Defense Infrastructure: Issues Need to Be Addressed in Managing
and Funding Base Operations and Facilities Support (15-JUN-05,
GAO-05-556).
Concerns have surfaced in Congress and various media regarding
the adequacy of funding for base operations support (BOS)
functions of military installations as well as the quality and
level of support being provided. As requested, this report
addresses (1) the historical funding trends for BOS as contrasted
with funding for facilities sustainment, restoration and
modernization (S/RM); (2) how effectively the Department of
Defense (DOD) and the military services have been able to
forecast BOS requirements and funding needs; and (3) how the
Army's and Navy's reorganizations for managing installations have
affected support services, and whether the Air Force and Marine
Corps could benefit from similar reorganizations.
-------------------------Indexing Terms-------------------------
REPORTNUM: GAO-05-556
ACCNO: A26617
TITLE: Defense Infrastructure: Issues Need to Be Addressed in
Managing and Funding Base Operations and Facilities Support
DATE: 06/15/2005
SUBJECT: Appropriated funds
Defense appropriations
Facility maintenance
Facility management
Interagency relations
Military appropriations
Military bases
Military facilities
Military forces
Reprogramming of appropriated funds
Budget obligations
Defense capabilities
Strategic planning
******************************************************************
** This file contains an ASCII representation of the text of a **
** GAO Product. **
** **
** No attempt has been made to display graphic images, although **
** figure captions are reproduced. Tables are included, but **
** may not resemble those in the printed version. **
** **
** Please see the PDF (Portable Document Format) file, when **
** available, for a complete electronic file of the printed **
** document's contents. **
** **
******************************************************************
GAO-05-556
United States Government Accountability Office
GAO Report to the Subcommittee on Readiness, Committee on Armed Services, House
of Representatives
June 2005
DEFENSE
INFRASTRUCTURE
Issues Need to
Be Addressed in
Managing and Funding
Base Operations and
Facilities Support
a
GAO-05-556
[IMG]
June 2005
DEFENSE INFRASTRUCTURE
Issues Need to Be Addressed in Managing and Funding Base Operations and
Facilities Support
What GAO Found
Congress has designated increased funding for BOS programs in recent
years, sometimes more than requested, but because those amounts were often
less than the cost of BOS services provided at installations, hundreds of
millions of dollars designated for S/RM and other purposes were
redesignated by the military services to pay for BOS. As GAO has
previously reported, such funding movements while permissible are
disruptive to the orderly provision of services, contribute to the
degradation of many installation facilities, and can adversely affect the
quality of life and morale of military personnel. The problem appears to
be greatest in the Army. Further, in fiscal year 2004, U.S. military
installations faced additional pressures in managing available BOS and
S/RM funding as the services redesignated varying amounts of these funds
to help pay for the Global War on Terrorism. Similar problems are
reportedly occurring in fiscal year 2005. While difficult to quantify,
installation officials at the locations GAO visited voiced concerns about
the potential for these conditions to adversely affect operations and
readiness in the future. Moreover, such movements of funds add
considerable uncertainty regarding actual BOS requirements and the extent
of underfunding.
The ability of DOD and its components to forecast BOS funding requirements
has been hindered by the lack of a common terminology across the military
services in defining BOS functions as well as the lack of a mature
analytic process for developing credible and consistent requirements
comparable to the model developed for facilities sustainment. The lack of
common definitions among the services, particularly where one service
resides as a tenant on an installation operated by another service, can
lead to differing expectations for installation services, and it obscures
a full understanding of the funding required for BOS services. Because the
military services have often based future requirements estimates largely
on prior expenditures, they do not necessarily know if BOS services were
provided at appropriate levels. DOD and the military services have a
strategic plan for installations and have multiple actions under way to
address these problems, but they have not synchronized varying time frames
for accomplishing related tasks. Until these problems are resolved, DOD
will not have the management and oversight framework in place for
identifying total BOS requirements, providing Congress with a clear basis
for making funding decisions, and ensuring adequate delivery of services.
While the Army's and Navy's creation of centralized installation
management agencies can potentially create efficiencies and improve the
management of the facilities through streamlining and consolidation,
implementation of these plans has so far met with mixed results in quality
and level of support provided to activities and installations. Until more
experience yields perspective on their efforts to address the issues
identified in this report, GAO is not in a position to determine whether
the approach should be adopted by the other services.
United States Government Accountability Office
Contents
Letter
Results in Brief
Background
While Historical Trends Show an Increase in BOS Funding,
the Services Have Redesignated Other Funds to Meet
BOS Services
Accurate Forecasts of BOS Requirements and Funding Needs Have
Been Hampered by Several Factors
Centralized Installation Management Has Many Benefits, but More
Perspective Is Needed Before It Can Be Fully Evaluated
Conclusions
Recommendations for Executive Action
Agency Comments and Our Evaluation
1 4 7
12
18
27 33 34 34
Appendixes
Appendix I: Scope and Methodology 36
Appendix II: BOS Functions and Activities Used by the
Military Services 39
Appendix III: Army and Navy Base Operations Support
Management Structure 44
Appendix IV: Impact of Funding Constraints on BOS and S/RM
Activities 49
Appendix V: Navy, Marine Corps, and Air Force Funding 56
Trends
Appendix VI: Comments from the Department of Defense 64
Appendix VII: GAO Contact and Staff Acknowledgments 66
Related GAO Products
Contents
Figures Figure 1: Figure 2: Figure 3: Figure 4: Figure 5: Figure 6: Figure
7: Figure 8: Figure 9: Army BOS Funding, Fiscal Years 2001-04 13 Army S/RM
Funding, Fiscal Years 2001-04 15 Army BOS Functions and Activities 40 Navy
BOS Functions and Activities 41 Marine Corps BOS Functions and Activities
42 Air Force BOS Functions and Activities 43 Army Installation Management
Agency Organization 44 Army Installation Management Agency Locations 45
CNI Organization 47
Figure 10: CNI Locations 48 Figure 11: Navy BOS Funding, Fiscal Years
2001-04 56 Figure 12: Navy S/RM Funding, Fiscal Years 2001-04 58 Figure
13: Marine Corps BOS Funding, Fiscal Years 2001-04 59 Figure 14: Marine
Corps S/RM Funding, Fiscal Years 2001-04 60 Figure 15: Air Force BOS
Funding, Fiscal Years 2001-04 62 Figure 16: Air Force S/RM Funding, Fiscal
Years 2001-04 63
Abbreviations
BOS base operations support
CNI Commander, Navy Installations
DOD Department of Defense
IMA Installation Management Agency
O&M operation and maintenance
OSD Office of the Secretary of Defense
S/RM sustainment, restoration and modernization
This is a work of the U.S. government and is not subject to copyright
protection in the United States. It may be reproduced and distributed in
its entirety without further permission from GAO. However, because this
work may contain copyrighted images or other material, permission from the
copyright holder may be necessary if you wish to reproduce this material
separately.
A
United States Government Accountability Office Washington, D.C. 20548
June 15, 2005
The Honorable Joel Hefley Chairman The Honorable Solomon P. Ortiz Ranking
Minority Member Subcommittee on Readiness Committee on Armed Services
House of Representatives
The Department of Defense (DOD) manages nearly 517,000 buildings and
structures (replacement value of $650 billion) and over 46,000 square
miles of real estate at its bases and installations worldwide. At the same
time, DOD recognizes that it maintains infrastructure in excess of its
needs,1 and that it faces challenges in allocating sufficient funds to
maintain this infrastructure and supporting other base operating needs. We
have previously reported on the impact resulting from such underfunding,
including the deterioration of facilities, and its negative effects on the
quality of life for those living and working at the installations and on
their ability to accomplish their mission activities.2 More recently, you
and others have expressed concerns about the adequacy of funding for
overall base operations and whether funds were being moved to meet other
pressing needs, leaving shortfalls in base operating accounts.
Operation and maintenance (O&M) funding is the primary category of funds
used to keep military installations running and the facilities in good
working order. Within O&M funding, there are distinct functional areas,
including (1) base operations support (BOS)-a term used to describe a
1 Retaining and underutilizing installations and facilities result in
inefficiencies and additional costs for base services and programs.
Congress authorized a base realignment and closure round in 2005 to deal
with this issue.
2 See the following reports: GAO, Defense Infrastructure: Changes in
Funding
Priorities and Strategic Planning Needed to Improve the Condition of
Military Facilities,
GAO-03-274 (Washington, D.C.: Feb. 19, 2003); Defense Infrastructure:
Changes in
Funding Priorities and Management Processes Needed to Improve Condition
and Reduce
Costs of Guard and Reserve Facilities, GAO-03-516 (Washington, D.C.: May
15, 2003);
Defense Budget: Real Property Maintenance and Base Operations Fund
Movements,
GAO/NSIAD-00-101 (Washington, D.C.: Mar. 1, 2000); and Defense Management:
Army
Needs to Address Resource and Mission Requirements Affecting Its Training
and
Doctrine Command, GAO-03-214 (Washington, D.C.: Feb. 10, 2003).
collection of day-to-day programs, activities, and services needed to keep
the bases and installations running;3 (2) facilities sustainment,
restoration and modernization (S/RM)-the recurring maintenance and repairs
needed to keep facilities in good working order and in up-to-date
condition; and (3) mission support-the goods and services needed to
prepare for and conduct combat and peacetime missions, including training
and weapons systems maintenance.
For fiscal year 2004 O&M activities, Congress appropriated about $83.5
billion for active duty forces and about $14.3 billion for reserve and
national guard forces, excluding DOD-wide and miscellaneous O&M
activities.4 Within the O&M appropriations, conference report data show
that Congress designated5 $14 billion for BOS, $5.5 billion for facilities
sustainment, and $78.3 billion for mission and other support. These
designations were based on the sum of a set of defined program elements or
activity groups and subactivity groups supporting the appropriation bill's
conference report, and are not binding unless they are incorporated
directly or by reference into an appropriation act or other statute. Thus,
DOD and its components have considerable flexibility in using O&M funds
and can redesignate funds among activity and subactivity groups in various
ways. Accordingly, it is important to note that amounts designated in the
3 BOS is a term that derives from the "base operations" program area
(which includes installation transportation, supply, information
management, food services, legal and accounting services, and so forth) to
which the military services have added other program areas including
family and quality of life programs, force protection, environmental
compliance and conservation programs, communications services, and grounds
maintenance, as well as other facilities services such as utilities,
leases, and custodial services, which OSD has referred to as real property
services. Thus, in practice BOS is a collection of many diverse programs,
activities, and services. Beginning with fiscal year 2006 O&M budget
submissions, OSD has started referring to real property services as
"facilities operations" and to other base support programs as
"installations services." Collectively, installation services and
facilities operations will be known as DOD's "installations support"
functional area.
4 See Department of Defense Appropriations Act, 2004, Pub. L. No. 108-87
(2003). Congress appropriated an additional $16.2 billion for DOD-wide and
miscellaneous O&M activities.
5 We use the terms "congressionally designated," "congressional
designation," or variations of these terms throughout to refer to amounts
set forth at the budget activity, activity group, and subactivity group
level in an appropriation bill's conference report. These recommended
amounts are not binding unless they are also incorporated directly or by
reference into an appropriation act or other statute.
services' accounting records for O&M functional areas, such as BOS, do not
perfectly coincide with these congressional designations. For example,
according to historical data provided by the military services, fiscal
year 2004 O&M funds designated for BOS services totaled $15.6 billion,
about $1.6 billion more than data supporting the conference report showed
as being designated for BOS at the beginning of the fiscal year. Service
officials attributed the variance to their accounting for the BOS services
provided at their respective installations-the number and names of which
are different and expanded from the BOS subactivity groups used for the
conference report-and to funding redesignations that occur during the
year. Accordingly, this report uses the congressional designations as
adjusted by the services' accounting and redesignations of O&M funds for
BOS and S/RM to depict funding trends.
Until recently, the Office of the Secretary of Defense (OSD) and the
military services have, for the most part, carried out installation
management functions at the local level, where installation commanders
have set priorities and regularly moved funds among BOS, S/RM, and mission
support accounts to pay for services and programs at their respective
installations. Increasingly, however, some of military services are moving
to centralize the management of these activities, with the expectation
that such efforts would help mitigate previous problems of funds intended
for installation management being redesignated to other purposes.
This report addresses (1) the historical funding trends for BOS functions,
as contrasted with funding for S/RM; (2) how effectively DOD and the
military services have been able to forecast BOS requirements and funding
needs; and (3) how the Army's and the Navy's reorganizations for managing
installations have affected the quality and level of support provided to
individual activities and installations, and whether the Air Force and
Marine Corps would benefit from similar reorganizations.
To address these questions, we met with officials in DOD's Office of
Installations and Environment and with Army, Air Force, Navy, and Marine
Corps headquarters officials and collected and analyzed historical funding
data. We obtained data on historic funding levels from fiscal years 2001
through 2004 from the military services based on their categorization of
BOS functions, but we concentrated our analysis principally on fiscal year
2004, the most recent year for which obligation data were available. To
ensure consistency in analyzing funding trends from one year to the next,
the historical data provided by the services and used in this report do
not
include congressional adjustments of a one-time nature or supplemental
appropriations for O&M that Congress provided during a particular fiscal
year for such things as hurricane damage cleanup and repairs or for the
Global War on Terrorism.6 We determined that the data were sufficiently
reliable for the purposes of this review in indicating broad trends and
comparisons between identified requirements, budget requests, designated
funding amounts, and subsequent obligations of funds for BOS and S/RM
functions. However, various data limitations are noted throughout the
report, such as differences between conference committee designations for
BOS funding and amounts categorized by the services. We obtained
information on the roles that OSD and the military services play in the
overall base operations process, requirements determination, budgeting,
and installations management. We visited two Air Force bases; two Marine
Corps bases; three Army bases; six Navy bases; the Army's Installation
Management Agency's (IMA) Headquarters and Southwest and Northeast
regions; and the Commander, Navy Installations (CNI) Command's
Headquarters and South and Southwest regions. We performed our work in
accordance with generally accepted government auditing standards from
April 2004 through April 2005. More details on our scope and methodology
are presented in appendix I.
