Polar-Orbiting Satellites: With Costs Increasing and Data Continuity at Risk, Improvements Needed in Tri-agency Decision Making
Published: 2009-06-17T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: The National Polar-orbiting Operational Environmental Satellite System (NPOESS)--a tri-agency acquisition managed by the Department of Commerce's National Oceanic and Atmospheric Administration (NOAA), the Department of Defense (DOD), and the National Aeronautics and Space Administration (NASA)--is considered critical to the United States' ability to maintain the continuity of data required for weather forecasting (including severe weather events such as hurricanes) and global climate monitoring. Since its inception, NPOESS has experienced escalating costs, schedule delays, and technical difficulties. As the often-delayed launch of its demonstration satellite (called the NPOESS Preparatory Project--NPP) draws closer, these problems continue. GAO was asked to summarize its report being released today that (1) identifies the status and risks of key program components, (2) assesses the NPOESS Executive Committee's ability to fulfill its responsibilities, and (3) evaluates efforts to identify an alternative system integrator for later NPOESS satellites.
section_title: What GAO Found
paragraphs: The NPOESS program's approved cost and schedule baseline is not achievable and problems with two critical sensors continue to drive the program's cost and schedule. Costs are expected to grow by about $1 billion from the current $13.95 billion cost estimate, and the schedules for NPP and the first two NPOESS satellites are expected to be delayed by 7, 14, and 5 months, respectively. These delays endanger the continuity of weather and climate satellite data because there will not be a satellite available as a backup should a satellite fail on launch or in orbit--loss of a Defense Meteorological Satellite Program (DMSP) satellite, an NPOESS satellite, or NPP could result in a 3 to 5 year gap in data continuity. Program officials reported that they are assessing alternatives for mitigating risks, and that they plan to propose a new cost and schedule baseline by the end of June 2009. However, the Executive Committee does not have an estimate for when it will make critical decisions on cost, schedule, and risk mitigation. While the NPOESS Executive Committee has made improvements over the last several years in response to prior recommendations, it has not effectively fulfilled its responsibilities and does not have the membership and leadership it needs to effectively or efficiently oversee and direct the NPOESS program. Until its shortfalls are addressed, the Committee will be unable to effectively oversee the NPOESS program--and important issues involving cost growth, schedule delays, and satellite continuity will likely remain unresolved. The NPOESS program has conducted two successive studies of alternatives to using the existing system integrator for the last two NPOESS satellites, but neither identified a viable alternative to the current contractor. Program officials plan to conduct a final study prior to the June 2010 decision on whether to proceed with the existing prime contractor.

section_title: Letter
paragraphs: Thank you for the opportunity to participate in today’s hearing on the  National Polar-orbiting Operational Environmental Satellite System  (NPOESS). NPOESS is expected to be a state-of-the-art satellite system  that will replace two existing satellite systems. It is considered critical to  the United States’ ability to maintain the continuity of data required for  weather forecasting (including severe weather events such as hurricanes)  and global climate monitoring. Three agencies share responsibility for  NPOESS: the Department of Commerce’s National Oceanic and  Atmospheric Administration (NOAA), the Department of Defense  (DOD)/United States Air Force, and the National Aeronautics and Space  Administration (NASA). As requested, this statement summarizes our  report being released today that (1) identifies the status and risks of key  program components, (2) assesses the NPOESS Executive Committee’s  ability to fulfill its responsibilities, and (3) evaluates efforts to identify an  alternative system integrator for later NPOESS satellites.
In preparing this testimony, we relied on our work supporting the  accompanying report. That report contains a detailed overview of our  scope and methodology. All of our work for this report was performed 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.
subsections: section_title: Background
paragraphs: Polar-orbiting satellites provide data and imagery that are used by weather  forecasters, climatologists, and the military to map and monitor changes in  weather, climate, the oceans, and the environment. Since the 1960s, the  United States has operated two separate operational polar-orbiting  meteorological satellite systems: the Polar-orbiting Operational  Environmental Satellite (POES) series, which is managed by NOAA, and  the Defense Meteorological Satellite Program (DMSP), which is managed  by the Air Force. Currently, there is one operational POES satellite and  two operational DMSP satellites that are positioned so that they can  observe the earth in early morning, midmorning, and early afternoon polar  orbits. In addition, the government is also relying on a European satellite,  called Meteorological Operational, or MetOp, in the midmorning orbit.
