Defense Infrastructure: DOD Needs to Improve Oversight of Relocatable Facilities and Develop a Strategy for Managing Their Use across the Military Services
Published: 2009-06-12T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: The concurrent implementation of several major Department of Defense (DOD) force structure and infrastructure initiatives has stressed the ability of traditional military construction to provide enough permanent living and working space for servicemembers and other DOD personnel. As a result, the services are using some movable--or relocatable--facilities as barracks, administrative offices, medical facilities, dining halls, and equipment maintenance facilities to meet short-term needs. In Senate Report 110-77, the Senate Committee on Armed Services directed GAO to review the subject. This report assesses the extent to which (1) the Office of the Secretary of Defense (OSD) is providing oversight of the services' use of relocatable facilities to meet physical infrastructure needs, and (2) DOD has a strategy for managing such facilities. GAO assessed data reported to OSD on relocatable use and cost as well as visited seven defense installations selected from those identified as having a sizeable number of relocatable facilities.
section_title: What GAO Found
paragraphs: Although DOD considers the use of relocatable facilities a temporary measure to meet short-term physical infrastructure needs, the Office of the Secretary of Defense (OSD) is not providing effective oversight of the number or cost of its relocatable facilities. OSD officials told GAO in March 2008 that they did not have information about how many relocatable facilities were being used, how many defense installations had them, or how much it has cost to acquire them. Subsequently, the military services reported to OSD that they have acquired over 4,000 relocatable facilities at an estimated cost of about $1.5 billion over a 5-year period. However, GAO's assessment of these data showed that the data were inaccurate and incomplete. At six of the seven installations visited, GAO found discrepancies between the number of relocatable facilities located on those installations and the numbers that the services had reported to OSD. For instance, at Camp Lejeune, North Carolina, installation officials told GAO the installation had about 170 relocatable facilities, which is about 80 more than the Marine Corps headquarters reported to OSD. Such discrepancies occurred in part because OSD has not provided the services with a clear definition of relocatable facilities. In addition, OSD lacks a mechanism for collecting and maintaining reliable data on these facilities. A clear, ongoing requirement for OSD to collect and maintain consistent data on relocatable facilities would better enable it to manage the use of these facilities to provide working and living space for military personnel. OSD has not developed a comprehensive strategy for managing relocatable facilities departmentwide. Although the military services plan to replace many of their relocatable facilities with permanent construction, some officials GAO spoke with expressed skepticism that the planned replacement funds will become available. In addition, GAO found that these facilities at many installations have been in use longer than the 3 years DOD's guidance states it normally expects. Furthermore, some Army officials told GAO that due to several force structure and infrastructure initiatives, it expects that the influx of more military personnel at some installations could exacerbate the shortage of facilities, which could mean more relocatable facilities might be needed. Meanwhile, some DOD installations may be planning to acquire new relocatable facilities at market cost at the same time that other installations are disposing of them. Although the Army is moving in the direction of centralizing its management of relocatable facilities, none of the other military service headquarters told GAO they have initiated similar efforts. Because OSD does not have a comprehensive DOD-wide strategy for managing the use of relocatable facilities--including the transfer of relocatables from one location to another--the services could unnecessarily spend DOD funds by simultaneously acquiring new facilities at some locations while auctioning off or incurring costs to store or demolish similar facilities at other locations.

section_title: Letter
paragraphs: The Department of Defense’s (DOD) concurrent implementation of several  major force structure and infrastructure initiatives has stressed the  traditional military construction processes to provide needed living and  working space for servicemembers and other DOD personnel. These  initiatives—such as the continued transformation of the Army’s force  structure from an organization based on divisions to more rapidly  deployable, combat brigade–based units; the implementation of about   800 Base Realignment and Closure actions by 2011; the planned increase  in the active-duty end strength of the Army and the Marine Corps by a  combined 92,000 military members; and the planned drawdown of troops  from Iraq—will place new and changing demands on DOD’s capability to  provide sufficient living and working space at many installations by the  time these initiatives and actions are expected to be completed. The  military services, in response to current shortages in physical  infrastructure, are using a large number of movable—or relocatable— facilities as barracks, administrative offices, medical facilities, dining halls,  and equipment maintenance facilities. Such relocatable facilities can  consist of a single trailer, or a set of trailers assembled together to form a  larger, modular-type structure.
In Senate Report 110-77, the Senate Armed Services Committee expressed  concern about DOD’s use and cost of temporary facilities and the  possibility that such facilities would eventually be considered an  acceptable working or living standard. The committee directed the Under  Secretary of Defense for Acquisition, Technology and Logistics to report in  July 2008 to the congressional defense committees on the use of such  facilities within DOD. The committee also directed us to analyze and  report on the Office of the Secretary of Defense’s (OSD) report within   90 days of the OSD report issuance. However, as of May 2009, OSD had not  issued its report to the congressional defense committees; therefore we  have not evaluated OSD’s report. The committee also stipulated that we  may conduct independent research and make independent findings and  recommendations. Accordingly, this report discusses DOD’s use of  relocatable facilities to meet its physical infrastructure needs. Specifically,  we assessed the extent to which (1) OSD is providing oversight of the  military services’ use of relocatable facilities to meet physical  infrastructure needs, and (2) DOD has a strategy for managing such  facilities.
