[House Hearing, 115 Congress]
[From the U.S. Government Publishing Office]
NASA COST AND SCHEDULE OVERRUNS:
ACQUISITION AND PROGRAM
MANAGEMENT CHALLENGES
=======================================================================
HEARING
BEFORE THE
SUBCOMMITTEE ON SPACE
COMMITTEE ON SCIENCE, SPACE, AND TECHNOLOGY
HOUSE OF REPRESENTATIVES
ONE HUNDRED FIFTEENTH CONGRESS
SECOND SESSION
__________
JUNE 14, 2018
__________
Serial No. 115-64
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Printed for the use of the Committee on Science, Space, and Technology
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
Available via the World Wide Web: http://science.house.gov
__________
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COMMITTEE ON SCIENCE, SPACE, AND TECHNOLOGY
HON. LAMAR S. SMITH, Texas, Chair
FRANK D. LUCAS, Oklahoma EDDIE BERNICE JOHNSON, Texas
DANA ROHRABACHER, California ZOE LOFGREN, California
MO BROOKS, Alabama DANIEL LIPINSKI, Illinois
RANDY HULTGREN, Illinois SUZANNE BONAMICI, Oregon
BILL POSEY, Florida AMI BERA, California
THOMAS MASSIE, Kentucky ELIZABETH H. ESTY, Connecticut
RANDY K. WEBER, Texas MARC A. VEASEY, Texas
STEPHEN KNIGHT, California DONALD S. BEYER, JR., Virginia
BRIAN BABIN, Texas JACKY ROSEN, Nevada
BARBARA COMSTOCK, Virginia CONOR LAMB, Pennsylvania
BARRY LOUDERMILK, Georgia JERRY McNERNEY, California
RALPH LEE ABRAHAM, Louisiana ED PERLMUTTER, Colorado
GARY PALMER, Alabama PAUL TONKO, New York
DANIEL WEBSTER, Florida BILL FOSTER, Illinois
JIM BANKS, Indiana MARK TAKANO, California
ANDY BIGGS, Arizona COLLEEN HANABUSA, Hawaii
ROGER W. MARSHALL, Kansas CHARLIE CRIST, Florida
NEAL P. DUNN, Florida
CLAY HIGGINS, Louisiana
RALPH NORMAN, South Carolina
DEBBIE LESKO, Arizona
------
Subcommittee on Space
HON. BRIAN BABIN, Texas, Chair
DANA ROHRABACHER, California AMI BERA, California, Ranking
FRANK D. LUCAS, Oklahoma Member
MO BROOKS, Alabama ZOE LOFGREN, California
RANDY HULTGREN, Illinois DONALD S. BEYER, JR., Virginia
BILL POSEY, Florida MARC A. VEASEY, Texas
STEPHEN KNIGHT, California DANIEL LIPINSKI, Illinois
BARBARA COMSTOCK, Virginia ED PERLMUTTER, Colorado
RALPH LEE ABRAHAM, Louisiana CHARLIE CRIST, Florida
DANIEL WEBSTER, Florida BILL FOSTER, Illinois
ANDY BIGGS, Arizona EDDIE BERNICE JOHNSON, Texas
NEAL P. DUNN, Florida
CLAY HIGGINS, Louisiana
LAMAR S. SMITH, Texas
C O N T E N T S
June 14, 2018
Page
Witness List..................................................... 2
Hearing Charter.................................................. 3
Opening Statements
Statement by Representative Brian Babin, Chairman, Subcommittee
on Space, Committee on Science, Space, and Technology, U.S.
House of Representatives....................................... 4
Written Statement............................................ 6
Statement by Representative Ami Bera, Minority Ranking Member,
Subcommittee on Space, Committee on Science, Space, and
Technology, U.S. House of Representatives...................... 8
Written Statement............................................ 10
Statement by Representative Lamar Smith, Chairman, Committee on
Science, Space, and Technology, U.S. House of Representatives.. 12
Written Statement............................................ 14
Statement by Representative Eddie Bernice Johnson, Ranking
Member, Committee on Science, Space, and Technology, U.S. House
of Representatives............................................. 16
Written Statement............................................ 17
Witnesses:
Ms. Cristina Chaplain, Director, GAO: Contracting and National
Security Acquisitions
Oral Statement............................................... 19
Written Statement............................................ 22
Mr. Steve Jurczyk, Associate Administrator, NASA
Oral Statement............................................... 58
Written Statement............................................ 60
Mr. Paul Martin, Inspector General, NASA
Oral Statement............................................... 68
Written Statement............................................ 70
Mr. Daniel L. Dumbacher, Executive Director, American Institute
of Aeronautics and Astronautics (AIAA)
Oral Statement............................................... 79
Written Statement............................................ 81
Discussion....................................................... 89
Appendix I: Answers to Post-Hearing Questions
Ms. Cristina Chaplain, Director, GAO: Contracting and National
Security Acquisitions.......................................... 112
Mr. Steve Jurczyk, Associate Administrator, NASA................. 122
Mr. Paul Martin, Inspector General, NASA......................... 136
Mr. Daniel L. Dumbacher, Executive Director, American Institute
of Aeronautics and Astronautics (AIAA)......................... 139
Appendix II: Additional Material for the Record
Documents submitted by NASA...................................... 144
NASA COST AND SCHEDULE OVERRUNS:
ACQUISITION AND PROGRAM
MANAGEMENT CHALLENGES
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THURSDAY, JUNE 14, 2018
House of Representatives,
Committee on Science, Space, and Technology,
Washington, D.C.
The Subcommittee met, pursuant to call, at 10:04 a.m., in
Room 2318 of the Rayburn House Office Building, Hon. Brian
Babin [Chairman of the Subcommittee] presiding.
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Chairman Babin. Good morning. The Subcommittee on Space
will come to order.
Without objection, the Chair is authorized to declare
recesses of the Subcommittee at any time.
Welcome to today's hearing titled, ``NASA Cost and Schedule
Overruns: Acquisition and Program Management Challenges.''
I will now recognize myself for five minutes for an opening
statement.
NASA is at a critical juncture as it lays out the details
of its roadmap for human exploration missions while determining
the best business approach to success. However, human
exploration doesn't encompass the breadth of NASA's total work.
They are also launching interplanetary spacecraft systems,
advancing science and aeronautics research, and developing
critical technologies to enable U.S. leadership in space.
Strategic acquisition planning, utilization of new contracting
mechanisms, and improving management and oversight will be a
crucial part of effective, affordable, and sustainable mission
success for NASA.
As Chairman of the Space Subcommittee and a proud
representative of Johnson Space Center in Houston, I am a
tireless advocate for NASA. However, as Members of this
Committee, we have a responsibility to every taxpayer to ensure
that NASA is being a good steward, managing the resources with
which we have been entrusted. Today's hearing will touch upon a
number of important oversight topics, including acquisition
mechanisms, cost-estimation methodologies, and NASA program
management.
Procurements represent over 90 percent of NASA's annual
budget. In fiscal year 2016, NASA procured over $18.6 billion
through nearly 41,000 active procurements. That's a tremendous
amount of work. Unfortunately, NASA has been plagued for years
with contract management issues, which have resulted in
substantial cost overruns and schedule slips. Generally, it's
the high-profile, major programs which get the most scrutiny
because of the funding and time associated with these
procurements. However, there are other well-documented issues,
many of which could constitute and possibly warrant a dedicated
hearing.
In May of this year, the Government Accountability Office
released its annual Assessment of Major NASA Projects, those
exceeding $250 million in appropriations. This assessment
covered 26 major projects. I'd like to note the Subcommittee
will have a dedicated hearing about the James Webb Space
Telescope next month, but this project's long history of cost
and schedule overruns is relevant to today's discussion as
well.
GAO reported an overall deterioration in the major program
portfolio, primarily due to the fact that 9 out of 17 projects
in development are experiencing cost and schedule performance
growth as a result of risky program management decisions,
significant technical challenges, and issues beyond the control
of the projects.
Last year, GAO assessed that NASA projects were
``continuing a generally positive trend of limiting cost and
schedule growth, maturing technologies, and stabilizing
designs.'' However, GAO also noted that many of the more
expensive projects were ``approaching the phase of their life--
their lifecycles when cost and schedule growth is most
likely.''
The Subcommittee will also investigate specific NASA cost-
estimating methodologies such as the Joint Cost and Schedule
Confidence Level, the JCL process, and NASA management
techniques related to project schedule determination and the
use of headquarters reserve funding. We are particularly
interested in the NASA Inspector General's recommendations on
improvements with NASA's cost estimating methodologies,
especially if there is a need to continue using the JCL process
or adopt another cost-estimating technique.
Furthermore, the Subcommittee will investigate these and
other questions: What acquisition mechanisms--cost plus, fixed
price, award fee, Space Act Agreements, et cetera--are most
appropriate for various types of procurements?
Next, how do these acquisition tools incentivize the
provider to perform safely and efficiently? What are the pros
and cons?
And then, are existing appropriation funding authorities
sufficient for Congressional oversight of major NASA projects?
And lastly, do current agency approaches hold both the
agency and provider accountable for overall performance?
And this is a very timely hearing today. In their report
last month, GAO noted that NASA is planning to invest about $61
billion over the lifecycle of its current portfolio of 26 major
programs, and that doesn't even account for thousands of other
procurements and a significant portion of NASA's spending
authority. Whether large or small, all of NASA's business
decisions matter. Decisions made now have long-lasting
implications on NASA's mission success and leadership.
I want to thank the witnesses for being here. I'm sorry I
was a little bit late, didn't get a chance to shake each of
your hands, but we're looking forward to your testimony on the
challenges that NASA is facing in controlling program cost and
schedule.
[The prepared statement of Chairman Babin follows:]
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Chairman Babin. So now, I'd like to recognize the Ranking
Member of the Subcommittee from California, Mr. Bera.
Mr. Bera. Thank you, Mr. Chairman. Thank you for having
this timely hearing, and welcome to the witnesses. I do look
forward to your testimony.
When you think about NASA, NASA is a unique agency. It's a
source of national pride for us, but it also is a cutting-edge
agency that serves to inspire. Those of us who grew up during
the space race certainly understood that inspiration and it
motivated many of us to go into the sciences.
I want to also acknowledge it's not that often we walk into
a hearing room and we see a line of folks waiting to get in
here, and I think we're joined by NASA's interns and that next
generation that hopefully is going to inspire, discover, and
move us forward. So, thank you to the interns that are here.
You are the future.
In terms of thinking about Congress' role here, we clearly
have a role, a fiscal responsibility and oversight, and those
at NASA don't have an easy job. I mean, you are trying to think
about what that future looks like. You are trying to put those
projects together and I appreciate that check and balance. As
you're doing things that we've never done before, you often
encounter the unexpected. And I think that's why this is an
important hearing.
Resolving cost and scheduling issues are hard, and there
really is no simple fix for these types of situations. That
said I have no doubt that NASA's talented workforce is looking
to find those improvements of how it conducts project
management, oversees its contractors, collaborates with
international partners, provides greater funding certainty, and
applies cost estimation tools and techniques.
But today's discussion of schedule delays and cost
increases and the search for corrective actions cannot take
away from the accomplishments and discoveries made by programs
like Hubble, the International Space Station, and Mars
Curiosity. These accomplishments and discoveries would not have
happened had the nation not made the hard decisions that enable
these projects to carry through in spite of scheduling delays
and cost growth.
