United States Government Accountability Office

GAO Report to Subcommittee on Strategic 

Forces, Committee on Armed Services, 

House of Representatives 

SPACE 

ACQUISITIONS 

DOD Needs to Take 

More Action to 

Address Unrealistic 

Initial Cost Estimates 

of Space Systems 

November 2006 

 

GAO-07-96 
What GAO Found

United States Government Accountability Office

Why GAO Did This Study

Highlights

Accountability Integrity Reliability

November 2006

SPACE ACQUISITIONS

DOD Needs to Take More Action to 

Address Unrealistic Initial Cost Estimates 

of Space Systems 

Highlights of GAO-07-96, a report to 

Subcommittee on Strategic Forces, 

Committee on Armed Services, House of 

Representatives 

Estimated costs for the Department 

of Defense’s (DOD) major space 

acquisition programs have 

increased by about $12.2 billion 

from initial estimates for fiscal 

years 2006 through 2011. Cost 

growth for ongoing Air Force 

programs above initial estimates 

accounts for a substantial portion

of this 44 percent increase. In light 

of the role that optimistic

estimating is believed to have

played in exacerbating space

acquisition cost growth, you 

requested that we examine 

(1) in what areas space system

acquisition cost estimates have

been unrealistic and (2) what 

incentives and pressures have 

contributed to the quality and 

usefulness of cost estimates for 

space system acquisitions. 

What GAO Recommends

GAO recommends that DOD take a

number of actions to increase the 

likelihood that independent, more

realistic cost estimates will be 

developed and utilized. 

DOD concurred with the overall 

findings of this report and provided

information on the specific actions 

it was already taking to improve

the Air Force’s cost-estimating 

capability.

Costs for DOD space acquisitions over the past several decades have

consistently been underestimated—sometimes by billions of dollars. For 

example, Space Based Infrared System High program costs were originally

estimated at $4 billion, but the program is now estimated to cost over $10 

billion. Estimated costs for the National Polar-orbiting Operational Satellite 

System program have grown from almost $6 billion at program start to over 

$11 billion. 

For the most part, cost growth has not been caused by poor cost estimating, 

but rather the tendency to start programs before knowing whether 

requirements can be achieved within available resources—largely because of 

pressures to secure funding. At the same time, however, unrealistic program 

office cost estimates have exacerbated space acquisition problems. 

Specifically, with budgets originally set at unrealistic amounts, DOD has had 

to resort to continually shifting funds to and from programs, and such shifts 

have had costly, reverberating effects. 

Our analyses of six ongoing space programs found that original cost 

estimates were particularly unrealistic about the promise of savings from 

increased contractor program management responsibilities, the constancy 

and availability of the industrial base, savings that could be accrued from 

heritage systems, the amount of weight growth that would occur during a 

program, the availability of mature technology, the stability of funding, the 

stability of requirements, and the achievability of planned schedules. At 

times, estimates that were more realistic in these areas were available to the 

Air Force, but they were not used. 

Cost-estimating and program officials we spoke with identified a number of 

factors that have contributed to this condition, in addition to larger 

pressures to produce low estimates that are more likely to win support for 

funding. 

• Although the National Security Space Acquisition policy requires that 

independent cost estimates be prepared by bodies outside the 

acquisition chain of command, it does not require that they be relied 

upon to develop program budgets. 

• While the policy requires that cost estimates be updated at major 

acquisition milestones, significant events, such as changes in the 

industrial base or funding, have occurred between milestones. 

• Within space system acquisitions, cost-estimating officials believe that 

their roles and responsibilities are not clear and the cost-estimating 

function is fragmented. 

• Cost-estimating resources have atrophied over the years because of 

previous downsizing of the workforce, making resources such as staff 

and data inadequate and the Air Force more dependent on support 

contractors for the estimating function. 

www.gao.gov/cgi-bin/getrpt?GAO-07-96.

To view the full product, including the scope 

and methodology, click on the link above. 

For more information, contact Cristina T. 

Chaplain at (202) 512-4841 or 

chaplainc@gao.gov. 
Contents 

Letter 1

Results in Brief 2

Background 3

Program Office Cost Estimates on Space Programs Not Realistic 7 

Various Incentives and Pressures within DOD Have Contributed to 

Cost- Estimating Weaknesses 13 

Successful Organization Approaches That Better Support Cost 

Estimating 22

Conclusions 25

Recommendations for Executive Action 26 

Agency Comments and Our Evaluation 27 

Appendix I Scope and Methodology 29 

Appendix II DOD Acquisition Categories for Major Defense 

Acquisition Programs 31 

Appendix III Examples of Where Program Officials Were Too 

Optimistic in Their Assumptions 32 

Appendix IV Examples Where Independent Cost Estimates 

Were Not Relied Upon 37 

Appendix V Comments from the Department of Defense 45 

Appendix VI GAO Contacts and Staff Acknowledgments 49 

Related GAO Products 50 

Page i GAO-07-96 Space Acquisitions
Tables 

Table 1: Areas Where Program Officials Were Too Optimistic in 

Their Assumptions 8 

Table 2: Comparison of 2004 AEHF Program Office and

Independent Cost Estimates 15 

Table 3: Comparison of 2003 NPOESS Program Office and 

Independent Cost Estimates 16 

Table 4: Comparison of 1996 SBIRS High Program Office Cost 

Estimate and Independent Cost Estimate 16 

Table 5: DOD Acquisition Categories and Decision Authorities 31 

Table 6: Examples of Optimistic Assumptions 32 

Table 7: Comparison of 2004 AEHF Program Office and

Independent Cost Estimates 37 

Table 8: Historical AEHF Weight Growth 38 

Table 9: Comparison of 2003 NPOESS Program Office and 

Independent Cost Estimates 40 

Table 10: Program Office Integration Estimates for NPOESS 41 

Table 11: SBIRS High GEO 3–5 Procurement Funding Analysis 43 

Figure 

Figure 1: Key Events and Funding Shifts That Occurred between 

Estimates for SBIRS High 18 

Page ii GAO-07-96 Space Acquisitions
Abbreviations 

ACAT Acquisition Category 

AEHF Advanced Extremely High Frequency

AFCAA Air Force Cost Analysis Agency 

APB Acquisition Program Baseline 

CAIG Cost Analysis Improvement Group 

DOD Department of Defense 

DMSP Defense Meteorological Satellite Program 

EELV Evolved Expendable Launch Vehicle 

GEO geosynchronous earth orbit 

GPS Global Positioning System 

HEO highly elliptical orbit 

KDP key decision point 

NPOESS National Polar-orbiting Operational Environmental 

 Satellite System 

NRO National Reconnaissance Office 

NSA National Security Agency 

SBIRS Space Based Infrared System 

SMC Space and Missile Systems Center 

TRL Technology Readiness Level 

TSAT Transformational Satellite Communications System 

TSPR Total System Performance Responsibility 

WGS Wideband Gapfiller Satellites 

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Page iii GAO-07-96 Space Acquisitions
United States Government Accountability Office

Washington, DC 20548 

November 17, 2006 

The Honorable Terry Everett 

Chairman 

The Honorable Silvestre Reyes 

Ranking Minority Member 

Subcommittee on Strategic Forces 

Committee on Armed Services 

House of Representatives 

The Honorable Terry Everett 

Chairman 

The Honorable Silvestre Reyes 

Ranking Minority Member 

Subcommittee on Strategic Forces 

Committee on Armed Services 

House of Representatives 

Estimated costs for the Department of Defense’s (DOD) major space 

acquisition programs have increased a total of about $12.2 billion—or 

nearly 44-percent—above initial estimates for fiscal years 2006 through 

2011. In some cases, current estimates of costs are more than double the 

original estimates. For example, the Space Based Infrared System (SBIRS) 

High program was originally estimated to cost about $4 billion, but is now 

estimated to cost over $10 billion. The National Polar-orbiting Operational

Satellite System (NPOESS) program was originally estimated to cost 

almost $6 billion but is now over $11 billion. Such growth has had a 

dramatic impact on DOD’s overall space portfolio. To cover the added

costs of poorly performing programs, DOD has shifted scarce resources 

away from other programs, creating a cascade of cost and schedule 

inefficiencies. 

Estimated costs for the Department of Defense’s (DOD) major space 

acquisition programs have increased a total of about $12.2 billion—or 

nearly 44-percent—above initial estimates for fiscal years 2006 through 

2011. In some cases, current estimates of costs are more than double the 

original estimates. For example, the Space Based Infrared System (SBIRS) 

High program was originally estimated to cost about $4 billion, but is now 

estimated to cost over $10 billion. The National Polar-orbiting Operational

Satellite System (NPOESS) program was originally estimated to cost 

almost $6 billion but is now over $11 billion. Such growth has had a 

dramatic impact on DOD’s overall space portfolio. To cover the added

costs of poorly performing programs, DOD has shifted scarce resources 

away from other programs, creating a cascade of cost and schedule 

inefficiencies. 

Our work has identified a variety of reasons for this cost growth, most 

notably that weapons programs are incentivized to produce and use 

optimistic cost and schedule estimates in order to successfully compete 

for funding and that DOD starts its space programs too early, that is, 

before it has assurance that the capabilities it is pursuing can be achieved 

within available resources and time constraints. At the same time, 

however, this cost growth was partly due to the fact that DOD used low 

cost estimates to establish programs’ budgets and later found it was 

necessary to make funding shifts that had costly, reverberating effects. In

2003, a DOD study of space acquisition problems found that the space 

acquisition system is strongly biased to produce unrealistically low cost 

estimates throughout the process. The study found that most programs at 

the time of contract initiation had a predictable cost growth of 50 to 

100 percent. The study also found that the unrealistically low projections 

of program cost and lack of provisions for management reserve seriously 

distorted management decisions and program content, increased risks to 

Our work has identified a variety of reasons for this cost growth, most 

notably that weapons programs are incentivized to produce and use 

optimistic cost and schedule estimates in order to successfully compete 

for funding and that DOD starts its space programs too early, that is, 

before it has assurance that the capabilities it is pursuing can be achieved 

within available resources and time constraints. At the same time, 

however, this cost growth was partly due to the fact that DOD used low 

cost estimates to establish programs’ budgets and later found it was 

necessary to make funding shifts that had costly, reverberating effects. In

2003, a DOD study of space acquisition problems found that the space 

acquisition system is strongly biased to produce unrealistically low cost 

estimates throughout the process. The study found that most programs at 

the time of contract initiation had a predictable cost growth of 50 to 

100 percent. The study also found that the unrealistically low projections 

of program cost and lack of provisions for management reserve seriously 

distorted management decisions and program content, increased risks to 

Page 1 GAO-07-96 Space Acquisitions
mission success, and virtually guaranteed program delays. We have found 

that most of these conditions exist in many DOD programs. 

Given concerns about the role optimistic cost estimating has played in

exacerbating space acquisition problems, you requested that we examine 

(1) in what areas space system acquisitions cost estimates have been 

unrealistic and (2) what incentives and pressures have contributed to the

quality and usefulness of cost estimates for space system acquisitions. 

In conducting our work, we developed case studies of six ongoing major 

space acquisition programs that included analysis of cost and other 

program documentation. These include the Advanced Extremely High 

Frequency (AEHF) satellite program (communications satellites), the 

Evolved Expendable Launch Vehicle (EELV) (satellite launch systems),

the Global Positioning System (GPS) IIF (navigational satellites), the 

National Polar-orbiting Operational Environmental Satellite System 

(weather and environmental monitoring satellites), the Space Based 

Infrared System High (missile detection satellites), and the Wideband 

Gapfiller Satellites (WGS) (communication satellites). We also spoke with 

officials from DOD, the Air Force, and contractor offices and analyzed

DOD and Air Force acquisition and cost-estimating policies. In addition, 

we obtained input on our findings from a panel of cost-estimating experts 

who work within the Office of the Secretary of Defense as well as the Air 

Force. Additional information on our scope and methodology is in 

appendix I. We conducted our work from August 2005 to October 2006 in

accordance with generally accepted government auditing standards. 

Our analyses of six ongoing space programs found that original cost 

estimates were unrealistic in a number of areas, specifically, savings from 

increased contractor program management responsibilities, the constancy 

and availability of the industrial base, savings that could be accrued from 

heritage systems, the amount of weight growth that would occur during a 

program, the availability of mature technology, the stability of funding, the 

stability of requirements, and the achievability of planned schedules. At 

times, estimates that were more realistic in these areas were available to 

the Air Force, but they were not used so that programs could sustain 

support amid competition for funding. 

