Support Service Contracting at Johnson Space Center Needs Strengthening

PSAD-81-2: Published: Oct 21, 1980. Publicly Released: Oct 21, 1980.

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The Johnson Space Center (JSC) relies heavily on private business firms to fulfill its mission requirements. JSC annually spends about $175 million on 33 contracts for support services which include: developing and providing spacecraft and related equipment; training astronaut crews; devising and refining spaceflight techniques; advancing lunar and space science; advancing Earth resources technology and application; and developing engineering and operating capability to support these projects.

GAO reviewed six contracts as a test of how the procurement system operates. It found that 83 percent of the work, under work orders written during the first 6 months of one contract, had been started and, in some cases, completed without proper authorization from JSC officials. Government-furnished equipment valued at about $35,600 was unaccounted for and written off without adequate investigation. For 3 years, a contractor who did not have an accounting system was being reimbursed for incurred costs under a cost-type contract. On two other contracts, additional money was made available before a need for the funds had been established. JSC spends about $1 million annually for health services from a private firm, and although a U.S. Public Health Service hospital opened near JSC in 1978, no consideration has been given to determining whether the hospital could provide any or all of the health services JSC requires. The basic reasons for inadequate contract administration include (1) an unawareness on the part of some contracting officers of their full range of responsibilities, (2) the general attitude of some contracting officers that small dollar value contracts are not worthy of attention, and (3) resources for administering these cost-type contracts appeared inadequate.

Recommendation for Executive Action

  1. Status:

    Comments: Please call 202/512-6100 for additional information.

    Recommendation: The Administrator of NASA should see to it that the Director of JSC (1) directs that work orders be authorized before contractors actually perform work and not after the fact, (2) makes a physical inventory of Government-furnished equipment in the possession of contractors and not write off equipment without appropriate investigation, (3) recovers any inappropriate payments made to contractors, (4) avoids contracting with contractors who do not adequately support their claims for reimbursement under cost-type contracts, (5) ceases funding contracts before needs have been established, (6) determines the feasibility of providing all, or a portion of, medical service needs at the nearby Public Health Service hospital facilities rather than continuing contractor-operated facilities.

    Agency Affected: National Aeronautics and Space Administration


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