[Senate Hearing 107-753]
[From the U.S. Government Publishing Office]



                                                        S. Hrg. 107-753

                             SHUTTLE SAFETY

=======================================================================

                                HEARING

                               before the

                 SUBCOMMITTEE ON SCIENCE, TECHNOLOGY, 
                               AND SPACE

                                 OF THE

                         COMMITTEE ON COMMERCE,
                      SCIENCE, AND TRANSPORTATION
                          UNITED STATES SENATE

                      ONE HUNDRED SEVENTH CONGRESS

                             FIRST SESSION

                               __________

                           SEPTEMBER 6, 2001

                               __________

    Printed for the use of the Committee on Commerce, Science, and 
                             Transportation



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       SENATE COMMITTEE ON COMMERCE, SCIENCE, AND TRANSPORTATION

                      ONE HUNDRED SEVENTH CONGRESS

                             FIRST SESSION

              ERNEST F. HOLLINGS, South Carolina, Chairman
DANIEL K. INOUYE, Hawaii             JOHN McCAIN, Arizona
JOHN D. ROCKEFELLER IV, West         TED STEVENS, Alaska
    Virginia                         CONRAD BURNS, Montana
JOHN F. KERRY, Massachusetts         TRENT LOTT, Mississippi
JOHN B. BREAUX, Louisiana            KAY BAILEY HUTCHISON, Texas
BYRON L. DORGAN, North Dakota        OLYMPIA J. SNOWE, Maine
RON WYDEN, Oregon                    SAM BROWNBACK, Kansas
MAX CLELAND, Georgia                 GORDON SMITH, Oregon
BARBARA BOXER, California            PETER G. FITZGERALD, Illinois
JOHN EDWARDS, North Carolina         JOHN ENSIGN, Nevada
JEAN CARNAHAN, Missouri              GEORGE ALLEN, Virginia
BILL NELSON, Florida
               Kevin D. Kayes, Democratic Staff Director
                  Moses Boyd, Democratic Chief Counsel
                  Mark Buse, Republican Staff Director
               Jeanne Bumpus, Republican General Counsel
                                 ------                                

             SUBCOMMITTEE ON SCIENCE, TECHNOLOGY, AND SPACE

                      RON WYDEN, Oregon, Chairman
JOHN D. ROCKEFELLER IV, West         GEORGE ALLEN, Virginia
    Virginia                         TED STEVENS, Alaska
JOHN F. KERRY, Massachusetts         CONRAD BURNS, Montana
BYRON L. DORGAN, North Dakota        TRENT LOTT, Mississippi
MAX CLELAND, Georgia                 KAY BAILEY HUTCHISON, Texas
JOHN EDWARDS, North Carolina         SAM BROWNBACK, Kansas
JEAN CARNAHAN, Missouri              PETER G. FITZGERALD, Illinois
BILL NELSON, Florida


                            C O N T E N T S

                              ----------                              
                                                                   Page
Hearing held on September 6, 2001................................     1
Statement of Senator Allen.......................................     2
Statement of Senator Hutchison...................................     7
Statement of Senator Nelson......................................     5
Statement of Senator Wyden.......................................     1

                               Witnesses

Blomberg, Richard D., Chair, Aerospace Safety Advisory Panel, and 
  President, Dunlop & Associates, Inc............................    24
    Prepared statement...........................................    26
Li, Allen, Director, Acquisition & Sourcing Management Team, U.S. 
  Government Accounting Office...................................    29
    Prepared statement...........................................    31
McCulley, Michael James, Chief Operating Officer, United Space 
  Alliance.......................................................    18
    Prepared statement...........................................    19
O'Connor, Bryan D., Director, Engineering Division, Futron 
  Corporation....................................................    36
    Prepared statement...........................................    38
Readdy, William F., Deputy Associate Administrator, Office of 
  Space Flight, National Aeronautics and Space Administration 
  Headquarters...................................................     8
    Prepared statement...........................................    10

                                Appendix

Berger, Brian, Staff Writer, Space News, ``Shuttle Officials 
  Prepare for Impending Budget Shortfall,'' article dated August 
  13, 2001.......................................................    91
Murray, Bruce, President; Huntress, Jr., Wesley T., Vice 
  President; and Friedman, Louis, Executive Director of The 
  Planetary Society, letter with attachment dated May 15, 2001, 
  to Hon. John McCain and Hon. Ernest F. Hollings................    92
Response to written questions submitted by Hon. Ernest F. 
  Hollings to:
    William F. Readdy............................................    77
Response to written questions submitted by Hon. John McCain to:
    William F. Readdy............................................    79
    Richard D. Blomberg..........................................    83
    Bryan D. O'Connor............................................    86
Response to written questions submitted by Hon. Bill Nelson to:
    Michael James McCulley.......................................    87

 
                             SHUTTLE SAFETY

                              ----------                              


                      THURSDAY, SEPTEMBER 6, 2001

                                       U.S. Senate,
            Subcommittee on Science, Technology, and Space,
        Committee on Commerce, Science, and Transportation,
                                                    Washington, DC.
    The Subcommittee met, pursuant to notice, at 2:33 p.m. in 
room SR-253, Russell Senate Office Building, Hon. Ron Wyden, 
Chairman of the Subcommittee, presiding.

             OPENING STATEMENT OF HON. RON WYDEN, 
                    U.S. SENATOR FROM OREGON

    Senator Wyden. The Subcommittee will come to order. Today, 
the Subcommittee is going to examine the issue of Space Shuttle 
safety. It is a vital issue, and certainly a timely one, as the 
U.S. Congress and, indeed, our country has an appropriate and 
important debate about our future budget priorities. I 
especially want to thank our colleague, Senator Bill Nelson of 
Florida. He has spoken repeatedly to me about the importance of 
this hearing. We have scheduled it specifically at his request, 
and I want to thank him for his leadership on these issues and 
tell him how pleased I am that he is a Member of our 
Subcommittee.
    I am of the view that Space Shuttle safety is not a luxury 
that is prioritized only when there is a budget surplus. This 
is a critical issue for our country. Reasonable people can have 
differences of opinion with respect to the best way to achieve 
the safety requirements that are necessary for these space 
flights, but let it be understood that this Subcommittee is not 
going to let anything compromise the critical safety needs for 
this and other programs that are so important to the 
development of space flight in our country.
    Beyond safety, there are a variety of questions that we are 
going to look at in the months ahead with respect to the future 
of NASA. These problems include the financial management issues 
that dog not only the Space Shuttle program but also the 
International Space Station. In fact, there is a $500 million 
shortfall in the Station's budget. The mission of the Station 
has gone from an eight-person crew performing all manner of 
scientific experiments to a three-person crew whose work is 
severely limited by the cancellation of several of the 
Station's planned modules. Clearly, the agency needs to focus 
on an integrated vision to address these concerns and move 
forward.
    Certainly, when I was a young man, when I had a full head 
of hair and rugged good looks, I used to watch space flights 
and think about how these dreams become reality. Crude rockets 
derived from war machines sent men into space and to the moon. 
The idea of a reusable spacecraft that landed on a runway was a 
dream as well. The original vision for the Shuttle was to serve 
as a so-called space truck to service a space station such as 
the one that exists today.
    When the Shuttle program took off successfully, almost 2 
decades before the Space Station did, NASA did an admirable job 
of adapting the Shuttle to new purposes. Now, however, the 
Shuttle does what it was intended to do, deliver components, 
cargo, and crews to the Station. It is clear that we are going 
to have to look beyond the technology of today and look at the 
creative possibilities of tomorrow. In light of that, we have 
to view every investment made in Shuttle upgrades and 
operations with a critical eye. Does it enhance the prospects 
and benefits of our long-term presence in space? We are going 
to hear today from witnesses who can very capably testify to 
the need for additional investment in the Shuttle.
    I want to especially commend our witnesses for their 
service to this country. As I was looking over materials that 
have been prepared by a number of them, I was particularly 
struck by a comment that was made by Richard Blomberg, who 
chairs the ASAP, the Aerospace Safety Advisory Panel. He said, 
and I want to conclude my remarks with this, and I quote here, 
``Everyone is completely aware that safety is the top priority. 
Nobody is going to cross the line intentionally. The problem, 
of course, is that you can get fairly close to the line without 
knowing it. What price will be paid down the road is not clear, 
and I don't mean the dollar price.'' I think that is a very 
appropriate comment to make.
    This Committee is committed to ensuring that this program 
and the other space programs clearly are on the line that 
ensures that our citizens who are involved in this work have 
every possible safety precaution in place. With that, I would 
like to yield to my friend and colleague, Senator Allen, our 
Ranking Minority Member.

