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Space Transportation: NASA Has No Firm Need for Increasingly Costly Orbital Maneuvering Vehicle

Published by the Government Accountability Office on 1990-07-31.

Below is a raw (and likely hideous) rendition of the original report. (PDF)

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                          SPACE
                          TRANSPORTATION.                      ’
                          NASA Has No Firm
                          Need for Increasingly
                          Costly Orbital
                          Maneuvering Vehicle

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National Security and
International Affair6 JMviaion

B-239670
   July 31,lQQo

The Honorable Robert A. Roe
Chairman, Committee on Science,
  Space,and Technology
Houseof Representatives
Dear Mr. Chairman:

As you requested, we have reviewed the National Aeronautics and SpaceAdministration’s
(NASA) Orbital Maneuvering Vehicle (OMV) program. Specifically, we evaluated the need to
continue the OMVprogram in light of reductions in its capabilities and the reasonsfor changes
in OMVprogram costs and schedules.
We are sending copies of this report to the Administrator of NASA and appropriate
congressionalcommittees. Copieswill be made available to other interested parties upon
request.
This report was prepared under the direction of Mr. Mark E. Gebicke,Director, NASA Issues,
who may be reached on (202) 276-6140if you or your staff have any questions concerning
the report. Major contributors to the report are listed in appendix I.

Sincerely yours,




Frank C. Conahan
Assistant Comptroller General
                                                                                                   .
l3xecutiveSummary


                   The Orbital Maneuvering Vehicle (OMV) was conceived in 1986 as a
Purpose
                   $406 million multipurpose space tug. However, the estimated cost of the
                   program has grown to $736.6 million. In late 1989, the National Aero-
                   nautics and Space Administration (NASA) reduced or eliminated some of
                   the OMV'S planned capabilities to contain growing program costs.

                   The Chairman, House Committee on Science, Space, and Technology,
                   asked GAO to determine (1) whether NASA had established a firm need for
                   the OMV and (2) why the program costs have grown so much.


                   The OMV program was initiated as a way of extending the practical reach
Background         of the space shuttle. It was to transport satellites from the shuttle to
                   other orbits, reboost them when their orbits decayed, retrieve and
                   return them to the shuttle when they malfunctioned, and control their
                   reentry into the atmosphere when their useful lives expired. Subsequent
                   OMV enhancements would enable it to refuel satellites in orbit, perform
                   in-orbit satellite repairs, and rescue out-of-control satellites. The OMV
                   was to operate initially from the shuttle’s cargo bay but would ulti-
                   mately operate from the Space Station Freedom.

                   OMV  was designed to be a free-flying, remotely controlled propulsion
                   stage about 15 feet in diameter and 6 feet thick that would be carried
                   into orbit inside the shuttle’s cargo bay. Once separated from the
                   shuttle, the OMV would be remotely controlled by astronauts working at
                   consoles on earth.

                   The OMV'S detailed design and development phase began in fiscal year
                   1986. The cost-plus-award-fee contract provides for the design, develop-
                   ment, test, verification, and delivery of one OMV flight vehicle and asso-
                   ciated support equipment.


                   A firm requirement for the OMV does not exist. NASA can accomplish the
Results in Brief   OMV'S scheduled missions of reboosting the Hubble Space Telescope and
                   deploying and reboosting the Advanced X-ray Astrophysics Facility in
                   other ways that cost less. Other potential missions may or may not
                   materialize, but the OMV would have to be significantly enhanced before
                   NASA could use it on most of these other missions,


                   Since the OMV'S design and development phase began in 1986, estimated
                   OMV program costs have increased by 82 percent, even though the



                   Page 2                        GAO/NSIAD99-192   NASA’s Orbital   Maneuvering   Vehicle
                         vehicle’s capabilities have significantly decreased. The increase is attrib-
                         utable to (1) schedule stretchouts caused by internal NASA budget reduc-
                         tions, (2) program changes, and (3) contract cost growth. Further cost
                         increases appear likely, especially if NASA is to make maximum use of
                         the OMV.



Principal Findings

OMV Is Not Needed for    In late 1989, NASA reduced or eliminated a number of planned OMV per-
Scheduled Missions       formance capabilities. The OMV is now being designed principally to
                         reboost the Hubble Space Telescope and deploy and reboost the
                         Advanced X-ray Astrophysics Facility. Several NASA studies show, how-
                         ever, that the shuttle can perform these missions without the OMV.

                         A recent performance assessment shows that the OMV will not be needed
                         to deploy the Advanced X-ray Astrophysics Facility if advanced solid
                         rocket motors are available on the shuttle. According to the assessment,
                         the shuttle with these motors will be able to deliver this observatory to
                         its desired orbital altitude without the OMV. The first shuttle flight using
                         the advanced motors is scheduled for late 1995-well before the obser-
                         vatory’s April 1997 deployment schedule.

                         Other NASA studies show that the shuttle can maintain the Hubble and
                         the X-ray observatories at acceptable altitudes by reboosting them
                         during regularly scheduled maintenance flights. One or two additional
                         shuttle flights dedicated to reboosting the observatories could be
                         required early in the next century if the OMV is not developed.

                         The cost of the two additional shuttle flights to reboost the observato-
                         ries would be about $277 million. The cost of continued development
                         and operation of the OMV for the two missions would be about $716 mil-
                         lion-more than two and one-half times the cost of the shuttle flights.


Future Mission for the   Program officials have identified other, longer-term missions that they
OMV Uncertain            believe the OMV could enhance. For example, an OMV-type vehicle may be
                         needed to help maneuver materials in space if NASA undertakes staffed
                         missions to the moon or to Mars. However, these missions have not yet
              d
                         been approved, and NASA has not decided what equipment would be
                         needed to perform them. If these missions are approved and the OMV is


                         Page 3                        GAO/NSLAD-90-192   NASA’s Orbital   Maneuvering   Vehicle
                           Executive   Summary




                           used, capabilities that were removed from the design in 1989 would
                           have to be restored. These capabilities include the addition of advanced
                           solar arrays to allow for basing at Space Station Freedom.


Estimated Costs Continue   Since the design and development phase began in fiscal year 1986, esti-
to Increase                mated OMV program costs have incurred a net increase of $331.6 mil-
                           lion-from $406.0 million to $736.6 million. Schedule stretchouts caused
                           $266.1 million of the increase. Program changes such as shifting respon-
                           sibility for OMV operations from Marshall Space Flight Center to the
                           Johnson Space Center added another $106,9 million. The remaining
                           $123.1 million of the increase was attributed to contract cost growth.
                           NASA reduced the program estimate by $163.6 million by eliminating
                           some of the OMV'S capabilities and reducing cost reserves. NASA requested
                           $86.4 million in its fiscal year 1991 budget.

