JUNE 2, 2011

AUDIT REPORT

REPORT NO. IG-11-018 (ASSIGNMENT NO. A-10-012-00)

OFFICE OF AUDITS

NASA’S MANAGEMENT OF THE NPOESS

PREPARATORY PROJECT

OFFICE OF INSPECTOR GENERAL

National Aeronautics and 

Space Administration
REPORT NO. IG-11-018

Final report released by:

Paul K. Martin

Inspector General

Acronyms

ATMS Advanced Technology Microwave Sounder

CERES Clouds and the Earth’s Radiant Energy System

CrIS Crosstrack Infrared Sounder

DMSP Defense Meteorological Satellite Program

DOD Department of Defense

DWSS Defense Weather Satellite System

FY Fiscal Year

GAO Government Accountability Office

GOES Geostationary Operational Environmental Satellites 

GRAIL Gravity Recovery and Interior Laboratory

IPO Integrated Program Office

JPSS Joint Polar Satellite System

MMS Magnetospheric Multiscale

NOAA National Oceanic and Atmospheric Administration

NPOESS National Polar-orbiting Operational Environmental Satellite System

NPP NPOESS Preparatory Project

NPR NASA Procedural Requirements

OMPS Ozone Mapping and Profiler Suite

POES Polar-orbiting Operational Environmental Satellite

PPBE Planning, Programming, Budgeting, and Execution 

VIIRS Visible Infrared Imaging Radiometer Suite
JUNE 2, 2011

REPORT NO. IG-11-018

OVERVIEW

NASA’S MANAGEMENT OF THE NPOESS

PREPARATORY PROJECT

The Issue

The National Polar-orbiting Operational Environmental Satellite System (NPOESS) 

Program, considered a national priority essential to meeting civilian and military weather 

forecasting, storm tracking, and climate monitoring requirements, was created in May 

1994. The NPOESS Preparatory Project (NPP) was conceived as a risk reduction

mission, providing an opportunity to demonstrate and validate new instruments; 

processing algorithms; and command, control, communications, and ground processing 

capabilities prior to launching the first of six planned NPOESS satellites. The NPP 

satellite was designed to carry the same instruments as NPOESS and to measure such 

properties as atmospheric and sea surface temperatures, humidity, land and ocean 

biological productivity, and cloud properties.

To manage the NPOESS Program a tri-agency Integrated Program Office (IPO) was 

formed and staffed by the Department of Defense (DOD), the Department of Commerce’s 

National Oceanic and Atmospheric Administration (NOAA), and NASA. In 1999, 

NASA entered into an Initial Implementation Agreement with the IPO to jointly develop 

and manage NPP for the benefit of all involved organizations. The Final Implementation 

Agreement, executed in September 2004, stipulates that the individual agencies are 

responsible for the funding, management, and development of specific portions of NPP 

on a “no exchange of funds basis.” 1

Originally, the NPP satellite was to launch in 2006, providing NASA a platform for 

continuing its collection of global climatology data and creating a bridge between the 

NASA Earth Observing System’s Terra and Aqua satellites – launched in 1999 and 2002, 

respectively, and designed with 6-year life spans – and the NPOESS satellites.

 Because of this stipulation, each partner is 

responsible for all costs incurred for the mission segments under its area of responsibility.

2

 1 The Initial Implementation Agreement identified partner responsibilities for the formulation phase of the 

effort. The Final Implementation Agreement addressed the implementation phase. A copy of the Final

Implementation Agreement, effective September 17, 2004, is in Appendix B.

 NPP’s 

launch has now slipped to October 2011.

2 On December 18, 1999, NASA launched Terra to begin collecting a new 18-year global data set on which 

to base future scientific investigations about Earth. On May 4, 2002, NASA launched Aqua to measure 

variables of the Earth’s water cycle involving water’s liquid, solid, and vapor forms. Terra and Aqua 

continue to operate, exceeding their designed 6-year operational life spans.
OVERVIEW

ii REPORT NO. IG-11-018

On February 1, 2010, NPOESS cost overruns and schedule delays led to a White House 

decision to dissolve and restructure the overarching Program. To preserve the critical 

operational weather and climate satellite system, NPOESS was divided into the NASANOAA Joint Polar Satellite System (JPSS) and the Defense Weather Satellite System 

(DWSS). Following the restructuring of the NPOESS Program, the value of NPP to 

assure continuity of essential weather and climate measurements significantly increased

in importance.

We initiated this audit to determine how well NASA managed NPP to accomplish its 

technological objectives, meet its schedule milestones, and control costs. We also 

evaluated whether NPP management identified, reported, and mitigated risks. Details of 

the audit scope and methodology are in Appendix A.

Results

Although NASA met its schedule and technical requirements for producing the NPP 

spacecraft and the instruments for which it was responsible, the other IPO partners were 

unable to deliver their three scientific instruments to NASA in a timely manner. As a 

result, NPP has experienced a 5-year launch delay and a 54 percent increase in costs. 

Originally planned for an October 2006 launch with a life-cycle cost of $560 million, 

NPP is currently scheduled to launch in October 2011, and the life-cycle cost estimate has 

grown to $864 million.3

Despite Effective Project Management, NPP Costs Continue to Grow. We found that 

NASA had implemented sound project management principles in carrying out its NPP 

responsibilities. Specifically, NASA management delivered the spacecraft and the 

instruments for which it had responsibility on schedule and within established 

milestones.

 Due to these delays, NASA incurred an additional $304 million 

in associated costs – money that could have been used for other NASA projects had NPP 

launched in 2006. Moreover, if the NPP launch is delayed to February 2012 – the next 

available launch window due to launch facility scheduling – the Project will sustain 

additional launch services and support costs (for example, maintaining personnel) of 

about $35 million. Finally, because of technical issues encountered during development 

and testing, NPP management is concerned that the instruments provided by the IPO may 

not continue to operate throughout the planned 5-year mission.

