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. 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. 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. 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. 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. 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. Specific time frames for developing the installations services models have  not been established. 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. 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. 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. 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. (The Department of Defense (DOD) is  currently seeking to restructure these accounts with improved tracking  mechanisms.) 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 pre- reorganization data. 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. Similar problems are reportedly  occurring in fiscal year 2005. As we have  previously reported, such problems adversely affect efforts to maintain  facilities and provide base support services.
Why GAO Did This Study

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.

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.