                           The same factors that caused earlier cost increases could cause future
                           increases. According to the Associate Administrator for Space Flight,
                           the OMV program is not immune to future budget cuts, which could cause
                           additional schedule delays and cost increases, Also, program changes
                           are to be expected as a result of the critical design review scheduled for
                           April 1991 and subsequent hardware fabrication and testing. NASA is
                           also concerned about additional contract cost growth. A number of the
                           subcontracts have not yet been awarded, and firm prices have not been
                           negotiated for other subcontracts. The current estimate includes a cost
                           reserve to cover future changes, but the reserve is about half the
                           amount NASA normally includes in cost estimates of programs at this
                           stage of development.

                           OMV  acquisition costs could increase to a cumulative total of $1.3 billion
                           if NASA decided to use the vehicle for other missions, which would
                           involve (1) restoring capabilities eliminated in the 1989 restructuring,
                           (2) purchasing a second vehicle, (3) making the two OMVS compatible
                           with expendable launch vehicles, and (4) purchasing an initial contin-
                           gent of spare parts. However, NASA considered it unlikely that it would
                           do all of these things.


                           Continued development of the OMV is not the most cost-effective
Recommendation and         approach to accomplishing currently scheduled missions and future mis-
Agency Action
          J
                           sion requirements are uncertain. In its draft report GAO therefore recom-
                           mended that the NASA Administrator terminate the OMV program. NASA
                           terminated the OMV program 6 days after receiving GAO'S draft report,


                           Page4                          GAO/NSIAD-90.192NASA'sOrbitdManeuverhgVehicle
                                           Executive       Summary




                                           citing budget pressures and the absence of a firm, near-term require-
                                           ment for the vehicle.


                                           The Congress should deny the $86.4 million requested for OMV develop-
Matter for                                 ment in fiscal year 1991, less any amount needed for termination
Congressional                              expenses. According to a preliminary NASA estimate, about $33.2 million
                                           of fiscal year 1991 funding will be needed for termination.
Consideration

                                           GAO       incorporated               NASA's        comments into this report where appropriate.
Agency Comments




                                           Page 5                                                GAO/NSIAD-90-192   NASA’s Orbital   Maneuvering   Vehicle




                              _   ____..     .   _   ,..     ._,   ,.   ,_,,,    .,   _   ,                .I..
                _   _.   ._
                                                                                                  .



Contentis


Executive Summary
Chapter 1                                                                                                   8
Introduction          Program History
                      Program Costs
                                                                                                           10
                                                                                                           11
                      Program Management                                                                   11
                      Objectives, Scope, and Methodology                                                   12

Chapter 2                                                                                                  13
NASA Has Not          Program Restructuring Reduced OMV’s Capabilities
                      OMV Not Needed for Scheduled Missions
                                                                                                           13
                                                                                                           16
Established a Firm    Future Mission Requirements Are Uncertain                                            19
Need for the OMV
Chapter 3                                                                                                  21
Estimated OMV Costs   Program Costs Have Grown Substantially                                               21
                      Further Cost Increases Are Likely                                                    23
Have Continued to     OMV Operational Costs                                                                26
Increase
Chapter 4                                                                                                  27
Conclusions,          Conclusions
                      Recommendation and Agency Action
                                                                                                           27
                                                                                                           27
Recommendation,       Matter for Congressional Consideration                                               28
Matter for            Agency Comments                                                                      28
Congressional
Consideration, and
Agency Comments
Appendix              Appendix I: Major Contributors to This Report                                        30

Tables                Table 2.1: Status of Major OMV Performance                                           14
                          Requirements
                      Table 2.2: Costs of Options for Reboosting HST and AXAF                              18
                          Observatories
                      Table 3.1: Changes in OMV Cost Estimates                                             21
                      Table 3.2: Potential Additional OMV Acquisition Costs                                26




                      Page 6                       GAO/NSIALMO-192   NASA’s Orbital   Maneuver&       Vehicle
IFigures   Figure 1.1: Orbital Maneuvering Vehicle                                                9




           Abbreviations

           AXAF      Advanced X-ray Astrophysics Facility
           GAO       General Accounting Office
           HST       Hubble Space Telescope
           NASA      National Aeronautics and Space Administration
           OMV       Orbital Maneuvering Vehicle


           Page 7                       GAO/NSIAD9&192   NASA’s Orbital   Maneuvering   Vehicle
    Chapter 1

    Irdmduction


                  The National Aeronautics and Space Administration (NASA) is developing
                  the Orbital Maneuvering Vehicle (OMV) to supplement the space shuttle’s
                  capability to deliver, retrieve, and service satellites, The OMVis to pro-
                  vide the capability to transport satellites to and from the shuttle’s cargo
                  bay and other orbital altitudes and inclination9 and to reboost the satel-
                  lites when their altitudes decay. Other capabilities are to include
                  viewing satellites to help diagnose their condition and controlling the
                  reentry of satellites into the earth’s atmosphere when their useful lives
                  expire.




                  ‘Orbital altitude is a satellite’s height abovethe earth. Inclination is the angleof the satellite’sorbit
                  relative to the earth’s equator.



                  Page 9                                     GAO/NSIAD-99-192       NASA’s Orbital    Maneuvering    Vehicle




.     . .-- .
             chapter 1
             Introduction




Figure




             The OMV is to be a remotely controlled, free-flying vehicle. It will be
         *   about 16 feet in diameter and 6 feet thick and will weigh 19,200 pounds
             with a full load of fuel.


             Page 9                       GAO/NSIAJJ-90-192   NASA’s Orbital   Maueuveriug   Vehicle
                  chnptmr
                  Introduction




                  The OMV is to have three propulsion systems: a main propulsion system
                  to provide the vehicle’s primary thrust, a reaction control system to pro-
                  vide the control needed to maneuver and guide the vehicle, and a cold
                  gas system to propel the vehicle when it is operating close to satellites
                  that are very sensitive to contamination. The OMV will have its own
                  thermal, electrical, guidance, navigation, control, data management, and
                  communications subsystems. The OMV is designed to be carried to orbit
                  inside the shuttle’s cargo bay. Onceseparated from the shuttle, it will be
                  remotely controlled by astronauts working at consoles on earth.

                  In a typical satellite reboost mission, the OMV will first be removed from
                  the cargo bay by the shuttle’s remote manipulator arm. After the shuttle
                  moves a safe distance from the OMV, the ground-based OMV operators will
                  remotely ignite the vehicle’s propulsion system and provide the com-
                  mands needed to guide it to the general area of its target satellite. Upon
                  arrival at the approximate rendezvous area-about 3 miles behind and
                   1 mile below the target-the OMV’S on-board radar will seek the precise
                  satellite location. When the OMV is about 1,000 feet from its target, a
                  television camera and floodlights aboard the vehicle will be switched on,
                  and the earth-baaed operators will begin a slow docking maneuver. Just
                  before docking, the relative speed between the vehicle and its target sat-
                  ellite will be extremely slow-perhaps      only an inch or less per second.
                  Once docking is accomplished, the operators can guide the OMV and the
                  satellite to its destination and then return the OMV to the shuttle.

