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overhead now runs $15.4 million per year. By 1964 our goal is to reduce this expenditure at least to $8.7 million.

Third, to meet this objective, we must perform all of our storage, maintenance, and distribution work in the Western States in the smallest number of depots which it is militarily sound to maintain. The smallest practical number has been found to be two for general supplies and maintenance. For reasons of military preparedness these two should also have capacity to store a duplicate range of general supplies as well as ammunition and

weapons-so that if one is knocked out the other can carry on the mission, When the hard test of which two to retain was applied, it was found that, good as they are, our two coastal depots (Mount Rainier and Benicia) do not qualify. I believe you will be interested in the detailed comparisons and alternatives which were considered in this painful process of elimination. Comparison of Tooele and Sierra with Mount Rainier

As you know, the Tooele Ordnance Depot, located near Salt Lake City, Utah, has been selected as the main depot for the consolidation. It will be backed up by Sierra Ordnance Depot located at Herlong, Calif. Why were two inland depots chosen and our two coastal depots eliminated ?

First, because the two inland depots are the only ones having the total capacity required. We need a total of 4.6 million square feet of covered storage space for general supplies. Tooele, with 3.7 million square feet has the largest covered storage area in the West. Sierra is the second largest with 2.8 million square feet and is ideally suited as the backup to Tooele both for reasons of size and location. Mount Rainier has less than half the required space, while there is room at Rainier to build additional storage space to do so would duplicate the huge excess capacity already in being.

Second, we wanted to choose locations for the major and the backup depots which have ammunition and weapons storage capacity adjacent to the general supply storage areas. Here the need for peacetime and mobilization requirements is 7.7 million square feet. Tooele is the largest ammunition storage depot in the West, and Sierra is one of the remaining largest. Mount Rainier does not have ammunition storage capacity. This is very expensive construction-about $25 per square foot. At the suggestion of the Washington State delegation we investigated last Saturday the availability of such storage at Bangor Naval Ammunition Depot to determine whether this facility might be linked with Mount Rainier so as to consider Rainier as one of the two depots to be retained. We found that Bangor has 937,000 square feet of excellent ammunition storage but that it is 85 percent utilized for naval ammunition and is designed primarily for outloading rather than for bulk storage.

Third, as you know, we are anticipating a problem of greatly increased explosive hazards in maintaining future solid propellent missiles where the propellant cannot be separated from the missile components during period of inspection, repair, assembly, and test. Based on recommendations of the Army Ordnance Missile Command, it has been determined that a detached area measuring 2 miles by 3 miles should be provided for safety protection purposes. This is about 4,000 acres. Both Tooele and Sierra each hare virtually unlimited desert-type acreage with detached facilities in place to house such an activity. As you know, the entire area now occupied by Mount Rainier is 1,300 acres. General Train informs us that this large a tract cannot be taken out of the Fort Lewis complex without impairing his training mission which involves about 22,000 men year-round and up to twice this number during the summer period.

Fourth, we realized that by concentrating our ordnance depot activities in fewer locations we must be alert to the problems of vulnerability to attack. This factor we found to be highly in favor of the remote locations of Tooele and Sierra since neither is in a strategic target area.

Another desirable aspect of the two locations selected is the dry climate, which results in low maintenance expenses. The above comparisons are not intended to imply that the two locations selected are free of penalties. They obviously pose problems, each of which we have studied.

One is the problem of distance since Tovele is located from 700 to 900 miles from coastal shipping points. This distance does add 4 days to normal ship ping time by freight to the port of Seattle and 3 days to San Francisco. This

will cause customer points to anticipate their needs by a few more days. However, Salt Lake City is a hub of communications and transportation throughout the Western States and daily overnight freight service is available, as well as excellent air service. Furthermore, my own study revealed the surprising fact that we will incur little if any cost penalty by routing all shipments through Tooele. This is because of intransit rate privileges on carload shipments, the fact that there will be more opportunities for carload shipments when stocks are consolidated, and the fact that many of our shipments are made by parcel post. Furthermore, under periods of mobilization, much of our material would move direct from production points to dockside, by passing storage points altogether.

