U.S. GOVERNMENT PUBLISHING OFFICE

30–875PDF WASHINGTON : 2018

NASA COST AND SCHEDULE OVERRUNS: 

ACQUISITION AND PROGRAM 

MANAGEMENT CHALLENGES 

HEARING 

BEFORE THE

SUBCOMMITTEE ON SPACE 

COMMITTEE ON SCIENCE, SPACE, AND 

TECHNOLOGY 

HOUSE OF REPRESENTATIVES 

ONE HUNDRED FIFTEENTH CONGRESS 

SECOND SESSION 

JUNE 14, 2018 

Serial No. 115–64 

Printed for the use of the Committee on Science, Space, and Technology 

( 

Available via the World Wide Web: http://science.house.gov 
(II) 

COMMITTEE ON SCIENCE, SPACE, AND TECHNOLOGY 

HON. LAMAR S. SMITH, Texas, Chair 

FRANK D. LUCAS, Oklahoma 

DANA ROHRABACHER, California 

MO BROOKS, Alabama 

RANDY HULTGREN, Illinois 

BILL POSEY, Florida 

THOMAS MASSIE, Kentucky 

RANDY K. WEBER, Texas 

STEPHEN KNIGHT, California 

BRIAN BABIN, Texas 

BARBARA COMSTOCK, Virginia 

BARRY LOUDERMILK, Georgia 

RALPH LEE ABRAHAM, Louisiana 

GARY PALMER, Alabama 

DANIEL WEBSTER, Florida 

JIM BANKS, Indiana 

ANDY BIGGS, Arizona 

ROGER W. MARSHALL, Kansas 

NEAL P. DUNN, Florida 

CLAY HIGGINS, Louisiana 

RALPH NORMAN, South Carolina 

DEBBIE LESKO, Arizona 

EDDIE BERNICE JOHNSON, Texas 

ZOE LOFGREN, California 

DANIEL LIPINSKI, Illinois 

SUZANNE BONAMICI, Oregon 

AMI BERA, California 

ELIZABETH H. ESTY, Connecticut 

MARC A. VEASEY, Texas 

DONALD S. BEYER, JR., Virginia 

JACKY ROSEN, Nevada 

CONOR LAMB, Pennsylvania 

JERRY MCNERNEY, California 

ED PERLMUTTER, Colorado 

PAUL TONKO, New York 

BILL FOSTER, Illinois 

MARK TAKANO, California 

COLLEEN HANABUSA, Hawaii 

CHARLIE CRIST, Florida 

SUBCOMMITTEE ON SPACE

HON. BRIAN BABIN, Texas, Chair 

DANA ROHRABACHER, California 

FRANK D. LUCAS, Oklahoma 

MO BROOKS, Alabama 

RANDY HULTGREN, Illinois 

BILL POSEY, Florida 

STEPHEN KNIGHT, California 

BARBARA COMSTOCK, Virginia 

RALPH LEE ABRAHAM, Louisiana 

DANIEL WEBSTER, Florida 

ANDY BIGGS, Arizona 

NEAL P. DUNN, Florida 

CLAY HIGGINS, Louisiana 

LAMAR S. SMITH, Texas 

AMI BERA, California, Ranking Member 

ZOE LOFGREN, California 

DONALD S. BEYER, JR., Virginia 

MARC A. VEASEY, Texas 

DANIEL LIPINSKI, Illinois 

ED PERLMUTTER, Colorado 

CHARLIE CRIST, Florida 

BILL FOSTER, Illinois 

EDDIE BERNICE JOHNSON, Texas 
(III) 

C O N T E N T S 

June 14, 2018 

Page 

Witness List ............................................................................................................. 2 

Hearing Charter ...................................................................................................... 3 

Opening Statements 

Statement by Representative Brian Babin, Chairman, Subcommittee on 

Space, Committee on Science, Space, and Technology, U.S. House of Representatives ........................................................................................................... 4 

Written Statement ............................................................................................ 6 

Statement by Representative Ami Bera, Minority Ranking Member, Subcommittee on Space, Committee on Science, Space, and Technology, U.S. 

House of Representatives .................................................................................... 8 

Written Statement ............................................................................................ 10 

Statement by Representative Lamar Smith, Chairman, Committee on Science, 

Space, and Technology, U.S. House of Representatives .................................... 12 

Written Statement ............................................................................................ 14 

Statement by Representative Eddie Bernice Johnson, Ranking Member, Committee on Science, Space, and Technology, U.S. House of Representatives .... 16 

Written Statement ............................................................................................ 17 

Witnesses: 

Ms. Cristina Chaplain, Director, GAO: Contracting and National Security 

Acquisitions 

Oral Statement ................................................................................................. 19 

Written Statement ............................................................................................ 22 

Mr. Steve Jurczyk, Associate Administrator, NASA 

Oral Statement ................................................................................................. 58 

Written Statement ............................................................................................ 60 

Mr. Paul Martin, Inspector General, NASA 

Oral Statement ................................................................................................. 68 

Written Statement ............................................................................................ 70 

Mr. Daniel L. Dumbacher, Executive Director, American Institute of Aeronautics and Astronautics (AIAA) 

Oral Statement ................................................................................................. 79 

Written Statement ............................................................................................ 81 

Discussion ................................................................................................................. 89 

Appendix I: Answers to Post-Hearing Questions 

Ms. Cristina Chaplain, Director, GAO: Contracting and National Security 

Acquisitions .......................................................................................................... 112 

Mr. Steve Jurczyk, Associate Administrator, NASA ............................................ 122 

Mr. Paul Martin, Inspector General, NASA .......................................................... 136 

Mr. Daniel L. Dumbacher, Executive Director, American Institute of Aeronautics and Astronautics (AIAA) ........................................................................ 139 
Page

IV 

Appendix II: Additional Material for the Record 

Documents submitted by NASA ............................................................................. 144 
(1) 

NASA COST AND SCHEDULE OVERRUNS: 

ACQUISITION AND PROGRAM 

MANAGEMENT CHALLENGES 

THURSDAY, JUNE 14, 2018 

HOUSE OF REPRESENTATIVES, COMMITTEE ON SCIENCE, SPACE, AND TECHNOLOGY, Washington, D.C. 

The Subcommittee met, pursuant to call, at 10:04 a.m., in Room 

2318 of the Rayburn House Office Building, Hon. Brian Babin 

[Chairman of the Subcommittee] presiding. 
2 

LAMAR$ 51\li!H, 

CHAiflM,\N 

[ongress of the ilnited ,States 

tilousr or 1Rrprcscntntiors COMMITTEE ON SCIENCE, SPACE, AND TECHNOLOGY 

2321 RAYBURN HOUSE 0fFtC£ 8Ull01NG 

WASHINGTON, DC 20515-6301 

(202) 225-6371 

EODif DHINIC( JOJINSON, T~'"s 

RA.NKING MEMBER 

NASA Cost and Schedule Overruns: Acquisition and Program 

Management Challenges 

Thursday, June 14,2018 

!O:OOa.m. 

2318 Rayburn House Office Building 

Witnesses 

Ms. Cristina T. Chaplain, Director, Contracting and National Security 

Acquisitions, GAO 

Mr. Stephen Jurczyk, Associate Administrator, NASA 

Mr. Paul K. Martin, Inspector General, NASA 

Mr. Daniel L. Dumbacher, Executive Director, American Institute of 

Aeronautics and Astronautics 
3 

TO: 

FROM: 

DATE: 

SUBJECT: 

U.S. HOUSE OF REPRESENTATIVES 

COMMITTEE ON SCIENCE, SPACE, AND TECHNOLOGY 

Charter 

Members, Committee on Science, Space, and Technology 

Majority Staff: Committee on Science, Space, and Technology 

June 7, 2018 

Space Subcommittee Hearing: ·'NASA Cost and Schedule Overruns: Acquisition 

and Program Management Challenges" 

On Thursday, June 14 at I 0:00 a.m. in Room 2318 of the Rayburn House Office 

Building, the Subcommittee on Space will hold a hearing titled, ''NASA Cost and Schedule 

Overruns: Acquisition and Program Management Challenges." 

Hearing Purpose 

The purpose of the hearing is to focus discussion on the Government Accountability 

Office's (GAO) 2018 Quick Look report (published on May I, 2018), this report's assessments 

of major National Aeronautics and Space Administration (NASA) projects, and a comparison of 

this 2018 assessment to cost control and program management trends that GAO and the NASA 

Inspector General (IG) assessed in previous years. Additional cost control and program 

management discussion will be gleaned from NASA's response to the 2018 GAO report and the 

updated WFIRST space telescope cost estimate required by the FYI8 Omnibus and due to the 

appropriate committees by May 22,2018. Furthermore, the NASA TG will provide related 

testimony drawn from prior year audits and reports on the Joint Confidence Level (JCL) process 

and the management of major projects and programs. This hearing is not intended to restrict 

discussion to just observed problems. Identifying recommendations for improvement is 

necessary, especially for assessing the sufficiency of existing appropriation funding authorities, 

existing cost-estimating methodologies, contracting and other acquisition mechanisms, program 

management, and incentivizing/disincentivizing good contractor and program management 

performance. 

Witnesses 

• Ms. Cristina Chaplain, Director, GAO: Contracting and National Security 

Acquisitions 

• Mr. Steve Jurczyk, Associate Administrator, NASA 

• Mr. Paul Martin, Inspector General, NASA 

• Mr. Daniel L. Dumbacher, Executive Director, American Institute of Aeronautics and 

Astronautics (AIAA) 

Staff Contact 

For questions related to the hearing, please contact Dr. Michael Mineiro, Staff Director, 

Space Subcommittee, Dr. Samuel Amber, Professional Staff Member, Space Subcommittee, or 

Ms. Sara Ratliff. Policy Assistant, Space Subcommittee, at 202-225-6371. 
4 

Chairman BABIN. Good morning. The Subcommittee on Space 

will come to order. 

Without objection, the Chair is authorized to declare recesses of 

the Subcommittee at any time. 

Welcome to today’s hearing titled, ‘‘NASA Cost and Schedule 

Overruns: Acquisition and Program Management Challenges.’’ 

I will now recognize myself for five minutes for an opening statement. 

NASA is at a critical juncture as it lays out the details of its 

roadmap for human exploration missions while determining the 

best business approach to success. However, human exploration 

doesn’t encompass the breadth of NASA’s total work. They are also 

launching interplanetary spacecraft systems, advancing science and 

aeronautics research, and developing critical technologies to enable 

U.S. leadership in space. Strategic acquisition planning, utilization 

of new contracting mechanisms, and improving management and 

oversight will be a crucial part of effective, affordable, and sustainable mission success for NASA. 

As Chairman of the Space Subcommittee and a proud representative of Johnson Space Center in Houston, I am a tireless advocate 

for NASA. However, as Members of this Committee, we have a responsibility to every taxpayer to ensure that NASA is being a good 

steward, managing the resources with which we have been entrusted. Today’s hearing will touch upon a number of important 

oversight topics, including acquisition mechanisms, cost-estimation 

methodologies, and NASA program management. 

Procurements represent over 90 percent of NASA’s annual budg- et. In fiscal year 2016, NASA procured over $18.6 billion through 

nearly 41,000 active procurements. That’s a tremendous amount of 

work. Unfortunately, NASA has been plagued for years with contract management issues, which have resulted in substantial cost 

overruns and schedule slips. Generally, it’s the high-profile, major 

programs which get the most scrutiny because of the funding and 

time associated with these procurements. However, there are other 

well-documented issues, many of which could constitute and possibly warrant a dedicated hearing. 

In May of this year, the Government Accountability Office released its annual Assessment of Major NASA Projects, those exceeding $250 million in appropriations. This assessment covered 26 

major projects. I’d like to note the Subcommittee will have a dedicated hearing about the James Webb Space Telescope next month, 

but this project’s long history of cost and schedule overruns is relevant to today’s discussion as well. 

GAO reported an overall deterioration in the major program 

portfolio, primarily due to the fact that 9 out of 17 projects in development are experiencing cost and schedule performance growth 

as a result of risky program management decisions, significant 

technical challenges, and issues beyond the control of the projects. 

Last year, GAO assessed that NASA projects were ‘‘continuing a 

generally positive trend of limiting cost and schedule growth, maturing technologies, and stabilizing designs.’’ However, GAO also 

noted that many of the more expensive projects were ‘‘approaching 

the phase of their life—their lifecycles when cost and schedule 

growth is most likely.’’ 
5 

The Subcommittee will also investigate specific NASA cost-estimating methodologies such as the Joint Cost and Schedule Confidence Level, the JCL process, and NASA management techniques 

related to project schedule determination and the use of headquarters reserve funding. We are particularly interested in the 

NASA Inspector General’s recommendations on improvements with 

NASA’s cost estimating methodologies, especially if there is a need 

to continue using the JCL process or adopt another cost-estimating 

technique. 

Furthermore, the Subcommittee will investigate these and other 

questions: What acquisition mechanisms—cost plus, fixed price, 

award fee, Space Act Agreements, et cetera—are most appropriate 

for various types of procurements? 

Next, how do these acquisition tools incentivize the provider to 

perform safely and efficiently? What are the pros and cons? 

And then, are existing appropriation funding authorities sufficient for Congressional oversight of major NASA projects? 

And lastly, do current agency approaches hold both the agency 

and provider accountable for overall performance? 

And this is a very timely hearing today. In their report last month, GAO noted that NASA is planning to invest about $61 billion over the lifecycle of its current portfolio of 26 major programs, 

and that doesn’t even account for thousands of other procurements 

and a significant portion of NASA’s spending authority. Whether 

large or small, all of NASA’s business decisions matter. Decisions 

made now have long-lasting implications on NASA’s mission success and leadership. 

I want to thank the witnesses for being here. I’m sorry I was a 

little bit late, didn’t get a chance to shake each of your hands, but 

we’re looking forward to your testimony on the challenges that 

NASA is facing in controlling program cost and schedule. 

[The prepared statement of Chairman Babin follows:] 
6 

COMMITTEE ON 

SCIENCE, SPACE~ & TECHNOLOGY Lamar Smith, Chairman 

For Immediate Release 

June 14,2018 

Media Contacts: Thea McDonald, Bridget Dunn 

(202) 225-6371 

Statement by Chairman Brian Babin (R-Texas) 

NASA Cost and Schedule Overruns: Acquisition and Program Management Challenges 

Chairman Babin: NASA is at a critical juncture as it lays out the details of its roadmap tor 

human exploration missions, while determining the best business approach to success. 

However, human exploration doesn't encompass the breadth of NASA's work. They are also 

launching interplanetary spacecraft systems, advancing science and aeronautics research 

and developing critical technologies to enable U.S. leadership in space. 

Strategic acquisition planning, utilization of new contracting mechanisms and improving 

management and oversight will be a crucial part of effective, affordable and sustainable 

mission success for NASA. 

As the chairman of the Space Subcommittee and a proud representative of Johnson Space 

Center, I am a tireless advocate for NASA. However, as members of this committee, we have 

a responsibility to every tax-payer to ensure that NASA is being a good steward, managing 

the resources with which they are entrusted. Today's hearing will touch upon a number of 

important oversight topics, including acquisition mechanisms, cost-estimation methodologies 

and NASA program management. 

Procurements represent over 90 percent of NASA's annual budget. In FY16, NASA procured 

over $18.6 billion through nearly 41 thousand (40,914) active procurements-that's a 

tremendous amount of work. 

Unfortunately, NASA has been plagued for years with contract management issues which 

have resulted in substantial cost overruns and schedule slips. Generally, it's the high-profile, 

major programs which get the most scrutiny because of the funding and time associated 

with these procurements. However, there are other well-documented issues many of which 

could constitute and possibly warrant a dedicated hearing. 

In May of this year, the Government Accountability Office (GAO) released its annual 

Assessment of Major NASA Projects, those exceeding $250 million in appropriations: this 

assessment covered 26 major projects. 

I'd like to note the subcommittee will have a dedicated hearing about the James Webb 

Space Telescope next month, but this project's long history of cost and schedule overruns is 

relevant to today's discussion. 
7 

GAO reported an overall deterioration in the major program portfolio-primarily due to the 

fact that 9 of 17 projects in development are experiencing cost and schedule performance 

growth as a result of risky program management decisions, significant technical challenges 

and issues beyond the control of the projects. 

Last year, GAO assessed that NASA projects were "continuing a generally positive trend of 

limiting cost and schedule growth, maturing technologies and stabilizing designs." However, 

GAO also noted that many of the more expensive projects were "approaching the phase in 

their life cycles when cost and schedule growth is most likely." 

The subcommittee will also investigate specific NASA cost estimating methodologies such as 

the Joint Cost and Schedule Confidence Level (JCL) process and NASA management 

techniques related to project schedule determination and the use of headquarters reserve 

funding. 

We are particularly interested in the NASA Inspector General's (IG) recommendations on 

improvements with NASA's cost estimating methodologies, especially if there is a need to 

continue using the JCL process or adopt another cost estimating technique. 

Furthermore, the subcommittee will investigate these and other questions: 

• What acquisition mechanisms (cost plus, fixed price, award fee, space act 

agreements, etc.) are most appropriate for various types of procurements? 

• How do these acquisition tools incentivize the provider to perform safely and 

efficiently? What are the pros and cons? 

• Are existing appropriation funding authorities sufficient for congressional oversight of 

major NASA projects? 

• Do current agency approaches hold both the agency and provider accountable for 

overall performance? 

This is a very timely hearing. In their report last month, GAO noted that NASA is planning to 

invest about $61 billion over the life-cycle of its current portfolio of 26 major programs-and 

that doesn't even account for thousands of other procurements and a significant portion of 

NASA's spending authority. Whether large or small, all of NASA's business decisions matter. 

Decisions made now have long lasting implications on NASA's mission success and 

leadership. 

I thank the witnesses for appearing and look forward to their testimony on the challenges 

NASA faces in controlling program cost and schedule. 

### 
8 

Chairman BABIN. So now, I’d like to recognize the Ranking Member of the Subcommittee from California, Mr. Bera. 

Mr. BERA. Thank you, Mr. Chairman. Thank you for having this 

timely hearing, and welcome to the witnesses. I do look forward to 

your testimony. 

When you think about NASA, NASA is a unique agency. It’s a 

source of national pride for us, but it also is a cutting-edge agency 

that serves to inspire. Those of us who grew up during the space 

race certainly understood that inspiration and it motivated many 

of us to go into the sciences. 

I want to also acknowledge it’s not that often we walk into a 

hearing room and we see a line of folks waiting to get in here, and 

I think we’re joined by NASA’s interns and that next generation 

that hopefully is going to inspire, discover, and move us forward. 

So, thank you to the interns that are here. You are the future. 

In terms of thinking about Congress’ role here, we clearly have 

a role, a fiscal responsibility and oversight, and those at NASA 

don’t have an easy job. I mean, you are trying to think about what 

that future looks like. You are trying to put those projects together 

and I appreciate that check and balance. As you’re doing things 

that we’ve never done before, you often encounter the unexpected. 

And I think that’s why this is an important hearing. 

Resolving cost and scheduling issues are hard, and there really 

is no simple fix for these types of situations. That said I have no 

doubt that NASA’s talented workforce is looking to find those improvements of how it conducts project management, oversees its 

contractors, collaborates with international partners, provides 

greater funding certainty, and applies cost estimation tools and 

techniques. 

But today’s discussion of schedule delays and cost increases and 

the search for corrective actions cannot take away from the accomplishments and discoveries made by programs like Hubble, the 

International Space Station, and Mars Curiosity. These accomplishments and discoveries would not have happened had the nation not 

made the hard decisions that enable these projects to carry through 

in spite of scheduling delays and cost growth. 

And we’ve been well-rewarded with countless innovations thanks 

to the dedicated and inspired work by NASA, its supporting contractors, and the nation’s colleges and universities. One area for 

improvement is a better agreement on the baseline from which cost 

growth and schedule delay are determined. 

The inconsistent measurement of cost growth across programs 

was noted in the National Academies’ review of NASA Earth 

Science and Space Missions in 2010. For example, some people 

characterize the cost growth of the Webb Space Telescope using an 

initial baseline project cost of $1 billion to $3.5 billion. While this 

was the initial range cost estimated in 1996, that estimate was not 

based on a detailed analysis. A detailed analysis is needed to establish a baseline from which NASA makes a commitment to Congress 

that it can design, develop, and build a project at the cost specified. 

The initial baseline was established in the fiscal year of 2009, and 

according to that baseline, JWST was estimated to have a lifecycle 

cost of about $5 billion. That is a pretty different number than $1 

billion. 
9 

So, in closing, Mr. Chairman, this topic is timely. NASA’s need 

to effectively manage its programs will gain even more importance 

as the agency seeks to manage its wide-ranging portfolio in an increasingly constrained fiscal environment while pursuing ambitious 

goals such as exploring Europa and sending humans far away from 

Earth. 

I look forward to a robust discussion at today’s hearing, and with 

that, I’ll yield back. 

[The prepared statement of Mr. Bera follows:] 
10 

OPENING STATEMENT 

Ranking Member Ami Bera (D-CA) 

of the Subcommittee on Space 

Committee on Science, Space, and Technology 

Subcommittee on Space 

"NASA 's Cost and Schedule Overruns: 

Acquisitions and Program Management Challenges" 

June 14,2018 

Good morning, and thank you, Mr. Chainnan, for holding this hearing on "NASA's Cost and 

Schedule Overruns: Acquisitions and Program Management Challenges". Welcome to our 

witnesses, and I look forward to your testimony. 

One of the most important responsibilities Congress has is to ensure that agencies, such as 

NASA, have the resources and tools necessary to carry out their mission. However, we have the 

added responsibility for making sure that agencies are being good stewards of taxpayer dollars. 

As we will hear today, NASA is encountering schedule delays, and in some cases, cost increases 

in a number of projects and programs. l appreciate the good work by the Government 

Accountability Office and NASA's Inspector General in bringing these cases to our attention as 

we can learn from those cases in order to minimize issues in the future. 

Resolving cost and schedule issues is hard, and there's no simple fix or the situation would have 

been resolved long ago. But I have no doubt that NASA· s talented workforce can find 

improvements in how it conducts program management; oversees its contractors; collaborates 

with its international partners; provides greater funding certainty; and applies cost estimation 

tools and techniques. However, today's discussion of schedule delays and cost increases, and the 

search for corrective actions, cannot take away from the accomplishments and discoveries made 

possible by programs and projects such as Hubble, the International Space Station, and Mars 

Curiosity. These accomplishments and discoveries would not have happened had the Nation not 

made the hard decisions that enabled these projects to carry through, in spite of schedule delays 

and cost growth. And we have been well rewarded with countless innovations. thanks to the 

dedicated and inspired work by NASA, its supporting contractors, and the Nation's colleges and 

universities. 

One area for improvement is a better agreement on the baseline from which cost growth and 

schedule delay are determined. The inconsistent measurement of cost growih across programs 

was noted in a National Academies review of NASA Earth Science and Space Science Missions 

in2010. For example, some people characterize the cost growth of the James Webb Space 

Telescope using an initial baseline project costs of $1 billion to $3.5 billion. While this was the 

initial range of cost estimated in 1996, that estimate was not based on a detailed analysis. A 

detailed analysis is needed to establish a baseline from which NASA makes a commitment to 

Congress that it can design, develop, and build the project at the cost and schedule specified. 

That initial baseline was established in Fiscal Year 2009. According to that baseline, JWST was 

estimated to have a life cycle cost of about $5 billion. That is a far cry from $1 billion. 
11 

In closing. Mr. Chairman, this topic is timely. NASA's need to effectively manage its programs 

will gain even more importance as the agency seeks to manage its wide-ranging portfolio in an 

increasingly constrained fiscal environment while pursuing ambitious goals, such as exploring 

Europa and sending humans far away from Earth. 

I look forward to a robust discussion at today's hearing. With that, I yield back. 
12 

Chairman BABIN. Thank you very much. 

And now I’d like to—in fact, before I recognize our next speaker, 

I also want to reiterate—thank you for saying this, Congressman 

Bera. I met some of you outside in the hall when I walked up, and 

I wanted to tell you that we’re elated that we’ve have got all of 

these NASA interns in here, and we really appreciate the good 

work you’re doing and just want to pat you all on the back. You’re 

our future in the space program. Thank you for being here. 

Now, I’d like to introduce our—the Chairman of the full Committee, the gentleman from Texas, Chairman Lamar Smith. 

Chairman SMITH. Thank you, Mr. Chairman. 

This Committee has demonstrated time and again that U.S. leadership in space is a bipartisan priority. Our vote on the 2018 NASA 

Authorization Act in April was a clear demonstration of that. 

Congress and the Administration support a consistent, focused 

space program, and the current NASA budget demonstrates that 

resolve. NASA once again received one of the most favorable authorizations and appropriations of any agency. 

Healthy budgets are a good start, but they must be followed up 

with solid management and oversight to make certain taxpayers’ 

funds are spent well. However, excessive costs and missed deadlines may undermine the very NASA projects Congress and the 

American people support. 

We recently held hearings discussing four of NASA’s highest profile programs: SLS, Orion, Commercial Crew, and the James Webb 

Space Telescope. The Subcommittee will have a hearing next 

month about the JWST program breach, and Northrop Grumman’s 

CEO has agreed to testify. 

The GAO’s report identified significant cost and deadline problems with all four of these high-interest programs. SLS and JWST 

are identified as having deteriorating cost and schedule performance due to risky decisions involving technology. GAO found that 

the commercial crew contractors continue to have significant delays 

in the test flight schedules. And NASA expects the Orion program 

to exceed its cost baseline. 

GAO assessed other NASA major projects this year as well. For 

example, the Wide Field Infrared Survey Telescope remains a serious concern for Congress. This Committee has requested but not 

received the WFIRST lifecycle cost estimate that was required by 

the fiscal year 2018 omnibus. 

Congress has a responsibility to authorize and appropriate funding necessary to accomplish the tasks it directs NASA to carry out. 

But Congress also has a responsibility to not let cost overruns detract from other NASA priorities, such as research and small- and 

medium-class missions. 

It is time for NASA’s contractors to deliver. The 2018 NASA Authorization Act takes important steps to impose a contractor responsibility watchlist. This watchlist would penalize poor performing contractors by restricting them from competing for further 

NASA work. 

Beyond contractor watchlists, NASA should continue to explore 

additional options to reduce the costs of these large programs, such 

as leveraging program surpluses, early-stage cost caps, firm fixedprice contracts, and public-private partnerships that benefit tax-
13 

payers. Anything short of that will undermine Congressional confidence in the contractors’ ability to deliver on their promises at a 

reasonable cost. 

If space exploration is going to continue to earn the public’s 

trust, then contractors will have to deliver on time and on budget. 

If they cannot, then they should face sanctions. 

Mr. Chairman, again, I look forward to our witnesses’ testimony 

today and yield back the balance of my time. 

[The prepared statement of Chairman Smith follows:] 
14 

COMMITTEE ON 

SCIENCE, SPACE, & TECHNOLOGY Lamar Smith, Chairman 

For Immediate Release 

June 14.2018 

Media Contacts: Thea McDonald. Bridget Dunn 

(202) 225-6371 

Statement by Chairman Lamar Smith (R-Texas) 

NASA Cost and Schedule Overruns: Acquisition and Program Management Challenges 

Chairman Smith: This committee has demonstrated time and again that U.S. leadership in 

space is a bipartisan priority. Our vote on the 2018 NASA Authorization Act in April was a 

clear demonstration of that. 

Congress and the administration support a consistent. focused space program. and the 

current NASA budget demonstrates that resolve. NASA once again received one of the most 

favorable authorizations and appropriations of any agency. 

Healthy budgets are a good start. but they must be followed up with solid management and 

oversight to make certain taxpayers' funds are spent well. However. excessive costs and 

missed deadlines may undermine the very NASA projects Congress and the American 

people support. 

We recently held hearings discussing four of NASA's highest profile programs: SLS, Orion. 

Commercial Crew and the James Webb Space Telescope (JWST). The subcommittee will 

have a hearing next month about the JWST program breach, and Northrop Grumman's 

CEO. Wes Bush. has agreed to testify. 

The Government Accountability Office's (GAO) report identified significant cost and 

deadline problems with all four of these high-interest programs. SLS and JWST are identified 

as having deteriorating cost and schedule performance due to risky decisions involving 

technology. 

GAO found the commercial crew contractors continue to have significant delays in the test 

flight schedules. And, NASA expects the Orion program to exceed its cost baseline. 

GAO assessed other NASA major projects this year as well. For example. the Wide Field 

Infrared Survey Telescope (WFIRST) remains a serious concern for Congress. This committee 

has requested but not received the WFIRST life cycle cost estimate that was required by the 

FY18 Omnibus. 

Congress has a responsibility to authorize and appropriate funding necessary to accomplish 

the tasks it directs NASA to carry out. But Congress also has a responsibility to not let cost 

overruns detract from other NASA priorities. such as research and small-and medium-class 

missions. 
15 

It is time for NASA's contractors to deliver. The 2018 NASA Authorization Act takes important 

steps to impose a contractor responsibility watch list. This watch list would penalize poor 

performing contractors by restricting them from competing for further NASA work. 

Beyond contractor watch lists, NASA should continue to explore additional options to reduce 

the costs of these large programs, such as leveraging program surpluses, early-stage costcaps, firm fixed-price contracts and public-private partnerships that benefit taxpayers. 

Anything short of that will undermine congressional confidence in the contractors' ability to 

deliver on their promises at a reasonable cost. If space exploration is going to continue to 

earn the public's trust, then contractors will have to deliver on time and on budget. If they 

cannot. then they could face suspension and debarment. 

I look forward to our witnesses' testimony today. Thank you, Mr. Chairman. 

### 
16 

Chairman BABIN. Thank you very much. 

Now, I’d like to introduce the gentlewoman from Texas, the 

Ranking Member of the full Committee, Ms. Johnson. 

Ms. JOHNSON. Thank you very much, Mr. Chairman, and thank 

you for holding this hearing and thanks to our witnesses for being 

here. 

This morning, we hope we’re going to get a status update on 

NASA’s management and its programs, particularly cost and schedule status on its large missions. To that end, I hope the hearing 

will provide answers to some of our key questions. Is NASA’s ability to manage cost and schedule on its programs improving or is 

it getting worse, as the Government Accountability Office seems to 

indicate in its recent report on NASA’s major projects? 

If it is getting worse, what should be done, particularly by this 

Committee? Cost and schedule can be expected to be difficult on 

projects that push the state-of-the-art in science and engineering. 

Challenging missions and transformational science are what we expect of space programs worthy of this great nation. 

That said, Mr. Chairman, we can do better. In particular, we 

need to improve our ability to identify early on when we can still 

make design decisions whether a project runs the risk of exceeding 

budget constraints and, if so, what options we have at our disposal 

to make sure the program meets those budget constraints. 

The Wide Field Infrared Survey Telescope is a good example. 

After stakeholders, including the National Academies, expressed 

concerns that the WFIRST could run into potential cost and schedule growth, NASA established expert groups to rigorously review 

the cost, engineering, and science objectives for the mission. I commend NASA for taking this action. These steps are being taken before a final WFIRST mission design is established and while there 

is still time to reconsider the scope and approach of the mission to 

preclude the possibility of exceeding costs, schedule expectations as 

it starts its development. 

Mr. Chairman, I look forward to discussing learning opportunities such as this one in determining whether future NASA missions 

would benefit from incorporating similar processes to minimize the 

possibility of future schedule delay and/or cost increases. 

One thing I learned early on while serving on this Committee is 

that NASA is a unique engine of innovation, a force for pushing 

new advances in space technology and operations. That is why I’m 

anxious to hear from our witnesses on whether the costs and schedule models that are based on the past, traditional approaches to 

national project development are being updated to reflect the 

changes in today’s manufacturing, operations, and technology environment. Is R&D on cost and schedule models needed? Are there 

other tools that could help NASA improve the management of cost 

and schedule in its acquisition of space systems? 

We do have a lot to discuss this morning, and I look forward to 

hearing from our witnesses. Thank you, and I yield back. 

[The prepared statement of Ms. Johnson follows:] 
17 

OPENING STATEMENT 

Ranking Member Eddie Bernice Johnson (D-TX) 

Committee on Science, Space, and Technology 

Subcommittee on Space 

"NASA's Cost and Schedule Overruns: 

Acquisitions and Program Management Challenges" 

June 14,2018 

Good morning, Mr. Chairman, and thank you for holding this hearing on ''NASA's Cost and 

Schedule Overruns: Acquisitions and Program Management Challenges." I'd like to welcome 

our witnesses, and !look forward to your testimony. This morning, we are going get a status 

update on NASA's management of its programs, particularly cost and schedule status on its large 

missions. To that end, I hope the hearing will provide answers to some key questions. Is 

NASA's ability to manage cost and schedule on its programs improving, or is it getting worse as 

the Government Accountability Office seems to indicate in its recent report on NASA's major 

projects? If it is getting worse, what should be done, particularly by this Committee? 

Cost and schedule can be expected to be difficult on projects that push the state-of-the-art in 

science and engineering. Challenging missions and transfonnational science are what we expect 

of a space program worthy of a great nation. That said, Mr. Chairman, we can do better. In 

particular, we need to improve our ability to identify early on--when we can still make design 

decisions--whether a project runs the risk of exceeding budget constraints and, if so, what 

options we have at our disposal to make sure the program meets those budget constraints. 

The Wide-Field Infrared Survey Telescope (WFIRST) is a good example. After stakeholders. 

including the National Academies, expressed concerns that WFIRST could run into potential 

cost and schedule growth, NASA established expert groups to rigorously review the cost, 

engineering, and science objectives for the mission. I commend NASA for taking this action. 

These steps are being taken before a final WFIRST mission design is established and while there 

is still time to reconsider the scope and approach for the mission to preclude the possibility of 

exceeding cost and schedule expectations as it starts development. 

Mr. Chairman, I look forward to discussing learning opportunities such as this one and 

determining whether future NASA missions would benefit from incorporating similar processes 

to minimize the possibility of future schedule delay and/or cost increases. One thing !learned 

early on while serving on this Committee is that NASA is a unique engine of innovation. a force 

for pushing new advances in space technology and operations. That is why I am anxious to hear 

from our witnesses on whether cost and schedule models that were based on past, traditional 

approaches to NASA's project development are being updated to reflect the changes in today's 

manufacturing, operations, and technology environment. Is R&D on cost and schedule models 

needed? Are there other tools that could help NASA improve the management of cost and 

schedule in its acquisition of space systems? 
18 

Well, we have a lot to discuss this morning, and I look forward to a good discussion at today's 

hearing. 

Thank you and I yield back. 
19 

Chairman BABIN. Thank you very much. 

Now, I’d like to introduce our witnesses. Our first witness today 

is Ms. Cristina Chaplain, Director of Contracting and National Security Acquisitions at the U.S. Government Accountability Office. 

Among other topics, Ms. Chaplain has led reviews on the ISS, the 

SLS, and Orion crew capsule, as well as commercial cargo and crew 

projects at NASA. 

Ms. Chaplain received her bachelor’s degree in international relations from Boston University and a master’s degree in journalism 

from Columbia University. We welcome you. 

Our second witness today is Mr. Stephen Jurczyk, serving as the 

Associate Administrator of NASA, the agency’s highest-ranking career civil service position. Prior to this appointment, Mr. Jurczyk 

served as Associate Administrator of the Space Technology Mission 

Directorate where he formulated and executed the agency’s space 

technology programs. 

Mr. Jurczyk is a graduate of the University of Virginia where he 

received a Bachelor of Science and a Master of Science in electrical 

engineering. Thank you for being here. 

Our third witness today is Hon. Paul Martin, Inspector General 

of NASA. Prior to this appointment, Mr. Martin served as the Deputy Inspector General of the U.S. Department of Justice in the Office of Inspector General. Mr. Martin holds a Bachelor of Arts in 

journalism from Pennsylvania State University and a Juris Doctor 

from Georgetown University Law Center. Thank you for being 

here. 

Our final witness today is Mr. Daniel Dumbacher, the Executive 

Director of the American Institute of Aeronautics and Astronautics, 

or AIAA. Mr. Dumbacher—is it Bacher or Bacher? 

Mr. DUMBACHER. Bacher. 

Chairman BABIN. Bacher, I thought so. I served three years in 

Germany, so I thought so. Mr. Dumbacher has previously served as 

the Deputy Associate Administrator of the Exploration Systems Development Division of NASA’s Human Exploration and Operations 

Mission Directorate. 

Mr. Dumbacher earned his bachelor’s degree in mechanical engineering from Purdue University and a master’s degree in business 

administration from the University of Alabama in Huntsville. He 

has also completed the Senior Managers in Government program 

at Harvard University. 

So I’d like to recognize Ms. Chaplain for five minutes to present 

her testimony. 

TESTIMONY OF MS. CRISTINA CHAPLAIN, DIRECTOR, 

GAO: CONTRACTING AND 

NATIONAL SECURITY ACQUISITIONS 

Ms. CHAPLAIN. Chairman Babin and Ranking Member Bera, 

Chairman Smith and Ranking Member Johnson, thank you for inviting me today to discuss the cost and schedule performance of 

NASA’s largest projects. 

Since we began our assessments of major projects ten years ago, 

we have seen NASA make progress in reducing acquisition risk, 

but our most recent review found that performance has worsened 

after several years of following a general positive trend. 
20 

[Slide.] 

Ms. CHAPLAIN. Specifically, as shown in this graph, the average 

launch delay, which is the yellow line with dots, increased from 7 

months in our 2017 report to 12 months in this year’s report. This 

was the first year we could not determine the extent of cost growth 

because NASA does not have a current estimate for the Orion program. Orion accounts for 22 percent of about $30 billion of development costs for major projects. 

Even without including Orion, however, the overall development 

cost growth increased to 18.8 percent, up from 15.6 percent in 

2017. We expect this number to increase further once Orion is 

factored in and probably even more as large projects, including 

James Webb, Space Launch System, and Exploration Ground Systems are in their riskiest phases of development. 

