Defense Management: More Reliable Cost Estimates and Further Planning Needed to Inform the Marine Corps Realignment Initiatives in the Pacific
Released: 2013-06-11T00:00:00


Highlights: section_title: Why GAO Did This Study
paragraphs: DOD has stated that it intends to rebalance its defense posture toward the Asia-Pacific region. Japan hosts the largest U.S. forward-operating presence in this region; the majority of the U.S. forces in Japan are located in Okinawa. The United States and Japan planned to reduce the U.S. military presence on Okinawa by relocating approximately 9,000 Marines. DOD had originally planned to move the Marines only to Guam, but revised its plans in 2012 to include other locations in the Pacific. Congressional committees have directed GAO to examine DOD's initiatives in the Pacific, focusing on planning and costs. This report discusses the extent to which DOD has (1) developed a comprehensive cost estimate for the realignment of Marines, (2) planned for and synchronized other movements to coincide with the realignment, and (3) identified plans to sustain the force until all initiatives are implemented. To address these objectives, GAO reviewed relevant policies and procedures, reviewed and analyzed cost documents related to the realignment initiatives, interviewed DOD officials, and conducted site visits at U.S. military installations in the Pacific.

section_title: What GAO Found
paragraphs: The Department of Defense's (DOD) preliminary cost estimate for its current realignment plan is not reliable, because it is missing costs and is based on limited data. According to DOD officials, DOD has not yet been able to put together a more reliable cost estimate because it will not have specific detailed information on the plan's requirements until the completion of environmental analyses and host nation negotiations. Currently, DOD estimates that it would cost approximately $12.1 billion to implement its realignment plan--not including the Australia segment of the realignment. Still, GAO found that DOD did not include some up-front practices that could have provided a more reliable estimate that are not dependent on the completion of the environmental analyses and host nation negotiations. Specifically, DOD omitted any costs associated with mobility support, a critical component of the implementation, from its cost estimate. Furthermore, although DOD based its cost estimate on several assumptions, there was no evidence DOD conducted analysis needed to determine the reliability of those assumptions. Without a reliable estimate, DOD will not be able to provide Congress and other stakeholders with the information Congress needs to make informed decisions regarding the realignment.

DOD has not developed an integrated master plan for its current realignment plan, and it has not developed a strategy to support the development and oversight of the Japanese construction projects associated with other realignment initiatives. DOD has taken initial steps to develop an integrated scheduling document based on currently known data, but indicated that specific requirements, schedules, and costs cannot be formalized in an integrated master plan until several studies and host nation negotiations are completed, which will take several years. Developing a master plan could enhance the management of the realignment by creating a systematic approach to planning, scheduling, and execution. In addition, DOD has not developed a strategy that identifies the resources needed to support the development of and oversight for these projects. According to best practices, a strategy identifies goals and resources and supports the implementation of a program. Without the information contained in an integrated master plan and a construction support strategy, Congress will be unable to make informed decisions about the order in which it needs to provide funding to support the realignment.

DOD has taken some steps to plan for the sustainment of U.S. forces on Okinawa and Guam, but it has yet to fully identify sustainment needs and costs for both locations during this period. At several installations on Okinawa, some of the infrastructure has severely deteriorated. DOD facilities planning guidance calls for updated facility master plans that capture requirements and propose solutions. On Guam, DOD has been maintaining an inventory of unoccupied family housing that could potentially be used for Marines relocating to Guam. However, DOD has not determined all the costs and benefits of maintaining this housing or the Marines' potential housing requirements--information needed to perform an economic analysis. Without an estimate of the sustainment requirements for Okinawa, the costs for maintaining housing, and the potential Marine requirements for housing on Guam, DOD will be unable to make informed decisions on whether continued investment in sustaining these facilities is warranted.

section_title: What GAO Recommends
paragraphs: GAO recommends that DOD develop more reliable cost estimates and an integrated master plan for the realignment of Marines, develop a mechanism to share annual updates on the status of each, and identify sustainment requirements for affected facilities until realignment initiatives are complete. DOD generally agreed with GAO's recommendations.

section_title: Letter
paragraphs: U.S. economic and security interests are inextricably linked to  developments in the arc extending from the Western Pacific and East  Asia into the Indian Ocean and South Asia, creating a mix of evolving  challenges and opportunities. The Department of Defense (DOD) has  stated that it would tailor its global presence and posture by rebalancing  toward the Asia-Pacific region, emphasizing existing alliances and  expanding networks of cooperation with emerging partners throughout the  region to ensure collective capability and capacity for securing common  interests. One of the United States’ most important allies in the Asia- Pacific region is Japan, which serves as the United States’ most  significant forward-operating location in the region, accommodating  approximately 39,000 U.S. military personnel, 43,000 dependents, and  5,000 DOD civilian employees. The majority of this presence resides in  Okinawa, an island prefecture south of the Japanese mainland that  represents less than 1 percent of Japan’s entire land mass. Although it is  small, Okinawa currently hosts over 25 percent of the U.S. bases in  Japan, and Okinawa’s bases house approximately 8,000 Air Force  personnel and up to 19,000 Marine Corps personnel on any given day. To  balance the importance of this forward presence to both the United States  and Japan with the stated need to reduce the burden on the Okinawa  community, attempts to realign, consolidate, and increase the  sustainability of this presence have been ongoing for nearly two decades.  Most recently, after 6 years of unsuccessful attempts to implement a  realignment plan to move approximately 8,000 Marines and 9,000  dependents from Okinawa to Guam, representatives from the U.S. and  Japanese governments announced in a joint statement issued in April  2012, that they would adjust the plan. The Marine Corps’ current  realignment plan would relocate over 9,000 Marines from Okinawa and  realign Marine forces throughout the Pacific: 4,800 to Guam, 2,700 to  Hawaii, and 2,500 to Australia.

Although the document developed by representatives from the two governments  concerning the original Guam realignment referred to approximately 8,000 personnel, the  Record of Decision for the Guam and Commonwealth of Northern Mariana Islands Military  Relocation referred to approximately 8,600 Marines. See Department of the Army and  Department of the Navy, Record of Decision for the Guam and Commonwealth of the  Northern Mariana Islands Military Relocation (September 2010). assessment of posture initiatives in Japan, Okinawa, and Guam, focused  on planning, costs, long-term financial commitments, and other topics.  We were also directed, in Senate Report 112-173, to assess and identify  the costs associated with the new plan to realign Marine Corps units to  Guam, Australia, and Hawaii. This report examines DOD’s plans and the  costs associated with the most significant of these posture initiatives, the  realignment of Marines off Okinawa, and the effects of this initiative on  the current and future landscapes of Okinawa and Guam. Specifically, we  report on the extent to which DOD has (1) developed comprehensive cost  estimates for the realignment of Marines off Okinawa; (2) planned for and  synchronized other U.S. defense posture movements on Okinawa and  Japan to coincide with the relocation of Marines off Okinawa; and (3)  identified plans to sustain the force until the Marine Corps realignment  and other initiatives are completed.

For each of our objectives, we reviewed relevant policies and procedures,  and collected information by interviewing and communicating with officials  from the Office of the Under Secretary of Defense (Policy) and Office of  the Under Secretary of Defense (Comptroller); the Air Force; the Army;  the Navy; the Marine Corps; the Joint Staff; United States Pacific  Command; and the State Department. We conducted site visits at Pacific  Command and its service components in Hawaii; U.S. Forces—Japan  and its service components; and the U.S. Embassy in Tokyo, Japan; the  U.S. Consulate on Okinawa; and military installations on Guam. To  determine the extent to which DOD has developed comprehensive cost  estimates for the realignment of the Marines, we reviewed DOD’s cost  estimating methodology and planning assumptions and compared them  to the cost estimating guidance in GAO’s Cost Estimating Guide.  Furthermore, we interviewed relevant officials from the Marine Corps,  Pacific Command, U.S. Forces–Japan, Joint Guam Program Office,  Office of the Secretary of Defense, and Office of Economic Adjustment to  determine the validity of the data. To determine the extent to which DOD  has planned for and synchronized other U.S. defense posture movements  in Okinawa and Japan to coincide with the Marine Corps realignment, we  collected relevant planning documentation and interviewed Marine Corps  officials in Washington, Honolulu, and Okinawa. Furthermore, we  compared the data we received from each component within the Marine  Corps to one another, and the data we collected from the Pacific  Command, U.S. Forces–Japan, Joint Guam Program Office, and the  Office of the Secretary of Defense to determine the status of planning  consistencies and synchronization. Finally, to determine the extent to  which DOD has identified a strategy to sustain its current forces on  Okinawa and Guam, we reviewed sustainment planning documentation,  base master plans, and historical host nation support and U.S.  sustainment data for Okinawa. We also interviewed relevant Marine  Corps and Air Force officials in Okinawa to determine sustainment  planning needs and the status of future sustainment funding requests. For  Guam, we interviewed Navy officials to determine the extent to which they  have planned for the sustainment of family housing on Guam, and we  reviewed planning documentation and analyzed current DOD cost data  collection methodologies used by the service.

We conducted this performance audit from November 2011 to March  2013, in accordance with generally accepted government auditing  standards. Those standards require that we plan and perform the audit to  obtain sufficient, appropriate evidence to provide a reasonable basis for  our findings and conclusions based on our audit objectives. We believe  the evidence obtained provides a reasonable basis for our findings and  conclusions based on our audit objectives. Appendix I provides a more  detailed description of our scope and methodology.

This report is one of a series of GAO reports on DOD’s global defense  posture initiatives. Since 2006, we have reported on issues related to  DOD’s overall global posture strategy and management practices, the  military buildup on Guam, the transformation of United States Army and  Navy posture in Europe, the transformation and consolidation of U.S.  defense posture in South Korea and Japan, and the establishment of the  United States Africa Command. Those reports make a number of  recommendations to improve DOD’s management of these efforts and  the information about them that DOD makes available within the  executive branch and to congressional committees. Most recently, in May  2011, we reported on U.S. defense posture in Asia, highlighting the need  for additional cost information and methods for evaluating posture in that  region. See the list of related GAO products at the end of this report.
subsections: section_title: Background
paragraphs: The senior U.S. military authority in the Pacific Area of Responsibility is  the Commander of U.S. Pacific Command. Pacific Command is one of six  U.S. geographic combatant commands. Pacific Command’s area of  responsibility spans roughly half the earth’s surface and encompasses 36  countries, including Australia, China, India, Japan, the Philippines, and  South Korea. The Pacific Command is supported by four service  component commands: U.S. Army Pacific; U.S. Pacific Air Forces; U.S.  Marine Forces, Pacific; and the U.S. Pacific Fleet. Each component  command is generally responsible for its service’s actions and missions  within the Pacific Command area of responsibility and is supported by  subordinate commands, which help support the service’s presence in the  region. For example, U.S. Marine Forces, Pacific, is supported by the III  Marine Expeditionary Force, a large Marine Corps unit forward deployed  to Japan and other parts of Asia, which stands ready to conduct  operations. Also supporting Marines in the Pacific is U.S. Marine Corps  Installations, Pacific, which is responsible for the command and control of  all Marine Corps installations in the region. In Japan, U.S. Forces– Japan—a subunified command under the Pacific Command—supports  U.S. forward presence and ensures bilateral defense cooperation with the  government of Japan. According to U.S. Forces–Japan, it focuses on war  planning, the conduct of joint/bilateral exercises and studies,  administering the Status of Forces Agreement, improving combat  readiness, and enhancing the quality of life of military and DOD civilian  personnel and their dependents. See figure 1 for information on major  U.S. forces and installations in Japan, Okinawa, and Guam; approximate  distances between Guam and other strategic locations in the Pacific; and  U.S. strategic allies in the Pacific.

The U.S.-Japan alliance dates back to the U.S. occupation of Japan after  its defeat in World War II. The alliance is supported by the 1960 Treaty of  Mutual Cooperation and Security and a related Status of Forces  Agreement which today covers about 51,200 U.S. servicemembers,  5,400 DOD civilian employees, and 42,200 dependents in Japan, as of  January 2013. As a result of the treaty, the Status of Forces Agreement,  and related agreements, U.S. forces have the use of nearly 90  installations throughout both mainland Japan and Okinawa, for the  purpose of contributing to the security of Japan and the maintenance of  international peace and security in the region. Under the treaty and Status  of Forces Agreement, the United States is granted the use of facilities and  areas in Japan, with specific facilities and areas to be determined by the  two governments. Generally, according to U.S. Forces–Japan officials,  Japan constructs the facilities, while the United States bears the costs of  maintenance—with each facility typically having a 50-year service life.

One issue that remains at the forefront of the alliance is the realignment  of U.S. forces in Japan. Efforts to realign U.S. forces in Japan date back  to 1995. Discontent among the people of Okinawa regarding the U.S.  military presence led to the establishment of the Special Action  Committee on Okinawa in November 1995 by the Security Consultative  Committee, a bilateral group of high-ranking U.S. and Japanese officials  involved with overall bilateral policy regarding the security relationship  between the two countries. In December 1996, this committee approved  the final report of the Special Action Committee on Okinawa, which  included recommendations on how to consolidate, realign, and reduce  U.S. facilities and areas and adjust the operational procedures of U.S.  forces in Okinawa in order to reduce the burden on local communities.

Realignment efforts did not gain much traction until the end of 2002, when  the United States and Japan launched an ambitious series of realignment  initiatives called The Defense Policy Review Initiative (DPRI). Under  DPRI, both countries were seeking to reduce the U.S. footprint in  Okinawa, enhance interoperability and communication, and better  position U.S. forces to respond to a changing security environment. The  major realignment initiatives under DPRI are outlined in the United  States—Japan Roadmap for Realignment Implementation (2006  Roadmap) which was issued in May 2006 by the Security Consultative  Committee, reaffirmed and implemented in part in a 2009 bilateral  agreement, and recently adjusted in the April 2012 statement. There are  four initiatives under DPRI that are specific to the Marine Corps and its  current plans to realign its forces in the Pacific:  1. Futenma Replacement Facility,  2. Realignment of Marine Corps units,  3. Okinawa Consolidation, and  4. Carrier Air Wing Move from Atsugi to Iwakuni.

