An Explosion of Cost in SARs

In case you all didn't catch this, the Pentagon released its latest Selected Acquisition Report data on pricey defense programs that are likely to bust costs.arh.jpg

You'll find some likely suspects on the list, including the much-maligned Armed Reconnaissance Helicopter, Excalibur shell, the EA-18G Growler and the ever-struggling WIN-T.

Take a look:

ARH (Armed Reconnaissance Helicopter) The SAR was submitted to report a unit cost increase of approximately 20% higher than the current baseline estimate, which resulted in a significant Nunn-McCurdy breach. Program costs increased $1,009.1 million (+18.7%) from $5,390.2 million to $6,399.3 million, due primarily to an increase in airframe manufacturing labor and material costs (+$345.5 million), higher System Development and Demonstration (SDD) costs (+$290.9 million), and implementation of an upgrade to the main rotor system (+205.5 million).

Excalibur The SAR was submitted to rebaseline the report from a Development to a Production estimate following approval of Low Rate Initial Production (Milestone C) for the Increment Ia-2 in July 2007. Program costs increased $161.6 million (+7.0%) from $2,302.8 million to $2,464.4 million, due primarily to additional funding to support a higher Army Cost Position for the revised Acquisition Program Baseline approved at Milestone C.

WIN-T (Warfighter Information Network-Tactical) Increment 1 This is the initial SAR for WIN-T Increment 1 program. Following a Nunn-McCurdy breach certification in June 2007 that restructured the original WIN-T program, the WIN-T Increment 1 program (formerly Joint Network Node (JNN)) was initiated in October 2007.

Warfighter Information Network-Tactical (WIN-T) Increment 2 This is the initial SAR for the WIN-T Increment 2 program. Following a Nunn-McCurdy breach certification in June 2007 that restructured the original WIN-T program, the WIN-T Increment 2 program (Initial Networking on the Move) was initiated in October 2007.

EA-18G The SAR was submitted to rebaseline the report from a Development to a Production estimate following approval of Low Rate Initial Production (Milestone C) in July 2007. Program costs increased $321.5 million (+3.8%) from $8,368.0 million to $8,689.5 million, due primarily to a quantity increase of five aircraft from 80 to 85 aircraft.

RMS (Remote Minehunting System) The SAR was submitted to report schedule delays of more than six months. That is, Operational Evaluation (OPEVAL) slipped 15 months from June 2007 to September 2008, because the only Navy platform capable of performing RMS OPEVAL (DDG-96) is unavailable due to the ships deployment schedule. There were no cost changes reported.

C-5 RERP (Reliability Enhancement and Reengining Program) The SAR was submitted to report a unit cost increase of more than 25% to the current baseline estimate and more than 50% to the original baseline, which resulted in a critical Nunn-McCurdy breach. Program costs increased $6,168.3 million (+54.4%) from $11,337.9 million to $17,506.2 million, due primarily to a revised program estimate based on an analysis of prime contractor production proposal data, System Development and Demonstration (SDD) actuals, and commercial pricing data.

EELV (Evolved Expendable Launch Vehicle) This will be the final SAR submission for the EELV program, because the Under Secretary of Defense for Acquisition, Technology, and Logistics placed the program into sustainment and removed it from the active Major Defense Acquisition Program (MDAP) list. There were no cost changes reported.

MPS (Mission Planning System) The SAR was submitted to report schedule delays of more than six months. Specifically, the start of System Development and Demonstration (SDD) (Milestone B) for Increment IV slipped 10 months from February 2006 to December 2007. Program costs decreased $7.0 million (-0.4%) from $1,589.5 million to $1,582.5 million, due primarily to a revised estimate to complete development.

(Gouge: NC)

-- Christian

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