United States General Accounting Office

GAO Report to Congressional Requesters

January 1998 BEST PRACTICES

Elements Critical to

Successfully Reducing

Unneeded RDT&E

Infrastructure

GAO/NSIAD/RCED-98-23

GAO United States

General Accounting Office

Washington, D.C. 20548

National Security and

International Affairs Division

B-277529 

January 8, 1998

The Honorable Sam Brownback

Chairman, Subcommittee on Oversight of Government

 Management, Restructuring and the District of Columbia

Committee on Governmental Affairs

United States Senate

The Honorable John R. Kasich

Chairman, Committee on the Budget

House of Representatives

In response to your request, we reviewed a number of issues related to the federal government’s

research, development, test, and evaluation (RDT&E) infrastructure. We briefed your staffs

previously and this report contains the final results of our review.

This report, in laying out a framework within which changes to the federal RDT&E infrastructure

can be accomplished and around which debate about the need for those changes can occur,

(1) examines the condition of existing infrastructure, (2) analyzes the approaches used by

organizations outside of the federal government to realign RDT&E infrastructure, and

(3) compares those approaches to federal agency efforts. This approach, if implemented fully by

federal agencies, could help focus agencies’ efforts in research and development, reduce

unneeded infrastructure governmentwide, and free up resources necessary for scientific

programs and related equipment.

We are sending copies of this report to other interested congressional committees and the

Secretaries of Agriculture, Commerce, Defense, Education, Energy, Health and Human

Services, Interior, Justice, State, Transportation, Treasury, and Veterans’ Affairs. We also are

sending copies to the Secretaries of the Army, the Navy, and the Air Force; the Director, Office

of Management and Budget; the Director, Centers for Disease Control and Prevention; the

Director, Drug Enforcement Administration; the Director, Environmental Protection Agency;

the Director, Food and Drug Administration; the Administrator, National Aeronautics and Space

Administration; the Director, National Institutes of Health; the Director, National Science

Foundation; the Director, Nuclear Regulatory Commission; the Director, Office of Personnel

Management; the Director, Office of Science and Technology Policy; the Director, Smithsonian

Institution; and the Director, Tennessee Valley Authority. We will make copies available to

other interested parties upon request.
B-277529 

This report was prepared under the direction of Katherine V. Schinasi, Associate Director,

Defense Acquisitions Issues, who may be reached on (202) 512-4841 if you or your staff have

any questions. Other major contributors to this report are listed in appendix V.

Louis J. Rodrigues

Director, Defense Acquisitions Issues

National Security and

 International Affairs Division

Victor S. Rezendes

Director, Energy, Resources, and Science Issues

Resources, Community, and

 Economic Development Division

Page 2 GAO/NSIAD/RCED-98-23 Federal Laboratory Infrastructure
Executive Summary

Purpose The federal research, development, test, and evaluation (RDT&E)

establishment is in transition. The missions of its research and

development (R&D) laboratories and test and evaluation (T&E) centers are

being redefined within a changed environment while these agencies

compete for scarce federal resources. As future pressures to reduce

discretionary spending increase, a greater share is devoted to operating

and maintaining an aged, inefficient, and costly infrastructure at the

expense of research and development.

In an effort to identify alternatives for achieving cost-saving efficiencies

while maintaining high quality research and development, the former and

current Chairmen of the Subcommittee on Oversight of Government

Management, Restructuring and the District of Columbia, Senate

Committee on Governmental Affairs, and the Chairman of the House

Committee on the Budget asked the U.S. General Accounting Office (GAO)

to review a number of issues related to the federal RDT&E infrastructure.

GAO (1) examined the condition of existing infrastructure, (2) analyzed

approaches used by organizations outside of the federal government to

realign RDT&E infrastructure, and (3) compared those approaches to

federal agency efforts.

GAO focused on efforts by the Departments of Energy and Defense and the

National Aeronautics and Space Administration (NASA) to streamline their

RDT&E infrastructure because they represent about 72 percent of all federal

investment in research and development and own most of the RDT&E

infrastructure. This report lays out a framework within which changes to

the federal RDT&E infrastructure can be accomplished and around which

debate about the need for those changes can occur.

Background For fiscal year 1997, the U.S. Congress appropriated $72 billion for the

conduct of federal research and development (including Defense

Department test and evaluation), about 14 percent of federal discretionary

spending. Although that amount is expected to increase slightly in fiscal

year 1998, budget projections indicate a decline in the future.

Twenty-two federal agencies receive R&D funding, and 17 of them own 514

R&D laboratories and T&E centers. These RDT&E facilities support six

fundamental research areas: national security, health and safety, energy

security, environmental protection and cleanup, industrial

competitiveness, and fundamental science. Much of the R&D funding the

Congress provides to agencies is passed on to laboratories that other

Page 3 GAO/NSIAD/RCED-98-23 Federal Laboratory Infrastructure
Executive Summary

agencies, universities, or the private sector operate. For example, the

Department of Energy carries out over $1 billion in research and

development for other agencies each year and its three weapons

laboratories receive more than one-half of their R&D funding from the

Defense Department as “work for others.” Thus, agencies’ research

activities often are intertwined. The Research and Development in the

United States (RaDiUS) database, newly created by The RAND

Corporation’s Critical Technologies Institute, compiles systematically data

on the conduct of federal R&D investments. A review of RaDiUS database

activities raises concerns that duplication within and across agencies may

be prevalent and identifies opportunities for collaborations that are being

missed.

The end of the Cold War and budget constraints led to calls to streamline

federal organizations, including the RDT&E establishment, eliminate

unneeded infrastructure, and reduce costs. In response, federal agencies

have undertaken some actions. For example, the Office of Science and

Technology Policy and the Office of Management and Budget have

engaged the Departments of Energy and Defense and NASA in internal

reviews of RDT&E infrastructure. While the Departments of Energy and

Defense and NASA have conducted intra-agency reviews and reduced

personnel levels, they have made only limited reductions in RDT&E

infrastructure.

Results in Brief The Departments of Energy and Defense and NASA have attempted to

reduce their excess laboratory capacity and associated costs, but could

achieve even further reductions in their RDT&E infrastructure. In recent

years, more than 150 studies, panels, commissions, task forces, and GAO

reports have cited excess capacity, poor maintenance, duplicative

activities, and the failure of the federal RDT&E establishment to adapt

missions and programs to the changing world environment. For example,

according to the 1995 Task Force on Alternative Futures for the

Department of Energy National Laboratories (the Galvin Task Force),

Energy’s laboratory infrastructure was oversized for its existing mission

and its productivity was lagging. In addition, even though the Defense

Department will have closed 62 RDT&E sites and activities at host sites after

implementing fully all four base realignment and closure (BRAC) rounds, a

1995 Defense Department estimate indicates the Department still will have

an estimated 35-percent excess capacity in its laboratories and an

estimated 52-percent excess capacity in its T&E centers in the air vehicles,

electronic combat, and armaments/weapons areas. While NASA closed a

Page 4 GAO/NSIAD/RCED-98-23 Federal Laboratory Infrastructure
Executive Summary

number of individual sites and facilities in recent years, it has yet to

consolidate or close any of its major laboratory facilities. All of the

individual agency actions were taken independent of one another and, to

date, have resulted in limited infrastructure reductions and cost savings.

Little success has been achieved in attempts to consolidate federal RDT&E

infrastructure across agency boundaries.

The federal sector is not alone in its need to reduce RDT&E infrastructure in

response to fiscal constraints and a changing world environment. In recent

years, corporate and foreign government organizations have restructured

successfully their laboratory operations to achieve cost-saving efficiencies.

GAO examined restructuring efforts by two organizations—the Boeing

Company Defense & Space Group (recently renamed the Boeing Company

Information, Space, & Defense Systems Group) and the Defence Research

Agency within the British Ministry of Defence—both of which reduced

substantially their laboratories’ infrastructure and costs. Officials

responsible for those successful efforts identified five critical elements

that were key to their success. The elements were (1) a “crisis” that served

as a catalyst to spark action; (2) an independent authority to overcome

parochialism and political pressures that impede decision-making; (3) core

RDT&E missions focused to support the organizations’ overall goals and

strategies; (4) clear definitions that delineate fully the existing

infrastructure needed to support those missions; and (5) accurate, reliable,

and comparable data that capture total infrastructure costs and utilization

rates for each affected activity. They further asserted that their success

depended on the use of all five elements in concert.

Many of the elements that made the Boeing Company Defense & Space

Group’s and the Defence Research Agency’s laboratory consolidations a

success generally are lacking in U.S. federal agencies’ efforts. In general,

budgetary concerns have not, to date, created a catalyst to focus and

redefine missions and then reduce the supporting RDT&E infrastructure

within the Departments of Energy and Defense and NASA. The missions of

R&D laboratories and T&E centers are being redefined as agencies compete

for scarce federal resources. Without concurrent reductions in

infrastructure, this perpetuates excess capacity and contributes to the

retention of old, poorly maintained facilities. Moreover, agencies are not

collecting the information they need to assess the full scope and cost of

their RDT&E infrastructure. Further, there has been little effort to address

mission and infrastructure issues across agencies. According to U.S.

officials that direct federal RDT&E activities, in some cases resistance to

inter- and intra-agency restructuring of RDT&E activities has stymied the

Page 5 GAO/NSIAD/RCED-98-23 Federal Laboratory Infrastructure
Executive Summary

thrust of recent streamlining efforts. The one exception, noted in this

report, is the Defense Department’s Vision 21 process, a 5-year plan

directed by the Congress to consolidate and restructure the Defense

Department’s R&D laboratories and T&E centers. The Vision 21 process

sought to incorporate an independent authority and comprehensive

analyses of full operating costs along with the relatively strong mission

focus of its RDT&E infrastructure.

Balancing the federal RDT&E infrastructure with current and future

missions is a complex problem that has proven intractable largely because

of the limited scope of past efforts. Individual agency initiatives have

produced some results and while such efforts to achieve management

efficiencies should continue, they also need to proceed within the context

of a more complete understanding of governmentwide implications. GAO’s

review shows that independent agency efforts have not been sufficient to

date to accomplish the level of improvements warranted. An

independently directed approach to governmentwide restructuring by

looking at the RDT&E infrastructure of individual agencies in support of the

government’s broader strategies and missions has not been attempted.

Principal Findings

Agencies Have Not

Reduced Infrastructure in

Line With Changing

Missions

The energy crisis of the 1970s, the end of the Cold War in the late 1980s,

the desire for a smaller and more efficient government, and the agreement

to achieve a balanced budget by fiscal year 2002 have provided the

impetus to change federal RDT&E missions. More than 150 reports cited the

need for the Departments of Energy and Defense and NASA to improve

efficiency and effectiveness at their RDT&E facilities. Some studies

addressed the need to ensure that changing activities are tied closely to

core missions and noted that to do so, in many cases, would result in

RDT&E infrastructure reductions.

The President’s National Science and Technology Council concluded in its

1995 Interagency Federal Laboratory Review Final Report that, given

post-Cold War conditions and fiscal restraints, the Departments of Energy

and Defense and NASA must downsize and restructure RDT&E facilities,

define laboratory missions more clearly, manage laboratories better, and

eliminate needless redundancies. Further,

Page 6 GAO/NSIAD/RCED-98-23 Federal Laboratory Infrastructure
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• The Galvin Task Force reported that Energy’s facilities could be

restructured productively by eliminating obsolete and redundant missions

and supporting infrastructure.

• Although it did not make specific consolidation recommendations for NASA

infrastructure, the 1995 NASA Federal Laboratory Review (the Foster Task

Force) reported that it found major areas of “duplication of capabilities.”

NASA, recognizing its excess capacity, developed plans to consolidate and

close some of its facilities to reduce its RDT&E infrastructure, setting a

“stretch” goal to decrease the current replacement value of its facilities by

25 percent by the end of fiscal year 2000.

• The Defense Department’s 1995 Directions for Defense: Report of the

Commission on Roles and Missions of the Armed Forces identified many

opportunities to integrate activities across service lines rather than RDT&E

infrastructure reduction.

• The March 1997 Status of Federal Laboratory Reforms, prepared as an

update to the National Science and Technology Council report, recognizes

improvements but cites a continued need for reform.

Despite these and other reports citing the need for reductions, the three

agencies still maintain excess, aging, and deteriorating RDT&E

infrastructure that they find increasingly difficult to maintain and support.

As of 1993, more than one-half of federal laboratory floor space was over

30 years old, some of it ill-equipped for today’s R&D activities. For example,

many of Energy’s older R&D laboratories were not designed to meet today’s

(1) need for precise measurements by considering factors like

temperature, humidity, and vibrations and (2) health and safety code

requirements. NASA’s planned $2.8 billion reduction in the current

replacement value of its facilities may only result in about $250 million in

operations and maintenance cost reductions through fiscal year 2000.

Moreover, the maintenance of excess infrastructure, while at the same

time modernizing other infrastructure, may lead to higher operational and

repair costs. Long-standing backlogs of the maintenance and repair of

Defense Department R&D facilities have reportedly worsened as required

upkeep and modernization are deferred. The lack of repair of aged

facilities may reflect the realities of recent deficit reduction efforts and

associated funding priorities. In addition, excess capacity and aged

facilities in Energy, for example, may continue to exist because facilities

suffer from toxic contamination that cannot be disposed of currently or is

too costly to decontaminate and decommission.

Page 7 GAO/NSIAD/RCED-98-23 Federal Laboratory Infrastructure
Executive Summary

Common Elements Were

Used in Successful

Downsizing

The Boeing Company Defense & Space Group and the Defence Research

Agency restructured successfully their laboratory operations by using five

critical elements. According to officials managing these restructurings,

their success depended on using all five of the elements in concert.

As a result, the Boeing Company Defense & Space Group reduced the

number of its laboratories from 456 to 133 in about 4 years, reduced square

footage requirements significantly, and saved about $100 million in

operating costs. Similarly, the British Ministry of Defence reorganized its

four research establishments into a single agency, reduced the number of

laboratories from 54 to 35, and reduced overhead costs by more than

$100 million.

In the Boeing Company Defense & Space Group and the Defence Research

Agency restructuring efforts, respectively, “crises” that served as catalysts

to spark change were a refocused strategic plan for the parent

organization and a shift in national economic priorities coupled with the

likelihood of severe budget cuts. In each case, an independent authority

outside of the organizations’ normal decision-making chain-of-command,

free from parochial or political pressures, was instrumental in

precipitating change and ensuring the efficiency and integrity of data

collection and analysis. At the Boeing Company Defense & Space Group,

this authority reported directly to the company’s president, and at the

Defence Research Agency, the authority reported to the Secretary of State

for Defence. Additionally, both organizations (1) developed core missions

and aligned them with their customers’ needs, (2) determined what

infrastructure they had and how it supported their missions, and

(3) collected accurate, reliable, and comparable data about their facilities

across-the-board to reduce confusion, prevent facility officials from

claiming they should be exempted from restructuring, and reduce their

assertions that the facilities were “unique” or “incomparable.”

With this information, both organizations were able to determine how best

to restructure their programs and activities and reduce their infrastructure

and its costs.

Critical Elements Were Not

Present in Recent Attempts

to Reduce Federal RDT&E

Infrastructure

The Departments of Energy and Defense and NASA have attempted to

reduce their excess laboratory capacity and associated costs generally by

conducting intra-agency reviews, reducing personnel levels, and making

limited reductions in RDT&E infrastructure. However, these agencies

generally have not taken the steps necessary to ensure success and few of

Page 8 GAO/NSIAD/RCED-98-23 Federal Laboratory Infrastructure
Executive Summary

the critical elements used in successful consolidations we reviewed have

been applied. For example, to date, no catalyst to spur action, such as

budgetary constraints imposed on agencies, has proven to be sufficient

impetus for a major restructuring of federal RDT&E facilities.

Although the Office of Science and Technology Policy and the Office of

Management and Budget have engaged the Departments of Energy and

Defense and NASA in internal reviews, no independent authority has

undertaken a structured approach for streamlining the overall federal

RDT&E infrastructure, that is, looking at the infrastructure of individual

agencies in support of the government’s broader strategies and missions.

In addition, individual agency efforts have been limited. For example, the

September 1997 plans submitted by these agencies as mandated by the

Government Performance and Results Act of 1993 (the Results Act) did

not use cross-agency criteria for assessing missions as required by the

Results Act. Further, GAO found that agency officials have few incentives

or insufficient authority to make significant and far-reaching changes or to

implement the recommendations contained in a number of studies that

have addressed this issue.

Structural barriers, along with parochialism, have kept the Energy

Department from translating changes in mission to reductions of its

existing RDT&E infrastructure. For example, although the Energy

Department established a Laboratory Operations Board to streamline its

laboratory infrastructure, in its current study, the Board is not evaluating

any of the larger, multipurpose laboratories that offer the greatest

opportunity to reduce unneeded and duplicative RDT&E infrastructure. The

Defense Department achieved only limited results in trying to reduce

RDT&E infrastructure through the 1995 BRAC round because, due to service

parochialism, the services would not agree on cross-service reviews of the

capabilities of R&D laboratories and T&E centers together. In fiscal year

1996, the Defense Department and NASA agreed to form six test facilities

alliances in an attempt to work together more efficiently and effectively.

However, in one of the few attempts to address interagency redundancies,

the Defense Department and NASA excluded certain infrastructure from

review and asserted that the existing infrastructure was, in general, the

minimum they needed to sustain the technology base. Thus, no significant

reductions were achieved.

