NASA Makes Changes To Commercial Space Taxi Program
December 16, 2011

NASA Makes Changes To Commercial Space Taxi Program

Budget cuts will likely force NASA's reliance on Russia to ferry astronauts to and from the International Space Station for the foreseeable future, NASA´s head of space operations said Thursday.

NASA´s planned goals of securing US commercial crew transportation systems has faced significant challenges that could impact its success in the future. And with limited funding to NASA´s commercial crew development (CCDEV) program, it is likely NASA won´t be flying astronauts to the space station until at least 2017.

The funding for NASA´s program is significantly lower -- nearly half -- than the $850 million needed and may not allow it to award multiple contracts, which is its key element for maintaining cost control by sustaining competition through all phases of its CCDev program. NASA also says the current program schedule may not be attainable given its past experiences with government and commercial development efforts.

To make do, NASA will abandon plans for traditional fixed-price contracts and will instead use less expensive and more flexible partnering agreements.

“It´s one small step for Commercial Crew,” Bigelow Aerospace attorney Michael Gold told Reuters, referring to NASA´s space taxi development program. “And one giant leap for common sense.”

NASA is determined to keep at least two space taxi designs going for the agency´s future business.

“We would like to carry two providers at a minimum, actually more,” NASA associate administrator Bill Gerstenmaier said during a conference call with Reuters. “We think competition is a key piece.”

NASA is currently funding four commercial firms: Boeing, SpaceX, Sierra Nevada Corp, and Amazon founder Jeff Bezos´ Blue Origin.

“Our investment helps to ensure that this capability gets done in as timely a manner as we can actually make it occur,” Gerstenmaier said.

If NASA cannot maintain more than one contractor for its CCDev program, its prospects for competition in the future will be severely limited. Although some private investment is anticipated, without government investments the market alone may not continue to grow to provide more than one contractor that would be able to compete for future phases.

As a result, NASA could become dependent on one contractor for providing crew transport to the ISS, which increases the risk that the government will pay more than anticipated as few or no competitors will exist to help control market prices.

A solicitation for the next phase of the program was due to be released on Monday, but will be delayed until the first quarter of 2012, Gerstenmaier said. The selection of companies, however, should remain on schedule for next summer.

NASA, which currently has $406 million to spend on CCDev this year, is uncertain how much money it will receive to see the development effort through the planned 21-month period.

NASA Administrator Charles Bolden said in a statement that the agency is “committed to ensuring that US companies are sending American astronauts into space.”

“This new acquisition strategy will allow us to preserve competition as we maintain our momentum to provide a US-based commercial crew launch capability at the earliest possible time,” he said.

But maintaining US-based commercial crew transportation comes with a price: limited control over the designs that are produced.

“We can´t actually approve their designs, we can´t say we´re needing a service or getting a service,” but the companies at least will be able to keep making progress, Gerstenmaier said. He used the rocket-science term for “change” to describe how the process could go: "There´s going to be some potential delta that has to occur when we complete this phase.”

The companies involved in CCDev had initially voiced their concerns about the fixed-price contract plan, fearing NASA could exert too much control or even cancel the program altogether before completion.

SpaceX, one of the CCDev companies, issued a statement on today´s shift in strategy.

“Given budget realities, NASA and domestic space companies need to innovate more than ever,” SpaceX President Gwynne Shotwell was quoted as saying. “Space Act Agreements yield amazing results – we need only look at the Dragon spacecraft and Falcon 9 rocket, both highly advanced, all-American vehicles designed using 21st-century technology. We applaud NASA´s decision to use Space Act Agreements for the next round of commercial crew and look forward to the competition.”

However, US Representative Ralph Hall, the Texas Republican who heads the House Science, Space and Technology Committee, questioned the move.

“The disadvantage of using Space Act Agreements is that NASA cannot impose its safety requirements as would be possible under a normal acquisition,” Hall said in a statement. “Therefore, it is vitally important that NASA and its industry partners work cooperatively to ensure the highest level of crew safety, even in the absence of safety requirements.”

In a report issued today, the Government Accountability Office, Congress´ independent investigative arm, mentioned fixed-price, performance-based contracts as one of the “good acquisition practices” that NASA was planning for future CCDev work.

The difference between traditional government contracting and Space Act Agreements is night and day, added Gold, who oversees business growth for Bigelow Aerospace. “It´s the difference between a 30-page contract and one that could involve 3,000 pages of regulations,” he said. “Even understanding what you're up against can take months of review by lawyers. If you want to spend more money on lawyers and less on launches, FAR (Federal Acquisition Regulation) is a terrific way to proceed.”

“We applaud NASA´s plans to continue using competitively awarded Space Act Agreements to accelerate the development of truly commercial crew capabilities. We believe commercial means significant private investment and competition to accelerate technologies and capabilities designed to enable a space economy, one that includes trips to the International Space Station,” Blue Origin president, Rob Meyerson, said in a statement about NASA´s change of plans.


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