And we've been well-rewarded with countless innovations
thanks to the dedicated and inspired work by NASA, its
supporting contractors, and the nation's colleges and
universities. One area for improvement is a better agreement on
the baseline from which cost growth and schedule delay are
determined.
The inconsistent measurement of cost growth across programs
was noted in the National Academies' review of NASA Earth
Science and Space Missions in 2010. For example, some people
characterize the cost growth of the Webb Space Telescope using
an initial baseline project cost of $1 billion to $3.5 billion.
While this was the initial range cost estimated in 1996, that
estimate was not based on a detailed analysis. A detailed
analysis is needed to establish a baseline from which NASA
makes a commitment to Congress that it can design, develop, and
build a project at the cost specified. The initial baseline was
established in the fiscal year of 2009, and according to that
baseline, JWST was estimated to have a lifecycle cost of about
$5 billion. That is a pretty different number than $1 billion.
So, in closing, Mr. Chairman, this topic is timely. NASA's
need to effectively manage its programs will gain even more
importance as the agency seeks to manage its wide-ranging
portfolio in an increasingly constrained fiscal environment
while pursuing ambitious goals such as exploring Europa and
sending humans far away from Earth.
I look forward to a robust discussion at today's hearing,
and with that, I'll yield back.
[The prepared statement of Mr. Bera follows:]
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Chairman Babin. Thank you very much.
And now I'd like to--in fact, before I recognize our next
speaker, I also want to reiterate--thank you for saying this,
Congressman Bera. I met some of you outside in the hall when I
walked up, and I wanted to tell you that we're elated that
we've have got all of these NASA interns in here, and we really
appreciate the good work you're doing and just want to pat you
all on the back. You're our future in the space program. Thank
you for being here.
Now, I'd like to introduce our--the Chairman of the full
Committee, the gentleman from Texas, Chairman Lamar Smith.
Chairman Smith. Thank you, Mr. Chairman.
This Committee has demonstrated time and again that U.S.
leadership in space is a bipartisan priority. Our vote on the
2018 NASA Authorization Act in April was a clear demonstration
of that.
Congress and the Administration support a consistent,
focused space program, and the current NASA budget demonstrates
that resolve. NASA once again received one of the most
favorable authorizations and appropriations of any agency.
Healthy budgets are a good start, but they must be followed
up with solid management and oversight to make certain
taxpayers' funds are spent well. However, excessive costs and
missed deadlines may undermine the very NASA projects Congress
and the American people support.
We recently held hearings discussing four of NASA's highest
profile programs: SLS, Orion, Commercial Crew, and the James
Webb Space Telescope. The Subcommittee will have a hearing next
month about the JWST program breach, and Northrop Grumman's CEO
has agreed to testify.
The GAO's report identified significant cost and deadline
problems with all four of these high-interest programs. SLS and
JWST are identified as having deteriorating cost and schedule
performance due to risky decisions involving technology. GAO
found that the commercial crew contractors continue to have
significant delays in the test flight schedules. And NASA
expects the Orion program to exceed its cost baseline.
GAO assessed other NASA major projects this year as well.
For example, the Wide Field Infrared Survey Telescope remains a
serious concern for Congress. This Committee has requested but
not received the WFIRST lifecycle cost estimate that was
required by the fiscal year 2018 omnibus.
Congress has a responsibility to authorize and appropriate
funding necessary to accomplish the tasks it directs NASA to
carry out. But Congress also has a responsibility to not let
cost overruns detract from other NASA priorities, such as
research and small- and medium-class missions.
It is time for NASA's contractors to deliver. The 2018 NASA
Authorization Act takes important steps to impose a contractor
responsibility watchlist. This watchlist would penalize poor
performing contractors by restricting them from competing for
further NASA work.
Beyond contractor watchlists, NASA should continue to
explore additional options to reduce the costs of these large
programs, such as leveraging program surpluses, early-stage
cost caps, firm fixed-price contracts, and public-private
partnerships that benefit taxpayers. Anything short of that
will undermine Congressional confidence in the contractors'
ability to deliver on their promises at a reasonable cost.
If space exploration is going to continue to earn the
public's trust, then contractors will have to deliver on time
and on budget. If they cannot, then they should face sanctions.
Mr. Chairman, again, I look forward to our witnesses'
testimony today and yield back the balance of my time.
[The prepared statement of Chairman Smith follows:]
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Chairman Babin. Thank you very much.
Now, I'd like to introduce the gentlewoman from Texas, the
Ranking Member of the full Committee, Ms. Johnson.
Ms. Johnson. Thank you very much, Mr. Chairman, and thank
you for holding this hearing and thanks to our witnesses for
being here.
This morning, we hope we're going to get a status update on
NASA's management and its programs, particularly cost and
schedule status on its large missions. To that end, I hope the
hearing will provide answers to some of our key questions. Is
NASA's ability to manage cost and schedule on its programs
improving or is it getting worse, as the Government
Accountability Office seems to indicate in its recent report on
NASA's major projects?
If it is getting worse, what should be done, particularly
by this Committee? Cost and schedule can be expected to be
difficult on projects that push the state-of-the-art in science
and engineering. Challenging missions and transformational
science are what we expect of space programs worthy of this
great nation.
That said, Mr. Chairman, we can do better. In particular,
we need to improve our ability to identify early on when we can
still make design decisions whether a project runs the risk of
exceeding budget constraints and, if so, what options we have
at our disposal to make sure the program meets those budget
constraints.
The Wide Field Infrared Survey Telescope is a good example.
After stakeholders, including the National Academies, expressed
concerns that the WFIRST could run into potential cost and
schedule growth, NASA established expert groups to rigorously
review the cost, engineering, and science objectives for the
mission. I commend NASA for taking this action. These steps are
being taken before a final WFIRST mission design is established
and while there is still time to reconsider the scope and
approach of the mission to preclude the possibility of
exceeding costs, schedule expectations as it starts its
development.
Mr. Chairman, I look forward to discussing learning
opportunities such as this one in determining whether future
NASA missions would benefit from incorporating similar
processes to minimize the possibility of future schedule delay
and/or cost increases.
One thing I learned early on while serving on this
Committee is that NASA is a unique engine of innovation, a
force for pushing new advances in space technology and
operations. That is why I'm anxious to hear from our witnesses
on whether the costs and schedule models that are based on the
past, traditional approaches to national project development
are being updated to reflect the changes in today's
manufacturing, operations, and technology environment. Is R&D
on cost and schedule models needed? Are there other tools that
could help NASA improve the management of cost and schedule in
its acquisition of space systems?
We do have a lot to discuss this morning, and I look
forward to hearing from our witnesses. Thank you, and I yield
back.
[The prepared statement of Ms. Johnson follows:]
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
Chairman Babin. Thank you very much.
Now, I'd like to introduce our witnesses. Our first witness
today is Ms. Cristina Chaplain, Director of Contracting and
National Security Acquisitions at the U.S. Government
Accountability Office. Among other topics, Ms. Chaplain has led
reviews on the ISS, the SLS, and Orion crew capsule, as well as
commercial cargo and crew projects at NASA.
Ms. Chaplain received her bachelor's degree in
international relations from Boston University and a master's
degree in journalism from Columbia University. We welcome you.
Our second witness today is Mr. Stephen Jurczyk, serving as
the Associate Administrator of NASA, the agency's highest-
ranking career civil service position. Prior to this
appointment, Mr. Jurczyk served as Associate Administrator of
the Space Technology Mission Directorate where he formulated
and executed the agency's space technology programs.
Mr. Jurczyk is a graduate of the University of Virginia
where he received a Bachelor of Science and a Master of Science
in electrical engineering. Thank you for being here.
Our third witness today is Hon. Paul Martin, Inspector
General of NASA. Prior to this appointment, Mr. Martin served
as the Deputy Inspector General of the U.S. Department of
Justice in the Office of Inspector General. Mr. Martin holds a
Bachelor of Arts in journalism from Pennsylvania State
University and a Juris Doctor from Georgetown University Law
Center. Thank you for being here.
Our final witness today is Mr. Daniel Dumbacher, the
Executive Director of the American Institute of Aeronautics and
Astronautics, or AIAA. Mr. Dumbacher--is it Bacher or Bacher?
Mr. Dumbacher. Bacher.
Chairman Babin. Bacher, I thought so. I served three years
in Germany, so I thought so. Mr. Dumbacher has previously
served as the Deputy Associate Administrator of the Exploration
Systems Development Division of NASA's Human Exploration and
Operations Mission Directorate.
Mr. Dumbacher earned his bachelor's degree in mechanical
engineering from Purdue University and a master's degree in
business administration from the University of Alabama in
Huntsville. He has also completed the Senior Managers in
Government program at Harvard University.
So I'd like to recognize Ms. Chaplain for five minutes to
present her testimony.
TESTIMONY OF MS. CRISTINA CHAPLAIN, DIRECTOR,
GAO: CONTRACTING AND
NATIONAL SECURITY ACQUISITIONS
Ms. Chaplain. Chairman Babin and Ranking Member Bera,
Chairman Smith and Ranking Member Johnson, thank you for
inviting me today to discuss the cost and schedule performance
of NASA's largest projects.
Since we began our assessments of major projects ten years
ago, we have seen NASA make progress in reducing acquisition
risk, but our most recent review found that performance has
worsened after several years of following a general positive
trend.
[Slide.]
Ms. Chaplain. Specifically, as shown in this graph, the
average launch delay, which is the yellow line with dots,
increased from 7 months in our 2017 report to 12 months in this
year's report. This was the first year we could not determine
the extent of cost growth because NASA does not have a current
estimate for the Orion program. Orion accounts for 22 percent
of about $30 billion of development costs for major projects.
Even without including Orion, however, the overall
development cost growth increased to 18.8 percent, up from 15.6
percent in 2017. We expect this number to increase further once
Orion is factored in and probably even more as large projects,
including James Webb, Space Launch System, and Exploration
Ground Systems are in their riskiest phases of development.
In regard to this graph, I'd also like to point out that
when we started our assessments in 2009, cost and schedule
growth was more problematic than depicted. Many baselines had
been set just a couple years prior in response to a statutory
requirement aimed at enabling more consistent reporting from
NASA. So, as you can see, it's been a struggle for Congress to
hold them accountable for years. Also in 2012, you can see the
impact that James Webb had on the overall cost growth when its
estimate increased from 4.9 billion to $8.8 billion.
[Slide.]
Ms. Chaplain. This next graph depicts some of the reasons
why projects experience cost and schedule growth. They're not
so different than what we've seen in the past at NASA and
across government space programs. Cost and schedule growth is
sometimes due to issues beyond a project's control--the light
blue circles--which might include a delivery--a late delivery
and a delay of the launch vehicle.
In other times the dark blue circles, it was due to risky
management decisions. For instance, human spaceflight programs
have been operating with very low cost and schedule reserves,
which has limited their ability to address unforeseen technical
challenges. In other cases, projects encounter technical
problems that can sometimes be avoided and sometimes not. The
James Webb program is reporting delays, for example, due to
workmanship errors that delayed the delivery of the spacecraft
propulsion system and also because of unanticipated
complexities involved with unfurling the sunshield, which is
unique to the telescope. We're looking at whether more could
have been done to avoid the workmanship issues.
Since the mid-2000s, NASA has made strides in developing
tools and approaches to reduce costs and schedule growth.
[Slide.]