Results in Brief Congress has designated increased funding for BOS in
recent years, sometimes more than requested, but because the approved
increases are often less than the cost of BOS services provided at
military installations (particularly the Army's), hundreds of millions of
dollars designated for S/RM and other purposes have been redesignated to
meet BOS needs. In some respects this is a reversal of a trend we saw a
few years ago, where BOS funds were more likely to be redesignated to fund
facilities maintenance and mission training needs. We found similar though
less pronounced funding redesignations in the Air Force, Navy, and Marine
Corps data. Each service faced problems because funds were moved among BOS
and S/RM accounts during the year. Further, in fiscal year 2004, U.S.
military installations faced additional pressures in managing available
6 For example, the S/RM-adjusted congressional designations and the
obligations we used in our analyses for the Navy did not include $168
million in fiscal year 2003 congressional adjustments to upgrade the
Navy's facilities to meet antiterrorism and force protection standards
(such as vehicle inspection shelters, pop-up barriers, fencing and gate
improvements, and so forth) or $223 million in supplemental appropriations
for hurricane damage and repairs, and the fiscal year 2004 amounts did not
include supplemental amounts for the Global War on Terrorism.
BOS and S/RM funding as the services redesignated varying amounts of O&M
funds that would have been designated for BOS and S/RM to help instead pay
for the Global War on Terrorism. At the end of fiscal year 2004,
installations received additional funds to help offset shortfalls endured
during the year. The timing made it difficult for the installations to
execute many of their BOS and S/RM activities efficiently and effectively,
however, and it resulted in the Army underexecuting its S/RM funding
designations by $882 million in fiscal year 2004. Various indicators
suggest that similar funding redesignations are occurring in fiscal year
2005. Such problems adversely affect efforts to maintain facilities and
provide base support services. Although these actions are disruptive to
planned maintenance and support programs and have the potential to
adversely affect quality of life and morale, it typically is difficult to
determine any immediate impact they may have on readiness. At the
installations we visited, however, officials often voiced concerns about
the potential impact on operations and readiness in the future should
these conditions continue. At the same time, such movements of funds add
considerable uncertainty regarding amounts required and the degree to
which BOS services may be underfunded.
DOD and the military services' ability to forecast BOS requirements and
funding needs has been hindered by the lack of a common terminology across
the military services in defining BOS functions, as well as by the lack of
a mature analytic process for developing BOS requirements comparable to
that developed for facilities sustainment requirements. Lack of common
definitions among the services, particularly where one service resides as
a tenant on an installation operated by another service, can lead to
differing expectations for services, and it obscures a full understanding
of the funding that is required for BOS services. Each service has
historically developed its own BOS requirements and funding needs subject
to its own definition of BOS and the types and levels of services it deems
necessary. Until recently, each has relied heavily on previous
expenditures as the basis for stating future requirements. But while the
military services can tell Congress how much was spent in an area in the
past, they do not necessarily know whether BOS services were provided at
appropriate levels or how much it should cost to provide them in the
future. Until such problems are resolved, DOD will not have the management
and oversight framework in place that it needs for identifying total BOS
requirements and ensuring adequate delivery of services, particularly in a
joint environment. Various efforts are under way, either within the
military services or led by OSD, to strengthen their respective abilities
to forecast future requirements. OSD and the services recognize, however,
that additional efforts are needed. Within the past year they have started
working to
develop common definitions, standards, and performance metrics. However,
as they are still in the early stages of developing these initiatives,
time frames for accomplishing many of the specific actions under way or
planned have either not been established or vary among working groups.
This creates uncertainty about the accuracy of time frames being reported
for completing the respective tasks and raises questions about how well
coordinated and integrated these efforts will be. Improvements in these
areas will be important to ensuring consistency in identifying the base
operations services expected to be provided, particularly where multiple
military services with varying support needs are located on individual
military installations, and in providing Congress with a clear basis for
making funding decisions.
While many officials view the Army's and Navy's creation of centralized
installation management agencies as having the potential to create
efficiencies and improve the management of the facilities through
streamlining and consolidation, implementation of these plans has to date
met with mixed results in the quality and level of support provided to
activities and installations. A common concern voiced by individuals at
the installations we visited was that the centralized management efforts
had not sufficiently recognized the diverse needs of the installations'
many tenants who require quick reaction in the face of changing
circumstances. Navy and Army officials acknowledge such problems as
growing pains associated with implementing the new approach and indicated
that they are working to address them. Nevertheless, until more experience
is gained from efforts to address the issues identified in this report, we
are not in a position to recommend one approach over the other. Using a
more decentralized facilities management approach at the time of our
review, the Air Force and Marine Corps were emphasizing selective
consolidation and efficiency measures to improve operations and achieve
savings.
We are making recommendations in this report for DOD to update its
strategic plan and to include specific actions and establish time frames
to, first, resolve long-standing inconsistencies among the definitions of
BOS services and, second, help expedite the development and implementation
of an analytically sound and consistently applied model for determining
BOS requirements. In commenting on a draft of this report, DOD agreed with
our recommendations and indicated that actions were under way or planned
to implement them.
Background DOD manages nearly 517,000 buildings and structures
(replacement value of $650 billion) and over 46,000 square miles of real
estate at its bases and installations worldwide. These facilities must be
properly maintained or they are subject to premature deterioration. At
these bases and installations, DOD prepares for and conducts combat and
peacetime missions, including training and weapons systems maintenance.
Doing so requires significant amounts of BOS services, such as information
management; systems operations and maintenance; facilities engineering;
transportation; utilities; environmental, safety, and health services;
housing; food services; morale, welfare, and recreation services; security
and fire services; and disaster preparedness.
Funding for O&M O&M funds finance the costs of operating and maintaining
military operations for active and reserve components, including related
support activities of DOD, but excluding military personnel costs.
Included are pay for civilians, services for maintenance of equipment and
facilities, fuel, supplies, and spare parts for weapons and equipment.
Funding requirements are influenced by many factors, including force
structure levels, such as the number of aircraft squadrons and Army and
Marine Corps divisions; installations; military personnel strength and
deployments; rates of operational activity; and the quantity and
complexity of equipment such as aircraft, ships, missiles, and tanks in
operation. For fiscal year 2004, Congress appropriated $114 billion for
O&M activities.7 DOD uses distinct activities and accounting structures to
manage O&M budgeting and funding for functional areas such as the
following:
o BOS-a term that derives from the "base operations" program area (which
includes installation transportation, supply, information management, food
services, legal and accounting services, and so forth) to which the
military services have added other program areas including family and
quality of life programs, force protection, environmental compliance and
conservation programs, communications services, and grounds maintenance,
as well as other facilities services such as
7 See Department of Defense Appropriations Act, 2004, Pub. L. No. 108-87
(2003). This amount, and the amounts we used in our historical funding
trend analyses for this report, does not include supplemental
appropriations for O&M that Congress provided for such things as the
Global War on Terrorism.
utilities, leases, and custodial services, which OSD has referred to as
real property services.8 Thus, in practice BOS is not a single,
well-defined program area but a collection of many diverse programs,
activities, and services. The different BOS functions and activities used
by the military services are shown in appendix II.
o S/RM-the maintenance and repairs needed to keep facilities in good
working order and in up-to-date condition. Sustainment funds cover
expenses for all recurring maintenance costs and contracts, as well as for
major repairs of nonstructural facility components (for example, replacing
the roof or repairing the air conditioning system) that are expected to
occur during a facility's life cycle. In addition to facilities
sustainment, O&M funds are sometimes used for facilities restoration and
modernization. Restoration includes repair and replacement work needed to
restore facilities damaged by inadequate sustainment, excessive age,
natural disaster, fire, accident, or other causes. Modernization includes
altering or modernizing facilities to meet new or higher standards,
accommodate new functions, or replace structural components.
o Mission support-the goods and services needed to prepare for and
conduct combat and peacetime missions, including training and weapons
systems maintenance. O&M funds are used by the armed forces and defense
agencies to prepare for and conduct combat and peacetime missions. For
example, DOD uses O&M funds to increase combat proficiency through flying
and ground training operations; to acquire fuel, support equipment, and
spare parts for training operations; to pay supporting civilian personnel;
and to purchase supplies, equipment, and service contracts for the repair
of weapons and weapons systems.
According to historical data provided by the military services, fiscal
year 2004 O&M funds designated for BOS services totaled $15.6 billion,
about $1.6 billion more than data supporting the conference report showed
as being designated for BOS at the beginning of the fiscal year. Service
8 Beginning with fiscal year 2006 O&M activities, DOD refers to base
operations, family and quality of life programs, force protection,
environmental compliance and conservation programs, communications
services, food services, grounds maintenance, and so forth as
"installations services" and to real property services (utilities, leases,
custodial services, snow plowing, and the like) as "facilities
operations." Collectively, installations services and facilities
operations will be known as DOD's "installations support" functional area.
officials attributed the variance to their accounting for the BOS services
provided at their respective installations-the number and names of which
are different and expanded from the BOS subactivity groups used for the
conference report-and to funding redesignations that occur during the
year. Accordingly, this report uses the congressional designations as
adjusted by the services' accounting and redesignations of O&M funds for
BOS and S/RM to depict funding trends. Further, to better project trend
data consistently, the historical data provided by the services included
in this report do not include congressional adjustments of a one-time
nature or supplemental appropriations for O&M that Congress provided
during a particular fiscal year for such things as hurricane damage
cleanup and repairs or for the Global War on Terrorism.
Services' Organizational Structures for Managing Installations
Until recent years, the military services had, for the most part, carried
out installation management functions at the local level, where the
installation commanders received O&M funding for various subactivities and
set priorities among competing demands. They also had the flexibility to
make trade-offs in the face of funding limitations, shifting funds among
subactivities' competing priorities, and to meet unanticipated demands. We
have previously reported on the movement of funds from BOS to alleviate
shortfalls in S/RM, and we have also reported instances where funds
intended for maintaining facilities had to be used to support base
operations or to cover other mission costs. However, such movements of
funds often raised or aggravated concerns about the adequacy of funding
for each of these areas or about how efficiently and effectively programs
were executed during the year.
The Army and the Navy have recently taken steps to reorganize and
centralize their installation management activities. One of the
expectations established in setting up these centralized activities was
that they would curtail or prevent the movement of funds from facilities
and base operations to other priorities and create greater stability in
the execution of those activities. IMA was activated on October 1, 2002,
providing consolidated management of Army installations worldwide. The
services managed by IMA include engineering, information technology,
resource management, and other installation support activities. The
agency's objective is to standardize installation management services,
providing consistent and equitable facilities and services via common
standards. IMA is made up of seven regional offices, four in the
continental United States and three overseas. To establish IMA, the
Department of the Army worked with its major commands to identify the
activities, personnel, and
resources that provided facilities and base operations support. These
service activities and the associated workforce were then organizationally
realigned from the major commands and their installation commanders to
establish IMA. Under the reorganization, IMA headquarters assumed control
of the BOS and S/RM budgets in fiscal year 2004 and determined the funding
for these programs and activities.
CNI was activated October 1, 2003, and is responsible for Navy-wide
installation management. Its mission is to provide uniform program,
policy, and funding management, along with oversight of shore installation
support. Prior to the activation of CNI, management of its base operations
support activities was conducted at regional levels. With the activation
of CNI, shore installation management and the personnel associated with
those functions were organizationally realigned under CNI's control. CNI
is made up of 16 regions, 10 in the continental United States and 6
overseas. Consolidation of the management of services provided at the
regional and installation levels was intended to reduce base operating
support costs through the elimination of unnecessary management layers,
duplicative overhead and redundant functions. The Army and Navy
reorganizational management structures are discussed further in appendix
III.
The Marine Corps, because it is small, has always been somewhat centrally
managed, but it generally leaves to the individual base commanders the
decisions about the level of BOS services required and issues regarding
quality of life at an installation. The Air Force has integrated BOS and
installations management into its mission programs and continues to manage
in a decentralized manner, using Air Force-level guidance. In the Air
Force, major commands are actively engaged with subordinate commanders in
the funding and management of Air Force installations.
Strategic Plan for We have cited the need for and DOD has in recent years
developed a
Installations facilities strategic plan to guide future facilities
efforts. Our February 2003 report9 noted that DOD's strategic plan for
facilities had weaknesses that included a lack of comprehensive
information on specific actions, time frames, assigned responsibilities,
and resources-the elements of a well-developed strategic plan-that are
required to meet the plan's vision.
9 GAO-03-274.
In September 2004, the Deputy Under Secretary of Defense for Installations
and Environment released the department's updated Defense Installations
Strategic Plan, which outlines a set of initiatives with some milestones
to sustain, restore, and modernize installation assets.10 The vision set
forth in the plan is to have installation assets and services, including
BOS, available when and where needed, with the joint capabilities and
capacities necessary to support DOD missions effectively and efficiently.
Prior GAO Reports Since 1997, we have identified DOD support
infrastructure as a high-risk area. We have completed a number of reviews
in which we identified numerous examples of the services' moving O&M funds
out of accounts congressionally designated to support one functional area
and into another to meet competing needs. We examined the impacts on areas
such as facilities maintenance and BOS-areas that were already considered
to be underfunded against projected needs. For example, our February 2000
report compared the funding amounts that Congress had designated for DOD's
O&M subactivities, including BOS and S/RM, with DOD's obligations for
those same subactivities, and we showed that DOD consistently obligated a
different amount from what Congress had designated.11 In February 2003, we
reported that O&M funds designated for facilities sustainment were reduced
or held back at the service headquarters, major command, and installation
levels to cover more pressing needs or emerging requirements.12 As a
result of these holdbacks and movements, we concluded that the amounts of
funds spent on facilities maintenance and repairs were not sufficient to
reverse the trend of facility deterioration. Our February 2003 report also
noted the shifting of funds from one O&M functional account to resolve
funding shortfalls in another. For example, it noted the difficulty that
redesignating facilities sustainment funds to other purposes makes for
installations in implementing rational facilities sustainment plans.
10 U.S. Department of Defense, 2004 Defense Installations Strategic Plan
(Washington, D.C.: September 2004).
