review whether there would be a single 
funding model because base operating support, as it currently exists, 
has too many diverse activities to model. He indicated that it is more 
likely that a suite of tools will evolve over time. 

Bundling Lessens Visibility of Costs: 

The headquarters group consolidated some recommendations with more than 
10-year payback periods, far longer than typical payback periods in the 
1995 BRAC round, with other proposals having shorter returns on 
investment. In total, 8 of the 21 final recommendations were actually 
packages that consolidated two or more recommendations approved by the 
joint cross-service group as stand-alone candidate recommendations. We 
found that in 7 instances, the more than 10-year payback periods of 
initially stand-alone proposals tended to be masked after they were 
combined in such packages. For example, the group developed a proposal 
to move the Army Matériel Command from Fort Belvoir, Virginia, to 
Redstone Arsenal, Alabama, which showed a 20-year net present cost and 
a 100-year payback period by not having to spend about $71 million to 
construct a permanent facility for the headquarters at Fort Belvoir. 
Had the construction savings been included in the recommendation, the 
payback period would have been 32 years. Concurrently, the group 
developed a separate proposal to relocate various Army offices from 
leased and government-owned office space mostly onto Fort Sam Houston, 
Texas, which would result in a 20-year net present value savings of 
about $277.4 million and a 3-year payback period. The group decided to 
combine these two stand-alone proposals so that all Army headquarters 
related activities were addressed in one recommendation with an 
estimated 20-year net present value savings of about $123 million with 
a 10-year payback. 

Extended Payback Periods: 

The group proposed three recommendations that have an estimated payback 
period exceeding 10 years and one-time costs for implementation that 
greatly exceeds the expected 20-year net present value savings. The 
cost, savings, and expected benefits for these recommendations are 
described below: 

* The recommendation to co-locate military department and DOD security 
clearance adjudication and appeals activities to Fort Meade, Maryland, 
has an estimated payback of 13 years, one-time cost exceeding $67 
million, and 20-year net present value savings of only $11.3 million. 
According to the DOD final BRAC report, implementation of this 
recommendation would co-locate adjudication activities, reduce lease 
costs, and enhance security. 

* The recommendation to consolidate the Defense Commissary Agency 
Eastern and Midwestern regions and a leased site in Hopewell, Virginia, 
to Fort Lee, Virginia, has an estimated 14-year payback period, one-
time cost exceeding $47 million, and 20-year net present value savings 
of only $4.9 million. According to the DOD BRAC report, implementation 
of this recommendation would consolidate headquarters operations at 
single locations, enhance security, and reduce lease costs. 

* The recommendation to establish joint regional correctional 
facilities has an estimated 16-year payback period, one-time cost of 
almost $179 million, and 20-year net present value savings of only $2.3 
million. For example, the recommendation would establish the Midwest 
Joint Regional Correctional Facility by relocating correctional 
functions currently located at Lackland Air Force Base, Texas; Fort 
Knox, Kentucky; and Fort Sill, Oklahoma, to Fort Leavenworth, Kansas. 
According to the DOD BRAC report, implementation of this recommendation 
would improve jointness, centralize corrections training, and eliminate 
or significantly reduce old inefficient facilities. 

Proposals Eliminated from Consideration: 

Three recommendations were initially approved by the group; two were 
later rejected by the ISG and another by the IEC. The ISG rejected the 
recommendation to relocate U.S. Southern Command, Miami, Florida, from 
its leased space to a state-owned leased space also in Miami with no 
explanation. Group officials stated the ISG rejected the U.S. Southern 
Command recommendation because costs associated with the relocation 
were too high. The ISG also rejected the relocation of U.S. Army 
Pacific Headquarters from Fort Shafter, Hawaii, to Pearl Harbor, 
Hawaii, because of Pacific Command Combatant Commander and the Army 
concerns regarding future requirements of U.S. Army Pacific 
Headquarters. The recommendation rejected by the IEC to co-locate 
military department and DOD medical activities to the National Medical 
Center, Bethesda, Maryland was discarded because of cost and long 
payback issues. 

In other cases, Headquarters and Support Activities Joint Cross-Service 
Group members considered proposals that could have fostered jointly 
operated support activities, but they were later dropped on the basis 
of cost considerations and perceived operational risks. For example, 
the group considered co-locating all military personnel offices at one 
location. However, in analyzing this proposal, the group determined 
that implementing the joint proposal would be very costly, while also 
citing concerns about the uncertain availability of skilled employees 
at a single location to operate the joint facility. Therefore, the 
group concluded that it was better to co-locate or consolidate 
personnel centers within the individual military departments. 
Similarly, for civilian personnel centers the group developed a 
proposal to consolidate 25 offices that are currently operated by the 
military departments and defense agencies into 10 DOD "joint" offices. 
However, the proposal was dropped after concerns were raised by one 
military department that the risks associated with implementing joint 
personnel offices concurrently with processing paperwork supporting 
other BRAC-related personnel moves and implementing a new standardized 
personnel data system were too high. Consequently, the IEC directed the 
group to revise its proposal. The group revised its proposal to provide 
for consolidating the 25 current offices into 12 offices--4 to be 
operated by the Army, 4 by the Navy, 1 by the Air Force, and 3 by a 
single agency providing support to the defense agencies. While DOD did 
not recommend the creation of joint military personnel offices or joint 
civilian personnel offices, it is important to note that each of the 
initial proposals included justifications citing ongoing efforts within 
the department to establish standardized personnel processes and 
systems. 

The recommendation to co-locate components of the U.S. Transportation 
Command[Footnote 112] does not include the Navy Military Sealift 
Command, one of the service component organizations. The group 
developed a proposal to move the Army and Navy component of the 
Transportation Command to Scott Air Force Base, Illinois. While the 
Army agreed to the proposal, the Navy did not believe that the group 
should be proposing to move the Military Sealift Command because it was 
considered an operational headquarters and not an administrative 
function under the purview of the Headquarters and Support Activities 
Joint Cross-Service Group. The ISG agreed with the Navy and deleted the 
Military Sealift Command from the recommendation, which reduced 
projected 20-year net present value savings from $1.30 billion to $1.28 
billion. 

[End of section]

Appendix VIII: Industrial Joint Cross-Service Group Selection Process 
and Recommendations: 

The Industrial Joint Cross-Service Group followed the common analytical 
framework established by the Office of the Secretary of Defense (OSD) 
for completing its review. The group initially produced 34 candidate 
recommendations; 3 were disapproved by the Infrastructure Executive 
Council (IEC); and several were subsequently integrated into larger 
military service recommendations. As a result, the group had 17 
remaining recommendations that are addressed in this appendix. These 17 
recommendations represent a mixture of closures and realignments with 
the realignments often encompassing the consolidation of various types 
of industrial workloads at fewer locations. Although some of the 
recommendations may be considered transformational, limited progress 
was made in recommending major actions to foster greater interservicing 
among the services. Industrial group officials said this was due to 
economic and military value considerations as well as the downsizing of 
maintenance facilities in prior BRAC rounds. Altogether, DOD projects 
these recommendations to produce about $7.6 billion in net present 
value savings over a 20-year period; nearly all are projected to have 
short payback periods (time required to recoup up-front investment 
costs) with expected savings offsetting expected implementation costs 
either immediately or within a few years. One recommendation has a 
payback period exceeding 10 years. However, uncertainty exists about 
the precision of the savings estimates because many estimates are based 
on efficiency gains that are yet to be validated and other factors. 
Further scrutiny by the BRAC Commission of this and other 
recommendations may be warranted to assess the impact of reductions 
against future force structure needs or capacity constraints. The DOD 
Inspector General and the military service audit agencies, which 
performed audits of the data, concluded that the data were sufficiently 
reliable for use during the BRAC process. 

Organization and Focus: 

The industrial group was composed of senior-level principal members 
from the installations directorates for each service, the Defense 
Logistics Agency (DLA), and the Joint Chiefs of Staff and was supported 
by staff from these organizations. The Under Secretary of Defense 
(Acquisition, Technology and Logistics) chaired the group, which in 
turn forwarded its proposed recommendations to the Infrastructure 
Steering Group (ISG) for its review and approval.[Footnote 113] The 
group organized its BRAC analyses around three subgroups: (1) 
maintenance, (2) ship overhaul and repair, and (3) munitions and 
armaments. All of the subgroups focused their work similarly on 
identifying opportunities for reducing excess capacity. 

Framework for Analysis: 

The industrial group's analytical process included a review of nine 
distinct industrial areas across each of the military services. They 
included: (1) ground vehicles, aircraft, and other depot maintenance; 
(2) ground vehicles, aircraft, and other intermediate maintenance; (3) 
ship depot maintenance; (4) ship intermediate maintenance; (5) 
munitions production; (6) munitions storage; (7) munitions 
demilitarization; (8) munitions maintenance; and (9) armaments 
production. As per the BRAC process outlined by OSD, capacity analysis 
and military value analysis provided the starting point for the cross-
service group's work. The DOD Inspector General and service audit 
agencies performed an important role in ensuring the accuracy of data 
used in these analyses through extensive audits of data gathered at 
various locations. 

Capacity Analysis: 

To form the basis for its analysis, the group developed metrics in each 
of the nine industrial areas to measure current capacity and 
subsequently collected certified data linked to these metrics from 
various defense activities across the country whose missions resided 
within these categories. While the most predominate metric was direct 
labor hours--used by both the maintenance and ship overhaul and repair 
subgroups exclusively and by the munitions and armaments subgroup in 
some instances--the munitions and armaments subgroup also used other 
metrics for measuring capacity. For example, for measuring munitions 
production, the subgroup used pounds and units, and for measuring 
munitions storage, the subgroup used square feet and short tons. The 
disparate nature of the functions analyzed by the group did not lend 
itself to a "one size fits all" analytical approach and each of the 
three subgroups conducted its own capacity analysis. 

The munitions and armaments and ship overhaul and repair subgroups 
defined excess capacity as the difference between current capacity and 
current usage. For depot maintenance, the maintenance subgroup defined 
excess capacity as the difference between current capacity and the 
larger of current usage or core requirements. Core requirements are 
those workload needs that must be performed in organic rather than 
contractor facilities. For intermediate maintenance, the maintenance 
subgroup defined excess capacity as the difference between current 
capacity and current usage. The cross-service group's capacity analysis 
showed that excess capacity existed within many of functional areas it 
examined, especially in those of munitions and armaments functions. As 
shown in table 27, the estimates of excess capacity ranged from 7 
percent to 91 percent among individual functional categories. 

Table 27: Excess Capacity Identified by the Industrial Joint Cross-
Service Group: 

Subgroup: Maintenance: 

Function: Ground vehicles, aircraft, and other depot maintenance; 
Capacity measure: Direct labor hours; 
Percentage of excess capacity: 7%. 

Function: Ground vehicles, aircraft, and other intermediate 
maintenance; 
Capacity measure: Direct labor hours; 
Percentage of excess capacity: 16%. 

Subgroup: Ship overhaul and repair: 

Function: Ship depot maintenance; 
Capacity measure: Direct labor hours; 
Percentage of excess capacity: 20%. 

Function: Ship intermediate maintenance; 
Capacity measure: Direct labor hours; 
Percentage of excess capacity: 17%. 

Subgroup: Munitions and armaments: 

Function: Munitions production; 
Capacity measure: Pounds/units; 
Percentage of excess capacity: 36%. 

Function: Munitions storage; 
Capacity measure: Square feet/short tons; 
Percentage of excess capacity: 40%. 

Function: Munitions demilitarization; 
Capacity measure: Short tons; 
Percentage of excess capacity: 91%. 

Function: Munitions maintenance; 
Capacity measure: Direct labor hours; 
Percentage of excess capacity: 35%. 

Function: Armaments production; 
Capacity measure: Direct labor hours; 
Percentage of excess capacity: 44%. 

Source: Industrial Joint Cross-Service Group. 

Note: These excess capacity figures are based on one eight-hour shift 
and current capacity. 

[End of table]

The three subgroups addressed surge requirements in their capacity 
analyses to varying degrees. For the maintenance subgroup, the excess 
percentages represent excess capacity above surge requirements, because 
the collected core requirements data included surge requirements and 
the excess capacity calculations were based on the larger of current 
usage or core requirements. For the munitions and armaments subgroup, 
the excess capacity percentages represent the capacity available to 
meet surge requirements. According to munitions and armaments subgroup 
officials, there are no over-arching, quantified, DOD-wide surge 
requirements for munitions and armaments. Instead, surge becomes a 
factor of how much excess capacity is available and can be addressed 
through multiple work shifts. Conversely, the percentages for ship 
repair and overhaul do not address surge requirements. According to 
ship overhaul and repair subgroup officials, because the Navy's surge 
requirements are dictated by emergent deployments or ship repair 
requirements and because shipyards are normally workloaded to their 
workforce capacity, surge capability is limited to the use of overtime 
and delaying previously planned work. 

As table 27 shows, the data indicate that there was not much excess 
capacity in the ground vehicles, aircraft, and other depot maintenance 
area. Therefore, in that area the group focused much of its attention 
on minimizing sites by redistributing and consolidating workload. On 
the other hand, while many of the group's ship overhaul and repair and 
munitions and armaments recommendations were directed toward reducing 
excess capacity, group officials did not calculate a percentage for the 
reduction in excess capacity made possible by implementing the 
recommendations. 

Military Value Analysis: 

The military value of activities within the group played a predominant 
role in formulating recommendations. In completing its military value 
assessment, the industrial group assessed each activity across the four 
established military value criteria to more fully evaluate the 
potential for realignment and closure actions. As was the case with 
capacity analysis, the disparate nature of the industrial areas 
analyzed by the group precluded a uniform analytical approach among the 
three subgroups. As a result, the subgroups differed in the methodology 
they used to develop relative weights for the military value criteria 
for each of their functions. Table 28 shows the various weights 
assigned to each of the four military value criteria by the subgroups 
for their functions. 

Table 28: Industrial Joint Cross-Service Group Military Value Criteria 
Weights: 

Figures in percentages. 

Military value criteria: 1. The current and future mission capabilities 
and the impact on operational readiness of the total force of the 
Department of Defense, including impact on joint warfighting, training, 
and readiness; 
Maintenance weight: Depot: 39%; 
Maintenance weight: Intermediate: 50%; 
Ship overhaul and repair weight: Depot: 25%; 
Ship overhaul and repair weight: Intermediate: 50%; 
Munitions and armaments weight: Munitions production: 35%; 
Munitions and armaments weight: Munitions maintenance, storage, and 
demilitarization: 25%; 
Munitions and armaments weight: Armaments manufacturing and production: 
45%. 

Military value criteria: 2. The availability and condition of land, 
facilities, and associated air space (including training areas suitable 
for maneuver by ground, naval, or air forces throughout a 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; 
Maintenance weight: Depot: 30%; 
Maintenance weight: Intermediate: 30%; 
Ship overhaul and repair weight: Depot: 25%; 
Ship overhaul and repair weight: Intermediate: 15%; 
Munitions and armaments weight: Munitions production: 15%; 
Munitions and armaments weight: Munitions maintenance, storage, and 
demilitarization: 20%; 
Munitions and armaments weight: Armaments manufacturing and production: 
15%. 

Military value criteria: 3. The ability to accommodate contingency, 
mobilization, surge, and future total force requirements at both 
existing and potential receiving locations to support operations and 
training; 
Maintenance weight: Depot: 21%; 
Maintenance weight: Intermediate: 15%; 
Ship overhaul and repair weight: Depot: 30%; 
Ship overhaul and repair weight: Intermediate: 25%; 
Munitions and armaments weight: Munitions production: 45%; 
Munitions and armaments weight: Munitions maintenance, storage, and 
demilitarization: 50%; 
Munitions and armaments weight: Armaments manufacturing and production: 
35%. 

Military value criteria: 4. The cost of operations and the manpower 
implications; 
Maintenance weight: Depot: 10%; 
Maintenance weight: Intermediate: 5%; 
Ship overhaul and repair weight: Depot: 20%; 
Ship overhaul and repair weight: Intermediate: 10%; 
Munitions and armaments weight: Munitions production: 5%; 
Munitions and armaments weight: Munitions maintenance, storage, and 
demilitarization: 5%; 
Munitions and armaments weight: Armaments manufacturing and production: 
5%. 

Total; 
Maintenance weight: Depot: 100%; 
Maintenance weight: Intermediate: 100%; 
Ship overhaul and repair weight: Depot: 100%; 
Ship overhaul and repair weight: Intermediate: 100%; 
Munitions and armaments weight: Munitions production: 100%; 
Munitions and armaments weight: Munitions maintenance, storage, and 
demilitarization: 100%; 
Munitions and armaments weight: Armaments manufacturing and production: 
100%. 

Source: DOD and the Industrial Joint Cross-Service Group. 

Note: The system of weights provided a basis for assigning relative 
value to data collected and tabulated across each military value 
dimension. The munitions maintenance, storage and demilitarization 
functions were combined because the munitions and armaments subgroup 
applied the same weights for these functions. 

[End of table]

The group's military value analysis also included the development of 
attributes, metrics, and data call questions for each of the nine 
functional areas represented in the categories in the chart above which 
were linked back to the four military criteria. Figure 15 provides 
examples of these attributes, metrics, and data questions and shows how 
each of these was linked back to the criteria. 

Figure 15: Selected Attributes, Metrics, and Data Questions Used to 
Assess Military Value of Depot Maintenance Activities: 

[See PDF for image] 

[A] The BRAC military value criteria are the first four BRAC selection 
criteria. 

[B] Military value attributes are characteristics of each criterion. 
The industrial group used a total of 27 military value attributes. 

[C] Military value metrics are measures for the attributes. The 
industrial group used a total of 58 military value metrics. 

[D] The industrial group used a total of 89 data call questions. 

[End of figure] 

Because of the disparate nature of the industrial areas analyzed by the 
industrial group, the subgroups also differed in the way they assigned 
military value scores to their respective activities. For instance, the 
maintenance subgroup determined military value by commodity[Footnote 
114] only and did not develop an overall military value score for 
activities in the depot and intermediate maintenance functions. Because 
military value scores were only determined for activities by commodity, 
activities were only ranked within their respective commodities. For 
example, Rock Island Arsenal, Illinois, received a military value score 
for its combat vehicle maintenance workload and was ranked accordingly 
against all the other depot level activities that perform combat 
vehicle maintenance. In addition, because most activities involve 
multiple commodities, such as major maintenance functions like aircraft 
engines, electronics, etc., many of the activities received multiple 
military value scores. In the case of Rock Island Arsenal, it not only 
received a military value score for its combat vehicle maintenance work 
but also for its tactical vehicle maintenance work and its other 
equipment maintenance work. These military value scores were then used 
in an optimization model to determine the best locations to consolidate 
various like commodities among the three services. In all cases, the 
subgroup examined redistributing the workload to activities with a 
higher military value score for that commodity. According to the 
maintenance subgroup, determining military value by commodity allowed 
for more opportunities to create interservicing[Footnote 115] and 
consolidations of workload among the services. The maintenance 
subgroup's process was focused on military value and available capacity 
without regard to service. The final recommendations were tempered by 
financial and operational considerations. However, as we discuss later, 
our analysis shows that while some interservicing may be achieved, most 
of the group's recommendations remained relatively service-centric. The 
ship overhaul and repair and munitions and armaments subgroups, on the 
other hand, developed overall military value scores for activities 
within their respective functions and ranked their activities within 
those functions accordingly. For example, all shipyards were ranked 
together under the depot maintenance function, and all industrial 
activities that perform munitions production were ranked together under 
the munitions production function. 

DOD Inspector General's and Service Audit Agencies' Role in the 
Process: 

The DOD Inspector General and the service audit agencies played 
important roles in ensuring that the data used in the industrial 
group's data analyses were certified and properly supported. Through 
extensive audits of the data collected from field activities during the 
process, these audit agencies notified the group regarding any 
identified data discrepancies for the purpose of follow-on corrective 
action. While the process for detecting and correcting data errors was 
quite lengthy, the audit agencies ultimately deemed the industrial data 
to be sufficiently accurate for use in the BRAC process. 

Identification and Assessment of Alternate Scenarios and Selection of 
Recommendations: 

The industrial group did not have complete capacity or military value 
data when it initiated the development of potential closure and 
realignment scenarios. Therefore, it had to rely on incomplete data as 
well as military judgment to determine which industrial areas had 
excess capacity and which could receive new workloads. As time 
progressed, however, the group obtained the needed data to inform and 
support its scenarios. The DOD Inspector General validated the data. 

The maintenance and munitions and armaments subgroups used an 
optimization model to help facilitate scenario development, while the 
ship overhaul and repair subgroup, which had similar data problems, 
also relied on incomplete data as well as military judgment to help 
formulate scenarios for consideration. This subgroup did not rely on 
the optimization model as extensively as the other subgroups due to the 
relatively small number of activities analyzed. Collectively, the 
subgroups initially developed 120 proposals and scenarios and with the 
maturation of the data, completion of Cost of Base Realignment Actions 
(COBRA) analyses, and elimination of alternative scenarios, the 
industrial group settled on 34 recommendations that were forwarded to 
the ISG with all but 3 being ultimately approved by the IEC. 

Despite having incomplete data, the maintenance subgroup began its 
scenario development by generating several ideas as potential 
scenarios. In testing the feasibility of these ideas, the maintenance 
subgroup found it useful to use an optimization model, because the 
subgroup was dealing with a universe of 57 commodities across 28 depot 
level activities and 11 commodities across over 200 intermediate level 
activities which made it extremely difficult to determine where 
workload could be consolidated or redistributed. For realignment 
considerations, officials told us the preferred method was to 
consolidate workload at the highest military value sites that remained 
open in the optimization results, but military judgment also played a 
role in finalizing the sites. In some instances, military judgment was 
used to override the results of the optimization model. For example, 
the subgroup chose not to realign the rotary aircraft workload from the 
Naval Air Depot at Cherry Point, North Carolina, to the Corpus Christi 
Army Depot, Texas, even though it was proposed for realignment under 
the optimization model because of concerns about establishing a single 
point of failure or vulnerability for DOD's rotary aircraft workload. 

One issue that the maintenance subgroup dealt with during its scenario 
development was that the current DOD capacity baseline for its 
maintenance work was based on a single shift 40 hours per week 
workload. According to the subgroup, when using the optimization model, 
it found that existing capacity as measured on this basis would 
constrain its ability to identify options for achieving more economical 
operations. Further, recognizing that such a baseline was inconsistent 
with industry practice, the subgroup modified the capacity baseline to 
one and a half shifts with a 60 hours weekly workload, thus increasing 
available capacity at its industrial activities and the potential for 
consolidating work at fewer locations. As we reported after the 1995 
BRAC round, a capacity baseline of a single shift 40 hours per week 
workload is a conservative projection of capacity because the private 
sector frequently uses a capacity baseline of two or two and a half 
shifts.[Footnote 116] In addition, based on more current information of 
private sector capacity utilization, we still believe that a single 
shift is a conservative projection of capacity, since many firms today 
work multiple shifts. 

Like the maintenance subgroup, the munitions and armaments subgroup 
also used the optimization model to test the feasibility of its ideas 
and to facilitate its scenario development and analysis. Its emphasis 
was on increasing multi-functional activities, (i.e., those activities 
that have the capability to do more than one munitions and armaments 
function). During scenario development, the subgroup's preference was 
to eliminate excess capacity through closure versus realignment. 

The ship overhaul and repair subgroup, on the other hand, used mostly 
capacity and military value data in combination with military judgment 
in developing and analyzing its scenarios. Due to the small number of 
activities analyzed--22 depot and intermediate level ship overhaul and 
repair activities--the subgroup did not have to rely on the 
optimization model to determine where workload could be potentially 
consolidated or redistributed. While it did use the model primarily to 
check the feasibility and rationalization of scenarios, military 
judgment was required because most of the subgroup's scenarios were 
influenced by Navy force structure changes and planned changes in the 
homeports of ships. According to industrial group officials, expected 
out-year changes in Navy force structure--specifically expected 
reductions in the number of ships--allowed them to recommend the 
closure of a shipyard. Expected changes in the homeports of ships also 
influenced the subgroup's intermediate level scenarios because the 
Navy's intermediate level maintenance is generally performed where 
ships are homeported. 

Recommendations Approved by DOD: 

The industrial group's 17 recommendations are estimated to produce an 
estimated $7.6 billion in 20-year net present value savings. Table 29 
provides a summary of the financial aspects of the group's 
recommendations. 

Table 29: Financial Aspects of the Industrial Joint Cross-Service 
Group's Recommendations: 

Fiscal year 2005 constant dollars in millions. 

Recommended action: Realign to establish Navy Fleet Readiness Centers; 
DOD report page: Ind-19; 
One-time (costs): ($298.1); 
Net implementation (costs) or savings[A]: $1,528.2; 
Net annual recurring (costs) or savings: $341.2; 
Payback period (years): immediate; 
20-year net present value (costs) or savings[B]: $4,724.2. 

Recommended action: Close Hawthorne Army Depot, NV; 
DOD report page: Ind-12; 
One-time (costs): ($180.3); 
Net implementation (costs) or savings[A]: $59.2; 
Net annual recurring (costs) or savings: $73.4; 
Payback period (years): immediate; 
20-year net present value (costs) or savings[B]: $777.7. 

Recommended action: Close Umatilla Chemical Depot, OR; 
DOD report page: Ind-14; 
One-time (costs): ($15.5); 
Net implementation (costs) or savings[A]: $89.1; 
Net annual recurring (costs) or savings: $61.0; 
Payback period (years): immediate; 
20-year net present value (costs) or savings[B]: $681.1. 

Recommended action: Close Newport Chemical Depot, IN; 
DOD report page: Ind-8; 
One-time (costs): ($7.1); 
Net implementation (costs) or savings[A]: $95.6; 
Net annual recurring (costs) or savings: $35.7; 
Payback period (years): immediate; 
20-year net present value (costs) or savings[B]: $436.2. 

Recommended action: Close Deseret Chemical Depot, UT; 
DOD report page: Ind-17; 
One-time (costs): ($4.4); 
Net implementation (costs) or savings[A]: $65.1; 
Net annual recurring (costs) or savings: $30.3; 
Payback period (years): immediate; 
20-year net present value (costs) or savings[B]: $356.4. 

Recommended action: Close Lone Star Army Ammunition Plant, TX; 
DOD report page: Ind-16; 
One-time (costs): ($29.0); 
Net implementation (costs) or savings[A]: ($4.7); 
Net annual recurring (costs) or savings: $17.3; 
Payback period (years): immediate; 
20-year net present value (costs) or savings[B]: $164.2. 

Recommended action: Realign Ship Intermediate Maintenance Activity 
Norfolk, VA; 
DOD report page: Ind-18; 
One-time (costs): ($10.6); 
Net implementation (costs) or savings[A]: $26.8; 
Net annual recurring (costs) or savings: $8.2; 
Payback period (years): 1; 
20-year net present value (costs) or savings[B]: $104.3. 

Recommended action: Close Kansas Army Ammunition Plant, KS; 
DOD report page: Ind-9; 
One-time (costs): ($25.2); 
Net implementation (costs) or savings[A]: $2.1; 
Net annual recurring (costs) or savings: $10.3; 
Payback period (years): 2; 
20-year net present value (costs) or savings[B]: $101.4. 

Recommended action: Realign Sierra Army Depot, CA; 
DOD report page: Ind-6; 
One-time (costs): ($33.4); 
Net implementation (costs) or savings[A]: ($7.2); 
Net annual recurring (costs) or savings: $7.5; 
Payback period (years): 7; 
20-year net present value (costs) or savings[B]: $66.7. 

Recommended action: Close Riverbank Army Ammunition Plant, CA; 
DOD report page: Ind-5; 
One-time (costs): ($25.2); 
Net implementation (costs) or savings[A]: ($10.4); 
Net annual recurring (costs) or savings: $6.5; 
Payback period (years): 3; 
20-year net present value (costs) or savings[B]: $53.3. 

Recommended action: Close Mississippi Army Ammunition Plant, MS; 
DOD report page: Ind-11; 
One-time (costs): ($32.4); 
Net implementation (costs) or savings[A]: ($10.8); 
Net annual recurring (costs) or savings: $5.1; 
Payback period (years): 7; 
20-year net present value (costs) or savings[B]: $38.6. 

Recommended action: Realign Lackland Air Force Base, TX; 
DOD report page: Ind-15; 
One-time (costs): ($10.2); 
Net implementation (costs) or savings[A]: $0.1; 
Net annual recurring (costs) or savings: $2.9; 
Payback period (years): 3; 
20-year net present value (costs) or savings[B]: $28.0. 

Recommended action: Realign Lima Army Tank Plant, OH; 
DOD report page: Ind-10; 
One-time (costs): ($0.2); 
Net implementation (costs) or savings[A]: $5.9; 
Net annual recurring (costs) or savings: $1.7; 
Payback period (years): immediate; 
20-year net present value (costs) or savings[B]: $22.3. 

Recommended action: Realign Naval Shipyard Detachments; 
DOD report page: Ind-26; 
One-time (costs): ($12.5); 
Net implementation (costs) or savings[A]: $0.9; 
Net annual recurring (costs) or savings: $2.3; 
Payback period (years): 4; 
20-year net present value (costs) or savings[B]: $20.7. 

Recommended action: Realign Naval Weapons Station Seal Beach, CA; 
DOD report page: Ind-4; 
One-time (costs): ($4.1); 
Net implementation (costs) or savings[A]: $2.3; 
Net annual recurring (costs) or savings: $1.6; 
Payback period (years): 1; 
20-year net present value (costs) or savings[B]: $17.7. 