4

 NASA’s responsibilities for NPP include providing the spacecraft and the 

Advanced Technology Microwave Sounder (ATMS), integrating all instruments onto the 

spacecraft, and providing and managing launch services.5

 3 The life-cycle costs and other costs cited throughout the report are costs to NASA and do not include 

DOD or NOAA costs.

 Responsibilities assigned to 

4 This report uses the terms spacecraft and satellite interchangeably to refer to NPP.

5 Following the Nunn-McCurdy Certification of NPOESS in June 2006, NASA and NOAA recommended 

in a joint whitepaper that the Clouds and the Earth’s Radiant Energy System (CERES) instrument that 

NASA built for the first NPOESS satellite be moved onto NPP to provide continuity of coverage with 

identical instruments on Terra and Aqua.
OVERVIEW

REPORT NO. IG-11-018 iii

the IPO included providing the Crosstrack Infrared Sounder (CrIS), the Visible Infrared 

Imaging Radiometer Suite (VIIRS), and the Ozone Mapping and Profiler Suite (OMPS).

Due to the late delivery of instruments from the IPO, NASA project managers were 

confronted with unanticipated delays that caused the Agency to expend approximately 

$304 million that could have been used for other projects had the instruments been 

delivered on time and the 2006 launch date met. Moreover, the late deliveries of IPO 

instruments have compressed final system integration and testing activities and could 

delay the October 2011 launch, further increasing the launch services and support costs

NASA is responsible for funding. In addition, NPP is the last of three remaining 

missions scheduled to launch on a Delta II launch vehicle.6

Moreover, in addition to risk reduction for NPOESS, NPP was intended to fill a gap 

between the expected operational life of NASA’s Earth Observing System and the launch 

of NPOESS, thereby assuring continuity in the collection of essential weather and climate 

data. However, this aspect of NPP’s mission could be compromised by further launch

delays if NASA’s Terra or Aqua satellites fail. In addition, NPP management is 

concerned that the operational life of the instruments supplied by the IPO may be reduced 

to 3 years from the original design expectation of 7 years due to the challenges the IPO 

encountered in their development.

 These three missions 

currently share Delta II maintenance and facility costs. However, these recurring costs 

will be borne solely by NPP if, as expected, the other two missions proceed on schedule 

and NPP’s launch is further delayed.

Finally, because the Final Implementation Agreement between NASA, the IPO, and 

NOAA was executed on a “no exchange of funds” basis, each partner is responsible for 

all costs incurred for the mission segments assigned to it. Accordingly, NASA had to 

absorb the costs caused by the late delivery of instruments from the IPO. Although 

NASA identified late delivery of instruments by the IPO as a likely and significant risk to 

NPP’s cost and schedule as early as January 2005, it did not seek to modify the 

Agreement to hold the IPO accountable for the delay costs, believing that doing so would 

be inconsistent with the collaborative intent of the Agreement and would only serve to 

further delay the Project.

Management Action

We recommended that when assessing future collaborative efforts with external partners, 

the Associate Administrator for the Science Mission Directorate carefully consider the 

technical and oversight capabilities of partner agencies and the risks associated with 

 6 The other two missions are the Gravity Recovery and Interior Laboratory (GRAIL) and Aquarius. GRAIL 

is designed to fly two spacecraft in tandem orbits around the Moon in order to measure its gravity field. 

Aquarius intends to provide the first-ever global maps of salt concentrations in the ocean surface needed 

to understand heat transport and storage in the ocean.
OVERVIEW

iv REPORT NO. IG-11-018

agreements executed on a “no exchange of funds” basis. If a decision is made to move 

forward with such an agreement, NASA should ensure that its budget includes reserve 

levels commensurate with the associated risk. 

In response to a draft of this report, the Associate Administrator for the Science Mission 

Directorate concurred with our recommendations and stated that the Directorate will seek 

to structure future partnerships to align responsibilities with technical expertise and 

acquisition capability while exploring reimbursable funding arrangements or a means to 

secure timely delivery of critical project components. In addition, the Associate 

Administrator stated that in partnerships executed on a “no exchange of funds” basis, 

NASA will track the programmatic risks and adjust reserves accordingly (see Appendix C

for full Agency response). 

We consider the Associate Administrator’s comments to be responsive to our 

recommendations. The recommendations are resolved and closed. 
JUNE 2, 2011

REPORT NO. IG-11-018

CONTENTS

INTRODUCTION

Background _________________________________________ 1

Objectives __________________________________________ 7

RESULTS

NPP Has Been Adversely Impacted by Factors Outside NASA’s 

Control __________________________________________ 8

APPENDIX A

Scope and Methodology_______________________________ 15

Review of Internal Controls ____________________________ 17

Prior Coverage ______________________________________ 17

APPENDIX B

Final Implementation Agreement________________________ 18

APPENDIX C

Management Comments ______________________________ 26

APPENDIX D

Report Distribution___________________________________ 28

JUNE 2, 2011

REPORT NO. IG-11-018 1 

INTRODUCTION

Background

History of the National Polar-orbiting Operational Environmental Satellite System 

(NPOESS) and the NPOESS Preparatory Project (NPP). Polar-orbiting satellites 

provide data and imagery for weather forecasters, climatologists, academics, Government 

agencies, and the military to map and monitor changes in weather, climate, the oceans, 

and the environment. Since the 1960s, the United States has operated two polar-orbiting 

meteorological satellite systems: the Polar-orbiting Operational Environmental Satellite 

(POES) series, managed by the Department of Commerce’s National Oceanic and 

Atmospheric Administration (NOAA), and the Defense Meteorological Satellite Program 

(DMSP), managed by the Department of Defense (DOD). Currently, one POES and two 

DMSP satellites are positioned to observe Earth in early morning, midmorning, and early 

afternoon polar orbits.7

With the expectation that combining the NOAA and DOD programs would reduce 

duplication and result in significant cost savings, in May 1994 President Clinton directed 

NOAA and DOD to merge the two satellite programs into a single program capable of 

satisfying both civilian and military requirements.