11 GAO, Defense Budget: DOD Should Further Improve Visibility and
Accountability of O&M Fund Movements, GAO/NSIAD-00-18 (Washington, D.C.:
Feb. 9, 2000).
12 GAO-03-274.
While Historical Trends
Show an Increase
in BOS Funding,
the Services Have
Redesignated Other
Funds to Meet
BOS Services
Congress has designated increased funding for BOS in recent years,
sometimes more than requested, but often to amounts that were lower than
the cost of BOS services provided at installations, particularly in the
Army. This has resulted in hundreds of millions of dollars originally
designated for facilities maintenance being redesignated by the services
to meet BOS needs. As a result, the Army has faced problems in executing
planned programs effectively. Supplemental funding may be made available
to installations late in the fiscal year, as occurred in fiscal year 2004,
making it difficult for an installation to execute many of its BOS and
S/RM activities promptly and efficiently.13 For example, base services may
be reduced and routine maintenance and repair of facilities may be
deferred. (App. IV highlights some key impacts of funding shortfalls and
redesignations on BOS and S/RM activities and locations we visited.) Such
problems adversely affect efforts to maintain facilities, provide base
support services, and conduct mission training, but the overall impact is
often difficult to gauge in the short term. We found similar, though less
pronounced, funding redesignations in the Navy, Marine Corps, and Air
Force.
Army Funding Trends Available data show differences between the amounts
the Army projected as required for BOS and the amounts included in budget
requests, the congressionally designated amounts as adjusted by the Army,
and the amounts that were actually obligated for each fiscal year from
2001 through 2004. Congress gave the Army increasing funds for BOS in some
fiscal years, but these funds were less than the amounts projected by the
Army as being required and less than the amounts that were actually
obligated. As shown in figure 1, fiscal year 2004 data showed a spike in
projected requirements due at least in part to the Army's use of a model
that projected requirements at a higher level of service than was
previously used in projecting budget requirements. Obligations were higher
than funds initially provided, with funds being moved to BOS from other
accounts, such as S/RM, to permit this increase.14 At the same time,
funding turbulence across BOS and facility sustainment accounts was
exacerbated
13 End-of-year obligations provided by the services include funding that
was restored near the end of the fiscal year. This masks the degree of
turbulence affecting programs and delivery of services during the fiscal
year.
14 Army efforts to improve its projection of budget requirements are
discussed more fully in a subsequent section of this report.
in fiscal year 2004 as the Army withheld funds that otherwise would have
been designated to fund BOS and S/RM, to help pay for the Global War on
Terrorism, although some funding was restored toward the end of the fiscal
year. Such turbulence occurring during the year makes it difficult to
execute planned programs effectively and, as noted later, resulted in the
Army's underexecuting its S/RM program in fiscal year 2004.
Figure 1: Army BOS Funding, Fiscal Years 2001-04
Dollars in millions
9,000
8,000
7,000
6,000
5,000
4,000
3,000
2,000
1,000
0 2001 2002 2003 2004
Requirements
President's budget
Congressionally designated amounts, adjusted by the Army
Amount obligated
Source: GAO analysis of Army data.
Notes:
(1) Dollars are in constant fiscal year 2004 dollars.
(2) As discussed in a later section of this report, Army officials
indicated they are taking steps to improve their requirements
determination process for BOS funding.
(3) Obligations exceeded adjusted congressionally designated amounts as a
result of authorized internal adjustments among accounts. For example, as
discussed below, the Army moved S/RM funds into the BOS account.
The data show that BOS funding provided by Congress increased in fiscal
year 2002, remained stable in fiscal year 2003, and declined in fiscal
year 2004. They also show that BOS obligations increased, particularly in
2003 and 2004, and that the Army routinely obligates more for BOS services
than adjusted congressionally designated amounts, through redesignations
of funds from other accounts. For example, in fiscal year 2004, the Army's
request for BOS funding-$5.756 billion-was about 65 percent of the amount
it projected as being needed to provide traditional levels of BOS
services. According to Army officials, while congressionally designated
amounts as adjusted by the Army-$6.009 billion-were somewhat more than
they requested, during the year they nevertheless had to reduce BOS
programs because they did not have sufficient funds to pay for traditional
levels of BOS services since they had to temporarily move some BOS funds
to pay for the Global War on Terrorism. To what extent the Army's actual
needs increased over prior years is difficult to fully gauge because,
according to Army officials, the requirements model used for fiscal year
2004 budget requests reflected improved information on the resources
needed to provide BOS programs and services compared to what they had used
in prior years. At the same time, because many BOS programs involved bills
that must be paid in a timely manner (such as utilities and contracts),
during the year the Army moved $882 million from S/RM accounts and $816
million from other O&M accounts and used supplemental funding for the
Global War on Terrorism to cover its essential bills and BOS services
(total amount obligated was $7.707 billion).
In contrast with BOS requirements, S/RM trend data show that S/RM
requirements and President's budget requests have remained relatively
constant since fiscal year 2002. Army officials attributed this
consistency to improved facilities sustainment requirements forecasts
achieved by using DOD's facilities sustainment model and a cost factors
handbook, both of which were developed for this purpose in recent years.15
However, as shown by figure 2, the Army has consistently requested fewer
funding dollars for S/RM services than it had internally projected as
being needed to provide levels of S/RM services projected by the model.
Furthermore, the Army obligated fewer funding dollars for S/RM activities
than adjusted congressionally designated amounts in the last 3 years.
15 This model, developed by DOD in 1999, estimates the annual sustainment
cost requirement, adjusted for area costs, for each service and defense
agency, based on the number, type, location, and size of total inventory
of facilities. The cost factors handbook uses commercial benchmark costs
to determine the annual cost per square foot (or similar unit of measure)
to sustain each facility type.
Figure 2: Army S/RM Funding, Fiscal Years 2001-04
Dollars in millions 3,000
2,500
2,000 1,500
1,000 500
2001 2002 2003 2004
Requirements
President's budget
Congressionally designated amounts, adjusted by the Army
Amount obligated
0
Source: GAO analysis of Army data.
Notes:
(1) Dollars are in constant fiscal year 2004 dollars.
(2) Army officials indicated they had improved S/RM requirements forecasts
by using the DOD facilities sustainment model developed in 1999.
(3) Obligations were less than congressionally designated amounts,
adjusted by the Army, as a result of authorized internal adjustments among
accounts. For example, as discussed below, the Army moved S/RM funds into
the BOS account.
According to Army officials, the difference between the amounts designated
for S/RM services and the amounts obligated is made up of funds moved from
S/RM activities and redesignated to BOS activities to pay for "must pay
bills" (such as utilities and, increasingly, obtaining services from
contractors). This indicates a continuation of the historic trend of funds
being moved among various O&M subaccounts during the year, but a reversal
of a trend we saw a few years ago where BOS funds were more likely to be
redesignated to fund facilities maintenance and other needs. S/RM services
were also affected by the Army's withholding O&M funds that otherwise
would have been designated to fund BOS and S/RM, to help pay for the
Global War on Terrorism. Similar problems reportedly are
occurring in fiscal year 2005. The Army ultimately was able to provide
additional funds to installations late in the fiscal year ($100 million in
August 2004 and another $100 million on September 30, 2004), as
supplemental funding was made available to cover warfighting costs, but
Army officials told us that the timing made it difficult for the
installations to execute many of their BOS and S/RM activities promptly
and efficiently. We noted that this resulted in the Army's underexecuting
its S/RM program by $882 million in fiscal year 2004. As we have
previously reported, such problems adversely affect efforts to maintain
facilities and provide base support services. End-of-year figures shown in
figures 1 and 2 mask somewhat the level of turbulence that occurred during
the year as funds moved between accounts. Similar masking occurred in BOS
and S/RM accounts in the other military services.
Other Military Services Have Faced Similar Though Less Pronounced Problems
BOS and S/RM funding trends and problems identified in the Army also
occurred in the Navy, Marine Corps, and Air Force but were less
pronounced. Nevertheless, each of these services faced similar challenges
in its ability to execute planned programs effectively as a result of its
moving of funds among accounts. For example, we found the following:
o Congress gave the Navy increased funding for BOS during some years,
though we found a smaller difference here than for the Army between
identified requirements and funding. The difference between the Navy's
obligations and its funding also appears to be smaller than that for the
Army, but the Navy's obligations for BOS still were greater than were its
congressionally designated amounts for BOS as adjusted by the Navy. Navy
officials said the difference between these adjusted congressionally
designated amounts and the amounts obligated is made up of funds
redesignated from S/RM activities to BOS activities to pay essential BOS
bills such as utilities and, increasingly, obtaining contactor services.
o Navy S/RM funding trend data show a spike in congressionally designated
amounts adjusted by the Navy and in obligations for fiscal year 2003.
According to Navy officials, 2003 was simply a well-funded year for Navy
shore facilities. However, in fiscal year 2004, S/RM services were
negatively affected by the Navy's withholding of O&M funds otherwise
intended to fund BOS and S/RM to help pay for the Global War on Terrorism.
(Similar problems reportedly are occurring in fiscal year 2005.) The Navy
obligated fewer funding dollars for S/RM activities in fiscal year 2004
than were initially designated. Although the
Navy also received supplemental funding for the Global War on Terrorism
for BOS and S/RM activities, such turbulence occurring during the year
makes it difficult to execute planned programs effectively and resulted in
the Navy's underexecuting its S/RM program by $393 million in fiscal year
2004.
o The trend data for BOS obligations present a more mixed picture for the
Marine Corps. For half of the period (2 of 4 years), its obligations were
greater than both congressionally designated amounts, as adjusted by the
Marine Corps, and projected requirements. For example, in fiscal year
2004, the Marine Corps' BOS obligations of $1.164 billion were $54 million
more than its designated funding ($1.110 billion), representing a movement
of funds from other accounts to support BOS activities.
o S/RM trend data show that the Marine Corps obligated more funding than
adjusted congressionally designated amounts in fiscal years 2001 and 2003,
and it obligated less funding than adjusted congressionally designated
amounts in fiscal year 2004. Marine Corps officials said the differences
were due to funds being moved and redesignated among BOS and S/RM
accounts.
o Data were not readily available to provide a trend for the Air Force's
projected BOS requirements.16 Funding trend data for BOS services and
programs within the Air Force show that budgetary requests, funding, and
BOS obligations remained more closely aligned than was the case for the
other services in most years. Nevertheless, some differences do exist
among budget requests, funding, and obligations.
o Air Force trend data for S/RM activities during fiscal years 2001
through 2004 show that obligations were greater than funding or budget
requests in each of the 4 years. According to Air Force officials, BOS and
other O&M activities' funds were redesignated by installation commanders
in fiscal year 2004 to supplement S/RM funds.
16 Although the Army, Navy, and Marine Corps were able to provide
information on requirements, Air Force officials indicated that to do so
would require extraordinary efforts to accumulate data from individual
installations and commands, and they did not view such unrefined
requirements data as necessarily representative of true requirements.
Additional details on funding trends for the Navy, Marine Corps, and Air
Force are included in appendix V.
Accurate Forecasts of BOS Requirements and Funding Needs Have Been Hampered by
Several Factors
DOD and the military services' ability to forecast BOS requirements and
funding shortfalls have been hindered by the lack of a common terminology
across the services for defining BOS functions, as well as by their lack
of a mature analytic process for developing BOS requirements comparable to
the one developed for facilities sustainment requirements. The lack of
common definitions for BOS services among the military services impairs
the development of a complete picture of total BOS requirements across the
military services, and it can lead to differing expectations where
multiple military services are colocated on a single installation.
Historically, each service has developed its own BOS requirements and
funding needs, based on previous expenditure levels and subject to its own
definition of BOS and the types and levels of services it has deemed
necessary to provide. Various efforts are under way to improve BOS
management and strengthen the ability of DOD and its components to
forecast future requirements, provide Congress with a clearer basis for
making funding decisions, and ensure adequate delivery of services, but
OSD and the services recognize that more are needed.
Lack of Common Definitions of BOS Functions and Services Leads to Different
Expectations
In completing this review we found that what constitutes BOS functions and
services varies among the military services, thus contributing to the
existence of different expectations for the levels of BOS services being
provided.17 Also, this variation has carried over into the support
agreements and reimbursement practices used by the different commands and
military services located at the installations. In visiting various
military installations we found a variety of instances where the lack of a
common definition of BOS functions and services was problematic, most
often where multiple commands and military services were colocated at a
single installation.
For example, the Naval Air Station Corpus Christi, Texas, is host to
non-Navy tenants, including the Coast Guard, the U.S. Customs Service, and
an Army Depot. Coast Guard officials said that they enjoy numerous
benefits by being at the base, including no rent payments and better
17 This makes it difficult to determine the totality of BOS requirements
across DOD.
security, housing, child care, and fitness centers-better conditions than
they had experienced before moving onto the base. Despite the benefits
afforded by their service agreement with the Navy base, Coast Guard
officials expressed concern over decreasing levels of BOS services,
including reductions that negatively impact their mission. For example,
Coast Guard officials said they cannot always meet their 30-minute launch
requirement for nighttime air missions because the base has cut back on
operating hours, keeping the airfield open only during the day. Therefore,
Coast Guard officials said, when performing after-hours missions, the
flight crew must get out of their aircraft, stop traffic, and manually
unlock and open a gate to access the runway. This process sometimes makes
it impossible for the Coast Guard to meet its 30-minute launch
requirement. In addition, Coast Guard officials said they could never be
certain that runway lights would be on when they needed to land late at
night or whether the tower would answer, and they are unable to conduct
training at the base at night, when the airfield is closed. Corpus Christi
Army Depot, another of the Naval Air Station's tenants, also has a service
agreement with the base that identifies which services are to be provided
by the Navy at no cost and which services the Army Depot must pay for
(through reimbursements to the Navy). Army Depot officials told us that
they were incurring increasing costs but receiving reduced BOS services
from the Navy. Corpus Christi officials said they had no choice but to
reduce services because they did not have the BOS and S/RM funds needed to
maintain the levels of services they had provided in the past.
