Cost of moving overseas bases elusive

Nearly a year after President Bush announced plans to move some 70,000 troops out of Europe, the Korean peninsula and elsewhere, military officials still are still not sure how much the relocation would cost. Some calculate the potential bottom line at $4 billion to $25 billion over six years.

The uncertainty has prompted the independent Overseas Base Commission to request a meeting with Pentagon officials to arrive at a realistic figure, just as the clock ticks down on the Aug. 15 due date for the commission's final report to Congress.

Without knowing the full cost of the global moves, domestic base-closure decisions might be made in a vacuum. And the military services might be forced to raid their budget plans for the next five years to pay for any shortfalls or unexpected costs.

The Office of the Secretary of Defense "has bit off more than it can reasonably afford" for the overseas and domestic basing changes, a senior Defense Department official said Wednesday. "They made decisions without determining if they could afford to pay for them. Now it is coming back to haunt them."

The military services were told six months ago they could expect to spend $4 billion on overseas personnel moves and military construction costs over the next five years, the official said. The Army was expected to bear the brunt of those costs -- $3.6 billion.

But the Army's figure has grown in the last several weeks and the other services are now devising new cost estimates to relocate their troops.

Within the last year, the estimate the Defense Department gave the commission put the price of the move at $9 billion to $12 billion. Those figures included costs of closing bases, moving people and equipment and setting up new facilities and installations.

The commission countered with its own estimate of $20 billion, which covers one-time and recurring costs of the moves, new facility costs, and any fees related to rebasing in South Korea.

"It is safe to say it's going to be more than either expected," said a commission official. "DoD folks are seeing changes that are going to be more."

Indeed, two senior Defense Department officials recently told the commission the estimate will be closer to $25 billion, Chairman Al Cornella told a Senate Military Construction Subcommittee hearing in late June.

The higher figure appears to be backed up in part by an internal April 29 Army planning document that estimates net costs of moving four heavy brigades and the 1st Infantry Aviation Brigade out of Germany to Fort Bliss, Texas, and Fort Riley, Kansas, at $5.2 billion between 2006 and 2011. That estimate covers the cost of moving and constructing new facilities to accommodate 19,863 troops and civilian personnel, a fraction of the total overseas relocation.

"What are these guys counting?" said Christopher Hellman at the Center for Arms Control and Non-Proliferation. "You have to assume the high [cost estimate], because that's the worst-case scenario. So, why are you budgeting for the low, which is the best-case scenario?"

The commission was created as part of the 2004 Military Construction Appropriations Act.

"What we could end up with, is Congress agreeing with the Defense Department that the moves are worthwhile and in the right vein," the commission official said. "If you commit to this ... [you] force future congresses to pay a bill later for decisions they're making now."

Senate Military Construction Appropriations Subcommittee ranking member Dianne Feinstein, D-Calif., said she has not heard back from the Pentagon on total costs, or how the military plans to cover it.

So far, the Army plans to pay for the overseas rebasing with military construction dollars through 2011, pushing some building projects well into the next decade, the senior defense official said.

But they have only come up with $2.6 billion so far, leaving at least a $2 billion gap to pay for the move. The rest of the money will most likely come from construction accounts, but the service also might be forced to raid development and procurement dollars to cover the costs.

The expense comes on top of a domestic base-realignment and closure price tag that might exceed $24 billion. The services will have to pay around $13 billion of that out of their own budgets.

The department will be "hard-pressed" to fund the changes without "significant reductions to other accounts," the senior defense official said.

The House set aside $1.9 billion for base closures in fiscal 2006, including oversees basing moves, in its Military Quality of Life and Veterans Affairs appropriations bill. The Senate Military Construction subcommittee will mark up its bill next week. Depending on final basing decisions, Congress might have to make adjustments in conference or during the coming fiscal year, said a spokesman for the House Appropriations Committee.