Recommended action: Realign Rock Island Arsenal, IL; 
DOD report page: Ind-7; 
One-time (costs): ($27.0); 
Net implementation (costs) or savings[A]: ($16.2); 
Net annual recurring (costs) or savings: $3.1; 
Payback period (years): 9; 
20-year net present value (costs) or savings[B]: $13.8. 

Recommended action: Realign Watervliet Arsenal, NY; 
DOD report page: Ind-13; 
One-time (costs): ($63.7); 
Net implementation (costs) or savings[A]: ($46.8); 
Net annual recurring (costs) or savings: $5.2; 
Payback period (years): 18; 
20-year net present value (costs) or savings[B]: $5.2. 

Total; 
One-time (costs): ($778.9); 
Net implementation (costs) or savings[A]: $1,779.2; 
Net annual recurring (costs) or savings: $613.3; 
20-year net present value (costs) or savings[B]: $7,611.8. 

Source: GAO analysis of DOD data. 

[A] This represents net costs or savings within the 6-year 
implementation period required to implement BRAC recommendations. 

[B] DOD used a 2.8 percent discount rate to calculate net present 
value. 

[End of table]

Most of the projected savings from the group's recommendations are 
concentrated in relatively few recommendations and nearly all have an 
immediate or moderately short payback period where projected savings 
are anticipated to offset the implementation costs either immediately 
or within a few years. The recommendation regarding the establishment 
of Navy fleet readiness centers is by far the largest in terms of 
overall savings, accounting for about $341 million, or about 56 
percent, of the total estimated net annual recurring savings. As 
discussed later, only one recommendation--the realignment of the 
Watervliet Arsenal, New York, has a lengthy payback period exceeding 10 
years. 

Of the industrial joint cross-service group's 17 recommendations, 8 are 
closures and 9 are realignments. However, contained within these 
recommendations are 40 smaller, individual realignment actions and 
several recommendations involve installations with less than 300 
personnel that could be but were not required to be proposed under 
BRAC. The following summarizes some of our overall observations about 
the group's recommendations. 

* Interservicing: Despite setting up its military value scoring for 
maintenance by commodity to foster opportunities for interservicing, 
the industrial group actually developed few recommendations that 
proposed greater interservicing. Of the 9 realignment recommendations, 
we consider only three to involve interservicing--(1) realigning the 
Air Force's depot maintenance workload at Lackland Air Force Base, 
Texas, to Tobyhanna Army Depot, Pennsylvania, (2) realigning the Navy's 
depot maintenance at Naval Weapons Station Seal Beach, California to 
several other service depots, and (3) realigning Lima Army Tank Plant, 
Ohio, to support, in part, the future manufacturing of the Marine Corps 
expeditionary force vehicle. DOD has stated recently that there is some 
interservicing of ground maintenance work already being performed at 
the major depots. However, while there is significant interservicing of 
electronics work at Tobyhanna Army Depot, Pennsylvania and of rotary 
work at Corpus Christi Army Depot, Texas, our analysis shows that 
interservicing at the major ground vehicle maintenance depots is very 
limited. For example, in fiscal year 2003, only 3 percent of Anniston 
Army Depot's total workload was for the Marine Corps and only 3 percent 
of Marine Corps Logistics Base Barstow's and Marine Corps Logistics 
Base Albany's workloads was for the Army. Moreover, out of 17 major 
maintenance depots across the services, the group only proposed the 
closure of three--Portsmouth Naval Shipyard, Maine, Red River Army 
Depot, Texas and Marine Corps Logistics Base Barstow, California--with 
Barstow ultimately becoming a realignment. No recommendations were 
developed regarding the Air Force's three relatively large air 
logistics centers and only Navy-centric recommendations were developed 
regarding the Navy's three naval air depots, despite that the 
industrial group had registered scenarios consolidating similar types 
of work from a naval air depot into air logistics centers. According to 
group officials, they decided not to propose these as recommendations 
because of the Navy's desire to combine its aircraft depot and 
intermediate work into fleet readiness centers and because this 
recommendation offered greater financial benefits. As a result, this 
essentially removed the naval air depots from the BRAC analysis in 
considering opportunities for more interservicing. While not considered 
an industrial group recommendation or otherwise addressed in this 
appendix, the industrial group's work also helped the Navy develop a 
recommendation realigning some of the workload at Marine Corps 
Logistics Base Barstow to Army depots. This recommendation is discussed 
in appendix IV. 

* Closures: Regarding eight closures, four involve underutilized Army 
ammunition facilities, and three are chemical demilitarization 
facilities where the primary mission is slated to disappear in the 
coming years. 

* Savings: Essentially all of the projected savings from the group's 
recommendations are based on reducing overhead and eliminating civilian 
and military personnel as installations are closed and functions are 
realigned between installations. For example, 63 percent of the group's 
total projected net annual recurring savings is from reductions in 
overhead and 37 percent is from personnel eliminations with civilians 
making up 21 percent of total net annual recurring savings and military 
personnel 16 percent. 

Taken individually, the recommendation that the industrial group 
expects will generate the greatest amount of savings is the 
establishment of the Navy's fleet readiness centers, which is estimated 
to produce net annual recurring savings of $341 million or 56 percent 
of the group's total net annual recurring savings and an estimated 20-
year net present value savings of $4.7 billion or 62 percent of the 
group's estimated total net present value savings. This realignment 
recommendation differs from the other realignments in that it proposes 
a significant business process reengineering effort to integrate the 
Navy's non-deployable, intermediate and depot level aircraft 
maintenance rather than a consolidation or realignment of workload. 
While the changes proposed would appear to have the potential for 
significant savings, as explained below, some uncertainty exists about 
the full magnitude of the savings estimate for this recommendation 
because most of the group's projected savings are based on efficiency 
gains that have yet to be validated. For example, based on our 
analysis, over 63 percent of the estimated net annual recurring savings 
for this recommendation are miscellaneous recurring savings projected 
to accrue from overhead efficiencies, such as reduced repair time and 
charges, while 12 percent of the annual recurring savings is produced 
from reductions in military personnel and 24 percent of the savings is 
derived from reductions in civilian personnel. These efficiencies are 
expected to be gained from integrating intermediate and depot levels of 
maintenance and not having to ship as many items to faraway depots for 
repair. In addition, 34 percent of the group's net implementation 
savings for this recommendation is derived from other one-time unique 
savings accrued from one-time reductions in spare parts inventories. 

Issues Identified with Approved Recommendations: 

Time did not permit us to assess the operational impact of each of the 
industrial group's recommendations that was approved by DOD, 
particularly those with minimal financial impact and where minimal 
realignment and consolidation of workload was proposed. At the same 
time, however, we offer a number of broad-based observations about 
selected proposed recommendations regarding high payback periods and 
uncertain savings that the BRAC Commission may want to consider in its 
review. 

Navy's Fleet Readiness Centers: 

The recommendation on fleet readiness centers is essentially a Navy 
business process reengineering effort to transform the way the Navy 
conducts aircraft maintenance by integrating existing, non-deployable, 
intermediate and depot maintenance levels into a single, seamless 
maintenance level. The fleet readiness center construct focuses on the 
philosophy that some depot level maintenance actions are best 
accomplished at or near the operational fleet. Although the data 
suggests the potential for savings, we believe there is some 
uncertainty regarding the magnitude of the industrial group's expected 
savings for these readiness centers because its estimates are based on 
assumptions that have undergone limited testing, and full savings 
realization depends upon the transformation of the Navy's supply 
system. In determining the amount of savings resulting from the 
establishment of the fleet readiness centers, the industrial group and 
the Navy made a series of assumptions that focused on combining depot 
and intermediate maintenance in a way that would reduce the time an 
item is being repaired at the intermediate level, which in turn, would 
simultaneously reduce the number of items needed to be kept in 
inventory and the number of items sent to a depot for repair. These 
assumptions, which were the major determinant of realignment savings, 
were based on historical data and pilot projects and have not been 
independently reviewed or verified by the Naval Audit Service, DOD 
Inspector General, or us. Moreover, how well these actions, if 
approved, are implemented will be key to determining the amount of 
savings realized. 

According to the group, two types of savings account for the majority 
of the projected savings from the fleet readiness center 
recommendation. First, one-time savings are projected to accrue from 
reductions in inventory maintained at several Navy shore locations 
because item repair cycle time for components is reduced with more 
depot level maintenance being performed at or near the fleet, generally 
at an intermediate facility. According to group officials, this 
reduction is accomplished by stationing several depot level repair 
personnel at an intermediate facility to assist in repairing an item on 
site rather that spending time re-packing and shipping the item to a 
depot for repair. By reducing the turnaround time for an item--that is, 
time spent in transit to and from a depot level repair facility, group 
officials estimate that the average time an item is in the repair 
pipeline will decrease from 28 hours to 9 hours, with nearly all that 
time spent on the actual repair. The industrial group maintains this 
reduction in turnaround time will allow for savings since fewer items 
will need to be kept in the shore based aviation consolidated inventory 
because items will be getting repaired quicker and returned to the 
inventory faster.[Footnote 117] The second type of savings is recurring 
overhead savings that are projected to accrue from fewer items being 
sent to depots for repair. According to group officials, establishing 
fleet readiness centers will result in fewer items being sent to a 
depot to be repaired, thus reducing per item maintenance costs. These 
savings are captured in the COBRA model under overhead as miscellaneous 
recurring savings. As explained by group officials, when an item is 
sent to a depot, two charges are applied to the cost to repair the 
item--a component unit price and a cost recovery rate. So, if fewer 
items are sent to a depot, then fewer repair charges are incurred and 
less overhead costs are incurred. 

However, according to an industrial group official, since the depots 
will have fewer items to repair, they will have fewer opportunities to 
generate revenue to support their working capital fund 
operations.[Footnote 118] This situation, in turn, could create an 
incentive for the depot to increase its cost recovery rate for items it 
does repair to make up for reduced revenues. If this were to occur, 
then the projected savings would not materialize because most of the 
fleet readiness center savings are based on a reduction in the number 
of items sent to depots and are contingent on the supply system not 
drastically raising the cost recovery rate. According to industrial 
group officials, it will be important to overall transformation efforts 
that DOD follow through on eliminating management structures and 
duplicate layers of inventory in the supply system. Also, according to 
these officials, some of this supply-side transformation is already 
underway at the retail level in the form of a partnership between fleet 
industrial supply centers and the naval air depots where material 
management for the depots was handed over to the supply centers to 
standardize supply chain processes, improve material availability, and 
reduce the material excesses that have been a difficult problem for the 
naval air depots. In addition, group officials stated that the supply 
and storage joint cross-service group's recommendation to realign 
supply, storage, and distribution management should also further this 
transformation by eliminating unnecessary redundancies and duplication 
and by streamlining supply and storage processes, which will reduce 
costs and help prevent a large increase in the cost recovery rate. 

In addition, we believe there is some potential risk in properly 
accounting for depot level work to meet legislatively mandated 
reporting requirements on the percentage of depot workload performed in 
government and contractor facilities,[Footnote 119] absent efforts to 
ensure adequate differentiation of work completed for intermediate and 
depot level maintenance. We previously reported on similar difficulties 
in 2001 involving a consolidation of intermediate and depot level work 
at Pearl Harbor Naval Shipyard, Hawaii.[Footnote 120] We noted that, 
prior to consolidation, the Navy's determination of depot and 
intermediate maintenance work was based on which facility performed it-
-the former Pearl Harbor shipyard performed depot work, and the former 
intermediate maintenance facility performed intermediate work. However, 
because Pacific Fleet and Pearl Harbor officials asserted that all work 
was considered and classified the same at the consolidated facility, 
the management and financial systems did not differentiate between 
depot and intermediate categories of work. As a result, the lines 
between what was considered intermediate and depot maintenance became 
blurred, making it harder to report what was intermediate and depot 
maintenance. The industrial group maintains that during the first few 
years of implementing the fleet readiness center recommendation, the 
Navy will continue to operate depot maintenance within the working 
capital fund (setting up a separate holding account) and perform 
intermediate maintenance with mission funding. During this period, 
depot maintenance will be reported as depot maintenance and 
intermediate maintenance will be reported as intermediate maintenance. 
While this should mitigate the accounting issue in the short-term, it 
is unclear to what extent longer term measures will be needed to ensure 
proper reporting of depot work to meet statutory requirements. 

Savings for Chemical Depots after Implementation: 

The net annual recurring savings may be overstated for the three 
chemical depots recommended for closure--Newport, Umatilla, and 
Deseret--and it is unclear whether such facilities are appropriately 
included in the BRAC process.[Footnote 121] The industrial group 
estimated net annual recurring savings of $127 million for the three 
chemical demilitarization facilities, $20 million of which is from 
anticipated savings by not recapitalizing these closed BRAC 
installations. However, the current missions of each of these 
installations are focused on the destruction of existing chemical 
weapons stockpiles, and after the stockpiles are destroyed, the 
destruction facilities themselves are scheduled to be dismantled and 
disposed of in accordance with applicable laws and agreements with the 
governors of the states in which they are located. With the exception 
of the recommended transfer of storage igloos and magazines from 
Deseret to Tooele Army Depot, Utah, Army officials have not identified 
any existing plans for future missions at these depots once the 
chemical destruction mission is complete. Consequently, it is unclear 
how the closure of the depots will result in recapitalization savings. 
Additionally, given the general delays in the Army's chemical weapons 
destruction program[Footnote 122] it is uncertain that it will be able 
to complete the chemical weapons destruction mission and close these 
depots within the 6-year BRAC statutory implementation period. 

Hawthorne Army Depot: 

There is uncertainty surrounding the Army's ability to close the 
Hawthorne Army Depot, Nevada, by 2011, the final year as prescribed by 
the BRAC legislation for implementing BRAC actions. The Army may be 
unable to demilitarize all the unserviceable munitions stored at the 
depot by 2011, thereby placing the Army at risk for closing the depot 
by that date. Army officials told us that demilitarization funds have 
not been fully used for demilitarization purposes in recent years, but 
for other purposes. As a result, the stockpile of unserviceable 
munitions is growing. The funding situation is of such concern that an 
Army official told us they intend to request the DOD Comptroller issue 
a memorandum that would administratively "fence" funding in the 
demilitarization account to better ensure that the funds will be used 
for reducing the stockpiles of unserviceable munitions. This official 
also told us that this funding situation could be further exacerbated 
with the potential for the return to the United States of additional 
unserviceable munition stockpiles that are currently stored in Korea, 
even though the group considered these stocks in its analysis. This 
official stated that if these unserviceable munitions are returned for 
demilitarization to Hawthorne, there will be added pressure to finish 
the demilitarization process in time to close the facility by 2011. 

Closure of Ammunition Plants: 

Currently, the Army leases some property at its ammunition plants 
through the Army's program called the Armament Retooling and 
Manufacturing Support Initiative. DOD has recommended for closure four 
ammunition plants that are part of this initiative--Mississippi, 
Kansas, Lone Star, and Riverbank. We previously reported that, while 
this initiative has offset some of the Army's maintenance costs, 
maintaining ammunition plants in an inactive status still represents a 
significant cost to the federal government.[Footnote 123] Through this 
initiative, the Army contracts with an operating contractor that 
conducts maintenance, repair, restoration, and remediation in return 
for use of the inactive part of the facility. The operating contractor, 
in turn, locates and negotiates with tenants regarding lease rates, 
facility improvements, and contract terms. However, the effect on these 
tenants of closing the four ammunition plants involved with the 
initiative is currently unknown. Army officials responsible for the 
initiative told us that past transfers of such property outside of the 
BRAC process have been handled poorly in that the General Services 
Administration or Army Corps of Engineers, the agencies responsible for 
transferring excess property, evicted the tenants and then sold the 
property separately, as was the case in past closures such as the 
Indiana Army Ammunition Plant. Army officials said that property 
transfers conducted in this manner could be costly because the 
government must incur some costs that were paid by the tenants, such as 
for security and maintenance. For example, an Army analysis showed that 
retaining the ARMS tenants on Indiana Army Ammunition plant rather than 
evicting them would have saved about $41 million. Additionally, DOD may 
incur some costs if leases are terminated early. An industrial group 
official told us that the group included termination costs for leases 
that extended past the proposed closure date but only for tenants 
performing DOD work, not for other tenants. We believe that lease 
termination costs should have been included for any tenant's lease that 
extends past the proposed closure date, since there may be a cost 
incurred for breaking the lease early. However Army officials said that 
it would be difficult to estimate such potential costs at this time. 

Watervliet Arsenal, New York: 

Despite having a payback period of 18 years, the industrial group 
proposed the realignment of Watervliet Arsenal, New York, because it 
has considerable excess capacity and DOD will no longer require some of 
its capabilities. The group had originally considered either moving the 
entire workload of the arsenal to Rock Island Arsenal, Illinois, or 
moving the entire workload of Rock Island Arsenal to Watervliet 
Arsenal. However, according to industrial group officials environmental 
issues regarding potential chromium discharges into the Mississippi 
River and costs associated with moving heavy industrial equipment 
precluded a cost-effective realignment of moving the work at Watervliet 
Arsenal to Rock Island Arsenal. Similarly, air quality issues regarding 
sulfur dioxide emissions along with the costs to move equipment 
precluded a cost-effective realignment of moving the work at Rock 
Island Arsenal work to Watervliet Arsenal, since the Northeast region 
already exceeds allowable limits for sulfur dioxide emissions. As shown 
in the table 29, the Watervliet recommendation has a payback period of 
18 years, with about $63.7 million in one time unique costs and only 
$5.2 million in net annual recurring savings. According to industrial 
group officials, these one-time costs reflect the costs of "shrinking 
the footprint," (i.e., moving out of buildings and eliminating and 
moving excess equipment at both the arsenal and the accompanying 
research laboratories also located at the arsenal). 

[End of section]

Appendix IX: Intelligence Joint Cross-Service Group Selection Process 
and Recommendations: 

The Intelligence Joint Cross-Service Group followed the common 
analytical framework established by the Office of the Secretary of 
Defense (OSD) in reviewing its functions and facilities. The 
Intelligence Joint Cross-Service Group produced two recommendations 
that it projects will yield about $588 million in 20-year net present 
value savings, with a payback period of 8 years for each 
recommendation. The majority of savings in the two recommendations 
result from lease terminations. Unlike the services or other groups, 
there is little savings projected from personnel reductions because, 
according to officials, almost all of the personnel will relocate and 
end strength is projected to increase as a result of program growth. 
The DOD Inspector General and service audit agencies, which performed 
audits of the data, concluded that the data were sufficiently reliable 
for use during the BRAC process. 

Organization and Focus: 

The intelligence group was responsible for reviewing intelligence 
functions throughout DOD. Previous BRAC rounds did not involve the 
participation of any joint cross-service group dedicated to analyzing 
intelligence functions. The intelligence group was chaired by the 
Deputy Under Secretary of Defense (Counterintelligence & 
Security).[Footnote 124] The Group's principals included senior members 
from the Defense Intelligence Agency, National Geospatial-Intelligence 
Agency, National Reconnaissance Office, National Security Agency, each 
military department, and the Joint Staff Directorate for Intelligence, 
along with representation from the offices of the Director, Central 
Intelligence Community Management Staff, and the Department of Defense 
Inspector General. 

The intelligence group formed four functional subgroups: Sources and 
Methods; Correlation, Collaboration, Analysis, and Access; Management 
Activities; and National Decisionmaking and Warfighting Capabilities. 
The first three subgroups each created an analytical construct for 
measuring defense intelligence capacity that resulted in a capacity 
data call. These subgroups were eventually replaced by a single Core 
Team that included membership from each organization represented in the 
Intelligence Joint Cross-Service Group. This team created a single, 
consolidated analytical construct for measuring the military value of 
defense intelligence facilities. The team also performed detailed 
capacity and military value analysis, evaluated scenario ideas, 
executed scenario data calls, and prepared Intelligence Joint Cross-
Service Group candidate recommendations for deliberation. 

The overarching intelligence principle the group worked to support was 
that DOD needs intelligence capabilities to support the National 
Military Strategy by delivering predictive analyses, warning of 
impending crises, providing persistent surveillance of our most 
critical targets, and achieving "horizontal" (that is, interagency) 
integration of networks and databases. To do so, the group focused on 
four key objectives: 

* Locating and upgrading facilities on protected installations as 
appropriate. 

* Reducing vulnerable commercial leased space. 

* Realigning selected intelligence functions/activities and 
establishing facilities to support continuity of operations and mission 
assurance requirements. 

* Providing infrastructure to facilitate robust information flow 
between analysts, collectors, and operators at all echelons and achieve 
mission synergy. 

The group conducted an assessment of defense intelligence for 
buildings, facilities, and personnel performing the intelligence 
function. The objective was to project an alignment of present 
capabilities, with current organizational compositions and business 
processes, to desired future operational capabilities, using DOD's 
transformational concepts and preferred organizational construct. 

Framework for Analysis: 

The intelligence group initially identified five broad functions to 
analyze in defense intelligence: Sources and Methods (Acquisition and 
Collection); Analysis; Dissemination; Management Activities; and 
Sustainability. Based on subsequent Infrastructure Steering Group 
guidance, these five broad functions were consolidated into a single 
function--defense intelligence--in the final military value scoring 
plan. Capacity analysis and then military value analysis were the 
starting points for the BRAC analytical process. The DOD Inspector 
General and service audit agencies performed an important role in 
ensuring the accuracy of data used in these analyses through extensive 
audits of data gathered at various locations. 

Capacity Analysis: 

To assess capacity, the intelligence group identified buildings and 
facilities performing the intelligence function and developed related 
attributes, metrics, and questions for analysis. Data calls were issued 
to the defense intelligence community to gather certified data on 
intelligence buildings and facilities. The capacity analysis identified 
limited excess capacity in some organizations, but no overall excess 
capacity, as shown in table 30. 

Table 30: Excess Capacity Identified by the Intelligence Joint Cross-
Service Group: 

Organization: Air Force; 
Percentage of excess capacity (shortage): 0.01%. 

Organization: Army; 
Percentage of excess capacity (shortage): (3%). 

Organization: Marine Corps; 
Percentage of excess capacity (shortage): (20%). 

Organization: Navy; 
Percentage of excess capacity (shortage): (4%). 

Organization: Under Secretary of Defense, Intelligence; 
Percentage of excess capacity (shortage): (17%). 

Organization: Counter Intelligence Field Agency; 
Percentage of excess capacity (shortage): 2%. 

Organization: Joint Staff (Combatant Commands); 
Percentage of excess capacity (shortage): (58%). 

Organization: Defense Intelligence Agency; 
Percentage of excess capacity (shortage): (24%). 

Organization: National Geospatial-Intelligence Agency; 
Percentage of excess capacity (shortage): 11%. 

Organization: National Reconnaissance Office; 
Percentage of excess capacity (shortage): 2%. 

Organization: National Security Agency; 
Percentage of excess capacity (shortage): 0.3%. 

Organization: Total; 
Percentage of excess capacity (shortage): (1.9). 

Source: Intelligence Joint Cross-Service Group. 

Note: Excess capacity measured in square feet. 

[End of table]

The negative excess capacity shown in table 30 differs from the group's 
initial capacity data results, which showed an overall excess capacity 
of 18 percent. However, after reviewing the initial data, the 
intelligence group made two adjustments. First, the group removed 
buildings with no direct intelligence mission, such as barracks, pump 
houses, tunnels, or warehouses. Then the group increased its estimate 
of the area of square feet required for personnel temporarily working 
at another intelligence entity and for contractor personnel by 50 
percent.[Footnote 125] The group did not identify any known documented 
requirements for the defense intelligence community to set aside space 
or facilities for surge. The intelligence community has historically 
handled surge operations by reassigning and reallocating existing 
resources within the current square footage. 

Military Value Analysis: 

All BRAC 2005 selection criteria were applied by the intelligence group 
across the defense intelligence functional support area and used with 
the force structure plan and infrastructure inventory to perform 
analyses. Priority consideration was given to military value by 
evaluating and scoring activities based on the first four selection 
criteria. Table 31 below shows the weighted value the intelligence 
group gave to the criteria, based on a 100-point scale. 

Table 31: Intelligence Joint Cross-Service Group Military Value 
Criteria Weights: 

Figures in percentages. 

Military value criteria: 1. The current and future mission capabilities 
and the impact on operational readiness of the total force of the 
Department of Defense, including the impact on joint warfighting, 
training, and readiness; 40%. 

Military value criteria: 2. The availability and condition of land, 
facilities, and associated airspace (including training areas suitable 
for maneuver by ground, naval, or air forces throughout a 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; 30%. 

Military value criteria: 3. The ability to accommodate contingency, 
mobilization, surge, and future total force requirements at both 
existing and potential receiving locations to support operations and 
training; 20%. 

Military value criteria: 4. The cost of operations and the manpower 
implications; 10%. 

Total; 100%. 

Source: DOD and the Intelligence Joint Cross-Service Group. 

Note: The system of weights provided a basis for assigning relative 
value to data collected and tabulated across each military value 
dimension. 

[End of table]

The intelligence group assessed the military value of its facilities 
based on those facilities' capabilities to support the intelligence 
function. A single scoring plan measured the value of both the 
infrastructure and the personnel performing the defense intelligence 
function at a given facility. Attributes and weighted metrics were used 
to compute the military value of a building by assessing the facility's 
physical infrastructure and locations as they related to selection 
criteria 1 through 4. After computing military value scores, a rank-
ordered listing of the 267 intelligence facilities was developed for 
the defense intelligence function. Subsequently, strategy-driven 
scenarios were validated by analyses of military value data and 
military judgment. Figure 16 illustrates how the military value 
attributes, metrics, and data questions were linked to the military 
value criteria using selected attributes, metrics, and questions. 

Figure 16: Selected Attributes, Metrics, and Data Questions Used to 
Assess Military Value of an Intelligence Facility: 

[See PDF for image] 

[A] The BRAC military value criteria are the first 4 BRAC selection 
criteria. 

[B] Military value attributes are characteristics of each criterion. 
The Intelligence Joint Cross-Service Group used a total of 2 military 
value attributes. 

[C] Military value metrics are measures for the attributes. The 
Intelligence Joint Cross-Service Group used a total of 12 military 
value metrics. 

[D] The Intelligence Joint Cross-Service Group used a total of 59 data 
call questions. 

[End of figure] 

A similar process was followed for all of the 267 intelligence 
facilities. 

DOD Inspector General's and Service Audit Agencies' Role in the 
Process: 

The DOD Inspector General and service audit agencies reviewed the data 
and processes used by the Intelligence Joint Cross-Service Group to 
develop its recommendations. The overall objective was to evaluate the 
validity, integrity, and documentation of data used by the subgroups. 
The DOD Inspector General and service audit agencies used real-time 
audit coverage of data collection and analysis processes to ensure that 
the data used in the groups' capacity analysis, military value 
analysis, and use of optimization models was certified and was used as 
intended. Through extensive audits of the data collected from field 
activities during the process, the DOD Inspector General notified the 
group of data discrepancies for the purpose of follow-on corrective 
action. The DOD Inspector General ultimately determined, once the 
corrections to all the discrepancies were noted, the intelligence data 
to be sufficiently reliable for use in the BRAC process. 

Identification and Assessment of Alternate Scenarios and Selection of 
Recommendations: 

The Intelligence Joint Cross-Service Group developed 13 scenarios, 
which after further analysis led to 6 candidate recommendations being 
presented to the Infrastructure Steering Group and the Infrastructure 
Executive Council, the latter of which approved 3 candidate 
recommendations. One of these 3 approved candidate recommendations was 
subsequently incorporated into a recommendation proposed by the 
headquarters group. 

Some scenarios were eliminated because they were alternatives to a 
proposed recommendation. Other scenarios were eliminated because of 
concerns over high implementation costs and long payback periods--that 
is, the length of time required for the savings to offset closure 
costs. For example, the group developed a scenario to establish 
selected continuity of operations and mission assurance functions at 
White Sands Missile Range, New Mexico, but it was disapproved by the 
Infrastructure Executive Council because it had a one-time cost of $1.8 
billion and a projected payback period of never. 

Recommendations Approved by DOD: 

The Intelligence Joint Cross-Service Group projects that its two 
recommendations will produce almost $588 million in 20-year net present 
value savings, and almost $138 million in net annual recurring savings. 
Table 32 below provides a summary of the financial aspects of the 
group's recommendations. 

Table 32: Financial Aspects of the Intelligence Joint Cross-Service 
Group's Recommendations: 

Fiscal year 2005 constant dollars in millions. 

Recommended action: Close National Geospatial-Intelligence Agency 
leased locations, relocate to Fort Belvoir, VA; 
DOD report page: Int-4; 
One-time (costs): ($1,117.3); 
Net: implementation: (costs) savings[A]: ($796.7); 
Net annual recurring savings: $127.7; 
Payback: period: (years): 8 years; 
20-year net present: value savings[B]: $535.1. 

Recommended action: Realign Defense Intelligence Agency functions; 
DOD report page: Int-3; 
One-time (costs): ($96.7); 
Net: implementation: (costs) savings[A]: ($48.8); 
Net annual recurring savings: $10.1; 
Payback: period: (years): 8 years; 
20-year net present: value savings[B]: $52.8. 

Total; 
One-time (costs): ($1,214.0); 
Net: implementation: (costs) savings[A]: ($845.5); 
Net annual recurring savings: $137.8; 
20-year net present: value savings[B]: $587.9. 

Source: GAO analysis of DOD data. 

[A] This represents net costs or savings within the 6-year 
implementation period required to implement BRAC recommendations. 

