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Chapter 16

INFRASTRUCTURE

Support operations play a critical role in enabling Department of Defense personnel to live, train, and execute national security policy. Support functions must become better, faster, and less expensive to contribute to quality of life, morale, retention, and force readiness.

FACILITY MANAGEMENT

DoD Infrastructure

The Department has the world’s largest dedicated infrastructure. Roughly the size of the state of Virginia (40,000 square miles), the Department’s physical plant is worth $500 billion. It includes mission and mission–support facilities and housing for more than 293,000 families and about 400,000 unmarried service members. The Department is actively pursuing initiatives to improve efficiency and performance of the DoD facility support structure.

Facility Strategic Plan

The Department is developing a strategic plan to serve as a source for planning guidance on facilities. An initial plan, which includes a vision, mission, and goals, incorporates many existing initiatives, such as improvement of lease management, demolition of excess and obsolete structures, and development of a facility aging model. An extended plan will incorporate new initiatives such as joint use, recapitalization, and improved real property reporting. The first annual plan will be issued in early 1999.

Enhanced Out–Leasing of Underutilized DoD Real Property

Congress asked DoD to report on uses of non–excess military property for which DoD has long–term leases but no immediate utilization requirements. Since Congress has not authorized the closing of additional bases, use of such property could present a potential economic benefit to the Department and the nation. As a result, DoD is examining and will report on options for improving real property asset management at DoD installations in early 1999.

Improved Management of Leasing

The Department of Defense spent approximately $823 million in FY 1998 to lease buildings and property for its use. In managing this process, each Service and defense agency developed its own plans and procedures, with no systematic process to achieve efficiencies through cross–Service/agency coordination. Making these efforts more difficult is the fact that data on leasing is inadequate, inconsistent, and not integrated into long–term force and infrastructure planning. Improving the management of leased property in the Department involves improving the quality and consistency of data, determining the appropriate organizational level and scope for management of leased property, and competing leased property management.

To improve the quality and consistency of data and to achieve better use of leased assets, the Department is creating a DoD–wide integrated relational database/information system that provides real–time information on leased–space costs, availability, and terms and conditions. Improving the management of DoD real property assets will lead to better use of owned land and buildings resulting in reduced leasing costs.

Facility Disposal

One element of the facilities strategic plan concerns the demolition and disposal of approximately 80 million square feet of obsolete and excess buildings by FY 2003. This initiative, part of the Secretary’s Defense Reform Initiative (DRI), remains on track toward meeting the target. Disposal of these buildings will save operations and maintenance dollars, as well as improve safety through the removal of abandoned facilities.

Research, Development, Test, and Evaluation

The increasing complexity of DoD weapon systems and the expanding size of the forecasted battlespace are driving the research, development, test, and evaluation (RDT&E) infrastructure to become more complex and more sophisticated. DoD laboratories now develop leading–edge technologies across a broader spectrum of the physical and life sciences that are directly relevant to warfighter needs and have substantial commercial applications. Similarly, test and evaluation infrastructure supports users ranging from laboratories through operational units, federal agencies, U.S. allies, and commercial enterprises. It provides test and evaluation services for complex, high performance systems in test environments that replicate expected operations environment. Several thousand test projects are performed at these sites each year for DoD, other federal agencies, U.S. allies, and commercial users.

Base Realignment and Closure (BRAC) and other actions have resulted in improved responsiveness and yielded significant reductions in RDT&E personnel and infrastructure. DoD recognizes that it must continue to improve infrastructure efficiency to provide technologically superior test capabilities for U.S. forces. Under Section 912 of the FY 1998 National Defense Authorization Act, DoD is reviewing laboratory and test and evaluation infrastructure.

In addition to the review of the infrastructure, DoD is also studying several areas for test and evaluation process improvement to reduce cycle time for, and the costs of, the development of systems and to accelerate the use of commercial products.

Military Housing

Quality of life, and housing in particular, remains a priority for the Department. Worldwide, the Department owns over 297,000 housing units and leases another 27,000 units. The Services identified over 181,000 of the owned units (62 percent) as inadequate. The FY 1999 President’s Budget request of $3.5 billion for family housing will revitalize over 5,600 housing units ($611 million) and provide $2.8 billion to operate and manage housing for service members and their families. The Services also provide unaccompanied housing for over 390,000 single soldiers, sailors, airmen, and Marines worldwide. Like family housing, current estimates show almost two–thirds of the barracks spaces are considered inadequate, requiring significant revitalization or replacement.

