```
Arms Control: Status of U.S.-Russian Agreements and the Chemical Weapons
Convention (Chapter Report, 03/15/94, GAO/NSIAD-94-136).

Since 1928, an international treaty has banned the use of chemical
weapons but not their development and production. The number of
countries suspected of having or developing such weapons has risen to
24. A new multilateral treaty, the Chemical Weapons Convention, would
require the destruction of chemical weapons and the means to produce
them. The United States, although a signatory, has yet to ratify the
convention. Earlier, the United States signed bilateral agreements with
Russia aimed at destroying both countries' chemical weapon stockpiles.
This report evaluates (1) the progress made in implementing the
bilateral agreements with Russia; (2) the status of the Chemical Weapons
Convention; and (3) the costs incurred by the United States in preparing
for and implementing the treaties.

--------------------------- Indexing Terms -----------------------------

 REPORTNUM:  NSIAD-94-136
     TITLE:  Arms Control: Status of U.S.-Russian Agreements and the 
             Chemical Weapons Convention
      DATE:  03/15/94
   SUBJECT:  Arms control agreements
             Chemical warfare
             International agreements
             International relations
             International organizations
             Nuclear proliferation
             Munitions
             Weapons
             Hazardous substances
             Cost control
IDENTIFIER:  Russia
             Egypt
             Libya
             Iraq
             Syria
             North Korea
             Taiwan
             GB Nerve Gas
             VX Nerve Gas
             Mustard Gas
             Johnston Atoll Chemical Agent Disposal System
             La Hague (France)
             Germany
             International Monetary Fund
             European Community
             Sweden
             Fiji
             Mauritius
             Seychelles
             Saudi Arabia
             Norway
             Oman
             Indian Head (MD)
             Dulles International Airport (VA)
             Chemical Weapons Convention
             
**************************************************************************
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Cover
================================================================ COVER

Report to the Chairman, Committee on Foreign Relations, U.S.  Senate

March 1994

ARMS CONTROL - STATUS OF
U.S.-RUSSIAN AGREEMENTS AND THE
CHEMICAL WEAPONS CONVENTION

GAO/NSIAD-94-136

Arms Control

Abbreviations
=============================================================== ABBREV

  ACDA - Arms Control and Disarmament Agency
  GAO - General Accounting Office
  OPCW - Organization for the Prohibition of Chemical Weapons

Letter
=============================================================== LETTER

B-256678

March 15, 1994

The Honorable Claiborne Pell
Chairman, Committee on Foreign
 Relations
United States Senate

Dear Mr.  Chairman: 

This report discusses the status and costs of two agreements between
the United States and Russia and the Chemical Weapons Convention,
which are directed at ridding the world of chemical weapons. 

Unless you publicly announce its contents earlier, we plan no further
distribution of this report until 6 days from its issue date.  At
that time, we will send copies of this report to the Secretaries of
State, Defense, and Energy; the Director of the Arms Control and
Disarmament Agency; and other interested congressional committees. 
Copies will also be made available to others upon request. 

If you or your staff have any questions concerning this report,
please call me on (202) 512-4128.  Major contributors to this report
are listed in appendix II. 

Sincerely yours,

Joseph E.  Kelley
Director-in-Charge
International Affairs Issues

EXECUTIVE SUMMARY
============================================================ Chapter 0

   PURPOSE
---------------------------------------------------------- Chapter 0:1

Since 1928, an international treaty has banned the use of chemical
weapons but not their development and production.  The number of
countries suspected of having or developing such weapons has
increased to 24.  A new multilateral treaty, the Chemical Weapons
Convention, would require the destruction of chemical weapons and the
means to produce them.  The United States signed the convention in
1993 but has not ratified it yet.  Earlier, the United States signed
bilateral agreements with Russia aimed at destroying both countries'
chemical weapon stockpiles. 

To assist the Senate Committee on Foreign Relations in its
deliberations over ratification of the Chemical Weapons Convention,
GAO evaluated (1) the progress made in implementing the bilateral
agreements with Russia, (2) the status of the Chemical Weapons
Convention, and (3) the costs incurred by the United States in
preparing for and implementing the treaties. 

   BACKGROUND
---------------------------------------------------------- Chapter 0:2

Chemical weapons are instruments of mass destruction that can kill
and maim large numbers of people.  In 1989 and 1990, the United
States and Russia entered into two interrelated agreements aimed at
destroying their chemical weapon stockpiles.  Both countries have
large stockpiles.  A major objective of these agreements was to
facilitate ongoing negotiations on the Chemical Weapons Convention. 

More than 20 years after negotiations began, the convention was
opened for signature in January 1993.  It has been signed by most
countries in the world and now awaits ratification.  The convention
would restrict signatory countries from developing, producing,
acquiring, stockpiling, retaining, transferring, or using chemical
weapons; require the destruction of existing chemical weapon
stockpiles and facilities; control the export of items used in the
production of chemical weapons; and provide for inspections to ensure
compliance.  If ratified by 65 countries, the treaty could enter into
force as soon as January 1995. 

Monitoring implementation of the convention will be an international
agency, the Hague-based Organization for the Prohibition of Chemical
Weapons.  A predecessor organization, the Preparatory Commission, is
working to facilitate the entry into force of the convention and to
establish the permanent agency. 

   RESULTS IN BRIEF
---------------------------------------------------------- Chapter 0:3

Significant technical, political, and financial obstacles have to
date prevented Russia from beginning to destroy its chemical weapons. 
However, Russia and the United States have begun to make progress in
a number of areas.  For instance, the two countries agreed that a
U.S.  contractor will develop a comprehensive plan for the Russian
chemical weapon destruction program.  Nevertheless, much uncertainty
still exists over Russia's ability to safely destroy its chemical
weapons. 

Although most countries have signed the Chemical Weapons Convention,
several key countries suspected of having or developing chemical
weapons have not signed it.  Without their membership, it will be
difficult for the convention to meet its goal of destroying the
world's stockpile of chemical weapons and dismantling the facilities
that make them.  Furthermore, only a small number of signatory
countries have submitted their instruments of ratification.  As a
result, it is unlikely the convention will enter into force at the
earliest possible date of January 1995. 

Among signatory states, the United States has funded the largest and
most ambitious research and development program aimed at helping to
develop an effective international verification regime.  Future plans
call for the United States to spend significantly more resources to
help refine and improve the convention's verification operations. 
However, with the exception of inspector training, no plans exist to
develop an equitable burden-sharing arrangement to distribute at
least a portion of these costs among other signatory states.  Within
the U.S.  government, all three military services have developed
workable methods for providing timely access to installation site
diagrams, which will be needed to comply with the treaties.  However,
the Air Force's approach is much less expensive than that of the Army
and Navy.  Finally, the Arms Control and Disarmament Agency has been
appropriated funds that are in excess of requirements to support the
Preparatory Commission. 

   PRINCIPAL FINDINGS
---------------------------------------------------------- Chapter 0:4

      IMPLEMENTATION OF BILATERAL
      AGREEMENTS HAS PROGRESSED
      SLOWLY
-------------------------------------------------------- Chapter 0:4.1

Under the first U.S.-Russian agreement, signed in 1989, the two
countries are to exchange data on chemical weapon stockpiles and
facilities and verify the data.  The second agreement, signed in
1990, calls for the destruction of most chemical weapons and for
verification inspections.  It lays out a schedule for chemical
weapons destruction, with the requirement that destruction begin by
December 1992. 

The United States and Russia have not implemented key aspects of the
agreements.  The two countries are just beginning the process of
verifying each other's declared chemical weapon stockpiles and
facilities in accordance with the 1989 agreement, as amended.  The
agreement, therefore, was not fully implemented prior to the signing
of the Chemical Weapons Convention as originally planned.  In
addition, the two countries have not finalized or ratified the 1990
destruction agreement.  Russia has not begun to destroy its weapons,
but the United States has started to do so in accordance with a
congressional directive. 

