The Clinton Administration has announced plans to deploy some 4,000 U.S. troops to Kosovo as part of a 28,000-troop NATO peacekeeping operation, if an agreement can be reached between the province’s ethnic Albanian majority and Serb-dominated Yugoslavia. Under the NATO peace plan, Kosovo would be granted autonomy—but not independence—from Serbia, Yugoslavia’s dominant republic. As part of the agreement, the Albanian rebels would disarm their forces, while Serbian military forces would be withdrawn from the province. As an interim measure, NATO forces would be used to police this agreement for three years.

On March 18th, the leaders of Kosovo’s ethnic Albanians agreed to the NATO proposal. But so far, the government of Yugoslavia has refused to accept the plan. NATO officials have warned that, if the Serbs refuse to agree to the peace plan, NATO is prepared to use military force to compel acceptance. This analysis provides a rough estimate of the likely costs of future U.S. military operations in Kosovo. It also summarizes past contingency operation costs and offers a brief discussion of the potential impact of these operations on U.S. military readiness.

How Much Are Operations in Kosovo Likely to Cost?
CSBA estimates that the deployment of 4,000 U.S. troops to Kosovo, if limited to peacekeeping operations similar to those being carried out in Bosnia, would incur incremental cost of about $1 billion a year. Incremental costs consist of the additional costs that would be incurred by the U.S. military—above normal peacetime costs—as a result of conducting these operations. This estimate was derived by essentially extrapolating from U.S. experience in Bosnia over the past three years. It includes not only the incremental costs that would be incurred by the 4,000 U.S. troops stationed in Kosovo, but also those costs associated with U.S. forces stationed elsewhere in the region that would likely be needed to support the operation.

By comparison, the Department of Defense (DoD) has tentatively estimated that operations in Kosovo would incur incremental costs of $1.5 billion to $2 billion a year. On a per troop basis, this is about twice as much as U.S. operations in Bosnia have cost. It is not clear why DoD’s estimate is so much higher, but it could be due to a wide variety of factors. For example, DoD may believe that U.S. forces in Kosovo would have to rely relatively more heavily on support from forces elsewhere in the region than has been the case with troops in Bosnia.

In addition to the cost of Kosovo peacekeeping operations, DoD could also incur substantial costs if it is required to compel Serb acceptance of the peace accord through the use of military force. If NATO air strikes against Yugoslavia were to roughly resemble the four-day Desert Fox operation launched against Iraq in December, it would likely incur incremental costs of at least $500 million. However, estimating the costs of such an operation is even more difficult and uncertain than estimating the costs of peacekeeping operations.

These costs would depend greatly on the duration of the campaign, the size of the forces brought into the region to take part in the effort, the number of aircraft sorties flown, the number of precision-guided munitions (including both sea-launched Tomahawks and air-delivered PGMs) employed, and the effectiveness of Serb air defenses. A prolonged and intense air campaign could cost several billion dollars.

What Kinds of Costs Will Be Incurred?
The following section provides a brief description of the kinds of costs likely to be incurred during U.S. peacekeeping operations in Kosovo. To give a rough idea of how those costs might be allocated in operations in Kosovo, it also provides a very rough estimate of the proportion of DoD’s incremental costs that were absorbed by these various functions during the U.S. military’s first year in Bosnia. Overall, most of the incremental funding required to cover the costs of peacekeeping operations in Kosovo is likely to be absorbed by various operations and maintenance (O&M) activities. In Bosnia, O&M accounted for over 80 percent of those costs, while military personnel costs absorbed most of the rest. As in the case of Bosnia, it is also likely that the Army will incur the bulk of those costs. Indeed, it may well incur more than the 75 percent share it incurred in Bosnia’s first year.

• Pre-Deployment: Before U.S. military forces are sent to Kosovo, some special training may be required. Special equipment for the mission also may need to be purchased. These and other preparation-related costs accounted for about 5 percent of the costs incurred during the first year of the U.S. deployment in Bosnia.

• Deployment: Once U.S. forces are prepared for peacekeeping operations in Kosovo, the troops and their equipment will have to be transported into the region. After that, forces will have to be transported in and out Kosovo as U.S. forces are periodically rotated. Finally, U.S. forces will have to be re-deployed back to their home bases when the mission in Kosovo ends. Transportation expenses accounted for some 10 percent of U.S. incremental costs during the first year in Bosnia.