Ms. Chaplain. As shown in this graph, for example, projects
are increasingly building more knowledge about critical
technologies early so that they do not discover problems when
they're more expensive and time-consuming to fix. Similarly,
they're building more knowledge about design before proceeding
into integration. NASA has also improved cost and schedule
estimating processes and its oversight processes.
While we recognize NASA's progress, we believe more can be
done to put programs on a sounder footing. For example, as
mentioned earlier, the human spaceflight projects should not be
operating with low cost and schedule reserves. Projects should
also regularly update cost and schedule estimates, but they are
more often reluctant to do so. For James Webb, an updated
estimate may have forecasted the current schedule delays if it
were done a few years ago.
We also still find that some projects do not manage
contractors well and react only after problems become
overwhelming. This year, we saw that workmanship errors on even
the smallest of components can sometimes have dramatic impacts.
Lastly, NASA should take steps needed to ensure cost growth
from a large project does not overwhelm a portfolio. NASA did
this recently for its astrophysics portfolio when it undertook
an independent review of the WFIRST telescope before the more
costly phases of the acquisition process began. This type of
assessment should continue.
In conclusion, we recognize NASA projects are complex, they
face inherent technical challenges. Some cost and schedule
growth is inevitable when you push the state of technology, but
more can be done to limit management risks that often
exasperates problems.
Chairman Babin, Ranking Member Bera, this concludes my
statement, and I'm happy to answer any questions you have.
[The prepared statement of Ms. Chaplain follows:]
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
Chairman Babin. Thank you, ma'am.
I now recognize Mr. Jurczyk for five minutes to present his
testimony.
TESTIMONY OF MR. STEVE JURCZYK,
ASSOCIATE ADMINISTRATOR, NASA
Mr. Jurczyk. Mr. Chairman and Members of the Committee, I
am pleased to have the opportunity to discuss NASA's program
management accomplishments and challenges.
NASA is focused on its mission of science and exploration.
In support of this mission, the agency has developed a rigorous
process for program formulation, approval, implementation, and
evaluation. NASA's challenge is to develop and improve our
program project management capabilities to ensure both
efficiency and accountability. We must execute and deliver
missions on cost and on schedule. We have to execute in an
environment that includes some significant risk, and we are
focused on identifying and characterizing risks as quickly as
possible. We must take corrective actions promptly, whether
mitigating, accepting, evaluating, or monitoring an identified
risk.
NASA implements a rigorous process for project formulation,
development, and execution. Projects proceed through a series
of key decision gates. At Key Decision Point C, which we refer
to as KDP-C, the agency commits to deliver a project within an
established baseline cost and schedule. This agency baseline
commitment is the baseline against we which we evaluate
performance.
Beginning in 2009, NASA adopted a joint confidence level--
or JCL--approach to producing estimates, and this approach has
resulted in improved performance. The JCL employs probabilistic
risk assessment to establish a confidence level for an
estimate. Typical NASA--typically, NASA establishes baselines
for major projects around a 70 percent confidence level. Since
the agency established its JCL policy, programmatic performance
has significantly improved as NASA has launched more projects
at or near their original cost and schedule baselines.
NASA is committed to applying a robust set of available
authorities to accomplish our mission efficiently and
effectively. NASA's strategic acquisition process utilizes
multiple authorities to meet agency objectives, including,
though not limited to, federal acquisition regulation or FAR-
based contracts, grants, cooperative agreements, international
agreements, and Space Act Agreements. NASA has expanded its use
of fixed-price contracts where appropriate with the percentage
of funds NASA spends on firm fixed-price contracts increasing
from 26 percent in 2013 to 35 percent in 2016.
The JCL approach has certainly improved our performance,
and we look forward to building on this success to address our
ongoing challenges with major projects. NASA is working to
strengthen program planning and control through a series of
initiatives, including the application of industry-standard
earned value management processes. NASA began the process of
applying an in-house EVM capability in 2013 and has broadened
its use in a stepwise fashion over time. NASA is leading an
effort through the scheduling initiative to strengthen schedule
management by building a community to identify and reinforce
schedule management best practices.
Our decision to conduct independent reviews of both WFIRST
and JWST missions, along with our continued support for regular
GAO reviews and audits, illustrate our commitment to
transparency and our determination to identify risks as early
as possible and immediately take action to mitigate them.
Finally, Mr. Chairman, NASA will continue to accept the big
challenges that the Committee and the nation place before us.
Our missions will continue to incorporate cutting-edge
technologies and to pursue the challenging goals that can only
be accomplished in the hostile environment of space. NASA
missions do things that have never been done before. The Parker
Solar Probe will dive into the sun's corona. The James Webb
Space Telescope will unfold itself almost a million miles from
Earth and operate at minus 380 degrees Fahrenheit. The Space
Launch System or SLS will enable humans to travel deeper into
space than ever before. These missions will employ technologies
that must be developed and tested on Earth but can only be
demonstrated in space.
All this is to say that NASA must accept the risk, but we
are committed to managing that risk and executing within our
cost and schedule commitments.
Thank you for the invitation to testify before you today,
and I look forward to answering any questions you may have.
[The prepared statement of Mr. Jurczyk follows:]
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
Chairman Babin. Thank you, Mr. Jurczyk.
I would like to now recognize Mr. Martin for five minutes
to present his testimony.
TESTIMONY OF MR. PAUL MARTIN,
INSPECTOR GENERAL, NASA
Mr. Martin. Thank you, sir.
Chairman Babin. Yes, sir.
Mr. Martin. Members of the Subcommittee, over its 60-year
history, NASA has been responsible for numerous scientific
discoveries and technological innovations. However, many of
NASA's largest projects cost significantly more to complete and
take much longer to launch than originally planned.
Our office has examined NASA's successes and failures in
project management by examining the long-standing challenges
the agency has faced in meeting cost, schedule, and performance
objectives, as well as the tools it has developed to address
these shortcomings. We identified four factors that present the
greatest challenges to successful project outcomes: one, NASA's
culture of optimism; two, underestimating technical complexity;
three, funding instability; and four, development of new
project managers. My remarks this morning address the first two
of these challenges, optimism.
Optimism exemplified by the agency's greatest achievement,
landing humans on the Moon and safely returning them to Earth,
NASA's ability to overcome obstacles has become part of its
can-do culture. However, our work has shown that this attitude
contributes to development of unrealistic plans and performance
baselines, particularly with respect to its largest projects.
And technological success, often at a significantly greater
cost than originally estimated, tends to reaffirm a mindset
that project cost and adherence to schedule are secondary
concerns. In fact, several people offered a name for this
phenomenon, calling it the ``Hubble psychology'' or an
expectation that projects that fail to meet initial cost and
schedule goals will receive additional funding and that
subsequent scientific success will overshadow budget and
schedule problems.
The Hubble Space Telescope was two years late and about $1
billion more than initial estimates, but most people don't
remember that. Instead, they rightfully remember its stupendous
images of the universe. While a few projects in NASA's recent
past have been canceled because of poor cost and schedule
performance, a too-big-to-fail mentality pervades agency
thinking when it comes to NASA's larger and most important
missions. While understandable given the investment of agency
resources, cost overruns in these projects can result in delays
to other missions as funding is reprioritized.
Technical complexity: The technical complexity inherent in
NASA projects remains a major challenge to achieving cost and
schedule goals, with project managers attempting to predict the
amount of time and the amount of money needed to develop one-
of-a-kind and first-of-their-kind technologies. We found that
NASA historically has underestimated the level of effort needed
to develop, mature, and integrate such technologies.
To help project managers avoid cost and schedule overruns,
NASA has implemented a number of initiatives. I highlight two
this morning. JCL: Required since 2009 for all NASA projects
with lifecycle costs exceeding $250 million, a JCL analysis
calculates the likelihood a project will achieve its objectives
within budget and on time. The process uses software models
that combine cost, schedule, risk, and uncertainty to evaluate
how expected threats and unexpected events may affect a
project's cost and schedule. Our examination of NASA's use of
JCL found mixed success with the tool unevenly applied across
agency projects.
Contracting: NASA makes use of multiple procurement
vehicles for its projects, including fixed-price and cost-
reimbursement contracts, as well as funded Space Act Agreements
used to spur development of commercial cargo and crew
capabilities. As NASA looks increasingly to the private sector
to leverage its resources, it must ensure that the contracting
mechanisms it chooses are best suited to maximize the agency's
significant investments.
In sum, to meet cost and schedule goals, agency leaders
must temper NASA's historic culture of optimism by demanding
more realistic cost and schedule estimates, well-defined and
stable requirements, and mature technologies early in project
development. In addition, Congress and NASA managers must
ensure that funding is adequate and properly phased.
Finally, the agency must be willing to take remedial action
up to and including termination when these critical project
elements are not present. In our judgment, meeting these
project-related challenges can only be accomplished through
leadership that articulates a clear, unified, and sustaining
vision for NASA and provides the necessary resources to execute
that vision. Thank you, sir.
[The prepared statement of Mr. Martin follows:]
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
Chairman Babin. Thank you very much, Mr. Martin.
Now, I'd like to recognize Mr. Dumbacher for five minutes
to present his testimony.
TESTIMONY OF MR. DANIEL L. DUMBACHER,
EXECUTIVE DIRECTOR,
AMERICAN INSTITUTE OF AERONAUTICS
AND ASTRONAUTICS (AIAA)
Mr. Dumbacher. Chairman Babin, Ranking Member Bera, and
distinguished Members of the Committee and Subcommittee----
Chairman Babin. You may want to push your button there. I'm
sorry. Yes.
Mr. Dumbacher. Chairman Babin, Ranking Member Bera, and
distinguished Members of the Subcommittee, thank you for this
opportunity to address you today. Your support for the nation's
space program is to be commended.
I sit before you as a former NASA Program Manager, former
educator, and as the current Executive Director of the world's
largest aerospace professional society.
Let me first say that the work NASA employees and its
industry partners do is purposely challenging. The NASA
industry teams should be commended for their accomplishments
under such tight constraints. Programs are complex, and a great
deal of planning and commitment is necessary to execute a
successful mission.
Every program has its unique challenges. The NASA industry
team works hard to address these issues, develop solutions, and
incrementally make progress towards the respective missions. No
matter how much planning takes place or how well-thought-out
the plan, it's difficult to estimate the cost and schedules of
these complex one-of-a-kind projects.
All federal government departments and agencies are
operating in a time of heightened fiscal responsibility and
accountability. Accordingly, NASA has updated policies and
guidance to focus on formulation and implementation with robust
cost-estimating; well-defined baselines, designs, and risk
postures at key decision points; and formal requirements and
guidance.
Especially during the implementation phases of its
projects, NASA has processes to ensure that rigorous cost
assessment is performed. Program progress is tracked through
the periodic performance review process. Since NASA instituted
its joint confidence level policy nearly a decade ago, NASA's
cost and schedule performance has improved.
From my perspective, the issues experienced in the NASA
projects can be assessed in two categories: one, the need for
stable, predictable, and consistent funding; and workforce
development. Simply stated, project management has three basic
knobs: content, schedule, and cost. A change in any one of
these three variables directly affects the other two.
Cost and schedule issues do arise when there are
unanticipated changes to a program or when development
challenges arise, particularly during first-time production and
when technical capability is being pushed. Disruptions to the
budget process and funding stream, along with major policy and
priority shifts, affect schedules and contracts and ultimately
lead to additional cost. It is also quite difficult for NASA to
plan and implement programs without sufficient resources or
reserves.