8

To manage the NPOESS Program, a tri-agency Integrated Program Office (IPO) was 

formed consisting of NOAA, DOD, and NASA personnel. Each agency was assigned 

lead responsibility for specific aspects of the NPOESS Program: NOAA for management 

of the merged system and satellite operations; DOD, through the Air Force, for providing 

the majority of the acquisition personnel and acquisition infrastructure; and NASA for

facilitating development and incorporation of new technologies into the merged system.

 This combined system, known as 

NPOESS, was considered critical to the United States’ ability to maintain the data 

continuity required for weather forecasting and global climate monitoring.

NPP was conceived in 1998 as a risk reduction mission for the larger NPOESS Program. 

The NPP satellite was designed to carry several NPOESS instruments and provide the 

NPOESS Program with an opportunity to demonstrate and validate those instruments; 

processing algorithms; and command, control, communications, and ground processing 

capabilities prior to the first NPOESS satellite launch. In addition, launch of the NPP 

satellite would assure continuity of key climate measurements between the end of the 

 

7 The satellites are in a sun-synchronous polar orbit, which means that they pass over their targets on Earth 

at roughly the same local time. For example, if a morning satellite flies over Washington, D.C., at 6 a.m.

Eastern time, then roughly 3 hours later it will fly over California at 6 a m. Pacific time, and later that day 

over Tokyo at 6 a.m. Japan Standard Time.

8 Presidential Decision Directive/NSTC-2, May 10, 1994. 
INTRODUCTION

2 REPORT NO. IG-11-018 

expected operational life of two existing NASA Earth-observing satellites, Terra and 

Aqua, and the first operational NPOESS satellite.9

In November 2003, NPP was baselined at a life-cycle cost of $560 million with an 

expected launch date of October 31, 2006. Since that time, the Project has been 

rebaselined two times, with a current life-cycle cost estimate of $864 million and a launch 

date of October 2011.10

Figure 1. NPP Satellite (Artist’s Illustration)

Source: NASA Release No. 08-98, “Mission Operations Readiness 

Review for NPOESS Preparatory Project Completed,” December 16, 

2008, available online at

http://www nasa.gov/topics/earth/features/NPOESS prep project html

(accessed May 5, 2011).

During the period NPP was being planned and developed, the larger NPOESS Program

experienced significant cost overruns and delays. By September 2005, the Program had 

exceeded its baseline by more than 15 percent, and again in January 2006 by more than 

25 percent. As required by law, the Program formally notified Congress of these

increases.11

 

9 NASA launched Terra on December 18, 1999, to begin collecting a global data set for future scientific 

investigations of Earth’s climate. NASA launched Aqua on May 4, 2002, to measure variables of the 

Earth’s water cycle. Terra and Aqua were designed with expected operational lives of 6 years. Both have 

exceeded these expectations and were still operating as of May 2011.

 As a result of these cost overruns, in June 2006 the Under Secretary of 

Defense for Acquisition, Technology and Logistics reduced the scale of NPOESS from 

six to four satellites. 

10 The life-cycle costs and other costs cited throughout the report are costs to NASA and do not include 

DOD or NOAA costs.

11 The Department of Defense Authorization Act for Fiscal Year 1983 (Public Law 97-252) requires 

congressional notification if a program’s costs increase by more than 15 percent.
INTRODUCTION

REPORT NO. IG-11-018 3 

Over the next 3 years, NPOESS experienced additional cost and schedule slippage. 

Because of expected delays in the launch of NPOESS satellites, in March 2009, the 

NPOESS Program Executive Committee elevated NPP from a “risk reduction mission” to 

a “critical operational mission,” meaning that the data will be used by the scientific 

community for numerous weather prediction models. 

In June 2009, an Independent Review Team concluded that without significant 

managerial and funding adjustments, the NPOESS Program was unlikely to succeed and 

that, accordingly, there was an extreme risk to continuity of climate and weather data.12

The following is a timeline of significant events in the development of NPP.

 

On February 1, 2010, President Obama announced the dissolution and restructuring of 

NPOESS into the Joint Polar Satellite System (JPSS) and the Defense Weather Satellite 

System (DWSS). 

• May 1994 – Presidential Decision Directive creating NPOESS.

• May 1995 – NASA, NOAA, and DOD sign Memorandum of Agreement for 

NPOESS, which allows for a NASA research satellite to test NPOESS 

instruments.

• August 1998 – The NASA Office of Earth Science reviews options for a satellite 

to follow the Terra and Aqua missions and serve as a demonstration satellite for 

NPOESS.13

• November 1999 – NASA and the IPO sign Initial Implementation Agreement for 

NPP. 

• November 2003 – NPP is baselined at $560 million with a launch date of 

October 31, 2006. 

• September 2004 – NASA, IPO, and NOAA execute the Final Implementation 

Agreement for NPP.

• January 2006 – NPOESS costs increase in excess of 25 percent leading to a 

reduction in the scale of the Program. 

• June 2006 – As a result of changes and delays associated with NPOESS, NPP’s 

October 2006 launch date is postponed to a date “to be determined.” 

 

12 NPOESS Independent Review Team, Final Report, June 1, 2009, available at 

http://democrats.science house.gov/Media/file/Commdocs/hearings/2009/Oversight/17jun/IRT NPOESS

report.pdf (last accessed May 3, 2011).

13 On August 1, 2004, NASA merged the Offices of Earth Science and Space Science to form the Science 

Mission Directorate.
INTRODUCTION

4 REPORT NO. IG-11-018

• February 2008 – NPP receives its first official rebaseline to a cost of 

$803 million and a June 2010 launch date.

• March 2009 – The Program Executive Committee for NPOESS decides that 

NPP, rather than serving as a demonstration as originally planned, will provide

data for operational use.

• June 2009 – An Independent Review Team concludes that the NPOESS Program 

has an extraordinarily low probability of success and that continuity of data 

collection is at significant risk.

• February 2010 – The President announces the dissolution and restructuring of 

NPOESS into JPSS and DWSS.

• May 2010 – The launch date for NPP is set for October 25, 2011, with a life-cycle 

cost of $864 million.

