Operation Desert Shield/Storm:

Update on Costs and Funding Requirements

NSIAD-92-194: Published: May 8, 1992. Publicly Released: May 28, 1992.

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Pursuant to a congressional request, GAO provided information on the costs and financing of Operations Desert Shield and Desert Storm, focusing on the: (1) status of the Defense Cooperation Account through fiscal year (FY) 1992; (2) extent of future funding requirements; (3) impact of Operation-related and financed revolving fund surpluses on the Department of Defense's (DOD) budget; and (4) status of the Persian Gulf Regional Defense Fund.

GAO found that: (1) contributions to the account will not fully cover estimated incremental costs or funding requirements for the operations; (2) not all operations costs were funded by the account and almost $2.3 billion in contributions and interest should remain in the account by the end of FY 1992; (3) DOD requested additional spending authority to finance Operation-related maintenance requirements for FY 1993, but the amount of funding required has not been fully determined; (4) using Department of Veterans Affairs (VA) data, DOD identified $3.9 billion in future benefits costs for veterans and their spouses; (5) Operation-related and financed surpluses in DOD revolving funds total at least $2.6 billion; and (6) DOD reduced its FY 1993 operation and maintenance budget request to offset an estimated $2-billion surplus in Operation-financed supplies and equipment.

Matters for Congressional Consideration

  1. Status: Closed - Implemented

    Comments: Legislation was passed in September 1992 giving DOD access to remaining defense cooperation accounts funds.

    Matter: Congress should consider using the remaining funds in the Defense Cooperation Account after FY 1992 to reimburse the general fund of the Treasury for operation-related costs already incurred.

  2. Status: Closed - Implemented

    Comments: Legislation was passed in September 1992 terminating the Regional Defense Fund.

    Matter: After Congress has made a decision regarding the remaining Defense Cooperation Account funds, Congress should consider terminating the Persian Gulf Regional Defense Fund as soon as practicable.


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