United States General Accounting Office

GAO Report to Congressional Committees

February 1997 NATIONAL MISSILE

DEFENSE

Risk and Funding

Implications for the

Space-Based Infrared

Low Component

GAO/NSIAD-97-16

GAO United States

General Accounting Office

Washington, D.C. 20548

National Security and

International Affairs Division

B-272654 

February 25, 1997

Congressional Committees

In 1995, the Department of Defense (DOD) made plans for the space and

missile tracking system—the low satellite component of the Space-Based

Infrared System (SBIRS)—to be deployed in fiscal year 2006. In

February 1996, the Congress directed the Secretary of Defense to

restructure the SBIRS program and deploy the first space and missile

tracking system (hereafter referred to as SBIRS-low) satellite in fiscal 

year 2002.1

 The Congress also appropriated $264 million above DOD’s fiscal

year 1996 and 1997 budget requests to support this deployment

acceleration. The purpose was to ensure that the space and missile

tracking system provided support to national and theater ballistic missile

defenses sooner, rather than later.

DOD has not implemented this congressional directive to accelerate

SBIRS-low deployment to fiscal year 2002. It stated that such acceleration

was not possible because technical, funding, and management problems

had delayed the scheduled launch of two demonstration satellites, the

results of which were necessary before deciding to initiate the fabrication

of operational SBIRS-low satellites. However, DOD is planning on

accelerating deployment to fiscal year 2004 and has directed the Air Force

to prepare cost estimates and program plans to support such deployment.

DOD originally estimated SBIRS-low life-cycle costs at $9.3 billion, which was

part of a total estimated life-cycle cost of $22.6 billion for the SBIRS

program during fiscal years 1995 through 2020. In October 1996, however,

the Air Force revised SBIRS program costs and informed us that these

estimates had decreased to $7.8 billion and $17.5 billion for fiscal years

1997 through 2020, respectively. Of the approximate $5-billion total

decrease, the Air Force attributed (1) $2.5 billion to using a lower inflation

index and to excluding fiscal year 1995 and 1996 program costs and

(2) $2.5 billion to plans for using fewer SBIRS-low satellites and different

launch vehicles and to acquisition reform and commercial practices. In

commenting on our draft report, DOD stated that as of December 1996,

SBIRS-low program costs had decreased an additional $800 million, from

$7.8 billion to $7 billion for fiscal years 1997 through 2020. However, DOD

did not provide a reason for this reduction.

1

See the National Defense Authorization Act for Fiscal Year 1996 (P.L. 104-106, Feb. 10, 1996).

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We reviewed the SBIRS-low program to determine the effects of changing

the deployment date from fiscal year 2006 (the original schedule) to fiscal

year 2002, 2003, 2004, or 2005. To do this, we relied on available Air Force

data—some of which was in draft form and none of which, according to

DOD, was verified by the Office of the Secretary of Defense. We performed

this review under our basic legislative responsibilities and are addressing

this report to you because the matters discussed fall within your

Committees’ jurisdiction.

Results in Brief Our assessment of four deployment options—fiscal years 2002, 2003, 2004,

and 2005—that would accelerate the SBIRS-low program from DOD’s

originally planned fiscal year 2006 schedule shows some potential

differences in risk and variations in funding requirements (see table 1).

Our assessment was based on data prepared by the Air Force at various

times between June 1995 and November 1996 using various assumptions.

Table 1: Program Risks and Funding

Variances in SBIRS-Low Deployment

Options Compared to the Original

Fiscal Year 2006 Schedule

Deployment options in

fiscal year

Program risk assessment

comparison

Estimated funding

variances

2002 Higher risk due to

concurrent program

activities

Additional $2.1 billion

during fiscal years 1997

through 2002

2003 Higher risk due to

concurrent program

activities

Additional $2.6 billion

during fiscal years 1997

through 2002

2004 Similar risk due to

sequential program

activities

Additional $509 million

during fiscal years 1998

through 2003

2005 Similar risk due to

sequential program

activities

Up to $500 million less

during fiscal years 1998

through 2003

The fiscal year 2002 and 2003 options would result in higher program risk

because of the high degree of concurrent activities between the planned

first year of the flight demonstration and the development and fabrication

of SBIRS-low satellites. In addition, although program officials stated that

total life-cycle costs would not be affected, a substantial amount of

additional funding would be required during fiscal years 1997 through 2002

because of compressing the SBIRS-low development, fabrication, and

deployment schedule. In commenting on our draft report, DOD stated that

the higher costs of the fiscal year 2003 option was due to differences in

technical configuration. DOD has not included these additional funding

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B-272654 

needs in its future years defense program; thus, the source of such funds

would need to be identified.2

If SBIRS-low deployment were scheduled for fiscal year 2004, the first year

of the flight demonstration and SBIRS-low engineering and manufacturing

development would be sequential, rather than concurrent, allowing time to

assess the demonstration results before making a milestone decision on

satellite development and fabrication. This schedule would make program

risk similar to the fiscal year 2006 schedule, which DOD considers to be

low. However, considerable additional funds during fiscal years 1998

through 2003 would be required because of program schedule

compression. Upon completing our field work, these additional funding

needs had not been included in DOD’s future years defense program.

