[Congressional Record Volume 143, Number 85 (Wednesday, June 18, 1997)]
[Senate]
[Pages S5904-S5918]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
NATIONAL DEFENSE AUTHORIZATION ACT FOR FISCAL YEAR 1998--PUBLIC-PRIVATE
COMPETITION OF DEPOT MAINTENANCE
Mrs. HUTCHISON. Mr. President, I thank the majority leader for
stating his concerns here. I notice the distinguished committee
chairman is also here.
I think it is very important that the rights of Members be upheld
here because there is a significant issue that is very important to the
Department of Defense for the readiness of this country that is at
issue in this bill. Heretofore, our side has not really had any ability
to have an accommodation or to make sure that what the Department of
Defense wants to do, what BRAC allowed them to do, in fact they will be
able to do. Because in the bill that would be brought before us, it
vitiates any public-private competition for depot maintenance work by
the Air Force. That is the effect of this bill.
To think that someone, for parochial interests, would put language in
a bill that would do away with what BRAC said to the Department of
Defense was their option, which is to go out and spread the workload to
other depots from the bases that are closed, or privatize in place, the
Department of Defense should be able to make the decision based on the
efficiency of taxpayer dollars and where we need the defense dollars to
go. The Department of Defense should be able to make that decision.
That is what BRAC said.
The Department of Defense made the decision. They said it would be
more efficient and save more money to privatize in place. They are
doing public-private competition to make sure that the price is better.
Yet the bill that would come before us says they cannot do any of that
work, privatize in place, until the depots get the work and are up to
75 percent of their capacity. Well, that is impossible, because some of
those depots may not ever get to 75 percent capacity, nor does that
have anything to do with efficiency.
So, Mr. President, yes, we are standing on principle. We are standing
on the principle that the Department of Defense should be able to have
a public-private competition, to save taxpayer dollars and to put those
defense dollars into readiness. We can save millions of dollars for the
taxpayers and for the Department of Defense. And those millions of
dollars, rather than being wasted, can be put into equipment that will
keep our troops safe and secure.
We are standing for the integrity of the BRAC process. We are
standing for the integrity of the Department of Defense and for their
ability to make their decisions without congressional mandates that
cause the waste of millions of dollars for the taxpayers and for the
young men and women who are putting their lives on the line to protect
our freedom. That is what this issue is.
So, yes, Mr. President, we are objecting. We hope to find an
accommodation. I will say that the distinguished chairman of the
committee wants to find an accommodation that will give the Department
of Defense the flexibility they need, that will do right by the
taxpayers of this country, that will do right by the people who are in
our Armed Services, and that will do right by the depots that are still
left in Oklahoma, Utah, and Georgia.
We want something that will be fair to everyone. And when we come to
that fair conclusion, then we will be happy to debate this bill and
hopefully authorize a good defense bill. But, Mr. President, make no
mistake, if there is not a defense authorization bill that can be
worked out that can be fair, I hope that we will not go forward putting
shackles on the Department of Defense and wasting taxpayer dollars.
I hope we will have the strength to resist that.
The PRESIDING OFFICER. The Senator from California.
Mrs. BOXER. Mr. President, I want to associate myself with the
remarks of my colleague from Texas, Senator Hutchison, who I thought
really homed in on why this issue is so important. I am very pleased
the distinguished chairman of the committee is here because it gives us
an opportunity to speak with him about why we are so frustrated about
this bill as it now stands.
Mr. President, it would be a historic moment if this bill were to
pass because it would, for the first time ever, overturn a BRAC
decision. Now, we all know that when the four base closure rounds went
through Washington, DC, many of us were not happy with the process.
Many of us felt the savings were overstated. Many of us felt this was
not the right way to go. But not one of us, until today, moved to
undermine a BRAC decision.
By objecting to this bill, we are taking a stand, it seems to me, for
the integrity of the process. After all, this is the law of the land.
This is just the kind of unraveling we do not want to see happen,
because if this effort succeeds to overturn BRAC, to stifle competition
between the private sector and the public sector with respect to depot
maintenance, where will it end? Tomorrow, someone else will try another
unraveling, and the day after, someone else will, and we will have
chaos.
I want to say, Mr. President, there are two other reasons why this
bill as drafted is so harmful. Not only does it unravel the Base
Closure Commission's decisions of the past but it undermines a promise
made to the people in the Sacramento area and the people in Texas who
will be so adversely affected. There was an explicit promise by the
President of the United States that privatization in place could take
place at McClellan Air Force Base. There was also a promise made by
Congress that such privatization in place could move forward at
McClellan. After all, Congress passed the BRAC, so, therefore, we would
be breaking a deal, a sacred deal, really, made with these people who
were told that privatization in place could, in fact, occur.
Lastly, Mr. President, I thought we were all really concerned here
about
[[Page S5905]]
taxpayer dollars. We are doing everything we can to bring down this
deficit. I am so proud to be a part of the team that brought down the
deficit from $290 billion in 1993 to less than $70 billion now. We have
agreed on a balanced budget deal to finish the job. This is great for
taxpayers. This is good for our country. It is good for our economy. So
why would we now reverse course and to say that the private sector's
ability to compete with the public sector will be cut short?
It will be a bad deal for the taxpayers if we do not reach some kind
of agreement here. I hope we do because if the bill as drafted becomes
the law of the land, it will force the Pentagon to waste money. This
bill will essentially direct the Pentagon to waste money by preventing
the fair and open competition that is underway to win contracts for
depot maintenance work at Kelly and McClellan Air Force Bases.
So every way you look at it--from standing behind the law of the
land, the BRAC process, to keeping our word to workers who trusted us
when we said privatization in place can take place, to taxpayers who
know that it makes no sense to eliminate competition--if you look at
all of these factors, Mr. President, I think what the Senators from
Texas and the Senators from California are doing here is in the best
interests of the U.S. Senate, of the U.S. Congress, and, frankly, in
the best interests of the United States of America.
I am working with the senior Senator from California, Senator
Feinstein, who you will hear from shortly, my colleagues from Texas,
and hopefully all others who want to see this bill move forward. We
have no interest in preventing this bill from moving forward. We want
to reach an accommodation here. I think there are ways we can do it.
We are so sure that competition is a good thing, we are so positive
that privatization in place will reap rewards for taxpayers, that we
are willing--we are very willing--to agree to language that would
ensure that this could only occur if the taxpayers save money.
I am very hopeful that we can reach an agreement. Until then, we will
fight for our rights as Senators to protect a promise made to the
people of our communities and a promise made to the taxpayers.
I yield the floor.
The PRESIDING OFFICER. The senior Senator from California.
Mrs. FEINSTEIN. I thank the Chair. Mr. President, I thank the Senator
from California and the two Senators from Texas for joining me in this
coalition.
I certainly do object to the motion to proceed to the bill. I want to
explain why in some detail. These provisions that the Depot Caucus put
in not only halts the public-private competitions for depot workload
currently underway at both McClellan and Kelly Air Force Bases, but it
essentially undermines any effort to do this work in the private sector
in a more cost-effective way.
The option to privatize certain depot workloads was explicitly made
available by the BRAC Commission and was a part of the base closure
decision. Yes, let their be no doubt, these bases will be closed. We
know that. But an effort was guaranteed to be put underway to see if an
amount of this workload could, in fact, be privatized. In its report to
the President, the BRAC 95 Commission specifically recommended that the
department ``consolidate the remaining workloads to other DOD depots or
to private-sector commercial activities as determined by the Defense
Depot Maintenance Council.''
The President strongly supported the Commission's decision,
specifically reinforcing the option of privatization. In his letter to
the chairman of the BRAC 95 Commission, the President stated, ``I was
pleased to learn that * * * you confirmed that the Commission's
recommendations permit the Department of Defense to privatize the work
loads of the McClellan and Kelly facilities in place or elsewhere in
their respective communities. * * * In my communication with Congress,
I have made clear that the Commission's agreement that the Secretary
enjoys full authority and discretion to transfer workload from these
two installations to the private sector, in place, locally or
otherwise, is an integral part of the overall BRAC 95 package it will
be considering.'' The President goes on to say, without ambiguity,
``Moreover, should the Congress approve this package but then
subsequently take action in other legislation to restrict privatization
options at McClellan or Kelly, I will regard this as a breach of Public
Law 101-510 (the base closure law) in the same manner as if the
Congress were to attempt to reverse by legislation any other material
direction of this or any other BRAC.''
I think that's pretty clear.
Let me say that I firmly believe if this bill goes forward with the
depot language in it, the President of the United States should veto
the bill. Not to veto the bill is to say that the BRAC decisions and
the decisions made surrounding the 1995 base closure decision are no
longer valid. Their integrity is clearly punctuated by this kind of
special interest drive.
Let me go on to say that some have alleged that this privatization
process is an attempt to keep McClellan and Kelly open. Let me disabuse
my colleagues of that. I want to be very clear. McClellan and Kelly
will both be closed in the year 2001. That decision has been made. The
property and buildings at McClellan will be transferred by the Air
Force to recipients in the local community according to the base reuse
plan.
Two private companies, Boeing and a group led by AAI Corp. and one
Air Force depot, Hill Air Force Depot in Utah, have each been awarded
$750,000 in Air Force contracts to formulate their bids for the
workload package at McClellan. Final bids from these competitors for
this workload are due in September of this year. The contract is
scheduled to be awarded in January 1998. This aspect of privatization
is now underway, Mr. President, and essentially what we have in this
bill is a special provision which would halt the contracts currently
proceeding. It is to this that we strongly object.
The workload package, currently under development by the Air Force,
will be worth approximately $220 million and will affect only 2,300
McClellan Air Force Base employees. McClellan ALC, Air Logistics
Center, employed over 8,000 people before the BRAC 1995 round, and
currently employs less than 7,800 people. So you can see the workload
package we are talking about affects about one-third of the employees
that used to work at McClellan Air Logistics Center.
The Air Force's planned workload package at McClellan will include
maintenance and repair of the KC-135 refueler aircraft and A-10 close-
air support aircraft. It will also include repair work and maintenance
on hydraulics systems, instruments and electronic components and
electronic accessories for numerous aircraft systems. Finally, the
workload package will include software support activities, parts repair
and assembly for the KC-135 and A-10, and the packaging and movement of
parts to military customers.
The public/private competition for this work can save taxpayer
dollars. If the competition for this work is won by the private sector,
hundreds of millions of dollars in savings could be realized by
avoiding the costs of new military construction, movement of the
workload, and retraining workers at Hill Air Force Base. Additional
savings can come from taking advantage of any potential efficiencies in
private industry.
Let me make another point. Past Federal investments at McClellan
should not be ignored. Since 1987, the Department has spent $150
million on military construction projects at McClellan. Outright
closure of these facilities before the year 2001 means the U.S.
taxpayer not only forfeits this expenditure but also must pay for new
military construction at another Air Force base so this workload can be
moved. The Defense Department will have to spend hundreds of millions
of dollars to duplicate the facilities now in operation at McClellan.
As the Defense Department phases out its operations at McClellan and
Kelly Air Force Bases, privatization provides a means to reduce
overhead costs by bringing defense and commercial work together. If
private industry wins the competition for this workload
[[Page S5906]]
package, they will be able to add commercial products along with their
Defense Department workload. This innovative approach will expand
employment opportunities at these closing facilities and increase
savings to the Department through decreased overhead costs and enhanced
efficiency.
The Depot Caucus' language takes none of these potential savings into
account and violates every proven principle that competition reduces
costs. The Depot Caucus provision would sole-source billions of dollars
of depot maintenance work to government facilities regardless of the
cost or the impact this noncompetitive practice would have on DOD's
management plans and strategies. In addition, the Depot Caucus'
unqualified opposition to privatization goes against a clear national
trend. The language ignores not only the lessons learned by industry,
but also the guidance of DOD's most respected advisory reports.
This spring's Quadrennial Defense Review stated that DOD should,
``Conduct public-private competitions for depot maintenance work that
does not contribute to core capability when other appropriate
outsourcing criteria are met. In addition, [DOD] will partner in-house
facilities with industry to preserve depot-level skills and utilize
excess capacity. Savings will be achieved as a result of these
competitions and the reductions in excess capacity.''