To combat the problem of poor housing, the Department established clear goals for the Services to eliminate inadequate family housing by 2010 and to eliminate permanent party gang latrines by 2008. The Services have provided installation–specific plans to accomplish the family housing goal and are preparing similar plans for implementing the Department’s 1+1 barracks standard.

MILITARY HOUSING PRIVATIZATION

One of the Secretary of Defense’s top priorities is to improve the quality of life for service members and their families by providing quality affordable military family housing. Two–thirds of DoD’s 297,000 existing housing units are in need of extensive repair. Using traditional military construction practices and funding, it would take 30 years and $20 billion to solve the housing problem. The Department’s Military Housing Privatization Initiative, signed into law in 1996, is now an essential tool for solving its housing problem. This initiative enables the Department to decrease its up–front construction expenses and eliminate the operations, maintenance, and management costs that are incurred over the life of traditional housing construction projects. Since 1996, DoD has made significant progress toward the privatization of military housing and plans to accelerate the privatization program in the future. DoD now has solid examples to follow that will help build a portfolio of successes.

Two Navy projects totaling 589 town house units, at Naval Air Station Corpus Christi, Texas, and at Naval Station Everett, Washington, were completed in 1997. Service members and their families are now living in their new homes. In 1998, the Air Force awarded a project at Lackland Air Force Base, Texas. The company that was awarded this project will design, construct, own, operate, and manage 420 new units of rental housing to serve enlisted families at the base. DoD is evaluating proposals for an up to 160 housing unit project at Marine Corps Logistics Base, Albany, Georgia. The Department projects that the Services will issue more than 30 additional requests for proposals and requests for qualifications by the end of 1999. The Services will continue to nominate more sites each year.

In 1996, OSD established the Housing Revitalization Office to help establish this privatization program. With a solid foundation in place in 1998, OSD returned to its traditional program oversight role while maintaining control of the Family Housing Improvement Fund. Program implementation from project development to execution is the responsibility of the Services. This effort responds to DRI Goal 6B - To privatize 30,000 military housing units by FY 2000.

Energy Conservation

The Department spent $2.17 billion in FY 1997 to heat, light, cool, and operate buildings and other facilities on military installations. DoD consumes over 70 percent of all energy used by all federal facilities. The long–term goal established by Executive Order 12902 is to reduce energy use by 30 percent by FY 2005. FY 1997 energy consumption in Department of Defense buildings and facilities was 17.2 percent below the FY 1985 baseline.

The Services and defense agencies continued to achieve significant energy reductions through proactive energy awareness and training programs, energy audits and surveys, and investments in energy conservation measures. Energy and water conservation measures were funded from many sources, including Operation and Maintenance funds, the DoD Federal Energy Management Program, and the Energy Conservation Investment Program. The DoD energy program also benefited from alternative funding programs such as Energy Savings Performance Contracting and utility sponsored demand and energy conservation incentive programs. Effective and efficient use of energy decreases operating costs, reduces greenhouse gases, and mitigates global warming.

Under the White House Climate Change Task Force, DoD has chartered a working group on Sustainable Design to develop implementation plans throughout all federal agencies. Sustainable Design integrates the following principles into facility and infrastructure planning, programming, design, construction, and facilities management:

· Increased energy conservation and efficiency.

· Increased use of renewable energy resources.

· Reduction or elimination of toxic and harmful substances in facilities and their surrounding environments.

· Improvements to interior and exterior environments leading to increased productivity and better health.

· Efficiency in resource and materials utilization, especially water resources.

· Selection of materials and products based on their life–cycle environmental impacts.

· Increased use of materials and products with recycled content.

· Recycling of construction waste and building materials after demolition.

· Reduction in harmful waste products produced during construction.

· Facility maintenance and operational practices that reduce or eliminate harmful effects on people and the natural environment.

DoD is implementing Sustainable Design in all new buildings and facilities planned for construction after FY 2000. It expects to achieve a 30 to 50 percent increase in energy efficiency, compared to conventional buildings and facilities of similar function constructed in FY 1996. The future construction program is still being developed; at this point, rough estimates are that DoD will build approximately 16 million square feet of new facilities in the next decade. Applying sustainable design to 16 million square feet of facilities will save over 500 billion BTUs and over $5 million in energy savings a year.