In regard to this graph, I’d also like to point out that when we 

started our assessments in 2009, cost and schedule growth was 

more problematic than depicted. Many baselines had been set just 

a couple years prior in response to a statutory requirement aimed 

at enabling more consistent reporting from NASA. So, as you can 

see, it’s been a struggle for Congress to hold them accountable for 

years. Also in 2012, you can see the impact that James Webb had 

on the overall cost growth when its estimate increased from 4.9 billion to $8.8 billion. 

[Slide.] 

Ms. CHAPLAIN. This next graph depicts some of the reasons why 

projects experience cost and schedule growth. They’re not so different than what we’ve seen in the past at NASA and across government space programs. Cost and schedule growth is sometimes 

due to issues beyond a project’s control—the light blue circles— 

which might include a delivery—a late delivery and a delay of the 

launch vehicle. 

In other times the dark blue circles, it was due to risky management decisions. For instance, human spaceflight programs have 

been operating with very low cost and schedule reserves, which has 

limited their ability to address unforeseen technical challenges. In 

other cases, projects encounter technical problems that can sometimes be avoided and sometimes not. The James Webb program is 

reporting delays, for example, due to workmanship errors that delayed the delivery of the spacecraft propulsion system and also because of unanticipated complexities involved with unfurling the 

sunshield, which is unique to the telescope. We’re looking at whether more could have been done to avoid the workmanship issues. 

Since the mid-2000s, NASA has made strides in developing tools 

and approaches to reduce costs and schedule growth. 

[Slide.] 

Ms. CHAPLAIN. As shown in this graph, for example, projects are 

increasingly building more knowledge about critical technologies 

early so that they do not discover problems when they’re more expensive and time-consuming to fix. Similarly, they’re building more 

knowledge about design before proceeding into integration. NASA 

has also improved cost and schedule estimating processes and its 

oversight processes. 

While we recognize NASA’s progress, we believe more can be 

done to put programs on a sounder footing. For example, as men-
21 

tioned earlier, the human spaceflight projects should not be operating with low cost and schedule reserves. Projects should also regularly update cost and schedule estimates, but they are more often 

reluctant to do so. For James Webb, an updated estimate may have 

forecasted the current schedule delays if it were done a few years 

ago. 

We also still find that some projects do not manage contractors 

well and react only after problems become overwhelming. This 

year, we saw that workmanship errors on even the smallest of components can sometimes have dramatic impacts. 

Lastly, NASA should take steps needed to ensure cost growth 

from a large project does not overwhelm a portfolio. NASA did this 

recently for its astrophysics portfolio when it undertook an independent review of the WFIRST telescope before the more costly 

phases of the acquisition process began. This type of assessment 

should continue. 

In conclusion, we recognize NASA projects are complex, they face 

inherent technical challenges. Some cost and schedule growth is inevitable when you push the state of technology, but more can be 

done to limit management risks that often exasperates problems. 

Chairman Babin, Ranking Member Bera, this concludes my 

statement, and I’m happy to answer any questions you have. 

[The prepared statement of Ms. Chaplain follows:] 
22 

For Release on Delivery 

Expected at 10:00 a.m. ET 

Thursday, June 14, 2018 

GA0-18-576T 

United States Government Accountability Office 

Testimony 

Before the Subcommittee on Space, 

Committee on Science, Space, and 

Technology, House of Representatives 

NASA MAJOR 

PROJECTS 

Portfolio Is at Risk for 

Continued Cost Growth 

and Schedule Delays 

Statement of Cristina T. Chaplain, Director, 

Contracting and National Security Acquisitions 
23 

Why GAO Did This Study 

NASA's acquisition 

high~risk area in 

history of persistent cost 

growth and schedule slippage in many 

of NASA's major projects. In more 

recent years, GAO found that NASA 

had taken some steps to improve its 

management, and, in May 2017. GAO 

found that projects were continuing a generally positive trend of limiting cost 

and schedule growth. But at the same 

time, GAO noted that many of these 

projects~ including some of the most 

expensive ones, were approaching i:he 

phase in their life cycles when cost and 

schedule growth is most likely. 

What GAO Recommends 

GAO is not making any new 

recommendations ln this statement 

GAO has made recommendations in 

to strengthen NASA's 

management of its major 

NASA generally agreed with 

recommendations, but has not 

fully addressed some of them. GAO 

continues to believe they should be 

fully addressed. 

NASA MAJOR PROJECTS 

Portfolio Is at Risk for Continued Cost Growth and 

Schedule Delays 

What GAO Found 

The cost and schedule performance of the National Aeronautics and Space 

Administration's (NASA) portfolio of major projects has deteriorated, but the 

extent of cost performance deterioration is unknown. NASA expects cost growth 

for the Orion crew capsule-one of the largest projects in the portfolio-but does 

not have a current cost estimate. In addition, the average launch delay for the 

portfolio was 12 months, the highest delay GAO has reported in its 10 years of 

assessing major NASA projects (see figure below). 

NASA's Major Project Portfolio Cost and Schedule Performance Deteriorated in 2018 Percentage cost growth Average launch delay (m months) 

~ u 

45 

40 

35 

30 

25 

20 

15 

10 

2009 2010 2011 2012 2013 2014 2015 2016 2{117 2018 

Source GAO armlysJS of NatfOmlAeromluhcs and SpaceAdrninJstration {NASA) data 1 GA0"18-575T 

11 

10 

The deterioration in portfolio performance was the result of 9 of the 17 projects in 

development experiencing cost or schedule growth. 

• Four projects encountered technical issues that were compounded by risky 

program management decisions. For example, the Space Launch System and 

Exploration Ground Systems programs are !arge~sca!e, technically complex 

human spaceflight programs, and NASA managed them to aggressive 

schedules and with insufficient levels of cost and schedule reserves, This 

made it more difficult for the programs to operate within their committed 

baseline cost and schedule estimates. 

• Two projects ran into technical challenges that resulted in delays in the 

integration and test phase. For example, in December 2017, GAO found that 

the James Webb Space Telescope project encountered delays primarily due 

to the integration of the various spacecraft elements taking longer than 

expected, as well as the need to resolve technical issues during testing. GAO 

has previously found that integration and testing is when projects are most at 

risk of incurring cost and schedule growth. 

• Three projects experienced cost growth or schedule delays due to factors 

outside of the projects' control, such as delays related to their launch vehicles. 

NASA continues to face increased risk of cost and schedule growth in future 

years due to new, large and complex projects that will enter the portfolio and 

expensive projects remaining in the portfolio longer than expected. 

-------------Unfted States Government Accountability Office 
24 

Chairman Babin, Ranking Member Bera, and Members of the 

Subcommittee: 

Thank you for inviting me to discuss the cost and schedule performance 

of the National Aeronautics and Space Administration's (NASA) portfolio 

of major acquisition projects. NASA's major projects are the key enablers 

for the agency to achieve its vision and its mission. They include NASA's 

Space Launch System (SLS) and Orion Multi-Purpose Crew Vehicle 

(Orion), which are the centerpieces of NASA's human exploration plans; 

Mars 2020 and Europa Clipper, which will further our understanding of the 

habitability of other planets; and the Ice, Cloud, and Land Elevation 

Satellite-2 (ICESat-2), which will provide better data on changes in the 

Earth. In its fiscal year 2019 budget request, NASA requested $19.9 

billion, which included about $4.5 billion for its deep space exploration 

programs and research and about $6 billion for science programs and 

research. As these projects are complex and specialized, and often push 

the state of the art in space technology, NASA manages a portfolio that 

will always have inherent technical, design, and integration risks. 

We have been assessing the cost and schedule performance of NASA's 

major projects-those that have a life-cycle cost over $250 millionannually for 10 years. Over this time, we have seen NASA make progress 

in reducing acquisition risks, such as by improving cost and schedule 

estimating tools, and establishing design metrics and tracking projects 

against the metrics. But our most recent assessment in May 2018 found 

that the cost and schedule performance of the portfolio deteriorated after 

several years of following a generally positive trend of limiting cost and 

schedule growth.' 

My statement today is based primarily upon our May 2018 report. 

Specifically, I will discuss (1) the cost and schedule performance of 

NASA's portfolio of major projects and (2) the extent to which NASA faces 

risks for continued cost increases and schedule delays. To conduct this 

work, we collected cost and schedule information from NASA's major 

projects using a data collection instrument, analyzed projects' monthly 

status reports, interviewed NASA project and headquarters officials, and 

reviewed project documentation. At the time of our review, there were 26 

major projects in total, but the information available depended on where a 

1GAO, NASA: Assessments of Major Projects, GA0-18-280SP (Washington, O.C : May 1, 

2018). 

Page 1 GA0·18·576T 
25 

Background 

NASAAcquisition Life 

Cycle for Space Flight 

Projects 

project was in its life cycle. 2 For the 17 projects that were in the 

implementation phase, we compared current cost and schedule estimates 

to their original cost and schedule baselines. We reviewed historical data 

on cost and schedule performance for major projects from our prior 

reports and compared them to the performance of NASA's current 

portfolio of major projects. More detailed information on our objectives, 

scope, and methodology for that work can be found in our May 2018 

report. In addition, we requested and received an update from NASA in 

early June 2018 on whether the agency had completed a new life-cycle 

cost estimate for the Orion program. We also updated the actual launch 

date for the Gravity Recovery and Climate Experiment Follow-On 

(GRACE-FO) project and updated information on the launch date for the 

Ionospheric Connection Explorer (ICON) project. 

We conducted the work on which this statement is based in accordance 

with generally accepted government auditing standards. Those standards 

require that we plan and perform the audit to obtain sufficient, appropriate 

evidence to provide a reasonable basis for our findings and conclusions 

based on our audit objectives. We believe that the evidence obtained 

provides a reasonable basis for our findings and conclusions based on 

our audit objectives. 

The life cycle for NASA space flight projects consists of two phasesformulation, which takes a project from concept to preliminary design, and 

implementation, which includes building, launching, and operating the 

system, among other activities. NASA further divides formulation and 

implementation into phases, phase A through phase F. Major projects 

must get approval from senior NASA officials at key decision points 

before they can enter each new phase. Formulation culminates in a 

review at key decision point C, known as project confirmation, where cost 

and schedule baselines are established and documented in a decision 

memorandum. Figure 1 depicts NASA's life cycle for space flight projects. 

2Eight projects were in an early stage of development, called formulation, when there are 

still unknowns about requirements, technology, and design. For those projects, we 

reported preliminary cost ranges and schedule estimates_ The Commercia! Crew Program 

has a tailored project life cycle and project management requirements. As a result, it was 

excluded from our cost and schedule performance analysis. 

Page 2 GA0-18-576T 
26 

Figure 1: NASA's Life Cycle for Space Flight Projects 

Management d(!cis!on reviews 

KDP ::: key dec:sion po1nt 

Technlea! reviews 

PDR "' preliminary design rev~ew 

CDR "' cntiCal des1gn review 

SIR = system mtegrat1on review 

Source GAO arw.!ys;s of NatlonaiAarorrauttcs aM SpaceAd'llimstmtion (NASA) data 1 GAQ.18·576T 

At the time of our review in May 2018, NASA had a portfolio of 26 major 

projects (see table 1). See appendix I for a brief description of each 

project. 

Page 3 GA0·18·576T 
27 

NASA Acquisition 

Management as a HighRisk Area 

Table 1: Major NASA Projects Reviewed in GAO's 2018 Assessment by Phase 

Projects in formulation Double Asteroid Redirection Test (DART) 

Europa Clipper 

Projects in 

implementation 

Low Boom Flight Demonstrator (LBFO) 

Lucy 

Plankton, Aerosol, Cloud, ocean Ecosystem (PACE) 

Psyche 

Restore-L 

Wide-Field Infrared Survey Telescope (WFIRST) 

Commercial Crew Program (CCP) 

Exploration Ground Systems (EGS) 

Gravity Recovery and Climate Experiment Follow-On 

(GRACE-FO) 

Ice, Cloud, and Land Elevation Satellite-2 (ICESat-2) 

Interior Exploration using Seismic Investigations, Geodesy, 

and Heat Transport (InSight) 

Ionospheric Connection Explorer (ICON) 

James Webb Space Telescope (JWST) 

Landsat 9 (L9) 

Laser Communications Relay Demonstration (LCRD) 

Mars 2020 

NASA ISRO Synthetic Aperture Radar (NISAR) 

Orion Multi-Purpose Crew Vehicle (Orion) 

Parker Solar Probe (PSP) (formerly Solar Probe Plus) 

Radiation Budget Instrument (RBI) 

Space Launch System (SLS) 

Space Network Ground Segment Sustainment (SGSS) 

Surface Water and Ocean Topography (SWOT) 

Transiting Exoplanet Sutvey Satellite (TESS) 

Source GAO analysts o1 Nat1ona1 AeronautiCS and Space Adm1n1strat10n (NASA) data 1 GA0-18-576T 

NASA acquisition management is an area that we monitor on our highrisk list. 3 Our high-risk series is a biennial report that keeps focused 

attention on government operations with greater vulnerabilities to fraud, 

waste, abuse, and mismanagement or that are in need of transformation 

3

GAO, High-Risk Series: Progress on Many High-Risk Areas, White Substantial Efforts 

Needed on Others, GA0-17-317 (Washington, D.C .. Feb. 15, 2017). We first designated 

NASA contract management as a high-risk area in 1990. In 2009, we updated the title of 

the area to NASA acquisition management because of the scope of issues that needed to 

be resolved to address persistent cost growth and schedule delays. 

Page4 GA0-18-576T 
28 

to address economy, efficiency, or effectiveness challenges. In 1990, we 

first designated the area as high risk because there was little emphasis 

on end results, product performance, and cost control; the acquisition 

process itself was cumbersome and time-consuming; and NASA found 

itself procuring expensive hardware that did not work properly. For 

example, in April1990, NASA deployed the $1.5 billion Hubble Space 

Telescope and soon after, the agency discovered that the primary mirror 

had been manufactured in the wrong shape, severely degrading some of 

the telescope's scientific capabilities. 

Subsequently, we and other organizations, including the National 

Academy of Sciences and NASA's Office of the Inspector General, found 

that NASA's cost estimates were overly optimistic4 Our reviews also 

found that NASA continued to experience significant cost and schedule 

growth due, in part, to not having a disciplined cost estimating process. 

In 1992, we reviewed the cost and schedule performance of 29 NASA 

programs and found that 25 of those programs experienced cost 

growth that ranged from 14 to 426 percent above their initial 

estimates. 5 Further, the median estimate change for all programs was 

an increase of 77 percent. General reasons that NASA provided for 

the cost growth included insufficient definition studies, program and 

funding instability, overly optimistic assumptions by program officials, 

and unrealistic contractor estimates. The more specific reasons for 

the cost growth we found included program redesigns, technical 

complexities, budget constraints, and incomplete cost estimates. 

In 2004, we reviewed the cost and schedule performance of 27 NASA 

programs and found that 17 of the programs experienced cost 

growth. 6 Cost growth for 10 of the 17 programs was over 25 percent. 

4GAO, Space Programs: NASA's fndependent Cost Estimating Capability Needs 

Improvement, GAO/NSIA0-93-73 {Washington, D.C .. Nov. 5, 1992); NASA Program 

Costs: Space Missions Require Substantially more Funding Than Initially Estimated, 

GAO/NSIAD-93-97 (Washington, D.C.: Dec. 31, 1992); National Research Council of the 

National Academies, Controlling Cost Growth of NASA Earth and Space Science Missions 

(Washington, D.C.: National Academies Press, 2010); and NASA Office of Inspector 

General, Inspector General Assessment of NASA's Most Sen'ous Management and 

Performance Challenges, (Washington, D.C.: Feb. 4, 2002) and NASA's Independent 

Cost Estimating Capability, IG-00-045 (Washington, D.C.: Sept 20, 2000) 

5GAOINSIAD-93-97. 

6GAO, NASA: Lack of Disciplined Cost~Estimating Processes Hinders Effective Program 

Management, GA0-04-642 (Washington. D.C .. May 28. 2004) 

PageS GA0-18~576T 
29 

We found that considerable change in NASA's program cost 

estimates-both increases and decreases-indicated that NASA 

lacked a clear understanding of how much its programs cost and how 

long they will take to achieve their objectives. Further, we found that 

NASA's basic cost-estimating processes-an important tool for 

managing programs-lacked the discipline needed to ensure that 

program estimates are reasonable. 

In more recent years we have found that NASA's leadership was focused 

on improving acquisition outcomes and had taken some steps to improve 

its management. 

In 2006, NASA established a management review process to enable 

NASA's senior management to more effectively monitor a project's 

performance, including cost, schedule, and cross-cutting technical 

and nontechnical issues. 

In 2009, NASA began requiring that NASA major programs and 

projects develop a joint cost and schedule confidence level (JCL) prior 

to project confirmation in order to ensure that cost and schedule 

estimates were realistic and projects thoroughly planned for 

anticipated risks. The JCL is a point-in-time estimate that. among 

other things, includes all cost and schedule elements, incorporates 

and quantifies known risks, assesses the impacts of cost and 

schedule to date, and addresses available annual resources. NASA 

policy generally requires that projects be baselined and budgeted at 

the 70 percent confidence level. 

In 2012, the agency established metrics to more consistently measure 

a project's design progress and, in 2014, we found that most major 

projects in the portfolio were tracking and reporting those metrics. In 

addition, experts with whom we met confirmed that NASA's metrics 

are valid measures to assess design maturity in space systems. 

Since 2015, we have observed a positive trend of higher numbers of 

projects maturing technologies prior to preliminary design review. 7 

Demonstrating that technologies will work as intended in a relevant 

environment serves as a fundamental element of a sound business 

case, and projects falling short of this standard often experience 

subsequent technical problems. Our best practices work has shown 

7 A technology is considered mature when it reaches a technology readiness level 6, which 

is achieved after demonstrating a representative prototype of the technology in a relevant 

environment that simulates the harsh conditions of space. 

PageS GA0-18-576T 
30 

that maturing technologies prior to preliminary design review can 

minimize risks for projects entering development, which lowers the 

risk of subsequent cost growth and schedule delays. 

We believe that many of these steps NASA has taken contributed to the 

largely positive trend of cost and schedule performance for NASA's 

portfolio of major projects between 2013 and 2017. In our May 2017 

assessment of major projects, we found that out of 16 projects in 

development, 5 experienced cost growth and 4 experienced schedule 

delays over their development cost and schedule baselines. 8 Both of 

these measures were at or near the lowest levels we have reported since 

we began our annual assessments in 2009. 

However, we also found in our February 2017 high risk update that NASA 

needed to do more with respect to anticipating and mitigating risksespecially with regard to large programs, estimating and forecasting costs 

for its largest projects, and implementing management tools. 9 We 

highlighted several actions that would be critical to improving NASA's 

acquisition outcomes, including the following: 

Ensuring that NASA conducted adequate and ongoing assessments 

of risks for larger programs because the impacts of any potential 

miscalculations will be felt across NASA's portfolio. 

Ensuring that NASA understood long-term human exploration 

program costs. While the three major human exploration programsOrion, SLS, and the Exploration Ground Systems (EGS)-have been 

baselined, none of the three programs has a baseline that covers 

activities beyond the second planned flight. Long-term estimates, 

which could be revised as potential mission paths are narrowed and 

selected, would provide decision makers with a more informed 

understanding of costs and schedules associated with potential 

agency development paths. 

Ensuring that program offices regularly and consistently updated their 

JCL across the portfolio. As a project reaches the later stages of 

development, especially integration and testing, its risk posture may 

change. An updated project JCL would provide both project and 

8

GAO, NASA: Assessments of Major Projects. GA0-17-303SP (Washington. D.C May 

16, 2017). 

9GA0-17-317. 

Page 7 
31 

Portfolio Cost and 

Schedule 

Deteriorated but 

Extent of Cost Growth 

Is Unknown 

agency management with data on relevant risks that can guide project 

decisions. 

Ensuring that NASA continued its efforts to build capacity in areas 

such as cost and schedule estimating and measuring contractor 

performance. 

Further, in our 2016 and 2017 assessments of major projects, we found 

that while the cost and schedule performance of NASA's portfolio was 

improving, a number of large, complex projects were in or would soon be 

entering the integration and test phase-the phase in development that 

often reveals unforeseen challenges that can lead to cost and schedule 

growth. 10 In May 2017, projects in this phase included all three human 

spaceflight programs and the James Webb Space Telescope (JWST). 11 

Subsequently, we found that these programs experienced delays during 

this phase of development. For example, in December 2017, NASA 

announced a 13- to 19-month delay for the first integrated mission of 

Orion, SLS, and EGS. This mission is referred to as Exploration Mission 1 

(EM-1) and will not have crew. In addition, in December 2017, we found 

that the JWST project continued to make progress towards launch, but 

the program was encountering technical challenges that required both 

time and money to fix and may lead to additional delays." Subsequently, 

the JWST project delayed its launch readiness date by at least 19 months 

from October 2018 to May 2020. 

The cost and schedule performance of NASA's portfolio of major projects 

deteriorated between May 2017 and May 2018, but the extent of cost 

growth is unknown. NASA lacks a current cost estimate for its Orion crew 

capsule-one of the largest programs in the portfolio-but expects the 

program will exceed its cost baseline when NASA updates the program's 

life-cycle cost estimate. Because the Orion program accounts for about 

22 percent of all development costs, even a small percentage of cost 

growth for the Orion program could significantly affect portfolio cost 

performance. The known negative cost and schedule performance is 

10GAO, NASA. Assessments of Major Projects, GA0-16-309SP (Washington, D.C.· Mar. 

30, 2016); and GA0-17-303SP. 

11GA0-17-303SP. 

12GAO, NASA: Preliminary Observations on the Management of Space Telescopes, 

GA0-18-277T (Washington, D.C .. Dec. 6, 2017). 

PageS GA0-18-576T 
32 

Portfolio Average Launch 

Delays Increased, but 

NASA Lacks a Current 

Orion Program Cost 

Estimate to Determine 

Extent of Cost Growth 

largely driven by the cost and schedule growth of four projects-SLS, 

EGS, Space Network Ground Segment Sustainment (SGSS) and Mars 

2020-that experienced technical problems compounded by 

programmatic challenges. Together, these projects experienced $638 

million in cost growth and 59 months in aggregate schedule delays. Two 

projects-JWST and ICESat-2-experienced schedule delays due to 

technical challenges identified during integration and test. Another 3 

projects-NASA Indian Space Research Organisation Synthetic Aperture 

Radar (NISAR), ICON, and GRACE-FO-experienced cost growth or 

delays largely due to factors outside of the projects' control, such as 

launch vehicle delays. 

The average launch delay increased from 7 months in our May 2017 

report to 12 months in our May 2018 report-the highest schedule delay 

we have reported to date. 13 We were not able to determine the extent of 

portfolio cost growth this year because NASA does not have a current 

cost estimate for the Orion program-one of the largest programs in its 

portfolio-and officials expect the cost to increase. As of June 2017, the 

Orion program's development cost was about $6.6 billion; based on that 

estimate, it accounts for 22 percent of the portfolio's estimated $30. 1 

billion of development costs. As a result, a small percentage of cost 

growth for the Orion program could significantly affect cost performance. 

Even without including Orion cost growth, the overall development cost 

growth for the portfolio of 17 development projects increased to 18.8 

percent, up from 15.6 percent in 2017 (see figure 2). 14 

13GA0-17-303SP. 

14We have historically presented cost and schedule performance including and excluding 

the James Webb Space Telescope (JWST} because, prior to 2015, it had a development 

cost baseline significantly larger than other projects and the magnitude of its cost growth 

masked the performance of the remainder of the portfolio. Now that other projects in the 

portfolio, such as Orion and the Space Launch System, have large development cost 

baselines, we no longer present cost performance trends excluding JWST. 

Page 9 GA0~18-576T 
33 

Figure 2: Development Cost Performance and Average Launch Delay for Major 

NASA Projects from 2009 to 2018 

45 

40 

35 

30 

25 

20 

15 

10 

Months 

12 

11 

10 

2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 

.. Percentage cost growth 

Average launch delay 

• Number of projects in development 

Sourte. GAO analysts of Natioflal Aeronaubcs and SPl'lce Admirlislratiorl (NASA) data. I GAO-18-576T 

Note: The years given in the figure refer to the year we issued each of our annual assessments of NASA major projects reports. Cost and schedule performance is compared across each report 

period 

Senior-level NASA officials told us they expect that the Human 

Exploration and Operations Mission Directorate and the Orion program 

will complete an updated life-cycle cost estimate in June 2018. This would 

be approximately 10 months after the program raised to senior-level 

officials' attention that the program expects cost growth over its cost 

baseline during an August 2017 briefing concerning potential cost 

increases related to the launch delay for EM-1. 15 In early June 2018, 

15The Orion program is baselined to the second combined mission of Orion, SLS, and 

EGS. This mission is known as Exploration Mission 2 (EM-2) and wm have crew. 

Page 10 
34 

NASA officials said that they had not yet completed the updated life-cycle 

cost estimate. 

In our May 2018 report, we found that 7 of 17 NASA major projects had 

stayed within cost and schedule estimates since our 2017 annual 

assessment of major projects, but 9 projects experienced cost growth or 

schedule delays and cost growth is expected for the Orion program. 

Table 2 provides data on the cost and schedule performance between our 

May 2017 and 2018 reports for the 17 major projects in development that 

have cost and schedule baselines. 16 

16GA0-17 -303SP. 

Page 11 GA0~18-576T 
35 

Table 2: Development Cost and Schedule Performance of Selected Major NASA Projects in Development as of May 2018 

Assessment 

Overall performance Project Confirmation Changes between Cumulative 

date May 2017 and May 2018 performance 

Year Cost Schedule Cost Schedule 

(millions) (months} (millions} (months} 

Lower than expected cost PSP 2014 $0.0 0 -$5.4 0 

GRACE-FO 2014 -$16 -$2.2 

TESS 2014 -$13.1 -2 -$39.9 -2 

Within baseline ICON 2014 $0.0 $0.0 

SWOT 2016 $0.0 $0.0 

LCRD 2017 $0.0 0 $0.0 

Landsat 9 2017 $0.0 $0.0 

Higher than expected cost Mars 20206 2016 $12.9 $10.7 

NISAR 2016 $22.0 0 $22.0 

Replanc InSight 2014 $0.0 $131.7 26 

EGS (EM-1) 2014 $417.8 19 $421.4 19 

SLS (EM-1) 2014 $147.8 19 $147.8 19 

Rebaselinec JWST 2008 $0.0 19 $3,607.7 71 

ICESat-2 2012 $1.4 $206.3 17 

SGSS 2013 $59.5 21 $421.6 48 

Canceled RBI 2016 $0.0 0 $0.0 0 

Under revision Orion (EM-2) 2015 $0.0 0 -$151.7 0 

Total: $646.7 91 $4,770.0 209 

Legend: PSP: Parker Solar Probe; GRACE-FO: Gravity Recovery and Chmate Experiment Follow-On: TESS: Transiting Exoplanet Survey Satellite; 

ICON. Ionospheric Connection Explorer; SWOT: Surface Water and Ocean Topography; NlSAR: NASA Indian Space Research OrganisationSynthetic Aperture Radar; LCRD: Laser Communications Relay Demonstration; InSight· Interior Exploration using Seismic Investigations, Geodesy. and 

Heat Transport; EGS: Exploration Ground Systems; SLS: Space Launch System: EM-1: Exploration Mission 1; JWST; James Webb Space Telescope: 

ICESat-2: Ice. Cloud, and Land Elevation SateUite-2: SGSS: Space Network Ground Segment Sustainment; RBI: Radiation Budget Instrument; Orion: 

Orion Multi-Purpose Crew Vehicle; EM-2: Exploration Mission 2. 

Source GAO analySIS of Nat1011al AeronautiCS and Space Actmm•strallon (NASA) ctata I GA0-18-576T 

Note; The confirmation date is the year NASA established and documented a cost and schedule 

baseline for each project. Positive values indicate cost growth or launch delays. Negative values 

indicate cost decreases or earlier than planned launch dates. 

aThe Mars 2020 project used $2.2 mi!llon in funds originally budgeted for development for formulation 

activities. This partially offsets an increase of $12.9 million in development cost growth primarily due 

to increased costs associated with a technology demonstration instrument and entry, descent, and 

landing instrument 

0

The SGSS project reported cost growth up through its first operational readiness review, which is 

currently planned for the end of fiscal year 2019. However, the project expects that there could be 

additional cost and schedule grmNth beyond what is reported here 

c A replan process is initiated if development costs increase by 15 percent or more. NASA replanned 

the SLS program even though development costs did not increase by 15 percent or more. A replan 

does not require a new project baseline to be established. A rebaseline is a process initiated if 

development costs increase by 30 percent or more. When development cost growth is likely to 

Page 12 GA0-18-576T 
36 

exceed the development cost estimate by 15 percent or more, NASA must submit a report to the 

Committee on Science, Space, and Technology of the House of Representatives and the Committee 

on Commerce, Science, and Transportation of the Senate. In addition, if a project or program 

mHestone is likely to be delayed by 6 months or more. this report is also required. 

dNASA officials said they are revising the Orion program's life-cycle cost estimate and expect to 

complete a new estimate in June 2018. The new cost is expected to exceed the program's 

development cost baseline. The current costs in the table reflect the estimate provided in June 2017. 

The cumulative cost change reflects the program shifting $151.7 million of funding previously 

budgeted for the development phase to the formulation phase. 

The deteriorating cost and schedule performance of the portfolio in 2018 

is the result of 

four projects-SLS, EGS, SGSS, and Mars 2020-addressing 

technical challenges that were compounded by risky programmatic 

decisions; 

two projects-JWST and ICESat-2-experiencing delays due to 

technical challenges identified during integration and test; and 

three projects-NISAR, ICON, and GRACE-FO-experiencing cost 

growth or delays largely due to factors outside of the projects' control. 

We elaborate on these three scenarios below. 

Technical challenges compounded by risky programmatic 

decisions. Together, SLS, EGS, SGSS, and Mars 2020 experienced 

$638 million in cost growth and 59 months in aggregate schedule delays 

due to technical problems that were compounded by programmatic 

challenges since our May 2017 report. 17 The SLS and EGS programs 

experienced cost growth and schedule delays associated with EM-1, their 

first combined mission along with the Orion program. We have found for 

several years that the human spaceflight programs-Orion, SLS, and 

EGS-are making progress maturing designs and building hardware, but 

also are experiencing some significant engineering and manufacturing 

challenges. For example, the SLS program ran into numerous challenges 

completing the welding of its core stage element in 2017. The program 

stopped welding on the core stage for months to identify and resolve low 

weld strength in the liquid oxygen and liquid hydrogen tanks due to low 

weld strength measurements found in the liquid oxygen tanks caused by 

a program and contractor decision to change the weld tool configuration 

during fabrication. The EGS program also experienced technical 

challenges, including with the design and installation of the ground 

17GA0-17-303SP. 

Page 13 GA0~18-576T 
37 

support equipment and the 10 umbilicals that connect SLS and Orion to 

the Mobile Launcher-which supports the assembly, testing, and 

servicing of SLS and provides the platform on which SLS and Orion will 

launch. 

Finally, although the Orion program has not yet reported cost grow1h, it 

also experienced technical challenges. These challenges included 

software and hardware delays, and at least 14 months of delays with the 

European Service Module-which provides air, water, power, and 

propulsion to Orion during in-space flight-since the element's critical 

design review in June 2016. In April 2017, we found that, according to 

program officials, the delays with the service module were largely due to 

NASA, the European Space Agency, and the European Space Agency 

contractor underestimating the time and effort necessary to address 

design issues for the first production service module and the availability of 

parts from suppliers and subcontractors. NASA expects the Orion 

program to experience cost grow1h over its cost baseline to the second 

combined mission, Exploration Mission 2 (EM-2). However, the extent of 

the grow1h is unknown because, as noted above, NASA is currently 

revising the program's life-cycle cost estimate. 

Technical challenges such as these are not unusual for large-scale 

programs, especially human exploration programs that are inherently 

complex and difficult. However, we have found that NASA has made 

programmatic decisions-including establishing low cost and schedule 

reserves, managing to aggressive schedules, and not following best 

practices for earned value management or creating reliable cost and 

schedule baselines-that have compounded the technical challenges 

(see table 3)." As a result, the three human spaceflight programs have 

been at risk of cost and schedule growth since NASA approved their 

baselines. 

18GAO, Space Launch System: Management Tools Should Better Track to Cost and 

Schedule Commitments to Adequately Monitor Increasing Risk, GA0-15-596 

(Washington, D.C.: July 16, 2015); NASA Human Space Exploration: Opportunity Nears to 

Reassess Launch Vehicle and Ground Systems Cost and Schedule, GA0-16-612 

(Washington, D.C.: July 27. 2016): Onon Mulb'Purpose Crew Vehicle: Action Needed /o 

Improve Visibility into Cost, Schedule. and Capacity to Resolve Technical Challenges, 

GA0-16-620 (Washington, D.C .. July 27. 2016); and NASA Human Space Exploration. 

Delay Likely for First Exploration Mission, GA0-17-414 (Washington, D.C .. Apr. 27, 2017). 

Cost reserves are for costs that are expected to be incurred-for instance, to address 

project risks-but are not yet allocated to a specific part of the project. Schedule reserves 

are extra time in project schedules that can be allocated to specific activities, elements, 

and major subsystems to mitigate delays or address unforeseen risks. 

Page 14 GA0-18-576T 
38 

Table 3: Examples of Risky Programmatic Decisions Made by National Aeronautics and Space Administration's (NASA) 

Human Spaceflight Programs 

Programmatic decision 

NASA basehned the Exploration 

Ground Systems (EGS), Orion 

Multi-Purpose Crew Vehicle 

(Orion), and Space Launch 

System (SLS) programs with low 

cost and schedule reserves 

NASA managed the EGS, Orion, 

and SLS programs to an internal 

schedule for completing 

development production that was 

aggressive and could exacerbate 

delays and lead to cost overruns. 

The SLS program did not follow 

best practices for using earned 

value management. which 

integrates the project scope of 

work with cost, schedule, and 

performance elements for 

optimum project planning and 

controL 

The Orion and SLS programs 

established baselines that were 

not fully reliable." 

Example(s) 

In July 2016, we found that NASA base!ined 

the SLS program with cost reserves of less 

than 2 percent, even though guidance for 

Marsha!! Space Flight Center-the NASA 

center with responsibility for the SLS 

program-established standard cost reserve 

for launch vehicle programs of 20 percent 

when the baseline is approved. 

In July 2016, we found that the EGS program 

planned to conduct the mobile launcher's 

verification and validation concurrent with 

ground support equipment systems and 

umbilicals installation to support the program's 

internal schedule goal. We found this to be a 

risky practice because of uncertainties 

regarding how systems not yet installed may 

affect the systems already installed 

In July 2016, we found that the SLS program 

had not positioned itself well to provide 

accurate assessments of progress with the 

core stage because it operated for several 

years without a performance measurement 

baseline that is necessary to support full 

earned value management reporting. The use 

of earned value management is advocated by 

both GAO's best practices for cost estimating 

and NASA's own guidance. 

In July 2016, we found that the Orion program 

did not generally follow best practices in 

preparing its cost and schedule esttmates, 

which were key inputs into the program's joint 

cost and schedule confidence !eve! processes 

and baseline. In July 2015, we found that cost 

and schedule estimates for the SLS program 

substantially met five of six characteristics that 

GAO considers best practices for preparing 

reliable estimates, but could not be deemed 

fully reliable because they only partially met 

the stxth characteristic-credibility. 

Negative effect 

Operating with low cost and 

schedule reserves limits a 

program's ability to address 

risks and unforeseen technical 

challenges. 

Working towards a more 

aggressive internal goal is not 

a bad practice: however, 

increasing cost and schedule 

risk to the program in order to 

pursue such a goal is not 

beneficial to programs in the 

long term. 

Programs that do not use 

earned value data are limited 

1n their ability to have accurate 

assessments of project 

progress, produce early 

warning signs of impending 

schedule delays and cost 

overruns. and provide 

unbiased estimates of 

anticipated costs at 

completion. 

Without sound cost and 

schedule estimates, decision 

makers do not have a clear 

understanding of the cost and 

schedule risk inherent in the 

program or important 

information needed to make 

programmatic decisions. 

GAO report(s) 

GA0-17-414 and 

GA0-16-612 

GA0-16-620 and 

GA0-16-612 

GA0-16-612 

GA0-16-620 and 

GA0-15-596 

Source GAO analys>s of pnor GAO reports I GA0-18-576T 

"We did not assess EGS's cost and schedule estimates compared to best practices. 

In December 2017, NASA announced the new internal launch readiness 

date for EM-1 is now December 2019, and has allocated 6 months of 

schedule reserve available to extend the date to June 2020 for possible 

manufacturing and production schedule risks. This represents a delay of 

Page 15 GA0-18-576T 
39 

13-19 months for EM-1. It is too soon to know if NASA has addressed the 

programmatic challenges identified above. We will continue to follow up 

through future reviews. 

Similarly, the SGSS project experienced new cost growth of $59.5 million 

and delayed its completion by 21 months. Project officials attributed the 

cost growth and delays to the contractor's incomplete understanding of its 

requirements, which led to poor contractor plans and late design 

changes. But project management has been a challenge as well. 19 The 

project has historically struggled to manage contractor performance and 

has faced both contractor and project staffing shorttalls, as we found in 

our prior reports starting in 2013. 20 For example, NASA managers noted 

concerns with contractor plans and staffing estimates in 2013 during 

project confirmation. In March 2015, we found that the project was being 

rebaselined due to the contractor's poor cost and schedule performance 

and in order to conform with limitations that NASA placed on the funding 

available to the contractor in fiscal years 2014 and 2015. The contractor 

was also operating with a limited number of staff at that time. In May 

2017, we found that the project continued to experience contractor 

performance problems and had experienced cost growth and schedule 

delays over the 2015 rebaseline even as the project decreased rts scope. 

