Defense Management: More Reliable Cost Estimates and Further Planning Needed to Inform the Marine Corps Realignment Initiatives in the Pacific
Highlights
What GAO Found
The Department of Defense's (DOD) preliminary cost estimate for its current realignment plan is not reliable, because it is missing costs and is based on limited data. According to DOD officials, DOD has not yet been able to put together a more reliable cost estimate because it will not have specific detailed information on the plan's requirements until the completion of environmental analyses and host nation negotiations. Currently, DOD estimates that it would cost approximately $12.1 billion to implement its realignment plan--not including the Australia segment of the realignment. Still, GAO found that DOD did not include some up-front practices that could have provided a more reliable estimate that are not dependent on the completion of the environmental analyses and host nation negotiations. Specifically, DOD omitted any costs associated with mobility support, a critical component of the implementation, from its cost estimate. Furthermore, although DOD based its cost estimate on several assumptions, there was no evidence DOD conducted analysis needed to determine the reliability of those assumptions. Without a reliable estimate, DOD will not be able to provide Congress and other stakeholders with the information Congress needs to make informed decisions regarding the realignment.
DOD has not developed an integrated master plan for its current realignment plan, and it has not developed a strategy to support the development and oversight of the Japanese construction projects associated with other realignment initiatives. DOD has taken initial steps to develop an integrated scheduling document based on currently known data, but indicated that specific requirements, schedules, and costs cannot be formalized in an integrated master plan until several studies and host nation negotiations are completed, which will take several years. Developing a master plan could enhance the management of the realignment by creating a systematic approach to planning, scheduling, and execution. In addition, DOD has not developed a strategy that identifies the resources needed to support the development of and oversight for these projects. According to best practices, a strategy identifies goals and resources and supports the implementation of a program. Without the information contained in an integrated master plan and a construction support strategy, Congress will be unable to make informed decisions about the order in which it needs to provide funding to support the realignment.
DOD has taken some steps to plan for the sustainment of U.S. forces on Okinawa and Guam, but it has yet to fully identify sustainment needs and costs for both locations during this period. At several installations on Okinawa, some of the infrastructure has severely deteriorated. DOD facilities planning guidance calls for updated facility master plans that capture requirements and propose solutions. On Guam, DOD has been maintaining an inventory of unoccupied family housing that could potentially be used for Marines relocating to Guam. However, DOD has not determined all the costs and benefits of maintaining this housing or the Marines' potential housing requirements--information needed to perform an economic analysis. Without an estimate of the sustainment requirements for Okinawa, the costs for maintaining housing, and the potential Marine requirements for housing on Guam, DOD will be unable to make informed decisions on whether continued investment in sustaining these facilities is warranted.
Why GAO Did This Study
DOD has stated that it intends to rebalance its defense posture toward the Asia-Pacific region. Japan hosts the largest U.S. forward-operating presence in this region; the majority of the U.S. forces in Japan are located in Okinawa. The United States and Japan planned to reduce the U.S. military presence on Okinawa by relocating approximately 9,000 Marines. DOD had originally planned to move the Marines only to Guam, but revised its plans in 2012 to include other locations in the Pacific. Congressional committees have directed GAO to examine DOD's initiatives in the Pacific, focusing on planning and costs. This report discusses the extent to which DOD has (1) developed a comprehensive cost estimate for the realignment of Marines, (2) planned for and synchronized other movements to coincide with the realignment, and (3) identified plans to sustain the force until all initiatives are implemented. To address these objectives, GAO reviewed relevant policies and procedures, reviewed and analyzed cost documents related to the realignment initiatives, interviewed DOD officials, and conducted site visits at U.S. military installations in the Pacific.
Recommendations
GAO recommends that DOD develop more reliable cost estimates and an integrated master plan for the realignment of Marines, develop a mechanism to share annual updates on the status of each, and identify sustainment requirements for affected facilities until realignment initiatives are complete. DOD generally agreed with GAO's recommendations.
