Press Release

Schumer, Gillibrand Secure Passage of Critical Legislation to Force Department of Defense to Perform Detailed Review of Flawed West Point Study – DOD Must Answer to Congress

Jul 24, 2009

U.S. Senators Charles E. Schumer and Kirsten Gillibrand
today announced passage of legislation, as part of the Department of Defense
Reauthorization bill, that will force the Department of Defense (DOD) to do a
thorough re-examination of OMB Circular A-76 Studies that carry on for longer
than 3 years, such as the study at the United States Military Academy at West
Point.  If the DOD indicates, after the review, that it does not want to
terminate the study, they must provide their reasoning to Congress.  The
Senators said that forcing such a review is critical because it will – if DOD
decides not to cancel the study – delay implementation during the
revaluation.  Schumer and Gillibrand are working to secure language in the
2010 Defense Appropriations bill, to be considered this fall, preventing the
implementation of the A-76 Study at West Point by depriving it of funding.

The legislation passed last night, authored by Senator
Robert Casey of Pennsylvania and co-sponsored by Senators Schumer and Gillibrand,
would force a review for all studies that lasted longer than 36 months,
including preliminary planning, that also examine the benefits of privatization
for more than one class of worker.  Such studies are known as
“multi-function activities.” The legislation clearly indicates that
Congress believes that A-76 studies that have continued unchecked for several
years, such as the study completed at West Point, should be cancelled.

“This is a positive step on the road to undoing what is
clearly a deeply flawed study,” said Schumer.  “It will bring some
accountability to the process, and force the Department of Defense to take a
cold hard look.  I am hopeful they that after a thorough examination they
will realize the inherent problems with the study, but if not, we will continue
our fight.”

“We are one step closer to preventing the privatization
of jobs at West Point,” Senator Gillibrand said. “During these tough economic
times, we need to maintain as many jobs as possible in our communities. The study
at West Point was obviously flawed and unfair. I will continue working with
Senator Schumer to keep our jobs here at West Point.”

Schumer and Gillibrand have fought for the past months to
stop the West Point study in its tracks.  The Senators noted that the A-76
study used to compare the use of private versus public employees yields
overwhelmingly unreliable results and therefore has put jobs and families at
risk while accruing no proven benefits to the taxpayer.  Earlier this
year, after a series of congressional investigations by the Government
Accountability Office (GAO) highlighted the significant flaws inherent in the
current A-76 process, Congress took action and inserted language in fiscal year
2009 Omnibus Appropriation bill that prevented any new A-76 studies from
beginning for the next year. However, since the West Point study was already
underway, the results of the study are still subject to implementation. Schumer
and Gillibrand have previously written to Secretary of Defense Gates and Secretary
of the Army Peter Geren to oppose completion and implementation of the flawed
West Point study.

The Office of Management and Budget (OMB) established the
A-76 study in an effort to compare the costs of work done by government
employees to that of private contractors. However, GAO reports have highlighted
the significant flaws inherent in the current A-76 process. For one, the study
is measuring two employment structures that cannot be accurately compared. The
study estimates the total cost to the Army of continuing to use federal
employees, but, when soliciting bids from private contractors, the Army is
asking for a “cost plus firm fixed fee” contract. These contracts do not
require the contractors to estimate their costs, and mean that the Army will have
to pay whatever the contractor bills. If this contract is privatized, it could
easily cost the Army more money than would the use of the current unionized
workforce. That risk alone is sufficient proof that the study is flawed,
according to the senators.

Schumer and Gillibrand also noted that the study is
flawed because the Army changed the requirements for the union halfway through.
Originally, the Army allowed the union to combine the operations/maintenance
and custodial responsibilities into a single bid, which allowed them to achieve
economies of scale. Halfway through the process the Army required the union to
separate these two contracts, but did not allow them to begin the process over.

Schumer and Gillibrand said that with millions of
taxpayer dollars and hundreds of local jobs at stake, these discrepancies
significantly threaten the validity of the study and therefore should not be
implemented. In April, Schumer and Gillibrand cosponsored the CLEAN-UP Act to
closely examine the effectiveness of A-76 studies and overhaul the process.
They plan to continue to work to prevent implementation of the current West
Point study through the fiscal year 2010 Defense authorization and
appropriations process.