Space Force acquisition czar wraps program ‘scorecard,’ puts floundering contractors on notice

WASHINGTON — Frank Calvelli, the official in charge of herding space acquisition for the Department of the Air Force, has issued his first “scorecard” on program performance, Breaking Defense has learned — with five programs on the bottom rung and struggling to stay abreast of their requirements.

Calvelli “recently delivered an Annual Acquisitions Report” to Air Force Secretary Frank Kendall “with a summary of the cost, schedule, and technical performance of multiple Space Force acquisition programs,” a Space Force spokesperson said in an email.

The scorecard is an internal document, and will not be released to Congress or the public as it “contains assessments of the classic cost, schedule, and technical performance of programs,” the spokesperson added.

Calvelli, in his own statement, said, “The intent of the report was to provide a portfolio-level overview on Space Force programs and track year-over-year changes in the number of programs meeting their cost, schedule, and technical performance commitments. Looking at the data, there is more work to be done to meet the desired cost and schedule results, and we continue to drive program management discipline in line with my nine acquisition tenets and simple formula for going fast in space acquisition.”

The report, one senior Space Force official told Breaking Defense, includes five programs in the “red” category on the card, signifying that they are floundering, though the official did not identify the specific programs. The scorecard concept, first reported by Breaking Defense last fall, uses a stoplight-type system for grading acquisition programs in hopes of pinpointing which ones need attention to get them back on track and encourage program executive officers to take remedial actions.

Ultimately, the report could trigger a decision by Calvelli to terminate a program or dump an underperforming contractor.

In a public report last October covering 2021 Air Force and Space Force acquisition performance issued by Andrew Hunter, assistant secretary of the Air Force for acquisition, technology and logistics, a handful of space programs were listed as failing to meet cost and/or schedule metrics. These included the Global Positioning System III satellites, and their long-troubled ground system called the Next Generation Operational Control System, or OCX for short, being developed by Raytheon Technologies.

As the assistant secretary of the Air Force for space acquisitions and integration, Calvelli serves as the first-ever Department of the Air Force space acquisition executive (SAE). His post was created by Congress in order to overhaul the sclerotic bureaucracy and processes that have been weighing down the acquisition of space systems for decades, resulting in massively expensive systems often plagued by cost and schedule overruns. As SAE, he controls the Pentagon’s key space acquisition agencies: Space Systems Command (SSC) and its five related “program executive offices” for various baskets of missions; the Space Rapid Capabilities Office; and the Space Development Agency.

Since he took up that position in March 2022, Calvelli has been warning his space acquisition community, including contractors, that a record of poor performance would lead to consequences — all the way up to terminating a program.

Speaking at a Space Force Association event on April 14, Calvelli explained that there is no reason why the Space force has to stick with failing contractors.

“If you hire a general contractor to come to your house and they do a bad job, typically you’re not going to hire them again… There’s lots of new companies coming online, lots of fantastic companies out there. So we shouldn’t keep going back and forth to poor performers.”

One of his nine tenets, issued last October, reads: “Hold industry accountable for results. Do not tolerate bad performance that we have seen in some traditional large satellite and ground systems cost-plus contracts. Take corrective action and consider all tools available for poor performers including loss of fee, use of the Contractor Responsibility Watch List, and if necessary, stopping programs. Industry works for you, so be a demanding customer.”

The Contractor Responsibility Watch List (CRWL) was pioneered by the National Reconnaissance Office that is responsible for building and operating US spy satellites. It sets out extra oversight measures for contractors with a track record of poor performance. According to a declassified NRO memo from October 2019 [PDF]: “This is not a ‘no-buy’ list, but rather an internal performance-based watch list. Additional processes are required for companies on the CRWL to be considered for other contracts.”

“Typically, at the NRO when somebody didn’t perform, we would put them on the [list] and we would notify Congress and all the committees that they weren’t performing as well. And we’re taking a similar approach in the department,” Calvelli, who served in senior roles at the NRO, told the National Security Space Association’s Defense and Intelligence Space Conference on Jan. 24. “I’m going to be honest, I don’t know how often we’ve used it in the past, but we’re stepping up our game now.”

Space Systems Command on March 8, 2022 issued its own, mandatory “instruction” document to program executive officers with their hands on the funding reins to implement the use of CRWL for its space acquisition programs [PDF]. Creation of a service CRWL was mandated in the fiscal 2018 National Defense Acquisition Act.

It includes, among other things, a provision that prohibits contracting officials to “solicit sole source offers from, award competitive or sole source contracts to, execute engineering change proposals with, or exercise options on any space program contract with a contractor included on the CRWL without prior approval” of SSC chief Lt. Gen. Michael Guetlein.

Further, the instructions explain, that contracting officers can decide not to make awards to a listed contractor, and any decision to proceed with an award must first be approved by Guetlein.

“All competitive solicitations shall include a requirement for each prospective contractor or subcontractor proposed for an applicable subcontract that is listed on the CRWL to submit documentation with their proposal to the Government describing how they have addressed the conditions that resulted in their inclusion on the CRWL and why those conditions will not impact performance on a resultant space program contract,” the instruction states.

In addition, prime contractors have to get SSC contracting office consent to subcontract with a CRWL-listed vendor prior to making any awards “valued in excess of $3,000,000 or five percent of the prime contract value, whichever is lesser.”