CONGRESS OF THE UNITED STATES

CONGRESSIONAL BUDGET OFFICE

CBO

Preserving the 

Navy’s Forward 

Presence With a 

Smaller Fleet

MARCH 2015
CBO

Notes

Unless otherwise indicated, all dollar amounts in this report reflect budget authority in 

2014 dollars, and all years are federal fiscal years (which run from October 1 to September 30 

and are designated by the calendar year in which they end).

Numbers in the text and tables may not add up to totals because of rounding.

On the cover: U.S.S. McCampbell (DDG 85), Yokosuka, Japan, July 2014. U.S. Navy photo 

by Mass Communication Specialist Seaman Amanda S. Kitchner.

www.cbo.gov/publication/49989
Contents

CBO

Summary 1

What Size Fleet Could the Navy Maintain With Smaller Shipbuilding Budgets? 1

How Could the Navy Maintain Its Forward Presence Under Smaller 

Shipbuilding Budgets? 3

The Navy’s 2015 Shipbuilding Plan 4

Shipbuilding Under Smaller Budgets 4

What Would Smaller Shipbuilding Budgets Buy? 6

What Would Be the Policy Implications of Smaller Budgets? 7

What Would Be the Implications for the Shipbuilding Industry? 8

Maintaining a Forward Presence With a Smaller Fleet 8

Increasing the Length and Frequency of Deployments 10

Basing More Ships Overseas 12

Rotating Crews 14

Analysis of Approaches to Maintaining a Forward Presence 16

Forward Presence Under an Annual Shipbuilding Budget of $16 Billion 17

Forward Presence Under an Annual Shipbuilding Budget of $14 Billion 17

Forward Presence Under an Annual Shipbuilding Budget of $12 Billion 20

Cost Implications 21

Appendix: Comparison of Different-Sized Fleets Under Two Approaches to 

Maintaining Forward Presence 25

List of Tables and Figures 28

About This Document 29

CBO

Preserving the Navy’s Forward Presence 

With a Smaller Fleet

Summary

In support of its mission to deter conflict or fight in wars 

if necessary, the Navy considers it a core responsibility to 

maintain a forward presence—to keep some of its fleet far 

from U.S. shores at all times in areas that are important 

to national interests. Toward that end, at any given time, 

about one-third of the fleet is deployed overseas. The rest 

of the Navy’s ships are in or near their home ports in the 

United States for maintenance, training, or sustainment 

(a period in which a ship is in port but ready to deploy 

quickly). Most of the ships that contribute to the Navy’s 

current forward presence of about 100 ships sail from 

ports in the United States; 31 others are now stationed 

permanently in foreign countries or at overseas U.S. military bases. In the future, the Navy expects to boost the 

proportion of ships that it bases abroad. 

The Congressional Budget Office estimates that, for the 

next 30 years, the Navy’s 2015 shipbuilding plan (which 

aims to increase the fleet from 281 ships in 2014 to 

306 ships by 2022) would cost about $21 billion annually, on average, in constant 2014 dollars.1

 The Navy’s 

estimates set the figure somewhat lower—at about 

$19 billion per year.2

 Both estimates are greater than the 

annual average of almost $16 billion that the Navy has 

spent for the past three decades, which suggests that the 

Navy may have difficulty affording its plans. The Chief 

of Naval Operations’ emphasis on forward operations 

indicates that the Navy has committed to maintaining 

the largest possible forward presence under any given 

budget plan.3

What Size Fleet Could the Navy Maintain With 

Smaller Shipbuilding Budgets?

CBO assessed the effects of three smaller annual shipbuilding budgets—$16 billion, $14 billion, and 

$12 billion—for the next 30 years. In all three cases, by 

2044, the fleet would be smaller than would be the case 

under the Navy’s current plan:

 Under the $16 billion budget, by 2044, the fleet 

would consist of 251 ships, 17 percent fewer than 

under the Navy’s current plan; 

 Under the $14 billion budget, it would be 230 ships, 

24 percent fewer than under the current plan; and

 Under the $12 billion budget, it would be 208 ships, 

31 percent fewer than under the current plan (see 

Table 1). 

Those estimates reflect an assumption that the Navy 

would reduce the number of its major warships—aircraft 

carriers, surface combatants, submarines, and amphibious 

warfare ships—in rough proportion to their current share 

of the fleet. 

1. See Congressional Budget Office, An Analysis of the Navy’s Fiscal 

Year 2015 Shipbuilding Plan (December 2014), www.cbo.gov/

publication/49818. All dollar amounts presented in this report are 

in 2014 dollars.

2. See Department of the Navy, Report to Congress on the Annual 

Long-Range Plan for Construction of Naval Vessels for FY2015

(July 2014), http://go.usa.gov/FYZR (PDF, 3.4 MB).

3. See Department of the Navy, Chief of Naval Operations, CNO’s 

Sailing Directions (accessed March 12, 2015), http://go.usa.gov/

feez (PDF, 163 KB).
2 PRESERVING THE NAVY’S FORWARD PRESENCE WITH A SMALLER FLEET MARCH 2015

CBO

Table 1.

Fleet Characteristics and Costs of Maintaining the Navy’s Forward Presence Under 

Various Shipbuilding Budgets, 2044

Source: Congressional Budget Office.

Note: All costs are in billions of 2014 dollars.

a. Figures are for operation and support savings before adjustment using either Approach 1 or Approach 2.

b. The U.S.-based aircraft carriers and large surface combatants would conduct two 6- or 7-month deployments over the 36-month 

operating cycle.

c. Some attack submarines would conduct 7-month deployments and some would conduct 6-month deployments. 

Fleet Inventory, 2044 251 230 208

Reduction in Ships From Navy Plan (Percent) 17 24 31

Annual Cost Savings, Operation and Support

(Billions of 2014 dollars)a 6 10 13

Ships Providing Forward Presence 

At Any Given Time 113 111 108

Type of Ship

Aircraft carrier

Large surface combatant

Attack submarine

Amphibious warfare ship

Cost (Billions of 2014 dollars)

Annual recurring

Onetime

Key Challenges to Implementation

- Retention of Sailors Because of Long Deployments

- Endurance of Crews in Future Crises

- Ship Maintenance

Ships Providing Forward Presence 

At Any Given Time 113 112 110

Type of Ship

Aircraft carrier 1, 0 1, 0 2, 0

Large surface combatant 4, 0 4, 6 5, 10

Attack submarine 7, 6 7, 8 9, 10

Amphibious warfare ship 2, 0 2, 2 2, 2

Cost (Billions of 2014 dollars)

Annual recurring

Onetime

Key Challenges to Implementation

- Building Overseas Capacity

- Adapting to New Rotation Procedures

- Keeping the Fleet Secure

10/36

10/36

8/27

6 and 6/36b

6 and 6/36b

9/27

7 and 7/36b

7 and 7/36b

9/27

Less than 1 Less than 5

Less than 5

3 to 10 3 to 10 16 to 25

Additional Ships Based Overseas, Additional Ships With Rotating Crews

Less than 10

Less than 0.5

Approach 2: Base More Ships Overseas and Use More Rotating Crews

Less than 1

000

7/24c 7/24c 7/24c

$16 Billion $14 Billion $12 Billion 

Average Annual Shipbuilding Budget

Approach 1: Increase the Length of Deployments for U.S.-Based Ships

Deployment Length/Operating Cycle (Months)
MARCH 2015 PRESERVING THE NAVY’S FORWARD PRESENCE WITH A SMALLER FLEET 3

CBO

How Could the Navy Maintain Its Forward Presence 

Under Smaller Shipbuilding Budgets? 

The Navy could maximize its forward presence with 

smaller budgets by expanding the use of three methods 

that it currently applies to boost overseas operations:

 Deploying ships for longer periods, 

 Basing more ships and their crews overseas, and 

 Assigning more than one crew to some ships to permit 

longer deployments. 

Even under smaller budgets, CBO found, the Navy could 

expand its use of each method to maintain the current 

forward presence, although all three involve costs and 

pose disadvantages. And even though the Navy might be 

able to maintain its forward presence by making more use 

of those methods, smaller fleets would nonetheless reduce 

the service’s ability to implement its war plans in the 

event of conflict and would limit its flexibility in a crisis 

short of war. 

The Navy also could use different mixes of those methods 

to maintain its forward presence. To illustrate a range of 

possibilities, CBO analyzed two basic approaches: The 

first would simply lengthen many ships’ deployments; the 

second would combine the other two methods into a single approach to increase the efficiency of the ships’ use. 

Approach 1: Deploy Ships for Longer Periods. Under this 

approach, the Navy’s ships would undertake more frequent and longer deployments. For example, with an 

annual shipbuilding budget of $16 billion, most large 

surface combatants (cruisers and destroyers) and aircraft 

carriers would be deployed for 10 months out of a 

36-month operating cycle (or 28 percent of the time—

the other 26 months would be devoted to maintenance, 

training, and sustainment); under a $14 billion budget, 

those ships would be deployed twice in a 36-month cycle, 

for 6 months each time (or 33 percent of the time); and 

under a $12 billion annual budget, the ships would be 

deployed twice in a 36-month cycle, but for 7 months 

each time (or 39 percent of the time). By comparison, 

in 2013, the Navy’s destroyers were deployed, on average, 

for a little longer than 7 months out of a 27-month 

operating cycle, or about 26 percent of the time. 

Longer deployments are more expensive than shorter 

deployments but, under the scenarios considered in this 

report, longer deployments are less expensive than buying 

larger fleets. Costs increase for longer deployments 

because sailors are paid more while they are at sea, ships 

consume more fuel, and equipment must be replaced 

sooner because it wears out faster. But the additional 

operating costs of longer deployments would be considerably less than the savings that would result from the lower 

procurement costs and smaller operating budgets 

required to maintain smaller fleets. As a result, by CBO’s 

estimate, this approach would save between $11 billion 

and $17 billion per year, depending on the size of the 

fleet.

Several disadvantages, sometimes with accumulating 

effects, can arise from longer periods at sea. For example, 

if the ships must be deployed quickly because of a crisis or 

a war, crew members who have already been at sea for an 

extended time could be tired. Longer deployments subject sailors and families alike to added stress, which might 

hamper the Navy’s retention of crew members. Higher 

sea pay or larger retention bonuses might or might not 

mitigate that problem. If ships are away from home ports 

more often or for longer periods, maintenance schedules 

could be disrupted or altered; if that resulted in less effective or less timely maintenance, ships might not be able 

to remain in the fleet until the end of their expected service lives. Planning for longer deployments and increasing maintenance may mitigate that problem.

Approach 2: Base More Ships Overseas and Rotate 

Crews on More Ships. The second approach CBO 

examined would require the Navy to base another 14 to 

18 ships—including aircraft carriers—overseas and 

to increase by between 12 and 22 (depending on the 

shipbuilding budget) the number of ships that used 

rotating crews. Basing more ships overseas can avert some 

challenges of longer deployments—crews are not as tired 

and are able to spend more time at home—and ships are 

more likely to be close to crisis spots. But this approach 

would save less than the first, mainly because of higher 

expenses for maintenance and personnel as a result of 

operating the ships more and using more crews. The 

increased spending could offset a substantial portion 

of the savings from smaller procurement and operating 

budgets, particularly at the lowest of the three budget 

amounts, but this approach could still save between 

$10 billion and $12 billion each year, depending on the 

size of the fleet. 
4 PRESERVING THE NAVY’S FORWARD PRESENCE WITH A SMALLER FLEET MARCH 2015

CBO

Rotating crews pose several disadvantages, however. Their 

use on attack submarines, destroyers, and amphibious 

warfare ships could raise logistical and cultural challenges. 

