The Insider

By John Liang
April 4, 2011 at 7:45 PM

David Ahern, the head of portfolio systems procurement in the Pentagon's acquisition shop, recently gave lawmakers an update on the Missile Defense Executive Board's activities over the past two years.

Since 2009, the MDEB has conducted 12 meetings and the Pentagon acquisition chief's office "has issued 12 Acquisition Decision Memorandums," according to Ahern's March 31 prepared remarks to the House Armed Services strategic forces subcommittee. "Thus, it continues to meet more frequently than a Defense Acquisition Board (DAB) would meet for a typical program. Through the MDEB, the department maintains early and continued visibility into MDA programs and is able to provide the necessary guidance to achieve missile defense priorities within cost and schedule constraints," he adds.


The Department's current criteria for missile defense element production decisions includes: an assessment of the depth and breadth of preparation including element progress; performance validated by testing results; reports by the Director, Operational Test and Evaluation; funding to support program plans; and an executable plan for operation and support. MDA, in conjunction with the designated Lead Military Department makes the recommendation for a production decision. The USD(AT&L) is responsible for the production review and decision. In the past year, the MDEB reviewed development progress on the Terminal High Altitude Area Defense (THAAD) element of the Ballistic Missile Defense System, and endorsed the acquisition of THAAD Batteries 3, 4 and 5 and associated equipment. A similar review of the Aegis Ballistic Missile Defense element is also planned.

Recent MDEB activities have also included reviews of the Fiscal Year 2012 Missile Defense Agency budget request, clarification of Operation and Support (O&S) funding responsibilities, and force structure recommendations such as the addition of an AN/TPY-2 radar to BMDS acquisition planning. The MDEB also established a Defense Science and Technology Advisory Group which reviews and assesses critical technologies that support missile defense missions and their maturity levels.

In February, Inside the Pentagon had more detail about the MDEB meeting on the radar addition:

Pentagon acquisition chief Ashton Carter has endorsed buying an additional AN/TPY-2 radar in fiscal year 2012 for the Ballistic Missile Defense System, according to internal documents.

A Jan. 31 acquisition decision memorandum signed by Carter and reviewed by Inside the Pentagon says the department will add one AN/TPY-2 radar in FY-12 to the Missile Defense Agency's Ballistic Missile Defense System program acquisition plan "pending availability of additional funding."

The "for official use only" memo -- addressed to the Pentagon's policy shop, the armed services and the Missile Defense Agency -- lays out decisions stemming from a Nov. 1, 2010, Missile Defense Executive Board (MDEB) meeting chaired by Carter.

Raytheon has built seven AN/TPY-2 radars. Late last year, the agency awarded Raytheon a $190 million contract to build an eighth radar. The program of record calls for building a total of 14 radars by 2015.

An industry source said nothing has been announced yet, but the department has been discussing the possibility of boosting the planned quantity to 15 radars based on the needs of combatant commanders.

By Christopher J. Castelli
April 1, 2011 at 6:36 PM

NATO today issued an update on its military intervention in Libya. On March 27, the alliance opted to take control of all military operations against the Libyan government under United Nations Security Council Resolutions 1970 and 1973. NATO's Operation Unified Protector aims to protect civilians and civilian-populated areas under attack or threat of attack, a mission that includes an arms embargo, a no-fly-zone and "actions to protect civilians from attack or the threat of attack," according to the update.

Since the beginning of the NATO operation (31 March 2011, 08.00 GMT), a total of 178 sorties have been conducted, including 74 strike sorties, NATO says. In terms of arms embargo activities, a total of 17 ships under NATO command are actively patrolling the Central Mediterranean, NATO says, noting two vessels have been hailed to determine destination and cargo but no boardings were required.

NATO’s operational commander for Operation Unified Protector is Lt. Gen. Charles Bouchard of the Canadian air force at the Joint Force Command in Naples, Italy.

