BMDS Flight Tests Successfully Executed, but Development Challenges Continue

In fiscal year 2013, MDA successfully executed several flight tests that  demonstrated key BMDS capabilities and modifications made to resolve  prior development issues, but continued to experience failures and delays  resulting in less testing and production than planned. For the first time in  September 2013, the Aegis BMD and Terminal High Altitude Area  Defense (THAAD) programs participated in an operational flight test that  resulted in a near simultaneous engagement. Additionally, the Aegis BMD  program also successfully conducted flight tests with the SM-3 Block IB  missile. Lastly, GMD also successfully conducted a  non-intercept test of its upgraded interceptor that is currently in  development, but experienced an intercept test failure of the fielded  interceptor, the cause of which is still unknown. This is a significant  achievement because it is the first operational test that involved multiple  elements working simultaneously. If design changes are  necessary, program documentation indicates that they will not be flight  tested until the fourth quarter of fiscal year 2015, just prior to the planned  deployment of the SM-3 Block IB to support the regional defense of  Europe and 6 months after its planned full production decision. MDA Made Its Resource and Schedule Baselines Clearer, but Further Actions Needed to Enhance Their Use for Oversight

MDA has taken some steps to improve the clarity of its resource and  schedule baselines, but issues with the content and presentation of these  baselines continue to limit the usefulness of the information available to  decision makers for oversight of BMDS development efforts. Assessing MDA’s progress in achieving its schedule goals is also  difficult because MDA’s schedule baselines are not presented in a way  that allows decision makers to understand or easily monitor progress. Until MDA improves the quality and comprehensiveness of its cost  estimates and the clarity of its schedule information, its baselines may not  be useful for decision makers. Additionally, MDA has made little progress improving the  comprehensiveness of the cost estimates that support its resource  baselines. Because MDA already reports the estimated  acquisition costs and some of the operation and support costs for the  acquisitions in the annual BAR, we concluded that annual document to be  the most appropriate way to report the full costs to Congress. In the National Defense Authorization Act for Fiscal Year 2014, Congress  took steps to address concerns over MDA’s cost estimates by requiring  MDA to report to the congressional defense committees on its efforts to  improve the quality of the cost estimates included in its acquisition    For example, the act requires MDA to report on a description  baselines.of and schedule for planned actions to improve its cost estimates, as well  as an assessment of how the planned improvements align with GAO’s  cost estimating best practices. MDA’s 2013 BAR schedule  baselines include numerous events but provide very little information  about them, making it difficult to understand what the events are and why  they are important. In addition, MDA does not present any comparisons of event dates with  previously reported dates. Until MDA improves the  content of its schedule baselines, decision makers will not be able to  assess how a program is performing over time. To demonstrate the CE-I’s effectiveness against a longer range target  in more challenging conditions and to confirm the design changes  implemented to improve performance, as well as any changes needed  to resolve the July 2013 CE-I flight test failure work as intended, we  recommend that the Secretary of Defense direct MDA’s Director to  conduct a flight test of the CE-I interceptor once the cause of the  failure has been determined and any mitigations have been  developed. DOD partially concurred with our first recommendation, non-concurred  with our second recommendation and concurred with our third  recommendation. Appendix I: Objectives, Scope, and Methodology

To assess the Missile Defense Agency’s (MDA) progress and any  challenges associated with developing, testing, and producing the ballistic  missile defense system (BMDS) during fiscal year 2013, we examined the  acquisition accomplishments of several missile defense elements and  MDA’s targets program. Specifically, we reviewed the Aegis Ballistic  Missile Defense (Aegis BMD) with Standard Missile-3 (SM-3) Block IB;  Aegis Ashore; Aegis Modernized Weapon System Software; Army/Navy  Transportable Radar Surveillance and Control Model 2 (AN/TPY-2);  Command, Control, Battle Management, and Communications (C2BMC);  Ground-based Midcourse Defense (GMD) System; Targets and  Countermeasures; and Terminal High Altitude Area Defense (THAAD)  elements because, as reported in the 2013 BMDS Accountability Report  (BAR), these elements or programs have entered MDA’s product  development, initial production, or production acquisition phase, but are  not yet mature enough to be transferred to a military service and enter the   We  formal DOD acquisition cycle for full-rate production and deployment.reviewed key management documents for fiscal year 2013 including  Program and Baseline Execution Reviews, which detailed program  accomplishments and areas of concerns, and interviewed program  element officials.
Why GAO Did This Study