In particular, the Navy would need to keep the crews that 

are not deployed trained and ready to go to sea when 

their turn arose to operate the ships. Crews might identify less with a particular ship—possibly resulting in 

lower-quality work or diminished attention to maintaining equipment in the best possible condition. The Navy 

has overcome such challenges in the past, notably in its 

staffing of ballistic missile submarines with a pair of crews 

alternating on fixed-period deployments. The Navy also 

uses rotating crews on its new littoral combat ships, but 

widespread application of dual and multiple crewing to 

other parts of the fleet would present a greater challenge.

Expanding the Navy’s forward presence by basing more 

ships abroad might reassure allies or deter potential 

adversaries, but it also could increase the fleet’s vulnerability to attack. For example, a larger concentration of 

naval forces based overseas would make the fleet more 

vulnerable to a surprise attack by another nation, by terrorists, or by other nonstate actors. And overseas bases 

can be closed off relatively quickly if a host government 

decides it no longer wants U.S. Navy ships based in its 

harbors. Finally, some challenges could be economic: 

With more ships based overseas, some areas in the United 

States near naval bases would see reduced economic activity (while the host countries might see more). 

The Navy’s 2015 Shipbuilding Plan

In its most recent shipbuilding plan, the Navy proposes 

to purchase 264 ships over the period from 2015 to 

2044: 6 aircraft carriers, 12 ballistic missile submarines, 

48 attack submarines, 65 destroyers, 66 littoral combat 

ships, 21 amphibious warfare ships, and 46 combat logistics and support ships (see Table 2). Taking into account 

the projected retirements of ships now in the fleet, those 

purchases would allow the Navy to maintain a fleet of 

306 ships or more beginning in 2022 and for most years 

thereafter through the end of the period.4 CBO estimates 

that the Navy’s current plan would cost $21 billion per 

year, on average, for the next 30 years.5

Such a large shipbuilding budget over a span of three 

decades has no historical precedent. In constant 2014 

dollars, average annual spending over the past decade has 

been about $14 billion; the annual average for the past 

30 years has been roughly $16 billion. Those figures 

suggest, and the Navy’s report explicitly states, that the 

Navy will find it difficult at best to fully implement its 

current shipbuilding plan, particularly if the budget for 

the Department of Defense continues to be subject to 

significant constraints. 

Shipbuilding Under Smaller Budgets

CBO analyzed possible changes in the composition of the 

Navy’s fleet that would be required under various shipbuilding budgets. For this analysis, CBO chose three 

basic annual amounts, all in 2014 dollars and each resulting in a smaller fleet than the Navy currently envisions:

 $16 billion (the average ship construction budget over 

the past 30 years),

 $14 billion (the average ship construction budget for 

the past 10 years), and

 $12 billion (the average ship construction budget 

during the 1990s).

CBO’s analysis incorporates the assumption that reductions in shipbuilding relative to the Navy’s 2015 plan 

would be distributed in rough proportion to current 

numbers of major battle force ships: aircraft carriers, large 

and small surface combatants, submarines, and amphibious warfare ships. The number of combat logistics and 

support ships also would be reduced, although by smaller

4. For more information, see Congressional Budget Office, 

An Analysis of the Navy’s Fiscal Year 2015 Shipbuilding Plan

(December 2014), www.cbo.gov/publication/49818, and 

An Analysis of the Navy’s Fiscal Year 2014 Shipbuilding Plan 

(October 2013), www.cbo.gov/publication/44655. The 2014 and 

2015 shipbuilding plans are similar, although the Navy changed 

the way it counts battle force ships for the 2015 plan. The changes 

affect a small number of ship classes designated as very small 

combatants or logistics and support ships. This report relies on the 

counting rules used for 2014 and earlier plans. CBO discusses 

the new rules on page 8 of its report on the 2015 plan. In the 

2015 National Defense Authorization Act, the Congress directs 

the Navy to generally rely on the prior counting rules in 

formulating its future shipbuilding plans.

5. That amount covers everything that the Navy pays for from its 

shipbuilding accounts, including construction of new ships, 

refueling of nuclear-powered aircraft carriers, ship conversions, 

construction of training ships, outfitting and postdelivery costs 

(which include the purchase of many smaller tools and pieces of 

equipment needed to operate a ship but not necessarily provided 

by the manufacturing shipyard), and other smaller items. 
MARCH 2015 PRESERVING THE NAVY’S FORWARD PRESENCE WITH A SMALLER FLEET 5

CBO

Table 2.

CBO’s Projections of Purchases and Costs of New Battle Force Ships Under Alternative 

Shipbuilding Budgets, 2015–2044

Source: Congressional Budget Office.

Note: CBO’s analysis includes the assumption that, under all three budget plans, the Navy would buy ships of each type in roughly the same 

proportion as it would under its 2015 plan.

a. CBO estimates that the Navy’s fiscal year 2015 shipbuilding plan would require an average budget of $21 billion per year over the 

2015–2044 period. See Congressional Budget Office, An Analysis of the Navy’s 2015 Shipbuilding Plan (www.cbo.gov/publication/

49818). The Navy estimates that its 2015 shipbuilding plan would cost an average of $19 billion per year. That amount covers everything 

that the Navy pays for from its shipbuilding accounts, including construction of new ships, refueling of nuclear-powered aircraft carriers, 

ship conversions, construction of training ships, outfitting and postdelivery costs (which include the purchase of many smaller tools and 

pieces of equipment needed to operate a ship but not necessarily provided by the manufacturing shipyard), and other smaller items. 

b. Other items include funding for refueling nuclear-powered aircraft carriers and the costs of various items that the Navy purchases from its 

shipbuilding account.

Combat Ships

Aircraft carriers 6 5 4 3

Ballistic missile submarines 12 10 8 6

Attack submarines 48 31 29 27

Destroyers 65 48 41 31

Littoral combat ships 66 47 44 39

Amphibious warfare ships 21 15 12 10 ___ ___ ___ ___

Subtotal 218 156 138 116

Combat Logistics and

Support Ships 46 41 37 33 ____ ____ ____ ____

Total 264 197 175 149

Combat Ships

Aircraft carriers 76 63 57 43

Ballistic missile submarines 92 83 69 54

Attack submarines 144 95 89 84

Destroyers 144 109 91 75

Littoral combat ships 35 25 24 21

Amphibious warfare ships 53 37 31 25 ___ ___ ___ ___

Subtotal 544 412 361 302

Combat Logistics and

Support Ships 23 22 20 18

Other Itemsb 55 49 41 39 ____ ____ ____ ____

Total 621 483 422 359

Number of Ships Purchased

($21 Billion) $16 Billion $14 Billion $12 Billion a

Navy's 2015 Plan Average Annual Shipbuilding Budget

Cost (Billions of 2014 dollars)
6 PRESERVING THE NAVY’S FORWARD PRESENCE WITH A SMALLER FLEET MARCH 2015

CBO

Table 3.

Inventory of Battle Force Ships and Fleet Composition in Selected Years Under 

Alternative Shipbuilding Budgets 

Source: Congressional Budget Office. [† On March 17, 2015, CBO corrected this number to increase it by 1.]

a. Small surface combatants and mine countermeasures ships include littoral combat ships, Oliver Hazard Perry class FFG-7 frigates, and 

Avenger class mine countermeasures ships.

percentages. Many of those ships (except oilers) are small 

and comparatively inexpensive, and their number is not 

tied directly to the size of the overall fleet. Thus, CBO 

did not reduce the number of support ships by the same 

proportion that it reduced the number of combat ships 

for each budget amount.

What Would Smaller Shipbuilding Budgets Buy?

With an average annual budget of $16 billion, the largest 

of the three amounts considered for this report, CBO 

estimates that the Navy would purchase 197 battle force 

ships over the next 30 years—67 fewer than the Navy’s 

2015 plan calls for. Nearly all of the difference in inventories would come in the second and third decades. 

Under a $16 billion plan, the fleet would decline gradually from its current 281 battle force ships to 251 ships by 

2044—17 percent fewer than the 303 ships envisioned 

for that year in the Navy’s 2015 plan (see the top panel of 

Table 3 and Figure 1). 

In CBO’s analysis, the composition of the fleet (that is, 

the percentage share for each type of vessel) in 2044 

under the $16 billion budget would closely resemble the 

composition proposed in the Navy’s 2015 plan (see the

2014 2024 2034 2044 2014 2024 2034 2044 2014 2024 2034 2044 2014 2024 2034 2044

Combat Ships

Aircraft carriers 10 12 11 10 10 11 11 9 10 11 11 8 10 11 10 7

Ballistic missile submarines 14 14 10 12 14 14 8 † 10 14 14 8 8 14 14 7 6

Attack submarines 54 48 46 52 54 48 39 39 54 48 37 37 54 47 36 35

Guided missile submarines 4 4 0 0 4 4 0 0 4 4 0 0 4 4 0 0

Large surface combatants 85 98 86 83 85 90 72 70 85 89 69 64 85 87 59 55

Small surface combatants and

mine countermeasures shipsa 26 41 52 52 26 35 43 37 26 35 42 32 26 35 39 27

Amphibious warfare ships 31 34 34 31 31 33 31 27 31 33 29 26 31 33 29 25 ___ ___ ___ ___ ___ ___ ___ ___ ___ ___ ___ ___ ___ ___ ___ ___

Subtotal 224 251 239 240 224 235 204 † 192 224 234 196 175 224 231 180 155

Combat Logistics and Support Ships 57 62 64 63 57 64 62 59 57 64 62 55 57 64 59 53 ___ ___ ___ ___ ___ ___ ___ ___ ___ ___ ___ ___ ___ ___ ___ ___

Total 281 313 303 303 281 299 266 † 251 281 298 258 230 281 295 239 208

Combat Ships

Aircraft carriers 4 4 4 3 4 4 4 4 4 4 4 3 4 4 4 3

Ballistic missile submarines 5 5 3 4 5 5 3 4 5 5 3 3 5 5 3 3

Attack submarines 19 16 16 17 19 16 15 16 19 16 14 16 19 16 15 17

Guided missile submarines 1 1 0 0 1 1 0 0 1 1 0 0 1 1 0 0

Large surface combatants 30 29 26 27 30 30 27 28 30 30 27 28 30 29 25 26

Small surface combatants and

mine countermeasures shipsa 9 13 18 17 9 12 16 15 9 12 16 14 9 12 16 13

Amphibious warfare ships 11 11 11 10 11 11 12 11 11 11 11 11 11 11 12 12 __ __ __ __ __ __ __ __ __ __ __ __ __ __ __ __

Subtotal 80 79 78 79 80 79 77 76 80 79 76 76 80 78 75 75

Combat Logistics and Support Ships 20 21 22 21 20 21 23 24 20 21 24 24 20 22 25 25 ___ ___ ___ ___ ___ ___ ___ ___ ___ ___ ___ ___ ___ ___ ___ ___

Total 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100

$16 Billion Budget $14 Billion Budget $12 Billion Budget

Inventory of Battle Force Ships

Composition of Battle Force Fleet (Percent)

Navy's 2015 Plan
MARCH 2015 PRESERVING THE NAVY’S FORWARD PRESENCE WITH A SMALLER FLEET 7

CBO

Figure 1.

Inventories of Selected Ship Types Under 

Various Annual Shipbuilding Budgets, 2044

Source: Congressional Budget Office.

bottom panel of Table 3). (CBO assumes that the various 

ship programs would be cut roughly, but not precisely, by 

equal proportions.) The largest difference for combat 

ships would be in the numbers of small surface combatants and mine countermeasures ships, which would 

account for a share of the fleet that is 2 percentage points 

smaller than under the Navy’s plan. A $16 billion budget 

would result in a 3 percentage-point increase in the share 

of combat logistics and support ships. (In CBO’s analysis, 

the percentage of support ships generally increases 

slightly under all three alternative budgets.)