Since each agency, in essence, operates its RDT&E activities independently,

the conditions for overlap and duplication are prevalent. In some cases,

agencies’ new missions and objectives brought them into competition.

Page 9 GAO/NSIAD/RCED-98-23 Federal Laboratory Infrastructure
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Both NASA and the Air Force have test centers that are competing with

each other to test the engines for a space launch system. Also, some

Energy Department laboratories are competing with private industry, for

example, by building facilities to produce medical isotopes.

Neither the Energy Department nor NASA has conducted a full, rigorous

inventory of its RDT&E infrastructure or its costs. In fact, NASA’s

infrastructure current replacement value increased by about 14 percent

between fiscal years 1990 and 1995, indicating that NASA was building new

facilities faster than it was consolidating or closing older ones. Although

the Defense Department was required to delineate fully the scope of its

RDT&E infrastructure during four previous BRAC rounds, it has not yet

determined the true costs of operating its RDT&E facilities because

available cost data and information on utilization rates are considered

inaccurate and unreliable.

Ongoing Approaches in the

Restructuring Process

Some individual agencies have developed initiatives that incorporate some

of the elements necessary for restructuring successfully their RDT&E

infrastructures, but none have implemented them fully. For example:

• The Defense Department developed Vision 21, a 5-year plan directed by

the Congress to consolidate and restructure the Defense Department’s R&D

laboratories and T&E centers. Significantly, the Vision 21 process included

a request to the Congress for an independent authority (like that of the

defense base closure and realignment commissions) as the key

implementing mechanism. However, the Department now asserts that,

based on the results of the broader Quadrennial Defense Review,

implementation of the Vision 21 plan should be incorporated into future

BRAC rounds.

• NASA, which has identified infrastructure cuts as a potential source of cost

reductions, recently began an effort designed to improve the reliability of

data needed to determine its RDT&E infrastructure costs. It remains to be

seen whether this effort will reach fruition.

• NASA and Defense Department alliances are working to better coordinate

RDT&E activities in several categories of major test facilities. However,

reducing the infrastructure has not been explicitly stated as an expected

outcome of better coordination. Further, NASA and Defense Department

cooperative activities under the alliances have been limited and several

have not yet convened.

Page 10 GAO/NSIAD/RCED-98-23 Federal Laboratory Infrastructure
Executive Summary

• The Office of Science and Technology Policy recently established the

National Science and Technology Council Interagency Working Group to

review barriers to and broaden federal laboratory reform.

These efforts, although helpful, fall short of the elements found in the

models.

Observations The RDT&E infrastructure problem is long-standing, complex, and

controversial. Balancing the federal RDT&E infrastructure with current and

future missions is a complex problem that has proven intractable largely

because of the limited scope of past efforts. Even in the current climate of

pressure to reduce discretionary spending, budget reductions have not

served as a catalyst for reductions.

Ongoing individual agency initiatives are helpful but will not likely be

sufficient to accomplish significant improvements. Additional efforts

across federal agencies would offer a more meaningful solution. The

critical elements of the models GAO analyzed, when compared to ongoing

efforts in the federal government, suggest approaches that could prove

successful if implemented fully.

Consensus must be reached between the Congress and the administration

that significant changes in the RDT&E infrastructure would better position

the RDT&E complex to support current and future science priorities through

a more efficient and rational RDT&E infrastructure. Developing the

foundation necessary to support an RDT&E infrastructure restructuring

process across the government could begin in the executive branch with

two agencies: (1) the Office of Science and Technology Policy, which has

technical cognizance across the federal RDT&E arena but no direct means

to effect change, and (2) the Office of Management and Budget, which is

responsible for helping to maintain effective government by reviewing the

organizational structure and management procedures of executive branch

agencies and developing efficient coordinating mechanisms to implement

government activities and expand interagency cooperation. However, the

Office of Management and Budget, in responding to a draft of this report,

said that it prefers continuance of the current agency-by-agency

approaches until they are completed.

Ultimately, however, many of the structural and other barriers that exist

between agencies go beyond those found at the agency level. Initiating a

governmentwide process that includes all five model elements in concert

Page 11 GAO/NSIAD/RCED-98-23 Federal Laboratory Infrastructure
Executive Summary

could mitigate virtually all of the parochial concerns that stymied past

efforts to restructure. Establishing an independent decision-making

authority could ensure that all elements of the process are administered

fairly. In implementing the process described in the model, such an

authority could benefit from information developed through ongoing

initiatives, such as proper implementation of the Results Act, to help

coordinate missions and goals of individual agencies that are involved in

crosscutting program areas and balancing individual agencies’ multiple

strategic goals. An independent authority also could benefit from lessons

learned during the federal government’s past uses of independent

authorities, such as the defense base closure and realignment

commissions, and from activity and budget details about research and

development accumulated in the RaDiUS database.

The need to reduce RDT&E infrastructure in balance with mission

requirements is a long-standing and complex issue. Agency efforts to date,

while encouraging in some cases, are too narrowly focused and likely will

promote or sustain duplication and excess capacity. Further, many of the

elements employed as best practices by other organizations are neither

integral nor readily available to federal agencies. Thus, a governmentwide

approach, which could focus both within and across agencies, may offer a

viable alternative and increase the likelihood of successfully reshaping the

nation’s RDT&E infrastructure to meet current and future needs. While

agencies should be encouraged to continue ongoing efforts to improve

efficiencies in the management of RDT&E infrastructure, emphasizing

interagency approaches could be a significant improvement in this arena.

Matters for

Congressional

Consideration

To help craft a more efficient structure to support future federal RDT&E

efforts, the Congress may wish to begin a process to reduce the federal

RDT&E infrastructure that applies collectively the critical elements

identified in this report. This process could be designed to look both

within and across agencies to eliminate unnecessary mission overlap and

duplication and the resulting excess infrastructure capacity. Lessons

learned from the federal government’s past uses of independent, external

authorities could be used to structure this process. Ongoing restructuring

efforts of the agencies could be assessed for their potential to contribute

to overall RDT&E infrastructure restructuring. The RaDiUS database could

provide preliminary inputs indicating possible duplication of effort. The

Government Performance and Results Act of 1993 provides an established

legislative framework that addresses agencies’ missions and performance

Page 12 GAO/NSIAD/RCED-98-23 Federal Laboratory Infrastructure
Executive Summary

and may be useful in focusing specifically on crosscutting agency missions

that determine the requirements for RDT&E infrastructure.

Recommendations GAO is making no recommendations in this report.

Agency Comments

and GAO’s Evaluation

Specific comments from the Office of Management and Budget, Energy

Department, NASA, and the Defense Department and GAO’s evaluation of

them have been incorporated throughout this report. Office of

Management and Budget, Energy Department, NASA, and Defense

Department comments are reprinted in appendixes I, II, III, and IV,

respectively.

All four agencies indicated that the report did not give sufficient credit for

actual, ongoing, and planned infrastructure reductions they have

undertaken. To illustrate further the infrastructure reduction steps the

agencies have initiated, GAO has added information that recognizes other

agency plans and activities.

Although the agencies acknowledge that they need to reduce further their

infrastructure, there was no universal view expressed as to how to effect

significant change in the federal RDT&E infrastructure. For example, while

each of the four agencies recognized the importance of mission focus in

their comments, they had varying perspectives regarding the efficacy of

the model’s other critical elements. For example, the Department of

Energy does not believe a “crisis” is needed to spur action, stating that

changing missions and budget reductions provide the external pressure

needed to get change. NASA agreed with the need for accurate and reliable

data about the true cost of operating RDT&E facilities and pointed out that it

is developing an integrated financial management system to gather such

data. The Department of Defense agreed with GAO’s conclusion regarding

the need for an independent, BRAC-like authority to effect significant

change. The Department of Energy and NASA, on the other hand, believe

they can make, or have already made, appropriate changes regarding the

future strategies for their RDT&E infrastructure. Lastly, the Office of

Management and Budget believes each agency should rationalize

individually its infrastructure before a more complex interagency

approach is attempted. The Office of Management and Budget agrees,

however, that an interagency approach is needed. With respect to defining

fully the scope of the RDT&E infrastructure, the agencies comments’ largely

were silent.

Page 13 GAO/NSIAD/RCED-98-23 Federal Laboratory Infrastructure
Executive Summary

After reviewing carefully the agencies’ comments, GAO believes that the

comments generally reflect the parochialism and structural and

organizational barriers discussed in the report. For example, when the

agencies’ comments discussed planned RDT&E infrastructure reductions,

those plans were limited in scope and focused exclusively on internal

reductions. While acknowledging, in some cases, overlapping capability

and excess capacity in RDT&E infrastructure, Departments of Energy and

Defense and NASA comments generally reflect their belief that (1) their

missions and associated infrastructure are unique, (2) they have planned

to do enough restructuring and consolidation on their own, and (3) they

already coordinate among agencies to the maximum extent practicable.

The Office of Management and Budget states that although additional

steps are necessary to ensure that maximum impact is achieved through

restructurings, agencies should downsize first before crosscutting analysis

is conducted. GAO believes that, to the extent the agencies actively pursue

interagency approaches as they restructure their respective RDT&E

infrastructures, the potential for success in ongoing efforts may be

increased. As GAO has reported previously, decision-making on the size and

scope of infrastructure needed by an individual agency in the absence of

information and consideration of related missions and activities has

resulted in decisions that are not rational nor cost effective when looked

at from a broader perspective.1 GAO and the agencies agree that

maintaining more RDT&E infrastructure than warranted by requirements

does not well serve the nation’s research needs and that successful

consolidation and reduction efforts are key ingredients to assuring

adequate resourcing of future research in science and technology. GAO’s

perspective differs from the agencies’ in that we believe the best way to

achieve this end is through a governmentwide restructuring process.

The Department of Energy also questioned the basic applicability of the

best practices model, stating that the scale of the successful

consolidations cited by GAO was small in comparison to the Energy

Department’s RDT&E laboratory system. However, the Department of

Defense, which is a much larger organization, already has incorporated

many of the elements of the model in its BRAC rounds and is proposing

many of the elements for its Vision 21 process. Further, while it is

self-evident that differences in scale (and complexity) may make it more

difficult to overcome challenges and barriers, these differences do not

1

See, for example, Electronic Combat: Consolidation Master Plan Does Not Appear to Be

Cost-Effective (GAO/NSIAD-97-10, July 10, 1997).

Page 14 GAO/NSIAD/RCED-98-23 Federal Laboratory Infrastructure
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negate the validity of the process for different types of organizations nor of

the key elements employed in successful consolidations.

NASA further commented that it was concerned about GAO publishing the

report because, in NASA’s opinion, the report did not meet GAO’s normal

standards, largely because NASA believes the report overlooks its

accomplishments in reducing RDT&E infrastructure while focusing on

governmentwide issues. GAO believes its report does recognize NASA’s

accomplishments, while also pointing out that NASA’s most comprehensive

infrastructure study—its 1995 Zero-Base Review—began with the premise

that to meet its mission, NASA needed the existing infrastructure. The

model presented in this report provides a different approach by suggesting

that decisions regarding mission be made first and then infrastructure

aligned to support those missions.

Page 15 GAO/NSIAD/RCED-98-23 Federal Laboratory Infrastructure
Contents

Executive Summary 3

Chapter 1 

Introduction

20

The Federal Government’s Role in Research, Development, Test,

and Evaluation

20

Federal R&D Budgets 24

Objectives, Scope, and Methodology 28

Chapter 2 

Condition of the

Federal RDT&E

Infrastructure

32

Studies Show That a Reduction of RDT&E Infrastructure Is

Needed

32

Agencies Maintain Large RDT&E Infrastructures 33

Multiple Agencies Conduct Research in Similar Programs 38

Repairs of Aging RDT&E Infrastructure Are Backlogged 40

Chapter 3 

Approaches Other

Organizations Have

Taken to Reduce

RDT&E Infrastructure

Successfully

42

Consolidation of RDT&E Facilities at the Boeing Company

Defense & Space Group and the British Ministry of Defence’s

Defence Research Agency

42

Five Elements Critical to the Boeing Company Defense & Space

Group and British Ministry of Defence Restructuring

43

Chapter 4 

Federal Agencies’

Approaches to

Reducing RDT&E

Infrastructure Lacked

Critical Elements

48

The Department of Energy’s Restructuring Efforts 48

NASA’s Restructuring Efforts 51

The Department of Defense’s Restructuring Efforts 55

Conclusions 60

Page 16 GAO/NSIAD/RCED-98-23 Federal Laboratory Infrastructure
Contents

Chapter 5 

Observations and

Matters for

Congressional

Consideration

63

Observations 63

Matters for Congressional Consideration 65

Agency Comments and GAO’s Evaluation 65

Appendixes Appendix I: Comments From the Office of Management and

Budget

70

Appendix II: Comments From the Department of Energy 75

Appendix III: Comments From the National Aeronautics and

Space Administration

80

Appendix IV: Comments From the Department of Defense 83

Appendix V: Major Contributors to This Report 86

Glossary 87

Related GAO Products 92

Tables Table 1.1: Type of Federally Owned R&D Laboratory by Agency 21

Table 1.2: Approximate Number of Research and Support

Personnel in DOE, NASA, and DOD Laboratories and Centers

24

Table 2.1: Research Topics Involving Multiple Agencies 39

Figures Figure 1.1: Number of RDT&E Facilities in Each State 23

Figure 1.2: Agency-by-Agency Appropriation for the Conduct of

Federal Research and Development for Fiscal Year 1997

26

Figure 1.3: Projected Changes in Federal R&D Funding for Fiscal

Years 1997-2002

27

Figure 2.1: Lawrence Livermore National Laboratory, Livermore,

California

34

Figure 2.2: NASA Ames Research Center, Moffett Federal Airfield,

California

36

Figure 2.3: Wright Laboratory, Wright-Patterson Air Force Base,

Ohio

37

Page 17 GAO/NSIAD/RCED-98-23 Federal Laboratory Infrastructure
Contents

Abbreviations

AID Agency for International Development

AIDS acquired immune deficiency syndrome

BRAC base realignment and closure

DDR&E Director, Defense Research and Engineering

DED Department of Education

DERA Defence Evaluation and Research Agency

DHHS Department of Health and Human Services

DOC Department of Commerce

DOD Department of Defense

DOE Department of Energy

DOI Department of the Interior

DOJ Department of Justice

DOT Department of Transportation

DRA Defence Research Agency

DVA Department of Veterans’ Affairs

EPA Environmental Protection Agency

FDA Food and Drug Administration

FFRDC federally funded research and development center

GAO General Accounting Office

HIV human immunodeficiency virus

MOD Ministry of Defence

NASA National Aeronautics and Space Administration

NSF National Science Foundation

NSTC National Science and Technology Council

OMB Office of Management and Budget

OSTP Office of Science and Technology Policy

R&D research and development

RaDiUS Research and Development in the United States

RDT&E research, development, test, and evaluation

SSMP Stockpile Stewardship and Management Program

T&E test and evaluation

USDA U.S. Department of Agriculture

Page 18 GAO/NSIAD/RCED-98-23 Federal Laboratory Infrastructure
Page 19 GAO/NSIAD/RCED-98-23 Federal Laboratory Infrastructure
Chapter 1 

Introduction

For fiscal year 1997, the Congress appropriated $72 billion for the conduct

of federal research and development (R&D), which included Department of

Defense (DOD) test and evaluation (T&E)—only about 4 percent of the

federal budget but about 14 percent of the government’s discretionary

budget. To balance the budget, the government is cutting discretionary

spending, and R&D funding is expected to decline by about 14 percent

between fiscal years 1997 and 2002. Twenty-two federal departments and

agencies receive federal R&D funding, and 17 of the 22 own 5141 R&D

laboratories and T&E centers. Within this vast network, DOD, the

Department of Energy (DOE), and the National Aeronautics and Space

Administration (NASA) receive about three-quarters of the R&D funding and

own most of the research, development, test, and evaluation (RDT&E)

infrastructure.

The Federal

Government’s Role in

Research,

Development, Test,

and Evaluation

Investment in—and performance of—the science mission involves a

complex web of government, industrial, and academic organizations.

Funds from these three sources were estimated to total more than

$184 billion2

 in 1996.3 While industry contributes a larger share overall,

federal research is essential where the risk is too great for private

companies to make investments or where the public benefit is large

despite small private return. For example, about 60 percent of the basic

research4

 performed in the United States is funded by the federal

government. U.S. industry also depends heavily on federal research and

development for the innovations that drive productivity and new products.

Twenty-two federal departments and independent agencies receive federal

R&D funding for projects in six fundamental research areas: national

security, health and safety, energy security, environmental protection and

cleanup, industrial competitiveness, and fundamental science. As shown in

table 1.1, 175

 of the 22 organizations own 514 RDT&E facilities, 62 of which

1

See Federal R&D Laboratories (GAO/RCED/NSIAD-96-78R, Feb. 29, 1996). Although this report lists

515 federal R&D laboratories, DOD officials indicated that one DOD R&D laboratory has since closed.

2

About 62 percent of this total is funded by industry, about 34 percent is funded by the federal

government, and the remaining 4 percent is funded by universities and nonprofit organizations.

3

The National Science Foundation collects these data by different means and represents expenditures

during the calendar year; therefore, they do not correlate with the federal budget data reported

elsewhere in this report, which are shown in budget authority by fiscal year.

4

Government-funded basic research, performed mostly by university laboratories, explores the

fundamental aspects of science without specific application.

