[Congressional Record Volume 140, Number 149 (Thursday, December 1, 1994)]
[Senate]
[Page S]
From the Congressional Record Online through the Government Printing Office [www.gpo.gov]


[Congressional Record: December 1, 1994]
From the Congressional Record Online via GPO Access [wais.access.gpo.gov]

 
   POTENTIAL WASTE OF TAXPAYERS' DOLLARS IN THE FEDERAL GOVERNMENT'S 
                      MILITARY FACILITIES PROGRAM.

  Mr. DORGAN. Mr. President, on Wednesday, June 22, 1994 I conducted a 
hearing of the Governmental Affairs Committee's Task Force on 
Government Waste, to examine the potential waste of taxpayer dollars in 
the Federal Government's Military Facilities Program.
  This hearing focused on the fact that poor planning and failure to 
heed early warning signs have resulted in wasting hundreds of millions 
of dollars in unneeded and unnecessary construction projects. Further 
the hearing highlighted the fact that the Department of Defense [DOD] 
does not have adequate controls in place to ensure the continued need 
for a facility as it moves through the approval process. Finally, there 
is overwhelming evidence to suggest that Defense Department routinely 
ignores the recommendations of the DOD IG or their in-house auditors 
with respect to redefining or cancellation of unneeded or bloated 
projects.
  This was the case with the Army's plan to construct new office space 
for 30,000 personnel at Fort Belvoir, VA.
  The Army plans to develop new office space at the 820-acre Engineer 
Proving Ground [EPG] in Fairfax County, VA to consolidate 30,000 Army 
employees currently in leased space throughout the Metro Washington 
Area.
  An independent report prepared by Tai Realty Consultants of McLean, 
VA for the Fairfax County Office of Comprehensive Planning and released 
in October 1993 questioned the viability of the project.
  Due to substantial differentials between the value of development 
rights at the site, and the cost of required infrastructure and of Army 
buildings, the Tai Consultants concluded the EPG Development Program, 
as originally envisioned, is simply not feasible. We estimate that the 
Army's Development Program will result in total, outstanding lease 
obligations of over $200 million following the sale of the Phase V 
Development Rights. Based upon somewhat more conservative estimates, 
this figure would exceed $270 million, and county staff estimates of 
additional infrastructure costs could increase this amount of by 
possibly $80 million, or more.
  Because of these concerns, I requested that the U.S. Army Audit 
Service review the feasibility of the proposed project and report their 
findings to the task force on government waste.
  On November 16, 1994, the U.S. Army Audit Service released Audit 
Report SR 95-753.
  Overall Conclusions:
  The Army's plan to obtain 2.9 million gross square feet of office 
space in exchange for development rights on the Engineer Proving Ground 
was overly optimistic and not financially feasible.
  Requirements in the draft request for proposals weren't clear enough 
to make sure the Army selects the developer that can provide the best 
value.
  The Army's requirement for 2.9 million gross square feet of office 
space was overstated.
  Procedures for keeping potential tenants up to date are inadequate. 
But procedures for identifying potential tenants needed improvement.
  The program manager didn't maintain adequate documentation to support 
cost analyses. Because adequate documentation wasn't maintained, we 
couldn't determine if documentation was accurately prepared.
  Procedures for identifying the information mission area 
infrastructure are generally inadequate.
  The program office didn't have adequate documentation to support its 
market projections. We couldn't determine if the projections were 
reasonable.
  Procedures for ensuring the Army receives fair market value for its 
property were properly documented and reasonable. However, we can't 
determine how effective they are, until they are implemented.
  Because of this report I will request that the Secretary of the Army 
report to Congress any contractual commitment impacting the EPG at lest 
10 working days prior to ratification. This action will insure that the 
project can indeed be completed without cost to the taxpayer and that 
it meets legitimate military needs.

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