• January 2011 – NASA’s Science Mission Directorate’s Program Management 

Council reviews NPP and reaffirms the $864 million life-cycle cost and the 

October 25, 2011, launch date established in May 2010.

Management of NPP. Responsibility for the development of NPP’s instruments is 

divided between NASA and the IPO. As originally planned, NASA was responsible for 

providing one instrument – the Advanced Technology Microwave Sounder (ATMS) – the 

spacecraft, integrating the instruments provided by the IPO onto the spacecraft, and 

providing and managing launch services. The IPO was responsible for developing and 

delivering to NASA three instruments: the Crosstrack Infrared Sounder (CrIS), the 

Visible Infrared Imaging Radiometer Suite (VIIRS), and the Ozone Mapping and Profiler 

Suite (OMPS).14

The Final Implementation Agreement between NASA and its NPP partners, executed in 

September 2004, stipulates that the individual agencies are responsible for the funding, 

management, and development of the portions of NPP assigned to them on a “no 

exchange of funds basis.”

Under the 2006 launch schedule, the IPO was to deliver these 

instruments to NASA by February 2005.

15

The NPP spacecraft platform was built for NASA by Ball Aerospace Technology 

Corporation (Ball Aerospace) under a fixed-price contract for $189.1 million and the 

ATMS by Northrop Grumman Aerospace Systems (Northrop Grumman) pursuant to a 

$197 million cost-plus-award-fee contract. In 2008, NASA added a sensor and an

 Because of this stipulation, each partner is responsible for all 

costs incurred for the mission segments under its area of responsibility.

 14 The OMPS consists of a Limb Sensor, a Nadir Sensor, and a Main Electrical Box.

15 The Final Implementation Agreement is reproduced in Appendix B.
INTRODUCTION

REPORT NO. IG-11-018 5

additional instrument – the Clouds and the Earth’s Radiant Energy System (CERES) – to 

its portion of NPP. The CERES instrument was built for NASA by Northrop Grumman

unrelated to NPP and had been in storage since 1999. NASA prepared CERES for flight 

on the NPP satellite at a cost of approximately $19 million.

16

Figure 2. NPP Mission Segments and Responsibilities

 The NPP spacecraft, 

instruments, and partner responsibilities are illustrated in Figure 2.

EDRs - Environmental Data Records

RDRs - Raw Data Records

SDRs - Sensor Data Records

SMD - Stored Mission Data

Source: NASA NPP Overview, July 20, 2010.

NPP was initially baselined in November 2003 with a life-cycle cost estimate of 

$560 million and a launch date of October 31, 2006. Due to late delivery of instruments 

from the IPO, NPP was rebaselined in February 2008 to a life-cycle cost estimate of 

$803 million and a launch date of June 2010 – a 43 percent cost increase and a 3-year 

schedule delay.

 16 The full cost of CERES was $52.4 million – $27.6 million from NOAA, $19.4 million from NPP, and 

$5.4 million from the Science Mission Directorate.
INTRODUCTION

6 REPORT NO. IG-11-018

NPP was subject to a second rebaseline review in November 2010. On January 21, 2011, 

the Science Mission Directorate’s Program Management Council approved NPP’s second 

rebaseline, with a revised life-cycle cost estimate of $864 million ($61 million increase) 

and a launch date of October 25, 2011 (additional delay of 2 years). The current project 

schedule provides for completion of ground system integration and testing 14 days prior 

to the October 25 launch date. Assuming the Project meets the launch date, NPP will 

have incurred a 5-year launch delay and a 54 percent overall life-cycle cost increase since 

the initial Program Commitment Agreement in 2003. Table 1 summarizes the intended 

and actual delivery dates for the instruments and spacecraft, as well as the rationale for 

the delays.

Table 1. Instrument Delivery Dates and Rationale for Late Deliveries

Instrument Provider Original 

Delivery Date

Actual 

Delivery Date

Delay 

(months) Rationale

ATMS NASA January 2004 October 2005 21

Due to the late delivery 

of the other instruments, NASA delayed 

development to phase 

delivery accordingly.

CrIS IPO April 2004 June 2010 74

Multiple failures during 

vibration testing. Cir- cuit design failures took 

1.5 years to resolve.

VIIRS IPO September 

2004

December 

2009 63 Technical failures and design issues.

Spacecraft NASA November 

2004 June 2005 7

Modifications to the 

spacecraft from addition of CERES and 

significant delays with 

the VIIRS and CrIS.

OMPS IPO February 2005 November 

2008 45

Suffered from funding 

issues because of 

VIIRS and CrIS.

CERES NASA October 2008 October 2008 0

Added by NASA to 

ensure continuity of 

data collected by Aqua.

Ground 

System IPO March 2006 July 2009 40

System integration and 

testing identified 

performance issues, 

data loss, and 

inconsistencies in the 

technical baseline.
INTRODUCTION

REPORT NO. IG-11-018 7

NPP is the last mission scheduled to launch aboard a Delta II launch vehicle. If the 

launch is delayed, the Project could find itself responsible for full costs of maintenance of 

the Delta II launch facilities and operations, which would cause additional increases to the

overall mission cost. If NPP misses the October 2011 launch date and launches in 

February 2012 (the next available launch date due to launch schedule conflicts), NASA 

estimates the cost of the Project will increase by approximately $35 million for a total 

$899.3 million in life-cycle costs.

Objectives

The overall objective of this audit was to determine how well NASA managed NPP to 

accomplish its technological objectives, meet its schedule milestones, and control costs. 

We also evaluated whether NPP management identified, reported, and mitigated risks. 

