Summary

Pursuant to a congressional request, GAO provided cost, schedule, and contractor performance information on two Air Force contracts for research and development (R&D) of a ground power generator system, focusing on allegations that the Air Force proceeded with production of the system with one of the original contractors even though the R&D results were not satisfactory.

GAO found that: (1) the final costs of the R&D contracts totalled about $26.3 million, including net price increases of about $431,000 for engineering charges; (2) one contractor also had a $1.7-million claim pending with the Air Force; (3) although setbacks which resulted in schedule revisions occurred at various stages of development and testing, they were unrelated to contractor performance problems; (4) both contractors met various technical requirements in some instances, and not in others; and (5) there was no basis for the allegations against the production contract award, since the Air Force reasonably considered performance under the R&D contracts in making its decision and did not violate any procurement statutes or regulations.