                STATEMENT OF HON. GEORGE ALLEN, 
                   U.S. SENATOR FROM VIRGINIA

    Senator Allen. Thank you, Mr. Chairman, and thank you for 
calling this hearing today. I very much appreciate your 
leadership and that of Senator Nelson and Senator Hutchison as 
well on this matter that I know is of great concern to all 
Americans, and particularly in this Subcommittee.
    I would also like to welcome our guests here today. This is 
a very distinguished panel. I look forward to hearing the 
testimony of a variety of great insights into this issue. Mr. 
Readdy; Mr. McCulley, a genuine hero; Mr. Blomberg; Mr. Li; and 
Mr. O'Connor. Your insights will be very helpful to us.
    The reason we care about this is that the Space Shuttle is 
a very unique and, indeed, it is a national asset, and we do 
have to take good care of it, but also not just be happy with 
the way things are, the way things have been, but where it can 
go into the future. I think some are very correct when they say 
the Space Shuttle is an example of some of the very best, if 
not the best, that the United States has to offer in our 
ability not just the technical, but the ability to achieve our 
dreams, and to reach for the stars, and live in the stars, so 
to speak, into reality.
    Now, the Space Shuttle has been around for 20 years, and 
even today, everybody in the country stops and holds their 
breath whenever the Space Shuttle is being launched. Some of 
that is because of the tragedy back in 1986, but Americans are 
still in awe and, indeed the world is, and I think we all do 
recognize the risks that our American astronauts are taking 
each time that an orbiter is launched.
    Each launch represents the coordination of so many highly 
technical, sophisticated systems that it is almost 
inconceivable that they all go right, which makes you wonder, 
you know, what if one goes wrong, and that is where I think 
some of the advancement and some of the ideas that you all have 
been talking about as far as using technology to address 
safety. So you are not relying just on human eye-balling and 
idea, but have a system that double or triple checks that, 
because there are so many systems that need to be coordinated 
for safety and also for the efficient operation of the 
particular mission.
    And NASA has, through all of this, continued to make the 
Shuttle assembly safer and more reliable after many years of 
operation, but again we need to not only applaud those efforts, 
but also look forward to the implementation of additional 
developmental efforts in this area.
    I am disappointed, as was also reflected by Senator Wyden, 
our Chairman of the Subcommittee, that the budget for fiscal 
year 2002 has a shortfall. A shortage of over $200 million, 
combined with the cost overruns of the International Space 
Station of over $4 billion, has made for a very tough 
situation--I will use that phraseology--a very tough situation 
in Human Space Flight right now in NASA. We should be, I think, 
concerned with these budgetary problems, but as unfortunate as 
all this is, it does not mean that this should be something you 
say, ``Well, we cannot be ambitious any longer.'' I think we 
have to have some very important technological problems solved. 
The programs that are being addressed I do think make some 
sense. Some--in my view as a layman trying to be a juror so to 
speak, listening to you all as experts--some make more sense 
than others. Some you scratch your head and just wonder, well, 
how can you be so far off on some of these estimates, and maybe 
some of your testimony will reflect on that. But we still have 
to advance the state of human space flight and advance the 
state of research. This is absolutely essential.
    Mr. Chairman, as you know, and we all know very well, our 
economy and, indeed, the success of the United States is based 
on a continuous flow of technological advancements and, indeed, 
on a spirit of our continual innovation and improvement, which 
have been and always must be part of our nature, our culture as 
Americans. Whether it is questing or pioneering or advancing 
better improvements, technological advancements have always 
been what has made America great, and it has to continue in the 
future.
    Now, we know that space is considered to be one of the next 
growth areas for major economic development. The reality is 
that NASA is responsible for much of the technological 
underpinning of this growth, and we must recognize that the 
space-based problems that we are discussing and will be 
discussing here today and in the months to come could have very 
valuable impacts on the quality of life and in the future here 
on earth.
    Furthermore, I am concerned about the effects that these 
cost overruns will have on the other programs at NASA, such as 
Aeronautics. I have major concerns for this area of research in 
Aeronautics, given the problems we are now experiencing in the 
aviation community. The Senate has spent a lot of time ensuring 
a balanced budget, so to speak, at NASA, and we should not let 
any one program become the total focus of the agency. 
Aeronautics and aviation have been neglected, I think to our 
nation's economic and security detriment, and all of these and 
more concerns were brought up in an earlier hearing we had on 
the subject of Aeronautics. Suffice it to say, as these 
concerns of funding come about, NASA should not be taking it 
out of the Aeronautics aspect of it. It will have to be handled 
some other way, other than raiding that pocket, or that aspect 
of NASA.
    On a separate note, Mr. Chairman, you mentioned and alluded 
to it, and we seem to both be disturbed as much as anyone to 
learn from the recent GAO report that NASA has not been able to 
provide detailed transaction-based support amounts charged to 
the Space Station and Shuttle programs, as required by the cost 
limitation provisions contained in last year's authorization of 
NASA.
    I know the cost limitation provision was something that--I 
was not here, but in researching for this hearing--I know that 
the then and current Chairman and Ranking Member, Senator 
McCain and Senator Hollings, spent a great deal of time on that 
issue, and I know that our GAO witness is not here to 
specifically address that report, but we all look forward to 
more discussions on this matter both with the GAO and also with 
NASA.
    But the Space Shuttle program right now, with this budget 
situation, and the challenges you are facing, we know is in a 
very tough situation. There are shortfalls in the budget, there 
are infrastructure concerns, and there are work force issues. 
Many of the work force issues are not unique, I would say, to 
space. You hear that in aviation, you hear that in many 
technology areas, but many times in life, struggling becomes 
the pathway to success, and I think that this can happen if we 
acknowledge whatever problems exist now, deal with them 
honestly, and then I hope what we can accomplish here today 
with the insight and expertise of these five gentlemen here, we 
can at least find the pathway to move forward, because I think 
it is essential for our security, it is good for our economy, 
and it is also just the way Americans ought to be, always 
questing to do better, always improving, always innovating.
    I thank you again, Mr. Chairman, for having this hearing, 
and thank all these gentlemen for sharing their time and 
expertise with us. Thank you.
    Senator Wyden. Thank you. Senator Nelson.

                STATEMENT OF HON. BILL NELSON, 
                   U.S. SENATOR FROM FLORIDA

    Senator Nelson. Mr. Chairman, I want to thank you for 
having this meeting. I want to thank Senator Daschle for 
putting me on this Committee. I want to thank Chairman Hollings 
and Senator McCain for talking to Senator Daschle to put me on 
this Committee.
    Senator Wyden. That leaves only 96 Senators left.
    [Laughter.]
    Senator Nelson. Well, we have a lot at stake in this 
hearing. Senator Allen, I am grateful for your interest. 
Senator Hutchison, you have a great deal at stake in the 
subject matter of this hearing, and I am grateful for your 
interest and your support. I am grateful to the expertise that 
we are going to hear from today, which is going to be 
unvarnished testimony, and I am grateful to a lot of the people 
in this room today who share the passion with all of us that we 
want to continue to have a robust, Human Space Flight program. 
That is what we are talking about, ultimately, the bottom line: 
are we going to continue to have a successful manned space 
flight program?
    We are not talking about dry numbers and ledgers today. 
Make no mistake about that. We are talking about the men and 
women who serve their country by exploring its frontiers. We 
are talking about an exploration program, since Alan Shepard 
first lifted off in 1961, that has provided the most valuable 
research available to people anywhere, because NASA technology 
has touched the lives of Americans every day in every way. More 
than 1,300 documented NASA technologies have gone beyond the 
space program, including freeze-dried foods, cordless power 
tools, and miraculous medical advancements such as CAT scans 
and kidney dialysis machines, and this Space Shuttle program 
alone has generated more than 100 technology spin-offs, 
including the artificial heart, developed through technology 
used in the Space Shuttle fuel pumps, and even the insulating 
materials in NASCAR race cars have come from Shuttle thermal 
technology.
    So as we move forward in this hearing, this is the 
importance of the funding question before us. This is the 
importance of making certain that we build, maintain, and fly 
the safest vehicles possible, and it is against this backdrop, 
and this history of our space program, that we now delve into 
these very serious funding and safety questions that have been 
raised.
    So Mr. Chairman, thanks to you and Senator Allen. I have 
asked for this panel of experts to speak to our Subcommittee 
today, because I fear that if we do not provide the Space 
Shuttle program with the resources it needs for safety upgrades 
in the future, our country is going to pay a price that we 
cannot bear. This proposed budget abandons some of the most 
critical safety upgrades of our aging fleet, and mind you, it 
is aging. It was developed in the seventies, starting in the 
early seventies. It first flew in 1981, and now, under 
increased budget pressures, we have got tough decisions to make 
about spending priorities.
    But our budgetary decisions should not come at the risk of 
astronauts' lives and, in fact, whether or not--ultimately, the 
bottom line is whether or not we are going to have a Human 
Space Flight program. This budget fails to adequately protect 
these and future astronauts.
    Most think that we are going to continue to fly the Shuttle 
for another 20 years. Now, mind you, let me repeat that. Most 
people in this room will agree that we are going to fly this 
existing fleet of Space Shuttles for another two decades. That 
was not the plan. There was going to be a follow-on vehicle, 
and a lot of these budgetary decisions predicated in this 
budget were on the fact that we were going to have a new 
vehicle ready, and therefore these safety upgrades were not 
going to be necessary. So we are basing, if we do not watch 
out, our budgetary decisions on the long-lost premise that the 
Shuttle would be replaced in 2 or 3 years.
    But this is not proper planning, and this is not putting 
safety first. This is putting the safety of our Shuttle fleet, 
the crews, the cargoes, as well as the people on the ground 
supporting the Shuttle, all at an unnecessarily high risk. In 
order to pay for continued operations of the Shuttle fleet at a 
flight rate of 6 per year. By the way, I compliment these 
folks, because they just had 8 very successful flights in 11 
months.
    But if we are just looking at a rate of only 6 per year in 
the face of these budget constraints, then NASA is abrogating 
its commitment to upgrade the Shuttle orbiters by canceling, by 
deferring, or by stretching out its previous upgrade plan. At 
the same time the agency has yet to request any funds to make 
improvements to the ground infrastructure, which is literally 
falling apart. You cannot have infrastructure at the Kennedy 
Space Center with all that salt air, and with hurricanes coming 
by every now and then, and not have those upgrades.
    So safety improvements considered critical two years ago 
are now discretionary projects subject to available funding. 
All but one of the Shuttle's pending safety upgrades have been 
targeted for cancellation or deferral. That is unacceptable, 
when our motto is supposed to be safety first.
    NASA has canceled continued work on the Electric Auxiliary 
Power Unit, even though this upgrade was previously considered 
to be one of the highest safety priorities of the agency. At 
Kennedy, in order to protect people from huge pieces of 
concrete falling from the ceiling of the vehicle assembly 
building, a net has been strung up to catch any falling items.
    The Shuttle program part of NASA's budget is $218 million 
short in the next fiscal year, and in the absence of a 
permanent leader for the agency, and I say that in reality, 
because the new Administrator has not been named, decisions 
about NASA priorities are coming not from NASA, but from bean 
counters at the Office of Management and Budget.
    I said I was going to talk unvarnished, but I am talking 
truth. We have got accountants making life and death technical 
decisions for our astronauts and our ground crews, instead of 
the engineers and the program managers who have dedicated 
themselves to keeping the United States in the forefront of 
space exploration. Now, we here have an opportunity to fix this 
problem, because this hearing is timely, because the VA-HUD 
conference committee meets next week, which includes NASA 
appropriations.
    I have talked to Senator Mikulski, who chairs the VA-HUD 
Subcommittee, about this. They have the ability to increase the 
budget to pay for some of these safety improvements that are so 
critical to our Shuttle program, and I urge you all, as you 
hear the testimony today, and I have talked with Fritz 
Hollings, he is going to the floor with his Commerce-Justice 
Appropriations bill this afternoon, so he cannot be here. I 
have talked to John McCain. Senator McCain is in the markup on 
the Armed Services Committee right now, but he is going to try 
to get in.
    I urge all my colleagues to seek the reprioritization in 
the conference committee of the funding for this program, and 
as it stands, what we are doing, if we do not do anything, we 
are starving NASA's Space Shuttle budget, and thus greatly 
increasing the chance of a catastrophic loss. I wonder if the 
lessons of Challenger are fading.
    So let me say that the witnesses here can speak the truth. 
We all have great respect for all of you. You are extremely 
accomplished. You all believe in NASA's future. You believe in 
our Human Space Flight program, and you believe in reducing the 
risk for our astronauts and ground crews to the lowest possible 
acceptable level, and I also believe, I personally believe that 
you all have had your hands tied, that in recent months--and I 
am not talking about just this Administration.
    Please understand this has nothing to do with partisan 
politics. I am talking about the direction that this has taken 
over the last decade, that you all have had your hands tied 
over the years, but we are dealing with the now, because 
decisions have been taken out of your hands, and you are out of 
the decision loop, and I hope you can get back in it, but the 
witnesses here on this panel represent the wealth of wisdom 
that we in the Congress had better start listening to.
    So Mr. Chairman, I thank you for the privilege of being 
here today.
    Senator Wyden. I thank my colleague for an excellent, 
excellent statement, and we are anxious to work with him on 
these matters.
    Senator Hutchison.

            STATEMENT OF HON. KAY BAILEY HUTCHISON, 
                    U.S. SENATOR FROM TEXAS

    Senator Hutchison. Thank you, Senator Wyden. I thank you 
for calling the hearing. Senator Nelson, you are certainly a 
welcome addition to the Committee. I did not know it was so 
hard for you to get here, but I am glad you are here, and 
certainly Senator Allen has been a long-time supporter of 
engineering and research and space, and I look forward to 
working with all of you.
    The fact of the matter is, the NASA budget and the Senate 
Appropriations Committee final result is a disaster. It is a 
disaster for the International Space Station, and without the 
Space Station there would be no reason for a Shuttle. I led the 
fight in the appropriations process last time to upgrade the 
Shuttle and the safety that was necessary for the Shuttle, 
because we all lived through the Challenger disaster, and none 
of us want to see that happen again, ever--ever.
    But to short-change the vehicle for the scientific 
research, which is the Space Station, would be just 
irresponsible. So I think we have all got to come together and 
try to work through the appropriations process to secure 
adequate funding for the Station, to make sure that we stop 
these overruns, which no one thinks is acceptable, and to go 
forward making safety our first priority and making sure that 
we have the scientific basis for NASA, or we are going to see 
NASA careen into a nonfunctioning agency.
    You cannot lose any part of NASA--as Senator Allen said, 
you have got to have your aeronautical research, you have got 
to have your engineering. All of the things that Senator Nelson 
mentioned that we have gotten from our space research--the CAT 
scans, the MRI's, all of these things--are so much a part of 
the investment we have made in NASA. But to all of a sudden 
start whittling away at the Space Station and keep all of the 
parts that would service the vehicle that we are whittling away 
is crazy. So we have got to have a plan that makes sense, that 
keeps a solid, research facility in the Space Station, and does 
the upgrades for the Shuttle that would make it not only safe, 
but also a good service tool for the space station. That is 
what I want to work for, and I hope all of us will be able to 
come together when we get to this appropriations bill and try 
to make sure that we are doing the right thing for our goal, 
which is the research capability.
    Thank you, Mr. Chairman.
    Senator Wyden. Thank you.
    Gentlemen, you have just heard four United States Senators 
say they want to work with you on this important issue, and 
suffice it to say it is going to be a challenge in this 
budgetary environment. We will make your prepared remarks a 
part of the hearing record in their entirety. We have asked 
each of you to try to keep within 5 minutes or thereabouts. Let 
us begin that end of the table with the NASA folks and we will 
go right down the line, Mr. McCulley, Mr. Blomberg, and let us 
proceed.

