NASA IG Worries About Commercial Crew Schedule, Says NASA “Overpaid” Boeing

In an illuminating report about the costs of NASA’s commercial crew program, NASA’s Office of Inspector General (OIG) today criticized almost $300 million NASA paid to Boeing above the amount agreed to in a fixed price contract. It also calculated that NASA is paying Boeing substantially more per seat than SpaceX.  But the report’s overall concern is that schedule delays in both systems will sharply limit U.S. presence on the International Space Station (ISS) beginning next spring.

Boeing and SpaceX are building crew transportation systems to take astronauts to and from the ISS through public-private partnerships (PPPs) with NASA.  The companies own the systems — CST-100 Starliner and Crew Dragon, respectively.  NASA purchases services from them similar to the payments it currently makes to Russia for trips using its Soyuz spacecraft.  NASA awarded the Commercial Crew Transportation Capability (CCtCAP) contracts in September 2014:  $4.2 billion to Boeing and $2.6 billion.

NASA has not been able to launch anyone to the ISS since the space shuttle was terminated in 2011.  The commercial crew systems will restore the ability to launch American astronauts on American rockets from American soil.  When President Obama initiated the commercial crew program in 2010 (the FY2011  budget request), the expectation was that the systems would be ready by 2015, a four-year gap in the U.S. ability to put people in orbit.  That has stretched to eight years and counting.  The delays are attributed to Congress providing less than requested funding in the early years and a variety of technical challenges encountered by both companies as development progressed.

As Vice President Pence said again today during a speech at NASA’s Ames Research Center, the hope now is that the systems will be launching astronauts by spring.  No dates have been set, however.  NASA’s position at the moment is that it will not set any launch dates until Doug Loverro, the incoming head of the human exploration program, has had a chance to review everything.

As the OIG report explains, however, Russia is cutting in half — from four to two — the number of Soyuz flights to the ISS beginning next year because the plan was for the U.S. systems to be operating by then.  Soyuz can accommodate three crew members and each U.S. system can carry at least four.  “Expedition” crews rotate on roughly 6-month schedules.  The idea was for a typical expedition crew complement of seven people starting in 2020–three using Soyuz, four using one of the commercial crew systems.  If only Soyuz is available, there will be only three and only one will be American.

NASA just announced the crew assignments for the next Soyuz launch in April and that is exactly its composition: NASA astronaut Chris Cassidy and Russian cosmonauts Nikolai Tikhonov and Anatoly Babkin. Their mission is intended to last until October 2020 when the next Soyuz will be launched.  The OIG report shows a potential scenario for how many crew members from Russia or the U.S. On-Orbit Segment (USOS, which includes European, Japanese and Canadian partners) might be aboard if the commercial crew systems are not available to supplement the Soyuz flights.

During a press conference last week, Cassidy did not seem concerned.  He said he and his fellow crew members got extra training in case they are the only three on-board for the entire six-month duration of their mission. “With luck, we’ll have some [commercial crew] visitors and we’ll be excited for that, but we’re also ready, operationally, mentally, all that, prepared to just be the three of us on the space station…”

In its response to the OIG report, NASA also was not concerned.  NASA said it has already requested seats on the Soyuzes that will launch in fall 2020 and spring 2021.  In addition, its Russian counterpart, Roscosmos, is studying whether the Soyuz spacecraft can remain in orbit for more than 200 days, past its current certification, so the crews could remain longer.

The OIG pointed out that NASA must have a waiver from the Iran, North Korea, Syria Nonproliferation Act (INKSNA) to purchase crew transportation services from Russia and the current waiver expires on December 31, 2020, so NASA would not be able to pay for the spring 2021 flight.  NASA replied that it has requested an extension of the waiver from Congress already.

Indeed, the 2019 NASA Authorization Act that was approved by the Senate Commerce, Science, and Transportation Committee yesterday would extend the waiver for another 10 years.  The bill still has a long way to go before becoming law, but hopefully can get through all the hurdles in time.

The OIG’s overall concern, though, is that both commercial crew systems are far behind schedule.  NASA insisted on having two contractors, not just one, for this very eventuality. The idea was to have two competitors building systems under fixed price contracts both to keep costs in check and if one fell behind, the other might not.

But both are behind schedule and, as the report reveals, NASA paid Boeing $287.2 million above the fixed price contract, so keeping costs in check through competition has not necessarily proved out either.