Tinker Air Force Base, Oklahoma, houses multiple Air Force missions across
multiple commands and also hosts the Navy as a tenant activity on the
base. An Air Force official from a command other than the one responsible
for managing the base told us that its support agreement, signed in 1996,
did not clearly specify the quantity or quality of services the base would
provide and that the base did not have enough money to provide all of the
needed services. As a result, the tenant said it spends from $55,000 to
$75,000 a year on BOS services from its O&M mission accounts and works
personnel extended hours to meet some needs. We found that the Navy tenant
has an interagency support agreement with the Air Force, regarding which
services the Air Force is to provide at no cost (such as food services),
which services the Navy will reimburse the Air Force for (such as
utilities), and which services the Air Force will not provide due to the
uniqueness of different approaches and governing regulations between the
military services (such as legal support personnel). The Air Force at
Tinker has contracted with the private sector for much of its BOS, and the
Navy shares in the cost of that contract, in
accordance with its interagency support agreement. While Navy officials
stated that overall the BOS services provided by the Air Force were
adequate, they nonetheless expressed concern about limitations in some
base support services, which forced them to pay separately for some BOS
services, such as security and education, out of other O&M funds. Navy
officials also expressed concern that some expected BOS services were
being scaled back; for example, mail service pickup and delivery were
reduced from twice to once per day, and fire department inspections and
repair and replacements of fire extinguishers were postponed. Navy
officials expressed further concern about service reductions in the
facilities sustainment area, compromising preventive maintenance and
contributing to further deterioration of the facilities.
According to Tinker Air Force Base officials, they do not have sufficient
funds to provide all BOS and S/RM services at the levels or timing desired
by their tenants, and they have worked to gain efficiencies in their
programs and have scaled back some programs that are not mission critical.
For example, they said that they can only replace carpet once every 10
years; thus, if a tenant's carpet is worn out in 8 or 9 years, the tenant
must either wait 1 or 2 years or use other funds to pay for new carpet.
Tinker officials conceded that there is not as much money available for
preventive maintenance as they would like, but they believe that the base
has done a good job of fixing things when they break. They acknowledged
that the tenants might think things do not get fixed fast enough, but
stated that the base and its contractor are in full compliance with Air
Force standards for performing such services. In addition, they are
negotiating revisions to their support agreements to help clarify which
BOS and S/RM services the tenants should pay for and which services should
be the responsibilities of the base.
We found similar concerns at the other installations we visited,
particularly those with multiple commands represented on a single base or
with one service residing as a tenant at an installation operated by
another service. The potential magnitude of the problem of differing
expectations is significant, as the Army alone has about 1,200 agreements
with the other military services to provide BOS services and about 250
agreements with other agencies for this purpose. As DOD increasingly
emphasizes jointness and potentially joint basing, problems such as those
noted above are likely to increase in the absence of clearer delineation
of BOS service requirements and common definitions of BOS functions.
Requirements and Funding Needs Have Historically Been Service Driven and
Based on Previous Expenditure Levels
The Office of the Deputy Under Secretary of Defense for Installations and
Environment oversees the procedures that the military services use to
develop BOS requirements and funding needs, but each service has
historically developed its own BOS requirements and funding needs subject
to its own definition of BOS and the types and levels of services it deems
necessary to provide. Unlike the facilities sustainment area, in which DOD
has developed a model useful for forecasting funding requirements, for BOS
the services have had few institutional-level requirements-forecasting
tools. Until recently, they have relied heavily on previous expenditures
as the basis for stating their future requirements. But while the services
can tell Congress how much was spent in an area in the past, they do not
necessarily know whether these services were provided at appropriate
levels or how much it would or should cost to provide them in the future.
DOD and the services have recognized this as a problem and have various
initiatives under way to better develop and calculate BOS requirements and
funding needs, similar to what they have done in the facilities
sustainment area.
As noted earlier, DOD has taken steps to improve its identification of the
funding required to maintain its facilities. For example, as we previously
reported, in 1999 DOD issued its first defense facilities cost factors
handbook. Based on the guidelines in the handbook, DOD divides defense
facilities into approximately 400 categories and uses commercial benchmark
costs to determine the annual cost per square foot (or similar unit of
measure) to sustain each facility type. The purpose of the handbook was to
standardize the methods by which the services would determine the
sustainment costs of their facilities and to establish a minimum
sustainment funding level for facilities. Likewise, in 1999, DOD developed
the facilities sustainment model, which estimates the annual sustainment
cost requirement, adjusted for area costs, for each service and defense
agency, based on the number, type, location, and size of its total
inventory of facilities. Because of competing priorities, the services
have not always funded sustainment at 100 percent of requirements
identified using these tools, and we have reported instances where
percentages of funding reaching individual installations varied.
Nonetheless, these tools offer a superior basis for identifying
requirements than existed previously. Similar tools have not been
developed for forecasting requirements in the BOS area, although OSD and
individual services are taking some steps to improve forecasting BOS
requirements.
Until recently, the Army relied heavily on historical expenditures as the
basis for stating its future BOS requirements. In the mid-1990s, the Army
developed a model that forecasts its BOS requirements based on regression
cost-estimating relationships derived using historical data, demographics,
pacing measures, and quality factors. According to Army officials, they
continually work to improve the model and to update the information used
in it. They indicated that since the model currently reflects all the
resources needed to provide BOS programs and services at the highest
standards without any shortcomings, the Army does not expect to fully fund
its requirements and is working instead to ensure that the necessary and
affordable services are provided. Army officials told us that they are now
working to develop common level of support models that they will use to
provide definitive guidance, performance standards, and performance
measures for the uniform delivery of various BOS services at an affordable
support level across Army installations worldwide. The Army is evaluating
95 categories of services and plans to implement its common level of
support models incrementally, beginning in fiscal year 2005, as it
completes its evaluations of selected service categories. For example, the
Army analyzed the various activities that constitute recreation services-
exercise programs, libraries, movie theaters, and sporting events-and
solicited the users' priorities. It then determined which activities need
no longer be provided18 and developed common standards that it plans to
apply to remaining recreation services at each installation.
The Navy is also moving away from historical expenditures as the basis for
stating its future BOS requirements. In fiscal year 2004, the Navy
centralized its installations management and began costing out its BOS
services based on a selection of service capability options ranging from 1
(most) to 4 (least). According to Navy officials, by providing a range of
service levels and funding requirements associated with those levels for
various BOS services, decision makers can see what risks they face with
selecting given levels of funding. In an effort to reasonably balance the
levels of services provided against risk and affordability, Navy officials
said that no capability level 1 or 4 options were selected in implementing
fiscal year 2004 BOS programs and services. Instead, BOS programs and
services specifically tied to air and port operations, utilities, and some
recreational services at remote overseas locations were to be funded at
level 2. All other BOS programs and services-including such things as
environmental
18 According to an Army official, the Army's intention is to fully fund
fewer services as opposed to partially funding a larger number of services
as it has done in the past.
compliance, public safety, and human resources-were to be funded at level
3. However, officials at Navy bases we visited told us that there were not
enough funds available to the installations in fiscal year 2004 to provide
services even at the reduced levels and that they were experiencing
degradation in the quality of some services, which in some cases had gone
to level 4. For example, Navy officials at Corpus Christi said that
although fire protection was to be funded at level 3 in fiscal year 2004,
they received only 82 percent of the funding needed to provide that level
of service, resulting in the actual service level provided being level 4.
Navy officials stated that the level of fire protection at Naval Air
Station Corpus Christi is in full compliance with DOD and Navy
requirements.
The Marine Corps also has had few institutional-level tools for
forecasting requirements and, for the most part, has relied on historical
expenditures as the basis for stating its future BOS requirements. Marine
Corps officials told us that some BOS programs have performance
requirements, such as response times and minimum staffing necessary for
their fire protection and emergency response teams to effectively and
safely operate during emergencies. By utilizing the performance
requirements and their metrics, they can evaluate their response times to
forecast staffing requirements to operate a fire department, which in turn
drives the program's funding requirement. Although based primarily on the
previous year's execution amounts, Marine Corps officials told us that
most Marine Corps BOS programs and services are executed as required by
the base commanders, who have many competing needs, many of which vary
annually. For example, if the installation has a heavy snow year, the
commander may reduce the requirement to cut the grass to stay within
budget.
The Air Force has historically based its BOS requirements on the average
of the previous 4-year obligations, with programmatic adjustments as
necessary. However, beginning with the fiscal year 2006 budget submission,
Air Force officials told us that BOS requirements for the active Air Force
major command installations were derived from a BOS cost projection
formula that used multiple linear regression analysis involving BOS
personnel, plant replacement value, and contractor manpower equivalents.19
The Air Force Reserve and Air National Guard BOS
19 Air Force officials told us that requirements data for fiscal years
2001 through 2004 (the years that we used in our funding analyses) would
have to be accumulated from data from individual installations and
commands, and they did not view such unrefined requirements data as
necessarily representative of true requirements.
requirements are still based on the 4-year average method. Air Force
officials said that their major commands are actively engaged with
subordinate commanders in the funding and management of BOS services and
programs at their installations.
OSD Has Launched Some Initiatives to Improve BOS Management and Enhance
Requirements Determinations
In addition to the military services' efforts to address BOS, OSD has
recognized BOS management as a problem and, in March 2004, the Office of
the Deputy Under Secretary of Defense for Installations and Environment
designated the improvement of BOS management as a priority. According to
office officials, DOD's and the military services' ability to forecast BOS
requirements and funding needs has been hindered by the lack of a common
terminology across the military services for defining BOS functions and
the lack of common definitions impairs the development of a complete
picture of total BOS requirements and can lead to differing expectations
for services where multiple military services are collocated on a single
installation. Office officials explained that BOS is not a single program
but instead comprises many diverse functions and activities-the Army has
identified 95 different categories of BOS functions, the Navy has
identified 124 categories, and so forth. The different BOS functions and
activities used by the military services are shown in appendix II.
Recognizing that definitions of BOS functions varied among the military
services, officials in the Office of the Under Secretary told us that they
are working with the services to (1) develop a common definition of BOS
services and programs between the military services, (2) improve the
tracking of BOS funding, (3) model BOS requirements, and (4) measure
performance. Accomplishments through March 2005 include updating the
Defense Installations Strategic Plan to articulate the need to define
common standards and metrics, using commercial benchmarks as a starting
point to define and model each subfunction of facilities operations
(utilities, leases, custodial services, snow plowing, and the like) and
establishing cross-service working groups to examine definitions and
budget structures. Officials with the Office of the Under Secretary said
that common definitions and standards would be developed incrementally, a
process that could take several years for full development and
implementation.
In a related effort, in late 2004 a separate Senior Joint Basing Group20
that was created to address installation management issues at joint bases
began efforts to resolve long-standing challenges involving support
agreements where one service is a tenant on an installation operated by
another service. Key enablers to this effort are common definitions and
DOD-wide standards, metrics, and reimbursement and costing rules for BOS
services and programs between the military services. This group has its
own set of time frames for resolving the long-standing inconsistencies
among the definitions of BOS services. Specifically, a Senior Joint Basing
Group official told us that by the end of 2005, the four military services
expect to have a common set of BOS services and programs to use in support
agreements at joint bases. It appears that a difference between OSD and
the group is that OSD focuses on developing common definitions of BOS
services for use in benchmarking funding requirements for future-year
programming and budgeting purposes at the DOD component level, while the
Senior Joint Basing Group focuses on developing common definitions of BOS
services for use in executing the programs and services at the
installation level in a joint environment. Also, DOD has attempted to gain
managerial control and better oversight of facilities and installations by
establishing an Installations Capabilities Council (formerly called the
Installations Policy Board). The council, chaired by the Deputy Under
Secretary of Defense for Installations and Environment, serves as the
coordinator and integrator of all installation tasks and activities.
Collectively, these initiatives offer an overall vision for resolving the
long-standing inconsistencies in the definitions of BOS services and the
development of analytically based requirements. Even so, we found that
time frames for completing BOS tasks were being reported differently by
different groups which raise questions about how well these efforts will
be coordinated, synchronized, and integrated.
20 The Senior Joint Basing Group, an initiative of the Deputy Under
Secretary of Defense for Installations and Environment, is made up of
senior officials from the Army, Navy, Air Force, and Marine Corps. Its
purpose is to enhance joint basing and to more efficiently use joint
assets. In late 2004, the group began addressing installation support
agreements and the development of common definitions and standards for
services such as child care, galleys, and grounds maintenance at joint
bases, using the facilities sustainment model as an archetype. In
addition, the group seeks ideas to achieve economies of scale for services
that are in proximity to one another.
Regarding DOD's efforts in modeling BOS requirements, the same official
with the Office of the Deputy Under Secretary of Defense for Installations
and Environment expressed doubt regarding whether there could be a single
BOS model because BOS, as it currently exists, has too many diverse
activities to model (see app. II). Also, because various BOS functions are
managed by various offices in DOD21 this official told us there is no
single focal point, and therefore, it is likely that a suite of BOS tools
will evolve. It will take some time to fully develop them and each office
in DOD may ultimately run its own model or metric. As a starting point,
the Office of the Deputy Under Secretary of Defense for Installations and
Environment is developing a facilities operation model that will capture
all the functions related to facilities (utilities, fire protection,
grounds maintenance, and so forth). The requirements in this model will be
driven by the facilities inventory, commercial benchmarks, and local
factors, including weather and labor rates. The office has been building
the cost factors for a few months and simultaneously preparing the model.
A prototype facilities operations model, tested on March 31, 2005, is
being validated and targeted for implementation in fiscal year 2008. Next,
the office expects to address those installation services that are not
related to facilities. These functions include transportation, supply, and
information management. There will likely be a model or metric for each of
these functions, such as a "transportation activities model" or a "human
resources management metric." An official in the Office of the Deputy
Under Secretary of Defense for Installations and Environment told us that
a transportation activities model may be very much like the facilities
sustainment model, except that instead of being based on an inventory of
facilities, it could be based on an inventory of vehicles. The human
resources management metric may be like the facilities recapitalization
metric, except that instead of being based on a facilities inventory, it
may be based on an inventory of people. The Office of the Deputy Under
Secretary of Defense for Installations and Environment and the Office of
the Secretary of Defense for Program Analysis and Evaluation will likely
act as overseers of the whole process. Specific time frames for developing
the installations services models have not been established.
