Army Procurement:

Commercial Activity Study for Food Services at Fort Knox May Not Include All Costs

NSIAD-90-5: Published: Oct 6, 1989. Publicly Released: Oct 6, 1989.

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Pursuant to a congressional request, GAO reviewed a proposed Army contract award for food services at Fort Knox, Kentucky, focusing on whether Fort Knox should have contracted for the required services.

GAO found that Fort Knox did not consider the cost of providing additional personnel to supervise military trainees serving as dining hall attendants, which could cost up to $5.6 million over the 5-year contract period. GAO also found that Fort Knox made errors in: (1) determining the cost of wages for intermittent employees; (2) adjusting salaries for increases; (3) including unnecessary personnel costs; and (4) accounting for extended service hours.

Recommendation for Executive Action

  1. Status: Closed - Implemented

    Comments: The Department of Defense (DOD) and the Army disagreed with the major thrust of the recommendation considering the cost of supervision in the cost comparison decision. The requesters agreed to pursue this matter with the Army and stated that GAO could close the case.

    Recommendation: The Secretary of the Army should direct the Commanding General of Fort Knox to develop a specific plan for providing supervision of military dining facility attendants in light of this report. Such a plan should identify the types and number of personnel to be used, the cost that would be incurred solely as a result of contracting out, and if appropriate, the operational impact of reassigning personnel from other duties. The estimated supervision cost should then be factored into the cost comparison, along with the adjustments necessary to resolve the other issues discussed in this report. Unless this analysis indicates that the cost of contracting out the food service will be less than the cost of performance by government workers, the service should continue to be performed in-house.

    Agency Affected: Department of Defense: Department of the Army


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