Military expects to exhaust operating funds by June, official says

January 05, 1991|By Richard H. P. Sia | Richard H. P. Sia,Washington Bureau of The Sun

WASHINGTON -- Even if war can be avoided, the Persian Gulf crisis will force most U.S. military services to deplete their funds for spare parts, fuel, food and other operating expenses by June, the head of the General Accounting Office said yesterday.

This will require Congress to give the Pentagon much more than expected in supplemental appropriations later this year, all of which "will add directly to the deficit, just like the cost of the savings and loan bailout," said Charles A. Bowsher, the U.S. comptroller general, who heads the auditing agency.

Mr. Bowsher, appearing yesterday before the House Budget Committee, also predicted that prolonged U.S. military operations in the region would upset congressional and Bush administration plans to cut defense spending over the next three years.

Regardless of how much foreign contributions might defray U.S. expenses, the Pentagon is certain to seek more money for Operation Desert Shield, he said.

"The peace dividend we were looking for is basically going to be spent in the next year or two," Mr. Bowsher said.

The Pentagon has already received $2 billion in extra funds from Congress to cover the costs of gulf operations from August to Oct. 1, when the current fiscal year began. Pentagon officials said last week that they still hope to offset additional costs with more contributions from U.S. allies and modest budget transfers from other defense accounts.

Defense Secretary Dick Cheney is planning to ask Congress for supplemental funding early next month, probably when the administration sends its annual budget to Capitol Hill, Pentagon spokesman Pete Williams said. Official cost estimates will be released at that time, he said.

Mr. Bowsher urged the House panel to provide supplemental funds throughout the year as the actual costs of Operation Desert Shield become clearer.

"Because of numerous uncertainties in the cost estimates, we believe it would be inappropriate to provide a lump-sum payment now," he said.

He said that Marine Corps funds for operations and maintenance are being obligated so rapidly that the entire 1991 appropriation -- $1.9 billion -- will dry up by mid-April. The service projected spending half of its so-called O&M account by the end of last month, he said.

The O&M account, part of each military service's total annual budget, pays for training, spare parts and supplies, the maintenance of military facilities and salaries of civilian workers.

"Army officials told us that they expect to obligate their entire fiscal year 1991 O&M appropriation of $21.5 billion by sometime in April or May," Mr. Bowsher said. He said the Air Force's account should be depleted in June.

The Navy, which budgets enough to keep ships at sea for 45 days every three months, does not expect to use up its operating funds until July at the earliest, he said.

Mr. Bowsher endorsed recent unofficial estimates that the gulf crisis would force the Defense Department to spend an extra $30 billion this fiscal year, noting that some Pentagon officials told the GAO that the figure is "in the ballpark" of their current projections.

"The cost estimates will go up very, very rapidly if we go into full-fledged conflict," he said.

Lawrence Korb, a former assistant secretary of defense for manpower, told the panel later that a war against Iraq could cost the Pentagon up to $2 billion a day.

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