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Commercial Space News

Restoring Ex-Im Bank Effort Gets a Boost As Discharge Petition Succeeds

Marcia S. Smith
Posted: 09-Oct-2015 (Updated: 09-Oct-2015 10:49 PM)

Congressional efforts to reauthorize the Export-Import Bank took a step forward today when a sufficient number of House members signed a discharge position to move legislation, H.R. 597, out of the Financial Services Committee and onto the House floor for a vote.  The vote could take place as early as October 26, the day the House returns from a week-long recess.

Three Republican Congressmen, Steve Fincher (Tennessee), Adam Kinzinger (Illinois) and Chris Collins (New York) filed the discharge petition today, a procedural step to discharge a bill from the committee of jurisdiction so it can be voted on by the House when the committee itself will not do so.  Fincher is the sponsor of H.R. 597. 

House Financial Services Committee Chairman Jeb Hensarling (R-Texas) opposes the Bank and has been using his position as chairman of the Bank's oversight committee to prevent Fincher's bill, the Reform Exports and Expand the American Economy Act, from moving to the House floor for a vote.  The issue also is divisive in the Senate, but that chamber has managed to pass legislation reauthorizing the bank.  The Senate-passed legislation has been blocked in the House, however, where House Majority Leader Kevin McCarthy (R-California) also opposes the Bank.

It is highly unusual for the members of a political party to challenge their own leaders so publicly, but they believe that a majority of the House supports the Bank and the obstacle to its reauthorization is only a small, but powerful group of their own members.

Fincher revealed his strategy to circumvent Hensarling and other Republican leaders last week and today followed through.  In a joint statement, Fincher, Kinzinger and Collins said the discharge petition is intended "to stand up to Washington's broken system that is killing thousands of American jobs and jeopardizing thousands more. ... If we do not get this done for the American people, the only thing our country will be exporting is jobs."

Hensarling issued his own statement asserting that a majority of Republicans on his committee did not want a House floor vote on the issue.  "I respect my colleagues who believe Ex-Im is essential economic development, just as I respect those who believe Ex-Im is unfair and harmful corporate welfare."  He warned his Republican colleagues that signing the discharge position contradicts regular order and puts Democrats in charge (because a large number of Democratic signatures are needed).  "Let Democrats own corporate welfare all by themselves.  Republicans should instead focus on reforms that will give every American opportunities to succeed" such as "fundamental tax reform, tort reform and regulatory reform."

A discharge petition requires a majority of House members -- 218 -- to sign and exactly that number did so today.  According to the tally from the House Clerk's office, 42 Republicans and 176 Democrats signed the petition.  The bill should now move to the floor for a vote.  The House is in recess next week, but a vote could come on October 26 when it returns.

The Bank has been unable to issue new loans since its authorization expired on June 30.   It finances U.S. exports abroad, including aerospace products such as communications satellites.  The Aerospace Industries Association (AIA) and Satellite Industry Association (SIA) both advocate for the Bank.  SIA issued a statement earlier this week calling for its reauthorization.

The Bank was created in 1934, but its charter must be periodically reauthorized by Congress, something done routinely over the decades.  Since last fall, however, the reauthorization has become a matter of bitter debate. The issue splits the Republican and Democratic parties with some members of each insisting that the bank is essential to U.S. exports and therefore to U.S. jobs, while others assert it is corporate welfare for a few big companies.  Boeing is often mentioned in the latter regard.  Advocates claim that small and medium size businesses also benefit not only because of their own projects, but because many are suppliers to the big companies. 

The Bank's authorization expired on June 30 after an attempt to reauthorize it failed.  Another attempt in July met the same fate.   The Bank currently cannot make new loans, only administer those already in force.

McCarthy Withdraws from Speaker Race, Path Forward Uncertain

Marcia S. Smith
Posted: 08-Oct-2015 (Updated: 08-Oct-2015 03:55 PM)

In a stunning development today, Rep. Kevin McCarthy (R-CA) pulled out of the race to replace John Boehner (R-OH) as Speaker of the House.  McCarthy was the favorite to win, but ran into opposition from the far right wing of his party.  The House Republican Conference was supposed to choose its candidate for Speaker today, but that has been indefinitely postponed.  What will happen next is unclear.