21 For example, the Under Secretary of Defense (Personnel and Readiness)
manages human resources; the Assistant Secretary of Defense (Special
Operations and Low Intensity Conflict) manages physical security and force
protection; the Under Secretary of Defense (Comptroller) manages community
services; and the Assistant Secretary of Defense (Networks and Information
Integration) manages base communications.
Centralized Installation
Management Has Many
Benefits, but More
Perspective Is Needed
Before It Can Be
Fully Evaluated
The Army's and Navy's creation of centralized installation management
agencies has resulted some operating efficiencies, according to many
officials at installations we visited, but their efforts to date have met
with mixed results in terms of the quality, level of support, and
flexibility needed to quickly respond to changing needs. A common concern
was that the centralized management efforts had not sufficiently
recognized the diverse needs of the installations' many tenants who
require quick reaction in the face of changing circumstances. The
centralized management approach seeks efficiencies, and Army and Navy
officials acknowledged the growing pains associated with implementing the
new approach. The Air Force and Marine Corps, using a more decentralized
facilities management approach at the time of our review, also reported
having achieved selective consolidations and efficiency measures to
improve operations and achieve savings. Until more experience is gained
under existing centralized approaches, with opportunities to address
issues identified herein, it is difficult to recommend expanding the
concept to the other military services.
Army's and Navy's Centralized Management Approaches Seek Efficiencies
The Army's IMA implements a centralized and streamlined installations
management concept that oversees all base operations and S/RM funds for
Army installations and supervises seven regional management centers
worldwide that are responsible for 10 to 30 installations each. IMA is
designed to bring together all BOS services to ensure optimal care,
support, and training of the Army's fighting force at a standard level
across installations. Key objectives of the organizational structure
include ending the movement of funds among BOS, S/RM, and mission accounts
by major commands and implementing consistent standards across the Army
for designating these funds. IMA is also pursuing opportunities for
increased efficiencies and decreased expenditures at its installations.
IMA established a productivity improvement review process to identify and
implement hard savings and performance enhancements.
During our visits to IMA-managed installations, we observed firsthand the
emphasis being placed on cost efficiencies and decreased expenditures at
the installations. Typical efficiency actions completed or under way
included consolidations of contracts and services. Officials at IMA's
Southwest Region told us that one benefit was the ability to look across
multiple major commands and then realize benefits through consolidations
or other efficiencies. For example, common phone services at three of the
region's installations, each previously managed by a different major
command, ranged from about $54 per month to more than $100 per month per
employee. Officials said they were in the process of combining the three
contracts into a single contract with reduced rates.
The Navy's installation management agency is an organizational concept
that through centralized management of its installations, is intended to
permit mission commanders to focus their energies on their respective
mission accomplishment. According to CNI officials, consolidating eight
offices into a single office responsible for installation planning,
programming, budgeting, and resource execution enabled CNI to realize an
immediate benefit. Through this consolidating and streamlining event, the
Navy increased its visibility over installation management and resources
and gained an ability to allocate resources between functional programs,
regions, and installations to better support the overall Navy. As the
single responsible office, advocate, and point of contact for Navy
installations, CNI is pursuing, among other things, opportunities for
increased efficiencies and decreased expenditures at its installations.
During our visits to CNI-managed installations, we observed firsthand the
emphasis being placed on cost efficiencies and decreased expenditures at
the installations. Typical efficiency actions completed or under way
included eliminating the installation-level management structure and in
its place installing a regionalized management structure for such
activities as housing management, contracting, supply, business and
administrative management, maintenance, and warehousing. Officials at
CNI's Southwest Region told us that consolidated and centralized
management would eliminate 2,175 civilian personnel positions in the
region. The officials had also consolidated more than 50 contracts into
12. Similarly, officials at CNI's South Region told us that regionalized
management would generate $43 million of savings and cost avoidances
throughout the region over 5 years by eliminating installation-level
management and by consolidating contracts and services.
Growing Pains in Implementing Army's and Navy's Centralized Management
Approaches
Officials at the Army and Navy installations we visited expressed concerns
regarding the reduced levels of BOS and S/RM services they were receiving,
but they did not always distinguish between changes brought about by a new
management structure and changes necessitated by funding shortfalls and
the need to move funding to warfighting priorities. The most critical
issue involved the different major commands' mission and support needs.
Officials at the Army and Navy installations we visited contended that a
"one-size-fits-all" approach was not working well; they expressed concern
that although air and ground operations and various training missions each
required a different level of BOS, they did not perceive that difference
always being recognized by the centralized management agencies. Officials
from commands on Navy bases stated that CNI needed to step back and
identify service levels appropriate for their customers' needs and
recognize changes in operations (such as increases in the sailor
population), and then fund to those levels. Officials from major commands
claimed that a disconnect existed between their mission needs for BOS and
CNI's perspective and that in their judgment CNI should not be responsible
for determining the relative priorities of various mission activities' BOS
needs. For example, Navy Mine Warfare Command officials told us that in
fiscal year 2004 they had to spend $327,000 of O&M mission funds for BOS
services because the command no longer received BOS funds and CNI either
delayed funding or did not pay for the services out of its BOS funds.
Citing growing pains associated with the centralization of installation
management above the installation level, installation officials raised
concerns about staffing levels, cited delays in obtaining funding
guidance, and articulated concerns with IMA's ability to quickly respond
to shifting needs. For example, during fiscal year 2004, IMA opted not to
redesignate available S/RM funds to meet an emerging funding need in BOS
activities. At Fort Eustis, an installation affected by IMA's decision,
officials told us that the installation commander had the flexibility to
move funds where needed before the creation of IMA, and the installation
commander would have done so this year but doing so would have caused
significant facilities maintenance work to be deferred. These officials
explained that because IMA directed installations to use existing S/RM
funds for maintaining facilities while BOS funds were depleted, Fort
Eustis and other installations had to request an additional $200 million
of BOS funds from IMA headquarters. They did not receive these funds until
the end of the fiscal year.
In visiting various military installations we found instances where a lack
of clarity existed concerning who or what source was responsible for
funding select base support functions-installation tenants and their O&M
funding or the installation's O&M funding. Furthermore, we found many
cases where delays in funding from the installation management agency
prompted an installation's tenants to fund BOS services from mission
funds. For example, installations in IMA's Southwest Region and their
tenants could not agree on who should pay for such services as the
following: information management services and specialized information
technology equipment (such as cell phones and pagers), dedicated
administrative use vehicles, long-distance phone service, postage,
dedicated copiers, hazardous waste disposal, and tactical equipment
maintenance.
Officials with major command organizations at Naval Base San Diego and
Naval Air Station Corpus Christi said that under CNI they are seeing the
closing of automobile hobby shops, libraries, swimming pools, and other
recreational activities. The officials said they were concerned that the
reduction or elimination of base services would encourage military
personnel to spend more time away from the bases and in less-controlled or
less-desirable places. In addition, officials said mission operations have
been affected by funding shortages. For example, at Naval Base San Diego,
tugboat operating hours were cut back and the number of tugboats being
used was reduced from six boats to four boats, at CNI's direction.
Although this action saved money on fuel operations and overtime pay, once
San Diego's port operations demonstrated that they could not meet mission
requirements with fewer tugs, CNI authorized that an additional tugboat be
returned to service. Navy officials stated that some facility closures
(e.g., auto hobby shops) are due to lack of interest and are offset by
facility openings (e.g., cyber cafes).
Finally, officials at various installations expressed concern that they
were not receiving sufficient facilities sustainment funding to maintain
their facilities at levels they had expected relative to DOD's facilities
sustainment model, which was congressionally funded at 94 percent of the
facilities sustainment requirement in fiscal year 2004. For example, Naval
Station Ingleside, Texas, provided documentation showing that facilities
sustainment funds available to it were only 62 percent of its facilities
sustainment requirement under the model. An official at another
installation claimed facilities sustainment funding to be as low as 45
percent of their facilities sustainment requirements under the model. As
we have previously reported, such funding shortfalls adversely affect
efforts to maintain facilities and provide base support services. DOD
officials stated that the facilities sustainment model is a macro
programming tool that establishes an average annual investment across
entire defense components for categories of facilities over the life of
those facilities and, therefore, the actual requirement for a single
facility or small set of facilities can be expected to vary across sets of
facilities or installations and from year to year. They stated that when
the sustainment program is funded at 94 percent of requirements, they
would not expect every installation and every facility to be funded at 94
percent of its individual requirement. We recognize that facilities
sustainment funding
levels at individual installations may vary from overall funding levels in
a given year, depending upon where the facilities are in the sustainment
cycle. However, this view was not widely recognized at the installations
we visited, particularly when an installation's sustainment funding was
significantly less than overall sustainment funding levels. Military
barracks and housing repairs were frequently delayed due to lack of S/RM
funding, according to installation officials, and the following problems
have been typical: leaking roofs; peeling painting; worn carpet; lack of
hot water in the showers; energy inefficient windows; cracked sinks in
bathrooms; broken heating, ventilation, and air conditioning systems; and
molded ceilings and walls. Although funding shortfalls have been
disruptive to planned maintenance and support programs and have
potentially caused adverse effects on quality of life and morale, it is
difficult to measure any direct impact they may have on readiness.
Officials with major command operations at the installations we visited
often voiced concerns about the potential impact on operations and
readiness in the future, should these conditions continue. They were
particularly concerned with the cumulative impact of continually working
military personnel extra hours and weekends to make up for the lack of
funding in S/RM and BOS programs.
Army IMA and Navy CNI installation management officials we contacted
viewed these concerns and problems as being temporary in nature and
attributable to organizational growing pains and, to some extent, to
personnel's resistance to the changing the role of the installation
commander. They told us that while having consistent levels of services
from one installation to the next was their goal, they have made
exceptions when warranted. The officials also pointed to factors outside
their control-including unforeseen contract increases, cost of war
assessments, replacing military personnel with civilians, and funding
shortfalls-that either delayed or masked the real impact of their efforts.
Marine Corps and Air Force Report Having Achieved Efficiencies without
Centralization
Marine Corps officials said that the Marine Corps' BOS and S/RM activities
have always been somewhat centrally managed, but they generally defer to
the individual installation commanders the decisions about the level of
BOS services required and issues regarding quality of life at
installations. Marine Corps officials also emphasized eliminating
inefficiencies in the areas of installation management and achieving
success without changing the organizational structure used to manage
installations. The Marine Corps uses five broad activities to manage its
O&M appropriations-Pacific forces, Atlantic forces, reserve forces,
logistics, and other activities-and
BOS is a crosscutting program blended into several subactivity groups
across these activities.
Without the centralized installations management structure being used by
the Army and Navy, the Marine Corps has been able to achieve cost savings
and efficiencies. For example, during our visits to Marine Corps bases
Camp Pendleton and Miramar Air Station in California, we found that in
recent years increased management emphasis had been placed on
regionalizing and consolidating resources to reduce costs. For example,
Camp Pendleton is the site of several of the logistical functions for
Marine Corps bases in the region (such as 29 Palms and Miramar), including
a regional contracting office, a regional motor pool, and a central supply
center. According to officials at Camp Pendleton, the regional approach
has already produced savings of more than $1.5 million dollars, and
additional regionalization efforts are being pursued.
The Air Force has integrated BOS and installations management into its
mission activities and continues to manage in a decentralized manner,
using Air Force-level guidance. The Air Force views centralized
installation management as less flexible in providing BOS services than
base-level organizations and less responsive to the urgency and priorities
of the bases' requirements. Air Force major commands are actively engaged
with subordinate commanders in the funding and management of Air Force
installations. The Air Force uses four broad activities to manage its O&M
appropriations-operating forces (air, combat, and space); mobilization;
training and recruiting; and administration and servicewide operations
(logistics, security, international support, and other servicewide
operations). BOS is a crosscutting program blended into several
subactivity groups across these activities.
Without using a centralized installations management structure comparable
to those being used by the Army and Navy, the Air Force has succeeded in
achieving some cost savings and efficiencies. For example, officials at
Randolph Air Force Base, Texas, said they saved $190,000 a year by
consolidating a packaging process at the base's hazardous waste
accumulation facility and were pursuing additional savings by
consolidating and standardizing such services as cell phone contracts,
printers and copy machines, and garbage pickup. In addition, the base had
an active employee self-help program that performed a lot of activities
after hours, including painting walls and buildings, standardizing
workstations, and internal training.
Insufficient Basis for Expanding Centralized Management Concept at This Time
At each of the military installations we visited, we observed reductions
in BOS and S/RM services related to funding constraints. (App. IV
highlights some key impacts of funding shortfalls and redesignations on
BOS and S/RM activities and locations we visited.) BOS services that were
being scaled back or eliminated at the various installations we visited
included the numbers of rescue and firefighter operations; port and
airfield operating hours and accessibility; and recreational and leisure
facilities. We also observed the impacts of delayed maintenance on
facilities, including deterioration of buildings (leaking roofs and
ceilings, energy inefficient windows, and broken stairwells and fire
escapes); breakdown of equipment (heating, ventilation, and air
conditioning and boilers); cracked pavement at airfields; damaged storm
drains and sewer lines; and reduced structural upgrades and replacements
(painting, carpet, and furniture). We also observed reductions in other
O&M funded activities (medical and emergency services). However, there are
many unresolved questions regarding the centralized management agencies'
culpability for the reductions in the levels of BOS and S/RM services that
were being provided at these installations.
As noted above, various Army and Navy installation officials cited growing
pains associated with the centralization of installation management,
including adequacy of funding, services provided, and ability to quickly
respond to shifting needs. At the same time, we recognize that a
centralized approach does offer opportunities to obtain economies and
efficiencies in providing services that may be difficult to attain
otherwise. Nevertheless, until more experience is gained under the
existing centralized approaches, with opportunities to address concerns
identified to date, we are not in a position to endorse expanding the
concept to the other services at this time.