Recommendations for Executive Action
| Agency Affected | Recommendation | Status |
|---|---|---|
| Department of Defense | To provide DOD and Congress with more reliable information to inform investment decisions associated with the realignment of Marines and U.S. military posture in the Pacific, the Secretary of Defense should update the current cost estimate to include additional estimates for mobility support, and additional analysis that would quantify the risk impacts and parameters to account for its various assumptions changing. Furthermore, as appropriate environmental analyses and host nation negotiations are completed, update the estimate with comprehensive cost estimates (as identifiable) that factor in and include the following seven cost components associated with the current realignment plan: (1) Guam Physical Layout and Requirements; (2) Housing Requirements on Guam; (3) Requirements to Upgrade Utilities and Infrastructure on Guam; (4) Joint Training Range Complex Requirements including associated environmental mitigation in the Northern Marianas; (5) Marine Corps Requirements for Australia; (6) Marine Corps Requirements for Hawaii and Other U.S. Locations; (7) Mobility requirements to support the current realignment plan to conduct routine operations, training, and any contingency situations. |
In a follow-on report issued in April 2017 (GAO-17-415), we reported that DOD has further developed cost estimates for Guam to include several key cost components, and we were able to compare DOD's cost estimates for Guam to the best practices of all four characteristics of a reliable cost estimate as identified in GAO's Cost Estimating and Assessment Guide. Moreover, we reported that DOD completed a cost estimate for the relocation to Hawaii in December 2014 and completed two cost estimates for the establishment of a rotational presence in Australia in February 2015 and January 2016. These actions meet the intent of our 2013 recommendation. As noted in subsequent recommendations made in our April 2017 follow-on report, while DOD made improvements to its cost estimate, additional actions are still required for DOD to develop reliable cost estimates for relocation actions in Guam, Hawaii, and Australia.
|
| Department of Defense | To provide DOD and Congress with sufficient information to make informed decisions about the sequencing of projects supporting the realignment of Marines and the interdependent projects on Okinawa and about the timing for the funding needed to simultaneously support these projects and those already planned on mainland Japan, the Secretary of Defense should, as the master planning process continues over the next several years, require the Secretary of the Navy to develop annual updates on the status of planning efforts for appropriate congressional committees until such time as master plans are completed for each geographic segment of the realignment. These updates should include, but not be limited to, providing congressional committees with up-to-date information on the status of initiatives, identified requirements and time frames, and any updated cost information linked to specific facilities or projects. |
Subsequent to our report, DOD began providing quarterly update briefings on the progress of realignment activities and updated requirements to congressional staff from relevant personal offices, as well as to professional staff of the Armed Services and Appropriations Committees of both the House and the Senate. Consistent with our recommendation, these briefings included providing congressional committees with up-to-date information on the status of initiatives, identified requirements and time frames, and any updated cost information linked to specific facilities or projects. By conducting these congressional briefings, congressional decision makers will have information to make better informed decisions about the sequencing of projects supporting the realignment of Marines and the interdependent projects on Okinawa and about the timing for the funding needed to simultaneously support these projects and those already planned on mainland Japan.
|
| Department of Defense | To provide DOD and Congress with sufficient information to make informed decisions about the sequencing of projects supporting the realignment of Marines and the interdependent projects on Okinawa and about the timing for the funding needed to simultaneously support these projects and those already planned on mainland Japan, the Secretary of Defense should direct the Secretary of the Army to require the Army Corps of Engineers to coordinate with appropriate military service officials involved in the planning and management of Defense Policy Review Initiative (DPRI) projects in Japan, including U.S. Forces-Japan, Marine Corps Installations Pacific, and Marine Corps Headquarters, to develop a strategy to identify how the design and construction process of DPRI projects should be handled moving forward and the necessary resources needed to support any surge in construction associated with posture-related initiatives in both Iwakuni and Okinawa. |
In an April 2016 update on the status of our recommendation, the Army Corps of Engineers stated it began completing mission analysis studies every 6 months. It coordinates with the service components to determine where they are in their master planning with the installations to see what they need for facilities, and with U.S. Forces Japan to identify what projects are planned to be referred to the Army Corps of Engineers. Based on that information, the Army Corps of Engineers proactively makes an educated guess for its upcoming workload and budget. The resulting mission analysis document is a huge spreadsheet with algorithms to line out all the projects by fiscal year and quarter. While the Army Corps of Engineers started this process in 2011, officials stated they refined it in 2013 after GAO issued its report. Consistent with our recommendation, the Army Corps of Engineers' mission analysis studies will help DOD identify the resources it needs to assist with the development and oversight of the DPRI projects that may involve a surge in concurrent construction.