With the expectation that combining the POES and DMSP programs would  reduce duplication and result in sizable cost savings, a May 1994  Presidential Decision Directive required NOAA and DOD to converge the  two satellite programs into a single satellite program capable of satisfying  both civilian and military requirements. The converged program,  NPOESS, is considered critical to the United States’ ability to maintain the  continuity of data required for weather forecasting and global climate  monitoring. To manage this program, DOD, NOAA, and NASA formed the  tri-agency Integrated Program Office, located within NOAA. Within the  program office, each agency has the lead on certain activities: NOAA has  overall program management responsibility for the converged system and  for satellite operations; the Air Force has the lead on the acquisition; and  NASA has primary responsibility for facilitating the development and  incorporation of new technologies into the converged system. NOAA and  DOD share the cost of funding NPOESS, while NASA funds specific  technology projects and studies. In addition, an Executive Committee— made up of the administrators of NOAA and NASA and the Under  Secretary of Defense for Acquisition, Technology, and Logistics—is  responsible for providing policy guidance, ensuring agency support and  funding, and exercising oversight authority. The Executive Committee  manages the program through a Program Executive Officer who oversees  the NPOESS program office.
Since the program’s inception, NPOESS costs have grown to $13.95 billion,  and launch schedules have been delayed by up to five years. In addition,  as a result of a 2006 restructuring of the program, the agencies reduced the  program’s functionality by removing 2 of 6 originally planned satellites and  one of the orbits. The restructuring also decreased the number of  instruments from 13 (10 sensors and 3 subsystems) to 9 (7 sensors and 2  subsystems), with 4 of the sensors providing fewer capabilities. The  restructuring also led agency executives to mitigate potential data gaps by  deciding to use a planned demonstration satellite, called the NPOESS  Preparatory Project (NPP) satellite, as an operational satellite providing  climate and weather data. However, even after this restructuring, the  program is still encountering technical issues, schedule delays, and the  likelihood of further cost increases.
section_title: Progress Made, but Continued Instrument Problems Are Driving Costs Upward, Forcing Launch Delays, and Endangering Satellite Continuity
paragraphs: Over the past year, selected components of the NPOESS program have  made progress. Specifically, three of the five instruments slated for NPP  have been delivered and integrated on the spacecraft; the ground-based  satellite data processing system has been installed and tested at both of  the locations that are to receive NPP data; and the satellites’ command,  control, and communications system has passed acceptance testing.  However, problems with two critical sensors continue to drive the  program’s cost and schedule. Specifically, challenges with a key sensor’s  (the Visible/infrared imager radiometer suite (VIIRS)) development,  design, and workmanship have led to additional cost overruns and delayed  the instrument’s delivery to NPP. In addition, problems discovered during  environmental testing on another key sensor (called the Cross-track  infrared sounder (CrIS)) led the contractor to further delay its delivery to  NPP and added further unanticipated costs to the program. To address  these issues, the program office halted or delayed activities on other  components (including the development of a sensor planned for the first  NPOESS satellite, called C1) and redirected those funds to fixing VIIRS  and CrIS. As a result, those other activities now face cost increases and  schedule delays.
Program officials acknowledge that NPOESS will cost more than the  $13.95 billion previously estimated, but they have not yet adopted a new  cost estimate. Program officials estimated that program costs will grow by  about $370 million due to recent technical issues experienced on the  sensors and the costs associated with halting and then restarting work on  other components of the program. In addition, the costs associated with  adding new information security requirements to the program could reach  $200 million. This estimate also does not include approximately $410  million for operations and support costs for the last two years of the  program’s life cycle (2025 and 2026). Thus, we anticipate that the overall  cost of the program could grow by about $1 billion from the current $13.95  billion estimate—especially given the fact that difficult integration and  testing of the sensors on the NPP and C1 spacecrafts has not yet  occurred. Program officials reported that they plan to revise the  program’s cost estimate over the next few weeks and to submit it for  executive-level approval by the end of June 2009.
