Committee on Science


Ralph M. Hall, Texas, Ranking Democrat

July 17, 2000

Press Contacts:

Jeff Lungren (

Jeff Donald (

(202) 225-4275

Sensenbrenner Urges NASA Administrator Goldin to Open Living WIth A Star Contract To Competitive Bidding

Recent IG Report Finds “Insufficient Justification”
for Sole-Sourcing $600 Million Contract

WASHINGTON, D.C. — House Science Committee Chairman F. James Sensenbrenner,
Jr., (R-WI) in a letter today urged NASA Administrator Dan Goldin to “remove
the cloud of uncertainty” cast over NASA’s proposed Living with a Star
program by awarding the $600 million contract for part of the program only
after “full and open competition” for the contract. Chairman
Sensenbrenner’s action was sparked by a recent NASA Inspector General (IG)
report finding that NASA had “insufficient justification” for circumventing
the normal competitive bidding process by moving to directly award the $600
million contract. Chairman Sensenbrenner requested the IG look into NASA’s
decision to award the contract to the Johns Hopkins University Applied
Physics Laboratory (APL) without competitive bidding.

The Living with a Star program, proposed in the Administration’s FY 2001
budget request, is aimed at studying the Sun and its effects on humanity.
The program’s estimated total cost comes to more than a billion dollars over
the next decade.

“I’m bothered by NASA seeking to write $600 million dollar checks without
following the normal process of opening the contract to competitive bidding.
The American people deserve to know that they are getting the most for their
money when we spend hundreds of millions of their tax dollars on space
exploration programs which can be determined best through the competitive
bid process,” commented Chairman Sensenbrenner.

As the IG’s report points out, the Federal Government’s policy regarding
government contracts clearly requires full and open competition except under
very limited circumstances. NASA has asserted that awarding the contract to
APL without a competition is appropriate given that APL has “essential
capabilities” that must be maintained – a legal exclusion to the applicable
Federal statute.

Originally enacted to ensure the expertise needed to build critical – but
not commercially viable – defense-related products (such as submarines)
could be maintained, the exclusion NASA cites allows sole-sourced
(non-competitively bid) contracts when necessary to maintain such an
essential capability.

What “essential capability” NASA seeks to protect at APL, however, is
unclear. The IG determined that “our review did not find sufficient
justification for conducting a sole source procurement on the basis that
NASA needs to maintain essential capabilities at APL” and that “there is no
evidence to suggest that APL’s existing capabilities are at risk.” In
addition, NASA officials interviewed by the IG apparently gave reasons for
the need to sole-source the contract that differed from the reasons outlined
in NASA documents, leading the IG to find NASA’s justifications “vague and
inconsistent.” Nevertheless, in responding to the IG report, NASA stated
that this lack of consistency “does not mean the justification does not

Chairman Sensenbrenner added, “It seems NASA is taking a ‘decide first,
justify later’ approach in defending its decision to circumvent the normal
competitive bid process for a $600 million dollar job.”

Chairman Sensenbrenner’s letter is attached.

The NASA IG report is available at


July 17, 2000

The Honorable Daniel S. Goldin


National Aeronautics and Space Administration

Washington, DC 20546

Dear Mr. Goldin:

At my request, the Office of the NASA Inspector General (OIG) recently
reviewed NASA’s proposed sole source procurement to the Johns Hopkins
University Applied Physics Laboratory (APL) for services in support of the
Living with a Star initiative (LWS).

The OIG determined that there was insufficient justification for conducting
a sole-source procurement on the basis that NASA needs to maintain essential
capabilities at APL and labeled NASA’s description of APL’s essential
capabilities as “vague and inconsistent.” In addition, the OIG found that,
in conflict with NASA policy, NASA has not performed a cost/benefit analysis
of the proposed arrangement.

The response to the Inspector General’s report from Al Diaz, Director of
Goddard Space Flight Center, is far from satisfactory. While recognizing
that the results of the interviews conducted by the OIG “did not uncover
sufficient justification for other than full and open competition” Mr. Diaz
nevertheless states in his letter that “we believe the justification does
exist.” What Mr. Diaz is basing these assertions on is unclear, as the
rationalizations provided in his letter do not extend upon or illuminate the
fundamental conclusions drawn by the OIG about the appropriateness of
sole-sourcing the LWS contract. Mr. Diaz’s assertions, in the absence of
compelling supporting evidence, are not acceptable as a response to the
OIG’s findings.

The importance of full and open competition for government contracts is
clearly articulated in Federal statute [Title 10: United States Code
2304(a)(1)]. As such, the conclusions reached by the OIG in this matter
deserve serious and thoughtful attention.

Having a potential value of roughly $600 million, this contract is no small
matter, and I don’t believe NASA’s vague assertions justify its plan to make
a sole-source award. There are many excellent research institutions around
this country that should be afforded

the ability to submit proposals, but NASA appears to be committed to
precluding them from participating. I am not alone in having these
concerns. The House Appropriations Committee noted in the report
accompanying H.R. 4635, the FY 2001 VA-HUD Appropriations bill, that the
Committee was “concerned with the manner in which NASA is administering the

In the past, both you and I have been united in the belief that decisions
regarding the allocation of federal funds should be made on the basis of
merit. Given the OIG’s finding that there is not sufficient justification
to award the LWS contract to APL in the absence of competition, I strongly
urge you to remove the cloud of uncertainty cast over this ambitious new
initiative by awarding the LWS contract only after full and open

Should you choose to disregard the OIG’s findings and move forward with the
award of the LWS contract on a sole-source basis, I request that you make
any and all information supporting such a decision available to the House
Science Committee and the House Appropriations Committee before proceeding
with any steps towards the implementation of the program.





cc: Chairman C.W. Bill Young