Since 2002, MDA has spent approximately $98 billion and has requested $38 billion more through fiscal year 2018 to develop, test, and field a system to defend against enemy ballistic missiles. The BMDS is comprised of a command and control system, sensors that identify incoming threats, and intercepting missiles. GAO is mandated by law to assess the extent to which MDA has achieved its acquisition goals and objectives, as reported to Congress through its acquisition baselines, and to report on other issues as appropriate. This report examines the agency's progress and any challenges in fiscal year 2013 associated with (1) developing, flight testing, and producing individual systems, which MDA refers to as BMDS elements; and (2) reporting resource and schedule baselines that support oversight. To support this effort, GAO examined MDA's acquisition and test reports, analyzed two of MDA's acquisition baselines—resource and schedule—to discern progress, and interviewed a wide range of DOD and contractor officials.

What GAO Found

In fiscal year 2013, the Missile Defense Agency (MDA) made mixed progress in achieving its acquisition goals to develop, test, and produce elements of the Ballistic Missile Defense System (BMDS). For the first time, MDA conducted an operational flight test that involved warfighters from several combatant commands using multiple BMDS elements simultaneously. The agency also successfully conducted several developmental flight tests that demonstrated key capabilities and modifications made to resolve prior production issues. However, the Aegis BMD and Ground-based Midcourse Defense (GMD) continued to experience testing and development challenges.
Aegis BMD—while the program successfully conducted three intercept flight tests with the Standard Missile (SM)-3 Block IB missile in support of a full production decision planned for fiscal year 2015, a missile failed during one of these tests. Although the cause of failure is not known, the program plans to move forward with missile production in 2014. The program is also determining whether a key component that is common with the already fielded SM-3 Block IA missile will need to be redesigned.
GMD—although the program successfully conducted a non-intercept flight test of its upgraded interceptor, the program is nearing a seven year delay in completing its first successful intercept. Until this upgraded interceptor is demonstrated in an intercept test, expected to be conducted in the third quarter of fiscal year 2014, manufacturing and deliveries remain on hold. In July 2013, the GMD program also failed a flight test of its fielded interceptor. This flight test was designed to assess the fielded interceptor under more challenging conditions and to confirm design changes to resolve prior issues. MDA has not yet made a decision on how to proceed since the cause of failure has not been determined.
MDA has improved the clarity of its resource and schedule baselines since it first submitted them to Congress in 2010. However, issues with the content and presentation of these baselines continue to limit the usefulness of the information available to decision makers for oversight. First, as the agency is still in the process of improving the quality and comprehensiveness of the cost estimates that support its resource baselines, for the fourth year, GAO has found that MDA's cost estimates are unreliable. For example, MDA's 2013 cost estimates still do not include operations and support costs for military services which may significantly understate total costs. Congress has recently required MDA to include these costs in future acquisition baselines which may improve transparency. Second, MDA's schedule baselines are presented in a way that makes it difficult to assess progress. Specifically, MDA's 2013 schedule baselines include numerous events but provide very little information about them, making it difficult to understand what the events are and why they are important. Additionally, the 2013 schedule baselines do not compare the current event dates with previously reported dates, so decision makers cannot easily assess how the program is performing over time. Until MDA improves the quality and comprehensiveness of its cost estimates and the content of its schedule information, its baselines will not be useful for decision makers to gauge progress.

What GAO Recommends

GAO recommends (1) any changes to the SM-3 Block IB be flight tested before DOD approves full production; (2) retest the fielded GMD interceptor to demonstrate performance; and (3) improve the content of its schedule baselines. DOD partially concurred with the first, non-concurred with the second, and concurred with the third, stating that the production and testing decisions will be made using the proper DOD processes. GAO believes both recommendations are valid as discussed in this report.