Defense Acquisitions: Achieving B-2A Bomber Operational Requirements
(Letter Report, 06/10/99, GAO/NSIAD-99-97).

Pursuant to a legislative requirement, GAO provided information on the
total acquisition costs of the Air Force's B-2A bomber program through
completion of the production program, focusing on the: (1) deficiencies
in achieving B-2A operational requirements; and (2) status of
acquisition costs.

GAO noted that: (1) operational testing indicated that the B-2A met most
operational requirements, but four significant deficiencies were
identified that will limit or, under some circumstances, slow its pace
in flight operations; (2) these deficiencies include: (a) incomplete
development of the ground mission planning system; (b) limited
situational awareness for the crew because defensive avionics do not
provide the planned capability; (c) insufficient reliability and
maintainability of low observable materials and features; and (d)
inability to effectively operate B-2As from operational sites other than
the main operating base in Missouri; (3) a March 1999 Air Force
assessment of progress on correcting the deficiencies confirmed that
three of the four had not been remedied, but that one--development of
the ground mission planning system--was nearly corrected; (4) although
the Air Force is taking steps to improve B-2A operational capabilities,
it does not expect to incorporate all improvements before the next
planned operational milestone, known as Full Operating Capability, which
is scheduled to occur by June 30, 1999; (5) Congress has appropriated 98
percent of the funds that in March 1999 the Air Force estimated it would
need for the acquisition of 21 block 30 B-2As and certain future
improvements; (6) this program cost estimate is $44.5 billion and,
according to Air Force officials, includes costs to complete
development, production, modification, correction of the major
deficiencies, and certain improvements to the block 30 configuration;
(7) Air Force officials told GAO, however, that funding requirements for
future years and the total acquisition cost for the program may
increase; (8) they indicated that certain assumptions used to calculate
the March 1999 estimate may no longer be valid; and (9) these
assumptions include the cost to install certain improvements to low
observable features, the period of time the contractor is expected to
support the aircraft, and the cost of acquiring shelters for B-2A
maintenance.

--------------------------- Indexing Terms -----------------------------

 REPORTNUM:  NSIAD-99-97
     TITLE:  Defense Acquisitions: Achieving B-2A Bomber Operational
	     Requirements
      DATE:  06/10/99
   SUBJECT:  Operational testing
	     Weapons systems
	     Bomber aircraft
	     Defense capabilities
	     Concurrency
	     Cost analysis
	     Avionics
	     Air Force procurement
	     Future budget projections
	     Contract costs
IDENTIFIER:  B-2A Aircraft
	     DOD Operation Allied Force
	     Air Force Mission Support System

******************************************************************
** This file contains an ASCII representation of the text of a  **
** GAO report.  This text was extracted from a PDF file.        **
** Delineations within the text indicating chapter titles,      **
** headings, and bullets have not been preserved, and in some   **
** cases heading text has been incorrectly merged into          **
** body text in the adjacent column.  Graphic images have       **
** not been reproduced, but figure captions are included.       **
** Tables are included, but column deliniations have not been   **
** preserved.                                                   **
**                                                              **
** Please see the PDF (Portable Document Format) file, when     **
** available, for a complete electronic file of the printed     **
** document's contents.                                         **
**                                                              **
** A printed copy of this report may be obtained from the GAO   **
** Document Distribution Center.  For further details, please   **
** send an e-mail message to:                                   **
**                                                              **
**                                            **
**                                                              **
** with the message 'info' in the body.                         **
******************************************************************
ns99097 GAO United States General Accounting Office

Report to Congressional Committees

June 1999 DEFENSE ACQUISITIONS

Achieving B-2A Bomber Operational Requirements

GAO/NSIAD-99-97

  GAO/NSIAD-99-97

Page 1 GAO/NSIAD-99-97 Defense Acquisitions United States General
Accounting Office

Washington, D. C. 20548 National Security and International
Affairs Division

B-280223 Letter June 10, 1999 Congressional Committees The
conference report on the National Defense Authorization Act for
Fiscal Year 1994 requires us to report to the congressional
defense committees at regular intervals on the total acquisition
costs of the B-2A bomber program

through completion of the production program. In response, we have
issued five reports since 1994. 1 Because B-2A production is
essentially completed, this will be the last of these reports. The
present report discusses deficiencies in achieving B-2A
operational requirements and the

status of acquisition costs. We have not obtained and evaluated
details on the effectiveness of the B-2As currently employed in
Operation Allied Force. Even though B-2As are employed in that
operation, concerns remain about this aircraft's ability to
achieve the operational requirements discussed in this report.

