MILITARY CONSTRUCTION

APPROPRIATIONS FOR 1974

HEARINGS

BEFORE A

SUBCOMMITTEE OF THE

COMMITTEE ON APPROPRIATIONS

HOUSE OF REPRESENTATIVES

NINETY-THIRD CONGRESS

FIRST SESSION

SUBCOMMITTEE ON MILITARY CONSTRUCTION APPROPRIATIONS

ROBERT L. F. SIKES, Florida, Chairman

EDWARD J. PATTEN, New Jersey GLENN R. DAVIS, Wisconsin

CLARENCE D. LONG, Maryland BURT L. TALCOTT, California

DAVID R. OBEY, Wisconsin ROBERT C. McEWEN, New York

K. GUNN McKAY, Utah

ROBERT C. NICHOLAS III, Staff Assistant

PART 1

DEPARTMENT OF THE ARMY

OFFICE OF THE SECRETARY OF DEFENSE

Printed for the use of the Committee on Appropriations

U.S. GOVERNMENT PRINTING OFFICE

20-192 O WASHINGTON : 1973

COMMITTEE ON APPROPRIATION

GEORGE H. MAHON, Texas, Chairman

JAMIE L. WHITTEN, Mississippi

JOHN J. ROONEY, New York

ROBERT L. F. SIKES, Florida

OTTO E. PASSMAN, Louisiana

JOE L. EVINS, Tennessee

EDWARD P. BOLAND, Massachusetts

WILLIAM H. NATCHER, Kentucky

DANIEL J. FLOOD, Pennsylvania

TOM STEED, Oklahoma

GEORGE E. SHIPLEY, Illinois

JOHN M. SLACK, West Virginia

JOHN J. FLYNT, JR., Georgia

NEAL SMITH, Iowa

ROBERT N. GIAIMO, Connecticut

JULIA BUTLER HANSEN, Washington

JOSEPH P. ADDABBO, New York

JOHN J. McFALL, California

EDWARD J. PATTEN, New Jersey

CLARENCE D. LONG, Maryland

SIDNEY R. YATES, Illinois

BOB CASEY, Texas

FRANK E. EVANS, Colorado

DAVID R. OBEY, Wisconsin

EDWARD R. ROYBAL, California

LOUIS STOKES, Ohio

J. EDWARD ROUSH, Indiana

GUNN McKAY, Utah

TOM BEVILL, Alabama

EDITH GREEN, Oregon

ROBERT O. TIERNAN, Rhode Island

BILL CHAPPELL, Ja., Florida

BILL D. BURLISON, Missouri

ELFORD A. CEDERBERG, Michigan

JOHN J. RHODES, Arizona

WILLIAM E. MINSHALL, Ohio

ROBERT H. MICHEL, Illinois

SILVIO O. CONTE, Massachusetts

GLENN R. DAVIS, Wisconsin

HOWARD W. ROBISON, New York

GARNER E. SHRIVER, Kansas

JOSEPH M. McDADE, Pennsylvania

MARK ANDREWS, North Dakota

LOUIS C. WYMAN, New Hampshire

BURT L. TALCOTT, California

WENDELL WYATT, Oregon

JACK EDWARDS, Alabama

WILLIAM J. SCHERLE, Iowa

ROBERT C. McEWEN, New York

JOHN T. MYERS, Indiana

J. KENNETH ROBINSON, Virginia

CLARENCE E. MILLER, Ohio

EARL B. RUTH, North Carolina

VICTOR V. VEYSEY, California

LAWRENCE COUGHLIN, Pennsylvania

KEITH F. MAINLAND, Clerk and Staf Director

STAFF AsSISTANTs

GEORGE E. EVANS

ROBERT B. FOSTER

JOHN M. GARRITY

AUBREY A. GUNNELS

CHARLES G. HARDIN

JAY B. HOWE

F. MICHAEL HUGO

THOMAS J. KINGFIELD

ROBERT L. KNISELY

RICHARD N. MALOW

MILTON B. MEREDITH

AMERICO S. MICONI

DEMPSEY B. MIZELLE

ENID MORRISON

PETER J. MURPHY, Jr.

HENRY A. NEIL, Jr.

ROBERT C. NICHOLAS III

BYRON S. NIELSON

JOHN G. OSTHAUS

FREDERICK F. PFLUGER

JOHN G. PLASHAL

EDWIN F. POWERs

SAMUEL R. PRESTON

DONALD E. RICHBOURG

EARL C. SILSBY

G. HOMER SKARIN

CHARLES W. SNODGRASS

HUNTER L. SPILLAN

PAUL E. THOMSON

GEORGE A. URIAN

DEREK J. VANDER SCHAAF

EUGENE B. WILHELM

J. DAVID WILLSON

SURVEYS AND INVESTIGATIONS

C. R. ANDERSON

LERoY R. KIRKPATRICK

DAVID A. SCHMIDT

DENNIS F. CREEDON

NOTE.-This Surveys and Investigations supervisory staff is supplemented by selected

personnel borrowed on a reimbursable basis for varying lengths of time from various

agencies to staff up specific studies and investigations. The current average annual full-

time personnel equivalent is approximately 42.

ADMINISTRATIVE SUPPORT

GERARD J. CHOUINARD

PAUL V. FARMER

SANDRA A. GILBERT

EVA K. HARRIS

VIRGINIA MAY KEYSER

MARCIA L. MATTS

FRANCES MAY

GENEVIEVE A. MEALY

JUNE A. MEREDITH

LAWRENCE C. MILLER

MARY ALICE SAUER

DALE M. SHULAW

AUSTIN G. SMITH

RANDOLPH THOMAS

BETTY A. SWANSON

SHARON K. TINSLEY

GEMMA M. WEIBLINGER

MILITARY CONSTRUCTION APPROPRIATIONS FOR

FISCAL YEAR 1974

MONDAY, MAY 14, 1973.

OFFICE OF THE SECRETARY OF DEFENSE

WITNESSES

EDWARD J. SHERIDAN, DEPUTY ASSISTANT SECRETARY OF DE-

FENSE (INSTALLATIONS AND HOUSING)

PERRY J. FLIAKAS, DIRECTOR, FACILITIES PLANNING AND PRO-

GRAMING, OFFICE OF DEPUTY ASSISTANT SECRETARY OF DE-

FENSE (INSTALLATIONS AND HOUSING)

SIGMUND I. GERBER, DIRECTOR, CONSTRUCTION STANDARDS AND

DESIGN, OFFICE OF THE DEPUTY ASSISTANT SECRETARY OF

DEFENSE (INSTALLATIONS AND HOUSING)

REAR ADM. JOHN G. DILLON, DIRECTOR, CONSTRUCTION OPERA-

TIONS, OFFICE OF THE DEPUTY ASSISTANT SECRETARY OF DE-

FENSE (INSTALLATIONS AND HOUSING)

BRIG. GEN. HUBERT O. JOHNSON, JR., U.S. AIR FORCE, DIRECTOR,

FACILITIES MANAGEMENT, OFFICE OF THE DEPUTY ASSISTANT

SECRETARY OF DEFENSE (INSTALLATIONS AND HOUSING)

ALLAN S. KERR, DIRECTOR, BASE REQUIREMENTS, OFFICE OF THE

DEPUTY ASSISTANT SECRETARY OF DEFENSE (INSTALLATIONS

AND HOUSING)

JOHN R. McCREARY, DIRECTOR, FACILITIES PROGRAMING, OFFICE

OF THE DEPUTY ASSISTANT SECRETARY OF DEFENSE (INSTAL-

LATIONS AND HOUSING)

EVAN R. HARRINGTON, DIRECTOR, SPECIAL PROGRAMING, OF-

FICE OF THE DEPUTY ASSISTANT SECRETARY OF DEFENSE (IN-

STALLATIONS AND HOUSING)

FRANCIS B. ROCHE, DIRECTOR, REAL PROPERTY AND NATURAL

RESOURCES, OFFICE OF THE DEPUTY ASSISTANT SECRETARY OF

DEFENSE (INSTALLATIONS AND HOUSING)

GEORGE D. BRUCH, OFFICE OF GENERAL COUNSEL, OSD

GRAFTON F. NICHOLS, OFFICE OF THE ASSISTANT SECRETARY OF

DEFENSE (COMPTROLLER)

CHARLES W. OLIVER, DIRECTOR OF MAINTENANCE POLICY, OF-

FICE OF THE DEPUTY ASSISTANT SECRETARY OF DEFENSE (SUP-

PLY, MAINTENANCE, AND SERVICES)

OPENING STATEMENT BY THE CHAIRMAN

Mr. SIKES. The committee will come to order.

The committee is ready today to begin hearings on the fiscal year

1974 military construction program with representatives of the Office

of the Secretary of Defense.

Mr. Sheridan is the Deputy Assistant Secretary of Defense for

Installations and Housing, two areas that are obviously germane to

this request. I believe I am correct in saying that the Assistant Secre-

tary of Defense for Installations and Logistics has not yet been ap-

pointed, is that correct ?

Mr. SHERIDAN. That is correct. One has been chosen but not nomi-

nated.

Mr. SIKEs. The committee is pleased to have you here today. You

are familiar with our views and concerns. We have always had an

excellent working relationship with you and with your office. We con-

gratulate you on the many important things that you have accom-

plished in the areas for which you have responsibility.

You are very well qualified to discuss the broad outlines of the

fiscal year 1974 request, the areas in which major emphasis is being

put, what we are doing, and what we need to do.

We also are interested in the way in which our military installa-

tions, both at home and overseas, are being managed, and what you

can report with respect to the management of the Defense construction

program itself.

You have an excellent and comprehensive statement, which I have

studied over the weekend. I think it will be a contribution to the

committee's work. You may proceed.

STATEMENT OF DEPUTY ASSISTANT SECRETARY OF DEFENSE

(INSTALLATIONS AND HOUSING)

Mr. SHERIDAN. Mr. Chairman and members of the committee:

I am pleased to appear before this committee in support of the fiscal

year 1974 military construction program. It is a new role for me to

present the military construction program since I have generally

been here in support of the Assistant Secretary of Defense (Installa-

tions and Logistics) or to testify on special projects, such as the ICBM

program and the Southeast Asia construction program. But none-

theless, it is a pleasure for me to speak for the Secretary of Defense

in support of our fiscal year 1974 request.

I find it indeed a challenge to participate with members of this

committee and the entire Congress in the development of a strong

base structure to support the President's strategy for peace. As Secre-

tary Richardson indicated in his posture statement, the President's

strategy for peace contains three elements: adequate strength, true

partnership, and a willingness to negotiate. I would like to dwell on

the first element-adequate strength-and relate the development of

the military construction program to achieving that objective.

It is essential for implementation of the Nixon doctrine to insure

that our Nation has the most modern and up-to-date base structure for

the military forces who must defend us and our way of life. There

must be increased efficiency of all supporting activities and greater

emphasis must be placed on the readiness and effectiveness of our

total forces. The military construction program for fiscal year 1974

is designed to form the basis on which to build toward these objectives.

The fiscal year 1974 military construction program has been devel-

oped in consonance with the long-range needs of the Active and Reserve

Forces. We have considered present and future deployment, the total

force planning concept, the condition of existing facilities, and the

long-range requirements for modernization and replacements, overall

priorities, and specialized needs. Taking all of those factors into

consideration, we are presenting today our total program for the next

fiscal year.

The budget authority requested for fiscal year 1974 is in the amount

of $2.94 billion as compared with DOD requests for $2.66 billion in

fiscal year 1973 which included the June 1972 amendment resulting

from the SALT agreements. Actual enactment in fiscal year 1973

totaled $2.32 billion. The increase in requested fiscal year 1974 budget

authority over the revised amount requested in fiscal year 1973 is due

primarily to additional emphasis on people-related projects such as

bachelor and family housing construction, and medical facility re-

placement and modernization ; facilities for the Navy's Trident weapon

system, as well as continued emphasis on the Reserve Forces and

the pollution abatement program.

The construction proposals contained in the fiscal year 1974 request

are located at approximately 300 named installations and there are

some 680 separate construction projects. In order to conserve time

and avoid duplication in testimony, I have attached to the end of

my statement summaries of these projects, grouped in like construc-

tion categories to permit ready comparison.

COMPARISON WITH FISCAL YEAR 1973

I have a comparison of this year's proposed budget authority with

that enacted for fiscal year 1973.

[The information follows:]

[In millions of dollars!

Fiscal year Fiscal yea

1973 actual 1974 reques

Army........................------------------............................... ------------------------------------------414.0 664.9

Navy-....................................................................------------------------------------------------------. 517.8 685.4

Air Force................................................ ---------------------------------- . 265.5 291.9

Defense agencies........------------------------------------------------------ 19.2 19.1

Contingency... ...................--------------------------------------------------------- 17.5 0

Reserve components.............. ... ............ ....... 121.8 126.2

Family housing ..... .............-............ ...-.- ........ . .... .... 967.6 1,150.4

Total.......... .. ................................. .. 2,323. 4 2,937. 9

PROGRAMING

Mr. SHERIDAN. The 5-year defense program (FYDP) is the heart

of the planning, programing, and budgeting system in the Depart-

ment of Defense. In construction, we seek the orderly replacement of

obsolete facilities and construction of new facilities as new weapons

systems and changes in manpower and missions impact our military

installations. The steady decline of Active Forces since the peak

of the U.S. participation in Vietnam in fiscal year 1968 to a fiscal

year 1974 active duty end strength of 2,233,000 has completed the

transition from war to peace. The fiscal year 1974 military construc-

tion program reflects (1) support of a baseline military strength

which is the lowest since the pre-Korean war period in early 1950,

(2) consolidation and realinements of the missions performed by the

major installations, (3) the shift from a draft-dominated force to an

All-Volunteer Force, and (4) greater reliance on the mobilization read-

iness of the Reserve Forces. The dynamic aspect of this military con-

struction program is a reflection of the great changes that have oc-

curred and are occurring, and will continue to occur as we move toward

the generation of peace that the President has set as our goal.

A large portion of the fiscal year 1974 military construction pro-

gram is directed at improving the attractiveness of military life in

order to maintain an All-Volunteer Force. For example, in this year's

budget we are requesting 11,688 new family housing units, compared

to 11,938 units authorized last year, recognizing that adequate housing

is an extremely important morale factor especially in helping to re-

tain our ,professional officers and noncommissioned officers in whom

we have invested heavily for specialized training. For our single per-

sonnel the fiscal year 1974 program calls for constructing nearly

39,000 bachelor enlisted spaces and 450 bachelor officers' spaces. This

compares with the 35,430 new bachelor enlisted spaces and 905 new

officer spaces approved last year. We are also planning to modernize

approximately 55,000 bachelor enlisted spaces, converting open bay

dormitory facilities into room configured spaces that will be semi-

private and will be decently furnished. Last year, 72,334 bachelor en-

listed spaces were approved for modernization. Nearly 60 percent of

the entire fiscal year 1974 appropriation request is devoted to meeting

housing needs, including operations and maintenance of the existing

military family housing inventory and debt payment. In the area of

personnel support, we are also planning to upgrade our obsolete

medical plant to modern standards and, with your support, should

complete programing this major effort over the next 5 years. In fiscal

year 1974 we have included $147.8 million for improving our medical

facilities. Finally, we are requesting $91.2 million for community sup-

port facilities such as exchanges, gymnasiums, servicemen's clubs,

overseas dependent schools, and other morale related facilities.

The fiscal year 1974 program also contains substantial amounts for

construction of facilities for our Reserve components as well as the

pollution abatement program. I will discuss these in more detail later

in my statement.

We have informed the committee in prior years concerning our

total backlog of construction and as you will recognize this is also a

dynamic and changing index as to the overall construction needs of

the Department of Defense. The most recent figure would indicate

that we have a backlog of $23.2 billion for the active forces, a $1.4

billion backlog for the reserve forces and $1.6 billion for new family

housing. There has been a drop from the figure furnished last year

for the active forces and this comes about generally from three factors:

elimination of facilities needed for the original 12-site Safeguard

program, a reduction in the overall estimate of construction needed

for Trident, and a general screening out by the military departments

of marginal projects. In the case of family housing, the nearly $0.7

billion decrease from the estimated deficit of $2.3 billion reported last

year results largely from the increase in the pay structure for the

military personnel wherein we have enabled our military personnel to

compete on a more equitable basis with the civilian sector of the econ-

omy. We are pleased in the case of the Active Forces, for example, that

we are proposing in this year's request to devote $1 billion to that

portion of our backlog which we term replacement and modernization.

That segment is presently estimated to be $10.8 billion or nearly 47

percent of the total backlog for the Active Forces.

Finally, we have had to make some painful, but overdue decisions

regarding our base structure. This year's program includes a number

of projects which are required in the fiscal year 1974 time frame to

accommodate relocated personnel and missions. While certain adjust-

ments have been made in the past to reduce the size and cost of main-

taining military installations, it has become clear that we can no longer

afford to defer decisions regarding closure and realinement of the

base structure, and I will discuss this in more detail later in my

statement.

FAMILY AND BACHELOR HOUSING

As we move from a draft-dominated force to an All-Volunteer

Force, increased emphasis is being placed on programs which will

better military life and stabilize manpower. We plan to continue to

improve the quality of life in the military services in the environment

of the All-Volunteer Force and with that end in mind, we have sub-

stantially increased the military housing programs during the last

few years. A balanced multifaceted approach to improving the hous-

ing situation in the shortest feasible time has been developed. This

includes both provision of new housing and upgrading the standards

of livability of existing on-base housing. Efforts being directed to the

on-post family housing program include:

(1) Continuing the high level of new construction.

(2) Major modernization of existing housing.

(3) Provision of mobile home facilities.

(4) Broadening the programing base to include all enlisted per-

sonnel in the E-4 grade when computing housing requirements.

(5) As authorized by legislation approved last year, designating

marginally adequate housing as substandard, and renting these units

at less than full forfeiture of BAQ.

In addition to these efforts to improve the family housing situation

on-base, we are also continuing to direct our efforts to securing a greater

share of housing in the civilian community by :

(1) Utilizing the Department of Housing and Urban Development

program which set-aside housing for occupancy by military low in-

come families. However, there is indication that because of the current

freeze on new commitments for subsidized housing coupled with the

cumulative effect of recent pay raises for military personnel, the future

utilization of the "section 236" program for low income military fam-

ilies will not be as great as originally contemplated.

(2) Increasing the leasing of family housing for recruiting

personnel.

(3) Continuing the vigorous housing referral programs at all major

bases and installations to assist in securing housing in the civilian

community.

At overseas areas, we are proposing to expand the foreign leasing

program and encourage lease-construct agreements for military family

housing as a supplement to our continuing efforts under the rental

guaranty program authority. A viable rental guaranty program in

conjunction with an expanded leasing program will considerably as-

sist our housing problems overseas at a minimal risk to the U.S.

Government.

For our fiscal year 1974 family housing program, we are proposing

$1.25 billion, which includes $424 million for construction. This pro-

gram would provide 11,688 new units of family housing, 1,340 mobile

home spaces, over $62 million for the improvement of existing family

housing, and some minor construction and planning. In addition, we

are proposing increased space and livability standards for family hous-

ing and an increased statutory cost limitation on new construction.

The program also reflects an administrative limitation on the number

of two-bedroom units which may be constructed. The bachelor housing

construction program for fiscal year 1974 amounts to $501 million.

This program will provide 39,000 new bachelor enlisted spaces. In ad-

dition, $165 million of this request would be utilized primarily

to convert existing sound structures which are presently open-bay

barracks into modernized room-configured bachelor enlisted spaces.

This effort will provide an additional 55,000 adequate bachelor en-

listed spaces. We are pleased to note that the bachelor housing request

for this year is about 30 percent higher than last year's request.

RESERVE COMPONENTS

As Secretary Richardson has indicated, a well-equipped and fully

manned National Guard and Reserve, deployable on short notice, is

potentially the most economical part of our defense system. Their

revitalization over the past several years, therefore, is encouraging.

The Guard and Reserves are now relied upon as the initial and pri-

mary augmentation for the Active Forces. Consequently, construction

to support these components is essential in the present timetable. The

proposed fiscal year 1974 appropriation bill contains a request for

$126.2 million to provide urgently needed training for the Reserve

components of the Army, Navy, Marine Corps, and Air Force.

The fiscal year 1974 request is the largest Reserve facilities program

proposed to date and represents the third increment of our 10-year

goal to provide an ongoing and continued adequate training facilities

for the Reserve components. It is expected that this continuing em-

phasis, in consonance with corresponding efforts to modernize equip-

ment and other Reserve improvements, will effect a significant im-

provement in the quality of training and the resultant combat readiness

of all Guard and Reserve units. We recognize that modern training

facilities and adequate field exercise areas are a vital adjunct of this

integrated program for upgrading mobilization capability. Accord-

ingly, we will continue to emphasize for the foreseeable future, a

program of modernization of National Guard and Reserve training

facilities.

CONSTRUCTION AGENCIES

Of special interest to the committee has been the assignment of

work to the construction agencies. We have been extremely conscious

of the views of the committee and believe we have developed the most

feasible means of allocating work among the construction agencies.

As you know, pursuant to statutory requirements, the Army Corps

of Engineers and the Naval Facilities Engineering Command are the

primary Department of Defense construction agencies, with the re-

sources of the Air Force utilized when such assignments will be efficient

and economical. The determination of the projects to be assigned to the

Air Force is a function not only of the relative nature, complexity, and

distribution of the Air Force projects but also of the available capabili-

ties of the individual Air Force installation at which projects are pro-

posed. This latter consideration must include the normal workloads

of the installation as well as whether the installation would be simul-

taneously handling an Air Force family housing project. Additionally,

the workloads and existing field office dispositions of the primary

construction agencies must be considered. In summary, the planning

for and assignment of projects to the Air Force involves the close and

mutual coordination between the Air Force staff, the construction

agencies, and representatives of my office.

For fiscal year 1974, the Air Force has requested, and we have ap-

proved, exclusive of its family housing program, the assignment of

$34.6 million of projects. A total of $12.8 million of this represents

projects for which the Air Force will have total responsibility, and

$21.8 million is for projects for which the Air Force will have design

responsibility. We believe that the assignment of responsibility to

the Air Force together with the assignments to the Army Corps of En-

gineers and the Naval Facilities Engineering Command are the most

efficient and effective allocations of the total DOD workload.

A related matter to the assignment of construction responsibilities

has been the level and comparability of costs reported by the various

construction agencies for the design and construction supervision,

inspection and overhead functions. The latter was the subject of a

study conducted by the Office of the Assistant Secretary of Defense-

Comptroller-which was completed in September of last year. A copy

of the report, which was provided to the committee at that time,

concluded that, at present, the costs reported by the Air Force are not

on a comparable basis with those reported by the principal construc-

tion agencies. Most importantly, a detail follow-on study involving all

of the construction agencies was indicated, with the objective cost ac-

counting systems and the comparability of costs reported. My staff

is working with the staff of the Comptroller on this effort as well as

continuing to work with the construction agencies towards our mutual

goal of obtaining the lowest practicable costs for design and con-

struction management.

Concluding this general subject, the Comptroller General completed

a similar study of relative cost comparability and efficiency in a report

dated January 1973. The GAO report confirmed the difficulty of com-

paring costs reported by the various DOD construction agencies and

further indicated that insufficient data were available to make mean-

ingful comparisions of DOD agent costs with those of other Federal

agencies and with the private sector. We concur in general with the

findings and conclusions of this GAO report.

STATUS OF VIETNAM CONSTRUCTION

I would like to briefly discuss the status of Vietnam construction as

I know of the committee's deep interest in 'this subject in the past.

The cost-plus award fee contractor combine of Raymond Morrison-

Knudsen/Brown and Root & Jones completed the work under its con-

tract in Vietnam last June. Lump sum contractors and Vietnamese

Army engineers are completing the remaining projects for improving

the South Vietnamese Armed Forces self-sufficiency, as well as the bal-

ance of the primary highway upgrade program and dependent shelter

program. As in 1972 and 1973, no additional appropriations are sought

this year. In fact, a total of $23,800,000 has been recouped from Viet-

nam military construction appropriations so far and is included as a

source of financing a portion of the fiscal year 1974 military construc-

tion program.

REAL PROPERTY SURVEYS

In February 1970, Executive Order 11508 was promulgated by the

President, assigning responsibility to the General Services Adminis-

tration-GSA-for conducting surveys of all Federal properties in

order to identify unneeded and underutilized properties. The order

also established the Property Review Board (PRB) to make recom-

mendations to the President on the highest and best use to be made

of the resulting excess properties.

Closely allied to this program, in February 1971, the President pro-

posed a new legacy of parks program to help States and local gov-

ernments provide parks and recreation areas for public use. In dis-

cussing the objective of the legacy of parks program, the President

stated that "among the most important legacies that we can pass

on to future generations is an endowment of parklands and recrea-

tional areas that will enrich leisure opportunities and make the beau-

ties of the earth and sea accessible to all Americans." As part of this

program, he has directed the PRB to give priority to potential park

and recreational areas in its search for alternative uses of federally

held real property determined to be excess.

Since July 1971 and in consonance with Executive Order 11508, the

Department of Defense conducted surveys of defense installations in

addition to those being conducted by the GSA. The defense objective

in these surveys was to insure that real property being retained was

sufficient and adequate to support current and long-range require-

ments and that property no longer needed was reported for disposal.

With this purpose in mind, the DOD agreed to over 430 separate ac-

tions involving the release of approximately 1.2 million acres of land

during the period January 1970 to March 1973. As part of this effort,

the DOD undertook over 470 installation surveys and special projects

involving over 14.3 million acres of defense land since July 1971. Since

February 1970 the GSA accomplished 200 surveys of defense installa-

tions involving about 5 million acres of land. We are proud of our

achievements in these areas. We are also pleased that the President was

able to announce in February 1973 that 273 properties had been trans-

ferred to State and local governments in the 50 States, Puerto Rico,

and Washington, D.C., as part of the legacy of parks program. These

properties consist of about 46,300 acres of land with an estimated fair

market value of $136 million. Of the 273 properties, 145 or 54 percent

were formerly DOD properties representing approximately 23,900

acres or 52 percent of the total acreage conveyed.

We are pleased with the results of these programs and we plan to

continue the installation survey effort in 1974 in support of the require-

ments of Executive Order 11508.

INSTALLATION AND ACTIVITY REDUCTIONS AND REALINEMENTS

As you know, on April 17 we announced a significant installation

and activity reduction and realinement package with annual recurring

savings of $375 million after one-time costs. These actions relate to our

identification of those military installations which should be retained

in order to meet our national priorities. Without such installation and

activity consolidations, reductions, and closures, it would not be pos-

sible for the DOD to remain within budget levels. In addition, installa-

tion and activity consolidations and closures had to follow the sig-

nificant reductions in force levels which occurred.

Since 1969, the DOD announced a total of 2,269 installation and

activity reduction, realinement, and closure actions worldwide. These

actions reduced over 302,000 military and over 195,000 civilian person-

nel positions and will result in the reduction of annual defense ex-

penditures of almost $4.4 billion when completed. Although most of the

actions have already been completed, some, including those most re-

cently announced, will not be completed until the end of fiscal year

1974 and a few will take somewhat longer. As part of these actions,

the DOD closed over 400 installations, activities, and properties world-

wide since January 1969.

TURNKEY CONSTRUCTION

I would like to briefly update the committee as to our recent actions

relating to turnkey construction.

First, let me review the turnkey concept and the procedures we

utilize. Basically the turnkey concept involves the use of performance

or narrative specification of the facility requirements, with competing

contractors submitting a technical concept which will satisfy these

Government requirements together with a price for the construction.

In our one step competitive negotiation procedure the technical concept

and the price proposal are submitted simultaneously and are evaluated

to obtain the award decision. In the two step procedure, contractors

first submit a technical concept. After approval of the technical pro-

posals, they then submit a price based upon their own technical pro-

posal-the award going to the low-price bidder.

Two major considerations are, however, involved in the effective use

of tutnkey. First, we must insure that potential proposers can readily

and economically provide design proposals which will in fact meet our

valid facility requirements. Secondly, we must insure that use of these

procedures does not unnecessarily compromise the quality of the design

in order to achieve the lowest bid price.

During the past year we have completed the development of policy

and guidance directed toward the enhanced and uniform use of the

turnkey procedures by the military departments. This guidance rec-

ognizes the two major considerations I addressed, and provides specific

criteria for the most effective application of both turnkey procedures.

Our policy guidance also identifies types of facility projects for

which potential contractors can readily provide acceptable design pro-

posals. The final decision to utilize the turnkey approach is left in each

case to the military department and the contracting officer concerned,

so that this decision can be made in terms of the specifics of the project

and the local contractor market.

In order to clarify the application of the one step competitive nego-

tiation turnkey procedure in accordance with our policy guidance, we

believe it is desirable to obtain certain technical statutory language

changes. This modified language is contained within our legislative

program for this year.

RELOCATABLE BUILDINGS

Within the past two months we have published a Department of

Defense instruction establishing policies and procedures for the use

of relocatable buildings. The instruction is principally directed to-

ward the controlled utilization of relocable buildings to meet interim

facilities requirements, generally of 3 years or less duration, wherein

the use of more conventional construction or other alternative measures

may not be as economical. Additionally, this instruction provides gen-

eral guidance and authority for the establishment of stockage levels by

the services for buildings required to meet contingency requirements.

We believe that this instruction provides for the effective application

of the evolving technology in the field of relocatable buildings to the

urgent requirements of the Department of Defense while maintaining

accord with the military construction authorities and limitations.

NATURAL RESOURCES OONSERVATION

Again this year we would like to discuss briefly our continuing

interest and improvement in the program for the conservation of our

natural resources and in the sharing of these resources with the pub-

lic. As trustee for the third largest land area controlled by the ex-

ecutive agencies, the Department of Defense has a vital concern for

wise use of its forests, proper fish and wildlife management, soil and

water conservation, and recreation opportunities on military lands

for the civilian populace. A total of 237 cooperative agreements have

been developed among the military installation commanders, the

State or county agencies involved, the Department of the Interior

through its regional offices of its Bureau of Sport Fisheries and

Wildlife and with the local offices of the Forest Service and Conser-

vation Service of the Department of Agriculture. These arrange-

ments cover approximately 19 million of the 25.8 million acres of land

and water that we control in the United States and possessions,.

Over 7 million visitors last year took advantage of the recreational

opportunities offered at the many installations open to public hunt-

ing and fishing and other nonconsumptive recreational uses.

Longstanding interagency agreements which had been consum-

mated with the Department of Agriculture and the Department of

Interior governing use of natural resources at Defense installations

are constantly under review to assure the proper relationship of

the DOD natural resources programs to the total environment. De-

fense lands, not currently required, have been made available through

outleasing to State and other Government authorities for park and

recreational use. Professional forestry management is being practiced

on some 2,300,000 acres of Defense land.

Our conservation and natural resources programs have been, for

the most part, financed by the sale of hunting and fishing permits

by the military installations as authorized by Public Law 86-797.

Increased emphasis has been placed on the collection of such fees for

the improvement of local programs with the result that fiscal year

1974 should be one of outstanding accomplishment.

HEALTH CARE FACILITIES

In the area of health care facilities, there are some important and

challenging developments.

Beginning with this year's program, we are embarking on a 5-year

health facilities modernization program. This program has been initi-

ated to accelerate the construction of necessary new medical facilities

and modernization of existing hospitals to provide modern and ef-

ficient medical care. Also, the provision of these improved facili-

ties at an early date will permit better utilization of scarce profes-

sional talent and reduce requirements for health personnel. As I indi-

cated earlier, this initial year of the program includes a total of $147.8

million for medical projects. This compares to an average of $90 mil-

lion over the past 5 years. It is anticipated that funding for this im-

portant program will increase over the next 4 years to assure that the

needed medical facilities are constructed.

The next item of interest is a New Generation Military Hospital

project which is under development. This project involves the con-

struction of a test-bed hospital at Travis Air Force Base, Calif., to

study a wide range of cost effective innovations leading to reduced

overall cost of providing modern health care services. The features

to be tested in this hospital were the product of two comprehensive

systems analysis studies conducted by private industrial management

consortiums.

The Air Force, as program manager, has just completed require-

ment and criteria studies and concept studies are about to get under-

way. It is proposed to request funds for this 600-bed hospital in the

fiscal year 1975 construction program. The Department of Health,

Education, and Welfare, and the Veterans' Administration have co-

ordinated on the development of the studies, and the studies and the

benefits derived will be shared with those agencies and the private

sector.

Also in connection with medical facilities, you will recall that last

year Congress passed legislation which established the Uniformed

Services University of the Health Sciences. Now for the first time

in history, Defense will have the internal capability for training phy-

sicians, which will greatly enhance the all-volunteer service goal.

At this time we are .awaiting the confirmation of appointees to the

board of regents which will establish the necessary policy guidance

to permit site studies and development of the physical facilities to

proceed in an expeditious manner.

POLLUTION ABATEMENT

This year's budgetary request continues the program for abating

pollution at military installations which was started several years

ago. In keeping with national environmental policies, we have again

programed major funding for this important effort. Included in this

year's program is $116.5 million for 98 projects to assure compliance

with current pollution control standards.

With respect to our present standards, we have turned the corner

in our pollution abatement effort. This is reflected in the fact that

funds being requested this year represent a decrease of 33 percent

over our last year's request. However, it is important to note that the

comprehensive Water Pollution Control Act, passed in October 1972,

will result in more stringent standards which will be reflected in fu-

ture programs.

Basically, the program proposes projects to provide proper treat-

ment for sanitary and industrial waterborne wastes. Included in this

effort is a continuation of the program initiated last year to provide

onshore treatment of wastes from naval vessels. The air pollution pro-

gram provides funds for heating plant projects to eliminate sulfur

and fly ash, facilities for processing industrial exhausts and the con-

struction of incinerators and sanitary landfills.

As in the past, all air and water pollution projects in the fiscal year

1974 program have been coordinated with the Environmental Protec-

tion Agency. We very much appreciate the support which this com-

mittee has given to this program in previous years and we trust that

this year's projects will similarly receive your favorable consideration.

AIR INSTALLATIONS COMPATIBLE USE ZONES

A threat to our ability to maintain adequate air strength is urban

encroachment on our air bases. To protect the hard-core bases, we

have begun a policy of establishing compatible use zones in the inten-

sive flying areas. A draft environmental impact statement covering

this action has been prepared in accordance with the National Envi-

ronmental Policy Act.

These zones will be established by many methods, ranging from

local land use zoning to Federal purchase of land. Development in

the zones will not be prohibited, but will be directed along lines com-

patible with the characteristics of airport operation. Typically, resi-

dential development would be discouraged as would development that

would create flight hazards. Light industry, open space recreation, and

commercial uses insensitive to noise would be encouraged. The amount

of land involved will vary with the base and the type of mission sup-

ported. This year, we are asking $25.9 million in authorization for

the Air Force to acquire some 78,605 acres at 13 bases and $5.4 mil-

lion to acquire all 14,365 acres at two bases in the Navy program. How-

ever, since acquisition by exchange of land will be attempted, only $2

million in appropriations for the Air Force purposes will be sought.

The Congress can expect to receive future requests for similar pur-

poses as further encroachment on military airfields becomes evident.

REAL PROPERTY MAINTENANCE ACTIVITIES PROGRAM

The military construction backlog and the correction of deficiencies

through MILCON appropriations also impacts heavily upon our real

property maintenance activities (RPMA) program for which over

$3 billion are expended annually. Necessary operational costs for utili-

ties and services, aging facilities retained for "2 or 3 years" and aus-

tere budgets are resulting in an enforced lowering of the mainte-

nance and repair effort and growth in the backlog of essential mainte-

nance and repair (BEMAR) exceeding $900 million by end fiscal

year 1973, substantially more than the $200 million considered accept-

able for prudent management. As costs continue to escalate, we are

seeking improvements and innovations to reduce the RPMA demand

on the Defense dollar. For example, a program has been instituted

to consolidate RPMA at those areas where there are major installa-

tions in close proximity to one another. To maximize consolidation

efforts, Joint Utilities Review Boards were established worldwide to

provide joint-service organizations to solve mutual utilities procure-

ment problems, insure more effective utilities contract negotiations

and to improve conservation programs. We feel that notable progress

has been achieved and we are continuing efforts in this direction.

I am most appreciative of the opportunity to appear before you to-

day to present the military construction request for fiscal year 1974

to discuss subjects in the installations, construction, and housing areas

which are of interest to this committee. I have attempted to provide

you with some measure of our efforts to achieve a strong base structure

in line with the President's policy of "adequate strength" and we are

hopeful that these efforts will continue for many years to come. We

have been extremely fortunate to have had the support of this com-

mittee over the years and for that, we are sincerely grateful.

I have with me Perry Fliakas, Director for Facilities Planning and

Programing. Mr. Fliakas, the staff and I will be available to answer

your questions and we would be pleased to provide such additional

information as you may request.

Thank you.

[Additional information follows:]

(1) Summary of fiscal year 1974 Military Construction Program.

(2) Addendum-Proposed Construction of Major Facilities Categories.

(3) Proposed Family Housing Program.

14

SUMMARY OF FISCAL YEAR 1974 MILITARY CONSTRUCTION APPROPRIATION PROGRAM

[In millions of dollars]

Army Navy Air Force

Active forces, military departments facility class:

Operational and training..... ------------

Maintenance and production-.....--------

R. & D. facilities --.......---------- ----

Supply facilities-- .-.......---------

Hospital and medical --.....-. - -- -

Administrative facilities ....-. .. . -

Housing and community ...-..........

Utilities and ground improvements -..-.--

Real estate ........---------------------

General support activities - ....- --- - --

Total direct program--..- .-......

Less financing adjustments._ -

82.3

16.4

11.2

8.1

45.8

6.0

453. 4

29. 5

2.7

51. 5

706. 9

42. 0

123. 5 60.4 266.2

132. 3 36.9 185.6

29.3 10.0 50.5

2.1 11.7 21.9

65. 3 36.7 147.8

17.6 31.1 54.7

104.0 68.1 625.5

152.9 22.0 204.4

.6 2.0 5.3

69. 8 33. 0 154.3

697.4 311.9 1,716.2

12.0 20.0 74.0

Budget authority (and appropriation) -......... 664.9 685.4 291.9 1,642. 2

Defense agencies:

Direct program -.- -...... ........... .....................------------- 49.1

Less financing adjustments.................... .............. -30.0

Budget authority (and appropriation) ----------------------------------------------- 19.1

Reserve forces: (direct program, budget authority and appropriation) ..-............................ 126.2

Family housing:

Direct program ....... . ...... ........ ......... ...... ...... ...... ...... ... 1,161.5

Less financing adjustments ........... ..................... .. ....... ............... -11.1

Budget authority .. -...-. .... ..... ............. ...... . ....... ...... .. 1,150.4

Plus appropriation applied to debt reduction ............................................ +100.2

Appropriation-... -.- - ----------------- 1,250.6

Homeowners assistance:

Direct program ....-........... -. ............ ............... ... .... -.... .. ...... 5.0

Less financing adjustments . ........ ...... .... ............ ..........------------------ -5.0

Budget authority (and appropriation) - ..- .-- - - O

SUMMARY

Direct Budget

program authority Appropriation

Active forces:

Military departments--

Defense agencies ---..

Reserve forces ----..

Family housing..-....--

Homeowners assistance-- .

Grand total ..---------

-.--- .- 1,716.2 1,642.2 1,642.3

-.--- 49.1 19.1 19.1

126.2 126.2 126.2

1,161.5 1,150.4 1,250.6

- 5.0 0 0

......... 3,058.0 2,937.9 3,038.1

PROPOSED CONSTRUCTION IN MAJOR CATEGORIES OF FACILITIES

Active Forces (Titles I, II, III, and IV)

The Active Forces portion of the military construction budget program for

fiscal year 1974 totals $1,765.3 million for the three Departments and Defense

Agencies. This portion of the program is related to the regular Military Establish-

ment and provides for facilities and installations necessary to meet operational,

logistical, and other mission requirements of the three military departments and

the defense agencies, other than family housing. For purposes of easy summation,

we have grouped the total request into nine standard Department of Defense

construction categories. I would like to describe the principal items contained in

each of these categories for the individual services. I will omit reference to the

defense agencies in these descriptions, inasmuch as I will summarize their

requirements separately at the end of this presentation. The first of the categories

is:

Operational and Training, $266.2 million.

The operational facilities contain essential airbase, fleet operations support,

communications, security, command and control, and other operational facilities

necessary to support the combat readiness capability of the services. Under train-

ing facilities we seek to provide the instructional and training facilities necessary

to the development of not only the basic soldier, seaman, airman, and marine, but

also the technical and professional specialists required to operate, maintain, and

repair the complex tools of modern war.

Within the above total, the requests for such facilities are:

Army-$82.3 million.

Navy-$123.5 million.

Air Force-$60.4 million.

The most significant portion of the Army's request, which totals $82.3 million,

involves $60 million for financing the U.S. share of the NATO infrastructure

program additionally the program provides $7.2 million for aircraft facilities at

Fort Hood, Tex.; $1.6 million for helicopter facilities at Fort Belvoir, Va.; $7.6

million for academic and school facilities at Fort McClellan, Ala., Fort Meade,

Md., Fort Monmouth, N.J., and Fort Sheridan, Ill.; $0.9 million for petroleum-

oil-lubricants (POL) facilities in Korea; and various operational and training

facilities at five other installations for a total of $5 million.

Of the $123.5 million included in this category for Navy, $72.3 million is for

operational facilities and $51.2 million for training facilities. Of the $72.3 mllion

for operational facilities, $9.9 million will provide improvements and additions to

airfield pavements at six Navy installations; $5.7 million for communication fa-

cilities at eight Navy installations; $3.5 million for aircraft operations facilities

at seven installations; $21.8 million for waterfront facilities at three Navy

installations; and $31.3 million for a wharf and dredging in support of Trident at

Patrick Air Force Base, Fla. The Navy's training facilities request includes $6

million for adademic instruction facilities at Annapolis, Dam Neck, and San

Diego; and $45.2 million for urgently needed enlisted training facilities at 18

Navy installations.

The Air Force program for operational and training facilities totals $60.4

million, of which $52.6 million is for operational facilities, and $7.8 million for

training facilities. Signficant items within the operational facilities portion in-

clude $13.5 million for facilities for the newly approved airborne command post

to support national command authorities at Andrews Air Force Base, Md.; $11

million for an addition to the technical intelligence operations facility at Wright-

Patterson Air Force Base, Ohio; $7.9 million for communications facilities,

navigational aids and airfield lighting; $4.1 million for airfield pavements; $5.4

million for a composite support facility at Cape Newenham Air Force Station,

Alaska; $4.5 million for an air freight terminal at Hickam Air Force Base,

Hawaii; $4.7 million for a fire station and operations buildings: and $1.5 million

for miscellaneous facilities. The training facilities include: $2.8 million for a

base maintenance training facility at Sheppard Air Force Base, Tex.; $2.8 million

for a flight simulator training facility at Reese AFB, Tex. ; and $2.2 million for

four miscellaneous training facilities.

Maintenance and production facilities, $185.6 million.

This category includes all types of facilities necessary for the production,

maintenance and repair of military hardware, including field and depot main-

tenance shops and hangars, shore-based marine maintenance facilities for the

fleet, and production, assembly and maintenance facilities for rockets, guided

missiles and various types of conventional ammunition.

The totals of the services' requests for such facilities are :

Army-$16.4 million.

Navy--$132.3 million.

Air Force--$36.9 million.

Within the Army's portion of their total request, the appropriation would pro-

vide $16.4 million for various shop and maintenance facilities at four major bases

in the United States. Approximately $8.4 million of the request entails construc-

tion of phase III of an airfield complex to support an airnobile division at Fort

Campbell, Ky.; $3.8 million would finance vehicle repair and processing facilities

at Anniston Army Depot, Ala. ; $2.7 million is required for tactical equipment

shops at Fort Bragg, N.C. ; $1.1 million for turbine engine test cells at the aero-

nautical maintenance center, Tex. ; and $0.4 million for medical equipment main-

tenance facility at Memphis Depot, Tenn.

Significant items included in the Navy request for maintenance and produc-

tion facilities include $22.3 million related to aircraft maintenance at 12 air sta-

tions; $12.1 million for ships maintenance facilities at five installations: $1 ml-

lion for a vehicle maintenance facility ; $6.5 million for ammunition maintenance

20-192 (Pt. 1) 0 - 73 -- 2

16

facilities at three installations; $91.7 million for the first phase of the Trident

refit complex all Bangor Annex, Wash.; and $0.4 million for three miscellaneous

projects.

The appropriation requested for the Air Force in this category will provide

the necessary facilities to support the maintenance of new weapons systems and

will provide for increased Air Force missions, changes in missions, and safety

of operations. Significant amounts entered in this category are $22.9 million for

various aircraft maintenance shops including among the major items, a depot

aircraft engine fuel system overhaul and test facility at Kelly AFB, Tex., $3.2

million; alteration of a depot aircraft overhaul facility at Robins AFB, Ga., $1.4

million; a depot aircraft lapding gear overhaul facility at Hill AFB, Utah, $6.9

million; a weapons system components plate shop at McClellan AFB, Calif., $2.5

million; a depot aircraft electronics system overhaul and test facility at Tinker

AFB, Okla., $3.3 million; ayd 10 miscellaneous aircraft maintenance shops at

six locations, $5.6 million. In addition, this category includes 5 aircraft corrosion

control facilities at 5 locations, $1.9 million; 3 precision measurement equipment

facilities at 3 locations, $2.3 million; a base civil engineer maintenance complex

at Dover AFB, Del., $0.8 million and at Peterson Field, Colo., $1.8 million; short-

range attack missile maintenance support facilities at 2 locations, $1 million;

communications and electronics shops at 3 locations, $1.1 million; and 7 miscel-

laneous maintenance facilities at 5 locations, $5.1 million.

Research and Development Facilities, $50.5 million.

This portion of the appropriation program is necessary to sustain our search

for new and improved weapons systems. Despite its modest size, the Department

considers the projects included herein to be of high essentially and vital to the

maintenance of U.S. leadership in the development and testing of new defense

systems.

The total of the Services' requests for R. & D. facilities are:

Army-$11.2 million.

Navy--$29.3 million.

Air Force--$10.0 million.

The Army's request involves $11.2 million with $3 million required for a

human factors engineering laboratory at Aberdeen Proving Ground, Md.; $2.7

million for an explosives laboratory at Picatinny Arsenal, N.J.; and $2.7 million

to provide improvements to test range facilities at Yuma Proving Ground, Ariz.

Additionally, $2.8 million is requested to provide for various laboratories and

support facilities at six locations in the United States and instrument test facili-

ties at Kwajalein Island.

For the Navy, 14 research and development facilities total $29.3 million, and

includes $6.4 million for the second phase of an environmental health effects

laboratory at Bethesda, Md.: $4.7 million for an integrated electromagnetic test

and analysis laboratory at NRL Washington, D.C. ; $3.6 million for an engineer-

ing building at New London. Conn.; $3.5 million for an electronic development

and test laboratory increment at San Diego, Calif.; $5.4 million for facilities at

the Naval Coastal Systems Laboratory at Panama City, Fla.; $3.8 million for

facilities at Patrick AFB, Fla., in support of the Trident missile development;

and $1.9 million for miscellaneous facilities at three Navy installations.

The Air Force program for R.D.T. & E. facilities contains the following sig-

nificant items: $4.0 million for aircraft fuels and lubricants laboratory and $1.9

million for alterations to an aircraft engine components and research laboratory

at W'rihlit-Patterson AFB. Ohio; $0.1) million for alterations to a rocket pro-

pulsi.... searchh laboratory at Edwards AFB, Calif. ; $0.9 million for a weapons

guidance test facility at Holloman AFB, N. Mex.; and $1.4 million for five mis-

cellaneous projects at five locations.

Supply facilities, $21.9 million.

This category includes various supply facilities, including fuel storage, am-

munition storage, cold storage, depot and arsenal warehouses and open storage

facilities.

The total of the services' requests for such facilities are:

Army-$8.1 million.

Navy-$2.1 million.

Air Force--$11.7 million.

The Army's request includes a container transfer and marshaling facility at

Sunnto Point Termin al, N.(., $1.6 million; a multiunit supply operations and

storage building at tie Aeronautical lMaintenance Center, Tex., $5.2 million;

a logistic and storage facility at Cold Regions Laboratory, N.H., in the amount

of $0.6 million; and a supply and administrative facility at Fort Eustis,

Va., for $0.7 million.

The Navy's request includes two warehouse facilities and one cold storage

facility totaling $2.1 million. The $11.7 million requested for supply facilities

for the Air Force will provide $5.4 million for a logistical materials storage

facility at Tinker AFB, Okla.; $1 million for a base supply facility at

Reese AFB, Tex.; $3 million for a ballistic missile processing support facility

at Hill AFB, Utah; and $2.3 million for five miscellaneous storage facilities.

Hospital and medical, $14.7 million.

Replacement and improvement of our outmoded and obsolescent medical plant

continues as one of our urgent priorities. A great portion of our hospital and

medical facilities were constructed from 25 to 50 years ago, and over the years

have become increasingly inadequate to the needs of modern medicine. In fiscal

year 1974, we have included a substantial increment to continue the replacement

of the most inadequate of such facilities.

The total of the services' requests for such facilities are :

Army-$45.8 million.

Navy-$65.3 million.

Air Force-$36.7 million.

Army's request for hospital and medical facilities includes a new hospital at

the U.S. Military Academy, $25 million; an addition at Fort Lee, Va., for $5.3

million; three dental clinics at Fort Carson, Colo., Fort Lewis, Wash. and Fort

Monmouth, N.J. for $3.5 million; a medical-dental clinic at Fort Shafter,

Hawaii, for $1.2 million and parking facilities at the Walter Reed Medical

Center in the amount of $10.8 million.

Significant items included in the Navy request for health and medical facilities

include the $22.3 million, 310-bed hospital at Orlando, Fla; $3.4 million, 150-

bed addition to the hospital at New Orlean, La.; and $39.6 million for dis-

pensaries, dental clinics, and upgrading of medical facilities at 20 Navy in-

stallations.

Within the Department of the Air Force, the $36.7 million requested for hos-

pital and medical facilities will provide for the following: Additions and/or

alterations to the composite medical facilities at Maxwell AFB, Ala., $4.9 million;

Tinker AFB, Okla., $3.9 million; and Richards-Gebaur AFB, Mo., $3.8 million;

new composite medical facilities at RAF Upper Heyford, United Kingdom, $5.5

million; Laughlin AFB, Tex., $4.6 million; and F. E. Warren AFB, Wyo., $5.8

million; aeromedical staging facilities at Andrews AFB, Md., $1.7 million, and

Scott AFB, Ill., $2 million; and dental clinics at Keesler AFB, Miss., $1.7 million;

Barksdale AFB, La., $1.2 million; and Sha1w AFB, S.C. $1.1 million; and a

medical clinic at Lackland AFB, Tex., $0.5 million.

Administrative facilities, $54.7 million.

The total requested for administrative facilities, including headquarters, squad-

ron operations, and similar facilities is $55 million. Within this total, the service

increments are:

Army-$6 million.

Navy-$17.6 million.

Air Force-$31.1 million.

Army's request for administrative facilities is relatively minimal in nature

and includes $3.2 million to relocate Defense Department activities to Bayonne,

N.J., in connection with the closing of the Brooklyn Army Terminal; alterations

to an existing structure at Fort McClellan, Ala., for an addition to WAC Head-

quarters in the amount of $0.3 million; and various other alterations and con-

versions at Fort Dix, N.J., Fort Knox, Ky., Fort Bragg, N.C., and Fort

Monmouth, N.J., in the amount of $2.5 million.

The Navy's $17.6 million request for administrative facilities includes $1.8

million for relocation of the Military Sealift Command from Brooklyn to

Bayonne, N.J.; $9.8 million for administrative facilities at New Orleans, La.;

$52 million for administrative facilities at Albany, Ga.; $0.2 million for a com-

puter support facility at Philadelphia, Pa.; and a $0.7 million administrative

facility at Meridian, Miss.

The Air Force program provides $31.1 million which includes $20.4 million

for the Air Force Accounting and Finance Center at Lowry AFB. Colo.; $4 million

for an Armament Development Test Center Headquarters at Eglin AFB, Fla.;

$3.6 million for base personnel offices at Nellis AFB, Nev.-$1.9 million- and at

Mather AFB, Calif.-$1.7 million; $1.5 million for a Data Processing Plant at

Randolph AFB, Tex.; $0.9 million for alterations to a Command Headquarters

18

Facility at Howard AFB, Canal Zone; and $0.7 million for administrative

facilities.

Housing and Community Facilities, $625.5 million.

Troop housing is one of the most important and vital requirements in our con-

struction program. We recognize the importance of this item in persuading

personnel to stay in the military service as a career, and we believe implicitly that

improved housing will provide both immediate and long-range benefits through

increased reenlistment, heighten morale, and reduced recruitment costs. The

Service programs in fiscal year 1974 are:

Army-$453.4 million.

Navy-$104 million.

Air Force-$68.1 million.

The Army's request for troop housing and community facilities, represents a

continuation of last year's reorientation of construction priorities with major

emphasis being placed on "peoples projects" designed to improve the conditions

under which Service personnel and their families work and live. The request

includes construction of 24,553 bachelor enlisted spaces and support facilities

at $237.7 million; modernization of 46,896 existing bachelor spaces at $143.6

million; construction of 285 bachelor officer quarters at $4.9 million; moderniza-

tion of 528 existing bachelor officer spaces at $2.7 million; a bachelor enlisted

complex support facility at $2.6 million; and three projects for consolidated din-

ing facilities and centralized food preparation plants at $13.7 million. Addi-

tionally, the program includes 22 community facilities at $48.2 million. These

provide two dependent schools in Germany at $12.1 million; two confinement

facilities in the United States at $10.7 million; and various chapels, commis.

saries, libraries, gymnasiums, and similar facilities at 14 other Conus bases in

the amount of $22.8 million.

The Navy's programing for this category will provide 9,368 new bachelor en-

listed spaces at a cost of $58.4 million; 2,719 modernized bachelor enlisted spaces

for $8.6 million; 103 new bachelor officer quarters at a cost of $3.3 million; 126

modernized bachelor officer spaces for $1.4 million; enlisted dining facilities at

a cost of $8.2 million; community support items totaling $14.6 million; and com-

pletion of the naval home facility at Gulfport, Miss., for $9.4 million.

The Air Force program for this category provides $39.7 million for troop hous-

ing facilities and $28.4 million for community facilities. The $39.7 million will

provide 4,768 bachelor enlisted spaces at a cost of $25.6 million; modernization of

existing bachelor enlisted quarters to provide 4,757 spaces at a cost of $11.3

million; 60 bachelor officer quarters for $1.2 million; $0.6 million for construction

of an airmen dining hall at Webb AFB, Tex.; and $1 million for modernizing a

dining hall at Lackland AFB, Tex. The $28.4 million for community facilities

will provide for additions and alterations to three chapel centers, $1 million; three

commissaries, $7.4 million; three gymnasiums, $2.7 million; two high schools

and one intermediate school, $7.4 million; two airmen open messes, $2 million;

four noncommissioned officer open messes, $5.4 million; one officers open mess,

$1.1 million; and four miscellaneous community projects, $1.4 million.

Utilities and Grounds Improvements, $204.4 million.

This portion of the program provides for expansions and additions to utility

systems and road nets at various U.S. and overseas locations. A significant ele-

ment of this year's, as in last year's, program is directed toward further imple-

menting the national policies for controlling water and air pollution. The

military department totals in the category of utilities and ground improvements

are as follows:

Army-$29.5 million.

Navy-$152.9 million.

Air Force--$22 million.

In compliance with Federal, State, and local air and water. pollution control

regulations and Executive Order 11507 (4 Feb. 1970), there is included a total of

$116.5 million for 98 pollution abatement projects as a continuation of the pro-

gram begun 5 years ago to eliminate pollution at our military installations. All

of these projects have been coordinated with the Environmental Protection

Agency.

19

The pollution abatement projects in each of the service programs are sum-

marized as follows:

Air pollution abatement Water pollution abatement

Millions Projects Installations Millions Projects Installations

Army ---------------- $7.3 7 7 $7.1 7 6

Navf ------------------ 27.6 18 15 64.7 45 39

Air Force --------------- 3.7 6 6 6.1 15 15

Total ... ..... 38.6 31 28 77.9 67 60

The Army's request includes $14.4 million for pollution abatement; $15.1 million

for utilities systems including $8.7 million for electrical distribution or augmenta-

tion of power facilities; $0.3 million for a gas generating plant; $0.5 million for

extension of a parkway at Fort Benning, Ga.; and $5.6 million for miscellaneous

utility extension items at the U.S. Military Academy, N.Y., White Sands Missile

Range, N. Mex., Fort Polk, La., Atlanta Depot, Ga., and Fort McClellan, Ala.

Significant items included in the Navy request for utilities include $92.3

million for pollution abatement, $42.8 million for electrical power distribution

improvements at 26 installations; $8.3 million for heating plant and distribution

system improvements at four installations; $3.1 million for water supply and

distribution improvements at three installations; and $6.4 million for miscel-

laneous utilities and ground improvements at nine installations.

This portion of the Air Force fiscal year 1974 military construction program

will provide expansion and additions to existing utility systems worldwide.

Significant items included in this category are $9.8 million for pollution abate-

ment projects; $3.5 million for electric power distribution lines, emergency

power, and substations; $3.3 million for power and air conditioning improvements

at six locations; $3.9 million for expansion of base utility systems at two loca-

tions; and $1.5 million for three miscellaneous utilities projects.

Real estate, $5.3 million.

This portion of the program provides for real estate acquisitions and is by far

the smallest category in the fiscal year 1974 request. The services' requests are as

follows :

Army-$2.7 million.

Navy-$0.6 million.

Air Force---$2.0 million.

The Army's request of $2.7 million provides for acquisition of 71,159 acres

of privately owned land located within the boundaries of the White Sands

Missile Range, N. Mex.

The Navy's request includes $0.6 million for acquisition of 129 acres at Yuma,

Ariz. Approximately $5.1 million is included under the Trident refit complex to

acquire land at the Bangor Annex, Naval Torpedo Station, Keyport, Wash.

The Air Force request for real estate totals $2 million as a second increment

to acquire land and restrictive easements in support of the air installation

compatible use zones program.

General support activities, $154.3 million.

This portion of our budget request includes funds required for planning and

design, construction of military access roads, minor land acquisition under

$25,000, and financing of minor construction projects authorized under stand-

ing legislation contained in 10 U.S.C. 2674. The amounts requested for each of

the services for these activities are as follows :

Minor Supporting

Planning construction activities Total

Army ................................... 39.0 12.5 .......-.. 51.5

Navy -------------------------------- 53.8 15.0 1.0 69.8

Air Force-------------- ------------ 18.0 15.0 - -~. . .... 33.0

Total--.. ..----------------------------- 110.8 42.5 1.0 154.3

20

The requests for general support funds are relatively modest and similar to

that requested last year. The requests for minor construction funds are small in

magnitude when compared with other elements of the total request, however,

we consider these funds most important as they constitute the only immediately

available source of funds to finance those relatively small but urgent projects

which inevitably evidence themselves during the fiscal year. We strongly urge

the committee to approve them in total.

Defense agencies (title IV), $49.1 million.

The request for activities of the Defense agencies contains $17.1 million for

new construction and rehabilitation of existing facilities at 12 installations and

$2.0 million for general support activities for which we are seeking appropria-

tions, and $30 million for the Secretary of Defense Contingency Fund which will

be financed with previous appropriations. The $49.1 million program is divided

as follows :

Defense Nuclear Agency ($0.6 million) to provide for an advance research

electromagnetic pulse simulator (ARES) support building at Kirtland Air Force

Base, Albuquerque, N. Mex.; and a DNA administration building at the Atomic

Energy Commission Nevada Test Site, Las Vegas, Nev.

Defense Supply Agency ($8.4 million) to provide for an improved electrical

distribution system, and a truck entrance and control facility at the Defense

Construction Supply Center, Columbus, Ohio; medical materiel climatic controlled

storage, upgrade restroom and lunchroom facilities and a troop subsistence sup-

port facility at the Defense Depot, Mechanicsburg, Pa.; ventilation of warehouses

at the Defense Depot, Memphis, Tenn.; upgrade restroom facilities at the Defense

Depot, Ogden, Utah; an operational equipment maintenance facility, fire station

and improvement and modernization of the water system at the Defense Depot,

Tracy, Calif.; a photographic materiel storage facility and a defense fuel supply

center at the Defense General Supply Center, Richmond, Va.; a parking lot at the

Defense Logistics Service Center, Battle Creek, Mich.; quality control laboratory

improvements at the Defense Personnel Support Center, Philadelphia, Pa.; and

facility improvements at the regional office, Defense Contract Administration

Services, Chicago, Ill.

National Security Agency ($8.1 million) to provide for relocation of shop

facilities, logistics support facility, modernization of bachelor enlisted quarters,

and an automated waste collection system at NSA Headquarters, Fort George G.

Meade, Md.

GENERAL SUPPORT ACTIVITIES ($2.0 MILLION)

This portion of the Defense agency budget includes $1.0 million each of funds

required for planning and design, and for financing of minor construction projects

authorized under standing legislation contained in 10 U.S.C. 2674.

CONTINGENCY FUND ($30.0 MILLION)

The Department of Defense is not requesting any new appropriation in fiscal

year 1974 to finance contingency authorization available to the Secretary of

Defense for construction deemed vital to the security of the United States. Cur-

rently available obligational authority from prior years is considered sufficient

to meet anticipated needs based on recent years usage levels.

SUMMARY OF HOUSING PROGRAM

The fiscal year 1974 family housing program contains a request for 11,688 new

units and a total appropriation request of $1,250,567,000 for the following func-

tions:

Construction of new housing (11,688 units) : Thousands

Army (6,135 units) -------------------------------- $178,208 $351, 904

Navy (3,741 units)-------------------------------117,675

Air Force (1,800 units)---------------------------- 55,501

Defense Intelligence Agency (12 units) -------------- 520

Construction of mobile home facilities (1,340 spaces) _____________ 5,700

Acquisition of utility system------------------------------------ 240

Improvements to existing quarters--............................ 62,510

Minor construction ... _ _ 2,720

Planning __ _ --------------------------------------- 2,720

----------------------------------____-----------------___ 00

Total appropriation request, construction___________________ 423,

Thousands

Operating expenses ---------------------------------------- 334, 210

Leasing -------------------------------------------------------- 44, 703

Maintenance of real property------------------------------------- 294, 419

Debt payment-principal 103----------------------------------------- , 585

Debt payment-interest and other expense 58, 408

Mortgage insurance premiums-Capehart and Wherry-------------- 2, 206

Serviceman's mortgage insurance premiums----------------------- 3, 780

Total operation and maintenance and debt payment---------- 841, 311

Less: Anticipated reimbursements and amounts available from prior

years ------------------------------------------------------ -14, 518

Appropriation request, operation and maintenance and debt payment_ 826, 793

Total appropriation request-------------------------------1, 250, 567

FISCAL YEAR 1974 REQUEST

Mr. SIKES. You mentioned that the amount included in this year's

budget for replacement and modernization is approximately $1 billion.

Let me say that I am pleased with the fact that the military construc-

tion program requested this year has increased somewhat over last

year. I think this is in keeping with the committee's views on the need

for pushing ahead with the military construction program.

We particularly have stressed housing, both for families and for

bachelor personnel, and that is emphasized in this year's budget. So,

I am happy at the progress that is being made in the general field.

Does this increase really bring the fiscal year 1974 budget estimate

about in line with last year's bill when you consider inflation, or is it

actually an improvement over last year's bill ?

REPLACEMENT AND MODERNIZATION

Mr. SHERIDAN. I think it is an improvement, because in the replace-

ment last year we had $610 million. For replacement in the 1974

budget, the request covers $1.010 billion.

On modernization, the percentage of the total appropriation re-

quested last year amounted to 45 percent, and this year it amounts to

59 percent of the total.

It is beyond just taking care of inflation.

Mr. SIKES. I am pleased that that is the case.

We have discussed the fact that the amount included in this year's

budget for replacement and modernization is approximately $1 billion.

Provide for the record a comparison we have been able to achieve in

this area in recent years.

[The information follows:]

Funds for replacement and modernization have gradually increased from a low

of $175 million in fiscal year 1969 to $610 million in fiscal year 1973. This year's

request includes approximately $1 billion for replacement and modernization.

The following table shows the amounts and proportions of the replacement and

modernization of the total amount for the Active Forces portion of the military

construction program.

22

5-YEAR SUMMARY OF REPLACEMENT AND MODERNIZATION FUNDS

Total Replacement and modernization

appropriations

(millions) Millions Percent

Fiscal year:

1969 ..............- $1,182 $175 15

1970 .......... ... ...... ..........-- .------ 1,024 245 24

1971 .......... ..... ............------------------------------------........ 1,262 325 26

1972 ...............---------------------------------------......... ------- 1,202 479 40

1973........- .... ....... . .. . . ........ 1,357 610 45

1974-------------............. . .... ... ............------------------------------- 1,716 1,010 59

Request.

Mr. SIKES. With regard to replacement and modernization, overall,

would you consider that we are catching up, or is that true only in

certain areas such as bachelor housing and medical facilities ?

Mr. SHERIDAN. The emphasis, of course, is on bachelor housing and

medical facilities, but the $1 billion being requested this year, we feel,

is approaching an annual plateau that would mean that in 10 years,

we would be in very good shape.

MEDICAL FACILITIES MODERNIZATION

Mr. SIKES. You mentioned that the average amount for health care

facilities over the past 5 years has been $90 million. Is this year's re-

quest a real increase, or does it just keep up with inflation ?

Mr. SIERIDAN. The allowance for inflation amounts to about 11

percent, or about $14.6 million out of a total of $147.8 million. The

remaining $42.4 million represents an increase in level of effort of

47 percent over the past 5-year average.

NEW GENERATION HOSPITAL

Mr. SIKES. You stressed the development which has taken place at

Travis Air Force Base. What differentiates this new type of hospital

construction, that the services have been so impressed with?

Mr. SHERIDAN. The basic concept behind the new generation hos-

pital is to avoid having a hospital obsolete by the time the construc-

tion is finished. That has happened quite often in the past, both in

military hospital construction and civilian hospital construction.

Starting off with the idea of reaching into the future hospital cri-

teria that will be followed in the years ahead, we had studies per-

formed, which was called phase I, of this project. If I may, I would

like to ask Mr. Gerber to expand.

Mr. SIRES. Yes. I would like to have more information on this.

Mr. GERBER. In a general way, sir, this facility will incorporate the

latest state of the art, both in delivery of health care as well as the

efforts-

Mr. SIKES. What does that mean, Mr. Gerber? What is different

about it?

Mr. GERBER. For example, sir, it will consolidate in a maximum mode

the capability of electronics relating to both communications and

health care, monitoring of the patient as well as services supportingthe

patient, both in the testing facility and the clinical areas, the intensive

care units, the coronary care units, the pharmacy, as well as down to all

levels of plant engineering.

Although a lot of this is being done on a unilateral basis in many

medical facilities throughout the United States now, this project will

maximize and consolidate into one facility so, hopefully, that we can

have a cost-effective facility as well as minimizing the necessary ef-

forts on the part of the professionals.

Mr. SIRES. Is this patterned after civilian hospitals, or it is a new

development ?

Mr. GERBER. It takes advantage of what is being done in the civilian

community as well as what has been done in an experimental nature in

the military medical area.

Mr. SIREs. Will this be a test hospital, the first of a kind, or have

you already endorsed the concept and is it planned to use this approach

in other military hospitals ?

Mr. GERBER. In the findings of our phase I study that Mr. Sheridan

referred to, many of the recommendations can indeed be retrofitted

into existing facilities. Some others have to be put into a new facility

such as the one we are designing for Travis.

Mr. SIKES. You propose to build a new hospital at Orlando. Will

that hospital be patterned after the Travis program, or does it follow

the more conventional type hospital

Mr. GERBER. The answer is, yes and no, sir. Comparing Orlando to

Travis, Travis is a regional hospital for the Air Force. The Orlando

requirements are basically for a station hospital and are not as broad

on a regional or teaching requirements basis as we will have at Travis.

Travis is both a teaching hospital and a regional hospital. Therefore,

it has a greater scope of health beneficiary services.

Mr. SIRKES. Is the type of construction that you plan at Travis sig-

nificantly more costly than the type of hospital you have been

building?

Mr. GERBER. Yes, sir, primarily because of the magnitude of elec-

tronics that will be incorporated into it.

Mr. SIRKES. How will the public or the military benefit from that

additional cost ? Will there be added efficiency or improved capability ?

Mr. GERBER. There will be both added efficiency and improved capa-

bility, and particularly long-range benefit from the lessons, hopefully,

to be learned.

Mr. SIKES. You have not generally embarked on a hospital con-

struction program of the Travis design. This is really a pilot program,

is that correct?

Mr. GERBER. That is correct, sir. However, there has been much coor-

dination with the private community as well as the other Federal

agencies, such as Public Health Service and Veterans' Administration.

Mr. SIKES. Are all of them cooperating with you in this program ?

Mr. GERBER. Yes, sir.

Mr. SIRKES. Have they made suggestions about design ?

Mr. GERBER. They had input into our early Phase I studies, and they

will continue to work with us in the evaluation process.

Mr. SIKES. Are they learning from you, or vice versa ?

Mr. GERBER. It is a mutual effort, sir. It goes in both directions.

24

Mr. SHERIDAN. We were at Orlando 2 weeks ago, Mr. Chairman, and

the people there, in discussing their new hospital, feel that theirs is

going to be the hospital of the future. So, there is competition there that

will be interesting to watch, too, developing better standards, and so

forth.

FISCAL YEAR 1974 HEALTH CARE FACILITIES PROGRAM

Mr. SIKES. Provide for the record the details of the presently pro-

posed fiscal year 1974 health care facilities program, including the

amount of planning money to be obligated.

[The information follows:]

FISCAL YEAR 1974 HEALTH CARE FACILITIES PROGRAM SUMMARY

[In millions of dollars]

Facilities Planningand

Military departments cost design cost

Army---------------...............................................----------------------------------------.................. 45.8 2.494

Navy....-------........-----------------------------......................................-----------------------65.3 3.350

Air Force-----------...........................---------------------------------------..............---------....... 36. 7 1.900

Total------------------------------..--.........................----------------------- 147.8 7.744

DETAILED LIST OF HOSPITAL AND MEDICAL FACILITIES APPROVED FOR INCLUSION IN

THE FISCAL YEAR 1974 MILITARY CONSTRUCTION PROGRAM

ARMY, FISCAL YEAR 1974

Installation and project Cost

U.S. Military Academy, new hospital__________________________ $25,000,000

Fort Lee, Va.. addition to the Kenner Army Hospital -------------- 5, 310, 000

Fort Carson, Colo., dental clinic, 28 chairs ----.--_...___________ 1,036,000

Fort Lewis, Wash., dental clinic, 28 chairs______________--------__ 1,200,000

Fort Monmouth, N.J., dental clinic, 32 chairs----------_________ 1, 198, 000

Fort Shafter, Hawaii, medical/dental clinic---------------------- 1,233,000

Walter Reed Medical, parking facilities__________________________ 10, 830, 000

Total appropriations _____________________________________ 45, 807, 000

NAVY, FISCAL YEAR 1974

Cost

Installation and costs thousandn)

NH Great Lakes, Ill., hospital modernization and upgrade__ $_____----2,800

NTC Great Lakes, Ill., medical and dental processing facility __------ 1,923

NH Guam, modernize intensive care unit______________________________ 177

NAS Cecil Field, Fla., dispensary addition_____________________________ 107

NH Quantico, Va., hospital alterations --------------------------------484

NH New Orleans, La., nursing unit addition------------------ 3,38

NH Oakland, Calif., hospital alterations____________________________ 4,260

NH Orlando, Fla., hospital replacement__________________________ 22,312

NS Pearl Harbor, Hawaii, preventive medicine unit____________- 845

NAS Lemoore, Calif., dental clinic ---------------------------------- 1,333

NTC Orlando, Fla., dental clinic------------------------------------1,481

NAS Barbers Point, Hawaii, dispensary and dental clinic _____________4,306

Charleston NSY, S.C., dispensary addition____________________________ 252

NAS Chase Field, Tex., dispensary and dental clinic__________ 2300

NTC Great Lakes. Ill., dispensary and dental clinic__________________ 4,259

NAS Kingsville, Tex., dispensary and dental clinic-------------------- 2,054

NAB Little Creek, Fla., dispensary and dental clinic___________________ ,211

NAS Meridian, Miss., dispensary and dental clinic_____________________ 2,500

NSGA Skaggs Island, Calif., dispensary and dental clinic______---41

NAS Whiting Field, Fla., dispensary and dental clinic----- -2,186

MCRD San Diego, Calif., dispensary........--------------------- - 3,825

NH Guantanamo Bay, Cuba, air conditioning________________________ 0

Total appropriations ----------------------65,275

.........................................

AIR FORCE FISCAL YEAR 1974

Cost

Installation and Project (thousands)

Upper Heyford RAF, U.K., composite medical facility-__ _------------ $5, 525

Laughlin AFB, Tex., composite medical facility ___________----------- 4, 635

Maxwell AFB, Ala., add to and alter composite medical facility-------- 4, 900

Richards-Gebaur AFB, Mo., add to and alter composite medical facility__ 3, 758

Tinker AFB, Okla., add to and alter composite medical facility-_____ 3, 879

F. E. Warren AFB, Wyo., composite medical facility ____________------5, 834

Andrews AFB, Md., aeromedical staging facility ___________----------- 1, 739

Scott AFB, Ill., aeromedical staging facility_---------------- 2, 019

Lackland AFB, Tex., dispensary --------------------------------- 450

Keesler AFB, Miss., dental clinic --________-__-________________- -- 1, 666

Barksdale AFB, La., dental clinic 1------____----- ------_______ ---1, 200

Shaw AFB, S.C., dental clinic- ...--------- ...-----------..._... .. 1, 089

Total appropriations--------------__------------------ ---- 36, 694

Mr. SIKES. What are the objectives of this program in terms of what

its goals are and when they will be met ?

Mr. SHERIDAN. The objectives of the medical facilities modernization

program are to replace outmoded and inefficient military hospital and

clinic facilities, improve efficiency and functional relationships, satisfy

current hospital accreditation, fire, and safety standards, and improve

the satisfaction of patients, physicians, dentists, and other health care

personnel to enhance the achievement of an all-volunteer force.

These objectives were to have been met during the 5 years, fiscal year

1974 through fiscal year 1978, but several projects originally planned

for fiscal year 1974 were deleted due to insufficient design progress and

may result in extending the program until fiscal year 1979.

LONG-RANGE MEDICAL PROGRAM

Mr. SIKES. What is the average program projected for fiscal year

1975 through fiscal year 1978 ?

Mr. SHERIDAN. The average total military medical facility construc-

tion program for each of the fiscal years 1975 through 1978 is about

$400 million.

CROSS-SERVICE MEDICAL CARE

Mr. SIKES. What success has there been in attempting to coordinate

Defense medical care on a cross-service basis?

Mr. SHERIDAN. An Armed Forces regional health service system

has been established to organize and manage the delivery of health

care in specified geographical areas to achieve economies and increase

productivity without unnecessary duplication of resources.

The concept was tested in four regions beginning on July 1, 1972.

Communications and cooperation among the three services has im-

proved during this test, and there is demonstrated evidence of in-

creased productivity, improved procedures in the delivery of health

care, and monetary benefits.

The test also demonstrated that problems within the regions can be

resolved at the departmental level without coming to the Office of the

Secretary of Defense. Planning for worldwide implementation is

under way with a target date of July 1, 1973.

', Mr. SIKEs. Have you established procedures to program for medical

facilities on a cross-service basis ?

Mr. SHERIDAN. Yes, sir.

Mr. SIKES. How do those procedures work ?

Mr. SHERIDAN. Medical facilities planning personnel within the

Office of the Assistant Secretary of Defense (health and environment)

receive and coordinate military department recommendations for all

medical facility construction.

The proposals are evaluated based on installation and geographical

requirements, the impact on other governmental and community medi-

cal facilities, the scope of the project and its sophistication.

Coordination with the comprehensive health planning agencies is

also accomplished.

Recommendations are then presented for approval to the hospital

planning review panel in OSD. This panel consists of representatives

of the Office of Management and Budget, the Assistant Secretaries of

Defense for Manpower and Reserve Affairs, Installations and Logis-

tics, Health and Environment, and the Comptroller, plus the military

departments' Surgeons General.

COSTS OF HIGHER STANDARDS

Mr. SIKES. The Active Forces deficit of $23.2 billion as well as the

figure of $10.8 billion for modernization presumably take into ac-

count the quantum jump which has been made in the last few years

with regard to the type of bachelor housing considered adequate. Also,

we are building medical facilities to be more flexible and, hopefully,

cheaper to operate. The Army is proposing the same thing with its cen-

tralized messing facilities.

It costs more money to build to these new standards. This is the price

of this.

The question is: Is it worth the cost ? This committee is more expert

on some items than others. I think we know something about housing,

and we have stressed housing. That is a little easier to understand

than hospital construction or even centralized messing.

This committee fully endorses the new standards on family housing

and bachelor housing. We do not doubt their desirability even when

measured against cost.

But in the field of medical facilities, centralized messing, and some

training areas, if we were building facilities to the older standards,

the figures would be considerably lower, would they not ?

Mr. SIIERIDAN. For construction costs, they would be.

Mr. SIKES. What do we gain by spending the additional money ?

LMr'. SHERIDAN. The completely new feeding system is designed to

reduce the overall cost of feeding the troops, improve the quality of

the food, reduce food wastage, and encourage higher utilization of

dining facilities.

When we consider the cost differences between the central preparl-

tion facilities and dining facilities having their individual prepara-

tion capabilities, the central system, as now proposed by the Army,

will simplify the dining facilities and further reduce overall operating

costs.

It is apparent right now-we 'have gone far enough on this--thatin

the feeding systems where there are a large number of dining facilities,

the use of central food preparation will provide the greatest overall

reduction of the total cost, while simultaneously offerino- uniform hi'

quality prepared food.

This program should have been started many years ago. I think

it is very well thought out.

Mr. SIKES. You mean we have had the design and the proposals

but there has been reluctance to embark on it because of the higher in-

vestment costs ? Has that been the problem ?

Mr. SHERIDAN. Yes, sir, that is it.

Mr. SIKEs. How much more percentagewise is it costing to build to

the new standards for hospitals, barracks, and central messing facili-

ties? Can you give us that information ?

Mr. SHERIDAN. May we provide that for the record?

Mr. SIKES. Please do.

[The information follows:]

HOSPITALS

The criteria for hospitals have been revised in several areas since the fiscal

year 1973 program. The allocations for mechanical equipment, physical therapy,

central material, and intensive care have been increased nominally to overcome

documented deficiencies. The resultant average increase to military hospital

costs is about 3.4 percent.

BARRACKS

The basic barracks standards for housing personnel in the fiscal year 1974

program remain the same as in fiscal year 1973. However, we have made a minor

adjustment in the total gross square feet of area of E2-E4 personnel from 150

square feet in fiscal year 1973 to 155 square feet in fiscal year 1974. Due to

this change, there is an increase of about 3.5 percent in the fiscal year 1974

barracks costs as compared with fiscal year 1973.

CENTRAL MESSING FACILITIES

A comparison of construction costs for upgrading dining facilities to con-

tinue the present food service system versus the construction costs for central

food preparation facilities (CFPF) is dependent upon the dining facilities cur-

rently available at each installation. For example, Fort Benning would re-

quire $10,750,000 to upgrade their present food service systems, modernizing 28

dining facilities, and constructing five new consolidated dining facilities to re-

place the World War II structures presently being utilized. The Fort Benning

CFPF and upgrading of associated dining facilities are expected to cost $9,230,-

000, or 14% less. This yields a net savings in construction costs of $1,500,000 for

the CFPF versus upgrading the present system in the present mode.

The Fort Lee comparison yields different results. Fort Lee is presently utiliz-

ing all permanent dining facilities. Therefore, to upgrade the present system at

Fort Lee would cost approximately $1,250,000. This is much less than the cost of

the Fort Lee CFPF which would be approximately $10,575,000. However, the

Fort Lee CFPF will also contain classrooms and provide the Army with their

food service doctrine procedures and training facility. The two installations,

however, illustrate -the fact -that comparisons must be made on a case basis at

each installation.

The comparison of only construction costs does not consider the savings in-

volved in operating costs when you compare a machine intensive system

(CFPF) with a manual intensive system (present food service system). Be-

sides offering a more cost-effective, flexible system, the CFPF is expected to re-

duce labor costs by at least one-third annually.

BACHELOR AND FAMILY HOUSING AND OTHER CONSTRUCTION PROGRAMS

Mr. SIKES. Provide for the record a table showing the number of

bachelor enlisted and officer spaces built and modernized, the num-

ber and cost of family housing units built and the cost of family

housing modernized; the number and cost of hospital beds constructed

as approved in each program for the last 5 years and proposed in

Oscal year 1974. Also show the amounts programed for other cate-

gories of facilities.

[The information follows:]

NEW AND MODERNIZED BACHELOR HOUSING BUILT FISCAL YEARS 1969-73 AND PLANNED FOR FISCAL YEAR 1974

IDollar amounts in millions)

Barracks Bachelor officers' quarters

New Modernized New Modernized

Number Number Number Number

Fiscal year of spaces Amount of spaces Amount of spaces Amount of spaces Amoun

1969 ......------------------- 15,665 $50. 5 .....-....... .... 3, 308 $36.8 480 $0.5

1970 ..-------------------. 36,603 126. 9 23,848 $8. 7 1,900 19.9 610 1.7

1971- ....... 24, 604 103.8 8,858 8.9 1,574 20.3 173 .6

1972 -....-.........._ .. 25, 548 126.8 99, 534 85. 0 2, 604 36. 8 523 2.7

1973 ...... ...-------------------.... 35,430 219. 2 71,434 144.4 905 15.6 813 3.8

1974_ _------------------- 38, 689 321. 8 54, 372 163. 5 448 9. 4 654 4.1

NEW AND MODERNIZED FAMILY HOUSING BUILT FISCAL YEAR 1969-73 AND PLANNED FOR FISCAL YEAR 1974

IDollar amounts in millions

New

Modernized

Number of units Cost cost

Fiscal year:

1969 ..--------------------------------------------- 2,000 $42.9 ...............

1970..---------------------------------------------.... 4, 800 + 105. 5 $11.5

1971-------.....----.................. ... ....-------------- ....... 8,000 194.8 19.2

1972..............._._...- ....- ... .. .. .......... 9,862 257. 5 32,7

1973-----........... ... ...........---------------...... ........ 11,938 302.2 43.6

1974... ......-----------............................... 11,688 351.9 625

NUMBER AND COST OF HOSPITAL BEDS CONSTRUCTED DURING FISCAL YEARS 1969-73 AND PLANNED FOR

FISCAL YEAR 1974

lin millions of dollars

Number of beds Cost

Fiscal year:

1969--- ------------------------------------------------------ 1,548 53.5

1970 --- -- ------ ------ ----655 25.2

1971---- ------------------------------------------------------- 960 51.4

1972---- 1,645 155.5

1973 --------------------- 590 47.6

1974---- ------------------------------------------------------- 615 65.4

COMPARISON OF MILITARY CONSTRUCTION APPROPRIATION BY FACILITY CLASS, FISCAL YEAR 1969-FISCAL YEAR

1974

[All amounts in millions of dollars!

Enacted fiscal year- Requested

Facility class 1969 1970 1971 1972 1973 fisca1974

Operational and training.............. 382. 4 276.6 464.3 209.3 142. 7 206. 2

Maintenance and production....... 123.4 105.4 84.6 100.6 105.6 185.6

R. & D---............--------------- 51. 8 36.4 62.3 55.3 87.5 50. 5

Supply......----------------------- 23.0 38.3 9.9 24.4 34.3 21.9

Hospital and medical............... 63.4 28.3 109.8 150.1 94.6 147.8

Administrative ......-......-....... 10.9 21.3 24.9 20.5 14.4 54.7

Housing and community. --........ - 101.7 219. 3 188.6 306. 5 487.0 625. 5

Utilities and ground improvements-.. 53.2 115.4 130.4 164.8 219.9 204.4

Real estate....................... 5.8 7.1 6.6 19.8 2.2 5.3

NATO infrastructure................. 47.0 50.0 41.5 14.0 48.0 60.0

Southeast Asia..................... 207.1 ............ 25.0 .....................

General authorization................ 112.0 125.7 133.1 121.1 138.0 154.3

Subtotal TOA.. ............. 1,181.7 1, 023.8 1, 281.0 1, 186. 4 1, 374. 2 1, 716. 2

Financing adjustments...... ... . -120.0 -152.3 -47.4 -4.9 -176.9 -74.0

Subtotal NOA................ 1, 061.7 871. 5 1, 233.6 1, 181. 5 1, 197. 3 1, 642. 2

Defense Agencies.................. 83.4 33. 9 46. 3 14.8 36. 7 19. 1

Subtotal-Active Forces....... 1,145.1 905.4 1,279. 9 1, 196.3 1,234.0 1,661.3

Family housing .................. 583. 7 688. 5 806. 5 945.0 1, 064.0 1,250.6

Homeowners assistance.............. 6.2 ....................... 7.6 13.3 .........

Reserve components................. 23.3 53.1 42.0 90.6 111.8 126.2

Total........................ 1,758.3 1, 647. 0 2, 128. 4 2, 239. 5 2, 423. 1 3, 038. 1

Mr. SIKES. Also provide for the record the corresponding dollars

and, if possible, the numbers of units programed for the 4 out-years;

that is, fiscal years 1975 through 1978.

