In" I . INSPECTOR GENERAL Dcpurnm'nt 0/ IJI?fvnw' vml-wr 8, 2m 8 Repel! 2015-170 AUDIT OF THE ACQUISITION OF THE LONG RANGE STRIKE-BOMBER I USAF (him E0 13526 secs - . I - Esriwd from I 1 g: 11mUSAF. E0 13536? secs 1 1 1 4sz 1 4(a) 14(c)? 1 4(9) 14'Lz) INTEGRITY i EFFICIENCY ACCOUNTABILITY i Mission Our mission is to provide independent. relevant and timely oversight oldie Deponment of Defense that supports the wot?ghter: pmmota accountability. inmrity, and e?dency: advises the SW of Defense and Congress; and inform: the public Vision Our vision is to be a model oversight organization in the Federal . Government by leading change. speakirg truth and promoting excellence?o diverse agonimtion. working together as one profeaional team. recognized as leaders in our ?eld Fraud. Waste I: Abuse HOTLINE Department of Defense dodlq.mulhonlne For more information about whiuleblower pmu-cuon. plate see the inside but cover. USAF (1), E0 13526. secs 14(3). 14(3) USAF (b)(1)iE013526isecs 14(ait 14(eli 14(3) (U) Results in Brief I September 8, 2015 Objective (U) (U The overall objective was to evaluate how was preparing the Long Rangi- Strike-Bomber program for Its next acquisition milestone (Milestone 8). we determined whether early planning for the was .lill'qUJlL" and if users' requirements were being met. Findings (U) Early planning forthe Long Range Strike-Bomber is adequate and the program management office is preparing for the Milestone 8 denis'ion. Speculically. the program management of?ce has: 0 (U) A comprehensive acqumtion strategy and risk management prom-s: to wpnort a Lust-cffcutlw program. (U) ('luurly dehnerl roqumrment'; to ensure users? needs are being met: 0 (U) A detailed contrarung strategy to develop the Long Range Strike-Dumber program. and I I 0 (U) Adequately developed and incorporated a process to develop an Accurate cost position, and pruumm schedule. (U) In addition. the program management of?ce has integrated om'onty early in the acquisition and is pruwditm day-today security management for the program. Management Comments and Our Response (U2: (U) We provided a discussion draft report on Iuly 31. 2015. No written response to this report was required. and none was received Therefore. we are this repun in ?nal form. USAF (11 E0 135.26. secs 14(21). 14K). (U) Recommendations Table hm u? thuumg .l (U) Under Secretary 0! Defense tor Terfmology, and Logmk? (l None (U) Secretary of the Air Force. Security, None and Special Program (Mar (U) Assistant Secretary of the Air Force (Funanc nf (UI None Management and Compumm) (U) Director, Department of Defense Speaal Acres" (U) Home Program Central Of?ce USAF (1). EO 13526. secs 14(3). IMO. 14(6)? 1 411g.) (1). E0 13526. secs INSPECTOR OIIERAL some!? ?commune mm September 8. 2015 MEMORANDUM FOR DISTRIBUTION FOR UNDER SECRETARY OF DEFENSE FOR ACQUISITION, TECHNOLOGY, AND LOGISTICS SECRETARY OF THE AIR FORCE. SECURITY COUNTERINTELLIGENCE, AND SPECIAL PROGRAM OVERSIGHT ASSITANT SECRETARY OF THE AIR FORCE (FINANCIAL MANAGEMENT AND COMPTROLLER) DIRECTOR, DEPARTMENT OF DEFENSE SPECIAL ACCESS PROGRAM CENTRAL OFFICE SUBJECT: (U) Audit ofthe Acquisition of the Long Range Strike-Bomber (Report No. We are providing this report for your information and use. Early planning for the Long Range Strike~aomber is adequate and the program management oillce is eifeetively preparing for the Milestone 8 decision, We conducted this audit in accordance with generally accepted government auditing standards (U) We provuded a discussion draft otthis report on My 31. 