                  After each mission, the shuttle will return the OMV to earth, where it will
                  be refurbished and stored for use on future flights. With refurbishment,
                  the OMV is expected to last 10 years.


                  The OMV'S conceptual design has evolved over a number of years. NASA
Program History   planned to use its predecessor, the Teleoperator Retrieval System, to
                  reboost Skylab to a safe orbit, but it terminated the program in 1978
                  when Skylab reentered the earth’s atmosphere earlier than expected.
                  NASA then redefined the concept to make the vehicle more versatile.
                  From 1983 through 1985, NASA and three contractors conducted studies
                  and analyses to define a preliminary design for the OMV.

                  The detailed design and development phase began in November 1986
                  when NASA selected TRW, Incorporated, as the OMV prime development
                  contractor. The cost-plus-award-fee contract with TRW provides for the
                  design, development, test, verification, and delivery of one OMV flight



                  Page 10                       GAO/NSIAJHO-192   NASA’s Orbital   Maneuvering   Vehicle
                     Chapter   1




                     vehicle and associated support equipment. It also includes mission sup-
                     port for the OMV’S development test flight and refurbishment of the
                     vehicle following that flight. The contract contains options for produc-
                     tion of a second OMV flight vehicle and mission support for up to nine
                     additional OMV flights.

                     In mid-1989, TRW notified NASA that it anticipated overrunning negoti-
                     ated contract costs. Following the disclosure, NASA decided to restructure
                     the program. Both TRW and NASA strengthened program management
                     and reduced the scope of the development contract to lessen cost and
                     technical risks. The scope reductions simplified the vehicle’s design but
                     also reduced its planned capabilities. In addition, NASA and TRW agreed
                     in principle to change the contract fee structure. The contract originally
                     provided for a base fee and a variable award fee determined by NASA'S
                     periodic evaluations of TRW’s contract performance. The parties had
                     agreed to eliminate the base fee and make all future fee payments con-
                     tingent on NASA's periodic award fee evaluations. The conversion of the
                     contract to an all award-fee contract was never officially finalized.

                     NASA also decided to revise the program schedule, stretching the devel-
                     opment program out by 18 months because of fiscal year 1990 and 1991
                     funding limits. The OMV’S first launch, originally planned for April 1990,
                     was scheduled for April 1995.


                          estimated that OMV development would cost $736.6 million,
Program Costs        NASA
                     Through fiscal year 1990, the Congress has appropriated $246.6 million.
                     NASA requested another $86.4 million for OMV in its fiscal year 1991
                     budget.


                     The OMV is being developed under NASA's Office of Space Flight. The
Program Management   Marshall Space Flight Center, NASA'S lead center, is responsible for total
                     OMV program management. Marshall is also responsible for the design,
                     development, test, and evaluation of the OMV flight vehicle and its
                     ground support equipment, airborne support equipment, payload accom-
                     modations equipment, and ground control console. The Johnson Space
                     Center is responsible for activities associated with integrating the OMV
                     and its payloads into the space shuttle and for OMV flight operations.
                     The Kennedy Space Center is responsible for launch and landing
                     activities.




                     Page 11                       GAO/NSLUWJ-192   NASA’s Orbital   Maneuvering   Vehicle
                        Chapter 1
                        Introduction




                        We reviewed the OMVprogram at the request of the Chairman, House
Objectives, Scope,and   Committee on Science, Space, and Technology. Our objectives were to
Methodology             determine (1) whether NASA had established a firm need for the OMVand
                        (2) why the program’s costs had increased.

                        To determine if NASA had established a firm need for the OMV,we
                        reviewed NASA studies, reports, and briefings that addressed uses for
                        and alternatives to the OMV.We discussed potential uses and benefits of
                        the vehicle with OMVprogram officials at NASA Headquarters, Marshall
                        Space Flight Center, Johnson Space Center, and TRW. We also inter-
                        viewed managers of NASAand Department of Defense programs identi-
                        fied as potential OMVusers to determine their requirements for the
                        vehicle and other alternatives for accomplishing the missions. These
                        included officials of the Hubble Space Telescope, Advanced X-ray Astro-
                        physics Facility, Gamma Ray Observatory, Satellite Servicing System,
                        Space Station Freedom, Earth Observing System, Waves in Space
                        Plasma, Mars/Lunar Initiative, Shuttle-C, and Survivable Power Sub-
                        system programs.

                        To determine the reasons for program cost growth, we reviewed internal
                        NASAprogram, contract, and budget documents and contractor cost
                        reports. We also discussed the reasons for cost growth with NASAand
                        TRW program officials.

                        We reviewed the OMVprogram from August 1989 through April 1990 in
                        accordance with generally accepted government auditing standards.




                        Page 12                      GAO/NSIAD-90-192   NASA’s Orbital   Maneuvering   Vehicle
Chap&- 2

N& Has Not Establisheda F’irm Need for
the OMV

                        NASA does not need the OMV to accomplish the primary missions for
                        which it was designed. In late 1989, NASA reduced or eliminated a
                        number of the vehicle’s planned capabilities to contain growing costs.
                        The designated missions of the OMV were to reboost the Hubble Space
                        Telescope (HST) and deploy and reboost the Advanced X-ray Astro-
                        physics Facility (AXAF). NASA can accomplish these missions with the
                        shuttle at less cost than the continued development and operation of the
                        OMV. Furthermore, requirements for other potential missions using the
                        OMV are uncertain, and most of these missions cannot be completed with
                        the currently configured OMV.


                        As originally conceived, the OMV was to be used as a multipurpose space
Program Restructuring   tug for a number of satellites. It was to transport payloads or satellites
ReducedOMV’s            to and from the shuttle or space station and other orbits, reboost them
Capabilities            when their orbits decayed, retrieve and return them when they malfunc-
                        tioned, examine payloads to help determine whether and why they mal-
                        functioned, and control their reentry into the atmosphere when their
                        useful lives expired. In 1989 NASA restructured the program to contain
                        escalating costs. Many of the OMV'S planned capabilities were reduced or
                        eliminated in the restructuring. NASA was designing the OMV in such a
                        way that these capabilities could be restored later, if needed. Table 2.1
                        shows the major OMV performance characteristics and the effects of the
                        restructuring.




