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Biting Memo Details Intel, DoD Satellite Feud

A multi-billion dollar program known as BASIC is the flashpoint in the battle for acquisition supremacy between the Defense Department and the intelligence community.

In a remarkably frank and biting Aug. 15 memo, the head of Pentagon acquisition, John Young, rejects plans by the Office of the Director of National Intelligence to approve purchase of the Broad Area Satellite Imagery Collection program. It would include one satellite, with an option for a second satellite. Parellel to the program is authority and money to buy up to $1.5 billion in satellite imagery over the next six years.

The three-page memo details just what is wrong, in Young's eyes, with the approach of the Office of Director of National Intelligence (ODNI).

"The BASIC program could be underway if every decision was not constantly being re-litigated and if key stakeholders would collaboratively work the issues," wrote Young, undersecretary of Defense for acquisition, technology and logistics.

A congressional aide familiar with the program was exasperated. "The thing that has slowed everything down is this conflict between ODNI and ATL, so it's hard for them to blame anyone but themselves," the aide said. The delays in approving the program are especially ironic since both the intelligence community and the Pentagon have said repeatedly that they must approve this program as quickly as possible. They have not spoken publicly about the cause of the need for speed, but several sources have said the country faces a possible imagery gap as National Reconnaissance Office satellites age and eventually fail.

"I've been told for a year now that this was schedule driven but now they come out with this," the congressional aide said.

Perhaps the most central issue - who controls the program -- is addressed head on. Young says that the space elements of BASIC "will be fully funded within the DoD budget." That means his office is "fully accountable for the contract and expenditure of these funds." But a memo from the ODNI proposes splitting the acquisition authority. Young, in classic Pentagon language, "non-concurs" with this. DoDBuzz has not seen the ODNI memo but it is referred to Young's memo.

Young says the two offices, who work together on a range of classified satellite and other acquisition projects, "should clearly document the requirements associated with the government purchase and operation of two satellites." Experts have repeatedly criticized both the intelligence community and the Pentagon for doing a poor job of writing and limiting requirements. Young's memo makes clear that the intelligence side at least had not yet detailed its requirements. So-called requirements creep is one of the main causes of cost increases and schedule delays.

Young says that the ODNI also goofed on another basic issue. The ODNI memo "provides woefully insufficient time to coordinate, allocating only one half business day on an issue which is complex, is interagency, and has been presented at separate times to the Deputies and Principals of the respective organizations to make decisions." Interagency issues are notoriously difficult to resolve, involving as they do deep-seated cultural issues and questions of fiscal and operational control.

A former senior intelligence official sided with Young on the memo. The former official, who had already seen the memo, said that "John Young is objecting (quite properly in my view) and demonstrating that there are numerous issues yet to be resolved.  What's particularly interesting is that he seems to be reopening some issues that had previously appeared to be closed."

That is a reference to a remarkable memo signed March 21 by Defense Secretary Robert Gates and Director of National Intelligence Mike McConnell agreeing that the DNI would have acquisition authority over any program that received 51 percent of its funding from the intelligence community's National Intelligence Program pool. Previously, the Defense Department exercised acquisition power if even one dollar of its money funded an intelligence system. The two sides also agreed that programs receiving a majority of funding from the Military Intelligence Program pool would be run by the Pentagon but the DNI would have a seat on the body overseeing Pentagon buys known as the Defense Acquisition Board.

The fissure between the two sides over authority was summarized by the congressional aide: "A couple of months ago there seemed to be this move to joint decisions. Now they seem to be going the other way." The aide predicted that Gates and McConnell would have to meet to resolve the impasse. That elicited some frustration that two senior administration officials would have to take time out from running the wars in Iraq and Afghanistan, as well as overseeing global intelligence operations, to settle what amounts to a really nasty food fight between two bureaucracies. "I just think this is getting out of hand," the aide said.

The battle over BASIC first burst into public view last March when I broke the story that McConnell and Gates had agreed to strip the National Reconnaissance Office, builder and operator of the nation's spy satellites, of its authority to make acquisition milestone decisions about BASIC. That decision occurred in part because the NRO looked likely to contradict administration policy that the military and intelligence community rely whenever possible on commercial satellites for satellite imagery.

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