NASA: Constellation Program Cost and Schedule Will Remain Uncertain Until a Sound Business Case Is Established
Published: 2009-08-26T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: NASA's Constellation program is developing the Ares I Crew Launch Vehicle and the Orion Crew Exploration Vehicle as the agency's first major efforts in a plan to return to the moon and eventually send humans to Mars. GAO has issued a number of reports and testimonies on various aspects of this program, and made several recommendations. GAO was asked to assess NASA's progress in implementing GAO's recommendations for the Ares I and Orion projects, and identify risks the program faces. GAO analyzed NASA plans and schedules, risk mitigation information, and contract performance data relative to knowledge-based acquisition practices identified in prior GAO reports, and interviewed government officials and contractors.
section_title: What GAO Found
paragraphs: NASA is still struggling to develop a solid business case--including firm requirements, mature technologies, a knowledge-based acquisition strategy, a realistic cost estimate, and sufficient funding and time--needed to justify moving the Constellation program forward into the implementation phase. Gaps in the business case include significant technical and design challenges for the Orion and Ares I vehicles, such as limiting vibration during launch, eliminating the risk of hitting the launch tower during lift off, and reducing the mass of the Orion vehicle, represent considerable hurdles that must be overcome in order to meet safety and performance requirements; and a poorly phased funding plan that runs the risk of funding shortfalls in fiscal years 2009 through 2012, resulting in planned work not being completed to support schedules and milestones. This approach has limited NASA's ability to mitigate technical risks early in development and precludes the orderly ramp up of workforce and developmental activities. In response to these gaps, NASA delayed the date of its first crewed-flight and changed its acquisition strategy for the Orion project. NASA acknowledges that funding shortfalls reduce the agency's flexibility in resolving technical challenges. The program's risk management system warned of planned work not being completed to support schedules and milestones. Consequently, NASA is now focused on providing the capability to service the International Space Station and has deferred the capabilities needed for flights to the moon. Though these changes to the overarching requirements are likely to increase the confidence level associated with a March 2015 first crewed flight, these actions do not guarantee that the program will successfully meet that deadline. Nevertheless, NASA estimates that Ares I and Orion represent up to $49 billion of the over $97 billion estimated to be spent on the Constellation program through 2020. While the agency has already obligated more than $10 billion in contracts, at this point NASA does not know how much Ares I and Orion will ultimately cost, and will not know until technical and design challenges have been addressed.

section_title: Letter
paragraphs: The National Aeronautics and Space Administration’s (NASA)  Constellation program is approaching a crossroads in development as it  nears entry into the implementation phase. The Constellation program is  developing the Ares I Crew Launch Vehicle and the Orion Crew  Exploration Vehicle, the agency’s first major efforts to support  implementation of the Vision for Space Exploration. These efforts  represent a substantial investment for NASA. Over $10 billion has already  been obligated and NASA budget estimates indicate that over $97 billion is  to be spent on the Constellation program through 2020. NASA initiated the  Constellation program in November 2005 and expected the program to  enter implementation in 2009. The program has delayed its entry into  implementation, however, and is still modifying its overall architecture  and specific requirements. Our previous work on best practices and  NASA’s own acquisition policies indicate that the program’s architecture  and requirements should be finalized and system designs expected to meet  requirements in hand before a program enters the implementation phase.  NASA recognized that the program faces challenges and in December 2008  reported that the current program was high risk and unachievable within  current budget and schedule constraints. Since then, NASA has taken  steps to decrease risk, including delaying the first crewed flight from  September 2014 to March 2015 and deferring work on lunar requirements.
In May 2009, the Obama Administration announced an independent review  of U.S. human space flight plans and activities with the stated goal of  ensuring that the nation is pursuing the best course for the future of  human space flight. This Review of U.S. Human Space Flight Plans  Committee is composed of space industry experts, former astronauts,  government officials, and academics. It is tasked with providing a range of  options for U.S. human space flight activities and has been examining  ongoing and planned NASA development activities and potential  alternatives in order to present options for advancing a safe, innovative,  affordable, and sustainable human space flight program following the  space shuttle’s retirement. Among alternatives that have received attention  is the use of the Evolved Expendable Launch Vehicle program, which  already provides launch capability to the Department of Defense, the  National Reconnaissance Office, and NASA, but has not been used to  transport humans into space. The committee plans to complete this review  by August 2009 and include any changes to current plans in an amended  submission to its fiscal year 2010 budget request. NASA is continuing to  execute the Constellation program as this review is conducted.
