Afghanistan: Embassy Construction Cost and Schedule Have Increased, and Further Facilities Planning Is Needed
Released: 2015-05-19T00:00:00


Highlights: section_title: Why GAO Did This Study
paragraphs: Since re-opening in 2002, the U.S. embassy in Kabul, Afghanistan, has experienced a dramatic increase in staffing, followed by a gradual drawdown. State has invested or plans to invest a total of $2.17 billion in U.S. facilities to address current and projected space needs. State awarded two contracts in 2009 and 2010 to construct additional on-compound housing and office facilities. State partially terminated one contract for the convenience of the U.S. government, and expanded the construction requirements of the second, affecting cost and schedule. State's Bureau of Overseas Building Operations is responsible for the planning, design, and construction of U.S. embassies. This report updates and expands upon GAO's previous work.

This report examines (1) the extent to which construction cost and schedule have changed and why, (2) State's use of temporary facilities on-compound, and (3) State's planning for projected embassy facility needs. GAO evaluated construction planning and contract documents and interviewed State and contractor officials in Washington, D.C., and Kabul.

section_title: What GAO Found
paragraphs: Cost and schedule have increased for the Kabul embassy construction project, in part due to incomplete cost and risk assessment. Cost for the 2009 and 2010 contracts has increased by about 27 percent, from $625.4 million to $792.9 million, and is likely to increase further. Projected completion has been delayed over 3 years to fall 2017. The Department of State (State) did not follow its cost containment and risk assessment policies, resulting in lost opportunities to mitigate risks. These risks, such as delays in the sequencing of the two contracts, eventually materialized, increasing cost and extending schedule. Unless State follows its policy, it may be unable to avoid or mitigate risks to cost and schedule on future projects.

Architect's Rendering of Embassy Compound upon Project Completion

Since 2002, State has built over $100 million in temporary buildings (intended for no more than 5 years' use) to meet space needs on-compound but has no security standards tailored to those facilities. On completing the project in 2017, all temporary facilities will be 5 to 10 years old, and their continued use is likely. Without security standards or other guidance to guide temporary facility construction in conflict environments, State inconsistently applied alternative security measures that resulted in insufficient and different levels of security for temporary offices and housing, as well as increased cost and extended schedules. Without temporary facility security standards or guidance, future construction in conflict environments could encounter similar problems.

State's lack of a strategic facilities plan and policies governing such planning has led to coordination challenges in addressing the embassy's future facility needs. Industry standards cite the value of plans that comprehensively assess existing facilities, identify needs, and document decisions on meeting those needs. In Kabul, however, State constructed a guard facility without proper design review or applying for a building permit, leading to fire safety deficiencies that State corrected at extra cost. Finally, State formally assigns responsibility for strategic facilities planning but lacks policy that governs implementation of such planning. State intends to make additional facility investments to address future facility needs. Without a strategic facilities plan and policy to guide its development, coordination to address these needs will continue to be difficult.

section_title: What GAO Recommends
paragraphs: GAO recommends that State (1) adhere to its cost containment and risk assessment policies, (2) consider establishing security standards or guidance for temporary buildings in conflict zones, (3) develop a strategic facilities plan for Kabul, and (4) clarify its strategic facilities and master planning policy. State concurred with the first, third, and fourth recommendations and partially concurred with the second.

section_title: Letter
paragraphs: Since re-opening in 2002, the U.S. embassy in Kabul, Afghanistan, has  experienced a dramatic increase in staffing, followed by a gradual  drawdown. During that time, the Department of State (State) has invested  or plans to invest a total of $2.17 billion in its facilities in Kabul to address  current and projected space needs in a difficult environment that has  experienced constantly evolving security threats. As part of this effort,  State awarded two contracts in 2009 and 2010, totaling $625.4 million, to  construct additional housing and office facilities on the embassy  compound. Subsequently, State partially terminated one contract for the  convenience of the U.S. government, and expanded the construction  requirements of the second contract, which increased cost and extended  schedule. This report updates and expands on our previous work.

We performed our work under the authority of the Comptroller General to  conduct evaluations on GAO’s initiative because of broad congressional  interest in the oversight and accountability of U.S. funds used in  Afghanistan. We reviewed (1) the extent to which construction cost and  schedule have changed and why, (2) State’s use of temporary facilities  on-compound, and (3) State’s planning for projected embassy facility  needs.

To conduct this review, we obtained information from agency planning,  funding, and reporting documents and interviewed officials from State’s  Bureau of Overseas Building Operations (OBO); Bureau of Diplomatic  Security (DS); Office of Acquisitions Management; Bureau of South and  Central Asian Affairs (SCA); Office of the Special Representative for  Afghanistan and Pakistan (SRAP); and Office of Management Policy,  Rightsizing, and Innovation. Within OBO, we met with officials from  Construction Management, Design and Engineering, Master Planning and  Evaluations, Project Development and Coordination, Real Property  Leasing, Security Management, Strategic Planning, and Financial  Management. Within DS, we met with officials from High Threat  Programs, Overseas Protective Operations, and Physical Security  Programs.

In February 2014, we traveled to Kabul, Afghanistan, to observe  construction progress and meet with U.S. embassy officials responsible  for construction, facilities management, post management, and security.  We also met with contractor officials in Kabul and in the United States. In  addition, our Kabul Field Office conducted follow-up meetings with  officials in Kabul and their successors through December 2014. We  incorporated audit work from our February trip and relevant material  gathered for our July 2014 report into this audit. In addition, we obtained  State funding information on all such projects over $1 million in Kabul. We  determined that these funding data were sufficiently reliable for the  purposes of this report. For more details on our scope and methodology,  see appendix I.

We conducted this performance audit from July 2014 to May 2015 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.
subsections: section_title: Background
subsections: section_title: State Bureaus Involved in Embassy Construction
paragraphs: OBO is responsible for the acquisition, design, construction,  maintenance, utilization, and sale of U.S. government diplomatic property  abroad. Through its Capital Security Construction Program, administered  by OBO, State replaces and constructs diplomatic facilities to provide  U.S. embassies and consulates with safe, secure, functional, and modern  buildings. According to State, from fiscal years 2009 through 2014, State  awarded contracts and completed construction of nine new embassy or  new consulate compounds world-wide. In addition, during this period  State completed 26 other embassy or new consulate compounds and  also awarded contracts for 25 new embassy or new consulate  compounds that are in design or construction. OBO is responsible for  ensuring that such diplomatic compound construction meets specific  building codes and standards.State bureaus, or U.S. agencies undertake diplomatic construction  abroad, OBO provides direction and guidance to include reviewing  designs, issuing building permits, and conducting inspections to ensure  its standards are met.

In cases where overseas posts, other  DS is responsible for, among other things, establishing and operating  security and protective procedures at posts, developing and implementing  posts’ physical security programs, and chairing the interagency process  that sets security standards. Accordingly, DS is responsible for ensuring  that new embassy construction meets security standards. In addition, at  posts, DS regional security officers are responsible for protecting  personnel and property, documenting threats and facility vulnerabilities,  and identifying ways to mitigate those vulnerabilities. DS can also use its  Worldwide Protective Services contract to address such vulnerabilities by  establishing contractor-provided personal protection, guard, and support  services at posts. In the case of Afghanistan, DS has used this contract to  undertake some security-related construction, such as constructing  physical security walls and guard housing. However, such construction is  contingent upon relevant OBO design reviews and permitting to ensure  that building codes are met.

SCA is responsible for coordinating foreign policy related to countries in   In that capacity, SCA guides the  the region, including Afghanistan.operation of U.S. diplomatic missions—embassies and consulates,  including Kabul—within those countries. SCA also serves as the  headquarters liaison, on behalf of its assigned posts, with other State  bureaus, such as OBO and DS.

section_title: On-Compound Construction
paragraphs: From 2002 through 2009, State took several actions to expand the U.S.  embassy compound in Kabul. Initially, OBO refurbished an existing office  building, built in the 1960s. OBO also constructed a new chancery office  building, staff apartments, and support facilities. Additionally, OBO  constructed temporary offices and housing for the U.S. Agency for  International Development (USAID). As staffing increases outpaced  available space, the embassy acquired hundreds of modified shipping  containers for temporary housing and also compressed office space by  adding more desks in the new chancery and the existing office building.