[The information follows :]

NEW AND MODERNIZED BACHELOR HOUSING PLANNED FOR FISCAL YEAR 1975 THROUGH FISCAL YEAR

1978

[Dollar amounts in millions]

Barracks

New Modernized

Number Number

of spaces Cost of spaces Cost

Bachelor officers' quarters

New Modernized

Number Number

of spaces Cost of spaces Cost

fiscal year:

1975............... 40, 391 $380. 1 67, 639 $53.9 1,195 $19.5 998 $1.9

1976 ............... 34, 433 321.4 81, 032 60.4 1,325 22.1 2, 297 4.4

1977.......... ..... 28, 384 266.6 14, 893 38.2 4,047 72.7 783 4.0

1978........... .. .. 28,189 251.0 19, 743 59.8 3,878 70.6 339 2.6

NEW AND MODERNIZED FAMILY HOUSING PLANNED FOR FISCAL YEAR 1975 THROUGH FISCAL YEAR 1987

[Dollar amounts in millions]

New

Number of units Cost Modernized cost

fiscal year:

1975 ------ 13,538 $396.9 $62.5

1976.... 11, 906 351.2 62. 5

1977---------... ................................ 10,706 310.3 62. 5

1978... -' - - - - ------ - - - - _- -. . ---... .- .-.... 8,680 252.3 62.5

NUMBER AND COST OF HOSPITAL BEDS PLANNED FOR FISCAL YEAR 1975 THROUGH

FISCAL YEAR 19781

Number of Cost

beds (millions)

Fiscal year:

1975..........

1976.........

1977.......

1978..........

The amounts shown in the preceding tabulations for fiscal year 1975 through 1978 represent internal Department of

Defense planning estimates only, covering anticipated program levels which have not been approved by the President

COMPARISON OF MILITARY CONSTRUCTION APPROPRIATION, BY FACILITY CLASS, FISCAL YEARS

1975-78

[In millions of dollarsl

Fiscal years-

Facility class 1975 1976 1977 1978

Operational and training ....................

Maintenance and production...

R. & D....

Supply ...-

Hospital and medical-...

Administrative ---....... .

Housing and community----

Utilities and ground improvements_ _... .. _

Real estate ---... ...................

NATO infrastructure ...--.-. ..... . .

Southeast Asia-......... ..------------------

General authorization----------------------.....

Subtotal, GOA--- ...

Financing adjustments ..... .- - ..-......

Subtotal, NOA......-------... .......

Defense agencies... ... . . ._ .._.. .__

Subtotal, Active Forces --- .... . .

Family housing- .. . . .. . . .. . . .. . .

Homeowners assistance

Reserve compouents----.....-...............

Total.........

-....... 210 150 160 169

325 232 164 126

70 68 67 71

45 47 55 50

437 358 323 308

35 42 37 60

649 582 515 497

__.__... 176 177 153 119

19 8 3 11

-.. 60 60 60 60

..5..... 153 143 141 140

2, 179 1,867 1,678 1,611

....... 2, 179 1,867 1,678 1,611

_ .._ 50 44 44 46

2, 229 1,922 1,722 1,657

.. . . 1, 101 1, 179 1,183 1,191

5 5 5 5

-.....- 143 141 144 149

- .- 3,478 3,236 3,054 3,002

BARRACKS STANDARDS

Mr. SIKES. I wish you would discuss what is proposed in the fiscal

year 1974 program with regard to new barracks standards and what

that is going to cost.

Mr. SHERIDAN. As I previously mentioned, the basic barracks stand-

ards for housing personnel in the fiscal year 1974 program remain

the same as in fiscal year 1973. The housing accommodations provide

a three-man room of 270 net square feet with an adjacent bathroom

for E2 through E4 personnel. This same size room is being provided

for E5-E6 personnel on the basis of two-man occupancy and for El-

E9 personnel at one man per room.

However, as I have previously stated, we have made a minor ad-

justment in the total gross square feet of area for E2-E4 personnel

from 150 square feet in fiscal year 1973 to 155 square feet in fiscal

year 1974. This increase was considered necessary to permit a better

development of the design of the total barracks facility with respect

to the ancillary requirements such as corridors, laundry rooms,

------------ ----------- ----------- -----------

lounges, and office space. Also, due primarily to escalation in con-

struction costs, we are recommending an increase in the statutory

limitations from $27 to $28.50 per square foot. Due to these changes,

the cost of barracks spaces in the fiscal year 1974 program is approxi-

mately 10 percent higher than in fiscal year 1973.

FAMILY HOUSING STANDARDS

Mr. SIKES. There is an increase also in criteria proposed for family

housing in the fiscal year 1974 program. We will discuss this in great

detail with Mr. Fliakas this afternoon. This committee has pressed

for higher standards for family housing. Are we actually getting

higher standards, or are we simply getting an increase to take care of

inflation? Tell us what you are requesting and how it compares with

prior years.

Mr. FLIAKAS. We are requesting increases in the statutory net floor

area, for selected grades.

Mr. SIREs. But will you still have to build to a lower standard

of housing. What are you getting other than an inflationary cost

increase?

Mr. FLIAKAS. We hope to get, with the new statutory limits, an

increase in dining rooms, in secondary bedrooms, and in additional

bathrooms-for example, in a 2-story house, a full second bath on

the second floor as opposed to the half-bath or the 11/2 baths that are

authorized now-and with the gross area that is reflected in these

increases, some additional interior storage space.

As you know, sir, with your prompting 2 years ago, we initiated

an occupants' survey in which the military departments had a ques-

tionnaire in which we encouraged all the occupants, and especially the

wives, to indicate their degree of satisfaction with our military hous-

ing. We attempted to learn some lessons from these surveys. A good

many of our recommendations are predicated on just that evaluation.

Mr. SIKES. What did the wives tell you about the housing ?

Mr. FLIAKAS. You would be surprised, sir; generally, it is considered

that we have offered fairly decent housing, but there are many com-

plaints with respect to size, privacy, and storage. Overall, I would

say that more people are satisfied than dissatisfied.

Mr. SIKES. I think that is miraculous. I do not know of many wives

who are fully satisified with their houses.

Mr. FLIAAS. They offered recommendations, especially with respect

to size and privacy.

Mr. SIRES. Those were the principal things?

Mr. FLIAKAS. Yes.

General JOHNSON. And a requirement for a toilet on the first floor

of a 2-story residence.

Mr. FLIAKAS. Many of our improvement projects are furnishing

a powder room on the first floor, which is missing in our older housing.

Mr. SIKES. I will agree that is an important improvement.

Mr. FLIAKAS. I think I would be remiss if I did not answer fully

your question with respect to whether we will get these standards.

We are seeking them, and we hope that we will be able to obtain these

higher standards within the money, but I must caution that if the cur-

rent spiraling cost of construction continues, we may not be able

fully to accomplish them.

20-192 (Pt. 1) O - 73 -- 3

Mr. SIKES. Can you do it under the budget estimates, which include,

of course, the cost increases for which you are seeking authorization?

Mr. FLIAKAS. I would have to say that we will have to have a level-

ing off of the current escalation to the levels that we had predicted

when we put this estimate together last winter. I will be very candid

in saying that we had predicted a 6-percent increase for cost growth

and that already is inadequate.

Mr. SIKES. Will you spell out for the record just where we will be

insofar as current cost estimates are concerned, including anticipated

inflation, what improvements you now think you will be able to build

and which you cannot build under these estimates ?

Mr. FLIAKAS. Yes, sir, we will provide that.

[The information follows:]

Using the fiscal year 1973 cost limitation as a baseline, the proposed fiscal year

1974 cost limitation included a predicated 6 percent cost growth factor plus con-

siderations for increased livability and programing changes addressed in the

opening statement. Cost records based on actual cost growth show that the anti-

cipated 6 percent increase was actually 9 percent. It is anticipated that the

higher cost growth will generally prohibit the construction of the quarters for

senior NCO's at the higher standards proposed.

LABOR RATES

Mr. LONG. I have always been concerned about the tremendous in-

flation in construction costs because of the Walsh-Healy and Davis-

Bacon Acts, and Public Contracts Act. I was talking to Secretary

Shultz last week, and he indicated that the impact of those laws had

been modified. I think he said Walsh-Healy was virtually inoperative.

I am wondering to what extent those laws are still in effect and to

what extent the Defense Department is trying to get that artificial

inflation of costs modified or thrown out.

Mr. SH'ERIDAN. Dr. Long, that surprises me very much, because I

have not heard anything along that line. That has been one of our

big problems in cost increases. I have not heard of any indication to

that effect.

Mr. FLIAKAS. There was a temporary suspension of Davis-Bacon

about 2 years ago, but this is not applicable any longer.

Mr. LONG. Walsh-Healey and Davis-Bacon are in full force?

Mr. SHERIDAN. That is right.

Admiral DILLON. Davis-Bacon is the law that applies to construe

tion, and it is the one that is most operative and the one that keeps

costs of labor high.

Mr. SIKES. It was suspended for only 3 or 4 months.

Mr. SHERIDAN. It was out, and then back in again.

Mr. LONG. Why was it suspended, and why was it brought back in?

Mr. FLIAKAS. It was in conjunction with the moratorium on con-

struction, I believe, about 2 years ago.

Mr. SIKES. It was an effort on the part of the administration, as I

recall it, to hold down inflation and to keep costs down, but there were

a lot of protests, and apparently it was not accomplishing very much.

Actually, it was dropped before they had a chance to find out what it

would accomplish.

Mr. SHERIDAN. That is correct.

Mr. LONG. My observations had been that it is very hard on small

local contractors, because they cannot turn off and on. In other words,

a small local contractor in a small county like Carroll County, Md.,

cannot bid on Government construction and pay Walsh-Healey and

Davis-Bacon high wages, and subsequently bid on a local project, say-

ing, "All right, boys, the party is over; you have to go back to realistic

local wages." Small local contractors cannot touch these contracts so

the contracts are awarded to big, national construction companies

which are very high-cost producers.

What are we doing about proposing legislative changes or about

possibly holding up construction in certain areas until these people

have become more realistic? For example, we know about the case at

West Point where they soaked the heck out of us. When I was at West

Point in April, I was told-although others disagreed-that labor

costs were running about $100 a day per worker.

What can be done to hold up construction there until these people

start talking turkey ?

Mr. SHERIDAN. Taking West Point as an example, the private sec-

tor of the economy is going ahead in that same area with an extensive

construction program. The cost for power generating facilities for the

New York City area is having the same increase as for the military.

If we did not go ahead with the construction program at West Point,

I do not believe, after being in this subject for quite a few years, that

would have any impact on the contractors' prices, because they have

enough outside business, but it would have a distinct impact on the

lack of fulfilling the requirements for the Academy. So we would

suffer, and the result would be that when you get ready to go ahead

maybe 5 years from now, or whatever the trial period might be, then

the costs will have gone up so that we would not only have been without

the facilities for that period of time, but also we would have paid

increased costs when we do get them.

We are not the sole center of the construction market.

Mr, LONG. I understand. I would think it would be marginally very

important. It is wrong for these men to be paid fantastic salaries to

travel from New York City up to West Point and all the way back

again, that is, double pay or worse.

Mr. SIKEs. I understood there had been some improvements. The

portal-to-portal pay from New York City, for instance, I agree, is an

abomination. Have there been any improvements in that picture ? Is

anyone here prepared to discuss it ?

Admiral DILLON. I do not have information on that, but I will pro-

vide it for the record.

[The information follows:]

Portal-to-portal pay, which means the payment of hourly wages for the time

traveled from home to the jobsite and return, is not being used at West Point.

Instead workers are being provided a daily travel allowance, such as $4.50 a

day which boilermakers receive for their travel.

There has also been some improvement in construction labor rates as a

result of the Construction Industry Stabilization Committee's (CISC) actions

to abate the rapid rise of wages. For instance, bricklayers were scheduled for

a wage increase of 84 cents an hour effective June 1, 1972, but CISC intervened

and approved an increase of 53 cents instead.

Mr. SIKES. We will have that information when the Army wit-

nesses are here. They will have details on it. We want to go into that.

HIGHER COST OF GOVERNMENT CONSTRUCTION

Mr. LONG. I am interested in that from the standpoint of our whole

construction program and how military building costs compare with

comparable construction costs in the private economy.

Mr. SHERIDAN. YOU have to look at that in two ways. I am not trying

to evade the answer. You get reduced standards in the military com-

pared to comparable income areas in civilian life because of the added

cost of building on the base.

Mr. LONG. I have seen the houses, and they are not as good as the

houses you can buy on the private economy, but they cost just as much,

even though the Government is providing the land and other facilities.

The average enlisted man is paying for it in a lower standard of living

and the taxpayer is paying just as much for it.

Mr. SHERIDAN. About 20 years ago, we had a test program at Fort

Belvoir, where the Army took the plans for that development just

south of the Hunting Creek and, using exactly the same plans perhaps

a year after the private building had been completed, the cost was

18 percent to 20 percent higher. The inflation rate was not going up

fast at the time.

That is the only comparative figure I know.

Mr. SIKES. Historically, the military have had requirements in their

construction that have caused prices to be higher than for a comparable

house in the private economy. I believe that is one of the reasons for

turnkey houses. You were trying to get away from some of that.

Mr. SHERIDAN. That is correct, sir. That was one of the arguments

used in favor of the turnkey approach.

Mr. SIKES. We will go into all of that in more detail later.

STANDARDS FOR FISCAL YEAR 1974 PROGRAM

In what other areas in the fiscal year 1974 program do you propose

higher criteria or better standards ?

Mr. SHERIDAN. We propose improved design criteria in a number

of areas, including energy conservation, safety of structures in earth-

quake zones, and environmental considerations.

In the design of new facilities in connection with energy conserva-

tion, we are requiring an evaluation of a new kind of energy conserva-

tion system to minimize the cost of the energy.

On the earthquake construction, based on data obtained from the

1971 San Fernando, Calif., earthquake, revised criteria has been de-

veloped to provide buildings with improved capability to withstand

seismic forces. That will improve the life safety and operational fea-

tures located in those seismic areas.

In environmental considerations, the general policy has been adopted

that personnel type facilities should not be sited in high-noise areas,

such as those near aircraft runways. Where such siting cannot be

avoided due to land restrictions or other reasons, we require that the

facility be designed to attenuate the outside noise to a degree which

will result in a reasonably quiet and pleasant interior.

We have also relaxed our requirement to permit increased use of

air-conditioning in our buildings in order to be more comparable to the

private sector provisions.

35

Mr. SrKEs. Since we mentioned comparability of standards between

Government housing and housing in the private sector, I would like

some detail for the record on the differences in those standards which

are resulting in higher costs for what is apparently the same housing

so far as living convenience is concerned.

Mr. SHERIDAN. Yes, sir.

[The information follows:]

The major differences in our criteria and in some instances that of the private

sector is in the area of construction material quality in those portions of the

house known to have an impact on the maintenance and operation cost and energy

conservation. The following are typical comparative examples :

Material Military Nongovernment private sector

Paint...................--------------. Exterior: Paint quality controlled by speci- Exterior: Paint quality not controlled by

fiction requirements in an effort to specification, choice normally left to

reduce maintenance painting through developer who has no maintenance

extended life. Normal repainting cycle of reponsibility after 1 year.

5 years.

Interior: Paints having good washability Interior: No washability requirement speci-

characteristics specified to reduce interior flied since developer not responsible for

maintenance painting requirements. maintenance painting.

Exterior cladding materials Quality of materials selected to provide for Quality of material selected primarily on the

(siting and roofing). low maintenance and to give the appro- basis of initial appearance and providing

priate service in the climate to which the service for the initial construction 1-year

material is exposed. warranty period.

Thermal insulation ...-..... Prime consideration given to physical Prime consideration given to minimum

comfort and energy conservation in speci- physical comfort in determining quantity

fying quantity and qualtiy of insulating and quality of insulating materials.

materials.

These differences in criteria are necessary because of the high turnover in

occupancy in our housing and the need to properly manage the expenditure of

operation and maintenance dollars.

SECTION 236 HOUSING

Mr. SIKES. We are going to talk about all phases of housing in much

more detail, but at this point I would like to have some information

on the section 236 program. This is an area in which this committee

has a particular interest, but because of the higher pay for the lower

grades of enlisted personnel, some of them now are being priced out

of eligibility for section 236 housing.

I note that you are now making the E-4's eligible for on-base

housing; is that correct ?

Mr. FLIAKAS. That is correct, sir.

Mr. SIKES. That will eventually take care of one group, but for

those who still are not eligible for on-base housing, what do you pro-

pose to do to improve their eligibility under the 236 program? Do

you propose a change in language ?

Mr. FLIAKAS. Not at this time in specific reference to the 236 pro-

gram as it has been operating. It is true, as you say, Mr. Chairman,

that our extended and future use of the program will decline. However,

it is still expected that we will have requirements at some installations

for those personnel that can qualify under the guidance or the regu-

lations as they now exist.

As you know, however, the Department of HUD is working on a

housing reform study and recommendations which will, hopefully,

continue some form of subsidized housing and some form of military

met-aside.

36

We have been in communication with HUD. We have had many

discussions with them and have exchanged correspondence with re-

spect to the application of the current freeze on subsidized housing.

In answer to your inquiry with respect to legislation, we have turned

our attention somewhat to a different area, which will still benefit all

grades, and especially the lower grades. We have proposed that HUD

extend their insurance activity and support to nonmetropolitan areas,

the so-called high-risk areas that have a military impact.

Mr. SIKES. As I am sure you recall, last year this committee dis-

cussed with the Banking and Currency Committee, the Housing Sub-

committee, this area, and at our request that committee included in

their bill a section which would have accomplished this.

That bill fell by the wayside last year. Presumably there will be a

housing bill this year, and I think we can have that language included.

If you are familiar with the language, does it meet the requirements?'

Mr. FLIAKAS. It does, sir. I am familiar with it. We have proposed

essentially the same to HUD again.

Mr. SIKES. Are you also proposing that the eligibility of certain

military personnel be determined on the basis of the grade they hold

rather than the salary they get ?

Mr. FLIAKAS. Not for the 236 program per se, Mr. Chairman. We

have included language in our proposal to HUD to permit subsidized

housing to be built under their insurance programs in nonmetropolitan

areas, which then, rather than just confining it to the low income, would

also benefit the middle income categories as well.

Rather than just eligibility for 236, it will be supplemented, we

hope, by eligibility for other insurance programs like the 222(d) (3)

program, for example. We think this is the direction to go.

We have said that we still have the requirement for the 236 pro-

gram in selected areas as it now is constituted. We hope to have both.

CONSTRUCTION BACKLOG

Mr. LONG. In connection with the construction backlog, what are

the deficits in each category of facilities now, and what will they be

upon completion of the fiscal year 1978 construction program?

Mr. SHERIDAN. We have a tabular summary by category of facili-

ties. A $23.2 billion backlog for the Active Forces is available, and

I would like to furnish it for the record.

[The information follows:]

MILITARY DEPARTMENTS TOTAL FACILITY DEFICIENCY (EXCLUDES CURRENT YEAR)

(MILITARY CONSTRUCTION) BY FACILITY CATEGORY

Facility category : M(Uons

Operational and training_______________________________-------- $3,301

Maintenance/production ..................................--- - 3, 325

Research and development___ ________-__-_____ ---_______-__ --- 1,680

Supply -------___________________________ -------------------------------------------------- 1,3860

Medical .__________________ .__________ ________ 1,818

Meicl------------------------------------------------------isi8

Administrative ____.__ 1,787

Troop housing and community____________-______________--.___-. 5,818

Utilities ................... 2,042

Land e.s.----------------------------------------------------- 24

----------------------------------------------------------

General authorization_ -----------____-_-__-__-__-- 1,839

Total ________----------------------------------------------------- 28,191

Mr. SHERIDAN. With respect to the out-year deficit beyond fiscal

year 1978, we will attempt to develop such a summary on an order

of magnitude basis and furnish that to the committee, also.

[The information follows:]

MILITARY DEPARTMENTS TOTAL FACILITY DEFICIENCY BEYOND FISCAL YEAR 1978

(MILITARY CONSTRUCTION) BY FACILITY CATEGORY

Facility category : Millions

Operational and training-------------------------------------- $2, 106

Maintenance/production --------------------------------------- 2, 293

Research and development-------------------------------------- 1, 354

Supply ------------------------------------ ---- 1,141

Medical -------------------------------------------------------- 244

Administrative ------------------------------------------------ 1, 538

Troop housing and community---- ------------------------------2, 945

Utilities ------------------------------------------------------ 1,213

Real estate----------------------------------------------------- 199

General authorization------------------------------------------ 1, 107

Total ---------------------------------------- 14, 140

Mr. LONG. You have already partly answered the next question.

The backlog is $23.2 billion. That is the equal of almost 10 years of

current construction.

Mr. SHERIDAN. Yes, sir.

Mr. LONG. Without counting any wear and tear between now and

then?

Mr. SHERIDAN. That is right.

Mr. LONG. How realistic is that ? Anybody can come up with figures

on backlog. My wife could come up with a fabulous backlog of items

our family needs, and I would have to trim it down.

Mr. SHERIDAN. I personally believe it is high.

Mr. LONG. Unrealistic to some extent.

Mr. SHERIDAN. It is as realistic as we can get it from the sources

where we have to obtain it, and that is in the field, the local plans. It

is then reviewed by the commands and then by the headquarters, and

then we question it.

I still think it is a little high, because you cannot take into consid-

eration realignment of bases that may be 5 or 10 years off that will

eliminate the backlog completely at one or more bases.

I would say it is the best figure we can get, but I think it is on the

high side.

REDUCTION OF BACKLOG DUE TO SALT

Mr. LONG. You mentioned 3 factors that have reduced the backlog.

One or more of these seem to be tied in with the treaty, the interim

agreement reached as a result of the SALT talks. How much did the

SALT Agreements reduce your backlog ?

Mr. SHERIDAN. It was reduced about $2 billion when the 12-site de-

ployment plan was revised. We can give you the exact amount for the

record.

Mr. LONG. It cut the backlog down about $2 billion. It was $25

billion. Has it been reduced to $23 billion ?

Mr. SHERIDAN. That is correct.

EFFECT OF BASE REALIGNMENTS ON BACKLOG

Mr. LONG. How much did these base realignments that were given

so much publicity in recent months cut your backlog ?

Mr. McCREARY. I do not have an exact figure on this. We have been

furnished figures which show in the next 5 years the put and take

between Army, Navy, and Air Force. The order of magnitude of those

is not very great in relation to the total $23.2 billion program.

Mr. LONG. So, the base realignments really did not have much effect

on your backlog?

Mr. McCREARY. Not a great deal, sir.

BASE CLOSURES

Mr. LONG. Were they real base closures?

Mr. SHERIDAN. Some were. There are some large ones.

Mr. LONG. I got the impression it was mostly a shuffling around,

moving people from here to there.

Mr. SHERIDAN. NO. There were actual closures.

Mr. LONG. I know there were. There were closures in Maryland. I

understand the major closures were in the Navy.

Mr. SHERIDAN. Those were the largest, yes. Over the past years,

the Air Force has done an excellent job of realining its base structure.

The Navy made a real push at it in this recent base realinement pro-

gram. We hope the Army will come along the same way in the next

one.

Mr. LONG. I am talking about the three services, of course. We were

lead to believe that all these base closures were real economy measures.

I had some skepticism at the time. If they were real economy measures,

why are they not cutting down on our military construction require-

ments?

Mr. SHERIDAN. They do cut down on the military construction re-

quirements, but the backlog is what we are answering.

Mr. LONG. Why do they not cut down on the backlog?

BASE CLOSURES-CONSTRUCTION AVOIDED AND REQUIRED

Mr. KERR. Mr. Chairman, as a result of these closure programs, we

avoid construction of about $272 million to fiscal year 1978, but there is

about $144 million cost associated with some of the construction at

places where we move people to. Therefore, we are coming up with not

quite a $30 million reduction from fiscal year 1973 and earlier to fiscal

year 1978.

Mr. LONG. Could I get that straight again ?

[Discussion off the record.]

Mr. LONG. You are talking about all three services?

Mr. KERR. All three services. That is construction avoided.

Mr. LoN-. You say they avoided about $272 million of construction.

On the other hand, they had to put up about $144 million

Mr. KERR. I took it all the way out, sir. We avoid about $130 million

construction for the three services from fiscal year 1973 and earlier

programs to the fiscal year 1978 program which includes our normal

5-year future Milcon projections. This, however, does not include an-

other $19 million in possible construction avoidance which the Navy

is still studying.

Mr. NICHOLAS. Could you provide that table for the record ?

Mr. KERR. Yes, sir.

Mr. LONG. As a matter of fact, I would like to have that table fairly

soon.

[The table follows:]

SUMMARY OF DEPARTMENT OF DEFENSE MILITARY CONSTRUCTION COSTS REQUIRED AND AVOIDED AS A RESULT

OF THE BASE REALINEMENT PLAN ANNOUNCED APR. 17, 1973

[In thousands of dollars

Fiscal years

Long

1973 1974 1975 1976 1977 1978 Total range

CONSTRUCTION REQUIRED

Army...................... 4, 346 6, 584 18,648 13, 166 2,388 1,795 46,927 19, 800

Navy...................... 0 45, 499 48, 298 0 0 0 93, 797 (I)

Air Force................... 2,736 0 1,050 0 0 0 3, 785 (I)

DOD total-........... 7,081 52, 083 67, 996 13, 166 2,388 1,795 144,509 19, 800

Fiscal

year

1973 Fiscal years

and Long

earlier 1974 1975 1976 1977 1978 Total range

CONSTRUCTION AVOIDED

Army-...............-.... 0 7,331 9,350 13,648 6,365 4,455 41,149 33,026

Navy-....- ......... 2 14, 573 14, 669 26, 325 36, 257 50, 720 33, 476 176,025 (1)

Air Force......-............ 1,597 0 13, 983 17, 277 14, 804 7, 375 55, 036 (1)

DOD total........--------.... 16, 175 22, 000 49, 658 67, 182 71, 889 45, 306 272, 210 33,026

Net cost avoidance.... 9,094 -30,083 -18,338 54, 016 69, 501 43, 511 127,701 13, 226

I Not available.

SConstruction has not commenced on an additional $19,317,000 which is under review for possible cancellation.

Mr. LONG. This is really startling. We were led to believe that this

was big stuff. There was tremendous publicity on the base closures.

Mr. KERR. It really is.

Mr. LONG. How can you say it is big stuff when you just told me

that so far as the construction requirements are concerned, they almost

canceled out ?

Mr. SHERIDAN. What we answered were two questions. One was on

the reduction in the backlog, and the second was what have we avoided

in the military construction in the foreseeable future?

There is a third question: How much was saved in the reduction

of maintenance and operation costs? That is where the large figure

comes, the reduction in maintenance and operation costs.

Mr. LONG. Will that be reflected in the Defense appropriation re-

quest?

Mr. SHERIDAN. Not in 1974.

Mr. LONG. This is so heartbreaking. It is so difficult to explain to

your constituents why, with the war over, we are not cutting down

on military expenditures. We have to swallow hard with all these

base closures. Everything has been wiped out in my area.

Then you find no result. First, the construction request almost

cancels out. Even over a 5-year period, savings may be very tiny.

There is supposed to be a substantial amount of operating expenses

cut out, but not for 1974. Why not ?

Mr. SHERIDAN. Because we are right in 1974 now.

Mr. LONG. Not quite.

Mr. SHERIDAN. The savings from the majority of these actions will

take place after 1974.

Mr. LONG. I would have thought there would be some effect in 1974.

Mr. SHERIDAN. There is some.

CLOSURE OF FORT HOLABIRD

Mr. LONG. It is understanding that Holabird in my district will be

largely closed down beginning in fiscal year 1974. We are told this is

because it is an expensive base to operate with a lot of antique buildings

that are almost as old as my house, which is now worth 3 times what

it was when I paid for it. That is why the Department of Defense took

its actions.

Yet we do not save anything.

Mr. SHERIDAN. I do not think Holabird was included in the recently

announced plan.

Mr. KERR. It was announced earlier and it will be closed at the end

of June this year.

Mr. LONG. By the beginning of fiscal 1974.

Mr. SHERIDAN. Isn't there some activity that will stay there?

Mr. KERR. The GSA is considering taking over portions of it.

Mr. LONG. I would like to know exactly what is happening at Hola-

bird. We cannot find out. We know the Army garrison has closed down,

but that is only the housekeeping operation. We understand some of

the Defense Intelligence Command will keep operating for a while,

with the General Services Administration performing housekeeping

functions.

Is this not still part of the Defense budget?

Mr. KERR. They are reflected in our funding.

Mr. LONG. Why can we not find out what is happening there?

Mr. KERR. There is no reason why we cannot, sir.

Mr. LONG. We are pleading with you to get the story.

Mr. RomnsoN. Would the chairman permit a question ?

Mr. LONG. Yes, sir.

Mr. ROBIsoN. As a stranger to the subcommittee and one who is

hesitant to demonstrate his ignorance on the overall subject and

being not sure to whom I ought to address the question, but some-

where along the line I presume this subcommittee and the Congress

would want some information from gentlemen such as those you nave

here as witnesses, Mr. Chairman, as to the possible eventual recovery

by the Government from the disposition of some of these properties.

Let me give you an example. I do not know whether it is a propl

example, but I happen to have visited Ramey Air Force Base in

Puerto Rico on a couple of occasions. That is extremely valuable

Property, for a whole variety of potential purposes. I have no idea,

it is probably much too soon to ask these witnesses from the Depart

ment of Defense what in the long run is going to be done with that

property. Yet it does strike me as an outsider again that somewhere

along the line there is going to be a recapture by the Government of

dollars, as some of these properties or the peripheral parts of the

properties are disposed of and moneys from these sales come back

into the Government.

That has to be included as a part of the quote savings unquote that

Mr. Long is looking for.

FUNDS RECAPTURED FROM SALE OF DEFENSE INSTALLATIONS

Mr. LONG. Along that line, I might point out that both bases pro-

posed to be shut down in my general area. Holabird and Bain-

bridge Naval Station are extremely valuable real estate. I would guess

in the case of Holabird that real estate must be worth anywhere from

$10,000 to $30,000 an acre. There are several hundred acres there. So

I do think the gentleman's question is very pertinent.

Mr. SHERIDAN. The question can only be answered, Mr. Chairman,

by the General Services Administration because, as you know, the

Defense Department does not receive any funds for the sale of prop-

erty which has been excessed. It goes into the general fund of the

Treasury. We have tried for quite a few years to get a sell and re-

place bill through the Congress. We felt that that would be strong

initiative for the departments to not only modernize their activities,

consolidate, make them more efficient, if they got the funds that

were obtained by the sale of outmoded installations, but we do not

get it. We do not get any of the money.

Mr. LONG. So the costs go into the military construction budget,

but savings go somewhere else; is that what you are saying?

Mr. SHRIDAN. Yes, sir, that is correct.

Mr. KERR. From sales, Mr. Chairman.

Mr. ROBIsON. Any recapture of the Federal investment from the

sale goes into the general Treasury account?

Mr. SHERIDAN. Yes.

Mr. LONG. In fairness to this committee and the Defense Depart-

ment, I would think we at least ought to have some figures on it

that we can give to the public.

Mr. SHERIDAN. We can furnish those.

Mr. SIKES. It would be very good to have an estimate for the current

year and maybe for the last 2 years to give us a comparison, some

explanation of just what is happening.

[The information follows:]

Most of the money recaptured in the sale of DOD installations goes into the

land and water conservation fund of the U.S. Treasury. General Services Admin-

istration disbursement is set forth in title 41, chapter 101, section 47.307-6 of

the Code of Federal Regulations which states: "All proceeds (except so much

thereof as may be otherwise obligated, credited, or paid under authority of

those provisions of law set forth in section 204(b)-(e) of the act (40 U.S.C.

485(b)-(e), or the Independent Offices Appropriation Act, 1963 (76 Stat. 725)

or in any later appropriation act) hereafter received from sale, lease, or other

disposition of surplus real property and related personal property shall be cov-

ered into the land and water conservation fund in the Treasury of the United

States." An estimate of funds received from such sales for the current year is not

available; however, $71.3 million was received in fiscal year 1970, $18.9 million

in fiscal year 1971, and $7.2 million in fiscal year 1972.

SAFEGUARD AND SITE DEFENSE

Mr. LONG. What is the out year projection for Safeguard and site

defense?

Mr. SHERIDAN. NO additional military construction funding for

either Safeguard or site defense is contained in the out years estimate

of construction requirements. Currently available prior year appro-

priations are considered adequate to complete the Safeguard facilities

now authorized.

And with respect to site defense, approximately $20.4 million was

appropriated in 1973 fiscal year for the design and construction of

prototype site defense facilities. And that should be adequate to com-

plete the facilities at Kwajalein.

No further construction funds for deployment are programed in

the out years.

SUMMARY OF NET ANNUAL BY FISCAL YEAR AS A RESULT OF BASE CLOSURES

Mr. LONG. Going back to our previous discussion of base closures, I

wonder if you could, Mr. Secretary, put in the record the savings,

counting the savings in cost of operations as a result of the base

closure.

Mr. SHERIDAN. Yes, sir.

Mr. LoNG. Both fiscal 1974 and then if you want to, the next 5 years.

Mr. SHERIDAN. Yes, sir. We have those figures.

[The information follows:]

DOD base realinement announcement of April 17, 1973, net annual savings

Fiscal year : Millions

1973 ----------------------------------------------------- ($15.1)

1974 ------------------------------------------(3---------- (3.8)

1975 -------------------------------------------------------- 224.7

1976 -------------------------------------------------------- 361.4

1977 --------------------------------------------------------375.0

1978 and future---- ------------------------------------------375.0

( ) Indicates costs.

[Additional information appears on page 859, in the appendix to

this volume.]

Mr. LONG. There should be a net savings, right ?

Mr. SHERIDAN. Yes, sir.

Mr. LONG. Also, if you would put in what the impact on the military

construction budget is, even if it is a small impact. I think we should

have in there what the cost to military construction budget is and

what the savings are.

Mr. SHERIDAN. Yes, sir.

Mr. LONG. Because I have felt for some time that many of these base

realinements are not savings at all, but are merely movements to some-

where else where new buildings have to be built to house people

tossed out of old buildings which still had some life in them. Give us

the figure on that.

Mr. SHERIDAN. Yes, sir. [See page 552.]

TRIDENT LONG-RANGE CONSTRUCTION COST

Mr. LONG. What is the current estimate for the long-range construc-

tion cost attributable to the Trident program ?

Mr. SHERIDAN. The total estimate for design and construction of

trident facilities is $543 million.

Mr. LONG. For the long run?

Mr. SHERIDAN. That is right. That is considerably lower than the $1

billion estimate that we gave you last year.

Mr. LONG. That does strike me as low, especially since the single

Trident is supposed to cost over $1 billion. How has that total cost been

reduced?

Mr. SHERIDAN. It is a result of a reevaluation of the facilities re-

quirements which indicated the depot level maintenance should be per-

formed by our existing shipyards, some functions which had been

planned to be accomplished by military personnel could be done by

civilian personnel, and we hope to be able to reduce the estimated land

requirement at the Bangor site.

Mr. LONG. So this is being done by contracting out basically ?

Mr. SHERIDAN. Yes, by putting work into the existing Navy ship-

yards, rather than building up the facilities at Bangor.

Mr. LONG. Are there other costs associated with Trident such as fam-

ily housing or medical support which may be picked up in other areas

of the military construction or family housing program ?

Mr. SHERIDAN. We estimate that 1,400 to 1,600 military families will

require housing which will be included under the family housing

title. The cost and number of units of this requirement to be funded

from military construction is contingent upon the growth of com-

munity support housing and upon FHA's determination of whether

they will provide mortgage insurance. Medical support facilities are

projected and included in the current estimate for Trident facilities

at Bangor. The size and cost is subject to a more detailed evaluation

of the medical facility requirements and the assessment of the avail-

able facilities at the site.

Mr. LONG. Do you have an estimate of these costs ?

Mr. SHERIDAN. Not right now.

Mr. LONG. Going back to that question on the current estimate for

long-range construction cost, is the long-range construction cost at-

tributable to building just 1 or 2 Tridents or the full employment of 10

or up to 30 that they are thinking of ?

I gather this is assuming that the Trident program is for the time

being going to be a modest program ?

Mr. SHERIDAN. Yes, sir.

Mr. LONG. Half a billion dollars?

Mr. SHERIDAN. On one coast, the west coast.

Mr. LONG. One place ?

Mr. SHERIDAN. Just one place.

Mr. LONG. If we ever go ahead with the full Trident program, these

construction costs could be enormously greater ?

Mr. SHERIDAN. Yes, sir.

Mr. SIKES. You would only have a one-time dredging cost at Patrick,

for instance, would you not ?

Mr. SHERIDAN. We have included that in our cost, that would be a

one-time operation. There undoubtedly would be some maintenance

dredging, but that would be further down the road.

Mr. SIKES. As I understood the answer, a full-scale Trident program

is going to cost a lot more money; is that the true situation ?

I would assume that you have certain basic requirements for con-

struction, dredging, or for instance docks, which, once constructed,

are useful for one or a dozen Tridents.

Mr. SHERIDAN. Oh, the number of boats, yes, that is correct; yes, sir.

Let me check that.

Mr. SIKES. All right. We want to be sure the record is clear on this,

that the cost of construction itself is not necessarily increased in pro-

portion to the number of Tridents.

Mr. LONG. If you build a lot of them, you could not locate them all

in the same spot, could you? If you were building two, three, or four

at once, then your construction costs would go way up.

Mr. SHERIDAN. I did not want to give the impression that our an-

ticipated cost estimates at Bangor were going to go up. But if other

facilities were built elsewhere, there would be an increase.

Mr. MCCREARY. The program for Trident is based on a 10-boat pro-

gram. The facilities at Patrick are based on the R. & D. approach.

Mr. SIKES. For the entire program?

Mr. McCREARY. For the entire program; yes, sir.

Mr. SIKES. That clears it up.

EFFECT OF SALT ON NAVY CONSTRUCTION NEEDS

Mr. LONG. AS a result of the SALT agreements, the total number

of submarine-launched ballistic missiles and the number of ballistic

missile submarines was limited. Does the Navy's long-range program

reflect reductions as a result of this ?

Mr. SHERIDAN. Yes, sir. We are in compliance with the interim

SALT agreement now, since Trident is not introduced during the

period of that agreement.

The Trident weapons system has been an element of our long-range

strategic program and our planning has taken into consideration possi-

ble follow-on submarine-launched ballistic missile limitations.

Our current program makes maximum use of existing facilities,

focuses on Trident's peculiar requirements as much as possible and in

no way commits us at this time to construction of facilities that would

not be required in the post-1977 Trident environment.

SATELLITE BASING PROGRAM

Mr. LONG. Last year this committee went into considerable detail on

the Air Force's proposed long-range satellite basing plans. Can you

tell us the status of that program or provide details for the record on

the current and projected construction programed in this area?

Mr. SHERIDAN. Sixteen of the projected 20 satellite bases in phase I

are currently operational. The balance of the facilities in phase I are

under construction. At the moment there are no plans to proceed

beyond phase I as the requirement for additional satellite basing is

currently under review within the Department of Defense. And I think

when you get to the Air Force title of the bill, they can give you much

more detailed answers.

RELIANCE ON COMMUNITY SUPPORT FOR BACHELORS

Mr. LONG. To what extent does the policy of the Department of

Defense rely on off-base housing for bachelor personnel, where it is

available and where these personnel are not required to live on base

for military reasons, in lieu of constructing new bachelor housing

facilities on base?

Mr. FLIAKAS. Mr. Chairman, except where military necessity re-

quires that bachelor personnel live on base, the DOD policy is to liber-

alize our criteria and to permit more off-base housing of bachelor

officers as well as some enlisted men. Generally the policy is that pay

grades 0-4 through 0-10, for example, are permitted voluntary oc-

cupancy of Government quarters or they can have the option of

living off base. Bachelor officers and enlisted personnel in grades 0-1

through 0-3 and E-5 through E-9 are given the option of living off

base if only inadequate quarters are available on base.

Bachelor enlisted personnel in the lower grades, E-1 through E-4

must live on base if adequate quarters are available. However, it is the

prerogative of the commander to permit off-base living for bachelors

if military necessity does not require it.

Mr. LONG. If you encourage greater reliance on off-base support,

would it reduce the bachelor housing deficit substantially?

Mr. FLIAKAS. Not very substantially, Mr. Chairman, because mili-

tary necessity for effective training and operations does require a pre-

ponderance of the lower grades to be on base. Also for supervision

and disciplinary purposes, some of the higher grades also. So this

is taken into consideration in our projected requirements.

Mr. LONG. Has off-base support for bachelor personnel increased

with higher pay ?

Mr. FLIAKAS. Yes. Except that the senior personnel who have the

option of living off base are already doing so. I would not say that it

has had a significant impact since most of the larger pay raises, have

been in the lower grades.

The majority of the lower grades still live on base. We have found

this to be true in many of our visits, however two or three bachelors

will get together and rent a house in town, subject to the commander's

permission. In some cases, for example, they compete with families

for those houses.

Mr. LONG. Also for maid service?

Mr. FLIAKAS. Yes.

CHAMPUS VERSUS NEW HOSPITAL CONSTRUCTION

Mr. LONG. To what extent does the Department of Defense intend

to rely on the CHAMPUS program versus the construction of new

hospital facilities ?

Mr. SHERIDAN. We have a representative of the Assistant Secretary

for Health and Environment here, Mr. McKenzie.

Mr. McKENZIE. Mr. Chairman, the CHAMPUS program was de-

signed primarily to provide care for the dependents of active duty

members who did not have access to military facilities. Since then, it

is true it has been expanded to include retired members and their

dependents. But the last time we did a cost comparison on the cost of

providing care in our facilities for our beneficiaries versus the cost of

buying or purchasing this care in civilian facilities, we found that

there was a distinct advantage from a cost standpoint in providing

care in our own facilities. So we do not envision or view the

CHAMPUS program as being a substitute for providing care or a way

of reducing the provision of care in our facilities, but rather as a means

of providing care primarily for those who do not have access to our

facilities.

Mr. SIKES. Let's spell that out in use terms.

There has been quite an increase in the use of CHAMPUS since the

program was developed. Is all of this due to the unavailability of

military medical facilities or personnel on base, or is some of it also

based upon convenience?

Mr. McKENZIE. The primary reason, of course, for the increased

costs under the CHAMPUS program is simply the inflationary trends

in health care costs, as in other portions of our economy.

Mr. SIKES. Has there not been an increase also in the number of

participants ?

Mr. McKENZIE. Yes; there has been a distinct increase in the number

of participants.

Mr. SIKES. So you have both factors ?

Mr. MCKENZIE. Yes, sir, particularly as retired members and their

dependents are concerned.

Mr. SIKES. Back to my question: Is the increase due largely to the

lack of medical facilities on base or is it due to the fact that it may be

more convenient for them to obtain medical care elsewhere?

Mr. McKENZIE. Mr. Chairman, I think both of those considerations

do enter into the increased CHAMPUS costs.

Mr. SIKES. Do they have a choice ? Do they first have to seek medical

care on base?

Mr. McKENZIE. Under the terms of the CHAMPUS legislation, the

only restrictions that can be imposed as between choosing care on the

base and choosing care downtown relate to those active duty u pend-

ents who reside with their sponsors. That is related again only to in-

patient hospital care. For all other categories of beneficiaries under

the CHAMPUS and for all types of outpatient care, the beneficiaries

have a free choice.

Mr. SIKES. Then we can anticipate that there will be a continuing

increase in the cost and size of the CHAMPUS program, can we notl

Mr. McKENZIE. Yes, sir.

Mr. SIKES. Does that mean that we may be overbuilding hospitals

in some areas?

HOSPITAL PROGRAMING LIMITS FOR RETIRED PERSONNEL

Mr. MCKENZIE. No, sir; it does not. We do have restrictions, for

example, on the amount of space that we can program in new hospital

construction for retired members and their dependents.

You may recall for several years we programed no such space. Then

in the 1966 amendments to the CHAMPUS law, we were authorized

to program for certain limited purposes. Roughly, what it amounts to

now is that we may not, in a regular military hospital, program an

amount for retired members and their dependents in excess of 5 percent

of what we are otherwise programing; in teaching hospitals such as

Walter Reed and Bethesda, the amount is 10 percent.

There is also provision in the law under which we can program space

for these groups in areas where there is an inadequate number of

hospital beds in the private sector. But since 1966, when that provi-

sion of law was enacted, we have not had a program where that

particular concept operated.

Mr. SIXEs. Thank you.

Mr. LONG. The issue of hospital facilities for retired people intrigues

me. I assume that we are not supposed to build new hospitals for

retired people, but once the hospital facilities are constructed, retirees

are allowed to use them on a space available basis, right?

Mr. McKENZIE. Yes, sir.

Mr. LONG. Do you have any estimates of what percentage of the

use is by retired people ?

Mr. MCKENZIE. Yes, sir, I do have.

For fiscal year 1972, on an average day, 4,840 beds were occupied in

military hospitals by retired members and their dependents.

Mr. LONG. What percentage is that of the beds?

Mr. MCKENZIE. That would have been slightly less than 10 per-

cent.

Mr. LONG. Of the total beds or of the beds occupied ?

Mr. McKENZIE. Of the beds occupied.

Mr. LONG. Ten percent ?

Mr. McKENZIE. Slightly less, yes, sir.

Mr. LONG. Do you have a variation, as to how that varies in certain

places?

Mr. McKENZIE. Yes, sir. There are tremendous variations. Of course

in some unpopular areas there would not be any retired families.

Mr. LONG. What is it, for example, at West Point?

Mr. McKENZIE. May I provide that data for the record, sir, I do not

have it with me.

[The information follows:]

For fiscal year 1972, on an average day, 14 beds were occupied in the West

Point hospital by retired members and their dependents. This was 27 percent of

the total beds occupied for that facility.

Mr. LONG. I would be very much interested in that. Did your cost

analysis of CHAMPUTS versus in-house care take into account the

investment costs of the accelerated medical facilities modernization

program ?

Mr. McKENZIE. No, sir, because the cost comparison that I referred

to was done several years ago.

We are now planning to do a new cost comparison and we will take

that into account.

EFFECT OF REGIONALIZATION ON MEDICAL FACILITIES REQUIREMENTS

, Mr. LONG. To what extent should interservice use of existing and

proposed facilities reduce the amounts required?

Mr. MCKENZIE. We are hopeful that under our new regionaliza-

tion concept that was discussed earlier this morning, significant reduc-

tions can be made. In one of the four test areas that was referred

to this morning, we found we can close a complete hospital under the

new approach and provide care for those who have been getting it

there at adjacent hospitals of another service.

Mr. LONG. Can you give us some idea of how much a reduction

that would involve, for the record ?

[The information follows:]

As a result of medical regionalization in the San Antonio, Tex. area, the hos-

pital at Randolph Air Force Base will be reduced to a dispensary effective July 1,

1973.

A projected annual dollar savings of $320,657 is expected with a manpower

reduction of 26 spaces (13 military and 13 civilian).

EFFECT OF FORCE REDUCTIONS ON CONSTRUCTION P.EQUIREMENTS

Mr. LONG. With the war winding down and increased pressure on

military spending, you are reducing the baseline forces well below

that proposed in earlier years.

For example, several years ago the total overall strength was pro-

jected at 2.5 million men, with 925,000 in the Army; now you are pro-

jecting a fiscal year 1974 end strength of 2,233,000 with 804,000 in

the Army.

Has the long-range program been modified to meet these strength

deductions ?

Mr. SHERIDAN. The military departments have assured us that they

have adjusted their long-range programs to reflect the reductions in

strength. However, as the committee recognizes, there are always

ongoing studies and refinements which occur in the assignments of

forces and personnel to the base structure. So in reality this is a

never-ending process. It is being taken into consideration and con-

stantly adjusted and readjusted.

Mr. LONG. It does not seem to result though in very much less

military construction request.

Mr. SHERIDAN. Well, the effect would be that we would catch up

on that backlog a lot faster.

Mr. LONG. Will you give us a figure as to just how much you are

going to be able to reduce your backlog as a result of this? In other

words, now that you are constructing for a smaller defense establish-

ment and a smaller Army, and are able therefore to divert some of

your :truction to catching up your backlog, how much will this

reduce your backlog?

Mr. SHERIDAN. We will try to furnish the figures.

Mr. LONG. Can you give us figures on that? A lot of people are

going to be intensely interested in this, an awful lot of them. You just

cannot explain to the people back home why we need a bigger military

construction for a peacetime military with a much smaller, much

smaller military.

Mr. SHERIDAN. I can understand your problem. I have it in my own

family, trying to explain it. I guess you do, too.

Mr. SIES. Yes. I would like to match explanations with you.

[The information follows:]

The backlog of facility deficiencies testified to previously ($23.1 billion), com-

pares to the backlog computed last year of $26.5 billion. The current total reflects

substantial reductions attributable in the main to reduced estimates of facility

needs for the Safeguard and Trident weapon systems. The revision of the Safe-

guard system from a 12-site deployment to the current one site, now virtually

complete, resulted in a reduction of $1.7 billion. Similarly, Navy has trimmed

some $500 million from estimated Trident costs and an additional $1.2 billion in

shore station requirements which they believe are no longer valid. We understand

Navy is continuing to study their backlog and further reductions may be forth-

coming shortly.

It is probable that further reductions in the total backlog may be made in the

next fiscal year as the military services reexamine their current listings against

the reduced force levels and base realinements which have already occurred or

which may be indicated for the future. Since fiscal year 1968 the total military

force has dropped some 1,239,000 spaces with an additional 55,000 spaces sched-

uled for reduction in fiscal year 1974. Within this environment and considering the

ongoing base requirements studies of all the services, it is reasonable to antici-

pate some future reductions, although it is not possible to forecast such reductions

until future firm decisions in these areas become available.

Mr. LONG. There has been a base closure package announced, and

prior to that the Army reorganization plan was announced, which

also achieved some reductions. Most of these actions are to be achieved

in 18 months or less.

CLOSURE ACTIONS UNDER STUDY FOR SOME TIME

The closures have been pending for a long time. Is that right ?

Mr. SHERIDAN. Yes, sir. The actions were under study for some time,

particularly the Navy actions. They undertook their studies on the

shore establishment realinement plan 2 years ago.

Mr. LONG. Longer ago than that, did they not ?

Mr. SHERIDAN. Not on as concerted and intensified a manner in which

they did it on this present one.

FUTURE REALINEMENT ACTIONS

Mr. LONG. In the event further force reductions are planned for

beyond the end of fiscal 1974, will there likely be further reductions in

installations to coincide with them ?

Mr. SHERIDAN. Well, if there are force reductions of a significant size,

we would of necessity reevaluate our whole base posture, and that

would ultimately lead, perhaps, to more base realinements.

Mr. LONG. I note that although training workloads have dropped

substantially, the number of training bases has not been reduced in the

same ratio. How do you explain this ?

Mr. SHERIDAN. Well, the proportion of training installation reduc-

tions may not equate to the strength reductions, but we have reduced

the DOD training establishment significantly. The recently announced

closure of Hunter Army Airfield in Georgia and Fort Wolters, Tex.,

will reduce the Army aviation training structure. The closure of the

Naval Training Center at Bainbridge and Naval Air Station at Glynco

will also reduce the Navy's training structure, and the closure of

Laredo Air Force Base will reduce the Air Force's.

The Army has closed the Army Training Centers at Fort Camp-

bell, Ky., and Fort Lewis, Wash., and is now studying further reduc-

50

tion in its basic training structure as was indicated in the Secretary of

Defense's April 17, 1973, statement on the base realinement plan.

Mr. LONG. I would appreciate it, since the Bainbridge Naval Station

has always been a matter of interest to me. I think it will still be a

matter of interest to me when I retire from Congress say 20, 30 years

from now, just how much this reduction applies to Bainbridge.

Could you put that in the record ?

[The information follows:]

The savings to the naval training structure alone will be a reduction of 207

military and 298 civilian positions and save over $5.5 million annually. In addi.

tion, the training structure will reduce its inventory of real property by $48

million (acquisition cost) and 1,109 acres.

TRAINING INSTALLATIONS WORKLOAD

Mr. SIKES. You are just starting on your second 20-year term.

Mr. LONG. Provide for the record the information on the workloads

for training which were included in the Defense Subcommittee's rec-

ord, and show the number and capacity of the bases associated with

each which have been closed and are being retained.

Mr. SHERIDAN. Yes, sir.

[The information follows:]

Following by service is the information requested on the training loads and

capabilities of the individual installations:

ARMY

President's budget, 1974

workloads for training

Capacity for

Base training 1973 1974

Fort Dix----------------.................................................---

Fort Knox.........------------------...............................-----

Fort Jackson -..------- --........... ............. ... . ..

Fort Gordon ..-..........-..-........- -. ............... .

Fort McClellan--- ................

Fort Campbell ---.......... ...... . . . . .

Fort Sill- - .....-..-... .. . . ......-.... . . . . . . . . . . .

Fort Bliss ....................---........ .

Fort Sam Houston--- ................. .. .. ..

Fort Polk-...---...................

Fort Leonard Wood----............ . .. .. . .. . .. . .. . .. .

Fort Ord..........

Fort Lewis ....

Fort Benning ..-.......... . . . .

Fort Belvoir ...............

Fort Huachuca..............

Fort Ben Harrison

Fort Hamilton

Fort McNair ...

Aberdeen Proving Grounds-- ...

Fort Lee......

Fort Bragg .......-................. - -- - ---- --- ;;

Fort Eustis....... . . . . . . . .

Fort Leavenworth

Fort Rucker

Fort Wolters 1

Fort Monmouth

West Point

JAG School, Charlottesville

Red Stone Arsenal

Rock Island

Carlisle Barracks

Hunter Army Airfield I ..

Defense Language Institute..._

Total...............................

25,500 10,500

25,000 12,401

22,600 12,650

7,900 8,583

4,500 2,586

0 0

13,000 5,092

15,800 3,609

11,300 6,007

28,400 14,100

28,000 12,200

24,100 12,600

0 0

30,600 4,918

8,300 2,480

4,500 1,422

2,900 2,855

1,000 204

300 272

8,700 2,863

10, 800 3,781

25,200 703

9,700 1,509

800 975

11,400 1,596

3,300 470

4,300 2,590

5,200 3,958

0 84

2,500 1,960

0 13

200 188

2,300 39

0 3,126

'338,100 136,334

To be placed in caretaker status by end fiscal year 1974.

2 Includes 129,000 spaces in permanent housing.

9,400

11,282

11,400

8,256

2,451

0

4,533

2,967

5,546

12,700

11,000

11,300

0

4,372

2,033

1,29

1,135

212

2, 769

3,008

586

1,334

932

1,593

462

181

23

2,661

123,262

51

NAVY-LOADS AND CAPACITIES SPECIFIED TRAINING INSTALLATIONS

Training activity

Recruit training:

Average on board.......................... ......................

Capacity1--------...................................-----------------------------------------............................

Service schools:

Average on board...................... . .............

Capacity 2..................................... ..................... .

Technical training:

Average on board............................ ............................

Capacity a ....................................................... .........

Professional training:

Average on board..........................................................

Capacity 4....................................................... .........

Officer training:

Average on board...........................................................

Capacity . -------..-.........--------..........

Aviation training:

Average on board............................. ......................

Capacity -................--.....................-....--------------------

Medical training:

Average on board

Total training load.......................................................

Total capacity ............. ...........................................

Fiscal year

1973 1974

19,383 18, 994

27, 000 27, 000

11,855 13,586

14,325 14,325

18,638 25,131

27,455 25,131

6,973 6,944

7,260 7,260

1,013 1,471

2,410 1,471

2,716 3,483

2,716 2,978

2, 397 2,423

2,983 2,793

62,975 72,032

84,059 80,958

1 Capacity for recruit training is based on 3 naval recruit training commands located within the 3 naval training centers.

Closure of any 1 of the 3 would result in insufficient capacity to handle the average on board (AOB)' load for any given

fiscal year; consequently, the capacity depicted must be greater than the load. In fiscal year 1974 the load will commence

an increase due to the assumption of reserve recruit training which was previously conducted by separate reserve training

centers.

a The same rationale as I above holds true since service schools are co-located with the recruit training at the 3 Navy

training centers. Service School Command, Bainbridge is being closed with the load assumed by the Service School Com-

mand, NTC Orlando as part of existing long-range plan to close Service School Command, Bainbridge, Md.

a A total of 8 technical training facilities are being closed. Capacity, however, will be keeping pace with (AOB) as approved

new construction, that is, EW School, Corry Field, Fla. and Nuclear Power School, Orlando, Fla. comes on line to accom-

modate the Navy's greater need for technical training in the All Volunteer Force (AVF) environment.

4 There are no activities planned for closure action in the professional training arena, consequently the capacity will

remain relatively stable to accommodate the projected AOB, based on total Navy training requirements.

a There are no activities planned for closure action in the officer training arena. Rationale identical to 4 above.

e Although the capacity for aviation training is keyed primarily to aircraft availability, facilities must of necessity be

kept open to accommodate the aircraft inventory to provide sufficient support, airspace, et cetera, consequently only 1

facility is being closed.

7 The present figures reflect the closing of 1 medical facility at which medical training formerly was conducted for a

maximum of 30 students. Capacity has been reduced over the past 3 fiscal years to aline closer to the projected load (AOB).

No attempt has been made to change the capacity figures because of the small percentage of the total involved and because

of some limited flexibility in the capacities of the remaining facilities.

LIST OF NAVY TRAINING ACTIVITIES CLOSING

Recruit training: None.

Service schools: Service School Command, Bainbridge, Md.

Technical training: Fleet Training Center, Newport, R.I., Fleet Training Cen-

ter, Long Beach, Calif., Naval Aviation Technical Training Center, Jacksonville,

Fla., Naval Aviation Technical Training Center, Glynco, Ga., Fleet Sonar School,

Key West, Fla., Underwater Swimmers School, Key West, Fla., Nuclear Power

School, Bainbridge, Md., Nuclear Power School, Mare Island, Calif.

Professional training : None.

Officer training : None.

Aviation training : Naval Air Station, Glynco, Ga.

Medical training: Naval Hospital, St. Albans, N.Y.

It should be noted that a straightline reduction of capacity in the same ratio

as workload reduction is not feasible, since a basic capacity must be retained

regardless of the number of students in order to provide necessary functional

training.

52

AIR FORCE, UNDERGRADUATE PILOT TRAINING (UPT) PROGRAM

Training loads fiscal year

Base Capacity 1973 1974

Randolph............... .......................................................................

Laredo.........-----....-----....--...----............................................ ----------------------------------------------- 438 98

Laughlin----..---...----....------...................................... 432 480 411

Reese .............-------------.........------------------------------------ 430 444 430

Columbus ................---------------------------------------------- 430 411 428

Craig--....------------------------------------------................................................ 342 360 347

Moody..................------------------------------------------------- 398 407 404

Vance...............------------------------------------------------- 443 432 437

Webb...-------..----.......................................... ------------------------------------- 407 409 380

Williams--------...----....-------------------------------------....................................... 546 568 542

Sheppard........----------------------------------------------------------- 221 221

Keesler ....... ..------------------------------------------------------------- 82 0

Total--..--..-------........................................ ---------------------------------3, 428 4, 252 3, 698

I Capacity computations are based on capacity which can be accommodated by the T-37 and T-38 aircraft, while loads

computed are based on total load at each base, including academic pre-flight.

2 Base closure, early fiscal year 1974.

UNDERGRADUATE NAVIGATOR TRAINING (UNT) PROGRAM, MATHER AIR FORCE BASE, CALIF.

Training load fiscal year

Aircraft Capacity 1 1973 1974

T-29C-------.....-----.................................---------------------------------........... 1,017...........................

T-29C/T-43A ............................................. 952 ...............................

Total ... -------------------------------------------- 1,969 1,076 972

1 92 percent of maximum.

o The mixel T-29C/T-43A capacity of 952 represents the introduction of the new Undergraduate Navigator Training

System (UNTS). Tne first class will enter the UN rS program in March 1974. UNTS will be fully implemented in Octobe r

1974 (fiscla year 1975)

AIR FORCE TRAINING CENTERS

Training load fiscal years

Centers Capacity 1 1973 1974

Chanute..---------------------------------------------- 6,082 6,276 5,755

Keesler---------------------------------------------- 9,162 9,304 8,530

Lowry--- -------------------------------------------- 5,304 5,939 5,445

Sheppard...--------------------------------------------- 8,309 8,319 7,627

Lackland ....---- ---------------------------------------- 22, 588 16,848 13,798

Total......................... ---------------------------------------- 51, 445 46, 686 41,155

1 Capacities reflect adequate and substandard spaces currently in the inventory and approved for construction through

fiscal year 1973. All new construction is replacement projects for substandard dormitories now in use and will not increase

dormitory spaces available for students.

2 Loads include active duty, Air Force Reserves, Army, Navy, other Government agency, Air rorce civilians, and foreign

students. These loads also include officer and civilian students who may be housed off base. When airman on-bass h3asing

requirements exceed the stated dormitory capacity, additional students are assigned to existing dormitories on a tem-

porary basis.

ARMY RESTUDYING ITS BASE UTILIZATION

Mr. LONG. The Army has indicated that its fiscal year 1974 request

includes some projects at weak bases, but that they will not know which

until they have completed a study of their small single-mission posts.

They also have indicated that the bulk of their effort went into the

study of their reorganization plan, rather than into eliminating excess

installations.

When can we expect further closures of Army bases ?

Mr. SHERIDAN. I have no way of forecasting. We will continue, the

Army will continue to reevaluate their basic structure in their smaller

installations and quite a bit will depend, of course, on the actions of

the Congress on the 1974 budget and future defense budget reviews

and actions.

Mr. NICHIOLAS. I think the point of this question is to show that re-

gardless of future acts of the Congress, there are certain base closures

which are in a kind of suspension.

For instance, the Army is studying and will complete by the end of

this calendar year a study of the utilization of their small installations.

They are making a study of the use of Fort Dix and the use of train-

ing installations which will perhaps affect other installations if it is

decided to backfill at Fort Dix.

These studies will be completed, I believe, this summer and at the end

of this calendar year. This might result in some realinement actions. In

fact, it is anticipated that they will.

Mr. SHERIDAN. That would be a matter for review later on this year,

after the studies have been completed and reviewed.

UTILIZATION OF FORT HOLABIRD

Mr. LONG. I would also be interested in the question which Mr.

Nicholas posed: To what extent is Fort Holabird still under study?

I gather that there is still a study going on because we cannot get a

firm decision out of the Defense Department on exactly what is going

to happen to some of the activities that are still there.

Mr. SHERIDAN. We promised earlier on a similar question to provide

an answer for the record. We will incorporate that in there. I cannot

answer it right now.

Mr. LONG. When do you think you can give us an answer, Mr.

Sheridan?

Mr. KERR. I think perhaps, sir, we can give you a partial answer

now.

Fort Holabird has been declared excess to the General Services

Administration. The arrangements are being negotiated with them

now for DIS to remain there as a tenant of GSA; but we can supply

you with a separate little fact sheet on this if you like, and also insert

it in the record.

Mr. LONG. You see, that is not really an answer. It is really sort of

shifting the suspense a little.

Mr. KERR. Perhaps I misunderstood your question.

Mr. LONG. If DIS is continuing on there and nobody can tell me when

it may leave, if it is operating under different housekeeping arrange-

ments, we are still left with the question of what is going to happen

to Fort Holabird. People ask me that question every day in the week.

Mr. KERR. The General Services Administration will, of course,

make an adjudication as to what portions they can dispose of or put to

other Federal use. The only Federal installation is that portion occu-

pied by DIS.

Mr. SHERIDAN. We can give you a clear-cut answer on defense plans,

but as Mr. Kerr pointed out, GSA is going to determine what the best

use of the Holabird reservation is. I do not know.

Mr. LONG. I understand that. But the point is, we have not gotten

out of the Defense Department what their plans are. DIS is part of it.

I believe the intelligence command is still up in the air. I believe there

are a number of small operations here and there that are still up in

the air.

Mr. KERR. I believe except for DIS, which we will keep there, now

there may be something else-I understand the commands are leaving.

GSA I think is going to negotiate a sale of the balance of the prop-

erty, sir. We are going to occupy building 320 or 321, something like

that, for DIS. The rest of the property I believe, I cannot speak for

them, but I think they are negotiating a sale.

Mr. LONG. You are going to occupy one of the buildings. That does

to some extent represent a military occupancy.

Mr. KERR. Much like we are tenants of GSA in other parts of the

country, yes, sir.

Mr. SHERIDAN. We will give you a clear-cut answer of our own

plans. I do not know what they are right now, but we will get you an

answer within a week.

Mr. LONG. This is most exasperating.

We have had many answers, but we have never had an answer to this.

Mr. SHERIDAN. On what defense plans are for occupancy at Hola-

bird ?

STRATEGIC AIR COMMAND FORCE LEVELS

Mr. LONG. Provide for the record information on projected SAC

force levels and SAC base utilization.

[The information follows:]

STRATEGIC AIR COMMAND FORCES

The Strategic Air Command (SAC) includes B-52 and FB-111 bombers and

KC-135 air refueling tankers, as well as the Titan and Minuteman missiles. In

the current fiscal year (fiscal year 1973), there are 26 squadrons with 397 B-52

aircraft assigned to 23 air bases in the United States and its territories. This

force represents the optimum use of these bases for the SAC B-52 force. By early

fiscal year 1975, this force will decrease to 23 squadrons with 352 B-52 aircraft

at 21 air bases. This reduction of the B-52 bases takes into account McCoy and

Westover Air Force Bases which were announced for closure on April 17. 1973.

The FB-111 force consists of four squadrons with 66 aircraft at two air bases.

No change in this force is contemplated.

The KC-135 tanker force consists of 38 squadrons with 615 aircraft and 30

air bases, some of which are the same B-52 bases as indicated above, since

bombers and tankers are located on our base. While some redistribution of tanker

squadrons will take place due to the closure of McCoy and Westover Air Force

Bases, no change in the total force of tankers is contemplated.'

In addition, no change is contemplated in the SAC missile force.

CRITERIA FOR BASE UTILIZATION

Mr. LoNG. Would you provide for the record the criteria developed

by the three services with regard to base utilization ?

Mr. SHERIDA.\N. Yes, Mr. Chairman.

[The information follows:]

ARMY CRITERIA FOR BASE REALINEMENT ACTIONS Ti

i. PURPOSE ''I

The purpose of this document is to present the criteria and major considera-

tions used within the Army to determine which bases and activities should be

consolidated, reduced, realined, or closed.

55

2. BACKGROUND

(a) Army missions involve the accomplishment of a wide variety of functions

requiring both general and specialized accommodations. The base structure varies

from administrative office space to production/rebuild plants; from troop bases

with tens of thousands of acres to small complexes in urban areas. As missions

and the size of the Army vary, so do the requirements for bases and facilities.

(b) The Army continually reviews its missions, strength and structure and,

concomitantly, the base structure requirement to insure that it is in proper

balance. Some requirements are relatively fixed because they support more stable

missions such as military schools, research and development activities, materiel

testing, and specialized depot activities. These bases may experience variations

in workload; however, the need for the bases, and their physical plants, is a

continuing requirement. On the other hand, some Army missions are subject to

large variations and may either generate additional requirements or reduce

requirements for bases. Examples are training centers for basic and advanced

individual training, aviation training facilities, production facilities, administra-

tive space to support specialized activities, and troop unit bases.

(c) The Army also reviews it missions to determine where and in what man-

ner it can consolidate, realine, and reduce resource requirements and still oper-

ate efficiently. This review may or may not result in a change in the base

structure.

(4) Inherent in these analyses is consideration of the following criteria (not

rank-ordered) :

Mission requirements; Budget/manpower constraints; Cost savings; Per-

sonnel turbulence; Civilian labor market; Facilities/housing availability;

Capital investment (sunk cost) ; Geographical location; Land area; Impacts

on other services/agencies; Community impact; Environmental impact;

Reserve components support; Mobilization and contingency requirements;

Encroachment; and Long range plans.

(e) The Army does not wish to convey that the analyses will produce clear-

cut advantages for proposed realinements vis-a-vis related alternatives. This is

not always the case. Decisions are often charged with great emotionalism for the

decisionmakers, the public, and Congress. There are formidable realities that

must be confronted. Some examples follow:

(1) Investment in Facilities. The decisionmaking criteria often work at cross-

purposes to one another. On the one hand, the Army is short of permanent

facilities in every construction category; and, if a base is to be closed, it usually

means "walking away from" some permanent facilities. On the other hand, if

the missions performed at that post can be performed satisfactorily by consoli-

dating them with missions at other posts, then substantial overhead savings could

generally be realized.

(2) One-time Realinement Cost. A factor complicating the execution of realine-

ment actions, regardless of the long range savings associated with the actions,

is their one-time costs. These costs must be amortized within a reasonable period

of time.

(3) Emergency Expansion. The Army often finds itself in a crossfire with

respect to base management and pressing facilities requirements. In some cases,

the urgency of the moment forces the Army to adopt courses of action which run

counter to the long range-peacetime-objectives. For example, during the

Vietnam war the Army expended funds on aviation facilities at a number of bases,

all of which will not be required by a peacetime Army.

3. Mission requirements.-The base structure of the Army exists to support

Army missions. These missions are influenced by many factors; such as strategy,

budget, force level, Department of Defense guidance, weapons systems, new

technology, and so forth. As mission changes occur, an analysis of the resources,

including bases, allocated to accomplish that mission is made by the Department

of the Army staff agency having proponency for the mission. Existing resources

are weighed against the new requirements and adjusted accordingly. It is here

that those bases no longer required for accomplishment of the changed mission

are most frequently identified. It is here that the economies of consolidation,

realinement or reduction in scope of operations are identified. The ability of each

base to meet the unique operational and training requirements of the assigned

force or function is of paramount importance.

4. Budget/manpower constraints.-These constraints permit retention of only

the minimum number of bases; demand the avoidance of costs for unnecessary

56

personnel relocations; and militate against construction at those bases with

limited land area and outmoded, old, functionally inefficient facilities requiring

large investments for replacement facilities. Significant annual savings may result

from the closure of such bases. Consolidation of missions on a single multimission

base which subsequently results in a base closure generally produces significant

annual savings. However, these savings are offset in some instances by additional

investment at the gaining base. Additionally, onetime relocation costs become

a factor. In evaluating the budget implication of base realinements it is necessary

to weigh initial and annual savings against the onetime construction and move-

ment costs of the various options. In general, large outlays in construction or

equipment funds are not feasible and options which depend on such outlays are

avoided unless no other viable alternative exists.

5. Cost savings.-The objective of the Army is to accomplish the assigned

mission at the least cost. Where alternatives exist it is essential that the least

cost, both in terms of dollars and manpower, be selected. The decisionmaker

must not be lulled into thinking that the proposed action will save an amount

approximately equaling the base's operating budget and military pay if he

closes the base. In cases where the mission requirement for the base is eliminated,

a savings equaling the operations cost prior to phasedown and closure cannot

be achieved. As the activity phases down, fewer plumbers. carpenters, supply

clerks, et cetera, are needed and utility costs also decrease. Those savings would

be realized with or without closure. In cases where the mission is not eliminated

the savings as the base to be closed must be offset by the increased costs at

the base (or bases) assuming the mission to determine net savings. In this

connection, a base function easily overlooked is that of area support. Many

bases provide support to the Reserves, ROTC, recruiting activities, air defense,

aid a host of other Army and other service activities in the geographical area.

Although it is feasible to provide many of these services from another location,

or through contract, these alternatives carry offsetting costs.

6. Personnel turbulence.-The adverse impact of military and civilian 'per-

sonnel turbulence must be given significant consideration because of both the

high cost and the adverse effect on morale.

7. Civilian labor market.-Many Army missions involve utilization of a highly

specialized and unique civilian work force. Many of these people establish deep

roots in the local community and are reluctant to dislocate with the transfer

of the functions they perform. The lack of appropriate labor market thus

becomes a factor in evaluating proposed realinement actions.

8. Facilities/housing availability.-Maximum utilization of existing Govern-

ment facilities with minimum expenditures for new facilities is the primary

goal in realinement actions. This includes both misson related facilities and

support facilities. The falcility types that are of prime concern in base realine-

ment actions vary dependent on the mission under consideration. For combat

and combat support units, the firing ranges, vehicle maintenance space, parking

area and maneuver area are of major concern in evaluating realinement proposals.

Conversely, for administrative and headquarters activities, adequate adminis-

trative space is essential. For training activities, classroom and student housing

are key factors. For all actions, availability of housing- achelor and family-

is a significant element. However, facility availability varies in importance and

influence on base realinement actions. In some cases, mandatory requirementB

exist. For example, adequate firing ranges and maneuver area are an absolute

requirement for combat and combat support units. Certain unique facility re-

quirements are generated by intelligence, communications. logistical, and research

and development activities. Relocation of these functions which do not have

facilities available to accommodate them may not be feasible due to the cost

of new facilities. Also. due to mission requirements. the required facilities must

often be available prior to transfer of the function. This can often be expensive

in terms of delay in savings to be realized as well as redundancy in equipment

and facilities. Additionally. in considering bases for closure, the overall condi-

tion of the real property ;facilities at the base is aln important element in the

selection process. Relocation of an activity housed on a base with considerable

substandard facilities-both prime mission as well as support-may be most

effective even if certain facility criteria cannot be initially met. Over a period

of time provision of a few additional facilities could prove economically bens

ficial as opposed to a large expenditure for expensive replacement facilities at

the former base. An additional facility consideration is the extent of area sup

port to other bases. For example, if a base provides hospital, housing, and

57

other support facilities for surrounding bases, then it may not be possible to

completely close the base. As a result, savings from the realinement are signifi-

cantly less than at a base where all activities can be shut down and facilities

declared excess.

9. Capital investment (sunk coat).-Realinement actions are designed to

achieve the best utilization of permanent facilities at large, multimission, bases.

If relocation of a function or mission requires new construction of duplicate

facilities, then the cost reduction sought must be carefully weighed against

movement and construction costs that result from the proposed realinement.

This consideration is especially important in view of the shortage of construc-

tion funds and the large construction backlog. Where mission changes dictate

relocation of a particular function utilizing permanent facilities at a large,

multimission base, attempts are made to backfill the vacated facilities with other

compatible activities from small, singlemission, high cost bases or from leased

facilities.

10. Geographical location.-The geographic location influences the abiilty of

assigned forces to execute their mission. Weather, terrain, vegetation, proximity

to strategic airfields, transportation networks, and so forth, all contribute to reten-

tion of bases which enhance operational effectiveness. In some cases certain

mandatory elements may present themselves. For example, basic combat train-

ing and aviation training require good weather in order to maintain course

schedules. Combat and combat support training activities require appropriate

firing ranges and maneuver area. Each type unit has its unique requirements. A

geographical location which is adequate for the training of the infantryman

would not necessarily be adequate for the training of tank crews.

11. Land area.-The need for adequate and suitable land area to support

major combat units and their supporting forces is a major consideration. Bases

must be capable of supporting the readiness and deployment of the assigned

forces as envisioned in the U.S. strategy. This requirement often determines

which bases will be retained in the active inventory. Where mission compatability

can be achieved, the consolidation of activities at large, multimission bases, takes

precedence over utilization of small, singlemission bases.

12. Impact on other services/agencies.-The Army provides support to many

units and activities of the Department of Defense, the other services, and other

Federal agencies. Inherent in any base realinement action is consideration of

the impact on these agencies. The personnel turbulence and costs associated

with relocating or supporting these type activities are an integral part of any

analysis conducted.

13. Community impact.-Civilian support resources-that is, community

housing, medical, schools, and recreational facilities-are a consideration in

developing base realinement actions. Of particular importance is family hous-

ing. Areas which have residual capability to adequately house families negate

the cost of providing Government housing and facilitate rapid completion of

the proposed action. Adequate support should exist on or off a gaining installa-

tion to avoid a realinement action being counterproductive in terms of morale.

Since personnel support capability on our installations is limited, the contribu-

tion of the civilian community in this area is important. Conversely, realine-

ment actions, which reduce the Army presence in an area, seriously impact on

communities, particularly those in which the major source of the economic

base is the military installation. When possible, realinement actions are de-

signed to minimize the impact on local communities. Where appropriate, assist-

ance is provided to local community leaders in their negotiations with the Office

of Economic Adjustment, Department of Defense, whose function is to assist

communities in re-establishment of an economic base where reduction in Defense

expenditures has been severe.

14. Environmental impact.-All actions must be assessed to determine their

impact on the environment. Base realinement options must have an initial as-

sessment during the preliminary planning. If significant environmental impact

is indicated, or the action is determined to be controversial, at either a gaining

or losing base, then an environmental impact statement must be prepared.

15. Reserve components support.-The increased emphasis on utilization of

Reserve component forces to meet future contingency requirements must be

considered. Reserve units are generally constituted in areas where there are

Population resources. Their readiness depends upon availability of adequate

ranges and training areas. This requires that the range facilities and train-

iag areas not only be of the proper size and configuration, but also that they

58

be within reasonable commuting distance. Readiness is adversely affected by

increased commuting time and corresponding decreased training time avail-

ability. Concomitantly, personnel job satisfaction is lowered and personnel

recruiting and retention rates decreased. Many of our bases, both active and

inactive, are used extensively for support of these units, both for weekend

training and annual summer training. The impact on these type units is an

integral part of any analysis conducted.

16. Mobilization and contingency requirements.-The type and number of bases

required are determined by the need to be capable of supporting the strategy

directed by national policy, the operational and training requirements of the

Army, and the retention of sufficient flexibility to support unprogramed increases

in troop strengths. Coupled with this is the uncertainty as to when a base

might be needed again. The costs of inactivating and reactivating a base can

offset savings derived from its closure. Although we hope that we are entering

upon a prolonged period of peace-a hope and expectation which is not unlike

that after World War II and the Korean conflict-any decision to inactivate a

base, whether it is retained in standby status for mobilization and contingency

requirements, or is disposed of, is made without positive assurance that the

decision-in the long term-will prove to be a good one.

17. Encroachment.-Urban and airspace encroachment into vital areas sur-

rounding installations is of continuing concern. Some installations which were

originally remote have attracted major population growth and, as a result,

continued operations have been threatened through urban expansion. Civilian

aviation activity has served to restrict the airspace available for military opera-

tions. Encroachment, therefore, is an element in determining the future via-

bility of an installation. Currently, programs to protect installations from

encroachment are being instituted. These are comprised of efforts to obtain prop-

erties adjacent to bases so that only activities compatible with military opera-

tions will be developed in these areas. It is also possible that major weapons

changes may bring about encroachment "from within." For example, ranges

now adequate for artillery firing, may become too small for artillery weapons

which may be introduced in the future. However, where encroachment bas

become a problem, its impact is considered during development of base realine

ment actions.

18. Long range plans.-Since the future forces cannot be predicted with

certainty and are subject to unprogramed changes, flexibility to accommodate

these changes within the base structure should be preserved when possible and

economical. This entails developing reasonable assumptions on what unpro-

gramed force changes might occur and determining how the various options could

support the assumed force changes. However, flexibility is difficult to quantify

and, as a result, tends to be a subjective consideration. There are some instances

though which do lend themselves to objective analysis. For example, basic

combat training production capability at each training center can be deter-

mined. Based on the required levels of production, the degree of flexibility (un-

used production capacity) within the structure can be determined and the

degree that the structure can meet increases can be calculated. Similarly,

workload versus capacity can be determined in a quantifiable manner for produc-

tion and depot activities. Conversely, the degree of flexibility of the installation

structure to meet other program changes not the result of clearcut workloads is

difficult to determine. For example, the flexibility of the base structure to

accommodate major combat units currently deployed overseas, depends on many

variables. These variables include, type of units, equipment density, mission

requirements of the unit, if they are to be retained as Active Duty Forces, or

as Reserve Forces. Realinement alternatives are weighed in terms of their

potential to meet unprogramed force changes.

NAVY CRITERIA FOR REALINEMENT OF THE U.S. NAVAL SHORE E'BTABLISHMET

BACKGROUND

By 1975, the Navy's programed ship force levels will have been reduced by 40

percent and aircraft force levels reduced by 34 percent as compared with a

1964 base level. During this same timeframe the Navy has been unable to achieve

significant reductions in its shore establishment. This continuous reduction of

operating forces has created a corresponding excess of shorebased facilities

capacity to support these forces. In order to achieve a maximum of managerial

efficiency, elimination of excess capacities, redundancy of support facilities and

budgetary waste, the Navy is proposing a major realinement of its shore estab-

lishment. This realinement will provide for the reduction and consolidation of

CONUS shore activities and shorebased fleet activities commensurate with the

reduction of the operating units of the fleet already implemented, or antic-

ipated in the Department of Defense program fiscal year 1974-78.

GENERAL METHODOLOGY

With programed ship and aircraft force levels and corresponding personnel

end-strength reductions as the prime determinate, all ship homeport and aircraft

basing complexes were examined in detail, to determine their capacities and ex-

cesses. Homeporting/Squadron base-loading alternatives were developed to

achieve maximum utilization of excess capacities, availability of support and

the elimination of redundant and wasteful overhead. All major claimants ac-

tively participated in the identity and determination of those complexes no

longer required in support of the operating forces, including; ship homeport/air-

craft bases, supply and logistics, shipyards, air rework facilities, and research

and development facilities as well as administrative commands which do not

render measurable direct support to the operating forces.

CRITERIA

In the development of the Navy's shore establishment realinement proposals

the following significant factors were considered.

1. 1974-1980 force levels/mix.-(Includes the numbers and type of each ship

and aircraft, their weapon systems and specialized support required.)

2. Ship homeporting/aircraft basing excess capacities.-(Includes the identity

of requirements for pier spaces, anchorages, boat landings, runways, taxi strips,

parking aprons, hangar spaces and ship and aircraft support.)

3. Navigation limitations.--( Includes, restrictive drafts (depth of water),

transit time, shipping congestion, length and breadth of channel, specialized navi-

gational aids required, periods of reduced visibility and seasonal weather

conditions.)

4. Air space restrictions.-(Includes, approach patterns, airspace congestion

(civilian), noise factors, civilian encroachment, periods of reduced visibility and

seasonal weather conditions.)

5. Nuclear clearances.-(Includes nuclear area clearances existing by type and

future clearances required.)

6. Shipyard locations and capabilities.--(Includes nuclear surface/subsurface

repair capabilities and requirements, weapon and electronic systems repair ca-

pabilities and requirements, specialized drydock requirements by number and

type, civilian workforce availability and general repair/design capabilities.)

7. Accessibility to operating areas.-(Includes, transit time, air and surface

congestion, periods of reduced visibility, seasonal weather conditions and avail-

ability of services.)

8. BBQ/BOQ requirements.-(Includes increases in base complex population

entitlements, availability and desirability of private rentals, and adequacy of

messing requirements.)

9. Cold iron facilities.-(Includes availability of steam, water, air, and elec-

tricity including nuclear ship electrical power requirements, pollution abatement,

and nuclear waste disposal requirements.)

'10. Aviation support facilities.--( Includes airframe and engine rework require-

ments, new and future aircraft introductions, and contractor operations.)

11. Medical and supply support.--(Includes active and retired tri-service mili-

tary populations. CHAMPUS/Military Hospital cost comparison, location of sup-

ply centers vis-a-vis concentration, supply control centers, usage data, and type

depth of supply support requirements.)

12. Personnel support facilities.- (Includes availability and adequacy of social

and recreational facilities, public transportation, and distances from quarters

to facilities, commissaries and exchanges.)

13. Private and family housing.-(Includes availability and adequacy of

Public quarters and public rentals/sales. Excesses and short-falls have been

identified.)

14. Impact on the civilian economy.-(Includes loss of job availability, payroll

reductions, housing surpluses and unemployment.)

60

15. Environmental impact.-(Includes, decreases in solid waste, water, air,

and noise pollutants at losing complexes.)

16. Costs to implement.-(Includes, severance pay and unused leave pay to dis-

charged civilian employees, transportation costs for relocated employees, PCS

costs for military personnel and dependents, preservation and caretaker costs,

equipment transportation costs, and MILCON requirements at gaining activities.)

17. Savings achievable.--(Includes eliminated military and civilian salary

avoidances, overhead and maintenance costs, and approved MILCON costs

avoidance.)

CONCLUSION

The resultant smaller, realined shore establishment will constitute the "hard-

core" naval shore establishment through the 1980 time frame. Those naval com-

plexes proposed for major reductions and/or consolidations will remain soft

sites pending implementation authority or future study in the event implementa-

tion authority is denied. "Hard-core" Active Forces basing and principal support

complexes identified are :

SHIP HOMEPORT COMPLEXES

Naval Station (NAVSTA), New London, Conn.

Naval Station (NAVSTA), Norfolk, Va.

Amphibious Base, Little Creek, Va.

Naval Station (NAVSTA), Charleston, S.C.

Naval Station (NAVSTA), Mayport. Fla.

Naval Station (NAVSTA), San Diego, Calif.

Amphibious Base, Coronado, Calif.

Naval Station (NAVSTA), Alameda, Calif.

Naval Station (NAVSTA), Pearl Harbor, Hawaii

AIRCRAFT BASE COMPLEXES

Naval Air Station (NAS), Brunswick, Maine

Naval Air Station (NAS), Patuxent River, Md.

Naval Air Station (NAS), Norfolk and Oceana, Va.

Naval Air Station (NAS), Jacksonville, Fla.

Naval Air Station (NAS), Cecil Field, Fla.

Naval Air Station (NAS), Key West, Fla.

Naval Air Station (NAS), San Diego, Calif.

Naval Air Station (NAS), Miramar, Calif.

Naval Air Station (NAS), Lemoore, Calif.

Naval Air Station (NAS), Moffett Field, Calif.

Naval Air Station (NAS), Whidbey Island, Wash.

Naval Air Station (NAS), Barbers Point, Hawaii

PRINCIPAL INDUSTRIAL SUPPORT COMPLEXES

Naval Shipyard (NAVSHIPYD), Portsmouth, N.H.

Naval Shipyard (NAVSHIPYD), Philadelphia, Pa.

Naval Shipyard (NAVSHIPYD), Norfolk, Va.

Naval Shipyard (NAVSHIPYD), Charleston, S.C.

Naval Shipyard (NAVSHIPYD), Long Beach, Calif.

Naval Shipyard (NAVSHIPYD), Mare Island, Calif.

Naval Shipyard (NAVSHIPYD), Puget Sound, Wash.

Naval Shipyard (NAVSHIPYD), Pearl Harbor, Hawaii

Naval Air Rework Facility (NARF). Norfolk, Va.

Naval Air Rework Facility (NARF), Cherry Point, N.C.

Naval Air Rework Facility (NARF). Jacksonville, Fla.

Naval Air Rework Facility (NARF), Pensacola, Fla.

Naval Air Rework Facility (NARF), San Diego, Calif.

Naval Air Rework Facility (NARF). Alameda, Calif.