                        Page 12                       GAO/NSIAD@O-192   NASA’s Orbital   Maneuvering   Vehicle
                                 chapter 2
                                 NASA Iiae Not Established      a Nrm Need for
                                 the OMV




Table 2.1: Status of Major OMV
Performance Requirements         Performance requirement                                    Eliminated           Reduced        Unchanged
                                 Miarlonr
                                   Deliver payloads
                                   Retrieve payloads
                                   Reboost payloads
                                   Deboost payloadsa
                                   View payloadsb                                                                          X
                                 OMV Basing and Control
                                   Shuttle based                                                                                                   X
                                   Space station based                                                  X
                                   Space basedC                                                         X
                                   Ground controlled                                                                                               X
                                   Station controlled                                                   X
                                   Automatic navigation to payloads                                     X
                                   Manned control during final docking                                                                             X
                                 OMV Operations
                                   Cold gas propulsiond                                                                                            X
                                   Low “G” trajectorye                                                                                             X
                                   Contingency return of payloads                                       X
                                   Accommodation of various enhancements                                                   X
                                 Payload Accommodations
                                   Provide limited resources to payloads                                X
                                   Spoint docking system                                                                                           X
                                   1-point docking system                                               X
                                 OMV Maintenance
                                   On-orbit maintenance                                                 X
                                   lo-vear refurbishment                                                                                           X
                                 %eboost    - controlling the angle and location at which a satellite reenters the Earth’s atmosphere.
                                 bViewing   flying around satellites to examine them for possible malfunctions

                                 QMV was to have been capable of parking in orbit for up to 9 months between missions.

                                 dCold gas propulsion is needed to avoid contaminating     some payloads, such as the Hubble Space
                                 Telescope.

                                 *Low “G” trajectory means very low acceleration


                                 Scaling down the OMV’S capabilities limited the missions it would be able
                                 to accomplish. Because of changes in its propulsion, electrical power,
                                 and guidance systems, the OMV would not be able to deliver, retrieve, or
                                 reboost payloads as far as originally planned. It would not be able to
                                 deboost as large a payload as originally planned.




                                 Page 14                                     GAO/NSIAD-W-192        NASA’s Orbital    Maneuvering        Vehicle
chapter 2
NASA Ham Not Ekablished    a F’im~ Need for
the OMV




The reductions were most dramatic in the delivery and deboost mis-
sions. For example, the distance the OMV could transport a 3,500-pound
satellite in an initial delivery mission was reduced by 60 percent.1

The shuttle alone can deliver large payloads into space more efficiently,
according to a recent assessment by the Johnson Space Center. This
study showed that the shuttle can deliver payloads weighing more than
9,000 pounds to higher orbits than the shuttle-oMv combination could
deliver them. With the combined weight of a payload and the
 19,200-pound OMV, the shuttle’s initial orbiting altitude will be lower,
and the reduced-capability OMV would not be able to make up for the
lower shuttle altitude.

Also, the reduced-capability OMV would not be able to control the reentry
of large payloads, whose fall to earth may present a safety hazard. The
full-capability OMV was expected to be able to deboost payloads
weighing up to 75,000 pounds; the reduced-capability OMV would not be
able to deboost payloads weighing more than 15,000 pounds. NASA cur-
rently has no requirement to deboost payloads weighing less than
16,000 pounds, since objects of this size and smaller normally burn up
during reentry into the Earth’s atmosphere, according to the NASA head-
quarters OMV Program Manager.

NASA would not be able to base the reduced-capability                 OMV at Space Sta-
tion Freedom and control it from that location or to leave the vehicle in
space between missions. Therefore, the OMV would have to be trans-
ported to and from each mission on the shuttle.

The reduced-capability OMV would not be able to automatically navigate
to its payload as was originally planned. Ground controllers would have
to guide it during the entire flight sequence. As a result, the time needed
to track a target payload increased from 6 minutes to about 3 hours.
Two additional ground-based flight controllers would be needed to gen-
erate data for the tracking,

The reduced-capability vehicle would not be able                to provide resources
such as communications or power to its payloads                 except for rare
instances when payloads would be hard-wired to                  the OMV. Also, one of
two planned docking mechanisms was eliminated                   from the vehicle


‘The reduction was from 340 nautical milesto 136nautical miles,assuminga l-degreechangein the
satellite’sorbital inclination.



Page 16                               GAO/NSIAD-99-192   NASA’s Orbital   Maneuvering   Vehicle
                           Chapter   2
                           NASA Has Not Established   a Firm Need for
                           the OMV




                           design during the restructuring. As a result, the OMV would not be com-
                           patible with some payloads that might be carried on the shuttle.

                           Originally, the OMV was to have been repaired while in orbit by astro-
                           nauts who would have worked from Space Station Freedom to remove
                           and replace groups of components called “orbital replacement units.”
                           The reduced-capability OMV would not have orbital replacement units. If
                           it malfunctioned while in space, it would have to be returned to earth
                           for repairs.

                           According to NASA officials, the OMV was designed so that capabilities
                           eliminated in the restructuring could be restored to the vehicle if they
                           were needed, Space would be reserved in the vehicle to restore the capa-
                           bilities, and any needed couplings would be built.


                           The reduced-capability OMV is being designed primarily to deploy the
OMV Not Needed for         AXAF  and reboost the AXAF and HST as their orbits decay. Recent NASA
Scheduled Missions         studies show, however, that the vehicle is not needed to perform these
                           missions. The cost of using only the shuttle for these missions is lower
                           than the cost of continued development and operation of the OMV.


Shuttle Can Deliver AXAF   Under NASA's current schedule, the shuttle will be able to deploy the
Without OMV                AXAF  observatory without OMV'S assistance. Advanced solid rocket
                           motors needed for the shuttle to deliver the AXAF to its required altitude
                           are scheduled to be available more than a year before the planned 1997
                           launching of the observatory.

                           To avoid having to reboost the AXAF for at least 6 years, NASA would like
                           to deliver it to an initial orbital altitude of 320 nautical miles. Altitudes
                           of large satellites in low earth orbit decay over time due to drag, which
                           is influenced by activity on the sun. The observatories’ abilities to col-
                           lect scientific data could be adversely affected if their orbits are allowed
                           to get too low, especially during periods of high solar activity. As a
                           result, NASA expects that the observatories may have to be reboosted to
                           higher orbits from time to time. However, at an initial altitude of
                           320 nautical miles, NASA estimates that it should not be necessary to
                           reboost the AXAF during its first 6 years on orbit.