5

The Departments of Housing and Urban Development and Labor, the U.S. Agency for International

Development, the U.S. Postal Service, and the Social Security Administration receive federal funding

for research and development but do not own any RDT&E facilities.

Page 20 GAO/NSIAD/RCED-98-23 Federal Laboratory Infrastructure
Chapter 1 

Introduction

are operated by nongovernment entities—for-profit businesses,

universities, or other nonprofit organizations under contracts or

cooperative agreements with a federal agency, some of which are federally

funded research and development centers (FFRDC). Sixty-five of these

RDT&E facilities also operate a total of 221 additional satellite locations.

Much of the R&D funding the Congress provides to agencies is passed on to

laboratories and centers operated by other agencies, universities, or the

private sector. For example, DOE carries out over $1 billion in research and

development for other agencies each year. Most of the federal

government’s research and development is conducted under contract with

industry and universities—not in government-owned and -operated

laboratories.

Table 1.1: Type of Federally Owned R&D Laboratory by Agencya

Federal agency

Government-operated

laboratories

Nongovernment-operated

laboratories

Department of Agricultureb 185 0

Department of Commerce 38 0

DOD 51 16

Department of Education 0 10

DOE 7 26

Department of Health and Human Services 18 1

Department of the Interior 20 0

Department of Justice 2 0

Department of Transportation 5 1

Department of the Treasury 0 1

Department of Veterans’ Affairs 102 0

Environmental Protection Agency 11 0

NASA 9 1

National Science Foundation 0 5

Nuclear Regulatory Commission 0 1

Smithsonian Institution 2 0

Tennessee Valley Authority 2 0

Total 452 62

aIncludes T&E centers.

bAlthough the Department of Agriculture reported owning the most laboratories, its laboratories

are among the smallest in size and have relatively small operating budgets.

Page 21 GAO/NSIAD/RCED-98-23 Federal Laboratory Infrastructure
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Introduction

The federal RDT&E network is complex and definitions of what constitutes

RDT&E infrastructure can vary significantly. For example, the number of

laboratories counted depends upon the definition used for the term

“laboratory.” In fact, not all agencies use that term. A NASA “Center of

Excellence” is an overall capability that resides within a center or

laboratory.6

 Likewise, DOD differentiates strictly its R&D laboratories from

its T&E centers. The “infrastructure” associated with these facilities often

has varying definitions. (See the glossary for agency definitions of key

terms.) Figure 1.1 shows the number of RDT&E facilities located in each of

the 50 states (as of February 1996).

6

A Center of Excellence is a laboratory that specializes in an area of research and development and is

sufficiently proficient that other organizations will rely on the Center of Excellence to perform their

required work in that research and development area.

Page 22 GAO/NSIAD/RCED-98-23 Federal Laboratory Infrastructure
Chapter 1 

Introduction

Figure 1.1: Number of RDT&E Facilities in Each State

11

21

10

8 7

46

14

3

13

5

15

5

1

25

6

8

4

3

2

8

1

15 8

7

13

8

6

3 4

3

8

9

19

13

12

10

14

14 5

10

2

8

4

22

7

2

9

19 9

9

3

19

Note: Three Department of Agriculture laboratories are located in Argentina, France, and Panama

and two Navy medical research institutes are located in Indonesia and Egypt.

Page 23 GAO/NSIAD/RCED-98-23 Federal Laboratory Infrastructure
Chapter 1 

Introduction

DOD, NASA, and DOE combined own most of the federal RDT&E infrastructure.

This infrastructure consists of thousands of buildings and large acreage of

government property. More than 180,000 research and support personnel

work in these facilities (see table 1.2). Their numbers vary greatly by

agency and by facility. DOD facilities may have as few as 18 or as many as

20,000 employees. NASA facilities may have as few as 206 or as many as

6,104 employees. DOE facilities may have as few as 432 or more than 10,000

employees.

Table 1.2: Approximate Number of

Research and Support Personnel in

DOE, NASA, and DOD Laboratories

and Centers

Agencya

Research

personnel

Support

personnel

Total

personnel

DOD 39,209 61,272 100,481

NASA 11,150 8,067 19,217

DOE 38,791 22,908 61,699

aTechnical staff are included in the research category for DOE and the support category for DOD

and NASA.

Source: DOD, NASA, and DOE.

Federal R&D Budgets Funding for R&D is not identified as a single line item in the federal budget.

Instead, it is appropriated by the Congress in 13 different bills and

expenditures for programs are included in the budgets of the 22

departments and agencies involved in research, development, test, and

evaluation. These organizations report to dozens of congressional

committees and subcommittees. Further, each RDT&E facility generally

does not receive its funding in a large allocation. For example, each DOE

laboratory budget is comprised of individual funding decisions by the

Department’s senior management and program managers and by other

agencies.

The $72 billion appropriation for the conduct of federal R&D in fiscal year

1997 represented only about 4 percent of the total budget but about 14

percent of discretionary funding. About $2.2 billion also was appropriated

separately for RDT&E facilities. Of the $72 billion, about 72 percent was to

be used by DOD, NASA, and DOE, the three largest laboratory systems. As

seen in figure 1.2, DOD received about $37.3 billion, or about 52 percent of

the total. In addition to R&D funding, this amount includes funding for T&E

facilities and a significant amount of it is spent to support work in DOE’s

nuclear weapons laboratories and with NASA. In fact, DOE’s weapons

laboratories receive more than one-half of their R&D funding from DOD.

Page 24 GAO/NSIAD/RCED-98-23 Federal Laboratory Infrastructure
Chapter 1 

Introduction

While most agencies break out R&D into the three categories of basic

research, applied research, and development, DOD divides its RDT&E

account into seven categories (basic research, exploratory development,

advanced technology development, demonstration and validation,

engineering and manufacturing development, management and support,

and operational systems support). Finally, NASA received about $9 billion

and DOE received about $5.3 billion.

Page 25 GAO/NSIAD/RCED-98-23 Federal Laboratory Infrastructure
Chapter 1 

Introduction

Figure 1.2: Agency-by-Agency Appropriation for the Conduct of Federal Research and Development for Fiscal Year 1997

(constant fiscal year 1997 dollars in billions)

a

DOD

DHHS

NASA

DOE

NSF

USDA

Other

DOC

DOT

DOI

EPA

0 10 20 30 40

37.3

12.7

9

5.3

2.3

1.4

1.1

1

0.6

0.6

0.5

Agency

Budget Authority

aWhile the Department of Health and Human Services received the second largest amount of

R&D funding—about $12.7 billion—it provides primarily grants to other research organizations.

Source: Critical Technologies Institute, The RAND Corporation.

The President’s fiscal year 1998 budget projected a significant decline in

research and development (see fig. 1.3). Between fiscal years 1997 and

2002, the total R&D budget is projected to decline from about $73.7 billion

Page 26 GAO/NSIAD/RCED-98-23 Federal Laboratory Infrastructure
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Introduction

(including spending for RDT&E facilities) to about $63.4 billion, or about 14

percent. However, for fiscal year 1998, the Congress approved increases

greater than the expected 2.5-percent rate of inflation for every major R&D

funding agency except the Departments of Agriculture and Transportation.

Moreover, the Congress funded only the fiscal year 1998 installment of the

administration’s request for almost $1 billion in construction costs of

various R&D facilities. As seen in figure 1.3, defense RDT&E, which includes

funding for defense programs in DOD and DOE, is projected to decline by

about 18 percent and nondefense R&D is projected to decline by about

9 percent.

Figure 1.3: Projected Changes in

Federal R&D Funding for Fiscal Years

1997-2002 (constant fiscal year 1997

dollars in billions)

1997 1998 1999 2000 2001 2002

0

12

24

36

48

Fiscal year

Budget authority

Nondefense Defense

Source: American Association for the Advancement of Science and the Budget of the United

States Government for Fiscal Year 1998.

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Introduction

At the agency level, the President’s budget for fiscal year 1998 projected

that between fiscal years 1997 and 2002, NASA’s R&D funding will decrease

by about 12 percent and DOE’s will decrease by about 16 percent.7 DOD

plans to reduce RDT&E funding every year until fiscal year 2001 and then

projects a small increase for fiscal year 2002. In fiscal year 2002, the DOD

RDT&E budget request is estimated to be 18 percent less than in fiscal year

1997.

Objectives, Scope,

and Methodology

At the request of the former and current Chairmen of the Subcommittee on

Oversight of Government Management, Restructuring and the District of

Columbia, Senate Committee on Governmental Affairs, and the Chairman

of the House Committee on the Budget, we reviewed a number of issues

related to the federal RDT&E infrastructure. The purpose of this report is to

lay out a framework within which changes to the federal RDT&E

infrastructure can be accomplished and around which debate about the

need for those changes can occur. To do so, we have (1) examined the

condition of existing infrastructure, (2) analyzed the approaches used by

organizations outside the federal government to realign RDT&E

infrastructure, (3) and compared those approaches to federal agency

efforts.

To determine the existing condition of the federal RDT&E infrastructure, we

surveyed the 17 cabinet-level departments and independent agencies that

own such facilities. We identified and evaluated the restructuring of RDT&E

facilities undertaken by the Boeing Company Defense & Space Group (a

private company) and the British Ministry of Defence’s Defence Research

Agency. Further, we reviewed major studies conducted between fiscal

years 1987 and 1997 on federal RDT&E facilities. These studies included

those conducted by the defense base closure and realignment

commissions, the Office of Science and Technology Policy (OSTP), and the

National Science and Technology Council (NSTC); departments and

agencies; and others outside of the government.

To review the criteria and methodologies used in consolidating

successfully RDT&E infrastructure, we reviewed pertinent documents and

interviewed appropriate representatives from the Boeing Company

Defense & Space Group in Seattle, Washington; officials at the British and

Canadian Embassies in Washington, D.C.; the British Ministry of Defence

in London, England; the Defence Research Agency and Defence

7

Targeted investments in large-scale facilities and equipment, such as the $1 billion National Ignition

Facility, tend to mask greater declining R&D funding for DOE.

Page 28 GAO/NSIAD/RCED-98-23 Federal Laboratory Infrastructure
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Introduction

Evaluation and Research Agency (DERA) in Farnborough, England; and the

Defence Test and Evaluation Organisation at Boscombe Down in

Salisbury, England.

We examined infrastructure restructuring efforts throughout the federal

government and, based on our survey results, performed a detailed review

of DOE, NASA, and DOD because (1) about 72 percent of federal R&D budget

authority flows through these agencies and (2) they own most of the

federal RDT&E infrastructure. We discussed RDT&E infrastructure with

appropriate officials in the Departments of Agriculture, Commerce,

Defense, Education, Energy, Health and Human Services, Interior, Justice,

Transportation, and Veterans’ Affairs; the Centers for Disease Control and

Prevention; the Drug Enforcement Administration; the Environmental

Protection Agency; the Food and Drug Administration; NASA; the National

Institutes of Health; the National Science Foundation (NSF); the Office of

Management and Budget (OMB), and OSTP within the Executive Office of

the President.

Within DOE’s laboratory system, we visited Lawrence Livermore National

Laboratory in Livermore, California; Lawrence Berkeley National

Laboratory in Berkeley, California; Sandia National Laboratories in

Albuquerque, New Mexico; Los Alamos National Laboratory in Los

Alamos, New Mexico; Argonne National Laboratory in Argonne, Illinois;

and Brookhaven National Laboratory in Upton, New York. Also, we

interviewed officials from DOE headquarters divisions in Washington, D.C.,

and DOE representatives at the national laboratories we visited.

Within NASA’s laboratory system, we visited the Jet Propulsion Laboratory,

a FFRDC in Pasadena, California; Ames Research Center at Moffett Federal

Airfield, California; Aeroflightdynamics Directorate of the U.S. Army

Aviation and Troop Command, a tenant of Ames Research Center, Moffett

Federal Airfield, California; and George C. Marshall Space Flight Center,

Alabama. Also, we interviewed officials from NASA headquarters in

Washington, D.C.

Within DOD’s R&D laboratory and T&E center systems, we visited the U.S.

Army Research Laboratory in Adelphi, Maryland; U.S. Air Force Wright

Laboratory at Wright-Patterson Air Force Base, Ohio; Naval Air Warfare

Center, Weapons Division, China Lake, California; Naval Air Warfare

Center, Weapons Division, Point Mugu, California; Naval Command,

Control and Ocean Surveillance Center, San Diego, California; U.S. Army

Missile Command, Redstone Arsenal, Alabama; U.S. Army Missile

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Introduction

Research, Development and Engineering Center, Redstone Arsenal,

Alabama; Redstone Technical Test Center, Redstone Arsenal, Alabama;

and the U.S. Army Engineer Waterways Experiment Station in Vicksburg,

Mississippi. We also interviewed officials from the Office of the Director,

Defense Research and Engineering (DDR&E), and its Office of Laboratory

Management and Technology Transition; and the Chief Scientist and

Technical Director, Office of Naval Research, Europe, in London, England.

In addition, we interviewed officials of the Massachusetts Institute of

Technology’s Center for International Studies and Defense and Arms

Control Studies in Cambridge, Massachusetts.

All federal budget data are presented in 1997 constant dollars. We

obtained data for fiscal years 1995 to 1997 from The RAND Corporation

Critical Technologies Institute’s Research and Development in the United

States (RaDiUS) database. We also obtained data about research topics

performed by multiple agencies in fiscal year 1996, the number of

awards/tasks active in fiscal year 1996 for those topics, and their known

federal obligations for fiscal year 1996 (see table 2.1) from RaDiUS and The

RAND Corporation representatives. The Critical Technologies Institute is a

FFRDC supported by OSTP. RaDiUS is the first comprehensive, real-time

accounting of federal R&D activities and spending. It allows users to track

federal R&D activity from cabinet- and agency-level budgets down to the

program, project, and award levels, where budget categories translate into

actual R&D work performed for fiscal years 1993 to 1997. RaDiUS allows

users to see the total R&D investment by all federal agencies, compare the

level of R&D investment in specific areas of science and technology across

all federal agencies, or examine the details of research investments within

a specific agency. Researchers at the Critical Technologies Institute use

the database to analyze federal R&D expenditures and programs in support

of OSTP and NSTC. The operational version of the database recently was

made available to OSTP and other federal agencies. RaDiUS is accessible to

designated users via the Internet through the World Wide Web. The RAND

Corporation representatives said that obligational data presented in this

report are conservative because obligational data are not available for all

awards/tasks. We did not verify the accuracy of the data contained in the

RaDiUS database.

Future trend data were obtained from the Budget of the United States

Government for Fiscal Year 1998 and the American Association for the

Advancement of Science. Data on the amount of R&D investments by

industry and academia were obtained from NSF’s National Patterns of R&D

Resources: 1996. Personnel data for DOD were obtained from the

Page 30 GAO/NSIAD/RCED-98-23 Federal Laboratory Infrastructure
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Introduction

Department of Defense In-House RDT&E Activities Management Analysis

Report for Fiscal Year 1996. Personnel data for NASA were from the end of

the second quarter of fiscal year 1997 and were obtained from the NASA

Civil Service Workforce Report. Personnel data for DOE were from the end

of fiscal year 1996 and were obtained from the Secretary of Energy’s

Advisory Board. We did not attempt to verify the accuracy of these data.

We performed our review from July 1996 through June 1997 in accordance

with generally accepted government auditing standards.

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Condition of the Federal RDT&E

Infrastructure

Despite numerous studies citing the need for DOE, NASA, and DOD to reduce

significantly their RDT&E infrastructures in alignment with agency core

missions, these agencies have not responded fully to the studies’

recommendations. The energy crisis of the 1970s, the end of the Cold War

in the late 1980s, the desire for a smaller and more efficient government,

and the agreement to achieve a balanced budget by 2002 caused these

three agencies to revise their missions. In some cases, RDT&E facilities have

taken on expanded missions beyond agency core requirements in order to

employ the existing infrastructure. As a result, they perpetuate excess

capacity and retain many old, deteriorating facilities in need of repair.

Moreover, DOE, NASA, and DOD—along with many of the other 14 agencies

that own RDT&E infrastructure—have programs involving the same areas,

thus creating the potential to overlap and duplicate research.

Studies Show That a

Reduction of RDT&E

Infrastructure Is

Needed

Numerous studies, panels, commissions, and task forces, and several GAO

reports have addressed the inefficiencies in DOE, NASA, and DOD RDT&E

facilities. Many concluded that RDT&E facilities must adapt appropriately

their missions and programs to the changing world environment; tie RDT&E

closely to agency core missions; and eliminate duplication, excess

capacity, and unfunded backlogs in facility maintenance and repair. The

President’s NSTC reported that given post-Cold War conditions and new

fiscal constraints, DOE, NASA, and DOD must reduce and restructure their

RDT&E infrastructures, define laboratory missions more clearly, manage

laboratories better, and eliminate needless redundancies.1

• Since 1982, seven major panels, commissions, and task forces, and six GAO

reports have addressed how DOE could achieve operational efficiencies in

its RDT&E facilities. Recommendations included focusing unclear missions,

aligning laboratory activities with DOE goals, consolidating facilities, and

replacing its cumbersome, inefficient management structure. In particular,

the 1995 Task Force on Alternative Futures for the Department of Energy

National Laboratories (the Galvin Task Force) reported DOE’s entire

laboratory system could be reduced productively by eliminating obsolete

and redundant missions and supporting infrastructure.2

1

See Interagency Federal Laboratory Review Final Report, Executive Office of the President, Office of

Science and Technology Policy (May 15, 1995), pp. 1, 7, and 9-13.

