As the Pentagon leans harder on state and local governments to run services at military installations, the Government Accountability Office has concluded the Defense Department lacks key oversight mechanisms for a growing share of those arrangements. The watchdog report, summarized by legal publisher VitalLaw, traces an expansion in intergovernmental support agreements that has outrun the safeguards around them.
The numbers grew fast. Active agreements climbed from 45 in 2018 to 316 by December 2025. Army installations account for 192 of them, roughly 61 percent of the total, and the deals cover everything from utilities and grounds upkeep to waste handling, transport, environmental work and equipment repair.
Savings Nobody Checked
Guidance from the services requires cost-benefit analyses before an agreement is signed, yet says nothing about how to judge deals spanning multiple installations or branches. Of four multi-installation agreements GAO examined, early savings estimates often rested on a single project or site. Five of six multi-service agreements were executed with no cost-benefit analysis at all.
The Army’s umbrella deal with Sourcewell, a Minnesota governmental cooperative, generated 402 task orders. GAO counted 101 that showed no documented financial benefit or cost comparison, and in 49 of those the Army also failed to record any nonfinancial benefit.
Verification is thinner still outside the Army. The Navy, Marine Corps and Air Force have no procedures for checking whether projected savings match actual results; their cost data stays at the installation level. One Navy arrangement with the University of Hawaii was pegged at roughly $10 million a year with about $1.1 million in expected annual savings. University officials told GAO no task orders had been completed through February 2026, so the estimated 2025 costs and savings never materialized.
Contractors in the Shadows
Who actually performs the work is largely unknown. The services collect little or no information on labor used under the agreements and generally fail to record whether private contractors are involved, something officials said no statute requires them to track. A review of 21 single-installation agreements found contractor participation in nine.
Wages drew the sharpest congressional attention. Because these agreements sit outside the McNamara-O’Hara Service Contract Act, GAO compared five public-sector positions against comparable statutory rate determinations. The spread ran from 19 percent under to 50 percent over the comparable rates. A paralegal post carried a minimum of $23.92 an hour against a comparable $28.89, a driver $15.36 versus $18.98, and an emergency medical technician post $16.37 versus $18.84. The stormwater specialist role, at $39.84, sat well above its $26.64 counterpart. GAO stressed the analysis was illustrative and not a definitive legal conclusion.
Capitol Hill Reacts
The top Democrat on the House Education and Workforce Committee, Robert C. “Bobby” Scott, said the findings showed the department was using these agreements to bypass the Service Contract Act despite worker-protection concerns. Representative Lucy McBath, who joined the review request, pointed to the three of five examined jobs that paid less than the statute would have required and to the unverified savings estimates.
GAO issued five recommendations, among them new guidance for estimating costs on multi-installation and multi-service deals and verification procedures for the Navy and Air Force. The Defense Department generally agreed and laid out planned corrective actions.
