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FAA 3rd Annual Commercial Space Launch Forecast Conference

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The Honorable Neal Lane
Assistant to the President for Science and Technology

FAA 3rd Annual Commercial Space Launch Forecast Conference

February 8, 2000

Thank you Patti, I'd also like to thank you for inviting me to join you this afternoon.  It's apparent that you've put a lot of hard work into making this a first class event and I am delighted to be here.

Some of you may know that I had the pleasure of accompanying the President and the First Lady to Kennedy Space Center in October 1998 to witness the launch of the Space Shuttle Discovery that carried John Glenn into space for his second mission.  Seeing, hearing, and feeling the power of that launch was truly an experience that can only be described using superlatives as many of you know.  It's no wonder people the world over recognize the phrase “rocket science” as a reference to the most complicated, challenging, and technically demanding of human endeavors.

Experiencing that launch in person gave me a deep sense of respect for the U.S. space launch industry and the space professionals entrusted with sustaining such an awe-inspiring and practically important capability for our nation.  I am pleased to be here today with the leaders of a vital sector of America's 21st century economy.   Our space launch capability is critical to the overall strength and stability of our commercial, civil and national security space sectors.  As we enter the 21st century, reliable access to space will be more important than ever in accomplishing our national goals.

I'm counting on you;  the President is counting on you;  and the nation is counting on you -- to complete the process you're engaged in now:  to fix the recent launch problems;  to safely fly out the important remaining missions that rely on the heritage systems;  and to transition to new systems and capabilities that will bring us reliable U.S. space launch capability for the future at lower costs.

I know that some of the recent scrutiny of the space launch industry has been difficult, including  the President's request to the Secretary of Defense to report to him in November on the causes and corrective actions to recover from the U.S. space launch failures that occurred in 1998 and the opening months of 1999.  In response to the President's direction, DoD conducted a comprehensive review of practices, procedures and operations.  The DoD review team included representatives from major U.S. aerospace companies, including Lockheed Martin and Boeing, and it considered the results of the independent reviews commissioned by these two companies.

Both the DoD and industry reviews addressed similar issues and concerns.  These included the importance of retaining workers with critical skills, establishing clear accountability at all levels of government and industry, accurately translating engineering intentions into actual hardware and software, and establishing manufacturing processes that are resistant to human error.  The DoD review also noted the importance of defining a clear transition plan, taking into account these lessons learned, for the operation of new launch systems.

The President has received the report, commended DoD and industry for taking corrective actions, and asked the Secretary of Defense to implement appropriate actions to correct the causes of the failures and ensure our nation's ability to reliably access space in the future.

We're now in the process of recovering from the toughest period for space launch activities in almost 15 years. You are engaged in a very serious, high stakes, high profile game where, in carrying out each critical step to prepare for a launch, you only get “one strike and you're out.”  I want to thank you for sticking with it.

And that's why I'm pleased to be able to share with you today two pieces of good positive news that demonstrate the Administration's deep commitment to advancing our partnership with industry to improve our nation's access to space.  First I'll talk about NASA's Space Launch Initiative.  Then, I'll take a few minutes to comment on the report that resulted from our launch base and range review.

As many of you know, this Administration has long been a strong supporter of efforts to reduce space transportation costs.  The President's National Space Policy, for instance, encourages government agencies to buy commercial launch services to leverage investments and innovation.  As another example, the President's National Space Transportation Policy led to the DoD-industry partnership that's developing the EELVs.

NASA, too, has made significant strides in the past six years in reducing launch costs.  It has reduced Space Shuttle costs by about a third while increasing safety by about a factor of two.  But if we're going to push the envelope of space exploration, launch costs have to come down much further.  To that end, the President's National Space Policy called for NASA to work with industry to develop flight demonstrators to support a decision by the end of the decade on
development of a next-generation reusable launch system.  NASA and industry have worked together on the X-33, X-34, and X-37, and they are applying the lessons learned from these programs to our future plans.  We have worked hard with industry over the past two years to develop an integrated strategy that will produce dramatic safety, reliability, and cost improvements.  That consultation resulted in a major initiative that was unveiled yesterday in the President's FY 2001 Budget.

The goal of this Space Launch Initiative is for NASA to meet its future space flight needs, including human access to space, using commercial launch vehicles that will reduce cost and improve safety and reliability.  We designed this initiative around four principles:

Commercial Convergence – flying on privately owned and operated launch vehicles;

Competition – bringing innovation and new ideas to bear;

Assured Access – ensuring alternate means of getting to space despite launch mishaps;

The Ability to Evolve – adding new capabilities affordably as new mission needs emerge.

NASA will undertake three major activities through this initiative:

First, NASA will invest to reduce technical risk and initiate full-scale development of competing, privately owned reusable launch vehicles by 2005 so they will be operational by 2010;

Second, NASA will develop hardware that can be flown on these commercial launch vehicles to meet the agency's unique needs; and

Finally, NASA will seek to procure commercial launch services to provide near-term assured access to the International Space Station.

