This is the accessible text file for GAO report number GAO-09-217 
entitled 'Military Base Realignments and Closures: DOD Faces Challenges 
in Implementing Recommendations on Time and Is Not Consistently 
Updating Savings Estimates' which was released on February 2, 2009. 

This text file was formatted by the U.S. Government Accountability 
Office (GAO) to be accessible to users with visual impairments, as part 
of a longer term project to improve GAO products' accessibility. Every 
attempt has been made to maintain the structural and data integrity of 
the original printed product. Accessibility features, such as text 
descriptions of tables, consecutively numbered footnotes placed at the 
end of the file, and the text of agency comment letters, are provided 
but may not exactly duplicate the presentation or format of the printed 
version. The portable document format (PDF) file is an exact electronic 
replica of the printed version. We welcome your feedback. Please E-mail 
your comments regarding the contents or accessibility features of this 
document to Webmaster@gao.gov. 

This is a work of the U.S. government and is not subject to copyright 
protection in the United States. It may be reproduced and distributed 
in its entirety without further permission from GAO. Because this work 
may contain copyrighted images or other material, permission from the 
copyright holder may be necessary if you wish to reproduce this 
material separately. 

Report to Congressional Committees: 

United States Government Accountability Office: 

GAO: 

January 2009: 

Military Base Realignments And Closures: 

DOD Faces Challenges in Implementing Recommendations on Time and Is Not 
Consistently Updating Savings Estimates: 

Military Base Realignments and Closures: 

GAO-09-217: 

GAO Highlights: 

Highlights of GAO-09-217, a report to congressional committees. 

Why GAO Did This Study: 

The 2005 Base Realignment and Closure (BRAC) round is the biggest, most 
complex, and costliest BRAC round ever. In addition to base closures, 
many recommendations involve realignments, such as returning forces to 
the United States from bases overseas and creating joint bases. 
However, anticipated savings remained an important consideration in 
justifying the need for the 2005 BRAC round. 

The House report on the National Defense Authorization Act for Fiscal 
Year 2008 directed GAO to monitor BRAC implementation. Therefore, GAO 
assessed (1) challenges that might affect timely completion of 
recommendations, (2) any changes in DOD’s reported cost and savings 
estimates since fiscal year 2008, and (3) the potential for estimates 
to continue to change. To address these objectives, GAO reviewed 
documentation and interviewed officials in the Office of the Secretary 
of Defense (OSD), the services’ BRAC offices, and the Army Corps of 
Engineers; visited installations implementing some of the more costly 
realignments or closures; and analyzed BRAC budget data for fiscal 
years 2008 and 2009. 

What GAO Found: 

DOD has made progress in implementing the BRAC 2005 round but faces 
challenges in its ability to meet the September 15, 2011, statutory 
completion deadline. DOD expects almost half of the 800 defense 
locations implementing BRAC recommendations to complete their actions 
in 2011; however, about 230 of these almost 400 locations anticipate 
completion within the last 2 weeks of the deadline. Further, some of 
these locations involve some of the most costly and complex BRAC 
recommendations, which have already incurred some delays and thus have 
little leeway to meet the 2011 completion date if any further delays 
occur. Also, DOD must synchronize relocating about 123,000 personnel 
with an estimated $23 billion in facilities that are still being 
constructed or renovated, but some delays have left little time in 
DOD’s plans to relocate these personnel by the deadline. Finally, 
delays in interdependent recommendations could have a cascading effect 
on other recommendations being completed on time. OSD recently issued 
guidance requiring the services and defense agencies to provide status 
briefings to improve oversight of issues affecting timely 
implementation of BRAC recommendations. However, this guidance did not 
establish a regular briefing schedule or require the services to 
provide information about possible mitigation measures for any BRAC 
recommendations at risk of not meeting the statutory deadline. 

DOD’s fiscal year 2009 BRAC budget submission shows that DOD plans to 
spend more to implement recommendations and save slightly less compared 
to the 2008 BRAC budget. DOD’s 2009 estimate of one-time costs to 
implement this BRAC round increased by $1.2 billion to about $32.4 
billion. Net annual recurring savings estimates decreased by almost $13 
million to about $4 billion. Also, GAO’s calculations of net present 
value, which includes both expected cost and savings over a 20-year 
period ending in 2025 and takes into account the time value of money, 
show that implementing the 2005 BRAC recommendations is expected to 
save $13.7 billion. This compares to an estimated $15 billion in net 
present value savings based on last year’s BRAC budget and the BRAC 
Commission’s reported estimate of about $36 billion. 

Although DOD is about 3½ years into the 6-year implementation period, 
the potential remains for BRAC cost estimates to continue to increase, 
but the potential for changes in savings estimates is unclear. Greater 
than expected inflation and increased market demands for construction 
materials could cause estimated construction costs to increase, 
although the extent of this increase is uncertain given today’s 
economic market conditions. However, the potential for changes in 
savings estimates is unclear because BRAC headquarters officials at 
both the Army and the Air Force told us they do not plan to update 
their savings estimates regardless of factors that may cause those 
estimates to change, and OSD is not enforcing its own regulation 
requiring them to do so. Hence, congressional and defense decision 
makers could be left with an unrealistic sense of the savings this 
complex and costly BRAC round may actually produce, an issue that could 
be important in considering whether another round of BRAC may be 
warranted. 

What GAO Recommends: 

GAO recommends that OSD modify its recently issued guidance on BRAC 
implementation status and require the services to update BRAC savings 
estimates. DOD concurred with GAO’s recommendations. 

To view the full product, including the scope and methodology, click on 
[hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO-09-217]. For more 
information, contact Brian J. Lepore at (202) 512-4523 or 
leporeb@gao.gov. 

[End of section] 

Contents: 

Letter: 

Results in Brief: 

Background: 

Challenges Increase the Risk That Some BRAC Recommendations Might Not 
Be Completed by the Statutory Deadline: 

BRAC Implementation Cost Estimates Are Higher and Savings Estimates Are 
Lower Compared to Previous Fiscal Year: 

Cost Estimates Could Continue to Rise, but the Potential for Savings 
Estimates to Change Is Unclear: 

Conclusions: 

Recommendations for Executive Action: 

Agency Comments and Our Evaluation: 

Appendix I: Scope and Methodology: 

Appendix II: BRAC Recommendations DOD Expects to Cost the Most: 

Appendix III: BRAC Recommendations DOD Expects to Save the Most 
Annually: 

Appendix IV: BRAC Recommendations DOD Expects to Save the Most Over a 
20- year Period: 

Appendix V: Comments from the Department of Defense: 

Appendix VI: GAO Contact and Staff Acknowledgments: 

Related GAO Products: 

Tables: 

Table 1: BRAC Recommendations with the Largest Increases in One-Time 
Estimated Costs from Fiscal Year 2008 to Fiscal Year 2009: 

Table 2: Comparison of BRAC Cost Categories from Fiscal Year 2008 to 
Fiscal Year 2009: 

Table 3: BRAC Recommendations DOD Expects to Cost the Most to Implement 
(Fiscal Years 2006 through 2011): 

Table 4: BRAC Recommendations DOD Expects to Save the Most Annually 
After Implementation (Projected for Fiscal Year 2012): 

Table 5: BRAC Recommendations DOD Expects to Save the Most Over a 20- 
year Period (Fiscal Years 2006 through 2025): 

Figure: 

Figure 1: Small Percentage of BRAC Recommendations Generates Majority 
of Estimated Savings: 

Abbreviations: 

BRAC: base realignment and closure: 

DOD: Department of Defense: 

OSD: Office of the Secretary of Defense: 

[End of section] 

United States Government Accountability Office: 

Washington, DC 20548: 

January 30, 2009: 

Congressional Committees: 

The 2005 Base Realignment and Closure (BRAC) round is the fifth such 
round undertaken by DOD since 1988 and, by our assessment, is the 
biggest, most complex, and costliest BRAC round ever. With this BRAC 
round, the Department of Defense (DOD) plans to execute hundreds of 
BRAC actions affecting over 800 defense locations, relocate over 
123,000 personnel, and spend over $32 billion--an unprecedented amount, 
given that DOD has spent almost $25 billion[Footnote 1] to implement 
the four previous BRAC rounds combined when all relevant BRAC actions 
have been completed. Unlike prior BRAC rounds, DOD is implementing the 
BRAC 2005 round during a time of conflict and significant additional 
defense appropriations through supplemental budgets to support 
contingency operations. Compounding this challenge, DOD is also 
implementing or planning to implement other extensive worldwide 
transformation initiatives such as the permanent relocation of about 
70,000 military personnel[Footnote 2] to the United States from Europe 
and Korea; transformation of the Army's force structure from an 
organization based on divisions to more rapidly deployable, combat 
brigade-based units; an increase in the active-duty end strength of the 
Army and the Marine Corps by 92,000 members;[Footnote 3] and the 
potential redeployment of combat forces from Iraq to the United States, 
all of which will place additional demands on DOD's domestic facility 
infrastructure. 

The Office of the Secretary of Defense (OSD) at the outset of BRAC 2005 
indicated its intent to reshape DOD's installations and realign DOD 
forces to meet defense needs for the next 20 years. Moreover, both DOD 
and the BRAC Commission[Footnote 4] reported that their primary 
consideration in making recommendations for the BRAC 2005 round was 
military value.[Footnote 5] As such, many of the BRAC 2005 
recommendations involve complex realignments, such as designating where 
military forces returning to the United States from overseas bases 
would be located; establishing joint military medical centers; creating 
joint bases; and reconfiguring the defense supply, storage, and 
distribution network. DOD is required to implement all BRAC 2005 
recommendations by September 15, 2011. 

However, anticipated savings resulting from implementing 
recommendations remained an important consideration in justifying the 
need for the 2005 BRAC round. In 2001 testimony before Congress, the 
Secretary of Defense stated that another BRAC round would generate 
recurring savings the department could use for other defense programs, 
and that the BRAC Commission expected that the round would save about 
$36 billion over a 20-year period ending in 2025.[Footnote 6] 
Nonetheless, to realize savings from BRAC, DOD must first invest 
billions of dollars in facility construction, renovation, and other up- 
front expenses to implement the BRAC recommendations to produce the 
projected savings that DOD could then redirect to other priorities. 

Because of concerns about the progress DOD is making in implementing 
the BRAC 2005 recommendations, the House Armed Services Committee 
report accompanying the National Defense Authorization Act for Fiscal 
Year 2008[Footnote 7] directed the Comptroller General to monitor the 
implementation of recommendations for the 2005 round of closures and 
realignments of military installations made pursuant to section 2914 of 
the Defense Base Closure and Realignment Act of 1990.[Footnote 8] We 
prepared this report to (1) assess the challenges DOD faces that might 
affect the implementation of the BRAC recommendations by the statutory 
completion deadline in 2011, (2) analyze how DOD's reported cost and 
savings estimates have changed in the fiscal year 2009 BRAC budget 
request compared to the fiscal year 2008 budget request, and (3) 
evaluate the potential for BRAC cost and savings estimates to continue 
to change as DOD proceeds with BRAC implementation. 

To address these objectives, we reviewed relevant documentation 
including business plans, DOD presentations on BRAC implementation 
status, and prior GAO reports, and interviewed officials in the Office 
of the Deputy Under Secretary of Defense (Installations and 
Environment) responsible for overseeing BRAC implementation and 
associated BRAC implementation offices in the Army, the Navy, and the 
Air Force. To assess the challenges DOD faces that might affect the 
implementation of the BRAC recommendations by the statutory completion 
deadline in 2011, we focused our work on recommendations that have 
significant actions such as construction and movement of personnel 
scheduled to occur near the statutory deadline. To analyze how DOD's 
reported cost and savings estimates have changed in the fiscal year 
2009 BRAC budget submission compared to the fiscal year 2008 budget 
submission, we obtained budget data for both fiscal years and compared 
dollar amount differences for cost and savings estimates for each BRAC 
recommendation. To calculate the 20-year net savings estimates, we used 
DOD's fiscal year 2009 BRAC budget data using the same methodology DOD 
used to report its estimate to the BRAC Commission. Finally, to 
evaluate the potential for BRAC cost and savings estimates to continue 
to change as the department proceeds with BRAC implementation, we 
interviewed officials from the Office of the Deputy Under Secretary of 
Defense (Installations and Environment) responsible for overseeing BRAC 
implementation and associated BRAC implementation offices for the 
service departments to discuss plans and procedures for updating these 
estimates. Further details on our scope and methodology can be found in 
appendix I. 

Overall, we determined that the data for this report were sufficiently 
reliable for comparing cost and savings estimates and identifying broad 
implementation challenges. We conducted this performance audit from 
February 2008 to December 2008 in accordance with generally accepted 
government auditing standards. Those standards require that we plan and 
perform the audit to obtain sufficient, appropriate evidence to provide 
a reasonable basis for our findings and conclusions based on our audit 
objectives. We believe that the evidence obtained provides a reasonable 
basis for our findings and conclusions based on our audit objectives. 

