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Unmanned Aerial Vehicles: No More Hunter Systems Should Be Bought Unit Until Problems Are Fixed (Letter Report, 03/01/95, GAO/NSIAD-95-52).


GAO reviewed the Department of Defense's (DOD) acquisition of the Hunter
Short-Range Unmanned Aerial Vehicle (UAV), focusing on whether: (1) the
system is logistically supportable; (2) previously identified
performance deficiencies have been corrected; and (3) the system
represents a valid joint-service effort.

GAO found that: (1) the Hunter UAV system is not logistically
supportable and has serious unresolved performance deficiencies; (2) the
contractor had not delivered required logistical support information as
of December 1994; (3) the system may be unsuitable for theater
operations and may require costly contractor maintenance and support;
(4) the vehicle is currently grounded because of a number of crashes
during testing; (5) DOD plans to go into full production before
determining whether the land-based vehicle is suitable for naval
operations, which jeopardizes the joint-service system; (6) although DOD
recently restructured the Hunter program, the program faces further
delays and curtailment of critical testing while allowing for the
procurement of defective systems; and (7) the planned award of a second
low-rate production contract will have a minimal effect on preserving
the contractor's skilled labor pool.

--------------------------- Indexing Terms -----------------------------

 REPORTNUM:  NSIAD-95-52
     TITLE:  Unmanned Aerial Vehicles: No More Hunter Systems Should Be 
             Bought Unit Until Problems Are Fixed
      DATE:  03/01/95
   SUBJECT:  Defense procurement
             Product performance evaluation
             Logistics
             Manufacturing contracts
             Advanced weapons systems
             Systems evaluation
             Military operations
             Testing
             Electronic warfare
             Military cost control
IDENTIFIER:  Short Range Unmanned Aerial Vehicle
             Pioneer Unmanned Aerial Vehicle
             SLQ-32 Electronic Warfare System
             
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Cover
================================================================ COVER


Report to the Secretary of Defense

March 1995

UNMANNED AERIAL VEHICLES - NO MORE
HUNTER SYSTEMS SHOULD BE BOUGHT
UNTIL PROBLEMS ARE FIXED

GAO/NSIAD-95-52

Unmanned Aerial Vehicles


Abbreviations
=============================================================== ABBREV

  DAB - Defense Acquisition Board
  DOD - Department of Defense
  GAO - General Accounting Office
  LRIP - low-rate initial production
  UAV - Unmanned Aerial Vehicle

Letter
=============================================================== LETTER


B-259256

March 1, 1995

The Honorable William J.  Perry
The Secretary of Defense

Dear Mr.  Secretary: 

The Department of Defense (DOD) is acquiring the Hunter Short-Range
Unmanned Aerial Vehicle (UAV) for use by the Army, the Navy, and the
Marine Corps at an estimated cost of over $4 billion.  We reviewed
the Hunter program to determine (1) whether it has been demonstrated
to be logistically supportable, (2) whether its performance
deficiencies found in prior testing have been resolved, and (3)
whether it represents a valid joint-service effort as mandated by
Congress. 


   BACKGROUND
------------------------------------------------------------ Letter :1

The Hunter is a pilotless aircraft resembling a small airplane that
is controlled from a ground station.  (See fig.  1.) It is intended
to perform reconnaissance, target acquisition, and other military
missions by flying over enemy territory and transmitting video
imagery back to ground stations for use by military commanders. 

The Hunter program (formerly called the Short-Range UAV program)
began in 1989 as a joint-service effort in response to congressional
concern over the proliferation of UAVs by the different services and
the need to acquire UAVs that could meet the requirements of more
than one service.  DOD started the program by procuring two candidate
systems for competitive testing.  In early 1993, after the Hunter was
selected as the winning system, DOD approved its low-rate initial
production of seven systems and awarded a $171- million contract. 

<photo2x:FIG1.EPS>Figure 1:  Hunter UAV:  Wingspan 29' Length 23'

Each system includes eight UAVs with payloads, a launch and recovery
station, ground stations for controlling flight and processing
information from the UAVs, and other related equipment.  (See fig. 
2.) DOD plans to buy 24 systems for the Army, 18 for the Navy, 5 for
the Marine Corps, and 3 for training, for a total of 50 systems. 