To address these objectives, we reviewed DOD and military service  guidance on the use of relocatable facilities; obtained and reviewed  inventory and cost data on relocatable facilities from each of the military  services, which they reported to OSD for use in its pending report; and  interviewed OSD and service headquarters officials responsible for  overseeing the use of relocatable facilities. To gain insight into the  numbers, costs, and disposal plans for relocatable facilities at the  installation level, we visited seven installations, mostly focusing on the  Army and the Marine Corps installations because the data they reported to  OSD showed more extensive use of relocatable facilities than the Navy  and the Air Force reported. We selected these installations to visit from  those identified by service headquarters officials as having a sizable  number of relocatable facilities. The Senate committee report limited  DOD’s review by excluding nonpermanent or temporary facilities used  overseas at forward operating sites or cooperative security locations, thus  we did not include the services’ use of relocatable facilities at overseas  locations. Our analysis of the seven installation visits cannot be  generalized to other military installations. At each installation we visited,  we compared installation data on the number and cost of relocatable  facilities with similar data provided by each service headquarters to OSD  and discussed any discrepancies identified. We also visited the Army  Installation Management Command–West, Texas, to discuss the Army’s  use of relocatable facilities. We conducted this performance audit from  February 2008 to June 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. A  more detailed description of our scope and methodology is included in  appendix I of this report.
subsections: section_title: Background
paragraphs: According to DOD, a relocatable facility is a building designed to be  readily moved, erected, disassembled, stored, and reused. In classifying  buildings as relocatable, the estimated costs for average building  disassembly, repackaging, and nonrecoverable building components,  including typical foundations, may not exceed 20 percent of the building  acquisition cost. DOD has stated that these facilities may be used when  they constitute the most feasible and economical means of satisfying an  interim facility requirement, which they have defined as a short-term,  normally 3 years or less, requirement due to transitory peak military  missions, deployments, military contingency operations, disaster relief;   or urgent requirements, pending approval and construction of facilities  through normal military construction programs. Such facilities can  consist of a single trailer, or a set of trailers assembled together to form a  larger, modular-type structure. The military services acquire relocatable  facilities by either buying or leasing them, depending on the results of an  economic analysis to determine the most economical approach.
In response to OSD’s request for data on the military services’ use of  relocatable facilities over the past 5 years, the services reported that they  have bought or leased over 4,000 relocatable facilities and have spent  about $1.5 billion to acquire them. According to these data, the Army and  the Marine Corps have relied on relocatable facilities the most, reporting  to OSD that they have about 2,800 and 800 of these facilities respectively.  The Navy and the Air Force reported to OSD that they have about 400 and  200 relocatables respectively. Typically, the military services are using  relocatable facilities as barracks, administrative offices, medical facilities,  dining halls, and equipment maintenance facilities. Some relocatable  facilities we saw during our installation visits are shown in figure 1.
subsections: section_title: Oversight and Guidance
paragraphs: The Office of the Deputy Under Secretary of Defense for Installations and  Environment issues guidance on relocatable facilities. DOD last issued  guidance on relocatable buildings in 1988. According to that guidance,  unlike other nonpermanent buildings, relocatable facilities are to be  accounted for as personal property rather than real property, unless these  facilities are authorized for procurement using construction procedures, in  which case the buildings should be accounted for as real property.  Additionally, the guidance states that in classifying a building as  relocatable, it must meet a requirement known as the “20 percent rule.”  This rule generally means the estimated costs for disassembling the  building and repackaging it for storage or reuse, among other cost  considerations, may not exceed 20 percent of the cost to acquire the  facility. Generally, relocatable facilities are acquired as personal property  using procurement or operation and maintenance appropriations. If other  buildings do not meet the 20 percent rule, they are acquired as real  property with military construction or with operation and maintenance  appropriations.
In addition to DOD’s guidance, each of the military services have also  developed specific guidance to govern the management, acquisition, and  disposition of relocatable facilities. For example, to provide more specific  guidance on funding relocatables, the Army has issued its own amplifying  guidance. This guidance follows DOD Instruction 4165.56 that states that  relocatable buildings procured and accounted for in a particular manner  are considered personal property. The Army used the funding limits for  procurement of equipment when it outlined the funds to be used for  relocatable facility acquisition in both an Army regulation and interim  policy for relocatable buildings. If the cost to buy or lease relocatables is  under $250,000, the Army is to use funds from its Operation and  Maintenance appropriations, however if the cost is $250,000 or more, it is  to use funds from its Other Procurement, Army, appropriation. In contrast,  if the Army is acquiring other buildings, meaning real property, it generally  uses funds from its Military Construction appropriations for projects over  $750,000.
section_title: Committee Interest on Relocatable Facilities
paragraphs: In addition to the committee interest that led to our review, other  congressional committees have previously expressed interest in DOD’s use  of relocatable facilities, specifically within the Department of the Army.  For example:  In 2005, the Senate Armed Services Committee expressed concern that  the Army had not included funds to sustain or replace trailers with  permanent facilities, among other issues.