Results in Brief Operational testing indicated that the B-2A met
most operational requirements, but four significant deficiencies
were identified that will limit or, under some circumstances, slow
its pace in flight operations. These deficiencies included (1)
incomplete development of the ground mission planning system, (2)
limited situational awareness for the crew because defensive
avionics do not provide the planned capability, (3) insufficient
reliability and maintainability of low observable materials and
features, and (4) inability to effectively operate B-2As from
operational sites other than the main operating base in Missouri.
A March 1999 Air

Force assessment of progress on correcting the deficiencies
confirmed that three of the four had not been remedied, but that
one development of the ground mission planning system was nearly
corrected. Although the Air Force is taking steps to improve B-2A
operational capabilities, it does not expect to incorporate all
improvements before the next planned

operational milestone, known as Full Operating Capability, which
is scheduled to occur by June 30, 1999. The Congress has
appropriated 98 percent of the funds that in March 1999 the Air
Force estimated it would need for the acquisition of 21 block 30 1
A list of related GAO reports is included at the end of this
report.

Lett er

B-280223 Page 2 GAO/NSIAD-99-97 Defense Acquisitions

B-2As 2 and certain future improvements. This program cost
estimate is $44. 5 billion and, according to Air Force officials,
includes costs to complete development, production, modification,
correction of the major deficiencies, and certain improvements to
the block 30 configuration. Air Force officials told us, however,
that funding requirements for future years

and the total acquisition cost for the program may increase. They
indicated that certain assumptions used to calculate the March
1999 estimate may no longer be valid. These assumptions include
the cost to install certain improvements to low observable
features, the period of time the contractor is expected to support
the aircraft, and the cost of acquiring shelters for B-2A
maintenance.

This report contains no recommendations. Background The 21 B-2As
ordered by the Air Force have been delivered, but most were

delivered in configurations known to need modifications.
Production was begun and aircraft delivered before developmental
and initial operational tests were completed. Accordingly,
problems and deficiencies noted in the

tests had to be corrected and some features and equipment had to
be added after the aircraft were delivered to the Air Force. A
comprehensive modification program was designed to correct
problems and defects and to

incorporate the needed equipment. This modification program was
designed to bring each B-2A up to a configuration designated block
30. Through January 1999, 12 B-2As were still being modified to
the block 30 configuration. On average, they were about 50 percent
complete. The B-2A acquisition schedule and the overlap of
development and production are shown in figure 1.

Between the beginning of development and completion of the block
30 modification program, 21 years will have elapsed. The next
milestone for the program is Full Operating Capability (FOC),
which is defined as the capability to meet block 30 operational
requirements, operate from a forward operating location, support
planned sortie rates, and achieve mission requirements. The
commander of the Air Force Air Combat Command is scheduled to
determine by June 30, 1999, whether the B-2A 2 The B-2A's
operational configuration is defined as a block 30 aircraft. The
Air Force accepted B-2As in two other configurations, a block 10
training aircraft and block 20 interim capability aircraft, all of

which will be upgraded to the block 30 configuration.

Lett er

B-280223 Page 3 GAO/NSIAD-99-97 Defense Acquisitions

has achieved FOC based on an assessment of the B-2A system
performance measured against the operational requirements.

Figure 1: Overview of the B-2A Acquisition Schedule as of January
1999

Source: Air Force B-2A Program Baseline Roadmap.

Deficiencies in Achieving Operational Requirements

Initial operational testing and evaluation (completed in June
1997) indicated that B-2As in the block 30 configuration met most
operational requirements, but it highlighted four deficiencies. A
March 1999 Air Force assessment of the progress being made in
meeting the B-2A's operational requirements indicated three of
these four deficiencies had not been fully

remedied, but that one was nearly corrected. The four deficiencies
were  incomplete development of the ground mission planning
system,

1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993
1994 1995 1996 1997 1998 1999 2000 2001 2002

Fiscal year

Full operating capability (FOC): Third quarter of fiscal year 1999
Development: Nov. 1981 - Mar. 1998 Production program: Nov. 1987 -
Nov. 1997

Block 30 modification: July 1995 - Sept. 2002 Flight test and
evaluation: July 1989 - Mar. 1998

B-280223 Page 4 GAO/NSIAD-99-97 Defense Acquisitions

 limited situational awareness for the crew because defensive
avionics do not provide the planned capability,  insufficient
reliability and maintainability of low observable materials and
features, and  inability to effectively deploy and operate B-2As
from operational sites

other than the main operating base in Missouri. The Air Force
periodically assesses the extent to which it has demonstrated that
B-2A operational requirements are achievable. Table 1 shows the
results of the Air Force's March 1999 assessment.