However, in commenting on our draft report, DOD stated that recent

budgetary actions in December 1996 had identified and programmed the

additional funding in the fiscal year 1998 future years defense program.

Under the fiscal year 2005 option, flight demonstration and SBIRS-low

development and fabrication would also be sequential, rather than

concurrent. This schedule would also make program risk similar to the

fiscal year 2006 schedule. Funding requirements during fiscal years 1998

through 2003, however, would be less than those for DOD’s original

schedule for a fiscal year 2006 deployment. DOD and Air Force

representatives initially informed us that fewer funds would be required

because of planning for a more efficient production schedule. In

commenting on our draft report, however, DOD stated that fewer funds

were required because of a different satellite configuration and a lower

inflation rate.

The widely divergent results associated with these four deployment

options are directly linked to how soon SBIRS-low can and should be

scheduled to support national and theater ballistic missile defenses.

Although DOD is currently planning on a fiscal year 2004 SBIRS-low

deployment, the Congress has not rescinded the requirement in the

National Defense Authorization Act for Fiscal Year 1996 to accelerate

deployment to fiscal year 2002. How the Congress and DOD resolve these

differing views on deployment dates will determine how much program

risk may be taken and what the funding requirements would be.

2

Planned program execution is dependent on stable funding. Ensuring that sufficient resources are

included in DOD’s future years defense program is essential for program stability.

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B-272654 

We have reported on numerous occasions about the risks associated with

program concurrency and of initiating production without adequate

testing. The SBIRS-low fiscal year 2002 and 2003 options are analogous

situations whereby a planned decision to fabricate satellites would be

made before the results of a critical flight demonstration are available.

At this point in time, however, the Congress does not have complete and

consistent information on the program risks and the need for additional

funding associated with the various options to accelerate SBIRS-low

deployment. The Air Force’s data on these options were prepared at

different times using different assumptions, and the Air Force recently

established a new SBIRS program baseline using revised life-cycle costs.

Appendix I contains the details of our assessment.

Agency Comments

and Our Evaluation

In commenting on a draft of this report, DOD stated that the report

describes many of the issues and problems that have affected the program

in the past year and that as recently as December 1996, the Air Force and

DOD made some key decisions to focus development and stabilize funding.

DOD indicated that, to provide budgetary and technical discipline, the

program has been upgraded to a major defense acquisition program and a

Defense Acquisition Board review has been scheduled for the spring of

1997. DOD also noted that it had added funding to enhance the program

definition/risk reduction phase of the program and had established a fiscal

year 2004 deployment date to best balance technical risk and available

funding.

According to DOD, the Congress has accepted these actions as being in

conformance with its objectives and will be provided additional

information following the Defense Acquisition Board review. Given these

developments, DOD believes that the dialogue on various deployment

options has been successfully concluded and disagrees with our

recommendation that it provide additional information on the fiscal year

2002, 2003, 2004, and 2005 deployment options.

Despite DOD’s apparent plans to deploy SBIRS-low in fiscal year 2004, the

Congress has not changed the requirement in the National Defense

Authorization Act for Fiscal Year 1996 for deployment in fiscal year 2002.

In addition, DOD officials could not provide documentation supporting

their claim of “broad congressional support” for the fiscal year 2004

deployment. DOD stated that (1) it had struggled with identifying

Page 4 GAO/NSIAD-97-16 National Missile Defense
B-272654 

deployment costs and technical risk for a variety of different satellite

options and deployment dates, (2) the different technical assumptions and

costing methodologies used for the various deployment options had

caused confusion and uncertainty in the Congress, and (3) our report

accurately identified these problems. Also, DOD representatives have

informed us that the current SBIRS-low cost estimate, a portion of which is

included in the fiscal year 1998 future years defense program, could

change pending the results of an independent cost analysis.

In view of these facts, we reaffirm our recommendation that DOD fully

inform the Congress about the feasibility and effects of accelerating

SBIRS-low deployment for the fiscal year 2002, 2003, 2004, and 2005

deployment options.

DOD’s comments also provided suggestions to improve the technical

accuracy and clarity of the report and we have incorporated them in the

text where appropriate. DOD’s comments are reprinted in their entirety in

appendix II.