20! S. No written response to this report was required, and none was received Therefore. we are publishing this report in ?nal form We the courtesies extended on the staff. Please direct . nations to .OD 010 il OIG "bi: DOD 016 016 (6) DOD 016 (6) mas nspector General For Intelligence and Speaal Program Assessments USAF (11 E0 13526. secs 1 413). 14k). 1 1 4-19 (U) Contents (U)lntroduction.., (momemvn- . . ,1 (UH?Iackumund(U)I\cqumrinn Manuemam ofmo LRS-(U) and amnion(U) ngnm?ecur?y .--. 11 .. . . . 4 (U)Appendixes(?Mm-mum "Mlmdolnm' . (U) Append? B. Selmuryol Demise Meum . .. - .16 (U) Acronyms and Abbreviatium 19 USAF 14m). 14(ch 1 4119). 14g) USAF: (1) E0 13526. secs 1 1 1 14(g) (U) Introduction 5: U) Dbiizrfiwa?' The uvcrall was In limit- Imw m?mugcnu-m? was readying the bong HJng? progrim i'or iix m'xt :it?quisiliun milestone.- [Milestone B). we dvim nnm-ui wln?ziwr tin- planning for the syxic-m was advqualr and If us: 73' n-mnrt-rm'ni? being mu. 3W Apps-mm A fur the 5'me and used to meet the and): uhm 1m . aw. SAP: (1). E0 13526. secs 1 4(g) (U [#0663 The LRS-B will be managed as an Acquisition Category ID equivalent program. Huwevm, due to the classi?cation of the it is not covered by the statutory definition of a Major Defense Acquisition Program. (ll/#0305 USAF. (law). 10 Toexecute rh use i?Ps?p?l?iSiNllih? 51 rim PMD is split into two nmim lmarhms a! Wrigiwi?anmzsun Air Force Base Dumn 01110 Huilmu, Washington. DC. (1). E0 13526. secs 1 1 1 1 4L2) USAF (UHF-080) Secretary oi Defense Requirements. Additionally. in the FY 2013 National Defense Authorization Act, Congress mandated that the LRS-B be; 0 (U) Capable of carrying nuclear weapons. at initial operating capability; and I (U) Certified to employ nuclear weapons. two years after initial operating capability. Nuclear certi?cation activities will occur in a follow?on increment. (U) LRS-B Users. The Air Combat Command and the Air Force Global Stn'ke Command are the major LRS-B stakeholders. (U) Air Combat Command. The Air Combat Command is the primary iorce provuder of combat airpower to Amenca's war?ghting commands. To support global implementation of national security strategy. the Air Combat Command operates lighter. bomber. reconnaissance. battle-management. and electronic-combat aircraft. The Eighth Air Form, headquartered at Barksdale Air Force Base, supported the Air Combat Command by providing nuclear capable bombers and it controls these assets throughout the United States and overseas locations. (U) Air Force Global Strike Command. The Air Force Global Strike Command is responsible for developing and providing combat ready forces for nuclear deterrence and global strike operations to support the President of the United States and Combatant Commanders. On April 1. 2015, the management of the LRS-B pmgram was transierred from the Air (Lomhat Command to the Air Fonce Global Strike Command. (b)(l)lE013526lsecs 14(3)? 14(c). 