See Appendix A for details of the audit’s scope and methodology, our review of internal 

controls, and a list of prior coverage.
RESULTS

8 REPORT NO. IG-11-018

NPP HAS BEEN ADVERSELY IMPACTED BY 

FACTORS OUTSIDE NASA’S CONTROL

Although NASA met its schedule and technical requirements for the NPP spacecraft 

and instruments for which it was responsible, the IPO was unable to deliver its 

instruments to NASA in a timely manner and the Project therefore experienced 

significant schedule disruption. As a result, NASA incurred approximately 

$304 million in additional costs for NPP – money that otherwise would have been 

available to fund other NASA projects. Because the NPP Final Implementation 

Agreement was executed on a “no exchange of funds” basis, NASA rather than the 

IPO absorbed these costs. Moreover, delays and cost overruns suffered by the larger 

NPOESS Program further increased NASA’s costs for NPP, and the resultant

restructuring of NPOESS delayed NPP’s launch; additional delays could result in a 

gap in data collection. In addition, because NPP is the last mission scheduled to use 

a Delta II launch vehicle, delay of the launch beyond October 2011 would result in 

NASA absorbing additional cost increases for launch services. Finally, the IPO 

instruments’ development challenges may affect the viability of NPP’s 5-year

mission.

NPP’s Development and Launch Was Compromised by the IPO’s 

Late Delivery of Instruments

We determined that NASA took appropriate steps to ensure NPP was on schedule and 

met technical requirements. Specifically, managers implemented an earned value 

management system to track the development of ATMS and CERES and, in accordance 

with NASA requirements, implemented risk management procedures to identify, analyze, 

track, and communicate associated risks.17

To the extent possible, NASA management took steps to mitigate the impact of the IPO 

delivery delays. Specifically, rather than wait to perform risk reduction tests on the IPO 

instruments during the integration phase of the Project as originally planned, NASA 

performed these tests when the individual instruments were delivered to it. The IPO 

delivered the OMPS Nadir Sensor in November 2008, the VIIRS instrument in January 

 By November 2005, NASA had completed 

ATMS, had integrated it onto the spacecraft, and was on schedule for the planned 

October 2006 launch. However, the IPO failed to deliver its three instruments to NASA 

for integration by November 2005 as planned. When the IPO still had not delivered the 

instruments by June 2006, it became apparent to NASA management that an October 

2006 launch would not be possible.

 17 NASA Procedural Requirements (NPR) 8000.4A, “Agency Risk Management Procedural Requirements,” 

December 16, 2008.
RESULTS

REPORT NO. IG-11-018 9

2010, and the CrIS instrument in June 2010, and all instruments had been integrated onto 

the NPP spacecraft by September 2010.

Final Implementation Agreement Makes Each Partner Responsible 

for Individual Mission Segments

The Final Implementation Agreement between NASA, the IPO, and NOAA was executed 

on a “no exchange of funds” basis and does not impose financial liability on a partner that 

encounters challenges that directly increase costs for another partner. Accordingly, 

regardless of fault, each partner is responsible for all costs incurred for the mission 

segments under its area of responsibility.

Under the Agreement, NASA is responsible for the spacecraft, the ATMS instrument, 

instrument integration, launch support, and the science data segment.18,19

“Article V – Amendment and Termination” of the Final Implementation Agreement 

provides that the agreement “may be amended at any time upon the mutual consent of the 

parties.” NASA managers responsible for NPP told us that as technical problems and 

launch delays increased, they discussed with NASA Headquarters officials whether they 

should seek to amend the Final Implementation Agreement to include language that 

would make the responsible partners liable for funding the cost of any delays; however, 

the Agreement was not revised.

 The IPO is 

responsible for the CrIS, VIIRS, and OMPS instruments; the command, control, and 

communications segment; and the interface data processing segment. Technical problems 

and late delivery of the CrIS and VIIRS instruments and the OMPS Nadir Sensor directly 

affected NASA, increasing contract costs by $74.7 million and delaying NPP’s launch by 

5 years. Specifically, NASA incurred an additional $62.6 million in costs under the 

spacecraft contract with Ball Aerospace and approximately $12 million more under the 

ATMS contract with Northrop Grumman as a result of late deliveries of the IPO 

instruments and associated launch delays.

When we asked NASA officials why they did not seek to revise the Agreement, they 

stated that parties enter into this type of agreement in the spirit of collaboration, 

recognizing that such agreements can produce mutual benefits that would not be possible 

when working alone. NASA officials said that including language to make partners liable 

for the cost of delays would be contrary to the collaborative intent of the agreements and 

could result in a partner’s refusal to participate. This, in turn, would have a detrimental 

impact on NASA’s ability to accomplish missions that require effective partnerships to 

meet shared requirements. Ultimately, NASA Headquarters officials said they did not 

 18 The Implementation Agreement did not include the CERES instrument, which was added to the Project in 

2008 by NASA.

19 The science data segment is a research tool for assessing and verifying the quality of NPP data.
RESULTS

10 REPORT NO. IG-11-018

pursue an amendment to the NPP Implementation Agreement because the IPO was 

already expending the majority of its funds on NPP and any effort to recoup the additional

delay costs from the IPO would likely have led to additional delays.

We reviewed memorandums of agreement for other NASA partnerships, including 

NASA’s Geostationary Operational Environmental Satellites (GOES and GOES-R) and 

Aquarius missions to determine whether they included cost-sharing provisions in the 

event of schedule delays caused by partner organizations.20

Delays and Cost Overruns for NPOESS Further Increased NASA’s 

Costs for NPP

 We found that similar to the 

NPP Implementation Agreement these agreements do not include such provisions.

By January 2006, the baseline for NPOESS had been exceeded by at least 25 percent. As 

a result, five sensors originally planned for the NPOESS satellites were eliminated from 

the NPOESS Program and accordingly from NPP. However, NASA scientists believed 

that the ozone monitoring capabilities of one of the eliminated sensors – the OMPS Limb

Sensor – were critical to NPP’s science mission. In addition, another of the eliminated 

sensors would have collected data relating to the Earth’s radiation balance. In order to 

maintain continuity of this data, NASA decided to include the CERES instrument on the 

NPP satellite rather than on a later NPOESS flight as had originally been planned. 

Accordingly, in June 2008 NASA rebaselined NPP to include the OMPS Limb Sensor 

and the CERES instrument with a launch readiness date of June 2010.

