Overseas Contingency Operations: Reported Obligations for the Department of Defense

Since 2001, Congress has provided the Department of Defense (DOD) with $893 billion in supplemental and annual appropriations, as of June 2009, primarily for Overseas Contingency Operations (OCO).1 DOD's reported annual obligations2 for OCO have shown a steady increase from about $0.2 billion in fiscal year 2001 to about $162.4 billion in fiscal year 2008. For fiscal year 2009, Congress appropriated $151 billion in war-related requests. A total of $89.1 billion has been obligated through the third quarter of fiscal year 2009 through June 2009. The United States' commitments to OCO will likely involve the continued investment of significant resources, requiring decision makers to consider difficult trade-offs as the nation faces an increasing long-range fiscal challenge. The magnitude of future costs will depend on several direct and indirect cost variables and, in some cases, decisions that have not yet been made. DOD's future costs will likely be affected by the pace and duration of operations, the types of facilities needed to support troops overseas, redeployment plans, and the amount of equipment to be repaired or replaced. DOD compiles and reports monthly and cumulative incremental obligations incurred to support OCO in a monthly report commonly called the Contingency Operations Status of Funds Report. DOD leadership uses this report, along with other information, to advise Congress on the costs of the war and to formulate future OCO budget requests. DOD reports these obligations by appropriation, contingency operation, and military service or defense agency. DOD has prepared monthly reports on the obligations incurred for its involvement in OCO since fiscal year 2001.

As of June 2009, Congress has appropriated a total of about $893 billion primarily for OCO since 2001. Of that amount, $151 billion was appropriated for use in fiscal year 2009. DOD has reported obligations of about $744 billion for OCO from fiscal year 2001 through fiscal year 2008 and for fiscal year 2009 (October 2008 through June 2009). The $149 billion difference between DOD's appropriations and reported obligations can generally be attributed to the remaining fiscal year 2009 appropriations; multiyear funding for procurement; military construction; and research, development, test, and evaluation from previous OCO-related appropriations that have yet to be obligated; and obligations for classified and other items, which DOD considers to be non-OCO related, that are not reported in DOD's cost-of-war reports. Of DOD's total cumulative reported obligations for OCO through June 2009 (about $744 billion), about $570 billion is for operations in and around Iraq as part of Operation Iraqi Freedom, and about $146 billion is for operations in Afghanistan, the Horn of Africa, the Philippines, and elsewhere as part of Operation Enduring Freedom. The remainder of about $28 billion is for operations in defense of the homeland as part of Operation Noble Eagle. DOD's reported obligations for Operation Iraqi Freedom have consistently increased each fiscal year since operations began. The increases in reported obligations for Operation Iraqi Freedom are in part due to continued costs for military personnel, such as military pay and allowances for mobilized reservists, and for rising operation and maintenance expenses, such as higher contract costs for housing, food, and services and higher fuel costs. In fiscal year 2009, through June 2009, DOD reported obligations of about $89.1 billion, which is more than one half of the total amount of obligation it reported for all of fiscal year 2008. Reported obligations for Operation Iraqi Freedom for the same period continue to account for the largest portion of total reported OCO obligations by operation--about $61.5 billion. In contrast, reported obligations associated with Operation Enduring Freedom total about $27.4 billion, and reported obligations associated with Operation Noble Eagle total about $138.2 million.