Disputes over the number of verification inspections to be conducted,
verification procedures, and procedures for converting chemical
weapon production facilities to civilian use have delayed Russia's
implementation of the agreements.  Underlying the implementation
problems is Russia's lack of technical and financial resources to
destroy its weapons in a timely and safe manner.  Russia has much
work to do before it can carry out its destruction program. 

In January 1994, however, the two countries began to make progress in
a number of areas.  A U.S.  contractor, funded by the United States,
will assist in developing a comprehensive plan that will lay the
groundwork for Russia's destruction program.  U.S.  officials said
they will use this plan in making decisions on long-range assistance
to Russia.  The United States will also fund an analytical chemical
agent destruction testing laboratory. 

The United States and Germany have been the only two countries to
provide assistance to the Russian chemical weapon destruction
program.  The United States has pledged $55 million and Germany $2.9
million.  Russia, which has stated that it will need $1 billion in
foreign assistance to destroy its chemical weapons, is currently
seeking other donors. 

      IMPEDIMENTS TO THE CHEMICAL
      WEAPONS CONVENTION
-------------------------------------------------------- Chapter 0:4.2

The Chemical Weapons Convention is facing several obstacles that
could hinder its goal of eliminating the production, stockpiling and
use of chemical weapons.  As of December 1993, 154 (80 percent) of
the 192 countries had signed the convention.  However, several
countries suspected of having or developing chemical weapons have not
signed it.  These countries include Egypt, Libya, Iraq, Syria, North
Korea, and Taiwan.  Taiwan is not recognized by the United Nations
and therefore is ineligible to sign the convention. 

In addition, the prospects for early ratification of the convention
are not encouraging.  Sixty-five countries must ratify the convention
and submit their instruments of ratification before it can enter into
force.  The United States has promoted early ratification so that the
treaty can enter into force in January 1995.  The Preparatory
Commission has been operating under the assumption that this target
date will be met.  However, only four signatory countries have
submitted instruments of ratification, and the convention is not
likely to meet its January 1995 entry into force date. 

Many countries are looking to the United States and Russia to ratify
the convention before doing so themselves.  The U.S.  Senate is
expected to hold ratification hearings during the spring of 1994. 
Russia's prospects for early ratification are uncertain because of
the country's changing political situation.  In the meantime, the
U.S.  government is concerned that Russia is now developing new
binary chemical weapons.  When Russia ratifies the Chemical Weapons
Convention, and it enters into force, Russia cannot develop chemical
weapons without being in violation of the convention. 

Further, about half the signatory countries have not paid their
assessed shares of expenses to the Preparatory Commission or
participated in the commission's plenary sessions.  Despite this lack
of support, the commission has established an organizational
framework, recruited staff, and begun to draft regulations and
procedures. 

      U.S.  COSTS ASSOCIATED WITH
      THE CHEMICAL WEAPONS
      TREATIES COULD BE REDUCED
-------------------------------------------------------- Chapter 0:4.3

During the last 5 years, U.S.  agencies have incurred approximately
$166 million in expenses associated with the bilateral agreements
with Russia and the Chemical Weapons Convention.  The agencies plan
to spend another $717 million during the next 6 years.  Expenses
include (1) funds for research and development of verification tools
that the Organization for the Prohibition of Chemical Weapons will
need to conduct effective on-site inspections, (2) the cost of
compliance activities related to preparing for and hosting routine
and challenge inspections and for continuous monitoring of U.S. 
destruction sites by teams of Russian inspectors, (3) the cost of
verification activities related to preparing for and implementing
inspections and continuous monitoring in Russia, (4) the U.S.  share
of Preparatory Commission and Organization for the Prohibition of
Chemical Weapons costs, and the costs associated with establishing
and maintaining a U.S.  National Authority, and (5) grant assistance
to Russia. 

The U.S.  government is missing potential opportunities for cost
savings in three areas.  First, the United States plans to spend $85
million through fiscal year 1999 on continued research and
development efforts to help the Organization for the Prohibition of
Chemical Weapons refine and improve its verification regime in such
areas as inspector training, detection equipment, and on-site
sampling and analysis techniques.  The Preparatory Commission has
developed guidelines on cost sharing between the Secretariat and
member states in the implementation of the proposed general training
program for inspectors.  However, no cost-sharing arrangements have
been developed for the research and development expenditures planned
by the United States. 

Second, the Arms Control and Disarmament Agency was appropriated $2.1
million more than needed to support the Preparatory Commission's
operations, because of a substantial reduction in the commission's
budget.  This money is available for recision.  Further, up to an
additional $2.9 million would be available for recision should the
convention not enter into force by January 1995. 

Third, the Army and Navy are using expensive computer technology to
develop and transmit site diagrams of installations to U.S. 
personnel responsible for meeting inspection teams at a site adjacent
to Washington Dulles airport.  The diagrams will be used in the event
of an international challenge inspection (an unscheduled visit to a
suspected chemical weapon development, production, or storage site). 
While the Army and Navy's approach is workable, it appears to be more
technologically sophisticated than necessary to meet the
requirements.  The Air Force, in contrast, plans to provide site
diagrams at a very low cost by having installations simply fax hard
copies of them as needed for the challenge inspection.  The Army and
Navy combined could save approximately $5.6 million in future
development and maintenance costs over the next 6 years by adopting
the less costly Air Force system. 

   MATTERS FOR CONGRESSIONAL
   CONSIDERATION
---------------------------------------------------------- Chapter 0:5

Congress may wish to consider rescinding that portion of fiscal year
1994 funds appropriated to the Arms Control and Disarmament Agency to
pay for U.S.  support to the Preparatory Commission that is clearly
in excess of the funding required. 

   RECOMMENDATIONS
---------------------------------------------------------- Chapter 0:6

GAO makes several recommendations aimed at reducing the costs to the
United States of implementing the chemical weapons treaties. 

   AGENCY COMMENTS AND GAO
   EVALUATION
---------------------------------------------------------- Chapter 0:7

As requested, GAO did not obtain written agency comments.  However,
GAO discussed the results of its work with program officials from the
Departments of State, Defense, and Energy, and the Arms Control and
Disarmament Agency.  They generally agreed with the report
presentation, but did not accept GAO's recommendations on ways to
reduce costs.  GAO believes, however, that savings are achievable
without degrading the implementation of the verification regime. 

INTRODUCTION
============================================================ Chapter 1

Chemical weapons are instruments of mass destruction that can kill
and maim large numbers of people.  Their use is prohibited under an
international accord which has been in effect for most of this
century.  The accord, however, has done very little to stop the
proliferation of chemical weapons.  In the last 10 years the number
of countries having or suspected of developing chemical weapons has
increased almost fivefold. 

   CHEMICAL AGENTS AND MUNITIONS
---------------------------------------------------------- Chapter 1:1

The two most common chemical agents in chemical weapons are nerve
agents and mustard agents.  Nerve agents can disrupt the nervous
system and lead to loss of muscular control and death.  Mustard
agents blister the skin and can be lethal in large amounts.  The
agents can be delivered in a variety of munitions, including bombs,
artillery rounds, rockets, grenades, missiles, and aerial sprays. 

   THE 1925 GENEVA PROTOCOL
---------------------------------------------------------- Chapter 1:2

More than 140 countries, including the United States, have signed the
1925 Protocol for the Prohibition of the Use in War of Asphyxiating
Poisonous, or Other, Gases and Bacterial Methods of Warfare, known as
the Geneva Protocol.  The protocol, which entered into force in 1928,
bans the use of chemical weapons.\1 However, it does not ban the
development, production, and stockpiling of such weapons, and they
have proliferated to many countries.  Whereas a decade ago 5
countries were thought to have chemical weapons, today at least 24
are suspected of either having or developing them. 