If the Navy was allocated a $14 billion annual budget for 

shipbuilding, CBO projects, it could purchase 175 battle 

force ships, 34 percent fewer than would be purchased 

under the Navy’s 2015 plan. As would be the case for the 

$16 billion annual budget, in the first decade for this 

plan, the fleet’s composition would be largely similar to 

that under the Navy’s 2015 plan. By 2044, however, the 

fleet would number 230 ships—24 percent fewer than 

the number envisioned for that year in the Navy’s 2015 

plan. Under CBO’s assumptions, its composition would 

be virtually the same as that under the $16 billion 

budget. 

With an average annual budget of $12 billion, CBO 

projects, the Navy could purchase 149 battle force ships, 

44 percent fewer than under the Navy’s 2015 plan. That 

fleet would be slightly smaller in the first decade than 

under the other two scenarios, and by 2044, the inventory would number 208 ships, 31 percent fewer than 

under the Navy’s 2015 plan. 

What Would Be the Policy Implications of 

Smaller Budgets?

Although they would bring the Navy’s shipbuilding plan 

into closer alignment with historical funding, smaller 

fleets would pose risks that cannot be addressed by maintaining the Navy’s forward presence. The Navy would 

probably have insufficient forces to implement its current 

wartime plans (which are described only in classified documents). In particular, under each budget amount, the 

Navy would have fewer ships of all types available to 

reinforce its fleet in combat for the duration of a conflict. 

Similarly, smaller fleets would be placed under greater 

stress in a long crisis that was not a war: If the international environment required the presence of a larger 

naval force beyond the normal forward presence force for 

a long time, smaller fleets would struggle more to provide 

that presence without overtaxing the ships’ crews.

CBO’s analysis did not include an assumption that the 

fleets that would be affordable under smaller budgets 

would forgo certain missions or perform them differently—although those are probable outcomes of smaller 

0

5

10

15

Navy's 2015 Plan

$16 Billion Budget

$14 Billion Budget

$12 Billion Budget

0

20

40

60

Aircraft Carriers

Attack Submarines

0

20

40

60

80

100 Large Surface Combatants

0

20

40

60

Small Surface Combatants

0

10

20

30

40 Amphibious Warfare Ships

2014 Inventory
8 PRESERVING THE NAVY’S FORWARD PRESENCE WITH A SMALLER FLEET MARCH 2015

CBO

shipbuilding budgets. Under such budgetary constraints, 

the Navy could make choices that are entirely different 

from the proportionate reductions CBO assumed, doing 

less overall or emphasizing some types of ships over others 

to better match its forces to changing demands or wartime priorities. If the Navy was substantially smaller, 

policymakers in the United States might decide to place 

more or less emphasis on certain regions, perhaps changing the fleet’s composition as a result. A smaller fleet also 

might cause military leaders to adopt strategies or tactics 

for achieving objectives different from those that they 

might pursue with a larger fleet; such differences also 

could affect the fleet’s composition. Thus, for example, it 

might be argued that if the United States can afford only 

a small Navy, the fleet should have more submarines relative to aircraft carriers or surface ships because submarines are difficult to detect and can effectively impede 

another navy’s control of the seas. 

Some observers have recommended that the Navy 

increase its reliance on a larger number of smaller ships 

that are closely networked electronically. In that case, the 

Navy might purchase ships and have fleets that are markedly different from those considered in this analysis. 

What Would Be the Implications for the 

Shipbuilding Industry?

Although CBO did not specifically analyze the potential 

effects on naval shipyards, shipbuilding clearly would be 

curtailed under smaller budgets. Hundreds of companies 

contribute to the shipbuilding effort at the five large shipyards that produce the Navy’s aircraft carriers, large surface combatants, submarines, amphibious warfare ships, 

and support ships and at the two smaller yards that produce littoral combat ships and small support ships. Those 

seven shipyards build few ships for the private sector. If 

funding was increased from its recent levels as envisioned 

under the Navy’s plan, the shipyards’ infrastructure could 

accommodate the resulting increase in orders, and the 

number of workers would need to increase. In contrast, 

if spending was less than that in recent years, fewer jobs 

would be available in the shipyards and related 

businesses.

There is a tension in determining the most efficient 

industrial base for shipbuilding. On the one hand, when 

a given shipyard produces more ships, per-ship overhead 

costs should decline and workers’ skills should increase 

with each additional unit. On the other hand, if, under 

smaller shipbuilding budgets, orders were consolidated at 

fewer yards to preserve efficiency and, as a result, some 

shipyards closed, there would be less opportunity for 

competition to reduce the costs. 

Over the past decade, the Navy has spent about $14 billion annually to build, on average, 7.7 ships per year. 

During that time, one major shipyard closed so that its 

parent company could consolidate its shipbuilding business at another yard to improve efficiency. Under each of 

the three budget scenarios, rising average costs per ship 

would reduce average annual ship purchases to 6.5 ships 

under the $16 billion budget, 5.8 ships under the 

$14 billion budget, and 5.0 ships under the $12 billion 

budget—or fewer than one ship per yard per year if all 

seven yards continued to receive orders from the Navy.

CBO’s analysis incorporates the assumption that yards 

would be closed as needed to produce ships efficiently. 

Under the $16 billion budget, by the mid-2020s one or 

two large shipyards and one small shipyard would stop 

receiving Navy orders. Under the $12 billion budget, two 

or three large shipyards and one small shipyard probably 

would stop receiving orders from the Navy. One yard 

would produce all of the Navy’s destroyers if just one was 

purchased each year for a long period, as would be the 

case under the $12 billion budget. 

CBO’s cost analyses incorporate those changes to the 

extent that the closing of one or more shipyards would 

affect production rates (and purchase prices) at another 

shipyard. If the Navy continued to enlist all existing yards 

in the naval shipbuilding business, costs for each ship 

would be higher than CBO estimates and the Navy 

would be able to purchase fewer ships under each budget 

amount unless savings from competition equaled or 

exceeded the savings from having some yards produce a 

larger number of ships.

Maintaining a Forward Presence 

With a Smaller Fleet

The Navy routinely deploys slightly more than one-third 

of its total fleet overseas. In Congressional testimony, 

Navy officials stated that the service has about 100 ships
MARCH 2015 PRESERVING THE NAVY’S FORWARD PRESENCE WITH A SMALLER FLEET 9

CBO

Figure 2.

Current and Notional Operating Cycles for a Nuclear-Powered Aircraft Carrier

Source: Congressional Budget Office based on data from the Navy.

Note: A ship is considered to be in sustainment if it is able to put to sea and go on deployment within a short period. Under the Enhanced 

Carrier Presence Plan, when a ship is in its dwell phase between deployments, it mostly remains in its home port to allow its crew 

members to rest and spend time with their families.

a. The aircraft carrier in this example is currently based in Japan. It is the Navy’s only overseas-based aircraft carrier, and it is considered to 

be deployed and available to perform missions when it is not in maintenance, even if it is in its home port. 

deployed and operating overseas.6 Until recently, ships 

generally deployed with a single crew for 6 or 7 months 

in a 24- to 32-month operating cycle. (Ships’ assignments 

at sea are limited to the period that the Navy allows a 

crew to be deployed and away from home––called personnel tempo, or PERSTEMPO.) Cycles consist of 

phases for maintenance, training in two phases, and 

deployment, along with a sustainment period during 

which a ship may be at its home port but available to 

deploy quickly. The length of the cycle, which has varied 

over time, depends on the type of ship. Until recently, 

aircraft carriers followed a 32-month operating cycle, up 

from 27 months about a decade ago. Surface combatants 

and amphibious warfare ships followed a 27-month cycle. 

Attack submarines continue to follow a 24-month cycle. 

Late last year, the Navy began to phase in its Optimized 

Fleet Response Plan, which eventually will have all major 

surface ships deploy for up to 8 months in a 36-month 

cycle. (Various operating cycles for aircraft carriers are 

illustrated in Figure 2.)

Maint. Deployment

17 Weeks 35 Weeks

Total Cycle: 52 Weeks (12 months)

Forward Deployed Naval Force (Japan-Based Carrier)a

Maintenance Training Deployment Sustainment

26 Weeks 30 Weeks 35 Weeks 65 Weeks

Total Cycle: 156 Weeks (36 months)

Optmized Fleet Response Plan (2015 and Beyond)

Maintenance Training Deployment Dwell

35 Weeks 30 Weeks 26–30 Weeks 31–39 Weeks

Deployment

26–30 Weeks

Total Cycle: 156 Weeks (36 months)

Enhanced Carrier Presence Plan (CBO Alternative Based on Earlier Navy Proposal)

Maintenance Training Deployment Sustainment

32 Weeks 47 Weeks 30–43 Weeks 17–30 Weeks

Total Cycle: 139 Weeks (32 months)

Fleet Response Plan (2013)

6. Testimony of Jonathan Greenert, Chief of Naval Operations, 

U.S. Navy, before the Subcommittee on Defense of the Senate 

Committee on Appropriations, FY 2016 Department of the Navy 

Posture (March 4, 2015), http://go.usa.gov/3awCY. 
10 PRESERVING THE NAVY’S FORWARD PRESENCE WITH A SMALLER FLEET MARCH 2015

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Table 4.

Major Deployments of U.S.-Based Combat Ships, 2007–2013

Source: Congressional Budget Office based on data from the Department of the Navy.

Note: Excludes ships that operate from overseas bases, such as Japan or Guam, as well as ballistic missile submarines, guided missile 

submarines, and mine countermeasures ships.

a. Small surface combatants are Oliver Hazard Perry class FFG-7 frigates.

Single-crewed ships based in the continental United 

States provide the bulk of the Navy’s deployments, but 

the Navy has used three techniques during the past several decades to sustain or increase its forward presence: 

 Deploying ships for longer periods,

 Basing more ships and their crews overseas, and 

 Assigning more than one crew to some ships that 

operate from an overseas port or from a port in the 

continental United States. 

Crew members’ families typically live where a ship is 

based—at the ship’s official home port. If a ship operates 

from and receives maintenance at an overseas port but has 

a U.S. home port, families reside in the United States. 

Increasing the Length and Frequency of 

Deployments

The Navy can increase its forward presence most quickly 

by boosting the frequency or the duration of ships’ 

deployments, as it has in the recent past. Under normal 

peacetime operations in the 1990s, ships were deployed 

for 6 months about every two years. However, between 

2007 and 2013 (the period for which CBO has data), 

nearly half of all deployments of the Navy’s aircraft 

carriers, large surface combatants, and amphibious warfare ships lasted at least 7 months (see Table 4). Furthermore, a substantial number of surface ships are now 

deployed every year, rather than once in a cycle of 24 to 

32 months, although some of those deployments are for 

periods of only 2 or 3 months each. 

The principal advantage of instituting more frequent or 

longer deployments is that such a change is relatively 

quickly and easily accomplished. Ships need not carry 

additional supplies, for example, because they generally 

are resupplied at sea or in overseas ports. If it is known in 

advance that a deployment will be longer than normal, 

the Navy could plan for additional maintenance; ordinarily, little other additional preparation is necessary.

