KSC Learns about Government Accounting
While KSC was wrestling with the protracted checkout of Apollo 4, its top management had to divert considerable attention to a U.S. General Accounting Office (GAO) audit that had started two years before and now reached a climax. Back in the spring of 1965, while KSC was still in the process of readying launch complex 39, the GAO began an audit of the contract for a second crawler-transporter. It wanted written studies substantiating the need for two vehicles. Close to five months after beginning its audit, the GAO informed KSC Director Debus that the evidence had "thus far eluded" it.37 Debus replied on 15 October 1965 that such documentation did not exist - a surprising fact in view of the detailed documentation of almost every activity at the Cape. Debus pointed out that a second crawler was critical to the unit's performance because of the possibility of a breakdown, and that NASA had informed Congress and the Bureau of the Budget of its plans to purchase two transporters.38
Six months later, on 14 April 1966, the GAO notified Debus of its plans to examine other duplicate facilities on LC-39. Stanley Dyal, the auditor-in-charge, met with KSC officials and toured LC-39. On 6 July the GAO asked Debus about the decision to construct mobile facilities for six launches a year, in view of NASA and contractor studies that showed the mobile concept to be more economical only above a rate of 12-18 launches a year. Since NASA Headquarters had made the decisions the GAO questioned, Debus referred the letter to Washington. On 16 August 1966, Associate Administrator Mueller replied to the GAO, pointing to the presidential declaration on space of 1961 and the desire for sufficient flexibility to meet future needs, and adding that complete documentation of all studies, analyses, and conferences was not available.39
After a visit to KSC in late August 1966, the Associate Director of the GAO, Clerio P. Pin, decided to send Dyal from the Atlanta office to review what studies were available. For two months, Dyal read the extensive documentation pertaining to alternate methods of developing launch complex 39. When he departed on 28 October, Dyal stated that the GAO office in Washington would handle further inquiries at NASA Headquarters.40
Upon completion of the audit in June 1967, the GAO sent a 39-page draft report of its findings to NASA Administrator Webb, requesting comments and inviting discussion. A week later, NASA Headquarters transmitted the report to KSC for comments. Even though preparations were under way for the first flight of the Saturn V and the first operational use of LC-39's mobile facilities, KSC undertook an intensive month-long analysis of the validity of the GAO statements. Background documents relating to early decisions were researched and cost figures were reviewed. Almost every office involved in any way with launch complex 39 participated in the analysis. The GAO report was based on records at NASA Headquarters and KSC, as well as numerous industry and in-house studies made between 1961 and 1967. The report also indicated a shift from the initially announced purview of the audit - the concern about duplicate facilities - to focus on launch complex 39 and an analysis of whether or not NASA had "adequately considered the relative operational and cost merits of both mobile and conventional launch facilities." It accused NASA of failing to keep Congress informed on important matters and of using obsolete data in supporting its budget proposals.41
In preparing a response to the GAO report, Debus wrote NASA Headquarters on 19 July 1967 that the GAO had worked from inaccurate assumptions and arrived at erroneous conclusions. In the report, computed savings were based on outdated analyses. Debus asserted that KSC had kept Congress informed on all major issues, and that members of Congress had concurred with KSC's rejection of conventional launch facilities in favor of the mobile concept. At a meeting between representatives of NASA and GAO on 8 September 1967, NASA agreed to hold its response in abeyance until the GAO was able to review new documents.42
Queries continued to come in, and during October threatened to disrupt some KSC operations. NASA Headquarters asked KSC to comment on a statement that would be submitted to GAO the following month. Admiral R. O. Middleton, KSC's Apollo Program Manager, said that some of the key personnel who were being called on to answer the GAO queries were working overtime in preparation for the Apollo 4 mission. He recommended that KSC make no response until two or three weeks after the launch. KSC acceded to the request, however, completing a reply one week before the Apollo 4 launch. Headquarters used some of the comments and added many of its own in a communication to GAO two months later. In a letter of 24 January 1968 accompanying NASA's response, Harold B. Finger, Associate Administrator for Organization and Management, pointed out that the Apollo 4 flight had tested Saturn V-Apollo launch complex 39 and demonstrated that the United States now had a capability to launch large rockets. The choice of the lunar orbital rendezvous, the stress on ground tests in lieu of flight tests, and the successful flights of the Saturns had greatly reduced the number of launches anticipated at the time launch complex 39 had been planned.43
On 27 March 1968, after almost three years of reviewing the mobile concept facilities at LC-39, the GAO informed NASA that it planned no further investigations. Although this meant that it would not submit the report to Congress, the GAO offered NASA some precautionary advice. The review of some of KSC's planning studies convinced the auditors that fixed facilities could have been constructed at a saving of $55 million for a launch rate of 12 or less per year. The GAO would continue to make "reviews of this nature" in view of NASA's large expenditures. It suggested that NASA document all major decisions in a manner that would show clearly the basis for the actions at the time of the decision, and that NASA make all related files available at the start of future reviews. Finally, the GAO expressed hope for better communications with NASA.44
Although the audit diverted much effort to actions that contributed little if anything to the accomplishment of the manned lunar landing, it was not unproductive. By re-emphasizing the need for thorough documentation to support management decisions, the audit increased awareness that, in spite of the pressure of KSC's mission, the center had to remain responsive to periodic audit by the "government's financial watchdog" and had to manage its records toward this end. NASA Headquarters, on its part, hoped that the GAO had become more aware that NASA based its decisions on significant technical factors, in addition to management and cost aspects. NASA also hoped that GAO's constructive suggestions might help prevent such time-consuming, expensive reviews in the future.45
The GAO had questioned NASA's judgment on administrative decisions such as the evaluation of costs, technical decisions dealing with operational effectiveness, and communications between NASA and Congress. The complaints arose chiefly from the GAO's reliance on early planning documents, while NASA had used an evolving series of planning studies that kept pace with new developments. In other words, the GAO saw the early planning studies as an end product, whereas NASA saw them as the first step in a process. Also GAO had the advantage of hindsight. The decisions concerning the mobile concept had been made in the light of contemporary knowledge, at a time when experts were calling for upwards of 50 launches a year.
NASA's reply clearly indicated that it viewed the manned lunar landing program as an embarkation point, not a terminus. It cited 1963 statements to Congress by James E. Webb wherein the Administrator asked for a position of preeminence in space, and the more explicit one by D. Brainerd Holmes that called for "landing on other astronomical bodies."46 The National Aeronautics and Space Act of 1958 lent support to this interpretation. The GAO, on its part, drew a distinction between what the government had authorized and what NASA planned or anticipated. In the broad sense, the GAO had zeroed in on the time-honored practice of government organizations trying to expand beyond immediate authorizations. A rigid adherence to authorized programs without thinking of the future might well have placed NASA in a strait jacket. It would have forced NASA to revert to the abandoned practice of constructing a special facility for each type of launch vehicle, something that members of Congress had hoped to prevent. It would also have restricted the speculation and experimentation necessary for progress.
KSC came out unscathed, except as regards its documentation of management decisions. This was paradoxical in view of KSC's extraordinary devotion to technical documentation. One could argue, as Harold Finger did, that a new organization must give priority to accomplishing its mission and defer paper work to a later date. But this could hardly satisfy the GAO, which by one means or another habitually reminded government organizations that the appropriation of funds is a beginning and not an end, and that they must one day answer for the use of those funds.
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