As for the program’s schedule, program officials estimate that the delivery  of VIIRS to the NPP contractor will be delayed, resulting in a further delay  in the launch of the NPP satellite to January 2011, a year later than the  date estimated during the program restructuring—and seven months later  than the June 2010 date that was established last year. In addition,  program officials estimated that the first and second NPOESS satellites  would be delayed by 14 and 5 months, respectively, because selected  development activities were halted or slowed to address VIIRS and CrIS  problems. The program’s current plans are to launch C1 in March 2014 and  the second NPOESS satellite, called C2, in May 2016. Program officials  notified the Executive Committee and DOD’s acquisition authority of the  schedule delays, and under DOD acquisition rules, are required to submit a  new schedule baseline by June 2009.
These launch delays have endangered our nation’s ability to ensure the  continuity of polar-orbiting satellite data. The final POES satellite, called  NOAA-19, is in an afternoon orbit and is expected to have a 5-year lifespan.  Both NPP and C1 are planned to support the afternoon orbit. Should the  NOAA-19 satellite fail before NPP is launched, calibrated, and operational,  there would be a gap in satellite data in that orbit. Further, the delays in C1  mean that NPP will not be the research and risk reduction satellite it was  originally intended to be. Instead, it will have to function as an operational  satellite until C1 is in orbit and operational—and if C1 fails on launch or in  early operations, NPP will be needed to function until C3 is available,  currently planned for 2018. The delay in the C2 satellite launch affects the  early morning orbit. There are three more DMSP satellites to be launched  in the early and midmorning orbits, and DOD is revisiting the launch  schedules for these satellites to try to extend them as long as possible.  However, an independent review team, established to assess key program  risks, recently reported that the constellation of satellites is extremely  fragile and that a single launch failure of a DMSP, NPOESS, or the NPP  satellite could result in a gap in satellite coverage from 3 to 5 years.
Although the program’s approved cost and schedule baseline is not  achievable and the polar satellite constellation is at risk, the Executive  Committee has not yet made a decision on how to proceed with the  program. Program officials plan to propose new cost and schedule  baselines in June 2009 and have reported that they are addressing  immediate funding constraints by deferring selected activities to later  fiscal years in order to pay for VIIRS and CrIS problems; delaying the  launches of NPP, C1, and C2; and assessing alternatives for mitigating the  risk that VIIRS will continue to experience problems. Without an  executive-level decision on how to proceed, the program is proceeding on  a course that is deferring cost growth, delaying launches, and risking its  underlying mission of providing operational weather continuity to the civil  and military communities.
section_title: Executive Committee Has Not Effectively Fulfilled Its Responsibilities
paragraphs: While the NPOESS Executive Committee has made improvements over the  last several years in response to prior recommendations, it has not  effectively fulfilled its responsibilities and does not have the membership  and leadership it needs to effectively or efficiently oversee and direct the  NPOESS program. Specifically, the DOD Executive Committee member  with acquisition authority does not attend Committee meetings—and  sometimes contradicts the Committee’s decisions, the Committee does not  aggressively manage risks, and many of the Committee’s decisions do not  achieve desired outcomes. Independent reviewers, as well as program  officials, explained that the tri-agency structure of the program makes it  very difficult to effectively manage the program. Until these shortfalls are  addressed, the Committee is unable to effectively oversee the NPOESS  program—and important issues involving cost growth, schedule delays,  and satellite continuity will likely remain unresolved.
subsections: section_title: Executive Committee Has Responded to Past Recommendations
paragraphs: We and others, including the Department of Commerce’s Inspector  General in a 2006 report, have reported that the Committee was not  accomplishing its job effectively. However, since then, the Committee has  met regularly on a quarterly basis and held interim teleconferences as  needed. The Committee has also sought and reacted to advice from  external advisors by, among other actions, authorizing a government  program manager to reside onsite at the VIIRS contractor’s facility to  improve oversight of the sensor’s development on a day-to-day basis. More  recently, the Executive Committee sponsored a broad-based independent  review of the NPOESS program and is beginning to respond to its  recommendations.
