Todd Jacobson
NS&D Monitor
6/13/2014
The Department of Defense has underestimated the amount of money it will cost to modernize its nuclear forces over the next 10 years, according to a new Government Accountability Office report that echoes similar findings about the NNSA. In December, the GAO highlighted shortcomings with NNSA budget estimates, noting that the costs of a new cruise missile warhead and an interoperable warhead were not fully included in the projections. This week, the GAO said the Pentagon’s $125.5 billion estimate for modernizing its nuclear delivery vehicles didn’t account for plans to modernize the Air Force’s fleet of Minuteman III Intercontinental Ballistic Missiles or to develop a new nuclear bomber. “Consequently, DOD may be significantly underreporting its 10-year estimate, depending on the magnitude of the costs resulting from upcoming decisions about how to modernize these delivery systems,” the GAO said.
The Air Force has yet to make a decision about replacing the Minuteman III, and told the GAO that it would be too early to include “potential budget estimates for development programs in their early stages because their long-term costs are uncertain.” The GAO, however, said a range of costs would provide a more clear picture of modernization costs. “By treating key Air Force modernization efforts as zero-cost, instead of including a range of potential budget estimates based on preliminary cost information, DOD limited the value of the joint report as a congressional tool for understanding the estimate or for assessing the long-term affordability of DOD’s modernization plans,” the GAO said.
GAO: ‘All Relevant Funding Estimates’ Should be Included
The GAO previously urged the NNSA to include a range of cost estimates for warhead life extension efforts and construction projects that are considered preliminary, and it urged the Department of Defense to do the same. “Key principles that GAO derived from federal budget guidance stress the importance of including all relevant funding estimates in the plan, as well as documenting methodological assumptions and potential limitations,” the GAO said.
The GAO in December noted that modernization costs for the NNSA rose to $187.9 billion in FY 2014, up $19.2 billion from FY 2012, but it said the costs only include about $5.4 billion in its budget estimates for the first three phases of the Uranium Processing Facility, though a recent report by the Cost Assessment and Program Evaluation group suggested that just the first of the project’s three phases—moving uranium production capabilities from the 9212 complex— could cost between $10 and $12 billion, or as much as $19 billion in a worst-case scenario. The NNSA has since abandoned a plan to build a standalone UPF in favor of a scaled back project that is likely to be much cheaper.
NC3 Estimate Questioned
The GAO also questioned DoD’s $40.8 billion estimate to revamp its nuclear command, control and communications (NC3) systems, arguing that its estimate is not fully transparent because key assumptions and potential limitations are not documented in the report to Congress. “As a result, Congress has a limited basis for understanding the estimate, or for comparing the estimates in one annual report to the next, as it assesses long-term affordability when allocating resources,” the GAO said.