UCLASS Program Has Been Delayed As Requirements Debate Continues

Since our last review in September 2013, the system’s intended mission  and required capabilities have come into question, delaying the Navy’s  UCLASS schedule. In addition the Navy now expects to achieve early operational  capability—a UCLASS system on at least one aircraft carrier—no earlier  than fiscal year 2022, a delay of around 2 years. Congress, DOD, and the Navy continue to debate the primary role of the  UCLASS system. The main options are a largely surveillance role with  limited strike operating in less contested environments, or a largely strike  role with limited surveillance operating in highly contested environments. Knowledge about Needed Resources Depends on Final UCLASS Requirements

The resolution of the debate over UCLASS requirements could have  significant design and cost implications, which will determine the  resources the Navy needs and how much knowledge from the Navy’s  previous assessments and estimates can still be applied. In September  2013, we concluded that the UCLASS program should demonstrate that it  has an executable business case that reflects high levels of knowledge  and a match between requirements and available resources before  holding a Milestone B review, establishing an acquisition program  baseline, and initiating system development. When the match  occurs before system development begins, the weapon system is more  likely to meet objectives. As such, the Navy  would need to revisit its understanding of available resources in the areas  of design knowledge, funding, and technologies as detailed below:
Knowledge gained through preliminary design reviews may no  longer be applicable: During the four preliminary design reviews that  ended in May 2014, the Navy evaluated contractor designs against a  set of performance specifications issued in July 2013. Despite this near term reduction, annual development funding levels  are projected to reach nearly $850 million in fiscal year 2020, as  shown in figure 2. Recommendation for Executive Action

Once the JROC has validated UCLASS requirements, and in order to  ensure that the Navy has a sound and executable business case and  establishes an acquisition program baseline before awarding a  development contract and committing significant resources, we  recommend that the Secretary of Defense direct the Secretary of the  Navy to provide a report to the congressional defense committees and  the Secretary of Defense demonstrating that the Navy has the resources  available and a strategy to deliver those required UCLASS capabilities. On behalf of  DOD, the Navy partially agreed with our recommendation. If the Navy holds a Milestone B review before awarding the development  contract for the UCLASS air system and receives the certifications  required by statute and DOD policy at that point in time, as well as  meeting the reporting requirements in the National Defense Authorization  Act for Fiscal Year 2015, we agree that it will satisfy the basic intent of our  recommendation, and thus no separate report would be required. However, the current UCLASS schedule does not include a Milestone B  review prior to the air system development contract award.
Why GAO Did This Study

The Navy expects to have invested at least $3 billion through fiscal year 2020 in the development of the UCLASS system, which includes air system, aircraft carrier, and control system and connectivity segments. It is expected to enhance the intelligence, surveillance, reconnaissance, targeting, and strike capabilities of the Navy's aircraft carrier fleet. In August 2013, the Navy awarded contracts worth $15 million each to four competing contractors to develop and deliver preliminary designs for the air system, which were assessed by the Navy in May 2014. The next anticipated steps for the program will be to solicit proposals and award the contract for air system development.
The National Defense Authorization Act for Fiscal Year 2014 included a provision that GAO review the status of the UCLASS acquisition program annually. This report assesses (1) the current status of the program, and (2) the extent to which the Navy has the knowledge about resources it needs to develop the UCLASS system. GAO applied best practice standards, analyzed program documentation, and interviewed Department of Defense (DOD) and contractor officials.

What GAO Found

Since our last review in September 2013, the intended mission and required capabilities of the Navy's Unmanned Carrier-Launched Airborne Surveillance and Strike (UCLASS) system have come into question. Ongoing debate about whether the primary role of the UCLASS system should be mainly surveillance with limited strike or mainly strike with limited surveillance has delayed the program, as shown in the figure. Requirements emphasizing a strike role with limited surveillance could be more demanding and costly.
a Early operational capability is currently not anticipated before fiscal year 2022 and could occur as late as fiscal year 2023.
The knowledge the Navy has obtained about the resources needed to develop the UCLASS system may no longer be applicable depending on what requirements are finally chosen. GAO's prior best practices work has found that before initiating system development, a program should present an executable business case that demonstrates that it has a high level of knowledge and a match between requirements and available resources. If the final UCLASS requirements emphasize a strike role with limited surveillance, the Navy will likely need to revisit its understanding of available resources in the areas of design knowledge, funding, and technologies before awarding an air system development contract.

What GAO Recommends

GAO recommends that before committing significant resources the Navy should ensure that it has an executable business case for UCLASS development that matches available resources to required capabilities. On behalf of DOD, the Navy generally agreed with the recommendation.