A key issue is projects developed under a flatline budget.
A flatline budget requires project managers to realign the work
as they go to stay under the budget cap, resulting in hard
priority decisions and inefficiencies that explicitly break the
program linkages across schedule and budget. These
circumstances can and do add to program cost to move schedules
to the right. We learned this lesson with the International
Space Station and yet now we're repeating it with SLS and
Orion.
The current budgeting process, including the regular use of
continuing resolutions, late-year appropriations, and threats
of government shutdowns result in endless multiple planning
scenarios. As stated in October 2015 testimony before this
Subcommittee, the need to constantly have backup plans for
various potential appropriations outcomes, different budget
planning levels, along with flexible workforce blueprints
invites confusion and miscommunication.
A related issue is the inability of NASA to include
appropriate budget and schedule margin in its program planning
due to externally imposed constraints. Planned margin is
difficult to include because it becomes the first target for
budget reduction in the budget and appropriations process.
A separate but related issue that must be addressed is the
workforce challenge impacting the aerospace community as a
whole. There remains a nationwide shortage of workers for jobs
requiring science, technology, engineering, arts, and
mathematics. According to Aviation Week's 2017 workforce study,
nearly 30 percent of the nation's aerospace and defense
workforce are over the age of 55, and 22 percent are younger
than 35.
More concerning is the lack of development program
experience. The vast majority of the NASA human spaceflight
workforce has been hired and trained after space shuttle
development. Space station development has provided on-orbit
expertise. However, launch system development experience is
minimal. NASA expertise that developed the space shuttle has
mostly retired or passed away.
For the United States to continue its long-held space
exploration leadership, significant investments must be made in
addressing the workforce development via hands-on real-world
hardware programs and research. Key technical challenges for
the future of space exploration such as new propulsion, on-
orbit assembly, and human survival in microgravity should be
addressed. Such investments would meet key research and
engineering needs, while providing valuable experience. A well-
developed leadership bench is also necessary for a program's
mission success. This ensures the appropriate expertise to
assess and balance risk and priorities.
In conclusion, I thank this Committee for the opportunity
to talk today and look forward to your questions.
[The prepared statement of Mr. Dumbacher follows:]
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
Chairman Babin. Thank you, Mr. Dumbacher. We appreciate it.
Now, I would like to recognize myself for five minutes for
questioning. And I have a bunch of questions, and I'm sure
everybody else does, too, so if you could just get right to the
point, answer these things, we want to cover as much of this
part of ground as we possibly can.
NASA has a storied history with overrunning costs and
schedules for space systems development. Some of these programs
have even suffered cancelation as a result, and this has simply
got to stop. We need performance, not excuses from the agency,
as well as providers. And with that in mind, of NASA's options,
what acquisition mechanisms such as cost-plus, fixed-price, or
Space Act Agreements are most useful in promoting performance
and holding the provider as well as the agency management
accountable for meeting the acquisition requirements? And I'd
ask you first, Mr. Dumbacher.
Mr. Dumbacher. Congressman, I think the appropriate
acquisition tool depends on the objectives of the program and
the scientific engineering issues and risks associated with
that.
Typically, we have a lot of experience with cost-plus
contracts in this country. NASA uses that a lot for its major
programs. There is the discussion of public-private
partnerships, which can also be valuable and have been tried in
the past, some successful, some not. When we consider all of
this, we need to consider the objectives that are for the
program, what are the incentives and the motives that are
necessary for success both in terms of how it would apply in a
public-private partnership, as well as a cost-plus arena? And
we need to sort through those and make valid, conscious,
objective decisions.
Chairman Babin. Thank you. And now that same question, Ms.
Chaplain, if you would answer that. I don't need to repeat it,
right?
Ms. Chaplain. Right.
Chairman Babin. Okay.
Chairman Babin. So with fixed-price contracts, the
contractor bears the most risk for meeting cost and schedule
goals, so that's your main aim. That's a contract, but it's not
really appropriate when you're facing a lot of unknowns at the
beginning. If you're really stretching technology, don't know
how long it's going to take, how much it's going to cost, in
that case the government does need to bear the risk of the
contract, and that's where cost-plus comes in.
Chairman Babin. Okay. Thank you. And then we're talking
about cost-plus, so I'm just going to--the second part of my
question to you two, do cost-plus contracts provide any
incentive for the provider to complete the project on time and
on schedule?
Ms. Chaplain. There are typically incentives built into the
contract, and they come through the award fees. So some may be
tied to performance and quality and things like that, but
others could definitely be tied to cost and schedule.
Chairman Babin. Okay. All right. Thank you. And, Mr.
Dumbacher?
Mr. Dumbacher. Just to add a little bit to that, when we
have done award fee, cost-plus award fee, and incentive fee in
the past, we do and can make schedule performance and cost
performance part of the evaluation criteria, and that is
typically included.
Chairman Babin. Okay. Thank you. And then to Mr. Martin and
Ms. Chaplain as well, acquisition encompasses a great deal,
including strategic planning, procurement processes, and the
development of clear requirements. For many years, the DOD has
employed a robust training and certification program for
defense acquisition professionals. What institutional
improvements such as training, certification, and career
progression are necessary or perhaps missing from NASA's
acquisition processes?
Ms. Chaplain. I know NASA has invested pretty heavily in
training cost estimators and project management. They have
conferences every year, for example. But I still think maybe
more could be done in that area in certain techniques and
especially more program management issues related to managing
contracts.
Chairman Babin. Okay. And then Mr. Martin?
Mr. Martin. Attracting and retaining the project managers
is a real challenge for the agency. As Mr. Dumbacher suggested,
within NASA, 50 percent of the workforce is over 50 years old,
and with a diminishing number of small projects for these
project managers to really get the experience and cut their
teeth on, it's a real concern.
Chairman Babin. Okay. And then do you think NASA can gain
from DOD's experiences?
Mr. Martin. I'm not as familiar with DOD's experiences.
Chairman Babin. Okay. Ms. Chaplain?
Ms. Chaplain. I think that Defense Acquisition University
is a very good model for training programs and all kinds of
issues. It's something NASA could look toward.
Chairman Babin. Okay. Thank you.
Mr. Jurczyk, NASA recently took steps to control the costs
of the Europa Clipper and WFIRST missions while in formulation.
Have these steps proven helpful, and can similar measures be
implemented on other major projects to control the cost?
Mr. Jurczyk. Yes. On WFIRST we did an independent--had an
independent review board come in and look at the project early
in phase A, in formulation, and they confirmed that the project
scope had grown and they were not going to be able to execute
the mission within the $3.2 billion budget that we had for
their--for them for the management agreement. They made some
recommendations. The project took those recommendations and
adjusted the scope and re-planned the cost and schedule
estimates and they came in and presented their baseline to the
agency program management council, which I chair. And we have
confidence, based on their estimate given the re-plan, that
they have a solid estimate going into phase B. I think that--
and similarly for Europa Clipper. So I think that is a way to
try to minimize cost and schedule risk early in the program.
Chairman Babin. Okay. I'm out of time. I had several more
questions, but thank you very much.
I'd like to recognize the gentleman from California, the
Ranking Member, Mr. Bera.
Mr. Bera. Thank you, Mr. Chairman. Each of you in your
opening statements obviously touch on the complexity of
budgeting and scheduling when you're trying to do something
that you may never have done before. And I have to imagine when
we started on the Apollo missions, lots of cost overruns, lots
of scheduling delays, but as you got further down the road,
understood what we had to do, that started to reduce and there
was more predictability.
As we think about future missions, let's put it in the
context of something we talk a lot about, Mars by 2033. We
don't know how we're going to do that. We don't know the
technology and the science and everything else. As we go into
deeper space, we are encountering more complicated projects. As
we look at the balance of the commercial sector, the
entrepreneurial sector, more reliance on external entities.
When we did Apollo, NASA was the launch vehicle, the landing
vehicle, the science mission, maybe a little bit more control
as you think about working with outside contractors and new
startup companies that may be--a little bit more
unpredictability, I think that adds another variable. As the
international community becomes much more engaged, as you see
countries like India, Japan, the European Space Agency start to
do some of the science, another complicated variable.
So, as opposed to budgeting and scheduling getting easier,
my sense is budgeting and scheduling is going to get more
difficult. Is that a reasonable--reasonably accurate thought? I
guess, Ms. Chaplain.
Ms. Chaplain. Well, I would like to note in the Apollo era,
a lot of things had never been done before, so they were very
difficult to estimate. I think now we have the benefit of time
and history that there are a lot of things we can estimate even
if we haven't done that particular mission.
And I also know that in the past decade the three space
agencies, DOD, NRO, and NASA have been working very closely
together to kind of gain that historical perspective in costs
and build databases so there is more knowledge there that gives
you an advantage. But yes, those other complexities do make it
hard.
Mr. Bera. Right. And as we think about that, learning from
what we've done in the past, trying to create more predictable
models of budgeting and scheduling, I think to Chairman Babin's
question, you know, I'll put it in the context of my profession
as a doctor. We'll often--and--as we're caring for populations
of patients, we'll have a shared risk pool that says, okay for
a certain fee, we're going to take care of this population of
patients. If we do really well, we improve health, et cetera,
there's a reward on that end. If, on the other hand, we do a
bad job taking care of these patients, we share some of that
risk.
And I don't know if in contracting--I think you touched on
the shared risk award fees, et cetera. Have you noticed in that
type of contracting that you actually get better predictability
when not doing something that we know how to do and is pretty
predictable but something where there is some risk involved?
And Ms. Chaplain, if you want to answer that or, Mr. Martin, if
you want to take that.
Mr. Martin. Let me just toss in that over the last ten
years, NASA has moved to a new procurement mechanism, the
funded Space Act Agreements, particularly to spur development
of transportation capabilities for cargo and crew services to
the International Space Station. Now, NASA contributes
significant--billions of dollars--to the funded Space Act
Agreements, but the commercial companies also have a
significant financial stake in the game. So having them have
their skin in the game as well to develop these private
capabilities of which NASA will be procuring as a service, I
think is interesting and has been relatively successful.
Has it increased cost schedule and timing? Not
particularly.
Mr. Bera. Mr. Jurczyk?
Mr. Jurczyk. Yes, as I said before, we choose kind of--
either a FAR-based, you know, contract, either cost
reimbursement or fixed price or a public-private partnership
where it makes sense. Particularly public-private partnerships
where there's shared strategic common interests between
ourselves and an industry partner or partners, that makes a lot
of sense, and therefore, there--we also share the risk there in
that partnership.
We did do a reimbursable Space Act Agreement, a funded
Space Act Agreement for cargo. We've kind of moved away from
that approach because of our ability to have insight and
manage. And our latest public-private partnerships have
actually been through fixed-price contracts with cost-sharing
where we use the FAR rules to manage the relationship and allow
the contractor to contribute resources and share the risk.
Mr. Bera. All right I'm out of time, so----
Chairman Babin. Thank you very much.
And now, I'd like to recognize the Chairman of the full
committee, Mr. Smith from Texas.
Chairman Smith. Thank you, Mr. Chairman.
Ms. Chaplain and Mr. Martin, a lot of NASA contractors seem
to not be able to stay on schedule, they fall behind, and they
end up with cost overruns and fail to perform as we expect them
to do. In the 2018 NASA Authorization Act, we have a watchlist
for contractors who don't perform well.
And let me--before I get to my specific question, let me
just say that I think the American people are rightfully
sometimes frustrated by the Federal Government when things go
wrong, when projects end up not being performed as they should,
when there are cost overruns, when the deadlines are missed.