The May 1995 Commission on Roles and Missions [CORM] of the Armed
Forces strongly urged increasing privatization. CORM recommended ``that
the Department make the transition to a depot maintenance system
relying mostly on the private sector.''
In fact, the 1995 Base Realignment and Closure [BRAC] Commission
Report strongly supported depot privatization, writing, ``The
Commission believes reducing infrastructure by expanding privatization
to * * * DOD industrial and commercial activities will reduce the cost
of maintaining and operating a ready military force.''
The vast majority of private firms are also moving toward increased
reliance on outsourcing to become more efficient and remain
competitive. The DOD can learn and benefit from the private sector's
experience.
We have an opportunity to save money by allowing the competitions for
workload at McClellan AFB to go forward. If the bids made by private
industry are not financially feasible, then the contract will be
awarded to the public bidder, Hill AFB. But, if a private bidder does
win, then we will have our first opportunity to reduce the cost of
depot maintenance activities through careful use of private enterprise.
The General Accounting Office's study of depot workload privatization
never considered the question of how much could be saved if this
workload was privatized. It only considered the costs of maintaining
that workload at Kelly and McClellan as compared to consolidating it
into the remaining air logistics centers. The privatization of this
workload will not be business as usual.
Finally, many of my colleagues are concerned that readiness will
suffer at the hands of greater outsourcing and privatization. DOD,
however, has entrusted our military's readiness to private contractors
for years. Currently, several weapons systems, including the KC-10
refueling aircraft, the F-117 stealth fighter, the B-1B bomber, and the
software maintenance for the B-2 bomber are completed by private
contractors.
I believe that the leadership of our armed services will continue to
ensure that any DOD depot maintenance workload that is outsourced will
be maintained appropriately, to DOD's own high standard. Allowing
noncore depot workload to privatize simply permits DOD to award work to
the most qualified, most reliable contractor, whether that contractor
is a public facility or a private company.
In supporting the defense industrial base, DOD's policy calls for
greater reliance on the private sector for appropriate depot
maintenance workload. Outsourcing helps preserve private sector
capabilities and enhances DOD's ability to capture new technologies
that are constantly being developed in the private sector. By
introducing greater competition into the mix, outsourcing lowers the
cost of depot-level maintenance activities.
I firmly believe that the Nation will always require a public sector
depot capability for certain mission-essential workloads and skills.
Unfortunately, the depot language included in the DOD authorization
bill will squander essential readiness and modernization funds. The
Defense Department has defined public depot maintenance policy for the
21st century. It is time that we move beyond the arbitrary laws
defining the policy of the past, and allow public/private competition
to move us forward.
These are the points that I wanted to make today. But, let me
emphasize, the Depot Caucus' amendment will eventually cost the
taxpayers much more money by duplicating existing facilities. In
addition, the contractual process, including the request for proposals
has already begun and, at McClellan, two companies--Boeing, AAI Corp.,
and one Air Force depot, Hill Air Force Depot--have already been
awarded $750,000 in Air Force contracts to formulate their bids for
this workload. Now the Congress is trying to step in and say, ``We are
going to stop these competitions midstream.'' I think that makes no
sense for the taxpayers and it makes no sense for the credibility of
the BRAC process.
I, for one, am delighted to join with my colleagues both in my own
State and in Texas to work to see if we cannot come up with some
compromise. Absent that compromise, I firmly believe the President
should veto this bill.
I yield the floor.
The PRESIDING OFFICER. The Senator from Georgia.
Mr. COVERDELL. Mr. President, it is indeed unfortunate that such a
critical piece of legislation for the authorization of the Department
of Defense has been encumbered by a disagreement over the last Base
Closure Commission findings.
If I might, Mr. President, give a broad overview as one of the
Senators who was deeply involved in the last round of the BRAC, Base
Realignment and Closure Commission. BRAC was designed because it is so
terribly difficult for the issues of base closures and shutdowns to be
handled in this political environment. So a highly disciplined system
was envisioned--a commission that would independently review these core
and critical issues and would come back to the legislature, and the
legislature would have to vote it up or down. No amendments could be
made.
In other words, the traditional legislative actions and prerogatives
were removed. You could only be for it or against it. In this
particular case, the Air Force had five bases throughout the country,
and many experts thought there were too many and some had to be closed.
Originally, the Air Force wanted to keep all five of them open as the
process began. But BRAC did not agree with them. BRAC thought that
would make five Air Force bases inefficient and, therefore, some had to
be closed and the work moved to the remaining Air Force bases to
produce an efficiency ratio.
After extensive discussions by BRAC and their commission, they came
to the legislature and recommended the closure of Kelly Air Force Base
in Texas, which is tough. If you ever lived in a community where one of
those closures occurred, it is tough. I understand and empathize with
the Senators from California and Texas. That is tough medicine. But
they called for the closure of Kelly in Texas and McClellan in
California, leaving three Air Force logistics centers open--one in
Georgia, one in Oklahoma, one in Utah. The work would be moved to the
remaining three, making those three efficient operations.
Mr. President, the administration and the President sullied BRAC,
because they overrode the commission. In other words, the people had to
live by it, Congress had to live by it, but the administration didn't.
We were in an election year. Texas and California are very big and very
important. So they instituted this concept of privatization. They
theoretically closed Kelly and McClellan, as has been alluded to by the
Senator, but they left everything else there under the guise of
privatization. For example, the total number of employees at Kelly and
McClellan before the Base Closure Commission called for their closing
was 33,000 people. Today, the number of
[[Page S5907]]
employees at these two installations is 31,000 employees. That is
according to the General Accounting Office. The General Accounting
Office has told us that this override has resulted in the failure to
save $400 million to $600 million.
The point that I want to make is that when the administration decided
to intervene in the findings of the Base Realignment and Closure
Commission, they reintroduced the very activity that we are engaged in
on the Senate floor today. They put it back into the political process.
I can say this, Mr. President. There will never be another BRAC, as we
knew it, because you can't have a discipline where the people had to
stand up and fight for their installations, the people that work there.
The Congress had none of its authority. All of its prerogatives were
removed except to vote for or against it, and then the administration
may unilaterally alter it. That voids the discipline. So that process
will never occur again. It can't. If you are going to have something
that highly disciplined, it has to apply to the people of our country,
the citizens that are affected, to the members of the legislative body,
and to the President of the United States. It can't just apply to two
parts of the puzzle. With this exercise, you track it directly to the
White House. When they decided to take the Base Realignment and Closure
Commission and politicize it, that, if effect, eliminated BRAC as a
discipline or policy that can ever be used by this Government again to
deal with these contentious questions. If it ever comes again, it will
have to be completely redone and redesigned so that it applies to the
President and the administration as well as to the people in the
Congress.
I understand the Senator from Texas. Once that policy was breached,
she has no choice but to defend the people of Texas and the workers in
Texas. It is the same with the Senators from California. This was what
BRAC was to have avoided--and it did, for all practical purposes, until
the last round.
Mr. President, it is unfortunate. It means that that system will
never be used again, from my point of view, until the administration
and Department of Defense can certify that the recommendations of the
last round of BRAC have been carried out, that the three remaining
logistic bases have been shifted to work that was purported to go there
to make them efficient. There is just not going to be another Base
Closure Commission. The Department of Defense is going to have to
demonstrate that they got the job done from the last ones before they
come back and ask for new ones, and the Department of Defense and the
administration are going to have to rewrite the rules so that it
applies to them as well as to the people in Congress.
I yield the floor.
Mr. INHOFE addressed the Chair.
The PRESIDING OFFICER. The Senator from Oklahoma is recognized.
Mr. INHOFE. Mr. President, I think we all know certain things are
true and incontrovertible. One is that a base closing is a very
difficult thing to do politically and a very difficult thing to endure
as a Member of the U.S. Senate or a Member of the other body, because
people look to us and they look to us and say, ``You are responsible
for saving what we have here.''
I am not eloquent enough to describe the anguish that people go
through, that cities go through, that counties and the States go
through during a BRAC process. They go out and they hire consultant
after consultant and they spend hundreds of thousands of dollars. They
go through all of this and, finally, the recommendations come down. We
have gone through that in 1991, 1993 and 1995, and it was necessary. It
was, I guess, the Army that came up with the initial idea that we try
to eliminate excess capacity and infrastructure. But we haven't been
able to do it because politically it can't be done. There is no better
evidence of that than what is happening today.
They established a process that was to be totally free from political
interference. Seemingly, it worked for a while. I don't have the exact
number of installations that have been closed down, but we all
understand that we are going through a difficult time with our defense.
We all understand that we have a President of the United States who is
not strong on defense. He would like to have us think there is no
threat out there, that the cold war is over, so we can start reducing
down to the point where we cannot begin to defend America on two
regional fronts. We all know that is true today.
The bottom line is that we had too much infrastructure. It was up
here. So we brought it down, in 1991, 1993 and 1995, to a level that is
down now and still a little bit above our force strength. As far as
future BRACs are concerned, I contend that I don't want to get this
infrastructure down so artificially low so that when we rebuild, we
will not have the infrastructure to accommodate that. I agree with the
Senator from Georgia, who says that we have to position ourselves so
that we know if we go through all of this anguish again, we will not
have political interference.
Anyway, I am going to tell you a story, Mr. President, and you may
not believe me. I think you know me well enough to know that I do tell
the truth. I was in a very tough election when I was in the other body,
and I ran for the Senate in 1994. I ran against a guy who is young,
articulate, and a very smart young man. He was a Member of the House of
Representatives, a member of the other party. He was on the House
defense committee at that time, which was called the House Armed
Services Committee, now called the House National Security Committee.
He said, ``Elect me and I will use political influence to make sure
that none of the bases are damaged in the BRAC processes.'' We have
five installations in the State of Oklahoma.
I made a public statement in the newspaper. I said, ``I will not use
political influence because I know we have to do something about this
infrastructure. What I will do is I will stay out of it until the
recommendations are made, and when they are made, I will walk through
fire to defend the recommendations of the BRAC committee, because the
system has to work. We can't allow this to become a politicized
system.''
So we did that pretty well. I have a list here of various States and
Senators that cooperated when they came through in 1991, 1993, and 1995
and said they wanted to close certain bases. They said, well, it is
going to hurt at home, hurt me politically, but we are going to have to
do it. They bit the bullet.
Now we are asked to make two exceptions. I agree with the Senator
from Georgia when, certainly, the Senator from Texas is put in a very
awkward situation by our President because, in August of 1996, right
before the election, when President Clinton was campaigning out in
California with a huge number of electoral votes, he said this to them
and made a commitment that ``I will see to it that no jobs are lost in
California and no jobs are lost in Texas, and we will privatize.'' He
grabbed that out of the air. So that commitment had to be--I don't
think there is anybody in America today that doesn't know that that was
a highly politically charged commitment and statement he made. He made
that statement. Then that puts everybody in the position that, wait a
minute, if you have the President agreeing that we are not going to
close those installations, McClellan and Kelly, in California and
Texas, what about you Senators, aren't you going to stand behind the
President? You have that leverage.
That is where we are today. So we went through this process. I find
myself in the situation now that the recommendations have been made
that we are going to have to stand behind the recommendations.
I want to suggest to you, Mr. President, we have made some
compromises. Senator McCain from Arizona had some objections and
concerns in our committee. I am chairman of the Readiness Subcommittee
of the Senate Armed Services Committee. We went through this and
debated these issues for hours and hours on how to protect the
integrity of the BRAC system because it became a dollar decision. We
were going through the marking up of an authorization bill where we are
trying to rebuild our defenses and sustain a level that will adequately
protect America. We have considerations on modernization programs that
cost money. We have barracks out there needing replacement. There are
quality-of-life issues and modernization issues. These things are maybe
$100,000
[[Page S5908]]
or maybe $1 million a lick. We have had to turn them down.