[B] DOD used a 2.8 percent discount rate to calculate net present 
value. 

[End of table]

The majority of the net annual recurring savings in the two 
recommendations is from the avoidance of future leased cost when 
activities move from leased space to military installations. 
Intelligence Joint Cross-Service Group officials noted that about one-
half of the estimated $1.1 billion one-time costs for the National 
Geospatial-Intelligence Agency move will be paid from National 
Intelligence Program funds. 

Issue Identified with Approved Recommendations: 

The recommendation to move the National Geospatial-Intelligence Agency 
from various leased sites to Fort Belvoir, Virginia, will have a 
significant impact on the local community when added to other proposals 
to move activities to Fort Belvoir.[Footnote 126] This one proposal 
would move about 8,500 personnel to Fort Belvoir from Bethesda, 
Maryland, Washington, DC and the northern Virginia area. The BRAC 
Commission may wish to consider the impact on the local community 
infrastructure, such as roads and public transportation, when 
evaluating this and other proposals affecting Fort Belvoir. 

[End of section]

Appendix X: Medical Joint Cross-Service Group Selection Process and 
Recommendations: 

The Medical Joint Cross-Service Group followed the common analytical 
framework established by the Office of the Secretary of Defense (OSD) 
for reviewing the military health care system. It produced 22 candidate 
recommendations; one was disapproved late in the process by the 
Infrastructure Executive Council (IEC), and one was integrated with a 
service recommendation. The remaining 20 recommendations were combined 
into 6 recommendations that were ultimately approved by DOD. These 6 
recommendations are projected to produce about $2.7 billion in 
estimated net present value savings over a 20-year period. The expected 
payback period, or length of time for the savings to offset costs 
associated with the recommendations, varies from immediately to 10 
years. We have identified various issues regarding the recommendations 
that may warrant further attention by the BRAC Commission. These 
include the likelihood that some estimated savings could be less than 
projected, lengthy or no payback periods for certain proposed actions 
embedded within the more complex recommendations, and uncertainties 
about future requirements and their impact on the viability of the 
recommendations. While the group encountered some challenges in 
obtaining accurate and consistent certified data on a cross-service 
basis, the DOD Inspector General and the military service audit 
agencies ultimately concluded that the data used by the medical group 
were sufficiently reliable for use in the BRAC process. 

Organization and Focus: 

The medical group was chaired by the Surgeon General of the Air Force 
and included the Surgeon General of the Navy, the Deputy Surgeon 
General of the Army, the Medical Officer of the Marine Corps, and the 
Acting Deputy Assistant Secretary for Health Budgets and Financial 
Policy. In carrying out its BRAC analyses, the medical group 
established functional area working groups and subgroups consisting of 
subject matter experts and analysts from each of the military services 
and the OSD Health Affairs.[Footnote 127] The group's objectives were 
to develop recommendations to: 

* support the warfighters and their families,

* maximize military value while reducing infrastructure and maintaining 
an adequate surge capability,

* maintain and improve access to care for all beneficiaries, including 
military retirees,

* enhance jointness,

* identify and maximize synergies from co-location or consolidation, 
and: 

* examine outsourcing opportunities, such as increasing the use of 
civilian care providers, to allow DOD to leverage its efforts across 
the overall United States health care system. 

Framework for Analysis: 

The medical group organized and conducted its BRAC analyses of DOD's 
military health care system focusing on three broad functions: (1) 
health care services; (2) health care education and training; and (3) 
medical and dental research, development, and acquisition. As with 
other military services and joint cross-service groups, capacity and 
military value analyses were the starting points for the group's 
analyses. The DOD Inspector General and service audit agencies 
performed an important role in ensuring the accuracy of data used in 
these analyses through extensive audits of data gathered at various 
locations. 

Capacity Analysis: 

In establishing the analytical framework for developing its 
recommendations, the medical group analyzed the military health 
system's capacity in terms of services, workloads, and facilities. The 
group developed specific functional area metrics for measuring capacity 
and collected certified data associated with these metrics from 
military installations across the country. It used a range of metrics, 
depending on the functional area being assessed, such as military 
health care population and workloads, number of hospital beds, 
available and currently used building space, length and frequency of 
education and training programs, personnel requirements, and equipment 
usage, to measure capacity. 

Based on the group's capacity analysis, the military health system was 
found to have excess capacity within two of the three functional areas 
it reviewed. As shown in table 33, the excess capacity resides 
predominantly in the health care services and education and training 
functions. Within the health care services function, the analysis 
showed that dental care has virtually no excess capacity because of the 
use of contract providers and substantial infrastructure adjustments 
since previous BRAC rounds. The group's capacity analysis report 
acknowledged that even though adjustments have been made to the health 
care system since the BRAC 1995 round, the medical system 
infrastructure is still generally based on a Cold War strategy with 
minimal reliance on civilian health care providers. 

Table 33: Excess Capacity Identified by the Medical Joint Cross-Service 
Group: 

Functional areas[A]: Health care services: Health care-primary care; 
Percentage of excess capacity: 38%. 

Functional areas[A]: Health care services: Health care-specialty care; 
Percentage of excess capacity: 14%. 

Functional areas[A]: Health care services: Health care inpatient; 
Percentage of excess capacity: 48%. 

Functional areas[A]: Health care services: Health care dental; 
Percentage of excess capacity: 0%. 

Functional areas[A]: Health care education and training: Laboratories; 
Percentage of excess capacity: 77%. 

Functional areas[A]: Health care education and training: Clinical; 
Percentage of excess capacity: 15%. 

Functional areas[A]: Health care education and training: Classrooms; 
Percentage of excess capacity: 56%. 

Functional areas[A]: Health care research, development, and 
acquisition: Personnel; 
Percentage of excess capacity: 3%. 

Source: Medical Joint Cross-Service Group data. 

[A] A variety of metrics was used depending on the functional areas 
being assessed. For example, the number of procedures was used for 
assessing health care services while the number of full-time 
equivalents was used in assessing health care research, development, 
and acquisition functions. 

[End of table]

The group developed surge factors for its analysis of inpatient and 
research, development, and acquisition functions, which are part of the 
percentages in table 33. It determined that the high operational tempo 
would be maintained for 30 days. However, the group determined that 
surge factors were not necessary for other functional areas because of 
their inherent surge capabilities to handle potential workload 
increases. It assumed that potential workload surge requirements could 
be handled through various sources, such as the use of civilian 
providers in the TRICARE network,[Footnote 128] civilian medical 
education and training programs, and extended operations. 

According to DOD medical officials, the Department of Health and Human 
Services, rather than DOD, is responsible for domestic homeland medical 
support, but defense medical personnel and infrastructure could be used 
to assist in handling domestic medical emergency situations. According 
to DOD officials, since this support is not part of DOD's defined 
mission, it was not included in the medical group's analysis. However, 
DOD officials also told us that the Joint Chiefs of Staff and the OSD 
had coordinated the BRAC analysis with major commands that would be 
impacted by BRAC proposals, including the U.S. Northern Command, which 
is responsible for the homeland defense mission. 

DOD is in the process of reviewing the military health care system's 
ability to meet future medical readiness requirements, including an 
evaluation of medical infrastructure at various levels of operations 
from contingencies to full operational surges. DOD intends to include 
Department of Homeland Security policies in this review. According to 
DOD officials, the results of this ongoing assessment were not included 
in the medical group's capacity analysis because the assessment is not 
expected to be completed until after the BRAC recommendations are 
finalized, following reviews by the BRAC Commission, the President, and 
Congress. Nevertheless, the medical group made a determination that the 
current medical force size[Footnote 129] was adequate to meet the 
requirements of various war plans, and after reviewing the fiscal year 
2006 program objective memorandum and the 20-year force structure plan, 
it decided to use the current force structure for its analysis. 
Further, the group concluded that deployment force sizing, a readiness 
issue, did not have direct influence on determining excess facility 
capacity. 

The medical group estimates that its recommendations, if adopted, would 
result in a 12 percent reduction in excess inpatient medical capacity 
and an approximately 7.4 million square feet net reduction in overall 
facility space. 

Military Value Analysis: 

The medical group's assessment of military value, like its excess 
capacity assessment, focused on the same three functional areas: (1) 
health care services; (2) health care education and training; and (3) 
medical and dental research, development, and acquisition. 

The military value analysis helped to establish the basis for 
realigning medical functions across the various installations or 
closing specific activities within the medical infrastructure. It also 
helped to gauge the impact of the group's proposed scenarios on the 
overall DOD health care system. The military value methodology for this 
BRAC round was similar, in many respects, to the one used in the 1995 
round, especially for medical functions. For example, both rounds 
identified affected populations and local civilian providers within 
catchment areas.[Footnote 130] In both rounds, military value played a 
predominant role in formulating recommendations. Moreover, during the 
2005 round, the medical group considered the impact on local 
beneficiaries, such as military retirees, from downsizing or 
eliminating medical facilities, which included input from a DOD-
chartered military health benefit working group.[Footnote 131] This 
working group included independent members who represented TRICARE 
regions throughout the United States. 

The medical group's functional military value analysis assessed the 
relative capabilities of various activities and facilities supporting 
the military health care system's mission and operational needs. Its 
military value analysis was directly linked to the four military value 
criteria required by the BRAC legislation. For example, the military 
value analysis gave greater weight to services supporting active duty 
members in order to emphasize force readiness. Table 34 shows the 
relative weights that the group developed for each of the four 
selection criteria that relate to military value. 

Table 34: Medical Joint Cross-Service Group Military Value Criteria 
Weights: 

Figures in percentages. 

Military value criteria: 1. The current and future mission capabilities 
and the impact on operational readiness of the total force of the 
Department of Defense, including the impact on joint warfighting, 
training, and readiness; 
Health care services weight: 45%; 
Health care education and training weight: 45%; 
Medical and dental research, development, and acquisition weight: 55%. 

Military value criteria: 2. The availability and condition of land, 
facilities, and associated airspace (including training areas suitable 
for maneuver by ground, naval, or air forces throughout a 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; 
Health care services weight: 25%; 
Health care education and training weight: 20%; 
Medical and dental research, development, and acquisition weight: 5%. 

Military value criteria: 3. The ability to accommodate contingency, 
mobilization, surge, and future total force requirements at both 
existing and potential receiving locations to support operations and 
training; 
Health care services weight: 10%; 
Health care education and training weight: 25%; 
Medical and dental research, development, and acquisition weight: 23%. 

Military value criteria: 4. The cost of operations and the manpower 
implications; 
Health care services weight: 20%; 
Health care education and training weight: 10%; 
Medical and dental research, development, and acquisition weight: 17. 

Total; 
Health care services weight: 100%; 
Health care education and training weight: 100%; 
Medical and dental research, development, and acquisition weight: 100. 

Source: DOD and Medical Joint Cross-Service Group. 

Note: The system of weights provided a basis for assigning relative 
value to data collected and tabulated across each military value 
dimension. 

[End of table]

In developing its analysis in accordance with the criteria above, the 
group developed specific functional area attributes, metrics, and data 
call questions to assist in assessing military value. Figure 17 
provides an example of such analysis for the health care services 
functional area and its linkage to the BRAC legislation. 

Figure 17: Selected Attributes, Metrics, and Data Questions Used to 
Assess Military Value of Health Care Services: 

[See PDF for image] 

[A] The BRAC military value criteria are the first four BRAC selection 
criteria. 

[B] Military value attributes are characteristics of each criterion. 
The medical group used a total of six military value attributes in its 
health care services functional area analysis. 

[C] Military value metrics are measures for the attributes. The medical 
group used a total of 16 military value metrics in its military value 
analysis of health care services functions. 

[D] The medical group used a total of 24 data call questions in its 
health care services military value analysis. 

[End of figure] 

DOD Inspector General's and Service Audit Agencies' Roles in the 
Process: 

The DOD Inspector General and the service audit agencies played 
important roles in ensuring that the data used in the medical group's 
analyses were certified and properly supported. The involvement of 
these audit groups included validation of data submitted by the 
military services, compliance with data certification requirements, the 
integrity of the group's databases, accuracy of the analytical process 
in terms of calculations, and the adequacy of supporting documentation. 
These audit groups conducted extensive audits of the data collected 
from the military installations, and in some instances data 
discrepancies were identified for follow-on corrective actions. While 
the process for detecting and correcting data errors was quite lengthy, 
the DOD Inspector General and audit agencies determined that the 
medical-related data were sufficiently reliable for use in the BRAC 
process. 

Identification and Assessment of Alternate Scenarios and Selection of 
Recommendations: 

The medical group's study objectives, military judgment, and capacity 
and military value analyses helped to identify closure and realignment 
scenarios for consideration. Identification and evaluation of scenarios 
was also facilitated by use of an optimization model to identify 
recommendations that could aid in optimizing medical health care 
workloads and infrastructure.[Footnote 132] The group also developed 
scenarios that included establishing a minimum level of average daily 
patient workload for inpatient facilities and by reducing excess 
capacity in multiservice markets to achieve efficiencies.[Footnote 133] 
It also used the Cost of Base Realignment Actions (COBRA) model to 
estimate the potential net costs or savings for its scenario proposals. 
The group also considered the scenarios' impact on the local economy, 
the DOD medical beneficiary population and graduate medical education 
requirements, and the environment. 

The medical group submitted 22 recommendations to the IEC, which 
disapproved one of the recommendations--the proposal to close the 
Uniformed Services University of the Health Sciences at Bethesda, 
Maryland. This matter is discussed further in the next section of this 
appendix. Further, another recommendation was integrated with a service 
realignment and closure action. The remaining 20 recommendations were 
combined into 6 recommendations that were ultimately approved by DOD. 

Recommendations Approved by DOD: 

The group produced 6 recommendations which they reported will yield an 
estimated $2.7 billion in 20-year net present value savings and $412 
million in net annual recurring savings. Table 35 below provides a 
summary of the financial aspects of the group's recommendations. 
However, the group acknowledges that it incorrectly reported certain 
financial data for its recommendation involving the Walter Reed Army 
Medical Center. Based on our analysis, the revised estimates are shown 
as a note to table 35. 

Table 35: Financial Aspects of the Medical Joint Cross-Service Group's 
Recommendations: 

Fiscal year 2005 constant dollars in millions. 

Recommended action: Close Brooks City-Base, San Antonio, TX, by 
relocating functions to Randolph Air Force Base, Wright-Patterson Air 
Force Base, Lackland Air Force Base, Fort Sam Houston, and Aberdeen 
Proving Ground; 
DOD report page: Med-6; 
One-time (costs): ($325.3); 
Net implementation: (costs) or savings[A]: ($45.9); 
Net annual recurring (costs) or savings: $102.1; 
Payback period (years): 2; 
20-year net present value (costs) or savings[B]: $940.7. 

Recommended action: Realign various activities by converting inpatient 
services to clinics at Marine Corps Air Station Cherry Point, Fort 
Eustis, U.S. Air Force Academy, Andrews Air Force Base, MacDill Air 
Force Base, Keesler Air Force Base, Scott Air Force Base, Naval Station 
Great Lakes, and Fort Knox; 
DOD report page: Med-12; 
One-time (costs): ($12.9); 
Net implementation: (costs) or savings[A]: $250.9; 
Net annual recurring (costs) or savings: $60.2; 
Payback period (years): immediate; 
20-year net present value (costs) or savings[B]: $818.1. 

Recommended action: Establish San Antonio Regional Medical Center at 
Fort Sam Houston, Brooke Army Medical Center; and realign basic and 
specialty enlisted medical training to Fort Sam Houston; 
DOD report page: Med-10; 
One-time (costs): ($1,040.9); 
Net implementation: (costs) or savings[A]: ($826.7); 
Net annual recurring (costs) or savings: $129.0; 
Payback period (years): 10; 
20-year net present value (costs) or savings[B]: $476.2. 

Recommended action: Realign Walter Reed Army Medical Center (all 
tertiary care to Bethesda National Naval Medical Center and primary and 
specialty care to Fort Belvoir)[C]; 
DOD report page: Med-4; 
One-time (costs): ($988.8); 
Net implementation: (costs) or savings[A]: ($724.2); 
Net annual recurring (costs) or savings: $99.6; 
Payback period (years): 10; 
20-year net present value (costs) or savings[B]: $301.2. 

Recommended action: Realign McChord Air Force Base by relocating all 
medical functions to Fort Lewis; 
DOD report page: Med-9; 
One-time (costs): ($1.1); 
Net implementation: (costs) or savings[A]: $55.1; 
Net annual recurring (costs) or savings: $11.6; 
Payback period (years): immediate; 
20-year net present value (costs) or savings[B]: $164.4. 

Recommended action: Realign various activities to create joint centers 
of excellence for chemical, biological, and medical research, 
development, and acquisition (at Fort Sam Houston, Walter Reed Army 
Medical Center--Forrest Glen Annex, Wright-Patterson Air Force Base, 
Fort Detrick, and Aberdeen Proving Ground); 
DOD report page: Med-15; 
One-time (costs): ($73.9); 
Net implementation: (costs) or savings[A]: ($45.9); 
Net annual recurring (costs) or savings: $9.2; 
Payback period (years): 7; 
20-year net present value (costs) or savings[B]: $46.0. 

Recommended action: Total; 
One-time (costs): ($2,442.9); 
Net implementation: (costs) or savings[A]: ($1,336.7); 
Net annual recurring (costs) or savings: $411.7; 
20-year net present value (costs) or savings[B]: $2,746.6. 

Source: GAO analysis of DOD data. 

[A] This represents net costs or savings within the 6-year 
implementation period required to implement BRAC recommendations. 

[B] DOD used a 2.8 percent discount rate to calculate net present 
value. 

[C] The medical group acknowledges inaccuracies in calculating its 
reported estimates. Our analysis indicates that the revised estimated 
net annual recurring savings are about $145 million, the payback year 
is 6 years, and the 20-year net present value savings is about $831 
million. 

[End of table]

The payback period, or length of time for the savings to offset 
implementation costs for these recommendations, ranged from immediately 
to 10 years. Four of the six recommendations are expected to result in 
nearly all of the expected savings--over 90 percent of the total 
estimated 20-year net present value savings of about $2.7 billion, and 
of the net annual recurring savings of about $411.7 million. Two of the 
six recommendations have high one-time upfront costs--about $2 billion, 
or over 80 percent of the total one-time costs for the six 
recommendations. 

Two multiservice market area recommendations--the establishment of the 
San Antonio Regional Medical Center in Texas and realignment of the 
Walter Reed Army Medical Center in Washington, D.C.--are ultimately 
expected to (1) produce over 50 percent of the net annual recurring 
savings and (2) incur most of the up-front costs for the 
recommendations as a whole. The group's primary motivation for these 
recommendations was to transform the existing medical infrastructure 
into premier modernized joint operational medical centers. In the case 
of the Walter Reed Medical Center recommendation, the group also 
justified the recommendation based on a shift in the beneficiary 
population from the northern tier of the Washington, D.C., area to the 
southern tier near Fort Belvoir, Virginia. 

Another recommendation with substantial estimated net annual recurring 
savings is the closure of the Brooks City-Base in Texas, which is 
projected to achieve efficiencies in research, development, and 
acquisition by relocating similar functions to a single location. 
However, as discussed below, a significant portion of the savings from 
this as well as other recommendations involve claimed military 
personnel savings, which are somewhat uncertain. The recommendation 
that involves the downsizing of inpatient facilities at nine locations 
is expected to achieve efficiencies and reduce personnel as well as 
provide enhanced training opportunities for medical personnel 
transferring to other locations. 

The medical group included within its recommendations various 
realignments that were described or partially justified as promoting 
jointness, such as those in the centers of excellence for chemical, 
biological, and medical research, development, and acquisition. Our 
review of the documentation showed that the supporting analysis was not 
always clear with respect to how these actions would result in 
jointness. For example, the group anticipated that jointness would 
emerge from recommendations that co-located but did not integrate 
research, development, and acquisition functions among services at an 
installation. It appears that they primarily will result in the co-
locating of similar military services' functional areas rather than 
creating integrated joint medical operations with joint management 
structures. However, according to a DOD official, the co-location of 
military services with similar functions on a base will help foster 
jointness in the long term. Based on our analysis, it is not obvious 
whether some of these proposed realignments will truly result in joint 
military operations. 

Issues Identified with Recommendations: 

Time did not permit us to assess the operational impact of each of the 
medical group's recommendations, particularly where operations proposed 
for consolidations or realignments extend across functional areas, 
geographical areas, or both. At the same time, we offer a number of 
broad-based observations about some of the proposed recommendations as 
they relate to military medical personnel savings, payback periods, 
jointness, and medical wartime requirements that may warrant further 
review by the BRAC Commission. 

Military Medical Personnel Savings: 

Our analysis shows that military personnel savings account for about 
$201 million or nearly 50 percent of the group's estimated net annual 
recurring savings. However, the amount of projected dollar savings is 
uncertain because the medical group indicated that reductions in end 
strength are not planned. Indirectly, some savings could occur based on 
the group's expectation that medical personnel would be reassigned on 
an individual basis to specific and varied locations, depending on 
where the need exists for military medical specialists. In some cases, 
the group noted that these military personnel reassignments could 
displace civilian and/or contractor medical providers. When or to what 
extent these reallocations would occur has not yet been determined. At 
the time of the group's analysis, these specific moves had not been 
identified and thus the group did not estimate costs related to such 
potential moves in its cost and savings analysis. 

Bundling of Recommendations: 

Some of the earlier proposed recommendations with lengthy or no payback 
periods were integrated with ones having shorter paybacks, therefore 
concealing the amount of time it would take for the savings to offset 
costs. For example, the group developed a stand alone recommendation co-
locating initial enlisted medical education and training to Fort Sam 
Houston, Texas, which, by itself, had a payback period of 21 years. 
However, the group later bundled it with the recommendation 
establishing the San Antonio Regional Medical Center that downsized 
inpatient care at Lackland Air Force Base also in Texas and expanded 
medical facilities at nearby Fort Sam Houston. This recommendation had 
a payback period of 11 years. When the two recommendations were 
combined, the payback period was determined to be 10 years. The common 
linkage of the two recommendations is location, with the expectation 
that the enlisted medics will benefit from the location of the Brooke 
Army Medical Center in Texas, which has a trauma center suited for 
combat casualty training. Another example is the initial realignment of 
medical research, development, and acquisition functions at Brooks City-
Base, which had no payback before DOD combined this recommendation with 
other related recommendations to close the base. 

Future Wartime Medical Requirements: 

DOD's ongoing assessment of its future wartime medical requirements, as 
mentioned earlier, will not be completed until after BRAC decisions are 
finalized, following reviews by the BRAC Commission, the President, and 
Congress; therefore, this assessment was not included in the medical 
group's analysis. Without having such requirements available during the 
BRAC process, it is difficult for DOD to identify the appropriate 
medical infrastructure changes that are needed or to determine the 
appropriate size of the military health care system. Also, the group 
recognized that medical operations are changing with casualties rapidly 
moved to medical facilities outside the theater of operations and that 
these changes may affect the future sizing of medical forces. 

Nevertheless, the group expressed belief that the current medical force 
size was adequate to meet the requirements of the various war plans 
despite the group's recommendations that will reduce system-wide excess 
inpatient capacity by 622 beds. 

Use of Veterans' Hospitals: 

While the medical group examined the capacity and proximity of 
Department of Veterans Affairs' (VA) hospitals to existing military 
medical facilities in its analysis, it did not coordinate with VA to 
determine whether military beneficiaries who normally receive care at 
military medical facilities could also receive care at VA hospitals in 
the vicinity. During the scenario development phase, the group intended 
to develop a recommendation for a partnership involving VA facilities, 
but group officials noted that the BRAC nondisclosure agreements and 
the need to negotiate costs under such a partnership made it difficult 
to seriously plan for VA involvement prior to the announcement of the 
recommendations. However, a DOD official told us that during the BRAC 
implementation phase, negotiations with VA at the local levels are 
possible regarding the potential use of its services for military 
beneficiaries in various locations, especially those locations where 
DOD intends to eliminate inpatient care in existing medical 
facilities.[Footnote 134] While the official told us that VA 
involvement had the potential for providing services and benefiting the 
department, another official added that the group's analysis indicated 
that sufficient capacity exists, without VA support, within the private 
sector to accommodate military beneficiaries in those locations where 
inpatient care at the military facilities is being eliminated. However, 
we were unable to verify the results of this analysis because the group 
did not fully document its analysis. 

Closure of the Uniformed Services University of the Health Sciences 
Rejected by IEC: 

The medical group had initially developed a candidate recommendation to 
close DOD's medical school, known as the Uniformed Services University 
of the Health Sciences, which is located on the grounds of the National 
Naval Medical Center in Bethesda, Maryland.[Footnote 135] The group had 
concluded that it was more costly than alternative scholarship 
programs, and that the department could rely on civilian universities 
to educate military physicians. The group projected the closure will 
yield net annual recurring savings of about $58 million, and 20-year 
net present value savings of approximately $575 million. In a series of 
reports from 1995 through 2000, we also concluded at the time that the 
university was a more costly way to educate military 
physicians.[Footnote 136]

However, late in the deliberative process, the IEC rejected this 
candidate recommendation citing education as a core competency for the 
department and therefore it was considered too risky to rely on the 
private sector to provide this function. A DOD official indicated that 
with the recommendation to realign Walter Reed Army Medical Center to 
Bethesda, Maryland, it would be highly desirable to have a military 
medical college associated with this medical facility in order for it 
to be a world-class medical center. According to another official, DOD 
will need to make investments in the university in order to elevate its 
status and attract leading medical scholars who could make the 
university more competitive. 

[End of section]

Appendix XI: Supply and Storage Joint Cross-Service Group Selection 
Process and Recommendations: 

The Supply and Storage Joint Cross-Service Group followed the common 
analytical framework established by the Office of the Secretary of 
Defense (OSD) for reviewing the supply, storage, and distribution 
system within DOD. The group initially produced five recommendations 
that were presented to the Infrastructure Steering Group (ISG) and the 
Infrastructure Executive Council (IEC). Three of the five 
recommendations were merged into one recommendation by the IEC. If 
adopted, the three approved recommendations are projected to generate 
about $5.6 billion in estimated 20-year net present value savings and 
$406 million in net annual recurring savings for the department with an 
immediate payback (i.e., time required to recoup up-front investment 
costs) on the cost of implementing these recommendations. While the 
number of recommendations is small, each encompasses multiple 
realignment actions of workloads affecting many locations. Our analysis 
shows that the anticipated savings would result primarily from business 
process reengineering--expanded use of performance-based 
logistics[Footnote 137]--, infrastructure and inventory reductions, and 
reduced civilian personnel costs. We identified a number of issues 
associated with several recommendations that may warrant additional 
attention by the BRAC Commission. The group encountered some challenges 
in obtaining accurate and consistent certified data, but the DOD 
Inspector General and the military service audit agencies, which 
performed audits of the data, ultimately concluded that the data were 
sufficiently reliable for use during the BRAC process. 

Organization and Focus: 

The supply and storage group consisted of six senior-level principal 
members from the logistics directorates for each service, the Defense 
Logistics Agency (DLA), and the Joint Chiefs of Staff, and was 
supported by staff from these organizations.[Footnote 138] The 
Director, DLA, chaired the group, following the retirement of the 
original chairman from the Joint Staff. The group's overarching goal 
was to identify potential closures, realignments, or both that would 
enhance economies and efficiencies in operations as traditional 
military forces and logistics processes become more joint and 
increasingly take on expeditionary characteristics. 

Framework for Analysis: 

The group organized its BRAC efforts around the three core logistics 
functions of supply, storage, and distribution. These functions are 
inherent in the military services' operations as well as for DLA, whose 
mission is to provide wholesale-level support in these functions for 
the services in common supply classes. In collecting and analyzing data 
to formulate its recommendations, the group sought to assess the supply 
and storage infrastructure in the following four distinct activity 
areas: (1) military service and DLA inventory control points (2) 
defense distribution depots, (3) defense reutilization and marketing 
offices and (4) other activities such as installation-level supply 
operations. As with other military services and joint cross-service 
groups, capacity and military value analyses served as starting points 
for the group's analyses. While the group initially tried to analyze 
both the wholesale[Footnote 139] and retail supply and storage 
activities, it later terminated most retail-level efforts because of 
difficulties in collecting reliable data and a desire by the group's 
principals to not impact the retail support to operational and other 
deploying units. The DOD Inspector General and service audit agencies 
performed an important role in ensuring the accuracy of data used in 
these analyses through extensive audits of data gathered at various 
locations. 

Capacity Analysis: 

To form the basis for its analysis, the group developed metrics in each 
of the functional areas (supply, storage, and distribution) to measure 
capacity and subsequently sought to collect certified data linked to 
these metrics from various defense activities whose missions resided 
within these functional categories. The group developed 14 separate 
reporting metrics within these categories that included, for example, 
special indoor storage space and technical labor work hours, and 
measured excess capacity under normal demand as well as under surge 
conditions of 10 and 20 percent. Because of its general inability to 
collect reliable retail-level data and a desire not to impact 
operational support to deploying units whose support comes from the 
retail area, the group dropped this area, with one exception,[Footnote 
140] from further consideration in the succeeding analyses leading to 
recommended actions. 

The group's capacity analysis showed that excess capacity[Footnote 141] 
exists, even when surge factors were considered, within three of the 
four supply and storage activity areas it examined. As shown in table 
36, the excesses ranged from 20 percent to 75 percent under normal 
demand conditions across various capacity metrics in the functional 
areas, with the excesses somewhat less under surge conditions. 