Another obvious problem is the need to build up at Tooele specialized tools, equipment, and personnel skills, such as those for electronic repair, and operation of automatic data processing equipment. This buildup will take place gradually over the 3-year period, using existing equipment and personnel skills to the maximum possible extent. While this will initially be an added cost, when accomplished our costs and staffing requirements will

be significantly reduced. Altogether the complete phaseout of both Mount Rainier and Benicia- including relocation of personnel and their families, retraining expense, payment of terminal leave, shipment of parts, supplies, and equipment-will cost about $12 million in one-time expense over the next 3 years. Outfitting of facilities at Tooele will cost an estimated $617,000 in addition. However, these one-time costs will be paid off in the first 6 months after phaseout, and net savings of approximately $28 million per year will be realized each year thereafter, distributed as follows:

In millions

Overhead costs_
Supply operations.-
Maintenance operations---

$6.7

8.3 12.9

Total--

27.9

About 45 percent of these savings will accrue from the movement of the Mount Rainier workload to Tooele, and the balance from the movement of the Benicia workload. In addition to these recurring annual savings, it is anticipated, as mentioned earlier, that the Mount Rainier property will be productively utilized by the Fort Lewis supply and maintenance activity, and that new construction expenditures of approximately $4 million per year will be obviated.

CONCLUSION

In summary, studies begun in late 1957, verified by personal inspection of top Army officials and last week by myself and members of my staff, have confirmed the soundness of the decision to shrink back the size of the ordnance depot system in the seven Western States. By reason of existing capacity, it has been found that Tooele and Sierra are best suited for retention. To assure an orderly transition, with minimum impact on employees and the community a 3-year phaseout period is planned. One-time costs of approximately $12.6 million will be paid off from savings in the first 6 months after phaseout, and recurring savings of $28 million annually will be realized thereafter.

C. SPECIFIC COMMENTS ON REPORT OF MAY 8, 1961 by Thomas D. MORRIS

This section includes specific comments relative to the closure of Mount Rainier Ordnance Depot as discussed by Thomas D. Morris, Assistant Secretary of Defense (Supply and Logistics) in report of May 8, 1961, entitled “Discussion of Plans to Deactivate Mount Rainier Ordnance Depot as Part of a Total Program to Reduce Depot Operating costs in the Seven Western States."

On pages 2 and 3 of the above report, Mr. Morris discusses three reasons for the decision to phaseout the Mount Rainier Ordnance Depot installation. Comments upon the reasons given are offered below after quoting in part, the reasons as given in the report.

"First, we are now using about half the capacity of the six depots and within the next 4 years we will need only about one-third of our depot capacities in the

The reason for this is the fact that we have cleared out the big surplus stocks left over from World War II and Korea and have developed ways of operating with smaller inventories."

western area.

Comment

The report indicates the capacity of Mount Rainer Ordnance Depot for general storage space as 1,814,000 square feet and estimates a total requirement for the western area of 4,600,000 square feet within the next 4 years. Using other ammunition depots as a reserve there is sufficient space available to utilize for distribution mission and at the same time fulfill the requirements of Fort Lewis without new construction. Additional saving would accrue by not moving sup plies to either Tooele or Sierra. Likewise, this is true of maintenance capabilities.

"Second, a large fixed overhead is required just to keep a depot open. By consolidating activities, overhead costs can be substantially reduced. Our overhead now runs $15.4 million per year. By 1964 our goal is to reduce this expenditure at least to $8.7 million." Comment

Inasmuch as the facilities at Mount Rainier Ordnance Depot are going to be used by Fort Lewis, there will be no appreciable reduction in fixed overhead costs insofar as the Department of the Army is concerned. Selecting the depots with relatively highest fixed overhead costs for closure makes the most sense. Mount Rainier is recognized as having the lowest fixed overhead costs.

