NASA SLS Cost Exceeds Congressional Agency Baseline Commitment

NASA OIG: NASA'S Management of Space Launch System Program Costs and Contracts, OIG

"NASA continues to struggle managing SLS Program costs and schedule as the launch date for the first integrated SLS/Orion mission slips further. Rising costs and delays can be attributed to challenges with program management, technical issues, and contractor performance. For example, the structure of the SLS contracts limits visibility into contract costs and prevents NASA from determining precise costs per element. Specifically, rather than using separate contract line item numbers (CLIN) for each element's contract deliverables, each of the contracts have used a single CLIN to track all deliverables making it difficult for the Agency to determine if the contractor is meeting cost and schedule commitments for each deliverable. Moreover, as NASA and the contractors attempt to accelerate the production of the SLS Core Stages to meet aggressive timelines, they must also address concerns about shortcomings in quality control.

Based on our review of SLS Program cost reporting, we found that the Program exceeded its Agency Baseline Commitment (ABC)--that is, the cost and schedule baselines committed to Congress against which a program is measured--by at least 33 percent at the end of fiscal year 2019, a figure that could reach 43 percent or higher if additional delays push the launch date for Artemis I beyond November 2020. This is due to cost increases tied to development of Artemis I and a December 2017 replan that removed almost $1 billion of costs from the Program's ABC without lowering the baseline, thereby masking the impact of Artemis I's projected 19-month schedule delay from November 2018 to June 2020. Since the replan, the SLS Program now projects the Artemis I launch will be delayed to at least spring 2021 or later. Further, we found NASA's ABC cost reporting only tracks Artemis I-related activities and not total SLS Program costs. Overall, by the end of fiscal year 2020, NASA will have spent more than $17 billion on the SLS Program--including almost $6 billion not tracked or reported as part of the ABC."

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