   Figure 2:  Hunter UAV System

   (See figure in printed
   edition.)


   RESULTS IN BRIEF
------------------------------------------------------------ Letter :2

To date, the Hunter UAV system has shown itself to be logistically
unsupportable, and tests have identified serious performance problems
that adversely impact the system's effectiveness.  Based on its
performance to date, the system may prove unsuitable for use by
operational forces and, contrary to DOD plans, could require costly
contractor maintenance and support to keep it operating. 
Furthermore, after several crashes during testing, the Hunter UAV
system was ordered grounded by DOD and has remained grounded. 
Nevertheless, DOD plans to commit to full-rate production for the
land-based configuration before determining whether the Hunter UAV
can meet Navy requirements, thus putting a single joint-service
system, as called for by Congress, at risk. 

DOD has recently restructured the Hunter program in an effort to
address the system's problems.  However, the restructured program
would further delay and curtail critical testing while allowing for
additional procurement of systems whose performance is so far
unproven and possibly defective.  According to DOD, award of a second
low-rate production contract is needed to avoid a prolonged
production break.  However, award of a second low-rate production
contract would not eliminate the production break.  In view of this
and because of the risks in further committing to an unproven system,
we believe that further production should be deferred until the
system demonstrates satisfactory performance. 


   HUNTER SYSTEM IS NOT
   SUPPORTABLE
------------------------------------------------------------ Letter :3

DOD Instruction 5000.2 requires that efforts to develop a system's
logistical supportability begin early in the acquisition process to
assure that it can be successfully operated and maintained when
deployed.  These efforts include developing the proper procedures for
maintaining the system and for training military personnel to operate
and repair the system.  Accordingly, the contract for the Hunter UAV
system required that the contractor develop logistic support
information and deliver it when the low-rate production contract
option was awarded in February 1993. 

Such logistic support information is supposed to identify and
document (1) functions that personnel must perform to operate and
maintain a system in its operational environment; (2) the types of
military personnel, such as air vehicle pilots and maintenance
technicians, best suited to perform the operations and maintenance
functions; (3) all training, including training curriculums and
training materials, required to prepare personnel to operate and
maintain the system; (4) all equipment required to maintain the
system, such as mechanical tools used to repair trucks, and computer
hardware and software used to test and repair faulty electronic
equipment; and (5) the system maintenance schedule.\1

As of December 1994, the contractor had not delivered adequate
logistic support information.  In 1993, the Joint Tactical UAV
Project Office conducted a logistics demonstration to evaluate the
adequacy of the logistic support information provided by the
contractor.  For the logistics demonstration, the contractor trained
military personnel to conduct system maintenance and developed system
manuals describing 3,107 maintenance tasks.  The trained military
personnel attempted all of the maintenance tasks, but they completed
only 56 maintenance tasks on the first attempt.  After government
analysis, and extensive revisions by the contractor, military
personnel were able to complete 1,526 more tasks.  Government testers
informed us that 1,347 of the 3,107 maintenance tasks were so
ill-defined in the contractor-supplied manuals that revisions were
not practical. 

In a letter dated January 1994 to the contractor, the Hunter
contracting officer stated that the results of the logistic
demonstration reflected a system that was not yet sustainable and did
not have a support structure in place.  The contracting officer
identified logistic support information as the primary area of
deficiency.  He informed the contractor that the system manuals were
grossly inadequate to either operate or maintain the system and that
the training curriculum was insufficiently defined.  According to the
logistics demonstration final report, the system manuals contained
insufficient references, incorrect or vague cautions and warnings,
and conflicting equipment terminology.  The testers concluded that
these deficiencies caused the manuals to be difficult to use and
error prone and that the system manuals could lead to equipment
damage and injury to personnel. 

The Joint Tactical UAV Project Office revised the contract delivery
schedule to allow additional time for the contractor to deliver
adequate logistic support information.  The revised schedule delayed
the delivery of logistic support information from February 1993 until
October 1994 for unit maintenance and until June 1995 for depot
maintenance.  Analysts at the U.S.  Army Missile Command, the Hunter
program's lead logistics agency, reviewed all available logistic
support information in May 1994.  They concluded that, based on the
contractor's past history of not developing logistic support
information in accordance with DOD policy and the sheer magnitude of
the work remaining, the contractor would not be able to provide
complete logistic support information before June 1995. 