Results in Brief: 

Although DOD has made progress in implementing BRAC 2005, it faces 
several challenges, all of which put some recommendations at risk of 
not completing BRAC implementation by the statutory deadline of 
September 15, 2011. For example, DOD expects almost 400 of the total of 
about 800 locations to complete their BRAC recommendations in 2011, 
which is within the last 9 months of the statutory deadline, and about 
230 of these almost 400 locations are scheduled to complete their 
recommendations in the last 2 weeks of the statutory completion period. 
Further, some of these locations involve some of the most costly and 
complex BRAC recommendations, which have already incurred setbacks and 
thus have little leeway to meet the completion deadline if further 
delays occur. Also, as part of BRAC implementation, DOD is planning to 
synchronize the relocation of over 123,000 military and civilian 
personnel with nearly $23 billion in new construction or renovation 
projects, but some delays in starting construction projects have, in 
turn, left little time in the planning schedules to complete those 
relocations by the deadline. Finally, the interdependence of some BRAC 
recommendations creates additional challenges to meeting the statutory 
deadline, as a delay in completing one project could have a cascading 
effect on other interconnected BRAC moves. In response to these 
challenges, the Deputy Under Secretary of Defense (Installations and 
Environment) issued a memo dated November 21, 2008, providing guidance 
that required the military services and defense agencies to present OSD 
with status briefings on BRAC implementation beginning in December 
2008. The memo stated that these briefings will ensure that senior 
leadership is apprised of significant issues impacting timely 
implementation of BRAC recommendations. We believe this is a positive 
step toward enhancing OSD's oversight of BRAC implementation. However, 
because this guidance does not establish a regular briefing schedule or 
require the services to provide information about possible mitigation 
measures for any BRAC recommendations at risk of not meeting the 
statutory deadline, OSD may not be able to fully assist the services to 
complete their actions on time. We are making recommendations to 
improve the timeliness and completeness of the information the 
briefings will provide. 

DOD's BRAC fiscal year 2009 budget submission, which covers fiscal year 
2006 through fiscal year 2011, shows that DOD plans to spend more and 
save slightly less compared to last year's BRAC budget submission to 
implement BRAC recommendations. Specifically, DOD's 2009 estimated one- 
time costs to implement this round of BRAC increased by $1.2 billion to 
about $32.4 billion. Net annual recurring savings estimates decreased 
by almost $13 million to about $4 billion, compared to DOD's estimates 
in the fiscal year 2008 BRAC budget submission.[Footnote 9] In 
addition, our calculations of the net present value, which includes 
both estimated cost and savings over a 20-year period ending in 2025 
based on DOD's fiscal year 2009 BRAC budget and takes into account the 
time value of money, show that implementing the 2005 BRAC 
recommendations has declined to $13.7 billion (in constant fiscal year 
2005 dollars), compared to $15 billion that we previously reported 
using DOD's fiscal year 2008 BRAC budget.[Footnote 10] The BRAC 
Commission in 2005 reported that it estimated that DOD would save about 
$36 billion over this same 20-year period after the department 
implemented this round of BRAC. 

Although DOD is now about 3½ years into the statutory 6-year BRAC 
implementation period, the potential still remains for BRAC cost 
estimates to continue to increase in future BRAC budgets, but the 
potential for changes in savings estimates is unclear. Estimated costs 
for military construction could increase because of greater than 
expected inflation for building materials worldwide and increased 
market demands for construction, particularly for Army BRAC projects, 
which account for nearly 60 percent of the total BRAC construction cost 
estimates. For example, prices for construction materials such as 
steel, concrete, and copper rose by 18 percent to over 124 percent from 
2005 to 2008. The increase in the price of fuel through July 2008 has 
also contributed to increased construction costs, although fuel prices 
had declined by the time of our report. In addition, U.S. Army Corps of 
Engineers officials told us that the inflation rates they are required 
to use in developing BRAC budget estimates underestimate actual 
construction costs and that some construction bids from contractors are 
coming in at higher amounts than budgeted. We believe that if 
escalating pressures on the cost of commercial construction continue, 
DOD may have difficulty completing so many construction projects within 
current cost estimates by the statutory 2011 deadline, although recent 
changes in market conditions could reverse pricing trends in DOD's 
favor. At the same time, the potential for changes in BRAC savings 
estimates is unclear because some services do not plan to update their 
savings estimates regardless of factors that could cause those 
estimates to change, and OSD is not enforcing its own regulation 
requiring the services to do so. OSD officials told us that their focus 
has been mainly on formulating cost estimates and planning BRAC 
implementation. Nonetheless, DOD's financial management regulation for 
BRAC appropriations states that BRAC saving estimates must be based on 
the best projection of what savings will actually accrue from approved 
realignments and closures and that prior year estimated savings shall 
be updated to reflect actual savings.[Footnote 11] However, the 
services are implementing this regulation inconsistently or not at all. 
For example, officials responsible for implementing two recommendations 
associated with substantial expected savings--establishing naval fleet 
readiness centers at multiple installations and realigning defense 
medical care and training--told us that they were updating their 
savings estimates based on maturing implementation details. In 
contrast, BRAC implementing officials for both Army and Air Force 
headquarters told us that they plan to continue to report the same 
savings estimates that they reported to Congress in February 2007, 
despite any changes in implementation details or completion schedule 
that could cause those estimates to change. Without consistently 
updated BRAC savings estimates, DOD decision makers and Congress may be 
left with an unrealistic sense of the savings this BRAC round may 
actually produce. We are making a recommendation that BRAC savings 
estimates are based on the best projection of what savings will accrue 
from approved realignments and closures. 

In comments on a draft of this report, DOD concurred with all of our 
recommendations and noted that it has begun to implement them. DOD's 
written comments are reprinted in appendix V. 

Background: 

DOD has undergone four BRAC rounds since 1988 and is currently 
implementing its fifth round.[Footnote 12] In May 2005, the Secretary 
of Defense made public more than 200 recommendations that DOD estimated 
would generate net annual recurring savings of about $5.5 billion 
beginning in fiscal year 2012. Ultimately, the BRAC Commission 
forwarded a list of 182 recommendations for base closure or realignment 
to the President for approval and estimated that BRAC could save DOD 
annually about $4.2 billion after the recommendations had been 
implemented. After the BRAC Commission forwarded to the President its 
list of closure and realignment recommendations, the President was 
required to review and prepare a report approving or disapproving the 
BRAC Commission's recommendations by September 23, 2005. On September 
15, 2005, the President approved, and the recommendations were 
forwarded to Congress, which had 45 legislative days or until 
adjournment of Congress to enact a joint resolution disapproving of the 
recommendations on an all-or-none basis; otherwise, the recommendations 
became effective. The BRAC Commission's recommendations were accepted 
in their entirety by the President and not disapproved by Congress and 
became effective November 9, 2005. The BRAC statute requires DOD to 
complete recommendations for closing or realigning bases made in the 
BRAC 2005 round within a 6-year time frame ending September 15, 2011, 6 
years from the date the President submitted to Congress his approval of 
the recommendations. 

In making its 2005 realignment and closure proposals, DOD applied 
legally mandated selection criteria that included military value as the 
primary consideration, as well as expected costs and savings, economic 
impact to local communities, community support infrastructure, and 
environmental impact. Military value--which includes such 
considerations as an installation's current and future mission 
capabilities, condition, ability to accommodate future needs, and cost 
of operations--was the primary criteria for making recommendations as 
mandated by BRAC law and as reported by both DOD and the Commission. 
Additionally, 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. 

The 2005 round is unlike previous BRAC rounds because of OSD's emphasis 
on transformation and jointness, rather than just reducing excess 
infrastructure. For example, as part of the Army's efforts to transform 
its forces, the Army included actions to relocate forces from Europe 
and Korea to domestic installations, which were part of its larger 
review of bases worldwide. The 2005 round also differs from previous 
BRAC rounds in terms of the number of closure and realignment actions. 
While the number of major closures and realignments is a little greater 
than individual previous rounds, the number of minor closures and 
realignments is significantly greater than those in all previous rounds 
combined.[Footnote 13] DOD plans to execute over 800 closure and 
realignment actions as part of the 2005 BRAC round, which is more than 
double the number of actions completed in the prior four rounds 
combined. The large increase in the number of minor closures and 
realignments is primarily attributable to the more than 500 actions 
involving the Army National Guard and Army Reserve, representing over 
60 percent of the BRAC actions. 

To implement BRAC recommendations, DOD typically must incur various up- 
front investment costs during the 6-year implementation period in order 
to achieve long-term savings associated with the recommended actions. 
Such costs generally include, for example, one-time costs for actions 
such as military construction and personnel and equipment movement, as 
well as recurring costs for increased operation and maintenance of 
facilities and information systems. While savings from this investment 
may begin to accrue over the implementation period, additional savings 
typically occur annually on a longer-term basis beyond the 
implementation period ending in fiscal year 2011. One-time savings may 
include, for example, reduced costs associated with inventory reduction 
or elimination of planned military construction. Recurring savings may 
include for example, reduced sustainment costs associated with 
maintaining less warehouse space. Net annual recurring savings after 
the implementation period are calculated by subtracting the annual 
recurring costs from the annual recurring savings. Expected 20-year 
savings, also referred to as 20-year net present value savings, takes 
into account all one-time and recurring costs and savings incurred over 
the fiscal year 2006 through 2025 time period.[Footnote 14] 

For the BRAC 2005 round, the OSD BRAC Office--under the oversight of 
the Under Secretary of Defense (Acquisition, Technology and Logistics)-
-has monitored the services' and defense agencies' implementation 
progress, analyzed budget justifications for significant differences in 
cost and savings estimates, and facilitated the resolution of any 
challenges that may impair the successful implementation of the 
recommendations within the 6-year completion period. To facilitate its 
oversight role, OSD required the military departments and certain 
defense agencies to submit a detailed business plan for each of their 
recommendations. These business plans, which are to be updated every 6 
months, include information such as a listing of all actions needed to 
implement each recommendation, schedules for personnel movements 
between installations, updated cost and savings estimates based on 
better and updated information, and implementation completion time 
frames. 

Challenges Increase the Risk That Some BRAC Recommendations Might Not 
Be Completed by the Statutory Deadline: 

DOD has made progress in implementing the BRAC 2005 round but faces 
challenges in its ability to meet the September 15, 2011, statutory 
completion deadline. DOD is more than halfway through the 
implementation period for BRAC 2005 and has made progress thus far. 
However, DOD faces several challenges to completing BRAC actions at 
some locations on time. First, DOD expects almost half of the 800 
defense locations responsible for implementing BRAC to complete their 
recommendations within months of the deadline, and about 230 of those 
locations anticipate completion within the last 2 weeks of the 
implementation period. Second, some of these locations, which involve 
the most costly and complex recommendations, have already encountered 
delays in their implementation schedules. Third, DOD must synchronize 
relocating over an estimated 123,000 personnel with the construction or 
renovation of facilities. Finally, delays in interdependent 
recommendations could have a cascading effect on the timely completion 
of related recommendations. OSD recently issued guidance requiring the 
services and defense agencies to provide status briefings to improve 
oversight of issues affecting timely implementation of BRAC 
recommendations. However, this guidance did not establish a regular 
briefing schedule as needed or require the services to provide 
information about possible mitigation measures for any BRAC 
recommendations at risk of not meeting the statutory deadline. 

DOD Has Made Progress in Implementing BRAC: 

DOD is more than halfway through the implementation period for BRAC 
2005 and has made steady progress thus far. In June 2008, DOD reported 
to Congress that 59 of 800 affected locations have completed their BRAC 
actions associated with that location as of December 1, 2007. While 
much remains to be done, DOD is awarding construction contracts, and 
DOD officials told us that fiscal years 2008 and 2009 should be the 
years with the greatest number of construction contract awards. Also, 
officials told us that high rates of obligation for BRAC military 
construction funds in fiscal year 2008 indicate that the services and 
defense agencies are generally meeting schedules for awarding 
construction contracts. 

This was the first BRAC round in which DOD required the services and 
defense agencies that implement the recommendations to prepare business 
plans for approval by the OSD BRAC Office. These business plans provide 
information on actions and time frames as well as cost and savings to 
help guide implementation. Services and defense agencies responsible 
for implementing BRAC recommendations were required to obtain business 
plan approval before beginning implementation. Business plans are 
updated twice a year, represent the most current information available 
on each recommendation, and serve as a tool for DOD to oversee the 
implementation of this BRAC round but do not include analysis of the 
likelihood of completing the recommendation on time. 

DOD Faces Several Challenges to Completing BRAC Actions at Some 
Locations on Time: 

DOD faces several challenges in its ability to implement this round of 
BRAC by the September 15, 2011, statutory completion deadline. By 
statute, DOD must complete the recommendations for closing or 
realigning bases made in the BRAC 2005 round within 6 years from the 
date the President submitted to Congress his approval of the BRAC 
Commission's recommendations. Although DOD has made implementation 
progress in the last 3½ years since BRAC became effective, the 
department still faces a number of challenges that could affect its 
ability to complete all BRAC actions by the statutory deadline. 

Many Defense Locations Are Expected to Complete BRAC within Months of 
the Statutory Deadline: 

As of June 2008, DOD reported to Congress[Footnote 15] that about half 
out of 800 defense locations that are affected by BRAC recommendations 
expect to complete their BRAC-related actions within the last 9 months 
of the statutory deadline of September 15, 2011. Further, our analysis 
of DOD's data shows that about 60 percent, or about 230, of these 400 
locations expect to complete their BRAC actions in September 2011--the 
last two weeks before the statutory deadline. OSD BRAC officials told 
us some locations might have reported completion dates near the end of 
the BRAC deadline to allow extra time, although such a practice could 
represent potentially inaccurate completion estimates. Still, we 
believe DOD's data provide an indicator of the number of locations that 
have little room for delays in the BRAC completion schedule. 