By Christopher J. Castelli
March 31, 2011 at 10:32 PM

U.S. Joint Forces Command chief Gen. Raymond Odierno today defended plans to disestablish JFCOM, noting key functions would move to the Joint Staff's J-7, J-3 and J-8 directorates. Rep. Randy Forbes (R-VA), the House Armed Services readiness subcommittee chairman, criticized the planned changes at a hearing on the subject, but Odierno argued strides in jointness over the years show JFCOM is no longer needed.

"We're much better at [jointness] today than we were ten or 15 years ago," Odierno said, adding that Defense Secretary Robert Gates "believes, and I believe, it is no longer necessary to have a four-star command to oversee the process of jointness."

Under the new construct, "key functions and missions will now be linked together in a more efficient and effective manner under the Deputy Director Joint Staff J-7 for Joint and Coalition Warfare -- an organization that provides a one-stop-shop for preserving jointness and developing the joint force." according to Odierno's prepared testimony.

JFCOM's joint force provider role will go to the Joint Staff's J-3 directorate. JFCOM's Joint Capability Development and Integration (J-8) shop will "merge essential elements of the Joint Systems Integration Center and Joint Fires Integration and Interoperability Team into the organization to provide a comprehensive systems requirements identification and assessment capability," and will be reassigned to the Joint Staff's Force Structure, Resources, and Assessment (J-8) directorate, the testimony states.

By Jordana Mishory
March 31, 2011 at 9:27 PM

Russia and the United States are “moving forward” in their cooperation on missile defense despite sharing similar concerns, a senior Pentagon official told a House panel today.

“We see strong Russian leadership interest in moving forward with missile defense cooperation with the United States and NATO as reflected in presidential and prime ministerial statements,” said Bradley Roberts, the deputy assistant secretary of defense for nuclear and missile defense policy. He noted that there is also “supporting activities in the various ministries” that coincides with this senior-level commitment.

Roberts stated that both sides are concerned about sharing classified information with one another, and that Russia is also concerned about some of its technology. He did not elaborate.

Roberts’ comment came during a House Armed Services strategic forces subcommittee hearing on the missile defense budget request. The subcommittee’s ranking member, Loretta Sanchez (D-CA), asked Roberts how things were progressing with America's former Cold War adversary.

“The short answer would be that we perceive that they are approaching this cooperative effort in a constructive, pragmatic way and with some realistic expectations about what we might be able to accomplish,” Roberts said, noting, however, that most of the details should be provided in a different venue because the "state of discussions is sensitive."

By Christopher J. Castelli
March 31, 2011 at 1:51 PM

Pentagon spokesman Capt. Darryn James yesterday provided an update on the number of strikes and sorties in the U.S. and coalition military operations against Libya's government (as of 6:00 a.m. EST March 30).

He said that in the last 24 hours the U.S. military fired two Tomahawk missiles and coalition and U.S. forces conducted 188 sorties -- 102 of which were "strike" sorties (61 by coalition aircraft; 41 by U.S. aircraft). Also in the last 24 hours, NATO conducted 19 defensive counterair sorties, all in support of the no-fly zone (no U.S. flights are counted in NATO/Operation Unified Protector numbers), he said.

For the overall operation in Libya, coalition forces have conducted 784 stories (including 489 strikes) and U.S. forces have conducted 1,206 (including 463 strikes), he said, noting U.S. forces have launched a total of 216 Tomahawk missiles and coalition forces have launched seven. Defense Secretary Robert Gates and Chairman of the Joint Chiefs of Staff Adm. Michael Mullen are testifying this morning before the House Armed Services Committee concerning the intervention in Libya. In his opening statement, Gates said the security and prosperity of the United States is linked to the security and prosperity of the broader Middle East.

“I believe it was in America’s national interests -- as part of a multilateral coalition with broad international support -- to prevent a humanitarian crisis in Eastern Libya that could have destabilized the entire region at a delicate time,” Gates said. “And, it continues to be in our national interest to prevent Qadhafi from visiting further depredations on his own people, destabilizing his neighbors, and setting back the progress the people of the Middle East have made in recent weeks.”

By Dan Dupont
March 30, 2011 at 5:39 PM

Rep. Randy Forbes (R-VA), chairman of he House Armed Services readiness subcommittee, plans a "roundtable hearing" on "the future of jointness in the Armed Services and its critical relationship to the readiness posture of the nation’s armed forces," he said today.