McCarthy is currently the House Majority Leader, second only to Boehner in rank.  In announcing his withdrawal from the Speaker race, he said he would retain his current position.

Boehner and McCarthy both are conservatives, but not as conservative as the Tea Party.   McCarthy needed 200 votes from his Republican colleagues to move forward as the party's candidate for Speaker and it appeared that he easily had that many.   But he did not have the magic number of 218 -- the votes needed to secure the Speakership when the full House votes.   Tea Party Republicans in the House Freedom Caucus threw their collective strength behind another candidate, Rep. Daniel Webster (R-FL), making it very difficult to get 218 supporters.

In a brief press conference after he announced his decision, McCarthy said the Republican party needs to be unified and the new Speaker needs not just the 218 votes to win the election in the House, but all 247 Republican votes.  "To unite, we probably need a fresh face," he said, a nod to critics in the far right wing of the party who claimed he would continue Boehner's legacy.  Those critics contend that Boehner does not fight hard enough for Tea Party causes like repealing the Affordable Care Act (Obamacare) or defunding Planned Parenthood and believe that government shutdowns are a valid and useful political tool.  Repeated clashes with those critics, including over the recent Continuing Resolution (CR) that is funding the government through December 11, are credited as leading Boehner to abruptly announce his resignation last month, though Boehner insists that he was planning to step down anyway on his birthday in November.

In a statement today, Boehner said he would not leave until a new Speaker is in place.  He had been planning to leave on October 30.  The leadership election will take place "at a later date, and I'm confident we will elect a new Speaker in the coming weeks," he said.

While McCarthy is generally well-liked by his colleagues, recent comments got him into trouble.   For example, during a television interview he used the House committee investigating the 2012 Benghazi, Libya incident as an example of effective Republican leadership that caused Hillary Clinton's poll numbers to drop.   The comments severely undercut Republican contentions that the committee is not politically motivated.  Four Americans, including Ambassador J. Christopher Stevens, died in the attack on an American diplomatic compound in that city.  During his press conference today, McCarthy agreed that he could have phrased his comments better and the only reason the committee exists is to "find the truth" for the families of the victims:  "I should not be a distraction from that."

What all this means for conducting the nation's business is not comforting.  Congress must pass a Highway Trust Fund reauthorization by October 29, raise the debt limit by November 5, and pass another bill to keep the government operating after December 11.   Boehner, President Obama, and Senate Majority Leader Mitch McConnell (R-KY) also recently pledged to work together on a high-level budget deal that hopefully would avoid any chance of a government shutdown between now and the 2016 elections.  All three oppose using government shutdowns as political tools.  Today's developments make the outcome of all of those issues even more murky.

Commercial space advocates were looking forward to the possibility of a McCarthy Speakership since he represents the district in California where Edwards Air Force Base and the Mojave Air & Space Port are located.  He is the chief sponsor of H.R. 2262, the Spurring Private Aerospace Competitiveness and Entrepreneurship (SPACE) Act, which passed the House in May.

Webster and Rep. Jason Chaffetz (R-UT) are the only other two announced candidates for Speaker at the moment, but everything clearly is in flux right now.

Senate Passes Final FY2016 NDAA, Will President Veto It?

Marcia S. Smith
Posted: 07-Oct-2015 (Updated: 07-Oct-2015 06:34 PM)

The Senate today joined the House in passing the final version of the FY2016 National Defense Authorization Act (NDAA).   The bill now goes to the President, but White House spokesman Josh Earnest said last week the President would veto it.

The Senate passed the compromise version by a vote of 70-27. 

  • Three Senators did not vote: presidential candidates Marco Rubio (R-FL) and Lindsey Graham (R-SC), and Pat Roberts, R-KS. 
  • The no votes were cast by 24 Democrats, 2 Republicans (presidential candidates Ted Cruz, R-TX, and Rand Paul, R-KY) and 1 Independent (presidential candidate Bernie Sanders).
  • The yes votes were from 49 Republicans, 20 Democrats and 1 Independent.

The party split is important because the Senate could end up voting on whether to override a Presidential veto.  Two-thirds of the Senate, 67 Senators, would have to vote in favor of overriding a veto for such a vote to succeed.  Today's vote has the requisite number, though it is far from clear that all 20 Democrats would make the more difficult political choice to overturn a veto by their own President.