Missile Command logistics analysts said that without adequate
logistic support information, DOD would have to rely on the
contractor for logistic support.  Based on DOD's experience with
other programs, Missile Command officials expect contractor logistic
support to be more expensive than the support originally planned to
be provided by the services.  For example, government cost estimates
of service-provided operations and maintenance for a Hunter system
was set at $2.9 million a year for peace-time operations.  However,
the contractor has already proposed billing the government about $1.7
million to provide logistic support for one system for 300 flight
hours in a 3-month operational exercise.  This equates to about
$5,666 per flight hour and $6.8 million a year for one system. 

As we have seen on other systems such as the Pioneer UAV and the
SLQ-32 shipboard electronic warfare system, insufficient logistic
support information can also lower system readiness.  For example,
the Pioneer's readiness has been degraded because faulty maintenance
manuals caused maintenance personnel to order the wrong replacement
parts, and logistics assessment reports on the SLQ-32 show that
inadequate technical manuals increased operations costs and lowered
readiness levels.\2


--------------------
\1 The maintenance schedule should point out how often items such as
air filters, oil filters, and spark plugs should be replaced in all
the air vehicle engines. 

\2 Electronic Warfare:  Inadequate Testing Led to Faulty SLQ-32s on
Ships (GAO/NSIAD-93-272, Aug.  19, 1993). 


   HUNTER'S PERFORMANCE PROBLEMS
   HAVE NOT BEEN RESOLVED
------------------------------------------------------------ Letter :4

DOD policy requires that operational test and evaluation be
structured to determine (1) the operational effectiveness and
suitability of a system under realistic combat conditions and (2)
whether the minimum acceptable operational performance requirements
have been satisfied. 

As stated in our December 1993 report,\3 results of the limited user
testing conducted during 1992 revealed significant performance
deficiencies in the Hunter system.  While some actions have been
taken or are planned that are designed to correct problems, our
review indicates that serious deficiencies remain unresolved.  We
also found that none of the fixes had been operationally tested to
ensure that the system meets minimum acceptable operational
requirements.  In addition, acceptance testing on the first low-rate
production system, which began in May 1994, disclosed new problems. 
As of October 1994, the delivered system had not been accepted. 
Furthermore, during acceptance testing in late October 1994, an air
vehicle was almost totally destroyed when it went out of control. 
Consequently, DOD grounded the Hunter system. 


--------------------
\3 Unmanned Aerial Vehicles:  Performance of Short-Range System Still
in Question (GAO/NSIAD-94-65, Dec.  15, 1993). 


      HUNTER SYSTEM'S RELIABILITY
      HAS NOT BEEN DEMONSTRATED
---------------------------------------------------------- Letter :4.1

Limited user testing conducted in 1992 showed that the Hunter system
was unreliable in several critical areas.  The system required
frequent unanticipated repairs, the air vehicle engine performance
was unsatisfactory, and the built-in-test equipment was inadequate. 
These problems have yet to be resolved. 


         UNANTICIPATED REPAIRS
-------------------------------------------------------- Letter :4.1.1

To ensure that the Hunter is reliable and does not create an
excessive maintenance burden, system requirements specify that it
require no more than one unanticipated repair every 4 hours. 
However, limited user tests showed that the Hunter required
unanticipated repairs every 1.2 hours.  DOD acknowledges that the
system failed to meet this requirement but has taken no further
action to demonstrate that the system can perform as required. 
Instead, DOD has relied on contractor estimates, which state that the
requirement for unanticipated repairs is achievable. 

The importance of system reliability was demonstrated during
Operation Desert Storm.  According to DOD's lessons learned, the
frequent failure of the Pioneer showed that UAV systems must be
reliable to adequately support combat operations. 


