Order Code RL31810
CRS Report for Congress
Received through the CRS Web
Appropriations for FY2004: Military Construction
Updated July 30, 2003
Daniel H. Else
Analyst in National Defense
Foreign Affairs, Defense, and Trade Division
Congressional Research Service ˜ The Library of Congress

Appropriations are one part of a complex federal budget process that includes budget
resolutions, appropriations (regular, supplemental, and continuing) bills, rescissions, and
budget reconciliation bills. The process begins with the President’s budget request and is
bound by the rules of the House and Senate, the Congressional Budget and Impoundment
Control Act of 1974 (as amended), the Budget Enforcement Act of 1990, and current
program authorizations.
This report is a guide to one of the 13 regular appropriations bills that Congress considers
each year. It is designed to supplement the information provided by the House and Senate
Defense Appropriations Subcommittees. It summarizes the current legislative status of the
bill, its scope, major issues, funding levels, and related legislative activity. The report lists
the key CRS staff relevant to the issues covered and related CRS products.
This report is updated as soon as possible after major legislative developments, especially
following legislative action in the committees and on the floor of the House and Senate.
NOTE: A Web version of this document with active links is
available to congressional staff at:
[http://www.crs.gov/products/appropriations/apppage.shtml].


Appropriations for FY2004:
Military Construction
Summary
The military construction (MilCon) appropriations bill provides funding for (1)
military construction projects in the United States and overseas; (2) military family
housing operations and construction; (3) U.S. contributions to the NATO Security
Investment Program; and (4) the bulk of base realignment and closure (BRAC)costs.
The President forwarded his fiscal year 2004 budget request to the Congress on
February 3, 2003. The original military construction request of $9.0 billion was later
increased to $9.2 billion due to reprogramming from the defense appropriations bill
(H.R. 2658) and an Administration request related to foreign currency fluctuations
as calculated by the Congressional Budget Office.
On June 17, 2003, the House Appropriations Committee reported a bill (H.R.
2559) that recommends $9.2 billion in military construction appropriations. This is
$41 million below the President’s revised request and $1.5 billion below the FY2003
appropriation. The House passed the bill on June 26. The Senate Appropriations
Committee marked up an original version of the bill (S. 1357) and reported it to the
Senate on June 26. On July 10, the Senate began consideration of H.R. 2559,
substituting the text of S. 1357, and passed the amended bill on July 11. Further
action awaits the meeting of the conference committee.
Authorization of military construction is included within the defense
authorization bill. The House passed its version of the bill (H.R. 1588) on May 22.
The Senate substituted the text of S. 1050 for that of H.R. 1588 and passed the
amended bill on June 4, 2003. The conference committee began meeting on July 22.
As of the writing of this report, conference action has not concluded.
For a
comprehensive report on defense authorization legislation, see CRS Report
RL31805, Authorization and Appropriations for FY2004: Defense, by Amy Belasco
and Stephen Daggett.

Key Policy Staff
CRS
Telephone
Area of Expertise
Name
Division
and E-Mail
Base Closure
David Lockwood
FDT*
7-7621
dlockwood@crs.loc.gov
Defense Acquisition
Valerie Grasso
FDT
7-7617
vgrasso@crs.loc.gov
Def. Budget, Mil. Con./
Daniel H. Else
FDT
7-4996
Defense Industry
delse@crs.loc.gov
Defense Budget
Amy Belasco
FDT
7-7627
abelasco@crs.loc.gov
Defense Reform
Gary Pagliano
FDT
7-1750
gpagliano@crs.loc.gov
Guard and Reserve Issues Lawrence Kapp
FDT
7-7609
lkapp@crs.loc.gov
* FDT = Foreign Affairs, Defense, and Trade Division of the Congressional Research
Service.

Contents
Most Recent Developments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Background . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Content of Annual Military Construction Appropriations and
Defense Authorization Bills . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Bill Status . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Appropriations Action . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
House Appropriations Action . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Senate Appropriations Action . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Changes in Funding Request During the Legislative Process . . . . . . . . . . . . 4
Key Policy Issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Overall Funding Levels . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Realignment of Overseas Bases . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Base Realignment and Closure (BRAC) . . . . . . . . . . . . . . . . . . . . . . . . 6
The Efficient Facilities Initiative (EFI) . . . . . . . . . . . . . . . . . . . . . . . . . 7
The Brooks Air Force Base Development Demonstration Project . . . . 7
Perchlorate Groundwater Contamination Remediation . . . . . . . . . . . . . 8
Major Funding Trends . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Legislation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Military Construction Appropriations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Defense Authorization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
For Additional Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
CRS Products . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
Selected World Wide Web Sites . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
List of Figures
Figure 1. Military Construction Funding . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
List of Tables
Table 1. Status of Military Construction Appropriations, FY2004 . . . . . . . . . . . . 4
Table 2. Military Construction Appropriations by Account:
FY2003-FY2004 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Table 3. Military Construction FY2004 Appropriations by Account;
Congressional Action . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Table 4. Congressional Additions to Annual DOD Budget Requests for
National Guard and Reserve Military Construction, FY1994-FY2004 . . . . 13