--------------------
\1 The United States ratified the treaty in 1975 with the reservation
that preserves the right of the United States to respond in kind to a
chemical weapons attack.  Several other countries attached a similar
reservation.  The United States will retain a chemical weapons
retaliatory policy until the Chemical Weapons Convention enters into
force, at which time it plans to forswear the use of chemical weapons
for any reason. 

   CHEMICAL WEAPON STOCKPILES
---------------------------------------------------------- Chapter 1:3

There is no accurate accounting of the world's stockpile of chemical
weapons.  Only the United States, Iraq, and Russia have made
stockpile declarations.  The United States has approximately 31,000
agent tons of chemical weapons stored in nine locations.  Destruction
of the weapons began in July 1990 at Johnston Atoll in the Pacific. 
Under current U.S.  plans, destruction facilities will eventually
operate at all the storage locations. 

In 1991, Iraq stated to the United Nations that it had 46,000 pieces
of filled chemical munitions, 79,000 unfilled pieces, and 600 tons of
bulk chemical agents.  These weapons are being destroyed under the
supervision of the U.N.  Special Commission for Iraq. 

Russia stated in December 1989,\2 and again in October 1993, that it
had 40,000 agent metric tons, stored in seven locations.  None of the
weapons were reported to have been destroyed (see ch.  2).  In 1986,
Russia built a demonstration destruction facility in Chapayevsk.  It
never opened, however, because of local safety concerns. 

--------------------
\2 The declaration was made by the former Soviet Union.  In 1991, the
Union was dissolved and Russia declared its willingness to accept and
implement fully all the arms control obligations of the former Soviet
Union. 

   AGREEMENTS BANNING AND
   DESTROYING CHEMICAL WEAPONS
---------------------------------------------------------- Chapter 1:4

The United States and Russia have entered into two interrelated
agreements aimed at destroying their chemical weapon stockpiles.  The
first agreement was signed in September 1989 and the second in June
1990.  The 1990 agreement requires approval by the legislative bodies
of both countries. 

A key objective of the bilateral agreements was to support and
facilitate the ongoing negotiations over the international Chemical
Weapons Convention.  Multilateral negotiations on the convention
began in 1968 with the goal of developing a global consensus for
banning the production and use of chemical weapons.  In September
1992, the 39-member Conference on Disarmament reached agreement on
the convention.  The United Nations General Assembly approved it in
November 1992.  The convention was opened for signature on January
13, 1993, and has been signed by most countries in the world and now
awaits ratification
(see ch.  3). 

The convention, if ratified, would restrict members from developing,
producing, acquiring, stockpiling, retaining, transferring, or using
chemical weapons; regulate the export of items used in the production
of such weapons; require the destruction of chemical weapon stocks
and facilities within 10 years (15 years in extraordinary cases); and
provide for intrusive inspections, including challenge inspections to
ensure compliance. 

Monitoring the implementation of the convention will be the
Organization for the Prohibition of Chemical Weapons (OPCW).  A
predecessor organization--the Preparatory Commission--was approved in
conjunction with the signing of the convention.  The main functions
of the Hague-based commission are to facilitate the entry into force
of the convention and to establish the OPCW.  Funding for the
commission is provided through assessed contributions from signatory
countries. 

   LEGISLATED ASSISTANCE FOR
   RUSSIA
---------------------------------------------------------- Chapter 1:5

In 1991, Congress passed the Soviet Nuclear Threat Reduction Act to
reduce the Soviet military threat by cooperating in the destruction
of Soviet nuclear and chemical weapons.  The program is to be funded
by the transfer of up to $400 million in Defense appropriations in
each of fiscal years 1992 and 1993.  In fiscal year 1994, an
additional $400 million was appropriated for these and other
assistance programs to Russia.  The Department of Defense is planning
to use $55 million of these funds to help Russia destroy its chemical
weapons. 

   ROLES AND RESPONSIBILITIES OF
   U.S.  AGENCIES
---------------------------------------------------------- Chapter 1:6

The National Security Council provides overall U.S.  policy direction
for the chemical weapon agreements and will serve as the national
authority for ensuring that declarations are made and inspections are
carried out in a timely manner.  The Arms Control and Disarmament
Agency (ACDA) will serve as the Office of the U.S.  National
Authority and will be responsible for compiling required declarations
and reports, acting as the U.S.  liaison with the OPCW, and providing
administrative support for U.S.  implementing procedures. 
Coordinating implementation is an interagency working group on
chemical matters, with representatives from the Departments of State,
Defense, Commerce, Justice and Energy; ACDA; the Joint Staff; and the
intelligence community. 

   SUPPORT PROGRAM FOR
   VERIFICATION INSPECTIONS
---------------------------------------------------------- Chapter 1:7

The United States has initiated a program to prepare for the
verification inspections to be conducted under the bilateral
agreements with Russia and the convention.  Participating in the
program are various components of the Department of Defense,
including the military services, the Joint Staff, the Defense Nuclear
Agency, and the On-Site Inspection Agency; the Departments of Energy,
Commerce, Justice and State; ACDA; and the intelligence community. 

   OBJECTIVES, SCOPE, AND
   METHODOLOGY
---------------------------------------------------------- Chapter 1:8

We undertook this review to assist the Senate Committee on Foreign
Relations in its deliberations over ratification of the Chemical
Weapons Convention.  Our overall objectives were to examine (1) the
progress made in implementing the bilateral agreements with Russia,
(2) the status of the Chemical Weapons Convention, and (3) the costs
incurred by the United States in preparing for and implementing the
agreements. 

We obtained documents from and interviewed officials at ACDA and the
Departments of State, Energy, and Defense.  At ACDA we discussed U.S. 
policy on chemical weapons, problems encountered in implementing the
bilateral agreements, and U.S.  support for the Preparatory
Commission.  We obtained the views of State Department officials on
the progress of the bilateral agreements and on Germany's assistance
program to Russia relative to chemical weapons destruction.  At
Energy we obtained information on research efforts being conducted to
support verification inspections. 

At the Department of Defense we met with officials from the Office of
the Secretary of Defense; the Army's Chemical Materiel Destruction
Agency, Chemical Research Development and Engineering Center, and
Executive Agent for Chemical Treaty Compliance; the Defense Nuclear
Agency; the Navy's Theater Nuclear Warfare Program; the Air Force's
Office of National Security Negotiations; the On-Site Inspection
Agency; and the Defense Intelligence Agency.  Among the topics of
discussion were U.S.  policies and implementing procedures for
assistance provided under the Soviet Nuclear Threat Reduction Act,\3
research efforts conducted in support of verification inspections,
data on Russia's chemical weapon stocks, and the verifiability of the
convention. 

We also met with officials from the Chemical Manufacturers
Association to obtain their estimates of the cost the chemical
industry will incur in complying with the Chemical Weapons
Convention.  A senior associate from the Henry Stimson Center
provided us background information on the Chemical Weapons Convention
and discussed the progress being made by the Preparatory Commission. 

We visited the Hague to interview officials at the Preparatory
Commission and staff at the U.S.  delegation office.  In Bonn, we met
with an official from the German Foreign Affairs Ministry to discuss
that country's assistance to Russia.  In Moscow, we interviewed the
Chairman of Russia's Presidential Committee on Conventional Problems
of Chemical and Biological Weapons and the Arms Control Director at
the Ministry of Foreign Affairs.  These discussions centered on
Russian plans to implement the bilateral agreements and the
convention, their perspective on using the assistance offered by the
United States, and the cost of destroying Russia's chemical weapons. 
We also met with U.S.  Embassy officials and representatives of the
U.S.  Chemical Weapons Destruction Support Office. 