The Department is also actively participating in working groups addressing Energy Savings Performance Contracting, compact fluorescent lights, expanded use of renewable technologies, energy efficient windows, review of executive orders and procurement tools, energy use in the transportation sector, and expanded use of combined heat and power technologies. Emphasis on greater use of these applications and technologies will dramatically reduce energy consumption.

Streamlining Through Competition

COMPETITIVE SOURCING

The Defense Reform Initiative called for the Department to increasingly rely on the competitive powers of the marketplace to generate efficiency. The dynamics of competition improve quality, reduce costs, and focus on customers’ needs. DoD is committed to using competitive sourcing as a tool to obtain efficiencies and generate savings for the modernization of U.S. forces.

Historically, the Department saved 20 percent on services costs as a result of past competitions, with some recently completed competitions yielding more than 40 percent savings. The Services and major defense agencies plan to compete more than 229,000 positions between FY 1997 and FY 2005. In order to assure sufficient candidates are available for competition, an inventory and review of all civilian and military positions within the Department were completed in January 1999. The inventory and review determined which positions within DoD are inherently governmental in nature, which are commercial activities exempt from competition, and which are commercial activities available for competition. The Department will continue to use competitive sourcing and other tools to obtain efficiencies and savings while preparing to meet the challenges of the next millennium.

UTILITIES PRIVATIZATION

The Department continues to aggressively pursue the privatization of its electric, water, waste water, and natural gas utility systems in accordance with the Defense Reform Initiative. This will reduce infrastructure costs while providing quality utility service. Industry has shown a strong interest in DoD’s privatization efforts. Competition for both the conveyance of the utility infrastructure and the resulting acquisition of utility service is key to the effective management of the substantial resources DoD directs at its energy facilities. The Department issued uniform criteria for economic and security exemptions guidance from the utility privatization policy.

RIGHT-SIZING THE BASE STRUCTURE

The Department’s BRAC process is a major tool for reducing the domestic base structure and generating savings. DoD recognizes its responsibility to communities surrounding former bases and has a strong track record in helping them develop these properties into vibrant centers of economic growth for public benefit. Even so, the Department’s base infrastructure remains too large for its mission. It must be right–sized to properly support the national security mission.

BRAC Savings

With four BRAC rounds between 1988 and 1995, DoD invested approximately $22.5 billion to close or realign 152 major installations and 235 smaller installations. These closures and realignments will net a projected $14.5 billion savings by FY 2001. Recurring savings after FY 2001 will amount to approximately $5.7 billion each year. These costs and savings were confirmed in a DoD report submitted to Congress in accordance with Section 2824 of the 1998 National Defense Authorization Act. The Congressional Budget Office verified that DoD estimates contained in the report are reasonable and credible.

Base Reuse Improvements

The Department continues to make base reuse a high priority. Since 1993, when President Clinton launched a plan to support faster redevelopment at base closure communities, DoD has made major improvements to the way former military bases are converted to civilian use.

· Jobs Centered Property Disposal. When a military installation closes, Economic Development Conveyances (EDC), in an effort to generate jobs, make BRAC property available to public entities at, or below, the estimated fair market value. Primarily, the EDC program addresses the economic problems a community faces when a military installation closes. Reuse of the property is often the only available development opportunity. Job generation, private investment, and economic growth can take place on the former property if it is accessible quickly and at a reasonable cost. Economic recovery is accelerated by tailoring the EDC financial payment terms and conditions to fit communities’ plans to reuse the former bases. EDCs also enhance DoD’s ability to dispose of unneeded facilities and eliminate protection and maintenance costs while obtaining fair and reasonable compensation for former assets. Thirty–two approved EDCs anticipate the creation of 146,073 jobs and are expected to yield more than $300 million. DoD routinely assesses this program for appropriate balance, flexibility, and responsiveness.

· Leasing for Reuse. Easy and quick access to former DoD facilities through the issuance of interim leases for job–generating and revenue–generating tenants is essential for a BRAC community to succeed. The Department has taken many steps to streamline and accelerate the review and approval of interim lease applications. Some examples are that model leases are in place that serve as boilerplate for the standard federal lease requirements; preleasing conferences are convened by the military departments with the BRAC community and prospective tenant to review regulatory requirements and timelines for processing a lease; and the military departments delegate, to the extent practicable, lease approval authority to their field divisions. Due to these efforts, tenant activity at closed bases increased an average of 56 percent since June 1995.

