a

GAO

United States Government Accountability Office

Report to Congressional Committees

April 2005 DOD SCHOOLS

Limitations in 

DOD-Sponsored Study 

on Transfer 

Alternatives 

Underscore Need for 

Additional Assessment

GAO-05-469
What GAO Found

United States Government Accountability Office

Why GAO Did This Study

Highlights

Accountability Integrity Reliability

www.gao.gov/cgi-bin/getrpt?GAO-05-469.

To view the full product, including the scope 

and methodology, click on the link above. 

For more information, contact Barry W. 

Holman at (202) 512-5581 or 

holmanb@gao.gov. 

Highlights of GAO-05-469, a report to 

congressional committees 

April 2005

DOD SCHOOLS

Limitations in DOD-Sponsored Study on 

Transfer Alternatives Underscore Need 

for Additional Assessment 

Officials in the DOD Education Activity, which administers the DOD school 

program, said that neither DOD nor Department of Defense Education

Activity has specific policy guidance related to closing domestic dependent 

elementary and secondary schools. While some expansion and contraction 

of the number of domestic schools operated by DOD occurred between the 

1950s and early 1970s, relatively few have been closed or transferred since 

then, and most of those have been related to base closure activities. For 

affected military families, the retention of these schools is seen as an 

important quality-of-life issue. 

The basis for the expert panel recommendations to transfer selected DOD 

schools to LEAs is difficult to ascertain. Specifically, it is often unclear how 

various analytical factors examined led to recommendations being made. 

For example, in one instance the panel recommended transfer of educational

responsibilities to the neighboring LEA even though the LEA’s per pupil 

costs were higher than DOD’s and the LEA schools were cited as mostly

“underperforming.” Moreover, the study data indicate that DOD could incur 

an estimated $125 million to repair and upgrade existing schools. Under the 

panel’s recommendations, DOD would also have a continuing obligation to 

maintain the schools even after program transfers to the LEAs. Some longterm savings in operating costs could accrue to DOD, but many of these 

costs would need to be absorbed by LEAs or other federal programs. The 

transfer study also indicates that various legal restrictions in some states 

would need to be resolved. Finally, ownership of the schools DOD operates 

needs to be clarified in order to ensure that it is properly reflected in 

property records. 

There are other factors, most not present when the transfer study began, 

that could further complicate school transfer decisions, including ongoing 

DOD plans to relocate about 70,000 military personnel and approximately 

100,000 family members currently stationed overseas to bases in the United 

States within the next few years; Army efforts to reorganize its force 

structure, with the potential for increased numbers of personnel assigned to 

selected military bases in the United States; and the impact of the 2005 base 

realignment and closure round. Likewise, current DOD efforts to privatize 

housing on its military bases could also impact future requirements for 

schools serving military dependents. DOD has appropriately said that it is 

postponing decision making on the results of the transfer study until after 

base closure decisions are finalized later this year. However, the impact of 

troop redeployments and other force structure changes on schools has not 

yet been fully assessed. Given the expected increase of school age military 

dependents on various stateside military bases over the next few years, a 

clear decision on school transfer issues should be made after the results of 

the base closure process and overseas rebasing plans are known to ensure 

adequate planning for facilities by DOD and LEAs. 

The Department of Defense (DOD) 

operates 59 elementary and 

secondary schools serving over a 

dozen military bases in the 

continental United States 

Periodically, questions have been 

raised concerning the continuing 

need for such schools. In 2002, 

DOD commissioned the Donahue 

Institute of the University of 

Massachusetts to examine the 

potential for transferring these 

schools to local education agencies 

(LEAs). GAO’s assessment focused 

on (1) the extent to which DOD has 

established a school closure policy 

and the effect such policies have on 

quality-of-life issues for 

servicemembers and their 

dependents; and (2) the transfer 

study, including the clarity of the 

basis for conclusions reached, the 

overall financial impact, and issues 

identified but not resolved by the 

study. GAO’s report also identifies 

issues not addressed in the transfer 

study that could impact the future 

of DOD’s domestic schools. 

What GAO Recommends

GAO is making recommendations 

to the Secretary of Defense to 

ensure DOD schools are properly 

accounted for in real property 

records and if a transfer decision is 

made, to undertake a more 

complete assessment of impending 

changes in U.S. basing levels and 

their impact on educational facility 

requirements to foster appropriate 

facility planning by DOD and/or 

LEAs. In commenting on a draft of 

this report, DOD concurred with 

GAO’s recommendations. 
Page i GAO-05-469 DOD Schools

Contents

Letter 1

Results in Brief 4

Background 7

DOD Does Not Have Specific Criteria for Closing Schools 11

Expert Panel Recommends Program Transfers to LEAs in Most 

Instances, but Basis for Decisions Are Not Always Clear, and 

Many Issues Remain to be Addressed 14

Other Issues Could Impact Decision Making 19

Conclusions 21

Recommendations for Executive Action 21

Agency Comments and Our Evaluation 22

Appendixes

Appendix I: Expert Panel Members 25

Appendix II: Department of Defense Elementary and Secondary (DDESS) 

Schools in the Continental United States 26

Appendix III: Prior Studies on Transferring DDESS Schools to LEAs 27

Appendix IV: Transfer Study Rules and Alternatives 29

Appendix V: Differing Perspectives on Selected DDESS and LEA Schools 

Contained in Various Transfer Study Report Documents 31

Appendix VI: Comments from the Department of Defense 36

Table Table 1: Expert Panel’s Recommendations 15

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Page 1 GAO-05-469 DOD Schools

United States Government Accountability Office

Washington, D.C. 20548

A

April 26, 2005 Letr

The Honorable John W. Warner

Chairman

The Honorable Carl Levin

Ranking Minority Member

Committee on Armed Services

United States Senate

The Honorable Duncan L. Hunter

Chairman

The Honorable Ike Skelton

Ranking Minority Member

Committee on Armed Services

House of Representatives

Historically, public elementary and secondary education has been a state 

and local responsibility. However, for many years, the Department of 

Defense (DOD) has also operated a number of such schools (currently 59) 

serving over a dozen military bases in the continental United States.1

 

Periodically, questions have been raised within the Congress concerning 

the continuing need for such schools, and various studies were 

commissioned in the 1980s and early 1990s to study the potential for 

transferring responsibility for educating students served by these schools 

to local public school districts—otherwise referred to in this report as local 

education agencies (LEAs). Prior studies identified multiple issues that 

would have to be addressed if a transfer of responsibilities were to be 

attempted, and such transfers were not considered feasible. Furthermore, 

military members served by these schools and related support groups have 

voiced strong support for retention of these DOD schools based on qualityof-life considerations.

In 2002, the department’s attention once again turned to studying the 

potential for transferring DOD’s domestic elementary and secondary 

education program over to LEAs. Officials in the Department of Defense

1

DOD also operates 165 elementary and secondary schools overseas. 
Page 2 GAO-05-469 DOD Schools

Education Activity (DODEA),2 which administers this program, have 

indicated that the new effort was the result of questions raised by the then 

chairman of the House Appropriations Military Construction 

Subcommittee regarding whether there was a need for continued operation 

of these schools by DOD arising from a request for funding for a schoolrelated project on a military base. Additionally, in 2002, as part of its focus 

on improving management of the department, DOD’s senior leadership 

endorsed examining departmental functions to determine whether they 

were core to the department’s warfighting mission, with expectations that 

needed products or services associated with non-core functions should be 

obtained from other government agencies or the private sector. In 

announcing that it would begin a new study of elementary and secondary 

schools operated by DOD on 14 installation areas in seven states including 

Alabama, Georgia, Kentucky, North Carolina, South Carolina, New York, 

and Virginia, Department of Defense Domestic Dependent Elementary and 

Secondary Schools’ (DDESS) press release indicated that the study would 

“focus largely on the ability and willingness of LEAs to assume educational 

responsibility for the students currently enrolled in DOD’s domestic 

schools.” The transfer study effort, apart from a facilities analysis phase by 

Parkhill, Smith, and Cooper Inc., was completed under contract by the 

Donahue Institute of the University of Massachusetts.3

The Donahue Institute retained an independent panel of education experts4

which developed recommendations based on the Institute’s data and the 

facility data obtained under the Corps of Engineers contract. The panel of 

experts recommended transferring educational responsibilities at 10 of 14 

installation areas studied from DDESS schools to LEAs. DOD does not 

plan to make a decision regarding the recommendations until after 

decisions on the upcoming base realignment and closure round are 

completed later this year.

2

DODEA, the umbrella agency created in 1994 to oversee the DOD school systems, operates 

under the direction of the Deputy Under Secretary of Defense, Military Community and 

Family Policy, and the Under Secretary of Defense, Personnel and Readiness. Subordinate 

organizations within DODEA are the Department of Defense Domestic Dependent 

Elementary and Secondary Schools (DDESS) system, which operates schools in the 

continental United States, Puerto Rico and Guam, and the Department of Defense 

Dependents Schools (DODDS) system, which operates schools on military bases overseas.

3

The Donahue Institute is the public service, outreach, and economic development unit of 

the University of Massachusetts President’s Office. 

