House Science Committee Gives Industry What It Wants

Capitol Building
The commercial space industry had a great day on Capitol Hill on Wednesday, with the Republican-controlled House Science Committee giving it most of what it wanted while swatting away proposed changes from the minority Democrats.

Among the goodies approved by the committee: a decade-long extension of the moratorium on regulating commercial human spaceflight;  a nine-year extension of industry-government cost sharing for damages caused by launch accidents; and an act that would give companies property rights to materials they mine from asteroids.

The nature of the bill was not a surprise. It was sponsored by Rep. Kevin McCarthy (R-CA), whose Congressional district includes the Mojave Air & Space Port. The extensions to the moratorium and launch indemnification regime was championed by new committee member Steve Knight (R-CA), who has close ties to Mojave and the commercial space industry.

Republicans said the measures would give certainty to the industry and foster the further development of the commercial space industry. Rep. Donna Edwards (D-MD) and other Democrats opposed many of the provisions, complaining about a lack of hearings about them. Republicans said the issues had been discussed, and they chided the opposition party for failing to respond to draft legislation on a timely basis.

Democrats said the provisions seemed to have been written by industry, a charge the Republicans denied. Edwards said when Congress gets a wish list from an industry, it should act with restraint.

All in all, it was a contentious hearing that showed a clear breakdown in bipartisan agreement on space policy.

The committee marked up four bills on Wednesday:

  • H.R. 2262 Spurring Private Aerospace Competitiveness and Entrepreneurship Act of 2015 (SPACE Act of 2015)
  • H.R. 1508 Space Resource Exploration and Utilization Act of 2015 [Parabolic Arc Story]
  • H.R. 2261 Commercial Remote Sensing Act of 2015
  • H.R. 2263 Office of Space Commerce Act

The SPACE Act was the most extensive of the bills, with the most debate and 13 proposed amendments. The measure would have the most far-reaching impact on the industry.

The measure originally proposed extending the moratorium on Federal Aviation Administration (FAA) regulations on commercial spaceflight for eight years to the end of 2023. However, Rep. Steve Knight (R-CA) proposed an amendment extending the learning period to 2025. Knight and other supporters said the period will allow companies to gain experience, learn lessons, and develop voluntary standards that will inform mandatory regulations.

Democrats proposed extending the moratorium for five years, which would match the extension contained in a Senate bill proposed by Sen. Ted Cruz (R-TX). They noted the FAA’s Office of Commercial Space Transportation (FAA AST), which oversees the industry, wants the moratorium to end when it expires at the end of September. FAA officials say there is enough experience from 50 years of human spaceflight to formulate regulations.

Members voted 18-12 along party lines to approve Knight’s 10-year extension, which would give the FAA the ability to formulate regulations only in response to specific accidents. The agency w0uld not be able to write more general regulations affecting passenger safety.

The SPACE Act requires a series of reports on industry’s efforts to formulate common safety standards and the operational lessons learned from flying paying passengers. It also calls for an independent safety study prior to the imposition of regulations.

The same voting pattern followed on commercial launch indemnification, which expires at the end of 2016. The bill proposed a seven-year extension from the end of 2016 to 2023.  The committee approved Knight’s amendment to extend the cost-sharing arrangement to the end of 2025. The Democrats wanted an extension to 2020.

Under law, companies are responsibility for damages from a launch up to $500 million. The federal government covers any damages from $500 million to $2.7 billion. Companies are responsible for any damages above that level.

Palazzo said the extension would provide regulatory certainty to the launch industry. He warned that thousands of workers could lose their jobs if there was uncertainty about these provisions.

Democrats said the indemnification regime was supposed to be an interim arrangement until the commercial launch industry got fully established. That was back in 1986; however, Congress keeps extending the liability regulations.

The SPACE Act includes provisions for updating the calculations used to determine maximum probable losses resulting from launch accidents.

Another controversial provision in the act would give federal courts sole jurisdiction for any legal claims resulting from a licensed launch or re-entry. Rep. Steve Palazzo (R-MS) said this would prevent “bad actors” from “venue shopping” among states with different liability laws. Everyone would be treated equally under federal law, he said.

Edwards said because there is no federal law governing private spaceflight, this provision would amount to giving the industry immunity from the consequences of accidents. Her amendment to remove the language failed on a party line vote.

Rep. Eddie Bernice Johnson said she found it unconscionable that Republicans were pushing both a decade-long moratorium on FAA regulations and giving federal courts sole jurisdiction over claims with no laws upon which to base decisions.

Committee members also clashed over insurance requirements for commercial flights. The SPACE Act adds spaceflight participants (i.e., passengers) to the list of parties for which there needs to be an insurance policy or demonstration of financial responsibility.

Edwards said the issue is complicated and needs more study. Early on, it was assumed that only the very rich would fly on commercial spacecraft. They would be wealthy enough to indemnify themselves. That group has been expanded to include researchers and contest winners who may not be wealthy.

Edwards proposed an amendment to remove the provision and to commission a study by the Comptroller General of issues and options relating to spaceflight participant insurance. The measure was defeated in a voice vote along party lines.

Democrats also tried to eliminate a provision that would add spaceflight participants (passengers) to the list of parties that must sign cross-waivers not to sue other parties involved in flights. Members expressed concerns about passengers signing their rights away even in cases of gross negligence.

Rep. Bill Posey (R-FL) said that despite the cross waiver provision, spaceflight participants would still be able to sue for gross negligence.

Rohrabacher warned that without the cross-waiver provision, only the “mega wealthy” would be able to fly to space. He said that while he would not fly on these spacecraft, people should have the right to take that risk and to sign away their liability protections.

There was also disagreement over a provision that would allow spaceflight operators to simultaneously hold both experimental permits and launch licenses for their vehicles. Under current law, the experimental permit lapses once a launch license is issued for a vehicle. Industry officials say they need to be able to test improvements and repairs to their spacecraft.

Democrats argued that the provision is not needed. They said the companies have the authority under launch license to conduct this type of testing. The Republicans disagreed, citing FAA officials who said they needed this change in the law.

The committee approved an amendment sponsored by Posey calling upon the FAA to streamline operations at launch ranges to better facilitate commercial operations. He noted that red tape had driven some launch companies away from federally operated ranges.

Edwards agreed with the intent of the legislation, but she asked Posey to withdraw it. She said the amendment would impose additional burdens on FAA AST, which is straining to keep up with the increased level of commercial space activities. Edwards noted that the House had turned down a request for a boost in the FAA AST’s budget to hire additional employees to deal with the larger workload.

The committee also approved an amendment by Jim Bridenstine (R-OK) to commission the Government Accountability Office (GAO) to do a study on how to the FAA should handle launch support vehicles. Bridenstein was not specific, but he was likely referring to Virgin Galactic’s WhiteKnightTwo and Stratolaunch’s giant carrier aircraft, both of which will launch rocket vehicles from altitude.

These aircraft would normally be subjected to the FAA’s rigorous certification process before they would be able to carry passengers. Certification is time consuming and expensive. However, if the aircraft were considered part of the launch system, operations could be covered under the less rigorous launch license.

Virgin Galactic has plans to carry passengers in WhiteKnightTwo. Possible activities include training, parabolic flights and watching launches of SpaceShipTwo.