House to NASA: Down Select to Single Commercial Crew Competitor Immediately

By Douglas Messier
Parabolic Arc Managing Editor

The FY13 Commerce, Justice, and Science Draft Committee Report [PDF] says that NASA should immediately down select to a single competitor in the commercial crew program to save money and time in fielding a shuttle replacement:

“The Committee believes that many of these concerns would be addressed by an immediate downselect to a single competitor or, at most, the execution of a leader-follower paradigm in which NASA makes one large award to a main commercial partner and a second small award to a back-up partner.”

In short, the committee believes the commercial crew program is too expensive and will take too long. Legislators also do not believe there is a market for more than one crew provider and that the program risks becoming another Solyndra. So, they want commercial crew to look as much like a traditional NASA procurement, with one provider and procurement under traditional Federal Acquisition Regulation (FAR).

A section of the report outlining the committee’s thinking in detailed is reproduced after the break. Thanks to Clark Lindsey for finding it.

Commercial crew.—The Committee supports the goal of achieving independent and redundant access to the International Space Station (ISS) but remains concerned about many aspects of NASA’s approach to the commercial crew development program. First, the Committee believes that the program’s total estimated development costs of $4,868,000,000 are too high given that the current commit- ment to the ISS leaves NASA with only a few years to make use of commercial crew services and no sufficient additional market has been clearly demonstrated in the absence of NASA as a base customer.

Second, the current structure of the program has insufficient safeguards in place to protect the government’s interests in intellectual or physical property developed with Federal money in the event that companies are terminated from or opt to leave the pro- gram. As such, there is a risk of repeating the government’s experience from last year’s bankruptcy of the solar energy firm Solyndra, in which the failure of a high risk, government subsidized development venture left taxpayers with no tangible benefit in exchange for their substantial investment.

Third, the Administration appears to be pursuing potentially inconsistent goals for the program: (1) the achievement of the fastest, safest, most cost effective means of domestic access to the ISS, and (2) the “seeding” of a new commercial spaceflight industry. Given the overwhelming importance of the first of these goals, any funding, time and effort expended in pursuit of the second is potentially a distraction from other necessary work, and, in an environment of fiscal constraint, a dilution of limited resources.

Finally, the program’s current acquisition strategy lacks any defined plan to transition from the planned Space Act Agreement (SAA)-based Commercial Crew Integrated Capability (CCiCap) round of awards to a Federal Acquisition Regulation (FAR)-based certification and service contract. As a result, the strategy presents a significant risk of costly, lengthy delays as NASA attempts to retroactively assess competitors’ designs on safety and other standards and companies attempt to make changes in fully mature integrated designs to address instances in which NASA cannot verify that a necessary qualification criterion has been met.

The Committee believes that many of these concerns would be addressed by an immediate downselect to a single competitor or, at most, the execution of a leader-follower paradigm in which NASA makes one large award to a main commercial partner and a second small award to a back-up partner.

With fewer companies remaining in the program, NASA could reduce its annual budget needs for the program and fund other priorities like planetary science, human exploration or aeronautics research. In addition, an accelerated downselect would allow NASA to focus its remaining funds and technical assistance resources on the most promising contender, potentially enabling that competitor to produce a final capability faster than otherwise possible. It would also allow NASA to return to its previous acquisition strategy of holding an open competition (to include current funding recipients and new entrants) and following a more traditional FAR-based management approach, avoiding a complex transition from SAAs late in the development process and allowing the government to better protect its interests in intellectual and physical property developed with taxpayer funds. Finally, this strategy is more consistent with current overarching fiscal guidance included in the fiscal year 2013 House budget resolution. In a climate of decreasing non-defense discretionary spending, the Committee does not believe that the Administration’s proposed budget runout for commercial crew is sustainable.

For all of these reasons, the Committee believes that the advantages offered by an immediate downselect and a return to FAR-based contracts outweigh the potential benefits of maintaining the current program structure. As a result, the Committee directs NASA to execute the program as described above and in accordance with a fiscal year 2013 funding level of $500,000,000, which is equal to the level agreed to by Congress and the Administration in the NASA Authorization Act of 2010 (Public Law 111–267).

