Testimony by NASA Administrator Dan Goldin on NASA’s FY 2002 Budget Request before the House Subcommittee on Space and Aeronautics

Statement of

Daniel S. Goldin, Administrator

National Aeronautics and Space Administration

before the

Committee on Science House of Representatives

Mr. Chairman and Members of the Committee:

I am pleased to be here today to present to you NASA’s budget request for FY 2002.

As I look back at the year that has just concluded, I am filled with pride at what the NASA team has accomplished and with excitement for the many challenges that still lay
ahead. What a year we have had! NASA flew the Shuttle Radar Topography Mission, the data from which is now being used to produce the most accurate digital elevation
model ever of the Earth’s land surface. The Hubble Space Telescope continued to provide the world with breathtaking images as it unlocks the secrets of the universe and
rewrite astronomy textbooks. The Mars Global Surveyor brought us detailed pictures of the surface of Mars, providing more clues and compelling evidence that suggests water
once flowed freely on the planet’s surface. Back on Earth, NASA researchers brought a pulse of light to a complete stop, held it in place, and then were able to activate the
light pulse again; this achievement has significant ramifications for new technologies in computing and communications. Space Station assembly and outfitting continued on
schedule with 4 Shuttle flights, including the delivery of the Expedition One crew, which established continuous human presence in space, and the deployment of the U.S.
laboratory. The NASA team also coordinated the successful launch of 6 ELV missions, including the Geostationary Operational Environmental Satellite-L, the Tracking and
Data Relay Satellite-H, the Imager for Magnetopause-to-Aurora Global Exploration mission, the NOAA-L weather satellite, the Earth Observing-1 satellite, and the Satellite
de Applicaciones Cientificas-C mission.

The Administration’s FY 2002 request for NASA is a solid and businesslike budget plan. The proposed funding level of $14.5 billion reflects an increase of 2-percent, or $258
million over the FY 2001 enacted level, and a 7 percent increase over FY 2000. The budget plan represents a deliberate prioritization of efforts within each Enterprise, to
ensure that we live within our means. It provides a disciplined budget plan for International Space Station development and operations, consistent with a strategy of
constraining Space Station cost growth, by offsetting growth through budget reductions in Station hardware and other Human Space Flight programs. NASA will undertake
significant management reforms and budget restructuring to bring Space Station costs under control. The President’s FY 2002 budget provides ongoing support to fly the
Space Shuttle safely while calling for a prioritization of Shuttle safety upgrades and infrastructure improvements within the proposed budget runout. The President’s budget
also calls for advancing the privatization of Space Shuttle activities. It reflects a strong commitment to continued execution of the Space Launch Initiative, reflecting NASA’s
commitment to provide commercial industry the opportunity to meet NASA’s future launch needs and to dramatically reduce space transportation costs while improving space
transportation safety and reliability. It funds a more robust Mars Exploration Program by redirecting funding from lower priority Space Science efforts. It provides increased
funding for science-driven, prioritized, follow-on missions for second-generation Earth Observing System measurements that will provide greater understanding of how the
Earth and its climate are changing; this increase is accomplished by identifying offsets within lower priority elements of the Earth Science program.

The President’s budget also recognizes that the difficult decisions lie ahead. NASA is developing an integrated, long-term Agency plan that ensures a national capability to
support NASA’s mission. We will accomplish this by: 1) identifying NASA’s critical capabilities and, through the use of external reviews, determining which capabilities must
be retained by NASA and which can be discontinued or led outside the Agency; 2) expanding collaboration with industry, universities and other agencies and outsourcing
appropriate activities to fully leverage outside expertise; and 3) pursuing civil service reforms for capabilities that NASA must retain, to ensure recruitment and retention of
top science, engineering and management talent at NASA. NASA will also address the Agency backlog of facilities revitalization and deferred maintenance by repairing
necessary and affordable facilities and by carefully phasing down the remainder. All of these tough decisions on the relevance of programs and facilities will require realistic,
responsible decisions on priorities and financial supportability.

It is noteworthy that the President’s budget reflects a NASA investment in science and technology that is 42% of the total Agency budget, up from 31% in FY 1991, and
targeted to reach 51% by FY 2006. Funding for NASA science and technology is an investment in the future and an important factor that helps fuel the U.S. economy and
maintain U.S. leadership and competitiveness in the global economy. The science priorities that support the objectives behind the near- and long-term missions being pursued
by our 5 Enterprises are fully consistent with NASA’s Strategic Plan. Those priorities are identified by working with the National Research Council (NRC) and the NASA
Advisory Committees, which make recommendations to NASA in critical areas of science research and technology development. These recommendations represent the
highest priorities of the science community. NASA continues to coordinate its science programs with other Federal agencies through multiple mechanisms, both formal and
informal.