DOD Has Experienced Various Delays in the Implementation Schedule for 
Some of the Most Costly and Complex BRAC Recommendations: 

Some of the most costly and complex BRAC recommendations that DOD has 
yet to fully implement have already incurred some setbacks in 
implementation because of several reasons, including construction 
problems, the requirement to study environmental impacts, and delays in 
making decisions about site locations, awarding contracts and acquiring 
land. According to our analysis, the recommendations discussed are 
among the most costly, and represent about 30 percent of the total 
estimated costs to implement this round of BRAC. Many of these 
recommendations are also complex in that they involve movement of a 
large number of personnel, large construction projects, and 
synchronization with other recommendations. Some of the most costly 
recommendations that have experienced delays are as follows: 

* Close National Geospatial-Intelligence Agency leased locations and 
realign others to Fort Belvoir, Virginia. DOD officials told us that 
construction of the National Geospatial-Intelligence Agency's new $1.5 
billion building at Fort Belvoir is currently on schedule. However, 
there is minimal schedule margin, and as a result, any unmitigated 
disruptions can jeopardize maintaining the complex construction 
schedule required to move 8,500 personnel by the statutory deadline. 
The estimated cost to implement this recommendation is $2.4 billion 
according to DOD's fiscal year 2009 budget and the estimated completion 
date is September 2011. 

* Establish San Antonio Regional Medical Center and realign enlisted 
medical training to Fort Sam Houston, Texas. As part of this 
recommendation, DOD is realigning the inpatient medical function from 
Lackland Air Force Base to Brooke Army Medical Center at Fort Sam 
Houston. However, officials with the San Antonio Joint Program Office, 
which was established to help implement the BRAC decisions affecting 
San Antonio, told us that construction contract delays have left little 
time in the implementation schedule to meet the statutory deadline. The 
estimated cost to implement this recommendation is $1.7 billion, 
according to DOD's fiscal year 2009 budget, and the estimated 
completion date is September 2011. 

* Realign Walter Reed Army Medical Center to Bethesda National Naval 
Medical Center, Maryland. Tri-Care Management Activity officials told 
us that although the implementation schedule for meeting the deadline 
for this recommendation is on an accelerated track, it will still be 
tight to meet the 2011 deadline. These officials told us it is taking 
additional time to finalize the plans for building a world-class 
medical center facility. According to DOD's fiscal year 2009 budget, 
the estimated cost to implement this recommendation is $1.6 billion, 
and the estimated completion date is September 2011. 

* Realign Maneuver Training to Fort Benning, Georgia. Construction 
delays to provide facilities associated with the realignment of the 
Army's Armor School at Fort Knox, Kentucky, with the Infantry School at 
Fort Benning, Georgia, to create the new Maneuver Training Center have 
occurred because of concerns about environmental disturbances to the 
habitat of the Red-Cockaded Woodpecker at Fort Benning. According to 
Army officials, these delays have left little, if any, time in the 
implementation schedules to absorb further delays. The estimated cost 
to implement this recommendation is $1.5 billion, according to DOD's 
fiscal year 2009 budget, and the estimated completion date is August 
2011. 

* Co-locate miscellaneous OSD, defense agency, and field activity 
leased locations in the District of Columbia Metropolitan Area. Various 
delays in the process to select a permanent site for co-locating about 
6,400 personnel have slipped the time frame for starting the 
implementation of this recommendation. The Army had originally planned 
to relocate these agencies and activities to Fort Belvoir's Engineering 
Proving Ground, but in August 2007, announced it was considering a 
nearby location belonging to the U.S. General Services Administration 
in Springfield, Virginia. Then, in October 2007, the Army announced it 
was also considering other sites in Northern Virginia, finally deciding 
on a site in Alexandria, Virginia in September 2008.[Footnote 16] These 
delays, according to Army BRAC officials, have significantly compressed 
the time available to build new facilities and move thousands of 
personnel by the 2011 statutory deadline. The estimated cost to 
implement this recommendation is $1.2 billion according to DOD's fiscal 
year 2009 budget, and the estimated completion date is September 2011. 

* Close Fort McPherson, Georgia. The relocation of Headquarters U.S. 
Army Forces Command and Headquarters U.S. Army Reserve Command to Fort 
Bragg, North Carolina, because of the closure of Fort McPherson, has 
experienced delays. The construction contract for building a new 
facility for the commands was delayed by 3½ months while requirements 
for the building were being refined and may jeopardize the Army's 
ability to meet the BRAC deadline. According to Forces Command 
officials, there will be enough time to finish construction only if the 
Army encounters no further significant complications during 
construction. The construction contract was initially to be awarded in 
May 2008 but was delayed until September 2008, and the schedule to 
fully transfer Forces Command to Fort Bragg is very tight. The 
estimated cost to implement this recommendation is $798 million, 
according to DOD's fiscal year 2009 budget, and the estimated 
completion date is September 2011. 

* Realign Fort Bragg, North Carolina. Part of this recommendation 
requires the relocation of the Army's 7th Special Forces Group to Eglin 
Air Force Base, Florida. However, delays resulting from concerns about 
the noise from the Joint Strike Fighter aircraft, which will also be 
located at Eglin, through the implementation of another BRAC 
recommendation, have contributed to uncertainties on where to relocate 
the Special Forces Group at Eglin. As a result, obtaining the required 
environmental impact studies has taken longer than originally 
anticipated. As of December 2008, the Army had not started construction 
of the needed facilities to relocate over 2,200 military personnel from 
Fort Bragg to Eglin.[Footnote 17] Construction was originally planned 
to start in October 2008. According to Special Operations officials at 
Fort Bragg, the time frame to complete this move is extremely tight 
because of these delays, and they expressed to us their doubts about 
completing $200 million in construction on time in order to move all 
military personnel by the deadline. The estimated cost to implement 
this recommendation is $327 million, according to DOD's fiscal year 
2009 budget, and the estimated completion date is September 2011. 

In addition to the BRAC actions discussed, we also found other BRAC 
actions that have experienced delays that could jeopardize DOD's 
ability to meet the statutory 2011 BRAC deadline. Although the 
individual recommendations are not among the most costly to implement, 
collectively they illustrate further challenges DOD faces as follows: 

* Realign Army reserve components and construct new Armed Forces 
Reserve Centers. According to Army BRAC officials and our analysis, 
time frames will be tight for completing some of the BRAC 
recommendations involving building 125 new Armed Forces Reserve 
Centers. According to Army officials, land still has not yet been 
acquired for some of these reserve centers. Also, we have previously 
reported that other BRAC funding priorities caused the Army to delay 
the start of 20 armed forces reserve projects, compressing the amount 
of time available to construct the facilities and respond to any 
construction delays that might arise.[Footnote 18] The Army rescheduled 
the start of these projects that it had initially planned to begin 
construction in either fiscal year 2008 or 2009 to fiscal year 2010-- 
the second to the last year of the BRAC statutory completion period. 

* Relocate medical command headquarters. Tri-Care Management Activity 
officials responsible for implementing this BRAC recommendation told us 
they have had delays in deciding on the actual site to relocate medical 
command headquarters in the Washington, D.C., area. Factors for the 
delay include higher than expected cost estimates to renovate a 
possible site in Maryland and that the current occupants of this site 
are not expected to vacate the property until 2011, which would be too 
late to meet the BRAC completion deadline. Anticipating that leasing a 
site might be the only viable alternative, these officials told us that 
once a final decision on a site was made, they would be in a more 
informed position to state whether enough time will be available to 
move several thousand personnel into a leased site by the BRAC 
deadline. 

Synchronization of Personnel and Equipment Moves with Completion of 
Construction Projects Is a Challenge: 

DOD will face significant challenges in synchronizing the moves of all 
personnel and equipment into their new locations. Specifically, DOD 
must synchronize the relocation of over 123,000 personnel with the 
construction of an estimated $23 billion in new or renovated 
facilities. However, delays have left little time in the planning 
schedule to relocate these personnel by the deadline. For example, the 
already tight construction schedule for the new National Geospatial- 
Intelligence Agency building at Fort Belvoir has created some risk for 
integrating construction activities with the installation of 
information systems and the relocation of 8,500 agency employees to the 
new location, according to Fort Belvoir BRAC officials. Fort Belvoir 
officials also described for us the very complex and detailed ongoing 
planning for integrating the movement of the numerous organizations 
affected by another BRAC recommendation that seeks to eliminate leased 
locations for various Army organizations and consolidate them into two 
buildings on Fort Belvoir. The officials are conducting a detailed 
review of the requirements for each organization to ensure that there 
is enough space for everyone and to develop a schedule to move these 
organizations into the facility. Complicating the development of this 
schedule is that many of these organizations work with highly 
classified, sensitive information and cannot operate outside secured 
space with controlled access. 

Other DOD initiatives outside BRAC will complicate the synchronizing of 
schedules for moving of people and equipment associated with BRAC. For 
example, the Army plans to increase the size of its active-duty force 
by about 65,000 over the next several years. In addition, the 
repositioning of forces currently stationed in Europe and the Army's 
ongoing reorganization to become a more modular, brigade-based force 
have caused other movements and relocations that have to be integrated 
with the BRAC implementation schedules. The military is also planning 
on drawing down the level of troops in Iraq and returning some of these 
forces to U.S. installations. The actions required to simultaneously 
implement these initiatives with BRAC further complicate the 
integration of moving schedules for people and equipment and raise the 
level of risk for further schedule disruptions, which, in turn, raise 
the risk of BRAC recommendations missing the statutory deadline. 

Interdependence of Some Moves Creates Additional Challenges: 

Some BRAC locations are unable to begin renovation of buildings slated 
to house realigning organizations until current tenants of these 
buildings vacate, a situation that has delayed the beginning of 
implementation. For example, as we have previously reported, as part of 
the BRAC recommendation to close Fort Monmouth, New Jersey, personnel 
from the Army's Communications-Electronics Life Cycle Management 
Command currently located at Fort Monmouth are relocating to Aberdeen 
Proving Ground, Maryland. Army officials originally planned to renovate 
facilities currently occupied by a training activity for some of these 
employees. The training activity is scheduled to relocate to Fort Lee, 
Virginia, through another BRAC action; however, Army officials said 
that the new facilities for the training activity would not be complete 
as originally planned, a setback that, in turn, would delay the 
renovation of the Aberdeen facilities for the incoming employees. The 
delays in construction at Fort Lee resulted in the Army having to plan 
to build a new facility, rather than renovate an existing facility at 
Aberdeen Proving Ground at an additional cost of $17 million, to avoid 
the risk that the facility renovations could not completed in time for 
the personnel to relocate into renovated facilities at 
Aberdeen.[Footnote 19] 

According to a Fort Belvoir official, two buildings at the installation 
will be used to house various Army organizations that are currently in 
leased space and will be relocating to Fort Belvoir as directed in a 
BRAC recommendation. However, the Army Materiel Command is still using 
the two buildings pending its relocation to Huntsville, Alabama, as 
part of another BRAC recommendation. To further complicate the 
situation, the Army Materiel Command is hiring employees for a new 
organization, to be called Army Contracting Command, which will also be 
housed in the two buildings eventually planned to house the Army 
organizations that are currently in leased space. Until Army Materiel 
Command and the newly hired employees of Army Contracting Command move 
out of these buildings, Fort Belvoir officials cannot begin renovating 
the building for its new tenants. However, construction delays in 
Huntsville have caused the Army Materiel Command to delay its move to 
the Huntsville area. Furthermore, Fort Belvoir officials told us that a 
decision has not yet been made on the location for the newly formed 
Army Contracting Command and that if both this new command as well as 
the Army Materiel Command do not vacate the two buildings in question 
by June 2011, it would be nearly impossible to meet the statutory 
deadline. Again, this example demonstrates that delays in 
interdependent recommendations could have a cascading effect on other 
recommendations being completed on time. 

OSD Recently Took Action to Obtain More Information on Issues That 
Could Affect Meeting the Statutory Deadline: 

As we concluded our fieldwork, the Deputy Under Secretary of Defense 
(Installations and Environment) issued a memo dated November 21, 2008, 
providing guidance that required the military services and defense 
agencies to present periodic status briefings to OSD on implementation 
progress "to ensure senior leadership is apprised of significant issues 
impacting implementation of the BRAC recommendations" by the September 
15, 2011, deadline. According to this guidance, at a minimum, the 
briefings are to include information on projected and actual 
construction contract award dates and construction completion dates, as 
well as BRAC actions completed. The requirement to provide these 
briefings is applicable only to those recommendations that are expected 
to have a one-time cost of $100 million or greater. The first round of 
such briefings was conducted in the first two weeks of December 2008. 
We believe that OSD should be commended for taking this positive step 
toward enhancing its oversight of BRAC implementation. However, OSD may 
still not be in a position to fully assist the services in taking 
mitigating measures, if warranted, to better ensure all BRAC actions 
are completed by the statutory deadline because the guidance does not 
establish a regular briefing schedule or require the services to 
provide information about possible mitigation measures. 

First, the guidance does not require the briefings to be conducted on a 
firm schedule for the duration of the implementation period. Unlike 
BRAC business plans that are to be updated every 6 months, after an 
initial round of briefings to be conducted in December 2008, the 
guidance requires only periodic updates to status briefing "as 
necessary" and does not specify who determines when such updates are 
deemed necessary. However, given the large number of locations that 
expect to complete their BRAC actions within months or weeks of the 
statutory deadline and the possibility of delays where little leeway 
exists, OSD would benefit from early warning and consistent monitoring 
of implementation challenges that could put completion schedules at 
those locations at further risk. 