         AIR VEHICLE ENGINE
-------------------------------------------------------- Letter :4.1.2

Limited user tests conducted in June 1992 disclosed that the two
engines used in each air vehicle, which were designed for a
motorcycle, were particularly unreliable and had a short life.  The
engines experienced recurring problems with valve seizures.  Because
of the repeated engine failures during testing, the project manager
directed the contractor to replace all engines with modified
versions.  Although the purchase price of the motorcycle is under
$8,000, DOD has contracted not-to-exceed prices as high as $53,000
each for the engines.  The replacements showed some improvements,
however, failures continued.  Army test officials concluded that each
UAV unit equipped with 2 Hunter systems could be required to replace
from 3 to 10 engines a week.  Furthermore, the frequent engine
replacements could overburden the services' logistics systems. 

According to program officials, these engine problems have been
corrected and the original systems procured have been retrofitted
with the changes.  Program officials also plan to incorporate the
modifications in the systems being produced.  Program officials also
said the air vehicle engines demonstrated acceptable performance
during subsequent verification testing.  However, valve seizures
reappeared during more recent testing.  In fact, during July 1994,
while testing the first low-rate production system delivered, the
problems with push rods and valve seizures continued.  Test officials
have refused to accept delivery of this system until these problems
are resolved.  In addition, at least two earlier crashes, which
resulted in significant damage to the air vehicles, have been
partially attributed to other engine-related failures. 


         BUILT-IN-TEST EQUIPMENT
-------------------------------------------------------- Letter :4.1.3

Hunter's built-in-test is supposed to identify system faults needing
repair.  However, following limited user testing, test officials
concluded that the built-in-test equipment consistently failed to
meet requirements and required redesign to correct the deficiencies. 
The built-in-test detected only 11 of 154 problems during the tests
and isolated the cause of only 2 of the 11 faults detected.  The test
agency concluded that the inadequate built-in- test design
significantly hampered system maintenance and increased the time to
correct problems. 

In 1993, logistics demonstration testing disclosed that while some
software modifications had been made, Hunter's built-in-test
equipment still did not meet requirements.  Currently, DOD plans no
further testing of the Hunter built-in-test equipment until February
1995. 


      SYSTEM ABILITY TO MEET RELAY
      REQUIREMENTS REMAINS
      QUESTIONABLE
---------------------------------------------------------- Letter :4.2

Most Army and Marine Corps units planning to use the Hunter need UAVs
that operate at ranges greater than that at which the ground station
can directly control the Hunter.  DOD plans to extend the range of
the Hunter through a process called "relay operations." Relay
operations involve controlling one UAV at long range through a second
UAV operating at a closer range, as shown in figure 3.  Establishing
a relay is to be accomplished by the ground station transmitting
commands to and receiving video imagery from the air vehicle
operating at long ranges through relay equipment on the UAV operating
at a closer range. 

<photo2x:FIG3.EPS>Figure 3:  Hunter UAV Relay Operations

Most of the limited user tests planned to demonstrate this capability
failed because of engine failures or other problems with the air
vehicle and relay component.  The test agency concluded that the
system's ability to transmit video imagery during relay operations
was unacceptable for a fielded system.  DOD has incorporated some
modifications intended to improve the system's relay capability and
overcome past poor video quality.  However, according to an official
of the Defense Contract Management Command, subsequent testing has
determined that the quality of the video imagery from the low-rate
production system that has been delivered, but not accepted, is worse
than that demonstrated during the limited user tests.  The contractor
has replaced system components in an attempt to solve the problem. 
However, the adequacy of the changes has not been verified in flight
testing because the system has remained grounded. 


      SYSTEM ABILITY TO SUPPORT
      ARTILLERY OPERATIONS HAS NOT
      BEEN MET
---------------------------------------------------------- Letter :4.3

The Hunter system is supposed to locate and identify targets so that
they can be engaged by artillery fire.  The system is also expected
to detect where artillery lands in relation to the target so that the
artillery can be adjusted.  To be effective, these tasks must be done
quickly so that the targets can be hit before they are able to take
cover or move. 

During the limited user tests conducted in 1992, the Hunter failed to
meet requirements.  Army testers concluded that the system was not
sufficiently timely and may never meet Army standards.  Even though
the system demonstrated unsatisfactory performance during the 1992
testing, DOD's current plans do not include any corrective action to
resolve this deficiency.  DOD officials stated that this is because
the system operational requirements documents do not establish
specific time frames in which the Hunter must be able to support
artillery operations. 