Now we have an opportunity to follow the recommendations of the BRAC
committee and save the defense system approximately $468 million a
year. Now, if you carry that out to 5 years, you are talking about
$2.34 billion. If you don't do that, where is the money going to come
from? If they are successfully able to compete and end up with the jobs
in Texas or California, or privatize in place, it is the same thing. We
don't want to confuse people. Those people advocating competition
realize that they want competition because they want to protect the
jobs there. I understand this. Just because it is dealing in semantics,
privatization in place, or competition, where they will be able to
leave the jobs there, it doesn't make a difference. The bottom line, as
the Senator from Georgia said, is that we will still have five air
logistic centers. So it came out with the recommendations. GAO said
that if we don't do it, it is going to cost $2.34 billion over a 5-year
period. That is money that has to, realistically, come out of the
defense system. I don't know where it is going to come from.
Mr. President, we had several hearings where we had the chiefs of
services. So I asked each of the four chiefs of services, ``Where are
you going to come up with this money?'' If we end up having to violate
the BRAC and it ends up costing us $2 billion, where are you going to
come up with the money? It can only come from four areas:
Modernization, quality of life, force strength, and readiness. So I
asked each one. They said, ``We can't take it out of any of those
because we are underfunded if all four areas.'' They said at one time
that it was going to cost another $2 billion in 1 year to bring us up
to meeting the minimum of the expectations of the American people to
protect America on two regional fronts.
So we have the recommendations. They said, ``All right. If you have
five ALC's located in Georgia, Oklahoma, Utah, Texas, and California,
we will select two of those to close.'' And they used the criteria to
operate more efficiently. And we could get into 2 or 3 hours of
discussion on how this process works, and how they used the criteria in
evaluating the effectiveness of various installations. They came up
with the conclusion that we are going to have to close two, and those
two should be McClellan and Kelly in California and in Texas.
When you do that, you redistribute that so that workload goes on to
the remaining ALC's. Of course, that will increase the number of jobs
in other States. I understand that. But, if you do not do that, you
will still be operating five ALC's at 50 percent capacity. The only
difference is they will be owned--two of them--by the private sector.
You still have the same problem that existed.
So, if you look at what the alternatives are and look at what we have
gone through in the committee process, you will see that we have really
given in a lot. I suggested to the Senator from Texas that it was the
QDR--Quadrennial Review Defense--review that we went through, and the
Secretary of Defense came in, and said, ``We think that we should
change 60-40 to 50-50.'' He made some other recommendations. He said,
``We also need to have two more BRAC.'' It so happens that the Senator
from Arizona, Senator McCain, said, ``I think we ought to change it to
50-50.''
So we sat down, and worked it out. And we agreed to do that. So there
have been compromises during this process. We debated this. We went
through the whole committee system. We came out, and finally said that
even though as individuals it is going to be politically very difficult
as it is, and every time you shut down a military installation--we have
done over 100 of them so far--it is always difficult to do. It is
difficult for the local House and Senate Members. But it has to be
done. So the committee voted unanimously to do that.
Some people have suggested that the GAO report is not accurate. We
actually had the committee meeting where we had the GAO people there.
We said, ``We want you to be sure that we understand you correctly.
You are saying this is going to cost $468 million. Do you still stand
by that today?''
They said, ``The data, as near as we can determine, indicates that
that is what the cost will be.''
I said, ``Have you considered everything; privatization in place?''
They said, ``Yes, we have considered that. That is part of the
report.''
So we have an extensive report right here by the GAO that comes up
with these conclusions. Some people have suggested that perhaps it was
not a part of that report. I will quote something from the report.
According to GAO, ``The cost to operate the other depots at 50-percent
capacity will far exceed any projected savings through public-private
competition, $468 million. This fact begs the question: What is the
real objective of public-private competition? The only feasible answer
is to save jobs, and Texas and California are to appease the private
sector appetite for new business. Neither is an acceptable answer.''
So we did this. We went through this thing. We looked at what the GAO
was recommending, and decided that we were going to have to do that.
This hearing that we had lasted about 3 hours. They said there is no
question about the fact that we are going to have to do something to
build the others up to a reasonable respectable capacity.
So that gets into the next issue. ``What is the respectable capacity
of the remaining ALC's in order to have this logistics system function
in a prudent manner in the United States?'' GAO said somewhere between
75 and 85 percent.
You might ask. Why not get them up to 95 or 100 percent? The reason
is very clear. If something should happen that we should have to go to
war, we are going to have to have that excess capacity to take care of
the needs to meet the new threat that is out there.
That sounds very reasonable. So we have left it there. It is not
exactly the same in the House bill as the Senate bill. In the House
bill it was 80 percent, and in the Senate bill it was 75 percent--75
percent because Senator McCain thought that 75 percent would be a
better number.
So again, we caved in a little bit on that. So we are now talking
about what to do with this and whether or not we should allow this
process to be violated for the first time.
I would just suggest to you that almost every State has had to
undergo the closure of some type of installation. It would be very
difficult.
I saw Senator Sessions walking through here just a minute ago. For
him to go back to the State of Alabama and say that we now are going to
go ahead and make an exception, and they would say, ``Wait a minute.
Why wasn't the exception made in Alabama, in fact, where we really
wanted to keep our bases open?''
So it is difficult when you lose jobs. We have had to bite the bullet
and go through this. A majority of the Members of this U.S. Senate have
had to go through with that.
Mr. President, there has also been some discussion that perhaps they
left an option open. I know several people who for political reasons
would like to believe that there is another option that is out there,
and they clearly said they had been closed out.
Let me read a couple of the things that I think are necessary for us
to understand. If it had been the intent of the BRAC Commission to
leave an option to privatize in place, they would have said there is an
option to privatize in place. In the case of 1993 BRAC round in Newark,
the Newark Air Force Base, they said, ``The workload can either be
contracted out to one or more of several existing manufacturers, or
privatize in place.''
They said in the 1995 Naval Service Warfare Center in Louisville,
``Transfer workload equipment and facilities to the private sector for
local jurisdiction, as appropriate, if the private sector can
accommodate the workload on-site.'' That is privatization in place on-
site. But what they clearly intended in this case was not to have
privatization in place--not to leave the jobs on site because they want
to consolidate them.
Last, I want to mention that this should not be a jobs issue. This is
a national security issue. The whole reason, Mr. President, that we
came up initially on this 60-40, which was a ratio--it was arbitrary,
and I am the first one to say that it is arbitrary and needs to be
changed at a date when we can correct the national security
ramifications of this issue. But until then
[[Page S5909]]
we are trying to keep some type of a ratio in place that would allow
the public sector to be able to know that in case of war we are not
going to be held hostage by one supplier.
That is the big issue. Should that be 60 percent? I was willing to go
50 percent. But I think a better solution is to do what we did in this
bill. We have a good bill. In this bill for the first time we have
defined what core is. Core is for those functions that are performed
that are necessary for us to defend America. That is a fairly simple
definition. But that is it.
So, if we define core, then we say that we are going to have to do
the core work on site. That would solve the problem. We wouldn't be
talking about 60-40 or 50-50.
So I made a commitment to Senator McCain that, if we can go ahead and
drop the 50-50, let's give it a couple of years. Let's allow them to
see how this works with our new definition of core, and see if we can't
solve it that way and get away from this somewhat arbitrary type of a
formula.
So the real issue here is twofold, I would say. One is we have
involved a lot of money, and, if we do not do this, we are going to
have to come up with it somewhere. It is going to be a very costly
process if we agree that we are going to violate the intent and the
letter of the BRAC.
No. 2, this is even more important than just the money; that is, we
are talking about defending America. We are talking about having a
capability in the public sector to be able to have air logistics
centers. That will keep our airplanes in the air, and will keep our
soldiers fighting in the event that war comes up.
People would like to say there is not that threat out there. I am not
going to go into my normal speech that I make when we talk about this.
I have to tell you. I look wistfully back to the days of the cold war
when we had one other superpower, and our intelligence knew pretty well
where they were. We knew what threat was out there, and we defined that
threat. We could predict how the Soviets were going to act. That is not
true anymore. We have some 25 nations that have weapons of mass
destruction. We have a country that was just written about in
yesterday's newspaper in the Washington Times that the Chinese now are
selling more and more technology in systems to deliver those weapons of
mass destruction to countries like Iran.
So we are faced not with just one single predictable superpower who
poses a threat to us but also to many, many powers out there.
So as a member of the Armed Services Committee, as chairman of the
Readiness Committee, I can say that the big issue here is we have a
country to defend and as difficult as the process is, as difficult as
it is to go through, as upset as I am with the President for
politicizing this in August 1996, nonetheless, we are going to have to
try to stay as close to the recommendations as possible. Because, if we
violate it just one time, I can tell you right now it is not only going
to be the Senator from Georgia who said, ``If we do not go ahead and
carry out the recommendations of the 1995 round, I am going to oppose
any future BRAC recommendations.'' I can assure you that I will do the
same thing. I imagine the majority of the Members of this Senate are
going to come up with the position that if we do not carry out the
recommendations that were clearly identified in the 1995 round that we
are not going to have any more base closure rounds.
So for the time being, I yield the floor, and will stay engaged here.
Mrs. HUTCHISON. Mr. President, I want to talk about some of the
issues that have been raised by my colleagues, because it seems that
there are some very important issues that need to be clarified. A lot
has been said about the integrity of the Base Closure Commission
process. In fact, it is so important that everyone understand we are
protecting the integrity of the base closing process.
I want to read the language that comes straight out of the commission
recommendation:
The Commission finds the Secretary of Defense deviated
substantially from the force-structure plan and final
criteria 1, 4, and 5. Therefore, the Commission recommends
the following: realign Kelly Air Force Base including the Air
Logistics Center. Disestablish the Defense Distribution
Depot, San Antonio.
This is the important language:
Consolidate the workloads to other DoD depots or to private
sector commercial activities as determined by the Defense
Depot Maintenance Council.
Mr. INHOFE. Will the Senator yield on that point.
Mrs. HUTCHISON. That is the BRAC recommendation.
Mr. INHOFE. Will the Senator yield on that point.
Mrs. HUTCHISON. I would be happy to yield.
Mr. INHOFE. I would ask the Senator from Texas to read the next
sentence in that report. If she does not have it, I have it. If she
does, I would appreciate it.
Mrs. HUTCHISON. Mr. President, I think it is important we look at
this language. I have it right here:
Consolidate the workloads to other DoD depots or to private
sector commercial activities as determined by the Defense
Depot Maintenance Council.
The rest of it:
Move the required equipment and any required personnel to
the receiving locations. The airfield and all associated
support activities and facilities will be attached to
Lackland Air Force Base.
Mr. INHOFE. I thank the Senator.
Mrs. HUTCHISON. It is right there. The important part of this
recommendation from the BRAC Commission report is that the option is
given to the Department of Defense through the Defense Depot Maintenace
Council to move the workload to other depots, yes, or to privatize. The
option is given because the Base Closure Commission understood that it
was important for the Defense Department to have the flexibility.
In fact, to augment that argument, I want to read a letter from the
Chairman of the Base Closure Commission. The letter says:
The Commission believes reducing infrastructure by
expanding privatization to other DoD industrial and
commercial activities will reduce the cost of maintaining and
operating a ready military force. Privatization of these
functions would reduce operating costs, eliminate excess
infrastructure and allow uniformed personnel to focus on
skills and activities directly related to their military
missions.
He goes on further to say:
It is my view and the view of the Commission's general
counsel that the commission's recommendation in the case of
both McClellan Air Force Base and Kelly Air Force Base
authorizes the transfer of any workload other than the common
use ground communication electronic workload to any other DOD
depot or to any private sector commercial activity, local or
otherwise, including privatization in place.
Signed Alan Dixon, Chairman, Base Closure Commission.
A letter signed by four other members of the Base Closure Commission,
which would make a majority with the Chairman:
It was our clear intention to provide the Department of
Defense with sufficient flexibility to maintain readiness,
make optimum use of scarce resources and to exploit the
strength of the United States commercial sector where
possible, where doing so would provide the best economic
value to the Government. The department has access to all of
the relevant information and is in the best position to
decide which option best fits its needs.