Conclusions DOD's Office of the Deputy Under Secretary of Defense for
Installations and Environment and the services have acknowledged a lack of
common definitions for BOS and standards for BOS services, along with
related difficulties in identifying analytically based BOS funding
requirements. Until these problems are resolved, DOD will not have the
management and oversight framework in place that it needs for identifying
total BOS requirements, providing Congress with a clear basis for making
funding decisions, and ensuring adequate delivery of services,
particularly in a joint environment. Action is needed to expedite
development and consistent implementation of an analytically sound and
consistently applied model for
determining BOS requirements comparable to the approach used in defining
facilities sustainment requirements. Until this is done, uncertainties
will remain concerning actual requirements, and S/RM and other O&M funding
will likely continue to be redesignated to fund BOS costs rather than used
for its intended purpose. Furthermore, as we have previously reported and
continue to note in this report, DOD's installations and facilities have
been insufficiently maintained and recapitalized for several years, a
problem that is exacerbated when S/RM funds are redesignated to cover BOS
programs and services. Thus, the adverse effects on BOS programs and
facility maintenance efforts attributable to moving funds among these
activities can also negatively affect quality of life, morale, and
readiness should these conditions continue. Because DOD is still in the
early stages of developing its BOS initiatives, time frames for
accomplishing many of the specific actions under way or planned have
either not been established or have not been synchronized among the
working groups addressing them.
Recommendations for Executive Action
To better synchronize the efforts and milestones of the various groups
working to improve the management and funding of BOS activities, we
recommend that the Secretary of Defense update DOD's Defense Installations
Strategic Plan to include specific actions and establish time frames
first, to resolve long-standing inconsistencies among the definitions of
BOS services and, second, to help expedite the development and
implementation of an analytically sound and consistently applied model for
determining BOS requirements.
Agency Comments and Our Evaluation
In commenting on a draft of this report, the Deputy Under Secretary of
Defense for Installations and Environment concurred with our
recommendations and indicated that actions were under way or planned to
implement them. He noted that our draft report did not properly
differentiate sustainment programs from restoration and modernization
programs. As suggested, we revised our report to make clearer this
distinction. In addition, he commented that our draft report implied that
each installation should receive funding to match the overall sustainment
rate every year. We did not intend to imply that each installation's
sustainment funding should match exactly the overall rate each year and we
clarified our report accordingly. While we recognize that sustainment
funding at individual installations may vary somewhat from year to year,
we also note that it is often significantly less than one might expect
given
the difference between projected overall levels of funding and what is
actually experienced at the installation level. For example, one
installation we visited received funding for only 45 percent of its
sustainment requirement.
The Deputy Under Secretary of Defense's comments are reprinted in appendix
VI. DOD also provided technical clarifications, which we incorporated as
appropriate.
We are sending copies of this report to interested congressional
committees and members; the Secretary of Defense; the Secretaries of the
Army, Air Force, and Navy; and the Commandant of the Marine Corps. The
report is also available at no charge on GAO's Web Site at
http://www.gao.gov.
If you or your staff have any questions on the matters discussed in this
report, please contact me at (202) 512-5581 or [email protected]. Contact
points for our Offices of Congressional Relations and Public Affairs may
be found on the last page of this report. GAO staff who made major
contributions to this report are listed in appendix VII.
Barry W. Holman, Director Defense Capabilities and Management
Appendix I
Scope and Methodology
To determine the historical funding trends for base operations support
(BOS) as contrasted with funding for facilities sustainment, restoration
and modernization (S/RM), we reviewed financial data, such as budget
requests, congressionally designated amounts as adjusted, and obligations
for fiscal years 2001 through 2004 that we obtained from the Army, Air
Force, Navy, and Marine Corps. We compared funding requirements, budget
requests, adjusted congressionally designated amounts, and obligations
across the services to identify historical trends for BOS and how it
compared with funding for S/RM from the operation and maintenance (O&M)
appropriation. We determined how actual funding for BOS and S/RM compared
with the projected funding requirements identified by individual military
services. We discussed the differences we found with officials from the
Office of the Secretary of Defense (OSD) and the services to obtain a more
thorough understanding of BOS and S/RM funding.
For our historical analyses and for purposes of achieving consistency in
the analyses, we used data provided by each of the military services. In
doing so, we recognize that the funding amounts designated in the
services' accounting records for O&M functional areas such as BOS do not
coincide perfectly with the congressional conference report designations1
that were based on a set of defined but nonetheless diverse program
elements and subactivity groups among the services. Service officials
attributed the variance to their accounting for the BOS services provided
at their respective installations-the number and names of which are
different and expanded from the BOS subactivity groups used for the
conference report-and to funding redesignations that occur during the
year. Accordingly, this report uses the congressional designations as
adjusted by the services' accounting and redesignations of O&M funds for
BOS and S/RM to depict funding trends. (The Department of Defense (DOD) is
currently seeking to restructure these accounts with improved tracking
mechanisms.)
Also, to project trend data more consistently, the historical data
provided by the services and included in this report do not include
congressional adjustments of a one-time nature or supplemental
appropriations for O&M
1 For example, according to historical data provided by the military
services, fiscal year 2004 O&M funding designated for BOS services totaled
$15.6 billion, about $1.6 billion more than Office of the Secretary of
Defense data showed as being designated for BOS at the beginning of the
fiscal year.
Appendix I Scope and Methodology
that Congress provided during a particular fiscal year for such things as
hurricane damage cleanup and repairs or for the Global War on Terrorism.
We did not otherwise independently determine the reliability of the
reported financial information. To determine the impact the funding trends
had on the levels of BOS and S/RM services being provided to individual
activities and installations, we visited and met with officials and viewed
the condition of facilities firsthand at 13 installations across the
country: Randolph Air Force Base, Texas; Tinker Air Force Base, Oklahoma;
Naval Air Station Corpus Christi, Texas; Naval Air Station Kingsville,
Texas; Naval Station Ingleside, Texas; Fort Sam Houston, Texas; Fort
Monroe, Virginia; Fort Eustis, Virginia; Marine Corps Base Camp Pendleton,
California; Miramar Air Station, California; Naval Base San Diego,
California; Naval Base Coronado, California; and Naval Base Point Loma,
California. In addition, we obtained a briefing from officials with the
Naval Air Station Joint Reserve Base at Carswell Field, Fort Worth, Texas.
We also interviewed these officials by telephone. We selected these
installations because they represent a range of BOS programs, missions,
major commands, and geographic locations. We recognize that the conditions
we observed at these 13 installations may not represent conditions at
other DOD installations, and we did not attempt to project the results of
our visits to all military installations.
To evaluate how DOD and the military services forecast BOS requirements
and funding needs, we reviewed OSD, Army, Air Force, Navy, and Marine Corp
information pertaining to base operations requirements and funding and
their roles in the overall base operations process. We reviewed the
processes, planning documents, and proposals that DOD and the services use
to forecast their needs. We interviewed officials from DOD's Office of the
Under Secretary of Defense for Installations and Environment and Senior
Joint Basing Group. To determine the services' definition of BOS, we
interviewed OSD officials and representatives from each of the services
and asked them to provide their working definition of BOS as used to
determine BOS funding requests.
To determine extent to which the Army and Navy reorganizations for
managing installations have affected the quality and level of support
provided to individual activities and installations and whether the Marine
Corps and Air Force would benefit from similar reorganizations, we
reviewed the guidance, procedures, and practices from the Army and Navy
that specifically address reorganization, including comparisons to
prereorganization data. We interviewed officials from the U.S. Army
Installation Management Agency (IMA); IMA Southwest Region; IMA
Appendix I Scope and Methodology
Northeast Region; Commander, Navy Installations (CNI) Command; CNI Region
South; and CNI Region Southwest. We discussed the processes used in the
incipient formation of centralized installation management organizations.
We discussed the effects these changes have had on the planning and
implementation of base operations support services as well as on the
personnel and quality of life at the local level. We contrasted these data
with information obtained from Marine Corps and Air Force officials.
We conducted our review from April 2004 through April 2005 in accordance
with generally accepted government auditing standards.
Appendix II
BOS Functions and Activities Used by the Military Services
Each of the military services has a different approach to BOS and uses
somewhat differing categories and definitions of services included in BOS.
For example, the Army has identified 95 different categories of BOS
functions, and the Navy has identified 124 different categories of BOS
functions. For each service, BOS is a complex group of programs that
support base operations and quality of life. The Office of the Deputy
Under Secretary of Defense for Installations and Environment designated
the improvement of BOS management as a priority and has announced plans to
develop a common definition of BOS services and programs.
BOS Functions and The Army categorizes BOS under nine major service areas.
Within these
broad service areas are 38 specific functions, and within these
functions,Activities Used by the the Army provides 95 different BOS
services. The BOS functions and Army activities used by the Army are shown
in figure 3.
Appendix II
BOS Functions and Activities Used by the
Military Services
Figure 3: Army BOS Functions and Activities
Financial Laundry/ Force Information Retail Safety and technologyMedical
Contracting management Emergency dry cleaning protection management
services occupational services health and planning
Contracting Management Environmental Food Installation Installation Dental
administration analysis services services intel/security Administrative
Education management services
Other Morale,Preventive engineering Transportation Visual welfare, and
Inspector
medicine services services information recreation general systems
MilitaryVeterinary Real property Materiel Communication personnel Public
affairs
medicine management maintenance systems and support
systems
support Civilian
Housing Supply personnel Chaplain
management management management
Facilities Staff judge
maintenance Supply advocate management operations
95 services within 9 major service areas and 38 functions
Source: GAO analysis of Army data.
Provost marshall
Appendix II
BOS Functions and Activities Used by the
Military Services
BOS Functions and The Navy categorizes BOS under operating forces support,
community
Activities Used by the Navy support, and base support programs. Within
these general categories, nine major service areas are broken down into 29
functions. These functions are broken down further to include 124 BOS
services such as food service contracts, recreation, and so forth. The BOS
functions and activities used by the Navy are shown in figure 4.
Figure 4: Navy BOS Functions and Activities
Airfield Port Other Morale, Family Force
operations services operations welfare, and housing Utilities Compliance
protection Command support recreation
Aviation Other port Child Bachelor Facility Resource quarterssupport
operations Supply development operations management Conservation Federal
fire management
Sustainment, Pollution Disaster Information
Galley restoration, prevention preparation technology and services
modernization
Fleet and Facility Military family support services Safety personnel
services
124 services within 9 major service areas and 29 functions
Source: GAO analysis of Navy data.
Note: Sustainment, restoration, and modernization are included under the
base support functional area to recognize the close interrelationship that
exists between them. For example, sustainment funds may be used to fix a
leaking roof in a building that houses a BOS activity.
Appendix II
BOS Functions and Activities Used by the
Military Services
BOS Functions and The Marine Corps categorizes its BOS functions and
activities under seven Activities Used by the major service areas. Within
these broad service areas are 37 BOS services. Marine Corps The BOS
functions and activities used by the Marine Corps are shown in
figure 5.
Figure 5: Marine Corps BOS Functions and Activities
Source: GAO analysis of Marine Corps data.
Appendix II
BOS Functions and Activities Used by the
Military Services
BOS Functions and The Air Force provides BOS functions and services within
its four broad Activities Used by the mission areas-operating forces,
mobilization, training and recruiting, and Air Force administration and
servicewide activities. Within these mission areas are 11
functional areas. These functional areas are the framework for 63 BOS
services. The BOS functions and activities used by the Air Force are shown
in figure 6.
Figure 6: Air Force BOS Functions and Activities
Air operations Mobility operations
Accession training
Logistics operations
Combat related
Space operations
Basic skills and advanced training
Service-wide activities
Security operations
Support to other nations Recruiting, other training, and education
63 services within 4 major operational areas and 11 functions. Base
operation support functions are incorporated in the 63 services.
Source: GAO analysis of Air Force data.
Appendix III
Army and Navy Base Operations Support Management Structure
Army Installation Prior to the establishment of IMA, 15 major commands
managed base operations for the Army. IMA was created on October 1, 2002,
to attain
Management Agency efficiencies from consolidating BOS services for the
Army worldwide. As shown in figure 7, the activities, personnel, and
services for base operations previously associated with the major commands
were realigned under one organization with the establishment of IMA.
Figure 7: Army Installation Management Agency Organization
1 installation 1 installation 6 installations 2 installations 3 installations 8
installations 2 installations
Source: Army.
Appendix III Army and Navy Base Operations Support Management Structure
Management decisions and funding designations now flow through IMA
headquarters and its seven regional offices, four in the continental
United States and three overseas, directly to installations for execution.
IMA's intent with this structure is to support and enable mission
commanders, achieve regional efficiencies, and provide consistent and
equitable facilities and services with common standards. According to IMA
officials, seven regions is the right size for efficient management;
however, they said they would revisit their organizational structure
following the outcome of the 2005 round of base realignment and closure.
Figure 8 shows IMA's current locations.
Figure 8: Army Installation Management Agency Locations
Source: Army.
Appendix III Army and Navy Base Operations Support Management Structure
Commander, Navy Installations
A key event leading to the creation of CNI occurred in 1998 when the Navy
consolidated or "regionalized" installation management functions.
Regionalization was done to reduce BOS costs through the elimination of
unnecessary management layers, duplicative overhead, and redundant
functions. In conjunction with regionalization, the Navy reduced the
number of its major claimants involved in the installation management
business from 18 to 8. To further reduce costs the Navy stood up CNI in
October 2003, further consolidating the Navy's installation management
business under a single claimant. The CNI organization is shown in figure
9.
Appendix III Army and Navy Base Operations Support Management Structure
Figure 9: CNI Organization
Source: Navy.
Note : Special assistants include Force Judge Advocate, Inspector General,
Safety, Command Master Chief, Chief Information Officer, Public Affairs
Officer, General Counsel, Chaplain, and Comptroller.
Appendix III Army and Navy Base Operations Support Management Structure
As shown in figure 10, CNI is organized into 16 regions, 10 in the
continental United States and 6 overseas. At the time of this report there
was discussion regarding the possibility of further consolidating CNI's
regional structure. According to CNI officials, maintaining 16 regions may
be more than is ultimately needed for the most efficient management
structure; however, they said any decision to consolidate further would
depend on the outcome of the 2005 round of base realignment and closure.
