DOD comptroller defends furloughs for ‘working capital’ employees
Karl Pearson, an Arsenal assembler and benchman, putting the finishing touches on a cannon tube.
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We’re self-supporting, self-sufficient. Furloughs won’t save money… It’s just going to take us longer to produce what they are buying from us.”
WASHINGTON — Laurie Vroman’s expenses rose this summer because of day care for her three children, but her paycheck will drop by hundreds of dollars because of Defense Department-wide furloughs that began this week.
Vroman, who will stay home from work without pay on Friday, is part of a group of about 180,000 DOD civilians who some federal legislators doubt need to be furloughed at all.
In a letter to Defense Secretary Chuck Hagel last month, a bipartisan group of 31 House members questioned whether furloughing the department’s working capital fund employees — whose salaries are paid not by Congressional appropriations, but by customers who purchase goods and services from them — would save any money or was even legal.
Vroman, a 31-year-old single mother, said the orders that pay her salary are already in, and she and her colleagues are working to fill them. She works in the contracting office of Watervliet Arsenal, just north of Albany, N.Y., which specializes in producing cannons and other artillery equipment.
Watervliet, like other working capital fund entities, operates much like a business and is supported by revenue from customers such as the Army.
“We’re self-supporting, self-sufficient,” Vroman said. “Furloughs won’t save money… It’s just going to take us longer to produce what they are buying from us.”
But in a response this week sent to legislators who voiced similar concerns, DOD Comptroller Robert F. Hale said working capital fund furloughs are not just legal, they will save the department $500 million this year as the service branch cut their orders for goods and services.
“These working capital fund personnel savings provide us the flexibility to adjust maintenance funding downward to meet higher-priority needs,” Hale wrote. “The Air Force, for example, currently expects to reduce funded orders in their working capital funds by about $700 million to meet higher-priority needs while the Army expects to reduce orders by $500 million.”
Officials say that in total, furloughing about 650,000 DOD civilians for up to 11 days this year will save $1.8 billion and shore up operations and maintenance accounts running low after sequestration slashed the Pentagon budget by $37 billion.
A senior defense official speaking on the condition of anonymity said that as orders drop, slowing down work through furloughs will effectively give employees something to do in the future while saving money for the working capital funds now. In addition to arsenals, working capital funds sell fuel to the military, run maintenance depots and provide services such as accounting and systems administration.
“We’re actually smoothing the workload over time,” the official aid. “The work that exists to be done — the orders that we already have — will still have to be done unless the customers cancel them.”
But the Democratic congressmen who wrote the letter to Hagel is questioning Hale’s justification of working capital fund furloughs.
“There remain significant questions about the Department’s legal and economic justifications,” said Rep. Derek Kilmer of Washington state, in a written statement. “I will continue to work with my colleagues to ensure that these workers are afforded their rights and are able to provide cost-effective service vital to enhancing our military’s readiness.”
While various Pentagon officials have repeatedly stressed the furloughs would be carried out in an “across-the-board” way to ensure maximum fairness as DOD seeks to cut costs, Vroman said there’s nothing fair about furloughing workers if their economic pain doesn’t directly benefit DOD coffers — but does cause delays in delivery of needed goods and services to the military.
“I love being able to support the troops overseas now that I’m a civilian,” she said. “What bothers me the most is that (the furlough of arsenal workers) isn’t saving any money, but it is adversely affecting the warfighters.”