a

GAO

United States Government Accountability Office

Report to Congressional Committees

July 2004 DEFENSE 

INFRASTRUCTURE

Factors Affecting U.S. 

Infrastructure Costs 

Overseas and the 

Development of 

Comprehensive 

Master Plans

GAO-04-609
www.gao.gov/cgi-bin/getrpt? -GAO-04-609.

To view the full product, including the scope 

and methodology, click on the link above. 

For more information, contact Barry W. 

Holman at (202) 512-8412 or 

holmanb@gao.gov. 

Highlights of GAO-04-609, a report to 

congressional committees 

July 2004

DEFENSE INFRASTRUCTURE 

Factors Affecting U.S. Infrastructure 

Costs Overseas and the Development of 

Comprehensive Master Plans 

At the time of our review, overseas regional commands had not yet begun 

developing the comprehensive master plans required to be submitted with 

the fiscal year 2006 budget submission in early 2005, but are working on 

creating and implementing plans for installations that they believe will have 

an enduring presence. According to command officials, the development of 

the master plans depends upon the outcome of the not-yet-completed DOD 

effort to develop an Integrated Global Presence and Basing Strategy, as well 

as guidance that the Office of the Secretary of Defense (OSD) is finalizing for 

the regional commands. In March 2003, the Secretary of Defense requested 

that the Under Secretary of Defense for Policy and the Chairman, Joint 

Chiefs of Staff, develop an Integrated Global Presence and Basing Strategy 

that may change the global positioning of forces and the supporting 

infrastructure overseas. Until results of the strategy are released and OSD 

guidance is finalized, command officials are limiting their development and 

implementation of the master plans to installations that they believe will 

have an enduring presence. These plans include moving military personnel 

from near the demilitarized zone to other sites in South Korea; reducing U.S 

forces’ land use by over 12,000 acres in Okinawa, Japan; and consolidating 

13 installations into a single location near Grafenwöhr, Germany. 

Various factors can affect U.S. infrastructure costs overseas and the 

development and implementation of the overseas regional commands’ 

comprehensive master plans. These factors include cash and other cost 

burden-sharing contributions from host nations; property returns to host 

nations; the environmental remediation of property returned to host nations; 

and the receipt of residual value from host nations for returned property. 

The extent to which these factors affect costs can vary by regional command 

and by international agreements reached with host nations. Furthermore, 

overseas commands have several U.S. sources to help fund ongoing and 

future infrastructure changes, including operation and maintenance and 

contingency operations appropriations in addition to military construction 

appropriations, which includes exercise-related construction. GAO agrees 

that OSD’s preliminary guidance—directing the overseas regional commands 

to address the precise facility requirements, properties being returned to 

host nations, funding requirements, and the division of funding 

responsibilities between the United States and cognizant host nations in 

their comprehensive master plans—is appropriate. However, the extent to 

which the commands’ plans and status reports will address other factors—

such as residual property value and environmental remediation issues, and 

multiple U.S. funding sources—that are not clearly specified by 

congressional or OSD’s preliminary guidance remains unclear. Addressing 

the applicability of these factors in the development of the master plans and 

annual status reports would make them more useful to the services and 

overseas regional commands in managing U.S. military infrastructure and 

associated costs overseas, and provide Congress and OSD with more 

complete information for their oversight responsibilities. 

Since the end of the Cold War, U.S. 

military overseas presence has 

changed dramatically. The 

Department of Defense (DOD) has 

been reexamining overseas basing 

requirements, and it expects to 

make a number of changes to 

provide greater flexibility for U.S. 

forces in Western Europe and 

Northeast Asia. Concerns over the 

potential use of funds for what may 

soon be obsolete basing projects 

prompted congressional action 

directing DOD to prepare and 

submit with next year’s budget 

request comprehensive master 

plans for changing infrastructure 

requirements under each overseas 

command. GAO was also directed 

to report on the development and 

implementation of these plans. 

GAO completed an advance review 

to identify opportunities to make 

the plans more informative for 

Congress and DOD in their 

oversight responsibilities. This 

report addresses: (1) the 

development of overseas regional 

commands’ comprehensive master 

plans, and (2) the factors affecting 

U.S. infrastructure costs overseas 

and the development and 

implementation of comprehensive 

master plans. 

GAO recommends that overseas 

regional commands identify several 

specific factors, such as residual 

property value and environmental 

issues, when developing and 

reporting to Congress on their 

master plans. DOD partially 

concurred. 
Page i GAO-04-609 Defense Infrastructure 

Letter 1

Results in Brief 4

Background 10

Overseas Regional Commands Have Not Yet Begun Development 

of the Comprehensive Master Plans 14

Various Factors Can Affect Infrastructure Costs Overseas and the 

Development and Implementation of Comprehensive Master 

Plans 16

Conclusions 25

Recommendations for Executive Action 26

Agency Comments and Our Evaluation 26

Scope and Methodology 27

Appendix I GAO Briefing Slides 30 

Appendix II Comments from the Department of Defense 60 

Figure 

Figure 1: PACOM, EUCOM, and CENTCOM Geographic Areas of 

Responsibility 11

Contents 
Page ii GAO-04-609 Defense Infrastructure 

Abbreviations 

AAFES Army and Air Force Exchange Service 

CENTCOM Central Command 

DOD Department of Defense 

EUCOM European Command 

NATO North Atlantic Treaty Organization 

OSD Office of the Secretary of Defense 

PACOM Pacific Command 

SOCOM Special Operations Command 

USFK United States Forces Korea 

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Page 1 GAO-04-609 Defense Infrastructure 

July 15, 2004 

Congressional Committees 

Since the end of the Cold War and the fall of the Berlin Wall in 1989, U.S. 

military overseas presence has changed dramatically. Force structure has 

been reduced in some commands, and the number of overseas military 

installations has decreased. The U.S. European Command alone has 

closed about 560 installations over the last decade. New threats, new 

deployment concepts, and geopolitical realities have emerged, yet much of 

the Department of Defense’s (DOD) overseas infrastructure—installations 

and facilities used to support U.S. forces overseas—remains organized 

around Cold War strategic concepts. Consequently, in recent years the 

department has been examining the potential for additional changes in 

overseas basing. In September 2001, DOD issued the Quadrennial Defense 

Review Report,

1

 which indicated the need to reorient U.S. global military 

posture to develop a basing system that provides greater flexibility for U.S. 

forces in critical areas of the world, placing emphasis on additional bases 

and stations in Western Europe and Northeast Asia. Subsequently, DOD 

initiated several basing studies including the Overseas Basing and 

Requirements Study, the Overseas Presence Study, and the U.S. Global 

Posture Study, as well as initiating some recent changes. For example, as 

we previously reported, U.S. military officials and the Republic of Korea 

(hereafter referred to as South Korea) entered into an agreement2

 in March 

2002 to reduce the number of U.S. installations from 41 to 23 and provide 

new infrastructure and facilities funded primarily by the Government of 

South Korea.3

 The initial Land Partnership Plan was predicated on 

continuing to maintain U.S. bases and facilities north of Seoul (near the 

demilitarized zone that separates North Korea and South Korea). However, 

 1

 U.S. Department of Defense, Quadrennial Defense Review Report (Washington, D.C.: 

Sept. 30, 2001). 

2

 The agreement, known as the Land Partnership Plan, is a cooperative U.S. and South 

Korean effort to consolidate U.S. military installations and training areas, improve combat 

readiness, enhance public safety, and strengthen the U.S.-South Korean alliance by 

addressing some of the causes of periodic tension and discontent among South Koreans 

regarding the U.S. presence in South Korea. 

3

 U.S. General Accounting Office, Defense Infrastructure: Basing Uncertainties 

Necessitate Reevaluation of U.S. Construction Plans in South Korea, GAO-03-643

(Washington, D.C.: July 15, 2003). 

United States Government Accountability Office

Washington, DC 20548 
Page 2 GAO-04-609 Defense Infrastructure 

changing conditions caused significant revisions to that plan before its 

implementation, including new plans to reposition U.S. forces from areas 

north, to south of Seoul. In March 2003, the Secretary of Defense 

requested that the Under Secretary of Defense for Policy and the 

Chairman, Joint Chiefs of Staff, pull together existing studies and develop 

an Integrated Global Presence and Basing Strategy that may result in the 

global repositioning of U.S. forces and the supporting infrastructure 

overseas. The results of this effort may cause additional changes affecting 

U.S. basing in South Korea, Europe, and other locations overseas. The full 

results of these studies and related negotiations may not be available for 

several months; consequently, sufficient information is not currently 

available to determine the full magnitude of modifications to existing 

basing arrangements that will be required. 

For several years, the Senate Appropriations Committee has expressed 

concern that the overseas basing structure has not been updated to reflect 

the new realities of the post-Cold War world.4

 The Committee also 

expressed concern about the use of military construction budget authority 

for projects at bases that may soon be obsolete due to changes being 

considered in overseas presence and basing. Consequently, the conference 

report5

 accompanying the fiscal year 2004 military construction 

appropriation bill directed DOD6

 to prepare detailed comprehensive 

master plans for overseas infrastructure requirements for U.S. military 

facilities7

 and provide a baseline report with the fiscal year 2006 military 

construction budget submission and annual reports on the status of those 

plans and their implementation with each military construction budget 

submission through fiscal year 2009—usually in February each year. In 

addition, a Senate report8

 accompanying the fiscal year 2004 military 

 4

 S. Rep. No. 108-82, at 10 (2003). 

5

 H.R. Conf. Rep. No. 108-342, at 17 (2003). 

6

 Although not specifically requested in the conference report, the Office of the Secretary of 

Defense has asked the overseas regional commands to prepare comprehensive master 

plans for their areas of responsibility. 

7

 For the purposes of this report, we focused our analysis on the activities of U.S. Forces 

Korea, Pacific Command, European Command, and Central Command. We were also 

requested to review Special Operations Command. We did not include Northern Command 

or Southern Command in our analysis because these commands have significantly fewer 

facilities overseas than the other regional commands in the Pacific, Europe, and Central 

Asia. 

8

 S. Rep. No. 108-82, at 13-14 (2003). 
Page 3 GAO-04-609 Defense Infrastructure 

construction appropriation bill requires the plans to identify precise 

facility requirements, the status of properties being returned to host 

nations, and the funding requirements as well as the division of funding 

responsibilities between the United States and cognizant host nations. 

The Senate report also directed us to monitor the comprehensive master 

plans being developed and implemented for the overseas regional 

commands and to provide the congressional defense committees with an 

assessment report by May 15 of each year through fiscal year 2008. Our 

reports are to include an assessment of the status of the plans; the 

associated costs; host-nation burden-sharing9

 implications; and other 

relevant information involving property returns to host nations, including 

residual values and environmental remediation issues.10 As requested, we 

completed an advance review to identify opportunities to make the plans 

more informative for Congress and DOD in their oversight responsibilities. 

We recently provided your offices with information summarizing our 

preliminary observations in a briefing format (see app. I). This report 

summarizes and updates our observations contained in the briefing 

materials in the following two areas: (1) the status of development of 

overseas regional commands’ comprehensive master plans and (2) an 

assessment of factors—such as burden-sharing implications, planned 

property returns, residual property values, environmental remediation 

issues, and the associated U.S.-funded costs—that can affect U.S. 

infrastructure costs overseas, the development and implementation of 

comprehensive master plans, and how these factors can vary by individual 

overseas regional command. 