Table 36: Excess Capacity Identified by the Supply and Storage Joint 
Cross-Service Group: 

Functional/activity category: Supply/inventory control points: 

Capacity metric: Purchasing labor (FTE)[A]; 
Percentage of excess capacity: Normal demand: 29%; 
Percentage of excess capacity: 10 percent surge: 22%; 
Percentage of excess capacity: 20 percent surge: 14%. 

Capacity metric: Supply labor (FTE); 
Percentage of excess capacity: Normal demand: 35%; 
Percentage of excess capacity: 10 percent surge: 29%; 
Percentage of excess capacity: 20 percent surge: 22%. 

Capacity metric: Technical labor (FTE); 
Percentage of excess capacity: Normal demand: 75%; 
Percentage of excess capacity: 10 percent surge: 72%; 
Percentage of excess capacity: 20 percent surge: 69%. 

Capacity metric: Work space (square feet); 
Percentage of excess capacity: Normal demand: 47%; 
Percentage of excess capacity: 10 percent surge: 42%; 
Percentage of excess capacity: 20 percent surge: 37%. 

Functional/activity category: Storage and distribution/defense 
distribution depots: 

Capacity metric: Regular covered storage (cubic feet); 
Percentage of excess capacity: Normal demand: 32%; 
Percentage of excess capacity: 10 percent surge: 25%; 
Percentage of excess capacity: 20 percent surge: 19%. 

Capacity metric: Special covered storage (cubic feet); 
Percentage of excess capacity: Normal demand: 37%; 
Percentage of excess capacity: 10 percent surge: 31%; 
Percentage of excess capacity: 20 percent surge: 24%. 

Capacity metric: Open storage (square feet); 
Percentage of excess capacity: Normal demand: 43%; 
Percentage of excess capacity: 10 percent surge: 38%; 
Percentage of excess capacity: 20 percent surge: 32%. 

Capacity metric: Distribution capacity (number of loading bays); 
Percentage of excess capacity: Normal demand: 39%; 
Percentage of excess capacity: 10 percent surge: 33%; 
Percentage of excess capacity: 20 percent surge: 27%. 

Functional/activity category: Supply and storage/defense reutilization 
and marketing offices: 

Capacity metric: Wage grade labor (FTE); 
Percentage of excess capacity: Normal demand: 46%; 
Percentage of excess capacity: 10 percent surge: 40%; 
Percentage of excess capacity: 20 percent surge: 35%. 

Capacity metric: Supply labor (FTE); 
Percentage of excess capacity: Normal demand: 40%; 
Percentage of excess capacity: 10 percent surge: 34%; 
Percentage of excess capacity: 20 percent surge: 28%. 

Capacity metric: Work space (square feet); 
Percentage of excess capacity: Normal demand: 53; 
Percentage of excess capacity: 10 percent surge: 48%; 
Percentage of excess capacity: 20 percent surge: 44%. 

Capacity metric: Regular covered storage (cubic feet); 
Percentage of excess capacity: Normal demand: 57%; 
Percentage of excess capacity: 10 percent surge: 52%; 
Percentage of excess capacity: 20 percent surge: 48%. 

Capacity metric: Special covered storage (cubic feet); 
Percentage of excess capacity: Normal demand: 20%; 
Percentage of excess capacity: 10 percent surge: 12%; 
Percentage of excess capacity: 20 percent surge: 4%. 

Capacity metric: Open storage (square feet); 
Percentage of excess capacity: Normal demand: 58%; 
Percentage of excess capacity: 10 percent surge: 54%; 
Percentage of excess capacity: 20 percent surge: 50%. 

Source: Supply and Storage Joint Cross-Service Group. 

[A] FTEs are full-time equivalents and are used as measures of work 
hours performed. One FTE is equivalent to 2,080 hours of work per year. 

[End of table]

According to the group's staff, its recommendation regarding 
restructuring of defense distribution depots, if approved and 
implemented, is expected to reduce current covered storage of about 51 
million square feet (both regular and special) by over 50 percent, or 
about 27 million square feet. In addition, the recommendation regarding 
inventory control points is expected to increase infrastructure by 
about 4,700 square feet because the inventory control points would be 
absorbing more space than they would be vacating. The group has no 
recommendations that would affect the capacity of DLA's defense 
marketing and reutilization offices. 

Military Value Analysis: 

The supply and storage group's assessment of military value, like its 
excess capacity assessment, focused on the same three core logistics 
functions of supply, storage, and distribution. By linking its military 
analysis directly to OSD's four military selection criteria required by 
the BRAC legislation, the group established a sound basis for 
developing its recommendations. As shown in table 37, the group 
developed a weighting system for the military value criteria with the 
first and third criteria having relatively larger weights, or 
importance, than the remaining two criteria. 

Table 37: Supply and Storage Joint Cross-Service Group Military Value 
Criteria Weights: 

Figures in percentages. 

Military value criteria: 1. The current and future mission capabilities 
and the impact on operational readiness of the total force of the 
Department of Defense, including impact on joint warfighting, training, 
and readiness; 35%. 

Military value criteria: 2. The availability and condition of land, 
facilities, and associated airspace in (including training areas 
suitable for maneuver by ground, naval, or air forces throughout a 
diversity of climate and terrain areas and staging areas for the use of 
the Armed Forces in homeland defense missions in) at both existing and 
potential receiving locations; 20%. 

Military value criteria: 3. The ability to accommodate contingency, 
mobilization, surge, and future total force requirements at both 
existing and potential receiving locations to support operations and 
training; 35%. 

Military value criteria: 4. The cost of operations and the manpower 
implications; 10%. 

Total; 100%. 

Source: DOD and Supply and Storage Joint-Cross-Service Group. 

Note: The system of weights provided a basis for assigning relative 
value to data collected and tabulated across each military value 
dimension. 

[End of table]

As with the capacity analysis, the group's assessment of military value 
included development of attributes and metrics in each of the core 
functional areas to measure military value, and it subsequently sought 
to collect certified data linked to these metrics from various defense 
activities whose missions resided within these categories. The group 
developed 55 individual metrics within the three functional areas, 
addressing information such as the percentage of demand for stocked 
items and cost of operations per person. The attributes and metrics 
were linked back to the military value selection criteria, as 
illustrated in figure 18. 

Figure 18: Selected Attributes, Metrics, and Data Questions Used to 
Assess Military Value of Supply and Storage Activities: 

[See PDF for image] 

[A] The BRAC military value criteria are the first four BRAC selection 
criteria. 

[B] Military value attributes are characteristics of each criterion. 
Four of 28 military value attributes used by the group. 

[C] Military value metrics are measures for the attributes. Four of 55 
military value metrics used by the group. 

[D] Four of 55 military value data call questions used by the group. 
Many of these questions have multiple parts. 

[End of figure] 

Using certified data collected during the BRAC process and applying the 
weighting system, the group developed military value scores and 
rankings for 16 inventory control points, 19 defense distribution 
depots, and 67 defense reutilization and marketing offices. As with the 
capacity analysis, the group was generally unable to develop sufficient 
reliable data at the retail level to complete a military value analysis 
at that level. In many respects, the military value methodology for 
this round was comparable to that used in the 1995 BRAC round, 
particularly for DLA activities. In both BRAC rounds, the military 
value ranking of an activity played a predominant role in formulating 
recommendations. 

DOD Inspector General's and Service Audit Agencies' Roles in the 
Process: 

The DOD Inspector General and the service audit agencies played 
important roles in helping to ensure that the data used in the group's 
data analyses were certified and properly supported and that decision-
making models (e.g., military value and optimization) were logically 
designed and operating as intended. Through extensive audits of the 
data collected from field activities during the process, these audit 
agencies notified the group when they identified data discrepancies for 
follow-on corrective action. While the process for detecting and 
correcting data errors was quite lengthy and challenging, the audit 
agencies ultimately deemed the supply and storage-related data to be 
sufficiently reliable for use in the BRAC process. 

Identification and Assessment of Alternate Scenarios and Selection of 
Recommendations: 

The Supply and Storage Joint Cross-Service Group did not have accurate 
and complete capacity and military value data when it initially started 
developing potential closure and realignment scenarios and, therefore, 
had to rely on incomplete data, as well as military judgment based on 
the group's collective knowledge of the supply and storage area, to 
formulate its initial closure and realignment scenarios for evaluation. 
Although the data improved as additional information was requested and 
received from field locations, the lack of usable data initially 
limited the use of an optimization model to help identify and analyze 
scenarios. As time progressed, however, the group obtained the needed 
data, for the most part, to inform and support its scenarios. The DOD 
Inspector General validated the data. The group also focused on a 
number of OSD supplied transformational options, as outlined below, to 
guide its efforts in the recommendation development process: 

* Establishing a consolidated multi-service supply, storage, and 
distribution system focused on creating joint activities in areas with 
heavy DOD concentration. 

* Privatizing the wholesale storage and distribution processes. 

* Migrating oversight and management of all service depot-level 
reparables to a single DOD agency/activity.[Footnote 142]

* Establishing a single inventory control point within each service or 
consolidate into a joint activity. 

* Examining the effect of reducing functions by 20, 30, and 40 percent 
from the existing baseline, or reducing excess capacity by an 
additional 5 percent beyond the analyzed excess capacity. 

The group developed a total of 51 scenarios based on these 
transformational options. With the maturation of the data and the 
application of the COBRA model to estimate costs and savings, along 
with military judgment, the group was able to narrow its proposals to 
five candidate recommendations that were forwarded to the ISG and 
ultimately approved by the IEC. Further integration of three of these 
recommendations into a single recommendation left the group with three 
approved recommendations. 

Recommendations Approved by DOD: 

The group's recommendations are projected to produce substantial 
savings--about $406 million in estimated net annual recurring savings 
and about $5.6 billion in estimated net present value savings for DOD 
over the next 20 years. All are realignment actions, even though one of 
the recommended actions will close two defense distribution depots at 
Columbus, Ohio, and Texarkana, Texas and another one will close four 
inventory control points at Fort Huachuca, Arizona; Fort Monmouth, New 
Jersey; Rock Island, Illinois; and Lackland Air Force Base, Texas, 
while, at the same time, opening a new one at Aberdeen Proving Ground, 
Maryland. The group's recommendations also helped facilitate the 
closures of Fort Monmouth, New Jersey, and Red River Army Depot, Texas, 
both of which are reported in the Army's BRAC report. Table 38 provides 
a summary of the financial aspects of the group's three DOD-approved 
recommendations. 

Table 38: Financial Aspects of the Supply and Storage Joint Cross-
Service Group's Recommendations: 

Fiscal year 2005 constant dollars in millions. 

Recommendations: Realign supply, storage, and distribution management; 
DOD report page: S&S-13; 
One time (costs): ($192.7); 
Net implementation (costs) or savings[A]: $1,047.3; 
Net annual recurring (costs) or savings: $203.2; 
Payback period (years): immediate; 
20-year net present value (costs) or savings[B]: $2,925.8. 

Recommendations: Realign inventory control points and consolidate depot-
level reparable procurement management; 
DOD report page: S&S-7; 
One time (costs): ($127.0); 
Net implementation (costs) or savings[A]: $369.8; 
Net annual recurring (costs) or savings: $159.3; 
Payback period (years): immediate; 
20-year net present value (costs) or savings[B]: $1,889.6. 

Recommendations: Realign management of select commodities; 
DOD report page: S&S-5; 
One time (costs): (6.4); 
Net implementation (costs) or savings[A]: $333.7; 
Net annual recurring (costs) or savings: $43.8; 
Payback period (years): immediate; 
20-year net present value (costs) or savings[B]: $735.9. 

Total; 
One time (costs): ($326.1); 
Net implementation (costs) or savings[A]: $1,750.8; 
Net annual recurring (costs) or savings: $406.3; 
20-year net present value (costs) or savings[B]: $5,551.3. 

Source: GAO analysis of DOD data. 

[A] This represents net cost or savings within the 6-year 
implementation period required to implement BRAC recommendations. 

[B] DOD used a 2.8 percent discount rate to calculate net present 
value. 

[End of table]

Most of the projected net annual recurring savings--about $291 million 
or nearly 72 percent of the total--are expected to result from business 
process reengineering improvements in the form of expanded use of 
performance-based logistics and reductions to duplicate inventory. Most 
of the remaining net annual savings are expected to materialize from 
reductions to infrastructure costs at the wholesale supply and storage 
level (about $100 million annually) and from reductions in civilian 
personnel costs (about $68 million annually), with adjustments of about 
$54 million in annual recurring costs to reflect additional contract 
support costs. Further, the recommendations are expected to have 
immediate paybacks with relatively low up-front costs and savings over 
the 6-year implementation period. We believe that implementation of 
these recommendations could result in more efficient operations within 
DOD, and we consider the recommendation involving DLA management of the 
inventory control points and depot-level reparables to be 
transformational because it advances DOD's goal of having one DOD 
activity manage these activities, although, as discussed later, the 
full magnitude of savings likely to be realized is somewhat uncertain. 

The recommendation regarding the realignment of supply, storage, and 
distribution management creates four support regions across the 
country. Each region will have one strategic distribution site that 
will supply the region and multiple forward distribution points that 
will solely support industrial customers, such as maintenance depots, 
shipyards, and air logistics centers. The strategic distribution sites 
are located at Susquehanna, Pennsylvania; Warner Robins, Georgia; 
Oklahoma City, Oklahoma; and San Joaquin, California. It is also 
designed to realign service retail supply and storage functions along 
with personnel and infrastructure for these industrial customers in an 
"in-place, no-cost transfer" to DLA. This recommendation supports the 
closures of the defense distribution depots at Columbus, Ohio, and 
Texarkana, Texas, and realigns each of the remaining 17 defense 
distribution depots. 

The recommendation regarding the realignment of the inventory control 
points transfers certain inventory control point functions, such as 
contracting, budgeting and inventory management, to DLA and allows 
further consolidation of service and DLA inventory control points by 
the supply chains they manage.[Footnote 143] In addition, it supports 
the movement of the management of essentially all service consumable 
items[Footnote 144] and the procurement management and related support 
functions for the procurement of essentially all depot level reparables 
from the military services to DLA. This recommendation realigns all 16 
of the current DLA and service inventory control points and closes 4 
through consolidation--Fort Huachuca, Arizona; Fort Monmouth, New 
Jersey; Rock Island, Illinois; and Lackland Air Force Base, Texas--
while opening a new inventory control point at Aberdeen Proving Ground, 
Maryland. The recommendation also supports the Army's closure of Fort 
Monmouth by moving supply and storage functions to other locations. 

The recommendation regarding the realignment of commodity management 
disestablishes the wholesale supply, storage, and distribution 
functions within the department for all tires; packaged petroleum, 
oils, and lubricants; and compressed gases used by DOD. As a result, 
these commodities will be supplied directly by private industry, which 
will free up space and personnel used to manage these items. It 
realigns all of the remaining defense distribution depots by 
disestablishing all storage and distribution for the commodities. 

Issues Identified with Approved Recommendations: 

Although time did not permit us to fully assess the operational impact 
of each recommendation, particularly where operations proposed 
consolidation across multiple and varied locations, available 
information suggests these recommendations have the potential for more 
efficient operations within DOD. At the same time, there are some 
issues we identified that we believe the BRAC Commission may wish to 
consider during its review process because of potentially overstated 
savings estimates. In this regard, the supply and storage group claimed 
savings for future cost avoidances for sustainment and facilities' 
recapitalization related to the facilities' space that is expected to 
be vacated under the recommended actions. However, as discussed below, 
it is uncertain whether these savings will actually materialize if 
these facilities are not closed and remain open--even with reduced 
usage of the space. Additionally, the group did not develop 
recommendations for several areas within the scope of its 
responsibility that may have further contributed to the accomplishment 
of DOD's BRAC objectives, such as additional consolidations in DLA and 
service inventory control points. 

Estimated Savings Related to Business Process Improvements Are 
Uncertain: 

The largest portion of the supply and storage group's savings--about 
$291 million out of total net annual recurring savings of $406 million-
-comes from business process reengineering improvements in the form of 
expanded use of performance-based logistics and reductions to duplicate 
inventory. According to supply and storage staff, these savings accrue 
from reduced contract prices because DLA will have increased buying 
power since it is responsible for purchasing many more items that had 
been purchased by each of the services. In addition, savings accrue 
from increased use of performance-based agreements,[Footnote 145] a key 
component of performance-based logistics. The group estimates DLA can 
save 2.8 cents on each contract dollar placed on performance-based 
agreements. In addition, savings come from reductions in the amount of 
stock that must be held in inventory. Supply and storage staff said 
that the savings component for the cost to hold this inventory has 
three parts: (1) cost of money, (2) cost of stock losses due to 
obsolescence, and (3) cost of storage. The group estimates that 
together these three factors save about 17 percent of the estimated 
value of the acquisition cost of the stock that is no longer required 
to be held in inventory. Although the group had some supporting 
documentation for its assumptions, time did not allow us to fully 
evaluate the documentation. Nevertheless, the full magnitude of savings 
likely to be realized will depend on how well the actions, if approved, 
are implemented in line with the assumptions made. 

Estimated Savings Related to Vacated Facility Space May Be Overstated: 

All of the supply and storage group's recommendations taken together 
show significant projected savings from expected reductions to excess 
or unnecessary infrastructure. According to the group's estimates, it 
is claiming BRAC savings on about 27 million square feet of vacated 
space--an estimated savings of about $100 million annually or about 25 
percent of the group's total net annual recurring savings. In 
developing its costs and savings estimates, the group assumed that all 
of the excess infrastructure that was made possible by the 
recommendations would generate BRAC savings because it was further 
assumed that the infrastructure would no longer be used and therefore 
would not require sustainment and recapitalization funding. However, we 
believe these assumptions are not necessarily valid because it is not 
clear that the freed-up infrastructure will be eliminated and could 
potentially be occupied by other users following the BRAC process. At 
present the group does not have plans for this space. Under the BRAC 
process, if these vacated facilities or portions thereof are reoccupied 
by other defense organizations, there is a corresponding cost for this 
reoccupation. Likewise, additional BRAC costs are required for 
facilities that remain empty to minimally maintain them, and costs are 
incurred if buildings are demolished. Supply and storage officials told 
us they were aware of this issue and said that their goal is to vacate 
as much space as possible by re-warehousing inventory and by reducing 
personnel spaces, but they do not have a specific plan for what will 
happen to the space once it is vacated. In addition, until these 
recommendations are ultimately approved and implemented, it will not be 
known exactly how much space is available or how this space will be 
disposed of or utilized. As a result, it is unclear as to how much of 
the estimated $100 million net annual recurring savings will actually 
occur. 

Potential for Additional Savings Exists: 

The recommendation that was approved by the IEC to consolidate some 
service inventory control point functions within DLA will move about 
1,345 of the services' staff performing inventory control point 
functions to DLA and is estimated by the supply and storage group to 
save about $1.9 billion over the next 20 years. However, the group also 
analyzed a scenario that would have moved more inventory control point 
functions and more than 6,500 service staff to DLA and was estimated by 
the group to save $2.9 billion over the same 20-year period. The latter 
scenario would leave nearly 3,900 service technical and engineering 
support personnel of the more than 10,300 service staff at existing 
service inventory control points. Senior-level principal members of the 
supply and storage group consider the technical and engineering support 
personnel positions to be more closely related to weapon system 
readiness and support to the warfighter than other inventory control 
point functions, such as contracting, budgeting, and inventory 
management, which are being transferred to DLA. These officials were 
not willing to suggest transferring the technical positions to DLA 
because of the perceived additional risk involved of not being able to 
supply the critical parts to the warfighter when needed. Therefore, 
they approved the recommendation that generated less savings, but also 
less risk to weapon system readiness and moved fewer inventory control 
point functions and fewer service staff to DLA. The Commission may wish 
to further examine the potential for greater savings regarding the 
transfer of more inventory control point functions versus the potential 
risk of not being able to supply critical parts when needed. 

The group also did not pursue the development of recommendations 
regarding the defense reutilization and marketing office activities, 
even though considerable excess capacity exists, as shown in table 36, 
in that area. Group officials told us that these activities, which are 
managed by DLA, are considered follower organizations[Footnote 146] 
that are currently undergoing an extensive A-76[Footnote 147] 
initiative outside the BRAC process that is expected to either close or 
consolidate several activities and reduce staff levels at others. DLA 
data indicate that 61 of the 67 reutilization and marketing office 
activities analyzed by the supply and storage group are involved in the 
effort and that the agency expects to save about $36 million through 
2011 with the A-76 effort. 

[End of section]

Appendix XII: Technical Joint Cross-Service Group Selection Process and 
Recommendations: 

The Technical Joint Cross-Service Group followed the common analytical 
framework established by the Office of the Secretary of Defense (OSD) 
in reviewing its functions and facilities. The group included in its 
report 13 recommendations that it projects would generate about $2.2 
billion in 20-year net present value savings for DOD. These 13 
recommendations incorporate a total of 6 closures, 62 realignments, and 
1 disestablishment action. Additionally, the technical group 
transferred parts of nine recommendations to other joint cross-service 
groups or military services, which combined with other actions 
resulting in three additional closures.[Footnote 148] The majority of 
the projected annual recurring savings result from eliminating civilian 
and contractor personnel and vacating leased space. The recommendations 
have payback periods--the time required for savings to offset closure 
and realignment costs--ranging from 1 to 26 years. Limited progress was 
made to foster greater jointness and transformation. The DOD Inspector 
General and the military service audit agencies, which performed audits 
of the data used in the process, concluded that the data were 
sufficiently reliable for use during the BRAC process. While available 
data supporting the recommendations suggest their implementation should 
provide for more efficient operations within the department, we believe 
there are some issues that the BRAC Commission may wish to examine more 
closely during its review process. 

Organization and Focus: 

The technical group was chaired by the Director, Defense Research and 
Engineering; it consisted of senior members from each military 
department and the Joint Chiefs of Staff.[Footnote 149] The group 
created five subgroups to evaluate the technical facilities: (1) 
Command, Control, Communications, and Computers, Intelligence, 
Surveillance, and Reconnaissance (C4ISR); (2) Air, Land, Sea, and Space 
Systems; (3) Weapons and Armaments; (4) Innovative Systems; and (5) 
Enabling Technologies. In addition, the group also created a 
Capabilities Integration Team and an Analytical Team to support the 
efforts of the subgroups. 

Framework for Analysis: 

The technical group established two principles to guide its analysis 
and recommendation development: (1) provide efficiency of operations by 
consolidating technical facilities to enhance synergy and reduce excess 
capacity and (2) maintain competition of ideas by retaining at least 
two geographically separated sites. The group analyzed three functional 
areas within DOD: research, development and acquisition, and test and 
evaluation.[Footnote 150] It focused its analysis of the 3 functions 
across 13 technical capability areas--air platforms; battlespace 
environments; biomedical; chemical and biological defense; ground 
vehicles; human systems; information systems; materials and processes; 
nuclear technology; sea vehicles; sensors, electronics, and electronic 
warfare; space platforms; and weapons and armaments.[Footnote 151] Each 
of the military services and some defense agencies perform work in the 
functions and technical capability areas. The group developed a 
strategic framework based on its two principles that focused on 
establishing multifunctional and multidisciplinary centers of 
excellence,[Footnote 152] which served as the starting point for 
developing scenarios. These strategy-driven scenarios were later 
confirmed by capacity and military value data and military judgment. 
The DOD Inspector General and service audit agencies performed an 
important role in ensuring the accuracy of data used in these analyses 
through extensive audits of data gathered at various locations. 

Capacity Analysis: 

The technical group's analysis of DOD's technical infrastructure across 
each of the 3 functions and 13 technical capability areas resulted in a 
total of 39 "technical facility categories" around which the group 
focused its analysis.[Footnote 153] The group used two capacity 
measures--work years, as quantified by the number of full-time staff, 
and the number of test hours--and subsequently collected certified data 
on these measures from the technical facilities performing work in each 
of the technical facility categories. Excess capacity was defined as 
the difference between current usage plus a surge factor and peak 
capacity. Current usage was defined as the average usage for fiscal 
years 2001 through 2003, and peak capacity was defined as the maximum 
capacity for the measure. The group set the surge factor at 10 percent 
of current capacity, based on military judgment of how the technical 
community has approached surge in the past. 

The group calculated excess capacity for each of the 39 technical 
facility categories; however, the aggregated data provide more insight 
into the amount of excess capacity. Table 39 shows the excess capacity 
that the technical group found through its analysis. 

Table 39: Excess Capacity Identified by the Technical Joint Cross-
Service Group: 

Figures in work years. 

Research; 
Peak capacity: 31,168; 
Current usage plus surge: 28,069; 
Excess capacity: 3,099; 
Percentage of excess capacity: 11.0%. 

Development and acquisition; 
Peak capacity: 106,944; 
Current usage plus surge: 101,208; 
Excess capacity: 5,736; 
Percentage of excess capacity: 5.7%. 

Test and evaluation; 
Peak capacity: 44,852; 
Current usage plus surge: 40,319; 
Excess capacity: 4,533; 
Percentage of excess capacity: 11.2%. 

Total; 
Peak capacity: 182,964; 
Current usage plus surge: 169,596; 
Excess capacity: 13,368; 
Percentage of excess capacity: 7.9%. 

Source: Technical Joint Cross-Service Group. 

[End of table]

The group reported that the current required capacity, including surge, 
across all technical capability areas and functions is 169,596 work 
years. The group found the equivalent of 13,368 work years, or 7.9 
percent, excess capacity across the three functions. The group reports 
that its recommendations eliminate approximately 3,000 work years. 
Based on these calculations, approximately 6 percent excess capacity 
would remain if all of the group's recommended actions are implemented. 
The work year reductions include the reductions made through the 
technical group's 13 recommendations. The work year reductions do not 
include reductions in technical excess capacity through the closure of 
Fort Monmouth, New Jersey, and Brooks City-Base, Texas, for example, 
which are included in the Army and Medical Joint Cross-Service Group 
recommendations, respectively. 

Military Value Analysis: 

As with capacity analysis, the technical group's assessment of military 
value included an assessment of the technical infrastructure across the 
39 technical facility categories. The group weighted each of the four 
military value criteria based on the importance of the criterion to the 
technical function. The group used the same weights for the research 
and development and acquisition functions, but different weights for 
the test and evaluation function due to differences in the type of work 
conducted at these facilities. Table 40 shows the weights for the three 
functions. 

Table 40: Technical Joint Cross-Service Group Military Value Criteria 
Weights: 

Figures in percentages. 

Military value criteria: 1. The current and future mission capabilities 
and the impact on operational readiness of the total force of the 
Department of Defense, including impact on joint warfighting, training, 
and readiness; 
Research, development and acquisition: 53%; 
Test and evaluation: 53%. 

Military value criteria: 2. The availability and condition of land, 
facilities, and associated airspace (including training areas suitable 
for maneuver by ground, naval, or air forces throughout a 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; 
Research, development and acquisition: 12%; 
Test and evaluation: 18%. 

Military value criteria: 3. The ability to accommodate contingency, 
mobilization, surge, and future total force requirements at both 
existing and potential receiving locations to support operations and 
training; 
Research, development and acquisition: 25%; 
Test and evaluation: 19%. 

Military value criteria: 4. The cost of operations and the manpower 
implications; 
Research, development and acquisition: 10%; 
Test and evaluation: 10%. 

Total; 
Research, development and acquisition: 100%; 
Test and evaluation: 100%. 

Source: DOD and the Technical Joint Cross-Service Group. 

Note: The system of weights provided a basis for assigning relative 
value to data collected and tabulated across each military value 
dimension. 

[End of table]

The group developed attributes and metrics across each of the four 
military value criteria to measure military value and subsequently 
collected certified data for these capacity measures from the technical 
facilities performing work in each of the technical facility 
categories. The group examined the capabilities of each technical 
facility based on five attributes: 

* people, which measures intellectual capital;

* physical environment, which measures special features of technical 
facilities;

* physical structures and equipment, which measure the presence of 
physical structures unique within DOD and the value, condition, and use 
of these structures;

* operational impact, which measures the output of the three functional 
areas (research, development and acquisition, and test and evaluation); 
and: 

* synergy, which measures working on multiple technical capability 
areas and functions and jointness. 

The technical group developed weights for the 5 attributes that were 
applied to each of the criteria and 30 metrics divided among the 5 
attributes. While the group allowed the evaluative weights for the 
metrics to vary across its subgroups, it used the same weights for the 
five attributes. The evaluative weight assigned to attributes varied 
among the three functions because a particular attribute could have 
greater importance for one function than another. For example, the 
technical group weighted the people attribute for criterion 1 at 17 
percent of the total military value score for research, 13 percent for 
development and acquisition, and 16 percent for test and evaluation. 
While the attribute weights were the same for activities across 
subgroups, the metric weights varied by subgroup. For example, the Air, 
Land, Sea, and Space Systems subgroup weighted the patents, 
publications, and awards metric of criterion 1 for the research 
function at 30 percent of the total for the people attribute, while the 
Weapons and Armaments subgroup weighted the same metric at 18 percent. 

Figure 19 provides an example of the technical group's military value 
attributes, metrics, data sources, and their link to the four BRAC 
military value criteria. 

Figure 19: Selected Attributes, Metrics, and Data Questions Used to 
Assess Military Value of a Technical Facility: 

[See PDF for image] 

[A] The BRAC military value criteria are the first four BRAC selection 
criteria. 

[B] Military value attributes are characteristics of each criterion. 
The technical group used a total of five military value attributes. 

[C] Military value metrics are measures for the attributes. The 
technical group used a total of 30 military value metrics. 

[D] The technical group used a total of 44 data call questions. 