We performed our review between April 1993 and January 1994 in
accordance with generally accepted government auditing standards.  As
requested, we did not obtain written agency comments.  However, we
discussed the results of our work with program officials from the
Departments of State, Defense, and Energy, and ACDA.  Their comments
and our evaluation are discussed in the report. 

--------------------
\3 Currently called the Cooperative Threat Reduction Act. 

IMPLEMENTATION OF U.S.-RUSSIAN
AGREEMENTS HAS PROGRESSED SLOWLY
============================================================ Chapter 2

The United States and Russia have not implemented key aspects of
their bilateral agreements on chemical weapon destruction.  The two
countries are just beginning the process of verifying each other's
declared chemical weapon stocks and facilities in accordance with the
1989 agreement, as amended.  Therefore, this agreement was not fully
implemented prior to the signing of the Chemical Weapons Convention
as originally planned.  In addition, the United States and Russia
have not finalized their 1990 agreement, which layed out a schedule
for chemical weapon destruction, and Russia has not begun to destroy
its chemical weapons. 

Disputes over the number of verification inspections to be conducted,
verification procedures, and procedures for converting chemical
weapon production facilities to civilian use have delayed
implementation of the agreements.  Underlying the implementation
problems is Russia's lack of technical and financial resources to
destroy its weapons in a timely and safe manner.  Russia has much
work to do before it can carry out its destruction program.  In
January 1994, however, the two countries began to make progress in
reaching agreement on a number of areas. 

   BILATERAL AGREEMENTS ON
   CHEMICAL WEAPONS DESTRUCTION
---------------------------------------------------------- Chapter 2:1

The 1989 agreement between the United States and Russia consists of
two phases.  In the first phase, the countries are to exchange
general data on their chemical weapons and make reciprocal visits to
storage, production, and destruction facilities.  In the second
phase, the countries are to exchange detailed data on their chemical
weapon stocks and verify this information through reciprocal on-site
inspections.  During this phase, each country is to provide the other
with general plans for dismantling chemical weapon production
facilities. 

The 1990 agreement calls for the destruction of most chemical weapons
and for verification inspections.  It states that each country is to
begin destroying chemical weapons no later than December 1992 and
complete the destruction of most weapons within 10 years. 

At the time the agreements were formulated, one key objective was to
facilitate negotiations on an international treaty--the Chemical
Weapons Convention--to ban the production and use of chemical
weapons. 

   STATUS OF IMPLEMENTATION
---------------------------------------------------------- Chapter 2:2

The first phase of the 1989 agreement was completed in early 1991. 
During this phase, the United States and Russia conducted three
reciprocal visits to chemical weapon facilities and exchanged overall
chemical weapons data. 

The second phase of the 1989 agreement was delayed because of
disputes between the two countries.  They initially agreed to an
implementation plan in March 1993, but the agreement broke down when
Russia raised objections to the plan and proposed several changes,
mainly concerning the number of inspections to be conducted. 
Negotiations were reopened in November 1993, and a final
implementation plan was signed on January 14, 1994. 

Under this implementation plan, the countries are to begin exchanging
detailed chemical weapon data 90 days after the signing date.  The
data exchange is to be completed 30 days later (or 45 days if
additional time is necessary to resolve ambiguities).  Five
verification inspections by each country are scheduled.  The first
inspection--a trial challenge inspection--is to begin not earlier
than 180 days after the signing date.  The remaining four inspections
are to begin not earlier than 225 days after the signing date and are
to conclude 300 days after the signing date, which will be in
November 1994.\1 Until then, the United States will not have
completed its verification of Russia's declared chemical weapon
stocks through on-site inspections. 

The 1990 destruction agreement has not been finalized and ratified. 
The principal issue holding up completion of the agreement concerns
the conversion of former chemical weapon production facilities.  In
March 1993, the negotiators for the two countries reached an accord
on verification procedures and on procedures for converting these
facilities to civilian use so that they could no longer be used to
produce chemical weapons.  The Russian government subsequently
rejected the agreement, stating that it wanted more latitude in the
conversion process.  Negotiations are continuing.  A final agreement
will include new milestone dates for starting and completing the
destruction process. 

Russia missed the agreement's December 1992 original target date for
starting its destruction program.  Currently, it has no comprehensive
plan defining when and how the weapons will be destroyed. 

--------------------
\1 The four inspections include two routine inspections and two
challenge inspections.  A routine inspection is a systematic
examination of potential chemical weapon storage or production
facilities declared by the host country.  A challenge inspection is a
nonscheduled visit to a suspected chemical weapon development,
production, or storage site.  The purpose of the trial inspection is
to develop procedures for conducting the subsequent challenge
inspections. 

   RUSSIA LACKS THE TECHNICAL AND
   FINANCIAL RESOURCES TO CARRY
   OUT ITS DESTRUCTION PROGRAM
---------------------------------------------------------- Chapter 2:3

According to U.S.  and Russian officials, Russia cannot safely
destroy its chemical weapons using its current facilities and may not
have appropriate technology.  A massive infusion of money and
technology will be needed to upgrade Russia's capabilities.  The two
countries, in January 1994, agreed that a U.S.  contractor would be
hired to develop a comprehensive plan for Russia's destruction
program.\2

--------------------
\2 While the United States has started to destroy its chemical
weapons, it has experienced technical difficulties that have resulted
in slippage of its destruction schedule.  See Chemical Weapons
Destruction:  Issues Affecting Program Cost, Schedule, and
Performance (GAO/NSIAD-93-50, Jan.  21, 1993) and Chemical Weapons: 
Stockpile Destruction Cost Growth and Schedule Slippages Are Likely
to Continue (GAO/NSIAD-92-18, Nov.  20, 1991). 

      ESTIMATED COSTS FOR THE
      RUSSIAN DESTRUCTION PROGRAM
-------------------------------------------------------- Chapter 2:3.1

Russia estimates that its chemical weapon destruction program will
cost between $5 billion and $6 billion.  The U.S.  program to destroy
its chemical weapons is currently estimated at $8.6 billion. 
Although Russia has more chemical weapons, the weapons reportedly do
not contain explosives charges.  Weapons without explosives charges
should be less costly to destroy.  Russian officials have stated that
upwards of $1 billion in foreign assistance will be required for the
destruction program. 

      U.S.  ASSISTANCE TO THE
      RUSSIAN DESTRUCTION PROGRAM
-------------------------------------------------------- Chapter 2:3.2

The United States and Russia signed an agreement in July 1992 whereby
the United States would provide up to $25 million in chemical weapons
destruction assistance to Russia.  Most of the funds are to be used
to develop a comprehensive destruction plan.  An additional $30
million was offered to assist Russia in developing an analytical
chemical weapons destruction laboratory in Moscow. 

In addition, a Department of Defense official told a congressional
committee in March 1994 that to spur Russian chemical weapons
destruction, the United States is prepared to provide $300 million or
more to help build a pilot destruction plant.  The plant would take 8
years or longer to complete.  This U.S.  assistance would be
conditioned on Russia's agreeing to destroy its most modern chemical
weapons bombs at the plant. 

As of the end of 1993, only $2.7 million of the $55 million in
reserved funds had been obligated or spent.  These funds were used
for the establishment of a field office in Moscow, translation
services, development of an English-Russian technical language
dictionary related to chemical weapons terminology, travel, technical
exchanges, training, and Army Corps of Engineers support. 

The United States insisted that before it obligates most of the
funds, a specific plan be established for exchanging detailed data on
chemical weapon stocks.  The detailed technical data is considered
necessary for developing a comprehensive plan and estimating the cost
for the destruction program. 

Further, the U.S.  assistance programs to Russia are contingent on
Russian treaty compliance.  To receive the assistance under the 1991
act, Russia must be in compliance with all relevant arms control
agreements.  When the Chemical Weapons Convention enters into force,
and if the 1990 bilateral destruction agreement is approved, Russia
can no longer develop or produce chemical weapons without violating
the treaties.  Currently, there is concern within the U.S. 
government that Russia is developing binary chemical weapons.  ACDA,
for example, stated that the United States has serious concerns that
a viable Russian chemical weapons research, development, testing and
evaluation program is continuing and that Russia has not responded
satisfactorily to these U.S.  concerns. 