To address our objectives, we obtained information from overseas 

regional commands—U.S. Forces Korea (USFK) and U.S. Forces Japan 

within the Pacific Command (PACOM) area of responsibility, European 

Command (EUCOM), Central Command (CENTCOM), and Special 

Operations Command (SOCOM)—to identify the status of their 

comprehensive master plans, including associated U.S.-funded costs the 

commands may incur, burden-sharing implications, property returns to 

 9

 “Burden-sharing” refers to cash and other contributions that the host-nation government 

provides to support U.S. troops in the host nation. 

10 Residual value is the negotiated dollar value of U.S.-constructed or improved facilities 

that are turned over to host nations. DOD policy is to obtain the maximum residual value 

permissible. Often, actual or anticipated environmental remediation costs incurred by the 

host nation for DOD-caused contamination may be offset against the residual value of the 

facilities turned over to the host nation. 
Page 4 GAO-04-609 Defense Infrastructure 

host nations, environmental remediation issues, and residual value 

available from property returns to host nations. We also met with officials 

of the Office of Secretary of Defense (OSD) to determine the guidance and 

criteria provided to overseas regional commands for the development of 

comprehensive master plans. Through our review of the data, examination 

of specific data elements, and discussions with DOD officials, we believe 

the data gathered are sufficiently reliable for the purposes of this report, 

except for data generated by CENTCOM. Because of ongoing operations, 

we were not able to meet with CENTCOM officials to discuss the 

development of comprehensive master plans, factors that can affect U.S. 

costs or data reliability. However, we obtained written responses to 

questions on overseas presence and basing, U.S.-associated costs, burdensharing implications, property returns to host nations, potential U.S. 

liability for environmental remediation, and residual value likely for 

property returns to host nations. 

We conducted our work from November 2003 through April 2004 in 

accordance with generally accepted government auditing standards. 

Details about our scope and methodology appear at the end of this report. 

At the time of our review, overseas regional commands had not yet begun 

to develop comprehensive master plans that, consistent with the 

conference report, are due with the fiscal year 2006 budget submission. 

While overseas regional commands are awaiting decisions on the 

Integrated Global Presence and Basing Strategy and receipt of OSD final 

guidance for developing detailed comprehensive master plans, they have 

been working with OSD on the Integrated Global Presence and Basing 

Strategy and developing and implementing plans for installations they 

believe will have an enduring presence11 in future years (see app. I, slide 

9). According to command officials, development of the master plans is 

dependent upon the completion of the ongoing Integrated Global Presence 

and Basing Strategy. In addition, OSD is finalizing guidance for the 

overseas regional commands to use in developing these master plans, 

including a template to ensure consistency across commands, to be issued 

later this year. OSD has provided preliminary guidance to the overseas 

regional commands that specifies that plans must identify precise facility 

requirements, funding requirements, the division of funding 

 11 “Enduring presence” refers to installations the overseas commanders consider vital to 

the execution of their mission and worthy of regular funding and improvement. 

Results in Brief 
Page 5 GAO-04-609 Defense Infrastructure 

responsibilities between the United States and host nations, and the status 

of properties being returned to host nations—the same requirements 

outlined in the Senate report accompanying the fiscal year 2004 military 

construction appropriation bill. Until the global basing strategy is released 

and the guidance is finalized, the overseas regional commands cannot 

complete their comprehensive master plans and are continuing to develop 

and implement plans for installations they believe will have an enduring 

presence. For example, USFK has developed a plan to consolidate forces 

currently located near the demilitarized zone to Camp Humphreys south of 

Seoul,12 and EUCOM has a plan to consolidate 13 Army installations into 

one near Grafenwöhr, Germany. 

In addition to the results of the Integrated Global Presence and Basing 

Strategy, various factors can affect U.S. infrastructure costs overseas and 

the development and implementation of the overseas regional commands’ 

comprehensive master plans—factors that can vary significantly by 

individual overseas regional command and by agreements with host 

nations. Several of these factors depend largely on the economic 

conditions and political environment in host nations that can decrease 

host nations’ overall support to U.S. forces and increase U.S.-funded costs 

for future infrastructure changes. These factors include the following: 

• Burden-sharing contributions from host nations. The extent to which 

overseas regional commands and their component commands13 rely on 

direct or indirect burden-sharing contributions14 from host nations varies 

by country and can affect the amount of military construction funding 

requested by overseas commands (see app. I, slides 11 and 12). The 

amount of host-nation funding has varied by agreement with individual 

host nations in the past and can be subject to changing economic 

 12 United States Forces Korea, Camp Humphreys, Korea, Real Property Master Plan 

Future Development Framework (Mar. 2004). 

13 “Component commands” refers to the military services (i.e., the Army, the Navy, the 

Marine Corps, and the Air Force) that support the overseas regional commands. 

14 Direct contributions consist of cash payments for U.S. stationing costs to be used at the 

discretion of overseas regional commands and their components, including cash for 

renovation and construction of facilities. Indirect contributions are noncash 

contributions—often land and facilities provided free of charge by the host nation—as well 

as the host-nation sharing expenses, such as administration, planning, design, and 

associated overhead for construction, maintenance, and repair of new or existing facilities. 

Other examples of indirect contributions include cost avoidance or waivers of taxes, fees, 

and rents, and host nation-funded labor support. 
Page 6 GAO-04-609 Defense Infrastructure 

conditions. Historically, little or no U.S. military construction funding was 

needed in Japan, although the Government of Japan is expected to reduce 

its contribution level because of recent budgetary concerns. In addition, 

the extent to which host-nation funding would be available to support new 

basing requirements in any countries not currently hosting U.S. forces 

remains to be seen. 

• Property returns to host nations. Property returns are expected to be an 

integral part of future overseas basing changes and, depending on the 

circumstances, may or may not require replacement facilities overseas 

(see app. I, slide 13). For example, overseas regional commands have 

agreed to significant property returns to host-nation governments in South 

Korea, Japan, and Europe in response to force structure changes, new 

threats, and political and diplomatic considerations. For example, USFK 

plans to return 31 installations to the Government of South Korea, and U.S. 

forces in Japan plan to return over 12,000 acres of land to the Government 

of Japan. Also, EUCOM has closed over 560 installations and returned the 

property and facilities to host nations over the last decade. However, as a 

result of potential changes in overseas basing identified in the ongoing 

Integrated Global Presence and Basing Strategy, more or less property 

may be returned to host-nation governments. 

• Receipt of residual value for returned property. The extent to which 

overseas regional commands and their component commands obtain 

residual value for properties returned to each host nation varies by status 

of forces agreements and other agreements between the U.S. and the host 

nation. This can affect the amount of military construction funding 

requested by overseas commands (see app. I, slides 16 and 17). In 

PACOM’s area of responsibility, there is no need for international 

agreements to provide for residual value, because host nations provide 

replacement facilities. For instance, the South Korean government is 

expecting to sell property returned by USFK to raise capital to help 

finance the cost of moving U.S. forces south of Seoul. In EUCOM, 

international agreements have resulted in the receipt of approximately 

$175 million for property returned to nine countries since the early 1990s. 

Arrangements vary by country in CENTCOM, where six host nations have 

agreements to allow for residual value negotiations and nine countries 

have no such agreements. However, the amount of residual value the 

commands can expect to obtain in the future depends on how the host 

nation views the value of the returned property. Because of economically 

depressed markets—such as some countries within the EUCOM area of 

responsibility—coupled with reduced defense spending by some host 

nations and closure of their own military facilities, the market for property 
Page 7 GAO-04-609 Defense Infrastructure 

from closed U.S. military installations has dwindled, resulting in little, if 

any, residual value for returned properties. 

• Returned property environmental remediation. The extent to which 

overseas regional commands and their component commands incur costs 

for environmental remediation as a result of these property returns has 

varied by country, depending on agreements with individual host nations, 

and can affect U.S. infrastructure costs overseas (see app. I, slides 14 and 

15). Historically, overseas regional commands have incurred limited costs 

for environmental remediation as a result of these property returns. For 

example, the component commands in South Korea and Japan have 

incurred limited costs to date, while EUCOM currently estimates its 

potential costs for environmental remediation at about $90 million, 

regardless of whether the property is returned in the future. However, in 

the future, there is less certainty regarding potential costs for 

environmental remediation because these issues are becoming an 

increasing concern in South Korea and Japan. For example, according to 

PACOM officials, South Korea has established procedures for addressing 

environmental remediation, and the Government of Japan is enacting 

more stringent environmental laws. 

• Multiple U.S. funding sources available to support future infrastructure 

changes. The level of U.S. funding required for overseas infrastructure 

costs varies by country-specific factors and can affect the development 

and implementation of comprehensive master plans (see app. I, slide 10). 

Overseas regional commands and their component commands historically 

have relied on funding through multiple U.S. organizations to pay for the 

costs associated with the planned infrastructure changes.15 In addition to 

military construction appropriations,16 these funding sources include 

operation and maintenance17 and contingency operations appropriations to 

 15 However, not all future infrastructure changes are yet known. Until the Integrated Global 

Presence and Basing Strategy is completed, the overseas regional commands will remain 

uncertain of all future infrastructure changes. Also, without the approval and identification 

of all future infrastructure changes, the overseas regional commands will remain unable to 

identify all associated costs. 

16 Military construction, as defined in 10 U.S.C. §2801 (2003) “includes any construction, 

development, conversion, or extension of any kind carried out with respect to a military 

installation.” 

17 As defined in 10 U.S.C. §2805 (2003), operation and maintenance appropriations may be 

used for unspecified minor military construction projects costing no more than $1.5 million 

and intended solely to correct a deficiency that is life-threatening, health-threatening, or 

safety-threatening, or $750,000 for any other unspecified minor military construction 

project. 
Page 8 GAO-04-609 Defense Infrastructure 

fund ongoing and future infrastructure changes. Also, under Title 10 

United States Code Section 2805, exercise-related construction authority is 

available for construction projects outside the United States of not more 

than $5 million as directed by the Joint Chiefs of Staff. For example, 

EUCOM uses exercise-related construction authority, generally in small 

amounts, for training exercises—such as constructing a refueling facility 

in Tunisia. CENTCOM has used operation and maintenance funds through 

its contractors, as well as military construction funds, to finance facility 

requirements for ongoing operations. The commands also have 

nonappropriated funds, such as Army and Air Force Exchange Service 

funding sources, to fund the construction of military exchange stores. 

Other funding sources include the DOD Medical Command, the Defense 

Logistics Agency, and the Defense Commissary Agency. However, given 

current budget constraints and other defense priorities, the ability of the 

overseas regional commands and their component commands to obtain 

the required U.S. funding levels for future infrastructure changes overseas 

may change. 

We agree that OSD’s preliminary guidance—directing overseas regional 

commands to address the precise facility requirements, properties being 

returned to host nations, funding requirements, and the division of funding 

responsibilities between the United States and cognizant host nations in 

their comprehensive master plans—is appropriate. However, the extent to 

which the commands’ plans will address the applicability of other 

factors—such as residual property value and environmental remediation 

issues, and multiple U.S. funding sources—that are not clearly specified in 

OSD’s preliminary guidance remains unclear. Without descriptions of the 

extent to which residual value issues are likely to be applied to properties 

returned to each host nation and offset environmental remediation costs, 

the comprehensive master plans and the required periodic reporting on 

the status of their implementation may not fully identify all the expected 

capital available to help finance the cost of moving and consolidating U.S. 

forces overseas and improving their facilities. Also, without identification 

of potential multiple U.S. funding sources that may be available to support 

future infrastructure changes, the comprehensive master plans and status 

reports might not fully identify the extent to which overseas regional 

commands and their component commands plan to rely on these funding 

sources compared to host-nation contributions. Addressing the 

applicability of these additional factors in DOD’s development of its 

master plans and the required periodic status reports would make them 

more useful as tools to the services and overseas regional commands in 

managing U.S. military infrastructure and associated costs overseas, and 
Page 9 GAO-04-609 Defense Infrastructure 

provide Congress and OSD with more complete information for their 

oversight responsibilities. 

