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Letter to the Honorable Ted Stevens: NASA's Space Flight Operations Contract and Other Technologically Complex Government Activities Conducted by Contractors [i] (July 2003)

handle is hein.congrec/cbo9044 and id is 1 raw text is: CONGRESSIONAL BUDGET OFFICE                         Douglas Holtz-Eakin, Director
U.S. Congress
Washington, DC 20515
July 29, 2003
The Honorable Ted Stevens
Chairman
Committee on Appropriations
United States Senate
S-128, The Capitol
Washington, DC 20510-6025
Dear Mr. Chairman:
In response to your request, the Congressional Budget Office (CBO) has reviewed the past and
current use of contractors by the National Aeronautics and Space Administration (NASA) to operate
and maintain the Space Shuttle. CBO has also examined other cases in which the United States
government uses contractors to perform technologically complex activities. CBO's examination
focuses on selected activities that it judges to be of interest based on their content. While
informative, these examples do not constitute a comprehensive review of technologically complex
activities conducted by the government. Nor has CBO audited the performance of the government
sponsors or contractors involved in these activities.
The activities CBO examines span a broad range and include maintaining and upgrading weapons
systems, designing and producing weapon systems, operating and maintaining government nuclear
facilities, and designing nuclear weapons. The nature of the work contractors perform varies among
these activities. In some cases contractors are designing and producing complete multi-element
systems; in other cases the contractors maintain or install upgrades to specific government-owned
hardware or operate facilities for the government. How the government defines the work that the
contractors perform also varies-in some cases the government provides a set of detailed,
comprehensive specifications; in others the government uses top-level performance measures,
leaving some or many details to be defined by the contractors. The cost of the work varies from
annual expenditures of tens of millions of dollars to billions of dollars. The contracts used are in
some cases sole-source and in others competitively awarded; some contracts are cost plus fee, and
some are firm-fixed price. The size of the government workforce performing oversight of the
contractors varies from less than one hundred to more than a thousand people, and how that
oversight is conducted also varies. Thus, many of the elements of the examples CBO has examined
differ from the ways NASA uses contractors to operate the Shuttle. Nonetheless, all of the examples
considered by CBO involve the government's use of contractors to perform demanding,
technologically complex tasks, a situation that is not unique to NASA.

www.cbo.gov

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