And somehow no one is held accountable; no one is responsible.
It just happened. And I think that is frustrating to the
American people when they see projects that cost millions if
not billions of dollars more than expected.
So I'd like to ask you all who you think would be good
candidates for that watchlist. The watchlist is just that,
these are contractors who need to be watched more closely, who
need to be reminded of their contractual obligations and
perhaps sanctioned if they don't improve their performance.
But, given your investigations, who are some of the contractors
that we might consider putting on such a watchlist? And, Ms.
Chaplain, start with you if we could.
Ms. Chaplain. It's a difficult question because in some
cases there's a shared responsibility between NASA and the
contractor, so it's hard to parse out who's really responsible
for that overrun. Even when it comes to like a workmanship
issue, there could be some shared responsibility there.
If you look at the provision you were talking about, there
are a couple projects in our list where performance has been
bad consistently over time, and NASA has actually canceled or
proposed canceling a project or is looking at whether to do
that because--
Chairman Smith. Okay.
Ms. Chaplain. --contractor performance. In those cases--
Chairman Smith. And who were those contractors?
Ms. Chaplain. One is--for the SGSS project, that would be
General Dynamics, so that project is being looked at.
Performance has been a long-standing issue on that.
Chairman Smith. Okay.
Ms. Chaplain. The other one was the RBI Instrument, which
is a weather satellite sensor. That one was proposed for
termination. That was Harris Corporation and formerly Exelis.
That--those are the more extreme cases--
Chairman Smith. Okay.
Ms. Chaplain. --that could possibly--but it's ultimately
like NASA's decision, and they have to--
Chairman Smith. I understand.
Ms. Chaplain. --really investigate the situation.
Chairman Smith. Okay. Thank you. Mr. Martin, in your
testimony, you made a couple of really good suggestions I
thought to try to avoid the to-big-to-fail syndrome. What are
some other ways we can hold contractors accountable? We have
the watchlist. What are some other things that we can do to
keep projects on time and on budget?
Mr. Martin. I think one of them is what you are doing here
today is an oversight hearing and the proposed hearing several
weeks from now to focus on the issues specific to JWST.
Chairman Smith. Right.
Mr. Martin. I think aggressive oversight by GAO and the
IG's Office is important, and I think just a general sense that
folks need to be held accountable for--you know, there's human
failure, we all fail, but there are avoidable human mistakes on
some of these projects. For instance, the improper use of a
solvent on the JWST by Northrop Grumman, inadequate welding on
the SLS core stage by Boeing, as the prime contractor. So we
have individual avoidable mistakes.
We have issues with our international partnerships, which
are key to the future of NASA. But when the European Service
Module is 14 months behind schedule, that impacts Orion.
Chairman Smith. Right. Final question for you and also I
think for Ms. Chaplain, and it is this, that it is very
unlikely that NASA's budget is going to see a significant
increase, say 25 percent, anytime soon. It's just not the
nature of our spending, and various constraints are going to
prohibit I think any agency from getting a significant
increase. We're fortunate, I believe, to have--NASA had sort of
a flatline budget. So many agencies--other agencies have been
cut. Yet there are a lot of people and pundits who expect us to
keep the International Space Station as-is, go back to the
moon, and then on to Mars, and seem to be able to think we're
going to do everything all the time.
I think that in my opinion is not being willing to make
some difficult decisions. Realistically, I don't think it's
possible. I think it's very naive to think we can do everything
all the time. Do you agree with that assessment or is--am I
missing--is there some magic solution that will enable us to do
everything all the time? Or are we going to have to take a hard
look at some of these big missions like--either ones that we
already have like the space station or others to come like the
Moon and Mars?
Mr. Martin. No, you're not missing anything. I think it's
all about choices. There's a finite amount of resources, and
you're right, NASA has been very fortunate in the budgets it's
received over the years. But that's why cost and schedule
estimation is so important, to come up with realistic cost and
schedule so you can put it before the decision-makers at NASA
and in Congress.
Had NASA been able to say that the James Webb Space
Telescope was going to cost $8 billion ten years ago when it
was proposed, then it's a decision. You do James Webb--and I'm
not suggesting it should or shouldn't have been done. It's
going to do amazing things when it's up there--but you make a
decision based on that. But if you say yes to James Webb,
you're saying no to a lot of other things.
Chairman Smith. Right. And that's what we have to
appreciate and recognize and understand.
My time is up but, Ms. Chaplain, can you give us a really
brief response to that as well?
Ms. Chaplain. I think NASA is at risk of having too many
programs to pay for at one time. Even if you look at what we've
been looking at over the years, we started out with 15 to 16
projects. That helped them reduce cost overall.
Chairman Smith. Okay.
Ms. Chaplain. Now, we're looking at 26.
Chairman Smith. Okay. Thank you. Thank you, Mr. Chairman.
Chairman Babin. Great questions. Thank you.
I now recognize the gentlelady from Texas, Ms. Johnson.
Ms. Johnson. Thank you very much.
Ms. Chaplain, in your 2017 assessment of NASA's major
projects, you indicated that in October 2015, NASA decided to
decentralize its independent assessment function and deploy the
staff to the agency centers in part to better use its workforce
to meet program needs in areas such as program management and
cost estimating.
GAO had previously reported on the potential risk that this
change could pose for project oversight but stated that it was
too early in the transition to assess its effect on areas such
as independence, the robustness of the reviews, and
information-sharing. So now one year later, are you able to
tell us whether that decentralization was successful?
Ms. Chaplain. We haven't seen a real visible impact either
way yet. We're still very concerned about that move. I think
it's beneficial to the agency to have centralized expertise in
those areas. They really can leverage each other a lot.
Ms. Johnson. Mr. Jurczyk, do you have any comment?
Mr. Jurczyk. Yes, I think we've moved to a model where
we're putting the responsibility and accountability of the
mission directorate to manage the programs to do that
independent assessment, and so far, they've stepped up to the
job, and I think they're doing an effective job in implementing
our spaceflight project management processes, including
reviews.
We do still have a cadre of experts in the Office of the
Chief Financial Officer that have schedule and cost assessment
expertise that the review boards can draw on. And we've also
given stewardship of project planning and control to the Office
of the Chief Financial Officer, and that's been very
beneficial, and not only this cadre of people for schedule and
cost estimating but improving our skills and processes and
capabilities in cost and schedule estimating and management.
Ms. Johnson. Okay. Let me ask you this. What are the most
important things that NASA can do to minimize cost and schedule
growth? And when NASA is faced with an unexpected cost growth
and schedule delay, what are the tradeoffs that NASA can make?
And give me some examples of successful tradeoffs.
Mr. Jurczyk. Yes, so, you know, I think we continue to
mature and effectively apply the joint confidence level process
is going to be really important. And I've seen--since 2009,
I've seen the value of that in budgeting projects at the agency
based on coming in at the 70 percent confidence level, and I
think we can do even better there in maturing that process. And
I've seen success, and I think we need to continue to have
success there.
I think we can--we need to continue to focus on development
of the project management workforce and the program planning
and control workforce has been noted, including, you know,
hiring and developing the talent through hands-on project
management and project experience and training.
About 15 years ago, we identified a shortage of skills in
project planning and control, and we've really taken on an
effort to hire and train people in that area, cost estimating
and schedule estimating and management, and I think that's paid
off. We need to continue to do that.
We talked about independent assessments, and we can
continue to strengthen independent assessments.
And then we have capturing and communicating lessons
learned and looking for systemic issues and challenges across
programs and putting corrective action plans in place to deal
with those like the shortage of program planning and control
staff. We need to continue to do that. And I think all those
things can lead to improved program project--continued improved
program project performance.
Ms. Johnson. Thank you very much. My time is about out, but
would any other witness like to comment on any of the
questions?
Ms. Chaplain. I would just add a couple more things to his
list. One would be to update cost estimates and schedule
estimates as risks change over time. We see programs reluctant
to do that. And then focusing more on quality management
because these workmanship issues come up all the time. There
has been efforts to focus on that, but I think more can be
done.
Mr. Dumbacher. Congressman, I would like to add also
there's also--there is a need to recognize that you need
appropriate skills for the portion of the program lifecycle you
are in. So development skills are needed upfront in a
development program, operational skills at the end, and we need
to make sure that we're working for the right skills at the
right time.
Ms. Johnson. Thank you very much. Thank you, Mr. Chairman.
Chairman Babin. Yes, ma'am. Thank you.
I'd like to recognize the gentleman from Oklahoma now, Mr.
Lucas.
Mr. Lucas. Thank you, Mr. Chairman.
And thinking about the questions that my colleagues have
had, Mr. Jurczyk, let's discuss for a moment in January of 2018
GAO found that the commercial crew program contractors Boeing
and SpaceX experienced additional schedule delays for their
demonstration missions and their certification of the vehicles
for human spaceflight, and these delays could jeopardize the
ability of NASA to maintain access to the International Space
Station. Will there be a gap in U.S. access to the
International Space Station?
Mr. Jurczyk. No, there will not be a gap in access. We've
taken actions and we have other actions we can take to minimize
the risk of a gap, so the first action we have taken is to buy
three more seats on Soyuz, and that extends the ability to
access station by that capability and minimizes the risk of any
gap between our Soyuz contracted seats ending and commercial
crew coming online.
There's a couple other things that we're looking at. One is
adding a third crewmember to the first Boeing crewed flight.
That will be important. The other is extending missions from
approximately 140 days to 190 days and being able to space the
launches--the Soyuz launches out, and these are other actions
we can take to further mitigate any risk of a gap.
Mr. Lucas. But you're confident that the direction the
contractors are going, that we won't have to use those
measures?
Mr. Jurczyk. We--this summer, we're engaging in an
assessment of the schedules for both SpaceX and Boeing, and
we'll have a better handle on whether we need to take those
initial measures at the end of the summer. We'd be glad to
report back to you on that.
Mr. Lucas. Fair enough. Mr. Chairman, that answers my
question. I yield back.
Chairman Babin. Yes, sir. Thank you.
And now, I'd like to recognize the gentleman from Virginia,
Mr. Beyer.
Mr. Beyer. Mr. Chairman, thank you very much, and thank you
all for being here.
Ms. Chaplain, you mentioned that it would be helpful to
have much more frequent updates of cost and timelines, that
these come very sporadically. I know in the family business we
update the projections at least once a month. Here in the
Federal Government we're getting all kinds of monthly reports
on new-home sales and unemployment claims and new jobs created.
Why are NASA and the contractors reluctant to update on a
regular basis when it would be probably a lot easier to
tolerate?
Ms. Chaplain. Yes, it would be easier if they continually
did it because then it wouldn't be such a chore to do it after
a couple years. But right now, they set the baselines when they
really start their program, and they don't revisit. And in some
cases I think they don't want to revisit. They don't want to
really show to the world like what the cost truly is at that
point. But you'd really have to ask the programs. I think it's
a healthy thing to do when you see conditions change.
In the James Webb program there were a lot of things that
had changed in a few years. The cryocooler, for example, took
way longer to manufacture than anticipated. That would have
been a good time to reassess where the project stood, but they
didn't do it.
Mr. Beyer. This may be one of the things as we move forward
is looking at requiring much more frequent updates on both cost
and timeline.