In fiscal years 2009 and 2010, State awarded two contracts originally  worth $625.4 million in total to meet growing facility requirements at the  U.S. embassy in Kabul. The first contract, awarded to Contractor 1 in September 2009 for $209.4 million, was for the design and construction of  temporary and permanent structures to include office annex A, apartment building 1, cafeteria and recreation center, perimeter security and compound access facilities, warehouse addition, and utility building.  temporary offices and housing,  The second contract, awarded to Contractor 2 in September 2010 for  $416 million, was for the design and construction of: office annex B, apartment buildings 2 and 3, expansion of existing apartment building 4, compound access and perimeter security facilities, and parking facilities—to include a vehicle maintenance facility.

State’s plans called for sequencing construction under the two contracts  and demolishing older temporary facilities to make space available for  new facilities. State’s plans also entailed acquiring the Afghan Ministry of  Public Health site adjacent to the compound to build parking facilities for  approximately 400 embassy vehicles. In September 2011, after the U.S.  and Afghan governments did not reach agreement to transfer that site,  State had to remove the parking and vehicle maintenance facilities from  the project.

In September 2011, State partially terminated elements of the first  contract—specifically the permanent facilities, including office annex A  and apartment building 1—for the convenience of the U.S. government, in  part, due to concerns about contractor performance and schedule delays.  Contractor 1 completed the temporary offices and housing units, but in  September 2011, State transferred contract requirements for the  permanent facilities not begun by Contractor 1 to Contractor 2’s contract.

The U.S. embassy compound in Kabul comprises the east and west  compounds separated by Great Massoud Road, as well as a 6.17-acre  site (or “6.17 site”) connected to the east compound. Our July 2014 report  provides further information on the construction phasing of the current  project.

Once the current construction is completed, the Kabul embassy’s  permanent facilities—both older and newly constructed office and  apartment buildings—will contain 1,487 desks and 819 beds. Those totals  do not include the desks or beds in temporary offices and housing  facilities, which we discuss later in the report. Figure 1 depicts the  planned configuration of the compound upon completion of current  construction.

section_title: Off-Compound Construction
paragraphs: State has also acquired other real property off-compound. Major off- compound properties include Camp Sullivan, a 20.9-acre property located  near Kabul International Airport; Camp Seitz, a 7-acre facility southwest  of the embassy that serves as housing and office space for security  contractors; and Camp Eggers, a 16.8-acre former Department of  Defense (DOD) facility southwest of the embassy planned to serve as a  contractor camp. The relative locations of some of these properties are  shown in figure 2. In addition, State is upgrading Camp Alvarado, a  property located near the airport that serves as the main aviation hub for  the embassy’s air transport and counternarcotics operations.

section_title: Total Kabul Infrastructure Investments
paragraphs: State’s past and planned capital construction investments in Kabul from  2002 through March 2015 total $2.17 billion in project funding, which  includes awarded construction contracts and other costs State incurs that  are not part of those contracts. Examples of other State project costs  include federal project supervision, construction security, security  equipment, and project contingencies. Figure 3 shows these  investments.

In the case of the current Kabul embassy expansion, as of March 2015,  State has allocated $1.11 billion to cover the 2009 and 2010 contract  costs as well as State’s project costs outside the two contracts. The  original cost of the 2009 and 2010 construction contracts was $625.4  million. When we discuss increased costs in this report, we are referring  to those costs agreed to between State and its construction contractors  for the 2009 and 2010 contracts.

section_title: Contract Costs Have Risen and Schedule Has Been Extended Following State’s Incomplete Risk Assessment; Further Cost Increases Are Likely
paragraphs: The costs for the 2009 and 2010 contracts are now almost 27 percent  higher than the original contract costs. The completed project will be  delivered just over 3 years later than originally planned. State did not  follow its cost containment and risk mitigation procedures, a fact that  likely contributed, in part, to increased cost and extended schedules.
subsections: section_title: Contract Costs Have Increased by $167.5 Million or about 27 Percent
paragraphs: As of March 2015, the 2009 and 2010 contracts have a combined total  cost of $792.9 million, which represents an increase of $167.5 million, or  almost 27 percent, since contract award. At award, the 2009 and 2010  contracts were worth $209.4 million and $416 million, respectively, for a  total of $625.4 million. In September 2011, State partially terminated the  2009 contract for the convenience of the government due to concerns, in  part, about performance and schedule delays and reduced the contract  value by $121.4 million. Two weeks later, State issued the first  modification of the 2010 contract, shifting the permanent facilities from the  2009 contract and modifying some of the planned work, adding $222.5  million to that contract. Subsequent contract modifications added almost  $66.5 million to the total contract value, bringing the total value of the  2010 contract to $705.5 million. The additional work included  reconfiguring the existing office building’s second floor, upgrading the security measures on temporary housing, upgrading embassy perimeter walls, improving life safety measures on apartments 2 and 3, and  shipping some building materials by air to avoid problematic ground  shipments through Pakistan.

See table 1 for a summary of cost increases and decreases for the two  contracts.

section_title: Cost to Complete Contract Likely to Increase
paragraphs: As of March 2015, OBO and Contractor 2 were still negotiating the value  of several contract changes that will likely result in increased costs. The  changes being discussed include but are not limited to the following  matters:  the contractor’s assertion that site areas were not available to start  construction as planned, upgrades to the compound’s electrical distribution systems, modifications to alter the height of apartments 2 and 3, and the addition of new work inside the 2006 chancery.  costs to address design issues related to 2009 permanent facilities,  changes to enhance some physical security measures,  As of March 2015, State has allocated $1.11 billion to the project to cover  the 2009 and 2010 contract costs as well as State’s project costs outside  the two contracts. This figure represents originally allocated funding plus  subsequent transfers from other State accounts. For example, in  September 2014, State transferred, with congressional support, $40  million in funding to cover costs due to shipping disruptions and  anticipated construction contingency shortfalls. Additionally, State has  notified Congress of its intent to use $25 million of funds State had  transferred in 2014 to cover project supervision and further replenish the  project’s contingency funding. State reported that without the additional  $25 million, it would be forced to stop the project in mid-2015 because of  a lack of funds.

section_title: Construction Schedule Has Been Extended by Over 3 Years
paragraphs: According to State documents, State had originally planned to complete  the entire Kabul construction project by summer 2014. State now  estimates completion by fall 2017, although the 2010 contract has not yet  been revised to reflect that date. Table 2 shows current estimated  delivery dates for key buildings, compared with the estimated delivery  dates in OBO’s original plan.

Figures 4 through 6 show ongoing construction of office annexes A and B  as well as apartment building 1 as of December 2014. Construction of  apartments 2 and 3 has not yet begun.

section_title: State Did Not Follow Policy on Required Cost Containment and Risk Assessment Studies, a Fact That Likely Led, in Part, to Increased Costs and Extended Schedules
paragraphs: The U.S. Office of Management and Budget (OMB) and State both  require cost containment studies for certain construction projects. Also,  State requires OBO to assess risks posed to its construction projects.  However, State did not properly follow these cost containment and risk  assessment policies, a fact that likely contributed to increased costs and  extended schedules in the 2009 and 2010 contracts.
subsections: section_title: State Procedures Require Cost Containment and Risk Assessment Studies
paragraphs: OMB policy requires federal agencies to use value engineering (referred  to as cost containment in this report) as a management tool to ensure  realistic budgets, control capital and operating costs, and improve and  maintain acceptable quality in program and acquisition functions (e.g., in  a construction project). The policy indicates that the value of cost  containment is likely to be greatest when applied to the highest dollar  value programs during the feasibility, planning, design, and other early  phases of development and can also help to reduce overall risk. State  implements this policy by requiring OBO to conduct two cost containment  studies for each project costing more than $20 million: one study during  the planning of the project and one study no later than the design  review. OBO guidance requires the study team leader to formally record  the disposition of cost containment study recommendations, identifying  which will be implemented and providing a defensible rationale for  rejecting other recommendations.

