[CPEO-MEF] New BRAC proposed: "EFI"

[Lenny Siegel <lsiegel@cpeo.org>]

[The following comes to us courtesy the ICMA Military Discussion List:]

Today, Peter Aldridge, the Undersecretary of Defense for Acquisitions,
Technology and Logistics announced the Pentagon's next base
closure/realignment program, the Efficient Facilities Initiative or
"EFI" (BRAC by any other name....)

The Undersecretary stated that DOD retains 20-25% more infrastructure
capacity than needed, and that closing, consolidating and realigning
installations was the only way to address the financial burden this
excess produces. Under questioning, Mr. Aldridge stated that the 20-25%
range is a gross estimate determined at a macro level.

Under EFI, all installations would be reviewed. It also reauthorizes the
transfer of property at no-cost, and the transfer of property in
connection with the payment of environmental cleanup by explicitly
allowing payments to local redevelopment authorities and applying
section 330 indemnification to undisclosed contamination (early transfer authority).

A separate non-legislative process would be implemented for addressing
excess infrastructure capacity at overseas installations.

THE PROCESS:

EFI will be presented to Congress tomorrow. If it were to be passed by
Congress, the Secretary of Defense and services would begin reviewing
their force structure. The formation of an independent EFI commission
would follow to which the Secretary would give the recommendations from
their force structure reviews. The commission would then conduct its own
analyses and would give its final recommendations to the President for
all or nothing approval (see DOD EFI fact sheet below for cases in which
the Secretary of Defense's analysis does not match the commission's). If
approved by the President, the EFI list of affected installations could
then reach the Congress by Dec. 2003 (again for all or nothing
approval). If the President doesn't approve the list, then it goes back
to the commission which can take the concerns of the President into
consideration and resubmit a list to him. If the President rejects that
list, then the process is dead. Again, see details in DOD's EFI fact
sheet below.

The Undersecretary mentioned a few differences between EFI and previous
BRAC legislation:

1. There would be nine EFI commissioners instead of eight (no tie
votes). 
2. There  would be a Single round instead of multiple rounds. 
3. The highest criteria for closure would be an evaluation of "military
value". 
4. There will be many "factors"for consideration in the process: 
*       Combining operations 
*       Consolidation of activities 
*       Privatization in place 
*       Remobilization possibilities 
*       Elimination/reduction of leases 
*       Environmental cleanup costs versus Property value 
*       Partnerships with Communities

Despite mentioning it above, Mr. Aldridge had very few details about the
role of communities, either in the EFI process or afterward. He did
state that the single round was in part to provide a sense of relief to
those communities that are not listed by EFI, so that they will not have
to worry about a second round. However, he could not provide details
regarding how cities'/communities' input would be figured into the EFI
process (in previous BRAC rounds, communities spent large amounts of
money to make presentations to the commissions and to hire lobbyists and
consultants), and gave no further details on community partnerships.

Interestingly, looking at environmental cleanup costs as compared to the
projected property values is an idea that was seemingly not employed in
earlier rounds, leaving many former bases with extremely difficult
cleanup and redevelopment challenges. Also, DOD is looking to privatize
more cleanups (in order gain cleanup cost savings), and installations
with higher perceived property values are better candidates for this.

The term "military value" was not defined or further explained, however,
it is directly related to force structure determinations being made in
the Quadrennial Defense Review (QDR). The QDR must be completed by the
end of this September and would then be used in the force structure
analysis that would be done by the Secretary and services (if the
legislation is passed). However, one would hope that preliminary QDR
information must have been used by Pentagon officials in determining the
figure of 20-25% excess infrastructure capacity. 

In a question regarding the doubtful cost savings of closing bases, the
Undersecretary stated that EFI's main purpose would be to create the
proper infrastructure for the future force structure of the services,
not simply to save money. However, Mr. Aldridge continued on to say that
according to government numbers, DOD will see a cost savings of $6
million this year, and although closing bases costs 10's of billions of
dollars, in the long run they create substantial savings. He mentioned
that by FY07, DOD expected to be saving at a sustained rate of $7billion/year.

