In the matter of buying commercial products and services, NASA’s guidance, both in U.S. law and policy, is clear: if such services are available, needed and cost-competitive with comparable government offerings, the agency should utilize them. It is a reasonable standard that balances the government’s responsibilities to spend U.S. taxpayer dollars wisely and to nurture a healthy private sector.
NASA Administrator Michael Griffin has consistently delivered a similar message to the entrepreneurial community, with the caveat that the agency’s role is that of a customer, not an investor. NASA is providing some seed money in the case of the Commercial Orbital Transportation Services (COTS) program, which is designed to encourage the private sector to develop an alternative means to deliver cargo to the international space station. But COTS is a special case, an allowance for the reality that without some government aid, there is almost no chance that a commercial U.S. space station logistics service would materialize.
If COTS is an exception to Mr. Griffin’s non-investment principle, one company’s bid to commercialize NASA’s aircraft-based microgravity program looks like a perfect fit. Zero Gravity Corp. (Zero-G) already has made a business of offering weekend rides to the public aboard a Boeing 727-200F aircraft that flies a series of nosedives to provide brief periods of weightlessness. Now the company is eyeing NASA business, and has secured access to the aircraft on a full-time basis under an arrangement with its partner, cargo carrier Amerijet International. Moreover, Zero-G says it intends to make $2.5 million worth of modifications to the aircraft to meet NASA’s requirements.
But there is a problem. NASA in 2005 acquired a Boeing DC-9 aircraft from the U.S. Navy to replace its storied KC-135 microgravity research and training aircraft, affectionately known as the Vomit Comet. If the agency now opts to procure microgravity flight services from Zero-G or some other company, it would have to write off its investment, which includes some $6 million worth of modifications and repairs to the DC-9.
In addition, there are jobs at stake. Outsourcing microgravity flight services would leave a number of civil servants at NASA’s Johnson Space Center, which hosts the modified DC-9, with little to do. Mr. Griffin has expressed an inclination to find work for idled NASA civil servants rather than reduce their numbers — and risk incurring the wrath of Congress.
Having found itself in an uncomfortable bind, NASA now plans to solicit industry bids next year on airborne microgravity services and compare the resulting price proposals with the cost of maintaining and operating that capability in house. The agency also is considering an option in which it would pay a contractor to operate the DC-9, presumably at Johnson.
Congress and the White House should keep a close eye on NASA as the process unfolds.
First off, NASA needs to account in some way for the fact that Zero-G and other commercial entities have government-imposed costs that the agency does not have to bear, including taxes on assets and Federal Aviation Administration certification fees. These costs, after all, put money into the federal coffers.
NASA also should think twice about omitting from its analysis the $6 million already spent on the DC-9 modifications. That is a sunk cost, to be sure, but it begs the question of why NASA chose to invest that money knowing full well that it had a viable commercial alternative in Zero-G. In any event, to get a true cost comparison that eliminates one-time anomalies, NASA needs to run its analysis far enough into the future to cover one or two recapitalization cycles.
Any proposal that would have NASA retain ownership of the DC-9 with a private company managing its operations should be viewed with suspicion. Such arrangements can be attractive because they give a program a commercial-like veneer, but in substance they do very little if anything to change the status quo. The guidelines directing NASA to use commercial services were not written simply to make workers switch from government to contractor badges; they are designed to help stimulate private-sector growth while helping the agency to operate more efficiently.
Zero-G, for its part, must recognize that NASA has alternatives, and structure any service offering accordingly. That means avoiding contracts that would force the agency to sign up for more services than it truly needs.
Assuming a fair offer from industry, NASA should consider accepting it even if it means taking a financial hit in the short term. The process of testing commercial services to see if they can truly offer the government a better deal while benefiting the economy has to start somewhere. If a company like Zero-G, which raised its own money and has been operating since 2004 without reliance on NASA contracts , does not provide an opportunity, it is hard to imagine what will.