NASA purchased six flights from Boeing and the extra payments are for flights three through six, called Post-Certification Missions (PCMs), an average increase of $71.8 million per mission.  The OIG said the extra money was to provide more flexibility in scheduling those missions and because NASA’s Commercial Crew Program (CCP) office believed Boeing might withdraw from the program otherwise.

According to several NASA officials, a significant consideration for paying Boeing such a premium was to ensure the contractor continued as a second crew transportation provider.  CCP officials cited NASA’s guidance to maintain two U.S. commercial crew providers to ensure redundancy in crew transportation as part of the rationale for approving the purchase of all four missions at higher prices. Additionally, senior CCP officials believed that due to financial considerations, Boeing could not continue as a commercial crew provider unless the contractor received the higher prices. — OIG Report

Acknowledging that NASA made these decisions in 2016 and situations looks different in hindsight, the OIG nevertheless concludes NASA “overpaid” Boeing, questioning $187 million of the extra payment.

NASA vehemently rejected that conclusion.

Boeing also pushed back. In an emailed statement to SpacePolicyOnline.com, a Boeing spokesperson said the company “offered NASA additional flexibility” and “is also now holding all of the up-front mission costs, which NASA will not have to pay until after each mission is officially ordered and given the Authority to Proceed (ATP).”  The company also rejected the implication that it might have withdrawn from the program if it did not get the additional money.  “Boeing has made significant investments in the commercial crew program and we are fully committed to flying the CST-100 Starliner and keeping the International Space Station fully crewed and operational.”

The “flexibility” was deemed necessary because at the time there were concerns about a potential gap in astronaut access to ISS.  The OIG also strongly criticized NASA for not looking at alternatives to paying Boeing more money, including not asking SpaceX to make a proposal.

In NASA’s efforts to fill a perceived crew access gap, we found that SpaceX was not provided the same opportunity as Boeing to propose a solution. As a result, NASA paid Boeing an additional $287.2 million to accelerate its production schedule for four missions without reaching out to the Agency’s second commercial crew contractor to maximize the Agency’s options. Three months after proposals were due for the third through sixth crewed missions, NASA unilaterally changed its flight requirements for Boeing and the contractor submitted a revised proposal with shorter lead times and higher pricing than stipulated in the base contract. In contrast, SpaceX was not notified of this change in requirements and was not provided an opportunity to propose similar capabilities that could have resulted in less cost or broader mission flexibilities. — OIG report

Boeing’s price per mission also is substantially higher than SpaceX’s according to the OIG: $90 million versus $55 million.  Each spacecraft can accommodate at least four astronauts.  For comparison, NASA currently pays Russia about $80 million per astronaut.

In response to a query from SpacePolicyOnline.com, SpaceX avoided specific comments on any aspect of the report, saying only that “SpaceX and NASA have worked in close partnership, applying all that we have learned from extensive testing and analysis to improve our systems and ensure Crew Dragon is one of the safest, most reliable spacecraft ever built. There is nothing more important to our company than human spaceflight, and we look forward to safely flying NASA astronauts to and from the International Space Station starting early next year.”

The OIG made five recommendations to NASA, which concurred with them all.  However, the OIG noted that “none of the corrective actions have estimated closure dates” so they remain open.

Meanwhile, Boeing is getting ready for its uncrewed Orbital Flight Test of CST-100 Starliner on December 17.  It just completed its Pad Abort Test in preparation for its Crewed Flight Test (CFT) sometime next year.  Those steps are required for the certification for operational missions.

SpaceX completed its uncrewed flight test, Demo-1, in March.  Its Pad Abort Test took place in 2015 and an In-Flight Abort (IFA) test is expected in the next few weeks following a successful static fire test yesterday. That will be followed by its crewed flight test, Demo-2.

The crewed flight tests are part of the certification process so although the OIG report asserts the systems will not be certified until at least next summer, that does not mean astronauts will not fly on them before that.

NASA already has an agreement with Boeing that the CFT might be extended to a 6-month mission and says in its response to the OIG report that it is “looking at” a similar arrangement with SpaceX.

The bottom line is, though, that tests often reveal problems. That is the point of testing.  Though the Vice President sounded confident today that astronauts will be flying to the ISS on commercial crew systems in the spring, that is far from guaranteed.  No dates have been set yet.