Table 1: March 1999 Assessment of Achieving Operational
Requirements a Air Force Mission Support System. b Global
Positioning System. Note: Requirements italicized were identified
as significant deficiencies in operational testing.

Demonstration of terrain- following and avoidance system
capability and radar capability are listed as incomplete on the
table; however, test officials Operational requirement Status of
demonstration

Ground mission planning (AFMSS) a Incomplete Situational awareness
(defensive avionics) Incomplete Reliability/ Maintainability (low
observables) Incomplete Deployment (shelters) Incomplete Terrain
following and avoidance system Incomplete Radar Incomplete
Signature Achievable Penetration Achievable GPS b aided targeting
system Achievable Navigation Achievable Contrail management system
Achievable Fixed target effectiveness Achievable Command and
control Achievable Air refueling Achievable All weather Achievable
Flying qualities Achievable In- flight mission planning Achievable
Training Achievable Range and payload Achievable

B-280223 Page 5 GAO/NSIAD-99-97 Defense Acquisitions

indicated that both systems have generally satisfied operational
requirements and need only minor improvements for operating in the
rain. Testing of new software for these systems should be
completed late in 1999.

In another March 1999 report, 3 the Air Force states that the
ground mission planning system still has deficiencies but that
improvements have been demonstrated, situational awareness
(defensive avionics) is unsatisfactory, low observable reliability
and maintainability reduces operational capability, and all
operational requirements for deployment have not been met.

Development of Mission Planning System Incomplete

Mission planning is critical to effective B-2A operations. The
mission plan is intended to provide the crew with the most
effective routing to achieve mission goals with the highest
survivability for the crew and the weapon system. Air Force
officials emphasized that successful use of AFMSS requires mission
planners well trained in mission planning and survivability
techniques for low observable aircraft.

Air Force officials told us the upgraded AFMSS met, as of March
31, 1999, the requirements for operational use with one exception:
A component that is unique to mission planning for low observable
aircraft was considered

unsatisfactory in the March 1999 B-2A follow- on test and
evaluation report. However, Air Force officials said the upgraded
AFMSS was capable of planning most B-2A missions within the 8-
hour operational requirement.

The upgraded AFMSS includes a new computer with faster speeds and
new software intended to correct most of the deficiencies
identified during initial operational testing. Based on
development testing of the new system by the contractor, Air Force
officials stated the upgraded AFMSS could complete most B-2A
mission plans within the 8- hour requirement. However, as of April
20, 1999, Air Force operational testing of AFMSS was incomplete,
and operational testers had not yet prepared a B-2A mission

plan in the required 8 hours. Air Force test officials conducting
the operational testing said that, based on testing completed, it
appears AFMSS will meet the 8- hour planning requirement for most
of the expected B-2A

3 On March 14, 1999, the Air Force issued the B-2A follow- on test
and evaluation report, which covers operational testing from July
1997 through December 1998. This is the first of two phases of
operational testing that follows the initial operational testing
that was completed in June 1997.

B-280223 Page 6 GAO/NSIAD-99-97 Defense Acquisitions

missions. In addition, test officials said the AFMSS component
used to generate routes that optimize B-2A low observable features
is still unsatisfactory. Because of deficiencies in this component
called the common low observable auto- router (CLOAR) some mission
planning

timelines could grow to 10 hours. New CLOAR software is scheduled
to be tested and delivered to the operational B-2A wing by early
2000. Air Force officials stated that even with the CLOAR
improvements there would be some small percentage of missions that
could take longer than 8 hours to plan because of the complexity
of these missions and their plans.

AFMSS is being developed by the Air Force as a separate
acquisition program. AFMSS is being integrated with the B-2A
weapon system and is being incorporated as part of the block 30
modification.