Each "hard-core" site was identified after exhaustive study of general or spe-

cial support capabilities peculiar to one of these complexes. Some had a greater

capability to absorb additional operating forces or populations than a cor-

responding "soft" site. Some had specialized support or repair capabilities not

possessed by other sites. Where general support or repair capabilities and home,

161

port/base loading excesses were basically equal, then optimum geographic loca-

tion/weather conditions and lower operating costs determined the selection of

the "hard-core" site. Programed military construction avoided or required as

well as the backlog of essential maintenance or modernization requirement costs

also played an important role in determining "hard-core" vs "soft" sites. In

each case, identified "hard-core" site has one or more tangible aspects for reten-

tion than its "soft" side counterpart as follows:

SHIP HOMEPORT COMPLEXES-NAVAL STATIONS (NAVSTA)

NAVSTA New London, Conn.-The major submarine training complex. Facili-

ties are not duplicated at any other complex, nor are they in excess to the needs

of the operating forces.

NAVSTA Norfolk, Va. (including amphibious base, Little Creek, Va.).-The

largest naval complex in the United States. The complexity and completeness of

support facilities and the availability of services and ship's berthing does not

exist at any other NAVSTA or combination of east coast NAVSTA's. There are

no restrictions on type of ships, nor major encroachment problems. This complex

is considered the ranking "hard-core" site in the United States and the last side

to be considered for major reduction.

NAVSTA Charleston, S.C.-The major SSBN submarine base and FBM sup-

port and training complex in the United States and the only SSBN base on the

east coast. NAVSTA Charleston possesses a full range of support facilities, piers

and services for nuclear subsurface and selected surface ship types. In addi-

tion, the Charleston complex is the only mine warfare training and support base

in the United States. The scope of its support and training facilities are not

duplicated at any other NAVSTA, nor are they in excess to the needs of the

operating forces.

NAVSTA Mayport, Fla.-The newest and only CV/CVA operating base other

than NAVSTA Norfolk, Va. Tactical considerations dictate the retention of two

complexes on each coast capable of supporting and berthing CV's. No other

NAVSTA possesses this capability besides NAVSTA Norfolk. The Mayport/

Jacksonville operating area is considered the finest on the east coast enjoying

almot universally ideal flying weather and unrestricted visibility for surface op-

erations. In addition, the Mayport complex provides access to the sea with the

least transit time to the local operating areas of any NAVSTA in the United

States.

NAVSTA San Diego, Calif. (including amphibious base, Coronado, Calif.-

The largest naval complex on the west coast. The complexity and completeness

of support facilities and the availability of services and ship's berthing does not

exist at any other NAVSTA or combination of west coast (including Hawaii)

NAVSTA's. There are no restrictions on size or type ship with the exception, at

this time, of nuclear propelled surface ships for which AEC clearance must be

obtained. This complex is considered the ranking "hard-core" complex on the

west coast.

NAVSTA Alameda, Calif.-The largest CV/CVA base complex on the west

coast and the only complex possessing the capability of supporting and berthing

CV's other than NAVSTA San Diego. Excess capacity does not exist at any other

NAVSTA or combination of NAVSTA's to absorb the ships homeported at

Alameda. NAVSTA Alameda, in addition possesses the only AEC homeporting

clearance for CVAN's on the west coast.

NAVSTA Pearl Harbor, Hawaii.-The farthest permanent Pacific base complex

capable of a full range of support for ships of all types and the major SSBN

submarine base in the Pacific. Its functions and support capabilities are not fully

duplicated at other west coast NAVSTA's, nor are they in excess to the needs

of the operating forces.

Conclusion.-NAVSTA's Key West, Fla., and Newport, R.I., possess no unique

support features or facilities which are not possessed by other east coast

NAVSTA's. Since neither of these complexes, singularly or in combination can

provide the specialized support required and rendered by the other NAVSTA's.

and because of the excess capacities existing at the other NAVSTA's. they are

not required for support of the operating forces in being or projected through

i the 1980's and are considered in excess to the needs of the Navy. The same criteria

u applies to NAVSTA Long Beach, Calif., as it relates to other west coast (including

; Hawaii) NAVSTA complexes.

r,

62

AIRCRAFT BASE COMPLEXES-NAVAL AIR STATION (NAS)

NAS Brunswick, Maine.-The northernmost and major ASW patrol (VP) op-

erating complex. Due to the principal submarine threat in the North Atlantic

and relatively short transit time to these waters, NAS Brunswick is considered

a top priority "hard-core" site.

NAS Patuxcnt River, Md.-The principal research and development (R. & D.)

aircraft operational test complex. Its facilities are not duplicated elsewhere and

are not in excess to the needs of the Navy.

NAS's Norfolk and Ocean a, Va.-The principal fighter (VF)/airborne early

warning (VAW)/light attack (VA) airciraft base complexes on the east coast.

Their proximity to homeported CVA's at NAVSTA Norfolk and their full range

of support facilities make them indispensable. Excess capacities and facilities

do not exist at other NAS's in sufficient depth to allow their excessing.

NAS's Jacksonville and Cecil Field, Fla.-The principal southern ASW patrol

(VP) and attack (VA) aircraft base complexes. NAS Jacksonville is the major

ASW operating complex in the southern east coast possessing a full range of

support facilities for this mission which are not in excess at any other site.

The close proximity of NAS Cecil Field to the CVA's homeported at NAVSTA

Mayport and the full range of its support facilities and base loading excess

capacity makes this complex ideal for retention and further base loading of

aircraft.

NAS Key West, Fla.-The southern and most strategically located of the east

coast NAS's provides basing for maritime air surveillance of the Caribbean area

in general and Cuban waters and the Gulf of Mexico in particular. Due to the

short transit time provided by this complex, its functions cannot be performed

by any other NAS without some degradation in time of response or on station.

In addition, excess capacity for base loading makes this complex ideal for reten-

tion and further base loading of aircraft.

NAS's San Diego and Miramar, Calif.-The principal Carrier ASW (VS), air-

borne early warning (VAW) and fighter (VF) NAS's located on the southern

west coast providing support to the NAVSTA San Diego, homeported CVA/CV

air groups. In addition, excess capacity exists at NAS Miramar which can be

utilized to produce efficiencies by maximizing base loading at NAS Miramar and

excessing an NAS elsewhere.

XAS Lcmnoore.-The principal attack (A) base on the west coast. Its facilities

are not duplicated at any other west coast NAS and are not in excess to the

needs of the operating forces.

NAS, Moffet, Calif.-The only ASW patrol (VP) base on the west coast (ex-

cluding Hawaii). Its facilities in support of the Pacific ASW effort are not dupli-

cated at any other west coast NAS and are not in excess to the needs of the

operating forces.

NAS Whidbey Island, Wash.-The major attack (VA) base on the west coast,

Its facilities are duplicated at NAS Lemoore; however, sufficient excess capacity

for base loading all west coast VA squadrons is not present at NAS Lemoore

which precludes the excessing of NAS Whidbey Island.

NAS Barbers Point, Hawaii.-The westernmost Pacific ASW patrol (VP) base.

The area of its squadron operations span water not capable of being covered

by VP squadrons from NAS Moffett Field due to transit and stay time. NAB

Barbers Point is not considered in excess to the needs of the operating forces.

Conclusion.-NAS's Quonset Point, R.I., Lakehurst, N.J. and Albany, Ga.

possess no unique support features or facilities which are not possessed by other

east coast NAS's. Since these complexes cannot provide the functional support

rendered by other NAS's, nor do they possess sufficient excess capacities for fund-

tionally base loading aircraft from other NAS's, they are considered excess to the

needs of the operating forces. Their aircraft squadrons can be base loaded within

the excess capacities and support facilities of other NAS's. The same rationale

pertains to the excessing of NAS Imperial Beach and the reduction of NAB

Alameda, Calif. on the west coast.

PRINCIPAL INDUSTRIAL SUPPORT COMPLEXES-NAVAL SHIPYARD (NAVSHTIPYD)

AND AIR REWORK FACILITIES (NARF)

NAVSHIPYD Port.smouth, N.H.-The smallest naval shipyard on the ea

coast- Portsmouth possesses the size drydock, type of equipment, boiler shq

and electronic capacity tto perform any trpe submarine repair work and new

submarine construction. While the facilities at Portsmouth may restrict the

63

amount and type of work it can do, Portsmouth has both the capability and cer-

tification to work on any class nuclear submarine in the fleet today. NAVSHIPYD

Portsmouth is not cosidered to be in excess to the needs of the Navy.

NAVSHIPYD Philadelphia, Pa.-The only building yard and one of two yards

capable of performing overhauls on CVA/CV's with facilities to perform work on

any ship type other than nuclear surface and subsurface ships. NAVSHIPYD

Philadelphia enjoys proximity to a near inexhaustable source of skilled man-

power. Its drydocks are among the largest in the Navy and are not in excess to

the needs of the Navy. Any consideration to excess NAVSHIPYD Philadelphia

would necessitate extensive MILCON expenditure to replace the NAVSHIPYD

Philadelphia drydocks at other complexes.

NAVSHIPYD Norfolk, Va.-The largest and most complete complex in the

shipyard inventory capable of any type of repair, alteration or modernization for

any type ship or submarine, nuclear or nonnuclear. Its facilities and capabilities

cannot be duplicated by any of the other east coast yards, singularly or in com-

bination. The Norfolk NAVSHIPYD is not excess to the needs of the Navy.

NAVSHIPYD Charleston, S.C.-A shipyard located at a major "hard-core"

NAVSTA complex with a wide range of capabilities both surface ship and nuclear

submarine. Excessing this yard in return for the retention of the Portsmouth,

N.H. NAVSHIPYD would allow a major dual purpose yard to be replaced by

essentially a single purpose one, and one that would require extensive and pro-

hibitive modernization if it were to remain viable through the 1980's. NAV-

SHIPYD Charleston is not considered to be in excess to the needs of the Navy.

NAVSHIPYD Long Beach, Calif.-A relatively modern shipyard with a full

range of repair or alteration capability with the exception of submarine and

nuclear propulsion. The Long Beach Yard is the most modern and complete

weapons and electronic systems yard on the west coast. The completeness of its

facilities are not fully duplicated at other west coast yards. NAVSHIPYD Long

Beach is not considered to be in excess to the needs of the Navy.

NAVSHIPYD Mare Island, Calif.-A nuclear submarine building and repair

yard. Unlike the east coast, where commercial nuclear submarine repair ship-

yards exist, the west coast possesses only three nuclear certified repair yards-

all of them Navy. A lesser number than three cannot meet the needs of the Navy

through the 1980's even if prohibitive expansion were contemplated. The Mare

Island NAVSHIPYD is not considered to be in excess to the needs of the Navy.

NAVSHIPYD Puget Sound, Wash.-The largest shipyard on the west coast in

terms of drydock capacity and major new construction capability. This yard

is also one of the nuclear certified repair yards and is capable of both major

surface and subsurface nuclear ship overhauls. It is also the only west coast

yard capable of nuclear major ship (CVAN) overhaul. Its capabilities are not

duplicated at other west coast yards. NAVSHIPYD Puget Sound is not considered

in excess to the needs of the Navy.

NAVSHIPYD Pearl Harbor, Hawaii.-The westernmost Pacific shipyard

capable of most types of overhauls including, nuclear submarine, surface ship

and effecting emergency CVA/CV repairs. Due to its strategic location and the

"hard-core" NAVSTA Pearl Harbor proximity, this yard is considered essential

to the needs of the Navy.

Conclusion.-The reduced ship force levels in being today and new construc-

tion types and numbers projected through the 1980's provide for an excess of

NAVSHIPYDs which cannot be gainfully utilized or economically loaded. This

excess capacity has become an intolerable financial burden which can no longer

be justified. With capabilities, modernization costs and drydock requirements as

principal determinates, it has been found that Boston. Mass.. can be excessed

without necessitating any new drydock construction through 1980.

The remaining east coast yards are capable of rendering all the support re-

quired now and through the 1980's. The retention of NAVSHIPYD Boston is both

uneconomical and unjustifiable due to its lack of multipurpose capability. Ex-

cess capacity existing on the west coast can be rectified only by the excessing

of NAVRSHIPYD Hunters Point. The closure of this yard does not require the

construction of any new drydocks.

NARF'A.-Projected aircraft and engine rework for present and projected

naval air forces by numbers and types produces aan excess in air rework require-

ments by one NARF. The criteria for selection of "hard-core" complexes was

carefully reviewed and revealed no singular advantage to the excessing of any

specific NARF from a pure workload, efficiency or function without its host

NAS, then the requirement for the NAS became the prime determinant. The

20-192 (Pt. 1) 0 - 73 --

64

"soft coring" of NAS Quonset Point, R.I., produced the single NARF candidate

in excess of the needs of the Navy. The retention of NAS Quonset Point in sole

support of the NARF requires the continuation of a complex which is neither

economical or justifiable.

MISCELLANEOUS sUPPORT ACTIVITIES

Hospitals.-If a major naval complex is closed, closure of the supporting

hospital is expected. When setting priorities for expenditures of funds for oper-

ating Navy medical services, it is considered that areas containing the largest

number of active duty naval personnel, and particularly the junior ranks and

lower pay grades, should receive priority. Because medical care has proved to

be a major factor in retention of career personnel, the Navy must insure expan-

sion of medical capabilities in areas in which the Navy population increases

incident to facility consolidations.

Portsmouth, N.H.-Transfer of active duty personnel from Portsmouth greatly

reduces the need for Navy medical services in the area. Champus and medical

services available at Pease Air Force Base can provide services for retired

military personnel in the area at substantial savings.

Chelsea, Mass.-Continued operation will require extensive Milcon which

cannot be justified in view of the number of active duty personnel remaining in

the Boston area. Substantial savings can be realized by closure of this hospital.

St. Albans, N.Y.-Reduction of military personnel in the area, continuing de-

crease in patient load and extensive Milcon required to upgrade present facili-

ties preclude the retention of St. Albans.

Boston Naval Station Complex.--The programed force reduction, closure of

the shipyard and ship relocations from the New England area reduces the

naval station's support functions to a level which precludes its continued opera-

tion. The elimination of the supporting activities in turn dictates a substantial

reduction or elimination of the first naval district headquarters staff as its

tasks are reduced.

Naval Training Center (NTC), Bainbridge, Md.-Included within this training

complex are buildings in various states of repair. To retain Bainbridge in its

present status would require extensive new construction. Existing facilities and

training requirements are available and can be fulfilled at other locations for

most activities. The remaining activity, the Naval Academy Preparatory School,

can be housed in permanent buildings at the site, excessing remaining land and

buildings.

Naval Ammunition Depot (NAD), Oahu, Hawaii.-The reduction of force

levels and associated ammunition storage requirements in the Pacific permits

the closure of one of three branch storage areas at NAD Oahu. The remaining

branches are capable of supporting area ammunition requirements providing

for excessing of land and reductions of operating costs.

Naval Support Activity (NSA), Omaha, Nebr.-Emphasis on Reserve Forces

capabilities dictates the consolidation of all reserve force administration into

one command at one location. The requirement for the support activity at

Omaha is eliminated once the surface Reserve headquarters is relocated. This

will result in a reduction of personnel and operating costs and provide for a

more efficient operation of the shore establishment.

Naval Air Engineering Center, Philadelphia, Pa.--The mission and functions

of the center can be assumed by the Naval Air Test Center (NATC), Lakehurst

and the Test Center at NAS Patuxent River. The center's mission to conduct

research, development, test and evaluation (R.D.T. & E) of systems integra-

tion and fleet engineering support in launching, recovery and landing aids for

aircraft and in ground support equipment for aircraft and airborne weapons

systems is closely related to the missions of the foregoing activities and the

facilities are generally duplicated at those activities.

Navy Electronic Systems Test and Evaluation Facility, St. Inigoes, Md.-'

The functions and tasks of the facility can be transferred to the Naval

Electronics Laboratory at San Diego. using existing excess capacity at that

location. Facilities currently exist at China Lake to provide for testing of air

craft navigation and traffic control systems. This consolidation will providE

for more efficient operations at a reduced cost and utilize excess capacities and

facilities at these sites.

Naval Air Station, Glynco, Ga.-The air station supports naval flight officer

training and technical training of enlisted and officer students. Naval flight

officer (NFO) training at Glynco supports only approximately 17 percent of

65

the total NFO student load. This amount of training can be absorbed at Pensa-

cola in existing facilities. Naval air technical training students can be relocated

to NAS Memphis, NAS Meridian and Dam Neck, Va., utilizing excess facilities

now existing at those locations. Consolidation of training is desirable and the

closure of Glynco will result in more efficient base loading within the training

command.

Electronics Supply Ofice, Great Lakes Consolidation.-Navy has three inven-

tory control points (ICP's)-electronics supply office (ESO), Great Lakes, Ill.;

ships parts control center (SPCC), Mechanicsburg, Pa.; aviation supply office

(ASO), Philadelphia, Pa. Each ICP is a center of technical competence; ESO

and SPCC are primarily fleet surface/subsurface oriented while ASO is air

oriented. Analysis of the efficiencies and excess capacities at each inventory con-

trol point reveals we can consolidate ICP's and achieve savings in overhead costs.

The most expedient approach is to consolidate the data base and automatic data

processing (ADP) centers of ESO and SPCC since both ICP's are primarily fleet

surface/subsurface oriented. Consolidation of ASO with another ICP was con-

sidered; however, in terms of line items managed, space requirements/avail-

ability and ADP capability, the consolidation at SPCC Mechanicsburg, Pa., is the

only feasible alternative for centralized ADP operations for the two ICP's. From

a weapon systems management point of view, the consolidation action is not

without risks. Some degradation in fleet support is possible. For this reason the

action cannot be completed immediately. A phased-in consolidation would result

in some immediate savings in personnel and administrative overhead. Later with

a merged data management, additional savings can be achieved. It would appear

that if a systematic and phased approach to the consolidation is taken to insure

that weapon system capability is maintained, satisfactory and timely support

will be continuously provided to operational and emerging weapon systems.

To provide sufficient support and planning time, 3 years will be required to

complete this effort. Out year achievable savings of $2.2 million will result from

this proposal.

GENERAL AIR FORCE

CRITERIA FOR BASE REALINEMENT ACTIONS

The base posture of the Air Force exists to support the assigned forces. The

major considerations and criteria used to determine base realinements must

insure that the action selected from the available alternatives is the most con-

sistent with the overall mission requirements of the Air Force and retains in the

inventory the most effective bases. In determining the effectiveness of an in-

stallation, several major considerations are germane.

Operational and training requirements.-Each force element has its own pecu-

liarities in terms of misison and training which manifests itself in terms of air-

space, range requirements, facility requirements, and so forth. Base realinements

should enhance the ability of the force to meet its unique operational and train-

ing requirements.

Force deployment.-The Air Force structure is based on the national strategy

which determines which forces should be deployed overseas and which forces

would be deployed or employed from the CONUS. This serves to determine how

many and what kind of bases we need overseas versus the CONUS.

Use of multimission bases.-A major expense of each installation is the re-

sources required to "open the door". This base operating and support force does

not increase in a direct proportion to a growth in assigned base missions. Addi-

tion of new missions to an existing base results in significantly less base oper-

ating and support resources than does operating a single-mission installation.

Future flexibility.-Base realinement actions which result in base closures or

contribute to the maximum utilization of an installation can result in a limiting

of future flexibility to meet future force adjustments. The selection of bases to be

closed should result in closure of the least flexible bases.

The following criteria are used for evaluating base realinement alternatives:

Geographlio location.-The geographic location of an installation influences

many factors which bear on the ability of assigned forces to execute their mis-

sion. These include weather, availability of training areas, airspace, and so

forth. For each mission there are optimum geographic locations which provide

maximum operational affectiveness.

Facility availability.-Maximum practical utilization of existing Government

facilities with minimum expenditures for new facilites should be a primary

gpal in realinement actions.

,66

Community support.-When possible, base realinement actions should take

maximum advantage of already developed civilian resources; (that is, housing,

medical, schools, and so forth.) which can be used to support the assigned

personnel.

Potential.-Since the future forces cannot be predicted with certainty and

are subject to unprogramed changes, flexibility to accommodate these changes

within the base posture should be preserved when possible.and economical.

Encroach-ment.-Encroachment into vital areas surrounding installations is of

continuing concern. Urban expansion and increased civil and private air activity

has served to restrict military operations at some installations.

Budget.-High-cost, single-mission installations requiring large investments

for replacement facilities are prime candidates for closure. Significant annual

savings result from the closure of such bases. However, these savings are offset

in some instances by the required investment, particularly in facilities, needed

to consolidate. In evaluating the budget implication of a base realinement it is

necessary that initial and annual savings be weighed against the one-time con-

struction and movement costs of the various options.

Environment.-All actions must be assessed to determine their impact on the

environment. If significant environmental impact is indicated, then an environ-

mental impact statement must be filed.

Mission degradation.-Realinement actions result in turbulence both in per-

sonnel and in mission output. Certain activities cannot be allowed to "stand

down" and, as a result, realinement of these activities require in being capability

at the new location. Also, a highly specialized or unique work force of civilians

may not facilitate relocation.

SPECIFIC AIR FORCE CRITERIA FOR BASE REALINEMENT ACTIONS

Purpose.-The purpose of this document is to present the major considerations

and criteria used within the Air Force in developing base programs which result

in realinement actions.

Background.-The base posture of the Air Force exists to support the assigned

forces. Since forces are a dynamic element, the base posture is also dynamic in its

nature. As forces change, base requirements change, and as a result realinements

in the base posture are required. The major considerations and criteria used to

determine base realinements must insure that the action selected from the avail-

able alternatives best meets the various operational, geographic, facility, en-

vironmental and economic parameters and is the most consistent with the over-

all mission requirements of the Air Force. The Air Force has pursued a policy of

achieving an optimum base structure to support the currently assigned and

projected forces. As force levels and oversea deployments have reduced during the

last 12 years, the number of Air Force bases has also reduced. The following

table reflects the reduction in Air Force major installations since fiscal year 1960.

Fiscal year-

Major installation 1960 1964 1968 1970 1972 1973

CONUS _..... 163 151 129 116 112 111

Overseas . . 90 65 69 62 49 47

Total-...........--... - - - 253 216 198 178 161 158

The reduction in the number of Air Force bases worldwide has been the

result of a continual evaluation of the forces' base requirements. The most

effective bases are selected for retention when base closure actions are initiated.

Major considerations and criteria.--In determining the effectiveness of an in-

stallation, several major considerations are germane. First is the need to pro-

vide installations which meet the various operational and training requirements

of assigned forces. Second, there is the need to provide bases to support the force

deployments envisioned in the United States strategy. Third is the policy that

mnultimission bases, i.e., ones at which various force types (strategic, logistical,

airlift, etc.) are stationed, will be used to the maximum extent possible. Fourth,

that the base posture should retain the flexibility to bed down the force when

unprogramed changes occur.

The above considerations have evolved into broad criteria which are used in

the Air Force in developing and evaluating base realinement actions. These are:

geographic location; facility availability and condition; community support

available for Air Force activities/population; potential to accommodate future

force requirements; existing or future encroachment which might impact Air

Force operations; budgeting consideration inherent in the proposed realinement

action; possible adverse environmental impact; and mission degradation as a

result of force turbulence.

In developing realinement actions, the major considerations and criteria have

to be evaluated for each proposal in total, as opposed to each one being inde-

pendent, with the goal of achieving an optimum balance. A discussion of the four

major considerations and the resultant criteria is provided below.

Major considerations

Operational and training requirements.-Since the Air Force base posture ex-

ists to support the mission of the assigned forces, the ability of each base to

meet the unique operational and training requirements of the assigned force

is of paramont importance. Each force element, such as strategic offense, tactical

fighter, strategic airlift, etc., has its own peculiarities in terms of mission and

training which manifests itself in terms of airspace, range requirements, de-

ployment and employment routes, availability of lines of communications, sur-

vivability, facility requirements, etc. The current base posture reflects a force

bed down in which the forces' operational and training requirements are best

supported. Realinement of forces can make alterations of the base posture neces-

sary; however, the resulting bed down must, to the extent possible, enhance the

ability of the force to meet its unique operational and training requirements.

These requirements are summarized below.

Strategic offense (bombers/tankers).-Prelaunch survivability of the alert

force coupled with geographic locations which allow proper bomber-tanker mating

after launch and optimum entry into primary employment routes to target

areas.

Strategic defense (fighter interceptors).-Peripheral coverage of the con-

tinental United States.

Tactical fighter.-Accessibility of weapons ranges (air-to-air and air-to-

ground) plus sufficient airspace to allow for extensive operational training in

flight maneuvers such as formation flying. Maximum "good weather" days to

facilitate operational flight training under visual conditions.

Tactical airlift.-Accessibility to training areas for assault landing and drop

zones and close proximity to Army elements which use tactical airlift support

in training and during deployment.

Strategic airlift (MAC).-Accessibility to transportation networks which

can carry cargo/passengers to and from the terminal complex, coupled with

proximity to cargo generation areas.

Pilot training.-Availability of a large area of dedicated airspace which is

required for student flight activities coupled with minimal poor weather days

which could preclude visual flight activities.

Air Reserve Forces.-Potential to man assigned units.

Force deployment.-The Air Force structure is based on the national strategy.

This strategy determines potential areas in which forces would be used and

determines which forces should be deployed forward in overseas locations and

which forces would be deployed or employed from the CONUS. This strategy

then serves to determine how many and what kind of bases we need overseas

versus the CONUS.

Use of multimission bases.-A major expense of each installation is the

resources required to "open the door." That is the basic number of people and

things needed to support any assigned mission. This base operating and support

force, however, does not increase in a direct proportion to a growth in assigned

base missions. Addition of new missions to an existing base results in signifi-

cantly less base operating and support resources than does establishing a new

base or retaining and operating a single-mission installation which is not limited

by geographic or other requirements. Therefore, when missions are compatible

and facilities available or obtainable, it is cost-advantageous to develop multi-

mission bases. This is particularly true when one of the missions is of a support

nature such as headquarters, materiel depot, or research and development activity

and the other is operational such as tactical fighter, strategic bomber, etc. Addi-

tionally, missions which have a relatively small number of personnel or equip-

68

ment are most economically accommodated on bases which have other major

missions. An example is the stationing of ADC fighter interceptor squardons on

bases which have other major missions such as airlift or strategic offense.

Although multimission bases are economical, the compatibility of missions must

be given prime consideration. Certain missions, such as pilot training, do not

lend themselves to multimission installations. Additionally, the more missions

assigned to an installation the greater the difficulty in closing the installation

if a major mission at the base is reduced, since relocation of residential missions

often proves impractical. In this sense, on the basis of a reduced base structure,

multimission bases may inhibit future flexibility in restructuring the overall

base posture.

Future flexibility.-Base realinement actions which result in base closures

or contribute to the maximum utilization of an installation, especially Air Force

bases which contain a relatively small amount of land, can result in a limiting

of future flexibility to meet various programed and nonprogramed force adjust-

ments. Although base closures and maximum base utilization are economically

sound objectives, the selection of bases to be closed, should, to the extent pos-

sible, therefore, result in closure of the least flexible bases. If flexibility were

the sole determinant, bases which have constraints in the nature of airspace,

encroachment of civilian activities, single missions, limited real estate, poor

community support facilities, poor physical facilities, etc., should logically be

considered for closure prior to bases which have the potential to accommodate

additional or new missions.

Criteria

iGeographic location.-The geographic location of an installation influences

many factors which bear on the ability of assigned forces to execute their mis-

sion. These include weather, availability of training areas, proximity to employ-

ment/deployment routes, survivability, airspace availability, transportation

networks, etc. For each mission there are optimum geographic locations which

provide maximum operational effectiveness. These locations, to the extent pos-

sible, should be used in selecting bases to beddown missions. In some cases

certain mandatory elements may present themselves. For example, under-

graduate pilot training requires 216 good weather work days during each year

in order to maintain the course schedule. Locations which cannot meet this

weather criterion should not be considered for such a mission. Tactical fighter

activities require that appropriate air-to-ground and air-to-air ranges be in

close proximity (200 miles). Lack of these ranges requires that training be

degraded by reduced mission time as a result of increased ferry time to and

from the range. Therefore, lack of a range in close proximity to a base eliminates

it from consideration as a tactical fighter base. However, other geographic factors

are not as binding in developing base realinements. For example, survivability

of strategic offensive forces is a prime consideration.

If submarine-launched missiles are postulated to be the most critical threat,

inland bases provide the greatest survivability due to the longer flight time

of the missiles. However, this does not imply only inland 'bases should be con-

sidered for strategic offensive forces. Consideration of factors such as the inabil-

ity of the runway complex to support strategic operations, lack of needed large

maintenance facilities to house strategic bombers and tankers, poor quantity

and quality of personnel support facilities, and lack of munitions storage ca-

pability all may negate the use of an existing inland base for a strategic force

main operating base and dictate continual use of a coastal base where these

facilities are available. In this case, survivability can be achieved through repos-

turing and dispersal of the alert force at satellite locations to achieve the needed

time to safely launch the force.

Facility availability: Maximum practical utilization of existing Government

facilities with minimum expenditures for new facilities should be a primary

goal in realinement actions. This includes mission-related facilities as well as

support facilities. The facility types that are of prime concern in base realinement

actions vary dependent on the mission under consideration. For example, if tJe

unit is an operational flying activity, the runway complex (number, width,

length, load hearing capacity), capacity of the aircraft parking ramp, and a

maintenance complex capable of supporting the assigned aircraft (e.g., proper

sized docks and hangers, sufficient communications-electronics and avionics main-

tenance solace, etc.) are of major concern in evaluating the proposed action.

Conversely, for administrative and headquarters activities, the proper amount

of administrative space is essential. For training activities, classroom and stu-

69

dent housing are key factors. For all actions, availability of housing (bachelor

and family) for any increase in population is a significant element. However,

facility availability varies in importance and influence on base realinement

actions.

In some cases, mandatory requirements exist. For example, parallel runways

are an absolute -requirement for undergraduate pilot training since the mix

of training aircraft and number of air momements cannot be accommodated on a

single runway. Bases with single runways do not meet the facility requirements

for this mission and generally would not be considered as a feasible alternative in

realinement of pilot training bases without construction of additional run-

ways. Additionally, certain unique facility requirements are generated by intel-

ligence, communications, logistical, and research and development activities;

relocation to installations which do not have facilities available to accommo-

date these functions may not be infeasible due to the cost of new facilities. this,

however, is a matter of economics. Also, due to mission requirements, these fa-

cilities must often be duplicated and in being prior to shutting down the current

activity. This can often be expensive in terms of delay in savings to be realized

as well as redundancy in :equipment and facilities. Similar circumstances exist

in relocating other missions such as strategic airlift which requires large terminal

complexes to receive and process cargo. However, other facility requirements

might not be less critical. Requirements for small missions may be provided

with minor modification. This is particularly true if the unit's equipment con-

sists of small aircraft or if no aircraft are assigned. Requirements for admin-

istrative space can be met in various ways such as conversion of excess space in

other functional areas. Additionally, in considering bases for closure, the over-

all condition of the real property facilities at the base is an important element

in the selection process. Often, if an activity is housed on an installation which

has a great deal of substandard deteriorated facilities-both prime mission as

well as support--then relocation to a base with permanent facilities may be most

effective even if certain facility criteria cannot be initially met.

Over a period of time provision of a few additional facilities would prove

'economically beneficial as opposed to providing a large number of expensive re-

placement facilities at the previous base. An additional facility consideration is

the extent a base's facilities support other installations in the area. For ex-

ample, if a base provides hospital, housing, and other support facilities for

surrounding installations, then it may not be possible to completely close the

base. As a result, savings from the realinement may be significantly less than at

a base where all activities can be shut down and facilities declared excess.

Community support. Civilian support resources (comunity housing, medical,

schools, recreational facilities) are a consideration in developing base realine-

ment actions. When possible, base realinement actions should take maximum

advantage of already developed civilian resources which can be used to support

the assigned personnel. Of particular importance is family housing. Areas which

have residual capability to adequately house Air Force families will negate the

cost of providing Government housing and facilitate rapid completion of the

proposed action. Conversely, areas in which community support facilities are

limited place an increasing degree of importance on the base facilities. Adequate

support should exist on or off a gaining base to avoid a realignment action be-

ing counterproductive in terms of personnel morale. Since excess personnel sup-

port capability on our installations is limited, the contribution of the civilian

community in this area is very important.

Potential.-Since the future forces cannot be predicted with certainty and are

subject to unprogrammed changes, flexibility to accommodate these changes

within the base posture should be preserved when possible and economical. This

entails developing reasonable assumptions on what unprogramed force changes

might occur and determining how the various basing options could support the

Assumed force changes. However, flexibility is difficult to quantify and, as a

J result, tends to be a subjective consideration. There are some instances though

Which do lend themselves to objective analysis. For example, pilot production

capacity at each undergraduate pilot training base can be determined. Based on

the required levels of pilot production, the degree of flexibility (unused produc-

on capacity) within the system can be determined and the degree that the

stem can meet increases can be calculated. As a result, the degree of flexibility

the system can be predicted and controlled. Similarly, workload versus base

pacity can be determined in a quantifiable manner for other training activities

depot activities. As a result, flexibility in these areas is to some degree

tifiable. Conversely, the degree of flexibility of the base systems to meet

70

other program changes not the result of clear-cut workloads is difficult to de-

termine. For example, the flexibility of the base system to accommodate tactical

units in the Conus currently deployed overseas depends on many variables such

as type of unit, activity levels of the unit, if they are to be retained as active

duty forces or as reserve forces, et cetera. In these instances the underlying

assumptions are subjective and the requirement for flexibility is also subjective.

Notwithstanding the subjectivity, it is important that base realinement alterna-

tives be weighed in terms of their potential to mee unprogramed force changes.

Enoroachment.-Urban and airspace encroachment into vital areas surround-

ing installations is of continuing concern. Some installations which were origi-

nally remote have attracted major population growth and, as a result, continued

air operations have been threatened through urban expansion. The increased

civil and private air activity has served to restrict the airspace available for

military operations. Encroachment, therefore, is an element in determining the

future viability of an installation and is a consideration in determining base

realinement actions. Currently, programs to protect installations from encroach-

ment are being instituted. These are comprised of efforts to obtain zoning, ease-

ments, or fee ownership of properties adjacent to 'bases so that only activities

compatible with air operations will be developed in these areas. As a result,

encroachment should be brought under control. However, where encroachment

has become a major problem, its impact should be considered during development

of base realinement actions.

Budget.-High-cost, single-mission installations with limited real estate and

outmoded, old, functionally inefficient facilities requiring large investments for

replacement facilities are prime candidates for closure. Significant annual sav-

ings result from the closure of such bases. However, the relative cost effective-

ness of retaining installations is also a major factor in determining base realine-

ments. Consolidation of missions on a single multimission installation which

allows a base closure generally results in significant annual savings. However,

these savings are offset in some instances by the required investment, particu-

larly in facilities needed to consolidate. Additionally, one-time relocation costs

are a factor.

In evaluating the budget implication of base realinements it is necessary that

initial and annual savings be weighed against the one-time construction and

movement costs of the various options. Consideration should be given to con-

solidations which minimize the investment in new facilities while maximizing

the annual savings. In general, large outlays in construction or equipment funds

are not feasible and options which depend on such outlays should be avoided

unless no other viable alternative exists.

Environment.-All actions must be assessed to determine their impact on the

environment. Base realinement options must have an initial assessment during

the preliminary planning. If significant environmental impact is indicated, for

example at a gaining installation, as a result of the assessment, then an environ-

mental impact statement must be filed.

Mission degradation.-Realinement actions, by their very nature, result in

turbulence both in personnel and in mission output. The degree of turbulence is

a consideration if the resulting mission degradation is of such a proportion as

to be significant. Certain activities cannot be allowed to "stand down" and, as a

result, realinements of these activities require in being capability at the new

location. Also, work force composition is a consideration in that a highly spe-

cialized or unique work force of civilians may not facilitate relocation. These

factors should be considered in evaluating realinement actions.

BASE REALINEMENT METHODOLOGY

Mr. LONG. Will you discuss the methodology used in determining the

base realinement actions and how these criteria were utilized by the

military departments?

Mr. SHERIDAN. Yes, sir. As you know, Mr. Chairman, we are con-

stantly reviewing our base structure both in the U.S. and overseas. As

part of this process, installations and activities are identified for pos-

sible realinement or closure. Periodically, as we did last year, we issu

guidance to the Military Departments on base realinements. This guide

ance is not only administrative in nature but is also specific in that we

try to establish the kinds of actions the services should consider in their

on-going reviews. In the case of the realinement plan recently an-

nounced, our staff first and then subsequently the Secretary of De-

fense intensely reviewed the major actions against the established base

utilization criteria. As you can appreciate, the decisionmaking process

on base realinements is not an exact science and involves judgments

which must be made with each weighed against the basic criteria. In

this manner, a base is finally selected for closure after the tradeoffs of

the various bases under consideration have been evaluated.

With regard to the plan announced April 17, 1973, this process re-

sulted in some modifications to the proposed plans and called atten-

tion to the need for further review in the case of still other proposed

realinements.

Mr. LONG. It appears that the Army's headquarters reorganization

was not coordinated with their base realinement package. Are there

other similar situations in the other services? Provide that for the

record.

Mr. SHERIDAN. The Army reorganization plan to which you refer

was to a great extent driven, as the name implies, by the need to reor-

ganize. It was principally aimed at the major headquarters structure

and the base and facility implications became, I believe, secondary

to its prime purpose. While it was approved and announced prior to

the base closure package, I cannot help but feel certain that within the

Army these actions were indeed coordinated.

In answer to the second part of your question, I know of no other

similar situations.

Mr. LONG. What coordination has there been between the services

realinement packages? Cite some examples of cross-service utilization

resulting from the realinements. Is this something which you are con-

tinuing to follow up on ?

Mr. SHERIDAN. Once the review of the proposed realinement actions

has been completed by our staff, all proposals are staffed and discussed

with the other interested OSD staff and the military departments. This

is accomplished in order to evaluate the actions and to insure inter-

service review. As part of our continual review of the base structure, we

are in a good position to very early identify the interservice problems

or opportunities for interservice utilization. For this reason, we usually

identify these problems and opportunities to the services. For instance,

the significant realinement of the Army's Fort Story provides the Navy

with the opportunity of acquiring land for the construction of its

much needed family housing in the Norfolk area. Also, the closure of

McCoy Air Force Base, Fla., provides the Navy with the opportunity

of acquiring needed family housing for the nearby Naval Training

Center, Orlando, Fla., thereby saving the cost of constructing such

facilities. Many other similar examples could be cited. In addition,

in answer to the latter part of your question, we continue to follow

up on these matters.

SUMMARY OF BASE CLOSURE SAVINGS AND COSTS

i Mr. LONG. Just to make the record complete, insert a summary of the

base closure package for the record. Show what savings and what costs

arc anticipated.

[The information follows:]

REALINEMENT PACKAGE, APR. 17, 1973

Jobs eliminated Annual

Number of -- savings 1-time costs

Service actions Military Civilian (millions) (millions)

Army .............. ..-------------- 35 2,333 2,257 $57.8 $48.7

Navy ......-------------------------------- 199 9,912 19,131 221.6 252.0

Air Force .......------------------- - 40 4,395 4,784 95.6 22.1

DOD total----.. ....._..._____ . 274 16, 640 26, 172 375.0 322.8

SUMMARY OF CONSTRUCTION AVOIDED AND REQUIRED AS RESULT OF ARMY

REORGANIZATION

Mr. LONG. Also, insert in the record the data on construction avoided

and required as the result of the Army reorganization package.

[The information follows:]

The construction on the Army reorganization plan announced by the Army on

January 11, 1973, is as follows:

SUMMARY OF MILITARY CONSTRUCTION COSTS REQUIRED AND AVOIDED AS A RESULT OF THE ARMY REORGANI.

ZATION ANNOUNCED JAN. 11, 1973

[Amount in thousands of dollars]

Fiscal year-

Long

1973 1974 1975 1976 1977 1978 Total range

Construction required...-------... 4,154 4,598 3,377 0 1,700 0 13,829 42,199

Construction avoided........ 0 2, 503 10, 316 2,637 4, 607 1,228 21,291 38,576

FAMILY HOUSING AT CLOSED BASES

Mr. LONG. Provide for the record the details on the family housing

which will be released as the result of the base realinements.

[The information follows:]

The military departments are now carefully screening their family housing

requirements at all locations affected by the base closures and realinements

announced on April 17, 1973. Preliminary informal information indicates that

requirements may justify retention of about 2,000 of the 13,366 units at affected

locations. The remainder will be released.

RELOCATION OUT OF WASHINGTON

Mr. LONG. What progress has been made in the program to relocate

activities out of Washington ?

Mr. SHERIDAN. Not enough, since we were here last year, as far as I

can see.

There have been several reasons for this. One was a larg base closure

reduction and realinement package that was developed during this

period and announced last month. The package did include some minor

actions affecting the National Capital region, but its main thrust was

toward force and weapons system orientation, and thus it impacted

most significantly on operating type facilities as opposed to adminit

trative types which predominate in the Washington area.

73

A second important reason is, of course, the change in top manage-

ment of defense which has not yet had an opportunity to bring this

problem into focus. The new Secretary of Defense, Mr. Richardson,

who is about to leave to go to the Attorney General's post, has not been

made aware of the problem, and we hope that-

Mr. LONG. Is that the new-new Secretary ?

Mr. SHERIDAN. That the newest, Mr. Schlesinger, we want to take it

up with him as soon as he arrives on board. Progress has not been

satisfactory.

Mr. LONG. When you say progress has not been satisfactory, are you

saying that they are putting new things into the area, or proposing new

programs for the area, faster than they are proposing moves out of the

area?

Mr. SHERIDAN. NO, sir, I would not give that impression at all. The

number of organizations and total number of people that may have

been relocated from outside Washington to the Capital region in the

past year is negligible.

We will provide the number for the record, sir. It is very difficult

for any agency of the Defense Department to come into the Washing-

ton area without meeting all the criteria established in the directive

we referred to last year. The criteria are quite stringent. There has to

be an overwhelming requirement to move anything into this area.

[Additional information provided follows:]

During calendar year 1972, the following list of DOD activities have been

relocated from Washington:

Scope of move,

number of

Activity To people

Naval Training Support Command................ _ NAS Pensacola, Fla .................... 81

Air Force Technical Applications Center-.....-- ......-- - Patrick Air Force Base, Fla.---------- - . ..650

U.S. Army Petroleum Center-........................-. New Cumberland, Pa .............. .. 75

Defense Investigative Service, element ................. Fort Holabird, Md 136

U.S. Army Medical Bio-Mechanical Research Lab.. . Fort Detrick, Md _ _ - _ _ _ _ _ _ _ _ - 48

U.S.Army Medical Department Historical Unit. ------------...do ........ .... 51

U.S. Army Health Data Systems Agency ..---........ . do .....----------- 71

Total...---------------------------------.........................----------------------------------- .....1,112

Since January 1972, no new Defense activities have come into the National

Capital region.

Mr. LONG. An awful lot of people seem to meet that overwhelming

requirement.

Mr. SHERIDAN. No, sir, I do not think so.

Do you have a figure on that ?

Mr. KERR. No, I do not have the figure with me, but it is considerably

less this reporting period than it has been in the past, I assure you.

Mr. LONG. What are your goals for relocating space and people out

of the National Capital region, and when do you expect to meet them?

Mr. SHERIDAN. Our main goal still remains 2 million square feet of

administrative space. That equates to about 13,000 people.

The cost of relocation is very expensive, not only because of facility

preparation, but because of personnel relocation, hiring, and retrain-

ing. We want to make the relocations as economicial as possible.

We hope, in the next 5 years, to be able to meet that 2 million square

foot reduction of defense space in Washington.

Mr. LONG. Two million square feet, out of how many ?

Mr. KERR. About 20 million square feet of administrative space, I

believe.

Mr. LONG. So it would represent about a 10-percent cut?

Mr. SHERIDAN. Ten percent.

FUTURE BASE REALINEMENTS

Mr. LONG. The committee notes several types of facilities which,

even with the large base closures which have been announced, still seem

to be underutilized. Do you expect further base closures in fiscal year

1974?

Mr. KERR. We agree that there is a possibility that some of our bases

are not being completely used even after our recent closure and realine-

ment action. We fully expect to continue our program of evaluating all

our bases. It is possible that as a result, adjustments could occur in

fiscal year 1974.

BASE REALINEMENT ACTIONS SINCE 1969

Mr. LONG. Insert in the record a summary of the base realinement

actions since 1969.

[The information follows:]

Announced DOD installation and activity realinements, reductions, and closures

January 1, 1969-April 17, 1973-Summary

Number of actions---------------------------------------------- 2, 269

Personnel positions ---------------------------------------------497, 700

Eliminated:

Military ----____ ____ (302, 600)

Miltar------------------------------------------------(32 0

Civilian ______ ______--------------------------- (195,000)

Annual savings (billions) ---------------------------------------- $4.4

REDUCTIONS IN BASES OVERSEAS

Mr. LONG. What major reductions have we made in overseas bases,

excluding Southeast Asia, in the last few years?

Mr. SHERIDAN. Mr. Chairman, an Army division has been removed

from Korea. The Air Force has significantly reduced the numbered

air forces in Europe.

Of course the committee is well aware of the reduction in Southeast

Asia. Those are the substantial reductions.

Mr. SIKES. Give us the data on the base structures themselves, the

reduction in base structures and what has happened to those bases.

Mr. SHERIDAN. Yes, sir.

[The information follows:]

Excluding South Vietnam and Thailand, there were 249 overseas actions taken

in 19 foreign countries and areas overseas. These actions will result in the re-

duction of over 56,400 military personnel positions and almost 41,400 civilian

personnel positions when completed. The reduction of annual Defense expendt

tures attributable to these actions is about $673 million. Included in these actions

is the closure of 235 installations, activities, and properties used by the U.S.

forces overseas.

U.S. FORCES OVERSEAS COMPARED TO 1964

Mr. SIKES. What is the overall picture on our foreign base struc-

ture over the long term ? How do the number of U.S. personnel sta-

tioned abroad as of last June compare to that figure for 1964, before

the United States became heavily involved in the war in Southeast

Asia?

Mr. SHERIDAN. The matter of overseas bases is part and parcel of

the U.S. forces required to be overseas as part of the national strategy

and policy. As such over the long term, the base structure is a function

of that policy. If that strategy or policy changes, our base structure

will be changed accordingly. However, within this framework we re-

duce, consolidate, or close administrative, logistical, command, and

other such installations and activities. We are satisfied that our effort

to reduce activities overseas has been successful and that not all of

this effort has been related to reduction in South Vietnam. For in-

stance, on June 30, 1968, there were 1.2 million DOD active duty mili-

tary personnel, including those afloat, stationed overseas. On June 30,

1972, U.S. military strength abroad had been cut by 50 percent to

less than 600,000. However, this is about 120,000 below the U.S. mili-

tary strength overseas on June 30, 1964.

FUTURE REDUCTIONS IN OVERSEAS BASES

Mr. SIKEs. The disposition of troops overseas is obviously a matter

for the National Security Council and the Congress to decide. How-

ever, your office does have a job to do to insure that our utilization of

our foreign installations is efficient during peacetime as well as cap-

able of supporting contingency requirements.

Have we wrung all the. vater out of our foreign base structures?

Have we closed all that can be closed under the present circumstances?

Mr. SHERIDAN. No, sir. We do not feel that we have wrung all the

water out of the current overseas base structure. We have a number

of specific studies currently underway in the three military depart-

ments and we are now starting on an overall study for Defense as a

whole.

It is quite a ripe target for reduction.

Mr. SIKES. When would you anticipate some results from these

studies?

Mr. SHERIDAN. Some will be completed in a matter of a few months.

Mr. KERR. Yes, in a few months. The overall study, I would expect,

is just being initiated so we have to have 6 or 8 months on that.

Mr. SIKEs. This committee wishes to be kept informed on any

changes in the overseas base structure.

Mr. SHERIDAN. Yes, sir.

Mr. SIKES. Then would you tell us for the record, in order to pro-

vide more information for those who are interested, what happens

when a foreign base is closed, what happens to the base itself.

Mr. SHERIDAN. In most of the areas that we are occupying now over-

seas, the facilities revert to the host country. I think that is generally

true.

Mr. SIKES. What compensation do we get and under what cir-

cumstances ?

76

Provide that for the record, and bring us up to date on what hap-

pened in France.

Mr. SHERIDAN. Yes, sir.

[The information follows:]

In general, we do not receive any compensation for the property we release

overseas, since the property belongs to the host country. In some cases, we are

entitled to a residual value compensation based upon the facilities constructed

on the property paid for by the U.S. forces with U.S. dollars. This residual value,

however, is usually offset by the estimated restoration costs to restore the

property to its original condition as required by agreement, which usually in-

volves a complicated formula. This is true in Germany, but up to the present time

agreement has not been reached between the United States and the Germans as to

the formula to be applied. This is currently under negotiation with the Germans.

It should also be noted that in many cases of releases of property used by the U.S.

forces overseas, the host country provides offsetting funds for construction

of facilities still required by the U.S. forces on a quid pro quo basis for the

property released. This is true in aJpan and Okinawa where we are consolidating

our activities and releasing property. It is also true, but to a somewhat lesser

extent, in Germany.

With regard to your question on the status of the U.S. claims against France

for the facilities vacated at French request, the following information is

provided.

In 1966 France withdrew its forces from the NATO integrated command and

required NATO and U.S. NATO forces to leave France. In 1968 the move-out

completed and the U.S. Embassy, Paris, filed U.S. Government claims with the

French Foreign Ministry. NATO also filed a claim for $293 million with the For-

eign Ministry. Both claims were based on a legal theory of loss of the use of facili-

ties during their remaining life. Despite repeated inquiries by the U.S. Embassy,

the French had not responded to the U.S. claim when French Minister of State for

National Defense, Michel Debre, visited the United States in 1972. Secretary of

Defense Laird asked Debre's assistance in securing a more forthcoming attitude

by the Government of France, and stressed his personal knowledge of great con-

gressional interest in securing compensation. He also related the ability of the

United States to maintain large numbers of forces in Europe to the demonstration

by Europeans allies of their practical support of U.S. presence.

In October 1972, discussions between the Deputy Secretary of State, Mr. Irwin;

the Assistant Secretary of Defense, Mr. Nutter and M. Herve Alphand, Secretary

General of the Foreign Ministry, were held in Paris. In December 1972, the

French made an initial offer to settle the claim rapidly on a lump-sum basis as a

political matter rather than engaging in lengthy negotiations over the legal

basis of the claim. U.S. negotiators agreed that a political settlement would be

acceptable if the sum could be agreed upon. Negotiations are continuing.

NAVY'S OVERSEAS HOMEPORTING PROGRAM

Mr. SIKES. How does the Navy's overseas homeporting program

affect the total picture?

In other words, is it relatively large or relatively small in its effect

on our overseas population ?

Mr. SHERIDAN. Mr. Chairman, except for Japan, where we will in-

crease the Navy's presence due to the forward deployment of the

carrier task force, the other approved homeporting plans will affect

the overall picture very little.

The carrier task force scheduled for the Mediterranean results in

only a very slight increase in U.S. military personnel presence since

the ship's forces are already included in the overseas count.

We will add some dependents to the overseas areas, but that is the

primary purpose of the homeporting concept, to reduce the separation

of Navy families.

Mr. SIHES. That has been a very serious matter, particularly for

the Navy ?

Mr. SHERIDAN. Yes, sir, it has been.

Mr. SIKES. This committee, I think, applauds the efforts that have

been proposed and what has been accomplished in dealing with these

problems.

FUNDING OF FISCAL YEAR 1974 REQUEST

More than $120 million of the cost of fiscal 1974 program is being

absorbed through various financing adjustments. The Army, for

instance, has $42 million from various savings, recoupments of funds,

reimbursements which it can apply to the fiscal 1974 program to

reduce the new budget authority being requested.

HISTORY OF FINANCING ADJUSTMENTS

Supply for the record a tabulation showing the amounts which

have been made available in a similar fashion in the past 5 years and

the amounts absorbed through congressional reductions in unobligated

balances in each of these years.

Mr. SHERIDAN. It is my understanding that the OSD comptroller

will furnish that data and will have it included in the record.

Mr. SIKES. All right.

[The information follows:]

MILITARY CONSTRUCTION FINANCING ADJUSTMENTS

[In millions of dollars

Additional

As submitted congressional

by DOD adjustments Total

Fiscal year:

1969 -------------------------------------------.... 25, 564 120, 140 145, 704

1970...---.............---------------------------------------- 125, 305 47, 600 172,905

1971----------------.......---------------------------- 25, 149 39, 459 64,608

1972 -------------------------------------------.... 34,613 7,717 42,330

1973................................-------------------------------------------- 71,814 177,044 248,858

Mr. SIKES. Is there a likelihood, insofar as you can now determine,

that further cost savings or financing adjustments will be available so

that this committee can apply them to reduce the amount of new ap-

propriations required ?

Mr. SHERIDAN. The OSD Comptroller is developing that information

and will provide it at the same time that they make their appearance to

discuss the status of funds.

RECOUPMENTS OF CONSTRUCTION FUNDS DUE TO BASE CLOSURES

Mr. SIKES. I note that the Navy, as a result of base closure actions,

appears to have more than $35 million worth of projects which were

provided in prior years, but which may not now be required.

Provide for the record the amount of dollars to be recouped from

projects expected to be reduced or canceled because of the base realine-

ment and Army reorganization packages.

[The information follows:]

Currently, the following amounts are estimated to be recouped from projects

expected to be reduced or canceled because of the base closure/realinement and

Army reorganization:

[in millions of dollars]

DOD component Active forces Family housing Tota

Army .......................------------------------------------------------- 0.3 2.6 2.9

Navy------------------------------------------------- 14.5 26.3 40.8

Air Force....----------------------------------------------- .5 4.3 4.8

Total..................................... ------------------------------------------15. 3 33.2 48.5

ARMY REQUESTS AT SMALL BASES BEING STUDIED

Mr. SIKES. The Army is requesting projects at various small installa-

lations for which they admit they are studying the long-range require-

ment. If some of these bases should be reduced or closed, will that not

mean a reduced requirement for new obligational authority ?

Mr. SHERIDAN. Mr. Chairman, until the studies are completed, the

current valid construction needs must be recognized and met.

After the completion of the studies, if it appears that any of the rela-

tively few installation are not required, the funds requested for these

bases would not be used to construct at those locations.

Mr. SIKES. Tell us whether that means there can be a reduction in

those instances.

Mr. SHERIDAN. Yes, sir.

Mr. SIRES. Provide details for the record on what these funds will

be used for.

[The information follows:]

Of the $64.1 million of Southeast Asia military construction funding unobli-

gated, $37.7 million is presently programed against specific projects. This work

is either under design or being processed for contract at this time. Included are

portions of the remaining LOC program to upgrade the primary highways in

Vietnam and projects to improve the RVNAF self-sufficiency. The remaining un-

obligated funds are being held against unforeseen program adjustments or addi-

tional projects in support of the Vietnamization effort. These remaining bal-

ances are being consolidated and any proposed use of these funds requires prior

approval of OSD.

Mr. SIKES. You mentioned a recoupment of $23.8 million of South-

east Asia funds this year. What unobligated and unexpended balances

does this leave in this area ?

Mr. SIERIDAN. This leaves $64.1 million of Southeast Asia military

construction funding unobligated and $80.5 million unexpended.

CONSTRUCTION COSTS

Mr. SIKES. What success has the military had in awarding contracts

in the past year ? Has there been strong competition; have you gen-

erally been able to award contracts at or below the estimate? What

is the general picture?

Mr. SHERIDAN. In general, the services are successfully awarding

construction contracts. There will be very few instances where new

authorization will be required. We will develop this more specifically

with the services and submit it with your permission in the record.

[The information follows:]

The fiscal year 1974 authorization contains a request for $3,620,000 of defi-

ciency authorization and, as of the moment, there appear to be only three other

projects amounting to $3,284,000 which we are considering for inclusion in the

fiscal year 1974 program. Any subsequent deficiencies will in all likelihood have

to await the fiscal year 1975 program.

Mr. SIKEs. I have noted that there appears to have been greater

success this year than in the immediate past in awarding contracts.

The bidders are in the ballpark more than usual. Is that true?

Is it because of strong competition or is it because the estimates are

more generous than they have been before ?

Mr. SHERIDAN. I think the more realistic estimates that have been

developed in the last 2 or 3 years, as well as the competitive spirit in

the marketplace, have contributed to getting the projects awarded

within the funds available.

Mr. SIKES. What are OSD guidelines to the services as far as the

amount of cost increase which has been included in the fiscal year

1974 program ?

Have these been interpreted uniformly by the services?

Mr. SHERIDAN. The OSI) guidance to the services for costing the

projects in the fiscal year 1974 program is contained in the DOD

Military Construction Cost Review Guide for fiscal year 1974. This is

annual guide issued by my office. It reflects military bid experience and

projected building costs, as well as unit cost estimates for selected

repetitive type permanent facilities. Additionally, construction cost

indexes are included for the different geographic locales and are related

to Washington, D.C., with a cost index of 1.0.

The Cost Review Guide makes it clear that it is not to replace the

seasoned judgment of the experienced estimators-it is merely a cost

review aid, and as such has been very helpful to the services. It is my

understanding that this guide has 'been interpreted uniformly by

the services even though the actual methodology varies. For example,

both the Navy and the Air Force use bid price experience (which is

reflected by the unit costs included in the Cost Guide) which is then

factored from January 1 to the time of contract award for anticipated

cost growth. The Army uses the same base as a starting point, and

then adds the anticipated cost growth from July 1 to midpoint of the

construction.

The Cost Review Guide is based on January 1 cost data-which re-

flects bid experience escalated to the January 1 date. Inasmuch as bid

data is based on anticipated actual costs to midpoint of construction,

the Navy and Air Force method in factoring the base data to the time

of contract award, is virtually the same as the Army method of

going from a starting point of 6 months later (July 1 to January 1)

to midpoint of construction. The important thing is that the experi-

ence with each method is satisfactory to the construction agency

involved.

Mr. SIKES. What are the projected and actual increases in the cost

indexes over the period to which these cost increases have been applied ?

Mr. SHERIDAN. At the time this program was developed, it was

spected that the cost growth would average about 13.5 percent for

the projects involved. The actual cost growth since that time and

uptil last month, April, was already 12.6 percent. A continuance of

20-192 (Pt. 1) 0 - 73 -- 6

that trend would result in the eventual realization of a cost growth

amounting to approximately 19 percent.

If that happens, the funds requested in the 1974 program would

fall short of the requirement by about 5.5 percent.

The military departments recognize this and are taking appropriate

action in their design instructions to accommodate this potential

situation.

Mr. SIXES. I would like to have for the record, for the past 5 years,

the projected cost increases and the actual cost increases.

[The information follows:]

The projected and actual cost increases for construction for the past 5 years

are as follows:

Construction cost increase

(in percent)

Calendar year Predicted Actual

1973 ...........1 10.0 (5)

1972----------------------------------------------------------------- 911.6 (

1972... . . -....-..- - - -~. 9.6 8.

1971 ------------------------------------------------------------- 12.6 16.1

1970------.. .------.......----....... ................ .......... .............---------------- 7.7 8.0

1969.....------....-------...--..----- 0.......... .......... ......... .... .. . 6.2

I At the time of budget preparation, this increase was predicted to be 8.5 percent.

2 As of July 1, 1973 the cumulative increase in the cost of construction for calendar year 1973 amounted to 4.9 percent.

BOLLING/ANACOSTIA

Mr. SIKES. What are your long-range plans for the utilization of

Bolling/Anacostia ?

Mr. SHERIDAN. The plan for Bolling/Anacostia proposes a con-

tinued development of the existing triservice support facilities, with

enlisted man dormitories, a mess hall and support facilities.

The construction is planned to cover a 15-year period. The con-

struction planned for this summer is for the portion south of an ex-

tension of Portland Street. The further development of the north end

will take place over the longer period.

We have substantial Air Force administrative space proposed in

the amount of 900,000 square feet, as well as a greater amount of DOD

administrative space, 1.4 million square feet.

An industrial-technical area is planned for the base civil engineer-

ing, motor vehicle maintenance and fueling, open storage, warehous-

ing, an exchange service gas station, carrier center, a major PEPCO

substation, and the existing Naval Photographic Center. Included also

is a 30-acre reservation for the D.C. National Guard function as well

as the Navy-Marine Corps Reserve training facility jointly called the

Armed Forces Reserve Complex. In addition, the U.S. Coast Guard

will maintain a relatively small operation on something less than 10

acres. The balance of the tract will be made up of housing for both

officers and enlisted men. Serving this housing, as well as military

personnel living in the surrounding community, will be a community

center. One elementary school site, a junior or senior high school site,

and a lineal park along the river's edge are proposed. 190 acres are

occupied by the Executive Flight Detachment which provides heli-

copter support for the President.

STATUS OF FAMILY HOUSING-BOLLING/ANACOSTIA

Mr. SIKEs. What is the status of the family housing which has

been provided in prior years at Bolling/Anacostia ?

Mr. FLIAKAS. In the 1972 program, 550 units were authorized; 150

for the Navy and 400 for the Air Force. The authorization for those

projects would have expired last January; however, the authoriza-

tion was saved by the awarding of some utility work.

Mr. SIKES. Was any additional authorization required on those,

on the housing?

Mr. FLIAKAs. In the 1973 program, another 600 units was author-

ized but only 150 are to be sited at Bolling, the balance are to be at

Cheltenham. The Air Force was also authorized an additional 400

units to be sited at Bolling.

So this makes for a total of 1,055 in the combined 1972-73 program

which are planned for siting at Bolling. We hope to advertise those

this summer and award them in coordination with an environmental

impact statement, and of course with the National Capital Planning

Commission which has to review and approve it.

Mr. SIKEs. Is that a realistic hope ?

Mr. FLIAKAS. Yes.

As you know, we have had obstacles in the past. But we are com-

plying with the requirement to file an environmental impact state-

ment, and we hope we will be successful.

Mr. SIKES. You do not feel increased authorization would be

required ?

Mr. FLIAKAS. Not at this time.

Mr. GERBER. There is one potential obstacle that we are sweating

out, Mr. Chairman. That is, the finalization of the environmental im-

pact statement, which has to do, of course, with the sewage facilities,

the expansion of Blue Plains Disposal Plant.

Mr. SIKES. All right, gentlemen. Let's recess our hearing until 2

o'clock.

AFTER RECESS

Mr. SIKES. When we adjourned this morning, we were talking about

Bolling/Anacostia and related items, including surplus property.

DEFENSE LAND EXCESS IN ANACOSTIA AREA

What has the Department of Defense proposed in the way of ex-

cessing Defense land for community uses in this area ? That does not

apply just to Bolling/Anacostia.

Mr. SHERIDAN. Mr. Chairman, within the Bolling/Anacostia tract

itself, Defense studies have determined that all of the land will be re-

quired for Defense's current and projected needs.

*: However, with the successful-

Mr. SIKEs. Of course, there has been agitation for a long time to

make that available for other purposes. Congress repeatedly has

expressed the desire that it be retained for Defense purposes. I take it

that the Department concurs in the congressional position on this.

Mr. SHERIDAN. Yes, sir.

With the successful construction of the currently authorized fam-

fly housing and the proposed Reserve facility center at Bolling/Ana-

costia, we will be able to declare excess the Camp Simms tract, which

is off-base, the Wilburn housing tract, and the Marine antenna site on

the St. Elizabeth Hospital grounds. These tracts total some 54 acres,

and it is likely-

Mr. SIKEs. Fifty-four acres out of how many?

Mr. SHERIDAN. Fifty-four acres off-base compared to 915 acres on

the Bolling/Anacostia tract.

The GSA will probably make this available to the District of Colum-

bia government if that agency, GSA, determines it is the best inter.

ests of the Federal Government.

That is the only planned disposal or excessing that we have in that

general area.

Mr. SIKEs. What about other Department of Defense property in the

District of Columbia or the immediately surrounding area? Are there

any plans to excess any of that ?

Mr. SHERIDAN. The other that I mentioned is in the Anacostia area.

Mr. SIKES. What about Defense Department land other than that

in the Bolling/Anacostia area ?

Mr. KERR. I know of none now, although there are certain studies

going on that could conceivably throw some land in Northwest Wash-

ington in excess. Aside from that, I do not know of any.

Mr. SHERIDAN. We do not have any plans right now to dispose of

anything.

RELOCATION OUT OF WASHINGTON

Mr. SIKEs. We have discussed with departmental witnesses a num-

ber of times their plan to move Defense programs out of Washington.

What is the status of that program ?

Mr. SHERIDAN. We are still aiming toward a goal of the removal of

2 million square feet, which involves around 13,000 people.

Mr. SIKES. How much progress did you make during fiscal year 1973

toward that goal?

Mr. SHERIDAN. Very slow progress.

Mr. SIKEs. Do you anticipate any in fiscal year 1974 ?

Mr. SHERIDAN. Yes.

Mr. SIKES. How much ?

Mr. SHERIDAN. We should get about 500,000 to 600,000 square feet

targeted for removal out of Washington in that period to get our 5-

year goal of 2 million.

Mr. SIKES. Will you spell that out for the record ? We will go into

more detail when the assistant secretary has been appointed and

approved.

Mr. SHERIDAN. Yes, sir.

[The information follows:]

Mr. Sheridan. The milestones for attaining the objective of relocating 500,000

square feet from the Washington area are currently being developed for apl-

proval by the new Assistant Secretary of Defense-Installations and Logistics-

and ultimately the new Secretary of Defense. The committee will be advised

when these milestones have been approved.

Mr. SIKES. This has been a very slow process.

Mr. SHERIDAN. It has been very slow. In the past year, it has been

extremely slow.

Mr. SIKES. There is almost no way to get people to move out of

Washington, is there ?

Mr. SHERIDAN. I think across the board, governmentwide, we could

do a better job, but this pertains only to Defense activities.

Mr. SIKES. Why is it so difficult to move people out of Washington ?

Does everybody want to be close to the throne ?

Mr. SHERIDAN. There are an awful lot of agencies that by law have

to be here.

Mr. SIKEs. There are also an awful lot that do not have to be here

by law.

Mr. SHERIDAN. Yes, sir. There is a reluctance to move out of

Washington.

Mr. SIKEs. That is a vast understatement.

Mr. SHERIDAN. But part of President Nixon's overall program is

and has been in this direction. The decentralization out to the local

communities should help if it is carried out properly.

BOLLING/ANACOSTIA

Mr. SIKEs. If you proceed with your current long-range plans, will

Bolling/Anacostia be a closed or an open post ?

Mr. SHERIDAN. We expect it will be an open post. However, as at

any military base, if there is a major demonstration or civil unrest,

the base commander may find it necessary to close the post.

Mr. SIKEs. He will have that authority?

Mr. SHERIDAN. Yes, sir.

Mr. SIKEs. Provide for the record a definition of closed and open

post.

[The information follows:]

A closed post is one to which acess is limited to those individuals having

certified clearance as issued under the authority of the installation commander.

A closed post may be established if one of the following characteristics prevails

on the installation:

(1) Possesses or supports operational resources having national security

implications.

(2) Is confronted by a highly significant and unique local security threat.

(3) Has excessive pilferage problems.

(4) Has features or activities that are significant public safety hazards, when

adequate protection cannot be afforded by controlled areas.

An open post is one which, under normal conditions, has no restrictions on

the flow of individuals into and out of the installation.

EXECUTIVE ORDER 11508 REAL PROPERTY SURVEYS

Mr. SIKES. What is the status of the Executive Order 11508 real

property survey program?

Mr. SHERIDAN. Since February 1970, we have accomplished 295

installation surveys involving over 14 million acres of land, which

resulted in the release of over 975,000 acres of that land.

Also, as part of the normal management of real property process,

the DOD approved for release under Executive Order 11508. 208 ad-

ditional special projects representing over 106,000 acres of land.

The total effort, including the General Services Administration

installation surveys, since January 1970, covers 773 surveys and in-

volves 19.2 million acres of land and 660 property actions whereby

the DOD has agreed to release over 1,164,000 acres of land, with the

vast majority of this effort concentrated in calendar year 1972.

Of the total land that DOD agreed to release, approximately 122,000

acres, involving 209 separate parcels, are in the urban areas.

During this same period, 332 separate actions representing 218,075

acres were forwarded to the appropriate committees of Congress,

which have cleared for disposal 284 actions consisting of 180,592 acres

of DOD excess lands.

Mr. SIKES. Has the Department of Defense given up under this pro-

gram any land which it needs for long-range mobilization, Reserve

training, or other foreseeable uses ?

Mr. SHERIDAN. It is the Defense objective to insure not only that its

real property is sufficient and adequate to support necessary missions

over the long term, but also that it is not holding property unneces-

sarily. We do not consider that we have agreed to release any property

which is required for long-term mobilization, Reserve training, or

other foreseeable needs.

Mr. SIKES. To what uses have the lands which you have excessed

been put ? Give us some good and bad examples.

Mr. SHERIDAN. It is difficult to cite for you some bad examples, since

it is the responsibility of the GSA to dispose of excess DOD property

and we do not monitor the disposals that closely once we forward the

disposal reports to the GSA. Offhand, however, I would say bad exam-

ples are those which delay or prevent the effective use of our excess

property for the public benefit. As for good examples, we have the

President's legacy of parks program which involves not only Defense

lands but that of other Federal agencies.

As of April 9, 1973, the President's Property Review Board has

announced as part of the legacy of parks program the transfer of 290

properties in 50 States, plus Puerto Rico. These properties consist of

approximately 49,853 acres, with an established fair market value of

$141,003,176.

Of the 290 properties, 154 (53 percent) were formerly Department of

Defense properties representing approximately 26,856 acres (54 per-

cent), with an estimated fair market value of $96,816,070 (69 percent).

The 154 former DOD proyperties are located in 34 States and Puerto

Rico, led by California, with 25 parcels, representing 7,607 acres, with

an estimated fair market value of $50,078,600.

EFFECT OF DOLLAR DEVALUATION

Mr. SInEs. What has been the effect of the dollar devaluation on the

military construction program ? Give us a short answer now and addi-

tional details for the record.

Mr. SHERIDAN. The most dramatic effect, of course, has occurred in

the NATO infrastructure program, where there are large unliqui-

dated balances which are affected by dollar devaluation.

This committee has been requested by the Office of the Comptroller

to approve reprograming of $20.65 million during this fiscal year to

cover the problem for the rest of 1973 fiscal year.

It is my understanding the committee will hold hearings at which

more detail can be provided.

Mr. SIDES. That is correct.

Mr. SHERIDAN. With regard to the regular military construction

program in overseas areas, our experience has not been so severe.

We will give details for the record.

85

[The information follows:]

A current estimate of the impact, in thousands of dollars, of the dollar deval-

uation on our military construction program follows :

Fiscal year-

Program 1973 1974

Army " o . .....$........................... $23,742 $9,603

Military construction(..... 742) (1, 603)

NATO infrastructure..... -...... -------------................. (23, 000) (8, 00)

N avy ..... . . . . . . . . . . . . . . .218 731

Air Force .....................-------------------... ....... -- - -:::- 300 1, 200

Total .................. . ..--. ....... 24,260 11,534

Note: Since the dollar devaluation was announced only a short time ago, the above figures represent preliminary

estimates.

DEFERRED MAINTENANCE

Mr. SIKES. Will you be short of family housing maintenance funds

as a result of devaluation ?

Mr. SHERIDAN. We estimate that devaluation will raise family hous-

ing maintenance costs by $8.8 million this year, and $18.5 million in

fiscal 1974, none of which is in the budget before you.

In practical terms, this means that a reduction in deferred mainte-

nance planned in 1974 will be turned into an increase. We will lose

ground. The only real relief would be through additional funding.

Mr. SIKES. How much additional funding would be required?

Mr. FLIAKAS. We have programed in the 1974 budget a total of $19.7

million to apply against the deferred maintenance backlog. As you can

see, this $18.5 million loss estimated for 1974 will just eat that up

entirely.

Mr. SIKES. Let us be sure we have a clear answer. Look at your

remarks when they come down to you. I want the exact details on how

much additional money would be required for the fiscal 1974 budget

to stay even.

Mr. SHERIDAN. $18.5 million.

AIR INSTALLATIONS COMPATIBLE USE ZONES

Mr. SIKES. What is the status of the air installations compatible

use zone program?

Mr. SHERIDAN. On March 19, 1973, in accordance with the National

Environmental Policy Act, a draft environmental impact statement

on the proposed DOD instruction covering air installations compatible

use zones was published.

This statement was sent to 11 Federal agencies and to 95 State

agencies.

So far, we have received 20 replies from State agencies. Four were

of the "no comment" type, and the other 16 were invariably favorable.

Five Federal agencies have also replied, all favorably.

Based on the responses so far received, a final impact statement

should be available by mid-June 1973. The CEQ guidelines require

that we then wait 30 days before publishing the policy.

The necessity of following the environmental impact statement proc-

ess has delayed the establishment of a definitive program. However,

both the Navy and the Air Force have been working with local zoning

boards and State legislatures to establish zoning that will insure

compatible use.

I understand that none of the land or easements previously author-

ized for this program have as yet been acquired. The Air Force will

address its progress in this matter when it appears before the com-

mittee.

Mr. Kerr, would you like to explain the air installations compatible

use program?

Mr. KERR. Mr. Chairman, we are faced with encroachment on our

airfields. We have been faced with it for a good many years. Finally

we have recognized this problem and are attempting to acquire fee

title.

Mr. RHODES. Is Williams Air Force Base one of the areas that you

intend to do something about ?

Mr. KERR. I cannot specifically say so. I believe it is one of the orig-

inal five that the Air Force is working with.

Mr. SHERIDAN. It was part of last year's program

Mr. SIKES. Do I understand you have not had much success in

acquiring land and easements?

Mr. SHERIDAN. None has been consummated. I am not aware that

it is reluctance to consummate as much as it is the details.

Mr. SIKES. Apparently no one is resisting it, but you have not been

able to consummate any agreements. Is that the picture?

Mr. SHERIDAN. Yes, sir.

PROPOSED LEGISlATION ON LAND EXCHANGE

Mr. SIKES. What is undivided in the proposed authorization bill in

the area of land exchange ? Tell us something about that. Tell us how

it differs from the current authority and why you feel that it will be an

improvement.

Mr. SHERIDAN. I would like to call on Mr. Frank Roche, who han-

dles our real estate, to answer that question, if I may.

Mr. SIKES. Very well.

Mr. ROCHE. Under the provisions of the Federal Property and Ad-

ministrative Services Act of 1949, the GSA has authority to obtain

privately owned real estate in exchange for Government-owned real

property interests and transfer these interests to other Government.

departments.

Because of the provision of section 2676 of title 10, which states

that no military department may acquire real property not owned by

the United States unless the acquisition is expressly authorized by

law, there exists a serious question as to whether the military depart-

ments may acquire property through the GSA exchange route.

A

87

The proposed amendment in the authorization act would amend

2676 of title 10 to make clear that the military departments would not

need separate acquisition authority in those cases where it would be

feasible and desirable to accept certain real property interests ac-

quired under the GSA exchange authority.

Of course, we would plan to report any transactions having a value

in excess of $50,000 to the Armed Services Committees of the Congress

under section 2662 of title 10.

Mr. SIKES. What you are proposing, as I understand it, is authority

which permits you to exchange land by administrative procedure and

by reporting to Congress, rather than requiring legislative action for

each transaction. Is that what you are saying ?

Mr. RoCHE. In each case we must get specific authority, either

through military construction authorization or separate specific

authorization.

We plan to use this authority in cases of unforeseen encroachment

which threatens the operational capability of a particular installation.

Mr. SIKES. Land exchange has not been a major item, has it?

Mr. ROCHE. It has not been in the past, but we see an increasing vol-

ume of these exchanges, initiated in many cases by the owners of the

property. We are now facing instant cases of encroachment on our

bases.

Mr. SIKES. I find there are a lot of people who want to exchange land

they have for some which the Government has. Invariably, they would

be the principal beneficiary. That is human nature.

But there are times when it is advantageous to the Government to

exchange property, and I can understand that. I have seen many ex-

amples of that nature.

For the record, give us some details on such exchanges for the last

3 years.

[The information follows:]

ARMY LAND EXCHANGES, FISCAL YEAR 1971-72

Location Authority Description

1. Golden Gate National Cemetery, 10 U.S.C. 2672 ......... Exchange with State of California for cemetery pur-

San Francisco, Calif. poses-1 acre. Equal value exchange.

2. Anniston Army Depot, Ala ..... 10 U.S.C. 2672 ... . Eliminate encroachment and straighten boundary.

2.29 acres of privately-owned property acquired for

1.34 acres of Government-owned land and 0.14 of an

acre of Government easements.

3. U.S. Army Reserve Center, Fair- 10 U.S.C. 2672.......... To straighten boundary. 0.23 of an acre city-owned land

field, Ill. for 0.31 of an acre of Government-owned land.

Total:

Acquired...............-................. 3.52 acres.

Released.................................... 1.45 acres.

Note: The following tables indicatethe land exchanges of the Army, Navy, and Air Force over the past 3 years:

88

NAVY LAND EXCHANGES, FISCAL YEARS 1970-72

Location Authority Description

1. NAS Brunswick, Maine.......__

2. Naval Base, Newport, R.I.......

3. Armed Forces Reserve Center,

Midland, Tex.

4. Naval Construction Battalion

Center, Port Hueneme, Calif.

5. Portsmouth, Va., U.S.O. Building-

6. Norfolk, Va., Shore Patrol Build-

ing.

7. Naval Amphibious Base, Coro-

nado, Calif.

8. Public Works Center, San Diego,

Calif.

9. Naval Ammunition Depot, Oahu,

Hawaii.

10. Marine Corps Air Stations, El

Toro and Santa Ana, Calif.

11. Marine Corps Air Stations, El

Toro and Santa Ana, Calif.

12. Naval Weapons Station, Seal

Beach, Calif.

10 U.S.C. 2672 ...... --- Acquisition 29 acres in fee at a value of $7,000 though

exchange of 14 acres of Navy land having equal value.

Required for family housing.

10 U.S.C. 2672 _ _ _ Acquisition 8.8 acres in fee at value $26,400 in exchange

for 26.4 acres Navy property of equal value. Family

housing requirement.

10 U.S.C. 2672 ...... Acquire 1.34 acres in fee with value of $16,000 in

exchange for 1.19 acres Navy property worth $5,355.

Reserve center.

10 U.S.C. 2672_ ....... Acquire 0.77 of an acre in fee at a value of $42,000 for

Navy controlled land of same acreage and value.

Navy pier is on COE owned property. Navy exchanged

equivalent of nearby property to own land around

Navy pier.

Public Law 91-440....... Acquire building and 0.49 of an acre valued at $100,000

in exchange for Navy building and 0.918 of an acre

valued at $75,000.

Public Law 89-179 ..... Acquire building and 1.38 acres valued at $85,000

in exchange for Navy owned building and 0.30 of an

acre valued at $85,000.

Federal Property Act Exchange of I acre of land valued at $42,000 for land of

1949, as amended. equal size and value.

Public Law 92-145....... Acquisition of 26.2 acres of land valued at $39,500 for

family housing purposes for Navy land of same

acreage and value.

Public Law 92-545....-.. Acquisition of land for explosive safety criteria. Acqui-

sition incomplete.

Public Law 91-511...... Acquisition of 86.92 acres of land for family housing

valued at $374,000 for Navy owned land comprising

17 acres with equal value.

Public Law 92-545-...... Acquisition of land interests to protect aerial approaches.

Acquisition incomplete.

Public Law 91-511 ..... Acquisition incomplete. Southern Pacific RR. strip runs

through middle of installation approximately 15

acres. Navy needs acquisition for security and safety

reasons.

Total Navy:

Acquisitions........-..-............... ....... 155.90 acres.

Released...---------------------- - 87.01 acres.

AIR FORCE LAND EXCHANGES, FISCAL YEARS 1970-72

Location Authority Description

1. Offutt AFB, Nebr................ 10 U.S.C. 2672 .....-... Exchange of 2.16 acres in fee with the State of Nebraska.

Community facilities on family housing annex.

2. Charleston AFB, S.C-......-.... 10 U.S.C. 2672......... Acquisition of 19.03 acres easement from Georgia

Pacific Corp. for 18.33 acres-easement at no cost for

drainage ditch.

3. Hancock Field, N.Y--........- ... 10 U.S.C. 2672....... Exchange with Knights of Columbus 0.14 acre fee at no

cost. Purpose was to straighten boundary.

4. Eglin AFB, Fla...-.......... .. 10 U.S.C. 2672......... Acquired 0.08 acre-easement from Okaloosa Island

Authority for 0.06 acre-easement in order to relocate

powerline.

5. Altus AFB, Okla.............. 10 U.S.C. 2672 .....---- Exchange at no cost of 1.30 acre-fee at equal value

with private owner to permit relocation of powerline.

6. Nellis AFB, Nev-...... _ ---10 U.S.C. 2672-.-.. ...- Exchange at no cost of 40 acres-fee with Bureau of Land

Management at equal value for air installation

compatible use zone.

7. Eglin AFB, Fla..-.--... ... . 10 U.S.C----.~~.... --.. Acquisition of 14 acres-feeof privately owned land for

recreational facility in exchange for 98acres-feeof

Air Force owned land of equal value.

Total :

Acquired........------------------------------- 76.71 acres.

Released ----.------------------------------- 159.99 acres.

Mir. RI1ODES. In the TWestern States where there is a lot of Federal

land, it becomes very important, and I would hope we could use that

vehicle more often than we have. Is there any reason that GSA could

not actually make the exchange and then hold the land ? Would it be

necessary for the fee title to end up in the armed services?

Mr. ROCHE. GSA will not acquire privately owned property unless

there is a specific determination by a requiring agency of the need for

the land. We feel we do not have the authority to do this now. GSA

will not acquire and hold it for its own account.

Mr. RHODES. I guess GSA is not authorized by law to do that. It

has to declare the land surplus as soon as it acquires it. I think some

legislation is needed along this line, Mr. Chairman.

Mr. SIKES. Yes. I do too. I have no quarrel with the proposal.

NONAPPROPRIATED FUND CONSTRUCTION

How large is the fiscal year 1974 program for nonappropriated fund

construction ?

Mr. SHERIDAN. We reported to the committee, in our semiannual

report, that during fiscal year 1972 projects costing some $87.8 million

were started, and that we anticipated another $50.1 million of projects

costing in excess of $300,000 each would be started in later periods.

Our latest semiannual report, covering the period from July 1 to

December 31, 1972, indicates that an additional $45.1 million of non-

appropriated funded projects were started during that period, and

that another $52.2 million of projects in excess of $300,000 each will

be started at a later date.

In summary, on a fiscal year basis, it would appear that the total

cost of nonappropriated funded projects started annually is in the

range of $80 million to $100 million.

Mr. SIKEs. Is this running about the same as it has in the imme-

diately preceding years?

Mr. SHERIDAN. Yes, sir.

TEMPORARY LODGING QUARTERS

Mr. SIKES. What temporary lodging quarters are to be built in the

next fiscal year compared with the current fiscal year ?

Mr. SHERIDAN. The program for additional temporary lodging

facilities is contingent upon the requirements and the availability of

nonappropriated funds for the purpose.

The military departments have indicated to us that requirements

from this point on will be minimal for this type of facility.

Mr. SIKEs. Are there any in the fiscal year 1974 program?

Mr. MCCREARY. You get into the question of whether it is or is not,

Mr. Chairman. There is a facility out at Walter Reed of about $2

million that fits this definition, but it is also to hold outpatients. It is

not just a temporary lodging facility for people on a transient basis.

It is a question of whether you do or do not call it that.

Mr. SHERIDAN. Which answers your question another way. You asked

how many TLQ's, and we say minimal, but there is one in the 1974

budget.

Mr. SIKEs. How many banks are you building with nonappropriated

funds?

Mr. SHERIDAN. I have Mr. Grafton Nichols, of the Assistant Secre-

tary of Defense (Comptroller) office, who handles that particular

activity , sir.

Mr. NICHOLS. Mr. Chairman, before responding to the question of

why there are so many banks being built, I would like specifically to

identify the source of funds being used to build the banks.

Mr. SIKES. How many banks are you building?

Mr. NICHOLS. In the 1972 nonappropriated funds that the chair-

man referred to, six.

Mr. SIKES. Six banks?

Mr. NICHOLS. Yes, sir.

Mr. SIKES. Are they sponsored by private groups?

Mr. NICHOLS. Yes.

Mr. SIKEs. Is it necessary for you to build banks for them?' I thought

they built their own.

Mr. NICHOLs. That is the point I was about to make.

The banking institutions located on the military installations build

their own banks. Nonappropriated funds of the Department of De-

fense and its instrumentalities are not used to build banks.

Mr. SIKES. You are not building any banks, then?

Mr. NICHOLS. No.

Mr. SHERIDAN. Mr. Chairman, in the report that this committee re-

ceives of nonappropriated fund construction, the banks are included.

It had already been clarified that this is not from what we term non-

appropriated funds.

Mr. SIKES. Then no nonappropriated funds are being used to build

banks?

Mr. SHERIDAN. NO.

Mr. MCCREARY. The term "nonappropriated" is exactly what it says.

We do not get an appropriation for it. However, we list in the report

we send to you semiannually, anything built with private funds.

These banks are built with private funds. Therefore, we listed them

as from nonappropriated funds. We do not associate them with, let us

say, funds that come from the exchange.

Mr. SIKES. That clears it up.

Mr. SHERIDAN. The next report will show clearly that it is pri-

vately financed.

GUIDELINES FOR TURNKEY CONSTRUCTION

Mr. SINES. I would like to have for the record at this point the new

guidelines which the Office of Secretary of Defense is following with

regard to construction by turnkey or conventional techniques.

[The information follows :]

The following policy and procedural guidance relative to the use of

the turnkey procedures (one step competitive negotiation and two

step formal advertising) for the acquisition of facilities were

formulated with representatives of the military departments and

were promulgated by ASD (I. & L.) in November 1972:

DOD POLICY AND PROCEDURAL GUIDANCE FOR THE USE OF ONE STEP COMPETII1

NEGOTIATION (ONE STEP) AND TWO STEP FORMAL ADVERTISING (Two STEP)

PROCUREMENT PROCEDURES IN THE ACQUIsITION OF FACILITIES

I. POLICY

Experience by the Department of Defense with the use of one step competitive

procurement and two step formal advertising procedures in the acquisition of

facilities indicates that these procedures provide for the direct application of

readily available industry expertise and capability in design and construction.

