U.S. House Approves One-year Launch Indemnity Extension

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WASHINGTON — The same week Space Exploration Technologies Corp. (SpaceX) launched its first commercial satellite, the U.S. House of Representatives passed a compromise bill that, at the behest of House Democrats who say they favor a broader revision of existing commercial space legislation, would extend the current indemnity regime for U.S. commercial launch companies for only a year.

The proposed one-year extension of a 25-year-old law that protects U.S. companies from third-party damage claims arising from catastrophic launch failures cleared the House Dec. 2 and now heads to the Senate for consideration. The Senate returns from recess Dec. 9 and has until Dec. 31 — when the indemnity shield expires — to reach some kind of accord with the House.

“While I would have preferred a longer extension, this bill buys us time to work on a long-term extension that we will take up next year,” House Science Committee Chairman Lamar Smith (R-Texas) said on the House floor Dec. 2.

House Republicans favor a five-year launch indemnity extension and included just such a measure in their NASA authorization bill, which, like its counterpart bill in the Senate, was approved in committee but never made it to the floor. With precious few legislative days left on the calendar, authorizers have given up on passing a NASA bill this year.

House Democrats said they need to hear more from experts in industry and the Federal Aviation Administration’s Office of Commercial Space Transportation, which promotes and regulates commercial launch and re-entry in the United States, before passing anything more than a stopgap extension.

A one-year extension “is an appropriate length,” Rep. Eddie Bernice Johnson (D-Texas), ranking member of the House Science Committee, said on the House floor. “The one-year extension provides the Congress with the time to conduct necessary hearings, perform our due diligence, and enable the enactment of a comprehensive update to existing commercial space legislation.”

The launch indemnity regime was established by the U.S. Commercial Space Launch Act Amendments of 1988 and has been renewed six times since, most recently at the end of 2012. The liability shield covers damage claims above and beyond those covered by the insurance the Federal Aviation Administration requires companies to purchase for each launch they carry out. No company has ever claimed indemnity in the 25 years the law has been on the books.

The cautious stance of House Science Democrats is in stark contrast with the ground Sen. Bill Nelson (D-Fla.), chairman of the Senate Commerce science and space subcommittee, has staked out on the other side of Capitol Hill.

On Nov. 20, a day before the Senate left for its Thanksgiving recess, Nelson tried to get a three-year indemnity extension, S. 1753, approved via unanimous consent. However, Nelson’s bill — like other proposed unanimous-consent measures — got hung up by the partisan spat about presidential appointees that was resolved only on Nov. 21, after which the Senate left town.

Now, the fate of Nelson’s bill remains unclear. A Senate source said Dec. 4 that discussions continued at the staff level about bringing the proposal back, but that no firm decision would be made until senators returned for their last legislative session before the winter holidays.

This is the second time in as many years that a multiyear extension, favored in no uncertain terms by industry groups including the Satellite Industry Association that has now testified multiple times before Congress, has fallen short at the last minute.

Last December, when SpaceX’s first commercial communications satellite launch was still a moving target on the calendar, Senate Democrats attempted to push a two-year extension through that chamber on a unanimous consent vote that was ultimately blocked by Sen. Richard Shelby (R-Ala.) — a standard-bearer for the NASA old guard and a staunch protector of the Marshall Space Flight Center in Huntsville, Ala.