Defense Acquisitions: Greater Synergies Possible for DOD's Intelligence, Surveillance, and Reconnaissance Systems

Defense Acquisitions: Greater Synergies Possible for DOD's
Intelligence, Surveillance, and Reconnaissance Systems
(17-MAY-07, GAO-07-578).

The Department of Defense (DOD) is experiencing a growing demand
for intelligence, surveillance, and reconnaissance (ISR) assets
to provide vital information in support of military operations.
Over the next 7 years, DOD plans to invest over $28 billion in
existing and new airborne ISR acquisition systems. This
represents a marked increase over prior ISR investments. Given
the significant investments, GAO was asked to (1) evaluate
various ISR platforms for potential synergies and assess their
cost and schedule status and the impact of any increases or
delays on legacy systems and (2) assess the effectiveness of ISR
investment decisions. To assess cost and schedule status, we
reviewed programmatic and budget documentation. To evaluate
investment decisions, we collected information on system
capability, mission, and concept of operation and analyzed the
data for similarities.
-------------------------Indexing Terms-------------------------
REPORTNUM: GAO-07-578
ACCNO: A69697
TITLE: Defense Acquisitions: Greater Synergies Possible for
DOD's Intelligence, Surveillance, and Reconnaissance Systems
DATE: 05/17/2007
SUBJECT: Defense capabilities
Defense procurement
Investment planning
Legacy systems
Military aircraft
Military forces
Military intelligence
Procurement planning
Procurement policy
Schedule slippages
Strategic planning
Unmanned aerial systems
Army Future Combat Systems
Global Hawk Unmanned Aerial Vehicle
Predator Unmanned Aerial Vehicle
Warrior Unmanned Aerial Vehicle

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GAO-07-578

* [1]Results in Brief
* [2]Background
* [3]Some ISR Development Programs Have Experienced Problems That

* [4]Cost, Schedule, and Performance Status of Airborne ISR Progr
* [5]Impact of Delays on Legacy Systems

* [6]Aerial Common Sensor
* [7]Global Hawk

* [8]Opportunities Exist for Greater Collaboration across the Ser

* [9]Army and Navy's Collaboration on Fire Scout Has Achieved Eff
* [10]Collaboration on Broad Area Maritime Surveillance Could Yiel
* [11]Collaboration Slow to Occur on Warrior and Predator
* [12]DOD Efforts to Improve Collaboration

* [13]Conclusions
* [14]Recommendations for Executive Action
* [15]Agency Comments and Our Evaluation
* [16]Aerial Common Sensor
* [17]Airborne Reconnaissance Low
* [18]Airborne Signals Intelligence Payload
* [19]Broad Area Maritime Surveillance Aircraft System
* [20]E-10A
* [21]EP-3
* [22]EPX
* [23]Fire Scout (Army)
* [24]Fire Scout (Navy)
* [25]Joint Surveillance, Target, Attack, Radar System
* [26]Global Hawk
* [27]Guardrail Common Sensor
* [28]Multi-mission Maritime Aircraft
* [29]Multi-Platform Radar Technology Insertion Program
* [30]Predator
* [31]Reaper
* [32]Rivet Joint
* [33]Space Radar
* [34]U-2
* [35]Warrior
* [36]Joint ISR Replacement Study
* [37]U-2 Retirement Study
* [38]Airborne ISR Requirements
* [39]Optimization of ISR Capabilities
* [40]Task Force on Integrating Sensor-Collected Intelligence
* [41]GAO's Mission
* [42]Obtaining Copies of GAO Reports and Testimony

* [43]Order by Mail or Phone

* [44]To Report Fraud, Waste, and Abuse in Federal Programs
* [45]Congressional Relations
* [46]Public Affairs

Report to the Subcommittee on Air andLand Forces, Committee on Armed
Services, House of Representatives

United States Government Accountability Office

GAO

May 2007

DEFENSE ACQUISITIONS

Greater Synergies Possible for DOD's Intelligence, Surveillance, and
Reconnaissance Systems

GAO-07-578

Contents

Letter 1

Results in Brief 2
Background 3
Some ISR Development Programs Have Experienced Problems That Have Led to
Cost Growth, Delays, and Additional Investments in Legacy Systems 7
Opportunities Exist for Greater Collaboration across the Services' ISR
Programs 13
Conclusions 18
Recommendations for Executive Action 19
Agency Comments and Our Evaluation 19
Appendix I Objectives, Scope, and Methodology 24
Appendix II System Descriptions 26
Aerial Common Sensor 26
Airborne Reconnaissance Low 26
Airborne Signals Intelligence Payload 26
Broad Area Maritime Surveillance Aircraft System 26
E-10A 27
EP-3 27
EPX 27
Fire Scout (Army) 28
Fire Scout (Navy) 28
Joint Surveillance, Target, Attack, Radar System 28
Global Hawk 28
Guardrail Common Sensor 29
Multi-mission Maritime Aircraft 29
Multi-Platform Radar Technology Insertion Program 29
Predator 29
Reaper 30
Rivet Joint 30
Space Radar 30
U-2 30
Warrior 31
Appendix III ISR Studies Under Way or Recently Completed 32
Joint ISR Replacement Study 32
U-2 Retirement Study 32
Airborne ISR Requirements 32
Optimization of ISR Capabilities 32
Task Force on Integrating Sensor-Collected Intelligence 33
Appendix IV Comments from the Department of Defense 34

Tables

Table 1: Characteristics of ISR Programs Reviewed 5
Table 2: Planned Investment in Airborne and Space ISR Systems from Fiscal
Year 2007 to Fiscal Year 2013 6
Table 3: Causes and Impacts of Cost and Schedule Growth 8
Table 4: Fiscal Years 2004 and 2008 President's Budget for the Army's
Guardrail Common Sensor and Airborne Reconnaissance Low and the Navy's
EP-3 11

Figure

Figure 1: U-2 Retirement and Global Hawk Fielding 12

Abbreviations

ACS Aerial Common Sensor
ARIES Airborne Reconnaissance Integrated Electronics System
ARL Airborne Reconnaissance Low
ASIP Airborne Signals Intelligence Payload
BAMS Broad Area Maritime Surveillance
COMINT communication intelligence
DOD Department of Defense
ELINT electronic intelligence
EO electro-optical
FMV full-motion video
GRCS Guardrail Common Sensor
IR infrared
ISR intelligence, surveillance, and reconnaissance
JCIDS Joint Capabilities Integration and Development System
MASINT measurement and signature intelligence
MMA Multi-mission Maritime Aircraft
MP-RTIP Multi-Platform Radar Technology Insertion Program
OSD Office of the Secretary of Defense
PA&E Program Analysis and Evaluation
RJ Rivet Joint
SAR synthetic aperture radar
SIGINT signals intelligence
SR Space Radar
STARS Surveillance, Target, Attack, Radar System
UAS unmanned aerial system
USAF U. S. Air Force
USD(AT&L) Under Secretary of Defense for Acquisition, Technology and Logistics
USD(I) Under Secretary of Defense for Intelligence
VTUAV Vertical Takeoff and Landing Unmanned Aerial Vehicle

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United States Government Accountability Office
Washington, DC 20548

May 17, 2007

The Honorable Neil Abercrombie
Chairman
The Honorable Jim Saxton
Ranking Member
Subcommittee on Air and Land Forces
Committee on Armed Services
House of Representatives

Over the next 7 years, the Department of Defense (DOD) plans to invest
over $28 billion to develop, procure, and modify 20 major airborne
intelligence, surveillance, and reconnaissance (ISR) systems and maintain
existing systems until the new ones are fielded. This planned investment
represents a significant increase over past ISR investments and comes in
response to threats that have emerged over the past decade and the high
priority commanders have placed on gathering battlefield intelligence.
Over the next 7 years, the Department of Defense (DOD) plans to invest
over $28 billion to develop, procure, and modify 20 major airborne
intelligence, surveillance, and reconnaissance (ISR) systems and maintain
existing systems until the new ones are fielded. This planned investment
represents a significant increase over past ISR investments and comes in
response to threats that have emerged over the past decade and the high
priority commanders have placed on gathering battlefield intelligence.