They are saying clearly they do not expect the U.S. Congress to make
that decision. They think the Department of Defense is in the best
position to decide which option fits best. They go on to say:
The Commission felt that privatization was a key tool the
Department of Defense could employ to achieve significant
savings. As members of the 1995 Base Realignment and Closure
Commission, we support the department's efforts to remove
legislative restrictions which are arbitrary and undermine
effective depot maintenance management.
Signed Rebecca Cox, Benjamin Montoya, J.B. Davis, and Josue Robles.
That is in addition to the Chairman, Alan Dixon. It is very clear the
intent of the Base Closure Commission, along with the actual wording,
that privatization must be an option for the Department of Defense to
be able to use the precious defense dollars for readiness of our
country rather than wasting taxpayer dollars by artificially having
mandates that 60 percent of all maintenance must be done in a public
depot. That is what we are arguing about today.
Now, the Senators have said that we have gone down to 50 percent from
60 percent, and they say that is an accommodation. At 50 percent, you
are still
[[Page S5910]]
mandating that there not be competition, that the Department of Defense
not have the flexibility to do the job it needs to do in the most
efficient and best way, and to save those defense dollars for
readiness.
In fact, I will quote to you from the people who are responsible for
our readiness and their view of this issue. Admiral William S. Owens,
the Vice Chairman of the Joint Chiefs of Staff, retired, is talking
about the importance of the fixed-costs versus the variable costs:
The world's largest business--
The defense business, the Defense Department--
is 65 percent fixed costs and 35 percent variable costs.
The variable costs, the 35 percent, translate to the war-fighting
capability, but the money is in fixed costs.
So what they are trying to do, according to Admiral Owens, is reduce
those fixed costs.
So he says, in order to reduce fixed costs, he believes they must
have privatization. He says he would eliminate a particular percentage
split and let the core work be decided by the services according to
their needs.
Dr. John White, Deputy Secretary of Defense:
Privatization provides substantial savings. As we go
forward, we have a situation where we have to emphasize
modernization.
Dr. White is saying we need flexibility to run this Department so
that we can fight wars, and we need to save it where we can, and
privatization provides savings.
General Shalikashvili, our sitting Chief of the Joint Chiefs:
I believe we must get on with privatization outsourcing.
This is from March 6, 1996, testimony to the Defense Appropriations
Committee:
We need your support to make the hard choices and the
changes to make these initiatives work. I particularly ask
for your support where changes in law are required.
The changes in law he is asking for is to do away with 60-40 or 50-50
so that they can have the full ability to decide what is core workload,
what can be done in the private sector and how they can save money so
that our money will go to, be able to go into the equipment that
protects those young men and women who are out in the field who have
given their lives to protect our freedom.
In response to a question, General Fogleman, on March 14, 1996, said
in answer to the question, how can the services close the $20 billion
procurement gap that they face in trying to cut costs, one word:
``Privatization.''
General Viccellio, who was in charge of the depots, testified May 7,
1997, he needs the flexibility to privatize. DOD, he says, doesn't want
to privatize everything, but they want the flexibility where they know
they can do better.
So, Mr. President, not only are we keeping the integrity of BRAC,
which states in their recommendations they are leaving the option to
the Department of Defense to move the workload to depots or to
privatize, not only is it in the writing of BRAC, but it is augmented
by letters signed by a majority of the members of the Base Closure
Commission, who very specifically say to restrict privatization options
would be wrong.
That is further augmented by the Vice Chief of the Joint Chiefs, by
the Chairman of the Joint Chiefs, and by the Deputy Secretary of
Defense. I did not read to you the testimony from the Secretary of
Defense, both William Perry and Bill Cohen. They all say if we are
going to do the job you are giving us to do, which is cut costs yet
remain ready and do the best for our troops, we need the flexibility to
privatize. And yet the authorization bill that is tried to be brought
up, which we are objecting to being brought up, continues to keep Kelly
and McClellan from being able to bid in a public-private competition,
to have the most efficient use of taxpayer dollars. They would prevent
the ability to have the competition, and instead say it does not matter
if we waste taxpayer dollars; it does not matter if the Department of
Defense has testified they do not want to do it; we are going to force
them to do this work in one of the depots.
Mr. President, it does not make sense. It does not make common sense.
It does not make money sense. And we are going to try to come to an
accommodation so that the depots feel that they will not be threatened.
I do not want them to be threatened. But I do want what is best for the
taxpayers. I do want the Department of Defense to make this decision
based on the facts and based on what is best for the Department of
Defense, and I think they are in the best position to make this
decision. And that is what I am fighting for today.
It has been stated that the GAO report says you cannot have savings
by doing the privatization in place, and I think it is most important
that we say for the record that the GAO has never taken into account
bids in competition. They have told me that, and we must have the
ability for the Department of Defense to take the bids so that we will
know if we are going to be able to have the savings.
So, Mr. President, I am trying to stand today for the integrity of
the BRAC process. BRAC recommended privatization as an option. That has
been thoroughly augmented by the majority of the members of the BRAC in
letters since the closing of the BRAC. It has been augmented by every
important military leader who has testified before the Armed Services
Committee or the Defense Appropriations Committee. There is unanimity
in the Department of Defense that they need this flexibility in order
to use the millions of dollars that they can save by doing this work
privately and put it in the readiness area.
I have to say I am somewhat amused to hear privatization used as if
this is un-American. Who makes the aircraft? Who makes the engines? I
believe private companies make those. Why would we be against the same
private companies that manufacture the engines, that manufacture the
aircraft, repairing them? I really do not understand that argument very
well.
I think the Department of Defense is in the best position to know if
they are, in fact, the best people to repair the engines that they
built or repair the aircraft that they built, and I think we should let
the experts make that decision. That is what we are fighting for today.
We are fighting for public-private competition, we are fighting for
integrity of the BRAC process. We are fighting for the experts to be
able to make the decision of where those precious defense dollars would
go.
We are on the side of the right, and I hope we can work with those
who are trying to protect three depots--which I want to be protected as
well. But they don't have to be protected against competition. They
don't have to be protected in the name of artificial constraints on the
Department of Defense to be able to make decisions. They should be
protected because the Department of Defense wants them to be there. I
am ready to pass a law saying protect them. But I am not willing to
pass a law saying you cannot have public-private competition by the
Department of Defense even if that is the decision that the Department
of Defense makes, because they know best, they are the experts that we
have trusted to make these decisions, and we are trying to uphold the
integrity of that process.
Mr. INHOFE addressed the chair.
The PRESIDING OFFICER (Mr. Coats). The Senator from Oklahoma.
Mr. INHOFE. Mr. President, I have some comments to make in response
to the very eloquent comments of the Senator from Texas, but first I
ask if she would answer one question that I have. I think it is
probably the most important question that could be asked, in these
terms. We all understand. Although the Senator is not on the Armed
Services Committee now as she was last year, she knows the significance
of an authorization bill. I think we all agree that this, the defense
authorization bill, which the Senator presiding right now was a very
important part of, is a very significant bill.
While she gives a compelling case--and I know it comes from the
heart--on privatization, on changing what our interpretation of what
the BRAC recommendations are, would she be willing, in order to protect
the authorization bill, to go ahead, let's take the bill up in the form
that it is and offer an amendment to strike that provision that she
finds objectionable so we can then isolate that one problem and still
have an authorization bill, not hold the
[[Page S5911]]
entire authorization bill hostage, which I am sure she would agree
would not be in the best interests of the country? Would the Senator be
willing to do that?
Mrs. HUTCHISON. Mr. President, let me say this is the first time in
this entire process that anyone has tried to get a fair solution to
this issue. We were not able to do that last year in the armed services
authorization bill, and we certainly do not have a bill that would
allow for good public policy before us today. It is not as if the
Department of Defense would go without appropriation if there was not
an authorization bill because, in fact, many departments of Government
go forward if there is no authorization as long as there is an
appropriation. So there is no ongoing issue of the Department of
Defense not having the ability to do its job and the money being there
for them to do it.
We are talking about a budget that starts on October 1 of this year,
so we have time, and I think we need to take the time. I think we need
to solve this problem in the best interests of the people of America,
our armed services, our Department of Defense and all of the depots
that we would like to protect. I think we have time to do that and do
it right. I do not think it is in the best interests of our country to
go forward with a bill that has such a flawed policy that will have
such far-reaching implications and one in which I am not sure, because
of parochial interests, we will be able to amend unless we are able to
make an agreement before we take the bill up for consideration.
What I am hoping is that before October 1 of this year, the members
of the depot caucus will work with us in sincerity for something that
they think is fair, that we think is fair, that is fair to the
taxpayers, that is fair to the Department of Defense, and that we can
go and negotiate and stand for together. Because, if we can stand
together on something that is right, we will win and it will be better
for America.
So, we have time. Let's do it right. I thank the Senator for the
question.
Mr. INHOFE. I thank the Senator from Texas for that answer, but it is
really a shorter answer I was looking for. That is, would the Senator
be willing to take up her issue, that which she finds objectionable
about the defense authorization bill, and debate that thoroughly on the
floor--and if she is more persuasive or has a better case, then, of
course, she would prevail on that--instead of blocking the entire
authorization bill? This is my concern. The Senate is different than
the other body that I served in for 8 years. Over there, you cannot do
that. But in the Senate I guess one person can just block a bill from
being passed. I hope the Senator from Texas would consider offering her
position as an amendment to strike the language that was put in by the
committee.
I will not ask for a response now, but I hope she would consider
doing that.
Mrs. HUTCHISON. Mr. President, I would like to respond, if the
Senator from Oklahoma would allow me to?
Mr. INHOFE. Of course.
Mrs. HUTCHISON. This bill goes into effect on October 1, 1997. I
would like to see sincerity on the part of the Senator from Oklahoma to
work on this. Let's get a fair agreement so all of us can be together
on this floor fighting for what is right for America, what is right for
the Department of Defense, what is right for our young men and women
who are defending this country. We have time to do it right. Let us do
it right. Because he is correct, in the Senate we do not treat people
the way they treat people in the House sometimes. In the House, they
run over people. Normally, we have not done that in the Senate. That is
why the rights of the minority in the Senate are protected.
I think it is very important that we work together on this issue. I
think we have an incentive to do it. We have plenty of time, and when
we can come to a fair accommodation, I hope we can all work together on
a bill that is good policy for America and allows us to use the
precious defense dollars that we have for the readiness of our country
and for the quality of life for our troops.
Mr. INHOFE. I thank the Senator from Texas. She brings up a very good
point, and that is we are in the middle of a process now that is very
complicated. First of all, we have our defense authorization bill. It
is very, very significant that we get this passed because we have pay
raises for those people who are serving right now in Bosnia and other
places. We have military construction projects that, if we do not pass
this authorization bill, can be in jeopardy. This goes far beyond depot
maintenance. I just hope, instead of holding up the entire
authorization bill, that we could address this in a way where an
amendment could be crafted by the Senator from Texas that would take
out the offensive language and then debate it openly, for hours and
hours. Because these are critical decisions.
I have to respond to a few things that were said. First of all, the
idea of privatization in place--no one is going to exceed my efforts
for the past 30 years for privatization in place. I can remember when I
was mayor of the city of Tulsa, I was privatizing everything that would
not move. I remember our trash system--we privatized it in place. Of
course, people do not like change. I can remember they ended up dumping
in my front yard. However, now it is the greatest system we could have
had--privatization in place.
There is a big difference between privatizing a trash system and
privatizing a core responsibility of the military. So here we are
trying to defend America and putting ourselves in a posture where, if
we follow all the way through with the privatization argument and
privatize everything in the military, then we would not have a core
capability within the public sector to defend America. That is clearly
what this issue is all about.
I would also like to talk a little bit about the committee process
that we have gone through. The Senator from Texas talks about the
committee perhaps not coming out with the right conclusions. We have
been going through this every year. Certainly I, when I was in the
other body, sat through this process. Am I happy with it? No. I would
like to have a better process. The committee process is a very
difficult one and it is one of compromise. We have compromised.