Appropriations for FY2004:
Military Construction
Most Recent Developments
The House Appropriations Committee introduced its Military Construction
Appropriations Bill for Fiscal Year (FY) 2004 (H.R. 2559, H.Rept. 108-173) on June
23, 2003. The House considered and passed the bill on June 26, 2003.
The Senate Appropriations Committee introduced its companion bill (S. 1357,
S.Rept. 108-82) on June 26. On July 10, the Senate amended H.R. 2559 by striking
the text and substituting that of S. 1357. The Senate passed the amended bill on July
11 (91-0) and requested a conference with the House.
Background
Content of Annual Military Construction Appropriations and
Defense Authorization Bills

The Department of Defense (DOD) manages the world’s largest dedicated
infrastructure, covering more than 40,000 square miles of land and a physical plant
worth more than $500 billion. The military construction appropriations bill provides
a large part of the funding to enhance and maintain this infrastructure. The bill funds
construction projects and some of the facility sustainment, restoration and
modernization of the active Army, Navy and Marine Corps, Air Force, and their
reserve components;1 additional defense-wide construction; U.S. contributions to the
NATO Security Investment Program (formerly known as the NATO Infrastructure
Program);2 and military family housing operations and construction. The bill also
1 Facility sustainment, restoration, and modernization (SRM) includes the repair and
maintenance of buildings, structures, warehouses, roadways, runways, aprons, railway
tracks, utility plants, and their associated distribution systems, plus minor construction (cost
not to exceed $500 thousand) to create new facilities or expand, alter, or convert existing
facilities. A large part of the funding dedicated to the SRM function is requested not as part
of the military construction appropriation, but rather as part of the Operations and
Maintenance account within the annual defense appropriation.
2 The NATO Security Investment program is the U.S. contribution to Alliance funds for the
construction of facilities and the procurement of equipment essential to the wartime support
of operational forces in the common defense of the NATO area. Facilities funded by this
program include airfields, naval bases, signal and telecom installations, pipelines, war
headquarters, as well as early warning radar and missile installations. The U.S. contributes
(continued...)

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provides funding for the Base Realignment and Closure (BRAC) account, which
finances most base realignment and closure costs, including construction of new
facilities for transferred personnel and functions and environmental cleanup at
closing sites.3
The military construction appropriations bill is one of several annual pieces of
legislation that provide funding for national defense. Other major appropriation
legislation includes the defense appropriations bill, which provides funds for all non-
construction military activities of the Department of Defense and constitutes more
than 90% of national security-related spending, and the energy and water
development appropriations bill, which provides funding for atomic energy defense
activities of the Department of Energy and for civil projects carried out by the U.S.
Army Corps of Engineers. Two other appropriations bills, VA-HUD-Independent
Agencies and Commerce-Justice-State, also include small amounts for national
defense.4
No funds may be expended by any agency of the federal government before they
are appropriated.5 In addition, for nearly half a century Congress has forbidden the
Department of Defense to obligate funds for any project or program until specific
authorization is granted.6 This explains why, for defense funds, both authorization
and appropriations bills are required. Two separate defense appropriations bills are
written annually, a “Military Construction Appropriations Act” dedicated to military
construction, and a “National Defense Appropriations Act” covering all other defense
appropriations.7 Normally only one “National Defense Authorization Act” is passed
each year to authorize both of these appropriations.8 Therefore, major debates over
defense policy and funding issues, including military construction, can be associated
with any of these bills. Because issues in the defense authorization and appropriations
bills intertwine, this report includes salient parts of the authorization bill in its
discussion of the military construction appropriation process.
2 (...continued)
approximately 25% of the total annual NSIP assessment, with the rest coming from the other
members of the North Atlantic Alliance.
3 Virtually all costs associated with the latest completed BRAC round (that of FY1995) have
been funded. The bulk of current BRAC appropriations (before the next round commences
in FY2005) will be dedicated to environmental remediation of closed military installations.
4 See CRS Report RL31005, Appropriations and Authorization for FY2002: Defense, by
Amy Belasco, Mary Tyszkiewicz, and Stephen Daggett, for details on the defense
authorization and appropriation process.
5 Article I, Section 9, Clause 7 of the U.S. Constitution.
6 See 10 USC 114.
7 The relevant subcommittees of the House and Senate Appropriations Committees are
Military Construction (for the military construction appropriation) and Defense (for the
national defense appropriation).
8 The Subcommittee on Readiness in the House Armed Services Committee and the
Subcommittee on Readiness and Management Support in the Senate Armed Services
Committee draft legislation to authorize military construction appropriations.