Limited Situational Awareness Caused by Ineffective Defensive
Avionics

Situational awareness requirements for the B-2A stipulate that
crews be provided sufficient information about the threats they
encounter on a mission, which will allow them to make adjustments
to the mission plan to ensure survivability of the crew and weapon
system. The defensive

avionics system was intended to provide B-2A aircrews with
information on the location and identity of threats that may be
encountered during a B-2A mission.

The Air Force spent over $740 million to develop the defensive
avionics, which does not provide the planned capability.
Developmental and initial operational testing showed the defensive
avionics system failed to provide

the situational awareness information required. It either
incorrectly identified threats or did not provide an accurate
location of threats, significantly reducing the situational
awareness to the crew. The March

1999 B-2A follow- on test and evaluation report states that the
defensive avionics is unsatisfactory and there has been little
improvement to this component since initial operational testing
was completed in June 1997.

However, the Air Force believes that the B-2A's survivability can
be obtained through effective tactics, mission planning, and low
observability features, and that failure to provide the crew with
all of the intended

situational awareness information will not prevent the B-2A's use
in combat operations. Air Force officials said the deficiencies in
the defensive avionics would be too costly to correct. As a
result, the Air Force plans to modify the defensive avionics
system to provide a useful capability, but less capability than
considered necessary for Air Force operational requirements as

B-280223 Page 7 GAO/NSIAD-99-97 Defense Acquisitions

defined in the original contract specification. The cost to make
this modification is included in the March 1999 estimate. The Air
Force does not expect to complete testing of the reduced
capability until November 1999.

Inadequate Reliability and Maintainability for Low Observable
Materials

Reduces Planned Use Rates for B-2A

The low observable features and materials on the B-2A are not
durable, and repairs of these features and materials require time-
consuming maintenance under environmentally controlled conditions
with materials that require long cure times. These factors
diminish the ability of the Air Force to fly the aircraft as
frequently as operational requirements stipulated, especially when
the aircraft is deployed to an operating location

other than the main operating base in Missouri. Although the Air
Force has improved maintenance procedures and has developed
improved materials, these problems remain the primary cause for
high maintenance times and a reduced pace in flight operations.
Further improvements are being pursued to reduce maintenance,
increase aircraft availability, and achieve the required pace of
flight operations.

The March 1999 follow- on test and evaluation report concluded
that low observable reliability and maintainability is still the
number one challenge for the Air Force because of its impact on B-
2A mission capabilities. The report states that poor low
observable reliability and lengthy maintenance times reduce
mission capable rates, adversely affect aircraft availability for
crew training, restrict operations when deployed, and limit
sustained

combat operations. Total maintenance rates have improved since
initial operational testing was completed in June 1997, but low
observable maintenance remains as a high percentage of total
maintenance one third of maintenance man- hours per flying- hour.
4 Air Force officials stated that the block 30 aircraft are
designed to incur an average of 17.7 maintenance man- hours for
each flying- hour to repair low observable features; thus,
following a 12- hour mission, a B-2A would require on average
about 212 man- hours to repair low observable features. This
estimate does not include the lengthy times required for some low
observable materials to cure (72 hours in some cases) before the
aircraft can return to a flight status. The Air Force

4 Maintenance man- hours per flying- hour is used as a measure of
maintenance performance for total aircraft maintenance but can be
used to identify problem maintenance drivers like low observable
features.

B-280223 Page 8 GAO/NSIAD-99-97 Defense Acquisitions

estimates that the number of maintenance man- hours per flight
hour must be reduced to 7.5 or lower to generate the number of
flights in a specified period (sortie rates) required for wartime.
The follow- on test results showed low observable maintenance man-
hours per flying- hour had improved, but still averaged 24. 6
maintenance man- hours for the period from July 1997 to December
1998.

Low observable maintenance and material cure times are important
factors in achieving a specific mission capable rate, which is the
percentage of time B-2As are available to perform assigned
missions. For example, if the

low observable tape on the wing does not meet the radar cross
section mission requirement, the aircraft cannot fly its mission
and the mission capable rate is reduced, or the mission is flown
with the degraded capability. The Air Force threshold requirement
for the B-2A mission

capable rate is 60 percent; however, the long- range requirement
is a mission capable rate of 77 percent. During calendar year
1997, the average mission capable rate was 36 percent. However, as
B-2As are upgraded to the block 30 configuration, the rate has
improved. For the 3- month period ending November 1998, the rate
was 46.1 percent.