       STATEMENT OF WILLIAM F. READDY, DEPUTY ASSOCIATE 
        ADMINISTRATOR, OFFICE OF SPACE FLIGHT, NATIONAL 
       AERONAUTICS AND SPACE ADMINISTRATION HEADQUARTERS

    Mr. Readdy. Chairman Wyden, Senator Allen, members of the 
Subcommittee, thank you for the opportunity to testify before 
you today. First, though, I would like to compliment fellow 
astronaut Senator Bill Nelson on his timely editorial in this 
week's Space News. As proud as we are of the past 20 years of 
achievement and over 100 Space Shuttle missions, we must never 
allow our current successes to cause complacency to set in.
    Today, just as in 1981, a safe and successful Space Shuttle 
launch is the only metric the world uses to judge the quality 
of NASA's Human Space Flight program.
    Since Challenger, with your steadfast support we have 
continued our quest to improve the Space Shuttle safety. Our 
loss of vehicle rating has gone from one in 78, post 
Challenger, to one in 483, and while maybe that is acceptable 
to the general public, and they would label this quite an 
accomplishment, to us it is not sufficient. In the realm of 
human space flight, 95 percent is not an A, 99 percent is not 
an A. Anything less than 100 percent is an F.
    Modern day fighters such as the F-22 are on the order of 1 
in 10,000. Modern airliners like the Boeing 777 have a safety 
level of 1 in a million, or 2 million. These statistics show us 
that even though we have achieved significant improvements in 
the first generation of reusable human space flight, we have a 
long, long way to go, and we need upgrades to get there.
    At present, the Shuttle is the safest, most capable and 
reliable vehicle in history. We have flown more than 80 
successful missions since return to flight, and I have to 
applaud the NASA/contractor Shuttle team for its superb 
stewardship to date in continuing to fly safely and 
accomplishing the most complex of missions in assembling the 
International Space Station, servicing the space telescope, and 
doing space research against a background of a 40-percent 
reduction in budget purchasing power. This is nothing short of 
remarkable.
    That said, beginning in fiscal year 2002, we have reached a 
point where simply accounting for inflation may eclipse future 
efficiencies and could foreclose our options to recapitalize 
this program. To be more specific, our Apollo era 
infrastructure is aging, obsolescence issues are arising more 
frequently, many of our vendors are going out of business, and 
the operating costs for our contractors are going up.
    In 1997, NASA established a Space Shuttle Program 
Development Office at the Johnson Space Center for the purpose 
of systematically identifying, prioritizing the required 
upgrades that would maximize flight safety, mission success, 
and improve the end-to-end reliability of the total Space 
Shuttle system.
    Since 1997, NASA has implemented many safety and 
performance upgrades, super lightweight tank, the new, improved 
Block II's Space Shuttle Main Engine (SSME), and the glass 
cockpit all come to mind, and because of the improvements in 
the Space Shuttle Main Engines, we have reduced the risk of 
launch failure by 80 percent. We have increased the launch 
probability to support International Space Station limited 
launch windows of 5 minutes or less, and we have increased the 
payload to orbit by 8 tons.
    Two years ago, Congress took the leadership in providing a 
plus-up to start the Space Shuttle upgrades program. In the 
fiscal year 2000 budget, and subsequently, the Office of 
Management and Budget established a challenging goal of 
implementing all safety upgrades starting in 2005. Given the 
current budget environment, and all the reasons I mentioned 
above, it is now anticipated that development of these safety 
upgrades would not be completed until 2005, with implementation 
into the fleet actually beginning in 2007.
    Although our upgrades program has been focused on vehicle 
improvement, the vehicle is only one part of a vehicle 
integrated system. Ground facilities that support training, 
processing, launch, landing operations are all equally critical 
to mission success and the safety of our astronauts. This 
infrastructure includes facilities located literally across the 
country, some in fact overseas, much of which was built during 
the early sixties in support of the Apollo program.
    Current Space Shuttle infrastructure revitalization 
projects are predominantly focused at the Kennedy Space Center, 
where currently there are four major vertical assembly building 
projects, but to date the Space Shuttle program has only been 
able to address these projects on an emergent case-by-case 
basis.
    In the mid-nineties, NASA underwent significant downsizing. 
At NASA headquarters, the Civil Service work force went from 
2,200 to 1,000. Within the Office of Space Flight, where I 
work, we went from 240 to 80, and within the Space Shuttle 
Program Office the Civil Service count went from 4,000 to the 
current count of approximately 1,700.
    In 1999, when the NASA centers were experiencing a 
shortfall of people with critical skills for the International 
Space Station, Space Shuttle, and advanced space transportation 
programs, Office of Space Flight received permission to 
discontinue the downsizing and commence rehiring, and with 
respect to the Space Shuttle, those hires focus on the 
increased flight rate for the International Space Station, and 
the safety upgrades program.
    To conclude, I would like to reemphasize that safety 
maintainability obsolescence issues must not be allowed to 
threaten our nation's only human-rated access to space. 
Delaying the implementation of key improvements could expose 
future flight crews to higher levels of risk for longer than is 
necessary.
    We accept the fact that human space flight and the quest to 
explore and develop space does not come without risk. We have 
accomplished much over the past decades. Our continued success 
in this undertaking depends on never overlooking the fact that, 
along with the astronauts on board those Space Shuttles, a 
little piece of all of us flies on each and every mission.
    Thank you.
    [The prepared statement of Mr. Readdy follows:]

       Prepared Statement of William F. Readdy, Deputy Associate 
 Administrator, Office of Space Flight, National Aeronautics and Space 
                      Administration Headquarters

Mr. Chairman and Members of the Subcommittee:

    Thank you for this opportunity to testify on the subject of Space 
Shuttle safety. There is no higher priority for NASA than the safe 
launch, operation and return of our Space Shuttle vehicles and their 
astronaut crews. The Space Shuttle represents assured human access to 
space for this nation for at least the next decade, and is 
indispensable to the success and viability of the International Space 
Station (ISS).
    NASA's Space Shuttle program has been one of the agency's real 
success stories over the last several years. The program, working with 
their contractors, has made significant reductions in operations 
costs--by about a third even before accounting for inflation. At the 
same time as the operations costs have been coming down, the Space 
Shuttle has made dramatic improvements in the capabilities, operations 
and safety of the system. The payload-to-orbit performance of the Space 
Shuttle has been significantly improved--by over 70 percent to the 
Space Station. The safety of the Space Shuttle has also been 
dramatically improved by reducing risk by more than a factor of five. 
In addition, the operability of the system has been significantly 
improved, with five minute launch windows--which would not have been 
attempted a decade ago--now becoming routine. This record of success is 
a testament to the quality and dedication of the Space Shuttle 
management team and workforce, both civil servants and contractors.
    The fact that the Space Shuttle is the safest, most capable, and 
reliable space transportation system in the world is due, in large 
part, to the commitment of NASA, the White House, and the Congress to 
make the necessary improvements across the system to ensure safety and 
mission success. Let me assure you, however, that this has not been an 
easy task. It has taken exceptional leadership and an unfailing 
commitment to safety to navigate through a prolonged period of steadily 
decreasing budgets, although the last 2 years have seen increases in 
the Shuttle request. We have delayed needed investments in support 
equipment and infrastructure that today present themselves as 
significant management challenges.
    We find ourselves searching for innovative methods to achieve 
additional operational efficiencies while continuing to safely fly the 
Space Shuttle fleet through 2012. The truth is that most significant 
efficiencies have already been realized. Since submission of the 
President's FY 2002 budget request, the program has projected increased 
costs for Shuttle operations for FY 2002 and the outyears, some of 
which is driven by factors beyond the control of the Shuttle Program. 
These include contractor rate increases, core skill and business base 
erosion, supportability/obsolescence issues, and energy cost increases. 
Internal cost increases are largely driven by the cost of orbiter 
operations support, such as critical re-wiring on the mature orbiter 
fleet.
    In the following testimony, I will address the subjects of Space 
Shuttle upgrades, infrastructure revitalization and the Space Shuttle 
workforce as they relate to Space Shuttle safety in FY 2002 and beyond. 
I will also address NASA's FY 2002 Budget Plan for the Space Shuttle 
and associated challenges related to these same subjects.
    The primary objective of safety upgrades to Space Shuttle systems 
is to achieve major reductions in the operational risks associated with 
those systems, and to provide safer Space Shuttle operations through 
system safety upgrades. NASA's FY 2002 budget request provides a large 
increase to the Space Shuttle safety allocation, from $256 million in 
FY 2001 to $406 million in FY 2002. The total Space Shuttle budget in 
FY 2002 and the out-years is flat, and does not provide for adjustments 
due to inflation in anticipation of achieving incremental operational 
efficiencies. NASA has been conducting an external review to assess how 
the Safety Allocation funds can most effectively be used to improve the 
safety of the Space Shuttle, to include investments in hardware/
software upgrades, personnel, facilities, or other safety-related 
areas. NASA will proceed with investment activities once Authority To 
Proceed (ATP) has been accomplished. Space Shuttle safety investments 
are an important element of NASA's strategy for an Integrated Space 
Transportation Plan (ISTP).
    Cost challenges to the Space Shuttle Program and upgrade technical 
issues are presenting significant potential impacts to increasing Space 
Shuttle safety. Some individual safety upgrade projects are being 
evaluated for cancellation or deferral in FY 2002, due to either 
technical issues or to pay for increased costs that were not known at 
the time of the FY 2002 budget submission. These issues will be 
addressed as we work with the Administration in formulation of our FY 
2003 budget. In our deliberations we will try to avoid near-term 
decisions at the expense of improved safety (current risk) in order to 
preserve a safe and viable six flight rate per year core Space Shuttle 
program. We will also seek to address facilities and infrastructure 
requirements in the program.