In addition, the project experienced staff shorttalls in key areas, such as 

systems engineering and business management. 

The Mars 2020 project experienced $12.9 million in development cost 

growth, but no schedule delays. The cost growth was primarily due to 

technical challenges on a technology demonstration instrument and 

higher than anticipated integration costs for an entry, descent, and 

landing instrument. Both instruments are funded by the Human 

Exploration and Operations and Space Technology Mission Directorates. 

NASA officials attributed the cost growth of the technology demonstration 

instrument-which is designed to convert carbon dioxide to oxygen-to 

2016, NASA announced it was reclassifying SGSS as a hybrid sustainment project for 

the Space Network. A hybrid sustainment effort is a sustainment effort that still includes 

development work. The SGSS project expects to experience additional cost growth and 

schedule delays, but the exact magnitude is unknown. The project was reevaluating its 

cost and schedules through its final acceptance review at the time of our review 

20GAO, NASA: Assessments of Selected Large~Scale Projects, GA0-13-276SP 

(Washington, D.C .. Apr. 17, 2013); NASA: Assessments of Selected Large-Scale Projects, 

GA0-14-338SP (Washington, D.C.: Apr. 15, 2014); NASA: Assessments of Selected 

Large-Scale Projects, GA0-15-320SP (Washington, D.C.: Mar. 24, 2015); 

GA0-16-309SP; and GA0-17-303SP. 

Page 16 GA0·18-576T 
40 

the complexity of the technology development for the effort. At the 

project's preliminary design review in February 2016, a critical technology 

for the technology demonstration instrument did not meet the 

recommended level of maturity, which we have found can increase risk 

for systems entering product development. The project had matured the 

technology to this recommended level by its critical design review in 

February 2017. However, as a result of the focus on maturing this 

particular technology, other components of the instrument fell behind the 

planned schedule. Project costs for Mars 2020 also increased for an 

entry, descent, and landing instrument, due, in part, to cost increases for 

integration and to add additional staff to the instrument team to maintain 

schedule. 

Finally, the Radiation Budget Instrument project would have likely 

exceeded its cost baseline if NASA had not decided to cancel the project 

in January 2018. According to NASA's cancellation memorandum, the 

project was canceled because of continued cost growth, technical issues, 

and poor contractor performance. In 2017, we found that the project was 

working to an aggressive schedule, and the prime contractor continued to 

experience cost overruns even after NASA added a deputy project 

manager and increased site visits and meetings with the contractor. 21 

Subsequently, the project-which was developing an instrument to be 

hosted on a National Oceanic and Atmospheric Administration satellitedetermined that it would not be able to meet its delivery date for 

integration with the satellite without requiring additional funding in excess 

of the project's cost baseline if other technical issues arose. In its 

cancellation memorandum, NASA stated continuing to fund the project 

from within the Earth Science Division budget would slow other important 

activities. 

Technical challenges identified during integration and test. The 

JWST and ICESat-2 projects experienced technical challenges during 

integration and test that delayed their schedules. Both projects were 

previously rebaselined before entering system-level integration and 

testing, and the current schedule delays are beyond the new schedules 

that NASA set for the projects in 2011 for JWST and in 2014 for ICESat2. 

Page 17 GA0-18-576T 
41 

The JWST project delayed its launch readiness date by at least 19 

months from October 2018 to May 2020. NASA announced two 

delays for the project since our portfolio-wide review in May 2017. 22 

First, as we found in February 2018, the project delayed its launch 

readiness date by up to 8 months primarily due to the integration of 

the various spacecraft elements taking longer than expected. 23 

Specifically, execution of spacecraft integration and test tasks, due to 

complexity of work and cautious handling given the sensitivity of flight 

hardware, was slower than planned. In addition, before the delay, the 

project used all of its schedule reserves to its prior launch readiness 

date. This was the result of various contractor workmanship errors, 

particularly with respect to the spacecraft propulsion systems, as well 

as the resolution of various technical issues, including a test anomaly 

on the telescope and sunshield hardware challenges. Second, in 

March 2018, NASA announced that it had delayed the project's 

launch readiness date by an additional 11 months to approximately 

May 2020 and planned to establish an external independent review 

board to analyze the project's organizational and technical issues to 

inform a more specific launch time frame. 

The announcement also stated that after a new launch date is 

established, NASA would provide a new cost estimate that may 

exceed the $8 billion congressional cost cap that was established in 

2011. NASA plans to finalize the project's cost and schedule estimate 

by the end of June 2018. Because the additional delays were 

announced while a draft of our May 2018 report was with NASA for 

comment, we plan to follow up on the reasons for the additional 

delays and the results of the analysis in a future review. 

In our prior assessments of JWST. we have made recommendations 

with regard to improving cost and schedule estimating, updating risk 

assessments, and strengthening management oversight NASA has 

generally agreed and taken steps to implement a number of our 

recommendations. For example, in December 2015, we 

recommended that the JWST project require contractors to identify, 

explain, and document anomalies in contractor-delivered monthly 

22GA0-17-303SP. 

23GAO, James Webb Space Telescope: Integration and Test Challenges Have Delayed 

Launch and Threaten to Push Costs Over Cap, GA0-18-273 (Washington, D.C .. Feb. 28, 

2018). 

Page 18 GA0-18-576T 
42 

earned value management reports. 24 NASA concurred with this 

recommendation and, in February 2016, directed the contractors to 

implement the actions stated in the recommendation. However, NASA 

did not implement some recommendations, which if implemented, 

may have provided insight into the challenges it now faces. For 

example, in December 2012, we recommended the JWST project 

update its JCL. 25 Although NASA concurred with this 

recommendation, it did not take steps to implement it. An updated 

JCL may have portended the current schedule delays, which could 

have been proactively addressed by the project. 

The ICESat-2 project delayed its launch readiness date by 4 months 

from June to October 2018 due to technical issues with its only 

instrument, the Advanced Topographic Laser Altimeter System. A key 

part in the instrument's lasers failed during instrument environmental 

testing, which delayed the project's system integration review-the 

start of system-level integration and test. The manufacturer 

determined the primary cause of the anomaly was a flaw in the design 

of the mount that ensures a component of the optical module remains 

in a specific, precise position. The spare flight laser encountered the 

same problem during earlier testing, which indicated a systemic 

problem. The project redesigned and repaired the lasers and is 

proceeding through integration and test. 

External factors. External factors-including responding to requests for 

additional data collection and delays due to launch-vehicle related 

issues-contributed to cost increases or schedule delays for the NISAR, 

ICON, and GRACE-FO projects. 

The NISAR project experienced cost growth as the result of an 

increase in the scope of data collection in response to additional data 

needs being identified by an interagency working group. The 

additional data include soil moisture and natural hazard data that 

would be of value for other federal agencies and the science 

community. NASA officials said the additional funding for development 

would be used to upgrade the ground stations so that they can 

receive the additional data at a higher downlink data rate and volume. 

24GAO, James Webb Space Telescope: Project on Track but May Benefit from Improved 

Contractor Data to Better Understand Costs, GA0-16-112 (Washington, D.C .. Dec. 17, 

2015) 

25GAO, James Webb Space Telescope: Actions Needed to Improve Cost Estimate and 

Oversight of Test and Integration, GA0-13-4 (Washington, D.C Dec. 3, 2012) 

Page 19 GA0~18-576T 
43 

The ICON project missed its committed launch readiness date 

because of an accident involving its launch vehicle. In January 2017, 

two of the Pegasus launch vehicle's three stages were involved in a 

transport accident The stages were subsequently returned to the 

launch vehicle contractor facility for inspection and testing, and no 

damage was found. The project had been on track to launch early. 

Subsequently, in September 2017, an anomaly found in testing of the 

launch vehicle bolt cutter assemblies resulted in additional delays. 

NASA had planned to launch ICON in mid-June 2018, but recently 

announced a delay after off-nominal data was observed from the 

rocket during transit to the launch site. NASA announced a new 

launch date would be determined at a later date. 

The GRACE-FO project delayed its launch readiness date from 

February to May 2018 due to issues with its planned launch vehicle 

and launch site. The launch vehicle is the responsibility of NASA's 

partner on the project-German Research Centre for Geosciences 

(GFZ). GRACE-FO had planned to launch at a Russian launch site. In 

February 2016, GFZ reported that it was notified by the Russian 

Federal Space Agency that the Dnepr launch vehicle was no longer 

available for GRACE-FO. GFZ, in June 2016, arranged to launch the 

two GRACE-FO spacecraft, along with commercial satellites, on a 

SpaceX Falcon 9. On May 22, 2018, GRACE-FO launched from 

Vandenberg Air Force Base in California. 

In addition, the Commercial Crew Program also experienced delays, 

which are not included above because the program does not have a 

schedule baseline. Since the award of the current Commercial Crew 

contracts in September 2014, the program, Boeing, SpaceX, and multiple 

independent review bodies have all identified the contractors' delivery 

schedules as aggressive. In February 2017, we found that Boeing and 

SpaceX had determined that neither could meet their original 2017 dates 

for NASA to certify their systems for human spaceflight 26 In January 

2018, we found that both contractors had notified NASA that final 

certification dates have slipped again and are now in the first quarter of 

calendar year 2019. 27 The Commercial Crew Program's schedule 

26GAO, NASA Commercial Crew Program: Schedule Pressure Increases as Contractors 

Delay Key Events, GA0-17-137 (Washington. DC .. Feb. 16, 2017). 

27 GAO, NASA Commercial Crew Program: Continued Delays Pose Risks for 

Uninterrupted Access to the International Space Station, GA0-18-317T (Washington, 

D.C .. Jan. 17, 2018). 

Page 20 GA0-18-576T 
44 

NASA Is Likely to 

Encounter Additional 

Cost Growth and 

Schedule Delays 

analysis indicates that certification may be further delayed to December 

2019 for SpaceX and February 2020 for Boeing. 

The composition of the portfolio in the coming years is expected to 

include large and complex projects, putting NASA at risk of continued 

cost increases and schedule delays. Specifically, NASA plans to have 

complex projects enter the development portfolio in the next few years as 

it holds confirmation reviews and set cost and schedule baselines. This 

includes the Europa Clipper project and potentially the Wide-Field 

Infrared Survey Telescope (WFIRST) project In February 2018, the 

President's 2019 Budget Request proposed canceling the WFIRST 

project due to the project's significant costs and higher priorities in the 

agency. However, the project may continue iffunding is received. 

Together, preliminary estimates indicate that these two projects could 

cost as much as $7.8 billion. In addition, NASA expects to begin other 

large, complex projects like the Lunar Orbital Platform-Gatewaycurrently being discussed as a space station or outpost in lunar orbitand a Europa Lander project in the coming years. A December 2017 

space policy directive also instructed NASA to return astronauts to the 

moon for long-term exploration and to pursue human exploration of Mars 

and the broader solar system. 

To its credit, NASA recently took steps to put a process in place to control 

the costs of two projects while in formulation, which may prove useful if 

properly executed. 

The Europa Clipper project implemented a process whereby cost 

growth threats would be offset by descoping instruments in whole or 

in part For example, if an instrument exceeds its development cost by 

20 percent, the project would propose a descope option to NASA that 

brings instrument cost below that threshold. NASA had not descoped 

any instruments as of our May 2018 report 

The WFIRST project is responding to findings from an independent 

review that was conducted to ensure the mission's scope and 

required resources are well understood and executable. The review 

found that the mission scope is understood, but not aligned with the 

resources provided and concluded that the mission is not executable 

without adjustments and/or additional resources. For example, the 

study team found that NASA's current forecasted funding profile for 

the WFIRST project would require the project to slow down activities 

starting in fiscal year 2020, which would result in an increase in 

development cost and schedule. NASA agreed with the study team's 

Page 21 GA0·18·576T 
45 

results and directed the project to reduce the cost and complexity of 

the design in order to maintain costs within the $3.2 billion preliminary 

cost target. 

But even with these efforts, NASA's cost and schedule performance may 

be further tested in upcoming years as some expensive, complex projects 

linger in the portfolio longer than expected. 

As previously discussed, the Orion program expects cost growth and 

faces other schedule and technical risks as it moves through the 

integration and test phase for EM-1 into at least 2019 and then 

through 2023 for EM-2. As of August 2017, NASA officials expected 

that new hardware and addressing development challenges would be 

the factors contributing to increased cost for the program. For 

example, there was a cost impact when the program moved from a 

single-piece, or monolithic, heatshield design to one that employs 

blocks in order to improve its structural strength. Program officials 

said they are also assessing schedule delays for EM-2, and noted that 

the EM-2 launch date depends on the outcome of the EM-1 launch 

date. 

The SLS and EGS programs continue to face cost, schedule, and 

technical risks as they move through the integration and test phase 

into at least 2019. For example, SLS will have to complete a "green 

run" test which requires multiple first-time efforts. Specifically, the test 

is the culmination of the development effort and includes the core 

stage integration with its four main engines, fully fueling with 

cryogenic hydrogen and oxygen, and then firing all four engines for 

about 500 seconds. NASA currently has no schedule reserve to its 

target December 2019 launch readiness date for two key areas in the 

core stage schedule. First, there is no reserve between the end of 

core stage production and the delivery of the core stage to the test 

facility. Second, there is no reserve between the end of the testing 

and delivery to Kennedy Space Center for final integration and testing 

prior to launch. 

As previously discussed, the JWST project is at risk of exceeding its 

congressional cost cap, and faces schedule risks as it completes its 

remaining integration and test work. These activities have taken 

considerably longer than planned due to a variety of challenges, 

including reach and access limitations on the flight hardware. 

Additionally, the project faces significant work ahead. For example, 

the project must complete integration of spacecraft element hardware 

and conduct deployment and environmental tests of the integrated 

sunshield and spacecraft. Further, it must integrate the telescope 

Page 22 GA0·18·576T 
46 

element with the spacecraft element to form the JWST observatory, 

and complete another set of challenging environmental tests on the 

full integrated observatory. At the same time, the project will need to 

mitigate dozens of remaining hardware and software risks to 

acceptable levels and address the project's many potential single 

point failures to the extent possible. 

The SGSS project expects to experience additional cost growth 

through the final acceptance review because the full scope of the 

effort has not been included in the cost. NASA only approved its new 

cost estimate through the initial operational readiness review, 

currently planned for September 2019. A project official said NASA 

headquarters asked the project to determine if there are ways to 

reduce the cost between the operational readiness review and the 

final acceptance review. NASA plans to conduct an independent 

review of the project in mid-2018 to inform a decision on whether to 

continue the project past the operational readiness review. If NASA 

decides to continue the project past this review, additional cost growth 

is expected for SGSS when NASA revisits project costs through future 

budget cycles. 

In closing, NASA continues to make improvements to the acquisition 

management of its portfolio of major projects. However, the deterioration 

of the cost and schedule performance of NASA's portfolio this year and 

the likelihood of additional cost growth and schedule delays demonstrate 

the need for NASA to continue to take actions to further reduce 

acquisition risk as we and others have recommended. Continuing to 

improve cost and schedule estimating tools and practices-such as by 

providing projects with sufficient cost and schedule reserves to address 

risks and unforeseen technical challenges and ensuring that program 

offices regularly and consistently update their JCLs across the portfoliocould help to better position NASA for improved outcomes. We look 

forward to continuing to work with NASA and this subcommittee in 

addressing these issues. 

Chairman Babin, Ranking Member Sera, and Members of the 

Subcommittee, this completes my prepared statement. I would be 

pleased to respond to any questions that you may have at this time. 

Page 23 GA0~18-576T 
47 

GAO Contact and 

Staff 

Acknowledgments 

If you or your staff have any questions about this testimony, please 

contact Cristina T. Chaplain, Director, Contracting and National Security 

Acquisitions at (202} 512-4841 or chaplainc@gao.gov. Contact points for 

our Offices of Congressional Relations and Public Affairs may be found 

on the last page of this statement. GAO staff who made key contributions 

to this statement include Molly Traci, Assistant Director; Laura Greifner; 

Erin Kennedy; Miranda Riemer; Roxanna T. Sun; and Alyssa Weir. 

Page 24 GA0-18-576T 
48 

Appendix 1: Descriptions of National 

Aeronautics and Space Administration Major 

Projects Reviewed in GAO's 2018 Assessment 

Table 4: Descriptions of the 26 National Aeronautics and Space Administration (NASA) Major Projects Reviewed in GAO's 

2018 Assessment 

Project name Project description 

Commercia! Crew Program The Commercia! Crew Program facilitates and oversees the development of safe, reliable, 

and cost-effective crew transportation systems by commercial companies to carry NASA 

astronauts to and from the International Space Station. The program is a multi-phase effort 

that started in 2010. During the current phase, the program is working with two contractorsBoeing and SpaceX-that will design, develop, test, and operate the crew transportation 

systems. Once NASA determines the systems meet its standards for human spaceflight-a 

process called certification-the companies will fly up to six crewed missions to the space 

station. 

Double Asteroid Redirection Test The DART project plans to travel to the near-Earth asteroid Didymos, a binary system, and 

(DART) impact the smaller of the two bodies. NASA will assess the deflection result of the impact for 

potential future use on other potentially hazardous near-Earth objects. The project responds 

to near-Earth object guidance by the Office of Science and Technology Policy to better 

understand our impact mitigation posture, and to recommendations by the National Research 

CouncH Committee to conduct a test of a kinetic impactor. The DART mission is part of the 

Asteroid Impact and Deflection Assessment, which is an international collaboration with the 

European Space Agency. 

Europa Clipper The Europa Clipper mission a1ms to mvestigate whether the Jupiter moon could harbor 

conditions suitable for life. The project plans to launch a spacecraft in the 2020s, place it in 

orbit around Jupiter, and conduct a series of investigatory flybys of Europa. The mission's 

planned objectives include characterizing Europa's 1ce she!! and any subsurface water, 

analyzing the composition and chemistry of its surface and ionosphere, understanding the 

formation of its surface features, and surveying sites for a potential landed mission. 

Exploration Ground Systems (EGS) The EGS program is modernizing and upgrading Infrastructure at the Kennedy Space Center 

and developing software needed to integrate, process, and launch the Space Launch System 

(SLS) and Orion Multi-Purpose Crew Vehicle (Orion). The EGS program consists of several 

major construction and facilities projects including the Mobile Launcher, Crawler Transporter, 

Vehicle Assembly Building, and launch pad. a!! of which need to be complete before the first 

uncrewed exploration mission using the SLS and Orion vehicles. 

Gravity Recovery and Climate The GRACE-FO mission will continue and expand upon the 2002 GRACE mission, which 

Experiment Follow-On (GRACE-FO) ended science operations in October 2017. The system, which consists of two spacecraft 

working together to obtain scientific measurements, wiU provide high-resolution models of 

Earth's gravity field and insight into water movement on and beneath the Earth's surface for 

up to 5 years. These models wm provide rates of ground water depletion and polar 1ce melt 

and enable improved planning for droughts and floods. GRACE-FO is a collaborative effort 

with the German Research Centre for Geosciences, 

Ice, Cloud, and Land Elevation 

Satellite-2 (ICESat-2) 

Interior Exploration using Seismic 

Investigations, Geodesy, and Heat 

Transport (InSight) 

·------------,---,--;-- The ICESat-2 mission is a fo!low~on mission to ICESat that WIH measure changes in polar 

ice-sheet mass and elevation_ The measurements will provide researchers a better 

understanding of the mechanisms that drive polar ice changes and their effect on global sea 

leveL ICESat-2's upgraded laser instrument will allow the satellite to make more frequent 

measurements and provide better elevation estimates over certain types of terrain than 

ICESat. 

InSight is a Mars lander with two primary objectives, It is intended to further understanding of 

the formation and evolution of terrestrial planets by determining Mars's size, its composition, 

and the physical state of the core; the thickness of the crust; and the composition and 

structure of the mantle, as well as the thermal state of the interior. It will also determine the 

present level of tectonic activity and the meteorite impact rate on Mars. InSight is based on 

the Phoenix lander design. Phoenix successfully landed on Mars in 2008. 

Page 25 GA0-18-576T 
49 

Appendix 1: Descriptions of National 

Aeronautics and Space Administration Major 

Projects Reviewed in GAO's 2018 Assessment 

Project name Project description 

Ionospheric Connection Explorer The ICON observatory will orbit Earth to explore its ionosphere-the boundary region 

(ICON) between Earth and space where ionized plasma and neutral gas collide and react Its four 

instruments will make direct measurements and use remote sensing to further researchers' 

understanding of Earth's upper atmosphere, the Earth·Sun connection, and the ways in 

which Earth weather drives space weather 

James Webb Space Telescope JWST is a large, infrared·optimized space telescope designed to help understand the origin 

(JWST) and destiny of the universe, the creation and evolution of the first stars and galaxies, and the 

formation of stars and planetary systems. It will also help further the search for Earth-like 

planets. JWST will have a large primary mirror composed of 18 smaller mirrors and a 

sunshield the size of a tennis court. Both the mirror and sunshield are folded for launch and 

open once JWST is in space. JWST will reside in an orbit about 1 million miles from the 

Earth 

Landsat 9 Landsat 9 is the next satellite in the Landsat senes Program, which provides a continuous 

space~based record of land surface observations to study, predict, and understand the 

consequences of land surface dynamics, such as deforestation. The program is a 

collaborative, joint mission between NASA and the U.S. Geological Survey. The Landsat data 

archive constitutes the longest continuous moderate·resolution record of the global land 

surface as viewed from space and is used by many fields, such as agriculture, mapping, 

forestry, and geology 

Laser Communications Relay LCRD is a technology demonstration mission with the goa! of advancing optical 

Demonstration (LCRD) communication technology for use in deep space and near·Earth systems. LCRD will 

demonstrate bidirectional !aser communications between a satellite and ground stations, 

develop operational procedures, and transfer the technology to industry for future use on 

commercial and government satellites. NASA anticipates using the technology as a next 

generation Earth relay as well as to support near~Earth and deep space science, such as the 

International Space Station and human spaceflight missions. The project is a mission partner 

and will be a payload on a U.S. Air Force Space Test Program satellite. 

Low Boom Flight Demonstrator (LBFO) LBFD is a flight demonstration project planned to demonstrate that noise from supersonic 

flight-sonic boom-can be reduced to acceptable levels, allowing for eventual commercia! 

use of overland supersonic flight paths. Plans include multiple flights beyond fiscal year 2022 

to gather community responses to the flights and to create a database to support 

development of international noise rules for supersonic flight. 

Lucy Lucy wlll be the first mission to investigate the Trojans, which are a population of never· 

explored asteroids orbiting in tandem with Jupitec The project aims to understand the 

formation and evolution of planetary systems by conducting flybys of these remnants of giant 

planet formation. The Lucy spacecraft will first encounter a main belt asteroid-located 

between the orbits of Mars and Jupiter-and then wm travel to the outer solar system where 

the spacecraft wm encounter six Trojans over an 11-year mission. The mission's planned 

measurements include asteroid surface color and composition, interior composition, and 

surtace geology 

Mars 2020 Mars 2020 is part of the Mars Exploration Program, which seeks to further understand 

whether Mars was, is, or can be a habitable planet Its rover and science instruments will 

explore Mars and conduct geological assessments, search for signs of ancient life, determine 

potential environmental habitability, and prepare soil and rock samples for potential future 

return to Earth. The rover wHI include a technology demonstration instrument designed to 

convert carbon dioxide into oxygen. Mars 2020 is based heavily on the Mars Science 

Laboratory, or Curiosity, which landed on Mars 10 2012 and remains in operation. 

Page 26 GA0·18·576T 
50 

Project name 

NASA !SRO Synthetic Aperture Radar 

(NISAR) 

Orion Multi-Purpose Crew Vehicle 

(Orion) 

Parker Solar Probe (PSP) 

Plankton, Aerosol, Cloud, ocean 

Ecosystem (PACE) 

Psyche 

Radiation Budget Instrument (RBI) 

Restore~L 

Space Launch System (SLS) 

Appendix 1: Descriptions of National 

Aeronautics and Space Administration Major 

Projects Reviewed In GAO's 2018 Assessment 

Project description 

NISAR is a joint project between NASA and Indian Space Research Organisation (!SRO) that 

will study the solid Earth, ice masses, and ecosystems. It aims to address questions related 

to global environmental change, Earth's carbon cycle, and natura! hazards, such as 

earthquakes and volcanoes. The project will include the first dual frequency synthetic 

aperture radar instrument, which will use advanced radar imaging to construct large-scale 

data sets of the Earth's movements. NJSAR represents the first major aerospace science 

partnership between NASA and !SRO 

Onon is being developed to transport and support astronauts beyond low-Earth orbit, 

including traveling to Mars or an asteroid. The Orion program is continuing to advance 

development of the human safety features, designs, and systems started under the 

Constellation program, which was canceled in 2010. Orion is planned to launch atop NASA's 

Space Launch System. The current design of Orion consists of a crew module, service 

module, and launch abort system. 

PSP will be the first NASA mission to visit a star. Using the gravity of Venus, the spacecraft 

wm orbit the Sun 24 times and gather information to increase knowledge about the solar 

wind, including its origin, acceleration, and how it is heated. PSP instruments will observe the 

generation and flow of solar winds from very close range and sample and take 

measurements of the Sun's outer atmosphere, where solar particles are energized. To 

achieve its mission, parts of the spacecraft must be able to withstand temperatures 

exceeding 2,500 degrees Fahrenheit and endure blasts of extreme radiation. The project was 

formerly named Solar Probe Plus, or SPP, and was renamed in May 2017. 

PACE is a polar-orbiting mission that will use advanced global remote sensing mstruments to 

improve scientists' understanding of ocean biology, biogeochemistry, ecology, aerosols, and 

cloud properties. PACE will extend climate-related observations begun under earlier NASA 

missions, which will enable researchers to study long-term trends on Earth's oceans and 

atmosphere, and ocean-atmosphere interactions. PACE will also enable assessments of air 

and coastal water quality, such as the locations of harmful algae blooms. 

Psyche will be the first mission to vistt a metal asteroid and aims to understand a previously 

unexplored component of the early building blocks of planets: tron cores. The project plans to 

orbit the Psyche asteroid to determine if it is a planetary core, characterize its topography, 

assess the elemental composition, and determine the relative ages of its surface regions 

RBI is a scanning radiometer that NASA planned to launch on the National Oceanic and 

Atmospheric Administration's {NOAA) Joint Polar Satellite System 2. RBI's planned mission 

was to support global climate monitoring by conttnuing measurements of the Earth's reflected 

sunlight and emitted thermal radiation made by NASA and NOM satellites over the past 30 

years. This data was intended to represent one of two key sets of measurements needed to 

determine whether the Earth is warming or cooling. 

The Restore-L project will demonstrate the capability to refuel on-orbit satellites for eventual 

use by commercial entities. Specifically, Restore-L plans to autonomously rendezvous with, 

inspect, capture, refuel, adjust the orbit of, safely release, and depart from the U.S. 

Geological Survey's Landsat 7 satellite. Landsat 7 can extend operations 1f successfully 

refueled, but it is planned for retirement if the technology demonstration is unsuccessful. 

SLS iSin1:ended to be NASA's first human-rated heavy-lift launch vehicle since the Saturn V 

was developed for the Apollo program. SLS is planned to launch NASA's Orion spacecraft 

and other systems on missions between the Earth and Moon and to enable deep space 

missions, including Mars. NASA is designing SLS to provide an initial lift capacity of 70 metric 

tons to low~Earth orbit, and be evOlvable to 130 metric tons, enabling deep space missions. 

The 70~metric~ton capability will include a core stage, powered by four RS-25 engines, and 

two five-segment boosters. The 130~metric-ton capability will use a new upper stage and 

evolved boosters. 

Page 27 GA0·18-576T 
51 

Appendix 1: Oescrlptlons of National 

Aeronautics and Space Administration Major 

Projects Reviewed in GAO's 2018 Assessment 

Project name Project description 

Space Netwo=-r"'k"""G'"'ro-:-u=n=d ""s-=-eg=m-=-e=n=-t --:;T;:-he:_S"'G"s"'s"=-pr=ol'::. e:;ct=p-::la=n-:-s =to-::d;:ec:ve:;-lo::pc:a::n:;d-:;d:;el-:-iv-=-er:-:a:-:n:-:e-:-w:-:gc:ro-:-u=n=d -::sy=s::te=m:-:f:::o::-r o:-:n=e's'"'p-::ac:-:e-;N::-e::tw-::o::rk::-

Sustainment (SGSS} site. The Space Network provides essential communications and tracking services to NASA 

and non-NASA missions. Existing systems, based on 1980s technology, are increasingly 

obsolete and unsustainable. The new ground system will include updated systems, software, 

and equipment that will allow the Space Network to continue to provide critical 

communications services for the next several decades. The Space Network is managed by 

the Space Communication and Navigation program 

Surface Water and Ocean Topography 

(SWOT) 

Transiting Exoplanet Survey Satellite 

(TESS) 

Wide-Field Infrared Survey Telescope 

(WFIRST) 

Source GAO I GA0·18-576T 

(102809) 

The SWOT mission will use its wide-swath radar altimetry technology to take repeated highresolution measurements of the world's oceans and freshwater bodies to develop a global 

survey. This survey will make it possible to estimate water discharge into rivers more 

accurately, and help improve flood prediction. It will also provide global measurements of 

ocean surface topography and variations in ocean currents, which will help improve weather 

and climate predictions. SWOT is a joint project between NASA and the French Space 

Agency-the Centre National d'Etudes Spatiales. 

TESS will use four identical, wide field-of-view cameras to conduct the first extensive survey 

of the sky from space for transiting exoplanets-or planets in other solar systems. The 

mission's goal is to discover these exoplanets during transit the time when the planet's orbit 

carries it in front of its star as viewed from Earth. The project plans to discover rocky and 

potentially habitable Earth-sized and super-Earth planets orbiting nearby bright stars for 

further evaluation through ground- and space-based observations by other missions, such as 

JWST. 

WFIRST is an observatory designed to perform wide-field imaging and survey of the nearInfrared sky to answer questions about the structure and evolution of the universe, and 

expand our knowledge of planets beyond our solar system. The project will use a telescope 

that was originally built and qualified by another federal agency. The project plans to launch 

WFIRST in the mid-2020s to an orbit about 1 million miles from the Earth. The project is also 

planning a guest observer program, in which the project may provide observation time to 

academic and other institutions. 

Page 28 GA0-18-576T 
52 

This is a work of the U.S. government and is not subject to copyright protection in the 

United States. The published product may be reproduced and distributed in its entirety 

without further permission from GAO. However, because this work may contain 

copyrighted images or other material, permission from the copyright holder may be 

necessary if you wish to reproduce this material separately. 
53 

GAO's Mission 

Obtaining Copies of 

GAO Reports and 

Testimony 

Order by Phone 

Connect with GAO 

To Report Fraud, 

Waste, and Abuse in 

Federal Programs 

Congressional 

Relations 

Public Affairs 

Strategic Planning and 

External Liaison 

The Government Accountability Office, the audit, evaluation, and investigative 

arm of Congress, exists to support Congress in meeting its constitutional 

responsibilities and to help improve the performance and accountability of the 

federal government for the American people. GAO examines the use of public 

funds; evaluates federal programs and policies; and provides analyses, 

recommendations, and other assistance to help Congress make informed 

oversight, policy, and funding decisions. GAO's commitment to good government 

is reflected in its core values of accountability, integrity, and reliability. 

The fastest and easiest way to obtain copies of GAO documents at no cost is 

through GAO's website (https://www.gao.gov). Each weekday afternoon, GAO 

posts on its website newly released reports, testimony, and correspondence. To 

have GAO e-mail you a list of newly posted products, go to https://www.gao.gov 

and select "E-mail Updates." 

The price of each GAO publication refiects GAO's actual cost of production and 

distribution and depends on the number of pages in the publication and whether 

the publication is printed in color or black and white. Pricing and ordering 

information is posted on GAO's website, https://www.gao.gov/ordering.htm. 

Place orders by calling (202) 512-6000, toll free (866) 801-7077, or 

TDD (202) 512-2537. 

Orders may be paid for using American Express, Discover Card, MasterCard, 

Visa, check, or money order. Call for additional information. 

Connect with GAO on Facebook, Flickr, Twitter, and YouTube. 

Subscribe to our RSS Feeds or E-mail Updates. Listen to our Podcasts 

Visit GAO on the web at https://www.gao.gov. 

Contact: 

Website: https://www.gao.gov/fraudnet/fraudnet htm 

Automated answering system: (800) 424-5454 or (202) 512-7470 

Orice Williams Brown, Managing Director, WilliamsO@gao.gov, (202) 512-4400, 

U.S. Government Accountability Office, 441 G Street NW, Room 7125, 

Washington, DC 20548 

Chuck Young, Managing Director, youngc1 @gao.gov, (202) 512-4800 

U.S. Government Accountability Office, 441 G Street NW, Room 7149 

Washington, DC 20548 

James-Christian Blackwood, Managing Director, spel@gao.gov, (202) 512-4707 

U.S. Government Accountability Office, 441 G Street NW, Room 7814, 

Washington, DC 20548 

(j Please Print on Recycled Paper. 
Development Cost Performance and Average Launch 

for Major NASA Projects from 2009 to 2018 

Percentage 

50 

45 

40 

35 

30 

25 

20 

15 

10 

5 

0 

Months 

12 

11 

10 

9 

7 

6 

5 

4 

0 

2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 

- Percentage cost growth 

Average launch delay 

Number of projects in development 

Source: GAO analysis of National Aeronautics and Space Administration (NASA) data. I GA0-18-576T 
Reasons Why NASA Major Projects 

Experience Cost and Schedule Growt

- Risky management decisions 

Technical problems (may or may not be able to be avoided) 

Issues beyond the project's control 
Number of NASA's Major Projects Attaining Technology Ma

by Preliminary Design Review from 2010 to 2018 

Number of projects 

20 

15 

10 

5 0 

2010 2011 

Report year 

2012 2013 2014 2015 2016 2017 

Technology demonstration projects that did not meet technology maturity criteria 

_ Projects not meeting technology maturity criteria 

.. Projects meeting technology maturity criteria 

Source: GAO analysis of National Aeronautics and Space Administration data. 1 GA0-18-280SP 

2018 
57 

Cristina T. Chaplain 

Ms. Chaplain currently serves as a Director, Contracting and National Security 

Acquisitions, at the U.S. Government Accountability Office. She has responsibility for 

GAO assessments of military space acquisitions, NASA, and the Missile Defense 

Agency. Among other topics, she has led reviews on the International Space Station, 

the Space Launch System and the Orion crew capsule, acquisition progress for major 

NASA projects, the James Webb telescope, commercial cargo and crew, NASA 

contract management, contract terminations, weather satellites, and the Global 

Positioning System. In addition to her work on space and missile system development, 

Ms. Chaplain has led a variety of DOD-wide contracting-related and best practice 

evaluations for the GAO. Before her current position, Ms. Chaplain worked with GAO's 

financial management and information technology teams. Ms. Chaplain has been with 

the GAO for 26 years. She received a bachelor's degree, magna cum laude, in 

International Relations from Boston University and a Masters Degree in Journalism 

from Columbia University. 
58 

Chairman BABIN. Thank you, ma’am. 

I now recognize Mr. Jurczyk for five minutes to present his testimony. 

TESTIMONY OF MR. STEVE JURCZYK, 

ASSOCIATE ADMINISTRATOR, NASA 

Mr. JURCZYK. Mr. Chairman and Members of the Committee, I 

am pleased to have the opportunity to discuss NASA’s program 

management accomplishments and challenges. 

NASA is focused on its mission of science and exploration. In 

support of this mission, the agency has developed a rigorous process for program formulation, approval, implementation, and evaluation. NASA’s challenge is to develop and improve our program 

project management capabilities to ensure both efficiency and accountability. We must execute and deliver missions on cost and on 

schedule. We have to execute in an environment that includes some 

significant risk, and we are focused on identifying and characterizing risks as quickly as possible. We must take corrective actions 

promptly, whether mitigating, accepting, evaluating, or monitoring 

an identified risk. 

NASA implements a rigorous process for project formulation, development, and execution. Projects proceed through a series of key 

decision gates. At Key Decision Point C, which we refer to as KDP– 

C, the agency commits to deliver a project within an established 

baseline cost and schedule. This agency baseline commitment is the 

baseline against we which we evaluate performance. 

Beginning in 2009, NASA adopted a joint confidence level—or 

JCL—approach to producing estimates, and this approach has resulted in improved performance. The JCL employs probabilistic 

risk assessment to establish a confidence level for an estimate. 

Typical NASA—typically, NASA establishes baselines for major 

projects around a 70 percent confidence level. Since the agency established its JCL policy, programmatic performance has significantly improved as NASA has launched more projects at or near 

their original cost and schedule baselines. 

NASA is committed to applying a robust set of available authorities to accomplish our mission efficiently and effectively. NASA’s 

strategic acquisition process utilizes multiple authorities to meet 

agency objectives, including, though not limited to, federal acquisition regulation or FAR-based contracts, grants, cooperative agreements, international agreements, and Space Act Agreements. 

NASA has expanded its use of fixed-price contracts where appropriate with the percentage of funds NASA spends on firm fixedprice contracts increasing from 26 percent in 2013 to 35 percent in 

2016. 

The JCL approach has certainly improved our performance, and 

we look forward to building on this success to address our ongoing 

challenges with major projects. NASA is working to strengthen program planning and control through a series of initiatives, including 

the application of industry-standard earned value management 

processes. NASA began the process of applying an in-house EVM 

capability in 2013 and has broadened its use in a stepwise fashion 

over time. NASA is leading an effort through the scheduling initia-
59 

tive to strengthen schedule management by building a community 

to identify and reinforce schedule management best practices. 

Our decision to conduct independent reviews of both WFIRST 

and JWST missions, along with our continued support for regular 

GAO reviews and audits, illustrate our commitment to transparency and our determination to identify risks as early as possible 

and immediately take action to mitigate them. 