Also in 2005, the House Armed Services Committee noted that it was  troubled by the Army’s reliance on temporary facilities to support its  modularity initiative and the Army’s failure to budget for permanent  construction to replace temporary facilities. The House Armed Services  Committee further directed the Army to report on several issues related to  the use and replacement of temporary facilities, and the Army provided its  report in March 2006.
More recently, the House Armed Services Committee directed OSD to  submit to the defense committees by March 1, 2009, the department’s plan  to replace relocatable buildings with permanent facilities by fiscal year  2015. OSD officials told us they planned on providing these committees  with this report as well as the report directed by the Senate Armed  Services Committee that was due in July 2008, although they had not yet  done so as of May 2009. To develop these reports, OSD requested that the  military services provide data, and the services generally did the following  in response to OSD’s data request:    Army headquarters officials stated that the Army updated its information  on relocatable facilities in March 2008 by requesting data from its  installations. Officials noted that these data were compared to data in the  Army’s real property database to supplement its completeness. The Army  provided its data to OSD in the summer of 2008.
Navy headquarters officials stated that the Navy used its database on  facilities to obtain information on the number of relocatable facilities it is  using. The Navy then provided these data to each of its 13 regions to  review and supplement with data not contained in the database. The Navy  provided its data to OSD during the summer of 2008.
Marine Corps headquarters requested data from its major commands,  citing that it was the responsibility of its commands to obtain data on  relocatable facility use. The Marine Corps provided its data to OSD in the  fall of 2008.
Air Force headquarters requested the civil engineer for each of its major  commands, who in turn tasked the civil engineer for each Air Force  installation, to provide data on relocatable facility use. The Air Force  provided its data to OSD in the summer of 2008.
section_title: OSD Does Not Have Complete Oversight of the Services’ Use of Relocatable Facilities to Meet Infrastructure Needs
paragraphs: Although military services are relying on relocatable facilities to meet  shortages in their physical infrastructure needs, OSD lacks oversight over  how many of these facilities are being used on defense installations and  how much DOD has spent on such facilities. Neither OSD nor the services  have a complete or accurate accounting of the number or cost of  relocatable facilities because OSD has not issued clear guidance on how  the military services should define relocatable facilities, and it lacks a  mechanism for collecting and maintaining consistent use and cost data  across the services.
subsections: section_title: OSD Does Not Fully Know How Many Relocatable Facilities the Services Are Using to Meet Physical Infrastructure Needs
paragraphs: OSD does not have accurate and complete data on the number of  relocatable facilities that the services are using to meet current shortages  in their physical infrastructure needs. Although the military services  recently reported to OSD that they have bought or leased over 4,000  relocatable facilities over a 5-year period, our assessment of the data  uncovered many discrepancies. At six of the seven installations we visited,  including locations representing each of the military services, we found  discrepancies between the number of relocatable facilities located on  those installations and the number that the service headquarters had  reported to OSD. For instance:    At Fort Bliss, Texas, officials showed us over 100 relocatable facilities  located on the installation that were not included in Army’s data provided  to OSD on relocatable facilities. Army headquarters did not know about  these facilities until shortly prior to our visit.
At Camp Lejeune, North Carolina, officials told us that the installation had  about 170 relocatable facilities, which was about 80 more than Marine  Corps headquarters had reported to OSD. Marine Corps headquarters  officials told us they had no way to reconcile the discrepancies and  suggested we ask the Marine Corps Forces Command, which was tasked  to collect inventory data on relocatable facilities for its installations. Those  officials stated that there is a lot of subjectivity in the definitions of  relocatable facilities, which is contributing to data discrepancies.
At Camp Pendleton, California, officials told us they only had 2 relocatable  facilities; however, Marine Corps headquarters reported to OSD that the  installation had a total of 330 relocatables and other nonpermanent  facilities. Marine Corps headquarters officials told us there is confusion as  to how many relocatable facilities are actually at Camp Pendleton. Based  on our audit work, we believe there are several factors contributing to the  data discrepancies. First, Marine Corps headquarters included both  relocatable facilities as well as other nonpermanent facilities in their  numbers in response to OSD’s data request. Second, Marine Corps  headquarters also included future requirements for these facilities at Camp  Pendleton even before obtaining the relocatable facilities. Third, Camp  Pendleton officials told us they changed the property classification on  their relocatable facilities from personal property to real property based  on communications from Marine Corps headquarters officials. Camp  Pendleton officials told us they properly classified these facilities although  Marine Corps headquarters officials told us the reclassification was not  correct. As of April 2009, Camp Pendleton officials told us their data had  not changed.
