[House Hearing, 110 Congress]
[From the U.S. Government Publishing Office]
GAO'S REPORT ON THE STATUS
OF NOAA'S GEOSTATIONARY
WEATHER SATELLITE PROGRAM
=======================================================================
HEARING
BEFORE THE
SUBCOMMITTEE ON ENERGY AND
ENVIRONMENT
COMMITTEE ON SCIENCE AND TECHNOLOGY
HOUSE OF REPRESENTATIVES
ONE HUNDRED TENTH CONGRESS
FIRST SESSION
__________
OCTOBER 23, 2007
__________
Serial No. 110-66
__________
Printed for the use of the Committee on Science and Technology
Available via the World Wide Web: http://www.science.house.gov
______
U.S. GOVERNMENT PRINTING OFFICE
38-339 PDF WASHINGTON DC: 2008
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COMMITTEE ON SCIENCE AND TECHNOLOGY
HON. BART GORDON, Tennessee, Chairman
JERRY F. COSTELLO, Illinois RALPH M. HALL, Texas
EDDIE BERNICE JOHNSON, Texas F. JAMES SENSENBRENNER JR.,
LYNN C. WOOLSEY, California Wisconsin
MARK UDALL, Colorado LAMAR S. SMITH, Texas
DAVID WU, Oregon DANA ROHRABACHER, California
BRIAN BAIRD, Washington ROSCOE G. BARTLETT, Maryland
BRAD MILLER, North Carolina VERNON J. EHLERS, Michigan
DANIEL LIPINSKI, Illinois FRANK D. LUCAS, Oklahoma
NICK LAMPSON, Texas JUDY BIGGERT, Illinois
GABRIELLE GIFFORDS, Arizona W. TODD AKIN, Missouri
JERRY MCNERNEY, California JO BONNER, Alabama
LAURA RICHARDSON, California TOM FEENEY, Florida
PAUL KANJORSKI, Pennsylvania RANDY NEUGEBAUER, Texas
DARLENE HOOLEY, Oregon BOB INGLIS, South Carolina
STEVEN R. ROTHMAN, New Jersey DAVID G. REICHERT, Washington
JIM MATHESON, Utah MICHAEL T. MCCAUL, Texas
MIKE ROSS, Arkansas MARIO DIAZ-BALART, Florida
BEN CHANDLER, Kentucky PHIL GINGREY, Georgia
RUSS CARNAHAN, Missouri BRIAN P. BILBRAY, California
CHARLIE MELANCON, Louisiana ADRIAN SMITH, Nebraska
BARON P. HILL, Indiana PAUL C. BROUN, Georgia
HARRY E. MITCHELL, Arizona
CHARLES A. WILSON, Ohio
------
Subcommittee on Energy and Environment
HON. NICK LAMPSON, Texas, Chairman
JERRY F. COSTELLO, Illinois BOB INGLIS, South Carolina
LYNN C. WOOLSEY, California ROSCOE G. BARTLETT, Maryland
DANIEL LIPINSKI, Illinois JUDY BIGGERT, Illinois
GABRIELLE GIFFORDS, Arizona W. TODD AKIN, Missouri
JERRY MCNERNEY, California RANDY NEUGEBAUER, Texas
MARK UDALL, Colorado MICHAEL T. MCCAUL, Texas
BRIAN BAIRD, Washington MARIO DIAZ-BALART, Florida
PAUL KANJORSKI, Pennsylvania
BART GORDON, Tennessee RALPH M. HALL, Texas
JEAN FRUCI Democratic Staff Director
CHRIS KING Democratic Professional Staff Member
JAMES PAUL Democratic Professional Staff Member
SHIMERE WILLIAMS Democratic Professional Staff Member
TARA ROTHSCHILD Republican Professional Staff Member
STACEY STEEP Research Assistant
C O N T E N T S
October 23, 2007
Page
Witness List..................................................... 2
Hearing Charter.................................................. 3
Opening Statements
Statement by Representative Nick Lampson, Chairman, Subcommittee
on Energy and Environment, Committee on Science and Technology,
U.S. House of Representatives.................................. 8
Written Statement............................................ 9
Statement by Representative Bob Inglis, Ranking Minority Member,
Subcommittee on Energy and Environment, Committee on Science
and Technology, U.S. House of Representatives.................. 10
Written Statement............................................ 10
Prepared Statement by Representative Jerry F. Costello, Member,
Subcommittee on Energy and Environment, Committee on Science
and Technology, U.S. House of Representatives.................. 11
Witnesses:
Mr. David A. Powner, Director, Information Technology Management
Issues, Government Accountability Office
Oral Statement............................................... 11
Written Statement............................................ 13
Biography.................................................... 24
Ms. Mary Ellen Kicza, Assistant Administrator for Satellite and
Information Services, National Environmental Satellite, Data,
and Information Service, National Oceanic and Atmospheric
Administration (NOAA), U.S. Department of Commerce
Oral Statement............................................... 24
Written Statement............................................ 27
Biography.................................................... 31
Discussion
GOES Program Costs............................................. 32
GOES Completion Dates.......................................... 34
GOES-R Procurement............................................. 35
Investing in New Satellites Technologies vs. Reopening Existing
Satellites................................................... 36
Managing GOES and NPOESS Costs................................. 36
GAO Recommendations............................................ 37
GOES Acquisition Strategy...................................... 37
Contractor Performance......................................... 39
Recent Congressional Actions................................... 40
Appendix: Additional Material for the Record
Agreement, NOAA/NASA Support of the GOES-R Program............... 44
GOES-R Independent Review Team, Key Decision Point (KDP) C/D,
Preliminary Readiness Assessment, 25 & 26 June 2007............ 54
GOES-R Management Control Plan (MCP), Version 1, December 4, 2007 95
GAO'S REPORT ON THE STATUS OF NOAA'S GEOSTATIONARY WEATHER SATELLITE
PROGRAM
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TUESDAY, OCTOBER 23, 2007
House of Representatives,
Subcommittee on Energy and Environment,
Committee on Science and Technology,
Washington, DC.
The Subcommittee met, pursuant to call, at 2:08 p.m., in
Room 2318 of the Rayburn House Office Building, Hon. Nick
Lampson [Chairman of the Subcommittee] presiding.
hearing charter
SUBCOMMITTEE ON ENERGY AND ENVIRONMENT
COMMITTEE ON SCIENCE AND TECHNOLOGY
U.S. HOUSE OF REPRESENTATIVES
GAO's Report on the Status
of NOAA's Geostationary
Weather Satellite Program
tuesday, october 23, 2007
2:00 p.m.-4:00 p.m.
2318 rayburn house office building
Purpose
The Subcommittee on Energy and Environment meets on October 23,
2007 to continue oversight on the next-generation Geostationary
Operational Environmental Satellite (GOES) program. The Government
Accountability Office has been continuing its evaluation of progress
made by the National Oceanic and Atmospheric Administration at the
request of the Subcommittee, and will release their new report.
Witnesses
Mr. David Powner, Director, Information Technology Management Issues,
Government Accountability Office
Mr. Powner is the head of the GAO team that has supported the
Subcommittee's oversight of NOAA's major satellite programs for the
past five years. GAO will discuss the findings and recommendations on
NOAA's management of the GOES-R satellite program in the report it will
release at the hearing.
Ms. Mary Ellen Kicza, Assistant Administrator for Satellite and
Information Services, NOAA
Ms. Kicza leads the National Environmental Satellite, Data and
Information Systems (NESDIS) at NOAA, which operates both the
geostationary and polar constellations of weather satellites. Formerly
NASA's Associate Deputy Administrator for Systems Integration, she was
hired by NOAA to bolster efforts to improve satellite program
management in the wake of the severe problems suffered by the National
Polar-Orbiting Operational Environmental Satellite (NPOESS) program.
Ms. Kicza now has the responsibility for execution of the GOES program
to be discussed today, and will provide NOAA's response to the GAO
report.
Background
Watching the Western Hemisphere
GOES satellites orbit 22,300 miles above the Earth's equator, an
altitude where their orbital velocity matches the speed of Earth's
rotation. As a result, these satellites maintain the same relative
position over a particular point on the planet, and can look down to
take pictures of weather patterns over the entire Western Hemisphere. A
prototype satellite was launched in 1974; the first GOES satellite went
into orbit in 1975. Today, normal practice has two GOES satellites in
orbit simultaneously, with one focused on each of the U.S. coasts
(GOES-11 and GOES-12). A third (GOES-13) is also kept in space as a
spare to assure uninterrupted coverage.
These satellites are NOAA's primary sources for images and other
data that support the National Weather Service units forecasting severe
weather. The Severe Storm Center uses GOES to track tornadoes,
hailstorms and other weather events threatening life and property over
land. For the Hurricane Center, GOES can allow them to see developing
storms in the areas of the oceans where there are no other
observational sensors. Nightly weather reports at the Nation's local
weather stations regularly bring GOES pictures into homes across
America. GOES would probably be the one satellite NOAA's forecasters
would vote to save if they were allowed to keep only one.
Keeping the Orbital Slots Full
The current GOES-R development program is the third major
procurement for GOES satellites since NOAA assumed responsibility for
funding its own geostationary operational satellites in 1982. In the
previous instances, NOAA purchased five GOES-Next satellites in the
period from 1985-2001, and then contracted for four GOES-N satellites
for the years 1998-2001. The first GOES-N model launched in May 2006 to
be the on-orbit spare\1\ while GOES-O and GOES-P have been completed
and are in storage for later launches. NOAA in 2002 decided not to
complete the GOES-Q satellite because the existing satellites were
exceeding their expected lifetimes by significant margins.
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\1\ While on the ground, GOES satellites have a letter designation
based on the order in which they were built. After launch, checkout and
acceptance testing in orbit, it is changed to a number. Therefore,
GOES-N is now identified as GOES-13.
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The GOES-R program was to represent the first major upgrade to the
satellite sensors since GOES-8 went into orbit in 1994. As originally
planned, NOAA would buy four satellites and intended to spend $6.2
billion for the life cycle period 2007-2020. Launch of the first
satellite was expected in 2012. As it had with the NPOESS program, NOAA
issued instrument contracts with the intent to later transfer them to
the contractor that would win the prime contract for the overall
satellite system. NOAA also intended to take on the overall
responsibility for procurement of the entire satellite system,
including the spacecraft, instruments, ground systems and integration.
NOAA told GAO that this management structure would ``. . .streamline
oversight and fiduciary responsibilities. . .'' \2\ in the program and
overcome barriers that NOAA believed ``. . .limited the agency's
insight and management involvement in the procurement of major elements
of the system.'' \3\
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\2\ Statement of David Powner before the Subcommittee on Energy and
Environment, September 29, 2006; p. 9.
\3\ Supra., p. 8.
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By the time the Committee met for GAO's first report on the GOES-R
program last September, some significant changes had been made. NOAA
Administrator Lautenbacher informed Members that the cost estimate for
the original program had risen to $11.4 billion. As a result, the
agency reduced the number of satellites to be purchased by half, to
two. The second major instrument, the Hyperspectral Environmental
Suite, was removed because the technical challenge was deemed too
great. Finally, first launch availability would now be December 2014.
With these changes, the program's new life cycle (2003-2028) cost
estimate reflected in the President's FY 2008 budget request, was $6.96
billion.
Responding to recommendations from an Independent Review Team (IRT)
chaired by former Lockheed Martin President Tom Young, NOAA also
determined in March that the GOES-R program should not follow the same
acquisition strategy as NPOESS. Rather than a single prime contractor,
there would be a contract for space systems managed for NOAA by NASA's
Goddard Space Flight Center and a separate contract for those system
elements on the ground to be managed by NOAA. The IRT argued that this
would allow NOAA to benefit from the expertise in both agencies.
Instruments for the spacecraft would be acquired by NASA and supplied
as government-furnished equipment to the satellite contractor. NASA
should take on the responsibility for system integration. GOES-R was
the first program to be taken on by a new Program Management Council at
NOAA, where senior agency managers from NOAA would review progress on a
monthly basis. Space elements will also undergo review by management
councils at Goddard Space Flight Center.
GAO's Progress Report
I. Does NOAA buy GOES-R?
GAO's first finding is that the change in acquisition strategy has
delayed NOAA's decision to move forward on the acquisition of GOES-R,
originally planned for last month. This would have the effect of
stalling the competitions for both program segments (the space segment
contract was expected to be releases in May 2008, followed by the
ground system contract in August 2008). According to a briefing for
Committee staff on September 21, the Independent Review Team reported
to NOAA that they believed the ground system segment definition was
some 6-12 months behind the point it needed to be to permit the agency
to seek bidders. NOAA now has a tiger team at work to satisfy the IRT
concerns. The agency hopes to be able to minimize the differences in
schedule between the two system elements.
With the effort NOAA has devoted to the GOES-R program, it is
highly unlikely that a decision would be made not to go forward at this
point. However, it is a reasonable question to ask whether the increase
in capability offered by the proposed program justifies the significant
increase in cost per satellite. Originally the GOES-N series of
satellites was to incorporate new capabilities beyond those provided by
GOES I-M. Instead, they proved to be quite similar in capability to
their predecessors. What would be the cost to NOAA of a decision not to
pursue GOES-R in favor of continued purchases of the existing GOES
design? How difficult would it be to carry out that decision?
II. What Will GOES-R Cost?
Cost estimating is the bane of large, complex programs at federal
agencies, particularly when technical boundaries are being challenged.
GAO reports that the cost estimates prepared by the program office and
by an independent team differed by some $2.4 billion--while the program
office continued to cost the program at $6.9 billion, the independent
team concluded that the program as currently designed would cost $9.3
billion. Both estimates are reported at the 80 percent confidence level
(i.e., there is an 80 percent chance that if all of the assumptions in
the cost models prove accurate, then the program will ultimately cost
the amount calculated by the respective models).
GAO concluded, after reviewing the materials provided by NOAA, that
the $6.9 billion estimate is likely to rise. NOAA vigorously challenges
GAO's conclusion. The agency questions GAO's evaluation of the
inflation assumptions used in both estimates, and notes that as the
agency has worked to reconcile the different estimates, the independent
team's estimate in this area now uses DOD-standard inflation
assumptions and is now $600 million above the program office estimate.
