Committee Questions Premium DOD Pays for Construction

In response to a recent study showing that a host of federal requirements add 25 to 40 percent to the cost of military construction, the House Armed Services Committee is directing the Defense Department to consider ways to eliminate the extra expenses, according to language in the report accompanying its version of the fiscal 2012 defense authorization bill.

The committee approved the measure, H.R. 1540, May 12.

Several of the added expenditures result from federal contracting rules, including the payment of Davis-Bacon wages, subcontracting and small-business goals, and bonding requirements in the Miller Act. Federal goals for energy efficiency of buildings and the need for anti-terrorism and force protection measures also drive up the cost of construction above private-sector norms.

“The committee believes that these substantive markups are excessive and limit the purchasing ability of the department to procure vital military construction projects,” the committee said. “The committee also believes that it is incumbent on the department to minimize barriers to competition and ensure the widest participation of construction contractors to military construction programs,” according to the report.

In addition to developing a plan to trim the extra costs, the defense secretary should assess the policies that boost the cost of military construction, the report states. That review should characterize the impact of the factors by specific facility category, including childcare centers, chapels, dependent schools and dormitories.

The defense authorization bill is scheduled to be debated on the House floor this week. H. Rpt. 112-78 can be found on the Armed Services Committee’s website.


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