                           NASA  officials once believed that the OMV was needed to get the AXAF to
                           an altitude of 320 nautical miles. With its current solid rocket motors,
                           the shuttle will not be able to deliver the 32,800-pound AXAF to an


                           Page 16                               GAO/NSIAD90-192   NASA’s Orbital   Maneuvering   Vehicle
                         NASA Haa Not Eetablished   a Firm Need for
                         the OMV




                         orbital altitude higher than about 270 nautical miles. A February 1990
                         performance assessment by the Johnson Space Center showed, however,
                         that the shuttle cannot carry both the AXAF and OMVinto orbit on the
                         same flight. The assessment also showed that with the advanced solid
                         rocket motors, expected to be available in December 1996, the shuttle
                         can carry AXAF to an initial orbit of 320 nautical miles without the OMV.
                         The OMVwill not be needed for AXAF deployment if the shuttle’s
                         advanced solid rocket motors are available as scheduled.

                         If NASAcannot maintain the schedule for the advanced solid rocket
                         motors and they are not available when AXAF must be launched, NASA
                         could launch the observatory on a shuttle with currently designed
                         motors and boost it to a higher orbit later. Either the shuttle or the OMV
                         could provide the boost. Without the OMV,two shuttle flights would be
                         needed to boost AXAF to its desired altitude of 320 nautical miles; with
                         the OMV,only one flight would be needed. If the OMVwere used, it could
                         be carried into space prior to the AXAF being launched, or the OMVcould
                         be launched after the AXAF deployment to boost the observatory to its
                         desired orbit. However, the OMV'Scurrent design would have to be modi-
                         fied to allow it to remain in space for several months.


Shuttle Can Reboost      Recent NASA studies show that the shuttle can reboost the HSTand AXAF
Observatories at Lower   observatories without the OMV.By reboosting the observatories a little
                         during each scheduled maintenance visit, only one or two shuttle flights
cost
                         dedicated to reboosting the observatories should be required to keep
                         them at sufficiently high altitudes even under worst-case conditions,
                         according to the studies. The two dedicated shuttle flights would be less
                         costly than continued OMVdevelopment and operation.

                         NASA plans for the shuttle to revisit HSTand AXAF periodically to main-
                         tain them and to replace their scientific instruments. Current plans are
                         to revisit the HSTevery 3 years for maintenance and every 6 years for
                         instrument replacement. One new scientific instrument is already under
                         development and should be available for incorporation into the HSTin
                         1996. AXAF is to be revisited every 6 years for servicing and
                         refurbishment.

                         Two space studies show that the shuttle will be able to keep the obser-
                         vatories at acceptable altitudes even without the OMV.According to a
                         September 1989 Johnson Space Center study, the shuttle can reboost the
                         HSTa little on each scheduled maintenance mission and keep it at a suffi-
                         ciently high altitude through the turn of the century. If solar activity is


                         Page 17                               GAO/NSIAD-90492   NASA’s Orbital   Maneuvering   Vehicle
                                  chapter2
                                  NASA Has Not Established       a Firm Need for
                                  the OMV




                                  especially high near the turn of the century, one additional flight might
                                  be needed to reboost HSTto a sufficiently high altitude. However,
                                  according to the study, the telescope will not have to be reboosted if
                                  solar activity is at an average level.

                                  In a similar study completed in March 1990, NASA'S Office of Space
                                  Flight concluded that one or two additional shuttle flights might be
                                  required early in the next century to reboost the observatories without
                                  the OMV.One flight dedicated to reboosting AXAF would be needed in
                                  2000 and one flight dedicated to reboosting HSTwould be needed in
                                  2001. All other reboost requirements could be accomplished during
                                  planned maintenance and refurbishment missions.

                                  These two shuttle flights are a less costly way of reboosting the observa-
                                  tories than continued development and operation of the OMV.The mar-
                                  ginal costs of two shuttle flights in fiscal years 2000 and 2001 together
                                  with the cost of terminating the OMVprogram would be about $277 mil-
                                  lion The cost of completing the OMVdevelopment, conducting the devel-
                                  opment test flight, storing the vehicle at Kennedy, and operating it for
                                  the two flights would cost over two and one-half times that amount-an
                                  estimated $716 million. The two estimates are shown in table 2.2.

Table 2.2: Costs of Options for
Aoboorting HST and AUF            Dollars in millions
Observatorler                     Cost category                                                      Shuttle only         Shuttle with OMV
                                  Complete OMV developmant                                                            a             $529.50b
                                  OMV termination cost                                                       $79.40
                                  Shuttle flight for OMV development test (1995)”                                     a                77.50
                                  OMV storage (1996-99)         ’                                                     a                17.60
                                  Shuttle fliaht to reboost AXAF (2OOOY                                       96.60                            a
                                  OMV flight to reboost AXAF ’         ’                                              a                44.88
                                  Shuttle flight to reboost HST (2001)                                       100.95                            a
                                  OMV flight to reboost HST                                                           a                46.90
                                  Total                                                                   $276.95                   $716.38
                                  ‘Not applicable
                                  bThe current cost estimate to complete OMV development is $736.5 million less costs expected to be
                                  incurred through June 30, 1990, ($207 million).
                                  ‘The shuttle flight costs are the marginal cost of a 1995 flight, the last year for which NASA has pro-
                                  jected shuttle flight costs, Marginal costs are the incremental costs for adding one additional shuttle
                                  flight in each of the years. These costs do not include fixed costs associated with shuttle flights, which
                                  NASA will incur whether or not additional flights are undertaken.




                                  Page 18                                    GAO/NSIAWO-192         NASA’s Orbital    Maneuvering    Vehicle
                   Chapter2
                   NASA Hae Not Eetnbliahed   a Finn Ned     for
                   the OMV




                   According to NASA'S Office of Space Flight, the OMVis needed not only for
Future Mission     delivery and reboost of HSTand A&IF but also as a part of the nation’s
Requirements Are   overall space transportation infrastructure. However, NASA has not yet
Uncertain          decided to undertake any of the missions it has identified as potential
                   applications for the OMV. Furthermore, the currently configured OMV
                   would not be able to perform the missions even if they were approved.
                   The potential missions include (1) carrying supplies and materials from
                   expendable launch vehicles to Space Station Freedom, (2) serving as the
                   propulsion module for the station’s assured crew return vehicle,
                   (3) transporting equipment and supplies from expendable launch vehi-
                   cles to the station’s Polar Orbiting Platform, (4) transporting automated
                   satellite servicing equipment, and (6) providing a contingency capability
                   in the event of another shuttle accident.

                   Using expendable launch vehicles with the OMVto resupply Space Sta-
                   tion Freedom would reduce requirements for the space shuttle,
                   according to officials of NASA’s Unmanned Launch Vehicles and Upper
                   Stages Branch of the Office of Space Flight. The OMVcould be used to
                   transfer the supplies from the expendable launch vehicles, which would
                   be parked 20 nautical miles away, to the station. Similarly, the OMV
                   could be used to transfer to and from the station materials needed for
                   any manned missions to the moon and Mars. According to NASA, the OMV
                   would have to be modified so that it could be based either at the station
                   or in space, and the amount of propellant it could carry would have to
                   be increased to accomplish these missions. Neither of the missions has
                   been approved. NASA currently plans to use the manned shuttle to
                   resupply all of the station’s needs. No decision has been made on ways
                   to accomplish any manned missions to the moon and Mars. Also, NASA
                   may have alternatives to using the OMVfor these missions. At least one
                   firm is interested in providing commercial launch services for station
                   resupply. This firm maintains that it could deliver the supplies and
                   materials to the station.