Results in Brief 

Cost-estimating and program officials we spoke with identified a number 

of factors that have contributed to low estimates in addition to the larger 

pressures to win support for funding. For example, although the National 

Security Space Acquisition policy requires independent cost estimates that 

Page 2 GAO-07-96 Space Acquisitions
are prepared by bodies outside the acquisition chain of command, such 

estimates have not always been relied upon for program decisions or to 

develop program budgets. In addition, while the policy requires that 

independent cost estimates be prepared or updated at major acquisition 

milestones, significant events, such as changes in the industrial base or 

funding, have occurred between milestones. Moreover, within space 

system acquisitions, cost-estimating officials believe that their roles and 

responsibilities are not clear, and the cost-estimating function is 

fragmented. Finally, according to Air Force officials, cost-estimating 

resources have atrophied over the years because of the previous 

downsizing of the workforce, making resources such as staff and data

inadequate and the Air Force more dependent on support contractors for 

the estimating function. 

While the Air Force has taken steps recently to emphasize the use of 

independent cost estimates, it has not made additional changes needed to 

enhance the quality of cost estimates. We are making recommendations 

aimed at instituting these actions. DOD agreed with most of our 

recommendations, and is taking a number of actions to improve the Air 

Force’s cost-estimating capability for space programs. DOD expressed 

concern that requiring officials involved in milestone decisions to 

document and justify their choice of cost estimates would reduce the 

milestone decision authority’s future decision-making flexibility. While we

recognize the importance of decision-making flexibility, we believe that 

more transparency in DOD’s decision making is needed given the poor 

foundation of choices made in the past on space programs. 

Estimates of the total cost of a program are critical components in the 

acquisition process because they help decision makers decide among 

competing options and evaluate resource requirements at key decision 

points. All military services prepare life-cycle cost estimates in support of 

their acquisition programs that attempt to identify all costs of an 

acquisition program, from initiation through development, production, and 

disposal of the resulting system at the end of its useful life. These 

estimates serve two primary purposes. First, they are used at acquisition 

program milestone and decision reviews to assess whether the acquisition 

is affordable or consistent with the military services’ and DOD’s overall 

long-range funding, investment, and force structure plans. Second, they 

form the basis for budget requests to Congress. A realistic estimate of 

projected costs makes for effective resource allocation, and it increases 

the probability of a project’s success. 

Background 

Page 3 GAO-07-96 Space Acquisitions
The requirements and guidance for cost estimating are specified in statute 

and in DOD policies. By law, there is a requirement that an independent 

life-cycle cost estimate be considered by the milestone decision authority 

before approving system development and demonstration, or production 

and deployment, of a major defense acquisition program.1

 The statute 

requires DOD to prescribe regulations governing the content and 

submission of such estimates and that the estimate be prepared by (1) an 

office or other entity that is not under the supervision, direction, or 

control of the military department, DOD agency, or other DOD component 

directly responsible for carrying out the development or acquisition of the 

program, or (2) by an office or other entity that is not directly responsible 

for carrying out the development or acquisition of the program if the 

decision authority for the program has been delegated to an official of a

military department, DOD agency, or other DOD component.2

 The statute 

specifies that the independent estimate is to include all costs of 

development, procurement, military construction, and operations and 

support, without regard to funding source or management control.3

 DOD

policy assigns specific responsibility for fulfilling the requirement of an 

independent cost estimate to the Office of the Secretary of Defense Cost 

Analysis Improvement Group (CAIG) for any major defense acquisition 

program and major system that are subject to review by the Defense 

Acquisition Board of the Defense Space Acquisition Board.4

 These board 

reviews address major defense acquisition programs (including space 

programs) that are designated as acquisition category (ACAT) ID, premajor defense acquisition programs, or ACAT IC programs (see app. II for 

a description of acquisition categories ID and IC). The CAIG independent

cost estimate is prepared for milestone (known as key decision point in 

space programs) B (program start, or preliminary design for space 

programs), and C (low-rate initial production or build approval for space 

programs). In addition, the milestone decision authority may request the 

CAIG to prepare other independent cost estimates, or conduct other ad 

hoc cost assessments for programs subject to its review and oversight. The 

CAIG serves as the principal advisory body to the milestone decision 

authority on all matters concerning an acquisition program’s life-cycle 

 1

 10 U.S.C. § 2434 (2000). 

2

 10 U.S.C. § 2434(b)(1)(A). 

3

 10 U.S.C. § 2434(b)(1)(B). 

4

 DOD Directive 5000.04, Cost Analysis Improvement Group at ¶ 2 (Aug. 2006); DOD

Instruction 5000.2, Enclosure 6, Resource Estimation (May 2003). 

Page 4 GAO-07-96 Space Acquisitions
cost, and is given general responsibilities for establishing DOD policy 

guidance on a number of matters relating to cost estimating. 

Since 2003, cost estimating for major space system acquisitions has been 

governed by the National Security Space Acquisition Policy.5

 Under this 

policy, the CAIG is responsible for and leads the development of 

independent cost analyses of major space acquisition programs.6

 Fulfilling 

the requirement that an independent cost estimate be developed by an 

organization independent of the program office and the acquisition chain 

of command, the CAIG does so in support of a distinct Defense Space 

Acquisition Board, with the Under Secretary of the Air Force as the 

milestone decision authority.7

 The CAIG is to prepare independent cost 

analyses for space acquisition programs by augmenting its own staff with 

an independent team of qualified personnel from across the space 

community, including the Air Force Cost Analysis Agency (AFCAA) and 

the cost estimating organizations of the Air Force Space Command and the 

Air Force Space and Missile Systems Center. In addition to the 

independent cost estimates, individual program offices also prepare cost 

estimates for their acquisition programs. The independent CAIG cost 

estimate is designed to assess the program office estimate and ensure 

realistic cost estimates are considered. In addition, although not required

in the space acquisition policy, in some cases a cost analysis is prepared 

by an Air Force service organization, such as the Air Force Cost Analysis 

Agency. 

Past GAO Findings on 

Space Cost Growth 

For fiscal years 2006 through 2011, estimated costs for DOD’s major space 

acquisition programs have increased a total of about $12.2 billion above 

initial estimates. For example, the cost estimate for the SBIRS High 

program rose from about $4 billion at the start of development in October 

1996 to over $10 billion in September 2005, and costs are expected to rise

further. In addition, the cost estimate for the NPOESS program grew from

 5

 National Security Space Acquisition Policy 03-01 (revised December 2004). 

6

 National Security Space Acquisition Policy at Appendix 3.2. 

7

 Recently, the Under Secretary of Defense for Acquisition, Technology and Logistics 

withdrew its delegation of milestone decision authority from the Air Force. As a result,

although some acquisition authority was returned to the Air Force, the Under Secretary of 

Defense for Acquisition, Technology and Logistics is the current milestone decision 

authority for major space system acquisitions. It is not known when or if this role will be 

placed back within the Air Force. 

Page 5 GAO-07-96 Space Acquisitions
about $5.9 billion at program start in 2002 to nearly $11.4 billion currently, 

according to the CAIG’s latest estimate. 

Our past work has identified a number of causes behind the cost growth 

and related problems, but several consistently stand out. First, on a broad

scale, DOD starts more weapon programs than it can afford, creating a 

competition for funding that encourages low cost estimating, optimistic 

scheduling, overpromising, suppressing of bad news, and, for space 

programs, forsaking the opportunity to identify and assess potentially 

better alternatives. Programs focus on advocacy at the expense of realism 

and sound management. Invariably, with too many programs in its 

portfolio, DOD is forced to continually shift funds to and from programs—

particularly as programs experience problems that require more time and

money to address. Such shifts, in turn, have had costly, reverberating 

effects. 

Second, as we have previously testified and reported, DOD starts its space 

programs too early, that is, before it has the assurance that the capabilities 

it is pursuing can be achieved within available resources and time 

constraints. This tendency is caused largely by the funding process, since 

acquisition programs attract more dollars than efforts concentrating solely 

on proving technologies. Nevertheless, when DOD chooses to extend 

technology invention into acquisition, programs experience technical 

problems that require large amounts of time and money to fix. Moreover, 

when this approach is followed, cost estimators are not well positioned to 

develop accurate cost estimates because there are too many unknowns. 

Put more simply, there is no way to estimate how long it would take to 

design, develop, and build a satellite system when critical technologies 

planned for that system are still in relatively early stages of discovery and

invention. 

A companion problem for space systems is that programs have historically 

attempted to satisfy all requirements in a single step, regardless of the 

design challenge or the maturity of the technologies necessary to achieve 

the full capability. Increasingly, DOD has preferred to make fewer, but 

heavier, large and complex satellites that perform a multitude of missions 

rather than larger constellations of smaller, less complex satellites that 

gradually increase in sophistication. This has stretched technology 

challenges beyond current capabilities in some cases and vastly increased 

the complexities related to software—a problem that affected SBIRS High 

and AEHF, for example.

Page 6 GAO-07-96 Space Acquisitions
In addition, several of the space programs included in our case studies, 

began in the late 1990s, when DOD structured contracts in a way that 

reduced oversight and shifted key decision-making responsibility onto 

contractors. This approach—known as Total System Performance 

Responsibility, or TSPR—was intended to facilitate acquisition reform and 

enable DOD to streamline a cumbersome acquisition process and leverage 

innovation and management expertise from the private sector. However, 

DOD later found that this approach magnified problems related to 

requirements creep and poor contractor performance. In addition, under 

TSPR, the government decided not to obtain certain cost data, a decision 

that resulted in the government having even less oversight of the programs 

and limited information from which to manage the programs. Further, the 

reduction in government oversight and involvement led to major 

reductions in various government capabilities, including cost-estimating 

and systems-engineering staff. The loss of cost-estimating and systemsengineering staff in turn led to a lack of technical data needed to develop

sound cost estimates. 

Our reviews have identified additional factors that have contributed to 

space cost growth, though less directly. These include consolidations 

within the defense supplier base for space programs, the diverse array of

officials and organizations involved with space programs, short tenures for 

top leadership and program managers, as well as capacity shortfalls that 

have constrained DOD’s ability to optimize and oversee its space 

programs. A section at the end of this report lists prior relevant GAO 

reports. 

Our case study analyses found that program office cost estimates—and 

more specifically, the assumptions upon which those estimates were 

based—have been unrealistic in eight areas, many of which are 

interrelated. In some cases, such as assumptions regarding weight growth 

and the ability to gain leverage from heritage, or legacy, systems, past 

experiences or contrary data were ignored. In other cases, such as when 

contractors were given more program management responsibility, as with 

TSPR, or when growth in the commercial market was predicted, 

estimators assumed that promises of reduced cost and schedule would be 

borne out and did not have the benefit of experience to factor into their 

work. We also identified flawed assumptions that reflected deeper flaws in 

acquisition strategies or development approaches. For example, five of six 

programs we reviewed assumed technology would be sufficiently mature 

when needed, even though the programs began without a complete 

understanding of how long it would take or how much it would cost to 

Program Office Cost 

Estimates on Space 

Programs Not 

Realistic 

Page 7 GAO-07-96 Space Acquisitions
ensure technologies could work as intended. In four programs, estimators 

assumed there would be few delays, even though programs were adopting 

highly aggressive schedules while simultaneously attempting to make 

ambitious leaps in capability. In four programs, estimators assumed 

funding would stay constant, even though space and weapon programs 

frequently experience funding shifts and the Air Force was in the midst of 

starting a number of costly new space programs to replenish older 

constellations. 

Table 1 highlights major areas where program officials were too optimistic 

in their assumptions for the six space system acquisitions we examined or 

where additional evidence showed the estimate was unrealistic. In some 

cases, programs may have experienced problems related to one of the 

categories, but we did not have evidence to show the original assumptions 

were optimistic. 

Table 1: Areas Where Program Officials Were Too Optimistic in Their Assumptions 

Space programs affected

Optimistic assumptions AEHF EELV GPS IIF NPOESS SBIRS High WGS

Industrial base would remain constant and available X X X X X 

Technology would be mature enough when needed X X X X X 

TSPR would reduce costs and schedule X X X X 

Savings would occur from experience on heritage systems X X X X 

No weight growth would occur X X X X 

Funding stream would be stable X X X X 

An aggressive schedule X X X X 

No growth in requirements X X X 

Source: This table is based on conversations with program and contracting officials and analysis of data they provided. In some cases, 

we made our own designations based on our prior findings. 

• Assumptions about the space industrial base: Five programs 

experienced challenges due to assumptions that were made about the 

availability and constancy of the industrial base. When cost estimates 

for some of these programs were developed, cost estimators assumed 

the programs would gain leverage from the commercial satellite 

market, which, at the time the programs were initiated, was widely 

expected to continue to grow. In the EELV program, for instance, the 

original contracting concept was for the Air Force to piggyback on the 

anticipated launch demand of the commercial sector. Furthermore, the 

Air Force assumed that it would benefit financially from competition 

among commercial vendors. However, the commercial demand never 

Page 8 GAO-07-96 Space Acquisitions
materialized, and the government was forced to bear the cost burden of 

maintaining the industrial base in order to maintain launch capability, 

and assumed savings from competition were never realized. In other 

cases, programs experienced unanticipated problems resulting from 

consolidations in the supplier base. For example, contractors took 

cost-cutting measures that reduced the quality of parts. Contractors 

also lost key technical personnel as they consolidated development and 

manufacturing facilities. 