91

This direct participation by industry offers the potential, under appropriate

project and industry market conditions, for the acquisition of facilities at reduced

costs or with improved functional solutions, without sacrifice of the essential

quality and utility of the completed project. It is the policy of the Department

of Defense that one and two step procurement procedures shall be utilized when-

ever evaluation of the nature and conditions pertaining to a particular project

indicate that such advantages will accrue.

II. PROCEDURAL GUIDANCE

The specialized nature of the one step competitive negotiation and two step

formal advertising procedures as applied to construction necessitate the estab-

lishment of guidance for the effective use of these procedures beyond that pro-

vided in ASPR 18-102 and other applicable sections thereof. While the individual

departments have generally established policies and procedural guidance con-

cerning the use of these specialized procurement procedures, the need exists

for a uniform application of policy and of implementing procedural guidance,

as provided herein, concerning the use of these procurement procedures in con-

struction.

A. One Step Competitive Negotiation

One step procedures provide for the competitive evaluation of technical

proposals, with the award decision based on the best value to the Government

for the combination of the evaluated merit of the technical proposal and the

corresponding bid price, rather than the lowest bid price. The procedures re-

quire the use of detailed comprehensive evaluation criteria, which provide

the meaps to competitively evaluate the quality of the technical proposals as

measured by functional, life cycle costing, esthetics and other considerations

as may be indicated. Accordingly, the one step procedures are appropriate for

use in the acquisition of facilities in which a wide variety of acceptable solutions

(affording for example, varying degrees of utility, life cycle cost relationships

and esthetic treatment) are available. It should, however, be recognized that

it is impracticable to include all detail elements of the facility design in the

technical proposal requirements. As a consequence, there will necessarily re-

main design details, normally specified by the Government in conventional de-

sign, which in this procedure will be determined by the contractor on the

general basis of least initial costs rather than life cycle cost or other user con-

siderations. This circumstance must be recognized by and be acceptable to

the sponsor and the constrTlction activity. Finally, the use of one step requires

the development of or availability of the previously mentioned detailed com-

prehensive evaluation criteria for the particular facility type, considering normal

industry standards and reflecting applicable DOD criteria therefor, so that

technical proposals can be prepared on a common basis and evaluation can be

made on an objective basis

B. Two Step Formal Advertising (Construction)

The use of two step formal advertising is considered appropriate in (1) situ-

ations conforming those described in ASPR 2-502, and (2) in situations in which

it is possible to prescribe, through the use of performance specifications, readily

available commercial products and/or expertise which will satisfy the project

requirements. It must be recognized that the two step procedures focus upon

the satisfaction of performance requirements and therefore are most applicable

when the significant requirements can be stated in quantifiable terms. While

similar use can be made of performance specifications in conventional, formally

advertised contracts, the two step procedures have the advantage, when com-

plexities such as the interrelationship of space, equipment, and structures are

involved, of affording to the proposers before the fact clarification and/or ap-

proval of technical concepts. Thus, while the requirement to utilize performance

specifications for facility acquisition does not necessarily require the use of two

step procedures, consideration should be given to such use whenever the com-

plexities of the facility acquisition indicate that contract pricing will be enhanced

by the use of the technical concept approval step.

The procedures require award to the low bidder based upon any qualifying

acceptable technical proposal. Also, the specification of detail, beyond that pre-

scribed by the performance specifications included in the technical proposals, is

left to the discretion of the low-price proposer. The resultant tendency toward

92

minimal acceptable quality and the difficulty of controlling or reflecting life cycle

cost or other user considerations must be acceptable to the project sponsor and

the construction activity.

C. General Criteria

The effective use of either one- or two-step procedures requires the availability

of potential proposer sources who provide similar services or products in the

commercial market, that is, both the necessary design and engineering services

as well as the construction/installation function. Even when such sources have

been identified, it is necessary that the RFTP/RFP documents provide for, in

the form of government furnished conventional plans and specifications, all

aspects of the project beyond those technical proposal requirements which are

consistent with the expertise and capabilities normally and readily available

from the intended proposer sources. In the interest of reducing the costs of the

preparation of technical proposals, it is also desirable to provide any available

Government plans and specifications, definitives, or concepts which constitute

acceptable technical solutions and which the prospective proposers may adopt

and/or modify in their preparation of technical proposals. The intent of both one-

or two-step construction procurements-with the exception of circumstances as

described in ASPR 2-502-should be to minimize the original technical design

and engineering effort which might be required of responding proposers and to

permit the maximum application of existing industry practices, products and/or

designs to the construction project. The facility types provided in Tab A have

been determined to be representative of currently available construction expertise

from industry practice and sources which may be adaptable through one- or two-

step procedures to satisfy defense facility requirements.

D. Procedures for Use of One- or Two-Step Procedures for Construction

1. Sponsor departments and the Defense Agencies-or the respective sponsor

designated program executive managers-shall identify to the appropriate con-

struction agent, through the use of design/construction directives or other cus-

tomary forms of communication, construction projects which the sponsor con-

siders appropriate for the use of one- or two-step procedures. A project of a type

not conforming to the listing of Tab A may be included in order to test the

industry market response, provided that prior approval for this deviation is

obtained from DASD (I. & H.). Additions and modification of the Tab A listing

will be made when data on field experience indicates.

2. The construction agents shall consider the use of one- or two-step procedures

for the construction procurement of projects indicated by the sponsor and for

other projects considered appropriate. The final decision to utilize one- or two-

step procedures for projects conforming to the listing of Tab A, and the extent

of the application of the procedures to the specific project procurement, rests

with the contracting officer responsible for the procurement. In reaching such

decisions, the contracting officer shall consider the following as applied to each

specific project :

(a) The availability of industry standards which are commensurate with

DOD criteria, and which could provide a basis for and will conform to perform-

ance specification requirements for the applicable project elements;

(b) The availability of sources of contract expertise and capability to provide

the intended procurement, in accordance with paragraph IIC herein;

(c) The indication of qualified proposed interest in the specific procurement

sufficient to insure reasonable competition ;

(d) The potential for the use of the indicated one- or two-step procedure, as

compared with conventional, formally advertised fixed priced contracting, to

enhance the phasing of the project construction sequence to seasonal construe-

tion factors.

3. Upon a contrary determination by the contracting officer relative to the use

of either one- or two-step procurement, the sponsor shall be so advised and the

reasons therefore provided. In the use of these procedures the following guidance

will apply :

(a) RFTP's and RFP's shall be reviewed by sponsor representatives for func-

tional adequacy in the same manner as conventional design documents are re-

viewed. The same shall apply to the evaluation booklet required for the one step

procedure;

(b) Step one technical proposals, under two-step procedures shall be reviewed

for functional adequacy by sponsor representatives. Contractual decisions con-

93

cerning the acceptability of technical proposals are the sole responsibility of the

contracting officer.

(o) The opportunity shall be provided for a sponsor or user representative

to serve as a member of the contracting officer evaluation board for one step

procurements.

(d) The contracting officer may cite the authority of ASPR 3-210 for the

use of the one step competitive negotiation procedures when no other nego-

tiating authority is appropriate.

Enclosures.

I. TYPES OF FACILITY PROJECTS SUITABLE FOR USE OF ONE STEP COMPETITIVE PRO-

CUREMENT PROCEDURES

A. Family housing new construction.

B. TLF (TLQ's/Navy lodges/guest houses)-new construction.

C. Bowling alley-New construction (also see item II A7 of two step).

D. Swimming pools-new construction.

E. Industrial lighting projects.

F. New construction in which industrialized (building system) construction

proposals are to be sought, such as for BOQ's, BEQ's, or small training and ad-

ministration buildings. One step procedures should be the first preference for

procurements which seek to exploit existing industry components and systems

for use in military facilities. However, when in the judgment of the contracting

officer the competitive evaluation procedures of one step would be unduly complex

and/or would require unreasonable effort and expense, the use of two step pro-

cedures to accommodate the procurement of industrialized construction concepts

is authorized.

II. TYPES OF FACILITY PROJECTS SUITABLE FOR USE OF TWO STEP FORMAL ADVERTISING

PROCEDURES

A. Industrial Type Facilities

1. Powerplants-i.e., heating plants and gas turbine or diesel electric plants-

packaged type systems wherein "off the shelf" components can be utilized.

2. Incinerators-two categories of use:

(a) Package units.

(b) Major facilities in which advancement of the "state of the art" equip-

ment systems are required.

3. Sewage treatment plant-packaged units.

4. Small general purpose hangars and other aircraft shelters-when stand-

ard commerial building systems or types will satisfy the requirement.

5. Small warehouse and cold storage facilities-when standard commercial

building types will satisfy the requirement.

6. Major shops or depot repair facilities and industrial plant projects-uti-

lizing the two-step procedure for the specified area of equipment and/or process

system installation and the associated interior utility systems. Structural, archi-

tectural and civil aspects of the overall facility would normally be provided

by government plans and specifications.

7. Bowling alley-when function is of paramount importance and sacrifice of

esthetic considerations or compatibility is acceptable; for example, austerity is

desired.

B. Miscellaneous industrial type projects

1. Sprinkler and deluge systems.

2. Electrical switchgear and substations.

3. Boiler conversions.

4. Small air-conditioning projects.

5. Interior fire detection systems.

6. Storage tanks, when standard commercial products will satisfy the re-

quirement and major civil engineering requirements are not involved.

7. Automated material handling systems.

C. Conditional cases

1. Various facility types when performance specifications must be utilized to

accommodate industrialized construction (building system) components and

concepts, and the contracting officer determines that one step procedures are not

Appropriate.

94

2. Commissaries. Previous experience with and market research concerning

the use of two step procedures to procure commissaries does not indicate the

availability of a specific industry expertise or capability for this facility type.

However, the Air Force will again test the industry market with two step

procurement of a commissary in the fiscal year 1973 military construction

program. Pending the analysis of the results of this procurement, the use of two

step procedures for other commissary procurements will require the prior ap-

proval of the Deputy Assistant Secretary of Defense (Installations and Housing).

Mr. SIKES. The committee is pleased to have these guidelines. Have

they worked satisfactorily so far, or do they need modification?

Admiral DILLON. Mr. Chairman, these guidelines were issued last

November after a lengthy working session. Through this procedure

we got good understanding and uniformity.

They have been applied, and we think they are working well. We

have discovered no problems.

GUIDELINES ON USE OF RELOCATABLE FACILITIES

Mr. SIKES. For the record, I would like your guidelines on the use

of relocatables.

[The information follows:]

RELOCATABLE BUILDINGS

In 1970 a policy was developed for use of relocatable buildings in contingency

situations. The policy was reviewed with the chairman of the Committees on

Armed Services and Appropriations prior to signature by the ASD (I. & L.) of

his memorandum dated May 19, 1970.

A DOD instruction on relocatable buildings was prepared during the past

year and submitted to the committee chairmen for review. Following discussions

with committee counsel the instruction was issued on March 12, 1973. (DODI

4165.56).

The instruction draws upon experience gained during the period that the in-

terim policy was in effect and provides the following policy and procedures:

(a) A relocatable building is defined as essentially a highly portable facility,

designed and built specifically for use in multiple locations. Trailers are included.

(b) The relocatable buildings themselves are designated as personal property

as opposed to real property.

(c) Usage is restricted to "interim requirements" which are 3 years or less

in duration. The following exceptions are provided: when military contingency

situation requires, use may be extended with the approval of ASD (I. & L.);

when a permanent facility has been authorized via normal military construc-

tion procedures, the relocatable can be used until the replacement is completed;

and in special circumstances when conditions change and the relocatable is re-

quired indefinitely, retention may be approved by the ASD (I. & L.) (with

congressional notification if the building cost is over $300,000).

(d) An economic analysis is required to substantiate that use of a relocat-

able building is the most cost effective means of satisfying an interim facility

requirement. This analysis is waived if operational time requirements cannot

otherwise be met.

It is expected that the new instruction will provide effective use of developing

building technology in the field of relocatable structures while maintaining ac-

cord with the military construction authorities and limitations.

An annual report of usage and relocatable building disposition is requited

to be provided to ASD (I. & L.).

Mr. SIKES. Tell me briefly whether the use of relocatables is con-

tinning to be satisfactory, and whether it will be expanded or phased

down.

Admiral DILLON. Sir, this new instruction, which is the result of 2

years' monitoring of a temporary instruction issued in 1970-71,

tries to take advantage of the evolving technology in relocatables for

use for short term or immediate needs and still stay within the con-

gressional limitation and authorization.

I have no reason to think it will not work out well. It was coordi-

nated with this committee. It was coordinated with the Services.

As to prediction of future use, it is simply a function of short term,

immediate requirements as they arise.

DEFENSE DEPOT MAINTENANCE POLICIES

Mr. SIKES. The services are beginning to implement DOD Directive

4151.1. For the record, tell us what it is, and then tell us the status

and how it may affect modernization programs for depots.

Mr. SHERIDAN. Mr. 'Oliver, the Director of Maintenance, Policy, will

respond to that question, with your permission.

Mr. OLIVER. Mr. Chairman, I have a prepared statement on 4151.1

here. If you wish, I can read it.

Mr. SIKES. Provide that for the record.

[The information follows:]

DOD Directive 4151.1 was issued in order to assure that in the planning and

execution of depot maintenance programs reliance was placed on a combination

of both DOD organic and contractor capabilities. In furtherance of this policy

the directive provides guidance as to the amount of organic capability and

capacity that can be established and/or retained, and this amount is related

to the support of mission-essential weapons and equipment. Finally, the direc-

tive provides guidelines for the efficient use of DOD owned and operated depot

facilities.

The provisions of DOD Directive 4151.1 are being applied by the military

departments in planning and review of projected facility requirements. The antic-

ipated impact of the directive must necessarily be viewed in the context of current

and emerging conditions. As you know, with the greatly reduced activity in SEA,

and the reduction of the number of weapon systems in the inventory in many

cases, the gross depot maintenance requirements have been declining. We expect

that consistent with the policy in DOD Directive 4151.1 both organic and con-

tractor workloads will be reduced so that a balanced program utilizing both

organic and contract sources will continue. This reduction in both organic and

contract workloads has in fact been taking place.

Reduction in organic workloads will, of course, tend to reduce the utilization

rate of existing facilities in DOD, and in some cases to a level that yields a mar-

ginal efficiency at best. In order to maintain a satisfactory level of utilization

consistent with the directive, we anticipate, that based on appropriate analyses,

some workloads will be consolidated into fewer facilities, first at specific depots,

then perhaps among depots within a military department, and in some cases

among departments by use of interservicing agreements. Facilities made excess

by this process will be transferred to other uses or inactivated. The utilization

of retained facilities will of course tend to increase.

Be assured, however, that in any case, sufficient capacity will be retained to

assure our ability to meet contingency requirements. Modernization programs

in our opinion will not be greatly affected. Much of the need for modernization

is generated by new weapon systems which require new capabilities to accom-

modate the latest technology in weapons, including perhaps larger more power-

ful engines or more sophisticated electronic equipment, or new testing techniques.

In addition certain current programs for modernization represent the accunu-

lation of a backlog from periods when modernization programs were deferred

for whatever reason. Some modernization however will continue to be re-

quired to provide efficiencies by consolidating workloads into fewer facilities or

relocating capabilities to improve the flow of work. On the other hand any reduc-

tion in the number of facilities will tend to reduce requirements for moderniza-

tion of those facilities.

Tro sum up, the intent of DOD Directive 4151.1 is to assure that the planning

and execution of depot maintenance programs are based on utilization of a

combination of organic and contractor resources, and that DOD organic facilities

are modern, and are efficiently utilized. We expect the effect to be fewer, more

modern DOD organic depot facilities, more efficiently utilized with a reduction

in the cost to support our weapons.

EFFECT OF MAINTENANCE ENGINEERING ON PROCUREMENT AND ON

DEPOT SUPPORT REQUIREMENTS

Mr. SIKES. Now tell us about 4151.16 and the effect that this will

have on DOD maintenance programs and facilities.

Mr. OLIVER. Let me read the objective of this directive:

The objective of equipment maintenance is to sustain weapon and equipment

end item systems in a state of operational readiness consistent with the mission

requirements of the operating or tactical elements and at the least total cost.

That sets the stage. The two paragraphs of 4151.16 I think you will

be interested in are as follows:

Maintenance engineering activities will actively participate in all phases of

the life cycle of weapon and equipment end item systems to assure a balanced

logistic support program and that full consideration is given to logistic support

implications during the conceptual, validation, development, production, and

operational phases of weapon and equipment life cycles in order to minimize

logistic support requirement and cost. Techniques will be developed to measure

effectiveness and benefits of maintenance engineering actions.

The other paragraph:

In planning and acquiring depot maintenance support capability for new

weapon systems, subsystems, and components, the military departments will

seek: First, To achieve weapon system or equipment end item readiness at an

early date; and, second, to reduce the risk of premature investment in logistic

support capability, through the use of phased organic maintenance support for

systems, subsystems, or components which are unstable in design or have a risk

of change.

That means that logistic activities-in this case, maintenance engi-

neering-will play a more active role during the initial phases of the

acquisition of weapon and equipment end item systems. Essentially,

they will participate with the design engineer in evaluating attributes

of a design that will enhance its operational effectiveness and provide

for reduced costs and resources to support the end product when pro-

duced. Experience and knowledge gained from analyses and evalua-

tion of operational systems will provide empirical data to enhance

maintenance engineering participation in the acquisition process and

permit us to avoid those design features which affect sustaining opera-

tional performance and downstream support costs.

As a result of close participation by maintenance engineering activi-

ties during the weapon or equipment end item acquisition process, the

logistician or maintenance engineer will be, at all times, aware of sub-

systems and components of major weapon systems that will not reach

design maturity and will be in an unstable state at the time they are

produced and delivered to the operating forces. Traditionally, due

to the lead time involved, we have acquired a logistic support capabil-

ity for such unstable articles, and it has resulted in unnecessary costs

being incurred as a result of accommodating major engineering

changes in the logistic capability acquired at the time a major weapon

system is delivered. In the future, the acquisition of wholesale supple

and logistic support will be delayed on all unstable subsystems and

components of a major system until design maturity is demonstrate,

through appropriate test programs. During this interim period, whole-

sale logistic support-supply and depot maintenance-will be pro-

vided by the contractor.

Appropriate incentives will be included in such contracts to acceler-

ate the engineering effort and get a stable article some 2-3 years earlier

than has been the case in the past. As a matter of information, today

15 percent of the systems of a major weapon are causing 80-90 percent

of the support costs due to their being unstable. This is the area we

want to place our primary effort in the future.

Another area where we desire to place major emphasis is that deal-

ing with major weapon and equipment end items currently in the DOD

operating inventories. Through continued performance evaluations

and maintenance engineering analyses of present systems in the DOD

inventory, we will be able to have visibility of those areas generating

the highest proportion of support time and costs. Accordingly, we

desire to establish action programs which will tangibly reduce re-

sources currently used or consumed in the area of maintenance sup-

port.

This is particularly important in view of the size and magnitude

of the maintenance program which is the largest single consumer of

dollar and manpower resources in the DOD. Our action programs, in

connection with present weapon or equipment end item systems, will

consist of re-engineering subsystems or components creating the largest

demand; changing maintenance criteria which dictates the scope,

depth, and frequency of maintenance; and/or, in some cases, reorient-

ing our approach and the techniques of performing maintenance by

adopting such methods as "on-condition maintenance," "sectional

overhaul," "condition monitoring" et cetera.

I merely bring out and emphasize the two areas of maintenance

engineering since you and the committee are well aware of our areas

of concentration in improving industrial management in the main-

tenance area. I refer to the establishment and implementation of the

depot maintenance programing system, the uniform depot maintenance

cost accounting and production reporting system, and the facility

modernization programs already established and being carried out

in the area of depot maintenance in the aeronautical facilities and

shipyards.

All of these progams are aimed at our primary objective of sustain-

ing weapon and equipment end item systems in a state of operational

readiness consistent with the operating or tactical elements at the least

total cost to the DOD.

Mr. SIKES. Do you think you are on the right track?

Mr. OIIVER. Yes, sir. We are working closely with the rest of the

OSD staff to get some of these programs started.

Mr. SIKES. When will you begin to see specific results?

Mr. OLIVEn. Some results have already been realized in the indus-

trial management area. However, there is still much work to be done

here. With regard to the maintenance engineering area, we are just

beginning to explore areas that offer an opportunity to provide us the

greatest benefit in the short term. Additionally, we are exploring ways

and means with D.D.R. & E. and the military departments, including

their R. & D. communities, to place a concerted program in the area of

designing military hardware, with major emphasis concentrated on

downstream logistic impacts and costs. This represents a rather dra-

matic change from the past, and we have considerable learning to do

and, of course, last but not least, people must be convinced that the pro-

gram is sound and that real cost benefits are attainable in terms of

reducing the total life cycle cost of sustaining or supporting a weapon

or equipment end item system.

Mr. SIRES. You may expand that for the record, if you wish.

(The information follows:)

By concentrating during the early design phases of a weapon system and

placing emphasis on downstream logistic support, we definitely feel that costs

for maintenance or logistic support will be reduced. This will be a long-term

result; however, during the short term, through concentration on those sub-

systems or components that are generating the largest requirement for sup-

port, we should be able to take actions in terms of method changes, techniques,

or in some cases, engineering changes that will bring about improved sustained

performance and reduction in the requirement for logistic support and correspond-

ing costs. In the industrial area, we are fast getting the visibility of our per-

formance and costs, and will have the basis for bringing about changes that

will reduce maintenance production costs.

In summary, we feel we have three things going for us at one time: improved

mission readiness, reduced cost of support, and, through these reductions, addi-

tional moneys can be made available for acquiring new weapons within a fixed

defense budget.

BID LISTING

Admiral Dillon, what has the Office of the Secretary of Defense

done to explore the possibility of subcontractor listing on a test basis?

Admiral DILLON. You may recall when we appeared before you last

summer, we talked about this subject. We had researched the problem

in great detail then. We found people before us had researched the

problem and came up with the same conclusion, which was that we

might in the first tier control bid shopping, but not those below it.

We have monitored the experience and the results the GSA is

achieving. I read a speech Mr. Sampson gave recently and learned

they are changing their procedures for bid listing. In essence, they

are reducing their coverage from what it was initially. I think they

might have found they were not solving the problem, and it was cost-

ing considerably more in construction management expense.

At the moment, we plan to see how GSA works this out, then see if

we can price it out versus the benefits that might be obtained.

Mr. SIKES. Thank you, Admiral Dillon. I note that you are to re-

tire this year. Having observed your excellent work over the years in

which I have known you, I am deeply grateful for your service. The

committee is particularly grateful for the fine job you have done in

your most recent post as director of construction in the Office of the

Secretary of Defense. You have achieved many things which I feel the

Defense Department will continue to benefit from in the years ahead.

I sincerely hope to continue to see you often and wish you the best

of luck in your future pursuits.

Admiral DILLON. Mr. Chairman, you have always been a very

gracious man.

Mr. SIRES. Mr. Long, do you have any questions?

Mr. LONG. I have some questions for which I would like to have

answers provided for the record.

99

[The questions with answers follow:]

Question. In fiscal 1973 the Defense Department requested $2.66 billion for the

military construction budget, and we appropriated $2.32 billion. This year you

are requesting $2.94 billion, despite the fact that we are cutting down the size

of our bases and the size of our Armed Forces. How can you justify an increased

budget request in a year when health, education, and other programs are being

out back?

Answer. The basic increases over the 1974 MILCON appropriation program

over that contained in the fiscal year 1973 is brought about in basically three

areas: The inclusion of funds in the program for Trident construction, the in-

crease in medical facilities to provide better care for our service personnel, and

the effort to improve the living conditions for the bachelor personnel as part

of the program to obtain the all-volunteer force. The military construction

program, of course, is only a very small portion of the total Defense program

for fiscal year 1974 whose overall limits were the subject of much discussion

with the President during the process of preparation of his fiscal year 1974

budget to the Congress.

Question. What percentage of your fiscal year 1974 military construction budget

reflects the cost of inflation?

Answer. Price escalation is reflected in the fiscal year 1974 military construc-

tion budget on a project-by-project case basis dependent upon the complexity

and expected duration of the construction contract. Defense guidance provides for

the cost estimates to be based on the best estimates of the amounts ultimately

to be paid. When possible, the effects of future prices will be based on specific

data, considering such factors as contract provisions, labor agreements, produc-

tivity and quantity changes, and the extent to which material is on hand, to be

Government furnished or under fixed-price contract. In cases where specific

information is not available, Defense guidance provides that the following indexes

should be used for military construction and family housing :

Fiscal year:

1973 -------------------------------------------------------- 100.00

1974 -------------------------------------------------------- 105. 82

1975 ---------------------------------------- 110.79

1976 -------------------------------------------------------- 116.00

1977 -------------------------------------------------------- 121.45

1978 -------------------------------------------------------- 127.16

1979 -------------------------------------------------------- 133. 14

In general, the projects included in the fiscal year 1974 military construction

budget are based on cost data as of January 1, 1973, escalated to the expected

midpoint of the construction period.

Question. Please provide for the record the annual rate of inflation in military

construction projects for fiscal years 1971, 1972, 1973, and 19714.

Answer. The annual rate of inflation in military construction projects is as

follows :

Inflation

Fiscal year: (percent)

1971 --------------------------------------------------------- 13.1

1972 ----------------------------------------------------------9.8

1973 --------------------------------------------------------- (8. 5)

1974 ----------------------------------------------------------- (2)

'As of May 1973, the ultimate increase is currently predicted at approximately 10

percent.

SIt is predicted that the increase will be approximately 6 percent.

Question. Your statement says that $1.25 billion of your $2.9 billion budget

request is to be spent on military housing in order to improve the attractiveness

of military life to personnel serving in the All-Volunteer Armed Force. What

evidence do you have that increased and improved housing will enhance the at-

tractiveness of military life? The Baltimore Sun recently reported that even the

introduction of a $1,500 cash bonus to young men who signed up for Army and

Marine combat service has failed to bring enough men into those srtvices to meet

recruitment goals. In the first 9 months that the program was launched, (July

197-March 1973), the Army failed to meet its combat arm recruiting goal for

any month. The Marine Corps met its goal in 7 of the 9 months. As a result, the

Defense Department has raised the bonus from $1,500 to $2,500.

100

Are we going to be faced with a similar situation in housing? Are we going to

have to provide luxury housing to keep individuals in the armed services?

Answer. Adequate housing, either in the local community or on-base, is an

important aspect of military life and constitutes one factor affecting the retention

of married personnel. Increased availability of family housing is consistently

ranked high in surveys of military personnel as a primary consideration for

keeping individuals in the armed services.

Department of Defense policy is to rely on the local civilian housing market in

communities near military installations as the primary source of family housing.

Only when community support is limited or inadequate as to cost, distance, or

quality do we seek authority to construct on-base housing. The fiscal year 1974

appropriation request of $1,250.6 million includes $351.9 million to construct

11,688 units at installations where sufficient adequate community support housing

is lacking and $62.5 million to improve the condition of some older and dete-

riorated quarters.

We do not foresee the need to change existing housing programing policies and

we shall continue to rely primarily on community support housing. With regard

to luxury housing, we do not anticipate any situation where it will become neces-

sary to provide unusual amenities in our housing projects. As result of research

on civilian housing design trends and a survey of opinions of our own personnel

we are requesting this year very modest increases in the statutory net area limita-

tions to improve overall liveability. We intend to keep our design criteria com-

patible with average civilian housing as constrained by statutory cost and size

limitations.

Question. On page 14 you begin a discussion of real property surveys. What

is the status of the General Accounting Office proposal to declare nearly 3,000

acres of land excess at Edge wood Arsenal-Aberdeen Proving Ground, Md.?

Answer. We replied to the GSA survey recommendations on March 6, 1973,

and indicated that the Army could release about 2,900 acres of land at these

installations but that since all of this land was contaminated, none could be

released until certified clear of all hazardous material by the Army. Because of

the costs involved in clearing this land to satisfy safety requirements, therefore,

it was considered that no land could be released at this time. The matter is

currently under review by the GSA and the property review board.

Question. Please provide for the record cost breakdown of jobs eliminated,

jobs transferred, including severance and moving costs for the Jefferson Proving

Ground (JPG) action relocation of the acceptance test activities from Aberdeen

Proving Ground, Md. to Jefferson Proving Ground, Mo., announced as part of

the Army reorganization plan in January 1973.

Answer. See below.

Personnel involved:

Space reductions------------------------------------------------ 69

Spaces transferred to Jefferson Proving Ground________-_----------- 73

Cancellation of vacancies________-______________________ 6

Attritional losses------------------------------------------------ 34

RIF------------------------------------------------------------ 0

Retirements -----------------------------------------------------15

Transfer w/function____________________ _________ 40

Separations (refuse to transfer) ________________-___________- . 30

Reassignment __________---------------------------------------------------__________ 17

Overall costs : Aflllions

Jobs eliminated-civilian__ ---------------------------- $0. 257

Severance Pay (30 Pers) _______________________________________ .198

Lump sum leave---------------------------------------------_____________ .059

Jobs transferred-civilian relocation cost -_____________.--_.... .200

Total one-time costs-civilian----------------------------------- .457

Total one-time costs-military ------------------------- _ ----_ 0.

One-time cost-relocation of equipment____________________________ .235

Total overall costs---_ _---------------------------------------- .692

Overall annual savings:

Civilian ,------------------------------------------------------- .94

Military _______ ------------------------------------------------------__ 0.

Total overall annual savings _ _____________--------------------_ .794

101

Question. Please provide for the record details of facilities at JPG and their

suitability for acceptance testing.

Answer. JPG was constructed for highly efficient volume testing of production

ammunition. Its ranges are highly instrumented and laid out for minimum con-

flict between both firing positions and impact areas. At peak Southeast Asia work-

load, JPG tested approximately 1,000 lots of production ammunition per month.

The current work'oad is slightly below 400 lots per month.

The geographical location was selected because it is centrally located among

major producers of ammunition, minimizing both shipping time and cost and test

and supporting ammunition. JPG can fire all types of conventional ammunition

and weapons at ranges up to 20,000 meters, and has not been subject to

encroachment.

The excellent facilities coupled with a highly experienced and proficient work

force combine to make JPG the most efficient and cost effective Army Materiel

Command installation for the acceptance testing of production-type ammunition.

Question. Please provide for the record detailed information on anticipated

additional transfer and transportation costs for ammunition tested by this activity

if located in Indiana.

Answer. The Army does not anticipate incurring additional transfer and trans-

portation costs for ammunition tested, after completion of the move to Jefferson

Proving Ground (JPG) and, in fact, expects to effect substantial savings.

Ammunition fired for acceptance testing is composed of the test component-

for example-a fuze, and standard ammunition components-casing, propellant-

required to fire the test item. Both the test items and standard components are

shipped from various plants to the testing installation, with 17 percent of the

total yearly shipping weight being attributed to the standard components. In the

case of Aberdeen Proving Ground and Jefferson Proving Ground, most of the

standard components, representing the largest part of the shipping weight, are

shipped from plants located in the Midwest, making it more economical to ship

to Jefferson Proving Ground, which is also located in the Midwest. The majority

of the test items, which represent a minor part of the total shipping weight, are

shipped from plants located nearer to Aberdeen Proving Ground, making it more

economical to ship to Aberdeen Proving Ground. The attached table is an example

of the comparative costs of shipping test components and standard components to

the two locations.

Between April 1, 1972, and March 31, 1973, the average number of lots of ammu-

nition shipped for acceptance testing totaled 75 lots per month, or approximately

900 lots for the 1-year period. The yearly shipping weight of a representative 75

lots per month is 23,598c weight-hundred weight-which equates to a cost to

ship the items to Jefferson Proving Ground of $91,399, and a cost to ship the same

items to Aberdeen Proving Ground of $144,109, amounting to annual savings of

$52,710.

REPRESENTATIVE SAMPLE, JUNE 1973

Num- APG cost JPG cost Total cost

ber of -

Test item lots Manufacturing Cornm- Com-

location Test ponent Test ponent APG JPG

Propellant MI, 105 charge M67_ 9 Radford, Va ... $1, 103 $1,202 $1,721 $660 $2,305 $2,381

Propellant Ml, 155 charge M4A . J4 Badger, Wis .... 1,093 668 616 367 1,884 1,174

11 Radford, Va.... 123 .... 191 ...............

Propellant M9, 81-mm charge 5 Canadian Com- 152 668 244 367 820 611

M90Al. mercial.

Propellant M8, 60-mm charge XM- 6 Radford, Va.... 735 810 1,148 440 1,545 1,588

181.

Propellant M6, 155 charge M119.. 2 Badger- --..... 547 534 308 293 1,258 645

12 Indiana...-------. 177 ---.....------ 44 ........--------------------

Total.... ----------------..--... ------------.........----------------------------..................... 7,812 6, 399

Question. The U.S. Army Combat Developments Command was abolished by

the January 1973 Army reorganization. The Command's Maintenance Agency, em-

ploying about 120 civilian and military, has been located and smoothly function-

ing at Aberdeen Proving Ground since 1962. Was any consideration given to mov-

ing that facility during the reorganization? Is any consideration being given to

fjoving it nowt Why, if so? If consideration is being given to relocating this

agency, now a part of the Logistics Center, why were people moved from Redstone

102

Arsenal, Ala., to Aberdeen Proving Ground--l military and 6 civilian-under the

January reshuffling? Please provide an answer for the record.

Answer. As part of the CONUS reorganization, the formation of a strong, cen-

tralized Logistics Center at Fort Lee envisioned the eventual consolidation of all

logistics development activities under one roof for maximum efficiency in address-

ing Army logistics requirements. Transfer of the Maintenance Agency to Fort

Lee is an integral part of this concept as a follow-on action to establishing the

Logistics Center nucleus. A determination of how best, and when, to integrate

the Maintenance Agency into the Logistics Center is still under consideration. The

relocation of the 16 jobs in the Missile and Munitions Division of the Maintenance

Agency at Redstone Arsenal to Aberdeen Proving Ground has been deferred. To

preclude an additional move the jobs will not be transferred until the consolida-

tion of the Maintenance Agency at Fort Lee is accomplished.

COMMISSARY FACILITIES

[The following report and questions were inserted in the record with

the consent of the subcommittee:]

MAY 4, 1973.

Memorandum for the Chairman:

Re military construction program for fiscal year 1974 commissary facilities.

By directive dated February 22, 1973, the committee requested that a study

be made of the commissary facilities requested in the fiscal year 1974 military

construction program.

In compliance with the committee's request, an analysis was made of the pro-

posed construction of commissary facilities at Peterson Field, Colo. (Air

Force) ; at Fort Campbell, Ky. (Army) ; at the Marine Corps Air Station, Yuma,

Ariz. (Marine Corps) ; and at the Naval Station, Adak, Alaska (Navy).

In accordance with the directive, particular emphasis was placed on the possible

use of surcharge moneys for commissary construction. The results of the study

are included in the attached report.

Respectfully submitted.

C. R. ANDERSON,

Investigations Staff,

House Appropriations Committee.

I. INTRODUCTION

A. DIRECTIVE

By directive dated February 22, 1973. the committee requested the investiga-

tive staff to study the military services' requests for commissary facilities in

the fiscal year 1974 military construction program. The directive specified that

the investigation should include, but not be limited to, the consideration given

by the services and the Office of the Secretary of Defense (OSD) to the use of

surcharge moneys for the construction, the services' determinations of require-

ments and priorities for commissary construction; and the present and long-range

projections for sales and/or personnel to be supported by each of the com-

missaries in the fiscal year 1974 military construction requests. The directive

also specified that the study should include a detailed analysis of one of the com-

missaries requested by each service.

B. SCOPE OF INQUIRY

The investigative staff inquired into the policies and procedures employed In

the OSD evaluation of services' requests for commissary construction by the

Offices of the Assistant Secretaries of Defense for Installations and Logistics,

for Manpower and Reserve Affairs, and Comptroller. The study also included

analyses of the services' evaluations of requests for commissary construction

and procedures for preparing justifications, plans, and estimates.

The investigative staff reviewed OSD and the services' policies and procedures

for the collections and use of surcharge funds and gave particular emphasis to

the possible use of surcharge moneys for commissary construction.

The study included detailed analyses of the requests for new commissaries

at Fort Campbell, Ky. (Army) ; Peterson Field, Colo. (Air Force) : and Marine

Corps Air Station, Yuma, Ariz. In connection with these analyses, the Investiga-

103

tive Staff visited the aforementioned installations as well as the Office of the

Air Force regional engineer, Dallas, Tex., and the Naval Facilities Engineering

Command, western division, San Bruno, Calif. A less detailed analysis was per-

formed of the request for a new commissary at the Naval Station, Adak, Alaska.

The study involved interviews with responsible officials of OSD and the

services, analyses of policy and procedures issuances, reviews of base master

plans and preliminary plans and specifications, and reviews of pertinent Con-

gressional hearings and reports.

II. USE OF SURCHARGE FUNDS FOR CONSTRUCTION

A. OSD POLICY

Annual DOD appropriation acts have required that appropriations be reim-

bursed for certain expenditures connected with commissary store operations.

Expenditures requiring reimbursement include those for purchase and main-

tenance of operating equipment and supplies, utilities, and shrinkage, spoilage,

and pilferage of merchandise. These acts also provide that the selling prices of

merchandise shall be increased to provide the revenue needed to pay these ex-

penses. The increase is commonly referred to as a surcharge.

OSD policy requires the services to establish their surcharges at a rate which

as nearly as practicable approximates the expenses required to be paid from

them. The policy also recognizes, however, that it is impossible to establish an

exact balance between surcharge funds collected and funds needed to pay re-

quired expenses. OSD in its interpretation of the appropriation acts allows the

services to use excess surcharge funds for other purposes such as construction

of new commissaries. The OSD General Counsel has ruled that the language con-

tained in the annual appropriation acts prohibits the services from increasing

the surcharge for the purpose of providing funds for commissary construction.

Although all of the services maintain they are complying with OSD policy

which prohibits increases in surcharges for the purpose of paying for the con-

struction of commissaries, all services have expended large amounts of excess

surcharge funds for the construction and renovation of commissaries as shown

later in this report. The extent to which these funds have been used for the above

purposes and the manner in which they have been collected and administered

leads to the conclusion that OSD policy has been circumvented.

A December 22, 1970, report by the Special Subcommittee on Exchanges and

Commissaries of the House Armed Services Committee stated that as a general

rule, funds for the construction of new commissaries should be provided from ap-

propriations. The report recommended, however, that when appropriated funds

cannot be secured, the surcharge be increased slightly to provide the needed

funds.

This recommendation has not been adopted by DOD. OSD officials advised the

investigative staff that the language of the appropriations act would have to

be amended to permit the recommendation to be adopted. Some service officials

advised the investigative staff that they concurred in the recommendation and

would like to see it adopted.

Officials of OSD and all the services advised the investigative staff that they

had considered using excess surcharge funds for the construction of the com-

missaries included in the fiscal year 1974 military construction budget, but that

such funds were not available. Financial statements and officials' explanation

corroborated that excess surcharge funds are not available to pay for the con-

struction of any of the commissaries included in the fiscal year 1974 budget.

B. AIR FORCE

In Army and Air Force commissaries, the shelf price of merchandise is the

same as the cost to the commissary (rounded to the next whole cent) and a

3 percent surcharge is added at the cash register, just like a sales tax would be.

All Air Force surcharge moneys are controlled and managed centrally through

the Air Force Commissary Trust Fund.

The Air Force, as well as the other services, uses excess surcharge funds for

major improvements. On April 25, 1972, the Secretary of the Air Force authorized

expenditure of $5.2 million for the construction of two new commissaries, a

medium-sized commissary at Williams Air Force Base, Ariz., and a small-sized

commissary at Mountain Home AFB, Idaho, and three major renovations. Ac-

carding to an Air Force official these two commissaries will be the first new Air

Force commissaries built with excess surcharge funds.

104

During fiscal year 1972, the Air Force commissary trust fund collected $25,-

378,200 from its 3 percent surcharge. (It is to be noted that an additional 1 per-

cent surcharge would have provided in excess of $8 million which would have

more than provided ample funding for the three new commissaries requested in

the Air Force fiscal year 1974 military construction program.) Total obligations

of $26,014,600 were incurred in fiscal year 1972 which included $4,359,200 for

minor construction and an additional $2,884,600 for equipment related to minor

construction.

The unobligated balance of the Air Force commissary trust fund through Febru-

ary 28, 1973, was $14,128,900 but this balance did not include commitments of

$7,475,100 for minor construction and $5,788,300 for equipment related to minor

construction, or a total of $13,263,400. Thus, the uncommitted balance as of

February 28, 1973, was actually $865,500.

C. ARMY

As with the Air Force, the Army's surcharge is 3 percent added to the customer's

bill at the cash register with the surcharge moneys being controlled centrally

through the commissary surcharge fund account.

The Army's plan for the surcharge fund for fiscal year 1973 shows expected

collections of $21.1 million, regular expenses of $20.4 million, and construction

projects of $3.7 million. An opening balance of $6 million and a contingency reserve

of $1 million should result in a closing uncommitted balance of $2 million. This

amount is approximately equal to the amount which will be needed for new

equipment for the three new commissaries requested in the fiscal year 1974 mili-

tary construction program.

Since January 1970, the Army has funded from the surcharge fund 29 com-

missary construction projects over $50,000 at a total cost of $15.7 million. The

largest amount spent on a single project was $3.781 million for a new commissary

at Fort Benning, Ga.

D. NAVY

The Navy has used its surcharge fund for construction as shown below:

Fiscal year 1971:

18 major projects----------------------------------------- $3, 905, 000

Minor improvements__________-----------------_ 373, 000

Total -------------------------------------------------- 4,278,000

10 major projects------------------------------------------2, 577, 000

Minor improvements -----------------------------------------170, 000

Total --------------------------------------------------- 2,747,000

Fiscal year 1973 (9 months) :

7 major projects-------------------------------------------____________ , 519,000

Minor improvements- - - - - --____________________________ 179, 000

Total __ --------------------------------------------------- 1,698,000

Unlike the Army and Air Force, the Navy and Marine Corps include the sur-

charge in the shelf price of the commissary merchandise. The Navy surcharge

ranges from 3 to 5 percent of costs with the exact amount of the surcharge being

determined at the local level. One percent of sales is transferred to the surcharge

reserve fund controlled by headquarters and the remainder continues under

local control to pay day-to-day expenses. The headquarters reserve fund is used

for large nonrecurring expenditures.

Navy officials claim that surcharges are adjusted at the local level so that these

moneys match day-to-day expenses as nearly as practicable. Therefore, they say,

large amounts do not accumulate at the local level.

The Navy headquarters surcharge reserve fund balance is fully committed

except for the $200,000 minimum reserve which is required at all times. Large

commitments which will be paid from the reserve fund are anticipated in the

near future for:

Expansion of the sales area at the New Orleans commissary ($300,000 to

$500,000) ;

105

Construction of a dehumidified storage warehouse at Roosevelt Roads, Puerto

Rico ($250,000 to $300,000), and

Construction of a central meat cutting plant at Norfolk ($500,000).

Navy officials advised the investigative staff that they believe they are adhering

strictly to DOD's policy and interpretation of the annual appropriation acts

which prohibit increases in surcharges for the purpose of paying for new com-

missaries by preventing local complexes from accumulating excess surcharge

funds. It is obvious from the above that the 1 percent surcharge required to be

transferred to the headquarters surcharge fund is accumulated, at least in part,

for the purpose of funding commissary construction.

E. MARINE CORPS

The Marine Corps has used its surcharge funds extensively for the construction

and renovation of commissaries, as shown below :

Cost

Fiscal year Activity Type (thousands)

1968.............-----------............ ---------Camp Pendleton.....-----------.......... Warehouse renovation ......... $734

1969...---------------------.......................... New River.................... ------------Storage building---------------............... 140

1970-------------........----..........-----....--... Twentynine Palms------..........--- New sales store............... 504

1971............................. Cherry Point..........------------..... Renovation/addition........... 185

1972-------------........................... Albany---------......-----................ Addition.....-----------..........------....... 192

1972.....-------------------........................ Iwakuni.............--------------------do----------------------....................... 81

1973------------..................--------........ Camp Lejeune............-----------... Renovation/addition............ 194

1973............................. Barstow...................... Addition...................... 48

1973.............................------------------ Quantico..................... --------------New facility.. ------------------- 1,497

Total........-------------------.............................-----------------------------------------------....... 3,575

During fiscal years 1974 and 1975, the Marine Corps plans to spend an addi-

tional $1.8 million in surcharge funds for a new commissary at El Toro, Calif.

The Marine Corps also permits individual activities to retain control of most

of the surcharge money they collect. The total surcharge ranges from 3 to 5

percent of the cost of the merchandise and 1 percent is transferred to the head-

quarters surcharge account. Each activity establishes its surcharge rate within

the 3 to 5 percent range established by headquarters. As of February 28, 1973,

the headquarters surcharge account had an uncommitted balance of about

$260,000, but a headquarters official advised the investigative staff that this sum

and more--a total of about $1.2 million-would be required from the headquar-

ters account to pay for the new El Toro commissary. Unlike the Navy, however,

the Marine Corps allows the activities to accumulate unused surcharge money

for nonrecurring large expenditures. The surcharge funds held by individual

Marine Corps activities totaled about $912,000 as of February 28, 1973. About

$878,000 of this is controlled by three activities which are accumulating surcharge

funds for planned large expenditures as follows :

Quantico--new equipment for new commissary under construction ($159,000).

El Toro-new commissary to be built ($590,000).

Pendleton-new annex to be built ($129,000).

III. AIR FORCE

A. DETERMINATION OF REQUIREMENTS AND PRIORITIES

An Air Force official stated that the Air Force considers commissary resale

stores as one of the most important fringe benefits accorded to the military man.

Average savings in buying at the commissary were estimated to be 30 percent.

It was claimed that these savings are considered in the determination of military

pay rates.

Air Force food sales during fiscal year 1972 totaled almost $1 billion and sales

over that amount are forecast for fiscal year 1973. About 93 percent of this total

is for sales in commissaries and 7 percent for troop issue or sales to nonappro-

priated fund activities. Currently the Air Force has 185 commissaries.

The Chief of the Military Construction branch, Directorate of Civil Engineer-

ing, advised that early in each calendar year the Director of Civil Engineering

issues guidance to the Air Force major commands concerning the commands'

submittal of proposed facilities for inclusion in the Air Force military construc-

106

tion program for the second following fiscal year; that is, guidance issued in

January 1973, would be for the fiscal year 1975 military construction program.

Presumably the basis for a command's submission would be what new facilities

are most needed to correct existing deficiencies. Each command is not given an

absolute dollar limitation, but is aware of authorizations for prior years and

"gets the message."

The various commands submit projects with backup data to the Director of

Civil Engineering for inclusion in the Air Force military construction program.

The projects are then referred to interested Air Force agencies. Commissary

requirements are based on need determined by space occupied, condition, current

sales, and projected sales. Commissary items are referred to the logistics facilities

program branch, systems and logistics, which has responsibility for commissaries.

Submissions are compared with a previously established priority list for re-

placement of commissaries. At present 36 commissary replacements are listed,

but this does not include three commissary replacements which are in the fiscal

year 1974 military construction program. Cost for these 36 replacements is esti-

mated to be $68 million. This list provides a means for the logistics facilities pro-

gram branch to evaluate command requests.

After the various projects are reviewed by the interested staff agencies, the

entire military construction program is transmitted to the facilities require-

ment committee, which is chaired by a representative from the Directorate of

Civil Engineering and whose membership consists of representatives from nine

other staff elements. This committee considers the military construction pro-

gram as a whole. The various projects are weighed against one another and

considered in the light of the Air Force total requirement; that is, requests for

commissary projects must compete with all other proposed projects. Following

its review the committee validates the military construction program and, in

conjunction with the Director of Civil Engineering, develops data to support the

facility requirement during review by higher authority.

Air Force operating instructions provide that the chairman of the facilities

requirement committee presents the annual military construction program to

the program review committee and to the air staff board.

After air staff review the military construction program is sent to the Secre-

tary of the Air Force for approval, after which, the program is transmitted about

October 1, to the Office of the Secretary of Defense for review.

B. FISCAL YEAR 1974 COMMISSARY CONSTRUCTION PROGRAM

The investigative staff was advised that prior to fiscal year 1971 commissary

construction through the Air Force military construction program was negligi-

ble. From fiscal year 1966 through fiscal year 1970 no new commissaries were

authorized. In fiscal year 1971 four new commissaries totaling $5.1 million were

authorized; in fiscal year 1972 five new commissaries totaling $6 million were

authorized; and in fiscal year 1973 three new commissaries totaling $8.1 million

were authorized. In its fiscal year 1974 military construction program the Air

Force has requested funding for three new commissaries :

Scope Total cost

Installation (in square feet) (in thousands)

Hickam Air Force Base, Hawaii. _____.._._._...__... ..... ._ 73, 500 $2,963

Peterson Field, Colo __.______-------------------------73,500 2,270

Bergstrom Air Force Base, Tex. _.o..o_ _________ ___ . . . 81, 000 2,273

The Air Force has established priority for these projects in the order listed.

The Hickam Air Force Base (AFB) commissary project was included in the Air

Force military construction program for fiscal year 1973 but was deleted by the

Congress. The fiscal year 1973 request was also for a 73,500 square foot facility

and the estimated cost was $2.763 million as opposed to the fiscal year 1974 esti-

mated cost of $2.963 million.

The DOD construction criteria manual states that, in the construction of a

commissary store, the gross floor area will be based on the dollar volume of sales

that will be generated by the maximum number of authorized customers antici-

pated within the next 5 years. An official in OSD explained that at one time

criteria for size was based on troop strength but this proved unreliable, and that

107

the present criteria based on the monthly dollar sales and a projection from these

sales were jointly developed by OSD and the services. The DOD construction

manual provides for 23 sizes of commissaries varying from 4,000 square feet to

122,500 square feet based on monthly sales from $15,000 to $1,500,001 or over.

Any project over 122,500 square feet must be approved by OSD. The dollar sales

must be adjusted to the value of the food dollar as of July 1, 1970, as established

by the Bureau of Labor Statistics wholesale processed food index.

Equipment which is installed as an integral part of the building is financed

with appropriated funds; other equipment is financed with surcharge funds.

The Air Force has adopted definitive drawings for commissaries of four sizes:

30,500, 51,000, 88,500, and 122,500 square feet. These definitive drawings are also

used as guidance for designing commissary buildings of other size.

According to officials in the general support and services division, the Air Force

has not promulgated a formula for projection of commissary sales because of

variables. This projection has been left to the commands. An official in the supply

services branch furnished the following sales projections:

ESTIMATED SALES COMMISSARIES (ADJUSTED TO JULY 1, 1970, DOLLARS)

[in thousands of dollars)

Hickam AFB Peterson Field Bergstrom AFB

Fiscal year:

1973- -.... .......................... .. .......... 901 770 835

1974.... ... ....-- - . . . - - .. .. 946 816 877

1975........................ ....... . . ... .. ... . 993 857 921

1976-----------------------------......................... ... . -------------- 1,192 1,071 1,243

1977......... --------............. .. .. ...-- .. 1,251 1,125 1,305

1978...........-------------.... -----.... ---.....------- ------------ 1,314 1,181 1,370

The current project at Hickam AFB is for 73,500 square feet. An existing

cold storage warehouse of 10,700 square feet and an existing warehouse of

21,000 square feet will be retained; so with completion of the new commissary,

105,200 square feet will be for commissary use which is 96 percent of the 109,500

square feet authorized by DOD construction criteria.

The current project at Peterson Field is for 73,500 square feet or 76 percent

of the 96,000 square feet authorized by the DOD construction criteria.

The current project at Bergstrom AFB is 96,000 square feet, which along with

a 6,408 square foot warehouse, that will be retained for commissary use will

provide 79 percent of the space authorized by the DOD construction criteria.

The official who made the sales projections said they were based on about

a 5 percent per year increase in the volume of sales plus a 20 percent additional

increase upon completion of the proposed commissaries at Peterson Field and

Hickam AFB and a 30 percent increase upon completion of the commissary at

Bergstrom. Air Force experience has been that sales increase from 30 to almost

50 percent with the completion of a new commissary.

New commissaries for these three Air Force installations were considered

for the fiscal year 1973 military construction program. As mentioned previously,

the Hickam AFB project was deleted from the fiscal year 1973 program by the

Congress; the Peterson Field project was deleted by OSD; and the Bergstrom

project was deleted by Air Force Headquarters. Proposed commissaries at

Hickam AFB and Peterson Field were not increased in size for the fiscal year

1974 program but there was an increase at Bergstrom.

An Air Force Headquarters official said that, although sales projections

might justify a larger facility, instructions were issued that the Peterson Field

commissary was not to exceed 73,500 square feet for the fiscal year 1974 pro-

gram because of a new Army commissary being built at nearby Fort Carson.

He said the size of the Hickam AFB commissary cannot be increased because

of siting. An Air Force official pointed out that in the fiscal year 1973 military

construction program, the Congress approved about $8 million for new Air

Force commissaries, so for fiscal year 1974 the Air Force is asking for commis-

sary projects totaling $7.4 million. This official claimed it was better to have

three badly needed commissaries built for present needs rather than only two

for projected needs.

108

PROPOSED NEW COMMISSARY FOR PETERSON FIELD, COLO.

As set out heretofore, the Air Force, in fiscal year 1974, is requesting $2.27

million for the construction of a 73,500 square foot commissary at Peterson

Field which is 6 miles east of Colorado Springs, Colo. Air Force officials state that

this facility is required in conjunction with the move of Air Defense Command

Headquarters and base support functions from Ent AFB, Colorado Springs to

Peterson Field.

At present the Peterson Field/Ent AFB complex is operating two commis-

saries: A main commissary at Ent AFB, and an annex at Petersen Field.

The Ent AFB sales store of 17,688 square feet is located in three different

buildings which have been joined. Because the elevations of the buildings are

different, customers must use ramps when going from one store to another.

The cold storage space of 2,150 square feet is also located in one of these build-

ings. Warehouse space of 7,700 square feet is provided in two other buildings

near the three-building sales store.

All the buildings are of semi-permanent structure. Parking is provided about

11/2 blocks distant and is used by the base as a whole. Officials advised that park-

ing is inadequate and that on many occasions commissary patrons must park off

base on the streets of Colorado Springs. The investigative staff was advised that

the present facility contains only 43 percent of authorized space. Upon completion

of the proposed commissary, one of the buildings with 2,000 square feet used for

the sales store will be retained for other base use; one warehouse of 4,500

square feet will be preserved for future use; and the remainder of the buildings

will be turned over to the General .Services Administration for disposal.

The Peterson Field sales store contains 1,820 square feet. Warehouse space of

4,308 square feet is located in the same building, and an additional 11,076 square

feet of warehouse space is located in two additional buildings. All buildings are

of semi-permanent construction. Parking spaces are provided adjacent to the

sales store. Upon completion of the proposed commissary all Peterson Field com-

missary buildings will revert to the base for other uses.

The commissary is staffed by civilian employees and a total of 131 employees

are authorized. Because of the hiring freeze the commissary is, at present, short

16 employees; however, this deficiency is offset by the use of 13 military person-

nel which Ent AFB officials claim are being used on a temporary basis. The cur-

rent payroll for the 115 civilian employees is about $1.3 million annually.

Air Force officials advised that the primary reasons for the construction of a

new commissary at Peterson Field are: One, the need to vacate Ent AFB due to

the expiration of the lease on the land; and, two, the inadequacy of the present

commissary at Ent AFB and the annex at Peterson Field. For years the Air

Force has been phasing out old facilities at Ent AFB and moving functions into

new facilities at Peterson Field. This is a two-phase move and phase one-the

north side of the base-is scheduled to be completed with approval of those proj-

ects in the fiscal year 1974 program. Although the present commissary is not lo-

cated on the north part of the base, the commissary parking is. From fiscal year

1964 through fiscal year 1973, $31.8 million was appropriated for construction of

new facilities at Peterson Field. Upon completion of the move from the north

side, buildings valued at $6 million will be turned over to the General Services

Administration for disposal.

DOD Directive 1330.17 dated October 29, 1971, provides that a commissary must

be located on a hard surface road which is open year round. Travel time to the

commissary by private conveyance under normal traffic conditions should not

exceed 10 minutes, and by commercial vehicles should not exceed 15 minutes. The

intervals between scheduled commercial vehicles should not exceed 30 minutes.

An Air Force official pointed out that two other commissaries are located in the

area, one at Fort Carson, 21 miles from Peterson Field and another at the Air

Force Academy 26 miles distant. An Air Force official stated that the Air Force

Academy, Fort Carson, and Peterson Field each have facilities to serve their

own assigned personnel. The Air Force Academy has an adequate commissary

with average monthly sales over $500,000, and Fort Carson has an adequate com-

missary with average monthly sales exceeding $1 million. It was claimed that the

new Fort Carson commissary. which is under construction, will be adequate to

serve only Fort Carson residents and those eligible persons living nearby.

The aforementioned DOD directive provides that merchandise should be sold

in the commissaries at the lowest practicable price, except those commissaries of

the Army and Air Force which are required by statute to sell at cost. Criteria for

the establishment and continuance of a commissary provide that if the average

109

prices listed in two nearby competing commercial stores exceed by 20 percent

prices of the commissary, the prices of the commercial establishments will be

considered to be unreasonable. The commissary officer at Ent AFB advised that

the last price survey made in December 1972 showed the commissary foods to be

35.68 percent cheaper. He thought this differential could be increased, pointing

out that because of inadequate warehouse space commissary deliveries must be

made weekly which increased costs in additional accounting, labor in the ware-

house, and a higher price for the article. Also, because of the lack of cold storage

space, frozen food must be ordered through a broker in small lots which increases

costs rather than direct from the producer.

The investigative staff was advised by the Ent AFB commissary officer that in

the past 10 years the population of the city of Colorado Springs has doubled in

size, a high percentage of whom are military retirees entitled to use the com-

missary.

The proposed commissary to be constructed at Peterson Field, Colo., is to be

sited, according to the base master plan, adjacent to a newly constructed base

exchange and in the community center area. The site previously housed the base

motor pool, Funding for construction of new motor pool facilities at another site

was approved in the fiscal year 1973 military construction program. Seven build-

ings of semipermanent construction totaling 28,408 square feet and two buildings

of temporary construction totaling 3,786 square feet must be demolished to make

way for the new commissary.

The proposed commissary will be built in accordance with Air Force definitive

drawings and will be a single-story masonry building with a partial basement.

Of the 73,500 square feet of space, 23,100 feet will be devoted to the sales area

and the remaining area will be for storage (both dry and cold), food prepara-

tion, and other support areas such as offices and restrooms. The overall dimen-

sions are to be 245 by 300 feet. Two hundred and fifty parking spaces are to be

provided in a 478-space parking lot; the remainder of the parking spaces being

for use of a nearby administration building.

The commissary as well as many of the other facilities at Peterson Field are

to be constructed on land leased for 99 years. This lease is now in its fifth year.

Air Force officials in both regional and base civil engineering offices advised

that they did not contact Army officials concerning the costs of construction of a

commissary at Fort Carson, just south of Colorado Springs, for which funds were

appropriated in the fiscal year 1972 military construction program. They com-

mented that very little "cross-pollination" exists between the Air Force civil

engineers and the Corps of Engineers. However, the firm which was awarded

the architect/engineer contract for the Peterson Field ('ommissary did the site

engineering on the Fort ('arson Commissary and assembled the same team

through subcontract that did the complete architect/engineer work at Fort

Carson. An official of the firm said that the buildings are about the same size and

that the design is similar except that at Fort Carson the storage area is on both

sides of the sales area, whereas at Peterson the storage will be only on one side.

He advised that he has seen no "frills" or unnecessary items in the plans and

feels that, since the Fort Carson bid was under the estimate. that the Peterson

Field bid would hie about the same per square foot plus intervening inflation.

On April 19, 1973, the architect/engineer contractor estimated design to Ie 25-

percent complete and thought the cost estimate vwas "in the ball park."

Air Force officials advised that increases in costs due to escalation are applied

by the Air Force Directorate of Civil Engineering. Washington. I).C. )fficials

of this directorate advised the investigative staff that projects included in the

fiscal year 1974 military construction program are projected to April 1, 1974,

and an inflation factor of 61/ percent was applied for 1973 and 6 percent per

year thereafter. Base officials on June 15. 1972. estimated costs to be $25.75 per

square foot, and the submittal to Congress showed estimated costs to be $27.30

per square foot.

IV. ARMY

A. DETERMINATION OF REQUIREMENTS AND PRIORITIES

The initial action that will ultimately result in a commissary project being

included in the military construction program is the identification of a particular

need by the various base commanders. The base commanders develop programs

for their respective installations which include all projects determined to be neces-

sary for the base. These projects are ranked in order of importance by the bIase

commander, and submitted to the appropriate major command.

110

The major command receives submissions from all installations under its au-

thority. The relative merits of the individual projects are considered, and the

data provided by the bases in support of the projects is validated. The command

will rank all projects in order of priority before submitting the command pro-

gram to the Department of the Army, Headquarters.

The investigative staff was informed that Army Headquarters usually retains

the command priorities unless factors such as troop strength changes affect the

priorities. Such data may not have been available tot he commands in establish-

ing their priorities.

Headquarters merges all command submissions into a consolidated Army pro-

gram at which time all projects compete with each other for inclusion in the

final program. Factors considered in the development of this overall program

include the following:

(1) Need for the new facility based on the condition of the present facility,

(2) Availability of suitable alternatives to the project (in the case of commis-

saries, this would include the existence of commercial facilities in the immediate

area),

(3) The number of personnel expected to derive benefit from the project, and

(4) Any plans that are being considered for future troop increases or de-

creases at a particular base.

Upon completion of the relative ranking of all projects, the Department of the

Army submits its recommended program to OSD.

B. FISCAL YEAR 1974 COMMISSARY CONSTRUCTION PROGRAM

The Army has three commissary projects in the fiscal year 1974 military con-

struction program :

(1) A 98,190-square-foot facility at Fort Gordon, Ga., estimated to cost $2.924

million. This facility will replace the present sales store which is housed in a

converted warehouse constructed in 1941.

(2) A 51,000-square-foot replacement for the commissary at Fort Polk, La., at

an estimated cost of $1.977 million. The present commissary was constructed in

1941 and will revert to warehouse use upon completion of the new building.

(3) A 109,500-square-foot facility at Fort Campbell, Ky., estimated to cost

$3.388 million. The commissary is presently in converted warehouses constructed

in 1942.

The 3 projects in the fiscal year 1974 program were among 40 commissaries that

the Army has identified as needing replacement, expansion, or modification. How-

ever, the investigative staff was informed that there may be more than 40 such

facilities, and others may be included as more information is made available to

the Department of the Army by the individual commands.

The investigative staff noted that the recently announced closings and realine-

ment of military installations would have no significant effect on the commissary

facility needs projected by the Army in its fiscal year 1974 military construction

program. Pertinent details appear later in this report.

Of the three proposed commissaries in the program, Fort Campbell, Ky., is

the highest priority because, according to Army officials, it was in the fiscal year

1973 program and the need continues to be urgent. Brief summary data on the

Fort Polk, La., and Fort Gordon, Ga., commissaries, and detailed data on the

Fort Campbell project follow.

1. FORT GORDON, GA.

The present commissary at Fort Gordon is located in a converted warehouse

and has a limited sales area which results in congestion during peak periods. Some

warehousing support for the sales store is in remote locations on the installation.

Sanitary standards are difficult to maintain because of the condition of the

structure. Thus, not only is service less efficient than desired, some potential

patrons do not make use of the facility because the service is not attractive. There

are no existing facilities on the base which can be satisfactorily converted to

commissary use.

Sales increased from $372,000 monthly in fiscal year 1965 to $891,000 monthly in

fiscal year 1972. Average monthly sales for the first quarter of fiscal year 1973

were $946.000. On the basis of past experience for all commissaries, the Army

Food Service projected an S.8-percent annual increase in sales, and adjusting for

the change in the Bureau of Labor Statistics wholesale processed food index,

projected sales of $1.212 million monthly by fiscal year 1978. While the applicable

111

DOD criteria permit a maximum of 103,000 square feet, the proposed facility

requirement is estimated at 98,190 square feet.

The recently announced closings and realinement of military bases should not

significantly affect the potential sales at Fort Gordon.

2. FORT POLK, LA.

Fort Polk's commissary is now located in temporary buildings constructed in

1941, and according to Army officials, does not meet the needs of the base. Ware-

housing is located away from the sales area, which results in an inefficient

operation. Additional family quarters under construction on the base will in-

crease the potential customers of the store which cannot now adequately meet

the needs of its customers. Fort Polk is in an isolated area, and the available

commercial facilities are limited.

Monthly sales have increased from $215,000 in fiscal year to $440,000 during the

first quarter of fiscal year 1973. Based on the Army Food Service projected in-

crease of 8.8 percent annually, and the offset for the increase in the Bureau of

Labor Statistics Wholesale Processed Food Index, monthly sales for fiscal year

1978 are estimated at $577,000. The space requirement is stated at 51,000 square

feet, which is in accordance' with applicable DOD criteria.

The recently announced military base closings and realinements did not affect

Fort Polk.

3. FORT CAMPBELL, KY.

Of the three proposed Army commissaries in the fiscal year 1974 program, the

one for Fort Campbell is of the highest priority. The Fort Campbell commis-

sary project was in the fiscal year 1973 program, and the Army belives it to be

greatly needed to replace the substandard facility, as well as to meet the demands

of an increased customer load as all elements of the 101st Airborne (Airmobile)

Division return to Fort Campbell. The Division is presently building up to full

strength.

PRESENT FACILITY

The present commissary at Fort Campbell is located in three warehouses which

are connected by covered corridors. These buildings were constructed in 1942

with an expected life of 10 years. Storage is located mainly in other warehousing

located away from the sales store. Only meat preparation facilities, produce and

a portion of backup storage are located in the three connected buildings. The

condition of the existing buildings is such that normal warehousing machines

such as forklifts cannot be used because the wooden floors cannot support such

machinery. Stock must be hand loaded on carts, and then restacked by hand

in the warehouse.

The investigative staff observed the condition of these facilities and noted

that both the sales area and warehouses appeared to be in need of repair. Exterior

walls on some of the remote warehouses showed damage, and many inside walls

needed repair. Floors had been repaired in both the sales and warehousing areas.

The cost of repairs and modifications to commissary buildings have amounted

to over $200,000 since fiscal year 1967. Some of the remote warehouses were un-

heated and therfore suitable only for certain types of storage.

As part of this project, 16 temporary buildings totaling 77,170 square feet will be

demolished. Other buildings will revert to general warehouse use.

The investigative staff was informed by commissary personnel at Fort Campbell

that the commissary was not able to accommodate all customers during peak pe-

riods such as paydays. Part of the load is taken off the main store by the opera-

tion of two annexes. The investigatve staff noted that the operation of both

annexes was less than efficient because there was no room for backup storage

at these facilities making it necessary to bring supplies in frequently. In addition,

there was no refrigerated truck available to carry fresh meat from the preparation

area at the main store to the annex located away from the main store. A com-

missary official claimed that in the summer, meat literally decayed on the way

to the annex.

Based on its observations at Fort Campbell, the investigative staff concluded

that the present commissary is not efficient because it is spread over eight build-

ings. Because of the poor physical condition of the buildings, they are difficult to

maintain in a sanitary condition, and there is no fire sprinkler system.

20-192 (Pt. 1) 0 - 73 -- 8

112

PROPOSED FACILITY

As previously noted, a new 88,500 square foot commissary at Fort Campbell was

first proposed in the fiscal year 1973 military construction program; however, it

was deleted by the conference committee in about October 1972. It was the desire

of the Army to reinstate most of the projects deleted from the fiscal year 1973

program in the fiscal year 1974 program and, of these, this commissary was No. 1

in priority. At this point in time, the fiscal year 1974 program was nearly finalized,

and in order for the Fort Campbell project to be put in the fiscal year 1974 pro-

gram without delay, it was necessary to use the available data calling for 88,500

square feet.

During the same period of time, officials at Fort Campbell had developed

new documentation supporting 109,500 square feet and asked that the scope of

the project be increased. Because the budget was so far along, and Army Head-

quarters was firm on the dollar amounts, another project would have had to

be deleted in order to increase the Fort Campbell project. Thus, even though

the 109,500 square foot need was recognized as valid, it was planned to build

an 88,500 square foot facility and retain the annexes and some of the remote

warehouse space presently in use.

Later, realinement of projects within the Army construction budget made

additional funds available for the Fort Campbell project as some projects or

line items that had appeared necessary were no longer necessary.

The Investigative Staff was informed that portions of the completed 88,500

square foot design, which cost $98,500 to develop, could be adapted for the

new scope, and that about $70,000 would be required to accomplish the redesign.

The need for the 109,500 square foot facility is supported by the following

sales and personnel forecasts provided by Army officials:

Sales.-From average monthly sales of $520,000 in fiscal year 1968, monthly

sales increased to $1,039,000 for the first 3 quarters of fiscal year 1973. Based

on an 8.8 percent projected annual increase (which was developed by the

Army Food Service on the experience of all commissaries), and reduced by the

increase in the Bureau of Labor Statistics Wholesale Processed Food Index as

required by applicable DOD criteria, the projected monthly sales for fiscal year

1978 are estimated at $1,354,000. This sales level meets DOD criteria for a

109,000 square foot facility.

Personnel.-The average monthly number of personnel using the commissary

increased by about 10 percent in the period between fiscal years 1970 and

1972, to a total of 56,962 per month. There will be an additional increase when

all elements of the 101st Airborne (Airmobile) Division are located at Fort

Campbell and filled to authorized manning. Recently announced base closings

and realinements indicate that about 200 military positions will be transferred

to Fort Campbell. According to officials at Fort Campbell, the present facility

is not adequate to meet the needs of the present personnel, some of whom

must sacrifice the cost savings of the commissary when they shop for groceries

in the community.

The closest commissary to Fort Campbell is located 190 miles away at Fort

Knox, Ky., which is not convenient to the personnel at Fort Campbell. Com*

mercial facilities in the area were considered by the Army to be neither con-

venient, adequate nor reasonable in price. Moreover, a cost comparison survey

conducted in August 1972 disclosed a 32.6 percent price differential between the

commit ary and nearby commercial facilities.

V. NAVY

A. DETERMINATION OF REQUIREMENTS AND PRIORITIES

The first step in establishing priorities for building commissaries as military

construction in the Navy is the completion of a basic facilities requirements

list (BFRL) which is a listing of needs arranged by type of activity or facility.

Thereafter, a development of assets listing, based on engineering studies, is

prepared wihch identifies that portion of assets considered to be substandard.

The result of the asset determination is added to the BFRL to arrive at a

deficiency/excess listing. An attempt is made to convert excesses to correct

deficiencies. If the cost to remove a deficiency is $50,000 or more, it, for all

intents and purposes, becomes a military construction project. If the cost to

remove a deficiency is less than $50,000, it can be taken care of with other

appropriated funds.

113

The fifth year from the current year (1978 for projects submitted with the

fiscal year 1974 budget request) is used for commissary planning. Sales pro-

jections are used to determine gross floor area required.

The Navy attempts to provide continuity in planning through the use of a

military construction multiyear planning program. The goal of this concept

is a balanced rate of correction of investment category deficiencies within an

established timeframe as permitted by budget constraints. Investment cate-

gories are divisions of like facilities. Available funds are allocated on the

basis of the percentage of deficiencies per category and the age of existing

facilities.

Once the investment categories have been budgeted, a priority listing is

established. For this the item rating value (IRV) is used. The following factors

are considered in the IRV system:

(1) Mission.

(2) Degree of deficiency.

(3) Type of facility.

(4) Economic value.

(5) Major claimant (command) priority.

The priority placed on an item by the major claimant is the primary factor in

rating the item.

The Navy has compiled a list of proposed military construction commissary

store projects for fiscal year 1975 and beyond. There are 55 locations on this list

with a total estimated cost for construction of $87,738,000.

B. NAVAL STATION, ADAK, ALASKA

The Navy has requested funding for one commissary in the fiscal year 1974

military construction program for the naval station located at Adak, Alaska. The

amount requested for the project is $1.92 million.

The mission of the Naval Station, Adak, Alaska, is to provide services and

material to support operations of aviation activities and units of the operating

forces of the Navy and to provide fleet broadcasts, tactical ship-to-shore and

point-to-point communications in support of the defense communication system

for surface ships and submarines operating in the Alaskan area. As of Decem-

ber 31, 1972, there were a total of 2,756 permanent and supported personnel at

the naval station and it is planned that there will be a total of 2,790 personnel

at the end of fiscal year 1977. The realinement of defense installations announced

April 17, 1973, will not significantly affect the number of personnel assigned to

Adak.

The existing commissary is operating out of a two-story wood frame building

originally constructed in 1944 as a small warehouse. It has a total gross area of

12,165 square feet. According to information furnished by Navy officials, the ex-

isting building has major structural deterioration with severe checking in all

beams and columns, rotting flooring and roofing, and severely damaged siding.

The building roof leaks badly and is a serious handicap because there is rainfall

on an average of 261 days per year on Adak Island. The investigative staff

viewed photographic slides of the present facility and it appeared that the build-

ing is about to collapse.

The existing commissary was said by a high-ranking Navy officer to be 60

percent of the required size. The existing meat preparation area is 2 miles from

the commissary. Navy officials estimate that annual savings of $19,800 would

accrue due to reduced maintenance cost of a new facility and by locating a new

butcher shop within the facility.

The nearest off-shore community capable of providing food sales services is

Anchorage, Alaska, which is 1,150 miles from Adak. The commissary is the only

retail food outlet on Adak Island.

PROPOSED FACILITY

The site selected for the proposed commissary is in accordance with the sta-

tion master plan and will be located adjacent to one of the three housing areas

on the base. If approved, it will be built on engineered fill on what was originally

a lagoon bottom. Soil conditions eliminated other potential sites for community

support development.

There was a proposal first submitted with the budget for fiscal year 1970

calling for the erection of a single building having a post exchange, commissary,

b0st office and several other community support facilities. This project was

114

finally approved, minus the commissary, in the fiscal year 1972 budget and is

now under construction. The commissary now proposed will be an addition to

the community support building under construction. The proposed commissary

will share a covered mezzanine with the other building and will place all com-

munity development facilities under one roof. The structure will consist of a

single story except for the mezzanine.

The projected size of the new commissary of 20,585 square feet is based on the

long range sales forecast of $170,000 per month in 1978 which, after elimination

of the surcharge and a reduction in projected sales by the percent of increase in

the Bureau of Labor Statistics Wholesale Processed Food Index subsequent to

July 1, 1970, is adjusted to $101,315 per month. The proposed square footage is

in conformance with the Department of Defense Construction Criteria Manual

as is the method of adjusting the long range sales forecast.

The proposed commissary is to be built with precast concrete panels which

will be fabricated in Seattle, Wash., and shipped to Adak at a far lower labor

cost than can be obtained at the job site, according to Navy officials. The roof on

the proposed commissary will be built with neoprene because regular asphalt

roofing is difficult both to install and repair due to the temperature and moisture

conditions on Adak Island.

The preliminary cost estimate (PCE) prepared by the architectural and engi-

neering contractor and approved by the Western Division of Naval Facilities

Engineering Command (NAVFAC), San Bruno, Calif., estimated a total project

cost of $2,116,000. According to information set forth on the PCE, the cost of

$91.27 per square foot is in agreement (within 8 percent) with the average cost

of $84.44 per square foot as determined from the Military Construction Cost

Review Guide for fiscal year 1974. The basic average cost per square foot for a

commissary is $23.91, which is then adjusted for several factors, such as the

high cost of labor on Adak Island, lost salary due to weather conditions, and

special considerations necessary for the seismic features at Adak. The request

in the fiscal year 1974 military construction program for the Adak commissary is

$1.92 million or $196,000 less than the estimated cost in the PCE. This reduction

in cost was accomplished by a decrease in military construction equipment costs

from $239,000 to $43,000.

The current status of the design of the proposed commissary at Adak is that

the PCE has been prepared by the engineering and architectural contractor and

approved by NAVFAC. The 30 percent complete design is due to be submitted

by the architectural and engineering contractor by April 30, 1973.

VI. MARINE CORPS

A. DETERMINATION OF REQUIREMENTS AND PRIORITIES

The process for establishing priorities for military construction by the Marine

Corps is as follows:

There are 23 commands in the Marine Corps which submit their own construc-

tion programs for each budget year to Headquarters Marine Corps (HQMC).

The programs are screened or validated at HQMC based on each command's

mission. The projects are then arranged by sponsor, a sponsor being a partic-

ular person or persons at HQMC whose field of interest is a particular type

of facility such as commissaries. The sponsors then prepare comments on the

projects within their listings and submit these to the Military Construction

Review Board.

The Military Construction Review Board is subordinate to the Military Con-

struction Steering Committee and is composed of military specialists in various

fields who are interested in military construction. The Military Construction

Review Board communicates extensively with the sponsors and evaluates the

proposals and comments submitted by the sponsors. The Board then recom-

mends a program to the Military Construction Steering Committee composed

of high-ranking military officers and civilian employees.

After review, the Military Construction Steering Committee recommends a

construction program to the Chief of Staff, who, if he approves the program,

sends it to the Naval Facilities Engineering Command (NAVFAC) for cost

estimates. HQMC may or may not make changes in individual proposals after

the estimates are complete. However, upon completion of all reviews and any

necessary adjustments, the program is sent to the Navy Comptroller who includes

the Marine Corp construction program with the Department of Navy military

construction program for submittal to OSD.

115

In addition to the Marine Corps Air Station, Yuma, the only new commissary

which the Marine Corps plans to build with military construction funds is at the

Marine Corps Recruit Depot, Parris Island, S.C. The projected cost of this facility

is $1.4 million and is currently scheduled to be requested in fiscal year 1976.

B. FISCAL YEAR 1974 COMMISSARY CONSTRUCTION PROGRAM

The Marine Corps has requested funding for one commissary in the fiscal

year 1974 military construction program at the Marine Corps Air Station

(MCAS) at Yuma, Ariz. The budget request for the project is $99,000.

The mission of MCAS, Yuma, Ariz., is to serve as the primary aerial weapons

training base for West Coast Navy and Marine Corps fighter/attack squadrons.

As of December 31, 1972, there were a total of 3,421 permanent, supported and

student personnel at the Air Station; it is planned that there will be a total

of 4,878 personnel at the end of fiscal year 1975.

The existing commissary is operating out of a temporary wood frame building

constructed in 1943 as a mess hall. The expected life of the building when

erected was 10 years. It is located in the middle of a barracks area of the base.

There are 6,000 square feet of sales area and five checkout counters. There

is no sprinkler system which, coupled with the age of the building and dryness

of the wood, would appear to constitute a serious fire hazard.

The investigative staff toured this facility and noted some structural deteriora-

tion in the building itself as well as severe space limitations which substantially

restrict the operation of the commissary. There is no central heating; heat is

provided through gas-operated space heaters hanging from the ceilings. Lighting

consists of industrial overhead fixtures and appeared to the investigative staff

to be grossly inadequate. There was some visible deterioration and water damage

in the wood, especially in the ceiling, evidently caused by leaks in the roof. The

investigative staff was informed that the roof is patched periodically but new

leaks continue to develop. The beams, which are exposed, are bolted together

and some have visible cracks.

Some refrigeration and refrigerated display cases are up to 30 years old.

Repair and maintenance are a problem complicated by the difficulty in obtaining

spare parts for such old equipment. The refrigerated meat cooler and meatcutting

room structure is deteriorated. The meat cooler leaks and the walls are buckling,

thus creating a sanitation problem. There is no steam cleaning facility in the

meat preparation area nor is there any drainage and sawdust must be spread

on the floor to absorb moisture.

On the exterior of the building, paint was peeling badly from the wooden

portion of the structure. An engineer at the base advised the building was painted

2 years ago but the wood is so old and dried out it will no longer hold paint.

Sheet metal flashing on the roof was badly deteriorated and would not hold to

the roof in some places.

An official at the commissary advised that inadequate space not only in the

sales and storage areas, but also in the office area of the commissary is detri-

mental to efficient operations and most inconvenient to commissary customers.

The warehouse aisles are too narrow to accommodate anything but handcarts.

Forklifts cannot be used which necessitates manual handling of all cartons. The

receiving section can accommodate only one truck at a time, which causes other

trucks and deliveries to be delayed. In the meat receiving area, the overhead

rail does not extend out far enough and is not high enough to reach the delivery

trucks, which necessitates manual handling of all meat delivered on meat hooks.

A new barracks was constructed on what was the commissary parking area.

The little parking space which is left is shared with a mess hall, public works

office and transportation office.

The existing commissary has a total gross area of 19,538 square feet; how-

ever, because of the poor configuration of the building, only 17,538 square feet

are usable.

As a result of a study performed 4 years ago, it was determined that the com-

missary could be renovated at an estimated cost of $250,000. A decision was made

not to perform the renovation because of the age of the building.

The site selected for the proposed commissary is in conformance with the

MOAS master plan which calls for the centralization of all community support

facilities in an area near the main gate, away from the barracks area. There

are no definitive design drawings for this type of commissary sales store; how-

ever, according to the PCE submitted by NAVFAC, the design layout incorporates

116

the better design features of both military commissary and civilian marketing

facilities.

The Yuma area is located approximately 180 miles from the closest metro-

politan area of any considerable size. The remoteness of this area necessitates

the use of construction materials locally available, and locally fabricated, or

materials which can be easily transported. Therefore, construction materials

will consist of load-bearing concrete masonry unit walls, with a steel-framed

roof system. Concrete masonry walls were selected because of (1) a good "H"

factor thus reducing the air-conditioning demand; (2) lower maintenance

requirements, and (3) they are esthetically pleasing.

The original design, as developed in an architectural and engineering study

by an independent contractor and NAVFAC called for a structure of 32,234

square feet at an estimated cost of $1.543 million. The Commandant of the

Marine Corps, in order to reduce the cost of the project, directed that the fol-

lowing modifications of design be made:

(1) Reduction of the building scope to approximately 26,200 square feet.

(2) Deletion of 4,980 square feet of covered walks.

(3) Relocation of walk-in refrigerated coolers and freezer storage from

internal building spaces to the exterior of the building, under awnings.

(4) Reductions of site improvements from approximately 6 acres to include only

the immediately adjacent area.

The requested design modifications were made which resulted in a new esti-

mated cost of $999,000. The date of the engineering cost estimate was August 10,

1972. This estimate was based on a projected bid date of August 10, 1974, and

includes a cost escalation factor of 10 percent per annum. Navy engineers in-

formed the investigative staff that they expect the cost of the project to be

wihin the estimate.

Should a new commissary be authorized for Yuma in the fiscal year 1974

budget, a monthly sales of $253,000 is projected by 1977. This projection is based

largely upon the experience at the Marine Corps Base at Twenty-nine Palms,

Calif., following the opening of a new commissary at that location.

The projected size of the new commissary, 26,200 square feet, is based on the

long-range sales forecast and falls within the criteria set forth in the Department

of Defense Construction Criteria Manual. The method of calculating the sales

projection-elimination of the markup (surcharge) and a reduction in projected

sales by the percent of increase in the Bureau of Labor Statistics Wholesale

Processed Food Index subsequent to July 1, 1970--is also in conformance with

the Department of Defense Construction Criteria Manual. However, as noted

previously, the total number of military personnel assigned to the air station

as of December 31, 1972, was 3,421 whereas the number of personnel expected

to be assigned at the end of fiscal year 1975 is 4,878, an increase of 43 percent.

The projected 1977 monthly sales of $253,000 per month was based on current

population with no provision for the expected increase in personnel. No consider-

ation has been given to determining whether the size of the proposed facility

will be adequate to accommodate the expected increase in personnel.

The Defense installation realignment announced April 17, 1973. will have

no significant effect on the number of personnel assigned to the MCAS, Yuma.

Officials at the MCAS, Yuma, advised the investigative staff that the modifi-

cations ordered by HQMC make the facility less pleasing esthetically but also

make it less expensive to build and do not interfere with the ease of operation.

The cost estimates on the PCE were prepared by the firm doing the architec-

tural and engineering survey and were reviewed for reasonableness by NAVFAC.

NAVFAC bases their cost estimates on the cost of similar completed projects

adjusted by a factor for the increase in costs of materials and labor and an

additional factor for the geographical location of the project. NAVFAC found

the costs set forth in the architectural and engineering survey to be very close

to those calculated by NAVFAC.

The status of the design, as of the date of the preparation of this report, is

that the PCE has been submitted and approved. On April 16, 1973, a 30 percent

complete design was submitted by the architectural and engineering contractor

and was being evaluated by NAVFAC personnel. On June 29, 1973, a 100 percent

complete design is due from the architectural and engineering contractor. On

August 8, 1973, the design is scheduled to be released by NAVFAC.

117

DEPARTMENT OF DEFENSE'S RECOMMENDED CORRECTIONS TO STUDY OF COMISSARY

FACILITIES FOR HOUSE APPROPRIATIONS COMMITTEE INVESTIGATION STAFF

Page 5, paragraph C. Army

Change first paragraph to read: "As with the Air Force, the Army's surcharge

is 3 percent in the Continental United States and 2.5 percent overseas added to

the customer's bill at the cash register with the surcharge moneys being con-

trolled centrally through the Trust Revolving Fund Account."

Pages 12 and 13 (last 2 lines, page 12, and lines 6 and 7, page 13)

Change to read: "The current project at Hickam AFB is for 73,500 square feet.

One existing warehouse of 21,000 square feet will be retained; so with comple-

tion of the new commissary, 94,500 square feet will be for commissary use

which is 86 percent of the 109,500 square feet authorized by DOD construction

criteria.

'The current project at Bergstrom AFB is 81,000 square feet which along

with a 6,048 square foot warehouse. * * * "

Change is necessary as the cold storage warehouse (10,700SF) is in support

of troop issue, rather than commissary resale. Air Force representatives incor-

rectly indicated to the investigative staff that the cold storage plant should be

considered in comparing the total commissary store requirement to the space

criteria.

QUESTIONS AND RESPONSES

Question. When several military installations are located in proximity to one

another, why do the services not coordinate their commissary activities for the

good of the whole, rather than each establishing facilities for his own personnel?

Answer. The availability of commissary stores on other military installations

is considered prior to reaching the decision to plan for a new facility. However,

one of the primary considerations is a convenient location of the commissary

store to the patron. Traveltime by both private and commercial conveyance to

military and commercial shopping facilities and the number of patrons quartered

on an installation are foremost among the criteria established by the DOD

prior to constructing a new store. One large store required to serve a geographic

area could create problems of economy and management due to its size and could

possibly be eliminated as a result of future base closures, leaving the area patrons

without a commissary store. Additionally, convenient location to all authorized

patrons would be extremely difficult, if not almost impossible, under any con-

solidation concept.