The FY 2002 budget takes actions to address cost growth in the Space Station. To ensure that the Station program remains within the 5-year budget plan, the President’s FY
2002 budget redirects funding for certain elements of the program while preserving the highest priority goals of a permanent human presence in space, world-class research in
space, and accommodation of international partner elements. The U.S. core will be complete once the Space Station is ready to accept major international hardware
elements. The cost growth is offset in part by redirecting funding from remaining U.S. elements, particularly high-risk elements including the Habitation Module, Crew Return
Vehicle and Propulsion Module, avoiding more than $2 billion in costs. In addition, funding for U.S. research equipment and associated support will be realigned with the
on-orbit capabilities of the Space Station.

The President’s FY 2002 budget takes action to ensure that the Space Station program will be within the $25 billion statutory cost cap when U.S. Core Complete is achieved in
FY 2004. How the cap language should apply to elements that are considered enhancements is an issue that we must work with the Congress. The President’s budget also
proposes a total authorization for the Space Station over a 5-year period as a further means to cap Station spending; this amount may be adjusted upward if efficiencies and
offsets are found in other Human Space Flight programs and institutions. NASA has initiated management reforms for the ISS program, including transferring program
reporting from the Johnson Space Center to NASA Headquarters until a management plan has been developed.

The scope of the 104 Space Shuttle missions flown to date has demonstrated that the Shuttle is the most versatile launch vehicle ever built. This budget includes funding for
safety investments including additional safety upgrades and infrastructure needs that will improve reliability and ensure continued safe operations of the system.  The Space
Flight Operations Contract performed by Shuttle prime contractor continues to comprise almost one-half of the Space Shuttle budget and will increase in size as more
contracts are consolidated.

The FY2002 budget includes a significant increase in funding for the Space Launch Initiative. The Space Launch Initiative is a focused investment of $4.9 billion dollars
between FY2001 and FY2006 for risk reduction and technology development efforts for at least two competing architectures with dramatically lower costs and improved
reliability and safety. Through this initiative, NASA will reduce technical and programmatic risks to acceptable levels to enable a competition for full scale development of one
or more 2nd Generation Reusable Launch Vehicles around the middle of this decade.

This budget also includes funding to begin to develop the technologies needed to realize our vision for a 21st century aerospace vehicle. This vision is one in which aerospace
vehicles can smoothly change shape, or morph, in flight like birds to optimize performance during complex maneuvers in complete safety, and be capable of self-repair when
damaged. These vehicles will employ intelligent systems made of smart sensors, micro processors, and adaptive control systems to enable the vehicles to monitor their own
performance, their environment, and their human operators in order to avoid crashes, mishaps, and incidents. They will also serve as the means for sensing any damage or
impending failure long before it becomes a problem. The research into the technology to make this vision a reality-nanotechnology, biotechnology and information
technology-will result in leapfrog capabilities compared to today’s state-of-the-art vehicles.
Also included in the Aerospace Technology FY 2002 budget is funding to establish five university-based Research, Education, and Training Institutes (RETIs). This effort will
strengthen NASA’s ties to the academic community through long-term sustained investment in areas of innovative, new technology critical to NASA’s future and to broaden
the capabilities of the nation’s universities to meet the goals and objectives of NASA’s future science missions and technology programs. These RETI’s will be openly
competed at regular intervals and will inched a mandatory sunset date.

The FY 2002 budget integrates NASA’s investments in bio-nanotechnology computing and electronics which can provide capabilities orders of magnitude better than the best
of today’s electronics. Developed as detectors and sensors, they could enable spacecraft systems to be much smaller, with higher performance and lower power-consumption
than possible with today’s technology. Biologically inspired materials will have multi-functional capability and overall performance far greater than current materials.   Key
capabilities of these systems will be the ability to adapt to changing conditions and Agency mission needs and to detect damage or degradation before it becomes serious and
reconfigure or repair themselves.

This budget funds the newly restructured Mars Exploration Program (MEP) and sets in place basic technology investments for the next decade of robotic Mars exploration. The MEP strategy is linked to NASA’s experience in exploring Earth, and uses Mars as a natural laboratory for understanding life and climate on Earth-like planets. The 2001
Mars Odyssey orbiter was launched on April 7, and two Mars Exploration Rovers are being prepared for launch in 2003. Following that, NASA is planning for a Mars
Reconnaissance Orbiter mission in 2005, and a competitively selected Mars Scout mission. In addition, science definition and technology development for a next-generation,
mobile surface laboratory in 2007 is underway that will pave the way for a potential sample return mission early in the next decade. Also funded in the Space Science budget is
the Living With a Star program, which address aspects of the Sun-Earth system that affect life and society. Its program elements include a space-weather research network; a
theory, modeling and data analysis program; and space environment test-beds. The FY 2002 budget includes funding to support the launch of 9 space science missions by the
end of FY 2002.

