Operation Desert Shield/Storm

The Office of Management and Budget's (OMB) estimate of $47.5 billion for Operation Desert Shield/Storm funding requirements appears to be overstated. The estimate reflects (1) higher-than-actual costs incurred by the revolving fund accounts, (2) overestimated maintenance needs, (3) replacement of recoverable munitions, and (4) procurements that were canceled due to the operation's short duration. Foreign contributions to the Defense Cooperation Account should fully cover the operation's funding requirements; therefore, the $15 billion appropriated to the Persian Gulf Regional Defense Fund will not be needed. Foreign commitments for cash contributions total $48.3 billion, or about $800 million more than OMB's estimate; 88 percent of the amount pledged has already been contributed. Tracking incremental costs for the operation was difficult because the services only captured the total costs at the unit level and did not subtract the costs they would have normally incurred had there been no crisis in the Persian Gulf. These adjustments were made at the higher reporting levels. Also, cost data are aggregated into broad and general categories that make it hard to verify whether specific costs have been properly charged to the operation.

GAO found: (1) the Office of Management and Budget (OMB) cost estimate of $47.5 billion for Desert Shield/Storm was overstated due to higher-than-actual costs incurred by revolving fund accounts, overestimated maintenance needs, replacement of recoverable munitions, and procurements that were cancelled due to the operations' short duration; (2) foreign contributions to the Defense Cooperation Account should total $48.3 billion, almost $800 million more than the OMB funding requirement estimate, and assuming that countries continue to fulfill their pledges, the $15 billion appropriated to the Persian Gulf Regional Defense Fund will not be needed; (3) tracking incremental costs for the operation was difficult because the services only captured total costs at the unit level and did not subtract the costs they would have normally incurred had there been no crisis in the Persian Gulf; and (4) cost data are aggregated into broad and general categories that make it difficult to verify whether or not specific costs have been properly charged to the operation.

Recommendations

Our recommendations from this work are listed below with a Contact for more information. Status will change from "In process" to "Open," "Closed - implemented," or "Closed - not implemented" based on our follow up work.

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