[End of figure] 

All technical facilities were analyzed using the technical group's 
military value approach, regardless of whether the recommendation ended 
up with the technical group's 13 recommendations or in another 
services' or joint cross-service groups' recommendations. For example, 
part of the Army's recommendation to close Fort Monmouth relocates the 
information systems research and development and acquisition to 
Aberdeen Proving Ground, Maryland. The technical group followed the 
same process in gathering data and calculating a military value score 
for these functions as they did all other technical functions. 

DOD Inspector General's and Service Audit Agencies' Role in the 
Process: 

The DOD Inspector General and the service audit agencies played 
important roles in ensuring that the data used in the technical group's 
data analyses were certified. To determine the validity of the group's 
data, the DOD Inspector General examined (1) whether the group used 
certified data and created an adequate audit trail for capacity and 
military value analyses and (2) whether the group created an adequate 
audit trail for inputting data into the Cost of Base Realignment 
Actions (COBRA) model. The DOD Inspector General found that certified 
data were used for the group's capacity and military value analyses, 
and there was an adequate audit trail for the capacity and military 
value analyses, and COBRA input data. Through extensive audits of the 
data collected from technical facilities during the process, the 
service audit agencies notified the technical facility of identified 
data discrepancies and the technical facility was to take corrective 
action. While the process for detecting and correcting data errors was 
quite lengthy and challenging, the DOD Inspector General and service 
audit agencies deemed the technical data to be sufficiently reliable 
for use in the BRAC process. 

Identification and Assessment of Alternate Scenarios and Selection of 
Recommendations: 

The technical group used its strategic framework to identify 69 
potential closure or realignment scenarios and then select 23 candidate 
recommendations. The group confirmed its scenarios and recommendations 
with its capacity and military value data and military judgment. In 
most cases, each scenario that did not become a candidate 
recommendation was one of several alternatives for moving the same work 
to different locations. The ISG and IEC accepted 22 of the technical 
group's candidate recommendations. One recommendation, which realigned 
technical functions at Naval Support Activity Corona, California, to 
several different bases, was disapproved by the ISG because the Navy 
wanted to keep these functions together, according to a technical group 
official. The official said that the ISG allowed the Navy to construct 
a different recommendation, which moved these functions to Naval Air 
Station Point Mugu, California, and this recommendation was approved 
and is presented with the Navy's recommendations.[Footnote 154] Nine of 
the group's recommendations were transferred to the services or other 
joint cross-service groups, which left the technical group with 13 
recommendations. The 13 recommendations included in the group's report 
result in a total projected net savings of $2.2 billion over 20 years, 
with net annual recurring savings of $265.5 million per year and 
payback periods ranging from 1 to 26 years. Personnel savings account 
for over half of the group's projected annual recurring savings, three-
quarters of which comes from civilian personnel savings. While 
available data supporting the recommendations suggest their 
implementation should provide for more efficient operations within the 
department, we believe there are some issues that the BRAC Commission 
may wish to examine more closely during its review process. 

Recommendations Approved by DOD: 

The technical group's proposed recommendations result in a total 
projected net savings of $2.2 billion over 20 years, with net annual 
recurring savings of $265.5 million per year. Table 41 provides a 
summary of the financial aspects of the group's recommendations, most 
of which are realignment actions. 

Table 41: Financial Aspects of the Technical Joint Cross-Service 
Group's Recommendations: 

Fiscal year 2005 constant dollars in millions. 

Recommendations: Realign and close to co-locate extramural research 
program managers (at the National Naval Medical Center, Bethesda)[C]; 
DOD report page: Tech-5; 
One-time costs: ($153.5); 
Net implementation (costs) or savings[A]: $107.1; 
Net annual recurring (costs) or savings: $49.4; 
Payback period (years): 2; 
20-year net present value (costs) or savings[B]: $572.7. 

Recommended action: Realign to consolidate maritime C4ISR RDAT&E (at 
Naval Amphibious Base, Little Creek; Naval Surface Warfare Center, 
Dahlgren Division; Naval Station Newport; Naval Submarine Base Point 
Loma; Naval Weapons Station Charleston; and Naval Station Norfolk); 
DOD report page: Tech-9; 
One-time costs: ($106.1); 
Net implementation (costs) or savings[A]: $88.6; 
Net annual recurring (costs) or savings: $38.7; 
Payback period (years): 1; 
20-year net present value (costs) or savings[B]: $455.1. 

Recommended action: Realign to create a naval integrated weapons and 
armaments RDAT&E center (at Naval Air Weapons Station China Lake, Naval 
Surface Warfare Center Indian Head, and Naval Surface Warfare Center 
Dahlgren); 
DOD report page: Tech-15; 
One-time costs: ($358.1); 
Net implementation (costs) or savings[A]: ($148.7); 
Net annual recurring (costs) or savings: $59.7; 
Payback period (years): 7; 
20-year net present value (costs) or savings[B]: $433.4. 

Recommended action: Realign and close to consolidate defense research 
service-led laboratories (at Wright-Patterson Air Force Base, Kirtland 
Air Force Base, Hanscom Air Force Base, and Aberdeen Proving Ground); 
DOD report page: Tech-22; 
One-time costs: ($164.6); 
Net implementation (costs) or savings[A]: ($45.0); 
Net annual recurring (costs) or savings: $41.1; 
Payback period (years): 4; 
20-year net present value (costs) or savings[B]: $357.3. 

Recommended action: Realign to consolidate air and space C4ISR RDAT&E 
(at Hanscom Air Force Base and Edwards Air Force Base); 
DOD report page: Tech-6; 
One-time costs: ($254.4); 
Net implementation (costs) or savings[A]: ($115.3); 
Net annual recurring (costs) or savings: $36.2; 
Payback period (years): 8; 
20-year net present value (costs) or savings[B]: $238.0. 

Recommended action: Realign to consolidate Navy strategic T&E (at 
Strategic Weapons Facility Atlantic, Kings Bay); 
DOD report page: Tech-12; 
One-time costs: ($86.4); 
Net implementation (costs) or savings[A]: ($76.7); 
Net annual recurring (costs) or savings: $13.4; 
Payback period (years): 7; 
20-year net present value (costs) or savings[B]: $61.4. 

Recommended action: Realign to create an integrated weapons and 
armaments specialty site for guns and ammunition (at Picatinny 
Arsenal); 
DOD report page: Tech-19; 
One-time costs: ($116.3); 
Net implementation (costs) or savings[A]: ($81.2); 
Net annual recurring (costs) or savings: $11.3; 
Payback period (years): 13; 
20-year net present value (costs) or savings[B]: $32.6. 

Recommended action: Realign to establish centers for fixed wing air 
platform RDAT&E (at Wright-Patterson Air Force Base and Naval Air 
Weapons Station China Lake); 
DOD report page: Tech-24; 
One-time costs: ($17.7); 
Net implementation (costs) or savings[A]: ($7.9); 
Net annual recurring (costs) or savings: $2.7; 
Payback period (years): 9; 
20-year net present value (costs) or savings[B]: $17.9. 

Recommended action: Realign to create an air integrated weapons and 
armaments RDAT&E center (at Eglin Air Force Base); 
DOD report page: Tech-18; 
One-time costs: ($2.7); 
Net implementation (costs) or savings[A]: $4.9; 
Net annual recurring (costs) or savings: $1.4; 
Payback period (years): 2; 
20-year net present value (costs) or savings[B]: $17.9. 

Recommended action: Realign to consolidate ground vehicle D&A in a 
joint center (at Detroit Arsenal)[D]; 
DOD report page: Tech-7; 
One-time costs: ($3.8); 
Net implementation (costs) or savings[A]: ($1.9); 
Net annual recurring (costs) or savings: $1.9; 
Payback period (years): 2; 
20-year net present value (costs) or savings[B]: $17.1. 

Recommended action: Realign to create a Navy sensors, electronic 
warfare, and electronics RDAT&E center (at Naval Air Warfare Center, 
Weapons Division, China Lake); 
DOD report page: Tech-28; 
One-time costs: ($72.7); 
Net implementation (costs) or savings[A]: ($50.9); 
Net annual recurring (costs) or savings: $6.7; 
Payback period (years): 12; 
20-year net present value (costs) or savings[B]: $16.9. 

Recommended action: Realign to consolidate sea vehicle D&A (at Naval 
Surface Warfare Center Carderock and Naval Sea Systems Command, 
Washington Navy Yard); 
DOD report page: Tech-13; 
One-time costs: ($1.5); 
Net implementation (costs) or savings[A]: ($0.1); 
Net annual recurring (costs) or savings: $0.2; 
Payback period (years): 7; 
20-year net present value (costs) or savings[B]: $2.0. 

Recommended action: Realign to establish centers for rotary wing air 
platform DAT&E (at Patuxent River and Redstone Arsenal); 
DOD report page: Tech-26; 
One-time costs: ($49.4); 
Net implementation (costs) or savings[A]: ($40.2); 
Net annual recurring (costs) or savings: $2.8; 
Payback period (years): 26; 
20-year net present value (costs) or savings[B]: ($11.8). 

Total; 
One-time costs: ($1,387.2); 
Net implementation (costs) or savings[A]: ($367.4); 
Net annual recurring (costs) or savings: $265.5; 
Payback period (years): [Empty]; 
20-year net present value (costs) or savings[B]: $2,210.5. 

Source: GAO analysis of DOD data. 

Notes: R denotes the research functions, D&A denotes the development 
and acquisition functions, and T&E denotes the test and evaluation 
functions. C4ISR denotes command, control, communications, and 
computers, intelligence, surveillance, and reconnaissance. 

[A] This represents net costs or savings within the 6-year 
implementation period required to implement BRAC recommendations. 

[B] DOD used a 2.8 percent discount rate to calculate net present 
value. 

[C] We identified an additional $12.8 million that was included as a 
one-time savings but should have been an annual recurring savings for 
the recommendation to co-locate extramural research program managers. 
If this amount were included, the annual recurring savings increases to 
$62.2 million and the 20-year net present value increases to a savings 
of $698.6 million. 

[D] We identified errors, including antiterrorism force protection 
savings listed as a recurring, rather than a one-time, savings, that 
overstated the annual recurring savings for the recommendation to 
consolidate ground vehicle development and acquisition in a joint 
center. When these errors are corrected, there is an annual recurring 
cost of $59,000, a 20-year net present value a cost of $4.3 million, 
and the recommendation never pays back. 

[End of table]

The majority of the projected net annual recurring savings are based on 
eliminating civilian and contractor personnel ($167.7 million) as 
functions are realigned between installations and vacating leased space 
($51.8 million). On the other hand, the majority of the projected costs 
are for constructing new facilities ($644.6 million) and moving 
personnel and equipment ($326.7 million) to the gaining installations. 
The group's 13 recommendations include 6 closures, 62 realignments, and 
1 disestablishment for a total of 69 actions. For example, the group's 
recommendation to consolidate maritime C4ISR research, development and 
acquisition, and test and evaluation includes 16 realignment actions 
and 1 disestablishment action. 

The technical group's recommendations support, to a limited extent, the 
goals of maximizing jointness and furthering transformation efforts 
within the department. Eight of the group's 13 recommendations move 
functions from one service or defense agency's installation to another 
service's installation. For example, the recommendation to create an 
integrated weapons and armaments specialty site for guns and ammunition 
moves seven Navy functions to an Army installation. While the chairman 
of the group's Capabilities Integration Team told us that all of the 
group's recommendations were transformational, the supporting 
information often suggested the recommendations were more focused on 
combining like work at a single location without a clear indication of 
how it provided for transformation. Two of the group's recommendations 
specifically mention transformation in their justification statements, 
but the transformational effects are not clear in the documentation. 
For example, the recommendation to create an air integrated weapons and 
armaments research, development and acquisition, and test and 
evaluation center states that it supports transformation because it 
moves and consolidates smaller weapons and armaments efforts into high 
military value integrated centers and leverages synergy among the three 
functions; however, the documentation does not discuss how these 
actions are transformational. 

Issues Identified with Approved Recommendations: 

Time did not permit us to assess the operational impact of each of the 
technical group's recommendations, particularly where operations 
proposed for consolidation extend across multiple locations outside of 
a single geographic area. At the same time, we offer a number of broad-
based observations about the proposed recommendations. 

While available data supporting the recommendations suggest their 
implementation should provide for more efficient operations within DOD, 
there are some issues that the BRAC Commission may wish to consider 
during its review process. Specifically, the Commission may want to 
consider whether the level of personnel reductions is attainable, 
issues related to projected savings from vacating leased space, the 
long payback period and relatively small savings for some 
recommendations, and the economic impact of one recommendation. 

Personnel Reductions: 

The technical group developed a standard assumption to eliminate 15 
percent of military and civilian personnel affected by the 
recommendation for consolidation and joint actions based on personnel 
eliminations at technical facilities in previous BRAC rounds.[Footnote 
155] The group used a different assumption (5.5 percent reduction in 
affected military and civilian personnel) for co-location actions 
because it is believed that there are likely to be fewer efficiency 
gains for co-locations than consolidations or joint actions. A 
technical group official told us that in some cases the group used 
higher personnel reduction estimates than the standard because the 
military department provided for higher estimated personnel reductions 
in the certified data, and the military services agreed with all 
personnel eliminations in the group's recommendations. We believe there 
is some uncertainty regarding the magnitude of the group's expected 
savings for these personnel reductions because its estimates are based 
on assumptions that have undergone limited testing and full savings 
realization depends upon the attainment of these personnel reductions. 
Eight of the group's 13 recommendations eliminate at least 15 percent 
of military and civilian personnel positions affected by the 
recommendation. Personnel savings account for at least 40 percent, and 
as much as 100 percent, of the group's projected annual recurring 
savings for each of these 8 recommendations. Almost three-quarters of 
all personnel savings come from civilian personnel eliminations. 

Similar to military and civilian personnel, the technical group 
developed a standard assumption that the subgroups could eliminate 15 
percent of contractor personnel and could take $200,000 in recurring 
savings for each contractor position eliminated. It is unclear from the 
data what percentage of contractor positions were eliminated because 
the total number of contractor personnel is not included in the COBRA 
data. Seven of the group's recommendations include savings from 
eliminating contractor personnel, for a total of $53.9 million in net 
annual recurring savings.[Footnote 156] In contrast, the data on 
economic impact (criterion 6 of the BRAC selection criteria) show a net 
loss of 508 contractor personnel in 10 recommendations, which would 
have totaled $101.6 million in net annual recurring savings. Technical 
group officials told us that both sets of numbers are based on 
certified data from the services; however, they added that the 
contractor data were difficult to collect because they were provided by 
the services through the scenario data calls, rather than as standard 
data in the COBRA model. 

It is unclear to what extent the personnel reductions assumed in the 
group's recommendations will be attained, largely because of 
uncertainties associated with the group's assumptions. For example, the 
group's recommendation to create a naval integrated weapons and 
armaments research, development and acquisition, and test and 
evaluation center includes the reduction of 15 percent of military and 
civilian personnel. As mentioned above, the technical group assumed a 
standard 15 percent reduction in military and civilian personnel for 
consolidation and joint actions and a 5.5 percent reduction in military 
and civilian personnel for co-location actions. Because we are 
uncertain whether the 15 percent reduction in military and civilian 
personnel for consolidations and joint actions is attainable, we 
determined the costs and savings of the recommendation with the 5.5 
percent personnel reduction for co-locations. Table 42 shows the 
financial aspects of DOD's original recommendation with a 15 percent 
reduction in military and civilian personnel, our analysis of the 
recommendation with a 5.5 percent reduction in military and civilian 
personnel, and the difference between the two recommendations. 

Table 42: Comparison of Alternatives to Personnel Reductions for the 
Recommendation to Create a Naval Integrated Weapons and Armaments 
Research, Development and Acquisition, and Test and Evaluation Center: 

Fiscal year 2005 constant dollars in millions. 

DOD's recommendation; 
Net annual recurring savings: $59.7; 
Payback period (years): 7; 
20-year net present value savings (cost): $433.4. 

Recommendation: GAO's analysis (5.5 percent military and civilian 
personnel reduction); 
Net annual recurring savings: $42.0; 
Payback period (years): 10; 
20-year net present value savings (cost): $201.8. 

Difference; 
Net annual recurring savings: $17.7; 
Payback period (years): ($3); 
20-year net present value savings (cost): $231.6. 

Source: GAO analysis of DOD data. 

[End of table]

Leased Space: 

Our analysis identified some inconsistencies in projecting annual 
recurring savings and one-time savings in three 
recommendations[Footnote 157] to move activities from leased 
space.[Footnote 158] The technical group used two different 
methodologies to project annual recurring savings from vacating leased 
space. In one recommendation, the group projected annual recurring 
savings based on future leased costs[Footnote 159] while in the other 
two, the group used actual lease costs data provided by the military 
services and defense agencies. Furthermore, the recommendation to co-
locate the extramural research program managers also includes $2.7 
million in annual recurring savings for the Defense Threat Reduction 
Agency vacating leased space; however, the agency is already scheduled 
to move to Fort Belvoir, Virginia, in January 2006. 

The technical group also included $14.5 million in one-time savings for 
seven of the eight activities[Footnote 160] vacating leased space for 
the cost of upgrading existing leased space to meet DOD's antiterrorism 
and force protection standards.[Footnote 161] The group did not collect 
data that would indicate whether existing leases met the antiterrorism 
and force protection standards. Our analysis indicates that excluding 
these one-time savings would have minimal impact on the overall 
projected savings of the technical group's recommendations. 

Limited Savings during Implementation Period: 

Only 3 of the 13 recommendations achieve savings during the 6-year 
implementation period, and 3 of the group's recommendations take longer 
than 10 years to achieve savings, far longer than typically occurred in 
the 1995 BRAC round. According to a technical group official, the 
recommendation to establish a center for rotary wing air platform 
research, development and acquisition, and test and evaluation, which 
has a 26-year payback, was retained because it realigns the technical-
related work away from a test range at Fort Rucker, Alabama, which will 
provide for expanded training space. An Army official agreed that a 
potential benefit of realigning the test range at Fort Rucker is that 
it would make available hangars, facilities, and airspace for trainers. 
For example, the Army said that the vacated hangar space could 
potentially be used to accommodate the Aviation Logistic School's 
proposed move to Fort Rucker and the reduced demand for airspace will 
make additional airspace available to meet the current and future needs 
for manned and unmanned aviation training. 

The group's recommendation to create an integrated weapons and 
armaments specialty site for guns and ammunition, which has one-time 
costs of $116.3 million and a 20-year net present value savings of 
$32.6 million, has a payback of 13 years. Technical group officials 
told us that this recommendation was determined to be worth the costs 
and longer payback period because it provides synergy and jointness, as 
well as eliminating some duplication, in research and development and 
acquisition of guns and ammunition for the Army and Navy. 

According to a group official, the group's recommendation regarding 
Navy sensors, electronic warfare, and electronics research, development 
and acquisition, and test and evaluation, which has a 12-year payback 
period, is beneficial because it consolidates similar work currently 
performed at locations that are in proximity to each other and clears 
out laboratory space at Naval Air Station Point Mugu, California, that 
is needed for personnel moving in from Naval Support Activity Corona, 
California, through a Navy recommendation. The official added that 
while the payback for this recommendation is long, it should be put 
into perspective with the savings from closing Naval Support Activity 
Corona because the savings from closing that facility (net annual 
recurring savings of $6.0 million and a 20-year net present value of 
$0.4 million) would be smaller had the laboratory space not been 
available at Point Mugu.[Footnote 162]

Economic Impact: 

One of DOD's BRAC selection criteria, criterion 6, required the 
department to consider the economic impact on existing communities in 
the vicinity of military installations when determining realignments 
and closures. In most cases, the group's recommendations had a 
cumulative impact on communities of less than 1 percent as measured by 
direct and indirect job loss as a percentage of employment for the 
economic area of the military installation. However, the exception is 
the recommendations that realign activities from Naval Surface Warfare 
Center Crane, Indiana, which would result in an economic impact of 9.3 
percent. A technical group official stated that realigning the 
technical infrastructure to respond to defense needs over the next 20 
years took priority over the economic impact of the proposed 
recommendation. Two of the group's recommendations realign or eliminate 
approximately 460 military and civilian personnel and 80 contractor 
personnel from Naval Surface Warfare Center Crane, for a cumulative 
reduction of 9.3 percent of employment in Martin County, Indiana, when 
direct and indirect jobs are considered.[Footnote 163]

Personnel Realignments from Point Mugu: 

There is some uncertainty on the number of civilian personnel that 
would be realigned in the technical group's recommendation to create a 
naval integrated weapons and armaments research, development and 
acquisition, and test and evaluation center. The recommendation 
proposes to realign about 1,400 civilian employees from Naval Air 
Station Point Mugu, California, to Naval Air Weapons Station China 
Lake, California. However, in its data call submission, Naval Air 
Station Point Mugu identified 505 civilian employees that operate or 
support an outdoor range that it believes should remain at Point Mugu; 
however the technical group's recommendation proposes to move these 
personnel to China Lake.[Footnote 164] A Navy official said that if the 
recommendation is approved the Navy will decide the best way to manage 
the range, including the appropriate number of employees to retain at 
Point Mugu, during implementation. Our analysis indicates that if the 
505 civilian employees remain at Point Mugu, the 20-year net present 
value savings decreases by about $87.4 million but the payback period 
remains at 7 years. 

Scenario Eliminated from Consideration: 

The technical group developed a scenario that would have allowed the 
Air Force to close Los Angeles Air Force Base, California, which may 
have further contributed to the accomplishment of BRAC objectives; 
however, the Air Force Base Closure Executive Group did not approve 
this scenario due to the base's relatively high military value and 
perceived operational risk due to a potential for schedule and 
performance disruption. Table 43 provides a summary of the financial 
aspects of this scenario. 

Table 43: Estimated Costs and Savings for the Rejected Closure of Los 
Angeles Air Force Base: 

Fiscal year 2005 constant dollars in millions. 

Scenario: Close Los Angeles Air Force Base and do not provide work 
space for contractors at Peterson Air Force Base; 
One-time costs: ($305.1); 
Net implementation (costs) or savings[A]: ($161.1); 
Net annual recurring (costs) or savings: $52.9; 
Payback period (years): 6; 
20-year net present value (costs) or savings[B]: $358.5. 

Source: DOD. 

[A] This represents net costs or savings within the 6-year 
implementation period required to implement BRAC recommendations. 

[B] DOD used a 2.8 percent discount rate to calculate net present 
value. 

[End of table]

The technical group developed a scenario to realign space development 
and acquisition from Los Angeles Air Force Base, California, to 
Peterson Air Force Base, Colorado, among other actions, which would 
allow the Air Force to close the base. However, the group deleted the 
scenario based on military judgment before it finished its analysis. 
While the group's meeting minutes do not provide the specific reason 
that the scenario was deleted, the minutes say moving the Space and 
Missile Center from Los Angeles Air Force Base to Peterson Air Force 
Base would involve the movement of the federally funded research and 
development center,[Footnote 165] there was no compelling reason to 
move the Space and Missile Center to Peterson Air Force Base, and the 
Air Force did not support the scenario. Toward the end of the process 
the ISG requested that the technical group finish its analysis. The 
group completed its analysis and presented the information to the Air 
Force Base Closure Executive Group.[Footnote 166] The Air Force Base 
Closure Executive Group decided not to close Los Angeles Air Force Base 
because (1) Los Angeles Air Force Base has the highest military value 
in space development and acquisition--its military value in space 
development and acquisition is four times higher than that of Peterson-
-and (2) the closure has a near-term operational risk due to a 
potential for schedule and performance disruption to development and 
acquisition programs and activities, intellectual capital, and synergy 
with industry based in Los Angeles and surrounding areas. 

Technical group officials told us that there are several reasons to 
close Los Angeles Air Force Base in addition to the net recurring 
savings ($52.9 million) and relatively high 20-year net present value 
savings ($358.5 million). Los Angeles Air Force Base is a single-
service installation that primarily performs one function in one 
technical capability area--development and acquisition of space 
platforms. The technical group sought to identify opportunities to 
consolidate smaller single-function locations to larger multifunction 
facilities, so closing Los Angeles Air Force Base would meet this goal. 
The group proposed to move the functions at Los Angeles Air Force Base 
to Peterson Air Force Base to co-locate the development and acquisition 
function with the operational user. Other alternatives could achieve 
other goals. For example, moving the space development and acquisition 
function from Los Angeles Air Force Base to Kirtland Air Force Base, 
New Mexico, which performs research on space platforms, could expedite 
the transition of technology from the research phase to development and 
acquisition. Alternatively, there could be increased jointness among 
the services if the functions at Los Angeles Air Force Base were moved 
to Redstone Arsenal, Alabama, where much of the Army's space platform 
development and acquisition work is done. 

[End of section]

Appendix XIII: Cost of Base Realignment Actions Model: 

DOD used a quantitative model, known as the Cost of Base Realignment 
Actions (COBRA) model, to provide consistency across the military 
services and the joint cross-service groups in estimating the costs and 
savings associated with BRAC recommendations. DOD has used the COBRA 
model in all previous BRAC rounds and over time has made improvements 
designed to provide better estimating capability. Similarly, DOD has 
continued to improve the model for its use in the 2005 BRAC round. We 
have examined COBRA in the past and during this review and have found 
it to be a generally reasonable estimator for comparing potential costs 
and savings among candidate alternatives. As with any model, the 
quality of the output is a direct function of the input data. Also, as 
in previous rounds, the COBRA model, which relies to a large extent on 
standard factors and averages, does not represent budget quality 
estimates that will be developed once BRAC decisions are made and 
detailed implementation plans are developed. The COBRA model also does 
not include estimated costs of environmental restoration as DOD 
considers these costs a liability that must be addressed whether or not 
an installation is closed. 

COBRA Used as Tool to Estimate Costs and Savings Associated with BRAC 
Recommendations: 

DOD used the COBRA model to address the BRAC 2005 selection criterion 
related to costs and savings associated with the various proposed BRAC 
recommendations.[Footnote 167] It was designed to model the estimated 
costs and savings associated with actions that are necessary to 
implement BRAC recommendations over the 6-year implementation period 
set by the BRAC statute,[Footnote 168] and recurring costs or savings 
thereafter.[Footnote 169] COBRA provides for several key outputs that 
may influence the decision-making process, including (1) estimated 
costs for such factors as personnel severance, moving costs, or 
military construction over the implementation period; (2) estimated 
savings for personnel reductions or eliminations, or reduced operations 
and maintenance costs over that same period; (3) the "payback" time 
required for estimated cumulative savings to outweigh cumulative costs 
for the actions; (4) annual recurring savings; and (5) the net present 
value of BRAC actions, calculated over a 20-year time frame.[Footnote 
170] Collectively, this financial information provides important input 
into the selection process as decision makers weigh the financial 
implications for various BRAC actions along with military value and 
other factors (for example, military judgment) in arriving at final 
decisions regarding the suitability of BRAC recommendations. 

The COBRA model uses a set of formulas, or algorithms, that rely on 
standardized data as well as base-and scenario-dependent data to 
perform its calculations. Standard factors are common to a class of 
bases and are applicable for all recommendations that involve those 
bases. Some standard factors apply only to one DOD component or a 
subset of a component's bases, while others are applicable to all bases 
DOD-wide. Typical standard factors include, for example, average 
personnel salaries and costs per mile and per ton for moving personnel 
and equipment. Base-and recommendation-specific data, which were to be 
certified in accordance with the BRAC statute, include, for example, 
the number of authorized personnel on a base, the size of the base, and 
annual sustainment costs. As with any model, the quality of the output 
is a direct function of the quality of the input data. For this reason, 
the data used in COBRA were to be certified, in a manner similar to 
that employed for the capacity and military value data, as to their 
accuracy. 

COBRA Improvements over Time: 

The COBRA model has been used in the base closure process since 1988, 
and in the intervening years it has been consistently revised to 
address the problems we and others have identified after each round. 
DOD has once again made improvements to the model, as shown in table 
44, that are designed to further refine its estimating capability. 

Table 44: Major Improvements to COBRA for the BRAC 2005 Round: 

BRAC 1995 shortcomings: Inconsistencies across services in developing 
BRAC-related facility construction cost estimates; 
BRAC 2005 improvements: Consistency for construction cost estimates 
established through use of DOD-wide standards for facility categories 
and costs per square foot[A]. 

BRAC 1995 shortcomings: Facility maintenance cost estimates often 
overstated because actual maintenance was typically underfunded; 
BRAC 2005 improvements: Facility maintenance (sustainment) cost 
estimates adjusted to reflect historical service-specific funding of 
maintenance accounts. 

BRAC 1995 shortcomings: Facility rehabilitation cost estimates did not 
specify existing facility condition; 
BRAC 2005 improvements: Facility condition included as a factor in 
developing rehabilitation cost estimates. 

BRAC 1995 shortcomings: Facility recapitalization costs and cost 
avoidances limited to the short term; 
BRAC 2005 improvements: Facility recapitalization costs and cost 
avoidances considered over the longer term using average service-
specific base recapitalization costs. 

BRAC 1995 shortcomings: Estimated costs for operating and maintaining 
retained reserve enclaves on closing bases were not identified; 
BRAC 2005 improvements: Provisions to consider reserve enclave-related 
estimated costs were included. 

BRAC 1995 shortcomings: Average civilian personnel pay cost estimates 
excluded locality pay differentials; 
BRAC 2005 improvements: Locality pay was included in median civilian 
pay costs. 

BRAC 1995 shortcomings: Civilian housing-related relocation cost 
estimates were based on adjusted national median housing costs; 
BRAC 2005 improvements: Housing-related relocation cost estimates were 
targeted to local housing costs associated with base-specific actions. 