In addition, OBO’s standard operating procedures require risk  assessment studies to reduce risks through identification and  assessment, mitigation, and contingency planning. The procedures  state that risk assessment is a necessary and prudent management  task. Risk assessments should be conducted (1) early in the project  planning phase (as input and guidance for initial planning), (2) again  when developing budget estimates, and (3) again when developing cost  estimates in support of negotiating and awarding a contract. Risks are  also to be tracked during project implementation. After a risk assessment  has been conducted, results should be conveyed to project stakeholders  through a report and, if needed, a risk mitigation plan that outlines how  the organization plans to take action to mitigate risks from occurring, or  how it will respond to identified risks should they occur.

section_title: State Did Not Follow Its Cost Containment and Risk Assessment Policies for Either Contract
paragraphs: State awarded the 2009 and 2010 contracts for construction in Kabul  without following its procedures for cost containment studies and risk  assessments. Between the 2009 contract and the 2010 contract, State  should have conducted four cost containment studies and six risk  assessments. However, for the 2009 contract, State confirmed that it did  not conduct either type of assessment. Because of the value of the 2009  contract, $209.4 million, two separate cost containment studies would  have been required. Also, no risk assessments were performed and no  risk mitigation plan was developed.

State completed only one required cost containment study for the second  contract and combined it with a risk assessment. The study was  conducted by an outside firm in March 2010 on the conceptual design for  the 2010 contract, which was planned for award in September 2010; that  is, the study occurred while OBO was drafting State’s request for  proposals for the 2010 contract. The objective of the study was to  evaluate the project from the perspective of performance, cost, schedule,  and risk and to identify viable alternative concepts to enhance the project.  OBO’s consultant for this effort focused primarily on phasing construction,  planning risk response, and improving the project’s long-term flexibility.  Because of the accelerated nature of the project, the study did not focus  on the programmatic elements (e.g., staffing, floor plan, and site layout).

DS officials were not sufficiently involved in the cost containment study,  contrary to established policy. OBO policy on cost containment requires  the OBO value engineering manager and the project team leader to  request and coordinate review of the consultant’s recommendations with  technical team members and all interested offices to determine whether  to accept, reject, or modify those recommendations. DS is cited in the  policy as an interested office. According to attendee lists, no one from DS  participated in the meetings related to the study, and DS officials we  spoke with indicated they were not aware of the study and its security  recommendations.

The cost containment study made 31 recommendations to State to  streamline construction and improve the safety and efficiency of the  buildings. State provided us with a table summarizing the cost  containment alternatives and indicating that State accepted 18, rejected  12, and partially accepted one. According to State, seven of the  accepted recommendations were included in the request for proposals  then being drafted. We did not assess the implementation of the  recommendations. State’s policy states that cost containment disposition  memos should include defensible rationale as to why a recommendation  was rejected. The explanations for rejecting the twelve were brief. For  eleven of the twelve rejected recommendations, State provided no further  documentation for rejecting the proposals other than a preliminary and a  final summary paper. Further, it was unclear from State’s documentation  memo what construction and operating life-cycle cost savings OBO  expected to achieve in relation to the consultant’s estimates and  recommendations.

The risk assessment identified over 30 risks to the project. In particular, it  identified the interface between the 2009 and 2010 contracts as a major  source of risk. Specifically, the study raised concerns about how State  could best coordinate the 2010 contract with the 2009 contract without  sufficient information about Contractor 1’s design plans, which were still  under development. The study noted that effects could be severe for  apartment buildings 2 and 3 in the 2010 contract if progress on the 2009  contract was delayed. Other major risks included the following:

The 2009 contract might not provide adequate site utilities for the  facilities in the 2010 contract, as the 2009 design was still under  development.

Site areas that State planned to acquire—such as the adjacent  Afghan Ministries of Public Health and Defense sites—might not be  available in time, or at all, to enable construction to proceed as  planned.

There might be insufficient space for two contractors to stage  construction concurrently.

On-going physical security threats in a conflict environment.

The consultant recommended key risk mitigation actions, which State did  not act on, that aligned with the recommendations for cost containment  strategies related to the two contracts:

Facilitate greater project coordination between the 2009 contract and  planned 2010 contract; the consultant recognized that implementing  the recommendation might require delaying the 2010 contract award  to 2011.

Divide the 2010 contract into two separate contracts to effectively  defer award of apartments 2 and 3 so that if the 2009 contract was  delayed, the 2010 contract would not also be delayed due to the tight  sequencing of construction.

One State project official indicated that, given concerns about security in  Kabul and pressure to get permanent, hardened facilities built as soon as  possible, State was not going to act on any recommendation that would  delay getting the contracts awarded and the facilities built. Further, a  senior State management official acknowledged that State did not fully  follow its cost and risk policies, in part because of the urgency of the  embassy’s facility needs, the security environment, and challenges in  supporting the surge in embassy staffing that was occurring.to this official, had the cost containment and risk assessment study  recommendations been more fully considered by senior management,  there might have been a decision to delay award of the 2010 contract,  which would have slowed efforts to provide facilities as quickly as  possible. He also noted that budget pressures existed to get funding  committed, contracts awarded, and projects started. He stated that OBO  as an organization did the best it could, given the challenging  circumstances. As noted in our July 2014 report, several risks eventually  materialized, such as the loss of the Afghan Ministry of Health site and  insufficient space that interfered with the sequencing of construction.  These factors contributed to increased construction cost and extended  schedule.

section_title: State to Continue Use of Temporary Facilities but Lacks Specific Security Standards for Them, Contributing to Increased Costs and Extended Schedules
paragraphs: Since 2002, State has spent over $100 million to construct temporary  facilities on-compound in Kabul, and the post will likely continue to use  some of those temporary facilities. Prior to building additional temporary  facilities on the east compound, State informed Congress of its concerns  about threats posed from incoming weapons fire and indicated that  overhead protection was required to protect staff in existing temporary  facilities on compound.  However, while State has security standards for  its facilities, it does not have security standards specifically tailored to  temporary facility construction. As a result, State inconsistently applied  alternative security measures that were insufficient and differed for  temporary offices and housing. State subsequently took corrective action  through contract modifications that increased the project cost and  extended the schedule of the overall construction project.
subsections: section_title: Use of Temporary Facilities to Meet Interim Space Needs Expected to Continue Indefinitely
paragraphs: Since 2002, State has spent over $100 million to construct temporary  facilities on the embassy compound to accommodate evolving staffing  needs and provide temporary office and housing space as permanent  facilities are built. As of February 2015, temporary facilities on the  embassy compound provided nearly 1,100 desks and 760 beds.

OBO building guidance from 2009 states that “temporary facilities” are  facilities that will be occupied for no more than 5 years or until a  permanent building is constructed, whichever is sooner. The guidance  also indicates that temporary facilities include, but are not limited to,  containerized housing/office units, modular units, modified shipping  containers, and trailers.

Most of the embassy’s temporary facilities are located on the east  compound. Some of the earliest temporary facilities were built to provide  office and housing space for USAID and are more than 10 years old.

More recent temporary office and housing facilities were built in 2011—as  part of the current embassy construction—to accommodate the staffing  surge that began in 2009 and to provide temporary space while  permanent facilities were constructed. Those temporary facilities were  built under the 2009 contract. Additionally, in 2013, State constructed  additional temporary housing—built by Contractor 2—on the 6.17 site.  Figure 7 shows some of the temporary facilities that the post has used to  meet interim space needs.

State intends to demolish the older USAID temporary offices and some  temporary housing built in 2011 on the east compound to build permanent  apartment buildings 2 and 3. According to OBO officials, State has not  finalized which temporary housing facilities will be demolished and which  will remain. As a result, 5 two-story temporary office buildings and an  estimated 12 to 17 multiunit temporary housing structures will likely  remain at the completion of the current project.