Singapore
Korea
Regional commanders
Source: Navy.
Appendix IV
Impact of Funding Constraints on BOS and S/RM Activities
At each of the military installations we visited, we observed reductions
in BOS and S/RM services related to funding constraints. BOS services that
were being scaled back or eliminated at the various installations that we
visited included the numbers of rescue and firefighter operations,
airfield and port operating hours and accessibility, and recreational and
leisure facilities. We also observed the impacts of delayed maintenance on
facilities, including deterioration of buildings (leaking roofs and
ceilings, energy inefficient windows, and broken stairwells and fire
escapes); breakdown of equipment (heating, ventilation, and air
conditioning and boilers); cracked pavement at airfields; damaged storm
drains and sewer lines; and reduced structural upgrades and replacements
(painting, carpet, and furniture). We also observed reductions in other
O&M funded activities (medical and emergency services).
Observations at Army Installations
Fort Eustis, Virginia Created in 1918, Fort Eustis is the home of the U.S.
Army Transportation Corps and the Transportation Corps Regiment. At Fort
Eustis and its satellite installation, Fort Story, officers and enlisted
soldiers receive education and on-the-job training in all modes of
transportation, aviation maintenance, logistics, and deployment doctrine
and research. Officials told us that BOS funding shortfalls at Eustis have
had some indirect impacts on training. For example, reductions in dining
hall support may be a contributing factor to long lines in dining
facilities, potentially causing soldiers to be tardy for training classes.
We found indications of Fort Eustis's barracks needing repairs. Mold and
deteriorating stairwells were an issue in the older barracks. Delayed
barracks renovations include adding nonskid tracking to the stairwells and
replacing cracked sinks in the bathrooms. Officials also said that Fort
Eustis has deteriorated fencing, road paving, and heating and air
conditioning for training facilities. Officials also showed us mission
facilities with repair needs that have not been completed due to funding
issues. At Fort Eustis's third port, concrete is crumbling and the repair
of airfield hangar doors, roofs, and heating and air conditioning systems
and routine maintenance of training facilities have yet to be completed.
Appendix IV Impact of Funding Constraints on BOS and S/RM Activities
Public works officials at Fort Eustis also told us about storm drains that
have been damaged and clogged by tree roots. They have similar problems
with their sewer lines.
Fort Monroe, Virginia Fort Monroe is located in the city of Hampton,
Virginia, and is headquarters of the Army's Training and Doctrine Command,
which supports the Army's fighting forces through the development of
doctrine and equipment requirements and training for combat. We observed a
training facility that had extensive termite damage; to keep the facility
in use, support beams had been added to the flooring to prevent it from
caving in. Fort Monroe also closed several fire escapes due to eroding of
the structures; had rusted and peeling metal staircases; and had heating,
ventilation, and air conditioning systems that need to be overhauled.
At the installation's marina, we also saw evidence of delayed repairs due
to funding constraints. The foundation of the facility had rust and cracks
caused by high tides, and pieces of the building were falling off.
According to installation officials, the marina repairs, estimated to cost
at least $300,000, have been backlogged for 3 to 4 years.
Fort Sam Houston, Texas In 1876, the Army began to move its facilities to
the present site of Fort Sam Houston. Today, Fort Sam Houston is
headquarters for various activities including the Army Medical Command,
Fifth U.S. Army, U.S. Army South, and Brooke Army Medical Center. We
observed some buildings and roads in need of repairs. We obtained
information showing that, due to funding shortages in the BOS area, S/RM
funds for painting projects, electrical repairs, and other preventive
maintenance were being redesignated to pay for BOS services.
Observations at Navy Installations
Naval Air Station Corpus Naval Air Station Corpus Christi started its
first flight training on
Christi, Texas May 5, 1941. Its general command assignment is still pilot
training, as headquarters for the Chief of Naval Air Training. However,
recent cutbacks in BOS services reportedly constrained airfield
operations, leading to
Appendix IV Impact of Funding Constraints on BOS and S/RM Activities
overdue repairs and reduced hours of operation. A Coast Guard tenant
representative told us about several airfield conditions that need repair.
For example, we were told that deteriorating power systems were prone to
failure, and when the power goes off, security gates have to be opened
manually to access runways. Aged and unreliable hangar doors also delayed
some launches. We were told that the naval base has been closing its field
operations at night to reduce operational costs. As a result, Coast Guard
tenants are uncertain whether runway lights will come on when their
aircraft are landing late at night or whether the tower will answer their
calls. Lastly, Corpus Christi Air officials said that they could not
afford to pay for the required number of on duty firefighters at the
airfield. To prevent the cancellation of training efforts and other air
operations, the airfield operated under a safety waiver whereby no manned
fire truck had to be present on the landing strip.
Funding shortages also reportedly caused cutbacks in services at the Naval
Hospital at Corpus Christi. Officials told us that due to decreased O&M
funding, the hospital now operates as a clinic in terms of the level of
services it is able to provide and that it refers some patients to other
hospitals. Other reductions in services attributed to cost-saving measures
at Corpus Christi included reducing pool hours from 42 to 20 hours per
week (saving $50,000 for the year) and closing the enlisted members club
at the installation. Base officials said it is less desirable for military
personnel to go off base for entertainment and leisure services.
Due to the lack of S/RM funding, base officials identified some barracks
that were in poor condition. Officials showed us buildings with leaking
roofs and water damage and mold. For example, a mold problem at one newly
constructed housing facility was attributed to a design defect involving
the placement of air conditioning vents, and officials estimated it would
cost $1.6 million, which they did not have, to correct the problem.
Naval Base Coronado, California
Established in 1917, Naval Base Coronado comprises two main units: the
Naval Air Station North Island and Naval Amphibious Base Coronado. North
Island itself plays host to 23 squadrons and 80 additional tenant
commands. Officials from tenant organizations told us that the number of
fire fighters had been reduced due to BOS funding constraints.
Specifically, they said that there are supposed to be a total of 10
firefighters on duty-6 for fire response to facilities and housing areas
and 4 for the airfield-but the number of firefighters on duty is being
reduced to 4. Officials said that when the firefighters have to respond to
a structural fire
Appendix IV Impact of Funding Constraints on BOS and S/RM Activities
on base, the airfield would be without fire protection and would have to
shut down. Navy officials stated that the level of fire protection at
Naval Base Coronado is in full compliance with DOD and Navy requirements.
Officials said that because they have not had the amounts of S/RM funds
needed to perform sufficient levels of maintenance and repairs, they have
the following conditions at their facilities: frayed carpeting and rotted
wood in barracks, broken water pipes, balcony railings with corrosion,
cracked shower doors, poor shower drainage, and mold.
Naval Air Station Kingsville, Naval Air Station Kingsville was
commissioned in July 1942, and its primary
Texas mission is to train tactical jet pilots. Officials told us that
several safety and security projects supporting this mission were
eliminated due to lack of funding. For example, there is no longer an
emergency response team on base. Therefore, if an accident occurs during a
training operation, the base has to rely on emergency response from the
local community. Also, as a result of limited O&M funding, there were no
dentists at the dental clinic and no emergency services available at the
medical clinic.
Naval Base San Diego, California
Naval Base San Diego was established on February 23, 1922, as a destroyer
base and later was named a naval repair base. Today, the base provides a
wide range of both direct and indirect fleet support, including waterfront
operations, security, supply, civil engineering, and many other
administrative and leisure functions. Officials cited tugboat support as
an example of a support program that has been scaled back due to the lack
of BOS-designated funding. They said that the base had scaled back its
number of operating tugs from six to four, but port officials could not
meet mission requirements with fewer tugs. The number of tugs was
subsequently increased to five. In other cost-saving initiatives, San
Diego has recently scaled back its transportation service and uses vans
instead of buses, has reduced the number of firefighters on duty, and is
considering closing its driving range and officer's club. The library has
also been closed, and due to mold problems, the child development center
has been closed.
Naval Base Point Loma, On October 1, 1998, six installations were
consolidated as Naval Base Point
California Loma. Point Loma provides support services for submarines in
the U.S. Pacific Fleet. In carrying out its mission to provide quality of
life services for the operating forces, Point Loma is also the site of the
Navy Alcohol
Appendix IV Impact of Funding Constraints on BOS and S/RM Activities
Rehabilitation Center. We found examples of reductions in several leisure
and recreational services due to BOS funding shortages in fiscal year
2004. For example, Point Loma has closed two libraries and an auto body
shop, and is considering the possibility of closing a chapel. Also closed
are the outdoor equipment rental facility and the leisure travel office.
We also found several unattended maintenance issues at Point Loma. For
instance, due to reduced maintenance, some barracks needed painting and
new carpet. Installation officials complained about brown water in the
drains of older barracks as well as leaking roofs. They also told us that
windows are not energy efficient, which drives up energy costs, and that
several parking lots needed to be repaved.
Naval Station Ingleside, Texas
Naval Station Ingleside is one of three south Texas installations in Naval
Region South. Ingleside's mission is to provide logistics and base support
services to 41 commands-including 21 ships and 3,900 personnel-that make
up the Mine Warfare forces. As a result of budget constraints experienced
in fiscal year 2004, Ingleside officials told us they had to reduce port
operations working hours from 24 hours a day, 7 days per week, to 12 hours
per day, 5 days per week; reduce overtime for personnel involved ship
movements in port by 30 percent; and reduce personnel involved in various
BOS programs.
Observations at Marine Corps Installations
Marine Corps Air Station Miramar, California
On October 1, 1997, Naval Air Station Miramar was renamed Miramar Marine
Corps Air Station as a part of a DOD realignment. Marine Corps Air
Stations El Toro and Tustin were closed and their assets moved to Miramar
by the end of 1999. Miramar is home for eight Hornet jet squadrons, four
Super Stallion helicopter squadrons, one KC-130 transport and refueling
squadron, and nine station support aircraft.
Several unexpected expenses affected the BOS funding needs at Miramar
during fiscal year 2004. Although electricity rates increased by more than
70 percent, there was no corresponding increase in BOS funding to cover
these unanticipated increases. To offset some of the costs, Miramar and
Appendix IV Impact of Funding Constraints on BOS and S/RM Activities
other Marine Corps installations increased tenant rates for utility
services and obtained $2.3 million in supplemental funding. In an effort
to stop programs from moving mission operations funds to pay for BOS
programs, the installation reduced services of less essential,
non-mission-related projects, such as furniture and carpet replacement.
Camp Pendleton, California Camp Pendleton was established in September
1942. Camp Pendleton is an amphibious training facility and offers a wide
array of training facilities, including firing ranges, landing beaches,
parachute drop zones, and mock urban warfare towns. But in providing this
training support, Pendleton anticipates a shortfall in BOS funding for
fiscal year 2005. For example, utilities' costs are projected to be higher
than the budgeted amount. Disaster preparedness may also be constrained
because quantities of gas masks and advanced emergency communications
systems have also not been funded.
Other programs at Camp Pendleton have also been delayed due to funding
constraints. Base officials told us that some construction projects have
been funded, but the new infrastructure creates an additional demand for
BOS services that the installations are fiscally unable to provide. For
example, Marine Corps Headquarters has $750,000 of military construction
money to build permanent latrine facilities. However, the installation
cannot afford to install plumbing on that side of the base nor does it
have the money to furnish, service, or maintain the new facility.
Officials told us that several new vehicles have been purchased, but no
additional funding has been provided to cover the associated costs of new
maintenance tools, garages, or fuel. In addition, there is a backlog in
providing new furniture because funding was being used to cover other BOS
expenses.
Observations at Air
Force Installations
Randolph Air Force Base, Randolph Air Force Base was dedicated on June 20,
1930 as a flying
Texas training base and continues that mission today. More specifically,
the installation is one of the few bases that does instructor pilot
training, and it is also home to Joint Undergraduate Navigator and
Electronic Warfare Officer Training. To cut costs at the installation,
Randolph has implemented
Appendix IV Impact of Funding Constraints on BOS and S/RM Activities
some changes to BOS services such as custodial and dining hall support.
For instance, Randolph increased waste container sizes and reduced the
number of waste collections to once per week, performed custodial services
after hours when they could be done in less time by avoiding the presence
of workers, and cut the dining hall budget.
Shortfalls in S/RM funding have also led to the deferring of routine
facilities maintenance at Randolph. Officials told us about reports of
rusted drinking water pipes, oil in one of the water wells, and mold and
water damage from leaking water pipes.
Tinker Air Force Base, Oklahoma
Tinker Air Force Base was established on April 8, 1941, as a maintenance
and repair depot. Today, Tinker's largest organization is the Oklahoma
City Air Logistics Center, one of three depot repair centers in the Air
Force Materiel Command. Tinker is also home to seven major Department of
Defense, Air Force, and Navy activities with critical national defense
missions. These activities include the 552nd Air Control Wing (which flies
the E-3 Sentry aircraft and is part of the Air Force's Air Combat Command
mobile strike force); the Navy's Strategic Communications Wing ONE (a one
of a kind unit in the Navy that provides a vital, secure communications
link to the submerged fleet of ballistic missile submarines); and the
507th Air Refueling Wing (an Air Force Reserve flying unit).
Tinker has contracted with the private sector for much of its BOS and has
reported selective consolidations and efficiency measures to improve BOS
operations and achieve savings. For instance, mail service pickup and
delivery were reduced from twice to once per day, fire department
inspections and repair and replacements of fire extinguishers were
postponed, and worn carpet was not being replaced.
Appendix V
Navy, Marine Corps, and Air Force Funding Trends
Navy Funding Trends Available Navy data show differences between amounts
the Navy projected as required for BOS and amounts included in budget
requests, designated, and actually obligated each fiscal year from 2001
through 2004 (see fig. 11). As it did for the Army, Congress gave the Navy
increasing funding for BOS in some years, but we found a smaller
difference between identified requirements and funding here than in the
Army.
Figure 11: Navy BOS Funding, Fiscal Years 2001-04
Dollars in millions
4,500
4,000
3,500
3,000
2,500
2,000
1,500
1,000
500
0 2001 2002 2003 2004
Requirements President's budget Congressionally designated amounts,
adjusted by the Navy Amount obligated Source: GAO analysis of Navy data.
