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OCX Gets Good News, Right After Nunn-McCurdy

Posted by Colin Clark on

OCX concept image

LONDON: The most troubled program in the Air Force, the highly-secure set of GPS satellite ground stations known as OCX, underwent yet another quarterly review last Thursday and was found to have “made progress.”

The Air Force statement says that Acquisition Undersecretary Frank Kendall and Air Force Secretary Deborah Lee James, “with support of Lt. Gen. Samuel Greaves, Space and Missile Systems Center commander and Air Force program executive officer for Space, concluded Raytheon has made progress implementing these critical changes.”

This comes after six months of really bad news for the Operational Control Segment (OCX) program. Just 10 days ago the Pentagon declared the program had incurred a Nunn-Mccurdy breach, meaning it had busted its cost estimates by more than 25 percent. It triggered congressional notification of the breach and a mandatory review to decide whether to cancel the program or to continue it on the basis that the program is vital to national security, no reasonable alternatives exist, and that the Air Force has a well-founded plan to put the project back on track.

My bet is that Frank Kendall, head of Pentagon acquisition, will recommend to Defense Secretary Ash Carter that OCX be built. Although Kendall and senior Air Force officials have made very clear their displeasure with Raytheon’s progress, the fact is that this $4.2 billon program is really important because GPS 3 satellites’ stronger, more accurate and more jam resistant signal can’t be effectively used until the ground stations are up and running. Starting over would put the country years behind.

The Senate Armed Services Committee stripped all $394 million of OCX funding from its version of the National Defense Authorization Act in early June because of the program’s problems. Senate appropriators cut roughly half of the program budget, so there’s a good chance the program faces a substantial budget cut just as its costs are rising. As numerous studies have shown, cutting money to a program at a time like this — unless you plan to kill the program or the money simply cannot be spent — often results in even higher costs.

OCX cyber protectionThat may be especially true in this case, where the Air Force statement says Raytheon has made progress “in increased automation in software development, platform deployment, as well as an improvement in their software approach.” I hear that Raytheon grappled with Air Force requirement changes to the software and faced the challenge of doing something for the first time: design and build a ground station highly resistant to any form of cyber attack and automate the control system. Now Raytheon appears to be getting their feet underneath them.

You can be sure Kendall will keep pressure on Raytheon, through the quarterly reviews, memos and press statements. Congress may fence or cut funding until they see at least two or three positive reviews. But OCX will probably be built.

What do you think?