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GAO Releases Report Critical of NASA, Citing Financial Risks Involved With CEV Acquisition

Press Release From: House Committee on Science, Space, and Technology
Posted: Wednesday, July 26, 2006

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WASHINGTON - Today the Government Accountability Office (GAO), an independent investigative arm of Congress, issued a report criticizing the National Aeronautics and Space Administration's (NASA's) acquisition strategy for the Crew Exploration Vehicle (CEV), which is slated to replace the Space Shuttle. The report had been requested by Science Committee Chairman Sherwood Boehlert (R-NY) and Ranking Member Bart Gordon (D-TN) several months ago.

"The GAO report raises legitimate concerns about NASA's approach and will serve as an important oversight tool for the Committee," said Boehlert. "It is very important that Congress keep a close eye on CEV costs to make sure that they do not hamper the agency's other activities. This GAO report, therefore, is cause for concern, and I expect to hold a hearing on it in the fall. NASA and its contractors have performed admirably to this point and I am eager to see NASA continue planning and designing the CEV. However, I share GAO's concern about the need to obtain full information before entering into long-term commitments."

The report, NASA: Long-Term Commitment to and Investment in Space Exploration Program Requires More Knowledge (GAO-06-817R), recommends that Congress restrict annual appropriations for the CEV project, arguing that, "NASA's acquisition strategy for the CEV places the project at risk of cost overruns, schedule delays, and performance shortfalls, because it commits the government to a long-term product development effort before establishing a sound business case." The report notes that NASA plans to select a primary industry partner a year and a half before committing to a final design or cost estimate for the project, potentially exposing the government to unknown, long-term financial risks.

Furthermore, in addition to the potential for significant cost growth, GAO finds that the current 2007 budget proposal is insufficient to support the exploration architecture. "On an annual basis, NASA cannot afford to implement the architecture, although cumulatively, for fiscal years 2007-2011 the agency says it has the money available."

CLICK HERE to view the full text of the GAO report.

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