The House approved the compromise 270-156.  In the House 290 votes would be needed to override a veto, so that vote hinted that a veto would be sustained.

The veto threat is because the bill uses what its detractors call a "gimmick" to provide more money for defense than is allowed under the spending caps set by the 2011 Budget Control Act.  Republicans added $38 billion for defense in an off-budget account, Overseas Contingency Operations (OCO), to circumvent the caps.   Democrats also do not like the caps, but want them to be renegotiated for all spending, defense and non-defense.  President Obama, House Speaker John Boehner (R-OH) and Senate Majority Leader Mitch McConnell (R-KY) recently agreed to high-level budget talks, but Boehner's imminent departure and the transition to a new House Speaker will complicate that effort.

The bill authorizes $604 billion for defense according to a Congressional Research Service (CRS) summary (other sources use other figures).  That includes $496.4 billion for DOD's base budget plus $89.2 billion for OCO (another $18.5 billion is for atomic energy defense activities).  The OCO funding is $38 billion above the President's request and, as noted, that spending is off-budget and does not count against the cap.

Republicans argue that the bill does not spend any money -- it is an authorization, not an appropriation -- and therefore should not get caught up in the broader budget debate.  They want the bill enacted because of its policy provisions and other guidance, with the budget issues dealt with in the appropriations process.  Democrats, however, feel that enacting this bill would set a bad precedent on the funding front.

Among the policy provisions in the bill is the number of RD-180 rocket engines the United Launch Alliance (ULA) would be able to obtain for national security launches.  The bill adopts the Senate position of allowing only nine more engines, rather than the 14 ULA wanted. 

Under a block buy contract signed in December 2013, before Russia's actions in Ukraine chilled U.S.-Russian relations, ULA planned to obtain 29 RD-180 engines from Russia for its Atlas V rockets.  Following the geopolitical downturn, Congress decided that the United States should not rely on Russian engines to launch national security satellites.  In addition, it wanted the Air Force to allow new entrants like SpaceX to compete against ULA for national security launches.  The FY2015 NDAA put restrictions on how many RD-180s ULA could obtain for national security launches (they do not affect commercial or civil government launches).  ULA had completed purchase of 15 of the 29, while payments for the other 14 were not finalized.  The Air Force determined that only five of the 14 could be obtained under the terms of the FY2015 NDAA.  The Air Force and ULA have been seeking relief from the NDAA language, but the Senate, in particular, wants to hasten the transition from Russian engines to a new U.S.-built engine as well as allow competition. The Senate version of the FY2016 NDAA allowed four more to be obtained, for the total of nine.  That position was upheld in conference.

The bill has a number of other policy provisions related to space activities.  Among them is a restriction on the use of both FY2015 and FY2016 funds for the Defense Meteorological Satellite Program (DMSP) and the launch of the last satellite in that series (DMSP-20) until the Secretary of Defense (SecDef) and Chairman of the Joint Chiefs of Staff (CJCS) certify that the DMSP-20 launch is necessary and the most affordable solution to defense weather satellite requirements.  The bill also restricts funds for a DOD follow-on weather satellite system until the SecDef develops a plan for providing cloud characterization and theater weather imagery, briefs Congress on that plan, and the CJCS certifies the plan meets the needs of the commanders of combatant commands.  Furthermore, the bill prohibits DOD from relying on Russian or Chinese weather satellite data. 

DOD is still regrouping from the 2010 cancellation of the DOD-NOAA-NASA National Polar-orbiting Operational Environmental Satellite System (NPOESS).  NPOESS was intended to merge the separate military and civil weather satellite systems, but was terminated by the White House after years of cost overruns and schedule delays.  The two sectors were directed to resume separate systems.  NOAA moved out with a successor program, the Joint Polar Satellite System (JPSS), but DOD is still determining its path forward while relying on the legacy DMSP series.  Several DMSP satellites were purchased in a block buy and put in storage.  DMSP-20 is the last, but DOD has been ambivalent about whether it needs to be launched or not.