NOAA stated in its response to GAO that ``[t]he most conservative
estimates at the 80 percent confidence intervals bring the [program
office estimate] within 12 percent of the ICE [independent cost
estimate], or $1.032 billion below the ICE [$9.3 billion].'' If NOAA's
statement is accepted as accurate, this indicates that the reconciled
cost estimate to be submitted in the FY 2009 President's budget request
it will be somewhere in the vicinity of $8 billion-$1 billion over the
current estimate.
GAO also reports that the independent cost estimating team is
skeptical of the December 2014 launch availability for GOES-R. They
believe there is an even chance that GOES-R would be ready for launch
in October 2015, and an 80 percent chance that March 2017 will be the
date. Again, NOAA responds that there is only an 11-month difference
between the program's December 2014 date and the independent estimators
accept this as reasonable. GAO believes that the date should be
compared to the later March 2017 date, which represents the 80 percent
confidence level.
III. Tracking Risk
GAO discussed the current types of risks being tracked by the GOES
program office and the managers of the space and ground segment. There
are no high-risk (where something that could seriously disrupt the
program is judged to have a high probability of happening) issues
currently identified, and NOAA has already addressed some, such as
solidifying the program requirements document.
GAO noted that the risk analysis for the ground segment identified
``. . .schedule interdependencies between the flight and operations
projects offices as a medium criticality risk, but that neither the
flight project office or the program identified this risk even though
it is relevant to both.'' GAO recommended that NOAA maintain a program-
level list of risk; NOAA has agreed and has made this a responsibility
of the systems integration division. The Program Director will also
provide monthly updates to the NOAA Program Management Council on the
full risk list.
GAO also recommended adding three other risks to the new
consolidated list. The first involved vacancies in key management
positions. The System Program Director (SPD) is currently operating in
an acting role (although she has extensive experience with GOES-R as a
result of her position as Deputy Assistant Administrator for Systems in
NESDIS). The Deputy System Program Director position is also filled in
an acting role. The new Assistant SPD went on duty on September 4. NOAA
is currently running a competition for the Program Director and will
begin a new one for the Deputy position (no acceptable candidate was
selected after the first competition). The need for stable, long-term
expertise in leadership positions for programs like GOES-R is often
cited as a lesson learned from previous program failures.
In its report, GAO notes that the Advanced Baseline Imager (ABI),
the most critical sensor aboard GOES-R, is operating with only a one
percent management reserve held by the contractor. This is, of course,
far too low; reserves for instrument development normally are no lower
than 20 percent. NOAA responds that the GOES-R program will maintain
reserves in both of the project offices and at the program level.
Instrument contractors will draw reserves from the overall reserve
maintained by the Flight Project and, if necessary, from the Program
Office. The acting Program Director believes this plan requires
extensive and continuing oversight by the Flight Project Manager in
order to avoid depleting that reserve, and to allow NOAA to keep
control of the reserve. GAO noted that the ABI has already suffered
from technical and cost challenges that have led to one re-baselining
and call on the Project Office reserve. The Project Office reserve
dropped to 15 percent in July, although NOAA indicated in its comments
that it has been increased to 20 percent. GAO estimates that the ABI
program has some 40 percent of its work remaining and believes that the
impact it has had on the existing reserve, even before GOES-R enters
the development and production phase, indicates trouble in the future.
Finally, GAO and NOAA disagree about the level of insight NOAA has
into NASA's management of the program's space segment. In July 1991,
reviewing the development of the GOES-Next satellites (what became the
I-M satellites currently in service), GAO reported to the Committee
that the project was in serious trouble. Among the reasons was that
NOAA did not require NASA to conduct appropriate engineering analyses
before development of the satellites began (due to fiscal constraints
and pressure to make the new satellites available for launch). Senior
officials in the National Weather Service also said that NESDIS and
NASA did not tell them that the solution to the instrument-pointing
accuracy requirements would be very complex and difficult to
accomplish. One of the reasons NOAA originally intended to serve as the
program integrator was to overcome such communication problems.
GAO believes that the interagency agreement NOAA and NASA reached
to govern the GOES-R program does not give NOAA--which is responsible
for funding and executing the program--enough knowledge of contractor
performance in the space segment managed by NASA. While NOAA receives
contractor cost data from NASA, GAO questions if it is sufficient for
NOAA to raise questions about its validity only with NASA. NOAA's
response argues that with NOAA persons working in the Flight Project
office at Goddard Space Flight Center, there will be extensive day-to-
day oversight. The Program Office and Flight Project office will
interact regularly. Further, NOAA personnel will participate in the
NASA technical reviews during the program even before the monthly
Program Management Council review at NOAA Headquarters. This is a risk
that involves the differing cultures of the two agencies and will be
reduced as NOAA assigns personnel with the appropriate technical
expertise and experience to its positions in the GOES-R management
structure.
The Sounder of Tomorrow
As noted earlier, one of the major changes to the GOES-R program
was the decision to eliminate the Hyperspectral Environmental Suite
(HES). This instrument was intended to enhance the ability to look down
through the atmosphere to determine the temperature and moisture levels
at various altitudes. Such data are critical inputs to forecasting
models used by the National Weather Service. In the case of hurricane
forecasting, the sensor is being designed to provide more refined
measurements of winds surrounding the core of hurricanes to identify
steering winds and better predict the storm's path. HES was also
intended to improve our capability to monitor the waters of the
continental shelf and coastal areas. NOAA states that it will be
possible to use the Advanced Baseline Imager, combined with data from
weather balloons and other sensors, to obtain results equivalent to
that produced by the sounder now aboard the existing GOES satellites to
meet the agency's needs when GOES-R becomes operational.
The recent National Research Council Earth Science Decadal Survey
recommended that ``. . .NOAA develop a strategy to restore the
previously planned capability to make high temporal- and vertical-
resolution measurements of temperature and water vapor from
geosynchronous orbit.'' \4\ At the time, NOAA had three contracts to
identify ways to reduce risk in the HES instrument outstanding, and the
Survey members suggested extending them to seek some option for
providing improved sounding capability on GOES-R. While NOAA ultimately
decided to allow the contracts to expire, the contractors involved have
stated to Committee staff that sufficient insight has been gained to
demonstrate an improved sounder aboard GOES-R. Although it would not be
capable of meeting the original requirements for HES, it would
represent a marked improvement over the existing sounder. However, in
April, Administrator Lautenbacher announced there would be no new
geostationary capability until at least GOES-T. Ms. Kicza stated at the
time that alternatives for a future sounder would be explored.\5\
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\4\ National Research Council. Earth Science and Applications from
Space: National Imperatives for the Next Decade and Beyond. National
Academies Press, 2007; p. 2-11.
\5\ Iannotta, Ben. ``Temperature and Humidity Sounder Will Not Fly
on GOES-R.'' Space News, April 16, 2007; p. 10.
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NOAA has now canceled a major instrument on each of its next-
generation satellite systems after investing significant resources (the
Conical Microwave Imaging Sounder on NPOESS being the other), thereby
reducing the chance for improved performance over existing satellites.
In both cases, the agency said that the instruments proved too
challenging. It emerged later, however, that in both cases it was the
pursuit of a particular measurement (ocean color for HES and soil
moisture for CMIS) that proved to be the bottleneck. NOAA's process for
developing requirements and managing the trade-offs invariably required
when operating on technology's leading edge proves the perceptiveness
of Voltaire's observation that ``the best is the enemy of the good.''
One of the key issues for the Committee is to examine how we can
improve the process for developing and acquiring advanced technologies
for environmental monitoring and weather forecasting while maintaining
cost control over the development and acquisition of satellite systems.
Chairman Lampson. This hearing will come to order. I wish
you a good afternoon. The Subcommittee on Energy and
Environment meets today for a report on the Geostationary
Operational Environmental Satellite or GOES Program. Satellites
which have been serving America since 1975, watch over the
whole Western Hemisphere from their positions 22,300 miles
about the Earth. They send back the pictures that your local
weather reporter shows you every night. Those satellites
provide the dramatic pictures of hurricanes that we all see
when these storms are churning toward the coast. They enable
forecasters to alert us that severe weather is on the way. It
is the weather satellite no one wants to be without, especially
those of us who represent the coastal areas.
Designing and flying satellites is a difficult business,
and even with years of experience there are always frustrations
in bringing new ones into service. In the early 1990s, the
General Accounting Office told Congress that the generation of
GOES satellites then in development was in serious trouble. The
instruments were behind schedule, the program cost had more
than doubled, and it still was not clear when the satellites
would be launched. At least today we are not in the position of
having the last GOES satellite in orbit with its fuel tanks
almost empty.
Last year, NOAA Administrator Lautenbacher told us that the
GOES Program cost estimates had almost doubled, and in order to
bring them back within the agency's limited budget, he was
cutting the number of satellites in half and eliminating one of
the major instruments. An independent review team took issue
with NOAA's intent to manage the GOES Program by itself,
questioning whether there were enough people in the agency who
know how to handle satellite design and development. The Earth
Science Decadal Survey issued earlier this year by the National
Research Council urged NOAA to find a way to recover the
capability represented by the eliminated sensor. Our GAO team
recommended a full-scale review of the Advanced Baseline
Imager, the primary sensor, and bolstering the agency's
management capability.
NOAA has been responding to all this advice, as Mr. Kicza
will explain in her testimony. The agency decided that it did
not or that it did have to ask NASA for help and has given its
sister agency the responsibility to manager those elements of
the GOES Program that will fly in space. It will apply its own
special expertise to the grand side of the program. It has
brought over NASA staff to supplement its own program and
project managers. It completed the review of the Advanced
Baseline Imager. Today it is at the point where the decision
has to be made to buy GOES-R. That makes it a good time to see
where we are.
Mr. Powner from GAO has some important messages to bring
out in his statement. It appears that the program cost estimate
will be around $8 billion by the time we receive the
President's budget request this year. This is some $1 billion
more than the estimate Admiral Lautenbacher gave us last year.
That is not a good trend. It concerns me to find out that we
are operating with both an acting program director and an
acting deputy program director, and that NOAA's first attempt
to fill the deputy's slot couldn't find someone for the job.
There appears to be strong disagreement between our witnesses
about the relationship between NOAA and NASA in terms of
managing the space segment of the GOES Program. I trust Ms.
Kicza will discuss that with us.
The Chair of NOAA's Independent Review Team, Tom Young,
knows from his own experience and many reviews of what went
wrong in other satellite programs, where to look to figure out
how well a project like GOES is progressing. He has told us
that the opportunity to get GOES right is there.
So I hope today's hearing will keep GOES moving in the
right direction. I thank you for being here, and I recognize
the Ranking Member, Mr. Inglis, for his opening remarks.
[The prepared statement of Chairman Lampson follows:]
Prepared Statement of Chairman Nick Lampson
Good afternoon. The Subcommittee on Energy and Environment meets
today for a report on the Geostationary Operational Environmental
Satellite, or GOES, program. These satellites, which have been serving
America since 1975, watch over the whole Western Hemisphere from their
positions 22,300 miles above Earth. They send back the pictures that
your local weather reporter shows you every night. GOES satellites
provide the dramatic pictures of hurricanes that we all see when these
storms are churning toward the coast. They enable forecasters to alert
us that severe weather is on the way. It's the weather satellite no one
wants to be without, especially those of us who represent coastal
areas.
Designing and flying satellites is a difficult business, and even
with years of experience there are always frustrations in bringing new
ones into service. In the early 1990s, the General Accounting Office
told Congress that the generation of GOES satellites then in
development was in serious trouble. The instruments were behind
schedule, the program cost had more than doubled, and it still was not
clear when the satellites would be launched. At least today we are not
in the position of having the last GOES satellite in orbit with its
fuel tanks almost empty.
Last year, NOAA Administrator Lautenbacher told us that the GOES
program cost estimates had almost doubled, and in order to bring them
back within the agency's limited budget he was cutting the number of
satellites in half and eliminating one of the major instruments. An
independent review team took issue with NOAA's intent to manage the
GOES program by itself, questioning whether there were enough people in
the agency who know how to handle satellite design and development. The
Earth Science Decadal Survey issued earlier this year by the National
Research Council urged NOAA to find a way to recover the capability
represented by the eliminated sensor. Our GAO team recommended a full-
scale review of the Advanced Baseline Imager (the primary sensor) and
bolstering the agency's management capability.
NOAA has been responding to all this advice, as Ms. Kicza will
explain in her testimony. The agency decided that it did have to ask
NASA for help and has given its sister agency the responsibility to
manage those elements of the GOES program that will fly in space. It
will apply its own special expertise to the ground side of the program.
It has brought over NASA staff to supplement its own program and
project managers. It completed the review of the Advanced Baseline
Imager. Today, it is at the point where the decision has to be made to
buy GOES-R. That makes it a good time to see where we are.
Mr. Powner from GAO has some important messages to bring out in his
statement. It appears that the program cost estimate will be around $8
billion by the time we receive the President's budget request this
year. This is some $1 billion more than the estimate Admiral
Lautenbacher gave us last year. That is not a good trend. It concerns
me to find out that we are operating with both an acting Program
Director and an acting Deputy Program Director--and that NOAA's first
attempt to fill the Deputy's slot couldn't find someone for the job.
There appears to be strong disagreement between our witnesses about the
relationship between NASA and NOAA in terms of managing the space
segment of the GOES program. I trust Ms. Kicza to discuss that with us.
The Chair of NOAA's Independent Review Team, Tom Young, knows from
his own experience--and many reviews of what went wrong in other
satellite programs--where to look to figure out how well a project like
GOES is progressing. He has told us that the opportunity to get GOES
right is there. I hope today's hearing will keep GOES moving in the
right direction.
Thank you, and I recognize the Ranking Member, Mr. Inglis, for his
opening remarks.
Mr. Inglis. Thank you, Mr. Chairman. Thank you for holding
this hearing on the Geostationary Operational Environmental
Satellites-R Series. This hearing continues close oversight of
this vital weather satellite program, oversight that started in
the last Congress.
Last September the Government Accountability Office came
before the Science Committee to report on the status of GOES-R
series procurement. GAO also made recommendations on how to
proceed so as to avoid any further cost overruns while ensuring
that technological development stays on schedule.
More than a year later we are meeting again with witnesses
from GAO and NOAA to discuss the status of the GOES-R Program.
However, there are disagreements this time around about GAO's
assessment of where program development stands.
I look forward to hearing if and why NOAA disagrees with
GAO's assessment that the project costs will be nearly two
billion more than last year's outlook, and why the satellites
may not be ready for launch until as late as 2017.