We have issued a number of reports and testimonies that touch on various  aspects of NASA’s Constellation program and in particular the  development efforts under way for the Orion and Ares I projects. These  reports and testimonies have questioned the affordability and overall  acquisition strategy for each project and have stressed repeatedly NASA’s  need to develop a sound business case — which includes firm  requirements, mature technologies, a knowledge-based acquisition  strategy, a realistic cost estimate, and sufficient funding and time — to  support the Constellation program before making long-term commitments.  In the past, we recommended that NASA modify the Orion Crew Vehicle  acquisition strategy to ensure the agency did not commit itself to a long- term contractual obligation prior to establishing a sound business case.  Although initially NASA disagreed with our recommendation, the agency  subsequently revised its acquisition strategy to address some of the  concerns we raised. We have also recommended that NASA ensure the  business case for the Ares I project is established before proceeding  beyond preliminary design review. NASA concurred with this  recommendation and subsequently delayed the Ares I preliminary design  review. In February 2009 NASA determined that the Orion project was not  ready to begin the preliminary design review process and delayed  initiation of the Orion review until August 2009 (see fig. 1). In response to  your request that we review the Constellation program, this report  assesses the extent to which NASA has implemented our prior  recommendations, including establishing a sound business case for the  Ares I and Orion projects, and identifies risks, if any, facing the program.
To address these objectives, we obtained and analyzed Constellation plans  and schedules, risk mitigation information, and contract performance data  relative to knowledge-based acquisition practices identified in prior  reports. We also interviewed government and contractor officials at  relevant NASA centers and NASA headquarters. For our full scope and  methodology, see appendix I. We conducted this performance audit from  December 2008 through August 2009, 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: NASA’s Vision for Space Exploration calls for a return of humans to the  Moon and eventual human spaceflight to Mars. In September 2005, NASA  outlined an initial architecture for implementing the Vision in its  Exploration Systems Architecture Study (ESAS). NASA is implementing  this architecture under the Constellation program. Among the first major  efforts of this program are the developments of new space flight  systems—including the Ares I Crew Launch Vehicle and the Orion Crew  Exploration Vehicle. Ares I and Orion are currently targeted for operation  no later than 2015 (see fig. 1).
As illustrated by figure 1 above, the Constellation program, including the  Ares I and Orion projects, is approaching the end of the formulation phase  of NASA’s acquisition life-cycle for spaceflight programs and projects. The  purpose of the formulation phase is to establish a cost-effective program  that is demonstrably capable of meeting the agency’s objectives. The  formulation phase concludes with the preliminary design review and a  non-advocate review which marks the end of the formulation phase and  the beginning of the implementation phase. During the implementation  phase, the program will execute plans developed during the formulation  phase.
subsections: section_title: Our Work on Best Practices Support Business Case Establishment Prior to Product Development
paragraphs: Our work on best practices over the past decade has shown that success  in large-scale development efforts like Constellation depends on  establishing an executable business case before committing resources to a  new product development effort. In its simplest form, a business case  requires a balance between the concept selected to satisfy customer needs  and the resources—technologies, design knowledge, funding, time, and  management capacity—needed to transform the concept into a product. At  the heart of a business case is a knowledge-based approach that requires  that managers demonstrate high levels of knowledge as the program  proceeds from technology development to system development and,  finally, production. Ideally, in such an approach, key technologies are  demonstrated before development begins, the design is stabilized before  prototypes are built or production begins, and testing is used to validate  product maturity at each level. At each decision point, the balance among  time, money, and capacity is confirmed. In essence, knowledge supplants  risk over time. Having adequate knowledge about requirements and  resources is particularly important for a program like Constellation  because human spaceflight development projects are inherently complex,  difficult, and costly.
We have reported on several occasions that within NASA’s acquisition  framework, the preliminary design/non-advocate review—the hurdle  marking transition from program formulation to program  implementation—is the point at which development projects should have  a sound business case in hand. NASA’s Systems Engineering Policy states  that the preliminary design review demonstrates that the preliminary  design meets all system requirements with acceptable risk and within the  cost and schedule constraints. NASA realized that the Orion project was  not ready to complete the preliminary design review process as planned  and delayed its initiation from summer 2008 to summer 2009.  Furthermore, although NASA officially closed the Ares I preliminary  design review process in September 2008, it deferred resolution of the  thrust oscillation issue until the Constellation program preliminary design  review in March 2010.