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The separate military construction appropriations bill dates to the late 1950s.
Traditionally, military construction was funded through annual defense or
supplemental appropriations bills. However, the Korean War prompted a surge of
military construction, followed by a steady increase in military construction
appropriations. Given the strong and enduring security threat posed by the Soviet
Union, a relatively high level of spending on military infrastructure appeared likely
to continue. The appropriations committees established military construction
subcommittees and created a separate military construction bill. The first stand-alone
military construction bill was written for FY1959 (P.L. 85-852).
Military construction appropriations are not the sole source of funds available
to defense agencies for facility investment. The defense appropriations bill funds so-
called minor construction and property maintenance within its operations and
maintenance accounts. In addition, construction and maintenance of Morale, Welfare,
and Recreation-related facilities are partially funded through proceeds of
commissaries, recreation user fees, and other non-appropriated income.
Several special accounts are included within the military construction
appropriation. Among these are the Homeowners Assistance Fund (Defense),9 and
the Department of Defense Family Housing Improvement Fund,10 both of which
perform functions ancillary to the direct building of military infrastructure.
Most funds appropriated by Congress each year must be obligated in that fiscal
year. Military construction appropriations, though, are an exception. Because of the
long-term nature of construction projects, these funds can generally be obligated for
up to five fiscal years.
Consideration of the military construction budget begins when the President’s
budget is delivered to Congress each year, usually in early February. This year, the
President submitted his FY2004 budget request to the Congress on February 3, 2003.
9 The Homeowners Assistance Fund (Defense) was established by the Demonstration Cities
and Metropolitan Development Act of 1966 (42 USC 3374). It authorizes the Secretary of
Defense to acquire the title to, or to reimburse for certain losses upon the sale of, one- and
two-family homes owned by federal employees located at or near military installations
ordered closed in whole or in part.
10 10 USC 2883 (Department of Defense Housing Funds) is part of subchapter IV
(Alternative Authority for Acquisition and Improvement of Military Housing) of the basic
law governing the armed forces. It establishes two independent funds: the Department of
Defense Family Housing Improvement Fund and the Department of Defense Military
Unaccompanied Housing Improvement Fund (unaccompanied members of the military are
either unmarried or are married but separated geographically from their families). The funds
are sustained by direct appropriation, fund transfers made by the Secretary of Defense or the
Secretary of the Navy from other accounts, proceeds from certain title conveyances or the
lease of federal military family housing property, or other financial activity associated with
either military family or unaccompanied housing. These funds may be used for the
planning, construction, or improvement of military housing as provided for under this
particular subchapter of Title 10.

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Bill Status
Table 1 shows the key legislative steps necessary for the enactment of the
FY2004 military construction appropriations. It will be updated as the appropriation
process moves forward.
Table 1. Status of Military Construction Appropriations, FY2004
Conference Report
Committee Markup
House
House
Senate
Senate
Conf.
Approval
Public
Report
Passage
Report
Passage
Report
Law
House
Senate
House
Senate
H.Rept.
06/26/03
S.Rept.
07/11/03
06/17/03 06/26/03
– –
– –
– –
– –
108-173
(428-0)
108-82
(91-0)
Notes: Dashes indicate no action yet taken.
Appropriations Action
House Appropriations Action. Following a series of hearings by the House
Subcommittee on Military Appropriations, the full Committee marked up its bill on
June 17. H.R. 2559 (H.Rept. 108-173) was introduced to the House on June 23,
2003, and placed on the Union Calendar (Calendar No. 88). The House considered
the bill under the provisions of a Special Rule (H.Res. 298) on June 26, 2003
(Congressional Record, H5979-5990). The measure passed by the Yeas and Nays:
428-0 (Roll no. 325).
The bill was received in the Senate the same day and placed on the Legislative
Calendar under General Orders (Calendar No. 177).
Senate Appropriations Action. The Senate Committee on Appropriations
Subcommittee on Military Construction held hearings on its bill during March and
April of 2003. The full Committee reported legislation (S. 1357, S.Rept. 108-82) to
the Senate on June 26. The bill was placed on the Legislative Calendar under General
Orders (Calendar No. 176).
On July 10, the Senate began consideration of H.R. 2559, striking all after the
enacting clause and substituting the text of S. 1357. The Senate passed the bill on
July 11 (91-0), insisted on its amendment, and requested a conference with the
House.
Changes in Funding Request During the Legislative Process
The President’s original budget submission for military construction totaled
$9,036,721,000.