Space Shuttle Upgrades and Program Achievements
    The Space Shuttle is a very mature system, remarkably reliable, 
very mission flexible, and a true testbed--not just for scientific 
inquiry, but also for forming international partnerships and goodwill. 
Wise investments in safety upgrades during the course of the program 
have kept the Space Shuttle viable and ready to meet the needs of our 
nation's space program.
    High Launch Rate Reliability--Of 106 launch attempts, there have 
been 105 successful launches, equating to a launch reliability of 
greater than 0.99. Let me add to that, Mr. Chairman, that while we are 
proud of our accomplishments, anything less than 100 percent is still 
unacceptable in a Human Space Flight program.
    Mission Diversity--The Space Shuttle has launched over 3 million 
pounds of cargo and over 600 humans from around the world. The Space 
Shuttle is the only launch system in the world that can deliver and 
return large payloads to and from orbit. Each Space Shuttle flight can 
support a diverse package of mission objectives. The Space Shuttle is 
very flexible in accommodating all types of missions, including those 
dealing with national security.
    International Leadership--No other country has been able to 
integrate the technical, operations management, and financial resources 
to develop its own human-rated RLV system. At least 38 percent of the 
Space Shuttle flights so far have carried non-U.S. astronauts. This 
percentage will increase as we continue to assemble and operate the 
International Space Station.
    Invaluable RLV Operating Experience--The Space Shuttle Program has 
provided over 20 years of invaluable experience in Reusable Launch 
Vehicle (RLV) Payload Integration and Flight and Ground Operations. It 
has produced a massive database of technical information from which 
future improvements will be made to next generation RLVs.
    Privatization--The Space Flight Operations Contract has proven to 
be successful in finding efficiencies and reducing cost. Lessons 
learned with this effort will ultimately pave the way for further 
privatization of the Space Shuttle that is envisioned under the 
President's Blueprint.
    Space Shuttle Technology Spin-offs--The trickle-down of benefits 
from the Space Shuttle Program continues to impact the development of 
new electronic devices, medicines, improved manufacturing procedures. 
The Space Shuttle Program in the U.S. private industry has created 
thousands of jobs.

Space Shuttle Upgrades Program--Objectives and Strategy
    The Space Shuttle Upgrade program is intended as a proactive 
measure to keep the Space Shuttle flying safely and efficiently in 
support of the Agency's commitments and goals for human access to 
space. Shuttle Upgrades are intended to enhance the primary goals of 
the Space Shuttle Program:

    Fly safely;
    Meet the manifest;
    Improve mission supportability; and,
    Improve the system.

    The two types of Space Shuttle upgrades are safety (high priority) 
and supportability. Safety upgrades are those upgrades that minimize 
ascent, descent, and critical operations risks. Supportability upgrades 
are those upgrades that maximize Flight Hardware Availability Assurance 
(FHAA), and Operational Improvements (OIs).
    The following table illustrates the focus areas for Shuttle 
Upgrades over the last several years.


----------------------------------------------------------------------------------------------------------------
                       Main Focus                                                Examples
----------------------------------------------------------------------------------------------------------------
Shuttle Safety; Supporting the ISS                       SSME Alternate turbo pump
                                                         Super Lightweight Tank
----------------------------------------------------------------------------------------------------------------
Combating Obsolescence                                   Checkout and Launch Control system
----------------------------------------------------------------------------------------------------------------
Enhanced Capability (does not change the fundamental     Avionics
 Shuttle configuration)                                  Extended Nose Landing Gear
                                                         Long life Fuel Cell
----------------------------------------------------------------------------------------------------------------

Space Shuttle Upgrades Selection Process
    Any Space Shuttle Program Element or Project Office may propose 
potential candidate projects to the Space Shuttle Program Development 
Office (SSPDO). The recommending organization is responsible for 
providing a technical description of the proposed upgrade concept, the 
rationale for the proposal in terms of benefit to the program, and a 
rough order-of-magnitude estimate of cost and schedule to implement.
    The SSPDO scores and weighs the proposals with respect to how well 
they meet Program goals and objectives of flying safely, meeting the 
manifest, improving supportability, and improving the system. The 
primary goal of the selection process is to allocate resources, on a 
priority basis, to the significant safety improvement opportunities and 
significant supportability needs. Approval of upgrade candidates is an 
ongoing activity of the Upgrades Review Board.
    NASA's upgrade investment strategy is to pursue high priority 
safety upgrades, supportability and obsolescence upgrades. The 
principal discriminators for the high-priority safety upgrades are the 
degree of safety improvement, and how quickly the associated benefits 
can be realized.
    The upgrade portfolio consists of project proposals in various 
stages of definition and approval. These proposals include those 
undergoing initial definition and feasibility assessments, those that 
have received formal approval for further definition and implementation 
planning, and projects that have been approved for implementation and 
thus form the base lined Space Shuttle Safety Upgrades Program content. 
Addendum 1 shows the Shuttle Safety Upgrade Schedule Strategy and 
Addendum 2 depicts the organizational relationship of the SSPDO to the 
OSF.

High Priority Safety Upgrades List
    The current Upgrades plan calls for High Priority Safety Upgrades 
which, all combined, have the potential to reduce the overall risk of a 
catastrophic loss of vehicle by a factor of two. All total funding 
figures listed below are in the President's FY 2002 Budget request.
    The Cockpit Avionics Upgrade (CAU) Increments I & II, totaled $20 
million in FY 2000 and $40 million in FY 2001. The total funding is 
estimated to be around $500 million. These upgrades will provide: 1) 
access to more systems data; 2) increased organization of data display 
and command capabilities; and, 3) improve human-to-machine interface, 
all of which reduces crew workload in the cockpit during all phases of 
the mission. Implementing the CAU into the Space Shuttle fleet in a 
timely manner with other Space Shuttle upgrades will: 1) reduce the 
cost of scheduling separate Orbiter Maintenance Modification periods, 
2) increase the quality of the training of Shuttle astronauts, and 3) 
eventually begin to further lower the Loss of Vehicle (LoV) risk.
    The Electric Auxiliary Power Unit (EAPU) would have replaced the 
Orbiter's three hydrazine power unit. Using battery-powered electric 
motors to replace the hydrazine system and high-speed turbines, this 
upgrade would have eliminated the potential of extremely toxic and 
hazardous conditions for processing and in flight. However, due to 
technical issues, this upgrade will not go forward and instead will be 
a technology development effort in FY 2002.
    The Advanced Health Management System (AHMS) Phase I & II upgrades 
to the Space Shuttle main engines will provide improved real-time 
monitoring of engine performance and environmental data, will provide 
improved engine health advisories to the onboard crew and ground 
controllers, and will provide improved engine anomaly response 
capabilities. The AHMS will reduce the risk of catastrophic engine 
failure by up to 40 percent. This project has been allocated $13.8 
million in FY 2000 and $17.7 million in FY 2001. The total funding is 
$155 million.
    The Solid Rocket Booster (SRB) Advanced Thrust Vector Control (TVC) 
upgrade, if implemented, will replace the hydrazine power turbines 
currently used to drive the hydraulic pumps with helium. This 
eliminates hydrazine leakage/fire hazards, turbine over speed hazards, 
and reduces toxic materials processing hazards. This project was 
allocated $5 million in FY 2000 and $11 million for studies in FY 2001. 
The total funding is $207 million.

Safety Upgrade Studies
    Studies are also being conducted in several areas of high risk. The 
completion of these studies is vital to successfully supporting our 
safety upgrade efforts and may result in the selection of additional 
upgrade candidates to be prioritized and reviewed within the proposed 
five-year period of safety upgrade development (FY 2001-FY 2005).
    Crew Escape Engineering Design Trade Study--This is an in-depth 
engineering study of contingency crew survival options; extraction, 
ejection, crew module separation; determine feasibility, survival 
utility, cost, and technical impacts; increases probability of a 
successful crew bailout.
    Thermal Protection System (TPS) Lower Surface Tile Study--This 
study will develop a more durable lower surface tile for the bottom of 
the Orbiter which would reduce the risk of tile burn-through, reduce 
post-landing repair, and may provide additional micro-meteoroid and 
orbital debris protection.
    Self-Contained Apparatus Protective Ensemble (SCAPE) Suit 
Improvement Study--The objective of this study is to develop a safer 
and more efficient SCAPE suit used for hazardous operations during 
ground processing; the current suit is heavy, allows undesirable levels 
of carbon dioxide, and is not efficiently cooled.
    Space Shuttle Abort Improvements Study--This study will investigate 
Space Shuttle hardware, software and procedural improvements to 
eliminate/decrease specific abort scenarios, reducing the areas of no 
coverage, eliminate abort scenarios, and increase probability of a 
successful abort.
    Main Landing Gear (MLG) Tire Study--This study is investigating 
improved tire designs that allow for higher landing speeds, increase 
cross winds limits, increase the landing load limit, mitigate 
obsolescence issues, and improve margins for pressure leakage and 
colder temperature environments.
    SSME Block III Study--This study would investigate the 
incorporation of an Extra Large Throat Combustion Chamber and a more 
robust channel wall constructed nozzle, increasing performance margins 
and abort thrust capability and eliminating main combustion chamber and 
nozzle failure modes. However, due to technical issues, this study is 
being discontinued.
    The Industrial Engineering for Safety (IES) Study--This study is a 
significant and comprehensive effort to increase flight and ground 
safety through improved handling and inspections via changes in flight 
and ground hardware and ground procedures and processes. Within this 
study, several small projects are in formulation, and a few projects in 
this category have been authorized for implementation.
    No candidate upgrades will be approved until NASA's overall safety 
investment strategy has undergone external independent review by the 
Office of Space Flight's (OSF) Space Flight Advisory Committee (SFAC) 
to assure that only technologically ready projects will be pursued. 
Moreover, NASA must complete its full management review process to 
ensure that the cost is fully defined, accurate, and has sufficient 
reserves to ensure that it can be completed within the overall safety 
allocation. Approved projects will be reviewed annually, and 
reprioritized if necessary, to make sure that they are managed within 
the plan.

Supportability/Infrastructure Revitalization
    Another issue of concern for the Space Shuttle Program is 
maintenance of the ground infrastructure that is so vital to the 
continued success of the program. We recognize the importance to the 
Space Shuttle Program of the facility structures, systems and test 
support equipment. That importance extends across all stages of the 
program from manufacturing, assembly, testing, transportation, 
processing, and all the way through launch, SRB retrieval, and the 
final landing of the orbiters. We have identified the projects that are 
required to revitalize the Shuttle infrastructure over the next decade. 
There are over 200 projects that will eventually need to be completed. 
Many of these projects are required to revitalize a set of buildings, 
systems, and equipment that were developed for the Apollo program and 
then retrofitted to accommodate the Space Shuttle.
    The Space Shuttle infrastructure revitalization projects are 
predominantly focused at the Kennedy Space Center (KSC), but there are 
also many important projects required at Marshall Space Flight Center 
(MSFC), Johnson Space Center (JSC), Stennis Space Center (SSC), White 
Sands Test Facility (WSTF), and the Michoud Assembly Facility (MAF). 
The highest priority projects are at the Launch Complex 39 (LC-39) area 
at KSC, including projects at both Pads A & B and the Vertical Assembly 
Building (VAB). There are four major VAB revitalization projects needed 
for the roof, siding, door openings, and the door mechanisms that need 
to be addressed in the near future. Other key KSC projects include 
refurbishment of the high-pressure gaseous nitrogen and helium 
pipelines, communications cabling replacement, power distribution 
systems, and refurbishment of the crawler/transporters that move the 
Orbiters from the VAB to the launch pads.
    The Space Shuttle Program has addressed these projects to the best 
of its ability. This has been accomplished while at the same time 
flying an accelerated set of missions over the past two years in 
support of the ISS, and initiating the Space Shuttle Upgrades program 
that will enable the Space Shuttle to fly safely well into the second 
decade of the 21st century. Our Space Shuttle philosophy places the 
highest priority first and foremost on crew safety and then on mission 
success. These priorities, when coupled to the challenging budget 
realities facing the entire Federal government, requires us to place 
our funding priorities on meeting the operational requirements of the 
Space Shuttle and on the high priority need for safety upgrades. We 
have tackled the most urgent infrastructure projects, but we have had 
to defer action on a number of projects that we feel are very important 
to the program and, if not addressed in the near future, could at some 
point impact mission schedules. We would like to perform more 
infrastructure projects, and at the same time strike the difficult 
balance between ensuring the operational requirements of the Orbiter 
and maintaining an extensive ground infrastructure that is also 
critical for the successful long-term operation of the Space Shuttle 
Program.

