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LCD-81-22 1 (1981-01-23)

handle is hein.gao/gaobabblt0001 and id is 1 raw text is: GAO United States General Accounting Office Washington, DC 20548 B-201561 HI . I . I. .....ll . 114177 Logistics arid Communications Division JANUARY 23, 1981 Honorable Honorable Honorable Honorable Honorable Honorable Honorable Subject: Lloyd Bentsen, United States Senate John Tower, United States Senate James Collins, House of Representatives Martin Frost, House of Representatives Phil Gramm, House of Representatives Jim Mattox, House of Representatives Jim Wright, House of Representatives 1roposed Consolidation of Defense Contract Administration Services Regions in St. LouiJs(LCD-81-22) In response to your May 1, 1980, request, we initiated a review of the Defense Logistics Agency's (DLA's) cost and savings estimates for the proposed consolidation of the Defense Contract Administration Services Regions in St. Louis. On March .29, 1979, the Department of Defense announced that as part of DLA's continuing effort to streamline its con- tract-administration field organization, actions would be initiated to consolidate its nine regions into five. Under the realinement plan, the Dallas and St. Louis regional offices would be consolidated into a new west central regional office and would be located in St. Louis.' The consolidation was sched- uled to begin in April 1981 and to be completed by September 1982. DLA's support for its estimates was contained in a study report issued in November 1978 and revised in October 1979. .DLA estimated that consolidating the Dallas and St. Louis regional offices and locating the new regional office in St. Louis would result in annual savings of $2.11 million and one-time costs of $1.27 million; DLA estimated that this would result in net discounted savings over a 6-year period of $5.486 million. If the regional office was located in Dallas, DLA estimated annual savings of $1.93 million and one-time costs of $1.29 million; DLA estimated that this would result in net dis- counted savings over a 6-year period of $4.936 million. On this basis, DLA decided that locating the new west central regional office in St. Louis, instead of Dallas, would be more cost effective. 1,_11I 5, N-1,(945450) The The The The The The The I 1 170,

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