4

See appendix I for biographical information on the panel members.
Page 3 GAO-05-469 DOD Schools

Section 597 of the Ronald W. Reagan National Defense Authorization Act 

for Fiscal Year 2005,5

 which was signed into law on October 28, 2004, 

required the Comptroller General to prepare a report containing:

(1) an assessment of the policy of the Department of Defense, and the 

criteria utilized by the department, regarding the closure of Department of 

Defense dependent elementary and secondary schools, including whether 

or not such policy and criteria are consistent with department policies and 

procedures on the preservation of the quality-of-life of members of the 

Armed Forces and their dependents; and 

(2) an assessment of any current or on-going studies or assessments of the 

department with respect to any of the schools. 

The legislation required that the report be submitted to the Senate and 

House Armed Services committees not later than 180 days after the date of 

the enactment of the legislation.

Our assessment focused on (1) the extent to which DOD has established a 

school closure policy and the effect such a policy has on quality-of-life 

issues for servicemembers and their dependents; and (2) the transfer study 

conducted by the Donahue Institute, including the clarity of the basis for 

conclusions reached, the overall financial impact, and issues identified but 

not resolved by the study. While conducting this work, we also noted other 

issues not addressed in the transfer study that could impact decision 

making regarding the future of DOD’s domestic elementary and secondary 

schools.

In completing this engagement, we interviewed DODEA officials regarding 

their policy guidance related to closing schools and reviewed the results of 

the recent study dealing with the potential transfer of DDESS schools to 

LEAs. We discussed the study design and methodology with officials of 

DODEA, DDESS, the Donahue Institute and two of the three members of

the panel of experts employed by the institute to review its data and to 

develop study recommendations. We examined the various study summary 

documents to try to gauge the basis for the study’s recommendations and 

determine how clearly the recommendations were linked to the summary 

information provided. We also reviewed summaries of interviews 

completed by the institute with leaders in affected DDESS schools and 

5

Pub. L. No. 108-375.
Page 4 GAO-05-469 DOD Schools

local education agencies to confirm and better understand the range of 

issues associated with the issue of potential transfer of the schools to 

LEAs. Likewise, we also discussed relevant issues concerning federal 

impact aid and experience in transferring federally owned schools to LEAs 

with officials at the U.S. Department of Education. Given time constraints, 

we did not attempt to validate data included in DOD’s transfer study, but 

we did review the steps taken by the Donahue Institute to verify its data 

and analysis and to compare key data against other available data sets to 

corroborate its relative accuracy. We obtained other relevant statistical 

data concerning data about DDESS schools from DODEA and made limited 

checks to assure ourselves that the data was sufficiently accurate for the 

purposes of our review. 

We conducted this review from January to April 2005 in accordance with 

generally accepted government auditing standards. Further details about 

our scope and methodology appear at the end of this report.

Results in Brief While DOD has previously urged its components to examine for potential 

divestiture or outsourcing to the private sector functions not core to 

warfighting efforts, DODEA officials told us that neither DOD nor DODEA 

has specific policy guidance related to closing dependent elementary and 

secondary schools, the retention of which under DOD are seen by some 

servicemembers and their dependents as important to their quality of life. 

The officials noted the elimination of only three domestic schools in the 

past few years; one in 2001 in Georgia as the result of military housing 

privatization when the school transferred to an LEA, and two others in 2004 

as the result of a base closure in Puerto Rico. Survey data from the recent 

and previous transfer studies clearly indicate that for military families, 

whose dependents attend DDESS schools, retention of those schools is an 

important quality-of-life issue. While their children represent a very small 

percentage of the dependent school-age population, affected 

servicemembers’ views of the quality of education and related services 

provided by the dependent schools makes the retention of these schools 

very important to them. The importance of these schools has been 

affirmed in departmental guidance concerning what functions could be 

performed by the private sector. That guidance currently permits 

principals and faculty at DOD Dependent Schools to be exempted from 

outsourcing consideration recognizing these functions could be performed 

by the private sector (but without the same effect—i.e., military 

performance of these activities carries special meaning for military
Page 5 GAO-05-469 DOD Schools

personnel and their families).6 Nonetheless, the future of these schools has 

been subject to some uncertainty in recent years due to congressional 

concerns and as DOD began emphasizing the assessment of functions not 

core to warfighting missions for potential outsourcing which resulted in the 

initiation of the recent transfer study. 

While the recent study sought to complete a more comprehensive 

assessment of the transfer issue than prior studies, the basis for the panel 

of experts recommendations is difficult to ascertain where transfers of 

DDESS’ educational responsibilities are recommended. In addition to 

costs that would be incurred by DOD, legal and other issues could 

complicate the implementation of the panel’s recommended school 

transfers to LEAs. The panel’s recommendations report does not always 

provide a clear or concise indication of the key factors supporting the 

transfer of educational programs from DDESS to LEAs. Specifically, it is 

often unclear how the panel of experts evaluated various analytical factors 

leading to its recommendations based on information provided in the 

various study documents. Two expert panel members we contacted 

acknowledged that the panel’s recommendations were subjective but based 

on all the members’ collective expertise and experiences. However, 

information provided in the various study report documents sometimes 

raised more questions than it answered. For example, the panel in two of 

three instances where there was more than one affected LEA 

recommended transferring educational responsibilities to one of the LEAs 

even though the local school district was considered to be 

“underperforming” when another “overperforming” LEA was available with 

lower per pupil costs. In addition, the panel recommended a LEA over 

DDESS even though the LEA’s per pupil costs were higher and its schools 

were cited as mostly “underperforming.”7

 The study data indicate that 

DOD could incur an estimated $125 million to repair and upgrade existing 

DDESS schools. In addition, DOD would have a continuing obligation to 

6

Enclosure 6, Manpower Mix Criteria Codes, Office of the Secretary of Defense memo, “2003 

Commercial and Inherently Governmental Activities Inventory Data Call” (Dec. 16, 2003).

7

The Donahue Institute used student performance on statewide/DDESS system-wide 

academic tests to measure school performance. The institute developed a performance 

index that took into account the socio-demographic effect of the percentage of students 

receiving free or reduced price lunches on a school’s performance. It used a regression 

approach to estimate this effect on schools in each state by subject and grade. The institute 

was then able to categorize each school’s performance as “overperforming” or 

“underperforming” relative to the school’s predicted performance given its percentage of 

students receiving free or reduced price lunches.
Page 6 GAO-05-469 DOD Schools

maintain the school facilities even after transfer of educational 

responsibility to the LEAs, under the transfer alternative recommended by 

the panel. Long-term savings in operating costs could accrue to DOD but 

many of these costs would need to be absorbed by LEAs and would, to 

some extent, create an additional burden for the U.S. Department of 

Education as it distributes available resources to LEAs that become eligible 

for increased impact aid as a result of educating more military-connected 

students.8

 At the same time, numerous other issues would arise if efforts 

were made to implement the transfers, such as clarifying current 

ownership of the schools between DOD and the U.S. Department of 

Education and differences in their relative legislative authorities for 

transferring federally owned schools to LEAs.9

 Other legal restrictions in 

some states would likely prohibit LEAs from readily taking possession of 

facilities located on federal lands. The panel of experts recognized that any 

transfers would need to be done on an individual, negotiated basis. 

Apart from the issues identified in the transfer study, there are other 

factors/issues not addressed in the study, most of which were not present 

when the study began, that could impact DDESS and LEA schools, and 

further complicate school transfer decisions. The study does not recognize 

such ongoing DOD plans as: 

• the restationing of about 70,000 military personnel and approximately 

100,000 family members currently stationed overseas to bases in the 

United States within the next few years; 

• Army efforts to reorganize its force structure, with the potential for 

increased numbers of personnel assigned to selected military bases in 

the United States; and 

• the impact of the 2005 base realignment and closure round. 

DOD has appropriately said that it is postponing decision making on the 

results of the transfer study until after base closure decisions are finalized 

8

LEAs receive federal payments to compensate for the loss in tax revenues due to the 

presence of tax-exempt federal property and increased school enrollments due to federal 

activities.

9

Resolution of this issue is important toward ensuring proper accounting for property in the 

appropriate agency’s property records and limiting the government’s exposure to legal 

liabilities.
Page 7 GAO-05-469 DOD Schools

later this year. Likewise, current DOD efforts to privatize housing on its 

military bases, combined with rebasing efforts noted previously could also 

impact future requirements for on-base dependent schools. However, the 

impact of these housing factors has not yet been fully assessed. 

Nevertheless, given the expected increase of school age military 

dependents on stateside military bases over the next few years, a clear 

decision on school transfer issues made sooner rather than later would 

help to ensure adequate planning for facilities by DOD and LEAs. 

GAO recommends that the Secretary of Defense resolve continuing 

uncertainty regarding the school transfer issue to foster appropriate facility 

planning by DOD and/or LEAs. 