Question. Why hasn't DOD adopted the 1970 recommendation of the House

Armed Services Committee that the surcharge be increased slightly to provide

funds for commissary construction?

Answer. The House Armed Services Committee, in 1970, expressed concern

over the growing trend to use nonappropriated funds in lieu of rather than as

a supplement to appropriated funds, which in effect, requires the service members

to subsidize essential morale and welfare facilities and programs. It was also

recognized that a surcharge for store construction could be viewed as a reduction

in the service member's pay and an assumption, in part, of the Government's

responsibility. It was the further view of the committee that an increase in

surcharge for commissary construction as suggested by the services was accept-

able only after a departmental determination that every effort has been made

to secure appropriated funds for this purpose. The military departments at this

time, are continuing their efforts to secure appropriated funds, however, the pos-

sibility of a nominal increase in surcharge to finance commissary construction

and enabling legislative authority remains under active consideration.

Mr. SIKES. Thank you very much, Mr. Secretary. This has been a

very useful hearing. A good job.

Mr. SHERIDAN. We appreciate your support at gall times, and your

courtesy and the courtesy of the committee, and also Mr. Nicholas'

help.

Mr. SIKES. Thank you very much. We have had a very fine rapport

between the committee and the Department. We are getting some re-

sults to show for it.

MONDAY, MAY 14, 1973.

MILITARY FAMILY HOUSING PROGRAM

WITNESSES

PERRY J. FLIAKAS, DIRECTOR FOR FACILITIES PLANNING AND

PROGRAMING, OFFICE OF THE DEPUTY ASSISTANT SECRETARY

OF DEFENSE (INSTALLATIONS AND HOUSING)

SIGMUND I. GERBER, DIRECTOR FOR CONSTRUCTION STANDARDS

AND DESIGN, OFFICE OF THE DEPUTY ASSISTANT SECRETARY OF

DEFENSE (INSTALLATIONS AND HOUSING)

JOHN F. ROLLENCE, ACTING DIRECTOR OF HOUSING PROGRAMING,

DIRECTORATE FOR FACILITIES PLANNING AND PROGRAMING,

OFFICE OF THE DEPUTY ASSISTANT SECRETARY OF DEFENSE

(INSTALLATIONS AND HOUSING)

BRIG. GEN. HUBERT O. JOHNSON, JR., U.S. AIR FORCE, DIRECTOR

FOR FACILITIES MANAGEMENT, OFFICE OF THE DEPUTY ASSIST-

ANT SECRETARY OF DEFENSE (INSTALLATIONS AND HOUSING)

ARTHUR B. CRAP, DIRECTOR FOR MANAGEMENT RESOURCES, DI-

RECTORATE FOR FACILITIES MANAGEMENT, OFFICE OF THE

DEPUTY ASSISTANT SECRETARY OF DEFENSE (INSTALLATIONS

AND HOUSING)

GEORGE D. BRUCH, OFFICE OF GENERAL COUNSEL, OSD

MAX FOLLMER, CHIEF HOMEOWNERS ASSISTANCE PROGRAM DIVI-

SION, CORPS OF ENGINEERS, DEPARTMENT OF THE ARMY

OPENING STATEMENT BY THE CHAIRMAN

Mr. SIKES. Mr. Fliakas, we are glad to have you here this after-

noon to discuss the military family housing program.

The committee reserved many of the questions on family housing for

your appearance, despite our eagerness to discuss this very important

subject earlier.

I am glad there is evidence of progress in many areas in family

housing. The unprecedented amount of new construction that has

been built in the civilian sector in the past 3 years combined with the

military pay increases have gone a long way toward making your

long-range deficit in this area a manageable problem. Also the mili-

tary family housing construction program is beginning to have a sig-

nificant effect.

Similarly, the shrinking size of the Armed Forces has helped to

alleviate the shortage of housing at many bases. There is also a greater

recognition by the people involved in managing this program and

controlling it, both in the executive branch and in the Congress, that

we must make every reasonable effort to provide adequate and attrac-

tive housing to our military families in order to have a high-quality

military force. It is a very important morale factor. I know that you

are in agreement with these objectives.

(119)

I believe that your program this year indicates that you have been

effective in carrying them through. This committee has given en-

couragement. and support for the housing program. We are gratified

to see the progress that is being made. We intend to do what we can

to see that this progress continues.

STATEMENT OF DIRECTOR OF FACILITIES PLANNING AND PROGRAMING

(INSTALLATIONS AND HOUSING)

We will hear your statement.

JMr. FLIAKAS. Thank you.

Mr. Chairman and members of the committee, I am pleased to ap-

pear before this committee to present the military family housing

program for fiscal year 1974. The programs included in the budget

request before you reflect the continuing emphasis being placed by

the Department of Defense on the maintenance of our forces and the

welfare of our individual servicemen. As stated by the Secretary of

Defense, adequate housing is a morale factor of prime importance.

The principal objective of this program, therefore, is to assure that

married members of the Armed Forces have suitable housing. To this

end, the objectives of the military family housing program are closely

alined and dovetail with the objectives of the zero draft and the all-

volunteer force.

PROGRESS COMPARED TO PREVIOUS YEARS

We are pleased to be able to report continued and significant prog-

ress in providing more adequate housing on base, for upgrading the

condition of our existing inventory, and in securing suitable quarters

off-base in the community for our military families. These improve-

ments and program increases have been built up by gradually in-

creasing annual increments in our Defense budgets beginning with

fiscal year 197, and continuing in each successive annual program

since then. The request for fiscal year 1974 for the appropriation,

"Family housing, Defense," amounts to $1,250,567,000.

You have before you a table showing a comparison of this year's

proposed appropriation with pertinent element breakouts for a 5-year

span. You will note that the trend and growth pattern are significant.

[The table follows:]

FAMILY HOUSING DEFENSE, SUMMARY OF SELECTED APPROPRIATED AMOUNTS

Enacted fiscal year-

- Request fiscal

1970 1971 1972 1973 year 1974

New construction $105, 507 $194, 833 1$255, 740 $270, 987 $351,904

Number of units.. (4,800) (8,000) 1(9,862) 2(11,938) (11,688)

Mobile home facilities .. . 0 1, 200 7, 280 5, 387 57

Number of spaces. ....... (0) (439) (2, 350) (1,403) (1,340)

Improvements 11,540 19, 196 31,668 39, 498 62,510

Leasing . 23, 658 28, 684 33, 589 37, 643 44,703

Number of leases, end year ... . (9, 660) (11,466) (13, 482) (13, 964) (17,262)

Operation and maintenance 373, 219 395, 686 440, 706 535, 842 622,913

Tetal appropriation_ 688,476 806,474 1945,025 1,064,046 1,250,567

I Includes 430 units for $11,070,000 fcr Safeguard sites enacted in the DOD Appropriation Act, Public Law 92-204.

2 Includes 218 units for Safeguard site authorized in Public Law 92-436, but which are to be financed from savings, and

for which no appropriation was made.

Mr. FLIAKAS. The fiscal year 1974 appropriation request of $1,250.6

million compares with $1,064 million for fiscal year 1973, an increase

of $186.6 million or approximatley 18 percent. One of the principal

features is the proposed construction of 11,688 new family housing

units. The number of units for new construction in the fiscal year 1974

program continues the high level attained in the previous 3 years and

is nearly six times as many new units as were in the program just 5

years ago. To illustrate the dramatic growth in the new construction

program, I would like to repeat the figures. In fiscal year 1969 only

2,000 units were programed; in fiscal year 1970 the amount was in-

creased to 4,800; in fiscal years 1971 through 1973 we obtained an aver-

age of almost 10,000 and in this year's program 11,688 new family

housing units are requested. This significant growth has been realized

only with the complete support of this congressional committee with-

out whose cooperation there could not have been the same measure of

progress.

Other important elements in this year's construction program are

mobile home spaces to provide safe, sanitary, and reasonably priced

accommodations for those servicemen who own mobile homes and a

total of $62.5 million in the improvement and alteration of existing

public quarters to modernize and renovate older and deteriorated

units. The military departments have estimated a backlog of over $700

million in necessary improvements to upgrade our inventory. I know

of no program that will pay quicker dividends and provide such sub-

stantial benefits in terms of increased morale to the military families

who occupy on-base housing as well as provide increased life and

livability to the structures themselves.

The balance of the fiscal year 1974 request covers minor construction

and planning as well as annual costs for leasing, operation and main-

tenance, and debt payment. Total appropriations requested are $423,-

774,000 for the construction requirements and $826,793,000 for the

0. & M. and debt payment portion or a total of $1.250,567,000.

Now, I would like to discuss briefly some of the features of this

year's program and to highlight the subjects that are of particular

interest to this committee.

PROGRAMING

DOD policy with respect to housing our married military service-

men is to rely on the local civilian housing market in communities near

military installations as the primary source of family housing. Only

when community support is limited or inadequate as to cost, distance,

or quality, do we seek authority to construct on-base housing. Particu-

lar care has been taken in the programing review to assure that our

request for new construction reflects requirements only at hardcore

installations. Because of this concentration on hardcore bases, coupled

with the recent 5-year buildup of new construction and continued re-

liance on the local community, our programable deficit is now esti-

mated to be about 60,000 units. This compares with prior estimates

in recent years of 90,000 to 110,000. The reasons for the reduction of

the deficit to what is now considered to be a manageable level, are the

declining force structure, the contraction of our base establishment,

and the cumulative effect of recent military pay raises, particularly in

the lower grades, which put more community housing within the eco-

nomic means of our servicemen. As in previous years, we continue to

place the most attention on the on-base construction to enlisted and

junior officer units. This year's program includes about 11,000 units or

94 percent of the total program for these categories.

CONSTRAINT ON PROGRAMING 2-BEDROOM UNITS

Now I would like to say a few words about the bedroom composition

of our program request. Each year, a substantial part of our program

has been concentrated on the new construction of two-bedroom units.

This was based on programing calculations using actual surveys at in.

dividual bases that show statistically, a need for two-bedroom units.

The military departments have recommended that the proliferation of

this size unit in the inventory be controlled and the Congress also has

questioned this requirement. Indeed, the report of this committee last

year was especially critical of what was considered a preponderance of

two-bedroom units in the fiscal year 1973 program and directed action

to preclude the saturation of our military bases with such units. In the

fiscal year 1974 program you will see, therefore, a programing policy

applied to the makeup of the program which limits the number of

two-bedroom units at any one base to 30 percent of the enlisted and

junior officer inventory at that base. Our rationale for this is as follows:

(1) The two-bedroom unit is the predominant size found in the local

community. The three- and four-bedroom units are scarce and those

available are normally priced beyond the serviceman's ability to pay.

(2) A military controlled three-bedroom unit onbase offers more

flexibility for assignment purposes. This policy will enhance maximum

utilization and flexibility of assignment on post.

(3) As we move toward an all-volunteer force, we expect the troop

composition to stabilize. Our statistics based on experience to date

have been largely draft driven. As we develop a more permanent force,

more stability in terms of marital rates and consequently more chil-

dren will result. So we think that we can look for an increase in bed-

room requirements as our force matures and becomes more permanent.

Our conclusion, therefore, is to establish a general programing pol-

icy that puts a constraint on the number of two-bedroom units to be nor-

mally constructed at any one base. We have established a 30-percent

factor as being realistic and responsive to this concept. We will, of

course, look at each installation on a case basis to determine the appli-

cation of this policy.

INCREASED SPACE LIMITATIONS

Now I would like to turn to a discussion of the construction stand-

ards for the maximum square foot limitations on floor area prescribed

for military family housing by the United States Code. As you know,

we are constrained by specific maximum limits on size by rank or grade

of the military occupant. These limitations have not been upgraded in

years with the result that today, we are building to standards that no

longer meet the lifestyle of modern day living. Research on civilian

housing design trends and a survey of information and opinions of our

own military servicemen and their wives as to the adequacy of military

housing, indicate a critical need for additional floor area to accom,

modate contemporary living habits and requirements.

As a result of these surveys and analysis of current statutory net

area limitations, we are requesting changes which will allow appro-

priate increases in dining areas, secondary bedrooms, and the bath-

room area and the appropriate circulation space required to support

the enlarged areas. The total impact of the requested increases will be

improved overall livability.

We have worked very closely with the military departments on the

review of space requirements and have been very selective on the appli-

cation of increases. A comparison chart showing the current statutory

limits and the proposed changes is attached to my statement. The in-

creases range from zero to 11 percent. For example, we are seeking no

change in space criteria for general officers but an increase of 120 square

feet or 11 percent for a three-bedroom enlisted unit. Another increase is

for 50 square feet or 4 percent for a four-bedroom company grade officer

unit. In addition, we are proposing that the maximum space limita-

tions for senior enlisted personnel in the grades E-7 through E-9 be

the same as those for junior officers. The military departments were

unanimous in their recommendation that senior enlisted personnel

be accorded this benefit commensurate with their extended service.

Also, a benefit will accrue to the base management of the inventory

by affording greater flexibility in assignment of housing between jun-

ior officers and senior NCO's. However, due to budget considerations,

the number of enlisted units proposed for construction in the fiscal

year 1974 program at the higher senior enlisted standards have been

held to only 30 percent.

COST LIMITATIONS

Next, I would like to discuss the statutory average unit cost limita-

tion on the construction of military family housing and where we

stand with respect to the adequacy of the current Conus limit. As

you know, the Department of Defense did not seek a cost increase last

year so that the fiscal year 1972 limit of $24,000 applies also to 1973.

This appeared appropriate at the time because of judgments and cost

growth projections that proved flow to have been understated. For

example, it was 'believed that a normal cost growth during this period

would be offset by the content and geographic location of our 1973

program-that is, more enlisted and junior officer units including a

liberal number of two-bedroom units, in lower cost regions of the

country. ,lso, certain exclusions from the average unit cost were re-

questea but were not favorably considered by the Congress. These

were the exclusion of land acquisition and offsite development costs.

These considerations have now 'been overtaken by events, namely the

spiraling costs of construction. Consequently, the military departments

have been required to take an increasing amount of deductive alterna-

tives in order to make contract awards within available funds for those

projects being competitively bid; and for turnkey projects, a reduction

m quality and/or desired scope is being realized because of the cur-

rent fiscal constraints. Sufficient experience is not available as yet for

the fiscal year 1973 program but, based on the actual cost growth of

8.5 percent for calendar year 1972 it is expected that we will have

difficulty with a majority of the projects which can only result in

7pilizing the resultant housing and its occupants because of quality

deficiencies.

Based on the above, the proposed fiscal year 1974 program average

cost of $27,500 for units constructed in the United States exclusive of

Alaska and Hawaii reflects the updating of the fiscal year 1973 average

unit cost to eliminate quality deficiencies.

In addition, a cost growth factor of 6 percent is included. Authorita-

tive construction cost indices such as reported by Engineering News

Record had predicted a 7 percent cost growth for building construc-

tion for calendar year 1972. The.actual increase however amounted to

8.5 percent. This experience reflected a sharp rise especially in the

cost of plywood and lumber. We now believe this to be conservative

because as of this date, the increasing trend has not shown any sign

of leveling off.

We understand that the proposal before you is ambitious. But we

believe firmly that this is the proper direction; that is, to upgrade

our standards and to establish realistic goals and prices accordingly.

If spiraling costs are not halted, then we may not 'be able to accomplish

all we have set forth in this request. But, these standards should be

established as a target to shoot for in order to get the most house for

the dollar and for the occupant within reasonable limits.

DOMESTIC LEASING, FOREIGN LEASING, AND RENTAL GUARANTEE

PROGRAMS

The domestic leasing program authorizes under specific criteria and

cost limitations, the lease of housing in the civilian community in the

United States, Puerto Rico, and Guam for assignment to military

personnel as public quarters. In the fiscal year 1972 program, primarily

based on providing leases for personnel assigned to recruiting activi-

ties in support of the all-volunteer force, the statutory limitation on

the number of domestic leases was increased to 10,000. All of these have

been allocated to the military departments and approximately 87

percent are currently under lease. About 3,000 leases are allocated to

the recruiting commands. We plan to continue this program as an

important supplement to our balanced program for the acquisition

of adequate housing both in the community and on-base. No changes

are proposed in the fiscal year 1974 program.

Foreign leasing of family housing is authorized under the general

authority of 10 U.S.C. 2675. A limited number of units have been

leased under this authority primarily for persons occupying special

command type positions or to alleviate undue hardship cases. How-

ever, it is believed that leasing, particularly lease-construct agreements

in selected overseas locations, represents a viable potential for pro-

ducing additional housing for military families in foreign countries

with limited risk for the U.S. Government. Accordingly, the fiscal year

1974 program request reflects an expanded foreign leasing program

for 7,262 units and $19.9 million, an increase of 3,298 units and $6.8

million.

Another method of acquiring military family housing in overseas

locations is the rental guarantee program. By Public Law 88-174 as

amended, the Secretary of Defense is authorized to enter into agree-

ments guaranteeing the builders of such housing a return equivalent

to a specified portion of the annual rental income which would'be

received if the housing were fully occupied. These projects are pri

vately financed, and constructed and maintained by the sponsor for

occupancy by U.S. military personnel on a rental basis. The guarantee

period is limited to 10 years under existing legislation. A total of 2,415

rental guarantee units are under contract in Spain, the United King-

dom, Germany, and Korea. We are exploring the feasibility of obtain-

ing additional rental guarantee projects but do not consider it possible

without an increase in the average guaranteed rental ceiling. The

present ceiling of $225 per unit, per month was authorized last year.

However, the international economic situation, compounded by in-

creased construction costs in foreign countries, has made this ceiling

obsolete. For example, the deutschemark was revalued upward, and

this was followed by the recent devaluation of the dollar. Meanwhile,

construction costs have increased substantially. Consequently, we are

requesting that the average guaranteed rental be increased to $275

per unit per month to permit the continued effect use of this

program.

We believe that these programs, administered wisely in selected

locations, will provide suitable family housing for our military serv-

icemen at a minimum risk to the U.S. Government, especially in areas

where U.S. military tenure could be subject to change.

STATUS OF SECTION 236 PROGRAM

Now, I would like to report on the status of the section 236, low-

income community housing program for our military service families.

As you know, section 120 of the Housing and Urban Development

Act of 1970, which was sponsored by Chairman Sikes, specifically au-

thorized military occupancy preference in rental housing assisted un-

der title II of the National Housing Act. As a result of this legislation,

the Department of Defense entered into an interdepartmental agree-

ment with HUD/FHA, covering the development of assisted housing

projects for occupancy by lower grade military families on a priority

basis. FHA and DOI) agreed to a listing of 4,300 units in fiscal year

1971 and 5,050 units in fiscal year 1972; of these 9,350 units, 6,976,

or 75 percent, were completed, under construction, or covered by let-

ter of feasibility at the time of the administration's "freeze" on sub-

sidized housing in January of this year. We are awaiting clarification

by HUD on the effect of the "freeze" on the uncommitted balance of

the units from the fiscal year 1971-72 programs as well as on our

request for additional units proposed for fiscal year 1973.

During the early stages of developing this program, it was antici-

pated that most enlisted personnel and some junior officers would

benefit from the program by being able to meet the income limitations

set for Section 236 projects. However, as the result of recent sizable pay

increases, continued applicability of this program to military families

at all locations, is expected to decline. Within this context, we will

continue to seek allocations from HUD in those areas where a military

"set-aside" project is warranted.

In the meantime, we are continuing to work with HUD to resolve

the problem of nonavailability of FHA insured programs in "military-

Impacted" areas. We have developed proposed legislation which would

permit HUD to insure private housing under the Special Risk Insur-

ance Fund in areas heretofore considered uninsurable. Briefly, our

proposal provides that in federally-impacted areas where the residual

housing requirements are insufficient to sustain the housing market in

the event of curtailment of employment, the Secretary of HUD may

require a certification from the Secretary of Defense that there is no

intention insofar as can reasonably be foreseen, to curtail substantially

the personnel assigned or to be assigned to the installation concerned.

Enactment of this proposal would greatly increase the supply of hous-

ing for DOD personnel at selected installations in nonmetropolitan

areas, and further assist in the orderly development of a number of

federally-impacted communities. Most importantly, the availability of

reasonably priced community housing at installations remote from

metropolitan areas would contribute greatly to the morale of the

lower pay grade military personnel who are vital to achieving the ob-

jective of the all-volunteer force.

BASE CLOSURE IMPACT ON FAMILY HOUSING

On April 17, 1973, Secretary Richardson announced 274 actions to

consolidate, reduce, realine, or close military activities. There are

13,366 family housing units affected at locations scheduled for closure.

Of these, only 3,520 units, or 26 percent have been built with appro-

priated funds and less than one-third of those-about 1,000-since

1966. The balance are Wherry, Capehart, and other public quarters,

including about 300 inadequates. We expect to retain 900 units at

Naval Air Station, Albany, Ga., for use by the Marine Corps Supply

Center, and 668 units at McCoy Air Force Base, Fla., for use by the

Naval Training Center, Orlando. The military departments are re-

viewing their family housing needs at the other locations. Their

review will provide a basis for my office to determine how many of the

remaining 11,798 units can be retained by the owning service, how

many can be used by another military service, and how many may be

excess to Department of Defense requirements. The excess housing

will then be reported to General Services Administration in the usual

manner, where it will be screened for other Government use, and dis-

posed of by sale or otherwise if no use is found. Every precaution will

be taken to minimize any possible adverse economic impact on sur-

rounding communities.

MINOR CONSTRUCTION

It is well known that this committee has a particular interest in

improving the lot of the lower ranks and grades of military person-

nel. Toward this end, this committee added $15 million to the 1972

appropriation and $13.3 million to the 1973 appropriation for minor

construction projects to improve the family quarters of junior officers

and enlisted personnel. The military departments developed programs

for rapid and effective use of these added amounts and my office

reviewed them to assure the intent of Congress was met. Some individ-

ual projects have been completed, and many more are well underay.

The improvements which result from these projects are clearly evident

to the occupant. Typical projects to improve livability include utility

connections for clothes washers and dryers, improved heating and elec-

tric service, installation of dishwashers, garbage disposers, and air-

conditioning where applicable.

INADEQUATE HOUSING

Public Law 92-545, approved October 25, 1972, authorized the Sec-

retary of Defense to designate as inadequate not more than 20,000

family housing units in addition to those-about 12,000-we already

have. In accordance with congressional intent, units designated as

inadequate are those which cannot be economically upgraded to meet

standards of adequacy. The 20,000 units were allocated equally to the

3 military departments-6,659 each and 23 units to DSA. Most of these

units were placed on a rental basis not to exceed 75 percent of the

occupant's BAQ, on January 1, 1973, by the Army. Air Force, and

Marine Corps. However, the Navy will not be able to implement the

authority until July 1, 1973, since military pay and allowance funds for

fiscal year 1973 are not sufficient to permit payment of the partial BAQ

which will be due to occupants of the inadequate rental units.

CONCLUSION

I have touched briefly on the main elements of this year's military

family housing program. The Department of Defense is deeply com-

mitted to the housing needs of the serviceman and we will continue

to develop and recommend programs to meet those needs. In sum-

mary, I would say that the DOD military family housing program

reflects a balanced approach to achieving our objective of decent and

adequate housing for all servicemen and their families, by continuing

a prudent and moderate onbase construction and improvement pro-

gram coupled with an aggressive policy for obtaining suitable off-base

housing in the civilian communities near our military installations.

I would like to express my appreciation for your continuing support

of the Department of Defense family housing program. My staff and

I are available to answer your questions and would be pleased to pro-

vide such additional information as you may request.

Thank you.

[Enclosure: Proposed fiscal year 1974 space criteria; see p. 142.]

Mr. SIKES. Thank you, Mr. Fliakas. This is a very good statement

and represents an important contribution to the committee's record and

to the information we require for consideration of this bill.

FAMILY HOUSING BACKLOG

Mr. Sheridan stated that the estimated backlog of family housing

construction has been reduced from $2.3 billion reported last year to

$1.6 billion this year. How much of this is due to the increase in the

maximum allowable housing cost ?

Mr. FLIAKAS. Our estimate of the adequate community housing

support based on our latest surveys, is an increase of about 143,000

units. However, this does not result in a gross reduction of our deficit

because it was offset by an increase of about 117,000 military families

resulting from increased marital factors and, again, our latest world-

wide survey data. So, we have a net decrease attributed to community

support of about 26,000 units.

Mr. SIKES. What other factors have reduced the backlog?

Mr. FLIAKAS. Our deficit from last year to this is changed by several

factors; the construction of the fiscal year 1973 housing program,

20-192 (Pt. 1) 0 - 73 -- 9

128

normal losses to the inventory, the declaring of 20,000 units of on-base

housing as inadequate as was authorized by the Congress last year, and

the changes in community support and numbers of military families

as was discussed previously. I would like to insert for the record our

computation of how each of these factors affected our programable

deficit.

[The information follows:]

EXPLANATION OF DEFICIT DECREASE

Programable deficit reported last year------------------------------ 96, 700

Increase due to inventory loss ---------------- --------------- 21, 241

Increase due to less voluntary separations-------------------------- 1, 781

Decrease due to fiscal year 1973 execution program---- --------- --11, 810

Less programable deficit reported this year------------------------- -59, 782

Net decrease in deficit---------------------------------------48, 130

Increase in community support--------------------------------- --- 142, 635

Less increase in number of families------------------------------- -117, 134

Net gain in community support 2----------------------------- 25, 501

Increase in safety factor ----------------------------------- 22, 629

'Adequate units to be declared inadequate under new authority-------------- 20, 000

Adequate units to be lost through attrition-------------------------------- 467

Adequate units lost due to inventory differences reported from June 30, 1971,

to June 30, 1972------------------------ ---------------------------- 774

21, 241

2 Due to more accurate data reported by the military departments this year, it was possi.

ble to apply marital rate factors to personnel categories vice a gross personnel figure last

year; this resulted in a significant increase to the number of estimated families. This

increase was offset by a gain in community support approximating 9.9 percent; last year

community support accounted for 33.4 percent of gross requirements while this year it

accounts for 43.3 percent. The increase in community support can be attributed to two

factors; that is: Increased pay and allowances which in turn increased the MAHC; and,

inclusion of housing surveys for installations with a higher degree of community support

than the norm.

S The safety factor was increased for two reasons ; that is : Because of the significant gain

in effective requirements (or number of families) : and, because more accurate data was

provided by the Military Departments on the magnitude of overseas and U.S. requirements.

The safety factor used last year was a straight 10 percent, while this year it equates to

about 11.1 percent.

Mr. SIKES. Does the $1.6 billion backlog include the estimated $700

million which will be required for improvements?

Mr. FLIAKAS. No, sir, it does not. This is strictly in terms of new

construction.

Mr. SixES. I would like for the record the 5-year family housing

program, showing estimates of programable and total deficits at the

end of fiscal year 1974 and at the end of fiscal year 1978.

[The information follows:]

Using the projected strength for end fiscal year 1978 as a base, the program-

able and total deficits for eligible personnel will be 48,094 and 158.534, respec-

tively, assuming we build the 11.688 units requested for fiscal year 1974, and, by

the end of fiscal year 1978 assuming new construction of 44.830 units as contained

in the services' FYDP's, the programable and total deficits will be reduced to

3,264 and 113,704, respectively.

Mr. SIKES. What is the estimated programable deficit in terms of

units ?

Mr. FLIAKAS. As reported by the services in their 5-year defense

program, we now estimate the programable deficit at about 60,000

units.

Mr. SIRES. Does that include the E-4's?

Mr. FLIAKAS. It does.

Mr. SIRES. What is the total number of military families of all

grades who will not be properly housed?

Mr. FLIAKAS. Using the personnel strength for the projected end

fiscal year 1978 position, we estimate that the total number of military

families that will not be suitably housed to be about 212,000. Essen-

tially, this is the programable deficit of 60,000, plus the safety factor

that we compute as part of our installation reports, and those per-

sonnel unsuitably housed in grades E-1 through E-3 considered

"ineligible" for programing purposes.

Mr. SIKES. How many of those are in the enlisted grades E-1

through E-3?

Mr. FLIAKAS. Approximately 42,000.

Mr. NICHOLAS. Do those 42,000 represent the deficit in that area ?

How many of those people are adequately housed ?

Mr. FLIAKAS. That figure is estimated to be about 100,000, for those

suitably housed; this number subtracted from about 142,000 total

families in grades E-1 through E-3 gives us the estimated deficit for

ineligibles of 42,000.

Mr. RHODES. Would you care to clarify the disparity between the

60,000 deficit and the 212,000 figure which you gave?

Mr. FLIAKAS. In order to avoid overbuilding at any one installation,

we have a programing policy that prescribes that a 10 percent safety

'factor be applied in the Conus installations and a 20-percent safety

factor be applied in overseas installations.

Of course, when we reach a position of authorizing a terminal proj-

ect at an installation, that is, to fill the total demand, we will, of course,

waive that on certain conditions, particularly at hard core installations

or, for example, at the academies, where we know we can predict a cer-

tain strength on into the future.

But for programing purposes we allow a 10-percent safety factor

in the United States.

Mr. RHODES. Ten percent of what ?

Mr. FLIAKAS. Of the effective requirement, which takes into con-

sideration our worldwide population, extended again through 1978, of

about 2.2 million men in uniform.

Mr. SIKES. Is that clear to you ?

Mr. RHODES. No.

Mr. SIKES. It is not clear to me, either. Let us go through it again.

Mr. FLIAKAS. We develop an effective requirement of married

families eligible for military housing against which we apply all of

our adequate assets on-base, our estimate of community support, and

t'h safety factor to arrive at what we call our programable deficit.

Mr. SIRKES. What is that number ?

Mr. FLIAKAS. The effective requirement, sir, is 997,021.

Against this we have applied a safety factor, 10 percent in the

United States, 20 percent overseas, which calculates to 110,440. This

is a reduction against the effective requirement.

Mr. SIKES. You take that off the total requirement, leaving you with

what number ?

Mr. FLIAKAS. That leaves us with a programing limit of 886,000.

Mr. SIKES. Proceed from there.

Mr. FLIAKAS. Against that we apply our assets, on-base adequate

quarters, and then community support, again adequate in terms of

cost, condition, and distance from the installation. We have 373,000

assets, both on-base and in the pipeline, and we project-

Mr. SIKES. By the pipeline, you mean authorized and funded?

Mr. FLIAKAS. That is correct, sir. And also, we project losses to the

inventory through base closures or through attrition.

We also apply the private or community support assets of 453,000-

I am rounding these off-to arrive at a programable deficit of 60,000.

Mr. SIRES. Where does the 212,000 come into the picture?

Mr. FLIAKAS. The 212,000 is made up of 170,000 eligible and 42,000

ineligibles, for a total of 212,000 families unsuitably housed.

Mr. NICHOLAS. These are your current deficits, then, and do not

take into account your projected family housing construction program

over the next 5 years, nor do they take into account the projected,

whatever that may be, 236 or HUD programs ?

Mr. FLIAKAS. That is correct.

Mr. NICHOLAS. This is what you have to aim at.

Mr. FLIAKAS. That is correct.

HOUSING FOR E-1 THROUGH E-3 PAY GRADES

Mr. SIRES. What policy has the Department of Defense now adopted

toward the provision of housing for personnel in the enlisted grades

E-1 through E-3 ?

Mr. FLIAKAS. It is DOD policy for programing purposes, not to

program military housing for military personnel in those grades.

However, as you know, these military personnel may occupy on-base

housing if the requirements of "eligible" families have been met, and

they also occupy on-base substandard housing.

Mr. SIKES. How many units are there in each category, insofar as

you can determine at present ?

Mr. FLIAKAS. I believe this was as of December 31, 1972; occupying

standard quarters, 6,324 ineligible families; and occupying substand-

ard quarters on the base, 5,656-for a total of almost 12,000 families

on base.

Mr. RHODES. Would you define an ineligible family ?

Mr. FLIAKAS. Yes, sir. I personally dislike that term, but it is one

that has been used for many years.

For programing purposes, an eligible family, before we extended

the programing base that the chairman referred to, was considered an

E-4, who is a corporal, with 4 years' service, or with at least 2 years'

service and a 6-year commitment. He also was authorized certain en-

titlements for movement of household goods and travel of dependents.

Two years ago we extended our programing base for ,purposes of

developing our deficit, to all E-4's. We estimated we would pick up

some 50,000 additional personnel in that category.

This year, I am pleased to report, sir, that in the military personnel

appropriations request there is included $59 million to extend these en-

titlements to all E-4's with 2 years' service. So, they are catching up,

so to speak, with the initiative that we took 2 years ago in programing

for military housing.

Mr. RHODES. An ineligible family is the family of a military man of

a grade lower than E-4 or an E-4 who does not have enough time in

grade to be eligible ?

Mr. FLIAKAS. That is correct.

Mr. SIKES. You do not include all E-4's now as being eligible ?

Mr. FLIAKAS. We do include them in programing for housing.

Mr. SIKES. So, it would be E-l's through E-3's who are not eligible.

Mr. FLIAKAS. That is correct. It is this category especially that we

are trying to help in our offbase programs, such as the 236 program.

Mr. SIKES. Are you providing for them in any way other than

through the 236 program, the substandard housing, and the surplus

quarters? Are there any other means by which you are helping provide

housing for the enlisted grades E-1 through E-3 who are not eligible

for on base housing ?

Mr. FLIAKAs. Not in the actual provision of housing, but we do pro-

vide assistance to them in finding quarters in the community through

our housing referral offices at major installations. Every serviceman

on permanent change of station orders is required to report to the hous-

ing referral office. They have had a fine record of assistance in main-

taining listings of rental properties in the community, and they do

refer these people to them.

Mr. SIKES. There has been a gradual modification of restrictions

on housing for those previously considered ineligible. Now, you have

brought the E-4's into the eligible category. Of course, eventually we

must make all of them eligible.

Do you anticipate any change in regulations or any additional con-

struction specifically for the E-1's through E-3's in the next 5 years ?

Mr. FLIAKAS. Not at this time, Mr. Chairman. Of course, the situa-

tion could change. We might and could construct for this category.

We have talked with you and this committee a number of times, pro-

posing construction of junior-sized quarters or something other than

full-sized units of these people, but it is not in the program, and I

cannot say that it is programed in the next 5 years. As I said, the sit-

uation could change.

HUD PROGRAMS FOR FORT HUACHUCA, ARIZ.

Mr. RHODES. I have a question concerning the 236 program, or

.actually the program that you share with HUD. I am thinking of

Fort Huachuca. As you know, we have been trying very hard to get

more housing in Sierra Vista. The problem apparently has been that

HUD has not believed that Sierra Vista is there to stay unless Fort

Huachuca is also there to stay.

We were unable to get them to authorize the construction of units

in large enough numbers to attract contractors of some size who could

do the job economically and quickly.

Have you any new developments on this? I have not heard anything

about it for some months now.

Mr. SIKES. Is that a situation that would be corrected by the lan-

guage which we had hoped to get enacted last year?

Mr. FLIAKAS. Yes, sir, it is. We discussed earlier this morning very

briefly our proposal to HUD to expand their insuring programs into

the so-called military-impacted areas or any Federal-impacted area.

Mr. SIKEs. I refer to a proposal from this subcommittee to the

Banking and Currency Committee. They did include this specific

authorization in the bill which they reported to Congress last fall, but

it was not considered by the Congress as a whole.

Mr. RHODES. So the situation, I am sure, is well known to this com-

mittee and to the Department of Defense.

Mr. FLIAKAS. Yes, sir.

Mr. RHODES. It is not peculiar to the Sierra Vista-Fort Huachuca

situation.

Mr. FLIAKAS. We have included this area as one of our examples of

an installation where we have hundreds of millions of dollars invested

and where it is not contemplated that we would curtail employment

in the foreseeable future.

And other places-for example, Fort Hood, Tex., or Camp Lejeune,

N.C.-where we know we have hard core installations.

We have to be very selective, obviously, in certifying to HUD the

DOD intent to remain at these places. We have to pick only hard-

core installations.

With respect to Sierra Vista, I believe that recently there was

some 236 action, but not a military setaside. It was a regular civilian

program. There has been some attempt, without FHA support of

private enterprise, to provide some housing in those areas.

Mr. Meehan may be able to give us an up-to-date answer.

Mr. MEEHAN. The last time we spoke to the Department of the

Army, they informed us that although FHA was reluctant to go into

the Sierra Vista area with normal FHA insurance, they were opening

it up gradually with 10- to 15-unit commitments at a time. It is our

understanding that the Whitecliff Corp. has gone in and has received

authority from the Phoenix office of FHA to proceed with a 236

project. I believe that will be 60 units. This is not covered by mili-

tary setaside. However, they do expect military people to benefit from

that project.

Mr. FLIAKAS. As I am sure you are aware, I might add we have a

freeze currently in effect now on section 236 projects.

Mr. SIKES. And similar housing.

Mr. FLIAKAS. And similar housing, yes, sir. It is during this interim

period while the freeze is in effect that we are working with HUD

to get our proposal across to them.

SUBSTANDARD HOUSING

Mr. SIKES. Are you utilizing all substandard housing?

Mr. FLIAKAS. Yes, I believe we are. In addition to the some 11,000

or 12,000 units that we have on base, as a result of the authorization

last year that the Congress approved, we have declared an additional

20,000 units substandard or inadequate and have allocated these to

the military departments equally, some 6,600 units apiece, with I be-

lieve 23 units to DSA.

As of January 1, the Army, Marine Corps and Air Force put most

of these units on a rental basis, that is, not to exceed 75 percent of

their BAQ, until such time as the units can be appraised and a fair

market rate established.

The Navy, however, has been unable to implement the approval

because of funding problems that they have in their military person-

nel appropriations. It is expected that they will implement it with the

new appropriations on July 1.

Mr. SIKEs. As additional housing is constructed onbase, how do

you determine which of the so-called substandard housing will be

retained in inventory for use by the people who are eligible for it

and which will be destroyed rather than utilized ?

Mr. FLIAKAS. We have directed the military departments to survey

and identify those quarters that are not susceptible to upgrading and

which can be occupied as substandard quarters until such time as a

decision is made to purge them from the inventory. We have an un-

refined list of some 53,000 additional units that have been identified

by the military departments as marginally adequate. As I say, this is

unrefined. It is a list at this time.

It was proposed at the time that we identified this problem last year

with the Congress as a total of some 70,000 or 80,000 units in the

inventory.

Mr. SIKES. This is a long term thing. How many housing units will

you expect to gain in the next, say, 3 years in the substandard cate-

gory, which could be used for ineligible personnel but which would

become available to them only as additional presently authorized

and funded housing is built ?

Mr. FLIAKAS. At this time, Mr. Chairman, only the additional

20,000 units that we were authorized to declare substandard last year

are contemplated for that purpose. We have not as vet refined this

additional listing, and are not in a position to recommend any addi-

tional units at this time.

Mr. SIKES. Are you making any recommendation with regard to

the declaration of additional inadequate units beyond the level you

have?

Mr. FLIAKAS. Not at this time, Mr. Chairman.

Mr. SIKES. Are there many units still carried as adequate in the

inventory which are really substandard ?

Mr. FLIAKAS. It is to this segment of our inventory that we are

addressing our improvements and alterations program. We hope to

modernize and upgrade these units. We have some $62 million in the

program this year for that purpose.

We hope, through this means, to erase the backlog of some $700

million in improvement projects.

Mr. SIKES. Does that mean you are upgrading substandard housing

to become fully adequate housing?

Mr. FLIAKAS. If I may not use the term "substandard." These are

marginally adequate.

Mr. SIKEs. These are marginal homes which are not in reality sub-

standard. You are proposing to keep the marginal homes in the inven-

tory by improving them ?

Mr. FLIAKAS. That is correct, sir. These are primarily the older

houses, such as Capeharts, for example.

Mr. SIKES. Let us look at the marginal housing that really should

be declared substandard and probably will be. Would you put an

assessment on the number of those that you carry in inventory?

Mr. FLIAKAS. I only have an estimate of some 53,000 units at this

time, sir.

134

SECTION 236 HOUSING

Mr. SIKES. Now let us get back onto the 236 housing program. We

have discussed it.

For the record, tell us again the details of the program, the present

problems, and your proposals for future improvement of the situation.

[The information follows:]

Section 120 of the Housing and Urban Development Act of 1970 authorized

the Secretary of the Department of Housing and Urban Development to specify

military priority of occupancy of rental housing assisted under title II of the

National Housing Act. By interagency agreement, DOD and HUD concentrated

on the section 236 program which provides rental housing for low-income fami-

lies. The program would continue to be administered by FHA for HUD, and

FHA tentatively set aside contract authority to cover 9,350 units in fiscal years

1971 and 1972. DOD designated locations and approximate numbers of units at

each for acceptance by FHA. At the time of the administration's suspension of

activity under federally assisted housing programs on January 5, 1973, 7,387

units were covered by letters of feasibility, in development, or occupied, speci-

fying military priority of occupancy; subsequent to January 5, 1973, letters of

feasibility were withdrawn by FHA on three projects covering 450 units. [A

detailed status report is attached as enclosure 1.]

During the early stages of developing the program, in the 1969-70 time frame,

it was anticipated that most enlisted personnel, and some junior officers would

benefit from the program by being able to meet the income limitations set for

section 236 projects, whereas now, as a result of military pay increases, prob-

able pay grade coverage is reduced to about E-5's and below. Income limitations,

and thereby the pay grade able to qualify for admitttance, vary according to

location; section 236 income limitations are based on 135 percent of public hous-

ing admission limits. For example, the regular income limit for a family of three

at locations in this program range from $5,400 at Fort Carson, in Colorado

Springs, to $9,315 at Fort Richardson, Alaska; E-1's and E-2's would be covered

at the former location, and E-1's through E-5's at the latter. Although the esti-

mated pay grade coverage assumes no family income other than base pay, basic

allowance for quarters (BAQ), and basic allowance for subsistence (BAS), it

is widely known that a high percent of military families in the lower pay grades

have additional income from second jobs and/or due to the spouse also working;

this situation, of course, would tend to reduce the pay grade coverage still fur-

ther. Continued applicability of this program to military families at all locations

has become speculative, although there are insufficient grounds for its complete

abandonment.

A partial listing of locations in the program is attached (enclosure 2) which

shows the adjusted family income used by FIIA in determining eligibility and

probable pay grade coverage. Pay grade coverage at each location will, of course,

vary depending on family size and whether or not there is additional income in

the form of hazardous duty pay, proficiency pay, spouse's income, or second job

by the military head of household.

Since pay and allowances, particularly for the lower pay grades, have in-

creased to a significant degree we have been working with the HUD staff and

have developed draft legislation which would permit FHA to insure all housing

types in areas previously considered uninsurable. We feel this would open up

not only low-income housing in areas near military installations, but also housing

in the higher price ranges as well where, in the past, there has been a significant

gap in program coverage. It is our understanding that the HUD review team

expects to have recommendations completed by September 1973. Information

concerning our specific proposal is provided for the record as enclosure 3.

[ENCLOSURE 1]

STATUS OF SEC. 236 PROGRAM

Letters of feasibility

Units in effect I Frozen 2

allocated

by FHA Units Percent Actual Tentative

Army..............------------------------ 2,250 1,330 59.1 920 (950)

Navy ----------------------------- 3, 650 2,508 68.7 1,142 (1,202)

Air Force....-------------------------- 3, 450 3, 099 89.8 351 (422)

Total.....----------------................-------. 9,350 6,937 -------------- 2, 413 (2,574)

Percent.................-------- --------------. 100 74.2 -------------- 25. 8 (27.5)

Locations impacted by "freeze":

Army:

Fort Benning, Ga..................--------------------------------------------..............................----------............. 100

Oahu, Hawaii........---------------------...............--------------------------------------..................................... 100

Fort Knox, Ky ------------------------------------------..-------------------- 100

Fort Devens, Mass..............................---------------------------------------------------------- 200

Fort Dix, NJ..................................-----------------------------------------.........-----------------........................... 100

Fort Bragg; N.C.........---------........-----...----------...-----.......--.........--------------......................-------- 150

Fort Eustis, Va----------------------.....................................................--------------------------------............ 100

Vint Hill Farms, Va---------------------------.........-----------..................--------------------- 100

Subtotal -------------------------------------------...............................---------------------.... 950

Navy:

Long Beach, Calif............------------------------------------.......................... --------------................ ... 3 250

San Diego, Calif.......................................----------------------------------------------........----------------.............. 52

San Francisco, Calif..........................................---------------------------------------------------------.................. 550

Oahu, Hawaii ...------------------------------...............................................-----------------------------... 100

New York, N.Y..........................................................--------------------------------------------------------------........ 50

Charleston, S.C........-------------------------......................................---------------------------------................. 200

Subtotal. ..............---------------------------------- ----------------------------- 1, 202

Air Force:

Maxwell-Gunter AFB's, Ala.----------......-------...........--------------...............................------------------- 100

Eglin AFB, Fla-----...---..------------------..............................................------------------------------------. 100

Keesler AFB, Miss...................................----------------------------------------.........................-------------------- 122

Pease AFB, N.H-----...-----....---.............-----------------------------.....................................-------------. 100

Subtotal........--------------------------------------............-------------------------- 422

Grand total of units in suspension .................... ..... . ............. .... 2,574

r Letters of feasibility were issued for a number of units different than the tentative set-aside at certain locations. This

column lists the actual number of units covered.

'Since letters of feasibility were issued for a different number of units than the tentative set-aside at certain locations

(see note "A" above) this column reflects two totals for the number of units frozen: The first number reflects the difference

between the total tentative set-aside and the actual number of units covered by letters of feasibility; the number in paren-

theses reflects the total of units tentatively set-aside at locations affected by the freeze.

3 Letters of feasibility were issued on these 450 units prior to Jan. 5, 1973, but were subsequently withdrawn by FHA.

136

[ENCLOSURE 2]

COMPARISON OF MILITARY PAY WITH SEC. 236 INCOME LIMITATIONS, BY LOCATIONS PROGRAMED

E-1 E-2 E-3 E-4 E-5 E-6

Base pay, BAQand BAS -....... $5,548.65 $5,969.85 $6,131.85 $6,747.45 $7,762.65 $9,926.25

Less:

Paid to social security, etc ........ (324.60) (349. 24) (358. 71) (394. 73) (454. 12) (580.69)

$300 for minor. .......... (300.00) (300.00) (300.00) (300.00) (300.00) (300.00)

Adjusted annualfamilyincome-- 4,924.05 5,320.61 5,473.14 6,052.72 7,008.53 9,045.56

Adjusted family income to include

station housing allowancefor-

Fort Richardson, Alaska.. ... .. 5,608.00 6,040.00 6,301. 00 7,438.00 8,592.00 10,755.00

Oahu, Hawaii .. ........... 5,356.00 5,788.00 5,995.00 6,934.00 7,998.00 10,125.00

This calculation assumes wife and husband and 1 minor dependent. The adjusted family income would, of course, be

greater if the head of household "moonlights" and/or his wife has a job and/or the military individual receives flight

hazardous duty, proficiency pay,etc.

Income

Probable pay grade coverage limit for

under assumption of no income family of 3

otherthan base pay, BAQ and (ascending

Location BAS order)

Fort Carson, Colorado Springs, Colo. ... .... _- .... . . . . . E-l, E-2 ------.......... .. ..- - $5,400

Maxwell/Gunter AFB's, Montgomery, Ala ..- ... ..... ....... E-1, E-2-----...... ... . .. .. 5,400

Pensacola, Fla ...... . . . . . . . . . . . . . . . ...... E-1, E-2, E-3...-.. . . ..-. 5,940

Laredo AFB, Tex .. ..... ... .... ... .... ... .... ... .... E-1, E-2, E-3... - 5,940

MacDill AFB, Tampa, Fla .... E-1, E-2, E-3, E-4.------------- 6,075

Fort Benning, Columbus, Ga ..-........... E-l, E-2, E-3, E-4 .. 6,075

Fort Bragg, Fayetteville, N.C. ......... E-1, E-2, E-3, E-4 .......... 6,075

NC, Charleston, S.C . ... -.. . -. E-1, E-2, E-3, E-4....... 6,075

Shaw AFB, Sumter, S.C -.-..6.1-.... .... ......... ... . . E-l, E-2, E3 6-4......... .... 6,075

Eglin AFB, Valparaiso, Fla .......... E-1, E-2, E-3, E -------------. 6,210

Keesler AFB, Biloxi, Miss .-- - - - - - - - - - - - - - - - E-1, E-2, E-3, E-4 -.. . . . 6,210

Grand Forks AFB, N. Dak......... . .... . .... ... E-l, E-2, E-3, E-4 ...... .. 6,210

NAS, Memphis, Tenn---.. ..... .. E-1, E-2, E-3, E-4 - -- 6,210

Davis-Monthan AFB, Tucson, Ariz ........... E-, E-2, E-3, E-4 .. ..... 6,345

NAS, Jacksonville, Fla ---- E-1, E-2, E-3, E-4 . ..... .... 6,345

Fort Meade, Odenton, Md--..... E-1, E-2, E-3, E-4 ........ - 6,345

Fort Eustis, Newport News, Va ..............6....... . E-1, E-2, E-3, E-4 . ....... 6,345

Fort Lee, Petersburg, Va. . . . . . . . . ..--. . . . . . . . E-1, E-2, E-3, E-4 .... .... . 6,345

South Bay, San Francisco, Calif .... .... ... ...... ....... ...... E-l, E-2, E-3,E-4 .... . .... . 6,415

Lowry AFB, Denver, Colo ....---... ---------------------.. E-l- E-2, E-3, E-4 ....----.... 6,480

Richards-Gebaur AFB, Kansas City, Mo................ _ E-1, E-2, E-3, E-4 ..... . 6,480

NC, Norfolk Va --------------....-------------------- E-l, E-2, E-3, E-4------.......------.... 6,480

Langley AFlB, Hampton, Va ..---------------.. .. . E-1, E-2, E-3, E-4 ... --------- 6,480

North Bay, San Francisco, Calif .......... ..................... 1 E-, E-2,E-3, E-4---...--...... 6,615

Pease AFB, Portsmouth, N.H..-- ------------------ .. E-1, E-2, E-3, E-4 ... _.. 6,685

Fort Ord, Monterey, Calif -......... .. . .. .. . .. . .. .. . .. . E-1, E-2, E-3, E-4 ......... . . 6,750

NC, Newport, R.I...---.................---------------------------------.. E-1, E-2, E-3, E-3, 4------........---. 6,750

MCB, Camp Pendleton, Calif ......----------------------------- E-1, E-2, E-3, E-4 6,885

San Diego, Calif ................... _ E-1, E-2, E-3, E-4 .. 6,885

Fort Monmouth, Redbank, N.J--------.~..... ---------------- - E-1, E, E E-3, E-4.......... 6,915

Norton AFB, San Bernardino, Calif ...... ....... ...... ......_. E-1, E-2, E-3, E-4, E-5 ...._ 7,020

Offutt AFB, Bellevue, Nebr ..---...... --------------... E-1, E-2, E-3, E-4, E-5....... 7,020

Fort Belvor, Va---- ------------------------------ E-1, E-2, E-3, E-4, E-5.... 7,020

NC, Long Beach, Calif.............------------------------------ E-, E-2, E-3, E-4, E-5 7.... 17,155

East Bay, San Francisco, Calif--- ..------------------ E-1, E-2, E-3, E-4, E-5... 7,155

West Bay, San Francisco, Calif -----.......-.-................ .... E-1, E-2, E-3, E-4, E-5... ..... 7,155

NC, Washington, D.C ------------------------------ E-1, E-2, E-3, E-4, E-5..- 7,290

Homestead AFB, Fla ----.......... --------------------------- E-l, E-2, E-3, E4, E-5 ....... 7,425

Fort Dix, Trenton, N.J --------------------------------- E-, E-2, E-3, E-4, E-5 ......... 7,425

Quonset Point, Davisville, R.I.-.............--------------- - E-1, E-2, E-3, E-4, E-5 _- 7,560

Bolling AFB/Andrews AFB, Camp Springs, Md .._... . ............. E-l, E-2, E-3, E-4, E-5 .. 7,775

Nellis AFB, Las Vegas, Nev .........._..... ................ . E-1, E-2, E-3, E-4, E-5 ........ 8, 100

USA installations and NC, Oahu, Hawaii.... ....... ...... . _ E-1, E-2, E-3, E-4, E-5....... 8,235

NC, New York.....------------ --- --------------------- , E-2, E- 33, E E-5. 8555

Fort Richardson, Anchorage, Alaska_-... "...- ---- - -- ---- ;----- E-l, E-2, E-3, E-4, E-5.-.... . . 9,315

137

(ENCLOSURE 8]

ASSISTANT SECRETARY OF DEFENSE,

Washington, D.C., April 19, 1978.

Hon. MICHAEL H. MOSKOW,

Assistant Secretary for Policy, Development, and Research, Department of

Housing and Urban Development, Washington, D.C.

DEAR MR. MosKow : Reference is made to Federal Register Document 73-6642

which provided notice of the Department of Housing and Urban Development

(HUD) request for comments and information concerning review and evaluation

of HUD programs. Although the position of the Department of Defense (DOD)

has been provided to other organizations within HUD over the years and, more

recently, proposed legislation has been developed in concert with the HUD staff,

we are taking this opportunity to reiterate our requirements for continued and

expanded support by HUD through its housing programs.

The principal objective of the DOD family housing program is to assure that

married members of the Armed Forces of the United States have suitable housing

in which to shelter their families; military families number above 1,100,000. In

efforts to achieve this objective DOD policy is to rely on the local housing market

in communities near military installations as the primary source of family

housing for military personnel. Only where the local housing market is limited

or nonexistent or where housing is available but the location, quality or cost

creates an undue hazard or hardship for military families do we seek congres-

sional authorization and funding to construct family housing on the military

installation. In order to contribute to the orderly development of federally

impacted communities, the DOD endeavors to maintain a balance between on-base

and off-base housing resources; overall, some 31.8 percent of our military families

are adequately housed on base.

However, this balance is difficult to maintain at military installations in non-

metropolitan areas where HUD has determined the area to be an uninsurable

risk. In such cases, DOD is faced with upsetting the balance by heavily construct-

ing on base or, alternatively, relaxing our objective by continuing to permit

military families to remain in unsuitable community housing or to remain

separated. In order to attain an all volunteer force we must assure adequate

housing for our military families which currently leaves no alternative but

sizable housing construction programs on base. To maintain a proper balance

between on-base and off-base housing in such areas, and at the same time move

closer to our program objective, the community should be able to provide a major

portion of the housing required. Unfortunately, the community is too often pre-

cluded from meeting this housing need due to reluctance of HUD to insure in

these areas.

For this reason we worked very closely with the HUD staff during and sub-

sequent to late 1971 to develop legislation for the proposed "Revised National

Housing Act" which would permit HUD to insure private housing under the

"Special Risk Insurance Fund" in areas heretofore considered uninsurable risks.

The draft legislation is enclosed for your information, and is in the form of an

amendment to bill No. S-3248 as passed by the Senate on March 2, 1972. Enact-

ment of this proposal would greatly increase the supply of housing for DOD

military and civilian personnel at installations in nonmetropolitan areas, and

help to further assist in the orderly development of federally-impacted

communities.

We appreciate HUD's continuing cooperation in regard to our objective of

obtaining adequate family housing for members of the Armed Forces. Our

housing staff will be available for any further discussions on the matter covered

above.

Sincerely,

HUGH McCuLLOUGH,

Acting Assistant Secretary of Defense

(Installations and Logistics).

138

DOD PROPOSAL

In section 2(c), title I, of S. 3248, as passed by the Senate on March 2,

1972, delete the words "or single family housing for employees of research

and development installations where it is established to the satisfaction of

the Secretary that there is special need for such housing," and substitute the

following: "or housing for military personnel, Federal civilian employees or

Federal contractor employees assigned to duty or employed at or in connection

with (i) any installation of the Armed Forces of the United States or of the

Coast Guard or (ii) a research and development installation of the National

Aeronautical and Space Administration or the Atomic Energy Commission pro-

vided that, in federally-impacted areas where in the judgment of the Secre-

tary of HUD, the residual housing requirements for persons not associated

with these Federal Agencies are insufficient to sustain the housing market in

the event of substantial curtailment of employment of personnel assigned to

such installation, the Secretary of HUD may require a certification from the

Secretary of Defense, Secretary of Transportation, Administrator of NASA,

and Chairman of AEC, or their respective designees, that there is no intention

insofar as can be reasonably be foreseen to curtail substantially the personnel

assigned or to be assigned to such installation."

Delete in Section 201(b) (2), title II the words "or housing for employees

of research and development installations." Add a new Section 201(b) (6) as

follows: "(6) to the extent not covered under Sections 201(b) (1) through (5)

above, housing for military personnel, Federal civilian employees or Federal

contractor employees assigned to duty or employed at or in connection with

(i) any installation of the Armed Forces of the United States or of the Coast

Guard or (ii) a research or development installation of the National Aero-

nautical and Space Administration or of the Atomic Energy Commission."

Mr. SIKES. This committee, of course, was very pleased that a mili-

tary setaside was obtained in the 236 housing program because of the

advantages it offered those military families ineligible for on-base

housing. Now the program is frozen. Presumably there will be a fol-

low-on program, or a number of different programs, which can be used

in the same way.

In the meantime, the E-4's are now eligible for on-base housing.

The E-1's through E-3's are drawing more pay, and possibly some

of them have priced themselves out of the 236 housing program.

It has been suggested that legislation be proposed which would

take care of this situation and provide for military families ineligible

for on-base housing. One such proposal is the construction of 236

housing or follow-on housing at or near remote military bases, with the

determination of the need to include the military requirement, rather

than being based exclusively on the residual requirements in the local

communty. That was, of course, contained in the housing bill which

was reported last year, but which did not become law. Presumably,

it can be included again this year, when such a bill is reported.

That in itself does not meet the problem of personnel qualifying for

this housing. So, what legislation is the Department of Defense pro-

posing, or seeking, in connection with HUD low-income housing pro-

grams, to treat the problems of eligibility where they exist ?

Mr. FLIAKIS. We are seeking to maintain, to the extent that our

servicemen can qualify under the current guidelines as stipulated by

the Housing and Urban Development Act, some military setaside on

a limited basis. We still feel that we have a viable requirement for the

lower pay grades.

Mr. SIK ES. This committee supports that concept, but how do they

become eligible if they are now drawing pay that prices them out of

reach of the 236-type housing programs ?

Mr. FLIAKAS. Unless a very liberalized version or program is devel-

oped by HUD, which is unlikely, they cannot, sir, qualify to the degree

they have in the past.

Mr. SIKES. It has been suggested that the set-aside simply specify

military personnel in grades E-1 to E-3, regardless of income.

Mr. FLIAKAS. Yes. That would definitely require a change in the law.

Mr. SIKES. Yes, it would. What is your Department recommending?

Mr. FLIAKAS. We are recommending attention on the high-risk areas

as well as continuation of the 236 program for those people who can

qualify.

Mr. SIKEs. How many of the E-1's through E-3's can qualify ?

Mr. FIAKIS. In terms of specific numbers, I will have to furnish that

for the record.

Mr. SIK:Es. I would like it for the record.

Mr. FLIAKAS. Yes, sir.

[The information follows:]

Of the personnel projected for pay grades E-1 through E-3 worldwide, it is

estimated that approximately 142,000 will be married. Of this number approxi-

mately 100,000 are either suitably housed or voluntarily separated leaving a

deficit of 42,000 houses worldwide for the E-1 though E-3 category. A portion

of this deficit could be satisfied through continuation of the section 236 program

or similar programs. However, since qualification for section 236 housing varies

by the income limitations established for the location, the number of children in

the family, and by the total income for the military family including second jobs

or spouse's income, the actual number of military families in pay grades E-1

through E-3 eligible for section 236 housing is unknown.

Mr. SIKES. Are the E-3's, E-2's and E-l's all priced out of the 236

housing ?

Mr. FLIAKAS. No, sir. As you know, this varies by area because of the

great gross income limits established by the Public Housing Authority

in those specific areas. In every area in which we have a requirement,

all E-1's, 2's, and 3's can qualify. In most areas, E-4's and some E-5's

can qualify.

Mr. SIKES. There is not generally a problem in the lowest pay

grades

Mr. FLIAKAS. There are only two areas in which E-3's may have

been eliminated. One of them is in the Colorado Springs area, where

the Public Housing Authority has not seen fit to revise its income limits.

Another is in Montgomery, Ala. Those are the only two areas that I

know of, sir, where E-4's and E-3's, probably cannot qualify under

the regular income limitations.

Mr. SIKES. So, by and large, servicewide, those ineligible for on-base

family housing can continue to qualify in the 236 housing programs

when such housing is made available ?

Mr. FLIAKAS. That is correct, sir.

Mr. SIKES. That is reassuring.

Mr. FLIAKAS. Two years ago or 3 years ago, when we first initiated

this program, even some junior officers could qualify. These are the

people who have been wiped out, along with the higher grade NCO's.

EFFECT OF HUD PROGRAMS ON MILITARY FAMILIES

Mr. SIKES. What number of military families are benefiting from

IIUD-sponsored programs at the present time? Is this number going

up or down ?

Mr. FLIAKAS. The DOD is budgeting for 46,373 families under the

section 222 program. This program provides for the DOD payment of

premiums on mortgage insurance provided by the Federal Housing

Administration for mortgages assumed by active military personnel

for housing purchased by them. The number of personnel covered by

this program has shown a declining trend in recent years. As pre-

viously discussed, 6,937 units of section 236 housing were authorized

for military priority of occupancy prior to the freeze. The number

of military families benefiting from other HUD programs such as the

regular section 236 program, section 235 owned homes for low-income

families, or are residing in rental units which are under section 207,

or other miscellaneous HUD programs, is unknown.

STATUS OF LEGISLATIVE PROPOSALS FOR HUD SUPPORT

Mr. SIKES. Is there other legislation than that which we have dis-

cussed which should be considered, and which the Department of

Defense would support, to assist more enlisted personnel in the lower

grades to utilize HUD-sponsored housing ?

Mr. FLIAKAS. As we discussed earlier, sir, we believe that with the

assistance of your committee and the House Banking Committee, the

legislation we have proposed to HUD will benefit not only the lower

grades but the community itself and all personnel, including civilians

at that installation.

Mr. SIKES. Are you speaking specifically about the authorization

to construct this type housing, the 236 housing, in the vicinity of mili-

tary bases, regardless of the requirements in the community ?

Mr. FLIAKAS. No, sir. I have gone beyond that to these uninsurable

risk areas. These are the areas that really need attention.

Mr. SIKES. What do you mean by an uninsurable risk area? Are

we not talking about the same thing ?

Mr. FLIAKAS. I believe so, sir. This is where a residual civilian

market or requirement does not exist.

Mr. SIgEs. We are talking about the same thing. That is the lan-

guage that was in last year's housing bill.

Mr. FLIAKAS. Right.

Mr. SlKES. Is there any other language that you need at this time?

Mr. FLIAKAS. Not at this time.

I will be happy to furnish you, sir, with the latest version of that

bill that we are now discussing with HUD.

Mr. SIKES. Very well.

[The information appears on p. 250.1

Mr. SIKES. Do you expect such legislation to be cleared by OMB?

I believe last year we worked without the blessing of OMB in seeking

the amendment which was included in the housing bill. Can we antic-

ipate the blessing of OMB on this type of legislation this year?

Mr. FLIAKAS. Naturally, we will have to get the approval of OMB.

Based on HUD's exhibited interest at this time, I believe we will get

the concurrence of HUD and OMB.

The reason I say this is that it is generally agreed that the Depart-

ment of Defense should not get into the guarantee or insurance busi-

ness in the United States with respect to housing, and that HUD

should recognize its responsibility to supplement our efforts in those

areas.

OMB, we believe, will support this concept, but last year there was

some controversy surrounding it.

Mr. SIKEs. But you have no timetable'? Have you gone to OMB

seeking this approval?

Mr. FLIAKAS. Not formally, sir. We have formally sent to HUD

our proposals, and we have discussed it informally with both HUD

and OMB. We are hopeful that HUD will include our proposal in

their package that is submitted to the OMB and to the White House

in response to the request of the President for a housing study.

Mr. SIKES. Will you keep this committee advised?

Mr. FLIAKAS. I will.

Mr. SIKES. Will you try to build a fire under them ?

Mr. FLIAKAS. Yes, indeed.

Mr. SIKES. Have there been any problems with management avail-

ability, et cetera, that would complicate the use of the 236 housing by

military families ?

Mr. FLIAKAS. No, sir. To the contrary, I have spoken to many entre-

preneurs or sponsors who prefer military occupancy, actually.

IMPROVED FAMILY HOUSING SPACE ALLOWANCES

Mr. SIKEs. What are you recommending in the fiscal year 1974

program with regard to improved quality of family housing?

Mr. FLIAKAS. I believe you are speaking to our proposed increases

in space allowances-

Mr. SIKES. That is correct.

Mr. FLIAKAS. We are requesting increased standards for construc-

tion and the corollary proposed grouping of senior NCO's and com-

panv grade officers for house size.

I have as an attachment to my statement a comparison of the exist-

ing statutory limits and our proposals. We believe that these standards

will improve the overall quality of our family housing in a broad

sense and, of course, we supplement that with our current construc-

tion criteria which provide appropriate guidelines for quality of

design, construction materials, et cetera.

Mr. SIKES. For continuity in the record, I would like that to appear

at this point.

Mr. FLIAKAS. Yes, sir.

142

[The information follows:]

PROPOSED FISCAL YEAR 1974 SPACE CRITERIA FLOOR AREAS BY GRADE CURRENT VERSUS PROPOSED

Percent increase

Current statis- statistics limit

tics limit net OSD proposed net

General officers ..-..--.. . -- -............. ....... .. 2, 100 NC -.......

Senior grade..........- - - - 1, 670 1,700 2

Field grade:

3-BR ...... --------------------------------------------- 1, 400 NC ....-....-.-.-- .

4-BR..............-------- ........ ... ..... ...... ....----------------------------------- 1,400 1,550 11

Company grade:

2-BR-----------.................................... ---------------------------------- 950 950 (1)

3-BR----------------.....----------------------------- 1,250 1,350 8

4-BR--................ ------------. 1,400 , 450 4

5-BR ------------------------...- 1, 400 1, 550 11

Enlisted:

2-BR................--------------------------------....------------- 1950 950 (s

3-BR--...............-------------------------- 1,080 1,200 11

4-BR ----------------------....------- - 1,250 1,350 8

5-BR..................... 1,400 1,550 11

1 Administrative control.

2 To include senior NCO's.

a To be limited to E-6's and below.

NC-No change.

The changes requested will allow appropriate increases in the size of dining

rooms, secondary bedrooms, and the bathroom area to permit two full baths on

the second floor of two-story, three-bedroom units in lieu of one and one-half

now permitted, as well as permitting more appropriate circulation space required

to support the enlarged areas. The requested increases in net areas will, of course,

increase gross areas in proper proportion to provide needed additional interior

storage space. The total impact of the requested increases will be improved over-

all livability.

Mr. SIKES. How did you arrive at the particular space allowances

you are requesting, and what needed spaces will they provide ?

Mr. FLIAK.\S. The increases in space allowances being requested

were arrived at by an OSD/tri-service task group. The group analyzed

the existing space allowances and the indicated need for certain in-

creases reflected in the recently completed occupant survey conducted

by each military department. The changes requested will allow appro-

priate increases in the size of dining rooms, secondary bedrooms and

the bathroom area to permit two full baths on the second floor of two-

story, three-bedroom units in lieu of one and one-half now permitted,

as well as permitting more appropriate circulation space requi-d to

support the enlarged areas. The requested increases in net areas will,

of course, increase gross areas in proper proportion to provide addi-

tional interior storage space indicated to be a need by those families

surveyed. The total impact of the requested increases will be improved

overall livability.

Mr. SIKES. For the record, I would like a detailed listing of the

things that were brought out in the opinion poll you conducted among

service personnel and their wives, and what you did about them.

[The information follows:]

At this time we can only state general conclusions since final reports from all

services were received only within the last week or so. We know that a majority

of all personnel surveyed in each of the four services expressed general satisfac-

tion with on-base family housing and with the services received. There is an

indicated need for more space in dining rooms, secondary bedrooms, and for

storage. Occupants identified central air conditioning, a fenced yard, and half-

bath on the first floor of a two-story unit as the design features most important

to them from a list of 14. Wherry housing was consistently rated below average.

A comprehensive analysis of the mass of data gathered is proceeding and the

results, including any legislative recommendations which may be appropriate,

will be made known as soon as possible.

Mr. SIKES. Did your opinion poll show that some personnel prefer

to live off-base, no matter what type of on-base housing is provided ?

Mr. FLIAKAS. No. Military personnel were not asked to indicate their

preference for either on-base or off-base housing. The objective of the

survey was to cover preferences and obtain suggestions as to on-base

housing only.

FAMILY HOUSING AVERAGE COST LIMITATION

Mr. SIKES. Call you build the improved housing and also cope with

inflation within the new family housing dollar ceiling you are

requesting ?

Mr. FLIAKAS. I must be very candid and say I do not know. At the

time that we prepared these estimates and developed the new stand-

ards and costs related to those standards, we perhaps were too con-

servative in our estimate of cost growth. We had cranked into our

estimate a 6-percent factor for cost growth. This has already been

overcome, I am afraid.

If spiraling construction costs do not level off, then I can only say

that we would like to shoot for the new standards and have them as

an incentive, in the hope that rising costs do level off and we can get

some projects where perhaps competition is keen.

Also, they will be a tremendous incentive to the military departments

in terms of our improvement program when we upgrade our old

inventory.

I am saying that we hope to build as many units to those standards

as we can, and if we do not. get all the money we need this year, the

standard will be there, and we, will ask for it next year.

Mr. SIKES. In the main, however, I believe you are telling me that

inflation may have priced you out of many of the improvements that

you had contemplated, even if you do get the increased ceiling.

Mr. FLIAKAS. There are certain parts of the standards that we may

have to compromise. For example, the category I mentioned with

respect to the senior NCO's. We would still like an increase in the

standards for those categories of housing that I listed. If we cannot

build to them, there are certain things that would go first, and that

would be the first.

In other words, we would build NCO quarters to higher standards

but not senior NCO units to the company grade standard.

EFFECTS OF COST LIMITS ON PRIOR PROGRAMS

Mr. SIKES. What has been your experience with cost limits in prior-

year programs?

Mr. FLIAKAS. In fiscal year 1966, it was necessary to obtain a cost

exception for 200 uints at the Academy at West Point, and for 50 units

at Fort Leavenworth.

Also, in 1968 a cost exception was again obtained at Fort Leaven-

worth for 100 units.

SIn addition, you will recall that the size of the units at Leaven-

worth, even with the exception, had to be reduced. As I remember,

20-192 (Pt. 1) 0 - 73 -- 10

they were all field grade units, and we were not able to build to the

limits at that time. We had to reduce the scope.

Mr. SIKES. You are still using the old permanent facilities and

quarters at Leavenworth, the old brick buildings there ?

Mr. FLIAKAS. Yes, sir.

Mr. SIKES. Have they been rehabilitated, or are they the same as

they were 10 or 15 years ago ?

Mr. GERBER. The Army made a study to rehabilitate those units,

and the cost was so extensive that they did not take it under serious

consideration. They did two units as a pilot project to determine the

cost. It was beyond the possibility of getting approval, and they

dropped it.

Mr. RHODES. Have they not rehabilitated the kitchens in all the old

quarters there?

Mr. GERBER. I am not aware of it. I can check that out.

Mr. RHODES. I have been in them several times. It is my recollection

that the last one I was in had a modern kitchen.

Mr. GERBER. They may have been able to do it within their own

approval authority. I will check it out.

[The information follows:]

FISCAL YEAR 1972 IMPROVEMENT PROJECT, FORT LEAVENWORTH, KANS.

Fifty-six, three-bedroom field grade officer units contained in seven, eight-

plex, two-story brick structures which were originally constructed as barracks

in 1902 and converted into family housing in 1921. The scope of work includes

modernization of the interiors by (1) rearranging the kitchen layout and

providing new base and wall cabinets with countertops, new sink with garbage

disposer, utility connections for occupant 'ned clothes washer and dryer

and new floor covering; (2) rearranging ba.,tuom layout and providing ceramic

tile floor and wainscot, new plumbing fixtures and medicine cabinet; (3) modify

interior partitions to provide additional closet space; (4) modernize interior

electrical system by installing new fixtures and increasing the capacity from

60 to 150 amperes.

The current working estimate is $8,200 per unit at a total cost of $459,237

including design costs of $22,000. Contract award was made November 27, 1972,

the project was 38 percent complete as of April 30, 1973, and is scheduled for

completion by October 10, 1973.

Mr. SIKES. You did not mention Camp Drum. Do you intend to in-

clude Camp Drum, or is that one where you now have overcome the

problems?

Mr. FLIAKAS. We recently authorized the Army to proceed with

negotiations.

Mr SIRES. We know about that from another hearing.

A, re any others where you have had problems on costs?

Mr. I LIAKAS. We are aware that the Air Force was not able to award

its 1972 project at the Air Force Academy for some 200 units. The Air

Force is currently redesigning that project and will readvertise it and,

hopefully, will be able to come within the money. If not, then we may

have to include it as an amendment in the 1974 program as an

exception.

Mr. SIKES. Mr. Rhodes, I believe you have some questions.

Mr. RHODES. Do you expect to seek legislative relief for the cost

limitations in the fiscal year 1973 program ?

Mr. FLIAKAS. We have not yet had sufficient experience with the

1973 program to know whether any relief will be required.

Our usual method in order to live within the statutory limits is to

resort to deducts, or in some instances to take quality deficiencies with

respect to the project, in order to live within the money, but in no case

will we accept substandard housing.

Mr. RHODES. Will you be building substandard housing at places

such as Fort Jackson if you do not do that?

Mr. FLIAKAS. NO, sir. Under no conditions will we build, at Fort

Jackson or any other place, any substandard housing.

Mr. RHODES. Are you proposing that certain land acquisition and site

development costs be excluded from the unit cost limitations ?

Mr. FLIAKAS. NO, sir; not this year. As you know, we did propose

this last year, but the Congress did not act favorably on our proposal.

BREAKDOWN OF INCREASED UNIT COST

Mr. RHODES. Can you provide for the record an analysis of the in-

crease in unit cost limitation for the fiscal year 1974 program in terms

of higher costs for labor and materials, increased space, special costs

for site development and land acquisition, et cetera?

Mr. FLIAKAS. I will provide that, sir.

[The information follows:]

RATIONALE: FISCAL YEAR 1974 MILITARY FAMILY HOUSINO-CONUS

PROGRAM COST

Based on $24,000 average unit (Conus) being acceptable for fiscal year 1972:

1. Fiscal year 1973 base figure-$________-------- ---------------- $24, 000

2. Add 2.2 percent for restoration of deducts (deducts expected to be

needed to award fiscal year 1973 program) _____ __-------- _ _ 525

3. Add 6 percent to take care of cost growth from midcalendar year

1972 to midcalendar year 1973-___------------------------------ 1, 475

4. Add 1.5 percent for reduced number of 2-bedroom units due to 30-per-

cent limitation on such___ ____________________ ____-- _ 400

5. Add 4.2 percent for new space standards and 30 percent of EM units

being constructed for senior NCO's----------------------__------ 1,100

27. 500

Mr. RHODES. Mr. Long.

HOUSING EXCESS AS A RESULT OF BASE CLOSURES

Mr. LONG. You have moved out of many bases around the country,

or so it is claimed. At some of those bases there was housing that we

had built. I am thinking particularly of the Bainbridge Naval Sta-

tion, where just about the time you made the decision to move out,

you put about $2 million to fix up Wherry housing.

What are you doing with the facilities you are moving away from

at Bainbridge, and what are you doing with such facilities elsewhere

in the country ? How much of our housing, in other words, did we

build, hoping to solve the problem of need for housing, only to find

the base is surplus or redundant ?

Mr. FLIAKAS. I will answer the general question first, and then get

to Bainbridge.

There are about 13,000 units that are affected by the base closure im-

pact at our various installations. Only about 3,500 units or 26 percent

of these affected houses have been built with appropriated funds and

Only about 1,000 units since 1966. The balance, of some 10,000 units,

are either substandard quarters or built in the 1950's, such as Wherry,

and some Capehart housing built a little later.

We do expect to retain some of these through our cross-service

screening that is now going on among the services. For example,

McCoy Air Force Base will turn over some 668 units of adequate fam-

ily housing to the Navy for use at Orlando. There is another 900 units

at Albany that we hope to have the Marines occupy to some extent.

So, there will be some retention.

Mr. SIKES. Will the Marines use all of those houses at Turner?

Mr. FLIAKAS. Probably not, sir. I have not had a report as to just

how many they can use in total.

Mr. SIKES. I would doubt it.

Mr. FLIAKAS. I would doubt that all 900 would be required.

Mr. SIKES. What will you do with the rest ?

Mr. FLIAKAS. We would attempt, of course, to sever those that are

not required and, if no other Government use is developed for them,

we would turn them over to GSA for disposition. If they are encum-

bered housing, we try first to buy back the mortgages from the insti-

tutions that hold them so we can sell them free and clear.

GSA does require this.

As you know, we have had authorized some years ago the authority

to recover the proceeds from the sale of encumbered housing back to

the family housing account to apply against debt payment.

As I say, we have about 13,000 units that are affected. I cannot re-

port how many of these will be actually surplus and have to be

disposed of.

Mr. LONG. Can you provide that for the record ?

Mr. FLIAKAS. As we develop it, yes, sir.

Mr. LONG,. This is quite a touchy problem. It is awfully sad that

we are being asked to provide a lot of housing for the Armed Forces,

and in many cases it is needed; and then turn around and abandon

housing we already have because we were not farsighted enough to

build our bases at the right place, or because we are moving them for

other reasons.

I would like to know just how much the Department of Defense is

wasting in that sense. Also, I would like to know specifically what you

propose to do with that housing at Bainbridge and other places like

it. Are you going to 'be able to sell it ? I hope you are not going to

tell us that because housing is 15 years old it is not any good any more.

Mr. FLIAKAS. I will not tell you that, sir.

Mr. LoxNG. That, housing was fixed up only 8 or 10 years ago at

big expenditures of Government funds. I am getting a little tired of

hearing that housing which is 10 or 15 or 20 years old is no good. My

house is nearly 40 years old and worth several times what it cost to

build. Are you continuing to build houses that just wear out, and

are no good after 15 or 20 years ?

Mr. FLIAKAS. I think I should make the point, sir-I am certainly

not arguing your point with respect to the use of these houses, but

505 of the houses at Bainbridge are Wherry housing that were built

in the early 1950's, so they are 20 years old.

Mr. LoxN. Twenty years old? A house is just getting into use at

20 years.

Mr. FLIAKAS. Even in 1950, sir, an average of some $8,100 which is

what we paid for most of those houses, did not provide much house.

Mr. LONG. The Levitt housing in Philadelphia was built about that

time for $6,000 per unit. They are now selling for $40,000 a unit. You

cannot justify the idea that these houses cost only $9,000 and there-

fore are no good. Something is very wrong.

If you are not recognizing your mistakes of the past, you are going

to keep on making them.

Mr. FLIAKAS. I was merely pointing out, sir, the vintage of the

houses. I think our record is quite good that of the 13,000 units af-

fected, only 25 percent of the units have been constructed in the last

10 years.

To answer your question as to how we can predict where we should

build, we have attempted to apply very carefully and stringently,

guidelines to build only at hard core installations.

Mr. LONG. You have two problems here. One is that you built hous-

ing at a place that you subsequently abandoned. There are cases where

you should have known better, but let us say that you did not know

better. You went ahead and built them, and a few years later some-

thing happened and you had to move the base somewhere else. That

is one problem.

I would hope we could minimize that for the future.

DISPOSITION OF HOUSING AT BAINBRIDGE

The other problem is that houses built in 1952, in the case of the

Bainbridge Naval Station, and renovated only 8 or 9 years ago at a

cost of a couple of million dollars; you now imply that they are not

worth very much, that they are obsolete.

Mr. FLIAKAS. I did not mean to imply that. I am merely giving

you information.

Mr. SIKES. What did you rehabilitate at a cost of $2 million ? Is all

of the housing there Wherry housing?

Mr. FLIAKAS. No, sir. There are also 31 military construction houses,

that were built prior to 1950 with appropriated funds. There are also

63 inadequate trailers.

Mr. LONG. Most are these Wherry houses.

Mr. SIKES. Then you did rehabilitate the Wherry housing at a cost

of $2 million, roughly. Did you get a fully satisfactory house?

Mr. GERBER. The money spent in that $2 million rehabilitation

program, actually $2,283,570, primarily went into rehabilitation and

modernization of the kitchens, to get extra utility space to accom-

modate owner-occupied clothes washers and driers, as well as some

additional storage space-but, the bulk of the funds went into struc-

tural alterations to combine smaller units into ones with more bed-

rooms.

Mr. SIKES. How much was that per unit?

Mr. GERBER. It would be about $4,200 per residual unit-of the

original 744 units, 506 units remained after alterations.

ADEQUACY OF WHERRY HOUSING

Mr. SIKES. What is the basic problem with the Wherry housing?

There is general dissatisfaction expressed, servicewide, about the

durability, the livability of the Wherry housing. Why ? I do not think

we have ever brought this out for the record, and it should be.

Mr. GERBER. The Wherry housing program, you recall, sir, was built

in the early fifties. It was the first military housing construction after

World War II, at the same time the private housing industry was

getting into a housing boom. There was competition by private builders

to get these programs.

Most of them were rather large projects, 400 or 500 or 600 units. One

of them, for example, at Wright-Patterson Airfield, was 2,000 units.

We had a nationwide average maximum mortgage limit of $8,100

that could be put on these units, except in certain designated high

construction cost areas, where the mortgage could go up to $8,900.

In general, these units were minimal in size, many 1- and 2-bedroom

units, minimal in construction material, and minimal in design and

esthetics. Typical were densely sited 2-story walkup apartments with

virtually no sound attenuation, much heat loss, inadequate insulation

and minimum electric power. They were built to FHA minimum

property standards. We bought marginal quality in every sense of the

word.

Mr. LONG. I have already pointed out the Levitt case, in Phila-

delphia, where the housing units are supposed to be awfully poor

and shoddy cookie box houses. You know what they cost to build

and what they are worth now. That cost included the property, you

understand; approximately $6,500 with the land.

The same rules of economics applying to houses that Levitt built,

and sold, and made a profit, apply to the Department of Defense,

and your houses cost more than did the Levitt houses. This is not

based on a temporary condition of the market. If any blunder was

made, it was in the incompetence of the Defense Department in

producing the houses.

Mr. GERBER. I doubt that any of them cost that small amount of

money.

Mr. LONG. Why don't you look into it and see if I am right?

Mr. SIKES. What do you propose to do with the housing we are now

discussing?

Mr. FLIAKAS. After we have the screening process that is going on

now among the services those that can be retained, of course, will be.

There are, the examples I mentioned, and there may be others.

HOUSING AT BAINBRIDGE

Mr. SIKES. I am talking about this particular project in which Mr.

Long is interested.

Mr. FLIAKAS. Bainbridge ?

Mr. SIKES. Yes. Is there a projected use for these houses ?

Mr. FLIAKAS. I would doubt it, sir, in which case, since they are

encumbered, the Wherry houses do have a mortgage on them, we

would attempt first to buy back the mortgage, make a deal, and in

some cases we have been able to discount them, and then turn them

over to GSA.

Mr. LONG. What does that mean ?

Mr. FLIAKAS. We would turn them over to GSA for disposition.

They are required to sell them at the best price that they can get, but

again without causing a depression in the market. We work very

closely with the economic adjustment committee .and our own group

in the Pentagon and also with community leaders so we do not flood

the market with 500 units of housing.

Mr. LONG. I know something about the Bainbridge area, which is

just across the river from Harford County. That area is jumping.

I understand it is almost impossible to rent anything up there. It

costs a lot of money to build. I do not see how it is possible to flood

that area.

NEW CONSTRUCTION REQUESTED AT ABERDEEN

Here you are talking about building houses at the Aberdeen Proving

Ground. Why should you be building houses at the Aberdeen Proving

Ground when less than 10 miles a way you have 550 houses which are

going to be surplus?

Mr. FLIAKAS. If Aberdeen can use them-this is the screening proc-

ess that is going on now-then they will certainly be retained. If they

cannot, then we would dispose of them.

I might add-it is a very important point you touched on-in many

instances the availability of housing has been a very beneficial feature

in backfilling or attracting industry or other uses to that installa-

tion. We are not just giving up housing. We are giving up the installa-

tion and in some cases educational institutions, industry and other

users are attracted to them by the community.

Mr. LONG. You propose to build a certain amount of housing at

Aberdeen. Did you look into the question of surplus housing at Bain-

bridge?

Mr. FLIAKAS. Our 1974 Department of the Army project at Aberdeen

is for 166 units, of which 146 are 3-bedroom company grade, and 20

are 4-bedroom company grade. They are all, in other words, for junior

officers.

If this housing at Bainbridge can meet that requirement-

Mr. LONG. You have not answered my question, Mr. Fliakas. I have

had difficulty with you over the years getting you to answer questions.

Had you looked into the Bainbridge housing availability when you

made your request to us ?

Mr. FLIAKAS. The answer, sir, is "No."

Mr. LONG. Why hadn't you?

Mr. FLIAKAS. Because the decision to close Bainbridge was not

known at that time. I will say that we will not build there if the

assets at Bainbridge will meet the requirements.

Mr. LONG. You are speaking for the whole Defense Department ?

Mr. FLIAKAS. That is correct.

Mr. LONG. Did you not know that Bainbridge has been closing ever

since I have been in Congress?

Mr. FLIAKAS. I have certainly been aware of it, but the decision as

announced by the Secretary-

Mr. LONG. The definite decision did not come down until recently,

but you certainly knew about the possibility. Since it was known as a

possibility at least, why could you not have looked into it before you

came to us with this budget request ?

Mr. FLIAKAS. I can only say, Dr. Long, that the Army was not priv-

ileged to-

Mr. LONG. Just a minute. This has been in the papers. This has been

something that anybody could read about for years, and particularly

within the last couple of years. People have been hanging on tenter-

hooks for the longest time all over that area.