Second, OSD's recent guidance does not require the services and defense 
agencies to provide information about steps that could be taken to 
mitigate the effects of the implementation challenges they identify. We 
have advocated the use of a risk management approach to reduce, where 
possible, the potential that an adverse event will occur, reducing 
vulnerabilities as appropriate, and putting steps in place to reduce 
the effects of any event that does occur.[Footnote 20] With information 
about mitigation strategies that the services have developed or could 
develop, OSD BRAC could be in a position to provide assistance and 
coordination that could better enable the services and defense agencies 
to stay on schedule. 

BRAC Implementation Cost Estimates Are Higher and Savings Estimates Are 
Lower Compared to Previous Fiscal Year: 

DOD's BRAC fiscal year 2009 budget submission shows that DOD plans to 
spend more and save less as compared to last year's BRAC budget 
submission to implement the recommendations. DOD's 2009 estimated one- 
time costs to implement this BRAC round increased by $1.2 billion. Net 
annual recurring savings estimates decreased by almost $13 million. In 
addition, our calculations show that expected savings over a 20-year 
period ending in 2025 declined by $1.3 billion. 

Estimated One-Time Costs Have Increased: 

DOD's BRAC fiscal year 2009 budget submission shows that DOD plans to 
spend more to implement its BRAC recommendations compared to last 
year's BRAC budget. Specifically, DOD's cost estimates increased by 
$1.2 billion in DOD's 2009 budget to a total estimated cost of $32.4 
billion to implement this BRAC round. In September 2005, the BRAC 
Commission originally estimated the costs to be about $21 billion. The 
overall estimated cost increase of $1.2 billion is a cumulative cost 
increase because some recommendations are expected to cost less while 
others could cost more. Nonetheless, our analysis shows that $1.1 
billion (93 percent) of the estimated $1.2 billion increase occurred in 
six recommendations. For example, the recommendation to realign the 
National Geospatial-Intelligence Agency to Fort Belvoir, Virginia, had 
the largest increase in estimated costs--almost $350 million. Five 
other recommendations make up the remaining majority of the estimated 
cost increase: 1) close Fort McPherson, Georgia; 2) close Fort 
Monmouth, New Jersey; 3) establish a regional medical center and 
realign medical training to Fort Sam Houston, Texas; 4) consolidate 
depot-level reparable procurement management; and 5) realign to 
establish the Combat Service Support Center at Fort Lee, Virginia. 
Table 1 shows the increase in cost estimates for these six 
recommendations comparing fiscal year 2008 budgets to fiscal year 2009 
budgets. 

Table 1: BRAC Recommendations with the Largest Increases in One-Time 
Estimated Costs from Fiscal Year 2008 to Fiscal Year 2009: 

Dollars in millions. 

Close National Geospatial-Intelligence Agency leased locations and 
realign others at Fort Belvoir, Va; 
Fiscal year 2008 cost estimate: $2,091; 
Fiscal year 2009 cost estimate: $2,441; 
Net cost increase: $350. 

Close Fort McPherson, Ga; 
Fiscal year 2008 cost estimate: 550; 
Fiscal year 2009 cost estimate: 798; 
Net cost increase: 248. 

Close Fort Monmouth, N.J; 
Fiscal year 2008 cost estimate: 1,458; 
Fiscal year 2009 cost estimate: 1,595; 
Net cost increase: 136. 

Establish San Antonio Regional Medical Center and realign enlisted 
medical training to Fort Sam Houston, Tex; 
Fiscal year 2008 cost estimate: 1,591; 
Fiscal year 2009 cost estimate: 1,724; 
Net cost increase: 133. 

Consolidate depot level reparable procurement management; 
Fiscal year 2008 cost estimate: 264; 
Fiscal year 2009 cost estimate: 392; 
Net cost increase: 128. 

Realign to establish Combat Service Support Center at Fort Lee, Va; 
Fiscal year 2008 cost estimate: 1,145; 
Fiscal year 2009 cost estimate: 1,270; 
Net cost increase: 124. 

Total one-time estimated costs from the BRAC recommendations listed 
above; 
Fiscal year 2008 cost estimate: $7,099; 
Fiscal year 2009 cost estimate: $8,219; 
Net cost increase: $1,120. 

Total one-time estimated costs from all other BRAC recommendations; 
Fiscal year 2008 cost estimate: $24,133; 
Fiscal year 2009 cost estimate: $24,214; 
Net cost increase: $81. 

Total one-time estimated costs for all BRAC recommendations; 
Fiscal year 2008 cost estimate: $31,232; 
Fiscal year 2009 cost estimate: $32,433; 
Net cost increase: $1,201. 

Source: GAO analysis of DOD data. 

Notes: Amounts are in current dollars (i.e., includes projected 
inflation). 

Totals may not add because of rounding. 

[End of table] 

In addition, various cost categories that make up each recommendation's 
estimated costs have also experienced increases and decreases when 
comparing DOD's fiscal year 2008 budget to the fiscal year 2009 budget. 
These cost categories are one-time costs for items and activities such 
as construction, environmental clean-up, and operation and maintenance. 
Our analysis of DOD's budget data showed the largest estimated cost 
increase occurred in the military construction cost category. For 
example, estimated construction costs increased by nearly $1.5 billion; 
however, this cost increase was offset by decreases in other cost 
categories as shown in table 2. 

Table 2: Comparison of BRAC Cost Categories from Fiscal Year 2008 to 
Fiscal Year 2009: 

Dollars in millions. 

Military construction; 
Fiscal year 2008 cost estimate: $21,281; 
Fiscal year 2009 cost estimate: $22,765; 
Cost estimate increase or (decrease) from fiscal year 2008 to 2009: 
$1,484. 

Operation and maintenance; 
Fiscal year 2008 cost estimate: 6,649; 
Fiscal year 2009 cost estimate: 7,134; 
Cost estimate increase or (decrease) from fiscal year 2008 to 2009: 
485. 

Other[A]; 
Fiscal year 2008 cost estimate: 2,008; 
Fiscal year 2009 cost estimate: 1,561; 
Cost estimate increase or (decrease) from fiscal year 2008 to 2009: 
(447). 

Environmental; 
Fiscal year 2008 cost estimate: 792; 
Fiscal year 2009 cost estimate: 525; 
Cost estimate increase or (decrease) from fiscal year 2008 to 2009: 
(267). 

Miscellaneous[B]; 
Fiscal year 2008 cost estimate: 503; 
Fiscal year 2009 cost estimate: 449; 
Cost estimate increase or (decrease) from fiscal year 2008 to 2009: 
(54). 

Total costs; 
Fiscal year 2008 cost estimate: $31,233; 
Fiscal year 2009 cost estimate: $32,434; 
Cost estimate increase or (decrease) from fiscal year 2008 to 2009: 
$1,201. 

Source: GAO analysis of DOD provided data. 

Note: Totals may not add because of rounding. 

[A] The other cost category is composed of items such as information 
technology items. 

[B] Miscellaneous costs includes various items such as military 
personnel permanent change of station, homeowners assistance program, 
one-time costs funded outside the BRAC account, and other DOD-made 
funding adjustments. 

[End of table] 

The overall total increase of $1.2 billion does not include about $416 
million to accelerate and enhance the realignment and closure of Walter 
Reed Army Medical Center in the District of Columbia and the movement 
of its operations to the renovated Bethesda Naval Medical Center, 
Maryland, and a new hospital at Fort Belvoir, Virginia. DOD received 
these funds in its fiscal year 2008 supplemental request. OSD BRAC 
officials told us that they intend to seek an additional $263 million 
to complete the Walter Reed realignment, but these funds have not yet 
been provided and are also not included in the overall total increase 
of $1.2 billion. According to OSD BRAC officials, $416 million will be 
reflected in the fiscal year 2010 President's Budget, as will the 
additional $263 million if these funds are provided to BRAC before the 
2010 budget is submitted to Congress sometime in early 2009. 

In addition, our analysis of the 2005 BRAC round, based on DOD's fiscal 
year 2009 budget estimates, indicates that relatively few 
recommendations are responsible for a majority of the expected cost. 
Specifically, we determined that the planned implementation of 30 
recommendations (or about 16 percent of the total 182 recommendations) 
is expected to account for about 72 percent of the expected one-time 
costs. (See app. II for a listing of those BRAC recommendations DOD 
expects to cost the most.) 

Net Annual Recurring Savings Estimates Have Decreased: 

While estimated implementation costs have risen, overall estimated net 
annual recurring savings[Footnote 21] have decreased slightly by about 
$13 million to about $4 billion based on DOD's approach to include 
savings from military personnel who transferred or shifted from one 
location to another but remained on the payroll.[Footnote 22] In 
September 2005, the BRAC Commission originally estimated annual 
recurring savings to be about $4.2 billion. This amount included the 
savings associated with military personnel eliminations. Some 
recommendation savings estimates have decreased while others have 
increased, but the cumulative effect is an overall decrease in 
estimated annual recurring savings. For example, the largest decrease 
in net annual recurring savings was about $84 million for the 
recommendation to establish joint bases, which decreased from about 
$116 million in savings in the fiscal year 2008 budget submission to 
$32 million in the fiscal year 2009 budget submission. Discussions with 
agency officials involved with implementing this recommendation 
indicate that the savings could decrease further in the future. In 
contrast, the largest increase in net annual recurring savings was 
about $58 million for the recommendation to establish the San Antonio 
Regional Medical Center and realigning enlisted medical training to 
Fort Sam Houston, Texas, which increased from about $91 million in 
savings in the fiscal year 2008 budget submission to $149 million in 
the fiscal year 2009 budget submission. OSD BRAC officials told us they 
expect 2012 to be the first year to accrue the full amount of net 
annual recurring savings because some recommendations are not expected 
to be completed until around the September 15, 2011, deadline and 
significant savings generally do not begin to accrue until 
implementation is complete. 

Twenty-Year Savings Have Decreased: 

Given the cumulative increase in estimated one-time costs and decrease 
in estimated net annual recurring savings, the estimated savings over a 
20-year period ending in 2025, based on DOD's fiscal year 2009 budget 
submission, has also decreased.[Footnote 23] Our calculations show that 
the 20-year savings declined almost 9 percent by $1.3 billion to about 
$13.7 billion, compared to $15 billion that we estimated based on the 
fiscal year 2008 budget. In September 2005, the BRAC Commission 
estimated that DOD would save about $36 billion over this 20-year 
period--the current estimate is a reduction of about 62 percent from 
the BRAC Commission's reported estimates. Further, we determined that 
30 recommendations (about 16 percent of all 2005 BRAC recommendations) 
account for about 85 percent of the expected savings over a 20-year 
period. (See app. IV for a listing of those BRAC recommendations DOD 
expects to save the most over a 20-year period.) The decrease in 20- 
year savings is directly related to the growth in estimated one-time 
cost and to the reduction in estimated annual recurring savings. 

As with annual recurring savings, the 20-year savings estimate of about 
$13.7 billion includes the savings associated with the elimination of 
military personnel. We have previously reported that military personnel 
position eliminations are not a true source of savings since DOD 
intends to reassign or shift personnel to other positions without 
reducing military end strength associated with the corresponding BRAC 
recommendation.[Footnote 24] DOD disagrees with our position. 

In addition, our analysis shows the number of BRAC recommendations not 
expected to achieve net savings over a 20 year period has continued to 
increase since 2005. Specifically, based on the revised 20-year savings 
estimates, 74 recommendations are not expected to result in a positive 
net savings over 20 years, compared to 73 we identified in fiscal year 
2008, and 30 estimated by the BRAC Commission in 2005. OSD BRAC 
officials told us that, although the 20-year savings estimate is less 
than was estimated in 2005 by the BRAC Commission, the department 
expects the implementation of this BRAC round to produce capabilities 
that will enhance defense operations and management, despite less than 
anticipated savings. 

Cost Estimates Could Continue to Rise, but the Potential for Savings 
Estimates to Change Is Unclear: 

Although DOD is almost 3½ years into the 6-year implementation period 
for this round of BRAC, cost estimates could potentially continue to 
increase, but the potential for changes in savings estimates is less 
clear. Cost estimates could increase because of inflation and increased 
demand for construction in some areas, although changing market 
conditions that existed at the time of our report could reverse these 
trends in DOD's favor. There is less visibility into potential changes 
in savings estimates because some military services and defense 
agencies are not periodically updating their BRAC savings estimates, 
and OSD is not enforcing its regulation requiring them to do so. 

Cost Estimates Could Continue to Rise: 

BRAC 2005 implementation costs have the potential to continue to 
increase because of sharp increases in the prices of fuel and in 
construction materials such as steel, concrete and copper during most 
of 2008. The one-time implementation cost estimates for BRAC 2005 rose 
by about $1.2 billion from fiscal years 2008 to 2009 primarily because 
of increases in the cost of military construction. The potential for 
additional cost increases is particularly important to the Army, as it 
is expected to incur the majority of the military construction costs 
related to base closures and realignments. For example, our analysis of 
DOD's fiscal year 2009 BRAC budget data shows that the Army's estimated 
cost of about $13 billion for BRAC military construction accounted for 
nearly 60 percent of the total BRAC military construction estimate of 
about $22.8 billion. Moreover, the factors that drove the military 
construction costs up in fiscal year 2007 continued to exert upward 
pressure on prices through the end of fiscal year 2008. According to 
the U.S. Army Corps of Engineers officials, the prices of steel, 
concrete, and copper rose considerably from 2005 to 2008 because of 
worldwide demand. Our analysis of producer price index data compiled by 
the Bureau of Labor Statistics found that the price of steel rose by 
about 40 percent over that period. The price of concrete rose by about 
18 percent, while copper rose over 124 percent from 2005 to 2008. In 
addition, fuel prices rose steadily from 2007 until August 2008, when 
they started to drop. 