Background Notwithstanding that public elementary and secondary education 

historically has been a state and local responsibility, DOD has also operated 

such schools at selected U.S. and overseas locations to educate military 

dependents residing on military bases. Collectively, the domestic and 

overseas programs operate over 200 dependent schools in the United 

States, U.S. territories, and overseas,10 with 59 schools operated in the 

continental United States. (See appendix II for a listing of these DDESS 

school locations.) Approximately 105,000 students are enrolled in these 

combined programs, with approximately 24,000 students attending the 59 

schools in the continental United States. DDESS schools mostly serve 

elementary school-aged students in the United States, with older students 

attending public schools off the installations. The overseas DODDS 

system has approximately 12,000 employees while the DDESS system has 

approximately 5,700 employees. The combined operating budget for both 

systems and headquarters in fiscal year 2005 is about $1.49 billion of which 

approximately $367 million is for operating DDESS schools.11

As we have previously reported, the federal government’s operation of 

elementary schools in the continental United States to educate military 

dependents residing on military bases traces its history back many years 

and to locations where a suitable free public education was not available.12 

10Overseas schools were added following World War II when the military established schools 

for the children of its servicemembers stationed in Europe and the Pacific.

11These are operations and maintenance funds, and do not include procurement and military 

construction funding.
Page 8 GAO-05-469 DOD Schools

There were a variety of reasons for establishing schools on military bases, 

including military installations that were located in sparsely populated 

areas and efforts to avoid racial segregation at the neighboring school 

districts. 

From 1951 to 1981, funding responsibility for the domestic schools resided 

with the Department of Health, Education, and Welfare, and subsequently 

with the Department of Education. The Omnibus Budget Reconciliation 

Act of 1981 (Public Law 97-35) transferred funding responsibility to DOD. 

Today, DODEA, the umbrella agency created in 1994 to administer the 

overseas (DODDS) and domestic (DDESS) systems, operates under the 

direction of the Deputy Under Secretary of Defense, Military Community 

and Family Policy, and the Under Secretary of Defense, Personnel and 

Readiness. 

The DDESS model is but one of several approaches to providing 

elementary and secondary education to dependents of military personnel 

residing on military bases in the United States. There are 33 Department of 

Education-owned schools located on military bases but operated by LEAs, 

providing education for military dependents residing on those bases. The 

Department of Education has been gradually transferring these schools to 

LEAs as funds are available to upgrade the condition of the schools to 

encourage acceptance of the schools by LEAs.13 In other instances, LEAs 

own and operate schools located on military bases. Finally, in a limited 

number of instances, DOD directly funds LEAs to educate military 

dependents at schools operated on military bases. 

Periodically, questions have arisen within the Congress concerning the 

continuing need for such schools within the continental United States, and 

various studies were commissioned in the 1980s and early 1990s to evaluate 

the potential for transferring the schools to LEAs.14 In December 1986 we 

examined three methods to educate military dependents, then in selected 

use, which were viewed as alternatives to the DOD-funded and operated 

12See GAO, DOD Schools: Funding and Operating Alternatives for Education of 

Dependents, GAO/HRD-87-16 (Washington, D.C.: Dec. 10, 1986).

13This represents some reduction in such schools from an available listing of such schools 

contained in a previous transfer study conducted 10 years ago. Some reductions occurred 

because of base closure, demolition, or transfers to LEAs. 

14Appendix III provides a list and summary of relevant previous reports that examined the 

potential for transferring schools from DOD to LEAs.
Page 9 GAO-05-469 DOD Schools

schools. They included: (1) operation by local school districts, with 

funding from federal, state, and local governments; (2) DOD contracting 

with local school districts for educational services; and (3) coterminous 

operation, whereby dependents’ schools operated as local school districts 

whose boundaries were the same as the military installations’ boundaries, 

and where funding for those districts was shared by the Department of 

Education (through the federal impact aid program) and the responsible 

state government. We reported in December 1986 that creation of school 

districts coterminous with military installations appeared to be the best of 

the three alternatives, in part because such an approach would likely 

minimize the transfer of students from existing schools and eliminate costs 

to DOD. However, according to a DODEA official, most states have since 

passed laws that prohibit the creation of new school districts, which 

eliminates the coterminous option from consideration. We also reported 

that jurisdictional, legal, and other issues could impede consideration of all 

three alternatives. Subsequent studies by others offered varying degrees of 

insights regarding these alternatives and difficulties likely to be 

encountered in trying to implement them, and often identified multiple 

issues that would have to be addressed—including legal and financial 

issues, and strong opposition from affected military families—if a transfer 

of responsibilities were to be attempted. As a result, school transfers were 

not considered feasible. (See app. III for a synopsis of each of the prior 

studies.)

In 2002, DOD’s attention again turned to studying the potential for 

transferring DOD’s domestic elementary and secondary education program 

over to LEAs. DODEA officials have indicated that the new effort was the 

result of questions raised by the then chairman of the House 

Appropriations Military Construction Subcommittee regarding whether 

there was a continuing need for DOD to operate these schools triggered by 

a request for funding for a school-related project on a military base. We 

also note that in 2002, as part of its focus on improving management of the 

department, DOD’s Senior Executive Council15 endorsed a core 

competency-based approach for DOD sourcing decisions—that is, the 

decision to use a public or private sector source to perform a necessary 

15 The Senior Executive Council, a high-level management committee, was established in 

2001 to (1) help guide efforts across the department to transform and improve the 

department’s business practices, and (2) to function as a board of directors for DOD. The 

Council, chaired by the Secretary of Defense, also included the Deputy Secretary of 

Defense, the service secretaries, and the Under Secretary of Defense for Acquisition, 

Technology and Logistics. 
Page 10 GAO-05-469 DOD Schools

agency function or activity was based on whether the function or activity 

was core to the agency’s mission. The Senior Executive Council believed 

that the department should focus its energies and talents on those 

functions that were core or directly linked to its warfighting mission. These 

core functions must be performed by the agency, with the expectation that 

necessary products or services associated with non-core functions should 

be obtained from other government agencies or the private sector.16

A DDESS press release, announcing the planned transfer study in 2002, 

indicated that the study would “focus largely on the ability and willingness 

of LEAs to assume educational responsibility for the students currently 

enrolled in DOD’s domestic schools.” This transfer study was performed in 

multiple phases that included:

• A facility condition assessment performed by Parkhill, Smith, and 

Cooper, Inc., and contracted through the Army Corps of Engineers. 

Field observer site visits were made to document the current physical 

condition of each school, estimate probable costs for remediation, and 

assess whether renovation or replacement was needed. This assessment 

identified about $125 million in remediation costs for all 58 DDESS 

schools surveyed and about $33 million to replace 4 of the schools.17

• A data collection and analysis phase conducted by the Donahue 

Institute of the University of Massachusetts to examine the feasibility of 

transferring 5818 DDESS schools operating in the continental United 

States to local school districts. A set of transfer alternatives was 

developed and analyzed for each of the DDESS schools.

• Use of a three-person expert panel, approved by DOD and contracted by 

the Donahue Institute to independently assess the Institute’s data and 

analysis and make recommendations regarding transfer alternatives. 

16See GAO,, Defense Management: DOD Faces Challenges Implementing Its Core 

Competency Approach and A-76 Competitions, GAO-03-818 (Washington, D.C.: July 15, 

2003).

17DOD’s Fiscal Year 2006 budget request is for $34.7 million in military construction for a 

new DDESS elementary school at Fort Stewart, Ga., and a new elementary/junior high 

school addition at Fort Bragg, N.C.

18While DDESS currently operates 59 domestic elementary and secondary schools in the 

United States, only 58 were in operation at the time of the study.
Page 11 GAO-05-469 DOD Schools

• A quality-of-life assessment, based on an October 2003 meeting in 

Peachtree City, Georgia, with representatives of the domestic DDESS 

schools and installations where their views were solicited and 

documented. Participants included installation commanders, students, 

parents, union leaders, and special interest groups. 

The recommendations of the panel of experts were submitted to DODEA in 

December 2003, but remained closely held without widespread 

dissemination inside the department and without public dissemination 

until February 2005. At the time we completed our work, DOD had not 

made a decision regarding adoption of the panel’s recommendations, 

postponing such a decision until later this year after decisions related to 

the 2005 base realignment and closure round are completed.

DOD Does Not Have 

Specific Criteria for 

Closing Schools 

While DOD has previously urged its components to examine for potential 

divestiture or outsourcing of functions not core to warfighting efforts to the 

private sector, neither DODEA nor DOD has policy guidance related to 

closing the dependent elementary and secondary schools operated by the 

department. While expansion and contraction of the number of domestic 

schools operated by DOD occurred between the 1950s and early 1970s, 

relatively few have been closed or transferred since then, and most of these 

have been related to base closure activities. For affected military families, 

the retention of these schools is seen as a quality-of-life issue, but there are 

varying perspectives on this issue within DOD.

DOD Has Eliminated Few 

Domestic Schools in Recent 

Years 

DODEA officials told us they had eliminated only three domestic schools in 

the past few years; one in 2001 in Georgia as the result of military housing 

privatization initiative, and two others in 2004 as the result of a base 

closure in Puerto Rico.19 This contrasts with an earlier period between the 

1950s and 1970s when there was a more robust expansion and contraction 

in such schools. 

