DOD releases selected acquisition reports: Department of Defense news release - August 15, 2003 - In The News

Program Manager, Sept-Dec, 2003

The Department of Defense has released details on major defense acquisition program cost and schedule changes since the December 2002 reporting period. This information is based on the Selected Acquisition Reports (SAPS) submitted to the Congress for the June 30, 2003, reporting period.

SARs summarize the latest estimates of cost, schedule, and technical status. These reports are prepared annually in conjunction with the president's budget. Subsequent quarterly exception reports are required only for those programs experiencing unit cost increases of at least 15 percent or schedule delays of at least six months. Quarterly SAPs are also submitted for initial reports, final reports, and for programs that are rebaselined at major milestone decisions.

The total program cost estimates provided in the SARs include research and development, procurement, military construction, and acquisition-related operation and maintenance (except for pre-Milestone B programs, which are limited to development costs pursuant to 10 USC [section] 2432). Total program costs reflect actual costs to date as well as future anticipated costs. All estimates include anticipated inflation allowances.

The current estimate of program acquisition costs for programs covered by SAPs for the prior reporting period (December 2002) was $1,129,668.4 million. After adding the costs for new programs that were reported in the December 2002 reporting period and subtracting the costs for final reports that were reported in the December 2002 reporting period, the adjusted current estimate of program acquisition costs was $1,135,595.0 million. There was a net cost increase of $111.5 million ( 0.01 percent) during the current reporting period (June 2003). This increase was due primarily to the addition of a unitary variant for Guided Multiple Launch Rocket System (GMLRS) and increased weapon support costs for the High Mobility Artillery Rocket System (HIMARS) conversion from organic to life cycle contractor support. Details of the changes for all 10 programs are shown at the top of the opposite column.

For the June 2003 reporting period, there were 10 quarterly exception SAPs submitted. The reports for Land Warrior, CVN 21, and Wideband Gapfiller Satellites reported schedule delays of six months or more. Initial reports were submitted for Future Combat Systems (FCS), AGM-88E Advanced Anti-Radiation Guided Missile, Advanced SEAL Delivery System (ASDS), and E-2 Advanced Hawkeye. Also, GMLRS, HIMARS, and B-1B Conventional Mission Upgrade Program (CMUP) rebaselined their SAR from a development estimate to a production estimate to reflect approval of recent production decisions.

Army

Future Combat Systems (FCS)--An initial SAR was submitted for FCS following approval of System Development and Demonstration (Milestone B) in May 2003.

Guided Multiple Launch Rocket System (GMLRS)--The SAR was submitted to rebaseline the program from a development estimate to a production estimate following approval of Low Rate Initial Production (Milestone C) in March 2003. Program costs increased $21.2 million ( 0.2 percent) from $11,831.9 million to $11,853.1 million, due primarily to the addition of a Unitary variant ( $315.9 million). This increase was partially offset by a reduced estimate based on a revised Army Cost Position (-$280.8 million).

High Mobility Artillery Rocket System (HIMARS)--The SAR was submitted to rebaseline the program from a development estimate to a production estimate following approval of Low Rate Initial Production (Milestone C) in March 2003. Program costs increased $78.5 million ( 1.8 percent) from $4,312.9 million to $4,391.4 million, due primarily to increased weapon support costs for the conversion from organic to life cycle contractor support.

                                             Current Estimates
                                             ($ in Millions)

December 2002 (72 programs)                  $1,129,668.4
Plus five new programs (Excalibur, GCSS           17,543.9
Army, HIMARS, Land Warrior, and SSGN)
Less final reports (ATACMS-BAT, AV-8B            -11,617.3
Remanufacture, JSIMS, SMART-T, the CVN-76
portion of the CVN68 program, and the DSUP
portion of the B-1B CMUP program)
December 2002 Adjusted (73 programs)         $1,135,595.0
Changes Since Last Report:
  Economic                                          $ 0.0
  Quantity                                            0.0
  Schedule                                            0.0
  Engineering                                       315.9
  Estimating                                       -276.9
  Other                                               0.0
  Support                                            72.5
Net Cost Change                                  $  111.5
June 2003 (73 programs)                      $1,135,706.5

Land Warrior--The SAR was submitted to report a schedule slip of 24 months (from December 2003 to December 2005) in Low Rate Initial Production (Milestone C). This delay was due to a program restructure that allows additional time for development, integration, and testing for the Land Warrior-Stryker Interoperable system. There were no cost changes reported.