Given the significant planned investment in ISR and DOD's recent focus on
its acquisition strategy, you asked us to review DOD's ISR acquisition
strategy. Specifically, we (1) evaluated various ISR platforms for
potential synergies and assessed their cost and schedule status and the
impact of any increases or delays on legacy systems (2) assessed the
effectiveness of ISR investment decisions. Given the significant planned
investment in ISR and DOD's recent focus on its acquisition strategy, you
asked us to review DOD's ISR acquisition strategy. Specifically, we (1)
evaluated various ISR platforms for potential synergies and assessed their
cost and schedule status and the impact of any increases or delays on
legacy systems (2) assessed the effectiveness of ISR investment decisions.

To assess the cost and schedule status of ISR systems, we reviewed
programmatic and budget documentation. To evaluate the effectiveness of
decisions for planned investments, we collected information on system
capability, mission, and concept of operation and analyzed the data for
similarities. We also discussed the results of our analyses with officials
at the program office; Army, Navy, and Air Force headquarters; the Under
Secretary of Defense for Intelligence; and the Joint Chief of Staff for
Intelligence. (For more on our scope and methodology, see app. I.) We
conducted our work between June 2006 and April 2007 in accordance with
generally accepted government auditing standards. To assess the cost and
schedule status of ISR systems, we reviewed programmatic and budget
documentation. To evaluate the effectiveness of decisions for planned
investments, we collected information on system capability, mission, and
concept of operation and analyzed the data for similarities. We also
discussed the results of our analyses with officials at the program
office; Army, Navy, and Air Force headquarters; the Under Secretary of
Defense for Intelligence; and the Joint Chief of Staff for Intelligence.
(For more on our scope and methodology, see app. I.) We conducted our work
between June 2006 and April 2007 in accordance with generally accepted
government auditing standards.

In addition to this report, GAO is conducting two related review efforts
for the committee. These efforts will review and report on (1) DOD's
process to set requirements for ISR systems and (2) DOD's process for
integrating unmanned aerial systems (UAS) into ongoing combat operations
in In addition to this report, GAO is conducting two related review
efforts for the committee. These efforts will review and report on (1)
DOD's process to set requirements for ISR systems and (2) DOD's process
for integrating unmanned aerial systems (UAS) into ongoing combat
operations in support of ISR requirements. Two separate reports on these
issues will be provided later in 2007.

Results in Brief

Nearly all of the ISR development programs that we reviewed have
experienced some cost or schedule growth. Cost and schedule growth in
these programs is largely the result of a poor business case or
acquisition strategy that failed to capture sufficient knowledge about the
product technologies and design before committing to the development and
demonstration of a new system. For example, the Global Hawk program--which
experienced a 261 percent cost growth--had significant overlap of
technology maturation, design, and production. Significant delays in the
delivery of some new systems, breaking the investment strategy (for the
new and legacy systems to be replaced) established at the start of these
acquisition programs, have required DOD to make additional unplanned
investments in legacy systems in order to keep them relevant and
operational longer than planned. For example, the termination of the
Aerial Common Sensor development contract resulted in a 5-year delay and
the need to modify three legacy systems to keep them in the field longer
than planned. The cost to keep these systems capable is estimated at $1.4
billion between fiscal years 2008 and 2013, an increase of nearly $900
million over previous estimates to do so. These unplanned investments
represent opportunity costs that could have been used for other needs
within DOD had the original Aerial Common Sensor acquisition strategy been
based on more robust design knowledge.

Among the ISR acquisition programs we reviewed, we found specific cases
where the military services have successfully collaborated to provide
capabilities to the warfighter more efficiently and affordably. For
example, the Army and Navy programs on their own initiative collaborated
successfully on the Fire Scout to use a single contract to buy common
components that can save hundreds of millions of dollars. However, we also
found cases where more collaboration is needed to achieve efficiencies in
costs and schedule and to close gaps in capabilities. For example, despite
similarities in the Air Force's Predator program and the Army's Warrior
program, the two services have resisted collaboration, and the Army
awarded a separate development contract to the same contractor producing
the Predator. Although the Army and Air Force agreed to consider
cooperating on the acquisition of the two systems in January 2006, the
services continue to struggle to agree on requirements. Through
collaboration, the services could leverage knowledge early in the
acquisition process and avoid or reduce DOD costs for design, new tooling,
and manufacturing, and streamline contracting and acquisition processes.
DOD has numerous ISR studies, either recently completed or ongoing, and a
pilot program to investigate portfolio management practices, but there
have been no current actions to gain greater jointness in ISR acquisition
programs.

While DOD has numerous ISR studies, either recently completed or ongoing
and including a pilot program to investigate portfolio management
practices, there have been no substantive actions recently implemented to
gain greater jointness in ISR acquisition programs.

Therefore, we are recommending that DOD (1) develop and implement an
integrated enterprise-level investment strategy approach that draws on the
results of ongoing studies like portfolio management and (2) report to the
defense committees by August 1, 2007, the results of the ISR studies and
identify the specific plans and actions it intends to get greater
jointness in ISR programs. DOD agreed with the first recommendation but
believes that current initiatives will address it. We believe that many of
the ongoing initiatives to achieve a greater integrated investment
strategy approach for ISR are steps in the right direction but are
concerned that they will not go far enough to address the problems that
have occurred in DOD acquisitions for some time now. DOD also agreed to
report the interim status on the portfolio management program by the above
date but suggested moving the suspense date for reporting on the results
of two other pertinent efforts to the end of the calendar year. We believe
a full reporting in December 2007 would be useful if it includes DOD's
detailed plans. However, we believe an interim reporting to the committees
on the results and planned outcomes from completed studies should be
provided to the committees by August 2007.

Background

ISR directly supports the planning and conduct of current and future
military operations. ISR encompasses multiple activities related to the
planning and operation of sensors and assets that collect, process, and
disseminate data. Intelligence data can take many forms, including
electro-optical (EO) and infrared (IR) images, full-motion video (FMV),
images from a synthetic aperture radar (SAR), electronics intelligence
(ELINT), communications intelligence (COMINT), and measures and signature
intelligence (MASINT). These data can come from a variety of sources,
including surveillance and reconnaissance systems that operate in space or
on manned or unmanned systems. Data can also come from systems that are
ground- or sea-based or from human intelligence teams. Table 1 summarizes
the ISR programs that we reviewed, 13 of which are in development. (A
brief description of each of the 20 programs we reviewed is provided in
app. II.)

Table 1: Characteristics of ISR Programs Reviewed

Source: GAO analysis of DOD data.

aThese systems also carry munitions.

bThis is a payload being developed for deployment on the U-2 and Global
Hawk.

cThis is a payload being developed for deployment on the Global Hawk.

dThe E-10A program was a technology development program until it was
canceled in February 2007.

eDevelopment refers to technology or systems development activities.

DOD plans significant investments in airborne ISR systems. For example,
between fiscal years 2007 and 2013, DOD plans to invest $28.8 billion in
the 20 systems we reviewed. (See table 2.)

Table 2: Planned Investment in Airborne and Space ISR Systems from Fiscal
Year 2007 to Fiscal Year 2013

Source: GAO analysis based on DOD data.

aThe Army does not break out Fire Scout costs separately. They are
included as part of Future Combat Systems.

bThe E-10A program was a technology development program until it was
canceled in February 2007.

Congress has also recognized the need in acquiring UAS. For example, it
added funding between fiscal years 2003 and 2005 to enable the Air Force
to accelerate procurement of the Reaper UAS. Over those 3 years, Congress
increased the Reaper budget over $70 million, directing the Air Force to
procure a total of 8 additional air vehicles. Similarly, the Navy Fire
Scout budget was increased by $17 million in fiscal year 2006 to procure 2
additional air vehicles. In fiscal year 2003, the Global Hawk budget was
increased by $90 million, primarily to develop advanced payloads for
signals and imagery intelligence capabilities.^1

Some ISR Development Programs Have Experienced Problems That Have Led to Cost
Growth, Delays, and Additional Investments in Legacy Systems

Nearly all of the 13 airborne ISR programs in development that we reviewed
have experienced some cost or schedule growth. ^2 Cost and schedule growth
in these programs is largely the result of a poor business case or
acquisition strategy that failed to capture sufficient knowledge about the
product technologies and design before committing to the development and
demonstration of a new system. Significant delays in the delivery of some
new systems, breaking the investment strategy (for the new and legacy
systems to be replaced) established at the start of these acquisition
programs, have required DOD to make additional unplanned investments in
legacy systems in order to keep them relevant and operational longer than
planned. Delays in the Aerial Common Sensor (ACS) aircraft have required
DOD to make additional unplanned investments in three Army and Navy legacy
aircraft systems in order to keep them relevant and operational longer
than planned. These additional investments, totaling about $900 million,
represent opportunity costs that could have been used for other needs
within DOD.

