In its report, “NASA: Long-Term Commitment to and Investment in Space Exploration Program Requires More Knowledge,” the GAO says NASA’s acquisition strategy for the CEV program needs to be overhauled and it urges the U.S. space agency to hold off on signing a long-term contract for the proposed space shuttle replacement until 2008, the year NASA officials expect to commit to a preliminary design for the CEV and have a better idea of what it will cost to build.
NASA, however, says it will be ready by September to conclude a deal for the design, development and eventual production of the CEV and fully intends to do so.
“We do not concur with GAO’s recommendation that the NASA administrator modify the CEV acquisition strategy,” NASA spokesman Michael Braukus said July 27. “The agency’s business approach is consistent with the GAO’s recommendation and NASA is confident that its acquisition strategy and plans for selecting a CEV prime contractor are based on a sound business case and are in the government’s best interest.”
Bethesda, Md.-based Lockheed Martin is competing against the combined team of Northrop Grumman-Boeing for a CEV prime contract expected to be worth billions of dollars. Both of those teams have been under contract since last summer doing CEV concept development work for NASA. Braukus said NASA is on track to pick a CEV contractor and award the contract as soon as Aug. 31.
NASA originally intended to keep two teams competing for the CEV prime contract through 2008 and make a final selection based on the results of a prototype flyoff. NASA Administrator Mike Griffin, after taking office last year, scrapped the flyoff idea as unaffordable, and moved up the CEV prime contractor selection well ahead of a preliminary design review currently slated for March 2008.
The preliminary design review is a major program milestone intended to provide NASA its first refined cost estimate before the detailed design work begins. Keeping two teams under contract through the preliminary design review, NASA estimates, would cost the agency an additional $2 billion.
Government Accountability Office auditors worry that NASA is asking for trouble by entering into a contract that would run at least through 2014 ‑‑‑ and possibly through 2019 ‑‑‑ before developing “key elements of a sound business case, including well-defined requirements, a preliminary design, mature technology, and firm cost estimates.”
“NASA’s current acquisition strategy for the CEV places the project at risk of significant cost overruns, schedule delays, and performance shortfalls because it commits the government to a long-term product development effort before establishing a sound business case,” the Government Accountability Office wrote in a 22-page report released July 26.
Noting that NASA intends to award a full CEV contract in September despite these warnings, the report urges Congress to “consider restricting annual appropriations and limiting NASA’s obligations for the CEV project to only the amount of funding necessary to support activities needed to successfully complete the project’s preliminary design review.”
The GAO report was requested by House Science Committee Chairman Sherwood Boehlert (R-N.Y.) and his Democratic counterpart Rep. Bart Gordon (Tenn.).
“GAO has provided an important early-warning signal that all may not be well with NASA’s approach to implementing the exploration initiative,” Gordon said in a statement. “I think Congress needs to take a serious look at the issues GAO raises. We have seen too many examples in recent years of government programs that deviated significantly from their original cost, schedule, and performance goals to ignore GAO’s concerns.”
Boehlert said in a statement issued July 26 that he shared the GAO’s concerns “about the need to obtain full information before entering into long-term commitments” and plans to hold a hearing this autumn on the issues raised in the report. However, Boehlert gave no indication he intended to stand in the way of NASA making a CEV contract award this summer, noting in the statement that he is “eager to see NASA continue planning and designing the CEV.”
In addition to challenging NASA’s CEV acquisition plans, the report also questions whether NASA can really afford to return to the Moon by 2020 via the path it laid out last year.