Per the 2004 defense appropriations act, the Roosevelt Roads Naval Station 

in Puerto Rico was closed in 2004 and, as part of that closure, the DDESS 

19A few additional schools were closed during prior base closure rounds because of 

domestic base closure rounds conducted from 1988 through 1995. Any additional dependent 

school closures related to the 2005 base closure process will not be known until later this 

year when base closure decisions will be finalized. 
Page 12 GAO-05-469 DOD Schools

schools on that base also closed. The only other instance of a DDESS 

school being eliminated in recent years occurred in 2001 as a result of the 

department’s housing privatization efforts. In that instance, land 

associated with on-base housing at Warner Robins Air Force Base, Georgia, 

was transferred to a contractor and the land transferred included one of the 

base’s two schools. As a result, the school was subsequently transferred to 

the LEA, which became responsible for educating students at that school. 

DOD housing privatization officials indicated they do not currently 

anticipate similar transfers of schools in the future.

Earlier transfer studies point to expansion and contraction of DOD 

operated schools on military bases between 1950 and 1970. Schools were 

added to the DDESS system as a result of the racial integration of the 

military during the time when the schools in the neighboring LEAs 

remained segregated. At one point, about 100 military installations 

reportedly had schools that belonged to what is now the DDESS system. 

Various studies report a subsequent contraction in the number of these 

schools due to a variety of factors including successful implementation of 

integration policies in many instances that allowed base schools to rejoin 

their former LEAs, pressure from the U.S. Department of Education on 

states and localities to acknowledge responsibility for the education of 

military dependents, and commercial and residential development 

adjacent to some bases that enabled the LEA to provide a viable 

educational program. 

Retention of Domestic 

Dependent Schools Is Seen 

as a Quality-of-Life Issue

Survey and other data from the current and earlier studies on transfer 

issues clearly indicate that affected military families, whose dependents 

attend DDESS schools, view their retention as a quality-of-life issue. While 

their children represent a very small percentage of the dependent schoolaged population, affected servicemembers’ views of the quality of 

education and related services provided by the dependent schools makes 

clear that the retention of these schools is very important to them. An 

October 1997 Defense Manpower Data Center study noted that “the loss of 

the DDESS schools would undoubtedly be viewed as another loss of a 

military quality-of-life benefit. But unlike many other benefit cuts... that 

affect all or most military servicemembers, the loss of this benefit would 

affect a small proportion of military servicemembers.” 

The Defense Manpower Data Center report also indicated that DDESS 

students comprised only three percent of all school-aged children of activeduty servicemembers. DODEA provided us with data that indicate that 
Page 13 GAO-05-469 DOD Schools

figure remains current today. Moreover, only 23 percent of all school-aged 

dependents of military members assigned to the installations served by 

DOD’s domestic dependent schools in the continental United States attend 

the schools. This can be attributed to the fact that many military families 

reside in local communities—that is, not on the base—and thus are not 

eligible to attend DDESS schools, and the fact that relatively few DDESS 

schools provide education for high school students.

DOD’s guidance for deciding what functions the department performs that 

could be considered commercial in nature and readily available in the 

private sector, has exempted DOD schools from outsourcing consideration. 

DOD’s guidance stipulates that principals and faculty at DOD dependent 

schools perform functions that could be performed by the private sector 

“but without the same effect—i.e., military performance of these activities 

carries special meaning for military personnel, and their families.” The 

guidance also notes that principals and faculty at DOD Dependent Schools 

demonstrate family support, promote quality-of- life and foster 

camaraderie for recruitment and retention purposes. Accordingly, DOD 

dependent schools were exempt from private sector performance 

comparisons. In addition, in recent years, DOD has sought a more 

aggressive look at whether various functions are core to the department’s 

warfighting mission, and to increase the number of functions that might be 

performed by the private sector. Dependent schools are one such function 

that has sometimes been questioned regarding its connection to DOD’s 

core mission. 

Conversely, in July 2002, DOD published A New Social Compact: A 

Reciprocal Partnership Between The Department of Defense, 

Servicemembers and Families. The document was issued under the 

auspices of the Deputy Assistant Secretary of Defense (Military Community 

and Family Policy). It noted that in 2001, the President had issued a 

National Security Presidential Directive requiring the Secretary of Defense 

to undertake a review of measures for improving the quality of life for 

military personnel and provide recommendations for their implementation. 

While the new compact did not specifically address the issue of whether 

DOD dependent schools should be retained or transferred to LEAs, it did 

include a section devoted to enhancing educational opportunities provided 

through DODEA worldwide. 
Page 14 GAO-05-469 DOD Schools

Expert Panel 

Recommends Program 

Transfers to LEAs in 

Most Instances, but 

Basis for Decisions Are 

Not Always Clear, and 

Many Issues Remain to 

be Addressed

The panel of experts recommended transferring most educational 

responsibilities from DDESS schools to LEAs at 10 of 14 installation areas 

studied. The institute sought to contrast DDESS and LEA schools to guide 

the panel’s analysis and process for making recommendations. 

Nonetheless, the basis for these recommendations is difficult to ascertain 

based on study report documents. The study indicates that DOD could 

incur significant costs, as well as face legal and other issues related to the 

transfer of schools to LEAs. Finally, the panel recognizes that such 

transfers would have to be done on an individual, negotiated basis.

Transfer Study Contrasts 

DDESS and LEA Schools to 

Guide Expert Panel’s 

Recommendations

The Donahue Institute study built on the work of prior studies, examining 

many transfer alternatives previously considered in earlier studies ranging 

from the status quo to the transfer of educational programs to LEAs. While 

various issues addressed in the study were similar to those previously 

studied—such as facility conditions and remediation costs and identifying 

transfer options and impediments to their use—it sought to make a 

comparative assessment of DDESS and surrounding LEA schools to 

provide the basis for informed decision making. The report noted that the 

expert panel established the following guiding principles to guide its 

recommendations:

• All students transferred from DDESS to local public schools must be 

provided comparable educational programs, services and facilities.

• School communities gain from diversity.

• Cost effectiveness of government. Any transfer alternative must be costeffective not only to DODEA, but to the state and local entities involved.

• Deference to the needs of younger students. It is rarely advisable to 

transfer or otherwise disrupt the educational process of very young 

students.

• Any transfer of DDESS will include just and reasonable compensation to 

the LEA for operational and facilities costs.

• Each installation/LEA will be considered separately.
Page 15 GAO-05-469 DOD Schools

The report noted that the experts stressed that while each one was 

important, no single principle or criterion would necessarily rule in or out a 

transfer alternative. Rather, the totality of all financial and non-financial 

factors was carefully considered, evaluated, and factored into each 

recommendation. The panel also developed feasibility rules associated 

with any transfer decisions to help assure basic equity and fairness for the 

students, families, and communities that might be affected by the study. 

Appendix IV includes summary information on the rules and alternatives 

considered. 

The expert panel recommended that the educational responsibility for 

most schools in 10 of the 14 installation areas be transferred to the LEAs, 

and with use of DDESS operated facilities in most instances, as noted in 

table 1.

Table 1: Expert Panel’s Recommendations

State(s) 

Affected

Principal Installation(s) 

Served

Number of

Schools

Affected Local Education 

Agency Study Recommendation

Alabama Fort Rucker 2 Daleville City Schools

Enterprise City Schools

Ozark City Schools

Status quo

Alabama Maxwell Air Force Base 1 Montgomery County Schools Status quo

Georgia Fort Benning 7 Muscogee County Schools

Chattahoochee County Schools

Transfer responsibility for schooling 

to LEA

Georgia Robins Air Force Base 1 Houston County Schools Transfer responsibility for schooling 

to LEA

Georgia Fort Stewart 2 Liberty County Schools Transfer responsibility for schooling 

to LEA

Kentucky/

Tennessee

Fort Campbell 8 Clarksville-Montgomery County 

Christian County Schools

Transfer responsibility for schooling 

to LEA

Kentucky Fort Knox 8 Hardin County Schools

Meade County Schools

Transfer responsibility for schooling 

to LEA

New York U.S. Military Academy, 

West Point

2 Highland Falls Central School 

District

Transfer responsibility for schooling 

to LEA

North Carolina Fort Bragg 9 Cumberland County Schools Transfer responsibility for schooling 

to LEA

South Carolina Fort Jackson 3 Richland County 2 School 

District

Status quo

North Carolina Camp Lejeune 8 Onslow County Schools Transfer responsibility for schooling 

to LEA
Page 16 GAO-05-469 DOD Schools

Source: Expert panel’s recommendations report.

a

 A third DDESS school, not included in the transfer study, has subsequently become operational, 

increasing the total DDESS domestic schools to 59.

The expert panel recommended transferring most school programs to 

LEAs with use of existing school facilities on the military installations, but 

with DOD continuing to be responsible for funding maintenance, 

operations, and improvements for most facilities. The panel of expert’s 

recommendation for continued DOD responsibility for the facilities was 

attributed to legal difficulties the expert panel believed existed in some 

states that could prohibit LEAs from expending funds for schools located 

on federal lands, as well as the recognized need to provide reasonable 

assistance to the LEAs. In total, LEAs were projected to use 45 DDESS 

operated schools, but take title to only 1 of them. 

