Summary

GAO reviewed a Forest Service program to develop a lighter-than-air vehicle to demonstrate that aerial logging operations are economical in steep, inaccessible mountainous terrain.

GAO has found that the original net cost of the program has increased about 373 percent. Because the remaining development work has not been clearly defined, the validity of the revised cost estimate has not been assessed. However, this cost could increase further. In addition, the depressed timber market has reduced the anticipated revenue from timber sales during the demonstrations of the project by 54 percent. Problems in designing and building the aircraft have caused delays and raised concerns about the strength of the structure of the vehicle. There has been dissatisfaction with the quality of the contractor's workmanship. Within the last year, the contractor has changed the delivery date five times, providing little confidence in the validity of the current completion date. Potential users of the vehicle, contacted by GAO in a previous review, saw little opportunity for the aircraft's use and rated the concept poor as a timber harvesting method. The successful completion of this project will not result in a fleet of aircraft, it will only demonstrate the concept. Another development program will be necessary to develop a vehicle that can be produced and sold to logging companies. GAO believes that it is unlikely that potential users will fund the cost of this follow-on program. With the present reduced demand for timber, GAO believes that it is questionable that the costly logging of inaccessible timber areas is justified.