United States General Accounting Office

GAO Report to Congressional Requesters

December 1996 AIR FORCE DEPOT

MAINTENANCE

Privatization-in-Place

Plans Are Costly While

Excess Capacity Exists

G O A

years

1921 - 1996

GAO/NSIAD-97-13

GAO United States

General Accounting Office

Washington, D.C. 20548

National Security and

International Affairs Division

B-272658 

December 31, 1996

The Honorable Floyd Spence

Chairman, Committee on National Security

House of Representatives

The Honorable Don Nickles

United States Senate

As requested, we reviewed the Department of Defense’s (DOD) decision to

pursue privatization-in-place initiatives at two major Air Force

maintenance depots recommended for closure during the 1995 base

realignment and closure (BRAC) process. Specifically, we reviewed the Air

Force’s plans to privatize-in-place depot maintenance workloads at the

Sacramento and San Antonio air logistics centers and determined (1) the

impact on excess depot capacity and operating costs at the remaining

defense depots; (2) the cost-effectiveness of planned privatization

initiatives, including the impact of delaying base closures until the year

2001; and (3) compliance with statutory requirements.

Results in Brief As we stated in our April 1996 testimony on depot maintenance before the

Subcommittees on Readiness, House Committee on National Security and

Senate Committee on Armed Services, deciding the future of DOD’s depot

system is difficult. Depot maintenance privatization should be approached

carefully, allowing for evaluation of the economic, readiness, and statutory

requirements that surround individual workloads. Privatizing depot

maintenance activities, if not effectively managed, including the

downsizing of remaining DOD depot infrastructure, could exacerbate

existing excess capacity problems and the inefficiencies inherent in

underused depot maintenance capacity. Privatizing workloads in place at

two closing Air Force depots does not reduce the excess capacity in the

remaining depots or the private sector and consequently is not a

cost-effective approach to reducing depot infrastructure.1

Privatizing-in-place rather than closing and transferring the depot

maintenance workloads at the Sacramento and San Antonio air logistics

centers will leave a costly excess capacity situation at remaining Air Force

depots that a workload consolidation would have mitigated. Private

industry representatives generally agree that privatization-in-place does

1

Defense Depot Maintenance: Privatization and the Debate Over the Public-Private Mix

(GAO/T-NSIAD-96-146, Apr. 16, 1996) and (GAO/T-NSIAD-96-148, Apr. 17, 1996).

Page 1 GAO/NSIAD-97-13 Air Force Depot Maintenance
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not solve the excess capacity problem in the public and private sectors

and is not the most cost-effective closure option.

Although the Air Force’s privatization initiative for the Sacramento and

San Antonio depots has not progressed far enough for us to estimate

precisely costs and savings, consolidating depot maintenance workloads

at remaining underused depots could result in a net savings in 2 years or

less. Our work shows that transferring the depot maintenance workloads

to other depots could yield additional economy and efficiency savings of

over $200 million annually. These savings are in addition to the

$268 million annual savings the BRAC Commission estimated could be

achieved by eliminating the McClellan and Kelly infrastructures and

downsizing nonmaintenance personnel. Moreover, if the workload

consolidation does not occur, the remaining Air Force depots are likely to

become more inefficient and more costly, unless other workloads are

added, costly excess capacity is eliminated, or other efficiency and

economy initiatives are successfully implemented.

Plans to delay many closure-related actions until 2001 will substantially

reduce future savings envisioned by the BRAC Commission. Specifically,

our analysis shows that the delay could result in a net loss of

$644.4 million between 1997 and 2001 for the Air Force and $24 million for

the Army.

DOD stated that it will structure the San Antonio and Sacramento

privatizations to comply with existing statutory restrictions, including the

10 U.S.C. 2469 requirement that privatizing workloads valued at not less

than $3 million be done using competitive procedures that include both

public and private entities. Because the Department’s privatization plans

are still evolving, sufficient information is not available for us to assess

whether the conversion plans will comply with the existing law.

Background DOD annually spends about $15 billion—or about 6 percent of its

$243 billion fiscal year 1996 budget—on depot maintenance work that

involves the repair, overhaul, modification, and upgrading of aircraft,

ships, ground vehicles, and other equipment. Over $4 billion is spent on Air

Force systems and equipment. Most of the Air Force’s depot maintenance

work is performed at five depots that are located at its five air logistics

centers.

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Since the early 1970s, we and others have reported on the redundancies

and excess capacity that exist in DOD depots and the need to downsize and

improve the operational efficiency of these depots. These problems have

been exacerbated in recent years by reductions in military force structure

and related weapon system procurement; changes in military operational

requirements due to the end of the Cold War; increased reliability,

maintainability, and durability of military systems; increased maintenance

performed in operational units; and increased privatization of depot

maintenance workloads.

Beginning in the late 1980s, DOD—primarily through the BRAC

process—reduced some of its excess capacity by closing a number of

depots and transferring most workloads to remaining depots and some to

the private sector. Altogether, the first three BRAC rounds (1988, 1991, and

1993) resulted in recommendations to close nine Army and Navy depots

and the Air Force’s Aerospace Guidance and Metrology Center.2

 Despite

major force structure reductions and significant excess capacity in the Air

Force depot maintenance system, none of the Air Force’s five air logistics

centers or the large, multi-commodity depots contained within them were

recommended for closure during the first three BRAC rounds. As shown in

table 1, for fiscal year 1996, the five centers reported approximately

57.2 million direct labor hours of depot maintenance capacity and

accomplished about 31.5 million hours of work—leaving about 25.8 million

hours of excess capacity, or about 45 percent.

Table 1: Projected Fiscal Year 1996

Workload and Excess Capacity at the

Five Air Force Depots Excess capacity

Workload and capacity in direct labor hours

Depot

Maximum

capacity

Fiscal year

1996 workload Hours Percent

Oklahoma City 12,863,153 7,058,083 5,805,070 45

Ogden 9,004,515 5,146,999 3,857,516 43

San Antonio 15,219,752 6,372,607 8,847,145 58

Sacramento 10,226,981 5,509,051 4,717,930 46

Warner Robins 9,912,789 7,375,889 2,536,900 26

Total 57,227,190 31,462,629 25,764,561 45

Note: Capacity and workload data was reported by the military services and certified during the

1995 BRAC process.

2

Our report, Closing Depots: Savings, Workload, and Redistribution Issues (GAO/NSIAD-96-29, Mar. 4,

1996) contains information on the 10 depots recommended for closure during the first three BRAC

rounds and provides an overview of DOD’s depot maintenance system. Our report, Aerospace

Guidance and Metrology Center: Cost Growth and Other Factors Affect Closure and Privatization

(GAO/NSIAD-95-60, Dec. 9, 1994), addressed closure and privatization issues for that facility.