BRAC 1995 shortcomings: Algorithms for base operating support costs 
were not properly supported; 
BRAC 2005 improvements: Algorithms were revised, based on service-
specific factors for base operating support. 

BRAC 1995 shortcomings: Limited consideration was given to overall 
medical costs for the government upon closure of military treatment 
facilities; 
BRAC 2005 improvements: Increased consideration was given to medical-
related costs through use of base-specific data related to medical 
beneficiary costs. 

BRAC 1995 shortcomings: No specific consideration was given to storage-
in-transit costs or information technology costs for personnel-related 
moves; 
BRAC 2005 improvements: Standard factors were developed for storage and 
information technology costs. 

Source: GAO analysis of DOD data. 

[A] Square footage requirements were service specific for areas such as 
administrative office space. 

[End of table]

The improvements were made by a COBRA Joint Process Action Team that 
was established early in the 2005 BRAC round process. The Joint Process 
Action Team, consisting of officials from the Office of the Secretary 
of Defense, the military services, and representatives from the joint 
cross-service groups, met frequently over several months in late 2003 
to improve the model. We also attended most of these meetings as 
observers in an oversight role, and we shared our observations and 
raised issues of concern as appropriate. The Joint Process Action Team, 
on many occasions, addressed our concerns by making appropriate changes 
to the model. For example, we reported in June 2003 that COBRA did not 
include estimated costs for operating and maintaining the reserve 
component enclaves created during the prior BRAC rounds,[Footnote 171] 
thereby having the effect of overstating the savings for those 
particular BRAC actions. Consequently, the Joint Process Action Team 
provided for the inclusion of these costs in the COBRA model. In 
another case, the Joint Process Action Team developed an approach to 
incorporate longer term estimated facility recapitalization costs in 
COBRA, thus overcoming a COBRA shortcoming that we identified in our 
1997 report on lessons learned from the prior BRAC rounds.[Footnote 172]

As was done in the 1995 BRAC round, the Army Audit Agency examined the 
improved COBRA model to determine whether the model accurately 
calculated cost and savings estimates as described in the user's 
manual. The Army Audit Agency assumed this responsibility at the 
request of The Army Basing Study Group since the Army serves as the 
executive agent for the COBRA model. The Army Audit Agency tested all 
340 algorithms in the model as presented in the user's manual and 
reported in September 2004 that COBRA accurately calculated costs and 
savings as prescribed in the manual.[Footnote 173] Following the audit, 
however, multiple revisions were made to the model to include changes 
to the TRICARE and privatization algorithms because of programming 
errors in the model. The Army Audit Agency subsequently reexamined the 
revisions where these algorithms were modified and concluded in a 
similar fashion that the model accurately calculated the estimates. In 
addition, the Army Audit Agency validated the certified data and 
documentation supporting the standard factors used in the model. 

Application of COBRA in the 2005 BRAC Round: 

Although the COBRA model serves as a common tool with many standardized 
features across DOD for analyzing costs and savings for alternative 
recommendations, its actual application and results depend heavily on 
the DOD guidance on what constitutes costs or savings, accuracy of the 
input data, and the flexibility provided to users of the model to 
consider additional input data that can affect cost and savings 
estimates. The following are examples of cases where the specific 
application of the model can have an effect on the estimates: 

* The COBRA model generates a dollar amount attributable to the 
reduction or elimination of military personnel at realigning or closing 
bases. While it has been DOD's practice to classify these reductions or 
eliminations as recurring savings, we have consistently taken the view 
that these actions should not be counted as savings that can be used 
outside the military services' personnel accounts unless commensurate 
reductions are made in the affected military services' end strengths. 
We acknowledge that these actions may afford DOD the opportunity to 
redirect these personnel to serve in other roles that would benefit 
DOD. Our analysis of DOD data indicate that about 47 percent--about 
$2.6 billion--of the expected net annual recurring savings of nearly 
$5.5 billion for the 2005 round are attributable to these military 
personnel actions, for which reductions in the military personnel end-
strength levels are not planned. 

* The COBRA model provides users with considerable flexibility in 
estimating one-time and miscellaneous recurring costs or savings of 
various recommendations by allowing them to consider what actions might 
constitute a cost or savings and what the expected dollar amounts 
should be. Validating the level of projected savings is less clear-cut 
for recommendations that, instead of closing facilities, realign 
workloads from one location to another, or that estimate savings in 
overhead or other consolidation efficiencies. The dollar amounts could 
be based on specific assumptions as well as certified data but 
nonetheless be subject to greater degrees of uncertainty pending 
implementation than would be actions resulting in facility closures 
where expected reductions are more clear-cut. Our analysis of the BRAC 
recommendations showed inconsistencies across some of the services and 
joint cross-service groups in applying COBRA in this area. 

* The COBRA model uses authorized base personnel levels in its 
calculations to estimate costs and savings arising from DOD's 
recommendations. DOD decided to use authorized rather than actual 
personnel levels because of difficulties in collecting data on actual 
levels. This decision could create more imprecision in the estimates; 
for example, in cases where the actual personnel levels are higher or 
lower than those authorized for bases that are closing, the savings 
estimates would be either understated or overstated. Time did not 
permit us to determine the extent to which this might be the case in 
the proposed recommendations. 

Comparability of COBRA Estimates and Actual Costs and Savings: 

Although COBRA has provided DOD with a standard quantitative approach 
enabling it to compare the estimated costs and savings associated with 
various proposed BRAC recommendations, it should be noted that it does 
not necessarily reflect with a high degree of precision the actual 
costs or savings that are ultimately associated with the implementation 
of a particular BRAC action. COBRA is not intended to produce budget-
quality data and is not used to develop the budgets for implementing 
BRAC actions, which are formulated following the BRAC decision-making 
process. COBRA estimates may vary from the actual costs and savings of 
BRAC actions for a variety of reasons, including the following: 

* COBRA estimates, particularly those based on standard cost factors, 
are imprecise and are later refined during implementation planning for 
budget purposes. The use of averages has an effect on precision. For 
example, as noted previously, COBRA uses authorized, rather than 
actual, base civilian personnel figures in its calculations. Our work 
has shown that the actual number of personnel may be lower or higher 
than that which is authorized. The authorized personnel levels are 
documented estimates, which can be readily audited. COBRA also uses a 
median national civilian personnel salary figure (adjusted by locality 
pay), rather than average pay at a particular base, in its 
calculations. Further, COBRA estimates are expressed in constant-year 
dollars, whereas budgets are expressed in then-year dollars. 

* Some costs are not fully captured in COBRA. For example, COBRA 
estimates do not include the cost of environmental restoration for BRAC-
affected bases, in keeping with DOD's long-standing policy of not 
considering such costs in its BRAC decision making.[Footnote 174] We 
reported in January 2005 that these costs can be substantial,[Footnote 
175] accounting for about 36 percent, or $8.3 million, of the $23.3 
million in costs incurred through fiscal year 2003 for implementing 
BRAC actions for the previous four BRAC rounds. Further, COBRA does not 
include estimates for some other costs to the federal government, 
particularly those related to other federal agencies or DOD providing 
assistance to BRAC-affected communities. That is because assistance 
costs depend on specific implementation plans that are unknown at the 
time COBRA estimates are developed. In our January 2005 report on the 
previous BRAC rounds, we noted that about $1.9 billion in such costs 
had been incurred through fiscal year 2004. 

* Some savings are not fully captured in COBRA as well. COBRA does not 
include estimates, for example, for anticipated sales of BRAC surplus 
property or other revenue that may be collected in the future through 
property leasing arrangements with BRAC-affected entities. These 
revenues can help offset some of the costs incurred in implementing 
BRAC actions. While such estimates had been included in COBRA in the 
previous rounds, the Joint Process Action Team decided not to include 
any such estimates for the 2005 round because of the difficulty in 
estimating the amount of these revenues. 

Nonetheless, while COBRA estimates do not necessarily reflect the 
actual costs and savings ultimately attributable to BRAC, we have 
recognized in the past and continue to believe that COBRA is a 
reasonably effective tool for the purpose for which it was designed: to 
aid in BRAC decision making. It provides a means for comparing cost and 
savings estimates across alternative closure and realignment 
recommendations. 

[End of section]

Appendix XIV: Economic Impact Assessments: 

One of the eight selection criteria used to make BRAC decisions was the 
economic impact on existing communities in the vicinity of military 
installations coming from BRAC recommendations. DOD measured the 
economic impact of BRAC recommendations on the affected community's 
economy in terms of total potential job change--measured both in 
absolute terms (estimated total job changes) and relative terms (total 
job changes as a percentage of the economic area's total employment). 
This approach to measuring economic impact is essentially the same 
approach DOD used in the 1995 BRAC round. In a series of reports, that 
examine the progress in implementing closures and realignments in prior 
BRAC rounds,[Footnote 176] we examined how the communities surrounding 
closed bases were faring in relation to key national indicators. In our 
last status report,[Footnote 177] we observed that most communities 
surrounding closed bases were faring well economically in relation to 
key national economic indicators. While some communities surrounding 
closed bases were faring better than others, most have recovered or are 
continuing to recover from the impact of BRAC, with more mixed results 
recently, allowing for some negative impact from the 2001 recession. 

While there will be other economic impacts from 2005 BRAC actions that 
DOD did not consider, such as changes in the value of real estate or 
changes in the value of businesses in the economic area, we believe 
that the magnitude of job changes would be correlated with the changes 
in these other dimensions of economic impact. Although not a precise 
predictor of the economic impact, we and an independent panel of 
experts assembled by DOD agree that the methodology used by DOD makes a 
reasonable attempt to measure economic impact of BRAC actions, both in 
terms of communities losing and gaining jobs as a result of BRAC 
actions.[Footnote 178]

Economic Impact Methodology: 

DOD assessed the economic impact of realignments and closures using a 
methodology that sought to estimate the total direct and indirect job 
changes. To perform its assessment, DOD established the Economic Impact 
Joint Process Action Team with members of the services and the Office 
of the Secretary of Defense (OSD) to develop an economic impact model 
for the services and joint cross-service groups to use as they 
considered potential recommendations. The team met many times to 
develop the economic methodology. We attended and observed those 
meetings as the methodology was developed. DOD also retained a private 
firm, Booz Allen Hamilton, to provide technical assistance in 
developing the methodology and computer database used by the military 
services and joint cross-service groups in calculating economic impacts 
in communities for which they were considering closure or realignment 
actions. 

Using a list of candidate bases provided by the representatives from 
each service and OSD, the primary counties in which the bases were 
located were derived and the regions of economic influence (economic 
areas) for those bases were determined from those counties.[Footnote 
179] The economic area for each base was defined as the Metropolitan 
Statistical Area (MSA) or Micropolitan Statistical Area in which the 
base's primary county or counties lie.[Footnote 180] For bases in MSAs 
that are divided into Metropolitan Divisions, the economic area is 
defined as the Metropolitan Division in which the base's primary county 
or counties lie.[Footnote 181] For bases in counties not in a MSA, 
Micropolitan Statistical Area, or a Metropolitan Division the economic 
area was defined as the county itself. 

The economic impact of a potential action on an area was measured in 
terms of direct and indirect job changes estimated from 2006 through 
2011 as shown below. 

Estimated Total Job Changes = Direct Job Changes x (1 + indirect 
multiplier + induced multiplier). 

Direct job changes are the estimated net addition or loss of jobs for 
military personnel, military students, civilian employees, and 
contractor mission support employees.[Footnote 182] The indirect job 
changes are the estimated net addition or loss of jobs in each economic 
area that could potentially occur as a result of the direct job 
changes. DOD considered two types of indirect job changes: (1) indirect 
job changes that are associated with the production of goods or the 
provision of services that are direct inputs to a product, such as a 
subcontractor producing components for a weapon system and (2) induced 
job changes that are affected as a result of local spending by direct 
and indirect workers, such as retail sales. 

DOD used multipliers to estimate the indirect and induced job changes. 
Employment multipliers for various civilian industry sectors were 
obtained from the Minnesota IMPLAN Group, Inc. (MIG) for each MSA, 
Micropolitan Statistical Area, Metropolitan Division, and county in 
which a candidate base was located.[Footnote 183] Indirect multipliers 
were estimated by mapping Military Occupational Specialties (MOSes) to 
economically similar civilian sectors.[Footnote 184] Each of these 
similar economic sectors multipliers were weighted by the number of 
military personnel mapped to each sector divided by the total number of 
employees in the sector. Examples of these economically similar sectors 
are educational services, administration and support services, 
scientific research and development services, aerospace product and 
parts manufacturing, and electronic repair and maintenance. Judgment 
was used to place all MOSes into one of the industrial sectors. A 
weighted average of the indirect multipliers, based on the weights 
discussed above, for each base was used to estimate the indirect job 
changes from military personnel. This weighted average of indirect 
multipliers used to estimate the military indirect multiplier for each 
base was used to estimate the indirect job changes from civilian 
personnel job changes, as well as the indirect job changes for mission-
support contractors for each base. 

Estimating the induced job changes from military and civilian job 
changes was more straightforward. For each economic area, MIG used one 
induced multiplier for military personnel job changes and one for 
nonmilitary government jobs changes. These multipliers were used to 
estimate the induced job changes for each base in that economic area. 
Summing the products of the weights for each of the civilian industries 
calculated for the military indirect multipliers, and the induced 
multipliers for each of the industries from MIG, produced the induced 
multiplier used for mission support contractor job changes. 

Because of a concern about the lower spending of military trainees at 
recruit training facilities, an adjustment was made to reduce the 
values of the induced multipliers used for job changes of military 
trainees at recruit training bases. The Economic Impact Joint Process 
Action Team was also concerned about overestimating induced job changes 
for military trainees at recruit training bases and thought that 
military trainees at such bases have a smaller economic impact than 
civilian employees and regular military personnel, including those 
military personnel who receive more advanced training. The team thought 
this because such students receive a relatively smaller income and are 
generally transient. Student multipliers for bases with recruit 
training programs were estimated by multiplying the military induced 
multiplier for an economic area by the ratio of basic training wages to 
average military wages (slightly more than a third). Student induced 
multipliers for bases without basic training programs were set equal to 
the military induced multiplier for the base's economic area. The team 
thought that these more advanced students were likely to have incomes 
and spending habits similar to the average military in the economic 
area. 

Some of the joint cross-service groups subsequently considered a small 
number of bases (leased spaces or Reserve/Guard centers) that were not 
included in the initial set of defined economic areas. For these 
economic areas, a generic set of multipliers was developed by averaging 
each of the multipliers of the five categories (military, civilian, 
contractor, student, and recruit training student) over the existing 
economic areas.[Footnote 185]

The calculation of job change either positive or negative could be 
performed in three ways: 

* by individual actions for one specific action for a base,

* by base (net result of multiple actions for a base), and: 

* by economic area (net result of all actions for the economic area). 

The total potential job change and the total potential job changes as a 
percentage of total in an economic area were to be considered in the 
context of historical economic data. For historical context, the 
services and the joint cross-service groups considered the following 
for each economic area: 

* total employment: 1988 to 2002,

* annual unemployment rates: 1990 to 2003, and: 

* real per capita income: 1988 to 2002. 

In addition, the latest available numbers on population would be 
provided. These dates were chosen to reflect the latest available data 
from federal sources. 

In the 1995 BRAC round, DOD developed a separate method of assessing 
cumulative economic impact because some of the closures and 
realignments from the prior rounds had not been fully implemented, so 
special consideration was given to the economic impacts that were yet 
to occur. However in 2005, given the passage of time since all four of 
the previous BRAC rounds, which extended from 1988 to 1995, and other 
factors contributing to changing economic conditions in the interim 
period, DOD decided not to consider the cumulative economic impact of 
the prior BRAC rounds in assessing the impact of the current round. We 
believe DOD's decision not to assess a cumulative economic impact for 
the 2005 round has merit. 

DOD had extensive documentation controls to protect how documents for 
economic impact were prepared, handled, and processed. Procedures were 
used to ensure that the inputs, such as the values of the multipliers, 
used to make calculations on job changes were correct. A review by 
qualified analysts who did not participate in the initial calculations 
was also conducted. 

Methodology Has Limitations but Is Reasonable for BRAC Purposes: 

DOD's approach to measuring economic impact did not measure all the 
dimensions of the economic impact coming from a BRAC action. There will 
be other economic impacts on the economic area, such as changes in the 
value of real estate or the value of businesses in the area. The DOD 
approach did not estimate these effects, but it is reasonable to assume 
that the magnitude of job losses would be correlated with the changes 
in these values. 

DOD's methodology does have some limitations. Specifically, it tended 
to overstate the employment impact for economic areas. One of DOD's 
goals for the methodology was to produce credible estimates but to err 
on the side of overstating the actual impacts in order to prevent 
others from arguing that DOD was underestimating economic impact. The 
Joint Process Action Team was aware that the methodology had factors 
that might offset the estimated job losses. For example, the 
methodology assumed that that jobs are lost all at once and does not 
recognize that employees may be released over the 6-year implementation 
period and be reemployed in other local businesses or outside the 
economic area, which would reduce the estimated job loss. The 
methodology does not recognize the possible civilian reuse of the 
affected base and the resulting reemployment of workers, which would 
reduce the estimated job losses. 

In examining the construction of the indirect multipliers, it is 
possible to question how they were created. The indirect multiplier 
being used to estimate job changes from military job changes for a base 
is constructed as a weighted average multiplier where the weights are 
the fraction of total base personnel being judged to be similar to a 
particular civilian industry. Questions could be raised about judgments 
made to map particular Military Occupation Specialties to activities in 
civilian industries. In some cases, the mapping from military jobs to 
industries was easier, such as military jobs in the medical area being 
mapped to the medical industry. However, in other areas where the jobs 
are uniquely military, such as infantry, the mapping would be more 
problematic. If a mistake was made in mapping a job that is uniquely 
military to a civilian sector, the result would depend on the relative 
size of the multiplier of the correct civilian sector versus the 
civilian sector used. It could lead to overestimation or 
underestimation of the indirect job change. Time did not permit us to 
examine this mapping. Nonetheless, we believe the overall approach 
seemed to be a sound attempt to produce a credible multiplier. 

Finally, in using the ratio of estimated job losses from 2006 through 
2011 to total employment as of 2002 (the latest figure for total 
employment) as a measure of economic impact, the economic impact was 
likely overstated. This occurs because total employment is likely to 
grow for many economic areas over the 2006-2011 implementation period 
as local economies grow, which would reduce the overall percentage of 
job losses. 

DOD's methodology for assessing economic impact was reviewed by an 
independent panel of four economists and policy analysts from the 
private and academic sectors in August 2004.[Footnote 186] DOD formed 
the panel of four members to review the methodology and to determine if 
it conformed to accepted economic practices. Three of the panel members 
were Ph.D. economists and the other was a policy analyst. All four were 
experienced in conducting local economic impact studies and were not 
otherwise associated with the BRAC process. The panel found the 
methodology to be reasonable. The experts agreed that the use of direct 
and indirect job changes was a logical method to characterize the 
impact of proposed closures and realignments. The reviewers also 
concluded that DOD's methodology represents a "worst-case" estimate of 
economic impact. We contacted each member of the panel to discuss their 
review of the methodology to ensure that DOD had adequately summarized 
the results of the panel meeting and that they agreed that the 
methodology was sound. We and the experts agreed that DOD had 
adequately summarized the review meeting and agreed that the 
methodology was reasonable to use. 

Economic Areas Most Impacted and Least Impacted by BRAC 
Recommendations: 

In examining the economic impact of the 222 proposed recommendations as 
measured by the percent of employment, most economic areas were 
affected very little. Almost 83 percent of the 244 economic areas 
affected by BRAC recommendations fell between a one percent loss and a 
one percent gain in employment.[Footnote 187] Slightly more than 9 
percent of the economic areas had a negative economic impact of greater 
than one percent. Almost 8 percent of the economic areas had a positive 
economic impact greater than one percent. Tables 45 and 46 show the 
five economic areas with the greatest negative employment change and 
the greatest positive employment change. 

Table 45: Five Economic Areas with the Greatest Negative Impact on 
Employment: 

Economic area: Clovis, NM Micropolitan Statistical Area; 
Changes as percentage of employment: -20.5%; 
Reason for change: Closure of Cannon Air Force Base, NM. 

Economic area: Martin County, IN; 
Changes as percentage of employment: -11.6%; 
Reason for change: Realignment of Naval Support Activity Crane, IN. 

Economic area: Norwich-New London, CT Metropolitan Statistical Area; 
Changes as percentage of employment: -9.4%; 
Reason for change: Closure of Submarine Base New London, CT. 

Economic area: Fairbanks, AK Metropolitan Statistical Area; 
Changes as percentage of employment: -8.6%; 
Reason for change: Realignment of Eielson Air Force Base, AK. 

Economic area: Rapid City, SD Metropolitan Statistical Area; 
Changes as percentage of employment: -8.5%; 
Reason for change: Closure of Ellsworth Air Force Base, SD. 

Source: DOD. 

Note: Subsequent to the issuance of the recommendations, DOD identified 
an error with the economic impact reported for Hawthorne Army Depot, 
Nevada. The revised economic impact is -13.6 percent of employment and 
not-0.1 percent as DOD initially reported. 

[End of table]

Table 46: Five Economic Areas with the Greatest Positive Economic 
Impact on Employment: 

Economic area: St. Mary's, GA Micropolitan Statistical Area; 
Changes as percentage of employment: 21.9%; 
Gaining installation: Submarine Base Kings Bay, GA. 

Economic area: Lawton, OK Metropolitan Statistical Area; 
Changes as percentage of employment: 9.0%; 
Gaining installation: Fort Sill, OK. 

Economic area: Columbus, GA-AL Metropolitan Statistical Area; 
Changes as percentage of employment: 8.5%; 
Gaining installation: Fort Benning, GA. 

Economic area: Enterprise-Ozark, AL Micropolitan Statistical Area; 
Changes as percentage of employment: 7.4%; 
Gaining installation: Fort Rucker, AL. 

Economic area: Manhattan, KS Micropolitan Statistical Area; 
Changes as percentage of employment: 6.5%; 
Gaining installation: Fort Riley, KS. 

Source: DOD. 

[End of table]

As noted in prior reports, we examined how the communities surrounding 
closed bases were faring in relation to two key national economic 
indicators--the national unemployment rate and the average annual real 
per capita income growth rate. In our last status report, we observed 
that most communities surrounding closed bases were faring well 
economically in relation to these key national economic indicators. 
While some communities surrounding closed bases were faring better than 
others, most have recovered or are continuing to recover from the 
impact of BRAC, with more mixed results recently, allowing for some 
negative impact from the 2001 recession. 

[End of section]

Appendix XV: Draft DOD Transformational Options Recommended for 
Approval: 

THE UNDER SECRETARY OF DEFENSE:
ACQUISITION, TECHNOLOGY AND LOGISTICS: 

3010 DEFENSE PENTAGON: 
WASHINGTON, DC 20301-3010: 

SEP 8 2004: 

MEMORANDUM FOR INFRASTRUCTURE STEERING GROUP MEMBERS CHAIRMEN, JOINT 
CROSS SERVICE GROUPS: 

SUBJECT: Transformational Options for BRAC 2005: 

The Secretary of Defense, in his November 15, 2002, memorandum 
initiating the BRAG process, asked for a broad series of options for 
stationing and supporting forces and functions to increase efficiency 
and effectiveness. The memo tasked the Infrastructure Steering Group to 
provide options to the Infrastructure Executive Council (IEC) for the 
Secretary's final approval. Once approved by the Secretary, these 
options will constitute a minimum analytical framework upon which the 
Military Departments and Joint Cross-Service Groups (JCSGs) will 
conduct their respective BRAC analyses. 

In my June 21, 2004, memorandum, I asked for a review of previously 
submitted options and/or for your suggested modifications, additions, 
or deletions. The BRAC Deputy Assistant Secretaries (DASs) participated 
in refining these submissions to eliminate duplications and to array 
them as transformational options recommended for approval or deletion 
based on whether the proposed option could be readily translated into 
scenarios, was actionable within the BRAC 2005 process, or possessed an 
identifiable effect on infrastructure. 

The attachment provides the list of transformational options 
categorized with a recommendation for approval or deletion to forward 
to the IEC. I would appreciate receiving your formal concurrence and 
comments on these lists by September 17, 2004. Please provide your 
input to Mr. Peter Potochney, Director, Base Realignment and Closure in 
Room 3D814. 

Signed by: 

Michael W. Wynne: 
Acting USD (Acquisition, Technology & Logistics): 
Chairman, Infrastructure Steering Group: 

Attachment As stated: 

Transformational Options: 

Recommend Approval: 

1. Consolidate Management at Installations with Shared Boundaries. 
Create a single manager for installations that share boundaries. Source 
& Application: H&SA. 

2. Regionalize Installation Support. Regionalize management of the 
provision of installation support activities across Military 
Departments within areas of significant Department of Defense (DoD) 
concentration, identified as Geographic Clusters. Option will evaluate 
designating organizations to provide a range of services, regionally, 
as well as aligning regional efforts to specific functions. For 
example, a possible outcome might be designation of a single 
organization with the responsibility to provide installation management 
services to DoD installations within the statutory National Capital 
Region (NCR). Source and Application: H&SA. 

3. Consolidate or collocate Regional Civilian Personnel Offices to 
create joint civilian personnel centers. Source and Application: H&SA. 

4. Consolidate active and Reserve Military Personnel Centers of the 
same service. Source and Application: H&SA. 

5. Collocate active and/or Reserve Military Personnel Centers across 
Military Departments. Source and Application: H&SA. 

6. Consolidate same service active and Reserve local Military Personnel 
Offices within Geographic Clusters. Source and Application: H&SA. 

7. Collocate active and/or Reserve local Military Personnel Offices 
across Military Departments located within Geographic Clusters. Source 
and Application: H&SA. 

8. Consolidate Defense Finance and Accounting Service (DFAS) Central 
and Field Sites. Consolidate DFAS business line workload and 
administrative/staff functions and locations. Source and Application: 
H&SA. 

9. Consolidate Local DFAS Finance & Accounting (F&A). Merge/consolidate 
local DFAS F&A within Geographic Clusters. Source and Application: 
H&SA. 

10. Consolidate remaining mainframe processing and high capacity data 
storage operations to existing Defense Mega Centers (Defense Enterprise 
Computing Centers). Source and Application: H&SA. 

11. Establish and consolidate mobilization sites at installations able 
to adequately prepare, train and deploy service members. Source and 
Application: H&SA. 

12. Establish joint pre-deployment/re-deployment processing sites. 
Source and Application: H&SA. 

13. Rationalize Presence in the DC Area. Assess the need for 
headquarters, commands and activities to be located within 100 miles of 
the Pentagon. Evaluation will include analysis of realignment of those 
organizations found to be eligible to move to DoD-owned space outside 
of a 100-miles radius. Source and Application: H&SA. 

14. Minimize leased space across the US and movement of organizations 
residing in leased space to DoD-owned space. Source and Application: 
H&SA. 

15. Consolidate HQs at Single Locations. Consolidate multi-location 
headquarters at single locations. Source and Application: H&SA. 

16. Eliminate locations of stand-alone headquarters. Source and 
Application: H&SA. 

17. Consolidate correctional facilities into fewer locations across 
Military Departments. Source and Application: H&SA. 

18. Collocate Reserve Component (RC) Headquarters. Determine 
alternative facility alignments to support RC headquarters' 
administrative missions. Alternatives could consider collocation and/or 
movement of RC headquarters to operational bases. Source: H&SA; 
Application: MILDEPS. 

19. Collocate Recruiting Headquarters. Analyze alternative Recruiting 
Headquarters alignments. Consider co-location of RC and Active 
Component (AC) Recruiting headquarters. Source and Application: H&SA. 

20. Establish a consolidated multi-service supply, storage and 
distribution system that enhances the strategic deployment and 
sustainment of expeditionary joint forces worldwide. Focus the analysis 
on creating joint activities in heavy (US) DoD concentration areas, 
i.e. locations where more than one Department is based and within close 
proximity to another. Source: Supply & Storage; Application: Supply and 
Storage and Industrial. 

21. Privatize the wholesale storage and distribution processes from DoD 
activities that perform these functions. Source and Application: Supply 
& Storage. 

22. Migrate oversight and management of all service depot level 
reparables to a single DoD agency/activity. Source and Application: 
Supply & Storage. 

23. Decentralize Depot level maintenance by reclassifying work from 
depot-level to I-level. Source and Application: Industrial. 

24. Centralize I-level maintenance and decentralize depot-level 
maintenance to the existing (or remaining) depots. 

* Eliminate over-redundancy in functions. 

* Consolidate Intermediate and Depot-level regional activities Source 
and Application: Industrial. 

25. Regionalize severable and similar work at the intermediate level. 
Source and Application: Industrial. 

26. Partnerships Expansions. Under a partnership, have government 
personnel work in contractor owned/leased facilities and realign or 
close facilities where personnel are currently working. Source and 
Application: Industrial. 

27. Collocate depots: Two Services use the same facility(s). Separate 
command structures but shared common operations. Source and 
Application: Industrial. 

28. Consolidate similar commodities under Centers of Technical 
Excellence. Source and Application: Industrial. 

29. Implement concept of Vertical Integration by putting entire life 
cycle at same site to increase synergies, e.g. production of raw 
materials to the manufacture of finished parts, co-locating storage, 
maintenance and demil. Source and Application: Industrial. 