At Fort Hood, Texas, we found over 25 facilities that appeared to us to be  relocatable facilities but were not accounted for as such. After our review  of the installation’s facility records, Fort Hood officials agreed that the  facilities we had questioned should have been included in its count of  relocatable facilities.
We found other instances of data discrepancies at two other installations  we visited. Although these discrepancies were minor, they nonetheless  still represent an inaccurate count. At Naval Amphibious Base Little  Creek, Virginia, officials told us that they had three fewer relocatable  facilities than the data reported to OSD showed. Also, at Eglin Air Force  Base, Florida, service officials told us they had two fewer relocatable  facilities than the data reported to OSD showed, citing that one facility  was counted twice and one facility was no longer at the installation.
Similar data discrepancies in the number of relocatable facilities on some  Army installations were also reported on by the Army Audit Agency. At  the request of the Assistant Secretary of the Army (Financial Management  and Comptroller), the Army Audit Agency recently conducted a review on  the Army’s management of its relocatable facilities and reported on its use  at five Army installations—Fort Bragg, North Carolina; Fort Drum, New  York; Fort Huachuca, Arizona; Fort Riley, Kansas; and Fort Stewart,  Georgia. The Army Audit Agency reported that it found discrepancies in  the inventory of relocatable facilities at all five installations it reviewed.  For example, the Army Audit Agency reported that Fort Bragg actually had  about 20 more relocatable facilities than what was recorded in Army’s  database. As a result, the Army Audit Agency reported that Fort Bragg had  lost visibility and accountability for relocatable facilities that could result  in incorrect decisions on the management of these facilities.
In addition, both the Army and the Marine Corps—two of the military  services that rely on relocatable facilities the most, according to data these  services provided to OSD—told us there might be relocatables located at  their installations that they do not know about. For example, Army  officials told us they do not know if Army National Guard installations and  readiness centers have relocatable facilities given that the Army National  Guard manages its own facility needs and Army headquarters does not  have readily available data on such use. In addition, Army officials said  that some tenants on an installation might be using relocatable facilities  that have not been accounted for at the host installation. These officials  told us that tenants, like DOD’s Domestic Dependent Elementary and  Secondary School system, could be using relocatable facilities on an  installation that the installation might not be aware of, which also presents  challenges in maintaining a complete and accurate inventory of these  facilities. Also, Army officials told us that they do not know the extent to  which relocatable facilities might be on Army training ranges given the  millions of acres of land in the ranges and that an accurate count would be  difficult to verify. Moreover, Marine Corps headquarters officials told us  they were not sure if their inventory count of relocatable facilities was  complete since they do not routinely maintain data on relocatables at the  headquarters level.
Furthermore, Navy headquarters told us its data provided to OSD did not  include all of its relocatable facilities located at its installations. For  example, Navy officials told us they did not collect and report data on  relocatable facilities from four of its major commands—Naval Air Systems  Command; Naval Sea Systems Command; Space and Naval Warfare  Systems Command; and the Bureau of Medicine and Surgery—a lthough  the Navy estimated that these four commands had about 200 relocatable  facilities. Navy officials told us they did not collect and report data on  relocatables for these four Navy commands because OSD was  independently seeking the data. However, OSD officials told us they did  not request data specifically from these Navy commands and that its  expectation was that each service would collect its own data covering the  entire service. Also, Navy officials told us they could not verify their data  collection on relocatables by major command because all of the collected  data was accidentally lost when a computer failed and that the Navy does  not routinely maintain data on relocatables at the headquarters level.
Air Force officials, on the other hand, told us it does routinely collect data  on relocatable facilities at the headquarters level for inclusion in its annual  report; however, the Air Force last reported on the use of relocatable  facilities in fiscal year 2006 and has not issued its annual reports on its  usage in fiscal years 2007 or 2008.
Also, some service officials expressed confusion about whether other  types of facilities should be included in their count of relocatables. For  example, some officials asked us if certain types of structures, such as  equipment sheds and rain shelters, should be counted as relocatable  facilities. We also found that the Air Force does not count a certain type of  facility called Sprung shelters—which are generally a rigid frame structure  covered by heavy tension fabric—as relocatable facilities if it buys them,  but will count them if it leases them. On the other hand, the other three  military services count these facilities as relocatables depending on the  proper application of the relocatable definition. DOD’s instruction on  relocatable buildings does not address these structures. Two examples of  Sprung shelters are shown in figure 2.
