c A - ‘# L ,. ,,_I _ ““., ,.,,, 1.1. . ,,, . ,I., .A0 United States General Accounting Wwhington, OffIce D.C. 20548 National Security and International Affairs Division B-223094 January 29, 1990 The Honorable John Conyers, Jr. Chairman, Legislation and National Security Subcommittee Committee on Government Operations House of Representatives Dear Mr. Chairman: On August 10, 1989, you requested that we review the Strategic Defense Initiative Organization's (SDIO) funding requirements through completion of phase I of the Strategic Defense System. Our objective was to obtain SDIO's estimate of future funding needs for the acquisition of the phase I system and for research for other programs not part of phase I. On December 12, 1989, we briefed your staff on the preliminary results of our review. This fact sheet summarizes the results of our review. RESULTS IN BRIEF In addition to the $15.7 billion that has already been appropriated during fiscal years 1984 through 1989, SD10 estimates that it will need the following additional funds: $87 billion for completion of phase I development and deployment, $10.1 billion for operation and support for phase I until deployment is completed, and $26.4 billion for non-phase I research and development for fiscal years 1990 through 1994. All estimates are in then-year dollars. These estimates do not include funds that SD10 will need after fiscal year 1994 for non-phase I research and development. BACKGROUND SD10 was established as an agency of the Department of Defense in April 1984. SD10 has concluded that the goal of strategic defense can best be achieved through a phased deployment program. Its deployment concept includes a phase I Strategic Defense System and follow-on phases. The 'initial deployment of the Strategic Defense System (consisting of both space- and ground-based sensors and weapons, battle management, and support elements) is known as a phase I system. , ? B-223094 Since 1984, $15.7 billion has been appropriated to conduct Strategic Defense Initiative (SD11 research, including $1.9 billion for phase I. Additionally, about $1.4 billion has been appropriated to the Department of Energy for advance concepts and SDI-related research. In June 1987 SD10 estimated that phase I would cost between $75 billion and $14,5.7 billion in fiscal year 1988 dollars (between $94.2 billion and $183.6 billion in then-year dollars). SD10 did not make a more precise estimation because details about the technical characteristics and performance requirements for a strategic defense system were not well defined or decided. In June 1988 SD10 revised the architecture and the technical and performance characteristics of the elements in the phase I system and estimated the cost to be $115 billion in fiscal year 1988 dollars ($142.9 billion in then-year dollars). The Department of Defense’s Cost Analysis Improvement Group reviewed SDIO’s estimate and determined that the program, as proposed, was not executable within fiscal guidelines. By October 1988’SDI0 had restructured the program and reduced the estimate to $69.1 billion in fiscal year 1988 dollars ($88.9 billion in then-year dollars). These estimates include funding to develop, produce, and deploy phase I. They do not include funding for any follow-on technologies or costs to operate and support the system once deployed. ESTIMATED FUNDING REQUIR.EMENT SD10 estimated that beginning with fiscal year 1990 it will need $87 billion to complete the development and deployment of the phase I system, $10.1 billi on to operate and support the system until deployment is completed, and $26.4 billion to fund non-phase I research and development for fiscal years 1990 through 1994. All estimates are in then-year dollars. Based on SDIO’s October 1988 estimate of $88.9 billion in then-year dollars for the acquisition of phase I, $87 billion in then-year dollars will be needed for fiscal years 1990 through completion of deployment (the date is classified). The $1.9 billion difference represents appropriations for fiscal years 1988 and 1989 used for o phase I. 2 B-223094 For operation and support of the phase I system until deployment is completed, SD10 estimated that it will need $10.1 billion in then-year dollars. Based on its estimate for operation and support during the last year of deployment, SD10 will need an additional $2.8 billion annually in fiscal year 1988 dollars (the then-year dollar figure is classified) for the life of the system for operation and support. In addition to funding for the phase I system, SD10 estimated that it will need an additional $26.4 billion for fiscal years 1990 through 1994 in then-year dollars for SD1 programs that are not part of phase I. This estimate does not include funding needed for non-phase I research for fiscal years 1995 through the end of deployment. SCOPE AND METHODOLOGY To prepare this fact sheet, we used information provided by SDIO, held discussions with SD10 officials, and reviewed cost projections and planning documents. We did not validate the data, but we did work with SD10 to ensure that the various cost components of the estimates were prepared on a consistent basis. SD10 officials told us that the data were developed for planning purposes and are subject to revision based on funds appropriated by the Congress and approval of funding for individual phase I elements and other SD10 programs. As arranged with your office, unless you publicly announce its contents earlier, we plan no further distribution of this fact sheet until 30 days after its issue date. At that time we will send copies to the Secretary of Defense; the Directors, Strategic Defense Initiative Organization and Office of Management and Budget; and other interested parties. Please contact me at (202) 275-4268 if you or your staff have any questions concerning this fact sheet. Other major contributors to th.is fact sheet are listed in appendix I. Sincerely yours, ‘,’ APPENDIX. I ,APPENDIX I MAJOR CONTRIBUTORS TO THIS FACT SHEET NATIONAL SECURITY AND INTERNATIONAL AFFAIRS DIVISION, WASHINGTON, D.C. Norman J. Rabkin, Associate Director J. Klein Spencer, Assistant Director Samuel N. Cox, Assignment Manager Gregory K. Harmon, Evaluator (392523) Y 4 ..~.
Strategic Defense Initiative: Funding Needs Through Completion of Phase I System
Published by the Government Accountability Office on 1990-01-29.
Below is a raw (and likely hideous) rendition of the original report. (PDF)