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Event-based optimization (EBO) provides a general framework for policy optimization in many discrete event dynamic systems where decision making is triggered by events that represent state transitions with common features.Because the number of events can be defined by the user and usually increases linearly with respect to the system scale,EBO has good potential to address large-scale problems where the state space grows exponentially.However,in many practical systems,sensors are geographically distributed and connected to a central controller through imperfect communication channels.Therefore,events observed by the sensors may not reach the controller.Optimization methods of event-based policies in these cases have not yet been identified.In this paper,we consider this important problem and make three major contributions.First,we formulate a mathematical EBO model in which the communication between sensors and controllers is subject to random packet dropping.Second,we show that this EBO model can be converted to another EBO model with perfect communication.Then,the performance difference equation and the performance derivative equation for event-based policies are straightforward to develop.One gradient-based policy iteration algorithm is developed for problems where the state transition probabilities are explicitly known,while another for problems where they are unknown.Third,the performance of the algorithms and the impact of the packet dropping probability on policy performance are numerically demonstrated on a single-zone occupant level estimation problem in buildings.