EVOLVED 

EXPENDABLE 

LAUNCH VEHICLE 

DOD Is Addressing 

Knowledge Gaps in Its 

New Acquisition 

Strategy 

Report to Congressional Committees

July 2012 

GAO-12-822 

United States Government Accountability Office

GAO 

This report was revised on August 13, 2012, to correct text 

regarding the space sector survey on page 10. 
United States Government Accountability Office

Highlights of GAO-12-822, a report to 

congressional committees 

July 2012 

EVOLVED EXPENDABLE LAUNCH VEHICLE

DOD Is Addressing Knowledge Gaps in Its New 

Acquisition Strategy

Why GAO Did This Study

DOD plans to spend about $19 billion 

to acquire launch services from fiscal 

year 2013 to fiscal year 2017, and total 

program costs through 2030 are 

expected to approach $35 billion. The 

Evolved Expendable Launch Vehicle 

(EELV) program launches satellites for

military, intelligence, civil, and 

commercial customers. In 2011, the Air 

Force created a Program Executive 

Officer for Space Launch position, 

responsible for completing a new 

EELV acquisition strategy. GAO 

reported that the new strategy needed 

to be based on sufficient information, 

and made seven recommendations to 

further this goal. DOD finalized a new 

EELV acquisition strategy in November 

2011. In the 2012 National Defense 

Authorization Act, Congress required 

DOD to describe how it had 

implemented each GAO 

recommendation, and GAO to assess 

that information. This report provides

that assessment.

GAO reviewed DOD’s report and 

supporting information, program 

budgets, performance reports, and 

contracts. GAO examined recent 

defense industrial base studies, 

government audits of the prime 

contractor’s business systems, 

independent engines cost 

assessments, and comparisons of 

historical and current launch manifests. 

GAO also interviewed or obtained 

perspectives from various launch 

officials and the prime contractor. 

What GAO Recommends

GAO is making no new 

recommendations in this report. DOD 

reviewed and concurs with this report.

What GAO Found

The Department of Defense (DOD) has numerous efforts in progress to address 

the knowledge gaps and data deficiencies identified in the GAO report. Of the 

seven recommendations GAO made to the Secretary of Defense, two have been 

completely addressed. While two of GAO’s recommendations have actions 

underway that are expected to be completed, two recommendations need more 

action for completion and one has had no action taken.

Recommendation GAO assessment

Conduct an independent assessment of the health of the U.S. 

launch industrial base, paying special attention to engine 

manufacturers 

Action underway; 

expected to complete 

Reassess the block buy contract length given the additional 

knowledge DOD is gaining as it finalizes its new acquisition 

strategy

Action underway; 

expected to complete 

Work closely with the National Aeronautics and Space 

Administration (NASA) to ensure DOD has sufficient knowledge 

of NASA heavy-lift program decisions—given the potential 

bearing those decisions could have on Evolved Expendable 

Launch Vehicle (EELV) engine prices—to facilitate DOD’s ability 

to negotiate EELV launch contract prices that maximize the 

government’s investment 

Complete 

Refrain from waiving Federal Acquisition Regulation

requirements for contractor and subcontractor certified cost and 

pricing data as DOD finalizes its new EELV acquisition strategy 

Complete

Ensure launch mission assurance activities are sufficient and not 

excessive, and identify ways to incentivize the prime contractor 

to implement efficiencies without affecting mission success as 

DOD develops a new contracting structure for the EELV 

program

Some action taken; more 

action needed 

Examine how broader launch issues, such as greater 

coordination across federal agencies, can be factored into future 

launch acquisitions to increase efficiencies and cost savings 

Some action taken; more 

action needed 

Develop a science and technology plan for improving and 

evolving launch technologies. This plan should link to the 

broader space science and technology plans mandated by the 

2010 National Defense and NASA Authorization Acts 

No action taken

Source: GAO assessment of DOD actions to address recommendations in GAO-11-641. 

Since GAO’s 2011 report, DOD has completed or obtained independent cost 

estimates for two Evolved Expendable Launch Vehicle engines and completed a 

study of the liquid rocket engine industrial base. Officials from DOD, the National 

Aeronautics and Space Administration, and the National Reconnaissance Office 

have initiated several assessments to obtain needed information, and have 

worked closely to finalize new launch provider certification criteria for national 

security space launches. Conversely, more action is needed to ensure that 

launch mission assurance activities are not excessive, to identify opportunities to 

leverage the government’s buying power through increased efficiencies in launch 

acquisitions, and to strategically address longer-term technology investments. 

Some information DOD is gathering could set the stage for longer-term strategic 

planning for the program, especially in critical launch technology research and 

development decisions. Investing in a longer-term perspective for launch 

acquisitions is important to fully leverage the government’s buying power and 

maintain a healthy industrial base.

View GAO-12-822. For more information, 

contact Cristina Chaplain at (202) 512-4841 or 

chaplainc@gao.gov. 
Page i GAO-12-822 Evolved Expendable Launch Vehicle 

Letter 1 

Background 2

DOD Is Taking Action to Address Deficiencies Identified in Our 

September 2011 Report 7

Conclusions 20

Agency Comments 21

Appendix I Scope and Methodology 24

Appendix II Comments from the Department of Defense 26

Appendix III GAO Contact and Staff Acknowledgments 27

Tables

Table 1: Status of DOD Action to Address Recommendations from 

GAO-11-641 7

Table 2: Summary of ULA Business System Evaluations 15

Contents
Page ii GAO-12-822 Evolved Expendable Launch Vehicle 

Abbreviations

DACO Divisional Administrative Contracting Officer

DCAA Defense Contract Audit Agency 

DCMA Defense Contract Management Agency 

DFARS Defense Federal Acquisition Regulation Supplement

DOD Department of Defense 

EELV Evolved Expendable Launch Vehicle 

FAR Federal Acquisition Regulation 

FTC Federal Trade Commission 

NASA National Aeronautics and Space Administration 

NDAA National Defense Authorization Act

NRO National Reconnaissance Office 

OSD Office of the Secretary of Defense 

PEO Program Executive Officer 

SLS Space Launch System

ULA United Launch Alliance 

USD(AT&L) Under Secretary of Defense for Acquisition, Technology, 

and Logistics

This is a work of the U.S. government and is not subject to copyright protection in the 

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Page 1 GAO-12-822 Evolved Expendable Launch Vehicle 

United States Government Accountability Office

Washington, DC 20548 

July 26, 2012 

Congressional Committees 

The Department of Defense’s (DOD) Evolved Expendable Launch 

Vehicle (EELV) program is the primary provider of launch vehicles for 

U.S. military and intelligence satellites, as well as some civil and 

commercial satellites. DOD plans to spend about $19 billion to acquire 

launch services from fiscal year 2013 to fiscal year 2017, and total 

program costs through 2030 are expected to approach $35 billion.1

Following significant increases in estimates for launch prices, in 2009 the 

Commander of Air Force Space Command and the Director of the 

National Reconnaissance Office (NRO) determined that a new EELV 

acquisition strategy needed to be developed. Several efforts began to 

study the best way forward, and in March 2011, the Secretary of the Air 

Force created a new executive position, the Program Executive Officer 

(PEO) for Space Launch, who is responsible for, among other things, 

spearheading the effort to finalize the new EELV acquisition strategy. We 

reported in September 2011 that DOD needed to ensure the new 

acquisition strategy was based on sufficient information, and we made 

seven recommendations to the Secretary of Defense to assist in 

furthering this goal.2

 DOD generally concurred with our recommendations 

and its new EELV acquisition strategy was finalized in November 2011. 