As envisioned by the 2006 Roadmap, the U.S. government would return  to Japan the Marine Corps Air Station Futenma in Okinawa once the  government of Japan constructed a fully operational replacement facility  (Futenma Replacement Facility), including a runway, in a northern, less  populated area of the island. This facility was originally projected to be  complete by 2014. According to Marine Corps officials, some facilities  have been constructed at the planned site of the realignment—Camp  Schwab; however, the construction of the replacement runway has  stalled. Those same officials stated that before construction of the  runway can proceed, the government of Japan has to issue an  environmental impact statement for the construction of the runway, and  the Okinawa government has to approve a landfill permit. According to  DOD officials, in December 2012, Japan’s Ministry of Defense submitted  the environmental impact statement to the Governor of Okinawa.  Subsequently, in March 2013, DOD officials informed us that the  government of Japan submitted the application for the landfill permit to  the Governor of Okinawa. Figure 2 shows the planned location of the  runway at Camp Schwab. The Marine Corps estimates that its Operation  and Maintenance and Procurement costs for the Futenma Replacement  Facility will be approximately $178 million over the next 5 years; however,  this estimate does not constitute the total cost to the United States and,  according to Marine Corps officials, has not been approved.

Because of the uncertainties surrounding the construction of the runway  at Camp Schwab and following direction from the Senate Armed Services  Committee, DOD has examined the feasibility of relocating air assets  from Marine Corps Air Station Futenma to Kadena Air Base, as an  alternative to constructing the Futenma Replacement Facility at Camp  Schwab. However, DOD concluded that it was not a viable solution. In  the April 2012 statement, the representatives from the United States and  Japan reconfirmed their view that the Futenma Replacement Facility  remains the only viable solution that has been identified to date. In  addition, the April 2012 statement noted that both governments  expressed their commitment to contribute to refurbishment projects at  Marine Corps Air Station Futenma to sustain safe mission capability until  the Futenma Replacement Facility is fully operational and to protect the  environment. According to Marine Corps officials, as of February 2013, a  list of refurbishment projects to be funded by the U.S. government and  the government of Japan has been identified, and planning for these  projects is expected to be completed by April 2013. Though time frames  may vary, Marine Corps officials expect work on these projects could start  sometime in 2014.

After several years of planning to move approximately 8,000 Marines off  Okinawa to Guam, DOD revised its plan in April 2012 to relocate some  units from Okinawa to Guam, Hawaii, and the Continental United States.  Additionally, the plan includes establishing a rotational Marine Corps  presence in Australia, a move that, according to DOD officials, stems  from a November 2011 agreement between the United States and  Australia. To date, the Marine Corps has established a small presence on  Guam to prepare for the Marine realignment, but it has not yet relocated  any units from Okinawa to Guam, nor has it been able to reduce its  presence on Okinawa as anticipated under the April 2012 statement.  According to Marine Corps officials, Marines cannot be relocated until  suitable replacement facilities are constructed and made operationally  capable on Guam and in other locations.

The Marine Corps’ current plan is to build facilities on Guam and live-fire  training ranges on Guam, Tinian, and Pagan—members of the Mariana  Islands—to support the realignment of approximately 5,000 personnel  (mostly rotational) and any dependents to Guam. Before any Marines  can relocate to Guam, DOD must examine the environmental effects of its  proposed actions, pursuant to the National Environmental Policy Act of  1969. To address this requirement in the past, DOD performed an  environmental review of certain proposed actions under the original 2006  realignment plan and released the Guam and Commonwealth of the  Northern Mariana Islands Military Relocation Final Environmental Impact  Statement in July 2010. In September 2010, the Department of the  Navy announced in the record of Decision for the Guam and  Commonwealth of the Northern Mariana Islands Military Relocation that it  will proceed with the Marine Corps realignment, but deferred the selection  of a specific site for a live-fire training range complex on Guam pending  further study. In February 2012, the Department of the Navy gave notice  that it intended to prepare a Supplemental Environmental Impact  Statement to evaluate locations for a live-fire training range complex on  Guam.Department of the Navy gave notice that it was planning to expand the   In October 2012, as a result of the current realignment plan, the  scope of the ongoing Supplemental Environmental Impact Statement  evaluating locations for the live-fire training range complex, to determine  the potential environmental consequences from construction and  operation of a main cantonment area, including family housing, and  associated infrastructure on Guam to support the recently revised  realignment plan. According to Marine Corps officials, the Supplemental  Environmental Impact Statement is expected to be completed by 2014,  and it is anticipated that a final decision on all matters being evaluated will  be released by 2015.established by the Navy in August 2006, leads this effort.

The Joint Guam Program Office, which was  DOD, using costing data derived from previous cost estimates for Guam,  estimates that the total cost to relocate Marines to Guam as part of the  realignment plan will be $8.6 billion in fiscal year 2012 dollars. According  to DOD officials, the government of Japan is expected to provide  approximately $3.1 billion for this realignment. As of June 2012, the United States had received $833.90 million from the Government of  Japan for this initiative; however, provisions in the National Defense  Authorization Acts for Fiscal Years 2012 and 2013 restricted the use of  funds provided by the government of Japan to implement the realignment  from Okinawa to Guam until DOD provided certain information to the  congressional defense committees. Although the National Defense  Authorization Act for Fiscal Year 2013 restricts the use of funds, it  contains exceptions allowing DOD to use funds to complete additional  environmental analysis for proposed actions on Guam or Hawaii, initiate  planning and design of construction projects at Andersen Air Force Base  and on Andersen South, and to carry out certain military construction  projects as specified in the act.

As part of the current realignment plan, DOD plans to move some Marine  Corps units to Hawaii and the continental United States. As of March  2013, the Marine Corps has not moved any units from Okinawa to either  Hawaii or the continental United States. Additionally, DOD plans to  establish a rotational presence of up to a 2,500 person Marine Air Ground  Task Force in an undetermined location in Australia. As an initial step  toward establishing a Marine Air-Ground Task Force in Australia, the  Marine Corps rotated approximately 200 Marines from Fox Company, 2nd  Battalion, 3rd Marine Division from their home station at Marine Corps  Base Hawaii, Kaneohe Bay, to Darwin, Australia for a 6-month rotation  from April to September 2012.

The April 2012 statement noted that the United States is committed to  returning lands on Okinawa to Japan as designated Marine Corps forces  are relocated and as facilities become available for units and other tenant  activities relocating to other locations on Okinawa. Figure 3 depicts all  U.S. installations on Okinawa and identifies which installations have been  designated to be partially or fully returned to Japan according to the April  2012 statement. According to the statement, the two governments will  jointly develop a consolidation plan, including sequencing of realignment  steps, for facilities and locations remaining in Okinawa by the end of  2012.costs for the consolidation, because consolidation plans remain under  development.

DOD officials said that they have not been able to estimate U.S.

section_title: DOD’s Initial Estimate for the Current Marine Corps Realignment Plan Is Not Reliable
paragraphs: Although DOD has developed a preliminary rough-order-of-magnitude  cost estimate for its current plan to relocate Marines from Okinawa and  realign them to Guam and other locations in the Pacific, it is not reliable,  because it is missing costs and is based on limited data. According to  DOD officials, DOD has not yet been able to put together a more reliable  cost estimate for its current plan, because it will not have the information  needed to do so until the completion of several key studies, including  environmental analyses for Guam and Hawaii. In addition, host nation  negotiations—specifically those with the government of Australia—have  not been completed. As part of its preliminary rough-order-of-magnitude  cost estimate, DOD currently estimates that it would cost approximately  $12.1 billion to implement the current realignment plan—not including the  Australia segment of the realignment. However, this estimate is not  reliable because it omits potentially critical cost elements and risk  parameters tied to the assumptions, and lacks detailed information on  requirements for several key cost components that are needed to capture  all costs related to the realignment. GAO’s cost estimation guide specifies  four characteristics of a reliable cost estimate—the extent to which an  estimate is comprehensive, well documented, accurate, and credible. We  found DOD’s estimate only partially meets best practices for being  comprehensive, and according to best practices, when a cost estimate is  not comprehensive, it cannot fully meet the other characteristics of a  reliable cost estimate. As a result, we did not evaluate the other three  characteristics. According to DOD officials, specific requirements and  their associated costs cannot be developed for each cost component until  the necessary analyses and host nation negotiations have been  completed. Still, we found that DOD did not include some up-front  practices that could have provided a more reliable estimate and could  have been done despite the fact that the environmental analyses and  host nation negotiations are not complete. For example, DOD officials  identified mobility support as a critical component to the implementation  of the realignment; however, no costs associated with mobility support  were included in the estimate. Additionally, DOD based its estimate on  several assumptions, but there was no evidence that DOD identified risk  impacts or parameters for any of these assumptions. Overall, the cost  components not fully addressed in the current estimate include the Guam  physical layout and requirements; the housing requirements on Guam;  the requirements to upgrade utilities and infrastructure on Guam; the Joint  Training Range Complex in the Northern Marianas; the Marine Corps  requirements for Australia; the Marine Corps requirements for Hawaii and  other U.S. locations; and mobility support. In addition, DOD continues to  seek funding for utilities and infrastructure projects on Guam that once  supported the original Marine Corps realignment plan. DOD officials  believe that some of these projects should not be affected by the current  realignment plan. However, assessments to determine the extent to  which these projects remain valid for the current realignment plan have  not been completed. As a result, it is unknown to what extent these  projects need adjusting, if at all, to support the new realignment plan.  Although DOD officials expect to develop a more reliable estimate as the  necessary environmental analyses are completed and host nation  negotiations have been finalized, they have not determined when this  estimate will be available for Congress.
subsections: section_title: DOD’s Estimates for Prior Realignment Plans Were More Detailed than the Estimate for the Current Plan
paragraphs: DOD has revised its plans and updated its cost estimates several times to  relocate Marines from Okinawa and realign them to other locations in the  Pacific. Table 1 lists the significant features, the number of Marines  expected to leave Okinawa, and the estimated costs associated with its  plans.

As noted in table 1, under the original realignment plan developed in  2006, the III Marine Expeditionary Force would have moved most of its  headquarters elements from Okinawa to Guam, but not the other  elements, such as ground forces and aviation units, that are needed to  create a full Marine Air-Ground Task Force capability. In 2010, DOD  developed a revised cost estimate, referred to as the Original  Realignment Plan Revised Cost Estimate (see table 1). This estimate is  based on planning, studies, and defined facilities requirements and  included additional cost elements, such as operation and maintenance,  procurement, overseas housing allowance, and family housing and  operations.  On the basis of this more detailed analysis, DOD’s estimate  for the original realignment plan increased from $10.3 billion in 2006 to  $19 billion in 2010. Marine Corps officials told us they believed that not  having a full Marine Air-Ground Task Force capability on Guam, a feature  of the original realignment plan, would have hindered the Marines’ ability  to properly train or deploy as a combined-arms force. Therefore, between  2010 and 2012, DOD examined different options for realigning Marines in  the Pacific. Although different options were considered, the costs  remained significant to the United States and no option was officially  adopted.

In April 2012, DOD briefed its current realignment plan to the  congressional defense committees. The current realignment plan calls for  the establishment of Marine Air-Ground Task Forces in Guam and  Hawaii, and a rotational presence in Australia. In 2012, DOD officials  developed a preliminary rough-order-of-magnitude cost estimate for the  current realignment plan, which relocates fewer troops to Guam and  realigns Marines to other locations in the Pacific. This preliminary rough- order-of-magnitude estimate for the current plan, which was briefed to  congressional defense committees in the spring of 2012, is $12.1 billion;  however, this estimate does not include any potential costs for the  Australia segment of the realignment. Table 2 provides more location- specific information on cost estimates and personnel breakdown for the  current realignment plan.

DOD officials informed us that the estimate for the current realignment  plan is lower than estimates for prior plans because of several factors.  One factor is that more Marines, approximately 1,300, will remain in  Okinawa than in previous plans, resulting in overall lower operation and  maintenance costs. For example, on Guam and Hawaii, the United States  will likely assume full responsibility for such things as labor and utilities  costs, whereas the government of Japan provides significant host nation  support for these two cost categories in Japan. Since more Marines will  remain on Okinawa, operation and maintenance costs will not be as  significant, causing the overall cost estimate to likely go down. Another  factor is a reduction in expected military construction costs on Guam.  According to DOD officials, since approximately 5,000 fewer Marines are  expected to relocate to Guam, and most of those who do will be deployed  on a rotational basis, there will be a reduced demand for additional  facilities and housing. Furthermore, DOD officials stated that the area  cost factor for Guam had declined in 2011, helping to reduce the overall  cost estimate.realignment plan will be lower than the estimates for previous plans.  However, DOD has not been able to apply the same rigor as was used in  developing previous estimates because, unlike for previous estimates,   DOD officials believe the cost estimate for the current  key studies, like environmental analyses, and host nation negotiations  that will affect requirements have not yet been completed.

section_title: DOD’s Estimate for the Current Realignment Plan Is Not Reliable
paragraphs: According to documentation attached to DOD’s fiscal year 2013 budget,  DOD cannot continue the practice of starting programs that prove to be  unaffordable. Therefore, DOD plans to achieve program affordability by  working to ensure that programs start with firm cost goals in place,  appropriate priorities set, and necessary trade-offs made to keep them  within affordable limits. Furthermore, this documentation states that  understanding and controlling future costs from a program’s inception is  critical to achieving the goal of affordability. According to GAO’s Cost  Estimating and Assessment Guide, whether or not a program is  affordable depends a great deal on the quality of its cost estimate. A  reliable cost estimate is critical to the success of any government  program, because it provides the basis for informed investment decision  making, realistic budget formulation and program resourcing, and  meaningful progress measurement. Office of Management and Budget  guidance containing best practices indicates that programs should  maintain current and well-documented estimates of program costs. In  addition, our research has identified a number of best practices that  provide a basis for effective program cost estimating and should result in  reliable cost estimates that an organization can use to make informed  decisions. These practices can be organized into the four characteristics  of a reliable cost estimate. The cost estimate should be comprehensive,  well-documented, accurate, and credible, as explained in table 3.

Our assessment of DOD’s preliminary estimate for the current  realignment plan is that it is not reliable, because it is missing costs and  based on limited data. To arrive at this conclusion, we assessed DOD’s  preliminary estimate against one of the four characteristics of a reliable  cost estimate, comprehensiveness. As shown in table 4, we found that  the preliminary estimate only minimally met best practices for being  comprehensive. According to best practices, when a cost estimate is not  comprehensive, it cannot fully meet the other characteristics of a reliable  cost estimate. For example, because the cost estimate is missing some  cost elements, the documentation is incomplete, and since the  requirements for the realignment are still being determined, the estimate  cannot be considered accurate. Finally, the cost estimate is not credible  because it does not include a full risk and uncertainty analysis, and the  potential exists that some of the costs have been underestimated. Table 4  provides a summary of our assessment of DOD’s preliminary cost  estimate.