In this process our committee--first of all, in the Subcommittee on
Readiness we discussed this issue, we aired it. It was not partisan. It
was not Republicans versus Democrats. It was how can we address the
issue of having enough of the critical workload, core workload in the
public sector so we know if a war comes up we will not be in a hostage
situation by one supplier or one contractor who might be in a position
to undercut the public sector a little bit at the present time. That is
really what it is about.
So we discussed this and we aired this in committee. I see now that
Senator Thurmond, the chairman of the committee, is here in the
Chamber. I am just reminded that, back when it was very difficult for
the Senator from South Carolina to comply with it, they came along and
closed, in the 1993 BRAC round, the Charleston naval shipyard. He does
not have to answer this question, but I can tell you right now he was
not very happy about that. But he bit the bullet and said we have to
eliminate excess capacity.
I can say the Senator who is presiding right now, Senator Coats--Mr.
President, you can remember when you had to close Fort Benjamin
Harrison in Indiana. Was that fun? No, it was not fun. But you were
very strong at that point and said we have to protect the integrity of
this nonpoliticized process and close excess capacity. There is hardly
a Senator in here who did not have to bite the bullet. All of a sudden,
we are saying the system is not good and we are going to have to ignore
the BRAC process for facilities in two States. There are 50 States.
There are still 50 States. This is just two States we are talking
about. So we went from the subcommittee into the committee, and Senator
Thurmond will remember that we debated this hour after hour. We had
amendments that were offered that would strike the language that we put
in, saying in order to protect the integrity of the BRAC system, we
have to close two of the ALC's and move that workload so others are
going to have at least 75 percent capacity. The House said 80 percent,
the Senate said 75 percent, and we debated that. We had some votes that
were really close votes.
[[Page S5912]]
If you remember, Mr. President, we debated these and had the votes,
and then there were amendments that were offered, and in the final
analysis, we came out and said this bill is a good bill. This bill does
things we have been trying to do for a long time. We have been trying
to define what is core. Always before we have had a very loose
definition that the DOD has used, and that has been acceptable, and we
took their definition and put it into this bill so we will have a
definition of what is core, what is necessary to be performed by the
public sector in order to protect us in times of war so we do not
become dependent upon some outside contractor.
So we have that definition in there. We also have another compromise
that I made, and that is, one of the reasons--in a minute I am going to
talk about the bidding process--we can't have any kind of bidding on
this thing that is fair to the public sector is because they cannot do
the same things the private sector can do. So we put in a teaming
provision. That is to say that the public sector can do what the
private sector can do. Let's take Tinker Air Force base in Oklahoma
City. If Tinker Air Force base wants to compete for some of the
workload that private contractors in Texas are currently trying to
hold, they cannot subcontract out or have teaming arrangements with
other subcontractors on work that they would like. In this bill, when
we pass this authorization bill, we put a provision in here that says,
yes, they can go ahead and contract out. So, if they find the private
sector can do one particular function or one product more efficiently
than the public sector can, then they can go ahead and do that and that
work will be counted as public work in any formula.
That is a great concession, and it is one I don't mind making,
because in that situation, the private sector could do the work, but we
could not be held hostage because the public sector would control the
contracting out of that work. They want to do it. There is not an ALC
in America that doesn't want to have the capability of contracting out
small parcels that might be better done while they can still protect
the core condition or concern that is there.
We have things such as bundling in a package. I can tell you right
now that if they continue the way they are doing it right now in trying
to induce competition for these core responsibilities, that they are
going to win. You cannot compete when you are operating on a playing
field that isn't level.
Right now they can bundle it, and they have bundled these projects,
for example, in Texas, so that only those in Texas could come out
realistically and win this thing.
In our statutes, we have depreciation schedules, where the private
sector can use a different schedule than the public sector. We have
another provision, which I don't disapprove of, which is one that I, as
mayor of Tulsa, actually had the opportunity at one time to participate
in, and that is when they decided that Air Force Plant No. 3 in Tulsa,
OK, was no longer inventory that the Air Force wanted and wanted to
have to keep up, we went through this process, the process of divesting
ourselves of inventory we do not want: First, we let the Federal
agencies look at it to see if they want it. If they want it, it is
taken up there. If not, it goes to the State, and if not there, it goes
to the local communities and counties.
In the case of Air Force Plant No. 3, the city of Tulsa ended up with
it. What can we do now? We can take that and, at no cost, offer it to a
contractor to go out there and compete. This is, I suggest, exactly
what can happen and will happen if they are successful in what they
call competition down at Kelly for some of the ALC work. They would be
able to pick up that base that is closed, that resource worth many,
many, many millions of dollars, give it, for all practical purposes, to
a contractor. That contractor can submit a bid and bid against any of
the remaining ALCs at no cost for overhead.
So here we are in Utah or Georgia or in Oklahoma saying we are going
to have to pay for all of this overhead in our bid, we have to account
for that some way, and they get something free. No, we can't bid. I
don't care if we gave them a 20-percent advantage, there is no way we
could do that, and we shouldn't be talking about that anyway because
the issue here is national defense. Are we going to be capable, Mr.
President, of defending America, of handling those core issues and
concerns within the public sector?
I have to share something, because the very eloquent Senator from
Texas quoted a number of people, and I would like to suggest to you,
Mr. President, that of the eight members of the BRAC committee, only
one who came out for privatization in place as something that is
reasonable. I would like to read to you what some of the other
Commissioners said. This comes from Commissioner Steele. She said:
The Commission was, in general, supportive of privatization
of DOD industrial activities where appropriate. However,
privatization as a concept and forced privatization in place
of what is clearly excess depot capacity are two very
different issues.
In the specific case of Sacramento and San Antonio ALCs,
the Commission was very aware that we were recommending the
closure of two very large industrial activities. The
Commission's recommendation to consolidate these workloads,
other than common-use ground-communication and electronics
work, ``to other DOD depots or to private sector commercial
activities as determined by the Defense Depot Maintenance
Council. Move the required equipment * * * to the receiving
locations''--
``To the receiving locations,'' that means a location other
than Kelly Air Force Base and other than McClellan out in
California, because you still don't resolve the problem, if
you merely privatize in place and end up with five, so to
say, ALCs all operating at 50-percent capacity.
Forced privatization in place of all of the workload is
contrary to the intent of Report language.
She says, further reading toward the end of the letter:
The Commission clearly did not intend to privatize in place
all of the workload from the 2 ALCs we voted to close, as
noted in our Findings, ``closure * * * permits significantly
improved utilization of the remaining depots and reduces DOD
operating costs.'' Where the Commission encourages
privatization in place, our Report addresses it directly * *
*
And she cites the page numbers.
Such was not the case with the ALCs.
Finally:
If any Commissioner had offered a motion--
Listen, Mr. President--
If any Commissioner had offered a motion to privatize in
place, as the President proposes, I am 100-percent certain
that such a motion would have been defeated handily.
This is Wendi Steele, a Commissioner who went through all the
processes. I won't go through the whole letter from Commissioner Lee
Kling, but I will read the last paragraph of his letter. Now keep in
mind, these are two of the eight Commissioners. We have letters from
all but former Senator Dixon.
He says:
The Commission's review clearly documented significant
excess capacity in the five Air Force Air Logistic Centers.
Privatization in place of all of the workload of Sacramento
and San Antonio Air Logistic Centers could result in little
or no savings to the Air Force by the closures. Further, it
might result in privatizing excess capacity rather than
eliminating it and could also miss the opportunity to improve
the efficiency of other DOD depots by increasing their
utilization.
Mr. President, I ask unanimous consent to have these letters from
Commissioner Wendi Steele and Commissioner Kling printed in the Record.
There being no objection, the letters were ordered to be printed in
the Record, as follows:
The Defense Base Closure
and Realignment Commission,
Arlington, VA, September 21, 1995.
Hon. J.C. Watts, Jr.
U.S. House of Representatives,
Washington, DC.
Dear Representative Watts: Thank you for your letter of
September 15 and questions regarding the issue of
privatization in place for the workload of the Sacramento and
San Antonio Air Logistics Centers.
The Commission was, in general, supportive of privatization
of DoD industrial activities where appropriate. However,
privatization as a concept and forced privatization in place
of what is clearly excess depot capacity are two very
different issues.
In the specific cases of the Sacramento and San Antonio
ALCs, the Commission was very aware that we were recommending
the closure of two very large industrial activities. The
Commission's recommendation to consolidate these workloads,
other than common-use ground-communication and electronics
work, ``to other DoD depots or to private sector commercial
activities as determined by the Defense Depot Maintenance
Council. Move the required equipment . . . to the receiving
locations'' was intended to move that workload to the most
cost-effective and operationally sound location after
[[Page S5913]]
closure of the ALCs and elimination of that capacity.
We felt that the Depot Maintenance Council, rather than the
Air Force. Would be in the best position to proceed in good
faith to maximize efficiencies by determining what portions
of that workload should be interserviced, moved to another
ALC or transferred to the private sector (not necessarily
``in place''). Forced privatization in place of all of the
workload is contrary to the intent of our Report language.
The only instance I am aware of the Commission specifically
discussing the possibility of significant ALC privatization
in place, or a government owned/contractor operated facility
(GO/CO), was the C-5 work at Kellly (excluding engines). That
would assume it could be accomplished by a private contractor
at that location for less than the savings and efficiencies
which would be realized by moving it. By all of our measures,
it appeared that the long-term savings to DoD would be
substantial by moving that workload to another ALC, but we
did not want to pre-determine the outcome of a complete and
fair analysis by the Depot Maintenance Council, which the
President's proposal disallows.
Though the Commission did not direct the engine work to
move to another ALC, our Findings state, ``The Commission
urges the Air Force to consolidate engine maintenance
activity at Tinker to reduce excess capacity. The Commission
firmly believes that consolidation of engine activities will
result in lower costs and increased efficiencies.''
Privatization in place of all the workload of the 2 closing
ALCs would enhance our national security posture only when:
Moving the work to another DoD depot or to a private activity
would have unmanageable operational/readiness risk; the costs
to move the work would outweigh the long-term efficiencies
and savings which would be realized (capacity utilization,
reduction in overhead, etc.); or a truly unique capability or
strategically important redundancy would be lost or unable to
be cost-effectively replicated elsewhere in the public or
private sector.
It's important to remember that both DoD and the
Commission's review clearly documented significant excess
capacity in the 5 ALCs. Privatization in place of all of the
workload of Sacramento and San Antonio would result in
shifting excess capacity to what appears would be a
competitively protected segment of the private sector rather
than eliminating it, and further, would miss the opportunity
to improve the efficiency of the other DoD depots.
The Commission clearly did not intend to privatize in place
all of the workload from the 2 ALCs we voted to close, as
noted in our Findings, ``closure * * * permits significantly
improved utilization of the remaining depots and reduces DoD
operating costs.'' Where the Commission encouraged
privatization in place, our Report addresses it directly (see
pgs. 1-58 to 1-61). Such was not the case with the ALCs.
Moreover, not allowing the remaining ALCs--all of which
ranked higher in military value--to compete for the
additional workload, will cause them to become increasingly
less cost-competitive in the future. Even beyond common sense
issues of most effectively utilizing our limited defense
resources, I am at a loss to understand why it would be in
the Air Force's best interest to protect its lowest ranking
depots at the expense of its 3 superior installations.
As difficult as it was to vote for the closure of 2
facilities of this size and quality, the Commission voted 6-2
to do so because we felt that it was in the best interest of
the Air Force, DoD, and the American taxpayers. If any
Commissioner had offered a motion to privatize in place, as
the President proposes, I am 100% certain that such a motion
would have been defeated handily.
Representative Watts, I hope I have answered your
questions. Please feel free to contact me if I might be of
further service on this or any other matter.
Highest regards,
Wendi L. Steele,
Commissioner.
____
S. Lee Kling,
St. Louis, MO, September 29, 1995.
Hon. J.C. Watts, Jr.
Congress of the United States, House of Representatives,
Washington, DC.