• Assumptions about technology maturity: In five of the six space 

system acquisition programs, when cost estimates were developed, 

program officials and cost estimators assumed that technologies 

critical to the programs would be mature and available—even though 

the programs began without a complete understanding of how long or 

how much it would cost to ensure technologies could work as 

intended. Invariably, after the programs began and as their 

development continued, the technology issues ended up being more 

complex than initially believed. For example, on the NPOESS program, 

DOD and the Department of Commerce committed funds for the 

development and production of satellites before the technology was 

mature—only 1 of 14 critical technologies was mature at program 

initiation and 1 technology was determined to be less mature after the 

contractor conducted more verification testing. The program has since 

been beset by significant cost increases and schedule delays due in part 

to technical problems, such as the development of key sensors. On the 

GPS IIF program, the cost estimate was built on the assumption that 

the military code signal being developed would fit on a single 

microchip. However, once development started, interface issues arose 

and the subcontractor had to move to a two-microchip design, which 

took 8 months to resolve and increased cost to the program. 

• Assumptions about TSPR savings: Four programs we examined 

assumed that there would be significant savings associated with 

adopting the TSPR policy. For example, while TSPR was supposed to 

relieve contractors of unnecessary oversight, the government assumed 

that the contractors would still maintain sufficient systems engineering 

and program management levels by following standard practices to 

provide oversight of their subcontractors and vendors. However, for a 

variety of reasons, the savings never materialized. For instance, it was 

believed that by giving more program management responsibility to 

contractors and increasing use of commercial equipment, the

government could reduce the number of in-house systems engineers—

who normally help the government define its requirements by analyzing 

differences between customer needs and technical possibilities and 

Page 9 GAO-07-96 Space Acquisitions
analyze progress in development. Ultimately, the reduction in systems 

engineering staff resulted in cost growth as the programs experienced 

technical and quality problems that the government was no longer in a 

position to detect and prevent. Programs also came to realize that 

commercial parts being relied on were not always suitable for their 

efforts, and had to resort to costly measures to address this problem. In 

addition, in implementing TSPR, the government initially entered into 

contracts that did not allow it to obtain certain cost data from the 

contractors (e.g., contractor cost data reports and contractor

performance reports), even though such data are critical for cost 

estimators to develop sound cost estimates and important for the 

government to maintain adequate insight. This was the case for EELV 

and GPS IIF—both of which have either been restructured or are now 

planning to issue follow-on contracts that will require cost and pricing 

data and earned value management data. It should be noted that the Air 

Force has since recognized problems related to its implementation of 

TSPR and rejected it as a recommended approach. 

• Assumptions about savings from heritage systems: Four programs 

assumed that they would be able to gain leverage from legacy satellite 

systems and save costs, but as the programs continued and more 

knowledge was gained about the requirements and the technologies 

needed to meet the requirements, DOD discovered that the legacy

systems could not be relied on, as initially believed, and the savings 

were not realized. In addition, SBIRS High and WGS, for example, had 

all planned to gain leverage from commercial satellite development 

efforts because the government had planned to use portions of these 

satellites as lessons already learned in order to obtain design savings. 

However, when hardware and software development advances were 

slowed as a result of the Internet sector economic downturn, the 

government had to carry more design and development costs than 

anticipated.

• Assumptions about weight growth: Four case study programs 

assumed no weight growth, which is among the highest drivers of cost 

growth for space systems, would occur despite leaps hoped for in 

technology and experiences in past programs. For example, the SBIRS 

High program assumed little to no weight growth, but the weight of the 

satellite spacecraft eventually grew by more than 59 percent, while 

payload aboard the spacecraft grew by 44 percent. Moreover, with such 

considerable weight growth, the program could no longer rely on the 

commercial bus it had originally selected for this acquisition, and 

instead had to develop a custom satellite bus—a more expensive 

endeavor. 

Page 10 GAO-07-96 Space Acquisitions
• Assumptions about funding: Space programs frequently experienced 

funding shifts. Moreover, at the time the Air Force undertook the 

programs included in our case studies, it was attempting to replenish 

several older satellite constellations, which put further stress on its 

total investment in space. Despite this condition, when making 

estimates on four programs we reviewed, cost estimators assumed that 

program budgets would remain stable. As the programs progressed 

through the acquisition cycle, they experienced changes to their 

funding stream, which created program instability and cost growth due 

to the stopping and starting of activities. Cost estimators and program 

officials we interviewed generally agreed that space programs are not 

often fully funded and that their programs have experienced shifts in 

funding. However, they could not separate the ultimate effects of 

funding shifts, since the programs were concurrently experiencing 

other problems, such as technical or design problems, which were also 

adding costs, and these funding cuts led to other decisions that had 

reverberating consequences. For example, in some cases, programs 

abandoned their original plans to purchase satellites in one 

procurement in favor of individual orders in an effort to address a 

funding cut. While this decision enabled the programs to continue in 

the short term, it had significant long-term consequences on program 

costs since the price of each satellite substantially increased with the 

change to individual orders. In previous testimony and reports, we have 

stressed that DOD could avoid the need to make costly funding shifts 

by developing an overall investment strategy that would prioritize 

systems in its space portfolio with an eye toward balancing 

investments between legacy systems and new programs as well as 

between science and technology programs and acquisition investments. 

Such prioritizing would also reduce incentives to produce low 

estimates. 

• Assumptions about schedules: Four case study programs assumed that 

compressed schedules being proposed could be achieved—even 

though the programs were pursuing ambitious leaps in capability or 

attempting new approaches, such as using commercial equipment for 

military purposes. Moreover, in some cases, DOD had data available 

demonstrating such schedules were not realistic. In one case study 

program, WGS, the request for proposals specified that the budget 

available was $750 million for three satellites plus ground control with 

a schedule constraint of 36 months. On the basis of these requirements, 

competing contractors were asked to offer maximum capacity, 

coverage, and connectivity via a contract that would make use of 

existing commercial practices and technologies. This aggressive 

schedule was never achieved. Instead, problems due to higher design 

Page 11 GAO-07-96 Space Acquisitions
complexity and supplier quality issues have caused the WGS schedule 

to stretch to 78 months for the first expected launch. Historically, the 

Air Force has required between 55 and 79 months to build satellites 

similar to WGS, so while the schedule slip is within the expected range, 

the original 36-month schedule was optimistic and not based on 

realistic data. For AEHF, the program accelerated its schedule in 

response to a potential gap in satellite coverage due to the launch 

failure of the third Milstar satellite. However, when the funding needed 

to achieve the acceleration was not delivered, the program experienced

cost and schedule delays. Again, because these assumptions were 

made before enough information about the development was available, 

the assumptions did not hold up, and the programs experienced cost 

and schedule growth as a result. 

• Assumptions about requirements growth: Three programs—AEHF, 

GPS IIF, and SBIRS High—did not assume any requirements growth, 

even though there was a risk of growth because of the variety of 

stakeholders involved. High-level requirements for the SBIRS High 

program—which is being developed to improve missile warning, 

missile defense, technical intelligence, and battle space 

characterization—have remained stable since the program began, but 

prior DOD studies have found that lower-level requirements were in 

flux and mismanaged until the program was restructured in 1999. 

According to DOD studies, this was partially due to the TSPR

approach, which placed too much responsibility on contractors to 

negotiate these requirements; the broad customer base for SBIRS; and 

the ambitious nature of the program to begin with. To illustrate, the 

SBIRS High program has 19 key performance parameters to satisfy— 

nearly five times more than the typical DOD space program. In 

addition, there are over 12,600 requirements that the program must 

address, and to date, requirements for external users have not been 

fully defined. DOD has since realized that responsibility for setting 

lower-level requirements should rest with the government and has 

taken actions to add more discipline to the requirements-setting 

process. In another example, GPS IIF was intended to follow on to the 

GPS II program, yet shortly after the contract was awarded, the 

government added the requirement for an additional auxiliary payload.

This requirement caused the satellite design to be larger than originally 

planned, and this, in turn, required a larger launch vehicle. 

Requirements for more robust jamming capability to secure satellite 

transmissions were also added. Changes from a two-panel to a threepanel solar array design and flexible power were necessary to allow for 

more power and thermal capability requirements. 

Page 12 GAO-07-96 Space Acquisitions
Appendix III contains additional detailed examples of instances where 

program officials were too optimistic in their assumptions for the six 

space system acquisitions we examined. 

Various incentives and pressures within DOD have contributed to 

optimistic program office cost estimates for space system acquisitions. As 

noted earlier, our prior work has found that programs are incentivized to

produce optimistic estimates in order to gain approval for funding. At 

present, DOD does not have a long-term investment strategy that would 

prioritize its investments and, in turn, reduce pressures associated with 

competition for funding. A 2003 DOD study on crosscutting problems 

affecting space acquisitions, known as the Young Panel report, also found 

that the space acquisition system, in particular, is strongly biased to 

produce unrealistically low cost estimates throughout the process; 

advocacy tends to dominate, and a strong motivation exists to minimize 

program cost estimates, and proposals from competing contractors 

typically reflected the minimum program content and a price to win. In 

responding to the Young Panel report as well as our prior reports, DOD 

officials have not disputed the need for long-term investment planning or

that programs are incentivized to produce low estimates. 

In conducting this review, we asked cost estimators, program managers, 

industry officials, and higher-level oversight officials what additional 

impediments there were to sound cost estimating for space. Their 

responses included that (1) there is little accountability for producing 

realistic program office estimates—among both program managers and 

estimators; (2) estimates produced within program offices are more often 

used to set budgets than estimates produced by independent estimators; 

(3) even though space programs experience frequent changes, 

independent cost estimates are not updated for years at a time; (4) costestimator roles and responsibilities are not clear and the cost-estimating 

function is fragmented; and (5) there are not enough in-house government 

cost estimators or sufficient data to support their work. 

It is difficult for cost estimators to be held accountable for the estimates 

they develop because program decision makers are rarely held 

accountable for the estimates they use to establish program budgets. This, 

coupled with the pressure to compete for funding, invites program 

officials to accept optimistic assumptions and ignore risk and reality when

developing cost estimates. 

Various Incentives 

and Pressures within 

DOD Have 

Contributed to CostEstimating 

Weaknesses 

Accountability Is Lacking 

Page 13 GAO-07-96 Space Acquisitions
This view was also expressed by many DOD program managers we 

interviewed for a 2005 review on program management best practices.8

While many program managers told us that they personally held 

themselves accountable, many also commented that it is difficult to be 

accountable when so much is outside their control. During our focus 

groups, program managers cited sporadic instances when program 

managers were removed from their positions or forced to retire if 

programs came in over cost or schedule, but they also cited instances 

when a program manager was promoted even though the program was 

experiencing difficulties.

Independent Estimates 

Not Always Relied Upon 

We found examples from our closer examinations of the AEHF, NPOESS, 

and SBIRS High programs where independent cost estimates were not 

relied upon by program decision makers. Independent estimates for these 

space system acquisitions forecasted considerably higher costs and 

lengthier schedules than program office or service cost estimates. Yet the 

milestone decision authorities used program office estimates or even 

lower estimates instead of the independent estimates to establish budgets 

for their programs. DOD’s current space acquisition policy requires that 

independent cost estimates be prepared by bodies outside the acquisition 

chain of command, and be considered by program and DOD decision 

makers. However, the policy does not require that the independent 

estimates be relied upon to set budgets, only that they be considered at 

key acquisition decision points. 

• AEHF: In 2004, AEHF program decision makers relied upon the 

program office cost estimate rather than the independent estimate 

developed by the CAIG to support the production decision for the 

AEHF program—which was more than $2 billion higher. At that time, 

the AEHF program office estimated the system would cost $6 billion. 

This was based on the assumption that AEHF would have 10 times 

more capacity than the predecessor satellite—Milstar—but at half the 

cost and weight. The CAIG believed that this assumption was overly 

optimistic given that the AEHF weight had more than doubled since the 

program began in 1999 to obtain the desired increase in data rate. The

latest program office estimate for AEHF is $6.1 billion. 

 8

 GAO, Best Practices: Better Support of Weapon System Program Managers Needed to

Improve Outcomes, GAO-06-110 (Washington, D.C.: Nov. 30, 2005). 

Page 14 GAO-07-96 Space Acquisitions
Table 2: Comparison of 2004 AEHF Program Office and Independent Cost Estimates 

Independent cost estimate 

Program office 

estimate AFCAA CAIG Difference

Latest 

program

office 

estimate

$6 billion AFCAA worked 

jointly with the 

CAIG to develop 

the independent 

estimate 

$8.7 billion 44% $6.1 billion 

Source: CAIG and GAO analysis. 

Note: Estimates are in fiscal year 2006 dollars. 