In NASA’s Earth Science Enterprise, the FY 2002 budget enables both the present and the future of scientific discovery leading to improved climate, weather and natural
hazard prediction. In the present, it funds the continued deployment of the Earth Observing System (EOS) and related research to achieve the world’s first integrated, detailed
look at the interactions of land, atmosphere, oceans, ice and life. It is these interactions that drive variability and change in the Earth system, including regional weather, El
Nino, large-scale floods, and volcanic activity. For the future, this budget initiates the next generation of observing satellites beyond EOS, as well as funds the advanced
technology development that will make those missions less expensive and more capable. It also funds a program of applications research that will demonstrate the practical
use of Earth science data.

Also included in the FY 2002 budget is an increase of $10 million to provide a significant number of scholarships in science and engineering to enhance our student and faculty
programs, including the development of a scholarship program in disciplines critical to NASA’s future workforce needs. NASA will be seeking legislative authority to make
these investments in our future scientists and engineers through a scholarship for service program. We will link these scholarship students to our current summer student and
faculty programs, so that the students can work at our field Centers, side-by-side with our scientists and engineers.

The President has challenged NASA to ensure that we fully tap the R&D capabilities of academia and industry so our workforce and institutions are most effectively focused
and to ensure a national capability to support NASA’s mission. We face some difficult decisions and will take a close look at program priorities, capabilities outside NASA and
the capabilities at our NASA field installations. We will continue to review the need for certain NASA facilities where the continuing cost of maintaining an aging
infrastructure should yield to other priorities more closely tied to advancing technology.

Beginning with this FY 2002 budget request, and consistent with statutory direction provided in the FY 2001 VA-HUD-Independent Agencies Appropriations Act (P.L.
106-377), NASA is implementing a two-appropriation budget (excluding the Inspector General account) — Human Space Flight (HSF) and Science, Aeronautics and
Technology (SAT). This is NASA’s first step in transitioning to a full-cost budget. While full cost will ultimately integrate institutional and programmatic funds into a single
budget, that integration is done in a step-wise manner, by providing for an Institutional Support budget line under each Enterprise and eliminating the present Mission Support
appropriation. This initial step will begin to recognize, budget, and track direct full time equivalent (FTE) employees associated at the Enterprise level and then use this FTE
data to distribute institutional costs (Research and Program Management and non-programmatic Construction of Facilities) using the relative percentages of direct FTE’s by
Enterprise. Taking this step will help managers and decision makers begin to understand the potential magnitude of institutional funds that are associated with each Enterprise
in preparation for the day when full cost budgeting will distribute these funds to the project level via the appropriate cost/service pools.

NASA is an Agency about the future, and it is critical that we, as a Nation, invest in the future of science and engineering–as represented by the President’s FY 2002 budget
request–if we are to continue to press the boundaries of the future.

The following information provides detail, with funding delineated under the new budget structure presented in the FY 2002 budget request, concerning plans for NASA’s
Strategic Enterprises and major program areas. Appended to this statement are several charts depicting the funding proposals reflected in the President’s FY 2002 budget
request.

Human Exploration and Development of Space (HEDS) Enterprise

International Space Station:

ISS is funded at $2.087.4 billion. This budget represents continued support for the ISS program, enabling the high priority goals of permanent human presence in space,
world-class research in space, and accommodation of international partner elements.  In response to the recent estimated ISS budget cost growth projections of $4 billion
between FY 2002-2006, NASA is undertaking reforms to curtail cost growth and identify savings. Because the cost to operate and utilize existing ISS elements and to continue
the integration and launch of the 3-year inventory of hardware already at KSC is essentially committed, NASA’s strategy is to redirect funding from projects with significant
development activity remaining. Redirecting funding for the Propulsion Module, the Habitation Module and the Crew Return Vehicle avoids over $2 billion in costs. Restoration of these projects will be contingent on the quality of NASA’s future cost estimates, the resolution of technical issues, the success of management reforms and
other cost-control actions underway, and the ability to fund enhancements within the 5-year runout for Human Space Flight. Funding for U.S. research equipment and
associated support will be realigned in accordance with the resulting on-orbit capabilities, but will maintain support for research considered most promising and crucial. While
providing a clear call to NASA for fiscal restraint, this budget nonetheless maintains a commitment to launch the hardware that NASA has already built and maintains the
current assembly schedule until at least 2004.

In addition to the redirected funds, NASA is preparing an action plan for management reform, and several management initiatives at NASA’s space flight Centers to reduce
costs by improving our cost-estimating ability, improving management efficiencies, refocusing civil servants, developing a plan for competition, and seeking greater
participation from international partners.

