item personnel I have talked about. This shop will maintain equipment valued in excess of $225 million assigned to the division, and other on- and off-post units. The degree of maintenance encompasses repair of unserviceable components that go into the third and fourth echelon maintenance category, that is just short of the fifth echelon, which is a complete rebuild capability which would not exist on post. In addition, the consolidated shop would perform the same degree of maintenance on all types of equipment, such as electronics, all the weapons, construction equipment; that is, bulldozers, graders, chemical equipment, materials handling equipment, such as forklifts, every other type of equipment assigned to this post. I have here, sir, Mr. Christensen, who is quite familiar with this consolidated field maintenance shop, and I would like to have him come forward and answer any questions the committee may have. Senator INOUYE. Fine, sir. Did the concept of this consolidated field maintenance shop originate in the field or is this a product of some management study? Mr. CHRISTENSEN. It is a product of a management study. It dates back to May 1962. It is related with the Army's more recent project, Project ARM, Army Ready Material. It is one of a number of actions, to improve Army Ready Material. In this regard we remembered the NIKE missile era at which time we combined three former technical service type of maintenance activities in order to support a missile system. This proved very successful not only from the point of ready material but from the point of economies and efficiencies of operation. We were able to cross-fertilize skills of various personnel in one building under one manager, resulting in more effective utilization of tools, diagnostic equipment, and productivity. Remembering this particular effort in the missile field, in the Army reorganization in 1962, we felt this was an opportune time to combine the former technical services individual shops located on an installation, and in those hard or permanent installations where our World War II type facilities were inadequate and required replacement, we should make our initial effort here to design an ideal concept of a consolidated shop utilizing the latest industrial engineering practices in order to reach this objective from the point of economy, avoiding duplication of tools, skills, personnel, and improved material readi ness. We did not have an in-house capability to determine this from an industrial engineering point of view. We did contract, in fact, with three different industrial engineering firms. In the case of Fort Carson, our priority here was to provide them with a facility as soon as possible. I would like to call it our prototype facility, and if we are successful in this effort it will probably be the first of a number of other to replace inadequate shops at other permanent installations where primarily division type forces are stationed. This industrial engineering firm has proven in their approach (in their contract, a little over $192,000 which we felt was money well expended), that we will reduce personnel staffing roughly 30 percent, we will increase productivity approximately 42 percent, we will reduce the overall construction square footage requirement-I cannot give you the exact figure, but it is roughly 44 percent less square footage than if we were to build individual shops for individual type commodities. Senator INOUYE. I would assume you have discussed this concept with the field commanders? Mr. CHRISTENSEN. Oh, yes, sir. Very highly advertised. Senator INOUYE. Did they show enthusiasm over this concept? Mr. CHRISTENSEN. Very much so. The Continental Army commander has at both of his annual conferences had the Army commanders and their staffs at these conferences. It is the popular subject of discussion. We have already reported over $3 million in cost savings just by consolidation within existing facilities. To take an example, at Fort Ord, Calif., and I think this is a very good example, they were most ambitious. They had one or two rather good semipermanent or permanent facilities, rather large. They had a great number of World War II type, very inadequate, poorly arranged buildings. They were able to consolidate into approximately three buildings on that post, and have realized something like $700,000 savings by just consolidating within two or three fairly efficient buildings. Senator INOUYE. Will the amount of $5,980,000 be the entire cost of the shop or will we have additional phases? Mr. CHRISTENSEN. This is the entire cost of the shop. I will agree that there is a certain amount of equipping or tooling that is not properly chargeable to this program. It is a very smaÏÏ amount however, compared to the $5,980,000. Senator INOUYE. You just made a statement that this is a prototype, and if this is approved that you will be requesting similar shops for other areas. Mr. CHRISTENSEN. Yes, sir. Senator INOUYE. How many will you schedule and what would the entire program cost? Mr. CHRISTENSEN. Sir, at this point in time we are proposing a program change proposal, in fact as of yesterday I slipped that proposal to August. Designs costs as such for 1967 are fairly secure; 1968, 1969, and 1970, of course, are less secure. We have selected approximately 10 installations, most of which are divisional type installations. The other installations are where we have very high priority missions located or specialized type missions. These are the installations