• Sustainment: After U.S. troops are deployed to Kosovo, they will have to be housed, fed and clothed, and their equipment will need to be maintained and kept in good repair. In Bosnia, civilian contractors have been used to perform many of these logistics and engineering services (e.g., construction of troop housing and other facilities, food service and laundry operations, base camp and equipment maintenance, and freight transportation within the area of operations). During the first year in Bosnia, sustainment efforts accounted for roughly 50 percent of DoD’s costs.

• OPTEMPO: In conducting peacekeeping duties, equipment must generally be operated at a higher operational tempo (OPTEMPO) than during regular peace time training (e.g., aircraft typically log more hours in the air, and tanks and vehicles are used more frequently). This higher OPTEMPO increases DoD’s maintenance and repair costs above normal peacetime levels. Higher OPTEMPO accounted for some 10-20 percent of DoD’s costs during the first year in Bosnia.

• Reserves: If National Guard or Reserve troops are called up to take part in or support the operation in Kosovo, DoD will incur additional pay and pay-related costs. In the first year in Bosnia, reserve personnel costs comprised about 10 percent of DoD’s costs.

• Special Pay: Military personnel serving in Kosovo may be eligible for a variety of special payments related to the deployment. These include hazardous duty pay and family separation allowances. Special pay accounted for roughly 5 percent of DoD’s costs in the first year in Bosnia.

Cost Of U.S. Contingency Operations, FY 1991-1999
(in millions of dollars)

What is the Effect of Contingency Operations on Readiness?
Over the past several years, DoD has become increasingly concerned that U.S. participation in peacekeeping and other contingency operations is reducing the readiness of the U.S. military to carry out more traditional military missions. However, just how serious the effects have been is far from clear.

The stress of contingency operations has contributed to declines in equipment maintenance and repair. It has also interfered with some training activities. Perhaps most importantly, the Services claim that the extended deployments away from home necessitated by these operations has become a major cause of the Services recent problems with recruitment and, especially, retention.

Although the U.S. military’s increased involvement in contingency operations has led to some serious problems, the impact of those operations on military readiness is also sometimes overstated. For example, while Air Force mission-capable rates for major weapon systems have fallen by 10 percent since 1991, the higher OPTEMPO incurred in peacekeeping operations is by no means the only, or perhaps even the major, cause of that decline. The main reasons that recent levels of O&M funding—which on a per-troop basis are very high by historical standards—have proven insufficient to keep some military equipment in good repair, is that an increasing share of DoD’s O&M budget has come to be absorbed by various infrastructure functions (e.g., base operations, headquarters activities, and environmental clean-up).

Thus, efforts to reduce infrastructure costs, by allowing private sector contractors to compete for work currently performed by DoD employees and closing excess military bases, may be more helpful to improving material readiness than reducing involvement in contingency operations. It is also important to note that traditional forward presence missions (e.g., Navy deployments in the Mediterranean Sea and Army deployments in South Korea) also contribute to the U.S. military’s relatively high OPTEMPO. It is also possible that the strain caused by both contingency operations and more traditional forward presence operations could be relieved somewhat through the use of different deployment patterns such as the Air Force’s new Air Expeditionary Force concept or new technologies.

Finally, even the impact of contingency operations on recruitment and retention is ambiguous. According to a recent RAND study,¹ involvement in contingency operations can actually improve retention under some circumstances. The study found that Service members with at least one experience in a “long or hostile” deployment were more likely to re-enlist than those with no experience. However, it also found that there can be too much of a “good thing”: for those who have already experienced such duty, more long—and especially hostile—duty tends to reduce reenlistment.

Taken together, these considerations suggest that deploying U.S. forces to Kosovo for peacekeeping duties could cause some further slip in material readiness and contribute to problems with retention. But if the operation is fully funded by the administration and Congress (i.e., DoD is not required to pay for it by shifting funding from elsewhere within its O&M accounts) the effects on material readiness might be minimal. Moreover, while the impact of such a deployment on retention could be negative—and should be monitored closely—it is also possible that this effect will be relatively modest.See Table

For more information, contact Steven Kosiak or Elizabeth Heeter at 202-331-7990.

The Center for Strategic and Budgetary Assessments (CSBA) is an independent policy research institute established to promote innovative thinking about defense planning and investment strategies for the 21st century. Our web site is at http://www.csbahome.com.

1. James Hosek and Mark Totten, Does Perstempo Hurt Reenlistment? The Effect of Long or Hostile Perstempo on Reenlistment (RAND: Santa Monica, CA) 1998, p. xi.