Another factor that could drive up construction prices is the increased 
demand for construction in some markets. Specifically, BRAC 
implementing officials expressed concern that construction costs have 
the potential to increase in areas already experiencing high commercial 
construction demands such as the National Capital Region, Washington, 
D.C., and San Antonio, Texas. Army Corps of Engineers officials told us 
they are concerned about what effect construction demand might have on 
bids given the sizable amount of construction to take place in a 
limited amount of time to meet the BRAC statutory completion time 
frame. Additionally, service officials at various installations 
expressed concern about the potential for increases in construction 
costs because of ongoing reconstruction because of damage caused by 
natural disasters such as hurricanes and flooding, coupled with the 
large volume of anticipated BRAC construction that could also affect 
bids. 

Further, we reported in December 2007[Footnote 25] that the inflation 
rates prescribed by DOD and the Office of Management and Budget for 
developing BRAC budget estimates had been lower than the actual rate of 
construction inflation for the last several years; therefore, the use 
of these rates could underestimate actual construction costs. To the 
extent that the actual rate of inflation continues to exceed the 
budgeted rate as implementation proceeds, and construction material 
costs are higher than anticipated, U.S. Army Corps of Engineers 
officials have said that they would either have to redirect funding 
from other sources to provide for construction projects or resort to a 
reduction in the scope of some construction projects. 

Although the economy slowed down and fuel prices began to drop in mid- 
to-late 2008, several bids for construction contracts that had been 
advertised prior to these events have come in at levels higher than 
programmed by the U.S. Army Corps of Engineers. For example, the 
construction bids to build a general instruction complex associated 
with the BRAC recommendation to create a Maneuver Center at Fort 
Benning, Georgia, were $16 million over budgeted amounts. In another 
case, the estimate for building a defense media center is currently $65 
million, while the programmed amount is $44 million--a difference of 
$21 million. Although bids have been above budgeted amounts for some 
projects, the difference has been offset to some extent by other bids 
that had come in under budgeted amounts for other projects. 

Furthermore, as a result of the increasing construction prices, higher 
than expected construction bids, and revisions to facility designs and 
scope, the Army identified a potential BRAC cost increase of 
approximately $2.6 billion, with military construction accounting for 
about $1.4 billion and various operation and maintenance costs 
accounting for the remaining $1.2 billion. In the summer of 2008, Army 
officials told us that a high-level meeting was held with Army 
leadership, known as the Stationing Senior Review Group, to discuss 
ways to resolve the potential BRAC cost increases. Subsequently, the 
Army's Office of the Assistant Chief of Staff for Installation 
Management made clear in an August 2008 memorandum that further growth 
in BRAC 2005 implementation must be avoided. BRAC officials told us 
that the results of these discussions on potential cost increases would 
be reflected in the fiscal year 2010 budget submission to Congress. DOD 
expects the release of the fiscal year 2010 BRAC budget submission to 
be after the issuance of this report; thus, we are unable to comment on 
Army's recent actions to contain further cost growth related to it base 
closures and realignments. 

We believe that if the escalating pressures on the cost of construction 
continue, DOD may have difficulty in completing planned construction 
projects within currently estimated amounts in the BRAC accounts. 
However, at the time we concluded our fieldwork in December 2008, the 
U.S. economy had begun to experience a slowdown. Fuel prices, for 
example, had dropped precipitously compared to where they had been 
earlier in the year. The price of copper and concrete had also begun to 
decline, but prices of these two commodities nonetheless remained above 
2007 levels. A continued reduction in commodities prices and further 
downturn in the U.S. economy could work in DOD's favor to reduce the 
price of future construction contracts. 

Potential for Savings Estimates to Change Is Unclear: 

For the current BRAC round, the potential for savings estimates to 
change is unclear because some military services are not updating their 
savings estimates as required by DOD regulation.[Footnote 26] DOD's 
Financial Management Regulation for BRAC appropriations has instructed 
the services and defense agencies to update estimates in their annual 
budget submissions since at least June 1998. Specifically, the 
regulation requires that budget justification books include exhibits 
reporting savings estimates for the BRAC 2005 round that are based on 
the best projection of what savings will actually accrue from approved 
realignments and closures. Further, the regulation states that prior 
year estimated savings must be updated to reflect actual savings, when 
available. 

Our prior and current work shows that some of the military services 
have not updated their savings estimates periodically, thereby 
contributing to unrealistic BRAC net savings estimates. Specifically, 
our analysis shows that some of the defense agencies and the Navy 
updated savings estimates for some of their recommendations. For 
example, on the one hand, officials responsible for implementing two 
BRAC recommendations associated with substantial expected savings-- 
establishing naval fleet readiness centers at multiple installations 
across the country and realigning medical care and training in San 
Antonio, Texas--told us they updated their savings estimates in the 
fiscal year 2009 BRAC budget based on maturing implementation plans. On 
the other hand, BRAC implementing officials for the Army and the Air 
Force told us they do not plan to update their savings estimates and 
will continue to report the same savings estimates reported to Congress 
in February 2007 despite any revisions in implementation details or 
completion schedules that could cause savings estimates to change. Army 
and Air Force officials told us that, since the savings reported to 
Congress had already been "taken" from their budgets, there was no 
incentive to update those estimates. Thus, Army and Air Force officials 
told us that they do not plan to update savings estimates for the 
remainder of BRAC implementation, despite the requirement in DOD's 
Financial Management Regulation to do so. However, outdated savings 
estimates undermine the ability of Congress to monitor savings, a key 
indicator of success in BRAC implementation. 

The issue of updating BRAC savings estimates is not new. We have 
previously reported that the military services, despite DOD guidance 
directing them to update savings estimates (for prior BRAC rounds) in 
their annual budget submissions, had not periodically updated these 
estimates, thereby contributing to imprecision and a lack of 
transparency in overall BRAC estimated net savings figures.[Footnote 
27] Service officials have acknowledged that updating savings has not 
been a high priority and that instead, they have focused their 
resources on developing cost estimates for the annual budget 
submission. However, OSD BRAC and OSD Comptroller officials told us 
that they believe savings estimates should be updated based on evolving 
implementation plans. 

In addition, our analysis of DOD's fiscal year 2009 budget estimates 
for the 2005 BRAC round indicates that a majority of the expected 
savings are related to the implementation of a small percentage of 
recommendations. Specifically, we determined that the planned 
implementation of 24 recommendations (about 13 percent of all 2005 BRAC 
recommendations) accounts for about 80 percent, or nearly $3.2 billion, 
of the estimated net annual recurring savings. (See fig. 1.) A list of 
these recommendations can be found in appendix III. 

Figure 1: Small Percentage of BRAC Recommendations Generates Majority 
of Estimated Savings: 

This figure is a series of pie graphs showing small percentage of BRAC 
recommendations generates majority of estimated savings. 

[Refer to PDF for image] 

Source: GAO analysis based on DOD data. 

[End of figure] 

Since DOD promoted the latest round of BRAC partly on the premise that 
it would save money, we believe that imprecise savings estimates could 
diminish public trust in the BRAC process. Furthermore, without updated 
BRAC savings estimates, as required in DOD's own Financial Management 
Regulation, DOD decision makers and Congress may be left with an 
unrealistic sense of the savings this complex and costly BRAC round may 
actually produce, a situation that could be used to justify another 
round of BRAC in the future. 

Conclusions: 

Given the exceptional size, complexity, and cost of the 2005 BRAC 
round, the challenges to successfully implementing recommendations at 
over 800 locations--while simultaneously undergoing extensive force 
structure transformations--within the congressionally mandated 6-year 
implementation period are similarly unprecedented. Complete and timely 
information about the obstacles the services and defense agencies are 
facing and any possible mitigation measures for those recommendations 
that are at risk could enhance the management and oversight ability of 
the OSD BRAC office. Although OSD has recently asked the services and 
defense agencies to inform it of significant issues affecting 
implementation of BRAC recommendations by the statutory deadline, its 
November 2008 guidance does not specify a further schedule for 
briefings. Given the tight time frames for completing some 
recommendations and the complexity of the challenges some 
recommendations face, OSD may not have enough advance warning to 
effectively help the services and defense agencies overcome challenges 
that could threaten their ability to complete some of the hundreds of 
actions planned to take place within weeks of the congressionally 
mandated BRAC deadline. Furthermore, if the services and defense 
agencies provided OSD with information about possible measures that 
could be taken to mitigate those challenges on a regular and known 
schedule, OSD could more effectively reallocate resources, realign 
priorities, and coordinate joint solutions as warranted. 

Anticipated savings was an important consideration in justifying the 
need for the 2005 BRAC round. Before DOD can realize substantial 
savings from this large and complex BRAC round that it could redirect 
to other priorities, the department must first invest billions of 
dollars in facility construction, renovation, and other up-front 
expenses. As the cost of implementing BRAC 2005 recommendations 
increases, it is important for decision makers to maintain clear 
visibility over the evolving potential for savings as a result of the 
BRAC process. Updated savings estimates will add specificity to DOD's 
assessment of how much money will become available for other purposes 
and help avoid unnecessary appropriations from Congress. Moreover, 
without more precise savings estimates through the end of the current 
round's implementation period, Congress and DOD will lack an important 
perspective about BRAC results that could inform decisions about any 
future BRAC rounds. In addition, more precise estimates are important 
to preserving public confidence in the BRAC program. Finally, the 
periodic updating of savings estimates is a good financial management 
practice that could strengthen DOD's budgeting process by helping to 
ensure that the department relies on realistic assumptions in 
formulating its budgets. 

Recommendations for Executive Action: 

To enhance OSD's role in overseeing the implementation of BRAC 2005 
recommendations and managing challenges that could impact DOD's ability 
to achieve full BRAC implementation by the statutory deadline, we 
recommend that the Secretary of Defense direct the Under Secretary of 
Defense (Acquisition, Technology and Logistics) to modify the recently 
issued guidance on the status of BRAC implementation to: 

* establish a briefing schedule with briefings as frequently as OSD 
deems necessary to manage the risk that a particular recommendation may 
not meet the statutory deadline, but as a minimum, at 6-month 
intervals, through the rest of the BRAC 2005 implementation period, a 
schedule that would enable DOD to continually assess and respond to the 
challenges identified by the services and defense agencies that could 
preclude recommendation completion by September 15, 2011, and: 

* require the services and defense agencies to provide information on 
possible mitigation measures to reduce the effects of those challenges. 

To ensure that BRAC savings estimates are based on the best projection 
of what savings will actually accrue from approved realignments and 
closures, we recommend that the Secretary of Defense direct the Under 
Secretary of Defense (Acquisition, Technology and Logistics); the Under 
Secretary of Defense (Comptroller); and the military service 
secretaries to take steps to improve compliance with DOD's regulation 
requiring updated BRAC savings estimates. 

Agency Comments and Our Evaluation: 

In written comments on a draft of our report, DOD concurred with all 
three of our recommendations. DOD noted that BRAC business managers 
have and will continue to provide briefings on the status of 
implementation actions associated with recommendations exceeding $100 
million, and that these briefings provide a forum for BRAC business 
managers to explain their actions to mitigate challenges. In addition, 
DOD agreed that updating savings estimates on a regular basis is 
essential. The department stated that it is emphasizing savings updates 
during its briefings and in all future business plan approval 
documentation. DOD's written comments are reprinted in appendix V. DOD 
also provided technical comments, which we have incorporated into this 
report as appropriate. 

We are sending copies of this report to interested congressional 
committees; the Secretary of Defense; the secretaries of the Army, 
Navy, and Air Force; Commandant of the Marine Corps; and the Director, 
Office of Management and Budget. 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 concerning this report, please 
contact me on (202) 512-4523 or by e-mail at leporeb@gao.gov. Contact 
points for our Offices of Congressional Relations and Public Affairs 
are on the last page of this report. GAO staff who made major 
contributions to this report are listed in appendix VI. 

Signed by: 

Brian J. Lepore, Director: 

Defense Capabilities and Management: 

List of Congressional Committees: 

The Honorable Carl Levin: 
Chairman: 
The Honorable John McCain: 
Ranking Member: 
Committee on Armed Services: 
United States Senate: 

The Honorable Joseph Lieberman: 
Chairman: 
The Honorable Susan Collins: 
Ranking Member: 
Committee on Homeland Security and Governmental Affairs: 
United States Senate: 

The Honorable Daniel K. Inouye: 
Chairman: 
The Honorable Thad Cochran: 
Ranking Member: 
Subcommittee on Defense: 
Committee on Appropriations: 
United States Senate: 

The Honorable Tim Johnson: 
Chairman: 
The Honorable Kay Bailey Hutchison: 
Ranking Member: 
Subcommittee on Military Construction, Veterans Affairs, and Related 
Agencies: 
Committee on Appropriations: 
United States Senate: 

The Honorable Ike Skelton: 
Chairman: 
The Honorable John M. McHugh: 
Ranking Member: 
Committee on Armed Services: 
House of Representatives: 

The Honorable John P. Murtha, Jr.: 
Chairman: 
The Honorable C.W. Bill Young: 
Ranking Member: 
Subcommittee on Defense: 
Committee on Appropriations: 
House of Representatives: 

The Honorable Chet Edwards: 
Chairman: 
The Honorable Zach Wamp: 
Ranking Member: 
Subcommittee on Military Construction, Veterans Affairs, and Related 
Agencies: 
Committee on Appropriations: 
House of Representatives: 

[End of section] 

Appendix I: Scope and Methodology: 

We reviewed the Defense Base Closure and Realignment Commission's 182 
recommendations to realign and close military bases as presented in its 
September 2005 report to the President. We reviewed relevant 
documentation and interviewed officials in the Office of the Deputy 
Under Secretary of Defense (Installations and Environment) responsible 
for overseeing BRAC implementation and associated BRAC implementation 
offices in the Army, the Navy, and the Air Force. Given the 
unprecedented number of BRAC 2005 closures and realignments, we 
generally focused our analysis on those recommendations that DOD either 
expects to cost the most or save the most. 