I am particularly concerned that possible launch delays
will result in discontinuity of valuable forecasting data, the
kind of data that the Chairman was just referencing. If GOES-R
fails to launch until 2017, and doesn't come online until 2019,
will NASA, NOAA, and weather forecasters lose access to the
information they need to accurately predict and observe storms?
Those of us responsible for this program, Congress, NOAA,
and NASA, cannot lightly allow delays and cost overruns. GOES-R
toady is a $6.9 billion program for two satellites. That is a
lot of taxpayer money. We expect that investment to provide a
series of weather satellites that are launched on time and
provide data to ensure the most accurate possible weather
forecasting and modeling.
I look forward to hearing from our witnesses today and
yield back the balance of my time, Mr. Chairman.
[The prepared statement of Mr. Inglis follows:]
Prepared Statement of Representative Bob Inglis
Good afternoon. Thank you, Chairman Lampson, for holding this
hearing about the Geostationary Operational Environmental Satellites-R
series (GOES-R). This hearing continues close oversight of this vital
weather satellite program, oversight that started under Republican
leadership of this committee.
Last September, the Government Accountability Office came before
the Science Committee to report on the status of the GOES-R series
procurement. GAO also made recommendations on how to proceed so as to
avoid any further cost overruns while ensuring that technological
development stays on schedule.
More than one year later, we are meeting again with witnesses from
GAO and the National Oceanic and Atmospheric Administration to discuss
the status of the GOES-R program. However, there are disagreements this
time around about GAO's assessment of where program development stands.
I look forward to hearing if and why NOAA disagrees with GAO's
assessment that the project costs will be nearly $2 billion more than
last year's outlook, and why the satellites may not be ready for launch
until as late as 2017.
I'm particularly concerned that possible launch delays will result
in discontinuity of valuable forecasting data. If GOES-R fails to
launch until 2017, and doesn't come online until 2019, will NASA, NOAA,
and weather forecasters lose access to the information they need to
accurately predict and observe storms?
Those of us responsible for this program, Congress, NOAA, and NASA,
cannot lightly risk delays and cost overruns. GOES-R today is a $6.9
billion program for two satellites. That is a lot of taxpayer money. We
expect that investment to provide a series of weather satellites that
are launched on time and provide data to ensure the most accurate
possible weather forecasting and modeling.
I look forward to hearing from our witnesses today and yield back
the balance of my time.
Chairman Lampson. Thank you, Mr. Inglis. I ask unanimous
consent that all additional opening statements submitted by
Subcommittee Members may be included in the record. Without
objection, so ordered.
[The prepared statement of Mr. Costello follows:]
Prepared Statement of Representative Jerry F. Costello
Mr. Chairman, I appreciate the Subcommittee revisiting the issue of
how the development of the GOES-R satellite system is progressing. This
is an important subject given the dependence we have on geostationary
weather satellites for weather forecasting. The American public has
grown very accustomed to up-to-the-minute weather information,
particularly regarding hurricanes and other severe storms. Given the
loss of life and property that are at stake in these situations,
maintaining a robust program is essential. As we know, satellite
development is extremely complex, but is critical to the ongoing
performance of the GOES series.
The new GAO report to be released today expresses some continued
concerns about the GOES-R program, particularly surrounding the cost
estimate and the interaction between NOAA and NASA. It also indicates
that some progress has been made, and I look forward to hearing more
details from Ms. Kicza about how NOAA is working to improve the overall
performance of its satellite delivery.
Mr. Chairman, oversight of federal spending is one of our most
basic responsibilities. As I have said before, it becomes even more
important in an era of reduced budgets. I again commend you for holding
today's hearing and appreciate the time and expertise of our witnesses.
Chairman Lampson. It is my pleasure today to introduce our
witnesses. Mr. David Powner, who is the Director of Information
Technology Management Issues at the Government Accountability
Office. He is the head of the GAO team that has supported the
Subcommittee's oversight of NOAA's major satellite programs for
the last five years.
And Ms. Mary Ellen Kicza is the Assistant Administrator for
our Satellite and Information Services and leads the National
Environmental Satellite Data and Information Systems, NESDIS,
at NOAA, which operates both the geostationary and polar
constitutions of weather satellites.
We welcome both of you.
You will each have five minutes for your spoken testimony.
Your written testimony will be included in the record for the
hearing, and when you both have completed your testimony, we
will begin with questions. Each Member will have five minutes
to question the panel, and we will get to that in a few
minutes.
Mr. Powner, we will begin with you, please.
STATEMENT OF MR. DAVID A. POWNER, DIRECTOR, INFORMATION
TECHNOLOGY MANAGEMENT ISSUES, GOVERNMENT ACCOUNTABILITY OFFICE
Mr. Powner. Chairman Lampson, Ranking Member Inglis, and
Members of the Subcommittee. We appreciate the opportunity to
testify this afternoon on our GOES-R report completed at your
request. Your early oversight, Mr. Chairman, has been essential
to ensure that NOAA is effectively planning for this critical
satellite acquisition.
Today, as requested, I will provide an update on the GOES-R
current cost and schedule estimate, our assessment of whether
NOAA is adequately addressing key technical and programmatic
risks, and recommendations going forward.
Last September when we testified before you, Mr. Chairman,
we discussed GOES as a fourth satellite program costing over $6
billion in the cost and scope uncertainties. Specifically, the
cost was approaching $12 billion double the original estimate.
Since that time the program dropped a complex sensor,
decreased the number of satellites from four to two, and
revised its lifecycle cost estimate to $7 billion with the
launch of the first satellite in 2014. As the program
approaches critical contract award dates next year, the program
cost estimates are growing, and schedules are being extended.
Independent studies estimate that the two satellite program
will cost about $2 billion more than the current $7 billion
program, and the first satellite is to be delayed two years.
The reasons for the differences between the independent
estimate and NOAA's estimate include differences in government
costs, the space and ground segments, and different assumptions
regarding inflation. No one commenting on our draft report told
us that the revised estimate is likely to go up $1 billion and
have about a year delay.
However, this revised estimate is not expected to be
released until February of next year with the President's 2009
budget. Two points regarding the cost estimate. First, most
satellite programs overrun even the most conservative
independent cost estimate, and second, we remain concerned that
an estimate is being developed more based on how acceptable it
is in the next budget cycle rather than whether it is a true
reflection of what the program will cost.
Turning to risks, NOAA has established a solid risk
management program. Specifically, it has identified key risks
and put in place mitigation plans. For example, key risks
include the lack of an integrated master schedule and technical
risks associated with Advanced Baseline Imagery (ABI) sensor.
However, we found several areas for improvement. We found
inconsistencies among GOES-R's different risk lists. For
example, the ground segment identified interdependencies among
the space and ground segments as a key risk but the space nor
the overall program identified this.
We, therefore, recommended that NOAA use a program-wide
list that is reconciled with other risk activities. NOAA
acknowledged that this is needed and now has an updated
program-wide risk list.
We also found that several important key risks were not
being acknowledged and made recommendations that NOAA
acknowledge these risks, develop mitigation plans, and report
the status of these key risks to senior executives. These risks
include key leadership positions that need to be filled, NOAA's
limited insight into NASA's deliverables, and the early
depletion of management reserves, expanding on each of these.
Two senior GOES-R Program positions, the system program
director and the deputy director, are currently filled by
personnel in acting capacities. NOAA's working aggressively to
fill these positions.
In prior GOES acquisitions an issue with NOAA's limit was
NOAA's limited insight into the portions of the procurement
managed by NASA. During our review we heard that this continues
to be an issue. In particular, when it comes to NOAA's ability
to review key costs and schedule information for the space
segment that NASA is responsible for.
NOAA disagreed with our assessment recommendation in this
area and has reported an unparalleled level of transparency
between the two agencies. Given the past problems NOAA has
experienced obtaining insights into NASA's contracts, we
believe that NOAA should acknowledge this risk and manage it
appropriately.
We also remain concerned about the early depletion of
management reserves at the early stage of this acquisition.
NOAA has downplayed the risk, stating that their overall
program reserve is consistent with best practices. We, however,
believe that this should be managed aggressively since it is
likely to result in increased program costs.
In summary, Mr. Chairman, NOAA is positioning itself to
more effectively manage the GOES-R acquisitions. However,
moving forward a realistic cost and schedule estimate is
needed, as is even more aggressive risk management.
This concludes my statement. Thank you for your oversight
of this important satellite acquisition.
[The prepared statement of Mr. Powner follows:]
Prepared Statement of David A. Powner
Mr. Chairman and Members of the Subcommittee:
We appreciate the opportunity to participate in today's hearing on
the planned Geostationary Operational Environmental Satellites-R series
(GOES-R) program. The GOES-R series is to replace the current series of
satellites, which will likely begin to reach the end of their useful
lives in approximately 2014. This new series is expected to mark the
first major technological advance in GOES instrumentation since 1994.
It is also considered critical to the United States' ability to
maintain the continuity of data required for weather forecasting
through the year 2028.
As requested, our testimony summarizes the report we issued today
on the GOES-R program. Specifically, we (1) assessed the status and
revised plans for the GOES-R procurement and (2) evaluated whether the
National Oceanic and Atmospheric Administration (NOAA) is adequately
mitigating key technical and programmatic risks facing the GOES-R
program.\1\ In preparing for this testimony, we relied on our work
supporting the accompanying report. That report contains a detailed
overview of our scope and methodology. All of the work on which this
testimony is based was performed in accordance with generally accepted
government auditing standards.
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\1\ GAO, Geastationary Operational Environmental Satellites:
Progress Has Been Made, But Improvements Are Needed to Effectively
Manage Risks, GAO-08-18 (Washington, D.C.: Oct. 23, 2007).
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Results in Brief
NOAA has made progress on its GOES-R procurement--which is
estimated to cost $7 billion and scheduled to have the first satellite
ready for launch in 2014--but costs and schedules are likely to grow.
Specifically, NOAA completed preliminary design studies of its
GOES-R acquisition and planned to make a decision to proceed to
development and production in September 2007. In addition, the agency
recently decided to separate the space and ground elements of the
program into two separate contracts to be managed by the National
Aeronautics and Space Administration (NASA) and NOAA, respectively.
However, this change in the GOES-R acquisition strategy has delayed the
decision to proceed with the acquisition. Further, independent
estimates are higher than the program's current cost estimate and
convey a low level of confidence in the program's schedule. Independent
studies show that the estimated program could cost about $2 billion
more, and the first satellite launch could be delayed by two years. As
NOAA works to reconcile the independent estimate with its own program
office estimate, costs are likely to grow and schedules are likely to
be delayed. However, NOAA officials stated that while their
reconciliation process is still ongoing, the revised cost estimate will
likely be $1 billion more than the current $7 billion and the first
satellite launch will likely be delayed one year from 2014, rather than
two years.
To address cost, schedule, and technical risks, the GOES-R program
has established a risk management program and has taken steps to
identify and mitigate selected risks. For example, as of July 2007, the
program office identified the lack of an integrated master schedule as
its highest priority risk. It also identified other risks including
technical challenges affecting the development of a critical instrument
and the development of requirements between the space and ground
segments. The program has also established plans for bringing these
risks to closure. However, more remains to be done to fully address
risks. Specifically, the program has multiple risk watch lists that are
not always consistent. Further, key risks are missing from the risks
lists, including risks associated with unfilled executive positions,
limitations in NOAA's insight into NASA's deliverables, and
insufficient funds for unexpected costs (called management reserve). As
a result, the program is at risk that problems will not be identified
or mitigated in a timely manner and could lead to program cost overruns
and schedule delays.
To improve NOAA's ability to effectively manage the GOES-R
procurement, in our report being released today, we are making
recommendations to ensure that the GOES-R program office manages,
mitigates, and reports on risks using a more comprehensive program-
level risk list. In written comments, the Secretary of Commerce agreed
with our recommendations to use a program level risk list and to add
selected risks to its list, but disagreed that NOAA has insufficient
insight into NASA's contracts. The Secretary cited an unparalleled
transparency between the two agencies. However, NOAA has not
demonstrated that it has validated NASA's contractor performance and we
remain concerned that NOAA lacks the capability to oversee this
important aspect of the program. Given the past problems NOAA had in
obtaining insight into NASA's contracts and the importance of this
interagency relationship to the success of the GOES-R program, we
believe that this issue should be managed and monitored as a risk.
Background
Since the 1960s, geostationary and polar-orbiting environmental
satellites have been used by the United States to provide
meteorological data for weather observation, research, and forecasting.
NOAA's National Environmental Satellite Data and Information Service
(NESDIS) is responsible for managing the civilian geostationary and
polar-orbiting satellite systems as two separate programs, called GOES
and the Polar Operational Environmental Satellites, respectively.
Unlike polar-orbiting satellites, which constantly circle the Earth
in a relatively low polar orbit, geostationary satellites can maintain
a constant view of the Earth from a high orbit of about 22,300 miles in
space. NOAA operates GOES as a two-satellite system that is primarily
focused on the United States. These satellites are uniquely positioned
to provide timely environmental data to meteorologists and their
audiences on the Earth's atmosphere, its surface, cloud cover, and the
space environment. They also observe the development of hazardous
weather, such as hurricanes and severe thunderstorms, and track their
movement and intensity to reduce or avoid major losses of property and
life. Furthermore, the satellites' ability to provide broad,
continuously updated coverage of atmospheric conditions over land and
oceans is important to NOAA's weather forecasting operations.
To provide continuous satellite coverage, NOAA acquires several
geostationary satellites at a time as part of a series and launches new
satellites every few years (see Table 1).
Three satellites--GOES-11, GOES-12, and GOES-13--are currently in
orbit. Both GOES-11 and GOES-12 are operational satellites, while GOES-
13 is in an on-orbit storage mode. It is a backup for the other two
satellites should they experience any degradation in service. The
others in the series, GOES-O and GOES-P, are planned for launch over
the next few years. NOAA is also planning the next generation of
satellites, known as the GOES-R series, which are planned for launch
beginning in 2014.
GOES-R Program--An Overview
NOAA plans for the GOES-R program to improve on the technology of
prior series, in terms of both system and instrument improvements, to
fulfill more demanding user requirements and to provide more rapid
information updates. Table 2 highlights key system-related improvements
GOES-R is expected to make to the geostationary satellite program.