OSD does not have adequate oversight over the military services’ use of  relocatable facilities to meet its physical infrastructure shortages based on  our observations on the difficulty some of the services had to collect data  on these facilities and our assessment that these data are inaccurate and  incomplete. DOD’s Instruction 4165.56 on relocatable facilities prescribes  policies and procedures for the acquisition and use of these facilities;  however, officials with the Navy and the Marine Corps headquarters and  several officials at installations we visited told us OSD’s guidance on  defining relocatable facilities was confusing to distinguish relocatables  from other types of nonpermanent facilities because the definition of these  types of facilities was not clear. This distinction is important because DOD  generally considers relocatable facilities to be personal property—like  vehicles and other equipment—which is acquired using either  procurement or operation and maintenance appropriations—whereas  other types of buildings, including temporary buildings, are considered  real property, which are funded mostly through military construction  appropriations and, in some cases, operation and maintenance  appropriations. Furthermore, without a clear definition of relocatable  facilities, DOD will not be able to reliably determine the extent to which  the services are relying on these facilities to meet shortages in needed  facilities.
section_title: OSD Does Not Fully Know How Much the Services Have Spent to Acquire Relocatable Facilities
paragraphs: Although some of the services’ headquarters have begun to capture the  cost of acquiring relocatable facilities, based on our analysis we believe  these data are not reliable and the total cost of relocatable facilities  acquired by the military services is uncertain. According to cost data we  obtained from the services, DOD estimates it has spent about $1.5 billion  over a 5-year period to acquire relocatable facilities, yet service officials  told us that because the number of relocatable facilities was uncertain,  then the associated cost to acquire these facilities was also uncertain.  Also, some service officials told us that collecting acquisition cost data  was difficult given that reliable records on these costs were not always  available and that maintaining information on these costs had not been a  priority. For example, Navy and Marine Corps headquarters told us that  they did not maintain any cost information on relocatable facilities,  although they told us cost information on relocatables should be readily  available at the installation. However, during our visit to Camp Lejeune,  North Carolina, and Little Creek Naval Amphibious Base, Virginia, officials  at both installations told us that their cost data to acquire relocatable  facilities were incomplete. Marine Corps officials at Camp Lejeune told us  that they did not retain cost information on their relocatable facilities prior  to March, 2007, thus they could not provide acquisition cost data covering  the last 5 years as requested by OSD. Likewise, Navy officials at Little  Creek Naval Amphibious Base told us that their cost data on relocatable  facilities were their best estimates given that they did not maintain the  contracts for all of their leased relocatable facilities.
Army officials stated that although the service updated its cost data for  their relocatable facilities in March 2008, the data are not complete for all  installations. According to these officials, the cost information reported  represents the best available data.
The Air Force, in response to direction from the Secretary of the Air  Force, is to produce an annual report that captures the costs of acquiring  relocatable facilities; however, the most recently completed annual report  was for 2006. Air Force officials noted that a 2007 report was never  officially completed, and as of February 2009, it had not begun to gather  the data needed for the 2008 report. The officials told us they were  relatively unconcerned about the size or cost of their inventory of  relocatable facilities compared to other physical infrastructure issues,  given the low use of relocatables located on their installations.
section_title: Limited Oversight of Relocatable Facilities Hindered OSD’s Ability to Respond to Congressional Request for Information
paragraphs: OSD does not have adequate oversight over the military services’ use or  cost to acquire relocatable facilities although it sets policy and develops  overarching instructions on relocatable use. As a result, OSD’s limited  oversight over the military services’ use of relocatable facilities has  hindered its ability to respond to congressional requests for such  information. For example, OSD was expected to issue its report in  response to direction from the Senate Armed Services Committee in July  2008; however, it had not yet done so by May 2009. When we talked to  OSD officials in March 2008, these officials told us they did not have  information about how many relocatable facilities were being used, how  many defense installations had them, nor how much it had cost to acquire  them. OSD requested information from each of the military services but  OSD officials told us they had experienced some data-collection problems.
Despite receiving information from the services, our work has shown that  OSD still does not have reliable information given a number of identified  discrepancies among the installations, service headquarters, and  information provided to OSD on relocatable facilities numbers and  associated acquisition cost. DOD’s guidance states that DOD-owned  equipment and other accountable property, such as relocatable facilities,  should be properly inventoried, records should reflect current status, and  documentation should be maintained to permit validation of information  such as the purchase cost. Although the military services provided data  in response to OSD’s request indicating they had acquired over 4,000  relocatable facilities over a 5-year period recently, it will be difficult for  OSD to know the extent the services are relying on these facilities because  it lacks a mechanism for collecting and maintaining such information as  required by its own guidance.
section_title: OSD Does Not Have a Strategy for Managing the Use and Disposal of Relocatable Facilities
paragraphs: OSD does not have a strategy for managing the military services’ use and  disposal of relocatable facilities, even though many of these facilities most  likely will be used for longer than the 3 years that is normally expected for  relocatables. In the absence of such a strategy, the services are at risk of  managing these facilities in an inefficient manner.
