Raytheon agrees with IG criticism of FAA program

Raytheon Co., the prime contractor for the Federal Aviation Administration's Integrated Terminal Weather System, said it agrees with an agency investigation that claims the program has suffered from delays and cost overruns caused by expansion of the system's original requirements.

In a Dec. 20 report, the Transportation Department inspector general's office blasted the FAA for its mismanagement of the project.

"Production costs are three times higher than expected, increasing from $360,000 to $1.1 million per system, and the FAA cannot execute the program as planned within the existing budget and schedule," the report said.

As a result, the agency intends to extend the deployment through June 2008, nearly five years later than scheduled. The agency also will have to come up with another $55 million in funding to finish the deployment and add planned enhancements by the end of fiscal 2009.

Without the additional money, the FAA intends to defer several planned enhancements, and the production systems will be less capable than the prototype systems, the report said.

"It's unfortunate the FAA doesn't do a better job estimating what it's going to cost to do these systems," said Bill Marberg, director of business development at Raytheon Air Traffic Management Systems.

Raytheon of Lexington, Mass., was awarded the $286 million contract in January 1997. The FAA was looking to deploy 38 systems to support 108 air traffic control towers, terminal approach control facilities, en route centers and support facilities.

Marberg said the report was correct in blaming the delays and cost overruns on the FAA's expansion of its requirements for the system beyond what was originally planned. "The amount of software that was developed changed, and the hardware configuration dramatically changed," he said.

While Raytheon agreed with the criticism, the company considered the cost overruns insignificant. "We're really arguing about a relatively small amount of money; it pays for itself in less than a year," Marberg said. "The systems themselves offer in excess of $100 million in savings through fewer delays."

The FAA also concurred with the report's results and findings.

"We generally agree with all the report recommendations," said FAA spokeswoman Rebecca Trexler.

The Integrated Terminal Weather System is a display intended to provide traffic managers better information on bad weather conditions, the leading cause of flight delays.

After getting feedback from users of the prototype system under development, the FAA added more features, such as integrating data sources into the display and improving the maintainability of the system, all of which boosted the cost and stretched out the delivery time.

Another reason for the problems was that the FAA accepted Raytheon's production bid several years ago without immediately negotiating its elements, Marberg said.

"When we submitted our production bid, there were a lot of assumptions in there," he said. "When you get these proposals in, [you must] promptly negotiate them and identify those areas subject to change, rather than let them sit for a couple years."

For example, one premise of the production bid was that there would be a limited number of dedicated test systems for the weather system, which would be moved from site to site, perhaps within a specific region.

When Raytheon took a closer look at that idea, the company decided it was not practical, and it would make more sense for each site to have all the tools on hand.

The IG report actually praised elements of the new system, especially a 60-minute weather forecasting feature that could significantly assist controllers at airports that frequently suffer from serious storms. But the report said the FAA did not set up a deployment schedule that gave priority to airports that could most greatly benefit.

The aviation agency now is deciding whether the deployment strategy should be changed.

Government Computer News Staff Writer Dipka Bhambhani contributed to this story.