Traditionally challenged to meet cost/schedule management and performance goals, NASA is in for even tougher fiscal challenges, warns its inspector general, Paul Martin.

NASA will be further tested across five fronts, including human spaceflight, by flat budgets or worse, as the White House and Congress attempt to rein in spending to deal with mounting budget deficits, Martin says in a new report.

The new pressures will be punctuated by the looming budget penalty known as sequestration and the January “fiscal cliff,” which threaten to cut an additional $1.5 billion from an annual NASA budget that has already declined to $17.7 billion from $18.4 billion in 2011.

“Even if this looming cut is averted, NASA is likely to face constrained budgets for the foreseeable future,” notes Martin in the IG’s 2012 Report on NASA’s Top Management and Performance Challenges, released Nov. 15.

Human spaceflight is joined on the IG’s list of top concerns by project, infrastructure and facilities, and acquisition and contract management; and information technology security and governance.

“This year, we noted that declining budgets and fiscal uncertainties have compounded the difficulty of meeting these challenges,” Martin reports. “Perhaps, more than any other factor, these fiscal pressures will present NASA leaders with difficult choices in the year ahead.”

On the human spaceflight front, the agency has adjusted to the $406 million it received for fiscal 2013 versus an $850 million request in fiscal 2012 to foster the development of commercial crew transportation services in support of the International Space Station (ISS). But the agency noted it cannot meet its goal of a 2017 startup without $850 million annually during the development period.

Currently, ISS operations are projected through 2020. With a goal of a weekly average of 35 hr. of science activity aboard the six-person orbiting science lab, the agency has only been able to manage 26 hr. due to maintenance requirements and personnel limits. Commercial services would permit the station to add a seventh crewmember, according to the report.

Meanwhile, the agency’s efforts to develop a deep-space human exploration capability with the Space Launch System rocket and the Orion/Multipurpose Crew Vehicle is constrained to meeting the objectives of a first integrated unpiloted test flight in 2017, followed by an inaugural manned test flight in 2021. The limitations prevent NASA from meeting all of the requirements for a human mission to a yet-to-be-selected asteroid by 2025, according to the IG’s assessment.

The agency continues to reel from the project management lapses of the James Webb Space Telescope. Once scoped at $5 billion with a 2014 launch date, the project is now pegged at $8.8 billion with a sendoff in late 2018.

“Given the anticipated funding challenges for all federal agencies in the years ahead, changes to the way NASA develops and manages its projects are imperative,” notes Martin, whose auditors found the agency permeated by a “culture of optimism” with too few opportunities to train future managers.

Though a small part of the overall federal bureaucracy, NASA is the government’s ninth-largest property owner with 4,900 structures, 80% of them at least 40 years old, and 10% of them underused or not at all. A mounting deferred maintenance bill of nearly $2.5 billion is forcing NASA to lease out or divest the excess.

“NASA must move beyond its traditional conservative approach of ‘keep it in case we need it,’ in managing its facilities,” according to the report.

In 2011, 81% of NASA’s budget flowed to contractors in support of the agency’s mission, making it especially vulnerable to waste, fraud and abuse. The agency continues to struggle with insight into a range of grant and research awards, including the popular Small Business Innovation Research program, the report says.

The IG found NASA a popular target of domestic and foreign IT system intrusion because of the vastness of its networks and the value of the data.