The Big Change: NASA Hits the Ground Running - Part 1

Updated with new charts 13 November 2002

The Bush Administration will unveil a change in NASA's current budget this week. With changes that affect both immediate - and long range plans - this will mark the beginning of one of the most significant shifts in NASA policy in the past decade.

Starting with a request to modify its previously submitted FY 2003 NASA budget (and to stay within the original overall budget request in so doing), the Administration will seek to substantially restructure the existing Space Launch Initiative (SLI); dedicate more resources to the International Space Station (ISS) program; and focus more resources upon extending the life and enhancing the safety and reliability of the Space Shuttle.

These changes come on the heels of a flurry of advisory committee reports and independent cost analyses - some of which were initiated by NASA Administrator Sean O'Keefe - others already underway when he became Administrator.

The Administration could have followed the standard process and unveiled these plans when it rolls out its FY 2004 budget. Instead, it has chosen a much more aggressive approach - one wherein they literally hit the ground running.

While this approach, as crafted, will certainly give NASA an opportunity to start almost immediately, it will also be somewhat jarring to those whose programs and projects are affected. But, as they say, change is always unsettling - yet out of chaos comes opportunity.

How the change will start

Before NASA starts to change things around, the President has to ask for a change - and Congress has to agree. The changes to NASA's budget will take the form of a budget amendment submitted by the Bush Administration to Congress on 12 November 2002. The amendment, if signed into law, would restructure many NASA programs and would shift funds around within the FY 2003 NASA budget. No additional funds will be requested for FY 2003.

This process all began with detailed budget and programmatic Information forwarded back and forth between NASA and the Office of Management and Budget (OMB) over the past few weeks. OMB then made its recommendations to the President's office. This then lead to a formal budget amendment to be signed by the President. This amendment will then be transmitted to both Houses of Congress this week.

While not unheard of, this is not the normal way of doing things.

Both the House and Senate Appropriations committees have already reported out their versions of the FY 2003 VA HUD and Independent Agencies Appropriations bills for FY 2003. Eventually, the two bills will be taken up by a House-Senate conference committee to resolve differences. Once differences have been ironed out , identical versions of a compromise bill would go back to each body for a vote. Assuming passage, the bill will then be sent to the President for signature and enactment into law.

There is a bit of a twist this year. Although the lame duck Congress (which meets after the election) often falls short of accomplishing all of the business before it, it is hoped that they will vote on these bills and pass them on to the President for signature. If they do not manage to accomplish this before the end of the current Congressional session, the bills will need to be reintroduced into the new Congress next year. It is almost certain that the requested alterations by the Bush Administration would be present in those new bills.

The chances for success are buoyed by the recent election results which will give the Republican party control of both House and Senate. However, this process may be delayed a bit if Congress continues to fund the government (at previous Fiscal Year levels) using a Continuing Resolution. Whatever the road taken, or schedule followed, when NASA's FY 2003 bill does arrive at the President's desk, these new changes in NASA and its FY 2003 budget will be almost certainly be enacted into law.

That's when things start to get busy.

What will change

[click to enlarge] NASA seeks to implement a new Integrated Space Transportation Plan (ISTP). The current ISTP was originally created as the policy underpinning of SLI. The SLI, in turn, was NASA's attempt to refocus its attempts to develop advanced launch technologies after the failure of the X-33 program.

The modified ISTP will now contain three major thrusts: the Space Shuttle, the Orbital Space Plane (OSP), and Next Generation Launch Technology (NGLT). SLI will remain in existence, but its focus will be tightened. The restructured SLI will contain the OSP and NGLT programs. Meanwhile, half of the funds originally targeted for SLI will be spent outside the confines of this program.

Key features under the new ISTP include developing an OSP to carry humans to and from orbit (and serving as a crew return vehicle), shifting the current decision date for Reusable Launch Vehicle (RLV) development from 2006 to no earlier than 2009, and continuing to fly the Space Shuttle will until at least the middle of the next decade via enhancements to the Shuttle vehicles and the program's infrastructure.

How things will change

In implementing this plan NASA seeks to follow several paths simultaneously so as to limit technological risks. The existing Space Shuttle system will continue to operate providing an overall backfall should any new systems encounter problems along the way. NASA's requirements will be viewed as the prime drivers. NASA will consider, but not depend on DoD or commercial needs (which never stand still) to justify how it proceeds.

In the X-33 program, and, to a lesser extent, in the current SLI program, NASA placed a heavy emphasis on commercial involvement and launch demand in sizing its vehicles and projecting cost amortization. NASA also sought to instill interest (never clearly specified) from DoD in the systems it was developing. DoD's interest did not materialize into a significant form of collaboration, and the launch market changed courses several times and then deflated during the X-33 and SLI years. As such, these activities were scoped to a set of drivers and requirements that significantly changed. Yet the programs did not adjust to these changes. NASA now believes that development of an RLV can not be supported by commercial market demands.