Following our review, the Congress included a requirement in the 

National Defense Authorization Act (NDAA) for Fiscal Year 2012 that 

DOD report to congressional committees a description of how it 

implemented each recommendation contained in our report, or how it 

otherwise addressed the deficiencies we cited.3

 The fiscal year 2012 

NDAA also mandated that GAO provide an assessment to congressional 

committees of the information contained in DOD’s response. 

 

1

This amount includes spending for launch services the DOD will acquire for the National 

Reconnaissance Office. 

2

GAO, Evolved Expendable Launch Vehicle: DOD Needs to Ensure New Acquisition 

Strategy Is Based on Sufficient Information, GAO-11-641 (Washington, D.C.: Sept. 15, 

2011). 

3

National Defense Authorization Act for Fiscal Year 2012, Pub. L No 112-81, §839 (2011). 

 
 

Page 2 GAO-12-822 Evolved Expendable Launch Vehicle 

To fulfill this mandate, we reviewed DOD’s report to the Congress and 

supporting information, including documentation of efforts underway to 

obtain sufficient information to negotiate EELV contracts, recent defense 

industrial base studies, government evaluations of contractor business 

systems, program budget and performance documents, independent cost 

assessments for two EELV engines, and compared historical and current 

launch manifests. We interviewed or obtained perspectives from launch 

officials in various military and civilian government agencies, and the 

prime contractor. 

To assess the information contained in the DOD report and determine if 

the recommended action is complete or underway, we assigned one of 

the following four status assessments to each of the recommendations. 

1. Complete. The recommended action item has been accomplished. 

2. Action underway; expected to complete. Steps have been taken to 

complete the recommended action item, and the item is expected to 

be completed in the near term. 

3. Some action taken; more action needed. Steps have been taken to 

complete the recommended action item, but more action is needed. 

4. No action taken. No action has been taken to address the 

recommended action item, and the item is not expected to be 

completed. 

We conducted this performance audit from May 2012 to July 2012 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. For more information on our 

scope and methods, see appendix I. 

DOD began the EELV program in 1995 to provide a new generation of 

launch vehicles to ensure affordable access to space for government 

satellites. It resulted in two families of commercially owned and operated 

launch vehicles—Boeing’s Delta IV and Lockheed Martin’s Atlas V. It also 

includes manufacturing and launch site facilities and ground support 

Background 
 

Page 3 GAO-12-822 Evolved Expendable Launch Vehicle 

systems. Each family of launch vehicles consists of medium-, 

intermediate-, and heavy-lift vehicles.4

In 1995, DOD awarded contracts to four companies to define EELV 

system concepts and complete preliminary system designs. At the end of 

their contracts, DOD planned to choose one contractor with the most 

reliable and cost-effective design. However, in November 1997, the Office 

of the Secretary of Defense (OSD) approved maintaining two contractors, 

based on forecasts that growth in the commercial space launch market 

would support more than one launch provider and the resulting 

competition would translate into lower costs for the government. In 1998, 

DOD competitively awarded Boeing and Lockheed Martin two firm-fixed 

price contracts for Delta IV and Atlas V launch services, respectively, 

under the Federal Acquisition Regulation (FAR) provisions governing 

commercial items. Under these contracts, DOD had limited insight into 

contractor costs because certified cost or pricing data is not required in 

the acquisition of commercial items.5

 In 2000, new market forecasts 

showed a dramatic reduction in the expected demand for commercial 

launch services and the robust launch market upon which the DOD based 

the EELV acquisition strategy did not materialize. As a consequence, 

estimated prices for future contracts for launch services increased, along 

with the total cost of the program. 

In March 2005, DOD revised the EELV acquisition strategy to reflect the 

changes in the commercial market and the new role of the government as 

the primary EELV customer. This revised strategy provided two contracts 

each—Launch Capability and Launch Services—to Boeing and Lockheed 

Martin, the two launch service providers. The EELV Launch Capability 

cost-plus award fee contract was primarily for launch infrastructure (such 

as launch pads and ranges) and labor, while the EELV Launch Services 

firm-fixed price contract with a mission success incentive provision, was 

for launch services, including vehicle production. 

 

4

The Atlas V heavy lift vehicle is neither fully designed nor built. 

5

Under the FAR, the government typically has little insight into a contractor’s costs since 

contracting officers cannot require cost or pricing data when the contracting officer 

determines, among other things, that prices agreed upon are based upon adequate price 

competition or when a commercial item is being acquired. FAR § 15.403-1(b). 

Previous Acquisition 

Approach 
 

Page 4 GAO-12-822 Evolved Expendable Launch Vehicle 

The contracts were negotiated under FAR Part 15, which governs 

negotiated acquisitions. In addition, FAR Part 15 allows the contracting 

officer to obtain certified cost or pricing data from the contractor. Certified 

cost or pricing data is meant to ensure that the government has the data it 

needs to effectively negotiate a fair and reasonable price with the 

contractor. The government can waive the requirement for certified data 

in exceptional cases. As part of the negotiations process for the 2005 

EELV contracts, the government waived its requirement for certified cost 

or pricing data, and the contracts were awarded using “other than full and 

open competition procedures” under Part 6 of the FAR. 

In May 2005, Boeing and Lockheed Martin announced plans to form a 

joint venture that would combine the production, engineering, test, and 

launch operations associated with U.S. government launches of Boeing’s 

Delta and Lockheed Martin’s Atlas launch vehicles. According to both 

contractors, the joint venture, named the United Launch Alliance (ULA), 

would gain efficiencies and provide the government with assured access 

to space at the lowest possible cost by operating independently as a 

single company and providing launches on both Atlas V and Delta IV 

vehicles. Though the Federal Trade Commission (FTC) initially opposed 

the ULA joint venture because of its potential to limit competition in the 

launch industry, DOD stated the benefits of the joint venture to national 

security outweighed the loss of competition, and FTC allowed the joint 

venture to proceed. ULA officially began operations in December 2006 as 

the sole source contractor for EELV. The government, Boeing, Lockheed 

Martin, and ULA entered into novation agreements which transferred the 

obligations and liabilities of the earlier Boeing and Lockheed Martin 

contracts to ULA.6

Following ULA formation, the Air Force approved a waiver to obtain 

certified cost or pricing data from the top 104 Boeing subcontractors 

whose purchase orders valued at $650,000 or more, representing over 

$1.4 billion total. The waiver states that Boeing purchased the materials 

via commercial item contracts and thus did not require the data of its 

 

6

With respect to government contracts, a novation agreement is a legal instrument 

executed by the contractor (transferor), successor in interest (transferee), and 

government, and by which, among other things, the transferor guarantees performance of 

the contract, the transferee assumes all obligations under the contract, and the 

government recognizes the transfer of the contract and related assets. FAR § 2.101. 
 