2

See Alternative Futures for the Department of Energy National Laboratories, Secretary of Energy

Advisory Board Task Force on Alternative Futures for the Department of Energy National Laboratories

(Feb. 1995).

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• Although it did not make specific recommendations to consolidate NASA

infrastructure, the 1995 Foster Task Force3 reported that it found overlaps

in capabilities at NASA and other agencies and recommended that NASA

should reduce redundant capabilities among its centers. NASA, recognizing

its excess capacity, developed plans to close and consolidate some of its

facilities to reduce its RDT&E infrastructure, setting a “stretch” goal to

decrease the current replacement value4

 of its facilities by 25 percent by

the end of fiscal year 2000.

• Since 1987, more than 150 studies have addressed the need for DOD to

achieve operational efficiencies in its RDT&E infrastructure.

Recommendations from these studies focused most on management

efficiencies and less on infrastructure reductions. For example, the 1995

Directions for Defense: Report of the Commission on Roles and Missions

of the Armed Forces identified many opportunities for DOD to integrate

operational activities with duplicative missions in areas such as command,

control, communications, computers, and intelligence (C4

I) rather than

RDT&E infrastructure reduction.5

• The March 1997 Status of Federal Laboratory Reforms, prepared as an

update of the NSTC report, recognizes improvements but cites a continued

need for reform.

Agencies Maintain

Large RDT&E

Infrastructures

DOE, NASA, and DOD actions to address inefficiencies in their RDT&E have

focused most on management efficiencies and less on reducing

infrastructure. When attempted, strategic infrastructure reduction was

largely limited to individual facilities within agencies, but it has not been

attempted governmentwide. In part, because well-established programs

have mobilized political support to resist change, these three agencies still

maintain large, relatively unchanged RDT&E infrastructures.

Some DOE reform efforts led to management efficiencies, staff reductions,

and the closure of a few facilities directly related to the end of the Cold

War. However, DOE’s efforts failed to implement large-scale restructuring

because either the scope of these efforts was limited, subsequent

recommendations were not implemented fully, or the recommending body

3

See NASA Federal Laboratory Review, NASA Federal Laboratory Review Task Force, NASA Advisory

Council (Feb. 27, 1995).

4

The current replacement value of a facility is its acquisition cost, excluding land, and the cost of

collateral equipment and incremental book value changes escalated to the current year using a 20-city

average cost index for buildings.

5

See Directions for Defense: Report of the Commission on Roles and Missions of the Armed Forces

(May 24, 1995).

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Condition of the Federal RDT&E

Infrastructure

lacked the independent authority necessary to implement

recommendations. DOE currently maintains one of the world’s largest

collections of scientific laboratories—33 such laboratories valued at over

$100 billion. Figure 2.1 shows an aerial view of the Lawrence Livermore

National Laboratory in Livermore, California.

Figure 2.1: Lawrence Livermore National Laboratory, Livermore, California

Source: DOE.

Although budgetary constraints forced NASA to look for savings, NASA has

not consolidated or closed any of its 10 major centers. For example, the

1995 NASA Federal Laboratory Review concluded that NASA saved money by

cutting personnel but not by closing facilities. According to NASA officials,

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Condition of the Federal RDT&E

Infrastructure

additional reductions in R&D laboratories are unlikely. Although NASA

established a “stretch” goal of reducing the current replacement value of

its facilities by $2.8 billion by 2000, it may achieve only $250 million in

operations and maintenance cost reductions by then. In fact, NASA’s

infrastructure current replacement value increased by about 14 percent

between fiscal years 1990 and 1995, indicating that NASA was building new

facilities faster than it was consolidating or closing older ones. NASA’s 10

major centers currently include about 3,000 buildings on about 130,000

acres of land. Figure 2.2 shows an aerial view of NASA’s Ames Research

Center at Moffett Federal Airfield, California.

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Condition of the Federal RDT&E

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Figure 2.2: NASA Ames Research Center, Moffett Federal Airfield, California

Source: NASA Ames Research Center.

DOD will have closed 62 RDT&E sites and activities at host sites once it

implements the recommendations from the four base realignment and

closure (BRAC) rounds (1988, 1991, 1993, and 1995). While this action is

laudable, once complete, DOD still will have about 35-percent excess

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Condition of the Federal RDT&E

Infrastructure

capacity in its laboratory infrastructure and about 52-percent excess

capacity in the air vehicles, electronic combat, and armaments/weapons

arenas of its T&E infrastructure, according to DOD’s own estimates. DOD

currently owns 67 laboratories. Figure 2.3 shows an aerial view of the Air

Force’s Wright Laboratory, Wright-Patterson Air Force Base, Ohio.

Figure 2.3: Wright Laboratory, Wright-Patterson Air Force Base, Ohio

Source: U.S. Air Force.

There are cases where DOE, NASA, and DOD laboratories coordinate to help

ensure that similar research programs are complementary and not

overlapping. Although individual agencies have taken limited actions to

reduce their own RDT&E infrastructures, they have had little success in

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Condition of the Federal RDT&E

Infrastructure

consolidating infrastructure across agency boundaries. Recent attempts by

DOD to reduce RDT&E infrastructure excluded analyses of overlap with

other agencies. Previously, DOD and NASA established integrated product

teams and then alliances to improve coordination between their

laboratories. However, interagency rivalries hampered their efforts.

Further, some areas either started slowly or have not started at all. More

importantly, these teams had no explicit goal to identify ways to reduce

their infrastructures through this effort. As a result, their efforts achieved

minimal infrastructure reduction to date.

Although agencies say that they assess continuously the infrastructure

required to fulfill their mission requirements through their strategic

planning processes, in some cases, instead of restructuring their

infrastructure to support core missions, agencies have expanded missions

to preserve existing infrastructure. Rather than expanding the agency’s

mission, NASA has focused and redefined its centers’ missions. In some

cases, this has resulted in competition among agencies that may also

extend into their dealings with the private sector. For example, NASA and

Air Force test centers are competing with each other to test engines for

the Air Force’s Evolved Expendable Launch Vehicle. Also, some DOE

laboratories are competing with private industry, for example, by building

facilities to produce medical isotopes.

Multiple Agencies

Conduct Research in

Similar Programs

Many RDT&E activities of DOD, DOE, and NASA are inextricably linked. For

example, the major thrust of DOD’s RDT&E effort is national security and DOE

laboratories have been making contributions to national security since the

World War II Manhattan Project by designing, developing, and/or

maintaining nuclear weapons. NASA also contributes to national security

with its work on military aerospace and improved aircraft performance. In

addition, environmental issues are a growing part of the three agencies’

RDT&E efforts. Both DOD and DOE now have significant responsibilities for

finding ways to clean up their own pollution and advance the science and

technology of environmental remediation. NASA and DOE have undertaken

complementary or coordinated RDT&E programs related to the earth’s

environmental and climate changes.

Agency mission and RDT&E infrastructure duplication is thought by some to

be a governmentwide problem. However, the full extent is not known. DOE,

NASA, and DOD, along with many other agencies involved in research,

develpment, test, and evaluation, are awarding contracts and directing

tasks in programs that involve research on the same or similar subjects.

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This research may be different at each agency, but there is potential for

overlap or duplication. Until recently, there was no formal system to

monitor possible redundancies in research and development. The RaDiUS

database, newly created by The RAND Corporation’s Critical Technologies

Institute to support OSTP and NSTC, compiles systematically data on the

conduct of federal R&D investments by agency, bureau, program, project,

and award. This database can aggregate individual agencies’ total

investments, compare the level of investment in specific areas of science

and technology across all federal agencies, and provide the details of

research investments within a specific agency. Table 2.1 shows examples

of agencies’ fiscal year 1996 contract awards/tasks for four research topics

that we selected at random.

Table 2.1: Research Topics Involving Multiple Agencies (dollars in millions)

Research topic Agencies supporting researcha

Number of known

awards/tasks

Estimate of amounts

spent in fiscal year 1996

Fuel Cell(s) DOD, DHHS, NASA, DOE, NSF, USDA,

DOT, DVA 120+ $160-$175

HIV/AIDS DOD, DHHS, DOE, NSF, USDA, DOC,

AID, DVA, DED 2,800+ $550-$700

Human Genome DOD, DHHS, DOE, NSF, USDA, DOC,

DVA 290+ $110-$125

Aviation Safety DOD, DHHS, NASA, DOE, NSF, DOC,

DOT 160+ $800-$950

aAID (Agency for International Development); AIDS (acquired immune deficiency syndrome); DED

(Department of Education); DHHS (Department of Health and Human Services); DOC

(Department of Commerce); DOI (Department of the Interior); DOJ (Department of Justice); DOT

(Department of Transportation); DVA (Department of Veterans’ Affairs); and USDA (U.S.

Department of Agriculture).

Source: RaDiUS database, Critical Technologies Institute, The RAND Corporation.

A review of activities in the database raises concerns that duplication

within and across agencies may be prevalent and identifies opportunities

for collaborations that are being missed. The search revealed that many

agencies and awards/tasks are involved. However, what appear on the

surface to be overlapping projects or surprising locations where particular

research is taking place, in fact, may be different. For example, fuel cell

research for different vehicles (automobiles, spacecraft, and launch

vehicles) may involve distinct technologies with different objectives as

well as public and private applications. Without a comprehensive

evaluation of the actual details of the various R&D activities, it is difficult to

assess whether collaboration is sufficient or if duplication is occurring.

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Repairs of Aging

RDT&E Infrastructure

Are Backlogged

As we and others have reported, backlogs of maintenance and repairs of

deteriorating RDT&E facilities have increased significantly. Further, much of

the federal laboratory infrastructure is old, in poor operating condition, or

rapidly becoming obsolete—in part because maintenance and repairs are

underfunded.6

 Some of it is ill-equipped for today’s R&D activities. For

example, many of DOE’s older R&D laboratories were not designed to meet

today’s (1) need for precise measurements by considering factors like

temperature, humidity, and vibrations and (2) health and safety code

requirements. The lack of repair of aged facilities may reflect the realities

of recent deficit reduction efforts and associated funding priorities. In

addition, excess capacity and aged facilities in DOE, for example, may

continue to exist because facilities suffer from toxic contamination that

cannot be disposed of currently or is too costly to decontaminate and

decommission. However, since noncontaminated excess capacity exists, it

seems reasonable that restructuring could be used to reduce excess

capacity and consolidate some functions in the better maintained facilities,

and not waste available resources maintaining and repairing old and

underused facilities.

In 1993, we reported that about 54 percent of federal laboratories’ space

was over 30 years old.7 DOE’s floor space, which accounts for almost 50

percent of the total RDT&E laboratory space for all federal agencies, was

the oldest—35 percent of its space was over 40 years old, and 62 percent

was over 30 years old. In addition, 29 percent of DOD’s laboratory space

and 24 percent of NASA’s laboratory space was more than 40 years old. In

1991, DOD reported that it had a $850 million backlog in unfunded repairs

to research facilities that would take more than 12 years to eliminate.

DOE, NASA, and DOD officials confirm that the RDT&E maintenance and repair

backlogs we reported in 1993 still persist today or have been improved

only marginally. For example, in 1996, about 41 percent of DOD’s laboratory

space was over 36 years old and 62 percent was more than 26 years old.

DOE officials estimated that the agency would need $1.3 billion to maintain

and modernize R&D facilities, but funding for such projects in fiscal year

1995 was only $80 million—about 6 percent of that amount. In fiscal year

6

See DOE’s Laboratory Facilities (GAO/RCED-96-183R, June 26, 1996); Federal Research: Aging

Federal Laboratories Need Repairs and Upgrades (GAO/RCED-93-203, Sept. 20, 1993); Federal

Buildings: Actions Needed to Prevent Further Deterioration and Obsolescence (GAO/GGD-91-57, May

13, 1991); Long-Term Modernization of Research, Development, Test and Evaluation (RDT&E)

Facilities, Institute for Defense Analyses, January 1991; and NASA Maintenance: Stronger Commitment

Needed to Curb Facility Deterioration (GAO/NSIAD-91-34, Dec. 14, 1990).

7

See Federal Research: Aging Federal Laboratories Need Repairs and Upgrades (GAO/RCED-93-203,

Sept. 20, 1993).

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1997, NASA requested $238 million for routine annual maintenance and

repair of its facilities. Although this amount does not reduce its backlog of

maintenance and repairs, NASA indicated that some minor amounts of

routine maintenance funds may be expended for such projects as painting

the exteriors of mothballed buildings or replacing the roofs of facilities

considered to be excess capacity.

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Approaches Other Organizations Have

Taken to Reduce RDT&E Infrastructure

Successfully

The need to reduce RDT&E infrastructure in light of fiscal constraints and

changing requirements is not unique to the U.S. government. In recent

years, several organizations that faced declining resources and a globally

competitive business environment have restructured successfully their

RDT&E operations, reducing both the size and cost of their RDT&E

infrastructures. Our review of how two organizations’ restructured their

RDT&E facilities shows that five elements, used in concert, were critical to

their success. These two restructurings provide useful “lessons learned”

for the U.S. government.

Consolidation of

RDT&E Facilities at

the Boeing Company

Defense & Space

Group and the British

Ministry of Defence’s

Defence Research

Agency

The Boeing Company Defense & Space Group1 eliminated significant

RDT&E infrastructure through its restructuring efforts. Before restructuring,

the company had neither focused on the number or size of its facilities nor

identified how widespread duplication had hampered its facilities’

efficiency. After forecasting reductions in its workload for military

electronics and space programs in 1989, however, the Boeing Company

Defense & Space Group realigned its laboratory infrastructure to support

the company’s new strategic business plan.

In roughly 4 years, the Boeing Company Defense & Space Group reduced

its 456 laboratories to 133, cutting its square footage requirements

significantly. As a result of this consolidation, labor and other

facility-based operating costs were reduced by about $100 million. Despite

the consolidation, the company’s business base suffered no losses, and

there was little need to contract out for services. With a successful

restructuring methodology in place, the Boeing Company Defense & Space

Group began to review the possible consolidation of additional

laboratories gained through the acquisition of Rockwell International’s

space and defense units, including The Rocketdyne Corporation. An

official from the Boeing Company Defense & Space Group estimated that

this consolidation may take as few as 12 months.

Similarly, the British Ministry of Defence consolidated its four research

establishments into a single agency for laboratories, the Defence Research

Agency, which serves all three military services. The Ministry created the

agency when operating and planning problems revealed that its

laboratories and T&E sites were unresponsive to customers’ needs,

culturally antiquated, and unaffordable. The laboratories and test centers

were widely dispersed, laid out inefficiently, and in poor repair. These

1

In August 1997, the Boeing Company Defense & Space Group was renamed the Boeing Company

Information, Space, & Defense Systems Group.

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inefficiencies were compounded by a likely reduction in future defense

spending and a Ministry staff relocation that left two major sites only half

utilized and a heavy burden to operate and maintain.

To respond to these problems, from 1991 to 1995 the Defence Research

Agency reduced its 54 laboratories to 35 and combined the Ministry’s four

principal nonnuclear research establishments into one coherent and highly

efficient single organization. The agency reduced its overhead costs by

more than $100 million, yet the military-science program maintained

nearly the same level of funding. The agency later expanded to include T&E

centers and is now called DERA.

Five Elements Critical

to the Boeing

Company Defense &

Space Group and

British Ministry of

Defence Restructuring

According to the Boeing Company Defense & Space Group and British

Defence Research Agency officials, the restructuring process included five

elements that were critical to ensuring prompt and complete success.

According to officials managing these restructurings, their success

depended on using all five elements together. These elements were either

in place when the consolidation began or were added to complete the

process.

• A “crisis” that served as a catalyst to spark action.

• An independent authority to overcome parochialism and political interest.

• Core missions focused to support the organization’s goals and strategies.

• The full scope of supporting infrastructure clearly delineated.

• Accurate, reliable, and comparable data that capture total infrastructure

cost and utilization rates for each affected entity and can be collected and

evaluated systematically.

A “Crisis” as a Catalyst to

Spark Action

At both the Boeing Company Defense & Space Group and the Defence

Research Agency, the overriding catalyst that forced action to preserve the

organizations’ options and maintain the quality of their work was a shift in

national economic priorities. Organization executives at the Boeing

Company Defense & Space Group and the Ministry of Defence foresaw

imminent and severe budget cuts, which created the impetus to

restructure their RDT&E facilities.

During the U.S. defense buildup in the 1980s, the Boeing Company

Defense & Space Group operated two separate military aircraft divisions,

which competed with one another for designs. However, when the Cold

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War ended and defense budgets declined, the company realized that it

could no longer afford the luxury of internal competition.

The Defence Research Agency, on the other hand, created its own “crisis”

that served as a catalyst to effect the restructuring of its RDT&E facilities.

Originally, the Ministry of Defence was slow to respond both

organizationally and culturally to post-Cold War changes. The executive in

charge of restructuring the Defence Research Agency forced the facilities

to become financially self-sufficient by making them independent

contractors to the government, thus creating an environment of “crisis” for

both the Defence Research Agency and its new military customers.

An Independent Authority

to Direct Restructuring

According to representatives of the Boeing Company Defense & Space

Group and the Defence Research Agency, their RDT&E consolidation efforts

succeeded primarily because an independent authority provided

leadership from outside the organizations’ normal decision-making

chain-of-command. Being free from parochial or political pressures, the

authority could effect change, ensure that data collection and analysis

were efficient and objective, and implement recommendations quickly. In

the Boeing Company Defense & Space Group, the authority reported

directly to the company president, and in the Defence Research Agency,

the authority reported directly to the Secretary of State for Defence.