It's clear from his statement that the hearing, slated for tomorrow (March 31), will have a lot to do with U.S. Joint Forces Command, the closure of which Forbes has staunchly opposed:

"As the United States prepares to shutter the nerve center of its joint military operations at Joint Forces Command (JFCOM), it is imperative that Congress work with the armed services to ensure that jointness is not only maintained, but more importantly, that jointness is improved upon and advanced. There is still much work to be done in developing jointness in areas like communication, weapon systems procurement, and logistics processes and information systems. This hearing will serve as a means by which we construct a legal and practical framework for continuing to enforce a joint structure within the armed services and enhancing joint capabilities in the future,” Forbes said.

The witnesses:

  • Gen. Raymond Odierno, commander of JFCOM
  • Vice Adm. William Gortney, director of the Joint Staff
  • Andrew Krepinevich, president of the Center for Strategic and Budgetary Assessments

The statement continues:

In a recent speech at the Air Force Academy, Secretary Gates said, "It's easier to be joint and talk joint when there's money to go around and a war to be won. It's much harder to do when tough choices have to be made within and between the military services - between what is ideal from a particular service perspective, and what will get the job done, taking into account broader priorities and considerations."

In light of Secretary Gates' comments, Congressman Forbes and members of the subcommittee will discuss those priorities and considerations to ensure that jointness is not forfeited due to budgetary concerns.

By John Liang
March 30, 2011 at 3:21 PM

House Armed Services Committee Chairman Howard McKeon (R-CA) today announced his panel would hold a hearing tomorrow on U.S. military operations in Libya.

Defense Secretary Robert Gates and Chairman of the Joint Chiefs of Staff Adm. Mike Mullen will testify Thursday at 9:00 a.m., according to a committee statement, which adds:

On Monday night, the President provided the nation an update on operations in Libya and announced that the military mission will be transferred from the United States to NATO this week.

Reacting to the President's address, McKeon raised several concerns, including the lack of "a clearly defined goal for how long military operations will last in Libya."

McKeon also noted the political reality that "utilizing U.S. warriors to protect civilians from a brutal dictator is a noble cause, but asking them to maintain a stalemate while we hold-out hope that [Moammar] Qaddafi will voluntarily leave his country raises serious questions about the duration of the mission."

At tomorrow’s hearing, members of the House Armed Services Committee will have an opportunity to hear directly from the Pentagon’s top civilian and military leaders on these concerns and have specific questions answered about the duration, cost and long-term objectives of the mission.

By John Liang
March 29, 2011 at 6:33 PM

The Defense Department fell short of many of its fiscal year 2010 energy reduction and renewable energy goals established by law or executive order, but far exceeded a 2010 goal for lowering its water consumption, Defense Environment Alert reports today, citing testimony submitted to the Senate earlier this month by a high-level Pentagon official.

"Although the department is steadily improving its installation energy performance, we have failed to meet key statutory and regulatory goals for the last two years," Deputy Under Secretary of Defense for Installations and Environment Dorothy Robyn states in written testimony submitted to the Senate Armed Services readiness and management support subcommittee for a hearing that was held March 17 on military construction, environmental and base realignment and closure programs. Specifically:

Overall, the entire Defense Department lowered its energy intensity by 11.2 percent between 2005 and 2010, missing a goal of 15 percent reduction, according to Robyn. Under the Energy Independence and Security Act of 2007, DOD is to lower its energy intensity, measured in British Thermal Units per square foot, by 3 percent per year, or 30 percent overall, from the baseline year of 2003 to 2015.

A key factor in missing this goal resulted from the demands placed on the Army to move troops and equipment to and from Afghanistan and Iraq and to complete the base closure process, where in some cases, the Army has been running electricity in both the closing facilities and the facilities it is transitioning to, Robyn says. The news comes as the Army less than a year ago publicly said it had fallen behind in FY-09 in meeting the energy goals for both energy conservation and renewable energy purchases at its facilities, prompting staff to notify senior leaders that more was needed to advance efforts to meet the goals. . . .

