United States Government Publishing Office publisher pbl distributor dst United States Government Accountability Office National Security and International Affairs Division author aut Government Organization text government publication eng GAOREPORTS Legislative Agency Publications gao legislative 2010-08-12 U.S. Government Printing Office 1999-04-15 monographic deposited born digital 32 p. GA 1.13:NSIAD-99-72 https://www.govinfo.gov/app/details/GAOREPORTS-NSIAD-99-72 P0b002ee18038825d f:ns99072 DGPO 2010-08-12 2011-03-28 GAOREPORTS-NSIAD-99-72 machine generated eng fdlp REPORT GAOREPORTS-NSIAD-99-72 NSIAD-99-72 Military bases Prices and pricing Financial institutions Revenue sharing Evaluation criteria Competition Bid evaluation Fair market value Electronic funds transfer Savings and loan associations Other Written Product NSIAD

Pursuant to a legislative requirement, GAO provided information on the Department of Defense's (DOD) domestic banking program on military bases, focusing on whether: (1) domestic military bases have followed DOD procedures to provide for open solicitations in obtaining banking services; (2) on-base financial institutions face competition for banking services from other financial institutions and charge fees competitive with other banks; and (3) opportunities exist for DOD and military bases to generate additional revenues from banking services on military bases and how this might affect banking services and customers. GAO noted that: (1) in the 15 instances where domestic military bases sought banking services since 1996, the military services openly solicited proposals from financial institutions and selected from among the proposals to authorize a bank or credit union to operate on the base, as required by DOD regulations; (2) 11 of the solicitations resulted in 2 or fewer responses; (3) in a few instances where no proposals were received, DOD had to take special action to obtain banking services; (4) GAO learned of no unsolicited proposals from financial institutions to provide banking services on other bases; (5) when a base received more than one proposal, commanders cited a range of factors on which they based their selection decisions, such as fees, operating hours, or services; (6) the applicable regulations and instructions do not contain specific guidance for this selection process; (7) solicitations did not specify selection criteria or the weights associated with various factors considered; (8) the lack of clear selection criteria makes it difficult to know the basis for selection and ensure fairness in the selection process; (9) financial institutions on military bases face significant competition both on and off the base; (9) less than half of DOD's personnel use an on-base financial institution as their primary banking provider, according to a 1997 DOD survey; (10) on many bases, a bank and a credit union compete for business with each other and with off-base financial institutions; (11) fees charged by base financial institutions were close to the national average and within the range charged by all banks, on or off base; (12) a few options exist for potentially generating additional revenues for DOD from financial institutions operating on its bases; how successful such options would be is unclear, and customers and banking services could be adversely affected; (13) given that many banks' lease agreements on military bases extend to 25 years, DOD could raise an unknown amount of additional revenue by incorporating in new leases and operating agreements the requirement to periodically renegotiate lease payments based on changes in fair market value, although there is some risk that lease payments might decline; (14) DOD could negotiate automated teller machine (ATM) fee-sharing arrangements, as is sometimes done in the private sector; (15) DOD could competitively solicit ATM placements apart from other banking services; (16) the amount of additional revenues that could be obtained would vary by market conditions, including customers' reactions to likely increases in ATM charges. https://www.govinfo.gov/content/pkg/GAOREPORTS-NSIAD-99-72/html/GAOREPORTS-NSIAD-99-72.htm https://www.govinfo.gov/content/pkg/GAOREPORTS-NSIAD-99-72/pdf/GAOREPORTS-NSIAD-99-72.pdf GAO/NSIAD-99-72 https://www.govinfo.gov/app/details/GAOREPORTS-NSIAD-99-72 Other Written Product GAO/NSIAD-99-72; Military Banking: Solicitations, Fees, and Revenue; Military bases Prices and pricing Financial institutions Revenue sharing Evaluation criteria Competition Bid evaluation Fair market value Electronic funds transfer Savings and loan associations Title 10 Section 2302 Title 10 Section 2303(a) Title 10 Section 2667 Title 10 Section 2667(d) 10 U.S.C. 2302 10 U.S.C. 2303(a) 10 U.S.C. 2667 10 U.S.C. 2667(d) Title 12 Section 1770 12 U.S.C. 1770 Title 31 Section 3302(b) 31 U.S.C. 3302(b) H. Rept. 105-532 H. Rept. 105-746