To make future comprehensive master plans and periodic reporting to 

Congress on their implementation more useful in managing U.S. military 

infrastructure and associated costs and more informative for Congress and 

OSD in their oversight responsibilities, we are recommending that in 

developing their master plans overseas regional commands address the 

extent to which implementation of their plans could be affected by 

residual property value and environmental remediation issues, as well as 

multiple U.S. funding sources available to support future infrastructure 

changes and include this information in their comprehensive master plans. 

We are also recommending that they provide updated information on 

these factors in their annual status reports to Congress on the master 

plans. In comments on a draft of this report, DOD concurred that future 

comprehensive master plans should address environmental issues, but did 

not concur that master plans should include assessments of residual value 

or multiple funding sources. According to DOD, residual value is obtained 

through negotiations and cannot be predicted and therefore should not be 

assumed in a master plan. Likewise, master plans should not include 

multiple funding sources because military construction projects that 

would be eligible for these alternate funding sources are subject to funding 

thresholds. While we acknowledge the uncertainties of obtaining residual 

value for returned property and thresholds for multiple funding sources, 

we believe overseas regional commands should identify residual property 

value issues as they evolve, as well as identify multiple U.S. funding 

sources that may be available in their master plans and annual status 

reports to Congress. While our recommendations as originally written 

could have been interpreted as being applicable only to the commands’ 

master plans, we have modified our recommendations to include 

addressing these factors in their annual status reports to Congress as well 

as in the master plans. We also modified our language to better recognize 

that complete information on these factors is likely to evolve over time. 

The department also provided technical comments, which we 

incorporated as appropriate. 
Page 10 GAO-04-609 Defense Infrastructure 

Military construction appropriations fund the planning, design, 

construction, alteration, and improvement of military facilities worldwide. 

As of fiscal year 2003, DOD had over 6,000 installations total, with 702 

installations located overseas. Operational control of the U.S. combat 

forces and installations is assigned to the nation’s five geographic unified 

combatant commands, which are responsible for the security environment 

as directed by the national security and military strategies. Composed of 

forces from two or more services, PACOM, EUCOM, and CENTCOM span 

numerous countries and even continents and encompass areas with 

economically, politically, and socially diverse regions. (See fig. 1.) 

Background 
Page 11 GAO-04-609 Defense Infrastructure 

Figure 1: PACOM, EUCOM, and CENTCOM Geographic Areas of Responsibility 

Note: SOCOM does not have a specific geographic area of responsibility because it is a functional 

combatant command with responsibility for waging war on terrorism. SOCOM also provides special 

operations forces to support the geographic combatant commanders’ security plans. SOCOM is a 

tenant unit on bases and funds special operations forces-specific items—such as hangers for 

aircraft—out of military construction appropriations, and uses operation and maintenance 

appropriations for support items, such as special-operations-specific computers. 

Map does not show Hawaii or Alaska within PACOM’s area of responsibility. 

The United States has a large portion of its military personnel deployed 

abroad at any given time; however, this number varies with the frequency 

and types of military operations and deployment demands. Currently, 

slightly more than 100,000 troops are stationed in Europe. Most of these 

are U.S. Army forces stationed mainly in Germany, with smaller numbers 

elsewhere in Europe and some in Africa. Nearly 100,000 military personnel 

are located in East Asia, divided between Japan, South Korea, and on the 

Source: GAO generated map based on DOD data.

EUCOM

PACOM

CENTCOM

Arctic

Ocean

Atlantic

Ocean

Indian

Ocean

Pacific

Ocean
Page 12 GAO-04-609 Defense Infrastructure 

waters of the Pacific. Additionally, the ongoing global war on terrorism 

has resulted in the deployment of much larger numbers of troops in 

theaters of operation in Iraq and Afghanistan. 

In September 2001, DOD issued the Quadrennial Defense Review Report, 

which addressed, among other issues, reorienting the U.S. military global 

posture. During the latter half of the 20th century, the United States 

developed a global system of overseas military bases primarily to contain 

aggression by the Soviet Union. U.S. presence is aligned closely with U.S. 

interests and likely threats to those interests (i.e., Western Europe and 

Northeast Asia). In recent years, DOD has been undergoing a 

transformation to meet changing global threats and focus on a defense 

strategy and force structure to keep the peace and defend freedom in the 

21st century. The Quadrennial Defense Review Report called for 

developing a basing system that provides greater flexibility for U.S. forces 

in critical areas of the world, placing emphasis on additional bases and 

stations in Western Europe and Northeast Asia, and providing temporary 

access to facilities in foreign countries that enable U.S. forces to conduct 

training and exercises in the absence of permanent ranges and bases. 

In March 2002, military officials from the United States and the 

Government of South Korea entered into an agreement, known as the 

Land Partnership Plan, to consolidate U.S. installations and training areas, 

improve combat readiness, enhance public safety, and strengthen the U.S.-

South Korean alliance. In July 2003, we reported that the ongoing 

reassessments of U.S. overseas presence and basing requirements could 

diminish the need for and alter the locations of many construction projects 

in South Korea, including those associated with the Land Partnership Plan 

and those unrelated to it.18 We also identified some key challenges that 

could adversely affect the implementation of the plan and future U.S. 

military construction projects throughout South Korea. First, the Land 

Partnership Plan would rely on various funding sources, including funding 

realized through land sales from property returned by the United States. 

The extent to which these sources of funding would be required and 

available for broader infrastructure changes is not yet clear. Second, a 

master plan would be needed to guide future military construction to 

reposition U.S. forces and basing in South Korea. Subsequent to the 

original Land Partnership Plan, DOD initiated the Integrated Global 

Presence and Basing Strategy that builds upon multiple DOD studies, 

 18 See GAO-03-643. 
Page 13 GAO-04-609 Defense Infrastructure 

including the Overseas Basing and Requirements Study, the Overseas 

Presence Study, and the U.S. Global Posture Study. The completion of the 

Integrated Global Presence and Basing Strategy will likely change the 

number and locations of U.S. military bases in South Korea and in other 

overseas commands. 

For several years, the Senate Appropriations Committee has expressed 

concern that the overseas basing structure has not been updated to reflect 

the new realities of the post-Cold War world. The committee also 

expressed concern about the use of military construction budget authority 

for projects at bases that may soon be obsolete due to changes being 

considered in overseas presence and basing. Consequently, in the Senate 

report accompanying the fiscal year 2004 military construction 

appropriation bill, the Senate Appropriations Committee directed DOD to 

prepare comprehensive master plans for the changing infrastructure 

requirements for U.S. military facilities in each of its overseas regional 

commands. Subsequently, similar action was directed by the conference 

report accompanying the 2004 military construction appropriation bill. 

Within the department, the Under Secretary of Defense for Acquisition, 

Technology and Logistics has been tasked to respond to this legislative 

requirement; in turn, he has asked the overseas regional commands to 

prepare detailed comprehensive master plans for their area of 

responsibility. At a minimum, under the Senate Appropriations Committee 

mandate, the plans are to identify precise facility requirements, status of 

properties being returned to host nations, and funding requirements and 

the division of funding responsibilities between the United States and 

cognizant host nations. The conference report also required DOD to 

provide a report on the status and implementation of those plans with 

each yearly military construction budget submission through fiscal year 

2009. 

The Senate Appropriations Committee also directed GAO to monitor the 

comprehensive master plans being developed and implemented for the 

overseas regional commands and to provide the congressional defense 

committees with a report by May 15 of each year giving an assessment of 

the status of the plans; associated costs; burden-sharing implications; and 

other relevant information involving property returns to host nations, 

including environmental remediation issues and residual values. 

Congressional 

Requirement for Detailed 

Comprehensive Master 

Plans 
Page 14 GAO-04-609 Defense Infrastructure 

At the time of our review, the overseas regional commands had not yet 

begun development of the comprehensive master plans, which are due 

with the fiscal year 2006 budget submission. Master plans are dependent 

upon the outcome of the not-yet-completed DOD Integrated Global 

Presence and Basing Strategy. While awaiting decisions on the Integrated 

Global Presence and Basing Strategy, the overseas regional commands 

have been working with OSD to implement plans for enduring installations 

in accordance with the global basing strategy. In addition, OSD is finalizing 

guidance for the commands to use in developing these master plans, 

including a template to ensure consistency across commands, that it 

expects to issue later this year. In February 2004, OSD provided 

preliminary guidance to the overseas regional commands that specified 

that plans must identify (1) precise facility requirements, (2) funding 

requirements, (3) the division of funding responsibilities between the 

United States and host nations, and (4) the status of properties being 

returned to host nations. In addition, OSD provided a proposed format for 

the master plans, which is still under review by the department. Until the 

Integrated Global Presence and Basing Strategy is released and OSD’s 

guidance is finalized, the overseas regional commands have limited efforts 

under way to address the requirement for comprehensive plans. 

At the same time, overseas regional commands and their component 

commands are continuing to develop and implement plans for facilities 

they believe will have an enduring presence. For example: 

• USFK has an ongoing initiative to move military personnel located near 

the demilitarized zone to Camp Humphreys, South Korea (see app. I, slide 

21). This initiative will reduce major installations from 41 down to 10 and 

provide new infrastructure and facilities funded primarily by the 

Government of South Korea, pending ratification by the South Korean 

National Assembly and completion of the Future of the Alliance talks.19

Under a unique self-funding strategy, USFK will return 31 major 

installations, which will enable the Government of South Korea to sell land 

and fund the relocation and construction of new facilities at Camp 

Humphreys. In addition, USFK is studying options for relocating the units 

stationed at Yongsan Army Garrison in Seoul; however, specific timelines 

 19 In December 2002, the U.S. Secretary of Defense and the Defense Minister of South 

Korea agreed to conduct a Future of the Alliance study to assess the roles, missions, 

capabilities, force structure, and stationing of U.S. forces, including having South Korea 

assume the predominant role in its defense and increasing both South Korean and U.S. 

involvement in regional security cooperation. 

Overseas Regional 

Commands Have Not 

Yet Begun 

Development of the 

Comprehensive 

Master Plans 
Page 15 GAO-04-609 Defense Infrastructure 

have not been finalized. Two enduring installations being considered for 

these units are Osan Air Force Base and Camp Humphreys. 

• U.S. Forces Japan has an ongoing initiative to return over 12,000 acres of 

land to reduce land use by U.S. forces in Okinawa under The Special 

Action Committee on Okinawa Final Report20 (see app. I, slide 24).21 In 

exchange for this land, the Government of Japan will fund relocation of 

housing, communication sites, training areas, a hospital, the Marine Corps 

Air Station Futenma, and land at the Naha Port, in addition to other 

support facilities. The estimated cost of relocating the Air Station Futenma 

is more than $3 billion. 

