FORT BELVOIR, Va. (Defense Logistics Agency Public
Affairs) -- The Defense Logistics Agency (DLA) has announced the
final decision on the public-private competition for warehousing
functions at 68 Defense Reutilization and Marketing Service (DRMS)
sites in the United States, including Hawaii.
The decision by the DLA Administrative Appeal Authority
confirms the selection of the government's Most Efficient Organization
Ralph Elliot, a DRMO Material
Examiner and Identifier, uses a forklift to offload items at
DRMO Sparta. (Photo by
The tentative decision to retain the functions in-house rather
than award to a private-sector company was announced June 30. The
tentative decision was made after a detailed public-private
competition indicated it was more cost effective for the competed
functions to be retained by the government than to be converted to
The DLA Administrative Appeal Authority received and considered
appeals of the tentative cost comparison decision from GENCO
Infrastructure Solutions, Inc., Resource Consultants, Inc., the DRMS
MEO and employees at the Defense Reutilization and Marketing Office (DRMO),
Selfridge, Army National Guard Base, Mount Clemens, Mich.
All appeals were filed with the DLA Administrative Appeal
Authority on or before Aug. 17. After a thorough review of the issues
appealed, the Appeal Authority stated that the appeals did not
identify sufficient problems with the challenged issues such that the
tentative cost-comparison decision might be considered unsupported or
in error. The Appeal Authority determined that the tentative cost
comparison decision is correct and has issued a final determination
showing that the cost comparison favors government performance.
To be eligible for consideration, an appeal must identify
noncompliance with requirements and procedures set forth in Office of
Management and Budget (OMB) Circular A-76, the guidance governing the
public-private competition, or specific items entered on the
Linda Smothers (left), DRMO
Sparta site manager, and Marjean Christy, a DRMO Property
Disposal specialist, conduct an inventory at DRMO Sparta. (Photo
by Rob Schuette)
The projected five-year gross savings resulting from this
decision is $45.4 million, or a 47.9 percent reduction of the costs
associated with the warehousing functions currently performed at the
DRMS sites. The competed functions currently
are being performed by approximately 300 federal and contractor
employees. Implementation of the MEO's proposal will result in
warehousing operations being consolidated to 18 sites.
It was determined by the MEO that DRMO Sparta, which is located
at Fort McCoy, would become a "stand-alone" operation or a
nonimpacted site, according to Linda Smothers, DRMO Sparta site
manager. The transition time frame for DRMO Sparta is to be in full
performance by July 5, 2006.
Very little change is expected to occur at Fort McCoy because
of the decision, other than possibly different faces in the stock,
store and issue area, Smothers said. The DRMO will serve the same
generating activities that it has in the past, and no property will be
shipped out of Fort McCoy to another DRMO warehouse.
The MEO has determined that DRMO Sparta is scheduled (as of
now) to have two part-time employees working in the warehouse. The
DRMO located at Wright-Patterson Air Force Base in Ohio will be the
hub under which DRMO Sparta will fall
for supervision and guidance. The remaining government
organization will retain two employees, who will serve as Disposal
Service representative and Site Leader/Quality Assurance personnel.
A complete listing of competed, reduced operations, and
consolidated sites is available at the Web site http://www.dla.mil/public_info/drmsA76.pdf.
Other DRMS services such as hazardous and scrap property disposal are
not expected to be diminished or directly affected by the warehouse
The announcement is the result of a public/private competition
using the guidelines of Office of Management and Budget Circular A-76
(Revised 1999), "Performance of Commercial Activities"
(A-76). DRMS announced these functions were undergoing an A-76 study
Oct. 9, 2001.
The A-76 competition process is the prescribed method for
deciding whether to retain recurring commercial activities within the
government or contract them out to the private sector. It also is a
fair and effective tool for achieving the savings and efficiencies
needed to continue to provide affordable and reliable disposal
The DRMS mission involves disposal of excess property,
including hazardous materials, received from the military services,
with the highest emphasis placed on protecting the public and
maintaining full environmental compliance. Property is first offered
for reutilization within the Department of Defense (DoD), transfer to
other federal agencies or donation to state and local governments and
other qualified organizations. Additionally, DRMS manages the DoD
surplus property sales program. Excess property that is not
reutilized, transferred or donated may be sold to the public as
surplus. DRMS has a worldwide presence within DoD, with disposal
specialists in 15 foreign countries, the U.S. Territory of Guam and 39
DRMS, a field activity of the Defense Logistics Agency
(DLA), has its headquarters in Battle Creek, Mich.
DLA provides supply support, and technical and logistics
services to the military services and to several civilian agencies.
Headquartered at Fort Belvoir, Va., DLA is the one source for nearly
every consumable item, whether for combat readiness, emergency
preparedness or day-to-day operations. For more information about DLA,
visit the Web site at http://www.dla.mil.