The business case is the essential first step in any acquisition program that  sets the stage for the remaining stages of a program, namely the business  or contracting strategy and actual execution or performance. If the  business case is not sound, execution may be subpar. This does not mean  that all potential problems can be eliminated and perfection achieved, but  rather that sound business cases can help produce better outcomes and  better return on investment. If any one element of the business case is  weak, problems are more likely in implementation. Thus far in the  Constellation program, the failure of NASA to establish a sound business  case for both the Ares I and Orion projects early is manifesting itself in  schedule delays and cost increases.
section_title: The Constellation Program Has Not Yet Developed the Sound Business Case Needed to Justify Entry into the Implementation Phase
paragraphs: The Constellation program has not yet developed all of the elements of a  sound business case needed to justify entry into implementation. Progress  has been made; however, technical and design challenges are still  significant and until they are resolved NASA will not be able to reliably  estimate the time and money needed to execute the program. In addition,  cost issues and a poorly phased funding plan continue to hamper the  program. Consequently, NASA is changing the acquisition strategy for the  Orion project as the agency attempts to increase confidence in its ability to  meet a March 2015 first crewed launch. However, technical design and  other challenges facing the program are not likely to be overcome in time  to meet the 2015 date, even with changes to scope and requirements.
subsections: section_title: Constellation Faces Significant Technical and Design Challenges
paragraphs: Technical and design challenges within the Constellation are proving  difficult, costly, and time intensive to resolve. The Constellation program  tracks technical challenges in its Integrated Risk Management Application  (IRMA). NASA procedures recommend that programs identify and track  risks as part of continuous risk management. As of June 9, 2009, IRMA was  tracking 464 risks for Ares I and Orion—207 high risks, 206 medium risks,  and 51 low risks. We have reported on some of these areas of technical  challenge in the past, including thrust oscillation, thermal protection  system, common bulkhead, and J-2X nozzle extension. In addition to these  challenges, our recent work has highlighted other technical challenges,  including Orion mass control, vibroacoustics, lift-off drift, launch abort  system, and meeting safety requirements. While NASA has made progress  in resolving each of these technical challenges, significant knowledge gaps  remain in each of these areas. Descriptions of these technical challenges  follow.
subsections: section_title: Thrust Oscillation
paragraphs: Thrust oscillation, which causes shaking during launch and ascent, occurs  in some form on every solid rocket engine. Last year, we reported that  computer modeling indicated that there was a possibility that the thrust  oscillation frequency and magnitude may be outside the limits of the Ares I  design and could potentially cause excessive vibration in the Orion  capsule. Agency officials stated that thrust oscillation is well understood  and they are pursuing multiple solutions. These include incorporating a  passive damping system inside the first stage solid rocket booster aft skirt  that will act like a shock absorber during launch; adding a composite  structure and springs between the first and second stages to isolate the  upper stage and crew vehicle from the first stage; and could possibly use  the upper stage propellant fuel tanks to offset thrust oscillation in the first  stage. Officials said that NASA will be unable to verify the success of  solutions until thrust oscillation occurs during an integrated flight.  Officials noted that because thrust oscillation is not expected to occur in  every flight, it is difficult to forecast when the solutions will be verified.
section_title: Thermal Protection System
paragraphs: The Orion vehicle requires a large-scale ablative heat shield, at the base of  the spacecraft, to survive reentry from earth orbit. These heat shields burn  up, or ablate, in a controlled fashion, transporting heat away from the  crew module during its descent through the atmosphere. NASA is using an  ablative material derived from the substance used in the Apollo program.  After some difficulties, NASA was successful in recreating the material.  Because it uses a framework with many honeycomb-shaped cells, each of  which must be individually filled without voids or imperfections, it may be  difficult to repeatedly manufacture to consistent standards. According to  program officials, during the Apollo program the cells were filled by hand.  The contractor plans to automate the process for the Orion Thermal  Protection System, but this capability is still being developed.