With regard to Space Station research, we are fully committed to deliver to orbit all of the research equipment planned for the next 2 years. It goes without saying, there are
many in the research communities who have very legitimate concerns about the impacts of the research funding reductions and crew resource limitations necessary to address
cost growth. We are developing a post-2004 research utilization strategy that will be reviewed by our research community.

This budget continues our commitment to ISS commercialization. We will continue to seek commercial investment in infrastructure and ISS operations that may reduce
Government costs, and we are continuing to assess Non-Government Organization (NGO) concepts for ISS utilization.

Space Shuttle:

The President’s FY 2002 budget includes $3.284 billion for the Space Shuttle Program. Earlier this month, the Space Shuttle celebrated the 20th Anniversary of the launch of
STS-1. Over the past two decades, the Space Shuttle has proven itself to be the safest and most versatile launch vehicle ever built. During the past year, the Space Shuttle has
continued to perform the critical function of providing access to support the assembly and resupply of the ISS. The Space Shuttle also provides a space-based laboratory for
conducting human supported Earth science missions, and will continue to maintain the Hubble Space Telescope and fly biological and physical research missions.

To sustain safety and support the Shuttle manifest, the Space Shuttle program will continue to invest in the Space Shuttle system to lessen the impacts of obsolescence and
maintainability issues and to achieve lower operating risk by making safety investments, including upgrading the system. The Space Shuttle will need to be capable of
supporting the critical human space transportation requirements for Space Station assembly and operations through at least this decade. NASA has determined that investing
in upgrades provides not only a safer vehicle, but also one that is more reliable and one that is easier to maintain. NASA is continuing to assess the Space Shuttle programs
aging infrastructure to determine how these needs-particularly safety-related needs–can be addressed within the Agency’s budget priorities. For FY 2001, 7 scheduled
missions will support the assembly and resupply of the ISS. In FY 2002, NASA is planning to launch 7 missions–5 ISS assembly and resupply flights, the Hubble Space
Telescope’s 3A servicing mission, and a research utilization flight (STS-107).

NASA plans to aggressively pursue Space Shuttle privatization opportunities that improve the Shuttle’s safety and operational efficiency. This reform will include continued
implementation of planned and new privatization efforts through the Space Shuttle prime contractor and further efforts to safely and effectively transfer civil service
positions and responsibilities to the Space Shuttle prime contractor.

Space Access:

Recent market stagnation threatens the viability of new commercially developed launch systems. NASA continues to work with this industry segment to seek ways to enable
an opportunity for them to compete with the major launch companies, to ensure reliable cost effective U.S. launch services to meet Agency requirements.

Space Operations

On-orbit checkout of the TDRS-H spacecraft was conducted in July-September 2000, at which time the Multiple Access Return (MAR) service exhibited out of specification
problems. An investigation of the MAR anomaly began in September 2000. The root cause of the anomaly has been determined and changes to the TDRS-I and –J spacecraft
flight hardware will be implemented prior to their launch. NASA is evaluating its contract options relative to accepting or rejecting the TDRS-H spacecraft. Additionally, in
attaining the separate goals of responsive services at the lowest possible cost and of transitioning to commercial service providers, the Space Operations and Maintenance
Organization (SOMO) faces several challenges, namely, evolving to a fee-for-service approach to operations, and meeting an aggressive cost reduction target while assuring
mission safety.

Advanced Programs:

In order to better align with current Agency budget priorities, in FY 2002 the Human Exploration and Development of Space (HEDS) Technology Commercialization
Initiative (HTCI) is focused largely on nearer-term goals within the overall strategic framework that has been defined for HEDS. The HTCI is considering commercialization
in a broader context than the more focused efforts to date involving commercialization of the ISS or the Space Shuttle. Through HTCI, NASA intends to examine
architectures that take advantage of a potentially robust future commercial infrastructures that could dramatically lower the cost of future space activities.

Space Science Enterprise

NASA’s Space Science Enterprise (SSE) is focused on exploring the near and far reaches of our Universe – the planets, stars, galaxies and other phenomena – in an attempt to
answer these fundamental questions: How did the Universe begin and evolve? How did we get here? Are we alone?

Through its various research programs and diverse missions, the Space Science Enterprise has already made great strides to begin to answer these questions. The scientific
discoveries and insights gained through the Space Science Enterprise programs and missions have literally changed the way we view the Universe and our place in it. NASA’s
Space Science FY 2002 budget request is $2.786 billion.

