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Executive Summary Faced with declining budgets, the Department of Defense is cutting spending, with reducing excess infrastructure high on the list of potential sources of savings. Congressional opposition to the Pentagon’s request to hold a new BRAC round means the department will have to find other ways to trim installation expenditures. But what are the alternatives? How can DoD reduce its total installation ownership costs while maintaining mandated force readiness? Given these current challenges, does DoD need a new way of thinking when it comes to installation management?

At the center of this policy stalemate are America’s defense communities and states who face an uncertain future in which they know significant budget cuts will occur, but in an opaque manner leaving them little flexibility to prepare for the outcome. The specter of “hollow” bases that produce little or no positive economic outcomes for a community is worse than closing bases, where at least the community would have the opportunity for economic growth.

Finding a politically feasible solution to the military’s budget and infrastructure challenges – even if it is painful – is in the best interest of DoD, defense communities and the elected officials who represent them.

On Nov. 12, 2013, the Association of Defense Communities convened a Defense Policy Forum to bring together key leaders from DoD, Congress, communities and industry to explore policy alternatives to BRAC and discuss the need for a

future BRAC. The Forum sought to achieve two objectives:

• Identify feasible options for reducing excess DoD infrastructure and facility/maintenance costs

• Develop specific policy recommendations for DoD and Congress

The underlying challenge of the half-day Forum was to come up with ways to implement the infrastructure cost savings necessitated by budget cuts and force reductions that would be amenable to Congress, while balancing the needs and interests of defense communities and states.

Specifically, the policy forum focused on the following forum policy areas identified as alternatives to BRAC:

• Property Disposition Innovations: Streamlining existing authorities and policies and identifying new authorities needed to enable the productive conveyance and reuse of properties that are excess to military missions

• Asset Management Innovations: Using facilities and infrastructure to support the mission, military families, and broader community needs.

• Partnership Innovations: Developing new paradigms for cooperation and collaboration with state, regional, and local governments and private entities to produce positive outcomes for all

• Future Installation Innovations: Identify funda-mental changes driven by force structure, mis-sion and weapons evolution that will change the need for and nature of installations (e.g., City Base, Working Base Integrated Government Facility.)

BRAC/Alternatives to BRAC:After Action Report NOVEMBER 12, 2013

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Major Themes Discussed Speakers covered a gamut of possibilities for helping DoD manage its infrastructure more efficiently, including reinventing the BRAC process, increasing reliance on communities to provide on-base services, redefining the installation of the future and partnering more closely with host communities to support economic development.

Unsurprisingly, there was uniform agreement that DoD needs to conduct another round of BRAC. “The current footprint is immense,” said one participant.

More significantly, there was a strong push for a more efficient base closure process; in particular, one that isn’t as complicated with hundreds of realignments and expensive as the 2005 round. A future BRAC round should focus on closing bases and saving money relatively quickly. Some specific ideas for a new round called for the Pentagon to:

• Ask communities to volunteer a local base for closure as some locales may be more interesting in seeing commercial and residential uses at an existing installation;

• Create a “safe list” to take the drama out of the next BRAC round;

• Develop new selection criteria; and

• Exhaust other avenues for savings as opposed to force structure reduction.

Even in the absence of congressional authorization to conduct a new BRAC round, speakers urged the department to take full advan-tage of its asset management tools to trim its real estate footprint. Suggestions included eliminating the use of leased space and demolishing excess property.

Several recommendations, however, would require statutory changes to be carried out, including

• Providing the military authority to transfer property more quickly;

• Consolidating missions from different places into fewer locations, which would require limits on the movement of military personnel in 10 U.S.C. 2687 to be eased; and

• Expanding the exchange authority allowing the military to swap excess property for services or other consideration. One participant said that may not be feasible, however, and instead the parties should strive to make the current process work better.

Some speakers noted that partnering with the neighboring community would be one of the most effective ways to help the services better use their real estate. One tool DoD could make greater use of is enhanced use leasing, which allows the military to leverage the value of underutilized property and the community to benefit from economic growth. Some underutilized property may be best designated as a buffer and limited to compatible land uses.

Overall, speakers concluded that DoD and defense communities need to work more closely by finding new opportunities for collaboration. A more robust relationship between the two can be expected to produce a change in culture that should foster great-er use of existing tools and authorities to reduce infrastructure costs, according to the discussion.

One of the most powerful tools for helping the military services lower their operating costs is the new Section 331 authority (10 U.S.C. 2336) allowing installations and neighboring communities to enter into intergovernmental support agreements defining how the two can share various base support services. Speakers highlighted the benefits to the military from entering shared services agreements with com-munities as DoD budgets for installation support are taking the brunt of sequester cuts.

Beyond sharing standard municipal services,

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installations could benefit from divesting morale, wel-fare and recreation services, along with programs for military families such as financial readiness, suicide prevention and sexual assault prevention.

To support military service initiatives to take advan-tage of section 331, DoD needs to provide upfront funding along with training on the best way to reach out to communities and establish new intergovern-mental support agreements. Further guidance also is needed on the technical aspects of implementing such agreements, particularly regarding contracting and legal questions, speakers noted.

Several speakers recommended that Congress should clarify or broaden section 331, although one panelist responded that it is too early to make fundamental changes to the authority.

The potential for innovative models of installation management to help DoD realize efficiencies also came up during the event. Panelists said DoD and communities should identify and move towards new models for the installation of the future, including a more-integrated joint base, a multi-tenant federal facility and other intergovernmental models. The city-base model -- which has only been attempted once, in San Antonio -- also bears further consideration.

Another theme that emerged from the Forum was the importance of including state and local govern-ments in the military’s strategic basing decisions. Changes in force structure and missions -- even if they involve only modest adjustments -- have broad consequences for local economies and extend beyond the direct impacts on jobs, local businesses and tax receipts. Including communities early in a service’s deliberations over a basing decision can help them mitigate the multitude of potential impacts to transportation, housing, public schools and commu-nity colleges, and workforce training programs.

To support communities’ planning efforts, installation

officials need to provide realistic projections of mission changes and associated timelines, and continue to keep open communications lines after decisions have been announced. Including communi-ties in the data calls for basing decisions, for example, is one way the services can reach out to communities.

Perhaps the one step DOD and communities could take to enhance collaboration is for the host community and the installation to designate a single points of contact, panelists recommended. More specifically, DoD should formally recognize a community counterpart to formalize partnering and improve communications. That recognition would support better community planning and implemen-tation of growth, realignment and closure decisions.

Action PlanThe Forum produced a number of robust ideas for consideration. As a next step, ADC in conjunction with the installation community should pursue a number of policy and legislative initiatives:

• Clarifying the intent of Congress in 10 U.S.C. 2336 (also known as Section 331) in terms of federal contracting actions and small business.

• Amending 10 U.S.C. 2336 to allow for longer contracts, facilitating capital investments by communities.

• Expanding 10 U.S.C. 2336 to allow for disposal of real property when such actions facilitate a productive partnership with communities.

• Establishing a single point of contact that represents multiple jurisdictions and local economic interests in dealing with a neighboring installation’s needs.

• Giving state and local government a “place at the table” in the evolution of the base of the future. This would enable DoD to take advantage of local and state agency capabilities to support service members and their families, and provide modern infrastructure for force protection and power projection.

ADC 2013 Defense Policy Forum