• The U.S. Army Europe has an ongoing initiative—Efficient Basing 

Grafenwöhr—to consolidate 13 installations into one single location near 

Grafenwöhr, Germany (see app. I, slide 26). Efficient Basing Grafenwöhr is 

an initiative to enhance readiness, gain efficiencies, and improve the well 

being of approximately 3,500 soldiers and 5,000 family members. 

According to EUCOM officials, this initiative will facilitate command and 

control, lower transportation costs, enable better force protection, 

improve access to training areas, eliminate over 5 million square feet of 

excess inventory, and reduce base operations costs by up to an estimated 

$19 million per year. In addition, U.S. Navy Europe is moving its 

headquarters south, from London in the United Kingdom, and 

consolidating with three subordinate staffs at Naval Support Activity 

Naples, Italy, to reduce costs while increasing operational effectiveness 

(see app. I, slide 27). The Navy is also planning several different initiatives 

to consolidate missions in the Mediterranean and downsize Naval Air 

Station Keflavik in Iceland. U.S. Air Force Europe has an ongoing 

transition from Rhein-Main Air Base, Germany, to Ramstein and 

Spangdahlem bases, which is funded by various sources, including the 

North Atlantic Treaty Organization (NATO) and the Government of 

Germany (see app. I, slide 28). U.S. Air Force Europe received a reported 

$62.5 million for the return of some land based on an agreement signed in 

1993 and is receiving an additional $425 million as a result of an agreement 

signed in 1999 for complete closure of Rhein-Main Air Base. 

 20 The Ministry of Foreign Affairs of Japan, The Special Action Committee on Okinawa 

Final Report (Dec. 2, 1996). 

21 In addition to the land return initiatives, The Special Action Committee on Okinawa 

Final Report includes 16 initiatives in the areas of noise reduction, operations and training, 

and Status of Forces Agreements procedures. 
Page 16 GAO-04-609 Defense Infrastructure 

Various factors can affect U.S. infrastructure costs overseas and the 

development and implementation of the overseas regional commands’ 

comprehensive master plans. The extent of their effect can vary by 

regional command as well as host-nation agreement. Several of these 

factors depend largely on the economic conditions and political 

environment in host nations that can decrease host nations’ overall 

support to U.S. forces and increase U.S.-funded costs for future 

infrastructure changes. The level of burden-sharing contributions provided 

by host nations can affect the amount of military construction funding 

requested by overseas commands. In different instances, property returns 

may or may not require replacement facilities overseas, and the residual 

value that the United States receives from property returned to host 

nations varies by country and also can affect U.S.-funded infrastructure 

costs. Additionally, the United States could potentially incur costs for 

environmental remediation of returned property before the host-nation 

government will accept it. In addition to host-nation funding, overseas 

commands have multiple U.S. funding sources to support future 

infrastructure changes. As noted earlier, we agree that OSD’s preliminary 

guidance—directing overseas regional commands to address the precise 

facility requirements, properties being returned to host nations, funding 

requirements, and the division of funding responsibilities between the 

United States and cognizant host nations in their comprehensive master 

plans—is appropriate. However, the extent to which the other relevant 

factors discussed previously will be addressed in these plans and the 

required periodic reporting on their implementation is not yet clear. More 

specifically, neither the Senate report nor OSD’s preliminary guidance 

requires the plans to address residual property value and environmental 

remediation issues, or multiple U.S. funding sources compared to available 

host-nation funding for future infrastructure changes. Addressing the 

applicability of these factors would make the comprehensive master plans 

and periodic status reports on their implementation more useful as tools in 

managing U.S. military infrastructure and associated U.S.-funded costs, 

and provide Congress and OSD with more complete information for their 

oversight responsibilities. 

Commands benefit from burden-sharing contributions provided by host 

nations, which in turn can reduce the commands’ need for military 

construction appropriations (see app. I, slides 11-12). The extent to which 

overseas regional commands and their component commands rely on 

burden-sharing contributions from host nations varies by country and 

directly affects U.S. infrastructure costs overseas and the development 

and implementation of comprehensive master plans. Historically, overseas 

Various Factors Can 

Affect Infrastructure 

Costs Overseas and 

the Development and 

Implementation of 

Comprehensive 

Master Plans 

Overseas Regional 

Commands Benefit from 

Burden-Sharing 

Contributions 
Page 17 GAO-04-609 Defense Infrastructure 

regional commands have relied on both types of contributions—direct and 

indirect burden sharing. For example, two countries in PACOM’s area of 

responsibility—South Korea and Japan—provide about 73 percent of the 

total worldwide burden-sharing contributions to support U.S. troops, while 

countries within EUCOM’s area of responsibility provide about 21 percent 

of total burden-sharing contributions worldwide. In CENTCOM’s area of 

responsibility, countries only fund about 6 percent of U.S. contributions 

worldwide.22 However, the extent to which this will continue is uncertain 

because the level of contributions from some host-nation governments 

may change in the future. 

According to USFK officials, under the terms of the 2002-04 Special 

Measures Agreement, South Korea provides logistics, labor support, and 

host nation-funded construction valued at about $593 million for fiscal 

year 2004. Two programs that provide host nation-funded construction are 

the Combined Defense Improvement Projects and Republic of Korea 

Funded Construction. Under the Combined Defense Improvement 

Projects Program, South Korea supports facility requirements that are 

directly related to the combined U.S. and South Korean warfighting 

capabilities. The Republic of Korea Funded Construction Program is a 

cash contribution program where funds are transferred to the U.S. 

government for quality of life infrastructure, as well as warfighting 

facilities. This program is restricted from funding clubs, golf courses, 

theaters, and bowling alleys. In addition to the Special Measures 

Agreement, USFK expects the Government of South Korea to provide 

funds to replace facilities and land for the amended Land Partnership Plan 

before it relocates troops stationed near the demilitarized zone to the 

south at Camp Humphreys. Also, USFK expects the Government of South 

Korea to provide funds to relocate and replace facilities and land before it 

moves its personnel from the Yongsan Army Garrison to south of Seoul. 

Both of the planned troop relocations are not yet approved by the 

Government of South Korea and are pending approval through a vote by 

the South Korean National Assembly. 

U.S. Forces Japan, within PACOM’s area of responsibility, and the 

Government of Japan have three burden-sharing programs that provide 

support to U.S. military personnel stationed there. First, according to 

PACOM officials, the Special Measures Agreement provides financial 

 22 U.S. Department of Defense, Allied Contributions to the Common Defense (Washington, 

D.C.: July 2003). Data are from calendar year 2002. 
Page 18 GAO-04-609 Defense Infrastructure 

support for labor (salaries for Japanese nationals working on U.S. bases), 

utilities (electricity, gas, water, sewage, and heating fuels), and rent. 

Second, the Japan Facilities Improvement Program provides in-kind 

construction support,23 such as family housing and other service initiatives. 

The type of facility projects that cannot be supported are religious 

facilities, additional fuel and munitions storage, chemical and biological 

protection, facilities that Japan’s government considered luxuries (i.e., 

bowling centers and golf courses), and some types of maintenance and 

repair services or facilities identified in the Status of Forces Agreement. 

Third, the Special Action Committee on Okinawa will fund replacement 

facilities when U.S. forces return over 12,000 acres of land in Okinawa, 

including the Marine Corps Air Station Futenma and land at the Naha Port. 

The Japanese relocation funding process is another source of host-nation 

support, separate and distinct from the above two programs. Japanesefunded relocation projects are provided on a quid pro quo basis; that is, 

the projects are provided in exchange for something else (e.g., returned 

land). While the relocation program is also a Government of Japan 

initiative to reduce U.S. presence on Okinawa and strengthen the U.S.-

Japanese alliance, its funding is voluntary. In addition, according to 

PACOM officials, the relocation funding process in Japan requires 

municipal approvals at both the returned and acquired locations. 

In EUCOM’s area of responsibility, many European countries provide 

various types of host-nation support. For example, during calendar year 

2001, Germany and Italy provided the largest contributions—a reported 

$862 million and $324 million, respectively. In addition, the NATO Security 

Investment Program—which is dependent upon the diplomatically agreed 

upon financial contributions of member nations—provides funds for the 

construction of military facilities, upgrade and restoration of military 

facilities, acquisition of common-use systems and equipment, and other 

related programs and projects required by NATO to carry out its mission 

requirements. According to EUCOM officials, it is their policy for 

construction managers at all levels to review construction projects for 

NATO eligibility before committing U.S. funds. The program does not fund 

personnel support facilities such as barracks, family housing, or 

gymnasiums, all of which are considered the responsibility of individual 

member nations. Exceptions have been made to this policy to meet 

 23 In lieu of cash payments, a country may choose payment-in-kind—such as construction 

of facilities for U.S. forces provided by the host nation—which, in turn, reduces U.S. 

expenditures. 
Page 19 GAO-04-609 Defense Infrastructure 

specific U.S. needs at Aviano Air Base, Italy. For example, since 1995, the 

program has provided a reported $195 million to upgrade support facilities 

at Aviano Air Base, Italy, to include providing a hospital, school, theater, 

post office, commissary, exchange, and child development centers. 

However, the extent to which contributions will continue is uncertain 

because of the economically constrained markets in some NATO 

countries, coupled with reduced defense spending by some host nations. 

In CENTCOM’s area of responsibility, there are fewer burden-sharing 

contributions from host nations compared to EUCOM and PACOM. For 

example, prior to fiscal year 1999, the Kingdom of Saudi Arabia provided 

facility and assistance-in-kind support. However, according to CENTCOM 

officials, Saudi Arabia no longer provides any support. Currently, Qatar, 

Kuwait, and the United Arab Emirates either verbally or by signing an 

agreement have provided an estimated $534 million in support of U.S. 

facilities for fiscal year 1999 through the second quarter of fiscal year 2004. 

However, the extent to which such contributions may continue in the 

future is unknown and varies because of changing regional alliance 

considerations. 

Property returns are expected to be an integral part of future overseas 

basing changes and, depending on the circumstances, may or may not 

require replacement facilities overseas. Over the past decade, overseas 

regional commands and their component commands have agreed to 

significant property returns to host-nation governments in South Korea, 

Japan, and Europe in response to force structure changes, new threats, 

and political and diplomatic considerations (see app. I, slide 13). However, 

the ongoing Integrated Global Presence and Basing Strategy may provide 

more changes in overseas basing that could result in additional property 

being returned to host-nation governments which, in turn, could affect 

future infrastructure requirements. 

In South Korea, USFK has two initiatives that will result in property being 

returned to the host nation (see app I, slides 18-22). First, as part of the 

amended Land Partnership Plan and U.S. plans to relocate troops from 

near the demilitarized zone to Camp Humphreys, USFK will reduce the 

number of major installations in South Korea from 41 down to 10. The 

property and facilities on the 31 installations will be returned to the 

Government of South Korea for its use or disposition. Second, at the 

request of South Korea, USFK plans to move its personnel stationed at 

Yongsan Army Garrison and return the associated property and facilities; 

however, timelines have not been finalized. Two enduring installations 

Property Returns Are an 

Integral Part of Planned 

Overseas Basing Changes 
Page 20 GAO-04-609 Defense Infrastructure 

being considered for these units are Osan Air Force Base and Camp 

Humphreys. It is too early in the process to know when all of the many 

different USFK units located on Yongsan Army Garrison will be relocated. 

In PACOM’s area of responsibility, U.S. forces in Japan plan to return over 

12,000 acres of land on Okinawa, including the Marine Corps Air Station 

Futenma and land at Naha Port, to the Government of Japan after 

replacement facilities are constructed (see app. I, slide 24). As of April 

2004, there were 10 remaining land transfers pending and 47 military 

construction projects to be completed—all to be funded by the 

Government of Japan. 