Finally, Mr. Chairman, NASA will continue to accept the big 

challenges that the Committee and the nation place before us. Our 

missions will continue to incorporate cutting-edge technologies and 

to pursue the challenging goals that can only be accomplished in 

the hostile environment of space. NASA missions do things that 

have never been done before. The Parker Solar Probe will dive into 

the sun’s corona. The James Webb Space Telescope will unfold 

itself almost a million miles from Earth and operate at minus 380 

degrees Fahrenheit. The Space Launch System or SLS will enable 

humans to travel deeper into space than ever before. These missions will employ technologies that must be developed and tested 

on Earth but can only be demonstrated in space. 

All this is to say that NASA must accept the risk, but we are 

committed to managing that risk and executing within our cost and 

schedule commitments. 

Thank you for the invitation to testify before you today, and I 

look forward to answering any questions you may have. 

[The prepared statement of Mr. Jurczyk follows:] 
60 

HOLD FOR RELEASE 

UNTIL PRESENTED BY WITNESS 

June 14, 2018 

Statement of 

Stephen Jurczyk 

Associate Administrator 

National Aeronautics and Space Administration 

before the 

Subcommittee on Space 

Committee on Science, Space, and Technology 

United States House of Representatives 

Mr. Chairman and Members of the Committee, I am pleased to have this opportunity to discuss 

NASA program management accomplishments and challenges. 

NASA is focused on its mission of science and exploration. With consistent support from 

Congress, we look forward to extending human presence beyond low Earth orbit, exploring 

potentially habitable environments around the solar system, deepening our understanding of our 

home planet, pushing our observations of the universe back to the time when the first stars were 

forming, and opening the space frontier. In support of this mission, the Agency has developed a 

rigorous process for program formulation, approval, implementation and evaluation. We see 

excellence in program management as a core capability, and critical for enabling exploration. 

NASA's program management expertise brings together the people, resources and processes 

necessary to execute the most challenging and complex programs as we explore our world and 

our universe. 

We take our responsibilities as stewards of limited federal resources very seriously and we will 

apply a robust set of available authorities to accomplish our mission efficiently and effectively. 

At the same time, the nation expects NASA to embrace big challenges. NASA must continue to 

manage risk to acceptable levels. Our missions will continue to incorporate cutting-edge 

technologies and to pursue the challenging goals that can only be accomplished in the hostile 

environment of space. NASA missions do things that have never been done before. The Parker 

Solar Probe will dive into the Sun's corona. The James Webb Space Telescope (JWST) will 

unfold itself almost a million miles from Earth and operate at extremely cold temperatures --

approximately -380 degrees Fahrenheit or -228 degrees Celsius. The Space Launch System 

(SLS) will enable humans to travel deep into space. These missions will employ technologies 

that must be developed and tested on Earth, but can only be demonstrated in space. Innovation is 

1 
61 

the foundation of everything NASA does, and we cannot encourage innovation and discovery 

without accepting some level of risk and uncertainty. 

NASA's challenge is to develop and improve our program/project management capabilities 

necessary to ensure both efficiency and accountability in what is, inevitably, a dynamic and 

challenging development environment. We appreciate that, in order to retain the confidence of 

Congress and the American people, we must execute and deliver missions on cost and on 

schedule. At the same time, we must identify and characterize risks as quickly as possible so we 

can promptly take the appropriate corrective action, whether that is mitigating, accepting, 

evaluating, or monitoring. 

NASA Procedural Requirement 7120.5E establishes NASA's rigorous process for project 

formulation, development, and execution. Projects proceed through a series of key decision 

gates and generate cost and schedule estimates with increasing levels of fidelity as they transition 

through the project development lifecycle. The Agency makes the decision on whether a project 

should proceed out of its formulation phase and into its development phase, and establishes the 

cost and schedule baselines, at Key Decision Point C (KDP-C). At KDP-C, projects with a life 

cycle cost of$250 million or more must generate a resource-loaded schedule and produce a Joint 

Confidence Level (JCL) estimate for cost and schedule. A JCL calculates the probability that 

cost will be equal or less than the targeted cost and schedule will be equal or less then the 

targeted schedule date. The JCL estimate is risk-informed and executable within the available 

annual resources and launch constraints. For each major project, NASA establishes an 

independent review board. NASA's selection and vetting process ensures the necessary 

technical and programmatic areas are covered expertly and adequately, while simultaneously 

satisfYing the Agency-level need to have an informed, independent assessment and 

recommendation to the convening authorities and decision authority at KDPs. The review board 

functions independently of the program or project, with members selected from outside the 

program or project management chain, free of any organizational or personal conflicts of interest 

(or have approved mitigation plans in place where necessary). The review board evaluates the 

inputs to the project-generated estimates and produces its own JCL results for management that 

considers the independently-informed risks. 

With a decision to proceed at KDP-C, the Agency commits externally to deliver the project 

within the established baseline cost and schedule. This "Agency Baseline Commitment" (ABC) 

is the appropriate baseline against which to evaluate performance. Typically, the ABC is 

established around a 70 percent confidence level based on the JCL estimate, meaning that a 

degree of programmatic risk exposure remains as the project is implemented. Because some 

programmatic uncertainty remains following KDP-C, projects continue to generate estimates, 

and independent review boards continue to evaluate the project as it enters the next phases of the 

development life cycle. Specifically, these reviews evaluate the project's cost and schedule 

performance and provide forewarning should any project begin to significantly deviate from its 

ABC. 

NASA policy does not require a program or project to continue to recalculate the JCL through 

the balance of the program/project development, but uses a variety of performance metrics, 

2 
62 

including Eamed Value Management, to assess how well the program or project is perfom1ing 

against its plan. NASA appreciates the open dialog we have had over the past several years with 

the Govemment Accountability Office (GAO) as we have refined our project management 

requirements and discussed best practices that might apply to our projects at different stages in 

their lifecycles. 

NASA first established its JCL policy in 2009 by requiring a JCL of major projects coming to 

confim1ation. This requirement was subsequently expanded to include cost and schedule ranges 

for projects going through Key Decision Points during the Formulation Phase. Since the Agency 

established its JCL policy, programmatic performance has improved as NASA has launched 

more projects at or nearer their original cost and schedule baselines. NASA's approach to 

conducting JCLs has evolved as we have gained more experience, and the Agency continues to 

improve the process. 

NASA is currently undergoing critical development activities on several major space flight 

systems. These larger projects typically involve the development of a greater number of new 

technologies and a significantly higher degree of system complexity, which present greater risk 

and are more difficult to estimate and assess at the outset. Other challenges commonly found in 

larger projects may include extensive and critical interagency or intemational partnerships, high 

fixed labor costs, a large multi-state distributed workforce, multi-build/production projects, 

among others that are difficult to capture in the baseline plan estimates feeding JCL and similar 

analysis. 

In 2015, NASA made a decision to reorganize and realign the Agency's independent assessment 

function toward the goals of ensuring mission success and clarifying management accountability. 

Programmatic Analysis Capability, which consists of resource analysis, schedule management, 

cost estimation, program/project pcrfom1ance progress and forecasting, and independent 

assessment activities, faced particular examination. The most significant action in support of this 

intent was the dissolution of the Independent Program Assessment Office (IPAO), as well as that 

of its umbrella organization, the Office of Evaluation (OoE). The other functioning office, the 

Cost Analysis Division (CAD), transitioned to the Office of the Chief Financial Officer (OCFO). 

Again, the intent of this action was not about eliminating independent assessment of programs 

and projects; that function remains vital to NASA's long-term success. Rather it is about the 

need to clarify accountability of the Mission Directorates and the performing Centers, as well as 

about enabling more of our skilled workforce toward in-line program/project work. In addition, 

in alignment with the Program Management Improvement and Accountability Act (PMIAA), 

NASA has designated a Program Management Improvement Officer reporting directly to the 

Associate Administrator (Chief Operating Officer), who will ensure proper fulfillment of 

requirements set forth in the soon-to-be-released OMB PMIAA implementation guidance. 

NASA is working to strengthen Program Plam1ing and Control (PP&C) through a series of 

initiatives, including the application of industry standard Earned Value Management (EVM) 

processes. NASA began the process of applying an in-house EVM capability in 2013, and has 

broadened its use in steps over time. EVM is a powerful project management tool that ensures 

good up front planning and supports reliable cost and schedule perfom1ance data, including 

accurate Estimate-At-Completion (EAC) forecasts, and has already begun to pay dividends by 

3 
63 

helping the Agency improve performance in both cost and schedule commitments. NASA 

recognizes that tailoring and honing processes to meet a project's unique risk posture and 

environment is key to effective management. As such, NASA continues to employ EVM policy 

with the goal of maximizing efficiencies. 

NASA is leading an effort, through the Schedule Initiative, to strengthen schedule management 

by building a community to identify and reinforce schedule management best practices. NASA 

is updating its schedule management handbook to fonnally capture best practices proven to be 

successful within the Agency, which will enhance continuous improvements to schedule 

processes and capabilities. A centralized, formal PP&C training curriculum, including schedule 

management, is being defined to cultivate the development and grow proficiency levels within 

the schedule management workforce. 

Contractor Accountability and Acquisition Strategy 

NASA's strategic acquisition process supports obtaining or advancing the development of 

science, aeronautics, space technology and human exploration to fulfill the Agency's mission. 

NASA utilizes multiple authorities to meet these objectives. NASA's acquisition authorities 

include, but are not limited to: Federal Acquisition Regulation (FAR)-based contracts, grants, 

cooperative agreements, international agreements, and Space Act Agreements (SAA). In 

deciding on the best acquisition strategy for a program or project, NASA considers such factors 

as: resource availability; impact on the Agency workforce; maintaining core capabilities; makeor-buy planning; potential for partnerships; and the availability of the industrial base capability 

and supply chain needed to design, develop, produce, and support the program or project. 

Another important element in the development of the acquisition strategy for a program or 

project is the selection of contract type and associated contractor incentive structures. NASA 

weighs the use of various contract types and incentive structures to motivate optimal contractor 

performance and achieve mission success while at the same time, controlling costs and meeting 

schedule milestones. 

Given the nature ofNASA's mission, many of our procurements are for complicated research 

and development efforts that involve complex requirements, where the likelihood of changes 

makes it difficult to estimate performance costs in advance. Consequently, in many cases, a costplus type contract is appropriate due to these complex requirements, significant technical risk, 

and cost uncertainty. In order to mitigate the cost risk associated with cost type contracts, NASA 

utilizes the full range of contract incentives afforded in the FAR in order to properly incentivizc 

the contractor to control costs while perfom1ing at an optimal level and delivering the products 

or services that meet the agency's requirements on schedule. NASA has expanded its use of 

fixed-price contracts where appropriate. The agency has utilized fixed price contracts when 

industry products are mature and flight proven, and when we are purchasing a service. The 

percentage of funds NASA spends on firm fixed-price contracts has increased from 26 percent in 

2013 to 35 percent in 2016. These contracts can be more advantageous to the government by 

shifting a substantial portion of the cost risk to the contractor, thus significantly incentivizing the 

contractor to control costs. 

4 
64 

Additionally, NASA has employed an innovative partnership approach to developing some 

needed capabilities while encouraging commercial innovation. NASA's Commercial Orbital 

Transportation Services (COTS) and Lunar Cargo Transportation and Landing by Soft 

Touchdown (Lunar CATALYST) initiatives both represent examples of NASA using Space Act 

Agreements to provide support to industry partners developing commercial space capabilities 

that could eventually support both government and commercial users. The particular approaches 

to be employed in future partnerships will depend on a variety of factors and on applicable 

lessons learned from previous partnerships. 

NASA's commitment to responsible stewardship offederal resources is also reflected in the 

Agency's policy to detect and correct instances of fraud and corruption. This policy is important 

in order to maintain operational readiness, recoup lost financial resources, maintain public 

confidence in NASA procurement and non-procurement activities, and to prevent future 

fraudulent conduct. For over a decade, NASA has instituted and maintained the Office of the 

General Counsel Acquisition Integrity Program, a comprehensive coordination of fraud remedies 

program to: (I) promote transparency, accountability, and integrity throughout the acquisition 

process; (2) improve effectiveness of Agency operations and enhance the Agency mission by 

combating fraud, waste, and abuse on NASA contracts, other funding instruments, and other 

commitments of NASA resources; and (3) monitor and ensure the coordination of criminal, civil, 

contractual, and administrative (suspension and debarment) remedies. Throughout the duration 

of the program, the Acquisition Integrity Program has helped the federal government recover 

over $365 million and handled over 270 suspension and debarn1ent related actions to protect the 

government's interest and ensure the integrity of the acquisition process. 

GAO's most recent assessment of major NASA projects "NASA: Assessments of Major 

Projects" (GA0-18-280SP), provides NASA with a valued independent perspective on our major 

acquisitions. The report includes assessments of our 26 major projects in development. NASA 

recognizes some development challenges exist in these projects that have resulted in recently 

revised cost and schedule plans. We value the insights and recommendations provided to us in 

this report as an independent source of information that we use internally to inform and make 

new policy decisions toward programmatic improvement. 

Space Launch System {SLS)/Orion Deep Space Missions 

SLS, Orion, and the Exploration Ground Systems (EGS) that support them are critical 

capabilities for maintaining and extending U.S. human spaceflight leadership beyond low-Earth 

orbit (LEO) to the Moon and eventually, to Mars and beyond .. NASA plans to launch an initial, 

uncrewed deep space test flight of the new heavy-lift SLS and Orion spacecraft to lunar orbit on 

Exploration Mission-! (EM-I), in FY 2020, in preparation for the first crewed mission, EM-2. 

The FY 2019 budget fully funds the Agency baseline commitment schedule to fly the Orion 

spacecraft on EM-2 no later than FY 2023 while enabling NASA to begin work on post EM-2 

missions. FY 2018 appropriations (including direction to develop a second Mobile Launcher 

[ML] at the Kennedy Space Center specifically for the SLS Block 18 and a decision to use a 

Block I SLS for EM-2 for roughly $600 million), provide an opportunity to potentially 

accelerate the EM-2 crewed mission by 6-months relative to a currently estimated launch in mid2023. Missions on the SLS and Orion in the 2020s will reaffirn1 and sustain U.S. leadership in 

5 
65 

orbit around and on tbe surface of the Moon, and establish the capability to operate safely and 

productively in deep space for decades to come. 

NASA's new deep space exploration system is seeing specific areas of targeted challenges 

consistent with first-time production and testing of a complex human spacecraft system for deep 

space. Most recently, SLS has been managing a slower-than-expected ramp up in core stage 

production, due in part to contamination recently seen in some of the propellant lines installed in 

the engine section. These issues be resolved through a continued focus on managing processes 

and resources at the Michoud Assembly Facility in Louisiana. NASA is also closely managing 

the development and testing of hardware and software to support integration at KSC, and 

working well with the European Space Agency to ensure delivery of the Orion service module 

this summer. 

Some flight hardware is already in production for EM-2, including the crew module pressure 

vessel and European Service Module for Orion, and the boosters and early work on core stage 

for SLS. In addition, the direction in the FY 2018 appropriations act to build a second ML 

allows NASA the technical and scheduling flexibility to use the SLS Block 1 configuration for 

the first crewed flight on EM-2, rather than Block lB, thereby relieving a significant technical 

and schedule dependency between the two. This allows NASA to extend work on the more 

powerful Block lB variant to a first flight in the 2024 timeframe. NASA (as well as the General 

Accountability Office) is reviewing the integrated schedules for EM-I and EM-2 and will 

provide an updated assessment when this review is complete. With NASA's multi-mission 

approach to deep space exploration, we have hardware in production for the first three missions. 

As teams complete hardware for one flight, they move on to the next set of flights. Extreme 

focus on early flights can be harmful to future missions in a multi-flight program, and focusing 

solely on the first flights ofEM-1 for SLS and EM-2 for Orion can impact the ability to deliver a 

human deep space exploration system for use in the decades to come. The flight test data we 

will collect on EM-I and EM-2 will ensure the success of the exploration campaign in the years 

to come. 

James Webb Space Telescope 

Webb's flight hardware is comprised of two elements. One half of the observatory- the optical 

telescope and science payload is complete and has been tested successfully. The other half of 

the observatory- the sunshield and the spacecraft bus- is complete and ready for testing. 

Earlier this year, the Webb Standing Review Board (SRB) assessed the project's plans for the 

time and cost necessary to complete development, in light of challenges encountered during 

spacecraft and sunshield integration, and additional time needed to integrate these two clements 

into final flight configuration and complete testing. The SRB estimated that, at a 70 percent joint 

cost and schedule confidence level, launch readiness will be approximately May 2020, instead of 

the baseline launch readiness estimate of October 2018. We also implemented leadership 

changes and revised oversight strategy to mitigate issues identified by the SRB and 

recommendations by the upcoming Independent Review Board report. 

Subsequent to the SRB's assessment, NASA established an external Webb Independent Review 

Board (IRB), chaired by Thomas Young, a highly respected NASA and industry veteran who is 

often called on to chair advisory committees and analyze organizational and technical issues. The 

6 
66 

Webb IRB is evaluating all factors, including those identified by the SRB as influencing JWST's 

success, to ensure that NASA's approach to completing Integration and Test (I&T), the launch 

campaign, and the commissioning of the Webb Telescope is appropriate for the Agency's next 

flagship observatory. 

The Webb IRB, convened by NASA's Science Mission Directorate, includes individuals with 

extensive experience in program and project management, schedule and cost management, 

systems engineering, risk management, and the integration and testing oflarge and complex 

space systems, including systems with science instrumentation, unique flight hardware, and 

science objectives similar to Webb. 

The Webb IRB review process will take approximately two months. Once the review concludes, 

the board members will deliver a presentation and final report to NASA providing their 

observations, concerns, findings, and recommendations. NASA will review that feedback along 

with other inputs to determine updates to the remaining JWST development schedule and cost, 

which NASA plans to provide to Congress in a report this summer. 

Conclusion 

We take our responsibilities as stewards oflimited federal resources very seriously and we 

recognize that executing our projects consistent with our baseline cost and schedule 

commitments is critical to the continued support of Congress and our continued success on 

behalf of the American people. Excellence in program and project management is a requirement 

if we are to successfully develop and operate technologies and systems for the human 

exploration of deep space; encourage the creation of a thriving commercial space economy in 

LEO and beyond; execute robust programs of robotic missions to monitor the Sun and Earth, 

explore the planets of our solar system, and observe the universe beyond; and continue to make 

aviation safer, more efficient, and more environmentally friendly. 

Thank you for the invitation to testify before you today, and I look forward to answering any 

questions you may have. 

7 
67 

Mr. Stephen Jurczyk became NASA's associate administrator, the agency's highest-ranking 

civil servant position, effective May, 20J.8. Prior to this assignment he was the associate 

administrator of the Space Technology Mission Directorate, effective since June, 20J.5. In this 

position he formulated and executed the agency's Space Technology programs, focusing on 

developing and demonstrating transformative technologies for human and robotic exploration 

of the solar system in partnership with industry and academia. 

He previously was Director at NASA's Langley Research Center in Hampton, VA. Named to this 

position in May 20J.4, he headed NASA's first field Center, which plays a critical role in NASA's 

aeronautics research, exploration and science missions. Jurczyk served as Langley's Deputy 

Center Director from August 2006 until his appointment as director. 

Jurczyk began his NASA career in 1988 at Langley in the Electronic Systems Branch as a design 

and integration & test engineer developing several space-based Earth remote sensing systems. 

From 2002 to 2004 Jurczyk was director of engineering, and from 2004 to 2006 he was director 

of research and technology at Langley where he led the organizations' contributions to a broad 

range of research, technology and engineering disciplines contributing to all NASA mission 

areas. 

Jurczyk is a graduate of the University of Virginia where he received Bachelor of Science and 

Master of Science degrees in Electrical Engineering in J.984 and J.g86. He currently lives in 

Fredericksburg, Va. with his wife Ann. They have two adult daughters. 
68 

Chairman BABIN. Thank you, Mr. Jurczyk. 

I would like to now recognize Mr. Martin for five minutes to 

present his testimony. 

TESTIMONY OF MR. PAUL MARTIN, 

INSPECTOR GENERAL, NASA 

Mr. MARTIN. Thank you, sir. 

Chairman BABIN. Yes, sir. 

Mr. MARTIN. Members of the Subcommittee, over its 60-year history, NASA has been responsible for numerous scientific discoveries 

and technological innovations. However, many of NASA’s largest 

projects cost significantly more to complete and take much longer 

to launch than originally planned. 

Our office has examined NASA’s successes and failures in project 

management by examining the long-standing challenges the agency 

has faced in meeting cost, schedule, and performance objectives, as 

well as the tools it has developed to address these shortcomings. 

We identified four factors that present the greatest challenges to 

successful project outcomes: one, NASA’s culture of optimism; two, 

underestimating technical complexity; three, funding instability; 

and four, development of new project managers. My remarks this 

morning address the first two of these challenges, optimism. 

Optimism exemplified by the agency’s greatest achievement, 

landing humans on the Moon and safely returning them to Earth, 

NASA’s ability to overcome obstacles has become part of its can-do 

culture. However, our work has shown that this attitude contributes to development of unrealistic plans and performance baselines, 

particularly with respect to its largest projects. 

And technological success, often at a significantly greater cost 

than originally estimated, tends to reaffirm a mindset that project 

cost and adherence to schedule are secondary concerns. In fact, several people offered a name for this phenomenon, calling it the 

‘‘Hubble psychology’’ or an expectation that projects that fail to 

meet initial cost and schedule goals will receive additional funding 

and that subsequent scientific success will overshadow budget and 

schedule problems. 

The Hubble Space Telescope was two years late and about $1 billion more than initial estimates, but most people don’t remember 

that. Instead, they rightfully remember its stupendous images of 

the universe. While a few projects in NASA’s recent past have been 

canceled because of poor cost and schedule performance, a too-bigto-fail mentality pervades agency thinking when it comes to 

NASA’s larger and most important missions. While understandable 

given the investment of agency resources, cost overruns in these 

projects can result in delays to other missions as funding is 

reprioritized. 

Technical complexity: The technical complexity inherent in 

NASA projects remains a major challenge to achieving cost and 

schedule goals, with project managers attempting to predict the 

amount of time and the amount of money needed to develop oneof-a-kind and first-of-their-kind technologies. We found that NASA 

historically has underestimated the level of effort needed to develop, mature, and integrate such technologies. 
69 

To help project managers avoid cost and schedule overruns, 

NASA has implemented a number of initiatives. I highlight two 

this morning. JCL: Required since 2009 for all NASA projects with 

lifecycle costs exceeding $250 million, a JCL analysis calculates the 

likelihood a project will achieve its objectives within budget and on 

time. The process uses software models that combine cost, schedule, risk, and uncertainty to evaluate how expected threats and unexpected events may affect a project’s cost and schedule. Our examination of NASA’s use of JCL found mixed success with the tool unevenly applied across agency projects. 

Contracting: NASA makes use of multiple procurement vehicles 

for its projects, including fixed-price and cost-reimbursement contracts, as well as funded Space Act Agreements used to spur development of commercial cargo and crew capabilities. As NASA looks 

increasingly to the private sector to leverage its resources, it must 

ensure that the contracting mechanisms it chooses are best suited 

to maximize the agency’s significant investments. 

In sum, to meet cost and schedule goals, agency leaders must 

temper NASA’s historic culture of optimism by demanding more realistic cost and schedule estimates, well-defined and stable requirements, and mature technologies early in project development. In 

addition, Congress and NASA managers must ensure that funding 

is adequate and properly phased. 

Finally, the agency must be willing to take remedial action up 

to and including termination when these critical project elements 

are not present. In our judgment, meeting these project-related 

challenges can only be accomplished through leadership that articulates a clear, unified, and sustaining vision for NASA and provides the necessary resources to execute that vision. Thank you, 

sir. 

[The prepared statement of Mr. Martin follows:] 
70 

Office of Inspector General 

Testimony before the House of Representatives 

Subcommittee on Space, Committee on Science, 

Space, and Technology 

NASA COST AND SCHEDULE 

OVERRUNS: ACQUISITIONS AND 

PROGRAM MANAGEMENT 

CHALLENGES 

Statement of Paul K. Martin 

Inspector General 

National Aeronautics and Space Administration 

For Release on Delivery (expected at 10:00 a.m.) 

June 14, 2018 
71 

Chairman Babin, Ranking Member Sera, and Members of the Subcommittee: 

The Office of Inspector General (OIG) is committed to providing independent, aggressive, and objective 

oversight of NASA programs and projects, and we welcome this opportunity to discuss the Agency's 

challenges in meeting project cost, schedule, and performance goals. 

Throughout its 60-year history, NASA has been at the forefront of aeronautics, science, and space 

exploration, responsible for numerous scientific discoveries and technological innovations. However, 

many of NASA's largest projects cost significantly more to complete and take much longer to launch 

than originally planned. Finding ways to better manage its projects- many of which are one-of-a-kind 

and first-of-their-kind- remains an ongoing challenge for the Agency. 

Over the past 8 years, our office has examined NASA's successes and failures in project management on 

two levels: first, by examining the historic challenges the Agency faces in meeting cost, schedule, and 

performance objectives and the processes it has developed to address these shortcomings. Second, by 

assessing the effectiveness of NASA's use of these project management tools through dozens of audits 

of discrete projects, including development of science satellites such as the Surface Water and Ocean 

Topography (SWOT} mission, rover missions to Mars, construction of rocket test facilities, human space 

flight vehicles such as the Space Launch System (SLS) rocket and Orion crew capsule, and aeronautics 

research to integrate unmanned aerial vehicles in the national airspace. My testimony today is informed 

by the findings and recommendations of these OIG reports. 

NASA's Historic Challenges to Meeting Cost, Schedule, and 

Performance Goals 

NASA's storied history evidences a unique agency with spectacular accomplishments. For example, 

since its launch in 1990 the Hubble Space Telescope (Hubble) has helped scientists determine the age of 

the universe, identify quasars, and prove the existence of dark energy. Hubble's successor, the James 

Webb Space Telescope (JWST), will study the birth and evolution of galaxies while the Mars Science 

Laboratory (MSL), which successfully landed its Curiosity rover in August 2012, produced last week's 

blockbuster announcement of the presence of organic molecules and methane- important clues into 

whether the Red Planet is or has ever been able to support life. 

Unfortunately, in addition to their scientific accomplishments these projects and many others at NASA 

share another less positive trait- significant cost and schedule overruns. For example, in 1977 NASA 

estimated that it would complete development of Hubble by 1983 at a total cost of $200 million; 

however, the telescope was not completed unti12 years later at a cost of approximately $1.2 billion. 

And even when launched, a flaw in its mirror required multiple repair and servicing missions that, while 

successful, added billions of dollars to the project's overall cost. MSL also launched 2 years behind 

schedule with development costs that increased 83 percent from $969 million to $1.77 billion. In 2009, 

NASA estimated JWST would cost $2.6 billion to develop and launch in 2014; however, its price tag now 

exceeds $8 billion and its launch date has slipped to approximately May 2020. 

Our office's foundational examination of NASA's project management challenges identified four factors 

that present the greatest challenges to successful project outcomes: NASA's culture of optimism, 

NASA Office oflnspector General l1 
72 

underestimating technical complexity, funding instability, and development and retention of new and 

experienced project managers.' 

Culture of Optimism. Exemplified by the Agency's greatest achievement -landing humans on the moon 

and safely returning them to Earth- NASA's ability to overcome technological and scientific obstacles to 

accomplish a given objective has become part of the Agency's culture and has helped foster a belief that 

NASA can accomplish anything. Indeed, it was this "can-do attitude" that enabled NASA to bring the 

ailing Apollo 13 safely back to Earth, find a way to fix Hubble's flawed mirror in orbit, and land the 

Curiosity rover on Mars using a supersonic parachute/sky crane combination. However, our past work 

has found that this outlook causes NASA to view the success of projects primarily in technical rather 

than cost and schedule terms. More specifically, NASA's at times overly optimistic culture contributes to 

development of unrealistic plans and performance baselines, particularly with respect to its largest 

programs and projects. Subsequent technological success- at a significantly greater cost than originally 

estimated- reaffirms a mindset that project costs and adherence to schedule are secondary 

considerations to achieving operational success. In fact, many people we interviewed raised the 

"Hubble Psychology"- an expectation among Agency personnel that projects that fail to meet initial 

cost and schedule goals will receive additional funding and subsequent scientific and technological 

success will overshadow budgetary and schedule problems. 

Our work over the past 8 years has identified three related ways excessive optimism can create cost and 

schedule challenges: 

1. measures of project success do not include cost and schedule factors, 

2. establishment of unrealistic cost and schedule baselines, and 

3. an expectation that additional funding will be made available if a project runs "short." 

In addition, NASA project managers are often overly optimistic about the effort required to mature 

critical technologies and frequently underestimate the cost and schedule reserves needed to address 

known and unknown risks, optimistically assuming that most risks will not materialize. However, when 

they do they result in significant cost, schedule, and performance problems. 

Lastly, many project managers admitted to an expectation that projects that fail to meet initial cost and 

schedule goals, especially the larger projects, will receive additional funding and that subsequent 

scientific and technological success wilt overshadow budgetary and schedule problems. Past examples 

of this phenomena include Hubble, while current examples include JWST, the Orion crew capsule, and 

the SLS rocket. Although a few projects in NASA's recent past were cancelled because of poor cost and 

schedule performance, a "too big to fail" mentality pervades Agency thinking when it comes to NASA's 

larger and most important missions. While understandable given the heavy investment of Agency 

resources, these cost overruns can result in delays to other NASA missions as funding is reprioritized. 

Underestimating Technical Complexity. The technical complexity inherent in NASA projects remains a 

major challenge to achieving cost and schedule goals, with project managers attempting to predict the 

amount of time and money needed to develop one-of-a-kind, first-of-their-kind technologies, 

instruments, and spacecraft. NASA historically has underestimated the level of effort needed to 

1 NASA OIG, "NASA's Challenges to Meeting Cost, Schedule, and Performance Goals" {IG-12-021, September 27, 2012), For this 

review, we interviewed 85 individuals including the NASA Administrator, Deputy Administrator, Associate Administrators, 

Center Directors, project managers, project staff, former NASA Administrators and staff, and external parties. 

NASA Office oflnspector General jz 
73 

develop, mature, and integrate these technologies, as well as account for the extensive pre-launch 

testing required to reduce risk and increase the likelihood that the technologies will operate as designed 

in space. 

Our work has shown that NASA can take several actions to mitigate this challenge. First, projects need 

to mature critical technologies early in the project life cycle, preferably before establishing their baseline 

cost and schedule. Establishing the level of effort needed to incorporate the technology in an 

operational system reduces risk and provides greater transparency at the project's "buy-in" point for 

decision makers.2 Second, the amount and availability of reserves needs to be commensurate with a 

project's technical risk to cover expenses associated with work managers did not plan for at the 

beginning of the project but almost inevitably will need due to the complexities inherent in developing 

space flight projects. lastly, managers need to control project scope and requirements "creep" that can 

occur when engineers, scientists, or other advocates suggest functionalities greater than the 

instrument's original requirements to increase its technical capabilities. 

Funding Instability. Funding instability includes situations in which a project receives less money than 

planned or when funds are disbursed on a schedule different than planned. Such instability results from 

congressional or Agency-directed actions and can require deferring critical tasks to later phases of 

development or de-scoping or discontinuing lower priority tasks to keep project costs within a revised 

budget profile, leading to cost increases and schedule delays. To this point, since 1959 NASA has 

received its annual appropriation at the start of a fiscal year only seven times, often resulting in weeksor months-long continuing resolutions (CR) that generally set funding at the prior year's level. The 

current fiscal year is a striking illustration of this phenomena: five CRs were required before NASA (and 

the rest of the Federal Government) received its annual appropriation- at the half-year mark. 

Development and Retention of Experienced Project Managers. We also identified a number of issues 

related to developing project managers' experience that could affect NASA's ability to manage its 

projects effectively in the future. First, most project managers and senior officials we spoke with said 

that experience and on-the-job training were keys to a project manager's ability to manage cost, 

schedule, and performance goals. In that regard, managers described NASA's small projects as 

invaluable for developing management skills and learning the key elements of project management, 

including making appropriate trade-offs among cost, schedule, and performance goals when necessary. 

To that end, they said it was vital that NASA maintain a balanced portfolio that continues to provide 

these learning opportunities. 

Interviewees also expressed concern about a lack of in-house development opportunities, with some 

expressing the view that as NASA has increasingly relied on contractors to support project development, 

the Agency's in-house capabilities have declined. Moreover, they expressed concern that because NASA 

contracts the majority of its hardware and software development efforts to private industry, Agency 

engineers spend most of their time overseeing contractor efforts rather than building spaceflight 

components, thereby limiting opportunities for NASA engineers to gain practical "hands-on" experience. 

Finally, interviewees raised concerns that NASA will not be able to attract and retain recent graduates or 

experienced engineers seeking opportunities to design and build spaceflight systems. Instead, these 

2 In an address to the American Astronautical Society Goddard Symposium in March 2008, former NASA Administrator 

Michael Griffin described the problem this way: ''[T]here have been many instances where proponents of individual missions 

have downplayed the technical difficulty and risk of their individual mission, or grossly underestimated the cost and effort 

involved to solve the problems, in order to gain 'new start' funds for [a] particular project. Everyone knows that, once 

started, any given mission is nearly impossible to cancel, so the goal becomes that of getting started, no matter what has to 

be said or done to accomplish it." 

NASA Office of Inspector General 13 
74 

individuals may choose positions in private industry and as a result, NASA will lose core competencies as 

experienced Agency engineers retire. 

Efforts to Address Project Cost and Schedule Growth 

NASA has implemented a number of initiatives over the years with mixed success to help project 

managers avoid cost and schedule overruns. 

Joint Cost and Schedule Confidence level (JCL). Beginning in 2006, NASA incorporated progressively 

more sophisticated cost and schedule estimating techniques into Agency policy, culminating in 2009 

with formal adoption of a JCL requirement for projects with life-cycle costs greater than $250 million. A 

JCL analysis, completed during the final portion of the project's formulation phase and required as part 

of the Agency's decision to move the project into the implementation phase, calculates the likelihood a 

project will achieve its objectives within budget and on time. A properly executed JCL not only provides 

a percentage likelihood the project will be developed at a particular cost and on a particular schedule, 

but also identifies associated cost and schedule reserves needed to back-up the plan. Unless senior 

management approves an exception, projects are funded at a minimum of the 50 percent confidence 

level (the Management Agreement) and budgeted at the 70 percent confidence level (the Agency 

Baseline Commitment or external commitment)- the difference between the two figures being the 

reserves. 

The JCL process uses software models that combine cost, schedule, risk, and uncertainty to evaluate 

how expected threats and unexpected events may affect a project's cost and schedule and help 

managers' assess whether a project has an executable plan moving forward. To generate this data, 

project managers develop comprehensive project plans, inputs, and priorities that integrate costs, 

schedules, risks, and uncertainties. NASA officials believe gathering this data encourages better 

communication among project personnel; improves cost, schedule, risk, and uncertainty analyses; and 

fosters an understanding of how different project elements impact one another. 

However, as we wrote in a September 2015 report, the JCL is not a one-stop solution for ending cost 

overruns and schedule delays.3 Rather, we found the process was unevenly applied across various 

projects and has inherent limitations in that it does not fully address the issue of predicting 

"unknown/unknowns" or other root causes of NASA's project management challenges such as funding 

instability and underestimation of technical complexity. Moreover, we found that while success when 

using this process relies on the expertise of risk managers, cost estimators, and schedulers, NASA had a 

shortage of people with this experience. Furthermore, although NASA policy requires JCL calculations to 

include consideration of all risks whether or not funded by the project, we found that NASA routinely 

leaves out risks "external" to the project such as involvement of international partners and risks 

associated with selection and timely delivery of launch vehicles. While NASA has embraced JCL and 

implemented it across its space flight project portfolio, applying lessons learned from successful projects 

and enhancing training on its use will increase its value as a project management tool. 

Contracting. NASA has multiple contracting mechanisms available for acquiring goods and services, 

including fixed-price and cost-reimbursement contracts. In a fixed-price contract, the contractor agrees 

to deliver a product or service at a price not to exceed an agreed-upon amount. Fixed-price contracts 

are generally used when costs and risks can be clearly defined- for example, when purchasing 

commercially available items such as laptop computers. In contrast, under cost-reimbursement 

3 NASA OIG, "Audit of NASA's Joint Cost and Schedule Confidence level Process" (!G~lS-024, September 29, 2015}. 

NASA Office of Inspector General 14 
75 

contracts NASA agrees to pay all allowable costs the contractor incurs in delivering the service or 

product. Cost-reimbursement contracts involve increased risk for the Government and are generally 

more appropriate when it is difficult to accurately estimate specific costs in advance. Given the nature 

of the projects developed at NASA, cost-reimbursement contracts are very common at the Agency. 

Contracts may also include incentives in which a predetermined amount of money is set aside for the 

contractor to earn above the contract's base price based on performance. Properly structured and 

executed, incentive contracts can reduce the risk of cost overruns, delays, and performance failures by 

providing a well-performing contractor the opportunity to earn additional money. 

NASA has also used its "other transactions" authority provided by the National Aeronautics and Space 

Act of 1958 for large-scale development projects, most significantly to encourage development of 

commercial cargo and crew delivery capabilities to resupply the International Space Station (ISS or 

Station).' Under these Space Act Agreements, NASA agrees to provide funding, goods, services, 

facilities, or equipment that the partner uses to accomplish stated objectives. In return, the partner 

may advance technologies that support NASA's mission, share information, or reimburse NASA for the 

support provided. With respect to the development of commercial cargo and crew services, contractors 

were required to commit significant amounts of their own funds while NASA paid the companies when 

they met predetermined milestones. While providing financial benefits to the Agency, the use of funded 

Space Act Agreements decreases the level of NASA oversight and control compared to traditional 

procurement contracts. 