SIA: Ex-Im Impasse Killing U.S. Contracts, Congress Must Fix

Marcia S. Smith
Posted: 06-Oct-2015 (Updated: 06-Oct-2015 12:41 PM)

The Satellite Industry Association (SIA) renewed its push to convince Congress to reauthorize the Export-Import Bank today.  The industry organization said that at least three satellite manufacturing contracts have been lost since the Bank was closed to new business on July 1.

SIA and other aerospace industry organizations and companies have been warning Congress about the need to keep the Ex-Im Bank operating since last year when its usually routine reauthorization came into question.  The Bank was created in 1934, but needs to be reauthorized periodically.   It provides financing for sales of U.S. goods overseas, including aerospace products such as communications satellites.

The Bank's existence was threatened about this time last year, but Congress temporarily reauthorized  it through June 30, 2015 in the FY2015 Continuing Resolution (CR).   Congress did not pass a reauthorization by that date, however, and another attempt in July also failed.  The Bank cannot make new loans, only administer those already granted.

The debate pits very conservative Republicans and very liberal Democrats against the rest of their parties.   Opponents argue it is "corporate welfare" for a few big companies like Boeing, while advocate argue that small and medium companies also benefit directly or indirectly because they are suppliers to the big companies.

SIA and the Aerospace Industries Association (AIA) have written to Congress and issued press releases in the past supporting the Bank.  More recently, some of the affected companies have come out publicly themselves to highlight the impact on their businesses.   Individual companies often are reluctant to discuss specific contracts because they are proprietary, but Boeing has been particularly vocal in recent months, and at a September Washington Space Business Roundtable panel discussion, Orbital ATK identified a contract it says it lost because of the impasse.  

In today's statement, SIA President Tom Stroup said that U.S. companies have had "at least three pre-existing commercial satellite orders withdrawn, lost other awards, and been barred from other competitions already."   Calling that just "the tip of the iceberg," he exhorted Congress to reauthorize the Bank.  "Our industry can dominate the market if Congress ensures a level playing field with European satellite manufacturers, all of which have access to foreign [Export Credit Agency] support." 

SIA calls itself "the unified voice of the U.S. satellite industry" and has more than 35 members, including Boeing and Orbital ATK.   It said today that since 2010, 16 satellite projects worth $4 billion have been financed by the Bank "supporting tens of thousands of U.S. jobs."  It asserts that satellites form the largest growth category of Ex-Im financing and has "generated a net profit ... returning funds to U.S. taxpayers."

The Senate has managed to pass provisions to extend the Bank, but they were blocked in the House.  The House Republican leadership has not allowed them to be debated on the House floor.  Rep. Steven Fincher (R-TN), a Republican who supports the Bank, reportedly is planning to use a procedure called a discharge petition to get the issue out of the Financial Services Committee and onto the House floor where he and other advocates believe they have more than enough votes to pass a reauthorization.

What's Happening in Space Policy October 5-9, 2015

Marcia S. Smith
Posted: 04-Oct-2015 (Updated: 07-Oct-2015 10:02 AM)

Here is our list of space policy events coming up during the week of October 5-9, 2015 and any insight we can offer about them.  The House and Senate are in session.

During the Week

Today is the 58th anniversary of the Space Age.  The Soviet Union launched Sputnik on October 4, 1957, the first artificial satellite to orbit the Earth.  Nine months later, after considerable debate and many hearings, Congress passed the National Aeronautics and Space Act of 1958.  President Eisenhower signed it into law on July 29, 1958 and NASA opened its doors on October 1, 1958.   Hard to imagine anything happening that fast these days.

Kicking the can down the road seems to be the best Washington can manage at the moment.  Congress passed a Continuing Resolution (CR) last week to keep the government operating through December 11 without resolving the issues that have prevented the 12 regular appropriations bills from getting passed.   Now there will be a leadership transition in the House.  The election of a new Speaker to replace John Boehner (R-OH), who is leaving at the end of the month, will take place on Thursday.   Majority Leader Kevin McCarthy (R-CA) is still the favorite despite controversial comments he made over the past week.   Two others have announced their own candidacies, Rep. Jason Chaffetz (R-UT) and Rep. Daniel Webster (R-FL).  If McCarthy wins, there definitely will changes in other leadership positions since his current post will become vacant, and if one of the others wins, changes also are possible.

