Since September 2001, DOD has  activated about 300,000 of the 1.2 million National Guard and Reserve  personnel. During the summer of 2003, public concerns were raised in the Tampa  area about the practices used at MacDill to acquire off-base lodging for  reservists and temporary office space for coalition partners in the war  against Iraq. Questions were also raised about whether the contract providing  office space for coalition partners supporting military operations in Iraq  was adequately managed to avoid excessive costs. MacDill used BPAs as a  flexible procurement method to obtain lodging at prices that were at or  below the maximum allowable GSA rate of $93 per day for Tampa. MacDill  also implemented installation guidance that required reservists at certain  ranks to share two-bedroom apartment units that further reduced costs on  a per-person basis. MacDill officials estimate that these procedures saved  about $12.6 million in off-base lodging costs in fiscal year 2003. Our review  showed that the prices paid by MacDill were similar to those paid by  corporate entities in Tampa for comparable lodging units, but were lower  on a per-person basis due to lodging sharing arrangements. This practice allowed MacDill to  achieve a cost savings of up to 55 percent of the GSA rate (table 1). Of a total of 800 reservists  housed in apartments, about 600 shared two-bedroom units. As  a result, the installation reported that it saved an estimated $12.6 million  for off-base lodging costs by using blanket purchase agreements and  requiring apartment sharing. Weaknesses in Contract Management Hamper Efforts to Assess Contract Costs

From project initiation to settlement of the contractor’s claim, the  management of Coalition Village II suffered from questionable acceptance  of the winning offer, poor record keeping, undocumented decisions  regarding changes to the contract, and changes to contract requirements  that were not properly coordinated with contracting officials. Although not all  the pages of Resun’s proposal were received by the deadline, the  contracting officer determined that because the first page had been  received in time, the entire proposal was timely. Resun’s initial offer for the contract was  $111,000, but a MacDill contracting official subsequently noted a  computation error, which increased the offer to $142,755. Conclusions

MacDill Air Force Base and other installations we identified that provide  lodging for reservists on extended temporary duty are often making efforts  to reduce off-base lodging costs by (1) obtaining prices that are below the  maximum allowable rate for lodging established by GSA and (2) requiring  military personnel below specified ranks to share apartments and/or hotel  rooms. We were not able to assess the  basis for additional costs paid to the contractor or the extent to which  costs might have been avoided or minimized because of these contract  management weaknesses.
Why GAO Did This Study

Since the September 11, 2001, attacks and the beginning of Operation Iraqi Freedom, thousands of National Guard and Reserve members have been activated and mobilized to military installations across the country. Some installations, like MacDill Air Force Base in Tampa, Florida, where more than 3,000 reservists have been mobilized, have had to arrange for off-base lodging in local hotels and apartment buildings. In addition, MacDill, which serves as U.S. Central Command headquarters, has had to set up temporary office space for staffs of coalition partner nations. Public concerns have been raised about these arrangements. GAO was asked to review (1) the extent to which MacDill used cost-effective measures to provide off-base lodging for reservists and (2) whether a contract providing office space for coalition partners was adequately managed to control costs.

What GAO Found

During recent mobilizations, MacDill contracting officials used two practices that effectively reduced the overall cost of off-base lodging for reservists on extended temporary duty to below that allowed by the General Services Administration's (GSA) lodging rate. Officials used a simplified acquisition procedure--Blanket Purchase Agreements (BPA)--to obtain prices that were at or below the maximum allowable GSA rate of $93 per day for Tampa, Florida. MacDill officials obtained daily lodging rates of $71 to $93 per unit for two-bedroom apartments. The BPAs also provided greater flexibility in vacating units without incurring penalties. In addition, MacDill officials reduced per person lodging costs further by implementing a roomsharing policy for personnel at certain ranks. When two reservists shared a two-bedroom unit (about 600 reservists), the cost dropped by up to 55 percent of the daily GSA rate. Overall, during fiscal year 2003, MacDill reported that it saved about $12.6 million using these practices. Our review of local rental costs showed that BPA prices were similar to those paid by corporate entities for comparable lodging units, but were lower on a perperson basis because of lodging sharing arrangements. From project initiation to settlement of the contractor's claim, the Coalition Village II contract suffered from questionable acceptance of the winning offer, poor record keeping, undocumented contracting decisions, and changes to contract requirements that were not properly coordinated with contracting officials. Although MacDill officials determined that the winning offer was received on time, only the first page of the proposal was received by the established deadline. Contract costs for the project, which was implemented under tight time constraints, increased by more than $367,000 over the winning offer of $142,755. However, due to the absence of proper documentation in the contract files, we were unable to fully assess the basis for additional costs paid to the contractor or the extent to which costs might have been avoided or minimized.