• NPOESS: In 2003, to support the NPOESS development decision, 

government decision makers relied on the program office’s $7.2 billion 

cost estimate rather than the $8.8 billion independent cost estimate 

presented by the Air Force Cost Analysis Agency. AFCAA based its 

estimate on an analysis of historical data from satellite systems, 

independent software and hardware models, and a risk simulation 

model using input from 30 independent engineers. The program office 

relied largely on the contractor’s proposal as well as on an unrealistic 

estimate of what it would cost to integrate the payloads onto the 

satellite bus. The program has encountered many problems as a result 

of these optimistic assumptions, and costs have risen to 

$11.4 billion, based on the latest program office cost estimate. 

Page 15 GAO-07-96 Space Acquisitions
Table 3: Comparison of 2003 NPOESS Program Office and Independent Cost 

Estimates 

Independent cost estimate 

Program office estimate AFCAA CAIG Difference

Latest 

program

office 

estimate

$7.2 billion (based on 

planned purchase of six 

satellites) 

$8.8 billion 23% $11.4 billion 

(based on 

planned 

purchase of 

four 

satellites)

Source: CAIG and GAO analysis. 

Note: Estimates are in fiscal year 2006 dollars. The CAIG was not involved in preparing the 2003 

independent cost estimate. 

SBIRS High. On the SBIRS High program, the program office and AFCAA 

predicted cost growth as early as 1996, when the program was initiated. 

While both estimates at that time were close, approximately $5.6 billion, 

both were much higher than the contractor’s estimated costs. The program 

was subsequently estimated to cost $3.6 billion by the program office, 

almost $2 billion less than the original AFCAA or program office estimate. 

The program office and contractor ultimately assumed savings under 

TSPR that did not materialize. For instance, with this approach, the SBIRS 

High contractor used far fewer systems engineers than historical data

show have been used for similar programs. To achieve savings, the 

contractor dropped important systems engineering tasks such as 

verification and cycling of requirements. The lack of systems engineering

resulted in latent design flaws that required more integration and testing 

when components failed initial testing. 

Table 4: Comparison of 1996 SBIRS High Program Office Cost Estimate and

Independent Cost Estimate 

Program office 

estimate 

AFCAA independent 

cost estimate

Total program

funding 

Latest program

office estimate

$5.7 billion (based 

on a planned 

purchase of five 

satellites) 

$5.6 billion $3.6 billion $10.2 billion (based 

on a planned 

purchase of three 

satellites)

Source: AFCAA and Air Force documentation and GAO analysis. 

Note: Estimates are in fiscal year 2006 dollars. 

Page 16 GAO-07-96 Space Acquisitions
We were informed by the CAIG that independent cost estimates are rarely 

used by the services to develop budgets for acquisition programs. Because 

CAIG estimates are seldom used and the program offices know this, 

officials we spoke with believe that there is no incentive on the part of 

program offices to change their approach to cost estimating. According to

a senior CAIG official, program managers often promise to meet the 

maximum amount of requirements for the least cost. These program 

officials would rather rely on optimistic cost estimates from the 

contractors because these estimates most likely align with program 

objectives. 

Appendix IV contains detailed examples of where program and costestimating officials disagreed on estimates. 

Independent Cost 

Estimates Not Updated 

Frequently Enough to 

Account for Significant 

Events and Changes 

It is possible for space programs to continue for years—as many as 4

years—without updates of independent cost estimates and to see changes 

within that span of time that have had a substantial impact on cost—

including changes in requirements, changes in planned quantities, funding

instability, design changes, quality variances resulting from rework, 

manufacturing or engineering changes, changes in supply chain and 

logistics management and support, technology-related problems, among 

others. At times, the only mechanism that forced an updated estimate was 

DOD policy that the CAIG support the Nunn-McCurdy certification 

process for programs breaching a certain unit cost threshold.9

 Under this 

policy,10 the CAIG provides the Under Secretary with a recommendation 

concerning the reasonableness of the most recent unit cost estimates by 

the program. 

Because space programs tend to experience such changes after program 

start, some officials we spoke with in the DOD space cost-estimating 

community believe that independent cost estimates should be updated 

more frequently. Opinions differ as to the frequency and phasing of these

 9

 10 U.S.C. § 2433. This oversight mechanism originated with the Department of Defense 

Authorization Act, 1982. It was made permanent in the following year’s authorization act

and has been amended several times. Generally, the law requires DOD to review programs

and report (and in some cases submit a certification) to Congress whenever cost growth

reaches specified thresholds. The statute is commonly known as Nunn-McCurdy, based on

the names of the sponsors of the original legislation. 

10 DOD Directive 5000.04 at ¶ 4.8. 

Page 17 GAO-07-96 Space Acquisitions
non milestone estimates, assessments, or reviews. A CAIG official 

suggested updating cost estimates about every 18 to 24 months, while 

AFCAA officials suggested annually to correspond with the annual 

budgeting cycle. The current space acquisition policy requires only one 

independent cost estimate after critical design review, but CAIG officials 

noted that years can go by between critical design review and program 

completion, during which time programs have historically experienced 

substantial changes. 

Figure 1 illustrates significant changes that took place on the SBIRS High 

program both before and after critical design review. 

Figure 1: Key Events and Funding Shifts That Occurred between Estimates for SBIRS High 

Oct. 1996

(KDP-B)

Dec. 2001-May. 2002

(Nunn-McCurdy certififcation)

Aug.-Dec. 2005

(Nunn-McCurdy certififcation)

25% program office

staff reduction 

(during design 

phase)

Mar. 2004

Sensor recovery

impacts satellite

Aug. 2001

Design 

review

May 1999

Program

restructure

May 2000

Major 

software

fixes

Dec. 2002

Sensor

payload

noise issues

Source: GAO analysis of SBIRS High program data.

Dec. 2003

New noise

issues

Sept. 2002

Contract

rebaseline

Oct. 2000

“Solar Flyer”

redesign

rebaseline

Nov. 1999

Increment 1

failed critical 

testing

Dec. 1998

$150 million

withdrawn

Nov. 1996

Contract 

value 

increase

$4.1 $4.3 $4.4 $7.1 $9.0 $9.0 $9.8 $10.2

Independent cost estimates

Change in program scope and content such as requirments and quantity changes

Programmatic changes such as funding reductions

Quality variances resulting from rework or manufacturing or engineering changes

Unforeseen problems such as teachnical risks and forgotten items

1996 1997 1998 1999 2000 2001 2002 2003 2004 2005

Cost-affecting

events

Independent

cost

estimates

Program cost

estimates

(dollars in billions)

Cost-Estimating Roles and 

Responsibilities Are 

Unclear 

Air Force cost-estimating officials believe that their roles and

responsibilities are not clear and that the cost-estimating function is too 

fragmented. Some also asserted that the cost-estimating function within 

the space community would be stronger if estimators themselves were 

Page 18 GAO-07-96 Space Acquisitions
centralized outside the acquisition chain of command so that they would

not be biased or pressured by program office leadership to produce 

optimistic estimates. 

In an attempt to make the most efficient use of the limited cost estimate 

expertise for DOD space system acquisitions, the space acquisition policy 

called on the CAIG to augment its own staff with cost-estimating 

personnel drawn from across the community to serve as team members 

when it developed independent estimates. Members were to include the 

intelligence community’s cost analysis improvement group, the Air Force 

Cost Analysis Agency, the National Reconnaissance Office (NRO) Cost 

Group, the Office of the Deputy Assistant Secretary of the Army for Cost 

and Economics, the Naval Center for Cost Analysis, the cost-estimating 

organizations of the Air Force Space Command, Air Force Space and 

Missile Systems Center, and the Space and Naval Warfare Systems 

Command. 

At this time, however, there are still significant disconnects in views about

roles and responsibilities. Officials who reside in the acquisition chain of

command—the Air Force Space and Missile Systems Center—believe that 

because the program executive officer and the program managers are 

responsible for executing the programs, they are also solely responsible 

for the cost estimates for the program. On the other hand, Air Force cost 

estimators outside the acquisition chain of command—the Air Force Cost 

Analysis Agency—believe they also hold some responsibility to ensure the 

quality and consistency of cost estimates and to produce independent cost 

estimates for consideration by Air Force decision makers. However, 

according to officials within the Space and Missile Systems Center’s (SMC) 

cost-estimating group and AFCAA, the SMC cost-estimating group sees no 

role for AFCAA in developing program or Air Force cost estimates and has 

rejected assistance from AFCAA. According to Air Force officials, until a 

clearer distinction of roles and responsibilities is defined by Air Force 

leadership, issues of conflicting policy interpretation and implementation 

will remain. It is also possible that these disconnects have been 

exacerbated by the perception that these two communities are competing 

for responsibility. 

In addition, according to a senior CAIG official, the collaborative process 

for developing independent estimates has not been achieved as 

envisioned—principally because those who should be involved have not

seen their involvement as a priority, and those who have been involved

have required a lot of extra training to be able to make valuable 

contributions. Moreover, because the various cost-estimating 

Page 19 GAO-07-96 Space Acquisitions
organizations each have different customers, agendas, and approaches to 

developing cost estimates, these differences have made it difficult for 

them to work as a cohesive team. 

Cost-Estimating Resources 

Are Considered Inadequate 

Air Force space cost-estimating organizations and program offices believe

that cost-estimating resources are inadequate to do a good job of 

accurately predicting costs. They believe that their cost-estimating 

resources have atrophied over the years because of previous downsizing 

of the workforce, making resources such as staff and data inadequate. 

As noted earlier, there was a belief within the government that cost 

savings could be achieved under acquisition reform initiatives by reducing 

technical staff, including cost estimators, since the government would be 

relying more on commercial-based solutions to achieve desired 

capabilities. According to one Air Force cost-estimating official we spoke 

with, this led to a decline in the number of Air Force cost estimators from 

680 to 280. High-grade positions and specialty cost-estimating job codes 

were eliminated, abolishing an official cost-estimating career path, and 

subordinating cost estimating as an additional duty. In the process, 

according to this same Air Force official, many military and civilian costestimating personnel left the cost-estimating field, and the Air Force lost 

some of its best and brightest cost estimators. 

Information we obtained from space program offices and cost-estimating 

organizations is consistent with the assertion of a lack of requisite 

resources. Eight of 13 cost-estimating organizations and program offices 

we informally surveyed believe the number of cost estimators is 

inadequate. Furthermore, some of these same organizations believe that

cost estimation is not a respected career field within the Air Force, and 

more specifically, that Air Force cost estimators are not encouraged, nor 

do they have opportunities for promotion or advancement. Regarding the 

recognition and career paths for cost estimators, our data showed that 

only 3 of 12 organizations agreed that previous cost estimators had moved 

on to positions of equal or higher responsibility. Further, only 4 of 

12 agreed that people ask to become cost estimators. 

The belief that cost-estimating skills have been depleted has been echoed 

in other DOD and GAO studies. According to the Young Panel report, 

government capabilities to lead and manage the acquisition process have 

seriously eroded, in part because of actions taken in the acquisition reform 

environment of the 1990s. This has extended to cost estimating. During 

our 2005 review of program management, we surveyed DOD’s major 

Page 20 GAO-07-96 Space Acquisitions
weapon system program managers and interviewed program executive 

officers who similarly pointed to critical skill shortages for staff that 

support them, including cost estimators. Other skill gaps identified 

included systems engineering, program management, and software 

development. We continue to observe these deficiencies in our more 

recent reviews of the space acquisition workforce.11

Because of the decline in in-house cost-estimating resources, space 

program offices and Air Force cost-estimating organizations are now more 

dependent on support contractors. Ten of 13 cost-estimating organizations

and program offices have more contractor personnel preparing cost 

estimates than government personnel. At 11 space program offices, 

contractors account for 64 percent of cost-estimating personnel. Support 

contractor personnel generally prepare cost estimates, while government

personnel provide oversight, guidance, and review of the cost-estimating 

work. By contrast, the CAIG had made a determination that cost 

estimating is too important of a function to place in the hands of support 

contractors, and assigns only government personnel to develop cost 

estimates. 

Reliance on support contractors raises questions from the cost-estimating 

community about whether numbers and qualifications of government 

personnel are sufficient to provide oversight of and insight into contractor

cost estimates. A senior CAIG official involved with estimating for space 

acquisition programs, for example, suggested that reliance on support 

contractors is a problem if the government cannot evaluate how good a 

cost estimate is or lacks the ability to track it. Two studies have also raised 

the concern that relying on support contractors makes it more difficult to

retain institutional knowledge and instill accountability. Further, in the 

most recent defense authorization act, Congress is requiring DOD to make

it a goal that within 5 years certain critical acquisition functions, including 

cost estimating, be performed by properly qualified DOD employees, and

that in developing a comprehensive strategy for supporting the program 

 11 GAO, Defense Space Activities: Management Actions Are Needed to Better Identify, 

Track, and Train Air Force Space Personnel, GAO-06-908 (Washington, D.C.: Sept. 21, 

2006), and Defense Acquisitions: DOD Needs to Establish an Implementing Directive to

Publish Information and Take Actions to Improve DOD Information on Critical 

Acquisition Positions, GAO-06-987R (Washington, D.C.: Sept. 8, 2006).

