As a result, the Congress enacted section 2824 of the National Defense Authorization Act for Fiscal Year 1998, which required that the Secretary of Defense provide the Congress with a comprehensive report on a range of BRAC issues and described the manner in which the data were to be presented in the report. Accordingly, the Secretary requested two additional BRAC rounds in 2001 and 2005. The Secretary also noted DOD’s assistance in facilitating economic growth and development for communities affected by BRAC actions. DOD looked to a number of indicators and studies to determine whether any operational and readiness problems could be linked to BRAC actions. For example, while DOD’s analysis shows no increase in the excess capacity between 1989 and 2003 in the category of Army depots, our previous work has shown—and DOD officials have agreed—that depots have excess capacity. Our prior and ongoing work also found indications of economic recovery in many communities, although some are faring better than others. DOD’s report indicates that future BRAC procedures and methodologies would be similar to those used in prior rounds. Further, DOD’s conclusion that military capability has not suffered adverse long-term effects because of BRAC actions appears to be reasonable. In addition, DOD agreed that the process used to conduct prior BRAC rounds is a good starting point for considering future BRAC legislation. Copies will also be made available to others upon request. Assessment of Limitations in DOD’s Response to Legislative Requirements

DOD’s report provides most, but not all, of the information required by section 2824. In selected instances, certain information is either not provided or not provided in the level of specificity required. Costs and Savings of Prior BRAC Rounds

DOD responded to the requirement to provide costs and savings data in four different categories: (1) costs and savings of bases already closed or realigned during the previous four BRAC rounds, (2) costs and savings during the implementation periods for each of the four previous BRAC rounds, (3) net savings on an annual recurring basis after the BRAC implementation period, and (4) estimated costs and savings from two future BRAC rounds. DOD’s report indicates that net savings will be $3.7 billion in fiscal year 1999. DOD’s Estimates of Prior Costs and Savings Data

For its report, DOD assessed its costs and savings data from several vantage points to affirm its position that prior BRAC rounds are saving billions of dollars in operating costs. However, DOD’s conclusions did not reflect the following key factors. Our observations below indicate that DOD’s analysis provides only a rough indication of excess capacity that continues to exist. GAO Comments

1. 2. 5. 6. 8. Objectives, Scope, and Methodology

To provide our analysis of DOD’s report on base realignment and closure, we made an overall assessment of DOD’s responsiveness to the individual section 2824 reporting requirements and assessed individual reporting topics, including the costs and savings from prior BRAC rounds and estimated costs and savings from future BRAC rounds, the impact of prior BRAC rounds on military capabilities, excess capacity, base reuse and economic recovery of communities affected by BRAC actions, and processes DOD would use to select bases for closure or realignment should further BRAC rounds be authorized.
Why GAO Did This Study

Pursuant to a legislative requirement, GAO reviewed the Department of Defense's (DOD) report on the costs and savings attributable to the rounds of base realignments and closures (BRAC), focusing on: (1) the costs and savings of prior BRAC rounds and estimated costs and savings of future BRAC rounds; (2) the impact of prior BRAC rounds on military capabilities, excess capacity, base reuse and economic recovery of communities affected by BRAC actions; and (3) processes DOD would use to select bases for closure and realignments should further BRAC rounds be authorized.

What GAO Found

GAO noted that: (1) DOD's report to Congress provided most, but not all, of the information required in section 2824 of the National Defense Authorization Act for Fiscal Year 1998; (2) in selected instances, usually because data were not available, DOD either did not provide the information required or did not provide it in the level of specificity required; (3) DOD's report concludes that the four prior BRAC rounds, taken in aggregate, are saving DOD billions of dollars annually; (4) GAO's prior work examining BRAC cost and savings and related issues affirms that past BRAC recommendations will result in substantial savings once implementation costs have been offset and net savings begin to accrue; (5) however, because of data and records weaknesses, DOD's report should be viewed as providing a rough approximation of costs and savings rather than a precise accounting; (6) DOD's data systems do not capture all savings associated with BRAC actions, nor has DOD established a separate system to track BRAC savings; (7) DOD's estimates of costs and savings for future BRAC rounds should also be viewed as rough estimates because there is no assurance that the cost and savings experiences from prior BRAC rounds will be precisely replicated in the future; (8) because the methodology used to identify excess capacity has a number of limitations, DOD's report gives only a rough indication that excess capacity has increased relative to force structure since 1989; (9) however, other DOD studies, statements by DOD officials, and GAO's prior work support the report's general conclusion that DOD continues to retain excess capacity; (10) GAO's work has shown this to be the case, particularly in maintenance depots and in research, development, test, and evaluation facilities; (11) DOD's analysis of operational and readiness indicators have shown no long-term problems affecting military capabilities that can be related to BRAC actions; (12) this general conclusion is also consistent with GAO's prior work; (13) DOD's report emphasizes that communities affected by prior BRAC actions appear to be rebounding economically; (14) GAO also found this to be the case, although its work also shows that some communities are faring better than others; (15) DOD's report suggests that proposed BRAC rounds in 2001 and 2005 would be conducted like prior rounds; and (16) DOD's legislative proposal requesting authority to conduct two additional BRAC rounds provides a good starting point for considering future legislation, should Congress decide to authorize additional rounds.