· Better Guidance. DoD’s Base Reuse Implementation Manual, first published in 1995 and reissued in 1997, helps BRAC communities better understand the steps involved in gaining access to former military property quickly and easily. It also establishes DoD’s policies and procedures for the base closure, disposal, and reuse processes. The manual is an excellent resource document. Follow–up editions will incorporate future legislative changes, process improvements, and policy modifications, and will hold to the Department’s commitment of a flexible process that works better and costs less.

New Jobs and New Tenants

Successful recovery from base closures through conversion of military bases is found throughout the country. Already the redevelopment of closed bases created 47,682 new jobs and 1,100 tenants. For bases closed more than two years, 70 percent of the lost civilian jobs have been replaced. In many locations, job generation and economic activity at closed bases serve other public purposes, such as airports, ports, schools, hospitals, parks, prisons, government offices, facilities for the homeless, and affordable housing. Such activities reduce government costs and provide stability for development. Their presence, especially early in the reuse process, helps attract other tenants and jobs.

Most communities are rebounding remarkably fast, crafting more diverse and stronger economies. BRAC communities in California, the state hardest hit by base closures, are well on their way to recovery. For example, on the site of the former army depot in Sacramento, Packard Bell employs 5,000 people. At the former Mather Air Force Base in Sacramento, there are 800 more jobs than the number of civilian positions on the base before it closed. The former Castle Air Force Base, located in a low–income, high unemployment, agricultural area of northern California, now boasts almost 1,900 new jobs, completely replacing the 1,149 civilian positions that were lost because of the closure. At Norton Air Force Base in San Bernadino, the airport and other businesses have attracted 80 tenants with 2,490 employees, and all 1.25 million square feet of available property is leased. Demolition and site preparation for the construction of one million square feet of new warehouse space are under way.

These are just a few illustrations of the growth of public and private sector operations at closed bases. BRAC communities are experiencing unprecedented success in reusing redundant defense assets for civilian, job–generating purposes. This success is expected to continue.

Surplus Property Disposal

To speed the economic recovery of BRAC communities, it is DoD policy to dispose of property as quickly as possible. Once BRAC property is declared surplus, various disposal mechanisms are available to a state or community. Reuse preferences and acquisition strategies are identified in a community–based public planning process, incorporated into a reuse plan, and submitted to the landholder disposal agent for consideration.

DoD uses 101 major base closure properties, approximately 284,000 acres of excess BRAC property, as a baseline for measuring progress on disposal. As part of the Department’s involvement in the National Partnership for Reinventing Government, DoD established a goal to complete disposal of 50 percent of the property baseline, or 142,000 acres, by 2000. Seventy–two base transition coordinators are on site to help facilitate the disposal process. Already, DoD has transferred or sold approximately 72,000 acres. This was done in close cooperation with BRAC communities and in keeping with their reuse plans. This effort responds to the DRI’s Goal 6a - In the spirit of fostering partnerships and community solutions, DoD will complete disposal of 50 percent of the surplus property baseline.

Future Base Closure Rounds

The Quadrennial Defense Review established three key elements of defense strategy. The U.S. military must shape the international security environment day to day, respond to crises across the full spectrum of operations, and prepare now to meet future threats. The Defense Reform Initiative set out the agenda for that revolution, including reengineering business processes, consolidating organizations, competing commercial activities, and eliminating excess infrastructure. Central to this effort are two additional rounds of BRAC beginning in 2001. The Department needs two more BRAC rounds if tomorrow’s forces are to carry out their mission. Department efforts to operate and maintain unneeded facilities waste resources that are better spent on modernization and readiness. As a result of the first four rounds of BRAC (1988, 1991, 1993, and 1995), the Department will save $14.5 billion by FY 2001, with savings of about $5.7 billion every year thereafter. Important decisions about future BRAC rounds need to be made in the near future since the Department’s growing modernization program peaks in the period after 2005 and additional resources must be found to support it. Eliminating excess capacity in infrastructure early in the next decade could yield billions in savings necessary to finance modernization and readiness programs, and facilitate realization of the goals contained in Joint Vision 2010.

