Air Force is spending more on space, but modernization path still a big question

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WASHINGTON — In its budget proposal for the coming year, the U.S. Air Force is trying to send the same message to foreign adversaries and critics at home: the service definitely is not underestimating threats the United States and its allies face in space.

“The Air Force’s FY-19 budget accelerates our efforts to deter, defend and prevail against anyone who seeks to deny our ability to freely operate in space,” Gen. John “Jay” Raymond, commander of Air Force Space Command, said in a statement.

The unclassified space budget the Air Force unveiled in February includes $8.5 billion for investments in new systems — $5.9 billion in the research and development accounts, and $2.6 billion for procurement of satellites and launch services, according to a service official. The 2019 request is 7.1 percent more than the Air Force sought for 2018. Over the next five years, the Air Force projects to invest $44.3 billion in space systems — $31.5 billion in research and development, and $12.8 billion in procurement. That would mark an 18-percent increase over the $37.5 billion five-year plan submitted last year.

And there are additional space-related investments in the black world. “We know that classified spending is increasing, and that bodes well for space overall,” said Doug Berenson, managing director of the consulting firm Avascent.

Avascent estimates the Pentagon budgeted $48.7 billion for classified systems in 2019, compared to $43 billion in 2017. Congress has not yet appropriated funding for 2018, so Avascent compared the new proposal with 2017 levels. The classified budget includes aircraft, cybersecurity, electronic warfare and other items. Berenson believes that space is probably the biggest single category.

By Avascent’s calculation, unclassified space spending for 2019 total $7.3 billion, or $1.2 billion less than the Air Force’s number. Berenson said the difference is probably due to the Air Force counting ground-based equipment associated with space systems that Avascent includes in the C4ISR category.

Industry consultant Mike Tierney of Jacques & Associates also crunched the numbers and came up with a lower space total than the Air Force: $7.68 billion.

“There are multiple numbers floating around,” he said, noting the Air Force total and a $7.88 billion estimate for the broader unclassified DoD space budget “is what we can track back to what is publicly available.”

Late last week, Undersecretary of Defense for Policy John Rood told Congress that a total of $12.5 billion is in the president’s 2019 budget request “to take steps to establish a more resilient, defendable space architecture.” A DoD spokesman did not respond to questions on what is included in the $12.5 billion figure.

 



 

At a time when the Air Force is under political pressure to show it cares about space, “how you count is a non-trivial issue,” said Berenson. He noted that since 2017, when unclassified spending on space was under $5 billion, the 2019 proposal represents a 48 percent increase. “It’s a small baseline but a big jump,” said Berenson. “With the push on the national defense strategy to prepare better for peer competitors and contested warfighting domains, they want to spend a lot more on next-generation space and harden the existing capabilities.”

The new space budget shifts funding from the procurement of satellites to research and development. Most of the $2.5 billion space procurement account — down from $3.4 billion a year ago — is for big-ticket launches under the Evolved Expendable Launch Vehicle program. The Air Force is seeking nearly $1.8 billion for five launches, which averages $360 million per launch. The budget also provides $245 million for research and development towards a new rocket engine.

The pivot is most noticeable in the Space Based Infrared System (SBIRS) program, the satellite constellation that monitors missile launches around the world. The Air Force increased R&D for a new missile-warning constellation from $71 million to $643 million. It ends procurement of SBIRS satellites beyond No. 5 and 6, which already are in production at Lockheed Martin Space Systems. The SBIRS procurement account plummets from $1.1 billion in fiscal year 2018 to $138 million in 2019. Research and development for a next-generation system gets a boost from $382 million to $703 million.

The Air Force also is transitioning the Global Positioning System. The plan is to start a new program to succeed the block of GPS 3 satellites currently in production by Lockheed Martin. The Air Force intends to select a new design and seek new competitors. The budget adds more money for future GPS 3 research and development — from $1 billion to $1.4 billion — and cuts procurement from $101 million to $85 million.

The Air Force is boosting R&D for protected satellite communications. Research on a future replacement for the Advanced Extremely High Frequency (AEHF) constellation is getting a big bump from $315 million to $677 million, whereas procurement goes down from $138 million to $91 million. Four satellites have been delivered by Lockheed Martin, and two more are in production.

The budget funds the 10th and final Wideband Global SATCOM satellite. The 2019 request includes nearlu $50 million to complete the Air Force Commercial Satellite Communications Pathfinder projects, which are exploring ways to work with commercial fleet operators to reduce cost and improve satcom resilience.

Berenson cautioned that the Air Force moving money out of procurement into R&D should not be read as a sign of some radical change in direction. “Programs have ebbs and flows” as satellites age and new ones have to be developed. “That’s likely the case with navigation satellites and evolved SBIRS,” he said. “A lot of this is about existing programs.”

The takeaway is that the Air Force “hasn’t yet figured out what its next generation of major space procurements is really going to look like,” said Berenson. “They are still trying to figure how much money they are really going to have long term. The 2019 budget is a big increase but it’s not going to go on forever. They’re trying to get a handle on what they can expect.”

Another issue for DoD is how to work differently with the private sector, said Berenson. “There is so much dynamism in this industry. New players are disrupting the market and coming up with new concepts on how to provide capabilities, he said. “I’m not sure the department is yet in a position to describe the end-to-end plan for what they are going to be acquiring. They are still working on what the architecture ought to look like.”

Raymond noted in his statement that increased spending in R&D shows a deliberate effort to move to next-generation systems.

“We are demonstrating our commitment to innovation, rapid acquisition and to building more defendable, resilient and capable space systems,” he said.

“We ultimately seek to deter a conflict that extends into space. However, we must be ready to fight and win if deterrence fails.”

 

This article originally appeared in the March 12, 2018 issue of SpaceNews magazine.