Space Science had many important successes over the past year, several of which were related to our closest neighboring planet, Mars. On April 7, NASA began a return to
Mars with the successful launch of the Mars Odyssey spacecraft, which will arrive at Mars in October 2001. Once there, the spacecraft will use its suite of scientific
instruments to map the chemical elements and minerals that make up the Martian surface, look for signs of water, and analyze the Martian radiation environment. The Mars
Global Surveyor is continuing its in-depth imaging mission and has revealed features suggesting the possibility of current sources of liquid water at or near the Martian surface. Surveyor has also imaged layers of sedimentary rock, which suggest that long ago Mars may have had numerous lakes and shallow seas. Since most scientists consider water to
be one of the key ingredients for life, these findings are particularly compelling. NASA is anxious to continue exploring the Red Planet, and the new Mars Exploration
Program unveiled last October will ensure that we do exactly that. Through a series of orbiters, landers, rovers, and sample return missions that will take us through the next
decade and beyond, NASA is committed to unraveling the secrets of Mars’ past environment and geology and to discovering the role that water played. Once we begin
understanding some of these parameters, we will be better able to determine whether life ever arose, or is still present, on Mars.

Further out in the solar system, NASA landed a spacecraft on an asteroid for the first time. Though never intended to be a lander, the Near Earth Asteroid Rendezvous
(NEAR) spacecraft touched down on asteroid 433 Eros in February 2001. NEAR completed a very successful prime mission of orbiting Eros at different altitudes and sending
back dramatic images of the asteroid’s surface. With “nothing to lose,” project scientists decided to attempt a “controlled crash” onto the surface in hopes of getting close-up
images during the descent phase. Not only did we obtain spectacular images, but also NEAR actually continued to send signals after it landed. The spacecraft returned readings
from its magnetometer and gamma-ray spectrometer from the surface of Eros before it was shut off at the end of February.

NASA has long supported the scientific study of the phenomena and fundamental physical processes involved in solar-terrestrial physics and has launched numerous spacecraft
to study the dynamics of our Sun. A suite of NASA spacecraft continues to study the Sun now, in the maximum phase of its 11-year solar cycle. The volatility of the Sun
during this phase was at one time only of concern to solar physicists; however, with humankind’s increasing dependence on satellite systems, energy grids, and air travel,
learning more about the Sun and its effects on the Earth has become an important area for scientific research. Just recently Solar and Heliospheric Observatory (SOHO)
scientists were able to image a solar storm on the far side of the Sun (not facing Earth) for the first time. This allowed them to provide a week’s advance warning about the
bad weather in space, which enabled commercial and government entities to take measures against system damage.

After more than a decade in space, the Hubble Space Telescope (HST) is still delivering cutting-edge science and amazing images. A HST census found that the mass of a
supermassive black hole is directly related to the size of the galaxy’s nuclear bulge of stars. This suggests that the evolution of galaxies and their host black holes is intimately
linked.

Using the Chandra X-Ray Observatory’s superior resolution, astronomers have also discovered a new type of black hole in the galaxy M82. This black hole may represent the
missing link between smaller stellar black holes and the supermassive variety found at the centers of most galaxies. Just recently, scientists captured the deepest exposure yet
made by any telescope using Chandra. This image, comparable to the famous Hubble Deep Field, found black holes dominating the Universe at the faintest and farthest
distances. The fact that black holes were such a dominant feature of the early Universe came, as somewhat of a surprise, since they are not nearly as common today.

NASA’s Space Science Enterprise has made major contributions to the scientific world over the years. By making hard decisions to cancel lower-priority missions with
significant cost growth or schedule slippage, including the Pluto-Kuiper Express and Solar Probe missions, the President’s FY 2002 budget request paves the way for more
capable missions and increasing scientific discoveries and revelations in the years ahead. In addition to a robust Mars Exploration Program for the next decade, the proposed
budget also focuses on new technology development in space propulsion systems that could support faster, more capable planetary missions such as a potential Pluto “sprint”
mission and supports critical technology investments for future decisions on high-energy astrophysics missions.

Space Science continues to develop integrated programs of missions that have delivered and will deliver a hearty and diverse abundance of new scientific understanding about
the universe and our place within it to the American people.

Earth Science Enterprise

The President’s budget for FY2002 is $1.515 billion. It reflects the net change in funding for Earth Observing Systems (EOS) as peak funding for the first series of EOS
declines and funding for formulation of next decade missions ramps up. NASA’s Earth Science Enterprise is our Nation’s investment in improving climate, weather and natural
hazard prediction using the vantagepoint of space. Our ability to view the Earth from space is what enables today’s weather forecasts, and what will help enable tomorrow’s
capability to predict El Nino, decadal climate change, and even volcanic eruptions. Earth science is cutting edge science, exploring changes taking place on our home planet
that are little understood today. And Earth science is also science in the national interest, providing new tools for decision-making by businesses, state & local governments,
and other Federal agencies.