Recommendation To fully inform the Congress about the feasibility and effects of

accelerating SBIRS-low, we recommend that the Secretary of Defense

provide the congressional defense committees with complete, consistent,

and current information that discusses program risk, revised program

costs, and any additional funding needs and sources for the fiscal year

2002, 2003, 2004, and 2005 deployment options.

Matters for

Congressional

Consideration

The Congress may wish to consider the costs and risks of DOD’s plans to

deploy the first SBIRS-low satellite in fiscal year 2004, relative to the

statutory requirement in the National Defense Authorization Act for Fiscal

Year 1996 to deploy the first satellite in fiscal year 2002 and revise the

requirement as necessary.

If DOD does not provide the Congress with complete, consistent, and

current information on program risks, revised program costs, and any

additional funding needs and sources for the fiscal year 2002, 2003, 2004,

and 2005 deployment options for use in making its decision, the Congress

may wish to require that DOD provide it.

Page 5 GAO/NSIAD-97-16 National Missile Defense
B-272654 

Scope and

Methodology

The scope of our review involved the SBIRS-low component of the SBIRS

program and included an examination of program risks and changes in

funding requirements for various SBIRS-low deployment options. The

information for the options was developed by the Air Force at different

times between June 1995 and October 1996 for different purposes to

assess the feasibility of deploying SBIRS-low in fiscal years 2002, 2003, 2004,

and 2005. Because the Air Force did not use the same assumptions to

assess these options, a consistent comparison of changes in funding

requirements was not possible. For example, the options included

different satellite configurations and launch vehicles. According to DOD,

these different assessments led to disparities in cost and technical

estimates. Although we requested estimated funding requirements for each

option year that used the same assumptions, the SBIRS program director

stated that such a comparison was no longer meaningful because the Air

Force was preparing for a fiscal year 2004 deployment option decision.

Despite this lack of consistency, we believe that comparing this

information with the fiscal year 2006 deployment schedule provides some

indication of the funding and program risk differences.

We performed our work primarily at the Air Force Space and Missile

Systems Center and Aerospace Corporation in Los Angeles, California, and

the U.S. and Air Force Space Commands in Colorado Springs, Colorado.

We reviewed program requirements and briefings, acquisition and test

plans, budgetary information, management reports, and internal

memoranda.

In addition, we held discussions with representatives and obtained

documentation from the Office of the Deputy Under Secretary of Defense

for Space, the Air Force’s Office of the Assistant Secretary for Acquisition,

and the Ballistic Missile Defense Organization in Washington, D.C., and the

Air Force’s Phillips Laboratory in Albuquerque, New Mexico. We also held

discussions with and obtained documents from representatives of the

TRW Space and Electronics Group and Hughes Aircraft Company, which

is the contracting team that is developing and fabricating two flight

demonstration satellites.

We performed our work from October 1995 through September 1996 in

accordance with generally accepted government auditing standards.

Page 6 GAO/NSIAD-97-16 National Missile Defense
B-272654 

We are sending copies of this report to the Secretaries of Defense, the Air

Force, the Army, and the Navy; the Director of the Ballistic Missile

Defense Organization; and the Director of the Office of Management and

Budget. We will make copies available to others upon request.

This report was prepared under the direction of Thomas J. Brew,

Associate Director, Defense Acquisitions Issues, who may be reached on

(202) 512-4841 if you or your staff have any questions concerning

information in this report. Major contributors to this report are listed in

appendix III.

Louis J. Rodrigues

Director, Defense Acquisitions Issues

Page 7 GAO/NSIAD-97-16 National Missile Defense
B-272654 

List of Congressional Committees

The Honorable Strom Thurmond

Chairman

The Honorable Carl Levin 

Ranking Minority Member

Committee on Armed Services

United States Senate

The Honorable Ted Stevens

Chairman

The Honorable Daniel Inouye

Ranking Minority Member

Subcommittee on Defense

Committee on Appropriations

United States Senate

The Honorable Floyd D. Spence 

Chairman

The Honorable Ronald V. Dellums

Ranking Minority Member

Committee on National Security

House of Representatives

The Honorable C.W. Bill Young

Chairman

The Honorable John P. Murtha

Ranking Minority Member

Subcommittee on National Security

Committee on Appropriations

House of Representatives

Page 8 GAO/NSIAD-97-16 National Missile Defense
Page 9 GAO/NSIAD-97-16 National Missile Defense
Contents