In addition to the system improvements, the instruments on the
GOES-R series are expected to significantly increase the clarity and
precision of the observed environmental data. NOAA originally planned
to acquire six different types of instruments. Furthermore, two of
these instruments--the Advanced Baseline Imager and the Hyperspectral
Environmental Suite--were considered to be the most critical because
they would provide data for key weather products. Table 3 summarizes
the originally planned instruments and their expected capabilities.
More recently, however, NOAA reduced the scope of the GOES-R
program because of expectations of higher costs. In May 2006, the
program office projected that total costs, which were originally
estimated to be $6.2 billion, could reach $11.4 billion. We reported
that this led NOAA to reduce the scope and technical complexity of the
baseline program.\2\ Specifically, in September 2006, NOAA reduced the
minimum number of satellites from four to two, canceled plans for
developing the Hyperspectral Environmental Suite, and estimated the
revised program would cost $7 billion. Table 4 provides a summary of
the timeline and scope of these key changes.
---------------------------------------------------------------------------
\2\ GAO, Geostationary Operational Environmental Satellites:
Additional Action Needed to Incorporate Lessons Learned from Other
Satellite Programs, GAO-06-1129T (Washington, D.C.: Sept. 29, 2006) and
Geostationary Operational Environmental Satellites: Steps Remain in
Incorporating Lessons Learned from Other Satellite Programs, GAO-06-993
(Washington, D.C.: Sept. 6, 2006).
GOES-R Program Office Structure
NOAA is solely responsible for GOES-R program funding and overall
mission success. However, since it relies on NASA's acquisition
experience and technical expertise to help ensure the success of its
programs, NOAA implemented an integrated program management structure
with NASA for the GOES-R program. Within the program office, there are
two project offices that manage key components of the GOES-R system.
These are called the flight and operations project offices. The flight
project office oversees the spacecraft, instruments, and launch
services. The operations project office oversees the ground elements
and on-orbit operations of the satellites. The project manager for the
flight project office and the deputy project manager for operations
project office are designated to be filled with NASA personnel.
Additionally, NOAA has located the program office at NASA's Goddard
Space Flight Center.
Planned GOES-R Acquisition Strategy
NOAA's acquisition strategy was to award contracts for the
preliminary design of the GOES-R system to several vendors who would
subsequently compete for the contract to be the single prime contractor
responsible for overall system development and production. As such, in
October 2005, NOAA awarded contracts for the preliminary design of the
overall GOES-R system to three vendors.\3\
---------------------------------------------------------------------------
\3\ These were called Program Definition and Risk Reduction
contracts.
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In addition, to reduce the risks associated with developing
technically advanced instruments, NASA awarded contracts for the
preliminary designs for five of the originally planned instruments.
NASA expected to subsequently award development contracts for these
instruments and to eventually turn them over to the prime contractor
responsible for the overall GOES-R program.
GOES-R Preliminary Design Studies Are Completed, But Key Program
Changes Have Been Made and Cost and Schedule
Estimates Are Likely to Grow
NOAA has completed preliminary design studies of its GOES-R
procurement. In addition, the agency recently decided to separate the
space and ground elements of the program into two separate contracts to
be managed by NASA and NOAA, respectively. However, this change has
delayed a key decision to proceed with the acquisition, which was
planned for September 2007. Further, independent estimates are higher
than the program's current $7 billion cost estimate and convey a low
level of confidence in the program's schedule for launching the first
satellite by 2014. As NOAA works to reconcile the independent estimate
with its own program office estimate, costs are likely to grow and
schedules are likely to be delayed.
Progress Has Been Made on GOES-R Procurement Activities
NOAA and NASA have made progress on GOES-R. The program office has
completed preliminary design studies of the overall GOES-R system and
has initiated development work on most of the planned instruments.
Specifically, the NOAA-issued contracts for the preliminary design of
the overall GOES-R system to three vendors have ended, and the designs
have been completed.
In addition, after completing preliminary designs on five of the
originally planned instruments, NASA awarded development contracts for
three of them.\4\ Further, the most critical of these instruments--the
Advanced Baseline Imager--has completed a major development milestone.
In February 2007, it passed a critical design review gate and NASA
approved the contractor to begin production of a prototype model.
---------------------------------------------------------------------------
\4\ NASA has not yet issued a development contract for the
Geostationary Lightning Mapper. This contract is expected to be awarded
at the end of October 2007.
NOAA Revised Its Acquisition Strategy
NOAA recently made a number of key changes in how it plans to
acquire the GOES-R system. Originally, NOAA planned to award and manage
a single prime contract for the acquisition and operation of the
integrated system. However, an independent review team assessed the
program and found that this approach was risky.\5\ It recommended that
NOAA split the acquisition effort into two separate contracts for the
space and ground segments and have NASA manage the space segment. The
independent review team concluded that there was less risk in
continuing with this approach than there would be if NOAA took on a new
and expanded role.
---------------------------------------------------------------------------
\5\ This independent review team, comprised of former senior
industry and government space acquisition experts, was hired by NOAA to
assess the adequacy of the GOES-R program's management approach,
acquisition strategy, and resource availability, among other things.
---------------------------------------------------------------------------
In March 2007, Commerce approved NOAA's decision to implement these
recommendations. The agency revised its acquisition strategy to include
two separate contracts--the space segment and the ground segment. The
two contracts are expected to be awarded in May 2008 and August 2008,
respectively. The space segment is to be managed by a NASA-led flight
project office. As such, NASA is to be responsible for awarding and
managing the space segment contract, delivering the flight-ready
instruments to the space segment contractor for integration onto the
satellites, and overseeing the systems engineering and integration.
NOAA is to be responsible for the ground segment contract, which is to
be managed by the NOAA-led operations project office.
The revised acquisition strategy has delayed NOAA's plans to
complete a key decision milestone on whether to proceed with GOES-R
development and production in September 2007. Once this decision is
made, the final requests for proposals on the system segments are to be
released. The agency could not provide a timeframe for when this key
decision milestone would take place.
GOES-R Cost Estimates Are Likely to Grow and Schedule Estimates Are
Likely to Slip
NOAA's current estimate that the life cycle cost of the GOES-R
program would be $7 billion is likely to grow, and its estimate that
the first satellite would be launched in December 2014 is likely to
slip. Consistent with best practices in cost estimating, in May 2007,
NOAA had two different cost estimates completed for the current GOES-R
program--one by its program office and one by an independent cost
estimating firm. The program office estimated with 80 percent
confidence that the program would cost $6.9 billion. The independent
estimating firm estimated with 80 percent confidence that the program
would cost $9.3 billion.
A comparison of the two cost models shows that the independent
estimator has about a 20 percent level of confidence that the program
can be completed for $6.9 billion. Further, the independent estimator
concluded that the program office estimate significantly understated
the risk of cost overruns. Other major differences between the two
estimates are contained in government costs and in the space and ground
segments. In commenting on a draft of the accompanying report, NOAA
officials noted that one of the differences between the estimates is
the inflation rate. The independent estimator assumed a higher
inflation rate than the rate that NOAA and NASA typically use. NOAA
officials noted that if the independent estimate was adjusted to NOAA's
inflation rate, the program's cost estimate--with 80 percent
confidence--would be $8.7 billion. However, we believe that the value
of an independent estimate is that it does not necessarily use the same
assumptions as the program office. By offering alternative assumptions,
the independent estimate provides valuable information for government
officials to consider when revising program cost estimates.
Program officials are reconciling the two different cost estimates
and plan to establish a new program cost estimate to be released in
conjunction with the President's fiscal year 2009 budget in February
2008. Program officials were unable to provide us information on the
reconciled estimate until it is released. Nonetheless, the revised cost
estimate will likely be $1 billion more than the current $7 billion.
Regarding schedule, NOAA's current plan to launch the first GOES-R
series satellite in December 2014 could be delayed. This schedule was
driven by a requirement that the satellites be available to back up the
last remaining GOES satellites (GOES-O and GOES-P) should anything go
wrong during the planned launches of these satellites (see Table 5).
However, as part of its cost estimate, the independent estimator
performed a schedule risk analysis. The independent estimator
determined that there was less than a 50 percent chance that the first
satellite would be ready for launch by December 2014 and that a later
date would be more realistic. The estimator determined that it had 50
percent confidence that the first satellite would launch by October
2015 and 80 percent confidence that the satellite would launch by March
2017. A delay of this magnitude could affect the continuity of GOES
data should the agency experience problems with the predecessor
satellites.
NOAA Is Taking Steps to Address Key Risks, But More Remains to Be Done
To address cost, schedule, and technical risks, the GOES-R program
established a risk management program and has taken steps to identify
and mitigate selected risks. However, more remains to be done to fully
address a comprehensive set of risks. Specifically, the program has
multiple risk watch lists and they are not always consistent. Further,
key risks are missing from the risks lists, including risks associated
with unfilled executive positions, limitations in NOAA's insight into
NASA's deliverables, and insufficient funding for unexpected costs
(called management reserve) on a critical sensor. As a result, the
GOES-R program is at increased risk that problems will not be
identified or mitigated in a timely manner and that they could lead to
program cost overruns and schedule delays.
GOES-R Has a Risk Management Program and Is Taking Measures to Address
Selected Risks
The GOES-R program office established a risk management program and
is tracking and mitigating selected risks. Risk management is a leading
management practice that is widely recognized as a key component of a
sound system development approach. An effective risk management
approach typically includes identifying, prioritizing, and mitigating
risks, and escalating key risks to the attention of senior management.
In accordance with leading management practices, the GOES-R program
identifies risks, assigns a severity rating to risks, tracks these
risks in a database, plans response strategies for each risk in the
database, and reviews and evaluates these risks during monthly program
risk management board meetings. Program-wide and project-specific risks
are managed by different offices. The program office identifies and
tracks program-wide risks--those that affect the overall GOES-R
program. NASA's flight project office and NOAA's operations project
office manage risks affecting their respective aspects of the
program.\6\ Further, the program office briefs senior executives on top
program and project risks on a monthly basis.
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\6\ NASA's GOES-R flight project office is responsible for the
spacecraft, instruments, and launch services. NOAA's GOES-R operations
project office is responsible for the ground elements and on-orbit
operations of the satellites.
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GOES-R Program Office Identified and Is Working to Mitigate Program-
wide Risks
As of July 2007, the program office identified three program risks
affecting the overall GOES-R program. These risks include the
development of the integrated master schedule, the ability to secure
authorization to use a key frequency band to meet the space-to-ground
communication data link requirements for the GOES-R system, and the
final approval of the GOES-R mission requirements from the NOAA Deputy
Under Secretary.
NOAA is working to mitigate and close program risks that it is
tracking. For example, the program office recently closed the risk
associated with GOES-R requirements because it had sufficiently defined
and obtained approval of these requirements. As another example, the
program office considers the lack of an integrated master schedule to
be its highest priority risk. Program officials reported that
completion of the integrated master schedule is driven by the
completion of the intermediate schedules for the ground segment and the
space-to-ground inter-dependencies. Key program staff members,
including a resident scheduler, meet on a weekly basis to resolve
outstanding design issues and hone these schedules. Program officials
reported that the intermediate schedules are near completion and that
they plan to have the integrated master schedule completed in Fall
2007. They expect to remove this issue from the risk watch list at that
time.
NASA Identified Flight Segment Risks and Is Working to Mitigate Them
As of July 2007, the NASA flight project office identified four
risks affecting instrument development, all of which are classified as
medium risk. The top three risks pertain to the advanced imaging
instrument, ABI--including issues on timely and quality subcontractor
delivery of a critical part, stray light negatively impacting the
performance of the optical system, and meeting specified performance
requirements on image navigation and registration. The fourth priority
risk pertains to the improvement of subcontractor quality assurance on
a key sensor for the Space Environmental In-Situ Suite.
NASA is working to mitigate the flight segment risks that it is
tracking. For example, the ABI contractor, among other things, plans to
complete a key simulation review before the end of the year (called the
structural thermal optical performance analysis) to evaluate whether
the instrument can meet its expected performance parameters for image
navigation and registration. NASA also recently conducted a vendor
facility assessment of the Space Environmental In-Situ Suite
subcontractor to determine whether adequate quality assurance
improvements had been made to be compliant with contract requirements.
These actions are expected to help mitigate the risk.
NOAA Identified Risks in its Operations Segment and Is Working to
Mitigate Them
As of July 2007, the NOAA operations project office identified five
risks impacting the management and development of the ground system and
operations, including one that is identified as a medium risk. These
risks include, among other things, inadequate definition of flight and
operations project inter-dependencies, algorithm development
responsibilities, and the adequate definition of coordination
requirements between the space and ground segments to ensure that the
two requests for proposals are consistent.
NOAA is working to mitigate the ground system and operations risks
that it is tracking. For example, for the highest priority risk
regarding schedule inter-dependencies, key staff from both the flight
and operations projects meet weekly in order to identify and
synchronize project schedules. The project office expects to close this
risk in Fall 2007.
Multiple Watch Lists Are Not Consistent, Making It Difficult to
Prioritize and Manage Risks
While GOES-R has implemented a risk management process, its
multiple risk watch lists are not consistent in areas where there are
inter-dependencies between the lists, which makes it difficult to
effectively prioritize and manage risks at the appropriate
organizational levels. Sound risk management practices call for having
a consistent prioritization approach and for significant problems to be
elevated from the component level to the program level. This is because
an issue affecting a critical component could have severe programmatic
implications and should be identified, tracked, and overseen at the
program level. In addition, program executives should be briefed
regularly on the status of key risks.
However, on the GOES-R program, the risks identified on the
multiple risk lists are inconsistent in areas where there are inter-
dependencies between the lists. These inter-dependencies include
situations where a risk is raised by one project office and affects the
other project office, but is not identified by the other project office
or elevated to the program level risk list. They also include
situations where a risk identified by a project office has program-wide
implications, but is not elevated to the program level risk list. For
example, the operations project office identified schedule inter-
dependencies between the flight and operations project offices as a
medium criticality risk, but neither the flight project office nor the
program identified this risk even though it is relevant to both. As
another example, the operations project office identified the ground
procurement schedule as a major issue in its briefing to senior
management, but this risk was not identified on its own or on the
program-wide risk lists.
