Satellite contract won't fly

Failures highlight spy program mismanagement

November 11, 2007|By New York Times News Service.

By May 2002, the government's effort to build a technologically audacious new generation of spy satellites was foundering.

The contractor building the satellites, Boeing, was still giving Washington reassuring progress reports. But the program was threatening to outstrip its $5 billion budget, and pivotal parts of the design seemed increasingly unworkable. Peter B. Teets, the new head of the nation's spy satellite agency, appointed a panel of experts to examine the secret project, telling them, according to one member, "Find out what's going on; find the terrible truth I suspect is out there."

The panel reported that the project, called Future Imagery Architecture, was far behind schedule and would most likely cost $2 billion to $3 billion more than planned, according to records from the satellite agency, the National Reconnaissance Office.

Even so, the experts recommended pressing on. Just months after the Sept. 11 terrorist attacks, and with the new satellites promising improved, more frequent images of foreign threats like terrorist training camps, nuclear weapons plants and enemy military maneuvers, they advised Teets to seek an infusion of $700 million.

It took two more years, several review panels and billions more dollars before the government finally killed the project - perhaps the most spectacular and expensive failure in the 50-year history of American spy satellite projects.

The Future Imagery project is one of several satellite programs to break down in recent years, leaving the United States with outdated imaging technology. But perhaps more striking is that the multiple failures that led to the program's demise reveal weaknesses in the government's ability to manage complex contracts at a time when military and intelligence contracting is soaring.

An investigation by The New York Times found that the satellite agency put the Future Imagery contract out for bid in 1998 despite an internal assessment that questioned whether its lofty technological goals were attainable, given the tight budget and schedule. Boeing had never built the kind of spy satellites the government was seeking. Yet when Boeing said it could live within the stringent spending caps imposed by Congress and the satellite agency, the government accepted the company's optimistic projections, a Panglossian compact that set the stage for many of the travails that followed.

Despite its relative inexperience, Boeing was given responsibility for monitoring its own work. At the same time, the satellite agency, hobbled by budget cuts and the loss of seasoned staff members, lacked the expertise to make sound engineering evaluations of its own.

The satellites were loaded with intelligence collection requirements, as numerous intelligence and military services competed to influence their design. Boeing's initial design for the optical system that was the heart of one of the two new satellite systems was so elaborate that optical engineers working on the project said it could not be built.

A torrent of defective parts, like gyroscopes and electric cables, repeatedly stalled work. Even an elementary rule of spacecraft construction - never use tin because it deforms in space and can short-circuit electronic components - was violated by parts suppliers.

By the time the project, known by its initials, FIA, was killed in September 2005 cost estimates ran as high as $18 billion.

"The FIA contract was technically flawed and unexecutable the day it was signed," said Robert J. Hermann, who in 1996 led the panel that first recommended creation of a new satellite system. "Some top official should have thrown his badge on the table and screamed, `We can't do this system at this price.' No one did."

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