As discussed in table 4, we found that DOD’s preliminary rough-order-of- magnitude estimate does not fully include requirements and associated  costs for all segments of the realignment plan, because this information  will not become available until several environmental analyses and  specific host nation negotiations are completed. While the reason for the  missing requirements and their associated costs is understandable, we  also found that DOD omitted specific costs and risk data that could have  resulted in a more reliable estimate and are not dependent on completion  of the environmental analyses and host nation negotiations. Most notably,  the estimate did not include any costs for mobility support, a component  that DOD officials said was necessary for the implementation of the  realignment. According to some DOD officials we spoke to, the potential  cost for additional mobility support could be considerable. In addition, we  found that the estimate was based on several assumptions, but there was  no evidence that DOD identified risk impacts or parameters for any of  these assumptions. For example, DOD assumed it would need $600  million to cover utilities and infrastructure costs for Guam. There were no  risk parameters put on this assumption indicating the estimate could be  higher or lower. Considering that historical data from previous  realignment plans estimated utilities and infrastructure costs for Guam at  over $1 billion, risk parameters could have identified the potential for  higher costs to DOD. Overall, we found that the preliminary estimate does  not adequately reflect the program because it cannot yet fully account for  the requirements and costs associated with the following seven cost  components:  1. Guam Physical Layout and Requirements.  2. Housing Requirements on Guam.  3. Requirements to Upgrade Utilities and Infrastructure on Guam.  4. Joint Training Range Complex in the Northern Marianas.  5. Marine Corps Requirements for Australia.  6. Marine Corps Requirements for Hawaii and Other U.S. Locations.  7. Mobility Support.

We discuss each of the seven cost areas in more detail below.

DOD does not yet know the full facilities requirements for Guam or  potential environmental mitigations; therefore, it does not have sufficient  information to determine the full costs of building the facilities and training  ranges needed to support the Guam segment of the realignment. The  cost estimate for the Guam segment of the current realignment plan— including the cost of establishing training ranges in the Commonwealth of  the Northern Mariana Islands and investing in local civilian  infrastructure—is approximately $8.6 billion, of which a portion will be  funded by the government of Japan. However, this estimate does not  fully capture the total costs of the Guam segment of the realignment,  because DOD has not determined the physical layout of the Marine Corps  presence on Guam, or fully identified specific infrastructure requirements  yet. To estimate the costs for the Guam portion of the realignment, DOD  officials assumed that the main Marine Corps installation, or cantonment,  would be constructed at Finegayan (an area in the northern part of Guam  just south of Andersen Air Force Base), and that the training range  requirements would not have changed from those in prior plans.  However, since the current plan calls for fewer Marines to relocate to  Guam, and the composition of the Marine units that will relocate has  changed, different locations might be selected for the main Marine Corps  cantonment and live-fire training ranges. Those locations under  consideration include military space at Andersen Air Force Base and  Naval Base Guam. As of January 2013, DOD is assessing alternatives  and the possible effects that the current plan might have on Guam’s  infrastructure and on the environment in order to develop the  Supplemental Environmental Impact Statement. The results of DOD’s  assessments could affect where DOD builds, what the facilities  requirements will be, and what environmental mitigations DOD might  take. DOD officials told us that they will wait until this environmental  impact statement is completed before proceeding with any further  planning and assessments that may be needed to identify specific  requirements.

DOD does not know the minimum level of government-provided housing  needed to accommodate the relocated Marines and to inform its housing  investment strategies to ensure that the housing needs of  servicemembers and their families are cost-effective on Guam. Of the  $8.6 billion estimate for the Guam segment of the current realignment  plan, DOD includes approximately $400 million to construct military  housing for Marines on Guam; however, DOD has not performed the  necessary housing analysis to validate this estimate yet, nor has it  determined how Navy housing policies and Joint Region Marianas  housing practices will affect Marine Corps housing requirements.  According to Joint Region Marianas officials, Joint Region Marianas is  responsible for maintaining and sustaining housing on Guam. In 2010,  DOD performed an analysis to determine the minimum level of  government-provided military housing needed to serve both  unaccompanied and accompanied servicemembers on Guam. However,  this analysis was based on the original realignment plan and is no longer  valid. The current realignment plan involves a smaller population and will  consist primarily of rotational personnel. Navy officials told us that a  realistic housing analysis indentifying construction requirements for the  Guam segment of the realignment would not be able to be determined  until closer to the time when Marine Corps families are expected to move  to Guam, which is not expected for another 10 years. In the interim,  Marine Corps officials have said that they will plan to build to 100 percent  of the Marine Corps’ housing requirement on Guam, an assumption that  will be used while completing necessary environmental reviews for the  Guam segment of the realignment. According to Joint Region Marianas  officials, their organization does not have the authority or responsibility to  determine how much housing the Marine Corps should build on Guam.

Navy housing policy is to encourage and rely on private-sector housing  whenever possible. Along these lines, the practice of Joint Region  Marianas is to rely on the private sector for housing for servicemembers  whenever possible. A majority of the current Navy and Air Force  servicemembers choose to live in private housing on Guam. Joint Region  Marianas officials were uncertain what the effects would be if the Marine  Corps proceeds with building 100 percent of the housing it needs for the  relocated Marines, and whether the Marine Corps would attempt to  prohibit Marines from living in private, off-base housing. Furthermore,  according to DOD officials, if the decision is to house Marines on any  existing installations on Guam, such as Andersen Air Force Base or  Naval Base Guam, additional support infrastructure, such as dining  facilities and gymnasiums, will likely be required. Joint Region Marianas  also has a surplus of unoccupied military housing that could potentially be  used to house Marines (see fig. 7 for photographs of select unoccupied  military housing units on Guam). Unoccupied housing will be discussed in  greater detail later in this report.

DOD has not updated its list of utilities and infrastructure requirements  that is tied to the current realignment plan; therefore DOD does not have  an accurate estimate of how much it will cost to upgrade Guam’s utilities  and infrastructure to support the planned Marine Corps presence on the  island. These public infrastructure requirements include utilities and  infrastructure improvements, as well as projects to augment public health  and social services, and mitigate the social, economic, cultural, and  environmental effects of the Marine Corps realignment to Guam. In June  2009, we reported that DOD had determined that existing utilities and  infrastructure on Guam were near or at their maximum capacities already,  and would require significant enhancements to support the increase in the  island’s population expected under the original realignment plan. In  addition, during the development of the 2010 Final Environmental Impact  Statement, DOD, the Guam Waterworks Authority, and the U.S.

Environmental Protection Agency developed a list of water and  wastewater projects to address deficiencies in Guam’s water and  wastewater infrastructure and respond to the increased population driven  by the original realignment plan. This list of projects, estimated to cost  approximately $1.3 billion, spanned the first 5 years of an overall 30-year  $5.3 billion capital improvement plan. The government of Japan was  expected to provide $600 million of the needed $1.3 billion, with the  remainder to be provided by DOD. Funding outside this 5-year timeframe  was expected to be covered by the government of Guam and non-DOD  federal government agencies. According to DOD Office of Economic  Adjustment officials, although other federal agencies, such as the  Department of the Interior’s Office of Insular Affairs, could help fund these  improvements on Guam, as of February 2013, there has been no  financial assistance for these projects from non-DOD agencies.

Although $1.3 billion in water and wastewater projects were connected to  the original realignment plan, the Marine Corps, as part of the $8.6 billion  estimate for the Guam segment of the current realignment plan, only  identified $600 million for all utilities and infrastructure. According to  Marine Corps officials, this $600 million was to only fund water and  wastewater projects that the government of Japan was previously  expected to finance, but is no longer obligated to pay for as a result of the  adjustments to the 2006 Roadmap announced in April 2012. Marine  Corps officials also said that the decision to include only $600 million was  a planning decision and not based on any updated analysis of public  infrastructure requirements for the current realignment plan. These same  officials said that any updated analysis would not be available until the  Supplemental Environmental Impact Statement for Guam was completed.  According to Office of Economic Adjustment officials, no matter how  many Marines relocate to Guam, significant improvements to the water  and wastewater infrastructure will be necessary; many of these  improvements are included in the $1.3 billion water and wastewater  infrastructure improvement estimate that was linked to the original  realignment plan.

DOD plans and designs for a joint training range complex on Tinian and  Pagan in the Commonwealth of the Northern Mariana Islands have yet to  be finalized, and the costs for this complex are not fully known. To  support the original realignment plan, DOD developed plans and designs  for live-fire training ranges on Tinian and Pagan, since not all training  could be accommodated by the proposed live-fire training ranges on  Guam. DOD also conducted several studies to identify training shortfalls  in the region and determined the Marine Corps training requirements for  units designated for realignment to Guam. According to Marine Corps  officials, these plans and requirement studies have been under review  since August 2012, and the studies have been updated to reflect the  changes made under the current realignment plan. Marine Corps officials  said that they intend to reexamine their plans and designs as they  prepare an updated environmental impact statement for this complex; this  environmental impact statement will be a separate effort from the Guam  Supplemental Environmental Impact Statement, and, according to DOD  officials, will be entitled the Commonwealth of the Northern Marianas  Joint Military Training Environmental Impact Statement. For the joint  training range complex environmental impact statement, Marine Corps  officials plan to examine alternatives and identify environmental  mitigations needed to proceed with the development of the complex.  Marine Corps officials anticipate issuing a Record of Decision by early  2016.

As part of the $8.6 billion estimate for the Guam segment of the current  realignment plan, DOD identifies military construction costs for the  complex to be approximately $800 million. However, this estimate does  not include updated costs associated with environmental mitigations or  operation and maintenance associated with the current realignment plan.  For example, Marine Corps officials said that developing an amphibious  landing training area on Tinian could require coral realignment, which  could cost approximately $10 million (see fig. 8 for photographs of select  proposed amphibious landing training areas). According to these same  officials, the Marine Corps will need to wait until environmental analyses  are completed before fully determining the costs for environmental  mitigations associated with the complex. Additionally, the Marine Corps  estimated some operation and maintenance costs to maintain and sustain  the complex under previous realignment plans, but has not updated these  estimates based on the current plan. According to Marine Corps officials,  there are currently no permanent DOD training facilities on Tinian, but the  Marine Corps intends to build permanent facilities to store equipment and  house civilians and servicemembers deployed to the island to train.  Furthermore, DOD has not developed a Concept of Operations for the  complex, which could be used to determine other associated costs, such  as transportation to and from the island.

DOD has developed some initial, rough-order-of-magnitude cost  estimates to establish a rotational presence of approximately 2,500  Marines in Australia; however, these cost estimates cannot be considered  comprehensive, because they are not based on finalized plans or  requirements. According to Marine Corps officials, facility requirements  for the Marine Corps have been provided to the government of Australia;  however, nothing has been finalized because there has yet to be a formal  agreement on host nation support options for the provided  requirements. In preparing to establish a rotational Marine Air-Ground  Task Force in Australia, the Marine Corps rotated approximately 200  Marines to Darwin, Australia, for 6 months beginning in April 2012. DOD  officials have also visited Australia to conduct site assessments and hold  discussions with their Australian counterparts. According to DOD officials,  DOD cannot finalize plans or fully determine facilities, housing, and  training requirements until negotiations with the government of Australia  have concluded. For example, Marine Corps officials said that the training  requirements for Marines in Australia will not differ from those of Marines  on Guam; therefore, officials did not know what additional infrastructure  and support facilities in Australia, if any, would be needed to address  these requirements. DOD officials acknowledged that the level of host  nation support has not been determined, including Australian preferences  for which Australian facilities will host the Marines, whether new facilities  need to be built and by whom, and how to coordinate training ranges for  exercises—all of which could significantly affect the costs of rotating a  presence to Australia. Other details related to the Marine Corps presence  will also need to be negotiated. For example, according to Marine Corps  officials, the Marine Corps is considering prepositioning equipment in  Australia, since it may be cost-prohibitive to transport equipment with  each new deployment, given the costs associated with agricultural  quarantine inspections and transportation; however, Marine Corps and  Defense Logistics Agency officials we spoke with said it was too early to  determine any details related to prepositioned stock because no  requirements had been established yet.

DOD has developed some initial, rough-order-of-magnitude cost  estimates to relocate Marines to Hawaii and the continental United  States; however, these cost estimates cannot be considered  comprehensive because they are not based on finalized plans or  requirements. According to Marine Corps officials, information needed to  help develop a comprehensive cost estimate will not be available until  necessary environmental analyses have been completed. The Marine  Corps and Navy have conducted initial assessments of possible locations  to expand the Marine Corps presence in Hawaii, but facility, housing, and  training requirements to support the realignment remain undefined.  According to Marine Corps officials, Naval Facilities Engineering  Command Pacific is currently in the process of conducting three  preliminary studies for the Marine Corps which will examine many  potential options (among all DOD lands on Oahu) for basing additional  Marines in Hawaii.locations for units relocating to the continental United States. According to  Marine Corps officials, before the Marine Corps can relocate units to  Hawaii and the continental United States, DOD will need to perform  environmental analyses and develop plans.

The Marine Corps has yet to identify possible  DOD did not include any estimates for mobility support in its preliminary  estimate and could not provide sufficient information on how it intends to  provide mobility support—which could be costly—to Marine Corps units  once the current realignment plan has been implemented. According to  Marine Corps officials, the current realignment plan was developed under  the assumption that sufficient mobility capabilities would be available to  support Marine Corps units stationed in the Pacific; however, as of  August 2012, although DOD officials said studies looking at lift in the  Pacific were underway, DOD had not completed any studies to determine  the implications for mobility of distributing Marines to multiple locations in  the Pacific. Marine Corps officials responsible for managing and  implementing the current realignment plan could not provide us with  information on how the Marines would travel to and from routine  operations, such as training events, and contingency operations once the  current realignment plan was implemented. As of August 2012, DOD  officials said that the Department of the Navy was conducting a study of  possible mobility solutions to support the current realignment. However,  at the time of our review, the study remained in draft format and under  review at DOD. Also, United States Transportation Command and its  subordinate commands have not assessed the implications of the current  realignment plan’s mobility requirements for its current operations and  assets, because no request has been made to perform such a study.  According to United States Transportation Command Officials, they did  not assess mobility requirements associated with distributing Marines to  multiple locations in the Pacific in the command’s last Mobility Capability  Requirements Study, and to their knowledge, mobility requirements  supporting the current realignment plan were not assessed for the  command’s current study, due to be published in summer 2013.