Letter 1

Appendix I 

Program Plans,

Congressional

Direction, and

Deployment Options

12

Current DSP Replacement Plans 12

Congressional Emphasis on Early SBIRS-Low Deployment 13

Flight Demonstration Satellites Are Critical to SBIRS-Low 14

Assessment of SBIRS-Low Deployment Options 16

Appendix II 

Comments From the

Department of

Defense

24

Appendix III 

Major Contributors to

This Report

31

Table Table 1: Program Risks and Funding Variances in SBIRS-Low

Deployment Options Compared to the Original Fiscal Year 2006

Schedule

2

Figures Figure I.1: Fiscal Year 2002 and 2003 Deployment Options

Compared to Fiscal Year 2006 Original Schedule

18

Figure I.2: Fiscal Year 2004 Deployment Option Compared to

Fiscal Year 2006 Original Schedule

20

Figure I.3: Fiscal Year 2005 Deployment Option Compared to

Fiscal Year 2006 Original Schedule

22

Abbreviations

DOD Department of Defense

DSP Defense Support Program

EMD engineering and manufacturing development

SBIRS Space-Based Infrared System

Page 10 GAO/NSIAD-97-16 National Missile Defense
Page 11 GAO/NSIAD-97-16 National Missile Defense
Appendix I 

Program Plans, Congressional Direction,

and Deployment Options

The Department of Defense’s (DOD) Defense Support Program (DSP)—a

strategic surveillance and early warning satellite system with an infrared

capability to detect long-range ballistic missile launches—has been

operational for about 25 years. Since the early 1980s, DOD’s efforts to

replace DSP with more modern capability have been unsuccessful because

of immature technology, high cost, and affordability issues. These aborted

efforts have included the Advanced Warning System; the Boost

Surveillance and Tracking System; the Follow-on Early Warning System;

and the Alert, Locate, and Report Missiles system.

DSP’s capabilities in theater situations became increasingly important

during the 1991 Persian Gulf War with the launching of SCUD missiles by

Iraq. However, more timely and accurate information was needed on these

short-range ballistic missile launches. The Air Force subsequently made

changes in DSP data processing to achieve an enhanced capability—a

system known as Attack and Launch Early Reporting to Theater—without

modifying the DSP satellite sensors. However, DOD concluded that

expanding theater warning requirements necessitated new sensor

technology, and it began planning for an improved infrared satellite sensor

capability that would support both strategic and theater operations.

Current DSP

Replacement Plans

In 1994, DOD initiated a study1 to consolidate various infrared space

requirements. Based on the study results, it selected the Space-Based

Infrared System (SBIRS) to replace DSP. SBIRS is expected to use more

sophisticated infrared technologies, which are intended to enhance the

detection and tracking of strategic and theater ballistic missile launches

and provide critical data for national and theater missile defense systems,

than DSP.

The SBIRS architecture consists of space and ground processing segments.

The space segment contains both high and low orbit components. The

high component is to consist of four satellites operating in

geosynchronous earth orbit and sensors on two host satellites operating in

a highly elliptical orbit.2

 In commenting on our draft report, DOD officials

stated that for planning purposes the SBIRS-low component consists of 24

operational satellites in low earth orbit. However, the SBIRS-low

1

Referred to as the Office of the Secretary of Defense Space-Based Warning Summer Study.

2

A satellite in a geosynchronous orbit has a circular period of revolution that is equal to the period of

the earth’s rotation about its axis, or 24 hours. A satellite in a highly elliptical orbit spends most of its

time over a designated area of the earth, known as apogee dwell.

Page 12 GAO/NSIAD-97-16 National Missile Defense
Appendix I 

Program Plans, Congressional Direction,

and Deployment Options

constellation could consist of more or less satellites depending on the

results of contractor cost and performance studies.

The ground processing segment is to consist of a mission control station in

the United States, a communication system, and two overseas ground

stations. The Air Force plans to develop the ground segment in three

increments. Increment I is to consolidate the existing DSP ground

processing operations. During increment II, the Air Force plans to

integrate the high component satellites’ data processing with the

consolidated DSP operations. Increment III is to incorporate the functions

and equipment necessary to support SBIRS-low when it is deployed.

DOD decided to deploy the high orbit component beginning in fiscal

year 2002 because of (1) an urgent need to replace DSP, primarily for

theater missile defense purposes; (2) the low program risk associated with

technology, infrastructure, and schedule; and (3) the system’s ability to

meet key performance parameters. DOD determined that SBIRS-low could be

deployed in fiscal year 2006 and planned to make a deployment decision in

fiscal year 2000 after key technologies and operating concepts were

validated on two demonstration satellites scheduled for launch in fiscal

year 1999. DOD’s rationale for deploying SBIRS-low at a later date was

because (1) the national missile defense mission for SBIRS, which only this

component could satisfy, was not a key requirement and (2) the risk

associated with antiballistic missile treaty issues, technology, cost,

schedule, and operational complexity was high.