Cost, Schedule, and Performance Status of Airborne ISR Programs

Of the 13 airborne ISR programs in development, 1 has experienced
significant cost growth and 9 have experienced schedule delays that range
from 2 months to 60 months. Table 3 summarizes ISR programs that have
encountered problems either in development or as they prepared to begin
the system development and demonstration phase of an acquisition program.

^1The additional funding does not include DOD or service requests for
supplemental funding in fiscal year 2007 or 2008.

^2All of these 13 programs are in technology development, or systems
development and demonstration as defined by DOD Instruction 5000.2,
Operation of the Defense Acquisition System (May 12, 2003). The purpose of
development is to reduce technology risk and to determine the appropriate
set of technologies to be integrated into a full system.

Table 3: Causes and Impacts of Cost and Schedule Growth

Source: GAO analysis of DOD data.

aDue to delays in the Future Combat Systems and Littoral Combat Ship
programs, the schedules for the Fire Scout programs were correspondingly
delayed. These delays could occur again, even if the specific Fire Scout
program was meeting its cost and schedule.

bEPX, the Navy's replacement for its EP-3, was not included because it is
a new program as of February 2007.

Many of these programs began development without an executable business
case and did not have a good acquisition strategy to capture critical
system knowledge at the key decision milestones. Our work on best
commercial practices has shown that before a company invests in product
development, it should develop a sound business case--one that validates
user requirements and determines that the concept can be successfully
developed with existing resources--to minimize the risks associated with
such a commitment. For DOD, an executable business case provides
demonstrated evidence that (1) the warfighter need is valid and that it
can best be met with the chosen concept, and (2) the concept can be
developed and produced with proven technologies, existing design
knowledge, and available funding and time. To implement the business case,
programs must develop a realistic acquisition strategy, one that includes
critical program knowledge--such as technology maturity, system design,
and manufacturing and production processes--at key points in the
acquisition. DOD's acquisition policy endorses a knowledge-based approach
to acquisition and includes strategies to reduce technology, integration,
design, manufacturing, and production risks.^3

Global Hawk is an example of a program that failed to implement best
practices for developing a new weapon system and encountered significant
cost and schedule problems. It initially began with an incremental
acquisition strategy that approached best practice standards for
technology and design maturity. However, after development began the Air
Force abandoned this strategy and radically restructured the program to
develop and acquire a larger, more advanced aircraft that would have
multimission capabilities (both signals intelligence and imagery
intelligence sensors on the same aircraft). This new strategy called for
concurrent technology development, design, test, integration, and
production in a compressed schedule. As a result, the program has been
rebaselined four times, the development schedule has been extended by 3
years, and the program has experienced a substantial contract cost
overrun. Development costs alone have increased over 260 percent. In
addition, unit costs have increased to the point where statutory reporting
thresholds were triggered, requiring DOD to recertify the fundamental
program need to Congress.^4

Impact of Delays on Legacy Systems

The ACS and Global Hawk programs' failures to develop an executable
acquisition strategy have resulted in significant delays in delivering
required capabilities to the warfighter at the time overall investment
decisions were made. These delays will have significant implications for
legacy systems. Specifically, the services must now make difficult
decisions about investing in legacy systems to keep them operational until
the new systems have been developed and fielded.

^3DOD Instruction 5000.2, Operation of the Defense Acquisition System (May
12, 2003).

^410 USC S 2433 requires the Secretary concerned to report to Congress
when a program's unit cost increases by at least 15 percent over the
current baseline estimate or increases by 30 percent over the original
baseline estimate and requires the Secretary of Defense to carry out an
assessment of the program and provide written certification to Congress
when a program's unit cost increases by at least 25 percent over the
current estimate or increases by 50 percent over the original baseline
estimate.

Aerial Common Sensor

The Army's termination of the ACS system development and demonstration
contract could have significant cost, schedule, and performance impacts on
three legacy airborne systems in the ISR portfolio--the Army's Guardrail
Common Sensor aircraft (GRCS) and Airborne Reconnaissance Low aircraft
(ARL) and the Navy's EP-3 aircraft. The Army and the Navy had planned a
phased approach to field ACS and retire the legacy systems from the
inventory with a minimal investment in maintaining legacy systems. In the
fiscal year 2004 budget, the Army had planned for small investments in
GRCS and ARL because it expected to begin replacing them with ACS in 2009.
In that same budget, the Navy's request reflected its plan to modify the
EP-3.^5 By the time DOD submitted its fiscal year 2008 budget, both
services recognized the need to keep legacy systems capable because the
ACS development contract was canceled. Therefore, the budget included
funding to keep these legacy systems operational for a longer period of
time.

Since the termination of the ACS development contract, the program has
reverted to a technology development stage as the Army restructures the
program. ACS is scheduled to restart system development and demonstration
in 2009, 5 years later than the initial development decision. Although the
Army has not established a new date for initial operating capacity, that
date is also likely to slip by 5 years to fiscal year 2014. The cost to
keep GRCS and ARL mission equipment viable and the platforms airworthy
during this time is estimated to be $562 million between fiscal years 2008
and 2013, an increase of $550 million over what had been previously
planned. Without these improvements, the systems will not remain capable
against modern threats, possibly resulting in a gap in ISR capabilities on
the battlefield. In addition, the platforms could not continue to fly
during this time frame without increased structural and avionic
modifications.

The Navy had planned to replace its EP-3 with ACS and begin fielding the
new system in fiscal year 2012. After the Army terminated the ACS
development contract, the Navy considered remaining part of the Army's
development effort. However, according to Navy officials, the Chief of
Naval Operations directed the Navy to proceed with a separate development
effort, designated the EPX. The Navy now plans to proceed with system
development and demonstration in the fourth quarter of fiscal year 2010.
The Navy has not established a date to begin fielding the new system, but
that is not likely to take place before 2017. This will be a 5-year slip
in retiring the oldest EP-3 systems and will make modifications to those
systems necessary so that they can remain in the field until the Navy
achieves full operating capacity for its EPX. The Navy plans to invest
$823 million between fiscal years 2008 and 2013 to modify the EP-3, an
increase of 73 percent over the $475 million that was previously planned.

^5The Navy's fiscal year 2004 budget did not include any funding for ACS
because it was submitted before the decision to jointly acquire ACS with
the Army.

Table 4 summarizes the budgetary impact of the delay in developing and
fielding ACS on the legacy systems it was to replace.

Table 4: Fiscal Years 2004 and 2008 President's Budget for the Army's
Guardrail Common Sensor and Airborne Reconnaissance Low and the Navy's
EP-3

Source: GAO analysis of DOD data.

aPercent increase from zero is not calculated.

Global Hawk

The Air Force plans to replace the U-2 with the Global Hawk, but delays in
the Global Hawk program have contributed to the need to keep the U-2 in
the inventory longer than anticipated. In December 2005, the Air Force had
planned to begin retiring the U-2 in fiscal year 2007 and complete the
retirement by fiscal year 2012. Although the next configuration of the
Global Hawk (with limited signals intelligence capability) is scheduled
for delivery in fiscal year 2009, it will not have the same capability as
the U-2. The version of the Global Hawk that plans to include a more
robust signals intelligence capability is scheduled to begin deliveries in
2012. The Air Force is now developing a plan to fully retire the U-2s a
year later, in 2013, and at a slower rate than in the 2005 plan. There are
no funds in the budget beyond fiscal year 2006, but Air Force officials
stated they intend to fund projects necessary to keep the U-2 capable.
Figure 1 shows the rate at which the Air Force had planned to retire the
U-2 and the revised retirement plan compared to Global Hawk fielding.