To assess the challenges DOD faces that might affect the implementation 
of the BRAC recommendations by the statutory completion deadline of 
September 15, 2011, we reviewed relevant documentation including BRAC 
business plans, DOD presentations on BRAC implementation status, and 
prior GAO reports. We also interviewed officials in the Office of the 
Deputy Under Secretary of Defense (Installations and Environment) and 
associated BRAC offices, commands, and defense agencies that were 
implementing some of the complex or most costly BRAC realignments or 
closures to obtain the perspective of officials directly involved in 
BRAC implementation planning and execution. We also selected some of 
these installations or commands because they were responsible for 
implementing recommendations with a significant number of actions such 
as the completion of construction and movement of personnel expected to 
occur near the statutory deadline. At these locations, we discussed the 
specific challenges associated with implementing BRAC recommendations. 
In addition, we used DOD's annual report to Congress to identify 
estimated completion dates.[Footnote 28] Finally, we reviewed OSD's 
November 21, 2008, memo to the services and defense agencies 
responsible for implementing BRAC recommendations and assessed OSD's 
requirements for briefings on the status of BRAC implementation. 

To assess changes in DOD's reported cost and saving estimates since the 
fiscal year 2008 budget submission, we compared the fiscal year 2009 
BRAC budget submission to the fiscal year 2008 budget submission. We 
used DOD's BRAC budget submissions because these documents are the most 
authoritative information that is publicly available for comparing BRAC 
cost and savings estimates and because these submissions are the basis 
on which DOD seeks appropriations from the Congress. We then calculated 
dollar-amount differences for cost estimates and noted those 
recommendations that have increased the most in expected costs. To 
assess changes in DOD's estimate of net annual recurring savings, we 
used OSD's data provided to us for estimated savings in fiscal year 
2012--the year after OSD expects all recommendations to be completed-- 
because this data more fully captured these savings. We used OSD's data 
for fiscal year 2008 and fiscal year 2009 to make comparisons. In 
addition, to determine expected 20-year savings--also known as the 20- 
year net present value--we used the same formulas and assumptions as 
DOD and the BRAC Commission used to calculate these savings.[Footnote 
29] Specifically, we used DOD's BRAC fiscal year 2009 budget data for 
expected costs and savings to implement each recommendation for fiscal 
years 2006 through 2011. We also used data that the OSD BRAC office 
provided us for expected net annual recurring savings after the 
completion of each recommendation for fiscal years 2012 to 2025. We 
then converted these data to fiscal year constant 2005 dollars using 
DOD price indexes to distinguish real changes from changes because of 
inflation. We used fiscal year 2005 dollars to calculate 20-year 
savings because the BRAC Commission also used fiscal year 2005 dollars 
for this calculation. Applying the same formulas and assumptions as 
used by the BRAC Commission, we used a 2.8 percent discount rate to 
calculate the accumulated net present value of expected 20-year 
savings. 

To assess the reliability of DOD's BRAC cost and savings data, we 
tested computer-generated data for errors, reviewed relevant 
documentation, and discussed data quality control procedures with OSD 
BRAC officials. We determined that the data were sufficiently reliable 
for the purposes of making cost and savings comparisons for BRAC 
recommendations. We generally reported these estimated cost and savings 
in current dollars and not constant dollars except where noted. 

Finally, to evaluate the potential for BRAC cost and savings estimates 
to continue to change as the department proceeds with BRAC 
implementation, we interviewed officials from the Office of the Deputy 
Under Secretary of Defense (Installations and Environment), who are 
responsible for overseeing the implementation of BRAC recommendations 
and from associated BRAC implementation offices in the Army, Navy, and 
Air Force to discuss plans and procedures for updating these estimates. 
We also discussed plans and procedures for updating estimates with the 
Office of the Under Secretary of Defense (Comptroller). In addition, we 
discussed BRAC construction cost estimates with the U.S. Army Corps of 
Engineers because of its major role in planning and executing military 
construction projects. Further, we discussed cost and savings 
assumptions with officials from the military services responsible for 
implementing certain recommendations to better understand the potential 
for changes to cost and savings estimates. 

To obtain the perspective of installation and command officials 
directly involved in BRAC implementation planning and execution, we 
visited 12 installations, commands, or defense agencies affected by 
BRAC. We selected these installations and commands because they were 
among the closures or realignments that DOD projected to have 
significant costs or savings and to obtain a command-level perspective 
about BRAC implementation. Installations, commands, and defense 
agencies we visited are: 

* Army Forces Command, Fort McPherson, Georgia; 

* Army Special Operations Command, Fort Bragg, North Carolina; 

* Army Installation Management Command regions at Fort McPherson, 
Georgia; Fort Monroe, Virginia; and Fort Sam Houston, Texas; 

* Army Training and Doctrine Command, Fort Monroe, Virginia; 

* Garrison, Fort Belvoir, Virginia; 

* Garrison, Fort Bliss, Texas; 

* Garrison, Fort Sam Houston, Texas; 

* Air Force's Air Education and Training Command, Randolph Air Force 
Base, Texas; 

* Tri-Care Management Activity, Falls Church, Virginia; 

* National Geospatial-Intelligence Agency, Fort Belvoir, Virginia; 

* Naval Air Systems Command, Arlington, Virginia; and: 

* U.S. Army Corps of Engineers, Washington, D.C. 

Overall, we determined that the data for this report were sufficiently 
reliable for comparing cost and savings estimates and identifying broad 
implementation challenges. We conducted this performance audit from 
February 2008 to December 2008 in accordance with generally accepted 
government auditing standards. Those standards require that we plan and 
perform the audit to obtain sufficient, appropriate evidence to provide 
a reasonable basis for our findings and conclusions based on our audit 
objectives. We believe that the evidence obtained provides a reasonable 
basis for our findings and conclusions based on our audit objectives. 

[End of section] 

Appendix II: BRAC Recommendations DOD Expects to Cost the Most: 

Appendix II lists BRAC recommendations that the DOD expects to cost the 
most to implement based on its fiscal year 2009 budget submission to 
Congress. DOD expects 30 recommendations (16 percent of the 182 
recommendations) to generate about 72 percent of the one-time costs to 
implement BRAC recommendations during fiscal years 2006 through 
September 15, 2011, as shown in table 3. 

Table 3: BRAC Recommendations DOD Expects to Cost the Most to Implement 
(Fiscal Years 2006 through 2011): 

Current year dollars in millions. 

Realign Operational Army (Integrated Global Presence and Basing 
Strategy); 
One-time cost estimates: $3,029. 

Close National Geospatial-Intelligence Agency leased locations and 
realign others at Fort Belvoir, Va; 
One-time cost estimates: 2,441. 

Establish San Antonio Regional Medical Center and realign enlisted 
medical training to Fort Sam Houston, Tex; 
One-time cost estimates: 1,724. 

Realign Walter Reed Army Medical Center to Bethesda National Naval 
Medical Center, MD and to Fort Belvoir, Va; 
One-time cost estimates: 1,640[A]. 

Close Fort Monmouth, N.J; 
One-time cost estimates: 1,595. 

Realign Maneuver Training to Fort Benning, Ga; 
One-time cost estimates: 1,509. 

Realign to establish Combat Service Support Center at Fort Lee, Va; 
One-time cost estimates: 1,270. 

Co-locate miscellaneous OSD, defense agency, and field activity leased 
locations; 
One-time cost estimates: 1,194. 

Close Fort McPherson, Ga; 
One-time cost estimates: 798. 

Realign Fort Hood, Tex; 
One-time cost estimates: 670. 

Close Brooks City-Base, Tex; 
One-time cost estimates: 582. 

Consolidate Defense Information Systems Agency at Fort Meade, Md; 
One- time cost estimates: 578. 

Realign supply, storage, and distribution management; 
One-time cost estimates: 541. 

Reserve Component Transformation, Tex; 
One-time cost estimates: 486. 

Co-locate military department investigation agencies with DOD 
Counterintelligence and Security Agency at Marine Corps Base Quantico, 
Va; 
One-time cost estimates: 459. 

Relocate Army headquarters and field operating activities; 
One-time cost estimates: 444. 

Realign to create a Naval Integrated Weapons and Armaments Research, 
Development, and Acquisition, Test and Evaluation Center mostly at 
Naval Air Weapons Station China Lake, Calif; 
One-time cost estimates: 421. 

Consolidate depot level reparable procurement management; 
One-time cost estimates: 392. 

Co-locate missile and space defense agencies at Redstone Arsenal, Ala; 
One-time cost estimates: 352. 

Consolidate/co-locate active and reserve personnel and recruiting 
centers for Army and Air Force; 
One-time cost estimates: 344. 

Realign Fort Bragg, N.C; 
One-time cost estimates: 327. 

Close Naval Air Station Brunswick, Maine; 
One-time cost estimates: 300. 

Close Naval Air Station Willow Grove, Pa., and realign Cambria Regional 
Airport, Johnstown, Pa; 
One-time cost estimates: 295. 

Realign to relocate Air Defense Artillery Center and School at Fort 
Sill, Okla; 
One-time cost estimates: 294. 

Consolidate Defense Finance and Accounting Service; 
One-time cost estimates: 290. 

Close Fort Monroe, Va; 
One-time cost estimates: 286. 

Reserve Component Transformation, Okla; 
One-time cost estimates: 254. 

Consolidate correctional facilities into joint regional correctional 
facilities; 
One-time cost estimates: 251. 

Realign defense research service-led laboratories at multiple 
locations; 
One-time cost estimates: 244. 

Realign Naval Support Activity New Orleans, La; 
One-time cost estimates: 238. 

Total one-time estimated costs from the recommendations listed above; 
One-time cost estimates: $23,246. 

Total one-time estimated costs from all recommendations; 
One-time cost estimates: $32,433. 

Percentage of one-time costs from recommendations listed above of all 
recommendations; 
One-time cost estimates: 72%. 

Source: GAO analysis based on DOD data. 

Note: Totals may not add because of rounding. 

[A] This amount does not include an additional $416 million already 
received and an anticipated $263 million not yet received to accelerate 
and enhance the realignment of Walter Reed Army Medical Center to 
Bethesda National Naval Medical Center, Maryland, and to Fort Belvoir, 
Virginia. 

[End of table] 

[End of section] 

Appendix III: BRAC Recommendations DOD Expects to Save the Most 
Annually: 

Appendix III lists individual BRAC recommendations that DOD expects to 
save the most annually after it has implemented the recommendations 
based on its fiscal year 2009 budget submission. DOD expects 24 
recommendations (13 percent of the 182 recommendations) to generate 
more than 80 percent of the net annual recurring savings as shown in 
table 4. 

Table 4: BRAC Recommendations DOD Expects to Save the Most Annually 
after Implementation (Projected for Fiscal Year 2012): 

Current year dollars in millions. 

Realign to establish fleet readiness centers; 
Net annual recurring savings[A]: $304. 

Consolidate Defense Finance and Accounting Service; 
Net annual recurring savings[A]: 283. 

Realign Cannon Air Force Base, N.M.[B]; 
Net annual recurring savings[A]: 260. 

Realign Pope Air Force Base, N.C; 
Net annual recurring savings[A]: 213. 

Realign Walter Reed Army Medical Center to Bethesda National Naval 
Medical Center, Md. and to Fort Belvoir, Va; 
Net annual recurring savings[A]: 172. 

Consolidate/co-locate active and reserve personnel and recruiting 
centers for Army and Air Force; 
Net annual recurring savings[A]: 170. 

Consolidate depot level reparable procurement management consolidation; 
Net annual recurring savings[A]: 156. 

Close Fort Monmouth, N.J; 
Net annual recurring savings[A]: 154. 

Realign supply, storage, and distribution management; 
Net annual recurring savings[A]: 152. 

Establish San Antonio Regional Medical Center and realign enlisted 
medical training to Fort Sam Houston, Tex; 
Net annual recurring savings[A]: 149. 

Realign to establish Combat Service Support Center at Fort Lee, Va; 
Net annual recurring savings[A]: 148. 

Realign Maneuver Training to Fort Benning, Ga; 
Net annual recurring savings[A]: 133. 

Close Naval Air Station Brunswick, Maine; 
Net annual recurring savings[A]: 99. 

Consolidate Transportation Command components at Scott Air Force Base, 
Ill; 
Net annual recurring savings[A]: 97. 

Close Fort McPherson, Ga; 
Net annual recurring savings[A]: 94. 

Close Brooks City-Base, Tex; 
Net annual recurring savings[A]: 92. 

Realign by converting medical inpatient services to clinics at various 
installations; 
Net annual recurring savings[A]: 91. 

Co-locate miscellaneous OSD, defense agencies, and field activity 
leases at Fort Belvoir, Va; 
Net annual recurring savings[A]: 72. 

Close Naval Station Ingleside, Tex. and realign Naval Air Station 
Corpus Christi, Tex; 
Net annual recurring savings[A]: 69. 

