Defense Infrastructure: DOD Needs to Periodically Review Support Standards and Costs at Joint Bases and Better Inform Congress of Facility Sustainment Funding Uses
Published: 2009-03-30T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: The 2005 Defense Base Closure and Realignment Commission recommended that the Department of Defense (DOD) establish 12 joint bases by consolidating the management and support of 26 separate installations, potentially saving $2.3 billion over 20 years. In response to a direction from the House Armed Services Committee report accompanying the National Defense Authorization Act for Fiscal Year 2009, GAO evaluated DOD's (1) efforts and expected costs to deliver installation support at joint bases and (2) funding for facility sustainment, which includes the maintenance and repair activities necessary to keep facilities in good working order, at all installations. GAO compared new support standards with the current support levels, visited nine installations that will become four joint bases, and compared facility sustainment funding levels with requirements and goals.
section_title: What GAO Found
paragraphs: DOD has made a comprehensive effort to ensure consistent delivery of installation support at the planned joint bases, but the cost of installation support is expected to increase rather than decrease as forecasted by the 2005 Defense Base Closure and Realignment Commission. In January 2008, DOD began issuing joint base implementation guidance that for the first time established a set of common definitions and standards for installation support. The guidance defined 47 installation support areas (e.g., airfield operations, grounds maintenance, custodial services, and child and youth programs) and provided 267 standards to define the expected level of service in each area. DOD officials stated that the standards represented the service levels needed to meet mission and personnel requirements in view of DOD policies and guidance, commercial standards, other federal agency guidance, or in some cases, military judgment. However, contrary to the expectations of the commission, for two primary reasons installation support costs at the joint bases are expected to increase above the cost of support provided by the separate installations before consolidation. First, DOD has required the joint bases to deliver installation support in accordance with the new standards even though the military services have not previously funded installation support in the amounts needed to meet each of the standards. GAO's comparison of 40 selected standards to the service levels currently provided at the nine installations it visited showed that on average service levels would have to increase to meet the standards in about 27 percent of the areas compared. Second, in some instances the services' approach to implementing joint basing will result in additional administrative costs and the loss of some existing installation support efficiencies. Although DOD officials stated that the increased support costs at the joint bases might be at least partially offset over time as experience is gained and new efficiencies are identified and adopted, it is unclear whether joint basing will result in actual savings. The military services have not budgeted and spent sufficient funds to meet their facility sustainment requirements and goals and prevent facility deterioration at the installation level. Citing other budget priorities as the reason, the military services did not budget funds to meet about $2.3 billion (9 percent) of their total facility sustainment requirements during fiscal years 2005 through 2008 and, according to DOD, needed sustainment work that is not performed may eventually result in damaged facilities, shortened facility service lives, and increased future costs for facility restoration. The services have further exacerbated the sustainment funding issue by using some budgeted sustainment funds for other purposes. During fiscal years 2006 through 2008, the military services used about $2.6 billion (14 percent) of the funds budgeted for sustainment for other purposes, primarily to pay for unfunded facility restoration and modernization projects. Although service officials stated that these projects were needed, the consequence was that sustainment requirements were not met. During visits to nine installations, GAO found backlogs of deferred sustainment needs and some facilities that were not in good condition because funds were not available to pay for all needed sustainment work.

section_title: Letter
paragraphs: Estimating that $2.3 billion could be saved over a 20-year period, the 2005  Defense Base Closure and Realignment (BRAC) Commission  recommended that the Department of Defense (DOD) establish 12 joint  bases by consolidating the management and support of 26 separate Army,  Navy, Air Force, and Marine Corps installations. The commission noted  that, because all installations perform common functions in support of  installation personnel and facilities and because these installations shared  a common boundary or were in close proximity, the joint bases could  reduce duplication of efforts and achieve greater efficiencies through  economies of scale, which could result in significant long-term savings in  installation support costs. For each of the joint bases, the commission  designated which military service would become the lead component with  responsibility for delivering installation support services for the  consolidated base. This arrangement—with one military service assuming  responsibility for supporting another military service’s installation— created concerns about the delivery of installation support at the joint  bases because DOD had not established common definitions and  standards for installation support functions and services. Instead, each  military service had its own long-standing policies and practices on how  each installation support function was defined and the level of service  typically provided in each area. In view of the differences, it was not clear  that the joint bases, scheduled to be fully implemented by October 2010,  would deliver installation support consistently and at a level considered  acceptable by each of the installations combining into the joint bases.
One installation support area that has been of particular concern, not only  at the planned joint bases but at all military installations, is facility  sustainment, which includes the maintenance and repair necessary to  keep facilities in good working order. DOD is one of the world’s largest  organizations in terms of physical plant, managing and operating about  545,000 buildings and structures with a total replacement value of about  $706 billion. DOD determined that the most cost-effective approach to  managing its facilities is to fully fund sustainment requirements because  this method provides the most performance over the longest period for the  least investment. To implement this approach, DOD developed a facilities  sustainment model that determines these requirements and established a  goal that the military services budget for sustainment in accordance with  the model. However, in an April 2008 report, we found that although  DOD’s model provided reasonable and consistent requirements estimates,  the military services were not budgeting for sustainment in the amounts  estimated by the model. As a result, some installation facilities were not  being sustained at a level to keep them in good working order and will  likely experience reduced service lives, which in turn will lead to more  costly recapitalization requirements in the future.
The House Armed Services Committee cited our 2008 report in its report  accompanying the Duncan Hunter National Defense Authorization Act for  Fiscal Year 2009 and expressed concerns about the delivery of installation  support across the joint bases and the adequacy of facility sustainment  funding at all installations. The committee directed that we perform an  assessment of these areas. In response, this report evaluates DOD’s   (1) efforts and expected costs to deliver installation support at the planned  joint bases and (2) funding for facility sustainment at all installations.
To address these areas, we (1) reviewed DOD implementation plans,  guidance, and cost estimates associated with the delivery of installation  support at the planned joint bases and compared the levels of service in  selected support areas currently provided by the separate installations  with the levels of service to be provided by the joint bases and   (2) examined and compared DOD’s requirements and goals for facility  sustainment funding with the amounts actually budgeted and spent on  sustainment. Also, to gain local-level insight into the planned delivery and  expected costs of installation support at the joint bases as well as  sustainment funding levels and facility conditions, we visited 3 Army, 3  Navy, and 3 Air Force installations that are consolidating into 4 of the 12  planned joint bases. We selected bases for visits that had the highest  potential reduction in jobs according to DOD’s 2005 BRAC report. We  conducted this performance audit from May 2008 through February 2009,  in accordance with generally accepted government auditing standards.  Those standards require that we plan and perform the audit to obtain  sufficient, appropriate evidence to provide a reasonable basis for our  findings and conclusions based on our audit objectives. We believe that  the evidence obtained provides a reasonable basis for our findings and  conclusions based on our audit objectives. See appendix I for more  information on our scope and methodology.
subsections: section_title: Background
paragraphs: The 2005 BRAC Commission final report noted that all installations  employ military, civilian, and contractor personnel to perform common  functions in support of installation facilities and personnel and that all  installations execute these functions using similar or near similar  processes. The report also noted that, in areas where the military services  operated separate installations that share a common boundary or were in  close proximity, there was significant opportunity to reduce duplication  and costs by consolidating the installations. Specifically, the report stated  that by consolidating nearby installations, savings in personnel and  facilities costs could be realized by eliminating duplication of efforts,  paring unnecessary management personnel, achieving greater efficiencies  through economies of scale, consolidating and optimizing existing and  future service contract requirements, establishing a single space  management authority that could achieve greater utilization of facilities,  and reducing the number of base support vehicles and equipment  consistent with the size of the combined facilities.
