Senate defense appropriators take issue with agencies that buy launch services directly from providers

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Appropriators questioned “recent moves by some agencies to procure launches outside of the space launch enterprise through direct commercial contracts or delivery on orbit contracts."

WASHINGTON — The Senate Appropriations Committee in a report Nov. 10 criticized the practice by some agencies of procuring launch services directly from commercial providers, bypassing the National Security Space Launch program run by the U.S. Space Force.

Appropriators expressed these concerns in an “explanatory statement” accompanying the $696 billion markup of the Defense Department spending bill for Fiscal Year 2021 released on Tuesday. 

The committee questioned “recent moves by some agencies to procure launches outside of the space launch enterprise through direct commercial contracts or delivery on orbit contracts,” the report said.

Agencies such as the National Reconnaissance Office procure delivery-on-orbit contracts for classified payloads. These are contracts for complete end-to-end services that include the satellite and the launch bundled into the same contract. 

Many NRO missions are launched by the U.S. Space Force under the National Security Space Launch program. The commercial delivery-on-orbit launches are funded separately from the NSSL program and are not made public.

The Pentagon’s Space Development Agency last month issued a solicitation for launch services for 28 satellites. The agency asks bidders to provide a delivery-on-orbit service which requires the contractor to determine the number of launches needed to meet the SDA’s requirements.

Senate appropriators said they are concerned that agencies are going directly to launch companies and bypassing the NSSL program to save time and money but in the process are undermining NSSL because the program is not benefitting from economies of scale.

The NSSL Phase 2 contract is “designed to lower the costs of the most stressing national security requirements by leveraging buying power across a multitude of mission types,” appropriators wrote.

The committee understands why agencies choose to go outside NSSL for “lower value missions or those missions requiring a rapid launch timeline” but warns that cost and schedule savings in individual programs are achieved at the expense of “the government as a whole.”

The Senate defense markup directs DoD and the intelligence community to “utilize the Space Force launch enterprise for NSSL class missions unless the Secretary of Defense or Director of National Intelligence certifies to the congressional defense and intelligence committees that commercial launch procurement for a designated mission is in the national security interest and best financial interest of the government.”