The recommendations included just a few exceptions to the recommended 

transfer approach wherein DOD would continue to maintain the school 

facilities. For two South Carolina (Laurel Bay area) school programs 

recommended for transfer, one school would be retained by DDESS to 

continue educating Pre-K through grade 3 students, and one school would 

be transferred to the LEA through a title transfer—the only title transfer 

recommended. In another instance—involving Quantico, Virginia schools 

and the Prince William County Schools—responsibility for educating about 

fifty percent of the school children would be transferred, but without any 

of the school facilities. The Prince William County LEA reportedly had 

indicated an unwillingness to use the DDESS school facilities. At West 

Point, New York, responsibility for educating all children would be 

transferred to the LEA and it would use only one DDESS facility. 

Notwithstanding the panel of expert recommendation that DOD continue 

to fund maintenance and operation for most of the school facilities, we 

found that clarification of ownership of DDESS-operated school facilities 

South Carolina

(Laurel Bay)

Marine Corps Air Station 

Parris Island

Naval Hospital

2a Beaufort County Schools Status quo for Pre-K – 3 grade; 

transfer grade 4-6

Virginia Dahlgren Naval Surface 

Warfare Center

1 King George County Schools Status quo

Virginia Quantico Marine Corps 

Base

4 Prince William County Schools Status quo Pre-K - grade 3; transfer 

grades 4-12 to LEA

Total 58

(Continued From Previous Page)

State(s) 

Affected

Principal Installation(s) 

Served

Number of

Schools

Affected Local Education 

Agency Study Recommendation
Page 17 GAO-05-469 DOD Schools

between DOD and the U.S. Department of Education needs to be 

addressed. In completing this review we found that despite DOD having 

assumed responsibility for operating the current DDESS facilities from the 

U.S. Department of Education many years ago, a majority of the 58 school 

facilities had not been formally transferred to DOD. U.S. Department of 

Education officials told us they were working to transfer the schools to 

DOD. Resolution of this issue is important to ensure proper accounting for 

property in the appropriate agency’s property records. At the same time, 

we also learned that any efforts by DOD to transfer schools to LEAs where 

it has clear ownership of the property could be more difficult and time 

consuming than for the Department of Education since the latter has 

specific legislative authority authorizing such direct transfers.20

Lack Of Clarity for Selecting 

LEAs Over Some

DDESS Schools And 

Proposing Transfers of Most 

Schools

While the methodology used by the Donahue Institute and its expert panel 

reportedly guided data gathering, analysis, and development of 

recommendations, the expert panel’s summary comments and various 

binders of data comprising the study report do not always make clear the 

basis for the panel’s recommendations. The report stated that the panel 

agreed that no single factor would be the basis of a decision to accept or 

reject a specific alternative. How the panel of experts evaluated the 

various factors in order to come up with recommendations is not always 

clear based on information provided in the various study documents. Two 

of the expert panel members we contacted acknowledged that the 

recommendations were subjective but based on all the members’ collective 

expertise and experiences.

Moreover, we found instances where data for selected quality measures 

such as teacher to student ratios and teacher qualifications included in 

various study report documents provide mixed pictures of comparative 

quality factors between DDESS and LEA schools.21 For example, in a few 

instances, the panel recommended transfers to LEA districts even though 

the district schools were considered to be “underperforming” while 

another adjacent LEA’s schools were considered “overperforming” and 

2020 U.S.C. §7708. Absent specific transfer authority DOD property disposal would be 

subject to the more lengthy procedures of the Federal Property and Administrative Services 

Act, administered by the General Services Administration. 

21The expert panel’s recommendations report, which included summary data comparing and 

contrasting LEA and DDESS schools, did not always agree with the comparative data 

included in various summary reports provided by the Donahue Institute staff. 
Page 18 GAO-05-469 DOD Schools

with lower per pupil costs; or a LEA was recommended over DDESS even 

though the LEA’s per pupil costs were higher and its schools were cited as 

mostly “underperforming.”22 Appendix V highlights examples of the 

divergent information contained in various transfer study documents for 

four installations. 

DOD Would Achieve 

Savings, but Some Costs 

Would Be Shifted to 

Department of Education 

and LEAs

In transferring the education responsibility to LEAs, DOD would achieve 

savings in costs it currently incurs by operating schools, but many of these 

costs would be shifted to others. 23 However, study data indicate that DOD 

could incur costs of about $125 million to repair and upgrade existing 

DDESS school facilities,.24 Moreover, DOD would also continue to have 

ongoing costs to maintain the school facilities as the education programs 

are operated by the LEAs under the alternative recommended by the panel 

of experts. At the same time, given various pending changes in basing 

arrangements that will likely increase the number of dependent students at 

bases in the United States, we believe that the facility costs contained in 

the study would be subject to change before any potential decision to 

approve the study recommendations was implemented.

The study, based on data provided by the Department of Education, 

assumes that many costs would be passed on to the state and local 

governments, and that LEAs would be eligible for impact aid from the 

federal Department of Education. 25 While the study makes various 

assumptions about likely impact aid to LEAs, we are not able to affirm the 

reliability of those estimates based on the data provided. Impact aid is a 

program that is subject to annual appropriations and not an entitlement; 

and, based on our discussions with Department of Education officials, the 

22See footnote 7 on page 5.

23An area of savings from transferring educational responsibility to LEAs would be in 

teacher salaries. The transfer study noted significant differences in teacher salaries 

between DDESS and LEA schools.

24U.S. Department of Education officials told us that making such upgrades had been 

necessary to encourage LEAs to accept transfer of school facilities owned by the 

Department of Education even though the LEAs were already educating dependents in these 

schools.

25LEAs receive federal payments to compensate for the loss in tax revenues due to the 

presence of tax-exempt federal property and increased school enrollments due to federal 

activities.
Page 19 GAO-05-469 DOD Schools

amount of impact aid to which an LEA would be entitled is formula based, 

and not easily calculated in advance. Also, as we note elsewhere in this 

report, various communities surrounding military bases in the United 

States are expected to experience a significant influx of military 

dependents over the next few years as DOD restations many military 

personnel from bases overseas to ones in the continental United States. 

This could place an increased burden on the Department of Education’s 

impact aid program as it distributes resources across more LEAs. In 

addition, states and LEAs would bear an additional burden if impact aid 

funds were not increased. 

The recent study, as did prior studies, found unique circumstances that 

could impact costs and would require resolution on a site-by-site basis, 

should an effort be made to transfer educational responsibilities from 

DDESS to LEAs. For example, Fort Campbell has a large DDESS student 

population, with eight schools in two states, and agreements would have to 

be worked out to permit the students to cross jurisdictional boundaries to 

attend the LEA administered school. In a couple of other instances, DDESS 

schools for an installation may fall within the jurisdiction of two counties 

and special arrangements would be needed to enable students whose onbase residency falls in one county to attend schools in the other county. In 

other instances, the study report noted limitations or caps on numbers of 

students eligible for special education in certain LEAs compared with those 

in DDESS schools that would need to be addressed. Thus, individual 

negotiations at each DDESS location and LEA would be required to address 

these and other issues. 

Other Issues Could 

Impact Decision 

Making

Apart from issues identified in the transfer study, there are other 

factors/issues that were not present when the transfer study began that 

could impact DDESS and LEA schools and further complicate school 

transfer decisions. These factors relate to planned overseas basing 

changes, major force structure changes planned by the Army, the domestic 

base closure process, and DOD efforts to privatize housing.

The study did not consider ongoing DOD plans to realign U.S. bases 

overseas and announced plans to restation about 70,000 military personnel 

and approximately 100,000 family members currently stationed overseas to 

bases in the United States. However, the details on where many of these 

personnel and associated units are likely to be restationed will not be 

known until the 2005 base realignment and closure decisions are made 

later this year. Nevertheless, this rebasing effort could result in significant 
Page 20 GAO-05-469 DOD Schools

increases in populations of various bases with many new students requiring 

education by LEAs. To the extent DDESS programs are affected, this could 

complicate any negotiations with LEAs regarding assumption of on-base 

DDESS programs. Likewise, the extent to which DDESS installations will 

be impacted by the base closure process will not be known until later this 

year.

The study also does not reflect efforts under way by the Army to reorganize 

its force structure, creating new units of action with the potential for 

increased numbers of personnel assigned to selected military bases in the 

United States. A recent Congressional Research Service report summarized 

the magnitude of this effort.26 It noted that, “...in what the Army describes 

as the ‘most significant Army restructuring in the past 50 years,’ the Army 

intends to redesign its current 10 active duty division force to a 43 or 48 

brigade-level unit of action or UA force by FY 2007.” This conversion is 

expected to add over 2,000 personnel to many of these former brigades at 

various installations. A few of these new units of action tentatively have 

been identified for installations in the United States where some DDESS 

schools operate. 

DOD has appropriately said that it is postponing decision making on the 

results of the transfer study until after base closure decisions are finalized 

later this year. Importantly, the transfer study, in examining educational 

expenditures, largely considered the cost impact on LEAs from a potential 

transfer decision on an incremental cost basis. A large influx of students 

into LEA or DDESS schools as a result of the above factors could require a 

fuller assessment of funding and facility needs than provided for in the 

existing study. 

