Statement of Robert F. Hale, Assistant Director, National Security Division, Congressional Budget Office
Abstract
Chairman Inouye, Chairman Sasser, and Members of the Committee, I appreciate the opportunity to testify before you this afternoon on the Congressional Budget Office's (CBO's) analysis of the costs and savings of past military base closures and realignments. I hope that our work on this important subject will help this Committee and the Congress as they review the plans of the Department of Defense (DoD) to close and realign military bases. The Commission on Base Realignment and Closure has estimated that their recommended actions will eventually save $693.6 million annually in base operating costs. After deducting the one-time costs associated with closing bases, the commission estimates that the net present value of savings will total $5.6 billion over the next 20 years. To provide a perspective on these projected savings, CBO has estimated the costs and savings associated with selected base closings and realignments that occurred during the 1970s. We focused on nine bases for which some historical data were available and used the data to estimate both the recurring annual savings and the one-time net costs involved with base closings and realignment. The commission's estimates of savings fell at the upper end of the range suggested by our data. Unfortunately, missing historical data and differences in definitions make comparisons of one-time costs and savings unclear. My testimony also discusses three potential issues raised by our analysis that relate directly to the commission's recommendations. These issues include the effect of base closings and realignments on the budget deficit, the problem of defining one-time costs and savings, and the method of specifying the payback period. My testimony does not assess the advantages and disadvantages of the currently proposed package of base closings and realignments. Nor will I assess the commission's cost estimates, though the historical costs in this statement may provide helpful background.
Document Details
- Document Type
- Technical Report
- Publication Date
- Apr 04, 1989
- Accession Number
- ADA529848
Entities
People
- Robert F. Hale
Organizations
- Congressional Budget Office