Congressional

Emphasis on Early

SBIRS-Low

Deployment

The National Defense Authorization Act for Fiscal Year 1996 required the

Secretary of Defense to accelerate the space and missile tacking system

(now called SBIRS-low) deployment of the first satellite to fiscal year 2002.

The purpose was to ensure that SBIRS-low provided support to national and

theater ballistic missile defenses sooner, rather than later. To help achieve

this objective, the Congress appropriated an additional $135 million above

DOD’s fiscal year 1996 budget request.

During deliberations on DOD’s fiscal year 1997 budget request, the

Congress reiterated its desire that SBIRS-low deployment be accelerated,

and it appropriated $129 million above DOD’s budget request to do so. The

Congress also expressed disappointment with DOD for not (1) responding

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Appendix I 

Program Plans, Congressional Direction,

and Deployment Options

in a timely manner to the fiscal year 1996 statutory requirement and

(2) obligating all of the fiscal year 1996 SBIRS-low funds as directed.3

In responding to the congressional direction, the Under Secretary of

Defense for Acquisition and Technology wrote, in a July 24, 1996, letter to

congressional committees, that accelerated deployment of SBIRS-low

beginning in fiscal year 2002 was not possible because technical, funding,

and management problems had delayed the scheduled launch of the two

demonstration satellites from the first quarter to the third quarter of fiscal

year 1999. According to Air Force officials, this delay prevented basing a

milestone decision to enter the engineering and manufacturing

development (EMD) phase of the SBIRS-low acquisition process, scheduled

for the first quarter of fiscal year 2000, on the results of the planned flight

demonstration.

Earlier, in a July 10, 1996, letter, the Under Secretary requested that the

Defense Science Board assess the viability of accelerating SBIRS-low

deployment. In September 1996, based on the Board’s findings and

recommendations, the Under Secretary directed the Air Force to

(1) prepare for a SBIRS-low deployment decision no later than April 15,

1997, and (2) develop an acquisition strategy, an acquisition program

baseline, an independent cost assessment, and a preliminary test plan that

would support SBIRS-low deployment in fiscal year 2004. The purpose of

the planned April decision was to choose between the fiscal year 2004

option and the fiscal year 2006 original schedule. Also, in September 1996,

the Under Secretary appeared before a congressional panel, testifying on

ballistic missile defense, and stated that DOD was considering the

affordability of accelerating SBIRS-low deployment to fiscal year 2004.4

 In

commenting on our draft report, DOD stated that a fiscal year 2004

deployment decision was made in December 1996. However, the

Acquisition Decision Memorandum documenting this decision will not be

finalized until the spring of 1997.

Flight Demonstration

Satellites Are Critical

to SBIRS-Low

The flight demonstration program includes three satellites—one low

altitude demonstration system satellite for competitive development

purposes and two satellites for flight demonstration purposes. The low

altitude demonstration system satellite is to (1) provide an alternative to

3

DOD subsequently released all of these funds to the Air Force, which has until September 30, 1997, to

obligate them.

4

Testimony before a joint session of the Subcommittee on Military Research and Development and the

Subcommittee on Military Procurement of the House Committee on National Security, Sept. 27, 1996.

Page 14 GAO/NSIAD-97-16 National Missile Defense
Appendix I 

Program Plans, Congressional Direction,

and Deployment Options

the contractor team that is now fabricating the two flight demonstration

satellites and (2) reduce program and technical risks.

The two flight demonstration satellites are to validate the integration of

key technologies and operational concepts that are critical to national

missile defense and other SBIRS missions. The Air Force draft test plan calls

for launching a single ballistic missile target to demonstrate the ability of

these satellites to perform this national missile defense function. Also, the

Air Force intends to participate in Ballistic Missile Defense Organization

tests designed to further demonstrate the ability of the two satellites to

detect and track ballistic missiles. It plans to use the results of the

demonstration and tests to model and simulate the full performance

capability of a constellation of operational SBIRS-low satellites.

In commenting on our draft report, DOD stated that it has approved

additional theater and national missile defense targets for the flight

demonstration program. In doing so, it programmed $149 million for one

theater and one national missile defense target for the low altitude

demonstration system and one theater missile defense target for the flight

demonstration satellites. According to DOD officials, these additional

missile tests were added to give needed statistical validity to the test

results.

The results of the planned flight demonstration, prior to the Board’s

recommendations, were intended to form the basis for decision-making

regarding SBIRS-low development, fabrication, and deployment—that is

entry into the EMD phase of the acquisition process. The primary emphasis

is on the ability to detect and track ballistic missiles and their warheads

throughout flight and distinguish between missile warheads and decoys.

According to program officials, performing this function autonomously

while in orbit is one of the most complex and technologically challenging

operational concepts ever attempted. They believe that a national missile

defense system with space-based sensors depends on a successful flight

demonstration program. They stated that proceeding into the EMD phase

prior to demonstrating this capability would not provide an opportunity to

assess lessons learned, thus introducing unacceptable risk into the

program.