During oral testimony before the subcommittee March 17, Robyn noted that DOD is working on a guidance to require the services to meter a higher fraction of their buildings' energy consumption, something she said the Navy is already doing. "We are very data starved," she said, adding that this is an area where DOD needs to know how much it is consuming in order to make progress. DOD is also leading an effort to launch an energy management system that cuts across the services, she told the subcommittee.

Meanwhile, on the renewable energy front, DOD increased its consumption of renewable energy to 4.1 percent, but fell short of a goal under the Energy Policy Act (EPACT) of 2005 to have at least 5 percent of its electricity use come from renewable energy by 2010, Robyn states. Under EPACT, DOD must meet the 5 percent mark in renewable electricity purchases in 2010-2012, and then must increase its use of renewable energy to 7.5 percent of total electricity consumption in 2013 and beyond. Also, under defense law, it is to produce or procure 25 percent of its electricity from renewable sources by the end of 2025. DOD, however, is on target to meet this latter goal, Robyn's testimony states.

The Air Force appears to be on track with regard to both the renewable energy and reduced energy intensity goals. The service contends it has already lowered its facility energy use by nearly 15 percent from 2003 levels, according to written testimony submitted March 17 to the same subcommittee by Air Force Assistant Secretary for Installations, Environment and Logistics Terry Yonkers. In addition, he states the Air Force exceeded its goals "and produced or procured nearly 7 percent of our total facility energy from renewable sources," leading among the services as the top purchaser of renewable energy for the fifth year in a row.

The news on renewable energy purchasing comes as DOD has just released an acquisition rule that gives DOD longer-term contract authority to purchase renewable energy electricity, but sources doubt it will spur significant industry interest in making such contracts, saying much longer contract terms than the 10 years allowed are needed. . . .

DOD says it also failed to achieve its target to lower its consumption of petroleum by non-tactical vehicles. "DOD achieved a 6.6 percent reduction in its petroleum use from the 2005 baseline, compared to the target of 10 percent," Robyn states in her written testimony. Under a 2009 executive order, DOD is to reduce its consumption of petroleum in non-tactical vehicles by 30 percent by FY20, as compared to FY05.

"The Department continues to pursue replacement of non-tactical fleet vehicles with more efficient models, alternative fuel vehicles and hybrid electric vehicles to decrease petroleum fuel demand," Robyn's testimony reads.

To get back on track in meeting its energy mandates, DOD plans to use a combination of government funds and alternative financing mechanisms, recognizing that "[t]he amount of investment needed to fully fund requirements to meet energy mandates far exceeds the amount of available appropriated DoD funding," a DOD spokeswoman stated in a written response to questions.

At the same time, DOD "far exceeded" its goal for 2010 to lower its potable water consumption, according to the spokeswoman. It lowered its potable water consumption intensity by 13 percent from 2007 to 2010, as compared to the goal of 6 percent, she wrote. In contrast, from 2007 to 2009, DOD lowered its water consumption at its facilities by 4.6 percent. "This dramatic improvement is due to the combination of an aggressive program to detect leaks followed up by a program to repair them," she wrote. Under an executive order, DOD must reduce its water consumption intensity by 16 percent by the end of FY-15, using an FY-03 baseline.

Executive orders require DOD to meet a goal of reducing potable water consumption intensity by 2 percent per year, with the latest order requiring these reductions to occur through FY-20, using a baseline year of 2007.

By Christopher J. Castelli
March 29, 2011 at 5:22 PM

U.S. military operations in Libya have cost roughly $550 million to date, Pentagon spokeswoman Cmdr. Kathleen Kesler said today.

"DOD has incurred added costs of about $550 million from the start of operations through March 28," she said. "About 60 percent of these added costs are for munitions; the remaining costs are for higher operating tempo of U.S. forces and deployment costs."

While the Pentagon anticipates future costs tied to the operation, the ultimate cost to the department remains unclear.