FY2000 was the best year yet for NASA’s Earth Science program, as measured by our contribution to the list top science discoveries worldwide, published by Science News. We
mapped the pattern of thinning and thickening of the Greenland ice sheet, published a 20 year record of North and South polar sea ice extent, and observed a Connecticut-size
iceberg break off from the Antarctic ice sheet. We demonstrated the capability for 2-day prediction of storm formation, and showed that air pollutants inhibit rainfall. We
discovered that the mysterious ‘Chandler wobble’ of the Earth on its axis is caused by changes in deep ocean circulation, and created a consistent global land cover data set for
use as a baseline for measurement of future changes.

Much of this work was made possible by NASA-sponsored scientific research and the first elements of the EOS series of satellites now being deployed. Landsat 7, QuikSCAT,
Terra, and ACRIMsat were all successfully launched in 1999, and are delivering science data to millions of users today. In February 2000, we flew the Shuttle Radar
Topography Mission, and are using the data to produce the most accurate digital elevation model of the Earth’s land surface between 60°N and 56°S. This will be of great use
not only to scientists but also to civil engineers who are working to improve aviation safety in mountainous areas and to manage potential flood hazards. Late in 2000, we
successfully launched the New Millennium Program Earth Observer-1 to test several new remote sensing instruments. One instrument is demonstrating the capability to make
Landsat-type measurements at one-fifth the size and one-fourth the cost. Another instrument is demonstrating the first hyperspectral imager flown in space, paving the way
for the next big advance in commercial remote sensing.

Over the next 3 years, we will complete the deployment of the EOS System. Later this year, we will launch the Aqua spacecraft to make the most accurate measurements yet
of atmospheric temperature and humidity–the kind of data that will enable scientific discoveries leading to weather prediction to be extended from 3 to 5 days out to 7 days. ICEsat will make the first detailed topographic maps of the world’s great ice sheets. Other missions will extend key data records of ocean topography and solar irradiance that
are essential to seasonal and decadal climate prediction. Smaller, complementary missions will study Earth system phenomena never before studied globally from space, such as
the Gravity Recovery and Climate Experiment (GRACE) which will provide a precise map of the Earth’s mass distribution and changes in the Earth’s gravity field, including
changes in large underground fresh water reserves (aquifers). The development of the EOS Data and Information System (EOSDIS) is nearly complete, and is already doing the
job of operating EOS satellites now in orbit and processing their data. In FY 2000, EOSDIS provided over 8 million data products in response to 1.5 million requests. We have
already begun to plan how data and information system services should evolve to meet the needs of Earth science and applications over the next decade.

Planning for the next decade of Earth science has been in full swing over the past year. NASA’s Earth Science Enterprise has a new Research Strategy for 2000-2010 that has
been positively reviewed by the National Research Council and endorsed by the NASA Advisory Council committee advising the Office of Earth Science.

Five EOS successor missions are planned as part of the FY 2002 budget. A Global Precipitation Mission will build on the success of TRMM, and provide the first global
observations of rainfall. This will provide data essential to future assessments of fresh water availability, and to answering some of the highest priority questions in the
Research Strategy. Ocean topography and ocean surface winds missions will succeed the EOS-era Jason and SeaWinds, respectively, providing continuity of measurements that
are proving essential to forecasting and monitoring El Nino and hurricanes. Atmospheric ozone/aerosol and solar irradiance missions will extend EOS-era measurements of
two key factors (atmospheric chemistry and incoming solar energy) that help distinguish natural from human influences on climate change.

In addition, this budget provides essential funding for future Earth exploratory missions to probe least understood Earth system processes, which will be awarded competitively. 

This budget request also adequately funds research to use these observations to begin to answer the questions in the Research Strategy, to demonstrate practical applications of
these data to society described in the Applications Strategy, and to develop advanced technology to make such observations better and cheaper in the future, as described in
the Technology Strategy. It is this investment in Earth science from space that will enable the future of climate, weather, and natural hazard forecasting to serve national
needs and maintain US global leadership in space-based Earth observations in the decades

Biological and Physical Research Enterprise

NASA’s Office of Biological and Physical Research (OBPR) Enterprise was established this past year to affirm NASA’s commitment to the essential role biology will play in
the 21st century and establish the core of biological and physical sciences research needed to support Agency strategic objectives. OBPR was established under the premise that
revolutionary solutions to science and technology problems are likely to emerge from scientists, clinicians, and engineers who are working at the frontiers of their respective
disciplines and are also engaged in dynamic interdisciplinary interactions.

Funded at $360.9 million in FY 2002, OBPR uses the space environment as a laboratory to test the fundamental principles of physics, chemistry and biology; conducts
research to enable the safe and productive human habitation of space; and enables commercial research in space. OBPR includes programs in Physical Sciences Research,
Fundamental Space Biology research, and Biomedical and Human Support research. OBPR conducts research activities in conjunction with four other major Federal agencies
through approximately 30 partner agreements.  OBPR also manages 12 Commercial Space Centers across the country.