Mr. Dumbacher, this may be more of a rhetorical editorial
comment, but you write, ``The current budgeting process,
including the regular use of continuing resolutions, late-year
appropriations, threats of government shutdowns, result in
endless, multiple planning scenarios.'' Resolving complex
technical issues, hold schedules, and predicting accurate
flight dates is difficult when the budget is constantly in
flux. Is it then credible to say that Congress plays a role in
the problems that NASA has with budget and timeline?
Mr. Dumbacher. Yes, sir, I would say that.
Mr. Beyer. You don't need to say anymore. But thank you for
making that so clear.
Mr. Jurczyk, why not under-promise and overperform? I know
that's what my children do with me.
Mr. Jurczyk. Yes. So, you know, our job on--in any given
program area is to optimize the portfolio and deliver the most
science or exploration missions that we can for the budget
given. So we have, you know, taken an approach of having a
portfolio of small, medium, and large missions and an approach
where we budget these missions at the 70 percent confidence
level. We think that balances the risk of projects in
formulation and implementation against the opportunity cost of
budgeting more than at the 70 percent confidence level and
delaying starting new missions. So it's a matter of optimizing
the portfolios and delivering the most science and exploration
content we can for the budget that we have been given.
Mr. Beyer. I would suggest to you that part of optimizing
that is managing the expectations of the people whose
expectations you have to----
Mr. Jurczyk. Yes, we can definitely do a better job at
managing expectations.
Mr. Beyer. Mr. Martin?
Mr. Martin. I think one of the other realistic things is if
you under-promise, you're in greater danger of not getting your
project started in the first place, of attracting enough
excitement and attention to get the project funded. So I think
what NASA's problem is often is they overpromise, obviously
overpromise the maturity of the technology.
I was struck in the--like a lawyer going over the footnote
on page 3 of our written statement, there's a quote from former
Administrator Griffin. I think he was current Administrator at
that time talking about projects, proponents of individual
missions, downplay the technical difficulty and risk, grossly
at times, in order to gain new start funds. I think that has
been a historic problem for NASA.
Mr. Beyer. You raised two interesting pieces in your
testimony, Mr. Martin. One was that there's this culture of
optimism that was too optimistic, and, number two, that we
needed far more accountability. But at the same time, the
dilemma with the accountability is we also have a shortage of
the talent that we need, you know, more than half are over 50
years old, the challenge with getting the STEM kids. How do you
ratchet up accountability and not depress, you know, the
enthusiasm, the sense of worth? And also how do you dampen out
the optimism in an agency that has to be so optimistic?
Mr. Martin. It's an incredibly difficult--you're dancing on
the edge of a knife when you do that because, as you point out,
you have to have that optimism, that freethinking to really
think of things that have never been built before, to
conceptualize them and then actually put--to start bending
metal on them. So it's an incredibly difficult balance.
If it was easy, NASA would be doing it. I mean, it is
rocket science after all, and so it is very difficult. And I
just think--and, like I said, NASA has brought in a lot of its
cost-estimating techniques and its JCLs and other processes--
they just need to force adherence to it, to those requirements.
Mr. Beyer. Great. Thank you. Mr. Chair, I'll yield back.
Chairman Babin. Yes, sir. Thank you.
Now, I'd like to recognize the gentleman from Alabama, Mr.
Brooks.
Mr. Brooks. Thank you, Mr. Chairman.
I am concerned by the perceived transition process away
from the current operational format of the International Space
Station. There have not been, in my judgment, enough
substantive public debate on what this transition involves.
And with that as a backdrop, I have a question directed at
Ms. Chaplain, Director, Contracting and National Security
Acquisitions, GAO; and NASA Associate Administrator Stephen
Jurczyk. First, has NASA come up with a definition of what
commercialization of the International Space Station means?
Ms. Chaplain. We have not been doing work in that area, and
I don't believe they have yet, but I'll let Steve----
Mr. Jurczyk. Yes, so let me tell you where we are with I
would say the more detailed planning of the station transition.
So we released a solicitation not too long ago for studies,
industry studies on transitioning space station to some sort of
collaborative or commercial enterprise. We're getting the
proposals back in this week, and we'll evaluate those.
And what we asked for in those studies is the capabilities
that commercial thinks they can provide us as compared to what
we need and what we have and we need in the future. The second
is their technical approach to achieving those capabilities.
And then third is their business plan. You know, what is their
business plan? Because, although we don't have a rigorous
definition, NASA should be a maybe 20, 30 percent user of the
capability and other government entities and commercial
entities should also use that capability. We should not be the
80 or 90 percent, you know, kind of anchor tenant of a
capability. To me--personally to me, it's not--I would not
define it as commercial.
So we're going to get those studies back in December, and
that will inform a more detailed transition plan. And I think
we'd be ready to come to you all and present that plan and get
your feedback and input on it.
Mr. Brooks. When do you anticipate having that more
detailed plan that you can present to us that we have a better
understanding of what this commercialization means?
Mr. Jurczyk. Yes, we'll get the results from the studies in
December of this year, so we'll probably need some number of
months, so probably, you know, first half of next calendar year
we'll definitely be able to come back to you and lay that out
informed by that--those industry studies and industry input of
what looks feasible in the mid-'20s time frame.
Mr. Brooks. So you would be in a position to answer the
question in the first 6 months of 2019? Is that correct?
Mr. Jurczyk. Yes. And I can take a question to get back to
you on a more exact date if you'd like.
Mr. Brooks. All right. Thank you.
Mr. Martin, your audit of commercial resupply services to
the International Space Station report dated April 26, 2018,
notes that, quote, ``SpaceX's average pricing per kilogram will
increase approximately 50 percent under CRS-2 while Orbital
ATK's average per-kilogram pricing will decrease by roughly 15
percent.'' The major difference between those contracts is
SpaceX's introduction of reusability. SpaceX has noted multiple
times that customer should not expect substantial discounts on
reused hardware.
My question is this: Are you concerned about whether
taxpayers will save money with reusable rockets? And second
follow-up question is, is it possible reuse may end up costing
NASA and the United States taxpayer more overall?
Mr. Martin. Steve could probably answer this more
specifically, but I believe there is a slight reduction in the
area of 3 to 7 percent for use of a reused SpaceX rocket. I
think it's happened once if not twice so far for commercial
cargo, so there is a slight reduction.
And am I concerned? I mean, it's a safety issue, and so the
launch services people need to assess the specific rocket, and
they have access to the rocket, before they authorize them for
launch.
Mr. Brooks. Well, Mr. Jurczyk, since Mr. Martin pointed the
finger at you----
Mr. Jurczyk. Yes.
Mr. Brooks. --with your insight, can you----
Mr. Jurczyk. Yes, I think----
Mr. Brooks. --share what insights you may have on that
question?
Mr. Jurczyk. Yes, I think Mr. Martin is right with respect
to the marginal cost reduction, with the introduction of the
reusability of the first stage of the Falcon 9, and they're
also working towards reusing the fairing and they recently
are--announced that they're looking at approach to reuse the
upper stage also.
I think as we--as they gain experience and as anybody gains
experience operationally with the system and they gain
experience with reuse, I think there is opportunity to further
reduce the risk and reduce the cost, my understanding what the
condition of the hardware is when it comes back and how much
effort it takes to recondition it, to re-fly it, so there's
opportunity there. I'm not able to predict what additional
savings they might achieve through reuse at this point.
Mr. Brooks. Is there any chance you could expound on
increased risk factor of using a novel approach, i.e., reusable
rockets?
Mr. Jurczyk. Yes, we're--like Mr. Martin said, we're--the
Launch Services Program is in the process of assessing that
risk for all missions, and I can take a question for the record
on that to get back with you when that assessment will be done.
Mr. Brooks. Please. Thank you, Mr. Chairman.
Chairman Babin. Thank you. I now recognize the gentleman
from Pennsylvania, Mr. Lamb.
Mr. Lamb. Thank you, Mr. Chairman.
Everyone, I appreciate you highlighting the difficult
position that you're in when it comes to unpredictable funding
streams, threats to shut down the government, funding by CRs,
that kind of thing. I'm trying to learn a little bit more about
how that actually affects you on the ground day-to-day. This is
a question for anyone. Can you share some more specific
examples of how that might have affected a particular project?
Mr. Dumbacher. Well, I'll be happy to take that because I
lived it for a while. And what happens, Congressman, is when
you're working on a program and you're trying to put the plan
together for the future and what's my workplan for this year,
what's my workplan over a five-year budget horizon? And as I'm
working through the appropriations budgeting process, every
time I'm--I have to plan to a different number, that means I've
got to go back through that planning iteration process.
So at a time when the President's budget request was
significantly different from what was typically coming from the
appropriations process, it was necessary to--A, to do the plan
that was supportive and was inclusive in the President's budget
request, and I had to be ready as a program manager that if
additional appropriations did come in, I at least had an
ability to plan and be able to react to that.
Mr. Lamb. And what type of program were you managing that
you're talking about right now?
Mr. Dumbacher. At the time I was doing this, this was the
beginning of the SLS and Orion programs.
Mr. Lamb. Okay. And so that was a program that was supposed
to take how long kind of from start to finish?
Mr. Dumbacher. At the time I was there, we were looking at
first launch in the 2017, 2018 time frame, and in the--while
I--during my tenure as the Program Director for SLS and Orion,
we had to deal with a government shutdown, continual
negotiations on both ends of Pennsylvania Avenue, and then in
addition to that, while I'm doing all that planning, my--the
team's focus is pulled away from the day-to-day management of
these technically complex jobs. So we were working through all
of that and actually had to deal with a government shutdown and
work through that and then all the multiple planning cycles.
Mr. Lamb. Thank you. And, Ms. Chaplain, it seemed like you
had something to add.
Ms. Chaplain. I think I've heard very similar things from
other agencies that I oversee like Missile Defense, that kind
of constant re-planning and the chaos and time that it
consumes. But another real example of like the impact of a
shutdown can have is a cryocooler--or cryo test at the end of a
program like James Webb, it might take a couple weeks to get
the facility ready for this test and then two weeks to cool
down, and the shutdown--I think there was a shutdown threat
while there were doing that test this time, and they were
really worried, like if we had to shut down, we're going to
lose a whole month of time.
Mr. Lamb. Okay. Thank you very much.
And, again, a question for really anyone because I think
it's pressing, but some of you have highlighted the workforce
development issues that you have within NASA, and I think it
was Mr. Dumbacher that talked about young people especially
leaving NASA for higher-paying jobs in the private sector,
which is a challenge obviously across the government. It
happens in the military, too. But if there was one reform you
could suggest or one thing that we can improve or strengthen to
retain some of this talent and to attract new talent, what
would it be?
Mr. Dumbacher. Well, as I stated in my testimony, the one
thing I would recommend is good real hardware programs that--to
go address those technical needs that we need for space
exploration and for the NASA mission but to go give these
students, give these young professionals real hands-on hardware
experience because that informs their capability and informs
their experience throughout their career.
Mr. Jurczyk. Yes, I would just like to second that. The
first project I worked on after I got out of college was a
spaceflight instrument development project in-house at NASA
Langley Research Center, so I was able to design, build,
integrate, test all the way through environmental test flight
hardware, and that experience was critical throughout my entire
career as I moved to a Subsystem Manager and Systems Engineer
and Project Manager and then Line Manager. So I would just
second that. I--it--without that experience, I don't know how I
would have been able to be as effective as I was as I moved
through my career at NASA.