"Future costs are highly uncertain," Kesler said. "However, we expect to incur added costs of about $40 million over the next three weeks as U.S. forces are reduced and NATO assumes more responsibility. After that, if U.S. forces stay at the levels currently planned and the operation continues, we would incur added costs of about $40 million per month."

By John Liang
March 29, 2011 at 2:46 PM

The Missile Defense Agency has awarded Lockheed Martin's Space Systems division a contract worth nearly $695 million to build and deliver 48 interceptors and ground-support equipment for batteries 3 and 4 of the Terminal High Altitude Area Defense system, according to a Federal Business Opportunities notice issued this morning. The contract -- a "fixed price incentive and cost-plus-fixed-fee modification" -- has a performance period through December 2013.

Last week, MDA announced via FedBizOpps that the agency would "negotiate on a sole source basis" with Lockheed "for the manufacturing of THAAD Production Lot 3." Specifically:

The contracting approach for this manufacturing effort will be to modify the existing Fire Unit Fielding (FUF) Contract HQ0147-07-C-0196. Contract HQ0147-07-C-0196 requires manufacturing, delivery and integration of the THAAD components for fire unit fielding and initial spares. The THAAD Fire Unit Fielding (FUF) components are comprised of the THAAD Launcher, THAAD Fire Control and Communications (TFCC), Interceptors, and Peculiar Support Equipment (PSE). Quantities for Production Lot 3 to be procured are a maximum of 18 launchers, 68 interceptors, 1 Fire Control Suite, and associated PSE. This action is expected to be awarded in 2nd quarter FY12.

The proposed acquisition is directed to LMSSC pursuant to the authority of 10 USC 2304(c)(1) as implemented by FAR 6.302-1(a)(2)(ii), (iii) and (b)(1)(ii). Only one responsible source and no other supplies or services will satisfy agency requirements. LMSSC is the only source that currently possesses the in-depth technical knowledge of the THAAD system requirements to satisfactorily perform the work contemplated herein within the needed timeframe. No other source has access to the required technical data and resident expertise to perform the described effort. This expertise cannot be attained by any other contractor within the anticipated period of performance without incurring an unacceptable delay and risk to the overall program in fulfilling these agency requirements and mission and without incurring a substantial duplication of costs. LMSSC is the system prime contractor for three other THAAD system developmental efforts: Contract DASG60-92-C-0101 ($1.4B), DASG60-00-C-0072 ($6B) and THAAD Field Support Contract HQ0197-10-D-0001 ($435M). Contract DASG60-00-C-0072 will continue through FY11 and the work under this proposed contract action must be completely compatible and fully integrated with the work under the other THAAD development contracts. Only LMSSC is capable of manufacturing the identified THAAD components, combining them into fire units, and successfully integrating these tasks with prior and on-going development work on the THAAD System.

By John Liang
March 28, 2011 at 5:06 PM

The Pentagon last week issued a "directive-type memorandum" that seeks "to immediately enhance reliability in the acquisition process and . . . improve the efficiency of the Defense acquisition system." The memo "is designed to improve reliability analysis, planning, tracking, and reporting" and "[i]nstitutionalizes reliability planning methods and reporting requirements timed to key acquisition activities to monitor reliability growth."

The March 21 memo, signed by Frank Kendall from the Defense Department's acquisition shop and directed to the senior DOD leadership, establishes the following procedures:

1. Program Managers (PMs) shall formulate a comprehensive reliability and maintainability (R&M) program using an appropriate reliability growth strategy to improve R&M performance until R&M requirements are satisfied. The program will consist of engineering activities including: R&M allocations, block diagrams and predictions; failure definitions and scoring criteria; failure mode, effects and criticality analysis; maintainability and built-in test demonstrations; reliability growth testing at the system and subsystem level; and a failure reporting and corrective action system maintained through design, development, production, and sustainment. The R&M program is an integral part of the systems engineering process.

2. The lead DoD Component and the PM, or equivalent, shall prepare a preliminary Reliability, Availability, Maintainability, and Cost Rationale Report in accordance with Reference (c) in support of the Milestone (MS) A decision. This report provides a quantitative basis for reliability requirements and improves cost estimates and program planning. The report shall be attached to the Systems Engineering Plan (SEP) at MS A and updated in support of MS B and C.