The Marine Corps uses a variety of assets to transport personnel and  equipment in the Pacific region. For example, the Marine Corps has in the  past chartered the Westpac Express, a commercial shipping vessel, to  transport personnel and equipment to various locations for training  exercises or contingency operations. Marine Corps officials stated that  they assumed that they would be able to use recently acquired Joint High  Speed Vessels to transport troops and equipment. The Marine Corps can  also use air and sea assets provided by U.S. Transportation Command.  Another option is the Amphibious Ready Group, which consists of a group  of Navy warships, including amphibious assault and dock landing ships,  and a landing force used to perform amphibious operations. The Navy  has one forward-deployed Amphibious Ready Group stationed in Sasebo,  Japan, that supports the 31st Marine Expeditionary Unit. Pacific  Command officials said that a possible solution would be to deploy  another Amphibious Ready Group to the command’s area of  responsibility, but this could be costly if new ships and supporting  infrastructure are required. According to the Congressional Budget Office,  the average cost of constructing an Amphibious Assault Ship alone is  $4.3 billion.

DOD civilian, military, and State Department officials have all stressed the  importance of ensuring that sufficient mobility capabilities are available to  support the current realignment plan. State Department officials said that  U.S. allies in the region may become concerned with DOD’s ability to  address threats, given the distribution of Marine Corps units across the  Pacific region, as proposed under the current realignment plan. Military  officials also warn that a lack of mobility capabilities could affect the ability  of the U.S. military to both adequately train and execute missions.

section_title: DOD Sought Funding for Guam Utilities and Infrastructure Projects in Fiscal Years 2012 and 2013, but the Request Was Not Revalidated on the basis of the Current Realignment Plan
paragraphs: DOD has sought funding to upgrade utilities and infrastructure on Guam  prior to updating its assessment of requirements needed to support the  personnel and facilities changes in the current realignment plan.  According to Office of Economic Adjustment officials, $106.4 million in  funding was sought for the first stages of the Guam water and wastewater  improvements in fiscal year 2013. In addition to the water and wastewater  improvements, DOD sought an additional $33 million of funding for the  completion of mental health facilities, and the construction of a public  health laboratory on Guam in fiscal year 2013. The $33 million is the  second half of a $66 million island-wide socioeconomic improvement plan  coordinated through the Economic Adjustment Committee based on the  sudden population growth associated with the original realignment plan.   The other $33 million, for projects that included the construction of a  cultural repository, the purchase of school buses (for emergency  evacuations and military dependents), and improvements to the Guam  Mental Health and Substance Abuse Facility, was sought in fiscal year  2012. The National Defense Authorization Act for Fiscal Year 2013  authorized appropriations for the Office of Economic Adjustment, but did  not include specific authorizations for the projects. officials, funding for these projects has been put on hold until restrictions   According to DOD  imposed by the National Defense Authorization Act for Fiscal Year 2013  have been addressed.

According to Office of Economic Adjustment officials, some of the  socioeconomic and utilities projects, such as the cultural repository, and  water and wastewater improvements, should not be affected by the  changes in personnel and facilities associated with the current  realignment plan; however, some projects, such as the improvements to a  mental health and substance abuse facility, may not be necessary due to  fewer Marines and dependents relocating to Guam. Office of Economic  Adjustment officials said that they intend to perform assessments, in  conjunction with the Joint Guam Program Office, to reexamine and  validate all utilities and infrastructure projects during DOD’s development  of the Supplemental Environmental Impact Statement for Guam.  However, until these assessments are completed, DOD is seeking  funding for utilities and infrastructure projects that have either not been  fully estimated or may no longer be needed.

section_title: A Comprehensive Cost Estimate for the Realignment of Marines in the Pacific May Take Years
paragraphs: DOD officials told us that they intend to develop a more reliable cost  estimate for the current realignment plan as environmental analyses and  host nation negotiations are completed. According to DOD officials, the  completed analyses and finalized host nation negotiations will provide the  necessary information needed to complete a comprehensive cost  estimate for the current realignment plan, but DOD officials have not  determined when this estimate will be available. They informed us that a  more detailed estimate for the Guam realignment would require the  completion of an ongoing environmental impact statement on Guam,  which is expected to be completed in 2014, and a separate environmental  impact statement for the Joint Training Range Complex on Tinian and  Pagan, which is expected to be completed in 2015. According to DOD  officials, the Hawaii segment of the realignment would also require an  environmental analysis before a more detailed cost estimate could be  performed, but as of March 2013, they did not anticipate that this analysis  will be completed until a date beyond 2018. Furthermore, DOD officials  do not anticipate that a more detailed estimate for Australia will be  available until host nation negotiations are complete, but no date has  been determined for the conclusion of these negotiations. According to  the Office of Management and Budget guidance containing best practices  for cost estimating in the context of capital programming, early emphasis  on cost estimating during the planning phase is critical to successful life  cycle management of a program or project. This guidance recognizes  that insufficient data and undefined risks are some of the challenges in  estimating costs. It also notes that the cost estimating process is  continuously updated, on the basis of the latest information available, to  keep the estimate current, accurate, and valid. According to DOD  officials, updated cost estimates will be developed when additional data  from ongoing analyses are available and negotiations have been  completed. However, until estimates are developed that address the  seven cost components described in this report, DOD will not be able to  provide Congress and other stakeholders with a reliable cost estimate to  make informed funding decisions regarding the realignment of Marines.

section_title: DOD Has Not Yet Completed an Integrated Master Plan to Synchronize Realignment Initiatives in the Pacific or a Strategy to Support Japanese Construction
paragraphs: In April 2012, DOD announced that it would be revising its previous  Marine Corps realignment plan; however, DOD has not yet completed two  key planning mechanisms: an integrated master plan that synchronizes  the various realignment initiatives with all geographic segments of the  realignment and a construction support strategy. Although DOD has  taken initial steps to begin the master planning effort for the realignment,  DOD has not yet been able to fully develop an integrated master plan  synchronizing the realignment with other DPRI initiatives and laying out  the necessary facilities, progression of construction, unit movements, and  costs to efficiently complete the realignment. Furthermore, DOD has not  developed a strategy to support a potential surge of simultaneous  Japanese construction projects associated with the other DPRI initiatives  that may occur concurrently with the realignment of Marines.
subsections: section_title: Effects of Other Initiatives in the Pacific on the Sequencing of the Current Realignment Plan Remain Uncertain
paragraphs: DOD is moving forward with the current realignment plan; however,  Marine Corps officials are still determining how the projects associated  with the Futenma Replacement Facility and Okinawa Consolidation are  either related to or dependent on each other, and what effects these  projects might have on the realignment of Marines. According to Marine  Corps officials, uncertainties surrounding these initiatives and the effects  on the realignment of Marines will exist until the government of Japan can  provide a timeline for construction of related facilities. The Futenma  Replacement Facility is an initiative in which Japan is constructing  facilities and a runway to replace Marine Corps Air Station Futenma on  Okinawa. Okinawa Consolidation is an initiative that involves returning  land to Japan that is currently occupied by U.S. military installations and  consolidating the remaining U.S. forces in less populated areas of  Okinawa once Japan has constructed necessary replacement facilities.  Under the 2006 Roadmap and the 2009 agreement, these initiatives,  along with the realignment of Marines to Guam, were directly linked  because progress on both Okinawa Consolidation and the realignment of  Marines was contingent on Japan making a certain level of progress  toward completion of the Futenma Replacement Facility and financial  contributions to fund development on Guam. However, as part of the  April 2012 statement, the Security Consultative Committee decided to  delink these initiatives, effectively no longer requiring that progress on  constructing the Futenma Replacement Facility be made before the other  initiatives could commence. This change, in theory, allows all three  initiatives to move forward independently of each other; however, in  practical terms, the three initiatives still have elements that are linked, and  each could ultimately affect the progress of the others.

According to Marine Corps officials, since the three initiatives remain  likely to be implemented concurrently, the proper sequencing of  movements will influence whether the Marine Corps can maintain full  operational capability and how smoothly the realignment can be  accomplished. However, at the time of our review, it was too early to tell  how each of the three initiatives will affect the progress or sequencing of  the others. For example, Marine Corps officials said that many elements  of Okinawa Consolidation will still be contingent on substantial progress— and in some cases completion—of the Futenma Replacement Facility at  Camp Schwab. In the April 2012 statement, the Security Consultative  Committee agreed that some segments of Okinawa Consolidation could  start immediately, but the sequencing and timing of the more significant  segments, such as those related to Marine Corps Air Station Futenma  and Camp Schwab, were going to have to be determined through bilateral  planning at a later date. At the time of our review, the two countries had  not finalized a bilateral plan for Okinawa Consolidation; therefore, Marine  Corps officials on Okinawa could only make assumptions about the  details of the initiative. Furthermore, Marine Corps officials on Okinawa  believed that unless facilities related to the realignment of Marines are  constructed on Guam and Hawaii, significant elements of the Okinawa  Consolidation could not progress. For example, certain Marine Corps  units that currently reside at Camp Schwab on Okinawa would have to be  able to relocate to either Guam or Hawaii before other units could move  to Camp Schwab.

section_title: DOD Has Not Yet Been Able to Complete an Integrated Master Plan for the Current Realignment Plan
paragraphs: Since the original realignment plan in 2006, congressional committees  have been calling for DOD to submit a master plan or other information  regarding the realignment, including costs and schedules for projects.  However, DOD has not developed and finalized a master plan in support  of the realignment. Congressional committees have expressed concern  about the sweeping transformation in the Pacific, including concern  regarding the practicality and economic viability of the realignment. In  some instances, committees have sought a master plan or other  information regarding the realignment of Marines before they will support  the authorization or appropriation of certain funds to be used towards the  implementation of the initiative. Most recently, the National Defense  Authorization Acts for Fiscal Years 2012 and 2013 imposed restrictions  on the use of funds to implement the realignment until DOD submits  certain information to the congressional defense committees, including  master plans. Previous GAO reports on the original realignment plan  have stressed the importance of a master plan to provide Congress with a  complete picture of facility requirements and associated costs so that it  can make informed funding decisions. DOD was not able to provide a  specific time frame including when it plans to complete an overarching  master plan in support of the current realignment plan.

Department of Defense, Integrated Master Plan and Integrated Master Schedule  Preparation and Use Guide, ver. 0.9 (Oct. 21, 2005). take planners through “what if” scenarios to determine whether certain  aspects of the realignment are actually executable.

At the time of our review, Headquarters Marine Corps, which is  conducting the master planning process for the realignment of Marines,  had started to develop what officials called the first step of an integrated  master plan. This first step, called the synchronization matrix, is described  by Headquarters Marine Corps officials as an overarching scheduling tool  that synchronizes the various realignment initiatives and graphically  depicts how these realignments are interconnected and affected by both  unit movements and facilities construction. Specifically, the  synchronization matrix attempts to synchronize other DPRI initiatives— the Carrier Air Wing Move from Atsugi to Iwakuni, Okinawa Consolidation,  and the Futenma Replacement Facility—with time frames and unit  movements associated with the realignment of Marines. During the  course of our review we spoke with Marine Corps officials from the  Pentagon, Honolulu, and Okinawa, and heard conflicting views on the  logical order of unit movements, the potential effects of the other DPRI  initiatives on the realignment, and the time frames associated with each  move. For example, Headquarters Marine Corps officials said they  believed that fighting forces should be the first to leave Okinawa and  relocate to Guam; however, Marine Corps officials we spoke to in  Okinawa did not agree, stating that headquarters units should move first,  followed by the fighting forces. According to Headquarters Marine Corps  officials, the synchronization matrix will serve as a tool to address any  conflicting internal views, determine how each initiative relates, and  establish the appropriate sequencing of events needed to complete all  realignment initiatives.

Although the synchronization matrix is an important first step of the  integrated master plan, it is still based on several assumptions regarding  environmental analyses, facilities planning, funding availability, and,  where applicable, host nation support, meaning that it’s always subject to  change. As previously discussed, since environmental analyses and host  nation negotiations still need to be completed, Marine Corps officials have  not developed specific projects, facility and resource requirements, and  costs for the realignment of Marines. According to Marine Corps officials,  once the necessary analyses and negotiations are completed for each  geographic segment—Guam, Hawaii, Australia, and the continental  United States—of the realignment, DOD can begin to finalize master  plans specific for each location. Each master plan, coupled with the  synchronization matrix, will eventually formulate an integrated master  plan for the realignment of Marines.

According to Marine Corps officials, they recognize the importance of the  master planning process for the realignment of Marines; however, they  know master plans for some geographic segments of the realignment  may take several years to produce. DOD officials stated that they can  only estimate when an integrated master plan can be completed, but it  will likely be beyond the 2018 time frame. Until then, Marine Corps  officials stated that they will continue to update the synchronization matrix  as geostrategic events change, and analyses and negotiations conclude.  Still, without an integrated master plan that reflects not only the  synchronization of DPRI initiatives with the realignment of Marines, but  the projects, facility and resource requirements, and costs for all  geographic segments of the realignment, congressional committees will  not have a complete picture of the requirements and costs in order to  make informed funding decisions.

section_title: It Is Unclear Whether DOD Can Support a Surge in DPRI-Related Construction
paragraphs: With several hundred projects associated with the remaining DPRI  initiatives in mainland Japan and on Okinawa, and the likelihood that  these initiatives will be implemented concurrently, it remains unclear  whether DOD would be able to support a surge of this magnitude in  construction in Japan. Although the April 2012 Security Consultative  Committee statement did not establish definitive time frames or identify  start and completion dates for the Futenma Replacement Facility,  Okinawa Consolidation, or the realignment of Marines, DOD officials have  stated that it is likely all three of these initiatives will proceed concurrently  with the ongoing DPRI initiative to relocate a carrier air wing from Naval  Base Atsugi to Marine Corps Air Station Iwakuni in mainland Japan. It is  anticipated that the government of Japan will fund and construct the  hundreds of projects associated with the remaining DPRI initiatives in  mainland Japan and Okinawa; however, DOD will play a critical role in the  design and construction oversight of these projects, assuring that each  project is built to U.S. requirements and standards. Although DPRI- related construction at Iwakuni commenced in the last year, and only 10  projects in Okinawa have been completed to date, Marine Corps officials  told us that DOD has encountered several challenges in supporting the  design and construction of these projects; these challenges have led to  delays in construction and, in some instances, generated additional costs  to the United States. Several DOD officials we spoke with were  concerned that if the other DPRI initiatives were to begin, DOD might not  be in a position to support the surge in construction.

