DOD Has Taken Some Initial Steps to Plan for Support of BMDS, but Planning to Date Is Incomplete and Complicated by Difficulties in Transitioning Support Responsibilities to the Services

DOD has taken some initial steps to plan for BMDS support, but planning  efforts to date are incomplete. While DOD has drafted a  proposal for BMDS management that DOD officials have stated is  intended, in part, to address this issue, the draft proposal lacks important  details. DOD’s Support Planning for BMDS Has Not Followed Key Principles

DOD’s planning to support BMDS over the long term has not followed  DOD’s key principles of weapon system life-cycle management. As a result, for five of the seven  elements we examined, MDA and the services have been unable to reach  agreement on who will be responsible for providing support and how  these elements will be supported after 2013, even though MDA officials  have stated that most elements are expected to have a useful life of 20  years. Despite Recent Efforts, Operation and Support Cost Estimates for BMDS Elements Have Limitations and Are Not Transparent

DOD’s recent efforts to develop operation and support cost estimates for  BMDS elements have limitations and are not transparent for DOD and  congressional decision-makers. Although DOD has started to develop  operation and support cost estimates for BMDS elements, the estimates  are not complete and have limitations. DOD and GAO key principles for preparing cost  estimates state that complete and credible cost estimates are important to  support preparation of budget submissions over the short term as well as  to assess the long-term affordability of the program. For example, the FYDP, DOD’s 6-year spending plan,  does not fully reflect BMDS operation and support costs that are expected  to be incurred—and these are likely to be significant since operation and  support costs are typically over 70 percent of a system’s total lifetime  costs. DOD Has Not Required That Operation and Support Cost Estimates Be Developed

DOD has not yet clearly identified BMDS operation and support costs  because the department has not required that these costs be developed,  validated, and reviewed, and it has not specified when this should be done  or identified who is responsible for doing so. As a result, DOD will  have difficulty preparing credible budget requests and estimating long- term costs, which are important in assessing affordability over time. Recommendations for Executive Action

We recommend that the Secretary of Defense take the following six  actions:  To improve planning to support BMDS elements, including planning for  the transition of support responsibilities from MDA to the services, we  recommend that the Secretary of Defense direct the Under Secretary of  Defense for Acquisition, Technology, and Logistics, establish a standard  process for long-term support planning that adheres to key principles for  life-cycle management, including:    establishing timelines for planning that must be completed before each  element is fielded, such as naming a lead service, involving services in  support and transition planning, and deciding when support  responsibilities will be transitioned to the services;  requiring active lead service participation in developing long-term support  plans and designating what support planning should be completed before  elements are fielded; and    specifying which organization is responsible for life-cycle management  and identifying steps for oversight to identify who is accountable for  ensuring these actions are accomplished. To increase transparency and improve fiscal stewardship of DOD  resources for BMDS, we recommend that the Secretary of Defense direct  the Under Secretary of Defense for Acquisition, Technology, and Logistics,  to establish a requirement to estimate BMDS operation and support costs  including:    detailing when credible estimates are to be developed, updated, and  reviewed; specifying criteria for prioritizing, allocating, and distributing  funds; and clearly identifying who is responsible for oversight of this  process;  requiring periodic independent validation of operation and support costs  for each BMDS element; and    using the independently validated estimates to support preparation of  complete and credible budget submissions and DOD’s spending plan and  to assess the long-term affordability of the integrated system and  individual elements for informing key trade-off decisions. Further it is not clear when this draft proposal might be approved and  implemented. To assess the extent to which DOD has developed plans for how to  support BMDS elements over the long term, we compared the planning  that had been done with key principles embodied in DOD and Missile  Defense Agency (MDA) policies and guidance for life-cycle management  to determine what aspects may be missing or have limited service  involvement that could hinder transition of responsibility for support of  BMDS elements from MDA to the services and hinder the ability to provide  long-term support.
Why GAO Did This Study

The Department of Defense (DOD) has spent a total of over $115 billion since the mid-1980s to develop a Ballistic Missile Defense System (BMDS) comprised of land, air, and sea-based elements--such as missiles and radars--working together as an integrated system. Since the cost to operate and support a weapon system usually accounts for most of a system's lifetime costs, the resources needed to fund BMDS could be significant as DOD fields an increasing number of BMDS elements. In 2005, DOD began planning to transition responsibility for supporting BMDS elements from the Missile Defense Agency (MDA) to the services. GAO was asked to assess the extent to which DOD has (1) planned to support BMDS elements over the long-term, and (2) identified long-term operation and support costs. To do so, GAO analyzed 7 BMDS elements that will be fielded by 2015, compared DOD's plans and cost estimates to DOD and GAO key principles, and assessed the extent to which MDA and the services have agreed on responsibilities for supporting and funding BMDS elements.

What GAO Found

DOD has taken some initial steps to plan for BMDS support, but efforts to date are incomplete, and difficulties in transitioning responsibilities from MDA to the services have complicated long-term planning. DOD key principles for weapon system life-cycle management stress the importance of completing support plans that cover a system's expected useful life before it is fielded. Although MDA has developed some policies and guidance for BMDS support planning, it has not developed support plans for three of the seven elements that GAO examined, and MDA has not completed an overall support plan for the integrated system. DOD's long-term support planning for BMDS is incomplete because it has not established a standard process clearly specifying what support planning should be completed before fielding or how to transition the responsibility for supporting BMDS elements from MDA to the services. For five of the seven elements GAO examined, MDA and the services have been unable to reach agreement on who will be responsible for providing support after 2013. DOD has drafted a proposal for BMDS management that DOD officials have stated is intended, in part, to address these issues. However, the draft proposal lacks important details, and it is not clear when it is expected to be approved and implemented. Without a standardized process for long-term support planning, uncertainty will persist regarding how the elements will be supported over the long term. DOD's recent efforts to develop operation and support cost estimates for BMDS elements have limitations and are not transparent for DOD and congressional decision makers. DOD and GAO key principles for cost estimating state that complete, credible, and independently verified cost estimates are important to support preparation of budget submissions over the short term as well as for assessing the long-term affordability of a program. DOD has started to develop operation and support cost estimates for the seven elements GAO examined, but those efforts are not yet complete and have limitations. First, the estimates are likely to change since DOD is still determining key assumptions. Second, DOD does not plan to have the estimates independently verified. Furthermore, the Future Years Defense Program, DOD's 6-year spending plan, does not fully reflect BMDS operation and support costs. DOD has not yet clearly identified BMDS operation and support costs because the department has not required that these costs are to be developed, validated, and reviewed, and it has not specified when this should be done or who is responsible for doing so. Although DOD's draft proposal for managing BMDS contains some funding suggestions, it does not address the operation and support cost limitations GAO identified. Without a requirement to develop and validate BMDS operation and support cost estimates, DOD will have difficulty preparing credible budget requests and assessing the affordability of BMDS over the long term.