National Airspace System:
FAA Has Made Progress but Continues to Face Challenges in Acquiring Major Air Traffic Control Systems
GAO-05-331: Published: Jun 10, 2005. Publicly Released: Jul 11, 2005.
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The Federal Aviation Administration's (FAA) multibillion-dollar effort to modernize the nation's air traffic control (ATC) system has suffered from cost, schedule, and/or performance shortfalls in its system acquisitions for more than two decades and has been on our list of high risk programs since 1995. FAA's performance-based Air Traffic Organization (ATO) was created in February 2004, in part, to address these legacy challenges. In this report, GAO examined (1) FAA's experience in meeting cost, schedule, and performance targets for major ATC system acquisitions; (2) steps taken to address legacy problems with the program and additional steps needed; and (3) the potential impact of the constrained federal budget on this program.
The ATO met its acquisition goal for fiscal year 2004. However, prior to the establishment of the ATO, FAA had experienced more than two decades of cost, schedule, and/or performance shortfalls in acquiring major systems under its ATC modernization program. For example, 13 of the 16 major system acquisitions that we reviewed in detail have experienced cost, schedule, and/or performance shortfalls when assessed against their original milestones. These 13 system acquisitions experienced total cost growth from $1.1 million to about $1.5 billion; schedule extensions ranging from 1 to 13 years; and performance shortfalls, including safety problems. We found that one or more of four factors--funding, requirements growth and/or unplanned work, stakeholder involvement, and software complexity--have contributed to these legacy challenges. While FAA met its recent acquisition goal, it is important to note that this goal is based on updated program milestones and cost targets for system acquisitions, not those set at their inception. Consequently, they do not provide a consistent benchmark for assessing progress over time. Also, as indicators of annual progress, they cannot be used in isolation to measure progress over the life of an acquisition. Although additional steps are warranted, FAA has taken some positive steps to address key legacy challenges it has had with acquiring major systems under the modernization program. For example, the ATO has cut funding for some major systems that were not meeting their goals and is reassessing all capital investments to help ensure that priority systems receive needed funding. The ATO has improved its management of software-intensive acquisitions and information technology investments and begun to more actively involve stakeholders. As we recommended, the ATO plans to establish an overall policy to apply its process improvement model to all software-intensive acquisitions. However, additional steps could be taken to improve its management of system acquisitions. For example, the ATO could use a knowledge-based approach to managing system acquisitions, characteristic of best commercial practices, to help avoid cost, schedule, and performance problems. The ATO will also be challenged to modernize the ATC system under constrained budget targets, which would provide FAA with about $2 billion less than it planned to spend through 2009. To fund its major system acquisitions and remain within these targets, the ATO has eliminated planned funding to start new projects and substantially reduced planned funding for other areas. However, when forwarding its budget submission for review by senior officials at FAA, DOT, the Office of Management and Budget, and Congress, the ATO provides no detail on the impact of the planned funding reductions on ATC modernization and related activities to modernize the NAS. Our work shows that the ATO should provide these decision-makers with detailed information in its budget submissions about the impact of funding decisions on modernization efforts. Without this type of information, decision-makers lack important details when considering FAA's annual budget submissions.
Recommendation for Executive Action
Status: Closed - Implemented
Comments: In our December 2007 report we stressed the importance of ensuring that key administration and congressional decision makers and stakeholders have complete information on the budget and schedule performance of FAA's critical Air Traffic Control acquisition programs. We recommended in that FAA improve the objectivity, reliability, and inclusion of core programs in ATO's acquisition performance measures by establishing written, objective criteria and guidance for managers to use in determining which programs are major and thus selected for performance reporting and in selecting schedule milestones. Since 2009, FAA has defined "major programs" as new investments with acquisition category levels of 1, 2, or 3 (there are 5 levels in total). Each of the three category levels contains programs that require special management attention because of their importance to the agency's mission as defined in Office of Management and Budget Circular A-11, Part 7. Programs in the three categories include those with high development, operating or maintenance costs; high risk; high return; or a significant role in the administration of FAA programs, finances, property, or other resources. FAA reports on the performance of the major programs contained in acquisition categories' 1 through 3 in Appendix D of its Capital Investment Plan which it submits to Congress. With this action, FAA can provide assurance that programs important to the transition to NextGen are on time and within budget.
Recommendation: To help ensure that key administration and congressional decision-makers have more complete information to assess the potential impact of annual budget submissions on individual ATC system acquisitions, the overall ATC modernization program, and related larger-scale National Airspace System (NAS) modernization activities funded through the facilities and equipment budget, the Secretary of Transportation should direct FAA to identify which activities under the ATC modernization program have had funding deferred, reduced, or eliminated and to provide detailed information about the impact of those decisions on FAA's ability to modernize the ATC system and related components of the NAS in the near, mid, and longer term. This information should be reported to Congress annually.
Agency Affected: Department of Transportation