Mr. Chairman and Members of the Committee, I welcome the opportunity to address you today with respect to the status of the International Space Station Program. And I congratulate you, Mr. Boehlert, on your selection as Chairman, and look forward to working with you and the Committee.

We have made an amazingly successful start on a new space station, built by an international partnership. It will require genius, sacrifice and perseverance to make it a success over the next decade. The Station crew is presently bringing to life this most sophisticated research laboratory and this month will receive the Canadian Arm and more supplies and equipment. In the past 2 years, we have witnessed 13 highly successful flights and excellent on-orbit operations.

Almost all of the U.S.-developed hardware for the core Station is on-orbit or at the Kennedy Space Center being, prepared for launch. This long-awaited facility is becoming a reality. The men and women of NASA, our contractors, and international partners have accomplished an incredible amount of difficult and complex work. But they continue to face challenges as we collectively take a major step beyond previous experience. Station software and computational resources are unprecedented and much less tolerant of error than industry. Frankly, however, our ability to forecast the complexity of Station software engineering and technical support has missed the mark.

As you know, in July, we finally witnessed the launch of the Zvezda Service Module. The launch of the Expedition One crew in October marked the beginning of the orbital ISS operations environment. In effect, the “rubber finally hit the road.” Before that time, Station operation costs had been under-running. As late as August, in meeting with the OMB to discuss our budget forecast, we believed that the funds appropriated for FY 2001, coupled with uncosted carryover, would leave the Station program with just enough funds to meet FY 2002 requirements. We also recognized the post-2002 estimates were poorly understood and indicated that to the OMB.

In September, prompted by unexpectedly high monthly program spending rates, the Station Program Manager decided to reexamine the premise that the cost projections for assembly phase operations tended to be overstated. A new look at the operating costs and budgetary risks was undertaken in advance of the normal budget formulation cycle. Initial findings indicated higher FY 2001 costs and a significant FY 2002 shortfall. In November, we alerted OMB and discussed the need for an in-depth (“bottoms up”) assessment of anticipated program costs. We provided a preliminary assessment to the OMB on February 1, characterizing it as a “conservative,” probably overly cautious, estimate of a potential total program cost increase of about $4 billion over the 2002-2006 time period.

The President’s FY 2002 Budget Blueprint is a straightforward proposal for dealing with the projected growth. First, the Administration does not break the statutory ISS cost cap. Instead, funding previously targeted for specific program content beyond the U.S. “core” is redirected to offset the growth Second, NASA is to undertake reforms and develop a plan to ensure that future costs remain within the FY 2002 budget plan. An external review is to validate our revised cost estimates. Third, we are consulting with our international partners on approaches to provide additional capabilities beyond the U.S. “core.” And, finally, we have a charter to eliminate lower-priority activities in Human Space Flight and propose the use of the funding to meet Station needs.

The prospect of elimination of lower-priority activities has already led well-intentioned advocates to seek redress within the Congress. That, of course, is their right in a democracy. But, with a fixed budget, NASA must identify priorities and make difficult choices. We will openly discuss these prospective actions with the Committee, and seek your oversight and support. We will not go unilaterally.

We have enthusiastically accepted the challenge of the new Administration. I do not want to minimize the seriousness of the situation. We do not have all of the answers today, but do have a plan of action. Several months of hard work are ahead of us to refine our cost estimates, to have the credibility that goes with a thorough understanding of risks and an allowance for the unknown. And, we will subject them to an external independent review, the results of which will be provided to the Committee, along with appropriate options, for your consideration and action.

With regard to research, we are fully committed to deliver to orbit all of the research equipment planned for the next 3 years. And to get it there on time. Obviously, there are many in the research communities who have legitimate concerns about the impacts of the budget constraints and crew resource limitations. We are developing, a post-2004 research utilization strategy that will undergo their scrutiny and benefit from their prioritization and time-phasing of capabilities.

Let me note how pleased I am by the reaction of our International Partners, particularly our partners in Europe, who are productively engaged in discussions about Habitation capability and the Crew Return Vehicle. We will keep the Committee fully informed as we progress in those areas.

Finally, I must emphasize that this budget continues our commitment to ISS commercialization. Significant rack space is available to support worthy commercial payloads. We will continue to seek non-utilization opportunities so long as they result in reduced cost to the Government and we are continuing to plan for alternative Non-Government Organization (NGO) concepts for ISS utilization.

In closing, the President’s budget proposal is consistent with the
principles of preserving, the ability to accommodate international
hardware elements, maximizing high-priority research within
available resources, and preserving, readiness to pursue
contingency items in the future, if necessary.

Do we want to do more? You bet. Do we want to expand our exploration
beyond low-Earth orbit? Yes we do. But we cannot and will
not seek to do more until we demonstrate we can meet the
challenges we face today. We cannot build to the future until our
foundation is secure.

In my nine years as NASA Administrator, I have seen the men and women of NASA meet and overcome incredible challenges. This Committee has been stalwart in its support and yet careful and meticulous in its scrutiny. I would expect no less from the Committee today, and I welcome your questions.