A series of low observable features and materials design
improvements are being developed or implemented to achieve the
maintainability requirements. The B-2A has about 150 different low
observable materials, and the improvements are directed toward
those materials creating most of

the problems, primarily tapes and caulks used to fill gaps and
seams in the B-2A's exterior surface. The Air Force is also
evaluating materials with faster cure times, shorter process
times, less dependence on specialized support equipment, longer
shelf life, and fewer restrictions on storage requirements. In
addition, the Air Force is developing diagnostic tools intended to
speed the process of (1) assessing areas with damaged low
observable materials and (2) verifying the repairs of these
deficiencies.

Not all of the improvements will be completed and installed by the
planned FOC date. Two improvement projects designed to improve
mission capable rates and reduce low observable maintenance for
the B-2As are scheduled

to be installed during the next depot maintenance cycle, which
will take place from late 1999 through early 2006. Not all
installation costs for the material improvements are included in
the March 1999 estimate as discussed later in this report.

B-280223 Page 9 GAO/NSIAD-99-97 Defense Acquisitions

Inability to Sustain B-2A Operations When Deployed

Initial operational test reports indicated that the block 30 B-2A
aircraft must be sheltered when deployed to forward operating
locations to provide a suitable environment in which to maintain
and restore low observable materials. Currently, adequate shelters
do not exist at planned deployment locations, and until these are
provided, the Air Force will not be able to repair low observable
features quickly enough to fly B-2As at sortie rates

required at deployment locations and to sustain these rates over
the required time frames.

The March 1999 B-2A follow- on test and evaluation report states
that, based on two deployment exercises to Guam, operational
requirements for deployed aircraft were not achievable.
Requirements include the capability

to sustain the operations of eight aircraft for 14 days at
specified sortie generation rates. Problems with low observable
maintenance were identified as the major obstacles to achieving B-
2A operational requirements during these exercises. For example,
during one of the

exercises, two of the three B-2As deployed had significant low
observable deficiencies. The report states that the lack of
shelters would have prevented any major repairs of low observable
features, but that some repairs were made without the benefit of
shelters. The report also states that progress had been made, but
that improvements in low observable features and shelters are
required to successfully achieve the deployment requirements.

Status of Acquisition Costs Most acquisition efforts for the B-2A
program have been completed. The

March 1999 cost estimate of $44.5 billion includes costs to
complete the block 30 modifications as well as to develop and
incorporate improvements beyond the block 30 configuration.
Through fiscal year 1999, the Air Force has been appropriated
$43.7 billion, or 98 percent, of the total estimated costs.
According to Air Force officials, the estimate includes cost to
complete development, production, modification, correction of
major deficiencies, and certain improvements to the block 30
configuration. The Air Force stated, however, that the cost
estimate is based on certain assumptions that are no longer valid.
Air Force officials advised us that as

much as an additional $155 million could be required for
improvements to the block 30 configuration and interim contractor
support. These efforts were previously believed to have been fully
covered in the cost estimate. Further, the cost to acquire
aircraft shelters for maintenance may be higher than planned.

B-280223 Page 10 GAO/NSIAD-99-97 Defense Acquisitions

Funds Available to Complete Major Contracts

Air Force officials said adequate funds are included in the cost
estimate to complete the major contracts for development,
production, and aircraft modifications to the block 30
configuration planned through fiscal year

2002. Finishing block 30 modifications is the major effort
remaining in the program. Nineteen of the original aircraft
delivered to the Air Force needed modifications to achieve the
block 30 configuration. Through January 1999, 12 B-2As were still
being modified, and they were on average about 50 percent
complete. The block 30 modifications began in 1995 and are

scheduled to be completed in 2002. Program office contract
management reports and assessments by the Air Force indicate
adequate funds are available to complete the development and the
production contracts. For example, the Air Force estimates that

$455 million is required to complete the modification of five test
aircraft to the block 30 configuration. The contract performance
report shows that the current contractor estimate of cost to
complete the modification of these test aircraft to block 30 is
within the amount provided by the current contract and budget. The
Air Force has also evaluated the status of modifying the initial
production aircraft to the block 30 configuration, and their
evaluation shows adequate funds are available. Potential Increases
to the Acquisition Costs