      RECENT PROGRESS HAS BEEN
      MADE IN A NUMBER OF AREAS
-------------------------------------------------------- Chapter 2:3.3

In January 1994, Russia and the United States agreed to a joint 1994
work plan that calls for hiring a U.S.  contractor to develop a
comprehensive plan for the destruction program.  Among other aspects
the plan is expected to form the basis for determining when and how
the destruction program can proceed and the types of financial and
technical assistance Russia will require.  U.S.  officials said they
will use the plan in making decisions on long-range U.S.  assistance
to the Russian destruction program. 

Upon signing the work plan, Russia will also receive the financing
for the chemical agent testing laboratory.  The laboratory agreement
is expected to be signed in mid-March 1994.  This laboratory is
expected to (1) develop analytical methods and quality control
measures, (2) conduct environmental baseline studies, and (3) train
scientists and technicians to help protect the environment while
destroying chemical weapons.  Russia has requested that the
laboratory be located at the Vernodsky Institute of Geochemical
Analytical Chemistry in Moscow and that the funds be used to purchase
equipment and to refurbish facilities. 

The work plan also provides for the development of a program
management system which will be used to develop cost estimates, a
comprehensive public outreach and education program for the Russian
people, the establishment of design criteria for destruction
facilities, and the continuation of some programs previously agreed
to, such as developing a technical language dictionary. 

      OTHER FOREIGN ASSISTANCE
-------------------------------------------------------- Chapter 2:3.4

Besides the United States, only one other donor--Germany--has
committed funds to Russia's chemical weapon destruction program. 
Russia and Germany signed an agreement in December 1992 whereby
Germany made a commitment to help Russia destroy some of its nuclear
and chemical weapons.  In accordance with the agreement, a joint
Russian-German commission was established in June 1993 with the
responsibility of monitoring the implementation of the destruction
program.  In fiscal year 1993, Germany provided $2.9 million to help
finance the destruction of mustard and lewisite agents and to explore
the feasibility of extracting arsenic from the lewisite for
commercial purposes.  The work is being performed by two German
companies.  A German official said if the initial German efforts are
successful and the Russian political situation stabilizes, then
German assistance is expected to increase in future years. 

Russia is also seeking assistance from other sources.  The Chairman
of Russia's Presidential Committee on Conventional Problems of
Chemical and Biological Weapons said he has requested assistance from
Sweden, France, Switzerland, and the North Atlantic Treaty
Organization.  He hopes assistance also will be provided by the
International Monetary Fund, the European Bank for Reconstruction and
Development, and the European Community.  In addition, the Chairman
has contacted several private U.S.  firms with the hope that the U.S. 
government will finance their assistance efforts.  To date, no
additional assistance has been provided. 

      ASSISTANCE EFFORTS ARE NOT
      COORDINATED
-------------------------------------------------------- Chapter 2:3.5

German and U.S.  officials have informally discussed their respective
programs, but the two programs are essentially independent.  Indeed,
there appear to be no efforts to coordinate assistance from current
and potential donors.  Russian officials have stated that they see no
need to create an organization to coordinate their assistance
efforts. 

   CONCLUSIONS
---------------------------------------------------------- Chapter 2:4

Russia has not started the destruction of its chemical weapons and
currently has no comprehensive plan that defines when and how the
weapons will be destroyed.  The 1989 agreement has not been fully
implemented as originally planned, and the 1990 destruction agreement
has not been finalized and ratified.  Because the two bilateral
agreements have not been implemented as planned, the Chemical Weapons
Convention did not receive the full benefits as originally
anticipated when the agreements were entered into. 

The costs to destroy Russian chemical weapons is another deterrent to
timely program implementation.  The recent agreement between the two
countries, whereby a U.S.  contractor will assist in developing a
comprehensive chemical weapons destruction plan for Russia, should
form the basis for determining when and how the destruction program
can proceed and the types of financial and technical assistance
Russia will require. 

If the bilateral destruction agreement or the Chemical Weapons
Convention (with Russian ratification) enters into force, and the
United States still believes Russia is developing binary chemical
weapons, then U.S.  assistance to Russia's chemical weapons
destruction program could not be legally continued.  Since neither
the bilateral destruction agreement nor the convention has entered
into force, Russia is not in violation of its existing obligations. 

IMPEDIMENTS TO THE CHEMICAL
WEAPONS CONVENTION
============================================================ Chapter 3

The Chemical Weapons Convention is facing several obstacles that
could hinder its goal of eliminating the production, stockpiling, and
use of chemical weapons.  Several countries suspected of having or
developing chemical weapons have not signed the convention.  In
addition, the prospects for early ratification of the convention are
not encouraging.  Only four signatory countries have submitted
instruments of ratification, and the convention is unlikely to meet
its entry-into-force target date of January 1995.  Further, about
half the signatory countries have not paid their assessed shares of
expenses to the Preparatory Commission or participated in the
commission's plenary sessions. 

   CONVENTION MEMBERSHIP
---------------------------------------------------------- Chapter 3:1

One of the Conference on Disarmament's objectives in drafting the
convention was to obtain universal membership.  As of December 1993,
154 (80 percent) of the 192 countries of the world had signed the
convention.  Among the non-signatory countries were Egypt, Libya,
Iraq, Syria, North Korea, and Taiwan.\1 All these countries are
suspected of having or developing chemical weapons. 

As an inducement to countries to sign and ratify the convention, the
convention will prohibit transfers of many chemicals with dual
military and civilian uses to nonmembers.  Transfers of other
dual-use chemicals will be permitted only under restrictive
conditions.  These restrictions should help ensure that nonmember
countries do not receive controlled chemicals that can be used to
make chemical weapons.  The restrictions, however, will also affect
non-signatory countries' legitimate industrial needs.  In addition,
the members of the Australia Group\2 have adopted export controls on
certain chemicals and equipment to impede the production of chemical
weapons. 

--------------------
\1 Taiwan is not recognized by the United Nations and therefore is
ineligible to sign the convention. 

\2 The 25-member Australia Group was established in 1984 to
discourage and impede the proliferation of chemical weapons, mainly
through the harmonization of export controls on chemicals and, more
recently, on equipment that can be used to make chemical weapons. 
The group also controls biological organisms, toxins, and equipment
that can be used to make biological weapons. 

   UNFAVORABLE PROSPECTS FOR EARLY
   RATIFICATION
---------------------------------------------------------- Chapter 3:2

The convention will enter into force 180 days after 65 countries have
ratified it, although it cannot go into effect before January 13,
1995.  The presidents of the United States and Russia, in a January
1994 joint statement, declared their intention to promote treaty
ratification as rapidly as possible and entry into force of the
convention not later than 1995.  The Preparatory Commission has
operated under the assumption that the convention will go into effect
in January 1995. 

Early ratification, however, appears improbable.  As of December
1993, only Sweden, Fiji, Mauritius, and the Seychelles had deposited
instruments of ratification with the United Nations.  Saudi Arabia,
Norway, and Oman have ratified the convention but have not deposited
their instruments of ratification. 

We were told that many countries were looking to the United States
and Russia to ratify the convention before doing so themselves.  In
the United States, the convention was submitted to the Senate for
ratification in November 1993.  The Senate is expected to hold
ratification hearings during the spring of 1994.  Russia's prospects
for early ratification are uncertain because of the changing
political situation.  In addition, Russian officials have stated that
receiving $1 billion in foreign assistance and finalizing the 1990
bilateral destruction agreement are essential to their ratification
of the convention.  As discussed in chapter 2, Russia has been
promised only about $58 million so far, and the United States and
Russia have not finalized or ratified the bilateral destruction
agreement. 

