Summary

During the past decade, the Pentagon has spent more than $5 billion on a satellite system (the Milstar program) to provide the President and the military with global communications in the event of a nuclear war. Because of congressional concerns about the program, the Defense Department (DOD) has scaled back the number of satellites and terminals. But DOD's plans to modify the Milstar satellite design are not the most cost and operationally effective alternatives for satisfying tactical communication needs. GAO believes that this matter and three technical issues--sufficient capacity, assured connectivity, and the ability of antennas to neutralize the effects of electronic jammers--must be resolved. DOD can save up to $441 million by canceling planned procurement of one kind of Army Milstar terminal and selecting one contractor to finish producing the Air Force's command post terminals. DOD oversight of the Air Force's so-called low cost terminal program is critical, considering the risks involved, and separate criteria for exiting the demonstration and validation phase and engineering and manufacturing development phase of the acquisition process are essential. Caution is necessary regarding continued production of the Navy's Milstar terminals because of conflicts associated with reliability testing and production contract limitations.

GAO found that: (1) the Department of Defense's (DOD) plan to restructure the Milstar satellite program was not the most effective alternative to meet current defense communication requirements; (2) the benefits of procuring Army Single Channel Objective Tactical Terminals (SCOTT) are questionable, and DOD may be able to substitute lower cost small, mobile, anti-jam, tactical terminals (SMART-T) for any remaining Milstar requirements; (3) DOD must resolve three issues regarding further development of the Milstar program involving sufficient capacity, assured connectivity, and special antennas capable of neutralizing the effects of electronic jammers; (4) DOD could save $441 million by cancelling SCOTT and selecting one contractor to finish producing Air Force terminals; (5) the Navy Milstar terminal program is in low rate initial production and is experiencing continuing reliability problems; (6) Navy Milstar procurement costs could rise due to the Navy's minimum contract obligations; and (7) since Milstar is no longer highly classified, DOD should submit Milstar selected acquisition reports to Congress.