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IMMEDIATE RELEASE

Release No: 604-03
August 15, 2003

Department of Defense Releases Selected Acquisition Reports

         The Department of Defense has released details on major defense acquisition program cost and schedule changes since the December 2002 reporting period.  This information is based on the Selected Acquisition Reports (SARs) submitted to the Congress for the June 30, 2003, reporting period.

         SARs summarize the latest estimates of cost, schedule and technical status.  These reports are prepared annually in conjunction with the president's budget.  Subsequent quarterly exception reports are required only for those programs experiencing unit cost increases of at least 15 percent or schedule delays of at least six months.  Quarterly SARs are also submitted for initial reports, final reports and for programs that are rebaselined at major milestone decisions.

 

         The total program cost estimates provided in the SARs include research and development, procurement, military construction, and acquisition-related operation and maintenance (except for pre-Milestone B programs which are limited to development costs pursuant to 10 USC §2432).  Total program costs reflect actual costs to date as well as future anticipated costs.  All estimates include anticipated inflation allowances.

 

         The current estimate of program acquisition costs for programs covered by SARs for the prior reporting period (December 2002) was $1,129,668.4 million.  After adding the costs for new programs that were reported in the December 2002 reporting period (listed below) and subtracting the costs for final reports that were reported in the December 2002 reporting period (listed below), the adjusted current estimate of program acquisition costs was $1,135,595.0 million.  There was a net cost increase of $111.5 million (+0.01 percent) during the current reporting period (June 2003).  This increase was due primarily to the addition of a unitary variant for GMLRS and increased weapon support costs for the HIMARS conversion from organic to life cycle contractor support.  Details of the changes for all ten programs are as follows:

 

Current Estimate

($ in Millions)

December 2002 (72 programs)

$ 1,129,668.4

Plus five new programs (Excalibur, GCSS Army, HIMARS,

Land Warior, and SSGN)

  +17,543.9

Less final reports (ATACMS-BAT, AV-8B Remanufacture, JSIMS, SMART-T, the CVN-76 portion of the CVN 68 program, and the DSUP portion of the B-1B CMUP program)

-11,617.3

 

December 2002 Adjusted (73 programs)

$ 1,135,595.0

 

Changes Since Last Report:

 

Economic

$      0.0

Quantity

0.0

Schedule

0.0

Engineering

+315.9

Estimating

-276.9

Other

0.0

Support

+72.5

Net Cost Change

$ +111.5

June 2003  (73 programs)

$ 1,135,706.5

 

For the June 2003 reporting period, there were 10 quarterly exception SARs submitted.  The reports for Land Warrior, CVN 21, and Wideband Gapfiller Satellites reported schedule delays of six months or more.  Initial reports were submitted for Future Combat Systems (FCS), AGM-88E Advanced Anti-Radiation Guided Missile, Advanced SEAL Delivery System (ASDS), and E-2 Advanced Hawkeye.  Also, Guided Multiple Launch Rocket System (GMLRS), High Mobility Artillery Rocket System (HIMARS), and B-1B Conventional Mission Upgrade Program (CMUP) rebaselined their SAR from a development estimate to a production estimate to reflect approval of recent production decisions.

 

Army:

Future Combat Systems (FCS) - An initial SAR was submitted for FCS following approval of System Development and Demonstration (Milestone B) in May 2003.

 

Guided Multiple Launch Rocket System (GMLRS) - The SAR was submitted to rebaseline the program from a development estimate to a production estimate following approval of Low Rate Initial Production (Milestone C) in March 2003.  Program costs increased $21.2 million (+0.2 percent) from $11,831.9 million to $11,853.1 million, due primarily to the addition of a Unitary variant (+$315.9 million).  This increase was partially offset by a reduced estimate based on a revised Army Cost Position (-$280.8 million).

 

High Mobility Artillery Rocket System (HIMARS) - The SAR was submitted to rebaseline the program from a development estimate to a production estimate following approval of Low Rate Initial Production (Milestone C) in March 2003.  Program costs increased $78.5 million (+1.8 percent) from $4,312.9 million to $4,391.4 million, due primarily to increased weapon support costs for the conversion from organic to life cycle contractor support.

 

Land Warrior - The SAR was submitted to report a schedule slip of 24 months (from December 2003 to December 2005) in Low Rate Initial Production (Milestone C).  This delay was due to a program restructure that allows additional time for development, integration, and testing for the Land Warrior-Stryker Interoperable system.  There were no cost changes reported.

 

Navy:

AGM-88E Advanced Anti-Radiation Guided Missile - An initial SAR was submitted for AGM-88E following approval of System Development and Demonstration (Milestone B) in June 2003.

 

Advanced SEAL Delivery System (ASDS) - An initial SAR was submitted for ASDS following designation as a Major Defense Acquisition Program (MDAP) in April 2003.

 

CVN 21 - The SAR was submitted to report schedule slips of more than six months to the Early Operational Assessment (EOA) (from June 2003 to March 2004) and to Milestone II (from June 2003 to April 2004).  These delays resulted from the restructure of the CVN 21 program (previously CVNX) that pulled forward technologies originally planned for CVNX 2.  EOA and Milestone II were delayed to allow adequate time to update the Operational Requirements Document (ORD) and the Independent Cost Estimate (ICE).  Other program milestones such as construction contract award in FY 2007 and ship delivery in FY 2014 remain unchanged.

 

E-2 Advanced Hawkeye - An initial SAR was submitted for E-2 Advanced Hawkeye following approval of System Development and Demonstration (Milestone B) in June 2003.

 

Air Force:

B-1B Conventional Mission Upgrade Program (CMUP) - The SAR was submitted to rebaseline the program from a development estimate to a production estimate following approval of Full Rate Production for the Computer Upgrade in April 2003.  Program costs increased $11.8 million (+1.8 percent) from $663.6 million to $675.4 million, due primarily to a revision in the Program Office estimate.

 

Wideband Gapfiller Satellites - The SAR was submitted to report schedule slips to the Initial Operational Capability, from June 2005 to April 2006, and to Full Operational Capability, from June 2006 to February 2007, due primarily to manufacturing difficulties by the contractor.  There were no cost changes reported.

 

New SARs

(As of June 30, 2003)

           The Department of Defense has submitted initial SARs for Future Combat Systems (FCS), AGM-88E Advanced Anti-Radiation Guided Missile, Advanced SEAL Delivery System (ASDS), and E-2 Advanced Hawkeye.  These reports do not represent cost growth.  Baselines established on these programs will be the point from which future changes will be measured.  The current cost estimates are provided below:

    

 

Program

 

Current Estimate

($ in Millions)

 

Future Combat Systems (FCS)

 

$ 92,200.0

 

AGM-88E Advanced Anti-Radiation Guided Missile

 

1,510.9

 

Advanced SEAL Delivery System (ASDS)

 

1,969.3

 

E-2 Advanced Hawkeye

 

14,979.6

 

 

Total

$ 110,659.8

 

            More information on the SARs program can be found by clicking here.