WASHINGTON, D.C.—The United States has long been a world leader in using space for societal and commercial benefits.  Satellites, for example, provide us with instant communication, the indispensable Global Positioning System – or GPS – for navigation, and weather data to inform forecasts that prevent loss of life and property.  While the original investment for each of these examples came from the federal government, the commercial sector went on to make them profitable industries.  

The commercial sector is now looking at space transportation and the market that may emerge as the next big business opportunity, and that’s what this hearing will consider here today.  NASA’s purpose in the development of domestic commercial space flight capabilities is to lower the cost of getting crew and cargo back and forth to the International Space Station.  

Lowering the cost of access to space is not just important to NASA, but to the defense and intelligence communities, as well as satellite broadcasting and communications providers, just to name a few.  But if NASA’s investment is to pay off in seeding this “commercial” industry, there are tough questions that need to be asked regarding the taxpayers’ investment.  What have these programs cost NASA so far; how are the funded companies performing; and, above all, how cost effective will these service providers be once NASA has invested in their development?

It is important to remember that as soon as there is a domestic capability, NASA is required by law to stop purchasing Russian Soyuz seats to get to the International Space Station.  What is to stop a company from turning around and charging the government a fortune to access our space station?  Much has been said about not wanting the government to pick winners and losers, which is why we should not lock in a dominant player at this stage of the game.  Key to the premise of competition, however, is whether or not a viable market for commercial space emerges beyond the federal government.

As these companies work to attract private investment, we hear repeatedly that they need certainty and stability both for investors and the emerging market; however, “certainty” and “stability” only seem to apply in certain situations.  Many companies have advocated that extending the government’s indemnification of third party liability adds certainty and stability; however, some of these same companies argue that FAA regulation at this time does not.  Many advocated and were successful in obtaining a continued moratorium on FAA’s regulation of crew and passenger safety until October 2015 in the FAA Reauthorization.  I didn’t like this provision then, and I don’t like this provision now, as it increases the chances that regulation will be decided in reaction to an accident.  Space flight is inherently risky and we know accidents happen.  

With these questions in mind, I welcome our witnesses here today to help the Committee with its policy deliberations and oversight responsibilities in this area.

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