GAO-11-318SP: Defense: DOD should assess costs and benefits of overseas military presence options before committing to costly personnel realignments and construction plans, thereby possibly saving billions of dollars

Defense

DOD should assess costs and benefits of overseas military presence options before committing to costly personnel realignments and construction plans, thereby possibly saving billions of dollars

Why Area Is Important

 

Overseas presence provides operational capabilities and demonstrates a commitment to our allies. In addition to the costs of supporting ongoing combat operations, the Department of Defense (DOD) spends billions of dollars annually on its network of installations around the world. For example, according to data provided by the military services, between fiscal years 2006 and 2009 the military services obligated $17.2 billion for the installations they manage in Europe. These obligations do not include funds obligated by other DOD organizations that use those facilities, overseas contingency funding, or personnel costs. Further, the military services estimated a requirement of $24 billion through fiscal year 2015 to build, operate, and maintain these installations. In light of current fiscal challenges facing the country, questions have arisen about the magnitude of overseas basing projects and costs, and whether DOD's planned investments support a coherent and affordable strategy. GAO's prior work has shown that DOD has taken positive steps to improve its planning for overseas infrastructure, but continues to devote insufficient attention to costs or analysis of alternatives.

What GAO Found

 

Having U.S. troops stationed overseas provides benefits, such as deterring aggression against U.S. allies, but permanent stationing may come at significantly higher costs than other alternative approaches such as deploying domestically stationed forces when needed. GAO's work since 2006 has found a systemic lack of cost information used to inform DOD's planning for its overseas infrastructure. As a consequence, DOD and Congress lack reasonable assurance that overseas presence is being planned and implemented in a cost-effective and financially sustainable way. Reliable and complete cost estimates are critical to allow analyses of alternatives and oversight by decision makers.

 

Since 2008, DOD has taken steps to develop regional plans for its overseas infrastructure, but department guidance regarding these posture plans has not required comprehensive cost information to support this emerging process. Recognizing the considerable costs involved with stationing forces overseas, in August 2010 the Secretary of Defense identified DOD's overseas presence as an area for review. Among other concerns, the Secretary of Defense questioned the growth in the number of general and flag officers across the department, highlighting that the U.S. European Command maintains four-star service component headquarters more than 20 years after the end of the Cold War and the vast majority of their fighting forces have departed from the region. Recent GAO reports have identified several evolving elements of DOD's global infrastructure, which have the potential to cost—or possibly save—the department billions of dollars depending on decisions DOD and Congress make. For each of these decisions, reliable, complete cost data will be invaluable to the ability of decision makers to choose among available options. For example:

  • Plans to reduce forces in Europe are being reconsidered.DOD recently held up the planned return of two Army brigades from Germany pending an announcement of the North Atlantic Treaty Organization's strategic concept as well as the results of ongoing U.S. assessments of the global defense posture. GAO's work has shown that leaving these two brigades in Europe could cost DOD between $1 billion and $2 billion over 10 years compared to bringing the forces back to the United States. In addition, the Army plans to continue to invest in a new Army headquarters in Germany even though the Secretary of Defense has questioned the size of U.S. European Command and its associated service component commands, and DOD may ultimately return some forces to the United States. U.S. European Command and service officials noted that forward military presence in Europe provides important but difficult-to-quantify benefits, including commitment to the North Atlantic Treaty Organization. Recognizing this, in September 2010, GAO recommended that DOD reassess its alternatives for Europe, weighing the costs of the presence against its perceived benefits to ensure DOD takes a cost-effective course of action. DOD officials agreed with this recommendation and noted that certain actions have already been undertaken, and DOD is currently conducting a broad review of the European theater.
  • Efforts to establish military presence in Africa have met with concerns.DOD has few facilities in Africa, but Camp Lemonnier in Djibouti houses a 2,000-person joint task force as well as supports other U.S. and multinational missions such as building the security capacity of partner states, at a cost of about $238 million in 2010. However, as GAO reported in April 2010, the task force's future is uncertain because it relies on overseas contingency operations appropriations. Moreover, the task force's original war-fighting mission has evolved to civil affairs missions like drilling water wells and building schools, and needs to be reassessed. Efforts to date have not always yielded the intended results or were sometimes poorly coordinated with other U.S. agencies. It is uncertain where DOD will ultimately place a headquarters for U.S. Africa Command, which it designated as being fully operational in 2008. DOD had planned to locate the headquarters in Africa but stepped back from those plans after some African nations raised concerns. The command currently occupies temporary facilities in Stuttgart, Germany, and has postponed its decision on a permanent headquarters until 2012.
  • Substantial costs are anticipated for enduring locations in Iraq, Afghanistan, and other locations in southwest Asia.Supporting the continuing operations in Iraq and Afghanistan is DOD's priority, and its regional presence includes installations in Kuwait, Bahrain, and Qatar, among other nations. While DOD has made progress executing the drawdown, challenges remain that could impact DOD's ability to close bases in Iraq as planned. GAO has begun work to examine how much DOD's presence in the region will cost moving forward relative to the potential benefits and what other alternatives to current plans may exist.
  • Large and costly realignment is being undertaken in Asia.DOD has several major initiatives under way in the Pacific region that represent a significant restructuring and transformation of the U.S. military presence in Asia. For example, DOD plans to increase the U.S. military presence on Guam from about 15,000 in 2009 to more than 39,000 by 2020, which will increase the current island population by about 14 percent over those years. GAO has previously reported that the reported costs for these and other posture initiatives may be significantly understated. GAO is examining the scope, magnitude, management, and costs associated with DOD posture initiatives in Asia, as well as the extent to which DOD has incorporated cost and benefit analysis into its decision-making process. GAO plans to report the results of its analysis in early 2011.

GAO has made recommendations since 2006 that DOD gather more comprehensive cost data and report it to Congress; in general, DOD has generally agreed with these recommendations but has yet to implement them in full. As a result, initiatives are proceeding without assurance that the efforts are being undertaken in a cost-effective way.

Actions Needed

 

Given the significant resources being dedicated to building and maintaining DOD's global presence, DOD needs to ensure it is routinely assessing the benefits of its overseas presence relative to the cost of maintaining that presence. Specifically, DOD should conduct a comprehensive reassessment of its overseas presence, including the costs and benefits of various alternatives.

To address the specific regional issues in Europe and Africa, GAO has issued a number of recommendations that DOD generally agreed with including reassessing:

  • plans in Europe, including the costs and benefits of keeping Army brigades in Germany and the appropriateness of building a new Army headquarters given the potential changes in force structure; and
  • missions of the combined joint task force in Djibouti as well as identifying the projected costs for the task force and, in concert with DOD or the Navy, developing a realistic funding plan for the task force's sustainability.

The financial stakes are high for DOD, since according to DOD data the department has obligated billions of dollars annually to build and maintain its global network of installations. A thorough consideration of alternatives and an assessment of their costs and benefits could help DOD shape its future overseas investments and ensure long-term affordability. Savings or cost avoidances would be dependent upon the nature of changes made to DOD's plans and how DOD implements its chosen options.

Framework for Analysis

 

The information contained in this analysis is based on the related GAO products listed under the "Related GAO Products" tab.

Area Contact

 

For additional information about this area, contact John Pendleton at (404) 679-1816 or pendletonj@gao.gov or Brian Lepore at (202) 512-4523 or leporeb@gao.gov.

Related GAO Products