|
| Department of Defense | To aid DOD and Congress in obtaining sufficient information to make prudent investment decisions for the sustainment of U.S. forces on Okinawa and Guam while implementing the planned movements associated with the realignment of Marines and the consolidation efforts on Okinawa, the Secretary of Defense should direct the appropriate service officials to update Okinawa installation master plans to include sustainment requirements and the costs to sustain the U.S. presence on Okinawa until the Marine realignment and Okinawa consolidation efforts are completed. At a minimum, these plans should identify both short-term needs and long-term needs to account for the uncertainty regarding the time needed to implement the realignment and consolidation initiatives on Okinawa. |
In a follow-on report issued in April 2017 (GAO-17-415), we reported that, in December 2015, the Navy developed a master plan for the Marine Corps infrastructure on Okinawa. However, the Navy did not identify in the master plan short- or long-term needs to account for uncertainty regarding the time needed to complete related realignment activities as we had recommended. Not identifying in the master plan short- or long-term sustainment needs puts DOD at risk of not having the information necessary to make informed decisions about maintaining its infrastructure at an acceptable level to carry out its mission.
|
| Department of Defense | To aid DOD and Congress in obtaining sufficient information to make prudent investment decisions for the sustainment of U.S. forces on Okinawa and Guam while implementing the planned movements associated with the realignment of Marines and the consolidation efforts on Okinawa, the Secretary of Defense should direct appropriate service officials to provide, as they become available, annual master schedule and unit movement updates associated with the realignment initiatives on Okinawa to the appropriate Air Force officials. These updates should include any updated housing requirements such as the demographics of Marine families required to be housed on Okinawa during the future phases of the realignment initiatives on Okinawa, thus allowing the appropriate Air Force officials to perform up-to-date assessments and develop housing investment strategies reflecting the updated schedule and housing requirements. |
Subsequent to our report, DOD began communicating updates to Air Force stakeholders at the component and headquarters levels, including through the Joint Region Marianas command in Guam. Moreover, in May 2016 the Assistance Secretary of the Air Force (Installations, Environment, and Energy) signed a memo citing collaborative discussions with the military services to reach an agreement on the total number of family housing units in Okinawa. Consistent with our recommendation, providing the Air Force additional information on Okinawa housing requirements will better allow the Air Force to sustain its housing inventory in a cost-effective manner.
|
| Department of Defense | To aid DOD and Congress in obtaining sufficient information to make prudent investment decisions for the sustainment of U.S. forces on Okinawa and Guam while implementing the planned movements associated with the realignment of Marines and the consolidation efforts on Okinawa, the Secretary of Defense should direct the Secretary of the Navy to conduct an economic analysis to include assessing the costs of maintaining vacant housing on Guam to arrive at an informed decision weighing the cost of maintaining or renovating this housing versus the construction of new facilities to support the requirements for the Marine Corps realignment to Guam. |
According to officials, the Department of the Navy completed a housing market analysis to establish a baseline for long-term military housing requirements on Guam in 2013. This analysis was incorporated into the construction plan associated with the GMP and later revised with a decision to move family housing from Finegayan to Andersen Air Force Base. This information was codified in the Record of Decision, released on August 28, 2015. This response meets and closes our recommended action.
|