section_title: Common Bulkhead
paragraphs: The common bulkhead separates the hydrogen and oxygen fuel within the  Ares I upper stage fuel tank. The initial Ares I design employed a simpler  two-tank configuration with lower manufacturing costs but did not meet  mass requirements. According to project officials, the common bulkhead  represents the critical path in both the development and manufacturing of  the upper stage. Lessons learned from the Apollo program indicate that  common bulkheads are complex and difficult to manufacture and  recommend against their use. According to NASA officials, the difficulty of  designing and manufacturing common bulkheads stems from the sheer  size of components and the tight tolerances to which they must be  manufactured. To accelerate the manufacturing process NASA is exploring  using an oven with a vacuum bag instead of an autoclave to bond and  cure the metallic and composite materials used in the manufacture of the  common bulkhead. If this process proves unsuccessful, the program may  encounter schedule delays.
section_title: J-2X Nozzle Extension
paragraphs: We have reported in prior years that although the J-2X engine is based on  the J-2 and J-2S engines used on the Saturn V and leverages knowledge  from subsequent engine development efforts, the number of planned  changes is such that, according to NASA review boards, the effort  essentially represents a new engine development. A risk within this  development is a requirement for a nozzle extension to meet performance  requirements. NASA originally planned to pursue a composite nozzle.  However, NASA eliminated the composite nozzle extension from the J-2X  design because of cost and other considerations, and went with a unique  aluminum alloy design, which, according to agency officials, should  reduce costs, but has the potential to decrease engine performance and  increase mass. Analysis indicates that the alloy nozzle is more likely to be  affected by heat than a composite nozzle. In essence, while the alloy  nozzle should withstand the heat environment, the composite nozzle  allowed for improved performance margins. According to officials, to  mitigate the potential problem, NASA is using a proven aluminum alloy  with a honeycomb design, similar structurally to the Space Shuttle  external tank, which will reduce weight. Contractor officials stated that  they will continue to modify the nozzle design as test results are received  and analyzed.
section_title: Orion Mass Control
paragraphs: Controlling for mass has led to significant design changes to the Orion  vehicle. Our previous work has shown that controlling for mass is a key  factor in the development of space systems. As the mass of a particular  system increases, the power or thrust required to launch that system will  also increase. This could result in the need to develop additional power or  thrust capability to lift the system, leading to additional costs, or to  stripping down the vehicle to accommodate current power or thrust  capability. For example, NASA went through the process in 2007 to zero- base the design for the Orion to address mass concerns. In its efforts to  reduce the mass of the Orion vehicle, NASA chose to move from land  nominal landing to water nominal landing to reduce mass by eliminating  air bags and, according to officials, by reducing the number of parachutes.
NASA also incorporated jettisonable, load-bearing fairings into the  Orion’s service module design that, according to officials, saved 1,000  pounds. This change, however, increased development risk because the  fairing design has no historical precedent and the fairing panels may not  deploy properly and could recontact the Orion vehicle or the Ares I rocket  after they are jettisoned.
section_title: Vibroacoustics
paragraphs: Another issue related to vibration is vibroacoustics—the pressure of the  acoustic waves—produced by the firing of the Ares I first stage and the  rocket’s acceleration through the atmosphere—which may cause  unacceptable structural vibrations throughout Ares I and Orion. According  to agency officials, NASA is still determining how these vibrations and  acoustic environments may affect the vehicles. NASA is concerned that  severe vibroacoustics could force NASA to qualify Ares I and Orion  components to higher vibration tolerance thresholds than originally  expected. For example, if current concerns are realized, key subsystems  within the Upper Stage would be unable to meet requirements, would fail  qualification testing, and would have to be redesigned.
section_title: Lift-Off Drift
paragraphs: Analysis of the Ares I flight path as it lifts off from the launch pad indicates  the rocket may drift during launch and could possibly hit the launch tower  or damage the launch facilities with the rocket plume. Factors  contributing to lift-off drift include wind speed and direction,  misalignment of the rocket’s thrust, and duration of lift-off. NASA plans to  establish a clear, safe, and predicted lift-off drift curve by steering the  vehicle away from the launch tower and not launching when southerly  winds exceed 15 to 20 knots.