It was impossible for your people in the Department not to have

known of the possibility that Bainbridge would be closed down if

they could read and write.

Mr. FLIAKAS. Dr. Long, I cannot concede at the moment that the

assets at Bainbridge will meet the requirements. If they do, I will

emphatically state we will not build.

[The information follows:]

ABERDEEN PROVING GROUND (APG)

At the time the 166-unit family housing project for Aberdeen Proving Ground

was programed for the fiscal year 1974 military construction program, the po.

tential availability of housing at NTC Bainbridge, Md., was not considered.

Subsequent to the April 17, 1973 announcement of the scheduled closure of NTC

Bainbridge, Department of the Army evaluated the housing at Bainbridge and

determined that the Wherry housing was substandard and not capable of being

upgraded to standards of adequacy within reasonable costs, and without some

demolition to reduce the density.

Representatives of the Office of the Secretary of Defense have also visited

both Aberdeen and Bainbridge to evaluate the housing situation. An inspection

of the Wherry units at Bainbridge revealed that they are typical of marginal

Wherry units and should have been declared substandard. Not only are they

small in size but they lack the basic structural configuration and interior ameni-

ties that would permit them to be economically converted into adequate public

quarters. Accordingly, it has been determined that it is in the best interest of

the Government to dispose of the Wherry housing at NTC Bainbridge, Md.

Mr. LONG. That is not the point. The point right now is why didn't

you look into the possibility, examine the pros and cons, and be able

to tell this subcommittee there are so many houses of this type, so many

in good condition, there is this number that could be for enlisted

people, and this number could be for officers, instead of coming in

here as if nobody had ever heard of this, and trying to tell us that

the idea that Bainbridge was going to close is a brand new idea.

The chairman can support me on the Bainbridge business. You

are all sick and tired of hearing me on Bainbridge.

Mr. RHODES. I am just wondering if you have any requirement for

enlisted housing at Aberdeen. If the Wherry housing would not be

suitable for officers, it still might be suitable for certain enlisted grades.

Mr. SIKES. Including the E-4's, who heretofore have not been

eligible.

Mr. FLIAKAS. Can you talk to the requirement at Aberdeen, Mr.

Rollence ?

Mr. ROLLENCE. At Aberdeen, we are programing the 166 units. This.

is really a partial replacement project for a Wherry project which has

been declared substandard. This would take our total housing assets

at Aberdeen on post to about 45.6 percent, and overall it would take

our housing assets to 87 percent at Aberdeen. We would still have 4

residual housing requirement at Aberdeen over and beyond this project.

Mr. RHODES. It seems to me you are completely ignoring Dr. Long's

line of questioning. I think what Dr. Long has in mind is that the needs

of Aberdeen ought to be reconsidered in light of the probable avail-

ability of Wherry housing at Bainbridge.

Mr. SIREs. It would appear that has not been done.

Mr. RHODES. It looks as if he has a good point.

Mr. SIKES. It would appear there has been no such consideration,

and certainly this committee will want exact details on what the effect

of this housing will be on the housing requirements at Aberdeen. We

are not going to fund housing if it can be provided 10 miles away in

satisfactory condition.

WHERRY HOUSING AT FORT HOLABIRD

Mr. LONG. Following along that line, I just asked my assistant to

look up the information on Fort Holabird. We have units called the

Cummins Apartments on Fort Holabird reservation. They are Wherry

housing units. There are 147 rental units, of which 116 are rented to

military and 31 or 32 are rented to civilians. What do we do about

those?

Mr. FLIAKAS. That project has not been acquired by the Department

of Defense. It is still a privately owned housing project.

Mr. SIKEs. Can we have the result of an exact study on the Aber-

deen/Bainbridge housing situation? We want to know what part of

the housing can be used to accommodate the E-4's and those below

E-4. We would like to know what would be suitable for use by the

personnel for whom the units at Aberdeen were scheduled. I would

like to have an exact report on that as soon as possible.

Mr. LONG. They are leased, and all under private management. I

want to know what we lose on them in terms of mortgages and all that.

Mr. FLIAKAS. As I indicated before, the Department of Defense did

not acquire that Wherry housing project. It is still privately owned.

The land, as I recall it, is outleased-

Mr. LONG. It is a 99-year lease.

Mr. FLIAKAS. That is correct.

We will take disposition action on that land, in which case, then, he

would be free to acquire it. The units are not in our inventory.

Mr. SIKES. You do not plan to buy them, is that correct?

Mr. FLIAKAS. Absolutely not.

Mr. SIKEs. You would consider selling him the land ?

Mr. FLIAKAS. We will dispose of the land, yes, sir, that is correct.

Mr. LONG. If it is on a 99-year lease, there is nothing much to dis-

pose of, is there ?

Mr. FLIAKAS. We have no need, as far as I know, to retain the land.

Mr. LONG. Who would buy that land ?

Mr. FLIAKA. He would be free to bid

Mr. LONG. I am talking about the land on which the apartment units

are situated. Nobody would want it if the land is occupied by apart-

ment houses.

Mr. SIKES. If anybody else bid it in, it would still be subject to the

199-year lease.

M r. LONG. Exactly.

Mr. RHODES. It is a ground rent. It might be a pretty good invest-

Smnt, actually. I do not know what the ground rent is.

152

Mr. LONG. I note that you are requesting funds for 166 units of

family housing and 76 units for mobile home facilities at Aberdeen

Proving Ground. Are these funds being requested in order to provide

housing for personnel who are housed inadequately off-post, or are they

in order to provide housing in anticipation of increasing the military

strength at Aberdeen ?

Mr. FLIAKAS. The 166-unit new construction housing project and 76-

space mobile home park proposed for Aberdeen Proving Ground are

based upon projected strength and housing requirements after giving

full recognition to the magnitude of adequate housing existing and

planned for construction in the community. The 166-unit project is

meant to replace Wherry housing considered unsuitable for use by

junior officers with families requiring three and four bedrooms. It is

anticipated that the Wherry housing being replaced by this project

will be utilized by the approximately 283 families projected to be in

pay grades E-1 through E-3. The mobile home park is similarly based

upon the projected strength and estimated need for parking space by

both eligible and ineligible families owning their own mobile homes;

part of this project is meant to replace 45 spaces now on-base consid-

ered to be obsolete and undersized.

FORT HUACHUCA, ARIZ.

Mr. LONG. I would like to go back to Fort Huachuca, for a moment.

In the long run, how large an installation will Fort Huachuca be?

Since you are not requesting any more family housing or other housing

construction money this year, I presume the housing situation there

has improved. Please comment on this for the record.

[The information follows:]

The long-range permanent party military strength projected by Army is 5,778;

an additional military student load will average 941 people on short temporary

tours, and 3,322 civilians are projected for employment. The total population for

civilians and military (both permanent party and those on temporary duty)

is therefore projected at 10,771. Based on the calendar year 1973 housing survey

recently conducted, the Army reports that, overall, the housing picture is im-

proved over 1971 and 1972 reports, and that the housing referral inventory is

expected to double during 1973 in the apartment category. Data on construction

during the past 12 months follow :

New homes--414; additional mobile homes-609; and new apartments-12.

Additionally, 444 new homes and 200 apartments are scheduled for 1973 by

private developers. Tenneco West and 14 area contractors plan to build with the

market growth on about 1,500 acres of land now under development. A 60-unit

section 236 project is now under construction, and although not specifically

covered by military set-aside, will for the most part, benefit the lower pay grades

at Fort Huachuca. The situation has improved and is expected to continue to

improve.

HAWAII-PROJECT FRESH

Mr. RHODES. What are your plans with regard to the retention and

acquisition of land in Hawaii to meet your family housing requirements

there? Can you give us a detailed answer to this at this time?

Mr. FLIAKAS. I believe the committee is aware of the recently com-

uleted Project Fresh, facilities requirements evaluation, State of

Hawaii, report, in which all holdings of real property that were not

considered necessary for retention in support of family housing were

identified in that report for excessing.

There are no plans at this time, nor in the foreseeable future, for

any acquisition of land in Hawaii. We did cause the Project Fresh

report to be modified to retain potential housing sites.

For example, the site known as Puuloa was first considered as a

possible excessing of land, but we proposed that we retain that prop-

erty and now, as a matter of fact, the Navy plans to build 350 units of

housing in their combined 1972-1973 authorization at Puuloa.

Mr. RHODES. Where is Puuloa ?

Mr. FLIAKAS. It is adjacent to Barber's Point, near the Iroquois

Point housing project.

UTILIZATION OF FORT DERUSSEY

Mr. RHODES. Have you any plans to change the status of Fort De-

Russey or to dispose of that property or any part of it?

Mr. GERBER. As you know, there is presently under construction

an R. and R. hotel. The remainder of that land has been opened up to

the public as an open beach and park. It remains under Army control,

but available to the public.

Mr. SIKES. IS there any room left for military personnel? You have

a lot of public out there.

Mr. GERBER. Yes, sir.

Mr. SIKES. What is the answer ?

Mr. GERBER. We do not know yet, sir. Right now the property other

than the beach is full of construction equipment. It is planned that it

be made available and open to the public. How it will work out, I can-

not foresee.

Mr. RHODES. You mean all of the beach ? You are not saving that part

of the beach which is in front of the R. & R. hotel for military

personnel?

Mr. GERBER. That is right, all of the beach. This was imposed upon

the Department of the Army by the Federal Property Review Board.

[Off the record.]

COST OF HOUSING IN HAWAII

Mr. RHODES. What additional legislation are you proposing with

respect to site development costs in Hawaii ?

Mr. FLIAKAS. Hawaii is considered as an overseas location with

respect to the application of the cost limitations for military family

housing. We are recommending that the cost limitation be established

at $38,000, compared with the current limitation of $33,500. We con-

sider that this will be adequate for all housing that we see in the

near future, with perhaps the exception of Aliamanu Crater, where it

is possible to site some 2,400 units of housing. The Army is now pro-

posing special legislation to cover the extraordinary site development

costs in this.

Mr. SIKEs. Are you being priced out of Hawaii as far as practical

utilization of the islands for military purposes is concerned? Is that

what is happening?

Mr. FLIAKAS. Costs are exceedingly high, but we believe if we are

careful in our site planning, and we have tightened up the density,

particularly in metropolitan and urban areas, that we can within these

cost limits construct our military family housing.

When we open up difficult sites like the Aliamanu Crater, there may

be some extraordinary costs that will have to be exempted from the

average cost limitation.

I believe you are familiar with the previous bill which authorized

the exchange of Fort Ruger with the State of Hawaii for 'a site above

the Tripler Hospital. It is now contemplated that we will seek amend-

ment to that bill to apply the funds from that exchange to the Alia-

manu Crater development.

ALIAMANU CRATER HOUSING SITE

Mr. RHODES. Are you sure that the Aliamanu Crater is a suitable

spot for a major housing development, and that you will actually not

be building at such high density as to render the housing unattractive

and unsuitable ?

Mr. FLIAKAS. The site has been inspected by qualified representa-

tives from the DOD. Mr. Gerber and I were out there several weeks

ago, along with experts from the Corps of Engineers and from the

Naval Facilities Engineering Command. Extensive tests have been

started with respect to wind and temperature readings in the crater.

We believe that is it a suitable site.

It is planned tentatively to put some 800 units on the rim of the

crater, and another 1,600 units, perhaps, in the crater itself. It is a

very large tract of land, over 500 acres.

Also, we should point out that the Army has retained a very capable

architectural firm to develop the master plan and the environmental

impact statement on the crater. We think it will be a suitable site.

Mr. SIKEs. How many units do you propose to build in the crater!

Mr. FLIAKAS. We plan to master plan the crater for at least 2,400

units. In the 1974 bill, we are proposing 1,600 units, 1,000 for the Army

and 600 for the Navy.

Mr. SIKES. 2,400 units would be crowding a 500-acre tract quite

seriously, in my opinion.

Mr. GERBER. It is important to be aware that some 800 units (testi-

mony changed to "an appreciable number") can be put on the outside

face of the crater.

Mr. SIKES. Is that in addition to the 500 acres ?

Mr. GERBER. The 500-acre terminology is actually misleading. It is

more than that in total area.

Mr. SIKES. How much land is in the delta area ?

Mr. GERBER. It is probably something closer to 800 acres. [Testi-

mony later changed to 600 acres.] The 500 acres is just a vertical pro=

section, and some of the buildable land is on slopes varying from

8 to 20 percent.

[Additional information was provided as follows:]

(The flat delta area is about 300 acres.)

METHODS OF ACQUIRING FAMILY HOUSING OVERSEAS

Mr. RHODES. We have a report from the General Accounting Office

comparing methods of acquiring housing overseas. Do you generally

agree with the conclusions of this report ?

Mr. FLIAKAS. We generally agree. The GAO analysis covered three

methods of acquiring military housing overseas: lease-construction,

rental guarantee, and military construction with appropriated funds.

The GAO concluded that the lease-construct method is the least ex-

pensive where the need is of uncertain duration, and will not exceed

20 years.

We generally agree with that, with the further proviso that each

location should be examined on a case basis, and in some instances

perhaps a rental guarantee program will have certain advantages.

Either of those two methods we think are viable methods of acquiring

housing overseas.

OVERSEAS LEASING

Mr. RHODEs. By what amount are you expanding the overseas leas-

ing program?

Mr. FLIAKAS. For this year's program before you, we are budgeting

for 7,262 foreign leases at a cost of $19.9 million. This compares with

our current allocation of 4,977 leases at a cost of $16 million. We

have roughly an increase of 2,300 units. Most of these leases will be

in Germany.

Mr. SIKEs. Do you believe that leasing is the best way to provide

overseas housing?

Mr. FLIAKAS. We believe it has very definite advantages. Hereto-

fore, we have been leasing primarily for special command positions

and hardship cases. We now feel that we can expand our leasing

program to include general troop use, primarily for the lower grades.

Two years ago, we authorized the Air Force to enter into an agree-

ment at Torrejon in Spain for 300 units. We also recently received

an approval from the Senate Armed Services Committee, who had

an administrative ceiling placed on this program, to allocate an addi-

tional 500 units in Germany and in Italy, again totally for general

troop use.

RENTAL GUARANTEE PROGRAM

Mr. SIKES. What rental guarantee housing projects are being

proposed ?

Mr. FLIAKAS. Department of the Army is currently reviewing a

proposal for the construction of 1,825 rental guarantee units in Ger-

many. The military departments have rental guarantee projects under

consideration at the following locations: Sigonella, Italy, 250 units;

Misawa, Japan, 250 units; Ramstein, Germany, 300 units; Soester-

berg, Netherlands, 200 units.

Mr. SIKES. What increases in cost limits are you requesting for the

leasing program and for the rental guarantee housing program in

fiscal year 1974?

Mr. FLIAKAS. We are not asking for any increase in the cost limita-

tions on the domestic leasing program. For the rental guarantee

program we are requesting that the current average guaranteed rental

ceiling on any project be raised from $225 per month to $275 per unit

per month.

INCREASED FAMILY HOUSING OPERATION AND MAINTENANCE COSTS

Mr. RHODES. What increases in family housing maintenance and

operation costs have you experienced ,in the past year in the United

States and overseas? Is there a sufficient allowance in the fiscal year

1974 budget to meet these costs?

Mr. FLIAKAS. In 1972, our total maintenance and operation costs

for Government housing increased some 13 percent over 1971. We

believe that the 1974 budget includes sufficient funds to meet our

programed requirements known at the time of preparation.

On the other hand, we have already pointed out this morning that

the devaluation of the dollar will increase our maintenance costs over-

seas by some $18.5 million. So, a goodly part of the funds that we had

hoped to apply against the backlog of deferred maintenance will be

required by this increase.

Mr. NICHOLAS. Is there any possibility that you will ask for a supple-

mental appropriation for 1974 ?

Mr. FLIAKAS. I would say not. I do not know of any proposal at this

time.

FAMILY HlOUSING NOT AWARDED DUE TO BASE CLOSURES

Mr. RHODES. What is the situation with regard to family housing

projects which have not been awarded and will not be required as a

result of base closures and realinements?

Mr. FLIAKAS. There are 5 projects in the 1973 program which are no

longer required. I can list those for the record.

Mr. SIKES. List them for the record, if you will. They will not be

built; is that right?

Mr. FLIAKAS. They will not be built.

Mr. SIKES. Are any under contract ?

Mr. FLIAKAS. No, sir; they are not.

[The information follows:]

There are five projects in the 1973 program, which are no longer required

because of the base closures and realinements. They are as follows:

Army-Fort Monmouth, N.J., 100 units.

Navy-NC Long Beach, Calif., 400 units. NAS Lakehurst, N.J., 200 units. NC

Newport, R.I., 150 units.

Air Force-Laredo AFB, Tex., 200 units.

In addition, the fiscal year 1972 project at NC, Long Beach, Calif., for 300

units will not be built.

IMPROVEMENTS PROGRAM NEED FOR MORE FUNDS

Mr. RHODES. In the event that the limitations on the amounts author-

ized for the improvements program were increased, could you effec-

tively use some of those savings in that program?

Mr. FLIAKAS. Yes, indeed; we could.

Mr. RHODES. You mentioned the fact that, in the past 2 years, this

committee has increased the amount provided for minor construction

above the budget request. Could you effectively use more than you are

requesting in this area in fiscal year 1974?

Mr. FLIAKAS. If additional generated resources are applied to the ,

1974 program, we probably could make the most effective use of them

in the improvement and alterations program. The minor construction

authority is somewhat limited because of its criteria for urgency.

On the other hand, we have made effective use of the sums, some

$28 million in the last 2 years, that this committee has provided.

I would say, yes, we would use the funds, but we would prefer

them, probably, in another category-in the improvement program.

Mr. SIKES. Thank you very much, Mr. Rhodes.

STATUS OF PRIOR YEAR'S PROGRAMS

Which of the fiscal 1973 family housing projects have been and

which have not been placed under contract?

Mr. FLIAKAS. We have had very limited experience with respect to

the 1973 program. I will refine this for the record, but it is generally

my belief that there are no 1973 projects as yet awarded.

Mr. SIKES. Why is that?

Mr. FLIAKAS. Because the military departments are still working

against their 1972 program. About 75 percent as of the middle of

last month were awarded. That figure may have improved now.

Mr. SIKES. You are speaking of the 1972 program ?

Mr. FLIAKAS. Yes, sir.

Mr. SIKEs. This could indicate-I hope it does not, but I want

clarification-that we are providing housing faster than you can

digest it, even though it is your recommendation that we provide it.

What is the situation ? Are you unable to process and award the con-

tracts after Congress approves the ones you request ?

Mr. FLIAKAS. No, sir. The Army and the Navy have pretty much

completed their 1972 program and have now turned their attention

to their 1973 program. Normally, we would begin-

Mr. LONG. You are 1 year behind.

Mr. FLIAKAS. Sir, we received the appropriation, I believe, in No-

vember of last year. Normally, we would begin to award the 1973

program in the early spring. March, April, May, is now the time we

should begin to award the 1973 program.

The Air Force was delayed in the implementation of the 1972 pro-

gram because of their industrial buy concept, in which they pro-

posed that they aggregate the market at certain installations and

advertise regionally in the hopes of attracting industrialized builders.

That program did not succeed, and they are now in the process of

awarding most of their 1972 program on a turnkey basis. They had

to start up again, so to speak.

They have generated now sufficient speed to catch up within the

next few months. They were set back because of this program. I do

not believe we are too far behind.

Mr. SIKES. When do you anticipate that the 1973 program. or those

parts of it with which you are going to proceed, will be under

contract ?

Mr. FLIAKAS. I would say the bulk should be awarded late summer

and early fall of this year.

Mr. SIKES. So there are no problems which are more difficult than

usual at this time, is that correct ?

Mr. FLIAKAs. That is correct.

Mr. SIKES. Some housing, I presume, is in bases that are being closed

and, of course, would not be awarded. How much housing of that type

is there that was authorized and funded but is at bases which are to

be'closed ?

Mr. FLIAKAS. I believe there are five projects, for a total of about

$26 million. I will furnish the list to you.

There are 100 units at Fort Monmouth, N.J., for the Army. That is

the only Army project.

The Navy has 3 projects: 400 units at Long Beach, Calif.; 200 units

at Lakehurst, N.J.; and 150 units at Newport, R.I.

The Air Force has one project affected: 200 units at Laredo, Tex.

A total of $26 million.

DISCUSSIONS WITH FIHA AND LOCAL OFFICIALS

Mr. SIKES. Have you discussed housing availability and housing

needs with the FHA in the respective communities?

Mr. FLIAKAS. In those communities, sir ?

Mr. SIKES. In communities where you propose to build housing.

Mr. FLIAKAS. Yes, indeed. As you know, sir, we are required to have

FHA certification of need. We have received certification of our en-

tire 1973 program. They are now reviewing our 1974 program. Usu-

ally they finish their certification by June or July.

Mr. SIKES. This committee also has felt that it is very important

that your base commanders discuss with community leaders the hous-

ing situation in order to take into consideration the availability of

houses readily available at reasonable rates in the community. Are you

doing that ?

Mr. GERBER. Yes, sir. Recently the OMB issued a circular, A-95,

in which it reminds all Federal agencies, including the military de-

partments, to apprise the local communities, and particularly the

regional clearinghouses, of their plans and programs.

We have sent that word out to the field and have sent out two re-

minders to make sure it is implemented.

Mr. SINES. Very good. Gentlemen, thank you very much. We have

had a very useful hearing.

Mr. FLIAKAS. Thank you, Mr. Chairman.

[The subcommittee adjourned at 4 p.m.]

MONDAY, MAY 7, 1973.

DEPARTMENT OF THE ARMY

PRINCIPAL WITNESSES

G. W. BRAZIER, JR., DEPUTY FOR INSTALLATIONS AND HOUSING,

OFFICE, ASSISTANT SECRETARY (I. & L.) OF THE ARMY

MAJ. GEN.-K. B. COOPER, DIRECTOR OF INSTALLATIONS, OFFICE,

DEPUTY CHIEF OF STAFF FOR LOGISTICS

MAJ. GEN. J. A. KJELLSTROM, DIRECTOR OF ARMY BUDGET, OFFICE,

COMPTROLLER OF THE ARMY

SUPPORTING WITNESSES

LT. GEN. W. P. LEBER, SAFEGUARD SYSTEM MANAGER, OFFICE,

CHIEF OF STAFF

BRIG. GEN. H. LOBDELL, JR., U.S. AIR FORCE, DIRECTOR, EUROPEAN

REGION, ISA

BRIG. GEN. C. C. PIXLEY, DIRECTOR, HEALTH CARE OPERATIONS,

OFFICE, THE SURGEON GENERAL

COL. D. L. BURT, TROOP SUPPORT DIVISION, OFFICE, DEPUTY CHIEF

OF STAFF FOR LOGISTICS

COL. W. P. GARDINER, ENVIRONMENTAL OFFICE, OFFICE, DEPUTY

CHIEF OF STAFF FOR LOGISTICS

COL. R. F. HAAS, LOGISTICS AND FACILITIES DIVISION, OFFICE, THE

SURGEON GENERAL

COL. H. W. LOMBARD, NEW YORK DISTRICT ENGINEER, OFFICE,

CHIEF OF ENGINEERS

COL. P. J. RAISIG, OFFICE, PROGRAM MANAGER FOR REORGANI-

ZATION, OFFICE, CHIEF OF STAFF, U.S. ARMY

COL. J. A. RICHBOURG, CONSTRUCTION DIVISION, OFFICE, DEPUTY

CHIEF OF STAFF FOR LOGISTICS

LT. COL. J. I. COATS, AVIATION OPERATIONS DIVISION, ARMY AVIA-

TION DIRECTORATE, OFFICE, ASSISTANT CHIEF OF STAFF FOR

FORCE DEVELOPMENT

LT. COL. C. J. ORAM, AVIATION OFFICE, DIRECTOR FOR SUPPLY AND

MAINTENANCE, OFFICE, DEPUTY CHIEF OF STAFF FOR LOGISTICS

LT. COL. C. E. SELL, PROGRAMS AND BUDGET DIVISION, OFFICE,

CHIEF OF RESEARCH AND DEVELOPMENT

LT. COL. R. L. WILLIAMSON, CONSTRUCTION DIVISION, OFFICE,

DEPUTY CHIEF OF STAFF FOR LOGISTICS

A. M. CARTON, PROGRAM, PLANNING, AND CIVIL PREPAREDNESS

DIVISION, DIRECTORATE OF MILITARY CONSTRUCTION, OFFICE,

CHIEF OF ENGINEERS

R. J. FITZ, CONSTRUCTION DIVISION, OFFICE, DEPUTY CHIEF OF

STAFF FOR LOGISTICS

(159)

20-192 (Pt. 1) 0 - 73 -- 11

160

P. W. JOHNSON, OFFICE, DEPUTY FOR INSTALLATIONS AND HOUS-

ING, OFFICE, ASSISTANT SECRETARY (I. & L.) OF THE ARMY

H. G. KIRCHNER, OFFICE, DIRECTOR OF ARMY BUDGET, OFFICE,

COMPTROLLER OF THE ARMY

T. L. GRAY, PROGRAM, PLANNING, AND CIVIL PREPAREDNESS DI-

VISION, DIRECTORATE OF MILITARY CONSTRUCTION, OFFICE,

CHIEF OF ENGINEERS

W. M. LOCKWOOD INSTALLATION MANAGEMENT DIVISION, OFFICE,

DEPUTY CHIEF OF STAFF FOR LOGISTICS

J. T. LOVELAND. U.S. MISSION, NATO

DEPARTMENT OF DEFENSE MILITARY CONSTRUCTION, ARMY

PROGRAM AND FINANCING (IN THOUSANDS OF DOLLARS)

Budget plan (amounts for construction

actions programed)

1972 1973 1974

actual estimate estimate

Program by activities:

Direct:

1. Major construction..... ..

2. Minor construction........

3. Planning............

4. Supporting activities .....

5. NATO infrastructure... -

Total direct............

Reimbursable (total).............

Obligations

1972 1973 1974

actual estimate estimate

423,526 496,129 595,400 409,813 553,579 637,584

10,000 12,500 12,500 10,081 13,500 13,000

32,300 34,200 39,000 36,960 38,445 45,406

2,860 4,476 2,010

24,860 62,000 60,000 44,085 72,000 60,000

490, 686 604, 829 706, 900 503, 799 682, 000 758,000

282,766 222,000 268,000 356,879 286,000 264,000

Total..--..........---....... 773,452

826,829 974,900

860,678 968,000 1,022,000

Financing:

Receipts and reimbursements from

Federal funds ... .

Trust funds ........ . ..

Non-Federal sources---- . ---

Unobligated balance available,

start of year:

For completion of prior year

budget plans..... ..

Available to finance new

budget plans............

Reprograming from (-) or to

prior year budget plans ..-...

Unobligated balance available,

end of year:

For completion of prior year

budget plans ... ....

Available to finance subse-

quent year budget plans..

Budget authority (appro-

priation) ...

-239,327 -172,400 -217,000 -247,730 -172,400 -217,000

-54, 299 -49, 600 -51,000 -54,299 -49,600 -51,000

.--- - -24,000 -20,000 -5,726 -24,000 -20,000

-- ---------- -929,048 -750,815 -605,444

-548 -162,674 ........... --548 -162,674 .......-----

-105,136 -4,200 -22,000 ..---------------------

. . . . . . . . . . . . . . . -750,815 605,444 536,344

162,674 ...............-------------------...---. 162,674 ...--..---------------

536,816

413,955 664,900 536,816 413,955 664,900

PROGRAM AND FINANCING (IN THOUSANDS OF DOLLARS)

1972 1973 1974

actual estimate estimate

Relation of obligations to outlays:

Obligations incurred, net ......---.. ..... ------------------------- 552,923 722,000 734,000

Obligated balance, start of year ............ 282,774 445,433 762,433

Obligated balance, end of year ..... .. ....... ..... ...... ..... - 445,433 - 762,433 -1,061,433

Outlays. -...... ..-.... . . . . . . .- ------ -- --- -- 390, 263 405,000 435,000

161

OBJECT CLASSIFICATION (IN THOUSANDS OF DOLLARS)

1972 1973 1974

actual estimate estimate

DEPARTMENT OF THE ARMY

Personnel compensation:

Permanent positions ................. ...........

Positions other than permanent...

Other personnel compensation ................... ..

Total personnel compensation.........................------------

Direct obligations:

Personnel compensation... ..........................

Personnel benefits, civilian... ............ .......... ....

Travel and transportation of persons............ ........ . .

Transportation of things..............---------------------------..

Rent, communications, and utilities..........................

Printing and reproduction....................... ...... ...

Other services ......... ........... .............

Supplies and materials ...................

Equipment................................

Lands and structures ..---...........--------------------

Insurance claims and indemnities ---------.........................---------

Interest and dividends .............. .... ..... ......... .....

Total direct obligations...................... .. . ..... ...

Reimbursable obligations:

Personnel compensation---------.........--....................

Personnel benefits, civilian..............--------------.........

Travel and transportation of persons ....-.....................

Other services .................... ....

Lands and structures.................... ...............

Total reimbursable obligations-.............................

Total, Department of the Army ...........-...... ...........

55,900 64, 121 64, 629

1,200 1,887 1,996

1, 148 792 792

58,248 66,800 67,417

19,416 20,751 20,097

1,728 1,854 2,174

2,360 2,500 2,600

653 660 675

4,380 4,500 4,600

1,200 1, 250 1, 250

86,500 95,000 95,000

7,300 7,800 8,000

15,675 15,700 15,800

355,960 517,421 605,744

20 20 20

30 30 30

495,222 667,486 755,990

38, 832 46,049 47,320

3,937 4,055 3,829

116 115 115

44,200 44,000 37,000

269,794 191,781 175,736

356,879 286,000 264,000

852,101 953,486 1,019,990

ALLOCATION ACCOUNTS

Personnel compensation:

Permanent positions.................................

Positions other than permanent..........................

Other personnel compensation-....................

Total personnel compensation...............................

Personnel benefits, civilian employees................... ....

Travel and transportation of persons ....

Transportation of things ................................

Rent, communications, and utilities.......... .............

Other services .............................

Supplies and materials.........................................

Lands and structures.........................................

Total allocation accounts................. ...........

Total obligations ..................... .............

Obligations are distributed as follows:

Defense-M ilitary:

Army...............

Department of Transportation...............-.........

98 146 26

13 13 3

30 60 8

9 18 2

3 6 1

110 220 26

1 2 1

8,313 14, 049 1,943

8,577 14,514 2,010

860,678 968, 000 1, 022,000

852,101 953, 486 1, 019,990

8,577 14,514 2,010

Personnel Summary

DEPARTMENT OF THE ARMY

Total number of permanent positions ............. .......

Full-time equivalent of other positions.........................

Average paid employment.................. .........

Average GS grade...............................................

Average GS salary..........................................

Average salary of ungraded positions................................

ALLOCATION ACCOUNTS

Total number of permanent positions................... ......

Average paid employment..........................................

Average pS grade ................. .................. ..... - __ - ._ _ -

Average GS salary............-...... ..................

4, 068 4,526 4, 485

996 478 485

4, 379 5, 029 4,994

9.2 9.2 9.2

$13, 891 $14, 075 $14, 259

$5, 757 $5, 843 $5, 929

10 10

11 15

8.0 8.0

$9,248 $9,384

3

3

8.0

$9, 520

162

OPENING STATEMENT OF THE CHAIRMAN

Mr. SIKES. We are very pleased to welcome here this morning Mr.

Brazier and General Cooper from the Department of the Army.

I am happy to note that we have three able new members of the

subcommittee: Mr. Obey, Mr. Davis, and Mr. McEwen. I am con-

fident they will carry out the fine traditions established by those who

preceded them on this subcommittee.

Mr. Brazier and General Cooper appear in their new capacities as

Deputy for Installations and Housing and Director of Installations

for the Army.

ARMY HOUSING PROGRAM

The committee notes that the Army's request this year contains sub-

stantial increases over previous years for both bachelor and family

housing. Please include in the record, at this point, a table showing

the amounts provided for bachelor and family housing construction

and modernization in the past 4 years and that proposed for fiscal

year 1974. Also, please show the number of units constructed or mod-

ernized in each year.

[The information follows:]

ARMY HOUSING PROGRAM FISCAL YEARS 1970-74, BACHELOR HOUSING

Construction Modernization

Spaces (Thousands) Spaces (Thousands)

Fiscal year:

1970...-------...--------------------- 7,650 $35,753 0 0

1971 ___. 5,541 25,629 0 0

1972 - ..._.... ........ . ... ... 6,752 58, 101 53,990 $55, 513

1973 ...-...... . .... .-....... ... . 16,001 127,786 49,039 110,658

1974- -... --...--.. . . .............. -. 24, 838 242, 577 47,424 146, 311

'Full modernization did not start until fiscal year 1972.

2 Spaces based on contract awards as of Apr. 5, 1973.

3 Only 10,789 spaces at full modernization. Remainder were for "Quick Fix."

FAMILY HOUSING

New units Appropriation

authorized (thousands)

Fiscal year:

1970----------------------------------......-------..............1,200 $25,060.0

1971.....---------.................................------------------------------------------------. 1,700 41,032.0

1972----...........----------------..............................................------------------------------------. 2,008 51,854.9

1973.........--------.................................. ----------------------------------------------- 4,166 106, 102.0

1974 .. ............ .. ......... ................. ...... 6,135 178,208.0

' Includes 201 units deleted from program (200 at Malmstrom Safeguard Site and 1 at Sharpe Army Depot, Calif.).

= Includes 215 units at Malmstrom Safeguard Site deleted from program and 125 units at Grand Forks Safeguard Site

currently deferred

a Includes 218 units at Grand Forks Safeguard Site deferred in the program.

We are glad to see the Army following a realistic program in this

important area. I believe the committee will support the request where

it feels there is a likelihood of long-term use of these facilities.

In your discussion, we would like your recommendations for any

changes that appear required or important in the legislation affect-

ing these programs. I am thinking particularly of section 236 housing,

where there may be a requirement for some change in the eligibility

requirements.

The committee has felt the Army was not keeping pace with the

other services in some of its construction programs in prior years.

Those things we will discuss with you. We do feel that the present pro-

gram is a more realistic one. This we think will help to correct the

problem. There are some particular installations, which we will discuss

with you, where we have been disappointed at the way individual proj-

ects have been handled, as, for instance, Fort Drum, in New York,

where there has been a serious need for new housing. Because of costs

and other problems, nothing has been accomplished. We feel we must

correct that situation. The committee is ready to work with you to do

SO.

Again, we welcome both of you before the committee, and wish you

well in your work. We want to be helpful. We know the essentiality

of an adequate construction program. We are happy that you are

stressing housing.

We will ask that your biographical sketches be included in the rec-

ord ahead of your statements.

BIOGRAPHICAL SKETCH OF GEORGE W. BRAZIER, JR.

[The biographical sketch follows:]

GEOBGE W.LLIAM BRAZIER, JR.

Mr. Brazier became Deputy for Installations and Housing in the Office of the

Assistant Secretary of the Army-Installations and Logistics--on October 9,

1972. He is responsible for installation planning and programing; construction;

real property and real property maintenance; military and civil works real

estate; and direction and control of family housing functions.

He was born on June 23. 1923, in Johnson County, Kans., and spent his early

years in Kansas City, Kans. His engineering education at the University of

Kansas was interrupted for active duty in the Army during World War II.

In Europe he participated in three major campaigns and received a battlefield

commission as a combat infantryman.

Following the war he resumed his education graduating in 1949 from the

University of Kansas with a degree in architectural engineering. In 1950, as

an officer in the Army Reserve, he was recalled to active duty for the Korean

conflict where he served during five campaigns as an engineer officer.

In 1955 he went to Morocco as a civilian representative of the Army Corps of

Engineers. As chief of construction for the Morocco district he was involved

in the construction of a complex of air bases for the U.S. Air Force.

In 1959 he returned to the United States for employment in the Office of the

Army's Chief of Engineers. From then until he assumed his present duties he

served in a succession of military construction and civil works assignments.

Mr. Brazier was decorated for valor in both World War II and the Korean

conflict and has received the Army's award for Meritorious Civilian Service.

He is a member of the American Society of Civil Engineers, the American Society

of Professional Engineers, the Virginia Society of Professional Engineers, the

U.S. Committee on Large Dams, the Permanent International Association of

Navigation Congresses and the Society of American Military Engineers. He is

registered both as an architect and as a professional engineer.

Mr. Brazier is married to the former Roberta Jacobus of Wichita, Kans.

They have six children and reside in Fairfax County, Va.

Mr. SIKES. We shall be pleased to hear your statement, Mr. Brazier.

STATEMENT OF DEPUTY ASSISTANT SECRETARY OF THE ARMY,

INSTALLATIONS AND HOUSING

Mr. BRAZIER. Thank you, Mr. Chairman.

Mr. Chairman, members of the committee, I appreciate having this

opportunity to appear before you to discuss the Army's military con-

struction request for fiscal year 1974.

In total obligational authority our request is $706,900,000. It does

not include any funds for either Safeguard or Site Defense of Minute-

man. It does include $60 million for the NATO infrastructure program

and $51,500,000 for general authorization. The remainder, $595,400,000,

is for major construction. To keep this figure in perspective, I would

like to talk for a few moments about the Army's backlog of deferred

construction.

CONSTRUCTION BACKLOG

This backlog, which excludes any requirements for Reserves, family

housing or overseas areas, is currently estimated at $6.5 billion. This

is $1.6 billion less than the figure we reported last year. This reduction

reflects a decrease in the total strength of the Army but more signifi-

cantly it reflects a purging of the backlog to remove low priority items.

$4.1 billion, or almost two-thirds of the backlog, is for modernization

and replacement of existing facilities which have become outmoded.

We calculate that to satisfy just the modernization and replacement

portion of the backlog including annual depreciation within a 10-year

period would require an annual funding level of $600-700 million. Be-

cause of overall fiscal restraints, we are unable to program at this level.

This year's request includes only $463 million for replacement and

modernization. Thus, it is apparent that only the highest priority items

have been included in our request.

This year we have had to handle a special requirement; namely, con-

struction items required in connection with the recently announced

reorganization of the Army. Our construction request incorporates 14

projects totaling $11,182,000 for this purpose. However, again this

year the major thrust of our request continues to be for people-oriented

facilities. Almost 85 percent of our major construction request is for

troop housing, community support, and medical/dental facilities.

TROOP HOUSING

Troop housing accounts for almost 70 percent of the major construc-

tion request. Committed as we are to the objective of providing ade-

quate housing for all our personnel in the seventies, we are continuing

our two pronged attack on the barracks problem by programing for

the modernization of existing permanent spaces as well as for new

barracks. I am pleased to report that our bidding experience with the

new regional barracks designs has been generally encouraging. As

might be expected, we have had problems with a few projects, but over-

all the program has been a successful one. We are enthusiastically pur-

suing the approach of housing no more than three men to a room, ex-

cluding trainees, and are thoroughly convinced it will prove of major

benefit to the Army in attracting and retaining personnel who measure

up to the high standards required by today's Army. Significantly, our

troop housing request includes modernization and new construction

for more than 7,500 women. This is consistent with the planned expan-

sion of the Women's Army Corps from a fiscal year 1972 end strength

of 12,400 to a fiscal year 1978 end strength of 23,800. Our request in-

cludes not only housing, academic and administrative facilities at Fort

McClellan, the WAC center, but also troop housing at a number of

other installations throughout Conus.

COMMUNITY SUPPORT

In the category of community support facilities, this year's request

is for $48.2 million, an amount which .approximates that approved in

last year's request. Prior to last year, we were unable to allocate sig-

nificant amounts to these facilities. However, we feel they can no

longer be deferred if we are to foster the spirit of community cohesive-

ness so important to an organization such as the Army whose efficiency

is intimately associated with group effort. I would like to note that

the community support category includes $12.1 million for five de-

pendents' schools in Europe. Existing conditions are deplorable and

accreditation is in jeopardy. We feel we have an obligation to our

personnel stationed in this part of the world to provide the facilities

required for the education of their children.

MEDICAL

In the medical/dental category, we are requesting $45.8 million.

Although this amount is only about $10 million more than our request

last year, with the fiscal year 1974 program we are embarking on a 5-

year, greatly expanded DOD health facilities modernization pro-

gram. Because of the long leadtime for design of these facilities, the

upsurge in construction funds for the expanded program will not be

required until beginning with the fiscal year 1975 program. However,

design funds are required at this time. As you are aware, we have

reprogramed $4.2 million fiscal year 1973 funds to begin design of this

accelerated program and the general authorization portion of this

year's request includes $6 million for this purpose.

COSTS

So much for an overview of the composition of this year's request.

Now I would like to talk 'a few moments about our construction man-

agement performance. With regard to cost estimating, we are main-

taining .a high degree of reliability. Considering the rapidly spiraling

prices of the last few years, the fact that we have been able to award

the bulk of our projects within the programed amounts bears testi-

mony to the professionalism of our estimators. However, their labors

have not been without problems. When we appeared before you last

year we were estimating 'an escalation increase during calendar year

1973 of 7 percent. However, it now appears that it may reach 10 per-

cent. Such "real world" problems are not new and over recent years

we have learned to live with them. One important method of minimiz-

ing the effects of cost growth is to increase the percentage of projects

which are awarded in the first year they are authorized. Considerable

high level attention has been devoted to improving the first year

obligation rate and these efforts are beginning to get results. I am

pleased to be able to report that the obligation rate for the fiscal year

1973 program will show improvement over past performance. Our

biggest problem in this regard is with pollution abatement projects.

We are delayed sometimes by changes to local and State standards;

also by the necessity to participate in regional sewage disposal sys-

tems. Although the going sometimes seems slow, we -are resolving these

problems as quickly as possible.

MAINTENANCE BACKLOG

Before concluding, I would like to touch on the subject of main-

tenance and repair of Army facilities which is related to the "Opera-

tions and Maintenance" appropriation. Last year we reported that by

the end of fiscal year 1971 the backlog of essential maintenance and

repair, referred to as BEMAR, had been reduced to $241 million.

During fiscal year 1972, BEMAR was further reduced to $223 million.

By the end of fiscal year 1973 we hope to further reduce it to about $200

million. However, the outlook for fiscal year 1974, based on the budget

level, is not as optimistic and we are projecting a rise to about $230

million. Furthermore, we estimate that there will be an additional

$40 million of deferred maintenance work, consisting mainly of minor

projects of less than $10,000, not meeting the definition of BEMAR.

It is true that we are hampered by the perennial problems of cost

escalation and budgetary restraints. However, there is a growing prob-

lem in the maintenance area that is becoming increasingly difficult to

deal with. Modern day facilities are becoming much more complex,

particularly with regards to equipment installed in them. As a result,

the unit cost of maintenance is continually rising. Hospitals are a prime

example of this trend. This problem is not unique to the Army. The

private sector is also experiencing rising costs to maintain today's

sophisticated buildings. One tool which we expect will help us cope

with this problem is the integrated facilities system which we are

developing.

Mr. SIKES. Will you keep us up to date, Mr. Brazier, on the inte-

grated facilities system in order that the record will be more complete!

Mr. BRAZIER. Yes, Mr. Chairman, I will be happy to. At the present

time we have completed a manual test for the first increment of the

system at two installations. Based on that experience, we have com-

pleted detailed specifications for the automated system and it is now

being designed. Prototype testing will be conducted beginning in

March 1974 and implementation of this first increment is scheduled to

begin in August 1974. The system is being designed to give us not

only a detailed analysis of current costs and deficiencies but also far

more accurate projections of maintenance requirements so that in the

design of individual facilities for construction, we will be able to make

the fullest possible use of life cycle costing techniques to obtain the

best possible return for the taxpayer's dollar.

This concludes my statement. Major General Cooper will follow

me with his statement which will give a more detailed look at this year's

request.

I'll be pleased to answer any questions you may have.

167

[Additional information follows:]

At the hearings of the House of Representatives Committee on Appropriations

on March 3, 1970, information was inserted into the record detailing the integrated

facilities system (IFS). The system was under development at that time. The

following information is provided to update the status of development and im-

plementation of the integrated facilities system.

The system concepts have been tested at two installations and found to be

valid. The resulting economic analysis indicated at a future cost savings through

the elimination of need for "blue colar" workers to spend so much time on "white

collar" work. The test also demonstrated that IFS will be readily able to provide

much better information on facility condition, requirements, and utilization than

is presently available.

The Army has already adapted reports similar to those which will be produced

by IFS to obtain some information on unconstrained requirements for real prop-

erty management activities.

The detailed functional specifications for the first increment, incorporating re-

sults of the test, have been completed and approved by the Assistant Secretary of

the Army (financial management). The Computer Systems Command of the Army

is already programing with a target completion date of October 1973. System

integration tests are scheduled for November 1973 and live data prototype tests

for March 1974. Implementation of the system at Conus installations will begin

in August 1974 with a target completion date of November 1975.

Concurrently, action is underway to develop additional capability in the IFS

for use in providing guidance for utilization of facilities and development of

future requirements.

With completion of the full system in October 1976, the Army will have the

capability required, as detailed in the March 1970 hearings, to meet staff respon-

sibilities in all areas of facility management.

Mr. SIKEs. Thank you, Mr. Brazier. This is a very good statement

and a very interesting statement.

General Cooper, again we are happy to have you with us. We con-

gratulate you upon your assignment to this work. You follow a number

of able predecessors. We are looking forward to cooperating with you

in the important work which lies ahead.

As I have stated, your biography will also appear in the record.

BIOGRAPHICAL SKETCH OF MAJ. GEN. KENNETH B. COOPER

[The biographical sketch follows :]

Kenneth Banks Cooper was born at Fort Leavenworth, Kans., November 12,

1923, the sixth of seven children born to Col. and Mrs. Avery John Cooper.

After attending schools in Washington, D.C., New York, and Hawaii, he was

graduated in 1940 from Bayside High School, Long Island, N.Y. He attended

the U.S. Military Academy, as did his three brothers, and was graduated fifth

in the class of 1944.

After 3 months at Fort Belvoir, he was sent to the Southwest Pacific area.

He served with the 46th Engineer Construction Battalion in Leyte, Luzon, and

Japan in various positions from platoon to battalion commander.

In the fall of 1946, he returned from Japan to Sandia Base, N. Mex., for

assignment to the Manhattan project, later the Armed Forces special weapons

project. In addition to his task as a technical operations officer, he served as

special assistant to Lt. Gen. Leslie Groves, Chief. AFSWP, and participated in

the Sandstone atomic weapon test at Eniwetok in 1948.

Following attendance at the U.S. Naval Postgraduate School and at MIT,

studying civil engineering and nuclear physics, he spent 4 years, 1951-55, with

the Atomic Energy Commission in Washington, working on the development,

production, and stockpile requirements for nuclear weapons.

He was assigned to SHAPE. Paris, France, as a nuclear plans staff officer

from 1955-58. After completing the course at the Command and General Staff

College, Fort Leavenworth, in 1959, he joined the Advanced Research Projects

Agency, Office of the Secretary of Defense, where for 4 years he was concerned

168

with ballistic missile defense research, primarily reentry physics phenomenology

and radar and optical measurements of reentry vehicles.

Following a command tour in Korea (76th Engineer Battalion). he attended

the Army War College at Carlisle, graduating in 1965. General Cooper's tour

as director of the Army nuclear power program was cut short in the fall of

1966 when he was one of the first officers assigned to the newly organized

Defense Communications Planning Group in Washington. He was assigned as

executive to the Secretary of the Army, Stanley R. Resor, in July 1968.

From May 1970 to July 1971, he was assigned to the Republic of Vietnam

as the Deputy Commanding General, U.S. Army Engineer Command, and the

Commanding General, 20th Engineer Brigade. His assignment just prior to his

assuming his present position in December 1972 as Director of Installations,

ODCSLOG, DA, was as the Deputy Director of Civil Works, Office of the Chief

of Engineers.

His decorations include the Distinguished Service Medal with Oak Leaf

Cluster and the Legion '\ orT* with Ohl T,of ClstePr.

General Cooper is married to the former Barbara Nesbit of Washington,

D.C. They have two sons, Kenneth and Robert.

Mr. SIKEs. You may proceed with your statement.

STATEMENT OF DIRECTOR OF INSTALLATIONS

General COOPER. Thank you, Mr. Chairman.

Mr. Chairman and members of the committee, I am Maj. Gen.

Kenneth B. Cooper, Director of Installations, Office of the Deputy

Chief of Staff of Logistics, Department of the Army.

It is a privilege to appear before this committee and to present the

Department of the Army's portion of the military construction appro-

priation request.

We have structured our budget to reflect the Army reorganization

and realinement actions announced in January and April 1973.

FISCAL YEAR 1974 REQUEST

The Army is requesting an appropriation of $664,900,000 for new

obligational authority (NOA) within a total obligational authority

(TOA) of $706.900,000. The $24 million difference between NOA and

TOA is to be financed by expected NATO recoupments of $20 mil-

lion and estimated savings of $42 million from prior-year programs.

Included in our appropriation request is $14,075,000 for three pre-

viously authorized but unfunded projects, $1,186,000 deficiency fund-

ing for three previously authorized projects, and $51,500,000 for

planning and minor construction which are authorized by continuing

legislation. Our companion request for new authorization totals $660,-

139,000 which includes $20 million for NATO infrastructure for which

we are not requesting funding.

Of the total request $563.819,000 is for construction within the

United States and $88,581,000 is for construction outside the United

States, including projects in Europe, Korea, Panama, Puerto Rico,

the Marshall Islands, and U.S. Army Security Agency and U.S. Army

Strategic Communications Command sites.

As the core of this year's program, we are continuing to emphasize

facilities which benefit the soldier: where he lives, where he plays,

and where we treat him when he is sick. Over 84 percent of our re-

quest for construction, excluding NATO and "General Authoriza-

tion," is in these categories. I will discuss this in more detail in a

moment.

169

The construction planned outside of the United States is approxi-

mately 12.5 percent of our total program. This overseas program is

similar to fiscal year 1973, providing for only a limited number of

operational facilities and a few projects in support of troop welfare,

all at locations where we expect to stay in our long-range planning.

Also, as in fiscal year 1973, we are requesting no authorization or funds

for construction in the Republic of Vietnam.

Continuing the procedure established in fiscal year 1968 this pro-

gram contains $60 million to support the U.S. share of infrastructure

construction for the collective defense of the North Atlantic Treaty

Organization. We propose to provide detailed support for this request

at a later session.

Our fiscal year 1974 request includes $14,394,000 to provide facili-

ties for air and water pollution abatement at various Army installa-

tions in the United States. This is lower than in recent years. The

fiscal year 1972 and fiscal year 1973 programs were the peak years

and provided nearly $131,300,000 'to satisfy the requirements of Ex-

ecutive Order 11507 as best we could determine. The fiscal year 1974

program will satisfy newly identified requirement derived from in-

creasingly more stringent standards and accomplish projects deferred

from earlier programs for technological reasons. We do not yet know

the magnitude of the requirements which will result from the Federal

Water Pollution Control Act Amendments of 1972. We anticipate

that we may need some sizable dollar amounts for pollution abate-

ment projects in future MCA requests.

We are not requesting any funds for the Safeguard program.

Before discussing the highlights of our program, I would like to

call your attention to the following tables which give summaries of

the program. Table I shows the distribution of the appropriation re-

quest of $706,900,000 among major commands in the United States and

overseas.

[The table follows:]

TABLE I.-PROPOSED FISCAL YEAR 1974 MILITARY CONSTRUCTION, ARMY PROGRAM

Inside the United States

Comand: coat

U.S. Continental Army Command--.---------------------- $413, 809, 000

1st Army--- ---------------------------------_ (66, 891,000)

3d Army ------------------------------------- (153, 476, 000)

5th Army -------------------------------------(155,697,000)

6th Army._ -------------------------------------(37, 745, 000)

U.S. Army Materiel Command---------------------------- 58, 649, 000

U.S. Army Security Agency----------------------------- 287, 000

U.S. Army Strategic Communications Command------------ 8, 226, 0(0

United States Military Academy------------------------ 30, 145, 000

U.S. Army Medical Department------------------------ 12, 827, 000

Office Chief of Engineers-------------------------------- 597, 000

Military Traffic Management and Terminal Service --------- 5, 716, 000

U.S. Army, Alaska_ -----------------------------------8, 344, 000

U.S. Army, Hawaii---------------------------------- 10, 825, 000

Various locations, air pollution abatement facilities--------- 7, 295, 000

Various locations, water pollution abatement facilities ---- 7, 099, 000

Total inside the United States $------------------- 563, 819, 000

170

Outside the United States

Cost

Command :

U.S. Army Forces, Southern Command-------------------- $8,095, 000

U.S. Army Pacific-- ----------------------------- --------- 1, 568, 000

Puerto Rico------------------------------------ 517,000

Kwajalein Missile Range--------------------------------- 2, 353,000

U.S. Army Security Agency------------------------------ 1, 434,000

U.S. Army Strategic Communications Command------------ 2,097, 000

U.S. Army, Europe---------------------------------- 72, 517, 000

Germany ---------------------------------------------- (12, 517, 000)

NATO infrastructure-------------------------- ------- (60, 000, 000)

Total outside United States-------------------------- 88, 581, 000

Other

General authorization-------......---------------------------- 51, 500, 000

Planning ----------------------------------------------- (39, 000,000)

Minor construction----------------------------- -------- (12,500,000)

Section 102 (classified project) )----------------------- 3, 000, 000

Total obligational authority requested---------------- 706, 900,000

General COOPER. Table II shows the construction categories in

which the funds are requested and the percent of the construction

dollars in each category. This table illustrates the emphasis being

placed on facilities supporting our soldiers.

[The table follows:]

TABLE II.-PROPOSED FISCAL YEAR 1974 MILITARY CONSTRUCTION, ARMY PROGRAM

SUMMARY BY CONSTRUCTION CATEGORIES

Percent of total

excluding NATO

and general

Total authorization

Operational and training facilities---........................... 522,301,000 3.7

Maintenance and production facilities----.....-.-..................... 16, 418, 000 2.8

Research, development, and test facilities...---....------------------ - -11, 183,000 1.9

Supply facilities.---------------------------------------- 8,101,000 1.4

Hospital and medical facilities- - - --............. - --..... ...... ..... 45,807,000 7.7

Administrative facilities...................._ .. .......... . . ... .. 6,038, 000 1.0

Housing and community facilities-- ---.-....................... 453, 391, 000 76.0

(Troop housing)- .-------------------------------- ----- (405, 213, 000) (6.

(Community facilities) ---------------------------------------------- (48,178, 000) (

Utilities and ground improvements....... ..------------- ---...... 29,455,000 4. 9

(Air pollution abatement facilities)----........................ (7, 295, 000) (1.2

(Water pollution abatement facilities)---- ...................(7,099,000) (12

(Other)....------------------------------------------------------ (,061, 000) (

Real estate ........ 2, 706, 000 .5

RATOate ------------------------------------------------------- 60,000, 000 ..........-----

General authorization.....--------------------------------------------- 51, 500, 000 ................

Total obligational authority requested............_._........._ -. 706, 900,000 100.0

THE ARMY MODERN HOUSING PROGRAM

The priority element of our soldier oriented program this year,

as with last year, is that portion directed to bringing our Army hous-

ing to adequate and modern standards. We first presented the Army's

housing program for the seventies in the fiscal year 1972 budget. Our

program goal is to provide modern housing for all bachelor soldiers

and families. We are controlling both the programing and execution

phases to assure that we get the right type of housing, in the right

amount, at the right place, and at the best design and cost we can

manage. Since this presentation covers our general MCA program

which provides for the bachelor housing support, my remarks will be

directed to that portion of the housing program. Subject to your

approval, the family housing portion will be covered during a later

hearing.

BACHELOR HOUSING

The fiscal year 1974 program provides for construction of 24,553 new

enlisted barracks spaces and 285 bachelor officer spaces in the United

States and overseas. Included in these are 3,935 enlisted and 100 officer

spaces for the Women's Army Corps and 380 enlisted spaces pro-

gramed for semipermanent construction overseas. In locating this new

construction; emphasis has been placed on those troop stations which

have the largest deficits in bachelor housing and which are included in

the Army's long-range planning. We are requesting $242,577,000 for

this year's new construction portion of the bachelor housing program.

In our fiscal year 1974 budget request we are asking for $146,311,000

to modernize 46,896 enlisted barracks spaces and 528 officer spaces. Of

the barracks spaces, 45,397 are in the United States (including 3,587

for enlisted women) and 1,499 are overseas. All officer spaces are in

the United States.

Recent changes in criteria for new construction and modernization

have had a great impact on the Army's barrack assets insofar as their

classification into "adequate" or "substandard" is concerned. Those we

now classify as not meeting current standards may vary from pre-

World War I buildings on some of our older posts, to relatively new

barracks from our MCA programs of the 1960's. The amount of work

required to bring these various buildings to current standards varies

widely from a matter of internal partitioning to subdivide the open

bays into rooms for one, two or three men to total renovation required

for some of the older buildings.

I would like to cite some statistics to illustrate the status in ade-

quately housing all of our soldiers and the size of the task still to be

accomplished.

Requirements. Based on the long-range (fiscal year 1978) strength

projection, it is presently estimated that housing will be required for

approximately 497,000 soldiers of whom 60,000 will be trainees. It will

also be necessary to house an estimated 34,000 bachelor officers.

Assets. Including construction and modernization in progress or

already approved in fiscal year 1973 and earlier programs, the Army

has approximately 397,000 permanent barracks spaces and 27,000

bachelor officer spaces worldwide. Both in the United States and over-

seas we have a wide variety of permanent buildings, semipermanent,

and temporary structures being used for troop housing. As indicated

earlier, except for trainee barracks in the United States, recent changes

in housing criteria such as air-conditioning where required and semi-

private or private rooms have caused approximately 40 percent of these

existing permanent assets to be classified as inadequate under currently

accepted standards.

Deficits. Comparison of the assets and requirements indicates that

deficit exists of approximately 100,000 enlisted barracks spaces and

about 7,000 bachelor officer quarters spaces. This deficit must be met by

new construction. Plus, we must continue to modernize those existing

permanent assets, over 158,000 spaces, that are below standards.

Current bachelor housing standards provide a significant departure

from the open-bay barracks which have been our standard in the past.

We are striving for increased privacy, more comfortable living condi-

tions, and improved security for the soldier's personal possessions. For

the lower grades (E2-E4) we are building or modernizing to create

two- or three-man rooms at 90 square feet of living space per man.

The new construction will provide a bath with each room as will

modernization projects wherever practical. The middle grades (E5-

E6) will normally have one- or two-man rooms at 135 square feet of

living space per man and the senior grades (E7-E9) will be authorized

a private room with 270 square feet of living space and a private bath.

Air-conditioning, increased lighting and electrical outlets, improved

furniture, and secure storage areas are inherent features in our designs.

For the junior officer (01-02) we are providing 330 square feet of

living space consisting of a private combination living/bedroom, bath-

room and pullman type kitchen. Grades 03 and above will have a pri-

vate suite of approximately 460 square feet. The accommodations will

consist of a living room, bedroom, bathroom, and kitchen.

The Army considers these standards to be both necessary and just

and not extravagant. They are in keeping with improved living con-

ditions which prevail in the United States today.

COMMUNITY FACILITIES

Also of importance to the soldier are the community functions

related to his and his family's daily needs. Our request for these items is

$37,448,000 (exclusive of confinement facilities), which provides for a

number of diverse facilities including new commissaries at Forts

Campbell, Gordon and Polk, chapels centers at Aberdeen Proving

Ground and Redstone Arsenal, automotive self-help garages at Forts

Gordon and Greely, a physical conditioning facility at Carlisle Bar-

racks, a gymnasium at Fort McClellan, outdoor athletic facilities at

Fort Riley, a patient visitor facility at Walter Reed Army Medical

Center, service clubs at two locations, a post library and gymnasium

addition at White Sands Missile Range, a main post office at Fort

Eustis, an NCO open mess at Yuma Proving Ground, and a billeting

office, an officers' open mess, and a provost marshal facility at Fort

Wainwright.

We are including in our request $12,091,000 to improve the schools

for our dependent children in Germany. We plan to build additions at

three locations and to construct new facilities at two locations to reduce

overcrowding and alleviate substandard conditions. The necessity for

improvement of the dependent educational facilities in Germany has

been recognized for several years and these projects will continue and

expand the Army's efforts to improve the dependent school system.

MEDICAL FACILITIES

Our request for $45,807,000 for medical facilities is about S percent

of our program. The largest single project in this category is a $25

million new hospital at the Military Academy. We have included an

addition for the permanent hospital at Fort Lee, new dental clinics at

Forts Carson, Lewis, and Monmouth, and a combined medical and den-

tal facility at Fort Shafter.

The request includes $10,830,000 for the parking facility at Walter

Reed Army Medical Center which was authorized but not funded in

fiscal year 1972. Although the parking facility is not technically in the

category of medical facilities, it is an integral part of the new hospital

building and the overall center modernization project and hence we are

reporting it in this section dealing with our medical program.

WOMEN'S ARMY CORPS EXPANSION PROGRAM

An important segment of our request supports the expansion of the

Women's Army Corps which will double the size of the corps by fiscal

year 1978. Over $47,893,000 are allocated to this portion of the fiscal

year 1974 MCA program. The key projects expand the housing, train-

ing, and administrative facilities at Fort McClellan, the WAC center.

The remaining projects are for housing at various posts, as noted ear-

lier, to provide adequate quarters for the increased WAC population.

AVIATION FACILITIES

This year's request contains eight projects totaling $19,195,000,

related to Army aviation activities. These include two projects at Fort

Hood, one at Fort Sherman, Canal Zone, and one in Korea, all in sup-

port of Army contingency requirements. Helicopter landing facilities

are planned for Fort Belvoir and runway improvements are requested

for Fort Huachuca in the interest of safety, maintenance, and opera-

tional efficiency. Improvements are also planned for the airfield facili-

ties at Fort Rucker. The third and final phase of the tactical airfield

complex at Fort Campbell is included this year and will complete the

project started in fiscal year 1972.

U.S. MILITARY ACADEMY

This year we are requesting $30,145,000 for three projects: the

new hospital, utilities expansion, and barracks modernization. These

projects have been recommended for approval by the West Point

Planning Advisory Board as being necessary and in consonance with

the USMA expansion plan.

RESEARCH AND DEVELOPMENT

The Army's total request in this category is $11,183,000, consider-

ably lower than the $59,872,000 approved in fiscal year 1973 when we

were completing the construction of two major laboratories. The

human factors engineering laboratory at Aberdeen Proving Ground,

an addition to the explosive laboratory at Picatinny Arsenal, and the

KOFA Range improvements (phase I) at Yuma Proving Ground

are the major projects of the research, development, and testing pro-

gram this year. There are seven other smaller, but necessary, projects.

CONFINEMENT FACILITIES

The Army is also requesting two new confinement facilities in

fiscal year 1974 as a continuation of our long-range program for pro-

viding modern facilities for confinement of military personnel ac-

cused or convicted of violations of military law. This long-range pro-

gram is based on the Army's modified correctional system. We fore-

see construction requirementns extending into fiscal year 1977, at a

dollar level approximating that of fiscal year 1974, to provide the

necessary facilities support. The new facilities proposed in the fiscal

year 1974 MCA program will be located at Forts Leonard Wood

and Lee at a cost of $10,730,000.

ENVIRONMENTAL POLLUTION ABATEMENT

In support of the national goal of reducing environmental pollu-

tion the Army has included $14,394,000 in the fiscal year 1974 MCA

program to improve pollution abatement capabilities at 27 installa-

tions in 22 States. Of the total program cost, $7,295,000 is for air

pollution abatement and $7,099,000 for water pollution abatement,

including $300,000 for a previously approved project which now re-

quires revision. Our program includes incinerators for explosives and

contaminated waste disposal, facilities for treatment of industrial

wastes, precipitators on smokestacks, connections to regional sewage

systems, air and water pollution monitoring stations, and the up-

grading of existing sewage and water treatment plants to conform

to local and Federal standards. These projects have been coordinated

with other Federal agencies involved in pollution abatement and are

in phase with the environmental pollution control program.

As indicated earlier, several of our projects are based on more rigid

standards or on technological advancement in pollution control. We

expect future requirements to be generated in a similar manner,

particularly as the States begin to implement their programs to

achieve the goals established in the Federal Water Pollution Control

Act Amendments of 1972.

ELECTRICAL SUPPLY AND DISTRIBUTION

This year we are again requesting funds to modernize the electrical

systems on a number of our permanent installations, many of which

are now inadequate and approaching unsafe conditions. The con-

tinuing rise in the demand for electrical power due to changes in

communications, modern weapons, training techniques and living

standards, especially the desire for air-conditioning, has overtaxed the

electrical systems on many Army installations. To rectify this situa-

tion approval is requested to upgrade the electrical utilities at three

installations in the United States at a cost of $4,079,000. We are again

requesting improvement of electrical facilities at various strategic

communication sites overseas at a cost of $2,097,000.

AIR-CONDITIONING

Mr. SIKES. What is the situation generally on air-conditioning at

Army installations? The Army is probably the last of the services to

begin to stress air-conditioning. This committee has supported air-

175

conditioning generally because we recognize the increased efficiency

and comfort that come from air-conditioning. What is the overall

picture on air-conditioning of Army facilities?

General COOPER. With regard to barracks, we are really just getting

started. We are doing air-conditioning as part of the 1972 program,

and some of that has been completed. For the most part, almost none

of the barracks were air-conditioned prior to those built in 1968.

By the time we get through with our modernization program, all the

barracks in areas which qualify under Department of Defense criteria

will be air-conditioned. We are just getting started. That is what it

amounts to, sir.

Mr. SIKES. I thought that would be the situation.

General COOPER. For example, at Fort Campbell, only 7 barracks

are air-conditioned, and those were built after 1968. Some of the trainee

barracks which were built recently are air-conditioned.

Mr. SIKES. I think we can well afford to place added stress on air-

conditioning.

Mr. DAVIS. Is this a good place to put in the record a general out-

line of the criteria with respect to air-conditioning ?

Mr. SIKES. Would you please do that.

[The information follows:]

The criteria for air-conditioning is contained in Department of Defense "Con-

struction Criteria Manual" DOD 4270.1M. Chapter 8 of this manual establishes

weather zones based on the wet and dry bulb data of specific locations published

in TM 5-785, "Engineering Weather Data" by the Departments of the Air Force,

the Army, and the Navy. For new facilities, air-conditioning is permitted in per-

sonnel living space where the wet bulb temperature is 67 F. or higher 1,000 or

more hours during the 6 warmest months of the year or where the dry bulb

temperature is 80 F. or higher for more than 650 hours during the 6 warmest

months of the year.

For existing facilities, air-conditioning is permitted in personnel living space

where the wet bulb temperature is 67 F. or higher 1,400 or more hours during the

6 warmest months of the year or where the dry bulb temperature is 80 F. or

higher for more than 900 hours during the 6 warmest months of the year.

Generally, for all other occupied facilities such as dining, administration,

chapels, libraries, classrooms, etc., air-conditioning is permitted where the wet

bulb temperature is 67* F. or higher 800 or more hours during the 6 warmest

months of the year or where the dry bulb temperature is 80 F. or higher for 350

or more hours during the 6 warmest months of the year.

Medical facilities are air-conditioned on the same basis as above except critical

areas such as operating, recovery, nursery, et cetera, are air-conditioned in all

weather zones.

KWAJALEIN MISSILE RANGE

General COOPER. The Kwajalein Missile Range in the Marshall Is-

lands is a national range for testing various types of equipment in the

Nation's missile programs. The continuing development of test facil-

ities in this area and the major testing programs underway make it

necessary to request improvements of a variety of facilities. We are

asking for a total of $2,353,000 for three projects.

SUMMARY

In summary, we have designed the fiscal year 1974 MCA program to

enhance the welfare of the soldier by improving our bachelor housing,

primary medical care facilities, and community facilities. In addition,

the Army is continuing its efforts to control environmental pollution

20-192 (Pt. 1) 0 - 73 -- 12

176

and to improve its operational capability. We have given careful con-

sideration to insuring that the projects requested are located at "hard

core" installations where the facilities will be fully utilized.

This concludes my presentation of the Army's fiscal year 1974 Mili-

tary Construction Appropriation request. The detailed project justifi-

cations supporting the Army request are contained in the book which

has been furnished to the committee. The projects are arranged in com-

mand and station sequence.

I will be pleased to answer any questions the committee may have or

to see that the answers are provided.

LESS FIRM INSTALLATIONS

Mr. SIKES. Thank you very much, General Cooper. You have said

these requests are for hard core installations where the facilities will

be fully utilized during the foreseeable future.

General COOPER. With very minor exceptions, sir. Since the forma-

tion of this program, there are a few minor exceptions which I will get

into as we go through the individual projects. We have programs in

the 1974 program that are not hard core.

Mr. SIKES. We will cover that general subject in detail.

ARMY'S LONG-RANGE PROGRAM

Mr. Brazier, you discussed the Army's backlog of deferred con-

struction. Will you provide for the record the current estimate for the

backlog and break that out by categories of facilities?

Mr. BRAZIER. Yes, Mr. Chairman.

[The information follows:]

ESTIMATED BACKLOG OF DEFERRED CONSTRUCTION

Facility class: Millions

Operations ---------------------------------------------- - $402

Training -------------------------------------------------------____________ 518

Maintenance and production-------------------------------------867

Research and development ------------------------------------ 454

Supply ------------------ -- 393

Medical -------------------------------------------------------- 711

Administrative -- - -- - -------- 474

Housing (bachelor) -------------------------------------------____________1,371

Community support------------------------------------------- _____866

Utilities -----------------------------------------------------_________________ 468

Total ------------------------------------------------------ 6,524

Mr. SIIES. I would also like to have provided for the record the

amounts which the Army plans to request in fiscal year 1974 and the

4 subsequent years, and the resulting backlog which you would ex-

pect at the end of the fiscal year 1978 program.

Mr. BRAZIER. We will provide that, Mr. Chairman.

177

[The information follows:]

ESTIMATED FISCAL YEAR 1974-78 MCA PROGRAM

lIn millions of dollars]

Fiscal year Fiscal year

Facility class 1974 1975 78

Operational.-----------..................------------------------------------------------ 15 40

Training------....................------------------------------------------------ ------- 8 104

Maintenance and production............................----------------------------------------..................... 16 107

Research and development-------------................------------------------------------ 11 105

Supply------------------------------------------------------------------------ 8 62

Medical---------------------------------------------------------------------- 46 681

Administrative........-------------------------------.......................................---------------...... 6 40

Bachelor housing...........................-----------------------------------------------------..................................... 405 1, 224

Community support..............................----------------------------------------------------- 48 238

Utilities.............................------------------------------------------------------------- 32 74

Total............................... ..----.......... .........-.......... 595 2, 675

The above figures take into consideration escalation.

It is difficult to estimate what the backlog will be at the end of fiscal year

1978. However, one can assume that it will still be considerable. Reasonable

estimate of the backlog would be :

Facility Class : Millions

Operational ---------------------------------------- $370

Training -------------------------------------------- 440

Maintenance ---------------- ------------------------ 790

Research and development------------------------------- 350

Supply --------------------------------------------- 340

Medical --------------------------------------------- 35

Administrative --------------------------------------450

Bachelor housing---------------- ----------------------------- 60

Community support--- ---------------------------------600

Utilities -------------------------------------------- 380

3, 815

Mr. DAVIS. I would like to get a little better picture of what you

define as a backlog of deferred construction. When we talk about this

in Public Works, we speak of the authorized projects that have not

been funded. I gather from your comments that when we talk about

that in this connection, we are not necessarily talking about authorized

projects. This is a kind of in-house inventory of what the Army con-

siders to be its foreseeable necessary construction program for the

next few years. Is that coming pretty close to it?

General COOPER. Yes, sir. There is a difference from civil works

where you authorize projects and then fund them incrementally. In

military construction, you authorize and fund, with minor exceptions,

at the same time. The projects we are talking about are those which

are in our plans for the next few years.

Mr. DAVIs. General, to get another viewpoint of what might be

referred to as deferred construction, what does the Army have in

the way of construction projects which have been authorized but

unfunded?

General COOPER. I am not sure of the exact figure, but .I think it is

probably very small. It is almost an insignificant number. In 1974, we

had $10 million, for example, for the hospital out at Walter Reed, but

that was out of $112 million or so in the program. Normally, we do not

get projects authorized in the way they do in civil works in the Public

Works Committee. We have a long-range program, and we get a gen-

eral idea from the committees of whether that program makes sense.

We design our program around these long term ones, such as the

bachelor housing and family housing.

We also have in the backlog some less urgent items that may be in

our so-called long-range program, some administrative buildings and

things like that. We also in some cases are not replacing facilities as

rapidly as we should. We figure that they have a 50-year lifetime. If

you are doing everything in an orderly manner, you should be re-

placing some of those facilities just because they have outlived their

life. As you know, we still have some World War II facilities which

outlived their life in 1945. We are trying to get rid of all of those.

Does that answer your question?

Mr. DAvIs. Yes. I used the term "internal" in that connection as

being internal within the Army. When you refer to a backlog in the

sense in which you used it, does this connotate that these things have

been approved not only at the Army level but at the Secretary of

Defense level?

General COOPER. Not all of them, but many of them are included in

the 5-year Defense Program. That means they are approved for

programing. That does not mean they are finally approved for incor-

poration in the budget. There is a difference between projects which

are in the specific program which does go up to OSD, and projects

which are in the long-range program.

General KJELLSTROM. If I may, the only approved projects that you

see for the Army are the projects which are submitted to Congress

each year. There are many changes in the inner workings of the Army

and the Defense Department on individual projects from one year to

the next because of the priorities established by the Chief of Staff and

the Secretary.

GENERAL AUTHORIZATION

Mr. DAVIS. You have a general authorization. These, I would assume,

without demeaning it, are the cats and dogs of the program where

you do not exactly know what specific project you are going to allocate

a certain amount to, but you have a general impression. that you are

going to need this type of thing somewhere. Is that about it ?

General COOPER. This is in Mr. Brazier's statement.

Mr. BRAZIER. In general authorization, the biggest item is for plan-

ning, for designing a project in advance of the authority that the

Congress will give us later on to construct it. We design ahead. It

is to get the planning and design started so when we come to the

Congress for approval we know what the budget estimate should be

and we have a good basis on which to discuss it.

We start our design in advance of obtaining the authorization and

appropriation that will permit us to go ahead with the actual con-

struction.

General KJELLSTROM. That category also includes minor construc-

tion.

Mr. BRAZIER. That is correct, and access roads.

Mr. DAvIs. You would not have a clear conception of where these

so-called minor construction projects might be ?

Mr. BRAZIER. That is right. We use the word "urgent," urgent minor

construction. These are projects that come up on an urgent basis and

cannot be planned for ahead, but have to go ahead. We have authority

through that process to be able to construct certain projects.

FULL FUNDING

Mr. TALCOTT. You people understand that there is a difference

between authorization and appropriation on the military side just

as there is on the civilian side ?

Mr. BRAZIER. Yes, sir.

Mr. TALCOTT. You were talking about the civilian side being different

from the military side.

General COOPER. The difference is, the Congress on the civil works

side will authorize the project-a dam, for example, that might take

5 years to build at $200 million-but will appropriate only $50 million

for the first year.

Mr. TALCO'r. We do the same thing on the military side, do we not ?

General COOPER. Not very much.

Mr. BRAZIER. Walter Reed was an exception to the general rule.

General COOPER. That was only a small part of it. That is only $10

million out of $112 million. There is a difference in the way those are

handled. People have said, why don't you authorize switching either

the civil works side to the way the military construction is doing, or

vice versa ? That is always a source of debate.

Mr. TALCOTT. It is true that on the civil side they authorize a lot

more projects than can ever be appropriated.

General COOPER. That is correct.

Mr. TALCOTr. The same thing happens in the military, too, I think.

General COOPER. I do not know of very many.

General KJELLSTROM. Generally speaking, the appropriation follows

the authorization bill almost line by line.

Mr. TALCOTT. Maybe we will have to make that a little more tight,

to be sure you understand there is an Appropriations Committee, too.

General KJELLSTROM. We are not implying-

Mr. TALCOTT. What is the inference, then ?

General COOPER. There is a different system.

General KJELLSTROM. The authorization process precedes the appro-

priation process, and normally when we end the congressional process,

the approved projects of the four interested committees.

General COOPER. At least in theory-

Mr. TALCOTT. We will try to make the distinction a little better this

year.

General COOPER. At least in theory, the authorization hearings take

place before the appropriation hearings.

Mr. DAvIs. In theory.

General COOPER. In other words, we are not supposed to come and

ask for money unless something has been authorized.

Mr. TALCOTr. That is right. We try to do a lot of accommodating

here to make sure the process moves along. We hold hearings as quickly

as we possibly can. But there is a function of the Appropriations

Committee.

General COOPER. Absolutely, sir. If you infer from anything I said

that there was anything else but, I apologize. It was not in any way

my intent to ascribe any lesser role to the appropriations than to the

authorizations. They are both required.

UNOBLIGATED BALANCE

Mr. DAVIS. Maybe this is a good time to put into the record an indi-

cation of what your unobligated balance will be at the end of this

fiscal year.

Mr. BRAZIER. We will provide that.

Mr. DAVIs. Maybe you had better give us the actual unobligated

balance as of the last date that you have available, which probably

would be the 1st of April.

General KJFELLSTROM. We have the March 31 figures.

Mr. DAVIS. And the estimated June 30 figure. In that way, we will

know what kind of unobligated authorized balance you have.

[The information follows.:]

Unobligated Balances : Thousands

June 30, 1972---------------------------------------------- $673, 969

March 31, 1973--------------------------------------------- 730, 224

June 30, 1973 (estimated) ------------------------------------ 429,924

'Includes $22 million applied to fiscal year 1974 program in the President's

budget.

BASE REALINEMENTS

Mr. TALCOTr. How can you talk about long-range, when you do not

know what your short-range planning is ? Right at this time, the Army

is trying to decide about base closures and consolidations. It appears

that you do not know what you are going to do. One time you are going

to close Fort Dix and another time you are not. You really do not

know what you are doing. The Secretary said, before he became At-

torney General, that base closures would be reviewed again. How can

you really talk about long-range when you do not know what your

short-range is?

General COOPER. We know the long-range strength is based on hav-

ing 13 divisions. We know approximately at the end of fiscal year

1974 it is supposed to be 804,000. It will not end up exactly 804,000 at

the end of that year. I would not try to say that it would.

Mr. TALCorr. So, you can look at your long-range needs better than

you can your short-range plans?

General COOPER. We know the basis of what the Army is supposed

to look like in terms of the structure. The physical location of all those

elements we know really quite well, too. There are some installations

that we may phase out in the future, but that won't affect in a major

way the end strength, as long as you have 13 divisions.

Mr. TALCOTT. We are talking about military construction. We are

talking about facilities. They have to be located someplace. They can-

not be moved around as easily as troops can.

General COOPER. That is right, sir. That is the reason that when we

looked at the 1974 budget, initially we tried to be very sure that any

military construction that we asked for was at a base we expected

to remain active, almost regardless of how these things changed. There

are inevitably some changes, but I think they are very minor changes,

not major changes.

CONSTRUCTION FOR LAST TEN YEARS AT BASES AFFECTED BY REALINEMENT

Mr. TALCOTT. Somebody told me we spent $150 million in the last

10 years at Fort Dix. I cannot find even a small percentage of that

amount that went through the Appropriations Committee. Is that

possible ?

General COOPER. I do not believe that could be possible. We can-

not spend money without its going through the Appropriations Com-

mittee. I will defer to General Kjellstrom. It would be a very small

amount.

Mr. TALCOTr. Will you tell me what you spent at Fort Dix in the

last 10 years?

General KJELLSTROM. For construction, sir?

Mr. TALCOTr. Yes.

Mr. SIKES. Construction at all levels and from all funds, including

Southeast Asia; funds which might have been spent for emergency

purposes there.

Mr. McEwEN. I wonder, Mr. Chairman, if we might include in

that request all of the bases that have been subject to closure, not only

Dix, but what has been spent in the last 10 years on all of these.

Mr. SIKES. On all bases for which closure action has been an-

nounced?

Mr. McEwEN. Yes.

General COOPER. I believe we have provided the information to the

staff. We are now revising it.

Mr. SIKEs. We have some of that information in the committee file,

but revise it and write it up to date.

Mr. TALCOTTr. The ones that are going to be closed, and Fort Dix.

[The information follows:]

CONSTRUCTION AT INSTALLATIONS TO BE CLOSED AND AT FORT DIX IN THE 10 PRIOR YEARS

[In thousands]

1964 1965 1966 1967 1968 1969 1970 1971 1972 1973

Alaska: North Fort Wainwright: Command Control Center- .....--------------------... 411

Georgia:

Hunter Army Airfield:

Electrical distribution improvement ----------------------------------------------------------------------------------- 1,150..

Atlanta Army Depot: 1, 150 ...

Install elevator in building 49 ......... .........-------- 49

Industrial waste treatment plant----------

Fire and rescue station - --............................. .-- -----------------107

Industrial waste treatment plant, deficiency---------------------------------------- ------------ - --- - 233

Storage modernization ..----------------------------------------------------------------

Industrial waste collection system.........------------------------------------------------------------------------------..

Mary-and:-Fort-H--abird:-Alter-boi-di-g-1---------------------------------------------------- 17------------------------

M a ry la n d : F o rt H o la b ird : A lte r b u ild in g 12 . .1 1 7 . .... . . . . . . .

New Jersey: Fort Dix: 489 ..

Telephone exchange addition--- _ __..........._ 108

elephone menc's bae aditon--------------------------l---41 ---------------------------------------------------------------------

Enlisted men's barracks complex .. ............ ... 4,241 ... . . . . . .. . . . . . . . . . .

Enlisted men's barracks complex.......-..-.... 21 0, 772 -_ ... 2-3, 812

Walston Army Hospital addition -- - ------------------- - 1, 633---- 2--585--------- - -- ----(DEF)886

Enlisted men's barracks complex---- ...............--.. .. 14, 092

Tactical equipment shop- .......... -- --------------------------------- 195

Dental clinic-- - - - - - - - - --620

Enlisted men's barracks complex--------------------------------- - 14, 565

Bachelor officer quarters ---- 195....... 2,--------------------- 2, 385 .

Training ranges..----...-.--..--...- . 1, 950

Imreate soppi y ste- -------------------------------------------------------------------635----------------- ---------

Improve water supply system......... 635--- -- -- --- .------------- 63

T rain ing Fa c-S E A. . . . ...... ... ....... 1. . 8 4.. ..... ..... ..... ...... ..... ..

Training Fac-SEA-.------------------------------------------------------------------------- - -814 -.....-.......------------------ CO

Enlisted men's service club ...--- 9-------------- -96-

Main post office .......... ......... ......... ......... .........976 -------------- ------- -------

Lain post odry ffice...----------------------------------------------- 488

LauReception sndryetactioni..------ ......... . . ----- -- --------------------------------- 3379

Improve sewage facilities---..----------- -- --------------- ------------ 5, 668----------

Barracks improvements... 2,624 ... . . .. .. .. . .. .. .

olr st age wa ------------------- -------------------------------400 . 2.....

Baracs mdeniztin------------------------- -------------------------------------------------------------- ------------5,671

Cold storage warehouse ----------------------------------------------------------------------------------------9

Barracks modern ation --------------------------------------------------- 1,215

Sewage treatment plant..-- - - ---------------------------------------- 5, 671

WPC monitoring stations 117

South Carolina: Charleston AD:i 25

Water pollution control projects---- ----------------------------------------------- 200 ------------------------ 143

Texas: Fort Wolters:i

Parking apron (heliport)..--------.....----... ---........--------... ...--------- 257

Academic buildings------------------------------- 1,040

Electrical distribution system .... -------------------------------------------------------------- 379

Aircrott paint~,04 shop-------------------------------------------------------------------25

Aircraft paint shop - .................--.......- -- 250

Air condition 10 permanent barracks---- -------------------------------------------------------------- 771

Library/study hall ---------------------------------.~. ---------------..---- -- 0 .-.--------------------60-

Additional latrines in barracks ............. ------------------- ---------------------------------------- --1 61

Miscellaneous sanitation and industrial waste-WPC ..------------------------------------------------------------

SSuplemental appropriations: Fort Wolters 216 Aircraft instrument trainer building. 248

iscal year 1966S aFort Wolters-------------- n10, 400 Aviation training base n ansion.

Hunter AAF-.-3..... 3,000 Aviation training base expansion. 3 buildings funded in fiscal year 1966.

n.~n ~..~.~~~~ ~ooo.-,...,, p p~nam O IL.,,,., ln ~ n~rij

FUTURE USE OF FORT DIX

General COOPER. We excluded Fort Dix after the change because we

are now in the process of doing the study to decide whether we will

keep the 6 Army training centers, including Fort Dix, or whether we

will put some additional units into Fort Dix and keep it open. Fort

Dix is up in the air as of the moment.

Mr. TALCOTT. Is that not true of the rest of the Army bases ?

General COOPER. No, sir.

Mr. TALCOrr. It is a pretty big installation not to be related to some

of the others.

General COOPER. When you say relate to others, it relates to other

installations, that is correct, sir, but in terms of the total number of

dollars we are asking for in fiscal year 1974, it does not relate in a

major way, in terms of percentage of the $700 million we are asking

for.

Mr. TALCOTr. I really do not understand that. If you are going to be

building facilities at one place or another, a major base would have

some relationship.

General COOPER. Yes, sir, it would have some relation, but I am

saying--

Mr. TALCorr. Are you going to build at these other places regardless

of what you do at Fort Dix ?

General COOPER. No; I think if we decide to keep an Army training

center at Fort Dix, there will be some facilities we will not build

elsewhere, and if we decide to backfill Fort Dix with other installa-

tions, it will take out MCA funds, but not necessarily out of the 1974

program. It may take funds out of the 1975, 1976, or 1977 program.

Mr. SIKEs. General Cooper, how is it that the status of Fort Dix was

not determined as of the time that other decisions were being reached

on base closure and base shifts ?

General COOPER. We did determine it within the Army. We were

asked by the Secretary of Defense to reexamine it. We are now in the

process of reexamining it as the Secretary of Defense announced in the

April 17 announcement of base closures.

Mr. TALCO'rr. Shouldn't we defer the whole military construction

consideration until you make up your mind what you are going to do?

General COOPER. No, sir, because I believe we can show you in each

case where we think Fort Dix might affect the 1974 program.

Mr. TALCOTT. But it is not just Fort Dix. There are many other in-

stallations in the Army.

