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GAO reviewed the Department of Defense's (DOD) Military Housing Privatization Initiative, focusing on DOD's efforts to: (1) measure progress to date; (2) assess issues associated with privatizing military housing; and (3) determine whether the new initiative is being integrated with other elements of DOD's housing programs.

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Recommendations for Executive Action

Agency Affected Recommendation Status
Department of Defense 1. The Secretary of Defense should expedite the Housing Revitalization and Support Office's effort to develop a standardized methodology for comparing life-cycle costs of proposed privatization projects with military construction alternatives. This action should include establishing and monitoring milestones for the development and implementation of the methodology.
Closed - Implemented
DOD originally stated that a policy and procedures handbook was under development. The handbook would include the standard methodology for life cycle cost analyses. A draft handbook was issued for review in October 1998. Since that time, DOD has issued revised draft guidance. However, as of August 2001, final guidance has not been issued and DOD had no firm date for doing so. GAO is following up on DOD's guidance for performing life cycle cost analyses during GAO's current review on the status of the military housing privatization initiative (350074).
Department of Defense 2. The Secretary of Defense should expand the directive to the services concerning their plans for eliminating inadequate housing. Specifically, the Secretary should direct the services to prepare detailed, integrated housing plans that will: (1) describe their plans for improving their housing requirements determination processes; (2) demonstrate how they will attempt to maximize their reliance on community housing in accordance with DOD's stated policy; and (3) outline improvements in housing referral services. The plans should also include analyses of the estimated impact of the new housing allowance program on the availability of housing in local communities and show how housing allowances, traditional military construction, and the privatization initiative will be used in concert to meet DOD's housing needs in the most economical manner. Each service plan should include estimated milestones for achieving the goals of the plan.
Closed - Implemented
According to DOD, it is working to integrate the privatization initiative with other elements of DOD's housing program. DOD has been working to improve the housing requirements determination process for several years. However, needed improvements to this process still have not been implemented. The services have completed housing master plans that specified their respective methodologies to eliminate inadequate housing by 2010. However, the master plans did not analyze how DOD's initiative to increase housing allowances will impact the requirement for military family housing. In GAO's current review of the status of the military housing privatization initiative (350074), GAO is following up on the need for analyses of the housing allowance initiative's impact on DOD's housing program.
Department of Defense 3. The Secretary of Defense should establish a mechanism to promote more effective coordination between the offices responsible for housing allowances and housing management.
Closed - Implemented
DOD has established a Housing Policy Board to coordinate efforts. Agency officials stated that this step should help DOD to address the elements in the recommendation and ensure better integration of DOD's family housing efforts.

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