Dear Congressman Watts: Thank you for your recent letter
concerning the issue of privatization in place for the
workload of the Sacramento and San Antonio Air Logistics
Centers. I certainly understand your interest in this
question.
As Chairman Dixon noted in his July 8 letter to Deputy
Secretary of Defense John White, the Commission was generally
very supportive of the concept of privatization of DoD
industrial and commercial activities. This is consistent with
the May, 1995 Report of the Commission on Roles and Missions
of the Armed Forces, which concluded that ``with proper
oversight, private contractors could provide essentially all
of the depot-level maintenance services now conducted in
government facilities within the United States.''
Privatization is very beneficial in certain situations but
not all.
In specific cases of Sacramento and San Antonio Air
Logistics Centers, the Commission was very aware that we were
recommending the closure of two very large industrial
activities. The Commission's recommendation to consolidate
the workloads of these two Air Logistics Centers ``to other
DoD depots or to private sector commercial activities as
determined by the Defense Depot Maintenance Council'' was
intended to give the Air Force and the Secretary of Defense
the maximum flexibility to implement the closure of these two
Air Logistics Centers in a way that would eliminate excess
capacity without harming ongoing Air Force operations and
provide the greatest savings. With the exception of the
direction to move the common-use ground-communication
electronics workload currently performed at Sacramento Air
Logistics Center to Tobyhanna Army Depot, the Commission did
not direct any of the workload of McClellan or San Antonio
Air Force Bases to any specific DoD depot or to the private
sector. We felt that the Defense Department was in the best
position to make these judgments.
The Commission's review clearly documented significant
excess capacity in the five Air Force Air Logistics Centers.
Privatization in place of all of the workload of Sacramento
and San Antonio Logistics Centers could result in little or
no savings to the Air Force by the closures. Further, it
might result in privatizing excess capacity rather than
eliminating it and could also miss the opportunity to improve
the efficiency of other DoD depots by increasing their
utilization.
Thank you for your continuing interest in the base closure
process.
Kindest regards,
S. Lee Kling.
Mr. INHOFE. Mr. President, this is taken directly out of the BRAC
language. It is critical that we find ourselves in a situation where we
are going to be able to actively interpret the intent of the BRAC
Commissioners. Eight Commissioners, and they used the same criteria
everywhere they went. They visited all the installations. They were in
Oklahoma. It was very tense. We have five installations in Oklahoma.
They went to all of them. These people worked for years to try to come
up with conclusions, so I am going to read some of the conclusions they
have, and then I would like to yield to the Senator from Georgia, if it
is his desire to be heard on this subject.
Mrs. HUTCHISON. Mr. President, will the Senator yield for one
question?
Mr. INHOFE. Yes, I will yield for a question, and then I do want to
hold the floor so I can conclude my remarks.
Mrs. HUTCHISON. Yes, I understand, and since I was willing to answer
any questions you had, I think that is fair.
Mr. President, I understand that the Senator has read a letter from
one of the Base Closing Commissioners, Wendi Steele. And I just ask if
the Senator from Oklahoma will tell us where Wendi Steele worked just
before she went on the Base Closing Commission?
Mr. INHOFE. Where did she work?
Mrs. HUTCHISON. Yes.
Mr. INHOFE. Maybe you can tell me. I know she lived in Texas.
Mrs. HUTCHISON. Yes, Wendi Steele was actually the defense
legislative assistant for Don Nickles. She is from Oklahoma. I don't
know if she lived in Oklahoma.
Mr. INHOFE. I think she is from Houston.
Mrs. HUTCHISON. But she worked for Don Nickles before becoming a
member of the Base Closing Commission.
Mr. INHOFE. Can I ask a question of the Senator from Texas? During
the time that we approved the appointments by the President of the
eight Commissioners, we went through long hearings. You, at the time,
were a member of the Senate Armed Services Committee, I believe, and I
was there, too. I ask, did you have any objection to the appointment of
Wendi Steele as one of the Commissioners during those hearings?
Mrs. HUTCHISON. As a matter of fact, I was very concerned about the
appointment of a former staff member of a Senator from a State that was
going to be in competition with our State on several bases. I was
concerned about it. I asked Ms. Steele at the time if she would be
willing to recuse herself, since she was on Senator Nickles' staff,
from any of the decisions that would bear on a base that was in
competition with Oklahoma, and she said no. I thought of objecting to
her at the time. I decided that I would not object because I hoped that
she would be fair and open and honest.
I was concerned when, as a member of the Commission, she was doing
the routine tour that Commissioners do of Kelly Air Force Base and she,
at the time, said to the commander of the base, ``This is a really nice
facility. I wonder what we will be able to do here when all of this is
moved to Tinker?''
Now, this was when she was just in the research phase taking the
routine
[[Page S5914]]
trips that everyone takes, and she had made up her mind that this was
going to be moved to Tinker.
So I just think when I read the letters from the five members of the
Base Closing Commission that stated clearly that privatization is an
option that they meant to leave open in these base decisions, I just
wanted the Senator to know what the background was on the letter from
Wendi Steele.
Mr. INHOFE. Let me reclaim my time. Thank you very much, I say to
Senator Hutchison.
Mrs. HUTCHISON. Thank you, Mr. President.
Mr. INHOFE. I appreciate you calling that to our attention. I also,
Mr. President, call to your attention the Commissioner in question is a
resident--was a resident, I assume is still a resident--of Houston, TX,
and she had not been on the staff of Senator Nickles for some time.
I think when we went through this process of determining whether or
not anyone was prejudiced on that Commission, I asked every
Commissioner questions. I asked them: ``Are you going to use the
criteria in an unprejudiced manner?'' And they all responded yes. There
is not one person who objected to Wendi Steele.
I will also say, I also quoted extensively Lee Kling. I don't believe
Lee Kling was ever on Senator Nickles' staff.
I want to yield to the Senator from Georgia, but since it is so
critical we know what the intent was, not just by reading the reports
from the Commissioners, let me just go ahead and read a few things that
actually came from the BRAC commission report. These are quotes, Mr.
President, if you will bear with me for just a moment.
. . . significant excess capacity and infrastructure in the
Air Force depot system requires closure of the San Antonio
ALC.
They addressed separately the question in California. But the point
here is, I keep hearing, don't worry about it, they are already closed.
No one is going to be naive enough to say by closing it, they didn't
fully intend to stop the excess capacity from taking place in Texas and
in California. It was assumed that that would take place.
Second:
. . . closure of the San Antonio ALC and related activities
in Kelly AFB, including the defense distribution depot and
information processing megacenter, permits significantly
improved utilization of the remaining depots and reduces DOD
operating costs.
Third, another direct quote from the BRAC committee:
The Commission found the cost to realign Kelly AFB to be
less than that estimated by the DOD and the annual savings to
be significantly greater than DOD's estimate.
I heard someone, I believe it was the Senator from California, just a
short while ago make a statement--maybe I am not attributing that to
the right person--saying that the GAO study did not take into
consideration relocation. The GAO study clearly did take into
consideration relocation.
Quoting further:
The Commission assumed that a depot closure and
consolidation of work would permit a personnel reduction--
Listen, Mr. President--
of 15 percent of selected ALC personnel and a 50 percent
reduction in management overhead personnel.
Further quoting:
The decision to close the San Antonio ALC is a difficult
one, but given the significant amount of excess depot
capacity and limited defense resources, closure is a
necessity . . . The San Antonio ALC closure will permit
improved utilization of the remaining ALCs and substantially
reduce DOD operating costs.
I could go on all day with these things. There is a lot of redundancy
here. But it clearly expresses to us what their decision was and what
they meant.
The Commission staff presented data indicating large annual savings
could be realized by consolidating engine maintenance activities at
Tinker Air Force Base, OK. Both Kelly and Tinker are operating at less
than 50 percent of their engine maintenance capacity. * * * The
Commission urges the Air Force to consolidate engine maintenance
activity at Tinker to reduce excess capacity. The Commission firmly
believes that consolidation of engine activities will result in lower
costs and increased efficiencies.
Again, Mr. President, there can be no doubt that even if you tried to
isolate certain things that were said or maybe a rumor that was heard
down in Kelly Air Force Base, I do not think we should be talking about
statements that cannot be documented and rumors that someone said this
or someone said something else.
If you just stop and realize, if you have five ALC's operating at 50-
percent capacity, and you close two, and, as the bill calls for, you do
not privatize anything in place there until the remaining, more
efficient--according to the BRAC process--certification of ALC's
located in Oklahoma and Utah and in Georgia are operating at a minimum
of 75-percent capacity, I do not care if it is 65 percent, but the
bottom line is anyone who has any business background knows that you
cannot operate at 50-percent capacity and do so efficiently.
I do not think we need to attack the integrity of the independent
commissioners. I feel that people like Wendie Steele and Lee Kling and
the rest of them have spent time, their valuable time--sure there is
compensation, but there are very few people who would be willing to
take 2 years out of their lives to do nothing but evaluate the
operation of literally hundreds of military installations.
Now, I have a lot more things to talk about. I would like to yield to
the Senator from Georgia. You know, I commented several times, as he
sat in there with us in the Senate Armed Services Committee, that this
not a partisan thing. This is about defending America.
So I yield the floor.
Mr. CLELAND addressed the Chair.
The PRESIDING OFFICER. The Senator from Georgia.
Mr. CLELAND. Will the Senator from Oklahoma yield?
The PRESIDING OFFICER. The Senator from Oklahoma yielded the floor.
Mr. CLELAND. Mr. President, I missed some of the discussion of the
Senator from Oklahoma. I would like to just highlight some points that
I will mention about this discussion.
I say to the Senator, I am a newcomer to this basic issue here, but
you have been involved from the beginning of the BRAC process, all the
way through.
Was it your understanding when this process was set up to close
bases, that that was exactly the intent of the entire process, to
indeed close bases, and that this issue of privatization in place came
along some time afterward as possibly something that was new to the
process and has actually thrown that process off track? Is that your
understanding?
Mr. INHOFE. That is my understanding.
Before the Senator from Georgia got in here, I commented on several
of the States. For example, Indiana, where the presiding office is
from, he lost, and did so with grace, as much grace as he could, a
major installation in Indiana.
Our own chairman, Senator Thurmond, I mean, no one, no one can have
more political influence to stop the closing of a base in his home
State than the chairman of the Armed Services Committee. And Senator
Thurmond was willing to say, all right we have to bite the bullet.
The big issue here is, we need to use the money that is used on
excess capacity to be spent on such things as modernization, quality of
life, on readiness, on force strength. These are the things that we
need to be talking about.
So, yes, the whole thing on privatization in place, it was
anticipated someone might bring it up. So the GAO in their report, when
they came to the conclusion that if you privatize that excess capacity
in place in Sacramento and in San Antonio, it is going to cost the
taxpayers, and I say cost the defense system, because that is what it
is going to come out of--$468 million a year. Over the 5 years, they
said that is $2.34 billion.
In further responding to the Senator's question, I would say, you sat
there in those committee meetings when we had the service chiefs in
there and said, ``Where are we going to come up with the money if we
don't carry out the recommendations of the BRAC system?'' We have to
come up with several hundred million dollars. Is it going to kill the
force stream and quality of life and come out of modernization. ``Where
is it going to come from?'' What did they say? They said, ``We don't
have anything for it to come out of.''
[[Page S5915]]
Mr. CLELAND. I ask the Senator, is it your understanding, if this
privatization in place policy stands--of course, the bill reported out
of the Senate Armed Services Committee does not prohibit privatization.
It just prohibits this policy which has thrown the BRAC process off
track in terms of their logistics centers.
Mr. INHOFE. That is a very good point.
In fact, several people, who would like to have us believe that--
referring to the privatization in place--very conveniently leave out
one sentence when they talk about realigning Kelly Air Force Base,
including the air logistics center. The last sentence says, ``Move the
required equipment * * * [and any required personnel] to the receiving
locations * * *.''
That means not there. Do not privatize excess capacity where you
maintain the problem of having five locations, each operating at 50-
percent capacity. It is very, very clear.