Regardless of approach, our work has highlighted multiple examples of contracting costs, benefits, and 

challenges at NASA. Since 2011, we have issued eight reports examining acquisition strategies used by 

NASA for commercial cargo and crew transportation services to access the ISS. While NASA's costs to 

develop these services using Space Act Agreements are generally perceived as significantly less than if 

the Agency had used traditional contracting mechanisms, cargo services still were not provided until 

3 years later than planned and crew services have yet to be demonstrated and are 3 years beyond initial 

expectations. Furthermore, several of our reports identify specific issues in NASA's commercial cargo 

contracts where it could save money by modifying contract terms and agreements. 

Likewise, a November 2013 OIG report examined NASA's use of award-fee incentive contracts and 

questioned its methodology for motivating and incentivizing contractors' performance.' In particular, 

we found that overly complex award-fee formulas and a contract clause designed to hold contractors 

accountable for the quality of the final product that disregards interim performance evaluations have 

diminished the effectiveness ofthe Agency's award-fee contracts. For example, if JWST produces the 

science expected after its eventual launch, the Agency has the ability under the contract to award the 

contractor all of the award fees it could have earned over the past 15 years- even though NASA 

previously denied payment of some of those fees due to poor contractor performance. 

Finally, a May 2017 report detailed how fixed-price contract costs increased on NASA's construction of 

two test stands at Marshall Space Flight Center that will be used to test SLS components. 6 Because the 

stand designs were based on preliminary specifications from the SLS program, the requirements and 

capabilities needed were not fully understood when the construction contract was awarded. 

'51 U.S. C. § 20113(e), "National Aeronautics and Space Act of 1958" (2010). 

5 NASA OIG, "NASA's Use of Award-fee Contracts" (IG-14-003, November 19, 2013). 

6 NASA OIG, "Construction of Test Stands 4693 and 4697 at Marshall Space Flight Center" (IG-17-021, May 17, 2017). 

NASA Office oflnspector General is 
76 

Subsequently, NASA was required to modify the contract to meet changing requirements, added extra 

features, and made other modifications that raised the contract price by $20.3 million. Further, NASA 

did not establish adequate funding reserves to cover these changes and therefore had to secure $35.5 

million in additional funding over the planned budget. 

As NASA increasingly relies on the private sector to leverage its capacity, innovation, and 

competitiveness, the Agency must ensure that the contracting mechanisms it chooses are best suited to 

maximize its significant investments. 

Partnerships. Partnerships, both domestic and international, are playing an increasingly important role 

in NASA's programs and projects. These collaborations can reduce NASA's required investment through 

sharing of capabilities, expertise, and scientific research while cultivating positive working relations 

among nations. As NASA missions become more complex and costly, it will be difficult for the Agency to 

achieve its ambitious goals at current funding levels without leveraging such partnerships, particularly 

for human exploration beyond low Earth orbit. 

While NASA currently manages more than 750 international agreements with 125 different countries, it 

faces challenges in maintaining or expanding its use of such partnerships. For example, a May 2016 OIG 

audit found NASA sometimes experienced difficulty gaining agreement approval from the Department 

of State, as well as overcoming cumbersome U.S. export control regulations, restrictions on NASA 

employees' attendance at international conferences, and geopolitical realities that limit expansion of 

such partnerships, particularly with the Russian and Chinese space agencies.' 

That said, international partnerships come with their own challenges. For example, in September 2016 

we reported on likely launch schedule delays for Orion due to the European Space Agency's late delivery 

of the European Service Module needed for Exploration Mission 1.8 More recently, our work in January 

of this year noted that the SWOT mission is dependent on about $400 million in instruments and other 

contributions from the French and Canadian space agencies- contributions critical to mission success? 

Unfortunately, the French contribution is late and has forced project management to delay completion 

of a major life-cycle review that could potentially impact the launch schedule. 

Looking toward the future, NASA hopes to leverage the emerging commercial spaceflight industry by 

forming public-private partnerships to further its space exploration and science research goals, 

particularly with respect to operation of the Station. According to NASA, such public-private 

partnerships will enable it to share the financial risk with private industry to better leverage 

Government investments. 

Conclusion 

NASA should rightly be proud of its six decades of significant achievements exploring space, helping 

understand the Earth and other planets' evolution and environment, and conducting fundamental 

research in aeronautics. However, consistently managing the Agency's largest science and space 

exploration projects to meet cost, schedule, and performance goals remains elusive. 

7 NASA OIG, "NASA's International Partnerships: Capabilities, Benefits, and Challenges" (IG~16~020, May 5, 2016). 

8 NASA OIG, "NASA's Management of the Orion Multi-Purpose Crew Vehicle Program" (!G-16-029, September 6, 2016}. 

9 NASA OIG, "NASA's Surface Water and Ocean Topography Mission" (IG-18-011, January 17, 2018). 

NASAOfficeoflnspectorGeneratl6 
77 

Our work has shown that Agency leaders and stakeholders must temper NASA's historic culture of 

optimism by demanding realistic cost and schedule estimates, well-defined and stable requirements, 

and mature technologies early in project development. In addition, they must ensure that funding is 

adequate and properly phased and that known funding risks are identified and accounted for in 

mitigation strategies. Finally, they must be willing to take remedial action- up to and including 

termination- when these critical project elements are not present. 

In our judgment, meeting these challenges can only be accomplished through a "unity of effort" that 

includes strong, consistent, and sustained leadership by the President, Congress, and NASA 

management. Articulating a clear, unified, and sustaining vision for the Agency and providing the 

necessary resources to execute that vision is critical to ensuring that project managers are best 

positioned to complete projects within cost and on schedule. 

NASA Office of Inspector General j7 
78 

Paul K. Martin 

NASA Inspector General 

Paul K. Martin was confirmed by the United States Senate as 

NASA Inspector General on Nov. 20, 2009. 

Prior to his NASA appointment, Martin served as the Deputy 

Inspector General at the U.S. Department of Justice, Office of 

the Inspector General (OIG). In that capacity, he assisted the 

Inspector General in managing the audit. inspection and 

investigative activities of the office's 425 employees. From 

2001 to 2003, he served as Counselor to the Inspector 

General, and from 1998 to 2001 he served as Special 

Counsel to the Inspector General. 

Before joining the Department of Justice OIG, Martin spent 13 

years at the U.S. Sentencing Commission in a variety of 

!po:sitl<>ns. including 6 years as the Commission's Deputy Staff 

Director. Martin was one of the Sentencing Commission's first employees when the 

agency was created in 1985, and helped develop the first set of federal sentencing 

guidelines. 

Martin began his professional career as a reporter with The Greenville News, a daily 

newspaper in Greenville, SC. He holds a B.A. in Journalism from The Pennsylvania 

State University and a Juris Doctor from The Georgetown University Law Center. 

Martin is married to Rebekah Liu, an attorney working in Washington, DC. A native of 

Pittsburgh, PA, he and his wife have three daughters. 
79 

Chairman BABIN. Thank you very much, Mr. Martin. 

Now, I’d like to recognize Mr. Dumbacher for five minutes to 

present his testimony. 

TESTIMONY OF MR. DANIEL L. DUMBACHER, 

EXECUTIVE DIRECTOR, 

AMERICAN INSTITUTE OF AERONAUTICS 

AND ASTRONAUTICS (AIAA) 

Mr. DUMBACHER. Chairman Babin, Ranking Member Bera, and 

distinguished Members of the Committee and Subcommittee—— 

Chairman BABIN. You may want to push your button there. I’m 

sorry. Yes. 

Mr. DUMBACHER. Chairman Babin, Ranking Member Bera, and 

distinguished Members of the Subcommittee, thank you for this opportunity to address you today. Your support for the nation’s space 

program is to be commended. 

I sit before you as a former NASA Program Manager, former educator, and as the current Executive Director of the world’s largest 

aerospace professional society. 

Let me first say that the work NASA employees and its industry 

partners do is purposely challenging. The NASA industry teams 

should be commended for their accomplishments under such tight 

constraints. Programs are complex, and a great deal of planning 

and commitment is necessary to execute a successful mission. 

Every program has its unique challenges. The NASA industry 

team works hard to address these issues, develop solutions, and incrementally make progress towards the respective missions. No 

matter how much planning takes place or how well-thought-out the 

plan, it’s difficult to estimate the cost and schedules of these complex one-of-a-kind projects. 

All federal government departments and agencies are operating 

in a time of heightened fiscal responsibility and accountability. Accordingly, NASA has updated policies and guidance to focus on formulation and implementation with robust cost-estimating; well-defined baselines, designs, and risk postures at key decision points; 

and formal requirements and guidance. 

Especially during the implementation phases of its projects, 

NASA has processes to ensure that rigorous cost assessment is performed. Program progress is tracked through the periodic performance review process. Since NASA instituted its joint confidence 

level policy nearly a decade ago, NASA’s cost and schedule performance has improved. 

From my perspective, the issues experienced in the NASA 

projects can be assessed in two categories: one, the need for stable, 

predictable, and consistent funding; and workforce development. 

Simply stated, project management has three basic knobs: content, 

schedule, and cost. A change in any one of these three variables directly affects the other two. 

Cost and schedule issues do arise when there are unanticipated 

changes to a program or when development challenges arise, particularly during first-time production and when technical capability 

is being pushed. Disruptions to the budget process and funding 

stream, along with major policy and priority shifts, affect schedules 

and contracts and ultimately lead to additional cost. It is also quite 
80 

difficult for NASA to plan and implement programs without sufficient resources or reserves. 

A key issue is projects developed under a flatline budget. A 

flatline budget requires project managers to realign the work as 

they go to stay under the budget cap, resulting in hard priority decisions and inefficiencies that explicitly break the program linkages 

across schedule and budget. These circumstances can and do add 

to program cost to move schedules to the right. We learned this lesson with the International Space Station and yet now we’re repeating it with SLS and Orion. 

The current budgeting process, including the regular use of continuing resolutions, late-year appropriations, and threats of government shutdowns result in endless multiple planning scenarios. As 

stated in October 2015 testimony before this Subcommittee, the 

need to constantly have backup plans for various potential appropriations outcomes, different budget planning levels, along with 

flexible workforce blueprints invites confusion and 

miscommunication. 

A related issue is the inability of NASA to include appropriate 

budget and schedule margin in its program planning due to externally imposed constraints. Planned margin is difficult to include 

because it becomes the first target for budget reduction in the 

budget and appropriations process. 

A separate but related issue that must be addressed is the workforce challenge impacting the aerospace community as a whole. 

There remains a nationwide shortage of workers for jobs requiring 

science, technology, engineering, arts, and mathematics. According 

to Aviation Week’s 2017 workforce study, nearly 30 percent of the 

nation’s aerospace and defense workforce are over the age of 55, 

and 22 percent are younger than 35. 

More concerning is the lack of development program experience. 

The vast majority of the NASA human spaceflight workforce has 

been hired and trained after space shuttle development. Space station development has provided on-orbit expertise. However, launch 

system development experience is minimal. NASA expertise that 

developed the space shuttle has mostly retired or passed away. 

For the United States to continue its long-held space exploration 

leadership, significant investments must be made in addressing the 

workforce development via hands-on real-world hardware programs 

and research. Key technical challenges for the future of space exploration such as new propulsion, on-orbit assembly, and human 

survival in microgravity should be addressed. Such investments 

would meet key research and engineering needs, while providing 

valuable experience. A well-developed leadership bench is also necessary for a program’s mission success. This ensures the appropriate expertise to assess and balance risk and priorities. 

In conclusion, I thank this Committee for the opportunity to talk 

today and look forward to your questions. 

[The prepared statement of Mr. Dumbacher follows:] 
81 

Shaping the Future of Aerospace 

Written Statement of 

Mr. Daniell. Dumbacher 

Executive Director 

American Institute of Aeronautics and Astronautics 

Subcommittee on Space 

Committee on Science, Space, and Technology 

United States House of Representatives 

"NASA's Cost and Schedule Overruns: Acquisitions and 

Program Management Challenges" 

June 14, 2018 

Chairman Babin, Ranking Member Bera, and distinguished members of the Subcommittee, I 

want to thank you for the opportunity to address you today as you consider recommendations 

to help minimize challenges that lead to increased costs and schedule on NASA programs. I sit 

before you as a former NASA program manager, a former educator, and as the current 

executive director of the world's largest aerospace professional society, the American Institute 

of Aeronautics and Astronautics. Over the span of my career I have led several of these major 

NASA programs and I have helped educate and prepare our nation's future aerospace 

workforce. 

1 
82 

Let me first say that the work NASA employees and its industry partners do is challenging. The 

NASA/Industry team should be commended for their accomplishments under tight constraints. 

The programs are complex, and a great deal of planning and commitment are necessary to 

execute a successful mission. Every program has its unique challenges and setbacks, but NASA 

works hard to address these issues, develop solutions, and incrementally make progress toward 

achieving the respective missions. No matter how much planning takes place, or how well 

thought out the plan, it is difficult to estimate the costs and schedules of these complex 

projects. This is especially the case for the larger projects such as the Space launch System 

(SLS), the Orion spacecraft, and the James Webb Space Telescope. For these programs, even 

when using the soundest estimating tools based on applicable past experience, it is extremely 

challenging, in part because each first-time development is unique. 

All federal government departments and agencies are operating in a time of heightened fiscal 

responsibility and accountability. Accordingly, NASA has updated policies and guidance to focus 

on (1) program formulation and implementation with robust cost estimating, including cost 

estimates and the approach, (2) well-defined baselines, designs, and risk postures at key 

decision points, and (3) authoritative requirements and guidance with emphasis on formal 

(decision) documentation. Especially during the implementation phases of its projects, NASA 

has processes to ensure that rigorous cost assessment is performed and program progress is 

well understood by enhancing the periodic performance review process and by providing 

support to projects when cost, schedule, and/or technical performance is in question. NASA has 

shifted its operational paradigm to better balance technical requirements with the 

establishment of adequate cost, schedule, and technical baselines, and during execution by 

addressing poor performance to avoid collateral impact to other missions. Since NASA 

instituted its Joint Cost and Schedule Confidence level, or JCL, policy nearly a decade ago to 

understand and assess program risks impacting cost and schedule, NASA's cost and schedule 

performance has improved ... significantly. NASA should be lauded for moving cost growth 

against established baselines from 45 percent on average, pre-JCL, to less than 2 percent since 

instituting the JCl process. 

From my perspective, the issues experienced in the NASA projects can be assessed in basically 

two categories. These categories are (1) the need for stable and consistent funding, and (2) 

workforce development. I will address these below. 

2 
83 

Stable and Consistent Funding 

In a simplified perspective, project management has three basic "knobs" -content, schedule, 

and cost. A change in any one of these variables directly affects the other two variables. 

Cost and schedule issues do arise when there are unanticipated changes to a program or when 

development challenges arise, particularly during first-time production and when technical 

capability is being pushed. Disruptions to the budget process and funding stream, along with 

major policy and priority shifts, affect schedules and contracts and ultimately lead to additional 

costs. This is especially problematic for large projects that require long-term investments and 

long-term life cycles. It is also quite difficult for NASA to plan and implement programs without 

sufficient resources or reserves. While the agency receives approximately 5/lOths of a penny 

for every tax dollar, the number, breadth, and complexity of programs continues to increase. 

NASA also operates within the confines of administration policy shifts and the economic market 

conditions. Overall, aerospace, and increasingly commercial supply chains, are affected by 

external policy and economic conditions. 

A key issue is how certain projects are developed under a flat-line budget that does not account 

for the needed project life-cycle growth for detailed design and test. Perhaps even more 

important, a flat-line budget does not provide program managers with the ability to address 

design and operational changes required both before and after testing and also with system 

integration. In fact, a flat-line budget requires project managers to realign the work as they go 

to stay under the budget cap, resulting in hard priority decisions and inefficiencies that 

explicitly break the linkages across schedules and budget allocations within a program. These 

circumstances can, and do, add to program costs and move schedules to the right. 

We learned this lesson with the International Space Station (ISS) and yet, now we are repeating 

it with the SLS and Orion. Moreover, at various points these fiscal limitations have also led to 

contractor layoffs, which negatively impact the base of knowledge and experience available to 

draw from in future programs. 

The current budgeting process, including the regular use of continuing resolutions, late year 

appropriations, and threats of government shutdowns, results in endless, multiple planning 

scenarios. Such irregularities lead to inefficiencies in planning and technical execution. It is 

extremely challenging for NASA and its industry partners to resolve complex technical issues, 

hold schedules, and predict accurate flight dates when the budget is constantly in flux. 

Although budget increases in recent years have helped to increase margin in the programs, 

additional funding, outside of the normal planning cycle, can create inefficient spending profiles 

because there is little time to integrate a changed funding profile even when the change is a 

3 
84 

positive one- into program planning. As I stated in my October 2015 testimony before this 

subcommittee, the need to constantly have backup plans for each potential appropriations 

outcome, different budget planning levels, along with flexible workforce blueprints, all but 

invites confusion and miscommunication. In a program such as SLS these inefficiencies can and 

do result in significant cost to the taxpayer that occurs simply because of disruptions to the 

planning process caused by external factors such as the ones I have described. 

A related issue is the inability of NASA to include appropriate budget and schedule margins in 

its program planning because of externally imposed constraints. like the imposed flat- line 

budgets, planned margin is difficult to include because it becomes the first target for budget 

reduction in the Executive Branch budget and congressional appropriations processes. The May 

2018 Government Accountability Office (GAO) report discusses the Goddard Space Flight 

Center margin requirements. This is done for the small missions; however, in the large-scale, 

higher visibility programs, planned margin becomes the victim of the budget negotiation 

process. I must point out that even the smaller missions have difficulty in protecting the 

schedule and cost margins in the budget process. 

Workforce Development 

A separate, but related, issue that must be addressed is the workforce challenges impacting not 

only NASA but the aerospace community as a whole. There remains a nationwide shortage of 

workers for jobs requiring skills in science, technology, engineering, arts, and mathematics 

(STEAM). These workers form the backbone of an aerospace and defense (A&D) industrial base 

that the United States and its allies count on to ensure and sustain innovation, economic 

growth, global competitiveness, and security. According to Aviation Week & Space Technology's 

2017 Aerospace & Defense Workforce Study, nearly 30 percent of the nation's A&D workforce 

is over the age of 55, and 22 percent are younger than 35. The percentages of ethnic minorities 

and women working in A&D, at less than 25 percent, have not changed significantly in four 

decades despite a major shift in the demographics of the United States. Additionally, only 16 

percent of 12th graders are proficient in math and have expressed interest in a STEAM-related 

career. 

More specific to NASA, the GAO cites that 56 percent of NASA's workforce is 50 years of age or 

older. More experienced employees have retired, passed away, or moved on to other 

endeavors. Others have stayed several years past their initial retirement eligibility date. 

Unfortunately, there is a shortage of highly trained technical graduates to fill the skills gap, and 

many young professionals are inadequately prepared in cross-functional skills. More 

concerning, they lack development program experience. The vast majority of the NASA human 

4 
85 

spaceflight workforce has been hired and trained after Space Shuttle development. ISS 

development has provided on-orbit expertise; however, launch system development 

experience is minimal. NASA expertise that developed the Space Shuttle has retired or passed 

away. 

Many young professionals are also electing to leave NASA or the sector altogether for other 

high-tech jobs. This is sometimes the result of program layoffs, but, according to Aviation 

Week, it really comes down to job satisfaction, which includes challenging work; access to tools, 

learning, and technology; and being part of an organization that encourages innovation in 

technology, processes, and business. 

For the United States to continue its long-held space exploration leadership in the world, 

significant investments need to be made in addressing the workforce development via handson real hardware programs and research. Key technical challenges for the future of space 

exploration such as nuclear propulsion, on-orbit assembly, human survival in microgravity, and 

propellant depots need to be addressed. Such investments would meet key research and 

engineering needs while providing valuable experience for the future workforce. 

NASA should proactively, with administration and congressional support, establish key metrics 

for doing in-house work and assess use of its capabilities as space privatization continues to 

grow. The Goddard Space Flight Center model of 10 percent in-house effort is a prime example. 

Use of the unique NASA test facilities and workforce expertise for common testing and 

assessment of commercial space systems and products will ensure standard program 

performance, safety and reliability, and, if done right, will save private industry from the large 

investments. 

Workforce diversity is absolutely essential as well. The future complex problems demand the 

inclusion of all perspectives for innovative AND relevant solutions. Moreover, we must continue 

to welcome highly skilled, non-U.S. citizens who wish to be educated and trained at our top 

institutions and retain those talented individuals who want to work alongside U.S.-born 

colleagues to contribute to the advancement of our sector. Collectively this workforce drives 

economic growth, innovation, and the entrepreneurial spirit that has continually pushed the 

aerospace community to accomplish the seemingly impossible. A well-developed "leadership 

bench" is also necessary for a program or mission's success. This ensures the availability of 

appropriate expertise to assess and balance risk and priorities-all in a timely manner. 

Developing the workforce through hands-on real hardware programs will provide the needed 

bench strength. 

5 
86 

The tightly constrained and constantly changing fiscal environment also leaves little 

maneuvering room or forgiveness for the ability to predict outcomes during a development 

process. Since the Challenger accident in 1986, and particularly following the Columbia 

accident, NASA's program and project managers have become increasingly conservative, 

sometimes losing sight of opportunities that present themselves by pushing the envelope of 

design, technology, and testing. 

I must be crystal clear on this point: Safety remains the utmost priority in space exploration. 

This nation must always protect the safety of the astronauts, their families, and the workforce. I 

am suggesting that there is a better balance in terms of accepting risk. NASA must be allowed, 

like in the Apollo era, to recognize the opportunities, be bold in pursuing them, assess the risks, 

and consciously and continuously manage the risk for these challenging endeavors- without 

facing punitive outcomes. By its very nature, exploration requires the ability to understand the 

situation and make intelligent judgments to move forward. 

Conclusion 

The keys to a well-executed program are stable and adequate funding and a sufficiently 

experienced workforce. Plain and simple. I commend NASA for doing such a great job operating 

under the current unpredictable budget environment and funding constraints. The agency is 

working to integrate the latest technologies to reduce costs while maintaining or improving 

performance and safety. The programs in development are advancing steadily, and they will 

continue to encounter technical, management, and operational challenges. Keeping programs 

on schedule is essential to maintain our global leadership in space and minimize the overall 

program costs. A return to a regular appropriations process coupled with a long-term 

perspective will help address these issues and will help accomplish the administration's goat of 

returning to the moon and furthering the human neighborhood to Mars and beyond. 

At the same time, Congress must continue to pass legislation that enhances the pipeline of 

STEAM-competent workers into the U.S. economy; this includes initiatives aimed at 

underrepresented demographics. Congress should also craft legislation that will bolster 

economic competitiveness and job opportunities in the sector and encourage education and 

training programs required for both the existing workforce and new entrants. Federal 

incentives and/or grants need to be readily available to support industry, government, and 

academic partnerships that tailor training for high-level skills and that provide professional 

education opportunities and research-focused collaborations. And Congress should pass visa 

legislation that encourages the retention of foreign professional workers in U.S. industry. 

6 
87 

Again, thank you for the opportunity to address this body and thank you for your continued 

support of our nation's space program. I look forward to answering any questions you may 

have for me in this regard. 

7 
88 

Daniel L. Dumbacher 

Dan Dumbacher is the Executive Director of the American Institute of Aeronautics and Astronautics 

{AIM). 

Before joining the AIM staff in January 2018, Dumbacher was a Professor of Engineering Practice 

in the School of Aeronautics and Astronautics at Purdue University, where he taught courses in 

systems thinking, systems engineering, and space policy. 

Prior to Purdue, Dumbacher served as the Deputy Associate Administrator, Exploration Systems 

Development Division, Human Exploration and Operations Mission Directorate at NASA 

Headquarters. In that capacity, he provided leadership and management as the Program Director 

for Exploration Systems Development, which included: the Space Launch System, Orion, and 

Ground Systems Development and Operations development and integration efforts. He led a 

national team of over 5,000, spanning all NASA centers and industry, and was responsible for a $3 

billion annual budget. 

During his career, he has received numerous awards and honors including the coveted Silver 

Snoopy Award and the NASA Distinguished Service Medal. In 2015, Purdue recognized him with 

the Gustafson Teaching Award. 

Dumbacher earned his bachelor's degree in mechanical engineering from Purdue University and a 

master's degree in business administration from the University of Alabama in Huntsville. He has 

also completed the Senior Managers in Government program at Harvard University. 

Dumbacher is a native of Indianapolis, Indiana. He and his wife Lee have three grown children. 
89 

Chairman BABIN. Thank you, Mr. Dumbacher. We appreciate it. 

Now, I would like to recognize myself for five minutes for questioning. And I have a bunch of questions, and I’m sure everybody 

else does, too, so if you could just get right to the point, answer 

these things, we want to cover as much of this part of ground as 

we possibly can. 

NASA has a storied history with overrunning costs and schedules 

for space systems development. Some of these programs have even 

suffered cancelation as a result, and this has simply got to stop. We 

need performance, not excuses from the agency, as well as providers. And with that in mind, of NASA’s options, what acquisition 

mechanisms such as cost-plus, fixed-price, or Space Act Agreements 

are most useful in promoting performance and holding the provider 

as well as the agency management accountable for meeting the acquisition requirements? And I’d ask you first, Mr. Dumbacher. 

Mr. DUMBACHER. Congressman, I think the appropriate acquisition tool depends on the objectives of the program and the scientific 

engineering issues and risks associated with that. 

Typically, we have a lot of experience with cost-plus contracts in 

this country. NASA uses that a lot for its major programs. There 

is the discussion of public-private partnerships, which can also be 

valuable and have been tried in the past, some successful, some 

not. When we consider all of this, we need to consider the objectives that are for the program, what are the incentives and the motives that are necessary for success both in terms of how it would 

apply in a public-private partnership, as well as a cost-plus arena? 

And we need to sort through those and make valid, conscious, objective decisions. 

Chairman BABIN. Thank you. And now that same question, Ms. 

Chaplain, if you would answer that. I don’t need to repeat it, right? 

Ms. CHAPLAIN. Right. 

Chairman BABIN. Okay. 

Chairman BABIN. So with fixed-price contracts, the contractor 

bears the most risk for meeting cost and schedule goals, so that’s 

your main aim. That’s a contract, but it’s not really appropriate 

when you’re facing a lot of unknowns at the beginning. If you’re 

really stretching technology, don’t know how long it’s going to take, 

how much it’s going to cost, in that case the government does need 

to bear the risk of the contract, and that’s where cost-plus comes 

in. 

Chairman BABIN. Okay. Thank you. And then we’re talking 

about cost-plus, so I’m just going to—the second part of my question to you two, do cost-plus contracts provide any incentive for the 

provider to complete the project on time and on schedule? 

Ms. CHAPLAIN. There are typically incentives built into the contract, and they come through the award fees. So some may be tied 

to performance and quality and things like that, but others could 

definitely be tied to cost and schedule. 

Chairman BABIN. Okay. All right. Thank you. And, Mr. 

Dumbacher? 

Mr. DUMBACHER. Just to add a little bit to that, when we have 

done award fee, cost-plus award fee, and incentive fee in the past, 

we do and can make schedule performance and cost performance 

part of the evaluation criteria, and that is typically included. 
90 

Chairman BABIN. Okay. Thank you. And then to Mr. Martin and 

Ms. Chaplain as well, acquisition encompasses a great deal, including strategic planning, procurement processes, and the development of clear requirements. For many years, the DOD has employed a robust training and certification program for defense acquisition professionals. What institutional improvements such as 

training, certification, and career progression are necessary or perhaps missing from NASA’s acquisition processes? 

Ms. CHAPLAIN. I know NASA has invested pretty heavily in 

training cost estimators and project management. They have conferences every year, for example. But I still think maybe more 

could be done in that area in certain techniques and especially 

more program management issues related to managing contracts. 

Chairman BABIN. Okay. And then Mr. Martin? 

Mr. MARTIN. Attracting and retaining the project managers is a 

real challenge for the agency. As Mr. Dumbacher suggested, within 

NASA, 50 percent of the workforce is over 50 years old, and with 

a diminishing number of small projects for these project managers 

to really get the experience and cut their teeth on, it’s a real concern. 

Chairman BABIN. Okay. And then do you think NASA can gain 

from DOD’s experiences? 

Mr. MARTIN. I’m not as familiar with DOD’s experiences. 

Chairman BABIN. Okay. Ms. Chaplain? 

Ms. CHAPLAIN. I think that Defense Acquisition University is a 

very good model for training programs and all kinds of issues. It’s 

something NASA could look toward. 

Chairman BABIN. Okay. Thank you. 

Mr. Jurczyk, NASA recently took steps to control the costs of the 

Europa Clipper and WFIRST missions while in formulation. Have 

these steps proven helpful, and can similar measures be implemented on other major projects to control the cost? 

Mr. JURCZYK. Yes. On WFIRST we did an independent—had an 

independent review board come in and look at the project early in 

phase A, in formulation, and they confirmed that the project scope 

had grown and they were not going to be able to execute the mission within the $3.2 billion budget that we had for their—for them 

for the management agreement. They made some recommendations. The project took those recommendations and adjusted the 

scope and re-planned the cost and schedule estimates and they 

came in and presented their baseline to the agency program management council, which I chair. And we have confidence, based on 

their estimate given the re-plan, that they have a solid estimate 

going into phase B. I think that—and similarly for Europa Clipper. 

So I think that is a way to try to minimize cost and schedule risk 

early in the program. 

Chairman BABIN. Okay. I’m out of time. I had several more questions, but thank you very much. 

I’d like to recognize the gentleman from California, the Ranking 

Member, Mr. Bera. 

Mr. BERA. Thank you, Mr. Chairman. Each of you in your opening statements obviously touch on the complexity of budgeting and 

scheduling when you’re trying to do something that you may never 

have done before. And I have to imagine when we started on the 
91 

Apollo missions, lots of cost overruns, lots of scheduling delays, but 

as you got further down the road, understood what we had to do, 

that started to reduce and there was more predictability. 

As we think about future missions, let’s put it in the context of 

something we talk a lot about, Mars by 2033. We don’t know how 

we’re going to do that. We don’t know the technology and the 

science and everything else. As we go into deeper space, we are encountering more complicated projects. As we look at the balance of 

the commercial sector, the entrepreneurial sector, more reliance on 

external entities. When we did Apollo, NASA was the launch vehicle, the landing vehicle, the science mission, maybe a little bit more 

control as you think about working with outside contractors and 

new startup companies that may be—a little bit more unpredictability, I think that adds another variable. As the international 

community becomes much more engaged, as you see countries like 

India, Japan, the European Space Agency start to do some of the 

science, another complicated variable. 

So, as opposed to budgeting and scheduling getting easier, my 

sense is budgeting and scheduling is going to get more difficult. Is 

that a reasonable—reasonably accurate thought? I guess, Ms. 

Chaplain. 

Ms. CHAPLAIN. Well, I would like to note in the Apollo era, a lot 

of things had never been done before, so they were very difficult 

to estimate. I think now we have the benefit of time and history 

that there are a lot of things we can estimate even if we haven’t 

done that particular mission. 

And I also know that in the past decade the three space agencies, 

DOD, NRO, and NASA have been working very closely together to 

kind of gain that historical perspective in costs and build databases 

so there is more knowledge there that gives you an advantage. But 

yes, those other complexities do make it hard. 

Mr. BERA. Right. And as we think about that, learning from 

what we’ve done in the past, trying to create more predictable models of budgeting and scheduling, I think to Chairman Babin’s question, you know, I’ll put it in the context of my profession as a doctor. We’ll often—and—as we’re caring for populations of patients, 

we’ll have a shared risk pool that says, okay for a certain fee, we’re 

going to take care of this population of patients. If we do really 

well, we improve health, et cetera, there’s a reward on that end. 

If, on the other hand, we do a bad job taking care of these patients, 

we share some of that risk. 

And I don’t know if in contracting—I think you touched on the 

shared risk award fees, et cetera. Have you noticed in that type of 

contracting that you actually get better predictability when not 

doing something that we know how to do and is pretty predictable 

but something where there is some risk involved? And Ms. Chaplain, if you want to answer that or, Mr. Martin, if you want to take 

that. 

Mr. MARTIN. Let me just toss in that over the last ten years, 

NASA has moved to a new procurement mechanism, the funded 

Space Act Agreements, particularly to spur development of transportation capabilities for cargo and crew services to the International Space Station. Now, NASA contributes significant—billions of dollars—to the funded Space Act Agreements, but the com-
92 

mercial companies also have a significant financial stake in the 

game. So having them have their skin in the game as well to develop these private capabilities of which NASA will be procuring as 

a service, I think is interesting and has been relatively successful. 

Has it increased cost schedule and timing? Not particularly. 

Mr. BERA. Mr. Jurczyk? 

Mr. JURCZYK. Yes, as I said before, we choose kind of—either a 

FAR-based, you know, contract, either cost reimbursement or fixed 

price or a public-private partnership where it makes sense. Particularly public-private partnerships where there’s shared strategic 

common interests between ourselves and an industry partner or 

partners, that makes a lot of sense, and therefore, there—we also 

share the risk there in that partnership. 

We did do a reimbursable Space Act Agreement, a funded Space 

Act Agreement for cargo. We’ve kind of moved away from that approach because of our ability to have insight and manage. And our 

latest public-private partnerships have actually been through fixedprice contracts with cost-sharing where we use the FAR rules to 

manage the relationship and allow the contractor to contribute resources and share the risk. 

Mr. BERA. All right I’m out of time, so—— 

Chairman BABIN. Thank you very much. 

And now, I’d like to recognize the Chairman of the full committee, Mr. Smith from Texas. 

Chairman SMITH. Thank you, Mr. Chairman. 

Ms. Chaplain and Mr. Martin, a lot of NASA contractors seem 

to not be able to stay on schedule, they fall behind, and they end 

up with cost overruns and fail to perform as we expect them to do. 

In the 2018 NASA Authorization Act, we have a watchlist for contractors who don’t perform well. 

And let me—before I get to my specific question, let me just say 

that I think the American people are rightfully sometimes frustrated by the Federal Government when things go wrong, when 

projects end up not being performed as they should, when there are 

cost overruns, when the deadlines are missed. And somehow no one 

is held accountable; no one is responsible. It just happened. And I 

think that is frustrating to the American people when they see 

projects that cost millions if not billions of dollars more than expected. 

So I’d like to ask you all who you think would be good candidates 

for that watchlist. The watchlist is just that, these are contractors 

who need to be watched more closely, who need to be reminded of 

their contractual obligations and perhaps sanctioned if they don’t 

improve their performance. But, given your investigations, who are 

some of the contractors that we might consider putting on such a 

watchlist? And, Ms. Chaplain, start with you if we could. 

Ms. CHAPLAIN. It’s a difficult question because in some cases 

there’s a shared responsibility between NASA and the contractor, 

so it’s hard to parse out who’s really responsible for that overrun. 

Even when it comes to like a workmanship issue, there could be 

some shared responsibility there. 

If you look at the provision you were talking about, there are a 

couple projects in our list where performance has been bad consist-
93 

ently over time, and NASA has actually canceled or proposed canceling a project or is looking at whether to do that because— 

Chairman SMITH. Okay. 

Ms. CHAPLAIN. —contractor performance. In those cases— 

Chairman SMITH. And who were those contractors? 

Ms. CHAPLAIN. One is—for the SGSS project, that would be General Dynamics, so that project is being looked at. Performance has 

been a long-standing issue on that. 

Chairman SMITH. Okay. 

Ms. CHAPLAIN. The other one was the RBI Instrument, which is 

a weather satellite sensor. That one was proposed for termination. 

That was Harris Corporation and formerly Exelis. That—those are 

the more extreme cases— 

Chairman SMITH. Okay. 

Ms. CHAPLAIN. —that could possibly—but it’s ultimately like 

NASA’s decision, and they have to— 

Chairman SMITH. I understand. 

Ms. CHAPLAIN. —really investigate the situation. 

Chairman SMITH. Okay. Thank you. Mr. Martin, in your testimony, you made a couple of really good suggestions I thought to 

try to avoid the to-big-to-fail syndrome. What are some other ways 

we can hold contractors accountable? We have the watchlist. What 

are some other things that we can do to keep projects on time and 

on budget? 

Mr. MARTIN. I think one of them is what you are doing here 

today is an oversight hearing and the proposed hearing several 

weeks from now to focus on the issues specific to JWST. 

Chairman SMITH. Right. 

Mr. MARTIN. I think aggressive oversight by GAO and the IG’s 

Office is important, and I think just a general sense that folks need 

to be held accountable for—you know, there’s human failure, we all 

fail, but there are avoidable human mistakes on some of these 

projects. For instance, the improper use of a solvent on the JWST 

by Northrop Grumman, inadequate welding on the SLS core stage 

by Boeing, as the prime contractor. So we have individual avoidable mistakes. 

We have issues with our international partnerships, which are 

key to the future of NASA. But when the European Service Module 

is 14 months behind schedule, that impacts Orion. 

Chairman SMITH. Right. Final question for you and also I think 

for Ms. Chaplain, and it is this, that it is very unlikely that 

NASA’s budget is going to see a significant increase, say 25 percent, anytime soon. It’s just not the nature of our spending, and 

various constraints are going to prohibit I think any agency from 

getting a significant increase. We’re fortunate, I believe, to have— 

NASA had sort of a flatline budget. So many agencies—other agencies have been cut. Yet there are a lot of people and pundits who 

expect us to keep the International Space Station as-is, go back to 

the moon, and then on to Mars, and seem to be able to think we’re 

going to do everything all the time. 

I think that in my opinion is not being willing to make some difficult decisions. Realistically, I don’t think it’s possible. I think it’s 

very naive to think we can do everything all the time. Do you agree 

with that assessment or is—am I missing—is there some magic so-
94 

lution that will enable us to do everything all the time? Or are we 

going to have to take a hard look at some of these big missions 

like—either ones that we already have like the space station or 

others to come like the Moon and Mars? 

