NASA estimates that the planned $2.8-billion reduction in the current replacement value of facilities will yield only about $250 million in cost reductions through fiscal year 2000. Problems in Evaluating Cost-Reduction Opportunities

NASA has had problems in identifying, assessing, or implementing some cost-reduction opportunities. NASA personnel (1) did not thoroughly evaluate potential larger cost-reduction options, (2) limited the scope of consideration for consolidation, (3) performed questionable initial cost-reduction studies, (4) made inappropriate closure recommendations, and (5) substantially overstated cost-reduction estimates. In March 1995, NASA began studying ways to cut its supercomputer costs by consolidating their management and operation. Environmental Cleanup Costs Could Affect Facility Disposition Efforts

NASA’s future facility disposition decisions could be affected by environmental cleanup costs. However, NASA officials do not yet fully know what the cleanup requirements will be and lack a policy for identifying other responsible parties and sharing cleanup costs. Both teams did, however, identify barriers to increased cooperation and coordination between NASA and DOD, including differences in cost accounting systems, practices, and standards. Thus, NASA intends to start planning a reduction-in-force during fiscal year 1998, if enough NASA employees do not retire or resign voluntarily. NASA’s ability to reach its workforce reduction goal by the turn of the century is subject to major uncertainties, including the shifting of program management from headquarters to field centers and the award of a single prime contract for managing the space shuttle at Kennedy Space Center.
Why GAO Did This Study

Pursuant to a congressional request, GAO reviewed the status of the National Aeronautics and Space Administration's (NASA) efforts to achieve reductions and efficiencies in key areas of its infrastructure.

What GAO Found

GAO found that: (1) NASA plans for a $2.8-billion reduction in the current replacement value of its facilities will yield only about $250 million in cost reductions through fiscal year (FY) 2000; (2) NASA has experienced problems in assessing cost-reduction opportunities because it did not thoroughly evaluate cost-reduction options, excluded many systems in its review of ways to cut supercomputer costs, performed questionable initial studies for aircraft consolidation, made inappropriate closure recommendations, and overstated cost-reduction estimates; (3) although environmental cleanup costs could affect facility disposition efforts, NASA lacks a policy for identifying other responsible parties and sharing cleanup costs; (4) a joint effort between NASA and the Department of Defense to study potential operation cost reductions through increased cooperation and sharing yielded no specific recommendations for closures, consolidations, or cost reductions but did identify barriers to sharing and increasing interagency reliance; and (5) NASA ability to reach its workforce reduction goal by 2000 is subject to some major uncertainties, and NASA may need to plan a reduction in force if enough employees do not retire or resign voluntarily.