The report recommended that DOD establish 12 joint bases from 26  existing installations and estimated that the net present value of the costs  and savings from this effort over 20 years would be about $2.3 billion. For  each of the joint bases, the report designated which military service would  become the lead component with responsibility for delivering installation  support services for the consolidated base. To implement the  recommendation, DOD established a schedule that divided the 12 planned  joint bases into two implementation phases. Five joint bases involving   11 installations were placed into phase I with a September 30, 2008,  milestone for signing a joint base memorandum of agreement, which  would provide a detailed implementation plan including the personnel and  financial arrangements for the combined base, and an October 1, 2009,  milestone for full implementation, which included the transfer of  personnel and funds to the joint base. The remaining 7 joint bases  involving 15 installations were placed into phase II with a September 30,  2009, milestone for signing the joint base memorandum of agreement and  an October 1, 2010, milestone for full implementation. Table 1 provides  details on the planned joint bases.
DOD officials stated that, although none of the phase I joint bases met the  September 30, 2008, milestone for signing their memorandums of  agreement, joint bases Myer-Henderson Hall, Andrews-Naval Air Facility  Washington, and Little Creek-Fort Story had signed agreements by January  2009. The officials stated that Joint Base McGuire-Dix-Lakehurst and Joint  Region Marianas are expected to sign agreements later in 2009 and all  phase I joint bases are still expected to meet the October 1, 2009,  milestone for full implementation.
subsections: section_title: Installation Responsibilities and Support Funding
paragraphs: The Office of the Deputy Under Secretary of Defense for Installations and  Environment has overall responsibility for DOD’s installations and  facilities and by delegation has authority to approve and issue guidance for  joint basing. DOD’s facilities portfolio includes about 545,000 buildings  and structures worldwide with a total replacement value of about   $706 billion. During fiscal year 2009, DOD plans to spend about $62 billion  to support its facilities and installations. DOD refers to this funding as  installation support, which includes broad categories of services,  programs, and support activities, as shown in figure 1.
The largest categories of installation support are installation services and  facilities. Installation services, funded primarily with operation and  maintenance appropriations, includes the personnel, support equipment,  contracts, and associated costs to plan, manage, and deliver installation  services and functions, such as installation airfield and port operations;  security; transportation; supply; communications; information  management; personnel management; food services; administrative, legal,  and financial services; unaccompanied personnel housing management;  family and quality of life programs; and environmental compliance.
The facilities category is composed of five subcategories—facilities  operation services, sustainment, recapitalization, disposal, and new  footprint, which includes facility construction related to new or expanded  missions.
Facilities operation services, funded primarily with operation and  maintenance appropriations, includes 10 facility-related services—fire  and emergency services, utilities, pavement clearance, refuse  collection and disposal, real property leases, grounds maintenance,  pest control, custodial services, real property management and  engineering services, and engineering readiness. DOD previously  referred to facility operations as real property services and, together  with installation services, family housing, and environment, were  referred to as base operations support. In general, the military  services’ budgets continue to refer to funding for installation services  and facility operation services as base operations support funding.
Sustainment, funded primarily with operation and maintenance  appropriations, includes the maintenance and repair activities  necessary to prevent deterioration, maintain safety, and keep facilities  in good working order over their service lives. Sustainment includes  routine and preventive maintenance tasks and emergency response  and other service calls for minor repairs. Sustainment also includes  major repairs or replacement of facility components that are expected  to occur periodically throughout a facility’s life cycle, such as regular  roof replacement; refinishing wall surfaces; repairing and replacing  electrical, heating, and cooling systems; and replacing tile and carpets.  Since fiscal year 2003, DOD has used a model—the facilities  sustainment model—to estimate annual facility sustainment funding  requirements in each military service. Although the Office of the  Deputy Under Secretary of Defense for Installations and Environment  has overall responsibility for DOD’s installations and facilities, the  individual military services are responsible for budgeting and  allocating facility sustainment funds to installations. Appendix II  summarizes each service’s sustainment funding allocation process.
Recapitalization, funded primarily with operation and maintenance  and military construction appropriations, provides for improving  facilities through restoration and modernization. Restoration includes  repair and replacement work needed to restore facilities degraded  from several causes, such as natural disaster, fire, accident, excessive  age, or inadequate sustainment. Modernization includes both  renovation and replacement of existing facilities to implement new or  higher standards, accommodate new functions, or replace building  components that typically last more than 50 years and are near the end  of their economic lives.
section_title: Prior GAO Reports
paragraphs: Since 1997, we have identified management of DOD support infrastructure  as a high-risk area because infrastructure costs have affected the  department’s ability to devote funds to other more critical programs and  needs. In a January 2009 update to our high-risk series, we noted that  although DOD has made progress in managing its support infrastructure in  recent years, a number of challenges remain in managing its portfolio of  facilities and reducing unneeded infrastructure while providing facilities  needed to support several simultaneous force structure initiatives.  Further, we noted that because of these issues, DOD’s management of  support infrastructure remains a high-risk area.
We have issued several reports on DOD’s implementation of the  recommendations from the 2005 BRAC round. The reports generally found  that, compared with the original cost and savings estimates,  implementation costs were expected to increase and savings were  expected to decrease. For example, in a December 2007 report, we found  that DOD planned to spend more, save less, and take longer to recoup up- front costs than expected to implement the 2005 BRAC recommendations  due to increased construction cost estimates, the effects of inflation,  environmental clean-up costs not accounted for in the original estimates,  and other miscellaneous expenses including operation and maintenance  expenses. We also found that DOD’s estimated costs and savings to  implement the recommendations were likely to change further due to  uncertainties surrounding certain implementation details, potential  increases in military construction costs, and likely increases in the cost of  environmental cleanup for some BRAC properties. In a March 2008 report  on two BRAC recommendations that were intended to improve DOD’s  logistics systems, we found that DOD would spend more, save less, and  take longer than expected to recoup up-front costs to implement those  recommendations due to the use of inaccurate or outdated data,  misinterpretation of terms, and changes in operational requirements. On  January 30, 2009, we reported that while DOD has made progress in  implementing the BRAC 2005 round, it faces challenges in its ability to  meet the September 15, 2011, statutory completion deadline. Further,  DOD’s fiscal year 2009 BRAC budget submission shows that DOD plans to  spend more to implement recommendations and save slightly less  compared to the 2008 BRAC budget and that the potential remains for  BRAC cost estimates to continue to increase. DOD concurred with several  recommendations from these reports on ways that DOD could improve its  development of BRAC savings estimates.
We have also issued several reports over the past few years highlighting  the long-term challenges DOD faces in managing its portfolio of  installations and halting the degradation of facilities. For example, in  February 2003, we found that funds designated for facilities sustainment  were held back at the service headquarters, major command, and  installation levels to cover more pressing needs or emerging requirements  and that, as a result, facility deterioration continued. DOD concurred  with our recommendation that the military services reassess the funding  priorities attached to sustaining and improving their facilities. In a June  2005 report, we found that DOD did not have a common framework for  identifying installation support functions and funding requirements to  ensure adequate delivery of services, particularly in a joint environment.  We also found that, because of a lack of a common terminology across the  military services in defining installation support functions and the lack of a  mature analytic process for developing credible and consistent  requirements, the services moved hundreds of millions of operation and  maintenance dollars designated for facilities sustainment and other  purposes to pay for installation support services. While such funding  movements are permissible, we found that they were disruptive to the  orderly provision of installation support and contributed to the overall  degradation of facilities. In an April 2008 report, we found that the military  services had not met all of DOD’s goals for funding facility sustainment  and recapitalization at levels to prevent deterioration and, because DOD  continued to lack common definitions and performance standards for  installation support functions, each military service had developed  methods to determine its installation services requirements and funding  needs subject to its own definition of the types and levels of services it  deemed necessary. We also found that DOD’s facilities sustainment  model provided a consistent and reasonable framework for preparing  estimates of DOD’s annual facility sustainment funding requirements, even  though the reliability of the model’s estimates could be improved through  increased accuracy of the model’s inputs. The 2005 and 2008 reports made  recommendations related to resolving the inconsistencies among the  military services’ definitions of installation support functions and, with the  joint basing guidance issued during 2008, DOD completed the  development of common installation support definitions. DOD also  concurred with recommendations from the 2008 report that it will take  several actions to increase the facilities sustainment model’s reliability.