Mr. Dumbacher. And if I may just give you a little bit of a
story, too, if you stand back and look at--there are a group of
people of which I was one, Robert Lightfoot was one, where we
had the ability and we were asked and required by our mentors
to actually test shuttle main engines in-house, and we tested
the new technology that ultimately became the final flight
configuration for shuttle. And that hands-on experience--they--
our mentors, our leaders forced us into that because they knew
that it fit into the long-term career.
Mr. Martin. Just echoing the same thing, we've heard from a
number of Project Managers that we've spoke with, their
frustrations about their spending--agency engineers are
spending most of their time overseeing contractors' effort, and
that's frustrating.
Mr. Lamb. Thank you. Thank you, Mr. Chairman.
Chairman Babin. Yes, sir. Thank you.
I'd like to recognize the gentleman from Louisiana, Mr.
Higgins.
Mr. Higgins. Thank you, Mr. Chairman. Mr. Chairman, it's
uplifting to see these young Americans here today, these NASA
interns, and I hope you young men and women are paying
attention to these budget discussions. We are a nation that's
$20 trillion in debt. And should this body ever manage to
produce a surplus, say, $1 billion, it would require 20,000
years of $1 billion surplus to address a $20 trillion debt.
So I'm prayerful that NASA has a spirit of doing more with
less because not only are individual projects at risk, but
certainly anyone can recognize that a $20 trillion debt puts
the entire stability of all programs at risk in every
government agency. I'm very hopeful that you young Americans
are paying close attention to this conversation.
Mr. Martin, I'm concerned about the culture of optimism
that you referred to and the too-big-to-fail attitude amongst
Project Managers. But I understand their perception that their
projects are too big to fail because in every case a tremendous
amount of American treasure has been invested in that project,
and therefore, it's quite logical for these Project Managers to
have this cavalier attitude of too big to fail. What can this
Committee do, what can Congress do to ensure projects are
developed and managed within their budget constraints,
including--I'd like your thoughts, sir, regarding
accountability for our contractors within these projects.
Mr. Martin. Again, I think more frequent conversations with
Members of Congress about the status of individual projects is
important, more fidelity to the cost estimating that NASA does
right now, and then the occasional example that projects large
or small are going to be terminated if they go too far over
cost and schedule. And in preparation for this hearing, I think
the last project that I remember being canceled was something
called GEMS. It was a telescope that was supposed to look for
evidence of black holes, and it was a smaller program from
NASA. It was capped at $105 million. And then partway through
formulation, they realized in an independent cost assessment
that it was going to be 20 or 30 percent over that $105 million
cap, and NASA canceled it. And it got people's attention.
Mr. Higgins. Generally speaking, the contractors that are
involved in cost overruns for NASA projects, large projects,
these are for-profit companies, are they not?
Mr. Martin. They are, sir.
Mr. Higgins. And has that ever been addressed within the
leadership at NASA, that, you know, most Americans, if we
receive a bid from a professional contractor to perform a
particular service, then we expect that service performed for
the price that was bid. And they're held accountable legally by
civil law, and there's a certain expectation of performance
when you're giving a bid. And yet within the Federal Government
and certainly within NASA's large projects there seems to be an
attitude of well, we're not really accountable for the actual
bid that we presented, and we won't be forced to perform.
Mr. Martin. He's NASA leadership.
Mr. Jurczyk. Okay. So, yes, the--most--a lot of the time
we're doing things--building--designing and building systems
for the first time that no one else has ever built before, and
so in those cases we use a cost reimbursement contractor. And
the incentives--and we use incentives to hold the contract
accountable through a performance evaluation plan. And those
incentives are tied to fee, usually award fee, and that is
their profit. So if they do not perform and--they should get a
low score against their performance evaluation plan and either
receive much less profit or no profit depending on how we
weight the incentives in the plan and how they're scored.
So given the high-risk nature and--the nature of what we
do, very complex systems, very high-risk with new technology,
we take that approach, and then we hold them accountable. And
the ultimate price to pay for them if they don't perform is
loss of--complete loss of profit.
Mr. Higgins. Gentlemen, thank you for your response.
Mr. Chairman, my time has expired. If there's a second
round, I have a question for Ms. Chaplain.
Chairman Babin. Yes, sir. Thank you very much.
Now, the--Mr. Foster.
Mr. Foster. Yes. Thank you. And I guess I'd like to start
just by making an observation about the--you know, the amount
of funding that you can think about having in the next decades.
Last week, the Federal Reserve made the historic announcement
that household net worth in the United States, the wealth of
Americans, just went over $100 trillion. This is up $45
trillion since President Obama signed the stimulus, reversed
the economic collapse, and triggers the economic growth that's
going on today. So when people tell you there is not enough
money to do this or that, the scale for that is what fraction
of $100 trillion might we think about, you know, using to
travel to Mars or wherever--whatever your dream is.
I also want to say that I resonated--as a former Project
Manager and someone doing technical components for large
federal projects, I very much resonated with your desire to
retain in-house expertise. It is very, very difficult to manage
a project if you've never done it yourself. And so when I
decided that I had to manage a group doing a large number of
integrated circuits, I learned all the integrated circuit
design control tools and made integrated circuits myself before
I decided that now I could sit at the top and emit
specifications for other engineers.
And this is crucial, and we have to look very carefully
when we--this rush to privatization runs the risk of losing the
in-house expertise that will ultimately cost more money because
you'll have projects that are not managed as well as they could
be. So I just--we ought to be very cognizant of that as we
contemplate this transition.
Now, you know, when I think about cost overruns, you know
they're sort of two big general classes. The first ones are in
enthusiast cost estimates, you know, in the initial scoping of
a project, the initial scoping is always done by people who are
advocates for the project, and then you have to get adults in
the room with experience to actually pull back and say, okay,
how does this compare to actual cost?
The other one is legitimate technical risk. And I would
just like to say that I would hope that my colleagues in
Congress would be much more tolerant of technical risk. You
know, it is okay to take significant technical risk. And if you
assemble a group of experts that say success is not assured but
this looks like a good bet and then it turns out you lose the
bet, then Congress should be, you know, very understanding and
tolerant but much less tolerant when projects are approved when
everyone in the room knows the--you know, I don't want to point
fingers, but I'm sure in your minds you know several projects
that have been approved where a large number of the people knew
that you weren't really going to get the project done for that
cost. And it's not just NASA. This happens everywhere in the
government.
And so I just was wondering, are there ways that you can
identify retrospectively the times when you've had enthusiast
cost estimates? Are there any sociological red flags that would
allow you to say, okay, I'm suspicious that this is not a real
cost estimate? Yes.
Ms. Chaplain. I always--I can tell like when I'm
suspicious. It's usually when there are very grand statements
made about the program and the achievements that it's going to
get seem overly exaggerated. And that's when you start
wondering, are these estimates real?
What I would say in the case of NASA, I kind of trust the
process that they have because they do review those estimates
pretty carefully. They have standing review boards that look at
them before they make their decisions. They could have more
independent estimating to kind of compare. That's one thing.
But I do believe that their processes now, as opposed to a few
years ago, are pretty rigorous in ensuring those estimates are
complete.
I would just add, one thing you said about taking risks,
you know, that's--you need to still do that. I think there is a
concern within NASA and other places in the government that
we're not taking enough technical risk, that we're too afraid
to do that.
Mr. Foster. Yes, I concur.
Mr. Martin. With respect to science missions, NASA relies
extensively on the findings of the National Research Council
and their decadal surveys that identify specific projects, so I
think that's another check as opposed to----
Mr. Foster. No, they don't do cost estimates. They're sort
of given external estimates is my understanding.
Mr. Martin. I think they do cost--they don't do very good
cost estimates, but they do cost estimates.
Mr. Foster. Yes. That's where you need the expertise and
judgment, at that stage. Yes.
Mr. Dumbacher. And if I may, Congressman, is when I think
back on my career and some of the places where I've seen this
problem occur the most, one key thing stands out, and that is
have the people doing the cost estimate be the ones that will
be held accountable for the program execution. I have seen a
couple of instances where the people making the initial
estimate putting the plan together knew that they were going to
be moving on to something else and then they brought the new
person and the new person was what's this?
I think if you--if there is an air of accountability and
they know that they're ultimately accountable for that cost--
for executing to their cost estimate, that starts to get the
behavior where I think you want it sociologically.
Mr. Foster. Thank you. And it's--well, there's a whole set
of questions when you go to an external contractor model, who
does the cost estimate and who takes the responsibility in that
model?
I guess I'm out of time here.
Mr. Brooks. [Presiding] Thank you. The Chair recognizes
Congressman Dunn from Florida.
Mr. Dunn. Thank you very much, Mr. Chairman. Jump right in
here.
Mr. Jurczyk, the Canadian Space Agency last month canceled
its participation in WFIRST project for budgetary reasons. In
your assessment what will the impact be to the technology
development and the cost which results from CSA's decision to
pull out of the WFIRST?
Mr. Jurczyk. Yes, so that decision was factored into the
projects re-planning after the independent review of WFIRST and
was factored into the plan they brought forward to move from
phase A to phase B. So they've been able to adjust scope and
adjust their cost and schedule estimates to stay within the
$3.2 billion and still without the Canadian contribution, so
that----
Mr. Dunn. How does that affect the technology development?
Mr. Jurczyk. I don't think it significantly affects the
technology development. I think that the project has a really
good plan to early on develop prototype hardware----
Mr. Dunn. All right.
Mr. Jurczyk. --to reduce the risk of that element, as well
as other elements of high risk----
Mr. Dunn. How about the mission itself? Does the
capability--the mission goals, do they change because----
Mr. Jurczyk. No. No, the level-one science goals do not
change, and they will meet the requirements of the mission as
defined in the NRC decadal survey for astrophysics.
Mr. Dunn. That's great news. So the '18 omnibus bill
required a lifecycle cost estimate by May 22. That's behind us.
When will that be submitted to Congress?
Mr. Jurczyk. We will get you that within the next couple of
weeks. It's been done, and they're just wrapping up the
documentation, and it will be here hopefully within the next 2
or so weeks. That's our plan.
Mr. Dunn. Great. So many people here on the panel have
called the assessment--many assessments, that you need stable,
predictable funding to plan. So let's close our eyes just for a
minute and imagine that Congress might provide multiyear
funding authority. It's a pleasant fiction, I know, but let's
imagine that. In that scenario, how would that--how would this
authority change your planning for your programs?
Mr. Jurczyk. Well, I think it would allow us to only plan
once and execute to that plan and deal with the challenges that
Mr. Dumbacher had articulated before.
The one example that we have of getting multiyear funding
was OV-105, which is the replacement orbiter after the
Challenger accident where Congress appropriated multiyear
funding for that project. And they were very successful in
executing on schedule and on budget with the profile that
ramped up, peaked, and ramped down like any project--rational
project plan should, and having the money--the adequate money
when they needed it, so that's just an example of what you're
talking about.
Mr. Dunn. So that might actually be good for a lot of
different agencies in the government?
Mr. Jurczyk. For any large complex program that's going to
take multiple years to execute, I would think so.
Mr. Dunn. I'm thinking Ms. Chaplain would love that, right?
So let me--in our limited time, so again for--well,
actually, Mr. Jurczyk, you may be under constraints, unable to
answer this. I think we're all disappointed that the James Webb
Space Telescope cost overruns missed--and missed deadlines.
What programmatic changes would you make to that program to
prevent that in light of that failure? Can you answer that?
Mr. Jurczyk. I can tell you what we have done----
Mr. Dunn. Okay, good.