Space Shuttle Upgrades Independent Assessments
    Over the past three years, OSF has relied on several advisory 
organizations like the SFAC and the Aerospace Safety Advisory Panel 
(ASAP), to provide comprehensive review and feedback, assessing the 
definition and prioritization of Space Shuttle Upgrades. Both of these 
organizations played a key role in the definition and prioritization of 
the current Safety Upgrades plan.
    The ASAP was established by Congress in the aftermath of the fatal 
Apollo1 fire in 1967 and provides NASA with an annual report outlining 
any findings and recommendations for improvements regarding its 
programs. In its latest annual report submitted last February, ASAP 
submitted important comments on Space Shuttle safety upgrades and 
infrastructure. Just last month, ASAP provided to OSF the results of 
the overall impact to Space Shuttle safety if Orbiter Maintenance 
Modifications (OMMs) are delayed until FY 2005 and 2006, and orbiter 
structural inspections (SIs) are retained at KSC, for orbiters 
Discovery and Endeavour.
    In the last twelve months, SFAC, an internal committee of the NASA 
Advisory Council, has provided quarterly assessments of the Space 
Shuttle Program and upgrades. This past June, SFAC recommended to NASA 
that the Electric Auxiliary Power Unit (EAPU) upgrade project be 
redesignated as a technology project. The primary reasons given were 
because the EAPU technology was not mature enough, project costs were 
increasing, and schedule slips were beginning to occur. NASA thanks 
these organizations for their valuable input and will continue to rely 
on them for various Space Shuttle upgrades assessments in the future.
    Addendum 3 summarizes the results of the independent assessments.
SSP FY 2002 Cost Issues and Mitigation Strategy
    During preliminary FY 2003 budget development this Spring, 
increased costs to FY 2002 baseline requirements were identified 
totaling as much as $218 million. This projected cost increase is due 
to the following:

    1. Content changes and growth.
          Orbiter OMM phasing/re-estimate
          Space Shuttle main engine (SSME) alternate turbopump 
        development support
          SSME minor components
          Orbiter operations support

    2. Contractor rate increases that factored in normal inflationary 
labor cost growth, higher fringe benefits (driven by higher medical 
costs) and other non-labor escalation. Contractor rate increases have 
always been projected to grow at 4-5 percent per year vs. 3.5 percent 
assumed.

    3. Core skills and business base erosion, particularly within the 
rocket propulsion sector of the aerospace industry.

    4. Supportability/Obsolescence issues.

    5. Recent price increases in natural gas and electricity are 
projected to continue. These increases are not limited to the aerospace 
sector nor to prime contractors but include industries nationwide.

    NASA Headquarters has partnered with the SSP project offices and 
SFAC on a strategy to maintain safety while mitigating the identified 
cost challenge. In order to maintain a healthy content in the Safety 
Upgrades plan, the following upgrade initiatives have been retained in 
the FY 2002 budget to Congress:

    1. CAU Increment I, this was just approved as a project last 
month.

    2. AHMS Phase I

    3. ET Friction Stir Weld

    4. New Main Landing Gear Tires Study

    5. Industrial Engineering for Safety

    6. Program Integration/Studies

    In addition to eliminating Program reserves, delaying 
infrastructure revitalization support, and the reductions due to the 
re-designation of the EAPU, OSF is in the process of analyzing budget 
decisions dealing with the following Upgrades-related initiatives for 
possible cancellation or deferral.

    1. Advanced Health Management System (AHMS) Phase II for the SSME

    2. SRB Thrust Vector Control (TVC)

    3. RSRM Propellant Grain Geometry

    4. Industrial Engineering for safety

    5. Orbiter Maintenance Down Period (OMDP) timing and location
Safety and The Space Shuttle Work Force
    At the end of FY 1999, OSF undertook an assessment of its staffing 
requirements at the field centers. While maintaining Space Shuttle 
safety as our highest priority, OSF began an intense phase of building, 
integrating and testing significant ISS flight elements. We were also 
continuing ISS Operations while planning to integrate assembly and 
logistics flights to the ISS. During this time we began development of 
High Priority Safety Upgrades to the Space Shuttle fleet.
    Given this workload environment, our internal assessment of core 
civil service workforce requirements at four Space Flight Centers 
convinced us that full-time equivalent (FTE) targets would have to be 
adjusted upwards. In late December 1999, each Center was directed to 
address critical workforce shortfalls in the SSP, ISS, and Advanced 
Space Transportation Programs. With respect to the Space Shuttle 
Program, the objective was to hire employees to support the increased 
flight rate and the Space Shuttle Upgrades program. Since January 2000, 
we have seen our Space Shuttle FTE levels grow from a FY 1999 base of 
1819 to a planned FY 2001 level of 1968 FTEs.
    Our new hires have addressed our need for additional support in the 
areas of Flight and Ground Operations, hardware, and software design. 
In addition, the new hires have also contributed to our ability to 
develop and train flight engineers for future flight operations 
activities. Beyond the new hires, we also transferred personnel from 
existing Center organizations to support on-going Shuttle Program 
requirements. As we move forward in maintaining our Space Shuttle 
flight rate and complete the construction of the International Space 
Station, our recent hires will increase our ability to safely and meet 
our program commitments.
    The ``Safety Culture'' within our Human Space Flight program is 
robust and healthy. It is a culture that is led from the front--
management demonstrates its commitment to safety by listening and 
rewarding, and by being willing to accept impacts to schedule in the 
interest of safety. Every single Space Shuttle employee is empowered to 
call a ``time out'' if they believe that there may be a potential 
threat to safety.
    There is concern about the uncertainty facing the workforce towards 
the end of this decade, should a next generation RLV be ready to begin 
a transition with the Shuttle. NASA is very sensitive to the need to 
preserve a work environment that emphasizes safety, and is beginning to 
think about transition issues at a very early stage so that we can 
ensure safe operations through any transition. In addition, reducing 
the level and implementation frequency for upgrades could cause many of 
these experienced and uniquely skilled employees to seek aerospace job 
opportunities elsewhere. Replacing these workers could become very 
difficult. We will also have the same problem with vendors that provide 
the unique services and products NASA needs to maintain the flight 
elements. NASA will work with the Administration and the Congress to 
proactively address these issues and ensure that human space flight 
activities continue to have the level of safety needed.
Space Shuttle Upgrades Program and the Space Flight Operations Contract 

    The Space Flight Operations Contract (SFOC) is a cost-plus-award-
fee performance-based contract. NASA works closely with the contractor, 
United Space Alliance (USA), to ensure that the ``scope of work'' 
adequately covers all technical and management activities necessary to 
support all ground, flight, and orbiter services required for space 
flight operations. These activities also include management of approved 
Space Shuttle Upgrades projects and the requirements for Orbiter 
Modification Down Periods (OMDPs), which are necessary to implement 
Orbiter Maintenance Modifications (OMMs) and Orbiter Structural 
Inspections (OSIs). Revisions to the SFOC are negotiated based on 
additions or deletions to the scope of work. The current SFOC contract 
expires in 2002, but we have two, non-priced two-year options and are 
in the process of starting the negotiations to exercise the first 
option.
    Given NASA's cost issues as described in my previous remarks, NASA 
Headquarters, JSC, KSC, and United Space Alliance have commenced 
activities to develop long-range facility and staffing plans for OMDP 
activities. With this plan, NASA will be able to better ascertain what 
critical resources are required to keep the high priority safety 
upgrades on schedule. The plan will address the requirements for 
retention of critical skills in the Shuttle workforce to accomplish the 
necessary upgrades and sustaining engineering work.

Space Shuttle Upgrades Program and Assembly of the International Space 
        Station
    Improving Space Shuttle safety and reliability to support ISS 
assembly operations and utilization for at least the next decade is 
currently a top priority for NASA. While we may be able to alleviate 
the short-term SSP cost challenges by delaying OMMs and OSIs, this may 
also increase the long-term risk for the SSP and could impact the 
current schedule of assembly flights for ISS. Addendum 4 illustrates 
that NASA's ability to maintain the SSP is facing increasing cost 
challenges.
    At projected funding levels we are confident that we will be able 
to maintain a flight rate of six flights per year until FY 2003. Beyond 
that point, unless cost challenges are met, the Space Shuttle may not 
be able to sustain the projected flight rate, seriously impacting the 
ISS assembly and operations (Addendum 4, Part II).

Space Shuttle Upgrades Program and the Integrated Space Transportation 
        Plan
    The President's FY 2002 Budget Blueprint reaffirms NASA's 
commitment to work with the aerospace industry to explore new space 
transportation systems that will dramatically increase safety and 
reliability, and reduce costs. NASA's Integrated Space Transportation 
Plan (ISTP) is the long-range investment strategy for the Government to 
accomplish its mission objectives by enabling its partners to develop a 
new, commercially-viable, reusable space transportation architecture, 
focused on NASA's priority needs.
    The ISTP consists of the Space Shuttle Program, the Space Launch 
Initiative (SLI) also known as the 2nd Generation RLV Program and the 
Advanced Space Transportation Program (3rd Generation research and in-
space transportation technology). Under the plan, the Space Shuttle 
will be maintained through investment in the safety upgrades. The Space 
Launch Initiative formulates and implements risk reduction activities 
and technologies to enable development of a 2nd Generation Reusable 
Launch Vehicle. Addendum 5 illustrates the ISTP concept.
    The follow-on RLV to the Space Shuttle will be operating from the 
subsonic (Mach < 1) to the hypersonic range (Mach > 5) of the high-
speed envelope. Currently, the Space Shuttle orbiter is the only 
reusable operational vehicle in the world that flies in the hypersonic 
regime. With 106 Space Shuttle flights completed, NASA has accumulated 
a total of 50-60 hours (ascent-descent) of hypersonic flight over 
twenty years. The Space Shuttle could play a valuable role in assisting 
SLI to evaluate promising 2nd RLV technologies if SLI provides the 
necessary funding for ground and/or flight tests during one or more 
Space Shuttle missions. An orbiter outfitted with SLI technology 
demonstrations for flight software, computers, internal vehicle health 
management system, and non-hazardous fluids could significantly reduce 
the development time and financial resources needed to flight-test 
these prototype systems. By acting as a technology pathfinder, SSP will 
be supporting SLI management and technical processes, to efficiently 
and accurately accumulate and analyze data that will improve/influence 
the various RLV concepts and designs. This type of effort would 
certainly minimize the operational transition problems from the SSP to 
an operational 2nd Generation RLV.
    The two programs are working together to bring the Space Shuttle 
heritage and lessons learned to the SLI concepts and evaluating the 
benefit of key technologies. The large majority of technologies being 
pursued in SLI is relevant to the Space Shuttle and can be evaluated 
using the Space Shuttle as a reference point. The Space Shuttle and SLI 
programs are also investigating other areas of collaboration and 
synergy.
    The following list summarizes some of the design features that the 
SSP could help to influence for SLI:

    1. Number of toxic fluids

    2. System margins

    3. Number of systems with build-in-test (BIT) build-in-test 
equipment (BITE)

    4. Number of confined spaces on vehicles

    5. Hours for turnaround between launches

    6. Number of different propulsion systems

    7. Number of unique stages for flight and ground

    8. Number of active ground systems required for servicing

    Current plans call for the Space Shuttle to be maintained until the 
2nd Generation RLV can achieve ``Initial Operating Capability'' (IOC). 
That milestone is projected to be the start of FY 2012. Under the ISTP, 
the transition from the Space Shuttle to the new vehicle could begin as 
early as FY 2009 and be completed by the end of FY 2011.
Concluding Remarks
    Mr. Chairman, safety continues to be our top priority. The American 
taxpayers have every right to expect the Space Shuttle program they pay 
for to operate safely and efficiently. However, our ability to continue 
to perform to the highest safety standards in the long-term will 
require that we continue to address the critical needs of an aging 
Apollo era infrastructure.
    Safety, maintainability and obsolescence issues will need 
continuing attention to ensure that the needs of our nation's Human 
Space Flight program can be met while next generation RLV technology is 
being developed. Safety investments must continue in order to ensure a 
safe program for as long as we are asked to fly.
    Mr. Chairman, this concludes my remarks for the record. I would be 
happy to answer any questions you may have. Thank you very much for 
your attention.