Page 5 GAO-12-822 Evolved Expendable Launch Vehicle 

subcontractors, and that further, the prices Boeing obtained in its largequantity purchase of subcontractor hardware warranted waiving the data. 

In 2007, DOD decided to advance the EELV program from the production 

phase to the sustainment phase.7

 We reported in 2008 that this action 

significantly reduced the program’s reporting requirements to the DOD 

and the Congress, such as program cost and status information, limiting 

its own ability to oversee the program.8

 Today, ULA’s customers are 

mostly DOD, NRO, and the National Aeronautics and Space 

Administration (NASA). NASA negotiates its own contracts with ULA. 

Commercial customers have comprised less than 20 percent of ULA 

business since operations began in 2006. 

According to DOD officials, in late 2009, projected increases in EELV 

program prices prompted the Commander of Air Force Space Command 

and the Director of the NRO to reconsider the current EELV business 

model. They commissioned a team of Air Force and other DOD 

acquisition officials, NRO, and NASA officials, and contractor personnel—

known as the Tiger Team—to study the current approach to buying 

government launches, and develop a new acquisition strategy. Although 

development of the acquisition strategy shifted from the Tiger Team to the 

new PEO for Space Launch in late March 2011, the Tiger Team study 

findings and recommendations remain a cornerstone of the new 

acquisition strategy. 

Under this arrangement, DOD awarded a contract for each launch vehicle 

as needed, with a separate contract to cover the ULA’s overhead and 

facilities cost. DOD did not guarantee a specific number of launch vehicle 

orders per year to the contractor, and the quantity of launch vehicles 

needed fluctuated. The Tiger Team and other DOD launch studies have 

raised concerns regarding the unpredictable orders and low demand for 

launch vehicle components. Both DOD and ULA officials say this 

 

7

Typically, major defense acquisition programs in the production phase achieve an 

operational capability that meets mission needs; the sustainment phase begins when the 

acquired weapons or automated information systems have been fielded or deployed. In 

this phase, DOD oversight is normally reduced and program emphasis is on activities 

such as supply, maintenance, and transportation. 

8

GAO, Space Acquisitions: Uncertainties in the Evolved Expendable Launch Vehicle 

Program Pose Management and Oversight Challenges, GAO-08-1039 (Washington, D.C.: 

Sept. 26, 2008). 
 

Page 6 GAO-12-822 Evolved Expendable Launch Vehicle 

condition is contributing to rising launch costs, particularly in the area of 

engines, a primary launch cost driver. According to DOD officials, the new 

EELV acquisition strategy was developed in part to address these 

concerns, and specifically to stabilize the industrial base and to keep 

costs from escalating more. The new EELV acquisition strategy outlines 

an approach to obtain prices from ULA for launch vehicles—or more 

specifically prices for common booster cores—in a range of quantities 

over varying contract periods.9

 The pricing proposal from ULA will inform 

DOD’s EELV quantity commitment and block buy contract period. The 

block buy is expected to commit the Air Force and NRO to buy a block of 

launch vehicles each year, and commit to doing so for a specific number 

of years, instead of buying one launch vehicle at a time as was done 

under the previous acquisition approach. The block buy is subject to 

Congress funding the procurement each year. DOD officials told us that 

the department is still obtaining a significant amount of data and 

information to analyze before locking into a specific booster core quantity 

or contract length through upcoming EELV block buy contract 

negotiations. 

Finally, although no certified U.S. commercial launch capability for EELVclass payloads other than Atlas V and Delta IV exists at this time, 

domestic commercial launch providers are emerging that may satisfy 

some of DOD’s EELV-class launch vehicle needs. According to DOD 

officials, these newer providers have not yet demonstrated adequate 

reliability to provide launches for critical satellites, but may be poised in 

the future to compete with the current sole-source EELV provider, ULA. 

We reported in September that such competition could incentivize ULA 

pricing and efficiencies, potentially yielding cost savings to the 

government. 

 

9

The booster core is the main body of a launch vehicle. In the EELV program, common 

booster cores are used to build all of the Atlas V and Delta IV launch vehicles. Medium 

and intermediate launch vehicles use one core each, while the Delta IV Heavy launch 

vehicle requires three. 
 

Page 7 GAO-12-822 Evolved Expendable Launch Vehicle 

In general, DOD has been responsive to our recommendations, and 

efforts to address knowledge gaps and data deficiencies identified in our 

report should position DOD to make informed decisions on how to 

proceed with the EELV program. Of the seven recommendations made, 

six are completed or actions are underway for completion (see table 1 for 

summary of recommendations and status). DOD officials indicate that 

efforts currently planned or underway will yield sufficient information for 

Air Force contracting officials to negotiate and award EELV contracts 

supporting the new acquisition strategy. Officials say they intend to award 

a single-year “bridge” contract for launch capabilities to ensure no 

disruption to missions in the launch manifest occurs while they evaluate 

the information prior to a block buy contract award. 

Table 1: Status of DOD Action to Address Recommendations from GAO-11-641 

 Recommendation GAO assessment 

1 Conduct an independent assessment of the health of the U.S. 

launch industrial base, paying special attention to engine 

manufacturers 

Action underway; 

expected to 

complete 

2 Reassess the block buy contract length given the additional 

knowledge DOD is gaining as it finalizes its new acquisition 

strategy 

Action underway; 

expected to 

complete 

3 Work closely with NASA to ensure DOD has sufficient 

knowledge of NASA heavy-lift program decisions—given the 

potential bearing those decisions could have on EELV engine 

prices—to facilitate DOD’s ability to negotiate EELV launch 

contract prices that maximize the government’s investment 

Complete 

4 Refrain from waiving FAR requirements for contractor and 

subcontractor certified cost and pricing data as DOD finalizes 

its new EELV acquisition strategy 

Complete 

5 Ensure launch mission assurance activities are sufficient and 

not excessive, and identify ways to incentivize the prime 

contractor to implement efficiencies without affecting mission 

success as DOD develops a new contracting structure for the 

EELV program 

Some action taken; 

more action needed

6 Examine how broader launch issues, such as greater 

coordination across federal agencies, can be factored into 

future launch acquisitions to increase efficiencies and cost 

savings 

Some action taken; 

more action needed

7 Develop a science and technology plan for improving and 

evolving launch technologies. This plan should link to the 

broader space science and technology plans mandated by the 

2010 National Defense and NASA Authorization Acts 

No action taken 

Source: GAO assessment of DOD actions to address recommendations in GAO-11-641. 