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This was amended upward by the House Appropriations Committee to
$9,237,096,000 because of transfers from the defense appropriations bill11 to the
military construction appropriations bill and calculations performed by the
Congressional Budget Office (CBO) pursuant to an Administration request for a
general provision of funding related to the “Foreign Currency Fluctuations,
Construction, Defense” account. The funding transfers included $25,500,000 for the
purpose of constructing a Special Operations Forces facility and $119,815,000 for
chemical demilitarization construction. The CBO calculation resulted in a re-
appropriation of $55 million.
The Senate Appropriations Committee similarly amended the President’s budget
submission, including the transfer of funds for the Special Operations Forces facility
and the CBO calculation. It did not include the transfer of chemical demilitarization
construction funds from the defense appropriations bill. Therefore, the Senate version
of the budget submission is quoted as $9,117,281,000.12
Key Policy Issues
Several issues regarding military construction have gained visibility during the
legislative deliberations of the current session of Congress. Among these are overall
funding levels, realignment of overseas bases, base realignment and closure (BRAC),
and perchlorate ground water contamination remediation.
Overall Funding Levels. The FY2004 budget submitted by the President on
February 3, 2003, as subsequently amended, requested $9.24 billion in new budget
authority, an amount $1.46 billion below the 2003 enactment.
Realignment of Overseas Bases. The Department of Defense has initiated
efforts in Germany and in the Republic of Korea to reduce the number and shift the
locations of its permanent installations. Known in Europe as Efficient Basing-East
and in Korea as the Land Partnership Plan, they are part of a worldwide DOD effort
to transform itself into a lighter and more agile military establishment.
As part of this endeavor, the Secretary of Defense has tasked his combatant
commanders to review military construction projects in order that they might support
changing military objectives overseas. These commanders are required to submit a
basing plan that enhances their abilities to project power, to support operations, and
to conduct activities based upon the Secretary’s views of a military structure
transformed to meet the challenges of the 21st century. Based on the DOD study of
overseas basic requirements, the Administration in its amendment asked for the
deletion of 16 construction projects totaling $269 million that had been requested for
Germany and Turkey in its original FY2004 submission.
11 Rep. Jerry Lewis introduced the Defense Appropriations Bill (H.R. 2658, H.Rept. 108-
187) to the House on July 2, 2003, when it was placed on the Union Calendar (Calendar No.
96).
12 Fiscal Year 2004 request amounts shown in the tables of this report are taken from the
House version of the President’s budget submission.

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This DOD study is not yet complete, however, and the House Appropriations
Committee, in its report, expressed concerns that current and projected military
construction at overseas sites may not reflect a well-considered strategy. The
committee, noting that DOD has announced the retrenchment of some garrisons in
the Republic of Korea, recommended rescinding $107 million from prior year
appropriations at sites slated to be closed and re-appropriating them to installations
expected to remain in service.
The Senate Appropriations Committee strongly supported the DOD effort to
reevaluate its overseas basing requirements, though both appropriations committees
noted that a DOD overseas basing master plan, due on April 1, 2002, had not yet
been submitted. The Senate committee recognized that the DOD study of rebasing
had not progressed beyond its embryonic stage. In observing public statements
indicating that DOD would likely reduce the number of troops stationed in Germany
and would reconfigure its installations in Korea, it did not find much of the new
construction in Europe and Korea that had been requested in the May 1, 2003, budget
amendment.
The Senate Committee recommended that an eight-member Commission on the
Review of the Overseas Military Facility Structure of the United States be formed to
assess whether current overseas basing is adequate and assess the feasibility of
various new configurations. Appointed by congressional leadership, the Commission
would provide an independent view of overseas basing requirements and would
submit its report, including findings, conclusions, recommendations for legislation
and administrative action, and a proposed overseas basing strategy, to the President
and Congress by August 30, 2004. The Committee also directed the Department of
Defense to submit master plans for changing the military infrastructure requirements
within each overseas regional command and report annually, through FY2008, on the
plans’ implementation.
Notwithstanding congressional direction, the press has reported that the
Department of Defense and the military services have begun taking action to realign
force levels and the basing “footprint” at overseas locations.
On July 23, the Pacific Stars and Stripes, a newspaper written for military
members stationed throughout the Pacific area, announced that U.S. and Japanese
officials had entered into an agreement to return to Japanese control more than 700
acres of land near Yokosuka used by the American military.13 In return, the Japanese
government agreed to build 800 new residential housing units near the main
Yokosuka naval base.
In Europe, the press has reported that the U.S. European Command is
considering the closure of many of the military installations in Germany and the
return to the United States of many of the combat units now stationed there. New,
13 According the the report, all of the Fukaya Communications Site, Tomioka Storage Area
and Negishi Dependent Housing Area and most of the Kamiseya Communications Station
will be returned at a future date not yet determined. See Joseph Giordono, “Japan Pledges
To Build 800 Residential Units Near Yokosuka,” Pacific Stars and Stripes, July 23, 2003.