Against this backdrop, Congress has a very busy schedule between now and December 11.  Must-pass bills include reauthorizing spending from the Highway Trust Fund (another issue that was kicked down the road in July when it was given a 3-month extension that expires on October 29), raising the debt limit by November 5, and, of course, doing something about appropriations before the CR runs out.  Many consider the FY2016 National Defense Authorization Act another must-pass bill and the House and Senate did reach a compromise on it, but most Democrats on the conference committee refused to sign the report and the White House has threatened to veto the bill.  The House passed the compromise last week and the Senate is supposed to take it up this week.  The fate of other bills, such as the House and Senate commercial space bills or attempts to reauthorize the Export-Import Bank, remains up in the air.  The provision in existing commercial space law that had to be dealt with -- the learning period for commercial human spaceflight regulations -- because it would have expired on September 30 was given a 6-month extension (to April 1, 2016) in a hastily passed airport and airways bill that extended a number of expiring provisions to give Congress more time to deal with them.

The only space-related hearing that we know about as of Sunday morning is a House Science, Space, and Technology Committee Space Subcommittee hearing on Friday.  The topic is "Deep Space Exploration: Examining the Impact of the President's Budget" with two former NASA human spaceflight officials (Doug Cooke and Dan Dumbacher) as witnesses.

NASA Associate Administrator Robert Lightfoot will talk to the Space Transportation Association (STA) on Wednesday.  The event is by invitation only, so we do not list it on our calendar, but anyone who is interested can contact STA's Rich Coleman at  The NASA Advisory Council's Planetary Science Subcommittee meets on Monday and Tuesday, and a National Academy of Sciences committee reviewing progress in achieving the vision outlined in the 2010 astronomy and astrophysics decadal survey meets in open session on Thursday and Friday.  All of those are in Washington, DC.

Elsewhere in the United States, the annual ISPCS (International Symposium on Personal and Commercial Spaceflight) is on Wednesday and Thursday in Las Cruces, NM, and there's a LunarCubes workshop in San Jose, CA from Tuesday to Friday.    NASA will hold two briefings on Wednesday at Vandenberg Air Force Base, CA about cubesats that are flying on a National Reconnaissance Office (NRO) launch scheduled for Thursday.  NASA sponsored four of the 13 cubesats that will tag along on the launch and funded a fifth in conjunction with NRO.  The remainder are NRO's.

Elsewhere in the world, pre-meetings begin for the annual International Astronautical Congress (IAC), which will be held in Jerusalem, Israel next week.  The IAC combines meetings of the International Astronautical Federation (IAF), International Academy of Astronautics (IAA), and International Institute of Space Law (IISL).  IAC officially begins next Monday (October 12), but the associated 3-day Space Generation Congress starts this Thursday and the IAA has meetings over the weekend.

Those and other events we know about as of Sunday morning are listed below.  Check back throughout the week for any additional events we learn about and post to our Events of Interest calendar on the right side of's main page.

Monday-Tuesday, October 5-6

Tuesday, October 6

Tuesday-Friday, October 6-9

Wednesday, October 7

Wednesday-Thursday, October 7-8

Thursday, October 8

 Thursday-Saturday, October 8-10

Friday, October 9

Clarification:  The vote on Thursday for a new Speaker of the House is within the House Republican Conference for who the Republicans will advance as their candidate for the official election of a Speaker by the full House on October 29.

Discharge Petition Could Be Next Step for Ex-Im Bank Reauthorization

Marcia S. Smith
Posted: 01-Oct-2015 (Updated: 02-Oct-2015 12:36 AM)

Supporters of the Export-Import Bank may try a new tactic to put the institution back in business -- National Journal is reporting that a discharge petition may be filed to get the issue out of committee and to the House floor.  Advocates have often said that a majority of House members support the bank, but the House Republican leadership is preventing them from having a chance to vote on it.

The Bank helps provide financing for U.S. exports, including communications satellites, for example.  Created in 1934, its charter must be periodically reauthorized by Congress, something done routinely over the decades.  This year, however, the reauthorization has been a matter of bitter debate. The issue splits the Republican and Democratic parties with some members of each insisting that the bank is essential to U.S. exports and therefore to U.S. jobs, while others assert it is corporate welfare for a few big companies.  Boeing is often mentioned in the latter regard.  Advocates claim that small and medium size businesses also benefit not only because of their own projects, but because many are suppliers to the big companies.