subsections: section_title: Military Services Expect to Use Relocatable Facilities Longer than Called for by DOD Guidance
paragraphs: Recognizing that the services would prefer to use permanent buildings to  meet their infrastructure needs, some relocatable facilities could remain in  use for many years. According to DOD guidance, the military services are  expected to use relocatable facilities when they constitute the most  feasible and economical means of satisfying an interim facility  requirement, which is a short-term—normally 3 years or less— requirement for facilities in order to meet urgent or peak facilities  requirements. However, we found that relocatable facilities at many  installations have already been in use for longer than 3 years. The Army  recently issued guidance indicating that it normally expects its relocatable  facilities to be used for no more than 6 years, and officials at Fort Bliss,  Texas, told us that about 550 of its nearly 600 relocatables, which are  already more than 3 years old, will be used at least 5 more years until 2014  to meet new incoming missions due to the lack of permanent facilities.  Similarly, Marine Corps headquarters officials noted that rapid growth,  changes in missions, and reorganizations have created new facility  requirements that outstrip the Marine Corps’ ability to meet the  requirements through permanent construction. Thus, the Marine Corps  continues to look to the use of relocatable facilities as the only available  option to meet the needs. The officials stated that most likely relocatable  facilities will be used at many installations for longer than 3 years.
section_title: Services Plan to Replace Relocatable Facilities with Permanent Buildings, but Could Face Management Challenges
paragraphs: Although the services plan to eventually replace many of their relocatable  facilities with permanent buildings, and military construction funds have  been programmed to do so in fiscal years 2010 to 2013, some service  officials expressed skepticism that the planned replacement funds will  become available, potentially further prolonging the need for relocatables.  Even if planned military construction funds are appropriated in the later  years, some of these relocatable facilities will have been in use beyond the  normal amount of time as indicated in DOD’s instruction. For example:    Navy officials at Little Creek Naval Amphibious Base, Virginia, told us that  they expect to obtain funding in fiscal year 2012 to begin permanent  construction to replace some of the installation’s relocatable facilities.  However, for many of their relocatable facilities, they said they might not  receive funding until fiscal year 2014. Once funding is received, the  officials told us it generally takes about 2 years to build a permanent  facility. Thus these relocatable facilities, acquired in November 2004, will  be approximately 12 years old when replaced. Furthermore, these officials  also expect some existing relocatable facilities to be used beyond 2014  because they are being used as administrative buildings, which the  officials told us have not competed well historically for military  construction appropriations within DOD.
Army officials at Fort Bliss, Texas, told us they are currently using about  550 relocatable facilities to house a combat brigade pending permanent  construction to replace these facilities. The officials said they plan to use  these facilities, which were acquired in 2006, until at least 2014, at which  time these facilities will be approximately 9 years old.
Air Force officials at Eglin Air Force Base, Florida, provided us  information that shows 27 of their 36 relocatables are currently over 5  years old. In fact, 3 of these facilities were acquired in March 1984, making  them 25 years old. The officials noted that these facilities were scheduled  to be replaced in 2009; however, they said the facilities will continue to be  used for administrative purposes to support a training range.
Of the military services, the Army and the Marine Corps are the most  affected by the implementation of DOD’s force structure and  infrastructure initiatives and will be challenged the most to find ways to  meet their physical infrastructure needs in the short term. With the recent  passage of the American Recovery and Reinvestment Act of 2009, DOD  plans to spend about $7 billion in funds on numerous infrastructure  projects, among other items and activities, which in turn, holds the  possibility that certain funded projects could lessen the need to rely on  relocatable facilities at certain installations although it still might be too  early to quantify such effects. On the other hand, other recent decisions  could increase the use of relocatables. For example, officials at Fort Bliss,  Texas; Fort Drum, New York; and at Army Installation Management  Command–West, Texas, told us that, if the proposed drawdown of troops  from Iraq occurs as planned—on top of DOD’s other force structure  initiatives—the influx of more military personnel could exacerbate the  shortage of facilities at these and other installations. Meeting these facility  needs could result in an increased use of relocatable facilities and the  continued use of these facilities for longer than normally called for by  DOD guidance.
Army officials told us that installation commanders generally consider  relocatables to be the property of their installations. Thus, even though  plans exist to replace relocatable facilities with permanent construction,  some installation commanders might be resistant to transferring their  relocatables to another installation that needs them or even to disposing of  them once the planned permanent buildings have been constructed, in  case they are subsequently needed again. Although the Army has not yet  redistributed any relocatables from one location to another, Army officials  told us that they are in the process of trying to redistribute some  relocatable facilities from Fort Irwin, California—an installation in which  the Army believes it no longer needs its relocatable facilities—to Fort Sill,  Oklahoma—an installation that currently needs relocatable facilities to  address some of its facility space shortages. Although the Army plans to  centralize its management of these facilities, neither the other service  headquarters nor OSD have similar plans. Without a DOD strategy for  managing relocatables that includes the redistribution of relocatables from  one location to another when needed and when appropriate, installations  with unneeded relocatables could unnecessarily spend defense funds  disposing of facilities while another installation that needs them is  spending defense funds to acquire them.
When appropriate to dispose of relocatable facilities, neither OSD nor the  services have completed disposal strategies nor budgeting for the cost  involved to remove these facilities. Officials told us relocatable facilities  used today are often not facilities that can be easily towed away or sold at  on-site auctions, such as would be true with single trailers with attached  wheels. Rather, some installation officials told us that disposing of these  facilities by auctioning them off in the local community might be more  challenging than what is currently expected given these facilities normally  arrive on flat-bed trucks and are either largely preassembled or assembled  at the installation, as shown in figure 3.