DPRI construction projects in mainland Japan and Okinawa fall under the  purview of the United States Army Corps of Engineers. As the DOD  construction agent, the Army Corps of Engineers is responsible for  working with each service to provide design and construction criteria to  the government of Japan, and then design and construction surveillance  and inspection to make sure that every DPRI project is being completed  in accordance with the appropriate requirements and standards.  However, according to Marine Corps officials, the Army Corps of  Engineers has had a difficult time supporting the DPRI-initiatives at both  at Iwakuni and at Okinawa. For example, Marine Corps officials at  Iwakuni told us that the Army Corps of Engineers was both underfunded  and understaffed to support initial Japanese design and construction  efforts, and that, as a result, officials at Iwakuni circumvented the DPRI  project development process in order to move project design and  development along more quickly. According to these same officials, the  government of Japan was prepared to provide as much funding as was  necessary to complete construction of the facilities at Iwakuni as early as  possible. Marine Corps officials also told us that in its fiscal year 2011  budget, the government of Japan allocated $700 million for the design  and construction of facilities at Iwakuni (see fig. 9 for a photograph of the  ongoing Japanese construction at Marine Corps Station Iwakuni).  However, DOD and the Army Corps of Engineers were unprepared to  support an effort of this magnitude. According to officials at Iwakuni, the  Army Corps of Engineers did not have the resources to support an  accelerated buildup of this magnitude by the government of Japan and  questioned whether the Army Corps of Engineers could fully support the  entire DPRI initiative at Iwakuni, which will eventually cost Japan nearly  $3 billion to complete through 2017.

The Marine Corps officials we spoke with in Okinawa agreed with the  officials at Iwakuni, suggesting that the Army Corps of Engineers did not  have the appropriate resources to oversee the design and construction of  the DPRI-related projects in Okinawa. Although less than 20 DPRI-related  projects have been designed and constructed to date, according to  Marine Corps officials several of these projects had errors that led to  unplanned budget expenditures by DOD. Marine Corps officials attributed  most of the errors to a lack of communication of proper requirements to  the government of Japan, and insufficient oversight during the  construction process. For example, the government of Japan designed  and constructed a bachelor enlisted quarters at Camp Schwab based on  requirements provided by the Army Corps of Engineers and the Marine  Corps. After construction was completed, the Marine Corps refused to  accept the building, because it discovered that the building’s heating,  ventilation, and air conditioning systems did not meet Marine Corps  standards. Army Corps of Engineers officials said that they had not  identified the discrepancy between the Marine Corps’ requirement and  the government of Japan’s designs prior to construction, resulting in the  error. After about a year, the Marine Corps corrected the problem by  developing an ad hoc solution to the heating, ventilation, and air  conditioning systems issue at its own expense in order to bring the  building up to its standards. In another example, on the basis of  requirements provided by the Marine Corps and Army Corps of  Engineers, the government of Japan designed and constructed a new  police station with a fenced-in area to house military working dogs at  Camp Foster. After construction had been completed, it was discovered  that the fenced-in area had not met DOD standards for housing military  working dogs. As a result, the Marine Corps funded a corrective action.  See figure 10 for a list of additional DPRI-related construction errors in  Okinawa, as described by the Army Corps of Engineers.

Army Corps of Engineers officials said they are aware of the setbacks  associated with the DPRI-projects in both Iwakuni and Okinawa; however,  Army Corps of Engineers officials told us that external factors associated  with its DOD counterparts (U.S. Forces–Japan and the military services)  may have helped to contribute to these setbacks. For example, Army  Corps of Engineers officials told us that both a lack of proper master  planning and circumventing the DPRI project development process at  Iwakuni led to an expedited process that caused heightened risk. The  expedited process, according to Army Corps of Engineers officials, made  it difficult to catch and correct errors in the design phase of DPRI projects.  Army Corps of Engineers officials expressed concern that if DPRI projects  in Okinawa proceed in a similar, expedited manner as Iwakuni, similar  problems will occur, including heightened risk and an inability to  appropriately plan for resource requirements.

In response to the setbacks related to DPRI projects in both Iwakuni and  Okinawa, the Army Corps of Engineers has requested funding to increase  staff at Iwakuni by 75 percent in fiscal year 2013 and have designed tools  intended to prevent such setbacks in the future. For example, Army Corps  of Engineers officials developed case studies of the errors and  disseminated the information throughout their organization to better  prepare their staff. In March 2011, Army Corps of Engineers personnel  and senior leadership held an internal meeting to review construction  project errors and discuss ways of improving their services. In addition, to  ensure that they have sufficient resources and staffing to support the  Marine Corps and the other services, Army Corps of Engineers officials  have told us that they have conducted analyses every 6 months since  July 2011 to forecast their future workload. These forecasts, according to  Army Corps of Engineers officials, will continue in the future and include  planning for any ramp-up needed in the immediate future.

section_title: DOD Does Not Have a Strategy for Supporting a Surge in Japanese Construction
paragraphs: Although the Army Corps of Engineers has recognized and attempted to  address the problems associated with the DPRI-related projects at  Iwakuni and Okinawa, at the time of our review it had not yet developed a  strategy, in conjunction with its DOD counterparts, to support a surge in  Japanese construction that would require Army Corps of Engineers to  support multiple, concurrent DPRI initiatives. Army Corps of Engineers  officials acknowledged that there is potential for a surge in Japanese  construction, so it is important that both the Army Corps of Engineers and  the services be prepared for such an event. Furthermore, Army Corps of  Engineers officials stated that the way the government of Japan funds  and plans for construction makes DOD planning difficult. Specifically,  according to DOD officials, the government of Japan funds projects on a  year-by-year basis, giving DOD limited time to react in any given year.  According to Army Corps of Engineers officials, the lack of a bilateral  integrated master schedule for all DPRI initiatives between the United  States and Japan makes it very difficult to forecast its resource  requirements more than 1 year at a time. However, Army Corps of  Engineers officials agreed that they must still work to develop a strategy  to deal with the possibility that additional resources will be needed to  support any surges in Japanese construction up to 5 years in the future.

In previous work, we identified key elements that should be included in a  support strategy:

Goals, subordinate objectives, activities, and performance measures  set clear desired results and priorities, specific milestones, and  outcome-related performance measures while giving implementing  parties flexibility to pursue and achieve those results within a  reasonable time frame.

Organizational roles, responsibilities, and mechanisms for  coordinating their efforts identify the relevant components. The  strategy clarifies the components’ relationships in terms of leading,  supporting, and partnering.

Resources, investments, and risk management identify, among other  things, the sources and types of resources and investments  associated with the strategy and where those resources and  investments should be targeted.

Without a strategy to address future construction surges, the Army Corps  of Engineers and the services will not have a clear picture of how the  design and construction process should be handled moving forward, or  the resources needed to support the effort. Such a strategy would allow  both the Army Corps of Engineers and service officials—mainly the  Marine Corps—to establish a process that assigns specific  responsibilities, with time frames, to participating parties and assist the  Army Corps of Engineers in identifying funding needed to support  construction projects being conducted by both the United States and  Japan. Without a strategy, DOD may not be in a position to successfully  support upcoming DPRI-related projects and may face further planning  and construction errors that have in the past led to unplanned funding  needs and delayed completion schedules. Delayed completion schedules  may ultimately affect the implementation of the realignment of Marines or  other DPRI initiatives.

section_title: DOD Has Taken Initial Steps but Has Not Fully Identified Sustainment Needs and Costs on Okinawa and Guam
paragraphs: DOD has taken some steps to plan for sustaining its forces on both  Okinawa and Guam until the Marine Corps realignment is implemented  and consolidation initiatives on Okinawa are complete, but it has not yet  fully identified what will need to be done to sustain the facilities at these  locations and what it will cost for the immediate future. Facility  maintenance and replacement for installations on Okinawa that were  identified to be returned to the government of Japan have been limited for  many years. As a result, many facilities have reached the end of their  useful life and are in a state of disrepair. Specifically, DOD has identified  the sustainment needs on Okinawa for Marine Corps Air Station  Futenma; however, it has not identified sustainment needs for other  facilities on the island that are expected to be eventually returned to  Japan or fully planned for the sustainment of its family housing units on  Okinawa. In Guam, DOD has begun to develop initial sustainment plans  for its family housing units; however, these plans have not been updated  to reflect the Marine Corps’ current realignment plan.
subsections: section_title: Many Okinawa Facilities Have Reached the End of Their Projected Service Life, and Maintenance and Replacement Has Been Limited
paragraphs: According to Marine Corps officials on Okinawa, many of the facilities  supporting U.S. forces there are old, and are in need of resources to  sustain them. We observed multiple facilities in various states of disrepair  during our site visit to the island. For example, we observed facilities at  Marine Corps Air Station Futenma that had been shuttered because  service officials deemed them too dangerous to occupy; in some cases,  there was so much mold growth that an extensive removal process would  be necessary before the facilities could be occupied again. In addition to  mold removal, some of these facilities would require other improvements  or complete renovation before they could be used again. Marine Corps  officials said that in some of the Marine Corps installations south of  Kadena Air Base several facilities either are nearing or have already  exceeded their 50-year service life and will need to be either renovated or  replaced. The most significant examples of aging and deterioration that  we observed were at Marine Corps Air Station Futenma, the installation  that has been at the center of controversy on Okinawa for nearly two  decades. At Futenma, at several facilities currently in use, we observed  concrete ceilings, staircases, and walls that showed evidence of  deterioration, ranging from superficial cracks on the exterior of the  structure to severe fracturing that rendered the facility unsafe for  occupancy. Figure 11 shows some examples of deteriorated conditions at  two locations on Okinawa.

On Okinawa, DOD conducts routine maintenance and repair to keep its  facilities in good working order over a 50-year service life and has  historically relied on the government of Japan to fund the construction of  new U.S. facilities to replace deteriorating, obsolete structures. The  government of Japan will demolish these structures and construct new  ones through the Japan Facilities Improvement Program. The program  allows DOD to identify necessary projects from across the services and  installations in Japan, rank them by priority, and submit them to the  government of Japan for funding consideration.

In recent years, sustainment funding and facility replacement by the  government of Japan has been limited because delays in the Marine  Corps realignment, construction of the Futenma Replacement Facility,  and Okinawa Consolidation have left unclear what facilities will need to be  available and sustained—and for how long. Since 2006, in the face of the  uncertainties surrounding these initiatives, both DOD and the government  of Japan have questioned how they will proceed with maintaining some  existing facilities on Okinawa. According to Marine Corps officials,  because of the uncertainties surrounding the timing of the various  realignment initiatives, the government of Japan has been hesitant to  invest in constructing new facilities on Okinawa. Figure 12 shows a  steady decline in funding since 2002 under the Japan Facilities  Improvement Program. In 2002, Japan provided approximately ¥75  billion, or approximately $834 million. Of that ¥75 billion, approximately ¥6 billion, or $67 million, was for Marine Corps installations in Okinawa. The figure shows a significant decline for funding in 2006, the year the  2006 Roadmap was developed outlining the realignment initiatives.

The U.S. dollar figures are based on the January 2013 foreign exchange rate of 89.86 to  indicate an approximate value.

section_title: Family Housing
paragraphs: The Air Force, which is the executive agent for military family housing on  Okinawa, had 7,823 family housing units in its active inventory as of  February 2013. In February 2013, approximately 75 percent of its housing  units were occupied. According to DOD officials, similar to other DOD  facilities on Okinawa, many of the family housing units are old and in  need of renovation or replacement. At Kadena Air Force Base, we  observed several vacant housing units that had not been renovated and  showed significant mold damage. We also observed several recently  renovated units. According to Air Force officials, approximately 58 percent  of the military family housing units on Okinawa have been assessed as  inadequate. However, inadequate units are not necessarily  uninhabitable. Air Force officials told us that one reason these units have  been assessed as inadequate is that they were built to Japanese  standards, which can differ significantly from Air Force standards. For  example, Japanese accommodations tend to be smaller than housing  units constructed by the services, so that kitchen, bathroom, and  bedroom space may be more limited than it is in family housing units at  other DOD locations, although the units are still viewed as safe to occupy.

The Air Force developed a family housing master plan in November 2011  to provide a corporate, requirements-based housing investment strategy  that integrates traditional construction funding and private sector  financing. This master plan covered the period of fiscal years 2012  through 2017 and estimated that the total funding required to maintain  adequate military family housing and bring all housing-related  infrastructure on Okinawa up to modern DOD standards would be $690.7  million; this figure includes $131.7 for military construction and $559.1 for  operation and maintenance. On the basis of its analyses and master plan,  the Air Force has been working to modernize or replace 6,988—89  percent—of its family housing units on Okinawa through various  initiatives. Under its Post-Acquisition Improvement Program, the Air Force  intends to renovate 3,747 housing units; these renovations are  considered to be more extensive than minor repair and maintenance work  and are intended to ensure that the renovated unit remains habitable for  their full service lives. The government of Japan planned to build 1,770  new units under the 1996 Special Action Committee on Okinawa report  and another 1,471 under the Japan Facilities Improvement Program, but  as of February 2013 it had built only 38 percent of the first group and 13  percent of the second. (See table 5 for list of family housing projects and  status as of February 2013.)

The Air Force’s current master plan and supporting analyses were based  on the premise that approximately 8,600 Marines and 9,000 dependents  would relocate to Guam by 2014—as anticipated under the original  realignment plan. However, under the current realignment plan, DOD is  planning to move only 4,700 Marines and their dependents to Guam. Air  Force officials informed us that because many of the replacement  projects funded by the government of Japan are on hold, they have  developed a “bridging strategy” to fund minor renovations for a select  number of units, in order to meet DOD’s housing needs on Okinawa until  additional units are constructed or renovated. As a result of the  deterioration of its facilities and replacement projects being on hold,  Marine Corps officials have stated that a sustainment funding strategy is  going to be critical to maintain some of its infrastructure that has  deteriorated past its useful life for the immediate future.

section_title: DOD Has Taken Some Steps but It Has Not Fully Identified Sustainment Needs for Facilities on Okinawa
paragraphs: Marine Corps officials have stated that the uncertainties regarding the  timing of the realignment initiatives have made it difficult for them to  determine what sustainment projects will be needed for facilities on  Okinawa, because they do not know when the realignment initiatives will  be completed and therefore do not know how long the existing facilities  will continue to be used. Marine Corps officials in Okinawa informed us  that construction and sustainment projects described in the base master  plans for each of the Marine Corps installations on Okinawa have not  been updated to take into account delays in the realignment and  consolidation plans, and that these base master plans remain in draft  form. DOD has not developed any updated sustainment plans for these  installations as part of their base master plans—with the recent exception  of Marine Corps Air Station Futenma.