Mr. MARTIN. No, you’re not missing anything. I think it’s all 

about choices. There’s a finite amount of resources, and you’re 

right, NASA has been very fortunate in the budgets it’s received 

over the years. But that’s why cost and schedule estimation is so 

important, to come up with realistic cost and schedule so you can 

put it before the decision-makers at NASA and in Congress. 

Had NASA been able to say that the James Webb Space Telescope was going to cost $8 billion ten years ago when it was proposed, then it’s a decision. You do James Webb—and I’m not suggesting it should or shouldn’t have been done. It’s going to do 

amazing things when it’s up there—but you make a decision based 

on that. But if you say yes to James Webb, you’re saying no to a 

lot of other things. 

Chairman SMITH. Right. And that’s what we have to appreciate 

and recognize and understand. 

My time is up but, Ms. Chaplain, can you give us a really brief 

response to that as well? 

Ms. CHAPLAIN. I think NASA is at risk of having too many programs to pay for at one time. Even if you look at what we’ve been 

looking at over the years, we started out with 15 to 16 projects. 

That helped them reduce cost overall. 

Chairman SMITH. Okay. 

Ms. CHAPLAIN. Now, we’re looking at 26. 

Chairman SMITH. Okay. Thank you. Thank you, Mr. Chairman. 

Chairman BABIN. Great questions. Thank you. 

I now recognize the gentlelady from Texas, Ms. Johnson. 

Ms. JOHNSON. Thank you very much. 

Ms. Chaplain, in your 2017 assessment of NASA’s major projects, 

you indicated that in October 2015, NASA decided to decentralize 

its independent assessment function and deploy the staff to the 

agency centers in part to better use its workforce to meet program 

needs in areas such as program management and cost estimating. 

GAO had previously reported on the potential risk that this 

change could pose for project oversight but stated that it was too 

early in the transition to assess its effect on areas such as independence, the robustness of the reviews, and information-sharing. 

So now one year later, are you able to tell us whether that decentralization was successful? 

Ms. CHAPLAIN. We haven’t seen a real visible impact either way 

yet. We’re still very concerned about that move. I think it’s beneficial to the agency to have centralized expertise in those areas. 

They really can leverage each other a lot. 

Ms. JOHNSON. Mr. Jurczyk, do you have any comment? 

Mr. JURCZYK. Yes, I think we’ve moved to a model where we’re 

putting the responsibility and accountability of the mission directorate to manage the programs to do that independent assessment, 

and so far, they’ve stepped up to the job, and I think they’re doing 

an effective job in implementing our spaceflight project management processes, including reviews. 
95 

We do still have a cadre of experts in the Office of the Chief Financial Officer that have schedule and cost assessment expertise 

that the review boards can draw on. And we’ve also given stewardship of project planning and control to the Office of the Chief Financial Officer, and that’s been very beneficial, and not only this 

cadre of people for schedule and cost estimating but improving our 

skills and processes and capabilities in cost and schedule estimating and management. 

Ms. JOHNSON. Okay. Let me ask you this. What are the most important things that NASA can do to minimize cost and schedule 

growth? And when NASA is faced with an unexpected cost growth 

and schedule delay, what are the tradeoffs that NASA can make? 

And give me some examples of successful tradeoffs. 

Mr. JURCZYK. Yes, so, you know, I think we continue to mature 

and effectively apply the joint confidence level process is going to 

be really important. And I’ve seen—since 2009, I’ve seen the value 

of that in budgeting projects at the agency based on coming in at 

the 70 percent confidence level, and I think we can do even better 

there in maturing that process. And I’ve seen success, and I think 

we need to continue to have success there. 

I think we can—we need to continue to focus on development of 

the project management workforce and the program planning and 

control workforce has been noted, including, you know, hiring and 

developing the talent through hands-on project management and 

project experience and training. 

About 15 years ago, we identified a shortage of skills in project 

planning and control, and we’ve really taken on an effort to hire 

and train people in that area, cost estimating and schedule estimating and management, and I think that’s paid off. We need to 

continue to do that. 

We talked about independent assessments, and we can continue 

to strengthen independent assessments. 

And then we have capturing and communicating lessons learned 

and looking for systemic issues and challenges across programs and 

putting corrective action plans in place to deal with those like the 

shortage of program planning and control staff. We need to continue to do that. And I think all those things can lead to improved 

program project—continued improved program project performance. 

Ms. JOHNSON. Thank you very much. My time is about out, but 

would any other witness like to comment on any of the questions? 

Ms. CHAPLAIN. I would just add a couple more things to his list. 

One would be to update cost estimates and schedule estimates as 

risks change over time. We see programs reluctant to do that. And 

then focusing more on quality management because these workmanship issues come up all the time. There has been efforts to 

focus on that, but I think more can be done. 

Mr. DUMBACHER. Congressman, I would like to add also there’s 

also—there is a need to recognize that you need appropriate skills 

for the portion of the program lifecycle you are in. So development 

skills are needed upfront in a development program, operational 

skills at the end, and we need to make sure that we’re working for 

the right skills at the right time. 

Ms. JOHNSON. Thank you very much. Thank you, Mr. Chairman. 

Chairman BABIN. Yes, ma’am. Thank you. 
96 

I’d like to recognize the gentleman from Oklahoma now, Mr. 

Lucas. 

Mr. LUCAS. Thank you, Mr. Chairman. 

And thinking about the questions that my colleagues have had, 

Mr. Jurczyk, let’s discuss for a moment in January of 2018 GAO 

found that the commercial crew program contractors Boeing and 

SpaceX experienced additional schedule delays for their demonstration missions and their certification of the vehicles for human 

spaceflight, and these delays could jeopardize the ability of NASA 

to maintain access to the International Space Station. Will there be 

a gap in U.S. access to the International Space Station? 

Mr. JURCZYK. No, there will not be a gap in access. We’ve taken 

actions and we have other actions we can take to minimize the risk 

of a gap, so the first action we have taken is to buy three more 

seats on Soyuz, and that extends the ability to access station by 

that capability and minimizes the risk of any gap between our 

Soyuz contracted seats ending and commercial crew coming online. 

There’s a couple other things that we’re looking at. One is adding 

a third crewmember to the first Boeing crewed flight. That will be 

important. The other is extending missions from approximately 140 

days to 190 days and being able to space the launches—the Soyuz 

launches out, and these are other actions we can take to further 

mitigate any risk of a gap. 

Mr. LUCAS. But you’re confident that the direction the contractors are going, that we won’t have to use those measures? 

Mr. JURCZYK. We—this summer, we’re engaging in an assessment of the schedules for both SpaceX and Boeing, and we’ll have 

a better handle on whether we need to take those initial measures 

at the end of the summer. We’d be glad to report back to you on 

that. 

Mr. LUCAS. Fair enough. Mr. Chairman, that answers my question. I yield back. 

Chairman BABIN. Yes, sir. Thank you. 

And now, I’d like to recognize the gentleman from Virginia, Mr. 

Beyer. 

Mr. BEYER. Mr. Chairman, thank you very much, and thank you 

all for being here. 

Ms. Chaplain, you mentioned that it would be helpful to have 

much more frequent updates of cost and timelines, that these come 

very sporadically. I know in the family business we update the projections at least once a month. Here in the Federal Government 

we’re getting all kinds of monthly reports on new-home sales and 

unemployment claims and new jobs created. Why are NASA and 

the contractors reluctant to update on a regular basis when it 

would be probably a lot easier to tolerate? 

Ms. CHAPLAIN. Yes, it would be easier if they continually did it 

because then it wouldn’t be such a chore to do it after a couple 

years. But right now, they set the baselines when they really start 

their program, and they don’t revisit. And in some cases I think 

they don’t want to revisit. They don’t want to really show to the 

world like what the cost truly is at that point. But you’d really 

have to ask the programs. I think it’s a healthy thing to do when 

you see conditions change. 
97 

In the James Webb program there were a lot of things that had 

changed in a few years. The cryocooler, for example, took way 

longer to manufacture than anticipated. That would have been a 

good time to reassess where the project stood, but they didn’t do 

it. 

Mr. BEYER. This may be one of the things as we move forward 

is looking at requiring much more frequent updates on both cost 

and timeline. 

Mr. Dumbacher, this may be more of a rhetorical editorial comment, but you write, ‘‘The current budgeting process, including the 

regular use of continuing resolutions, late-year appropriations, 

threats of government shutdowns, result in endless, multiple planning scenarios.’’ Resolving complex technical issues, hold schedules, 

and predicting accurate flight dates is difficult when the budget is 

constantly in flux. Is it then credible to say that Congress plays a 

role in the problems that NASA has with budget and timeline? 

Mr. DUMBACHER. Yes, sir, I would say that. 

Mr. BEYER. You don’t need to say anymore. But thank you for 

making that so clear. 

Mr. Jurczyk, why not under-promise and overperform? I know 

that’s what my children do with me. 

Mr. JURCZYK. Yes. So, you know, our job on—in any given program area is to optimize the portfolio and deliver the most science 

or exploration missions that we can for the budget given. So we 

have, you know, taken an approach of having a portfolio of small, 

medium, and large missions and an approach where we budget 

these missions at the 70 percent confidence level. We think that 

balances the risk of projects in formulation and implementation 

against the opportunity cost of budgeting more than at the 70 percent confidence level and delaying starting new missions. So it’s a 

matter of optimizing the portfolios and delivering the most science 

and exploration content we can for the budget that we have been 

given. 

Mr. BEYER. I would suggest to you that part of optimizing that 

is managing the expectations of the people whose expectations you 

have to—— 

Mr. JURCZYK. Yes, we can definitely do a better job at managing 

expectations. 

Mr. BEYER. Mr. Martin? 

Mr. MARTIN. I think one of the other realistic things is if you 

under-promise, you’re in greater danger of not getting your project 

started in the first place, of attracting enough excitement and attention to get the project funded. So I think what NASA’s problem 

is often is they overpromise, obviously overpromise the maturity of 

the technology. 

I was struck in the—like a lawyer going over the footnote on 

page 3 of our written statement, there’s a quote from former Administrator Griffin. I think he was current Administrator at that 

time talking about projects, proponents of individual missions, 

downplay the technical difficulty and risk, grossly at times, in 

order to gain new start funds. I think that has been a historic problem for NASA. 

Mr. BEYER. You raised two interesting pieces in your testimony, 

Mr. Martin. One was that there’s this culture of optimism that was 
98 

too optimistic, and, number two, that we needed far more accountability. But at the same time, the dilemma with the accountability 

is we also have a shortage of the talent that we need, you know, 

more than half are over 50 years old, the challenge with getting the 

STEM kids. How do you ratchet up accountability and not depress, 

you know, the enthusiasm, the sense of worth? And also how do 

you dampen out the optimism in an agency that has to be so optimistic? 

Mr. MARTIN. It’s an incredibly difficult—you’re dancing on the 

edge of a knife when you do that because, as you point out, you 

have to have that optimism, that freethinking to really think of 

things that have never been built before, to conceptualize them and 

then actually put—to start bending metal on them. So it’s an incredibly difficult balance. 

If it was easy, NASA would be doing it. I mean, it is rocket 

science after all, and so it is very difficult. And I just think—and, 

like I said, NASA has brought in a lot of its cost-estimating techniques and its JCLs and other processes—they just need to force 

adherence to it, to those requirements. 

Mr. BEYER. Great. Thank you. Mr. Chair, I’ll yield back. 

Chairman BABIN. Yes, sir. Thank you. 

Now, I’d like to recognize the gentleman from Alabama, Mr. 

Brooks. 

Mr. BROOKS. Thank you, Mr. Chairman. 

I am concerned by the perceived transition process away from 

the current operational format of the International Space Station. 

There have not been, in my judgment, enough substantive public 

debate on what this transition involves. 

And with that as a backdrop, I have a question directed at Ms. 

Chaplain, Director, Contracting and National Security Acquisitions, 

GAO; and NASA Associate Administrator Stephen Jurczyk. First, 

has NASA come up with a definition of what commercialization of 

the International Space Station means? 

Ms. CHAPLAIN. We have not been doing work in that area, and 

I don’t believe they have yet, but I’ll let Steve—— 

Mr. JURCZYK. Yes, so let me tell you where we are with I would 

say the more detailed planning of the station transition. So we released a solicitation not too long ago for studies, industry studies 

on transitioning space station to some sort of collaborative or commercial enterprise. We’re getting the proposals back in this week, 

and we’ll evaluate those. 

And what we asked for in those studies is the capabilities that 

commercial thinks they can provide us as compared to what we 

need and what we have and we need in the future. The second is 

their technical approach to achieving those capabilities. And then 

third is their business plan. You know, what is their business plan? 

Because, although we don’t have a rigorous definition, NASA 

should be a maybe 20, 30 percent user of the capability and other 

government entities and commercial entities should also use that 

capability. We should not be the 80 or 90 percent, you know, kind 

of anchor tenant of a capability. To me—personally to me, it’s not— 

I would not define it as commercial. 

So we’re going to get those studies back in December, and that 

will inform a more detailed transition plan. And I think we’d be 
99 

ready to come to you all and present that plan and get your feedback and input on it. 

Mr. BROOKS. When do you anticipate having that more detailed 

plan that you can present to us that we have a better understanding of what this commercialization means? 

Mr. JURCZYK. Yes, we’ll get the results from the studies in December of this year, so we’ll probably need some number of months, 

so probably, you know, first half of next calendar year we’ll definitely be able to come back to you and lay that out informed by 

that—those industry studies and industry input of what looks feasible in the mid-’20s time frame. 

Mr. BROOKS. So you would be in a position to answer the question in the first 6 months of 2019? Is that correct? 

Mr. JURCZYK. Yes. And I can take a question to get back to you 

on a more exact date if you’d like. 

Mr. BROOKS. All right. Thank you. 

Mr. Martin, your audit of commercial resupply services to the 

International Space Station report dated April 26, 2018, notes that, 

quote, ‘‘SpaceX’s average pricing per kilogram will increase approximately 50 percent under CRS–2 while Orbital ATK’s average 

per-kilogram pricing will decrease by roughly 15 percent.’’ The 

major difference between those contracts is SpaceX’s introduction of 

reusability. SpaceX has noted multiple times that customer should 

not expect substantial discounts on reused hardware. 

My question is this: Are you concerned about whether taxpayers 

will save money with reusable rockets? And second follow-up question is, is it possible reuse may end up costing NASA and the 

United States taxpayer more overall? 

Mr. MARTIN. Steve could probably answer this more specifically, 

but I believe there is a slight reduction in the area of 3 to 7 percent 

for use of a reused SpaceX rocket. I think it’s happened once if not 

twice so far for commercial cargo, so there is a slight reduction. 

And am I concerned? I mean, it’s a safety issue, and so the 

launch services people need to assess the specific rocket, and they 

have access to the rocket, before they authorize them for launch. 

Mr. BROOKS. Well, Mr. Jurczyk, since Mr. Martin pointed the finger at you—— 

Mr. JURCZYK. Yes. 

Mr. BROOKS. —with your insight, can you—— 

Mr. JURCZYK. Yes, I think—— 

Mr. BROOKS. —share what insights you may have on that question? 

Mr. JURCZYK. Yes, I think Mr. Martin is right with respect to the 

marginal cost reduction, with the introduction of the reusability of 

the first stage of the Falcon 9, and they’re also working towards 

reusing the fairing and they recently are—announced that they’re 

looking at approach to reuse the upper stage also. 

I think as we—as they gain experience and as anybody gains experience operationally with the system and they gain experience 

with reuse, I think there is opportunity to further reduce the risk 

and reduce the cost, my understanding what the condition of the 

hardware is when it comes back and how much effort it takes to 

recondition it, to re-fly it, so there’s opportunity there. I’m not able 
100 

to predict what additional savings they might achieve through 

reuse at this point. 

Mr. BROOKS. Is there any chance you could expound on increased 

risk factor of using a novel approach, i.e., reusable rockets? 

Mr. JURCZYK. Yes, we’re—like Mr. Martin said, we’re—the 

Launch Services Program is in the process of assessing that risk 

for all missions, and I can take a question for the record on that 

to get back with you when that assessment will be done. 

Mr. BROOKS. Please. Thank you, Mr. Chairman. 

Chairman BABIN. Thank you. I now recognize the gentleman 

from Pennsylvania, Mr. Lamb. 

Mr. LAMB. Thank you, Mr. Chairman. 

Everyone, I appreciate you highlighting the difficult position that 

you’re in when it comes to unpredictable funding streams, threats 

to shut down the government, funding by CRs, that kind of thing. 

I’m trying to learn a little bit more about how that actually affects 

you on the ground day-to-day. This is a question for anyone. Can 

you share some more specific examples of how that might have affected a particular project? 

Mr. DUMBACHER. Well, I’ll be happy to take that because I lived 

it for a while. And what happens, Congressman, is when you’re 

working on a program and you’re trying to put the plan together 

for the future and what’s my workplan for this year, what’s my 

workplan over a five-year budget horizon? And as I’m working 

through the appropriations budgeting process, every time I’m—I 

have to plan to a different number, that means I’ve got to go back 

through that planning iteration process. 

So at a time when the President’s budget request was significantly different from what was typically coming from the appropriations process, it was necessary to—A, to do the plan that was 

supportive and was inclusive in the President’s budget request, and 

I had to be ready as a program manager that if additional appropriations did come in, I at least had an ability to plan and be able 

to react to that. 

Mr. LAMB. And what type of program were you managing that 

you’re talking about right now? 

Mr. DUMBACHER. At the time I was doing this, this was the beginning of the SLS and Orion programs. 

Mr. LAMB. Okay. And so that was a program that was supposed 

to take how long kind of from start to finish? 

Mr. DUMBACHER. At the time I was there, we were looking at 

first launch in the 2017, 2018 time frame, and in the—while I— 

during my tenure as the Program Director for SLS and Orion, we 

had to deal with a government shutdown, continual negotiations on 

both ends of Pennsylvania Avenue, and then in addition to that, 

while I’m doing all that planning, my—the team’s focus is pulled 

away from the day-to-day management of these technically complex 

jobs. So we were working through all of that and actually had to 

deal with a government shutdown and work through that and then 

all the multiple planning cycles. 

Mr. LAMB. Thank you. And, Ms. Chaplain, it seemed like you had 

something to add. 

Ms. CHAPLAIN. I think I’ve heard very similar things from other 

agencies that I oversee like Missile Defense, that kind of constant 
101 

re-planning and the chaos and time that it consumes. But another 

real example of like the impact of a shutdown can have is a 

cryocooler—or cryo test at the end of a program like James Webb, 

it might take a couple weeks to get the facility ready for this test 

and then two weeks to cool down, and the shutdown—I think there 

was a shutdown threat while there were doing that test this time, 

and they were really worried, like if we had to shut down, we’re 

going to lose a whole month of time. 

Mr. LAMB. Okay. Thank you very much. 

And, again, a question for really anyone because I think it’s 

pressing, but some of you have highlighted the workforce development issues that you have within NASA, and I think it was Mr. 

Dumbacher that talked about young people especially leaving 

NASA for higher-paying jobs in the private sector, which is a challenge obviously across the government. It happens in the military, 

too. But if there was one reform you could suggest or one thing 

that we can improve or strengthen to retain some of this talent and 

to attract new talent, what would it be? 

Mr. DUMBACHER. Well, as I stated in my testimony, the one thing 

I would recommend is good real hardware programs that—to go address those technical needs that we need for space exploration and 

for the NASA mission but to go give these students, give these 

young professionals real hands-on hardware experience because 

that informs their capability and informs their experience throughout their career. 

Mr. JURCZYK. Yes, I would just like to second that. The first 

project I worked on after I got out of college was a spaceflight instrument development project in-house at NASA Langley Research 

Center, so I was able to design, build, integrate, test all the way 

through environmental test flight hardware, and that experience 

was critical throughout my entire career as I moved to a Subsystem Manager and Systems Engineer and Project Manager and 

then Line Manager. So I would just second that. I—it—without 

that experience, I don’t know how I would have been able to be as 

effective as I was as I moved through my career at NASA. 

Mr. DUMBACHER. And if I may just give you a little bit of a story, 

too, if you stand back and look at—there are a group of people of 

which I was one, Robert Lightfoot was one, where we had the ability and we were asked and required by our mentors to actually test 

shuttle main engines in-house, and we tested the new technology 

that ultimately became the final flight configuration for shuttle. 

And that hands-on experience—they—our mentors, our leaders 

forced us into that because they knew that it fit into the long-term 

career. 

Mr. MARTIN. Just echoing the same thing, we’ve heard from a 

number of Project Managers that we’ve spoke with, their frustrations about their spending—agency engineers are spending most of 

their time overseeing contractors’ effort, and that’s frustrating. 

Mr. LAMB. Thank you. Thank you, Mr. Chairman. 

Chairman BABIN. Yes, sir. Thank you. 

I’d like to recognize the gentleman from Louisiana, Mr. Higgins. 

Mr. HIGGINS. Thank you, Mr. Chairman. Mr. Chairman, it’s uplifting to see these young Americans here today, these NASA interns, and I hope you young men and women are paying attention 
102 

to these budget discussions. We are a nation that’s $20 trillion in 

debt. And should this body ever manage to produce a surplus, say, 

$1 billion, it would require 20,000 years of $1 billion surplus to address a $20 trillion debt. 

So I’m prayerful that NASA has a spirit of doing more with less 

because not only are individual projects at risk, but certainly anyone can recognize that a $20 trillion debt puts the entire stability 

of all programs at risk in every government agency. I’m very hopeful that you young Americans are paying close attention to this 

conversation. 

Mr. Martin, I’m concerned about the culture of optimism that 

you referred to and the too-big-to-fail attitude amongst Project 

Managers. But I understand their perception that their projects are 

too big to fail because in every case a tremendous amount of American treasure has been invested in that project, and therefore, it’s 

quite logical for these Project Managers to have this cavalier attitude of too big to fail. What can this Committee do, what can Congress do to ensure projects are developed and managed within their 

budget constraints, including—I’d like your thoughts, sir, regarding 

accountability for our contractors within these projects. 

Mr. MARTIN. Again, I think more frequent conversations with 

Members of Congress about the status of individual projects is important, more fidelity to the cost estimating that NASA does right 

now, and then the occasional example that projects large or small 

are going to be terminated if they go too far over cost and schedule. 

And in preparation for this hearing, I think the last project that 

I remember being canceled was something called GEMS. It was a 

telescope that was supposed to look for evidence of black holes, and 

it was a smaller program from NASA. It was capped at $105 million. And then partway through formulation, they realized in an 

independent cost assessment that it was going to be 20 or 30 percent over that $105 million cap, and NASA canceled it. And it got 

people’s attention. 

Mr. HIGGINS. Generally speaking, the contractors that are involved in cost overruns for NASA projects, large projects, these are 

for-profit companies, are they not? 

Mr. MARTIN. They are, sir. 

Mr. HIGGINS. And has that ever been addressed within the leadership at NASA, that, you know, most Americans, if we receive a 

bid from a professional contractor to perform a particular service, 

then we expect that service performed for the price that was bid. 

And they’re held accountable legally by civil law, and there’s a certain expectation of performance when you’re giving a bid. And yet 

within the Federal Government and certainly within NASA’s large 

projects there seems to be an attitude of well, we’re not really accountable for the actual bid that we presented, and we won’t be 

forced to perform. 

Mr. MARTIN. He’s NASA leadership. 

Mr. JURCZYK. Okay. So, yes, the—most—a lot of the time we’re 

doing things—building—designing and building systems for the 

first time that no one else has ever built before, and so in those 

cases we use a cost reimbursement contractor. And the incentives— 

and we use incentives to hold the contract accountable through a 

performance evaluation plan. And those incentives are tied to fee, 
103 

usually award fee, and that is their profit. So if they do not perform and—they should get a low score against their performance 

evaluation plan and either receive much less profit or no profit depending on how we weight the incentives in the plan and how 

they’re scored. 

So given the high-risk nature and—the nature of what we do, 

very complex systems, very high-risk with new technology, we take 

that approach, and then we hold them accountable. And the ultimate price to pay for them if they don’t perform is loss of—complete loss of profit. 

Mr. HIGGINS. Gentlemen, thank you for your response. 

Mr. Chairman, my time has expired. If there’s a second round, 

I have a question for Ms. Chaplain. 

Chairman BABIN. Yes, sir. Thank you very much. 

Now, the—Mr. Foster. 

Mr. FOSTER. Yes. Thank you. And I guess I’d like to start just 

by making an observation about the—you know, the amount of 

funding that you can think about having in the next decades. Last 

week, the Federal Reserve made the historic announcement that 

household net worth in the United States, the wealth of Americans, 

just went over $100 trillion. This is up $45 trillion since President 

Obama signed the stimulus, reversed the economic collapse, and 

triggers the economic growth that’s going on today. So when people 

tell you there is not enough money to do this or that, the scale for 

that is what fraction of $100 trillion might we think about, you 

know, using to travel to Mars or wherever—whatever your dream 

is. 

I also want to say that I resonated—as a former Project Manager 

and someone doing technical components for large federal projects, 

I very much resonated with your desire to retain in-house expertise. It is very, very difficult to manage a project if you’ve never 

done it yourself. And so when I decided that I had to manage a 

group doing a large number of integrated circuits, I learned all the 

integrated circuit design control tools and made integrated circuits 

myself before I decided that now I could sit at the top and emit 

specifications for other engineers. 

And this is crucial, and we have to look very carefully when we— 

this rush to privatization runs the risk of losing the in-house expertise that will ultimately cost more money because you’ll have 

projects that are not managed as well as they could be. So I just— 

we ought to be very cognizant of that as we contemplate this transition. 

Now, you know, when I think about cost overruns, you know 

they’re sort of two big general classes. The first ones are in enthusiast cost estimates, you know, in the initial scoping of a project, 

the initial scoping is always done by people who are advocates for 

the project, and then you have to get adults in the room with experience to actually pull back and say, okay, how does this compare 

to actual cost? 

The other one is legitimate technical risk. And I would just like 

to say that I would hope that my colleagues in Congress would be 

much more tolerant of technical risk. You know, it is okay to take 

significant technical risk. And if you assemble a group of experts 

that say success is not assured but this looks like a good bet and 
104 

then it turns out you lose the bet, then Congress should be, you 

know, very understanding and tolerant but much less tolerant 

when projects are approved when everyone in the room knows 

the—you know, I don’t want to point fingers, but I’m sure in your 

minds you know several projects that have been approved where a 

large number of the people knew that you weren’t really going to 

get the project done for that cost. And it’s not just NASA. This happens everywhere in the government. 

And so I just was wondering, are there ways that you can identify retrospectively the times when you’ve had enthusiast cost estimates? Are there any sociological red flags that would allow you to 

say, okay, I’m suspicious that this is not a real cost estimate? Yes. 

Ms. CHAPLAIN. I always—I can tell like when I’m suspicious. It’s 

usually when there are very grand statements made about the program and the achievements that it’s going to get seem overly exaggerated. And that’s when you start wondering, are these estimates 

real? 

What I would say in the case of NASA, I kind of trust the process 

that they have because they do review those estimates pretty carefully. They have standing review boards that look at them before 

they make their decisions. They could have more independent estimating to kind of compare. That’s one thing. But I do believe that 

their processes now, as opposed to a few years ago, are pretty rigorous in ensuring those estimates are complete. 

I would just add, one thing you said about taking risks, you 

know, that’s—you need to still do that. I think there is a concern 

within NASA and other places in the government that we’re not 

taking enough technical risk, that we’re too afraid to do that. 

Mr. FOSTER. Yes, I concur. 

Mr. MARTIN. With respect to science missions, NASA relies extensively on the findings of the National Research Council and 

their decadal surveys that identify specific projects, so I think 

that’s another check as opposed to—— 

Mr. FOSTER. No, they don’t do cost estimates. They’re sort of 

given external estimates is my understanding. 

Mr. MARTIN. I think they do cost—they don’t do very good cost 

estimates, but they do cost estimates. 

Mr. FOSTER. Yes. That’s where you need the expertise and judgment, at that stage. Yes. 

Mr. DUMBACHER. And if I may, Congressman, is when I think 

back on my career and some of the places where I’ve seen this 

problem occur the most, one key thing stands out, and that is have 

the people doing the cost estimate be the ones that will be held accountable for the program execution. I have seen a couple of instances where the people making the initial estimate putting the 

plan together knew that they were going to be moving on to something else and then they brought the new person and the new person was what’s this? 

I think if you—if there is an air of accountability and they know 

that they’re ultimately accountable for that cost—for executing to 

their cost estimate, that starts to get the behavior where I think 

you want it sociologically. 
105 

Mr. FOSTER. Thank you. And it’s—well, there’s a whole set of 

questions when you go to an external contractor model, who does 

the cost estimate and who takes the responsibility in that model? 

I guess I’m out of time here. 

Mr. BROOKS. [Presiding] Thank you. The Chair recognizes Congressman Dunn from Florida. 

Mr. DUNN. Thank you very much, Mr. Chairman. Jump right in 

here. 

Mr. Jurczyk, the Canadian Space Agency last month canceled its 

participation in WFIRST project for budgetary reasons. In your assessment what will the impact be to the technology development 

and the cost which results from CSA’s decision to pull out of the 

WFIRST? 

Mr. JURCZYK. Yes, so that decision was factored into the projects 

re-planning after the independent review of WFIRST and was 

factored into the plan they brought forward to move from phase A 

to phase B. So they’ve been able to adjust scope and adjust their 

cost and schedule estimates to stay within the $3.2 billion and still 

without the Canadian contribution, so that—— 

Mr. DUNN. How does that affect the technology development? 

Mr. JURCZYK. I don’t think it significantly affects the technology 

development. I think that the project has a really good plan to 

early on develop prototype hardware—— 

Mr. DUNN. All right. 

Mr. JURCZYK. —to reduce the risk of that element, as well as 

other elements of high risk—— 

Mr. DUNN. How about the mission itself? Does the capability— 

the mission goals, do they change because—— 

Mr. JURCZYK. No. No, the level-one science goals do not change, 

and they will meet the requirements of the mission as defined in 

the NRC decadal survey for astrophysics. 

Mr. DUNN. That’s great news. So the ’18 omnibus bill required 

a lifecycle cost estimate by May 22. That’s behind us. When will 

that be submitted to Congress? 

Mr. JURCZYK. We will get you that within the next couple of 

weeks. It’s been done, and they’re just wrapping up the documentation, and it will be here hopefully within the next 2 or so weeks. 

That’s our plan. 

Mr. DUNN. Great. So many people here on the panel have called 

the assessment—many assessments, that you need stable, predictable funding to plan. So let’s close our eyes just for a minute and 

imagine that Congress might provide multiyear funding authority. 

It’s a pleasant fiction, I know, but let’s imagine that. In that scenario, how would that—how would this authority change your 

planning for your programs? 

Mr. JURCZYK. Well, I think it would allow us to only plan once 

and execute to that plan and deal with the challenges that Mr. 

Dumbacher had articulated before. 

The one example that we have of getting multiyear funding was 

OV–105, which is the replacement orbiter after the Challenger accident where Congress appropriated multiyear funding for that 

project. And they were very successful in executing on schedule and 

on budget with the profile that ramped up, peaked, and ramped 

down like any project—rational project plan should, and having the 
106 

money—the adequate money when they needed it, so that’s just an 

example of what you’re talking about. 

Mr. DUNN. So that might actually be good for a lot of different 

agencies in the government? 

Mr. JURCZYK. For any large complex program that’s going to take 

multiple years to execute, I would think so. 

Mr. DUNN. I’m thinking Ms. Chaplain would love that, right? 

So let me—in our limited time, so again for—well, actually, Mr. 

Jurczyk, you may be under constraints, unable to answer this. I 

think we’re all disappointed that the James Webb Space Telescope 

cost overruns missed—and missed deadlines. What programmatic 

changes would you make to that program to prevent that in light 

of that failure? Can you answer that? 

Mr. JURCZYK. I can tell you what we have done—— 

Mr. DUNN. Okay, good. 

Mr. JURCZYK. —to date, and so the first is a series of actions that 

we worked on with Northrup Grumman. So, first of all, we completely restructured the I&T organization in Northrup to flatten it 

and be able to more clearly hold people accountable for getting 

through the integration and test program. That also has allowed 

them to identify and resolve issues in a more timely manner to 

minimize the impact of those issues. 

We’ve also added staffing to the I&T team out at Northrup, and 

we’ve really strengthened the mission assurance function and personnel out there to deal with some of the workmanship and quality 

issues that were mentioned by Ms. Chaplain and others to try to 

avoid these human errors that have caused schedule delays. Like 

was mentioned, a small error or problem has a very large effect on 

a program like JWST. 

Mr. DUNN. I can well imagine. In the 30 seconds remaining, Mr. 

Martin, do you have anything to add to Mr. Jurczyk’s comments on 

that? 

Mr. MARTIN. Yes, we have not done significant oversight of 

JWST. Congress directed—— 

Mr. DUNN. How about you, Ms. Chaplain? 

Ms. CHAPLAIN. Yes, I believe the actions they’ve taken have been 

reasonable. I would note they were—already had some onsite presence over at NGAS, but we’ll be looking to see how effective those 

actions are as we do our next review. 

Mr. DUNN. Well, here’s wishing you multiyear funding authority. 

And with that, Mr. Chairman, I yield back. 

Mr. BROOKS. The gentleman yields back. 

The Chair recognizes Representative Lofgren from California. 

Ms. LOFGREN. Thank you, Mr. Chairman. I think this is an important hearing, and most of the questions have been asked, but 

I would like to think about what further Congress could do in addition to avoiding the kind of situations Mr. Lamb addressed, the 

shutdowns issue, the inconsistency between the President’s requested budget and what’s appropriated that lends uncertainty to 

the planning process. What could Congress do to limit the uncertainty in funding other than those two issues? The idea of a 

multiyear funding program for large projects is valuable, but can 

you give us further guidance to stem losses through our own actions? 
107 

Ms. CHAPLAIN. I’d—I’ll start. I would say avoid over-specifying 

what your expectations are, avoid setting dates for a program, 

avoid choosing, you know, how they’re going to do it because that 

limits their choices even more in what they can do. 

Mr. JURCZYK. Yes, I would just echo that. We seem to be getting 

more and more direction through the appropriations process, particularly through the report, and we’re—the expectation is we will 

follow that direction. And that constrains the solution space and 

our ability to manage effectively sometimes, so I’d say just to echo 

what Ms. Chaplain said. I think that’s one additional thing I could 

think of. 

Mr. MARTIN. With respect to the funding issues, not only the actual dollar amount, it’s when that dollar amount comes, the proper 

phasing—— 

Ms. LOFGREN. Right. 

Mr. MARTIN. —of the appropriation has impacted NASA programs. 

Mr. DUMBACHER. I would add work to make sure that the environment in which we have these discussions is less punitive and 

more objective and more willing to hear the risks and understand 

the issues. I think we have to be careful that a lot of the—that we 

can be—you’ve inadvertently set up a vicious cycle of oversight 

leads to conservativism leads to more oversight, and it just keeps 

going around in a circle. And I think what Congress can do and 

this Subcommittee can do because of its oversight activities is to 

help establish an environment that allows more open communication on these kinds of issues. 

Ms. LOFGREN. Well, I think the point that Mr. Foster made all 

scientists know, which is failure is a learning experience. I mean, 

science is testing and not knowing the answer before you start. 

And we need to foster that sense of discovery and willingness to 

take risks if we’re going to be successful. 

Let me just close with sort of a parochial question. I represent 

part of Santa Clara County. NASA Ames is located in Santa Clara 

County. And thinking about the demographic issues we face in 

NASA with so much of the workforce being over 50 years of age, 

the NASA Ames facility is located in a key part of the country. It’s 

in Silicon Valley, and there’s a lot of synergy between what’s going 

on in the tech community and NASA Ames. And although it’s very 

expensive to live in Santa Clara County, actually, they just built 

some housing for NASA employees so that it’s possible to maintain 

their—that synergy. 

I’m just wondering in terms of that facility as well as others that 

are co-located with technology centers, what further we can do to 

move top scientists away from really better-paying jobs into the 

agency to make young people who are smart and who are good scientists want to work in NASA? If anybody has an answer to that. 

Mr. DUMBACHER. I’ll take a try at it. I think what the young people want now is similar to what the young people wanted when I 

got out of school. They want exciting work, they want to know that 

they have an opportunity to make a difference, and they want to 

help solve today and future problems. And I think providing those 

and then in addition to the infrastructure kind of options that you 

have described would be extremely beneficial. 
108 

I think they want to—from my experience teaching at Purdue for 

a few years is if you hit those first three bullet, then the students 

will come. That’s why they go to SpaceX and Blue Origin. They see 

exciting work. That’s why they still want to come to NASA because 

NASA still has that cachet that it’s always had. So exciting work, 

help make a difference, and do something quick, and I think you’ll 

be a long way down the road. 

Ms. LOFGREN. Thank you very much. I see my time is expired, 

Mr. Chairman, so I yield back. 

Mr. BROOKS. Thank you for your questions and participation. 

The Chair next recognizes Representative Rohrabacher of California. 

Mr. ROHRABACHER. Thank you very much, Mr. Chairman. I 

apologize for being late to the hearing. Obviously, two important 

hearings have to happen at exactly the same time, which perhaps 

leads me to the first point, which is we need to make sure we hold 

NASA accountable, but I have to assume that the Congress isn’t 

doing its job all that well either. And when we’re talking about continuing resolutions and omnibus bills, I mean, that’s a reflection on 

the fact that we aren’t doing our job here as well. So please don’t 

think if there’s any criticism here coming from this end that we 

don’t realize—or at least some of us don’t realize that there is justified criticism of the way Congress is doing its job. 

Let me ask a couple of questions here about these cost overruns 

and—that seem to be around. They’ve been around as long as I’ve 

been around. And let me ask you this. Is a lot of this intentional 

low bidding on the part of companies in order to achieve a contract? Is this part of that? And to whoever can answer that question. 