In commenting on our draft report, DOD emphasized that the flight

demonstration program was extended from 1 year to 2 years. It stated that

the extension was needed to participate in scheduled Ballistic Missile

Defense Organization tests, as well as to fully use the satellites during their

Page 15 GAO/NSIAD-97-16 National Missile Defense
Appendix I 

Program Plans, Congressional Direction,

and Deployment Options

2- to 3-year life expectancy. However, DOD officials stated that information

collected during the first year of the test program is the most critical for

making a decision of whether to enter EMD.

We have reported on numerous occasions about the risks associated with

program concurrency and of initiating production without adequate

testing. SBIRS-low could be an analogous situation. For example, in 1990,

we concluded that although concurrency can be used to expedite the

development and production of weapon systems, rushing into production

(in this case, satellite fabrication) before critical tests (in this case, flight

demonstration) are successfully completed has resulted in the purchases

of systems that do not perform as intended. And, in 1994, we reported that

programs are often permitted to begin production with little or no

scrutiny, and the consequences have included procurement of substantial

inventories of unsatisfactory weapons requiring costly modifications to

achieve satisfactory performance, and in some cases, deployment of

substandard systems to combat forces.5

Assessment of

SBIRS-Low

Deployment Options

In response to congressional direction to accelerate SBIRS-low deployment

to fiscal year 2002, the Air Force assessed a range of potential deployment

options that included fiscal years 2002, 2003, 2004, and 2005. The

information for these option years was prepared at different times

between June 1995 and October 1996 and did not always contain the same

assumptions. Although a consistent comparison with the fiscal year 2006

original deployment schedule of changes in funding requirements for each

option was not made, the assessments provide some indication of the

differences in funding requirements.

Fiscal Year 2002 and 2003

Options Create Higher

Program Risk and

Substantial Additional

Funding Requirements

If SBIRS-low deployment were accelerated from the originally planned date

of fiscal year 2006 to fiscal year 2002 or 2003, DOD would face higher

program risks and substantial additional funding requirements in its future

years defense program. Both of these deployment options are similar

because the increased risk would result primarily from the scheduled

concurrent activities between the first year of the flight demonstration

program and the EMD phase.

Based on the currently planned launch of the two demonstration satellites

in the third quarter of fiscal year 1999, from 4 to 8 months of the scheduled

5

Weapon Systems: Concurrency in the Acquisition Process (GAO/T-NSIAD-90-43, May 17, 1990) and

Weapons Acquisition: Low-Rate Initial Production Used to Buy Weapon Systems Prematurely

(GAO/NSIAD-95-18, Nov. 21, 1994).

Page 16 GAO/NSIAD-97-16 National Missile Defense
Appendix I 

Program Plans, Congressional Direction,

and Deployment Options

first year of the flight demonstration program would overlap with the EMD

phase. Thus, a decision on whether the system should enter the EMD phase

could not be based on an analysis of demonstrated capabilities. As

discussed in the previous section, DOD officials stated that information

obtained during the first year of the flight test program is the most critical

in deciding whether to enter EMD. During EMD, the contractor is to finalize

SBIRS-low design, validate selected manufacturing and production

processes, and fabricate and deploy the satellites. The decision to enter

EMD is important because DOD will be committing several billion dollars to

buy up to 24 or more satellites. If flight demonstration reveals that design

changes are needed to achieve satisfactory performance, or if long lead

parts for the SBIRS-low operational satellites became obsolete because their

acquisition was based on an immature system design, program costs

would increase.

Some program risk could also be expected because the pre-EMD phase

would start from 9 to 12 months prior to launch of the flight demonstration

satellites. During the pre-EMD phase, SBIRS-low users, operators, testers,

and competing contractors are to refine and document system

requirements, functions, and design concepts. The contractors are to also

conduct cost and performance trade-offs between system requirements.

Under this schedule, it would not be possible for requirements

development and system design to be based on the results of the flight

demonstration. In addition, SBIRS program officials stated that such

concurrent scheduling would likely create difficulty in processing and

assimilating the large amounts of data that would be expected from the

flight demonstration and pre-EMD acquisition phases. Because of this

highly concurrent schedule, the Defense Science Board questioned the

value of the flight demonstration effort if the fiscal year 2002 deployment

option were chosen.6

 It stated that under the fiscal year 2002 option the

effort should be terminated, ground testing should be employed instead,

and the SBIRS-low program should be restructured to proceed directly into

pre-EMD in fiscal year 1997.

Figure I.1 shows the planned acquisition schedules for the flight

demonstration and the pre-EMD and EMD phases for the fiscal year 2002 and

2003 options, as compared to the fiscal year 2006 original schedule.