Page 21 GAO-07-96 Space Acquisitions
manager role, DOD address improved resources and support such as costestimating expertise.12

A second resource gap hampering cost estimating is the lack of reliable 

technical source data. Officials we spoke with believe that cost estimation 

data and databases from which to base cost estimates are incomplete, 

insufficient, and outdated. They cite a lack of reliable historical and 

current cost, technical, and programmatic data and expressed concerns 

that available cost, schedule, technical, and risk data are not similar to the 

systems they are developing cost estimates for. In addition, some 

expressed concerns that relevant classified and proprietary commercial 

data may exist but are not usually available to the cost-estimating 

community working on unclassified programs. Some believe that Air 

Force cost estimators need to be able to use all relevant data, including 

those contained in NRO cost databases, since the agency builds highly 

complex, classified satellites in comparable time and at comparable costs 

per pound. 

Over the past decade, GAO has examined successful organizations in the

commercial sector to identify best practices that can be applied to weapon

system acquisitions. This work has identified a number of practices that 

better support cost estimating than DOD does. For instance, unlike most 

space programs we have reviewed, the successful organizations we have

studied extensively researched and defined requirements before program 

start to ensure that they are achievable, given available resources. They do

not define requirements after starting programs. They also ensure 

technologies are mature, that is, proven to work as intended, and assign 

more ambitious efforts to corporate research departments until they are 

ready to be added to future increments. In addition, these organizations 

use systems engineering to close gaps between resources and 

requirements before launching the development process. Taken together, 

these practices help ensure that there is little guessing in how long or how 

many dollars it will take to achieve an intended capability. Moreover, 

within the organizations we studied, decisions to start programs are made 

through long-term strategic planning and prioritizing. As a result, 

competition for funding is minimized, and programs themselves do not 

have incentives to present low estimates. 

Successful 

Organization 

Approaches That 

Better Support Cost 

Estimating 

 12 John Warner National Defense Authorization Act for Fiscal Year 2007, Pub. L. No. 109-364 

§§ 820, 853 (2006). 

Page 22 GAO-07-96 Space Acquisitions
The successful organizations we have studied have taken additional steps 

to ensure cost estimates are complete and accurate that DOD has not. For 

instance, they hold program managers accountable for their estimates and 

require program managers to stay with a project to its end. At the same 

time, they develop common templates and tools to support data gathering

and analysis and maintain databases of historical cost, schedule, quality, 

test, and performance data. Cost estimates themselves are continually 

monitored and regularly updated through a series of numerous gates or 

milestone decisions that demand programs assess readiness and remaining 

risk within key sectors of the program as well as overall cost and schedule 

issues. 

Senior leaders within these organizations also actively encourage program

managers to share bad news about their programs and spend a great deal 

of time breaking down stovepipes and other barriers to sharing 

information. More important, they commit to fully funding programs and 

adhere to those commitments. Commonly, the organizations we studied 

have centralized cost estimators and other technical and business experts 

so that there is more effective deployment of technical and business skills 

while at the same time ensuring some measure of independence. Within 

DOD, the CAIG is a good example of this. Its cost estimates are produced 

by civilian government personnel (the sole military space cost estimating 

position will convert to a civilian position later on this year when the 

military cost estimator retires), to ensure long-term institutional 

knowledge and limit the effects of staff turnover that commonly occur 

with military personnel. Although the CAIG uses support contractors for 

conducting studies, it does not allow cost estimates to be developed by 

contractors. The CAIG takes this approach because it considers cost 

estimating to be a core function and therefore too important to contract 

out. The Naval Air Systems Command’s Cost Analysis Division is also 

considered a model by some in the cost-estimating community because of

its organizational structure and leadership support. It is a centralized cost 

department that provides support to multiple program offices. The 

department is headed by a senior executive-level manager, and various 

branches within the department are headed by GS-15-level managers. 

Analysts are somewhat independent of the program offices, as their 

supervisors are within the engineering department. This cost department 

has strong support from its leadership, and this support has helped it hire 

the number of analysts and receive the resources it needs. However, 

another official pointed out that this cost department is not completely 

independent from the acquisition chain of command, since it receives 

funding from the program offices to conduct the cost estimates. 

Page 23 GAO-07-96 Space Acquisitions
GAO has made recommendations to DOD to adopt best practices we have 

identified that would strengthen program management DOD-wide. 

Congress also recently directed DOD to develop a strategy to enhance 

program manager empowerment and accountability, agreeing with GAO’s 

assessment that DOD has consistently failed to give program managers the 

authority that they need to successfully execute acquisition programs and, 

as a result, is unable to hold them accountable.

13 GAO has also made 

recommendations to the Air Force to better position its space programs 

for success. In response, the Air Force has restructured its 

Transformational Satellite Communications System (TSAT) to ensure that 

the program incorporates technologies that have been proven to work as 

intended, and it has deferred more ambitious efforts to the science and 

technology community. It has committed to do the same on other 

programs. If effectively implemented, such actions would, in turn, 

significantly enhance the ability of independent estimators to forecast 

costs. However, we have testified that DOD faces a number of challenges 

and impediments in its effort to instill this approach. It needs significant 

shifts in thinking about how space systems should be developed, changes 

in incentives and perceptions; and further policy and process changes. 

And such changes will need to be made within a larger acquisition 

environment that still encourages a competition for funding and 

consequently pressures programs to view success as the ability to secure 

the next installment rather than the end goal of delivering the capabilities 

when and as promised. 

The Air Force has also been taking actions to make specific improvements 

to cost estimating for space programs. In the case of TSAT, program 

officials said they are updating the program’s planning cost estimate on an 

annual basis. Furthermore, according to one CAIG official, some program 

offices have recently been using the CAIG’s independent cost estimates. 

Both the SBIRS High and NPOESS program offices are developing their 

budgets based on the CAIG independent estimates that support the 

certification process for the programs’ most recent Nunn-McCurdy 

breaches. Further, DOD and Air Force cost estimators we spoke to 

recognize that amendments made to the Nunn-McCurdy law by the 2006 

Defense Authorization Act may increase realism in establishing initial cost 

estimates. As part of the revisions, DOD is barred from changing its 

 13 John Warner National Defense Authorization Act for Fiscal Year 2007, Pub. L. No. 

109-364, § 853 (2006), and accompanying conference report, H.R. Rep. No. 109-702, pages 

784-785. 

Page 24 GAO-07-96 Space Acquisitions
original baseline cost estimate for a program until after it has breached

certain Nunn-McCurdy thresholds that require a certification and 

assessment of the program, and DOD must report the baseline changes to

Congress. 

The Air Force has also committed to strengthening its cost-estimating 

capabilities in terms of people, methodologies, and tools. For instance, 

50 new cost estimators have recently been authorized to the AFCAA, some 

of whom may be detailed to the Space and Missile Systems Center. Finally, 

key players within the DOD space cost-estimating community are meeting 

on a regular basis to discuss issues, review recent findings from GAO and 

other groups, and explore lessons learned and potential ideas for 

improvement. 

Costs for DOD space acquisitions over the past several decades have 

consistently been underestimated—sometimes by billions of dollars. For 

the most part, this has not been caused by poor cost estimating itself, but 

rather the tendency to start programs before knowing whether 

requirements can be achieved within available resources. In fact, with so 

many unknowns about what could be achieved, how, and when, even the 

most rigorous independent cost estimate could have been off by a 

significant margin. Nevertheless, in the past, the Air Force has 

exacerbated acquisition problems by not relying on independent cost 

estimates and failing to encourage more realism in program planning and 

budgeting. Moreover, even after the Air Force embraced independent cost 

estimating in its acquisition policy for space, it did not facilitate better 

estimating by according the cost-estimating community with the 

organizational clout, support, and guidance the Air Force believes are 

needed to ensure the community’s analyses are used. On a positive note,

the Air Force has committed to addressing some of the root causes behind

cost growth, principally by accumulating more knowledge about 

technologies before starting new programs. Though adopting this 

approach will be challenging without larger DOD acquisition, funding, and

requirement-setting reforms, the Air Force can facilitate better planning 

and funding approaches by aligning resources and policy to support 

improved cost-estimating capability and by following through on its 

commitment to use independent estimates. 

Conclusions 

Page 25 GAO-07-96 Space Acquisitions
We recommend that the Secretary of Defense direct the Under Secretary 

of Defense for Acquisition, Technology and Logistics or the Secretary of 

the Air Force, as appropriate, to take the following actions: 

Recommendations for 

Executive Action 

1. To increase accountability and transparency of decisions in space 

programs where an independent estimate produced by the CAIG or 

AFCAA is not chosen, require officials involved in milestone decisions 

to document and justify the reasons for their choice and the 

differences between the program cost estimate and the independent 

cost estimate. 

2. To better ensure investment decisions for space programs are 

knowledge-based, instill processes and tools necessary to ensure 

lessons learned are incorporated into future estimates. This could 

include 

• conducting postmortem reviews of past space program cost 

estimates (program office and independent cost estimates) to 

measure cost-estimating effectiveness and to track and record costestimating mistakes; 

• developing a centralized cost-estimating database that provides

realistic and credible data to cost estimators; 

• establishing protocols by which cost estimators working with the 

National Reconnaissance Office can share data with the DOD space 

cost-estimating community while still maintaining appropriate

security over classified data; and 

• ensuring estimates are updated as major events occur within a 

program that could have a material impact on cost, such as budget 

reductions, integration problems, hardware/software quality 

problems, and so forth. 

3. To optimize analysis and collaboration within the space costestimating community, clearly articulate the roles and responsibilities 

of the various Air Force cost-estimating organizations, and ensure that 

space system cost estimators are organized so that the Air Force can 

gain the most from their knowledge and expertise. In taking these 

actions for programs for which no independent estimate is developed 

by the CAIG, consider assigning AFCAA the responsibility for the 

development of independent cost estimates for space system 

acquisitions, since it is outside of the acquisition chain of command 

and therefore likely to be unbiased and not pressured to produce 

optimistic estimates. 

Page 26 GAO-07-96 Space Acquisitions
DOD provided us with written comments on a draft of this report. DOD 

concurred with the overall findings in our report and provided technical 

comments, which have been incorporated where appropriate. DOD also 

concurred with two of our recommendations and partially concurred with 

one. 

Agency Comments 

and Our Evaluation 

DOD concurred with our recommendation to instill processes and tools 

necessary to ensure lessons learned are incorporated into future 

estimates. DOD stated it was already taking actions to address our 

recommendations. For example, the CAIG has established a process 

whereby key members of the national security space cost analysis 

community meet to discuss and evaluate outcomes following ACAT I 

space program milestone reviews or key decision point Defense 

Acquisition Board-level reviews, to provide visibility to other members of 

the community on how the CAIG approaches independent cost estimate 

development and to give the community an opportunity to provide 

feedback to the CAIG on how to improve its processes. DOD stated that 

the CAIG will work in the future to incorporate peer reviews of the 

program office estimates within this existing framework. DOD also 

concurred with our recommendation to develop a centralized costestimating database, and stated that several groups within the space costestimating community have been working to develop a database of 

historical space program costs available to the community as a whole, and

has also reestablished a common space program work breakdown 

structure that supports the various estimating methodologies employed by 

the space cost community. Through the common database development 

process, the community is working to make historical program cost data 

as widely available as possible. DOD also agreed with our 

recommendation to update cost estimates as major events occur within a 

program, as long as they are program and program phase dependent. 

Finally, DOD concurred with our recommendation to clearly articulate the 

roles and responsibilities of the various cost-estimating organizations. 

DOD stated that the Air Force is currently updating its policy directive to

further clarify the roles and responsibilities of the space cost analysis 

organizations to optimize analysis and collaborations, thus making the 

best use of the limited number of qualified and experienced space program 

cost analysts. We agree that these actions are steps in the right direction 

and that they will strengthen cost-estimating capabilities and improve 

space program cost estimates. 

DOD partially concurred with our recommendation to require officials 

involved in milestone decisions to document and justify the reasons for 

their cost estimate choice and the differences between the program cost 

Page 27 GAO-07-96 Space Acquisitions
estimate and the independent cost estimate. In commenting on this 

recommendation, DOD stated that the complex decision to determine 

which cost figure to use as basis for funding and to evaluate future 

program performance must weigh many competing factors that are often

qualitative in nature. It further stated that the decision is the milestone 

decision authority’s alone, and that documenting the explicit justification 

will reduce the milestone decision authority’s future decision-making 

flexibility. We do not see how documenting the explicit justification will 

significantly reduce the milestone decision authority’s future decisionmaking flexibility. While we recognize the value of decision-making 

flexibility and the role that judgment must play in such decisions, we also 

believe that the basis for the decisions should withstand review, 

particularly after the person who made the decision has left office. We also 

believe that the greater transparency of cost-estimating decisions that a 

documented justification provides is needed, particularly in light of the 

poor foundation of choices made in the past on space programs. 

We are sending copies of this report to interested congressional 

committees and the Secretaries of Defense and the Air Force. We will also 

provide copies to others on request. In addition, this report will be 

available at no charge on the GAO Web site at http://www.gao.gov. 