DOD Is Taking Action 

to Address 

Deficiencies 

Identified in Our 

September 2011 

Report 
 

Page 8 GAO-12-822 Evolved Expendable Launch Vehicle 

Some of the activities DOD is undertaking to inform contract negotiations 

and award were underway at the time of our last report, and some have 

commenced since. We assessed the actions DOD describes in its report 

to the Congress, and in some cases identified other activities DOD is 

undertaking to obtain and incorporate needed information into upcoming 

contract negotiations and award. 

We made this recommendation because the development of the new 

EELV acquisition strategy was predicated in part on the need to stabilize 

a vulnerable launch industrial base, yet at the time of our review, we 

found that DOD lacked reliable information on the health of the industrial 

base, including the need for stabilization. DOD also lacked independent 

analysis demonstrating the effect an EELV block buy would have in 

stabilizing the industrial base. Additionally, the predicted rise in engine 

prices was a primary driver of expected increases in launch vehicle costs, 

and DOD efforts to gain insight into the price increases were still in the 

early stages. 

Action underway; expected to complete. Since our report, DOD has 

completed or obtained independent cost estimates for two EELV engines, 

completed a study of the liquid rocket engine industrial base, and begun 

efforts to develop a national rocket propulsion strategy with NASA as 

mandated by the Congress in the fiscal year 2012 NDAA. DOD is also 

participating in an in-depth assessment of the space sector industrial 

base, but the results from this effort are not expected to inform upcoming 

EELV contract negotiations and award. 

The NRO Cost Analysis Improvement Group conducted an independent 

cost assessment of the RL-10 upper stage engine, a version of which is 

used on both the Atlas V and Delta IV launch vehicles. The assessment 

examined production costs of each engine variant, existing inventory, and 

engine price estimates for the anticipated block buy of EELVs, among 

other things. Additionally, the Air Force Cost Analysis Agency conducted 

a cost assessment of the main engine used on Delta IV launch vehicles, 

known as the RS-68, that analyzed estimated and actual labor hours, 

subcontractor materials, and overhead rates. Both assessments provide 

some explanation for the increased engine price estimates in recent 

years, and contain detailed information on pricing that EELV contracting 

officials told us they can use to assure reasonable prices in upcoming 

EELV contract negotiations. 

Recommendation 1: 

Conduct an Independent 

Assessment of the Health 

of the U.S. Launch 

Industrial Base, Paying 

Special Attention to 

Engine Manufacturers 
 

Page 9 GAO-12-822 Evolved Expendable Launch Vehicle 

A December 2011 DOD report on the liquid rocket engine industrial base 

highlights recent NASA program changes that have contributed to an 

unstable supplier base. The report, issued by the Office of the Under 

Secretary of Defense for Acquisition, Technology, and Logistics 

USD(AT&L), Manufacturing and Industrial Base Policy office, indicates 

that DOD must sustain this base to meet national security space launch 

requirements, and that all of the liquid rocket engines currently supporting 

these requirements are associated with the EELV program. The report 

provides evidence of instability in the supplier base and highlights the 

need for one of the expected benefits of an EELV block buy—a 

predictable and steady rate of production. But it also concludes that 

production activities alone will not be sufficient to protect critical skills, and 

that research and development programs are required to sustain the 

industry.10

A March 2011 DOD report of the solid rocket motor industrial base 

reached similar conclusions, and supporting documentation indicates that 

DOD investment in research and development is inadequate. Both 

reports also hold industry accountable for aligning their production 

capacity with current and future market demand. We spoke with officials 

involved in these and other defense industrial base studies, who asserted 

that an EELV block buy could ameliorate some of the negative impact 

that the Space Shuttle program retirement had on the propulsion 

industrial base by “leveling out” government quantity orders, and 

providing suppliers with a predictable rate of production for the duration of 

an EELV block buy contract. 

In its fiscal year 2012 NDAA, the Congress indicated its belief that the 

sustainment of the liquid rocket engine and solid rocket motor industrial 

bases is a national challenge spanning multiple departments, and 

established a requirement for a national rocket propulsion strategy.11 The 

strategy, to be transmitted by the President, is to include details on the 

effects of NASA program cancellations on the liquid rocket engine and 

solid rocket motor industrial bases, potential mitigation plans, current and 

 

10According to the report, NASA’s Space Shuttle program has been the primary stabilizing 

factor for liquid rocket engine industrial capabilities for decades, and its recent retirement 

has put the industry in jeopardy. 

11National Defense Authorization Act for Fiscal Year 2012, Pub. L. No. 112-81, § 1095 

(2011). 
 

Page 10 GAO-12-822 Evolved Expendable Launch Vehicle 

future missile requirements and options and recommendations for 

interagency coordination to strengthen both supplier bases. According to 

DOD and NASA officials, this effort is early in development. 

In commenting on our September 2011 report, DOD indicated that 

USD(AT&L) had begun a tier-by-tier evaluation of the space sector and 

other industrial sectors, that would provide a "comprehensive 

understanding of not only the prime contractors but the subcontractors 

and suppliers" of vital components, subsystems, and services. Since that 

time, the space sector effort has evolved into a separate, parallel, and 

significantly larger effort, and its end-date is currently to be determined. 

According to Air Force officials, the partnership with Department of 

Commerce on this effort arose in part because the Department of 

Commerce has authority to compel participation and disclosure of data 

that the DOD does not have. The larger space sector evaluation is being 

conducted by the Department of Commerce, Bureau of Industry and 

Security, in cooperation with the Air Force, NRO, and NASA through a 

comprehensive survey intended to provide a greater understanding of the 

industrial supply chain that supports the development, production, and 

sustainment of products and services across the defense, intelligence 

community, civil and commercial space sectors.12 More than nine 

thousand surveys are expected to be sent to space sector companies in 

an effort to provide the U.S. Government with a baseline of the health and 

status of the space sector industrial base. Because the effort is still in the 

early stages of development and implementation, results from this survey 

are not expected to inform upcoming EELV contract negotiations or 

award. 

 

12The Department of Commerce, Bureau of Industry and Security, informed all Government 

space-related offices of the survey in Memorandum for All Government Space-Related 

Offices, Subject: Survey of the U.S. Space Industrial Base, dated September 13, 2011. 
 

Page 11 GAO-12-822 Evolved Expendable Launch Vehicle 

We reported in September 2011 that DOD was gathering data to finalize 

its EELV acquisition strategy, but that it may not allow sufficient time to 

leverage the knowledge gained before finalizing the new strategy. The 

strategy was finalized in November 2011 and states that the program 

leadership “believes it is essential to have more fidelity in the EELV 

pricing strategy before making a long term contractual commitment.” 