6

The Board did not include a fiscal year 2003 option in its report.

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Program Plans, Congressional Direction,

and Deployment Options

Figure I.1: Fiscal Year 2002 and 2003 Deployment Options Compared to Fiscal Year 2006 Original Schedule

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-- Pre-EMD

-- EMD

FY 2002

-- Pre-EMD

-- EMD

FY 2003

-- Pre-EMD

-- EMD

FY 2006

Fiscal year

1995 1998 1999 2000 2001 2002 2003 2004 2005 2006 

Source: Air Force briefing charts.

The fiscal year 2002 and 2003 deployment options contain substantial

increased funding requirements relative to the fiscal year 2006 original

schedule. The Air Force estimated that during fiscal years 1997 through

2002, these two options would require an additional $2.1 billion and

$2.6 billion, respectively. These estimates were prepared in April 1996 and

June 1995, respectively. The additional funding (1) would result from

Page 18 GAO/NSIAD-97-16 National Missile Defense
Appendix I 

Program Plans, Congressional Direction,

and Deployment Options

compressing the schedule for developing and fabricating SBIRS-low and

incurring associated costs sooner than originally planned and (2) would be

separate from any increased costs that could occur from the scheduled

concurrence, such as flight demonstration results forcing system design

changes or premature acquisition of long lead parts. In commenting on our

draft report, DOD stated that (1) the higher cost of the fiscal year 2003

option was due to differences in technical configuration and (2) both

funding estimates were probably low, considering the level of

development and production concurrency.

According to DOD officials, such funding has not been included in the

future years defense program and would therefore require increased

appropriations from the Congress or a reduction of funding for other DOD

or Air Force programs. The importance of sufficient resources in DOD’s

future years defense program is to ensure program stability. In fact, DOD

regulations require that no acquisition program be approved to proceed

beyond program initiation unless sufficient resources, including

manpower, are programmed in the most recently approved future years

defense program or will be programmed in the next program objective

memorandum, budget estimate submission, or President’s budget.

Risk Under Fiscal Year

2004 Option Is Similar but

Requires Considerable

Additional Funding

If SBIRS-low deployment were accelerated from the originally planned date

of fiscal year 2006 to fiscal year 2004, the risk of entering EMD would be

similar. However, DOD would need considerable additional funding in its

future years defense program.

Figure I.2 shows that under this option the first year of the flight

demonstration would be completed about 4 months before the start of

EMD. Thus, DOD would have information on the demonstration satellites’

performance to consider in deciding whether the system should enter the

EMD phase. However, the flight demonstration and pre-EMD phase would

run concurrently, not allowing demonstration results to influence

requirements development and system design.

In considering this option, the Board concluded that the flight experiments

(demonstration) could proceed in parallel with pre-EMD. However, the

Board did not provide a reason for this conclusion. It stated that although

the experiments were extremely beneficial, the associated on-orbit test

plans were inadequate to fully exploit the demonstration and additional

dedicated targets and test time should be added.

Page 19 GAO/NSIAD-97-16 National Missile Defense
Appendix I 

Program Plans, Congressional Direction,

and Deployment Options

Figure I.2: Fiscal Year 2004 Deployment Option Compared to Fiscal Year 2006 Original Schedule

Fiscal year

AAAA AAAA

AAAA

AAAA AAAA

AAAA

AAAA AAAA

AAAA

AAAA AAAA

AAAA

AAAA

AA

First launch

 -- Development

 -- Demonstration

Flight

Demonstration

-- Pre-EMD

-- EMD

FY 2004

-- Pre-EMD

-- EMD

FY 2006

AAAA AAAA AAAA AAAAAAAA AAAA AAAA AAAAAAAA AAAA AAAA AAAAAAAA AAAA AAAA AAAAAAAA AAAA AAAA AAAAAAAA AAAA AAAA AAAAAAAA AAAA AAAA AAAAAAAA AAAA AAAA AAAAAAAA AAAA AAAA AAAAAAAA AAAA AAAA AAAAAAAA AAAA AAAA AAAAAAA AAA

AAA

AAA

1995 1998 1999 2000 2001 2002 2003 2004 2005 2006 

Source: Air Force briefing charts.

Similar to the fiscal year 2002 and 2003 options, the fiscal year 2004 option

would require additional funding because program activities would be

compressed. Air Force representatives estimated in October 1996 that an

additional $900 million would be required during fiscal years 1998 through

2003 for this option. However, in commenting on our draft report, DOD

Page 20 GAO/NSIAD-97-16 National Missile Defense
Appendix I 

Program Plans, Congressional Direction,

and Deployment Options

stated that a more current budget estimate revised the additional funding

downward to $509 million. The reasons given were (1) using a different

launch vehicle, (2) using different inflation assumptions, (3) savings from

the SBIRS-high program, and (4) better cost estimating fidelity. It also stated

that the funding is included in the fiscal year 1998 future years defense

program.