Realign to create a Naval Integrated Weapons and Armaments Research, 
Development, and Acquisition, Test and Evaluation Center mostly at 
Naval Air Weapons Station China Lake, Calif; 
Net annual recurring savings[A]: 68. 

Relocate medical command headquarters; 
Net annual recurring savings[A]: 67. 

Close Fort Monroe, Va; 
Net annual recurring savings[A]: 65. 

Close National Geospatial-Intelligence Agency leased locations and 
realign others at Fort Belvoir, Va; 
Net annual recurring savings[A]: 57. 

Consolidate Defense Information Systems Agency at Fort Meade, Md; 
Net annual recurring savings[A]: 52. 

Total net annual recurring savings from the recommendations listed 
above; 
Net annual recurring savings[A]: $3,216. 

Total net annual recurring savings from all recommendations; 
Net annual recurring savings[A]: $4,001. 

Percentage of net annual recurring savings from recommendations listed 
above of all recommendations; 
Net annual recurring savings[A]: 80%. 

Source: GAO analysis based on DOD data. 

Note: Totals may not add because of rounding. 

[A] Data provided by DOD for fiscal year 2012 expected savings. 

[B] In May 2005, DOD proposed closing Cannon AFB, New Mexico. In 
September 2005, the BRAC Commission stated that Cannon could remain 
open if DOD identified a new mission for the base. Subsequently, the 
Air Force announced in June 2006 that Cannon will remain open because 
it plans to activate a new mission at the base. The Air Force BRAC 
Office said it claimed these savings because the decision to reallocate 
Air Force resources and mission to Cannon was made after the BRAC 
recommendation was approved and was therefore, a non-BRAC programmatic 
decision. 

[End of table] 

[End of section] 

Appendix IV: BRAC Recommendations DOD Expects to Save the Most over a 
20-year Period: 

Appendix IV lists individual BRAC recommendations that DOD expects to 
save the most over a 20-year period. DOD expects 30 recommendations (16 
percent) to generate more than 85 percent of the 20-year savings as 
shown in table 5. 

Table 5: BRAC Recommendations DOD Expects to Save the Most Over a 20- 
year Period (Fiscal Years 2006 through 2025): 

Constant fiscal year 2005 dollars in millions. 

Realign to establish fleet readiness centers; 
20-year net present value[A]: $3,371. 

Realign Cannon Air Force Base, N.M.[B]; 
20-year net present value[A]: 2,838. 

Consolidate Defense Finance and Accounting Service; 
20-year net present value[A]: 2,766. 

Realign Pope Air Force Base, N.C; 
20-year net present value[A]: 2,379. 

Consolidate/co-locate active and reserve personnel and recruiting 
centers for Army and Air Force; 
20-year net present value[A]: 1,463. 

Consolidate depot level reparable procurement management; 
20-year net present value[A]: 1,350. 

Realign supply, storage, and distribution management; 
20-year net present value[A]: 1,175. 

Consolidate Transportation Command components at Scott Air Force Base, 
Ill; 
20-year net present value[A]: 941. 

Realign by converting medical inpatient services to clinics at various 
installations; 
20-year net present value[A]: 850. 

Close Naval Air Station Brunswick, Maine; 
20-year net present value[A]: 717. 

Relocate medical command headquarters; 
20-year net present value[A]: 671. 

Close Naval Station Ingleside, Tex. and realign Naval Air Station 
Corpus Christi, Tex; 
20-year net present value[A]: 490. 

Close Naval Station Pascagoula, Miss; 
20-year net present value[A]: 463. 

Close Brooks City-Base, Tex; 
20-year net present value[A]: 427. 

Close Naval Air Station Atlanta, Ga; 
20-year net present value[A]: 364. 

Realign to establish Combat Service Support Center at Fort Lee, Va; 
20-year net present value[A]: 348. 

Close Fort Monroe, Va; 
20-year net present value[A]: 318. 

Realign to consolidate maritime command, control, communications, 
computers, intelligence, surveillance, and reconnaissance, research, 
development, and acquisition, test and evaluation functions at multiple 
locations; 
20-year net present value[A]: 296. 

Realign to create a Naval Integrated Weapons and Armaments Research, 
Development, and Acquisition, Test and Evaluation Center mostly at 
Naval Air Weapons Station China Lake, Calif; 
20-year net present value[A]: 290. 

Close Fort Gillem, Ga; 
20-year net present value[A]: 288. 

Realign Walter Reed Army Medical Center to Bethesda National Naval 
Medical Center, Md., and to Fort Belvoir, Va; 
20-year net present value[A]: 287. 

Co-locate miscellaneous Army leased locations; 
20-year net present value[A]: 277. 

Establish joint bases at multiple locations; 
20-year net present value[A]: 273. 

Close Fort Monmouth, N.J; 
20-year net present value[A]: 269. 

Realign Army Reserve Command and Control - Northeast; 
20-year net present value[A]: 262. 

Realign Mountain Home Air Force Base, Idaho; 
20-year net present value[A]: 259. 

Close Fort McPherson, Ga; 
20-year net present value[A]: 257. 

Realign commodity management privatization; 
20-year net present value[A]: 248. 

Realign defense research service-led laboratories at multiple 
locations; 
20-year net present value[A]: 235. 

Close U.S. Army Garrison Michigan at Selfridge; 
20-year net present value[A]: 215. 

Total savings from the recommendations listed above; 
20-year net present value[A]: $24,388. 

Total savings from only recommendations that accrue a net savings after 
20 years; 
20-year net present value[A]: $28,640. 

Percentage of savings from recommendations listed above of all 
recommendations that accrue a net savings after 20 years; 
20-year net present value[A]: 85%. 

Source: GAO analysis based on DOD data. 

Note: Totals may not add because of rounding. 

[A] Net present value: A financial calculation that takes the time 
value of money into account by determining the present value of the up- 
front initial investment minus future net savings over a specific 
period of time. In the context of BRAC, net present value is the total 
one-time costs minus the total net savings that DOD expects to incur 
from fiscal year 2006 through fiscal year 2025 to project 20-year 
savings at a 2.8 percent discount rate. 

[B] In May 2005, DOD proposed closing Cannon AFB, New Mexico. In 
September 2005, the BRAC Commission stated that Cannon could remain 
open if DOD identified a new mission for the base. Subsequently, the 
Air Force announced in June 2006 that Cannon will remain open because 
it plans to activate a new mission at the base. The Air Force BRAC 
Office said it claimed these savings because the decision to reallocate 
Air Force resources and mission to Cannon was made after the BRAC 
recommendation was approved and was therefore, a non-BRAC programmatic 
decision. 

[End of table] 

[End of section] 

Appendix V: Comments from the Department of Defense: 

Office Of The Under Secretary Of Defense: 
3000 Defense Pentagon: 
Washington, DC 20301-3000: 

Acquisition Technology And Logistics: 

January 14, 2009: 

Mr. Brian Lepore: 
Director, Defense Capabilities and Management: 
U.S. Government Accountability Office: 
441 G Street, N.W.: 
Washington, DC 20548: 

Dear Mr. Lepore: 

This is the Department of Defense (DoD) response to the GAO draft 
report, "Military Base Realignments And Closures: DoD Faces Challenges 
in Implementing Recommendations on Time and is Not Consistently 
Updating Savings Estimates," dated December 18, 2008 (GAO Code 
351170)/GAO-09-217). 

The Department appreciates the opportunity to comment on this draft 
report and concurs with the GAO's recommendations concerning program 
execution update briefings to the OSD staff by the business plan 
managers and the updating of savings estimates. Detailed comments on 
the report recommendations are enclosed. 

Even though the BRAC 2005 round is costing more and savings less than 
originally estimated in 2005, implementation of these recommendations 
are expected to enhance defense operations and management as the 
Department reshapes and realigns forces to meet future national 
security needs. The report accurately characterizes the Department's 
viewpoint that this BRAC round is transforming DoD by aligning the 
infrastructure with the defense strategy, fostering jointness across 
the Department, and reducing excess infrastructure and producing 
savings. The Department appreciates the fact that this report 
acknowledges that the Department has made steady progress thus far in 
implementing these recommendations. 

The Department recognizes the unique challenges associated with 
implementing the more complex recommendations and the synchronization 
efforts required to manage the interdependencies among many 
recommendations. To apprise senior leadership of problems requiring 
intervention as early as possible, the Department institutionalized an 
implementation execution update briefing program in November, which 
this report acknowledges as a positive step in oversight. These update 
briefings, representing 86 percent of the investment value of all 
recommendations, provided an excellent forum for business plan managers 
to explain their actions underway to mitigate the impacts of problem 
issues. The business managers have and will continue to brief the 
status of implementation actions associated with recommendations which 
exceed $100M on a continuing basis through statutory completion of all 
recommendations (September 15, 2011). The business managers are also 
required to brief other plans for which they have concerns. 

The Department considers the updating of savings estimates on a regular 
basis to be essential. While sufficient guidance already exists in the 
financial management regulation, additional emphasis on this effort is 
being provided during all program execution update discussions and in 
all future business plan update approval documentation. 

We continue to appreciate audit work performed by the GAO. 

Sincerely, 

Signed by: 

Wayne Arny
Deputy Under Secretary of Defense: 
(Installations and Environment): 

Enclosure: 
As stated: 

GAO Draft Report – Dated December 18, 2008 GAO Code 351170/GAO-09-217:  

"Military Base Realignments And Closures: DoD Faces Challenges in 
Implementing Recommendations on Time and is Not Consistently Updating 
Savings Estimates" 

Department Of Defense Comments To The Recommendations: 

Recommendation 1: The GAO recommends that the Secretary of Defense 
direct the Under Secretary of Defense for Acquisition, Technology and 
Logistics modify its recently issued guidance on the status of the base 
realignment and closure (BRAC) implementation to establish a briefing 
schedule with briefings as frequently as the Office of the Secretary of 
Defense deems necessary to manage the risk that a particular 
recommendation may not meet the statutory deadline, but as a minimum, 
at six-month intervals, through the rest of the BRAC 2005 
implementation period, which would enable DoD to continually assess and 
respond to the challenges identified by the Services and Defense 
Agencies that could preclude recommendation completion by September 15, 
2011. 

DOD Response: Concur. The implementation execution update briefing 
program the Department institutionalized in November 2008 provided an 
excellent forum for business plan managers to explain their actions 
underway to mitigate the impacts of problem issues. The business 
managers will regularly brief the status of implementation actions 
associated with recommendations which exceed $100M on a continuing 
basis through statutory completion of all recommendations (September 
15, 2011). The business managers are also required to brief other plans 
for which they have concerns. These briefings are occurring more 
frequently than the six-month intervals recommended in this report. 

Recommendation 2: The GAO recommends that the Secretary of Defense 
direct the Under Secretary of Defense for Acquisition, Technology and 
Logistics to require the Services and Defense Agencies to provide 
information on possible mitigation measures to reduce the effects of 
those challenges. 

DOD Response: Concur. The implementation execution update briefing 
program the Department institutionalized in November 2008 provided an 
excellent forum for business plan managers to explain their actions 
underway to mitigate the impacts of problem issues. Mitigation efforts 
are being provided during all briefings and these efforts are planned 
for further discussion within the next 60 days. The business managers 
will brief the status of implementation actions associated with 
recommendations which exceed $100M on a continuing basis through 
statutory completion of all recommendations (September 15, 2011). The 
business managers are also required to brief other plans for which they 
have concerns. 

Recommendation 3: The GAO recommends that the Secretary of Defense 
direct the Under Secretary of Defense for Acquisition, Technology and 
Logistics, the Under Secretary of Defense (Comptroller), and the 
Service secretaries to take steps to improve compliance with DoD's 
regulation requiring updated base realignment and closure savings 
estimates. 

DOD Response: Concur. The Department considers the updating of savings 
estimates on a regular basis to be essential. While sufficient guidance 
already exists in the financial management regulation, additional 
emphasis on this effort is being provided during all program execution 
update discussions and in all future business plan update approval 
documentation.

[End of section] 

Appendix VI: GAO Contact and Staff Acknowledgments: 

GAO Contact: 

Brian J. Lepore, (202) 512-4523 or leporeb@gao.gov: 

Acknowledgments: 

In addition to the individual named above, Laura Talbott, Assistant 
Director; Vijay Barnabas; John Beauchamp; Susan Ditto; Gregory 
Marchand; Richard Meeks; and Charles Perdue made key contributions to 
this report. 

[End of section] 

Related GAO Products: 

Military Base Realignments and Closures: Army Is Developing Plans to 
Transfer Functions from Fort Monmouth, New Jersey, to Aberdeen Proving 
Ground, Maryland, but Challenges Remain. [hyperlink, 
http://www.gao.gov/products/GAO-08-1010R]. Washington, D.C.: August 13, 
2008. 

Defense Infrastructure: High-Level Leadership Needed to Help 
Communities Address Challenges Caused by DOD-Related Growth. 
[hyperlink, http://www.gao.gov/products/GAO-08-665]. Washington, D.C.: 
June 17, 2008. 

Defense Infrastructure: DOD Funding for Infrastructure and Road 
Improvements Surrounding Growth Installations. [hyperlink, 
http://www.gao.gov/products/GAO-08-602R]. Washington, D.C.: April 1, 
2008. 

Defense Infrastructure: Army and Marine Corps Grow the Force 
Construction Projects Generally Support the Initiative. [hyperlink, 
http://www.gao.gov/products/GAO-08-375]. Washington, D.C.: March 6, 
2008. 

Military Base Realignments and Closures: Higher Costs and Lower Savings 
Projected for Implementing Two Key Supply-Related BRAC Recommendations. 
[hyperlink, http://www.gao.gov/products/GAO-08-315]. Washington, D.C.: 
March 5, 2008. 