The disadvantages include the stress borne by crew members and their families and the potential for accelerated 

deterioration of the ships, especially if longer deployments become routine. If deployments commonly last 

longer than six months, recruitment and reenlistment—

particularly among sailors with specialized or difficult-toreplace skills—could suffer. For that reason, the Navy has 

tried to keep most deployments of attack submarines to 

six months. Submariners constitute a relatively small proportion of the total sailing force, but they are among the 

most highly skilled—they are trained to operate and 

Total Number of Deployments 30 125 236 112 87

Number of Deployments by Length

6 months or longer 23 113 198 81 62

7 months or longer 16 15 111 14 46

8 months or longer 4 2 26 2 10

Average Length of Deployment (Days) 191 179 190 172 181

Deployments of the Same Ship in 

Consecutive Years 15 21 76 57 41

Average Number of Ships in the

Navy's Inventory 10 51 71 30 28

Aircraft Attack Large Surface Small Surface Amphibious 

Carriers Submarines Combatants Combatantsa Warfare Ships
MARCH 2015 PRESERVING THE NAVY’S FORWARD PRESENCE WITH A SMALLER FLEET 11

CBO

maintain nuclear-powered ships—and the Navy makes 

extra efforts to retain them.

Despite those concerns, the extent to which more frequent and longer deployments affect reenlistment has not 

been studied extensively. A recent analysis of data from 

2008 to 2013 for 11 Navy ships—6 deployed for six 

months each and 5 deployed for longer periods—showed 

no substantial difference in retention among sailors in 

either group.7

Overall retention data do not provide a clearer picture. 

Retention for the attack submarine force, for example, is 

higher than the Navy average, but submarines generally 

are not deployed for more than six months at a time. 

Conversely, although half of all large surface combatant 

deployments from 2007 to 2013 were at least seven 

months long, retention among sailors on those ships was 

above the Navy’s average and nearly the same as that 

among the submarine crews. Deployments of the aircraft 

carrier force were as long as those for the surface combatant force, yet retention among those sailors was below 

average in every year for the period. And the amphibious 

force, which consistently has the longest deployments, 

had below-average retention for three of the six years but 

above-average retention for the other three years. 

Surveys of sailors indicate anecdotally that their primary 

concern for reenlistment is not the length of deployment 

as such, but the lack of predictability. In the past, most 

deployments of longer than 7 months were unscheduled, 

and sailors learned of them only after they were at sea.8

To address that difficulty, early in 2014 the Navy 

unveiled its Optimized Fleet Response Plan, which would 

change the operating cycle for all surface warships. By 

having one deployment of up to 8 months out of a 

36-month cycle, the new cycle—which the Navy has 

recently implemented for aircraft carriers and surface 

combatants—will provide more predictability and stability in crew deployments. Previous cycles had carriers and 

surface ships deployed for 6 to 7 months out of 32, but 

over the past two years, ships increasingly have been 

deployed for longer periods.9

 If the Navy adheres to the 

new cycle and the schedule it implies, sailors will be 

deployed for less time, on average, than they have been in 

recent years, when many have been at sea for longer 

than 7 months at a time. The disadvantage is that, at 

8 months, deployments typically will be scheduled for a 

month longer than they have been in the past. The Navy’s 

Fleet Forces Command considers that the new operating 

cycle defines the limit on the demands that can be placed 

on ships’ crews without undermining the service’s ability 

to retain experienced sailors. Deployments of 8 months 

out of 36 provide almost the same forward presence as 

that provided by deployments of 7 months out of 32. 

Although it is commonly assumed that ships that are 

deployed routinely for longer periods will require more 

maintenance, there is not much evidence either to support or to refute that belief. According to a study published by the CNA Corporation, failure to perform 

adequate maintenance would shorten the service life of 

surface ships.10 However, that conclusion does not mean 

that lengthier deployments will require maintenance in 

excess of what otherwise would be scheduled. One 

assumption that is incorporated into CBO’s analysis is 

that there is a direct relationship between the amount of 

time spent on deployment and the costs of maintenance. 

For example, amphibious warfare ships currently spend 

about one day in maintenance for every three days’ 

deployment. Under the alternative approaches discussed 

in the final section of this report, CBO estimates the costs 7. Department of the Navy, information supplied to CBO staff 

(April 23, 2013).

8. According to a recent report, “Analysis predicts that extended and 

additional deployments will negatively impact personnel retention 

rates.” See Office of the Chief of Naval Operations, Naval Vessels 

and the Force Structure Assessment, Report to Congress (July 2014), 

p. 7. Although that report does not discuss or cite the particular 

analysis, in communications with CBO, the Navy indicated that 

its assessment was based on information from a report that longer 

and more frequent deployments resulted in reenlistment rates that 

were between 1.2 and 1.9 percentage points below those otherwise 

observed. See Heidi L.W. Golding and Henry S. Griffis, How Has 

PERSTEMPO’s Effect on Reenlistments Changed Since the 1986 

Navy Policy? (CNA Corporation, July 2004), http://tinyurl.com/

lp2xonr. 

9. Bill Gortney, “Optimizing the Fleet Response Plan” (Navy 

briefing, January 14, 2014); Sam Fellman, “Navy’s New Plan 

Aims to Lock in 8-Month Carrier Deployments,” Navy Times

(January 15, 2014), http://tinyurl.com/nh2ktwv; and Marcus 

Hitchcock, “Optimizing the Fleet Response Plan” (Navy briefing 

to CBO staff, February 7, 2013). The Navy has described the 

lengths of deployments under the Optimized Fleet Response Plan 

as lasting “up to 8 months”; CBO used that deployment period 

for this report. See Bill Gortney and Harry Harris, “Applied 

Readiness,” Proceedings Magazine, vol. 140, no. 10, p. 1340 

(October 2014), http://tinyurl.com/npxphma. 

10. Wm. Brent Boning, Ship Depot Maintenance and Expected Service 

Life (CNA Corporation, February 2013). 
12 PRESERVING THE NAVY’S FORWARD PRESENCE WITH A SMALLER FLEET MARCH 2015

CBO

for maintaining amphibious warfare ships at that rate 

regardless of whether the additional time is the result of a 

longer deployment with single or multiple crews. The 

same types of assumptions were applied to all cases in 

which deployments were anticipated to exceed those of 

the Navy’s current plan or the Navy’s Optimized Fleet 

Response Plan.

Basing More Ships Overseas

Much more forward presence is possible when ships are 

based overseas or operated from overseas bases than is 

possible if those ships are based in the United States.11

When a ship is already overseas, no time is required for 

transit. (In many cases, it can take from one to five weeks 

to sail from a U.S. base to an overseas operating area and 

the same amount of time to return home.) Because of 

this, unless they are in maintenance, ships based overseas 

are considered to be on deployment even when they are 

in their home ports. With their different operating cycles, 

such ships can spend more time at sea conducting missions and still meet the guidelines for the period a crew is 

permitted to be away from its home port. A ship that is 

based in Japan, for example, can triple its forward presence compared with the amount it would supply if based 

in the continental United States.12

Since the end of World War II, the Navy has based a portion of its fleet outside the continental United States and 

Hawaii. At the end of 2013, the Navy had 29 ships, or 

about 10 percent of its fleet, stationed overseas (see 

Table 5). The largest concentration is in Japan, which is 

home to a carrier strike group consisting of one nuclearpowered aircraft carrier and nine cruisers and destroyers, 

and another group of amphibious warfare ships, consisting of one large amphibious assault ship and three smaller 

amphibious transport docks or dock landing ships. One 

command ship and four mine countermeasures ships also 

are based in Japan. In 2013, the Navy also had ships stationed in the U.S. territory of Guam, at the leased island 

of Diego Garcia (in the Indian Ocean), in Bahrain, and 

in Italy.

Over the next decade, the Navy plans to increase to 44 

the number of ships based overseas. Four destroyers are 

scheduled to operate from Spain by the end of 2015 (2 

were transferred in 2014; 2 will be transferred this year), 

and 16 littoral combat ships will ultimately operate from 

overseas bases (8 to replace retiring mine countermeasures 

ships, and 8 to be added to the Navy’s overseas fleet). The 

Navy also announced in April 2013 that it would transfer 

one additional attack submarine to Guam in 2015.13

More recently, the Navy announced it would base two 

additional destroyers in Japan—one in 2015 and one 

in 2017.

The major impediment to overseas basing is in obtaining 

permission from host governments; basing agreements for 

existing ships are renegotiated periodically, sometimes 

resulting in fewer ships’ being based overseas or leading to 

higher costs. For example, in response to a report released 

in August 2012 by the Center for Strategic and International Studies, the government of Australia explicitly 

rejected the center’s suggestion that the United States base 

aircraft carriers in that country.14 And even if agreements 

are reached, changes in a foreign government’s priorities 

can end a long-standing overseas-basing arrangement, as 

was the case for U.S. naval and air bases in the Philippines in the early 1990s. Political constraints are less 

likely to affect overseas bases in a U.S. territory, such as 

Guam, or at a leased location, such as Diego Garcia.

The expense of operating overseas presents another area 

of difficulty. For example, some initial investment is necessary to set up support facilities, and costs can vary 

widely depending on the number and type of ships at a 

base and whether infrastructure is already available. In 

addition, ships cost more to operate from an overseas 

base: Sea pay, fuel, and maintenance costs are higher, for 

example, because ships based overseas usually spend more 

time at sea than ships based in the United States. The 

Navy estimates that the annual cost of operating a ship 

based in Japan is about 20 percent greater than the cost 

of operating a U.S.-based ship. That expense could be 

11. Sailors assigned to ships based overseas may have their families 

accompany them; those assigned to ships operated overseas do not.

12. See, for example, Congressional Budget Office, An Analysis of the 

Navy’s Amphibious Warfare Ships for Deploying Marines Overseas

(November 2011), Box 2, www.cbo.gov/publication/42716. 

13. Gaynor Dumat-ol Daleno, “4th Submarine to Be Deployed,” 

Pacific Daily News (April 11, 2013), http://tinyurl.com/lpapbq4.

14. See Rod McGuirk, “Australia Rejects Proposal to Base U.S. 

Carrier,” Navy Times (August 2, 2012), http://tinyurl.com/

mug2c7y; and David J. Berteau and others, U.S. Force Posture 

Strategy in the Asia Pacific Region: An Independent Assessment

(Center for Strategic and International Studies, August 2012), 

http://tinyurl.com/bbhapgh.
MARCH 2015 PRESERVING THE NAVY’S FORWARD PRESENCE WITH A SMALLER FLEET 13

CBO

Table 5.

Number of Battle Force Ships Operating From Overseas Bases, by Location and Type

Source: Congressional Budget Office based on data from the Department of the Navy.

Notes: For its 2015 shipbuilding plan, the Navy changed the rules for counting battle force ships. Under that plan, small patrol craft based in 

Bahrain are counted in the battle force, but the same patrol craft based in the United States are not. In 2013, the Navy had four patrol 

craft based in Bahrain. Patrol craft are excluded from this table because in 2013 they were not counted as part of the Navy’s battle 

force and by 2025 all patrol craft will have been retired from the fleet.

n.a. = not applicable.

a. All mine countermeasures ships will be retired by 2024.

b. In 2013, the Navy had no littoral combat ships based overseas.

justified by the threefold increase in forward presence, 

however, and in some cases the costs are offset by support 

from the host country; the government of Japan contributes substantially to the support of U.S. military bases 

located there.15

Basing ships overseas also changes economic activity in 

the United States, thus creating an indirect cost. 

Typically, crew members’ families live where a ship is 

based, and much of the economic activity that comes 

from maintaining ships overseas (purchases of food, fuel, 

Japan

Aircraft carriers 1 1

Cruisers and destroyers 9 11

Amphibious ships 4 4

Command ships 1 1

Mine countermeasures ships

a 4 n.a.

Littoral combat ships

b n.a. 4

___ ___

Subtotal 19 21

Guam

Attack submarines 3 4

Fleet tender 1 1 _ _

Subtotal 4 5

Bahrain

Mine countermeasures ships

a 4 n.a.