"Third, to meet this objective, we must perform all of our storage, maintenance, and distribution work in the Western States in the smallest number of depots which it is militarily sound to maintain. The smallest practical number has been found to be two for general supplies and maintenance. For reasons of military preparedness these two should also have capacity to store a duplicate range of general supplies as well as ammunition and weapons—so that if one is knocked out the other can carry on the mission." Comment

Since it is in the plan to utilize some of the facilities of Mount Rainier Ordnance Depot for Fort Lewis needs, in which case there will be no significant reduction in fixed overhead costs, it appears the present missions of Mount Rainier Ordnance Depot can also be continued in combination with the increase in anticipated needs of Fort Lewis. The anticipated reduction in needed capacity for ordnance depots over the next 4 years in the western area can be effectively handled at Mount Rainier by gradual application of any excess capacity at Mount Rainier to serve the additional requirements of Fort Lewis. In this manner all facilities and capacity of Mount Rainier can be used most efficiently by serving in a dual capacity as required. Thus careful consideration should be given to retaining Mount Rainier Ordnance Depot as one of the two depots proposed to be maintained for general supplies and maintenance-in combination with Umatilla, Oreg., for required area ammunition storage space. Comparison of Tooele and Sierra with Mount Rainier

Pages B-3 and B-4, of the report, first and second items.-Certain advantages would accrue as a result of consolidation at Tooele Ordnance Depot. However, as there is a requirement for all existing ammunition storage capacity in the western region, no particular advantage or savings will result from storing in just two depots. In addition, storage facilities at Mount Rainier Ordnance Depot have 427,000 square feet of dehumidified storage not available at any of the other depots except in storage tanks.

It is conceded that no ammunition storage of conventional type should be built at Mount Rainier as there is sufficient capacity at present ammunition depots. The only additional requirements at Mount Rainier are for storing of missiles returned for rebuild and test. Facilities for storing should be those presently in use. History of World War II as pertains to ordnance indicates that isolated communities, such as Tooele and Sierra, have great difficulty in securing or maintaining skilled technicians capable of repairing these missiles. No mention of the availability of skilled personnel is contained within this report. This is one of the most important factors.

Page B-4, third item.-Page B-4, third item pertains to the need for a detached area measuring 2 by 3 miles for safety protection purposes in anticipation of increased explosive hazards in maintaining future solid propellant missiles. Is pointed out elsewhere, it is believed adequate land area could be made available on the Fort Lewis Reservation adjacent to the present Mount Rainier Ordnance Depot site.

Other comments

Problem of distance.-Tooele is located a considerable distance from the port and does add 3 days transportation time to San Francisco and 4 days to Seattle. What is the increased pipeline inventory cost that will result from extension of transportation? Intransit rate privileges are included in outbound shipments. This is not true of retrograde shipments and repair and maintenance of supplies are in most cases retrograde movement and the additional costs occasioned by this retrograde should be included as a cost of the consolidation.

Modification of facilities.-In his report of May 8, 1961, Thomas D. Morris estimates the outfitting of the Tooele facilities would cost about $617,000. In his letter to Senator Magnuson of May 10, 1961, Morris stated it would cost $617,000 to modify facilities at Tooele for receiving, inspection, and classification, including an area for destruction of missiles. No reference is made to the additional costs of construction or modification that will be necessary to provide facilities for repairs of missiles, and storage for distribution mission which include:

(1) Automatic data processing
(2) Stock control
(3) Loose issue (bin) operations
(4) Shipping (packing and packaging)
(5) Care and preservation
(6) Box and crate

(7) Inspection and classification
Facilities for these items are not currently in existence at Tooele.

CONCLUSIONS

In conclusion, it is recognized in the May 8, 1961, report by Thomas D. Morris relative to the plan to deactivate Mount Rainier Ordnance Depot that Mount Rainier Ordnance Depot has been carrying a major part of the workload of the six western ordnance depots as an efficient, low-cost, favorably located installation.

With high ratings accorded Mount Rainier by the Army survey teams relative to factors of transportation to customers, type of construction of shops and warehouses, suitably of administration and operations buildings, efficiency of depot maintenance facilities and skilled manpower, coupled with the fact that fixed overhead costs to the Army will not be substantially reduced by closure due to continued use by Fort Lewis, it appears important to continue the Mount Rainier installation. Actually the two depots-Mount Rainier Ordnance Depot and Tooele Ordnance Depot complement each other. Mount Rainier is essentially an efficient distribution and maintenance mission and Tooele is an ideal ammunition and general supply reserve center.