In EUCOM’s area of responsibility, commands have closed over 560 

installations and returned the property and facilities to host nations over 

the last decade. In addition, U.S. Army Europe plans to close 13 

installations and facilities located throughout Germany—consisting of 

family housing, barracks, and training facilities—and consolidate them 

into a single location near Grafenwöhr under its Efficient Basing 

Grafenwöhr project (see app. I, slide 26). U.S. Navy Europe is planning to 

reduce overall facility requirements by consolidating its mission to its 

enduring bases in the Mediterranean Sea and at Naval Station Rota, Spain 

(see app. I, slide 27). For example, it plans to move the Command Navy 

Region Europe from London, United Kingdom, to Naples, Italy. The future 

disposition of the facilities in London has not yet been determined. Also, 

three parcels of land in Iceland have been nominated by U.S. Navy Europe 

for return to the host nation and are currently in the property return 

process. 

Also in EUCOM, U.S. Air Force Europe, at the request of the Government 

of Germany, plans to return all of the Rhein-Main Air Base to Germany 

(see app. I, slide 28). The base had been a co-use airfield with the 

Frankfurt International Airport, which the Germans wanted to expand. In 

order to satisfy the Frankfurt International Airport’s requirement for 

additional land, a portion of the U.S. Air Force’s mission was relocated to 

Ramstein Air Base, Germany, based on an agreement signed in 1993. This 

partial return moved the C-130 mission from Rhein-Main Air Base to 

Ramstein Air Base and returned 94 hectares of land to the Frankfurt 

International Airport. The facilities returned were valued at an estimated 

$62.5 million, and in exchange, U.S. Air Force Europe received the same 

value—$62.5 million—for 12 projects at Ramstein Air Base funded by the 

Frankfurt International Airport. In 1999 an agreement was signed 

transferring the strategic airlift mission to Ramstein and Spangdahlem air 

bases to allow the complete closure of the Rhein-Main Air Base and return 
Page 21 GAO-04-609 Defense Infrastructure 

the remaining 188 hectares of property to the Frankfurt International 

Airport. U.S. Air Force Europe will return a reported $166.8 million in 

facilities in exchange for 37 projects (plus some minor replacement facility 

projects) worth an estimated $425 million. Of the $425 million, 

approximately $92 million is anticipated to come from NATO, while the 

Frankfurt International Airport, the Government of Germany, two German 

states, and the city of Frankfurt will fund the balance. 

Residual value is dependent on the property returned to host-nation 

governments, which varies by status of forces agreements and other 

agreements between the United States and host nations. This can affect 

U.S. funding requirements overseas and the development and 

implementation of comprehensive master plans (see app. I, slides 16-17). 

Overseas regional commands can seek residual value for properties 

returned based on bilateral or supplementary international agreements 

with each host nation. However, the amount of money received from 

residual value programs has little to do with the amount originally 

invested; rather, proceeds are a function of current market conditions. The 

actual value of the returned property depends upon its reuse. As we 

previously reported, some countries approach residual value calculations 

differently than the United States, and unfortunately, in many cases there 

is not much of a market for operational military facilities, such as 

ammunition dumps.24 On the other hand, family housing may be reused 

and often results in residual value for the United States. The process must 

allow time for the marketing and sale of the properties, and as discussed 

previously, the residual value of the property returned may be offset by the 

cost of environmental remediation. 

In PACOM’s area of responsibility, the agreements with South Korea and 

Japan differ from the agreements used in some other locations—such as 

Germany—in that South Korea and Japan are not obliged to compensate 

the United States for any improvements made in facilities or for the 

buildings and structures returned. According to PACOM officials, because 

South Korea and Japan generally provide replacement facilities, there is no 

need for international agreements to provide for residual value. For 

example, the South Korean government is expecting to sell property 

 24 U.S. General Accounting Office, European Drawdown: Status of Residual Value 

Negotiations in Germany, GAO/NSIAD-94-195BR (Washington, D.C.: June 23, 1994) and 

Overseas Installations: Efforts to Recoup Residual Value of Closed Facilities, 

GAO/NSIAD-96-35 (Washington, D.C.: Jan. 26, 1996). 

Residual Value for 

Returned Property Varies 

by Country 
Page 22 GAO-04-609 Defense Infrastructure 

returned by USFK to raise capital to help finance the cost of moving U.S. 

forces near the demilitarized zone to areas south of Seoul and relocating 

the military personnel located at Yongsan Army Garrison. 

In EUCOM’s area of responsibility, since the early 1990s, officials have 

reportedly recouped approximately $175 million in cash through 

negotiated settlements with nine European countries and returned these 

funds to the U.S. Treasury. EUCOM, in cooperation with the Department 

of State and its embassies, is currently involved in residual value 

negotiations with the German, Greek, British, Dutch, Belgian, Turkish, and 

Italian governments. However, these negotiations can take a long time. For 

example, in Germany negotiations usually take between 4 to 8 years in 

order for the Government of Germany to market and sell a facility. In Italy, 

the bilateral agreement states that if the Government of Italy reuses the 

returned property within 3 years, the United States may negotiate for 

residual value. EUCOM may be able to recoup residual value for parcels of 

land in Iceland; however, due to their military nature, they may not have 

any reuse value. DOD officials expressed concern about the likelihood of 

obtaining any significant residual value for future property returns. 

In CENTCOM’s area of responsibility, arrangements vary by country—six 

host nations have agreements to allow for residual value negotiations, and 

nine countries have no such agreements. To date, CENTCOM has not 

recouped residual value from property returns. 

However, the amount of residual value the commands can expect to 

obtain in the future depends on how the host nation reuses the returned 

property. As with the level of burden-sharing—economically constrained 

markets, such as for some countries in EUCOM’s area of responsibility, 

coupled with reduced defense spending by some host nations and closure 

of their own military facilities—the market for property from closed U.S. 

military installations has dwindled, which may result in little, if any, 

residual value for returned properties. 

In some instances, the United States could potentially incur costs for 

environmental remediation before the host-nation government will accept 

the returned property (see app. I, slides 14-15). The extent to which 

overseas regional commands incur costs varies by country and can affect 

U.S.-funded infrastructure costs and the development and implementation 

of comprehensive master plans. Historically, overseas regional commands 

have incurred limited costs for environmental remediation as a result of 

these property returns. DOD Instruction 4715.8 establishes policy and 

United States May Incur 

Costs for Environmental 

Remediation of Property 

Returned to Host Nations 
Page 23 GAO-04-609 Defense Infrastructure 

provides guidance for environmental remediation of overseas facilities.25

Under this instruction, DOD components may be required to remediate 

property designated for return or returned to host nations if DOD-caused 

environmental contamination poses “known imminent and substantial 

endangerments to human health and safety” or there is a requirement by 

international agreement. 

Overseas commands’ remediation experience varies by country. 

Environmental remediation has become a more important issue in recent 

years in some Asian countries, unlike countries in the EUCOM area of 

responsibility where environmental remediation has been an ongoing issue 

since at least the early 1990s. For example, the component commands in 

South Korea and Japan have incurred limited costs to date, while in 

EUCOM potential costs for environmental remediation are estimated at 

about $90 million, regardless of whether the property is returned. In the 

future, greater negotiations may be required to address environmental 

remediation, because environmental issues are becoming an increasing 

concern in South Korea and Japan. For example, the United States and 

South Korea recently set procedures for addressing environmental 

remediation,26 and the Government of South Korea is updating its 

environmental governing standards. In addition, according to PACOM 

officials, the Government of Japan is enacting more stringent 

environmental laws. 

The level of U.S. funding required for overseas infrastructure costs varies 

by country-specific factors, and overseas commands have historically used 

various options to fund future infrastructure requirements, in addition to 

available host-nation funding (see app. I, slide 10). If history is a guide, 

once the Integrated Global Presence and Basing Strategy is complete and 

future infrastructure changes are fully identified, the overseas regional 

commands can be expected to use operation and maintenance and 

contingency operations appropriations, in addition to military 

 25 DOD Instruction 4715.8, Environmental Remediation for DOD Activities Overseas 

(Feb. 2, 1998). 

26 Environmental Subcommittee under the United States and the Republic of Korea Status 

of Forces Agreement, Memorandum for the Joint Committee: Procedures for 

Environmental Survey and Consultation on Remediation for Facilities and Areas 

Designated to Be Granted or Returned (May 30, 2003). 

Commands Have Multiple 

U.S. Funding Sources to 

Support Future 

Infrastructure Changes 
Page 24 GAO-04-609 Defense Infrastructure 

construction appropriations, including exercise-related construction 

authority, to fund ongoing and future infrastructure changes. 

In USFK, military infrastructure funding flows through nine 

organizations—the Army, the Navy, the Marine Corps, the Air Force, 

Special Operations, the Army and Air Force Exchange Service, the 

Defense Logistics Agency, the DOD Medical Command, and the Defense 

Commissary Agency. USFK plans to use military construction funds to 

upgrade a sewer system. It is also exploring “build to lease” housing at 

Camp Humphreys and other enduring installations in South Korea. Also, in 

PACOM’s area of responsibility, little or no U.S. military construction 

funding is needed in Japan, because the Government of Japan historically 

funds most facility requirements. In EUCOM, the military components plan 

to fund a series of smaller forward-operating bases and forward-operating 

locations strategically located throughout their area of responsibility. For 

example, EUCOM plans to begin the $285,000 first phase of a five-phase 

exercise reception facility complex in Azerbaijan, using exercise-related 

construction authority. Also, EUCOM uses exercise-related construction 

authority, generally in small amounts, to set up training exercises at 

locations where the United States may not have permanent facilities, such 

as renovating a camp in Albania, repairing training bases in Bulgaria, and 

constructing an exercise refueling facility in Tunisia. In CENTCOM, the 

military components use operation and maintenance funds through 

contractors to finance facility requirements for ongoing operations in Iraq. 

Given current budget constraints and other defense priorities, the ability 

of the overseas regional commands and their component commands to 

obtain the required U.S. funding levels for future infrastructure changes 

without tradeoffs in other areas is unclear. To illustrate, the Comptroller 

General stated in the March 2004 updated strategic plan27 for GAO that 

events over the past 2 years have placed even greater strains on limited 

national resources. The long-range fiscal outlook appears to be 

unsustainable, given existing federal commitments. Policymakers are, 

therefore, increasingly being called on to distinguish wants from needs 

and to judge what the nation can afford and sustain, both now and in the 

longer term. 

 27 U.S. General Accounting Office, Strategic Plan 2004-2009 (Washington, D.C.: 

March 2004). 
Page 25 GAO-04-609 Defense Infrastructure 

While OSD’s preliminary guidance directs the overseas regional commands 

to address the precise facility requirements, properties being returned to 

host nations, funding requirements, and the division of funding 

responsibilities between the United States and cognizant host nations in 

their comprehensive master plans, the extent to which the commands plan 

will address other factors—such as residual property value and 

environmental remediation issues, and multiple U.S. funding sources 

available to support future infrastructure changes—that are not clearly 

specified in OSD’s preliminary guidance remains unclear. Continued 

monitoring and identification of these additional factors would make the 

comprehensive master plans and the required periodic report on the 

progress of their implementation more useful as tools to the services and 

overseas regional commands in managing U.S. military infrastructure and 

associated costs overseas, and provide Congress and OSD with more 

complete information for their oversight responsibilities. 