The transfer study partly touched on current DOD efforts to privatize 

housing on its military bases, but study officials recognize that the full 

impact of that initiative was not available for consideration in their report. 

Additionally, DOD housing officials told us that previous plans for housing 

privatization may need to be adjusted as efforts are made to ensure 

adequate housing for the thousands of military personnel scheduled to be 

redeployed to the United States.

26Congressional Research Service, U.S. Army’s Modular Redesign: Issues for Congress, 

(Washington, D.C.: Jan. 6, 2005).
Page 21 GAO-05-469 DOD Schools

Conclusions The transfer study has a number of limitations that present less than a 

clear-cut answer to the feasibility and desirability of transferring 

educational responsibilities from DDESS to LEAs. Moreover, there are 

important issues not addressed in the study such as the anticipated 

restationing of thousands of military personnel and their dependents from 

overseas to U.S. bases, the Army’s planned force restructuring, and the 

domestic base closure process that could stress existing educational 

capacities and require expanded capabilities at affected bases. DOD has 

appropriately said that it is postponing decision making on the results of 

the transfer study until after base closure decisions are finalized later this 

year. Until DOD obtains a fuller understanding of all these plans and time 

frames the likely financial impact on DDESS and LEAs remains unknown. 

Without that assessment, the financial assessment completed by the 

current transfer study is incomplete. Fundamentally, a decision on 

whether to transfer educational responsibilities from DDESS to LEAs is a 

policy decision that requires balancing fiscal, educational, and other quality 

of life considerations. Once the results of the domestic base closure 

process and overseas rebasing plans are known, a decision on the school 

transfer issue should be made sooner rather than later to ensure adequate 

planning, funding and siting of new school facilities in the United States 

that may be needed to support increasing populations of military 

dependent students. Regardless, there needs to be proper accounting for 

the school facilities in federal property records. 

Recommendations for 

Executive Action

Should a decision be made to transfer some or all of DDESS domestic 

schools to LEAs, we recommend that the Secretary of Defense, in 

conjunction with the Under Secretary of Defense for Personnel and 

Readiness require that such efforts be accompanied by a more complete 

assessment of the impact of troop redeployments and other force structure 

changes on educational facility requirements on affected installations and 

surrounding communities to facilitate needed facility and operational 

planning by DOD, the Department of Education and LEAs to meet changing 

needs. Regardless of transfer decisions, we recommend that the Secretary 

ensure DDESS school facilities are properly reflected in DOD’s property 

records and removed from the Department of Education records.

Agency Comments and 

Our Evaluation

In commenting on a draft of this report, the Principal Deputy Under 

Secretary of Defense (Personnel and Readiness) concurred with our 

recommendations. The department’s response indicated that any decision 
Page 22 GAO-05-469 DOD Schools

to transfer educational responsibility to local educational authorities would 

occur after the base closure process is complete and would involve 

consultations with the military services and Congress, and that it is 

working with the Department of Education to ensure school facilities are 

properly recorded in real property records. However, the department took 

exception with the title of our report because it believed we raised issues 

that were related to events occurring after the study began such as the 

formulation of the rebasing plan, which were outside the scope of the 

transfer study. We believe, however, that the title correctly captures the 

limitations of the DOD-sponsored study as both having to do with external 

issues affecting the study that became known after the study began as well 

as limitations with the study that made unclear the basis for the transfer 

recommendations. Therefore, we did not change our title. The department 

separately provided various technical comments which are incorporated 

where appropriate. DOD’s comments are included in appendix VI of this 

report.

Scope and 

Methodology

To determine the extent to which DOD has established a school closure 

policy and the effect such policies have on quality-of-life issues for 

servicemembers and their dependents, we discussed the issue with 

cognizant officials within DODEA and other departmental officials. We 

obtained and reviewed data on DDESS school closures in prior years and 

the basis for those closures, as well as similar information from the U.S. 

Department of Education concerning schools owned by that department 

serving military dependents. We also met with education officials to 

discuss administration of federal impact aid and learn about their 

experience in transferring federally owned schools to LEAs. To obtain 

DOD perspectives concerning the issues of dependent schools as a quality 

of life issue, we obtained and reviewed the Department’s July 2002, 

publication entitled A New Social Compact: A Reciprocal Partnership 

Between The Department of Defense, Servicemembers and Families. The 

document was issued under the auspices of the Deputy Assistant Secretary 

of Defense (Military Community and Family Policy) providing 

departmental perspective on a range of quality of life issues, including 

schools. We contrasted that with information obtained from the 

Department’s Housing and Privatization Office on criteria for considering 

commercial activities performed by the department for potential 

public/private competitions under OMB Circular A-76. Likewise, we 

contrasted that information with other information regarding departmental 

efforts to more rigorously assess what functions are considered core to 
Page 23 GAO-05-469 DOD Schools

warfighting efforts with policy direction to consider those not designated 

for potential outsourcing.

To assess the transfer study completed for DODEA by the Donahue 

Institute, including the clarity of the basis for conclusions reached, the 

overall financial impact, and issues identified but not resolved by the study, 

we first reviewed the various summary reports prepared by the Donahue 

Institute, the results of the facility condition assessment performed by 

Parkhill, Smith, and Cooper, Inc., and a summary of the phase 3 quality-oflife assessment. We discussed the transfer study design and methodology 

with officials of DODEA, the Donahue Institute and two of the three 

members of the panel of experts employed by the institute to review its 

data and to develop study recommendations. Likewise, we also reviewed 

the results of previous transfer studies to understand similarities and 

differences between previous studies and the recent study effort. To assess 

the basis for recommendations made by the expert panel, we examined the 

data developed for the panel’s use that was contained in the Donahue 

Institute’s various study summary documents to try to gauge the basis for 

the recommendations and determine how clearly the recommendations 

were linked to the summary information provided. Given time constraints, 

we did not attempt to validate financial and other quantitative data 

included in the study, but we did review the steps taken by the Donahue 

Institute to verify its data and analysis and to compare some key data 

against other available data sets to corroborate its relative accuracy. We 

also reviewed summaries of interviews completed by the institute with 

leaders in affected DDESS schools and local education agencies to confirm 

and better understand the range of issues associated with the issue of 

potential transfer of the schools to LEAs—as well as similar information 

contained in prior studies. We obtained other relevant statistical data about 

DDESS schools from DODEA and made limited checks to assure ourselves 

that the data was sufficiently accurate for the purposes of our review. 

To frame other issues not addressed in the transfer study that could impact 

decision making regarding the future of DOD’s domestic elementary and 

secondary schools, we relied on insights gained from other ongoing GAO 

assessments in the Defense area that had the potential to impact dependent 

educational requirements on military bases and confirmed our assumptions 

through discussions with cognizant Defense officials.

We conducted this review from January to April 2005 in accordance with 

generally accepted government auditing standards.
Page 24 GAO-05-469 DOD Schools

We are sending copies of this report to the Chairmen and Ranking Minority 

Members, Senate Committee on Appropriations, Subcommittees on 

Defense and Military Construction and Veterans Affairs; Chairmen and 

Ranking Minority Members, House Committee on Appropriations, 

Subcommittee on Quality of Life; Secretaries of Defense, the Army, the 

Navy, and the Air Force; the Commandant of the Marine Corps; the 

Secretary of Education; and the Director, Office of Management and 

Budget. Copies will be made available to others upon request. In addition, 

this report will be available at no charge on our Web site at 

htt://www.gao.gov.

Please contact me at (202) 512-5581, or my Assistant Director, Michael 

Kennedy, at (202) 512-8333 if you or your staff have any further questions 

regarding this report. Major contributors to this report were Maewanda 

MichaelJackson, Hilary Murrish, and R.K. Wild of GAO’s Defense 

Capabilities and Management team, Dr. Nagla’a D. El-Hodiri of GAO’s 

Education and Workforce team, and Julia Matta, Office of General Counsel.