Figure 1: U-2 Retirement and Global Hawk Fielding

Opportunities Exist for Greater Collaboration across the Services' ISR Programs

Among the ISR acquisition programs we reviewed, we found specific cases
where the military services have successfully collaborated and achieved
savings of time and resources. The Army estimated that for its Fire Scout
program, buying common components with the Navy Fire Scout program would
save $200 million in development costs alone and that there were greater
opportunities for savings. However, we also found cases where more
collaboration is needed to provide greater efficiencies and jointness in
developing more affordable new systems and to close gaps in capabilities.
These programs include the potential for greater collaboration between the
Navy Broad Area Maritime Surveillance (BAMS) and the Air Force Global Hawk
programs, and the Air Force Predator and Army Warrior programs.

Army and Navy's Collaboration on Fire Scout Has Achieved Efficiencies

In 2000, the Navy began development of the Fire Scout, a vertical takeoff
and landing UAS for use on surface ships. At the same time, the Army began
concept development for its Future Combat Systems (FCS) program. ^6 The
Army Fire Scout was selected for the Future Combat Systems in 2003.
Although these programs were not required to work jointly or collaborate,
Army Fire Scout program managers contacted their counterparts in the Navy
to determine whether efficiencies could be achieved through collaboration.

Officials from the two programs met several times to share information on
their respective aircraft's configuration, performance requirements,
testing, support, and other issues. Initially the requirements for the two
systems were quite different. For example, the Army's UAS had four rotor
blades and a larger engine, while Navy's system had three rotor blades and
a smaller engine. However, after discussions, the Navy officials
determined that the Army's Fire Scout aircraft would meet their needs and
decided to switch to the Army's configuration. Both services are buying
common components, such as the air vehicle and flight components, under
one contract.

An Army program management official estimated that the savings to the Army
in research and development alone would be about $200 million. As both
programs mature, the official believes additional synergies and savings
could be realized through contract price breaks on quantities and shared
test assets, such as air vehicles, support equipment, and test components.
Jointly acquiring common hardware under one contract will also reduce
procurement administrative lead time and permit common design, tooling,
and testing. Finally, future payload development, such as communications,
sensors, and data links, could be procured jointly.

^6The Army's Future Combat Systems , a family of systems that will equip
the Army's transformational combat brigades, are composed of unmanned
ground and air vehicles (including the Fire Scout), networked combat and
sustainment systems, and unattended sensors and munitions. FCS is about
halfway through its development.

Collaboration on Broad Area Maritime Surveillance Could Yield Similar
Efficiencies

In 2000, the Navy identified a mission need for a broad area maritime and
littoral ISR capability and on the basis of a 2002 analysis of
alternatives, the Navy decided to pursue a manned platform, the
Multi-mission Maritime Aircraft (MMA), with an unmanned adjunct, BAMS. The
Navy subsequently performed an analysis of alternatives for the BAMS
program, which identified several potential alternatives; foremost among
them was the Global Hawk system. As a risk reduction effort, the Navy
funded the Global Hawk Maritime Demonstration program in 2003. Working
through the existing Air Force contract, the Navy procured two Global Hawk
UAS and associated ground controls and equipment.^7 The demonstration
program was expected to leverage the existing Global Hawk system to
develop tactics, training, and techniques for maritime mission
applications.

The BAMS program is at a critical juncture. It released a request for
proposals in February 2007 and plans to proceed with system development
and demonstration in October 2007. If the Global Hawk (or another existing
system like the Air Force Reaper) is selected, there are opportunities for
the Navy to work with the Air Force and take advantage of its knowledge on
the existing platform. Through collaboration, the Navy could leverage
knowledge early in the acquisition process and avoid or reduce costs for
design, new tooling, and manufacturing, and streamline contracting and
acquisition processes.

Collaboration Slow to Occur on Warrior and Predator

Despite similarities in the Predator and Warrior programs, the Air Force
and Army have repeatedly resisted collaboration. The Air Force's Predator
is a legacy program that has been operational since 1995. Its persistent
surveillance/full motion video capability continues to be a valued asset
to the warfighter. However, when the Army began in 2001 to define
requirements for the Warrior, a system similar to the Predator, it did not
fully explore potential synergies and efficiencies with the Air Force
program. The Army did not perform an analysis of alternatives to explore
other options to a new system; it cited the urgent need of battlefield
commanders for the capability. In lieu of an analysis of alternatives, the
Army conducted a full and open competition and awarded the contract to the
same contractor producing the Predator. Although the requirements for the
Warrior were subsequently validated, reviewing officials from the Air
Force and the Joint Staff raised concerns about duplication of an existing
capability.

^7The Navy acquired two older (RQ-4A) Global Hawk aircraft for the
demonstration. These aircraft were configured with radar software that
incorporates maritime search and inverse SAR modes.

Both Congress and the Office of the Secretary of Defense (OSD) have raised
concerns about duplication between the two systems. During question and
answer sessions at various Congressional hearings, members of Congress
sought an explanation of the need for both systems. In addition, OSD
commissioned an industrial capabilities study to assess whether the
contractor for the Predator and the Warrior had sufficient capacity to
produce both systems at the same time. While the study did not find any
major production constraints, it concluded that the two systems were 80
percent common. In January 2006, the Army and Air Force agreed to consider
cooperating on the acquisition of the two systems. However, progress to
date in implementing the agreement has been limited due partly to
differences in operating concepts for the two services. Unlike the Air
Force, the Army does not use rated pilots; it relies on technicians and
automated takeoff and landing equipment. In addition, the Army uses
direct-line-of-sight communications, while the Air Force uses
beyond-line-of-sight communications. Despite these inherent differences,
there are still many areas available for collaboration, including
airframes, ground stations, and equipment.^8

The Air Force and the Army are currently working to identify program
synergies in a three-phased approach:

o First, the Air Force will acquire and test two of the more
modern Warrior airframes.
o Second, the two services will compare their requirements for
ground control stations and automated takeoff and landing.
o Finally, the Army and Air Force plan to compare concepts of
operation and training requirements for additional synergies.

^8The Air Force requires pilots who are formally trained and rated
according to Air Force aeronautical standards. These standards include
several levels of pilot training, experience, and military flying time. In
contrast, the Army uses highly trained enlisted operators. Since most of
its unmanned systems have automatic takeoff and landing capability, the
Army does not require rated pilots to operate them.

To date, the Army has coordinated the proposed approach through the Vice
Chief of Staff level, but the agreement has not yet been approved by the
Department of Army. The Air Force is still working to resolve comments and
concerns at lower organizational levels. In the interim, the Air Force has
greatly increased the number of Predator aircraft it plans to procure
annually to meet the high demand from the warfighter for this capability,
increased in part by the war on terror. Instead of buying 7 Predator
aircraft per year, as the Air Force had initially planned, it now plans to
buy 24 aircraft in both 2007 and 2008, as well as another 22 aircraft as
stated in the fiscal year 2007 supplemental request. In total, the Air
Force plans to buy 160 Predators between fiscal years 2008 and 2013.^9

The Air Force is currently seeking authority to become the executive agent
for medium- and high-altitude UAS operating above 3,500 feet. As a part of
its efforts, in March 2007 the Air Force began a comprehensive study of
all existing and planned (airborne and space-based) ISR systems. As
executive agent, the Air Force believes it could improve the allocation of
UAS, avoid duplication of separate service acquisition efforts by
centralizing procurement, standardize downlinks, and control burgeoning
bandwidth requirements.^10 However, the Air Force still intends to procure
two Warriors for testing, but details of a potential collaboration with
the Army remain uncertain.

Timing on the Army and Air Force's collaboration is critical: The longer
the services wait to collaborate, the lower the return. The opportunity to
achieve synergies in design, manufacturing, and support will greatly
diminish as the Warrior matures and more and more Predators are added to
the inventory.

^9These quantities do not include those to be acquired as a result of
additional funding provided by Congress in earlier years or quantities
associated with supplemental requests.

^10Bandwidth refers to the available frequencies to support the flight of
a UAS and is needed to support systems that control the flight of certain
unmanned aircraft, to transmit data collected by payload sensors, and to
interface with air traffic control centers. Because UAS and other weapons
or communications systems, including manned aircraft, often operate on the
same frequency, certain frequencies can become congested and interference
can occur.