In addition, while the three offices brief senior management about
their key risks on a monthly basis, selected risks may not be
accurately depicted in these briefings because of the inconsistencies
among the risk watch lists. For example, both the flight and operations
project offices identified technical development issues as minor to
moderate risk areas, but the program office did not identify this item
as a risk and, when it briefed senior management, it noted that
technical development was in good shape. Figure 1 depicts examples of
inconsistencies among risk lists and briefings to senior management.
The lack of consistency in managing risks in areas where there are
inter-dependencies makes it difficult to ensure that all identified
risks are appropriately prioritized and managed. This situation hampers
the program office's ability to identify and mitigate risks early on
and to anticipate and manage the impact of risks on other areas of the
program.
Important GOES-R Management Risks Are Missing From the Program Watch
List
To be effective, a risk management program should have a
comprehensive list of risks. However, several key risks that impact the
GOES-R procurement and merit agency attention are not identified in the
program's risk lists. These risks include (1) key leadership positions
that need to be filled, (2) NOAA's limited insight into NASA's
deliverables, and (3) insufficient management reserves (held by the
program and a key instrument contractor). At the conclusion of our
review for the accompanying report, program officials stated that they
are aware of these issues and are working to monitor them or address
them, as warranted. Nevertheless, until these and other program-wide
risks are identified and addressed as part of a comprehensive risk
management program, there is increased likelihood that issues will be
overlooked that could affect the acquisition of the GOES-R system.
Key GOES-R Leadership Positions Need to Be Filled
The two senior GOES-R program positions--the system program
director and deputy system program director--are currently filled by
NASA and NOAA personnel in an acting capacity until they can be
permanently filled by NOAA. In addition, the acting system program
director is not able to work full time in this role because she is also
on a special assignment as the NESDIS Deputy Assistant Administrator
for Systems. NOAA reported that it plans to fill the deputy system
program director role in the near future, but noted that it could take
more than six months to fill the system program director role. Given
the approach of the development phase of the GOES-R acquisition and the
competing priorities of the acting system program director, it is
especially important that these key leadership positions be filled
quickly. At the conclusion of our review, agency officials stated that
they are aware of this issue and are working to fill the positions, but
they did not believe the issue warranted inclusion on the program level
risk watch list. However, without the senior level attention inherent
in a sound risk management program, it is not clear that NOAA is
sufficiently focused on the importance of establishing knowledgeable
and committed program executives, or in moving quickly to fill these
critical positions.
NOAA's Insight into NASA's Program Elements Is Limited
NOAA's March 2007 decision to adopt an acquisition management
approach similar to prior GOES procurements could make the agency
vulnerable to repeating some of the problems experienced in the past.
In particular, our work on the GOES I-M series found that NOAA did not
have the ability to make quick decisions on problems because portions
of the procurement were managed by NASA.\7\ In fact, NOAA officials
originally intended to depart from this approach as a lesson they
learned from the GOES I-M acquisition, because it limited the agency's
insight and management involvement in the procurement of major elements
of the system.
---------------------------------------------------------------------------
\7\ GAO-06-993.
---------------------------------------------------------------------------
The established NOAA/NASA interagency agreements require NASA to
submit monthly contractor cost performance reports to NOAA and to alert
NOAA should cost and schedule performance drop below certain
thresholds. NASA is currently submitting the required reports and has
alerted NOAA on major cost and schedule changes. However, these
interagency agreements do not contain provisions that enable NOAA to
ensure that the data and reports are reliable and that they accurately
depict contractor performance. To do so would entail NOAA having the
ability and means to question and validate data, such as by having
direct access to the contractor.
NASA and NOAA officials reported that the two agencies are working
together with an unparalleled level of transparency and noted that NOAA
program staff have access to contractor data and can bring any
questions with the data to the relevant NASA staff. However, they
acknowledged that this process is not documented and were not able to
demonstrate that NOAA staff had questioned contract data and that NASA
had facilitated obtaining answers to the questions. By not identifying
and mitigating this risk on its program risk list, NOAA increases the
likelihood that the GOES- program will repeat the management and
contractor shortfalls that plagued past GOES procurements.
Recent Changes on a Key Instrument Have Reduced Program Management
Reserve Funds and Limited Contractor Reserve Funds Leave GOES-R
Vulnerable to Future Cost Increases
A recent modification to the critical ABI instrument contract
increased its cost, thereby reducing the amount of management reserve
funds held by the program office for unexpected expenses. In September
2006, we reported that ABI was experiencing technical challenges, that
were resulting in cost and schedule overruns. Since then, the
contractor continued missing cost and schedule targets--a trend that
continued until February 2007. At that time, NASA modified the contract
to implement a revised baseline cost and schedule. The added cost of
this modification was funded using management reserve funds held by the
GOES-R program office.\8\ As a result, the amount of reserve held by
the program office dropped below 25 percent--a level that NOAA reported
it intended to establish as a lesson learned from other satellite
acquisitions. As of July 2007, the program's reserve level was at about
15 percent. Program officials stated that their revised goal is to
maintain between 10 and 15 percent in reserve at the program level.
While maintaining a 10 to 15 percent management reserve is on par with
other major satellite acquisitions, the depletion of management
reserves this early in the GOES-R acquisition raises concerns that
there will be insufficient reserves during the challenging development,
integration, and testing phases to come.
---------------------------------------------------------------------------
\8\ This reserve is intended to cover expected costs above those
projected by the contractor and unexpected costs in solving problems
during a system development program.
---------------------------------------------------------------------------
In addition, the contractor for the ABI instrument has a very low
level of reserve funding for unexpected costs, which means that any
unexpected problems will likely lead to cost growth on the overall
GOES-R program. As of May 2007, the contractor was holding less than
one percent of funding in reserve to cover unexpected costs associated
with the 40 percent of work left to be completed. As such, there is a
risk that the new baseline could fail due to inadequate reserves to
finish the program. This would likely have a diminishing effect on the
reserve held by the GOES-R flight project and the program office to
cover the costs of a second revised baseline plan. Our prior work on
system acquisitions has shown inadequate reserves to be an indicator of
poor management performance that could lead to cost overruns.\9\
Considering that GOES-R has not yet entered the development and
production phases, it will be critical for NOAA's senior executive
management to aggressively manage this risk. By not identifying,
mitigating, and tracking this risk in a program-wide risk list, the
GOES-R program runs an increased risk that unanticipated issues on the
ABI instrument will lead to program-wide cost overruns and schedule
delays.
---------------------------------------------------------------------------
\9\ GAO-06-993.
Implementation of GAO Recommendations Should Improve NOAA's Ability to
Effectively Manage the GOES-R Procurement
To improve NOAA's ability to effectively manage the procurement of
the GOES-R system, we recommended in our accompanying report\10\ that
the Secretary of Commerce direct the Undersecretary of Commerce for
Oceans and Atmosphere to take the following two actions:
---------------------------------------------------------------------------
\10\ G110-08-18.
Ensure that the GOES-R program office manages,
mitigates, and reports on risks using a program-level risk list
that is reconciled with and includes risks from its flight and
operations project offices that could impact the overall
---------------------------------------------------------------------------
program.
Include the following risks on the program-wide risk
list, develop plans to mitigate them, and report to senior
executives on progress in mitigating them:
unfilled or temporary GOES-R program
leadership positions,
insufficient program insight on NASA contract
performance, and
insufficient management reserve on the
critical Advanced Baseline Imager instrument and at the
GOES-R program level.
In written comments, Commerce agreed with our recommendations to
use a program level risk list and to add selected risks to its list.
The department reported that NOAA has established a consolidated
program-wide risk list that is to be used to evaluate risks during
monthly internal and external reviews. Further, NOAA acknowledges the
risks associated with having unfilled leadership positions and
insufficient management reserves and is working to mitigate these
risks. However, the department disagreed with our recommendation to
manage and mitigate the risk that NOAA has insufficient insight into
NASA's contracts. The department cited an unparalleled level of
transparency between the two agencies and listed multiple regular
meetings that the two agencies hold to ensure close coordination. While
an improved working relationship between the two agencies is critical,
NOAA has not provided any evidence that it has been able to effectively
question and validate data on NASA's contractor performance. Given the
past problems that NOAA has experienced in obtaining insight into
NASA's contracts and the importance of this interagency relationship to
the success of the GOES-R program, we believe that this issue should be
managed and monitored as a risk.
NOAA also requested that we acknowledge its effort to reconcile its
program estimate with the independent estimate and reflect a 20 percent
possibility that the program could cost $1 billion more than the
current estimate of $7 billion, rather than $2 billion more. We
acknowledge this in our report; however, the reconciliation effort is
not complete and NOAA did not provide us with a reconciled estimate.
In summary, although NOAA has made progress in the GOES-R
procurement, changes in the GOES-R acquisition strategy could lead to
cost overruns and schedule delays if not managed effectively. Over the
last year, NOAA has completed preliminary design studies of its GOES-R
system and decided to separate the space and ground elements of the
program into two contracts and have NASA oversee the system integration
effort. Current program plans call for a two-satellite program--
estimated to cost about $7 billion--with launch of the first satellite
in December 2014. However, independent studies show that the program's
cost could increase by about $2 billion and that the first launch could
be delayed by at least two years.
NOAA has taken steps to identify and address key risks but more
could be done to effectively manage risks from a program-wide
perspective. In particular, the program has multiple risk watch lists
that are not consistent in areas where there are inter-dependencies and
key risks have not been elevated for program-wide attention. Also,
several risks that warrant NOAA's attention have not been placed on any
watch list. Specifically, the top two leadership positions are only
temporarily filled; NOAA does not have the ability and means to obtain
insight into NASA contracts in order to validate contractor performance
data; and insufficient management reserves to handle unexpected
problems on a critical instrument and at the program level are likely
to affect overall program costs when any unexpected problems arise.
Until NOAA manages and addresses a comprehensive set of program risks,
the agency's ability to effectively manage the GOES-R acquisition will
be significantly weakened and could lead to substantial program
overruns and delays.
Mr. Chairman, this concludes my statement. I would be happy to
answer any questions that you or Members of the Subcommittee may have
at this time.
Biography for David A. Powner
Experience
Twenty years' experience in information technology issues in both
public and private sectors.
Education
Business Administration, University of Denver
Senior Executive Fellows Program, Harvard University, John F. Kennedy
School of Government
Dave is currently responsible for a large segment of GAO's
information technology (IT) work, including systems development, IT
investment management, health IT, and cyber critical infrastructure
protection reviews.
In the private sector, Dave has held several executive-level
positions in the telecommunications industry, including overseeing IT
and financial internal audits, and software development associated with
digital subscriber lines (DSL).
At GAO, Dave has led teams reviewing major IT modernization efforts
at Cheyenne Mountain Air Force Station, the National Weather Service,
the Federal Aviation Administration, and the Internal Revenue Service.
These reviews covered many information technology areas including
software development maturity, information security, and enterprise
architecture.
Chairman Lampson. Thank you, Mr. Powner.
Ms. Kicza.
STATEMENT OF MS. MARY ELLEN KICZA, ASSISTANT ADMINISTRATOR FOR
SATELLITE AND INFORMATION SERVICES, NATIONAL ENVIRONMENTAL
SATELLITE, DATA, AND INFORMATION SERVICE, NATIONAL OCEANIC AND
ATMOSPHERIC ADMINISTRATION (NOAA), U.S. DEPARTMENT OF COMMERCE
Ms. Kicza. Mr. Chairman and Members of the Subcommittee, I
am Mary Kicza, Assistant Administrator for the National
Environmental Satellite, Data, and Information Service within
the National Oceanic and Atmospheric Administration. Today we
are here to talk about NOAA's next generation geostationary
satellite program, GOES-R.
As you said, GOES spacecraft are critical to hurricane and
other severe weather forecasting because they are constantly
taking images and collecting data above the United States. We
have two geostationary satellites operating in space; one over
the east coast and one over the west coast. We do maintain a
spare satellite in orbit in case of any problems with the
operational satellites. We just launched GOES-N, our current
on-orbit spare, and we are finishing building two satellites, O
and P, which will launch, provide data until GOES-R is launched
in 2014.
We are in the final design phase of GOES-R. We plan to
release requests for proposals in early 2008, and to award
contracts for building the new satellites and ground systems by
the end of 2008. GOES-R remains on track for a 2014 launch to
maintain continuity for the GOES-N series.
My written testimony details significant changes we have
made to strengthen our management of the GOES-R Program. We
maintain overall program management responsibility with NOAA
for GOES-R. NASA manages the flight project, which includes
building and integrating the instruments and the spacecraft and
procuring the launch vehicle. NOAA manages the ground system
project, which includes all ground stations and algorithm
development.
These changes place the government in a direct oversight
role for each of the key elements of the GOES-R Program; the
spacecraft, the instruments, and the supporting ground systems.
We have instituted specific matrix and milestones to ensure
problems are quickly identified and fixed. We continue to have
outside independent experts look at our program, and we will
make changes as necessary.
NOAA continues to value the insight and reviews by GAO, and
I would like to respond to the recommendations in the recent
GAO report. As David said, recommendation number one relates to
assuring that risks highlighted in one area are examined for
their potential program-wide implications. NOAA agreed with
this recommendation, and it has already begun to implement a
consolidated risk list that the GOES-R system program director
regularly reviews. The NOAA Program Management Council is
briefed monthly on the top risks and the strategies for
resolving and closing these risks.
Recommendation number two directs that NOAA add the
following risks to the program-wide risk list. These include
unfilled or temporary GOES-R Program leadership positions,
insufficient program insight on NASA contract performance, and
insufficient management reserve on the critical advanced
baseline imagery instrument, and at the GOES-R Program level.
NOAA agrees with highlighting the risks associated with
filling the leadership positions. The GAO in their draft report
had highlighted three vacancies as being of concern. One has
been filled. The remaining two are in the final decision
stages. The status of filling key vacancies is tracked on a
weekly basis at the staff level and formally reviewed on a
monthly basis at NOAA's Program Management Council meeting.
The GOES-R Program is currently being led full-time by Ms.
Abigail Harper. She is my Deputy Assistant Administrator for
Systems Acquisitions. Ms. Harper is highly qualified with
multiple years experience in satellite systems acquisitions and
in satellite systems safety and mission assurance.
Meanwhile, NOAA has expedited its search for the GOES-R
Systems Program Director. I have completed all of the
interviews of the highly-qualified candidates and will be
forwarding my selection to Vice Admiral Lautenbacher within the
week.