14(e)o 14(g) (U) Finding (U) Acquisition Management of the (ll/m Early planning for the LRS-B is adequate and the PMO is e?ectively preparing for the Milestone 8 Decision. Speci?cally. the PMO has: a comprehensive acquisition strategy and risk management process to support a cost-eti?ective program: clearly defined requirements to ensure users' needs are being met; a detailed strategy to develop the LRS-B program: and adequately developer! and incorporated a process to develop an accurate cost (3). 10 123 position. and program schedule. Pmnram Status. The PMO is preparing documentation for the next ucqui>itiun pllilw. the LRS-B acquism?on program is in the Technical theolopment phase and is scheduled to enter Engineer-i ng and Manulacturing Development (EMU) in fall 2015. in July 2014, senior management approved the release of the Request for Proposal [Ill-1?) for EMU and Production. (U) Program Management and Execution (U) Early planning for the LRS-B is adequate. PMO oilicmls are taking steps to develop a cost-effective and efficient acquisnion The PMO has developed a comprehensive .itquisition strategy. which has adequate measures to develop a cost-e?ective and ef?cient program. Ac uls1tion Smite ~t . USAF 1 14(c). 1 4g) 1 SAY: (3). primrm U17 star 0" HM). (ll/,m Approach. ?it? mull? numry appruarh m. unpmu m; lum-quu . our: the M1519 LRS-B program. Data Rights Nuclear Capability. .mlim' (he .nugy. the ham-line .dehllv'x- wil! inc Emir all In: ch" In Mr} mm Iasnu'uwry In make the mpgmu?nt mnymu it?: H?Imcmn. . . USAF: 3.10USC <122;10U5c and rc-Jl?mm- rhz- [361-13 nuumr Wed mu. 5 no (W) 5 SAP: (1) E0 13526 secs 14(3) 14(c). 14(e). 14(g) (ll/m Risk Mallagmucnl. The" PMO in. unpwuu'mnl .1 formal rm. Rpm. lhc' PMO an?; the RISER Guide for DOD Arquwitinn, Sixth E-htluu I'Auumx .lol'bl LU Idvuhl' . 1,;un muw?c Thr: l'mh'r (invu mncul. it. I'c'eumueiblc fur mi: u: a-mmnro mm the [Ihilzw USAF: (3). 130 a: Mllux?tunc B, the PMO JSSEI (5 what they will have stable ruqulrwnem? "law. Th? (Lowrmm-m will mm tu-wx on an uh nnlumun and ?naive mitigation risks. USAF: 10 130 (ll/ml) Requirements. The we: needs are bein met. 'of the Air Force duculc-d that through the FY 2013 National Defense Authorization Act, Canal-ass mandamd specl?c nuclear rcquimumnts for the E0 13536. secs 1 4(a) 1 1 4(g) 0 Avmnw- limit .l ofamurr: Mrma iy $5150 milimn (F5 32m! 2010 hand on a ?we! oi Ht! 100 min tr. balanu-t with USAF: (1) E0 13526. secs 14(3). 1 1 14(g) SAF: (1). 13013526 secs USAF: (1). ?0 13526 secs 14(a)1 14(c). 14(e). 14(2) Requirements Documents. The PMO has completed the initial Capabilities Document. the Capability (Development Document. the System Requirements Document, and the Capability Vesii?imtion Plan {in advance of the source selection) that adequately define user requirements. All of the Federal (iovemmont and contractor speci?cations are under formal con?guration control. (U) initial Capabilities Document. The Initial Capabilities Document adequately identi?es the validated threat and identifies the LRS-B weapons as long range survn 6 and nuclear strike platform. The LRS-H weapon water? will in .dwp with pmriso USAF: (1). E0 13526. secs 1 1 1 1 uI'iInIg and quirk mm min tn (?Ti'xlil Slt'fi?SS l0 titr throat untirumhvni; Requirements Document. The Requii?c?iili'iils DIu'IImvht (Iii-veiupmi 1: the draft Capainiiw iimuimz mi .Idmudh It itidivw Ii: .cI needs and are .Itict II. In tm 'Lite LRS- B. Capabilities Veri?cation Plan. The Veritiutt?un Plan vunlics that the Key Paiidiimtrfi were ill?! in the user Under this a ?match, the Federal Government assumes some of the research and SAP: (3). 