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1995 BRAC Process

Decisions

DOD’s February 1995 report to the BRAC Commission recommended

reducing excess Air Force depot maintenance capacity and costs by

downsizing all five air logistics centers, including their depots. DOD

estimated that this downsizing would require one-time costs of

$183 million and would result in net savings of $138.7 million during the

6-year implementation period. The downsizing was to be accomplished

through consolidating similar workloads, mothballing or disposing of plant

equipment, and tearing down buildings. The Commission also estimated

that annual savings would be $89 million after the implementation period

and that the net present value of all costs and savings over a 20-year period

would be $991.2 million.

The 1995 BRAC Commission concluded that DOD’s downsizing approach

would not adequately reduce infrastructure and overhead costs. It

recommended closing the Sacramento and San Antonio centers and

transferring their workloads to the remaining depots or private sector

commercial activities. In making its closure and workload transfer

recommendations, the Commission considered the effects on the local

communities, workload transfer costs, and potential effects on readiness.

It concluded that the savings and benefits outweighed the potential

drawbacks. The Commission’s report noted that given the significant

amount of excess depot capacity and limited DOD resources, closure is a

necessity. Further, closing these activities would improve the use of the

remaining centers and substantially reduce DOD operating costs. The

specific Commission recommendations were as follows:

• Realign Kelly Air Force Base, including the air logistics center; disestablish

the defense distribution depot; consolidate the workloads to other DOD

depots or to private sector commercial activities as determined by the

Defense Depot Maintenance Council;3

 and move the required equipment

and personnel to the receiving locations.

• Close McClellan Air Force Base, including the air logistics center;

disestablish the defense distribution depot; move the common-use ground

communication electronics to Tobyhanna Army Depot, Pennsylvania;

retain the radiation center and make it available for dual use and/or

research, or close as appropriate; consolidate the remaining workloads

with other DOD depots or private sector commercial activities as

determined by the Council; and move the required equipment and any

required personnel to receiving locations. All other activities and facilities

at the base will close.

3

The Defense Depot Maintenance Council is a senior-level council established to advise the Deputy

Under Secretary of Defense for Logistics on depot maintenance within DOD.

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The Commission estimated that these recommendations would require

one-time implementation costs of $822.6 million but would yield net

savings of $151.2 million during the 6-year implementation period. Further,

they would yield annual savings of $338.2 million after the implementation

period, about $70 million of which represented depot maintenance

savings. The projected depot maintenance savings were developed by

assuming that the number of depot maintenance personnel could be

reduced by 15 percent. The Commission estimated that the net present

value of savings over 20 years, including the 6-year implementation period,

would be $3.5 billion. The Commission’s savings projections did not

include savings from moving workloads to depots with lower labor rates,

consolidating workloads in underused facilities and reducing excess

capacity, increasing efficiency, and reducing the overhead rates at

receiving depots.

In considering the BRAC recommendations to close the two centers, the

President and the Secretary of Defense expressed concerns about the

near-term costs and potential effects on local communities and Air Force

readiness. In response to these concerns, the President, in forwarding the

Commission’s recommendations to Congress for approval, indicated that

the air logistics centers’ work should be privatized in place or in the local

communities. He also directed the Secretary of Defense to retain 

8,700 jobs at McClellan Air Force Base and 16,000 jobs at Kelly Air Force

Base until 2001 to further mitigate the closures’ impact on the local

communities. Additionally, the size of the workforce remaining in the

Sacramento and San Antonio areas through 2004 was expected to remain

above 4,350 and 11,000, respectively.

McClellan has about 2,600 personnel and San Antonio has about 

3,100 personnel assigned to organizations whose mission is to provide

various base support services (such as security; maintenance of buildings,

roads, and grounds; and medical clinic services) to the logistics center and

all tenants. Depot maintenance employees comprise 66 percent of the

Sacramento center personnel and 47 percent of the San Antonio center

personnel. The centers’ maintenance depots perform about $1.65 billion of

depot maintenance work annually, about $400 million of which belongs to

the other services and is done through interservicing. They also perform

other logistics functions such as engineering support and weapon system

and item management. Kelly Air Force Base had about 19,500 employees

at the time of the 1995 BRAC process—of which 12,850 were air logistics

center personnel, including 6,000 involved in depot maintenance. In

Page 5 GAO/NSIAD-97-13 Air Force Depot Maintenance
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addition to the air logistics center, Kelly has several other tenant activities,

including the Air Intelligence Agency, Defense Information Systems

Agency, Defense Distribution Depot, and guard and reserve units.

McClellan Air Force Base employed about 14,000 people—of which 7,314

were center employees, including 4,853 depot maintenance personnel. In

addition to the air logistics center, McClellan has a defense distribution

depot, Coast Guard air station, and reserve units.

Statutes Influencing the

Mix of Depot Maintenance

Workloads Between the

Public and Private Sectors

Several statutes influence the allocation of depot maintenance workloads

between the public and private sectors. According to 10 U.S.C. 2464, a

“core logistics capability” is to be identified by the Secretary of Defense

and maintained by DOD, unless the Secretary waives DOD performance as

not required for national defense. Further, 10 U.S.C. 2466 and 2469 limit

the extent to which depot-level workloads can be converted to private

sector performance. Section 2466 specifies that not more than 40 percent

of the funds allocated in a fiscal year for depot-level maintenance or repair

can be spent on private sector performance—the so-called “60/40” rule.

Section 2469 prohibits DOD from transferring in-house maintenance and

repair workloads valued at not less than $3 million to another DOD activity

without using “merit-based selection procedures for competitions” among

all DOD depots or to contractor performance without the use of

“competitive procedures for competitions among private and public sector

entities.”

Privatizing-in-Place Is

Not the Most

Cost-Effective

Approach Because

Excess Capacity Still

Exists

Privatizing defense depot activities in place could yield cost savings if

other public and private activities were more fully utilizing their

maintenance repair capacity. Because substantial excess capacity exists in

both the public and private sectors, privatizing Sacramento and San

Antonio workloads in place will result in missed opportunities to reduce

the overall cost of Air Force depot maintenance operations.