section_title: Launch Abort System
paragraphs: NASA continues to address challenges designing the launch abort system,  which pulls the Orion capsule away from the Ares I launch vehicle in the  case of a catastrophic problem during launch. The Orion contractor had  trouble finding a subcontractor who could design and build a working  attitude control motor that steers the system during an abort. According to  agency officials, previous attitude control motors have had 700 pounds of  thrust, while the requirement for the attitude control motor is 7,000  pounds of thrust. Developing an attitude control motor with high levels of  thrust and long burn durations that is steerable is proving to be a difficult  technical challenge. A year after the initial contract was awarded, the first  subcontractor did not have a viable design and had to be replaced. The  current subcontractor, however, is making progress. For example,  although the valves used by the complex steering system failed during  high-thrust testing in April 2008, redesigned valves have subsequently  passed two high-thrust tests.
section_title: Safety Requirements
paragraphs: Orion’s safety requirements are no more than one loss of crew event in  1,700 flights and one loss of mission event for every 250 flights for the ISS  mission. According to Orion officials, these requirements are an order of  magnitude higher than the Space Shuttle’s safety requirements, were  arbitrarily set by ESAS, and may be unattainable. According to the  Constellation program manager, NASA has added robustness to current  systems as well as redundant systems to increase safety margins.  However, these added redundancies and system robustness have added  mass to the system.
The technical challenges presented here do not capture all of the risks,  technical or programmatic, which the Constellation program faces. As  noted earlier, there are over 200 risks categorized as “high” for the Ares  I/Orion programs, meaning that if not successfully mitigated, these risks  (1) are either nearly certain, highly likely, or may occur, and (2) will have  major effects on system cost, schedule, performance, or safety. These  risks range in nature from highly complex technical risks, such as those  noted above, to straightforward programmatic risks related to areas such  as transitioning support work from the Marshall Space Flight Center to  Michoud Assembly Facility for long-term vehicle production, compressing  the software development cycle for the Orion vehicle, and creating a test  program for Orion’s communication and tracking system.
section_title: Funding Issues and Cost Increases Continue to Hamper the Program
paragraphs: The Constellation program’s poorly phased funding plan has affected the  program’s ability to deal with technical challenges. In our October 2007  report, we noted that NASA initiated the Constellation program  recognizing that the agency’s total budget authority would be insufficient  to fund all necessary activities in fiscal years 2009 and 2010. NASA’s  funding strategy relied on the accumulation of a large rolling budget  reserve in fiscal years 2006 and 2007 to fund Constellation activities in  fiscal years 2008, 2009, and 2010. Thereafter, NASA anticipated that the  retirement of the space shuttle program in 2010 would free funding for the  Constellation program. In our October 2007 report, we noted that NASA’s  approach to funding was risky and that the approved budget profile at that  time was insufficient to meet Constellation’s estimated needs. The  Constellation program’s integrated risk management system also identified  this strategy as high risk and warned that funding shortfalls could occur in  fiscal years 2009 through 2012, resulting in planned work not being  completed to support schedules and milestones. According to project  officials, these shortfalls limited NASA’s ability to mitigate technical risks  early in development and precluded the orderly ramp-up of workforce and  developmental activities.
According to the Constellation program manager, these funding shortfalls  are reducing his flexibility to resolve technical challenges. The  Constellation program tracks unfunded risk mitigation—engineering work  identified as potentially needed but not currently funded—as cost threats  in IRMA. The Constellation IRMA system currently tracks 192 cost threats  for the Ares I and Orion projects totaling about $2.4 billion through fiscal  year 2015. Of this $2.4 billion, NASA classifies 35 threats valued at about  $730 million as likely to be needed, 54 threats valued at about $670 million  as may or may not be needed, and 103 threats valued at about $1 billion as  not likely to be needed. Our analysis of the cost threats indicates these  cost threats may be understated. For example, of the 157 threats classified  as may or may not be needed or not likely to be needed, IRMA likelihood  scores indicate that 69 cost threats worth about $789 million are either  highly likely or nearly certain to occur. Some examples of cost threats  include $4.7 million to develop and mature Orion’s data network  technology and $12.5 million for an Upper Stage and First Stage separation  test.