41 USC 2102(a)(1) cim'eiu risk. The nim-rnw If: to Imedt- a strong int?cntiw for Indusrry to accomplish the work rI-Quimi in EMD to matune the aircraft design and the ill. ?tuning: pimcsses. Awarding tothe PMO this matiurd will Request For Pmposal. PMO ulluml?; have?: Issued an RFP with dctaumd sum ?it almm Hic- r? uulmtn flu:- The RFP In!? Lha- wulu alum}. that me . USAF: (3). 41 BC 2102(ax1) related to the M- USAF: (1). E0 13526. sec 1 7(9) (U) Program A?ordabmtv (U) The PMO Im adequne (n dwelup .u'uamrn me: and Iundmg for [he ALqumumn .m l. (ll/m Development of Program Cost Position. Air Fnrre (th Amly?wc Agency Of?ce team the [trump which was cndurscd by the Dupmy Assam"! ?La for C011 .md [?uxmmurz and Based (m inalysi?. the Uni l'rnni .mi Evaluation [ii/WI.) mnrurrul WIth the Miiusmno 8 cost estimate. Awarding to PMO ammo the CAPE will certify the program as 1Hi?l'lh0 wim tinn di'i'tsiun and government estimate completed in August 2015 The review of the lunding ensures .u cunt-r and rill-nice approach for funds USAF: (1). E0 13526. secs 1 1 4(2) (U) The PMO annually reviews the government cost estimate, tuiulmmonts, and resources to ensure the accuimy of this information. Changes to the program's rcquimmonts and resource components are by the Con?guration Control Board The (Ionfliguntion Control Boa rd ls an advisory board composed of technical and management representatives whose primary function is to vet and determine appmva orlty for all program, engineering, and contracting changes. The CCB consists ol?mgram office functional leadcm to include Contracts, Engineering, Finance. Integration. Logistics and Sustainmenr. Program Management. Sammy. and The 2366b Ct?llilltit't??l ensure) that th. magnum 1.. aulilimnuy USAF: (1). ?0 13526. secs 1 1 4(c)V 1 4(g) (U) Program Schedule Milestones. The LRS-B [migram milestones are evaluated annually in with the Inn-(lint: and when program change-v occur. The PMO [n-riurms the: in mm dumlimi with the Air Force Cast Analysis Improvement (imup. Table 1 below provide: the maior LRS-B Pnims: SAP: (1) ?0 13526. secs 14(a). 1 14m 14g) (1). E0 13536. secs 1 4(a) 4(e)1 1 4(3) the l-lsnmalo and Life Cycle Cost Estimate will not he .wnlahlc until after the CAPE revnew. The expound completiun date of the CAPE review is the summer of 2015. (U) Program Change Process. The with minimal ?-lmnum; they do not have a dedicated program dncumirnt listing all changes to the the PMO 1 barium; In n-muri N, and technology through the (Iuniigumlinn Board review Additionally, the PMO Air Force Rapid [ammunition Office leadership, and the Rapid Of?ce determine Changm ro the government usn'mam through their annual update. The PMO's program irhangc are? is by dccusion from the Himnecq Manage-mm" Rr-wrw which vulminc tn the program and rcxuUIU" (U) The PMO the pmgram'c change: rn an (l?'hth?tl shared drive separated by each nvenatghl vutuv Hnwever. there ts no musulidalml lining of program Chang? in the shared drive. Although not tequnud, we suggest the establislunent ofa Pmlett' 'l'mt?klng Sheet which could be used as a best tor the program, future prawns, tnnelmr nth-went) . and Nut/1??! nment sawngs ?l'hls would taptun the fullow?ng tnfunnatiun: mudillt alums to the prurient, date mudl?mtiun was and appruved; approval .tuthurtty ctgnature for the .nrtinn; and effects of the mmlilltatmn (meuty Savmgs and mluml Ellmelu (U) Program Security The PMO ls lmeumhng xevurlty early the acquis'umn and prowling timely management for the prugmm. (tr/reeves LRS-B Program Protection Plan. (U) Classi?cation Guides and Policy Guidance. The PMO completed security guide-3 and policy guidance for the LRS-B program. In addition. the PMO developed medla engagement guidance and visit mmu?mtton prm?edures This drrectluu will help PMO pmtut and maternal with the SAP. (U) Accreditation. 'l?he PMO pruwdrd current utility tlm?umcutatimt, rem-rs: [or wlor'tml PMD am- hc The of the SAP ensures that the PMO has the of the t'ucilittca it USAF (1). E0 13526. secs 14(3). 1 Program Across. (U) The PMO muten?y issued an RFP which requires the contramnr to categorime its system sncurity controls in with the most recent federal mhnmauon gutdamc' RFP rvquu'vs with National Inc?itutr of Standards and 'l?rcmmiugy Sun ?00w?. 4 "Sam My and (.nnlruh? ior I-ede: 1i Inimma'uml Syslumza 1m um; 1?2. 2015 (April 201L313 This 15;: pmactivc? by the PMO 3mm the DOD Spud-ml Access Pmm'mm I The National Institute of Standards and Yt-mnnluny Special Publmation 80053, 4, uuidr?ines (or minding and weaving security cantrols for mgmiza?ons and system-s the executive branch agendas of the federal USAF: (1). E0 13526. secs 1 4(c)V 1 1 Central Office policy gowrning SAP automated information systems only includes National Institute of Standards and Technology Special Publication 800-53. Revusinn 3 guidance. (U) Training. The PMO conducts adequate annual security awareness and information assurance training for its employees. We selected a judgmental sample of PMO employees and con?rmed their completion of mandatory annual security awareness and information assurance training requirements. The completion of annual security awareness and information assurance training ensures that PMO employees one aware of their security responsibilities. (U) Summary Early planning for the LRS-B is adequate and the PMO ls ellectlvely preparing for the Milestone 8 declsnon. PMO of?cials are taking steps to develop a cost-e?ective and ef?cient acquisition program. The PMO has developed a comprehensive acquisition strategy and well-defined requirements. The PMO has also incorporated adequate processes to develop accurate cost positions and funding requirements for the acquisition program. In addition. the PMO is integrating security early in the acquisition and providing timely security management for the program. (U) Appendixes (U) Appendix A Scam and ?i?lethnriilomgy (U) We condiicrmi this peiformam'c audit from September 2014 through August 2015 in sllIL??l?ll?llCL? with geneml'y awaited government auditing standards. Those standards require that we plan and perform the audit to obtain sufficient, evidence to pmvidc a reasomhle basis for nur ?nding and based on our audit objectives. Our scum was limited in that we did not imfm tests of the management central 4. (U) We pm?nmcd site visits and mm viewed Emmanuel at the following Nations: 0 (U) PMO Dayton, Ohio 0 (U) PMO loint Base Anarmm Bolling. Washington. (I. 0 (U) The Pentagon, Arlington. Virginia (U) We did not visit all government and comratmr locations SAP: (3). 