when we feel we must replace shops with new facilities. They do not have adequate facilities or the facilities are just too small for the mission they now have. Senator INOUYE. What is the estimated total cost of all these 10 or 11 facilities? Mr. CHRISTENSEN. Subject to correction, I believe it is in the neighborhood of $70 million. General SHULER. This is also a part, Mr. Chairman, of the $3.4 billion problem I talked about earlier. This is a part of this replacement problem in general. Senator TOWER. With the implementation of this concept do you expect considerable savings over the long pull, and increased efficiency? General SHULER. Yes, sir. Mr. CHRISTENSEN. Very much, sir. Senator TOWER. Isn't something similar being undertaken in the Air Force or do you know? Mr. CHRISTENSEN. I do not know, sir. Senator TOWER. Thank you, Mr. Chairman. Senator INOUYE. Senator Cannon? Thank you very much, sir. FORT BENJAMIN HARRISON, IND. General SHULER. The next station, sir, is Fort Benjamin Harrison on page 125. We are asking for four line items, a hospital, an officer's field ration mess, conversion project; bachelor officer quarters, and conversion of a building to post exchange use. The first item on page 126, the hospital, is a repetitive item. This is a 40-bed hospital, sir, which will support about a total of 14,396 people, counting military personnel, retired military, and dependents on and off the post. Again this would replace a World War II mobilization type hospital, which is very large, 95 separate 1-story wooden buildings located over a large acreage, 61 acres, a firetrap, and this permanent hospital would give us a proper facility at this installation, sir. Senator INOUYE. General, will you furnish the committee information or comparisons between the cost of constructing an Army hospital, a public health hospital, a private hospital, and other service hospitals? General SHULER. We certainly will, sir. I am just trying to see how quickly we can do that, sir, for you. We will provide that, sir, as fast as we can. Senator INOUYE. Thank you, sir. (The information referred to follows:) Many factors must be considered in comparing hospital costs, whether the costs refer to civilian or military medical facilities. These factors are complex and relatively unique for each medical facility considered. Hospitals are constructed for a projected mission and certain specific functions. Therefore, to compare the relative costs on a per bed basis is not meaningful. This can be illustrated by comparing on this basis the cost of a small hospital serving a community, a regional hospital serving a group of civilian communities, or a medical center for highly specialized care and teaching. Likewise, this cost of hospitals on a per bed basis becomes even more divergent when the hospitals are constructed for specific functions, such as, tubercular hospitals, psychiatric hospitals, obstetrical hospitals, teaching hospitals, and general hospitals. For example, a study published by the American Hospital Association revealed that in a group of 200-bed hospitals the area per bed varied from 428 square feet per bed to 997 square feet per bed. This is a variance of over 100 percent. Military and civilian hospitals are not directly comparable on a cost-per-bed basis because the missions and functions are entirely different, and the size of the facilities required to satisfy these missions are therefore quite different. The mission of the civilian hospital is generally oriented toward inpatient care. Outpatient care in the civilian hospital is minimal, if included at all. Conversely the military hospital has expensive outpatient facilities included within the hospital structure. These facilities include doctor's offices, dental clinics, pharmacy, optical clinics, and other special clinics dealing in outpatient care. These requirements are usually satisfied in the civilian community by locating them in private offices or separate medical clinics which are operated by the doctors completely separate from the hospital. Thus, the outpatient and clinical facilities are much more extensive in a military hospital than might be found in a civilian hospital of a similar bed size. Generally over 20 percent of the space in a military hospital is devoted to outpatient clinical facilities that are normally nonexistent in a civilian hospital. The military hospital additionally has some functions which are entirely military in character and to which no counterpart may be found in a civilian hospital. Examples of this would be the preventive medical section, the physical examination section, and the extra space required in the hospital food service area due to the fact that the hospital military detachment uses this facility. These facilities generally represent over 10 percent of the area of a military hospital. Other factors having direct bearing on the cost differential between hospitals include: 1. The amount of equipment that is included as a part of the construction cost. As an example, in many cases civilian hospital equipment is bought from different funds or perhaps donated by individuals or organizations. Fixed equipment is included in the cost of military hospitals. 2. Costs which are attributable to site preparations or site conditions such as the availability of utilities, need for roads, parking, walks, landscaping, seeding and planting. As an example, some of these costs may be municipally borne in the case of civilian hospitals whereas they are all included in the cost of military hospitals. 