The cost of the Constellation program’s developmental contracts have  increased as NASA added new effort to resolve technical and design  challenges. Constellation program officials and contractor cost reports  indicate that the new effort has increased the value of the Constellation  program’s developmental contracts from $7.2 billion in 2007 to $10.2  billion in June 2009. Some of these modifications remained undefinitized  for extended periods as NASA worked through design issues and matured  program requirements in response to technical challenges. Undefinitized  contract actions authorize contractors to begin work before reaching a  final agreement on contract terms. By allowing undefinitized contract  actions to continue for extended periods, NASA loses its ability to monitor  contractor performance because the cost reports are not useful for  evaluating the contractor’s performance or for projecting the remaining  cost of the work under contract. With a current, valid baseline, the reports  would indicate when cost or schedule thresholds had been exceeded, and  NASA could then require the contractor to explain the reasons for the  variances and to identify and take appropriate corrective actions. Yet,  NASA allowed high-value modifications to the Constellation contracts to  remain undefinitized for extended periods, in one instance, more than 13  months.
section_title: Tradeoffs Made to Address Cost Increases and Funding Shortfalls Are Changing Constellation Program Test Strategy
paragraphs: In August 2008, when faced with cost increases and funding shortfalls, the  Constellation program responded by reducing program reserves and  deferring development effort and test activities. These changes resulted in  a minimized flight test program that was so success oriented there was no  room for test failures. During the course of our review, NASA test officials  expressed multiple concerns about the test approach the program was  then pursuing. NASA test officials also expressed concerns about the  sufficiency of planned integrated system flight testing. NASA was planning  only one integrated system flight test prior to the first crewed flight.  Officials stated that while NASA would have been able to address each of  the programs’ specific test objectives during the planned flight tests,  additional integrated system flight tests could have provided the agency  increased confidence that the system performed as planned and allowed  the agency the opportunity to design and implement solutions to  performance problems without affecting the first crewed flight. According  to agency officials, any problems encountered during integrated system  flight testing could lead to significant delays in the first crewed flight.
Test officials were also concerned that the highly concurrent test schedule  had significant overlap between component qualification and fabrication  of flight hardware. This concurrency could have resulted in schedule slips  and increased costs if any component failed qualification tests. Our past  work indicates that it is unlikely that the program will complete its test  program without encountering developmental problems or test failures.  The discovery of problems in complex products is a normal part of any  development process, and testing is perhaps the most effective tool for  discovering such problems. According to the Constellation program  manager, the test plan strategy for the Constellation program is currently  evolving as the program reshapes its acquisition strategy to defer all work  on lunar content beyond the March 2015 first crewed flight. The test  strategy is likely to continue to evolve until the Constellation program’s  Systems Integration Plan is finalized when the project enters the  implementation phase.
section_title: Changing Acquisition Strategy
paragraphs: In response to technical challenges and cost and funding issues, NASA is  changing the Orion project acquisition strategy. In December 2008, NASA  determined that the current Constellation program was high risk and  unachievable within the current budget and schedule. To increase its level  of confidence in the Constellation program baseline NASA delayed the  first crewed flight from September 2014 to March 2015 and according to  officials, adopted a two-phased approach to developing the Orion vehicle.  NASA’s original strategy for the Orion project was to develop one vehicle  capable of supporting both ISS and lunar missions. According to the  Constellation program manager, the Constellation program is currently  deferring work on Orion lunar content beyond 2015 to focus its efforts on  developing a vehicle that can fly the ISS mission. This phased approach,  however, could require two qualification programs for the Orion vehicle— one pre-2015 Orion qualification program for ISS mission requirements  and a second post-2015 Orion qualification program for lunar mission  requirements.
According to the program manager, the knowledge gained from flying the  initial Orion to the ISS will inform the design of the lunar vehicle. The  Constellation program manager also told us that NASA is unwilling to  further trade schedule in order to reduce risk. He asserted that delaying  the schedule is an inefficient means of mitigating risk because of the high  costs of maintaining fixed assets and contractor staff.
Though these changes to overarching requirements are likely to increase  the confidence level associated with the March 2015 first crewed flight,  they do not guarantee that the program will conduct a successful first  crewed flight in March 2015. For example, in May 2009 the program  announced its plan to reduce the number of crew for the ISS mission from  six to four. According to project officials, NASA does not plan to finalize  the preliminary design of the four-crew ISS configuration until after the  Orion preliminary design review. Revising the ISS design for four crew and  optimizing the area freed up by removing two crew for the ISS mission will  entail additional effort on the part of the Orion design team. Furthermore,  as noted above, both the Ares I and Orion projects continue to face  technical and design challenges that will require significant time, money,  and effort to resolve irrespective of the decision to defer lunar  requirements. While deferring the lunar requirement is likely to relieve  pressure on Orion’s mass margins allowing increased flexibility to deal  with some Orion-specific technical challenges, the lunar requirement has  little bearing on many of the Ares I technical challenges discussed above.  Furthermore, it is unclear how deferring the lunar requirement will affect  the technical challenges faced in the development of the Orion launch  abort system and in dealing with vibroacoustics.
