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As a result of the 2005 base realignment and closure (BRAC) round, the military services are required to transfer to the Defense Logistics Agency (DLA) all of their supply, storage, and distribution functions at specified depot maintenance locations that are collocated with a DLA distribution depot. These transfer actions are part of a larger BRAC recommendation, commonly referred to as the Supply, Storage, and Distribution (SS&D) recommendation, that is intended to reduce both the number of supply distribution depots and related excess capacity, while providing the Department of Defense (DOD) with a logistics base that saves money and enhances the effectiveness of logistics support to operational forces. There has been disagreement among the services and DLA about whether certain personnel positions that include functions inherently involving both supply and maintenance operations at the services' industrial depots should transfer to DLA as part of this recommendation. The Air Force, Navy, and Marine Corps reached agreement with DLA about these positions in January, February, and April 2007, respectively. After repeated opposition to the transfer of certain positions, in July 2007 the Army agreed to comply with direction from the Office of the Secretary of Defense (OSD) on the specific functions and positions to transfer. DLA subsequently submitted its draft business plan for implementing the SS&D recommendation to OSD for approval on September 18, 2007. Because of the broad congressional interest in the implementation of the 2005 BRAC round recommendations, we prepared this report under the Comptroller General's authority to conduct evaluations on his own initiative. Our work was in response to concerns raised by several congressional offices about possible inefficiencies and disruptions in depot maintenance production that could potentially generate higher costs at the department's depot maintenance activities and affect equipment readiness during a critical time for maintenance and support of our nation's warfighters. Our objectives were to determine (1) what efforts have been made to determine which supply-related functions will transfer to DLA, (2) what are the military services' key concerns in implementing the transfer of functions, (3) the extent to which DLA's plans establish a transfer process that minimizes disruptions depot maintenance, and (4) what are the estimated costs and savings associated with implementing this transfer of functions.

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