While overseas regional commands are working on developing and 

implementing plans for installations they believe will have an enduring 

presence, they have limited efforts under way to address the requirements 

to develop comprehensive master plans as defined by the Senate report. 

Rather, they are awaiting the completion of the Integrated Global Presence 

and Basing Strategy and the receipt of OSD’s finalized guidance for 

developing these plans. OSD’s preliminary guidance directs the overseas 

regional commands to address several key factors—the precise facility 

requirements, properties being returned to host nations, funding 

requirements, and the division of funding responsibilities between the 

United States and cognizant host nations—in their comprehensive master 

plans. However, the extent to which the commands plan to address 

residual property value and environmental remediation issues and U.S.-

funded costs associated with future infrastructure changes remains 

unclear. However, including information on these factors could be 

important to ensuring more complete comprehensive plans. First, without 

addressing the extent to which DOD expects to obtain residual value for 

properties returned to each host nation, if any, and offset environmental 

remediation costs, the comprehensive master plans would fail to identify 

all the expected capital available to help finance the cost of moving and 

consolidating U.S. forces overseas and improving their facilities. Second, 

without addressing the potential for multiple U.S. funding sources 

available to support future infrastructure changes, the comprehensive 

master plans might not fully identify the extent to which overseas regional 

commands and their component commands plan to rely on these funding 

sources compared to host-nation contributions. Continued monitoring and 

Opportunity to Strengthen 

Overseas Regional 

Commands’ 

Comprehensive Master 

Plans and Periodic Status 

Reports 

Conclusions 
Page 26 GAO-04-609 Defense Infrastructure 

identification of these factors would make the comprehensive master 

plans and the required periodic status reports more useful as tools to the 

military services and overseas regional commands in managing U.S. 

military infrastructure and U.S.-funded associated costs overseas, and 

more informative for Congress and DOD in their oversight responsibilities. 

To make future comprehensive master plans and periodic reporting to 

Congress on their implementation more useful in managing U.S. military 

infrastructure and associated costs and more informative for Congress and 

OSD in their oversight responsibilities, we recommend that the Secretary 

of Defense direct the Under Secretary of Defense for Acquisition, 

Technology and Logistics to require that overseas regional commanders 

(1) address the extent to which implementation of their master plans will 

be affected by residual property value and environmental remediation 

issues, as well as multiple U.S. funding sources available to support future 

infrastructure changes and include this information in their 

comprehensive master plans, and (2) provide updated information on the 

applicability of residual property value and environmental remediation 

issues and multiple U.S. funding sources in their annual status reports to 

Congress on the master plans. 

In commenting on a draft of this report, the Principal Assistant Deputy 

Under Secretary of Defense (Installations and Environment) partially 

concurred with our recommendations. While DOD concurred that future 

comprehensive master plans should address environmental issues, the 

department did not concur that master plans should include assessments 

of residual value or multiple funding sources. According to DOD officials, 

residual value is obtained through negotiations and cannot be predicted 

and therefore should not be assumed in a master plan. Likewise, master 

plans should not include multiple funding sources because military 

construction projects that would be eligible for these alternate funding 

sources are subject to funding thresholds and should not appear on a 

master plan. While we acknowledge the uncertainties of obtaining residual 

value for returned property and thresholds for multiple funding sources, 

we believe overseas regional commands should identify residual property 

value issues as they evolve, as well as identify multiple U.S. funding 

sources that may be available to support future infrastructure changes, 

and include that information in their annual status reports to Congress on 

their master plans. Our recommendations as originally written could be 

interpreted as being applicable only to the commands’ master plans. 

Instead, we have modified our recommendations to identify the extent to 

Recommendations for 

Executive Action 

Agency Comments 

and Our Evaluation 
Page 27 GAO-04-609 Defense Infrastructure 

which implementation of their master plans will be affected by these 

factors as they evolve in DOD’s annual status reports to Congress and to 

recognize that information on these issues may evolve over time. DOD’s 

comments are included in this report as appendix II. DOD also provided 

technical changes, which we incorporated as appropriate. 

To determine the status of development of overseas regional commands’ 

comprehensive master plans, we visited USFK, PACOM, EUCOM, and 

SOCOM to discuss the development of comprehensive master plans. We 

reviewed and analyzed policies, directives, reports, briefings, and 

information and guidance on overseas military construction. To assess the 

level of guidance available to the commands on development and 

implementation of comprehensive master plans, we met with OSD officials 

to discuss the status of guidance distributed to the commands. 

To assess factors—such as associated costs, burden-sharing implications, 

planned property returns, environmental remediation issues, and residual 

values—that can affect U.S. infrastructure costs overseas and the 

development and implementation of comprehensive master plans, we 

reviewed and analyzed available reports, documents, policies, directives, 

host-nation international agreements, and information and guidance on 

each of the above factors. We also discussed the effect of each of these 

issues on command master plans with USFK, PACOM, EUCOM, and 

SOCOM officials as well as officials at each of the component commands 

and agencies we visited—Eighth Army, South Korea; Army Installation 

Management Agency, South Korea Regional Office; Army Corps of 

Engineers, South Korea; 7th Air Force, South Korea; and U.S. Naval 

Forces, South Korea; U.S. Army, Pacific; U.S. Pacific Air Force; U.S. 

Pacific Fleet; U.S. Marine Forces, Pacific; U.S. Army, Europe; Army 

Installation Management Agency, Europe Regional Office; U.S. Air Force, 

Europe; and U.S. Navy, Europe. At each command, we discussed potential 

U.S.-associated costs for implementing such master plans, burden-sharing 

implications, property returns to host nations, the potential U.S. costs for 

environmental remediation, and residual value likely to be obtained by the 

United States as a result of those property returns. In South Korea, we met 

with the Deputy Chief of Mission at the U.S. Embassy South Korea to 

discuss the U.S. diplomatic perspective on potential basing changes in 

South Korea, burden-sharing implications, and the political sensitivities of 

environmental impacts. We also met with an official from the Republic of 

South Korea Ministry of National Defense to obtain a host-nation 

perspective on the status of implementation of master plans and burdensharing implications for relocation of U.S. facilities in South Korea and to 

Scope and 

Methodology 
Page 28 GAO-04-609 Defense Infrastructure 

discuss funding and time frames for decisions by the Republic of South 

Korea. We also discussed, from the host-nation perspective, potential U.S. 

costs for environmental remediation of property returns to the host nation. 

To obtain the DOD perspective on issues in South Korea and Japan, we 

met with officials in the Office of the Secretary of Defense, Asian-Pacific 

Affairs Office. We also met with officials in the Office of the Secretary of 

Defense to determine the guidance and criteria provided to overseas 

regional commands for development of comprehensive master plans. 

Through our review of the data, examination of specific data elements, 

and discussions with DOD officials, we believe the data gathered are 

sufficiently reliable for the purposes of this report, except for data 

generated by CENTCOM. Because of ongoing operations, we were not 

able to meet with CENTCOM officials to discuss the development of 

comprehensive master plans, factors that can affect U.S. costs or data 

reliability. However, we obtained written responses to questions on 

overseas presence and basing, U.S.-associated costs, burden-sharing 

implications, property returns to host nations, potential U.S. liability for 

environmental remediation, and residual value likely for property returns 

to host nations. 

We conducted our work from November 2003 through April 2004 in 

accordance with generally accepted government auditing standards. 

We are sending copies of this report to the Secretaries of Defense, the 

Army, the Navy, and the Air Force; the Commandant of the Marine Corps; 

and the Director, Office of Management and Budget. Copies will be made 

available to others upon request. In addition, this report will be available 

at no charge on our Web site at http://www.gao.gov. 

Please contact me at (202) 512-8412, or my Assistant Director, Mark Little, 

at (202) 512-4673 if you or your staff has any further questions regarding 

this report. Major contributors to this report were Donna Rogers, Nelsie 

Alcoser, Ella Mann, and R.K. Wild. 

Barry W. Holman, Director 

Defense Capabilities and Management 
Page 29 GAO-04-609 Defense Infrastructure 

Congressional Committees 

The Honorable John W. Warner 

Chairman 

The Honorable Carl Levin 

Ranking Minority Member 

Committee on Armed Services 

United States Senate 

The Honorable Kay Bailey Hutchison 

Chairman 

The Honorable Dianne Feinstein 

Ranking Minority Member 

Subcommittee on Military Construction 

Committee on Appropriations 

United States Senate 

The Honorable Duncan L. Hunter 

Chairman 

The Honorable Ike Skelton 

Ranking Minority Member 

Committee on Armed Services 

House of Representatives 

The Honorable Joe Knollenberg 

Chairman 

The Honorable Chet Edwards 

Ranking Minority Member 

Subcommittee on Military Construction 

Committee on Appropriations 

House of Representatives 
Appendix I: GAO Briefing Slides 

Page 30 GAO-04-609 Defense Infrastructure 

Appendix I: GAO Briefing Slides 

Preliminary Observations 1

Review of Comprehensive Master 

Plans for Overseas Military Facilities

Preliminary Observations

April 2004

(Updated July 2004)
Appendix I: GAO Briefing Slides 

Page 31 GAO-04-609 Defense Infrastructure 

Preliminary Observations 2

 Objectives

 Background

 Scope

 Definitions

 Results in brief

 Part I: Master plans (overall)

 Implementation status

 Associated costs

 Burden-sharing implications

 Returned property

 Property returned

 Environmental remediation

 Residual value 

 Part II: Details by individual overseas regional commands

Outline
Appendix I: GAO Briefing Slides 

Page 32 GAO-04-609 Defense Infrastructure 

Preliminary Observations 3

 Senate Report 108-82 directed GAO to monitor the 

infrastructure master plans being developed and 

implemented for the overseas regional commands and 

provide an assessment of the

 implementation of plans, plan costs, and host nation 

burden-sharing implications, and 

 issues related to property returned to host nations, 

environmental restoration, and residual values of 

returned property.

 GAO’s assessment is required to be completed by May 

15 of each year through fiscal year 2008.

Objectives
Appendix I: GAO Briefing Slides 

Page 33 GAO-04-609 Defense Infrastructure 

Preliminary Observations 4

Scope

 We visited the following overseas regional and component commands:

 U.S. Forces Korea Command (USFK)

 Eighth Army

 Installation Management Agency--Korea Regional Office

 7th Air Force

 Commander, U.S. Naval Forces Korea

 U.S. Army Corp of Engineers 

 U.S. Embassy in Korea

 Republic of Korea, Ministry of National Defense

 U.S. Pacific Command (PACOM)

 U.S. Army Pacific

 U.S. Pacific Fleet

 U.S. Marine Forces Pacific

 U.S. Pacific Air Force

 U.S. European Command (EUCOM)

 U.S. Army Europe 

 Installation Management Agency--Europe

 U.S. Navy Europe 

 U.S. Air Force Europe 

 U.S. Special Operations Command (SOCOM)

 We discussed infrastructure master planning with and collected data from U.S. Central Command (CENTCOM).
Appendix I: GAO Briefing Slides 

Page 34 GAO-04-609 Defense Infrastructure 

Preliminary Observations 5

Senate Appropriations Committee expressed concern about the 

use of military construction budget authority for projects at bases 

that may soon be obsolete due to changes being considered in 

overseas presence and basing. 