Excess Capacity Is Costly In recent years, depot maintenance rates have increased sharply. One of

the major reasons for this increase is that as requirements have declined,

the large fixed overhead costs for both the depots and the bases on which

they are located must be allocated to a smaller depot maintenance

workload base. As we noted previously, about 3,100 military and civilian

personnel are involved in base support operations at Kelly Air Force Base

Page 6 GAO/NSIAD-97-13 Air Force Depot Maintenance
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and 2,600 at McClellan Air Force Base. These operations support center

activities, including the depots, as well as other base tenant activities. It is

estimated that a military depot with several thousand employees incurs

fixed overhead costs of from $50 million to $100 million annually. By

closing bases, DOD can eliminate base support and depot maintenance

infrastructure and achieve substantial future savings. Additionally,

consolidating workloads from closing depots with workloads of

underused Air Force depots could yield additional savings at the receiving

depots by increasing their efficiency, spreading their fixed overhead costs

over a larger workload base, and lowering their average costs.

Privatizing-in-place does not substantially reduce infrastructure and

excess capacity. It just moves some of it to the private sector. Private

sector manufacturing and repair facilities also have extensive excess

capacity. The privatization-in-place of the Sacramento and San Antonio

depots will not reduce the large amount of excess capacity in the Air

Force depot system and the private sector or their associated costs, unless

additional facilities are closed or other cost-reduction means are

successfully implemented.

Consolidating Workloads

Could Produce Substantial

Savings

The Air Force’s planning has not progressed far enough to compare

precisely the cost of privatizing depot workloads in place with the cost of

transferring the work to other underused depots. However, because

privatization-in-place will have little effect on excess capacity at the

remaining depots, it is unlikely that any savings would offset the cost of

maintaining excess depot capacity.

The Navy’s experience closing naval aviation depots and consolidating

workloads at remaining Navy facilities provides useful insights regarding

the benefits of this closure option. According to Navy officials,

consolidating workloads from three closing naval aviation depots and

quickly moving most of this workload to the three remaining depots was

projected to reduce excess capacity and decrease the overhead rates at

remaining naval aviation depots. Capacity utilization was projected to

increase 35 percent as a result of this consolidation. The utilization rate for

each depot varies depending on the specific workload transfers and other

variables, such as the rate of decline of their pre-consolidation workload

base. Overall, the economy and efficiency improvements were projected to

decrease the overhead rates by 18 percent between fiscal years 1994 and

1997. Based on a 10-million hour workload program, the consolidation

could save an additional $100 million annually. Navy officials stated that

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because of the continuous decline in depot maintenance workloads and

other factors, anticipated savings cannot be measured precisely. However,

they noted that closing naval aviation depots and consolidating workloads

in the Navy’s remaining three depots has clearly improved efficiency and

lowered the cost of the Navy depot maintenance program.

Our analysis of BRAC Commission estimates indicates that the closure of

the depots at the San Antonio and Sacramento logistics centers were

expected to save about $70 million annually. Based on our analysis of Air

Force data, the actual savings could be as much as $206 million annually, if

the closing depots’ work is transferred to the remaining military depots.

The Commission’s estimate assumed that about 15 percent of the

maintenance personnel at the closing centers could be eliminated. This

evaluation did not attempt to measure economy and efficiency

improvements that resulted from workload consolidation. However, our

analysis indicates that transferring about 8.2 million hours of work from

the closing Air Force depots to the three remaining depots4

 would

(1) reduce these three depots’ excess capacity from about 46 percent to

about 8 percent, (2) lower the hourly rates by an average of $6.00 at

receiving locations, and (3) save as much as $182 million annually as a

result of economies of scale and other efficiencies.5

 This estimate was

based on a workload redistribution plan that would only relocate 

78 percent of the available hours to Air Force depots. This reallocation

plan was developed by the Joint Depot Cross Service Group during the

BRAC 1995 process. If our analysis had included a plan for redistributing all

10.5 million available hours of work, then our projected annual recurring

savings would have been higher. Similarly, the Army estimates that the

Commission-mandated transfer of about 1.2 million hours of ground

communications workload from the Sacramento depot to the Tobyhanna

Army Depot will save an additional $24 million.

According to financial management officials at the three remaining

centers, it will cost about $475 million to absorb all of the 10.5 million

direct labor hours of the Sacramento and San Antonio depot work

currently available for reallocation. Comparing this cost estimate to our

4

The Sacramento and San Antonio depots’ projected workload for fiscal year 1999 is 10.5 million hours;

however, to follow the workload allocation scheme developed for BRAC 1995 by the Joint Cross

Service Group for Depot Maintenance, we assumed that 2.3 million hours of work, or about 

21.9 percent of the total, would be transferred to Army and Navy depots.

5

Because of numerous uncertainties, it is impossible to precisely estimate the potential savings. For

example, we assumed that the C-5 workload would be moved from San Antonio to another depot, and

was included in the estimated $110 million cost for establishing C-5 capability at another military

depot, even though privatization—either in-place or at contractor facilities—would likely be the most

cost-effective alternative.

Page 8 GAO/NSIAD-97-13 Air Force Depot Maintenance
B-272658 

$206 million projected annual savings indicates that net savings would

occur within 2-1/2 years of the consolidation. Transition costs for moving

only 78 percent of that workload would be less; therefore, net savings

would occur in even less time if all of the 10.5 million direct labor hours

available for redistribution to Air Force depots were moved. Moreover,

$318 million of the projected $475 million are associated with the release

or movement of depot maintenance personnel, and the costs are about the

same for either option. DOD will incur these costs regardless of whether the

workload is moved to other military depots or privatized-in-place. It could

recoup the remaining $157 million in less than 1 year if the workloads

were consolidated at other Air Force depots. Additionally, over

$110 million of the remaining $157 million cost is required to support the

movement of the C-5 aircraft workload. A decision to privatize the C-5

workload in place or at a contractor facility would reduce transition costs

to between $50 million and $100 million, including the additional costs

estimated to be required for the privatization. Thus, the cost of moving all

but the C-5 is estimated to have a payback period of less than 8 months.

Finally, the potential $200 million annual savings that could result from the

consolidation is in addition to the BRAC Commission’s $268-million savings

estimate for eliminating base support operations and non-depot

maintenance personnel at the McClellan and Kelly Air Force Bases.