REDUCING TOXIC CHEMICALS RELEASES AT INSTALLATIONS

In 1994, DoD began to submit annual reports to the Environmental Protection Agency on the release of toxic chemicals. In 1995, DoD released or transferred off–site 6.8 million pounds of these chemicals. In 1996, DoD reduced these releases and shipments by 28 percent to 4.9 million pounds by adopting a strong pollution prevention program and by reducing polluting activities. Thus, DoD achieved and exceeded this goal four years early. To demonstrate further commitment to reducing toxic chemical releases, DoD intends to reduce release and off–site transfer of toxic chemicals by another 20 percent from the 1995 baseline.

DoD reached and exceeded its original 20 percent reduction goal by finding new products and processes that do not rely on toxic chemicals, working in partnership with industry to reduce or eliminate toxic chemicals used in manufacturing weapons, and minimizing the use of toxic chemicals in manufacturing weapons. This reduces the use of toxic chemicals on military bases that operate, maintain, and repair weapons.

By decreasing use of these toxic chemicals, the Department avoids spending money on extra paperwork, special handling, and disposal. Most importantly, the environment is improved for everyone. This effort responds to the DRI’s Goal 8 - Reducing total release of toxic chemicals by a further 20 percent from a 1995 baseline by 2000.

Integrated Environmental Management

Corporate experience shows that the integration of environmental and core concerns within an organization can generate constructive, cost–effective environmental management which reduces the use of resources. DoD initiated an integrated approach to environmental security decision making and management. The objective of this program is to protect people, manage training and living areas judiciously, be a good citizen and neighbor, and set an example for other militaries around the world.

One of DoD’s most significant recent innovations in integrated environmental management is establishing ecosystem management as the preferred approach to managing its natural and cultural resources. Ecosystem management involves partnering with other land managers, involving stakeholders in resource decision making, using the best scientific information available, considering many environmental factors, and preserving long–term ecological functions.

DoD is employing an ecosystem approach to natural and cultural resources management on a large scale in California’s Mojave Desert, where Army, Navy, Marine Corps, and Air Force bases are all located. This approach helps DoD land managers and trainers better assess the quality of their lands, determine future uses, assess impacts beyond installation borders, and conserve areas that are rare and unique and need protection.

This ecoregional approach is also proving increasingly attractive to major military installations, such as Eglin AFB, Florida, where new cooperative agreements with adjacent state and federal land owners helped ease the specific compliance burdens associated with the requirements of the Endangered Species Act for the endangered red–cockaded woodpecker. Other bases implementing this approach include Camp Pendleton, California; Fort Hood, Texas; Fort Huachuca, Arizona; and Arnold AFB, Texas.

DoD continues to test new management approaches such as the International Standards Organization’s (ISO) 14001 standard. ISO 14001 is an international standard on environmental management systems designed to help companies improve the effectiveness of their environmental programs, especially in addressing emerging requirements. DoD began a pilot program to test the feasibility and cost effectiveness of ISO 14001 at 18 military installations. The pilot program is designed to gain experience at a wide variety of installations and includes partnerships with state environmental regulators.

Environmental Liability From Past Practices

The Department is moving toward its objective of completing the cleanup program and eliminating a continuing drain on the Department’s resources. At the cleanup program’s inception, progress was measured by the number of sites identified, remedies selected, cleanups prioritized, and cleanup designs approved. As the program matured, the focus of the cleanup program has moved from identifying sites to completing cleanups. Today, progress is measured by the number of sites with remedies in place and the number of sites categorized as response complete, indicating sites reaching the last milestone in the cleanup process. To ensure resources and efforts produce optimal value, new technologies are incorporated into planned cleanups; risk analyses are used to select risk–based remedies that are consistent with anticipated land use; peer reviews are used to improve program efficiency; and planning, programming, and budgeting has been devolved to the Services.

CONCLUSION

The Department of Defense is working hard to make its support structure as agile and efficient as possible. DoD is improving every area of its infrastructure so that as the nation enters the next millennium the Department will be prepared to face global challenges. DoD is committed to maintaining only the infrastructure needed and to managing it better—adopting the best business practices, streamlining organizations, and introducing competition into the delivery of support services, wherever it is effective to do so.

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