Costs Having Almost Doubled, Satellite Program May See More Overruns

The Geostationary Operational Environmental Satellites-R series (GOES-R), which already has seen its price tag soar to $11.4 billion from $6.2 billion, stands in danger of seeing further cost increases, missed schedules and performance shortfalls, the Government Accountability Office (GAO) reported.

Reform moves should be imposed on the program so that it avoids the troubles that plagued other satellite constellation programs, David A. Powner GAO director of information technology management issues, told Congress.

The satellites are vital for U.S. meteorology programs. “This new series is considered critical to the United States’ ability to maintain the continuity of data required for weather forecasting through the year 2028,” according to Powner, who testified before the House Science Committee.

To avoid further problems, Powner urged the National Oceanic and Atmospheric Administration (NOAA) to take these steps:

It should establish realistic cost and schedule estimates, ensure sufficient technical readiness of the system’s components prior to key decisions, provide sufficient management at government and contractor levels, and perform adequate senior executive oversight to ensure mission success.

“Until it completes these activities, NOAA faces an increased risk that the GOES-R program will repeat the increased cost, schedule delays, and performance shortfalls that have plagued past procurements,” Powner said.

GOES-R doesn’t need any further problems, Powner indicated. Earlier woes have forced NOAA to cut the program deeply, even as costs soared.

“At the time of our review, NOAA was nearing the end of the preliminary design phase of its GOES-R system … which [once] was estimated to cost $6.2 billion and scheduled to have the first satellite ready for launch in 2012,” according to the GAO.

“While NOAA expected to award a contract in August 2007 to develop this system, recent analyses of the GOES-R program cost — which in May 2006 the program office estimated could reach $11.4 billion — have led the agency to consider reducing the scope of requirements for the satellite series,” according to the GAO witness.

“Since our report was issued, NOAA officials told GAO that the agency has made a decision to reduce the scope of the program to a minimum of two satellites and to reduce the complexity of the program by canceling a technically complex instrument.”

To be sure, it isn’t as though NOAA hasn’t attempted to bring the program to heel.

“NOAA has taken steps to implement lessons learned from past satellite programs, but more remains to be done,” according to Powner.

Noting that prior satellite programs, including a prior GOES series, a polar-orbiting environmental satellite series, and various military satellite programs, often experienced technical challenges, cost overruns, and schedule delays, Powner warned that must not be permitted in GOES-R.

“NOAA has established plans to address these lessons by conducting independent cost estimates, performing preliminary studies of key technologies, placing resident government offices at key contractor locations, and establishing a senior executive oversight committee,” Powner noted approvingly.

But that may not suffice.

“Many steps remain to fully address these lessons,” Powner concluded, and until NOAA completes those steps, GOES-R rmains at risk of further cost overruns plus more delays and performance shortfalls.

His full testimony that is entitled “Geostationary Operational Environmental Satellites: Additional Action Needed to Incorporate Lessons Learned from Other Satellite Programs” can be viewed at http://www.gao.gov on the Web with the number GAO 06-1129T.