Sequesters offer the illusion of a fair approach to the furlough of government personnel. But a closer look reveals that furloughing employees in a working-capital-funded organization, such as SPAWAR Atlantic, has the potential to increase government costs and penalize government employees, their customers and most importantly our warfighters.

To understand how such furloughs at SPAWAR could increase government costs and penalize our servicemen and women and veterans, we must understand SPAWAR Atlantic’s business model as a customer-supported government organization that operates much like a not-for-profit business. SPAWAR receives no direct appropriated funds from Congress, only customer funding from the Department of Defense and other federal agencies that understand the value of doing business with SPAWAR Atlantic.

My experience is that most folks do not understand this creative and efficient government business model. If SPAWAR does not get work from the Navy, other Armed Services or federal agencies to perform a specific task, it must lay off people, much like a business. It is a “get to” versus a “got to” for customers including Naval customers. If there is no work, SPAWAR will naturally go away or have to furlough employees. This market driven business model has been the secret sauce in creating “information dominance” for the joint warfighter through SPAWAR Atlantic. Customers in large part come to SPAWAR Atlantic because of the effectiveness and efficiency they gain. This variable cost business model is vital to future cyber challenges we face as a nation.

Furloughing SPAWAR Atlantic employees will delay the work that is already on the books. The tasking and funding is in place for this important “information dominance” work, which directly supports our country’s warfighters.

Without the furlough, SPAWAR would have experienced a generation of revenue from work in support of its customers, while simultaneously finding itself able to absorb related overhead fixed costs. When employees are furloughed, SPAWAR is unable to recoup any revenue as a result of each affected employee. In effect, the furloughs actually increase, rather than reduce, both taxpayer and Department of Defense costs.

Further, SPAWAR will need to increase its rate structure to make up this loss in overhead generated dollars. But SPAWAR has experienced significant growth by successfully lowering its rates due to executing more direct hours than planned and thus providing even more efficiency to its customers. That is what we all expect from government.

So what happens when you furlough a SPAWAR Atlantic employee? The customers lose, the warfighters lose, taxpayers lose, as do the civil servants and their families who have chosen this honorable career.

This indiscriminate approach demonstrates a lack of careful judgment that fails America’s warfighters and citizens by failing to provide the effective and just leadership they rightly deserve. Furloughs should not be undertaken merely to show consistency. I am sure there are places in the federal government that furloughs would save dollars, just not organizations like SPAWAR Atlantic.

As a former executive director of this organization, my heart goes out to all the “warfighter dedicated” employees at SPAWAR Atlantic who must wonder, “How does this externally imposed action make any sense?”


Legare Street