Facility Cost of Ownership Study and Tool
This task order supported NAVFAC, CNIC and OPNAV N81 with the "honest broker" recommendations in regard to reducing the Navy's shore infrastructure footprint, which is not adequately sustainable at projected future funding levels. The resultant deteriorating conditions of these assets have short- and long-term shore and fleet readiness implications. They are further exacerbated by ongoing initiatives that grow the shore footprint, increasing competition for limited shore readiness resources. The Navy's current footprint reduction efforts mainly focus on case-by-case facility demolition rather than employing an overarching strategic vision and top-down driven plan.
Additionally, as part of the POM-12, N46 proposed a "strategic pause" with the demolition (DE) program pending development of a Global Shore Footprint Reduction Plan. This study established cost factors and programming metrics applicable to developing the Global Shore Footprint Reduction Plan in concert with CNIC's Shore Design concept. The study and automated analysis tool provided N81 the ability to analyze Total Ownership Cost (TOC) of facilities, develop a programmatic metric to track TOC reduction, analyze the ownership costs of Navy's excess facility capacity, and analyze funding profiles for divesting excess infrastructure with least cost/greatest return on investment. The study challenges were overcome and objectives far exceeded. Solutions included:
- Defining measurable Cost of Ownership (SRM and BOS and recapitalization) factors for new and existing facilities by category codes.
- Recommending programming metrics to measure success in a shore infrastructure.
- A TOC reduction program. Examples include annual savings (BOS, SRM, etc.) and PRV reduction (vs. to SF reduction). An analysis of current shore footprint against projected future shore footprint requirements, identification of excesses or underutilized footprint, and documentation of corresponding "added costs of ownership" due to existing excesses using the factors and metrics developed in this study.
- Delivery of demolition (DE) funding profiles (conservative, moderate, aggressive) that produce the greatest reduction in total ownership cost in the shortest amount of time.