section_title: Conclusion
paragraphs: NASA’s human spaceflight program is at a crossroads. Efforts to establish  a sound business case for Constellation’s Ares I and Orion projects are  complicated by (1) an aggressive schedule, (2) significant technical and  design challenges, (3) funding issues and cost increases, and (4) an  evolving acquisition strategy that continues to change Orion project  requirements. Human spaceflight development programs are complex and  difficult by nature and NASA’s previous attempts to build new  transportation systems have failed in part because they were focused on  advancing technologies and designs without resources—primarily time  and money—to adequately support those efforts. While the current  program, Constellation, was originally structured to rely on heritage  systems and thus avoid problems seen in previous programs, the failure to  establish a sound business case has placed the program in a poor risk  posture to proceed into implementation as planned in 2010. In the past,  NASA has recognized these shortfalls and has delayed design reviews for  both the Ares I and Orion vehicles in an effort to gain the knowledge  needed for a sound business case. NASA’s current approach, however, is  based on changing requirements to increase confidence in meeting the  schedule. Nevertheless, the need to establish a sound business case,  wherein resources match requirements and a knowledge-based acquisition  strategy drives development efforts, is paramount to any successful  program outcome. Until the Constellation program has a sound business  case in hand, it remains doubtful that NASA will be able to reliably  estimate cost and schedule to complete the program.
Meanwhile, the new Administration is conducting an independent review  of NASA’s human spaceflight activities, with the potential for  recommendations of broad changes to the agency’s approach toward  future efforts. While the fact that the review is taking place does not  guarantee wholesale changes to the current approach, it does implicitly  recognize the challenges facing the Constellation program. We believe this  review is appropriate as it presents an opportunity to reassess both  requirements and resources for Constellation as well as alternative ways  for meeting requirements.
section_title: Recommendations
paragraphs: Regardless of NASA’s final plans for moving forward, the agency faces  daunting challenges developing human rated spacecraft for use after the  Space Shuttle is retired, and it is important that the agency lay out an  acquisition strategy grounded in knowledge-based principles that is  executable with acceptable levels of risk within the program’s available  budget. As NASA addresses the findings and recommendations of the  Review of U.S. Human Space Flight Plans Committee, we recommend  that the new NASA Administrator direct the Constellation program, or its  successor, to develop a sound business case—supported by firm  requirements, mature technologies, a preliminary design, a realistic cost  estimate, and sufficient funding and time—before proceeding into  implementation, and, if necessary, delay the preliminary design review  until a sound business case demonstrating the program’s readiness to  move forward into implementation is in hand.
section_title: Agency Comments and Our Evaluation
paragraphs: In written comments on a draft of this report (see app. II), NASA  concurred with our recommendation. NASA acknowledged that, while  substantial work has been completed, the Constellation program faces  knowledge gaps concerning requirements, technologies, funding,  schedule, and other resources.  NASA stated that it is working to close  these gaps before committing to significant, long-term investments in the  Constellation program. NASA stated that the Constellation program  manager is required to demonstrate at the preliminary design review that  the program and its projects meet all system requirements with acceptable  risk and within cost and schedule constraints, and that the program has  established a sound business case for proceeding into the implementation  phase. At this point, the NASA Agency Program Management Council will  review the Constellation program and determine the program’s readiness  to proceed into the implementation phase and begin detailed design.  Separately, NASA provided technical comments, which have been  addressed in the report, as appropriate.
As agreed with your offices, unless you announce its contents earlier, we  will not distribute this report further until 30 days from its date. At that  time, we will send copies to NASA’s Administrator and interested  congressional committees. In addition, the report will be available at no  charge on the GAO Web site at http://www.gao.gov.
