Navy Nuclear Power Training Command, Orlando, FL; Charleston, SC Page: 3 of 729
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The Honorable Rebecca Cox
June 13, 1995
Page 2
based on certified data, nor has the Navy provided any
explanation or details of how the estimates were arrived at. As
recently as last week I submitted a letter to the Secretary of
the Navy expressly requesting a breakdown of how they arrived at
these estimates. Obviously these numbers effect the 20 year cost
savings reduced to net present value and are discussed on pages
four and five in the enclosed report.
The COBRA analysis discussed on page two of the report for
retaining NNPTC in Orlando as reflected in the print out in
Appendix A assumes that the annual operating costs at Orlando and
Charleston would be the same. In this case Orlando would have a
cost savings over 20 years at net present value of $157.5 million
compared with Charleston's $71.1 million. The reason this COBRA
run made this assumption is because in discussions with Navy
personal at NNPTC in Orlando and the still existing staff at NTC
Orlando I could not find any rational basis for the original
estimated differences in annual operating costs let alone these
new figures presented on Charleston and New London.
But to put this in perspective I asked our folks to do a COBRA
analysis comparing Charleston and Orlando on the basis of the
Navy's latest estimates. The net result is that using these new
figures brings the 20 year cost savings at net present value of
redirecting NNPTC to Charleston up to $151.2 million from $71.1
million. At the same time the differential presented between
Charleston and Orlando in annual costs by this latest estimate
would convert a $157.5 million 20 year savings by keeping NNPTC
in Orlando to a $12.4 million cost over the twenty year period in
net present value. I am enclosing for your reference the
shortened version of two COBRA runs that reflect what I have just
said. Also enclosed is a COBRA run on a move to Charleston that
does not use the $162 million fictional cost avoidance so you can
see the 20 years break even.
Now before you jump to any conclusions I want to bring to your
attention the bottom line that does not change in all of this
juggling of annual operating cost estimates by the Navy. The
onetime cost to locate NNPTC at Charleston remains $147 million.
The onetime cost to keep NNPTC in Orlando remains $8 million.
Does it make any sense to spend $147 million up front to
reconstruct what we already have in Orlando when in real terms it
takes 20 years to reach a break even on return o investment? I
don't think so.
Regardless of the Navy's new annual operating cost numbers I
believe our case remains strong. At the same time I would
certainly like to see the Navy's justification for the numbers
they are using in their operating costs estimates in all three
locations. I encourage you to prod DBCRC staff to help us get
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Navy Nuclear Power Training Command, Orlando, FL; Charleston, SC, text, Date Unknown; (https://digital.library.unt.edu/ark:/67531/metadc26812/m1/3/: accessed April 23, 2024), University of North Texas Libraries, UNT Digital Library, https://digital.library.unt.edu; crediting UNT Libraries Government Documents Department.