While State has not made a final determination on which temporary  facilities will be demolished or repurposed for other functions (such as for  use by support service contractors), consist of over a third of available desks and beds on-compound after  current construction is completed in fall 2017.

Temporary office facilities that are to remain can provide space for  875 desks. By comparison, permanent office facilities (existing and  newly constructed) in fall 2017 will provide 1,487 desks. That is,  temporary offices will continue to provide 37 percent of the 2,362  available desks on-compound in fall 2017.

The number of temporary housing facilities that are to remain has not  been finalized. The number of beds that are likely to remain within the  temporary housing facilities will range from approximately 472 (if 12  housing facilities remain) to 640 beds (if 17 housing facilities remain.)  Given this range, and the 819 permanent beds to be provided within  permanent apartment facilities (existing and newly constructed) upon  construction completion, temporary housing will continue to provide  between 37 and 44 percent of the available beds on-compound.

State officials report that some of the existing temporary offices may be converted to  temporary housing space so that State can rehabilitate and upgrade existing staff  apartment buildings in the future.

Table 3 summarizes the numbers of desks and beds located in temporary  and permanent facilities as of February 2015 and those likely to remain  upon completion of the current construction project, currently estimated  for fall 2017.

State planning documents, as well as post and OBO officials, identify a  continued need for some of the temporary facilities following completion  of the permanent facilities in 2017. At that time, all temporary facilities on- compound will be nearly 5 years old or more, and a smaller subset on the  west compound will be more than 10 years old. State officials indicated  some may be used by State contractors that will provide support services  following the U.S. military’s drawdown. Some facilities could also be used  to relocate some of the Kabul Embassy Security Guard Force functions  onto the compound. Further, State plans to invest at least $124 million in  further investments in some of the east compound temporary facilities  that are to remain.

Some of those additional investments would correct  what State reports as deficiencies in the temporary facilities and provide  upgrades to electrical, sewer, and water systems.

section_title: Lack of Security Standards for Temporary Facilities Contributed to Insufficient and Differing Levels of Protection, Increased Costs, and Extended Schedule
subsections: section_title: State Lacks Security Standards for Temporary Facilities and Applied Insufficient and Differing Security Measures
paragraphs: State has recognized the need for an established level of security  protection for temporary facilities. When State requested funding to  construct apartment building 1 in its fiscal year 2008 Supplemental  Appropriations Justification, it reported to Congress that while some  employees enjoyed the benefit of 146 permanent, hardened apartments,  all other employees lived in temporary housing facilities. The 2008  justification also communicated State’s concerns about threats posed to  temporary facilities from potential incoming weapons fire—amid  increasing attacks around Kabul by the Taliban and al-Qaeda—and  indicated that overhead protection was required to protect staff in the  existing temporary facilities on-compound, such as the USAID temporary  offices. State reiterated its concerns about the security of Kabul  temporary facilities and threats posed to those facilities in its fiscal year  2009 Congressional Budget Justification when it requested additional  funding for the current project. Also, State security standards in 2009  indicated physical housing constructed as an integral part of or adjoining  the chancery (i.e., office building) should be constructed to meet chancery  physical security standards.measures include features such as forced entry protection and ballistic  resistance.

Examples of some physical security  However, according to DS officials, State does not have a set of minimum  security standards specifically for temporary facilities it constructs. State  has physical security standards governing construction of offices and  housing that State seeks to meet regardless of whether a facility is  permanent or temporary. For practical purposes, DS officials stated that  State’s physical security standards governing new construction— regardless of whether a facility is permanent or temporary—are standards  that only permanent construction can meet. temporary facilities—unlike newly constructed permanent facilities— cannot be constructed to meet all State’s security standards, State has  the discretion to grant exceptions from those standards. To the extent  that security criteria cannot be met, mitigating solutions (i.e., alternative  security measures) must be developed in writing and approved by DS in  advance of constructing new facilities.

Temporary facilities cannot meet State security standards because the construction  materials and methods used in building a temporary facility are different from those used  in building a permanent facility. For example, wood or metal wall systems may be used— rather than concrete—in constructing temporary facility structures.

In the absence of minimal security standards (or guidance) to guide  planning for temporary facility construction, State inconsistently applied  alternative security measures, resulting in insufficient and different levels  of security between temporary offices and housing. When awarding the  2009 contract, State did not specify that overhead protection was required  for either the temporary housing or temporary offices, even though State  had previously expressed to Congress concerns about the threat posed  from incoming weapons fire in its fiscal year 2008 justification. The only  security protection measure specified in the 2009 contract for the  temporary housing was shatter-resistant window film. By comparison,  State specified temporary offices were to receive forced entry and ballistic  protection. DS officials we spoke with indicated that staff living on- compound should receive the same level of protection in their housing as  in their offices.

OBO and DS did not finalize the security measures for the temporary  facilities before State’s award of the 2009 contract, contributing to cost  increases and schedule extensions. In December 2009—3 months after  award of the September 2009 construction contract—the two bureaus  were still seeking to reach agreement on the security measures for  temporary facilities. At that time, in a memorandum to OBO, DS stated  that the physical security requirements for the new temporary facilities  should comply with State’s physical security standards to as great an  extent as feasible and that the temporary facilities should be designed  and constructed to provide forced entry and ballistic protection as  required for any other new construction.

section_title: Actions to Correct Security Disparities Increased Costs and Extended Schedules
paragraphs: After awarding the 2009 contract, State had to modify contract  requirements to address the insufficient and different security  requirements for the temporary housing and offices, which added cost  and extended the project schedule to address this disparity. State likely  paid more than it would have had the security requirements been  included in the original contract requirements. This is, in part, because  this work was not subject to competition, as was the original contract,  which can drive down price.contract to address additional security requirements led to increased cost  and stated that conducting such work after the fact was difficult in limited  space on an active compound.

State officials agreed that modifying the  State modified the 2009 contract in December 2009 to provide some  overhead protection for all temporary offices and housing. Those changes  contributed, in part, to the increased costs and extended schedule of the  2009 contract.  In 2013, State further modified the 2010 contract, at a  cost of $8.2 million, to develop a design to provide additional security  protective measures for the temporary housing that had been constructed  as part of the 2009 contract.sidewall barriers to increase the physical security protection of the  temporary housing and to be more consistent with protection afforded the  temporary offices.

DS also has installed some concrete  Several DS and OBO officials reported that State needs documented  minimal security standards for temporary facilities in a conflict  environment, and some of those officials identified “expeditionary”  standards used by DOD as an example of such standards. OBO  officials also commented that State only undertook the building of  temporary expeditionary structures on a large scale beginning in 2010.  One OBO facility engineer indicated State should study its experience  managing construction in conflict environments and apply lessons learned  based on experience in locations such as Afghanistan and Iraq. One  OBO security engineer indicated that State would have been better able  to address the temporary facility security needs in Kabul if State had had  clearer standards (or guidance) for construction of such facilities. In  addition, some DS management officials and project staff indicated that  while State needs minimal standards to guide the construction of  temporary facilities, State would still need to tailor physical security  measures—such as increasing security wall heights or installing guard  towers and bunkers—to specific site threats and as new threats evolve.  Some DS officials we spoke with indicated that State could examine  DOD’s building design criteria for temporary facilities and standardized  designs for such facilities—in addition to examining DOD’s minimum  security standards—as a possible model for improving delivery of such  facilities.have been both security and design challenges in constructing temporary  facilities in Kabul—as well as elsewhere—and opportunities to learn from  those challenges and the need for making any changes to standards or  developing guidance could be examined by State’s security standards  committee.

section_title: State Has Taken Some Actions to Improve Future Delivery of Temporary Facilities
paragraphs: State has taken some actions that may help avoid some of the problems  it encountered in constructing temporary facilities on-compound. In 2011,  State awarded task order contracts to multiple firms to design and provide  State with temporary, modular, containerized housing and office units  (though not hardened) when tasked. This may help reduce the time it  takes—from a contracting perspective—to procure such temporary  facilities in the future.