The conference report accompanying the fiscal year 2004 military 

construction appropriation bill directed the Department of Defense 

(DOD) to prepare detailed comprehensive master plans for 

changing infrastructure requirements for U.S. military facilities 

within each of its overseas regional commands. 

 

In addition, the conference report directed DOD to provide a 

base report with the fiscal year 2006 military construction 

budget submission with annual updates on the status of master 

plans and their implementation with each of the military 

construction budget submissions for fiscal years 2006-2009. 

Background
Appendix I: GAO Briefing Slides 

Page 35 GAO-04-609 Defense Infrastructure 

Preliminary Observations 6

 Master Plans: As defined in Senate Report 108-82, master 

plans should include, at a minimum,

 precise facility requirements,

 status of property being returned to host nations,

 funding requirements, and

 division of responsibilities between the United States and 

host nations.

 Burden-sharing: Amount and type of contributions from host 

nations to assist with changing infrastructure requirements.

 Direct: Payments of certain U.S. stationing costs by a host nation (e.g., cash).

 Indirect: Cost deferrals or waivers of taxes, fees, rents and 

other charges, such as forgone revenues (e.g., rent-free, 

various tax exemptions, and reduced-cost services).

 Payment-in-Kind: Host nation-funded construction, 

logistics, and labor support.

Definitions
Appendix I: GAO Briefing Slides 

Page 36 GAO-04-609 Defense Infrastructure 

Preliminary Observations 7

 Associated Costs: U.S. funding requirements to implement 

master plans.

 Environmental Remediation: Actions taken to remove or 

lower an environmental soil or ground water contamination to 

levels below a certain threat level.

 Residual Value: Negotiated dollar value of U.S.-constructed 

or –improved facilities that are returned to host nations for 

their use or disposal.

Definitions (cont.)
Appendix I: GAO Briefing Slides 

Page 37 GAO-04-609 Defense Infrastructure 

Preliminary Observations 8

• Master plans: Commands we reviewed have not prepared master 

plans as defined by Senate Report 108-82; however, planning efforts 

are underway.

 Office of the Secretary of Defense (OSD) developing guidance including template to ensure consistent master plans. Until OSD issues guidance, commands developing plans for enduring bases.

• Master plans dependent upon outcome of Integrated Global Presence & Basing Strategy.

• Associated costs: Level of U.S. funding required will vary depending 

upon host-nation support.

• Burden-sharing: Contributions from Japan and Korea exceed what 

countries within EUCOM or CENTCOM contribute.

• Property returns: Significant property returns pending for Korea, 

Japan, and EUCOM.

• Environmental remediation: Ongoing issue within EUCOM; 

increasingly becoming a concern in Korea and Japan.

• Residual value: Issue within EUCOM; not Korea, Japan (host nation 

funds relocation).

Results in Brief
Appendix I: GAO Briefing Slides 

Page 38 GAO-04-609 Defense Infrastructure 

Preliminary Observations 9

 Neither USFK, PACOM, EUCOM, nor CENTCOM have 

prepared comprehensive master plans as defined by 

Senate Report 108-82; however, numerous planning 

efforts are underway (additional details provided in part II).

 OSD has developed preliminary guidance for 

comprehensive master plans, which will include a 

template to ensure all overseas combatant commands 

provide consistent master plans. 

 Until OSD guidance is issued, commands are 

developing plans for enduring bases (i.e., bases the 

commands believe will remain in the master plans on a 

long-term basis).

 Master plans are dependent upon the outcome of 

DOD’s Integrated Global Presence & Basing Strategy 

scheduled to be completed by the end 2004.

Part I: Master Plans

Implementation Status
Appendix I: GAO Briefing Slides 

Page 39 GAO-04-609 Defense Infrastructure 

 U.S. costs associated with ongoing and planned infrastructure 

changes are funded in various ways, such as with military 

construction, including exercise -related construction, operation 

and maintenance, and nonappropriated funding (e.g., Army 

and Air Force Exchange Service (AAFES). Other sources 

of funding may include Department of Defense Dependents 

Schools, Medical Command, Defense Logistics Agency, 

and Defense Commissary Agency. 

 For example

 Korea: U.S. expects to fund a limited portion out of military construction funds.

 Japan: Little or no U.S. military construction funds needed in Japan.

 EUCOM: U.S. funds majority of costs from military construction and exercise-related funding.

 CENTCOM: U.S. funds costs from ongoing Operations Iraqi and Enduring Freedom contingency operation funds.

Part I: Master Plans

Associated Costs

Preliminary Observations 10
Appendix I: GAO Briefing Slides 

Page 40 GAO-04-609 Defense Infrastructure 

Preliminary Observations 11

 The burden-sharing contributions from Japan and Korea exceed what 

countries within the EUCOM or CENTCOM area of responsibility 

contribute. For example, Japan and Korea contributed about 73 percent of 

the total host-nation support for U.S. military personnel stationed overseas 

in 2001 (most recent data available) as reported in DOD’s July 2003 Report

on Allied Contributions to the Common Defense. NATO allies within the 

EUCOM area of responsibility and countries within the CENTCOM area of 

responsibility contributed about 21 percent and 6 percent, respectively, of 

total burden-sharing contributions worldwide for 2001. 

 For example

 Korea: According to USFK officials, Special Measures Agreement provides logistics, labor support, and host nation-funded construction 

(valued at $593 million in fiscal year 2004). In addition, the United 

States expects Korea to provide funds to replace facilities and land 

pending Korean National Assembly vote in June 2004 on amended 

Land Partnership Plan and Yongsan Relocation.  Japan: According to PACOM officials, Special Measures Agreement provides financial support for labor, utilities, and training relocation. 

Japan’s Facilities Improvement Program provides in-kind construction 

support. Government of Japan funds facilities realignment under The 

Special Action Committee on Okinawa Final Report.

Part I: Master Plans

Burden-sharing Implications
Appendix I: GAO Briefing Slides 

Page 41 GAO-04-609 Defense Infrastructure 

Preliminary Observations 12

 EUCOM: Many European countries provide various types of 

host-nation support; however, as reported in DOD’s July 2003 

Report on Allied Contributions to the Common Defense, Germany 

and Italy have been the largest contributing European 

nations, providing support valued at $862 million and $324 

million for calendar year 2001, respectively.

 NATO Security Investment Program provides 

construction funds to support approved NATO military 

commander’s requirements.

 CENTCOM: United Arab Emirates, Qatar, and Kuwait 

currently provide or have agreed to provide $534 million in 

support of U.S. facilities for fiscal year 1999 through the 

second quarter of fiscal year 2004. According to CENTCOM 

officials, the Kingdom of Saudi Arabia provided facility and 

assistance-in-kind support prior to fiscal year 1999.

Part I: Master Plans

Burden-sharing Implications (cont.)
Appendix I: GAO Briefing Slides 

Page 42 GAO-04-609 Defense Infrastructure 

Preliminary Observations 13

 Significant property returns pending for Korea, Japan, and 

EUCOM.

 Property returns planned or underway:

 Korea: Planned consolidation of 41 major installations 

down to 10 (3-acre taxi annex in Seoul returned and sold 

by Republic of Korea government for $40 million).

 Japan: Ongoing return of 12,361 acres in Okinawa from 

various Army and Marine Corps camps and training areas 

under The Special Action Committee on Okinawa Final 

Report.

 EUCOM: Return of facilities planned under Efficient 

Basing Grafenwöhr—U.S. Army Europe planned 

consolidation of about 13 locations throughout Germany 

to Grafenwöhr.

 NATO Security Investment Program-funded properties 

are handled by NATO and the host nation.

Part I: Returned Property 

Property Returned
Appendix I: GAO Briefing Slides 

Page 43 GAO-04-609 Defense Infrastructure 

Preliminary Observations 14

 In Korea and Japan, environmental remediation has become 

an issue in recent years.

 Status of Forces Agreements in Korea and Japan provide 

procedures for the return of land, including provisions for 

environmental issues.

 Environmental remediation has been an ongoing issue with 

countries within the EUCOM area of responsibility.

 DOD Instruction 4715.8 directs the components, subject to 

the availability of funds, to remediate property designated for 

return or returned to host nations if

 The environmental damage poses “known imminent and 

substantial endangerments to human health and safety.” 

 There is a specific requirement by international 

agreement.

Part I: Returned Property 

Environmental Remediation
Appendix I: GAO Briefing Slides 

Page 44 GAO-04-609 Defense Infrastructure 

Preliminary Observations 15

 Overseas commands’ remediation experience varies by 

country:

 Korea: Environmental issues of increasing concern.

 The United States and Republic of Korea recently set 

procedures for addressing environmental remediation.

 Korea is updating its Environmental Governing 

Standards.

 Japan: Environmental issues of increasing concern.

 Polychlorinated biphenyl problems.

 AAFES gasoline leak.

 EUCOM: Environmental remediation has been an issue 

since the United States began returning property in early 

1990s.

 Germany: Current estimate to clean up German sites 

in future is $90.1 million.

Part I: Returned Property 

Environmental Remediation (cont.)
Appendix I: GAO Briefing Slides 

Page 45 GAO-04-609 Defense Infrastructure 

Preliminary Observations 16

 Residual value varies by Status of Forces Agreements and 

other agreements between the U.S. and host nations. 

 Since the early 1990s, EUCOM has recouped approximately 

$175 million from 9 European countries and returned it to the 

U.S. Treasury.

 The United States can seek residual value for properties 

returned based on international agreements with each 

host nation (i.e., bilateral agreements, supplementary 

agreements, etc.).

 Residual value depends on the reuse of the returned 

properties (e.g., family housing will more likely result in 

residual value than ammunition storage sites).

 Residual value may be offset by environmental 

remediation costs.

Part I: Returned Property 

Residual Value
Appendix I: GAO Briefing Slides 

Page 46 GAO-04-609 Defense Infrastructure 

Preliminary Observations 17

 Within EUCOM:

 Interim settlement for Frankfurt Hospital, Bitburg and 

Sembach air bases, and multiple small sites in Germany.

 Negotiations underway for 36 installations in Germany, 

Herndon Housing in the United Kingdom, multiple radar sites 

in Turkey, and Hellenikon and Iraklion air bases in Greece. 

 Germany: Negotiations take about 4-8 years in order for the German government to market and sell a facility.

 Italy: Bilateral agreement states that if the Government 

of Italy reuses returned property within 3 years, the 

United States may reopen residual value negotiations.

 CENTCOM: U.S. compensation for residual value of returned 

properties within CENTCOM’s area of responsibility varies 

based on negotiated country agreements (e.g., 6 countries allow 

residual value negotiations while 9 countries have no residual 

value agreement or provision). Also, some Central Asian states 

of the former Soviet Republic have signed Partnership for Peace 

agreements that may address claims of residual value.

Part I: Returned Property 

Residual Value (cont.)
Appendix I: GAO Briefing Slides 

Page 47 GAO-04-609 Defense Infrastructure 

Preliminary Observations 18

 Master Plan: No comprehensive master plan as defined by Senate Report 108-82; however, there are various limited 

master planning efforts underway for enduring bases. 

 Associated Costs: Planned U.S.-funded military construction for enduring bases Army—$40 million (fiscal 

year 2004), $108 million (fiscal year 2006), and $64 million 

(fiscal year 2007).

 Burden-sharing Implications: Republic of Korea estimated contributions valued at over $4.7 billion (combination of cash 

and payment-in-kind) during fiscal years 2004 through 2008.

