Clarification

In the original version of this story, it was reported that, with regard to the proposed move of the U.S. Army Europe headquarters from Heidelberg to Wiesbaden in Germany, the GAO found that the analyses of cost savings had been based on unofficial methods and outdated population data. However, the article failed to mention that the Department of the Army called for a second analysis. According to the GAO report, the “subsequent, more robust cost analysis completed in 2009 reduced the estimated annual cost savings to less than half of the original estimate, but affirmed the decision to consolidate [USAREUR headquarters] in Wiesbaden.”

Poor planning and the use of inconsistent data have plagued the Army’s transformation plans in Europe, and the missteps could cost the Defense Department billions over the next decade, according to a new report by the Government Accountability Office.

The restructuring plan was meant to save taxpayers $80 billion in overseas military spending, but the GAO report states that delays in decision-making regarding the closing of bases in Bamberg and Schweinfurt, Germany, as well as delays in moving U.S Army Europe’s headquarters from Heidelberg to Wiesbaden, will lead to significant cost overruns.

The report comes at a time when Pentagon spending is under scrutiny. Last month, Defense Secretary Robert Gates proposed closing a military command, restricting the use of outside contractors and reducing the number of generals and admirals across the armed forces as part of an effort to curb spending. And earlier this summer, a congressional task force led by Rep. Barney Frank, D.-Mass, called for the elimination of an Air Force fighter wing overseas, one Army brigade combat team in Europe and two reinforced Marine Corps infantry battalions in Okinawa to shave $1 trillion from defense spending over the next 10 years.

In its report, the GAO found that planners who conducted analyses of cost savings from Europe transformation used unofficial methods, and in some cases outdated population data that failed to consider population growth on some installations and the costs of expanding those facilities.

“The original analyses were poorly documented, limited in scope and based on questionable assumptions,” the report published Monday states.

The Army had planned hundreds of millions of dollars in savings by closing the base and facilities around Heidelberg and moving USAREUR’s headquarters to Wiesbaden. But the report said the 2005 savings estimate was inflated by almost double.

The Department of the Army also found fault in cost analysis of the proposed move and called for a second analysis. According to the GAO report, the “subsequent, more robust cost analysis completed in 2009 reduced the estimated annual cost savings to less than half of the original estimate, but affirmed the decision to consolidate [USAREUR headquarters] in Wiesbaden.”

USAREUR spokeswoman Maj. Valerie Henderson declined to comment because the recommendations were directed at the DOD. “But I can tell you that USAREUR’s consolidation efforts are proceeding on track in accordance with DOD and EUCOM basing plans,” she said in an e-mail.

The Defense Department had planned to return the Germany-based 172nd and 170th brigade combat teams to the United States and close the Bamberg and Schweinfurt posts. But in February, the DOD’s Quadrennial Defense Review backed retention of the brigades pending a review of NATO’s Strategic Concept in November and an accompanying assessment of its European defense posture network.

According to the GAO report, the delay in the decision to retain the two brigades will require an additional $176 million in 2013. And officials estimate that the costs of keeping the brigades in Europe could rise to $2 billion over the next decade.

Starting in fiscal 2014, it will cost the DOD an additional $360 million a year to retain the brigades in Europe compared with having them at U.S. bases. The additional expense comes from the cost to provide schools, housing and overseas allowances to soldiers and their families, as well improvements at Bamberg and Schweinfurt, which have not received recent funding because of their scheduled closures.

U.S. Army Europe officials provided the GAO investigators with few documents about the 2005 analysis, and there was limited detail about what criteria, such as cost savings or better force protection, were used in making the decision to move USAREUR’s headquarters.

“Although they noted that cost savings was one of the key reasons for the decision, they also told us that the decision was primarily based on judgment,” wrote John H. Pendleton, director of Defense Capabilities and Management and lead author of the report.

The Army is still planning to close the Heidelberg facilities by 2015, but has not yet obtained all the funding to build the new headquarters complex in Wiesbaden, according to the report. And the Army estimates it will need an additional $150 million per year to continue operations in Heidelberg.

The GAO report recommended a comprehensive analysis of alternatives for stationing forces in Europe. The analysis should be completed by January.

robbinss@estripes.osd.mil