The Content and Uses of Shuttle Cost Estimates
NSIAD-93-115: Published: Jan 28, 1993. Publicly Released: Mar 2, 1993.
- Full Report:
Pursuant to a congressional request, GAO reviewed the National Aeronautics and Space Administration's (NASA) estimates of the space shuttle's average cost per flight and marginal cost per flight, focusing on: (1) the costs NASA included or excluded from each estimate; and (2) how NASA should allocate these costs to payload missions that are transported to space in the shuttle.
GAO found that: (1) the average cost per flight, estimated at $413.5 million in fiscal year 1993, includes most costs that NASA budgets as shuttle operations; (2) the average cost does not include any of the $30.2 billion spent through 1992 to develop the shuttle, acquire reusable hardware, and construct and modify facilities; (3) the average cost per flight does not include the more than $1 billion that NASA estimates will be needed annually for future shuttle upgrades and for improvements; (4) NASA estimated the marginal cost savings associated with deleting a single flight at $44.4 million; (5) NASA states that fixed costs required to maintain the capability to fly the shuttle eight or nine times per year account for 90 percent of the total operations cost of a flight; and (6) NASA uses the marginal cost per flight when attributing shuttle transportation costs to payloads because the elimination of a single flight in a given year would allow NASA to avoid only incremental costs.
Recommendation for Executive Action
Status: Closed - Not Implemented
Comments: NASA has rejected the recommendation. NASA believes that even with the use of the shuttle by the Space Station Freedom program, the shuttle would still fly six to eight missions a year. Therefore, the programs are mutually exclusive and only the cost of the incremental use of the shuttle by the space station program should be recognized. GAO rejected this position in its response to NASA in NSIAD-93-187 and NSIAD-93-208, both dated May 18, 1993.
Recommendation: Although NASA should continue to use marginal cost per flight estimates to allocate shuttle transportation costs to payload missions that are only occasional users of the shuttle, the Administrator, NASA, should use the average cost per flight when calculating shuttle transportation costs for the Space Station Freedom program during those years when the station is the predominant user of shuttle capabilities.
Agency Affected: National Aeronautics and Space Administration