OBPR is preparing for the transition to a new era in human space flight. The International Space Station (ISS) will provide a growing capability as a research platform. OBPR
will work to extract the maximum scientific and commercial return from this premier research facility while conducting research to ensure the health and safety of space
travelers in the near term and into the future.

NASA is on track to deliver the first 10 research equipment racks to ISS as planned. In addition, we have already selected more than 100 specific experiments planned for the
first 6 ISS increments. During Expedition 1, from October 2000 through February 2001, the crew conducted several research activities in the areas of educational seed growth
experiments, crystal growth of biological macromolecules, motion and vibration technology and human research. Eighteen NASA experiments are scheduled to become
operational during Expedition 2 (March through July of 2001), including important biomedical experiments in the areas of radiation dosimetry, psychosocial factors, sleep
physiology, drug absorption, and sensorimotor coordination. Those experiments will continue into Expedition 3 (July through October of 2001), and additional OBPR
experiments will be added to study renal stone prevention, spatial orientation, and pulmonary function. Consistent with the current baseline assembly sequence, the permanent
Space Station crew size will be limited to three crew due to cost growth. Crew size will be a major limiting factor for research activities and reduced funding support for
completing state-of-the-art research facilities will have an impact on the planned research program.

NASA is restructuring the ISS research budget to align it with the on-orbit capabilities and fiscal resources available. This restructuring activity is taking place over the next
few months. OBPR is prioritizing and time-phasing research plans for internal lab-based research as well as external truss and exposed platform Fundamental Physics, Earth
and Space Sciences research. OBPR is engaging the scientific community as part of this process. We have proposed a framework of priorities to ensure a world-class research
program, consistent with NASA’s commitment to safety, to serve as the basis of discussion with the scientific community.

During Space Station construction, OBPR is aggressively pursuing opportunities to maximize research within the availability of the Space Shuttle missions, through the use of
mid-deck lockers on planned ISS assembly flights, and ISS utilization flights.

Aerospace Technology

The budget request for the Office of Aerospace Technology Enterprise is $2,375.7 million. We are funding the highest priority aeronautical and space technologies while
maintaining an active base research program that will enable revolutionary advances in the way we design and operate the aerospace vehicles of the 21st Century. We have
terminated projects that have either delivered on most of their promised technology or do not offer a leap in technology commensurate with their funding. Included in those
terminated are Intelligent Synthesis Environment (ISE), High Performance Computing and Communication (HPCC), Rotorcraft and other aircraft activities focused on
near-term military applications. We are placing additional emphasis, and dollars, on 21st Century Aerospace Vehicles, Computing, Information & Communication Technology
(CICT), Virtual Airspace Modeling and nanotechnology. These increased investments reflect where we need to focus our efforts to expand knowledge and to advance the state
of the art in revolutionary new aircraft and air traffic management technology.

Aerospace Technology Programs

To reflect our new emphasis on innovation, as well as reflect the technical progress gained in recent years, we have reformulated our Enterprise goals-Revolutionize
Aviation, Advance Space Transportation, Pioneer Technology Innovation, and Commercialize Technology.

Goal One, Revolutionize Aviation.  Without a revolution in the aviation system, it will be impossible to accommodate the projected tripling of air travel within two decades in
a safe and environmentally friendly manner. Revolutionizing the aviation system to meet the demands for growth means we must provide a distributed flexible and adaptable
network of airways-within the physical and environmental constraints of today’s system. We must and will address the civil aviation system’s fundamental, systemic issues to
ensure its continued growth and development, thereby giving backbone to the global transportation system and assuring global economic and cultural success and vitality.

We have restructured our Base Research and Technology investments to focus on revolutionary 21st Century Vehicle technologies. The design and fabrication of 21st Century
aerospace vehicles will not be accomplished by the traditional methods of multiple mechanically connected parts and systems. It will employ fully integrated embedded
“smart” materials that will endow the vehicle with unprecedented levels of aerodynamic efficiency and control. Proposed 21st Century Aerospace Vehicles will be able to
monitor their own performance, environment, and even their operators in order to improve safety and fuel efficiency, and minimize airframe noise.