3. The Technology Development Strategy preceding MS A and the Acquisition Strategy preceding MS B and C shall specify how the sustainment characteristics of the materiel solution resulting from the analysis of alternatives and the Capability Development Document sustainment key performance parameter thresholds have been translated into R&M design requirements and contract specifications. The strategies shall also include the tasks and processes to be stated in the request for proposal that the contractor will be required to employ to demonstrate the achievement of reliability design requirements. The Test and Evaluation Strategy and the Test and Evaluation Master Plan (TEMP) shall specify how reliability will be tested and evaluated during the associated acquisition phase.

4. Reliability Growth Curves (RGC) shall reflect the reliability growth strategy and be employed to plan, illustrate, and report reliability growth. A RGC shall be included in the SEP at MS A, and updated in the TEMP beginning at MS B. RGC will be stated in a series of intermediate goals and tracked through fully integrated, system-level test and evaluation events until the reliability threshold is achieved. If a single curve is not adequate to describe overall system reliability, curves will be provided for critical subsystems with rationale for their selection.

5. PMs and operational test agencies shall assess the reliability growth required for the system to achieve its reliability threshold during initial operational test and evaluation and report the results of that assessment to the Milestone Decision Authority at MS C.

6. Reliability growth shall be monitored and reported throughout the acquisition process. PMs shall report the status of reliability objectives and/or thresholds as part of the formal design review process, during Program Support Reviews, and during systems engineering technical reviews. RGC shall be employed to report reliability growth status at Defense Acquisition Executive System reviews.

By Jason Sherman
March 28, 2011 at 2:05 PM

The F-35 joint program office late Friday night announced the Joint Strike Fighter test flight program -- suspended more than two weeks ago following the in-flight failure of a key component -- is resuming in full:

The three remaining F-35 test aircraft with the production alternate engine starter/generator (AES/G) configuration, as well as the first two production aircraft, will resume flight operations.

This action follows a thorough analysis of a March 9 in-flight dual generator failure on AF-4 during a test flight at Edwards AFB, Calif.  During the March 9 flight, the aircraft backup electrical generator came on line as designed and the test pilot was able to return the jet safely back to base.

Flight clearance was reinstated after an investigation and test data indicated a maintenance procedure resulted in excess oil remaining within the AES/G lubrication system. Previous maintenance procedures could allow a small amount of extra oil to remain within the generator following servicing.  Under some conditions, the extra oil that is churning inside a narrow air gap within the AES/G could cause internal temperatures to increase.  It was assessed that high temperatures led to the generator failures. Maintenance documents have been amended to provide improved engine starter/generator servicing procedures.

There are two primary generator configurations used on the F-35 - the ES/G (Engine Starter / Generator) which is used on AF-1/2/3, BF-1/2/3/4 and a newer production item known as AES/G (Alternate Engine Starter/Generator) which was installed in AF-4, BF-5, CF-1 and all Low Rate Initial Production (LRIP) aircraft. Both generators provide the functions of engine start and primary electrical power generation in the overall architecture.

There was no significant impact to the System Development and Demonstration (SDD) program or production operations. Flight test schedules are built with a margin for precautionary safety stand-downs. After it was determined the dual generator failure was unique to aircraft with the AES/G configuration, seven SDD jets (AF-1/2/3, BF-1/2/3/4) were cleared to return to flight on March 14. The F-35 test programs at Edwards AFB, Calif. and Naval Air Station Patuxent River, MD remain ahead of their monthly flight test schedules.

By John Liang
March 25, 2011 at 8:32 PM

The Government Accountability Office released an annual report today evaluating the Missile Defense Agency's progress in improving the way the agency handles cost, schedule, testing and performance in developing the various components of the Ballistic Missile Defense System.

The 124-page report includes 10 recommendations for MDA "to strengthen its baselines, facilitate external and independent reviews of those baselines, ensure effective oversight of the BMDS, and further improve transparency and accountability of its efforts."