    Senator Wyden. Very good. Mr. McCulley.

 STATEMENT OF MICHAEL JAMES McCULLEY, CHIEF OPERATING OFFICER, 
                     UNITED SPACE ALLIANCE

    Mr. McCulley. Chairman Wyden, Senator Allen, Senator 
Nelson, if I had a tape recorder, perhaps you could just punch 
Mr. Nelson's, put it on replay and run it, and then I would not 
have to say much.
    I am Mike McCulley, Chief Operating Officer of United Space 
Alliance, which I will refer to as USA in the future, and we 
are responsible, as NASA's prime contractor, for the day-to-day 
operations of the Space Shuttle.
    Our mission is safe operation of the Shuttle, our No. 1 
mission. We plan flights, train astronauts, prepare all the 
hardware and software for launch, mission, landing of the Space 
Shuttle. As Senator Nelson mentioned, I am very proud of the 
fact that in the last 11 months we have had 8 highly successful 
missions, a flight rate of around 9 a year. Six of those went 
on-time the first time on 5-minute windows, one of them was 
delayed for weather, and one of them was delayed for an 
infrastructure issue for a couple of days.
    We have done an outstanding job, as Mr. Readdy said, of 
continuing safe operations while reducing cost. When I left the 
Astronaut Corps in 1990, if I had known that today I was going 
to be an expert in how to execute lay-offs, I might have taken 
a different job. I am unfortunately an expert on the Warn Act, 
the Fair Labor Standards Act, the Service Contract Act, and how 
to get through these things, and whether you do them 
performance-based or seniority-based, but I have done enough of 
it.
    At the time NASA and USA signed the space flight operations 
contract, the next generation RLV was expected to replace the 
Shuttle in 2004 or thereabouts. Of course, that resulted in 
nobody being interested in infrastructure upgrades or safety 
upgrades, and as Mr. Readdy said, and as Mr. Nelson said, we 
are still sitting there looking at those type of budgets today.
    But now we are being asked to fly for at least another 
decade, safely, efficiently, and in order to do that we have 
got to do something different than this flat budget we are 
looking at.
    At the direction of Congress in 2001, we were provided 
additional funding to initiate the safety upgrades, and NASA 
and its contractors, many of us, have been working very, very 
hard on a systematic approach to prioritize and work those 
upgrades. These upgrades would take the probability of a 
catastrophic failure during ascent from one in 483, as 
previously been mentioned, to around 1 in 1,000, or a 50-
percent, half reduction in that risk, but now those high 
priority safety upgrades have become discretionary funding.
    We believe that the proposed cancellations, or deferral of 
key spatial upgrades, are due to shortfalls in available 
budgets and not due to the project's lack of contribution to 
that safety improvement. USA believes that the NASA policy 
should be to dedicate the entire amount of funds provided by 
Congress for safety upgrades to the highest priority 
initiatives. If technological challenges make it impossible to 
move aggressively on one project, then we should revise the 
timetable for implementation or redirect to the next, rather 
than reprogram for other purposes.
    We have mentioned the infrastructure. The ground facilities 
are essential. It is a tough environment for KSC. We have 
similar problems in Mississippi, in Alabama, and in Texas. You 
have to take care of these things, and we have not done as good 
a job in the past few years, in my 10 years in the management 
side of this, as we should have.
    The hands-on work force, technicians, inspectors, and 
engineers is at the lowest level ever and yet, as we said 
earlier, we completed essentially a nine flight rate a year 
schedule in the last 11 months with near perfect vehicles, near 
perfect software, and near perfect performance on the part of 
the ground crews, flight controllers, and the astronauts.
    This work force number has stabilized over the past 2 
years. Morale is high. We have actually had some new hires, 
some fresh outs, or seed corn, as I call them, and they are 
excited. They like to be part of this program. But we need to 
be ever watchful that these folks are protected and augmented 
where necessary. They have very unique skills. For example, 
nobody in the world knows how to do proximity ops and 
rendezvous in space, except some of our folks. We helped DARPA, 
for example, in a program that they have got, because there is 
nobody else to do that, and we need to protect those skills.
    In summary, I have had the incredible opportunity for the 
last 17 years to work on this program. I have had, depending on 
how you count, eight different jobs, from astronaut, to weather 
pilot, to deputy program manager, and now the chief operating 
officer of this fine company. We have made remarkable success 
in budget, in quality, in predictability of schedules. I am an 
optimist. My wife says I am an optimist to a fault, that I hide 
my head when the bad things come, but I will tell you that I am 
more pessimistic today than I have been in the 17 years that I 
have been doing this, and I worked through those years in the 
nineties that Bill talked about, downsizing, looking for 
efficiencies with my eyes wide open, and taking little, small 
steps, because the ice is getting thinner under our feet as we 
move out toward the middle of this lake, but as I look at the 
budget that is laid out for the next 5 or 6 years, it is a very 
disturbing budget that has got me more pessimistic, as I said, 
than I have been in 17 years.
    Thank you, sirs, for having us.
    [The prepared statement of Mr. McCulley follows:]

Prepared Statement of Michael James McCulley, Chief Operating Officer, 
                         United Space Alliance

    Chairman Wyden, Senator Allen, Senator Nelson and Members of the 
Subcommittee: Thank you for the giving me the opportunity to testify 
before your Subcommittee on a subject that is very important to our 
nation--Space Shuttle safety.
    Good afternoon, I am Mike McCulley, Chief Operating Officer of the 
United Space Alliance (USA). USA is responsible for the day-to-day 
management of NASA's Shuttle fleet under a single prime contract, the 
Space Flight Operations Contract (SFOC), awarded by NASA in 1996. The 
company employs over 10,000 people, primarily in Texas and Florida. 
USA's mission is safe operation of the Shuttle and the International 
Space Station (ISS). We plan the flights, train the astronauts, and 
prepare all of the hardware and software for launch, mission, and 
landing of the Space Shuttle as well as support the ISS on orbit.
    Prior to joining USA, I managed the Lockheed Martin contract at 
Kennedy Space Center. I also had the opportunity to pilot the highly 
successful Galileo mission on STS-34 in 1989. I come before you today 
with seventeen years of experience on the Shuttle program. Working over 
80 Shuttle missions in 8 different jobs from weather pilot to astronaut 
to manager, I can state with certainty that the Shuttle program today 
is at the most robust and safest condition in its history.
    Together with NASA, the USA Team works continuously to reinforce 
the ``safety first'' culture of the Shuttle program. I am very proud 
that in the past eleven months, the Shuttle team successfully launched 
and landed 8 missions, which represents the highest flight rate in 
several years. Those flights have contributed to the establishment of a 
permanent outpost in low earth orbit.
    In order to continue supporting the nation's Human Space 
exploration goals, USA and NASA have implemented significant 
initiatives to further improve Shuttle operations as well as our 
performance. We have exceeded all of our industrial safety goals by 
substantial percentages and are performing significantly above the 
aerospace industry average. Having safely and successfully launched 29 
Shuttle missions since the inception of SFOC in 1996, USA gained 
invaluable experience and is now working closely with NASA to implement 
upgrades to the flight hardware, improve our processes and recommend 
improvements to ground facilities. However, in my opinion, our drive 
toward efficiency has moved us below sufficient funding for the many 
years of Shuttle operation ahead of us.
    Over the past decade, the Space Shuttle Program has done an 
outstanding job of continuing safe operations while reducing cost. 
Under the SFOC contract, USA and NASA have saved the American taxpayers 
$1.2B to date. USA has under-run the SFOC contract every year, and POP 
submissions to NASA reflect under-runs in GFY01 and GFY02. In addition 
to the savings realized under SFOC, NASA has reduced the Space Shuttle 
account by 40% since FY90. The Shuttle program succeeded in meeting 
reduced budget guidelines by achieving operational efficiencies, 
eliminating program reserves, and reducing its uncosted obligations to 
a level unacceptable for a program of this complexity. The budget 
limitations drove the Shuttle program to allow flight hardware upgrades 
and ground infrastructure projects to remain unfunded.
    As you may recall, at the time NASA signed the USA SFOC contract, 
the agency expected to phase in a Reusable Launch Vehicle (RLV) to 
ultimately replace the Shuttle fleet in 2004. As a result, NASA's 
management plans for Shuttle out-year budgets were greatly reduced, and 
plans for orbiter fleet and ground infrastructure improvements were 
very limited. Now, the Shuttle program is being asked to fly for many 
more years, yet the current and out-year budget profiles remain 
unchanged.
    USA believes that both the Congress and the American people support 
the continuation of the Federal Government's efforts to maintain human 
presence in space. If we are correct, the Space Shuttle Program is the 
link to all human space flight initiatives. The next generation launch 
vehicle is at least a decade away. The safety of our astronauts is 
paramount to USA and NASA, and it is obvious from the statements made 
on the Senate Floor by Members of this Committee, this objective is 
paramount to the Congress as well. USA strongly agrees with the 
emphasis of the Congress on the need to prioritize funding for the 
Shuttle program, in particular, the safety upgrades. Moreover, we 
believe that the long-term budget policy of the Federal Government 
should reflect a determination to refrain from reducing safety upgrade 
initiatives and ignoring ground infrastructure requirement. Prudent, 
timely and pre-planned modifications and upgrades of the Shuttle must 
be a national priority that transcends the budget limitations of any 
given year. Affordable upgrades are an essential investment in 
retaining the value of this indispensable national asset.
    Today, I have been asked to focus my remarks on safety upgrades, 
infrastructure and the Shuttle workforce.