On the other hand, if the remaining depots do not receive additional

workload, they are likely to continue to operate with significant excess

capacity and become more inefficient and expensive as workloads

dwindle due to downsizing and privatization initiatives. If a depot is not

closed, excess capacity and costs could still be reduced by

downsizing-in-place and implementing various economy and efficiency

initiatives. However, the amount of the reduction could be minimal

without further workload consolidations and depot closures. Additionally,

the remaining Air Force depots are located on large multi-functional bases

that support other missions and optimum savings could not be achieved

unless the entire base is closed.

Subsequent to our analysis, the Air Force Materiel Command analyzed

potential savings from workload consolidation, including how increasing

the efficiency of underused military depots would lower fixed overhead

rates. This analysis showed that annual savings of $367 million can be

achieved through consolidation of workloads in remaining DOD depots.

Further, an additional $322 million could also be saved by relocating

workload to depots that already have lower hourly rates. Based on the Air

Page 9 GAO/NSIAD-97-13 Air Force Depot Maintenance
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Force analysis, payback of the projected $476 million workload relocation

cost would occur in less than 1 year.

Privatization-in-Place

Aggravates Excess

Capacity Problem in the

Private Sector

Excess capacity in the private sector is particularly acute for fixed-winged

aircraft; communications, electronics, and avionics equipment; and

engines. For example, in March 1996, we reported that private sector

contractors indicate they have enough excess capacity to accomplish all of

the projected depot workloads for six military engines: TF39, TF33, T63,

F108/CFM56, 501K, and LM2500.6

 These contractors also said they have

enough capacity to perform 75 percent of the military’s T56 engine

workload and 73 percent of its T700 engine workload.

According to industry representatives, the private sector has been

reducing its excess capacity through mergers, closures, and

consolidations, but DOD has not made comparable reductions in its

infrastructure. A recent Defense Science Board study team concluded that

privatization-in-place should be avoided, since it tends to preserve excess

capacity. A privatization task force comprised of top executives from the

aerospace industry that was formed by the governor of California in early

1996 concluded that privatization-in-place:

“inhibits the realization of cost savings intended from base closures and the performance

goal improvements that privatization is intended to achieve. Privatization-in-place,

therefore, does not solve the excess capacity problem within either the public or the

private sector of the defense industrial base.”

According to industry representatives, this approach to downsizing will

not achieve the intended objectives and is likely to be the most costly

option of all.

Workload

Redistribution

Strategy Is Still

Evolving

In August 1996, the Air Force announced its most recent strategy for

allocating the depot workloads at Sacramento and San Antonio, but details

are still evolving. The strategy indicates the workloads will be competed

and that one of the remaining public depots will be allowed to compete

with the private sector for each of the three large workload packages that

are being developed. However, this strategy may limit public and private

activities’ ability to compete and favor privatizing the workloads in place.

6

Depot Maintenance: Opportunities to Privatize Repair of Military Engines (GAO/NSIAD-96-33, 

Mar. 5, 1996).

Page 10 GAO/NSIAD-97-13 Air Force Depot Maintenance
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Initial Acquisition Strategy On August 16, 1996, the Air Force announced that it was revising its

strategy for allocating the workloads at Sacramento and San Antonio. The

Air Force’s plans initially focused on privatizing five prototype

workloads—three at Sacramento and two at San Antonio. The BRAC

Commission report specified that the Defense Depot Maintenance Council

should determine where depot maintenance workloads from the closing

Air Force depots should be moved. The Council approved the Air Force’s

plan for the five prototype workloads on February 1, 1996. Table 2 shows

the proposed prototype program, including the estimated annual value of

the workloads and the number of workers involved.

Table 2: Privatization-in-Place

Prototype Program Overview Dollars in millions

Center Workload Annual value Workers

Sacramento Hydraulics $ 43 328

Sacramento Electric accessories 38 212

Sacramento Software 30 343

San Antonio C-5 paint/depaint 20 143

San Antonio Fuel accessories 73 440

Total $204 1,466

The prototype workloads involved about 11 percent of the San Antonio

depot’s maintenance personnel and about 27 percent of the Sacramento

depot’s personnel. Request for proposals were to be issued during the

third quarter of fiscal year 1996 for the software and C-5 paint/depaint

workloads and during the fourth quarter of fiscal year 1996 for the

hydraulics, electrical accessories, and fuel accessories. Contract awards

were projected for the first quarter of fiscal year 1997 for the hydraulics,

software, C-5 paint/depaint, and fuel accessories workloads, and the

second quarter of fiscal year 1997 for electronic accessories.

Shortly after the Defense Depot Maintenance Council approved the

prototype program, DOD began to question the appropriateness of the

concept. Community and industry groups expressed an interest in having

larger packages, and DOD officials were concerned about the cost of

administering a large number of smaller contracts. Additionally, a March 4,

1996, privatization task force created by the Governor of California

concluded that:

while privatization is desirable and will deliver more for the defense dollar, the more

restrictive Privatization-in-Place is counterintuitive. The Department of Defense is

expecting the private sector, which already carries significant excess capacity due to

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defense downsizing, to be willing to take on workload to be performed at a closing base.

Success is only possible if offerings are structured as viable business opportunities with

ongoing potential and if the opportunities are strongly supported by the communities

involved.7

Revised Acquisition

Strategy

Implementation of the prototype concept was put on hold in May 1996 as

the Air Force considered various options. Shortly thereafter, Air Force

planners began to focus on a concept that would involve several large

consolidated work packages, essentially one at Sacramento and two at San

Antonio (one for the C-5 aircraft and one for engines). The Defense Depot

Maintenance Council approved the revised acquisition strategy in

August 1996. However, the 10 U.S.C. 2466 provision that limits private

sector depot maintenance performance to no more than 40 percent—the

60/40 rule—constrains the Air Force’s ability to privatize depot

maintenance workloads. DOD has requested that Congress repeal this

provision and other statutes affecting the allocation of depot maintenance

workloads between the public and private sectors.

Air Force planners project that about $600 million of the two depots’ 

$1.65 billion workload will be available to transfer to the private sector. If

the 60/40 provision is not repealed in the future, the remaining 

$1.05 billion workload will be transferred to other military depots. This

will substantially increase the use of these depots and reduce their labor

hour rates for all workloads. If the 60/40 provision is repealed, DOD will

need to eliminate substantial excess capacity at the military depots to

reduce the cost impact of further privatization. In addition to the 60/40

provision, Air Force officials stated that they intend to comply with the 10

U.S.C. 2469 provision requiring public/private competitions before

transferring depot-level workloads valued at not less than $3 million to the

private sector.