The Undersecretary could also not provide details at this time on how
the nine members of the commission would be selected, except to say that
it would be a consultative process with an expanded number of
Congressman and Senators, and the President.

Responding to one question regarding other competing legislation, and
the strong opposition by many in Congress, Mr. Aldridge stated that if
the measure is not approved, it could affect funding for other DOD
programs such as weapons systems, etc...

 Following is the DOD fact sheet on EFI:
-------------------------------------------------- 

 EFFICIENT FACILITIES INITIATIVE OF 2001 Fact Sheet

What Is It?

*       Building on the Defense Base Closure and Realignment Act of
1990, the Efficient Facilities Initiative of 2001 (EFI) authorizes the
Secretary of Defense to recommend a single round of base closures and
realignments to an independent commission in 2003. 

*        *       The purpose of the EFI is twofold: 

                1)      To comprehensively evaluate the continuing need
for domestic DoD installations based on the continuing availability of
DoD installations worldwide, and the results of an overseas basing
review to be conducted upon completion of the QDR; and

                2)      To consider how best to organize important
military assets to meet future national security needs.

*       The EFI has three major components:  

                1)      It authorizes an additional round of base
closures and realignments under existing base closure laws; 

                2)      It improves the existing base closure process in
new and innovative ways that harness the strength and creativity of the
private sector and ensures the primacy of military value;  and 
                3)      It authorizes creative new ways in which the
Service Secretaries and local communities can become partners in the
ownership, operation, or maintenance of enduring military installations.

*       In essence, the EFI permanently authorizes the pilot program
tested at Brooks Air Force Base in San Antonio, Texas and makes it
available to all the military departments.

Why Is It Needed?

*       There are three primary reasons why an additional round of
closures and realignments is necessary today:

                1)      The Post-Cold War reduction in forces was not
paralleled by similar reductions in facilities.  Consequently, current
facilities do not match force structure. 

                2)      Military installations must be restructured to
meet the missions and challenges of the new century; and

                3)      Excess or single-use facilities waste limited
resources, that could be better spent on more urgent priorities, on
maintaining infrastructure we no longer need.                 

 Matching Facilities to Forces

*       Current estimates show there is between 20 and 25 percent more
base capacity than actually needed. 

*        *       The EFI will help find innovative ways to consolidate,
realign, or find alternative uses for current facilities. 

*       All recommendations will be based on current and future force
structure requirements and emphasize military value.

*       All military installations will be reviewed.

Meeting the Challenges of a New Century.  

*       To transform the force for the future, operational needs must
drive base function and location. 

*        *       Facilities must be restructured to serve the missions
of more than one Service.  

*        *       Enhancing Joint Service operations not only reduces
waste, it maximizes military effectiveness. 

*        *       The EFI will facilitate multi-Service missions, and
create joint organizational and basing solutions.

Making the Wisest Use of Limited Defense Dollars  

*       Both the President and the Secretary of Defense are committed to
developing the military capabilities needed for the 21st century. 

*        *       They are also committed to ensuring optimal use of
every Defense dollar. 

*        *       The savings produced by EFI will allow the Department
to:  
*       focus more resources on facilities we actually need; 
*       help reduce the current rate of facilities replacement from 192
to 98  (i.e. 192 to 98) years;  
*       free-up needed resources for recruitment, training, and
modernization; and 
*       ultimately save the taxpayers up to $3.5 billion annually.

*       Independent analyses by both the General Accounting Office (GAO)
and the Congressional Budget Office (CBO) have consistently supported
the Department's view that the BRAC process provides significant
savings.   The GAO's 1998 reports affirms that once implementations
costs have been offset, "BRAC recommendations will result in substantial
savings."  The Congressional Budget Office concurred saying the GAO
report was "consistent with CBO's own conclusions:  past and future BRAC
rounds will lead to significant savings."  

        A forthcoming GAO report is expected to characterize BRAC
savings through 2001, as well as annual recurring savings, as
substantial and reasonable.  

*       Savings from base realignments and closures are retained by the
military Services and used to support higher priority programs that
enhance modernization, readiness, and quality of life for our armed
forces. 