                   The OMVdevelopment contractor has proposed using the OMVto return a
                   crew from Space Station Freedom to Earth in an emergency. Hovever,
                   the OMV'Sdesign would have to be modified to permit the vehicle to be
                   based at Freedom and to increase its propulsion capabilities. NASA is cur-
                   rently studying various ways of returning crews from Freedom but does
                   not plan to select a crew return vehicle design until 1994.

                   According to OMVprogram officials, the OMVcould be used with expend-
                   able launch vehicles to resupply the polar orbiting platform, which is
                   planned as part of NASA's Earth Observing System. However, according


                   Page 19                                 GAO/NSIAB9O-192   NASA’s Orbital   Maneuvering   Vehicle
Chapter 2
NASA HM Not Ertabllshed   a Firm Need for
the OMV




to a program official, it would not be cost-effective to design the polar
orbiting platform so that it could be resupplied. Even if NASAlater
decided to include the capability to resupply the polar orbiting platform
in its design, the currently configured OMVcould not be used in the
resupply operation. The OMVwould have to be modified to make it com-
patible with expendable launch vehicles and enable it to be based in
space or at the platform. Also, another OMVwould have to be purchased
for this mission, since the space shuttle cannot go to polar orbit, and the
OMVcould therefore not be retrieved from the platform.

The OMV might also be used to transport automated satellite servicing
equipment if development of that equipment is approved. NASA is cur-
rently studying designs that would enable it to maintain satellites in
orbit by robotically replacing component modules and refueling the
satellites. If developed, the satellite servicing system could be attached
to the OMV.However this system is not expected to be available before
2000, potential servicing missions have not been defined, and robotically
serviceable satellites do not currently exist. Also, the OMV'Sdesign would
have to be modified to enable it to be used with the satellite servicing
system.

OMVprogram officials also have stated that the vehicle could be used if
the shuttle were to become incapacitated. For example, the OMVand
expendable launch vehicles could resupply the station if the shuttle
were not available for a long period. However, the OMVwould have to be
modified so that it could be launched on an expendable launch vehicle.




Page 20                              GAO/NSIAD-99-192   NASA’s Orbital   Maneuvering   Vehicle
Chapter 3

Estimated OMV CostsHave Continued
to Increase

                                 OMV's   estimated costs have substantially increased due to schedule
                                 stretch-outs, program content changes, and contract cost growth. Fur-
                                 ther increases are likely because the OMV is in an early stage of develop-
                                 ment, reserves to cover future program changes are less than NASA
                                 normally includes in its estimates, and system enhancements are needed
                                 for OMV to perform some of its potential missions. Program acquisition
                                 costs could also increase to about $1.3 billion if NASA restores the capa-
                                 bilities eliminated from the OMV’S design, purchases a second vehicle,
                                 makes the two vehicles compatible with expendable launch vehicles, and
                                 purchases an initial contingent of spare parts. NASA has not yet prepared
                                 a complete estimate of operational phase costs but has estimated the
                                 costs of certain specific missions.


                                 Since OMV development was approved in 1986, estimated program costs
Program Costs Have               have increased about 82 percent, from $406.0 million to $736.6 million.
Grown Substantially              At the same time, the vehicle’s capabilities have been significantly
                                 reduced. The program estimate would have been about $890.0 million if
                                 NASA had not reduced the estimate by about $164.0 million by elimi-
                                 nating some of the OMV'S capabilities and paring cost reserves. Table 3.1
                                 shows the cost changes.

Table 3.1: Changes in OMV Cost
Eatlmates                        Dollars in Millions
                                 Cost changes                                                                     Amount
                                 Increases
                                 Schedule stretch-outs                                                             $256.1
                                 Program changes                                                                    105.9
                                 Contract cost growth                                                               123.1
                                   Subtotal of increases                                                           $485.1

                                 Decreases
                                 Reduced technical capabilities                                                    -$81.5
                                 Reduced cost reserves                                                               - 72.1
                                   Subtotal of reductions                                                         - 153.6
                                   Net chanae                                                                     $331.5


                                 According to NASA, schedule stretch-outs resulting from internally
                                 imposed budget cuts are the primary cause of the cost increases to date.
                                 NASA has reduced the OMV budget in each of the last 4 years to fund
                                 higher priority programs. The budget reductions meant that work had to
                                 be postponed and the development program delayed. The stretch-outs



                                 Page 21                          GAO/NSIAIH&192   NASA’s Orbital   Maneuvering   Vehicle
Chapter 2
Estlmatid   OMV Costs Have Continued
to Increase




have added 6 years to the OMV'S development program. The schedule for
the vehicle’s first flight slipped from April 1990 to April 1996. Schedule
stretch-outs increased OMV costs over $266 million.

According to NASA and TRW officials, the primary lesson to be learned
from the OMV program is that a project started without a firm, near-term
requirement is likely to “become the bank” for programs with more
immediate funding needs. Because no other program is dependent on the
availability of OMV, NASA reduced its budget and stretched out develop-
ment to provide more funds for other, more urgently needed programs.

Program changes added about $106 million to estimated costs. A pri-
mary change was associated with moving responsibility for OMV opera-
tions from the Marshall Space Flight Center to the Johnson Space
Center. When the program was initially approved, the Marshall Space
Flight Center was assigned responsibility for both development and
operations. Soon after the contract was signed, however, NASA decided to
shift responsibility for OMV operations to the Johnson Space Center.
Officials at Johnson concluded that developing the hardware and
software for OMV operations and operator training would cost about
$69 million more than previously estimated. Various other program
changes added another $37 million to the estimate. These included, for
example, changes resulting from the vehicle’s preliminary design
review.

Contract cost growth accounts for an increase of over $123 million, of
which $76 million was for the prime contractor’s work and $48 million
was for estimated subcontract costs. According to the previous OMV Pro-
gram Manager, TRW’s original contract price of $212 million underesti-
mated OMV development costs. TRW agreed that its original contract
price was too low because it had made optimistic assumptions. For
example, TRW had assumed that it would not have to develop unique
components for the OMV but instead could use some off-the-shelf hard-
ware. TRW also believed that the frequency of OMV schedule changes
contributed to its inability to estimate prices.