Littoral combat ships

b n.a. 8

___ ___

Subtotal 4 8

Italy

Command ships 1 1

Diego Garcia 

Fleet tender 1 1

Spain

Destroyers 0 4

Singapore

Littoral combat ships

b n.a. 4

___ ___

Total 29 44

2013 2024 (Projected)

15. Michael J. Lostumbo and others, Overseas Basing of U.S. Military 

Forces: An Assessment of Relative Costs and Strategic Benefits (RAND 

Corporation, 2013), pp. 143–149, www.rand.org/pubs/

research_reports/RR201.html.
14 PRESERVING THE NAVY’S FORWARD PRESENCE WITH A SMALLER FLEET MARCH 2015

CBO

and some repair activities) and some of the families’ 

household spending would occur in and benefit host 

countries. When ships are based in the United States, 

such economic activity stays in the area around the ships’ 

home ports.

Rotating Crews

The third and most technically challenging method that 

the Navy uses to increase its forward presence is to rotate 

crews on and off its ships, whether they are based in the 

United States or operating from overseas ports.16 The 

Navy currently employs various crewing arrangements 

and has experimented with others. The standard model 

has a single crew that stays with a ship during the maintenance, training, and deployment phases of the operating 

cycle. In other cases, two or more crews can be assigned 

to a single ship. For example, since the early 1960s, the 

Navy’s ballistic missile submarines have been staffed by 

dual crews.17 Thus, on today’s Ohio class submarines, a 

pair of crews—designated blue and gold—alternates in 

deployments of two and a half months, with an intervening maintenance period of about a month per rotation. 

The Navy has adapted that construct for other ships in 

the fleet (see Table 6). The length of deployment varies 

by ship class, but the result is the same: When crews alternate and maintenance time is shared, a ship can provide 

more forward presence than is possible with a single crew.

Another approach is a multiple-crewing arrangement in 

which crews rotate among ships of the same class; thus, 

one crew could staff a different ship each time it goes to 

sea. The Navy has used such rotations for its coastal 

patrol ships and some of its mine countermeasures ships. 

In the 2000s, the Navy conducted three multiple-crewing 

experiments—known as the Sea Swap—on Spruance and 

Arleigh Burke class destroyers. (Despite the project’s 

name, however, the crews were swapped in port rather 

than at sea.) The experiments consisted of keeping one 

ship deployed overseas while rotating the crews of two or 

three other ships to that one.18 The Navy concluded that 

the tests were a success, although the Government 

Accountability Office criticized their management, 

particularly concerning the collection of evaluation 

data.19 The Navy plans to change its rotation for its newly 

deployed littoral combat ships from a dual-crew arrangement in which the U.S.-based crews swap overseas to 

what is known as the 3.2.1 concept: Three U.S.-based 

crews operate two ships, one of which is deployed overseas at all times. 

In general, a rotation that involves more crews than ships 

will produce more forward presence than is possible with 

rotations that use equal numbers of crews and ships. 

Swapping the crews at overseas ports boosts the Navy’s 

forward presence by reducing transit time to and from 

ports in the United States, but it requires appropriate 

infrastructure overseas to support crew exchanges and 

regular maintenance. Although the exact amount of additional presence depends on the method of crew rotation, 

CBO’s analysis indicates that a dual- or multiple-crewed 

ship can provide between 1.4 times and 1.8 times the 

amount of presence that a single-crewed ship will provide 

and about half of what a ship with a home port overseas 

would provide.20

Nevertheless, crew rotation also poses several challenges. 

For much of its history, the Navy’s culture has fostered 

strong identification of a crew with its ship: A single crew 

trains on, operates, maintains, and lives for significant 

periods on a single vessel. Crew members often take considerable pride in serving on and maintaining a ship, and 

some sense of ownership can be lost if a ship has more 

than one crew. One result could be a loss in efficiency in 

maintenance. If a repair is required close to the time of a 

switch, for example, the current crew could leave the 

work to the next crew to accomplish. If a ship has a single 

crew, its members have no such option, and they could

16. For a more detailed discussion, see Congressional Budget Office, 

Crew Rotation in the Navy: The Long-Term Effect on Forward 

Presence (October 2007), www.cbo.gov/publication/19283.

17. Jessica Taylor, “USS George Washington (SSBN-598): The 

Nation’s First Boomer,” Undersea Warfare (Winter 2009), 

http://go.usa.gov/fA2x.

18. See Congressional Budget Office, Crew Rotation in the Navy: 

The Long-Term Effect on Forward Presence (October 2007), 

pp. 5–9, www.cbo.gov/publication/19283.

19. Government Accountability Office, Ship Rotational Crewing 

Initiatives Would Benefit From Top-Level Leadership, Navy-Wide 

Guidance, Comprehensive Analysis, and Improved Lessons-Learned 

Sharing, GAO-08-418 (May 2008), www.gao.gov/products/

GAO-08-418.

20. Congressional Budget Office, Crew Rotation in the Navy: 

The Long-Term Effect on Forward Presence (October 2007), 

www.cbo.gov/publication/19283; and Increasing the Mission 

Capability of the Attack Submarine Force (March 2002), 

www.cbo.gov/publication/13538.
MARCH 2015 PRESERVING THE NAVY’S FORWARD PRESENCE WITH A SMALLER FLEET 15

CBO

Table 6.

The Navy’s Continuing Operations and Past Experience With Crew Rotation, by Ship Class

Source: Congressional Budget Office based on data from the Department of the Navy.

Note: With multiple crewing, several crews rotate among several ships. The number of crews and the ships may be the same or the number 

of crews may be larger.

a. Four other ships, each with a single crew, are based in Japan.

Rotation Type Rotation Method

Ohio Ballistic Missile Submarines 14 28 Dual Crew Two crews assigned to a single ship alternate 

on deployment; the submarine returns to a 

U.S. port for maintenance and a change of 

crew.

Ohio Guided Missile Submarines 4 8 Dual Crew Similar to the rotation system for ballistic 

missile submarines, deployments are longer 

and some maintenance and crew changes 

occur at overseas ports.

Littoral Combat Ships 3 6 Dual or Multiple Crew Initially, two crews alternate in operating the 

ship and crew changes occur at an overseas 

port. The ships will be converted to a system 

of three crews for a pair of ships to keep one 

ship deployed at all times. Crew members live 

in the United States.

Cyclone Coastal Patrol Ships 8 13 Multiple Crew Before 2013, Bahrain was the home port for 

five ships; three were based in the United 

States. The 13 crews lived in the United 

States and rotated between deploying to the 

ships and Bahrain and training on the ships in 

the United States. In 2013, the ships were 

converted to single crews and all now have a 

home port in Bahrain, where the crews also 

live.

Avenger Mine Countermeasures Ships 9 9 Multiple Crew Before 2013, Bahrain was home to four ships; 

five more were based in the United States.a 

The nine crews lived in the United States and 

rotated between deploying to the ships in 

Bahrain and training on the ships in the 

United States. The ships in Bahrain and the 

United States were converted to single crews 

in 2013 and have home ports with their crews 

in those two countries.

Past Experience

Number of Number of 

 Ships Crews

Continuing Operations
16 PRESERVING THE NAVY’S FORWARD PRESENCE WITH A SMALLER FLEET MARCH 2015

CBO

be more motivated to complete the work in a timely 

manner.

Shifting from single to multiple crewing requires different 

procedures, additional personnel, and probably additional maintenance, and it could lead to a shorter service 

life for a ship. Training programs would need to account 

for the fact that more than one crew would operate a 

ship. Having additional crews would not only require the 

additional personnel to form the crew itself but would 

require additional trainers and recruiters as support personnel. Maintenance and repair costs also would increase 

and service life could decrease as a result of longer periods 

of operation. For example, if nuclear-powered submarines 

were deployed for longer periods, their power plants and 

pressure hulls would wear out faster, those ships’ normally 

fixed service lives could be shortened, and they would 

need to be replaced sooner than the Navy envisions under 

its current shipbuilding plans.

The Navy also would need to change its support systems 

for ships and their crews by enhancing facilities and organizations to provide maintenance in short, high-intensity 

periods; by establishing training simulators and facilities 

to maintain crew proficiency; and by expanding organizations and facilities for recruitment and training of additional sailors. (The Navy accomplishes all of those tasks 

for its ballistic missile submarines.) The larger the ship, 

the greater those challenges are likely to be. Thus, crew 

rotation may not be a good choice for nuclear-powered 

aircraft carriers or large-deck amphibious assault ships, 

which have crews that number in the thousands and 

require significant shore-based infrastructure. (However, 

aircraft carriers and amphibious assault ships, which are 

among the most expensive ships in the Navy’s fleet, could 

benefit from the efficiency offered by rotating crews.) For 

this report, CBO did not examine approaches that would 

use rotating crews on those ships. 

Analysis of Approaches to 

Maintaining a Forward Presence 

CBO examined two approaches that the Navy might pursue to maintain or increase its current forward presence 

with a smaller fleet under three targets for the shipbuilding budget—$16 billion, $14 billion, and $12 billion per 

year (see Table 1 on page 2): 

 Under Approach 1, the Navy would either lengthen 

deployments or increase their frequency in an 

operating cycle so that smaller fleets matched the 

current forward presence in each of the main ship 

types (aircraft carrier, large surface combatant, attack 

submarine, and amphibious warfare ship). For this 

analysis, CBO assumed that there would be no 

difference from the Navy’s current plans either in the 

number of ships based overseas or in the amount of 

rotational crewing used to staff certain ship classes. 

 Under Approach 2, which would apply to the same 

four types of ships, there would be no deployments 

longer than six months, but more ships would be 

based overseas and more ships would use crew 

rotation.

Although it would be possible to blend various elements 

in any of several combinations, CBO structured its analysis to illustrate the trade-offs between long deployments 

and other methods of operation. The analysis shows that 

if the Navy lengthened deployments by 17 percent to 

75 percent (depending on the ship type and the shipbuilding budget), it could maintain its current forward 

presence with fewer ships. Alternatively, by increasing the 

number of ships based overseas by 30 percent to 40 percent and by rotating crews on some or all of its large surface combatants, attack submarines, and amphibious 

warfare ships, the Navy could maintain the same amount 

of presence for each ship type without extending any 

deployments beyond six months.21

Each approach would involve greater operating costs for 

the ships and facilities affected by the changes in operating procedures. Those higher costs would offset some of 

the savings from reduced procurement budgets and from 

lower operation and support costs for a smaller fleet, and 

both approaches could pose drawbacks, including some 

involving recruitment and retention, as discussed earlier. 

Moreover, additional investment would be needed to 

build overseas bases and to establish dual or multiple 

crewing where it is not in use today. The introduction 

of rotating crews also could create new logistical and 

cultural challenges. Finally, although basing more ships 

overseas could provide assurance to U.S. allies and deter 

21. Ballistic missile submarines are counted in the fleet inventories 

and as ships employing rotating crews, but they were not counted 

in the forward-presence calculations because their number at sea 

at any time is classified.
MARCH 2015 PRESERVING THE NAVY’S FORWARD PRESENCE WITH A SMALLER FLEET 17

CBO

adversaries, it also might increase the fleet’s vulnerability 

to attack. 

Forward Presence Under an Annual Shipbuilding 

Budget of $16 Billion

Restricting the Navy’s shipbuilding budget to the 30-year 

historical average would produce a fleet of 251 ships by 

2044, CBO estimates. The Navy could maintain a forward presence of 113 ships—slightly more than the fleet 

provides today—either by using longer deployments for 

its aircraft carriers, large surface combatants (cruisers and 

destroyers), attack submarines, and amphibious warfare 

ships (Approach 1) or by using more overseas basing and 

rotation of crews on those ships (Approach 2).22

Approach 1. This approach would have the Navy use 

longer deployments for aircraft carriers, large surface 

combatants, attack submarines, and amphibious warfare 

ships, as follows: 

 U.S.-based aircraft carriers would be deployed for 

10 months in each 36-month operating cycle instead 

of the deployments of 8 months as specified under the 

Navy’s Optimized Fleet Response Plan (see Figure 3). 