By the fiscal year (FY) 2010 Planning, Programming, Budgeting, and Execution (PPBE)

review, the NPP budget had increased by $304 million to $864 million, a 54 percent

increase since the 2003 Program Commitment Agreement.

21

 20 GOES and GOES-R collect weather data while Aquarius measures global sea surface salinity.

 We determined that 

$213 million of this increase is attributable to the IPO’s failure to provide instruments in 

a timely manner. NASA’s decision to take responsibility for the OMPS Limb Sensor

after it had been eliminated from the NPOESS Program and to add CERES cost NASA 

an additional $12 million and $19 million, respectively. The remaining approximately 

$60 million is attributable to improvements and other adjustments NASA made to the 

Project while it was awaiting delivery of the instruments from the IPO (see Table 2). 

21 The PPBE process is a methodology for aligning resources in a comprehensive, disciplined, top-down 

approach.
RESULTS

REPORT NO. IG-11-018 11

Table 2. NPP Cost Increases

(in millions, rounded)

NPP Cost Increases

Cost at MCR

November 

2003*

Increase 

from MCR to

PPBE FY10 

NPP Total 

Life-Cycle 

Cost 

Delay Costs $ - $ 212.61 $ 212.61

NASA Costs and Opportunities:

 Ground System Updates $ 29.70 $ 14.62 $ 44.32

 ATMS Improvements $ 154.50 $ 40.68 $ 195.18 

 OMPS Limb/Re-Manifest $ - $ 12.20 $ 12.20

 CERES Addition $ - $ 19.38 $ 19.38

 Project Support $ 51.60 $ 25.87 $ 77.47

 Spacecraft Updates $ 137.00 $ 2.28 $ 139.28

 Contingency Costs $ 53.90 $ (35.91) $ 17.99

Budget Restructures:

 Mission Science Team $ - $ 9.07 $ 9.07 

 General and Administrative; Maintenance and

 Operations; and Institutional Investments $ 14.30 $ (2.40) $ 11.90 

Full Cost $ 41.80 $ 5.96 $ 47.76

Launch Services $ 77.30 $ (0.13) $ 77.17

Total $ 560.10 $ 304.23 $ 864.33

*MCR - Mission Confirmation Review

Source: NPP Deputy Project Manager, Resources

Launch Delay to 2012 Would Increase NPP’s Launch Services

Costs

NPP will be launched on a Delta II rocket. Currently, only two other missions, Aquarius, 

planned for launch in June 2011, and the Gravity Recovery and Interior Laboratory 

(GRAIL), planned for launch in September 2011, are scheduled to use a Delta II launch 

vehicle before that program is scheduled to be retired. The three missions equally share 

the post-production support costs and launch services contract costs of the Delta II 

program through the end of calendar year 2011.22

 22 Post-production support costs ensure that subcontractors with the knowledge and expertise needed to 

manufacture or repair subcomponents are available if needed.

 In addition, NPP and Aquarius, which 

will both launch from Vandenberg Air Force Base in California, share launch pad 

maintenance costs until June 2011.
RESULTS

12 REPORT NO. IG-11-018

Both Aquarius and GRAIL are expected to launch on schedule. If NPP does not, the 

Project will face increased launch costs. Because of a crowded launch schedule in late 

2011, if NPP misses its October 2011 launch date, the next possible launch date is 

February 2012, which will cost NASA about $35 million in additional costs. These costs 

comprise approximately $4.8 million per month in Project costs (for example, 

maintaining personnel) for a total of $19.2 million. Moreover, NPP would also bear a 

portion of the maintenance costs for the Vandenberg Delta II launch pad (approximately 

$14 million per year), Delta II post-production support costs (approximately $7 million 

per year), and launch services contract costs (approximately $14 million per year). These 

additional costs attributed to the launch vehicle and services are estimated to be 

$15.8 million for a February 2012 launch. If the launch is further delayed, NASA’s costs 

would continue to increase.

Delay in NPP Launch Schedule Could Result in a Gap in Data 

Continuity

As previously noted, the President announced the restructuring of NPOESS into JPSS and 

DOD’s DWSS on February 1, 2010. With regard to JPSS, NASA acts as the acquisition 

agent and is responsible for procuring and launching the satellites. NOAA is responsible 

for operating, collecting, and distributing the data collected by the satellites as well as 

funding and providing JPSS requirements. To mitigate the risk of a gap in climate data 

collection between the Terra and Aqua satellites and launch of the JPSS satellites, NPP 

needs to launch as soon as possible.

However, as part of the restructuring of NPOESS, ground system contracts were to be 

transferred from the Air Force to JPSS. This caused further delays in delivery of the 

NPOESS/NPP ground system to NASA for integration. In addition, NASA and NOAA 

had to work with the Air Force and Northrop Grumman to obtain the instrument and 

ground system hardware and contracts. In November 2010, the ground system hardware 

and contracts were transferred to JPSS.

NPP management stated that it typically takes 15 months to perform ground system 

integration and testing after integration of the last instrument, which for NPP occurred in 

June 2010. Although in theory this schedule would allow for an October 2011 launch, 

NPP management told us that they expect to encounter ground system integration issues 

that may take longer to resolve and that therefore could cause the launch to be delayed 

beyond October.
RESULTS

REPORT NO. IG-11-018 13

Concern that the Quality of the IPO Instruments May Affect the 

NPP Mission

The IPO was responsible for development and delivery of the CrIS and VIIRS 

instruments and the OMPS Nadir Sensor. According to NPP management, these 

instruments were developed in “an undisciplined environment” and experienced technical 

and structural challenges that compromised their integrity. For example, continuing 

challenges with development of the VIIRS instrument caused the IPO to turn to the 

Goddard Space Flight Center for assistance, and the CrIS instrument experienced a 

broken frame during a vibration test and additional parts were damaged during repair. 

The potential life expectancy of both VIIRS and CrIS was 7 years, 2 years beyond NPP’s 

planned 5-year mission. However, because of the challenges in development and testing, 

NPP management has expressed concern that the design life of these instruments could be 

reduced to 3 years, which would threaten NPP’s 5-year mission plan. 