The Air Force is assessing some estimating assumptions during its
fiscal year 2001 budgeting process, which may result in higher
estimated costs than included in the current B-2A estimate of
$44.5 billion. The Air Force

may require up to an additional $155 million for installing low
observable material improvements to the block 30 configuration and
for interim contractor support efforts. Further, Air Force
officials indicated that cost

to acquire aircraft shelters for maintenance may be higher than
planned. The Air Force may need an additional $83 million to
install critical improvements in the low observable features. The
Air Force March 1999 cost estimate assumed that one of the low
observable improvement programs needed to meet maintainability
requirements for the B-2A would be installed as part of the
programmed depot maintenance process to begin in late 1999. The
Air Force did not include installation costs for this improvement
in the March 1999 cost estimate. The Air Force and

contractor did not believe a significant amount of additional
labor hours would be required to install the new materials since
all low observable coatings are removed and then replaced during
depot maintenance. The contractor has further studied the efforts
required for the installation process and now believes it will
take a significant amount of additional

B-280223 Page 11 GAO/NSIAD-99-97 Defense Acquisitions

labor hours to complete the installation. They have estimated the
cost for this increased labor to be about $83 million. If the Air
Force determines this estimated increase in labor hours and cost
to be accurate, then the B-2A program cost estimate will increase.

The Air Force estimates it will need up to an additional $72
million to pay for contractor maintenance contracts referred to as
interim contractor support until an in- house capability is
available. Interim contractor

support is typically funded from the procurement appropriation as
part of the acquisition program until an internal Air Force
maintenance capability is available; once available, the Air Force
maintenance capability is paid for largely through the operation
and maintenance appropriation. The Air Force cost estimate for
maintenance contracts is based on use of interim contractor
support through fiscal year 2003. Because the Air Force delayed
the purchase of selected depot support equipment needed to achieve
the internal Air Force maintenance capability, it will require
greater reliance on the contractor for depot support during fiscal
years 2001 through 2003. Air Force officials pointed out that
operation and maintenance funds that would have been used to pay
for this support effort will no longer be

required, but they could not provide an estimate for them. The Air
Force has identified a requirement for 13 portable shelters to
maintain low observable features of the B-2A at locations other
than the main operating base. The Air Force does not have a firm
price for the

shelters, and the initial contractor estimates are higher than the
Air Force expected. If the shelters ultimately cost more than
expected, the current cost estimate will not be adequate to buy
the required number of shelters. This would create additional
funding requirements for the B-2A program and cause the March 1999
cost estimate to increase.

Agency Comments and Our Evaluation

In commenting on the draft of this report, the Department of
Defense (DOD) agreed that the four primary areas of deficiency
discussed in the report AFMSS, defensive avionics, low observable
features, and operational capability when deployed require
additional effort to meet desired performance levels. DOD
commented, however, that more progress had been made in some of
these areas than was indicated in the draft report. We added
information concerning test results that were reported

for AFMSS after the release of our draft report to DOD for
comment. DOD commented that we misinterpreted Air Force cost
estimates for work required to complete the baseline acquisition
program. In particular, DOD

B-280223 Page 12 GAO/NSIAD-99-97 Defense Acquisitions

said costs of certain improvement efforts should not be counted
against the baseline goal. Our report discusses the added costs to
improve the B-2A. We did not attempt to define the amount of costs
associated with a baseline cost goal because the Congress removed
the cost ceiling associated with the baseline program.

DOD also provided technical comments, which were incorporated as
appropriate. DOD comments are included in appendix I. Scope and
Methodology

To evaluate the status of aircraft deliveries, modifications, and
achievement of operational requirements, we reviewed program
office management plans, progress reports, and schedules. We also
reviewed testing and progress assessment reports by the B-2A
program office, the Air

Combat Command, and the 509 th B-2A Operational Wing on the status
of modifying and correcting deficiencies to bring all B-2As into
the planned block 30 operational configuration. We also reviewed
progress assessments by the Air Force in achieving the operational
requirements necessary to

achieve the full operating capability requirement by its scheduled
date in 1999. To obtain more detailed information and discuss
matters of concern in these review areas, we also interviewed
officials in the B-2A Program Offices at Wright- Patterson Air
Force Base, Dayton, Ohio, and at Tinker Air

Force Base, Oklahoma; the Global Attack Office, Air Combat
Command, Langley Air Force Base, Virginia; the 509 th Bomb Wing,
Whiteman Air Force Base, Missouri; and Air Force and Office of the
Secretary of Defense in the Pentagon, Washington, D. C.