Notes:
(1) Dollars are in constant fiscal year 2004 dollars.
(2) Navy officials indicated they had not had models for projecting
requirements during these budget years but, as discussed in an earlier
section of this report, are taking steps to improve their requirements
determination process for BOS funding.
(3) Obligations exceeded adjusted congressionally designated amounts as a
result of authorized internal adjustments among accounts. For example, as
discussed below, the Navy moved S/RM funds into the BOS account.
Appendix V Navy, Marine Corps, and Air Force Funding Trends
The difference between the Navy's congressionally designated funding and
obligations also appears to be smaller than that for the Army, but the
Navy's obligations for BOS still were greater than its congressionally
designated amounts for BOS as adjusted by the Navy. For example, in fiscal
year 2004, the Navy's BOS obligations-$3.427 billion-were more than its
BOS funding-$3.217 billion. As in the Army, Navy officials said the
difference between the congressionally designated amounts for BOS
services, as adjusted by the Navy, and the amounts obligated is made up of
funds moved from S/RM activities to BOS activities to pay "must pay bills"
such as utilities and, increasingly, to obtain contactor services. This
also indicates a continuation of the historic trend of funds being moved
among various O&M subaccounts during the year. Navy installation officials
also reported instances of funds being withheld during the year and being
redesignated to support warfighting needs. More specifically, we were told
that the Navy withheld $300 million in O&M funds, including $199 million
that otherwise would have been designated to fund BOS and $101 million to
fund S/RM, to help pay for the Global War on Terrorism. Navy officials
told us that during the year they had to scale back and cut BOS programs
and move $504 million from S/RM to pay for essential BOS services until
supplemental funding became available and they could move funds back to
S/RM.
Navy S/RM funding trend data displayed in figure 12 show a spike in
congressionally designated amounts adjusted by the Navy and obligations in
fiscal year 2003. According to Navy officials, 2003 was simply a
better-funded year for Navy shore facilities infrastructure than other
years. However, in fiscal year 2004, S/RM services were affected by the
Navy's withholding of O&M funds during the year, that otherwise would have
been designated to fund BOS and facilities sustainment, to instead help
pay for the Global War on Terrorism. Similar problems are reportedly
occurring in fiscal year 2005. The Navy obligated fewer funding dollars
for facilities sustainment activities in fiscal year 2004 than were
initially designated. Although the Navy also received supplemental funding
for the Global War on Terrorism for BOS and facilities sustainment
activities, such turbulence occurring during the year makes it difficult
to execute planned programs effectively and resulted in the Navy's
underexecuting its facilities sustainment program by $393 million in
fiscal year 2004. As we have previously reported, such problems adversely
affect efforts to maintain facilities and provide base support services.
Appendix V Navy, Marine Corps, and Air Force Funding Trends
Dollars in millions 1,600
1,400
1,200
1,000
800
600
400
200
0 2001 2002 2003 2004
Requirements
President's budget
Congressionally designated amounts, adjusted by the Navy
Amount obligated
Source: GAO analysis of Navy data.
Notes:
(1) Dollars are in constant fiscal year 2004 dollars.
(2) Navy officials indicated they had improved S/RM requirements forecasts
by using the DOD facilities sustainment model developed in 1999.
(3) Obligations were different from congressionally designated amounts,
adjusted by the Navy, as a result of authorized internal adjustments among
accounts. For example, as discussed above, during fiscal year 2004 the
Navy moved S/RM funds into the BOS account.
Marine Corp Funding Available data show some differences between amounts
the Marine Corps
Trends projected as required for BOS and amounts included in budget
requests, amounts designated, and amounts actually obligated each fiscal
year from 2001 through 2004, with some increase in projected requirements,
requests and funding occurring in recent years (see fig. 13).
Appendix V Navy, Marine Corps, and Air Force Funding Trends
Dollars in millions 1,200
1,000
800
600
400
200
0 2001 2002 2003 2004
Requirements
President's budget
Congressionally designated amounts, adjusted by the Marine Corps
Amount obligated
Source: GAO analysis of Marine Corps data.
Notes:
(1) Dollars are in constant fiscal year 2004 dollars.
(2) Marine Corps officials indicated they had not had models for
projecting requirements during these budget years but, as discussed in an
earlier section of this report, are taking steps to improve their
requirements determination process for BOS funding.
(3) Obligations fell short of congressionally designated amounts, as
adjusted by the Marine Corps, for fiscal years 2002 and 2003 and exceeded
adjusted congressionally designated amounts in fiscal years 2001 and 2004
as a result of authorized internal adjustments among accounts. For
example, as discussed below, the Marine Corps moved S/RM funds into the
BOS account.
The trend data present more of a mixed picture for the Marine Corps in
terms of obligations when contrasted with data for the other military
services. In 2 of 4 years the Marine Corps' obligations were greater than
congressionally designated amounts, as adjusted by the Marine Corps, as
well as projected requirements. For example, in fiscal year 2004, the
Marine Corps' BOS obligations of $1.164 billion were $54 million more than
its designated funding ($1.110 billion), representing a movement of funds
from other accounts to support BOS activities.
Appendix V Navy, Marine Corps, and Air Force Funding Trends
S/RM trend data show that the Marine Corps obligated more funding than
adjusted congressionally designated amounts in fiscal years 2001 and 2003,
and it obligated less funding than adjusted congressionally designated
amounts in fiscal year 2004. Marine Corps officials said the differences
were due to funds being moved and redesignated among BOS and S/RM accounts
(see fig. 14).
Figure 14: Marine Corps S/RM Funding, Fiscal Years 2001-04
Dollars in millions
700
600
500
400
300
200
100
0 2001 2002 2003 2004
Requirements
President's budget
Congressionally designated amounts, adjusted by the Marine Corps
Amount obligated Source: GAO analysis of Marine Corps data.
Notes:
(1) Dollars are in constant fiscal year 2004 dollars.
(2) Marine Corps officials indicated they had improved S/RM requirements
forecasts in fiscal year 2004 by using DOD's facilities sustainment model.
(3) Obligations were different from congressionally designated amounts as
adjusted by the Marine Corps, as a result of authorized internal
adjustments among accounts. For example, during fiscal year 2004 the
Marine Corps moved S/RM funds into the BOS account.
As shown by figure 14, in fiscal year 2004, adjusted congressionally
designated amounts were about 98 percent of the projected S/RM
requirement. However, the Marine Corps underexecuted its S/RM program
Appendix V Navy, Marine Corps, and Air Force Funding Trends
by $59.2 million in fiscal year 2004. This underexecution occurred
because, as noted above, the Marine Corps redesignated millions of dollars
of S/RM funds to cover the difference between designated BOS funding and
BOS obligations.
Air Force Funding Trends Data were not readily available to provide a
trend in the Air Force's projected BOS requirements.1 Funding trend data
for BOS services and programs within the Air Force show that budgetary
requests, designated funding, and BOS obligations remained more closely
aligned than was the case for the other services in most years.
Nevertheless, some differences do exist between budget requests,
designated funding, and obligations. As shown by figure 15, only in fiscal
year 2004 were BOS obligations-$4.896 billion-less than the
congressionally designated amounts, as adjusted by the Air Force-$5.260
billion. This indicates that BOS funds were being redesignated to meet
other needs in that year, but funds from other O&M accounts were
redesignated to BOS in earlier years. Air Force headquarters officials
told us that rather than being headquarters directed, the Air Force relied
on its major commands to redesignate BOS and S/RM funds as needed for the
Global War on Terrorism and to decide which BOS programs and services
would be scaled back.
1 Although the Army, Navy, and Marine Corps were able to provide
information on requirements, Air Force officials indicated that to do so
would require extraordinary efforts to accumulate data from individual
installations and commands, and they did not view such unrefined
requirements data as necessarily representative of true requirements.
Appendix V Navy, Marine Corps, and Air Force Funding Trends
Figure 15: Air Force BOS Funding, Fiscal Years 2001-04
Dollars in millions
7,000
6,000
5,000
4,000
3,000
2,000
1,000
0 2001 2002 2003 2004
President's budget
Congressionally designated amounts, adjusted by the Air Force
Amount obligated
Source: GAO analysis of Air Force data.
Notes:
(1) Dollars are in constant fiscal year 2004 dollars.
(2) Air Force officials indicated they had not had models for projecting
requirements during these budget years but, as discussed in an earlier
section of this report, are taking steps to improve their requirements
determination process for BOS funding.
(3) Obligations were different from congressionally designated amounts, as
adjusted by the Air Force, as a result of authorized internal adjustments
among accounts. For example, as discussed below, the Air Force moved BOS
funds into the S/RM account.
Appendix V Navy, Marine Corps, and Air Force Funding Trends
Air Force trend data for S/RM activities during fiscal years 2001 through
2004 show that obligations were greater than designated funding or budget
requests in each of the 4 years. According to Air Force officials, BOS
funds were redesignated by installation commanders in fiscal year 2004 to
supplement S/RM funds. Since both BOS and S/RM obligations exceeded their
funding designations in fiscal years 2001, 2002, and 2003, this would
suggest that funds were redesignated to these areas from other O&M
activities in those years (see fig. 16).
Figure 16: Air Force S/RM Funding, Fiscal Years 2001-04
Dollars in millions
3,500
3,000
2,500
2,000
1,500
1,000
500
0 2001 2002 2003 2004
President's budget
Congressionally designated amounts
Amount obligated
Source: Air Force
Notes:
(1) Dollars are in constant fiscal year 2004 dollars.
(2) Obligations exceeded adjusted congressionally designated amounts as a
result of authorized internal adjustments among accounts. For example, as
discussed above, in fiscal year 2004, the Air Force moved BOS funds into
the S/RM account.
Appendix VI
Comments from the Department of Defense
Appendix VI
Comments from the Department of Defense
Note: Page numbers in the draft report may differ from those in this
report.
Appendix VII
GAO Contact and Staff Acknowledgments
GAO Contact Barry W. Holman (202) 512-5581
Acknowledgments
In addition to the individual named above, Latasha Brown, Erica Haley,
Mark Little, Erica Miles, Tanisha Stewart, Roger Tomlinson, Cheryl
Weissman, and Michael Zola made key contributions to this report.
Related GAO Products
Defense Infrastructure: Long-term Challenges in Managing the Military
Construction Program. GAO-04-288. Washington, D.C.: February 24, 2004.
Defense Infrastructure: Changes in Funding Priorities and Management
Processes Needed to Improve Condition and Reduce Costs of Guard and
Reserve Facilities. GAO-03-516. Washington, D.C.: May 15, 2003.
Defense Infrastructure: Changes in Funding Priorities and
Strategic Planning Needed to Improve the Condition of Military
Facilities. GAO-03-274. Washington, D.C.: February 19, 2003.
Defense Management: Army Needs to Address Resource and
Mission Requirements Affecting Its Training and Doctrine Command.
GAO-03-214. Washington, D.C.: February 10, 2003).
Defense Budget: Real Property Maintenance and Base Operations Fund
Movements. GAO/T-NSIAD-00-101. Washington, D.C.: March 1, 2000.
Defense Budget: Analysis of Real Property Maintenance and Base
Operations Fund Movements. GAO/NSIAD-00-87. Washington, D.C.: February 29,
2000.
Defense Budget: DOD Should Further Improve Visibility and
Accountability of O&M Fund Movements. GAO/NSIAD-00-18. Washington, D.C.:
February 9, 2000.
DOD Budget: Budgeting for Operation and Maintenance Activities.
GAO/T-NSIAD-97-222. Washington, D.C.: July 22, 1997.
Depot Maintenance: Some Funds Intended for Maintenance Are Used for
Other Purposes. GAO/NSIAD-95-124. Washington, D.C.: July 6, 1995.
Army Training: One-Third of 1993 and 1994 Budgeted Funds Were Used
for Other Purposes. GAO/NSIAD-95-71. Washington, D.C.: April 7, 1995.
GAO's Mission
The Government Accountability Office, the audit, evaluation and
investigative arm of Congress, exists to support Congress in meeting its
constitutional responsibilities and to help improve the performance and
accountability of the federal government for the American people. GAO
examines the use of public funds; evaluates federal programs and policies;
and provides analyses, recommendations, and other assistance to help
Congress make informed oversight, policy, and funding decisions. GAO's
commitment to good government is reflected in its core values of
accountability, integrity, and reliability.
Obtaining Copies of The fastest and easiest way to obtain copies of GAO
documents at no cost
is through GAO's Web site (www.gao.gov). Each weekday, GAO posts GAO
Reports and newly released reports, testimony, and correspondence on its
Web site. To Testimony have GAO e-mail you a list of newly posted products
every afternoon, go to
www.gao.gov and select "Subscribe to Updates."
Order by Mail or Phone
The first copy of each printed report is free. Additional copies are $2
each. A check or money order should be made out to the Superintendent of
Documents. GAO also accepts VISA and Mastercard. Orders for 100 or more
copies mailed to a single address are discounted 25 percent. Orders should
be sent to:
U.S. Government Accountability Office 441 G Street NW, Room LM Washington,
D.C. 20548
To order by Phone:
Voice: (202) 512-6000 TDD: (202) 512-2537 Fax: (202) 512-6061
To Report Fraud, Contact: Waste, and Abuse in Web site:
www.gao.gov/fraudnet/fraudnet.htm
E-mail: [email protected] Federal Programs Automated answering system:
(800) 424-5454 or (202) 512-7470
Congressional
Gloria Jarmon, Managing Director, [email protected] (202) 512-4400 U.S.
Government Accountability Office, 441 G Street NW, Room 7125
Relations Washington, D.C. 20548
Public Affairs
Paul Anderson, Managing Director, [email protected] (202) 512-4800 U.S.
Government Accountability Office, 441 G Street NW, Room 7149 Washington,
D.C. 20548
Presorted Standard
Postage & Fees Paid
GAO
Permit No. GI00
United States
Government Accountability Office
Washington, D.C. 20548-0001
Official Business
Penalty for Private Use $300
Address Service Requested
*** End of document. ***