Facility personnel were told that the independent authority would direct

the restructuring with or without their cooperation and that it would

therefore be in their best interests to represent their facilities completely

and candidly.

Core Missions That

Support Organizational

Goals and Strategies

As part of larger organizations, the Boeing Company Defense & Space

Group and the Defence Research Agency were expected to support overall

goals and strategies as efficiently as possible. Both the Boeing Company

Defense & Space Group and the Defence Research Agency realigned their

missions to meet existing and anticipated conditions. They achieved this

by asking several basic questions:

• What are the organizations’ core missions?

• What research areas are the organizations involved in?

• Does existing research at a facility support the core missions?

• Can someone else do the research?

• What are the costs and consequences of not doing the research?

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The Boeing Company Defense & Space Group’s RDT&E facility capacity

(and any consolidation or streamlining) had to conform to the Boeing

Company’s strategic business plan. The Defence Research Agency began

operating on a “trading fund” basis and aligned its missions along

functional lines that were linked directly to the needs of its customer, the

Ministry of Defence. In both organizations, when the plans required a

particular capability, the executive responsible for the laboratories had to

choose either to maintain the applicable research and development or to

contract for it (if the capability was reasonably available by outside

contract). The Boeing Company Defense & Space Group and the Defence

Research Agency documented their decisions to ensure that laboratory

missions and functions were linked directly to the missions and functions

of the greater organization.

The Full Scope of

Supporting Infrastructure

Clearly Delineated

Before determining whether their capabilities and functions supported

their parent organizations’ missions, the Boeing Company Defense &

Space Group and the Defence Research Agency had to complete an

inventory of all their RDT&E facilities, without exception, to determine what

to cut. For example, although its High Technology Center was only 3 years

old and cost $40 million to build, it was included in the inventory and

dismantled because it failed to support the company’s strategic business

plan. According to a Boeing Company Defense & Space Group official, if

the company had exempted certain facilities from its inventory, new ones

like the Center would likely not have been cut.

Because of political sensitivities, the Defence Research Agency

restructured its RDT&E infrastructure in two phases. The R&D laboratories

were restructured first, then the T&E centers. The R&D laboratories were

easier to restructure because they were all in England, and so only one

constituent country was involved. The T&E centers, on the other hand,

were located in England, Scotland, and Wales. The agency thus had to face

three separate legislative bodies in two constituent countries (England and

Scotland) and one principality (Wales) with its politically sensitive

restructuring decisions. However, the successful restructuring of the

laboratories eased the way for the restructuring of the T&E centers.

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Accurate, Reliable, and

Comparable Data on

Infrastructure Costs and

Utilization Rates

The Boeing Company Defense & Space Group and the Defence Research

Agency discovered that their financial management systems could not

capture or evaluate either the total costs of operating their laboratories or

the facility utilization rates. Because accurate, reliable, and comparable

data were critical to success in restructuring their RDT&E facilities, both

organizations developed standardized data collection instruments to

capture necessary details about their infrastructure. These details included

each laboratory’s geographic location, original and current purpose,

present and future projects, unique capabilities, product areas, equipment

values, utilization rates, maintenance costs, personnel costs and

capabilities, anticipated capability requirements, and potential

consolidation/closing requirements.

To validate and analyze the data collected, the Boeing Company Defense &

Space Group created multidisciplinary review teams that included

scientists, strategic planners, financial experts, accountants, engineers,

and laboratory operations specialists. For each site visit, corresponding

individuals were added to the team to ensure that accurate and

comparable data were being obtained and to allow laboratory personnel to

participate in the data collection process. A neutral party unified the

overall data collection process. Once the data was collected and its

accuracy verified, the teams analyzed the data by function and, if needed,

by geographical area. Data on functional categories tied each laboratory’s

activities to its primary mission, and data on geographical area helped the

teams discern differences in facility use rates in that area. Brainstorming

sessions listed 45 to 50 functions, which were winnowed to 15 prime

functions. Team decisions were reached by consensus.

Senior scientists from the Defence Research Agency analyzed data about

each other’s facilities. The agency’s Director of Rationalisation worked

with the Director of Support Services and Director of Personnel to

restructure facilities and determine human resource needs. The final

results from these data covered over 50 individual options for sites in

detail and revealed common elements. In fact, the level of overlap was so

great that the restructuring plan could only be assembled as a complete

package after all the studies were completed.

Both organizations collected accurate, reliable, and comparable data

about their facilities across-the-board to reduce confusion, prevent facility

officials from claiming they should be exempted from restructuring, and

reduce their assertions that the facilities were “unique” or “incomparable.”

Also, both organizations’ recommendations encompassed a wide variety of

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restructuring options: closure, consolidation, relocation, downsizing,

expanding, transferring responsibility, mothballing, or no change. Once

approved, recommendations were implemented quickly.

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Elements

When the Boeing Company Defense & Space Group and the Defence

Research Agency applied elements critical to their restructuring efforts,

they achieved cost savings and operational efficiencies. However, not all

of these critical elements were present in DOE, NASA, and DOD attempts to

restructure their RDT&E facilities. Reduced agency budgets have not served

as a catalyst for major reductions or restructurings. Although individual

agencies have taken steps to realign their missions, these steps have been

taken independently and not within the context of a rational,

governmentwide approach. In fact, when agencies did refocus their

missions, the goal sometimes was to maintain existing infrastructure or to

limit infrastructure reduction. Furthermore, agencies have made decisions

using the various definitions of R&D infrastructure without considering

fully the scope of existing infrastructure and lacking information on the

cost to operate it and the way to assess its value. The five critical elements

used in concert by the Boeing Company Defense & Space Group and the

Defence Research Agency are broadly applicable to laboratory

infrastructure within and across federal agencies.

The Department of

Energy’s

Restructuring Efforts

DOE has attempted in limited and isolated ways to consolidate its RDT&E

infrastructure. For example, DOE began a restructuring of RDT&E facilities

in 1987 at the Nevada Test Site, which is used by DOE’s three defense

weapons laboratories to meet unique requirements with specific technical

and operational capabilities. At that time, DOE initiated a comprehensive

effort to reengineer its support operations and facilities at the site; created

joint experimental facilities and consolidated its construction camp,

dormitories, and other logistical services; and consolidated several

personnel support functions, such as the support contractor and drilling

crew. According to DOE officials, this effort resulted in a test site budget

about 2.5 times smaller than the 1987 budget of nearly $1 billion. Overall

however, DOE’s attempts to restructure its RDT&E facilities yielded only

modest budget savings and little or no significant restructuring. Further,

none of the five critical elements used in the successful consolidations by

the Boeing Company Defense & Space Group and the Defence Research

Agency were part of DOE’s process. Institutional barriers, along with

parochialism and other pressures, prevented DOE from reducing much of

its existing infrastructure.

During the Cold War, more than one-half of the total work of the major

DOE laboratories was directed toward defense-related research,

development, testing, and environmental management. The DOE

multiprogram laboratories and the DOE weapons laboratories have

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diversified their missions during the past decade, including, for example,

more emphasis on industrial competitiveness. Also, environmental

cleanup and restoration and nonproliferation projects that were funded

primarily by the Defense Program budget were transferred to the

Environmental Restoration and Non-Proliferation Program budgets. Thus,

the total Defense Program’s work in 1993 dipped below 50 percent of the

total laboratory complex budget.

In 1994, the Secretary of Energy announced DOE’s strategic plan, which

included a plan to reduce its budget by $14.1 billion over the next 5 years.

This goal was later revised to $10.5 billion, with savings to be achieved by

reducing management expenses in the environmental area and energy

programs and by implementing recommendations from two DOE

commissions created to improve its defense laboratories and applied

research programs.1

 In May 1995, DOE began a strategic alignment and

downsizing initiative, as part of its strategic plan, attempting to save

$1.7 billion in its laboratories over 5 fiscal years.

More recently, DOE has changed its mission focus to respond to the

changed world environment, but without a reduction in infrastructure. In

August 1995, U.S. efforts toward ratification of the Comprehensive Test

Ban Treaty required DOE to create the Stockpile Stewardship and

Management Program (SSMP) to replace research and production of new

nuclear weapons with the maintenance and testing of the existing nuclear

stockpile. The SSMP is a 10-year initiative that has cost about $4 billion per

year and is expected to cost $4.5 billion per year beginning in

1999—$400 million a year more than the Department’s annual weapons

budget during the Cold War. If funding for weapons production in Cold

War budgets is included, then the program’s budgets are substantially less

than Cold War budgets. However, current budgets do contain an increase

in annual funding for weapons research programs. Through the program,

DOE reduced some overlap and duplication at its three weapons

laboratories and made major reductions in the production complex.

Nevertheless, no major laboratory facilities will be consolidated or closed

because of the program. For fiscal year 1998, DOE laboratories are again

devoting more than one-half of their workload to defense.

Other than nuclear weapons work, DOE has expanded its RDT&E mission to

include research on, for example, the human genome, chemical/biological

warfare agents, and the expansion of fusion energy research at five

1

See Energy Downsizing: While DOE Is Achieving Budget Cuts, It Is Too Soon to Gauge Effects

(GAO/RCED-96-154, May 13, 1996).

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laboratories. Studies have been expanded at one laboratory on ways to

counter all weapons of mass destruction. Often, research on weapons of

mass destruction was mandated either within the executive branch or in

legislation.

DOE has never conducted the rigorous inventory of its RDT&E programs,

personnel, and facilities like that done by the Boeing Company Defense &

Space Group and the Defence Research Agency. As part of a recent DOE

effort to capture total research costs, all laboratories were asked to submit

personnel and cost data to enable DOE to evaluate ratios of research to

support staff, determine percent technical labor on research, and average

operating costs per research full-time employee. Laboratory directors

criticize this effort for overlooking the many unique capabilities and local

accounting methods that make DOE laboratories so diverse. They also

widely criticize DOE’s more recent requirement to collect functional cost

data, saying that it has no value. One laboratory estimated that it took

one-half of a staff year to collect the data, while at another an official said

the data cost the laboratory millions of dollars to obtain.

Except for the data now being collected, DOE has made no other effort to

validate and evaluate data about the cost or utilization of its R&D

laboratories—one of the five critical elements applied in the Boeing

Company Defense & Space Group’s and the Defence Research Agency’s

restructurings. In 1995, DOE established a Laboratory Operations Board to

guide the Department’s effort to improve the management of its

laboratories and reduce their costs, but the Board has a limited mandate

and little autonomy. In July 1996, the Board produced the Strategic

Laboratories Mission Plan, which inventoried laboratory programs and

capabilities but not their operating costs or facility utilization rates. The

latest report of the Board’s external members said that the laboratories

have made progress and have cut costs, but they note that inefficiencies in

each mission continue because of DOE’s complicated management

structure and that progress over the last year has been much slower than

is desirable.

Their main findings state that DOE program plans need improvement. The

Board reports that each program needs a plan that articulates a compelling

mission, identifies the technical paths to accomplish the mission, and

defines the roles of different R&D performers to accomplish the missions.

The Board notes that this has been accomplished in DOE’s Defense

Program, but to a much lesser extent in the other parts of the Department.

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In many programs, the Board finds that plans are not worked out in

sufficient detail to allow the laboratories to plan their roles.

The report also states that some programs are using a larger number of

performers than appears optimum; there are opportunities to improve

performance and reduce costs through better focusing; and better

planning is needed, for example, to set priorities for the energy mission, to

develop a road map for future major scientific facilities, and to develop

greater integration across R&D programs. The Board is surveying currently

some of DOE’s small, single-purpose laboratories to validate roles or

determine if they are candidates for privatization, alternative contracting

mechanisms, consolidation, or closure, but it is not performing the same

review of the large, multiprogram laboratories where opportunities for

overlap and duplication are most prevalent.

Directors at three of the multiprogram laboratories told us that an

independent authority was needed to reduce RDT&E infrastructure.

However, the directors at DOE’s three weapons laboratories or their

representatives disagreed; they contended that the SSMP already had

focused their missions and consolidated their funding for the next decade.

NASA’s Restructuring

Efforts

Several elements we identified in the Boeing Company Defense & Space

Group and the Defence Research Agency models were evident in NASA’s

response to what it perceived as a serious budgetary crisis. In response to

successive budgetary reductions, NASA readjusted missions at individual

locations and closed some facilities that were no longer needed. Most

recently, the Administrator introduced an initiative, which is scheduled to

be implemented fully in fiscal year 1999, to capture more fully the cost of

supporting NASA’s missions.

NASA officials note that the elimination of unnecessary infrastructure is a

continuous, ongoing objective of the agency’s strategic planning. Despite

this plan, it remains to be seen whether NASA can meet its internal

infrastructure reduction goals and, through its cooperative efforts with

DOD, reduce unnecessary duplication in aerospace RDT&E facilities.

NASA Has Applied Several

of the Critical Elements in

Its Restructuring and

Achieved Some Reductions

NASA’s future years’ budget requests for fiscal years 1995 to 2000 were

reduced from $122 billion in fiscal year 1993 to $82 billion in fiscal year

1996. To manage this major reduction, beginning in fiscal year 1994, NASA

adjusted or terminated several major programs. The agency also began to

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reduce the number of support contractors and decrease its workforce

from about 25,000 in fiscal year 1993 to a projected 17,500 in fiscal year

2000—a 30-percent reduction. In fiscal year 1996, NASA decided to absorb

funding decreases by consolidation and closure of smaller facilities in

conjunction with personnel reductions. NASA officials said they made a

conscious decision not to close any of NASA’s 10 major centers based on

the agency’s workload, customer requirements, and statutory

responsibilities.

NASA officials believe NASA still is in a budgetary crisis. However, parochial

and cultural barriers have prevented a more substantial reduction in its

facilities infrastructure to help deal with the crisis. These barriers include

concerns about the effect that closing facilities, relocating activities, and

consolidating operations will have on missions, personnel, and local

communities. As we reported in 1996, NASA will not meet its initial goal of

decreasing the current replacement value of its facilities by $4 billion.2

Instead, NASA now plans a $2.8 billion reduction in the current replacement

value of its facilities, or approximately 16 percent of the facilities

identified in the 1994 baseline. This reduction is estimated to yield only

about $250 million in operations and maintenance cost reductions through

fiscal year 2000. The agency will not meet its goal partially because it has

had problems evaluating some cost-reduction opportunities and its efforts

with DOD to coordinate the joint use of facilities are progressing slowly.

Like the Boeing Company Defense & Space Group and the Defence

Research Agency, NASA’s Zero-Base Review3

 redefined roles and program

management structures and better focused its centers’ missions. However,

the review began with the premise that to meet its mission, NASA needed

the existing infrastructure. Therefore, NASA purposefully did not

consolidate or close any of its 10 major R&D centers. Rather, NASA made

laboratory infrastructure reductions within each center by deactivating 25

wind tunnels and aeropropulsion facilities and closing some of its smaller

sites. For example, in 1995, (1) the Jet Propulsion Laboratory closed its

Edwards Test Station at Edwards Air Force Base, California; (2) Ames

Research Center closed Crows Landing in Stanislaus County, California4

;

2

See NASA Infrastructure: Challenges to Achieving Reductions and Efficiencies (GAO/NSIAD-96-187,

Sept. 9, 1996).

3

The Zero-Base Review was a NASA-wide effort completed in June 1995 to allocate reductions in the

fiscal year 1996 budget, establish center role assignments, provide suitable guidance for the fiscal year

1997 budget, and change the way NASA conducts business. However, of the review’s 50

recommendations, only two applied to specific facilities.

4

Crows Landing was a former Navy airfield that Ames Research Center acquired as a result of

becoming landlord of Moffett Federal Airfield following the 1991 BRAC round.

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and (3) Marshall Space Flight Center, Alabama, closed the Slidell

Computer Facility in Slidell, Louisiana, and the Yellow Creek Facility in

Iuka, Mississippi, which was to have built the Advanced Solid Rocket

Motor for the Space Shuttle. According to NASA officials, additional

reductions are unlikely in NASA’s centers.

NASA attempted to define clearly its supporting infrastructure in

considerable detail. Using the National Facility Study that was performed

in 1993 to 1994 as a starting point, and, in cooperation with DOD, NASA

created the Major Facilities Inventory, which provided a database of 1,494

NASA and DOD facilities. However, this database is not being used to make

decisions regarding reductions in infrastructure because it contains errors

and does not use consistent metrics and credible variables that could be

applied across NASA or DOD.

While the two agencies have not found opportunities to eliminate physical

infrastructure from their inventories, they have found modest ways to

avoid costs. For example, the two agencies can avoid spending

(1) $60 million by combining spacecraft technology demonstrations and

sharing the results of their experiments; (2) $14 million by sharing a C-17

aircraft hangar at Edwards Air Force Base/Dryden Flight Research Center,

California; (3) $445,000 through joint use of an alternative fueling facility

at Langley Air Force Base/Langley Research Center, Virginia; and

(4) $200,000 annually through the Army’s use of the Marshall Space Flight

Center’s photography laboratory at Redstone Arsenal, Alabama.

