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NASA Receives $1B In Stimulus Funding

March 5, 2009

NASA can land a spacecraft on a peanut-shaped asteroid 150 million miles away, but can’t even come close to hitting its own budget goals for building a spacecraft, joked congressional auditors as they reported that the space agency is nearly $1.1 billion in the red on just nine projects over the last couple of years.

It’s a joke NASA’s top officials understand all too well.

The Government Accountability Office (GAO), the financial watchdog of the U.S. Congress, reviewed NASA’s newest large-scale projects and found most were either late, over budget or both, and that’s after excluding two of the agency’s largest spending projects “” replacing the space shuttle fleet and the Hubble Space Telescope “” whose costs still aren’t definite.

Cost overruns have historically caused NASA, which has an annual budget of about $18 billion, to run low on money, forcing it to abandon or delay other projects.  Many times it simply requests additional funding from taxpayers.  One cast in point: NASA will receive $1 billion from the new economic stimulus package for climate-watching satellites, exploration and other projects.

“Getting an extra infusion of money doesn’t necessarily mean you have a capability to spend it well,” Cristina Chaplain, the GAO’s acquisitions chief who authored the report, told the AP.

A separate GAO report cited NASA as a prime example for poor practices in estimating costs. The agency needs “a more disciplined approach”, to its projects, the GAO said.

The space agency’s spending has been on the GAO’s “high risk” list since 1990. And NASA’s struggles with cost overruns will be the topic at an upcoming House Science Committee hearing this Thursday.

“A cancer is overtaking our space agency: the routine acquiescence to immense cost increases in projects,”  wrote Alan Stern, NASA’s former science chief, in an opinion piece last year in the New York Times.

Stern quit his post last year over the shifting of money to fund cost overruns.

NASA’s spending problems are notoriously predictable and large, so much so that Congress put the agency under the same tough budgeting rules as the Defense Department two years ago.  These rules require NASA to notify Congress if a program’s cost rises by more than 15 percent. 

Monday’s GAO report was the first time the new rules were used with NASA.

For its part, NASA told the Associated Press that its missions “are one-of-a-kind and complex, which always makes estimating challenging. We do believe NASA is a good investment of federal funds and strive to provide the best value.”

External forces, including launch availabilities, are also responsible delays and cost overruns, the agency added. 

Nevertheless, NASA maintains that it has improved its cost estimating abilities.

Last December Michael Griffin, NASA’s administrator at the time, tried to compare cost overruns, such as the extra $400 million required for the Mars Science Laboratory, with do-it-yourself home projects that keep requiring extra visits to the hardware store.

When a reporter objected that a do-it-yourself project uses one’s own money, Griffin said: “And we are spending your own money for this,” a response that drew laughter from reporters.

Financial discipline “is an uphill fight”, according to Smithsonian Institution space scholar John Logsdon, a member of NASA’s advisory council.

For the latest report, NASA was unable to provide the GAO with current accurate estimates on two of its largest projects, forcing the GAO to cite ballpark guesses that NASA’s program to build new lunar spaceships would cost between $37 to $49 billion.  The project is already rife with technical and financial risks, the GAO said.

The multibillion-dollar James Webb Space Telescope, whose current cost is not known, already exceeded by $1 billion estimates compiled three years ago, before NASA fell under its new cost accounting methods.

Chaplain said the space agency has cost overruns for a variety of reasons, including poor cost estimating at the initial phases of a project, trying to conduct cutting-edge science, continuously changing designs and poor contractor performance.

Indeed, six of NASA’s projects experienced problems with contractors, including lack of experience, which led to delays or added costs.

At his December news conference, Griffin said there isn’t an ideal way to estimate at a mission’s outset what precisely is needed to attain scientific priorities.

Griffin, whose replacement has not yet been named, said NASA’s scientists have a tendency to downplay costs early on in a project to convince the agency that their initiative is lower-cost than someone else’s.  It’s only later, after NASA commits to the projects and funds begin to flow,  that additional money is needed.

Ultimately, NASA typically spends the additional money rather than cancel the project.

And while it’s a problem everyone accepts, they shouldn’t, said Chaplain.

The Mars Science Laboratory, which has exploded to a $2.3 billion price tag, provides a good example of NASA’s methods.  In 2003, its cost was estimated at $650 million on the National Academy of Sciences wish list, which NASA used to establish priorities.

However, Doug McCuistion, head of NASA’s Mars exploration program, said on Tuesday that the proper estimate to begin with was actually $1.4 billion, rather than $650 million, because it was not an official NASA projection.  By last December the figure had grown to $1.9 billion, and launch plans were ultimately delayed from this year to 2011 amid technical problems.

The extra funding came from reductions to other projects.

“The costs of badly run NASA projects are paid for with cutbacks or delays in NASA projects that didn’t go over budget,” Stern wrote.

“Hence the guilty are rewarded and the innocent are punished.”

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