Under the revised strategy, one request for proposals will be issued for all

Sacramento workloads that are proposed to be privatized-in-place,

including A-10 and KC-135 aircraft, hydraulics, instruments and electronic

accessories, and software. Air Force planners estimated the value of the

Sacramento workload to be about $220 million annually, with a projected

2,200 workers involved. According to Air Force officials, the Sacramento

work package can be privatized without breaching the 60/40 provision.

The Air Force is following a three-phased approach for competing the

Sacramento workload. The first phase began on November 8, 1996, with

7

Pathway to Privatization—An Industry Perspective, Report of the California Chief Executive Officers’

Defense Privatization Task Force to Governor Pete Wilson (Mar. 4, 1996).

Page 12 GAO/NSIAD-97-13 Air Force Depot Maintenance
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the issuance of a request for proposals for a study to analyze the

Sacramento depot workload, explore approaches for process

improvement, and make recommendations for the maintenance contract

solicitation. The Air Force anticipates awarding study contracts to one or

two offerors for about $750,000 in January 1997. The second phase, the

contract study, is scheduled to run until September 1997, although the Air

Force plans to issue a request for proposals for the maintenance contract

in July 1997. The final phase, the award of the maintenance contract, is

expected in January 1998.

A two-pronged acquisition strategy has been proposed for San Antonio.

One request for proposals is for the C-5 aircraft business area, which has

an annual value of $155 million and involves about 1,200 workers. The Air

Force issued a draft request for proposals for the C-5 workload in

November 1996. The strategy for San Antonio’s engine business area is

uncertain, largely because of the 60/40 provision. According to Air Force

officials, since the 60/40 provision has not been repealed, only a portion of

the $700 million San Antonio engine workload can be privatized along with

the other proposed packages. Air Force planners estimated that about

$240 million of San Antonio’s engine workload could be privatized without

breaching the 60/40 threshold. This limitation would likely allow

privatization of only one, or portions of all three, of San Antonio’s three

large engine workloads.

Because of the 60/40 provision, preliminary Air Force plans provide for

some workloads to be transferred to the three remaining Air Force depots.

These transfers would include electrical components, automatic test

equipment hardware, F-15 workload and gas turbine engines, and engine

workloads over the 60/40 limitation. San Antonio and Sacramento local

manufacturing workloads would also be transferred to one of the three

remaining Air Force depots in 2001. Personnel associated with the weapon

system and item management functions at the closing centers are also

scheduled to be transferred in 2001 to one of the three remaining air

logistics centers or to one of the Air Force product centers that manage

the acquisition of Air Force systems and equipment. Further, the Air Force

microelectronics facility located at the Sacramento depot will transfer to

the Defense Logistics Agency. This approximately 140-person operation

will continue to function in its current location, with the Defense Logistics

Agency likely to assume ownership of the depot plant equipment and lease

the building from the local reuse authority.

Page 13 GAO/NSIAD-97-13 Air Force Depot Maintenance
B-272658 

Strategy May Limit Public

and Private Competition

and Favors

Privatizing-in-Place

The Air Force’s revised strategy of competing large consolidated

workloads may limit competition from military depots. According to Air

Force officials, the solicitation requires that all the work be performed at a

single location, does not allow military depots to jointly compete for the

work, and only allows one depot to compete for each of the three large

workload packages. The competing Air Force depot will not be allowed to

subcontract work to a private contractor or to propose maintaining any of

the workloads in place. Since no single military depot can currently

perform all the work for two of the consolidated packages, the ability of

the military depots to compete may be limited. The single location

requirement also prohibits contractors from moving individual workloads

to multiple underused private sector facilities. Also, the plan to privatize

the Defense Logistics Agency supply depots at the Sacramento and San

Antonio locations provides an incentive to perform the work at the same

location.

Core Capability

Requirements May

Affect Privatization

Plans

According to 10 U.S.C 2464, DOD activities must maintain a core logistics

capability, including personnel, equipment, and facilities sufficient to

provide the technical competence and resources necessary for effective

and timely response to a mobilization or other national defense

emergency. DOD facilities are to retain core capability unless the Secretary

waives DOD performance as not being required for national defense. Air

Force data developed and certified during the 1995 BRAC process indicated

that about 77 percent of Sacramento’s and 70 percent of San Antonio’s

projected fiscal year 1996 depot maintenance workload represented core

capability. As a result, the Air Force cannot fully implement

privatization-in-place plans for Sacramento and San Antonio without

executing a waiver and reporting to Congress.

In April 1996, DOD provided Congress a depot maintenance policy report

that included a new process for evaluating core. The report said that the

military services would conduct a risk assessment before privatizing

mission-essential workloads, which previously would have been identified

as core.8

 As we reported on May 21, 1996, DOD’s policy report described a

model for making these assessments, but did not provide criteria for

evaluating private sector capabilities, establishing risk thresholds, and

making best value determinations.9

 Additionally, we noted that (1) such

8

Report on Policy Regarding Performance of Depot-Level Maintenance and Repair, Department of

Defense (Apr. 4, 1996).

9

Defense Depot Maintenance: DOD’s Policy Report Leaves Future Role of Depot System Uncertain

(GAO/NSIAD-96-165, May 21, 1996).

Page 14 GAO/NSIAD-97-13 Air Force Depot Maintenance
B-272658 

criteria is critical to both implementing the model and determining

whether mission-essential workloads previously determined to be core

capability and performed in military depots can be outsourced at

acceptable levels of risk and (2) until this guidance and criteria are

established and implemented, the core requirements that will result from

the new policy cannot be predicted with any precision. Also, DOD has not

yet developed a standardized process for assessing core capability,

including a documented risk assessment that evaluates private sector

repair capability. As a result, each military service was independently

planning and developing its own risk assessment process.

While the Air Force is developing a process for reassessing core

requirements, evaluations of the Sacramento and San Antonio depot

maintenance workloads proposed for privatization have not yet been

completed. It is uncertain to what extent the Air Force will determine that

mission-essential workloads previously defined as core should be

privatized. However, the Air Force has issued draft request for proposals

involving workloads previously identified as core without obtaining

waivers or redefining the workload as noncore.

Delaying Closure and

Realignment Will Be

Costly

To reduce the closures’ effect on the Sacramento and San Antonio

communities, DOD plans to delay closing McClellan Air Force Base and

parts of the Kelly Air Force Base until 2001, thereby retaining 8,700 jobs at

McClellan and 16,000 jobs at Kelly. This delay will eliminate much of the

$973.8 million savings estimated by the BRAC Commission to result from

reduced personnel and operating costs beginning in 1997. These savings

were to offset one-time closure costs of $822.6 million.