Despite indications in DOD’s report to the Congress that the EELV block 

buy contract will cover fiscal years 2013-2017, DOD officials emphasized 

to us that no decision on the duration and quantity of the government 

block buy commitment had been made, or would be until DOD fully 

analyzes the information it plans to obtain. DOD officials indicate that 

DOD intends to award a single-year bridge contract in fiscal year 2013 for 

EELV launch capabilities to ensure DOD has sufficient time prior to EELV 

block buy contract negotiations and award to incorporate the information 

generated by this approach. 

Action underway; expected to complete. DOD has initiated an 

approach to obtain critical information prior to negotiating and awarding a 

new EELV block buy contract. The approach addresses deficiencies 

indentified in our report, including both the lack of a detailed risk analysis 

of planned launches using DOD satellite program knowledge, and data 

supporting contractor and subcontractor prices. Additionally, DOD has 

assembled an independent team of retired military personnel with 

experience in space launch, to assess the predicted production, 

processing and launch capacity of potential new launch providers who 

may ultimately compete with ULA for EELV-class launches. Preliminary 

results of all three assessments are expected later this summer. 

When we reported last, DOD had not assessed whether the satellites 

planned for launch during fiscal years 2013-2017 would proceed as 

scheduled. Without a confidence assessment of the planned launches, 

we pointed out that DOD did not have a clear picture of the likely number 

of launch vehicles it would need for that time period. We also noted that if 

actual DOD launch rates followed historical ones, DOD could find itself 

with a significant oversupply of launch vehicles, potentially requiring 

storage, retest, and retooling. According to DOD officials, the Air Force’s 

Space and Missile Systems Center is assessing the confidence 

associated with each of the satellites planned for launch during the fiscal 

year 2013-2017 time frame that will inform the likely number of launch 

Recommendation 2: 

Reassess the Block Buy 

Contract Length Given the 

Additional Knowledge 

DOD Is Gaining as It 

Finalizes Its New 

Acquisition Strategy 
 

Page 12 GAO-12-822 Evolved Expendable Launch Vehicle 

vehicles needed for that period of time.13 DOD launch officials indicate 

that the results of the confidence assessment will be weighed in 

determining the terms of the EELV block buy contracts. 

Another deficiency we identified in our last report was the lack of cost or 

pricing data to support EELV prime contractor and subcontractor 

proposals. For over a decade, EELV contracting officials have been 

unable to access subcontractor cost or pricing data for hardware used on 

Delta IV booster cores, and DOD contract auditors have consistently 

found ULA proposals inadequate as a basis to negotiate contracts. To 

address the lack of cost or pricing data, DOD is planning to conduct an indepth cost analysis of proposals from ULA and its subcontractors prior to 

EELV contract negotiations and award. In cases where no data exists, 

DOD officials indicate they intend to develop government estimates 

based on commercial products and historical pricing trends. Most 

significant to EELV contract negotiations may be an in-depth government 

analysis of ULA and subcontractor pricing data, some analysis of which is 

currently underway in advance of ULA’s certified pricing proposal 

submission. 

In its certified pricing proposal expected later this summer, ULA will 

present price proposals for its Atlas V and Delta IV booster cores to cover 

different launch quantities across several contract lengths. DOD officials 

indicate they will attempt to obtain subcontractor materials and labor pool 

costs to support an in-depth, full evaluation of the pricing proposal 

submitted by ULA prior to contract negotiations and award. According to 

DOD and ULA officials, some of the data requests are already underway. 

The PEO for Space Launch indicates that these evaluations will undergo 

peer review by senior pricing officials in the Office of the Secretary of 

Defense prior to contract award. 

Another assessment that will take place prior to EELV contract award is 

an evaluation of the potential production capability and technology 

development status of a new launch provider, and potential competitor of 

ULA. DOD has authorized an assessment of a launch vehicle provider 

 

13According to Air Force officials, the satellite confidence assessment will be based on 

information from individual satellite program offices and contractors relating to the 

development status, cost increases, schedule delays, and overall readiness to meet 

planned launch dates, for each satellite currently planned for launch between fiscal years 

2013 and 2017. 
 

Page 13 GAO-12-822 Evolved Expendable Launch Vehicle 

who may in the future be certified by the Air Force to compete with ULA 

for EELV-class missions. The assessment is being conducted by retired 

Air Force personnel with launch expertise. The results of this assessment 

are expected to be finalized by the end of the fiscal year. DOD officials 

stress that competition for national security space launches is a priority, 

and recognize that the results of this assessment could inform strategic 

planning for the EELV program. Gaining an understanding of the potential 

production capacity and development timeframes of emerging 

competitors to ULA can contribute to informed decisions as DOD 

evaluates and negotiate sole-source proposals for the upcoming EELV 

block buy. 

At the time of our report, NASA had not finalized the design of its heavylift Space Launch System (SLS), which could have potentially included 

one of the same engines currently used on EELVs. DOD cost evaluators 

noted that the decision to use the same engine could significantly lower 

the price of that engine to DOD, as infrastructure and labor costs would 

likely have been shared across both agencies. Accordingly, knowledge of 

NASA’s design plans could have better positioned DOD to negotiate 

EELV contracts. 

Complete. Since our report last September, DOD has worked with NASA 

to keep apprised of SLS heavy-lift decisions that could have bearing on 

EELV contract negotiations, leverage knowledge across agencies, and 

coordinate some limited technology development, according to officials at 

both agencies. According to NASA officials, NASA finalized design plans 

for its SLS heavy-lift launch vehicle late last year and provided a briefing 

to DOD summarizing its decisions. The NASA SLS vehicle will not use 

the RS-68 engine that is currently used on EELVs, and will instead use an 

RS-25D as its main engine—this was also the Space Shuttle main 

engine—and a newer J-2X engine for the upper stage engine. NASA will 

use the RS-25Ds already in NASA’s inventory from the Space Shuttle 

program, which officials say provided the earliest path at the lowest cost 

for developing a heavy lift capability, as using the RS-68 engine would 

have required design modification and added development cost. DOD 

reported to the Congress that the use of the RS-25 and J-2X engines in 

the SLS program will likely have a positive impact on the EELV supplier 

business base, possibly resulting in lower overhead rates to DOD, the 

NRO, and NASA for EELVs. NASA officials added that while the supplier 

base for the RS-68 and RS-25 production lines are not identical, the 

manufacturer of both engines is the same, and plans to bolster its 

supplier base by maximizing commonality in the supply chain for both 

Recommendation 3: Work 

Closely with NASA to 

Ensure DOD Has Sufficient 

Knowledge of NASA 

Heavy-Lift Program 

Decisions 
 

Page 14 GAO-12-822 Evolved Expendable Launch Vehicle 

engines. In addition to discussing SLS design and development progress, 

launch officials at both agencies told us they meet quarterly to share 

knowledge resulting from launch acquisitions and operations, new entrant 

certification, and space industrial base studies. 