If 65 countries ratify the convention and it enters into force
without the United States, Russia, or both, the ratifying countries
would be responsible for all of the OPCW's operating costs. 
Currently, the United States and Russia together pay about 32 percent
of the Preparatory Commission's costs.  In addition, in accordance
with the convention, U.S.  and Russian staff on the Preparatory
Commission, including several in key positions, could not become OPCW
employees.  A loss of either funding or key personnel could slow
progress in fully implementing the convention. 

   STATUS OF THE PREPARATORY
   COMMISSION
---------------------------------------------------------- Chapter 3:3

Since its inception in February 1993, the Preparatory Commission has
established an organizational framework, developed a budget,
recruited staff, and begun to draft regulations and procedures for
the OPCW.  However, it has lacked support from many signatory
countries. 

      ORGANIZATION AND BUDGET
-------------------------------------------------------- Chapter 3:3.1

The Preparatory Commission consists of a chairman (rotated every 6
months), an executive secretary who heads the Provisional Technical
Secretariat (the organization's staff), and two working groups.  The
Secretariat comprises five divisions:  verification, external
relations, technical cooperation and assistance, legal, and
administration.  The two working groups--one for budget and
administration and the other for verification, technical cooperation,
and assistance--are assisted by about 15 groups of experts provided
by about 20 countries.  In 1993, the commission met in plenary
sessions five times. 

The commission's budget for 1993 was $8.8 million.  It has budgeted
$29.7 million for 1994 based on the assumptions that (1) the Chemical
Weapons Convention will enter into force in January 1995, (2) Russia
and the United States will implement their 1990 agreement to destroy
their chemical weapons in 1994, and (3) Russia and the United States
will ratify the convention in 1994. 

      STAFFING
-------------------------------------------------------- Chapter 3:3.2

The Provisional Technical Secretariat had 66 staff members in 1993. 
This figure includes nine staff, including two from the United
States, who were loaned to the Secretariat for several months, but it
does not include the experts assisting the working groups, who were
provided at no cost to the commission by member countries.  The
staffing is expected to increase to 225 in 1994. 

A list of 34 key personnel as of mid-December 1993 indicates that 25
countries were represented.  Four Americans held key positions,
including one U.S.  citizen who was serving as director of the
Secretariat's administration division.  Three citizens each from
Russia and the United Kingdom held key positions. 

      REGULATIONS AND PROCEDURES
-------------------------------------------------------- Chapter 3:3.3

In laying the groundwork for the OPCW, the Preparatory Commission
approved financial regulations and an external auditor.  Work in such
areas as the development of staff rules and various verification
procedures is continuing. 

      LACK OF SUPPORT FROM MANY
      SIGNATORY COUNTRIES
-------------------------------------------------------- Chapter 3:3.4

The Preparatory Commission has made progress despite receiving little
support from many signatory countries.  As of December 1993, 71 (46
percent) of the 154 signatory countries had not paid any of their
1993 assessments.\3 Another 12 members (8 percent) made only partial
payments.  In addition, attendance at the Preparatory Commission's
five plenary sessions in 1993 ranged from a high of 66 percent at the
first session to 52 percent at the last session.  At these sessions,
all important decisions affecting the commission are discussed for
approval or rejection. 

--------------------
\3 Two countries--Lithuania and Vietnam--formally stated that they
would not pay their assessments. 

   CONCLUSIONS
---------------------------------------------------------- Chapter 3:4

Although 80 percent of the world's countries have signed the Chemical
Weapons Convention, only a few have ratified it.  Moreover, a number
of key countries suspected of having or developing chemical weapons
have not signed. 

The low attendance of members at Preparatory Commission meetings and
the large number of countries that have not paid their Preparatory
Commission assessment provide some evidence that interest in directly
supporting Chemical Weapons Convention objectives is not high.  Given
these factors, meeting the January 1995 target date for entry into
force will be difficult.  U.S.  and Russian ratification of the
Chemical Weapons Convention appears critical to obtaining
ratification support from other members. 

U.S.  TREATY IMPLEMENTATION COSTS
COULD BE REDUCED
============================================================ Chapter 4

Over an 11 year period, the United States has spent or plans to spend
almost $900 million to support the bilateral chemical weapons
agreements with Russia and the Chemical Weapons Convention.\1 Our
review indicated that some of these costs could be reduced since the
U.S.  government is missing potential opportunities for cost savings
in three areas.  First, the United States has not asked the
Preparatory Commission to help pay for future research and
development expenditures designed to support the OPCW's verification
regime.  Second, because the Preparatory Commission's budget was
substantially reduced in 1994, ACDA's appropriation for the U.S. 
assessment to the Preparatory Commission is excessive.  Third, the
Army and Navy have adopted a costly computerized site diagram program
which does not appear to be needed.  (See appendix I for a detailed
description of incurred and planned implementation costs.)

--------------------
\1 It is currently estimated that another $8.6 billion will be spent
to destroy the U.S.  chemical weapons stockpile.  Additional costs
are expected to be incurred in (1) examining alternative technologies
for destroying the U.S.  stockpile and (2) destroying non-stockpile
items such as former U.S.  production facilities and buried
munitions. 

   PLANNED RESEARCH AND
   DEVELOPMENT COSTS COULD BE
   REDUCED
---------------------------------------------------------- Chapter 4:1

Between fiscal years 1994 and 1999, the Defense Nuclear Agency, the
Department of Energy,\2 and ACDA plan to spend a total of almost $85
million on follow-on research and development projects.  These
expenditures are in addition to the $98.7 million already spent by
these agencies on research and development efforts from fiscal years
1989 through 1993 to support the Preparatory Commission's
verification regime.\3 Until recently, there was no mechanism in
place to provide for sharing the burden of these expenses. 

The comprehensive program of research and development conducted by
the United States far exceeds the efforts of any other member state. 
The United States took a leadership role in developing a verification
system since its resources and expertise in the chemical weapons
field significantly exceeds that of any other member state, with the
possible exception of Russia.  Several other industrialized member
states, however, have provided support through national trial
inspections and selected research in such areas as non-destructive
evaluation techniques and inspector training. 

The $85 million in planned U.S.  expenditures will be spent on a wide
range of projects, including inspector training; assorted studies and
evaluations; and research and development projects aimed at refining
and improving the OPCW's inspector training, verification equipment,
and sampling techniques.  According to a U.S.  Army official, these
projects should increase inspection effectiveness and enhance the
protection of sensitive or classified non-chemical weapons
information.  Examples of planned research and development are
efforts to produce a real time safety monitor for inspectors, a
portable poisonous gas detector, and an improved portable lab system. 

The Preparatory Commission does not intend to include a line item in
its budget to cover the costs of follow-on research and development
efforts.  The Preparatory Commission has, however, established a
small training budget in its 1994 budget which will allow for the
limited renumeration of the costs incurred by member states that
elect to provide OPCW inspector training. 

In the past, when the United States conducted research activities to
assist the development of a verification regime for the Chemical
Weapons Convention, there was no organization in place that could
concur with or reimburse U.S.  research efforts.  This situation
changed with the establishment of the Preparatory Commission in
February 1993. 

If an agreement could be reached on the type and extent of research
and development activities needed to support the OPCW's future
operations, the Preparatory Commission (and subsequently the OPCW)
could include a line item in its annual budget for such activities. 
If it was agreed that the entire U.S.  budget of $85 million was
appropriate, the United States over a 6-year period could potentially
save approximately $64 million in planned research and development
activities since the United States is assessed 25 percent of the
Chemical Weapons Convention's costs. 

--------------------
\2 The Department of Energy's program is scheduled to be closed out
by the end of fiscal year 1994 due to a congressionally mandated cut
in funding from $4.2 million to $1.4 million. 