Risk Under Fiscal Year

2005 Option Is Similar but

Requires Less Funding

If SBIRS-low deployment were accelerated from the originally planned date

of fiscal year 2006 to fiscal year 2005, program risk would be similar.

However, the funding requirements would be less.

Figure I.3 shows that under this option the first year of the flight

demonstration would be completed about 4 months prior to the start of

EMD. Thus, DOD would have information on the demonstration satellites’

performance to consider in deciding whether the system should enter the

EMD phase. Although there is some concurrency between pre-EMD and

flight demonstration under this option, such concurrency is also present in

the fiscal year 2006 original schedule.

Page 21 GAO/NSIAD-97-16 National Missile Defense
Appendix I 

Program Plans, Congressional Direction,

and Deployment Options

Figure I.3: Fiscal Year 2005 Deployment Option Compared to Fiscal Year 2006 Original Schedule

First launch

 -- Development

 -- Demonstration

Flight 

Demonstration

-- Pre-EMD

-- EMD

FY 2005

-- Pre-EMD

-- EMD

FY 2006

AAAA AAAA AAAAAAAA AAAA AAAAAAAA AAAA AAAAAAAA AAAA AAAAAAAA AAAA AAAAAAAA AAAA AAAAAAAA AAAA AAAAAAAA AAAA AAAAAAAA AAAA AAAAAAAA AAAA AAAAAAAA AAAA AAAAAAAA AAAA AAAAAAAA AAAA AAAAAAAA AAAA

AAAA

AAAA AAAA AAAA

AAAA

AAAA AAAA

AAA

AAA

AAA

Fiscal year

1995 1998 1999 2000 2001 2002 2003 2004 2005 2006 

Source: Air Force briefing charts.

Air Force officials stated that although there are no technical constraints

precluding a fiscal year 2005 deployment, they initially preferred the fiscal

year 2006 deployment schedule because it allowed for a slower buildup of

funding requirements. Budget estimates, which were prepared in

May 1996, supporting the fiscal year 2005 deployment option showed that

Page 22 GAO/NSIAD-97-16 National Missile Defense
Appendix I 

Program Plans, Congressional Direction,

and Deployment Options

up to $500-million less would be required for fiscal years 1998 through

2003 than for the original fiscal year 2006 schedule. In commenting on our

draft report, DOD officials stated that the reason for the $500-million

reduction, even though it represents acceleration from the fiscal year 2006

schedule, was due to a different satellite configuration and a lower

inflation rate. Thus, they stated that it was not an adequate comparison

with the fiscal year 2006 configuration.

Page 23 GAO/NSIAD-97-16 National Missile Defense
Appendix II 

Comments From the Department of Defense

Page 24 GAO/NSIAD-97-16 National Missile Defense
Appendix II 

Comments From the Department of Defense

Page 25 GAO/NSIAD-97-16 National Missile Defense
Appendix II 

Comments From the Department of Defense

Now on p. 5.

See pp. 4-5.

Page 26 GAO/NSIAD-97-16 National Missile Defense
Appendix II 

Comments From the Department of Defense

See title.

Now on p. 1.

Now on p. 1.

Now on p. 1.

Now on p. 1.

Now on p. 2.

Page 27 GAO/NSIAD-97-16 National Missile Defense
Appendix II 

Comments From the Department of Defense

Now on p. 2.

Now on p. 2.

Now on p. 3.

Now on p. 3.

Now on p. 3.

Now on p. 3.

Now on p. 4.

Page 28 GAO/NSIAD-97-16 National Missile Defense
Appendix II 

Comments From the Department of Defense

Now on p. 5.

Now on p. 6.

Now on p. 12.

Now on p. 12.

Now on p. 12.

Now on p. 13.

Now on p. 14.

Now on p. 14.

Page 29 GAO/NSIAD-97-16 National Missile Defense
Appendix II 

Comments From the Department of Defense

Now on p. 15.

Now on p. 15.

Now on p. 15.

Now on p. 17.

Now on p. 17.

Now on p. 19.

Now on pp. 20-21.

Now on p. 21.

Now on pp. 22-23.

Page 30 GAO/NSIAD-97-16 National Missile Defense
Appendix III 

Major Contributors to This Report

National Security and

International Affairs

Division, Washington,

D.C.

Homer H. Thomson

James A. Elgas

Steve Martinez

Denver Office Arthur Gallegos

Maricela Camarena

(707130) Page 31 GAO/NSIAD-97-16 National Missile Defense
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