In 2012, State also worked with the U.S. Army to develop a conceptual,  standardized design for a Hardened Alternative Trailer System (hardened  trailers) that a DS official stated provides an improved level of physical  security protection, although not the level required for a conflict location  such as Kabul, where rockets and mortars pose threats. According to DS  officials, hardened trailers could be required as part of State’s  containerized housing and office unit task orders. One State official  identified a commercial off-the-shelf, modular protective trailer that State  could consider using. One OBO official indicated this off-the-shelf solution  is used by at least one U.S. ally in Afghanistan. According to product  information provided by this official, it can provide protection against  rockets and mortars.

State officials stated that the challenges in constructing temporary  facilities in environments such as Kabul have led DS and OBO to work  together to explore physical security measure “solutions”—such as  overhead protective cover and sidewall systems—that could provide more  consistency in future temporary construction. They further said that these  solutions would also allow other security measures—such as increasing  the heights of perimeter walls or providing bunkers—to be tailored to site  needs and threats. According to these officials, the temporary housing  constructed in 2013 on the 6.17 site reflects some improvements State  has made in constructing temporary facilities in conflict environments and  could inform the development of minimal standards, guidance, or  procedures to inform planning and construction of temporary facilities in  the future.

section_title: Lack of Strategic Facilities Planning and Policy Has Led to Coordination Challenges in Addressing Future Needs in Kabul
paragraphs: State officials indicate that additional capital construction investments are  needed to address interim and future facility needs of the U.S. embassy  in Kabul, both on- and off-compound. State stakeholders in Washington  and at the post are working to identify, prioritize, and address the post’s  facility needs through various coordination meetings and working groups.  However, this effort lacks a strategic facilities planning approach, as  recommended by industry standards. Without such a plan, projects may  have been addressed inefficiently. Additionally, while OBO formally  assigns responsibility for post-specific strategic facilities planning, OBO  lacks a policy governing implementation of such planning. Without a  strategic facilities plan for the embassy—supported by a policy to guide  its development, content, and approval—future progress in meeting the  embassy’s facility needs will likely continue to be difficult in a location that  is already challenging.
subsections: section_title: Further Construction and Funding Needed to Address Unmet Post Facility Needs
paragraphs: State has made or plans to make approximately $2.17 billion in  infrastructure investments in Kabul. Since the embassy reopened in 2002,  the dynamic and unpredictable operating environment of Afghanistan has  produced changing facility needs that have continually outpaced existing  capabilities at the post. This has been due to various factors such as  policy and program changes, staffing fluctuations, and changes in the  security environment. During this time, the post has used a variety of off- compound facilities to meet some needs that could not be met on- compound. Key facilities include Camps Alvarado, Eggers, Seitz, and  Sullivan, which, as of March 2015, represent a total State investment of  almost $731.4 million. In addition, State plans to use $394.9 million from  its Embassy Security, Construction, and Maintenance account for  additional construction to address other unmet post facility needs in fiscal  year 2015, the majority of which would be used to fund facility upgrades  at Camp Alvarado. State is also seeking at least $124 million in fiscal  year 2016 for further facility investments, such as upgrading the  remaining temporary housing. State is also planning for further potential  investments in 2017, such as constructing the parking facilities that State  had to remove from the current construction project.

The post’s current facility needs stem primarily from changing  circumstances inherent to the dynamic operating environment in  Afghanistan. For example, when the Afghan Ministry of Public Health site  became unavailable for construction in spring 2011, OBO was forced to  remove the parking garage, motor pool office, vehicle maintenance  facility, and fuel point from the current project. Although the post has a  temporary vehicle maintenance facility and fuel point on-compound, it is  located where apartment buildings 2 and 3 will be built and must be  demolished. State has explored interim solutions to provide a temporary  vehicle maintenance facility at several off-compound sites, but a  permanent location for the vehicle maintenance facility and other needed  motor pool facilities has yet to be identified.

Changes in the security environment in Kabul have also affected post  needs. For example, changing security threats, including attacks against  the compound in September 2011, led DS to request several compound  security upgrades that as of March 2015 were still being finalized. In  addition, security concerns were a primary factor in DS and the post’s  acquisition of the Camp Seitz and Camp Eggers properties, as this would  allow the relocation of both the Kabul Embassy Guard Force and the  Protective Security Detail (movement protection) Guard forces to sites  closer to the embassy.

The withdrawal of the U.S. military from Afghanistan has also produced  new needs for the post, as certain support services formerly provided by  DOD are eliminated. For example, this has driven recent post requests for  a medical trauma facility and helicopter landing zone, as well as past and  future planned upgrades at Camp Alvarado, the post’s air transport hub.  In addition, as of March 2015, State continued to develop its Afghanistan  Life Support Services (ALiSS) contract, with which it intends to replace  support services such as food, water, fuel, medical, fire protection, and  miscellaneous support services previously provided by DOD. This  transition will also require further utility and infrastructure upgrades on- compound.

According to State officials, this transition also presents a housing  challenge on- and off-compound, depending upon the size of the DOD  Office of Security Cooperation to be housed on-compound, as well as the  potential ALiSS contractor footprint in Kabul. This problem will be  exacerbated when some of the temporary housing on the east compound  is demolished to make way for apartment buildings 2 and 3. State  facilities and management officials at the post noted that the future needs  of the embassy will likely exceed the available space on-compound and  will require prioritization of needs as well as high-level policy and  management decisions on staffing presence.

State stakeholders in Washington and at the post are working to identify,  prioritize, and address these facility needs through various coordination  meetings and working groups. For example, according to State officials,  representatives from the post, DS, OBO, Office of the Under Secretary for  Management, SCA, SRAP, Bureau of Budget and Planning, Office of  Medical Services, and Office of the Legal Adviser meet weekly via video  teleconference to discuss the status of all ongoing construction projects in  Kabul. There are various working groups for specific issues, such as the  medical working group, which meets monthly. According to State officials,  DS and OBO have begun a regular meeting on DS-specific projects in  Kabul. There are two weekly management calls with the post to review  progress and a bi-weekly meeting with DOD to discuss the future DOD  Security Cooperation Office on-compound. Construction issues are also  discussed at a weekly executive steering group meeting.

section_title: Lack of a Strategic Facilities Plan Impedes Efforts to Coordinate Construction in Kabul
subsections: section_title: State Lacks a Strategic Facilities Plan in Kabul
paragraphs: State does not have a strategic facilities plan for Kabul that documents  current and future embassy needs, comprehensively outlines existing  facilities, analyzes gaps, provides projected costs, and documents  decisions made. Lack of such a plan has inhibited coordination and  undermined the continuity necessary to address emergent needs at the  Kabul embassy.

International Facility Management Association (IFMA), GAO, and OMB  guidance recommend that an organization view all real property asset  investments as a single portfolio with strategic linkages when determining  the right mix of projects to undertake. IFMA describes a strategic facility  plan as a 2- to 5-year facilities plan encompassing an entire portfolio of  owned and/or leased properties that sets strategic facility goals based on  the organization’s strategic objectives. It contains a needs statement (i.e.,  mission need), analysis of all real property assets and their condition  (owned and leased), analysis of gaps between needs and current asset  capabilities, recommendations for new spaces or buildings, and facility  cost projections. IFMA also indicates the plan should document findings  to include expected timelines for implementation but allow flexibility for  updates, as appropriate. Similarly, GAO and OMB capital planning  guidance emphasize the importance of identifying current capabilities of  real property assets, determining gaps between current assets and  needed capabilities, deciding how best to meet the gap by identifying and  evaluating alternative approaches, documenting decisions, and making  updates as needed.

section_title: State Has Faced Challenges Coordinating Changing Facility Needs
paragraphs: State officials responsible for embassy management, facilities, security,  and construction all cited the lack of an overarching plan as an obstacle  to coordination intended to address emergent post needs. According to  State officials in Kabul and Washington, coordination to address the  Kabul embassy’s future needs is particularly difficult due to the large  number of stakeholders in Kabul and in Washington. Additionally, the  constant personnel turnover caused by the 1-year tours served by most  management, facilities, and security staff in Kabul results in lack of  continuity in decision making. As far back as January 2006, the State  Office of Inspector General also identified “the near total lack of  institutional memory” stemming from the lack of staff continuity and a  “never-ending” learning curve as the most serious impediment to good  executive direction at the U.S. embassy in Kabul.