DOD Efforts to Improve Collaboration

The environment in which DOD operates has changed significantly since
2001. In recognition of this, the department's 2006 Quadrennial Defense
Review described a vision that focuses on defining ISR needs based on the
type of intelligence or sensor rather than on the platform that carried
the sensor. Specifically, the department's vision for ISR is to establish
persistent surveillance over the battlefield and define ISR sensor needs
in terms of the type of intelligence needed rather than the air, surface,
or space platform in which they operate. Accordingly, the department
initiated a number of studies aimed at reviewing ISR requirements and
developing solutions either through new development programs or changes in
current systems (see app. III for a brief description of these studies).
While most of the studies have been completed, as of March 2007, DOD had
released the results of only one--the Joint ISR study, which validated the
requirement and confirmed the continued need for the Army's ACS program.
The results of the other studies have not been released outside of DOD,
but according to DOD officials, several were briefed to senior leadership
within OSD and the Joint Staff.

One study DOD is undertaking has some promise to better manage the
requirements for future ISR capabilities across DOD by applying a joint
capability portfolio management concept to acquisition planning. This
pilot program is a test case to enable DOD to develop and manage ISR
capabilities across the entire department--rather than by military service
or individual program--and by doing so, to improve the interoperability of
future capabilities, minimize capability redundancies and gaps, and
maximize capability effectiveness. However, the portfolios are largely
advisory and will, as a first step, provide input to decisions made
through the acquisition and budgeting process. At this point the
capability portfolio managers have not been given direct authority to
manage fiscal resources and make investment decisions. Without portfolios
in which managers have authority and control over resources, DOD is at
risk of continuing to develop and acquire systems in a stovepiped manner,
and of not knowing whether its systems are being developed within
available resources.^11

11 GAO, Best Practices: An Integrated Portfolio Management Approach to
Weapon System Investments Could Improve DOD's Acquisition Outcomes,
[47]GAO-07-388 (Washington, D.C.: Mar. 30, 2007).

In addition to the various studies previously initiated, two more studies
were recently commissioned in February and March of 2007. The Under
Secretary of Defense for Acquisition, Technology, and Logistics requested
that the Defense Science Board establish a task force to assess whether
current and planned ISR systems provide sufficient support for U.S.
military forces. The objectives of the study are to (1) determine what
improvements are needed for ISR systems, (2) examine the balance and mix
of sensors to identify gaps and redundancies, and (3) identify
vulnerabilities, potential problems, and consistency with DOD network
centered strategy. The Secretary also asked the task force to review the
findings of previous studies as part of the assessment. In addition, the
Chief of Staff of the Air Force recently began a comprehensive study of
all existing and planned airborne and space-based ISR systems to determine
their efficiencies and inefficiencies. The effort includes developing a
plan to increase interdependence of medium- and high-altitude UAS and
establish the Air Force as the executive agent for all UAS in those
regimes. A specific date for reporting the results of these two studies
has not been established.

Conclusions

Many ISR systems suffer from the same cost, schedule, and performance
problems as other DOD acquisition programs by failing to establish a good
business case or capture critical product knowledge at key decision points
before moving forward in the acquisition process. In some cases, the
outcomes have been costly as legacy systems, once planned for an earlier
retirement, must now stay in the inventory, requiring additional unplanned
investments to keep them relevant and operationally ready until a new
capability can be fielded. The funds spent to keep these systems viable
represent opportunity costs that could have been used for other DOD
priorities. GAO has made numerous recommendations in recent years to
improve the acquisition process and get more predictable outcomes in major
acquisition programs, and these would apply to the development of ISR
systems.

Ideally, because of the warfighter's universal needs for ISR information,
determining requirements and planning for ISR acquisition programs should
be based on a joint process that occurs at the enterprise level in DOD to
ensure economies and efficiencies based on effective joint solutions to
the maximum extent possible. DOD has various studies in process that
appear to have this as a goal for ISR, but for now it is not routinely
happening. The portfolio management pilot program could potentially
improve how DOD determines requirements and sets up new acquisition
programs for ISR capabilities. However, the portfolios are largely
advisory, and the managers have no direct authority to make investment
decisions. Without authority and control over investments there is the
risk that nothing will change. At best for now, there are some acquisition
programs that through their own initiative have garnered benefits from
collaborative efforts. Others still choose a stovepiped approach to
provide a unique system for the specific military service's needs.

Recommendations for Executive Action

While DOD has numerous ISR studies, either recently completed or ongoing,
there have been no substantive actions recently implemented to gain
greater jointness in ISR acquisition programs. Therefore, we recommend
that DOD

1. Develop and implement an integrated enterprise-level investment
strategy approach that is based on a joint assessment of
warfighting needs and a full set of potential and viable
alternative solutions, considering cross-service solutions
including new acquisitions and modifications to legacy systems
within realistic and affordable budget projections for DOD. This
strategy should draw on the results of ongoing studies, like the
portfolio management pilot program, but should include the
necessary authority and controls needed to ensure a single point
of accountability for resource decisions.
2. Report to the defense committees by August 1, 2007, the results
of the ISR studies and identify the specific plans and actions
needed and intended to make joint acquisition decisions in ISR
programs and improve the way it plans, buys, organizes, manages,
and executes its ISR acquisition programs and operations.

Agency Comments and Our Evaluation

DOD provided us with written comments on a draft of this report. The
comments appear in appendix IV.

DOD agreed that it can report the interim status of ongoing ISR studies to
the committees by August 1, 2007, but suggested that delaying this
reporting until December 31, 2007, would allow the department to include
the results of two pertinent studies now ongoing. We believe a full
reporting in December 2007 would be useful if it includes DOD's detailed
plans on how it will achieve an integrated enterprise-level investment
strategy for ISR including planned changes to policy and guidance,
organization, and points of authority and responsibility. However, we
believe an interim reporting to the committees on the results and planned
outcomes from completed studies should be provided to the committees by
August 2007.

DOD agreed with our recommendation to develop and implement an integrated
enterprise-level investment strategy for ISR and stated that it thought
this process was well under way in existing department processes. However,
it non-concurred with having a single point of authority and control for
ISR resource decisions and provided a number of arguments as to why
sufficient information was not included in the report to support this
specific part of the recommendation. We continue to believe that our
recommendation for an enterprise-level investment strategy with a single
point of accountability for resources decisions is necessary to maximize
to the full extent efficiency and effectiveness in acquiring major
acquisition systems. The Defense Science Board Summer Study on
Transformation reported in February 2006 came to similar conclusions: that
the Secretary of Defense should assemble a small direct-reporting cell to
create and maintain a metric-based, multiyear plan that specifies what is
to be done, when, with what resources, and with what capability output.^12
It concluded the Under Secretary of Defense for Acquisition, Technology,
and Logistics needs authority over architectures, resources, and
personnel. Our other review efforts of the acquisition and requirements
processes continue to show that DOD has not sufficiently improved the
process to ensure cross-service redundancies are reduced or eliminated
where possible. Therefore, without this single point of authority, limited
defense resources are still not optimally used to develop and produce
weapon systems. Our comments below address the specific arguments
presented in DOD's response to this report.

We believe that many of the ongoing initiatives to achieve a greater
integrated investment strategy approach for ISR are steps in the right
direction but are concerned that they will not go far enough to address
the problems that have occurred in DOD acquisitions for some time now. DOD
suggests that the Joint Capabilities Integration and Development System
(JCIDS) has been implemented to identify joint warfighting capabilities.
We agree that the JCIDS emphasizes a more joint approach to identifying
and prioritizing warfighting needs. However, as reported in our March 30,
2007 report, Best Practices: An Integrated Portfolio Management Approach
to Weapon System Investments Could Improve DOD's Acquisition Outcomes,
this system is still not working as planned. Despite the provisions of
JCIDS, needs continue to be based on investment decision-making processes
that do not function together to ensure DOD pursues needs that are not
redundant. The Warrior decision is an example where the service chose to
ignore the recommendations of the Joint Requirements Oversight Council and
proceeded with a unique program.

^12DOD, Defense Science Board Summer Study on Transformation: A Progress
Assessment, (Washington, D.C.: Feb. 2006).