section_title: DOD Has Made a Comprehensive Effort to Ensure Consistent Delivery of Installation Support at Joint Bases, but Support Costs Are Expected to Increase
paragraphs: DOD has made a comprehensive effort to ensure that the 12 planned joint  bases deliver consistent installation support, but support costs are  expected to increase, at least in the short term, rather than decrease as  expected by the 2005 BRAC Commission. DOD’s efforts to ensure  consistent support have included the issuance of detailed guidance, which  for the first time provided common installation support definitions and  standards, and the establishment of mechanisms to help ensure that the  joint bases comply with guidance requiring that the bases deliver  installation support in accordance with the new definitions and standards.  However, instead of decreasing, support costs at the joint bases are  expected to increase primarily because past funding for installation  support has been insufficient to provide support at the levels called for by  either existing or the new common service standards, and in some  instances the military services’ approach to implementing joint basing will  result in additional administrative costs and the loss of some existing  installation support efficiencies. In the long term, DOD officials stated that  the increased installation support costs might be at least partially offset as  best practices and new operational efficiencies are identified and adopted  over time. However, on the basis of the higher installation support cost  estimates from the initial joint bases and as long as installation support is  delivered in accordance with the new support standards, it is unclear  whether joint basing will result in any actual savings.
subsections: section_title: DOD Established Common Definitions and Standards to Help Ensure Consistent Delivery of Installation Support
paragraphs: Before January 2008, DOD had not established common definitions and  standards for installation support functions and services. Instead, each  military service had its own long-standing policies and practices on how  tasks in each installation support function were defined, performed, and  funded. The differences in the military services’ policies and practices for  managing their installations had resulted in differences in the emphasis  placed on the various support areas and the level of service typically  provided in each area. In view of such differences, it was not clear that the  joint bases, scheduled to be fully implemented by October 2010, would  deliver installation support services consistently and at levels considered  acceptable by each of the installations combining into the joint bases.
To address this issue, OSD began issuing a series of joint basing  implementation guidance in January 2008 that for the first time established  a set of common definitions and standards for the installation support  functions and services to be provided by each joint base. After working  with the military services to develop and obtain concurrence with the new  definitions and standards, OSD issued guidance that defined 47 installation  support functions—such as installation security services, custodial  services, and child care programs—and provided 267 standards to help  define the level of service that each joint base is to provide in each area.  The guidance also required that only the joint bases deliver installation  support in accordance with the new definitions and standards. Thus, the  vast majority of military installations that are not involved with joint  basing are not required to deliver installation support in accordance with  the new definitions and standards at this time.
According to DOD, the new standards represented the service levels  needed to fully meet installation mission, facility, and personnel needs in  view of existing OSD and military service policies, guidance, and practices;  commercial industry standards; guidance from other federal agencies; or  military judgment. The standards include the following.
About 62 percent of the standards, in areas such as fire protection and  emergency services and airfield operations, were based on existing  OSD and military service policies and requirements.
About 13 percent of the standards, in areas such as custodial services  and grounds maintenance and landscaping, were based on commercial  industry standards or guidance from other federal agencies.
About 25 percent of the standards, in areas such as installation  chaplain services and legal support, were based on the judgment of  military subject matter experts. According to DOD, the standards  determined by military subject matter experts were in areas that were  not covered by DOD policy or other requirements and did not have  comparable commercial standards. To determine standards for these  areas, the subject matter experts generally reviewed the practices of  each military department and reached agreement on the service levels  needed that in their judgment would best meet installation mission and  personnel requirements. Judgment was used to decide the standard  level of service in view of mission, facility, personnel, and quality of  life factors. Also, because costs generally increase as the level of  service increases, some of these decisions also involved the  consideration of trade-offs between alternative levels of service and  affordability.
Officials at OSD and each of the military services stated that the new  common standards called for service levels that were very close to each  military service’s existing installation support standards or practices.  However, the officials also noted that because installation support had not  been fully funded in the past, military installations normally did not  provide support at the levels called for by all of their existing standards.
The following examples illustrate a few of the installation support function  definitions and standards that DOD established for joint basing, and  appendix III provides a list of the 47 defined installation support functions  and the number of standards developed for each area.
Information technology services management was defined to include  the personnel, contracts, and equipment necessary to plan, manage,  coordinate, and execute the delivery of services including fixed and  wireless voice, data, and video services. Twenty-six standards were  established to define the expected level of service for this support  function. For example, each joint base is to (1) maintain 99.99 percent  telephone dial tone availability, (2) provide wireless local mobile radio  service for 100 percent of the base’s populated area and 85 percent of  the total base area, (3) respond within 90 minutes to critical circuit  outages 99 percent of the time, and (4) resolve 95 percent of  nonmission critical trouble calls within 4 days.
Installation law enforcement operations was defined to include the  personnel, contracts, and support equipment necessary to enforce  federal, state, and military law; investigate crimes; apprehend and  detain suspects; manage traffic; and detect and prevent crime. Five  standards were established to define the expected level of service for  this support function. For example, within 15 minutes of a call the joint  base is to provide the first law enforcement patrol response and within  30 days the joint base is to complete 90 percent of investigations.
Grounds maintenance and landscaping was defined to include all  associated landscaping and plant growth management activities for  three defined land categories—improved, semi-improved, and  unimproved. Three standards were established to define the expected  level of service for this support function. For example, for improved  land, which includes the grounds surrounding occupied buildings and  permanent structures, the joint base is to maintain the grass height at   2 to 4 inches and accomplish necessary trimming, edging, pruning, and  landscaping to maintain healthy vegetation and a professional  appearance.
Facilities sustainment, which DOD had previously defined, includes  the maintenance and repair activities necessary to prevent  deterioration, maintain safety, and keep facilities in good working  order over their service lives. Seven standards were established to  define the expected level of service for this support function. For  example, the joint base is to (1) perform 90 percent of the preventive  maintenance called for by manufacturers’ recommendations,   (2) replace 90 percent of facility components in accordance with each  component’s useful service life, (3) resolve 100 percent of emergency  service calls within 24 hours, and (4) resolve 90 percent of routine  service calls within 30 calendar days.
Officials at the nine installations we visited stated that in general the  definitions and standards adequately described the installation support  functions and provided reasonable metrics so that the expected level of  service in most areas was clearly understood. Installation officials stated  that in some cases the standards were not as detailed or as clear as  possible. Nevertheless, the officials stated that they recognized that the  standards provided the first common expectations for installation support  and believed that missing details and needed clarifications would be  provided as the standards are implemented at the joint bases.
section_title: DOD Has Taken Additional Steps to Help Ensure That Joint Bases Deliver Consistent Installation Support
paragraphs: DOD has taken additional steps to help ensure that the joint bases will  deliver installation support in accordance with the new installation  support definitions and standards. First, OSD issued guidance that  requires the installations forming each joint base to complete a  memorandum of agreement that defines the installation support  relationship between the components forming the joint base for fully  implementing the BRAC 2005 joint base decisions. The guidance also  provides a template memorandum of agreement that, among other things,  commits the lead component to deliver installation support in accordance  with the support definitions and standards. Although installations can  request that OSD approve deviations from delivering support in  accordance with each standard during development of the memorandums,  OSD officials stated that no deviations were requested from the  installations consolidating into the phase I joint bases. Second, to facilitate  consistency in developing the memorandums, OSD officials stated that  they held workshops and conducted visits to the installations involved in  joint basing. Third, to ensure top management support for the terms  included in each memorandum, OSD’s guidance requires that the Vice  Chief of Staff of the Army, the Vice Chief of Naval Operations, the Vice  Chief of Staff of the Air Force, and the Assistant Commandant of the  Marine Corps approve and sign the memorandum at each joint base  involving their military service. Because the memorandums include the  expected joint base personnel and funding requirements, the signatures of  the Vice Chiefs are considered to be a commitment that each involved  military service will provide the necessary personnel and funding to fully  support the joint base and the delivery of installation support services in  accordance with the definitions and standards. Fourth, OSD has  established a framework, termed the cost and performance visibility  framework, which is designed to collect and report cost and performance  data pertaining to installation support and also assess compliance with the  terms of the joint base memorandums of agreement. According to DOD  officials, this framework, as well as installation-level monitoring of joint  base implementation, will help ensure that any issues concerning the  delivery of support are quickly identified so that corrective steps can be  taken. Officials at the nine installations we visited stated that, as long as  necessary funding is provided, the joint bases will deliver consistent  installation support.
section_title: Installation Support Costs at the Joint Bases Are Expected to Increase
paragraphs: Contrary to the expectations from the 2005 BRAC Commission, OSD and  service headquarters officials stated that installation support costs at the  joint bases are expected to increase, at least in the short term, above the  cost of installation support provided by the separate installations before  consolidation. Included in each joint base’s memorandum of agreement  are estimates of the current cost of installation support at the installations  consolidating into joint bases and the expected cost of installation support  after implementation of a joint base. As shown in table 2, at the three joint  bases that had completed their memorandums as of January 2009, annual  installation support costs are expected to increase by about $24 million   (7 percent) above current support costs.