On May 2, 2007, the Air Force waived the requirement for Boeing to 

provide certified cost or pricing data for a significant amount of hardware 

associated with the production contract. The hardware is still being used, 

and the waiver, while officials believe it afforded DOD a reduced price, 

has limited government insight into cost or pricing data on a large lot of 

launch vehicle hardware, including engines, purchased at that time. The 

lack of certified cost or pricing data for this hardware has contributed to 

years of Defense Contract Audit Agency (DCAA) reports that consistently 

find ULA proposals inadequate for government evaluation and contract 

negotiation. Given that the waiver limited government insight into the 

reasonableness of launch vehicle prices, we recommended that DOD 

refrain from waiving such requirements under its new acquisition strategy 

and subsequent EELV block buy. 

Complete. DOD indicates it has no intention of waiving FAR 

requirements for certified cost or pricing data in implementing the EELV 

acquisition strategy. According to DOD officials, a government cost 

assessment team plans to obtain and analyze a sample of the missing 

subcontractor cost or pricing data. The team will also assess prices for 

ULA’s existing launch vehicle inventory intended for use under the 

upcoming block buy—DOD estimates the excess inventory values 

between $260-300 million. DCAA will be involved in reviewing contractor 

and subcontractor proposals and cost or pricing data, and though DCAA 

officials expressed concern that they may not have time to do so prior to 

contract award, DOD officials indicate DOD will not award new EELV 

contracts prior to DCAA evaluation of these proposals. ULA business 

systems determine the output or cost data which goes into proposed 

contracts and provides a reasonable basis for the government to 

negotiate a contract deal. DCAA audits of these systems may still find 

deficiencies. 

In addition to insufficient cost or pricing data, our previous report 

highlighted DCAA findings that some ULA business systems were 

inadequate or immature. We made no recommendations related to the 

business systems, as audits were planned or underway at the time of our 

last report. Both DCAA and the Defense Contract Management Agency 

(DCMA) have continued to evaluate ULA’s six business systems and 

Recommendation 4: 

Refrain from Waiving FAR 

Requirements for 

Contractor and 

Subcontractor Certified 

Cost and Pricing Data as 

DOD Finalizes Its New 

EELV Acquisition Strategy 
 

Page 15 GAO-12-822 Evolved Expendable Launch Vehicle 

subsystems to determine their compliance with the Defense Federal 

Acquisition Regulation Supplement (DFARS). If the audits result in 

findings of significant deficiencies that rise to the level of a material 

weakness in the system, DCAA would report those deficiencies as 

potentially noncompliant with the business system criteria. See table 2 for 

the status of ULA business systems evaluations as of July 2012. 

Following each evaluation, and in some cases, corrective actions by ULA, 

the DCMA Divisional Administrative Contract Officer (DACO) will make a 

final determination of the adequacy or compliance of the system. 

Table 2: Summary of ULA Business System Evaluations 

Business system Lead agency DACO determination Status of evaluation 

Accounting DCAA Not evaluated, final determination 

expected September 2012 

Final DCAA audit report February 2012 identified 

10 DFARS noncompliances out of 18 

Estimating DCAA Not evaluated, final determination date 

unknown 

Final DCAA audit report expected August 2012 

Earned Value 

Management 

DCMA Approved (initial), final determination 

date unknown 

DCMA validation review April 2012 identified 8 

high-risk deficiencies; ULA provided its response 

on June 4, 2012 

Material Management 

& Accounting 

DCAA Not evaluated, final determination date 

unknown 

Expected start date November 2012 

Property Control DCMA Approved February 2012 

Purchasing DCMA Approved September 2011 

Source: GAO analysis of DCAA and DCMA data. 

We reported in September 2011 that DOD has little insight into the costs, 

adequacy or excess of its mission assurance activities. Industry and DOD 

studies describe launch mission assurance as activities undertaken 

throughout the lifecycle of a launch vehicle development program and 

through launch to assure success and safety. DOD officials maintained at 

the time of our last report that mission assurance costs may not be 

severable from the many launch activities in which they are integrated, 

and that the level of effort required to quantify them would likely be 

outweighed by any cost savings identified in the process. 

Some action taken; more action needed. DOD restructured the EELV 

Launch Capability contract from a cost-plus award fee-, to a cost-plus 

incentive fee contract, to incentivize ULA to find efficiencies and reduce 

Recommendation 5: 

Ensure Launch Mission 

Assurance Activities Are 

Sufficient and Not 

Excessive, and Identify 

Ways to Incentivize the 

Prime Contractor 
 

Page 16 GAO-12-822 Evolved Expendable Launch Vehicle 

costs while maintaining mission assurance.14 This change affords ULA 

flexibility in determining the areas in which efficiencies can be gained 

without being overly prescriptive. Additionally, Air Force officials recently 

conducted a comprehensive evaluation of missions in the launch manifest 

with an eye toward reducing redundant steps in the independent launch 

verification matrix.15 Air Force officials said that while the verification 

activities for each mission have always been tailored on a case-by-case 

basis at the start of a launch vehicle acquisition, the current missions in 

the launch manifest represent a unique opportunity to revisit the matrix 

and identify potential efficiencies because the current launch manifest 

contains more second-, and third-flight missions, or re-flights, than it has 

in decades. The “re-flight era,” as some officials called it, presented Air 

Force officials with an opportunity to revisit the activities typically 

undertaken prior to a first-flight launch, and effect the suspension of 

redundancies. 

Independent launch verification is only a small percentage of overall 

launch vehicle mission assurance activities, however, and most mission 

assurance activities remain undefined and unquantified. DOD officials are 

working to develop standards for potential new launch providers, but 

actions are still needed to address defining mission assurance 

requirements. As we previously reported, defining mission assurance 

requirements for national security space launches is important as new 

entrants emerge who will have to meet and account for defined mission 

assurance requirements to compete with ULA for EELV-class launches. 

 

14In July 2011, the EELV program awarded a Launch Capability contract as a cost-plus 

incentive fee contract. Air Force officials stated the contract includes a mission 

performance incentive plan and that the change in contract type is intended to incentivize 

ULA to deliver mission success at a lower cost. 

15The Launch Verification Matrix is a tool used for tracking closure of mission assurance 

activities, reviews and analyses related to mission assurance. 
 

Page 17 GAO-12-822 Evolved Expendable Launch Vehicle 

When we last reported on EELV, the Secretary of the Air Force, Director 

of the NRO, and the Administrator of NASA had signed an agreement 

formalizing their commitment to more closely coordinate launch vehicle 

acquisitions, but implementation details were largely undecided and the 

certification guide had yet to be finalized. Additionally, fragmented launch 

acquisitions contributed to pass-through fees levied on government 

launch agencies. For example, according to a 2010 Air Force study, ULA 

charges up to an 18 percent profit on top of engine prices and to act as a 

broker for the program office on commodities like propellants bought from 

other government agencies, like NASA and the Defense Logistics 

Agency. These are the costs the program could avoid if it were to 

coordinate purchases directly from other agencies. 

