Army Base Operations (BASOPS) are burdened by an aging infrastructure and smaller workforces. Increases in operations tempo and less funding make installation management more challenging. To provide guidance in execution of the BASOPS mission, the Assistant Chief of Staff for Installation Management (ACSLM) issued Army Installation Vision 20 10. The vision complements Army vision 20 10 by "nesting" five tenets of BASOPS within the Army core competencies. The five tenets are: maintain readiness; provide power projection; maintain quality of life, sustain the environment; and operate efficiently. However, recent government cost savings initiatives disrupt the five tenets and threaten Army readiness. The Office of Management and Budget A-76 circular is a 1950's program recommending outsourcing (contracting) as a means of initiating cost savings in government. First rejected by DoD, A-76 has been resurrected in the Administration's re-inventing govemment initiative and embraced by in the 1996 Defense Science Board, 1997 Quadrennial Defense Review, and Defense Reform Initiative. Final codification of OMB A-76 came in the form of the Federal Activities Inventory Act of 1998 which mandates contract studies of all commercial activities with the federal government, including DoD. The Army has identified A-76 as a cost savings weapon with BASOPS as the intended target. Between 1999 and 2003, the Army intends to save $400 million from BASOPS to apply to other Army programs. Already operating at only 69% of total financial requirements, BASOPS is an economy of force mission in the cost war. BASOPS cannot fully sustain the five tenets of Installation Vision 2010 or the Army's core competencies under the threat of A-76 or Activity Based Costing (ABC)--the Army's campaign plan to mitigate the effects of A-76. Analysis of A-76, and ABC reveals these methods as outdated accounting methods from the 1950's and 1960's. Long recognized by the private sector as "remote control" management, A-76 and ABC techniques were replaced by industry in favor of long term productivity, customer service, and core values. The Army is using outdated methods without adequate planning to secure immediate cost savings. Continuing this policy will mortgage the future of BASOPS and the Army for the long term.

ADA 383591 Approved for public release; Distribution is unlimited. The opinions and conclusions expressed herein are those of the student-authors and do not necessarily represent the views of the U.S. Army Command and General Staff College or any other governmental agency. (References to these studies should include the foregoing statement.)