Military Base Realignments and Closures: Higher Costs and Lower Savings Projected for Implementing Two Key Supply-Related BRAC Recommendations
Highlights
The 2005 Base Closure and Realignment Commission estimated that two supply-related recommendations now being implemented by the Defense Logistics Agency (DLA) would save the Department of Defense (DOD) about $4.8 billion over 20 years--about 13 percent of the 2005 base realignment and closure (BRAC) round's estimated long-term savings. These recommendations focus on business process reengineering by reconfiguring DLA's wholesale supply, storage, and distribution network and transferring procurement responsibility for depot-level reparables from the military services to DLA. This report is one in a series of reports on BRAC conducted under the Comptroller General's authority. It examines (1) the extent to which DLA's cost and savings estimates to implement these recommendations differ from those of the BRAC Commission and (2) DLA's progress and challenges in implementing the recommendations. GAO analyzed estimated cost and savings data and visited several of the military services' depots in its review.
Recommendations
Recommendations for Executive Action
| Agency Affected | Recommendation | Status |
|---|---|---|
| Department of Defense | To provide a more accurate projection of savings associated with implementing the DLA-managed BRAC recommendations, the Secretary of Defense should direct the Director of the Defense Logistics Agency to revise its business plans to exclude all expected savings that are not the direct result of BRAC actions. Such revisions should exclude, for example, the $172 million in potential savings for implementing the supply, storage, and distribution (SS&D) recommendation and the $71 million in potential savings for implementing the depot-level reparable (DLR) recommendation that resulted from pre-BRAC actions associated with inventory reduction initiatives already planned by the services that would have occurred regardless of BRAC. |
Closed – Not Implemented
DOD Non-concurred with this recommendation.
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| Department of Defense | To provide greater accountability and visibility over the financial performance of the DLA BRAC recommendations and to provide a basis for preventing potential premature budget reductions, the Secretary of Defense should direct the Director of the Defense Logistics Agency to implement methodologies for periodically monitoring and updating net savings for the SS&D and DLR recommendations throughout the implementation period. Such methodologies, at a minimum, should include: (1) clear metrics for measuring the magnitude of actual costs and savings, (2) a comparison of the actual costs and savings to the prior estimates to coincide with the required semiannual business plan updates, and (3) explanations for actual cost and savings variances from estimates presented in the business plans. |
Closed – Implemented
The DOD Inspector General's office indicated that DLA updates costs and savings for BRAC recommendations on a semi-annual basis synchronized with the programming and budget cycles. When there was a variance in a funding category, DLA included an explanation for the change in costs and savings.
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| Department of Defense | To ensure adequate funding for successful implementation of the recommendations within the BRAC implementation time frame, the Secretary of Defense should direct the Secretaries of the Army, Navy, and Air Force, the Commandant of the Marine Corps, and the Director of DLA to ensure that necessary funding to meet implementation milestones is reflected in all respective service and DLA budget submissions for the remainder of the implementation period ending in fiscal year 2011. |
Closed – Implemented
The Undersecretary of Defense (Acquisition, Technology, and Logistics)issued a memorandum on June 22, 2007 directing DOD components to fully fund BRAC implementation and to properly inform the planning, programming, budgeting and execution process during the BRAC implementation period, including updating BRAC business plans semi-annually until completion of the BRAC implementation process.
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