Key House Appropriator and NASA Agree on Commercial Crew Downselect

Rep. Frank Wolf (R-VA), who chairs the House appropriations subcommittee that funds NASA, and NASA Administrator Charlie Bolden, have agreed to limit the number of winners of commercial crew contracts to 2.5 instead of four.  An exchange of letters revealing the agreement was released by Wolf’s office today.

The first letter, from Wolf to Bolden on May 31, laid out the chairman’s understanding of NASA’s intentions for the Commercial Crew Program (CCP) based on recent discussions between his office and the agency.  Bolden’s reply yesterday affirmed that understanding.   

Among the agreed upon points is that NASA plans to select no more than 2.5 program partners (two full awards and one partial award) in the next phase of the CCP.  That phase is called Commercial Crew Integrated Capability (CCiCAP) and follows the two initial CCDEV rounds of awards made in 2010 and 2011.  In this third phase, companies must bid to provide a complete — “integrated” — system to take crews to and from the International Space Station (ISS) instead of just a spacecraft or just a launch vehicle, for example.

The number of companies to be funded is one of the sticking points between Congress and the Obama Administration on the CCP.  Although it is called a “commercial” program, it involves significant taxpayer investment.  NASA plans to spend $4.8 billion between FY2011 and FY2017 on commercial crew development.  The companies also are expected to invest their own capital, however, which makes this different from previous NASA human spaceflight programs.

NASA wants to ensure there is sufficient competition to yield at least two companies that will be able to provide commercial crew services.  It does not want to narrow the field (“down-select”) too quickly in this phase of the program.  Congress, however, wants to limit the amount of funds it must provide to support those companies.  NASA funded four companies in the second CCDEV round, but in the FY2013 Commerce-Justice-Science appropriations bill crafted by Wolf’s subcommittee and passed by the House on May 10 (H.R. 5326), the House told NASA to choose only one company, or at most one “leader” and one “follower.”   The Senate Appropriations Committee’s version of the bill (S. 2323) only cautions NASA not to take on obligations to more companies that can be “practically supported” in the current budget environment.

Another point of contention is how NASA is contracting with these companies.  So far, NASA has used Space Act Agreements (SAAs) instead of traditional contracts based on Federal Acquisition Regulations (FAR).  NASA planned to use FAR-based contracts for CCiCAP, but reversed course last December because it concluded that funding uncertainties made FAR-based fixed price contracts unrealistic.   NASA has little insight into what the companies are doing under SAAs.  It simply pays the companies once they meet agreed-upon milestones.   Under FAR-based contracts, NASA can set requirements and have insight and oversight of how the companies meet those requirements.  Congress has repeatedly expressed concern that commercial companies may not pay as close attention to astronaut safety as would NASA and want the agency to be able to keep tabs on what the companies are doing, hence the need for FAR-based contracts.

In the exchange of letters, NASA agrees that it is working on a strategy to use FAR-based contracting in the future and “anticipates having this strategy substantively complete” before making the CCiCAP awards and “will use FAR-based contracts” for certifying commercial crew capabilities and procuring crew transportation services.

Bolden’s letter said that the program needed more funding than the $500 million the House provided for FY2013.   NASA’s request was $830 million.  The Senate Appropriations Committee recommended $525 million (the Senate has not acted on the bill yet).  In a press release, Wolf said he agreed that funding should be “at or near” the Senate level.  He said he had reached this understanding with NASA “to prevent any disruption in the development of crew vehicles” to take astronauts to and from the ISS.