10 USC 128: 10 130 We rcwewwl the LRS-B FY 2015 FY 2020 Preliminary Cost positinn and Cost Es'limatc Revww We the 2366bf.er1imahon Memo. We LRS-B (L051 Estimate ch'mw brie?ng Charts. We also reviewed the FY 2015 and FY 2016 Research. l?m hnulugv, and Engineering Budget Item Justi?cation ducumentnnon. USAF: (1). E0 13526. secs 1 14(c). 1 1 4L2) USAF: 14(a). 14(9)? 14(g) USAF (1). E0 135.26. secs (U) Use of Computer-Processed Data (U) We did not use data to perturm this audit. (U) Prior Coverage (U) During the last (we years, the Gem-mi Of?ce (GAO) issued one report related to the LRS-B. [Jim-striated GAO nepuns can he ?war the lnierncl at W. (U) GAO (U) GAO Report NIGAO-H-373. "Nude." meuns; Ten-Year Budgct Estimates for Modernization Omit Key Eiforts. and Assumptions and Limitations Are Not Fully 'i?i anslm'em,? lune 10, 2014 SAP: Cb) (1). E0 13536. secs 14(21). 14(c). 14(e). 14g) USAF (1). E0 13526. secs 1 1 4(g) (1). E0 13526. secs 14(a). 14(c). 14(2), ucatumr 0' Vohmnuvm wm Ina-M In? MWDRANDI 1M FOR OF THE All WRCF. CHAIRMAN KMNT CHIEFS OF STAFF UNDER SUBJECT. 1m Suit- and Malta. optima? Kahuna. AF )3 FY11 Odin-a 01! Run: ?ank?. 10 USAF (1). E0 13526. secs 1 1 1 4(g) USAF: (1). E0 13526. secs 1 1 1 1 4(g) (U) um. Mam ?moon-?dam mm unho- ulna, luau nu USAF: (1). E0 13526, secs 14(a). 14(2) USAF: (1). E0 13526. secs 1 1 1 1 (U) Appendix B. Secretm?y of Defense Memo (cont?d) USAF: (1). E0 135.26. secs 1 1 1 4(g) SAP (1). E0 135.36. secs 14(3). 1 14(e). 1 4(2) SAP: (1). E0 13536. secs 1 1 1 4(g) (U) ldm?uh?awn' wp-hwlbuulm .mwcwuwwm syutm a. Awm Uak IMWImecq-hhywuh ?oMl-ay. Maui: mm open to nuk- m-mi (mm: pus-au- qua-nun USAF. (1). EO 13526. secs 1 1 1 1 4(2) USAF. (1). E0 13526. secs 1 1 4(g) (1). E0 13526. secs 1 1 1 1 4(g) -. SAP: (1). E0 13526. secs 14(g) (U) Appendix B. of Joi'e'mse Memo icont'd) SAP: (1). E0 13526. secs 1 1 1 1 4(g) 1 1 1 4(g) SAP: (1). E0 13526. secs 1 1 1 14(g) 1 4(g) 1 1 1 4(g) SAP: (1). E0 13526. secs 1 1 4(g) USAP: (1). E0 13526. secs 1 1 1 1 cc: USSTNATCOM CAPE USAF: (1). E0 13526, secs 14(a). 14(c). 14(e). 14(g) Am CAPE EMD ISR PMO RFP SAP SOP WPAFB (U) Acronyms and Abbreviations Air Force Cost Analysis Agency Cost Assmment Ptogram lualuahon Engmcenng and Manuhctuung Development Intelligence, Surveillance, and Reconnaissance Long Range Strum-somber ongram Management O?cce Plagum Ptotectlon Plan Request (or Propoul Special Access Program Standard Open-um; Proceduu-a Wright-Patterson Air Force Base USAF. (1). E0 13526. secs 14(a). 14(c). 1 4(g) USAF E0 13526. secs 1 1 14(e)? 1 4(3) Whistleblower Protection US. DEPARTMENT or DEFENSE The Whisdebiowar Protection Enhancement Act of 2012 requires the Inspector General to designate a Whistlebiower Prom-don Ombudsman to educate agency employees about prohibitions on retaliation. and rigim and remedies against retaliation for protected disclosures The designated ombudsman is die 00D 16 Director ?zr Whisdebiowing humpamnty. For more information on your right: and remedies against "collation, go to the Whistlebiower webpage at mdodigmii/progmms/whisdebiamr. For more information about 000 [6 reports or activities; please contact us: Congressional Liaison 703.604.8324 000 Hotline MA 24.9098 Media Contact 703.604.8324 Update Reports Mailing List Manon-requestolistm.m Mtur USAF: Cb) (1). E0 13526? secs 1 1 4(g) USAF (1), EO 13526. secs 14(a). 14(c). 1 14(3) USAF: (1). E0 13526. secs 1 1 14(e). 1 4(g) USAF (1). E0 13526. secs 1 4(3) 1 14(6). 1 4(g) ?Ill"I?