Op-ed | Straight Talk Regarding Air Force Launch Contract
This op-ed originally appeared as a “My Take” guest column in the Feb. 29 issue of SpaceNews’ biweekly magazine.
History was made Feb. 5 when United Launch Alliance launched the 12th GPS 2F satellite to complete a constellation that modernizes this indispensable capability for the U.S. Air Force and billions of GPS users around the world.
This was ULA’s 104th successful launch, an unprecedented record of success that has led many to think of the physics-defying act of space launch as an almost routine activity.
What is little known is that the journey of that satellite actually began in 1998. And therein tells a tale that is relevant to the current — and often misleading — debate over ensuring future launch capability for U.S. national security missions.
There has been a tremendous amount of rhetoric and misinformation regarding a contract my company has with the Air Force, commonly referred to as “ELC.” The Evolved Expendable Launch Vehicle (EELV) Launch Capability contract ensures safe, reliable and on-time launch services for our country’s most critical national security space satellites.
Critics have asserted that ULA receives $800 million per year in a contract “for doing nothing,” stating that it was a “retainer” or “subsidy” for ULA to “stay in business” for the Air Force. This is untrue and reveals a fundamental lack of understanding of this innovative contracting mechanism.
In simple terms, we have two contracts; one to build the rockets, and one to fly rockets. ELC flies the rockets. ELC’s well-defined scope begins with the transportation of the stages from ULA’s Decatur manufacturing facility to the launch site and continues through all of the operations necessary to launch. Without ELC, most of our nation’s national security satellites would simply have no access to space.
In the early 2000s, the Air Force found itself in a predicament. Many of its current wave of new satellites were delayed, some by years, causing a ripple effect with the launch vehicles contracted to take them to space. As I mentioned, the GPS mission that just launched, was originally put on contract in 1998, more than 17 years ago! In the past, when the government contracted to launch satellites individually and then experienced delays in satellite delivery, significant disruptions to the manifest were experienced, accompanied by cost increases and delays. ELC avoids these penalty costs and disruptions.
With ELC, the government essentially says to ULA, “I intend to fly eight times this year. Here is our best guess as to which satellites will be ready and when. But, if we’re wrong, you handle it and just make it happen.” A typical manifest will have 12 launches, with 10 of those being shuffled to accommodate satellite availability or changing priorities and all in a way which is nearly seamless to our customer.
ELC has very specific scope. As I said, it transports the boosters to the launch site. It assembles them together and mates the satellite. ELC maintains, prepares and refurbishes the pad, which takes a beating with every launch. It buys the rocket fuel, pays the range fees, and rolls us out to the pad. ELC pays for my engineers who design a unique trajectory for every flight and for my mission assurance team who scrub and scrutinize every part on the rocket, as well as every line of software to make sure our mission success record continues. It pays for the team you see in mission control making the big moment happen, as well as the labs and infrastructure that allows all of them to do their jobs.
Let me be clear. These are costs all launch providers have and charge to their customers. Manufacturing and launch are separated into two contracts at ULA because that is the path our Air Force customer chose in its previous acquisition strategy.
In 2013, the Air Force awarded a Block Buy contract for EELV that included rocket manufacturing and ELC elements. The Government Accountability Office has certified that this two-prong approach has avoided launch delays and will save taxpayers $4.4 billion.
This unique contracting approach provides the government with maximum flexibility, at the lowest cost, supporting versatile operations on two coasts across a wide variety of satellites and destination orbits. It avoids penalty costs when satellites are late or out of order because it obligates ULA to a total number of launches in a year, while not specifying exactly which satellites are to be launched when. For example, if one of the large communications satellites is running late, the Air Force can substitute a GPS launch in its place with no penalties or additional costs.
Conversely, a fixed-price arrangement could result in intolerable schedule delays and cost increases for the Department of Defense as manifest-induced change orders would result in contractual modifications.
While this approach has served the nation well for the past decade, both ULA and the Air Force recognize a need to address the current approach for future launch services. However, changing that structure is complex and requires a thoughtful and strategic transition plan.
Ending this contract early would create a substantial bill for the Air Force because they would have to fully fund, in a single year, the launch costs for all 78 rockets ULA is under contract to manufacture. ELC allows the Air Force to separately and incrementally fund launches, one year at a time.
Ending it abruptly, without a clear plan and adequate transition, could result in critical national security assets sitting on the ground without a way to space.
Following a recent hearing, Lt. Gen. Arnie Bunch, the Air Force’s deputy assistant secretary for acquisition said, “The Air Force’s initial research has shown early termination of the contract could increase costs and cause schedule delays.”
ULA is willing to convert the existing ELC contract to another contracting method, but the current Air Force budget would simply not be able to accommodate that transition in one year.
I am proud to lead the company that has placed more than 100 satellites with 100 percent mission success that protect and keep our troops safe. These critical assets monitor enemies, enable communications, and provide positioning for our military’s precision-guided weapons.
The topic of national security launch should not be taken lightly or boiled down to misleading sound bites. Our country and the troops defending our freedom deserve better.
Tory Bruno is the president and chief executive officer of United Launch Alliance.