House Passes FY2017 Defense Appropriations Bill Cutting EELV Funds

The House passed the FY2017 Defense Appropriations Bill ( H.R. 5293) today by a vote of 282-138. No space-related amendments were adopted so those provisions remain as they were in the House Appropriations Committee’s version of the bill.  The Obama Administration threatened to veto the bill as reported from committee in part because it cuts funding for the Evolved Expendable Launch Vehicle (EELV) program.

The House bill addresses several national security space issues — from SBIRS to AEHF to weather satellites — but steers clear of the fractious RD-180 rocket engine controversy in terms of how long they may be used and how many may be purchased (a battle which may finally be over).  However, it does require that in future competitions, the award is to be made to the provider that offers the best value — not necessarily the best price — to the government.  The United Launch Alliance (ULA) argues that it cannot compete with SpaceX on price, but its 100 percent mission success rate is a valuable factor that should count in its bids. (Mission success means that the satellite was placed into the intended orbit, even if problems may have occurred during the launch.)

A separate controversy has arisen this year, however, over how many EELVs the Air Force may buy in FY2017.  The request was for $1.501 billion to buy five EELVs, but the House committee decided two were “early to need.”

The report accompanying the House bill did not offer a further explanation, but the Senate Appropriations Committee also denied funds for two of the EELVs and made clear why — exasperation over delays in the new Operational Control Segment (OCX) needed for the newest version of GPS satellites, GPS III.  The Senate committee also recommended dramatic changes in the OCX program, but in terms of launches, it concluded there is no point in launching GPS III satellites if the ground system is not ready. The two launches for which funding was denied are for GPS III satellites.

In its report (S. Rept. 114-263), the Senate Appropriations Committee disagreed with the
Air Force’s plan to launch six GPS III satellites before 2019 because of the
OCX delays. OCX is “needed to launch, checkout, and ultimately integrate
and operate the GPS III satellites with the legacy GPS architecture” and
“will not be ready for many years. … The committee sees no
justification for launching so many satellites without a system in place to
operate them.”

As for OCX itself, the Senate committee recommended termination of OCX Blocks 1-2 (a
reduction of $259.8 million) and add $30 million for “operational M-code
risk mitigation for OCS,” a net reduction of $229.8 million.  OCS is
the Operational Control System, the existing ground system for GPS satellites.

The first GPS satellite was launched in 1978 and the system was declared
operational in 1993.  GPS signals are ubiquitous around the globe for
positioning, navigation and timing (PNT).  A constellation of 24 GPS
satellites is needed for global three-dimensional (latitude, longitude,
altitude) coverage and the satellites have been upgraded several times over the
years, moving through block changes with various designations.  The Air
Force currently has 31 operational satellites that use several
versions of the GPS II series.  The newest version is GPS IIF and the last
of those satellites was launched in February.  GPS III satellites were
supposed to begin launching in 2014, but the date has slipped repeatedly. 
The first currently is scheduled for May 2017.  Lockheed Martin is
building the first eight GPS III satellites and that effort also has been beset
by delays.

Because of the delays in OCX, the Air Force is working on an interim
solution so that the various GPS II satellites and the new GPS III version can
work as an integrated system.  The Senate committee concluded, however,
that the interim solution will not enable all of the capabilities of all the
versions, especially the Military code (M-code), “a key warfighting
need.”  It said the OCX program “remains in jeopardy,” with
a current cost estimate of $2.3 billion, 160 percent above its original
estimate of $886 million.  Although DOD put forward a plan with another
2-year delay, “the contractor and the Air Force believed that a more than
4-year additional delay was likely necessary.”

Consequently, the Senate committee wants the Air Force and the contractor,
Raytheon, to ensure the interim solution — enhancing OCS — works and added
$30 million to enable M-Code broadcast capabilities.   It wants OCX Block
0 completed, but called for terminating funding for OCX Blocks 1 and 2.

The House bill fully funds OCX and no comment about it was made in the committee’s report.  The schedule for Senate consideration of its version of the defense appropriations bill has not been announced.

The Obama Administration’s Statement of Administration Policy (SAP) on the House bill said it would eliminate three, not two, EELV launch service procurements as the committee intended, and introduce cost and schedule risk for national security satellites.