Some action taken; more action needed. Since our report, significant 

formal and ad hoc coordination has taken place across the DOD, NASA, 

and NRO, in areas such as new entrant certification and launch 

technology development, but officials at DOD and NASA indicate actions 

to implement broader efficiencies in launch acquisitions are not yet 

planned. 

DOD finalized its certification guide for new launch providers in October 

2011 following much collaboration with NASA and NRO. In addition to 

coordinating the final certification guide, officials at DOD, NASA and NRO 

meet regularly to discuss launch issues, such as vehicle design, 

technology development and the space industrial base. The Commander, 

Air Force Space Command, and the NASA Administrator also hold 

quarterly summit meetings, and DOD and NASA program-level launch 

officials at each agency hold monthly and ad hoc meetings to discuss 

upcoming launches and to share lessons learned. 

In December 2011, NASA, announced establishment of four expert teams 

as part of the National Institute for Rocket Propulsion Systems. These 

teams are comprised of specialists whose purpose is to tackle a series of 

challenges facing the rocket propulsion industrial base, which is at risk to 

industry downsizing and a shortage of new propulsion programs. The 

teams, consisting of propulsion experts representing government, 

industry, and academia lead by NASA’s Marshall Space Flight Center, 

have been created to develop action plans addressing challenges 

identified including fostering access to facilities and expertise and 

developing and implementing an integrated science and technology plan 

for propulsions systems, among others. 

Recommendation 6: 

Examine How Broader 

Launch Issues, Such as 

Greater Coordination 

across Federal Agencies, 

Can Increase Efficiencies 

and Cost Savings. 
 

Page 18 GAO-12-822 Evolved Expendable Launch Vehicle 

DOD and NASA also continue to work together on launch technology 

development efforts, including several new and ongoing efforts to 

upgrade existing engines and develop alternate engines. DOD and NASA 

are collaborating for example, on upperstage engine technology research 

and hydrocarbon booster engine projects jointly managed and executed 

by the Air Force Research Laboratory and NASA as part of the Integrated 

High-Payoff Rocket Propulsion Technology program.16 Additionally, both 

agencies contribute to NASA’s Ground Systems Development and 

Operations program, a modernization effort to develop NASA ground 

systems and refurbish infrastructure for the next generation of rockets. 

The collaboration among the three agencies on the new entrant 

certification guide represents a step toward establishing greater 

coordination in governmentwide launch acquisitions, but, according to 

officials, DOD and NASA plan to continue to acquire launch vehicles on 

separate contracts. We have previously reported that space launch 

acquisition processes for NASA and DOD are not formally coordinated, 

duplicate one another, and may not fully leverage the government’s 

investment because the government is not acting as a single buyer.17 And 

though communication takes place among the agencies, officials at DOD 

and NASA indicate little action has been taken to address broader launch 

issues governmentwide to leverage government buying power or 

coordinate launch and range acquisitions. 

We previously reported that national space policy and varied launch 

studies point to a lack of investment in the future of the U.S. launch 

industry, and we noted that the future of U.S. launch depends in part on 

next-generation technology, and decision makers could benefit from early 

insight into the path forward for launch. 

No action taken. Since our report, no launch technology plan has been 

developed. DOD investment in future launch technologies remains 

minimal, and DOD officials indicate developing a science and technology 

 

16The Integrated High Payoff Rocket Propulsion Technology Program is a structured 

government and industry program to improve U.S. rocket propulsion systems. 

17GAO, 2012 Annual Report: Opportunities to Reduce Duplication, Overlap and 

Fragmentation, Achieve Savings, and Enhance Revenue, GAO-12-342SP (Washington, 

D.C.: Feb. 28, 2012). 

Recommendation 7: 

Develop a Science and 

Technology Plan for 

Improving and Evolving 

Launch Technologies 
 

Page 19 GAO-12-822 Evolved Expendable Launch Vehicle 

plan is not a high priority. DOD officials noted that in the current budget 

climate, increased investment in launch technology research and 

development is unlikely. In some cases, technology efforts have been 

underway for 5 years or more, but receive minimal funding. Less than $8 

million of the roughly $1.7 billion in the EELV budget for fiscal year 2013 

is dedicated to launch technology research and development, with no 

funding budgeted after 2014. However, national policy and EELV and 

industrial base sustainment plans highlight the need for significant 

technology development and predict dire consequences if the current lack 

of development is sustained. 

In June 2011, the EELV program provided a sustainment plan to the 

Congress which identified required technology and investments to 

maintain the program’s current capability.18 The investments identified in 

the plan include $80 million for the RL10C engine conversion activities, 

$500 million in non-recurring costs over 5 years to develop a new or 

evolved upper stage engine, and $100 million each year to sustain and 

replace avionics, ordnance, ground command, control, and 

communications, and launch infrastructure. The plan states that due to 

the limited demand for some types of materials and components for 

propulsion, avionics, and ordnance systems, which can include complex 

materials, electronics, and computers, special emphasis must be placed 

on designing and qualifying new designs to mitigate obsolescence issues. 

Many of the parts across the systems either have designs that have 

become obsolete or are no longer produced. For example, to sustain 

some EELV mission-critical components, the Air Force is drafting a time 

phased plan to (1) identify obsolescence issues, (2) consolidate suppliers 

and components to improve the health of the supplier base by ordering 

larger quantities of one version versus smaller quantities of multiple 

versions, and (3) identify opportunities to insert new technology and 

design common systems, thereby increasing system reliability and 

interoperability. 

National policies, such as the National Security Presidential Directive-40, 

place a requirement on the government to sustain the EELV program and 

preserve its systems that provide access to space for the foreseeable 

 

18The House of Representatives Committee on Appropriations directed the Secretary of 

the Air Force, in consultation with the Director of the National Reconnaissance Office, to 

submit an EELV sustainment plan to the congressional defense committees by January 4, 

2010. H. R. Rep. No. 111-230, at 277 (2009). 
 

Page 20 GAO-12-822 Evolved Expendable Launch Vehicle 

future, and the 2010 National Space Policy recognizes a need to continue 

technology development directing the Secretary of Defense, with NASA, 

to sustain technology development for the next generation of launch.19

The December 2011 liquid rocket engine report indicates the current lack 

of design opportunities creates a challenge for industry to sustain a skilled 

workforce for future liquid rocket engine development programs, adding 

that a loss of critical skills and resources to continue development would 

be detrimental to mission success. 