Details

The Commission and the Closure Process

*       The Secretary will conduct  a comprehensive review of DoD
installations, based on a force structure plan and a selection criteria
that emphasize military value, and make recommendations to an
independent Efficient Facilities Initiative Commission by March 14,
2003.    

*        *       The Commission will review the Secretary's
recommendations and send their own to the President by July 7, 2003.   

*        *       The Commission can change the Secretary's
recommendations only if the Secretary deviated substantially from the
force structure plan and selection criteria.   

*        *       The Commission must give the Secretary the chance to
testify about the proposed change.   

*        *       The Secretary can block any additional closure or
realignment, or the expansion of any realignment, by written notice to
the Commission.

*       The President will then have two weeks (until July 22, 2003) to
accept or reject the Commission's recommendations on an "all or none"
basis. If rejected, the Commission shall provide revised recommendations
to the President by Aug 18, 2003.   

*        *       If the recommendations are rejected by the President a
second time, the process ends.   If  the recommendations are accepted,
the President has until September 3, 2003 to transmit his
recommendations to Congress.   

*         *       Forty-five days after the president transmits his
recommendations (or the adjournment sine die of Congress, whichever
occurs first), the President's recommendations become binding on the
Secretary unless the Congress enacts a Joint Resolution rejecting the
recommendations on an "all or none" basis. 

*       Recommendations sent to the Secretary must be initiated within
two years and completed within six years.

Differences from Previous Closures and Realignments

*       Under the previous legislation, consultation between the
President and the Congress was limited to the top leaders of the House
and Senate. Those leaders were, in turn, were confined to discuss only
one or two nominees each. (The Senate Majority Leader and Speaker of the
House each consulted on two nominees; the Senate Minority Leader and the
House Minority Leader each consulted on one nominee.)

        Under the new legislation, the number of Congressional leaders
consulted is expanded to include the chairmen and ranking members of the
defense committees of both the House and the Senate, and all may consult
with the President about all nominees, rather than just one or two.

*       It sets the number of commissioners at nine, rather than eight,
so there will be no tie votes to delay or obstruct the process. 

*        *       The legislation provides for a single round, rather
than multiple rounds of closures and realignments.

*       It demands that the force structure plan and the selection
criteria emphasize military value.  The previous legislation provided no
specific guidance as to force structure and selection criteria.   *     
 The legislation highlights the kind of factors the Secretary should
consider in his evaluation, for example: 
*       Efficiencies gained from combining military operations on a
single installation; 
*       Savings from consolidation of activities;  
*       Savings and efficiencies from the privatization in place of
Defense activities; 
*       Savings from collocating federal, military department or defense
agency activities; 
*       Savings from the elimination or reduction of leased space; 
*       Whether the cost of environmental cleanup substantially exceeds
the value of the property; 
*       Potential remobilization or the potential need for additional
test and training ranges and the means to accommodate such potential by: 
*       Retaining all or a portion of an installation not currently
needed for defense purposes; 
*       Leasing such property to other users, provided the lease can be
cancelled if necessary; and 
*       Entering into partnerships with local communities.   
*       The legislation allows privatization in place only if that
method of closure or realignment is specifically authorized in the
Secretary's or Commission's recommendations, and is the most cost
effective method of implementation.

*       It requires the Commission to give the Secretary or his designee
the opportunity to testify on all proposed changes to his
recommendations, and authorizes the Secretary to block any such change
that adds a closure or realignment or expands the scope of a realignment.

Benefits to Local Communities

*       The legislation gives localities a significant role in
determining the future use of military installations in their communities.

*       It expedites the clean up of property and authorizes its
transfer to the local redevelopment authority at no cost, provided the
property is used to generate jobs and the proceeds are reinvested in the
economic redevelopment of the installation or the surrounding community.

*        The legislation re-authorizes the transfer of property in
connection with the payment of environmental cleanup by explicitly
allowing payments to local redevelopment authorities and applying
section 330 indemnification to undisclosed contamination. 

-- 


Lenny Siegel
Director, Center for Public Environmental Oversight
c/o PSC, 222B View St., Mountain View, CA 94041
Voice: 650/961-8918 or 650/969-1545
Fax: 650/961-8918
lsiegel@cpeo.org
http://www.cpeo.org

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