DOD stated that its Portfolio Management Experiment supports this
enterprise-level strategy, but it is still a pilot program and actual
changes to the processes have not been identified to show how it will
ensure more responsible and joint decision making for major acquisition
programs. As pointed out in the report, while this seems like a good first
step, portfolios are largely advisory and managers have not been given
direct authority to manage fiscal resources and make investment decisions.
Without this authority, DOD continues to risk stovepiped solutions that
may overlap and not be affordable within available resources. Furthermore,
it seems within the last few years the real input from DOD leadership
comes at the end of the year, right before the budget is supposed to go to
Congress. In December each year a Program Budget document is issued by the
Office of the Secretary of Defense that has included radical changes to
major acquisition programs but without the transparency as to the detailed
analysis and integrated investment planning that should have taken place
to make these major investment decisions.

In its response, DOD also states that a number of successes have occurred
within the Unmanned Aerial Systems portfolio managed by the Office of
Under Secretary of Defense for Acquisition, Technology, and Logistics.
While there may be some successful UAS programs, there are also examples
of large, important programs that have significantly exceeded cost
estimates and delivery dates. We believe that having a UAS portfolio is
contrary to the direction of the Quadrennial Defense Review to get away
from "platform"-based decisions and move toward "sensor"-based decisions.
The Battlespace Awareness Functional Capabilities Board, as part of the
JCIDS process, seems to be a more representative grouping of ISR programs
than the UAS portfolio. We believe if properly organized based more on
"sensor" requirements, then it would not be necessary to have both for ISR
investment decision making.

DOD states that we did not consider the department's ongoing efforts to
develop UAS and ISR Roadmaps that represent, according to them,
enterprise-level strategies. While we did not review these as part of this
review, GAO has ongoing work under a different engagement that is looking
at the ISR Roadmap. The initial conclusions from that review were
presented to the House Armed Services Subcommittee on Air and Land Forces
in testimony on April 19, 2007.^13 GAO testified that the ISR Roadmap was
a noteworthy step in examining ISR capabilities but it does not represent
a comprehensive vision for the ISR enterprise or define strategy to guide
future investments. Furthermore, the ISR Roadmap is managed by the Office
of the Under Secretary of Defense for Intelligence, while the UAS Roadmap
is managed by the Office of the Under Secretary of Defense for
Acquisition, Technology, and Logistics. This difference emphasizes the
need for a single point for ISR investment decisions within OSD.

Finally, DOD states that the report does not recognize ground component
requirements and operating concepts for multiple joint missions and that
it did not recognize the benefits of acquisition programs with unique
requirements or the benefits of competition. We believe the report, as it
relates to the decision to buy a unique platform for the Warrior, did
recognize the difference in how the two services planned to operate the
platforms. However, we do not believe that it necessarily excuses DOD to
buy two different platforms to satisfy the warfighter's expressed ISR
requirement. Furthermore, we believe it has been the unique stovepiped
solutions of the military services that have over time created unnecessary
duplication and inefficient use of limited defense funding. As to
competition, GAO has consistently expressed its belief that with proper
controls and oversight competition is beneficial to price, reliability,
performance, and contractor responsiveness in buying major weapon systems.

We are sending copies of this report to the Secretary of Defense and
interested congressional committees. We will also make copies available at
no charge on the GAO Web site at http://www.gao.gov .

If you have any questions about this report or need additional
information, please contact me at (202) 512-4841 or [email protected].
Contact points for our Offices of Congressional Relations and Public
Affairs may be found on the last page of this report. Key contributors to
this report were Michael Hazard, Assistant Director; Dayna Foster; Rae Ann
Sapp; Michael Aiken; and Karen Sloan.

^13GAO, Intelligence, Surveillance, and Reconnaissance: Preliminary
Observations on DOD's Approach to Managing Requirements for New Systems,
Existing Assets, and Systems Development, GAO-07-596T (Washington, D.C.:
Apr. 19, 2007).

Michael J. Sullivan
Director Acquisition and Sourcing Management

Appendix I: Objectives, Scope, and Methodology

This report examines the Department of Defense (DOD) development and
acquisition of airborne intelligence, surveillance, and reconnaissance
(ISR) systems. The primary focus of this work is to identify practices and
policies that lead to successful fielding of weapon systems to the
warfighter at the right time and for the right price. Specifically, our
objectives were to (1) evaluate various ISR platforms for potential
synergies and assess their cost and schedule status and the impact of any
increases or delays on legacy systems and (2) evaluate the effectiveness
of ISR investment decisions. Our work was conducted between June 2006 and
April 2007 in accordance with generally accepted government auditing
standards.

We selected 20 major airborne ISR programs in technology or systems
development, already fielded but undergoing significant upgrade, or
operating in the field but due to be replaced by a system in development
and one space-based program in technology development.^1 We considered a
program in development to be major if DOD designated it as a major defense
acquisition program or would be likely do so at Milestone B.^2 We
considered systems already operating in the field as major if they played
a role in current operations.

For the systems we selected, we obtained information on current or
projected operational capabilities, acquisition plans, cost estimates,
schedules, and estimated budgets. We analyzed the data to determine
whether pairs of similar systems shared common operating concepts,
capabilities, physical configurations, or primary contractors. We reviewed
acquisition plans for programs in development to determine whether they
had established sound business cases or if not, where the business case
was weak. We reviewed cost and schedule estimates to determine whether
they had increased and, where possible, identified reasons for the
increases. For systems in development that experienced a schedule delay,
we determined whether the delay had an impact on the legacy system to be
replaced and, where possible, determined the cost or capability impact of
the delay. We assessed the reliability and validity of agency
official-provided and third-party data by discussing the data with
officials from multiple agencies at varying levels of responsibility. We
also discussed the results of our reviews and analyses with program office
officials; Army, Navy, and Air Force acquisition and requirements
officials; the Office of the Under Secretary of Defense for Intelligence;
and the Office of the Joint Chief of Staff for Intelligence.

^1The Joint Staff identifies 31 core ISR systems; our review included 14
of them. We added two programs that are developing payloads for ISR
systems and 4 more systems that were in development but were not part of
the core group as of August 2006, when we established our list.

^2Milestone B is the initiation of an acquisition program as defined by
DOD Instruction 5000.2, Operation of the Defense Acquisition System (May
12, 2003).

Appendix Appendix II: System Descriptions

Aerial Common Sensor

The Army is planning to develop the Aerial Common Sensor (ACS) as an
airborne ISR and target acquisition system and is designing it to provide
timely intelligence data on threat forces to the land component commander.
The platform will be a piloted business jet and will carry a suite of
sensors to collect information on electronics and communications signals,
optical and infrared images, measures and signatures, and synthetic
aperture radar (SAR) images. Four onboard intelligence analysts will
operate the mission equipment, but with the appropriate connectivity, the
system can perform its mission with just the flight crew. The ACS will
replace the Guardrail Common Sensor and the Airborne Reconnaissance Low
airborne systems and will coexist with current systems until it is phased
in and current systems retire. The Army has not established a date for
initial operating capacity. ACS was to have replaced the Navy EP-3 as
well. However, the Navy recently decided to pursue its own development
program and expects to enter system development in 2010.

Airborne Reconnaissance Low

Airborne Reconnaissance Low (ARL) is composed of communications
intelligence and imagery intelligence sensors and onboard operators in a
piloted aircraft. The current inventory includes two configurations; one
with a complete communications sensor package capable of intercepting and
locating radio emissions and providing reports to appropriate commanders
and intelligence-processing centers on the ground. The more capable
version combines communications and electro-optical (EO) sensors and SAR
with moving target indicator onto one aircraft. The ARL will eventually be
replaced by ACS.

Airborne Signals Intelligence Payload

The Airborne Signals Intelligence Payload (ASIP) is a signals intelligence
(SIGINT) sensor being developed for use on multiple Air Force platforms.
It is a part of Air Force efforts to modernize its SIGINT processes by
developing an Air Force-wide capability for performing SIGINT. ASIP
sensors will be developed for use on the legacy U-2 and Rivet Joint manned
aircraft. It will also be used on legacy and developmental unmanned aerial
systems (UAS) to include the MQ-1 (Predator) and RQ-4B Global Hawk. The
details about its capabilities are classified.