section_title: Key Acquisition Executive Does Not Attend Executive Committee Meetings
paragraphs: As established by the 1995 and 2008 memorandums of agreement signed  by all three agencies, the members of the NPOESS Executive Committee  are (1) the Under Secretary of Commerce for Oceans and Atmosphere; (2)  the Under Secretary of Defense for Acquisition, Technology, and Logistics;  and (3) the NASA Administrator. Because DOD has the lead responsibility  for the NPOESS acquisition, the Under Secretary of Defense for  Acquisition, Technology, and Logistics was also designated as the  milestone decision authority—the individual with the authority to approve  a major acquisition program’s progression in the acquisition process, as  well as any changes to the cost, schedule, and functionality of the  acquisition. The intent of the tri-agency memorandums was that  acquisition decisions would be agreed to by the Executive Committee  before a final acquisition decision is made by the milestone decision  authority.
However, DOD’s acquisition authority has never attended an Executive  Committee meeting. This individual delegated the responsibility for  attending the meetings—but not the authority to make acquisition  decisions—to the Under Secretary of the Air Force. Therefore, none of the  individuals who attend the Executive Committee meetings for the three  agencies have the authority to approve the acquisition program baseline or  major changes to the baseline. As a result, agreements between Committee  members have been overturned by the acquisition authority, leading to  significant delays.
section_title: Committee Does Not Aggressively Manage Risks
paragraphs: To provide the oversight recommended by best practices, including  reviewing data and calling for corrective actions at the first sign of cost,  schedule, and performance problems and ensuring that actions are  executed and tracked to completion, the Executive Committee holds  quarterly meetings during which the program’s progress is reviewed using  metrics that provide an early warning of cost, schedule, and technical  risks. However, the Committee does not routinely document action items  or track those items to closure. Some action items were not discussed in  later meetings, and in cases where an item was discussed, it was not  always clear what action was taken, whether it was effective, and whether  the item was closed.
According to the Program Executive Officer, the closing of an action item  is not always explicitly tracked because it typically involves gathering  information that is presented during later Committee meetings.  Nonetheless, by not rigorously documenting action items—including  identifying the party responsible for the action, the desired outcome, and  the time frame for completion—and then tracking the action items to  closure, the Executive Committee is not able to ensure that its actions  have achieved their intended results and to determine whether additional  changes or modifications are still needed. This impedes the Committee’s  ability to effectively oversee the program, direct risk mitigation activities,  and obtain feedback on the results of its actions.
section_title: Committee Decisions Do Not Achieve Desired Outcomes
paragraphs: Best practices call for oversight boards to take corrective actions at the  first sign of cost, schedule, and performance slippages in order to mitigate  risks and achieve successful outcomes. The NPOESS Executive  Committee generally took immediate action to mitigate the risks that were  brought before them; however, a majority of these actions were not  effective—that is, they did not fully resolve the underlying issues or result  in a successful outcome. The Committee’s actions on the sensor  development risks accomplished interim successes by improving the  government’s oversight of a subcontractor’s activities and guiding next  steps in addressing technical issues—but even with Committee actions,  the sensors’ performance has continued to falter and affect the rest of the  program. Independent reviewers reported that the tri-agency structure of  the program complicated the resolution of sensor risks because any  decision could be revisited by another agency. Program officials explained  that interagency disagreements and differing priorities make it difficult to  effectively resolve issues.
section_title: Program Has Assessed Alternatives, but Has Not Yet Identified a Viable Alternative for Acquiring the Last Two NPOESS Satellites
paragraphs: When NPOESS was restructured in June 2006, the program included two  satellites (C1 and C2) and an option to have the prime contractor produce  the next two satellites (C3 and C4). In approving the restructured program,  DOD’s decision authority noted that he reserved the right to use a different  satellite integrator for the final two satellites, and that a decision on  whether to exercise the option was to be made in June 2010. To prepare  for this decision, DOD required a tri-agency assessment of alternative  management strategies. This assessment was to examine the feasibility of  an alternative satellite integrator, to estimate the cost and schedule  implications of moving to an alternative integrator, and within one year, to  provide a viable alternative to the NPOESS Executive Committee.