The following is from a draft version of NASA's proposed amendment and describes how the conditions and assumptions upon which NASA based its space transportation strategy decisions have changed.

Conditions/assumptions SSTO Approach FY 1994 SLI/ISTP FY 1999 Revised ISTP FY 2003
SSTO Technology Achievable Too risky, go TSTO Too risky, go TSTO
Near-term Launch Market Robust growth Stable, little growth Declining
RLV development cost ~$4-6 Billion ~$10 Billion >$20 billion
Gov't Share of Dev't Cost Little Most All
Market Driver Commercially Driven Commercial Convergence Space Station
Next Generation
RLV Strategy
Stove-piped approach
to next-generation system
Integrated with other
NASA space transportation
Tight coupling between
science needs of Station
and all space
transportation

[click to enlarge] NASA will implement transitions within a restructured SLI program swiftly in FY 2003 so as to avoid spending limited resources on projects which are now of lesser priority under NASA's revamped ISTP. NASA intends to be rather aggressive in this regard. The new ISTP will be managed at NASA Headquarters - not at a field center. Existing SLI contractors will find themselves refocused on implementing these new priorities. Ongoing contracts will be continued, but some may find themselves discontinued once renewal options come up.

Large changes such as those being pursued by NASA do not come without some impact upon personnel. This will lead to some workforce changes that have yet to be spelled out - but will find mention in the FY 2004 budget request which will be sent to Congress in February 2003. No mention of RIFs, layoffs, or reassignments is made in the current amendment being forwarded to Congress.

Where does the money come from?

To implement the change in SLI, this initial FY 2003 budget change seeks to shift $120 million into SLI as NASA brings in its Third Generation Reusable Launch Vehicle Program into the larger SLI fold. At the same time, $65 million will be transferred from SLI into the OSP effort (which had previously gone under the budget line as 'NASA Unique Systems").

FY 2003 efforts are just the beginning and set the tone for much more significant budget shifts in years to come. Given that the Administration seems to be focused on not raising NASA's budget (at least in the near term) the money for these changes is set to come from budget projections already identified. SLI's budget takes the biggest hit by far.

[click to enlarge] Over the five year period covered by the FY 2003 - to FY 2007 budgets, NASA plans to add $882 million for the OSP; $706 million for ISS; $662 for Space Shuttle; and $75 million into life and microgravity research. These shifts amount to $2.325 billion and would result in a decrease in SLI budgets over this period from $3.899 billion down to $1.574 billion. Incorporating the Third Generation program into SLI would inject $661 million into the SLI funding pool over the same period of time.

Summary of FY 2003 Budget Amendment Changes (Source: NASA Internal Documents)

(budget authority, $ in millions) FY 2003 FY 2004 FY 2005 FY 2006 FY 2007 Total
February FY 2003 Budget 6,422 6,518 6,490 6,666 6,835 32,931
  • Space Launch Initiative
  • 759 1,003 1,056 1,256 1,348 5,422
  • Third Generation RLV
  • 120 135 135 135 135 661
  • International Space Station
  • 1,492 1,196 1,072 1,092 1,110 5,962
  • Space Shuttle
  • 3,208 3,301 3,305 3,258 3,287 16,359
  • Biological and Physical Research
  • 842 883 922 925 955 4,527
    Changes 0 0 0 0 0 0
    Integrated Space Transportation Plan
  • Shuttle - Add to Shuttle Enhancements
  • -- 63 69 125 171 428
  • SLI - Add to Orbital Space Plane
  • 165 312 42 145 218 882
  • SLI - Reduce remaining SLI
  • -165 -582 -347 -554 -677 -2,325
  • SLI - Transfer 3rd Gen Budget
  • 120 135 135 135 135 661
  • 3rd Gen Merger with SLI
  • -120 -135 -135 -135 -135 -661
    Space Station & Related Activities
  • ISS - enhance Space Station reserves
  • 0 120 190 175 175 660
  • ISS - fund ECLSS /Node 3
  • 0 46 0 0 0 46
  • STS- Add 5th flight
  • 0 41 34 78 81 234
  • BPR cost for extra Shuttle launches
  • 0 0 12 31 32 75
    Amended FY 2003 Budget 6,422 6,519 6,490 6,666 6,835 32,931
  • Space Launch Initiative
  • 879 869 886 981 1,024 4,640
  • Third Generation RLV
  • -- -- -- -- -- --
  • International Space Station
  • 1,492 1,362 1,262 1,267 1,285 6,668
  • Space Shuttle Operations
  • 3,208 3,405 3,408 3,461 3,539 17,021
  • Biological and Physical Research
  • 842 883 934 956 987 4,602

    [Continued in Part 2]


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