If you have any questions about this report or need additional information, 

please call me at (202) 512-4841 (chaplainc@gao.gov). Contact points for 

our Offices of Congressional Relations and Public Affairs may be found on

the last page of this report. GAO staff who made major contributions to 

this report are listed in appendix VI.

Cristina T. Chaplain 

Acting Director, Acquisition and Sourcing Management 

Page 28 GAO-07-96 Space Acquisitions
Appendix I: Scope and Methodology Appendix I: Scope and Methodology 

The Chairman and the Ranking Member, Subcommittee on Strategic 

Forces, House Committee on Armed Services, requested that we examine 

(1) in what areas space system acquisitions cost estimates have been 

unrealistic and (2) what incentives and pressures have contributed to the

quality and usefulness of cost estimates for space system acquisitions. 

To determine whether cost estimates for space system acquisitions have 

been realistic, we used a case study methodology. We selected six ongoing 

Air Force space system acquisitions. We selected these acquisitions 

because they were far enough along in their acquisition cycles for us to be 

able to observe changes in the programs since their initial cost estimates 

were developed. The six space system acquisitions are the Advanced 

Extremely High Frequency Satellites, the Evolved Expendable Launch 

Vehicle, the Global Positioning System IIF, the National Polar-orbiting 

Operational Environmental Satellite System, the Space Based Infrared 

System High, and the Wideband Gapfiller Satellites. For each of the case 

studies, we met with the program office representatives at the Air Force’s 

Space and Missile Systems Center and at the program’s prime contractors. 

We also obtained program cost and other program documentation to 

determine how the cost estimates were formulated and on what basis they

were formulated. 

To determine what incentives and pressures contributed to the quality and

usefulness of cost estimates for space system acquisitions, we examined 

Department of Defense (DOD) and Air Force policies for developing and 

updating cost estimates for space programs. We also used a data collection 

instrument to obtain information on cost-estimating practices and 

resources within the Air Force Cost Analysis Agency, at the Space and 

Missile Systems Center, and at the space program offices. We conducted

interviews with the Office of the Secretary of Defense’s Cost Analysis 

Improvement Group, the Air Force Cost Analysis Agency, and the Air 

Force Space and Missile Systems Center’s Cost Center. On the basis of the 

results of the data collection instruments and interviews, we obtained 

information on the organizational alignment of cost-estimating 

organizations, including roles and responsibilities, as well as concerns 

over the current cost-estimating policies and practices. 

We also relied on our previous best practice studies, which have examined 

pressures and incentives affecting space system acquisition programs, the 

optimal levels of knowledge needed to successfully execute programs, and 

complementary management practices and processes that have helped 

commercial and DOD programs to reduce costs and cycle time. Moreover,

we reviewed studies from the Defense Science Board, the DOD Inspector 

Page 29 GAO-07-96 Space Acquisitions
Appendix I: Scope and Methodology 

General, IBM, and others on space system acquisition and cost-estimating 

issues. 

Finally, we discussed the results of our work and our observations with an 

expert panel made up of representatives from the DOD space costestimating community. 

We conducted our review between August 2005 and October 2006 in 

accordance with generally accepted government auditing standards. 

Page 30 GAO-07-96 Space Acquisitions
Appendix II: DOD Acquisition Categories for Appendix II: DOD Acquisition Categories for Major Defense Acquisition Programs 

Major Defense Acquisition Programs 

An acquisition program is categorized based on dollar value and milestone 

decision authority special interest. Table 5 contains the description and 

decision authority for acquisition categories ID and IC. 

Table 5: DOD Acquisition Categories and Decision Authorities

Acquisition category (ACAT) Dollar value Milestone decision authority 

ACAT ID 

For designated major defense acquisition 

programs (special interest based on 

technological complexity, congressional

interest, large commitment of resources, 

critical role in achieving a capability, or a 

joint program) 

Research, development, test, and 

evaluation > $365 million 

Procurement > $2.19 billion 

Under Secretary of Defense for Acquisition, 

Technology and Logistics 

ACAT IC 

For major defense acquisition programs not 

designated as ACAT ID 

Research, development, test, and 

evaluation > $365 million 

Procurement > $2.19 billion 

Head of DOD component or, if delegated, 

DOD component or service acquisition 

executive 

Source: DOD Instruction 5000.2, Enclosure 2, which also lists other acquisition categories. 

Note: Dollar values are fiscal year 2000 constant dollars. 

Page 31 GAO-07-96 Space Acquisitions
Appendix III: Examples of Where Program 

Officials Were Too Optimistic in Their 

Assumptions 

Table 6 highlights major areas where program officials were too optimistic 

in their assumptions for the six space system acquisitions we examined— 

the Advanced Extremely High Frequency (AEHF) Satellites, the Evolved 

Expendable Launch Vehicle (EELV), the Global Positioning System (GPS) 

IIF, the National Polar-orbiting Operational Environmental Satellite 

System (NPOESS), the Space Based Infrared System (SBIRS) High, and 

the Wideband Gapfiller Satellites (WGS). 

Table 6: Examples of Optimistic Assumptions

Space program affected Examples 

Assumed industrial base would remain constant and available 

EELV The original contracting concept was for the Air Force to piggyback on the launch demand anticipated to 

be generated by the commercial sector. However, the commercial demand never materialized, and the 

government had to take on an additional cost burden. In addition, the cost for launch services increased 

because fixed infrastructure costs are being spread over 15 launches a year instead of the original 

expectation of 75 launches a year. 

GPS IIF A deteriorating manufacturing base of contractors and subcontractors caused the prime contractor to 

move the design team from Seal Beach, California, to Anaheim, California, in 2001. Additional moves 

occurred as the prime contractor consolidated development facilities to remain competitive. For each 

move, the prime contractor lost valuable workers, causing inefficiencies in the program. In addition, the 

contractor took additional cost-cutting measures that reduced quality. 

NPOESS A long production phase on this program increases the probability for parts obsolescence. Over 70 

percent of the value added to the program is from the supply base, and some critical parts that are 

unique to the program are produced by relatively small companies. In addition, workers required to have 

specialized skills must be United States citizens to obtain security clearances. The labor pool has to 

produce these specialized skills because degree programs currently do not produce them.

SBIRS High Consolidation within the supplier base has adversely affected the program. When suppliers merged, 

costs increased for supplier technical assistance, product rework, and hardware qualifications. In 

addition, unforeseen costs resulted when production processes and materials were changed and 

facilities and personnel were relocated. 

WGS At the time of contract award, the satellite industry was flourishing with commercial satellite orders, and 

the contractor anticipated a large market. However, when the installation of optical fiber communication 

lines became widespread, many of the commercial initiatives involving proposed space systems did not 

materialize. The government had planned to gain leverage from the design work of commercial 

contractors but ended up having to pay for design efforts. In addition, because of the reduction of the 

number of contracts awarded, small subcontractors started to consolidate. Specialized parts became 

obsolete, and the Air Force was no longer considered a high-priority customer. 

Assumed technology would be mature enough when needed 

AEHF AEHF faced several technology maturity problems including developing a digital processing system that 

would support 10 times the capacity of Milstar medium data rate without self-interference, and using 

phased array antennas at extremely high frequencies, which had never been done before. In addition, 

the change from a physical to an electronic process for crypto re-keys was not expected at the start of 

the AEHF. The predecessor program to AEHF was Milstar, which required approximately 2,400 crypto 

re-keys per month, which could be done physically. Regarding AEHF proposed capabilities, the number

of crypto re-keys is approximately 100,000, which is too large for a physical process and must be done 

electronically. Changing the way the re-keys were done called for a revolutionary change in the process 

and led to unexpected cost and schedule growth. 

Appendix III: Examples of Where Program 

Officials Were Too Optimistic in Their 

Assumptions 

Page 32 GAO-07-96 Space Acquisitions
Appendix III: Examples of Where Program 

Officials Were Too Optimistic in Their 

Assumptions 

Space program affected Examples 

GPS IIF The cost estimate was built on the assumption that the military code being developed in the program 

would fit on one chip. However, once development started, there were interface issues, and the 

subcontractor had to move to a two-chip design, which added cost growth to the program. In addition, 

the problem took 8 months to solve. 

NPOESS DOD and the Department of Commerce committed funds for the development and production of the 

satellites before the design was proven and before the technology was mature. At program initiation, 

only 1 of 14 critical technologies was mature, and some technology levels have been assessed 

downward. For example, the 1394 Bus Technology Readiness Level (TRL) was changed from 5 to 

4 after the contractor added more verification testing. 

SBIRS High In 2003, GAO reported that three critical technologies–-the infrared sensor, thermal management, and 

onboard processor—were now mature. When the program began, in 1996, none of its critical 

technologies was mature. 

WGS The X-band phased array antennas and the array power chips were the most difficult technologies to 

mature, because these state-of-the-art elements generated too much heat, which is very difficult to 

remove in outer space, so they had to be redesigned. 

Assumed Total System Performance Responsibility (TSPR) would reduce costs and schedule 

EELV The EELV program office entered into a TSPR contract that does not require the contractor to deliver 

cost or earned value management data. The program office stated that TSPR gave too many 

responsibilities to the contractor and not enough to the government. 

GPS IIF The contract that was awarded during acquisition reform efforts of the late 1990s adopted the TSPR 

approach. Under TSPR, there was limited oversight of the contractor, and this contributed to relaxed

specifications and inspections on commercial practices, loss of quality in the manufacturing process, and 

poor-quality parts that caused test failures, unexpected redesigns, and the late delivery of parts. 

NPOESS The NPOESS prime contractor has a Shared System Performance Responsibility (SSPR), which was an 

outgrowth of TSPR. The SSPR arrangement relegates the government’s role as a participant in 

contractor Integrated Product Team meetings. In addition, the program is managed by officials from 

three separate government agencies. DOD and Department of Commerce share the cost of funding the 

development of NPOESS, while NASA provides funding for specific technologies and studies. Difficulties 

have arisen with the tri-service approach to managing NPOESS, including ensuring NPOESS follows 

DOD’s acquisition process, but Commerce, which has control over the program, has no authority over 

the DOD process; each agency is driven by different program objectives (i.e., military, civilian, science); 

and NASA shares equally in managing the program even though it provides no funding for the 

development. 

SBIRS High When the original contract was awarded, acquisition reform efforts were being implemented and called 

for the use of commercial practices instead of government standards. In order to achieve cost savings, 

the SBIRS program office reduced critical up-front systems engineering design practices and follow-on 

quality assurance inspections based on the expectation that the contractor would perform these activities

with no government oversight. The prime contractor also held the same requirements for its 

subcontractors as a way to keep costs down. This lack of oversight resulted in difficulties in determining 

the root causes when components began to fail during testing. For example, there have been latent 

defects that required extensive corrective action and associated cost growth with the software redesign,

single board computer halts, payload reference bench rework, payload electromagnetic interference, 

software configuration issues, propulsion solder issues, and telescope foreign object damage. In 

addition, the contractor had responsibility to coordinate different agency needs, a responsibility that 

proved to be difficult when trying to resolve hardware interface issues. 

Page 33 GAO-07-96 Space Acquisitions
Appendix III: Examples of Where Program 

Officials Were Too Optimistic in Their 

Assumptions 

Space program affected Examples 

Assumed savings from heritage systems 

AEHF The program office cost estimators relied on data from heritage systems to estimate AEHF nonrecurring 

costs. The Cost Analysis Improvement Group (CAIG) believed the estimates based on heritage data 

were subjectively derived and therefore susceptible to bias. For example, AEHF program officials 

assumed that the nulling antennas would have the same performance as those on Milstar, requiring little 

if any development. In fact, because of parts obsolescence, personnel turnover, and other issues, the 

entire antenna had to be redesigned at nearly the same cost as the first one. There were similar beliefs 

that legacy processing technology could be used, which turned out to not be possible. Further, almost all 

of the payload software had to be rewritten to support the new hardware. As a result, there was much 

less technology transfer from Milstar II to AEHF, even though the contractor was the same. 

NPOESS NPOESS payload development proposals relied heavily on leveraging heritage satellite instrument 

technology development. The prime contractor and the program office agreed there was too much 

optimism regarding heritage sensor reuse. For example, the Visible Infrared Radiometer Suite (VIIRS) is 

more powerful and complex and will weigh 20 percent more than the heritage sensor that was used to 

base the estimate. In addition, the Conical Microwave Imager Sounder (CMIS) is much more complex 

than the heritage sensor, which took more than 8 years to develop. The program office estimated a 

4-year development schedule for CMIS. The latest cost estimate for CMIS is now approximately five 

times the initial estimate. 

SBIRS High The original estimate for nonrecurring engineering was significantly underestimated based on actual

experience in legacy sensor development and assumed software reuse. As a result, nonrecurring costs 

should have been two to three times higher according to historical data and independent cost estimators. 

