Military Base Realignments and Closures:

DOD Is Taking Steps to Mitigate Challenges but Is Not Fully Reporting Some Additional Costs

GAO-10-725R: Published: Jul 21, 2010. Publicly Released: Jul 21, 2010.

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The 2005 Base Realignment and Closure (BRAC) round is the fifth such round undertaken by DOD since 1988 and is the biggest, most complex, and costliest BRAC round ever. With this BRAC round, the Department of Defense (DOD) plans to execute hundreds of BRAC actions affecting over 800 defense locations, relocate over 123,000 personnel, and spend over $35 billion--an unprecedented amount, given that DOD has spent nearly $26 billion to implement the four previous BRAC rounds combined when all relevant BRAC actions have been completed. As with prior BRAC rounds, DOD is required to implement the BRAC Commission's 2005 recommendations within 6 years of their approval by the President and transmittal to Congress. Unlike with prior BRAC rounds, DOD is implementing the BRAC 2005 round during a time of conflict and significant increases to the defense budget to support ongoing contingency operations. Compounding this challenge, DOD is also implementing other extensive worldwide transformation initiatives such as the permanent relocation of about 70,000 military personnel to the United States from overseas; transformation of the Army's force structure from an organization based on divisions to more rapidly deployable, combat brigade-based units; an increase in the active-duty end strength of the Army and Marine Corps by 92,000 members; and the drawdown of combat forces from Iraq while simultaneously increasing the U.S. military presence in Afghanistan. All of these initiatives are exerting an unusually high demand on DOD's domestic facility infrastructure to accommodate new forces and existing forces being deployed or redeployed. The Office of the Secretary of Defense (OSD) at the outset of BRAC 2005 indicated its intent to reshape DOD's installations and realign DOD forces to meet defense needs for the next 20 years. Moreover, both DOD and the BRAC Commission reported that their primary consideration in making recommendations for the BRAC 2005 round was military value. As such, as opposed to simply closing bases, many of the BRAC 2005 recommendations involve complex realignments, such as designating where military forces returning to the United States from overseas bases would be located; establishing joint military medical centers; creating joint bases; and reconfiguring the defense supply, storage, and distribution network. The BRAC statute requires DOD to complete all BRAC 2005 closures and realignments by September 15, 2011. As we reported in January 2009, DOD expects almost half of the 800 defense locations implementing BRAC recommendations to complete their actions in 2011, with 230 of these 400 locations anticipating completion within the last 2 weeks before the statutory deadline. At the time of this report, DOD had only 14 months remaining until the The House Armed Services Committee report accompanying the National Defense Authorization Act for Fiscal Year 2008 directed the Comptroller General to monitor the implementation of recommendations for the 2005 round of closures and realignments of military installations made pursuant to section 2914 of the Defense Base Closure and Realignment Act of 1990. We prepared this report, our fourth, in response to the mandate, to assess (1) the challenges, if any, DOD faces in implementing BRAC recommendations and (2) DOD's efforts to mitigate any challenges and the extent to which any costs related to those mitigation efforts are being reported as BRAC implementation costs.

DOD is implementing 182 BRAC recommendations for this BRAC round, but several logistical, human capital, and other implementation challenges remain. First, many locations are scheduled to complete the construction, relocation, personnel, and other actions needed to implement the recommendations within months of--and, in some cases, on--the deadline leaving little or no margin for slippage to finish constructing buildings and to move or hire the needed personnel. As of March 2010, DOD had 57 construction projects scheduled to be completed within 3 months of the statutory deadline, representing about 30 recommendations. Second, some DOD locations that involve the most costly and complex recommendations have encountered delays in awarding some construction contracts as well as experienced additional delays in the expected completion of construction. Third, DOD must synchronize the relocation of approximately 123,000 personnel with the availability of about $25 billion in new construction or renovation of facilities. Fourth, delays in interdependent recommendations are likely to have a cascading effect on the timely completion of related recommendations. These challenges have continued since our last report on BRAC implementation challenges, especially contracting and construction delays, which have further squeezed an already tight time line. The potential loss of intellectual capital is complicated by various community effects of BRAC implementation growth, such as transportation, housing, schooling, and availability of medical care. DOD is mitigating some BRAC implementation challenges, which is adding to implementation costs; however, DOD is not reporting all of these additional costs. To enhance its role in managing logistical challenges that could affect DOD's ability to achieve BRAC implementation by the statutory deadline, the military services are working with their leadership to develop solutions. Further, the military services and defense agencies are providing periodic briefings for BRAC recommendations exceeding $100 million in implementation costs, or that have significant concerns such as cost overruns or construction delays to the OSD Basing Directorate. For other BRAC recommendations, DOD is still weighing options, such as moving temporarily into different buildings while construction and renovations are completed, referred to as swing space, or accelerating the pace of construction to complete permanent facilities by the deadline, potentially incurring additional expenses. The DOD Financial Management Regulation requires the services and defense agencies to accurately capture BRAC-related costs in the annual BRAC budget justification materials submitted to Congress. Since DOD's recent fiscal year 2011 BRAC budget request--which was the final annual request for funds for the BRAC account before the statutory deadline for completion of closures and realignments--has already been submitted to Congress, such additional costs in our view may have to be funded from outside the BRAC account. However, we found that DOD's reported costs funded outside the BRAC account are not complete because the Army has not reported to Congress some of these costs as BRAC costs. Thus, OSD officials do not have full visibility over the extent of these costs funded from outside the BRAC account, given that the services prepare their own BRAC budget justification material. Until the Secretary of Defense ensures that all BRAC-related costs are captured and reported to Congress, neither congressional decision makers nor those within OSD who are charged with overseeing BRAC implementation will have a complete picture of the cost of implementing the 2005 BRAC round.

Recommendation for Executive Action

  1. Status: Closed - Implemented

    Comments: On July 21, 2010, we reported in GAO-10-725R, that the military services are addressing various logistical challenges that could affect the Department of Defense's (DOD) ability to complete actions to implement BRAC 2005 recommendations by the statutory deadline of September 15, 2011. As such, DOD was planning on various mitigating actions to be able to provide for buildings and move or hire the needed personnel by the deadline that may lead to additional costs but we found evidence that these costs were not being reported in BRAC budget materials provided to Congress. Therefore, we recommended that DOD take steps to ensure that it captured and appropriately reported to Congress any BRAC-related implementation costs that are funded from outside the BRAC account. Due to our recommended action, on August 5, 2010, the Deputy Undersecretary of Defense (Installations and Environment) issued a guidance memo to the military services and DOD agencies requiring all BRAC business plan managers to fully capture the costs and savings of BRAC 2005 by submitting a final BRAC financial display that captures all BRAC related expenditures (both inside and outside the BRAC account). As a result, Congress will have more visibility over all BRAC implementation costs.

    Recommendation: To enhance OSD's reporting of BRAC implementation costs and increase visibility of added costs due to recent efforts to address various implementing challenges, that Secretary of Defense should direct the Under Secretary of Defense (Acquisition, Technology and Logistics), in coordination with the Under Secretary of Defense (Comptroller), to take steps to capture and appropriately report to Congress any BRAC-related implementation costs that are funded from outside the BRAC account.

    Agency Affected: Department of Defense


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