NASA does not have an integrated financial system. Also, NASA officials do

not know the true costs of operating and maintaining the agency’s

laboratory infrastructure. Each of the 10 major centers maintains its own

accounting system. NASA’s nonstandard, decentralized accounting systems

do not capture information on overhead rates in a consistent, rigorous,

reliable, or useable manner. According to a NASA official, the agency has a

poor cost-accounting analysis capacity, poor cost-accounting systems, and

cannot determine the laboratories’ actual costs. In 1995, NASA introduced

an initiative, which it is implementing incrementally, to integrate full-cost

accounting, budgeting, and management practices. The initiative was

begun to provide complete cost information with which to make more

fully informed decisions and improve mission performance. Full

implementation of the initiative requires that NASA’s financial systems be

improved significantly to accommodate detailed cost data, practices, and

processes. NASA has indicated that it plans to integrate the full-cost

accounting system in its fiscal year 1999 budget. However, according to a

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NASA official, the resulting cost data still will not provide the level of detail

needed for infrastructure reduction processes like those used by the

Boeing Defense & Space Group and the Defence Research Agency.

NASA and DOD Efforts to

Work Together

In April 1996, NASA and DOD agreed to form alliances to work together more

efficiently and effectively in six categories of major test facilities,

including wind tunnels, air-breathing propulsion, rocket propulsion, space

environmental, hypervelocity ballistic range/impact, and arc-heated

facilities. The agreement was the result of a joint study, Final Report on

the 1995-1996 DOD/NASA Cooperation Initiative, which concluded that,

because a number of major test facilities were deactivated since 1993, the

existing major facilities “very nearly represent the minimum necessary” to

conduct current and planned civil and defense-related aerospace research,

development, test, and evaluation. However, the study also concluded that

NASA and DOD do not coordinate adequately major test facilities’

investments, upgrades, and operations, and there was excess capacity in

rocket engine test facilities.

NASA officials note that the starting point for determining infrastructure

needs are NASA and DOD’s missions and programs. Nonetheless, the

agencies have not directly sought infrastructure reduction as part of the

alliances’ goals. Also, NASA and DOD cooperative activities under the

alliances have been limited since their agreement in April 1996. Beyond

the Rocket Propulsion Alliance, only two of the five new alliances actually

convened.5

In part because NASA and DOD have not been directed specifically to

consider jointly RDT&E infrastructure reductions during such

restructurings, these agencies are not adequately coordinating with one

another about infrastructure investment decisions and infrastructure

consolidations. For example, according to DOD officials, DOD’s 1996 Vision

21, a 5-year plan directed by the Congress to consolidate and restructure

DOD’s R&D laboratories and T&E centers for the 21st century, does not

provide for coordination with or participation by NASA. Moreover, the plan

does not call for involvement by DOE.

The National Defense Authorization Act for Fiscal Year 1997 (sec.

211) directed NASA and DOD to prepare a joint plan, by the end of 1996, for

coordinating and eliminating unnecessary duplication in the operation and

5

For a further discussion of the alliances, see our forthcoming report on Aerospace Testing: Promise of

Closer NASA/DOD Cooperation Remains Largely Unfulfilled (GAO/NSIAD-98-52).

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planned improvements of the rocket engine and rocket engine component

test facilities managed by the Air Force and NASA and for developing

commonly funded and operated facilities. The agencies did not meet the

deadline but indicated that they had efforts underway to form the basis for

such a plan.6

 However, the outcome of these efforts is uncertain or

excludes NASA.

It remains to be seen whether the two agencies’ cooperative efforts will

reduce their investments, excess capacity, and unnecessary duplication in

aerospace RDT&E facilities. NASA center officials generally agreed that an

independent, external authority may be necessary to optimize

restructuring activities, but they believe that NASA already has focused

successfully its centers’ roles and missions.

The Department of

Defense’s

Restructuring Efforts

Although DOD has been through four BRAC rounds, it has not made the

reductions and realignments of RDT&E infrastructure it deems necessary.

Its Vision 21 initiative incorporates several of the elements critical to

success, but it is on hold pending resolution of related BRAC issues.

The end of the Cold War, combined with the increasing need to reduce and

eventually eliminate the federal budget deficit, altered fundamentally DOD’s

requirements for RDT&E infrastructure. DOD officials recognized the need to

(1) reduce excess capacity, (2) avoid unnecessary overlap and duplication

in missions and capabilities, (3) reduce costs, and (4) maximize

operational efficiency and effectiveness. According to the former

Secretary of Defense, future increases in spending for readiness and

weapons modernization will have to come, in part, from infrastructure

reduction savings. Further, DOD officials recognized that to fund weapons

modernization and modernization of required RDT&E infrastructure, DOD

must reduce current infrastructure costs by eliminating old,

high-maintenance, and inefficient RDT&E facilities while retaining critical

capabilities to meet future requirements.

Since 1989, DOD has missed three opportunities for interservice

consolidations to reduce RDT&E infrastructure and maintained the status

quo of separate RDT&E facilities for each military service instead. These

opportunities were (1) the RDT&E restructuring that occurred at the end of

Cold War, (2) the 1995 BRAC round, and (3) Vision 21.

6

These efforts include DOD’s Vision 21 and Quadrennial Defense Review and a joint draft rocket

propulsion test alliance.

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The end of the Cold War afforded DOD its first opportunity. In 1989, the

President directed the Secretary of Defense to develop a plan to

implement fully the Packard Commission recommendations7

 and to review

DOD’s management. The Secretary of Defense formed a task force to

provide specific plans on how suggested guidance on cutbacks would be

implemented. One of the task force’s recommendations was to consolidate

RDT&E activities into a single agency.

In response to the recommended consolidation, the services offered a

counter-proposal that ultimately established Project Reliance, which was

intended to improve coordination and reduce overlap and duplication in

the services’ RDT&E programs and facilities. While Project Reliance has

improved communications and increased cooperation between the

military services’ RDT&E activities, it was not conceived as a mechanism for

infrastructure reductions and thus maintains the status quo. DOD also did

studies that focused on interservice rather than intraservice

consolidations, in which the three services were already engaged. DOD’s

first opportunity was lost because the services implemented RDT&E

restructuring with little interservice consolidation.

DOD officials did not—and still do not—have a sense of “crisis” because

RDT&E funding long has been a national security priority and has been

relatively flat or decreasing only slightly. The closest DOD came to facing a

“crisis” similar to that of the British Ministry of Defence was a 1990 task

force recommendation to consolidate all RDT&E organizations into a single

agency.8

 In referring to this recommendation, an official in the Office of

the Secretary of Defense stated that “nothing could bring the services

together in agreement like a threat.”

Overall, the roles and missions of DOD’s RDT&E facilities are aligned closely

with the services and responsive to their requirements. They are integral

components of the military departments’ acquisition and combat support

infrastructure. The basic mission of DOD’s laboratories is “to provide the

technical expertise to enable the Services to be smart buyers and users of

7

The recommendations addressed defense management structural problems in the areas of national

security planning and budgeting, military organization and command, acquisition organization and

procedures, and government-industry accountability. The recommendations included (1) presenting

the defense budget to the Congress based on national priorities and operational concepts rather than

line items; (2) changing current law to designate the Chairman of the Joint Chiefs of Staff as the

principal uniformed military advisor to the President, the National Security Council, and the Secretary

of Defense; (3) creating the new position of Under Secretary of Defense (Acquisition); and

(4) providing precise criteria for applying contractor sanctions.

8

See Defense Management Report: RDT&E Consolidation, Office of the Under Secretary of Defense for

Acquisition Defense Management Report Task Force (Oct. 9, 1990).

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new and improved weapons systems and support capabilities.”9 While

DOD’s laboratories act as interpreters and integrators of technology,

industry produces the products—weapons systems—that the laboratories’

customers, the warfighters, ultimately use. Although each service aligns its

laboratories along core product lines (such as ships, aircraft, tanks,

weapons, and communications) and assigns its laboratories full life-cycle

R&D responsibility, DOD laboratories help support each of the six areas of

national need outlined in chapter 1.

It has been long recognized that the services have had many crosscutting

opportunities for more direct use of resources so that duplicative and

overlapping capacity and capabilities could be reduced or eliminated.

However, service parochialism and controversies successfully thwarted

any such restructuring. Although DOD officials recognize that any lasting

solution to reducing RDT&E infrastructure requires breaking down

long-standing cultural barriers involving service parochialism, DOD to date

has been unable to achieve that goal even with an independent, external

authority (the BRAC process), which focused primarily on the closure of

military bases.

Since 1988, the BRAC process also has been the primary vehicle within DOD

for RDT&E infrastructure reductions. In 1996, we reported that despite four

BRAC rounds in 1988, 1991, 1993, and 1995, DOD’s infrastructure reductions

had not kept pace with reductions in funding, personnel, and force

structure.10 When the last round has been implemented fully by 2001, DOD

will have closed 62 RDT&E sites and activities at host sites,11 but significant

excess capacity will remain in DOD’s RDT&E infrastructure. According to

officials from the BRAC 1995 Laboratory Joint Cross-Service Group, after all

current BRAC actions have been completed, DOD’s laboratory infrastructure

still will have an excess capacity of about 35 percent. Similarly, according

to officials from the BRAC 1995 Test and Evaluation Joint Cross-Service

Group, DOD’s T&E infrastructure will have an excess capacity of about

52 percent in the areas of air vehicles, electronic combat, and

armaments/weapons.

9

See Federal Advisory Commission on Consolidation and Conversion of Defense Research

Laboratories, 1992.

10See Defense Acquisition Infrastructure: Changes in RDT&E Laboratories and Centers

(GAO/NSIAD-96-221BR, Sept. 13, 1996).

11During the four BRAC rounds, the Army closed only three sites and 11 activities at sites located on

other installations. The Navy closed 13 sites and 27 activities at host sites. The Air Force closed only

three sites and five activities at host sites.

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DOD has been forced through four BRAC rounds12 to clearly define and

delineate in detail the full scope of its supporting RDT&E infrastructure.

Also, during the BRAC process, DOD attempted to develop and use accurate,

comparable cost data to overcome concerns regarding the lack of

consistency and reliability of data used in the process, but was

unsuccessful. DOD did not capture the total costs associated with operating

and maintaining its RDT&E infrastructure in previous BRAC rounds

either—and still does not know the true costs of operating its RDT&E

facilities. DOD officials found it particularly difficult to compare

laboratories across the services due to insufficient cost and equipment use

data. In some cases, according to BRAC 1995 participants, data were

collected and compiled by those most affected by the outcome of the

analysis, and prior knowledge about how the data was to be evaluated led

to modifications of the data in a way that made an accurate analysis

impossible.

During the first three BRAC rounds, each of the service’s processes and

recommendations focused almost exclusively on its own activities without

considering the potential for consolidating work across service lines.

Therefore, joint cross-service groups for RDT&E facilities, among others,

were established for BRAC 1995. The Vice Chairman of the Joint Chiefs of

Staff advocated a strong role for the joint cross-service groups and

recommended that the services be required to incorporate their

alternatives in the final recommendations,13 thus affording DOD the second

opportunity for interservice consolidations. However, the services

asserted that they had to retain the final decision on realignments and

closures to meet their individual responsibilities to ensure, for example, a

ready and controlled source of technical competence and the resources

necessary to ensure timely responses.

DOD also lost opportunities in the BRAC 1995 process to reduce its RDT&E

infrastructure.14 For example, DOD’s decision to split its analysis of R&D

laboratories and T&E centers into two groups created artificial barriers

around the functions and facilities that each could consider. R&D

laboratories and T&E centers later were reviewed independently using

12See Base Realignment and Closures: Report of the Defense Secretary’s Commission (Dec. 29, 1988);

1991 Report to the President, Defense Base Closure and Realignment Commission (July 1, 1991); 1993

Report to the President, Defense Base Closure and Realignment Commission (July 1, 1993); and 1995

Report to the President, Defense Base Closure and Realignment Commission (July 1, 1995).

13See Military Bases: Analysis of DOD’s 1995 Process and Recommendations for Closure and

Realignment (GAO/NSIAD-95-133, Apr. 14, 1995).

14See Defense Acquisition Infrastructure: Changes in RDT&E Laboratories and Centers

(GAO/NSIAD-96-221BR, Sept. 13, 1996).

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different methodologies. Also, the services protected their own facilities,

which undermined the BRAC process. The services did not adopt scenarios

that could have eliminated excess T&E infrastructure and could not agree

on comparable definitions of laboratories and centers or potential

realignments or closures, since they were unwilling to collocate or rely on

each other. Thus, BRAC 1995 resulted in little joint cross-servicing.

Upon expiration of BRAC legislation and full implementation of previous

BRAC recommendations, DOD and the Congress realized that RDT&E

infrastructure needed to be reduced further. Because DOD was unable to

do it on its own, the Congress directed the Secretary of Defense, in the

National Defense Authorization Act for Fiscal Year 1996 (sec. 277), to

develop a 5-year plan to consolidate and restructure DOD’s RDT&E facilities

for the 21st century. The Secretary of Defense was to specify the

administrative and legislative actions needed to consolidate RDT&E

facilities into as few as practical and possible by October 1, 2005.15 The

Secretary of Defense responded with a plan and developed a legislative

package entitled Defense Research, Development, Test and Evaluation,

Vision 21, Reduction, Restructuring and Revitalization Act of 1997

(commonly referred to as Vision 21). DOD initially sought unilateral

authority to reduce its RDT&E infrastructure. However, while the legislative

package was being reviewed for interagency coordination, officials from

OMB told DOD that it must include an independent commission in the Vision

21 process, since DOD has historically been unable to reduce significantly

its RDT&E infrastructure.

DOD officials consider Vision 21 the equivalent of a BRAC round for RDT&E

facilities. DOD officials structured Vision 21 to incorporate the lessons

learned from BRAC 1995 concerning the decision-making process, which

had resided solely with the services. Thus, Vision 21 became another DOD

opportunity for interservice consolidations. Moreover, DOD’s plan

incorporated most of the critical elements used by the Boeing Company

Defense & Space Group and the Defence Research Agency, such as the

collection of accurate, reliable, and comparable data that captured the

total cost associated with RDT&E operations and an analysis of the data

along functional lines and related directly to the agency’s overall mission.

The legislative package was modified to include a provision for an

independent commission outside of DOD to make the final realignment and

closure recommendations to the Congress.

15Section 265 of the act requires the Secretary to conduct a related comprehensive review of the

aeronautical research and test facilities and capabilities to assess their current condition.

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Vision 21 did not contain any provision to review related or duplicative

facilities in other agencies, however, because the Congress, in section 277,

did not direct DOD to seek interagency cooperation. Moreover, DDR&E

officials want to rationalize DOD’s RDT&E facilities before addressing issues

inherent in analyzing NASA and DOE facilities as well.

More recently, the Quadrennial Defense Review called for two additional

BRAC rounds for fiscal years 1999 and 2001. DOD decided not to submit its

legislative package for Vision 21 and instead opted to include RDT&E

infrastructure in any future BRAC round, again rejecting efforts that would

result in interservice consolidation and delaying this opportunity to

implement the critical elements used in the Boeing Company Defense &

Space Group’s and the Defence Research Agency’s restructuring. Since the

Congress has not accepted DOD’s BRAC legislative package and DOD’s

recommendation for two new BRAC rounds in 1999 and 2001, it remains

unclear whether DOD will attempt to consolidate and restructure its RDT&E

infrastructure and how it might proceed.

Conclusions Although there are no easy solutions for how a successful consolidation

process can be used to restructure and reduce RDT&E infrastructure

throughout the federal system, our review indicates that lessons from the

Boeing Company Defense & Space Group and British Ministry of Defence

models could be applied successfully to federal agencies.

• A Catalyst to Spark Action. Catalysts that precipitated successful

laboratory consolidations by the Boeing Company Defense & Space Group

and the British Ministry of Defence (i.e., severe fiscal constraints,

structural changes that shift significantly control of budgets, mission

failures, etc.) are not affecting federal agencies in ways that effect bold

actions. In an enterprise as broad and diverse as the federal laboratory

system, the potential effects of catalysts such as “budget crises” may be

averted for years because the impacts of funding reductions and mission

shifts can often be delayed indefinitely. It is well understood by many

laboratory managers and budgeteers, however, that a federal budget

“crunch” precipitated, in part by continued decreases in federal

discretionary spending, is “right around the corner.” Considering

conditions that exist in the federal laboratory systems, now is the time to

act.

• An Independent Authority to Direct Restructuring. Many government

officials responsible for directing federal RDT&E activities, as well as

academic and industry representatives, have said that significant barriers

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impede successful infrastructure reduction efforts. Further, many of them

agree that, while a more rational R&D infrastructure is needed, agencies

have been unable to achieve significant infrastructure reductions alone

because they face intractable barriers. They further conclude that an

independent, external panel or commission would be crucial to making

significant reductions. At various times, some members of Congress, the

GAO, and others, having reached similar conclusions, have called for

consideration of this option for DOE, NASA, and DOD laboratories or T&E

centers.

However, there is little agreement on how to structure an independent

authority to focus on governmentwide reductions of RDT&E infrastructure,

and no agreement exists on the scope of the restructuring to be attempted.

Such an approach could only succeed if both the Congress and the

administration agree that change is necessary and openly demonstrate the

willingness to scale the federal RDT&E infrastructure to better meet

national needs.

• Core Missions That Support Organizational Goals and Strategies. Although

federal laboratories acknowledge the need to focus their core missions

better, they have been incapable of doing so on their own. However, it is

taken for granted that missions must be refocused around agency core

functions if they are to meet impending fiscal constraints. Existing

legislative frameworks, such as the Government Performance and Results

Act of 1993 (the Results Act), could be used to determine and establish

appropriate core missions for each laboratory in the federal RDT&E system.