Officials at each of the nine installations we visited noted concerns about  the cost of installation support under joint basing. For example, during our  visit to McGuire Air Force Base, Fort Dix, and Naval Air Engineering  Station Lakehurst, installation officials stated that installation support  costs would increase after implementation of the joint base primarily  because support levels in some areas would be increased to meet the new  standards. An official estimate of the expected increase in costs was not  available in January 2009 because these installations had not completed  their memorandum of agreement. However, during our visit, McGuire Air  Force Base officials estimated that an additional 194 personnel, along with  the associated costs, would be needed for the joint base to provide  installation support in accordance with the support standards. Similarly,  during our visit to Charleston Air Force Base and Naval Weapons Station  Charleston, a phase II joint base, installation officials also stated that they  expected support costs to increase under joint basing. Preliminary  estimates by Charleston Air Force Base officials showed that over 200  additional personnel might be needed for the joint base to provide  installation support in accordance with the support standards.
Even before the initial three phase I joint bases had prepared their cost  estimates showing increased support costs, the military services had  already significantly reduced the estimate of the potential 20-year savings  from joint basing as compared to the savings estimate made by the 2005  BRAC Commission. Specifically, in documents prepared to support the  fiscal year 2009 budget, the military services estimated that the potential  20-year savings from joint basing was about $273 million in constant fiscal  year 2005 dollars. This amount reflects a reduction of about 88 percent  from the $2.3 billion savings in constant fiscal year 2005 dollars estimated  by the commission. In view of the increased cost estimates from the initial  phase I joint bases, some DOD officials stated that the military services’  future estimates of the potential long-term savings would most likely  continue to decline.
section_title: Military Services Have Not Fully Funded Installation Support in the Past
paragraphs: A key reason that installation support costs at the joint bases are expected  to increase is that OSD has required that the joint bases deliver installation  support in accordance with the 267 new support standards, even though  the military services have not previously funded installation support in the  amounts needed to meet each of the standards. Thus, additional costs will  be incurred to meet the standards. According to OSD officials, ideally all  military installations should provide support services in accordance with  the newly established definitions and standards. However, primarily  because of the significant increase in installation support funding that  would be needed for all installations to meet the service standards, OSD  has required that only the joint bases meet the standards at this time.
For many years, the adequacy of installation support funding has been a  concern for the military services. Army, Navy, and Air Force officials  stated that installation services funding for fiscal years 2005 through 2008  was less than the amounts needed to provide support at the levels desired.  For example, according to Army officials, installation and facility  operations support services—collectively classified as base operations  support in the Army’s budget—were funded at about 80 percent,   82 percent, 87 percent, and 85 percent of requirements in fiscal years 2005,  2006, 2007, and 2008, respectively. Army officials stated that, because of  these funding levels, some installation services were reduced and provided  at lower than optimum levels at some installations, which reduced the  support provided to military personnel.
To obtain some insight into how many areas might require increased  service levels at the installations consolidating into the joint bases, we  performed a comparison of current service levels to the joint base  standard service levels at the installations we visited. Specifically, we  judgmentally selected 40 of the 267 joint base service-level standards and,  at each installation we visited, compared the level of service that the  installation was currently providing with the new standard. As shown in  table 3, in about 27 percent of areas we compared, the joint base will have  to increase the level of service provided to meet the standards.
The following examples provide details on some of the support standards  and current service levels that we compared at the installations visited.
One standard for an installation’s child care program calls for 100  percent of children to be placed in the program within 3 months of a  request. Officials at five of the nine installations we visited stated that  their installation was not currently meeting this standard and that  additional funding for facility construction and personnel will be  needed to meet the standard. According to OSD officials, this standard  was determined by military subject matter experts and was based  primarily on an existing Navy standard.
One standard for an installation’s youth program services calls for   35 percent of eligible youth to participate in service youth programs.  Officials at six of the nine installations we visited stated that their  installation was not currently meeting this standard and that additional  funding to increase facility capacity for youth programs will be needed  to meet the standard. According to OSD officials, this standard  originated in a DOD social compact, which was previously adopted by  the military service components.
One standard for an installation’s basic custodial services calls for the  restrooms to be cleaned three times per week, the floors to be swept  and mopped once per week, the carpets to be vacuumed once per  week, the floors to be buffed monthly, and the windows to be cleaned  annually. Officials at seven of the nine installations we visited stated  that their installation was not currently meeting this standard and that  additional funding for personnel will be needed to meet the standard.  According to OSD officials, this standard was based primarily on an  existing Air Force standard.
One standard for an installation’s facility sustainment activities calls  for 90 percent of facility components to be replaced in accordance  with the component’s useful service life. Officials at seven of the nine  installations we visited stated that their installation was not currently  meeting this standard and that additional funding will be needed to  meet the standard. According to OSD officials, this standard was based  on recently issued DOD budgeting guidance.
section_title: Military Services’ Approach to Joint Base Implementation Will Result in Some Additional Installation Support Costs
paragraphs: Another key reason that joint basing is expected to increase installation  support costs is that the military services’ approach to joint base  implementation will result in some additional administrative costs and the  loss of some existing installation support efficiencies. For example,  additional costs for installation administration are expected at the six joint  bases where the Air Force will be the lead component. DOD officials noted  that the typical smaller Air Force installation has one base commander  who is responsible for both installation support and the operational  mission of the installation. This differs from larger Air Force bases and  typical Army and Navy installations, which have separate commanders  responsible for installation support and for operational missions. Because  of the increased administrative workload associated with providing  installation support at a joint base, Air Force officials decided that it  would be preferable to have a commander solely responsible for  installation support at each joint base. To accomplish this, the Air Force  intends to establish a new organization unit, consisting of a commander  and supporting staff, which will be responsible for managing installation  support at six joint bases where the Air Force will be the lead component.  Although the Air Force did not have estimates of the added costs for the  new units, officials at McGuire Air Force Base estimated that 19 additional  administrative personnel will be needed to establish the new unit that will  manage installation support at Joint Base McGuire-Dix-Lakehurst, which  will result in increased costs.
As another example, officials at some of the Army and Navy installations  we visited stated that in a few instances existing installation support  efficiencies will be lost at joint bases where the Air Force will be the lead  component. The officials stated that currently their regional commands  provided some support services to the installation, such as certain  personnel- and travel-related services, which would become the  responsibility of the Air Force under joint basing where the Air Force is  the lead component. However, the officials stated that the efficiencies  from these existing arrangements will be lost because the joint base will  begin to provide these services and at the same time no reduction in  personnel was expected at the Army and Navy regions since the regions  will continue to provide services for the installations that are not involved  with joint basing.