Mr. JURCZYK. You know, we have a pretty rigorous request for 

proposal and proposal evaluation process, including independent 

cost and schedule estimates by the government to ensure that 

what’s being proposed is actually executable. What’s being proposed in that contract is executable. 

Mr. ROHRABACHER. So it’s not to say you don’t see this as a 

scheme by some big corporation to intentionally bid low, get the 

contract, and then realize we’re going to have to pay for it later on? 

Mr. JURCZYK. I do not. 

Mr. ROHRABACHER. Okay. Anybody believe that at all? Good. 

Thank you. That helps our understanding of this. 

And a lot of these companies that do have the cost overruns are 

companies that are worth billions and billions of dollars themselves. If—what penalty does a company have that goes through a 

major cost overrun and doesn’t meet its commitments through a 

contract? What’s the punishment? 

Ms. CHAPLAIN. So, as we discussed earlier, you can take actions 

to punish companies just through award and incentive fees, but 

often, they’re tied to multiple objectives so you’re limited in terms 

of what you can do. So the ultimate thing is just to cancel a program if you really feel like—— 

Mr. ROHRABACHER. Well, what about the next program? Can a 

company that did not meet its contract be denied the next contract 

or a contract down the road because they have not met their obligation? 
109 

Ms. CHAPLAIN. Yes, I think that’s possible. And the proposal 

that’s in your bill about a contractor watchlist, they could go on 

that list if they’re not performing well and that NASA will not deal 

with them in the future for a period of time. That is one option. 

I didn’t know if you want to comment. 

Mr. ROHRABACHER. Yes, maybe you could expand on that for me. 

Mr. JURCZYK. Yes, so what we do now—first of all, we have a 

very robust acquisition integrity program within the agency that’s 

run by our Office of Procurement and our Office of the General 

Counsel and so, you know, they, along with the programs, look at 

contract performance and we’ll use the FAR process for suspension 

and debarment for lack of performance or for waste and abuse, you 

know, so we use the existing process. 

The other thing we do is we have the contractor performance assessment reporting system, so when we evaluate a contractor on a 

regular basis, that assessment goes into that system, as well as the 

assessments of all of the departments and agencies within the Federal Government, and then not only NASA but other departments 

and agencies can draw on that to use in assessing past performance of the contract to determine whether to award them anything 

in the future. 

Mr. ROHRABACHER. Well, it seems to me that we have to be much 

more diligent on—in that area and—if—unless we have accountability and responsibility for these things, we can expect to have 

more problems. And I have to assume that we did not have the 

amount of discipline in our system and the accountability that will 

deter companies—perhaps maybe companies that make bids should 

be held responsibility for that bid, meaning that the money that’s 

lost perhaps should be absorbed by the company. As I say, these 

are multibillion-dollar companies, and if they’re going to be taking 

the taxpayer money and failing in what they’re claiming to do, why 

should the taxpayer pick it up? We have—we just mentioned a—we have $20 trillion debt, and 

the gentleman mentioned how that is—if there’s anything that’s 

going to keep us from going into space, it’s going to be the total 

disintegration of our economic system so that we can’t afford any 

of this stuff. 

I would—also, let me just note that we’re also going to have to— 

we have a $20 billion budget for NASA, $20 billion. We should be 

able to do a lot with $20 billion. And let me just note that when 

I first got involved that I realized that the budget wasn’t enough 

to accomplish the missions, and that’s why I dramatically—I tried 

to focus totally on international cooperation and private sector investment. So let’s hope that we—that’s one avenue of making more 

revenue come in, but we also have to make sure we pay attention 

to what this hearing is all about is making sure that we’re managing the actual projects themselves in a way to minimize the loss 

of very scarce dollars. 

So thank you very much, Mr. Chairman. 

Mr. BROOKS. Certainly. The Chair thanks the gentleman for his 

participation. 

We’re nearing the noon hour and we’re going to finish by noon, 

but from what I understand, there may be a member who wishes 

to ask a second set of questions, and as long as we are able to do 
110 

so within that time frame, the Chair is most comfortable in doing 

so. 

Mr. Higgins, did you want to do follow-up? 

Mr. HIGGINS. Thank you, Mr. Chairman. I have one question. 

Mr. BROOKS. Well, one second. The Chair recognizes Representative Higgins of Louisiana for that follow-up. 

Mr. HIGGINS. Thank you, Mr. Chairman, for recognizing me and 

allowing me to ask one question to Ms. Chaplain. 

Ms. Chaplain, NASA has received multiple recommendations on 

ways to better develop cost and schedule estimates, as well as perform joint cost and schedule confidence level analysis during the 

beginning stages of the implementation phase of large projects. In 

December 2012, it was recommended that the JWST project update 

its JCL. According to the report, NASA concurred with this recommendation, and yet no steps were taken to implement it. Further analysis indicates that, if implemented, an updated JCL may 

have prevented schedule delays. 

Among the many known and unknown challenges that NASA encounters regarding cost and schedule continuity, can you elaborate 

on why this recommendation was purposefully overlooked? 

Ms. CHAPLAIN. At the time they did concur, as you said, so I 

didn’t ever have an official reason why it was overlooked. I think 

they just were reluctant to relook at their costs. A couple years 

later, we recommended that they at least do something similar to 

do a cost schedule risk analysis and really take a deep look at their 

risks, and we even were going to do that ourselves, working with 

the contractor, but that was rejected by the contractor. And then 

it wasn’t until they were getting ready to work with the launch 

agency on setting the date that they actually did a schedule risk 

analysis themselves and realized how far behind they really were. 

Mr. HIGGINS. Ms. Chaplain, thank you for your candid answer. 

Mr. Chairman, thank you for allowing me to ask a second question. 

Mr. BROOKS. Certainly. 

Any other member wish to ask any other follow-up questions? 

Seeing none, I thank the witnesses for their valuable testimony 

and the Members for their questions. The record will remain open 

for two weeks for additional comments and written questions from 

Members. 

This hearing is adjourned. 

[Whereupon, at 11:57 a.m., the Subcommittee was adjourned.] 
(111) 

Appendix I 

ANSWERS TO POST-HEARING QUESTIONS
112 

ANSWERS TO POST-HEARING QUESTIONS

Responses by Ms. Cristina Chaplain 
113 

of Defense for the acquisition of major weapons systems, among other things, 1 Most 

NASA projects tend to be considerably smaller than DOD projects and they tend to focus 

on a specific line of scientific research. DOD projects, by contrast, usually need to meet 

requirements of multiple agencies and missions, including those of civil and intelligence 

agencies. DOD currently has a fairly stringent requirements setting process that has 

helped to minimize top-level requirements chum on its major weapon systems. But that 

process is also increasingly viewed as cumbersome and time consuming. 

2. GAO has found that contractor performance is a key contributor to many of the instances 

of cost growth and schedule delay. The identification of contractor performance as a key 

contributor begs the question as to the sufficiency of NASA's oversight of its contractors. 

a. What are your observations on the level of contractor oversight exercised by 

NASA? 

b. In your opinion, is NASA doing enough upfront thinking and communication 

about the project and its requirements in order to clearly lay out to the contractor 

what work needs to be accomplished and the resources available to get there? 

~: NASA has taken steps in the past to improve contractor oversight, but we 

continue to see instances of poor contractor performance in our work that highlight the 

importance of NASA continuing to improve in this area. For example, in May 20182 we 

found that: 

• The Space Network Ground Segment Sustainment project exceeded its original cost 

baseline by at least $461.2 million and had been delayed by at least 48 months, even 

as the scope decreased. The SGSS project attributes most of its cost and schedule 

growth to the contractor underestimating the scope of the development effort. 

Project officials stated the contractor did not fully understand the requirements, 

technical planning was inadequate, and the contractor's planning did not account 

for resolving software detects. In response to the issues the project has faced, the 

SGSS project has taken some actions to try to address contractor performance 

problems, such as working with the contractor to develop new, more reliable cost 

and schedule estimates both for 2017 and beyond. NASA plans to conduct an 

independent review of the project in mid-20 18 to inform a decision on whether to 

continue the project past the operational readiness review. 

1See Weapons Systems Acquisition Reform Act of2009, Pub. L. No. 111-23 (May 22. 2009). The Act has been moditied 

numerous times over the years. See, e.g., Ike Skelton National Defense Authorization Act for Fiscal Year 2011. Pub. L No. 111-

383 §8l3 (Jan. 7. 2011): National Defense Authorization Act for Fiscal Year20 12, Pub. L. No. ll2-81 §819 (Dec. 31. 20ll ). 

2GAO, NA.IA: Assessments ~f Major Projects, GA0-18-280SP (Washington, D.C.: May I. 20 18). 

Page 2 oflO 
114 

• NASA canceled the RBI project because, according to NASA's cancellation 

memorandum, the project experienced continued cost growth, technical issues, and 

poor contractor performance. The project identified the following specific issues 

that contributed to poor project cost and schedule performance: schedule planning 

that did not realistically account for contractor past performance, insufficient 

oversight of the contractor and its subcontractors, and poor integration of 

government and contractor teams with limited transparency concerning risks and 

issues. 

NASA has done a better job of establishing a business case for its projects in recent 

years, but the agency could improve in assessing contractor capabilities prior to awarding 

contracts. With respect to establishing better business cases, since 2015, we have 

observed that NASA has continued its trend of higher numbers of projects maturing 

technologies prior to preliminary design review.3 Demonstrating that technologies will 

work as intended in a relevant environment serves as a fundamental element of a sound 

business case, and projects falling short of this standard often experience subsequent 

technical problems. 

In addition, we found in May 2018 that nine of the 17 projects in development 

experienced cost or schedule growth.4 As a result of this growth, expensive projects are 

going to remain in the portfolio longer than expected. We also found that NASA is likely 

to encounter additional cost growth and schedule delays for projects in the portfolio. 

Because the cost growth experienced on current projects will limit the remaining wedge 

of funding available for new projects, NASA will need to take additional steps to ensure 

that projects are affordable before committing to them. This includes better assessing the 

resources needed to complete a project and then ensuring that the agency has those 

resources available in the years the project would need them. 

3. It is not surprising that teams want to put their best foot forward while being faced with 

the competitive pressure of initiating a mission at the lowest cost. Unfortunately, in some 

cases, content or complexity is often underestimated. How can NASA incentivize its 

teams to be realistic in identifying both their requirements and resource needs? 

Answer: We have found in recent years that NASA's leadership was focused on 

improving acquisition outcomes and had taken some steps to improve its management. 

This includes requiring that NASA major programs and projects develop a joint cost and 

3GA0-18-280SP. 

4GA0-18-280SP. 

Page 3 of lO 
115 

schedule confidence level prior to project confirmation in order to ensure that cost and 

schedule estimates were realistic and projects thoroughly planned for anticipated risks. 

We believe that many of these steps NASA has taken contributed to the largely positive 

trend of cost and schedule performance for NASA • s portfolio of major projects between 

2013 and 2017. 

However, the deterioration of the cost and schedule performance ofNASA's portfolio 

identified in our May 2018 assessment of NASA major projects means that expensive 

projects are going to remain in the portfolio longer than expected and NASA will have to 

find a way to absorb this growth.5 Further, we found that NASA is likely to encounter 

additional cost growth and schedule delays for projects currently in the portfolio. This 

means that NASA may not be able to start as many projects and will need to add 

additional scrutiny to new project proposals to assure that they have a good 

understanding of resources needed to meet mission requirements. 

In our February 2017 high risk update, we found that NASA needed to do more with 

respect to anticipating and mitigating risks--especially with regard to large programs, 

estimating and forecasting costs for its largest projects, and implementing management 

tools.6 We highlighted several actions that would be critical to improving NASA's 

acquisition outcomes, including l) ensuring that NASA conducted adequate and ongoing 

assessments of risks for larger programs because the impacts of any potential 

miscalculations will be felt across NASA's portfolio and 2) ensuring that program offices 

regularly and consistently updated their joint cost and schedule confidence levels across 

the portfolio. An updated project joint cost and schedule confidence level would provide 

both project and agency management with data on relevant risks that can guide project 

decisions. These actions are especially important because projects that encounter cost and 

schedule growth may have an incentive to not disclose problems early or the full extent 

of a problem for fear of being canceled. 

Our broader program management best practice reports have found that organizations can 

create positive incentives for producing realistic estimates and requirements. 7 To ensure 

there is a good foundation for starting new programs, leading organizations will conduct 

high-level strategic planning and investment decisions and concerted efforts to make sure 

that any new initiative the company undertook is achievable within the time and money 

5GAO·l8·280SP. 

6GAO, High-Risk Series: Progress on Many High-Risk Areas, While Substantial ~f}ims Needed on Others, GA0-17-317 

(Washington, D.C.: Feb. 15. 2017). 

7GAO. Best Practices: Better Support of Weapon System Program A-tanagers IV'eeded to Improve Outcomes, GA0-06-110 

(Washington, D.C.: Nov. 30, 2005). 

Page 4 oflO 
116 

and other resources the company had available. Technology development and program 

advocacy are also generally kept out of a program manager's domain. Once new efforts 

get off the ground, program managers are empowered to manage resources, encouraged 

to bring up problems and propose solutions, and consult with senior leaders without fear 

of losing their support. At the same time, however, they are expected to base their 

decisions on hard data and to ensure the right knowledge is in-hand before proceeding 

into the next phases of development. They are also held accountable for their choices, 

though companies generally find that with good pre-program decisions, a good launch, a 

sound, disciplined process for execution, and continued support. there is little need to 

punish or remove their program managers. Ultimately, as long as a program manager can 

deliver the right product at the right time for the right cost, he or she is incentivized to do 

so without interference from above. Recognizing that government programs face a 

variety of barriers in creating such an environment, we have recommended that agencies 

complement their improvement efforts with more strategic planning, portfolio 

management, program manager support, and accountability. 

4. GAO has reviewed the use of award fees at several federal agencies, including NASA. 

Has NASA· s use of the award fee tool instilled better contractor performance? What are 

some examples where that was the case? 

Answer: The last time we conducted a comprehensive review of NASA's use of award 

fees was in January 2007.8 In this report, we made three recommendations to increase the 

likelihood that the award fees NASA pays incentivize high performance from its 

suppliers: 

• Reemphasize to the NASA centers the importance of tying award-fee criteria to 

desired outcomes and limiting the number of sub factors used in evaluations; 

• Direct the centers to consider costs and benefits in choosing this contract type by 

requiring documentation explaining how the perceived benefits will offset the 

additional cost associated with its administration as required by the Federal 

Acquisition Regulation; 

• Require the development of metrics for measuring the effectiveness of award fees, 

establish a system for collecting data on the use of award-fee contracts, and 

regularly examine the effectiveness of award fees in achieving desired acquisition 

outcomes. 

8GAO. NASA Procurement: Use ofAward Fees for Achieving Program Outcomes Should Be Improved, GA0-07-58 

(Washington, D.C.: Jan. !7. 2007). 

Page 5 oflO 
117 

NASA concurred with all three recommendations and took steps to implement them, 

including reemphasizing its award fee guidance to the centers through letters and 

training; revising NASA's Federal Acquisition Regulation supplement to require written 

documentation of the cost benefit analysis; and establishing a regular review to monitor 

program and project performance and to identify the root cause factors for performance 

issues. 

We have also reviewed NASA's use of award fees for the James Webb Space Telescope 

in December 2014 and December 2015: 

• In December 2014, we found that the project used NASA's award fee structure to 

implement incentives that align with cost and schedule priorities and contractors 

have been responsive to these incentives, but the evaluation criteria were not 

specified for the final evaluation of total contract performance in the project's 

performance evaluation plans.9 In order to ensure JWST's award fee contracts' final 

evaluations thoroughly and fairly evaluate contractor performance over the life of 

the contract and to provide clarity to the process that will be used for the final 

evaluation, we recommended that the NASA Administrator direct JWST project 

officials, in conjunction with the performance evaluation board tor JWST and the 

Goddard Space Flight Center fee determining official, to modify performance 

evaluation plans for its award fee contracts to ensure they (a) specify evaluation 

criteria that reflects total contract performance in advance of the final evaluation, 

and (b) clearly describe the process the performance evaluation board and fee 

detennining official will use to evaluate contractor performance in the final 

evaluation. NASA concurred with the recommendation and revised the performance 

evaluation plans for its two major contractors. 

• In December 2015, we found that although project officials evaluated workforce 

management as part of NASA's appraisal of Northrop Grumman's performance in 

its award fee determinations to incentivize the contractor to lower its workforce, the 

award fee the contractor has received was not reduced as a result of workforce size 

issues because it had worked within its budget in fiscal years 2014 and 2015. 10 

9GAO. James Webb Space Telescope: Project Facing Increased Schedule Risk with Significant Work Remaining, GA0-15-1 00 

(Washington, D.C.: Dec. 15, 2014). 

10GAO; .James Webb Space Telescope: Project on Track hut .May Benefit from Improved Contractor Data to Better Understand 

Costs, GA0-16-112 (Washington, D.C.: Dec. 17, 2015). 

Page 6 of 10 
118 

In June 2017. we also reviewed the use of on-orbit incentives-incentives based on 

successful performance in space-for satellites developed by DOD, NASA, and the 

Department of Commerce's National Oceanic and Atmospheric Administration. 1 1 

Program officials said that award fee determinations can be effective in changing 

contractor behavior. For example. one NASA program official stated that during a 

particular award fee period, they informed the contractor that it needed to address 

planning for a complicated spacecraft thermal vacuum test that was behind schedule. The 

official said that after program officials documented their concerns in award fee letters, 

contractor performance improved, resolving the issue. 

5. Technology changes at a rapid pace and often leads to new concepts for NASA missions 

and spacecraft operations. Yet, current cost models used to develop cost estimates rely 

heavily on historical experience. To what extent are cost and schedule models keeping 

pace with new concepts? 

Answer: We have not conducted a review to determine the extent to which NASA's cost 

and schedule models are keeping pace with new concepts. However, in March 2012, we 

found that the Joint Space Cost Council, of which NASA is a part, was actively working 

to improve cost credibility and realism in estimates, budgets, schedules, data, proposals, 

and program execution. 12 The organizations on the council have worked together with the 

goal of developing and enhancing cost methods. For example. at that time, one initiative 

developed a standard work breakdown stmcture that was being vetted through industry 

and government. In addition, NASA holds an annual symposium on cost estimating and 

scheduling that brings together the experts in the cost and scheduling communities within 

NASA and externally, including industry and other federal agencies, to share information 

on improving cost estimating and scheduling. 

6. Do other federal agencies use cost and schedule reserves in their development activities? 

What has been their experience? Are there any best practices NASA can apply? 

Answer: GAO's Cost Estimating and Assessment Guide states that developing a good 

cost estimate requires stable program requirements, access to detailed documentation and 

historical data, well-trained and experienced cost analysts, a risk and uncertainty analysis, 

the identification of a range of confidence levels, and adequate contingency and 

11GAO, Satellite Acquisitions: Agencies 1\Iay Recover a Limited Portion of Contract Value When Satellites Fail, GA0-17-490 

(Washington. D.C.: June 9. 2017). 

12GAO, Space Acquisitions: DOD Faces Challenges in f"""'ul(v Realizing Benefits of Satellite Acquisition Improvements, GA0-12-

5631 (Washington. D.C.: Mar. 21, 2018). The counc11 was formed in 2007 with membership across industry and military and 

civil government agencies, including DOD, National Reconnaissa~ce Office. United States Air Force, Aerospace Industries 

Association, and NASA. 

Page 7 oflO 
119 

management reserves as defined in the guide. 13 The cost guide also states that while no 

specific confidence level is considered a best practice, experts agreed that program cost 

estimates should be budgeted to at least the 50 percent confidence level, but budgeting to 

a higher level (for example, 70 percent to 80 percent, or the mean) is now common 

practice. Moreover, the experts stressed that contingency reserves are necessary to cover 

increased costs resulting from unexpected design complexity, incomplete requirements, 

technology uncertainty, and industrial base concerns, to name a few uncertainties that can 

affect programs. 

We have not conducted a government-wide review of how agencies use cost or schedule 

reserves for development activities. Other federal agencies, including DOD, the 

Department of Homeland Security (DHS), and the Department of Energy (DOE), use cost 

and schedule reserves, but not always consistently. 

• At DOD, programs and contractors may or may not hold cost and schedule reserves. 

In our 2017 review of the Amphibious Combat Vehicle's cost estimate, program 

officials told us that they interviewed subject matter experts to develop risk inputs 

for their cost estimate and then added a 30 percent contingency to those figures 

because a DOD risk and uncertainty handbook suggests that subject matter experts 

typically capture only 70 percent of risk due to optimism. 14 Conversely, in June 

2017 we found that the second Ford-Class Aircraft Carrier (CVN 79) program's 

budget is set at a confidence level well below typical risk-adjusted funding levels 

based on GAO's best practices and Navy guidance.15 As a result the current budget 

for CVN 79 construction is unlikely to cover the program costs even if there are no 

issues or schedule delays, and therefore leaves no margin for program risk or 

uncertainty. In addition, DOD contractors may hold some management reserve. 

DOD's earned value management guidance states that an allowance is made for a 

portion of the contract budget base to be withheld outside of the performance 

measurement baseline for internal management control purposes. 16 Management 

reserve is intended to provide the contractor with a budget to manage risk13GAO, GAO Cost Estimating and Assessment Guide: Best Practices for Developing and Managing Capital Program Costs. 

GA0-09-3SP (Washington. D.C.: Mar. 2. 2009). 

14GAO. Amph;bious Combat Vehicle Acquisition: Cost Estimate Meets Best Practices, but Concurrem.y between Testing and 

Production Increases Risk, GA0-17A02 (Washington. D.C.: Apr. 20 17} and Department of Defense and National Aeronautics 

and Space Administration. Joint Agency Cost Schedule Risk and Uncertainty Handbook. Mar. 12, 2014. 

15GAO. FOrd-Class Aircraft Carrier: Follow-On Ships Need More Frequent and Accurate Cost Fstimates to Avoid Pitfalls of 

Lead Ship. GAO·l7-575 (Washington, D.C.: June 13. 2017). 

16Department of Defense Earned J'alue Afanagement System Interpretation Guide, Feb, I, 2018. 

Page 8 of 10 
120 

including to react to unforeseen situations that arise during the life of a programwithin the established contract scope. 

• At DHS, programs also may or may not hold cost and schedule reserves. Program 

acquisition cost and schedule baselines are defined in terms of an objective and 

minimum threshold value, and programs are measured against the threshold value. 

According to the DHS acquisition policy on establishing cost parameters, qualifying 

major acquisition programs that are funded at the objective level below the 50 

percent confidence level require program rationale and justification, and the 

threshold value is to be set no more than 15 percent above the objective cost 

parameter. The DHS acquisition policy on establishing schedule parameters states 

that threshold values exceeding the objective value by more than three months for 

qualifying major acquisition programs lasting less than three years between the first 

acquisition decision event and full operational capability-and threshold values 

exceeding the objective value by more than six months for qualifying major 

acquisition programs lasting more than three years between the first acquisition 

decision event and full operational capability-require rationale and justification by 

the program. We plan to look at cost and schedule reserve use at DHS in a future 

review. 

• At DOE, capital asset projects, such as construction projects, are to include 

contingencies in the performance baseline. Tn addition, for capital asset projects, the 

contractor may hold management reserve to address risks. However, a November 

2014 DOE Contract and Project Management Working Group report on improving 

project management states that based on its observations of previous and ongoing 

DOE projects, underestimating contingency and planning problems have been and 

continue to be an issue. 17 For nuclear waste disposal operations activities, 

contingency funding is not included in the project's baseline. In August 2016, we 

reviewed one nuclear waste disposal operations activity-DOE's Waste Isolation 

Pilot Plant project. We found that DOE did not follow all best practices lor 

developing the cost and schedule estimates for restarting waste disposal operations 

at the plant. 18 In particular, the project's schedule did not include extra time, or 

contingency, to account for known project risks. 

17U.S. Department of Energy Contract and Project Management Working Group, Improving Project Management, Nov. 2014. 

18GAO, Nuclear fl"aste: Waste Isolation Pilot Plant Recovery Demonstrates Cost and Schedule Requirements Neededfor DOE 

Cleanup Operations. GA0-16-608 (Washington, D.C.: Aug. 4. 2016). 

Page 9 of 10 
121 

7. At the hearing, reference was made to the "watch list" provision included in the 

Majority's H.R. 5503, the National Aeronautics and Space Administration Authorization 

Act of2018. Will the watch list provide NASA the ability to restrict contractors beyond 

what is already available in the Federal Acquisition Regulation (FAR)? 

Answer: Federal agencies currently have a number of tools they can use to deal with 

poor performing contractors. Some of these tools are: 

• Agencies are generally required under Part 42 of the Federal Acquisition Regulation 

to evaluate the perfonnance of their contractors and to enter their assessments into 

the Contractor Performance Assessment Reporting System (CPARS). 

• Agencies generally must use this infonnation, which is available to them through 

the Past Perfonnance Information Retrieval System (PPJRS), in conducting 

evaluations leading to the award of new contracts. FAR§ 15.304 generally requires 

that past performance be an evaluation factor for all negotiated contracts. 

• Before awarding any new contract, agencies generally must detennine that the 

prospective contractor is responsible, meaning that the contractor has the resources 

needed to perform the contract and has a satisfactory perfonnance record, among 

other things. 

• Agencies faced with poorly performing contractors may completely or partially 

terminate contracts for default under Subpart FAR 49.4. 

• Agencies may suspend or debar contractors as appropriate. Debannent may last for 

up to three years under Subpart FAR 9 .4. The names of suspended or debarred 

contractors are listed in a database maintained by the General Services 

Administration. Such contractors are generally ineligible for the award of new 

contracts. 

In prior work, we have found that use of systems that track contractor perfonnance can 

serve as a motivating factor for contractors. For example, in our review of satellite 

contract incentives, program officials we interviewed stated that contractors react 

strongly to negative performance evaluations, as this could affect their ability to win 

future contracts. 1

9 

19GA0-17-490. 

Page 10 oflO 
122 

Responses by Mr. Steve Jurczyk 

HOUSE COMMITTEE ON SCIENCE, SPACE, AND TECHNOLOGY 

"NASA Cost and Schedule Overruns: Acquisition and Program Management Challenges" 

Mr. Stephen Jurczyk, Associate Administrator, NASA 

Questions submitted by Chairman Brian Babin. House Committee on Science. Space. and 

Technology 

I. During Rep. Dunn's questioning during the hearing, you stated that you would provide 

the Wide Field Infrared Survey Telescope (WFIRST) cost estimate in the next couple of 

weeks. You also stated that NASA has been able to adjust scope, cost, and schedule 

estimates to stay within $3.2 billion. 

a. Regarding the WFIRST mission scope review, what originally planned scientific 

instrument and spacecraft bus capabilities will no longer be included in order to 

stay within $3.2 billion? 

Answer: The 2019 Budget proposes to terminate the WFIRST mission given its 

significant cost and higher priorities within NASA. If the mission continues to be 

funded, $3.28 is the target cost estimate for the Science Mission Directorate's 

(SMD's) contribution to the mission's estimated lifecycle cost, at a 50 percent 

confidence level. This cost estimate includes SMD's contribution to the 

associated coronagraph technology demonstration, but not what the Space 

Technology Mission Directorate would have contributed to the project. 

A high level summary of the rescopes taken to reduce the estimated cost to SMD 

of WFIRST to $3.2B includes: 

• Changes in the Widefield Instrument (WFI) requirements to reduce cost and 

cost risk, including (i) specifying perfonnance at the focal plane level, rather 

than at the individual detector leveL which reduces cost by decreasing the 

time required to manufacture a full set of flight detectors; (ii) utilizing WFI 

radiator thermal margin to decrease focal plane operating temperature from 

lOOK to 95K, which reduces noise, thereby increasing detector yield and 

reducing cost; and (iii) descoping the interface for a contributed integral field 

channel (IFC), which reduces cost, given that the Canadian Space Agency 

was not able to make a commitment in a timely manner. 

• Changes in the Coronagraph Instrument (CGl) resulting from treating it as a 

technology demonstration instrument to reduce cost and cost risk, including 

(i) removing all mission-level CGI science requirements; (ii) relaxing 

mission-level CGI performance requirements to ensure healthy performance 

margins, informed by laboratory testing to date; (iii) reducing the 

coronagraph science team to level needed for technology demonstration 
123 

support; (iv) replacing the CGI science operations center pipeline with a 

coronagraph data analysis team to meet technology demonstration 

requirements; (v) eliminating CGI general observer program and replaced it 

with a participating scientist program; (vi) eliminating several coronagraph 

modes which reduce the schedule by an estimated 10 weeks; (vii) deleting 

two mask orientations, two observing modes, and two spectral bands; (viii) 

reducing CGI operations to that necessary to demonstrate technology, i.e. 

from 12 months to 3 months; and (ix) assuming contributions of CGI 

hardware from international partners. 

• Consolidations in the science operations center to reduce cost, including (i) 

reduced funding for science teams; (ii) only developing observing modes 

required by the dark energy and exoplanet surveys; (iii) reductions in 

widefield instrument science operations capability; (iv) consolidation of 

science center operations from Goddard Space Flight Center to Space 

Telescope Science Institute; and (v) assuming contribution of a pipeline from 

an international partner. 

• Engineering trades have been made that reduce costs without significant 

reductions in science, including (i) payload integration flow changed to 

eliminate need for second instmment carrier; (ii) simplified telescope door 

mechanism; (iii) eliminated dedicated payload command and data handling 

box; (iv) eliminated high gain antenna damper; and (v) adjusted or reduced 

WFI, spacecraft, and observatory integration and testing timelines. 

b. What is the total amount of headquarters reserve required for WFIRST? 

Answer: The 2019 Budget proposes to terminate WF!RST. If the mission were to 

continue to be funded, standard NASA practice is to estimate joint cost and 

schedule confidence levels (JCL) based on the integrated master schedule and 

multiple independent cost estimates developed for the preliminary design review 

(PDR) prior to approval to begin Phase C (Key Decision Point C). 

• Once the JCL has been estimated, adequate Headquarters reserve will be 

identified to bring the total WFIRST budget up to a 70 percent confidence 

level. 

• At this time (the beginning of Phase B), the mission design is not mature 

enough to estimate a JCL. However, based on the independent cost 

assessments which took place following the system requirements review 

(SRR) prior to approval to begin Phase 8 (Key Decision Point B), a range of 

cost for WFIRST was estimated. 

• The range of costs for WFIRST is $3.28 to $3.88 (SMD only). 

• The current estimate of the Headquarters reserves required for WFIRST is up 

to$605M. 

Page 2 of14 
124 

HOUSE COMMITTEE ON SCIENCE, SPACE, AND TECHNOLOGY 

''NASA Cost and Schedule Overruns: Acquisition and Program Management Challenges" 

Mr. Stephen Jurczyk, Associate Administrator, NASA 

Questions submitted bv Ranking Member Ami Bera. House Committee on Science, Space, and 

Technology 

1. After years of reporting that conditions at NASA were improving, GAO recently found 

that schedule delays and cost growth are now on the upswing. Were you surprised by the 

upswing in schedule delays and cost growth that GAO brought to light? Are both shortterm and long-term changes being considered by NASA to address the problem? If so, 

what are some examples? 

Answer: When NASA establishes a cost and schedule baseline, an associated joint cost 

and schedule confidence level (JCL) is provided alongside the cost and schedule figures. 

This confidence level is the product of a probabilistic analysis of the coupled cost and 

schedule to measure the likelihood of completing all remaining work at or below the 

budgeted levels and on or before the planned completion of the development phase. 

Although the JCL process quantitatively incorporates risks and threats, it does not 

account for two key facets that have the ability to drive cost and schedule. 

• Unknown-unknowns-- although NASA's Continuous Risk Management (CRM) 

process aims to create as comprehensive a risk register as possible, it is not feasible 

to predict all events that could possibly increase cost or schedule; 

• Uncertainty in the baseline estimate-- disregarding risks altogether, it is impossible 

to precisely predict the time or budget required to complete various segments of 

space vehicle research, development, and production. 

As a result, there is an inherent uncertainty present in the decision to proceed with 

development budgeted at a 70 percent cont1dence level, and it must be accepted that cost 

and schedule overruns will occur in some projects some of the time. NASA continues to 

work to strengthen implementation of the JCL process and the CRM process to ensure 

highly informed baseline decisions. Other items underway to bolster cost and schedule 

improvement include: 

• Looking at ways to more effectively utilize Earned Value Management (EVM) 

performance data in estimating the final costs of our m~or acquisitions; 

• Evaluating procurement approaches and contract incentives; 

• Communicating with our key stakeholders on inherent uncertainties and challenges, 

and our efTorts to mitigate them; and, 

Page 3 of 14 
125 

• Strengthening and expanding various programmatic assessment training curricula 

including electronics learning, detail/transfer opportunities among Centers, and 

partnership with other U.S. Government organizations. 

NASA utilizes Knowledge Officers, and a Chief Knowledge Officer, to ensure that all 

Centers operate as learning organizations. The NASA APPEL (Academy of 

Program/Project & Engineering Leadership) program is a resource for project 

management training. NASA schedules regular Virtual Project Management Challenges 

to train personnel and share best practices. The most recent session was held on June 21 

with the topic, "Big Lessons from Small(er) NASA Projects." 

NASA has enhanced the Cost Analysis Data Requirement (CADRe) to more formally 

capture projects' risk lists for each milestone. The goal of this enhancement is to have an 

established dataset for analysts to utilize. For example, to better inform the programmatic 

and risk management communities during JCL analysis. 

NASA is in the process of renewing its Corrective Action Plan associated with our high 

risk designation in GAO's biennial High Risk Report. As part of this plan, NASA is 

evaluating a range of enhancements and improvements for programmatic stewardship, 

including but not limited to: training curriculum implementation, contract consolidation, 

modernizing decision memoranda process, automating cost and schedule reporting. 

greater rigor on cost and schedule estimating practices, and generating clarified 

guidelines for forecast-driven and data-informed development phase programmatic 

assessment on major projects. The current target for drafting, circulating, and finalizing 

the new Corrective Action Plan is through the end of calendar year 2018. 

2. Recent instances have occurred where avoidable mistakes were committed by contractor 

personnel during fabrication, assembly, testing, and integration of spacecraft. Is there an 

underlying cause for these unforced errors and how can they be minimized? 

Answer: While progress on NASA's human spaceflight programs has been substantial, 

NASA and its contractors have faced challenges with first-time design and assembly. 

Many ofthese challenges involved unforeseen technical issues associated with the 

building of cutting-edge, large, complex aerospace systems. This critical hardware has to 

operate in the extreme environment of space, requiring the development and 

implementation of state-of-the-art processes. However, other mistakes should not be 

expected or acceptable and have been the result of failures in execution. The learning 

curve has been steep, however the long-term benefits of challenging the national 

industrial base to produce these kinds of systems is significant. NASA's focus is on ways 

to further strengthen the technical rigor within Agency and prime contractors systems 

such that those mistakes, when they happen, are promptly detected and corrected before 

Page 4 of 14 
126 

they substantively impact cost and/or schedule. Specific areas of recent systemic focus 

include: 

• processes that produce predictable, repeatable results, that are not subject to 

interpretation, and that represent the collective learning experience of the 

organization, including from preventive/corrective action from past failures and 

anomalies; 

• individuals who are properly trained in the processes, follow them in a disciplined 

way, and are authorized to call a halt if something in the process doesn't seem right; 

• accountable individuals in functions who ensure that procedures have been properly 

followed prior to sign-otT: and 

• verification and validation testing to ensure system requirements are met. 

In the case of the heavy-lift Space Launch System (SLS), NASA and core stage prime 

contractor Boeing are working methodically through issues that are not unexpected 

during the first-time production of such a large and complex piece of aerospace hardware. 

The team has overcome initial challenges in using advanced friction stir welding to 

produce the core stage liquid oxygen and liquid hydrogen tanks. Along the way, 

engineers working on the rocket have learned a great deal from meeting challenges 

(ranging from the precise alignment of weld machines to addressing the fact that tiny 

threads on welding pins affect weld strength) that have pushed the state-of-the-art for 

self-reacting friction stir welding of thicker materials. Most recently, NASA has been 

managing a slower than expected ramp up in outfitting the core stage. due in part to 

contamination recently seen in some of the propellant lines in the engine section. This 

contamination issue came from the subcontractor tubing supply chain. Investigation has 

shown this issue to be broader than SLS and involve several suppliers. It appears that the 

tubing suppliers do not have effective cleaning processes or processes that adequately 

verify cleanliness. 

NASA and Boeing have implemented a number of changes that are already having a 

positive impact on SLS core stage production. For example, senior Boeing management 

is very engaged in monitoring program progress and quickly addressing challenges as 

soon as they occur. NASA has moved additional engineering staff to Michoud to reduce 

the cycle time for solving manufacturing problems in real time. Boeing has increased onsite production labor working three shifts during the week and two shifts on weekends. 

Boeing has also set up a dedicated core stage production operations center with 

integration managers coordinating daily operations, as well as a dedicated green run 

manager to ready the first core stage for testing at the Stennis Space Center in Mississippi 

starting approximately one year prior to launch. 

Page 5 of 14 
127 

NASA also recognizes that the lessons learned from its recent experience with the James 

Webb Space Telescope have similarities to other issues we are seeing around NASA's 

development programs, including our interaction with contractors, and it is imperative for 

NASA to not only internalize these messages to lasting effect on Webb, but also across 

all of NASA's programs. Results concerning development, management and industrial 

base have been discussed among Agency leaders, and NASA will be setting up an allhands meeting with Agency development personnel so these lessons can be spread and 

discussed. 

The successful completion of the James Webb Space Telescope is critical to advancing 

our understanding of the Universe. Webb will conduct world-class science, answering 

questions about our place in the universe- Where did we come from? Are we alone? 