BASES WHICH MAY BE AFFECTED BY FURTHER STUDIES

General COOPER. I am prepared to indicate the small number of bases

which we think have some probability of being affected by not just the

study and the backfill of Fort Dix, but our continuing study on the

realinement and base closures of particularly the small, single-mission

bases.

MAJOR FACILITIES DEFICITS

Mr. SIKES. Will you tell us briefly where the major facilities deficits

lie, in what areas ?

Mr. BRAZIER. Mr. Chairman, our major deficits at the present time

are in medical and bachelor housing facilities. We are essentially pro-

graming these to be completed within the seventies. However, as we

emphasize these two important areas, some other important areas will

fall behind. We think emphasis is required in these two areas, and this

is where we intend to put our money.

Mr. SIKES. Are you air-conditioning the housing which you are

building in the 1974 program?

Mr. BRAZIER. Yes, sir, we have air-conditioning where it is author-

ized.

MODERNIZATION AND REPLACEMENT

Mr. SIKES. YOu mentioned that the amount allocated to replacement

and modernization this year is $463 million, and that a realistic level

to meet these needs within 10 years would be $600 million to $700 mil-

lion a year. How does the amount proposed for modernization and re-

placement this year compare with last year?

Mr. BRAZIER. Last year, sir, our figure was $298 million. As you can

see, we are up considerably over our level a year ago.

Mr. SIRKES. Does that mean that the Army is falling behind in

modernization ?

Mr. BRAZIER. Sir, at the present, of course, we are catching up in

medical and bachelor housing but, yes, essentially we are falling behind

in the other classes.

ARMY STRENGTH

Mr. SIKES. The Army's average strength during fiscal year 1974 is

scheduled to be approximately 812,000 with an end strength of 804,000.

In the past, we have programed facilities for the Army based on long-

range strengths as high as 925,000.

What is the projected long-range strength upon which the Army is

basing its facilities planning this year ? Is that classified ?

Mr. BRAZIER. We have based this budget on a figure that is not

classified.

Mr. SIXEs. All right.

Mr. BRAZIER. It is approximately 804,000, sir.

Mr. SIXES. What long-range strength have you used ?

General KJELLSTROM. There is a classified figure which we should

provide for the record, which differs from this.

Mr. SIXEs. Very well.

[The information follows:]

The projected long-range strength of the Army is --

Mr. TALCOTT. What is the category of classification that you are

talking about ? Secret ?

General KJELLSTROM. Secret.

Mr. BRAZIER. The figure of 804,000 on which we based this budget is

not changed.

Mr. SIKES. Will you tell us how this long-range strength is trans-

lated into facilities requirement ?

Mr. BRAZIER. Each installation is provided a long-range projected

strength and force structure, and then by the application of our facility

allowance criteria, we determine what projects are required to support

the strength.

ARMY FORCES OVERSEAS

Mr. SIXES. What assumptions are you making with regard to the

number of troops to be stationed overseas and the number to be sta-

tioned in the continental United States?

Mr. BRAZIER. Our planning at the present time is based on the as-

sumption that the forces in Europe will remain about as they are at the

present time, but that there may be some reductions in other overseas

areas. At this time, there is nothing in our program for 1974 to support

a pullback of U.S. troops from overseas.

Mr. SIXEs. In other words, it is the policy at present to maintain

troop strength levels at the announced figures in different parts of

the world ?

Mr. BRAZTER. Yes, sir, as far as I know.

Mr. SIXES. If there should be a decision within the near future to

change that, it would, presumably, be politically based, required by

action of Congress or some similar action, and at the same time you

would have to revise your estimates. It is the Army's planning, based

on present policy, to keep troops about where they are at present .

Mr. BRAZIER. That is essentially correct, sir, but the possibility al-

ways exists that it may be necessary to make adjustments.

TIMING OF DECISION ON FORT DIX

Mr. SIKES. If there should be a change in the status of Fort Dix,

how quickly can that be translated into changes in your requirements

in this bill? We want to know whether we are safe in proceeding with

the consideration of the Army requests as they now are presented, or

whether we should delay pending a final decision on Fort Dix ?

General COOPER. By July 1, this year. we have to have our report

to the Secretary of Defense in this regard. It is difficult to predict, but

we see no reason why he would not act on it fairly promptly. We do

not expect major changes in this.

Mr. SIKES. The budget before us is essentially what the Army will

recommend?

General COOPER. Yes, sir. There may be some minor changes.

Mr. SIKES. You recognize the importance of keeping this committee

informed on what is done?

General COOPER. Yes, sir. We would expect in the month of July to be

able to tell you any changes as a result of the Fort Dix decision.

Mr. TALCoTr. How can you have confidence that the Secretary will

accept it when he did not accept it before? There is something wrong.

There is a difference between you and the Secretary about the manage-

ment of your affairs.

General COOPER. We do not know who the new Secretary of Defense

is going to be.

Mr. TALCOTr. It does not make too much difference who the person

is. No one man will make a lot of changes. Somebody in the Defense

T)Department is not happy with the way the Army manages its affairs.

That is the way it appears to me.

General COOPER. We can expect that what we recommend will be

provede, because as we are working through this study we will have

;n process reviews with the people from the Office of the Secretary of

Defense to be sure that the plan we come out with is not completely

ut of line with what they think it should be.

Mr. TALCOrr. I thought you were doing that before. That was the

;iDression you always gave us before.

General COOPER. No, Sil. I think that is probably not the case with

Fort Dix.

MODERNIZATION OF BARRACKS OVERSEAS

Mr. SIKES. In discussing the rate of replacement and modernization

-f troop housing and other facilities, how have you taken into account

."e modernization of the kasernes which is being carried out by the

'e-leral Republic of Germany ?

Mr. BRAZIER. Mr. Chairman, our program assumes that we will pick

up about 97,000 spaces as a result of the German offset agreements dur-

ing the period 1972 through 1975, and approximately 3,800 spaces

during the 1973 to 1974 time frame as a result of the Okinawa

reversion.

Mr. SIKES. How are you taking into account the construction which

the Army receives from the NATO infrastructure program?

Mr. BRAZIER. The NATO construction, of course, we do not have

nro.-ramed in this particular bill. We have money for the U.S. share

of NATO products in our bill. But NATO line items are not pro-

r:nmed here.

Mr. SIKES. IS there any construction other than that mentioned

which may be provided for by other foreign governments in return

for our release of facilities acquired under the status of forces agree-

ment? We know about Okinawa and you can provide some details

on Okinawa but are there others?

Mr. BRAZIER. Not to my knowledge. We will provide classified

details on Okinawa later in the hearings.

Mr. SIKES. Would the return of several brigades or a division from

Korea or Germany increase or decrease the total construction required ?

Mr. BRAZIER. Sir, that would depend on the type of unit that came

back. We would probably anticipate some increased construction

requirements.

As you know, an infantry division has a different requirement than

an armored or a mechanized division and it would depend on the

unit returning to the States, sir.

Mr. SIKES. Would a change in force levels overseas be immediately

reflected in a change in the military construction requirement? In

other words, would you avoid the construction of additional facilities

in those areas from which troops would be returned ?

Mr. BRAZIER. Yes, sir. There would be a reduction. For example, if

we return people from Europe, there would be a reduction of what

we would have to have in that area.

General COOPER. We only have $12 million for the European pro-

gram, and that is all for schools.

Mr. SIKES. Off the record.

[Discussion off the record.]

HEALTH FACILITIES MODERNIZATION

Mr. SIKES. NOW you mentioned the Department of Defense health

facilities modernization. Tell us something about the size of the Army's

portion of this program for the next 5 years.

Provide that for the record. Give details on requests for planning

and for construction funding in fiscal year 1973, 1974, and projected

for the next 4 years in connection with this program.

Mr. BRAZIER. We will be happy to do that, sir.

[The information follows:]

The Army's health facilities construction program was averaging less than

$40 million per year up until fiscal year 1972 when the Walter Reed General

Hospital replacement was authorized. This boosted that total for fiscal year

1972 to $112 million. In the fiscal 1973 program, medical projects were back down

to $35 million. The Department of Defense program decision memorandum,

issued August 30, 1972, allowed the Army to program an additional $481 million

in medical construction during the period fiscal year 1974 through fiscal year

1978. After some adjustments in the original plan, the current programing levels

are as follows:

[In millions of dollars]

Fiscal year-

1974 1975 1976 1977 1978

Medical MCA- - --................... . 46 168 153 170 186

Medical design cost................... 10 9 10 11 6

These figures are subject to change as the Department of the Army completes

its reorganization and as the individual requirements are analyzed and esti-

mates are refined.

POLICY ON BACHELORS LIVING OFF BASE

Mr. SIKEs. Will you discuss with us the Army's policy with regard

to allowing bachelor enlisted and officer personnel to live off base?

Do you anticipate any change in this policy?

Mr. BRAZIER. Yes, sir. By statute, bachelor personnel below the grade

of major, 0-4, must be assigned to Government-controlled quarters

if they are both available and adequate. Adequacy standards for as-

signment of bachelor personnel to government quarters are established

by the Department of Defense. If adequate quarters are not available,

personnel in grades E-7 through 0-3, warrant officers included, have

the option to seek housing in the local community and receive payment

of a basic allowance for quarters. Enlisted personnel in grades E-6

and below may be authorized to live off post and receive BAQ at the

discretion of the installation commander when the total capacity of

the installation's permanent and/or semipermanent barracks assets are

or will be exceeded.

The installation commander is responsible for determining when

available bachelor quarters .are adequate and suitable for assignment.

We have three things that an installation commander looks at when

he is making a determination.

First, he determines that the person is not required to live on the

base as a result of military necessity; second, the individual concerned

has to certify a desire to live off post and third, community support

facilities must be available for him to move into.

Mr. SIKES. Do you anticipate any change in this policy ?

Mr. BRAZIER. NO, sir, I do not anticipate a change in this policy.

Mr. SIKES. Apparently you had not finished your answer. What

else is there?

Mr. BRAZIER. I was going to say one example of how this works is

in the Washington, D.C., area, where we have a considerable number

of enlisted personnel living off the posts at which they serve because

we do not have on-post facilities for them.

Mr. SIKES. Do you require full utilization of existing space before

you give authorization for an individual to live off post?

Mr. BRAZIER. Yes, sir, in accordance with the criteria we have set

up; yes, sir.

Mr. TALcorr. Mr. Chairman?

Mr. SIRES. Yes.

Mr. TALCOrr. How do you have any input into the policy of the

service about who should live off base and who should not?

You are dealing directly with family housing, bachelor quarters,

so you should have a pretty good insight about what the men, as well

as the commanding officer, want. So somehow or other there should

be a dual input into the determination of what the regulations should

be concerning who is going to live off base.

It seems to me, as a layman, that we should encourage as many

people as possible to live in the community and still perform their

special job.

With the new Army, with new career advancement, better pay, and

all of these improvements, we are trying to make it more normal for

the servicemen. Is there any indication from your point of view that,

for instance, we should permit lower grades to live off base? Should

we reduce that age, or rank ?

I guess my basic question is: What input do you have in trying to

make policies which really relate to the family housing and bachelor

housing?

General COOPER. We make recommendations to the Office of Secre-

tary of Defense which establishes the policy Department of Defense-

wide. We do this based on our considerations of the mission require-

ment, which differs.

For most of the combat units or even the combat support units,

you want to have most of the troops on the base. It is also a function

of how close the base is to the nearest community. Certainly in family

housing, within these requirements, we do rely very heavily on com-

munity support. But we do not now contemplate a change in policy

which would permit anybody-and I realize this is an extreme case of

what you said-anybody to live off base because he prefers it.

We are trying to provide adequate facilities on the post now,

consistent again with the mission requirements.

Mr. TALCOTr. For those who are required to be on the post?

General COOPER. That is right.

Mr. TALCOrr. Have you made a different recommendation than

what their policy is now?

General CoOPER. Not to my knowledge.

Mr. SIKES. Well, let me see if I understand the situation.

Are you planning to provide housing on posts where there would

be ample availability of off-post housing for those who may be allowed

to live off post and who would like to take advantage of it ?

In other words, are you building more than is absolutely required

for the post requirements?

General COOPER. No, sir; not at this stage of the game.

At the very end of the program, we will have to look at that once

more. We are not even close to the point where we are building facili-

ties on the post for those people who could be appropriately housed

off the post. Of course, this is within the constraint we have of wanting

to have people, for example, E4s in an infantry battalion, living on the

post.

Mr. SIKES. It seems to me that there may be greater room for flexi-

bility in setting and administering this policy. The requirements for

unit cohesiveness, hard physical training, and a tendency to play

hard which often goes with it, and tight discipline which characterize

a successful troop unit, may require that enlisted personnel as well as a

large number of NCOs and officers reside on base. In this case we

clearly have to provide adequate quarters on base.

However, at installations where the majority of the personnel are

involved in administrative, headquarters, or technical training func-

tions, and where there is adequate off-base support, it may be prudent

to allow a large part of these personnel to live off base rather than

building new quarters on base.

Does the Army recognize that different missions may require differ-

ing approaches in programing bachelor quarters ? How is this reflected

in your programing?

General COOPER. As we have mentioned earlier, our present policy

requires bachelor personnel below the grade of 0-4 to live on post

where adequate quarters 'are available. For the majority of our troops

this is a sound approach. Our long-range program implements this

policy by planning quarters for these personnel. In our short-range

programing, for example in fiscal year 1974, we are still faced with

siaable bachelor housing deficits at nearly all of our installations

except some key divisional posts. The bulk of the troops at these divi-

sional posts belong to combat units and we have them live on post as

a military necessity. With the bachelor housing shortages at the other

installations we are not running the risk of overbuilding. In this con-

text, we recognize that there are different missions for our personnel

and these could lead to different 'approaches for programing living

accommodations. After we have further pared down the large out-

standing bachelor housing deficit these differing approaches will take

on more significance.

Mr. SIKEs. Last year the committee received the results of a survey

of several installations of each service. It indicated that many person-

nel preferred to live off base. Has the Army conducted any such survey

of its enlisted personnel?

General COOPER. Our surveys have shown that the primary sources of

dissatisfaction with barracks life are related to poor barracks design

and the lack of comfort amenities. Specifically, the lack of privacy, in

both sleeping areas and latrines; security of personal items; poor fur-

nishings; and, inadequate storage space are areas most often criti-

cized. Because of these dislikes and the associated poor living conditions

in existing inadequate barracks, some lower grade bachelor enlisted

personnel have indicated a desire to live off base. However, it follows

that given adequate troop housing on-base which eliminates these

avowed shortcomings, these same individuals would for the most part

probably desire on-base living accommodations. The Army's new bar-

racks design was developed to eliminate the noted shortcomings. The

new design represents a revolutionary change from the traditional open

bay living environment with community latrines to the 1, 2, or 3 man-

room with private bath concept. In order to obtain the soldiers' reaction

to this modern living arrangement, a group of enlisted personnel rep-

resenting a cross-section of ranks was provided the opportunity to in-

spect a real life mock-up of the new style quarters. Although the

group was small in numbers, their comments were very encouraging

and ranged from "I wish they'd had this 5 years ago," How about that!

Three men to a bathroom !", "Looks more like home !", "That's what I

like-the idea of being able to lock the door," "I love it," "It's real nice

to think that they're thinking of us," "I'll tell you, if we had a build-

ing like this nobody would want to live off-post," to "I definitely think

it's a step in the right direction-when a man comes home he leaves

his job behind." Only after the first increment of the new barracks be-

come available and are occupied can we evaluate the impact of ade-

quate troop housing on personnel retention in the volunteer force

environment. However, we think we are moving in the right direction.

Mr. McKAY. Just a clarification here. Is it your policy that down

the road all military personnel would be housed on bases?

General COOPER. No, sir. You said all military personnel.

Mr. MCKAY. If that time ever comes.

General COOPER. For married people, right now we are limited in

the criteria of what we can provide in family housing. We cannot

provide it for anybody below an E-4 and we can provide it for an

E-4 only if he has 4 years' service or 2 years' service and a commit-

ment for 6. So for family housing, we do surveys every year to de-

termine how much the community can support.

If the community can support the housing within what the Secre-

tary of Defense calls the maximum allowable housing costs, we do

not build family housing on the post.

Mr. McKAY. I gather from what you said there are certain groups

you want on base, because they are ready-combat or whatever, units

that necessarily need to be congregated in an alert situation for what-

ever purpose. But I gathered also from your indication that in the

long term you had hoped, as you caught up with your long-range

planning, that you would have more and more housing of all sorts

on the base until, if the ultimate was reached, you would have all

military personnel and families housed on or in close proximity at

least to the base.

General COOPER. Well, that is correct, when you say close prox-

imity-

Mr. McKAY. That opens the door to everything.

General COOPER [continuing]. You have to differentiate between the

family housing and the bachelor housing. We do not plan to build

bachelor housing-and this is not really significant because there are

not too many-for majors and above.

We do plan to build bachelor housing for everybody below the rank

of major, but the bachelor housing for the higher grade enlisted

men is on the lower end of the priority.

SAFEGUARD

Mr. SIKES. Before I get into other aspects of the fiscal 1974 re-

quest, we have General Leber with us and I am going to take up

that portion of the questions which deals with Safeguard so that we

will not tie you up longer than necessary.

General Leber, do you have a statement on the overall situation

of the Safeguard program ?

General LEBER. Only that we are not asking for any authorization

or appropriation in fiscal year 1974 for either Safeguard or site defense.

Mr. SIKEs. What Safeguard funds remain unobligated and un-

expended ? What plans does the Army have for their use during fiscal

1974 ?

General LEBER. The current Safeguard MCA program totals $646.8

appropriated during fiscal years 1968 through 1972, of which $114.5

million remains unobligated and $206.9 million remains unexpended

as of 28 February 1973. Of the unobligated amount, $64.8 million is

committed against completion of the Safeguard deployment, prin-

cipally for Grand Forks, but also including termination of the Malm-

strom, Warren, and Whiteman sites in accordance with the treaty

limitations supporting construction elsewhere and community im-

pacted assistance. The remaining unobligated amount, which is $49.7

million, has been reserved for dismantling and restoration of the

Malmstrom site and to meet other contingencies in the overall program.

The site defense MCA program consists of a total of $20.4 million

appropriated in fiscal 1973, to design and construct R. & D. facilities

at Kwajalein Missile Range in support of the site defense prototype

demonstration program. Design is now well under way and construc-

tion is scheduled to begin during the first quarter of fiscal 1974.

I will put in the record the information you asked for.

20-192 (Pt. 1) 0 - 73 -- 13

192

SAFEGUARD OBLIGATION RATE

Mr. SIKEs. I would like to have a complete breakdown for the record

showing the status of obligations, current and projected, for Safeguard

and site defense, breaking out the costs related to Safeguard and those

related to site defense, also details for the record on planning funds

for Safeguard and site defense.

[The information follows:]

The Safeguard MCA program includes $91.6 million in planning funds appropri-

ated during fiscal year 1968-72. Of this amount, $78.0 million had been obligated

as of February 28, 1973. Of the remaining $13.6 million, $2.8 million is committed

during the remainder of fiscal year 1973 and in fiscal year 1974 for completion

of the deployment; and $10.8 million is included in the reserve established for

dismantling/restoration of the Malmstrom site.

The site defense program includes $1.4 million in planning funds appropriated

in fiscal year 1973 in support of R. & D. construction at Kwajalein Missile Range,

of which $0.3 million had been obligated as of February 28, 1973. Additional

obligation of $0.8 million is anticipated by end fiscal year 1973, with the remain-

ing $0.3 million to be obligated during fiscal year 1974.

A tabulation portraying the overall Safeguard and site defense funding pic-

ture by site or purpose, including actual obligations as of February 28, 1973,

and projected obligations through fiscal year 1975, is presented in the following

chart.

SAFEGUARD AND SITE DEFENSE MCA OBLIGATION SUMMARY

[In millions of dollars]

Fiscal year-

Actual

as of 4th Ist 2d 3d 4th

Feb. 28, March quarter quarter quarter quarter quarter

Site/purpose 1973 1973 1973 1974 1974 1974 1974 1975 Total

Safeguard:

Grand Forks-------........ 269.2 2.6 9.6 6.2 5.4 0.4 0.3 0.5 294.2

Malmstrom------............. ------139.9 2.4 .4 .5 ----------...............------------------......... .. 143.2

Whiteman............ -------------5.8 ........ --2.4 .................-----------.................-------------------------......... 3.4

Warren- -......... .6 .4 ...............-------------------------.....---------............................---------.. 1.0

Central training facility.. 6.8 .1 .1 .1 .4 ......................----------------------- 7.5

Mission depots........ ---------3.8 .1 2.4 ...................................------------------------------------- 6.3

R. & D. support at Kwaj-

alein .......---------------... 22.3 .4 .5 .5 1.1 -----------------.........------....... 24.8

Standard and miscella-

neous design and engi-

neering and design in

support of construction- 58.8 3.6 5.5 3.6 3.5 3.4 2.6 1.7 82.7

Community impact as-

sistance.......-------------- 8.1 1.8 1.0 1.0 1.0 1.0 1.0 2.1 17.0

Sentinel effort not appli-

cable to Safeguard_ . 17.0 .........................--------------------------------------------------.. 17.0

Safeguard total....... 532.3 11.4 17.1 11.9 11.4 4.8 3.9 4.3 597.1

Safeguard reserve........----------------------------------------------------------------49.7

Total Safeguard pro.

gram............------------------------------------------------------------------ 646.8

Site defense: R. & D. Support

at Kwajalein ....-------------- .3 ......... .8 3.8 .2 6.2 .1 9.0 20.4

Mr. SIKES. The table provided to the committee's staff indicates

that you plan to obligate some $13.1 million for standard and miscel-

laneous design. and engineering and design in support of construction,

during fiscal year 1974. Can this amount be justified, this amount of

planning, in view of the fact that construction at Grand Forks'is

very nearly complete, and the site defense construction program st

Kwajalein totals only $20.4 million?

This seems to be a very large amount of planning.

General LEBER. Well, sir; the title you have here is standard design

and miscellaneous design and engineering and design in support of

construction. The $13.1 million is programed in support of Safeguard

only. It consists of construction funds intended primarily for the

development of a contractor maintenance data system for maintenance

of the tactical support equipment, the utilities and so on that have

been installed at Grand Forks; also, for shock testing of installed

equipment and for electromagnetic pulse testing.

Now this contractor maintenance data system will provide the

necessary documentation to facilitate rapid maintenance, repair and

replacement of key components of MCA tactical support equipment,

such as the generators, the air-conditioning, and the purified water

system.

This is absolutely essential in this system, which has to be oper-

ated 24 hours a day, 365 days a year. Shock testing of equipment,

identical to that installed at the Grand Forks site, is being accom-

plished at a number of Government and contractor installations to

verify that the equipment meets design requirements.

We are also carrying on the electromagnetic pulse testing of the

equipment to verify that it will stand up under the conditions that

are contemplated.

Mr. SIKES. IS it proposed to transfer any funds from Safeguard to

site defense?

General LEBER. No, sir.

SAFEGUARD TERMINATION COSTS AND CLAIMS

Mr. SIKES. What reserves are you holding for contract termination

costs and for claims?

General LEBER. We are not holding a reserve as such for contract ter-

mination at the Malmstrom, Warren, and Whiteman site.

We have identified in the program amounts totaling $147.6 million

for the three sites and we think that this total amount will cover the

termination costs. There may be some slight variation between the

three, but we think the total of $147.6 million is adequate.

Now, virtually all of that money has been obligated and we are

now in the process of auditing the contracts that were awarded and

then terminated to determine the final termination cost, and we expect

to have that answer by this September.

We are holding, as I say, no reserve for that purpose. We do have

an overall reserve which I mentioned, of $49.7 million, which is to

cover restoration and dismantling of the Malmstrom site and any

other contingencies in the overall program.

Mr. SIKES. Do I recall that in hearings before the Defense Subcom-

mittee you indicated that about $10 million was being reserved for

claims?

General LEBER. Well, sir, that $10 million is an approximate figure

in the reserve for claims on the whole program, not just the termina-

tion.

Mr. SIKEs. All right.

Do you think that your reserves are sufficient or more than sufficient

to cover these costs ?

General LEBER. Sir, I believe the reserve is sufficient. The reserve is

roughly $50 million.

REPROGRAMING OF SAFEGUARD FUNDS FOR NATO INFRASTRUCTURE

Mr. SIKES. The committee has just received a reprograming request

which utilized $20.650 million of prior year Safeguard funds for

application to the NATO infrastructure program.

How does this fit into your Safeguard funding ?

General LEBER. Sir, the Office of the Secretary of Defense has

decided that in view of this requirement for funds to support the

NATO infrastructure, that they would reduce the $50 million reserve

by the amount you have cited, and ask the committee's approval to

reprogram it for this other purpose.

Mr. SINES. Does that mean the $20 million plus would come out of

your $49 million reserve ?

General LEBER. Yes.

Mr. SINES. If the committee approves it ?

General LEBER. Yes.

Mr. SINES. What are your recommendations ?

General LEBER. My recommendation to you is the same as I made

to the Office of Secretary of Defense. If, in your judgment, you feel

we will not need all of the $50 million to close out the Malmstrom

site and restore it as we will be required to do under the treaty, and

to cover contingencies, then go ahead with this reprograming.

Mr. SINES. What is your personal thinking on the matter?

General LEBER. Well, my own feeling is that we should be able to

close out that site at less than the total reserve.

Now let me explain that a little further.

SAFEGUARD SITE RESTORATION COSTS

We have outlined a whole spectrum of plans for closing out the

site. The cheapest plan would cost about $1.5 million. Now this would

be nothing more than simply grading off, cutting out any safety haz-

ards and walking away from it, leaving portions of the uncompleted

construction there. You can go all the way from that inexpensive

plan up to a plan where you tear out all the reinforced concrete that

you put in out there. If you undertake that, it is going to cost perhaps

$30 to $40 million.

In my view, that does not make sense. I would recommend against

it. I have recommended against it. But it is not up to me to decide.

This will be a matter decided between the United States and the

Soviets as part of the ABM Treaty provisions.

My strong recommendation, though, is do not send the taxpayers'

money to rip out all of that reinforced concrete. There is no point in

it, absolutely no point.

SAFEGUARD CLAIMS

Mr. SINES. Is it correct that $10 million should be sufficient to cover

all claims?

General LEBER. I believe it should, yes.

Mr. SIRES. How much are you reserving for demolition at the other

Safeguard sites in accordance with the SALT agreement?

General LEBER. None, sir; there is no requirement for demolition at

sites other than Malmstrom.

Mr. SIKES. So there would be no demolition unless you are ordered

to proceed with that ?

General LEBER. That is correct.

Mr. SIKES. I think this committee would support you.

Would you discuss the situation which has arisen, the current situ-

ation on claims for the Grand Forks Safeguard construction ?

General LEBER. Yes, sir.

The Department of Army, through the Corps of Engineers, awarded

a firm fixed contract to the Morrison-Knudsen joint venture on April

1, 1970 for $138 million for construction of the Grand Forks site. Since

that contract was awarded, there have been changes in the drawings

and specifications and these have been passed to the construction con-

tractor. These have been handled in the normal way as change orders.

To date the Government has settled for $6.6 million, 142 of the change

orders, for which the contractor claimed $16.3 million. So we settled at

about 30 percent.

We now have before us some 284 outstanding change orders for

which the contractor has claimed $113 million. I fully expect that we

will settle at some figure less than $113 million. I cannot tell you today

what it will be, because the corps has not gone that far in the

negotiations.

But I have no hesitation in telling you that we will settle for less

than $113 million.

Mr. SIXEs. What amount is the contractor claiming?

General LEBER. The $113 million is the outstanding amount.

Mr. SIxES. Can he support such a large claim ?

General LEBER. I do not believe he can, no, sir.

Mr. SIKEs. If the Army had to do it over again, would you rec-

ommend a negotiated contract at Grand Forks so as to obtain the

contractor's cost estimates as a basis for later claims due to change

orders?

General LEBER. Well, sir, you know hindsight is a great thing.

We have tried to look at it, look back. In my own view, in construc-

tion we are best to stay with the firm fixed price contract, even though

we know that there will be charges ahead of us. In the end I think

the Government and the taxpayer will come out ahead, for this main

reason: When you award a firm fixed contract, you place on the con-

tractor the onus of management. If we ever go to the cost-plus-fixed-

fee, the onus is on the Government, the contractor has no incentive

to run and manage a good job.

Mr. SI(ES. When do you expect the claims problem to be settled ?

General LEBER. The corps is working on that now, giving it first

priority.

I would think by the end of this calendar year we should be well

along with it.

Mr. SIRES. It is customary procedure in this subcommittee to go

to the ranking minority member for questions, then back to the major-

ity side.

On Safeguard, Mr. Davis, do you have any questions, so we can

excuse General Leber?

Mr. DAVIs. No, I have no questions.

Mr. SIRES. Mr. Talcott ?

Mr. TALCOTTr. With regard to the fixed-price contract or the cost-

plus, how about quality? You talked about management.

General LEBER. Under our system with the plans and specifications

and in the inspection, we insure that the quality is there.

Let me just say in behalf of this contractor who has been some-

what maligned in this case, he has done a fine job at Grand Forks.

The quality is good, it had to be good. We saw that it was.

Mr. TALCOrr. I have no further questions about Safeguard, but

he is an expert on Panama and we have a pretty big item in here

on Panama.

Mr. SIKES. Go right ahead.

General LEBER. I remember I answered some questions last year on

the road down there.

Mr. TALCOTT. I will not ask any questions now.

Mr. SIKES. Mr. McEwen?

Mr. McEWEN. No questions.

Mr. SIKES. Thank you, General. We are always glad to have an

opportunity to discuss this important subject with you.

NATIONAL CAPITAL SITE

One additional question: Do you plan to use any funds that are

available for Safeguard for the National Canital site?

General LEBER. Sir, none that are available, no. We are asking

in the fiscal 1974 R.D.T. & E. account under site defense for authority

and appropriation totaling $5 million for planning of a possible

defense of Washington by adapting the site defense system to be

used here. But we are proposing no use of MCA funds, no, sir.

Mr. SIKES. Does that require authorization ?

General LEBER. Yes, sir, it does.

Mr. SIKES. Thank you very much General Leber.

FISCAL YEAR 1974 REQUEST

Mr. SIKES. Turn back to the fiscal 1974 request.

ARMY'S BARRACKS PROGRAM

Has the fiscal 1974 request for barracks been carefully screened

to eliminate those installations at which reliance upon suitable com-

munity support is feasible ?

Mr. BRAZIER. Yes, sir, it has been screened.

Mr. SIKES. Discuss the type of barracks facility which the Army

plans to provide in the fiscal 1974 program.

I am impressed by the new Army barracks design.

Provide a short discussion, for the record, of the essential features

of the new design, and any major changes or improvements that you

feel it includes.

Mr. BRAZIER. We will provide this.

[The information follows:]

Mr. BRAZIER. In consonance with the need to provide the volunteer soldier

with an appropriate living environment, the Army directed the development

of an entirely new concept of bachelor enlisted housing. The principal emphasis

197

of this concept is privacy for the individual. The Corps of Engineers, through

an architectural design competition, developed two designs embodying the

improved criteria for standard, nontrainee, housing of 300-man capacity or

greater.

Both designs provide, within statutory fund limitations, the following:

a. A separate living area for each man. These areas are combined to form a

private three-man room with an attached three-fixture bath.

b. Flexibility to assign either three E2-E4's, two E5-E6's or one E7-E9 to

this room as personnel load requirements dictate.

c. The separate living spaces provide each man with a bed, desk, and chair,

secure wardrobe and an operable window.

d. Each three-man room provides its occupants with TV and telephone outlets

and an individual room thermostatic control.

e. Coordinated interior design is provided throughout.

f. A small lounge is provided for no less than four nor more than eight rooms

with individual access to maintain unit integrity. This lounge accommodates

TV watching, reading, writing, limited socializing, quiet music playing and

other activities of a relaxed nature.

g. A service module is provided for every 165 men. It contains some central

storage, control desk, lobby, laundry facilities, vending machines, mail lock-

boxes for each man, public restroom facilities, and areas for activities of a

loud or active nature.

h. Separate buildings are provided for unit orderly and supply buildings.

In addition to their historical function, this building now provides each soldier,

housed in the barracks, in family housing and off-post, with individual storage

and maintenance facilities for issued field equipment.

The major improvements this design provide are increased living area, privacy

for the soldier and a separation of his work and living areas to achieve an

improved living environment.

Mr. SIKES. I would like to have for the record the status of the

Army's fiscal year 1973 barracks program.

[The information follows:]

The status of contract awards as of April 20, 1973, for the fiscal year 1973

barracks program is as follows:

New Barracks.-Eighteen projects totaling $118.729 mililon were approved. Ten

projects totaling $76,309 (64.3 percent) have been awarded and include the

following :

Thousands

Fort Carson-------------------------------------------------- $12. 920

Fitzsimons Hospital-----------------------------------------------. 685

Fort Ben Harrison ________________________________ 0. 878

Fort Gordon-----------------------------------------------------2. 803

Fort Jackson -----------------------------------------------------16. 810

Fort Hood------------------------------------------------------25. 486

Fort Sill----------------- --- 10. 403

Fort Polk--------------------------------------------------------4. 997

Location 178--- ___________________ 0.505

Locatin 178---------------------------------------------_---055

Kwajalein ------------------------------------------------------- 0. 822

Three projects totaling $18.559 million (Belvoir, Ord, and Vint Hill Farms)

were advertised but could not be awarded because of high bids. These projects

are now being reviewed and design adjustments made to reduce costs to enable

awards within programed amounts when they are readvertised.

Projects not yet awarded total $23.861 million and include:

Thousands

Fort Lee -------------------------------------------------_______ $0. 245

Fort Myer______________ -------------------------------------------------------1. 815

Walter Reed Hospital ________________________________ 8. 923

Fort Knox__ ------------------------------------------------------12. 160

Sierra AD_-------------------------------------------------------0. 699

Barracks modernization projects.-Thirty-five projects totaling $110.2 million

were approved. Fourteen projects totaling $34.4 million (31.2 percent) have been

awarded.

IDollar amounts in millions]

Award

Summary Program Amount Percent

New barracks------........................................-----------------------------------.. $118.7 $76.3 64.3

Barracks modernization ... .. _-_------_--- --. - - 110. 2 34. 4 31.2

Approximately 90 percent of fiscal year 1973 bachelor housing projects are

scheduled for award before the end of fiscal year 1973.

BARRACKS COST PER MAN

Mr. SIKES. Can you tell us how much the cost to provide adequate

barracks and associated facilities for one enlisted man has increased in

the past 5 years?

Mr. BRAZIER. Sir, as we see if at the present time, the cost to support

one enlisted man has approximately doubled in that period. It has

gone up anywhere from $4,000 to $5,000 per man.

At the same time the barracks itself has increased in cost from $2,750

per man in fiscal year 1970 to about $4,760 per man in fiscal year 1974.

Mr. SIKES. How much of that is, shall we say, modernization in the

sense of providing more adequate facilities, more space ? How much is

the cost actually based on that consideration, primarily, rather than on

inflation?

Mr. BRAZIER. It is both, sir. We have increased the amount of space

overall that we are providing.

Of course, in the period of the last 4 or 5 years we have had a con-

siderable increase in escalation which has to be reflected also.

Mr. SIRES. Provide details for the record.

[The information follows:]

During the period April 1970 to April 1974 improved standards will have

increased the barracks area per man by approximately 32 percent. Construction

cost escalation during the same period is approximately 42 percent. The total

increase in cost to provide one barracks space, reflecting both increased standards

and cost escalation is approximately 73 percent.

BARRACKS STANDARDS

Mr. SIKES. What changes in legislative limits, if any, are required

to provide the type of bachelor quarters you are proposing in fiscal

1974?

Mr. BRAZIER. Sir, we have a requirement for congressional approval

of $30.50 per square foot for bachelor officers quarters. That is up $1.50

from previously. And $28.50 per square foot for barracks. That also

is a rise of $1.50.

These unit costs are based on military bid experience and building

costs with cost growth projection for the fiscal year 1974.

Mr. SIRES. Tell us how much you are expanding the amount of space

per man by such means as separating his equipment storage from his

living space?

Mr. BRAZIER. Sir, we are expanding our company administration

and storage facilities, to provide 2.25 square feet per man for each

soldier's field equipment. This is not in the new barracks, but in

separate buildings. It is intended that a soldier living in the barracks

will keep only his uniforms, other clothing and personal belongings

in his quarters. In other words, we are separating out his gear.

Mr. SIKES. In the old days you wanted his equipment close to him,

including his weapon. You think we have outgrown that stage, it is

not necessary, in this modern world to have his weapon where he can

get to it in a hurry?

Mr. BRAZIER. Well, sir, we have other influences on some of our

decisions; but yes, sir, we think this is a more effective way to run

the Army.

General COOPER. It will be immediately adjacent, not where he can

reach over and pick it up. He will go by the supply room on his way

to the truck to pick it up.

Mr. SIKES. Will you have ammunition there, too?

General COOPER. That is stored separately. You are well aware of

the desire to keep good control over weapons. That is part of it. Also,

it is easier to keep it there.

Mr. SIKEs. There have been situations where men were sent out

without ammunition to face dangerous situations in our own country.

I wonder if the weapon and the ammunition were in reasonable prox-

imity under the new system.

General COOPER. They are in reasonable proximity, but sometimes

in the case of riots they deliberately do not give the men ammunition

because of the fear or the danger they would cause. If that is the

case, you might as well not give them the weapon.

Mr. SIKEs. Why give them the weapon if you are not going to give

them the ammunition to go with it ?

I think it is a mistake in policy, but that is one man's opinion.

FUNDING REDUCTIONS

Mr. DAVIS. You have indicated $42 million has been applied to ob-

ligational authority requested in 1974 to reduce the new budget au-

thority required from the Congress.

First of all, you mentioned $20 million with respect to NATO

recoupments. Is that still your best estimate with respect to that ?

General COOPER. The estimate of $20 million in recoupments for

fiscal 1974 was made in the fall of 1972. At that time we anticipated

a total of $44 million would be recouped; $24 million in fiscal year

1973, and $20 million in fiscal year 1974.

Most of these recoupments do come from programs which we have

funded in anticipation, or we felt we needed and later on it was

authorized by NATO to be covered under infrastructures.

When you do that and it later comes into the category, you get

the money back. Our estimate now is that for fiscal year 1973 and

1974 we estimated originally we would get $44 million, and now our

current estimate is that we will get for those 2 fiscal years $50 million.

Mr. DAVIs. Does that indicate, then, that we will have an offset here

of about $6 million that will not be needed in terms of new obliga-

tional authority?

General COOPER. That is correct, sir.

Mr. DAVIS. You mentioned there was a $22 million item in savings

in prior year programs. Is that still a good estimate?

If so, what are the sources of that $22 million ?

200

General COOPER. The source of that $22 million was a surplus as of

June 30 of about $5 million and we recouped about $17 million from

Southeast Asia. As you go through the pluses and minuses since we

made that estimate, we now figure there will be about $2.8 million

short. In other words, we will not be able to meet the $22 million; it will

be closer to $19.2 million. But there will be some other changes as we go

along.

I can provide the details as to how we arrived at that number for

the record.

[Information follows:]

Status of MCA funds

Million

Surplus June 30, 1972--------------------------------------------- $5, 089

Recouped from SEA-------------------------------------- -------- 17,100

Cancelled :

Loc 263--Operations building---------------------------- ----- 111

Loc 266-Operations building---------------------------------- 95

AUTOVON switch (Germany) ---------------------------------- 519

Anniston waste treatment------------------------------------- 915

Meade sedimentation lagoon---------------------------------- 257

Awards since June 30:

Fiscal year 1973 program savings--------- , ----------------------8,500

Fiscal year 1972 and prior overrun-------------------------- --2,299

Reprograming for medical planning------------------------------- -4,200

Reprograming for Korea ALOC------------------------------------ -1,204

Reprograming for three unfunded projects in Germany fiscal year 1973

program --------------------------------------------------- --3,674

Applied to fiscal year 1974------------------------------------ --22, 000

Present indicated deficit based on awards to date----------- ---- -2, 791

Mr. DAVIS. For the record, in order that we can have a little better

comparative breakdown, as you have gone along in the current fiscal

year, from time to time there have been reprogramings that have

occurred, which would tend to throw off actual figures for 1973 as

against projections for 1974, unless those reprogramings are taken

into account.

Would you provide us with a tabulation of the reprogramings that

have occurred in this fiscal year ?

General COOPER. Yes, sir.

[The information follows:]

Reprogramings approved during fiscal year 1973:

(a) Planning and design of improvements to hospital and medical facilities--

$4,200,000.

(b) Construction of Air Line of Communications (ALOC) Airfields in Korea-

$1,204,000.

(c) Reconstruction and repair of facilities in the I. G. Farben Building, Ger-

many which were damaged by a bomb explosion-$872,000.

The Appropriations Committees have also been requested to approve repro-

graming of $20,650,000 required to offset the dollar devaluation impact on NATO

Infrastructure commitments.

SINGLE MISSION POSTS

Mr. DAVIS. Let me get into the general question with respect to

construction at small single mission bases, Carlisle Barracks, Fort

Monroe, Fort McPherson, Fort Greely, and so on. These estimates are,

I assume, based on the assumption that these rather isolated installa-

tions will continue to be utilized for the foreseeable future; is that 1

about correct?

General COOPER. We are restudying all of our bases, not just the

small ones.

Mr. SIKES. May I ask a question ?

I am puzzled by the fact that you say you are restudying utiliza-

tion of bases. We have just gone through a base closure, a rather

significant base closure action, which I would have assumed had

already included all of the studies that would be necessitated for a

number of years. Apparently that is not true for the Army, you still

are not decided on the future use of some of these installations.

General COOPER. The major thrust of the study that was done this

past calendar year was really in the reorganization of the Army, in

which we ended up with eliminating CONARC, reducing the size of

the continental armies and establishing the Training and Doctrine

Command and the Forces Command. That was the major part of that

study and the major effort. We did not exert a comparable effort in

examining in detail each of these individual bases. We did have some

base closures and realinements such as Fort Wolters and Hunter Army

Air Field that came out fairly naturally. But we have not looked, on

the long-term basis, at whether Fort Monroe is the best place to locate

TRADOC. When we reorganized, we did not want to disrupt that re-

organization by moving the people to some new base at the same time.

Mr. SIKES. When do you contemplate that the Army will have firm

recommendations on the utilization of bases such as those that have

been mentioned ?

General COOPER. By the end of this calendar year.

Mr. SIKES. You think the Army will be in a position to recommend

by the end of this calendar year, a more firm base structure than you

have now?

General COOPER. I think we are, primarily, going to look at the whole

thing again. We studied the installations in detail several years ago

in the Boatwright study. I would differentiate among some of the

small bases Mr. Davis mentioned.

There were some, even prior to doing the study, we are quite con-

vinced are going to stay there. But some of them like Monroe, looking

to the long term, we will decide on by the end of this year.

As we do the study, we will pick off information prior to the end

of the year to be sure that the 1975 budget submission does not include

any items that we think will fall out because of the base closure.

Mr. TALCOTTr. Has the Army reorganization plan been approved

by the appropriate authorities or is that going to be changed ?

General COOPER. No, the reorganization was approved by the appro-

priate authorities and the announcement was made January 11, 1973.

Mr. TALcoTr. Is that secure ?

There is no review of that ?

General COOPER. There is no review of that that I know of.

Mr. TALCOT. So the base closures and consolidation and changes

are being adapted to the major reorganization of the Army ?

General COOPER. That is correct, sir.

Mr. TALcoTT. Could we have a summary of the reorganization plan

put in our record ? It appears that is going to relate to the base closures

and all.

General COOPER. Yes, sir.

Mr. DAVIS. I think we all are concerned, General, with respect to

some of the bases, the future of which appears to be uncertain, that

we are not proceeding with long-term construction projects only to

discover that a decision is made that we will not go ahead with those

projects, or that we will go ahead with some of them and then find

that the base is going to be closed or changed in its application in

such a way that it looks as if we really did not know what we were

doing by going ahead and funding these things.

That is the thing we would like to have you address yourself to, with

respect to some of these smaller single mission bases, in particular,

and I am sure the chairman will want to get into the overall program

of base utilization or base closures of which we have been informed.

General COOPER. We are equally concerned we do not spend money

at bases about to be closed. It not only makes the committee who might

have authorized or appropriated the funds look bad, it makes us look

even worse, because we are the ones who make the presentation. So

we would agree with you in principle.

When we worked up the 1974 budget we tried to eliminate construc-

tion projects where we thought the base itself might be in doubt, for

the long range. Since the time the budget was originally prepared,

there are a few others, not very many, which we think fall in that

same category.

You can be assured that we would not proceed with the construction

of any of those, assuming you appropriated the funds for them, until

that study is complete on any of those particular bases.

I would like to emphasize that is a small number, not a major portion

of our request.

Mr. DAVIS. I think a practical way to handle this, Mr. Chairman,

might be if we did have the Secretary and the general provide our

clerk here, Mr. Nicholas, with a list of those installations where there

still is considerable doubt as to their future beyond, let's say, fiscal

1974. Then we should be in a position to check back with them as to

the latest available information that you get from higher sources,

decisionmaking sources, prior to the time that we do attempt to mark

up this bill.

Mr. SIKES. Are you in position to do this?

General COOPER. Yes, sir.

Mr. SIKES. All right.

General COOPER. We do not want to prejudge our study. We are

certainly in a position to do that and will do it.

Mr. SIKES. Very well.

Now would it not be more realistic for the committee to defer action

on funding requests for the small bases until you have actually decided

on their future ?

General COOPER. We would prefer that you not defer action since

to do so, would prejudge the outcome of the study.

Again I would differentiate among the bases. I think on an indi-

vidual case-by-case basis as we go through the program, we could

indicate to you those where, again referring to the small bases, we

think there is a 100-percent chance that they will be in the long-term

basis, those where we think there will be a 50-percent chance or those

where we think there will be a 25-percent chance.

Mr. SIKES. The committee wants to work with the Army on this

matter, but we do not want to fund projects at bases that are not

going to be used, and I am sure you do not want us to do that.

So let's maintain close contact. You keep us advised as well as you

can as to the progress of your studies; give us the best advice that you

can on the bases that are most likely to remain in the program.

General COOPER. Yes, sir.

Mr. TALCOTr. Mr. Chairman, may I just express another concern

that I have?

Mr. SIKES. Of course.

IMPORTANCE OF MISSION EFFECTIVENESS

Mr. TALCOTr. I am fearful in this, as in other base closings and con-

solidations, sometimes we are going to force an important facility

into an unused but inadequate base.

I can remember the time when they put the Defense Language In-

stitute teaching facility in El Paso simply because we had an empty

hangar or warehouse down there. It was not the appropriate place

to put a defense language teaching facility in my judgment as well

as many expert and distinguished language teachers.

With all these base closures, I have the feeling that you are going

to see an empty barracks here or there and you are going to force an

activity into that barracks, regardless of the long range detriment to

the mission. I think we ought to be caring first and foremost about

the mission that is going to be performed.

An infantry training base up in Minnesota I would think would

be-I will change that, New York or Washington or some place-

all I am trying to say is, without offending too many people, that we

have to make sure we have the training facility in the kind of installa-

tion appropriate to it.

This worries me, that we have so much juggling to do that some of

the juggling is just going to be putting a facility in an empty barracks

or an empty hangar and in the long range it is going to be inadequate,

inconvenient, and inefficient. It is going to cost more money in the

future, we are not going to adequately support our mission and we are

going to make it a less pleasant place for the military service people

to work and live.

I think this attitude is prevalent right now.

General COOPER. We specifically consider, among the criteria, mis-

sion as being the first and foremost criterion. But you also have to

consider, if there are large permanent facilities available someplace,

how much is it worth in terms of degradation of your mission accom-

plishment to use those existing facilities.

That is what you have to do in considering all of this. We agree

with you.

Mr. TALCOTT. I would like to know a little bit more about how you

do it; how much degradation is there? What is the cost-effectiveness

in each situation ?

We have to be involved in that decisionmaking process, too.

General COOPER. We can certainly go over with you the criteria used

in the decisionmaking. You recognize some of this is not easy to

quantify. It is easy to quantify the cost of existing facilities, but not,

for example, how much poorer the teaching facility is at El Paso

than at Monterery.

Mr. TALCOTT. Monterey or Washington, D.C.

Sometimes we, including you in the Army, have to be more sensitive

to the individual personal needs of the soldier than we have been in

the past.

A few years ago this committee suggested that you consult with

wives when you were talking about family housing. You were not

doing it then. You finally did it. Your family housing is much better

now.

I agree with the chairman, your housing for enlisted people is a lot

better. But you still refer to it as barracks and you still refer to it as

family housing and family housing is pretty close to warehousing and

barracks.

I just looked up in the dictionary what it says about barracks: A

plain and large building such as a row of houses joined together or a

barnlike structure.

You still continue to do these-kinds of things in the service. In my

judgment, you simply ought to be changing and be more sensitive to

the individual needs.

In your testimony today, you said, as the core of this year's program,

we are continuing to emphasize facilities which benefit the soldier

where he lives, where he plays and where we treat him when he is

sick. We ought to include where he works. That ought to be very im-

portant, also.

Then where his family lives, where his family plays, and where

his family is treated when they are sick, not just him.

In other words, I think you need to try to develop a broader sensi-

tivity to what you are trying to do. It is not simply barracks any more,

it is not warehousing, it is not the soldier himself; it is the total con-

cept.

I believe all the way through the system that you lack a sensitivity.

I am not trying to be mean or ornery with you. I am suggesting when

we develop these programs that we remember that all of these things

are important.

Degradation is hard to quantify, but it is more important to the

soldier, to the family, and the kind of a military force we are going

to have than just looking down at a topographical map and saying,

there is an empty hangar and we are going to force some activity into

it. That is the way I feel about it. And that is the way the servicemen

and their families in the service feel about it.

We on this side of the table have to reflect this sensitivity. You have

to win the wars. But we have to make sure that the individual and the

service family are considered.

General CooPER. I think we have to reflect that sensitivity or we will

not get the mission accomplishment out of the soldier ourselves.

I think we have done that in terms of the barracks, in spite of your

not liking the term. The new barracks

Mr. T.\LCOrr. If you like that term, you can have it. *

General COOPER. Well, we have to be careful we are not accused/of

using euphemisms. I agree with you it does not fit the dictionary

definition. These new barracks are very nice, they have carpetingon

the floor.

I will agree with you, there are some oldtimers who say you are

pampering the young troops. But the Army is firmly committed to

giving these troops privacy, giving them a private bathroom for every

three men of the lowest grade level. That is a conscious decision, that

is where most of our funds are going.

We have not yet solved the family housing problem. I do not want

to mislead you that we have solved the family housing problem.

We have turned around in terms of trying to build to quality versus

quantity; we design it so we have the quality features. But we are

not yet n a position today where we are building what we consider

today quality family housing.

Mr. SIKES. You certainly have progressed a long way from open

barracks to rooms with private baths for two men. That is a very

fine improvement.

I agree with what both of you have said about the subject.

Off the record.

[Discussion off the record.]

Mr. SIKES. Mr. McEwen. do you have any questions at this point ?

COST OF CONSTRUCTION OVERSEAS

Mr. McEWEN. Just one, I believe, Mr. Chairman.

General, you or the Secretary spoke on square-foot costs for barracks

and bachelor officer quarters. Ilow much does that differ overseas

from the United States, for instance in Europe.?

General COOPER. The cost?

Mr. MCEWEN. The cost per square foot.

General COOPER. We are not building anything overseas now, so we

do not have any directly comparable costs.

Mr. MCEWEN. I thought you spoke about schools that you wanted,

for instance.

General COOPER. Yes.

The cost factor in Germany, I do not know what it is now with the

devaluation.

Mr. McEWEN. Has that been taken into consideration, the devalua-

tion, in your figures ?

General COOPER. No, sir, not in the 1974 program.

The most recent one was not. The prior one was.

Mr. MCEWEN. Would that not be fairly substantial?

General COOPER. Well, it is going to be about an 11.1 percent increase.

Mr. McEWEN. That is not in these figures ?

General COOPER. That is not in the $12 million that we asked for in

Germany.

Mr. McEwEN. Are construction costs higher in Germany or lower

than in this country ?

General COOPER. That is the cost index, which I do not have right

now. I would say that with the latest devaluation, the costs are probably

higher in Germany than they are in Washington.

We use Washington as a geographical cost index of 1.0. The area

adjustment factor for Germany is 1.20. This factor has not been re-

!vised since the dollar devaluation.

Mr. SIKEs. But you not only have the devaluation, but inflation is

Higher in most countries than it is in the United States?

General COOPER. Inflation, is greater, that is correct.

Mr. TALCOTT. But the requirements are different in every country,

too? You have to go to a different kind of school in Germany than you

do in Hawaii or Japan or Guam ?

General COOPER. That is right, sir.

Mr. SIKES. Last year we had quite a discussion on the number of

chairs in 'a room. We found you were planning to put one chair in

a room for four men, at that time. How many chairs are you provid-

ing now ?

General COOPER. In these new barracks they will each have a chair.

There also will be a sitting room cluster around these four, three-man

rooms. They will each have their own chair, sir.

Mr. SIKES. That is encouraging.

General COOPER. General Kjellstrom last year went off the record to

say something about this.

Mr. SIKES. General Kjellstrom, do you have an observation?

IMPACT OF CURRENCY REVALUATION

General KJELLSTROM. I wanted to come back to the increase due to

currency revaluation and its impact on the Army's budget. Withhl

the MCA appropriation, up through the 27th of April, there was a

$9.6 million increase in the overseas construction requirements, and

that is basically in the European area.

Within the Army overall, there is $103 million impact of the cur-

rency revaluation since the President's budget came down. Of partic-

ular concern to us is in family housing.

As you know, in the normal appropriations we have the authority to

reprogram or transfer between appropriations to meet unforeseen re-

quirements. In the family housing area, we have been forced to make

adjustments within the family housing account.

For 1973 we have been forced to adjust our family housing O. & M.

account by $6 million. This is primarily in Germany. Within a tight

family housing account, it makes for real problems. We are anticipat-

ing we will have an $11 million impact at the present time in family

housing.

I would respectfully submit that we might consider some type of

flexibility in the family housing account, particularly for th-se un-

foreseen adjustments.

Mr. SIKES. The committee would like to have your recommendations

spelled out on that.

General KJELLSTROM. Be very happy to, for the record, sir.

[The information follows:]

The desired flexibility in the Family Housing Account could be achieved by

amending Section 735 of the DOD Appropriation Act by adding the words under-

lined below :

"Sec. 735. During the current fiscal year upon determination by the Secretary

of Defense that such action is necessary in the national interest, he may, with the

approval of the Office of Management and Budget, transfer not to exceed $750

million of the appropriations or funds available to the Department of Defense for

military functions or family housing (except mililtary construction) between

such appropriations or funds or any subdivision thereof, to be merged with and

to be available for the same purposes, and for the same time period, as the ap

propriation or fund to which transferred: Provided, That the Secretary of De-

fense shall notify the Congress promptly of all transfers made pursuant to this

207

authority; Provided further, That not less than $25 million of the authority

granted in this section shall be available only for a program to substitute civilian

personnel for military personnel."

ARMY REORGANIZATION PLAN

Mr. SIKES. I would like to ask that we have the basic outline of the

Army reorganization spelled out for the record.

Mr. BRAZIER. Yes, sir, we will provide it.

[The information follows:]

ARMY REORGANIZATION PLAN

The Army reorganization plan consists of a series of major actions designed to

modernize, reorient, and streamline the Army's organization within the conti-

nental United States. The plan is designed to improve readiness, training, the

materiel and equipment acquisition process, the quality and responsiveness of

management, and better support for the soldier in an era of constrained person-

nel and budget resources. It is estimated that the bulk of the plan will be fully

implemented by December 31, 1973. The reorganization plan was considered dur-

ing the formation of the fiscal year 1974 budget request. Savings associated with

reorganization are not specifically identified but most are included in the opera-

tion and maintenance, Army appropriation submission under the heading of

"Reduction in Civilian Employment-Army Realinement and Reorganization."

Highlights of the plan include :

Elimination of the Continental Army Command (CONARC), the Combat

Developments Command (CDC) and the 3d U.S. Army;

Creation of the Forces Command (FORSCOM), a single field headquarters to

supervise the unit training and combat readiness of all Army units to include the

Army Reserve and the Army National Guard;

Creation of the Training and Doctrine Command (TRADOC), a single field

headquarters to direct all Army individual training, education, and the develop-

ment of organizations, materiel requirements, and doctrine;

Consolidation of the Munitions Command and the Weapons Command into an

Armaments Command;

Consolidation of the major headquarters elements of the Electronics Command ;

Consolidation and realinement of the Army depot system;

Elimination of major administrative levels between all major Army posts and

the Department of the Army;

Increased responsibility, authority, and flexibility for installation commanders;

Establishing a major active Army organizational framework organized solely

to improve reserve component readiness;

Improving the quality and administration of the ROTC program;

Creation of a new command to provide improved delivery of Army health care

in the United States;

Improving responsiveness to individual needs and goals in handling personnel

matters with the Army;

Improving the weapons development and procurement processes by updating

managerial practices and organizations in recognition of technological advances;

Elimination of 813 personnel spaces from the Army staff in the Pentagon;

Transfer of an additional 1.986 individuals from the Department of the Army

headquarters staff to other commands or field operating agencies;

A reduction in requirements of approximately 16,500 military and civilian per-

sonnel spaces.

TRAINING AND DOCTRINE COMMAND RESPONSIBILITIES

The Tradoc commander will be headquartered at Fort Monroe, Va., pre-

viously the home of Conarc. He will concentrate on training and educating

the individual soldier and officer and developing new organizational and doc-

trinal concepts to meet the demands of modern warfare. The reorganization will

provide for more intensive management of individual training. Further, it will

Permit the command and its schools to play a major role in providing assistance

for the training of FORSCOM's deployable units and the training of Reserve

20-192 (Pt. 1) 0 - 73 -- 14

208

component units-dissemininating workable training ideas throughout the total

Army force so as to maintain and upgrade skills of soldiers within units.

In addition to assuming command of individual training and Army schools at

22 major installations, Tradoc will absorb the combat development functions

formerly belonging to CDC and Conarc. Some of the 19 previously separate

branch-oriented CDC agencies, which are presently colocated with the asso-

ciated branch schools, will be merged with the schools. Both combat developments

and training will benefit from harnessing the wealth of experience found in the

schools' faculties and student bodies and the organization charged with distilling

the experience into new doctrine, organizational, and materiel requirements.

To further join combat developments to training, other existing CDC agencies

and activities will be consolidated into three functional combat development

centers colocated with key Army educational institutions. They are the com-

bined arms center at Fort Leavenwdrth, Kans.; administration center at Fort

Benjamin Harrison, Ind., and logistics center at Fort Lee, Va.

Tradoc also will manage the ROTC programs, source of 65 percent of the

Army's new officers through a dedicated structure of four newly established

ROTC regional activities at Fort Bragg, N.C.; Fort Riley, Kans.; Fort Knox, Ky.,

and Fort Lewis, Wash.

The reorganization of ROTC management enhances the capability to super-

vise and assist the professors of military science on the Nation's campuses by

reducing the various spans of control, improving reponsiveness, and providing

continuity between on-campus and off-campus (ROTC summer camp) training

activities.

When fully constituted, the TRADOC organization will include about 159,000

military and 40,000 civilian personnel.

FORCES COMMAND

FORSCOM will move into 3 Army facilities at Fort McPherson, Ga. The

FORSCOM commander will be responsible for combat readiness of all Active

Army, Army National Guard and Army Reserve forces, such as brigades, divisions

and corps in the United States and Puerto Rico. A major contribution of the

reorganization to improved force readiness i ' - ability of the senior commander

to concentrate his attention on one mission-combat readiness.

The new structure eliminates one management layer between the Department

of the Army headquarters and the major tactical units by removing the Con-

tinental Armies from the chain of command in the Active Army forces and from

installation management. This, in turn, permits the Continental Army head-

quarters to concentrate their attention on the readiness and training of the

Reserve forces.

With the reduction in the scope of their missions, the Continental Army com-

manders will also employ considerably smaller staffs.

First Army Headquarters, covering generally the geographic areas presently

assigned to 1st and 3rd Armies. will remain at Fort Meade, Md. Fifth Army

Headquarters will continue to be located at Fort Sam Houston, Tex., and the

headquarters of 6th Army will remain at the Presidio of San Francisco, Calif.

Continental Army commanders will have the support of nine Army readiness

regions. Each region will be managed by a small control element which will serve

as a .,ordination point for Army Reserve and Army National Guard readiness,

trai end support. Within the readiness region, readiness groups--consisting

of bratw., maintenance, and administrative teams and other specialists-will

assist reserve units. Most battalion level advisors will be withdrawn from current

single-unit dedicated status and placed into the readiness groups to capitalize on

branch and functional expertise. Geographically isolated units will retain single-

unit advisors.

FORSCOM will number some 219,000 Active Army personnel and 660,000

personnel in Reserve component units.

ARMY MATERIEL COMMAND

The key action involving the Army support structure is the organizational

realinement of the Army Materiel Command (AMC). These actions will improve

the organizations on which the Army depends for the design, development, pro-

curement, distribution, and support of its combat and support materiel.

Actions within this over-all reorganization include the consolidation of the

Munitions Command and the Weapons Command into a single command, the

209

Armaments Command at Rock Island, Ill. This action will effectively merge

the currently splintered "guns and bullets" responsibilities within AMC and

increase the use of available resources.

Another project within the over-all AMC reorganization is the consolidation

of elements of the Electronics Command headquarters located in Philadelphia,

Pa., with the bulk of the headquarters located at Fort Monmouth, N.J. This

consolidation will eliminate the present geographical dispersion of major Elec-

tronics Command organizations, improving necessary day-to-day coordination

and management efficiency, and providing substantial manpower savings.

The Mobility Equipment Command in St. Louis, Mo., will be converted into

the Troop Support Command and dedicated primarily to improving the personal

equipment and environment of the individual soldier. Initially, Natick Labora-

tories and other personnel equipment related activities will be assigned to this

command. Later, responsibilities for material handling equipment, construction

equipment, and industrial engineering will be transferred to the Tank/Auto-

motive Command in Detroit, Mich.

A realinment of the Army depot system, reflecting managerial improvements

and reduction in workload will be accomplished. These actions will result in a

change in mission and a force reduction of the Atlanta Army Depot, Atlanta,

Ga., and a reduction in the level of activity at Umatilla Army Depot, Ore.

OTHER MAJOR ACTIONS

In the area of health care, a U.S. Army Health Services Command will be estab-

lished at Fort Sam Houston, Tex., to provide a single manager for Army medi-

cal activities in the United States. The new command will perform medical super-

visory functions consolidated from a wide variety of sources, which include the

Office of The Surgeon General (Army) in Washington and headquarters of

CONARC, 1st, 3d, 5th, and 6th Armies.

Concurrently, all medical service schools and the medical training center will

merge into an Academy of Health Sciences, under the Health Services Command.

The ABM Treaty and 1972 congressional actions limiting the SAFEGUARD

program to one site require a consolidation of some activities and reduction in

overall personnel strengths to support the site now under construction in North

Dakota and on-going research and development production and testing.

The merger in place, with concurrent reduction in strengths, of the U.S. Army

SAFEGUARD Systems Command and the SAFEGUARD Logistics Command at

Redstone Arsenal, Huntsville, Ala.

The disestablishment of the SAFEGUARD Central Training Facility at Fort

Bliss, Tex.

A reduction-in-force of the U.S. Army Engineer Division, Huntsvile, Ala., and

Malmstrom, Mont.; U.S. Army SAFEGUARD Communication Agency, Fort Hua-

chuca, Ariz.; and U.S. Army SAFEGUARD Evaluation Agency, White Sands

Missile Range. N. Mex.

Another action within the reorganization is the accomplishment of the long-

sought Army objective establishing a one-stop personnel center for its officer and

enlisted personnel. Establishment of the Military Personnel Center in Alexandria,

Va., combines personnel assignment career planning, counseling, automated ac-

counting and other personnel-related functions currently fragmented through-

out the National Capital region.

Other changes include :

Relocation of Recruiting Command Headquarters from Hampton M/Roads Va.,

to the more geographically favorable mission-suited location at Fort Sheridan, Ill.

Assumption of the responsibility for installation communications-electronic

support throughout the continental United States by the Strategic Communica-

ions Command.

Continuance of the reorganization of the Army Intelligence Command with a

further manpower reduction and moving the Intelligence Command Headquar-

ters from Fort Holabird, Md., to Fort Meade, Md.

'Reduction in size of the U.S. Army Chemical Corps and eventual merger with

the U.S. Army Ordnance Corps and disestablishment of the U.S. Army Chemical

School at Fort McClellan, Ala.

Expansion of the Strategic Tactical Analysis Group in Bethesda, Md., into a

Concepts Analysis Agency so as to provide the Department of the Army with a

capability to analyze and study requirements and alternatives for new materiel

systems and new force designs and operational concepts. This agency will com-

210

plement the recently activated Operational Test and Evaluation Agency estab-

lished at Fort Belvoir, Va., which is designed to provide independent analysis on

operational tests so as to improve procurement and force management.

Relocation of the U.S. Military Academy Prep School from Fort Belvoir, Va.,

to Fort Meade, Md.

ASSISTANCE TO AFFECTED EMPLOYEES

Civilian employees affected by the reorganization will be afforded entitled bene-

fits under the Department of Defense stability of employment program, Civil

Service Commission displaced employee program and re-employment priority

list. They will be given priority consideration for vacancies occurring where

they are now employed.

Travel and transportation expenses will be allowed for career employees who

must be relocated to other geographical areas. The local offices of the Civil Serv-

ice Commission, State Employment Service offices and business firms will be

solicited for assistance in locating employment for those needing such assistance.

A Personnel Coordination Center, consisting of representatives of the Office

of Personnel Operations, Director of Civilian Personnel, and the U.S. Army

Personnel Information Systems Command, has been established to monitor all

military and civilian personnel actions associated with the reorganization. Goals

of the center are to: Provide personal consideration to affected personnel and

their families, achieve minimum movement of personnel within and between com-

mands; and serve as a DA headquarters coordination activity to ensure a smooth

transition to the new continental U.S. Army structure.

Mr. SIKES. Off the record.

[Discussion off the record.]

CAMP DRUM FAMILY HOUSING

Mr. McEWEN. Mr. Chairman, I would like to say that I hope that

when we have the new family housing completed at Camp Drum it

may be as attractive and as well-constructed as these photographs we

have been looking at of the new enlisted men's barracks.

Mr. SIKES. Are you in position to discuss the Camp Drum situation

now?

General COOPER. Yes, sir.

After our meeting last week we arranged a meeting with Mr. Fli-

akas in the Office of Secretary of Defense to discuss the fact that in

order to award Camp Drum, we would not be able to award Grand

Forks.

We made a proposition to him which would provide almost the same

quality in the housing at Camp Drum you were talking about of the new

barracks. So we have tentative approval from Mr. Fliakas to proceed

and we are proceeding on that basis.

This will require, if we are going to provide housing at Grand

Forks, that we get a change to the authorization just for Grand Forks,

because otherwise we will go over the $24,000 authorization limit.

We will ask tl at Congress provide that. We have done that once

before.

Mr. SIKES. That is for Grand Forks ?

General COOPER. That is right.

Mr. SIKES. You will be able to go 'ahead at Camp Drum ?

General COOPER. That is correct, sir.

Mr. SIKEs. When can you do that ?

General COOPER. Well, we have open bids by the contractors, and I am

not sure exactly but it will be within 1 or 2 weeks. We have to move

out quickly because the construction season is on us.

Mr. McEwEN. Mr. Chairman, may I say that we have had a break in

the weather this year. After a rather mild winter and an excellent

spring; it is a time when it is inviting to get construction started.

General COOPER. We have the open bids and we are in the process of

negotiating with the contractor now.

Mr. SIKES. The committee is very concerned about this because we

know how bad the housing situation has been at Camp Drum. Will you

pursue this vigorously and will you advise the committee step-by-step

of what happens ?

General COOPER. Yes, sir.

Mr. SIKES. Gentlemen, we will reconvene at 2 o'clock.

Thank you very much.

AFTER RECESS

BASE UTILIZATION AND BASE CLOSURES

Mr. PATTEN. Last year in its report on the fiscal year 1973 military

construction bill, this committee included the following language:

The committee directs that the office of the Secretary of Defense and the

military services develop firm criteria for base realinement actions and furnish

these to the committee during the hearings on the fiscal year 1974 request.

Furthermore, in connection with future base realinement actions, the committee

will expect Department of Defense witnesses to be able to justify their base

closure decisions on the basis of these criteria.

In addition, I would like to include in the record at this point the

language in the committee's report explaining why such criteria are

necessary.

[The language follows:]

The committee has attempted, in past years' hearings as well as during the

hearings on the fiscal year 1973 military construction request, to establish what

criteria are used in evaluating proposed base realinements. Also, numerous ques-

tions have been directed at future utilization of certain installations or classes

of installations. In the fiscal year 1973 hearings more than 75 such questions

were asked. Department of Defense witnesses were not able to be very frank and

informative in their answers. This makes it more difficult for the committee

to examine and evaluate the assumptions and criteria upon which base closure

actions will proceed. The committee feels that the difficuly in providing facilities

at numerous military installations while base closure actions are in the offing

is not that projects will be built at bases which are being considered for closure.

but that unless firm decisions are reached, announced, and implemented, guide-

lines may shift in a way which will cause the closure of bases which had been

considered to be firm. The reluctance of Department of Defense witnesses to pro-

vide current guidelines greatly hinders the ability of the committee to act in a

foresighted manner in this regard.

Mr. PATTEN. Are you ready to provide these criteria to the committee

and to discuss them in relation to your recently announced base clos-

ure package?

General COOPER. Yes, sir.

[Information follows:]

The Army's Criteria for Base Realinement Actions is provided.

CRITERIA FOR BASE REALIGNMENT ACTIONS

1. Purpose

The purpose of this document is to present the criteria and major considera-

tions used within the Army to determine which bases and activities should be

consolidated, reduced, realined or closed.

212

2. Background

(a) Army missions involve the accomplishment of a wide variety of functions

requiring both general and specialized accommodations. The base structure

varies from administrative office space to production/rebuild plants; from troops

bases with tens of thousands of acres to small complexes in urban areas. As

missions and the size of the Army vary, so do the requirements for bases and

facilities.

(b) The Army continually reviews its missions, strength and structure and,

concomitantly the base structure requirement to insure that it is in proper

balance. Some requirements are relatively fixed because they support more

stable missions such as military schools, research and development activities,

materiel testing and specialized depot activities. These bases may experience

variations in workload, however, the need for the bases, and their physical

plants, is a continuing requirement. On the other hand, some Army missions

are subject to large variations and may either generate additional requirements

or reduce requirements for bases. Examples are training centers for basic and

advanced individual training, aviation training facilities, production facilities,

administrative space to support specialized activities and troop unit bases.

(c) The Army also reviews its missions to determine where and in what

manner it can consolidate, realine and reduce resource requirements and still

operate efficiently. This review may or may not result in a change in the base

structure.

(d) Inherent in these analyses are consideration of the following criteria

(not rank ordered) :

Mission requirements

Budget/manpower constraints

Cost savings

Personnel turbulence

Civilian labor market

Facilities/housing availability

Capital investment (sunk cost)

Geographical location

Land area

Impacts on other services/agencies

Community impact

Environmental impact

Reserve components support

Mobilization and contingency requirements

Encroachment

Long range plans

(e) The Army does not wish to convey that the analyses will produce clear-

cut advantages for proposed realignments vis-a-vis related alternatives. This

is not always the case. Decisions are often charged with great emotionalism

for the decisionmakers, the public and Congress. There are formidable realities

that must be confronted. Some examples follow:

(1) Investment in faciities.--The decisionmaking criteria often work at cross

purposes to one another. On the one hand, the Army is short of permanent

facilities in every construction category; and, if a base is to be closed, it usually

means walking away from some permanent facilities. On the other hand, if

the missions performed at that post can be performed satisfactorily by con-

solidating them with missions at other posts, then substantial overhead savings

could generally be realized.

(2) One-time realinement cost.-A factor complicating the execution of re-

alinement actions, regardless of the long range savings associated with the

actions, is their one-time costs. These costs must be amortized within a reasonable

period of time.

(3) Emergency expansion.--The Army often finds itself in a "crossfire" with

respect to base management and pressing facilities requirements. In some cases,

the urgency of the moment forces the Army to adopt courses of action which

run counter to the long range (peacetime) objectives. For example, during the

VTietnam war the Army expended funds on aviation facilities at a number of

bases, all of which will not be required by a peacetime Army.

3. Mission requirements

The base structure of the Army exists to support Army missions. These mis-

sions are influenced by many factors, for example, strategy, budget, force level,

Department of Defense guidance, weapons systems, new technology, et cetera. As

213

mission changes occur, an analysis of the resources, including bases, allocated to

accomplish that mission is made by the Department of the Army staff agency

having proponency for the mission. Existing resources are weighed against the new

requirements and adjusted accordingly. It is here that those bases no longer

required for accomplishment of the changed mission are most frequently identi-

fied. It is there that the economies of consolidation, realinement or reduction in

scope of operations are identified. The ability of each base to meet the unique

operational and training requirements of the assigned force or function is of

paramount importance.

4. Budget/manpower constraints

These constraints permit retention of only the minimum number of bases;

demand the avoidance of costs for unnecessary personnel relocations; and mili-

tate against construction at those bases with limited land area and outmoded,

old, functionally inefficient facilities requiring large investments for replacement

facilities. Significant annual savings may result from the closure of such bases.

Consolidation of missions on a single multimission base which subsequently

results in a base closure generally produces significant annual savings. However,

these savings are offset in some instances by additional investment at the gaining

base. Additionally, one-time relocation costs become a factor. In evaluating the

budget implication of base realinements it is necessary to weigh initial and

annual savings against the one-time construction and movement costs of the

various options. In general, large outlays in construction or equipment funds are

not feasible and options which depend on such outlays are avoided unless no

other viable alternative exists.

5. Cost savings

The objective of the Army is to accomplish the assigned mission at the least

cost. Where alternatives exist it is essential that the least cost, both in terms of

dollars and manpower, be selected. The decisionmaker must not be lulled into

thinking that the proposed action will save an amount approximately equaling

the base's operating budget and military pay if he closes the base. In cases where

the mission requirement for the base is eliminated, a savings equaling the oper-

ations cost prior to phasedown and closure cannot be achieved. As the activity

phases down, fewer plumbers, carpenters, supply clerks, et cetera are needed and

utility costs also decrease. Those savings would be realized with or without

closure. In cases where the mission is not eliminated the savings at the base to

be closed must be offset by the increased costs at the base, or bases, assuming

the mission to determine net savings. In this connection, a base function easily

overlooked is that of area support. Many bases provide support to the Reserves,

ROTC, recruiting activities, air defense and a host of other Army and other serv-

ice activities in the geographical area. Although it is feasible to provide many

of these services from another location, or through contract, these alternatives

carry offsetting costs.

6. Personnel turbulence

The adverse impact of military and civilian personnel turbulence must be given

significant consideration because of both the high cost and the adverse effect

on morale.

7. Civilian labor market

Many Army missions involve utilization of a highly specialized and unique

civilian work force. Many of these people establish deep roots in the local com-

munity and are reluctant to dislocate with the transfer of the functions they

perform. The lack of appropriate labor market thus becomes a factor in evalu-

ating proposed realinement actions.

8. Facilities/housing availability

Maximum utilization of existing Government facilities with minimum expendi-

tures for new facilities is the primary goal in realinement actions. This includes

both mission related facilities and support facilities. The facility types that are

of prime concern in base realinement actions vary dependent on the mission

under consideration. For combat and combat-support units, the firing ranges,

vehicle maintenance space, parking area and maneuver area are of maior con-

cern in evaluating realinement proposals. Conversely, for administrative and

headquarters activities, adequate administrative space is essential. For training

activities, classroom and student housing are key factors. For all actions, avail-

ability of housing (bachelor and family) is a significant element. However,

214

facility availability varies in importance and influence on base realinement

actions. In some cases, mandatory requirements exist. For example, adequate

firing ranges and maneuver area are an absolute requirement for combat and

combat-support units. Certain unique facility requirements are generated by

intelligence, communications, logistical, and research and development activities.

Relocation of these functions which do not have facilities available to accom-

modate them may not be feasible due to the cost of new facilities. Also, due to

mission requirements, the required facilities must often be available prior to

transfer of the function. This can often be expensive in terms of delay in savings

to be realized as well as redundancy in equipment and facilities. Additionally, in

considering bases for closure, the overall condition of the real property facilities

at the base is an important element in the selection process. Relocation of an

activity housed on a base with considerable substandard facilities-both prime

mission as well as support-may be most effective even if certain facility criteria

cannot be initially met. Over a period of time provision of a few additional

facilities could prove economically beneficial as opposed to a large expenditure

for expensive replacement facilities at the former base. An additional facility

consideration is the extent of area support to other bases. For example, if a base

provides hospital, housing, and other support facilities for surrounding bases,

then it may not be possible to completely close the base. As a result, savings from

the realinement are significantly less than at a base where all activities can be

shut down and facilities declared excess.

9. Capital investment (sunk cost)

Realinement actions are designed to achieve the best utilization of permanent

facilities at large, multimission bases. If relocation of a function or mission

requires new construction of duplicate facilities, then the cost reduction sought

must be carefully weighed against movement and construction costs that result

from the propsed realinement. This consideration is especially important in view

of the shortage of construction funds and the large construction backlog. Where

mission changes dictate relocation of a particular function utilizing permanent

facilities at a large, multimission base, attempts are made to backfill the vacated

facilities with other compatible activities from small, single-mission, high cost

bases or from leased facilities.

10. Geographical location

The geographical location influences the ability of assigned forces to execute

their mission. Weather, terrain, vegetation, proximity to strategic airfields, trans-

portation networks, et cetera, all contribute to retention of bases which enhance

operational effectiveness. In some cases certain mandatory elements may present

themselves. For example, basic combat training and aviation training require

good weather in order to maintain course schedules. Combat and combat-support

training activities require appropriate firing ranges and maneuver area. Each

type unit has its unique requirements. A geographical location which is adequate

for the training of the infantryman would not necessarily be adequate for the

training of tank crews.

11. Land area

The need for adequate and suitable land area to support major combat units

and their supporting forces is a major consideration. Bases must be capable

of supporting the readiness and deployment of the assigned forces as envisioned

in the U.S. strategy. This requirement often determnnines which bases will be

retained in the active inventory. Where mission compatibility can be achieved,

the consolidation of activities at large, multi-mission bases, takes precedence

over utilization of small, single-mission bases.

12. Impact on other scrvices/agencies

The Army provides support to many units and activities of the Department

of Defense, the other services, and other Federal agencies. Inherent in any base

realinement action is consideration of the impact on these agencies. The person-

nel turbulence and costs associated with relocating or supporting these type

activities are an integral part of any analysis conducted.

13. Community impact

Civilian support resources (e.g., community housing, medical, schools, and

recreational facilities) are a consideration in developing base realinement ac-

tions. Of particular importance is family housing. Areas which have residual

capability to adequately house families negate the cost of providing Government

215

housing and facilitate rapid completion of the proposed action. Adequate sup-

port should exist on or off a gaining installation to avoid a realinement action

being counterproductive in terms of morale. Since personnel support capability

on our installations is limited, the contribution of the civilian community in

this area is important. Conversely, realinement actions, which reduce the Army

presence in an area, seriously impact on communities, particularly those in

which the major source of the economic base is the military installation. When

possible, realinement actions are designed to minimize the impact on local com-

munities. Where appropriate, assistance is provided to local community leaders

in their negotiations with the Office of Economic Adjustment, Department of

Defense, whose function is to assist communities in reestablishment of an eco-

nomic base where reduction in Defense expenditures has been severe.

14. Environmental impact

All actions must be assessed to determine their impact on the environment.

Base realinement options must have an initial assessment during the preliminary

planning. If significant environmental impact is indicated, or the action is

determined to be controversial, at either a gaining or losing base, then an

environmental impact statement must be prepared.

15. Reserve components support

The increased emphasis on utilization of Reserve component forces to meet

future contingency requirements must be considered. Reserve units are gener-

ally constituted in areas where there are population resources. Their readiness

depends upon availability of adequate ranges and training areas. This requires

that the range facilities and training areas not only be of the proper size and

configuration, but also that they be within reasonable commuting distance.

Readiness is adversely affected by increased commuting time and corresponding

decreased training time availability. Concomitantly, personnel job satisfaction

is lowered and personnel recruiting and retention rates decreased. Many of our

bases, both active and inactive, are used extensively for support of these units,

both for weekend training and annual summer training. The impact on these

type units is an integral part of any analysis conducted.

16. Mobilization and contingency requirements

The type and number of bases required are determined by the need to be

capable of supporting the strategy directed by national policy, the operational

and training requirements of the Army, and the retention of sufficient flexibility

to support unprogramed increases in troop strengths. Coupled with this is the

uncertainty as to when a base might be needed again. The costs of inactivating

and reactivating a base can offset savings derived from its closure. Although

we hope that we are entering upon a prolonged period of peace-a hope and

expectation which is not unlike that after World War II and the Korean war-

any decision to inactivate a base, whether it is retained in standby status for

mobilization and contingency requirements, or is disposed of, is made without

positive assurance that the decision-in the long term-will prove to be a good

one.

17. Encroachment

Urban and airspace encroachment into vital areas surrounding installations

is of continuing concern. Some installations which were originally remote have

attracted major population growth and, as a result, continued operations have

been threatened through urban expansion. Civilian aviation activity has served

to restrict the airspace available for military operations. Encroachment, there-

fore, is an element in determining the future viability of an installation.

Currently, programs to protect installations from encroachment are being insti-

tuted. These are comprised of efforts to obtain properties adjacent to bases so

that only activities compatible with military operations will be developed in

these areas. It is also possible that major weapons changes may bring about

encroachment "from within." For example, ranges now adequate for artillery

firing, may become too small for artillery weapons which may be introduced in

the future. However, where encroachment has become a problem, its impact

is considered during development of base realinement actions.

18. Long-range plans

Since the future forces cannot be predicted with certainty and are subject to

unprogramed changes, flexibility to accommodate these changes within the base

structure should be preserved when possible and economical. This entails de-

veloping reasonable assumptions on what unprogramed force changes might

occur and determining how the various options could support the assumed force

changes. However, flexibility is difficult to quantify and, as a result, tends to

be a subjective consideration. There are some instances though which do lend

themselves to objective analysis. For example, basic combat training production

capability at each training center can be determined. Based on the required

levels of production, the degree of flexibility (unused production capacity)

within the structure can be determined and the degree that the structure can

meet increases can be calculated. Similarly, workload versus capacity can be

determined in a quantifiable manner for production and depot activities. Con-

versely, the degree of flexibility of the installation structure to meet other

program changes not the result of clear-cut workloads is difficult to determine.

For example, the flexibility of the base structure to accommodate major combat

units currently deployed overseas, depends on many variables. These variables

include type of unit, equipment density, mission requirements of the unit, if

they are to be retained as active duty forces, or as reserve forces. Realinement

alternatives are weighed in terms of their potential to meet unprogramed force

changes.

Mr. PATTEN. Are there any questions on my left ?

Mr. DAVIs. The succeeding questions deal with this matter.

CLOSURE OF FORT WOLTERS, TEX.

Mr. PATTEN. The Army is proposing to close Fort Wolters, Tex.,

and consolidate its helicopter training activities at Fort Rucker,

Ala. What is the optimum training workload of a helicopter training

base ? What criteria apply to this type of activity ? Where does Fort

Rucker rank-higher or lower-according to each of these criteria

in comparison with Fort Wolters ?

General COOPER. Both Fort Rucker and Fort Wolters can adequately

support primary helicopter training requirements. However, the train-

ing loads have been reduced to the point where it is no longer necessary

to maintain both installations. Only Rucker has the facilities and

land area to support a one aviation training base concept. Rucker has

the capacity to support all anticipated training, including primary,

advanced, and graduate level; whereas Wolters has been limited just

to primary.

The basic criteria that would be considered in selecting one base

over the other would be such things as weather, available airspace,

land area, and support facilities. Rucker is superior to Wolters in

terms of land area and facilities available to support the training

base concept. They are probably about equal in weather. Available

airspace is also somewhat a tradeoff.

I can provide additional information as to what the facilities are

at Wolters and Rucker. I can also, if you like, go down the con-

sideration of the criteria that we had on a point-by-point basis. It

depends upon how much time you want to spend on this particular

subject.

Mr. PATTEN. Perhaps you can expand your answer for the record.

I would like you to put the criteria in the record at this point.

[The information follows:]

Mission rcquircments.-Decrease in training load from 6,887 pilots in fiscal

year 1969 to a projected 1,502 in fiscal year 1974 permits contraction of training

base from three to one installation. Fort Rucker is the only installation of the

three concerned which is capable of accommodating the entire training load.

Budget/manpower constrainlts.-Consolidation will eliminate 946 civilian and

1,111 military jobs.

217

Cost savings.-Annual recurring savings are projected as $25.2 million with a

one-time cost of $9.9 million.

Facilities/housing availablc.-Due to the minimum increase in civilian em-

ployees (+23) at Fort Rucker and the decrease in military (-68), the MCA

required as a direct result of the consolidation is $534,000 for the expansion of

aviation training and safety facilities.

Community impact.-The inactivation of Hunter AAF will have little impact

on the local community, while the action at Fort Wolters will have a major

impact on Mineral Wells, Tex.; and nearby towns. The inactivation of Fort

Wolters will result in the loss of a civilian and military payroll of approxi-

mately $35 million.

Impact on other services/agencies.-The inactivation of Hunter AAF will

impact on an Air Force radar unit, a Coast Guard rescue unit and a FAA radar

approach control element which are tenants. Negotiations for revised support

agreements are being conducted.

Mobilization and contingency requirements.-Both Hunter AAF and Fort

Wolters will be retained as inactive installations in the event a rapid expansion

of the aviation training base is required.

Mr. PATTEN. In this regard, is Fort Hunter of comparable status ?

General COOPER. Hunter Army Airfield?

Mr. PATTEN. Yes. Is it in comparative status as compared to Fort

Rucker and Fort Wolters ?