Many of the facilities on Futenma are 30 to 50 years old and have  degraded over time due to limited investment in sustainment and the  harsh tropical and corrosive saltwater environment of Okinawa. In  response to the April 2012 Security Consultative Committee statement,  and the delay in the Japanese construction of a replacement facility at  Camp Schwab, the United States began to identify sustainment needs for  Futenma. In April 2012, in a preliminary estimate, the Marine Corps  identified approximately $165 million in funding needed to sustain  Futenma for the next 10 years. In October 2012, the Marine Corps  developed a draft sustainment plan after performing an assessment of the  facilities on Futenma to identify, validate, and prioritize its sustainment  needs. This plan included a priority list of repair and maintenance  projects, and new construction projects needed to ensure that Futenma  could continue to meet operational and training demands until the  Futenma Replacement Facility is constructed and fully operational. The  plan prioritizes facility repair and renovation projects to address critical  mission and quality-of-life requirements. U.S. Forces–Japan officials said  that DOD and the government of Japan are negotiating a possible cost- sharing arrangement, and that as of February 2013, both sides had  agreed to a list of projects that the government of Japan had submitted to  its legislature for funding consideration. Marine Corps officials said that,  without sustainment investment, the installation’s ability to support  operations would be put at risk.

See Department of Defense Instruction 4165.70, Real Property Management, para. 6.1  (Apr. 6, 2005). capture facility requirements and propose solutions to meet those  requirements from the options available. The Unified Facilities Criteria  also indicates that a facility’s master plan will be revised and updated to  maintain its relevance as a useful planning and management tool.

Furthermore, guidance on DOD housing management indicates that DOD  housing—both family and unaccompanied—is to be operated and  maintained to a standard that protects the facilities from deterioration and  provides safe and comfortable living places for servicemembers and their   DOD policy is to rely on the private sector as the primary  dependents. source for family housing for personnel stationed at locations within the  United States. DOD guidance indicates that in overseas locations where  servicemembers are given an overseas housing allowance to reimburse  them for the cost of housing, the policy of relying on off-base housing first  is not mandatory, but should be encouraged where appropriate.guidance also indicates that for installations on U.S. soil, to determine the  need for military housing at the installation, the military services must  perform a housing requirements and market analysis to determine  whether the adjacent community can accommodate the housing needs of  the military and must identify the minimum housing requirement—the  minimum level of housing needed on base to allow the installation to  effectively accomplish base missions. If the base is located overseas, the  military service may determine the need and applicability of the housing  requirements, and market analysis is not mandatory. DOD policy also  states that master plans for housing should address, among other things,  military housing requirements.

The Air Force’s current housing requirements and market analysis for  Okinawa do not reflect current plans. While the Marine Corps has  provided the Air Force with the number of Marines that will remain on  Okinawa following the full implementation of all realignment initiatives, the  Air Force office responsible for family housing on Okinawa has not been  able to update its housing requirements and market analysis, and housing  master plan, because the Marine Corps has yet to provide the Air Force  with the incremental schedule and unit movements associated with the  realignment initiatives on Okinawa. According to Marine Corps officials,  the Marine Corps cannot provide incremental data until bilateral  negotiations on the Okinawa Consolidation initiative and the subsequent  master plan are finalized. Air Force officials told us that while they plan to  update their housing requirements and market analysis in the summer of  2013, this will only cover the next 5 years. Considering that the  realignment initiatives in Okinawa have no definitive timelines and may  potentially take decades to complete, the Air Force office responsible for  family housing on Okinawa told us that it needs a better understanding of  when facilities will be constructed and units moved over the next 10-15  years. This incremental data will help Air Force officials conduct housing  analyses and develop housing plans based on more short-term and  intermediate housing requirement needs on Okinawa.

Until the Air Force knows what the incremental Marine Corps housing  requirements will be for all phases of the realignment initiatives in  Okinawa, it will not have sufficient information to project housing demand  and assess the housing sustainment cost for the current realignment  plan. As a result, the Air Force will not be able to determine how to  sustain its housing inventory on Okinawa in a cost-effective manner,  which could lead to overinvesting in certain housing areas and  underinvesting in others. Without identifying sustainment needs for all its  infrastructure that will be used until the realignment and consolidation  actions are implemented, DOD risks not having the information necessary  to make informed decisions about maintaining its infrastructure at an  acceptable level to carry out its mission.

section_title: DOD Has Not Accounted for the Marine Realignment in Its Housing Plans on Guam, and Housing Cost Data Are Limited
paragraphs: DOD is in the process of developing plans to meet the housing needs for  U.S. forces on Guam, but these plans will not take into account the  housing requirements associated with the current realignment. According  to Joint Region Marianas officials, Joint Region Marianas is responsible  for overseeing all military housing on Guam, but Naval Base Guam and  Naval Support Activity, Andersen, are each responsible for implementing  their own housing operations. Joint Region Marianas and its installations  face many of the challenges associated with sustaining aging housing  units that we reported are being experienced by the Air Force on  Okinawa. A June 2012 assessment of housing on Naval Base Guam  found housing deficiencies such as mold, broken windows, and  inoperative fans and ventilation systems. While in Guam, we observed  several unoccupied housing units that showed significant pest infestation  and mold growth in their interiors and heavy vegetation and mold growth  on their exteriors. Figure 13 shows pictures of some of the housing units  we observed.

There is currently a surplus of military family housing on Guam. As of  January 2013, approximately 67 percent of available military housing on  Guam—1,577 housing units—are occupied, and 785 units remain  vacant. In addition, there are 311 additional housing units that have  been classified as inactive, which according to Joint Region Marianas  officials, means that those units are viewed as uninhabitable and are no  longer considered part of the active housing inventory. Joint Region  Marianas officials said that the low occupancy rate in their housing units  can be attributed to several factors. First, since many servicemembers  are eligible to live off base, many choose to do so to enjoy the benefits of  living in the local community. Many servicemembers also choose to  reside in private housing to take advantage of the high overseas housing  allowance and utilities stipend. According to the Defense Finance and  Accounting Service, in 2011 approximately 3,800 personnel from the Air  Force, Army, Navy and Marine Corps who were stationed on Guam  received a combined total of $96.1 million in overseas housing allowance.  Under the auspices of Joint Region Marianas, both Naval Base Guam  and Andersen Air Force Base have developed housing plans that seek to  address the low occupancy rate in their on-base housing and make more  effective and efficient use of their housing inventories. To increase the  occupancy rate, Joint Region Marianas officials are assessing several  alternatives, including revising their housing policy to make more DOD- civilians eligible to reside in military housing, requiring more  servicemembers to reside in military housing, and reducing the number of  housing units in the inventory. However, Joint Region Marianas officials  informed us that, until the Marine Corps completes its requirements  determination, arrival dates, and housing policy, none of their alternatives  or plans will consider housing requirements associated with the current  Marine Corps realignment plan that will eventually send nearly 5,000  Marines to Guam. Moreover, they said that they do not have plans to set  aside and sustain existing facilities to support the realignment of Marines.

Joint Region Marianas officials informed us that, because of the  uncertainty regarding when Marines will begin relocating to Guam, they  had decided to proceed with developing housing plans independently of  the Marine Corps realignment initiative. They explained that delaying  action on meeting their housing needs could adversely affect their ability  to provide housing to servicemembers currently stationed on Guam.  Initially, Joint Region Marianas was making preparations to support the  Marine realignment. The Department of the Navy had conducted a  housing requirements and market analysis to identify the demand for  military housing on Guam based on the Marine Corps requirements  associated with the previous realignment plan. Joint Region Marianas had  identified surplus housing units that could have been used to provide  transitional housing for Marines relocating to Guam. However because of  the delay of the realignment and reduced number of troops relocating, the  Marine Corps data that the Navy used when it conducted its housing  requirements and market analysis were no longer valid. Because no firm  requirements or a time frame for the realignment are available, Joint  Region Marianas officials are currently only addressing the housing  issues directly relevant to its immediate needs.

DOD data on the cost of maintaining vacant and inactive housing on  Guam are limited. Joint Region Marianas officials said that they have  yet to determine the average cost of maintaining a vacant or inactive  housing unit on Guam. Officials from Andersen Air Force Base estimated  that the average annual cost of maintaining an inactive unit on the Air  Force Base, including the cost of providing electrical power and ground  maintenance, is approximately $4,500 per house. However, Joint Region  Marianas officials said that similar data have not been calculated for Navy  housing on Guam. Joint Region Marianas officials told us that Navy  housing units on Guam can be found both on the military installations and  embedded in the local community and that, because different types of  costs are involved for the two types of housing units, it becomes difficult  to determine an average cost for maintaining inactive housing units. For  example, officials stated that certain services, like fire protection and  security, for Navy housing units located on military installations would be  incorporated into the base operating support expenses for that  installation; however, for certain Navy housing units embedded in the  local community, officials stated that Joint Region Marianas would pay for  these services from accounts other than base operating support, and it  may be difficult to isolate and merge this data.

DOD guidance on economic analysis for decision making states that the  purpose of such an analysis is to give decision makers insight into  economic factors bearing on accomplishing a project’s objectives and that  alternatives must be fully investigated and a determination made on  whether an alternative satisfies the functional requirements for the  project. This guidance also indicates that, as part of assessing the costs  and benefits of alternatives, an economic analysis should include all  measurable costs and benefits to the federal government that are incident  to achieving the stated objectives of the project. However, without the  Marine Corps housing requirements being considered and the total costs  of maintaining vacant and inactive housing units known, Joint Region  Marianas’ planned assessment of alternatives will not fully measure the  costs and benefits to the federal government of its housing plans. As a  result, decision makers will not have sufficient information to identify an  investment strategy that addresses both Joint Region Marianas’ current  housing needs and the Marine Corps’ housing requirements once the  realignment is completed.

section_title: Conclusions
paragraphs: DOD believes that rebalancing and strengthening its posture in the Asia- Pacific region offers many advantages, including reassuring allies and  partners in the region of the United States’ commitment and shaping the  security environment, while also providing forward capabilities to deter  and defeat aggression. However, in an era of significant budgetary  pressures and competition for resources, it is important to conduct  detailed planning, supported by comprehensive cost information, to  ensure that DOD is making the most efficient use of its resources.  Although DOD has revised its plan to relocate Marines off Okinawa, it has  yet to identify the total costs, requirements, or sustainability of a move  that will realign Marine Corps forces throughout the Pacific. In our  assessment of DOD’s preliminary estimate for the realignment, we found  that DOD’s estimate is not reliable because it omits potentially critical cost  elements such as mobility support and risk parameters tied to the  assumptions, and lacks detailed information on requirements for several  key cost components that are needed to capture all costs related to the  realignment. According to DOD officials, specific requirements and their  associated costs cannot be developed for each cost component until the  necessary environmental analyses and host nation negotiations have  been completed. Still, we found that DOD did not include some up-front  practices that could have provided a more reliable estimate and could  have been done despite the fact that the environmental analyses and  host nation negotiations are not complete. Office of Management and  Budget guidance indicates that it is a best practice to continuously update  the cost estimating process to keep estimates current, accurate, and  valid; and DOD’s overview of its fiscal year 2013 budget states that DOD  cannot continue the practice of starting programs that prove to be  unaffordable and that it will work to achieve program affordability by  working to ensure programs start with firm cost goals in place,  appropriate priorities set, and necessary trade-offs made to keep  programs within affordable limits. Without comprehensive cost estimates  developed for the realignment plan, DOD will be hampered in achieving  its affordability goal of not starting a program without firm costs goals in  place. DOD acknowledges that it will be 2018 or later before an integrated  master plan can be completed to provide Congress with the necessary  information it needs on all of the specific projects, requirements,  schedules, and costs to aid it in its decision making regarding the  realignment of Marines in the Pacific. However, DOD has made a first  step in capturing some of its planning information including integrated  schedules of its planned actions in its synchronization matrix. While we  acknowledge that this type of information will periodically change as  environmental analyses and negotiations are completed, and plans start  to be implemented, this type of information would provide Congress with  current plans in the interim until such time that the integrated master plan  can be completed.

Furthermore, it is unknown what the government of Japan’s long-term  construction schedule will be for building the infrastructure to complete its  plans for Iwakuni and Okinawa. DOD currently has not developed a  strategy to identify the resources it needs to assist with the development  and oversight of these projects that may involve a surge in concurrent  construction. Without a strategy, DOD will not have the safeguards in  place to help ensure facilities are being built to standard and that  problems that already existed on a smaller scale are not magnified.  Finally, uncertainties surrounding this realignment have disrupted  planning for current facilities and family housing on Okinawa, and family  housing on Guam, leaving the potential for hundreds of millions of dollars  in unplanned sustainment projects in the future. Without developing  comprehensive cost estimates and further planning to support the  realignment, DOD risks requesting realignment funds without fully  determining requirements, and Congress may be asked to fund  requirements without knowing the full cost. Furthermore, without  developing updated sustainment plans on both Okinawa and Guam, DOD  lacks reasonable assurance that it will have adequate facilities to support  operations and the lives, health, and safety of servicemembers and their  families.

section_title: Recommendations for Executive Action
paragraphs: To provide DOD and Congress with more reliable information to inform  investment decisions associated with the realignment of Marines and U.S.  military posture in the Pacific, we recommend that the Secretary of  Defense update the current cost estimate to include additional estimates  for mobility support, and additional analysis that would quantify the risk  impacts and parameters to account for its various assumptions changing.  Furthermore, as appropriate environmental analyses and host nation  negotiations are completed, update the estimate with comprehensive cost  estimates (as identifiable) that factor in and include the following seven  cost components associated with the current realignment plan:

Guam Physical Layout and Requirements;

Housing Requirements on Guam;

Requirements to Upgrade Utilities and Infrastructure on Guam;

Joint Training Range Complex Requirements including associated  environmental mitigation in the Northern Marianas;

Marine Corps Requirements for Australia;

Marine Corps Requirements for Hawaii and Other U.S. Locations;

Mobility requirements to support the current realignment plan to  conduct routine operations, training, and any contingency situations.