The Results Act already engages agencies and the Congress in a dialogue

about missions and performance. In addition, alternative approaches to

reducing infrastructure, but also requiring legislative action, include the

following:

• Establish an independent commission with the authority to (1) review

and evaluate the agencies’ R&D laboratory and T&E center missions,

(2) conduct comparative analyses of the RDT&E capabilities and

capacities, and (3) make recommendations regarding mission focus and

infrastructure reductions to the Congress and the administration.

• Prepare for a comprehensive RDT&E infrastructure reduction effort by

having an independent authority begin a “pilot program” to focus on one

or two lines of research or documented areas of duplication,

redundancy, or excess capacity. Potential areas or commodities include

chemical and biological warfare agents, solar power, nuclear

nonproliferation, or energetics.

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• Amend current mandates, such as section 277 of the National Defense

Authorization Act for Fiscal Year 1996, to require interagency analyses

in decision-making regarding reductions of RDT&E infrastructure.

• The Full Scope of Infrastructure Clearly Delineated. Agency efforts to

identify and disclose the scope and capabilities of their RDT&E

infrastructure, which have only recently emerged, have not yet been used

for infrastructure reductions. The computerized Major Facilities Inventory,

which includes more than 1,494 RDT&E facilities operated by DOE, NASA, and

DOD, as well as R&D facilities owned by the National Ocean and

Atmospheric Administration, is a first step and could provide data to set

the stage for reductions. Interagency agreement not to take anything “off

the table” before discussion begin also is necessary.

• Accurate, Reliable, and Comparable Data on Infrastructure Cost and

Utilization Rates. Accurate and reliable data about the true cost of

operating federal RDT&E facilities are not available, thus making meaningful

comparisons of relative efficiency difficult.

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Observations The RDT&E establishment is in transition. The missions of R&D laboratories

and T&E centers are being redefined within a changed global environment

as agencies compete for scarce federal resources. Future pressures to

reduce discretionary spending governmentwide suggest that, without

changes now, a greater share of science funding will be devoted to

operating and maintaining an aged, inefficient, and costly infrastructure at

the expense of research and development. The current condition, although

unsettled, provides an opportunity to shape the future in a way that

ensures an efficient and rational RDT&E infrastructure is in place to support

current and future science priorities.

Adjusting the federal infrastructure to meet the most important current

and future RDT&E requirements is an enormous task that has, to date,

proven to be intractable. Cultural and parochial barriers have, in large

part, been responsible for federal agencies’ inability to achieve a major

restructuring of RDT&E facilities within and across the agencies. As is

apparent in reviewing the restructuring process of the Boeing Company’s

Defense & Space Group and the British Defence Research Agency, the use

of an independent authority to direct the process was key to achieving

streamlined RDT&E operations and infrastructure. The approaches taken by

individual agencies have not been sufficient to balance the federal RDT&E

infrastructure with focused core missions and has resulted in concerns

about mission overlap and duplication and the retention of excess

capacity. For example, the September 1997 plans submitted by these

agencies as mandated by the Results Act did not use cross-agency criteria

for assessing missions as required by the Results Act.

The critical elements of the best practices model we analyzed, when

compared to ongoing efforts in the federal government, suggest

approaches that could prove successful. However, consensus must be

reached that significant changes in the RDT&E infrastructure would better

position federal agencies to support current and future science priorities

through a more efficient and rational RDT&E infrastructure possible.

First, we encourage the federal departments and independent agencies to

continue their individual efforts to achieve management efficiencies in

their respective RDT&E infrastructure restructuring efforts, but with an

increased focus on interagency approaches. Cross-agency efforts to

support an RDT&E infrastructure restructuring process could begin in the

executive branch with two agencies: (1) OSTP, which has technical

cognizance across the federal RDT&E arena, but no direct means to effect

change and (2) OMB, which is responsible for helping to maintain effective

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government by reviewing the organizational structure and management

procedures of executive branch agencies and developing efficient

coordinating mechanisms to implement government activities and expand

interagency cooperation.

Although these agencies have engaged DOE, NASA, and DOD in internal

reviews, such as OSTP’s recently established NSTC Interagency Working

Group, no independent mechanism exists to undertake a structured

approach for streamlining the overall federal RDT&E infrastructure, that is,

looking at the infrastructure of individual agencies in support of the

government’s broader strategies and missions. OMB, in responding to a

draft of this report, said that it prefers to see federal RDT&E infrastructure

examined as a whole only after reductions using the current

agency-by-agency approaches are completed.

Ultimately, however, many of the structural and other barriers that exist

between agencies go beyond those found at the agency level. Initiating a

governmentwide process that includes all five elements discussed in this

report could mitigate virtually all of the parochial concerns that stymied

past efforts to restructure.

Establishing an independent decision-making authority could ensure that

all elements of the process are administered fairly. In implementing the

process described in this report, such an authority could benefit from

information developed through ongoing initiatives, such as proper

implementation of the Results Act, to help coordinate missions and goals

of individual agencies that are involved in crosscutting program areas and

balancing individual agencies’ multiple strategic goals. It also could benefit

from lessons learned from the government’s past uses of independent

authorities, such as the defense base closure and realignment

commissions, and from activity and budget details about research and

development accumulated in the RaDiUS database that is used to compile

systematically data on federal R&D investments.

The need to reduce RDT&E infrastructure in balance with mission

requirements is a long-standing and complex issue. Agency efforts to date,

while encouraging in some cases, are too narrowly focused and likely will

promote or sustain duplication and excess capacity. Further, many of the

elements employed as best practices by other organizations are neither

integral to nor readily available to federal agencies. Thus, a

governmentwide approach, which could focus both within and across

agencies may offer a viable alternative and increase the likelihood of

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successfully reshaping the nation’s RDT&E infrastructure to meet current

and future needs. While agencies should be encouraged to continue

ongoing efforts to improve efficiencies in the management of RDT&E

infrastructure, emphasizing interagency approaches could be a significant

improvement in this arena.

Matters for

Congressional

Consideration

To help craft a more efficient structure to support future federal RDT&E

efforts, the Congress may wish to begin a process to reduce the federal

RDT&E infrastructure that applies collectively the critical elements

identified in this report. This process could be designed to look both

within and across agencies to eliminate unnecessary mission overlap and

duplication and the resulting excess infrastructure capacity. Lessons

learned from the federal government’s past uses of independent, external

authorities could be used to provide structure to this process. Ongoing

restructuring efforts of the agencies could be assessed for their potential

to contribute to overall RDT&E infrastructure streamlining. The RaDiUS

database could provide preliminary inputs indicating possible duplication

of effort. The Government Performance and Results Act of 1993 provides

an established legislative framework, which addresses agencies’ missions

and performance, and may be useful in focusing specifically on

crosscutting agency missions that determine the requirements for RDT&E

infrastructure.

Agency Comments

and GAO’s Evaluation

In commenting on a draft of our report, the Departments of Energy and

Defense, NASA, and OMB generally indicated that the report did not give

sufficient credit for actual, ongoing, and planned infrastructure reductions

they have undertaken. To illustrate further the infrastructure reduction

steps the agencies have initiated, we have added information that

recognizes other agency plans and activities.

Although the agencies acknowledge that they need to reduce further their

infrastructure, there was no universal view expressed as to how to effect

significant change in the federal RDT&E infrastructure. For example, while

each of the four agencies recognized the importance of mission focus in

their comments, they had varying perspectives regarding the efficacy of

the model’s other critical elements. DOE, for example, does not believe a

“crisis” is needed to spur action, stating that changing missions and budget

reductions provide the external pressure needed to get change. However,

as the report points out, DOE’s new missions are being developed from the

inside and decreases in budgets have been addressed largely through plans

Page 65 GAO/NSIAD/RCED-98-23 Federal Laboratory Infrastructure
Chapter 5 

Observations and Matters for Congressional

Consideration

to improve management efficiencies. Conversely, NASA agreed with the

need for accurate and reliable data about the true cost of operating RDT&E

facilities and pointed out that it is developing an integrated financial

management system to gather such data. DOD agreed with our conclusion

regarding the need for an independent, BRAC-like authority to effect

significant change. DOE and NASA, on the other hand, believe they can

make, or have already made, appropriate changes regarding the future

strategies for their RDT&E infrastructure. OMB’s strategy blends the two. OMB

believes each agency should rationalize individually its infrastructure

before a more complex interagency approach is attempted. OMB agrees

with GAO, however, that an interagency approach is needed. With respect

to defining fully the scope RDT&E infrastructure, the agencies comments

largely were silent.

After reviewing carefully the agencies’ comments, we believe that the

comments generally reflect the parochialism and structural and

organizational barriers discussed in the report. For example, when the

agencies’ comments discussed planned RDT&E infrastructure reductions,

those plans were limited in scope and focused exclusively on internal

reductions. While acknowledging, in some cases, overlapping capability

and excess capacity in RDT&E infrastructure, Departments of Energy and

Defense and NASA comments generally reflect their belief that (1) their

missions and associated infrastructure are unique, (2) they have planned

to do enough restructuring and consolidation on their own, and (3) they

already coordinate among agencies to the maximum extent practicable.

OMB states that although additional steps are necessary to ensure success,

agencies should downsize first before crosscutting analysis is conducted.

We believe that, to the extent the agencies actively pursue interagency

approaches as they restructure their respective RDT&E infrastructures, the

potential for success in ongoing efforts may be increased. Decision-making

on the size and scope of infrastructure needed by an individual agency in

the absence of information and consideration of related missions and

activities has resulted in decisions that are neither rational nor cost

effective when looked at from a broader perspective.1

 We and the agencies

agree that maintaining more RDT&E infrastructure than warranted by

requirements does not well serve the nation’s research needs and that

successful consolidation and reduction efforts are key ingredients to

assuring adequate resourcing of future research in science and technology.

1

See, for example, Electronic Combat: Consolidation Master Plan Does Not Appear to Be

Cost-Effective (GAO/NSIAD-97-10, July 10, 1997).

Page 66 GAO/NSIAD/RCED-98-23 Federal Laboratory Infrastructure
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Observations and Matters for Congressional

Consideration

Our perspective differs from the agencies’ in that we believe the best way

to achieve this end is through a governmentwide restructuring process.

DOD generally supported the findings in our report. For example, DOD said

that a significant reduction in infrastructure can only be achieved under

BRAC-like authority. However, DOD responded that (1) we did not give

appropriate weight to the role of the Congress in reducing infrastructure

by the BRAC process and to the reductions in RDT&E infrastructure prior to

the 1995 BRAC round, (2) the Vision 21 effort should not be listed as a lost

opportunity because it is expected to continue under existing authority,

(3) excess capacity expressed in work years may not necessarily match up

to excess physical facilities, (4) the personnel component of the RDT&E

infrastructure has been declining steadily by 4 to 5 percent annually since

1993, and (5) the supporting mission of the DOD laboratories and T&E

facilities in providing superior warfighting technology has never been

challenged. We agree fully with DOD on the need for an independent,

BRAC-like authority and recognize that the Congress has an important role

to play, as it has on prior occasions. We believe the extent DOD’s Vision 21

effort proceeds under existing authority may be largely dependent on

continuing congressional support for reductions. We acknowledge fully

that personnel reductions of the magnitude suggested by DOD have

occurred and continue under congressional mandates. However, we have

reported that, overall, defense civilian acquisition workforce costs are

about the same as they were in 1980 as measured in constant dollars.

DOE questioned the basic applicability of the best practices model, stating

that the scale and complexity of its R&D enterprise presents a much bigger

challenge than that faced by the Boeing Company Defense & Space Group

and the Ministry of Defence. We do not imply that the model could be

transplanted exactly to any organization or situation, but indicate that the

basic underlying principles and processes are key. For example, we report

that DOD’s Vision 21 process, which contains provisions for an independent

authority, inclusion of full operating costs, and strong mission focus

incorporated many of the same critical elements described in the model.

Further, while it is self-evident that differences in scale (and complexity)

may make it more difficult to overcome challenges and barriers, these

differences do not negate the validity of the process for different types of

organizations nor of the key elements employed in successful

consolidations. DOE also commented that (1) the end of the Cold War has

had a major direct effect on its mission and the mission of its laboratories,

(2) DOE’s Offices of Defense Programs, Nuclear Energy, and Energy

Research will declare excess an estimated 1,000 facilities over the 5-year

Page 67 GAO/NSIAD/RCED-98-23 Federal Laboratory Infrastructure
Chapter 5 

Observations and Matters for Congressional

Consideration

period from 1996 to 2000, (3) DOE laboratories have unique facilities and

capabilities that also serve other federal agencies, and (4) the agency’s

Laboratory Operations Board has developed a “Strategic Laboratories

Mission Plan.” We have reported that much of DOE’s “evolved mission” is

not unique, but is shared, at a minimum, with the NSF and the Department

of Commerce.

NASA said that (1) it has experienced upheaval, restructuring, downsizing,

and streamlining and has been reinventing itself since well before the 1995

National Performance Review, (2) it does not have an integrated financial

system, (3) a major objective of its strategic planning process is proper

sizing of its infrastructure, and (4) based on its Zero-Base Review, it has

made appropriate plans to implement closure of unnecessary facilities.

NASA also believed that by addressing the three major agencies in the same

report, we had overly generalized conclusions and overlooked its

accomplishments. We acknowledge fully the goals of NASA’s completed

Zero-Base Review in our report, but we conclude that it is unlikely that

NASA’s planned reductions will meet its own internal objectives.

NASA further commented that it was concerned about our publishing the

report because, in NASA’s opinion, the report did not meet our normal

standards, largely because NASA believes the report overlooks its

accomplishments in reducing RDT&E infrastructure while focusing on

governmentwide issues. While we recognize NASA’s accomplishments, we

also note that NASA has not closed any of its major facilities, as supported

by its own comments on this report.

Page 68 GAO/NSIAD/RCED-98-23 Federal Laboratory Infrastructure
Page 69 GAO/NSIAD/RCED-98-23 Federal Laboratory Infrastructure
Appendix I 

Comments From the Office of Management

and Budget

Note: GAO comments

supplementing those in the

report text appear at the

end of this appendix.

Now on p. 9.

See comment 1.

Now on p. 4.

See comment 2.

See comment 3.

See comment 4.

Page 70 GAO/NSIAD/RCED-98-23 Federal Laboratory Infrastructure
Appendix I 

Comments From the Office of Management

and Budget

Now on p. 61.

See comment 5.

Now on p. 62.

See comment 6.

Now on p. 60.

See comment 7.

Page 71 GAO/NSIAD/RCED-98-23 Federal Laboratory Infrastructure
Appendix I 

Comments From the Office of Management

and Budget

See comment 8.

Page 72 GAO/NSIAD/RCED-98-23 Federal Laboratory Infrastructure
Appendix I 

Comments From the Office of Management

and Budget

The following are GAO’s comments on the Office of Management and

Budget’s letter dated October 9, 1997.

GAO Comments 1. Our report states that, among the agencies we reviewed, only the

Department of Defense (DOD) has been assessed by an independent

authority charged with reducing infrastructure significantly, and those

reviews did not look across related agencies having significant research,

development, test, and evaluation (RDT&E) infrastructure such as the

Department of Energy (DOE) and the National Aeronautics and Space

Administration (NASA). The Office of Management and Budget (OMB) stated

in its comments that such a review has not been done and “...would be

simply too large at this time ....” We also changed the wording in the report

to better reflect OMB’s views concerning agencies’ progress in rationalizing

their RDT&E infrastructure.

2. We reported in detail the major actions taken by agencies in recent

years to reduce RDT&E infrastructure. We noted, however, that these

actions were almost exclusively intra-agency in nature and, with the

exception of base realignment and closure (BRAC) actions, generally did

not reduce significantly the number of major facilities.

3. We agree with OMB that making RDT&E infrastructure reductions may be

a difficult task. However, we disagree with OMB’s preferred strategy of first

restructuring the infrastructure of each individual agency before

examining them on an interagency basis. Pursuing such an approach that

has agencies individually conducting “stovepiped” reviews that ignore

similar and complementary infrastructure in other agencies may result in

unintended consequences (i.e., additional investments may be made in the

wrong areas or the wrong facilities may be closed or realigned).

4. We agree with OMB’s conclusion that the federal RDT&E infrastructure

should be examined as a whole. However, we believe the barriers to

reducing such infrastructure may best be attacked by conducting such

analyses before each agency completes individual infrastructure reviews.

5. The report discusses our analysis of NASA’s Zero-Base Review and gives

significant coverage of its objectives and results to date. It is encouraging

to note that OMB and NASA are using the Government Performance and

Results Act of 1993 (the Results Act) as a framework in their discussions

of RDT&E infrastructure.

Page 73 GAO/NSIAD/RCED-98-23 Federal Laboratory Infrastructure
Appendix I 

Comments From the Office of Management

and Budget

6. Although NASA is implementing an integrated financial management

system to improve the quality of data used for decision-making, NASA

officials have acknowledged that such a system will not likely provide

overall summary data in sufficient detail to provide comparative

efficiencies in the different facilities and installations that comprise the

RDT&E infrastructure.

7. DOD’s Vision 21 effort is currently at a standstill in its implementation.

However, it is encouraging that OMB and DOD have stated their intent to

resume the Vision 21 process at some time in the future, with or without

implementing BRAC legislation.

8. We have addressed all the relevant agency initiatives that deal with the

issues considered in this report and that were described as being fully

implemented at the time our review was performed.

