Office of Inspector General Releases Audit Report for BioServe

Washington, D.C. August 6, 2014 – Each year, NASA awards millions in grant money and cooperative agreements to educational institutions. The Office of Inspector General (OIG) recently completed an audit of one of such agreement between NASA and BioServe Space Technologies – University of Boulder at Colorado (BioServe) and issued its findings in a report dated August 4. The OIG found that BioServe spent cooperative agreement funds for their intended purposes and did not have any questionable costs; it was found, however, that BioServe had run over cost and over deadline.

Since 1987, BioServe has partnered with NASA, industry, and other organizations to conduct ground- and space-based research to support the development of scientific technologies that both benefit human space exploration and have commercially viable Earth-based applications.

In April 2010, NASA’s Space Operations Mission Directorate issued an announcement soliciting offers and concepts for payload integration and operations services, support equipment, and instrumentation capabilities for use on the International Space Station. In response, BioServe submitted a proposal to conduct research exploring the effects on microgravity on the plant species Jatropha curcas. NASA awarded the University a cooperative agreement valued at $600,000 through August 31, 2011.

Through February 2014, NASA and BioServe modified the basic agreement 13 times. In addition to performing research on the Jatropha plant, BioServe agreed to provide hardware and payload integration and operations services for the ISS. As part of the extended agreement, BioServe would develop a Space Automated Bioproduct Laboratory (bio lab) to enable commercial research and development aboard the ISS. BioServe would also be responsible for a multi-well plate for research on microorangisms. The total award was increased to $3,577,247.

Under the terms of the agreement, BioServe was to deliver three bio lab flight units and 30 multi-well plates by September 30, 2013 and March 31, 2014, respectively.

During the audit, the OIG found that BioServe requires an additional $520,000, or about 36 percent, more than the approved budget in order to complete development, delivery, integration, operations, and launch of the bio lab units and $75,000, or 15 percent, more to complete the multi-well plates. Additionally, the products will be delivered from 10-16 months beyond their original schedule.

The OIG found that both NASA and BioServe contributed to the agreement’s cost growth and schedule delays because neither BioServe nor NASA had correctly estimated the complexity of the development effort or technical requirements when negotiating the cooperative agreement. The OIG also found that BioServe did not track and compare actual expenditures to approved project budgets.

The OIG recommended additional efforts to identify and price technical requirements and account for costs in this agreement and in any future cooperative agreements between NASA and BioServe. BioServe will now separately account for and report expenditures incurred for each project and will monitor actual performance against the cost, and schedule milestones NASA and BioServe negotiated for the remaining work on the bio lab and multi-well projects

In June 2014, NASA and the University of Colorado approved a plan pursuant to which BioServe will receive $595,000 in additional funding from NASA and complete the bio lab and multi-well projects by January 2015. NASA contends that the Agency and BioServe now understand the effort needed to complete the projects and anticipate BioServe will meet the revised budget and schedule.

Based in Colorado University’s College of Engineering and Applied Sciences, BioServe is led by a Director and employs approximately 11 University faculty members assisted by graduate and undergraduate students. Hardware developed by BioServe has supported a wide variety of space life sciences, including molecular processes, cell and tissue culture, and the development and adaptation of various plants and organisms to microgravity.

The University has flown payloads on the Space Shuttle, as well as the Russian Progress and Soyuz vehicles, and its payloads have been on the ISS continuously since 2002.

In September 2011, the NASA Office of Inspector General (OIG) reported that NASA did not have an adequate system of controls in place to ensure proper administration and management of the Agency’s grant program and, as a result, some grant funds were not sued for their intended purposes. The recent audit of BioServe was one of a series of audits conducted as a follow-up to that report.