The program cost estimate would have been even higher if it had not
been offset in part by contract scope reductions in 1989 and reductions
in cost reserves. The reductions in scope included simplifying the OMV'S
design and decreasing its planned capabilities. Spare parts and some
tests and documentation were also deleted. In addition, NASA also
reduced the amount of reserves contained in the estimate to absorb



Page 22                                GAO/NSIAD99-192   NASA’s Orbital   Maneuvering   Vehicle
                            Chapter 3
                            Estimated OMV Costa Have Continued
                            to Increaee




                            future cost increases. The estimate just prior to the program restruc-
                            turing contained reserves equal to about 34 percent of the future devel-
                            opment costs. Reserves in the current estimate are equal to about
                            16 percent of the remaining development costs.


                            OMVcosts will likely continue to rise, especially if NASAis to make max-
F’urther Cost Increases     imum use of the vehicle. The program is still in an early design phase,
Are Likely                  and reserves to cover future cost increases are significantly less than                          _.
                            NASAnormally includes in its program cost estimates. Further, to com-
                            plete some potential missions, NASAwould have to modify the OMVby
                            restoring some capabilities previously deleted and adding a new capa-
                            bility-delivery  of the OMVby expendable launch vehicles. NASAmay
                            also have to purchase an additional vehicle and the spare parts needed
                            for maintenance.


Adequacy of Cost Reserves   The OMVdevelopment program is less than half complete, and those
                            same factors that caused cost increases in the past could also cause
                            future cost increases. The $736.6 million estimate includes a $72.6 mil-
                            lion reserve to absorb future cost increases, but that amount is only
                            about half the amount NASA normally budgets for programs at this stage
                            in development, according to the Chief of the Cost and Economic
                            Analysis Branch, NASAComptroller.

                            The OMVprogram could experience more of the same type of budget cuts
                            that have already caused schedule stretch-outs and added $266.1 mil-
                            lion to the program’s cost. NASA’sAssociate Administrator for Space
                            Flight told the Subcommittee on Space Science and Applications, House
                            Committee on Science, Space, and Technology, in February 1990 that if
                            NASAhas to make budget cuts in fiscal year 1991, the “OMV would not be
                            immune to its fair share of the cuts.” In this regard, NASA’sfiscal year
                             1991 budget request of $16.1 billion represents a 23-percent increase
                            over fiscal year 1990, and the agency projects that its budget require-
                            ments will increase by another 17 percent in fiscal year 1992 and an
                            additional 10 percent in fiscal year 1993. With projected increases of
                            this magnitude, cuts in NASA’S budget requests are a distinct possibility
                            as Congress attempts to address the deficit and other pressing fiscal
                            issues over the next several years,

                            More design changes are also to be expected. The program’s critical
                            design review is not scheduled until April 199 1. Following the design
                            review, the contractor will begin hardware fabrication and testing.


                            Page 23                              GAO/NSIA.WKJ-192   NASA’s Orbital   Maneuvering   Vehicle
Chapter8
WlnWed      OMV Caeta Have Continued
to Increaee




Design changes are to be expected as a result of the design review and
fabrication and testing activities. According to the Chief of NASA's Cost
and Economic Analysis Branch, most cost increases occur during a pro-
gram’s hardware fabrication and testing phases. According to this offi-
cial, it is not unusual for development programs to take longer than
planned because of problems identified during testing of complex com-
ponents such as electronic assemblies1 Extending a program increases
its cost.

Other contract cost increases are also possible, particularly in subcon-
tracts. Subcontract costs in the $736.6 million estimate, are for the most
part not based on negotiated prices or firm proposals from the subcon-
tractors. Through February 1990, firm prices had been negotiated for
only about 66 percent of the subcontracts. Also, TRW did not have pro-
posals from subcontractors detailing the cost impact of the most recent
program stretch-out. According to Marshall’s Deputy OMV Project Man-
ager, NASA believes that the current estimate for subcontracts is ade-
quate, but it cannot be certain of that until firm proposals are received
and negotiated.

The $72.6 million cost reserve included in the estimate is less than half
the amount NASA normally includes in program estimates prior to critical
design review. The reserve, or allowance for program adjustment, is
intended to absorb cost increases that may occur in the future.
According to the Chief of NASA’s Cost and Economic Analysis Branch,
NASA would normally include in the estimate a cost reserve equal to
about 30 percent of future costs for such a complex program prior to its
critical design review. The OMV reserve is only about 16 percent of
future costs.

According to the Deputy OMV Project Manager, when NASA restructured
the development program in 1989, it reduced the OMV’s cost and tech-
nical risk, The Deputy Project Manager concluded that, in total, the cost
reserves would be adequate, but amounts available in fiscal years 1990
and 1991 would be marginal. If costs were to increase significantly in
these years, work would have to be deferred and the schedule might
have to be delayed again.




‘There is a 4-monthcushionbuilt into the OMVprogramto accommodate
                                                                schedulechangesduring the
fabrication and testing phase.



Page 24                                GAO/NSJAD-90-192   NASA’s Orbital   Maneuvering   Vehicle
                                        Chaptar 8
                                        Ibtlmated  OMV Costa Have C!ontinued
                                        tosncreaee




Future Program                          NASA is considering purchasing an additional vehicle, restoring capabili-
Enhancements                            ties, and modifying the OMVS to make them compatible with expendable
                                        launch vehicles. According to preliminary NASA estimates, these actions,
                    \                   together with an initial contingent of spare parts for the two vehicles
                                        and a spare propulsion module could add another $640.6 million to the
                                        OMV'sacquisition cost, raising the total for two OMVS to about $1.3 bil-
                                        lion. NASA considered that the additional costs, if required, would be a
                                        part of the vehicle’s operational, rather than the developmental pro-
                                        gram. Table 3.2 shows the potential additional acquisition costs.

Tablo 3.2: Potontlrl Addltlonrl   OMV
AcqulWon Corta                          Dollar5   in millions
                                        Cart Category                                                                             Cort
                                        Restored capabilities                                                                   $112.7
                                        Second OMV                                                                                303.8
                                        ExPendable launch vehicle comoatibilitv                                                    25.2
                                        Spare parts                                                                                69.3
                                        Spare propulsion module                                                                    29.6
                                        Total                                                                                   5540.6


                                        Modifying the OMV would cost about $112.7 million, according to a pre-
                                        liminary NASA estimate. This estimate assumes that the OMV would be
                                        modified to restore its full capabilities after NASA purchased a second
                                        OMV with full capabilities. Another $26.0 million would be needed to
                                        design, develop, and qualify the modifications if NASA did not purchase a
                                        second vehicle.

                                        NASA  estimated that a second, full capability OMV could be purchased for
                                        about $303.8 million if production of the vehicle were authorized for
                                        fiscal year 1993. The vehicle would be delivered in May 1998.