Page 74 GAO/NSIAD/RCED-98-23 Federal Laboratory Infrastructure
Appendix II 

Comments From the Department of Energy

Note: GAO comments

supplementing those in the

report text appear at the

end of this appendix.

See comment 1.

See comment 2.

See comment 3.

Page 75 GAO/NSIAD/RCED-98-23 Federal Laboratory Infrastructure
Appendix II 

Comments From the Department of Energy

See comment 4.

See comment 5.

See comment 6.

See comment 7.

See comment 8.

Page 76 GAO/NSIAD/RCED-98-23 Federal Laboratory Infrastructure
Appendix II 

Comments From the Department of Energy

See comment 9.

Page 77 GAO/NSIAD/RCED-98-23 Federal Laboratory Infrastructure
Appendix II 

Comments From the Department of Energy

The following are GAO’s comments on the Department of Energy’s letter

dated October 1, 1997.

GAO Comments 1. Our review was conducted to address several objectives that are clearly

stated in the report. Nowhere among the objectives were there

“assumptions regarding the Department of Energy....” DOE incorrectly

characterizes as assumptions our findings regarding critical elements and

processes used by other organizations to consolidate successfully and

their applicability to DOE. Further, we have reported on (and continue to

report) DOE’s lack of mission focus and that some mission areas and

capabilities overlap with other federal agencies (i.e., the National Science

Foundation, the Department of Commerce, and the Environmental

Protection Agency, to name a few). Further, we note that managerial

imperatives such as (1) focused missions (through the Results Act

processes, strategic planning, or otherwise), (2) recognition of fiscal

constraints in decision-making, (3) an understanding of the full

implications of operating costs, and (4) strategies to overcome the effects

of cultural and structural barriers are (or should be) as broadly applicable

to federal managers as they are to managers applying “best practices” in

other organizations.

2. Our report reflects the emergence of the Stockpile Stewardship and

Management Program and its approach to assuring the viability of our

nuclear deterrent stockpile. We agree that the program’s success could

allow DOE to reduce significantly related infrastructure. However, during

our review, this had not yet been done.

3. DOE’s statement that over 1,000 facilities will be declared excess over the

5-year period (1996 to 2000) is an example of the magnitude and scope of

the federal RDT&E infrastructure that requires consolidation. We agree that

cleanup costs affect significantly the pace of closing such facilities.

4. Although some laboratories have some unique facilities and capabilities,

there are myriad areas of duplicative and overlapping capabilities in

federal agencies’ laboratories, both within and among agencies. The extent

of mission overlap between agencies must be addressed as part of the

Results Act process. Further, the extent of overlap and duplication of

capabilities, facilities, and research has been suggested by others as an

area that needs to be assessed.

Page 78 GAO/NSIAD/RCED-98-23 Federal Laboratory Infrastructure
Appendix II 

Comments From the Department of Energy

5. As stated in the report, the cited model was applied in the successful

consolidations by dissimilar organizations. It is self-evident that

differences in scale and complexity may make it more difficult to

overcome challenges and barriers. These differences, however, do not

negate the validity of the process for different types of organizations nor of

the key elements employed in successful consolidations. For example,

both DOD’s Vision 21 process and past BRAC rounds incorporated many of

the same critical elements described in the model.

6. To date, budget reductions have not been a sufficient catalyst for

change. Agencies have been able to defer effectively, if not indefinitely,

impacts of budget reductions by anticipating that funding will improve.

7. The report discusses DOE’s efforts to reform DOE laboratory management

processes and cites many other reports that also address this issue. Most

recently, we testified that DOE has failed to rationalize sufficiently its

laboratory infrastructure and has not reformed its burdensome

management structure. The Secretary of Energy’s Advisory Board recently

criticized the fact that individual DOE programs spread research dollars to

more laboratories than necessary, thus involving too many of them in too

many mission areas.

8. These plans are basically inventories of capabilities and ongoing efforts

rather than sources of vision and focus for future research. Further, the

House Committee on Government Reform and Oversight gave low marks

to DOE’s strategic planning in the area of identifying and addressing

overlapping/crosscutting functions during its Results Act assessment.

9. Although it is necessary to review small, mission-specific laboratories to

validate their roles and determine if there are alternatives, a process with

similar objectives focused on reducing governmentwide infrastructure

also appears warranted.

Page 79 GAO/NSIAD/RCED-98-23 Federal Laboratory Infrastructure
Appendix III 

Comments From the National Aeronautics

and Space Administration

Note: GAO comments

supplementing those in the

report text appear at the

end of this appendix.

See comment 1.

See comment 2.

Page 80 GAO/NSIAD/RCED-98-23 Federal Laboratory Infrastructure
Appendix III 

Comments From the National Aeronautics

and Space Administration

See comment 3.

See comment 4.

Page 81 GAO/NSIAD/RCED-98-23 Federal Laboratory Infrastructure
Appendix III 

Comments From the National Aeronautics

and Space Administration

The following are GAO’s comments on the National Aeronautics and Space

Administration’s letter dated September 8, 1997.

GAO Comments 1. Although an integrated financial system can play an important role in

providing greater insight into cost issues for decision-making, NASA

officials have acknowledged that even full implementation of NASA’s

integrated financial system will not likely provide the level of detailed

information necessary for successful infrastructure consolidation.

2. Our report recognizes that NASA has made a conscious decision not to

propose to the Congress the closing of a major center. The report also

discusses the objectives and results of NASA’s Zero-Base Review with

respect to infrastructure.

3. Nowhere in our report did we treat DOD, NASA, and DOE as a single

“entity.” We examined the agencies’ processes and infrastructure

reductions separately and have presented fact-based, agency-by-agency

evaluations of what has been achieved by agencies and what remains to be

done to date. We discuss the results of NASA’s Zero-Base Review with

respect to infrastructure and NASA’s accomplishments in infrastructure

resizing to date. Moreover, we would note that OMB, in commenting on our

draft report, indicated that implementation of NASA’s efforts to close a

number of facilities was just a beginning.

4. NASA expressed concern about our publishing this report because, in its

view, the report addresses the broad issue of RDT&E infrastructure of the

Departments of Defense and Energy and NASA as a single entity. NASA

believes this approach results in generalized and misleading statements

and broad, overall conclusions that overlook NASA’s individual

accomplishments in strategic planning, strategic management, reinvention,

and infrastructure resizing. We believe our report does recognize NASA’s

accomplishments. We updated and added examples of individual agency

infrastructure consolidation and reduction-related actions. The report also

notes that NASA’s most comprehensive infrastructure study—its 1995

Zero-Base Review—began with the premise that to meet its mission, NASA

needed the existing infrastructure. The model presented in this report

provides a different approach by suggesting that decisions regarding

mission be made first and then infrastructure aligned to support those

missions.

Page 82 GAO/NSIAD/RCED-98-23 Federal Laboratory Infrastructure
Appendix IV 

Comments From the Department of Defense

Note: GAO comments

supplementing those in the

report text appear at the

end of this appendix.

See comment 1.

See comment 2.

See comment 3.

Page 83 GAO/NSIAD/RCED-98-23 Federal Laboratory Infrastructure
Appendix IV 

Comments From the Department of Defense

See comment 4.

See comment 5.

See comment 6.

Page 84 GAO/NSIAD/RCED-98-23 Federal Laboratory Infrastructure
Appendix IV 

Comments From the Department of Defense

The following are GAO’s comments on the Department of Defense’s letter

dated October 1, 1997.

GAO Comments 1. Our report does discuss the role of congressionally directed BRAC rounds

in reductions of DOD infrastructure, and while it is true that the Congress

did not approve DOD’s latest request for additional BRAC rounds, DOD in its

Vision 21 process still can affect changes.

2. The report indicates that BRAC rounds led to the closure of over 60 RDT&E

facilities as well as related realignments. In DOD’s own estimate, it has not

reduced sufficiently its RDT&E infrastructure.

3. Although DOD asserts that it is in the best position to rationalize its own

RDT&E infrastructure, it was also the one federal agency asking for another

BRAC-like independent authority to oversee reductions in its RDT&E

infrastructure. We have not suggested that the agencies should play no

role in the design of their infrastructures. Moreover, the Boeing Company

Defense & Space Group and the Defence Research Agency largely

attributed the success of their efforts to the establishment of independent

authorities to implement change.

4. We agree with DOD that the likelihood of significant reductions in

infrastructure is enhanced immensely under BRAC-like authority. We note

in our report that the Vision 21 process is on hold and that its future

course had not been determined at the time we completed our review.

5. We agree with DOD that there has been a steady decline in acquisition

personnel levels associated with its laboratories and test and evaluation

(T&E) centers. Also, we recognize, and we have reported on, the difficulty

of measuring excess capacity in RDT&E infrastructure. However, the report

uses DOD’s own estimates of its excess capacity throughout.

6. The report already noted the relative clarity of missions and close ties

between DOD laboratories and T&E centers and their military customers, the

warfighters.

Page 85 GAO/NSIAD/RCED-98-23 Federal Laboratory Infrastructure
Appendix V 

Major Contributors to This Report

National Security and

International Affairs

Division, Washington,

D.C.

Katherine V. Schinasi, Project Director

Clifton E. Spruill, Project Manager

Mark A. Pross, Deputy Project Manager

James L. Morrison, Deputy Project Manager

Leslie E. Schafer, Senior Evaluator

Stacy Edwards, Evaluator

Nancy L. Ragsdale, Evaluator (Communications Analyst)

Resources,

Community, and

Economic

Development

Division, Washington,

D.C.

William J. Lanouette, Senior Evaluator

Page 86 GAO/NSIAD/RCED-98-23 Federal Laboratory Infrastructure
Glossary

Applied Research The National Science Foundation (NSF) and the Office of Management and

Budget (OMB) define applied research as “research directed toward the

acquisition of knowledge or understanding necessary for determining the

means by which a recognized and specific need may be met.” The

Department of Defense (DOD) defines applied research as “research

concerned with the practical application of knowledge, material, and/or

techniques directed toward a solution to an existent or anticipated military

requirement.”

Basic Research NSF and OMB define basic research as “research directed toward increases

in knowledge or understanding of the fundamental aspects of phenomena

and of observable facts without specific application toward processes or

products in mind.” DOD defines basic research as “efforts typically

performed in laboratories as experiments to explore the basic laws of

science and their potential application to DOD weapon systems or

technology development.”

Current Replacement

Value

DOD uses “plant replacement value” as an estimate of what it would cost to

replace all of the buildings, pavements, and utilities at its bases using

today’s building standards. The Department of Energy (DOE) uses

“replacement plant value” as the current cost to replace an existing

building with a new building. This value does not include the cost of the

underlying land. The estimate is based on assigning dollar values to usage

categories. DOE also uses “other structures and facilities replacement plant

value,” which is the cost to replace the existing structure with a new

structure of comparable size using current technology, codes, standards,

and materials. The National Aeronautics and Space Administration (NASA)

uses “current replacement value” to mean the acquisition cost of facilities,

excluding land, plus the cost of collateral equipment and incremental book

value charges escalated to the current year using a 20-city average cost

index for buildings.

Infrastructure DOD generally defines infrastructure as “all fixed and permanent

installations, fabrications, or facilities for the support and control of

military forces.” It consists of mission supporting property, plant,

equipment, and personnel, including contractor manpower. DOD excludes

the equipment and personnel necessary to perform directly critical

technical and acquisition functions. DOE defines infrastructure as “all real

property and installed equipment and personal property that is not solely

Page 87 GAO/NSIAD/RCED-98-23 Federal Laboratory Infrastructure
Glossary

supporting a single program mission.” NASA defines infrastructure as “the

underlying foundation for NASA operations, including its people, facilities,

equipment, business systems, institutional information systems, and

technical infrastructure.” Facilities are the land, buildings, structures,

permanently located trailers, and other real property improvements,

including utility systems and collateral equipment that essentially is

integrated into the facility. Business systems are business processes and

business tools. Institutional information systems include NASA computers,

networks, and general purpose application software. Technical

infrastructure includes mission/project/technology/science

implementation tools and processes, such as equipment and

instrumentation, processes and procedures, and software tools.

Laboratory DOD defines laboratory as “an activity (an aggregate of personnel and

facilities located at one base, under the same command) owned and

operated by a DOD component, that performs predominantly science and

technology, engineering development, systems engineering, engineering

support of deployed materiel and its modernization, and/or in-service

engineering work.” DOE defines laboratories functionally by the research

discipline housed in the particular building. DOE maintains laboratories for

the following functions: research and development (R&D) support,

meteorology and calibration, calibration, computation, applied science,

other support, chemistry, nonnuclear chemistry, nuclear chemistry, other

chemistry, optics, physics, applied physics, nuclear physics, other physics,

electrical/electronics, other electrical/electronics, communications,

biomedical research, biological research, medical research, human factors,

animal research, materials, environmental, radiation effects, research

reactor, general, non-nuclear general, nuclear general, and multi-function

research. NASA defines laboratory as “all of the activities and facilities at a

NASA center and subordinate organizational units that perform or support

the performance of research and development.”

Research, Development,

Test, and Evaluation

Research, development test, and evaluation (RDT&E) can be subdivided as

(1) science and technology (i.e., activities that produce or expand the use

of new knowledge and new or enabling technologies) and (2) systems

development (i.e., weapons systems in DOD, product demonstration,

testing, and evaluation such as nuclear work in DOE, and missions

operations and demonstrations in NASA). DOD, unlike other federal

agencies, subdivides its RDT&E funding into seven program element

categories, each with a numerical code: Basic Research (6.1), Exploratory

Page 88 GAO/NSIAD/RCED-98-23 Federal Laboratory Infrastructure
Glossary

Development (6.2), Advanced Technology Development (6.3),

Demonstration and Validation (6.4), Engineering and Manufacturing

Development (6.5), Management and Support (6.6), and Operational

Systems Support (6.7). The first three categories are comparable strictly to

the research and development reported by other agencies.

Science and Technology DOD defines science and technology as the first three program elements of

the seven RDT&E categories. The first three are Basic Research (6.1),

Exploratory Development (6.2), and Advanced Technology Development

(6.3). (Systems development corresponds to the other four DOD RDT&E

categories.)

Test and Evaluation DOD defines test and evaluation as “any project or program designed to

obtain, verify, and provide data for the evaluation of research and

development other than laboratory experiments for the purpose of

determining if the minimum operational performance requirements as

specified in the Operational Requirements Document have been satisfied.”

Page 89 GAO/NSIAD/RCED-98-23 Federal Laboratory Infrastructure
Glossary

Page 90 GAO/NSIAD/RCED-98-23 Federal Laboratory Infrastructure
Glossary

Page 91 GAO/NSIAD/RCED-98-23 Federal Laboratory Infrastructure
Related GAO Products

Aerospace Testing: Promise of Closer NASA/DOD Cooperation Remains

Largely Unfulfilled (GAO/NSIAD-98-52).

Department of Energy: Clearer Missions and Better Management Are

Needed at the National Laboratories (GAO/T-RCED-98-25, Oct. 9, 1997).

Military Bases: Lessons Learned From Prior Base Closure Rounds

(GAO/NSIAD-97-151, July 25, 1997).

Results Act: Observations on the Department of Energy’s Draft Strategic

Plan (GAO/RCED-97-199R, July 11, 1997).

Defense Acquisition Infrastructure: Changes in RDT&E Laboratories and

Centers (GAO/NSIAD-96-221BR, Sept. 13, 1996).

NASA Facilities: Challenges to Achieving Reductions and Efficiencies

(GAO/T-NSIAD-96-238, Sept. 11, 1996).

NASA Infrastructure: Challenges to Achieving Reductions and Efficiencies

(GAO/NSIAD-96-187, Sept. 9, 1996).

Department of Energy: Observations on the Future of the Department

(GAO/T-RCED-96-224, Sept. 4, 1996).

DOE’s Laboratory Facilities (GAO/RCED-96-183R, June 26, 1996).

Energy Downsizing: While DOE Is Achieving Budget Cuts, It Is Too Soon to

Gauge Effects (GAO/RCED-96-154, May 13, 1996).

FDA Laboratories: Magnitude of Benefits Associated With Consolidations Is

Questionable (GAO/HEHS-96-30, Mar. 19, 1996).

Federal R&D Laboratories (GAO/RCED/NSIAD-96-78R, Feb. 29, 1996).

Department of Energy: A Framework for Restructuring DOE and Its

Missions (GAO/RCED-95-197, Aug. 21, 1995).

Department of Energy: Need to Reevaluate Its Role and Missions

(GAO/T-RCED-95-85, Jan. 18, 1995).

Department of Energy: National Laboratories Need Clearer Missions and

Better Management (GAO/RCED-95-10, Jan. 27, 1995).

Page 92 GAO/NSIAD/RCED-98-23 Federal Laboratory Infrastructure
Related GAO Products

DOE’s National Laboratories: Adopting New Missions and Managing

Effectively Pose Significant Challenges (GAO/T-RCED-94-113, Feb. 3, 1994).

Federal Research: Aging Federal Laboratories Need Repairs and Upgrades

(GAO/RCED-93-203, Sept. 20, 1993).

Department of Energy: Management Problems Require a Long-Term

Commitment to Change (GAO/RCED-93-72, Aug. 31, 1993).

Federal Buildings: Actions Needed to Prevent Further Deterioration and

Obsolescence (GAO/GGD-91-57, May 13, 1991).

(707179) Page 93 GAO/NSIAD/RCED-98-23 Federal Laboratory Infrastructure
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