Summary: A review was made of the decision by the Defense Logistics Agency (DLA) to merge the Defense Contract Administration Service's Cleveland regional office into the Chicago regional office. The merger of the two offices was part of an overall Department of Defense plan to reduce administrative costs and attain a more efficient support structure. On October 11, 1979, the GAO review team provided a briefing on the progress of the review. Events occurring after initiation of the review eliminated Chicago as the potential location for the consolidated office. The requestors of the review were advised via a letter dated October 16, 1979, that DLA had decided to locate the consolidated office in Cleveland.
The preliminary analysis showed that Chicago was economically more advantageous than Cleveland. However, the estimates and projections contained judgments and assumptions that a decision could not be based unequivocally on economic factors. It was also noted that the Air Force was studying the feasibility of relocating its O'Hare Airport activities to provide expansion of Chicago's O'Hare International Airport and that such a relocation could be pivotal to the final site selection by DLA. On October 15, 1979, the President announced that the Air Force land would be turned over to the city of Chicago. This announcement led DLA to reverse its initial decision and locate the consolidated region in Cleveland. The review was discontinued as a result of this development and no further reporting on the matter was planned.
