Cost/Benefit Analysis--A Legislative Branch Viewpoint

GAO reviews of three remote sensing information systems were presented with regard to economic and cost/benefit analysis issues. The 1975 review of the Landsat program included the production of additional satellites, production of Landsat photo-products and computer compatible tapes, and a variety of National Aeronautics and Space Administration (NASA) sponsored technical investigations. The objective was to provide an information report on this remote sensing technology to assist Congress in determining the direction of this program. Two contractor studies existed at the time concerning the costs and benefits of an operational Landsat system. Although the studies were comprehensive in their scope and treatment of applications, they were incomplete regarding cost analysis. While NASA provided the contractors with estimates of the satellite programs, it did not estimate related data processing and analysis costs. Therefore, GAO advised Congress that a decisionmaking Landsat and operational program was premature. Several problems were found with the methods the Large Area Crop Inventory Experiment program employed to determine the feasibility of improving foreign crop production estimates. GAO believed that an operational program based on the "ratioing" technique was not warranted, and a comprehensive cost/benefit analysis project was recommended. Overall, the analysis was useful. Although GAO was not in complete agreement with the accuracy assessment of the current forecasting methodology or the improvements in this type of system, it was informed that any model developed could be adjusted to quantify the benefits of a range of performance improvements; these needed to be carefully evaluated. The Agriculture and Resources Inventory Surveys Through Aerospace Remote Sensing program, a foreign commodity production forecasting project, also includes projects on domestic crops and land cover, renewable resources inventory and several others. Again, the lack of a cost/benefit analysis led GAO to suggest withholding funds for this project. In all of these cases, weaknesses in available economic analysis were significant factors in the recommendations of GAO. Improvements were needed so that inadequate economic analysis would not hinder remote sensing research and development.