We do not fully understand GAO's concern with respect to
NOAA's insight into NASA's performance. We do have
unprecedented insight into NASA contract performance. Our GOES-
R Program is co-located at NASA Goddard with the flight project
and the ground project. Our program interacts with the projects
on a daily basis.
Additionally, we have a comprehensive management control
plan which clearly outlines roles, responsibilities,
authorities, and reporting requirements.
Regarding the recommendation highlighting the reserve
posture as a risk, NOAA believes there are sufficient reserves
on the Advanced Baseline Imagery instrument and at the program
level. When the GAO had reviewed the program earlier this year,
the program had not yet allocated the management reserves to
the project level. We were holding it at the program level.
This may have led to an incorrect interpretation by the GAO as
to the reserve posture. The program does maintain a budget that
reflects at least a 25 percent management reserve. Today, the
GOES-R Program maintains reserve at both the program level and
the project level, and we believe that these reserves are
sufficient to manage risks.
We also have concerns about GAO cost and schedule
assertions. We have worked hard to reconcile the independent
estimate with the program estimate. Early in the cost
estimation efforts the two estimates did diverge in several
areas due to differing assumptions. As a part of the
reconciliation process, the program estimate has, in fact,
increased, and the independent estimate has decreased. The
estimates are now within 12 percent of each other.
The independent estimator has indicated that the program
estimate represents a reasonable cost estimate at this stage of
the development. The updated cost estimate is, in fact,
informing our 2009 budget process.
Additionally, the independent estimator has also indicated
that the two schedules are essentially in agreement with each
other within the capability of current modeling, schedule
estimating models to predict.
In concluding, I want to take the opportunity to thank Mr.
Powner for the recommendations offered. We are taking
appropriate action to respond to the concerns, and I do
appreciate the Committee's continued interest in NOAA's
satellite programs. We are strengthening our management of
these programs. We do have a fully-functioning, operational
satellite with backup systems in place, and we are pleased to
be working on the next generation GOES-R.
At this point I will be happy to answer any questions you
have.
[The prepared statement of Ms. Kicza follows:]
Prepared Statement of Mary Ellen Kicza
Introduction
Mr. Chairman and Members of the Subcommittee, I am Mary E. Kicza,
Assistant Administrator of the National Environmental Satellite, Data,
and Information Service (NESDIS). NESDIS is part of the National
Oceanic and Atmospheric Administration (NOAA), within the Department of
Commerce (DOC). I appreciate the opportunity to discuss with you today
NOAA's environmental satellite programs and to highlight their
importance to our hurricane and other severe weather forecasting and
warning capabilities. NOAA has made significant progress in the
development of the next generation Geostationary Operational
Environmental Satellites-R Series (GOES-R) program since the September
29, 2006 hearing.
NOAA's satellite acquisitions are complex and difficult development
efforts. I will be the first to acknowledge that NOAA does not have a
strong track record with regard to recent satellite acquisition
development efforts. We appreciate the Government Accountability
Office's (GAO's) recognition that, in the GOES-R acquisition,
``progress has been made.'' NOAA is working hard to prevent schedule
and budget problems from occurring in our satellite programs. We have
implemented several changes to strengthen the review, cost estimating
and program control processes within our satellite development programs
in response to lessons learned from programs including the National
Polar-orbiting Operational Environmental Satellite Systems (NPOESS) and
from the recommendations of outside reviewers, such as the GAO.
We value the GAO's reviews of GOES-R. In fact, GAO's
recommendations place emphasis on some areas where NOAA is already
proactively engaged: obtaining an independent cost estimate and
reconciling differences with the program cost estimates; assuring that
we are paying proper attention to managing risk; and putting in place
protocols similar to those used by the National Aeronautics and Space
Administration (NASA) for milestone decision points for satellite
acquisition programs. We thank the GAO for its recommendations and look
forward to its continued review of the program.
What are Geostationary Satellites?
NOAA has operated geostationary operational environmental
satellites (GOES) since the 1970s. These satellites are located more
than 22,000 miles above the equator and provide near continuous images
and data on atmospheric, oceanic, and climatic conditions over the
continental United States and Hawaii. These satellites are best known
for creating the hurricane pictures you see on television, but they
also provide the data to help forecast the weather and are critical to
detecting and tracking severe weather. Advances in hurricane prediction
depend not only on improved observations such as those from satellites,
but also on improved data assimilation, computer models, and continued
research to better understand the inner workings of hurricanes.
We operate two geostationary satellites, one over the east coast
and the other over the west coast. To protect against a loss of
satellite coverage, we maintain a spare satellite in space that can be
repositioned and brought out of storage in a matter of hours to take
the place of a failed satellite. Given the importance of these
satellites, continuity of operations remains our highest priority.
What is GOES-R?
Individual GOES satellites have a letter designation through their
development until they are launched, placed in orbit, and have
completed a rigorous checkout procedure. They are then given numeric
designations for their operational lifetimes. The operational
satellites in space now, GOES-11 and GOES-12, are the last two
satellites of the GOES I-M series. The next series of geostationary
satellites is called GOES-N, and this series consists of the same
instruments as the GOES I-M series. The first of the GOES-N series
satellites was launched in May 2006 and is currently serving as the on-
orbit spare. The final two satellites from this series--GOES-O and
GOES-P--are already built and will be launched over the next several
years. We are still in the preliminary design phase of development for
the next generation of GOES satellites, called GOES-R, which will
ensure uninterrupted satellite data continuity when the GOES-N series
ends. Current assessments indicate that GOES-R must be launched at the
end of 2014 to provide continuous geostationary data. The GOES-R series
will include advancement beyond the GOES-N series, particularly in
instrument capability. GOES-R will provide forecasters and scientists
with a new suite of greatly improved instruments. These new instruments
will enhance our current capability to track and monitor severe weather
on Earth with greatly improved imagery and scan rates. Solar
environmental monitoring instruments will provide a significant advance
for space weather forecasting.
We have committed, during the preliminary design phase of GOES-R,
to thoroughly examine the program to confirm its readiness to proceed
into the acquisition phase. This has involved changing the management
and acquisition strategy, implementing regular senior NOAA and NASA
reviews of the program, and subjecting the program to independent
review and cost estimates. These efforts are yielding valuable results
by identifying areas that require additional attention and providing
the appropriate resources to address those areas. We believe we are on
a sound track going forward.
Status of GOES-R
During 2006 and 2007, NOAA and NASA conducted a top-to-bottom
review of the program with input from an Independent Review Team of
senior satellite acquisition experts, the user community, and reports
from the three preliminary design contractors. These efforts led to a
revision of our plans to ensure we have a program that maintains data
continuity, allows for technical advances, and is affordable.
Specifically, we had to acknowledge that to actually build our concept
for GOES-R would be much more expensive than we first thought. As a
result, we made the decision not to award a contract to build the
Hyperspectral Environmental Suite given its risk and technological
challenges. In addition we made a decision in March 2007 to change the
program management structure to take advantage of the unique
organizational expertise of NOAA and NASA. NASA has a long history of
managing successful satellite acquisitions, while NOAA has a long
history of developing successful ground systems for operational weather
satellites. This change incorporated important lessons learned from
other major systems acquisitions projects. Key elements of the new
management strategy are:
NOAA has overall program responsibility and total
program funding.
NASA manages development of spacecraft and
instruments, and provides launch services.
NOAA manages development of ground systems and
operates the system on orbit.
NASA leads government systems engineering,
integration activity and mission assurance.
For each of the GOES-R program projects (ground,
flight, and integration) NOAA and NASA partner closely, with
NOAA staff providing direct support (i.e., as deputy program
managers) to NASA-led elements, and vice versa.
We also changed our acquisition strategy to align with the new
management strategy by replacing the single, prime contract approach
with two primary contracts, one for the space segment and one for the
ground segment. The combination of the new management and acquisition
strategy will reduce program risk and maximize our potential for
fielding a high performing satellite system on schedule and within
budget. To document this management change and other major aspects of
the program, NOAA and NASA signed a Memorandum of Understanding in June
2007 and will shortly implement detailed operating procedures
documented in the GOES-R Management Control Plan (MCP). The MCP,
patterned after a NASA Program Plan, will implement the current NOAA/
NASA program management practices and guide responsibilities of NOAA
and NASA for the GOES-R Program.
NOAA has benefited from the 2005 decision to create a jointly
staffed NOAA/NASA program office at the Goddard Space Flight Center.
Prior to 2005, NASA conducted all of GOES acquisition activities for
NOAA, and NOAA maintained a small liaison staff at the Goddard Space
Flight Center. Collocation of NOAA and NASA program personnel at the
Center facilitates communication between the flight and ground
projects, permits effective joint program systems engineering and
integration, and encourages a collaborative NOAA/NASA team environment.
NOAA and NASA personnel work side-by-side. The overall GOES-R program
management team has access to the satellite acquisition expertise and
experience in place at Goddard Space Flight Center, including
engineering and program management reviews of GOES-R.
Status of Spacecraft and Ground System Acquisition
To prepare for the 2008 spacecraft source selection, a joint NOAA/
NASA team is reviewing industry responses to a draft Request for
Proposals (RFP) received in mid-September. The spacecraft project has
successfully concluded the review which allows the Request for
Proposals to go forward. We are now in the process of finalizing the
RFP. At present, four instruments are currently in the implementation
phase, one (the geostationary lightning mapper) is nearing
implementation and the sixth (the magnetometer) will be procured as
part of the spacecraft acquisition. Instruments will be delivered to
the spacecraft contractor as government-furnished equipment for
integration on the spacecraft. Appendix 1 provides a list of the
instruments and their status.
The ground project is nearing completion of the reviews necessary
to allow the project to go out for proposal. We anticipate a draft RFP
for the ground segment will be released in January 2008. NOAA and NASA
are working towards releasing the final spacecraft and ground RFPs in
early 2008. NASA and NOAA will release the final spacecraft and ground
RFPs following appropriate NASA and NOAA/DOC reviews and approvals.
Since the GAO issued its report in September 2006, the Independent
Review Team has met twice to provide recommendations to NOAA concerning
program readiness for the acquisition phase. The GAO's most recent
report indicates that, while NOAA and NASA are taking the right steps
to put together a sound GOES-R Program, there is still work to be done
before proceeding into the acquisition phase, especially in the ground
system. Identifying and addressing issues before the acquisition phase
begins is a key lesson learned from the NPOESS program. Once we begin
the acquisition phase and the contracts are in place, the workforce
engaged in implementing the program ramps up sharply. Fixing problems
during the acquisition phase is more costly given the larger workforce
involved. That is why it is so important to take the time to identify
and address the problems during the program definition phase. We want
to enter the acquisition phase with a program that will succeed with
all risks appropriately identified and tracked.
Status of the Cost Estimate
NOAA has hired outside experts to develop the program cost
estimates. This cost estimating team works for the GOES-R program
office and is developing the Program Office Estimate. In addition, we
have hired an independent team to examine the Program Office Estimate.
This independent team works for the NOAA Chief Financial Officer and
has provided an Independent Cost Estimate. The Independent Cost
Estimate group and the GOES-R Program are actively working to clarify
assumptions and understand the differences in the cost estimates
developed through their review.
The GAO Report
GAO has provided regular reviews of our GOES-R Series acquisition
for many years and we appreciate the perspective that the GAO
professionals provide. We have met with GAO and provided information
and feedback on its most recent report. I will summarize this
information for you today.
I am pleased that the GAO report recognizes we have taken steps to
apply the lessons learned from other satellite programs to the
procurement of GOES-R. I understand we have more work to do to improve
the overall management of these complex and high risk programs, and the
joint NOAA/NASA team is fully committed to making further improvements.
Specifically, the GAO provided two recommendations related to
program-wide risk:
21Recommendation number one: Ensure that the GOES-R Program Office
manages, mitigates and reports on risks using a program-level risk list
that is reconciled with and includes risks from both flight and
operations project offices that could impact the overall program.
NOAA agrees with the recommendation and has directed the GOES-R
Program Office to maintain a consolidated program-wide risk list and
use this list in internal and external reviews of the program. The
GOES-R risk management process includes regular review of project risks
by the program and selective elevation of project risks at the program
level for mitigation and management. The System Engineering and
Integration Division of the GOES-R Program is responsible for
maintaining the program risk list which is reviewed at least monthly by
the GOES-R System Program Director. The GOES-R System Program Director
briefs the NOAA Program Management Council monthly on the top risks and
the strategies for resolving and closing them.
Recommendation number two: Include the following risks on the program-
wide risk list, develop plans to mitigate them and report to senior
executives on progress in mitigating them:
- Unfilled or temporary GOES-R program leadership positions,
- Insufficient program insight on NASA contract performance,
and
- Insufficient management reserve on the critical Advanced
Baseline Imager instrument and at the GOES-R program level.
NOAA agrees with the need to track the leadership positions and has
a structured process in place to do so. The status of the filling these
vacancies is reviewed at the monthly Program Management Council
meetings. On an acting basis, the GOES-R program is being led by two
highly qualified individuals with multiple years experience in
satellite and major systems acquisitions. NOAA has requested that the
NOAA Workforce Management Office expedite a nationwide advertisement
and search for a permanent GOES-R System Program Director.
NOAA realizes that to have the necessary insight into NASA contract
performance it is not simply sufficient to have co-located and
intermingled staff. That is why NOAA and NASA are drafting a
comprehensive Management Control Plan that will establish the framework
for Program and Project performance. NOAA will assure that the
finalized Plan provides NOAA a sufficient degree of insight and
guidance to meet NOAA's responsibility for mission success.
Finally, NOAA does not agree with the assertion that there are
insufficient reserves on the Advanced Baseline Imager instrument and at
the GOES-R program level. It is important to note that the funding
level used by GAO as the baseline for this evaluation is not the same
amount that NOAA actually budgeted for this instrument. NOAA budgeted
more funding than the contract amount, and withheld the difference as a
management reserve at the GOES-R program level, rather than in the
specific instrument budgets. While at the time of the GAO review in
March through August, the GOES-R Program had not allocated this
management reserve to the projects, the reserve funding has now been
allocated and is sufficient to manage the anticipated program risk. The
GOES-R Program currently maintains reserves at the Program level and at
the Flight and Ground Project levels. The System Program Director holds
the project managers responsible for managing their projects and
reserves. The current level of management reserve for the Advanced
Baseline Imager at the program and project levels are sufficient.