\3 Program officials pointed out that while U.S.  research and
development efforts are primarily geared towards supporting the
Chemical Weapons Convention, these efforts also have application to
the verification activities to be conducted under the bilateral
destruction agreement with Russia. 

   EXCESS FUNDS APPROPRIATED FOR
   THE U.S.  CONTRIBUTION TO THE
   PREPARATORY COMMISSION
---------------------------------------------------------- Chapter 4:2

In fiscal year 1993, the United States contributed $2.2 million to
the Preparatory Commission, or approximately 25 percent of the
commission's first-year operating budget.  Congress appropriated $9.5
million for the U.S.  assessment in fiscal year 1994; however, due to
a significant reduction in the Preparatory Commission's 1994 budget,
the maximum expected U.S.  assessment will be only $7.4 million.  As
a result, $2.1 million in ACDA funds will be available for recision. 

Furthermore, if the convention fails to enter into force by January
1995 as planned, the Preparatory Commission will not need all the
funds it has budgeted and the U.S.  assessment would be reduced by as
much as another $2.9 million.  Thus, excess funds could total as much
as $5 million. 

ACDA officials said they plan, with congressional approval, to
reserve the amount appropriated in excess of the expected $7.4
million assessment for a number of contingencies.  These
contingencies include (1) providing an advance to the commission to
meet unanticipated expenses or shortfalls due to signatories not
meeting their assessments and (2) funding start-up costs for the U.S. 
Office of National Authority.  The officials made no comment on plans
for using the additional excess funds should the convention not enter
into force by January 1995. 

   ARMY AND NAVY ADOPT A COSTLY
   SITE DIAGRAM PROGRAM
---------------------------------------------------------- Chapter 4:3

To prepare for the international regime's challenge inspections of
chemical weapons production, storage, and destruction facilities, the
U.S.  Army, Navy, and Air Force have each developed a treaty
compliance program.  Among their responsibilities, the services will
provide site diagrams of their installations in the event of a
challenge inspection.  The Army and Navy have computerized their site
diagrams in a central location.  The Air Force, in contrast, will
have installations transmit hard copies of the site diagrams by
facsimile machine.  Although the Air Force's approach is less
sophisticated, it meets the requirements at little cost to the
government since each installation is already required to maintain a
site diagram for other purposes. 

      SITE DIAGRAMS USED IN
      NEGOTIATIONS WITH OPCW TEAMS
-------------------------------------------------------- Chapter 4:3.1

For a challenge inspection, U.S.  officials will meet the OPCW
inspection team at the U.S.  port of entry--Washington Dulles
International Airport--and provide a work area for the inspectors. 
Within 24 hours of the team's arrival, the United States is obliged
to either reach agreement on an inspection perimeter or propose an
alternative perimeter which establishes the sections of the
installation that inspectors will be granted access to.  Accurate
site diagrams will be essential to help U.S.  officials conclude
these negotiations in an effective and timely manner.  The site
diagrams will also be used to negotiate access to sensitive areas
once the inspectors arrive at the installation. 

      TWO APPROACHES USED TO
      DEVELOP AND TRANSMIT SITE
      DIAGRAMS
-------------------------------------------------------- Chapter 4:3.2

All three services have developed methods for providing timely access
to their site diagrams.  The Army and the Navy have established a
computerized site diagram program at the Navy's installation at
Indian Head, Maryland,\4 which is inputting data from approximately
800 different Navy and Army facilities.  When an installation is to
be inspected, site diagram data will be downloaded to a lap top
computer and a hard copy will be printed out for use by U.S. 
officials meeting the inspection team at Dulles Airport and by the
support team sent to the challenged site. 

The cost of this approach, including system development, procurement,
and data entry costs, amounted to $2.3 million through fiscal year
1993.  Data entry and system maintenance costs are estimated to be
about $6.9 million from fiscal years 1994 through 1999. 
Approximately $1.3 million of the $6.9 million will have been spent
by the end of March 1994, thus leaving a balance of $5.6 million. 

The Air Force is not computerizing or centralizing its site diagrams. 
Instead, when an installation is the subject of a challenge
inspection, installation officials will cut a copy of an up-to-date
site diagram into strips and fax it to U.S.  officials who are to
meet the visiting inspectors at Dulles Airport.  The strips will then
be reassembled for use in the negotiations.  While less sophisticated
than the Army and Navy's approach, the Air Force's approach appears
to be sufficient.  The Air Force official responsible for the program
told us he tested the concept and it proved to be workable. 

Army and Navy officials provided various reasons to support their use
of computerized site diagrams.  For example, Army officials said (1)
about five percent of Army site diagrams are on blue line paper which
cannot be readily duplicated, (2) a limited number of sites have
diagrams which number in the tens of pages and could prove cumbersome
to fax, and (3) inspection perimeter lines can be drawn with greater
accuracy on computerized diagrams. 

Navy officials said (1) computerization allows for uniform and more
accurate site diagrams, (2) the computers can store historical data
on chemical weapon activities that may have existed at the
installation, and (3) centralization of records creates a needed
focus for the program and will allow a Washington-led team to provide
competent on-site guidance during an inspection. 

We agree that in limited cases the faxing of site diagrams may not
prove feasible.  However, Army and Navy officials acknowledged that
the hard copies of site diagrams maintained in the Washington area
contain essentially the same information as computerized site
diagrams and could be used in negotiations with inspection teams.\5

--------------------
\4 Located approximately 30 miles from Washington. 

\5 The Army maintains hard copies at the installations, Indian Head,
and a contractor facility in Aberdeen, Maryland.  The Navy maintains
hard copies at the installations, Indian Head, and the Naval Facility
Engineering Command in Washington. 

   CONCLUSIONS
---------------------------------------------------------- Chapter 4:4

U.S.  plans call for $85 million more to be spent on research and
development efforts designed primarily to refine and improve the
convention's verification regime.  These unilateral expenditures are
voluntary and are aimed mainly at supporting the OPCW, although they
also support the bilateral destruction agreement with Russia.  A key
question to consider now is whether the United States should continue
paying for all such efforts without first seeking to obtain support
funding from the OPCW.  We recognize that member states may not be
able to support the entire U.S.  research effort.  Given that the
OPCW is a multilateral organization whose efforts will benefit all
members, it appears reasonable to expect that significantly greater
cost sharing of OPCW activities should be undertaken by other member
countries.  By seeking OPCW funding support, the United States would
also obtain some evidence as to whether the international
organization deems the planned U.S.  research to be of substantive
value to the verification process. 

ACDA has been appropriated $2.1 million more than is needed for
current-year operations to support the Preparatory Commission. 
Additional appropriations amounting to as much as $2.9 million may be
available for recision if the Chemical Weapons Convention does not
enter into force by January 1995. 

With regard to U.S.  compliance efforts, the Navy and Army have
chosen to pursue a site diagram program which has cost millions of
dollars to develop and will require millions of dollars to maintain
and keep operational.  The Air Force has chosen to use a low-cost
option for transmitting site diagrams to Washington.  The Army and
Navy could save about $5.6 million over the next 6 years by adopting
the Air Force system. 

   RECOMMENDATIONS
---------------------------------------------------------- Chapter 4:5

We recommend that the Director, ACDA, and the Secretary of Defense
reach an agreement with the Preparatory Commission (and subsequently
the OPCW) on how the United States can be reimbursed for some of the
costs of U.S.  research and development efforts which directly
support the chemical weapons verification regime. 

We recommend that the Secretary of Defense review the treaty
compliance programs of the military services with the view of
determining and implementing the most cost-effective system for
generating and transmitting site-diagrams in the event of a challenge
inspection. 