Officials at McGuire Air Force Base and Fort Dix cited another example of  increased support costs resulting from the way that Joint Base McGuire- Dix-Lakehurst is being implemented. As the lead component, McGuire Air  Force Base will become responsible for installation support at this joint  base and, in the area of delivering contract support, the Air Force has  decided that McGuire’s existing contracting office will be expanded in  order to provide contracting services for the joint base. However,  according to McGuire Air Force Base and Fort Dix officials, this approach  will result in higher support costs compared to an alternative approach.  Specifically, the officials stated that an existing contracting office at Fort  Dix, which currently provides contracting services to Fort Dix as well as  to other Army reserve units across the United States, could provide  contracting services for the joint base with fewer personnel and at less  cost than McGuire Air Force Base’s contracting office. Although  installation officials stated that this alternative was feasible and less  costly, Air Force decided not to use the contracting office at Fort Dix  primarily because the office is outside the Air Force’s direct chain of  command and the Air Force will ultimately be responsible for all joint base  contracting services.
section_title: Officials Believe Increased Installation Support Costs Could Be Offset in the Long Term
paragraphs: In the long term, OSD officials stated that the increased cost of installation  support at the joint bases might be at least partially offset as experience is  gained and best practices and new operational efficiencies are identified  and adopted over time. However, as long as support is provided at levels  that meet the new support standards, OSD officials stated that they did not  expect that installation support costs at the joint bases would fall below  the current cost of installation support provided by the separate  installations before consolidation. Thus, even in the long term, the officials  did not expect that joint basing would result in actual savings from  installation support spending levels prior to joint basing.
section_title: Facility Sustainment Funding Has Not Been Sufficient to Meet Requirements and Prevent Facility Deterioration
paragraphs: The military services have not budgeted and spent sufficient funds to meet  their facility sustainment requirements and goals and prevent facility  deterioration at installations throughout DOD. According to DOD, full  funding of sustainment requirements is the most cost-effective approach  to managing facilities because it provides the most performance over the  longest period for the least investment. For this reason, DOD established a  goal that the military services budget for sustainment in accordance with  requirements as determined by DOD’s facilities sustainment model.  However, citing other budget priorities as the reason, the military services  have not budgeted funds in the amounts needed to fully fund their  sustainment requirements. In addition, the services have often spent even  less on sustainment than they budgeted because they used some of the  budgeted sustainment funds for other purposes, primarily to pay for  unfunded facility restoration and modernization projects. As a result, the  services have significant backlogs of needed facility sustainment work and  some installation facilities have not been sustained at a level to keep them  in good working order. According to DOD, when facilities are not fully  sustained, the facilities will likely experience reduced service lives and  more costly recapitalization requirements in the future.
subsections: section_title: Full Funding of Sustainment Requirements Is Cost Effective
paragraphs: According to DOD, full funding of sustainment requirements is the most  cost effective approach to managing facilities because it provides the most  performance over the longest period for the least investment. However, as  other important priorities, such as force modernization, have competed for  funding, DOD has been challenged to provide adequate resources for  sustaining and recapitalizing its facilities. In April 2007 testimony, DOD  noted that full funding of facilities sustainment had been and continued to  be the foundation of the department’s long-term facilities strategy and  goals in order to optimize DOD’s facility investment and ensure facility  readiness. When full sustainment funding is not provided, service officials  noted that facility deterioration accelerates, facility service lives shorten,  mission capabilities and quality of life decrease, and expected future costs  increase.
In view of these positions and recognizing that funding of sustainment  requirements had been a challenge because of competing budget  priorities, DOD’s 2004 installations strategic plan established a goal for the  military services to fund sustainment at 95 percent of the requirement  determined by DOD’s facilities sustainment model beginning in fiscal year  2005, and at 100 percent of the requirement beginning in fiscal year 2008.  In April 2008, we reported on the reliability of the facilities sustainment  model. The report noted that even though the reliability of the model’s  estimates could be improved, the model provided a consistent and  reasonable framework for estimating sustainment requirements. Thus, use  of the model for setting annual funding goals at the military service level  appears reasonable.
section_title: Military Services Have Not Budgeted for Sustainment at Levels to Meet Requirements
paragraphs: Citing other budget priorities as the reason, the military services have not  budgeted funds in the amounts needed to meet their sustainment  requirements. Although DOD established a sustainment budgeting goal in  fiscal year 2005, until fiscal year 2008 the goal called for the services to  budget 95 percent of their requirements, rather than 100 percent of their  requirements. Thus, even though the services met the goal in some years  during fiscal years 2005 through 2007, they still did not budget sufficient  funds to meet all requirements as determined by the facilities sustainment  model. Further, none of the services met the 100 percent goal for fiscal  year 2008. Specifically, in fiscal year 2008, the Army budgeted 89 percent,  the Navy budgeted 83 percent, the Air Force budgeted 90 percent, and the  Marine Corps budgeted 89 percent of their respective facility sustainment  requirements. In total during fiscal years 2005 through 2008, the military  services did not budget funds to meet about $2.3 billion (9 percent) of  their total facility sustainment requirements. Table 4 provides details by  service on the amount of the facilities sustainment requirement that was  not budgeted during fiscal years 2005 through 2008.
While maintaining the goal that the services budget 100 percent of their  requirements as determined by the facilities sustainment model, OSD  officials stated that they issued guidance in 2007 that the services budget  at least 90 percent of their facilities sustainment requirements in fiscal  years 2009 through 2013. The budgeting floor was set in order to provide a  minimum funding level for sustainment across DOD and more consistency  across the services in sustainment budgeting. According to OSD officials,  affordability played a major role in choosing 90 percent as the floor, and  the risk of not budgeting at 100 percent was considered acceptable in light  of other DOD priorities.
section_title: Military Services Have Used Some Budgeted Sustainment Funds for Other Purposes
paragraphs: The military services have further exacerbated the sustainment funding  issue by using some of the budgeted sustainment funds for other purposes.  OSD officials explained that even though the goal is for the services to  budget 100 percent of their sustainment requirements and beginning in  fiscal year 2009 the services are required to budget at least 90 percent of  their sustainment requirements, the services have the flexibility to use  budgeted sustainment funds for other purposes, if they determine that  such spending is necessary. OSD officials noted that some spending  flexibility is needed and is inherent in all operations and maintenance  funded programs, including facilities sustainment.
According to information provided by the Army, the Navy, the Air Force,  and the Marine Corps, the services used about $2.6 billion (14 percent) of  the funds budgeted for sustainment for other purposes during fiscal years  2006 through 2008. Specifically, of the funds budgeted for sustainment  during fiscal years 2006 through 2008, the Army used about $1.5 billion   (21 percent) for other purposes, the Navy used about $900 million   (25 percent) for other purposes, the Air Force used about $200 million   (4 percent) for other purposes, and the Marine Corps did not use any  budgeted sustainment funds for other purposes. Service officials noted  that nearly all of the sustainment funds used for other purposes was used  to pay for unfunded facility restoration and modernization projects that  they determined to be more urgent than funding sustainment work.  Restoration and modernization work typically involves larger, more  extensive projects that restore facilities degraded from several causes,  such as natural disaster or inadequate sustainment, or renovate or replace  facilities to implement new or higher standards, accommodate new  functions, or replace building components that typically last more than   50 years and are near the end of their economic lives. Thus, the funds were  used for the benefit of installation facilities. However, even though the  officials stated that these projects were needed and other funds to pay for  the projects were not available, the consequence was that additional  sustainment requirements went unmet. According to DOD, needed  sustainment work that is not performed may eventually result in damaged  facilities, shortened facility service lives, and increased future costs for  facility restoration.
section_title: Underfunding of Sustainment Requirements Has Resulted in Sustainment Backlogs and Some Deteriorated Installation Facilities
paragraphs: Because the military services have not budgeted to meet all sustainment  requirements and have used some of the funds budgeted for sustainment  for other purposes, the services have backlogs of needed sustainment  work and some facilities have fallen into disrepair. For example, the Navy  and the Air Force reported that their sustainment backlog at the end of  fiscal year 2008 was about $222 million and $362 million, respectively. The  Army did not report the amount of its sustainment backlog. Instead, the  Army stated that deferred sustainment work became a restoration  requirement, and at the end of fiscal year 2008, the Army reported that its  restoration and modernization backlog was $19.6 billion. For comparison,  the Navy and the Air Force reported that their restoration and  modernization backlog was $28.7 billion and $10.2 billion, respectively, at  the end of fiscal year 2008. The Marine Corps also did not report a backlog  of sustainment work but reported that its restoration and modernization  backlog was about $1.1 billion at the end of fiscal year 2008.