To identify cost issues and the potential for increases in the
current B-2A program cost estimate, we reviewed B-2A program cost
estimates, budgets, funding plans, and assessments of the Air
Force's ability to execute the current program and contracts
within estimated costs. We also reviewed contract management
reports on the status of contractor performance in

meeting contract schedules within estimated costs. We interviewed
B-2A Program and Air Combat Command program and financial managers
to discuss the adequacy of current cost estimates, estimating
assumptions,

issues of concern, and the need and schedule for additional costs
to complete the program.

We performed our review from June 1998 to March 1999 in accordance
with generally accepted government auditing standards.

B-280223 Page 13 GAO/NSIAD-99-97 Defense Acquisitions

We are sending copies of this report to the Honorable William
Cohen, Secretary of Defense; the Honorable F. Whitten Peters,
Acting Secretary of the Air Force; the Honorable Jacob Lew,
Director of Office of Management and Budget; and other interested
parties. We will make copies available to others upon request.

Please contact me at (202) 512- 4841 if you or your staff have any
questions concerning this report. Major contributors to this
report are listed in appendix II.

Louis J. Rodrigues Director, Defense Acquisitions Issues

B-280223 Page 14 GAO/NSIAD-99-97 Defense Acquisitions

List of Congressional Committees The Honorable John W. Warner
Chairman The Honorable Carl Levin Ranking Minority Member
Committee on Armed Services United States Senate

The Honorable Ted Stevens Chairman The Honorable Daniel K. Inouye
Ranking Minority Member Subcommittee on Defense Committee on
Appropriations United States Senate

The Honorable Floyd D. Spence Chairman The Honorable Ike Skelton
Ranking Minority Member Committee on Armed Services House of
Representatives

The Honorable Jerry Lewis Chairman The Honorable John P. Murtha
Ranking Minority Member Subcommittee on Defense Committee on
Appropriations House of Representatives

Page 15 GAO/NSIAD-99-97 Defense Acquisitions

Page 16 GAO/NSIAD-99-97 Defense Acquisitions

Contents Letter 1 Appendix I Comments From the Department of
Defense

18 Appendix II Major Contributors to This Report

22 Related GAO Products 24 Table Table 1: March 1999 Assessment of
Achieving

Operational Requirements 4 Figure Figure 1: Overview of B-2A
Acquisition Schedule

as of January 1999 3

Abbreviations

AFMSS Air Force Mission Support System CLOAR common low observable
auto- router DOD Department of Defense FOC Full Operating
Capability

Page 17 GAO/NSIAD-99-97 Defense Acquisitions

Page 18 GAO/NSIAD-99-97 Defense Acquisitions

Appendix I Comments From the Department of Defense Appe ndi x I

Note: GAO comments supplementing those in the report text appear
at the end of this appendix

See comment 1. See comment 2.

See comment 3.

Appendix I Comments From the Department of Defense

Page 19 GAO/NSIAD-99-97 Defense Acquisitions

See comment 4. See comment 5.

Appendix I Comments From the Department of Defense

Page 20 GAO/NSIAD-99-97 Defense Acquisitions

The following are our comments on the Department of Defense's
(DOD) letter dated April 28, 1999.

GAO Comments 1. The Air Force completed some testing of an
upgraded Air Force Mission Support Systems (AFMSS) since our draft
report was issued. However, an

important component of the system, the common low observable
autorouter (CLOAR), is still unsatisfactory and improvements are
being made to system software. This component will in some cases
prevent mission plans from being completed within the
operationally required time. In addition, operational testing of
AFMSS has not been completed. Our final report includes updated
information on the AFMSS development.

2. DOD stated our description of the defensive avionics as
insufficient implied an inability of the B-2A to perform its
mission, whereas B-2As are currently participating in combat
operations. DOD stated some situational awareness information in
current operations was being provided by the defensive avionics.
We changed our report to state situational awareness was limited
rather than insufficient. Although the defensive avionics is being
used to some extent at this time, improvements are still required
to meet the operational requirements.