State officials in Kabul noted the growing number and frequency of  coordination meetings and teleconferences intended to address the  embassy’s future facility needs. However, they also reported that  communication at such meetings can be difficult as parties seek to  reconcile planning differences on proposed projects. Without a  comprehensive plan that provides a strategic framework to document  mission needs, catalog existing facilities, analyze gaps, provide projected  costs, and document recommendations, the competing proposals of the  post’s many stakeholders are difficult to manage, prioritize, and reconcile.  As a result, State officials in Kabul said that these meetings suffer from no  common vision and a lack of decision making. Consequently, State has  been challenged to efficiently address changing embassy needs in  several instances on- and off-compound. For example:  Interference with on-compound construction—OBO officials in Kabul  expressed frustration that proposals for new projects would often  conflict with plans previously agreed to by previous post management  staff. For example, during our fieldwork, post management proposed  to locate a helicopter landing zone near the embassy warehouse.  However, according to OBO officials on-site, they had arranged with  the previous management team to reserve that space as a staging  area for the contractor to build the warehouse expansion. When  asked about this, post management officials stated that they had no  continuity document that informed them of this earlier decision.

On-compound physical security upgrades—DS first requested  changes to the embassy compound’s security perimeter in December  2010 and added more requirements in response to attacks against the  compound in September 2011. In February 2013, the post urged OBO  to provide a project schedule and expedite the upgrades. However,  that was not done and as of March 2015 OBO and DS had not  reached agreement on schedules and costs for some security  upgrade projects.

Camp Seitz—In 2013, DS and post management decided to relocate  the Kabul Embassy Guard Force from Camp Sullivan and the  Protective Security Detail (movement protection) Guard forces from  another camp to sites closer to the embassy compound due to  security concerns. To facilitate this, DS initiated the acquisition of the  Camp Seitz site through OBO. However, according to State officials,  DS then began construction of temporary housing at Camp Seitz  without submitting the design to OBO for review or applying for a  building permit. After OBO became aware of the completed  construction, it identified fire safety deficiencies that DS had to  correct.

Camp Sullivan, Camp Eggers, Qasemi Lot Vehicle Maintenance  Facility—As part of the security contractor relocation, post  management and DS proposed removing several support facilities,  including a vehicle maintenance facility, from an ongoing construction  project at Camp Sullivan and transferring them to Camp Eggers. Post  management and DS officials stated that once the temporary vehicle  maintenance facility on-compound is demolished to make way for  apartment buildings 2 and 3, it would be better for security and  logistics to build the replacement vehicle maintenance facility close to  the compound rather than at Camp Sullivan. However, OBO  proceeded to build the Sullivan vehicle maintenance facility because  negotiations for the 30 leases required at Camp Eggers were not  complete, and OBO was concerned that if an alternative vehicle  maintenance facility was not in place, construction of apartments 2  and 3 could be delayed and their costs increased. Discussions  continued among OBO, DS, and post management, and the proposed  vehicle maintenance facility was shifted to Qasemi Lot, a site adjacent  to Camp Seitz. OBO decided not to descope the Camp Sullivan  vehicle maintenance facility until plans for a replacement facility at  Qasemi Lot were approved by OBO and DS had awarded a  construction contract with a scheduled completion date prior to the  demolition date for the existing vehicle maintenance facility on- compound. As a result, State is funding two new, temporary vehicle  maintenance facilities—one at Camp Sullivan (built by OBO) and one  at Qasemi Lot (to be built by DS).

A strategic facilities plan could have facilitated coordination in the above  cases by providing a common vision of embassy needs, comprehensively  cataloging existing assets and alternatives considered for meeting those  needs, documenting expected timelines and projected costs, and  facilitating continuity by documenting decisions made, while allowing for  updates.

section_title: Existing State Coordination Tools Do Not Substitute for a Strategic Facilities Plan
paragraphs: When asked about strategic facilities planning, State officials provided a  series of planning coordination tools as alternatives. These included  OBO’s 2010 site master plan for the embassy compound, a 2014 draft  update of that master plan, a 2014 interactive site plan (web-browser  based) showing the phased development of the compound, and an  Afghanistan project plan used by State’s facilities working group for  Kabul. Although these tools did perform some coordination functions, they  do not substitute for a strategic facilities plan. According to IFMA, a  strategic facility plan contains a needs statement, analysis of all real  property assets (owned and leased), their existing condition, analysis of  gaps between needs and current capabilities, recommendations for new  spaces or buildings, and facility cost projections.

OBO’s use of the term “master plan” created some false expectations  among non-OBO stakeholders in Kabul and Washington. For example,  officials from post management and DS believed the 2014 master plan  update would comprehensively identify the post’s needs and take into  account all facilities—to include off-compound projects—when  determining capabilities and alternatives for meeting those needs.  However, according to IFMA, a master plan in this context is limited to  illustrating the physical layout of buildings on only one specific site and  may portray aesthetics of buildings and grounds, as well as construction  phasing and timing for that site.

We found that OBO’s 2010 master plan appears to meet certain IFMA  criteria for a site master plan, rather than a strategic facility plan for a  portfolio of real property assets. For example, it showed how the  unclassified office annex would need to be completed before the  temporary USAID building could be demolished to allow apartments 2  and 3 to be built. It also showed the construction of parking facilities on  the Afghan Ministry of Public Health site, which were removed from the  current project in 2011. It did not address the use and future development  of State’s off-compound properties, or the associated elements of a  strategic facilities plan.

In January 2014, OBO’s Office of Project Development and Coordination  (PDC) began work on an update to the 2010 master plan for the embassy  compound (i.e., the 2014 Master Plan Update). The scope for this update  was limited to developing a physical site plan that could incorporate the  elements that OBO had planned to construct on the Afghan Ministry of  Public Health site (i.e., the parking facilities) somewhere on the embassy  compound. The 2014 Master Plan Update listed known needs of the  embassy and broadly suggested some might be incorporated onto the  east compound or the 6.17 site. When OBO presented the 2014 Master  Plan Update to the post in September 2014, post officials told OBO that  the site plan did not address all of the embassy’s needs. In addition, they  told us that limited space on-compound requires the continued use of off- compound facilities. OBO continues to work with stakeholders in Kabul  and in Washington to find ways to incorporate as many post needs on- compound as possible. While the 2014 Master Plan Update may  eventually be used to inform a series of new construction projects for the  compound, it remains a compound-specific document and does not  address how embassy needs will be met at off-compound facilities in the  interim. According to State officials, the future use of off-compound  facilities is discussed routinely during stakeholder teleconferences and  working groups established for Kabul embassy planning. After we  inquired about the limited nature of OBO’s 2014 Master Plan Update,  SCA officials stated that going forward they need a compound “master  plan” and a series of “addendums” that outline future plans for off- compound sites and facilities.

Additionally, SCA officials in Washington presented an Afghanistan  Project Plan to us, which they identified as the primary coordination and  continuity document for project discussions involving off-compound  facilities at the various Kabul coordination meetings, such as the Afghan  Facilities Working Group. Our review of the Afghanistan Project Plan  found it to be useful for tracking the status of active construction projects  in Kabul and determining next steps at the project level. However, it did  not catalog all existing real property assets, express interim or long-term  embassy needs, or make recommendations on fulfilling those needs.  Developed by SCA’s contractor in October 2014, the Afghanistan Project  Plan instead depicts a broad listing of ongoing State construction projects  both on- and off-compound. Each project contains sub-tasks with  deadlines, progress to completion, and notes on project status. For  example, SCA officials noted the lack of progress on the trauma center to  be built at Camp Seitz by DS due to physical design challenges.