Although many facilities were in good condition, service officials stated  that underfunding of sustainment requirements over many years had  resulted in some deteriorated facilities, which according to DOD will likely  result in reduced service lives and more costly recapitalization  requirements in the future. Army officials noted that when sustainment  funding is inadequate, planned projects are delayed, which sometimes  causes further deterioration, such as damage to interior walls and floors  from leaking roofs. Navy and Air Force officials also stated that inadequate  facility sustainment funding had resulted in deteriorated facilities, reduced  mission capabilities, and lower quality of life for installation personnel.  Navy officials stated that in some instances installation aircraft runways  have been closed because sustainment funds were not available to  perform needed repairs.
At the nine installations we visited, facility sustainment requirements were  not fully funded every year during fiscal years 2006, 2007, and 2008. At  some installations, facility sustainment had benefited from the use of some  supplemental funding provided for the Global War on Terrorism to pay for  some related facility repairs. Still, considering the levels budgeted for  sustainment and the use of some sustainment funds for other purposes,  the amount actually spent on facility sustainment at six of the nine  installations we visited was less than 75 percent of the estimated  requirement, as determined by DOD’s facilities sustainment model, during  fiscal years 2006 through 2008, and at three of these installations, the  amount spent was less than 60 percent of the estimated requirement.  Officials at the nine installations reported a total of $376 million in  backlogged facility sustainment needs.
Although many facilities at the installations we visited were in good  condition, some facilities had fallen into disrepair because funds were not  available to pay for all needed sustainment work. The following examples  illustrate the deteriorated conditions of some facilities we observed.
Officials at Fort Story, Virginia, stated that repairs costing about $2 million  for the installation’s command headquarters building had been deferred  because sustainment funds were not available. One needed repair involved  the building’s basement, which had been damaged from extreme moisture,  mold, and termites (see fig. 2). Due to the severity of the damage, the  basement was not being used and, because the building was occupied and  in daily use, a support wall had to be constructed to prevent the floor  above the basement, which is the floor of the building’s entrance, from  collapsing.
Officials at McChord Air Force Base, Washington, stated that window  repairs costing about $32,000 for the installation’s steam plant had been  deferred because sustainment funding was not available. The building’s  windows leak and allow water to flow onto the electrical panels of some  equipment in the plant. The leaks have occasionally caused the panels to  short out, which resulted in temporary electricity outages to portions of  the installation, potentially undermining operations (see fig. 3).
Officials at Naval Amphibious Base Little Creek, Virginia, stated that  repairs costing about $650,000 at an administrative building had been  deferred because of inadequate sustainment funding. Extensive water  leaks from interior pipes in the building had caused excessive mold and  mildew throughout the building (see fig. 4). The officials stated that one  employee received medical treatment as a result of exposure to the mold  in the building and other employees had experienced breathing  difficulties.
Officials at the Naval Air Engineering Station Lakehurst, New Jersey,  stated that the roof of the public works building leaked and needed to be  replaced. However, work had been deferred because sustainment funds  were not available to complete the work, which was estimated to cost  about $200,000. The leaks had caused mold and damage in sections of the  building and, in a recently refurbished conference room, a video display  had to be covered with plastic sheeting to prevent damage from the leaks  (see fig. 5).
section_title: Conclusions
paragraphs: While DOD has made a comprehensive effort to ensure consistent delivery  of installation support at the planned joint bases, the estimates of potential  savings will likely continue to decline and it is unclear whether joint  basing will result in any actual savings. The levels of service called for by  most standards were determined in view of DOD policies and practices,  industry standards, or from other federal agencies, but judgment was also  used to decide the standards in many areas. Because such decisions  involve trade-offs between alternative levels of service and affordability,  opportunities exist to review and, if needed, adjust these standards as  experience is gained to ensure that the standards reflect the level of  service necessary to meet installation requirements as economically as  possible. Similarly, opportunities also exist to periodically review and  address those instances where the military services’ approach to  implementing joint basing results in additional administrative costs or loss  of existing installation support efficiencies. Furthermore, in view of DOD’s  newly established common support standards, the associated increase in  the cost of installation support, and the significant decrease in expected  long-term savings from joint basing, a detailed cost analysis of the results  from the initial joint bases could assist the Congress in its oversight of this  effort.
The military services have exacerbated the underfunding of facility  sustainment requirements by using some budgeted sustainment funds for  other purposes. Although using budgeted sustainment funds for other  purposes is permissible, the result is that additional sustainment  requirements are not met, and according to DOD, when facilities are not  fully sustained, the facilities will likely experience reduced service lives  and more costly recapitalization requirements in the future. Until  additional attention is focused on facility sustainment spending, the  military services might continue spending some sustainment funds on  other purposes, thus leaving more sustainment needs unmet, which leads  to greater recapitalization costs in the future. Furthermore, without  updates on the amount of budgeted sustainment funds spent on other  purposes, OSD will not be well positioned to effectively manage the risk  associated with the redirection of sustainment funds and the Congress will  lack the information needed to make informed decisions and ensure  proper congressional oversight of the administration’s annual budget  submission for facility sustainment.
section_title: Recommendations for Executive Action
paragraphs: To address the expected increased installation support costs from joint  basing implementation and the use of budgeted facility sustainment funds  for purposes other than sustainment, we recommend that the Secretary of  Defense direct the Deputy Under Secretary of Defense (Installations and  Environment) to take the following four actions:    Periodically review the installation support standards as experience is  gained with delivering installation support at the joint bases and make  adjustments, if needed, to ensure that each standard reflects the level  of service necessary to meet installation requirements as economically  as possible.
Periodically review administrative costs as joint basing is implemented  to minimize any additional costs and prevent the loss of existing  installation support efficiencies.
Complete a detailed analysis of the estimated installation support costs  from the initial joint bases and report the results of the analysis to the  Congress in the department’s documents supporting the  administration’s annual budget submission or another document  deemed appropriate.
Increase the attention given to facility sustainment spending by  summarizing and reporting to the Congress the amount of budgeted  sustainment funds spent on other purposes in the department’s  documents supporting the administration’s annual budget submission  or another document deemed appropriate.
section_title: Agency Comments and Our Evaluation
paragraphs: In written comments on a draft of this report, the Deputy Under Secretary  of Defense (Installations and Environment) stated that our report provided  a comprehensive look into joint basing and facility sustainment funding  and that DOD partially agreed with the report’s four recommendations.
DOD partially agreed with our recommendation to periodically review the  installation support standards and make adjustments, if needed, to ensure  that each standard reflects the level of service necessary to meet  requirements as economically as possible. DOD agreed that the standards  may require refinement as mission requirements evolve, organizational  structures mature, and efficiencies improve installation support delivery.  However, because the joint base memorandum of agreement template  already requires periodic reviews to ensure that installation support is  delivered in accordance with appropriate, common, output level  standards, DOD stated that further action to implement the  recommendation was not necessary.
We agree that the memorandum of agreement template provides for the  individual joint bases to periodically review their delivery of installation  support and use of standards. However, while only the joint bases are  currently required to deliver services in accordance with these standards,  OSD officials told us that DOD developed the standards to define the level  of service that all military bases should ideally provide in delivering  installation support. Thus, because the standards are DOD-wide standards  and not merely joint base standards, our recommendation calls for  periodic reviews of these DOD-wide standards and not of the standards at  individual bases. Also, because military judgment was used to decide  many of the standards and support costs generally increase as the level of  service increases, we believe that the trade-offs between alternative levels  of service and affordability should be reconsidered as experience is  gained. For these reasons, we continue to believe that DOD needs to take  additional steps to periodically review the standards from a DOD-wide  perspective and make adjustments, if needed, to ensure that the standards  are appropriate and economical.
