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PLRD-81-9 1 (1981-04-01)

handle is hein.gao/gaobabbtv0001 and id is 1 raw text is: UNITED STATES GENERAL ACCOUNTING OFFICE WASHINGTON, D.C. 20548 PROCUREMENT, LOGISTICS, ANO READINESS DIVISION RESTR~T~ ern'sr n,>' Acco -.nt. o,~irc approval by the Office e. approval- , d. B222RELEASED The Honorable Doug Barnard IIL~ 'House of Representatives I1 Dear Mr. Barnard: 114877 Subject: Bkrmy's Contracting Out of Installation Support Functions at Fort Gordon, Georgia (PLRD-81-9 In your letter of May 1, 1980, you requested that we review the Army's contracting practices at Fort Gordon, Georgia. On March 25, 1980, former Congressman Dawson Mathis had also requested us to perform this review. The Army com- pared the cost of doing work in-house with the cost of con- tracting out for 19 installation support functions, including maintenance, supply and service, transportation, and housing. The Army completed its cost comparison in January 1980 and announced that contracting out the functions would save the Government about $32 million over a 58-month period, or about $6.6 million annually. The Army awarded two contracts for the support functions to Pan American World Airways, Inc., on June 26, 1980. The contracts included a 2-month phase-in period during July and August and a 1-month full performance period during September 1980. The contracts also contained provisions for negotiated options during fiscal years 1981 through 1984. SCOPE OF REVIEW As agreed with your office, our objective was to identify any significant errors in the development of estimated in- house costs, giving primary attention to direct labor costs. To accomplish this objective, we reviewed (1 the instructions and guidance in the Office of Management and Budget Circular A-76 and its supplement, the Cost Comparison Handbook, (2) the detailed schedules supporting the study results, (3) the results and details of the Army Audit Agency's reviews of the study, (4) several Army guides and regulations, and (5) the Army's method of computing contract administration costs. We interviewed numerous officials at Fort Gordon and (950608)

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