WGS Originally, the contractor planned to gain leverage from a commercial satellite development effort—using

the same bus and phased array antenna. The commercial satellite development effort did not 

materialize, leaving DOD to pay for infrastructure and hardware design costs. This caused WGS costs to 

increase and the schedule to slip. 

Assumed no weight growth would occur 

AEHF When the cost estimate was initially developed, satellite payload weight was assumed to be constant by 

the program office. When updating its independent cost estimate in 2004, the CAIG found that the 

payload weight more than doubled between the start of development and critical design review. Weight 

increased because of the addition of phased array antennas, an antenna modification, and other 

requirements. 

NPOESS The CMIS sensor weight has almost doubled since the preliminary design review. As a result, 

engineering change proposals were issued to modify the spacecraft to accept the higher payload weight. 

SBIRS High Weight growth has occurred in the spacecraft and payload. The spacecraft has experienced weight 

growth of about 59 percent because of the need to lengthen and stiffen the structure, add a solar shield

to block sunlight from the payload, and add missing wire and harnessing. The geosynchronous earth 

orbit (GEO) payload has experienced nearly a 44 percent weight growth because of integration 

hardware, pointing, and control assembly. 

WGS Problems with solar panel concentrators overheating caused a solar panel redesign that led to additional 

weight growth in the spacecraft bus. 

Assumed funding stream would be sufficient and remain stable 

AEHF The AEHF program sustained a $100 million fiscal year 2002 funding cut. The program office reported 

that the funding cut would result in a 6-month launch delay to the first three satellites and a delay in

meeting initial operational capability. The program had rapidly staffed personnel to support a warfighter 

need. The funding cut resulted in contractor program reductions to fit within the revised fiscal year 2002 

budget. In addition, DOD made a decision to shift the acquisition strategy from buying five satellites at 

one time to buying three satellites as individual buys, which also caused costs to rise. 

Page 34 GAO-07-96 Space Acquisitions
Appendix III: Examples of Where Program 

Officials Were Too Optimistic in Their 

Assumptions 

Space program affected Examples 

GPS IIF The Operational Control Segment portion of the GPS IIF program received a $37.7 million funding cut in

fiscal year 2005. Because of the funding cut, the program delayed some of the software efforts and 

reduced some software requirements. 

NPOESS Between fiscal years 2004 and 2005, DOD reduced funding for the program by about $65 million. 

However, funding was reduced $130 million since the Department of Commerce contributes no more 

funding towards the program than DOD. The program office determined that the funding cut resulted in

satellite launch delays ranging from 5 to 26 months and a cost increase of $391.2 million. 

SBIRS High A funding cut in 1998-1999 because of higher budget priorities caused a reduction in the systems 

engineering staff and contributed to a 2-year delay of the geosynchronous earth orbit satellites. This cut

caused work activities to continually stop and restart and drove the need for interim solutions that 

resulted in program instability and cost growth. It also led to a breach of the acquisition program baseline 

in 2001, resulting in a change in the procurement strategy from a single buy of five satellites to two 

separate buys—one for two satellites and the other for three satellites. Independent cost estimators 

calculated that costs would double as a result of the change in procurement strategy. 

Assumed an aggressive schedule 

AEHF The first launch was originally scheduled for June 2006, but in response to a potential gap in satellite 

coverage due to the launch failure of the third Milstar satellite, DOD accelerated the schedule by 

18 months, aiming for a first launch in December 2004. An unsolicited contractor proposal stated that it 

could meet the accelerated date, even though all the requirements for AEHF were not fully determined. 

As a result, the program office knew that the proposed schedule was overly optimistic, but the decision 

was made at high levels in DOD to award the contract. However, DOD did not commit the funding to 

support the activities and manpower needed to design and build the satellites more quickly. Funding 

issues further hampered development efforts and increased schedule delays and contributed to cost 

increases. 

NPOESS When the estimate was developed, NPOESS was expected to be heavier, require more power, and have 

over twice as many sensors than heritage satellites. Yet the program office estimated that the satellites

would be developed, integrated, and tested in less time than heritage satellites. Independent cost 

estimators highlighted to the NPOESS program office that the proposed integration schedule was 

unrealistic when compared to historical satellite programs. Later, the CAIG cautioned the program office 

that not only was the system integration assembly and test schedule unrealistic, but the assumptions 

used to develop the estimate were not credible. 

SBIRS High The schedule proposed in 1996 did not allow sufficient time for geosynchronous earth orbit system 

integration and did not anticipate program design and workmanship flaws, which eventually cost the 

program considerable delays. In addition, the schedule was optimistic in regard to ground software 

productivity, and time needed to calibrate and assess the health of the satellite. There has been almost a 

3-year delay in the delivery of the highly elliptical orbit (HEO) sensors and a 6-year delay in the launch of 

the first GEO satellite. 

WGS The request for proposals specified that the budget available was $750 million for three satellites and the 

ground control system to be delivered within 36 months. On the basis of these requirements, competing 

contractors were asked to offer maximum capacity, coverage, and connectivity through a contract that 

would make use of existing commercial practices and technologies. However, higher design complexity 

and supplier quality issues caused the WGS schedule to stretch to 78 months for the first expected 

launch. Historically, DOD experienced between 55 and 79 months to develop satellites similar to WGS, 

so while DOD’s experience is within the expected range, the original 36-month schedule was unrealistic.

Page 35 GAO-07-96 Space Acquisitions
Appendix III: Examples of Where Program 

Officials Were Too Optimistic in Their 

Assumptions 

Space program affected Examples 

Assumed no growth in requirements 

AEHF DOD awarded the contract for AEHF before the requirements were fully established to fill the gap left by 

the Milstar launch failure. As a result, DOD frequently and substantially altered requirements in the early 

phases of the program and changed the system design. For example, a new requirement increased the

need for anti-jamming protection, which led to a cost increase of $100 million. In addition, new 

requirements related to training, support, and maintainability led to a cost increase of $90 million. 

GPS IIF GPS IIF was intended to follow on the GPS II program, yet shortly after the contract was awarded, the 

government added the requirement for an additional auxiliary payload. This requirement caused the 

satellite design to be larger than originally planned and, in turn, required a larger launch vehicle. 

Requirements for more robust jamming capability to secure satellite transmissions were also added. 

Changes from a two-panel to a three-panel solar array design and flexible power were necessary to 

allow for more power and thermal capability requirements. 

SBIRS High DOD is developing SBIRS High to improve missile warning, missile defense, technical intelligence, and 

battle-space characterization. As such, SBIRS has many customers, including the Air Force, Army, 

missile defense, and other agencies, each of which has its own requirements. This has resulted in 

complications in developing SBIRS, due to the fact that there are 19 key performance parameters to 

satisfy, which are about five times more than the typical DOD program. In addition, there are over 

12,600 requirements for the program to address, and to date, requirements from external users have not

been fully defined. Under the TSPR arrangement, the contractor was responsible for coordinating these

requirements. This effort was challenging and, according to a DOD official, one better suited for the 

government because all agencies were to agree on requirements. The SBIRS contractor encountered

numerous problems when trying to resolve the interface issues among the various agencies. Moreover, 

the development of interface control documents required different certification requirements for each 

agency, and the SBIRS contractor had limited systems engineers to handle the workload. This lack of 

staff resulted in many requirements not flowing down, which led to problems later on. 

Source: This table is based on conversations with program and contracting officials and analysis of data they provided. In some cases, 

we made our own designations based on our prior findings. 

Page 36 GAO-07-96 Space Acquisitions
Appendix

Cost Estimates

 IV: Examples Where Independent 

Were Not Relied Upon 

Page 37 GAO-07-96 

Appendix IV: Examples Where Independent 

Cost Estimates Were Not Relied Upon 

We found examples from our close examinations of the AEHF, NPOESS, 

and SBIRS High programs where independent cost estimates were not 

relied upon by program decision makers. Independent estimates for these 

space system acquisitions forecasted higher costs and lengthier schedules 

than program office or service cost estimates. This appendix provides 

detailed information on the differences between the program office cost 

estimates and the independent cost estimates for the AEHF, NPOESS, and 

SBIRS High programs. 

In 2004, AEHF program decision makers relied upon the program office 

cost estimate rather than the independent estimate developed by the CAIG 

to support the production decision for the AEHF program. At that time, 

the AEHF program office estimated the system would cost about 

$6 billion. This was based on the assumption that AEHF would have 

10 times more capacity than the predecessor satellite—Milstar—but at half

the cost and weight. However, the CAIG concluded that the program could 

not deliver more data capacity at half of the weight given the state of 

technology at that time. In fact, the CAIG believed that in order to get the 

desired increase in data rate, the weight would have to increase 

proportionally. As a result, the CAIG estimated that AEHF would cost 

$8.7 billion, and predicted a $2.7 billion cost overrun for the AEHF 

program. Table 7 displays the differences between the program office and

CAIG cost estimates. 

AEHF 

Table 7: Comparison of 2004 AEHF Program Office and Independent Cost Estimates 

Millions of fiscal year 2006 dollars 

Independent cost estimate 

Program office 

estimate AFCAA CAIG Difference

Latest program

office estimate

$6,015 a$8,688 44% $6,132

Source: CAIG and GAO analysis. 

a

AFCAA worked jointly with the CAIG to develop the independent estimate. 

The CAIG relied on weight data from historical satellites to estimate the 

cost of AEHF because it considers weight to be the single best cost 

predictor for military satellite communications. The historical data from 

the AEHF contractor showed that the weight had more than doubled since 

the program began and the majority of the weight growth was in the 

payload. The Air Force also used weight as a cost predictor, but attributed 

the weight growth to structural components rather than the more costly 

Space Acquisitions
Appendix IV: Examples Where Independent 

Cost Estimates Were Not Relied Upon 

payload portion of the satellite. When the CAIG briefed the Air Force on 

its estimate, the program office disagreed with the CAIG results, saying it 

did not see much payload weight growth in the data it analyzed. The CAIG 

reported that it used AEHF contractor cost reports to determine the 

amount of weight growth for the payload, and that these data were 

corroborated by AEHF monthly earned value management data, which 

showed cost overruns for the payload effort. As table 8 shows, the payload 

weight for the AEHF satellite increased about 116 percent. 

Table 8: Historical AEHF Weight Growth 

Milestone Date Payload weight (lbs) Percent growth

Milestone I (A) January 1999 1,694 n/a

Milestone II (B) May 2001 2,631 55

Preliminary design review August 2001 3,437 103

Critical design review April 2004 3,659 116

Source: CAIG. 

The Air Force attributed AEHF cost growth to problems to the 

cryptographic portion of the program, which is being developed by the 

National Security Agency (NSA). AEHF program officials stated that 

weight growth was consistent with that of other space programs. 

However, the CAIG stated that major cost growth was inevitable from the 

start of the AEHF program because historical data showed that it was 

possible to achieve a weight reduction or an increase in data capacity, but 

not both at the same time. 

In addition, the CAIG also stated that the Air Force was optimistic in 

developing the AEHF schedule estimate. During the production decision

review in 2004, the CAIG estimated the first satellite launch date to be 

28 months longer than the program office estimate, which the CAIG 

estimated to have no more than a 1 percent chance of success. The CAIG 

also stated that because of problems with cryptographic development and 

reliability concerns with other technical aspects of the program, such as 

the phased array antenna and digital signal processing, the ambitious 

AEHF schedule was in jeopardy, and the program would not likely be 

implemented as planned.

In February 2005, the CAIG reviewed the proposed revision to the AEHF 

Acquisition Program Baseline (APB). In a memorandum sent to the 

Assistant Secretary of Defense for Network and Information Integration, 

the CAIG chairman did not concur with the AEHF draft APB. The CAIG 

Page 38 GAO-07-96 Space Acquisitions
Appendix IV: Examples Where Independent 

Cost Estimates Were Not Relied Upon 

chairman explained that while the Air Force estimate included a 

24 percent increase to the average procurement unit cost, which was 1 

percent below the threshold for a Nunn-McCurdy certification, the CAIG’s 

estimate prepared in December 2004 projected an increase of over 

100 percent. Further, because of the vast differences between the Air 

Force and CAIG cost estimates, the CAIG chairman expressed concern 

that Congress would perceive the revised APB as an attempt to avoid a 

Nunn-McCurdy certification. 

There is still risk for the AEHF program costs to grow. As a result of 

delays, AEHF satellites have not yet been through thermal vacuum testing. 

Spacecraft must endure a wide range of temperatures associated with 

liftoff and ascent through the atmosphere and exposure to the extreme 

temperatures of space. The thermal environment is generally considered 

the most stressful operating environment for hardware, and electronic 

parts are especially sensitive to thermal conditions. Problems such as 

cracks, bond defects, discoloration, performance drift, coating damage,

and solder-joint failure have typically occurred. Thermal vacuum testing is 

used to screen out components with physical flaws and demonstrate that a 

device can activate and operate in extreme and changing temperatures. 

Because thermal vacuum testing provides the most realistic simulation of 

flight conditions, problems typically occur during testing. If this occurs on 

AEHF, more delays and cost overruns are likely. 