 All U.S.-based large surface combatants (roughly 

three-fourths of such vessels; by 2044, all of them 

will be destroyers) would be deployed routinely for 

10 months out of 36, longer than normal since 2012 

for large surface combatants and even longer than the 

Navy currently plans for the future. 

 Eighteen of the Navy’s 39 attack submarines would be 

deployed for 7 months out of a 24-month cycle. Over 

the past several years, most attack submarines’ 

deployments have been 6 months or shorter. 

 All U.S.-based amphibious warfare ships (accounting 

for 85 percent of such vessels) would be deployed 

for 8 months out of 27. Since 2008, only a few 

deployments have lasted that long or longer, although 

they have become more common in recent years.

 All of the Navy’s small surface combatants would be 

littoral combat ships, which, according to the Navy’s 

plan, would use rotating crews. CBO’s analysis 

considered no changes in the deployment of those 

ships. 

 The number of combat logistics and support ships 

would remain about the same under the $16 billion 

budget as it is for today’s fleet. Each ship would spend 

about 70 percent of its time being operationally 

available, providing forward presence.

 The deployment cycles of all ships based overseas 

would remain unchanged.

Approach 2. Under this approach, the Navy could maintain the same forward presence as under Approach 1 by 

increasing the use of overseas basing and rotating crews, 

but limiting all deployments to six months (see Figure 4). 

Additional ships based overseas would include an aircraft 

carrier, 4 large surface combatants (for a total of 19; the 

current plan calls for 15), 7 attack submarines (the current plan calls for 4; some of the additional submarines 

would go to Guam, others would be based with the second overseas carrier), and 2 amphibious warfare ships (for 

a total of 6). The number of ships using rotating crews 

also would increase. The attack submarine force would 

have 6 ships that adopted a modified version of the 

Navy’s dual-crew system for ballistic missile submarines; 

all would continue to be based in the continental United 

States.23 (Table A-1 in the appendix provides additional 

detail about the number of ships based overseas or having 

rotating crews at the end of 2013, under the Navy’s 2015 

plan, and under the two approaches discussed here.)

Forward Presence Under an Annual Shipbuilding 

Budget of $14 Billion 

If the Navy’s shipbuilding budget was limited to the 

amounts that the service has spent over the past decade 

(and currently plans to spend over the next five years, on 

average, under the Department of Defense’s 2015 Future 

Years Defense Program), by 2044, the fleet would number 230 ships, 51 fewer than it has today and 73 fewer 

22. The increase in forward presence from today’s amount represents 

the greater forward presence provided by the larger number of 

littoral combat ships that would be serving in the fleet by 2044; 

there were just four such ships in 2014.

23. For a detailed discussion of how dual crews could be applied to 

attack submarines, see Congressional Budget Office, Increasing the 

Mission Capability of the Attack Submarine Force (March 2002), 

www.cbo.gov/publication/13538.
18 PRESERVING THE NAVY’S FORWARD PRESENCE WITH A SMALLER FLEET MARCH 2015

CBO

Figure 3.

Deployments That Would Maintain the Same Amount of Forward Presence in 2044 as in 2013 

With Smaller Fleets Than Under the Navy’s Plan

Source: Congressional Budget Office.

Notes: CBO calculated the percentage of ships with longer deployments by using the Navy’s inventory of ships based in the United States 

and overseas.

Under the Navy’s current plan for forward presence, the overseas-based forces after 2044 would include 1 aircraft carrier, 15 large 

surface combatants, 4 attack submarines, and 4 amphibious warfare ships. 

The aircraft carriers, large surface combatants, and eventually amphibious warfare ships would have one 8-month deployment over

36 months; attack submarines would have one 6-month deployment over 24 months. CBO’s analysis included the assumption that 

the 36-month cycle would apply to aircraft carriers and surface combatants but the existing 27-month cycle would be retained for

amphibious warfare ships.

When ships are not deployed, they are undergoing maintenance, their crews are in training, or they are in sustainment and ready

for deployment on short notice.

than called for under its 2015 shipbuilding plan.24 With a 

budget of $14 billion, the Navy could maintain a forward 

presence of 111 ships (which is greater than today’s presence of about 100) by relying on longer deployments for 

aircraft carriers, large surface combatants, attack submarines, and amphibious warfare ships (under Approach 

1). Alternatively, it could provide 112 ships by basing 

more ships overseas and using more crew rotation 

(Approach 2). But those approaches would have to be 

implemented more aggressively than would be required 

under a larger shipbuilding budget.

$12 Billion

$14 Billion

$16 Billion

$12 Billion

$14 Billion

$16 Billion

$12 Billion

$14 Billion

$16 Billion

$12 Billion

$14 Billion

$16 Billion

0 20 40 60 80 100 0 6 12 18 24 30 36

12 10 14

6 6 9 6 9

6 7 7 7 9

12 10 14

6 6 9 6 9

6 7 7 7 9

6 7 11

6 7 11

6 7 11

6 8 13

6 9 12

6 9 12

Aircraft Carriers

Large Surface Combatants

Attack Submarines

Amphibious Warfare Ships

8 of 9

7 of 8

6 of 7

55 of 70

49 of 64

40 of 55

18 of 39

22 of 37

25 of 35

23 of 27

22 of 26

21 of 25

Average Annual

Shipbuilding Budget

Percentage of Ships With Longer Deployments

Months

Operating Cycles for Ships With Longer Deployments

Percentage

Deployment

36

36

36

36

36

36

24

24

24

27

27

27

24. See Congressional Budget Office, An Analysis of the Navy’s Fiscal 

Year 2015 Shipbuilding Plan (December 2014), www.cbo.gov/

publication/49818.
MARCH 2015 PRESERVING THE NAVY’S FORWARD PRESENCE WITH A SMALLER FLEET 19

CBO

Figure 4.

Additional Ships Based Overseas and Additional Rotating Crews That Would Maintain the Same 

Amount of Forward Presence in 2044 as in 2013 With Smaller Fleets Than Under the Navy’s Plan

Number of Ships

Source: Congressional Budget Office.

Notes: Ships based overseas are counted separately from those with rotating crews. At the end of 2013, the Navy based overseas 1 aircraft 

carrier, 9 surface combatants, 3 attack submarines, and 4 amphibious ships. It also based overseas 12 other ships of different types.

n.a. = not applicable.

a. Under the $12 billion budget, another aircraft carrier would be transferred from the continental United States to Hawaii.

b. Uses multiple crewing.

c. Uses a dual-crew system modeled in part on the existing system for ballistic missile submarines.

Approach 1. Under this approach, deployments would be 

longer or more frequent than if the annual shipbuilding 

budget was set for a $16 billion average (see Figure 3): 

 The Navy would adopt a variant of its Enhanced 

Carrier Presence Plan (that it proposed in 2013) 

instead of its plan to conduct 8-month-long carrier 

deployments under the Optimized Fleet Response 

Plan (or 10-month deployments discussed above 

for the $16 billion shipbuilding budget).25 Each 

U.S.-based aircraft carrier would be deployed for 

12 months out of a 36-month operating cycle—

twice for 6 months with an interval of 9 months 

between deployments (see Figure 2 on page 9). 

 All U.S.-based large surface combatants would follow 

the same 36-month deployment schedule as the 

aircraft carriers. 

 Twenty-two U.S.-based attack submarines—four 

more than under the $16 billion budget—would 

routinely conduct 7-month deployments.

 All U.S.-based amphibious warfare ships would be 

deployed for 9 months out of a 27-month cycle. 

 There would be no changes in the operation of littoral 

combat ships or any ships based overseas from the 

current plan. As is the case for the $16 billion budget, 

the number of support ships would remain about the 

same as it is for today’s fleet.

Additional Ships Based Overseas Additional Ships With Rotating Crews

n.a. n.a. n.a.

Aircraft

Carriers

Large

Surface

Combatants

Attack

Submarines

Amphibious

Warfare

Ships

0

2

4

6

8

10

Aircraft

Carriers

Large

Surface

Combatants

Attack

Submarines

Amphibious

Warfare

Ships

0

2

4

6

8

10 $16 Billion

$14 Billion

$12 Billion

b

a c

25. Before it adopted the Optimized Fleet Response Plan, the Navy 

considered another approach, the Enhanced Carrier Presence 

Plan, for its aircraft carriers. That plan called for an operating 

cycle of two 7-month deployments out of 36 months, with a 

7-month interval between them—compared with the previous 

cycle of 6 to 7 months out of 32 and possibly an additional 2- or 

3-month deployment. The Enhanced Carrier Presence Plan would 

have provided an additional carrier deployed overseas. Specifically, 

the Navy estimated that, for a cost increase of 20 percent for 

carrier operations (including the air wing), average global carrier 

presence would increase by 40 percent. The drawback was that 

crews would have spent more time at sea over the 36-month 

operating cycle than they would under the normal operating cycle. 

Spending caps imposed by the Budget Control Act of 2011 led 

the Navy to forgo the plan. See Jason Kelly, “Enhanced Carrier 

Presence—What Do I Need to Know...Why Should I Care?” 

Navy Live (blog entry, April 22, 2013), http://go.usa.gov/fAEj. 
20 PRESERVING THE NAVY’S FORWARD PRESENCE WITH A SMALLER FLEET MARCH 2015

CBO

Approach 2. Under this approach, the Navy could maintain a forward presence of 112 ships under an annual 

shipbuilding budget of $14 billion by increasing its use 

of overseas basing and crew rotation but still limiting all 

ship deployments to 6 months. Overseas basing for the 

four ship types (aircraft carrier, large surface combatant, 

attack submarine, and amphibious warfare ship) would 

match that discussed above for a $16 billion annual budget (see Figure 4 on page 19). This approach would put a 

second carrier overseas, increase the number of large surface combatants based overseas from today’s planned 

15 ships to 19, increase the number of attack submarines 

based overseas from a planned 4 to 11, and increase the 

number of amphibious warfare ships overseas from 

4 to 6. 

Approach 2 would have more ships using rotating crews 

than would be the case under a $16 billion budget. Six 

large surface combatants would use multiple crews: Two 

of those six would remain at a forward operating location 

and the crews of the remaining ships would rotate to 

those ships to increase the overall amount of presence 

provided by the group. That forward-based ship would 

return to the United States less frequently than it would 

under the regular operating cycle. Two smaller amphibious warfare ships would have rotating crews; there are 

none in today’s Navy and none are included under 

Approach 2 for a $16 billion budget. The attack submarine force would have eight ships with dual crews 

operating out of U.S. ports, two more than under the 

$16 billion budget.

Forward Presence Under an Annual Shipbuilding 

Budget of $12 Billion 

If the Navy received annual funding for shipbuilding that 

was equivalent to the amounts it spent in the 1990s, by 

2044 its fleet of battle force ships would number 208. 

The Navy could maintain its forward presence at 108 to 

110 ships by relying even more heavily on longer deployments or overseas basing and crew rotation than would be 

called for under a $14 billion annual budget.

Approach 1. Under this approach, the Navy would 

deploy most aircraft carriers and large surface combatants 

for longer periods than it would with a $14 billion budget (see Figure 3 on page 18):

 U.S.-based aircraft carriers would employ the 

Enhanced Carrier Presence Plan rather than the 

Optimized Fleet Response Plan. However, with one 

fewer carrier than under a $14 billion budget, the 

U.S.-based ships would conduct two 7-month 

deployments, with 7 months intervening, out of a 

36-month operating cycle. The total period of 

deployment thus would be 2 months longer than 

under a $14 billion budget. 