While not a recommendation, GAO has asserted the following in the
body of the report: ``. . . independent estimates are higher than the
program's current cost estimate and convey a low level of confidence in
the program's schedule. Independent studies show that the estimated
program could cost about $2 billion more, and the first satellite
launch could be delayed by two years.''
NOAA strongly disagrees with this statement and is currently
working with the program and independent cost estimators to resolve the
differences. It is critical that this assertion be put into its proper
context. Early in the cost estimation effort, the program office and
independent estimates were divergent in several areas due to differing
assumptions, which is not uncommon for programs of the magnitude of
GOES-R. Accurate comparison of the two cost estimates requires an
assessment of each estimate's ground rules and assumptions. Resolution
of issues related to instrument design complexity, software scope, and
inflation factors can have huge effects on revised estimates. As work
with the independent estimator has progressed, we have resolved
numerous differences in ground rules and assumptions and have seen the
two cost estimates begin to converge. We expect to achieve even closer
convergence as we continue to resolve the remaining differences in
assumptions.
As with the two cost estimates, the reconciliation efforts
associated with the schedule estimates have identified some key
assumption differences that should result in some convergence in the
schedule estimates. However, it should be noted that the two schedules
essentially agree with each other (within the capability of current
schedule estimating models to predict).
Conclusion
I appreciate the Committee's continued interest in NOAA's satellite
programs. It is widely acknowledged that satellites are very
complicated and difficult systems to design, build, and operate.
However, their capabilities play a role in NOAA's mission to observe
and predict the Earth's environment and to provide critical information
used in protecting life and property.
We are making significant strides in developing a better process
for designing and acquiring our satellites. We have fully functioning
operational satellites with backup systems in place, and we are working
on the next generation that will provide significant improvements in
our ability to forecast the weather. I would be happy to answer any
questions you may have.
Appendix 1
GOES-R Instrument Status
Advanced Baseline Imager (ABI)
- Implementation phase
- Contractor: ITT Corporation, Fort Wayne, IN
Space Environmental In-Situ Suite (SEISS)
- Implementation phase
- Contractor: Assurance Technology Corporation, Carlisle, MA
Extreme Ultra Violet/X-Ray Irradiance Sensor (EXIS)
- Implementation phase
- Contractor: Laboratory for Atmospheric and Space Physics,
Boulder, CO
Solar Ultra Violet Imager (SUVI)
- Implementation phase
- Contractor: Lockheed-Martin Advanced Technology Corp, Palo
Alto, CA
Magnetometer
- To be procured as part of spacecraft contract
Geostationary Lightning Mapper (GLM)
- Contract to be awarded Fall 2007
Biography for Mary Ellen Kicza
Mary Ellen Kicza is the Assistant Administrator for Satellite and
Information Services. Before coming to NOAA, Ms. Kicza served as the
Associate Deputy Administrator for Systems Integration at NASA. As a
senior leader within NASA, she was responsible for assuring that
mission and mission support elements were effectively aligned and
integrated to execute NASA's vision and mission.
Over the course of her career, Ms. Kicza has served with
distinction in a variety of technical, managerial and leadership posts
in which she has been involved in the development, launch and support
of satellite systems as well as multi-faceted research and development
programs. In these roles, she has acquired extensive experience, not
only in executing scientific and engineering programs but also in
strategic planning, budget formulation, and workforce and facilities
planning. In addition, she has significant experience in building and
maintaining effective relationships with the Office of Management and
Budget, the Office of Science and Technology Policy, the Defense
Department, Congress, the aerospace industry and a diverse research
community.
Ms. Kicza's accomplishments have won her two SES Meritorious
Service Awards, NASA's Distinguished Service and Scientific Achievement
Medals, and numerous other awards. Ms. Kicza began her career as an
engineer at McClellan Air Force Base in California, developing and
testing software for Air Force satellite communications systems. In
1982, Ms. Kicza joined NASA's Kennedy Space Center where she served as
a lead engineer, participating in the preparation of Atlas Centaur and
Shuttle Centaur launch vehicles in support of NASA, DOD and NOAA
satellites.
Since that time, Ms. Kicza has served as a program manager, as
Deputy Director of the Solar System Exploration Division, Assistant
Associate Administrator for Space Science, Associate Center Director
for Goddard Space Flight Center, and Associate Administrator for
Biological/Physical Research. In these roles, Ms. Kicza led and managed
large, complex ground-based and space flight programs, many of which
are international in scope, in support of U.S. space and earth science
programs. As the Associate Center Director at Goddard, she managed a
diverse scientific and engineering community of approximately 3,100
civil servants and 6,000 contractors. Ms. Kicza received her Bachelor's
Degree in Electrical and Electronics Engineering from California State
University, and a Master's Degree in Business Administration from the
Florida Institute of Technology.
Discussion
Chairman Lampson. Thank you very much, Ms. Kicza. We have a
vote. I don't know why we have that goofy alarm. Somebody made
the decision they liked it, I guess.
We are going to continue to go forward and see how far we
can get through this. So let me begin with Mr. Powner.
GOES Program Costs
NOAA uses an 80 percent confidence level in its cost
estimating. My understanding is that leaves a 20 percent chance
that the quoted cost will be exceeded. So the cost numbers
reported for GOES represents floors, not ceilings. Right?
Mr. Powner. Correct. Well, there is a chance that, at an 80
percent confidence level, there is a 20 percent chance it
actually could go up or down is really what it says. So it is
always going up, so correct.
Chairman Lampson. Does the estimate give a limit to the
possible program costs?
Mr. Powner. It does not give a limit. No.
Chairman Lampson. Ms. Kicza, according to the comments NOAA
submitted to GAO, the most conservative estimates at the 80
percent confidence intervals bring the program office estimate
within 12 percent of the Independent Cost Estimate (ICE) or
$1.032 billion below the ICE. The ICE is $9.3 billion. This
implies that the program office estimate is now $8.3 billion.
This is a billion dollars above NOAA's estimate at last year's
hearing.
Can I assume that this will be the cost estimate reported
in the President's budget estimate in February?
Ms. Kicza. No, sir. I am not sure how you are working your
math, but right now our current program office estimate is
between $7-$8 billion, and that is within the 12 percent of the
current independent estimate. I believe the independent cost
estimate numbers came down from what you may have earlier
quoted.
Chairman Lampson. Where will we find that additional--last
year it was seven, and it is going to be----
Ms. Kicza. We are at $6.9 billion with President's FY 2008,
budget, and as we had indicated last year we still had to go
through the Independent Cost Estimate and reconcile. And that
is, in fact, the process we are going through.
Chairman Lampson. Okay. So that number is going to be a
higher number. Will that----
Ms. Kicza. The number that we are dealing with now is the
current program office estimate, is higher than the $6.9
billion. It is between $7-$8 billion, and it is part of our FY
2009 discussions.
Chairman Lampson. And that will be in the President's
budget in February?
Ms. Kicza. Yes, sir.
Chairman Lampson. Will NOAA be getting the additional money
to cover that?
Ms. Kicza. As I have indicated, we are in dialogue with the
Administration on what we believe is an appropriate budget for
the GOES-R Program. I think we have good rationale for
indicating the need for the additional budget. We are budgeting
at the 80 percent cost confidence level, and we think that is a
reasonable approach to take at this stage of the program.
Chairman Lampson. Mr. Powner, in your experience, which of
the cost estimates is the most believable and why?
Mr. Powner. Well, if you look at it from a historical
perspective and just to clarify this, there is, right now at
$6.9 billion and the independent cost estimate was at $9.3
billion. And that is in our report, and you can see allegations
that NOAA disagrees with that statement. All we were reporting
was what the independent cost estimators came up with.
Now, clearly, there is this reconciliation that is going on
right now. No one has seen that. Okay. So we hear it is between
$7-$8 billion. We haven't seen that. Historically if you look
at NPOESS and these other satellite acquisitions, the
independent cost estimate becomes a reality or typically it is
exceeded. So hopefully, we are hopeful that NOAA is right, and
we are at a lower cost, but if you look historically, we are in
the ballpark of the $9.3 billion with the independent cost
estimator.
Chairman Lampson. Do you want to comment?
Ms. Kicza. Yeah. As I had said earlier, I think we all
agree that we should be budgeting at the 80 percent cost
confidence level. That is the right thing to do at this space
in the game, and we particularly want to get a sound cost
estimate before we get the major contractors on board. We have
an 80 percent cost estimate at the program office level. The
independent cost estimator had an 80 percent cost estimate. The
reconciliation process is an approach of understanding the
differences between the two cost estimates, seeing where they
converge, and then coming forward with what we believe is a
rational cost estimate to be presenting in the President's
fiscal year 2009 budget.
We won't exactly reconcile, but for every area that we
don't specifically reconcile on, we will have a good reason for
why we believe our number is the better number.
Chairman Lampson. Mr. Powner, how should Congress react
when it receives these differing cost estimates? How do we
assure that the cost estimating process give us an accurate
estimate of a likely program cost and not an estimate trying to
stay within a figure likely to be approved by the OMB?
Mr. Powner. Well, I think the key is to look at where the
differences lie and whether the assumptions and rationale on
those differences makes sense from an oversight perspective.
Clearly, we don't know exactly where those are at the moment,
but if you look at like independent cost estimators, whether it
is GOES or NPOESS, they typically look at historical data. It
is more heavily influenced by historical data. There is a lot
of other information internal to the program that only Ms.
Kicza and her staff has right now that are driving these
decisions, and I think from an oversight perspective, whether
it is yourself or GAO helping you with that, we really need to
look at those assumptions and whether they are reasonable.
Chairman Lampson. Thanks. Mr. Inglis.
Mr. Inglis. Ms. Kicza, I guess it is, if I am understanding
this right, you think that the independent estimate is $7-$8
billion. Right?
Ms. Kicza. A program office estimate is between $7-8
billion, and it represents what the program believes is a sound
80 percent cost confidence estimate.
Mr. Inglis. And the independent estimate is?
Ms. Kicza. The independent estimate will be a little bit
higher than that, and those areas where there are differences
we will explain the differences and the rationale for why we
believe the estimate that we are coming forward with is a
correct estimate.
I would like to take the opportunity to also say that we
are not trying to bring in an estimate that the Administration
will accept. We are bringing in an estimate that we believe is
a sound estimate to execute the program successfully.
Mr. Inglis. And when will, what is the process by which you
are going to explain those differences? When will that be and
or can you tell us now what the differences are?
Ms. Kicza. I can tell you where the key areas of difference
are. Yes. It is in the amount of maturity of the software, so
you will see some deltas in the software development area. You
will see some deltas in the area of instrument development and
some deltas in the area of systems engineering. In all cases
the program estimate increased its estimate, and I believe we
have a sound basis for the numbers that we have identified in
our estimate.
Mr. Inglis. And when is that, when do you intend to make
those explanations available with specificity?
Ms. Kicza. We can make them available as part of the '09,
budget process, and we are also having that independently
looked at by our independent review team.
Mr. Inglis. Which, I guess, is driving some of the
Chairman's questions about, it sounds like it is connected to
the budget process.
Ms. Kicza. Yes, it is. Absolutely.
Mr. Inglis. But then that you, I guess that brings up the
possibility of being fit into the budget process I think is
the, is at least the theory that the Chairman is pursuing.
And it is not really reflecting what is happening in the
program. It reflects rather that the budget exigencies rather
than the program's natural expenses.
Ms. Kicza. At this point what we have delivered as a budget
that we believe is a rational budget at the 80 percent cost
confidence level, and I have no indication that it would be
anything other than that.
GOES Completion Dates
Mr. Inglis. How about the time estimate differences? The
time to completion. What is, the delivery dates. When, what is
with the discrepancy there? You are thinking that it is going
to be operational when?
Ms. Kicza. We plan to have it available for launch for the
December 2014 timeframe. We have had that looked at both
internal and external of the program. I think it is a rational
launch date to proceed to with sufficient schedule reserve.
What the independent estimator has indicated is that within
the ability of the current models to predict, the two estimates
are essentially the same.
Mr. Inglis. So the independent analysis agrees----
Ms. Kicza. Right.
Mr. Inglis.--with your analysis, 2014?
Ms. Kicza. Within the ability of models to predict. So they
are saying it could be as much as a year later than what we
are, but the models are not, they don't have a high enough
fidelity to be able to discern between those two dates.
Mr. Inglis. So you are saying 2014. They may be saying
2015.
Ms. Kicza. Yes, sir.
Mr. Inglis. I wonder where I get the 2017 number. Do you
have any idea?
Ms. Kicza. It was an earlier point in the independent
process. So through the reconciliation process we have reduced
that delta.
Mr. Powner. Can I clarify that?
Mr. Inglis. Yeah.
Mr. Powner. 2014, $6.9 billion, 2014, was the current
estimate. The independent assessors came up with the $9.3
billion cost and then about a two-year delay into the 2017
timeframe. So when we heard back from NOAA on our report, what
they told us that they anticipated instead of a $2 billion
overrun and a two-year delay, a $1 billion overrun and a one-
year delay. Now, today we are hearing a 2014, delivery. So we
are a little confused because the one time we were $2 billion
more and two out, and then they replied back one billion more
and only one out instead of two. And today I am hearing 2014.
So we probably need to get that cleared up.
But what we have was an original estimate of 2014, in the
independent assessment and the rest of this is just kind of in
the fog, Ranking Member Inglis, because we don't see any data
on that.
Ms. Kicza. What I will clarify is what we provided back is
where the independent estimate is coming in versus what I have
been talking about as the program estimate. The independent
estimate went from $9.2 billion and two years down within, to a
one-year beyond where we are estimating. Similarly, both in
cost and schedule, the independent estimate through the
reconciliation process has come down, and from our perspective
the program office estimate in terms of cost has increased in
part of the reconciliation process.
Mr. Inglis. Thank you, Mr. Chairman.
Chairman Lampson. Okay. We have only a couple minutes left
before our vote. We will have to be in recess until we make
those votes. There are three, one 15-minute, which is almost
over, and two fives, so we will be coming back, and we are in
recess.
[Recess.]
Ms. Giffords. [Presiding] Good afternoon. I don't look like
Nick Lampson, but I am Gabrielle Giffords, and this meeting is
officially resumed.
GOES-R Procurement
Just following up on the Congressman's questions, this
question is for Ms. Kicza. Has NOAA yet made a final decision
to purchase the GOES-R?