The Bank's authorization expired on June 30 after an attempt to reauthorize it failed.  Another attempt in July met the same fate.   The Bank currently cannot make new loans, only administer those already in force.

Boeing chairman, W. James McNerney, Jr said in July that the whole point of the Bank is to level the playing field with foreign competitors and If there will be no U.S. Ex-Im Bank, "we are actively considering now moving key pieces of our company to other countries and we never would have considered it before this craziness on Ex-Im." He called it "the triumph of ideology over any description of private business."   Boeing is the biggest beneficiary by dollars, he agreed, but not by transactions:  "There are more deals for small and medium size companies than big companies.  The congressional situation is a "sign of dysfunctionality" when two-thirds of the House and of the Senate support reauthorization, but legislation cannot pass because of the "extremes" of the two parties.

Boeing and Orbital ATK reportedly have lost satellite business already because of the inability of the Bank to make new loans.

In the House, the challenge has been that the chairman of the Financial Services Committee, Rep. Jeb Hensarling (R-TX), supported by members of the House leadership, opposes the bank and has not moved legislation out of his committee to reauthorize it. 

National Journal reports tonight, however, that Rep. Stephen Fincher (R-TN) is planning to use a procedure called a discharge petition to move a bill out of that committee and to the floor of the House for a vote.  As explained in a Congressional Research Service report, a discharge petition requires 218 signatures.  Signing a discharge petition might be viewed as an affront to House leadership, making it a difficult decision for Republican members and at least 30 Republican signatures would be needed if all 188 Democrats signed (and there is no guarantee of that).

House rules (Rule XV, clause 2) establish time periods for when discharge petitions may be filed and when they may be considered on the floor, so it could take some time for this to play out.  It is possible that outgoing Speaker John Boehner could decide to bring a bill to the floor and avoid the need for a discharge petition that could pit Republicans against Republicans.  If not, this will be one more issue to land in the lap of his successor.

Even if the bill does pass the House, it still, of course, must pass the Senate where the issue is equally divisive.

Congress Passes Short-Term Continuing Resolution for FY2016

Marcia S. Smith
Posted: 30-Sep-2015 (Updated: 30-Sep-2015 07:11 PM)

First the Senate and then the House passed a Continuing Resolution (CR) today to keep the government operating tomorrow when FY2016 begins.  The CR lasts through December 11, 2015.

The Senate vote was 78-20.  All 20 no votes were Republicans.  Republican presidential candidates Cruz and Paul voted no, while Graham and Rubio did not vote.  The 78 yes votes were 32 Republicans, all 44 Democrats, and both Independents.  Democratic presidential candidate Sanders (who is an independent in the Senate) voted yes.  The chairman of the Senate Appropriations Committee (who also chairs a subcommittee) and 6 other subcommittee chairs voted yes, and 4 voted no, including Sen. Richard Shelby (R-AL) who chairs the Commerce-Justice-Science (CJS) subcommittee that funds NASA and NOAA.  One (Graham) did not vote.

The House vote was 277-151.  All 151 no votes were Republicans.  All 186 Democrats who voted and 91 Republicans voted yes.    The chairman of the full appropriations committee, Rep. Hal Rogers (R-KY) and nine of the 12 subcommittee chairs voted yes. Two voted no.  One, Rep. John Culberson (R-TX), who chairs the House Appropriations CJS subcommittee, did not vote.

Congress is using the TSA Office of Inspection Accountability Act, H.R. 719, as the legislative vehicle for the FY2016 CR.   The operative part for the CR is Senate Amendment 2689 (SA 2689). 

Agencies are funded at their FY2015 levels except that there is an across-the-board 0.2108 percent reduction to ensure the total does not exceed agreed upon budget caps.

The President is expected to sign the bill, keeping the government open until December 11.  What will happen at that point is anyone's guess.

House and Senate Agree on FY2016 NDAA, RD-180s Still Restricted

Marcia S. Smith
Posted: 29-Sep-2015 (Updated: 29-Sep-2015 10:51 PM)

The House and Senate Armed Services Committees (HASC and SASC) announced agreement today on a compromise version of the FY2016 National Defense Authorization Act (NDAA).  HASC Chairman Mac Thornberry (R-CA) said that he expects the bill to reach the floor of the House for debate on Thursday.  One thorny space-related issue, on use of Russian RD-180 rocket engines, was resolved largely in the Senate's favor.