For example, officials at Fort Bliss, Texas, told us they expect to incur  costs to dispose of or demolish their relocatable facilities, citing doubts  that enough of their facilities could be auctioned off in the local  community given the large quantities (about 600) of relocatable facilities at  the installation. Officials at Fort Hood expressed similar views regarding  the salvage value of the relocatable facilities at their installation, given the  large quantities (nearly 300) of relocatable facilities that will need to be  disposed of. Officials at Fort Drum, New York, told us that once their  installation no longer needs its relocatable facilities (about 140), they plan  to disassemble them and store the facilities on base, which officials said  will likely incur cost to do.
Furthermore, the numbers of relocatable facilities for DOD to eventually  dispose of could be more challenging given the actual size of some of  these relocatable facilities. DOD currently counts as relocatables multiple  trailers, which can be joined together, as one facility. For example,  according to Air Force data, a facility at MacDill Air Force Base in Florida  is actually made up of 72 trailers. We saw a similar situation at Little Creek  Naval Amphibious Base, Virginia, in which officials there counted 146  trailers, many of which were connected to one another, as 23 relocatable  facilities. Also, at Eglin Air Force Base, Florida, one relocatable facility— representing about 35,000 square feet of space—was actually comprised of  33 individual trailers, as shown in figure 4.
DOD’s guidance states that relocatable facilities accounted for as personal  property, upon becoming excess to DOD, shall be redistributed or  disposed of. However, OSD has not effectively communicated guidance  on how the services are to manage its reliance on relocatable facilities  because OSD does not have a strategy to manage the use, disposal, and  redistribution of these facilities across all the services, including projected  costs. Our prior work has shown that management control should be  designed to provide reasonable assurance against unauthorized  acquisition, use, or disposition of an agency’s assets. One way to  accomplish this is an adequate means of communicating with and  obtaining information from stakeholders that may have an effect on the  agency achieving its goals. Collectively, OSD has a unique set of challenges  in managing its current inventory of over 4,000 relocatable facilities;  however, without a strategy that includes provisions for the disposal of  relocatable facilities, including projected costs, some relocatable facilities  could remain in place for years to come. Without a comprehensive DOD  strategy for managing relocatables—including the transfer of relocatables  from one location to another—a military service could unnecessarily  spend funds by simultaneously acquiring new facilities while another  military service is incurring costs to store or demolish similar facilities.  In addition, if this strategy does not include a consistent, common  measure for estimating disposal costs based on size of the facility, DOD  might not be planning for this expense in the most accurate and efficient  way possible.
section_title: Conclusions
paragraphs: The pace of growth at some installations is exceeding the ability of  traditional military construction to provide permanent facilities. Without a  complete and accurate accounting of how many relocatable facilities DOD  actually has or how much it spent to acquire them; DOD will continue to  have a limited ability to oversee and manage the steps the services are  taking in response to personnel growth at some installations. Until OSD  develops clear guidance for the services to follow on what it expects to  count as a relocatable facility, along with an expectation for the services  to provide a complete and accurate accounting of them, OSD and  Congress will continue to have incomplete information on the extent to  which these relocatable facilities are being used on defense installations as  interim solutions to facility infrastructure shortages. In addition, without a  mechanism to accurately record and monitor its inventory of relocatable  facilities, along with its cost to acquire them, OSD will not have reliable  data for making effective choices on funding decisions.
Similar to DOD’s experience with World War II–era wooden buildings,  which were expected to be in use no more than 5 years, but of which many  are still in use today, DOD’s use of relocatable facilities could outlast the  services’ current expectations, especially in an increasingly competitive  budget environment that could delay needed military construction funds  beyond current expectations. In addition to the cost of acquiring  relocatable facilities, DOD is likely to incur costs to store, dispose of, or  relocate them. Without a comprehensive strategy to effectively manage the  services’ use of relocatable facilities, DOD may be unprepared to reliably  budget for these costs. Finally, without a more strategic DOD-wide view of  the services’ plans to acquire and dispose of relocatable facilities, OSD  may not be in a position to coordinate or to ensure the services transfer  used relocatables from one location to another when appropriate, in lieu  of acquiring new relocatable facilities at one location needing them,  thereby avoiding waste.
section_title: Recommendations for Executive Action
paragraphs: To improve OSD’s oversight and management of the military services’ use  of relocatable facilities, we recommend that the Secretary of Defense  direct the Under Secretary of Defense for Acquisition, Technology and  Logistics to take the following three actions:    clarify its guidance on the definition of relocatable facilities;    develop a mechanism for collecting and maintaining complete and reliable  data on the number of relocatable facilities used by the military services  and on the costs of acquiring them once OSD clarifies the guidance on the  definition of relocatable facilities; and    develop and implement a strategy to help effectively manage the use,  disposal, and redistribution of relocatable facilities across all the services  when redistribution is appropriate, including projected costs.
section_title: Agency Comments and Our Evaluation
paragraphs: In written comments to a draft of this report, the Deputy Under Secretary  of Defense (Installations and Environment) fully agreed with two of our  three recommendation and stated it would take actions to implement  them. The Deputy Under Secretary partially agreed with our  recommendation that the Under Secretary of Defense for Acquisition,  Technology and Logistics develop and implement a strategy to help  effectively manage the use, disposal, and redistribution of relocatable  facilities across all the services when redistribution is appropriate,  including projected costs, citing that the Under Secretary of Defense for  Acquisition, Technology and Logistics should not be involved in  implementation but rather should promulgate policy and monitor  implementation on the use, disposal, and redistribution of relocatable  facilities across all the services when redistribution is appropriate.