Goal Two, Advance Space Transportation. I am very excited about the Agency’s vision to revolutionize the Nation’s space transportation systems. I believe this is the most
important initiative of this Enterprise and one of the most important to our Nation. NASA’s vision for space transportation is being pursued through a phased approach
embodied within the Integrated Space Transportation Plan and the Space Launch Initiative. We recognize that privately owned and operated launch vehicles lofting NASA
payloads on a regular basis is the right strategy to free up the agency’s resources for scientific pursuit on the new frontier.
Last month we reached a major milestone in the 2nd Generation Reusable Launch Vehicle program when we selected a number of companies to enter into negotiations to
participate in the Space Launch Initiative. Following an exhaustive series of evaluations, we concluded that the X-33 and X-34 projects would not receive Space Launch
Initiative funds. This difficult decision was based upon the determination that the benefits to be derived from continuing these programs did not justify the cost. We plan to
announce the results of the ongoing Space Launch initiative negotiations in May.

Goal Three, Pioneer Technology Innovation. We aim to revolutionize the developmental processes, tools, and capabilities of the aerospace industry. To create the aerospace
transportation systems of the future, we need to develop a new approach to engineering that puts safety, reliability and mission assurance first. Collaborative tools and
human-like intuitive environments are critical to allowing us to ‘virtually’ build and test vehicles and systems before we spend money on expensive hardware. System
characteristics such as intelligence, rapid self-repair, and adaptability will come about through innovation and integration of leading-edge technologies, such as biotechnology,
nanotechnology, and intelligent systems. The unique goal to Pioneer Technology Innovation focuses on both the specific technology innovations and the processes, which
drive them.

To strengthen our ties with the academic community we are implementing five University-based Research, Education and Training Institutes (RETIs). The role of the RETIs
will be to research and utilize innovative, cutting-edge opportunities for science and technology that can have a revolutionary impact on NASA’s future missions. These
RETI’s will be openly competed at regular intervals and will include a mandatory sunset date.

We have combined existing programs with new activities to create the Computing, Information & Communications Technology (CICT) research program to concentrate our
core expertise in critical technologies

Goal Four, Commercialize Technology.

Since its inception in 1958, NASA has been charged with ensuring that the technology it develops is transferred to the U.S. industrial community, thereby improving the
Nation’s competitive position in the world market. The FY 2002 budget request of $146.9M continues this important aspect of our mission. The Agency’s
commercialization effort encompasses all technologies created at NASA centers by civil servants, as well as innovations produced by NASA contractors. About 75% of the
amount requested for NASA’s Commercial Technology Program effort is for NASA’s Small Business Innovation Research (SBIR) Program. The NASA SBIR program has
clearly contributed to the U.S. economy, fostering the establishment and growth of over 1,100 small, high technology businesses.

In addition to NASA’s Commercial Technology Program, we are also working to transfer commercial technology across the entire aerospace program. For example, the need
for data dissemination within a high-integrity wireless broadband network has been identified as one of the major technical barriers to providing an order of magnitude increase
in aviation system capacity and safety. NASA’s work in wireless broadband networking illustrates a huge commercial success. We have demonstrated real-time data link
technology to move and distribute unique and distinct flight data to multiple sites in real-time while addressing multi-level priorities in a secure, high integrity data sharing
environment serving safety and capacity needs of the National Airspace System. This broadband technology demonstrated a phased array antenna technology that achieves
data rates 100x greater than what is operational in today’s National Airspace System, greatly increasing the capacity of the NAS, reducing aviation system delays and saving
billions of dollars in air travel operations cost. In April 2000, Boeing unveiled a high-speed global communications service offering live in-flight Internet, e-mail, and TV to be
available next year. While anticipated revenues have not been announced, analysts project the addressable market to be about $70 billion over the next 10 years.

Other Key Initiatives

Institutional Support

NASA has conducted a review of its facilities infrastructure, finding that the deteriorating plant condition warrants an increased revitalization rate to avoid safety hazards to
personnel, facilities, equipment and mission. Some facilities have deteriorated to the point that they need to be replaced. The President’s FY 2002 budget request includes
facilities funding to address some of these needs, but the backlog of revitalization requirements continues to grow and will be addressed as part of NASA’s Critical Capabilities
Review.

NASA plans to address the considerable Agency backlog of facilities revitalization and deferred maintenance, by repairing those facilities necessary to take us into the future
and that are affordable to keep, and by carefully phasing down the remainder. This requires tough decisions on the relevance of each facility as well as realistic, responsible
determinations on the financial supportability of them. These decisions will be made as part of the Strategic Resources Planning activity that NASA will undertake as part of
its Critical Capabilities Review over the next several months. This effort will fully integrate facilities planning with program planning, consistent with NASA’s Strategic Plan
and Center implementation plans. In fact, this Strategic Resources Planning effort will become an integral and ongoing part of NASA’s facilities planning and management
processes.

Performance Plans

NASA is fully committed to the Government Performance Results Act (GPRA). Each year, we believe we make further progress in portraying our goals and commitments
towards performance in terms that are relevant to the American people. We appreciate the heightened level of accountability GPRA affords. The NASA Performance Plan
has been significantly improved for FY2002 in several key areas: