New Commercial Space Bill Clears House Committee

The House Science, Space, and Technology (SS&T) Committee approved the American Space Commerce Free Enterprise Act of 2017 (H.R. 2809) by voice vote today.  Although the bill has bipartisan sponsorship, the top Democrat on the committee, Rep. Eddie Bernice Johnson (D-TX), offered a substitute version of the bill as an amendment, but later withdrew it acknowledging that there were not enough votes for it to pass.  Three other amendments were adopted by voice vote.

The three main sponsors/co-sponsors of the bill are Rep. Lamar Smith (R-TX), chairman of the House SS&T committee; Rep. Brian Babin (R-TX), chairman of the space subcommittee; and Rep. Jim Bridenstine (R-OK).  Joining them as co-sponsors are Republicans Dana Rohrabacher (CA), Randy Hultgren (IL), Randy Weber (TX), and Clay Higgins (LA) and Democrats Ed Perlmutter (CO) and Derek Kilmer (WA).  

Twenty  companies and industry associations submitted letters of support for all or portions of the legislation, including the Commercial Spaceflight Federation and the Satellite Industry Association.  Most of the letters are posted on the committee’s website.

The committee circulated a draft of the bill to stakeholders several weeks ago.  Smith said the committee received input from companies, federal agencies, the Administration, and committee colleagues and incorporated “many if not most” of the recommended changes.

Smith characterized the bill as declaring that “America is ‘open for business’ in space.”  The bill “establishes a legal and policy environment intended to unleash American free enterprise and business, assure conformity with Outer Space Treaty obligations, and ensure that the United States will lead the world in commercial space activities throughout the 21st Century.”

House Science, Space, and Technology Committee Chairman Lamar Smith (R-TX) at markup of H.R. 2809, June 8, 2017.  Screengrab.

The final bill is similar to the draft in that it designates the Department of Commerce (DOC) as the “one-stop shop” in the government for companies that want to engage in commercial space activities.  The Federal Aviation Administration’s Office of Commercial Space Transportation (FAA/AST) would continue to facilitate, promote and regulate commercial launch and reentry, and the Federal Communications Commission (FCC) would continue to assign radio spectrum to commercial users, but everything else would go through DOC’s Office of Space Commerce (OSC).  OSC currently is part of NOAA.  It would be combined with NOAA’s Office of Commercial Remote Sensing Regulatory Affairs and the merged office elevated to a higher level in the DOC.  The head of the office would be an Assistant Secretary of Commerce.  The two offices have a combined budget of $1.4 million for FY2017.  The bill would authorize $5 million for FY2018.

Among the changes from the draft that was circulated several weeks ago are the following:

• Requires the Secretary of Commerce to issue “certifications” instead of “registrations” for U.S. entities to operate space objects. The distinction between a registration and a certification is not clarified, but the term is changed throughout the legislation. The requirement for DOC to establish a registry of objects of U.S. entities that are authorized and supervised to operate in outer space is eliminated.
• Strengthens a requirement for the Secretary of Commerce to consult with other agencies in deciding whether to grant certifications (“shall, as the Secretary considers necessary” instead of  “may, as the Secretary considers necessary”)
• Extends the time period by which the Secretary must decide to grant or reject a certification from 60 days to 90 days.

Until last fall, it appeared as though there was consensus in government and industry that responsibility for regulating new commercial space activities would be assigned to FAA/AST, which already regulates launch and reentry.  Bridenstine and George Nield, the head of FAA/AST, advocated expanding the office’s role to include in-space activities and in a report required by the 2015 Commercial Space Launch Competitiveness Act (CSLCA), the Obama Administration’s Office of Science and Technology Policy (OSTP) essentially recommended that course of action.  Bridenstine included that approach in a bill he introduced last year, the American Space Renaissance Act.

However, last October, Babin called for a “regulatory rethink” for commercial space regulation, which led to a hearing earlier this year on a “permissionless” approach to achieving the goal of ensuring that the United States fulfills its obligations under the Outer Space Treaty without stifling innovation.  The issues are complex and were also debated at a Senate hearing last month.

While there is general agreement that whatever regulation should have a light touch — “maximum certainty with minimal regulation” — debate continues over what federal agency should be in charge of whatever regulation there is.   This bill assigns it to DOC, but there are those who continue to view FAA/AST as the appropriate agency.

Johnson’s substitute amendment was to assign it to FAA/AST.  She argued that FAA/AST already has the organization in place to take on these additional duties rather than starting from scratch at DOC.  She said her amendment “builds on the highly successful FAA space launch licensing process and provides a clean, straightforward path for the certification of these innovative space systems.”  However, she withdrew the amendment saying “I can count, and realize that this amendment has very little chance of being adopted.”  She expressed hope that Democrats and Republicans can work together to reach consensus as the bill moves forward.

House Science, Space, and Technology Committee Ranking Member Eddie Bernie Johnson (D-TX) at markup of H.R. 2809, June 8, 2017.  Screengrab.

Smith, however, said he was “more than disappointed” that she had proposed the amendment and defended the process by which the bill was drafted and made available for comment, including making changes requested by Democratic members.  He said her amendment would “strangle an industry at its early stages” and have other negative consequences.

Bridenstine clearly changed his views from last year and now supports giving this authority to DOC instead of FAA/AST.  He did, however, offer an amendment today requesting that the Government Accountability Office (GAO) conduct a study of the pros and cons of elevating AST out of the FAA and into the Secretary of Transportation’s office, where it originally was located, to give it added visibility and resources. The amendment was adopted.  (He wrote a letter to GAO with the same request last month.)

A Perlmutter amendment was also adopted that added a task to be undertaken by a Private Space Activity Advisory Committee created in the bill.  The committee now also would be required to identify challenges the U.S. private sector is experiencing with “access to adequate, predictable, and reliable radio frequency spectrum.”

The committee’s verbatim summary of the bill’s key provisions as published in its press release is as follows:

• Create a single authority for U.S. authorization and supervision of nongovernmental space activities located at the Department of Commerce Office of Space Commerce
• Establish a transparent certification process in the least burdensome manner possible
• Provide greater certainty to assure nongovernmental space activities conform to the United States’ Outer Space Treaty obligations
• Address concerns that certified activities may pose a safety risk to existing federal government space systems
• Reform the space-based remote sensing regulatory process
• Preserve ability to condition remote sensing operations to protect national security
• Enhance national security by ensuring insight into operations and capabilities by creating a competitive environment that discourages offshoring