Broadly speaking, the House, Senate, Air Force, DOD, and United Launch Alliance (ULA) agree that the United States should not rely on Russian rocket engines to launch U.S. national security satellites.   ULA was created in 2006 as a joint venture between Lockheed Martin and Boeing and has been essentially a monopoly launch services provider to the national security community since then.  ULA's Atlas V rocket uses Russian RD-180 engines.  From an engineering standpoint, the RD-180 apparently is an excellent engine and users are reluctant to give it up.

However, the advent of "new entrants" like SpaceX into the launch vehicle market, and the deterioration in the U.S.-Russian relationship following Russia's actions in Ukraine, marked a paradigm shift in the U.S. launch vehicle industry last year.   SASC chairman Sen. John McCain (R-AZ) has been particularly strident in his views that the United States should not be paying money to Russia for rocket engines that goes into the pockets of "cronies" of Russian President Vladimir Putin.  He also strongly supports the entry of SpaceX as a competitor to ULA.   

In last year's FY2015 NDAA, Congress set 2019 as a deadline for when RD-180s should be replaced by a new domestic rocket engine for national security launches (the provision does not affect the use of Russian engines for commercial or other government launches).  Flexibility was provided by giving the Secretary of Defense waiver authority to certify that additional Russian engines were needed for national security purposes, but the Air Force and DOD have been fighting to get the 2019 deadline extended to 2022 to 2023.  They argue that while a new U.S. engine could be ready by 2019, it would take several years to integrate it into a new rocket and certify the rocket for launching expensive, vital national security satellites.  HASC has been more sympathetic to that view than SASC.

The Senate version of the FY2016 NDAA kept the 2019 deadline and said only nine more RD-180 engines could be obtained.  The House version provided substantial flexibility by expanding the Secretary of Defense's waiver authority.

The compromise version announced today mostly adopts the Senate language.  At a press conference today, McCain vehemently reiterated his opposition to paying Russia for RD-180 engines and his support for SpaceX.  He said that SpaceX asserts that it can have a domestic engine ready to replace the RD-180s by 2017.  The compromise still allows the use of nine more RD-180s, he said, as his committee recommended.  He added, though, that the language does allow more to be purchased if needed "but to commit to 6-7 [more] years is not something I'm prepared to do."  He criticized the ULA-Air Force relationship on this issue as a "classic example of the military-industrial complex."

In a separate press conference, the four Republican and Democratic leaders of HASC and SASC also addressed the issue.  Thornberry said "we want to wean ourselves off of Russian engines as soon as possible and have assured access to space as we do it" and that is what the compromise language does.  HASC ranking member Adam Smith (D-WA) added that "I think we're going to get to a good place sooner than most people realize," but stressed that  "we don't want just one alternative" to the RD-180s. There are companies out there, a number of them happen to be in the State of Washington, as a matter of fact, Blue Origin, Aerojet, bunch of other folks, and they'll get there sooner than we expect. Still, "we can't ... count on that and say that we can't buy the only thing that's actually available."  The language in the bill ensures DOD "has good choices," he remarked, but also pushes "domestic industry to quickly develop an alternative domestically."

Blue Origin and Aerojet Rocketdyne are competitors in developing a new engine for ULA's planned Vulcan rocket that will eventually replace both the Altas V and Delta IV, ULA's other rocket.   ULA and Blue Origin announced a partnership last fall where ULA said it would use Blue Origin's BE-4 engine for Vulcan.  The BE-4 is an innovative design that uses methane (liquefied natural gas) and liquid oxygen (LOX) as propellant.    ULA said this spring, however, that it is also considering a traditional LOX/kerosene engine being developed by Aerojet Rocketdyne, the AR1, and will make a choice between them next year. Blue Origin is headquartered in Kent, Washington and Sacramento-based Aerojet Rocketdyne has a major facility in Redmond, Washington.  Aerojet Rocketdyne is trying to buy ULA, adding further complexity to the outlook for the U.S. launch services market.