 The operating cycle for all U.S.-based large surface 

combatants would parallel that for the aircraft carriers. 

 Twenty-five of the Navy’s U.S.-based attack 

submarines—three more than under a $14 billion 

budget—would be deployed for 7 months out of a 

24-month cycle. 

 All U.S.-based amphibious warfare ships would be 

deployed for 9 months out of the 27-month cycle. 

 There would be no changes from the current plan in 

the Navy’s operation of its littoral combat ships.

 The number of support ships providing forward 

presence would remain about the same under a 

$12 billion budget as it is for today’s fleet.

Approach 2. With a $12 billion average annual budget 

for shipbuilding, the Navy could maintain its forward 

presence by increasing the use of overseas basing and crew 

rotation and thereby limit all ship deployments to six 

months. The Navy would base two additional aircraft 

carriers overseas, while another carrier would be transferred from the continental United States to Hawaii (see 

Figure 4 on page 19). Thus, with a force of seven aircraft 

carriers, only three would remain based in the continental 

United States. 

The number of other ships based overseas also would 

increase. The fleet of large surface combatants with home 

ports in other countries would increase from 15 under 

today’s plans to 20 under a $12 billion budget, the number of attack submarines would increase from 4 to 13, 

and the number of amphibious warfare ships would 

increase from 4 to 6.

Crew rotations would increase as well. The force of 

large surface combatants would consist of 10 ships and 

2 amphibious warfare ships using multiple or dual crew 

rotation. The attack submarine force would have 10 ships 

using dual crews. 
MARCH 2015 PRESERVING THE NAVY’S FORWARD PRESENCE WITH A SMALLER FLEET 21

CBO

Cost Implications 

Although the Navy would spend less money on ship 

construction and operations with smaller fleets (as well as 

saving on aircraft procurement and operations because of 

the need to buy and maintain fewer carrier air wings), 

those reductions would be partly offset by the additional 

costs of maintaining a forward presence. By CBO’s estimate, the savings attributable to the smaller fleet would 

be offset by less than 5 percent to about 10 percent under 

a $16 billion annual budget for ship construction and by 

23 percent to 45 percent under a $12 billion budget, 

depending on the approach taken. After factoring in 

those offsets, CBO estimates that the smaller fleets would 

result in net savings averaging $10 billion to $17 billion 

or more a year (see Table 7).

CBO’s estimates of the savings in operation and support 

costs are based on the agency’s assumption of roughly 

proportional cuts in the various ship forces within the 

fleet, initially without considering any adjustments 

needed to maintain the current forward presence.26 Thus, 

the cost in 2044 to operate the 208-ship fleet under a 

$12 billion annual budget would be $30 billion—about 

two-thirds of the $43 billion cost in the same year to 

operate the 303-ship fleet anticipated in the Navy’s 2015 

shipbuilding plan. CBO relied on current operating costs 

to estimate costs for 2044, even though the design specifics of the ships of the future, and thus their costs, cannot 

be reliably estimated today. If the estimated reduction in 

operations spending is added to the assumed cuts in ship 

construction, total annual savings in 2044—out of a total 

annual cost of $64 billion estimated for that year under 

the Navy’s 2015 plan—would be $11 billion under a 

$16 billion shipbuilding budget and $22 billion under 

a $12 billion budget (all measured in 2014 dollars).

Those savings would be partially offset by the cost of 

steps taken to maintain the Navy’s forward presence. 

Although they are difficult to estimate precisely, CBO 

formulated some rough estimates of additional, recurring 

annual costs (including military pay and benefits, operations, and maintenance) and onetime costs (such as infrastructure construction) for each approach. To project 

recurring costs, CBO used information from the Future 

Years Defense Program, among other sources, and to estimate onetime costs it relied on several sources, but most 

heavily on a forthcoming RAND report.27 In general, 

projected costs for Approach 2 are greater than those for 

Approach 1.

Net Savings Under Approach 1. Recurring costs from longer and more frequent deployments would include 

increased spending on ship maintenance, fuel, and sea 

pay. CBO increased its estimates of maintenance costs 

according to the proportion of maintenance days to at-sea 

days under the various ships’ operating cycles. For example, if there is a 1-to-3 ratio of maintenance to at-sea days 

for an amphibious warfare ship, a deployment of two 

additional months, resulting in 30 additional days at 

sea, would increase the ship’s time in maintenance by 

10 days.28

On that basis, CBO estimates that the additional costs 

for maintenance and fuel from longer deployments could 

amount to a few hundred million dollars per year under a 

$16 billion budget but would probably run to a few billion dollars per year under a $12 billion budget. Moreover, in the latter case, additional sea pay would add as 

much as several hundred million dollars per year to the 

Navy’s operating budget. Overall, those recurring costs 

under Approach 1 would reduce annual procurement and

26. Operation and support costs include the amounts paid from 

the Navy’s military personnel appropriation for military pay 

and bonuses and those paid from the Navy’s operation and 

maintenance appropriation for civilian salaries, military health 

care, daily operation of the Navy’s units, maintenance of 

equipment, training, support contractors, and so on. CBO added 

the costs of operating carrier air wings to the costs of the aircraft 

carriers themselves but did not include any savings that might 

come from purchasing fewer aircraft for those wings. CBO’s 

estimates are based on data for the 2015–2019 period as outlined 

in the Department of Defense’s (DoD’s) 2015 Future Years 

Defense Program. (In that five-year plan, DoD does not account 

for potential supplemental or emergency appropriations to fund 

ongoing operations.) CBO’s estimates include a share of the 

Defense Health Program’s costs that support sailors assigned to 

ships and air wings (and their families) but that would be paid for 

out of non-Navy accounts in DoD’s budget. CBO also included 

the costs of recruiting and training sailors, which it estimated as a 

fraction of the recruitment and training budgets for sailors 

assigned to the ships and air wings considered for this report.

27. Michael McMahon and Roland Yardley, Alternatives to Increase 

Carrier Strike Group (CSG) Forward Posture (RAND Corporation, 

forthcoming).

28. The Navy’s budget calls for 45 days at sea for every 90 days when a 

ship is deployed—or one-half the time. When the ship is not 

deployed, the budget calls for 20 days at sea out of every 90. 
22 PRESERVING THE NAVY’S FORWARD PRESENCE WITH A SMALLER FLEET MARCH 2015

CBO

Table 7.

Costs for and Savings From Maintaining Forward Presence Under 

Alternative Shipbuilding Budgets

Billions of 2014 Dollars

Source: Congressional Budget Office.

Notes: Ships’ operating costs are based on current amounts.

n.a. = not applicable.

a. Operation and support costs include the amounts paid from the Navy’s military personnel appropriation for military pay and bonuses 

and those paid from the Navy’s operation and maintenance appropriation for civilian salaries, military health care, daily operation of 

the Navy’s units, maintenance of equipment, training, support contractors, and so on. CBO added the costs of operating carrier air 

wings to the costs of the aircraft carriers themselves. CBO’s estimates are based on data for the 2015–2019 period as outlined in the 

Department of Defense’s (DoD’s) 2015 Future Years Defense Program. (In that five-year plan, DoD does not account for potential supplemental or emergency appropriations to fund ongoing operations.) CBO’s estimates include a share of the Defense Health Program’s costs 

that support sailors assigned to ships and air wings (and their families), although that would be paid for out of non-Navy accounts in 

DoD’s budget. CBO also included the costs of recruiting and training sailors, which it estimated as a fraction of the recruitment and 

training budgets for sailors assigned to the ships and air wings considered for this report.

b. Figures are for operation and support costs before adjustment using either Approach 1 or Approach 2.

c. Sea pay does not include additional retention bonuses, which could be required to meet retention goals with longer deployments.

Number of Battle Force Ships in 2044 303 251 230 208

Annual Operation and Support Costs for 

Battle Force Shipsa

Approach 1: Longer Deployments

Ship maintenance and fuel n.a.

Sea payc n.a.

Approach 2: More Overseas Basing and

Crew Rotation

Ship maintenance and fuel n.a.

Additional crews, traning, and 

base operations n.a.

Approach 1: Longer Deployments n.a.

Approach 2: More Overseas Basing and

Crew Rotation n.a.

Approach 1: Longer Deployments n.a. 0 0 0

Approach 2: More Overseas Basing and

Crew Rotation

Overseas bases n.a.

U.S.-based infrastructure n.a.

Source: Congressional Budget Office.

A few hundred million dollars

$16 Billion $14 Billion $12 Billion

Average Annual Shipbuilding Budget 

$43 billion

A few hundred million dollars

About $100 million

2015 Plan

($21 Billion)

$37 billionb

Several hundred million dollars

$30 billionb $33 billionb

Navy's 

Several hundred million dollars

$16 billion to $25 billion

Several billion dollars

Several hundred million dollars

A few billion dollars

$3 billion to $10 billion

A few hundred million dollars

Several hundred million dollars

A few hundred million dollars

A few billion dollars

A few hundred million dollars

$3 billion to $10 billion

Net Average Annual Recurring Savings by 2044

Additional Onetime Costs From 2015 Through 2044

Additional Annual Operation and Support Costs by 2044

$11 billion $16 billion $17 billion or more

$10 billion $12 billion or more $12 billion or more

Several hundred million dollars A few billion dollars
MARCH 2015 PRESERVING THE NAVY’S FORWARD PRESENCE WITH A SMALLER FLEET 23

CBO

operating savings from buying and operating smaller 

fleets by less than 5 percent under a $16 billion budget, 

but by as much as 20 percent under a $12 billion budget. 

Nevertheless, net annual savings would still range from 

roughly $11 billion to $17 billion for the three differentsized fleets considered in this analysis. 

Other potential recurring costs that CBO did not include 

in its analysis are the differences in sea pay and retention 

bonuses that might be needed if longer deployments 

caused the Navy to regularly miss its retention goals. If 

such increases turned out to be necessary, Approach 1 

would cost somewhat more, although not enough to 

offset the lower costs of building and operating a smaller 

fleet. That approach would not involve any additional 

onetime costs.

Net Savings Under Approach 2. The recurring costs for 

ship maintenance and fuel that arise from basing more 

ships overseas and using rotating crews would be roughly 

the same as those calculated for Approach 1. But the cost 

of paying, training, and housing the additional personnel 

that would be needed to maintain rotating crews plus the 

cost of operating new overseas carrier bases would 

amount to several hundred million dollars annually 

under a $16 billion shipbuilding budget—and several 

billion dollars a year under a $12 billion budget, mostly 

because of the large number of additional crews needed 

to maintain forward presence with such a small fleet.

All together, recurring costs under Approach 2 would 

offset 10 percent of the savings arising from buying and 

operating the smaller fleets under a $16 billion budget 

and as much as 45 percent of the savings under a $12 billion budget. Net annual savings would amount roughly 

to $10 billion to $12 billion for the three different-sized 

fleets considered in this analysis. Moreover, some recurring costs could be shared by the host country—Japan 

and South Korea, for example, help defray expenses for 

U.S. forces stationed in those countries—but CBO did 

not account for that possibility in its analysis.

Unlike Approach 1, Approach 2 would result in significant onetime costs: Billions of dollars would be required 

to build new overseas bases, particularly for aircraft carriers. Although CBO has not formulated independent estimates, a report that was released in August 2012 by the 

Center for Strategic and International Studies proposed 

basing an aircraft carrier in Australia and estimated the 

costs of doing so. The report stated that the cost of 

establishing an aircraft carrier base in Guam several years 

ago had been estimated at about $6.5 billion.29 Unofficial 

Navy estimates put the onetime price of basing a carrier 

in Australia at about $10 billion. RAND’s forthcoming 

report estimates fixed costs of about $1 billion to base a 

second carrier in Japan and $4 billion to $10 billion to 

base one in Guam.30 Although the RAND report did not 

examine the Australia option in detail, the costs would 

probably be comparable to those for Guam. For two 

additional carriers based overseas the costs would be 

higher. In addition, some small additional infrastructure 

costs (mostly for training facilities) would be required in 

the United States to support the new systems for rotating 

crews to large surface combatants, attack submarines, and 

amphibious warfare ships. CBO estimates onetime costs 

of $3 billion to $10 billion to provide forward presence 

under the $14 billion and $16 billion shipbuilding 

budgets and of $16 billion to $25 billion under the 

$12 billion budget. Those onetime costs would not 

exceed about two years of annual savings.

