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<classification authority="sudocs">GA 1.13:T-NSIAD-98-54</classification>
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 <subject>Contractor performance</subject>
 <subject>Cost overruns</subject>
 <subject>Cost control</subject>
 <subject>Aerospace contracts</subject>
 <subject>Space exploration</subject>
 <subject>Foreign governments</subject>
 <identifier>Russia</identifier>
 <identifier>NASA Space Station Program</identifier>
 <identifier>NASA Space Station Service Module</identifier>
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 <title>Space Station: Cost Control Problems</title>
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<abstract>GAO discussed the cost control problems of the National Aeronautics and
Space Administration&apos;s (NASA) Space Station Program focusing on: (1)
cost growth under the prime contract; (2) the impact on NASA of the
Russians&apos; performance problems; and (3) the need to review the program
and consider funding limitations.&lt;p/&gt;GAO noted that: (1) it had previously reported on the deteriorating cost
and schedule performance of the space station&apos;s prime contractor, Boeing
Defense and Space Group, and identified an emerging risk to the
program--the indications of problems in the Russian government&apos;s ability
to meet its commitment to furnish a Service Module providing the station
with power, control, and habitation capability; (2) since then, the
prime contract deterioration has continued and the Service Module delay
has cost NASA at least several hundreds of millions of dollars, with the
potential for costing considerably more should the Russians falter
again; (3) cost growth is especially worrisome because the rate of cost
deterioration has increased; (4) Boeing has more than doubled its
estimate of the total cost growth at contract completion from $278
million to $600 million, and NASA has increased its total cost growth
estimate to $817 million; (5) both NASA and Boeing recognize the
seriousness of the cost growth issue and have taken actions to address
it; (6) the Russian&apos;s delay in providing the Service Module has already
increased NASA&apos;s cost by over $300 million; (7) the program&apos;s cost could
increase further by as much as several billions of dollars or more,
depending on the severity of Russia&apos;s shortfall and the response to that
shortfall by NASA and its other international partners; (8) NASA
officials believe that the December 1998 launch date for the Service
Module can still be met; (9) the space station program&apos;s financial
reserves have dwindled; (10) NASA has periodically adjusted the
program&apos;s pace and content to comply with an administratively imposed
funding cap and to replenish the program&apos;s financial reserves; and (11)
some of NASA&apos;s actions have made the value of the cap as a funding
control mechanism questionable.</abstract>
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<identifier type="preferred citation">GAO/T-NSIAD-98-54</identifier>
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<note>Testimony</note>
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<subject>
 <topic>Contractor performance</topic>
 <topic>Cost overruns</topic>
 <topic>Cost control</topic>
 <topic>Aerospace contracts</topic>
 <topic>Space exploration</topic>
 <topic>Foreign governments</topic>
 <topic>Russia</topic>
 <topic>NASA Space Station Program</topic>
 <topic>NASA Space Station Service Module</topic>
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