                                        Modifying the two OMVS to make them compatible with expendable
                                        launch vehicles such as the Titan IV would cost an estimated $26.2 mil-
                                        lion. Purchasing the initial contingent of spare parts and components
                                        needed to maintain the vehicles would cost another $69.3 million’
                                        between fiscal years 1993 and 1996. A spare propulsion module, which
                                        might be needed if the OMV were based at Space Station Freedom, would
                                        cost an estimated $29.6 million.

                                        NASA considers it unlikely that it would do all of these things. The
                                        agency described them as “an accumulation of various possible options




                                        Page 25                                GAO/NSIAMMl-192   NASA’s Orbital   Maneuveriug   Vehicle
                                                                                                                1
                  clubptewa
                  Eetlmati   OMV Coats Have Cbntintwd
                  to Imrease




                  that represent a worst case scenario that probably would never
                  materialize.”


                  Because of uncertainty about when and for what purposes the OMV
OMV Operational   would be used, NASAhas not prepared a comprehensive estimate of OMV
costs             operations costs. Instead, the agency estimated operation costs for two
                  alternative mission scenarios.

                  Both scenarios involve reboosting the HSTin mid-1996 and boosting the
                  AXAF to its desired altitude when it is deployed in 1997. In the first sce-
                  nario, the OMV would be carried into space and left there to await AXAF
                  deployment. In the second scenario, the AXAF would be launched first
                  and the OMVbrought up later to boost the observatory to its final alti-
                  tude. NASAestimated that the first scenario would cost about $90.1 mil-
                  lion, while the second would cost about $81.7 million. Both estimates
                  include costs to (1) store the OMVfollowing its 1995 test flight;
                  (2) remove the OMV from storage, prepare it for launch, and reboost the
                  HSTwith it in June 1996; (3) refurbish the OMVfollowing the HSTreboost;
                  (4) launch and operate the OMVto boost AXAF to its final destination in
                  1997; and (5) refurbish the OMVand place it in storage to await some
                  future mission. The primary difference between the two estimates is
                  that the first scenario includes the cost of adding gallium arsenide solar
                  arrays to equip the OMVfor space basing.

                  NASAalso estimated the annual recurring cost of storing the OMVbetween
                  missions and the operation cost for a typical reboost mission. Both of
                  these estimates are in constant fiscal year 1990 dollars, since it is not
                  known when the reboost mission would occur or how long the vehicle
                  would have to be stored between missions. NASAestimated that $3.2 mil-
                  lion a year would be needed to store the OMVand that an additional
                  $28.9 million would be needed for a typical reboost mission.2




                  ‘2OMV stmagemd operatkmeshown in table 2.2on page21 are basedon theseestimates,but the
                  amountsin the table include an allowancefor future inflation of 4.6 percenta year for eachyear
                  after 1990.



                  Page 26                                GAO/NSIAIHO-192     NASA’s Orbital   Maneuvering   Vehicle
Chapter 4

Conclusions,Recommendation,Matter for
CongressionalConsideration,and
Agency Comments
                     NASAhas not adequately justified or established a need for the OMV,The
Conclusions          vehicle’s two scheduled missions can be accomplished by other means
                     that cost less. Furthermore, although NASAhas identified other potential
                     missions for the vehicle, these missions have not been approved and no
                     requirements have yet been firmly established for them. Even if these
                     missions were approved, the OMVwould have to be modified, at addi-
                     tional cost, before it could be used for them.

                     Because NASAhas not had a firm need for the OMV,it has been a target
                     for budget cuts that have proved to be costly to the OMVprogram. Faced
                     with more pressing needs and not enough funds, NASAofficials have
                     reduced the program’s funding in each of the last 4 years to fund higher
                     priority programs that had firmer requirements. Most of the OMV’S cost
                     increase can be attributed to schedule delays.

                     Further cost increases are likely, especially if NASAis to make maximum
                     use of the vehicle. Schedule delays, program changes, and cost growth
                     have already caused development costs to nearly double. These same
                     factors could cause further increases, since it is still early in the OMV'S
                     development stage, and reserves to cover future cost increases are only
                     about half the amount NASAnormally budgets in cost estimates of sim-
                     ilar programs. Also, OMV program acquisition costs could increase to
                     $1.3 billion if NASAdecides to (1) restore all of the vehicle’s originally
                     planned capabilities, (2) purchase an additional vehicle, (3) make the
                     two vehicles compatible with expendable launch vehicles, and (4)
                     purchase an initial contingent of spare parts.

                     A primary lesson learned from the OMVprogram is that a development
                     program should not be started before a firm requirement is established.
                     Once started, the program should be funded so that it can be conducted
                     expeditiously and efficiently.


                     In our draft report we recommended that the Administrator terminate
Recommendation and   the OMVprogram. NASAestimated that it had already spent $199.4 mil-
Agency Action        lion on the program through June 6,1990, and that an additional $79.4
                     million1 would be required for termination. However, the remaining
                     $460.1 million cost to complete the development and any additional



                     ‘The $79.4million required for termination includes$46.2million in fiscal year 1990funds and
                     $33.2million in fiscal year 1991funds.



                     Page 27                                 GAO/NSIAD-90-192    NASA’s Orbital   Maneuvering   Vehicle
                  chapter 4
                  Conclruioru,  Reconunendation,     Matter   for
                  cOngreaaional  ~nsideration,     and
                  Agency Cemnwnta




                  costs for restoring capabilities eliminated in the 1989 restructuring, pro-
                  curing a second vehicle, and operating the vehicles would be avoided if
                  the program were terminated.

                  NASA terminated the OMV program and instructed TRW to cease all work
                  under the contract 6 days after receiving our draft report. The agency
                  cited budgetary pressures and the lack of a firm, near-term requirement
                  for the vehicle as reasons for the termination.


                  The Congress should deny the $86.4 million requested for OMV develop-
Matter for        ment in fiscal year 1991, less any amount needed for termination
Congressional     expenses. According to a preliminary NASA estimate, about $33.2 million
Co&deration       of fiscal year 1991 funding will be needed for termination.


                  We incorporated          NASA’S comments into this report where appropriate.
Agency Comments




                  Page   28                                   GAO/NSIAD-90-192   NASA’s Orbital   Maneuvering   Vehicle
Page 29   GAO/NSIAD99-192   NASA’s Orbital   Maneuvering   Vehicle
Appendix I                                                                                              ,

Major Contributors to This Report


                         Charles Rey, Assistant Director
National  Security and                   ,
                         James Morrison Evaluator
International Affairs
Division, Washington,
DC.
                         Lee Edwards, Evaluator-in-Charge
Atlanta Regional         Mark Lambert, Site Senior
                         Karen Lindsey; Evaluator




(897001)                 Page 30                      GAO/NSLAD-99-192   NASA’s Orbital   Maneuvering   Vehicle
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