30. Implement concept of Horizontal Integration by taking some of the 
most costly elements of the M&A processes and put them at the same site 
to increase efficiencies, e.g. put Load, Assemble and Pack (LAP) of all 
related munitions at same site. Source and Application: Industrial. 

31. Maintain a multi-service distribution and deployment network 
consolidating on regional joint service nodes. Source and Application: 
Industrial. 

32. Evaluate Joint Centers for classes and types of weapons systems 
and/or technologies used by more than one Military Department. 

* Within a Defense Technology Area Plan (DTAP) Capability Area. 

* Across multiple functions (Research; Development & Acquisition; Test 
& Evaluation). 

* Across multiple DTAP capability areas. Source and Application: 
Technical. 

33. Evaluate Service-Centric concentration, i.e. consolidate within 
each Service. 

* Within a Defense Technology Area Plan (DTAP) capability area. 

* Across multiple functions (Research; Development & Acquisition; Test 
& Evaluation). 

* Across multiple DTAP capability areas. Source and Application: 
Technical. 

34. Privatize graduate-level education. Source and Application: 
Education & Training. 

35. Integrate military and DoD civilian full-time professional 
development education programs. Source and Application: Education & 
Training. 

36. Establish Centers of Excellence for Joint or Inter-service 
education and training by combining or co-locating like schools (e.g., 
form a "DoD University" with satellite training sites provided by 
Service-lead or civilian institutions). Source and Application: 
Education & Training. 

37. Establish "joint" officer and enlisted specialized skill training 
(initial skill, skill progression & functional training). Source and 
Application: Education & Training. 

38. Establish a single "Center of Excellence" to provide Unmanned 
Aerial Vehicle initial (a.k.a. undergraduate) training. Source and 
Application: Education & Training. 

39. Establish regional Cross-Service and Cross-Functional ranges that 
will support Service collective, interoperability and joint training as 
well as test and evaluation of weapon systems. Source and Application: 
Education & Training. 

40. Integrate selected range capabilities across Services to enhance 
Service collective, interoperability and joint training, such as Urban 
Operations, Littoral, training in unique settings (arctic, mountain, 
desert, and tropical). Source and Application: Education & Training. 

41. Combine Services' T&E Open Air Range (OAR) management into one 
joint management office. Although organizational/managerial, this 
option could engender further transformation. Joint management of OAR 
resources could encourage a healthy competition among OARs to increase 
efficiency and maximum utility DoD-wide. Source and Application: 
Education & Training. 

42. Consolidate or collocate at a single installation all services' 
primary phase of pilot training that uses the same aircraft (T-6). 
Source and Application: Education & Training. 

43. Locate (division/corps) UEx and (corps/Army) UEy on Joint bases 
where practical to leverage capabilities of other services (e.g., 
strategic lift to enhance strategic responsiveness). Source and 
Application: Army. 

44. Locate (brigades) Units of Action at installations DoD-wide, 
capable of training modular formations, both mounted and dismounted, at 
home station with sufficient land and facilities to test, simulate, or 
fire all organic weapons. Source and Application: Army. 

45. Collocate Army War College and Command and General Staff College at 
a single location. Source: Army; Application: Education & Training. 

46. Locate Special Operations Forces (SOF) in locations that best 
support specialized training needs, training with conventional forces 
and other service SOF units and wartime alignment deployment 
requirements. Source and Application: Army. 

47. Collocate or consolidate multiple branch schools and centers on 
single locations (preferably with MTOE units and RDTE facilities) based 
on warfighting requirements, training strategy, and doctrine, to gain 
efficiencies from reducing overhead and sharing of program-of-
instruction resources. Source and Application: Army. 

48. Reshape installations, RC facilities and RC major training centers 
to support home station mobilization and demobilization and implement 
the Train/Alert/Deploy model. Source and Application: Army. 

49. Increase the number of multi-functional training areas able to 
simultaneously serve multiple purposes and minimize the number of 
single focus training areas for the Reserve Components where possible. 
Source and Application: Army. 

50. Collocate institutional training, MTOE units, RDTE organizations 
and other TDA units in large numbers on single installations to support 
force stabilization and enhance training. Army. 

51. Locate units/activities to enhance home station operations and 
force protection. Source and Application: Army. 

52. Consolidate aviation training with sister services for like-type 
aircraft to gain efficiencies. Source: Army; Application: all services. 

53. Collocate functions and headquarters in "Joint Campuses" to enhance 
interoperability and reduce costs. Source: Army; Application: H&SA. 

54. Consolidate Army RDT&E organizations to capitalize on technical 
synergy across DoD, academia and industry. Source: Army; Application: 
Technical. 

55. Reduce the number of USAR regional headquarters to reflect Federal 
Reserve Restructuring Initiative (FRRI). Source and Application: Army. 

56. Consolidate RDT&E functions on fewer installations through inter-
service support agreements to enable multidisciplinary efforts to 
increase efficiencies and reduce redundancy within DoD. Source: Army; 
Application: Technical, MilDeps. 

57. Establish a single inventory control point (ICP) within each 
Service or consolidating into joint ICPs. Application: Supply and 
Storage. 

58. Expand Guard and Reserve force integration with the Active force. 
Examples: 

(1) Blended organizations, 

(2) Reserve Associate, Guard Associate, and Active Associate, 

(3) Sponsored Reserve, 

(4) Blending of Guard units across state lines to unify mission areas, 
reduce infrastructure, and improve readiness. Application: MilDeps. 

59. Consolidate National Capital Region (NCR) intelligence community 
activities now occupying small government facilities and privately 
owned leased space to fewer, secure DoD-owned locations in the region. 
Application: Intel. 

60. Collocate Guard and Reserve units at active bases or consolidate 
the Guard and Reserve units that are located in close proximity to one 
another at one location if practical, i.e., joint use facilities. 
Application: MilDeps. 

61. Consolidate the Army's five separate Active Component recruit 
training sites and the Marine Corps' two Active Component recruit 
training sites into one recruit training installation each. Source: 
Education and Training; Application: Army & Marine Corps. 

62. Privatize Household Goods and Personal Property Shipping function. 
Source: BENS; Application: Supply and Storage, MilDeps. 

63. Privatize long-haul communications in the Defense Information 
Systems Agency (DISA). Source: BENS; Application: H&SA. 

64. Collocate Joint Strike Fighter graduate flight training and 
maintenance training. 

65. Collocate Joint Strike Fighter graduate flight training. 

66. Collocate Joint Strike Fighter maintenance training. 

67. Consolidate aviation assets of two or more Military Services on the 
same base. Application: MilDeps. 

68. Collocate Service special operations units where they further 
reduce infrastructure requirements and enable improved training 
opportunities. 

69. Collocate Service Professional Military Education (PME) schools at 
the intermediate and senior levels. Application: E&T. 

70. Consolidate/Collocate Service specific test pilot schools. 
Application: MilDeps. 

71. Collocate ground and signals intelligence systems. Application: 
Intel & MilDeps. 

72. Collocate ground and airborne intelligence systems. Application: 
Intel & MilDeps. 

73. Consolidate pilot training and maintenance training for rotary wing 
and fixed wing aircraft using Executive Agency. Application: Education 
and Training. 

74. Each Military Department and Joint Cross Service Group will look at 
the effects of either reducing their functions by 20%, 30%, and 40% 
from the current baseline, or reducing excess capacity by an additional 
5% beyond the analyzed excess capacity, whichever is greater. The 
objective of this analysis is to uncover ways in which additional gains 
could be achieved, rather reasons why they could not. Source: DON; 
Application: MilDeps and JCSGs. 

75. Establish a "space test range" for satellite ground testing, threat 
assessment, and tactics development. Elements of the "range" should be 
networked using a minimum number of ground facilities to virtually 
simulate on-orbit operations. Source and Application: Air Force. 

76. Establish an Army Joint Network Science Technology and 
Experimentation Center to fully realize the transformational 
capabilities of interdependent Joint Network Centric Warfare. Source: 
Army; Application: Technical. 

77. Air Force use optimum flying squadron sizing and organizational 
constructs to disproportionately increase combat capability and 
transform the capability of its AEFs. Source and Application: Air 
Force. 

[End of section]

Appendix XVI: Key GAO and Other Defense Audit Agency Products Related 
to DOD's 2005 Base Realignments and Closures: 

Government Accountability Office: 

Military Base Closures: Observations on Prior and Current BRAC Rounds. 
[Hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO-05-614] 
Washington, D.C.: May 3, 2005. 

Military Base Closures: Updated Status of Prior Base Realignments and 
Closures. 
[Hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO-05-138] 
Washington, D.C.: January 13, 2005. 

Military Base Closures: Assessment of DOD's 2004 Report on the Need for 
a Base Realignment and Closure Round. 
[Hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO-04-760] 
Washington, D.C.: May 17, 2004. 

Military Base Closures: Observations on Preparations for the Upcoming 
Base Realignment and Closure Round. 
[Hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO-04-558T] 
Washington, D.C.: March 25, 2004. 

Military Base Closures: DOD's Updated Net Savings Estimate Remains 
Substantial. 
[Hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO-01-971] 
Washington, D.C.: July 31, 2001. 

Military Bases: Lessons Learned from Prior Base Closure Rounds. 
[Hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO/NSIAD-97-151] 
Washington, D.C.: July 25, 1997. 

Military Bases: Analysis of DOD's 1995 Process and Recommendations for 
Closure and Realignment. 
[Hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO/NSIAD-95-133] 
Washington, D.C.: April 14, 1995. 

Department of Defense Office of Inspector General: 

Infrastructure and Environment: Technical Joint Cross-Service Group 
Data Integrity and Internal Control Processes for Base Realignment and 
Closure 2005. D-2005-086. Washington, D.C.: June 17, 2005. 

Defense Infrastructure: Education and Training Joint Cross-Service 
Group Data Integrity and Internal Control Processes for Base 
Realignment and Closure 2005. D-2005-084. Arlington, Va.: June 10, 
2005. 

Defense Infrastructure: Industrial Joint Cross-Service Group Data 
Integrity and Internal Control Processes for Base Realignment and 
Closure 2005. D-2005-082. Arlington, Va.: June 9, 2005. 

Infrastructure and Environment: Washington Headquarters Services Data 
Call Submissions and Internal Control Processes for Base Realignment 
and Closure 2005. D-2005-079. Arlington, Va.: June 8, 2005. 

Defense Infrastructure: Supply and Storage Joint Cross-Service Group 
Data Integrity and Internal Control Processes for Base Realignment and 
Closure 2005. D-2005-081. Arlington, Va.: June 6, 2005. 

Infrastructure and Environment: Defense Finance and Accounting Service 
Data Call Submissions and Internal Control Processes for Base 
Realignment and Closure 2005. D-2005-075. Arlington, Va.: May 27, 2005. 

DOD Inspector General plans to issue reports on the Defense Logistics 
Agency, the Headquarters and Support Activities Joint Cross-Service 
Group, and the Medical Joint Cross-Service Group. 

Department of the Army U.S. Army Audit Agency: 

Reserve Component Process Action Team, The Army Basing Study 2005. A-
2005-0165-ALT. Alexandria, Va.: April 29, 2005. 

The Army Basing Study 2005 Process. A-2005-0164-ALT. Alexandria, Va.: 
April 22, 2005. 

Validation of Army Responses for Joint Cross-Service Group Questions. A-
2005-0169-ALT. Alexandria, Va.: April 22, 2005. 

Army Military Value Data, The Army Basing Study 2005. A-2005-0083-ALT. 
Alexandria, Va.: December 21, 2004. 

Army Capacity Data, The Army Basing Study 2005. A-2005-0056-ALT. 
Alexandria, Va.: November 30, 2004. 

Cost of Base Realignment Actions (COBRA) Model. A-2004-0544-IMT. 
Alexandria, Va.: September 30, 2004. 

Department of the Navy Naval Audit Service: 

The Department of the Navy's Implementation of the FY 2005 Base 
Realignment and Closure Process. N2005-0046. Washington, D.C.: June 10, 
2005. 

Risk Assessment of the Department of the Navy Base Realignment and 
Closure 2005 Information Transfer System. N2005-0042. Washington, D.C.: 
April 25, 2005. 

Base Realignment and Closure Optimization Methodology. N2004-0058. 
Washington, D.C.: June 16, 2004. 

Department of the Air Force Air Force Audit Agency: 

BRAC Cueing and Analysis Tools. F2005-0007-FB2000. Washington, D.C.: 
June 22, 2005. 

2005 Base Realignment and Closure-Installation Visualization Tool Data 
Reliability. F2005-0004-FB4000. Washington, D.C.: June 16, 2005. 

Base Realignment and Closure Data Collection System. F2004-0008-
FB40000. Washington, D.C.: September 27, 2004. 

2005 Base Realignment and Closure: Installation Capacity Analysis 
Questionnaire. F2004-0007-FB4000. Washington, D.C.: August 24, 2004. 

2005 Base Realignment and Closure: Installations Inventory. F2004-0005-
FB4000. Washington, D.C.: April 12, 2004. 

2005 Base Realignment and Closure: Air Force Internal Control Plan. 
F2004-0001-FB4000. Washington, D.C.: December 29, 2003. 

The Air Force Audit Agency plans to release 7 additional reports on the 
Air Force and joint cross-service group data collection, the Air Force 
analysis, and the use of various BRAC tools. 

[End of section]

Appendix XVII: GAO Contact and Staff Acknowledgments: 

GAO Contact: 

Barry W. Holman (202) 512-5581: 

Acknowledgments: 

In addition to the individual named above, Mike Kennedy, Jim 
Reifsnyder, Nelsie Alcoser, Shawn Arbogast, Raymond Bickert, Alissa 
Czyz, Andrew Edelson, Glenn Knoepfle, Nancy Lively, Warren Lowman, Tom 
Mahalek, David Mayfield, Richard Meeks, Hilary Murrish, Charles Perdue, 
Robert Poetta, James Reynolds, Laura Talbott, and Cheryl Weissman made 
key contributions to this report. 

Other individuals also contributing to this report included, Tommy 
Baril, Carl Barden, Angela Bourciquot, Steve Boyles, Delaney Branch, 
Joel Christenson, Kenneth Cooper, Paul Gvoth, Larry Junek, Mark Little, 
Philip Longee, Ricardo Marquez, Gary Phillips, Greg Pugnetti, Sharon 
Reid, John Strong, Roger Tomlinson, and Kimberly Young. 

(350443): 

FOOTNOTES

[1] Definitions of closures and realignments and other BRAC-related 
terms are included in app. II. 

[2] DOD defines plant replacement value as the cost to replace an 
existing facility with a facility of the same size at the same 
location, using today's building standards. 

[3] P.L. 107-107, Title XXX (Dec. 28, 2001). 

[4] P.L. 101-510, Title XXIX (Nov. 5, 1990); 10 U.S.C. 2687, note. 

[5] Once the recommendations become binding, DOD must initiate closure 
or realignment actions no later than 2 years and complete these actions 
within 6 years from the date the President transmits his report to 
Congress. P.L. 101-510, section 2904. 

[6] The seven joint cross-service groups were Education and Training; 
Headquarters and Support Activities; Industrial; Intelligence; Medical; 
Supply and Storage; and Technical. 

[7] The reserve components consist of the Army National Guard of the 
United States, the Army Reserve, the Naval Reserve, the Marine Corps 
Reserve, the Air National Guard of the United States, the Air Force 
Reserve, and the Coast Guard Reserve. 

[8] In the context of BRAC, net present value is taking into account 
the time value of money in calculating the value of future cost and 
savings. 

[9] During the BRAC process, data were certified by senior officials at 
DOD installations. Each official certified that the information was 
accurate and complete to the best of his or her knowledge and belief. 

[10] P.L. 101-510, section 2912(a)(1)(A) required DOD to develop a 20-
year force structure plan as the basis for its BRAC analysis. 

[11] Candidate recommendations refer to proposed recommendations that 
were approved by either the military services or joint cross-service 
groups and forwarded for review to DOD's Infrastructure Steering Group 
and Infrastructure Executive Council. 

[12] P.L. 107-107, Title XXX (Dec. 28, 2001). 

[13] P.L. 101-510, Title XXIX (Nov. 5, 1990); 10 U.S.C. 2687 note. 

[14] This contrasts with secretarial guidance issued in January 1994, 
initiating the 1995 BRAC round, which established the goal of reducing 
domestic base structure by a minimum of 15 percent of DOD-wide plant 
replacement value. The Secretary of Defense indicated in a March 2004 
report to Congress that DOD likely had about 24 percent excess facility 
capacity going into the 2005 BRAC round. 

[15] DOD broadly defines transformation as "a process that shapes the 
changing nature of military competition and cooperation through new 
combinations of concepts, capabilities, people and organizations that 
exploit our nation's advantages and protect against asymmetric 
vulnerabilities to sustain our strategic position, which helps underpin 
peace and stability in the world." Examples of draft transformational 
options included (1) consolidate management at installations with 
shared boundaries and (2) establish regional cross-service and cross-
functional ranges that will support service, collective, 
interoperability, and joint training, as well as test and evaluation of 
weapon systems. 

[16] P.L. 108-375, section 2832 (Oct. 28, 2004). 

[17] In this report, we refer to the selection criteria by the 
numbering method used by DOD instead of the specific statutory 
provisions detailing these criteria as contained in P.L. 101-510, 
section 2913. 

[18] Payback period is defined as the number of years, beginning with 
the date of completion of a closure or realignment, required for 
cumulative estimated savings to exceed cumulative estimated costs 
incurred in net present value terms as a result of implementing a BRAC 
action. 

[19] Besides the 50 states, this also includes the District of 
Columbia; the Commonwealth of Puerto Rico; Guam; the Virgin Islands; 
American Samoa; and any other commonwealth, territory, or possession of 
the United States. P.L. 101-510, section 2910(7). 

[20] The Commission on Review of Overseas Military Facility Structure 
of the United States, also known as the Overseas Basing Commission. See 
P.L. 108-132, section 128 (Nov. 22, 2003). 

[21] Commission on Review of Overseas Military Facility Structure of 
the United States (Washington, D.C.: May 9, 2005). 

[22] We most recently reported that these costs were $23.3 billion 
through fiscal year 2003 and they excluded an estimated $3.6 billion in 
costs that are needed to complete environmental cleanup at BRAC bases 
in future years. Also, they did not include about $1.9 billion in costs 
incurred by other DOD and federal agencies to provide assistance to 
communities and individuals impacted by BRAC as a result of prior BRAC 
rounds. 

[23] Sustainment refers to recurring maintenance and repair activities 
necessary to keep facilities in good working order. Recapitalization 
refers to major renovation or reconstruction activities (including 
facility replacement) needed to keep facilities modern and efficient in 
an environment of changing standards and missions. Base operating 
support refers to a collection of day-to-day programs, activities, and 
services, such as food services, grounds maintenance, and custodial 
services, needed to keep the bases and installations in running order. 

[24] These projections exclude environmental restoration costs, which 
historically have not been included in BRAC costs and savings analyses 
because restoration is a liability that exists regardless of whether a 
base is closed, but are included in implementation budgets once BRAC 
recommendations have become binding. 

[25] GAO, Military Bases: Analysis of DOD's 1995 Process and 
Recommendations for Closure and Realignment, GAO/NSIAD-95-133 
(Washington, D.C.: Apr. 14, 1995). 

[26] The sites are the Newport Chemical Depot, Indiana; Umatilla 
Chemical Depot, Oregon; and Deseret Chemical Depot, Utah. 

[27] Performance-based logistics is defined as the purchase of weapon 
system sustainment as part of an integrated weapon system package based 
on output measures, such as weapon system availability, rather than 
input measures, such as parts and technical services. 

[28] Performance-based agreements are defined as the negotiated 
agreements between the major stakeholders that formally document the 
performance and support expectations and resources to achieve the 
desired outcome. 

[29] These functions could include such areas as real property 
management and maintenance, utilities, housing, emergency services, 
environmental services, base security, reserve component support, 
resource management, procurement, personal property management, 
transportation, equipment maintenance, retail supply, base 
communications, audio/visual services, personnel and professional 
support, personnel services, food services, laundry services, education 
services, personal and family services, recreation, military exchange 
operations, airfield operations, garrison operations, internal review, 
inspector general, and strategic planning. 

[30] Each official who submitted data for BRAC analysis certified that 
the information was accurate and complete to the best of his or her 
knowledge and belief. 

[31] Noted by the Secretary of Defense in his testimony before the BRAC 
Commission on May 16, 2005. 

[32] Homeland defense and surge considerations are in the military 
value selection criteria 2 and 3, respectively, as reflected in P.L. 
101-510, section 2913(b)(2)&(3). 

[33] Modularity refers to the Army Modular Force Initiative whereby the 
Army is transforming its force structure by increasing from 67 brigade 
combat teams to 77 modular brigade combat teams (43 active Army and 34 
Army National Guard) with the potential for 48 active Army modular 
brigade combat teams. 

[34] DOD's antiterrorism standards, effective no later than October 
2009, apply to both new and existing DOD-inhabited buildings and 
require, for example, minimum building standoff distances; structures 
that will avoid progressive building collapse; reinforced exterior 
walls; glazed windows, skylights, and doors; and properly secured 
entrances. Unified Facilities Criteria, 4-010-01 (Oct. 8, 2003). 

[35] P.L. 101-510, section 2913(e). 

[36] GAO, Military Base Closures: Updated Status of Prior Base 
Realignments and Closures, GAO-05-138 (Washington, D.C.: Jan. 13, 
2005). 

[37] Economic development conveyances are used to transfer unneeded 
property to communities for uses that promote economic recovery and job 
creation. The National Defense Authorization Act for Fiscal Year 2002 
(P.L. 107-107, Title XXX, section 3006 (Dec. 28, 2001)) included a 
provision stipulating that DOD seek to obtain fair market value for 
BRAC-related transfers of property in the 2005 round. The effect this 
provision will have on the generation of revenue for DOD is unknown at 
this time. 

[38] Some of the recommendations had multiple actions that affected 
more than one economic area. 

[39] GAO, Military Base Closures: Updated Status of Prior Base 
Realignments and Closures, GAO-05-138 (Washington, D.C.: Jan. 13, 
2005); GAO, Military Base Closures: Progress in Completing Actions from 
Prior Realignments and Closures, GAO-02-433 (Washington, D.C.: Apr. 5, 
2002); and GAO, Military Bases: Status of Prior Base Realignment and 
Closure Rounds, GAO/NSAID-99-36 (Washington, D.C.: Dec. 11, 1998). 

[40] GAO, DOD Schools: Limitations in DOD-Sponsored Study on Transfer 
Alternatives Underscore Need for Additional Assessment, GAO-05-469 
(Washington, D.C.: Apr. 26, 2005). 

[41] The medical group developed this candidate recommendation with the 
knowledge of a specific provision of federal law (10 U.S.C. 2112a) that 
could preclude closure of the university. 

[42] See GAO, Budget Issues: Budgetary Implications of Selected GAO 
Work for Fiscal Year 2001, GAO/OCG-00-8 (Washington, D.C.: Mar. 31, 
2000); GAO, Budget Issues: Budgetary Implications of Selected GAO Work 
for Fiscal Year 2000, GAO/OCG-99-26 (Washington, D.C.: Apr. 16, 1999); 
and GAO, Military Physicians: DOD's Medical School and Scholarship 
Program, GAO/HEHS-95-244 (Washington, D.C.: Sept. 29, 1995). 

[43] The Grand Forks Air Force Base recommendation also includes the 
realignment of McConnell Air Force Base, Kansas. 

[44] The joint cross-service groups were Education and Training, 
Headquarters and Support Activities, Industrial, Intelligence, Medical, 
Supply and Storage, and Technical. 

[45] See app. XVI for a list of relevant DOD Inspector General and 
military service audit reports that were available at the time we 
completed our review. 

[46] BRAC legislation establishes specific thresholds that require 
decisions regarding the closure or realignment of U.S. domestic 
military installations to be made under the BRAC process. Accordingly, 
decisions to close domestic U.S. military installations with 
authorization for at least 300 civilian personnel or to realign 
domestic U.S. military installations authorized at least 300 civilian 
personnel that involve a reduction of more than 1,000 or 50 percent in 
the number of civilian personnel authorized must undergo the BRAC 
process. See P.L. 101-510, section 2909. 

[47] The Integrated Global Presence and Basing Strategy (IGPBS) refers 
to DOD's effort to evaluate the global posture of the armed forces, 
which in part recommended the return of U.S. forces from Europe and 
Korea. The Army's BRAC 2005 report indicates that had it been able to 
include savings expected from closing overseas bases and restationing 
overseas-based personnel to the United States, its recommendations 
related to these actions would have achieved a net savings. However, 
DOD determined, and we agree, that the inclusion of such savings based 
on overseas base closures in BRAC is not appropriate, because the BRAC 
process was established to consider only the closure or realignment 
actions involving domestic U.S. military installations and not U.S. 
military installations located in foreign countries. 

[48] At OSD, the Infrastructure Steering Group (ISG) and the 
Infrastructure Executive Council (IEC) provided overall coordination 
and direction to the DOD-wide process. 

[49] In a May 2003 report, we noted the challenges that the Army faces 
in the funding of its reserve component facilities due to budget 
coordination difficulties. See GAO, Defense Infrastructure: Changes in 
Funding Priorities and Management Processes Needed to Improve Condition 
and Reduce Costs of Guard and Reserve Facilities, GAO-03-516 
(Washington, D.C.: May 15, 2003). According to Army officials, BRAC 
provides them an opportunity to overcome these challenges. 

[50] Modularity refers to the Army Modular Force Initiative whereby the 
Army is transforming its force structure by increasing from 67 brigade 
combat teams to 77 modular brigade combat teams (43 active Army and 34 
Army National Guard) with the potential for 48 active Army modular 
brigade combat teams. 

[51] DOD defines transformation as "a process that shapes the changing 
nature of military competition and cooperation through new combinations 
of concepts, capabilities, people and organizations that exploit our 
nation's advantages and protect against asymmetric vulnerabilities to 
sustain our strategic position, which helps underpin peace and 
stability in the world."

[52] The nine installations were Holston, Radford, and Lake City Army 
Ammunition Plants; Watervliet Arsenal; Military Ocean Terminal Sunny 
Point; Forts Myer and Detrick; and Tripler and Walter Reed Army Medical 
Centers. 

[53] These recommendations represent only those produced by the Army as 
detailed in DOD's 2005 BRAC report. In addition, the various joint 
cross-service groups produced various recommendations that affected 
Army installations. Those recommended actions are detailed in the 
appropriate appendices in this report. 

[54] For purposes of BRAC 2005 actions, the United States is defined 
under P.L. 101-510, section 2910(7) as the 50 states, District of 
Columbia, the Virgin Islands, American Samoa, Commonwealth of Puerto 
Rico, and any other commonwealth, territory, or possession of the 
United States. 

[55] In addition, some of these armed forces reserve centers are 
expected to include some reserve activities from the other services. 

[56] According to Army officials, the return of 15,000 soldiers was 
directly incorporated into the Army's BRAC recommendations, including 
the 1ST Armored Division headquarters and three heavy maneuver brigades 
from Germany to Fort Bliss, the 1ST Infantry Division headquarters, 
division support command, and aviation brigade to Fort Riley, and 
military police, engineer, and logistical units to Fort Knox, Kentucky. 
The Army also validated existing plans to restation about 10,000 
soldiers to Schofield Barracks, Hawaii; Fort Lewis, Colorado; and Fort 
Carson, Colorado. The remaining 22,000 soldiers will return to the 
United States individually to be restationed as part of the Army's 
force restructuring effort (called modularity). 

[57] The Army's current modular force restructuring plan calls for the 
creation of ten modular brigades within the United States by year 2006, 
with the possibility of an additional five modular brigades beyond 
then. As part of its BRAC analysis, the Army validated existing 
stationing decisions for five of the ten new modular brigades and 
incorporated the stationing of the remaining five modular brigades into 
four of its BRAC recommendations. 

[58] This commission, also known as the Overseas Basing Commission, was 
established by Congress in 2003. See P.L. 108-132, section 128 (Nov. 
22, 2003). It was created to evaluate, among other things, the current 
and proposed overseas basing structure of the U.S. military forces. The 
Commission's observations are included in the Report of the Commission 
on Review of the Overseas Military Facility Structure of the United 
States (Washington, D.C.: May 9, 2005). 

[59] GAO, Force Structure: Preliminary Observations on Army Plans to 
Implement and Fund Modular Forces, GAO-05-443T (Washington, D.C.: Mar. 
16, 2005). 

[60] GAO, Military Training: Better Planning and Funding Priority 
Needed to Improve Conditions of Military Training Ranges, GAO-05-534 
(Washington, D.C.: June 10, 2005). 

[61] At OSD, the Infrastructure Steering Group (ISG) and the 
Infrastructure Executive Council (IEC) provided overall coordination 
and direction to the DOD-wide process. 

[62] The hangar module is defined as the hangar space, line space, 
administrative space, and maintenance shop space required to house on 
aircraft squadron. There are two types of hangar modules used: Type I, 
which supports carrier-based fixed wing aircraft and helicopters, and 
Type II, which supports larger aircraft. 

[63] That concept is a single metric that considered berthing capacity 
for all Navy surface ships normalized to the Cruiser class of ship. 
They must have cold-iron, homeport capability and must meet shore power 
quality and quantity requirements, water and sewage requirements, and 
channel depth and height restrictions. For example, an aircraft carrier 
equals four cruiser equivalents. 

[64] The capacity analysis for surface/subsurface activities considered 
all naval activities that reported cruiser-equivalent berthing 
capability except for the Naval District of Washington, Naval Support 
Activity New Orleans, and the Nuclear Power Training Unit, Charleston. 
These activities were excluded because they have limited capability and 
viability to homeport naval vessels. 

