Closure and Realignment Savings Are Significant, but Not Easily Quantified
NSIAD-96-67: Published: Apr 8, 1996. Publicly Released: Apr 18, 1996.
- Full Report:
Pursuant to a congressional request, GAO reviewed the Department of Defense's (DOD) cost and savings estimates for past base realignment and closure (BRAC) actions, focusing on the: (1) extent to which DOD is achieving actual savings from BRAC; and (2) adequacy of the DOD process for developing the cost and savings estimates reported in its annual budget submissions.
GAO found that: (1) its analysis of base support costs in the Future Years Defense Plan and at nine closing installations indicates that BRAC savings should be substantial; (2) however, DOD's systems do not provide information on actual BRAC savings; (3) therefore, the total amount of BRAC savings is uncertain; (4) if DOD does not fully achieve estimated BRAC savings, it will affect DOD's ability to fund future programs at planned levels; (5) DOD has complied with the legislative requirement for submitting annual cost and savings estimates, but there are limitations to the submissions' usefulness; (6) for example, the Air Force's savings estimates were not based on budget-quality data, and the Army's estimates excluded reduced military personnel costs that the Navy and the Air Force included in their estimates; (7) further, BRAC cost estimates excluded more than $781 million in economic assistance to local communities as well as other costs; and (8) consequently, the Congress does not have an accurate picture of the savings achieved by the BRAC process.
Recommendation for Executive Action
Status: Closed - Not Implemented
Comments: DOD agreed that the BRAC budget submissions should include an advisory statement that economic assistance and non-DOD costs are not included. DOD also said that it was willing to consider including in its BRAC budget submissions a brief statement explaining that the BRAC budget submissions are based on the initial cost and savings estimates that are subsequently refined through the use of site surveys and updated information to provide budget-quality data. However, DOD has not included these statements in its subsequent BRAC budget submissions.
Recommendation: The Secretary of Defense should, at a minimum, explain the methodology used to estimate savings in future BRAC budget submissions. Also, the submissions should note that all BRAC-related costs are not included.
Agency Affected: Department of Defense