ULA and Blue Origin said last fall that the BE-4 engine is fully funded and no government funds are required, although ULA President Tory Bruno said this spring that he certainly would not turn down government help.   Aerojet Rocketdyne has indicated that it does need government funds.   The compromise version of the NDAA authorizes $184.4 million.

The NDAA is an authorization, not appropriations, bill, so its funding levels only are recommendations.   Democrats still want a grand deal on replacing sequestration, and not only for defense, but for domestic priorities as well.  They object to a maneuver Republicans are using for FY2016 defense spending by putting money into an off-budget account, Overseas Contingency Operations (OCO), to get around the existing budget caps.  McCain and Thornberry argue that since the NDAA is only an authorization bill, that debate should not derail this bill.   SASC ranking Democrat Jack Reed (D-RI), said at the press conference today, however, that he would oppose the bill on those grounds.

Senate Joins House in Extending FAA Learning Period For Six Months

Marcia S. Smith
Posted: 29-Sep-2015 (Updated: 04-Oct-2015 02:18 PM)

The Senate passed a bill today that extends certain FAA airport and airway provisions, including the so-called "learning period" during which the FAA cannot issue new passenger safety regulations for commercial human spaceflight.  The bill now goes to the President.

The bill, H.R. 3614, the Airport and Airway Extension Act, was introduced on Friday and passed the House yesterday.  No hearings or markups were held.  It passed the House under suspension of the rules.   Today it passed the Senate by unanimous consent.

Under existing law the prohibition, or moratorium, on new regulations would expire tomorrow (September 30).   Both sides of Capitol Hill have passed commercial space bills that would extend it for several years, but they have not reached agreement on a compromise.   H.R. 2262 would extend it to 2025; S. 1297 would extend it to 2020.

The House and Senate bills cover a wide variety of commercial space issues and have many differences.   The existing learning period provision is the only one with an imminent expiration date, so a quick fix was needed.  The 6-month extension will give conferees time to reach agreement on a final version of a new commercial space bill.

Under this legislation, the learning period is extended until April 1, 2016.

Senate Advances CR; Shutdown Fears All But Over -- For Now

Marcia S. Smith
Posted: 28-Sep-2015 (Updated: 28-Sep-2015 08:51 PM)

The Senate advanced a Continuing Resolution (CR) to fund the government through December 11, 2015 today, all but ending fears of a government shutdown on October 1.  House Speaker John Boehner's surprise announcement on Friday that he is stepping down sharply diminished the chances of an October 1 shutdown, but may make a December shutdown instead more likely.

By a vote of 77-19, the Senate agreed to let the CR move forward.  A final vote is expected tomorrow.   It is a "clean" bill without a policy rider sought by some ultra-conservative Republicans to defund Planned Parenthood. 

Assuming the Senate approves the bill tomorrow, it will go to the House where the betting today is that it will pass.  Now that he has announced his departure on October 30,  Boehner is more free to focus on his goal of keeping the government operating rather than negotiating with the right-wing of his party that vowed not to vote for any bill that did not defund Planned Parenthood. 

Boehner and his Senate counterpart, Sen. Mitch McConnell (R-KY), have been saying all year that they will not permit another government shutdown like the one in 2013.  In that case, Tea Party Republicans led by Sen. Ted Cruz (R-TX) refused to agree to a bill that did not repeal the Affordable Care Act (Obamacare).  After 16 days, Boehner decided to reopen the government by going against that wing of his party and using Democratic votes to pass the bill.   It is widely expected that he will do the same when this Senate bill reaches the House tomorrow or Wednesday.  

Congress must pass an appropriations bill by midnight Wednesday, the last day of FY2015, in order for the government to open for business on Thursday, the first day of FY2016.

The bill has not passed yet, however, and it is unwise to heave a sigh of relief until it does.  Even then, it may be short-lived.   Boehner is leaving on October 30 and a new Speaker will have to deal with the same forces in the Republican party to get appropriations passed for the rest of the fiscal year.  House Majority Leader Kevin McCarthy (R-CA) formally announced his candidacy for Speaker today and many consider him the odds-on favorite, but Tea Party challengers are expected.

Whoever wins, the issues are likely to remain the same, so this is just kicking the can down the road.  For those worried about whether the government will be open on Thursday, however, it is good news.