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Veterans Administration: Proposed Consolidation of Philadelphia and St. Paul Insurance Offices

机译：退伍军人管理局：建议合并费城和圣保罗保险办公室

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The report reviews the Veterans Administration's (VA's) cost-benefit analysis of a proposal to consolidate its insurance operations by merging the St. Paul office with the Philadelphia office. VA estimated that during the first 5 years, the consolidation would save $3.94 million. On a discounted basis (estimated present value of future costs and savings), VA estimated 5-year savings of $2.4 million. The GAO questions the validity of VA's estimated savings because (1) those for personnel cost were made primarily on the basis of lower salaries in Philadelphia without consideration that at the time of the analysis, Philadelphia's productivity level was lower and (2) those for space cost in Philadelphia to accommodate the St. Paul operations were not included. The authors believe that VA's estimated 5-year savings would be greatly reduced or could be eliminated if (1) the Philadelphia office's future productivity is similar to its current productivity and (2) office space cost was included. VA does not agree with them.

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