However, the mission needs statement that justified procurement of
the Hunter states that the system is intended to acquire targets that
would then be engaged by artillery or other means.  We believe that a
requirement to adjust artillery fire in a timely fashion is inherent
in missions whose objective is to engage targets. 


      ACCEPTANCE TESTING REVEALS
      NEW DEFICIENCIES
---------------------------------------------------------- Letter :4.4

The Defense Contract Management Command is responsible for accepting
delivery of the system hardware and began acceptance testing of the
first low-rate production system in May 1994.  On June 14, 1994, the
Command recommended that the UAV program office terminate acceptance
testing because extensive software changes were needed and the air
vehicle flew in a circle even when programmed for straight and level
flight.  Acceptance testers also noted that air vehicle engines
continue to have valve seizures.  However, the Joint Tactical UAV
Project Office ignored the recommendation and acceptance testing
continued. 

In July 1994, the Command reported to the UAV program office that
several problems needed to be resolved prior to system acceptance. 
The Command identified software as the most critical problem with the
system and pointed out that the existing software was not acceptable
for field use.  In addition, test results continued to show that the
air vehicles pulled to the left during takeoff and flight.  On some
air vehicles, this condition was severe and could affect safety of
flight.  Therefore, tests of the system's speed and altitude
capability were performed by flying the air vehicle in a circle; the
air vehicle could not meet contractual requirements when it was
flying straight and level.  DOD officials believe that subsequent
system modifications have resolved this problem.  However, the
adequacy of the modifications has not been fully tested because the
system remains grounded.  The acceptance testing of the first
low-rate production system delivered also showed a significant
increase in the loss of data link connections between the ground
station and the air vehicle when compared to the results of the 1992
limited user test. 


   GOAL OF JOINT-SERVICE SYSTEM IS
   AT RISK
------------------------------------------------------------ Letter :5

DOD currently plans to begin full-rate production of the Hunter
system for the Army and the Marine Corps before verifying that the
system will meet the Navy's needs.  If subsequent testing of a Navy
version of the Hunter were to show the system to be unsuitable for
naval use, DOD would already be fully committed to a system that did
not meet the need of all services, as called for by Congress.  As a
result, the congressional call for DOD to develop a joint-service
system is at risk. 

Although DOD plans call for operational testing before full-rate
production, the testing will not include an evaluation of the
system's ability to meet the Navy's operational requirements. 
Operational testing of the Navy requirements is not scheduled until
after DOD plans to commit to full-rate production of the land-based
Hunter.  According to the Commanding General of U.S.  Army
Operational Test and Evaluation Command, the DOD Director of
Operational Test and Evaluation has expressed concern that the
operational testing of the Navy variant will not occur until after
the full-rate production decision for the land-based system. 

Hunter program officials maintain that the contractor showed that the
Hunter can be operated from a ship during a maritime demonstration. 
However, according to a Navy official, this demonstration did not
reflect realistic operational conditions.  For example, during the
shipboard demonstration, the contractor removed all aircraft from the
flight deck.  According to the Navy official, under realistic
conditions, other aircraft would remain on the deck of the ship
during operation of the Hunter system.  In addition, there have been
at least five air vehicle crashes involving the tail hook recovery
system that would be used to land the Hunter aboard ship. 


   RESTRUCTURED PROGRAM INCREASES
   RISK
------------------------------------------------------------ Letter :6

Under the Defense Acquisition Board (DAB) approved program schedule
(see fig.  4), DOD has seven systems under contract with deliveries
scheduled through April 1995 and operational testing from November
1994 to May 1995.  This schedule allows a 23-month break, from April
1995 to March 1997, in the delivery of UAV systems.  The UAV Joint
Project Office asserts that it must award a second low-rate
production contract for four additional systems to reduce the
23-month break in production deliveries and keep skilled contractor
employees on the job. 

However, as indicated in figure 5, the level of contractor employees
will still be significantly reduced even with the additional
production because the second production contract award is not
anticipated to be made before June 1995.  Furthermore, a sizable
break in production deliveries of over one year would still exist. 
Therefore, the impact of a second procurement on labor force
stability would be marginal at best because at that point in time
less than 50 employees would be retained.  In addition, not awarding
the second production contract reduces the risk from further
commitment to a potentially unsuitable system. 