Challenges Associated with Collaborations

In 2010, the National Research Council’s Committee on Assessment of Impediments to 

Interagency Collaboration on Space and Earth Science Missions found that “candidate 

projects for multiagency collaboration in the development and implementation of Earthobserving or space science missions are often intrinsically complex and, therefore costly, 

and that a multiagency approach to developing these missions typically results in 

additional complexity and cost.”23

The Government Accountability Office (GAO) has reported on several projects on which 

NASA experienced challenges with partners not meeting commitments within planned 

funding levels and established schedules.

 The Committee also found that “advocates of 

collaboration have sometimes underestimated the difficulties and associated costs and 

risks of dividing responsibility and accountability between two or more partners; they 

also discount the possibility that collaboration will increase the risk in meeting 

performance objectives.” 

24

 

23 “Assessment of Impediments to Interagency Collaboration on Space and Earth Science Missions,” 2010, 

National Research Council Assessment, available at 

 NPP was specifically cited as one such

project. Other NASA projects the GAO discussed included Aquarius and the 

Magnetospheric Multiscale (MMS). Aquarius experienced delays in development that 

increased NASA’s costs by $35.5 million and extended the launch schedule 23 months. 

For MMS, a lack of funding for instrument production by an international partner cost 

NASA $6 million to transfer the work to a domestic partner. 

http://www.nap.edu/catalog.php?record id=13042#toc (last accessed May 3, 2011).

24 “NASA: Assessments of Selected Large-Scale Projects” (GAO-11-239SP, March 2011). 
RESULTS

14 REPORT NO. IG-11-018

Recommendations, Management’s Response, and Evaluation of 

Management’s Response

When assessing future collaborative efforts with external partners, we recommend that the 

Associate Administrator for the Science Mission Directorate take the following actions:

Recommendation 1. Carefully consider the technical and oversight capabilities of partner 

agencies and the risks associated with agreements executed on a “no exchange of funds” 

basis.

Management’s Response. The Associate Administrator for the Science Mission 

Directorate concurred with the recommendation and stated that the Directorate will seek 

to structure future partnerships in a way that aligns responsibilities with both technical 

expertise and acquisition capability. The Associate Administrator also stated that the

Directorate will “studiously avoid other similarly misaligned partnerships” with 

interagency program offices and explore the use of reimbursable funding arrangements 

for non-space agency partners that would allow the Directorate to secure timely delivery 

of critical project components.

Evaluation of Management’s Response. Management’s proposed actions are 

responsive; therefore, the recommendation is resolved and closed.

Recommendation 2. If a decision is made to move forward with such an agreement, ensure 

that the budget includes reserve levels commensurate with the associated risk.

Management’s Response. The Associate Administrator for the Science Mission 

Directorate concurred with the recommendation. However, in his response he 

commented that a “no exchange of funds” agreement may be the only practical course for 

agencies that have trouble funding their own deliverables and therefore are likely to have 

even more trouble funding costs incurred by NASA due to delays on the partners’ end. 

The Associate Administrator said NASA would track these programmatic risks and adjust 

its reserve levels accordingly.

Evaluation of Management’s Response. Management’s proposed actions are 

responsive; therefore the recommendation is resolved and closed.
APPENDIXES

REPORT NO. IG-11-018 15

APPENDIX A

Scope and Methodology

We performed this audit from June 2010 through May 2011 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.

We reviewed planning, financial, and scheduling documents; NPP contracts; and risk 

management plans, as well as criteria for project management, and earned value 

management. We conducted interviews with project officials to determine whether 

NASA effectively managed NPP in support of NPOESS/JPSS to accomplish its 

technological objectives while meeting established milestones and controlling costs. We 

also reviewed internal controls as they related to the overall audit objective. The budget 

documents available for review were the November 2003 Program Commitment 

Agreement; the “Program Operating Plan 06-1 New Obligation Authority/Cost 

Summary” for FY 2006; and the “Planning, Programming, Budgeting, and 

Execution 10-1 New Obligation Authority/Cost Summary” for FY 2010, which we also 

reviewed to determine whether NPP was controlling costs. In addition, we reviewed the 

NASA Science Mission Directorate’s Program Management Council Project Decision 

Agreement, January 21, 2011.

We reviewed the NPP Project Plan (GSFC 429-02-01-07, July 12, 2005) and compared it 

to the Monthly Status Reports through September 2010. We found that NPP 

management, to the extent possible and within the confines of the September 2004 Final 

Implementation Agreement between NASA, the IPO, and NOAA, effectively monitored 

and managed the Project. In addition, we reviewed NASA project management criteria, 

NPR 7120.5D, “Space Flight Program and Project Management Requirement,” March 6, 

2007, to determine whether the Project was within NASA guidelines.

We reviewed the NPP Risk Management Plan (GSFC 429-99-01-04, January 21, 2000);

interviewed the NPP Project Manager, NPP Deputy Project Manager, Mission Systems 

Engineer/Risk Coordinator, NPP Chief Engineer, and Chief Safety and Mission 

Assurance Officer; and reviewed the NPP risk database to determine whether NPP 

management was effectively identifying, reporting, monitoring, and mitigating risks in 

accordance with NPR 8000.4A, “Agency Risk Management Procedural Requirements,” 

December 16, 2008, which is required to be implemented by every NASA project.
APPENDIX A

16 REPORT NO. IG-11-018

We reviewed instrument, spacecraft, and launch services contracts and interviewed NPP 

Contracting Officers, Senior Program Officials of the Launch Services Program/Program 

Business Office, and the Chief of Procurement for Launch Services. 

In addition, we interviewed the JPSS Deputy Program Manager and the JPSS Chief 

Engineer to determine any impacts to JPSS due to the delayed launch of NPP and 

confirmed that a delay in NPP’s launch would increase the risk of a data gap if the current 

operational satellites became nonoperational.

Use of Computer-Processed Data. We used an NPP Project Risk Information 

Management eXchange report to determine that NPP had a risk database and that it was 

implemented in accordance with NPR 8000.4A. However, we did not validate the 

accuracy of the data in the NPP Project Risk Information Management eXchange report.

