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117783 1 (1982-03-05)

handle is hein.gao/gaobacxuh0001 and id is 1 raw text is: UNITED STATES GENERAL ACCOUNTING OFFICE WASHINGTON, D.C. 20548 ~jj~ COMMUNITY AND ECONOMIC DEVELOPMENT DIVISION MAR 5 1982 Mr. Charles E. Weithoner Associate Administrator, Federal Aviation Administration Department of Transportation 117783 Dear Mr. Weithoner: Subject: Need for Written Procedures to Guide FAA Staff in Preparing Certain Cost-Benefit Analyses At the request of Senator Gary Hart, we recently conducted a review of the Federal Aviation Administration's (FAA's) plan to close its Denver and Honolulu regional offices and consolidate them into offices located in Seattle and Los Angeles. The results of our review are summarized in the enclosed report, CED-82-45, dated February 25, 1982. We noted that while the cost-benefit analysis contained in FAA's September 1981 consolidation plan was generally accurate, cost estimates for early retirements, unemployment compensation, and lump-sum annual leave payments were not included. Although some of these items are not direct costs to FAA, they are costs to the Federal government and are directly related to the regional office consolidation. We believe these costs are proper offsets to FAA's projected savings and estimated them at about $4.6 million. In preparing any future cost-benefit analyses, all costs associated with consolidating offices and/or eliminating posi- tions should be recognized. This will ensure that FAA management has the most complete information on which to base decisions. We realize that some cost estimates may actual data is not available and assumptions used. FAA, nevertheless, should acknowledge mates using the best information available. unemployment compensation by using cost data sional Budget Office study. be highly uncertain because must be made or averages these costs and make esti- For example, we estimated from a July 1981 Congres- As far as we know, no written procedures are available to guide the FAA staff in preparing cost-benefit analyses associated with reorganiza- tions and/or elimination of positions. Accordingly, we recommend that such procedures be developed. (341038) i2~267 3f