Mr. CLELAND. I ask the Senator, isn't it true that if the action
follows, that is, the privatization-in-place policy, that we have heard
testimony--you and I were in the subcommittee listening to the
testimony from the Air Force--that if you followed the privatization-
in-place policy, rather than just sheer privatization, it begins to
thwart not only the BRAC decision, but it begins to obscure the whole
concept of privatizing to begin with, and that when the Air Force talks
about competition, say, competing for the C-5-A workload, they put
qualifications on it in order to adjust to the privatization-in-place
requirement and require that work to be done for the C-5-A workload at
Kelly, and that absolutely compromises, I think, the whole sense of
competition between an air base, say, like in Warner Robins--it is
going after that workload--and a private contractor?
Isn't it your opinion that if we do not get rid of this
privatization-in-place policy, we will end up with five air logistics
centers, which is not the desire of the BRAC Commission, but three will
be publicly run by the Air Force and two will be private, costing the
taxpayers hundreds of millions of dollars? Is that not right?
Mr. INHOFE. You know, that is one of the three bottom lines here. It
is just so logical that if you have five operating at 50-percent
capacity--as they said in this overdraft quoted out of their report;
they said it over and over again--you have to close two and transfer
the workload.
Now, the whole idea of privatization came up--and I hate to say it,
but it was highly political. We all get political right before an
election. This is what happened right before the election. And it
happened out in California. There are a lot of electoral votes in
California. The administration said: ``We want to privatize in place.''
But clearly you are right. The Senator from Georgia is exactly right.
That does not resolve the problems.
A minute ago I said there are three bottom lines. That is one bottom
line. Another bottom line is the fact that this is a national defense
issue. How can we be sure that if there is a war, if Iran decides they
are going to use some of that technology and the systems they are
getting out of China or Russia and go to war with us, that we are going
to be in a position to fight that war? It is a national security issue
so that if we do get in a war, we will not become dependent, for those
core activities, on a private contractor.
You know, I am all for privatization in place. But that is the other
issue.
The third, of course, is cost. Those who say that GAO did not
consider privatization in place, they did. The GAO was before our
committee. You were there with me. We sat there for several hours. We
cross-examined this gentleman. He said, and repeated over and over
again, ``Yes, the costs. It is going to be to the taxpayers or to the
defense system. We proximate $468 million a year.'' Then I said, ``Is
that old information? Is that new?'' ``No; we brought it up to date.''
So that is their current position. That is their past position. The
GAO was set up to be an independent agency to evaluate these things
free of political interference. They came out with this, that third-
cost thing. The Senator from Georgia knows the problems that we are
suffering from right now in our defense system. He knows that we cannot
come up with $2 or $3 billion and take it out of something that is
existing. So the Senator from Georgia is exactly right.
Mr. CLELAND. I say to the Senator, you and I both sit on the
subcommittee. That point is well-taken, that regardless of some of the
aspects of this issue, which can be kind of arcane, when you start
talking about air logistics centers, the bottom line is, are we going
to fulfill the goal of the BRAC Commission, and that is have three air
logistics centers, lean and mean and working at full capacity and ready
to go in terms of the readiness of our forces? That is the bottom line.
If we compromise the BRAC decision, then we will not have three air
logistics centers lean and mean operating at full capacity really ready
to do their job in a time of conflict and combat. That is one of the
things that really concerns me about this whole issue.
Mr. INHOFE. I respond to the suggestion of the Senator from Georgia
that in capacity, there is potentially enough capacity so there will be
a public depot in the event of war and have some capacity to grow into
it. That is the reason that, again, it is somewhat arbitrary as to
whether it is 75, 80, or 85 percent. The GAO again said that you should
operate the three remaining air logistics centers somewhere between 75
and 85 percent capacity to leave enough capacity so that, as the
Senator suggests, in time of war we would have that capacity and then
we would be at full capacity. Clearly this is a national defense issue.
Mr. CLELAND. I appreciate the Senator from Oklahoma and his
leadership on this point and his concern for readiness of our forces,
readiness of our air logistics centers to do the job, the ability of
those centers to do the job economically and effectively, which in my
reading of the BRAC process was part of the reason for the process even
occurring, and that he marshaled great facts and arguments for the
committee bill here, which I support, which does not eliminate
privatization, it just eliminates an absurd policy that is costing the
taxpayers of this country hundreds of millions of dollars and is
inefficient, ineffective, and ultimately weighs down and compromises
three outstanding air logistics centers.
I just want to thank the Senator for his leadership and his
scholarship on this issue. I will be supporting him on a vote.
Thank you, Mr. President.
Mr. INHOFE. Before the Senator yields the floor, I would like to
respond, in a way. We are talking about this as being a major national
defense issue. That is what it is really all about.
I am deeply concerned because I understand, certainly not as well as
some of the others around here, that the Senate rules do provide that
any one Senator can stop the train, can stop and can kill a bill.
I see Senator Thurmond down there, the chairman of our committee, the
hours that we put into this thing. I just hope that those who disagree
with one small part--this is a tiny part of this bill. We have pay
raises for our guys in Bosnia. We have modernization programs in there.
We have barracks that are starting construction right now that we have
to continue. We have literally hundreds of things that are totally out
of this realm, not associated with the depot maintenance, that are in
this bill.
So I just hope that those who are opposed to this part or any part of
the bill would not use the Senate prerogative that each Senator has to
stop the bill altogether so that we will not have the defense
authorization bill, but merely offer amendments to take out those parts
that they find offensive. I am prepared to debate against such
amendments that might cause this to come out.
So, I just respond by saying, I hope that you share my concern that
we do not want to hold up the defense authorization bill. Let us go
ahead, as Senator Thurmond had suggested in a meeting yesterday and
said we have a good bill here. A lot of good things are in it. If
somebody does not like some provision, they have every right to stand
here on the floor and argue that case and be as persuasive as they can
to take that out. I think that is the process, for the sake of
America's defense, that should be used.
I assume the Senator from Georgia would agree with that.
[[Page S5916]]
Mr. CLELAND. The Senator from Oklahoma is absolutely correct. I
support him 100 percent on that point. And the great chairman of our
committee is absolutely correct; if there is anyone who disagrees with
portions of this authorization bill, offer an amendment to delete it.
But to hold up the whole bill is wrong.
Second, I am the ranking Democrat on the committee that deals with
personnel in the military, particularly with quality-of-life issues.
There are many things in this piece of legislation that we are about to
discuss, like the 2.8 percent pay rate increase in barracks housing and
housing for families on many bases and an increase in aviator pay, to
recruit and retain the best pilots and service men and women.
There are many things in this bill that our soldiers and sailors,
airmen, marines, coastguardsmen out there really need. I hate to see
this bill run aground on this particular point that we have been
debating.
So the Senator is absolutely correct. I support him 100 percent on
that point.
Mr. INHOFE. Of course, the Senator from Georgia being the ranking
member of the Personnel Subcommittee, and Senator Kempthorne, being the
chairman, as I go around and make the base visits, it is very
distressing. You mentioned flight pay.
We are losing our quality pilots to the private sector because there
is a great demand out there. How can we compete, when these guys are
willing to do it? They want to fly the F-16's, the F-14's and the F-
18's, and the equipment we have, the heavy equipment, the B-1's and B-
2's, and so forth, but they also have families and they have children
and we have to provide them with the pay that is somewhat competitive.
We are way below that. However, you are able to get in some provisions
that will, I think, retain some of these pilots.
Right now we are in the middle of an incredible housing shortage and
we have troops on food stamps, we have housing that they would not let
prisoners live in.
We have a lot of improvements here due to your hard work and that of
Senator Kempthorne. To jeopardize all of that work just because of one
small provision--I suggest there are some things I do not like in this
bill. If I do not like them I will offer an amendment to take it out.
That is the process. I just hope we can follow that process.
Mr. BENNETT. Mr. President, do I have the floor?
The PRESIDING OFFICER. The Senator from Utah has the floor.
Mr. BENNETT. I will not prolong this particular debate about depots,
but I was passing through and heard it going on and could not resist
the opportunity to make some comments about it. The issue clearly will
be debated at greater length and I will have more statistics and
information at that time.
The point I want to make in this context has to do with the issues
raised by the Senator from Georgia and the Senator from Oklahoma
regarding readiness and capability in the depots. It is the corrosive
effect of a depot operating at less than full capacity or even
approaching full capacity.
If I may, I will share with the Senate my experience at Hill Air
Force Base where we have the air logistics depot that was rated No. 1
during the last BRAC process. Let it be understood there were five
depots that BRAC looked at, and according to the ratings that were
given these depots, Hill Air Force Base was rated No. 1, McClellan Air
Force Base which BRAC said should be closed was rated No. 5, and Kelly
Air Force Base, which BRAC said should be closed was rated No. 4.
However, the expected shift of workload from Kelly and McClellan to
the surviving three has not taken place. At the Hill Air Force Base
they are now down to about 52 percent of capacity. There has been a lot
of conversation here about how inefficient and expensive that is. I
agree with all that conversation. It is ineffecient and expensive. But
it is more corrosive than that in terms of what it is doing to the
personnel on whom we will depend at some point for support if there is
a war.
The work force at Hill is aging. As people leave, they are not
replaced. Why should they be--the capacity of the base is not being
used, so as attrition comes along and people leave, they are not
replaced. The people who are looking toward retirement in the next 5 to
10 years recognize they will not be replaced if this capacity problem
is not solved. Their morale is down. When they speak to the people in
the surrounding community who might want to apply for jobs, be trained
and acquire the expertise that we will need, the present folk tell
them, quite understandably and logically, ``Don't bother. Don't come to
work here. The Air Force has no loyalty to its personnel. The Air Force
has no loyalty to this depot. They have done everything they can to
close the depot by keeping work spread out at other depots around the
country.''
The time will come, and it will come relatively soon in terms of
international defense issues, that is, within the next 5 to 10 years,
when we will not have a work force at all. These people will have
retired, they will have left, no one will have come in to be trained,
and the Air Force will suddenly sit there and say, who can we get to do
this work at virtually any price, at any place? Depots do not manage
themselves. It takes people. Problems do not get solved by facilities,
it takes people.
The process the Air Force is following in this privatization in place
procedure is corrosive and destructive of not only the morale but the
skills of the people at each one of these depots. We would not have
this problem at Hill Air Force Base if Hill Air Force Base were
operating at 75, 80 or 85 percent of capacity. People would be busy
doing productive, worthwhile things.
Now they are painting rocks--not literally, but figuratively. I have
been in the Army. I know what happens when the drill sergeant has you
for the afternoon and has nothing for you to do. He requires that you
go out in front of the barracks and pick up all the rocks and paint
them and then put them back. That is not a really good morale
experience to go through. I have gone through that. I think just about
anybody who has gone through training in the American military has had
that kind of experience from time to time. You want to spend your time
in worthwhile activities, in real training, but they have you for the
afternoon, they do not have anything for you to do, and military life
being what it is, they will not let you go, so the top sergeant has you
out there painting rocks. Well, figuratively, many of the people at
Hill Air Force Base are drawing their full salary, charging the
taxpayer the full cost, but they are painting rocks. Why? Because the
work they should be doing is still being done on the bases that the
BRAC ordered to be closed.
We can talk about the price, we can talk about the money that is
being wasted, we can talk about the inefficiency, but we should not
lose sight of the corrosive impact on the morale, the expertise and the
ultimate future of the work force that will be necessary to keep this
country alive and strong in the defense in the future.
I hope the members of the Armed Services Committee who address this
issue keep this in mind, along with all of the other issues. We are
arguing about jobs and where they will be. We are arguing about dollars
and where they will be spent. However, we are in an exercise created by
the Air Force's refusal to abide by the requirements of BRAC, that is
terribly corrosive of the work force, and ultimately the readiness
capacity of this Nation.
It is very difficult to measure but that does not mean it is not
real. It is very difficult to pin down in specifics, but that does not
mean it is not serious. It is real. It is serious. It is going on, and
the BRAC process must be implemented as quickly as possible in order to
stop it.
