Military Infrastructure:

Real Property Management Needs Improvement

NSIAD-99-100: Published: Sep 7, 1999. Publicly Released: Sep 7, 1999.

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Pursuant to a congressional request, GAO reviewed the Department of Defense's (DOD) management of the maintenance of its real properties, focusing on: (1) how the services determine and prioritize maintenance and repair requirements and how they allocate resources to meet their needs; (2) promising practices in facility management that the services could consider; and (3) barriers to implementing promising practices and ways to address them.

GAO noted that: (1) DOD does not have a comprehensive strategy for maintaining the services' infrastructure; (2) rather, each service sets its own standards for maintaining infrastructure; (3) as a result, the services differ in the way they rate property conditions, prioritize repairs, and allocate resources; (4) the service headquarters cannot be certain that the most critical properties in need of maintenance and repair are targeted; (5) given incomplete and inconsistent data, and different real property maintenance (RPM) rating systems among the services, Congress cannot be assured that it is funding maintenance and repairs that will provide the best return on its investment; (6) there is little relationship between identified RPM needs and the funds the services allocate for RPM; (7) none of the services' RPM spending plans provide sufficient funding to keep their total backlog of repairs at current levels; (8) although DOD instructed the services in July 1997 to fund RPM to enable them to meet 75 percent of their RPM requirements by 2003, DOD removed that goal from an update guidance in April 1999; (9) because the services' headquarters consistently underfund requirements, base and command officials request funding to cover only a portion of RPM needs; (10) for fiscal year 1997, major commands GAO surveyed reported they requested funding to cover an average of about one-fifth of the RPM needs of their bases and bases reported receiving funding equal to only about one-sixth of their needs; (11) many promising practices exist in the RPM area, including: (a) establishing a single system for counting and categorizing inventory; (b) having a single, valid engineering-based system for assessing facility conditions, with adequately trained personnel and multiple levels of review; (c) prioritizing budget allocations based on physical condition, relevance of facilities to the mission, and life-cycle costing and budgeting; (d) setting up a single property maintenance budget that is controlled by a central office with the power to shift resources to facilities in the greatest need; (e) creating incentives to demolish or vacate excess space; (f) restricting the use of RPM funds for other maintenance purposes; and (g) charging an annual maintenance fee, based on square feet used, to ensure adequate funding for facilities and to create an incentive for space conservation; and (12) none of the military services has implemented all the promising practices for RPM, and their adoption of these practices is hampered by several barriers.

Recommendations for Executive Action

  1. Status: Closed - Implemented

    Comments: The Department of Defense has implemented the recommendation.

    Recommendation: To improve DOD's RPM management and address barriers to change, the Secretary of Defense should fund the development of DOD's strategic facilities plan.

    Agency Affected: Department of Defense

  2. Status: Closed - Implemented

    Comments: DOD has largely implemented all the key elements of the recommendation since late 1999. It has established a uniform, standardized Installation Readiness report (IIR) condition assessment system, requiring the services to report on the impact of the condition of their facilities using the 4-tier system. It has also transformed the way in which RPM funds are tracked, creating two accounts, one for sustainment and the other for military construction (recapitalization). DOD has essentially adopted a life-cycle method of cost calculation of RPM costs, using the metric of recapitalization and a baseline of achieving a 67-year lifecycle average for infrastructure. Therefore, the recommendation has essentially been fully implemented.

    Recommendation: To improve DOD's RPM management and address barriers to change, the Secretary of Defense should fund the development of DOD's strategic facilities plan and develop a cross-service integrated strategy, in close coordination and consultation with the heads of facilities infrastructure of each service, to comprehensively address RPM issues. The strategy should provide, at a minimum, for: (1) uniform standards that set the minimum condition in which military facilities are to be maintained and standardized condition assessment criteria; (2) standard criteria by which the services are to allocate space for different types of facilities (e.g., barracks, classrooms, administrative buildings) and against which RPM funding allocations will be measured; (3) standard criteria for inventorying DOD and service property (except for relatively few service-unique facilities; (4) computerized, on-line inventory and cost databases that permit meaningful comparisons, across and within the services, of RPM spending by type, size, and location of facility and RPM activity, including direct data access by the Office of the Secretary of Defense; (5) standard cost accounting methods by which the services will record and track their RPM expenditures so that they and DOD know how much is being spent, where it is being spent, and on what type of facility or RPM-activity it is being spent, by common metric, using the Army's Directorate of Public Works' Annual Summary of Operations report (published through 1997) as a potential model; (6) the identification of priorities for the services to use to explicitly link needs assessments with resource allocations and tracking systems that show whether or not identified high priority needs are allocated the funds intended for them by Congress; (7) mandated training standards (curriculum and hours) for all those involved in condition assessment and ratings of repair urgency; and (8) the services' adoption of a comprehensive, valid, engineering-based assessment system that incorporates life-cycle planning into facilities maintenance based on the well-developed methods already used by nonmilitary entities.

    Agency Affected: Department of Defense

  3. Status: Closed - Implemented

    Comments: DOD has changed the way it budgets RPM, separating the RPM budget into sustainment/renovation/modernization costs v. military construction costs, and requiring the services do to the same. This has had the intended effects of both permitting careful tracking of expenditures for infrastructure, as well as making it considerably more difficult to migrate funds from one account into another. This was also made difficult by setting a benchmark that the services must fund sustainment at 100% of the calculated requirement (based on square footage and type/location of facility), thereby making it possible to identify any shortfalls. This has proved largely successful.

    Recommendation: The Department's RPM strategy needs to deal with the issue of funding instability, particularly the migration of RPM funds to non-RPM uses and the lack of RPM reserve funds. In this regard, the Department should consider the feasibility of adopting the promising practices identified in this report. To the extent that adoption of any of these practices would require changes to existing law, the Department should develop a legislative proposal for submission to Congress.

    Agency Affected: Department of Defense

 

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