Date: 1994-08-02
Speaker: JOHN H. GIBBONS (democrat)
Chamber: S

Science Advisor to the President. Office of Science and Technology Policy. Washington. DC. DEAR JACK: After attending the review of the International Space Station in Houston on March 2526. 1994. I wanted to let you know *personally how impressed my colleagues and I were at the progress NASA has made since our last meeting in September. There has been nothing short of a dramatic improvement in the program management. budgeting and contract process. We spent a full nine hours on March 24th with the NASA and Boeing cost teams. With representatives of .NASA IG. G4O. OMB OSTP and NASA Headquarters present. the budget numbers for the reserve contingencies- and unresolved adjustments were presented for everyone to see. It is a remarkable statement about the new openness. confidence. candor and philosophy of costing. The costing process is consistent with previous Committee recommendations. We believe that the International Space Station Alpha program can be implemented with an expected budget authority of S2.lB/year. The team. where appropriate. has departed from the use of parametrics and "Freedom" deltas. and relied more on "bottoms up" and/or zerobased estimates. It is a very tight cost picture and we have much more confidence in the costs now than we did a year ago. In our opinion. NASA has successfully implemented a process which exemplifies the concept of the national performance review. NASAs incorporation of progressive Integrated Product Team concepts. i.e. each team with authority. accountability and responsibility. will maximize the likely achievement of financial objectives. The new single prime and realigned. contractors approach. synergy between NASA. contractor and oversight organization. concurrent factfinding and constant "real time" problem resolution. provide confidence that NASA can stay within the cost parameters and guidance given by OMB. The Boeing personnel. led by Mr. Larry Winslow. and NASAs new business manager. Mr. Dan Tam. have the leadership and expertise to successfully implement the current station plans on schedule and on cost. As the "scrubbing" process continues toward definitization of the contract. there appears to be resolution of acceptable costs. reserves and award fee structure. Areas of uncertainty still exist within the Russian area of participation. The NASA program office has not had the opportunity to finalize costs for upgrading the MIR. a service module. the tug and other modifications. The scope of the Russian participation is not as clearly delineated as other participants. However. both parties are actively pursuing resolution and clarification with a target of June 1994. The Russian reserves and cost estimates appear adequate and the contracting process with a "cap" on incurred costs minimize risk of additional NASA expenditures. We believe that the costs of S2.1B year and $17AB runout through 2002 are successoriented but achievable. It is critical to understand that it is priced to specific launch and operational readiness dates. At this point. critical elements of a successful space station program include a strong national commitment and appropriation stability. If I can be of further help. please do not hesitate to call. Sincerely.