3. DOD indicated that the wording of the draft report implied
there was an operational requirement for low observable
maintenance man- hours per flying- hour when the requirement is
actually for total B-2 maintenance activities. The final report
reflects this distinction; however, it should be noted that the
Air Force uses maintenance man- hours per flying- hour to measure
maintenance improvements for low observable features. This metric
was used in both the Air Force initial and follow- on operational
test reports to show low observable maintenance is the main driver
for overall B-2 maintenance.

4. DOD stated that B-2As successfully deployed to Guam during two
exercises in 1998 and that during these exercises some low
observable maintenance was accomplished without shelters. The
final report acknowledges that not all low observable maintenance
requires an environmentally controlled shelter, but it points out
that the Air Force follow- on test and evaluation report concluded
that operational deployment requirements were not achieved during
these 1998 exercises and that the lack of shelters would have
prevented any major repair of low

observable features had they been needed. The test report states
that on the second deployment exercise, significant low observable
deficiencies

Appendix I Comments From the Department of Defense

Page 21 GAO/NSIAD-99-97 Defense Acquisitions

occurred and that one of the three aircraft deployed had to be
returned to the contractor's facility in the United States for the
repairs. Although the Air Force can deploy B-2As, the Air Force
cannot sustain operations at the level required for eight aircraft
over a 14- day period without shelters for low observable
maintenance. 5. DOD agreed additional funds would be required to
complete efforts

included in the March 1999 B-2A cost estimate. Their comments
stated, however, that we misinterpreted the Air Force cost
estimate for work to complete the baseline acquisition program. As
stated in the Agency Comments and Our Evaluation section, we
discuss the added costs to

improve the B-2A, but we did not attempt to define the amount of
costs associated with the baseline cost goal because the Congress
removed the cost ceiling associated with the baseline program.
During the formal exit conference, DOD officials also stated that
additional funds might be needed to buy deployable shelters.

Page 22 GAO/NSIAD-99-97 Defense Acquisitions

Appendix II Major Contributors to This Report Appendi x I I

National Security and International Affairs Division, Washington,

D. C. David E. Cooper

Chicago Field Office Robert D. Murphy Michael J. Hazard

Marvin E. Bonner

Page 23 GAO/NSIAD-99-97 Defense Acquisitions

Page 24 GAO/NSIAD-99-97 Defense Acquisitions

Related GAO Products B-2 Bomber: Additional Costs to Correct
Deficiencies and Make Improvements (GAO/NSIAD-98-152, June 16,
1998).

B-2 Bomber: Cost and Operational Issues (GAO/NSIAD-97-181, Aug.
14, 1997).

B-2 Bomber: Status of Efforts to Acquire 21 Operational Aircraft
(GAO/NSIAD-97-11, Oct. 22, 1996). B-2 Bomber: Status of Cost,
Development, and Production (GAO/NSIAD-95-164, Aug. 4, 1995). B-2
Bomber: Cost to Complete 20 Aircraft Is Uncertain (GAO/NSIAD-94-
217, Sept. 8, 1994).

(707352) Lett er

Ordering Information The first copy of each GAO report and
testimony is free. Additional copies are $2 each. Orders should be
sent to the following address, accompanied by a check or money
order made out to the Superintendent of Documents, when necessary,
VISA and MasterCard credit cards are accepted, also.

Orders for 100 or more copies to be mailed to a single address are
discounted 25 percent.

Orders by mail: U. S. General Accounting Office P. O. Box 37050
Washington, DC 20013

or visit: Room 1100 700 4th St. NW (corner of 4th and G Sts. NW)
U. S. General Accounting Office Washington, DC

Orders may also be placed by calling (202) 512- 6000 or by using
fax number (202) 512- 6061, or TDD (202) 512- 2537.

Each day, GAO issues a list of newly available reports and
testimony. To receive facsimile copies of the daily list or any
list from the past 30 days, please call (202) 512- 6000 using a
touchtone phone. A recorded menu will provide information on how
to obtain these lists.

For information on how to access GAO reports on the INTERNET, send
an e- mail message with info in the body to:

info@ www. gao. gov or visit GAO's World Wide Web Home Page at:
http:// www. gao. gov

United States General Accounting Office Washington, D. C. 20548-
0001

Official Business Penalty for Private Use $300

Address Correction Requested Bulk Rate

Postage & Fees Paid GAO Permit No. GI00

*** End of document. ***