 Property Returns to Host Nation: Plan to reduce major 

installations from 41 down to 10 assuming revision of Land 

Partnership Plan based on the Future of the Alliance talks. 

 Environmental Remediation Issues: Status of Forces 

Agreement provides procedures for returning land including 

provisions for environmental issues.

 Residual Value: Not applicable.

Part II: Overseas Regional Commands

U.S. Forces Korea
Appendix I: GAO Briefing Slides 

Page 48 GAO-04-609 Defense Infrastructure 

Preliminary Observations 19

Part II: USFK Alignments

Current

Interim ~2005

Source: USFK.

Pusan

Mu Juk

.

.

.

. . .

.

. .

.

.

.

..

.

.

. .

.

..

.

.

.

.

. .

. . . . .

.

.

.

. . .

.

.

.

. . .

. .

.

.

.

.

.

. . .

.

.

.

.

.

.

.

Osan/Humphreys

Han River

Kunsan

Chinhae

Noksan

Taegu

Osan/Humphreys

Pusan

Seoul

Chinhae

Taegu

Han River

Mu Juk

Kunsan Noksan

Casey

Joint Warrior 

Training 

Center

Future ~2008

Osan/Humphreys

Pusan

Seoul

Chinhae

Taegu

Han River

Mu Juk

Kunsan Noksan

Joint Warrior 

Training 

Center

Seoul

Army

Navy

Air Force

Marines

Current installations

Joint Headquarters

Prepositioned equipment

LEGEND
Appendix I: GAO Briefing Slides 

Page 49 GAO-04-609 Defense Infrastructure 

Preliminary Observations 20

Existing

Humphreys

1,210 acres

2

4

3

1A

1B

2nd Keong Bu 

Expressway

Part II: Camp Humphreys Land Grants

(2004-2008)

Source: USFK.

Land Grants:

Parcel Size Year

1A 200 acres Jun 2004

1B 478 acres Dec 2004

2* 163 acres 2004 

(*Grant for Build to Lease) (*Grant for Build to Lease)

3 1,062 acres 1,062 acres 2005 

4 200 acres 200 acres 2008

Existing acres: 1,210 acres Existing acres: 1,210 acres 

Future acres: 3,313 acres
Appendix I: GAO Briefing Slides 

Page 50 GAO-04-609 Defense Infrastructure 

Preliminary Observations 21

The real property master plan for Camp 

Humphreys was issued in March 2004.

Source: USFK.

Part II: Concept Master Plan for 2nd Infantry 

Division—Relocation to Camp Humphreys
Appendix I: GAO Briefing Slides 

Page 51 GAO-04-609 Defense Infrastructure 

Preliminary Observations 22

Part II: Osan Air Force Base

Existing Osan Air Base

1,700 acres 1

1

Land Grants: Land Grants:

Parcel Size Year

1 604 acres 2004

2 245 acres 2004

Existing acres: 1,700 acres

Future acres: 2,550 acres

Source: USFK.

2
Appendix I: GAO Briefing Slides 

Page 52 GAO-04-609 Defense Infrastructure 

Preliminary Observations 23

 Master Plan: No comprehensive master plan as defined by Senate 

Report 108-82; however, component commands have ongoing 

planning efforts for enduring bases.

 Associated Costs: Not applicable.

 Burden-sharing Implications: Total host-nation support valued at 

$3.7 billion (projected fiscal year 2004), Japan Facilities Improvement 

Program to U.S. Forces Japan—expected to decrease to about $650 

million per year, in comparison to an average $744 million from fiscal 

years 2000-2004.

 Property Returns to Host Nation: The Special Action Committee on 

Okinawa Final Report reduces U.S. land use 21 percent or 12,361 

acres.

 Environmental Remediation Issues: More stringent environmental 

laws, updating Environmental Governmental Standards, 

polychlorinated biphenyl problems, and AAFES gas leak.

 Residual Value: Not applicable.

Part II: Overseas Regional Commands

U.S. Forces Japan
Appendix I: GAO Briefing Slides 

Page 53 GAO-04-609 Defense Infrastructure 

Preliminary Observations 24

Part II: Special Action Committee 

on Okinawa (SACO)

SENAHA 

COMMUNICATIONS SITE

(Relocate to Torii Station)

NAHA PORT

(Relocate off MSA)

SOBE 

COMMUNICATIONS

SITE

(Relocate to Camp Hansen)

MAKIMINATO

SERVICE AREA

(Partial release)

GIMBARU

TRAINING AREA

(Relocate to Kin Blue)

IE JIMA

Kin Blue

White Beach Awase

Comm

Camp Courtney

Camp 

McTureous

Camp Schwab

Camp Hansen

MSA

AHA TRAINING

AREA

(Complete)

NORTHERN 

TRAINING AREA

(Partial release)

CAMP ZUKERAN

(Housing consolidation)

Torii 

Station

Stalled

Release complete

Active

U.S. installations not

reduced by SACO

YOMITAN AUX AIRFIELD

(Relocate to Ie Jima)

CAMP KUWAE

(Relocate to Camp Zukeran)

FUTENMA

(Relocate off Camp Schwab)

Source: Pacific Command.

CTA

Kadena
Appendix I: GAO Briefing Slides 

Page 54 GAO-04-609 Defense Infrastructure 

Preliminary Observations 25

• Master Plan: No comprehensive master plan as defined by Senate Report 

108-82; however, component commands have ongoing planning efforts for 

enduring bases.

• Associated Costs: Fiscal year 2004 military construction projects total $458.3 million and include 30 projects from various services and agencies, 

as well as the Army initiative—Efficient Basing Grafenwöhr.

• Burden-sharing Implications: The level of support during calendar year 2002 is valued at $1.56 billion, with Germany and Italy contributing the 

majority (valued at $861.6 million and $324 million, respectively). Of 

Germany’s contribution, $365.3 million was payment-in-kind for military 

construction projects at a number of U.S. facilities, including Ramstein, 

Mannheim, Baumholder, Stuttgart. Future burden-sharing is undetermined. 

• Property Returns to Host Nation: Under the Efficient Basing Grafenwöhr 

initiative, 13 locations have already been marked for return, time frame 

pending full funding of relocation.

• Environmental Remediation Issues: Services remediate sites to meet 

appropriate bilateral or supplementary agreement requirements or DOD 

policy (4715.8). Estimate to clean German sites in future is $90.1 million.

• Residual Value: Approximately $175 million has been recouped in cash 

from 9 countries since the early 1990s.

Part II: Overseas Regional Commands

European Command
Appendix I: GAO Briefing Slides 

Page 55 GAO-04-609 Defense Infrastructure 

Preliminary Observations 26

Part II: Overseas Regional Commands

European Command Efficient Basing Grafenwöhr

• Efficient Basing Grafenwöhr

• Army to consolidate 3,500 soldiers and dependents 

from 13 locations in 

Germany to a single 

location at Grafenwöhr.

• Locations due to 

consolidate are in and 

around the cities of 

Friedberg and Giessen:

• Friedberg: Alvin York Village Family Housing, McArthur Place 

Family Housing, Roman Way 

Village Family Housing, Schloss 

Kaserne, Friedberg Training & 

Storage Area, Ray Barracks 

Troop Support.

• Giessen: Butbach Training & Range Area, George Gershwin 

Family Housing, George C. 

Marshall Village Family Housing, 

Community Support Giessen, 

John F. Dulles Village Family 

Housing, Pendleton Barracks, 

Giessen General Depot (partial).

Consolidation Site Grafenwöhr, Germany

Source: GAO and CIA.
Appendix I: GAO Briefing Slides 

Page 56 GAO-04-609 Defense Infrastructure 

Preliminary Observations 27

Part II: Overseas Regional Commands

European Command Current Navy Locations

Source: U.S. Navy Europe.

Navy Europe Areas of Activities
Appendix I: GAO Briefing Slides 

Page 57 GAO-04-609 Defense Infrastructure 

Preliminary Observations 28

Part II: Overseas Regional Commands

European Command Air Force Transition

 At the request of the 

Government of Germany, Air 

Force agreed to move its air 

base from the Rhein-Main 

airport to Ramstein Air Base.

 During two phases, 

approximately $487.5 million 

in construction has been 

realized in lieu of cash 

recoveries via payment-in-kind 

or quid pro quo arrangements:

 In 1993 Rhein-Main Ramstein 

Air Base Benefit funded a 

partial pullout from the 

airport—$62.5 million.

 In 1999 a full pullout was 

negotiated resulting in funding 

to replicate Rhein-Main and 

Spangdahlem Air Base 

Strategic Capabilities—$425 

million.

Rhein-Main Air Base Move to Ramstein Air Force Base

Source: GAO and CIA.
Appendix I: GAO Briefing Slides 

Page 58 GAO-04-609 Defense Infrastructure 

Preliminary Observations 29

• Master Plan: No comprehensive master plan as defined by Senate Report 

108-82; however, component commands have submitted contingency 

construction requirements in support of ongoing operations.

• Associated Costs: $531 million for contingency construction requirements. 

Burden-sharing Implications: United Arab Emirates, Qatar, and Kuwait have 

agreed or currently provide support valued at over $534 million from fiscal year 

1999 through second quarter fiscal year 2004 for U.S. facility requirements (Air Force—valued at $301 million, Army—valued at $213 million, and Navy— valued at $20 million). According to CENTCOM officials, the Kingdom of Saudi 

Arabia provided support prior to fiscal year 1999 with facility and assistance-inkind.

• Property Returns to Host Nations: Once DOD approves CENTCOM’s 

basing strategy, CENTCOM can identify the number of installations to be 

returned to host nations. 

• Environmental Remediation Issues: Not available.

• Residual Value: Varies by country; 6 countries have agreements to allow 

negotiations for residual value; 9 countries have no agreements or provisions to 

negotiate residual value for returned properties. Some of the former Soviet 

Republic Central Asian states of Kyrgyzstan, Kazakhstan, Turkmenistan, 

Uzbekistan, and Tajikistan have signed or ratified Partnership for Peace 

agreements and other agreements with the United States. Some of these 

agreements may address claims of residual value; others may not.

Part II: Overseas Regional Commands 

Central Command
Appendix I: GAO Briefing Slides 

Page 59 GAO-04-609 Defense Infrastructure 

Preliminary Observations 30

 Master Plan: SOCOM has not prepared a master plan. SOCOM plans 

support geographic combatant commanders and funds only special 

operations forces specific facilities (e.g., hangers for special operations 

forces aircraft and training ranges).

 Associated Costs: Integrated Global Presence & Basing Strategy may 

result in some repositioning of SOCOM forces. According to SOCOM 

officials, the current military construction budget of $80 million would not be 

sufficient for such repositioning of forces.

 Burden-sharing Implications: Base executive agents (military services) 

will handle these issues. SOCOM is a tenant and does not own facilities.

 Property Returns to Host Nations: Base executive agent will handle 

these issues. 

 Environmental Remediation Issues: Base executive agent will handle 

these issues. According to OSD officials, in some cases, executive agents 

have been appointed for property returns as well as environmental issues 

and are not always the same service that is responsible for base

operations.

 Residual Value: Base executive agent will negotiate residual value.

Part II: Overseas Regional Commands 

Special Operations Command
Appendix II: Comments from the Department 

of Defense 

Page 60 GAO-04-609 Defense Infrastructure 

Appendix II: Comments from the Department 

of Defense 
Appendix II: Comments from the Department 

of Defense 

Page 61 GAO-04-609 Defense Infrastructure (350457) 
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