Safety Upgrades
    The Space Shuttle is the foundation for our nation's continued 
human access to space in the 21st Century. It is uniquely capable of 
carrying humans into space while simultaneously providing the ability 
for heavy lift, rendezvous, docking, space walking, micro-gravity 
research, and new technology testing. These capabilities are unmatched 
elsewhere in the world.
    At the direction of Congress, in the FY01 budget, NASA was provided 
additional funding to initiate the High Priority Safety Upgrades 
Program. NASA and its industry team have embarked on a systematic 
approach to upgrading and maintaining the Shuttle system.
    Contrary to some perceptions, the Shuttle Upgrades program has done 
exactly what it was designed to do during project formulation: define 
requirements, establish project costs and schedules, and produce 
initial designs. I'd like to take this opportunity to provide the 
Committee with some information on the outstanding progress that has 
been made on these projects and the need for their continued 
development.
    New designs for Shuttle steering systems will eliminate the use of 
explosive and highly toxic hydrazine fuels. These new designs reduce 
hazards for both astronauts and ground crews. Complete integrated 
system prototypes of these designs, which could replace the current 
Auxiliary Power Units (APUs), have been built and tested. I am proud to 
say that this summer these prototypes have performed full mission 
simulations that meet and/or exceed current Shuttle capabilities on 
high fidelity test stands.
    The Orbiter APU prototype, known as the Electric APU (EAPU), would 
eliminate the single largest risk to Orbiter flight safety. The EAPU 
reduces the APU's contribution to Orbiter flight risk from 30% to less 
than 5%. This project has advanced the state-of-the-art for spacecraft 
batteries and demonstrated that they have more than enough energy for 
their intended usage. Electric motors and pumps have also been built 
and tested that can provide the hydraulic power necessary to move 
Shuttle main engine actuators and aerodynamic surfaces. With 
requirement definition complete and many technical issues solved, the 
project is ready to produce detailed and cost-efficient designs.
    The current APUs on the Solid Rocket Boosters use the same 
hazardous hydrazine fuel, and, similarly, represent a significant 
Shuttle safety risk. Multiple prototypes were created for this system, 
and each met mission requirements. A very simple, low-risk design was 
selected that uses safe helium gas in a blow-down configuration. The 
design not only has shown to be effective and efficient, but also has 
made use of composites technology from the X-34 program to reduce 
weight.
    We have seen significant progress in the formulation and definition 
of the Cockpit Avionics Upgrade (CAU) over the last year and a half. 
The CAU is an important safety upgrade to the Orbiter that will greatly 
improve the situational awareness of the crew and reduce their 
workload, particularly in unexpected and critical emergency situations.
    Prototyping activities for the CAU software and hardware have 
clearly proven the safety benefits of this upgrade as well as the major 
modification required to the heritage onboard computers. Display 
prototypes have been evaluated by flight crewmembers against 
established criteria and have improved the increased response and 
performance by the crew in life critical situations. A hardware 
prototype of the new direct access capability to the onboard computers 
has proven the ability for all parameters contained in those computers 
to be available for display to the crew, thereby further enhancing 
their ability to have full control and reaction capability. Not only do 
these prototypes demonstrate the feasibility of key architectural 
components of CAU, they also reduce the risk associated with the 
development of the system.
    Designs for the Advanced Health Monitoring System (AHMS) for the 
Space Shuttle Main Engines continue to achieve greater definition, and 
a prototype is planned for a ground experiment in spring 2002. New 
engine controllers, new software and added computer power will ``see'' 
trouble coming a split second before it can do harm, thus allowing 
either a safe engine shut down or commanding a reduced utilization of 
the engine thereby increasing landing and/or orbit options.
    A number of smaller improvements also add significantly to overall 
Shuttle safety. A new tire has been tested that will support higher 
landing speeds and provide greater safety margins. Likewise, new 
welding technology has been developed that can increase weld strength 
and fracture toughness on the External Tank. Finally, a modification to 
the Orbiter's radiators and wing leading edges that substantially 
reduces their susceptibility to orbital debris penetrations has nearly 
been completed across the Shuttle fleet.
    There are other product-improvement efforts that can further 
enhance the safety and operability of the Space Shuttle, particularly 
if it is to fly for an additional 10 years or more. Delaying the 
implementation of these improvements will expose flight crews to higher 
levels of risk for longer than necessary.
    Also under consideration is the slippage of scheduled Orbiter Major 
Modifications [OMM's]. This slippage may initiate a damaging trend, as 
budgets at NASA are not expected to improve. Delayed maintenance will 
delay incorporation of the upgrades creating detrimental fleet-wide 
implications. We prudently conduct scheduled OMM's, which we believe 
are essential to ensuring the integrity of the vehicle. On-schedule, 
fleet-wide modifications are necessary and prudent--consistency in 
configuration of the Orbiters is a must for training, safety, and 
reliability of operations.
    USA believes that proposed cancellations or reductions in the Space 
Shuttle upgrades budget are due to shortfalls in available NASA 
budgets, and are not the result of the projects' lack of contribution 
to overall Shuttle safety improvements. USA believes that NASA policy 
should be to dedicate the entire amount of funds provided by the 
Congress for safety upgrades to the highest priority Space Shuttle 
safety upgrades initiatives. If technological challenges make it 
impossible to move aggressively forward on one project, NASA should 
revise its timetable for implementation or redirect to the next 
project, rather than reprogramming the funds for other purposes.
    The continued, safe operation of the Space Shuttle is paramount 
until its replacement vehicle is in place.

Infrastructure
    Space Shuttle ground facilities are essential to safe and reliable 
operation of the Shuttle fleet. Crumbling equipment has already begun 
to adversely affect program performance and safety. Necessary upgrades 
to the infrastructure supporting the Shuttle program at the four Human 
Space Flight Centers (KSC, JSC, MFSC, SSC) can no longer be ignored.
    NASA's own Space Flight Advisory Committee (SFAC), a Subcommittee 
of the NASA Advisory Council, recently reported that the Shuttle might 
be operational for at least a decade beyond its originally predicted 
2012 lifetime. Two quotes from the 2000 SFAC Report are apropos at this 
point: ``For a system that will go well beyond the 2012 timeframe, 
attention must be given to this infrastructure. This should be a 
separate budget initiative''; and, ``Flight hardware upgrades alone 
won't keep Shuttles operating into the 2020's without ground upgrades 
also.''
    Unfortunately, for years the NASA budget has not included funding 
for critical Shuttle infrastructure projects. Infrastructure 
revitalization appears to have become the ``unwanted stepchild'' of the 
budget process. The need to address infrastructure is a well-documented 
issue and represents a glaring deficiency in the NASA budget. Eroding 
infrastructure is creating long-term issues of reliability and 
supportability. There have been incidents where eroding infrastructure 
has created serious safety concerns and launch delays. Some of the 
infrastructure impacts and concerns include:
    In the Launch Control Center (LCC), operators have had to change 
firing rooms for each of the last two launches because of computer 
interface failures.
    Within the last six months, the Vehicle Assembly Building (VAB) had 
to shut down during stacking because of antiquated load breaker 
switches, which have a potential to explode and burn.
    Although NASA has spent millions of dollars to crutch the crumbling 
8-acre VAB roof and corroded exterior paneling on the facility, 
paneling designed to withstand winds in excess of 100 mph, is being 
blown off the facility at winds of half the design load.
    The corrosive salt air environment of the Florida coast and launch 
plume impingement on the Shuttle launch pads result in a continuing 
battle against corrosion. Although the launch pads are periodically 
refurbished, the extensive amount of structure and operational activity 
restrictions has resulted in serious corrosion problems that need 
attention.
    There are also corrosion and obsolescence issues with respect to 
the crawler/transporters and the mobile launch platforms that have been 
in service since Apollo.
    Power, water, high-pressure gas, steam, and communications cabling 
distribution systems are suffering increasing failures due to age 
degradation and obsolescence. These basic utility distribution systems, 
at multiple operational locations, have outlived their design life.
    One-of-a-kind test equipment used for flight hardware repairs and 
spare parts production have been in service since the early 1970's and 
are not expected to last through the now-extended Shuttle program life.
    At JSC, outdated, unsupported computer systems operated by obsolete 
computer languages are performing critical flight software validation. 
In some cases, these systems are still loaded with punch cards.
    The Electrical Power Systems Laboratory (EPSL), a one-of-a-kind 
replica of the Space Shuttle Electrical Power Distribution and Control 
System, is over 20 years old. Trends indicate major maintenance costs 
in the near term unless major updates in test equipment, facilities, 
and maintenance of this unique Shuttle asset are made.
    At Stennis Space Center, propellant barges are in dire need of 
having their old mechanical and electrical systems replaced as well as 
having their hulls overhauled in dry dock. The barges operate in a 
harsh, corrosive atmosphere on a continuous basis. Barge overhaul has 
not occurred in over 15 years, yet, the Coast Guard recommends every 5 
years. Additionally, recent operating experience and inspection of the 
barges indicate a loss or compaction of vessel insulation.
    Large High Pressure Industrial Water (HPIW) Pumps that provide 
water for flame bucket cooling and deluge water to the Shuttle main 
engine test stands are in need of refurbishment. These pumps were 
installed at Stennis Space Center in the mid-1960's. The rotating 
elements of the pumps and gearboxes need to be replaced to assure 
reliable service.
    One half of annual maintenance budgets are spent band-aiding 
systems that are failing and then maintaining the band-aids, which 
becomes an additional maintenance burden. Expensive makeshift 
fabrications are a common occurrence as obsolescent spare parts and 
replacement units become harder and harder to acquire.
    We believe infrastructure improvements can wait no longer. The 
Federal Government must begin to budget annual funds to address NASA's 
prioritized list of infrastructure projects.

Shuttle Operations
    USA has become increasingly concerned that NASA will resort to 
reductions in the number of Shuttle flights as a stopgap method of 
accounting for anticipated shortfalls in its budget. Reduction of the 
number of Shuttle flights presents serious erosion in the capability of 
NASA to engage in human space flight activities. USA does not believe 
that a reduction in space flights is in the best interest of the 
nation. Moreover, such an approach fails to recognize the impact of 
flight rate on program costs.
    The Shuttle program's extraordinary achievement in operational 
efficiencies was driven by NASA's desire to help sustain the Shuttle 
program, thus assuring that the workhorse of the nation's Human Space 
Flight programs would be available to meet the full demands of research 
and human development of space. Reducing the number of flights as a 
budgetary tool wipes out years of developing these operating 
efficiencies. At some point, reduced activity eliminates operating 
efficiencies and results in unjustifiable increased operating costs on 
a per mission basis. A flight schedule of at least six flights per year 
must be maintained to sustain the efficiency of the Shuttle Program. 
Flight reductions also threaten to seriously erode and irreparably harm 
the entire Human Space Flight program. Reducing the flight schedule 
below six flights per year will force a delay in the pace of the Space 
Station assembly thereby driving further ISS cost growth as the 
assembly process stretches in time. A decision to limit Shuttle flights 
would also severely limit opportunities for space based scientific 
research, which remains a top priority for the Congress.

Shuttle Workforce
    The Shuttle workforce is at the lowest number of personnel it has 
ever been, and yet, through numerous efficiencies, it is achieving the 
aggressive goals of the Space Shuttle Program with the best record in 
its history of on-time launches (excluding weather, the last 6 missions 
launched without delays) and lowest number of in-flight anomalies (IFA) 
(averaged 20 IFAs in FY92 and steadily decreased to an average of 4 in 
FY00). The workforce total has stabilized over the past two years and 
morale is high. Even with the prospect of a lower flight rate, the 
demands on the workforce are increasing due to aging hardware, upgrades 
implementation, and normal lifecycle modifications. We need to be ever 
watchful that this very talented and dedicated workforce is protected 
and augmented when necessary. The experience of our management, 
engineering, and technician personnel will keep an aging Shuttle 
program at its highest level of efficiency. The dedication and skill of 
this workforce is the cornerstone of Shuttle safety.

Summary
    Mr. Chairman and Members of the Subcommittee, USA is proud to 
operate this unique and indispensable national asset. The Space Shuttle 
is a critical part of the nation's space infrastructure and must 
continue to fly safely for at least another decade, possibly longer. To 
ensure continued safe and efficient operation of the nation's Shuttle 
fleet, NASA and USA must pursue vehicle hardware, processing and ground 
facility improvements. Safety, maintainability and obsolescence issues 
must not be allowed to cripple the progress of our nation's Human Space 
Flight program while next generation systems are being developed. Given 
the likely lead times associated with the definition, funding and 
development of a new human-rated space vehicle, the Space Shuttle 
should be acknowledged and supported as the primary method for humans 
to reach the ISS throughout the Station's life.
    Over the past decade, the Space Shuttle program has done an 
outstanding job of continuing to fly the Shuttle safely and reliably 
while reducing costs. The Space Shuttle program is now under-funded. If 
we hope to continue our world leadership role in human space flight, it 
is imperative that adequate funding be provided to keep the Shuttle 
flying safely and reliably, including specific funding for Shuttle 
upgrades and infrastructure revitalization.
    Thank you for this opportunity to testify before your Subcommittee. 
I will be happy to answer any questions you might have.

