Senate Bill Would Again Delay Full Commercial Space Regulation

by

WASHINGTON — Despite the Federal Aviation Administration’s well-established position that it is time to begin regulating commercial spaceflight, a long-awaited Senate bill would extend industry’s regulatory grace period another five years, to 2020.

The bill, set for a May 20 markup in the Senate Commerce, Science and Transportation Committee, would also officially extend the U.S. commitment to the International Space Station by four years to Sept. 30, 2024 — a goal the White House endorsed in 2014 but which would not become the law of the land unless the latest commercial space bill is signed.

In congressional testimony in 2014 —  more than six months before a fatal crash of Virgin Galactic’s SpaceShipTwo suborbital tourism vehicle — George Nield, head of the FAA’s Office of Commercial Space Transportation, told Congress the government has enough data to begin crafting safety regulations for the budding commercial spaceflight industry and that it would be “irresponsible” not to.

Then in April, Nield told the FAA-chartered, industry-led, Commercial Space Transportation Advisory Committee he was concerned “that we appear to be just kicking the can down the road,” when it comes to regulation.

Now industry, which has not wavered from its position that regulations will only stifle a fledgling business already struggling to get off the ground, appears poised to secure another kick of the can with the “U.S. Commercial Space Launch Competitiveness Act,” a draft of which was obtained by SpaceNews the week of May 4.

The bill, sponsored by presidential hopeful Sen. Ted Cruz (R-Texas), chairman of the Senate Commerce space, science and competitiveness subcommittee, would amend the existing Commercial Space Launch Amendments Act of 2004. An industry source said the proposal is on a fast track through the upper chamber, and that the House of Representatives is close to consensus on its own version of the bill.

Eric Stallmer, president of the Washington-based Commercial Spaceflight Federation advocacy group, said the Senate’s bill “will continue to encourage growth in commercial spaceflight and reduce the cost of access to space.

“Regarding ‘kicking the can down the road,’ we see it differently,” Stallmer wrote in a May 8 email. “This isn’t industry versus government, it is industry working with government to continue the U.S.’s leadership in space and push Earth’s economic sphere increasingly outward.”

The Senate bill would not entirely stifle FAA’s ability to get its regulatory wheels turning.

The proposal makes clear the FAA is allowed “to discuss potential regulatory approaches with the commercial space sector, including observations, findings, and recommendations from the Commercial Space Transportation Advisory Committee, prior to the issuance of a notice of proposed rulemaking.”

In the specific case of the SpaceShipTwo accident, FAA already has the authority to do more than discuss potential rules; it is allowed to respond to serious accidents with new safety rules, provided those rules are limited to the accident that triggered them. In other words, any regulatory response to the SpaceShipTwo crash would not apply to the broader commercial space industry.

George Nield, FAA associate administrator for commercial space transportation, is worried Congress is “kicking the can down the road” on commercial space regulation. Credit: FAA

Besides extending industry’s regulatory grace period, the Senate’s bill would give U.S. commercial launch providers another four years of federal indemnification against catastrophic launch failures.

The U.S. government requires launch companies to purchase insurance to protect uninvolved parties from potential rocket failures but will step in to pay for damages beyond $500 million. Under the latest commercial space bill, launch indemnification would be extended through 2020; currently it is set to expire at the end of 2016. The government has never had to cover damages from a U.S. commercial launch.

The Senate bill also would require the Department  of Transportation to examine, and if necessary change, the formula FAA uses to calculate the amount of insurance a commercial launch company needs to carry for each launch. The Transportation Department must include both the launch and insurance industries in this evaluation, according to the bill.

In addition, the bill clarifies that commercial space companies that obtain an FAA permit for experimental spacecraft flights may continue to use that permit for non-revenue test flights even if they subsequently acquire a license for commercial flights.

Industry last year worried that the licenses needed to fly paying customers might, due to the FAA’s interpretation of the Commercial Space Launch Act as written, invalidate experimental permits. Permits are easier to get than licenses and impose fewer restrictions on flights. Industry maintains it must operate fast-paced test programs in parallel with commercial flights to stand any chance of turning a profit.

Furthermore, the bill directs the FAA to streamline its licensing and permitting process “to improve efficiency, reduce unnecessary costs, resolve inconsistencies, remove duplication, and minimize unwarranted constraints.”

Commercial space companies currently need a license or permit not only to launch spacecraft, but to bring them back to Earth. For example, SpaceX’s cargo missions to the International Space Station for NASA require both launch and re-entry permits because the Hawthorne, California, company’s Dragon spacecraft carries loads of return cargo back to Earth after each resupply mission.