FAA threatens prime with pact termination

The Federal Aviation Administration is threatening to terminate the $475 million Wide-Area Augmentation System (WAAS) contract if prime contractor Wilcox Electric Inc. does not correct specified deficiencies in the program.

In a March 18 "cure" letter sent to Wilcox, the FAA spelled out 10 areas in which the company "has failed to make progress and has also failed to meet other contractual provisions," which could be grounds to terminate the WAAS contract, the FAA said. Wilcox has until April 2 to respond to the letter.

Under WAAS, awarded last summer, Wilcox will build a series of ground-based systems to allow aircraft to use the Global Positioning System for en route navigation and precision landing. Wilcox is teamed with Hughes Aircraft Co. and TRW Inc. on the program.

Although WAAS recently passed a major system-design review, Wilcox does not appear to have a good measure of how much it will cost to complete the program, said George Donohue, associate administrator for research and acquisition.

"We don't have any concern about the ability of the system to work," he said. "Our major concern is in a number of managerial areas...manifested by schedule and cost deficiencies that have not been improving over the last eight months."

Among other issues, Wilcox has failed to establish a performance measurement baseline, which spells out how it plans to proceed with WAAS development and to provide accurate cost and schedule status reports. Wilcox also has failed to settle on the WAAS hardware infrastructure, according to the letter.

Wilcox said in a statement last week, "The WAAS team expects to fully answer all the FAA's questions and remains confident of its ability to deliver a WAAS system that meets all of the FAA's requirements."

The FAA still believes much of WAAS can be complete by 2000—with only "reasonable slips" in the schedule for near-term milestones—if Wilcox takes appropriate action, Donohue said.

However, the FAA has not announced how it would proceed with WAAS if it terminates the Wilcox contract. The agency has paid only for "hard deliverables," so "we have been preserving our resources and our options," Donohue said.

The FAA negotiated the WAAS contract with the Wilcox team after determining that it submitted the only technical proposal that was in the competitive range. However, language in this year's authorization bill freed the FAA to run its own procurement system.

Under the new procurement system unveiled last week, "we have quite a bit of flexibility in the precontract award phase that we just didn't have under the [Federal Acquisition Regulations]," under which the WAAS contract was awarded, Donohue said.

The FAA also is developing a program called the National Satellite Test Bed, an alternative satellite-based navigation system under development at the FAA Technical Center. However, NSTB would require a significant amount of work before it could be used as a primary navigation system, as intended with WAAS, Donohue said.

The Air Transport Association, which represents national air carriers, has lobbied for NSTB before the House Committee on Appropriations.

"We've suggested the FAA can accomplish what it wants without WAAS" and at a fraction of the cost, an ATA spokesman said.