Mr. THURMOND. Mr. President, the Senate has a very able majority
leader. It is his business to take matters up after the committees have
acted and to get action one way or the other. The Senate Armed Services
Committee has brought forth a bill here. It is ready to be acted on.
Why is this delayed? Some Senators are not pleased with what it
contains.
Now, any Senator who is not pleased with any portion of this bill and
wishes to amend it or repeal it has an opportunity to offer an
amendment to do that. But to say to the Senate, we are going to object
to even taking up the bill, even considering the bill, and holding up
the work of the Senate--isn't it reasonable to go forward with
[[Page S5917]]
this bill, let amendments be offered, let them be acted on? That is the
democratic way.
Now, the Senate Armed Services Committee passed this bill out
unanimously. Every member of the Senate Armed Services Committee voted
for it. Every Republican and every Democrat voted for it. It cannot be
too bad a bill in view of the unanimous support it has received.
Again, I repeat, any Member who is dissatisfied with any portion of
this bill has an opportunity to offer an amendment to the bill to their
liking. I hope the objections to going forward with the bill and
considering it will be discontinued and we can proceed with the welfare
of the Senate which is to take up this bill and act on it.
I yield the floor.
Mr. INHOFE. Mr. President, I suggest the absence of a quorum.
The PRESIDING OFFICER. The clerk will call the roll.
The legislative clerk proceeded to call the roll.
Mr. GRAMM. Mr. President, I ask unanimous consent that the order for
the quorum call be rescinded.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. GRAMM. Mr. President, I came down at noon with my colleague from
Texas, Senator Hutchison, and objected to bringing the Defense
authorization bill to the floor of the Senate under unanimous consent.
I then rushed back to the Finance Committee where we were finishing our
markup on Medicare, Medicaid, and welfare reform. I did not have an
opportunity when I raised the objection to explain exactly what all of
this is about. I wanted to come over very briefly and do that now.
Let me say I once had the great privilege of serving on the Armed
Services Committee. I have always been a strong supporter of national
defense. My dad was a career soldier, a sergeant in the Army. I was
born at Fort Benning and I have always had a special place in my heart
for people who wear the uniform of the country. So it produces no great
happiness in my heart being in a position of holding up this bill.
Let me also say that I never like to do anything that brings distress
to the chairman of this committee, Strom Thurmond, who is the greatest
man that I have ever served with in public life.
However, let me explain to my colleagues why this issue is so
important, although I do not want to get into a debate today about the
issue. I am hoping we can work something out. I am hoping that reason
and fairness will prevail, and like everything else in life, if you
look at something from a different perspective, you see it differently.
I do not have any doubt that our dear colleague from Oklahoma in his
heart sees this thing differently than I do. I think one of the things
that has helped me in public life is what an old Virginian, Thomas
Jefferson, once said, ``Good men with the same facts are going to often
disagree.'' So I never try to get personalities involved with issues.
This is about what we want to achieve, in some cases for our States,
in some cases for the country. Let me tell you how I see the issue.
This is an old issue, in the sense that it has been building for
several years. It started in the House with a group called the Depot
Caucus. This is a group of Members of Congress who have depots in their
district. For those who know more about trains than they do about
military maintenance, a depot is a Government-owned facility where
Government employees do work for the Defense Department--primarily work
in maintaining defense systems.
Now, we have had a longstanding debate about whether maintenance work
ought to be done in depots, or whether it should be done by the private
sector. You will hear people argue on both sides of the issue. Some
people will say only these depots can be relied upon to maintain
weapons systems that were built by the private sector, not the private
sector. We have gone through three base closings, and we have now
closed five bases in Texas.
I was an original cosponsor of the base closing commission. I voted
for the commission reports that closed all of those bases. I hated it.
It seemed to me that we were penalizing the very people who won the
cold war, but I understood it had to be done. Let me say to my
colleagues that I am for another round of base closings. We have cut
defense by a third; we have reduced the number of military bases by 18
percent. We have more Army nurses in Europe than we have combat
infantry officers in Europe. Tell me that makes sense. We have a huge
bureaucracy that was built in another era, for another time, for
another conflict. And we all love parts of that bureaucracy. Part of it
is in our State. But it is profoundly wrong for the country, and we
have to have a bureaucracy that fits the military we have now.
So I am not here trying to defend a base in Texas, Kelly Air Force
Base. That is closed. It is closed. The case is over. I voted to set up
the commission that closed it and voted for the report that closed it,
even though I wish we had closed a base in someone's State who doesn't
support defense as much as I do. So the issue we are debating here is
not trying to keep a base open. It is going to be closed. I don't want
to reverse the decision. It is done. I wish it had been decided
differently, but it wasn't.
Now, the issue before us is a very simple issue. The Defense
Department, the Secretary of Defense, the Secretary of the Air Force,
and those involved in procurement believe that we can save tremendous
amounts of money through price competition. Surely, in America, that is
not a revolutionary concept. What the Defense Department wants to do is
to have competitive bidding between the three depots in the Air Force
that are doing maintenance work and private contractors. I should also
point out to my colleagues that my State, when Kelly is closed, will
lose a minimum of 7,000 jobs that will go to the other three depots--
7,000 jobs.
Now, what Senator Hutchison and I want is simply to allow private
contractors in our State or anywhere else to have the right to compete
for this work and, if they can do it better, if they can do it cheaper,
they would have an opportunity to do it. Quite frankly, the Air Force
believes that we could have savings in the range of 20 to 25 to 30
percent by having price competition and by choosing the depots through
Government employees to do the work when they are cheaper and choosing
private companies to do the work when they are cheaper.
I remind my colleagues, given that defense has been cut by a third
since 1985, it ought to be welcome news that we can save that kind of
money. We currently have a proposal out to privatize the maintenance of
the C-5, the great big transport plane that is operated by the Air
Force. We have all seen it or seen pictures of it; it is big. Now, that
was a function at Kelly. So what the Air Force wants to do is to put it
out for bids, and if one of the depots can do it cheaper, to move it
there, or if a private contractor can do it cheaper, take the facility
that has been turned over to the City of San Antonio and lease it to a
private contractor, or even let a private contractor in any other city
in the country do it, if they can do it cheaper.
Now, the bill before us says that that contract would have to be
stopped, that you could not have competitive bidding until the depots
were operating at 75 percent of capacity, which would be most of all
the work that exists in the Air Force today, so in effect there would
never be another competitive bid. And it says, even if you had a
competitive bid, nobody using facilities that used to be Kelly Air
Force Base, or used to be McClellan Air Force base in California, could
compete.
Now, I understand give and take. I understand compromise. But I don't
understand knocking people down and stepping in their faces. That is
basically what we are talking about here. Now, if we were simply
talking about Texas' interest, I am for Texas' interest. I get paid to
represent it, and I try to do a good job at it. But the reason that I
am adamant about this subject is this is not just Texas, this is
America. Why should we not have price competition?
I would like to remind my colleagues, when I was on the Senate Armed
Services Committee--and two of my colleagues here sat with me every day
I was on that committee--I always supported competition, I always
supported privatization, and I always supported it, even though my
State might have benefited if we had stopped competition, because it is
something I believe
[[Page S5918]]
in. It is fundamentally important to America. I know we have people who
stand up and say, well, we can't contract out maintenance for the F-l6.
You could not trust somebody who didn't work for the Federal Government
to maintain the F-l6. Our freedom depends on it. Well, who built the F-
l6? Private contractors. The plain truth is, if Government defense
without the involvement of the private sector really worked, we would
have lost the cold war.
My point is this: We ought to have it as a matter of policy, and
since I am standing on our side of the aisle, let me speak as a
Republican. If Republicans believe in anything, it is competition. If
Republicans stand for anything, it is that when we are spending the
taxpayers' money, we ought to do it as efficiently as possible. We
ought not to be concerned about where somebody lives that can do the
work cheaper. We ought not to be concerned about what their gender is
or their ethnicity. We ought to be concerned about the work they can
do, the quality they can provide, and what they are willing to charge.
I have tried to break this impasse. Let me explain what I have
proposed and why I think it is more than reasonable, bending over
backward, and then I will yield the floor. Obviously, if you wanted to
be reasonable on this issue, you would simply say to the Defense
Department, look, here are a set of criteria for looking at a fair
competition with a level playing surface. Let me say, with all due
respect, to the depot caucus in the House, the only fair competition to
them is no competition. The last thing on Earth they want is
competition. But we could set out simple criteria for a level playing
surface to have competition between the public sector and the private
sector to do this work. What we ought to do is to do that scrupulously
and choose the low bidder for the highest quality and get the most
defense we can for the money we have. That is logic.
To try to break this impasse, I have made the following proposal.
Have competitive bidding after you first set out the criteria for
competitive bidding. If you want to look at the cost of the facilities
they are using, to make adjustments for it, then look at everything--
look at retirement costs, look at every single cost, come up with a way
of measuring it, and have a competition. And then, even if the depots
lose the competition by less than 10 percent, give it to them anyway.
In other words, let's say that we can maintain the C-5 through a
Government depot for $109 million, and let's say that a private
contractor can do it for $100 million. What I have said is, to try to
break this impasse, cheat the taxpayer out of $9 million. Give it to
the depot. But if the private sector can do it for more than 10 percent
less, give it to them.
Now, what that is saying is that the depots will win any close
competition. If they are no more than 9.99 percent higher, they win.
But if the private sector can do it for 10 percent or more less, can it
be prudent public policy, can it make any sense to deny them the right
to do that work? I think the answer is no. That has been a proposal
that I have made.
Some people have answered, well, you won't have a fair competition.
The Air Force will cheat us. I am willing to try to set out criteria. I
personally don't believe any of us are so important that the Air Force
is out to cheat us. I have never believed in conspiracies. But the
point is, all I am trying to do here is not keep a Texas base open. It
is going to be closed. But what I want the workers there to have a
chance to do is to go to work for private companies that might have a
chance to compete for work. So I am not asking for anybody to give
anything to San Antonio, TX. But I am demanding that we have an
opportunity to compete. A problem we have here is we have a bill that
bans that competition. And then we are going to conference with the
House, which basically has the approach that whatever money there is
belongs to us and we are not worried about how efficiently it is spent,
and this is really defense welfare anyway.
So what I am trying to do, and what I would very much like to do to
move ahead, is to try to work out an agreement on the principle of
competition, something we believe in, something that clearly works, and
I am willing to give an edge to the Government. But I think a 10-
percent edge is more than generous. I don't think most Americans would
agree with that, especially when many of the people competing are
small, independent businesses. But, again, I mention this not because I
think it is what we ought to do, but what I am willing to do to try to
break this logjam. So I thought it was important, having run over here
from the Finance Committee and objected and then run back without
having a chance to say anything, to get an opportunity to explain why
this is important.
This is a critically important issue. I feel like Senator Hutchison
and I have not been treated fairly on this issue. I believe there is a
fundamental national objective here, and I see it as the competition
between special interests and the public interest and, in this case,
the public interest is also the Texas interest. When you combine the
two, I am getting paid twice to do the same work. So I want to be sure
that I do it well. That is what this whole thing is about.
Again, I want to apologize to my colleagues for inconveniencing the
process. I know they want to move ahead with their bill. But I know
that each of them, from time to time, have found themselves in a
similar position.
Thank God the Founding Fathers set up the Senate where one Member
does have power; where one person can stand in the face of large
numbers of others and say, ``no.'' Ultimately, they can be run over,
but they can't be run over for a long time. I think we all benefit from
that.
So I am simply taking advantage of the rights I have as an individual
Member, as any Member here would, I believe, under the circumstances.
I thank my colleagues for listening. I yield the floor.
Mr. LAUTENBERG addressed the Chair.
The PRESIDING OFFICER. The Senator from New Jersey.
Mr. LAUTENBERG. Mr. President, are we at the moment in morning
business?
The PRESIDING OFFICER. We are on S. 4.
Mr. LAUTENBERG. Mr. President, I ask unanimous consent that S. 4 be
set aside and that I be permitted to speak for up to 15 minutes.
The PRESIDING OFFICER. Without objection, it is so ordered.
____________________