DOD partially agreed with our recommendation to periodically review  administrative costs as joint basing is implemented to minimize any  additional costs and prevent the loss of existing installation support  efficiencies. DOD stated that it had already established a process to  periodically review joint basing costs as part of DOD’s planning, program,  budget and execution system and that the joint base memorandum of  agreement template requires periodic reviews of mission and resource  impacts. Thus, DOD stated that further action to implement the  recommendation was not necessary.
DOD’s response to our recommendation describes the processes DOD  intends to use to review costs after the joint bases have been  implemented. However, our recommendation calls for reviewing costs  during the joint base implementation process—not only after  implementation has been completed. As illustrated by the examples cited  in this report, the opportunity to reduce some joint base administrative  costs and prevent the loss of existing installation support efficiencies  exists during the time that the individual installations are working out the  details on how to combine into a joint base. Thus, we continue to believe  that DOD needs to take additional steps to perform periodic reviews to try  to avoid losing existing efficiencies during the joint base implementation  process and to help ensure that each joint base is established as  economically and efficiently as possible.
DOD partially agreed with our recommendation to complete a detailed  analysis of the estimated installation support costs from the initial joint  bases and report the results of the analysis to the Congress. DOD stated  that it is collecting estimated installation support cost information at the  joint bases and that the information will be provided if the Congress  requests it. As discussed in this report, installation support costs at the  joint bases are expected to increase, at least in the short term, compared  to support costs before consolidation. Because this outcome is the  opposite of what was expected by the BRAC Commission, we believe that  the issue is particularly noteworthy. As such, we believe that DOD should  not only collect joint base installation support costs, as DOD stated it is  doing, but also complete an analysis that compares the costs to the  original cost expectations for the initial joint bases. We believe that the  information in the analysis will assist the Congress in its oversight of joint  basing and, as such, we continue to believe that DOD needs to proactively  report the results of the analysis to the Congress in the department’s  documents supporting the administration’s annual budget submission or  another document deemed appropriate.
DOD partially agreed with our recommendation to increase the attention  given to facility sustainment spending by summarizing and reporting to the  Congress the amount of budgeted sustainment funds spent on other  purposes. DOD stated that it will collect and summarize the amount of  budgeted sustainment funds spent on other purposes and that the  information will be provided if the Congress requests it. This action  partially addresses the recommendation. However, because we believe  that the information will assist the Congress in its oversight of sustainment  spending, we also continue to believe that DOD should proactively report  the information in the department’s documents supporting the  administration’s annual budget submission or another document deemed  appropriate.
DOD’s comments are reprinted in their entirety in appendix IV. DOD also  provided technical comments, which we have incorporated into this report  as appropriate.
We are sending copies of this report to the Secretary of Defense; the  Secretaries of the Army, the Navy, and the Air Force; the Commandant of  the Marine Corps; and the Director, Office of Management and Budget. In  addition, the report will be available at no charge on the GAO Web site at  http://www.gao.gov. If you or your staff have any questions on the  information discussed in this report, please contact me at (202) 512-4523  or leporeb@gao.gov. Contact points for our Offices of Congressional  Relations and Public Affairs may be found on the last page of this report.  GAO staff who made key contributions to this report are listed in   appendix V.
section_title: Appendix I: Scope and Methodology
paragraphs: To evaluate the Department of Defense’s (DOD) efforts and expected  costs to deliver installation support at the planned joint bases, we  reviewed the justification supporting the 2005 Defense Base Closure and  Realignment (BRAC) Commission’s recommendation that DOD establish   12 joint bases and examined DOD’s implementation plans, guidance, and  cost estimates associated with the delivery of installation support at the  planned joint bases. In addition, we reviewed recently issued DOD  guidance that provided common installation support definitions and   267 support standards, and that required joint bases to deliver support in  accordance with the definitions and standards. We discussed with the  Office of the Secretary of Defense (OSD) and military service officials the  status of joint base implementation, the basis for the new installation  support standards, and mechanisms established to help ensure that the  joint bases comply with DOD’s joint basing guidance. In assessing  expected changes in installation support costs at the joint bases, we  compared the military services’ fiscal year 2009 estimate of potential long- term savings from joint basing with the savings estimate made by the 2005  BRAC Commission, compared support cost estimates before and after  joint basing at the three initial joint bases that had completed such  estimates, discussed joint base support cost expectations and reasons for  cost changes with OSD and military service officials, and reviewed  information from the military services concerning past funding levels for  installation support. To gain local level insight into the planned delivery  and expected costs of installation support at the joint bases, we visited   3 Army, 3 Navy, and 3 Air Force installations that are consolidating into   4 of the 12 planned joint bases. We selected bases for visits that had the  highest potential reduction in jobs according to a DOD 2005 BRAC report.  At each installation visited, we discussed with local officials their views on  the delivery of installation support by the joint bases and expectations  regarding changes in support costs before and after implementation of the  joint bases. Also, to obtain some insight into how many support areas  might require increased service levels at the joint bases, we compared  current service levels to the joint base support standards at each  installation we visited. Specifically, we judgmentally selected 40 of the 267  support standards and compared the level of service that the installation  was currently providing to the level of service called for by the standard.
To evaluate DOD’s funding for facility sustainment at all installations, we  examined and compared DOD’s requirements and goals for facility  sustainment funding with the amounts actually budgeted and spent on  sustainment. Specifically, we reviewed DOD’s facility sustainment  requirements for fiscal years 2005 through 2008, as determined by DOD’s  facilities sustainment model; reviewed DOD’s installation strategic plans  to identify DOD’s goals for facility sustainment budgeting; obtained OSD  and military service information for fiscal years 2005 through 2008 that  showed the amounts budgeted for sustainment, spent on sustainment, and  budgeted for sustainment but spent for other purposes; and compared the  amounts budgeted and spent to the corresponding requirements and goals.  The amounts budgeted and spent represented official OSD and military  service information and we did not independently verify the amounts. In  cases where DOD goals were not met and where sustainment funds were  used for other purposes, we interviewed OSD and service officials to  discuss the reasons why and any associated consequences, including the  amounts of any deferred facility sustainment backlogs. We also reviewed  other DOD guidance related to facility sustainment and interviewed OSD  and service headquarters officials to further assess DOD’s goals, policies,  and practices related to facility sustainment, including the allocation of  sustainment funds to the installation level. We developed case studies on  facility sustainment requirements, funding allocations, and spending at the  installation level, and interviewed local officials about the consequences if  spending was less than requirements. To coordinate with our joint basing  work, we developed case studies at the nine installations visited in  connection with our joint basing work. Thus, because the installations we  visited were not randomly selected, information from the case studies  might not be representative of all military installations. During the  installation visits, we also observed and took photographs of installation  facilities that were in a deteriorated condition because needed  sustainment work had not been performed.
We conducted this performance audit from May 2008 through February  2009, in accordance with generally accepted government auditing  standards. Those standards require that we plan and perform the audit to  obtain sufficient, appropriate evidence to provide a reasonable basis for  our findings and conclusions based on our audit objectives. We believe  that the evidence obtained provides a reasonable basis for our findings  and conclusions based on our audit objectives.
section_title: Appendix II: Methods Used by the Military Services to Allocate Facility Sustainment Funds to the Installation Level
paragraphs: According to officials in each of the military services, the Department of  Defense (DOD) facilities sustainment model is used as a tool to allocate  facility sustainment funds to the installation level. However, some  differences exist among the services’ practices in allocating sustainment  funds. For example, according to Army officials, the Army first considers  each installation’s facility sustainment requirement, as determined by  DOD’s model. Then, the Army allocates funding to its installations based  on a set percentage of each installation’s requirements. The same  percentage is used for all installations and, historically, each installation  has been allocated about 70 to 75 percent of its sustainment requirement.  These funds are expected to be used to pay for routine sustainment work,  such as regular facility inspections, preventive maintenance, and service  calls, as well as some larger sustainment projects, such as roof  replacements. According to Army officials, in the past few years all  budgeted sustainment funds were not allocated to the installations. Some  funds were retained at Army headquarters and used to pay for unfunded  restoration and modernization projects related to specific Army  investment strategies, such as barracks improvement and upgrades to  transportation infrastructure.