To provide DOD and Congress with sufficient information to make  informed decisions about the sequencing of projects supporting the  realignment of Marines and the interdependent projects on Okinawa and  about the timing for the funding needed to simultaneously support these  projects and those already planned on mainland Japan, we recommend  that the Secretary of Defense take the following two actions:

As the master planning process continues over the next several  years, require the Secretary of the Navy to develop annual updates on  the status of planning efforts for appropriate congressional  committees until such time as master plans are completed for each  geographic segment of the realignment. These updates should  include, but not be limited to, providing congressional committees with  up-to-date information on the status of initiatives, identified  requirements and time frames, and any updated cost information  linked to specific facilities or projects.

Direct the Secretary of the Army to require the Army Corps of  Engineers to coordinate with appropriate military service officials  involved in the planning and management of DPRI projects in Japan,  including U.S. Forces–Japan, Marine Corps Installations Pacific, and  Marine Corps Headquarters, to develop a strategy to identify how the  design and construction process of DPRI projects should be handled  moving forward and the necessary resources needed to support any  surge in construction associated with posture-related initiatives in both  Iwakuni and Okinawa.

To aid DOD and Congress in obtaining sufficient information to make  prudent investment decisions for the sustainment of U.S. forces on  Okinawa and Guam while implementing the planned movements  associated with the realignment of Marines and the consolidation efforts  on Okinawa, we recommend that the Secretary of Defense take the  following three actions:

Direct the appropriate service officials to update Okinawa installation  master plans to include sustainment requirements and the costs to  sustain the U.S. presence on Okinawa until the Marine realignment  and Okinawa consolidation efforts are completed. At a minimum,  these plans should identify both short-term needs and long-term  needs to account for the uncertainty regarding the time needed to  implement the realignment and consolidation initiatives on Okinawa.

Direct appropriate service officials to provide, as they become  available, annual master schedule and unit movement updates  associated with the realignment initiatives on Okinawa to the  appropriate Air Force officials. These updates should include any  updated housing requirements such as the demographics of Marine  families required to be housed on Okinawa during the future phases  of the realignment initiatives on Okinawa, thus allowing the  appropriate Air Force officials to perform up-to-date assessments and  develop housing investment strategies reflecting the updated  schedule and housing requirements.

Direct the Secretary of the Navy to conduct an economic analysis to  include assessing the costs of maintaining vacant housing on Guam  to arrive at an informed decision weighing the cost of maintaining or  renovating this housing versus the construction of new facilities to  support the requirements for the Marine Corps realignment to Guam.

section_title: Agency Comments and Our Evaluation
paragraphs: In written comments on a draft of this report, DOD fully concurred with  five of our recommendations, partially concurred with two  recommendations, and stated it would work with DOD components to  implement the recommendations. While DOD agreed with the content of  the report and the recommendations, the department expressed concern  with the report’s title. DOD believes the title suggests the department  currently has the ability to produce comprehensive cost estimates and  complete planning for the realignment initiatives but has not done so. Our  report title Defense Management: More Reliable Cost Estimates and  Further Planning Needed to Inform the Marine Corps Realignment  Initiatives in the Pacific conveys that more reliable estimates and  comprehensive planning will be needed to inform decision makers. We  acknowledged in our report that DOD will not be in a position to provide  comprehensive cost estimates and complete planning documentation for  the realignment to Congress until the environmental studies and host  nation negotiations have been completed. However, it is important to  ensure that Congress is aware that current cost estimates provided to  them to date are not reliable because they are incomplete for the reasons  stated above and in our report. As a result, we did not change the title of  the report.

DOD partially concurred with our recommendation to update its current  cost estimate for the realignment to include additional estimates for  mobility support, and additional analysis that would quantify the risk  impacts and parameters to account for its various assumptions changing.  DOD stated that it is in the process of responding to requirements  contained in Section 2832 of the National Defense Authorization Act for  Fiscal Year 2013, which also requires an assessment of the necessary  strategic and logistical resources. However, the provision does not  specifically require DOD to include risk impacts and parameters.  Furthermore, DOD stated that estimates for mobility support will not be  available until the department completes the required environmental  planning documents. As our report states, we acknowledge that  comprehensive estimates for most costs tied to the realignment cannot be  completed until appropriate environmental analyses and host nation  negotiations are complete. However, we believe DOD should update its  current estimate to include risk parameters to produce a more reliable  cost estimate by accounting for potential cost fluctuations (if its  assumptions change) and include an initial estimate for mobility support,  a cost that DOD officials told us could be considerable.

DOD concurred with our recommendation to update the cost estimate for  the realignment with comprehensive estimates as environmental analysis  and host nation negotiations are completed and consequently more  specific data becomes available on seven specific cost components  including Guam physical layout and requirements; housing and utilities  infrastructure on Guam; joint or Marine Corps training and other  requirements in the Northern Marianas, Australia, and Hawaii; and  mobility requirements. DOD stated that it plans to identify and incorporate  comprehensive cost estimates as they become available upon completion  of necessary environmental planning documents.

DOD also concurred with our recommendation that the Secretary of  Defense direct the Secretary of the Navy to provide annual updates on  the status of master planning efforts to the appropriate congressional  committees, until such time as master plans are completed for each  geographic segment of the realignment.

DOD partially concurred with our recommendation to require the Army  Corps of Engineers to coordinate with appropriate military service officials  to develop a strategy to identify how the design and construction process  of Defense Policy Review Initiative projects should be handled moving  forward, and the necessary resources needed to support any surge in  construction in both Iwakuni and Okinawa. DOD noted that it would take  these steps, but stated that the effort necessarily relies upon a detailed  master plan that has been coordinated among several organizations  within DOD in order to identify the necessary resources to support a  surge in construction. We agree that developing a master plan is the first  step, and coordination with the various DOD organizations will be  required to complete this task.

DOD concurred with our recommendation to update Okinawa installation  master plans to include sustainment requirements and the costs to  sustain the U.S. presence on Okinawa until the Marine realignment and  Okinawa consolidation efforts are completed. DOD stated that the  completion of the bilateral Okinawa Consolidation Plan in April 2013  removed much uncertainty and will allow the development of more  detailed master plans for each camp.

DOD concurred with our recommendation to provide, as they become  available, annual master schedule and unit movement updates  associated with the realignment initiatives on Okinawa to the appropriate  Air Force officials including updated housing requirements and  demographics of Marine Corps families required to be housed on  Okinawa. DOD stated it will direct U.S. Pacific Command and the Marine  Corps to provide current fiscal and unit movement data to the Air Force,  and update as plans are reviewed and revised.

DOD concurred with our recommendation to conduct an economic  analysis to include assessing the costs of maintaining vacant housing on  Guam. DOD stated that the Navy is conducting a housing market analysis  to establish a baseline for long-term military family housing requirements  on Guam and that, once the baseline requirements are established, the  Navy will conduct a cost/benefit analysis for addressing new requirements  related to the Marine Corps realignment.

We also provided the Department of State with a draft of this report for  official comment, but it declined to comment since the report contains no  recommendations for the Department of State. DOD and State provided  technical comments separately that were incorporated into the report as  appropriate. DOD’s written comments are reprinted in appendix VI.

We are sending copies of this report to appropriate congressional  committees, the Secretary of Defense; the Secretaries of the Army, Navy,  and Air Force; the Commandant of the Marine Corps; the Secretary of  State; the Director, Office of Management and Budget; and appropriate  organizations. In addition, this report will be available at no charge on our  website at http://www.gao.gov.

If you or your staff has any questions about this report, please contact me  at (202) 512-4523 or leporeb@gao.gov. Contact points for our Offices of  Congressional Affairs and Public Affairs may be found on the last page of  this report. GAO staff who made major contributions to this report are  listed in appendix VII.

section_title: Appendix I: Scope and Methodology
paragraphs: To evaluate defense posture initiatives in the Asia-Pacific region, we  interviewed and collected information from various Department of  Defense (DOD) officials including:

Office of the Under Secretary of Defense (Policy);

Department of the Army;

Department of the Air Force;

Department of the Navy;

U.S. Pacific Command and its Army, Navy, Marine Corps, and Air

U.S. Forces–Japan and its Army, Navy, Marine Corps, and Air Force

U.S. Army Corps of Engineers and its Japan Engineering District;

Joint Region Marianas; and  Joint Guam Program Office.

We conducted site visits to

Yokota Air Base and Marine Corps Air Station Iwakuni in mainland

Kadena Air Base, Camps Schwab and Kinser, and Marine Corps Air  Station Futenma on Okinawa;

Andersen Air Force Base and several Naval installations on Guam;  and  the proposed training locations on Tinian.

Specifically, to determine the extent to which DOD has developed  comprehensive plans and cost estimates for the realignment of Marines,  we interviewed appropriate DOD and State Department officials, collected  plans and cost estimates related to this initiative, and applied the best  practices included in the GAO Cost Estimating and Assessment Guide to  our assessment of the available data. In addition to the agencies listed  above, we interviewed and collected data from officials in the Office of the  Under Secretary of Defense (Comptroller), Director, Cost Assessment  and Program Evaluation; the Joint Staff; the Office of Economic  Adjustment; U.S. Transportation Command; the Defense Logistics  Agency; the Naval Center for Cost Analysis; and U.S. Embassy in Tokyo,  Japan, and U.S. Consulate in Naha, Okinawa. For this review, we  collected DOD plans and cost estimates associated with the original and  current Marine realignment plans, DOD budget data on U.S. projects  related to the Defense Posture Review Initiative (DPRI) and the Marine  realignment, budget data on DPRI and Host Nation Support expenditures  provided to DOD by the government of Japan, military base master plans  and housing requirements analyses, and other relevant documentation.

To assess the comprehensiveness of DOD’s realignment cost estimate,  we analyzed DOD’s plans, cost analyses, and cost estimating process  and compared them with the best practices included in the GAO Cost  Estimating and Assessment Guide.

To determine the extent to which DOD has planned for and synchronized  other U.S. defense posture movements in Okinawa and Japan to coincide  with the Marine Corps realignment, we reviewed planning documentation  associated with these posture movements for completeness and  coordination. We interviewed and collected relevant planning  documentation from officials in the DOD offices listed above. We  compared the data we received from each component within the Marine  Corps to one another, and compared the data we collected from U.S.  Pacific Command, U.S. Forces–Japan, the Joint Guam Program Office,  and the Office of the Secretary of Defense to determine the status of  planning consistencies and synchronization. We evaluated these plans  with criteria established in relevant DOD guidance and Key Elements for  Developing a Strategy.

To determine the extent to which DOD has identified a plan to sustain its  current forces on Okinawa and Guam, we interviewed the DOD officials  listed above and conducted site visits where we observed the conditions  of facilities and housing, collected appropriate planning documentation  and cost data, and assessed the data against GAO cost estimating  guidance and DOD planning guidance. We interviewed officials to identify  DOD requirements and plans for sustaining U.S. forces on Okinawa until  realignment efforts are completed. We collected sustainment planning  documentation, base master plans, and historical host nation support and  U.S. sustainment cost data for Okinawa and compared them to GAO cost  estimating guidance and DOD guidance on installation master planning to  determine the extent to which DOD has planned for the sustainment of  U.S. forces on Okinawa until realignment efforts are completed. We  interviewed officials to determine the extent to which they have planned  for the sustainment of family housing on Guam, reviewing planning  documentation and analyzing current cost data collection methodologies  used by the Air Force and the Navy. We compared sustainment plans to  criteria established by relevant DOD guidance on economic analysis for  decision making and installation master planning.

To determine the reliability of the numerical data provided to us by DOD  organizations, we collected information on how the data was collected,  managed, and used through interviews and a survey provided to relevant  DOD officials. By assessing this information against GAO data quality  standards, we determined that the data presented in our findings were  sufficiently reliable for the purposes of this report.

We conducted this performance audit from November 2011 to March  2013, in accordance with generally accepted government auditing  standards. Those standards require that we plan and perform the audit to  obtain sufficient, appropriate evidence to provide a reasonable basis for  our findings and conclusions based on our audit objectives. We believe  the evidence obtained provides a reasonable basis for our findings and  conclusions based on our audit objectives.

section_title: Appendix II: April 2012 Joint Statement of the United States-Japan Security Consultative Committee

section_title: Appendix III: Restrictions on Use of Funds For Marine Corps Realignment in National Defense Authorization Act for Fiscal Years 2013 and 2012
paragraphs: National Defense Authorization Act for Fiscal Year 2013SEC. 2831. CERTIFICATION OF MILITARY READINESS NEED FOR A  LIVE FIRE TRAINING RANGE COMPLEX ON GUAM AS CONDITION  ON ESTABLISHMENT OF RANGE COMPLEX.

A Live Fire Training Range Complex on Guam may not be established  (including any construction or lease of lands related to such  establishment) in coordination with the realignment of United States  Armed Forces in the Pacific until the Secretary of Defense certifies to the  congressional defense committees that there is a military training and  readiness requirement for the Live Fire Training Range Complex.