Barry W. Holman, Director

Defense Capabilities and Management
Page 25 GAO-05-469 DOD Schools

Appendix I

Expert Panel Members ApApenednxidexiIs

The DDESS Transfer study completed by the Donahue Institute of the 

University of Massachusetts indicated that the results of its data and study 

component analysis were presented to a panel of three leading national 

experts on educational administration and finance. The study report 

provides the following information regarding the three experts:

• Kern Alexander, Ed.D. Dr. Alexander is a national expert in the field of 

school finance. He is Chair of the Board of Editors for the Journal of 

Education Finance. He served as director of the Institute for 

Educational Finance at the University of Florida, and as Director of the 

National Educational Finance Project while it conducted a nationwide 

study of educational fiscal policy involving all 50 state education 

agencies. He has published numerous books, book chapters and articles 

on school finance. He is currently a professor at the University of 

Illinois at Urbana-Champaign;

• Richard Salmon, Ed.D. Dr. Salmon is a nationally recognized expert in 

the fields of school finance and Federal Impact Aid issues. He is a 

professor at Virginia Tech and has authored numerous textbooks, book 

chapters, and articles on public school finance. Dr. Salmon is a member 

of the Board of Editors for The Journal of Education Finance. He also 

consults for the U.S. Department of Education Bureau of Impact Aid and 

has testified for the department in several federal trials. He served in 

the United States Navy for more than 20 years, retiring as Commander 

from the Naval Reserve; and

• Deborah A. Verstegen, Ph.D. Dr. Verstegen is a national expert in the 

field of school finance. She is a professor of education at the University 

of Virginia, where she teaches a number of courses including 

Educational Finance Policy and Practice, School Finance, and 

Educational Policy Analysis. She has authored many books, book 

chapters, and refereed journal articles and monographs on education 

finance. She is past editor and currently serves on the editorial staff of 

The Journal of Education Finance. She has completed a study of all 50-

state school finance systems for the Education Commission of the 

States, entitled “School Finance at a Glance.”
Page 26 GAO-05-469 DOD Schools

Appendix II

Department of Defense Elementary and 

Secondary (DDESS) Schools in the 

Continental United States ApendxiI

Source: DOD.

a

These consist of 47 elementary schools, 6 middle schools, 1 junior high school, 1 combination 

elementary/middle school, 1 combination middle/high school, and 3 separate high schools. 

b

Transfer study only covered 2 of the three schools; the third school became operational after the study 

was begun.

State(s) 

Affected

Principal Installation(s) 

Served

Number of

Schoolsa

Number of Students as of

January 2005

Adjacent Local Education 

Agency(ies)

Alabama Fort Rucker 2 821 Daleville City Schools

Enterprise City Schools

Ozark City Schools

Alabama Maxwell Air Force Base 1 448 Montgomery County Schools

Georgia Fort Benning 7 2,472 Muscogee County Schools

Chattahoochee County Schools

Georgia Robins Air Force Base 1 398 Houston County Schools

Georgia Fort Stewart 2 1,440 Liberty County Schools

Kentucky/

Tennessee

Fort Campbell 8 4,240 Clarksville-Montgomery County 

Christian County Schools

Kentucky Fort Knox 8 2,784 Hardin County Schools

Meade County Schools

New York U.S. Military Academy, 

West Point

2 772 Highland Falls Central School District

North Carolina Fort Bragg 9 4,352 Cumberland County Schools

South Carolina Fort Jackson 3 715 Richland County School District

North Carolina Camp Lejeune 8 3,243 Onslow County Schools

South Carolina

(Laurel Bay)

Marine Corps Air Station 

Parris Island

Naval Hospital

3b 967 Beaufort County Schools

Virginia Dahlgren Naval Surface 

Warfare Center

1 221 King George County Schools

Virginia Quantico Marine Corps 

Base

4 791 Prince William County Schools

Total 59 23,664
Page 27 GAO-05-469 DOD Schools

Appendix III

Prior Studies on Transferring DDESS Schools 

to LEAs ApendxiI

• A December 1986 study entitled DOD Schools: Funding and Operating 

Alternatives for Education of Dependents, by GAO. Congress, in 

enacting the Military Construction Authorization Act, 1985 (Public Law 

98-407), expressed the view that the exclusive federal responsibility for 

funding and operating the military dependents’ schools might no longer 

be necessary, and directed us to determine the most suitable alternative 

for funding and operating these schools. 

• A July 1988 study entitled The Transfer Of Section 6 Schools:1

 A Case by 

Case Analysis. The study was completed by Rand under the 

sponsorship of the Assistant Secretary of Defense/Force Management 

and Personnel as the result of Congress incorporating into the Military 

Construction Authorization Act, 1986, a request to the Secretary of 

Defense to submit a plan “which provides for the orderly transfer, not 

later than July 1990, of all Section 6 schools to the appropriate local 

school districts of the states in which such schools are located.” DOD 

later reported to the Congress, in December 1988, that based on the 

results of a detailed study of the schools, it had decided to suspend 

efforts to transfer educational responsibilities for the schools to LEAs. 

• A 1991 study entitled Section 6 Schools in Six States: Eleven Case 

Studies of Transfer Issues. This study was also completed by Rand 

under sponsorship of the Assistant Secretary of Defense (Force 

Management and Personnel), as a supplement to the earlier Rand study.

• A March 1995 study entitled Construction, Repair, and Rehabilitation 

Needs of Dependent School Facilities Located on Military Installations 

in the United States. This study was jointly prepared by the DOD and 

the Department of Education. According to the study, it was the result of 

language contained in the House Committee on Appropriations Report 

on the Fiscal Year 1993 DOD Appropriations Bill, Committee Report 

Number 102-627, dated June 29, 1992, which requested DOD and the 

Department of Education to conduct a study to assess: the condition of 

school facilities on military installations in the United States; the 

requirements for remedial maintenance to bring school facilities up to 

an acceptable condition, including meeting applicable building codes; 

the feasibility and desirability of transferring ownership of facilities to 

local school districts that provide educational services at military 

1

Prior to 1981, DDESS schools were referred to as Section 6 schools, which was a reference 

to their funding source at that time under Section 6 of Public Law 81-874.
Appendix III

Prior Studies on Transferring DDESS Schools 

to LEAs

Page 28 GAO-05-469 DOD Schools

installations; and a funding plan for correcting the maintenance backlog 

over the next 5 years and the new construction backlog over the next 10 

years. The study included existing on-base dependent school facilities 

owned by DOD or the Department of Education and operated by DOD 

or LEAs. 

• An October 1997 study entitled A Study of Schools Serving Military 

Families in the U.S.: Education Quality, Federal Administration, and 

Funding. The study was completed by the Survey & Program 

Evaluation Division of the Defense Manpower Data Center. It was 

conducted in response to a request contained in the Conference Report 

on the National Defense Authorization Act for Fiscal Year 1995 (Public 

Law 103-337), asking the Secretary of Defense to collect information 

concerning the possibility of transferring DOD dependent schools to 

local education agencies. The study included results of a survey of 

military parents on the quality of education provided by DOD dependent 

schools and local education agencies and their perspective on the 

transfer issue. 
Page 29 GAO-05-469 DOD Schools

Appendix IV

Transfer Study Rules and Alternatives ApendxiIV

The transfer study notes that “the deeper the study team got into the data 

collection and site visit process, the more evident it became that a limited 

set of universal principles or rules was needed to help all parties achieve 

two important and complementary purposes. The first purpose was to 

assure basic equity and fairness for the students, families and communities 

that might be affected by the outcomes of particular transfer alternatives; 

the second was to assure that the panel of national experts ends up with a 

package of findings and analysis that was sufficiently manageable so it 

could produce its recommendations. It noted that while exceptions might 

be appropriate on a case-by-case basis, applying the following rules to all 

installations helped achieve these dual ends of equity and practicality:

• It would be unfair for some students at the same grade level to transfer 

to the LEA district while other students in the same grade remain on 

base. Therefore, at any installation, any decision affecting one DDESS 

school shall apply to all DDESS schools with the same or overlapping 

grade levels;

• To maintain continuity and effective education, it is not feasible to 

transfer students at a particular grade and then return them to the 

DDESS curriculum at a higher grade. Therefore, if a transfer is made at 

one grade, all succeeding higher grades must transfer as well;

• If a DDESS elementary school with a pre-kindergarten (pre-K) program 

is transferred to an LEA that does not offer a pre-K program, DDESS will 

continue to offer pre-K services, using either on-site or off-site 

resources; and

• It would be both inefficient and detrimental to educational consistency 

to have some DDESS schools run under contract with the LEA while 

others on the same installation do not. Therefore, if a contract or 

coterminous alternative is chosen for any DDESS school, that 

alternative should apply to all schools on the installation.

The study team developed a set of transfer alternatives for consideration 

including:

• Maintaining the status quo, i.e. DDESS schools would continue to 

operate as they have in the past.

• Transfer responsibilities for the educational program to the LEA along 

with facilities being used by DDESS. The LEA would accept full 
Appendix IV

Transfer Study Rules and Alternatives

Page 30 GAO-05-469 DOD Schools

responsibility for educating military children and for the future upkeep 

of the facilities. It assumed the installation school facilities would be 

brought up to LEA maintenance and building standards prior to LEA 

occupancy.

• Transfer without facilities. DDESS students would transfer to the 

neighboring LEA and integrated into the existing school facilities.

• Contract with the LEA to provide educational services on the 

installation.

• Create a public school district within the installation, coterminous with 

its existing boundaries (coterminous alternative). Under that 

assumption, all DDESS schools on base would be included in the newly 

created LEA. DOD would provide the LEA with title of DDESS facilities 

(except where noted otherwise), and buildings and facilities would be 

brought up to LEA standards before being transferred to the LEA.

These were similar to alternatives considered in some prior studies. 
Page 31 GAO-05-469 DOD Schools

Appendix V

Differing Perspectives on Selected DDESS 

and LEA Schools Contained in Various 

Transfer Study Report Documents ApendxiV

The DDESS Transfer Study Report prepared by the Donahue Institute with 

its supporting data is contained in multiple binders. The recommendations

report, prepared by the panel of experts, are contained in a binder 

sometimes referred to as the “green book”. Underpinning that were 

additional binders prepared by the Donahue Institute staff. They included

a so-called book of narratives—referred to as the “white book”--providing 

an overview of each domestic DDESS school and adjacent LEAs. 

