The State Department estimates that it would cost $40 million annually and require 1,300 permanent observers to ensure compliance with any Central American peace treaty, according to a recent analysis.
Such an arrangement, which the department said would cost $9.2 million to establish, is expected to be proposed by U.S. allies in the region during the next three weeks as part of the final Contadora pact negotiations. Negotiators hope to finish by June 6.
Senate Foreign Relations Committee Chairman Richard G. Lugar (R-Ind.), who returned from Central America on Friday, said at a news conference that special envoy Philip C. Habib, in meetings with the presidents of El Salvador, Honduras, Guatemala and Costa Rica, had "succeeded in getting . . . a real recognition of what is needed" in a treaty.
Lugar said the United States would support any treaty that contains adequate verification and enforcement procedures and that pushes Nicaragua toward democracy.
The Contadora talks, named for the island where Colombia, Panama, Venezuela and Mexico launched the effort, have been stalled for months as Nicaragua and the United States have exchanged blame for the delay.
Nicaragua agreed to sign a September 1984 version of the treaty, which others, at the urging of the United States, condemned as lacking an adequate verification system.
Subsequent negotiations produced tentative agreement on verification in a September 1985 Contadora draft, but the State Department's staff analysis found that proposal "virtually silent on the crucial details of staffing, powers, resources and access."
Manuel Cordero, the Nicaraguan Embassy political officer, expressed surprise that verification remains an issue. "We thought that was mostly settled," he said. "This is a new emphasis."
Nicaragua has pledged to sign the latest draft if the United States agrees to halt its aid to the rebels -- known as contras or counterrevolutionaries -- attacking Nicaragua's leftist Sandinista government. Habib has pledged that U.S. military aid to the contras will cease if Nicaragua signs the final Contadora treaty and abides by it thereafter.
"The Sandinistas should want good verification to make sure the contras don't get any U.S. help, and we want it to make sure they the Sandinistas open up internally and stop sending arms" to rebels in El Salvador, a State Department official said. "If everybody's serious, we could have a deal."
The four-page State Department paper, "Essential Elements of Effective Verification," calls for a jungle version of the Sinai Multilateral Force and Observers (MFO) system, which monitors compliance with the 1979 peace treaty under which Israel returned the Sinai Peninsula to Egypt.
That system, which went into effect in April 1982, involves 3,000 people -- including 2,600 soldiers -- from 11 nations, and costs $90 million a year, paid equally by the United States, Egypt and Israel. Robert E. Krantz, the State Department officer in charge of the U.S. liaison office, said the MFO's task is solely to monitor troop and arms levels and that it had never found any "sinister" violations.
"The thing that makes the MFO so successful is that both parties are intent that it is going to work," Krantz said. "If there were going to be a massive violation, the monitors would just get out of there."
The Contadora treaty, by contrast, involves five nations and a much broader list of agreements. It would halt weapons purchases and lower arms levels, require the departure of foreign troops and advisers, ban foreign bases, prohibit support for cross-border insurrections and set up procedures for internal democratization.
The projected $9.2 million startup cost includes $8 million for vehicles, and the annual $40 million tab includes $15 million for "helicopter contracts." Given the complexity of the treaty and the mountainous jungle terrain, those estimates are conservative, the State Department official said.
The "most important structural element" of verification is to keep separate the investigating process from the process of resolving disputes and levying punishment, the paper said. The current treaty draft merges these functions in one body.
The analysis said that investigators need staff, financing, logistical support and guaranteed access throughout the region, with no political body above them.
The analysis estimates that, like the Sinai process, the Central American system should have a headquarters staff of roughly 25 civilians in each national capital. They would oversee a team of about 25 people, who would "conduct periodic random surveys as well as be on alert to make rapid inspections of questionable activities in the country," according to the paper.
The analysis also calls for "sector command posts" in each nation as well as military personnel "at sites requiring full-time or near full-time surveillance (e.g., ports, airports, major border crossings, and major ground, air and naval facilities)."
In all, the system would require about 270 people for each of the five nations.