  • Marcus Zottl

    A “single” “competitor”? That doesn’t even make any sense at all!

    I’m furious about the stupidity of the “responsible” politicians… and I’m not even American.

  • reader

    “downselect to a single competitor”

    Oxymoron alert – single competitor.

  • Andy

    “Commercial crew is too expensive and will take too long” says Frank Wolf with a totally straight face as he hands bags of money to SLS…

  • “Commercial Crew” is up against the inherent monopolistic preference of Americanism. All that those of influence want is to be running a permanent monopoly.

    “Commercial Launch” should go for the general passenger and cargo market, accepting Governments as just customers.

    Planetary Resources, Inc. will need that.

  • “the Committee believes that the advantages offered by an immediate downselect and a return to FAR-based contracts outweigh the potential benefits of maintaining the current program structure.”

    These people have no imagination

  • Greg Holden

    Ok, I understand that congressman have to look after their constituents and look to ‘preserve’ jobs… What gets me though is it always seems to be Republican representatives who want to take Nasa’s ‘seeding’ money away from the burgeoning commercial space enterprises who offer fixed price contracts, actively encourage competition, which of course leads to cheaper access to space and should inevitably blossom into a profitable industry employing hundreds of thousands of people and hand it to the behemoth ‘senate designed’ SLS so they can ‘save jobs and expertise’… I just don’t get it; surely it’s Republicans who stand for free enterprise and competition while the Democrats are ‘nasty socialists’? Seems to me it’s the Democrats (mostly) who are pushing for free enterprise and the Republicans who are trying to save pork and keep spending billions on unsustainable public space projects tied to cost plus contracts that literally never get off the ground!! Is this just me scratching my head at this one or has this irony struck anyone else?… Politics eh!! *shakes head in dismay*

  • warshawski

    Greg, That is America promoting free trade around the world but with some of the most protectionist policies in the world such as the Janes act and agricultural subsidies. It is exactly the same approcas with space saying they support an open free market but setting up sole source cost plus contracts for launch services (ULA) and rocket design SLS/Orion. The traditioanl FAR contracts are designed to allow infinate buracratic interfearence in the company wjich slows down progress and drives up cost.
    Politics is not about achieving anything but about getting enough sound bites on TV and “saving jobs” is a great sound bite. Just because it causes long term harm and prevents growth of a new industry that would create many more jobs is beside the point.

  • Greg Holden

    Hi Warshawski, yeah, I hear you!! 🙂 to be honest I hesitated before pushing the send button on that rant of the day, especially when it comes to politics, but the whole thing is enough to make my brain squeek! Lol! Thinking about it, it seems to me that ANY government money is worth its wait in gold, no matter how much because it adds confidence to the market and encourages private investment… Lets not get into ITAR though; huge legal hurdle!! Anyway, it looks like the momentum has well and truly started for a private space industry, with some very rich (and dynamic) movers and shakers, for example Planatery Resources Inc, just look at who’s prepared to cough up to make that bad boy concept happen!! The way I see it we need to keep the faith and our eyes on the big picture; I think it will be difficult now for small minded politicians protecting their own interests to stop this snowball… Interesting news today from the UK’s reaction engines Ltd too… No ITAR there!

  • Anonymous

    No they need to downselect it to zero competitors. If their reason to have only SLS. Or they can downselect it to ATK, that’s great – same Ares I + Ares V (aka SLS).
    But think differently. If those companies really commercial, they can do everything by investors money until they’ll deliver cargo/crew and have profit. Those money don’t encourage innovation, cause with it SpaceX can use same hardware/technology as Boeing. Nor it doesn’t create competition, cause small innovative companies, not for profit organizations or any nonAmericans was/will not compete (not enough NASA managers “connections”)
    But all those COST/CCdev/etc contracts are really development subsidiaries, that makes one companies ahead of others. In any project 3 things – time, money, quality – you can’t get it all. Now American wanna race it to return to LEO, so there will be 3 possibilities – low cost+high quality but very long, low cost low quality fast(SpaceX possible) or much more unrealistic high cost/high quality/fast(SaturnV). But guys in SLS will make much grandiouse scheme – high cost/low quality/long. ;0))))