Broad Area Maritime Surveillance Aircraft System

The Broad Area Maritime Surveillance (BAMS) UAS is scheduled to begin
systems development in October 2007. The BAMS system will be land-based
and provide a high-altitude, persistent ISR capability to the fleet and
joint forces commander. BAMS will conduct continuous maritime and littoral
surveillance of targets. As part of the Navy's maritime patrol and
reconnaissance force, it will operate independently or in conjunction with
the Multi-mission Maritime Aircraft (MMA) and EP-3/EPX signals
intelligence platform. Because the BAMS has not yet begun system
development, vehicle design and sensor payload decisions have not been
finalized, but will include active imaging radar, passive optical imaging,
and limited signals collection capability. Its projected initial
operational capability is 2013.

E-10A

The E-10A Program originally consisted of three primary elements: the
aircraft, the radar, and the battle management command and control system.
The aircraft proposed for the E-1OA was the Boeing 767 jet aircraft. The
radar was to be the Multi-Platform Radar Technology Insertion Program, an
advanced radar that provides capability for cruise missile defense through
air moving target indicator as well as enhanced ground moving target
indicator. The program was reduced from a technology development program
to a demonstration effort. The demonstration effort was focused on
assessing the newer radar, which will also be used on the Global Hawk UAS.
However, the Air Force recently canceled the demonstration effort.

EP-3

The EP-3E Airborne Reconnaissance Integrated Electronics System (ARIES) II
is the Navy's only land-based SIGINT reconnaissance aircraft. It is a
legacy aircraft based on the Navy's Orion P-3 airframe and provides fleet
and theater commanders worldwide with near-real-time tactical SIGINT. It
uses sensitive receivers and high-gain dish antennas to perform its
mission. The Navy had planned to replace this aircraft with the Army ACS
because the EP-3 airframe is aging and has a limited life span. Drawdown
of the EP-3E aircraft was scheduled to begin in the 2012 time frame but
may be extended. Delays in ACS development contributed to the Navy's
recent decision to pursue its own replacement for the EP-3.

EPX

The EPX is the Navy's replacement for its aging EP-3. In late summer 2006,
after a study on joint ISR requirements had been completed, the Navy and
Army concluded that there were significant requirements differences
between the two services. As a result, the Chief of Naval Operations
directed the Navy to recapitalize the EP-3 to provide multi-intelligence
capability. While requirements for the EPX have not been fully
established, it will be a multi-intelligence platform and will include
communications and electronics intelligence capability, optics, and radar.
EPX is part of the maritime patrol and MMA and BAMS.

Fire Scout (Army)

The Army Fire Scout is being developed as one of the UAS within the Future
Combat Systems. As part of this system of systems, the Fire Scout is
designed to support air-ground operations and reconnaissance,
surveillance, and target acquisition missions. It will employ SAR with
moving target indicator, EO sensors and a laser rangefinder/designator, a
tactical signals intelligence package, and the joint tactical radio system
communications suite. The Fire Scout is designed to take off and land in
unimproved areas to directly support brigade combat team operations. Its
initial operating capability is tied to the Future Combat Systems, which
is planned for December 2014.

Fire Scout (Navy)

The Navy Fire Scout, or the vertical takeoff and landing unmanned aerial
vehicle system, (VTUAV), entered systems development in February 2000. The
Fire Scout is designed to provide ISR as well as targeting data and damage
assessments to tactical users. It is capable of autonomous vertical
takeoff and landing on aircraft carriers as well as unprepared landing
zones. The Fire Scout includes EO/IR sensors, a laser designator system,
and a common automatic recovery system. The modular payload approach also
includes the tactical control system, tactical common datalink, and a mine
detection system. Its initial operating capability is planned for October
2008.

Joint Surveillance, Target, Attack, Radar System

Joint Surveillance, Target, Attack, Radar System (STARS) is a joint Air
Force and Army wide area surveillance attack radar system designed to
detect, track, and classify and support the attack of moving and
stationary targets. Joint STARS is a legacy platform first used in the
1991 Gulf War. It has been used extensively in support of Operations
Enduring and Iraqi Freedom. The Joint STARS fleet of aircraft is currently
being modified with new communication and navigation equipment, and the
Air Force is developing advanced mission capabilities and identifying
low-cost emerging technologies for future use. In addition, the Air Force
intends to replace Joint STARS engines to make the platform more reliable
and reduce operating and support costs. Finally, the Air Force had
originally intended to place Multi-Platform Radar Technology Insertion
Program (MP-RTIP) on Joint STARS but decided not to when it chose to go
forward with the E-10A, which was subsequently canceled.

Global Hawk

The Global Hawk is a high-altitude, long-endurance UAS designed to provide
near-real-time high-resolution ISR imagery. It employs a SAR, ground
moving target indicator, and EO/IR sensors. After a successful technology
demonstration, the Global Hawk entered development and limited production
in March 2001. Production of the initial seven (RQ-4A) aircraft is
complete. The larger, more capable version (RQ-4B) includes an advanced
signals intelligence payload and improved radar technologies. Initial
operational capability is planned for September 2007.

Guardrail Common Sensor

Guardrail Common Sensor (GRCS) is an airborne signals intelligence
collection location and exploitation system in the current inventory that
provides near-real-time signals intelligence and targeting information to
tactical commanders. The system integrates a communications intelligence
sensor and precision geolocation of signals. The platform is a small,
piloted aircraft with no onboard analysts. The Army plans on eventually
replacing GRCS with the ACS.

Multi-mission Maritime Aircraft

The Navy's MMA is part of the broad area maritime family of systems. The
MMA was initially planned to interoperate with the BAMS UAS and the ACS.
The MMA is intended to replace the Navy's P-3C Orion system. Its primary
role will be that of anti-submarine and anti-surface warfare, and it will
have some ISR capability. The Navy plans for the aircraft to achieve
initial operational capability in 2013.

Multi-Platform Radar Technology Insertion Program

The MP-RTIP is a family of scalable, advanced radars that are being
developed for the RQ-4B Global Hawk and the E-10A. The Air Force funded
the sensor development under the E-10A budget line as a separate item. The
radar is currently in system development and demonstration. However, in
February 2007, the Air Force removed funding for the E-10A radar
development program starting in fiscal year 2008. The Air Force still
intends to develop the radar for the Global Hawk and begin fielding the
sensor by 2011.

Predator

The Predator is a medium-altitude long-endurance UAS. The Predator began
as an advanced concept technology demonstration program and has been
operational since 1995. Originally designed as a persistent ISR platform,
it was modified in 2001 to carry two Hellfire missiles. The Predator
employs EO/IR sensors, laser designator, day/night cameras that produce
full motion video of the battlefield, and can be configured to carry SAR.
Used as an armed reconnaissance system, the Predator also has a
multi-spectral targeting system with Hellfire missile targeting
capability. The Air Force has begun an effort to develop and integrate
signals intelligence capability on the Predator. To accelerate this
effort, the Air Force increased this budget by a factor of almost 6 in
fiscal year 2008.

Reaper

The Reaper (formerly Predator B) is a multirole medium- to high-altitude
endurance UAS. Its primary mission is a persistent hunter-killer for small
ground mobile or fixed targets. Its secondary mission is to gather ISR
data. It will use EO/IR sensors, laser rangefinder/designator, and SAR,
and will carry ordnance such as the Joint Direct Attack Munitions and
Hellfire missiles. The Reaper entered systems development in February
2004. Its initial operating capability is planned for 2009. The Air Force
has begun to examine the feasibility of incorporating signals intelligence
capability on the Reaper.

Rivet Joint

Rivet Joint (RJ) is a reconnaissance aircraft in the current inventory
that supports theater- and national-level consumers with near-real-time
on-scene intelligence collection, analysis, and dissemination
capabilities. The aircraft is an extensively modified C-135 with a suite
of onboard sensors, which allows the mission crew to detect, identify, and
geolocate signals throughout the electromagnetic spectrum. The mission
crew can then forward gathered information in a variety of formats to a
wide range of consumers via the system's extensive communications suite.
The interior seats 34 people, including the cockpit crew, electronic
warfare officers, intelligence operators, and in-flight maintenance
technicians. The first versions of the system were deployed in 1964, but
have undergone extensive upgrades to both the platform and mission
equipment. The Air Force does not have any plans to replace the system.

