. Military Space News .
Cost Of AEHF Military Satellites Soars

Unit cost on Advanced Extremely High Frequency Satellites (AEHF) "has increased by more than 50 percent," the GAO said. In 2004 alone "the program experienced cost increases of more than 15 percent."
by Martin Sieff
UPI Senior News Analyst
Washington (UPI) Aug 03, 2005
America's high frontier, its high-tech, cutting-edge defense systems in space may be decades ahead of the rest of the world, but they are also years behind schedule and billions of dollars over budget.

And that is the documented conclusion not of pacifist or liberal critics but of the Bush administration's own Government Accountability Office.

However, the most worrying conclusion to be drawn from the GAO's latest inquiry into the status and short-falls of the U.S. government's military space programs is that there is no single agency, company or simple villain to blame for the problems.

A detailed, program-by-program analysis of the state of seven different programs finds different kinds of problems and delays.

In testimony to the Strategic Forces Subcommittee of the House Committee on Armed Services July 12, Robert E. Levin, the GAO's director of acquisitions and management, listed the highlights of his organization's recent findings on the problems of the programs.

Unit cost on Advanced Extremely High Frequency Satellites (AEHF) "has increased by more than 50 percent," the GAO said. In 2004 alone "the program experienced cost increases of more than 15 percent." The GAO attributed these cost increases "to production problems and changing security requirements. Earlier cost increases were attributed, in part, to a rush to start the program, changing requirements, and a lack of funding to support an overly optimistic schedule."

Unit costs on Evolved Expendable Launch Vehicles have increased by 81 percent," the GAO said. "In 2004, this program experienced cost increases of more than 25 percent,."

"A chief reason for cost increases is a decline in the commercial launch market upon which the company's business case was based, as well as a reduction in anticipated launches." In order to reduce costs, "the two primary contractors -- Boeing Launch Services, Inc. and Lockheed Martin Space Systems Company -- agreed to form a joint venture to combine production, engineering, test and launch operations for U.S. government launches."

Total costs of the Navstar Global Positioning System II, or GPS II "have increased by over 20 percent." The main reason, the GAO said, was the Department fo Defense's "decision to delay the start of the follow-up GPS III program. ... The delay will require DOD to buy additional GPS IIF satellites -- so far at least seven more than the program had planned."

Costs on the National Polar-orbiting Operational Environmental Satellite System, or NPOESS "have increased by roughly 10 percent due to changes to the contract, increased program management costs, and increased funds needed to mitigate risks."

The crucial Space Based Infrared Systems High or SBIRS-High missile warning program "has experienced schedule slips of at least 6 years ... while DOD's total program cost estimate was about $3.9 billion, it is now $9.9 billion -- nearly a 150 percent unit cost increase."

The GAO "attributed past problems to an acquisition approach that decreased oversight of contractors, technology challenges, and software development programs."

Costs for Wideband Gapfiller Satellites (WGS) "have increased since 2000. The launch of the first satellite has been delayed by almost two years." The GAO also noted "that the program encountered design, integration and manufacturing problems, due largely to the fact that the program was not able to leverage expertise from the commercial sector ... because there was less-than-anticipated demand for the commercial satellite."

Even on three new military space-based programs that have not been active long enough to run up any major delays or cost over-runs, the GAO found cause for concern:

The GAO warned earlier this year "that early procurement of long lead items before achieving a stable design" for the U.S. Navy's Mobile User Objective System, or MUOS could lead to cost increases. Also, the program's development schedule remained compressed, posing risks should software development or other technical or design problems be encountered.

And in 2004, the GAO warned in developing its new space radar program, "DOD was not on a path that would enable it to accumulate knowledge and had not formalized agreement on requirements needed to start this technically complex and potentially very costly effort." Following this criticism and new directives from Congress, in January 2005, "DOD restructured this effort, focusing on developing smaller, demonstrator satellites."

Finally, the new Transformational Satellite Communications System, or TSAT entered the formal acquisition phase in 2004 with only one of seven critical technologies mature

The GAO attempted the Herculean task of trying to "identify the common and causal factors for these poor acquisition outcomes."

It concluded: ""that DOD has been unable to match resources (technology, time and money) to requirements before starting individual programs, setting the stage of technical and other problems , which led to cost and schedule increases."

Also, "DOD starts more programs than it can afford, creating a set of incentives and pressures that invariably have negative effects ion individual programs and the larger investment portfolio."

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