The data acquired with Webb will underpin many future projects. The superb 

performance of Webb's telescope and instmments during testing have made us eager to 

put them to use in space toward addressing fundamental science questions. The 

Independent Review Board (IRB) noted that Webb has "awesome scientific potential." 

Despite the challenges encountered during its integration and testing, NASA is confident 

that Webb will achieve mission success. That confidence is increased with the 

implementation of the IRB's recommendations, and mission success must be NASA's 

driving consideration moving forward. Along with the scientific community and the 

public, NASA is disappointed that completing Webb is taking longer than expected, but 

NASA is absolutely committed to successfully completing. launching, and 

commissioning Webb, and to carrying out its important scientific mission. 

3. How can NASA balance accountability and enforcement of contract provisions with the 

need to maintain a trusting, team-oriented relationship with its contractors and partners? 

Has the use of contract incentives such as award fees led to positive outcomes at NASA? 

If so, please provide some examples. What leverage does NASA have on a contractor 

when award fees are no longer available? 

Answer: NASA values the strong professional relationships that we have built with our 

contractors and partners over the years. It is through these strong relationships that we are 

able to accomplish NASA's challenging mission. It is NASA's goal to enter into 

contractual arrangements that contain fair and balanced terms and conditions that ensure 

that the contractor is incentivized to perform in an exemplary fashion in the areas of cost, 

schedule, and technical performance. We believe that such contractual arrangements can 

actually be a catalyst to building a trusting and team-oriented relationship with our 

contractors and partners. For example, NASA award fee procedures require interim 

award fee evaluations before the final award fee evaluation determination. These interim 

evaluations encourage continual communications between government and contractor 

personnel during contract performance which promotes the building of professional, 

Page 6 of14 
128 

team-oriented relationships. Many NASA flight programs and projects are high risk, and 

require special hardware or design, as well as contracting mechanisms that manage 

various risks. Every new concept for a space craft, a satellite, or rover comes to life 

through high-risk contracting. High-risk missions are always a challenge and award fee 

contracts, when used effectively, can assist in meeting the challenge of these high risk 

contracts. NASA has successfully used award fee incentives to motivate contractors to 

enhance contractor performance in the areas of cost, schedule, and technical 

performance. For example, on an award fee type contract, NASA managers made 

complaints regarding inconsistent support from the contractor. The award fee evaluation 

board for this contract was able to evaluate this performance weakness through the award 

fee process which incentivized the contractor to implement corrective actions. In another 

example, under an award fee contract, the contractor's required plan reviews were not 

providing the accuracy required by the government. The award fee evaluation board 

negatively impacted the contractor's technical score in their award fee evaluation for that 

period. This action got the contractor's attention and noticeable improvements were 

made. Beyond award fee incentives, NASA has other contractual leverage to motivate 

contractor performance ranging from partial payment withholdings for poor performance 

to recording poor contractor performance in the Contractor Performance Assessment 

Reporting System (CPARs). CPARs data is utilized by Federal Agencies in competitive 

procurements to determine a contractor's past performance record. 

4. In a 2012 report, the NASA OIG stated that funding instability can lead to inefficient 

management practices and encouraged NASA to both increase its efforts to determine the 

extent to which funding instability impacts NASA projects and to clarify the cause and 

effect relationship between funding instability and project increases, schedule delays, and 

performance problems. Has NASA implemented actions responsive to the NASA OIG's 

concern? What are examples of actions NASA has taken or is taking? 

Answer: As noted in the NASA response to the OIG findings, NASA had previously 

implemented many changes to mitigate the effects of funding instability. Formulation 

Agreements, Program Plans, Project Plans, and Decision Memoranda were implemented 

that document the agreements and expectations between the Agency and the program or 

project manager. In the Decision Memoranda, the Management Agreement (MA) defines 

the parameters and authorities over which the program or project manager has 

management control, and should be viewed as a contract between the Agency and the 

program or project manager. Any divergence from the MA that any party identifies, 

including changes in funding profiles, is to be accompanied by an amendment to the 

Decision Memorandum. These changes to internal practices facilitate identification of 

impacts, encourage discussion regarding resolution path, and document changes to the 

agreements. With regard to incremental funding, funds availability is continuously 

tracked at the project level. Any emergent issues associated with incremental funding are 

Page 7 of 14 
129 

communicated via routine channels and quickly resolved. The specific implementation of 

incremental funding varies across Mission Directorates to allow for the most efficient and 

effective means by which to fund different types of projects balanced with fiscal control 

at the Mission Directorate level. 

Also as noted in the NASA response to the OIG findings, external funding instability 

drivers are more difficult to control or influence. United States Government policies and 

priorities may change over time, and Continuing Resolutions may be in place for long 

periods of time. Instability brought on from constant Continuing Resolutions is often 

cited as a primary challenge in terms of project and program planning. NASA continues 

to seek to keep external stakeholders informed when external decisions impact a project's 

ability to deliver on NASA's Agency Baseline Commitment. NASA also continues to 

advise projects to consider the probability of a Continuing Resolution when developing 

and refining plans at the beginning of a fiscal year. 

5. Technology changes at a rapid pace and often leads to new concepts for NASA missions 

and spacecraft operations. Yet, current cost models used to develop cost estimates rely 

heavily on historical experience. 

a. To what extent are cost and schedule models keeping pace with new concepts? 

b. Is NASA supporting research and development in cost and schedule modeling? If 

so, provide examples of existing efforts. 

Answer: NASA supports the research and development of cost and schedule modeling in 

three specific ways. 

Firstly, NASA robustly collects historical cost, schedule, and technical data. Every 

NASA spaceflight project is required to produce a Cost Analysis Data Requirement 

(CADRe). Specifically, CADRe is a three-part document that describes a NASA project 

at each milestone, contains key technical parameters, and captures the estimated and 

actual cost for each element in a project. The CADRe provides historical record of cost, 

schedule, and technical project attributes so that estimators can better estimate future 

analogous projects. The first part of CADRe (Part A) describes the NASA project at each 

milestone and describes significant changes that have occurred since the last milestone. 

The second part (Part B) contains standardized templates to capture key technical 

parameters that are considered to drive cost and schedule (e.g., mass, power, data rates, 

etc.). Lastly, the third part (Part C), captures the project's cost estimate and actual life 

cycle costs. Each project produces a CADRe five times during its lifecycle (System 

Requirements Review, Preliminary Design Review, Critical Design Review, System 

Integration Review, Launch, and End of Mission) which creates a temporal look at how 

Page 8 of14 
130 

projects change, augment, or descope during their development. The primary purpose of 

the CADRe effort is to have the data available to improve NASA cost and schedule 

modeling capabilities. 

Secondly, NASA devotes resources annually to improve its models. These efforts include 

populating existing models with new CADRe data, updating methodologies based on 

community best practices, and updating cost drivers based on community best practices 

and research. Recently launched missions are incorporated in each model as quickly as 

possible to support ongoing model improvements. Cost models are used not to perfectly 

retlect the future actual cost, but to instead provide a deeper understanding of risks and 

scenarios for planning and management. 

Thirdly, NASA's cost and schedule community utilizes NASA CADRe to conduct 

research to: a) Develop new models that aim to improve estimating capability, b) 

Understand what drives cost and schedule performance, and/or c) Collect additional data 

that is not currently captured in CADRe to see if it better infonns NASA cost and 

schedule forecasting. CADRe data capture has been improved over the years based on 

previously mentioned research (e.g., schedule and risk data). NASA conducts this 

research at various levels (e.g., project, Center, Agency). Recent Agency budget for cost 

and schedule research has been effectively cut. 

Examples of research conducted are numerous. Some examples of research from 2013-

2015 can be accessed at: https://www.nasa.gov/offices/ocfo/functions/research analvsis. 

Good examples of research conducted in 2016 are: 

• NICM Instrument Class: 

https://www.nasa.L(ov/sitcs/dcfault/fi lcs/atoms/lllcs/13 ntcm missionclass 20 16nasa 

cost svmposiumllnal rcv3 ta11:ged.pdf 

• CubeSat Or Microsat Probabilistic+ Analogies Cost Tool: 

https://www.nascuwv/sites/default/liles/atoms/llles/25 compact nasa cost symposi 

um 20 16final2 tag2:ed.pdf 

Good examples of research conducted in 2017 are: 

• Schedule Estimating Relationships: 

hllps://www.nasa.gov/sites/default/liles/atoms/llles/17 2017 nasa >vmposium ser 

presentation v5 14 august 7() 17 tagged. pdf 

• Cryocooler Modeling: 

hllps:/ iwww .nasa.2:ov /sitcs/default/li lcs/atoms/lllcs/ 14 n icmcrvocoo lcr costsvmposi 

um 2017 urs linal tagl!cd.pdf 

Page 9 of 14 
131 

NASA shares community research during the annual Cost and Schedule Analysis 

Symposium. A more complete list of research over the years, including model 

improvements, can be accessed via: https://www.nasa.gov/oftices/ocfo/cost svmposium. 

6. GAO identified workforce challenges, including workforce skills and sufficiency of 

staffing, as an issue in its assessment of major projects. How does NASA factor 

workforce capabilities into its decisions on choosing whether to place mission 

development and management responsibilities at a Center or with a contractor? 

Answer: NASA's Office of Strategy and Plans provides leadership in the development 

and application of NASA's acquisition policy. This NASA Policy provides the overall 

policy framework for NASA's strategic acquisition process, augments the Agency 

governance stmcture for decision making, and supports obtaining or advancing the 

development of the systems, research, services, construction, and supplies to fulfill the 

Agency's mission and other activities which advance the Agency's statutory 

objectives. Among many considerations, this Policy requires Agency leaders to consider, 

when developing an acquisition strategy, the full spectrum of acquisition approaches, as 

appropriate, to advance the Agency's objectives, taking into consideration providing best 

value, maximizing competition, and preserving the Agency's core capabilities. In 

addition, it requires that NASA capabilities, as required by senior Agency management to 

efficiently and effectively implement the NASA Strategic Plan, are maintained, including 

workforce and infrastructure, over both the short term and long term. 

7. How does NASA determine the level of cost and schedule reserves to be included in the 

estimated cost of a program and how does NASA determine how much of these reserves 

are allocated to the project and program? 

Answer: For projects with a lifecycle cost greater than $250M, NASA uses probabilistic 

cost-loaded schedules, or Joint Cost and Schedule Confidence Level (JCL) analysis, so 

the program/project and the independent review entity can focus on the program/project 

plan. This improves program or project planning by systematically integrating cost, 

schedule, and risk products and processes. It also facilitates transparency with 

stakeholders on expectations and the probabilities of meeting those expectations. Lastly, 

it provides a cohesive and holistic picture of the program or project's ability to achieve 

cost and schedule goals and enables the determination of Unallocated Future Expenses 

(UFE) and funded schedule margins required by the program or project. UFE (i.e., 

reserves) are the portion of estimated cost required to meet the specific confidence level 

that cannot yet be allocated to the specific Work Breakdown Structure (WBS) subelements because the estimate includes probabilistic risks and specific needs that are not 

known until these risks are realized. For programs and projects that are not required to 

perform probabilistic analysis, the UFE should be informed by the program or project's 

unique risk posture in accordance with Mission Directorate and Center guidance and 

Page 10 of 14 
132 

requirements. The rationale for the UFE, if not conducted via a probabilistic analysis, 

should be appropriately documented and be traceable, repeatable, and defendable. 

Otherwise, UFE is determined by the confidence level provided by the joint cost and 

schedule calculations. For projects with a lifecycle cost greater than $250M, the goal is to 

provide sufficient understanding of the risks and associated impacts on cost and schedule 

to allow determination of a cost estimate and its associated confidence levels with the 

estimate NASA commits to extemal stakeholders. 

The Management Agreement cost figure contains sufficient UFE to meet the 50 percent 

confidence level as determined by the supporting probabilistic analysis. This UFE is 

under the control of the Project Manager. Additional UFE is held above the project level 

at the Program or Mission Directorate level sufficient to meet 70 percent confidence as 

determined by the supporting probabilistic analysis. Use of this Program or Mission 

Directorate UFE requires a change to the project's Management Agreement via the 

project's decision authority since responsibility has transferred to the project's control. 

~~:~ ,..,_I 

low Estimate 1 Management I Agreements 

1

/1\ 

I Authorized {1---U-F-E--.-1 .. Jl Formulation Cost . __ , ____ _ 

I 

UFE managed t I above the project 

UFE managed by i 

project ! 

Actual 

ormula!ion Costs 

life-cycle cost 

estimdte 

AtKDPCand 

1ubsequent ABC 

reba.se!ines. the 

A!!C and the ltf<>-

cyde cost estimate 

are equal 

During formulation KDP C During Implementation 

Note: Fig uri! is notional and not drawn to scale. 

8. Although NASA's collaboration with international partners has been critical to the 

success of many missions, some of these partnerships have encountered schedule delays. 

What are the lessons learned from instances of schedule delay with intemational 

partners? What, if any, steps can NASA take to mitigate the risks associated with 

international collaboration? 

Answer: Complications and delays can arise for an organization in any nation working 

on complex systems such as those that NASA and its international partners develops. In 

Page 11 of14 
133 

many cases, the instruments or technologies are the first of their kind and international 

collaboration, with appropriate export controls, helps leverage expertise from more than 

one nation to advance science and resolve significant technological challenges. 

International partnerships also leverage capabilities and resources that might otherwise be 

out of reach if not for the participation of other nations on science and exploration 

missions. Finally, international partnerships promote broader U.S. national goals. 

All NASA missions follow a rigorous development and design review cycle, regardless 

of whether the mission involves international partners. In cases where delays occur, 

NASA has instituted a variety of measures to improve performance including but not 

limited to increasing technical oversight, instituting independent reviews, and 

establishing more robust programmatic reporting requirements. These measures have 

been detailed in NASA policy guidance related to partnerships, such as NASA Policy 

Directive 1360.2, "Initiation and Development of International Cooperation in Space and 

Aeronautics Programs," and the NASA Space Act Agreements and Partnership Guides. 

Several of these best practices are designed to minimize the inherent risks- schedule and 

others- associated with such partnerships. Specifically. NASA takes care to ensure that 

international contributions fall within the known scientific and technical capabilities as 

well as available funding of its cooperative partners. Further, international projects 

involving a commitment of NASA resources are documented in legally binding 

agreements intended to protect NASA's investment. To minimize complexity and 

misunderstandings, the division of responsibilities between NASA and its cooperating 

partners is clearly defined in our cooperative agreements. Finally, NASA strives to 

include performance milestones in our international agreements with sufficient clarity to 

support preparation of cost estimates. sound management planning, and efficient 

agreement administration. 

9. What lessons learned from other NASA human spaceflight programs such as Shuttle, 

ISS, SLS, and Orion can be applied to the Lunar Outpost Gateway to ensure that it is 

developed and operated within cost estimates and on schedule? 

Answer: From a technical perspective, the groundwork for Gateway's capabilities is 

already being laid aboard the International Space Station (ISS), which provides heritage 

and operating experience for critical systems in areas such as environmental control and 

life support. Additionally, ISS is currently serving as a microgravity testbed to mature 

technologies for cislunar and deep space missions: a national capability that was not 

available during the design of the ISS. This critical work will continue throughout the 

operating life of the Station. The Orion crew vehicle's modern avionics, crew systems, 

and long-duration capability are all features that will also inform Gateway development. 

In addition, the Next Space Technologies for Exploration Partnerships (NextSTEP) 

contractors are currently developing Gateway ground prototypes and revealing new 

Page 12 of 14 
134 

approaches to Gateway design, operations, and technology application to lower overall 

operational costs. All of these technology maturation activities serve to reduce risk and 

bring finer resolution to the Gateway functional requirements. 

A number of lessons from NASA's experience with the commercial crew and cargo 

programs were employed to inform the acquisition strategy for the Gateway. For 

example, the Power and Propulsion Element (PPE), Habitation Element modules, and 

Logistics Elements, all will leverage commercial capabilities and plans including an 

extensive effort to develop a minimum set of NASA unique requirements and a common 

set of global interoperability standards. PPE released a draft solicitation in June, and 

inputs from industry will inform the final solicitation. Maximum use of mature 

technologies (e.g., commercial satellite technology, existing and advanced life support 

technologies) coupled with fixed-price, milestone-based contracts will serve to focus 

development effotis and minimize potential for cost, schedule, and requirements growth. 

This approach preserves program affordability by maintaining NASA costs targets, 

sharing of benefits and risks with industry, and executing development strategies that 

incorporate cost and schedule controls and incentives while adapting technical systems 

with high reliability for human spaceflight applications. 

By utilizing ongoing NextSTEP studies and prototyping activities, NASA has established 

a robust commercial engagement campaign and integrated cost of analysis and feedback 

activities to keep the aerospace industrial base informed and participating in NASA's 

strategic planning and technology drivers for cislunar and deep space exploration 

capabilities. The Gateway team has issued multiple Requests For Information to the 

domestic aerospace community seeking insights on Gateway plans supporting cislunar 

economic development, technology maturation, and science utilization. These inputs are 

under review by the Gateway systems engineering teams to identify potential design 

options that meet Government, partner and commercial needs. 

The Gateway acquisition strategy considers all available NASA contracting authorities to 

encourage responsiveness and efficiency in acquisition, including commercial service 

acquisitions, public-private partnerships, and traditional competitive procurements. The 

Gateway acquisition will benefit from lessons learned and best practices identified and 

refined through the successful award of the 32 NextSTEP contracts to date. Further, 

NASA is also proactively developing interoperability standards with domestic industry 

and international agencies to ensure broader opportunities are available for Gateway 

participation which also encourages a competitive environment to lower overall costs 

while enhancing cislunar capabilities for Government and commercial goals. 

Page 13 of 14 
135 

HOUSE COMMITTEE ON SCIENCE, SPACE, AND TECHNOLOGY 

''NASA Cost and Schedule OvetTuns: Acquisition and Program Management Challenges" 

Mr. Stephen Jurczyk, Associate Administrator, NASA 

Questions submitted by Ranking Member Eddie Bernice Johnson, House Committee on Science, 

Space. and Technology 

I. During the hearing, I inquired about key things NASA could do to minimize cost and 

schedule growth. As part of my question, I also asked what tradc-offs NASA makes when 

the agency is faced with unexpected cost growth and schedule delay. While I appreciate 

your addressing the first part of my question on what NASA was doing to minimize cost 

and schedule growth, you did not cover the issue of trade-offs, nor provide examples of 

successful trade-offs NASA has made. Please provide a more complete response to my 

question. 

~:NASA policy requires that for all applicable programs and projects required to 

have Key Decision Point Decision Memoranda, there be consistency between cost 

estimates, commitments, and budget account projections (by fiscal year) to ensure overall 

alignment with expected resources. During the budget formulation process, NASA 

assigns responsibility for managing budget accounts at the Mission Directorate 

level. These Control Account Managers (CAMs) strive to align resources to their top line 

budget control levels, even when realizing cost and schedule growth against 

commitments. When cost and schedule growth does occur, a Mission Directorate may 

elect to exercise de-scope options to stay within program commitments. lfthis is not a 

suitable option, the CAMs must propose trades within their accounts to cover the 

growth. In the rare scenario where the Agency believes the impacts are too severe to 

accept, it may explore alternatives to fund the growth outside of the account. One recent 

example where the trade was contained within the account occurred in reference to the 

InSight Mars Lander mission. The mission's cost increased from $675.1 M to $828.9M 

when the mission's launch was delayed from March of2016 to May of2018. In this 

instance, Planetary Science was able to accommodate this growth within their existing 

budget level and the growth did not impact any other Themes within the Science Mission 

Directorate, or accounts across the Agency. NASA has not had to make trades across 

accounts due to cost and schedule growth on missions since the last James Webb rebaseline in 2011. 

Page 14 of14 
136 

Responses by Mr. Paul Martin 

HOUSE COMMITTEE ON SCIENCE, SPACE, AND TECHNOLOGY 

''NASA Cost and Schedule Overruns: Acquisition and Program Management Challenges" 

Mr. Paul Martin, Inspector General, NASA 

Ouest ions submitted by Ranking Member Ami Bera. House Committee on Science. Space and 

Technology 

1. In a 2012 report, the NASA DIG stated that funding instability can lead to inefficient 

management practices and the report encouraged NASA to both increase its efforts to 

determine the extent to which funding instability impacts NASA projects and to clarify 

the cause and effect relationship between funding instability and project increases, 

schedule delays, and performance problems. Has NASA implemented actions responsive 

to your concern? What are examples of actions taken by NASA in response to your 

concern? 

Answer: NASA has taken some actions in response to concerns we raised about the 

impact offunding instability on project performance and costs. For example, NASA has 

described in various publications and guidance the importance of planning for 

unexpected funding changes and concomitant impacts on a project's cost and schedule 

performance. In January 2013, the Goddard Space Flight Center Director completed a 

study, "Cost and Schedule Growth in NASA Missions: Findings and Recommendations 

from the Explanation of Change Study and Flagship Mission Assessment," that discussed 

the importance and impact of establishing and maintaining an appropriate funding profile 

over the life of a project. Also, in 2014 NASA published the "NASA Space Flight 

Program and Project Management Handbook," that contains a section on the Federal 

budgeting process and warns of the impacts when funding is less than expected or 

delayed. 

2. Your otlice has found that contractor pertormance is a key contributor to many of the 

instances of cost growth and schedule delay. The identification of contractor performance 

as a key contributor begs the question as to the sufficiency ofNASA's oversight of its 

contractors. 

a. What are your observations on the level of contractor oversight exercised by 

NASA? 

Answer: In general, we have found the level of NASA's oversight of contractors 

varies considerably by project. For example, the Agency intentionally provides 

somewhat less oversight in the development of commercial cargo and crew 

projects, instead entering into an arrangement where the contractor demonstrates 

that its spaceflight configuration meets NASA standards. We have also found that 
137 

NASA is inconsistent in its application of controls designed to incentivize 

contractor performance, particularly in the area of award-fee incentive contracts. 

b. In your opinion, is NASA doing enough upfront thinking and communication 

about a project and its requirements in order to clearly lay out to the contractor 

what work needs to be accomplished and the resources available to get there? 

~: For the most part, we believe NASA communicates well with its 

contractors to establish requirements and budget expectations. However, we have 

found that the Agency, at times, has awarded contracts for work prior to finalizing 

requirements for a project's end-state. This has been noted in the Orion/Space 

Launch System (SLS)/Ground Systems programs as well as the facilities needed 

to test SLS components at the Marshall Space Flight Center. Detetmining and 

communicating end-state requirements to contractors prior to establishing a 

contract is beneficial in both establishing expectations for initial costs as well as 

cutting down on unexpected costs when and if requirements change. However, 

projects expected to take multiple years to complete have experienced challenges 

in this area due to the need for contractors to begin working on "long-lead items" 

that take significant time to build prior to when they are actually required for 

integration and testing. 

3. The NASA OIG has looked at NASA's workforce over the years. Have you seen any 

workforce issues that are contributing to cost and schedule growth? In your view, what 

should NASA do to ensure that it has an experienced workforce capable of mounting a 

sustained exploration campaign? 

Answer: The extent to which NASA can successfully address the challenges it faces in 

developing and retaining experienced project managers and engineers will not only affect 

the agency's ability to better manage project cost, schedule, and performance but 

ultimately its ability to sustain a long-term exploration campaign. For example, it is 

important that NASA maintain a balanced portfolio of large and small projects so that 

managers can receive on-the-job training, including making appropriate tradeoffs among 

cost, schedule, and performance goals. Likewise, to the extent that Agency engineers 

spend more time overseeing contractors rather than building spaceflight components 

limits their opportunities to gain hands-on experience and may make it more difficult for 

NASA to recruit and retain recent graduates or experienced engineers. 

Page 2 of3 
138 

4. It is not surprising that teams want to put their best foot forward while being faced with 

the competitive pressure of initiating a mission at the lowest cost. Unfortunately, in some 

cases, content or complexity is often underestimated. How can NASA incentivize its 

teams to be realistic in identifying both their requirements and resource needs? 

Answer: Incentivizing teams to develop more realistic plans and performance baselines 

will likely continue to be a challenge for NASA given that an overly optimistic culture, 

an expectation that additional funding will be made available for a major project if 

needed, and a "too big to fail" mentality pervades Agency thinking when it comes to 

larger missions. However, NASA can more consistently apply tools at its disposal such as 

the Joint Cost and Schedule Confidence Level (JCL) process across projects to help 

mitigate these issues and hold officials more accountable for managing project costs and 

performance. 

Page 3 of3 
139 

Responses by Mr. Daniel L. Dumbacher 

HOUSE COMMITTEE ON SCIENCE, SPACE, AND TECHNOLOGY 

"NASA Cost and Schedule Overruns: Acquisition and Program Management Challenges" 

Mr. Daniel L. Dumbacher, Executive Director, American Institute of Aeronautics and 

Astronautics (AJAA) 

Questions submitted by Ranking Member Ami Bera. House Committee on Science. Space. and 

Technology 

I. Parts not meeting specifications and mishandling of components during fabrication were 

identified this year as reasons for rework. Rework in tum contributes to launch date 

delays. During your tenure at NASA, how common a problem was the need for rework? 

In addition to enhancing quality control, what can NASA and industry do to ensure that 

such instances do not become the norm? 

Answer: It is essential to have good quality control and supply chain management 

throughout the program life cycle. The biggest challenges are accountability and 

continuously increasing oversight that results in unclear accountability. Clear 

accountability can be achieved with less oversight and less bureaucracy. Within the 

aerospace sector, from my perspective, the commercial manufacturing of business and 

civil aircraft have moved in a very positive direction with regards to this kind of 

accountability. These practices should be evaluated for use in the space sector. 

In addition, it is imperative that the quality control and mission assurance functions be 

staffed by high quality and experienced staff. These professionals should have design, 

development, and testing experience, and be included from the earliest stages of a 

program and concept development. 

2. How important is mentoring to retaining experience in the workforce, and do we need to 

change the way we train our future aerospace workforce so that roles, responsibilities, 

and accountability are better understood? 

Answer: It is absolutely essential for the next generation to learn lessons from those of us 

in the workforce. This is how I learned and developed my skill set as a young 

professional. Lessons need to be internalized and the best way to do that is through 

human interaction, working on real hardware activities on a team, and mentoring. 

Programs such as AIAA 's Design/Build/Fly competition in which 800 college students 

from across the country participate each year and the Team America Rocketry Challenge 

offer hands-on experience that proves invaluable to aerospace employers. Similarly, 

professional societies also play an important role with the future aerospace workforce by 

providing networking opportunities and other interactions with employers and 
140 

professionals in their field. This is apparent when thousands of students participate in 

AIAA forums and take courses from professors of practice. 

As young professionals progress from their university studies to the workplace, 

employers need to consider the use of in-house, hands-on projects to build the skills and 

capabilities for the future. Development skills necessary for the large-scale, complex 

aerospace programs are fostered and refined through involvement with hardware 

developments at the smaller scales. This needs to be a focus for NASA's and other 

government agencies' complex aerospace systems. 

3. It is not surprising that teams want to put their best foot forward while being faced with 

the competitive pressure of initiating a mission at the lowest cost. Unfortunately, in some 

cases, content or complexity is often underestimated. How can NASA incentivize its 

teams to be realistic in identifying both their requirements and resource needs? 

Answer: The problem is the contentious environment and the challenging constraints that 

are placed on the teams. These are complex, challenging programs that have never been 

developed before. Teams must be allowed the opportunity to objectively discuss and 

address risks associated with these complex programs. NASA teams do not need 

incentives; rather, they need a proper environment to address the issues and communicate 

the cost requirements for those issues. And, to be frank, the best way to incentivize 

NASA teams is to provide sufficient budgets with appropriate cost and schedule margins. 

Project teams need to be able to communicate risks and needed margins and reserves. 

The Office of Management and Budget (OMB) and Congress should assure that the 

margins are commensurate with the risks, and once agreed upon, fully support the needed 

budget. 

4. Your statement indicates concern about cost reserves becoming the first target for budget 

reduction in the Executive Branch budget and congressional appropriations processes. 

Have you seen that happen during your time at NASA? How can we avoid that from 

happening? 

~:Yes, I have seen this happen. From personal experience, SLS and Orion had to 

plan to a flat-line budget that skewed the natural program phasing in cost and in schedule. 

Inflation was explicitly not addressed at the direction of OMB, and it was made clear that 

the cost-cap was established in such a manner that it would not allow sufficient reserves. 

Per the written testimony, natural program development life cycles do not work well 

under flat-line budgets. Providing funding for the necessary program phasing is essential 

and must account for expected inflation. We have learned this lesson on the International 

Space Station development, but OMB and Congress continue to allow this to occur. 

Page 2 of4 
141 

5. Technology changes at a rapid pace and often leads to new concepts for NASA missions 

and spacecraft operations. Yet, current cost models used to develop cost estimates rely 

heavily on historical experience. To what extent are cost and schedule models keeping 

pace with new concepts? What role can colleges and universities play in enhancing 

student familiarity with the application of cost and schedule models and developing cost 

and schedule models that reflect new concepts? 

Answer: First, cost and schedule models try to keep pace with new concepts, but the 

collection of proper data and then factoring that new data into the new model must be 

addressed. This process will always lag (to some degree) behind the planning of new 

projects and programs. Efforts to update the cost models are essential for future program 

planning as technology and approaches change. 

Second, colleges and universities should require more engineering economics courses, 

which would give students the foundation and understanding of the economics associated 

with large engineering projects. Cost estimating and budgeting should also be included in 

Capstone design courses. Students will then be provided exposure to the language, 

approaches, and the important need of economic and policy analysis surrounding 

complex aerospace programs. 

6. In your prepared statement, you urge NASA to establish key metrics for doing in-house 

work and assess use of its capabilities as space privatization continues to grow. Please 

elaborate on the need for in-house work at NASA Centers, including options on how 

NASA could address that need. 

~:The agency's success stems from having technical capabilities within the 

agency. NASA's mission requires extending the boundary of human knowledge and 

experience. To accomplish goals and objectives never before achieved, the workforce 

must have knowledge of what can be done and what are the risks, and be able to develop 

the needed creative solutions. This can only come on the foundation of previous 

accomplishments and failures. 

In spite of all the commercial activity that is currently underway, continued in-house 

work at NASA is as important as ever. NASA continues to push the boundaries of 

knowledge in science, space exploration, and aeronautics. The workforce to address these 

challenges must be properly prepared with technical knowledge and real-world 

experience to conquer the unknown. 

NASA should use the Goddard Space Flight Center model of I 0 percent of the effort 

being performed in-house. This could be applied at an agency level for workforce 

development and to assure cross Center collaboration. 

Well-planned and executed public-private partnerships can make good use of 

government-developed technology and capabilities for application to the private sector. 

Page 3 of 4 
142 

For example, government test facilities can be available to assist private industry and 

utilize previous taxpayer investment. 

Page 4 of 4 
(143) 

Appendix II 

ADDITIONAL MATERIAL FOR THE RECORD
144 

DOCUMENTS SUBMITTED BY NASA 

June 14, 2018 

The Honorable Brian Babin 

Chairman, Subcommittee on Space 

U.S. House Committee on Science, 

Space, and Technology 

2321 Rayburn House Office Building 

Washington, DC 20515 

The Honorable Ami Bera 

Ranking Member. Subcommittee on Space 

U.S. House Committee on Science, 

Space, and Technology 

394 Ford House Office Building 

Washington, DC 20515 

Dear Chairman Babin and Ranking Member Bera: 

On behalf of our half million members and certification holders in the United States, the 

Project Management Institute (PM I) thanks you both for the opportunity to contribute to 

the U.S. House Committee on Science, Space, and Technology Subcommittee on 

Space hearing entitled "NASA Cost and Schedule Overruns: Acquisition and Program 

Management Challenges." 

As the world's leading not-for-profit professional association for the project, program and 

portfolio management profession, PMI works with Congress to improve the federal 

government's ability to effectively manage its portfolios of projects and programs. The 

importance of adopting leading project management practices is difficult to overstate. 

PMI's Pulse of the Profession® 2018 survey reveals that 9.9% of every dollar is wasted 

due to poor project performance-that's $99 million for every $1 billion invested! The 

data further shows that when proven project, program and portfolio management 

practices are implemented, projects and programs meet their original goals and 

business intent far more often than those without. 

As your Subcommittee continues to work with NASA to enhance our nation's leadership 

in space, PM! is pleased to share its perspective on how project, program and portfolio 

management standards and workforce development lead to greater organizational 

success and less wasteful federal government spending. 

Standards 

Coast to coast, thousands of organizations-from small businesses and Fortune 500 

companies to state and federal government agencies-across all industries, manage 

their portfolios of projects and programs using the widely-accepted American National 

Standards Institute (ANSI) standards for project, program and portfolio management. 

Within federal agencies, ANSI standards and frameworks allow for better performance 

tracking, promote flexibility and agility, foster transparency and accountability, and 
145 

The Honorable Brian Babin 

The Honorable Ami Bera 

Page 2 

ensure compliance with existing statutes and Office of Management and Budget (OMB) 

guidance (including Public Law 104-113, the "National Technology Transfer and 

Advancement Act of 1995;" Public Law 114-264, "The Program Management 

Improvement and Accountability Act," and OMB Circular No. A-119 Revised). Further, 

the U.S. Government Accountability Office (GAO) uses the ANSI standards as 

benchmarks in its project and program evaluations, including those focused on NASA. 

PMI's Pulse of the Profession® 2018 survey confirms that when organizations have mature 

value delivery capabilities, including the incorporation of ANSI-accredited standardized 

practices, project and program performance improves significantly: 

• 23% more projects and programs are completed on time 

• 20% fewer projects and programs are deemed as failures 

18% more projects and programs are completed within budget 

14% fewer projects and programs suffer from scope creep 

13% more projects and programs meet their goals and strategic intent 

Effectively leveraging standards is even more critical for organizations engaging in 

highly-complex and highly-technical projects and programs, such as the development of 

interplanetary spacecraft systems and other critical technologies currently being 

undertaken by NASA. To date, NASA has worked to align their project, program and 

portfolio management practices with the relevant ANSI standards, and PMI encourages 

NASA leadership to ensure that standardized practices are leveraged across the 

agency to better support the on-time, on-budget delivery of its projects and programs. 

Workforce development 

In Ieday's environment of constant disruption, project, program and portfolio managers 

are the bridges that connect organizational strategy to implementation. As a result, 

there is a widening gap between employers' need for these skilled workers and the 

availability of qualified professionals to fill those roles. This gap is particularly acute 

within federal agencies, where there has been a dramatic increase in the number of 

jobs requiring project-oriented skills taking place at the same time many professionals 

are retiring from the workforce. 

To deliver their portfolios of projects and programs more effectively and efficiently, 

federal agencies, including NASA, need skilled, certified project, program and portfolio 

managers. These important stewards of taxpayer dollars require a unique set of 

technical competencies, detailed in the PMI Project Manager Competency Development 

Framework-Third Edition, combined with leadership skills and strategic and business 

management expertise, as embodied in the PMI Talent Triangle. 
146 

The Honorable Brian Babin 

The Honorable Ami Bera 

Page 3 

The NASA Academy of Program/Project & Engineering Leadership (APPEL) has a 

strong track record of integrating project, program and portfolio management 

competencies into its workforce development activities and aligning its efforts with 

marketplace best practices and certifications. PMI strongly supports efforts by the Chief 

Knowledge Officer and NASA leadership to ensure the retention and continuous 

development of its workforce to achieve future success and address the opportunities 

GAO outlined in its recent NASA: Assessments of Major Projects report. 

Conclusion 

In closing, thank you again for the opportunity to highlight the importance of project, 

program and portfolio management leading practices to delivering on the 

Subcommittee's goal of sustaining U.S. leadership in space. PMI stands ready to work 

with both of you, your staffs, GAO, and NASA to ensure that NASA achieves its 

important mission. If you have any questions, or if we can provide further information, 

please contact Jordon Sims (202-772-35981 jordon.sims@pmi.org) or Tommy Goodwin 

(202-772-3592 I tommy.goodwin@pmi.org) from PMI's Washington, DC office. 

Sincerely, 

~~0.~ 

Mark A. Langley 

President and Chief Executive Officer 
147 

Material requested for the record by Representative Brooks during the June 14, 2018 

bearing at which Mr. Jurczyk testified. 

Answer: 

NASA will be able to provide the Committee with a more specific ISS Transition Report 

delivery time frame after the receipt of industry studies on ISS transition, which is slated for 

December 2018. The content of the studies will provide the Agency with a better understanding 

of industry's views about potential transition options, and this information will help inform the 

development of the second edition of the report. 
148 

Æ 

Material requested for the record by Representative Brooks during the June 14, 2018 

hearing at which Mr. Jurczyk testified. 

Answer: 

[Jurczyk: Yes, we're--like Mr. Martin said, we're--the launch services program is in the process 

of assessing that risk for all missions, and I can take a question for the record on that to get back 

with you when that assessment will be done.] 

NASA's Launch Services Program (LSP) was asked in Spring 2017 by the International Space 

Station (ISS) program to assess a 2nd flight of a Falcon 9 Block 3 or Block 4 1st stage booster. 

LSP briefed the ISS program and NASA HQ on their findings and recommendations in October 

2017. The summary from the LSP assessment was there was no discernable increase in risk for a 

Commercial Resupply Services (CRS) flight carrying cargo to the ISS through the reuse of a 

Falcon 9 1st stage booster as long as that booster has had only one prior flight; the trajectory was 

a "benign" trajectory flying to low-Earth orbit; the booster returned to a land landing; and 

SpaceX performed its post-flight inspection, repair and replace process. The Space X CRS-13 

flight successfully flew on December 6th, 2017 using a previously flown 1st stage booster that 

met the LSP provided criteria. (LSP also conducted an assessment at the request of ISS for the 

SpaceX CRS-15 flight that flew successfully on June 29th, 2018.) LSP will continue to evaluate 

Falcon 9 reusability as necessary for appropriate future NASA missions.