Finally, OBO officials provided us with a 2014 Interactive Site Plan tool  (web-browser based) that officials indicated OBO developed with the  intent to provide the post with a continuity tool for the construction  planned on-compound. The tool contained numerous interactive three- dimensional diagrams of the embassy compound with background  information, construction timelines and phasing, preliminary space usage  plans, and site utility information. Although the tool focused solely on the  embassy compound, OBO officials stated that it was meant to be easily  updated as circumstances demand and could have been expanded to  included off-compound properties. According to OBO officials, they  provided this tool to post management in February 2014 with the intent  that it would be uploaded to the embassy’s internal website, where it  could be viewed and updated by stakeholders. However, OBO officials  with access to the post’s internal website reported the embassy never  used the tool and OBO is not planning to make any further updates to it.  When asked about continuity documents, post management officials  directed us solely to the 2010 master plan and did not mention this  interactive tool.

section_title: State Assigns Responsibility for Planning, but OBO Lacks Policy Governing Strategic Facilities and Master Planning
paragraphs: According to State policy, OBO’s Office of Master Planning and  Evaluations (MPE) is responsible for directing and preparing both master  plans and long-range facilities plans for posts abroad, not PDC, which is  OBO’s project coordination and management office. However, MPE has  not been involved in PDC’s on-compound master plan update or State’s  stakeholder meetings on embassy development.

OBO, Policy and Procedures Directive PPD 01, Long Range Facility Planning Program.  These criteria included such things as significant staffing changes, need to collocate State  and other agencies, political changes (e.g., post openings/closings,) security issues, and  posts where a significant investment was to be made. of individual projects. However, OBO produced no long-range facilities  plans after 2008.

In December 2013, OBO rescinded its long-range facilities plans policy  and procedures directive based on an explanation that the office  responsible for that function no longer existed and that the function had  been replaced by master planning. what master planning entailed within OBO, nor did it explain and justify  how master planning could substitute for strategic facilities planning.  According to OBO officials, master planning is defined and conducted via  stakeholder meetings and generally accepted practices within the  organization. However, OBO was unable to provide any current policy  governing either post strategic facilities planning or site master planning.  A senior OBO official acknowledged that MPE had generally not  conducted strategic facilities planning in the past few years. Without  policies that clearly define strategic facilities planning and master  planning, as well as outline the content and methods to conduct such  planning, it will be difficult for OBO to fulfill these responsibilities.

section_title: Conclusions
paragraphs: According to OBO policy, a policy and procedures directive may be rescinded when  replaced or superseded by a new directive or at the request of the proponent office. The  responsible office must sufficiently explain and justify why the directive is no longer  needed. schedule reflects the value of State’s existing risk management process  for construction. As State pursues further construction to address the  facility needs of the U.S. embassy in Kabul, it is imperative that it follow  its current policy to contain costs and manage risk where possible.

Future State construction in Kabul and other high-threat posts will likely  entail the continued use of temporary office or housing facilities,  especially in conflict areas. However, without clear standards or guidance  detailing minimal physical security measures for the temporary facilities it  constructs, State is at risk of encountering security design, cost, and  schedule extensions similar to what has already occurred in Kabul. While  State would still require sufficient flexibility to tailor physical security  protection measures to the specific and possibly changing threats  encountered at different posts, State should consider establishing clear  minimal standards or guidance for physical security on temporary  facilities, as this could yield more consistent application of security  measures at posts, more efficient procurement, and potentially contain  cost increases and schedule extensions.

Furthermore, it is clear that the changing facility needs of the Kabul  embassy will require a combination of permanent and temporary  construction on- and off-compound. Although State uses various  coordination mechanisms to manage this effort, coordination would be  further strengthened by the development of a strategic facilities plan that  catalogs existing facilities, identifies embassy needs and gaps, and  documents decisions made. Such a plan for Kabul would need to be  tailored to the specific context of the post and would likely go through  repeated updates. However, such a common framework would  strengthen existing coordination and facilitate greater continuity of  decision-making.

While past OBO policy recognized the value of such strategic planning, it  was rescinded in December 2013. No formal policy on its stated  substitute—master planning—was established, even though State  continues to assign responsibility for both strategic facilities planning and  master planning to OBO. By establishing policies that clearly define  strategic facilities planning and master planning, as well as explain the  content and methods to conduct such planning, OBO can better ensure  the usefulness of any such efforts undertaken in Kabul or in other posts  abroad.

section_title: Recommendations for Executive Action
paragraphs: To maintain State’s adherence to construction risk management policy,  guide future construction of temporary facilities, strengthen coordination  efforts to address facility needs of the U.S. embassy in Kabul, and clarify  strategic planning policy, we recommend the Secretary of State take the  following four actions:

Ensure existing cost containment and risk assessment policies are  followed in future Kabul construction projects.

Consider establishing minimum security standards or other guidance  for the construction of temporary structures, especially those used in  conflict environments.

Develop a Kabul strategic facilities plan. Such a plan should  comprehensively outline existing facilities, identify embassy needs,  establish gaps between facilities and needs, and document decisions  on meeting those needs.

Establish policy and procedure directives governing the definition,  content, and conduct of post-wide strategic facilities planning and  master planning.

section_title: Agency Comments and Our Evaluation
paragraphs: We provided a draft of this report to State for comment. State provided  written comments that are reproduced in appendix II. State concurred  with our recommendation to ensure existing cost containment and risk  assessment policies are followed in future Kabul construction projects,  stating that it will better administer cost containment and risk assessment  by adhering to relevant OBO policies. State also concurred with our  recommendation to develop a Kabul strategic facilities plan. According to  State, OBO will continue to work with post and State stakeholders to  formalize current and future embassy needs into a plan that outlines  existing facilities, identifies embassy needs, establishes gaps between  facilities and needs, and documents decisions on meeting those needs.  Finally, State concurred with our recommendation to establish policy and  procedure directives governing the definition, content, and conduct of  post-wide strategic facilities planning and master planning. According to  State, OBO is currently developing a policy and procedures directive that  will outline the new master planning program and post-wide strategic  facilities planning.

State partially concurred with our recommendation to consider  establishing minimum security standards or other guidance for the  construction of temporary structures, especially those used in conflict  environments. State does not support separate standards for temporary  structures, reiterating that it aims to meet Overseas Security Policy Board  security standards in all environments. Where this is not possible, State  asserts it works to meet the intent of these standards through alternative  security mitigation measures via its “waivers and exceptions” process.  However, State does believe that there is value in documenting standard  operating procedures and best practices associated with the deployment  and protection of temporary structures in high-threat and conflict  environments. State noted that while such documentation would not  constitute security standards and would not circumvent risk management  integral to its waivers and exceptions process, it would provide templates  from which to base the design of future projects in exigent environments.  Should State produce such documentation, we believe that this could  meet the intent of our recommendation.

State also provided technical comments, which were incorporated into the  report as appropriate.

We are sending copies of this report to the appropriate congressional  committees, the Secretary of State, and other interested parties. In  addition, the report will be available at no charge on GAO’s website at  http://www.gao.gov.

If you or your staffs have any questions about this report, please contact  either Michael J. Courts at (202) 512-8980 or at courtsm@gao.gov or  David J. Wise at (202) 512-5731 or at wised@gao.gov. Contact points for  our Office of Congressional Relations and Office of Public Affairs can be  found 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: Objectives, Scope, and Methodology
paragraphs: We reviewed State Department (State) construction efforts at the U.S.  embassy in Kabul under the authority of the Comptroller General to  conduct evaluations on GAO’s initiative because of broad congressional  interest in the oversight and accountability of U.S. funds used in  Afghanistan. In the report we examine (1) the extent to which construction  cost and schedule have changed and why, (2) State’s use of temporary  facilities on-compound, and (3) State’s planning for projected embassy  facility needs.