BRAC Commission Cost

and Savings Estimates

As shown in table 3, the BRAC Commission projected a net savings of

$151.2 million during the 6-year implementation period after projected

implementation costs of $822.6 million are deducted from the projected

total savings. The savings were to be achieved by reducing personnel

requirements and operating costs. However, these savings were expected

to be partially offset by one-time implementation costs for such things as

the transfer of personnel and equipment to new sources of repair.

Page 15 GAO/NSIAD-97-13 Air Force Depot Maintenance
B-272658 

Table 3: BRAC Commission’s Cost and Savings Estimates for Mcclellan and Kelly Air Force Bases

Fiscal year

Dollars in millions

1996 1997 1998 1999 2000 2001 Total

Total savings 0 $36.1 $112.1 $199.3 $286.1 $340.3 $973.8

Implementation costs $8.8 202.9 225.3 184.3 201.2 822.6

Net savings/(costs) ($8.8) ($166.9) ($113.2) $15.0 $84.8 $340.3 $151.2

Note: Costs and savings were calculated in fiscal year 1996 dollars. Totals may not add due to

rounding.

Implementation Delays

Would Reduce Savings

The cost impact of the decision to delay the closures depends on how long

they are delayed. For example, a 1-year delay would reduce the BRAC

Commission’s projected savings by about $90 million, whereas a 4-year

delay would reduce savings by about $796 million.10

The BRAC Commission expected $845.6 million, or 86.8 percent, of the

$973.8 million implementation period savings to be achieved through

personnel reductions. It expected that closing the Sacramento and San

Antonio centers would eliminate 6,316 military and civilian positions. The

personnel reductions were to start in fiscal year 1997 and be completed by

the end of fiscal year 2000.

The financial benefit of eliminating positions as early as possible becomes

readily apparent when the impact is tracked into subsequent years. For

example, the BRAC Commission projected that 1,378 positions would be

eliminated in fiscal year 1997, which would save $31.8 million during the

first year and $63.5 million every year thereafter.11 Eliminating these

positions was expected to save $285.8 million during the implementation

period. Table 4 shows how the estimated savings will be affected.

10A 4-year delay costs significantly more per year than a 1-year delay because it pushes back the time

period when savings will exceed costs (as shown in table 4). These are one-time costs for extending

operations at the centers.

11The Commission assumed that the position eliminations would be spread evenly throughout the year

and that first-year savings would, therefore, be half the annual recurring savings.

Page 16 GAO/NSIAD-97-13 Air Force Depot Maintenance
B-272658 

Table 4: Impact on Savings Caused by Delaying the Elimination of 1,378 Positions

Savings achieved during fiscal year

Dollars in millions

Fiscal year of

personnel reduction 1997 1998 1999 2000 2001 Total savings

Change in

savings

1997 $31.8 $63.5 $63.5 $63.5 $63.5 $285.8 0

1998 31.8 63.5 63.5 63.5 222.3 ($63.5)

1999 31.8 63.5 63.5 158.8 (127.0)

2000 31.8 63.5 95.3 (190.6)

2001 31.8 31.8 (254.1)

Note: Savings were calculated in fiscal year 1996 dollars. Totals may not add due to rounding.

Table 5 shows the impact that implementation delays will have on the

Commission’s net savings estimates, assuming that all costs and savings

remain the same and are simply delayed.

Table 5: Impact of Closure Delays on

Net Savings or Costs for Fiscal Years

1996 to 2001

Dollars in millions

Length of delay Net savings (costs) Change in savings

No delay (savings start in 1997) $151.2 0

1-year delay (savings start in 1998) 60.6 ($90.6)

2-year delay (savings start in 1999) (93.2) (244.5)

3-year delay (savings start in 2000) (333.7) (484.9)

4-year delay (savings start in 2001) (644.4) (795.6)

Note: Costs and savings were calculated in fiscal year 1996 dollars. Totals may not add due to

rounding.

Transfer of Workloads to

Tobyhanna Army Depot

Delayed Until 2001

The BRAC Commission’s recommendation to transfer common-use ground

communication-electronics workload from the Sacramento depot—about

1.2 million direct labor hours of work—to the Tobyhanna Army Depot

would increase Tobyhanna’s capacity utilization from 49 percent to 

65 percent, reduce Tobyhanna’s hourly labor rate by $6 (from $64 to $58),

and save about $24 million annually. This workload includes repairing and

overhauling such items as radar, radio communications, electronic

warfare, navigational aids, electro-optic and night-vision devices, satellite

sensors, and cryptographic security equipment.

The Air Force, with the approval of the Defense Depot Maintenance

Council, is delaying the transfer of this workload to Tobyhanna until 2001

Page 17 GAO/NSIAD-97-13 Air Force Depot Maintenance
B-272658 

to support personnel retention goals in the Sacramento area. As we

recently reported, this delay will decrease savings and result in interim

personnel reductions at Tobyhanna.12 According to Army officials,

delaying all of the workload transfers to Tobyhanna until 2001 could

require the depot to undergo a reduction-in-force, followed by a costly

rehiring and retraining situation when it does eventually receive the Air

Force workloads. Because its workload has been declining, Tobyhanna

has already voluntarily separated about 250 of its personnel during 1996.

Army officials said that about 800 personnel may be involuntarily

separated in fiscal years 1997 or 1998 if no additional workloads are

transferred to Tobyhanna. This reduction would include the loss of

personnel having critical skills and competencies needed to work on the

ground communications workload.

Statutes Affect Efforts

to Privatize

Workloads

As we previously reported, various statutory restrictions may affect how

much of the depot-level workloads can be transferred to the private

sector—through privatization-in-place or otherwise. They include 10

U.S.C. 2464, 10 U.S.C. 2466, and 10 U.S.C. 2469. While each of these

statutes has some affect on the allocation of DOD’s depot-level workload,

10 U.S.C. 2469 constitutes the primary impediment to privatization in the

absence of a public-private competition.

Competition requirements of 10 U.S.C. 2469 have broad application to all

changes to the depot-level workload valued at not less than $3 million that

is currently performed at DOD installations, which include Kelly and

McClellan. They require DOD to give other public depots the opportunity to

compete for the closing depots’ workloads. The statute does not provide

any exemptions from its competition requirements and, unlike most of the

other laws governing depot maintenance, does not contain a waiver

provision. Further, there is nothing in the Defense Base Closure and

Realignment Act of 1990—the authority for the BRAC

recommendations—that, in our view, would permit the implementation of

a recommendation involving privatization outside of the competition

requirements of 10 U.S.C. 2469.