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more austere, bases could be constructed to house lighter, smaller combat units sent
more to train than to garrison. Countries where these “bare-bones” bases might be
located include Poland, Bulgaria, Romania, Algeria, and Morocco.14 A more recent
report in the press indicated that two of the Army divisions currently engaged in
operations in Iraq, the First Armored and the First Infantry Divisions, currently based
in Wiesbaden and Würzburg, Germany, could be permanently redeployed to the
United States when they are relieved of their present assignments.15
In the Republic of Korea during early June 2003, officials announced that U.S.
forces there would be realigned, with elements of the Second Infantry Division
currently based near the Demilitarized Zone between the Republic of Korea and the
Democratic Peoples Republic of Korea moving south, and the garrison at the
Yongsan Garrison in the capital city of Seoul beginning its relocation “as soon as
possible.”16
Base Realignment and Closure (BRAC). Four BRAC rounds have been
completed since the first in 1989. A fifth round, expected to affect as many
installations as the previous four rounds combined, is scheduled to take effect in
FY2005.
Under statutory language included in the National Defense Authorization Act
for FY2002, the Secretary of Defense is required to publish by December 31, 2003,
an initial list of the criteria he will use to recommend base closure and realignment
actions. The Secretary’s force structure plan, a comprehensive base inventory, and
certification that the BRAC round is needed are to be included with the presidential
submission of his FY2005 budget in early February 2004. Congress will have the
opportunity to disapprove the Secretary’s selection criteria during early 2004. The
final presidential list of BRAC actions is due to the Congress on November 7, 2005.17
The Efficient Facilities Initiative (EFI). Some press reports have referred
to the FY2005 BRAC round as the “Efficient Facilities Initiative.” This substitution
is inaccurate and has led to some confusion. In fact, BRAC and Efficient Facilities
Initiative are defined in statute and refer to two different processes.
14 See Brian Whitmore, “US Looks East To Set Up New Europe Bases,” Boston Globe, July
12,2003, p. 1.
15 See Amy Svitak and Vince Crawley, “Germany-Based Divisions May Move Stateside,”
Army Times, August 4, 2003, p. 14.
16 See Howard W. French, “Official Says U.S. Will Reposition Its Troops In South Korea.”
New York Times, June 3, 2003, Jeremy Kirk and Franklin Fisher, “Army: No Timetable For
S. Korea Move,” Pacific Stars and Stripes, June 10, 2003, and Seo Soo-min, “ROK, US
Agree on Fast-Track Force Realignment,” Korea Times, June 30, 2003. The U.S.
ambassador to the Republic of Korea has since cautioned that the redeployment of troops
from their current location in Seoul to their new positions will be slow, awaiting the funding
of necessary construction by the host nation and by the Congress. See Sim Sung-tae,
“Envoy: Redeploying Troops Takes Time,” Korea Herald, July 8, 2003.
17 For a comprehensive review of the BRAC process, see CRS Report RL30440, Military
Base Closures: Estimates of Costs and Savings
, by David E. Lockwood, and CRS Report
RL30051, Military Base Closures: Agreement on a 2005 Round, by David E. Lockwood.

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The original Efficient Facilities Initiative (EFI) was a new approach to reducing
and managing DOD real property holdings and was intended to substitute for a repeat
BRAC round. The EFI was intended to encompass all military installations, both
domestic and overseas, and would have instituted a different method of administering
many of the surviving bases.
The EFI was publicly announced by the Department of Defense on August 2,
2001, and the Department’s General Counsel submitted proposed legislation to
Congress on August 3. It included three major actions: the potential realignment and
closure of U.S. military installations overseas; the potential realignment and closure
of installations within the United States during FY2003; and the permanent
authorization of the Brooks Air Force Base Development Demonstration Project,
expanded to include all military services. The language as proposed was not adopted
by Congress.
Instead, Congress incorporated some aspects of the EFI into the National
Defense Authorization Act for FY2002.18 Because military bases on foreign territory
are established by agreement between governments, no legislation was needed to
begin the process of overseas bases. Congress ignored that portion of the EFI.
Instead of approving the Secretary’s suggested process for review of domestic bases
and establishment of a permanent Department-wide Brooks-like base management
system, Congress created the FY2005 BRAC round in Title XXX of the Act and
authorized DOD to carry out a “Pilot Efficient Facilities Initiative” for a maximum
of four years at up to two military installations of each military department (Army,
Navy, and Air Force). These pilot initiatives were to be modeled on the Brooks Air
Force Base Development Demonstration Project in San Antonio, Texas.
The Brooks Air Force Base Development Demonstration Project.
The Brooks Air Force Base Development Demonstration Project (also known as the
“Base Efficiency Project” or the “Brooks City-Base Project”) is a partnership
between the Secretary of the Air Force and the City of San Antonio, Texas, and
represents an alternative to traditional base closings or realignments.
Usually, military reservations are federal land jurisdictionally independent of the
surrounding communities and governed by the base commander. Congress authorized
the Secretary to “convert any military or civil service appropriated or non-
appropriated fund activity at Brooks Air Force Base, Texas, into a contracted activity
or an exchange of services compensated for by the lease, sale, conveyance, or transfer
of real or private property.”19 This empowered the Secretary to transfer title, in
exchange for appropriate compensation, of the whole of federal real property at
Brooks to the city and to lease back for military use those parts that directly support
the base’s military mission.20 The base is then no longer federal property. The cost
of maintaining and operating the facility’s physical plant, including fire and police
18 S. 1438 (P.L. 107-107). H.Rept. 107-333 is the bill’s conference report.
19 Defense Appropriation Act for FY2000 (P.L. 106-79) and Military Construction
Appropriations Act for FY2001 (P.L. 106-246).
20 This is often referred to as “sell and lease back.”

