NARA's spending plan for electronic archive isn't reliable, GAO says

The National Archives and Records Administration's plan for spending $86 million to finish the current phase of its troubled Electronic Records Archives is unreliable and incomplete, according to a new report.

The Government Accountability Office report said problems continue to grow for the ERA program. Previous GAO reports have detailed major schedule delays and cost overruns, and the Office of Management and Budget said new development for the digital archive would end by Sept. 30.

In October 2010, NARA submitted a fiscal 2011 expenditure plan to support its request for $86 million for the project, according to the latest GAO report.

However, GAO auditors determined that although the plan satisfies four of the six conditions requested by Congress, it does not provide a reliable basis for spending the additional funds.

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“Specifically, NARA’s plan does not clearly show what functions have been delivered to date or how actual costs compare to planned costs,” GAO auditors wrote. “Further, even though NARA plans to end development in fiscal year 2011, the fiscal year 2011 expenditure plan does not clearly show what functionality is planned to be delivered, by when, and at what cost during this period.”

In addition, NARA’s cost estimates are shaky because of weaknesses in the supporting methodology, including too much reliance on contractor estimates and untraceable and unvalidated data, GAO auditors said.

Finally, NARA did not include a plan to guide spending of $20 million in accumulated multi-year funds for the project dating from fiscal 2010. The agency needs to specify how it will use those funds before lawmakers can evaluate the fiscal 2011 request, GAO auditors said.

The report is the latest in a series of critical assessments of the 10-year-old program. NARA awarded a contract to Lockheed Martin in 2005 to provide a permanent archive for digitized official records, with initial operating capability achieved in December 2008. The ERA project was originally projected to cost about $500 million, but GAO said recently the cost could rise as high as $1.4 billion.

“With significant weaknesses in many basic oversight and management processes, as well as continued delays in completing Increment 3, NARA’s ability to make significant development progress in the remainder of the fiscal year will be challenged,” GAO auditors wrote. “With OMB's direction to stop development after 2011, it is unclear whether NARA will be able to effectively address the full range of weaknesses we identified and still have adequate time to complete significant development efforts.”

GAO suggested that Congress consider limiting NARA’s ability to use appropriated funds for ERA until officials implement an adequate capital planning and investment control process.

GAO made the following recommendations to NARA:

• Report to Congress on the specific outcomes to be achieved with the $20 million balance in multi-year funding in fiscal 2011.
• Ensure that the ERA requirements planned for fiscal 2011 are fully prioritized.
• Ensure that significant changes to the project's cost, schedule and scope are approved through NARA’s review process.
• Conduct post-implementation reviews to validate estimated benefits and costs.
• Submit expenditure plans to OMB for review and approval before submitting them to Congress.
• Update the ERA Requirements Management Plan and related guidance to mandate prioritization of requirements throughout the project’s life cycle.

NARA officials agreed with the recommendations. However, they noted that the last four recommendations apply only to future-year funding for the project and not to fiscal 2011.