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Limitations in the Air Force's Proposed Housing Plan for Spangdahlem Air Base, Germany

GAO-06-736R Published: May 19, 2006. Publicly Released: May 19, 2006.
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Highlights

The Air Force plans to construct 233 military housing units on Spangdahlem Air Base, Germany at a cost of $131.3 million spread over fiscal years 2006-2008, and to fund 270 build-to-lease units nearby at an annual cost of $32,888 per unit over 20 years. The Military Quality of Life and Veterans Affairs Appropriations Act for fiscal year 2006 directed the Secretary of the Air Force to submit to the Committees on Appropriations of both Houses of Congress a report containing a housing plan for Spangdahlem. The House Conference Report accompanying H.R. 2528 stipulated that the report must include a complete cost-benefit analysis of available housing options to include build-to-lease housing, and that none of the funds appropriated for family housing at Spangdahlem--nearly $45.4 million--may be obligated until the Secretary of the Air Force certified to the Appropriations Committees that the report had been completed and received the Committees' response or a 30-day period has elapsed after the Committees receive such report. In response to the mandate, the Air Force issued a report in January 2006 that compared its proposed plan with four other housing options that included a combination of traditional military construction, build-to-lease housing, and replacement of existing housing units to meet its housing requirements at Spangdahlem. In the report, the Air Force recommended implementation of its proposed plan and release of the military construction appropriations for fiscal year 2006. The Air Force also concluded that, depending on the results of its efforts to explore cooperative ventures with the local German government and communities and the potential for a larger build-to-lease program, the scope of its military construction projects for future years may need to be adjusted. The Air Force also stated it would provide a status report regarding these adjustments to Congress within 365 days of the Appropriations Committees' release of the fiscal year 2006 military construction appropriation. Specifically, the Air Force proposed to report on the results of the cooperative ventures, number of housing units procured in the fiscal year 2006 military construction project, and proposed adjustments in the scope of the fiscal years 2007 and 2008 military construction projects. In February 2006, the Appropriations Committees released nearly $45.4 million in fiscal year 2006 military construction budget authority for 79 housing units at Spangdahlem. During our ongoing review of the Department of Defense's (DOD) comprehensive overseas master plans, we met with Air Force officials and visited family housing units at Spangdahlem and the base's Bitburg Annex. We briefed Congress on the results of our site visits on February 27, 2006. Subsequently, on March 1, 2006, Congress requested that we review the assumptions and methodologies used in the Air Force's report issued in January 2006. This report responds to that request.

Recommendations

Recommendations for Executive Action

Agency Affected Recommendation Status
Department of the Air Force Because of the uncertainty associated with which factors the Air Force plans to consider when it adjusts the scope of the military construction projects proposed for fiscal years 2007-2008, the Secretary of the Air Force should include, at a minimum, the results of its new housing requirements and market analysis for Spangdahlem (scheduled to be completed in July 2006) in making the required adjustments.
Closed – Implemented
The Senate Report 109-286 accompanying the Military Construction and Veterans Affairs and Related Agencies Appropriation Bill, Fiscal Year 2007, discussed the committee's efforts to conduct an extensive review of the Air Force's housing plan for Spangdahlem, specifically referring to our report. The Senate report further stated that the committee did not expect to fund the Air Force's third phase of housing (94 units) proposed for fiscal year 2008 because other housing options are available at Spangdahlem to meet this need. European Command and Office of Secretary of Defense officials told us that they have removed the fiscal year 2008 project from the Spangdahlem housing plan and that they would look to existing rental units or build-to-lease housing to satisfy the remaining new housing requirements. As a result, the intent of our recommendation has been addressed.
Department of the Air Force To ensure that the status report is based upon sound economic assumptions and methods, the Secretary of the Air Force should calculate life-cycle costs in accordance with OMB guidance on the use of discount rates and in accordance with DOD and Air Force guidance on the use of depreciation to calculate the remaining worth of housing.
Closed – Implemented
The Senate Report 109-286 accompanying the Military Construction and Veterans Affairs and Related Agencies Appropriation Bill, Fiscal Year 2007, discussed the committee's efforts to conduct an extensive review of the Air Force's housing plan for Spangdahlem, specifically referring to our report. The Senate report further stated that the committee did not expect to fund the Air Force's third phase of housing (94 units) proposed for fiscal year 2008 because other housing options are available at Spangdahlem to meet this need. European Command and Office of Secretary of Defense officials told us that they have removed the fiscal year 2008 project from the Spangdahlem housing plan and that they would look to existing rental units or build-to-lease housing to satisfy the remaining new housing requirements. As a result, the intent of our recommendation has been addressed.

Full Report

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Topics

Construction costsCost analysisData integrityHousing constructionLife cycle costsMilitary appropriationsMilitary housingReporting requirementsAir Force basesMilitary forces