To address DOD’s requirement, the NPOESS Program Executive Officer  sponsored two successive alternative management studies; however,  neither of the studies identified a viable alternative to the existing satellite  integrator. The Program Executive Officer plans to conduct a final  assessment of alternatives prior to the June 2010 decision on whether to  exercise the option to have the current system integrator produce the next  two NPOESS satellites. Program officials explained that the program’s  evolving costs, schedules, and risks could mean that an alternative that  was not viable in the past would become viable. For example, if the prime  contractor’s performance no longer meets basic requirements, an  alternative that was previously too costly to be considered viable might  become so.
section_title: Implementation of Recommendations Could Improve Management and Oversight
paragraphs: In the report being released today, we are making recommendations to  improve the timeliness and effectiveness of acquisition decision-making on  the NPOESS program. Specifically, we recommend that the Secretary of  Defense direct the Under Secretary of Defense for Acquisition,  Technology, and Logistics to attend and participate in NPOESS Executive  Committee meetings. In addition, we are recommending that the  Secretaries of Defense and Commerce and the Administrator of NASA  direct the NPOESS Executive Committee to take the following five  actions: (1) establish a realistic time frame for revising the program’s cost  and schedule baselines; (2) develop plans to mitigate the risk of gaps in  satellite continuity; (3) track the Committee’s action items from inception  to closure; (4) improve the Committee’s ability to achieve successful  outcomes by identifying the desired outcome associated with each of the  Committee actions, as well as time frames and responsible parties, when  new action items are established; and (5) improve the Committee’s  efficiency by establishing time frames for escalating risks to the  Committee for action so that they do not linger unresolved at the program  executive level.
In written comments on a draft of our report, NASA and NOAA agreed  with our findings and recommendations and identified plans to implement  them. DOD concurred with one and partially concurred with our other  recommendations. For example, regarding our recommendation to have  the appropriate official attend Executive Committee meetings, the agency  partially concurred and noted that the Under Secretary for Acquisition,  Technology, and Logistics would evaluate the necessity of attending future  Executive Committee meetings. DOD also reiterated that the Under  Secretary of the Air Force was delegated authority to attend the meetings.  While we acknowledge that the Under Secretary delegated responsibility  for attending these meetings, it is an inefficient way to make decisions and  achieve outcomes in this situation. In the past, agreements between  Executive Committee members have been overturned by the Under  Secretary, leading to significant delays in key decisions. The full text of the  three agencies’ comments and our evaluation of those comments are  provided in the accompanying report.
In summary, continued problems in the development of critical NPOESS  sensors have contributed to growing costs and schedule delays. Costs are  now expected to grow by as much as $1 billion over the prior life cycle  cost estimate of $13.95 billion, and problems in delivering key sensors  have led to delays in launching NPP and the first two NPOESS satellites— by a year or more for NPP and the first NPOESS satellite. These launch  delays have endangered our nation’s ability to ensure the continuity of  polar-orbiting satellite data. Specifically, if any planned satellites fail on  launch or in orbit, there would be a gap in satellite data until the next  NPOESS satellite is launched and operational—a gap that could last for 3  to 5 years. The NPOESS Executive Committee responsible for making cost  and schedule decisions and addressing the many and continuing risks  facing the program has not yet made important decisions on program  costs, schedules, and risks—or identified when it will do so. In addition,  the Committee has not been effective or efficient in carrying out its  oversight responsibilities. Specifically, the individual with the authority to  make acquisition decisions does not attend Committee meetings, the  Committee does not aggressively manage risks, and many of the  Committee’s decisions do not achieve desired outcomes. Until the  Committee’s shortfalls are addressed, important decisions may not be  effective and issues involving cost increases, schedule delays, and satellite  continuity may remain unresolved.
Mr. Chairman and members of the Subcommittee, this concludes our  statement. We would be pleased to respond to any questions that you or  other members of the Subcommittee may have at this time.
section_title: Contact and Staff Acknowledgments
paragraphs: If you have any questions on matters discussed in this testimony, please  contact David A. Powner at (202) 512-9286 or at pownerd@gao.gov. Other  key contributors to this testimony include Colleen M. Phillips, Assistant  Director; Kate Agatone; Neil Doherty; Kathleen S. Lovett; Lee McCracken;  and China R. Williams.
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