The determination of whether any single conversion to private sector

performance conforms to the requirements of 10 U.S.C. 2469 depends

upon the facts applicable to the particular conversion. While DOD has

stated that it will structure these conversions to comply with existing

12Army Depot Maintenance: Privatization Without Further Downsizing Increases Costly Excess

Capacity (GAO/NSIAD-96-201, Sept. 18, 1996).

Page 18 GAO/NSIAD-97-13 Air Force Depot Maintenance
B-272658 

statutory restrictions, details of its privatization plans for Kelly and

McClellan are still evolving. Sufficient information regarding the detailed

procedures for conducting the competitions for the Sacramento and San

Antonio workloads is not available for us to assess whether the planned

conversions will comply with the requirements of existing law. Further,

the planned privatizations at Sacramento and San Antonio are now the

subject of litigation. In March 1996, the American Federation of

Government Employees filed a lawsuit challenging these privatization

initiatives, contending that they violate the public-private competition

requirements of 10 U.S.C. 2469 and other depot maintenance statutes.13

Recommendations We recommend that the Secretary of Defense require the Secretary of the

Air Force to take the following actions:

• Develop required capability in military depots to sustain core depot repair

and maintenance capability for Air Force systems and conduct and

adequately document a risk assessment for mission-essential workloads

being considered for privatization at the San Antonio and Sacramento

depots.

• Before privatizing any Sacramento or San Antonio workload, complete a

cost analysis that considers the savings potential of consolidating the San

Antonio and Sacramento depot maintenance workloads at other DOD

depots, including savings that can be achieved for existing workloads by

reducing overhead rates through more efficient capacity utilization of

fixed overhead at underused military depots that could receive this

workload.

• Use competitive procedures, where applicable, for determining the most

cost-effective source of repair for workloads at the closing Air Force

depots.

• Reconsider plans to delay (1) the transfer of the ground communications

and electronics workload from the Sacramento Depot to Tobyhanna and

(2) other delays in transferring workload to the public or private sector

that are reducing savings estimated by the BRAC Commission to be

achieved from closure and consolidation.

Agency Comments

and Our Evaluation

DOD provided oral comments on our draft report. It concurred with each of

our recommendations and made several technical comments that have

been incorporated where appropriate. DOD also noted several actions it is

taking to respond to our recommendations. Specifically:

13American Federation of Government Employees v. Clinton, No. C2 (96-0283 (S.D. Ohio 1996)).

Page 19 GAO/NSIAD-97-13 Air Force Depot Maintenance
B-272658 

• DOD and the Secretary of the Air Force will develop the required capability

in military depots to sustain core depot repair and maintenance

capabilities for Air Force systems. Furthermore, the Air Force is in the

process of conducting and documenting a risk assessment of the capability

for those workloads being considered for public-private competition at the

San Antonio and Sacramento depots.

• DOD agreed to consider potential savings from consolidating the San

Antonio and Sacramento depot maintenance workloads at other DOD

depots as a part of its planned evaluation of the public-private

competitions for these workloads.

• DOD plans to use public-private competitions for determining the most

cost-effective source of repair for depot workloads at Sacramento and San

Antonio.

• DOD and the Air Force are working closely to finalize plans for transferring

the ground and electronics workload from the Sacramento Depot to

Tobyhanna. DOD’s response did not address its position regarding delays in

transferring other Sacramento and San Antonio workloads not expected to

be included in the public-private competitions. Air Force officials stated

that they are considering various options for these workloads that include

both private and public sector sources.

Scope and

Methodology

We obtained information from and interviewed officials at the Office of the

Secretary of Defense; Air Force Headquarters, Washington, D.C.; Air Force

Materiel Command Headquarters, Wright-Paterson Air Force Base, Ohio;

the Sacramento Air Logistics Center, McClellan Air Force Base, California;

the San Antonio Air Logistics Center, Kelly Air Force Base, Texas; the

Warner Robins Air Logistics Center, Robins Air Force Base, Georgia; the

Ogden Air Logistics Center, Hill Air Force Base, Utah; the Oklahoma City

Air Logistics Center, Tinker Air Force Base, Oklahoma; the Aerospace

Guidance and Metrology Center and Defense Contract Management Office,

Newark Air Force Base, Ohio; the Joint Depot Maintenance Analysis

Group, Gentile Station, Dayton, Ohio; the Army Industrial Operations

Command, Rock Island, Illinois; the Naval Air Systems Command,

Washington, D.C.; and the Naval Aviation Depot Operations Center, Naval

Air Station, Patuxent River, Maryland. We also discussed

privatization-in-place issues with Sacramento and San Antonio community

leaders and the Defense Contract Audit Agency. This work was part of a

broad-based review of depot maintenance requirements, capability, and

workload distribution issues. A list of related products is provided at the

end of this report.

Page 20 GAO/NSIAD-97-13 Air Force Depot Maintenance
B-272658 

To evaluate DOD’s rationale for (1) delaying the closure of McClellan Air

Force Base and the realignment of Kelly Air Force Base and (2) privatizing

the Sacramento and San Antonio air logistics centers’ depot maintenance

workloads, we reviewed various documents, including the Secretary of

Defense’s July 13, 1995, letter to the President and a July 13, 1995, White

House press release. We then discussed this rationale with DOD, Air Force

Material Command, and air logistics center officials.

Because Air Force officials have not yet determined how or when

privatization-in-place will be implemented at the two closing depots,

neither we nor the Air Force can develop precise costs and savings

estimates. As a result, we (1) reviewed the BRAC Commission’s cost and

savings estimates and (2) estimated the “economy of scale” savings that

could be achieved by using the closing depots’ workloads to reduce excess

capacity in the remaining depots.

To estimate the potential from transferring the closing depots’ workloads

to the remaining depots, we allocated 8.2 million hours of work, or about

78 percent of the projected fiscal year 1999 workload, to the three

remaining centers. We used a scheme developed for BRAC 1995 by the Joint

Cross Service Group for Depot Maintenance, but modified it slightly.

Based on input from Air Force Materiel Command and Center officials, we

assumed that the C-5 workload would be transferred to the Warner Robins

Air Logistics Center rather than the Oklahoma City Air Logistics Center.