Ms. Kicza. I think it is very important to remember that we
are still in the formulation phase for GOES-R. This is the time
when we are trying to settle on the cost, the scope, and the
schedule. We have not yet made the decision to go out and
procure those major contracts for ground and space segments. We
are approaching that decision now.
Investing in New Satellites Technologies vs. Reopening Existing
Satellites
Ms. Giffords. Okay. And a pretty basic question. With what
we know now is it better to invest the limited resources for
geostationary weather satellites by reopening the line of
existing satellites, expensive though it may be, or to continue
with the developing of the new technologies with GOES-R with
the threat of the constantly rising costs that could possibly
leave us without those improved capabilities?
Ms. Kicza. That is a really good question, and in fact,
when we were going through our series of options that we were
examining last summer as a part of this effort, we looked at
whether or not it would be cost effective to look at simply
duplicating the GOES-N series, which is the current line. And
what we found is that because of the mission design life for
that series, you would have to buy three spacecraft, where with
GOES-R you have to buy two. You would not have the capability,
but it would be a comparable cost. And it would still require
the same approach. You would still have to go out with a new
procurement.
So we didn't see any schedule benefit, no cost benefit, and
we would lose the cost we had already sunk into the development
for GOES-R.
Managing GOES and NPOESS Costs
Ms. Giffords. There is also reality that NOAA is already
struggling with a second highly-complex satellite program, the
NPOESS, and the level of resources does not appear to be able
to meet the real needs of both programs simultaneously. What,
therefore, is the best course of action to pursue, assuming
that there is no sudden influx of or increase of funds for
NOAA?
Ms. Kicza. Well, right now the NPOESS Program, the Polar
Orbiting Satellite Series, is a joint program with NOAA and
DOD. We each share half of the costs of that development, and
it is fully funded at this point in time. The only area where
we are working for an updated cost estimate is on GOES-R.
Both satellite series are needed to support our operational
weather forecasting capability.
Ms. Giffords. Let me just get the clarification. So you
believe that you can accomplish both with the funds that you
currently have available to you?
Ms. Kicza. We are increasing the cost estimate for GOES-R,
and the NPOESS Program is currently fully funded.
Ms. Giffords. And how much is that increase going to be
for?
Ms. Kicza. We have indicated that it is, right now we are
at $6.9 billion. The increase is between, to bring it up
between $7-$8 billion.
GAO Recommendations
Ms. Giffords. Mr. Powner, with all the work that you have
been asked to do in your area, what would you offer some
recommendations to deal with this conundrum?
Mr. Powner. A couple key areas that I would like to
highlight in terms of perhaps where we have had some
disagreements is on the management reserve. It is early stage
of this program. I think if you look at the independent review
team recommendations on GOES, the recommendation is that we
have a 25 percent management reserve. That was the target.
When we completed our report, the management reserve had
decreased for the program now, overall, down to 15 percent. We
heard today it is now back up to 15 with the renegotiating of
numbers. It is important that we maintain an adequate
management reserve, because there is a lot of technical
complexity involved here, and that really needs to be looked
at.
The other thing that we feel strongly about, and we have
had some disagreements, Ms. Kicza and I have discussed this, is
the insights into NASA's activities. Historically, that has
been a problem on these prior GOES satellite acquisitions. We
have heard this morning, this afternoon that there is
unparalleled transparency in the two agencies that are working
together.
Well, but also when I read Ms. Kicza's statement, I see
comments in here that there are frameworks being established so
that we can have the appropriate insight and guidance. We still
need to work on that and make, keep that on our radar screen to
make sure we have adequate insights into NASA's activities.
Ms. Giffords. Mr. Powner, would you recommend more Q GOES
satellites or go forward with the GOES-R?
Mr. Powner. That is a very good question. Two things. We
would need to see two things in order to answer that question.
One, we would want to know exactly what the cost of GOES-R is
to be. We hear it is between $7-$8 billion. We hear that an
independent cost estimator says it could be as high as $9.3
billion. Historically those independent estimates have come
true. Resurrecting the prior Q satellite, you know, we hear
that you have to, we understand you have to start assembly
lines and the whole bit, but exactly what that would cost, we
don't have any firm numbers. So you would need that cost, the
actual cost of GOES-R, and have a true cost benefit analysis to
determine what is best going forward.
Ms. Giffords. And when do you think we are going to have
those numbers by?
Mr. Powner. Well, what we have heard this afternoon is we
will not have a current GOES-R estimate until the President's
budget comes out in the February timeframe. In terms of
resurrecting the Q option, I don't believe that that is in the
works right now.
Ms. Giffords. Congressman Inglis, I am going to turn the
questions over to you.
GOES Acquisition Strategy
Mr. Inglis. Thank you, Madam Chair. Let us see. Ms. Kicza,
in your testimony and the testimony of Mr. Powner, you
mentioned the splitting of the acquisition contract into a
flight segment and a ground segment. And what was the rationale
behind splitting the two aspects of the acquisition and
contract?
Ms. Kicza. Okay. Over the course of the last year we have
done a lot of examination, examination of the current
contracting structures resident with NOAA, examination of
recent reports, both IG and GAO about the pros and cons of
different contracting strategies, and we had our own
independent review team led by Tom Young, who offered
recommendations. We made the decision to go from a single
systems prime to split contracts to assure that we had
government oversight on every key element of the GOES-R System;
the spacecraft the ground systems, and the instruments.
We believe, and that is also very consistent with the way
our primary partner, NASA Goddard, has traditionally done this
type of acquisition. So the acquisition allows us to benefit
from each agencies' core competencies. It is consistent with
our partner's traditional use, and it provides direct
government oversight on all the key elements.
All of those we felt were reasonable reasons to proceed
with a change in the contracting and management strategy.
Mr. Inglis. And GAO says the splitting of the contracts
caused delays in the program. Do you find that to be the case?
Ms. Kicza. We did have some delay as a result, about three
to six months in terms of extending the current PDRR\1\
contract so we could get additional information, and then
revving up our own capability internally.
---------------------------------------------------------------------------
\1\ Program Definition and Risk Reduction
---------------------------------------------------------------------------
So, yes, we did have some delay as a result of that. We
also uncovered some things that I think we would not have
otherwise seen and have been able to take action in preparing
for the major acquisitions.
Mr. Inglis. Mr. Powner, you have any comment on those
things?
Mr. Powner. The only comment is that the short delay
extending the awarding of those contracts, that probably makes
sense because those preliminary design reviews and those
meetings for those key decision points are very critical going
forward. I think historically when you look at NPOESS a lot of
times we push decisions through rather quickly instead of
actually having a real solid design review in the critical
technical reviews prior. So that delay makes sense.
Mr. Inglis. Ms. Kicza, Ms. Giffords was just mentioning the
Q line and the possibility of resurrection, resurrecting that
line. Is that current technology, or is it outdated technology?
Ms. Kicza. Let me talk a little bit about that. The
original series N, O, and P was an N, O, P, Q. We had planned
for four satellites. In 2003, we made the decision not to
exercise that option on that procurement and for good reasons.
We ended up getting a more powerful launch vehicle that allowed
us to extend the lifetime of the N, O, P spacecraft. That
option is no longer available to us. We would have to go out
with a separate procurement. So we would have to go out and
procure new spacecraft. The instruments aren't there. We would
have to go build new instruments again, and so we didn't find,
and we would have to build three spacecraft as opposed to two
spacecraft, which is what we have got with the 10-year mission
life on GOES-R.
We went through that analysis last year as part of the
decision to go from four to two. We did a wide number of
options on where we should go and the continuity of the N
Series was one of the options that we examined.
Contractor Performance
Mr. Inglis. Thank you. I have no further questions.
Ms. Giffords. Mr. Powner, your report seems to state that
NOAA can't discuss both the cost and also the schedule data
directly with contractors on the space segment. Why do you
think that the GAO considers that such a significant issue?
Mr. Powner. Well, I think there are processes that are
currently being established right now so that NOAA does have
insights into the, what is going on from the NASA component of
this. That is very important. If you look, for instance, if you
look, if you compare this to the NPOESS Program where we have
joint program with NOAA and DOD and the scrubbing of some of
the cost and schedule data from the contractors, that has
proven a very effective best practice, even down to the point
where they scrub that data on a weekly basis, and they get
ahead of the curve and anticipate problems with both costs and
schedule.
Something like that would be a good model to consider with
the GOES Program.
Ms. Giffords. Ms. Kicza, did the management documents that
you described in your testimony give NOAA, the managers, the
authority to obtain any data they believe is needed to manage
the GOES-R Program?
Ms. Kicza. Yes. In fact, the way the program is structured,
the program office manages the cost data that comes in, and we
matrix that support into the project. So we have complete
insight into what is going on with the contracts, who they are
performing in terms of cost and schedule.
I agree with David that we really need to keep a close eye
and a firm handle on insight into how the contractors are
performing. I believe we have that at his point in time. We
were talking about it before we started the hearing. We have to
make sure that we keep our eyes on it. We don't let the, you
know, let it get out of our sight, because then it should
become a risk. Right now I personally don't believe it is a
risk because we do have eyes on it.
And so that was my rationale for not agreeing. It is not to
say it is not important to keep a good close eye on how the
contractors are performing, whether that be on the space
segment side, which is NASA's, or on the ground segment side,
which is NOAA's.
Ms. Giffords. One final question. The disagreement in your
statements considering management of program reserves, to me
focuses on how the reserves are distributed, but isn't it
really a question of whether there will be sufficient reserves
to carry the program to its conclusion?
Ms. Kicza, you said that it will, but Mr. Powner says that
the Advanced Baseline Imager already made a hefty call in
reserves and still has 40 percent of its work remaining. Should
this committee be concerned that you will run out of reserves
as happened with the NPOESS Program?
Ms. Kicza. As I had indicated in my testimony, right now we
are developing an estimate or have an estimate which keeps 25
percent management reserve overall on the program. In fact,
more than that. We have, at the time that Mr. Powner's team was
looking at it, they did not see that reserve posture because we
had not allocated it down to the project. So they saw a small
amount of reserve on the instrument contract. They saw no
reserve at the project level.
Since that time we have allocated reserve. We have 25
percent on the flight project, 30 percent on the ground
project. We require the flight project manager to maintain a
minimum of 20 percent unliened reserve on cost to go, and we
actually visually check that on a monthly basis at my level. I
can see where his liens are and whether or not he is keeping
that threshold that we think is best business practices.
Ms. Giffords. But is the total reserve left to carry
through, it is going to be left to carry through to the next
program?
Ms. Kicza. No. It is not going to carry through. The reason
you put reserve on the programs is you expect you will spend it
by the time you launch. But you always want to have it there
because you, when you need it, you need to have ready access.
Ms. Giffords. Okay. But it is going to get us to the launch
then?
Ms. Kicza. Yes, absolutely, and beyond. We have reserve
posture for the operational, operation of those satellites as
well.
Ms. Giffords. Okay. Let me just follow up with one last
question. Does the contractor for the Advanced Baseline Imager
have any of its own money set aside to reserves?
Ms. Kicza. The contractor does keep a small reserve, but
traditionally with the way NASA manages contracts, they tend to
keep very little reserve in the contract, and they hold it at
the project level, and then they control the allocation back to
the contract when it is time to do so.
Ms. Giffords. Do we know how much of that reserve exists?
Ms. Kicza. As I said, right now they are at 25 percent, and
they are expected to keep 20 percent unliened on cost to go,
and that is being maintained.
Recent Congressional Actions
Mr. Inglis. I have just one more question, Madam Chair, and
that is, Ms. Kicza, the Senate included language in the CJS
appropriations bill that would require a Nunn-McCurdy type
review for NOAA in the event of cost overruns, and the House
passed similar language in the last Congress, but there is some
differences between those provisions. And maybe you could tell
us how those provisions would affect NOAA's ability to manage
programs like GOES.
Ms. Kicza. Yes, and actually I appreciate the question.
First of all, I want to indicate that I appreciate that type of
Congressional oversight, and I think it is entirely appropriate
for Congress to hold us accountable to deliver spacecraft on
cost, on schedule, and within program scope.
As you noted, the Senate has an amendment out, the House
has recently passed an amendment relative to NASA. I would like
to indicate that the Senate amendment does pose some
difficulties for us.
First of all, it would propose baselining the program at
last year's cost estimate. Typically in spacecraft acquisition
you baseline a program in terms of performance measurements and
measuring against baseline at the time of PDR.\2\ We are not
there yet. We are about a year and a half away from that.
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\2\ Preliminary Design Review
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I fully expect to be baselined and measured against
baseline. We need to make sure it is the right baseline to be
measured against.
The Senate amendment also has a prohibition on spending
current and prior year funds until the certification process is
completed. And so they would basically turn off the fund faucet
while we are certifying, in the event we say we are going to
have a cost overrun. That would basically halt the program in
its tracks and prevent us from being able to launch. We are
concerned about that.
We have looked at the NASA language. We find that language
to be more consistent with what we would expect in a satellite
acquisition system, and as I said, from the get go, we expect
to be held accountable for delivering a program.
Mr. Inglis. No further questions.
Ms. Giffords. Ms. Kicza, would you please submit for the
record the following documents? The June 15 memorandum of
understanding between NOAA and NASA for the GOES-R Program,
also the GOES-R management control plan, and the report
submitted from the Independent Review Team to NOAA, except the
January 3, 2007, report that has already been provided?\3\
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\3\ These documents appear in the Appendix.
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Ms. Kicza. Absolutely.
Ms. Giffords. In closing, the Subcommittee would like to
wish fair weather to Captain Garner Yates, who is with us
today, of the NOAA Commissioned Corps, who is retiring from
federal service this Friday. Captain Yates has served as NOAA's
Congressional liaison for satellite issues for a very long
time, and we know that this has not been an easy job in the
past few years, but our staff is going to miss you. And we
thank you for your service to the Federal Government.
I would also like to thank all of you for appearing before
the Subcommittee this afternoon. Under the rules of the
Committee, the record will be held open for two weeks for
Members to submit additional statements and any additional
questions they might have for witnesses. If there is no further
questions, then this meeting is adjourned. Thank you.
Ms. Kicza. Thank you.
[Whereupon, at 3:30 p.m., the Subcommittee was adjourned.]
Appendix:
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Additional Material for the Record