Should you or your staff have any questions on matters discussed in this  report, please contact me at (202) 512-4841 or at ChaplainC@gao.gov.  Contact points for our Offices of Congressional Relations and Public  Affairs may be found on the last page of this report. GAO staff that made  key contributions to this report are listed in appendix III.
section_title: Appendix I: Scope and Methodology
paragraphs: To assess NASA’s progress toward establishing a sound business case for  the Ares I and Orion projects and identify key technical challenges NASA  faces in developing the Ares I Crew Launch and the Orion Crew  Exploration Vehicles, we obtained and analyzed Constellation plans and  schedules, risk mitigation information, and contract performance data  relative to the standards in our knowledge-based acquisition practices  including program and project plans, contracts, schedules, risk  assessments, funding profile, budget documentation, earned value reports,  and the results of NASA’s assessments of the program. We interviewed and  received briefings from officials associated with the Constellation program  office, including Exploration Systems Mission Directorate officials at  NASA headquarters in Washington, D.C.; Orion project and Constellation  program officials at the Johnson Space Center in Houston, Texas; and,  Ares I and J-2X officials at the Marshall Space Flight Center in Huntsville,  Alabama, regarding the program and projects’ risk areas and test strategy,  technical challenges, the status of requirements, acquisition strategy and  the status of awarded contracts.
We also conducted interviews and received briefings from NASA  contractors on heritage hardware and design changes, and top risks and  testing strategy, for the J-2X engine, Ares I First Stage, Ares I Upper Stage,  Launch Abort System, and Orion vehicle. We analyzed risk documented  through the Constellation program’s Integrated Risk Management  Application and followed up with project officials for clarification and  updates to these risks. We also attended the Constellation Program’s  Quarterly Risk Review at the Johnson Space Center.
In addition, we interviewed Constellation program officials from Johnson  Space Center about program risks, requirements, and the impact of budget  reductions. We also spoke with NASA headquarters officials from the  Exploration Systems Mission Directorate’s Resources Management Office  in Washington, D.C., to gain insight into the program’s top risks and the  basis for fiscal year 2006 through fiscal year 2010 budget requests as well  as the funding strategy employed by the Constellation program.  Furthermore, we reviewed NASA’s program and project management  directives and systems engineering directives. Our review and analysis of  these documents focused on requirements and goals set for spaceflight  systems. We compared examples of the centers’ implementation of the  directives and specific criteria included in these directives with our best  practices work on system acquisition.
We conducted this performance audit from December 2008 through  August 2009 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.
section_title: Appendix II: Comments from the National Aeronautics and Space Administration
section_title: Appendix III: GAO Contacts and Staff Acknowledgments
subsections: section_title: GAO Contacts
section_title: Acknowledgments
paragraphs: In addition to the contact named above, Jim Morrison, Assistant Director;  Jessica M. Berkholtz; Greg Campbell; Jennifer K. Echard; Nathaniel J.  Taylor; John S. Warren Jr.; and Alyssa Weir made key contributions to this  report.
section_title: Related GAO Products
paragraphs: NASA: Assessments of Selected Large-Scale Projects. GAO-09-306SP.  Washington, D.C.: March 2, 2009.
NASA: Agency Faces Challenges Defining Scope and Costs of Space  Shuttle Transition and Retirement. GAO-08-1096. Washington, D.C.:  September 30, 2008.
NASA: Ares I and Orion Project Risks and Key Indicators to Measure  Progress. GAO-08-186T. Washington, D.C.: April 3, 2008.
NASA: Agency Has Taken Steps Toward Making Sound Investment  Decisions for Ares I but Still Faces Challenging Knowledge Gaps.  GAO-08-51. Washington, D.C.: October 31, 2007.
NASA: Issues Surrounding the Transition from the Space Shuttle to the  Next Generation of Human Space Flight Systems. GAO-07-595T.  Washington, D.C.: March 28, 2007.
NASA: Long-Term Commitment to and Investment in Space Exploration  Program Requires More Knowledge. GAO-06-817R. Washington, D.C.: July  17, 2006.
NASA: Implementing a Knowledge-Based Acquisition Framework Could  Lead to Better Investment Decisions and Project Outcomes. GAO-06-218.  Washington, D.C.: December 21, 2005.
Defense Space Activities: Continuation of Evolved Expendable Launch  Vehicle Program’s Progress to Date Subject to Some Uncertainty.  GAO-04-778R. Washington, D.C.: June 24, 2004.
Best Practices: Using a Knowledge-Based Approach to Improve Weapon  Acquisition. GAO-04-386SP. Washington, D.C.: January 2004.