In a follow-up discussion with an OSD official regarding DOD’s written  response to a draft of this report, the official noted that OSD will  promulgate policy, which includes directing the military services to  redistribute relocatable facilities across the services when redistribution is  appropriate, and will monitor implementation on the use, disposal, and  redistribution of relocatable facilities across all services when  redistribution is appropriate. As such, we believe DOD’s planned action  meets the intent of our recommendation. DOD’s comments are reprinted  in their entirety in appendix II. Also, DOD provided one technical  comment on a draft of this report, which we incorporated as appropriate.
We are sending copies of this report to interested congressional  committees; the Secretary of Defense; the Secretaries of the Army, Navy,  and 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 GAO’s Web site at http://www.gao.gov.
If you or your staff have any questions concerning this report, please  contact me on (202) 512-4523 or by e-mail at leporeb@gao.gov. Contact  points for our Offices of Congressional Relations and Public Affairs are on  the last page of this report. GAO staff who made major contributions to  this report are listed in appendix III.
section_title: Appendix I: Scope and Methodology
paragraphs: To determine the extent to which the Office of the Secretary of Defense  (OSD) is providing oversight of the military services’ use of relocatable  facilities to meet physical infrastructure needs, we reviewed Department  of Defense (DOD) guidance on the authorization, acquisition, use, and  disposition of relocatable facilities and the military services’ policies and  procedures that implement DOD’s guidance. We obtained and reviewed  inventory and cost data on relocatable facilities as reported to OSD by  each military service. Although service headquarters officials stated that  their data reflected information collected from their installations, we  found that the data were not reliable because they were not always  complete and accurate. Examples of the data reliability issues are included  in this report. To gain insight into the numbers, costs, and disposal plans  for relocatable facilities at the installation level, we visited seven defense  installations. We selected installations to visit from those identified by  service headquarters’ officials as having a sizable number of relocatable  facilities. We focused mostly on Army and Marine Corps installations  because they use relocatable facilities to a greater extent than the Navy  and the Air Force. Specifically, we visited Fort Hood and Fort Bliss in  Texas; Fort Drum in New York; Naval Amphibious Base Little Creek in  Virginia; Eglin Air Force Base in Florida; Marine Corps Base Camp Lejeune  in North Carolina; and Marine Corps Base Camp Pendleton in California.  At each installation we visited, we obtained data on the number and cost  of purchasing or leasing relocatable facilities. We compared the  installation’s inventory of relocatable facilities to the numbers the service  headquarters reported to OSD and documented and discussed any  discrepancies with installation and service headquarters officials. Our  analysis of the seven installation visits cannot be generalized to other  military installations. We also visited the Army Installation Management  Command–West in Texas to discuss the Army’s relocatable facilities.  Furthermore, we interviewed OSD and military service headquarters  officials managing relocatable facilities to discuss the primary reasons for  acquiring and using relocatable facilities, the process used to acquire  them, and plans for their disposal. The Senate committee report limited  DOD’s review by excluding nonpermanent or temporary facilities used  overseas at forward operating sites or cooperative security locations, thus  we did not include the services’ use of relocatable facilities at overseas  locations. Also, we did not include the use of trailers by construction  contractors or associated with any ongoing construction projects at  defense installations.
To determine the extent to which DOD has a comprehensive strategy for  managing relocatable facilities, we interviewed OSD and military service  officials to discuss whether they have a plan to track whether relocatable  facilities are used for time periods that exceed DOD’s or the service’s  length of use criteria, the implications of using relocatable facilities longer  than called for in the guidance, and any issues regarding the disposal of  relocatable facilities. At the installations we visited, we obtained  information on the relocatable facilities that were in use longer than called  for in DOD guidance and ascertained the reasons why. We also discussed  with installation officials their plans for replacing relocatables with  permanent buildings and the potential for costs to dispose of relocatable  facilities.
We conducted this performance audit from February 2008 to June 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: Comments from the Department of Defense
section_title: Appendix III: GAO Contact and Staff Acknowledgments
subsections: section_title: GAO Contact
section_title: Staff Acknowledgments
paragraphs: In addition to the individual named above, Laura Talbott, Assistant  Director; Leslie Bharadwaja; Susan Ditto; Mary Jo LaCasse; Katherine  Lenane; Clara Mejstrik; Charles Perdue; and Sharon Reid made key  contributions to this report.