DOD is taking steps to address deficiencies we identified in our 

September 2011 report and obtain the knowledge it needs to negotiate 

and award contracts supporting its new EELV acquisition strategy. We 

are encouraged by the wide range of actions taken and underway, 

although the quality of data to be yielded through these various activities 

is to be determined. Much of the value of the information obtained will 

depend on its quality and the extent to which DOD makes use of the 

information it obtains. That being said, the information likely to be 

available, coupled with actions such as not waiving access to cost or 

pricing data and providing more deliberative time via a bridge contract, 

should put DOD in a much better position to decide how to proceed with 

EELV than when we last reported. Near-term, it is imperative that DOD 

follow through with its plan to award a bridge contract for fiscal year 2013 

and allow its contracting officials enough time to incorporate the 

information it is gaining prior to awarding EELV block buy contracts, and 

that DOD remain flexible in awarding the block buy contract until it has all 

the knowledge it needs. Additionally, some information DOD is gaining 

could set the stage for longer-term strategic planning for the program, 

especially in critical launch technology research and development 

decisions. Investing in a longer-term perspective for launch acquisitions is 

important to fully leverage the government’s buying power and maintain a 

healthy industrial base. 

 

19National Space Policy of the United States of America, Intersector Guidelines Section, 

Pages. 5. 7, & 11 (June 28, 2010). 

Conclusions 
 

Page 21 GAO-12-822 Evolved Expendable Launch Vehicle 

DOD reviewed a draft of this report and concurred, with technical 

comments, which we incorporated in the final report as appropriate. See 

appendix II for DOD’s comments. 

We are sending copies of this report to appropriate congressional 

committees, the Secretary of Defense, and other interested parties. In 

addition, the report will be available at no charge on our website at 

http://www.gao.gov. 

If you have any questions about this report, please contact me 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 letter. Key contributors to this report are found in appendix III. 

Cristina T. Chaplain 

Director 

Acquisition and Sourcing Management 

Agency Comments 
 

Page 22 GAO-12-822 Evolved Expendable Launch Vehicle 

List of Committees

The Honorable Carl Levin 

Chairman 

The Honorable John McCain 

Ranking Member 

Committee on Armed Services 

United States Senate 

The Honorable Dianne Feinstein 

Chairman 

The Honorable Saxby Chambliss 

Ranking Member 

Select Committee on Intelligence 

United States Senate 

The Honorable Daniel Inouye 

Chairman 

The Honorable Thad Cochran 

Ranking Member 

Subcommittee on Defense 

Committee on Appropriations 

United States Senate 

The Honorable Howard P. “Buck” McKeon 

Chairman 

The Honorable Adam Smith 

Ranking Member 

Committee on Armed Services 

House of Representatives 

The Honorable Mike Rogers 

Chairman 

The Honorable C.A. “Dutch” Ruppersberger, III 

Ranking Member 

Permanent Select Committee on Intelligence 

House of Representatives 
 

Page 23 GAO-12-822 Evolved Expendable Launch Vehicle 

The Honorable C.W. Bill Young 

Chairman 

The Honorable Norman Dicks 

Ranking Member 

Subcommittee on Defense 

Committee on Appropriations 

House of Representatives 
Appendix I: Scope and Methodology 

Page 24 GAO-12-822 Evolved Expendable Launch Vehicle 

To assess the information contained in the Department of Defense (DOD) 

report to the Congress mandated by the fiscal year 2012 National 

Defense Authorization Act (NDAA), we reviewed DOD’s report and the 

supporting information contained therein, the Evolved Expendable 

Launch Vehicle (EELV) Acquisition Strategy, National Aeronautics and 

Space Administration (NASA) reports on its Space Launch System 

heavy-lift launch vehicle program, and DOD documentation of efforts 

underway to obtain sufficient information to negotiate EELV contracts; we 

assessed recent defense industrial base studies, DOD reports on United 

Launch Alliance (ULA) business systems from the Defense Contract Audit 

Agency (DCAA) and Defense Contract Management Agency (DCMA), 

and the EELV Sustainment Plan. We also examined EELV program 

budget and performance documents, independent cost assessments for 

two EELV engines, and compared historical and current launch 

manifests. We interviewed DOD officials responsible for auditing ULA’s 

business systems, and summarized the results or status of six subsystem 

audits. We interviewed or obtained perspectives from launch officials in 

various military and civilian government agencies and ULA. Through our 

review of DOD efforts, industrial base studies, and other relevant 

government and industry reports, our interviews with DOD, NASA, and 

contractor officials, and our review of an NRO report, we assessed the 

extent to which DOD has taken action to implement each of our seven 

recommendations made in GAO-11-641. Officials from DOD reviewed a 

draft of this report and provided technical comments, which we 

incorporated in the final report as appropriate. We did not evaluate 

progress made toward implementing prior GAO recommendations, for 

example from our 2008 report, as this was not part of the fiscal year 2012 

National Defense Authorization Act mandate. 

In summarizing the status of each recommendation, we assigned one of 

the following four status assessments to each of the recommendations. 

1. Complete. The recommended action item has been accomplished. 

2. Action underway; expected to complete. Steps have been taken to 

complete the recommended action item, and the item is expected to 

be completed in the near term. 

3. Some action taken; more action needed. Steps have been taken to 

complete the recommended action item, but more action is needed. 

Appendix I: Scope and Methodology 
Appendix I: Scope and Methodology 

Page 25 GAO-12-822 Evolved Expendable Launch Vehicle 

4. No action taken. No action has been taken to address the 

recommended action item, and the item is not expected to be 

completed. 

We interviewed officials in Washington, D.C. at the Office of the Secretary 

of Defense, Cost Assessment and Program Evaluation; and the Offices of 

the Under Secretary of Defense for Acquisition, Technology and 

Logistics, Defense Procurement and Acquisition Policy Directorate; Office 

of the Under Secretary of Defense for Acquisition for Manufacturing and 

Industrial Base Policy; and the National Aeronautics and Space 

Administration; in addition, we interviewed the Program Executive Officer 

(PEO) for Space Launch, Launch and Range Systems Directorate 

Commander; various EELV contracting officials; as well as officials at the 

Office of the Assistant Secretary of the Air Force for Acquisitions to 

discuss ongoing initiatives with respect to the space industrial base. We 

talked to the United Launch Alliance regarding its business systems, the 

EELV acquisition strategy, and mission assurance. We reviewed relevant 

reports from and interviewed officials directly involved in overseeing the 

program in DCAA, Littleton, Colorado, and in DCMA, Englewood, 

Colorado. 
Appendix II: Comments from the Department 

of Defense 

Page 26 GAO-12-822 Evolved Expendable Launch Vehicle 

Appendix II: Comments from the Department 

of Defense 
Appendix III: GAO Contact and Staff 

Acknowledgments 

Page 27 GAO-12-822 Evolved Expendable Launch Vehicle 

Cristina T. Chaplain, (202) 512-4841 or chaplainc@gao.gov

Key contributors to this report were Art Gallegos, Assistant Director; 

Claire Buck; Desirée Cunningham; John Krump, and Bob Swierczek. 

Appendix III: GAO Contact and Staff 

Acknowledgments 

Contact 

Acknowledgments 

(121051)
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