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protection, upkeep, and the like, is effectively transferred along with ownership from
the Department of Defense to the local community. Funds generated from the lease
or sale of property, reimbursements, and so on, is placed in a special Project Fund,
which the Secretary of the Air Force may employ for operations, leaseback,
maintenance and repair of Department facilities, and other uses.21
This has taken place at Brooks, and one aim of the EFI was to make the same
management tools available permanently to all service secretaries for use where they
considered appropriate. But Congress granted this authority only as a pilot project of
limited scope and duration. To date, the Department of Defense has not selected
candidate sites.
Perchlorate Groundwater Contamination Remediation. The Senate
Appropriations Committee included language in its report requiring the Department
of Defense to report not later than March 30, 2004, on the activities of the
Interagency Perchlorate Steering Committee of the Department of Defense. The
Steering Committee was established in January 1998 to facilitate the flow of
information between defense agencies on technological issues related to perchlorate
contamination of drinking water supplies and irrigation water supplies.
The report of the House Appropriations Committee on the defense
appropriations bill (H.R. 2658, H.Rept. 108-187) also addressed perchlorate
groundwater contamination. That Committee directed the Department of Defense to
conduct a joint study with the Environmental Protection Agency on perchlorate
contamination of water supplies in southern California, Arizona, and Nevada. This
report would be completed within 180 days of the enactment of the defense
appropriations bill and would recommend national groundwater contamination
standards, indicate the military and defense industry contamination sources, and
outline mitigation steps for which the federal government would be responsible.
Major Funding Trends
Between FY1985 and FY1998, funding devoted to military construction
declined steadily as DOD and Congress struggled with a changing strategic
environment, a shrinking military force, and the uncertainties associated with several
rounds of base realignments and closures. Appropriations began to rise with FY1998
as Congress sought to replace outdated facilities and improve the quality of life for
military personnel at home and in the workplace. Administration requests for military
construction funding (not including BRAC and family housing) continued to decline
until FY2000, but have risen for FY2001 and FY2002. The request for FY2004 rises
above the level requested for FY2003, and DOD projects that its annual construction
requests will approximately triple between FY2003 and FY2007 (see Figure 1).
21
More information on the Brooks City-Base Project is available online at
[http://www.ci.sat.tx.us/edd/brooks/].

CRS-10
Figure 1. Military Construction Funding
Prior to FY1994, Congress considered Administration requests to exceed real
construction requirements, typically appropriating less new budget authority than
requested. This pattern reversed with the FY1995 budget. Every year since then,
Congress has added to Administration requests, countering what Members have
termed “inadequate” funding for military construction.
Table 2 breaks down the FY2004 request by appropriations account and
compares it to FY2003 levels. Table 3 shows congressional action on current
military construction appropriations by account. Table 4 compares Administration
military construction requests and enactments for Guard and Reserve projects from
FY1994-FY2004.

CRS-11
Legislation
Military Construction Appropriations
H.R. 2559 (Knollenberg). Making appropriations for military construction,
family housing, and base realignment and closure for the Department of Defense for
the fiscal year ending September 30, 2004, and for other purposes. H.R. 2559 was
reported out of committee on June 17, 2003, and introduced to the House on June 23.
The bill passed the House on June 26, 2003 (428-0), and was sent to the Senate.
The Senate began consideration of H.R. 2559 on July 10, amending it by
striking all text after the enacting clause and substituting the text of S. 1357. On July
11, the Senate passed the bill (91-0), insisted upon its amendment, and requested a
conference with the House.
S. 1357 (Hutchinson). An original bill making appropriations for military
construction, family housing, and base realignment and closure for the Department
of Defense for the fiscal year ending September 30, 2004, and for other purposes. S.
1357 was reported as an original measure on June 26, 2003. The Senate began
consideration of H.R. 2559 on July 10, amending it by striking all text after the
enacting clause and substituting the text of S. 1357. All subsequent action is listed
under H.R. 2559.
Defense Authorization
H.R. 1588 (Hunter, by request).22 To authorize appropriations for FY2004 for
military activities of the Department of Defense, and for military construction, to
prescribe military personnel strengths for FY2004, and for other purposes. Introduced
on April 23, 2003, and referred to the Committee on Armed Services, it was further
referred to the Subcommittees on Projection Forces, Total Force, Readiness, Tactical
Air and Land Forces, Terrorism, Unconventional Threats and Capabilities, and
Strategic Forces. The subcommittees completed markup and returned the bill to the
full committee on May 9. The Subcommittee on Readiness, which exercises
jurisdiction over the military construction portion of the authorization bill,
recommended increasing the requested funding for construction and adopted (16-5)
an amendment sponsored by Representative Gene Taylor (Miss.-04) that would
repeal the FY2005 round of base realignments and closures. The measure was passed
out by voice vote. The bill was reported out on May 16, 2003 (H.Rept. 108-106), and
placed on the Union Calendar (Calendar No. 53). The committee filed a supplemental
report (H.Rept 108-106, Part II) on May 21. Brought to the floor on May 21, 2003,
subject to a rule (H.Res.245). H.R. 1588 was debated, amended, and passed by
recorded vote (361-68, Roll no. 221) on May 21 and 22. The bill was received in the
Senate on June 2, 2003, and on June 4 was laid before the Senate by unanimous
consent. The Senate struck all after the Enacting Clause and substituted the language
22 S. 2225 corresponds to the Administration’s budget request and was introduced by
request. H.R. 4546 and S. 2514 are the defense authorization bills from the House and
Senate Armed Services Committees respectively.