To make the baselines MDA reports to Congress clearer, more consistent and complete, GAO recommends the agency take the following actions:

1. For resource baselines:

a) Provide more detailed explanations and definitions of information included in resource baselines; particularly operations and support costs and unit cost calculations.

b) Label cost estimates to appropriately reflect the content reported and explain any exclusions.

c) Include all sunk costs in all of its cost estimates and baselines.

d) Obtain independent cost estimates for each baseline.

e) In meeting new statutory requirements to include a cost estimate in each acquisition baseline for a program element, take steps to ensure these cost estimates are high quality, reliable cost estimates that are documented to facilitate external review.

2. For schedule baselines:

a) In meeting new statutory requirements to report on an acquisition baseline including a comprehensive schedule, include a comprehensive list of actual versus planned quantities of assets that are or were to be delivered each fiscal year.

b) In meeting new requirements to report variances on acquisition baselines, report on variances of these quantities by fiscal year and the reasons for these differences.

3. For test baselines:

a) In meeting new statutory requirements to report variances between reported acquisition baselines, also report variances between the test plan as presented in the previous acquisition baseline and the test plan as executed that explain the reason for any changes.

b) Report the cost effects of those test changes in either the BAR or the budget justification documentation.

In order to stabilize the test plan and ensure the test baseline can absorb test failures and test delays and remains executable, the Secretary of Defense should ensure that the Missile Defense Agency:

4. Includes sufficient schedule and resource margin, including spare test assets and targets, based on recent test experience and forecasted testing demands.

The GAO report also notes the Pentagon's responses to the recommendations in an earlier draft of the report:

DOD fully concurred with 7 of our 10 recommendations, including our recommendations to take steps to ensure its cost estimates are high-quality, reliable cost estimates that are documented to facilitate external review. In response to this recommendation, DOD stated that MDA will follow the GAO Cost Estimating and Assessment Guide for each program reported in the [BMDS Accountability Report]. In doing so, MDA Cost Estimating and Analysis Directorate plans to form a cost assessment group to formally assess each cost estimate to ensure they are well documented, comprehensive, accurate, and credible. DOD also fully concurred with our recommendation to report the cost effects of its test changes in either the BAR or budget justification documentation, stating that MDA will provide the cost effects as part of the individual program resource baselines starting in the 2012 BAR.

DOD partially concurred with our recommendation that the Secretary of Defense direct MDA to include all sunk costs in all of its cost estimates and baselines. DOD stated that MDA will continue to report sunk costs in most of its acquisition programs except targets, where it will continue to report unit costs in the same manner as the 2010 and 2011 BARs. According to DOD, because each target is inherently a test article and no two are identical, there are always variable non-recurring costs associated with each article. Also, due to the extensive reuse of previous strategic missile components in the targets program, including all sunk costs does not reflect MDA program costs accurately. Accordingly, MDA will use the costs incurred/planned during the future years defense plan to calculate unit costs. These unit costs will not include any sunk costs. We continue to believe that all costs, including all sunk costs incurred for individual target efforts, should be reported to the maximum extent possible, regardless of the agency or service that originally incurred those costs. To the extent that a sunk cost, such as the original cost of previous strategic missile components, can not be calculated, that fact should be explained when the costs are reported. Moreover, DOD’s method of reporting and baselining target unit costs will not reflect even MDA program costs accurately because it excludes MDA-incurred sunk costs. Excluding these costs, which can run into the hundreds of millions of dollars, precludes understanding of the full investment required to develop and procure targets, as well as limiting insight into developmental progress. In addition, the incomplete costs reported will be changed every two years because, as DOD noted, MDA uses only the costs for the future years defense plan to calculate the target unit cost baselines. The future years defense plan covers a six year period of time, but changes every two years to a new six year period of time. Calculating unit costs this way provides neither the full cost nor the full quantities of targets as it removes any costs or quantities prior to fiscal year 2010. We therefore continue to believe that including these costs will aid departmental and congressional decision makers as they make difficult choices of where to invest limited resources.

