2015 Budget Reduces Infrastructure Spending, Official Says
By Claudette Roulo
American Forces Press Service
WASHINGTON, March 12, 2014 The Defense Department is assuming more risk in infrastructure with its proposed 2015 budget, the acting deputy undersecretary of defense for installations and environment told a House Appropriations Committee panel here today.
Military construction accounts for $6.6 billion of the $496 billion in total funding allowed under the Bipartisan Budget Act of 2013, John Conger said in a hearing of the committee’s military construction, veterans affairs and related agencies subcommittee. Facility sustainment and restoration accounts for another $8 billion, and $3.5 billion is allotted for environmental compliance and cleanup, he said.
The military construction request is 40 percent less than the department requested for 2014, he noted. “But because infrastructure generally has a long, useful life, and its associated degradation is not as immediate,” he added, “the DOD components are taking more risk in the military construction program in order to decrease risk in other operational and training budgets.”
Reducing military construction reduces the possibility of the department investing in infrastructure that may become obsolete or excess due to the uncertain allocation of force structure cuts and the possibility of a new round of base realignments and closures, Conger said.
“The budget challenges facing the department are deep, and they extend for many years,” Conger said. “We continue to believe that an important way to ease this pressure is with base closure, allowing us to avoid paying upkeep for unneeded infrastructure and making those funds available for readiness and modernization of our forces.”
Defense Secretary Chuck Hagel said last month in his announcement of the proposed budget that the department cannot fully achieve its goals for overhead reductions without cutting unnecessary and costly infrastructure, so it’s asking Congress for another round of base realignments closures in 2017. “I am mindful that Congress has not agreed to [our] BRAC requests of the last two years,” the secretary added. “But if Congress continues to block these requests even as they slash the overall budget, we will have to consider every tool at our disposal to reduce infrastructure.”
Conger noted today that the department isn’t seeking to duplicate the conditions of the 2005 round of base closures, which he acknowledged “left a bad taste” in the mouths of many members of Congress.
The high costs incurred by the department during the last round of base closures was in large part due to the emphasis in 2005 on transformation, rather than efficiency, Conger said.
“The key reason that BRAC 2005 cost so much was that we were willing to accept recommendations that did not save money,” he told lawmakers. “They did not pay back.”
Following an internal review of the 2005 BRAC, Conger said, his staff found that the department actually ended up conducting two parallel rounds of base closures. “The first one was about transformation. The recommendations were expensive, and they didn't have payback,” he said. But, he noted, they were necessary, because “there are some actions you can only execute when you have BRAC authority.”
These more costly “transformation BRAC” actions made up nearly half of the recommendations made by the 2005 BRAC commission, Conger said, and totaled $29 billion out of the $35 billion in upfront costs. They also only resulted in $1 billion in annual savings, he added.
The remaining recommendations were focused on efficiency, the deputy undersecretary said, and paid back within seven years.
“They ended up costing a total of $6 billion and yielding recurring savings of $3 billion a year,” Conger said. “This … proves that when we're trying to save money, we do. That's the kind of round we're seeking to conduct now.”
In response to congressional comments that the department should seek to close overseas bases before conducting a new round BRAC in the United States, DOD has embarked on an analysis of a possible BRAC-like process in Europe, the deputy undersecretary said. “However, in this effort, we're not looking at bringing forces back to the United States,” he added. “We hold forces constant, and we're looking for efficiencies. So it will not take pressure away from the need for a new BRAC round.”
Infrastructure in Europe already has been reduced by 30 percent since 2000 and the authority of a BRAC commission is not needed to close bases in Europe, Hagel noted in his preview of the budget request. Today, Conger said he expects the results of the European Infrastructure Consolidation Review this spring, but several recommendations already have been affirmed.
“While most of the recommendations will take years to execute and will require lengthy consultation, there are some near-term activities,” he said.
One of these recommendations in particular should be highlighted, Conger said: a $92 million construction request in support of the consolidation of intelligence activities at a base in England. The consolidation is part of a three-year effort expected to cost about $300 million and to yield $1 billion in savings over the next 10 years.
“That's the kind of thing we're trying to accomplish,” Conger said.
(Follow Claudette Roulo on Twitter @rouloafps)