Costs Not Considered in CBO’s Analysis. Additional costs 

that were not considered in this analysis would accrue 

after 2044 under either approach. Because more intensive 

use of nuclear-powered aircraft carriers and attack submarines would shorten the service lives of those weapon 

systems, replacement would occur sooner than is dictated 

by current schedules. The service life of a dual-crewed 

attack submarine, at about 27 years, would be 18 percent 

shorter than the 33 years currently anticipated for a 

single-crewed submarine.31 An aircraft carrier operating 

under the Enhanced Carrier Presence Plan could have a 

service life of about 45 years, 10 percent shorter than the 

Navy’s current plan of 50 years. In contrast, more intensive use of surface ships (which are not nuclear powered) 

29. David J. Berteau and others, U.S. Force Posture Strategy in the Asia 

Pacific Region: An Independent Assessment (Center for Strategic and 

International Studies, August 2012), p. 74, http://tinyurl.com/

bbhapgh.

30. Michael McMahon and Roland Yardley, Alternatives to Increase 

Carrier Strike Group (CSG) Forward Posture (RAND Corporation, 

forthcoming). Most of the uncertainty in RAND’s cost analysis 

for Guam lies in the investment needed to improve the land-based 

airfield on the island that would support the carrier’s air wing 

when the ship is in port. Further study of that issue would be 

necessary if the Guam option was chosen.

31. See Congressional Budget Office, Increasing the Mission Capability 

of the Attack Submarine Force (March 2002), www.cbo.gov/

publication/13538.
24 PRESERVING THE NAVY’S FORWARD PRESENCE WITH A SMALLER FLEET MARCH 2015

CBO

would not necessarily result in a shorter service life as 

long as the Navy’s maintenance protocols compensated 

for the increased operational use.32 Even if the added 

costs of reduced service life were considered to be accrued 

during the period addressed in this analysis, they would 

not offset a substantial portion of the annual savings 

projected for the two approaches discussed here.

32. Wm. Brent Boning, Ship Depot Maintenance and Expected Service 

Life (CNA Corporation, February 2013). 
CBO

Appendix: Comparison of Different-Sized Fleets 

Under Two Approaches to 

Maintaining Forward Presence

The Navy’s 30-year shipbuilding plan envisions 

building a fleet of 306 ships (it would have 303 ships in 

2044). The funding required to implement that plan, 

however, is considerably more than the amounts the 

Navy has received over the past 30 years. The Congressional Budget Office projected the size of the Navy’s fleet 

with annual funding of $16 billion, $14 billion, and 

$12 billion, and it examined two approaches for 

maintaining the Navy’s forward presence with smaller 

fleets. The first approach would emphasize longer deployments than under current practice; the second would 

emphasize more overseas basing and more crew rotation 

than is the case under current practice. Table A-1 is a 

summary of key data for comparing the three resulting 

fleets under the two approaches.
26 PRESERVING THE NAVY’S FORWARD PRESENCE WITH A SMALLER FLEET MARCH 2015

CBO

Table A-1. 

Number and Status of Ship Types, Deployment Lengths, and Basing and Crew Rotation 

Under Two Approaches and Several Alternative Shipbuilding Budgets, 2044

Ship Count

Continued

Total Battle Force Ships 289 303 251 230 208 251 230 208

Ships Providing a Forward Presence 

at Any Given Time 103 130 113 111 108 113 112 110

Ships Conducting 6-Month Deployments 0 0 0 0 0 7 6 4

Ships Conducting 7- to 8-Month 

Deployments 7 9 0 0 0 0 0 0

Ships Conducting 8-Month or Longer 

Deployments 2 0 8 7 b 6 b 000

Ships Based Overseas 1 1 1 1 1 2 2 3

Ships With a Rotating Crew 0 0 0 0 0 0 0 0 __ __ __ __ __ __ __ __

Ship Inventory 10 10 9 8 7 9 8 7

Ships Conducting 6-Month Deployments 0 0 0 0 0 53 39 25

Ships Conducting 7- to 8-Month 

Deployments 63 83 0 0 0 0 0 0

Ships Conducting 8-Month or Longer 

Deployments 12 0 57 49 b 40 b 000

Ships Based Overseas 9 15 15 15 15 19 19 20

Ships With a Rotating Crew 0 0 0 0 0 0 6 c 10 c

__ __ __ __ __ __ __ __

Ship Inventory 84 83 72 64 55 72 64 55

Ships Conducting 6-Month Deployments 15 n.a. n.a. n.a. n.a. n.a. n.a. n.a.

Ships Conducting 7- to 8-Month 

Deployments 3 n.a. n.a. n.a. n.a. n.a. n.a. n.a.

Ships Conducting 8-Month or Longer 

Deployments 0 n.a. n.a. n.a. n.a. n.a. n.a. n.a.

Ships Based Overseas 8 16 16 16 16 16 16 16

Ships With a Rotating Crew 9 52 37 32 27 37 32 27 __

Ship Inventory 35 52 d 37 d 32 d 27 d 37 d 32 d 27 d

Aircraft Carriers

Large Surface Combatants

Small Surface Combatants and Mine Countermeasures Ships

2013

Navy's 

$12 Billion

Crew Rotation

Approach 2: 

More Overseas Basing and 

($21 Billion) $16 Billion $14 Billion

2015 Plan

$16 Billion $14 Billion $12 Billion

Approach 1: 

Longer Deployments

Inventorya
APPENDIX PRESERVING THE NAVY’S FORWARD PRESENCE WITH A SMALLER FLEET 27

CBO

Table A-1. Continued

Number and Status of Ship Types, Deployment Lengths, and Basing and Crew Rotation 

Under Two Approaches and Several Alternative Shipbuilding Budgets, 2044

Ship Count

Source: Congressional Budget Office.

Notes: Deployments for ships with rotating crews are longer than 9 months, although the crews are deployed for much shorter periods. 

n.a. = not applicable.

a. Ship counts refer to the entire operating cycle.

b. All aircraft carrier and large surface combatant deployments would follow the Navy’s enhanced carrier presence plan. Deployments might 

last 6 or 7 months, but two deployments would occur within a 21-month period and the 36-month operating cycle.

c. Uses multiple crew rotation; ships are based in the United States. 

d. The small surface combatant and mine countermeasures inventory in the future will consist of littoral combat ships and therefore all will 

have rotating crews but not all will be based overseas. 

e. Uses a dual-crew system modeled in part on the existing system for ballistic missile submarines; submarines are based in the 

United States.

f. All deployments are nearly 9 months long.

g. All ballistic missile and guided missile submarines operate dual crews but are not counted in totals for a forward presence.

h. Most combat logistics and support ships operate with civilian mariners and are available for forward presence 270 days of the year.

Ships Conducting 6-Month Deployments 43 48 17 11 6 22 18 12

Ships Conducting 7- to 8-Month 

Deployments 8 0 18 22 25 0 0 0

Ships Conducting 8-Month or Longer 

Deployments 1 0 0 0 0 0 0 0

Ships Based Overseas 3 4 4 4 4 11 11 13

Ships With a Rotating Crew 0 0 0 0 0 6 e 8 e 10 e

__ __ __ __ __ __ __ __

Ship Inventory 55 52 39 37 35 39 37 35

Ships Conducting 6-Month Deployments 0 0 0 0 0 21 18 17

Ships Conducting 7- to 8-Month 

Deployments 19 27 0 0 0 0 0 0

Ships Conducting 8-Month or Longer 

Deployments 8 0 23 f 22 f 21 f 000

Ships Based Overseas 4 4 4 4 4 6 6 6

Ships With a Rotating Crew 0 0 0 0 0 0 2 2 __ __ __ __ __ __ __ __

Ship Inventory 31 31 27 26 25 27 26 25

Ship Inventory 18 12 10 8 6 10 8 6

Ship Inventory 56 63 59 55 53 59 55 53

Ballistic and Guided Missile Submarinesg

Combat Logistics and Support Shipsh

Amphibious Warfare Ships

Attack Submarines

Approach 2: 

2013

Navy's More Overseas Basing and 

2015 Plan Longer Deployments

Approach 1: 

Crew Rotation

Inventory $16 Billion $14 Billion $12 Billion a ($21 Billion) $16 Billion $14 Billion $12 Billion
28 PRESERVING THE NAVY’S FORWARD PRESENCE WITH A SMALLER FLEET MARCH 2015

CBO

List of Tables and Figures

Tables

1. Fleet Characteristics and Costs of Maintaining the Navy’s Forward Presence Under 

Various Shipbuilding Budgets, 2044 2

2. CBO’s Projections of Purchases and Costs of New Battle Force Ships Under 

Alternative Shipbuilding Budgets, 2015–2044 5

3. Inventory of Battle Force Ships and Fleet Composition in Selected Years Under 

Alternative Shipbuilding Budgets 6

4. Major Deployments of U.S.-Based Combat Ships, 2007–2013 10

5. Number of Battle Force Ships Operating From Overseas Bases, by 

Location and Type 13

6. The Navy’s Continuing Operations and Past Experience With Crew Rotation, by 

Ship Class 15

7. Costs for and Savings From Maintaining Forward Presence Under Alternative 

Shipbuilding Budgets 22

A-1. Number and Status of Ship Types, Deployment Lengths, and Basing and 

Crew Rotation Under Two Approaches and Several Alternative 

Shipbuilding Budgets, 2044 26

Figures

1. Inventories of Selected Ship Types Under Various Annual Shipbuilding Budgets, 2044 7

2. Current and Notional Operating Cycles for a Nuclear-Powered Aircraft Carrier 9

3. Deployments That Would Maintain the Same Amount of Forward Presence in 

2044 as in 2013 With Smaller Fleets Than Under the Navy’s Plan 18

4. Additional Ships Based Overseas and Additional Rotating Crews That Would 

Maintain the Same Amount of Forward Presence in 2044 as in 2013 With 

Smaller Fleets Than Under the Navy’s Plan 19
MARCH 2015 PRESERVING THE NAVY’S FORWARD PRESENCE WITH A SMALLER FLEET 29

CBO

About This Document

This Congressional Budget Office report was prepared at the request of the former Chairman and the 

former Ranking Member of the Seapower and Projection Forces Subcommittee of the House Armed 

Services Committee. In accordance with CBO’s mandate to provide objective, impartial analysis, the 

report makes no recommendations.

Eric Labs of CBO’s National Security Division prepared the report with guidance from David Mosher 

and Matthew Goldberg. Raymond Hall of CBO’s Budget Analysis Division produced the cost estimates with guidance from Sarah Jennings. David Arthur of CBO provided helpful comments on the 

report, as did Bryan Clark of the Center for Strategic and Budgetary Assessments and Scott Truver of 

Gryphon Technologies LC. (The assistance of external reviewers implies no responsibility for the final 

product, which rests solely with CBO.)

Jeffrey Kling, John Skeen, and Robert Sunshine reviewed this report; Kate Kelly edited it; and 

Maureen Costantino prepared it for publication. An electronic version is available on CBO’s website 

(www.cbo.gov/publication/49989).

Douglas W. Elmendorf 

Director

March 2015