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Space 'Poster Child' For Cost Increases


ORLANDO--Tougher contracts, less ambitious and more flexible requirements must be pursued if the Air Force and the US military are to get the space systems they need, says the head of Air Force Space Command.

"We have to get control of the cost of space programs. We've become the poster child for things that are late and expensive. We've got to develop better requirements and trade requirements. We've got to be willing to say good enough is good enough," Gen. William Shelton said in a presentation to the Air Force Association conference. How to do that? "If it's good enough to win, we need to build good enough to win... We've got to write better contracts contracts that hold contractors accountable."

One of the poster children for better contracts is the Advanced Extremely High Frequency communications satellite that has been ever so slowly climbing into orbit recently. While Shelton made it clear he thinks that the spacecraft will make it to orbit, it will have cost the American taxpayer a considerable amount of cash. Reports indicate that the problem lies in a fuel line that was not correctly cleared before launch. So fuel is not making it to the spacecraft's engines. Shelton would not confirm the cause but did say it "was a quality issue." The Air Force is in negotiations with AEFH builder Lockheed Martin to recoup much of the "considerable cost" of the technical teams that have struggled to come up with ways to get the spacecraft to orbit and ensure its service life does not shorten. Shelton said he believed the AEHF bird would make it to orbit and would remain operational as long as previously planned. But the Air Force has incurred the opportunity costs due to the late arrival on orbit, plus the cost of the technical teams, Shelton said.

To ensure contractors are held responsible in future he wants contracts to be rewritten so they are much clearer about who is liable for what when problems occur once the satellite leaves the ground.

In addition to his worries about contracts, costs and requirements, Shelton said he is closely watching the space industrial base, especially in light of Ash Carter's recent comments about encouraging mergers among the second and third tier companies.

"Most of my concern is at the sub level," he said, noting some smaller companies "have been driven out of business" due to lack of consistent work. The areas he is watching most closely: solid rocket motors and makers of electronic parts, especially those involving radiation hardening.

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