NPOESS provides another example of where there were large differences 

between program office and independent cost estimates. In 2003, 

government decision makers relied on the program office’s $7.2 billion 

cost estimate rather than the $8.8 billion independent cost estimate 

presented by the AFCAA to support the NPOESS development contract 

award. Program officials and decision makers preferred the more 

optimistic assumptions and costs of the program office estimate, viewing 

the independent estimate as too high. The $1.65 billion difference between 

the estimates is shown in table 9. 

NPOESS 

Page 39 GAO-07-96 Space Acquisitions
Appendix IV: Examples Where Independent 

Cost Estimates Were Not Relied Upon 

Table 9: Comparison of 2003 NPOESS Program Office and Independent Cost 

Estimates 

Millions of fiscal year 2006 dollars 

Independent cost estimate 

Program office 

estimate AFCAA CAIG Delta

Latest program

office estimate

$7,219 $8,869 a23% $11,400

Source: Air Force Cost Analysis Improvement Group briefing, April 2003. 

Note: The program office and the AFCAA cost estimates were based on a purchase of six satellites, 

and the latest estimate is based on a purchase of four satellites, with less capability and a renewed 

reliance on a European contribution. 

a

The CAIG was not involved in preparing the 2003 independent cost estimate. 

AFCAA based its estimate on an analysis of historical data from satellite 

systems (i.e., NASA’s Aqua and Aura and DOD’s Defense Meteorological 

Satellite Program [DMSP] program)1

 independent software and hardware 

models, and a risk simulation model using input from 30 independent 

engineers. The differences between the two estimates revolved around 

three major areas: 

• The first included a discrepancy of almost $270 million in the cost for 

ground software development. The program office estimated the cost 

at $90 million based on the contractor’s proposal for scaling the 

software and productivity rates that were highly optimistic. AFCAA 

based its estimate on a commercial software cost model using DSMP 

and SBIRS High historical software lines of code growth and actual 

productivity rates from the Global Positioning System program. 

• The second difference was in the assembly and integration and testing 

estimates. Compared to actual integration efforts on historical

satellites used by the AFCAA, the program office estimate to integrate 

the payloads onto the satellite bus was nearly $132 million less than 

AFCAA’s estimate. 

 1

 Aqua collects information on evaporation from the oceans, water vapor from the 

atmosphere, radioactive energy fluxes, land vegetation cover, and land, air, and water 

temperatures, among other things. Aura’s mission is to study the Earth’s ozone, air quality,

and climate focusing exclusively on the composition, chemistry, and dynamics of the

Earth’s upper and lower atmospheres. The Defense Meteorological Satellite Program 

collects weather data for military operations. 

Page 40 GAO-07-96 Space Acquisitions
Appendix IV: Examples Where Independent 

Cost Estimates Were Not Relied Upon 

• The third area involved the systems engineering and program 

management costs for space segment development and production. 

AFCAA used actual data from the Aqua and Aura satellites, while the 

program office relied on the contractor’s proposal—resulting in a 

difference of more than $130 million. The program office’s estimate 

was lower based on an assumption that the costs for systems 

engineering and program management would be reduced by almost 

50 percent between development and production. AFCAA stated 

concern that Aqua, Aura, and DMSP did not show a significant 

decrease in these costs over time. 

Because the program office’s estimate was lower, AFCAA concluded that

the program office’s cost and schedule estimates suffered from a lack of 

realism. However, the results of AFCAA’s independent cost estimate were 

not used by the program office officials and decision makers. 

In May 2004, the Under Secretary of the Air Force asked the CAIG to 

prepare an independent cost estimate for the NPOESS program. The 

estimate was completed in January 2005, following completion of the 

contractor’s re-evaluation of the program baseline in November 2004. The 

cost estimate focused primarily on the proposed integration schedule of 

the NPOESS satellites. This estimate, like AFCAA’s estimate before it, was 

based on historical cost data from analogous satellites and concluded that 

the program office’s proposed integration schedule for the program was 

unrealistic. For example, the program office proposed an integration 

schedule for the first NPOESS satellite that was about half the time needed 

for an analogous satellite that had almost the same number of sensors. In

other words, the NPOESS program estimated that it would integrate close 

to the same number of sensors in half the time. Table 10 illustrates how 

the program office developed its integration estimate for NPOESS, which 

was based on data from Aqua satellites. 

Table 10: Program Office Integration Estimates for NPOESS 

Program 

Number of 

sensors 

Months

to integrate 

based on

historical data

Months

to integrate 

sensor

Deletion of 

months due to

unforeseen

problems

Months to

integrate 

without 

problems

Months to

integrate 

sensor without 

problems

Aqua 6 31 5.2 -17 14 2.3

NPOESS (first 

satellite integration ) 

5 26 5.2 N/A 14 2.8

Source: NPOESS Executive Committee briefing, January 2005. 

Page 41 GAO-07-96 Space Acquisitions
Appendix IV: Examples Where Independent 

Cost Estimates Were Not Relied Upon 

The program office relied on actual data for Aqua, with no unforeseen 

problems as the basis for estimating the amount of time needed to 

integrate NPOESS sensors on the first satellite, rather than using historical

data that would have yielded an estimate of 26 months to integrate five 

sensors. The program office and the contractor contended that a novel 

approach was being taken to satellite integration on the NPOESS program. 

The CAIG disagreed with this contention, stating that the proposed 

integration approach was not really novel because the use of a test bed 

model is a common tool used by satellite programs and would not yield 

the significant savings asserted by the program office. The CAIG, instead, 

estimated 25 months for integrating five sensors based on Aqua, Aura, and 

DMSP historical data. As a result, the CAIG’s estimate was almost double 

the program office’s. The CAIG also expressed concern to program 

officials that the integration schedule was severely underestimated and

that the difference between the program office estimate and the CAIG’s 

estimate was more than 6 years. 

The program office’s 2003 estimate of $7.2 billion has been shown to be 

highly unrealistic, with significant cost overruns and schedule delays—

thus far—for sensor development only. Overall satellite integration efforts 

have been delayed due to the problems experienced in development of the 

sensors. In June 2006, the Office of the Secretary of Defense completed the 

Nunn-McCurdy process and certified a restructured program that reduced

the number of satellites to be developed—from six to four, with the first 

launch being delayed to 2013 from 2009. Cost has grown from the original 

estimate of nearly $7.2 billion to over $11.4 billion—approximately a 

60 percent increase. 

On the SBIRS High program, the program office and AFCAA predicted 

cost growth as early as 1996, when the program was initiated. While both 

estimates at that time were close ($5.7 billion in 2006 dollars by the 

program office and $5.6 billion in 2006 dollars by AFCAA), both were 

much more than the contractor’s estimated costs. Nevertheless, the 

program was subsequently budgeted at $3.6 billion by the program office, 

almost $2 billion less than the AFCAA or program office estimate. The 

CAIG stated that the SBIRS program assumed savings under TSPR that 

simply did not materialize. SBIRS program officials also planned on 

savings from simply rehosting existing legacy software, but those savings 

were not realized because the all software eventually was rewritten. 

Instead, it took 2 years longer than planned to complete the first increment 

of software. 

SBIRS High 

Page 42 GAO-07-96 Space Acquisitions
Appendix IV: Examples Where Independent 

Cost Estimates Were Not Relied Upon 

Savings were also assumed by the contractor in the area of systems 

engineering. The SBIRS High contractor initially estimated using fewer 

systems engineers, even though historical data showed programs similar 

to SBIRS High relied on three to almost four times the number of system 

engineers. Some of the tasks dropped from the systems engineering effort 

included verification and cycling of requirements because the government

assumed that the contractor would perform these activities with little or 

no oversight. The contractor also held the same requirements for its 

subcontractors, resulting in a program with limited systems engineering.

The lack of systems engineers has led to latent design flaws and 

substantially more integration and testing than planned because no one 

knew what had gone wrong when components began to fail during testing. 

This large amount of rework and troubleshooting has led to substantial 

cost and schedule increases. 

In 2005, the CAIG reviewed the SBIRS High production program including 

estimating the cost to develop geosynchronous earth orbiting (GEO) 

satellites 3–5 as clones of GEOs 1 and 2 in order to determine the cost 

growth incurred by the production program since 2002. The CAIG’s 

analysis projected a 25 percent Nunn-McCurdy breach in average 

procurement unit cost as a result of contractor cost and schedule 

performance being markedly worse than those experienced on historical 

satellite programs. In addition, the CAIG found that government actions to

date have been ineffective in controlling cost and schedule growth. The 

program office, on the other hand, showed a much lower cost estimate for 

the production cost of GEO satellites 3-5, as seen in table 11. 

Table 11: SBIRS High GEO 3–5 Procurement Funding Analysis 

Millions of then-year dollars 

Cost baseline 

CAIG 

estimate

Program 

office Delta Delta %

Three individual 

satellite 

procurements 

$2,892 $2,027 $865 43%

Source: CAIG and GAO analysis. 

The CAIG based its estimate on contractor data for prime contractor 

systems engineering and program management, and payload integration 

assembly and test, which showed substantial increases in the period of 

performance, staffing levels, and hourly rates over initial estimates. In 

addition, the CAIG’s estimate reflected a contractual change from a shared 

fee pool to a traditional prime contractor/subcontractor relationship. 

Page 43 GAO-07-96 Space Acquisitions
Appendix IV: Examples Where Independent 

Cost Estimates Were Not Relied Upon 

The CAIG expressed concern that despite restructuring and rebaselining

the program, SBIRS High has struggled unabated since contract award. 

The CAIG also cautioned that rebaselining would only allow the program 

to hide problems in the short term. For example, the CAIG reported that 

earned value management data showed GEO costs were following the 

same downward trend as the HEO portion of the program, which meant 

that additional cost and schedule delays were possible. 

Page 44 GAO-07-96 Space Acquisitions
Appendix V: Comments from the Department Appendix V of Defense : Comments from the Department 

of Defense 

Page 45 GAO-07-96 Space Acquisitions
Appendix V: Comments from the Department 

of Defense 

Page 46 GAO-07-96 Space Acquisitions
Appendix V: Comments from the Department 

of Defense 

Page 47 GAO-07-96 Space Acquisitions
Appendix V: Comments from the Department 

of Defense 

Page 48 GAO-07-96 Space Acquisitions
Appendix VI: 

A

GAO Contacts and Staff 

cknowledgments 

Page 49 GAO-07-96 

Appendix VI: GAO Contacts and Staff 

Acknowledgments 

Cristina T. Chaplain (202) 512-4859 or chaplainc@gao.gov

In addition to the contact named above, Brian Bothwell, Greg Campbell, 

Joanna Chan, Jennifer Echard, Art Gallegos, Barbara Haynes, 

Anne Hobson, Jason Lee, Sigrid McGinty, Karen Richey, Suzanne Sterling,

Adam Vodraska, and Peter Zwanzig made key contributions to this report. 

GAO Contact 

Staff 

Acknowledgments 

Space Acquisitions
Related GAO Products 

Page 50 GAO-07-96 

Related GAO Products 

Defense Space Activities: Management Actions Are Needed to Better 

Identify, Track, and Train Air Force Space Personnel. GAO-06-908. 

Washington, D.C.: September 21, 2006. 

Defense Acquisitions: DOD Needs to Establish an Implementing 

Directive to Publish Information and Take Actions to Improve DOD 

Information on Critical Acquisition Positions. GAO-06-987R. 

Washington, D.C.: September 8, 2006. 

Defense Acquisitions: Space System Acquisition Risks and Keys to 

Addressing Them. GAO-06-776R. Washington, D.C.: June 1, 2006. 

Space Acquisitions: Improvements Needed in Space Systems

Acquisitions and Keys to Achieving Them. GAO-06-626T. Washington, 

D.C.: April 6, 2006. 

Best Practices: Better Support of Weapon System Program Managers 

Needed to Improve Outcomes. GAO-06-110. Washington, D.C.: November 

30, 2005. 

Defense Acquisitions: Incentives and Pressures That Drive Problems 

Affecting Satellite and Related Acquisitions. GAO-05-570R. Washington,

D.C.: June 23, 2005. 

Defense Acquisitions: Improved Management Practices Could Help 

Minimize Cost Growth in Navy Shipbuilding Programs. GAO-05-183. 

Washington, D.C.: February 28, 2005.

NASA: Lack of Disciplined Cost-Estimating Processes Hinders Effective 

Program Management. GAO-04-642. Washington, D.C.: May 28, 2004. 

Defense Acquisitions: Despite Restructuring, SBIRS High Program 

Remains at Risk of Cost and Schedule Overruns. GAO-04-48. Washington,

D.C.: October 31, 2003. 

Defense Acquisitions: Improvements Needed in Space Systems 

Acquisition Management Policy. GAO-03-1073. Washington, D.C.: 

September 15, 2003. 

Military Space Operations: Common Problems and Their Effects on 

Satellite and Related Acquisitions. GAO-03-825R. Washington, D.C.: June 

2, 2003. 

(120554) Space Acquisitions
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