NATO Infrastructure Program:

As Threat Declines, NATO Reduces Expenditures

NSIAD-92-174: Published: May 1, 1992. Publicly Released: May 1, 1992.

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Pursuant to a congressional request, GAO examined how recent political changes in Eastern Europe have affected the North Atlantic Treaty Organization's (NATO) infrastructure program, which provides wartime facilities and equipment for NATO military forces.

GAO found that: (1) by March 1991, NATO had eliminated or deferred projects valued at $1.4 billion and an additional $291 million in November 1991 for projects approved from fiscal year (FY) 1985 through FY 1991; (2) although the United States significantly reduced its FY 1991 appropriation for the NATO infrastructure program, it was able to cover all but over $15 million in 1991 U.S. commitments; (3) NATO revalidated infrastructure projects it had approved in FY 1985 through FY 1991 and has reduced its program by $1.7 billion; (4) U.S. commanders cancelled 57 projects, valued at $414.5 million, and deferred 74 others, totalling about $792 million; (5) higher appropriations may be requested, after FY 1993, unless the infrastructure program is further reduced, primarily because millions in recoupments will remain after FY 1993, a greater percentage of FY 1994 appropriations will be needed to meet prior year commitments, and in 1991, the U.S. stretched its obligation authority as a result of changes in NATO procedures for funding new projects; (6) NATO and U.S. commanders believe that the decreased threat and planned reduction of forces in Europe increase the need for reinforcement forces and associated support infrastructure; (7) the Supreme Allied Commander, Atlantic has cancelled or deferred 18 projects in the last 2 years totalling $203.1 million, while the U.S. Commander in Chief, Atlantic Command (CINCLANT), has deferred 44 future projects, valued at $658.3 million; and (8) projects planned for Keflavik Naval Air Station in Iceland, valued at $178 million, may not be needed, since they would provide capability beyond current requirements.

Recommendations for Executive Action

  1. Status: Closed - Implemented

    Comments: DOD has issued instructions establishing procedures for more timely identification of overseas bases for return to host government.

    Recommendation: To avoid unnecessary NATO infrastructure costs, the Secretary of Defense should endeavor to make base closure announcements in adequate time to prevent contracting for projects no longer required.

    Agency Affected: Department of Defense

  2. Status: Closed - Implemented

    Comments: Instructions have been issued.

    Recommendation: To prevent unnecessary infrastructure expenditures after base closure announcements, the Secretary of Defense should require U.S. European Command officials to work closely with NATO to expedite decisions to cancel unneeded projects.

    Agency Affected: Department of Defense

  3. Status: Closed - Implemented

    Comments: DOD has eliminated all but two projects from its construction plans for the Keflavik Naval Air Station. These two projects have not yet been funded by NATO. They may never be started due to continuing project reviews and cuts by DOD and NATO.

    Recommendation: The Secretary of Defense should instruct CINCLANT to reassess and more fully justify planned NATO infrastructure projects for the Keflavik Naval Air Station that would provide additional capability or may not be supportable because of planned reductions in operation and maintenance funding.

    Agency Affected: Department of Defense


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