D. GENERAL INFORMATION ABOUT MOUNT RAINIER ORDNANCE DEPOT AND Its

CLOSURE

1. Mount Rainier Ordnance Depot is the most modern ordnance general supply depot (does not have ammunition storage) west of the Rockies. Conventional ammunition facilities available at Bangor and Umatilla.

2. Of its 13 major operations buildings (all permanent or semipermanent construction) 7 are modern, permanent structures less than 10 years old. The others have been renovated to meet changing conditions.

3. MROD has more diversified storage facilities for general supplies than Tooele. There are 1,890,000 gross square feet of covered storage space on the depot, with sites available to double this capacity without constructing additional rail, road, and other facilities. 4. MROD is adjacent to excellent port facilities :

(a) Port of Tacoma 13 miles away.
(0) Port of Olympia 19 miles away.
(c) Port of Seattle 35 miles away.

(d) Port of Portland 130 miles away 5. Closest port facilities to Tooele :

(a) Port of San Francisco 786 miles away.
(6) Port of Los Angeles 800 miles away.

(o) Port of Seattle 1,114 miles away.
6. MROD is 1,100 miles closer to Alaska than is the Tooele site.

7. Closure of MROD would cost the Fort Lewis-MeChord defense complex the present advantage of fast close-by supply. MROD is strategically located to give immediate support to the following forces upon which the Nation and the people of the Northwest will depend in emergencies: (a) The 41st National Guard Division (Guardsmen from Washington and

Oregon).
(6) The Ath Division (one of the three STRAC forces in the United

States).
(c) The 25th Air Division at McChord Air Force Base.

(d) The 7th Region Brigade commanding all missile sites in this area. 8. It would cost the National Guard $3,600 to ship one M-48 tank to Tooele for major repairs, and return.

9. Twenty-seven percent of MROD business is with Fort Lewis, largest Army installation in the West.

10. Twenty percent of MROD business is directed to support of Alaska through Puget Sound ports.

11. There is sufficient undeveloped and relatively unused land area immediately behind MROD to safely handle modern missile weapons.

12. MROD is nondisposable land area. It can only be used for military purposes in accordance with the land lease deed. Unless other military agencies can make use of MROD facilities valued at $18 million, they will be placed in standby status.

13. MROD is immediately adjacent to McChord Field and a MATS (military airfreight) terminal. Defense of our country could depend on immediate supply to our oversea and Alaska military units.

14. MROD is not sitting on the doorstep of another duplicate distribution depot, as is Tooele. Pueblo Ordnance Depot is only 500 air miles away from Toole.

15. Trained personnel are available at MROD. 16. Transcontinental rail lines switch directly into MROD without backhaul charges.

17. Maintenance and operation of buildings and facilities are less costly in the Tacoma area than in the Tooele area.

18. MROD has the versatility of facilities to handle a general supply depot mission. Why not improve logistic supply to the fighting forces of the Northwest and Alaska instead of worsening them? E. FUNCTIONS, PERSONNEL, WORKLOADS, SPECIFICATIONS FOR COMPARISON OF

ORDNANCE DEPOTS 1. The functions of the Mount Rainier Ordnance Depot are:

(a) Receipt, storage, and issue of ordnance general supplies for the States of Oregon, Washington, Idaho, Montana, and Alaska. Reserve for overseas through Pacific coast terminals. Maintains accountability and responsibility for ordnance stocks at this Depot.

(6) Maintenance function. Repair tanks, trucks, combat vehicles, conventional fire control material, small arms, tires, tubes and related items, tools and vehicular armament. Repairs electronic fire control systems, both Nike and Hercules missiles.

(c) Performs calibration of ordnance electronic test equipment and calibration standards for the area served.

(d) Winterization center for equipment being forwarded to Alaska and the Arctic Test Branch as required.

(e) Prepares manuals and inspection standards for Nike and Hercules systems and missiles.

(f) Returned material. Retrograde movement of reparable or excess supplies from the areas served together with other areas of the Pacific as directed by the Chief of Ordnance.

(g) Other activities. Western assembly area for deployment of Nike equipment to the Pacific.

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