Summary: Pursuant to a congressional request, GAO reviewed the Army's plan to establish a U.S. Army Armament Development Center and Armament Logistics command, focusing on the : (1) annual recurring cost reductions and the one-time costs; (2) community impact data; and (3) environmental impact assessments in the Army's justification study for realignment.
GAO noted that: (1) the Army estimated that the annual operating costs would decrease by about $42 million after completion of the realignment; (2) GAO, however, determined that the annual operating costs would decrease by about $31.2 million as a result of the realignment and by about $6.3 million because of workload reductions not related to the realignment; (3) the Army estimated that the one-time costs for the realignment would be about $86 million; (4) the cost estimates were based on relocating employees and equipment, altering existing facilities, and constructing new facilities; (5) since the study, the Army has changed several construction projects and, as a result, its latest estimate for total one-time costs is about $75 million; (6) the Army estimated that the realignment, including the Frankford Arsenal closure, would result in avoidances of construction costs of about $9.6 million; (7) GAO determined that the cost avoidances would be about $8.1 million, half of which would have been avoided as a result of the Frankford Arsenal closure; (8) the economic impact of the realignment on the various geographical locations shows the net change at a given point in time; (9) the Army estimated, on the basis of the January 31, 1975, payroll data, an increase on Army payroll for the community of Rock Island to be about $588,000; (10) on the basis of June 30, 1976 data, the community will experience a decrease of about $19 million; (11) although the Environmental Protection Agency (EPA) identified several factors that should have been addressed in the Army's assessments, the EPA agreed with the Army that an environmental impact statement did not need to be filed; (12) the plans to close the Frankford Arsenal were superseded by the announcement of the realignment of the armament community; (13) if the Frankford Arsenal closure plan had been implemented, it would have resulted in reductions in annual operating cost of $20.5 million and in one-time costs of about $33.6 million; and (14) because Frankford Arsenal is an integral part of the armament community, its closure costs are also included as a part of the estimates for the armament community realignment.