Space Radar

Space Radar (SR) is an Air Force-led, joint DOD, and intelligence
community program to develop a satellite to find, identify, and monitor
moving or stationary targets under all weather conditions on a nearly
continuous basis across large swaths of the earth's surface. As
envisioned, SR would generate volumes of radar imagery for transmission to
ground-, ship-, air-, and space-based systems. Initial capability is
planned for 2017.

U-2

The U-2 provides continuous day-and-night, high-altitude, all-weather
surveillance and reconnaissance in direct support of U.S. and allied
ground forces. It is a single-engine and single-seat ISR aircraft. The U-2
is capable of collecting multisensor, photo, EO/IR, and radar imagery as
well as collecting SIGINT data. It can downlink all data except wet film.
The Air Force proposed to begin retiring the U-2 in 2007. However,
Congress disagreed with the decision and prevented retirement in 2007.
Congress also directed the Air Force to first certify that the capability
was no longer required. In March 2007, the Air Force revised the schedule
from removing the U-2 from the inventory and proposes doing so at a slower
rate than before beginning in fiscal year 2008. The Air Force is not
requesting funding for the U-2 past 2007, but it is not clear whether the
Air Force has provided the certification that Congress requested.

Warrior

The extended range, multipurpose Warrior UAS began systems development in
April 2005. It will operate with manned aviation assets such as the Apache
helicopter and perform missions including reconnaissance, surveillance,
and target acquisition/attack. It is being developed to satisfy the Army's
requirement for a UAS that is dedicated to the direct operational control
of its field commanders. The Warrior is designed with an automatic takeoff
and landing system, full motion video capability, tactical signals
intelligence payload, multirole tactical common data link, EO sensors,
SAR/ moving target indicator, Ethernet communications capability, and
redundant avionics. Its initial operational capability is planned for
2010.

Appendix III: ISR Studies Under Way or Recently Completed

Program Decision Memorandum III, dated December 2005 directed that several
studies be undertaken.^1 Those studies included the following.

Joint ISR Replacement Study

The Army and Navy, in coordination with the Air Force, Joint Staff, Under
Secretary of Defense for Policy, Under Secretary of Defense for
Intelligence (USD(I)), and Program Analysis and Evaluation (PA&E), were
directed to conduct a study of joint multi-intelligence airborne ISR
needs, focusing on trade-offs among manned and unmanned airborne platforms
and how those trade-offs translate into requirements for recapitalizing
the Army, Navy, and Air Force legacy systems. The participants were
directed to identify any resources in addition to the fiscal year 2006
President's budget program of record to sustain the Army and Navy aircraft
until they can be replaced. The study was completed in late summer of 2006
and concluded that the requirements for the ACS were still valid.

U-2 Retirement Study

The Strategic Command, in coordination with the Air Force; Navy; Under
Secretary of Defense for Acquisition, Technology, and Logistics
(USD(AT&L)); USD(I); and PA&E were directed to review the Air Force's
Global Hawk acquisition and U-2 retirement plan and determine if
high-attitude, long-endurance, multi-intelligence ISR requirements will be
satisfied during the transition. The findings were briefed within the
Office of the Secretary of Defense (OSD) in early fall 2006.

Airborne ISR Requirements

USD(I), in conjunction with the Joint Staff, services, and PA&E was
directed to develop a methodology to migrate to a capability-centric
focus, instead of a platform-centric focus, for determining combatant
commander and joint task force airborne ISR requirements. Results were
briefed within OSD in early fall 2006.

These studies were recently commissioned:

Optimization of ISR Capabilities

On March 5, 2007, the Air Force Chief of Staff announced the start of a
comprehensive study of all existing and planned ISR systems--both airborne
and spaced-based--to consider the efficiencies and inefficiencies in the
theater and global warfighting templates. As part of this broad effort, he
advocated that the Air Force immediately become the executive agent for
medium- and high-altitude UAS. The expected benefits from the study and
executive agent concept include improving distribution of intelligence
assets across all theaters and components, avoiding duplication of
acquisition efforts, standardizing UAS operations and downlinks, and
controlling ballooning bandwidth requirements. The results of the study
will include a comprehensive plan to optimize ISR capabilities, due in
late April 2007.

^1Several other studies were commissioned but information related to them
is classified and cannot be summarized here.

Task Force on Integrating Sensor-Collected Intelligence

In February 2007, the Under Secretary of Defense for Acquisition,
Technology, and Logistics requested that the Defense Science Board
establish a task force to assess whether current and planned ISR systems
provide sufficient support for U.S. military forces.^2 The primary
objective is to determine what improvements are needed in carrying out the
tasks associated with ISR systems. A second objective is to examine the
mix and balance of ISR sensors to identify gaps and redundancies. The task
force was also asked to examine current and planned systems for
vulnerabilities, new opportunities and potential problems, and consistency
with department strategy for networked operations. Finally, the memorandum
also asked the task force to review the results of a number of studies,
initiated by OSD and completed in the fall of 2006, following the
completion of the 2006 Quadrennial Defense Review. Several of these
studies are summarized in this appendix. The tasking memorandum did not
include time frames for completion of the study or for reporting the
results.

^2The Defense Science Board is composed of members designated from
civilian life by the Under Secretary of Defense for Acquisition,
Technology, and Logistics and advises the Secretary of Defense; the Deputy
Secretary of Defense; the Under Secretary of Defense for Acquisition,
Technology, and Logistics; and the Chairman of the Joint Chiefs of Staff
on scientific, technical, manufacturing, acquisition process, and other
matters of special interest to DOD.

Appendix IV: Comments from the Department of Defense

(120559)

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Highlights of [56]GAO-07-578 , a report to the Subcommittee on Air and
Land Forces, Committee on Armed Services, House of Representatives

May 2007

DEFENSE ACQUISITIONS

Greater Synergies Possible for DOD's Intelligence, Surveillance, and
Reconnaissance Systems

Given the significant investments, GAO was asked to (1) evaluate various
ISR platforms for potential synergies and assess their cost and schedule
status and the impact of any increases or delays on legacy systems and (2)
assess the effectiveness of ISR investment decisions. To assess cost and
schedule status, we reviewed programmatic and budget documentation. To
evaluate investment decisions, we collected data on system capability,
mission, and concept of operation and analyzed them for similarities.

[57]What GAO Recommends

GAO is recommending that DOD (1) develop and implement an integrated
enterprise-level investment strategy approach that draws on the results of
ongoing studies and (2) report to the defense committees by August 1,
2007, the results of the ISR studies and identify specific plans and
actions it intends to get greater jointness in ISR programs. DOD generally
believes current initiatives will address our recommendations.

DOD plans to invest over $28 billion over the next 7 years to develop,
procure, and modernize 20 major airborne intelligence, surveillance and
reconnaissance systems. Nearly all of the systems in development have
experienced cost growth or schedule delays. These problems have delayed
the fielding of a warfighting capability and have resulted in program
restructuring, cancellation, or unplanned investments in older legacy ISR
systems. For example, problems in developing the Aerial Common Sensor
affected three legacy programs, increasing their collective budgets by 185
percent, or nearly $900 million. In many cases, GAO found that the newer
ISR programs lacked a solid business case or a knowledge-based acquisition
strategy before entering the development process. A good business case
requires the manager to match the system requirements with mature
technologies and a system design that can be built. This requires
sufficient knowledge about the system gained through basic system
engineering concepts and practices.

Although it fights jointly, DOD does not always procure new systems
jointly. Instead, each service typically develops and procures systems
independently. Opportunities exist for different services to collaborate
on the development of similar weapon systems as a means for creating a
more efficient and affordable way of providing new capabilities to the
warfighter. GAO identified development programs where program managers and
services are working together to gain these efficiencies and other
programs that have less collaborative efforts and could lead to more
costly stovepiped solutions. For example, the Navy and Army have
collaborated successfully on the Fire Scout, but in contrast, the Air
Force and Army have not been as collaborative on the Predator and Warrior
systems, as they each currently plan unique solutions to their similar
needs.

Developmental ISR Systems and Capabilities Planned

Source: GAO analysis of DOD data.

References

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