SEC. 2832. REALIGNMENT OF MARINE CORPS FORCES IN ASIA- PACIFIC REGION.  (a) RESTRICTION ON USE OF FUNDS FOR REALIGNMENT.— Except as provided in subsection (c), none of the funds authorized to  be appropriated under this Act, and none of the amounts provided by  the Government of Japan for construction activities on land under the  jurisdiction of the Department of Defense, may be obligated to  implement the realignment of Marine Corps forces from Okinawa to  Guam or Hawaii until each of the following occurs:  (1) The Commander of the United States Pacific Command  provides to the congressional defense committees an assessment  of the strategic and logistical resources needed to ensure the  distributed lay-down of members of the Marine Corps in the United  States Pacific Command Area of Responsibility meets the  contingency operations plans.  (2) The Secretary of Defense submits to the congressional  defense committees master plans for the construction of facilities  and infrastructure to execute the Marine Corps distributed lay- down on Guam and Hawaii, including a detailed description of  costs and the schedule for such construction.  (3) The Secretary of the Navy submits a plan to the congressional  defense committees detailing the proposed investments and  schedules required to restore facilities and infrastructure at Marine  Corps Air Station Futenma.  (4) A plan coordinated by all pertinent Federal agencies is  provided to the congressional defense committees detailing  descriptions of work, costs, and a schedule for completion of  construction, improvements, and repairs to the non-military  utilities, facilities, and infrastructure, if any, on Guam affected by  the realignment of forces.  (b) RESTRICTION ON DEVELOPMENT OF PUBLIC  INFRASTRUCTURE.—  If the Secretary of Defense determines that any grant, cooperative  agreement, transfer of funds to another Federal agency, or  supplement of funds available in fiscal year 2012 or 2013 under  Federal programs administered by agencies other than the  Department of Defense will result in the development (including  repair, replacement, renovation, conversion, improvement, expansion,  acquisition, or construction) of public infrastructure on Guam, the  Secretary of Defense may not carry out such grant, transfer,  cooperative agreement, or supplemental funding unless such grant,  transfer, cooperative agreement, or supplemental funding is  specifically authorized by law.  (c) EXCEPTIONS TO FUNDING RESTRICTION.—The Secretary of  Defense may use funds described in subsection (a)—  (1) to complete additional analysis or studies required under the  National Environmental Policy Act of 1969 (42 U.S.C. 4321 et  seq.) for proposed actions on Guam or Hawaii;  (2) to initiate planning and design of construction projects at  Andersen Air Force Base and Andersen South; and  (3) to carry out any military construction project for which an  authorization of appropriations is provided in section 2204, as  specified in the funding table in section 4601.  (d) DEFINITIONS.—In this section:  (1) DISTRIBUTED LAY-DOWN.—The term ‘‘distributed laydown’’  refers to the planned distribution of members of the Marine Corps  in Okinawa, Guam, Hawaii, Australia, and possibly elsewhere that  is contemplated in support of the joint statement of the United  States–Japan Security Consultative Committee issued April 26,  2012, in the District of Columbia (April 27, 2012, in Tokyo).  (2) PUBLIC INFRASTRUCTURE.—The term ‘‘public  infrastructure’’ means any utility, method of transportation, item of  equipment, or facility under the control of a public entity or State or  local government that is used by, or constructed for the benefit of,  the general public.  (e) REPEAL OF SUPERSEDED LAW.—Section 2207 of the Military  Construction Authorization Act for Fiscal Year 2012 (division B of  Public Law 112-81; 125 Stat. 1668) is repealed.

National Defense Authorization Act for Fiscal Year 2012SEC. 2207. GUAM REALIGNMENT.  (a) RESTRICTION ON USE OF FUNDS.—Except as provided in  subsection (c), notwithstanding any other provision of law, none of the  funds authorized to be appropriated under this Act, and none of the  amounts provided by the Government of Japan for military  construction activities on land under the jurisdiction of the Department  of Defense, may be obligated to implement the realignment of United  States Marine Corps forces from Okinawa to Guam as envisioned in  the United States–Japan Roadmap for Realignment Implementation  issued May 1, 2006, until—  (1) the Commandant of the Marine Corps, in consultation with the  Commander of the United States Pacific Command, provides the  congressional defense committees the Commandant’s preferred  force lay-down for the United States Pacific Command Area of  Responsibility;  (2) the Secretary of Defense submits to the congressional defense  committees a master plan for the construction of facilities and  infrastructure to execute the Commandant’s preferred force lay- down on Guam, including a detailed description of costs and a  schedule for such construction;  (3) the Secretary of Defense certifies to the congressional defense  committees that tangible progress has been made regarding the  relocation of Marine Corps Air Station Futenma;  (4) a plan coordinated by all pertinent Federal agencies is  provided to the congressional defense committees detailing  descriptions of work, costs, and a schedule for completion of  construction, improvements, and repairs to the non-military  utilities, facilities, and infrastructure on Guam affected by the  realignment of forces; and  (5) the Secretary of Defense—  (A) submits to the congressional defense committees the  report on the assessment of the United States force posture in  East Asia and the Pacific region required under section 346 of  this Act; or  (B) certifies to the congressional defense committees that the  deadline established under such section for the submission of  such report has not been met.  (b) DEVELOPMENT OF PUBLIC INFRASTRUCTURE.—  (1) AUTHORIZATION REQUIRED.—Notwithstanding any other  provision of law, if the Secretary of Defense determines that any  grant, cooperative agreement, transfer of funds to another Federal  agency, or supplement of funds available in fiscal year 2012 under  Federal programs administered by agencies other than the  Department of Defense will result in the development (including  repair, replacement, renovation, conversion, improvement,  expansion, acquisition, or construction) of public infrastructure on  Guam, such grant, transfer cooperative agreement, or  supplemental funding shall be specifically authorized by law.  (2) PUBLIC INFRASTRUCTURE DEFINED.—In this section, the  term ‘‘public infrastructure’’ means any utility, method of  transportation, item of equipment, or facility under the control of a  public entity or State or local government that is used by, or  constructed for the benefit of, the general public.  (c) EXCEPTION TO RESTRICTION ON USE OF FUNDS.—The  Secretary of Defense may use funds described in subsection (a) to  carry out additional analysis under the National Environmental Policy  Act of 1969 to include the following actions:  (1) A re-evaluation of live-fire training range complex alternatives,  based upon the application of probabilistic modeling; and  (2) The ongoing analysis on the impacts of the realignment and  build-up on Guam as described in subsection (a) on coral reefs in  Apra Harbor, Guam.

section_title: Appendix IV: Print-Friendly Version of Figure I

section_title: Appendix V: Funded Defense Policy Review Initiative (DPRI)-Related Military Construction Projects on Guam Supporting Marine Realignment
paragraphs: Estimated  budget (dollars  in millions)

Cost incurred  from inception  to December  31, 2012  (dollars in  millions)

Estimated  remaining cost  to complete  (dollars in  millions)

section_title: Appendix VI: Comments from the Department of Defense

section_title: Appendix VII: GAO Contact and Staff Acknowledgments
subsections: section_title: GAO Contact

section_title: Staff Acknowledgements
paragraphs: In addition to the contact named above, Laura Durland, Assistant  Director; Jeff Hubbard; Gilbert Kim; Joanne Landesman; Ying Long;  Charles Perdue; Carol Petersen; Karen Richey; Michael Shaughnessy;  Amie Steele; and Lindsay Taylor made key contributions to this report.

section_title: Related GAO Products
paragraphs: Force Structure: Improved Cost Information and Analysis Needed to  Guide Overseas Military Posture Decisions. GAO-12-711. Washington,  D.C.: June 6, 2012.

Military Buildup on Guam: Costs and Challenges in Meeting Construction  Timelines. GAO-11-459R. Washington, D.C.: June 27, 2011.

Defense Infrastructure: The Navy Needs Better Documentation to  Support Its Proposed Military Treatment Facilities on Guam.  GAO-11-206. Washington, D.C.: April 5, 2011.

Defense Management: Additional Cost Information and Stakeholder Input  Needed to Assess Military Posture in Europe. GAO-11-131. Washington,  D.C.: February 3, 2011.

Defense Planning: DOD Needs to Review the Costs and Benefits of  Basing Alternatives for Army Forces in Europe. GAO-10-745R.  Washington, D.C.: September 13, 2010.

Defense Management: Improved Planning, Training, and Interagency  Collaboration Could Strengthen DOD’s Efforts in Africa. GAO-10-794.  Washington, D.C.: July 28, 2010.

Defense Management: U.S Southern Command Demonstrates  Interagency Collaboration, but Its Haiti Disaster Response Revealed  Challenges Conducting a Large Military Operation. GAO-10-801.  Washington, D.C.: July 28, 2010.

National Security: Interagency Collaboration Practices and Challenges at  DOD’s Southern and Africa Commands. GAO-10-962T. Washington,  D.C.: July 28, 2010.

Defense Infrastructure: Guam Needs Timely Information from DOD to  Meet Challenges in Planning and Financing Off-Base Projects and  Programs to Support a Larger Military Presence. GAO-10-90R.  Washington, D.C.: November 13, 2009.

Defense Infrastructure: DOD Needs to Provide Updated Labor  Requirements to Help Guam Adequately Develop Its Labor Force for the  Military Buildup. GAO-10-72. Washington, D.C.: October 14, 2009.

Ballistic Missile Defense: Actions Needed to Improve Planning and  Information on Construction and Support Costs for Proposed European  Sites. GAO-09-771. Washington, D.C.: August 6, 2009.

Force Structure: Actions Needed to Improve DOD’s Ability to Manage,  Assess, and Report on Global Defense Posture Initiatives. GAO-09-706R.  Washington, D.C.: July 2, 2009.

Defense Infrastructure: Planning Challenges Could Increase Risks for  DOD in Providing Utility Services When Needed to Support the Military  Buildup on Guam. GAO-09-653. Washington, D.C.: June 30, 2009.

Defense Management: Actions Needed to Address Stakeholder  Concerns, Improve Interagency Collaboration, and Determine Full Costs  Associated with the U.S. Africa Command. GAO-09-181. Washington,  D.C.: February 20, 2009.

Defense Infrastructure: Opportunity to Improve the Timeliness of Future  Overseas Planning Reports and Factors Affecting the Master Planning  Effort for the Military Buildup on Guam. GAO-08-1005. Washington, D.C.:  September 17, 2008.

Force Structure: Preliminary Observations on the Progress and  Challenges Associated with Establishing the U.S. Africa Command.  GAO-08-947T. Washington, D.C.: July 15, 2008.

Defense Infrastructure: Planning Efforts for the Proposed Military Buildup  on Guam Are in Their Initial Stages, with Many Challenges Yet to Be  Addressed. GAO-08-722T. Washington, D.C.: May 1, 2008.

Defense Infrastructure: Overseas Master Plans Are Improving, but DOD  Needs to Provide Congress Additional Information about the Military  Buildup on Guam. GAO-07-1015. Washington, D.C.: September 12,  2007.

Military Operations: Actions Needed to Improve DOD’s Stability  Operations Approach and Enhance Interagency Planning. GAO-07-549.  Washington, D.C.: May 31, 2007.

Defense Management: Comprehensive Strategy and Annual Reporting  Are Needed to Measure Progress and Costs of DOD’s Global Posture  Restructuring. GAO-06-852. Washington, D.C.: September 13, 2006.


Question-summary annotations: questions: question: How accurate is the DOD's cost estimate for its current realignment plan?
answer: The Department of Defense's (DOD) preliminary cost estimate for its current realignment plan is not reliable, because it is missing costs and is based on limited data.
child_questions: question: Why can't the DOD form a more precise estimate?
answer: According to DOD officials, DOD has not yet been able to put together a more reliable cost estimate because it will not have specific detailed information on the plan's requirements until the completion of environmental analyses and host nation negotiations.

question: What is the current estimate?
answer: Currently, DOD estimates that it would cost approximately $12.1 billion to implement its realignment plan--not including the Australia segment of the realignment.

question: How could DOD make the estimate more reliable only using their current information?
answer: Still, GAO found that DOD did not include some up-front practices that could have provided a more reliable estimate that are not dependent on the completion of the environmental analyses and host nation negotiations. Specifically, DOD omitted any costs associated with mobility support, a critical component of the implementation, from its cost estimate. Furthermore, although DOD based its cost estimate on several assumptions, there was no evidence DOD conducted analysis needed to determine the reliability of those assumptions.

question: Why is the lack of a reliable estimate troubling?
answer: Without a reliable estimate, DOD will not be able to provide Congress and other stakeholders with the information Congress needs to make informed decisions regarding the realignment.

questions: question: To what extent has the DOD planned for its realignment initiatives?
answer: DOD has not developed an integrated master plan for its current realignment plan, and it has not developed a strategy to support the development and oversight of the Japanese construction projects associated with other realignment initiatives.
child_questions: question: What is needed to create a fully-formed master plan?
answer: DOD has taken initial steps to develop an integrated scheduling document based on currently known data, but indicated that specific requirements, schedules, and costs cannot be formalized in an integrated master plan until several studies and host nation negotiations are completed, which will take several years.

question: How could a master plan affect the realignment?
answer: Developing a master plan could enhance the management of the realignment by creating a systematic approach to planning, scheduling, and execution.

question: What other aspects of planning has DOD neglected?
answer: In addition, DOD has not developed a strategy that identifies the resources needed to support the development of and oversight for these projects.

question: Why is the lack of planning a cause for concern?
answer: Without the information contained in an integrated master plan and a construction support strategy, Congress will be unable to make informed decisions about the order in which it needs to provide funding to support the realignment.

questions: question: How has DOD been planning for the sustainment of US forces on Okinawa and Guam?
answer: DOD has taken some steps to plan for the sustainment of U.S. forces on Okinawa and Guam, but it has yet to fully identify sustainment needs and costs for both locations during this period.
child_questions: question: Why is infrastructure maintenance planning needed?
answer: At several installations on Okinawa, some of the infrastructure has severely deteriorated. DOD facilities planning guidance calls for updated facility master plans that capture requirements and propose solutions.

question: How might DOD make use of unoccupied housing?
answer: On Guam, DOD has been maintaining an inventory of unoccupied family housing that could potentially be used for Marines relocating to Guam.
child_questions: question: How well has DOD analyzed the cost-benefits of this idea?
answer: However, DOD has not determined all the costs and benefits of maintaining this housing or the Marines' potential housing requirements--information needed to perform an economic analysis.

question: Why is the lack of a reliable estimate troubling?
answer: Without an estimate of the sustainment requirements for Okinawa, the costs for maintaining housing, and the potential Marine requirements for housing on Guam, DOD will be unable to make informed decisions on whether continued investment in sustaining these facilities is warranted.

questions: question: What does the DOD plan to change with regards to the Asia-Pacific region?
answer: DOD has stated that it intends to rebalance its defense posture toward the Asia-Pacific region.

question: What is the extent of US military presence in the region?
answer: Japan hosts the largest U.S. forward-operating presence in this region; the majority of the U.S. forces in Japan are located in Okinawa.
child_questions: question: How is this presence going to be changed in the near future?
answer: The United States and Japan planned to reduce the U.S. military presence on Okinawa by relocating approximately 9,000 Marines. DOD had originally planned to move the Marines only to Guam, but revised its plans in 2012 to include other locations in the Pacific.

question: What is GAO's role in analyzing the DOD's decision?
answer: Congressional committees have directed GAO to examine DOD's initiatives in the Pacific, focusing on planning and costs.

question: What does this report analyze?
answer: This report discusses the extent to which DOD has (1) developed a comprehensive cost estimate for the realignment of Marines, (2) planned for and synchronized other movements to coincide with the realignment, and (3) identified plans to sustain the force until all initiatives are implemented.
child_questions: question: How did GAO source its data to write the review?
answer: To address these objectives, GAO reviewed relevant policies and procedures, reviewed and analyzed cost documents related to the realignment initiatives, interviewed DOD officials, and conducted site visits at U.S. military installations in the Pacific.