To conduct this review, we obtained information from agency planning,  funding, and reporting documents and interviewed officials from State’s  Bureau of Overseas Building Operations (OBO); Bureau of Diplomatic  Security (DS); Office of Acquisitions Management; Bureau of South and  Central Asian Affairs (SCA); Office of the Special Representative for  Afghanistan and Pakistan (SRAP); and Office of Management Policy,  Rightsizing, and Innovation. Within OBO, we met with officials from  Construction Management, Design and Engineering, Master Planning and  Evaluations, Project Development and Coordination, Real Property  Leasing, Security Management, Strategic Planning, and Financial  Management. Within DS, we met with officials from High Threat  Programs, Overseas Protective Operations, and Physical Security  Programs.

In February 2014, we traveled to Kabul, Afghanistan, to observe  construction progress and meet with U.S. embassy officials responsible  for construction, facilities management, post management, and security.  We also met with contractor officials in Kabul and in the United States. In  addition, our Kabul Field Office conducted follow-up meetings with  officials in Kabul and their successors through December 2014. We  incorporated audit work from our February trip and relevant material  gathered for our July 2014 report into this audit. In addition, we obtained  State funding information on all such projects over $1 million in Kabul. We  determined that these funding data were sufficiently reliable for the  purposes of this report.

To examine the extent to which construction cost and schedule have  changed and why, we collected and analyzed State and contractor  documents and met with relevant officials. We analyzed contract files for  the fiscal years 2009 and 2010 Kabul construction projects, including  requests for proposals, site surveys, project authorization documents,  design drawings, contract modifications, cost estimates, approved  schedules, and other contract documentation. We also examined OBO  and other State planning and oversight documents, such as space  requirements programs, trip reports, rightsizing reviews, site plans, OBO  briefings to State management, and progress reports. In addition, we  examined Office of Management and Budget and State policy and  procedures governing construction planning and implementation,  including those pertaining to value engineering (cost containment) and  risk assessment. We also met with relevant officials in OBO, DS, and  SCA, and in Kabul to discuss the original planning of the 2009 and 2010  contracts, as well as current construction progress.

To examine State’s use of temporary facilities at the embassy, we  inspected the temporary offices and housing currently on-compound and  reviewed related State planning, design, construction, and contract  documents for the temporary facilities within the 2009 contract. We also  reviewed State budget justifications to Congress related to State’s use of  temporary facilities and security concerns about those facilities. In  addition, we examined State physical security and building standards for  State-built facilities, as well as Department of Defense security and  building standards for temporary facilities. We also obtained funding  information from State on what it has allocated to the construction of  temporary facilities in Kabul since 2002. In addition, we interviewed  embassy management officials, OBO’s on-site project director for  construction, and OBO facility managers in Kabul. We also met with  OBO, DS, and SCA officials in Washington to discuss State’s  construction, use, and plans for temporary facilities.

To examine State’s planning for projected embassy facility needs, we  analyzed State coordination and planning documents, as well as funding  proposals for new construction in Kabul. In addition, we reviewed State  policy regarding master planning and strategic facilities planning. We also  consulted best practices for such planning established by the  International Facility Management Association (IFMA), as well as GAO  and Office of Management and Budget capital planning guidance.discuss changing post facility needs and the various coordination efforts  to address those needs, we met with State officials from OBO, SCA,  SRAP, and DS, as well as with post officials responsible for management,  facilities, and security in Kabul.

We conducted this performance audit from July 2014 to May 2015 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 U.S. Department of State

section_title: Appendix III: GAO Contacts and Staff Acknowledgments
subsections: section_title: GAO Contacts
paragraphs: Michael J. Courts, (202) 512-8980 or courtsm@gao.gov  David J. Wise, (202) 512-5731 or wised@gao.gov.

section_title: Staff Acknowledgments
paragraphs: In addition to the contacts named above, Michael Armes (Assistant  Director, Physical Infrastructure), Leslie Holen (Assistant Director,  International Affairs and Trade), David Hancock, Eugene Beye, John  Bauckman, Jacob Beier, Jon Fremont, and Marc Schwartz made key  contributions to this report. Technical assistance was provided by Lynn  Cothern, Kristine Hassinger, Ernie Jackson, Tina Cheng, and Gwyneth  Woolwine.


Question-summary annotations: questions: question: Why have the cost and expected time increased for the Kabul embassy construction project?
answer: Cost and schedule have increased for the Kabul embassy construction project, in part due to incomplete cost and risk assessment.
child_questions: question: What data did GAO collect to support this?
answer: Cost for the 2009 and 2010 contracts has increased by about 27 percent, from $625.4 million to $792.9 million, and is likely to increase further. Projected completion has been delayed over 3 years to fall 2017.

question: What caused such increases in cost and schedule?
answer: The Department of State (State) did not follow its cost containment and risk assessment policies, resulting in lost opportunities to mitigate risks. These risks, such as delays in the sequencing of the two contracts, eventually materialized, increasing cost and extending schedule.
child_questions: question: What does this suggest about the efficiency of State's future projects?
answer: Unless State follows its policy, it may be unable to avoid or mitigate risks to cost and schedule on future projects.

questions: question: What has State spent over $100 million on since 2002?
answer: Since 2002, State has built over $100 million in temporary buildings (intended for no more than 5 years' use) to meet space needs on-compound but has no security standards tailored to those facilities.
child_questions: question: What will the state of these facilities be upon completion?
answer: On completing the project in 2017, all temporary facilities will be 5 to 10 years old, and their continued use is likely.

question: What issues did State's failure to apply alternative security measures cause?
answer: Without security standards or other guidance to guide temporary facility construction in conflict environments, State inconsistently applied alternative security measures that resulted in insufficient and different levels of security for temporary offices and housing, as well as increased cost and extended schedules.
child_questions: question: What issues could a continued failure to apply security measures cause in the future?
answer: Without temporary facility security standards or guidance, future construction in conflict environments could encounter similar problems.

questions: question: What issues has State's lack of a strategic facilities plan caused?
answer: State's lack of a strategic facilities plan and policies governing such planning has led to coordination challenges in addressing the embassy's future facility needs.
child_questions: question: How does State's approach to addressing the embassy's facility needs conflict with industry standards?
answer: Industry standards cite the value of plans that comprehensively assess existing facilities, identify needs, and document decisions on meeting those needs.

question: How was this demonstrated by State's construction of a guard facility in Kabul?
answer: In Kabul, however, State constructed a guard facility without proper design review or applying for a building permit, leading to fire safety deficiencies that State corrected at extra cost.

question: What does State lack sufficient policy in?
answer: Finally, State formally assigns responsibility for strategic facilities planning but lacks policy that governs implementation of such planning.

question: What does State plan to do to address future facility needs?
answer: State intends to make additional facility investments to address future facility needs.
child_questions: question: Why might this prove difficult?
answer: Without a strategic facilities plan and policy to guide its development, coordination to address these needs will continue to be difficult.

questions: question: What has the U.S. embassy in Kabul experienced since reopening in 2002?
answer: Since re-opening in 2002, the U.S. embassy in Kabul, Afghanistan, has experienced a dramatic increase in staffing, followed by a gradual drawdown.
child_questions: question: What steps did State take to respond to this increase in staffing?
answer: State has invested or plans to invest a total of $2.17 billion in U.S. facilities to address current and projected space needs. State awarded two contracts in 2009 and 2010 to construct additional on-compound housing and office facilities.
child_questions: question: What changes did State make to these contracts since their creation?
answer: State partially terminated one contract for the convenience of the U.S. government, and expanded the construction requirements of the second, affecting cost and schedule.

question: What is State's Bureau of Overseas Building Operations responsible for?
answer: State's Bureau of Overseas Building Operations is responsible for the planning, design, and construction of U.S. embassies.

question: What is the purpose of this report?
answer: This report updates and expands upon GAO's previous work.