Mr. Jurczyk. --to date, and so the first is a series of
actions that we worked on with Northrup Grumman. So, first of
all, we completely restructured the I&T organization in
Northrup to flatten it and be able to more clearly hold people
accountable for getting through the integration and test
program. That also has allowed them to identify and resolve
issues in a more timely manner to minimize the impact of those
issues.
We've also added staffing to the I&T team out at Northrup,
and we've really strengthened the mission assurance function
and personnel out there to deal with some of the workmanship
and quality issues that were mentioned by Ms. Chaplain and
others to try to avoid these human errors that have caused
schedule delays. Like was mentioned, a small error or problem
has a very large effect on a program like JWST.
Mr. Dunn. I can well imagine. In the 30 seconds remaining,
Mr. Martin, do you have anything to add to Mr. Jurczyk's
comments on that?
Mr. Martin. Yes, we have not done significant oversight of
JWST. Congress directed----
Mr. Dunn. How about you, Ms. Chaplain?
Ms. Chaplain. Yes, I believe the actions they've taken have
been reasonable. I would note they were--already had some
onsite presence over at NGAS, but we'll be looking to see how
effective those actions are as we do our next review.
Mr. Dunn. Well, here's wishing you multiyear funding
authority. And with that, Mr. Chairman, I yield back.
Mr. Brooks. The gentleman yields back.
The Chair recognizes Representative Lofgren from
California.
Ms. Lofgren. Thank you, Mr. Chairman. I think this is an
important hearing, and most of the questions have been asked,
but I would like to think about what further Congress could do
in addition to avoiding the kind of situations Mr. Lamb
addressed, the shutdowns issue, the inconsistency between the
President's requested budget and what's appropriated that lends
uncertainty to the planning process. What could Congress do to
limit the uncertainty in funding other than those two issues?
The idea of a multiyear funding program for large projects is
valuable, but can you give us further guidance to stem losses
through our own actions?
Ms. Chaplain. I'd--I'll start. I would say avoid over-
specifying what your expectations are, avoid setting dates for
a program, avoid choosing, you know, how they're going to do it
because that limits their choices even more in what they can
do.
Mr. Jurczyk. Yes, I would just echo that. We seem to be
getting more and more direction through the appropriations
process, particularly through the report, and we're--the
expectation is we will follow that direction. And that
constrains the solution space and our ability to manage
effectively sometimes, so I'd say just to echo what Ms.
Chaplain said. I think that's one additional thing I could
think of.
Mr. Martin. With respect to the funding issues, not only
the actual dollar amount, it's when that dollar amount comes,
the proper phasing----
Ms. Lofgren. Right.
Mr. Martin. --of the appropriation has impacted NASA
programs.
Mr. Dumbacher. I would add work to make sure that the
environment in which we have these discussions is less punitive
and more objective and more willing to hear the risks and
understand the issues. I think we have to be careful that a lot
of the--that we can be--you've inadvertently set up a vicious
cycle of oversight leads to conservativism leads to more
oversight, and it just keeps going around in a circle. And I
think what Congress can do and this Subcommittee can do because
of its oversight activities is to help establish an environment
that allows more open communication on these kinds of issues.
Ms. Lofgren. Well, I think the point that Mr. Foster made
all scientists know, which is failure is a learning experience.
I mean, science is testing and not knowing the answer before
you start. And we need to foster that sense of discovery and
willingness to take risks if we're going to be successful.
Let me just close with sort of a parochial question. I
represent part of Santa Clara County. NASA Ames is located in
Santa Clara County. And thinking about the demographic issues
we face in NASA with so much of the workforce being over 50
years of age, the NASA Ames facility is located in a key part
of the country. It's in Silicon Valley, and there's a lot of
synergy between what's going on in the tech community and NASA
Ames. And although it's very expensive to live in Santa Clara
County, actually, they just built some housing for NASA
employees so that it's possible to maintain their--that
synergy.
I'm just wondering in terms of that facility as well as
others that are co-located with technology centers, what
further we can do to move top scientists away from really
better-paying jobs into the agency to make young people who are
smart and who are good scientists want to work in NASA? If
anybody has an answer to that.
Mr. Dumbacher. I'll take a try at it. I think what the
young people want now is similar to what the young people
wanted when I got out of school. They want exciting work, they
want to know that they have an opportunity to make a
difference, and they want to help solve today and future
problems. And I think providing those and then in addition to
the infrastructure kind of options that you have described
would be extremely beneficial.
I think they want to--from my experience teaching at Purdue
for a few years is if you hit those first three bullet, then
the students will come. That's why they go to SpaceX and Blue
Origin. They see exciting work. That's why they still want to
come to NASA because NASA still has that cachet that it's
always had. So exciting work, help make a difference, and do
something quick, and I think you'll be a long way down the
road.
Ms. Lofgren. Thank you very much. I see my time is expired,
Mr. Chairman, so I yield back.
Mr. Brooks. Thank you for your questions and participation.
The Chair next recognizes Representative Rohrabacher of
California.
Mr. Rohrabacher. Thank you very much, Mr. Chairman. I
apologize for being late to the hearing. Obviously, two
important hearings have to happen at exactly the same time,
which perhaps leads me to the first point, which is we need to
make sure we hold NASA accountable, but I have to assume that
the Congress isn't doing its job all that well either. And when
we're talking about continuing resolutions and omnibus bills, I
mean, that's a reflection on the fact that we aren't doing our
job here as well. So please don't think if there's any
criticism here coming from this end that we don't realize--or
at least some of us don't realize that there is justified
criticism of the way Congress is doing its job.
Let me ask a couple of questions here about these cost
overruns and--that seem to be around. They've been around as
long as I've been around. And let me ask you this. Is a lot of
this intentional low bidding on the part of companies in order
to achieve a contract? Is this part of that? And to whoever can
answer that question.
Mr. Jurczyk. You know, we have a pretty rigorous request
for proposal and proposal evaluation process, including
independent cost and schedule estimates by the government to
ensure that what's being proposed is actually executable.
What's being proposed in that contract is executable.
Mr. Rohrabacher. So it's not to say you don't see this as a
scheme by some big corporation to intentionally bid low, get
the contract, and then realize we're going to have to pay for
it later on?
Mr. Jurczyk. I do not.
Mr. Rohrabacher. Okay. Anybody believe that at all? Good.
Thank you. That helps our understanding of this.
And a lot of these companies that do have the cost overruns
are companies that are worth billions and billions of dollars
themselves. If--what penalty does a company have that goes
through a major cost overrun and doesn't meet its commitments
through a contract? What's the punishment?
Ms. Chaplain. So, as we discussed earlier, you can take
actions to punish companies just through award and incentive
fees, but often, they're tied to multiple objectives so you're
limited in terms of what you can do. So the ultimate thing is
just to cancel a program if you really feel like----
Mr. Rohrabacher. Well, what about the next program? Can a
company that did not meet its contract be denied the next
contract or a contract down the road because they have not met
their obligation?
Ms. Chaplain. Yes, I think that's possible. And the
proposal that's in your bill about a contractor watchlist, they
could go on that list if they're not performing well and that
NASA will not deal with them in the future for a period of
time. That is one option. I didn't know if you want to comment.
Mr. Rohrabacher. Yes, maybe you could expand on that for
me.
Mr. Jurczyk. Yes, so what we do now--first of all, we have
a very robust acquisition integrity program within the agency
that's run by our Office of Procurement and our Office of the
General Counsel and so, you know, they, along with the
programs, look at contract performance and we'll use the FAR
process for suspension and debarment for lack of performance or
for waste and abuse, you know, so we use the existing process.
The other thing we do is we have the contractor performance
assessment reporting system, so when we evaluate a contractor
on a regular basis, that assessment goes into that system, as
well as the assessments of all of the departments and agencies
within the Federal Government, and then not only NASA but other
departments and agencies can draw on that to use in assessing
past performance of the contract to determine whether to award
them anything in the future.
Mr. Rohrabacher. Well, it seems to me that we have to be
much more diligent on--in that area and--if--unless we have
accountability and responsibility for these things, we can
expect to have more problems. And I have to assume that we did
not have the amount of discipline in our system and the
accountability that will deter companies--perhaps maybe
companies that make bids should be held responsibility for that
bid, meaning that the money that's lost perhaps should be
absorbed by the company. As I say, these are multibillion-
dollar companies, and if they're going to be taking the
taxpayer money and failing in what they're claiming to do, why
should the taxpayer pick it up?
We have--we just mentioned a--we have $20 trillion debt,
and the gentleman mentioned how that is--if there's anything
that's going to keep us from going into space, it's going to be
the total disintegration of our economic system so that we
can't afford any of this stuff.
I would--also, let me just note that we're also going to
have to--we have a $20 billion budget for NASA, $20 billion. We
should be able to do a lot with $20 billion. And let me just
note that when I first got involved that I realized that the
budget wasn't enough to accomplish the missions, and that's why
I dramatically--I tried to focus totally on international
cooperation and private sector investment. So let's hope that
we--that's one avenue of making more revenue come in, but we
also have to make sure we pay attention to what this hearing is
all about is making sure that we're managing the actual
projects themselves in a way to minimize the loss of very
scarce dollars.
So thank you very much, Mr. Chairman.
Mr. Brooks. Certainly. The Chair thanks the gentleman for
his participation.
We're nearing the noon hour and we're going to finish by
noon, but from what I understand, there may be a member who
wishes to ask a second set of questions, and as long as we are
able to do so within that time frame, the Chair is most
comfortable in doing so.
Mr. Higgins, did you want to do follow-up?
Mr. Higgins. Thank you, Mr. Chairman. I have one question.
Mr. Brooks. Well, one second. The Chair recognizes
Representative Higgins of Louisiana for that follow-up.
Mr. Higgins. Thank you, Mr. Chairman, for recognizing me
and allowing me to ask one question to Ms. Chaplain.
Ms. Chaplain, NASA has received multiple recommendations on
ways to better develop cost and schedule estimates, as well as
perform joint cost and schedule confidence level analysis
during the beginning stages of the implementation phase of
large projects. In December 2012, it was recommended that the
JWST project update its JCL. According to the report, NASA
concurred with this recommendation, and yet no steps were taken
to implement it. Further analysis indicates that, if
implemented, an updated JCL may have prevented schedule delays.
Among the many known and unknown challenges that NASA
encounters regarding cost and schedule continuity, can you
elaborate on why this recommendation was purposefully
overlooked?
Ms. Chaplain. At the time they did concur, as you said, so
I didn't ever have an official reason why it was overlooked. I
think they just were reluctant to relook at their costs. A
couple years later, we recommended that they at least do
something similar to do a cost schedule risk analysis and
really take a deep look at their risks, and we even were going
to do that ourselves, working with the contractor, but that was
rejected by the contractor. And then it wasn't until they were
getting ready to work with the launch agency on setting the
date that they actually did a schedule risk analysis themselves
and realized how far behind they really were.
Mr. Higgins. Ms. Chaplain, thank you for your candid
answer.
Mr. Chairman, thank you for allowing me to ask a second
question.
Mr. Brooks. Certainly.
Any other member wish to ask any other follow-up questions?
Seeing none, I thank the witnesses for their valuable
testimony and the Members for their questions. The record will
remain open for two weeks for additional comments and written
questions from Members.
This hearing is adjourned.
[Whereupon, at 11:57 a.m., the Subcommittee was adjourned.]
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