The initiative is funded at $4.5 billion over five years ($290 million in FY 2001 ramping up to $1.3 billion per year), which more than a doubles the $2 billion, five-year total that was included as a decision placeholder in the President's FY 2000 Budget.

We are committed to continued safe Shuttle operations and we have integrated Space Shuttle safety investments into our strategy. The President's FY 2001 budget provides $2.2 billion over five-years for Shuttle safety improvements through hardware and software upgrades and investments in personnel and facilities, a $1.7 billion increase over last year.  NASA intends to have these upgrades in place by 2005.

The Space Launch Initiative is an extremely ambitious undertaking.  If successful – and I'm confident it will be – it will dramatically alter the economics of space launch.  I believe that this Space Launch Initiative could ultimately have as profound an impact on space exploration and space commerce as anything our nation has ever attempted.

NASA's Marshall Space Flight Center Director, Art Stephenson, will be here later today to give you more details and address your questions on NASA's Space Launch Initiative.

The second thing I'd like to tell you about today is the completion of the White House-led interagency review on the future management and use of the U.S. space launch bases and ranges.  Today we are releasing the interagency working group's report.  This review was initiated by Sandy Berger and myself in March 1999.  NSC and OSTP co-chaired the interagency government team, including DoD, DOT, Commerce, and NASA, and sought inputs from industry and spaceports.

Over the past five years, a significant transition has occurred in the demand for space launch services.  U.S. commercial launch rates have more than tripled since the early 1990s and now make up about 40 percent of the manifest.  In recognition of this new reality, early last year Secretary of the Air Force Whit Peters established a Task Force to synthesize the results of more than 20 launch-related studies since 1990, and develop recommendations for action—not more studies.

His Spacelift Task Force consolidated the results of the Air Force Scientific Advisory Board, General Henry's Range Integrated Product Team, the National Launch Capabilities Study, the Commercial Space Opportunities Study, and many others.

Our interagency team started with the Air Force results and expanded the effort to include inputs and evaluations by the FAA, NASA, and the U.S. commercial space sector, including the spaceports.  To develop an overall national strategy and recommendations, the team examined historical developments and current range modernization efforts in the context of current and projected government and commercial demand.

So what did the review come up with?  Vic Villhard, my Assistant Director for Space and Aeronautics, will be here later this afternoon to go into more detail, but here is a brief rundown.

All of the near-term recommendations focus on expanding the federal-state-industry partnership to enable more direct involvement of civil and commercial space sector users, including spaceports.  The recommendations address the following ideas:
Alternative management processes to allow U.S. commercial and government users to have a greater voice in improving operational flexibility and efficiency of the ranges.

Use of nonfederal funding where appropriate—especially from states and spaceports—for the maintenance and modernization of the launch bases and ranges to meet national needs.

Options for replacing the “excess capacity” construct in the current law to allow a more complete federal-state-industry partnership to develop.

Common range safety requirements for government and commercial launches at federal and nonfederal launch sites.

Next-generation range technology development and demonstration, with a focused charter to improve safety, increase flexibility and capacity, and lower costs for reusable and expendable launches.

The working group recommended a national strategy that will allow commercial launch markets and capabilities to develop and grow without the government pre-selecting or precluding a later transition to any one of a variety of alternative futures.  Under this strategy, the government would pursue changes in law to eliminate constraints and enable a more complete partnership to form with the U.S. commercial space sector.  Market forces and the pace of new commercial developments should help determine the future role of commercial industry with respect to the ranges.  But for now, the future of commercial markets and developments is too uncertain to justify selecting one far-term alternative to pursue

The report does not endorse transferring ownership or responsibilities for operations to a private or state-sponsored entity in the near term.  There is
and will continue to be a significant level of national security activity and interest in maintaining the government's space launch bases and ranges.  However, if commercial markets and capabilities develop in a way that makes it feasible for states or commercial entities to generate a viable and sustainable business case for operating and sustaining the launch bases or ranges, the report recommends that the U.S. government seriously reconsider the merits of such a transition.
I want to emphasize that this is not just another launch study.  Rather, it is a description of the consensus view at the highest levels of our government as to what we should do.  The interagency team's report and recommendations have been approved by the Secretaries of Defense, Commerce, and Transportation, the National Reconnaissance Office, and the NASA Administrator.

Our next step is to present the recommendations for approval by the President and subsequently, to provide policy guidance for implementation by the Departments and Agencies of the Executive Branch.

In closing, I'd like to emphasize once again that the Administration's overarching policy on space is to take advantage of the synergies among the U.S. civil, commercial, and national security space sectors.  We're just starting to see the real power of the commercial sector in space.  The space industry is on a path to continue developing and offering new and expanded capabilities and services that will change the world in many ways, for civil, commercial, and national security customers.  I applaud your efforts to address the challenges these new developments will bring, and especially for recognizing the importance of partnerships in most effectively fulfilling the nation's interests in space.

We are committed to work with you to insure America's continued leadership in space.

Thank you very much.

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