By Christopher J. Castelli
March 25, 2011 at 3:49 PM

The Navy expects to issue the results of its VXX presidential helicopter analysis of alternatives (AOA) in the second quarter of 2011 and seems to be on track to capitalize on lessons learned from the previous VH-71 program, the Government Accountability Office writes in a report issued today.

"While we cannot assess its sufficiency until it is complete, statements by DOD officials on the nature of the AOA effort suggest the pursuit of an acquisition approach in line with best practices, the report states. "Plans are for the AOA to analyze in detail the estimated cost and effectiveness of a range of potential materiel solutions to support the need."

Program officials told GAO they understand the need to establish and maintain a solid business case laying out a balance between requirements, cost and schedule that results in an executable program with acceptable risk.

"To accomplish this, the program intends to use a rigorous four-phase systems engineering and technical review process constituting a more knowledge-based acquisition approach," the report states. "This process differs greatly from the process followed during the VH-71 program. According to VXX program officials, the VXX program’s systems engineering and technical review process will begin earlier during the technology development phase (pre-Milestone B). VXX program officials stated that they plan to enter the systems development phase with a preliminary technical design and possibly an early prototype of subsystems."

By John Liang
March 24, 2011 at 8:21 PM

No, that headline isn't about the 1970s doo-wop band that appeared in the movie musical "Grease." It refers to an Afghan concept of standing "shoulder-to-shoulder" with someone -- a term taught to reporters today by a U.S. military official in Afghanistan in response a question on whether Provincial Reconstruction Teams create a dependency on foreign coalition forces. During the teleconference, Air Force Lt. Col. John "Red" Walker, the commander of the Mehtar Lam Provincial Reconstruction Team in Regional Command-East, said:

One of the things that we've done or one of the -- one of the actions that we've been very cognizantly taking is, all of the PRT actions and all of our processes are nested "shana-ba-shana." I mean, we are really integrated very well with the governor and his staff, so we don't give any opportunity or any projects or development or really any actions without the knowledge and prioritization of that Afghan government entity, whether that's at the district or at the provincial level. And I think that's what President Karzai is getting at, is that the PRTs need to be very well nested with the provincial governor and his staff.

As cooperative as coalition forces have been with their Afghan counterparts, however, senior U.S. military officials have grown increasingly worried about having to continue to operate under a continuing resolution instead of a fiscal year 2011 appropriations bill. As Inside the Pentagon reports today:

Continuing to restrict Defense Department funding under stopgap legislation could complicate the war in Afghanistan by blocking the acquisition of urgently needed military equipment, according to Gen. David Petraeus, the top U.S. commander there.

If Congress does not pass a fiscal year 2011 defense appropriations bill, the restrictions tied to operating under a continuing resolution could prevent the armed services from buying systems such as MQ-9 Reaper drones needed to support troops in Afghanistan, he said March 18 at the Newseum in Washington.

"The CR is not yet complicating our efforts, but there is a point at which it will," he said. "To give you an example, the U.S. Air Force won't be able to buy the additional Reaper unmanned aerial vehicle [combat air patrols] that we have requested on an urgent joint operational needs statement. And then there are similar examples of that."

Inside the Air Force reported March 18 that the Air Force had exhausted its prior-year reprogramming funding, meaning that the planned purchase of 24 more Reaper drones and other equipment would have to wait for further relief from Congress or until a full appropriations bill is passed.

Petraeus noted a multibillion-dollar fund used to plan, program and implement structural, institutional and management changes in Afghan forces could also be impacted. "At a certain point, the Afghan Security Forces Fund," for which the administration is seeking a budget increase, "would be capped at a much lower level," he said.

On March 17, the Senate passed a three-week continuing resolution to fund government operations through April 8. The House previously passed the bill. President Obama signed the legislation March 18.

Petraeus also reiterated his "grave concerns about the inadequate levels of funding" for the State Department and the U.S. Agency for International Development, stressing both organizations have vital work to do in Afghanistan. He recently made the same point in congressional testimony.

"These are national security issues," he said at the March 18 event, sponsored by National Journal. The expertise of, and funding for, the State Department and USAID are needed to "cement the gains on the ground" in Afghanistan, he said.