Army Housing:

Overcharges and Inefficient Use of On-Base Lodging Divert Training Funds

NSIAD-90-241: Published: Sep 28, 1990. Publicly Released: Oct 29, 1990.

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Pursuant to a congressional request, GAO evaluated the diversion of Army training funds due to overcharges and inefficient use of on-base lodging.

GAO found that: (1) some Army installations overcharged official travellers and their home commands millions of dollars for transient lodging and used the excess charges to subsidize other Morale, Welfare, and Recreation (MWR) Fund programs and to provide questionable amenities to distinguished visitors' quarters (DVQ); (2) contrary to congressional committee guidance, the Army combined transient lodging funds with nonappropriated funds from other MWR activities in a single fund; (3) the Army and the Department of Defense (DOD) failed to effectively evaluate or monitor lodging operations to ensure that lodging costs were kept to the minimum needed for authorized operation and minor improvements; (4) since 1985, the Army Forces Command and the Army Training and Doctrine Command have realized an estimated $70 million from inflated transient lodging charges; (5) the Army granted transient personnel more costly off-base per diem when on-base lodging was available; (6) the Army reservation system fostered inefficient use of transient quarters; (7) inefficient use of DVQ increased per diem costs; (8) use of transient quarters by transferred Army personnel resulted in temporary duty travellers being denied rooms, at a cost of $30,600; (9) inefficient management of Army barracks led to unnecessary off-base per diem; and (10) the Army Audit Agency identified, as widespread problems, overcharges for transient lodging and payments for off-base lodging when transient quarters were available as widespread problems.

Recommendations for Executive Action

  1. Status: Closed - Not Implemented

    Comments: The Army has completed a review of its transient lodging overcharges. DOD did not agree with the recommendation to return overcharges to the U.S. Treasury or to the originating appropriation. It believes that there are substantive mitigating factors (O&M budget reductions and investment in capital projects for guest houses) that serve to offset the rationale for repayment. This recommendation should be closed in view of GAO's follow-up report (NSIAD-93-188), which updated the amount of overcharges and recommended that Congress direct the Army to reimburse the Treasury for overpayments.

    Recommendation: The Secretary of the Army should review the MWR accounts of the major Army commands to: (1) identify accumulated overpayments for transient lodging; (2) recognize each overpayment as a liability to the appropriation account initially charged or its successor; (3) charge the overpayment to the general fund of the U.S. Treasury as a miscellaneous receipt if the appropriation account cannot be identified; and (4) develop and implement a repayment plan.

    Agency Affected: Department of Defense: Department of the Army

  2. Status: Closed - Implemented

    Comments: Army Regulation 210-11 was included in a new consolidated housing management regulation, A.R. 210-50, issued in April 1990. The new regulation stipulates that funds generated through service charges will be used only to support transient lodging facilities.

    Recommendation: The Secretary of the Army should revise Army Regulations 210-11, 215-1, and 215-5 to stipulate that transient lodging funds must be applied only to transient facilities, as required by DOD directives.

    Agency Affected: Department of Defense: Department of the Army

  3. Status: Closed - Implemented

    Comments: The Army has directed its major commands, in a June 1991 message, to separate transient housing from MWR funds. Effective October 1, 1991, a separate fund was established at each Army installation.

    Recommendation: The Secretary of the Army should exclude transient lodging funds from the Army's single fund.

    Agency Affected: Department of Defense: Department of the Army

  4. Status: Closed - Implemented

    Comments: The Army implemented a Transient Housing Service Charge Monitoring Program in March 1991, which required "look-back" reports to October 1990. All Army installations which operate transient housing are being monitored.

    Recommendation: The Secretary of the Army should establish controls to monitor Army installations' compliance with DOD and Army regulations that stipulate that lodging charges should not exceed the minimum amount needed to meet authorized costs and planned improvements.

    Agency Affected: Department of Defense: Department of the Army

  5. Status: Closed - Implemented

    Comments: The Assistant Chief of Engineers provided specific guidance to the field on October 9, 1990 concerning the appropriate type, quality, and cost for the acquisition of transient housing furnishings.

    Recommendation: The Secretary of the Army should provide more specific guidance to commanders on the types and quality of furnishings appropriate for transient quarters.

    Agency Affected: Department of Defense: Department of the Army

  6. Status: Closed - Implemented

    Comments: DOD stated that it has developed a program evaluation and monitoring system to ensure the military services' compliance with transient lodging regulations. DOD has issued a revised DOD directive requiring the services to submit financial reports to the Office of the Secretary of Defense.

    Recommendation: The Secretary of Defense should establish controls to monitor the Army's compliance with DOD transient lodging directives.

    Agency Affected: Department of Defense

  7. Status: Closed - Implemented

    Comments: The Army agreed to enforce existing housing reservation policies and, pursuant to new Army Regulation 210-50, will report use of transient lodging facilities.

    Recommendation: The Secretary of the Army should establish controls to ensure that installations fully use on-base facilities before authorizing off-base per diem. At a minimum, those controls should include making authorization of off-base per diem contingent upon a vacancy recheck at some specified time before arrival.

    Agency Affected: Department of Defense: Department of the Army

  8. Status: Closed - Implemented

    Comments: DOD agreed with this recommendation and stated that the Army will enforce existing policy that DVQ be occupied by temporary duty travelers when they are not reserved.

    Recommendation: The Secretary of the Army should establish controls to ensure that installations fully use on-base facilities before authorizing off-base per diem. At a minimum, those controls should include revising room assignment procedures to use DVQ.

    Agency Affected: Department of Defense: Department of the Army

  9. Status: Closed - Implemented

    Comments: The Army has taken a number of actions to ensure that personnel moving to new stations do not displace transient personnel in transient lodging.

    Recommendation: The Secretary of the Army should establish controls to ensure that installations fully use on-base facilities before authorizing off-base per diem. At a minimum, those controls should include ensuring that personnel moving to new stations do not displace transient personnel in transient lodging.

    Agency Affected: Department of Defense: Department of the Army

  10. Status: Closed - Implemented

    Comments: The Army is regularly reviewing barracks occupancy rates at all installations.

    Recommendation: The Secretary of the Army should establish controls to ensure that installations fully use on-base facilities before authorizing off-base per diem. At a minimum, those controls should include instituting regular reviews at all installations of the accuracy of barracks occupancy rates to ensure the identification of vacancies for transient personnel.

    Agency Affected: Department of Defense: Department of the Army

  11. Status: Closed - Implemented

    Comments: DOD concurred with this recommendation and in June 1991, the Army directed its major commands to separate transient housing and MWR funds.

    Recommendation: The Secretary of the Army should direct the major commands and the Army Community and Family Support Center to stop diverting transient lodging funds to MWR activities.

    Agency Affected: Department of Defense: Department of the Army

  12. Status: Closed - Implemented

    Comments: The Secretary of the Army reported transient lodging management as a material weakness in the fiscal year 1990 annual assurance statement.

    Recommendation: The Secretary of the Army should establish controls to ensure that installations fully use on-base facilities before authorizing off-base per diem. At a minimum, those controls should include identifying transient lodging operations as a material weakness in the Secretary of the Army's next annual assurance statement.

    Agency Affected: Department of Defense: Department of the Army

 

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