   Figure 5:  UAV Joint Projects
   Office Proposed Program
   Schedule With Second Low-Rate
   Production Contract

   (See figure in printed
   edition.)


   RECOMMENDATION
------------------------------------------------------------ Letter :7

We recommend that the Secretary of Defense prohibit award of a second
low-rate production contract until the Hunter system satisfactorily
demonstrates that it is operationally effective and operationally
suitable and will satisfactorily meet the requirements of the Army,
the Marine Corps, and the Navy. 


   AGENCY COMMENTS AND OUR
   EVALUATION
------------------------------------------------------------ Letter :8

We did not obtain written agency comments on this report.  However,
we discussed its contents with officials from the Office of the
Secretary of Defense, the Assistant Secretary of the Navy, the
Defense Airborne Reconnaissance Office, the UAV Joint Project Office,
and the Joint Tactical UAV Program Office and incorporated their
comments as appropriate.  The officials maintained that award of a
second low-rate production contract is warranted to prevent a
prolonged break in production deliveries and retain skilled
contractor employees. 

Our review indicated that even with a second production contract, a
significant break in production deliveries and a significant
reduction in contractor employees would still occur.  Because of the
risks involved in further committing to an unproven system, we
believe that further production should be deferred until the system
demonstrates that its problems are solved and its performance is
satisfactory. 

The officials pointed out that operational testing of the Navy
variant is to be done before a commitment is made to its production. 
By that time, however, DOD will have already made the full-rate
production decision on the Army and the Marine Corps version
jeopardizing the goal of a common-service system. 


   SCOPE AND METHODOLOGY
------------------------------------------------------------ Letter :9

To accomplish our objectives, we focused primarily on the results of
system testing, including logistics and shipboard demonstrations and
limited user testing.  We also examined the results of technical
tests that assessed some other aspects of the system's performance. 
In addition, we reviewed (1) test plans and schedules, (2)
performance requirements documents, (3) acquisition plans, (4) the
original contract and all modifications, and (5) other records
bearing on the Hunter UAV status and potential suitability and
effectiveness. 

We obtained information from officials of the Program Executive
Office for Cruise Missiles and UAV Joint Project Office, Naval Air
Systems Command, Arlington, Va.; Hunter Joint Tactical UAV Program
Office and Integrated Material Management Center, U.S.  Army Missile
Command, Huntsville, Ala.; U.S.  Army Training and Doctrine Command,
Fort Huachuca, Ariz.; DOD Contract Management Command, Sierra Vista,
Ariz.; Marine Corps Combat Development Command, Quantico, Va., and
1st Remotely Piloted Vehicle Company, Twenty-Nine Palms, Calif.;
Aviation Requirements Branch, Commander, Naval Surface Forces
Atlantic, Norfolk, Va.; and Weapons Support Improvement Group,
Assistant Secretary of Defense for Production and Logistics, Office
of the Secretary of Defense, Washington, D.C. 

We performed our work from October 1993 to November 1994 in
accordance with generally accepted government auditing standards. 


---------------------------------------------------------- Letter :9.1

As you know, 31 U.S.C.  720 requires the head of a federal agency to
submit a written statement on actions taken on our recommendations to
the Senate Committee on Governmental Affairs and the House Committee
on Government Reform and Oversight not later than 60 days after the
date of the report.  A written statement must also be submitted to
the Senate and House Committees on Appropriations with an agency's
first request for appropriations made more than 60 days after the
date of the report. 

We are sending copies of this report to appropriate congressional
committees; the Secretaries of the Army and the Navy; and the
Director, Office of Management and Budget.  We will make copies

Please contact me at (202) 512-4841 if you or your staff have any
questions concerning this report.  Major contributors to this report
were Jack Guin, Assistant Director; Pam Greenleaf,
Evaluator-in-Charge; John S.  Warren, Evaluator; and Charles A. 
Ward, Evaluator. 

Sincerely yours,

Louis J.  Rodrigues
Director, Systems Development
 and Production Issues