Additional information on individual DDESS schools and adjacent LEAS is 

contained in multiple “blue binders” summarizing financial, performance, 

and data on the educational quality of individual schools. Additional 

financial information is then contained in multiple “yellow binders” labeled 

appendixes.

Our examination of individual recommendations and supporting 

information provided in individual study binders sometimes provided what 

appeared to be divergent pictures of school performance, quality, and cost 

factors that did not always fully comport with information contained in the 

recommendations report. Below are key examples.

Fort Benning The Recommendations Report suggests transferring 

responsibility for schools to Chattahoochee County vice Muscogee County 

(five of seven DDESS schools are within Chattahoochee County). It noted 

that installation officials had expressed concerns about quality of 

Chattahoochee County Schools, but noted DDESS students would 

represent the vast majority of student enrollment within the LEA. It 

expected that most students would still be educated on base and most 

teachers still have opportunity to teach. It said the pupil-teacher ratios and 

the per pupil expenditures of the DDESS and Chattahoochee County are 

already comparable (GAO note: data suggest less comparability in costs 

than stated here). 

The White Book points out that salaries and benefits make up 90 percent, 

86 percent, and 84 percent of the Fort Benning DDESS, Chattahoochee 

County, and Muscogee County school budgets. The White Book indicates 

per pupil expenditures of approximately $8,244, $7,345, and $5,956 for Fort 

Benning DDESS, Chattahoochee County, and Muscogee County 

respectively.

The White Book points out that Fort Benning DDESS students test results 

ranged from the 52nd to 65th percentile for grades 3, 5, and 8. Chattahoochee 

County and Muscogee County test scores were mostly above predicted 

scores for grades 3, 5, and 8.
Appendix V

Differing Perspectives on Selected DDESS 

and LEA Schools Contained in Various 

Transfer Study Report Documents

Page 32 GAO-05-469 DOD Schools

The Blue Book shows that four of the Benning DDESS schools were 

deemed underperforming and three overperformed. It confirms Muscogee 

test scores were mostly deemed over performing for 5th grade but some 

underperforming for 8th grade, while Chattahoochee’s were deemed 

underperforming for 8th grade. 

Fort Campbell The Recommendations Report suggests transferring 

responsibility for schools to LEA, Christian County versus ClarksvilleMontgomery County. The report notes that considering all factors, 

Christian County, Kentucky has higher quality measures than ClarksvilleMontgomery County, Tennessee. 

The White Book notes salaries and benefits make up 88 percent, 64 percent 

and 64 percent respectively of the Fort Campbell DDESS, and ClarksvilleMontgomery County and Christian County school budgets. Fort 

Campbell’s per pupil expenditure, which is projected to be about $7,962 in 

fiscal year 04, has been rising in recent years due to increasing costs and 

decreasing enrollment (reason for decreasing enrollment not indicated). 

Clarksville-Montgomery’s per pupil expenditure in fiscal year 2004 is $5,166 

but will decline because of recent budget cuts. Christian County’s per pupil 

cost is about $ 6,589 in fiscal year 2004 but notes escalating salary costs 

coupled with relatively stable enrollment will likely lead to increased per 

pupil expenditure.

The White Book indicates that Fort Campbell DDESS students performed 

at or above the 60th percentile for most subjects and grades. Performance of 

LEA schools of both districts was mixed. Clarksville-Montgomery matched 

or exceeded predicted scores in seven of nine instances cited. The 

Christian County matched or exceeded in five of nine instances cited. 

However, the White Book also notes that Fort Campbell schools have a 

lower student-to-teacher ratio than either LEA and have a higher 

percentage of DDESS teachers (82 percent) with advanced degrees than 

Christian County (68 percent), or Clarksville (52 percent). 

The Blue Book rates Fort Campbell schools as mixed in terms of over or 

under performing. Same was true for Christian County schools. The Blue 

Book rates Clarksville-Montgomery County schools as primarily 

underperforming. 

Fort Jackson The Recommendations Report suggests status quo notes 

reductions in state funding of education over recent two years. It notes 

that Richland County’s schools are already over capacity, and the LEA has 
Appendix V

Differing Perspectives on Selected DDESS 

and LEA Schools Contained in Various 

Transfer Study Report Documents

Page 33 GAO-05-469 DOD Schools

little physical room to expand its facilities. (GAO note: Why this is a 

discriminating factor is unclear since most transfer recommendations are 

based on use of DDESS schools.) The Green Book also notes that “a 

transfer to the LEA could jeopardize the quality of education now received 

by students at Fort Jackson, who, as mostly younger students, would face 

substantial disruption of educational services in the event of a transfer.” 

(GAO note: report is not clear why younger students at Jackson would 

face substantial disruption yet the same issue is not raised in most other 

transfer recommendations.) 

The White Book notes that because Fort Jackson does not track salaries 

and benefits for each type of school employee, salaries and benefits were 

allocated based on the teaching roster and an average salary and benefit 

expenditure. School costs were not laid out comparably to those at other 

installations. However, it projects approximately 90 percent, 73 percent of 

Fort Jackson DDESS and LEA budgets respectively to be spent on salaries 

and benefits. It indicated there was per pupil expenditures of $10,700 for 

DDESS versus $6,165 for LEA.

The White Book shows Fort Jackson scores on Tera Nova tests scores 

reported were lower than recorded for many other DDESS systems for 

grades 3 and 5. LEA schools were shown in the White Book as exceeding 

predicted test scores for grades 3 and 5.

The Blue Book does not contain school level testing for Fort Jackson 

schools so doesn’t indicate whether they were viewed as over or under 

performing. It shows LEA mixed in terms of over or under performing for 

grade 6 but over performing for grade 8 (at one school).

Fort Knox The Recommendations Report recommends transferring 

responsibility to adjacent LEA, Hardin County, versus LEA Meade County. 

However, the report notes that while the level of education quality 

indicators for the two LEAs is generally comparable, Hardin County’s per 

pupil expenditure exceeds that of Meade County in the instructional area. 

This indicates Hardin County is larger and more capable than Meade 

County to absorb DDESS students, and the executive leadership of Hardin 

County appeared more receptive to a transfer of DDESS students. The 

White Book indicates Hardin is geographically closer to installation 

housing and because of this proximity, Hardin has a closer relationship 

with Fort Knox.
Appendix V

Differing Perspectives on Selected DDESS 

and LEA Schools Contained in Various 

Transfer Study Report Documents

Page 34 GAO-05-469 DOD Schools

The White Book projects that 88 percent, 78 percent, and 75 percent of Fort 

Knox DDESS, Meade County and Hardin County LEAs school budgets 

respectively were spent on salaries and benefits. This indicated per pupil 

expenditures of $8, 454 for DDESS versus $5,108 in Meade County, and 

$5,493 in Hardin County.

The White Book shows Fort Knox students scored above the 50th 

percentile for all subjects and grades in Terra Nova testing. At the same 

time, the performance information provided indicated that many Hardin 

County grades scored lower than predicted on testing, while Meade County 

grades nearly always scored higher than predicted.

The Blue Book indicates that Fort Knox DDESS schools presented a mixed 

picture in terms of over or under performing on performance tests. At the 

same time, all Hardin County schools were cited as underperforming in 

testing for grades 3 and 6 and over for one school with grade 9 scores; at 

the same time, while Meade County schools were identified as over 

performing for grades 6 and 9.

West Point The Recommendations Report suggests transferring 

responsibility to LEA, Highland Falls Central School District, but grades 

PK-4 remain in the current school. The report notes that in this case, the 

LEA had a higher per pupil expenditure and a lower pupil-teacher-ratio 

than DDESS, both of which are quality indicators. The report said the 

recommendation for transfer was due, in part, to the fact that the middle 

school facility needs to be replaced immediately.

The White Book projects that 84 percent and 76 percent of West Point 

DDESS and Highland Falls school budgets respectively were spent on 

salaries and benefits. However, it notes that the LEA’s budget has seen 10 

percent growth, with costs for health and liability insurance and special 

education and retirement system costs rising. It also indicated per pupil 

expenditures of $10, 957 for West Point DDESS (among the highest of all 

DDESS districts mainly due to salaries) and $11,196 for Highland Falls. It 

notes that this is the only district where the per pupil expenditure is greater 

than the corresponding DDESS per pupil expenditure.

The White Book shows West Point DDESS schools scored in the 70-80th

percentiles in Tera Nova testing. Conversely, Highland Falls Schools 

indicated almost all (three of four) test scores were lower than predicted.
Appendix V

Differing Perspectives on Selected DDESS 

and LEA Schools Contained in Various 

Transfer Study Report Documents

Page 35 GAO-05-469 DOD Schools

The Blue Book indicates that West Point DDESS schools over performed 

on performance tests while Highland Falls schools were mostly cited as 

underperforming.
Page 36 GAO-05-469 DOD Schools

Appendix VI

Comments from the Department of Defense ApendxiVI
Appendix VI

Comments from the Department of Defense

(350631) Page 37 GAO-05-469 DOD Schools
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