CRS-12
of S. 1050. The bill passed with an amendment by voice vote the same day
(Congressional Record, S7297-7364).The Senate then insisted on its amendment and
appointed conferees. The Senate sent a message to the House informing it of its
action on June 5, 2003.
Table 2. Military Construction Appropriations by Account:
FY2003-FY2004
(new budget authority in thousands of dollars)
FY2003
FY2004
FY2004
Account
Enacted
Request
Enacted
MilCon, Army
1,636,334
1,536,010
)
MilCon, Navy
1,351,888
1,132,858
)
MilCon, Air Force
1,201,266
830,671
)
MilCon, Defense-wide
866,669
814,116
)
Total: Active Components
5,056,157
4,313,655
)
MilCon, Army National Guard
241,377
168,298
)
MilCon, Air National Guard
203,813
60,430
)
MilCon, Army Reserve
100,554
68,478
)
MilCon, Navy Reserve
74,921
28,032
)
MilCon, Air Force Reserve
85,826
44,312
)
Total: Reserve Components
706,491
369,550
Total: Military Construction
5,762,648
4,683,205
NATO Security Investment Program
167,200
169,300
)
Family Housing Const., Army
275,436
356,891
)
Family Housing Operation & Debt, Army
1,106,007
1,043,026
)
Family Housing Const., Navy & Marine
373,816
184,193
)
Corps
Family Housing Operation & Debt, Navy
861,788
852,778
)
& Marine Corps
Family Housing Const., AF
676,042
637,718
)
Family Housing Operation & Debt, AF
864,850
834,468
)
Family Housing Const., Def-wide
5,480
350
)
Family Housing Operation & Debt, Def-
42,395
49,440
)
wide
DOD Family Housing Improvement Fund
2,000
300
)
Total: Family Housing
4,207,814
3,959,164
)
Total: BRAC Acct.
561,138
370,427
)
General Provision (CBO est.)
55,000
GRAND TOTAL
10,698,800
9,237,096
)
Source: Data for FY2003 Enacted and FY2004 Request from H.Rept. 108-173.
Note: Order of presentation of some accounts has been changed from previous edition of this report.

CRS-13
Table 3. Military Construction FY2004 Appropriations by
Account; Congressional Action
(in thousands of dollars)
FY2004
House
Senate
Account
Enacted
Request*
Bill
Bill
MilCon, Army
1,536,010
1,350,045
1,071,540
)
MilCon, Navy
1,132,858
1,171,755
1,156,337
)
MilCon, Air Force
830,671
896,136
1,056,377
)
MilCon, Defense-wide
814,116
780,933
679,887
)
Total: Active Components
4,313,655
4,198,869
3,964,141
)
MilCon, Army Nat’l. Guard
168,298
208,033
304,085
)
MilCon, Air National Guard
60,430
77,105
221,013
)
MilCon, Army Reserve
68,478
84,569
73,979
)
MilCon, Naval Reserve
28,032
38,992
34,742
)
MilCon, Air Force Reserve
44,312
56,212
57,426
)
Total: Reserve Components
369,550
464,911
691,245
Total: Military Construction
4,683,205
4,663,780
4,655,386
)
NATO Security Investment
169,300
169,300
169,300
)
Program
Family Housing Const., Army
356,891
356,891
356,891
)
Family Housing Ops & Maint,
1,043,026
1,043,026
1,043,026
)
Army
Family Housing Const.,
184,193
180,608
180,608
)
Navy & Marine Corps
Family Housing Ops & Maint,
852,778
852,778
852,778
)
Navy & Marine Corps
Family Housing Const.,
637,718
628,026
628,026
)
Air Force
Family Housing Ops & Maint,
834,468
826,074
834,468
)
Air Force
Family Housing Const,
350
350
350
)
Defense-wide
Family Housing Ops & Maint,
49,440
49,440
49,440
)
Defense-wide
DOD Family Housing
300
300
300
)
Improvement Fund
Total: Family Housing
3,959,164
3,937,493
3,945,887
)
BRAC Acct.
370,427
370,427
370,427
)
General Provision (CBO est.)
55,000
55,000
55,000
)
GRAND TOTAL
9,237,096
9,196,000
9,196,000
)
Sources: H.Rept. 108-173., S.Rept. 108-82.
Note: Order of presentation of some accounts has been changed from previous edition of this report.
* Data taken from H.Rept. 108-173.