3. Costs of construction vary according to the area in which the facility is being constructed. This differential might be quite significant in the case of a military hospital being constructed at a remote location. In summary, the military hospital has a broader mission than its civilian counterpart in the area of outpatient care and has unique military requirements which result in the need for more space thus escalating the apparent cost per bed. The Bureau of the Budget circular A-57 establishes the procedures for the programing and review of all Federal hospital projects. One of the purposes of these procedures is to insure effective management and budgetary appraisal of proposals for Federal medical care facilities. All Army hospitals in this bill have been reviewed in great detail. Their sizes or scopes are based upon specific workload requirements. The costs have been reviewed against the cost experience of civilian hospitals as well as other Federal hospitals. Possibly the only feasible way to compare hospital construction costs is on a square-foot basis. Again care must be exercised to insure these costs are prepared on the same basis. In order for the Bureau of the Budget to objectively review the cost estimates for military hospitals, they make an analysis each year of the cost of construction of civilian hospitals under the Hill-Burton Act. Based upon their analysis of civilian hospital costs for 36 projects, the adjusted average cost per square foot was $29.61. Adjusting this unit price to include supervision, inspection, and overhead, as done by the military services, this adjusted cost would be $31.97, or approximately $32. The cost per gross square foot of the hospital buildings to the 5-foot line of the military hospitals in the fiscal year 1966 program are as follows: 1 Ankara unit cost under normal construction procedures would be $29.70: the increase of $1.50 per square foot is to reduce foreign exchange costs to a minimum. Since other Federal hospitals receive the same review and approval as the military hospitals under the procedures set forth in the Bureau of the Budget circular A-57, it is presumed that the actual costs would be the same if they were adjusted to the same basis of cost as the military hospitals. In the case of the Veterans' Administration hospitals, it is understood that the supervision, administration, and overhead of the construction are not included in the unit prices given below. Also, it should be pointed out that these Veterans' Administration hospitals are larger hopsitals than the military hospitals memtioned above; therefore, there should be some reduction in cost. Hospital Veterans' Administration: San Antonio, Tex--- Northport, L.I., N.Y_---- U.S. Public Health Service: Indian Hospital, Belcourt, N.Dak_ Costs per gross square foot $24.47 28.05 39.42 29.56 General SHULER. The next line item on Fort Benjamin Harrison, page 127, is the conversion item, officers' field ration mess. This will provide messing, sir, messing facilities for permanently assigned officers, temporary duty student officers, and qualified civilian students at this post. This proposes to convert a structurally sound permanent building constructed in 1908. The cost of this work is less than 60 percent of the cost of a new facility. Presently the requirement is being met by utilizing a deteriorated and temporary enlisted men's mess, and greatly overcrowding the officers' mess on the post. This is related, sir, to the post exchange item on page 129, and I would like to say something about that now. This involves alterations to building No. 669, which is presently the post exchange. It is located in the center of the Bachelor Officer Quarters area now. This means that the bachelor officers would have a convenient place to eat in their area. The project which I will come to a little later, which proposes to move the post exchange into building 32 is now in the center of the shopping area, that is, the building is. That is where the post office, the bank, and the commissary are and, therefore, would be the proper locations for the post exchange. Naturally, if we do not get one of these projects we cannot go ahead with the other. In other words, we have got to move the post exchange out and into its building in this project before we can convert the building now occupied by the post exchange to an officers' field ration mess. Senator INOUYE. I notice from notice from your statement that you have qualified civilian students. Who are these people? Mr. FOSTER. Mr. Chairman, there are now two, and there will be three, administrative type schools at this post; the Adjutant General School, the Finance School, and the Defense Information School. These teach skills in which Government career civilian employees also find a career pattern, and so a small percentage of the student body will be Government career civil servants. Senator INOUYE. They are civil servants? Mr. FOSTER. That is correct, sir. Senator CANNON. General, I am intrigued by the fact that your two big items here are your hospital and your bachelor officer quarters, and you show very low priority. Is this base in much better shape than the rest of them or is it because of the mission or just what? On the hospital, for example, on your list you show this as a show this as a priority of sixth place out of six hospitals. In other words, it is in last place, and the bachelor officers' quarter's you show have a priority of 10th with only |