General COOPER. That is right. Hunter Army Airfield was used

just for Cobra training and a portion of rotary-wing pilot qualifi-

cation training. That training will be done at Fort Rucker. So, a

comparison between Hunter and Rucker versus Rucker and Wolters

was made. As a result, we are placing Hunter in a caretaker status.

Mr. PATTEN. What is the amount of construction which has been

put in place at Fort Wolters in the past 5 years?

General COOPER. In the past 5 years, we have MCA projects total-

ing approximately $2.5 million. In the fiscal year 1973 program, there

was a water pollution control project which was approved in the

amount of about a quarter of a million dollars. We have placed that

project in deferred status and may not award it because of the impact

of the realinement plan.

Mr. PATTEN. How do the replacement values of facilities at Fort

Wolters and Fort Rucker compare?

General COOPER. Roughly two-to-one. Rucker is twice as much as

Fort Wolters. In total, the cost of the real property, including land,

as of June 30, 1972, was about $94 million for Rucker and about $48

million for Wolters.

Mr. PATTEN. How much construction will be required at Fort

Rucker because of this consolidation, both in the next 5 years and long-

range?

General COOPER. Because of this reduction right now, it will be about

half a million dollars to provide the supporting facilities for the basic

flight training. We do not have any specific long-range requirement

resulting solely from this increased mission. That does not mean there

will not be additional construction at Fort Rucker, but it will not be

as a direct result of closing down Fort Wolters.

Mr. PATTEN. How much will it cost to close Fort Wolters, and how

much will you save?

General COOPER. The one-time cost associated with closing Wolters

is about $6.5 million. The annual recurring savings are estimated to

be about $14.6 million.

Mr. PATTEN. What is the present value of savings from this action ?

General COOPER. I am not sure exactly what that question means,

sir. Do you want to discount the future savings?

Mr. PATTEN. Yes, as compared to the $14 million.

General COOPER. That is what we anticipate will be the annual re-

curring savings.

Mr. PATTEN. So, in comparison, we are saying what is the present

value, not the recurring, not the $14 million.

General COOPER. It depends on how much you want to discount the

future savings. If you discount the future savings at 5 percent or 10

percent, we can compute that and insert it for the record, sir.

[The information follows:]

The present value of savings associated with closing Fort Wolters computed

on a 5-year criteria based on a 5 percent discount value is $64.8 million, and on

a 10 percent discount value is $58.1 million.

Mr. SIRES. Thank you very much, Mr. Patten.

CLOSURE OF VALLEY FORGE GENERAL HOSPITAL

The Army is proposing to close Valley Forge General Hospital in

Pennsylvania. What criteria apply in this decision, and how did you

decide that this particular hospital is the one to be closed?

General COOPER. If I may, sir, I would like to go down through

the criteria that we inserted earlier for the record for Valley Forge.

The first thing is mission requirements. The patient population was

1,804 patients during the Vietnam conflict. The workload at Valley

Forge has declined to about 469 patients as of last October. With the

availability of better facilities elsewhere, such as Fort Gordon, which

is not quite yet onstream, and Walter Reed, the Valley Forge work-

load can be transferred to these newer facilities.

Three hundred and twenty patients are projected to be the patient

load at Valley Forge as of the end of fiscal year 1973.

The next criterion we considered was budget and manpower con-

straints. The closure will reduce the civilian employment by 490

and release 221 military personnel for assignment to other duties.

Getting to cost savings, which is also a criterion, the annual recurring

savings are projected at $6.9 million, with an estimated one-time

cost of $6.8 million. As a single mission installation, the cost of provid-

ing health care at Valley Forge are approximately 50 percent higher

than like services at similar hospitals, such as Fort Gordon.

Mr. SIRES. That is a very significant cut. Why are costs higher there ?

General COOPER. Because you have the overhead of running just that

installation. You still have to have the MP's, for example. You still

have to have all the supporting services, commissaries, and so forth.

Whereas when you have the hospital at Fort Gordon, the hospital is

on a base that already has troops there and the supporting services.

Mr. SIRES. When was the Valley Forge hospital built?

General COOPER. It was initially completed in 1942.

Mr. SIRES. Is it a cantonment type facility ?

Colonel RAISIG. Yes, sir.

Mr. SIRES. Then it is probably inefficient as far as maintenance and

operation are concerned.

General COOPER. That is correct, sir. If we were to keep it at that

location, we really would want to put, we estimated, over a million

dollars into it right now, just in maintenance.

Mr. SIKES. You would have to rebuild it, would you not ?

General COOPER. That is right. You still would not have a new

hospital.

Mr. SIKEs. You do not require the capacity ?

General COOPER. That is correct.

EXCESSING OF CLOSED INSTALLATIONS

Mr. TALCOTrr. What happens to Fort Wolters and what happens to

Valley Forge Hospital? Are they excess and given back-

General COOPER. They go through the normal procedures for ex-

cessing.

Mr. TALCOTr. Valley Forge as well as Camp Wolters?

General COOPER. Valley Forge as well as Camp Wolters. It con-

trasts with Hunter Army Airfield.

Mr. TALCOrr. What happens to Hunter Army Airfield ?

General COOPER. I may be wrong about Fort Wolters, but Hunter

Army Airfield will be put in caretaker status on the basis that we may

need it, for example, if a division is pulled back from Europe. We

may want to use the Hunter-Stewart complex to house a new division.

We want to keep all those aviation facilities.

Mr. TALCOTrr. There are no encroachment problems?

General COOPER. That is right. It is really almost too good in terms

of aviation, but it is there and is an excellent facility. We would plan

to keep that.

At Valley Forge, we plan to excess that completely. We would go

through the normal procedures of asking within the Department of

Defense, and the Coast Guard, and so on.

Mr. SIKES. How much land is involved at Valley Forge?

General COOPER. I do not know exactly, sir.

Mr. LOCKWOOD. 182 acres.

Mr. SIKES. At Fort Wolters, you state that you are not certain what

will happen there?

General COOPER. We are putting it in caretaker status.

WORKLOAD VALLEY FORGE GENERAL HOSPITAL

Mr. SIKES. I would like to have for the record the workload at Val-

ley Forge for the last 5 years, and the projected workload if it were

not closed.

General COOPER. Yes, sir.

[The information follows:]

VALLEY FORGE GENERAL HOSPITAL, AVERAGE DAILY BEDS OCCUPIED

Actual, fiscal year- Projected, fiscal year-

1969 1970 1971 1972 1973 1974 1975 1976 1977 1978

Active duty military ..........-.......... ....... 880 845 700 446 231 232 232 232 232 233

Dependents of active duty..........-.-.-......... 27 22 24 13 9 9 9 9 9 9

Retirees.............._.___.- _ __ ___ . _ 28 27 29 27 25 25 26 26 26 26

Dependents of retired and deceased. ........ 22 21 21 17 16 16 16 17 17 17

All other........_._........_____. ________ 10 5 8 7 7 7 7 7 8 8

Total.-.-...__............ __....... - 967 920 782 510 288 289 290 291 292 293

t Assumes Valley Forge General Hospital not to be closed and no change in policy controlling medical regualtion of

patients.

220

AVERAGE DAILY CLINIC VISITS

Actual, fiscal year- Projected fiscal year-

70 71 72 73 74 75 76 77

Active duty military-----------------.... 758 758 458 282 282 282 282 282

Dependents of active duty...------------- 89 96 81 65 65 65 65 65

Retirees-----------------------.... 37 46 55 62 67 74 81 88

Dependents of retired and deceased......-----------. 56 67 74 82 91 100 109 118

All other-....-..-....-...........-...-._.. 17 24 27 40 40 40 40 40

Total ...-........ ........ .... 957 991 695 531 545 561 577 593

1 Assumes Valley Forge General Hospital not to be closed and no change in policy controlling medical regualtion of

patients.

BASIC TRAINING INSTALLATIONS

Mr. SIKES. The Army had a sharp reduction in its training work-

load. This is true of its basic training. What is the status of plans

to reduce installations for basic training, if there are such plans?

General COOPER. We are currently conducting a reevaluation study

for the six basic training centers which we have now. We are doing

that as part of the Fort Dix reexamination which the Secretary of

Defense announced on April 17.

Mr. SIKES. What primary factors make a post good or bad for basic

training?

General COOPER. Some of the things are mobilization and contin-

gency requirements. Normally, the ATC structure must serve as the

nucleus for expansion. It is essential that each ATC continue in oper-

ation during mobilization. That is one factor.

Another is environmental considerations. In essence, how many

available training days do you have during the year? If the weather

is bad, it is difficult to train.

Another factor is encroachment. If you are in an area where there

is a lot of pressure to move you out for industrial or other reasons,

that is another factor.

Of particular interest, of course, is the mission requirements. You

want to be able to train the troops as well as possible wtih the avail-

able facilities.

Mr. SIRES. Will all of these apply in your decisions which are

anticipated as a result of the current study ?

General COOPER. Yes, sir; those, and also another one is the avail-

able permanent facilities. That is another criterion.

Those are the basic things that I talked about in terms of the train-

ing center.

You also have to consider the budget and manpower constraints,

cost savings, and the community impact.

Mr. TALCOTT. How about the area location ?

General COOPER. The area location very definitely affects mobiliza-

tion, and also the number of training days you can expect to get

per year.

There are two factors. We want to have geographical dispersion

so as to reduce costs; and also, as you mentioned this morning, the

sensitivity of the troops. If you have a training base located where the

families can come and visit the men or they can go occasionally on the

week end, that is also a significant factor.

Mr. SIKES. You have six basic training areas now in the Army.

Can you rank these according to the applicable criteria ?

General COOPER. Yes, sir, we can. I do not know if you want me to

go over each one.

Mr. SIKES. Do it for the record.

(The information follows:)

(The table below summarizes the criteria when applied to the 6 Army Training Centers

Fort

Fort Leonard Fort Fort Fort Fort

Criteria Knox Wood Jackson Ord Dix Polk

Mission requirements................ Good..-.... Excellent..- Excellent-. Excellent_. Excellent._ Excellent.

Mob contingency requirements........ Good....... Excellent... Excellent._. Good...-... Fair ...... Excellent.

Environmental---- ----.... - -.. Good....... Good ..... Good....... Good....... Poor ...... Excellent.

Reserve component support ...-.... Excellent-.. Excellent_.. Excellent... Excellent..- Excellent. . Excellent.

Encroachment_-----------..--_... Good.-..... Excellent.. Excellent.__ Poor - ..... Poor ...... Excellent.

Geographical location-.....---------. Excellent.. Excellent--- Excellent .. Excellent.. Poor-..... Excellent.

Facilities...------------- - Good....... Good....... Fair........ Good....... Excellent.. Poor.

Housing and community support..... Excellent.-- Excellent-. Good....... Good-...... Excellent-.- Poor.

Personnel turbulence.. .. ... Approximately equal effect.

Budget and manpower constraints-.. Approximately equal effect.

Mr. SIKEs. Mr. Patten.

UTILIZATION OF FORT DIX

Mr. PATTEN. What amount of construction has been put in place

at Fort Dix in the past 10 years ?

General COOPER. About $80 million.

Mr. PATTEN. What is the amount of permanent construction at Fort

Dix ?

General COOPER. The amount is about $172 million, excluding land.

Mr. PATTEN. What is the cost of replacement?

General COOPER. If we had to replace that $170 million, it would

cost us now about $670 million.

Mr. SIKES. How much real estate do we have ?

General COOPER. I am not sure.

Mr. LOCKWOOD. I am W. M. Lockwood, from General Cooper's

office.

We have about 32,000 acres at Fort Dix.

Mr. PATPEN. What number of units of adequate and inadequate

family housing, barracks spaces, and officer quarters are there at Fort

Dix?

General COOPER. We have about 2,200 family quarters onpost. Of

those, we declared 400 very recently as inadequate. Once you declare

it inadequate, you cannot upgrade it for 5 years. There are some others

that are better than those that are inadequate but still require addi-

tional upgrading, which we plan to do in the future.

In barracks space. we have about 18,000 permanent barracks spaces,

based on 72 square feet per trainee. As to how many could be mod-

ernized to adequate standards, we can modernize in essence all of those

barracks to modern standards.

222

[The information follows:]

Status of the family housing units at Fort Dix:

Fully adequate----... ....... ..---------------------------------------------------------- 1, 205

Funded for improvements that will bring to fully adequate standards....----------------------------- 300

Programed for improvements that will bring to fully adequate standards----------... ----------------- 295

Inadequate --------------------------------------------------------...------------. 400

Total------..----------.................---------------------------------------...-------------.......... 2,200

STATUS OF BACHELOR HOUSING SPACES AT FORT DIX

Bachelor

officer

Barracks quarters

Permanent adequate.................------------------------------------------------------- 0 120

Permanent substandard that can be made adequate----------.... -------------------- 18, 257 180

Total------------....................................---------------------------------------------. 18, 257 300

SAVINGS AND MILITARY CONSTRUCTION AND FAMILY HOUSING IMPACT OF

ARMY REORGANIZATION AND BASE CLOSURES

Mr. SIKES. I would like, for the record, the military construction

and family housing impact of the Army reorganization and base clo-

sure plans, by base. I would like to have the costs and the savings

associated with those actions. -

[The information follows:]

Military construction and family housing costs required and avoided as a

result of the Army reorganization and realinement actions are provided.

For additional information, see appendix to this volume, page 859.

SUMMARY

CONSTRUCTION REQUIRED

(AMOUNT IN THOUSANDS - UNITS IN PAREN)

Military Construction

Family Housing

Military Construction

Family Housing

FY 73

8,500

0

FY 73

0

2,650(100)

FY 74

11,182

0

FY 74

9,834

0

COSTS REQUIRED

FY 75 FY 76

22,025 13,166

8,469(290) 15,438(498)

CONSTRUCTION AVOIDED

FY 75 FY 76

19,666 16,285

24,357(832) 8,650(279)

FY 77

4,088

6,419(196)

FY 77

10,972

6,451(197)

LONG

FY 78 TOTAL RANGE

1,795 60,756 61,999

35,151(1013) 65,477(1997)

FY 78

5,683

38,275(1103)

LONG

TOTAL RANGE

62,440 71,602

80,383(2511)

The family housing costs are derived from an average family housing requirement based on total

military strength considering the changes involved in Phase I and II. Family housing surveys to

be conducted in CY 73 (incl consideration of new MAHC) may result in some changes but should

not substantially affect data presented.

MILITARY CONSTRUCTION PROGRAM COSTS

REQUIRED AS A RESULT OF CONUS REORGANIZATION AND REALIGNMENT ACTIONS

(Exclusive of Family Housing)

($ Thousands)

LOCATION-LINE ITEM FY 73 FY 74 FY 75 FY 76 FY 77 FY 78 TOTAL LONG RANGE

ALABAMA

Fort McClellan 404 558 17,000 17,962

Rehab Training Fac. 354 558

Utilities & Grounds Improvement 50

Barracks Complex 12,800

Bachelor Officer Quarters 2,600

Boiler Plan Expansion 400

Gymnasium 1,200

Redstone Arsenal 299 299

Training Fac (Chem) 299

Fort Rucker 534 534

Airfield Paving 219

Stage Field Lighting 90

Control Towers (5) 45

Operations Bldg & Fire Station 149

Fencing 31

MILITARY CONSTRUCTION PROGRAM COSTS

REQUIRED AS A RESULT OF CONUS REORGANIZATION AND REALIGNMENT ACTIONS

(Exclusive of Family Housing)

($ Thousands)

LOCATION-LINE ITEM FY 73 FY 74 FY 75 FY 76 FY 77 FY 78 TOTAL LONG RANGE

ALASKA

S. Fort Wainwright 2,714 928 550 383 125 4,701

BOQ Modernization 750

Cold Storage Fac. 928

Relocate Activities from N. Post 1,965

Airfield Control Tower 200

Telephone Expansion 350 D

Auto Self Help Garage 383 %:

Bank Fac. 125 c1

GEORGIA

Atlanta Army Depot 119 119

Security Fencing 119

Fort Gordon 3,632 7,816 270 11,718 19,800

Academic Fac Modification 2,132

Academic Facility 7,816

Printing Plant MOD 201

Communication & Electronic Fac. 1,299

Senior Enlisted Bachelor Quarters 270

Various Supporting Fac. 19,800

REQ

LOCATION-LINE ITEM

GEORGIA (Cont'd)

Fort McPherson

Construct Parking Lot

Rehab Bldg for Adm

Headquarters Bldg (FORSCOM)

ILLINOIS

Rock Island

Admin Fac Mod

Air-Cond Admin Fac

Fort Sheridan

Alteration and A/C Admin Fac

KENTUCKY

Fort Knox

Admin Fac Mod (ROTC)

Admin Fac Mod 1/

Lexington-Blue Grass

Admin Fac Mod

MILITARY CONSTRUCTION PROGRAM COSTS

UIRED AS A RESULT OF CONUS REORGANIZATION AND REALIGNMENT ACTIONS

(Exclusive of Family Housing)

($ Thousands)

FY 73 FY 74 FY 75 FY 76 FY 77 FY 78

459

TOTAL LONG RANGE

459 19,166

19,166

2,584

2,584

3,109

408

408

325 250

250

LOCATION-LINE ITEM

MARYLAND

Aberdeen Proving Ground

Academic Fac

MILITARY CONSTRUCTION PROGRAM COSTS

REQUIRED AS A RESULT OF CONUS REORGANIZATION AND REALIGNMENT ACTIONS

(Exclusive of Family Housing)

($ Thousands)

FY 73 FY 74 FY 75 FY 76 FY 77 F

d

Y 78

TOTAL LONG RANGE

7,200

7,200

fort Detrick

Admin Fac

Fort Meade

School Fac for Prep Sch

Admin Fac for Intel Cmd

MASSACHUSETTS

Fort Devens

Admin Fac Mod 1/

NEW JERSEY

Fort Dix

Admin Fac Mod 1/

700 1,521

1,521

2,221

1,242

1,242

LOCATION-LINE ITEM

NEW JERSEY (Cont'd)

Fort Monmouth

Academic/Admin Fac Mod

Convert Tng Fac to Admit

Convert Barracks to Admi

NEW YORK

Fort Hamilton/Fort Wadsw

MILITARY CONSTRUCTION PROGRAM COSTS

REQUIRED AS A RESULT OF CONUS REORGANIZATION AND REALIGNMENT ACTIONS

(Exclusive of Family Housing)

($ Thousands)

FY 73 FY 74 FY 75 FY 76 FY 77 FY 78

3,302

2,097

n 552

in 653

worth

1,700

700

1,700

Admin Fac Mod

Air-Cond Bldg

Sprinkler System

Barracks Mod

BOQ

Admin Fac Mod 1/

Seneca Army Depot

Admin Fac Mod 1/

NORTH CAROLINA

Fort Bragg

Admin Fac Mod (ROTC)

Admin Fac Mod 1/

1/ Army Readiness Regions & Readiness Groups

TOTAL LONG RANGE

3,302

2,579

MILITARY CONSTRUCTION PROGRAM COSTS

REQUIRED AS A RESULT OF CONUS REORGANIZATION AND REALIGNMENT ACTIONS

(Exclusive of Family Housing)

($ Thousands)

LOCATION-LINE ITEM

PENNSYLVANIA

Indiantown Gap Mil Reservation

Admin Mod 1/

TENNESSEE

Memphis Defense Depot

Medical Equip Maint Fac

Medical Storage Fac (DSA)

TEXAS

Fort Sam Houston

Admin Fac Mod (HSC)

FY 73 FY 74 FY 75

FY 76

FY 77 FY 78 TOTAL LONG RANGE

187 456

643

1,975

1,975

Dugway PG

Admin Fac Mod

1/ Army Readiness Regions & Readiness Groups

123

LOCATION-LINE ITEM

VIRGINIA

Fort Eustis

General Purpose Wareho

Co. Adm & Supply (2 ea)

Utilities Dist.

Utilities Expansion

Enlisted Men's Barracks

Enlisted Men's Barracks

Maintenance Repair Shop

Motor Pool

Gen. Service Maintenanc

MILITARY CONSTRUCTION PROGRAM COSTS

REQUIRED AS A RESULT OF CONUS REORGANIZATION AND REALIGNMENT ACTIONS

(Exclusive of Family Housing)

($ Thousands)

FY 73 FY 74 FY 75 FY 76 FY 77 FY 78

680 720 4,800 2,005 1,400

use

:e Shop

4,000

800

1,655

350

1,400

Fort Lee

Admin Fac

Fort Monroe

Mod Admin Fac

Headquarters Conversion (?RADOC)

WASHINGTON

Fort Lewis

Admin Fac for ROTC

8500 11,182 22,025 13,166

337

337

274 9,976

9,976

390

390

4,088 1,795 60,756 61,999

LONG RANGE

TOTAL

9,605

TOTAL

AT BASES WHICH WILL NOT BE

LOCATION - LINE ITEM

ALABAMA

Fort McClellan

BOQ

Academic Fac

ALASKA

N. Fort Wainwright

Air Pollution Control

Sewage Treatment

CALIFORNIA

Presidio of San Francisco

Admin Fac Headquarters Bldg

Opn Center

Map Depot

GEORGIA

Atlanta Army Depot

Incinerator

BOQ

Propane Peak Shaving Plant

Medical Maint Fac

MILITARY CONSTRUCTION PROGRAM PROPOSED

REQUIRED AS A RESULT OF CONUS REORGANIZATION AND REALIGNMENT ACTIONS

(Exclusive of Family Housing)

($ Thousands)

FY 73 FY 74 FY 75 FY 76 FY 77 FY 78 TOTAL

1,100 800

1,100

800

1,138 665

1,138

LONG RANGE

1,900

1,803

2,373

1,146

879

348

838 481

381

162

481

295

1,319

MILITARY CONSTRUCTION PROGRAM PROPOSED

AT BASES WHICH WILL NOT BE REQUIRED AS A RESULT OF CONUS REORGANIZATION AND REALIGNMENT ACTIONS

(Exclusive of Family Housing)

($ Thousands)

LOCATION - LINE ITEM

GEORGIA (Cont'd)

Fort Gordon

Barracks Complex

MP Academic Fac.

Bachelor Officer Quarters

Hunter AAF

Bachelor Housing

Gymnasium

Maint. Fac.

Fort McPherson

Headquarters Building (3d Army)

FY 73 FY 74 FY 75 FY 76 FY 77 FY 78 TOTAL LONG RANGE

9,659 2,052

2,052

9,659

980 12,691

980

ILLINOIS

Joliet

Air-Condition Admin Fac

Rock Island

Electric Distribution

Air-Condition Admin Fac

350

755 2,437

755

2,437

5,140

2,800

1,550

790

17,936

17,936

MILITARY CONSTRUCTION PROGRAM PROPOSED

AT BASES WHICH WILL NOT BE REQUIRED AS A RESULT OF CONUS REORGANIZATION AND REALIGNMENT ACTIONS

(Exclusive of Family Housing)

($ Thousands)

LOCATION - LINE ITEM FY 73 FY 74 FY 75 FY 76 FY 77 FY 78 TOTAL LONG RANGE

MARYLAND

Fort Holabird 2,247 806 234 896 4,183 1,562

Admin Fac Mod 206

Guest House 227

Library Addition 83

Gymnasium 579

NCO-Mess 896

Improve Elec Distribution Sys 692

Service Club 151

Post Headquarters 1,229 t

PM Admin Bldg 132 O

Relig Education Fac 201 O

Commo Imp 1,349

Fort Meade 2,070 2,070

WAC Barracks 2,070

NEW JERSEY

Fort Monmouth 7,331 2,223 1,680 11,234

Barracks Modernization 990

Consolidated Mess 2,404

Gen Purpose Warehouse 2,223

Consolidated Maint. Fac. 1,680

EW Barracks 2,399

EM Barracks 1,538

Picatinny Arsenal 433 433

BOQ 433

MILITARY CONSTRUCTION PROGRAM PROPOSED

AT BASES WHICH WILL NOT BE REQUIRED AS A RESULT OF CONUS REORGANIZATION AND REALIGNMENT ACTIONS

(Exclusive of Family Housing)

($ Thousands)

LOCATION - LINE ITEM FY 73 FY 74 FY 75 FY 76 FY 77 FY 78 TOTAL LONG RANGE

NEW YORK

Fort Hamilton 1,199 250 2,583 4,032

Admin Facility 520

BOQ 679

Guest House 250

EM Barracks 2,000

Academic Facility 583

OREGON

Umatilla Army Depot 235 332 567 4,292

Maint Bldg 235

Ammo Storage Bldg 332

Ammo Maint Bldg 2,387

Ammo LCL Bldg 613

Water Distribution System 330

Ammo Sup 284

Electric Firing System 50

Miss Opns Bldg 628

AT BASES WHI

LOCATION-LINE ITEM

TEXAS

Fort Wolters

Bachelor Officer Quarters

Commissary

Hospital Adm.

Misc. Projects

VIRGINIA

Fort Belvoir

Classrooms & USMA Prep Fac

Fort Monroe

HQ Conversion (CONARC)

Fort Story

Barracks

Gymnasium

Battalion Mess

Bachelor Officer Quarters

Amphibious Tng Fac.

Disp/Dental Clinic

Support Fac.

MILITARY CONSTRUCTION PROGRAM PROPOSED

CH WILL NOT BE REQUIRED AS A RESULT OF CONUS REORGANIZATION AND REALIGNMENT ACTIONS

(Exclusive of Family Housing)

($ Thousands)

FY 73 FY 74 FY 75 FY 76 FY 77 FY 78 TOTAL

3,000

3,000

1,099 2,310

1,099

6,409

LONG RANGE

22,700

2,310

22,700

5,682

5,682

6,350

6,350

628 869 1,165

869

1,165

628

5,682

9,012

9,834 19,666 16,285 10,972

9,976

9,976

5,186

2,055

770

2,361

71,602

TOTAL

5,683 62,440

LOCATION

ALABAMA

Ft. McClellan

GEORGIA

Ft. Benning

Ft. Stewart

ILLINOIS

Rock Island Arsenal

Ft. Sheridan

INDIANA

Ft. Ben Harrison

KANSAS

Ft. Leavenworth

Ft. Riley

KENTUCKY

Ft. Campbell

Lexington-Blue Grass

COSTS REQUIRED

FAMILY HOUSING PROGRAM COSTS REQUIRED AS A RESULT OF

CONUS REORGANIZATION AND REALIGNMENT ACTIONS

(AMOUNT IN THOUSANDS - UNITS IN PAREN)

FY 73 FY 74 FY 75 FY 76

4,380(150)

1,984(64)

2,047(59)

360(11)

1,457(47)

1,631(47)

7,183(207)

282(10)

FY 77

FY 78

5,633(172)

4,442(128)

6,766(195)

LOCATION

MARYLAND

Ft. Detrick

NEW JERSEY

Ft. Dix

Ft. Monmouth

NORTH CAROLINA

Ft. Bragg

SOUTH CAROLINA

Ft. Jackson

VIRGINIA

Ft. Eustis

TOTALS

COSTS REQUIRED

FAMILY HOUSING PROGRAM COSTS REQUIRED AS A RESULT OF

CONUS REORGANIZATION AND REALIGNMENT ACTIONS

(AMOUNT IN THOUSANDS - UNITS IN PAREN)

FY 73 FY 74 FY 75 FY 76

FY 77

FY 78

467(16)

1,839(53)

729(21)

3,330(114) 2,697(87)

426(13)

9,300(300)

8,469(290) 15,438(498)

625(18)

9,889(285)

6,419(196) 35,151(1,013)

LOCATION

ALABAMA

Ft. McClellan

Ft. Rucker

ARIZONA

Ft. Huachuca

COLORADO

Ft. Carson

(Incl ARADCOM)

GEORGIA

Ft. Gordon

MARYLAND

Ft. Meade

NEW JERSEY

Ft. Monmouth

Picatinny Arsenal

PENNSYLVANIA

Valley Forge

FY 73

COSTS AVOIDED

FAMILY HOUSING PROGRAM COSTS AVOIDED AS A RESULT OF

CONUS REORGANIZATION AND REALIGNMENT ACTIONS

(AMOUNT IN THOUSANDS - UNITS IN PAREN)

FY 74 FY 75 FY 76

3,366(97)

972(28)

590(17)

2,533(73)

5,256(180)

5,010(153)

2,650(100)

4,701(161)

694(20)

1,441(44)

FY 77

FY 78

LOCATION FY 73

TEXAS

Ft. Wolters

VIRGINIA

Ft. Belvoir

(Incl Wash Metro areas)

Ft. Monroe

Ft. Story

TOTALS

2,650(100)

COSTS AVOIDED

FAMILY HOUSING PROGRAM COSTS AVOIDED AS A RESULT OF

CONUS REORGANIZATION AND REALIGNMENT ACTIONS

(AMOUNT IN THOUSANDS - UNITS IN PAREN)

FY 74 FY 75 FY 76 FY 77

27,066(280)

14,400(491)

3,054(88)

8,650(279)

- 24,357(832) 8,650(279) 6,451(197)

FY 78

38,275(1,103)

240

BASE UTILIZATION MANAGEMENT BY THE ARMY

Mr. SIKES. In the Defense subcommittee's hearings with the Secre-

tary of the Army, I questioned the Army's capability in the area of

base utilization. Will you briefly describe how base realinement actions

are managed in the Army, and then tell us in greater detail in the

record how the Army's reorganization plan and the recent base closure

announcements were handled ?

General COOPER. Realinement proposals within the Army are usually

initiated to effect personnel or dollar savings or to improve efficiency in

carrying out Army missions. The proposals may be initiated by any

major command, such as Conarc, the U.S. Continental Army Com-

mand; Army Materiel Command; or any others, or by any element of

the Army Staff.

Proposals may also be initiated by the Office of the Secretary of

Defense or the Office of the Secretary of the Army or the Chief of Staff

of the Army.

Normally, specific proposals will be developed by the major com-

mand or Army staff agency which has primary staff responsibility for

the major functional activity involved in the realinement.

For example, in Army training centers, individual training comes

under our Deputy Chief of Staff for Personnel. Within the Army

staff, the development of these actions comes together within the Office

of the Chief of Staff of the Army for overall coordination, and this

office is therefore advised whenever a realinement possibility is iden-

ified for further study and analysis which may lead to an official

proposal.

I can provide more detail.

Mr. SIKES. For the record.

[The information follows:]

On January 11, 1973, the Secretary of the Army and the Chief of Staff an-

nounced a series of major management actions designed to modernize, reorient,

and streamline the Army's organization within the continental United States. On

April 17, 1973, the Secretary of Defense announced a number of facilities realine-

ment actions to scale down the Department of Defense base structure commen-

surate with reduced force levels and training requirements.

The reorganization of the Army is designed to improve readiness, training,

the materiel and equipment acquisition process, the quality and responsiveness

of management, and better support for the soldier in an era of constrained

personnel and budget resources. Although improved efficiency is the main pur-

pose of the Army reorganization, these management actions will also result in

reduced operating costs and manpower savings. The reorganization will be

essentially completed by December 31, 1973.

The detailed planning process which resulted in the reorganization was co-

ordinated closely with the Army's concurrent planning for base realinements

announced by the Secretary of Defense on April 17. The Army's base realine-

ment plan includes consolidation of service school activities, closure of one

general hospital, reduction of depot activities, and closure of bases for which

a need no longer exists.

These two actions are being carried out within the budget constraints of fiscal

year 1973-74 and when fully realized, total annual savings from these two

actions will be approximately $248 million, with over 21,000 manpower spaces

eliminated.

Mr. SIKES. Now tell us who actually has the responsibility for the

actions such as those recently taken in the base closure announcement.

Did you or Mr. Brazier have a part in them, or was it at another level?

General COOPER. We definitely had a part in them.

Mr. SIKES. Were you the people who decided what would be done ?

General COOPER. I did not make the final decision. We provided in-

formation and recommendations. We provided data.

In my particular case, as director of installations, we would tell

them what the facilities were and what the facility costs would be if

they made these changes.

General COOPER. Insofar as the installations are concerned, we

would provide an analysis just on that part.

Mr. SIKEs. Did you also make recommendations? I am not trying to

point a finger at anyone. This committee is interested in knowing who

does make the decisions on what bases can best be closed or left open.

General COOPER. Within the Army, the final decisions are really

made by the Chief of Staff and then by the Secretary of the Army.

These are very important decisions which are made-

Mr. SIKEs. Of course, they are important decisions, and we realize

they go to their level for final determination, but who are the action

people ? Who made the recommendations?

General COOPER. The recommendations are normally handled in the

Office of the Chief of Staff of the Army.

Mr. SIKES. Then what is it that you and Mr. Brazier do?

General COOPER. We provide information. We provide specific recom-

mendations with regard to specific bases. Then we participate in the

discussion when the final recommendations go forward.

In the final analysis, it is usually somebody from the Office of the

Chief of Staff of the Army who sits with the Chief of Staff and the

Secretary, and they go over this in some detail.

Mr. SIKES. From your offices, do the recommendations go directly

to the Chief of Staff and to the Secretary ?

General COOPER. No. They usually go to an element within the Office

of the Chief of Staff. There is an Assistant Vice Chief of Staff of the

Army who coordinates the staff effort. Within the Secretariat, ASA

(I. & L.) has the responsibility for coordinating the review.

Mr. SIKES. From your level, then, they would go to the Office of the

Assistant Vice Chief?

General COOPER. Yes, sir.

Mr. SIKES. Before they reach your level, whose hands do the recom-

mendations go through ?

General COOPER. At my particular level, they would go through Mr.

Lockwood, who is the division chief of the Installations Management

Division; but they also would go through the Army headquarters down

below the DA staff level, because we have to be sure we get their input,

also.

MISSIONS LOCATED AT SMALL INSTALLATIONS

Mr. SIKES. We find and we are somewhat puzzled by the fact that the

Army proposes to put additional missions at some installations which

are relatively small, and have rather poor and limited facilities, and are

relatively costly to operate and maintain. That includes places like Fort

Monroe, Fort MacArthur, Fort McPherson, Fort Sheridan, and Fort

McClellan. Why would you place additional missions at this type of

installation, rather than at the more modern, better developed

installations ?

General COOPER. In the case of Fort Monroe, for example, we placed

TRADOC there to avoid having the disruption of moving a lot of peo-

ple at the same time we were reorganizing the Army. We felt it was

better, in terms of our mission, to disrupt as few people as we could,

with the idea that we could go back and examine if Fort Monroe was

in fact the best place.

Mr. SIKEs. Are you inviting additional costs by doing this in that you

probably will have to improve and modernize the facilities?

General COOPER. Right now at Fort Monroe, for example, we are pro-

viding only a minimum amount of changes to those facilities to take

care of the short-term requirements. If we stayed at Fort Monroe for

10 years, we would have to provide quite a bit more facilities.

That is one of the factors we will consider when we review that par-

ticular aspect this calendar year.

BACKFILL OF FORT DIX

Mr. PATTEN. What is the total amount of permanent administrative

space at Fort Dix ?

General COOPER. About 150,000 square feet.

Mr. PATTEN. In the event the Army decides to phase out basic train-

ing at Fort Dix and backfill with other activities, what do your criteria

tell you about the types of activities which could be accommodated

here?

General COOPER. The nature of the facilities at Fort Dix which would

be vacated if we disestablished the Army Training Center is such that

they are considered ideal for troop intensive activities, with certain

limitations. Those limitations apply primarily to the training facili-

ties available for combat and combat support units.

For example, infantry, armor, or artillery battalion size or larger

units would not have sufficient maneuver area or adequate ranges for

the training they require.

The ATC facilities would be excellent for school-type training where

a large number of lower ranking enlisted men or women are trained,

because you would not have the family housing requirement.

We can very easily put activities back in to Fort Dix, but you would

soon run out of the 2,200 family housing.

You can, however, convert the barracks spaces to administrative

space. It would be expensive, but not nearly as expensive as building

brand-new administrative space.

We are considering all of these factors, including the availability

of civilian workforce, the effects of potential encroachment, and cost

savings.

The thing you would want to backfill with would be the same thing

that you took out.

Mr. PArTEN. How much of a factor is the work of the Air National

Guard, which I know uses the facility there, and the Reserves ? I know

persons who visit Fort Dix every Sunday. I think there are three

outfits. Maybe it is the National Guard rather than the Air Guard.

Whenever I went to Dix, it was always in connection, with one of

these other activities, and nothing is being said that Ihave heard about

whether these other functions are important.

General COOPER. With regard to the National Guard and the reserves

at Fort Dix, most of their training up until now has been on the week-

end. We are trying to look for something that would be there all dur-

ing the week, as opposed to just during the weekend.

As a matter of fact, we are examining how we train the National

Guard and Reserves to see if there is some way that we could train them

for a few weeks straight instead of just on the weekends. In that case,

we would use the facilities much more extensively by the National

Guard and Reserves than we have in the past.

REDUCTIONS AT FORT DIX AND FORT MEADE

Mr. PATTEN. Can you explain now why the Army proposes to reduce

headquarters and training functions at major installations such as

Fort Meade and Fort Dix?

General COOPER. Yes, sir.

The Army reduced its strength from the Vietnam high of 1.6 million

to 804,000 at the end of fiscal year 1974 that we talked about. The need

for a training base to train newly recruited soldiers also decreased.

As for the reductions at Fort Meade specifically, the Army reorga-

nization plan removes the Continental Army from the chain of com-

mand. We are trying to reduce the number of levels installations have

to go through. So, the Continental Army themselves, including the

Continental Army at Fort Meade, are being reduced to where they are

primarily taking care of the Reserves and National Guard, as opposed

to the specific training of what we call the STRAF units, Strategic

Army Force units.

These Continental Armies will assist the commander of FORSCOM

in particular, who will have the overall Reserve training, to supervise

and train just the Reserve components, not the Active Duty

components.

Since we have tightened the mission, we have reduced the size of

their staff.

Mr. PATtEN. This intrigues me, because I think in my short time in

Congress, in the past 10 years, we have thought of our area command

for the Army as being first at Governors Island. Then I believe we

had to contact Fort Wadsworth over at Staten Island. Then I have a

recollection somehow that we were tied in with Fort Hamilton, at

least on some things.

I was astonished when we found we were going down to Fort Meade;

and now to be told there is a further relocation makes me wonder.

General COOPER. We are reducing the number of headquarters

elements.

USE OF SMALL RATHER THAN LARGE BASES

Mr. PATTEN. Will you explain now, with reference to the criteria

which the Army has recently developed, why the Army proposes to

put additional missions at installations like Fort Monroe, Fort Mac-

Arthur, Fort McPherson, Fort Sheridan, and Fort McClellan, all of

which certainly are relatively deficient in facilities and size as com-

pared to Dix or Meade and all of which have rather poor and limited

facilities, and are expensive to operate and maintain ?

General COOPER. Some of those new missions are basically small.

In some cases, for example, you had to station the Reserve region

units in areas where the Reserves are.

At Fort MacArthur, for example, we established one of the RR's.

It is a small post, but it is the only one we have in southern California.

That is the reason for some of those minor missions.

At Fort Sheridan, for another example, we established a Reserve

readiness region. Here again, we have lots of Reserve units and Na-

tional Guard units in the Chicago area.

I will address the question of TRADOC being established at Fort

Monroe. That had to do with the fact that most of the people who will

be in the Training and Doctrines Command, not all of them, were al-

ready located at Fort Monroe. We are trying to get the new reorganiza-

tion of the Army off to a good start, and we did not want to move all

those people to some other post at the same time we reorganized them

in a new mission.

Mr. PATTEN. Was that justification for moving what you have at

Hampton, Va., over to Fort Sheridan; 6,000 people?

General COOPER. You mean the U.S. Army Recruiting Command?

Mr. PATEN. We moved the factory out of Springfield, Mass., to

Fort Sheridan. I do not have to tell you they never convinced me on

that and I listened and listened.

General COOPER. The Recruiting Command was in relatively poor

facilities in the Norfolk area. There were reasonably good facilities

at Sheridan. Also, Sheridan is in the geographical center of the

United States, where we wanted the Recruiting Command sta-

tioned. Those were the two main reasons for moving the Recruiting

Command.

COMPLETION OF FORT DIX STUDY

Mr. PATTEN. When do you expect the Army to complete its study

on Fort Dix? Maybe it has already been completed.

General COOPER. On Fort Dix, it is not completed. We are required

to have it to the Secretary of Defense by July 1.

Mr. PATTEN. I do not have to tell you that we phased out two instal-

lations in my county. I urged them to leave. I was the only one in

public life who did.

Of course, Kilmer was easy.

Now there is the most beautiful complex you ever saw, just one-

third of it-a medical school, a dental school, a pharmacy school, a

medical library, 20,000 students. More people are working on 500

acres which were turned over to industry than Kilmer ever had under

the Army.

When everybody was crying and opposing the close-down of

Raritan Arsenal about 1962, I said, "Let's get rid of it," but on other

grounds.

They were down to about 1,100 workers. There are now an estimated

20,000 people working at Raritan Arsenal. On a Friday afternoon, I

went over there and addressed the Middlesex County Community Col-

lege. They have 7,000 students at the old Raritan Arsenal.

That is not the whole story. That is just part of it. In retrospect,

the transformation at Raritan Arsenal was beneficial in the long run,

although many persons lost their jobs.

What we can do with 32,000 acres at Dix, believe me, would mean

so much to our State, but you do have other factors. They tell me there

are 55,000 retirees in that Dix section, all as a result of Camp Dix over

the years. They bought their homes there, figuring they would get the

hospital service and things of that type.

Congressman Forsythe said there are 55,000 retirees in that area,

civilian and military. I 'am told that with light industries, if you re-

duced the basic training, even, at Dix, it would create unemployment

of 6,000 in the camp, but in the community another 9,000.

We met with the Secretary on this. At lot of statistics were given.

Frankly, as a piece of real estate, the way our State is growing so

rapidly, we can do a great deal more economically with Camp Dix

and that 32,000 acres than the Army is doing.

But as an American, I just cannot understand how, for the whole

Northeast part of the United States, you ever hope again to get any-

thing the size of Dix if you needed it.

COMPLETION OF SMALLER BASES STUDY

When do you expect the Army will complete its study of the long-

range utilization of its smaller installations?

General COOPER. We expect to have the study completed by the end

of this calendar year, not just the small ones, but we are reviewing

all the installations, including the depots and activities like that, in the

Army Materiel Command.

We do expect to have inputs from that study in time to influence

our fiscal year 1975 budget submission.

Mr. PATTEN. You never said a word, that I recall, in your criteria

about weapons or artillery at Dix., in basic training.

In your talk about Dix in particular, have you ever said anything

about a change in our artillery, or the armament, or the training itself.

that required a larger buffer area or greater care so we do not have

something like happened in California, a couple of weeks ago? We

had that at my area. We have the Navy loading station. When the

explosion occurred, every window in my house was knocked out; my

front door was flattened.

Is there anything in the Camp Dix criteria which brings in the

question of the explosives of weapons ? While Dix may have been

appropriate in 1917 for the World War I Army, today it is a different

ball game.

You did not mention, nor did I hear anyone else mention, the type

of armament, artillery practice, of which we had plenty at Dix in our

time. No one mentioned those factors.

General COOPER. I did mention, in talking about what type of units

we might backfill into Dix, if we closed down the training center, that

we could not use artillery units and infantry units because you do not

have enough maneuver area and you do not have artillery ranges.

Mr. PATTEN. But we did in 1917.

General COOPER. That is right. You did not have as long range artil-

lery. I am not sure what kind of buffer zones they had in 1917. Clearly,

we could not get additional buffer zones now.

Mr. PATTEN. You are not using the same artillery, are you?

General COOPER. That is right.

Mr. PATTEN. I know the answer insofar as what you could do in

1942. You probably need a little more room today, at Fort Dix or any

other place.

General COOPER. We certainly do.

Mr. SIKEs. Are there further questions at this point?

[No response.]

CONSTRUCTION MANAGEMENT

Mr. SIKES. Tell me what steps the Army has taken to improve its

execution of the construction program.

General COOPER. First of all, we are taking steps to assure that firm

functional requirements for projects are obtained, and design initiated

earlier. This insures that a better estimate based on firm criteria will

be included.in the budget, and that construction can start as soon as

funds become available.

For example, we are now moving forward on the design of much of

our fiscal year 1975 medical program. We are also increasing our use

of special network analysis to analyze scheduling problems and bring

them to the attention of top management.

We are continuing to use life cycle cost studies, value engineering,

and improved contractor quality control.

For our major new barracks program we erected a- full-size mock-

up of our design, which you saw pictures of this morning, to enable

the architect-engineer to refine the design and eliminate the bugs.

In addition, the model was used to obtain user reaction and allow

designers to develop furnishings and color schemes. We plan on con-

tinuing to utilize this new design.

However, to insure we do not overlook any opportunities for cost

reduction, we are continuing a full-value engineering study of the

project and we will use this experience in the construction of the first

major projects. We have also initiated this year special construction

management inspection teams to review all large medical and barracks

modernization projects.

These teams are reviewing all ongoing projects as well as recently

completed projects, to be sure that full advantage is obtained from the

experience on all the projects and that the problem areas are avoided

wherever possible.

The medical teams include representatives of the Surgeon General

as well as experts in medical facilities, construction, maintenance

operation.

We are also continuing to evaluate all promising modes of procure-

ment which offer the possibility of reducing costs.

One of these had been industrialized methods of construction, but

we recently were told that the industrialized method used in fiscal

year 1972 was not acceptable for 1973. That was told to me this morn-

ing.

CONSTRUCTION ENGINEERING RESEARCH LABORATORY

Construction Engineering Research Laboratory has inventoried and

established the data bank of manufacturer designers and users, so we

do not redesign the same thing. We have completed a study of com-

puter-aided design evaluation and actually are using this output in

developing two projects in our fiscal 1974 program.

Mr. SIKES. Last year we discussed the Corps of Engineers laboratory

at Champaign-Urbana, Ill. How important has that been in your

work ?

General COOPER. I would like to give you a few recent examples

where it has helped us quite a bit. It actually works in all areas. One

is in the fibrous concrete; CERL has extended and made practical for

construction use a material known as fibrous concrete. We had the

initial development of this under National Science Foundation grant.

CERL successfully applied it as a practical paving material; because

of its strengths in all directions, fibrous pavements .are often half as

thick as conventional concrete, with greater crack resistance, longer

life, and less maintenance cost.

We have also used them in the pollution abatement cost savings.

Major study was done by CERL for the Mobile district of the corps

to find the most effective process for treating liquid wastes and air pol-

lutants from the Holston Army plant. This study resulted in solutions

to the problems which cost $3.5 million less in construction costs and

designs proposed before CERL got involved. The new design will meet

the current anticipated environmental requirements.

I am not sure whether it will meet the new ones which will call for

zero pollutant discharge by 1985 as part of the Federal Water Pollu-

tion Control Act amendments of 1972.

They are also involved in the habitability research. CERL studies of

dining halls at Fort Lewis, Wash., not too surprisingly, linked a sol-

dier's satisfaction with his food service to the influence of the func-

tional arrangement and decor. Restaurants have known this for a long

time.

I am not sure we had to have a specific study, but it helps. We have

had as a result the decor catalog for dining facilities which we dis-

tribute Army-wide under the auspices of the Troop Support Agency

to help the commanders decorate dining halls. CERL is also doing

studies on occupant desires for the family quarters and barracks.

CERL has developed an Automated Construction Progress Reporting

System for corpswide use that reduces the variety of report forms by

60 percent and man-hours required for reporting by 50 percent.

Mr. SIKES. I am glad you seem to be getting some significant results.

RATE CHARGED FOR SUPERVISION, INSPECTION, AND OVERHEAD

What rate is the Crops of Engineers charging for supervision, con-

struction, and overhead at the present time?

Do you expect this to go up or down?

General COOPER. Last year the rate for supervision and inspection

was reduced for the ninth time since 1963. As of July 1, 1972, the rate

was set at 5 percent. At this time we do not anticipate any change in

the rate, however, it will be reviewed again at the close of this fiscal

year.

PRIOR-YEAR CONTRACT AWARDS

Mr. SIKES. What success have you had in awarding prior-year pro-

grams for military construction and family housing ?

General COOPER. At this time all of tlhe fiscal year 1972 and prior

MCA programs have been awarded with the exception of approxi-

mately $82 million. Over $60 million of this amount is for pollution

abatement projects which have encountered numerous delays due to

changing satndards, awaiting connection to regional systems and tech-

nical investigations. Many of these problems are now well on the way

to solution so that we anticipate improved progress in this area. Ap-

proximately one-third of the fiscal year 1973 MCA program is now

under contract and we anticipate that at least 60 percent of the fiscal

year 1973 funds will be obligated by the end of the fiscal year. While

the rapid cost growth is creating problems, we hope to successfully

accomplish the authorized program.

The Army has awarded all of its family housing projects through

the fiscal year 1971 program, all projects in the fiscal year 1972 pro-

gram have been awarded except three projects; Camp Drum 88 units,

Carlisle Baracks 60 units and the Grand Forks Safeguard site proj-

ect of 90 units. We are in the final stage of awarding the Camp Drum

project. We will not be able to award the Carlisle Barracks and the

Grand Forks projects and still maintain the $24,000 statutory limita-

tion. Construction costs in both these areas are extremely high and bids

received on these projects were not responsive and precluded award

within the statutory limitation. Advertising of four low-cost projects

to start the fiscal year 1973 program is scheduled the latter part of this

month of May 1973.

UNOBLIGATED BALANCES

Mr. SIKES. Provide for the record a breakdown of the unobligated

balances in military construction, Army.

[The information follows:]

(In millions of dollars]

Actual as of Estimated as

March 31, of June 30,

1973 1973

Major construction------------------------------------------------....................................-----...... 531.3 310. 4

Planning..........---------------------.........................-------------------------------------- 17.0 5. 3

Minor construction.............----------------------------............................. -------------------------- 8.3 4.2

NATO infrastructure .................. .____ ___ ._ _-_-_.....:... ___ _ - 18.2 12.9

Supporting activities.................. -............... ..... ...... ......... 1.4 0.9

Safeguard.--------------..................... 132.0 184.2

Construction----------------------- ... ........---------------------------........ 103.1 168.1

Planning----......---.......... .............---------------------------------------------.. 14.8 6.0

Access roads.....-----...---... -------------------------------------------------- 5. 2 4.0

Community impactassistance .------...........--- .. ............. --------8.9 6.1

Applied to fiscal year 1974 program .... ..... ____....... ... __....... ............ 22.0 22.0

Total...----------------..........-----------------------------------------. 730.2 429.9

I Includes reprograming of Safeguard funds for NATO increased costs resulting from currency revaluations ($20.6 mil-

ion) not approved as of Mar. 31, 1973.

TURNKEY

Mr. SIKES. Now, the Army has made substantially less use of turn-

key for the construction of family housing than have the other serv-

ices. Is there any particular reason for that?

General COOPER. We have made some. How much less is a ques-

tion-maybe we are more conservative. But let me tell you where

we are now with regard to turnkey.

Specifically, we had two projects in the 1971 family housing, six

projects in 1972. In the 1973 program, almost all of our projects

will be turnkey with the exception we have two in Nome, Alaska,

two in Bethel, Alaska.

249

Mr. SIKEs. You are planning to make greater use of it?

General COOPER. Yes, sir, and all in 1974 are expected to be turnkey.

STATUTORY COST LIMIT-FAMILY HOUSING

Mr. SIKES. All right. Tell us something about the problems you

have had with statutory cost limits for family housing?

General COOPER. In the past years we designed and constructed

family housing to the dollar limitation contained in the authorization

law. But with the sharp increases in labor and materials cost, the

quality of the family housing declined and the statutory average

unit cost has not been sufficient to permit construction of fully adequate

family housing.

Mr. SIKES. Are you proposing an increase?

General COOPER. Yes, sir. We have asked this year to go to $27,500

for CONUS.

Mr. SIKES. From $24,500 ?

General COOPER. From $24,000 even, I believe it was in 1973, and it

was the same in 1972.

Mr. SIXES. Considering inflation, will that give you housing as good

as that which you have been getting for $24,000?

General COOPER. Yes, sir.

Mr. SIKES. Will it be better housing ?

General COOPER. Well, slightly better, but the cost of inflation is

almost 10 percent. Ten percent of $24,000 gets you up to $26,400 al-

ready. It was actually a little more than 10 percent. So it is just mar-

ginally better than what we got for $24,000, particularly when you

remember we had no increase from 1972 to 1973.

SECTION 236 HOUSING

Mr. SIgES. What is the status of the Army's portion of the military

setaside section 236 housing program ?

General COOPER. On the 236 we accepted or the Department of Hous-

ing and Urban Development accepted a total of 2,250 units in 1971

and 1972 for development of housing near Army installations. At the

present time we have 900 units at three of these installations, 300 at

Fort Meade, 400 at Carson, and 200 in Hawaii, occupied or almost com-

pleted and ready for occupancy.

Two hundred additional units at two installations, 100 units at Fort

Ord and 100 units at Fort Richardson, are under construction. A 100-

unit project at Fort Belvoir has been approved for construction; nine

other projects which comprise about half the program, 1,050 units,

were in various stages of development by FHA.

Mr. SIKES. Let me interrupt for just a moment.

I have found quite a number of post commanders, and my experience

has not been limited to the Army, who know nothing about the section

236 set-aside. I would have thought that all of them would have been

alerted to its possibilities so that they could take advantage of it for

their lower grade enlisted personnel who have families.

General COOPER. The Army, based on submissions by the--

Mr. SIXES. Off the record.

[Discussion off the record.]

Mr. SIKEs. If they have not been notified, please do so.

We also want to discuss the changes necessary in order to continue

the benefits from this program.

Mr. PATTEN. If the administration continues the program.

Mr. SIKES. That is a good point.

General COOPER. May I finish the answer to the previous question?

Nine other projects were in various stages of development by the FHA.

These projects have been deferred by the Secretary of the Department

of Housing and Urban Development, who placed a moratorium on

federally-subsidized housing projects on January 8, 1973. That

amounted to 1,050 units.

SUGGESTED LEGISLATION FOR HUD SUPPORTED HOUSING

Mr. PATTEN. What would you propose in the way of corrective

legislation ?

General COOPER. I have considered this particular problem, because

at Fort Carson there was a real issue, where we had some houses being

built but, because of the pay raises, the people for whom they were

being built no longer qualified. We got an exception to the policy from

the Housing and Urban Development people. But we are considering-

this has to be subject to the Office of Secretary of Defense approving

it-trying to place the housing eligibility on the basis of the grade of

the soldier.

Right now we cannot practically program housing for E-4's nor can

build any for E-1's, E-2's and E-3's. If we could get the legislation

written based on the grade of the lower grade enlisted men, we would

then be able to start a program, without worrying about changes in the

pay.

We still have the problem of the fact that the 236 housing units are

all under a moratorium, you understand.

Mr. PATTEN. This would be welcomed by a great many, if we could

get the legislation ?

General COOPER. Yes, sir.

We have a very real problem of the many young people coming

into the Army now, particularly at Fort Carson, where a greater per-

centage are married than had been in the past. These people do not

qualify for family housing. It gets to be very difficult. They cannot

really afford it in the community.

Mr. PATTEN. General, fresh out of the office, Saturday morning, an

old man came in-I can give you his name and address-they raised his

rent $50 to $176. He only has $136 a month coming in on social security.

He was in tears.

Another woman, who is over 70, came in with the same situation.

Housing and rent increases in my little town are by far the biggest

crisis. There is nothing you can do about it. So I know.

One of the best arguments around our way for the benefits of being

in the U.S. Army is the housing. It is very definitely of interest to these

young married couples what you do in the way of housing. That will

be one of the main pillars of your Voluntary Army concept, or at least

one of your main selling points.

CONSTRUCTION COST INCREASES

What has been the Army's experience with construction cost in-

creases in the past year ?

General COOPER. In the past calendar year 1972, it was 9 percent.

Mr. PATTrEN. What cost escalation factor have you included in your

fiscal year 1974 estimates and to what point in time are you projecting

these costs ?

General COOPER. The cost escalation rates used 61/2 percent for cal-

endar year 1973, 6 percent for calendar year 1974, and 6 percent per

year for projections beyond 1974.

What we do is, we analyze each project at the engineer district to

determine the construction time and the escalation rates are then

applied to the midpoint of the estimated construction period. In other

words, we do it the same as we would expect a bidder to do it.

These costs and time projections are reviewed for accuracy and rea-

sonableness at the Department of Army level.

Mr. PATTEN. In view of your success in awarding contracts, are you

being overgenerous?

General COOPER. No; we are not really putting enough in, because

the current projected estimate of inflation for building in calendar

year 1973 by the Engineering-News Record is 10.6 percent. We have

allowed in these estimates only 61/2 percent.

Mr. PATTEN. Especially if lumber isi factor.

General COOPER. The cost of lumber has had one beneficial effect

in that for a lot of the temporary buildings that we could not get

anybody to bid on to tear down, people are now bidding and paying

us because the lumber has gone up sufficiently in value. So everything

is not bad in this world.

Mr. PATTEN. I do not know about World War II lumber. I do not

know if you would get much for that today.

General COOPER. Some of the lumber in World War II was very

good and some of it was very poor. It was whatever they had available.

Mr. PATTEN. The weather has eaten right through the old Camp

Kilmer barracks. I know those were put up in haste with green lum-

ber, very thin, on a 5-year use basis.

Mr. BRAZIER. It is no longer green now.

Mr. PATTEN. There are a series of tables, charts, and so forth, which

should be inserted in the record at this point. They are: The current

and projected Army training workloads, including pilots and basic

training, broken down by training center; a listing of all construc-

tion contracts awarded in the past year on other than a competitive

bid basis; a listing of all guest house construction planned in the next

year. Also show the nonappropriated fund projects accomplished in

the past year, the major ones; a list of all minor construction projects

awarded in the past year or currently pending approval by the Army;

a listing of all facilities constructed with research and development,

working fund, or procurement money, other than at Government-

owned contractor-operated plants; a listing of any construction in

Vietnam performed in the past year or pending approval.

General COOPER. We will.

252

[The information follows:]

ARMY TRAINING WORKLOADS

The Army's current and projected workload for initial entry helicopter pilot

training is depicted below :

Production

Estimated Estimated

fiscal ear3 fiscal y9:

U.S. Army..------............---------------------------------------------------- 856 915

USAF.. ...-----------..............--------------------------------------------------- 225 75

USARING.-----......................--------------------------------... ----------------------- 113 200

FMT ---------------------------------------------------.....------------ 98 47

Total------------..--------------........-------.......---- ------------------ 1,292 1,237

I Foreign military training.

In addition, it is estimated that 2,870 pilots in fiscal year 1973, and 2,162

pilots in fiscal year 1974, will receive advanced skill- (graduate) flight training.

The term, production, as used in the table above indicates the number of indi-

viduals who are estimated to complete the course during the fiscal year. Another

measure of training facility workload is the number of students which must be

accommodated at any one time.

Student workload

Estimated Estimated

fiscal ear fiscal yer

Initial entry-------...---.....--...........................................------------------------------------------........... 1,014 1,072

Graduate ............................................................. ----------------------------------------------------------351 324

Total..............-------------------............--------------------------------------. 1,365 1,396

I All helicopters.

s Includes some fixed-wing training.

CURRENT AND PROJECTED ARMY TRAINING CENTER WORKLOADS

Average load,

Installation Fiscal a; Fiscal

Fort Dix.....----------------------- ------------------------------------ 10,500 9,400

Fort Knox....--------------------------------------------------------- 11,140 10,040

Fort Jackson......----..........-------------------------------------------- -------- 12 650 11,400

Fort Gordon-----------.. ----------------------------------- -------- 2300 2,100

Fort McClellan....---- ---------------------------------------------- 2,110 2,360

Fort Sill----. 2,100 2,000

Fort Bliss --------- - ------------------------------ 1,200 1.100

Fort Sam Houston... ---------------------------------------------------- 2,700 2,300

Fort Polk----. --------------------------- 14,100 12 700

Fort Leonard Wood---- ----......... . . . 12, 200 11i 000

Fort Ord ---...... 12,600 11,300

Total ....--- ---------------------------------------------- 83,600 75,700

' Includes both basic training and advanced individual training loads.

s Includes ROTC basic summer camp.

CONSTRUCTION CONTRACTS AWARDED BY ARMY ON OTHER THAN COMPETITIVE BID BASIS

DEP ITm1F OP THE ANMY

REPORT REQUIRED BY SECTION 704 OF PUBLIC LAW 92-145 COVERING MILITARY CONSTRUCTION COmrRACTS

AWARDED WITHOUT FORMAL ADVERTISING WRING THE SIX-MONTH PERIOD FRCH 1 JULY 1971 TO 31 DECEMBER 1971

Name of

Company With

Which Contract

Was Placed

Process Plants Corp.

College Point, N. Y.

Location of Work

Ft. George G.

Meade, Maryland

Description of Public Law

Military Construction Which Authorized

Provided by This Milltary

Contract Construction

Classified Waste 91-142

Destructor Fac.

including utilities &

connections

Dollar Amount

of Contract

(Gr Contract

Modification)

$ - 1,157,500

Reason Why Contract Was Awarde

Without Formnl Advertiser>nt

Contract negotiated in accordance with

provisions of 10 U.S.C. 2304(a)(10).

Construction for which it was impracti-

cable to secure competition by formal

advertising as adequate plans and speci-

fications were not available. Competi-

tive price proposals solicited.

Peter Kiewit Sons'

Co. & Associates

Omaha, Nebraska

Leavesley Industries,

Jacksonville, Texas

P.G.&E. Co.,

San Francisco,

California

Gehlen-Bau GmbH

Frankfurt, Germany

Gerhard Huebsch

Bischofsheim,

Germany

Vicinity of Letter Contract for

Conrad, Montana mobilization and

preparatory work -

Phase II Malmstrom

MSR & PAR SAFEGUARD

Facilities

'ackland AFB,

San Anronio, Tex

Two Incinerators

Tracy Defense Relocation of Sub-

Depct, California Station and 60 KV

Line

Frankfurt,

Germany

Renovation of Junior

High School

91-441

91-511

91-511

91-142

Ekstein, Germany Facility Improvement 90-408

Comm Site Eckstein

$ 50,000,000 Contract negotiated in accordance with

provisions of 10 U.S.C. 2304(a)(15).

Bids received under formal advertising

were unreasonable. A letter contract

was awarded in December 1971 in order to

allow work to start pending completion of

negotiations. Competitive price proposals

solicited.

$ 24,399 Contract negotiated in accordance with

provisions of 10 U.S.C. 2304(a)(10).

Impracticable to obtain competition

because only one proposal was received

under Step I of the two-step formal

advertising procedure.

$ 51,100 Contract Negotiated in accordance with

provisions of 10 U.S.C. 2304(a)(10)

because the contractor is the sole source

of supply.

$ 242,866 Contract negotiated in accordance with

provisions of 10 U.S.C. 2304(a)(6) for

property or services to be procured out-

side the United States and possessions.

Competitive price proposals solicited.

$ 106,874 Contract negotiated in accordance with

provisions of 10 U.S.C. 2304(a)(6) for

property or services to be procured out-

side the United States and possessions.

Competitive price proposals solicited.

Name of

Company With

W hch Contract

Was Placed

PREUSSAG

Darmstadt, Germany

Brown, Boveri & Cie AG

Trier, Germany

Gerhard Huebsch

Bischofsheim, Germany

M.F. Wachter KG

Stuttgart, Germany

Held & Francke

Vilshofen/Ndb, Germany

Leonhard Baumann'

Kaiserslautern, Germany

MAX JORDAN

Mannheim, Germany

Josef Fischer

Regensburg, Germany

Josef Fischer

Regensburg, Germany

Federal Republic of

qermany

Same as above.

Wolf & Sofsky

Zweibruckern, Germany

Leonhard Baumann

Kaiserslautern, Germany

Location of Work

Schweinfurt,

Germany

Bauaholder,.

Germany

Heidelberg,

Germany

Gablingen,

Germany

Eckstein,

Germany

Main, Germany

Mannheim,

Germany

Schwabach,

Germany

Fuarth, Germany

Bitburg, Germany

Hahn, Germany

Zweibruckern,

Garmany

Hahn, Germany

Description of Public Law

Htlitary Construction Which Authorized

Provided by This liilitary

Contract Construction

Expand Water Supply 91-511

Enlargement of Existing 92-145

Transformer Station

Boiler Replacement & 91-142

fuel oil storage for

heating plant-USAREUR

Cond Center

AUTODIN Switch Installa-91-511

tion ASA Location 300

Area 'V"

Facility Improvement 90-408

Comm Site Eckstein

Phase II & Section B

of Phase I

Extension of Elementary 91-511

School

Alter Bldg 49 90-408

Coleman Bks.

Constr of Hardstands 91-511

and Washrack

Constr of Hardstands 91-511

and Washrack

LOX Plnt

LOX Plant

Constr of Bachelor

Officers' Qtrs.

Hazard Cargo Pad

89-568

89-568

91-511

91-511

Dollar Amount

of Contract

(Or Contract

Modification)

$ 112,669

$ 10,515

$ 42,852

Reason Why Contract Was Awarded

Without Formal Advertisement

Same as above.

Same as above.

Same as above.

$ 355,163 Same as above.

$ 28,614 Same as above.

488,621

107,890

63,554

60,241

198,107

265,287

410,571

308,225

Same as above.

Same as above.

Same as above.

Contract negotiated in accordance with

provisions of 10 U.S.C. 2304(a)(6) for

property or services to be procured out-

side the United States and possessions.

Competitive price proposals solicited.

Same as above.

Same as above.

Same as above.

Same as above.

Kance of

Company With

Which Contract

Wa: Placed

Hunmmel & Baumann

Kaiserslautern, Germany

Same as above.

Josef Fandel

Bitburg, Germany

Same as above

Federal Republic of

Germany

Ed. Armbruster

Mannheim, Germany

Leonhard Baumann

Kaiserslautern, Germany

Josef Fandel u.

Soehne

Bitburg/Eifel, Germany

Westphal GmbH

Neu-Isenburg, Germany

Heinrich Koppers

Essen, Germany

Adolf Lupp KG

Hessen, Germany

Dipl. Ing. Leonhard

Baumann - Frankfurt,

Germany

Firma Karl Doll

Stuttgart, Germany

Location of Work

Zweibruecken,

Germany

Ramstein, Germany

Rahn, Germany

Bitburg, Germany

Ramstein, Germany

Feldberg/Taunus,

Germany

Ramstein Air Base

Germany

Schoenfeld,

Germany

Bamberg, Germany

Germershem,

Germany

Buedingen,

Germany

Friedberg/Hess.

Germany

Grafenvoehr,

Germany

Description of

Military Construction

Provided by

Contract

TAB VEE Aircraft

Shelters Cable System

TAB VEE Aircraft

Shelters Cable System

TAB VEE Aircraft

Shelters Cable System

TAB VEE Aircraft

Shelters Cable System

Water Retain Basin

Constr of Emergency

Power Plant

Constr of Helicopter

Hangar

Constr of Emergency

Power Station

Central Heating Bldg

7095 Warner Bks

Constr of Water

Supply System for

Germershem - Water

tour - Potable "

Flood Control US Army

Airfield

Constr of Tank Repair

Shop-RAy Bks

Heating and Latrines

Public Law

Which Authorized

This Military

Construction

91-142

91-142

91-142

91-142

90-408

89-188

91-142

89-188

91-511

91-110

89-188

91-511

91-142

Dollar Amount

of Contract

(Or Contract

Modification)

$ 11,298

$ 13,980

$ 10,164

$ 15,896

$ 314,338

$ 243,373

395,566

206,717

45,180

182,303

161,797

314,286

Reason Why Contract Was Awarded

Without Forral Advertisement

Same as above.

Same as above.

Same as above.

Same as above.

Same as above.

Contract negotiated in accordance with

provisions of 10 U.S.C. 2304(a)(6) for

property or services to be procured out-

side the United States and possessions.

Competitive price proposals solicited.

Same as above.

Same as above.

Same as above.

Same as above.

Same as above.

$ 263,518 Same as above.

N :ae of

Company With

Which Contract

Was Flaced

Klee KG

Ilvesheim b., Mannheim,

Germany

Dilp. Ing Leonhard

Baumann - Frankfurt,

Germany

Gabriele Pollera

Asmara, Ethiopia

Pierfrancesco Murino

Rome, Italy

I. STIVIS-D. SFIRIS

Ti Theofilides

Athens, Greece

Marwais International

Luxembourg G.D.

Fratelli Stimamiglio

Medioli Di E6G Medioli

Parma, Italy

Ari Insaat A.S.

Instanbul, Turkey

G.E.T.E.M.

Athens, Greece

Federal Republic of

Germany

Same as above

Location of Work

Frankfurt,

Germany

Frankfurt,

Germany

Description of Public Law

Military Construction Which Authorized

Provided by This Military

Contract Construction

Rehab of 97th Gen

Hospital

91-142

Alter of Bldg. 272 90-408

USAREUR Crime Lab

Asmara, Extension of Water 88-174

Ethiopia Supply Line

Montevergine Addition to Tech 91-142

Avellino, Italy Control Facility & 90-408

Autodin D.S.T.E.

Athens, Greece Construction of Cold 90-408

Storage, Auto Main-

tenance Shop, Dormitory

and Dining Hall

Aviano Air Base Installation of front 91-142

Italy closures, (TAB VEE)

Aircraft Shelters

Aviano A.B. Construction of Photo 90-408

Italy Lab. Base

Aviano A.B. TAB VEE Phase IlIa 91-142

Italy Aircraft Shelters

Incirlik A.B. MCAP FY 65, 66, 68 & 89-568

Turkey 69 Facilities

Athenai A.B. Const. Power Improve 89-568

Athens, Greece & Power Plant Addition

Ramatein Air Base, Aerial Port Facility 90-408

Germany

Miesau, Germany Controlled Humidity 90-408

Storage Warehouse

Dollar Amount

of Contract

(Or Contract

Modification)

$ 1,497,008

Reason Why Contract Was Awarded

Without Formal Advertisement

Same as above.

$ 78,550 Contract negotiated in accordance with

provisions of 10 U.S.C. 2304(a)(6) for

property or services to be procured out-

side the United States and possessions.

Competitive price proposals solicited.

$ 74,673 Same as above.

$ 104,180 Same as above.

$ 520,000 Same as above.

$ 239,100 Contract negotiated in accordance with

provisions of 10 U.S.C. 2304(a)(6) for

property or services to be procured out-

side the United States and possessions.

$ 13,291 Modification to a previous contract

which was awarded with price proposals

solicited.

$ 32,154 Same as above.

$ 13,179 Same as above.

$ 12,800 Modification to a previous contract which

was awarded with price proposals soli-

cited.

$ 517,967 Same as above.

$ 13,604 Same as above.

h ea of

Company With

Which Cract

Was Placd

Same as above

Same as above

Same as above

Same as above

Same as above

M.F. Wachter KG

Stuttgart, Germany

Josef Fischer

Regensburg, Germany

Montagegesellshaft

Frankfurt/Main, Germany

M.F. WACHTER

Stuttgart, Germany

Marwais Steel Co.

California, USA

Max Jordan Bau KG

Mannheim, Germany

Helde & Francke

Mainz/Rhein, Germany

Eduart Armbruater

Kaiserslautern, Germany

Wolf & Sofsky

Zweibruecken, Germany

Location of Work

Germany & Holland

Germany

Bitburg, Germany

Kaiserslautern,

Germany

Haustadt, Germany

Mannheim, Germany

Gablingen

Cermany

Hohenfels,

Germany

Schweinfurt,

Germany

Gablingen -

Augsburg, Germany

Spangdahlem,

Ramstein, Hahn

& Bitburg, Germany

Germersheim,

Germany

Mains, Germany

Description of

Mnlltary Construction

Provided by

Contract

Aircraft Shelters

Public Law

Which Authorised

This Military

Construction

90-408

Approach Lighting 91-142

Command Stock Storage 90-408

Warehouse

12 Ammo Storage Igloos 89-367

Controlled Humidity 90-408

Storage

Army Security Agency 90-408

Facility

Storage Facilities 90-408

Heating Plants Exten- 91-511

sion Bldg.

Constr of 1,000 man 91-142

mess-hall-Gablingen

Kaserne

Delivery and 90-408

Installation of 10

Aircraft Shelter

Closures, w/Integrated

Support systems

Constr of Equipment 90-110

Washing Facility

Alteration and Rehab 91-142

of 5 Spray booths &

Constr of New Paint

Bldg.

Misesau, Cermany Ccnstr of Ano Renova- 89-367

tion Shop & Heating

Plant

Zweibruecken, Constr of Bachelor 91-511

Germany Officer's Qtrs

Dollar Amount

of Contract

(Or Contract

Modification)

$ 10,000

14,583

211,500

Reason Why Contract Was Awarded

Without Formal Advertiseront

Same as above.

Same as above.

Same as above.

$ 51,693 Same as above.

$ 14,968 Same as above.

$ 23,217 Same as above.

$ 20,627 Same as above.

$ 59,706 Same as above.

CTI

$ 15,484 Modification to a previous contract which 3

was awarded with price proposals

solicited.

$ 96,284 Same as above.

$ 3,056 Same as above.

$ 13,771 Same as above.

$ 3,586 Same as above.

$ 24,548 Same as above.

Name of

Company With

Which Contract

Wns Placed

Heinrich Lenhard

Kaiserslautern, Germany

Gehlen Bau

Frankfurt, Germany

Pacific Architects &

Engineers, Inc.,

Los Angeles, Calif.

Stolte, Inc., Sante Fe

Engineers, Inc., Korea

Development Corporation

(A Joint Venture)

Seoul, Korea

Fischer Engineering &

Maintenance Co., Inc.,

Tong Yange Construction &

Engineering Co., Ltd. (A

Joint Venture) Seoul,

Korea

Morrison-Knudsen Interna-

tional Co., Inc., Dae Lim

Industrial Co., Ltd.,

Han Yang Development Co.,

Ltd., (A Joint Venture)

Seoul, Korea

Martin-Zachry

Constructors, Honolulu,

Hawaii

Pacific Architects &

Engineers, Inc.,

Los Angeles, Calif.

Location of Work

Pirmasens,

Germany

Frankfurt,

Germany

Vietnam

Description of Public Law

Military Construction Which Authorized

Provided by This Military

Contract Construction

Upgrading of Power 90-406

Comm Facilities

Renovation of Frankfurt 91-142

High School (Junior)

Construction of Addi- 89-202

tions to Power Plants

Pohang to Seoul, POL Pipeline, Essential 90-392

Korea Construction & Changes

Osan ana Suwon Construction of POL 91-142

Air Bases, Korea Interface facilities

Various Sites, Contractor procured 90-392

Korea Materials Furnished to

Using Agency

Marshall Islands NIKE-X & Related 89-568

Facilities, Essential 91-142

Construction & Changes 91-511

90-408

90-110

Vietnam Construction of 89-202

Generator Addition

Dollar Amount

of Contract

(Or Contract

Modification)

$ 27,365

Reason Why Contract Was Awarded

Without Formal Advertisement

Same as above.

$ 543,666 Same as above.

$ 31,833 Same as above.

$ 444,393 Modification to a previous contract which

was awarded with price proposals

solicited.

$ 94,000 Same as above.

$ 82,343 Same as above.

$ 2,144,236 Modification to a previous contract

which was awarded without price

competition.

$ 10,000 Same as above.

Summary Data for Six-Month Period Covered by this Report

Total Awards $191,550,798

Total Awards Not Formally Advertised 63,270,829

Total Awards Without Price Competition 2,468,835

Percent Awards Not Formally Advertised/Total Awards 33.0

Percent Awards Without Price Competitioun/Total Awards 1.3 '

CO

NOTE: The large increase in the precent of the dollar amount of negotiated contracts (33.0%) for

this period over the previous period (8.6%) resulted from the negotiation of one SAFEGUARD

contract in the amount of $50,000,000.

DEPARTMENT OF THE ARMY

REPORT REQUIRED BY SECTION 704 OF PUBLIC LAW 92-145 COVERING MILITARY CONSTRUCTION CONTRACTS

AWARDED WITHOUT FORMAL ADVERTISING DURING THE SIX-MONTH PERIOD FROM 1 JAN 1972 TO 30 JUNE 1972

Name of

Company With

Which Contract Was

Placed

Jack Austin & Assoc.

Oklahoma City, Okla.

REVCON Corporation

Lubbock, Texas

F.A. Villalba & Co

El Paso, Texas

Jowett Incorporated

Clinton, Maryland

M.M. SUNDT Construction Co.

Tucson, Arizona

Peter Kiewit Sons'

Co. & Associates

Omaha, Nebraska

Location of Work

Fort Polk,

Louisiana

Description of

Military Construction

Provided by

Contract

Family Housing

Roswell Airpark Rehabilitation of

Roswell, N. Mex. Buildings, Satellite

Basing/Alert Area

Roswell Airpark

Roswell, N. Mex.

Ft. Belvoir, Va.

Ft. Huachuca

Arizona

Vicinity of

Conrad, Montana

Public Law

Which Authorized

This Military

Construction

91-142

91-511

Rehabilitation of 91-511

Mechanical & POL

Facilities Satellite

Basing/Alert Area

Air Conditioning and 89-367

Improvements 11 Big.

Repairs to Garden 90-408

Canyon Water Collection

System

SAFEGUARD Ballistic 91-441

Missile Defense

System Facilities -

Phase II Malmstrom

Dollar Amount

of Contract

(Or Contract Reason Why Contract Was Awarded

Modification) Without Formal Advertising

$5,746,830 Contract negotiated in accordance with

provisions of 10 U.S.C. 2304(a)(15).

Bids received under formal advertising

were unreasonable; the negotiated price

is lower than the lowest rejected bid;

and the negotiated price is the lowest

offered by any responsible contractor.

Competitive price proposals solicited.

$ 267,711 Contract negotiated in accordance with

provisions of 10 U.S.C. 2304(a)(10) due

to urgent need for the facility.

Competitive price proposals solicited.

$ 118,345 Same as above.

$ 213,500 Same as above.

$ 22,500 Contract negotiated in accordance with

provisions of 10 U.S.C. 2304(a)(2).

Impracticable to secure competition

because work must be started immediately,

prior to completion of plans and

specifications, to protect the health

and well being of the area residents.

$110,927,932 Modification to a previous contract

which was awarded with price proposals

solicited. Basic contract negotiated

in accordance with provisions of 10

U.S.C. 2304(a)(15). Bids received under

formal advertising were unreasonable. A

letter contract was awarded in December

1971 in order to allow work to start

pending completion of negotiations.

Negotiations were completed in February

1972 and the contract was definitized by

this modification.

Name of

Company With

Which Contract

Was Placed

Peter Kiewit Sons'

Co. & Associates

Omaha, Nebraska

Ballenger Corp. 6

Central International

Corp. (Joint Venture)

Greenville, South

Carolina

Federal Republic of Germany

Federal Republic of Germany

Federal Republic of Germany

Federal Republic of Germany

Federal Republic of Germany

Federal Republic of Germany

Federal Republic of Germany

Description of Public

Military Construction Which

Providied By This NM

Location of Work Contract Constr

Vicinity of Modification 91-441

Conrad, Montana establishing new

item in the Unit Price

Schedule for interim

adjustments under

contract provisions.

Phase II - Malmstrom

Republic of Panama Rehabilitation of Boyd 92-145

Roosevelt Trans-

Isthmian Highway

Ramstein Air Base

Germany

Ramstein Air Base

Germany

Ramstein Air Base

Germany

Ramstein Air Base

Germany

Ramstein Air Base

Germany

Germany, Holland,

Italy, Turkey

Hahn Air Base,

Germany

Aerial Port Facility

Aerial Port Facility

Aerial Port Facility

Aerial Port Facility

Aerial Port Facility

TAB VEE Air Craft

Shelters Frontal

Closures

POL TANK

Controlled Humidity

Storage

90-408

90-408

90-408

90-408

90-408

90-408

89-568

Law

Authorized

ilitary

auction

Dollar .\rount

of Contract

(Or Contract

Modi fiction)

$ 900,000

Reason Why Contract Was Avardel

Without Formal Advertising

Modification to a previous contract

which was awarded with price proposals

solicited.

$ 6,745,240 Contract negotiated in accordance with

provisions of 10 U.S.C. 2304(a)(6) for

property or services to be procured

outside the United States and possessions

Competitive price proposals solicited.

$ 94,355 Contract negotiated in accordance with

provisions of 10 U.S.C. 2304(a)(6) for

property or services to be procured

outside the United States and

possessions. Competitive price

proposals solicited.

$ 15,557 Same as above.

$ 60,682 Same as above.

$ 31,697 Same as above.

$ 38,064 Same as above.

$ 638,273 Same as above.

$ 12,902 Same as above.

Federal Republic of Germany Miesau, Germany

90-5

$ 15,546 Same as above.

Name of Description of

Company With Military Construction

Which Contract Was Provided By

Placed Location of Work Contract

Federal Republic of Germany Kaiserslautern, Command Stock Storage

Germany

E. Armbruste; Kaiserslautern, Finthen, Germany Water Supply

Germany

Karl Doll

Stuttgart, Germany

Federal Republic of Germany

Federal Republic of Germany

Federal Republic of Germany

Max Jordan

Mannheim, Germany ,/

Marwais Steel Co.

Richmond, Calif.

Leonhard Bamann

Frankfurt/Main, Germany

Heinrich Lenhard

Kaiserslautern, Germany

Gehlen Bau

Frankfurt/Main, Germany

AVCO Field Engineering

Munich, Germany

Grafenwoehr, Heating for Messhalls

Germany and Latrines

Kaiserslautern, Command Stock Storage

Germany Warehouse

Ramstein & Tree Cutting

Fischbach, Germany

Erding, Germany Erection 18

Aircraft Shelters

Rhein-Main Air Apron Operational

Base, Germany

Various locations Delivery & Installa-

in Germany tion of 10 Aircraft

Shelter Closures

Frankfurt/ Bldg 272, Crime Lab

Main, Germany

Pirmasens, Germany Upgrading of Power

Comn Facilities

Frankfurt/Main, Renovation of Jr.

Germany High School

Ludwigsburg, Conversion of Coal

Germany Firing Heating to Oil

Firing

Public Law Dollar Amount

Which Authorized of Contract

This Military (Or Contract

Construction Modification)

90-408 $ 732,982

260,933

29,974

52,311

17,659

27,171

39,807

64,499

90-110

91-142

90-408

91-142

90-408

91-142

90-408

90-408

90-5

91-142

91-511

Reason Why Contract Was Awarded

Without Formal Advertising

Contract negotiated in accordance

with provisions of 10 U.S.C. 2304(a)

(6) for property or services to be

procured outside the United States

and possessions. Competitive price

proposals solicited.

Same as above.

Same as above.

Same as above.

Same as above.

Same as above.

Same as above.

Same as above.

$ 13,671 Same as above.

$ 11,421 Same as above.

$ 23,292 Contract negotiated in accordance

with provisions of 10 U.S.C. 2304(a)

(6) for property or services to be

procured outside the United States

and possessions. Competitive price

proposals solicited.

$ 88,590 Same as above.

Name of

Company With

Which Contract Was

Placed

Ed. Armbruster

Mannheim, Germany

Federal Republic of Germany

Federal Republic of Germany

Federal Republic of Germany

Josef Fischer

Regensburg, Germany

Gerhard Huebsch

Bischofsheim/Hanau,

Germany

Federal Republic of Germany

N. Sineve

Kaiserslautern, Germany

N. Sinewe

Kaiserslautern, Germany

N. Sinewe

Kaiserslautern, Germany

M. F. Wachter

Stuttgart, Germany

Federal Republic of Germany

Federal Republic of Germany

Description of

Military Construction

Provided By

Location of Work Contract

Fischbach, AMIO Depot

Germany

Hahn, Germany Aircraft Shelter

Erection

Erding, Germany 18 Aircraft Shelters

Ramstein Air Base, TAB VEE Aircraft

Germany Shelters

Hohenfels, Germany Storage Facilities

Wobeck, Germany Support Facility

Morbach, Ge many Tree Cutting

Bitburg, Germany Liquid Oxygen Plant

Germersheim, Snack Bar

Germany

Germersheim, Dispensary

Germany

Morbach, Germany Amot Stor Facility

Gablingen, Germany Army Security Agency

Location 300

Bitburg, Germany Upgrading, TAB VEE

Aircraft Shelters

Hahn, Germany Eree of Maintenance

Shelters

Public Law

Which Authorized

This Military

Construction

91-142

90-110

90-408

90-110

91-121

90-408

90-408

89-568

89-568

89-568

90-408

90-408

90-110

90-110

Dollar Amount

of Contract

(Or Contract

Modification)

$ 500,465

$ 40,498

$ 41,782

$ 84,833

$ 32,080

$ 10,622

Reason Why Contract Was .A.iec

Without Formal Advertising

Same as above.

Same as above.

Same as above.

Same as above.

Same as above.

Same as above.

$ 20,432 Contract negotiated in accordance

with provisions of 10 US.C. 2304(a)

(6) for property or services to be

procured outside the United States

and possessions. Competitive price

proposals solicited.

$ 10,827 Same as above.

$ 132,698 Same as above.

$ 194,286 Same as above.

$ 181,329 Same as above.

$ 135.437 Same as above.

$ 46,463 Same as above.

$ 20,441 Same as above.

Name of

Company With

Wlicn Contract Was

Placed

Max Jordan

Mannheim, Germany

Heilmann & Littmann

Kassel, Germany

M. F. Wachter

Stuttgart, Germany

Federal Republic of Germany

Wolf & Sofsky

Zweibruecken, Germany

A. Von Kaick

Neu Isenburg, Germany

Aero System

Milano, Italy

De Lieto Const Co.

Rome, Italy

Aero System

Milano, Italy

Stolte, Inc., Santa Fe

Engineers, Inc., Korea

Development Corporation

(A Joint Venture)

Seoul, Korea

Description of

Military Construction

Provided by

Location of Work Contract

Rhein Main, Aviation FUEL System

Germany

Mount Meissner, Army Security Agency

Germany Location 287

Esslingen, Germany Barracks Improvements

Nellingen Kaserne

Hahn, Germany

Ramstein Air Base

Germany

Ramstein Air Base

Germany

Coltano, Italy

Signonella,

Italy

Aviano Air Base

Italy

Pohang to Seoul,

Korea

TAB VEE Aircraft

Shelters

Fueling Support

Facility

Test Stand with Sound

Suppressor

Modify Air Condition

System at Autodin

Facility

Construction of

Facilities at Naval

Air Station

Modify Air Condition

System

POL Pipeline,

Essential Construction

& Changes

Public Law

W ich Author