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Letter from Douglas Holtz-Eakin, Director to Ike Skelton including report: The Potential Costs Resulting from Increased Usage of Military Equipment in Ongoing Operations [i] (March 2005)

handle is hein.congrec/cbo9730 and id is 1 raw text is: CONGRESSIONAL BUDGET OFFICE Douglas Holtz-Eakin, Director U.S. Congress Washington, DC 20515 March 18, 2005 Honorable Ike Skelton Ranking Member Committee on Armed Services U.S. House of Representatives Washington, DC 20515-6035 Dear Congressman: In response to your request, the Congressional Budget Office (CBO) has assessed the types of major equipment under stress from ongoing military operations in Iraq and Afghanistan and estimated the potential costs associated with rectifying problems resulting from excessive wear and tear. CBO estimates costs for 2005 of roughly $8 billion to rectify wear and tear. CBO also notes that operations in 2003 and 2004 caused damage to equipment that had not been corrected by the beginning of 2005. Including that backlog brings the potential total costs of repairing and replacing damaged equipment in 2005 to between $13 billion and $18 billion. The bulk of those costs-roughly 60 per- cent-are attributable to lost and worn-out Army equipment. The Navy's require- ments are the smallest-less than 5 percent of the total costs. The Air Force and Marine Corps account for 20 percent and 15 percent, respectively, of those costs. If either the size of the forces maintained in Iraq and Afghanistan or the pace of operations conducted there decreases appreciably, the costs resulting from worn-out equipment will also decline. The enclosure describes the analysis by CBO's National Security Division. If you would like further details, we would be pleased to provide them. The analysis was prepared by Daniel Frisk, who can be reached at (202) 226-2761, and by Frances Lussier, who can be reached at (202) 226-2906. Sincerely, Douglas Holtz-Eakin Enclosure cc: Honorable Duncan Hunter Chairman www.cbo.gov

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