Army Depot Maintenance: Privatization without Further Downsizing Increases Costly Excess Capacity.

The General Accounting Office GAO was asked to review the Armys plans to reallocate depot maintenance workloads from depots recommended for closure or realignment by the 1995 Defense Base Closure and Realignment BRAC Commission. Specifically, GAO reviewed the Armys plans to consolidate workloads at remaining Department of Defense DOD depots and emerging plans to privatize workloads in place or at other private sector facilities to determine the 1 impact on excess depot capacity and operating costs at the remaining defense depots, 2 cost effectiveness of planned privatization options, and 3 compliance with statutory requirements. The Army spends about 1.3 billion annually on depot maintenance work that includes the repair, overhaul, modification, and upgrading of aircraft, tracked and wheeled combat vehicles, and electronic items. It also includes limited manufacture of parts, technical support, testing, and software maintenance. This work generally requires extensive shop facilities, specialized equipment, and skilled technical and engineering personnel. Depot maintenance work is generally performed by government employees in government-owned and operated depots and by private sector employees in government-owned or contractor-owned facilities.