CRS-14
Table 4. Congressional Additions to Annual DOD Budget
Requests for National Guard and Reserve Military Construction,
FY1994-FY2004
(current year dollars in thousands)
Total
Army
Air
Air
Change
Fiscal
National
National
Army
Naval
Force
from
Year
Guard
Guard
Reserve
Reserve
Reserve
Total
Request
1994 Req.
50,865
142,353
82,233
20,591
55,727
351,769

1994
302,719
247,491
102,040
25,029
74,486
751,765
+399,996
Enacted
1995 Req.
9,929
122,770
7,910
2,355
28,190
171,154

1995
187,500
248,591
57,193
22,748
56,958
572,990
+401,836
Enacted
1996 Req.
18,480
85,647
42,963
7,920
27,002
182,012

1996
137,110
171,272
72,728
19,055
36,482
436,647
+254,635
Enacted
1997 Req.
7,600
75,394
48,459
10,983
51,655
194,091

1997
78,086
189,855
55,543
37,579
52,805
413,868
+219,777
Enacted
1998 Req.
45,098
60,225
39,112
13,921
14,530
172,886

1998
102,499
190,444
55,453
26,659
15,030
390,085
+217,199
Enacted
1999 Req.
47,675
34,761
71,287
15,271
10,535
179,529

1999
144,903
185,701
102,119
31,621
34,371
498,715
+319,186
Enacted
2000 Req.
57,402
73,300
77,626
14,953
27,320
250,601

2000
236,228
262,360
110,764
28,310
64,071
701,733
+451,132
Enacted
2001 Req.
59,130
50,179
81,713
16,103
14,851
221,976

2001
285,587
203,381
108,499
61,931
36,510
695,908
Enacted
+473,932
2002 Req.
267,389
149,072
111,404
33,641
53,732
615,238

2002
400,994
250,530
165,136
51,676
74,013
942,349
+327,112
Enacted
2003 Req.*
101,595
62,406
58,779
58,671
37,976
319,427

2003
241,377
203,813
100,554
74,921
85,826
706,491
+387,064
Enacted*
2004 Req.
168,298
60,430
68,478
28,032
44,312
369,550
2004





Enacted
Source: Department of Defense, Financial Summary Tables, successive years, H.Rept. 108-173.

CRS-15
For Additional Information
CRS Products
CRS Report RL31310. Appropriations for FY2003: Military Construction, by
Daniel Else.
CRS Report RL31805. Authorization and Appropriations for FY2004: Defense, by
Amy Belasco and Stephen Daggett.
CRS Report RL31349. Defense Budget for FY2003: Data Summary, by Amy
Belasco and Stephen Daggett.
CRS Report RL31187. Combating Terrorism: 2001 Congressional Debate on
Emergency Supplemental Allocations, by Amy Belasco and Larry Q. Nowels,
CRS Report RL31305. Appropriations and Authorization for FY2003: Defense,
coordinated by Amy Belasco and Stephen Daggett.
CRS Report RL30002. A Defense Budget Primer, by Mary T. Tyszkiewicz and
Stephen Daggett.
CRS Report RL30440. Military Base Closures: Estimates of Costs and Savings, by
David E. Lockwood.
CRS Report RL30051. Military Base Closures: Agreement on a 2005 Round, by
David E. Lockwood.
CRS Issue Brief IB96022. Defense Acquisition Reform: Status and Current Issues,
by Valerie Bailey Grasso.
Selected World Wide Web Sites
Legislative Branch Sites
House Committee on Appropriations
[http://www.house.gov/appropriations/]
Senate Committee on Appropriations
[http://www.senate.gov/~appropriations/]
CRS Appropriations Products Guide
[http://www.crs.gov/products/appropriations/apppage.shtml]
Congressional Budget Office
[http://www.cbo.gov/]
General Accounting Office
[http://www.gao.gov/]

CRS-16
U.S. Department of Defense Sites
U.S. Department of Defense, Office of the Under Secretary of Defense (Comptroller),
FY2004 Budget Materials
[http://www.dod.mil/comptroller/defbudget/fy2004/index.html]
U.S. Department of Defense, Installations & Environment Home Page
[http://www.acq.osd.mil/ie/]
White House Sites
Executive Office of the President, Office of Management and Budget, Budget
Materials
[http://www.whitehouse.gov/omb/budget/fy2004/]
Office of Management & Budget
[http://www.whitehouse.gov/omb/]