We also used a management-prepared NPP Budget New Obligation Authority Summary 

of life-cycle costs and cost increases. We verified the costs by comparing them with

other source documents (see list below). From the comparison, we determined that the 

management-prepared NPP Budget New Obligation Authority Summary data was 

credible.

• NPP New Obligation Authority Budget Plan from the 2003 Mission Confirmation 

Review Presentation

• Program Operating Plan 03-1 Working Summary

• NPP New Obligation Authority Summary Program Operating Plan 04-1 Final

• NPP FY 2009 Budget Request

• NPP Mission Science Team Reconciliation of Guideline and Program Operating 

Plan 06-1 New Obligation Authority Submit

• NPP Spacecraft Contract PPBE Program Operating Plan 10-1 Cost Requirement

• ATMS Instrument Contract History

• Program Operating Plan 06-1 New Obligation Authority/Cost Summary

• PPBE 10-1 New Obligation Authority/Cost Summary

• NPP FY 2008 Congressional Budget

• NPP FY 2011 Office of Management and Budget Submission Narrative Update, 

January 2011

• NPP Monthly Launch Slip Estimate
APPENDIX A

REPORT NO. IG-11-018 17

Review of Internal Controls

We reviewed NPP policies, procedures, and internal controls to determine whether NPP 

had implemented appropriate internal controls related to NPP management, risks, lessons 

learned, and administration of contracts for compliance with NASA regulations. We 

found that NPP management had implemented an effective process to identify, document, 

evaluate, mitigate, and administer contract responsibilities in accordance with NASA and 

NPP oversight criteria. Specific internal controls reviewed included:

• NPP Project Plan, GSFC 429-02-01-07, July 12, 2005

• NPP Risk Management Plan, GSFC 429-99-01-04, January 21, 2000

• NPR 8000.4A, “Agency Risk Management Procedural Requirements,”

December 16, 2008

• NPR 7120.6, “Lessons Learned Process (Revalidated w/change 1, 01/22/10)”

• NPR 7120.5D, “NASA Space Flight Program and Project Management 

Requirement,” March 6, 2007

• ANSI/EIA-748-B-2007, “Earned Value Management Systems,” September 10, 

2007

Prior Coverage

During the last 5 years, NASA has not issued a report of particular relevance to the 

subject of this report. The GAO has issued five reports, listed below, that describe 

significant impacts to NPP due to escalating costs, schedule delays, and ineffective 

management of the NPOESS Program and its restructure to JPSS as the cause for NPP 

launch delays and cost growth. Unrestricted reports can be accessed over the Internet at 

http://www.gao.gov.

“NASA: Assessments of Selected Large-Scale Projects” (GAO-11-239SP, March 2011)

“Polar-Orbiting Environmental Satellites: Agencies Must Act Quickly to Address Risks 

That Jeopardize the Continuity of Weather and Climate Data” (GAO-10-558, May 2010)

“NASA: Assessments of Selected Large-Scale Projects” (GAO-10-227SP, 

February 2010)

“Polar-Orbiting Environmental Satellites: With Costs Increasing and Data Continuity at 

Risk, Improvements Needed in Tri-agency Decision Making” (GAO-09-564, June 2009)

“Environmental Satellites: Polar-orbiting Satellite Acquisition Faces Delays; Decisions 

Needed on Whether and How to Ensure Climate Data Continuity” (GAO-08-518, 

May 2008)
APPENDIX B

18 REPORT NO. IG-11-018

FINAL IMPLEMENTATION 

AGREEMENT
APPENDIX B

REPORT NO. IG-11-018 19
APPENDIX B

20 REPORT NO. IG-11-018
APPENDIX B

REPORT NO. IG-11-018 21
APPENDIX B

22 REPORT NO. IG-11-018
APPENDIX B

REPORT NO. IG-11-018 23
APPENDIX B

24 REPORT NO. IG-11-018
APPENDIX B

REPORT NO. IG-11-018 25
APPENDIX C

26 REPORT NO. IG-11-018

MANAGEMENT COMMENTS
APPENDIX C

REPORT NO. IG-11-018 27
APPENDIX D

28 REPORT NO. IG-11-018

REPORT DISTRIBUTION

National Aeronautics and Space Administration

Administrator

Deputy Administrator

Chief of Staff

NASA Advisory Council’s Audit, Finance, and Analysis Committee

Associate Administrator, International and Interagency Relations

Associate Administrator, Science Mission Directorate

Director, Goddard Space Flight Center

Project Manager, NPOESS Preparatory Project

Non-NASA Organizations and Individuals

Office of Management and Budget

Deputy Associate Director, Energy and Science Division

Branch Chief, Science and Space Programs Branch

Government Accountability Office

Director, NASA Financial Management, Office of Financial Management and 

Assurance

Director, NASA Issues, Office of Acquisition and Sourcing Management

Congressional Committees and Subcommittees, Chairman and 

Ranking Member

Senate Committee on Appropriations

Subcommittee on Commerce, Justice, Science, and Related Agencies

Senate Committee on Commerce, Science, and Transportation

Subcommittee on Science and Space

Senate Committee on Homeland Security and Governmental Affairs

House Committee on Appropriations

Subcommittee on Commerce, Justice, Science, and Related Agencies

House Committee on Oversight and Government Reform

Subcommittee on Government Organization, Efficiency, and Financial Management

House Committee on Science, Space, and Technology

Subcommittee on Investigations and Oversight

Subcommittee on Space and Aeronautics
REPORT NO. IG-11-018 29

Major Contributors to the Report:

Raymond Tolomeo, Director, Science and Aeronautics Research Directorate

Diane Choma, Project Manager

Gina Davenport-Brazeau, Auditor, Team Lead

Theresa Becker, Procurement Analyst

Bill Falter, Auditor
JUNE 2, 2011

REPORT No. IG-11-018

OFFICE OF AUDITS

OFFICE OF INSPECTOR GENERAL

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