Budget and Spending:

High-Level Leadership Needed to Help Guam Address Challenges Caused by DOD-Related Growth

GAO-09-500R: Published: Apr 9, 2009. Publicly Released: Apr 9, 2009.

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In an effort to improve the U.S. military's flexibility to address conventional and terrorist threats worldwide, the Department of Defense (DOD) plans to relocate more than 8,000 Marines and an estimated 9,000 dependents from Okinawa, Japan, to Guam as well as expand other U.S. force capabilities on the island at an estimated cost of more than $13 billion. Guam is an integral part of DOD's logistical support system and serves as an important forward operational hub for a mix of military mission requirements. According to DOD, Guam provides strategic flexibility, freedom of action, and prompt global action for the Global War on Terrorism, peace and wartime engagement, and crisis response. DOD plans to begin construction on Guam during fiscal year 2010 in order to meet the desired buildup deadline of fiscal year 2014 indicated in the agreement reached by the U.S.-Japan Security Consultative Committee on October 29, 2005. As a result of the military buildup, Guam's current population of 171,000 will increase by an estimated 25,000 active duty military personnel and dependents (or 14.6 percent), to 196,000. In addition, the realignment will require additional workers to move to the island, including non-defense personnel, DOD contractors, and transient military personnel. As such, the U.S. military realignment and buildup will substantially impact Guam's community and infrastructure. DOD and representatives for Guam have expressed concern that Guam's infrastructure and social services will not be prepared to handle the impacts of the buildup by the 2014 completion date because of the compressed timeline and the extensive impact of the buildup. Further, GAO previously reported that the Government of Guam faces significant challenges in addressing the impacts of the buildup and realignment. Although DOD plans to fund infrastructure requirements directly related to the military buildup and realignment as well as contribute some funds toward civilian infrastructure requirements such as utilities and roads, the Government of Guam is largely responsible for obtaining funding for civilian requirements related to the buildup. In a May 2008 hearing before the Senate Committee on Energy and Natural Resources, the Governor of Guam stated that approximately $6.1 billion would be requested for fiscal year 2010 to help fund Guam's needs in support of the military buildup. GAO has reported that most communities affected by such defense actions, with far lower requirements than Guam, were likely to incur significant costs for infrastructure and were seeking federal assistance. Guam is similarly seeking extensive federal aid across many federal agencies. Both DOD and the Department of the Interior have worked to raise awareness across the federal government of the need to address the systemic challenges to support both the construction effort and the long-term impact of stationing additional forces on Guam as well as to coordinate interagency budgets by identifying Guam's core requirements and matching up those requirements with potential federal agencies that may be able to provide the necessary resources to address Guam's critical social services and infrastructure needs. Section 2822(b) of the Duncan Hunter National Defense Authorization Act for Fiscal Year 2009 required us to report on the status of interagency coordination through the Interagency Group on Insular Areas (IGIA) of budgetary requests to assist the Government of Guam with its budgetary requirements related to the realignment of U.S. military forces on Guam. Our objective was to determine the status of interagency coordination including the status of the IGIA's participation in that coordination.

The IGIA has made some efforts at federal collaboration; however, it will be unable to affect interagency budgets to help ensure that the realignment of military forces on Guam will be completed by the fiscal year 2014 completion date because it does not have the authority to direct other federal agencies' budget or other resource decisions. However, based on a series of executive orders dating back to 1978, it has been long-standing DOD policy that DOD take the leadership role within the federal government in helping communities respond to the effects of defense-related activities. The current version of the executive order, Executive Order 12788, establishes an Economic Adjustment Committee made up of 22 federal departments and agencies, including the Department of the Interior, and requires the committee to, among other duties, advise, assist, and support the Defense Economic Adjustment Program. This program is to assist substantially and seriously affected communities from the effects of major defense closures and realignments. Moreover, the program is also to serve as a clearinghouse to exchange information among federal, state and community officials involved in the resolution of community economic adjustment problems, including identifying sources of public and private financing to meet identified needs. While DOD, through the Economic Adjustment Committee, does not have the authority to direct member executive agencies' budget or other resource decisions, Executive Order 12788 does specify that all executive agencies are to give priority consideration to requests from defense-affected communities for financial resources and other assistance. However, as we previously reported, the Office of the Secretary of Defense has not provided the high-level leadership on the Economic Advisory Committee that is necessary to help ensure interagency and intergovernmental coordination at levels that can make policy and budgetary decisions to better leverage resources through the committee. Although other federal assistance has been provided to Guam from organizations such as the Navy's Joint Guam Program Office and Interior's Office of Insular Affairs, these organizations do not have the authority to direct other federal agencies to provide resources to defense-affected communities or ensure that Guam's budget requests related to the military buildup become a priority across the federal government. Only high-level leadership from the Secretary of Defense can marshal the resources of the Economic Adjustment Committee's member agencies, and only high-level federal officials from these agencies can affect possible policy and budget decisions that may be required to better assist the communities.

Recommendation for Executive Action

  1. Status: Closed - Implemented

    Comments: The Economic Adjustment Committee met on February 25, 2010 with one agenda item, listening to community concerns related to the military buildup on Guam. As a result of this meeting, requirements and estimated costs to provide needed infrastructure on Guam were brought to the attention of EAC committee members who now have a better basis to resource their assistance programs.

    Recommendation: As DOD implements our June 2008 recommendation, the Secretary of Defense should direct the Under Secretary of Defense for Acquisition, Technology, and Logistics to ensure that as the Economic Adjustment Committee meets, as mandated by Executive Order 12788, the committee should routinely consider Guam's requests for assistance to support the challenges arising from the military buildup or other requests as appropriate.

    Agency Affected: Department of Defense

 

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