According to Navy officials, the Navy first considers the facility  sustainment requirement of all installations, as determined by DOD’s  model, under each of the Navy’s regional commands. Then, the Navy  allocates funding based on a set percentage of each region’s total  sustainment requirement. The regions then allocate sustainment funds to  their installations. According to Navy officials, the percentage used to  allocate funds to the regions is determined by the amount of sustainment  funds that the Navy budgeted and the Navy’s practice of retaining a  portion of the funds at headquarters to centrally pay for some larger  sustainment projects, maintenance dredging, specialized inspections,  demolition projects, and some unfunded restoration and modernization  projects. With this practice in fiscal year 2008, the Navy allocated to each  of its regional commands about 55 percent of each region’s total  sustainment requirement. Some regional commands reallocate all of the  funds they receive to their installations based on the same percentage of  each installation’s sustainment requirement. Other regional commands  retain a portion of the funds they receive to pay for regional projects— such as design work on facility projects, larger sustainment projects, and  some unfunded restoration and modernization projects. Installations use  their sustainment funds to pay for routine sustainment work and can  submit to their regional commands or Navy headquarters a prioritized list  of needed larger sustainment projects, which compete for funding based  on Navy and regional priorities.
According to an Air Force official, the Air Force first considers the facility  sustainment requirement of all Air Force active, guard, and reserve  installations, as determined by DOD’s model. Then, the Air Force allocates  to each component about 90 percent of each component’s total  sustainment requirement. The components, in turn, allocate funding to  their major commands based on the commands’ specific mission needs  and their model-determined sustainment requirements, and the commands  allocate the funds to the installation level in accordance with execution  plans, unique funding priorities, and advice from financial management  and civil engineering experts.
According to a Marine Corps official, the Marine Corps first considers the  facility sustainment requirement of all installations, as determined by  DOD’s facilities sustainment model, under each of the Marine Corps’  regions. Then, the Marine Corps allocates funding based on a set  percentage of each region’s requirements. The same percentage is used for  all regions and, historically, each region has been allocated about 60  percent of its sustainment requirement. The regions then allocate  sustainment funds to their installations based on their specific knowledge  of each installation’s requirements. Installations are expected to use these  funds to pay for routine sustainment work, such as regular facility  inspections, preventive maintenance, and service calls. According to  Marine Corps officials, all budgeted sustainment funds are not allocated to  the regions. Some funds are retained at Marine Corps headquarters and  used to pay for larger sustainment projects. Specifically, each installation  can submit a prioritized list of larger sustainment projects to Marine Corps  headquarters. Headquarters decides which projects to fund based on  Marine Corps priorities and the amount of funds available, which is the  amount of budgeted funds that was not initially allocated to the regions.
section_title: Appendix III: List of Installation Support Functions and Number of Associated Standards for Joint Bases
paragraphs: The Department of Defense (DOD) issued joint basing implementation  guidance in January and April 2008 that for the first time established a set  of common definitions and standards for installation support. As shown in  table 5, the guidance defined 47 installation support functions and  provided 267 standards to help define the level of service that each joint  base is to provide for each of the support functions.
section_title: Appendix IV: Comments from the Department of Defense
section_title: Appendix V: GAO Contact and Staff Acknowledgments
subsections: section_title: Acknowledgments
paragraphs: In addition to the contact named above, Mark Little, Assistant Director;  Kate Lenane; Jeanett Reid; Geoffrey Peck; Charles Perdue; and Gary  Phillips made significant contributions to this report.
section_title: Related GAO Products
paragraphs: Military Base Realignments and Closures: DOD Faces Challenges in  Implementing Recommendations on Time and Is Not Consistently  Updating Savings Estimates. GAO-09-217. Washington, D.C.: January 30,  2009.
Military Base Realignments and Closures: Army Is Developing Plans to  Transfer Functions from Fort Monmouth, New Jersey, to Aberdeen  Proving Ground, Maryland, but Challenges Remain. GAO-08-1010R.  Washington, D.C.: August 13, 2008.
Military Base Realignments and Closures: Higher Costs and Lower  Savings Projected for Implementing Two Key Supply-Related BRAC  Recommendations. GAO-08-315. Washington, D.C.: March 5, 2008.
Defense Infrastructure: Realignment of Air Force Special Operations  Command Units to Cannon Air Force Base, New Mexico. GAO-08-244R.  Washington, D.C.: January 18, 2008.
Military Base Realignments and Closures: Estimated Costs Have  Increased and Estimated Savings Have Decreased. GAO-08-341T.  Washington, D.C.: December 12, 2007.
Military Base Realignments and Closures: Cost Estimates Have  Increased and Are Likely to Continue to Evolve. GAO-08-159. Washington,  D.C.: December 11, 2007.
Military Base Realignments and Closures: Impact of Terminating,  Relocating, or Outsourcing the Services of the Armed Forces Institute of  Pathology. GAO-08-20. Washington, D.C.: November 9, 2007.
Military Base Realignments and Closures: Transfer of Supply, Storage,  and Distribution Functions from Military Services to Defense Logistics  Agency. GAO-08-121R. Washington, D.C.: October 26, 2007.
Military Base Realignments and Closures: Plan Needed to Monitor  Challenges for Completing More Than 100 Armed Forces Reserve  Centers. GAO-07-1040. Washington, D.C.: September 13, 2007.
Defense Infrastructure: Challenges Increase Risks for Providing Timely  Infrastructure Support for Army Installations Expecting Substantial  Personnel Growth. GAO-07-1007. Washington, D.C.: September 13, 2007.
Military Base Realignments and Closures: Observations Related to the  2005 Round. GAO-07-1203R. Washington, D.C.: September 6, 2007.
Military Base Closures: Projected Savings from Fleet Readiness Centers  Are Likely Overstated and Actions Needed to Track Actual Savings and  Overcome Certain Challenges. GAO-07-304. Washington, D.C.: June 29,  2007.
Military Base Closures: Management Strategy Needed to Mitigate  Challenges and Improve Communication to Help Ensure Timely  Implementation of Air National Guard Recommendations. GAO-07-641.  Washington, D.C.: May 16, 2007.
Military Base Closures: Opportunities Exist to Improve Environmental  Cleanup Cost Reporting and to Expedite Transfer of Unneeded Property.  GAO-07-166. Washington, D.C.: January 30, 2007.
Military Bases: Observations on DOD’s 2005 Base Realignment and  Closure Selection Process and Recommendations. GAO-05-905.  Washington, D.C.: July 18, 2005.
Military Bases: Analysis of DOD’s 2005 Selection Process and  Recommendations for Base Closures and Realignments. GAO-05-785.  Washington, D.C.: July 1, 2005.
subsections: section_title: Defense Infrastructure
paragraphs: High-Risk Series: An Update. GAO-09-271. Washington, D.C.: January  2009.
Defense Infrastructure: High-Level Leadership Needed to Help  Communities Address Challenges Caused by DOD-Related Growth.   GAO-08-665. Washington D.C.: June 17, 2008.
Defense Infrastructure: Continued Management Attention Is Needed to  Support Installation Facilities and Operations. GAO-08-502. Washington,  D.C.: April 24, 2008.
Defense Infrastructure: DOD Funding for Infrastructure and Road  Improvements Surrounding Growth Installations. GAO-08-602R.  Washington, D.C.: April 1, 2008.
Defense Infrastructure: Army and Marine Corps Grow the Force  Construction Projects Generally Support the Initiative. GAO-08-375.  Washington, D.C.: March 6, 2008.
Defense Infrastructure: Issues Need to Be Addressed in Managing and  Funding Base Operations and Facilities Support. GAO-05-556.  Washington, D.C.: June 15, 2005.
Military Training: Better Planning and Funding Priority Needed to  Improve Conditions of Military Training Ranges. GAO-05-534.  Washington, D.C.: June 10, 2005.
Defense Infrastructure: Changes in Funding Priorities and Strategic  Planning Needed to Improve the Condition of Military Facilities.   GAO-03-274. Washington, D.C.: February 19, 2003.