Space Act Agreement Training Urged for NASA Procurement Personnel

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WASHINGTON — A NASA effort to kick-start a U.S. commercial spaceflight industry using minimally restrictive funding awards called Space Act Agreements received a generally positive review in a recent watchdog report.

However, the Government Accountability Office (GAO) said in the report that NASA should institute formal training programs for its procurement personnel, who currently receive no instruction from the agency about the alternative procurement approach.

While NASA has adopted internal controls to prevent a single official from unilaterally approving the use of a funded Space Act Agreement, “the agency does not require or offer training specific to the use of funded Space Act agreements,” the GAO wrote in the Nov. 17 report. “This could affect NASA’s ability to ensure this authority is used appropriately and effectively.”

As of Oct. 31, NASA has awarded $833.1 million through funded Space Act Agreements, under which companies receive tranches of funding for meeting self-imposed milestones, the GAO report said. This includes NASA’s efforts to foster both crew- and cargo-carrying spacecraft for the international space station. The five companies that currently have funded Space Act Agreements with NASA — Blue Origin, Boeing, Orbital Sciences, Sierra Nevada Corp., and Space Exploration Technologies Corp. — could receive as much as $248.3 million in the first half of 2012, assuming they complete their remaining milestones on time, the GAO said in the report. The GAO produced the report at the request of the leadership of NASA’s oversight committees in the House and Senate.

Space Act agreements, which NASA is empowered to enter into as part of the law that created the agency in 1958, are not bound by the strict federal acquisition regulations that govern traditional government contracts. Since 2006, funded Space Act agreements have been the backbone of the agency’s initiatives to nurture a U.S. commercial spaceflight industry, whose spacecraft NASA could contract for cargo and crew transportation to the international space station.

NASA, in its response to the Nov. 17 report, told the GAO that it has not trained up its procurement personnel because funded Space Act Agreements account for a tiny fraction of contracts the agency awards.

A former government lawyer who now consults on government procurement said that “one of the consistent criticisms” of so-called Other Transactions, such as NASA’s Space Act Agreements, is that government personnel are poorly trained in their implementation.

“How you approach these things is really quite different from the normal mindset that government people have,” said Richard Dunn, a former general counsel for the U.S. Defense Advanced Research Projects Agency who has also worked for NASA.

“There’s a huge culture difference in dealing with this open, freedom-of-contract, almost commercial-like dealing, as opposed to the normal culture that government attorneys and contracting people come to the table with,” Dunn told Space News in a Nov. 23 phone interview.

To date, none of the companies that have received awards under NASA’s Commercial Orbital Transportation Services (COTS) or Commercial Crew Development programs, the agency’s banner Space Act agreement initiatives, has sent spacecraft to the international space station.

Space Exploration Technologies Corp. has come closest, successfully sending its Dragon space capsule into orbit in December 2010 aboard the company’s Falcon 9 rocket. The Hawthorne, Calif.-based company holds a traditional NASA contract worth $1.6 billion to make cargo runs to the space station, but it must first complete a prerequisite demonstration mission to prove Dragon can safely berth with the orbital outpost. The mission was originally to be flown in 2009. It is now scheduled to launch in early January.

Similarly, Orbital Sciences Corp. of Dulles, Va., has a $1.9 billion contract to deliver supplies to the space station with its Taurus 2 rocket and Cygnus capsule, but is not scheduled to make its prerequisite demonstration run to the space station until the spring.

The COTS agreements held by Space Exploration Technologies and Orbital Sciences Corp. are worth $396 million and $288 million, respectively.

NASA’s Commercial Crew Development program, which is aimed at fostering development of human-rated transportation systems, doled out funded Space Act Agreements to six different companies since 2009. The first round of Commercial Crew Development awards provided $50 million in funding to five companies. A second round of awards totaling $269 million was made in March to a slightly different mix of four companies.

NASA is now preparing to solicit bids in December for the next phase of its Commercial Crew Program, which is proceeding under a traditional procurement track. NASA says a traditional procurement is necessary because the agency plans to procure a service at the end of the next phase of crew-system development. By law, NASA may not use a Space Act Agreement if it is procuring a good or service for its own use.