   MATTERS FOR CONGRESSIONAL
   CONSIDERATION
---------------------------------------------------------- Chapter 4:6

Congress may wish to consider rescinding that portion of fiscal year
1994 funds appropriated to ACDA to pay for U.S.  support to the
Preparatory Commission that is clearly in excess of the funding
required. 

   AGENCY COMMENTS AND OUR
   EVALUATION
---------------------------------------------------------- Chapter 4:7

In discussing our recommendation on establishing a shared funding
arrangement with the OPCW, a Department of Defense official told us
that the United States would not want to rely on any external funding
to pay for planned research and development efforts.  This official
also doubted that the international community would be willing to pay
for U.S.  research and development costs; however, this theory is
untested since the United States has not sought any type of burden
sharing arrangement to date. 

ACDA officials acknowledged that they have received more money than
needed to pay for the U.S.  share of the Preparatory Commission's
budget, but they want to retain these excess funds for contingencies. 
Our office has traditionally taken the position that funds not needed
for the purposes for which they were provided should be considered
for recision. 

With respect to site diagrams, the Defense official raised no
substantive drawbacks associated with the Air Force system.  However,
he did question whether the Air Force method could be implemented on
a timely basis.  The Air Force, however, has demonstrated that its
system can meet challenge inspection time requirements.  In those
cases where faxing is not practical, hard copies of site diagrams
maintained in the Washington area would be available to conclude
perimeter negotiations. 

INCURRED AND PLANNED EXPENDITURES
=========================================================== Appendix I

Most of the $165.5 million that U.S.  agencies spent between fiscal
years 1989 and 1993 on activities associated with the bilateral
agreements with Russia and the Chemical Weapons Convention went to
research and development efforts (60 percent) and treaty compliance
and verification activities (35 percent).  U.S.  agencies plan to
spend $716.7 million between fiscal years 1994 and 1999, with $462.4
million (or about 65 percent) of that amount going for compliance and
verification activities. 

Tables I.1 and I.2 list annual expenses in the following five program
areas:  (1) funds for research and development of verification tools
that the OPCW will need to conduct effective on-site inspections, (2)
the cost of compliance activities related to preparing for and
hosting routine and challenge inspections, and for continuous
monitoring of U.S.  destruction sites by teams of Russian inspectors,
(3) the cost of verification activities related to preparing for and
implementing inspections and continuous monitoring in Russia, (4) the
U.S.  share of Preparatory Commission and OPCW costs, and the costs
associated with establishing and maintaining a U.S.  National
Authority, and (5) grant assistance to Russia. 

Table I.2 does not include the projected costs to private industry
for complying with the inspection requirements under the convention. 
The Chemical Manufacturers Association roughly estimates that these
costs will total $120 million from calendar years 1994 through 1999. 
ACDA, however, estimates that actual costs to private industry over
the same 6-year period will total about $21 million.  We did not
perform an analysis of these two cost estimates. 

                          Table I.1
           
            Incurred Treaty Implementation Costs,
                     Fiscal Years 1989-93

                    (Dollars in millions)

                                                        Tota
Program area              1989  1990  1991  1992  1993     l
------------------------  ----  ----  ----  ----  ----  ====
Research and development
------------------------------------------------------------
Defense Nuclear Agency       0  $15.  $22.  $22.  $21.  $80.
                                   0     0     5     4     9
Department of Energy      $2.0   2.0   2.7   4.7   5.8  17.2
ACDA                         0   0.1   0.1   0.2   0.2   0.6
============================================================
Subtotal                   2.0  17.1  24.8  27.4  27.4  98.7

Treaty compliance and verification\a
------------------------------------------------------------
Army                         0     0   0.5  15.3  13.0  28.8
Navy                         0     0     0   2.8   7.5  10.3
Air Force                    0     0     0     0   0.1   0.1
On-Site Inspection           0     0   1.0   8.8  11.1  20.9
 Agency
============================================================
Subtotal                     0     0   1.5  26.9  31.7  60.1

Preparatory Commission/OPCW\b
------------------------------------------------------------
U.S. assessment              0     0     0     0   2.2   2.2
U.S. delegation support      0     0     0     0   2.1   2.1
============================================================
Subtotal                     0     0     0     0   4.3   4.3
Grant aid to Russia          0     0     0   1.5    .9   2.4
============================================================
Total                     $2.0  $17.  $26.  $55.  $64.  $165
                                   1     3     8     3    .5
------------------------------------------------------------
\a Army, Navy, and Air Force costs relate only to treaty compliance
activities.  On-Site Inspection Agency costs cover both compliance
and verification activities. 

\b Funding for the Preparatory Commission/OPCW comes from ACDA
appropriations. 

                                    Table I.2
                     
                      Projected Treaty Implementation Costs,
                               Fiscal Years 1994-99

                              (Dollars in millions)

Program area                1994    1995    1996    1997    1998    1999   Total
------------------------  ------  ------  ------  ------  ------  ------  ======
Research and development
--------------------------------------------------------------------------------
Defense Nuclear Agency     $19.0   $17.6   $12.6    $9.6   $11.0   $12.3   $82.1
Department of Energy         1.4       0       0       0       0       0     1.4
ACDA                         0.2     0.2     0.2     0.2     0.2     0.2     1.2
================================================================================
Subtotal                    20.6    17.8    12.8     9.8    11.2    12.5    84.7

Treaty compliance and verification\a
--------------------------------------------------------------------------------
Army                        29.0    39.4    41.7    33.7    29.9    28.6   202.3
Navy                         7.1     4.5     4.9     5.2     4.7     4.7    31.1
Air Force                    1.4     0.5     0.1     0.1     0.1     0.1     2.3
On-Site Inspection          18.0    25.1    31.7    44.2    50.1    57.6   226.7
 Agency
================================================================================
Subtotal                    55.5    69.5    78.4    83.2    84.8    91.0   462.4

Preparatory Commission/OPCW\b
--------------------------------------------------------------------------------
U.S. assessment\c            7.4  20.0\d    20.0    20.0    20.0    20.0   107.4
U.S. delegation support      0.7     0.8       0       0       0       0     1.5
National Authority           0.1     2.0     1.5     1.5     1.5     1.5     8.1
 costs\e
================================================================================
Subtotal                     8.2    22.8    21.5    21.5    21.5    21.5   117.0
Grant aid to Russia         52.6       0       0       0       0       0    52.6
================================================================================
Total                     $136.9  $110.1  $112.7  $114.5  $117.5  $125.0  $716.7
--------------------------------------------------------------------------------
\a Army, Navy, and Air Force costs relate only to treaty compliance
activities.  On-Site Inspection Agency costs cover both compliance
and verification activities. 

\b Funding for the Preparatory Commission/OPCW comes from ACDA
appropriations. 

\c Fiscal year 1995 through 1999 data is based on a rough estimate of
the OPCW's total operating costs provided by the Preparatory
Commission. 

\d ACDA has requested only $14 million in fiscal year 1995 funds for
the U.S.  contribution to the Preparatory Commission/OPCW.  The
balance of funds due will need to come from ACDA's fiscal year 1994
appropriation or a possible supplemental request.  However, if the
Chemical Weapons Convention enters into force after January 1995, the
OPCW's budget will be lower and a smaller U.S.  contribution will be
required. 

\e Fiscal year 1995 through 1999 figures assume no assistance is
received from the Department of Commerce.  With Commerce assistance,
ACDA estimates its annual costs will total $500,000. 

MAJOR CONTRIBUTORS TO THIS REPORT
========================================================== Appendix II

   NATIONAL SECURITY AND
   INTERNATIONAL AFFAIRS DIVISION,
   WASHINGTON, D.C. 
-------------------------------------------------------- Appendix II:1

F.  James Shafer, Assistant Director
Raymond A.  Plunkett, Evaluator-in-Charge
Michael M.  ten Kate, Senior Evaluator
David Black, Evaluator
Thomas W.  Gosling, Editor

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