Defense Infrastructure: Realignment of Air Force Special Operations 
Command Units to Cannon Air Force Base, New Mexico. [hyperlink, 
http://www.gao.gov/products/GAO-08-244R]. Washington, D.C.: January 18, 
2008. 

Military Base Realignments and Closures: Estimated Costs Have Increased 
and Estimated Savings Have Decreased. [hyperlink, 
http://www.gao.gov/products/GAO-08-341T]. Washington, D.C.: December 
12, 2007. 

Military Base Realignments and Closures: Cost Estimates Have Increased 
and Are Likely to Continue to Evolve. [hyperlink, 
http://www.gao.gov/products/GAO-08-159]. Washington, D.C.: December 11, 
2007. 

Military Base Realignments and Closures: Impact of Terminating, 
Relocating, or Outsourcing the Services of the Armed Forces Institute 
of Pathology. [hyperlink, http://www.gao.gov/products/GAO-08-20]. 
Washington, D.C.: November 9, 2007. 

Military Base Realignments and Closures: Transfer of Supply, Storage, 
and Distribution Functions from Military Services to Defense Logistics 
Agency. [hyperlink, http://www.gao.gov/products/GAO-08-121R]. 
Washington, D.C.: October 26, 2007. 

Defense Infrastructure: Challenges Increase Risks for Providing Timely 
Infrastructure Support for Army Installations Expecting Substantial 
Personnel Growth. [hyperlink, http://www.gao.gov/products/GAO-07-1007]. 
Washington, D.C.: September 13, 2007. 

Military Base Realignments and Closures: Plan Needed to Monitor 
Challenges for Completing More Than 100 Armed Forces Reserve Centers. 
[hyperlink, http://www.gao.gov/products/GAO-07-1040]. Washington, D.C.: 
September 13, 2007. 

Military Base Realignments and Closures: Observations Related to the 
2005 Round. [hyperlink, http://www.gao.gov/products/GAO-07-1203R]. 
Washington, D.C.: September 6, 2007. 

Military Base Closures: Projected Savings from Fleet Readiness Centers 
Are Likely Overstated and Actions Needed to Track Actual Savings and 
Overcome Certain Challenges. [hyperlink, 
http://www.gao.gov/products/GAO-07-304]. Washington, D.C.: June 29, 
2007. 

Military Base Closures: Management Strategy Needed to Mitigate 
Challenges and Improve Communication to Help Ensure Timely 
Implementation of Air National Guard Recommendations. [hyperlink, 
http://www.gao.gov/products/GAO-07-641]. Washington, D.C.: May 16, 
2007. 

Military Base Closures: Opportunities Exist to Improve Environmental 
Cleanup Cost Reporting and to Expedite Transfer of Unneeded Property. 
[hyperlink, http://www.gao.gov/products/GAO-07-166]. Washington, D.C.: 
January 30, 2007. 

Military Bases: Observations on DOD's 2005 Base Realignment and Closure 
Selection Process and Recommendations. [hyperlink, 
http://www.gao.gov/products/GAO-05-905]. Washington, D.C.: July 18, 
2005. 

Military Bases: Analysis of DOD's 2005 Selection Process and 
Recommendations for Base Closures and Realignments. [hyperlink, 
http://www.gao.gov/products/GAO-05-785]. Washington, D.C.: July 1, 
2005. 

[End of section] 

Footnotes: 

[1] This dollar amount is based on DOD's fiscal year 2009 budget 
submission to Congress to pay for continuing implementation of 
recommendations from prior BRAC rounds (BRAC 1988, 1991, 1993, and 
1995). This amount does not include other BRAC associated costs such as 
costs to complete environmental cleanup at BRAC bases in future years 
and costs incurred by other DOD and federal agencies to provide 
assistance to communities and individuals impacted by BRAC. DOD's 
budget submission is reported in current dollars (i.e., includes 
projected inflation). 

[2] The relocation of about 15,000 U.S. military personnel from various 
overseas locations to the United States is included in the BRAC 2005 
recommendations. DOD plans to relocate the remaining military personnel 
in realignment actions not related to BRAC. 

[3] The Army is planning to increase its active-duty end strength by 
65,000, and the Marine Corps is planning to increase its active-duty 
end strength by 27,000 over the next several years. 

[4] BRAC legislation (Pub. L. No. 101-510, Title XXIX (1990), as 
amended by Pub. L. No. 107-107, Title XXX (2001)) provided for an 
independent commission to review the Secretary of Defense's realignment 
and closure recommendations and the commission had the authority to 
change these recommendations if it determined that the Secretary 
deviated substantially from the legally mandated selection criteria. 
The Defense Base Closure and Realignment Commission (referred to in 
this report as the BRAC Commission) presented its list of final 
recommendations to the President of the United States, who approved 
them in their entirety. The President subsequently forwarded these BRAC 
recommendations to Congress, and they became effective on November 9, 
2005. 

[5] Military value refers to one or more BRAC selection criteria, which 
includes such considerations as an installation's current and future 
mission capabilities, condition, ability to accommodate future needs, 
and cost of operations. Military value was a priority consideration in 
prior BRAC rounds, along with costs and savings, economic impact on 
communities, and other concerns. DOD adopted similar criteria, 
establishing military value as a priority consideration for the 2005 
BRAC round and cost and savings as a secondary consideration, which 
Congress subsequently enacted into law in the Ronald Reagan National 
Defense Authorization Act for Fiscal Year 2005, Pub. L. No. 108-375, § 
2832 (2004) (amending Pub. L. No. 101-510, § 2913 (1990)). 

[6] The BRAC Commission reported its estimate in constant fiscal year 
2005 dollars (i.e., excludes projected inflation). 

[7] Pub. L. No. 110-181 (2008). 

[8] H.R. Rep. No. 110-146, at 514 (May 11, 2007). 

[9] As we have previously reported, we believe DOD's net annual 
recurring savings estimates may be overstated because they include 
savings from eliminating military personnel positions without 
corresponding decreases in end-strength. DOD disagrees with our 
position. The $4 billion estimate is calculated using DOD's method, 
which we nonetheless believe overstates savings. However, we included 
these estimates for consistency. 

[10] The 20-year savings estimates, also known as the 20-year net 
present value, are in constant fiscal year 2005 dollars (i.e., excludes 
projected inflation), to be consistent with the BRAC Commission's 
methodology and reporting of this estimate. 

[11] DOD Financial Management Regulation, 7000.14R, vol. 2B, ch. 7, 
Base Realignment and Closure Appropriations, paragraph 070303E (Sept. 
2008). 

[12] The first round in 1988 was authorized by the Defense 
Authorization Amendments and Base Closure and Realignment Act, Pub. L. 
No. 100-526, Title II (1988) (as amended). Subsequently, additional 
BRAC rounds were completed in 1991, 1993, and 1995 as authorized by the 
Defense Base Closure and Realignment Act of 1990, Pub. L. No. 101-510, 
Title XXIX (1990) (as amended). The latest round--BRAC 2005--was 
authorized by the National Defense Authorization Act for Fiscal Year 
2002, Pub. L. No. 107-107, Title XXX (2001). 

[13] DOD defines major closures as installations recommended for 
closure with plant replacement value exceeding $100 million and major 
realignments as installations losing more than 400 military and 
civilian personnel. Minor closures and realignments are those closures 
and realignments that do not meet the definitions above. 

[14] In the context of BRAC, net present value savings take into 
account the time value of money in calculating the value of future 
costs and savings. For fiscal year 2005, DOD used a 2.8 percent 
discount rate to calculate net present value. To be consistent, we used 
the same rate in our calculations. 

[15] DOD, Report on 2005 Defense Base Closure and Realignment 
Implementation, Volume I, (June 2008). 

[16] DOD was directed to expand its consideration of other possible 
sites in the National Defense Authorization Act for Fiscal Year 2008. 

[17] The BRAC recommendation called for moving 1,352 personnel to 
Eglin, but the Army has added approximately 900 personnel to this move 
as a non-BRAC action. 

[18] GAO, Military Base Realignments and Closures: Plan Needed to 
Monitor Challenges for Completing More than 100 Armed Forces Reserve 
Centers, [hyperlink, http://www.gao.gov/products/GAO-07-1040] 
(Washington, D.C.: Sept. 13, 2007). 

[19] GAO, Military Base Realignments and Closures: Army Is Developing 
Plans to Transfer Functions from Fort Monmouth, New Jersey, to Aberdeen 
Proving Ground, Maryland, but Challenges Remain, [hyperlink, 
http://www.gao.gov/products/GAO-08-1010R] (Washington, D.C.: Aug. 13, 
2008). 

[20] GAO, Hurricane Katrina: GAO's Preliminary Observations Regarding 
Preparedness, Response, and Recover, [hyperlink, 
http://www.gao.gov/products/GAO-06-442T] (Washington, D.C.: Mar. 8, 
2006) and GAO, Defense Management: Additional Actions Needed to Enhance 
DOD's Risk-Based Approach for Making Resource Decisions, [hyperlink, 
http://www.gao.gov/products/GAO-06-13] (Washington, D.C.: Nov. 15, 
2005). 

[21] Net annual recurring savings comparisons are based on OSD 
projections for fiscal year 2012 and beyond. 

[22] As we have previously reported, we and the BRAC Commission believe 
that DOD's net annual recurring savings estimates may be overstated 
because they include savings from eliminating military personnel 
positions without corresponding decreases in end-strength. DOD 
disagrees with our position. Savings for eliminating military personnel 
positions as defined by DOD's approach account for about $1.85 billion-
-46 percent of total current estimated recurring savings of $4 billion. 

[23] Twenty-year savings, also known as 20-year net present value in 
the BRAC Commission's report, is a financial calculation that accounted 
for the time value of money by determining the present value of future 
savings minus up-front investment costs over a specific period of time. 
Determining net present value is important because it illustrates both 
the up-front investment costs and long-term savings in a single amount. 
In the context of BRAC implementation, net present value is calculated 
for a 20-year period from 2006 through 2025. 

[24] We included the savings from military personnel eliminations in 
our report for ease of comparison. 

[25] GAO, Military Base Realignments and Closures: Cost Estimates Have 
Increased and Are Likely to Continue to Evolve, [hyperlink, 
http://www.gao.gov/products/GAO-08-159] (Washington, D.C.: Dec.11, 
2007). 

[26] DOD Financial Management Regulation, 7000.14R, vol. 2B, ch. 7, 
Base Realignment and Closure Appropriations, para. 070303E (Sept. 
2008). 

[27] GAO, Military Base Closures: Updated Status of Prior Base 
Realignments and Closures, [hyperlink, http://www.gao.gov/products/GAO-
05-138] (Washington, D.C.: Jan. 13, 2005). 

[28] DOD, Report on 2005 Defense Base Closure and Realignment 
Implementation, Volume I, (June 2008). 

[29] DOD reported 20-year savings estimates for each base closure and 
realignment recommendation in its report to the BRAC Commission. 
Subsequently, the BRAC Commission also reported 20-year savings 
estimates for each BRAC recommendation in its report to the President. 
OSD BRAC officials told us that DOD does not include 20-year savings 
estimates in its BRAC budgets to Congress because this information is 
not required. Consequently, we calculated 20-year savings for 
comparison purposes in a manner consistent with the BRAC Commission's 
calculation of these savings. 

GAO's Mission: 

The Government Accountability Office, the audit, evaluation and 
investigative arm of Congress, exists to support Congress in meeting 
its constitutional responsibilities and to help improve the performance 
and accountability of the federal government for the American people. 
GAO examines the use of public funds; evaluates federal programs and 
policies; and provides analyses, recommendations, and other assistance 
to help Congress make informed oversight, policy, and funding 
decisions. GAO's commitment to good government is reflected in its core 
values of accountability, integrity, and reliability. 

Obtaining Copies of GAO Reports and Testimony: 

The fastest and easiest way to obtain copies of GAO documents at no 
cost is through GAO's Web site [hyperlink, http://www.gao.gov]. Each 
weekday, GAO posts newly released reports, testimony, and 
correspondence on its Web site. To have GAO e-mail you a list of newly 
posted products every afternoon, go to [hyperlink, http://www.gao.gov] 
and select "E-mail Updates." 

Order by Phone: 

The price of each GAO publication reflects GAO’s actual cost of
production and distribution and depends on the number of pages in the
publication and whether the publication is printed in color or black and
white. Pricing and ordering information is posted on GAO’s Web site, 
[hyperlink, http://www.gao.gov/ordering.htm]. 

Place orders by calling (202) 512-6000, toll free (866) 801-7077, or
TDD (202) 512-2537. 

Orders may be paid for using American Express, Discover Card,
MasterCard, Visa, check, or money order. Call for additional 
information. 

To Report Fraud, Waste, and Abuse in Federal Programs: 

Contact: 

Web site: [hyperlink, http://www.gao.gov/fraudnet/fraudnet.htm]: 
E-mail: fraudnet@gao.gov: 
Automated answering system: (800) 424-5454 or (202) 512-7470: 

Congressional Relations: 

Ralph Dawn, Managing Director, dawnr@gao.gov: 
(202) 512-4400: 
U.S. Government Accountability Office: 
441 G Street NW, Room 7125: 
Washington, D.C. 20548: 

Public Affairs: 

Chuck Young, Managing Director, youngc1@gao.gov: 
(202) 512-4800: 
U.S. Government Accountability Office: 
441 G Street NW, Room 7149: 
Washington, D.C. 20548: