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Team Guam's Preferred Option and Cost Savings the Scenario

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Team Guam's Preferred Option and Cost Savings the Scenario DCN 1265 Team Guam's Preferred Option and Cost Savings The Scenario: Team Guam's Preferred Option Under Team Guam's alternative Scenario (Preferred Option) in contrast to the Pentagon's propod ("Close Guam Piers"), the MSC Combat Logistics Force vessels now forward deployed in*Gui& would remain so stationed. All vessels (including fleet tugs), the MSC operations paonne1, appropriate levels of PWC and other NavAct (STA) personnel to support continued MSC opWons, and METOC assets would remain in place under a consolidated NavAct. command. Approxiinately sixty percent (60%) of the savings for personnel, RPMA and BOS identified tifxier the "Close Guam Piers" scenario would continue under Team Guam's Preferred Option. Also under the scenario, both FISC and SRF, Guam would be closed. Howeva remaining MSC operations in Guam, 70% and 50% (respectively) of earlier identified closure of these facilities would be continued through a privatization/ contractual relationship. Under Team Guam's Preferred Option the U.S. Navy aviation squadron HC-5 would remain at Anderson Air Force Base (Guam). w Comparative Savings Following is a cost/savings comparison between Team Guam's Preferred Option and the Pentagon's "Close Guam Piers" scenario (in thousands). Team Guam Pentagon Team Guam as % of DoD * 1-Time Cost to Implement * Net of All Costs and Savings * Annual Recurring Savings * Net Present Value in 20 15 Team Guam's Preferred Option by Activity Following is an overview of Team Guam's Preferred Option by U.S.Navy activity designated for closure, realignment, disestablishment or redirect. This overview provides a brief description ofthe actions contemplated under the scenario and adjustments made to the COBRA input data in the actions contemplated under the scenario and adjustments made to the COBRA input data in the llrlr Preferred Option via-a-vis the Pentagon's proposal. Naval Activities. Guam Under Team Guam's Preferred Option, the Pentagon's plan to move MSC vessels to various bases in Hawaii would be reversed and the MSC's CLF vessels (and fleet tugs) would remain forward deployed in Guam. However, since the MSC support is being largely civilianized, ($ significant cuts at Naval Activities Guam would occur and the remaining activities would be consolidated into a new Naval Activities command including the navy's magazine function. The Preferred Optios puts off the final realignment of Naval Station (Naval Activities) into Naval Magazine (Naval Activities) until the year 2000 instead of 1997 as proposed under the Pentagon's "Close Guam Piers" scenario. The phasing of the implementation of the Preferred Option, which begins in 1996 is also somewhat different (See Attached Worksheet "Navacts to NavActs(M) Move"). Under the Pentagon's COBRA, 1,098 officer, enlisted and civilian personnel positions would be eliminated. Team's Guam's Preferred O~tion,would add back in 437 of these positions. Added back in from the Pentagon's scenario are; approximately one-third (113) of the positions at Naval Station (Naval Activities), Guam which were slated for elimination; almost half of the positions at PWC slated for elimination; all positions related to METOC operations in Guam; and, miscellaneous C positions such as the Navy Legal Services, OICC and COMNAVMAR necessary to support continuing activities in Guam (See Attached Worksheet "NavActs Eliminations"). Also, under Team Guam's Preferred Option, a "Recurring Savings" is added in which did not appear in the Pentagon's scenario. This savings in the Preferred Option reflects the cost of operating an additional T-AFS if the move to Hawaii were to occur. While no other such "scenario-change costs" were factored into Team Guam's Preferred Option, this addition was necessary to reflect the Pentagon's COBRA'S failure to account for the requirement that an additional AFS be added to the existing CLF vessel mix to meet tempo and CHOP string requirements should the move to Hawaii occur. This cost savings in the Preferred Option is established at $21.535 million per annum -- a cost of operating an MSCIT-AFS provided by the Department of the Navy to the Office of ~uam's Congressional delegate. Also adjusted from the Pentagon's COBRA was in the area of facilities shut-down area. This amount was increased from 442 (KSF) to a conservative 500 (KSF) to account for a reduction in BOS for pier maintenance and activities. Additionally, the milage distance between NavSta and NavMag was amended from 10 miles to five (5) miles. All other COBRA input data in the Pentagon's "Close Guam Piers" scenario remained unchanged. Fleet Industrial & Supplv Center Qlv Under the Preferred Option, FISC, Guam would close down in 1998. Like the Pentagon's scenario, 86 civilian and 13 enlisted personnel would be transferred to Naval Station (Naval '4ctivities) and 19 to Anderson AFB. These FISC movements into Naval Station, represent the personnel necessary to support supply functions at Naval Activities. Additionally, MILCON cost avoidances identified under the Pentagon's scenario would be realized. The Preferred Option, would trarisfer an additional five (5) officers and ten (10) enlisted personnel into Naval Activities for contract oversight and administration of FISC-like activities that would continue vis-a-vis the MSC (AFS's, MPSRON, COMPSRON and DEGAR) load out and resupply operations under a private contract. Unlike the Pentagon's scenario, after 1998,70% of the cost- savings that would be realized in the Pentagon's proposed disestablishment of FISC Guam, would be made available for the privatization of FISC's function in relation to MSC support. This amount is $18,269,000. This figure reflects 70% of the savings the Pentagon's scenario identified in RPMA, BOS, Military and Civilian salaries and Mission and Miscellaneous Costs. The only other factor altered from the Pentagon's scenario was the adjustment of the distance between FISC and NavActs (from 5 to 1 mile). llrr Ship Repair Facility. Guam Under the Preferred Option, SRF, Guam would close down in 1998. Like the Pentagon's scenario, 3 1 civilian, three (3) enlisted and one (1) oficer personnel would be transferred to Naval Station (Naval Activities) and the CINCPACFLT Rep., Guam. Additionally, MILCON cost avoidances identified under the Pentagon's scenario would be realized. All remaining personnel positions would be eliminated by 1998 under a phasing scenario which leaves the majority of the cuts until that year. Unlike the Pentagon's scenario, after 1998,50% of the cost- savings that would be realized in the closure of SRF, Guam would be made available for the privatization of SRF's function in relation to MSC work and other work that could be assigned by CINCPACFLT. This amount is $18,342,000. This figure reflects 50% of the savings the Pentagon's scenario identified in RPMA, BOS, Military and Civilian salaries and Mission and Miscellaneous Costs. Naw Air at Anderson Air Force Base Under the Preferred O~tion,HC-5 would continue to operate out of Anderson Air Force Base (AAFB) in support of MSC operations that would remain in Guam. The VQ-1 and VQ-5 squadrons which have already moved to CONUS would remain in their present locations. Like the Pentagon's scenario, the Preferred Option includes MILCON at VQ-1 and VQ-5's new locations as well as the cost avoidance at AAFB in relation to those squadrons movement to CONUS. - Unlike the Pentagon's scenario, however, Team Guam's Preferred Option does not reflect the cost of moving the personnel and equipmentof VQ- 1 and VQ-5 since these movements have already taken place and the costs of the moved already incurred. An additional change to the Pentagon's scenario is an adjustment to the Recurring Cost savings identified. Instead of a recurring savings of almost $27 million for the annual operat'ional cost at AAFB, the amount was reduced to $19.2" million to reflect the cost savings attributable only to VQ-1 and VQ-5's ($1 1.7 and $7.5 million respectively) movement from AAFB. The estimated $7.5 million in costs of operating HC-5 at AAFB was eliminated fiom the Pentagon's identified $27 million recurring savings since HC-5 would continue to operate at AAFB. A final adjustment made in the Team Guam Preferred Option for Navy Air at AAFB, is that one (1) officer and 40 enlisted positions (security) that were to be eliminated in the Pentagon's scenario were added back in to support HC-5's operations at AAFB. ADDER REALIGNMENT SUMMARY (ADDER v5.08) - Page 1/2 Report Created 22:45 05/22/1995 ADDER Data File: C:\COBRA\MSC-GUAM.OUT Starting Year : 1996 '(111 Final Year : 2000 ROI Year : Immediate NPV in 2015($K) :-1,449,176 l-Time Cost ($K): 65,348 Net Costs ($K) Constant Dollars 1996 1997 Total Beyond ---- ---- ----- ------ MilCon -168,286 -13,717 -171,752 0 Person -717 -6,018 -266,569 -85,150 Overhd -14,996 -15,081 -26,000 10,640 Moving 31 1,329 12,890 0 Missio 0 0 -86,140 -21,535 Other 116 118 897 0 TOTAL -183,852 -33,369 Total POSITIONS ELIMINATED Off 1 11 En1 4 5 110 c:.v 0 112 TOT 46 233 POSITIONS REALIGNED Off 3 10 En1 38 39 s1.u 0 0 Civ 86 316 TOT 127 365 ADDER REALIGNMENT SUMMARY (ADDER v5.08) - Page 2/2 Report Created 22:45 05/22/1995 ADDER Data File: C:\COBRA\MSC-GUAM.OUT Costs ($K) Constant Dollars 1996 1997 1998 Total Beyond w ---- ---- ---- ----- ------ MilCon 7,263 2,463 9,308 Person 68 701 1,883 Overhd 4,317 5,640 6,263 Moving 31 1,329 5,066 Missio 0 0 0 Other 116 118 663 TOTAL 11,795 10,251 23,183 50,278 54,151 Savings ($K) Constant Dollars 1996 1997 Total Beyond ---- Mi lCon 175,550 Person 785 Overhd 19,312 Moving
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