[65] The analysis showed no excess capacity for munitions throughput 
and showed excess capacity for storage. 

[66] The Naval Audit Service visited 214 sites, covering 45 data calls, 
and audited 8,338 questions. 

[67] A model developed by the Center for Naval Analysis, which was used 
in BRAC 1995 and updated for BRAC 2005. The model met operational 
requirements and policy considerations by incorporating "rules" or 
"constraints" for functions so that the model would not select an 
operationally infeasible solution. For example, if the East Coast naval 
bases had enough berthing capacity to handle all of the ships in the 
force structure plan, the model could place all the ships at those 
bases and suggest closure of all of the West Coast and Pacific bases, 
which would be unacceptable. Therefore, the surface/subsurface 
operations portion of the model included a constraint that at least 40 
percent of the surface/subsurface ship be located on each coast. 

[68] Costs associated with moving a carrier strike group to Pearl 
Harbor, Hawaii, were projected to be from $2.6 to $3.1 billion. Cost 
for moving it to Guam were projected to be from $4 billion to $6.6 
billion. 

[69] The other shipyards that perform depot level ship refueling, 
modernization overhaul, and repair work are Norfolk, Pearl Harbor, and 
Puget Sound. 

[70] Legislation is currently pending in Congress that would not allow 
the Navy to decommission the U.S.S. John F. Kennedy. See H.R. 1815, 
109th Congress, section 127 (2005). 

[71] A commodity is a generic grouping of the types of depot and 
maintenance work associated with end items, weapons systems, or major 
processes, for example, cranes and rigging, electronics, forge, nuclear 
testing, or welding. 

[72] At OSD, the Infrastructure Steering Group (ISG) and the 
Infrastructure Executive Council (IEC) provided overall coordination 
and direction to the DOD-wide process. 

[73] Department of the United States Air Force, Expeditionary Air Force 
Principles White Paper (Washington, D.C.: July 14, 2004). 

[74] Air Force officials defined three types of surge, which increase 
operations in response to a situation or event. For example, local 
surge increases flying time; regional surge mobilizes and deploys 
military forces; and strategic surge includes large-scale return of 
forces from overseas or large scale mobility operations. 

[75] Air Force BRAC installations fell into eight major commands: (1) 
Air Mobility Command, (2) Air Combat Command, (3) Air Force Space 
Command, (4) Air Force Materiel Command, (5) Air Force Special 
Operations Command, (6) Air Education and Training Command, (7) Pacific 
Air Force, and (8) Air Force Reserve Command. The Air National Guard 
was included in the analysis, although it is not considered a major 
command. 

[76] The mission compatibility indexes list each of the 154 
installations considered in the Air Force BRAC process, with its 
respective scores for the overall mission; current and future mission; 
condition of infrastructure; contingency, mobilization, and future 
forces; and cost of operations and manpower. 

[77] The Air Force Audit Agency performed audits on the following areas 
for BRAC 2005: Air Force Internal Control Plan, Installations 
Inventory, Installation Capacity Analysis Questionnaire, Base 
Realignment and Closure Data Collection System, Air Force Data 
Collection, Joint Cross-Service Group Data Collection, Joint Action 
Scenario Team Data Collection, Installation Visualization Tool Data 
Reliability, NOISEMAP Reliability, Air Force Analysis, Cost of Base 
Realignment Actions, Cueing and Analysis Tools, and BRAC Facility 
Analysis Capability. 

[78] According to the Air Force's BRAC report, it recommends 72 BRAC 
closures and realignments. However, it presented only 42 recommendation 
narratives because various realignment actions were combined. 

[79] The Air Force scenario teams in BRAC 2005 were the Combat Air 
Forces, Mobility Air Forces, Space, and Integration. 

[80] For example, Bangor Air Guard Station, Maine, is a receiver in the 
realignment of Birmingham Air Guard Station, Alabama, although it has a 
lower military value score for the tanker Mission Compatibility Index 
than Birmingham Air Guard Station. However, the Bangor Air Guard 
Station is used by the Air Force as a host base for the Northeast 
Tanker Task Force in order to support transatlantic air operations. 

[81] According to the Air Force's BRAC report, it recommends 72 BRAC 
closures and realignments. However, the Air Force presented only 42 
recommendation narratives because various realignment actions were 
combined. 

[82] The three recommendations that do not affect the reserve component 
include the closure of Onizuka Air Force Station, California; the 
realignment of Langley Air Force Base, Virginia; and the Air Force 
logistics support centers recommendation. 

[83] Joint cross-service groups and other service recommendations do, 
however, allow for increased jointness with the Air Force. For example, 
Eglin Air Force Base, Florida, will host Joint Strike Fighter pilot 
training and will also host the Army's Seventh Special Forces Group in 
conjunction with Education and Training Joint-Cross Service Group and 
Army recommendations, creating substantial joint training 
opportunities. Additionally, the Air Force enables Army closures and 
realignments by turning over property ownership of Pope Air Force Base 
to the Army, though an active/Air Reserve unit will permanently be 
based at Fort Bragg, North Carolina, to assist with the aerial port and 
tactical airlift capabilities needed by the Army's Airborne Corps. 

[84] Based on senior military judgment reflected in the Expeditionary 
Air Force Principles White Paper, fighter squadrons will be optimally 
sized to 24 aircraft per squadron, and 18 is the acceptable size per 
squadron for stand-alone reserve installations. Sixteen is the optimum 
size for C-130s (airlift aircraft) and KC-135s (tanker refueling 
aircraft), and 12 is the acceptable size for stand-alone reserve 
installations. 

[85] GAO, Air Force Aircraft: Consolidating Fighter Squadrons Could 
Reduce Costs, GAO/NSIAD-96-82 (Washington, D.C.: May 6, 1996). 

[86] The three recommendations that do not affect the reserve component 
include the closure of Onizuka Air Force Station, California; the 
realignment of Langley Air Force Base, Virginia; and the Air Force 
logistics support centers recommendation. 

[87] The Department of the Air Force Analysis and Recommendations BRAC 
2005, volume 5, part 1 of 2, page iii, lists 31 Air National Guard and 
4 Air Reserve installations that were realigned. The Willow Grove Air 
Reserve Station realignment action is located in the Department of the 
Navy section of DOD's BRAC report. 

[88] For example, the Pope Air Force Base recommendation, which 
primarily affects active duty units, also includes the closure of 
Pittsburgh Air Reserve Station, realignment of Yeager Air Guard Station 
and Little Rock Air Force Base, thus affecting active, Air Reserve, and 
Air National Guard personnel. 

[89] The Air Force presented further information regarding the impact 
of BRAC recommendations on manpower including full time and drill 
personnel in the Air Force reserve component document titled, State-by-
State Installation View, May 13, 2005. 

[90] The U.S. Coast Guard has eight helicopters at Otis Air National 
Guard Base, Massachusetts. 

[91] The Pope Air Force Base recommendation includes the closure of 
Pittsburgh Air Reserve Station and the realignment of Yeager Air Guard 
Station and Little Rock Air Force Base. 

[92] The Grand Forks Air Force Base recommendation also includes the 
realignment of McConnell Air Force Base. 

[93] The Infrastructure Executive Council examined the strategic 
presence of Grand Forks Air Force Base in the central United States 
after all the service and Joint Cross-Service Group candidate 
recommendations were evaluated as an aggregate. 

[94] GAO, Military Bases, Analysis of DOD's 1995 Process and 
Recommendations for Closure and Realignment, GAO/NSIAD-95-133 
(Washington, D.C.: Apr. 14, 1995). 

[95] At the Office of the Secretary of Defense, the ISG and the IEC 
provided overall coordination and direction to the DOD-wide process. 

[96] Since there was no standard definition, three of the subgroups 
identified surge requirements on a judgmental basis as a percentage of 
capacity raging from 10 to 25 percent. The professional development 
education subgroup did not identify a surge requirement. 

[97] Some of the transformation options included privatizing graduate-
level education, establishing centers of excellence for joint or 
interservice education and training by combining or co-locating like 
schools, establishing joint officer and enlisted specialized skill 
training, and consolidating or co-locating at a single installation all 
services' primary phase of pilot training that uses the same aircraft. 

[98] At OSD, the Infrastructure Steering Group (ISG) and the 
Infrastructure Executive Council (IEC) provided overall coordination 
and direction to the DOD-wide process. 

[99] These are installations having shared boundaries or that are 
located in proximity to each other. 

[100] The group used 200 gross square feet as the standard factor as a 
compromise to account for the different standards used by each of the 
military services and defense agencies. 

[101] Department of Defense, Office of Inspector General Audit Report, 
Headquarters and Support Activities Joint Cross-Service Group Data 
Integrity and Internal Control Processes for Base Realignment and 
Closure 2005, Report No. D2003-D000CG-0135.000 (Arlington, Va.: 
forthcoming). 

[102] The recommendations are to co-locate defense and military 
adjudication activities at Fort Meade, Maryland, and to consolidate 
Defense Commissary Agency offices at Fort Lee, Virginia. 

[103] A DOD Inspector General representative told us that the group 
rounded all personnel reductions to the next highest number, rather 
than the normal practice of rounding up only when the calculated number 
was .5 or higher. 

[104] The group's recommendations transferred to the military 
departments allowed the departments to recommend closure of Fort 
Monroe, Virginia, Fort McPherson, Georgia, Naval Supply Activity New 
Orleans, Louisiana, Marine Corps Support Center Kansas City, Missouri, 
and Brooks City-Base, Texas. 

[105] Approximately $270 million, of the projected net annual recurring 
savings are from the elimination of military personnel and 
approximately $267 million from the elimination of civilian employees. 

[106] The National Capital Region includes Washington, D.C; the 
Maryland counties of Montgomery and Prince George's; and the Virginia 
counties of Fairfax, Loudoun, and Prince William and the City of 
Alexandria, Virginia. 

[107] Unified Facilities Criteria: DOD Minimum Antiterrorism Standards 
for Buildings (UFC 4-010-01, 8 Oct. 2003). 

[108] The other joint cross-service groups are also proposing to move 
about 9,600 personnel to Fort Belvoir for a total of over 20,300 
personnel. 

[109] The functions include such activities as real property management 
and maintenance, utilities, housing, emergency services, environmental 
services, base security, reserve component support, resource 
management, procurement, personal property management, transportation, 
equipment maintenance, retail supply, base communications, audio/visual 
services, personnel and professional support, personnel services, food 
services, laundry services, education services, personal and family 
services, recreation, military exchange operations, airfield 
operations, garrison operations, internal review, inspector general, 
and strategic planning. 

[110] GAO, Defense Infrastructure: Issues Need to Be Addressed in 
Managing and Funding Base Operations and Facilities Support, GAO-05-556 
(Washington, D.C.: June 15, 2005). 

[111] In late 2004, a Senior Joint Basing Group was created by DOD to 
address installation management issues at joint bases. 

[112] Scott Air Force Base is the current home of the U.S. 
Transportation Command headquarters and the Air Force Air Mobility 
Command, one of the combatant command's subordinate component commands. 

[113] At the Office of the Secretary of Defense, the ISG and the IEC 
provided overall coordination and direction to the DOD-wide process. 

[114] A commodity is a generic grouping of the types of depot and 
maintenance work associated with end items, weapons systems, or major 
processes, such as engines, combat vehicles, and calibration. 

[115] The term interservicing is used here to refer to the 
consolidation of common workloads of more than one service under a 
single military service. 

[116] GAO, Army Depot Maintenance: Privatization without Further 
Downsizing Increases Costly Excess Capacity, GAO/NSIAD-96-201 
(Washington, D.C: Sept. 18, 1996). 

[117] The shore based aviation consolidated allowance list inventory is 
a consolidated list of components, repair parts, and consumable items 
and depot and field level repairable items required to support planned 
operational and maintenance missions at designated naval and Marine 
Corps air stations. 

[118] The Navy working capital fund is a revolving fund that relies on 
sales revenue rather than direct appropriations to finance its 
operations. Activities under the fund are supposed to generate 
sufficient revenues to recover expenses incurred in their operations 
and are expected to operate on a break-even basis over time. 

[119] Under 10 U.S.C. 2466, not more than 50 percent of annual depot 
maintenance funding provided to the military departments and defense 
agencies can be used for work accomplished by private-sector 
contractors. Section 2466 also requires annual reporting to the 
congress on the distribution of depot maintenance funding between the 
public and private sectors. 

[120] GAO, Depot Maintenance: Key Financial Issues for Consolidations 
at Pearl Harbor and Elsewhere Are Still Unresolved, GAO-01-19 
(Washington, D.C: Jan. 22, 2001). 

[121] Pueblo Chemical Depot was removed from the BRAC closure list two 
weeks before the recommendations were released. During the BRAC 
process, we expressed our concerns that Pueblo would not be able to 
successfully demilitarize its stockpiles within the statutory BRAC 
timeframe because a plant has yet to be built. 

[122] GAO, Chemical Weapons: Destruction Schedule Delays and Cost 
Growth Continue to Challenge Program Management, GAO-04-634T 
(Washington, D.C.: Apr. 1, 2004), GAO, Nonproliferation: Delays in 
Implementing the Chemical Weapons Convention Raise Concerns About 
Proliferation, GAO-04-361 (Washington, D.C.: Mar. 31, 2004), and GAO, 
Chemical Weapons: Sustained Leadership, Along with Key Strategic 
Management Tools, Is Needed to Guide DOD's Destruction Program, GAO-03-
1031 (Washington, D.C.: Sept. 5, 2003). 

[123] GAO, Military Bases: Cost to Maintain Inactive Ammunition Plants 
and Closed Bases Could be Reduced, GAO/NSIAD-97-56 (Washington, D.C.: 
Feb. 20, 1997). 

[124] At the Office of the Secretary of Defense, the Infrastructure 
Steering Group (ISG) and the Infrastructure Executive Council (IEC) 
provided overall coordination and direction to the DOD-wide process. 

[125] Initially, the group developed a space allowance of 100 square 
foot for detailees and contractors. However, the group subsequently 
found out that detailees and contractors consisted of all levels of 
personnel, including high ranking liaisons, managers, and analysts. As 
a result, the group raised the space allowance 150 square foot per 
person, which they believe more accurately reflects the intelligence 
community average for government, military and civilian personnel. 

[126] The headquarters group has several recommendations that propose 
to move activities to Fort Belvoir. 

[127] At OSD, the Infrastructure Steering Group (ISG) and the IEC 
provided overall coordination and direction to the DOD-wide process. 

[128] Medical care under TRICARE is provided by DOD personnel in 
military treatment facilities or through civilian providers in civilian 
facilities. During the 1990s, DOD restructured its health care system 
into TRICARE to improve beneficiaries' access to health care while 
maintaining quality and controlling costs. 

[129] The DOD health care system included about 163,000 medical 
personnel worldwide in fiscal year 2004, some of whom are active duty 
military personnel assigned to deployable units that may rotate back to 
military treatment facilities. 

[130] Catchment areas are geographic areas determined by the Assistant 
Secretary of Defense for Health Affairs that are defined by five-digit 
zip codes, usually within an approximate 40-mile radius of military 
treatment facilities with inpatient care. 

[131] The National Defense Authorization Act of Fiscal Year 2004 (P.L. 
108-136, Section 726 [Nov. 24, 2003]) required the Secretary of Defense 
to consult with the working group in developing recommendations in the 
2005 BRAC round. The working group is expected to provide a plan to the 
Secretary of Defense in order to provide health care services to 
persons who are entitled to and are receiving health care and whose 
accessibility to it will be affected by 2005 BRAC actions. 

[132] The medical group used a DOD-approved optimization model 
developed by the Navy. Depending on the assumptions used in the model 
and level of capacity reduction, the model provided a set of potential 
closure or realignment alternatives for further consideration by 
decision makers. 

[133] Multiservice markets exist where two or more service military 
treatment facilities are co-located geographically with shared 
beneficiary populations. The medical group concluded that a substantial 
portion of total inpatient excess capacity was in multiservice markets. 

[134] One of the medical group's recommendations includes 
disestablishing the inpatient mission at 9 military treatment 
facilities. A VA hospital was located near inpatient facilities at 
Andrews Air Force Base, Maryland; Fort Eustis, Virginia; Fort Knox, 
Kentucky; Keesler Air Force Base, Mississippi; MacDill Air Force Base, 
Florida; Naval Station Great Lakes, Illinois; and Scott Air Force Base, 
Illinois. 

[135] The medical group developed this candidate recommendation with 
the knowledge of a specific provision of federal law (10 U.S.C. 2112a) 
that could preclude closure of the university. 

[136] GAO, Budget Issues: Budgetary Implications of Selected GAO Work 
for Fiscal Year 2001, GAO/OCG-00-8 (Washington, D.C.: Mar. 31, 2000); 
GAO, Budget Issues: Budgetary Implications of Selected GAO Work for 
Fiscal Year 2000, GAO/OCG-99-26 (Washington, D.C.: Apr. 16, 1999); and 
GAO, Military Physicians: DOD's Medical School and Scholarship Program, 
GAO/HEHS-95-244 (Washington, D.C.: Sept. 29, 1995). 

[137] Performance-based logistics is defined as the purchase of weapon 
system sustainment as part of an affordable integrated weapon system 
package based on output measures, such as weapon system availability, 
rather than input measures, such as parts and technical services. 

[138] At OSD, the ISG and the IEC provided overall coordination and 
direction to the DOD-wide process. 

[139] DOD maintains supply within a two-tiered system typically 
referred to as the wholesale and retail levels. Wholesale generally 
includes activities that procure, hold, and manage materiel not 
specific to individual operating units, and is also referred to as 
"above installation activities." Retail refers to activities that 
support organizational level needs for supplies and materiel and is 
also referred to as "installation and below activities."

[140] Limited retail-level data were collected with the cooperation of 
the Industrial Joint Cross-Service Group to support one recommendation 
that contained some service retail supply consolidations with DLA 
wholesale supply activities. 

[141] The group defined excess capacity as the difference between 
current capacity and current usage. Under increased surge conditions, 
excess capacity will be reduced. 

[142] Depot level reparables are supply items that are designed to be 
repaired at the depot level. 

[143] The Defense Supply Center Columbus Ohio, manages the maritime and 
land supply chain. The Defense Supply Center Richmond Virginia, manages 
the aviation supply chain, and the Defense Supply Center Philadelphia 
Pennsylvania, manages the troop support supply chain. 

[144] Consumable items are either not repairable or not economically 
repairable. 

[145] Performance-based agreements are the negotiated agreements 
between the major stakeholders that formally document the performance 
and support expectations and resources to achieve the desired outcome. 

[146] Follower organizations exist only because there is a larger 
organization that they serve at their locations. 

[147] A-76 is competitive sourcing where the federal government 
determines whether functions described as "commercial in nature" are 
best provided by the private sector, by government personnel, or by 
another agency through a fee-for-service agreement. 

[148] These additional closures are Fort Monmouth, New Jersey, which is 
included in the Army section of DOD's report; Naval Support Activity 
Corona, California, which is included in the Navy section; and Brooks 
City-Base, Texas, which is included in the Medical Joint Cross-Service 
Group section. 

[149] At OSD, the Infrastructure Steering Group (ISG) and the 
Infrastructure Executive Council (IEC) provided overall coordination 
and direction to the DOD-wide process. 

[150] Test ranges were in the technical group's domain; open-air ranges 
were analyzed by the Education and Training Joint Cross-Service Group 
with input from the technical group. 

[151] The 13 technical capability areas are based on the Defense 
Technology Area Plan 2003, which lists 12 areas; however the technical 
group separated ground vehicles and sea vehicles into two technical 
capability areas for subgroup review and analysis. 

[152] Multifunctional refers to combining activities across the three 
functions of research, development and acquisition, and test and 
evaluation. Multidisciplinary refers to combining activities across 1 
or more of the 13 technical capability areas. 

[153] The group defined a technical facility category as a collection 
of people and physical infrastructure that performs a technical 
function (or functions) in a specific technical capability area at a 
specific location. 

[154] The group also provided a recommendation to relocate Naval 
Support Activity Corona to March Air Reserve Base. According to 
technical group officials, when the closure of Naval Support Activity 
Corona is included in the data, both their original recommendation and 
alternative had shorter payback periods and higher 20-year net present 
value savings than the Navy's final recommendation. 

[155] The group found that the Navy's 1995 BRAC recommendations 
projected that the Navy would eliminate 4,000 technical positions. 
Comparable information was not available for the Air Force and Army; 
however, the group assumed that the Air Force and Army eliminated the 
same number of personnel, for an approximate 12 percent reduction of 
the technical workforce through BRAC 1995. The group rounded this up to 
15 percent for a standard assumption for military and civilian 
personnel reductions. Based on our analysis of the 1995 BRAC 
recommendations, it is unlikely that the Air Force and Army reduced 
their technical workforces by 4,000 positions because neither had BRAC 
recommendations that closed significant technical facilities. 

[156] We identified an additional $12.8 million savings for eliminating 
contractors for the recommendation to co-locate extramural research 
program managers that was included as a one-time savings but should 
have been an annual recurring savings. The total annual recurring 
savings for eliminating contractors would increase to $66.7 million if 
this error is corrected. 

[157] The recommendations are the co-location of extramural research 
program managers, consolidation of ground vehicle development and 
acquisition, and co-location of the Defense research service-led 
laboratories. 

[158] The eight locations are the Air Force Research Laboratory, Mesa 
City, Arizona; United States Marine Corps Direct Reporting Program 
Manager Advanced Amphibious Assault facilities, Virginia; Office of 
Naval Research, Virginia; Air Force Office of Scientific Research 
facility, Virginia; Army Research Office, North Carolina; Army Research 
Office, Virginia; Defense Advanced Research Project Agency facility, 
Virginia; and Defense Threat Reduction Agency, Fort Belvoir, Virginia, 
which is currently in leased space in Virginia. 

[159] The projected savings were determined using the Headquarters and 
Support Activities Joint Cross-Service Group's methodology of a savings 
of $37.29 per square foot of space being vacated within the Washington, 
D.C. area. The group assumed that 160 square feet would be vacated for 
each person moved or eliminated. 

[160] The technical group did not take a one-time savings for the 
Defense Threat Reduction Agency because, according to an agency 
official, the agency is scheduled to move to Fort Belvoir in January 
2006. 

[161] See app. VII for further discussion of antiterrorism and force 
protection standards. 

[162] As previously mentioned, the technical group originally provided 
other options for the Navy's recommendation to close Naval Support 
Activity Corona, which were disapproved by the ISG. 

[163] When the impact of other joint cross-service group and service 
recommendations is included, this increases to 683 direct jobs lost and 
an 11.6 percent reduction in direct and indirect jobs in Martin County. 

[164] A Navy official said that most Navy activities asked to exclude 
large numbers of personnel from consideration in recommendations and 
the technical group was consistent in disregarding these exclusions. 

[165] Federally funded research and development centers are nonprofit 
entities sponsored and funded by the government that typically assist 
government agencies with scientific research and analysis, systems 
development, and systems acquisition. The Aerospace Corporation is the 
federally funded research and development center that works with the 
Space and Missile Systems Center at Los Angeles Air Force Base. 

[166] The Air Force considered three options for closing Los Angeles 
Air Force Base. One option used a city-base construct, which had a 2-
year payback and a $99.0 million 20-year net present value savings. 
Another allowed for office space for the contractors with the federally 
funded research and development center and had a 9-year payback and a 
$228.3 million 20-year net present value savings. 

[167] P.L. 101-510, section 2913 (c)(1) requires DOD to consider the 
extent and timing of potential costs and savings, including the number 
of years until savings exceed costs, in its BRAC selection process. 

[168] BRAC legislation provides for a 6-year implementation period 
following the approval of recommended BRAC actions. Thus the final year 
for implementation of a closure or realignment action for the 2005 BRAC 
round is 2011. P.L. 101-510, section 2904 (a)(5). 

[169] For BRAC 2005, costs and savings are in fiscal year 2005 constant 
dollars. 

[170] In the context of BRAC, net present value is taking into account 
the time value of money in calculating the value of future cost and 
savings. For fiscal year 2005, DOD used a 2.8 percent discount rate to 
calculate net present value. 

[171] GAO, Military Base Closures: Better Planning Needed for Future 
Reserve Enclaves, GAO-03-723 (Washington, D.C.: June 27, 2003). An 
enclave is a section of a military installation that remains intact 
after the installation is closed or realigned, and that will continue 
with its current role and functions, subject to specific modifications. 

[172] GAO, Military Bases: Lessons Learned from Prior Base Closure 
Rounds, GAO/NSIAD-97-151 (Washington, D.C.: July 25, 1997). 

[173] U.S. Army Audit Agency, Cost of Base Realignment Actions (COBRA) 
Model, Audit Report A-2004-0544-IMT (Alexandria, Va.: Sept. 30, 2004). 

[174] This policy is based on the fact DOD is obligated to restore 
contaminated sites on military bases regardless of whether they are 
closed. We agree with DOD's position that such costs are a liability to 
DOD regardless of its base closure recommendations. While such costs 
are not included in COBRA, they are included in developing BRAC 
implementation budgets. 

[175] GAO, Military Base Closures: Updated Status of Prior Base 
Realignments and Closures, GAO-05-138 (Washington, D.C.: Jan. 13, 
2005). 

[176] GAO, Military Base Closures: Updated Status of Prior Base 
Realignments and Closures, GAO-05-138 (Washington, D.C.: Jan. 13, 
2005); GAO, Military Base Closures: Progress in Completing Actions from 
Prior Realignments and Closures, GAO-02-433 (Washington, D.C.: Apr. 5, 
2002); and GAO, Military Bases: Status of Prior Base Realignment and 
Closures Rounds, GAO/NSAID-99-36 (Washington, D.C.: Dec. 11, 1998). 

[177] GAO, Military Base Closures: Updated Status of Prior Base 
Realignments and Closures, GAO-05-138 (Washington, D.C.: Jan. 13, 
2005). 

[178] An independent review panel of four members, three Ph.D. 
economists and one policy analyst, who were all experienced in 
conducting local economic impact studies and who were not otherwise 
associated with the BRAC 2005 process was formed to review the 
methodology and to determine if it conformed to accepted economic 
practices. 

[179] Based on the primary counties in which bases were located, the 
Federal Information Processing Standards (FIPS) codes were determined. 
A mapping of the county FIPS codes to Statistical Areas as determined 
by OMB was done to establish the economic area. 

[180] Metropolitan Statistical Area (MSA) is a core based statistical 
area associated with at least one urbanized area that has a population 
of at least 50,000. A core based statistical area is a statistical 
geographic entity consisting of the county or counties associated with 
at least one core (urbanized area or urban cluster) of at least 10,000 
population, plus adjacent counties having a high degree of social and 
economic integration with the core as measured through commuting ties 
with the counties containing the core. The MSA comprises the central 
county or counties containing the core, plus adjacent outlaying 
counties having a high degree of social and economic integration with 
the central country as measured through commuting. While a MSA has at 
least 50,000 people, a Micropolitan Statistical Area has at least one 
urban cluster that has a population of at least 10,000 but less than 
50,000. The Micropolitan Statistical Area comprises the central county 
or counties containing the core, plus adjacent outlaying counties 
having a high degree of social and economic integration with the 
central county as measured through commuting. 

[181] A Metropolitan Division is used to refer to a county or group of 
counties within a MSA that has a population core of at least 2.5 
million people. 

[182] Contractor mission support employees perform one or more of the 
military missions on the base, and whose work tasks are virtually 
identical to government civil servants or military personnel. Examples 
include intelligence analysts; technicians; aircraft, ship, vehicle, or 
weapon system maintenance staff; and information technology 
specialists. 

[183] MIG are the developers of the IMPLAN economic impact modeling 
system. The firm provides tools, data, and support to perform in-depth 
examinations of state, county, or multi-county regions. Over 1,000 
public and private institutions use its tools. MIG does not have data 
for Puerto Rico or Guam. Based on recommendations of the Independent 
Review Panel of the BRAC economic impact methodology, MIG experts, and 
the Chief Economist of the Guam Department of Labor, multipliers for 
Key West-Marathon Florida Micropolitan Statistical Area (Monroe County, 
Florida) were assigned to the San Juan-Caguas-Guaynabo, Puerto Rico 
Metropolitan Statistical Area. Multipliers for the Honolulu, Hawaii MSA 
were assigned to the Guam economic area. 

[184] MOSes are specific military occupations performed by military 
personnel. Examples of some of the many MOSes within the military 
include administrative clerk, rifleman, logistics specialist, 
machinist, and ammunition technician. To aid in the crosswalk from 
MOSes to industry sectors (represented by codes from the North American 
Industrial Classification (NAICS)), the MOSes were mapped to the 
Standard Occupational Classification, which were in turned mapped into 
the NAICS codes. 

[185] Most of these new economic areas appeared to have populations 
smaller than the average of the existing populations. Generally, it is 
expected that the larger the population for an area, the larger the 
multipliers, and vice-versa. An area with a larger population would be 
expected to have more of its expenditures remaining in the area and 
have fewer of its expenditures leak out to other areas. As a result, 
the multipliers of areas with larger populations would be expected to 
be larger than average and vice-versa. Thus, these economic areas would 
be expected to have multipliers smaller than the average. Using the 
average multipliers would tend to overestimate the indirect/induced job 
impact on these economic areas. 

[186] The methodology for the 1995 BRAC process, which was similar to 
the methodology used for the 2005 BRAC process, was also reviewed by an 
independent panel comprised of 6 members. 

[187] Some of the recommendations had multiple actions that affected 
more than one economic area. 

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