We provided each center with a breakout of the transferring workload

they would receive by commodity group. We then asked center personnel

to estimate how additional workloads would affect their hourly rates by

analyzing fixed- and variable-cost categories, excluding material, which we

assumed would not change. The three centers used the approach and

assumptions developed by executive business planners from all five

centers to develop the downsize-in-place Air Force proposal developed

during the 1995 BRAC round as an alternative to closing depots.

We discussed the methodology with workload and privatization officials at

the Air Force Materiel Command. They agreed that our approach was

sound for assessing the impact of additional workload on a depot’s rate

structure. We also provided the closing centers with an opportunity to

comment on our methodology. San Antonio center officials agreed with

the general approach, but commented that increases in variable costs were

subjective. Sacramento center officials chose not to comment.

Page 21 GAO/NSIAD-97-13 Air Force Depot Maintenance
B-272658 

To determine whether Air Force plans for privatizing the closing depots is

consistent with (1) laws relating to the allocation of depot maintenance

workloads to the private sector and (2) the BRAC Commission’s

recommendations, we identified the applicable requirements and

determined their impact on DOD’s plans to privatize depot-level

maintenance workloads.

We conducted our review between October 1995 and October 1996 in

accordance with generally accepted government auditing standards.

We are sending copies of this report to the Secretary of Defense; the

Secretary of the Air Force; the Director, Office of Management and

Budget; and interested congressional committees. Copies will be made

available to others upon request. If you have any questions, please contact

me at (202) 512-8412. Major contributors to this report are listed in

appendix I.

David R. Warren, Director

Defense Management Issues

Page 22 GAO/NSIAD-97-13 Air Force Depot Maintenance
Page 23 GAO/NSIAD-97-13 Air Force Depot Maintenance
Appendix I 

Major Contributors to This Report

National Security and

International Affairs

Division, Washington,

D.C.

James F. Wiggins, Associate Director

Julia C. Denman, Assistant Director

M. Glenn Knoepfle, Senior Evaluator

Office of General

Counsel

John G. Brosnan, Assistant General Counsel

San Francisco Field

Office

Karl J. Gustafson, Evaluator-in-Charge

John M. Schaefer, Senior Evaluator

Eddie W. Uyekawa, Senior Evaluator

Jonathan M. Silverman, Writer-Editor

Dallas Field Office Larry J. Junek, Evaluator-in-Charge

John D. Strong, Senior Evaluator

Page 24 GAO/NSIAD-97-13 Air Force Depot Maintenance
Appendix I 

Major Contributors to This Report

Page 25 GAO/NSIAD-97-13 Air Force Depot Maintenance
Appendix I 

Major Contributors to This Report

Page 26 GAO/NSIAD-97-13 Air Force Depot Maintenance
Related GAO Products

Army Depot Maintenance: Privatization Without Further Downsizing

Increases Costly Excess Capacity (GAO/NSIAD-96-201, Sept. 18, 1996).

Navy Depot Maintenance: Cost and Savings Issues Related to

Privatizing-in-Place the Louisville, Kentucky Depot (GAO/NSIAD-96-202, 

Sept. 18, 1996).

Defense Depot Maintenance: Commission on Roles and Mission’s

Privatization Assumptions Are Questionable (GAO/NSIAD-96-161, July 15,

1996).

Defense Depot Maintenance: DOD’s Policy Report Leaves Future Role of

Depot System Uncertain (GAO/NSIAD-96-165, May 21, 1996).

Defense Depot Maintenance: More Comprehensive and Consistent

Workload Data Needed for Decisionmakers (GAO/NSIAD-96-166, May 21, 1996).

Defense Depot Maintenance: Privatization and the Debate Over the

Public-Private Mix (GAO/T-NSIAD-96-146, Apr. 16, 1996 ) and (GAO/T-NSIAD-96-148,

Apr. 17, 1996).

Military Bases: Closure and Realignment Savings Are Significant, but Not

Easily Quantified (GAO/NSIAD-96-67, Apr. 8, 1996).

Depot Maintenance: Opportunities to Privatize Repair of Military Engines

(GAO/NSIAD-96-33, Mar. 5, 1996).

Closing Maintenance Depots: Savings, Personnel, and Workload

Redistribution Issues (GAO/NSIAD-96-29, Mar. 4, 1996).

Navy Maintenance: Assessment of the Public-Private Competition Program

for Aviation Maintenance (GAO/NSIAD-96-30, Jan. 22, 1996).

Depot Maintenance: The Navy’s Decision to Stop F/A-18 Repairs at Ogden

Air Logistics Center (GAO/NSIAD-96-31, Dec. 15, 1995).

Military Bases: Case Studies on Selected Bases Closed in 1988 and 1991

(GAO/NSIAD-95-139, Aug. 15, 1995).

Military Base Closure: Analysis of DOD’s Process and Recommendations

for 1995 (GAO/T-NSIAD-95-132, Apr. 17, 1995).

Page 27 GAO/NSIAD-97-13 Air Force Depot Maintenance
Related GAO Products

Military Bases: Analysis of DOD’s 1995 Process and Recommendations for

Closure and Realignment (GAO/NSIAD-95-133, Apr. 14, 1995).

Aerospace Guidance and Metrology Center: Cost Growth and Other

Factors Affect Closure and Privatization (GAO/NSIAD-95-60, Dec. 9, 1994).

Navy Maintenance: Assessment of the Public and Private Shipyard

Competition Program (GAO/NSIAD-94-184, May 25, 1994).

Depot Maintenance: Issues in Allocating Workload Between the Public and

Private Sectors (GAO/T-NSIAD-94-161, Apr. 12, 1994).

Depot Maintenance (GAO/NSIAD-93-292R, Sept. 30, 1993).

Depot Maintenance: Issues in Management and Restructuring to Support a

Downsized Military (GAO/T-NSIAD-93-13, May 6, 1993).

Air Logistics Center Indicators (GAO/NSIAD-93-146R, Feb. 25, 1993).

Defense Force Management: Challenges Facing DOD As it Continues to

Downsize its Civilian Workforce (GAO/NSIAD-93-123, Feb. 12, 1993).

Navy Maintenance: Public/Private Competition for F-14 Aircraft

Maintenance (GAO/NSIAD-92-143, May 20, 1992).

Military Bases: Information on Air Logistics Centers (GAO/NSIAD-90-287FS,

Sept. 10, 1990).

(709186) Page 28 GAO/NSIAD-97-13 Air Force Depot Maintenance
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