    Senator Wyden. Thank you very much for some very helpful 
testimony.
    Mr. Blomberg, I think you heard me address one of the 
comments you had made earlier, because I was particularly 
struck with this assessment you made that it is hard to know 
when you are getting close to the line. I did not read into the 
record at that time that you stated, apparently somewhat 
thankfully, that fortunately you did not have to get into the 
budget issues in the past.
    My guess is, that is going to have to change in the days 
ahead, because these calls are so difficult, so gut-wrenching, 
with respect to the choices we are making, but we are very 
pleased that there is an independent safety advisory group, and 
that you all are part of it, and why don't you go ahead.

   STATEMENT OF RICHARD D. BLOMBERG, CHAIR, AEROSPACE SAFETY 
            ADVISORY PANEL, AND PRESIDENT, DUNLOP & 
                        ASSOCIATES, INC.

    Mr. Blomberg. Thank you, Mr. Chairman, and distinguished 
Members of the Subcommittee. I am pleased to be here today to 
summarize the Aerospace Safety Advisory Panel's current view of 
Space Shuttle safety. Both NASA and its contractors are 
handling near-term Space Shuttle safety admirably. Our primary 
concern, therefore, relates to the long-term picture, which has 
seemingly deteriorated since we highlighted it in our last 
annual report, which was last February.
    The Space Shuttle cannot continue indefinitely at an 
acceptable level of risk unless appropriate steps are taken 
now. There are four areas that we on the panel believe are 
critical to long-term Space Shuttle safety, and many of them 
have been mentioned, but I think it is worth reiterating them. 
The first deals with flight system improvements to reduce the 
risks associated with the servicing and use of the flight 
hardware. Unfortunately, budgetary pressures have forced the 
Space Shuttle program to eliminate or defer many needed 
upgrades. The panel does not think this is prudent, because it 
means the system must continue to operate at a higher risk 
level than is necessary, resulting in a lost safety 
opportunity.
    Under present guidelines, upgrades must be funded at the 
expense of activities needed to continue flying safely in the 
present. No program should be forced into a position in which 
tradeoffs between current and future safety are required. 
Safety should be foremost forever.
    The panel cautions that now is not the time for significant 
cutbacks. At this stage in the life of a complex vehicle that 
will likely remain in service for several more decades, 
increased rather than diminished risk reduction efforts are 
necessary.
    Our second focal area relates to the renewal of the ground 
infrastructure, and we include in that facilities, ground 
support equipment, and test and checkout gear, not just the 
buildings. These assets, like the vehicle itself, are aging. 
Much maintenance and improvement of this infrastructure has 
been deferred to conserve resources for operations. As a 
result, there is a large backlog of restoration and upgrade 
work. If needed efforts are delayed further, it may become 
impossible to catch up.
    Aging infrastructure becomes unreliable. Safety can be 
compromised when systems fail at inopportune times or multiple 
simultaneous failures occur, and the risk of this goes up as 
infrastructure ages.
    The third area requiring attention is logistics. An aging 
flight vehicle faces logistics challenges not only from wear 
and tear, but also from obsolescence. Some suppliers lose 
skills when they stop production. Others go out of business, or 
lose interest in maintaining capabilities when relegated to a 
minor support role.
    Space Shuttle logistics are hampered by a lack of 
sufficient assets to support the program for its likely service 
life. Where total inventory is adequate, flight-ready spares 
are still often less than desirable, because of slow repair 
turn-around times. NASA must analyze its logistics needs for 
the entire projected life of the Space Shuttle, and adopt a 
realistic program for acquiring and supporting sufficient 
numbers of suitable components and maintaining a key supplier 
base. Acquisitions must be made soon because of the long lead 
times for some complex, safety-critical Space Shuttle 
components.
    The final area I would like to highlight deals with work 
force. NASA and its contractors are inexorably losing 
experienced workers to retirement. Previous downsizing and 
hiring freezes that have already been mentioned have limited 
the available numbers of fully qualified successors. This 
projected loss of experience need not be detrimental to future 
safety if current planning is adequate to present the next 
generation of Space Shuttle managers with reasonable tasks. The 
knowledge and experience of current personnel must be captured 
and transferred to the future work force if safety and 
efficiency are to be maximized.
    In summary, in order to fly safely until 2020 and beyond, 
and we firmly believe that this vehicle will be the human space 
flight vehicle for this nation during that period, the Space 
Shuttle will need improvements, additional care, infrastructure 
revitalization, better logistics, a skilled and experienced 
work force, and development of an operational posture 
consistent with the capabilities of that work force. The longer 
that these vital steps are postponed, the harder they will be 
to accomplish, the more they will cost, and the higher will be 
the safety risk.
    The preferred alternative is to acknowledge now the role of 
the Space Shuttle as our human space flight vehicle for the 
foreseeable future, and to care for the total system 
appropriately in a timely manner.
    As Senator Wyden quoted, the boundary between safe and 
unsafe operations can never be well-defined. As equipment and 
facilities age, and work force experience is lost, the 
likelihood that the line will be inadvertently crossed, even by 
well-meaning managers, increases. The best way to prevent 
problems is to be proactive and continuous with risk reduction 
efforts. The panel fears that the Space Shuttle program is not 
being allowed to do this, and in fact has been forced to forego 
appropriate long-term planning in order to maximize the safety 
of present operations. This is not a wise approach, and we hope 
it will not continue.
    I thank you for this opportunity to present the thoughts of 
the Aerospace Safety Advisory Panel, and I stand ready to 
answer any questions you might have.
    [The prepared statement of Mr. Blomberg follows:]

  Prepared Statement of Richard D. Blomberg, Chair, Aerospace Safety 
        Advisory Panel, and President, Dunlop & Associates, Inc.

Mr. Chairman and Distinguished Members of the Subcommittee:

    I am pleased to appear before you today to summarize the Aerospace 
Safety Advisory Panel's current position on issues relevant to the 
safety of the Space Shuttle. The Subcommittee's focus on both the 
short-term and the post-2012 era is particularly germane. The Panel has 
focused much recent attention on the clear dichotomy between future 
Space Shuttle risk levels and the extent of current planning and 
investment directed at operating an aging space vehicle for the 
foreseeable future--to 2020 and beyond. Our most recent Annual Report 
delivered to the NASA Administrator last February highlighted the 
issues. We noted that efforts of NASA and its contractors were being 
primarily addressed to the immediate safety needs of the Space Shuttle. 
Little effort was being expended on the long-term safe use of the 
system. The overarching theme of our report, therefore, was the need 
for NASA, the Administration and the Congress to use a longer, more 
realistic planning horizon when making decisions with respect to the 
Space Shuttle.
    In the months since last year's report was prepared, the long-term 
situation has deteriorated. Budget constraints imposed on NASA's human 
spaceflight programs have forced the Space Shuttle program to adopt an 
even shorter planning horizon in order to continue flying safely. As a 
result, more items that should be addressed now are being deferred. 
This adds to the backlog of restorations and upgrades required for 
safety and continued efficient operations and postpones many risk 
reduction benefits. The resulting situation is suboptimal at best and 
gives the Panel cause for significant long-term concern. NASA needs a 
reliable human rated space vehicle to reap the full benefits of the 
International Space Station (ISS), and the Panel believes that, with 
adequate planning and investment, that vehicle can be the Space 
Shuttle.
    Before addressing our concerns, it is important to stress that the 
Panel does not believe that safety has been compromised at present. 
NASA and its contractors maintain an excellent level of safety 
consciousness, and this has contributed to significant flight 
achievements. The defined requirements for flying at an acceptable 
level of risk are always met. Increasingly, though, these requirements 
can only be achieved through the innovative and tireless efforts of an 
experienced workforce. As hardware wears out and veterans retire, the 
program will inevitably lose some of this compensatory ability. The 
options will then be to accept increased risk or to ground the fleet 
until time-consuming improvements and repairs can be accomplished. 
Neither of these is an acceptable option when there are clearly defined 
paths to reduce risk and increase operational reliability in the 
future.
    The Panel believes that four areas are critical to the long-term 
safe operation of the Space Shuttle:

   Flight system improvements--Reducing the risks associated 
        with the servicing and use of flight hardware and compensating 
        for obsolescence and wear.

   Renewal of the ground infrastructure--Ensuring that the 
        facilities, ground support equipment and test and checkout gear 
        used with the Space Shuttle are fully capable and supportive of 
        operations at the lowest possible risk.

   ogistics--Providing for the timely availability of properly 
        functioning components throughout the projected life of the 
        Space Shuttle.

   Workforce--Providing for the continuing availability of 
        critical skills and the retention of experienced personnel.

Flight System Improvements
    The Space Shuttle is not unique as an aging aerospace vehicle that 
still possesses substantial flight potential and has yet to be 
superseded by significant new technology. Any replacement for the Space 
Shuttle started now would likely take a decade or more to be designed, 
built and certified and likely would not be materially more capable 
than the current system with appropriate updates. Commercial airlines 
and the military have faced the same situation and have implemented 
timely product improvement programs for older aircraft to provide many 
additional years of safe, capable and cost effective service.
    The Space Shuttle program is not presently able to follow this 
proven approach. Responding to budgetary pressures has forced the 
program to eliminate or defer many already planned and engineered 
improvements. Some of these would directly reduce flight risk. Others 
would improve operability or the launch reliability of the system and 
are therefore potentially related to safety. In addition to the obvious 
safety concerns related to loss of vehicle and crew, we view anything 
that might ground the Space Shuttle while the ISS is inhabited as 
unnecessarily increasing risk. The Panel also does not think it is 
prudent to delay ready to install safety upgrades and to continue to 
operate at a higher risk level than is necessary.
    An example of a potentially valuable improvement that has recently 
been dropped is the electric auxiliary power unit (EAPU). This upgrade 
can reduce risk both on the ground and in flight through the 
elimination of hydrazine and the high-speed turbo-machinery 
characteristic of the current auxiliary power unit (APU). It can also 
improve operability by doing away with the use of cumbersome Self 
Contained Atmospheric Protective Ensemble (SCAPE) suits and the need to 
clear the work area during many APU ground-processing steps. 
Development of an acceptable EAPU will require some battery technology 
advances and weight reduction efforts. If the Space Shuttle is to fly 
until 2020 and beyond, it would appear that an investment in this type 
of multi-pronged improvement would be well justified. Under present 
guidelines, however, the human spaceflight program would have to fund 
EAPU development and certification at the expense of activities needed 
to continue flying safely in the present. No program should be forced 
into a position in which tradeoffs between current and future safety 
are required. Total risk can only be minimized if managers are free to 
make decisions with full recognition of the entire expected life cycle 
of the system for which they are responsible.
    Also, if the Space Shuttle does not introduce the EAPU or another 
replacement, it must rely on the present hydrazine-powered APU for the 
life of the program. This will require focusing additional current 
attention on ensuring the long-term availability of APU components and 
maintaining the ability of the supplier to provide support.
    Other improvements to the orbiter and the other Space Shuttle 
elements are being delayed in order to accommodate current budget 
needs. This type of ``stretch out'' usually ends up costing a program 
significant additional funds in the long run. More importantly, when 
risk reduction efforts, such as the advanced health monitoring for the 
Space Shuttle Main Engines, Phase II of the Cockpit Avionics Upgrade, 
orbiter wire redundancy separation, the orbiter radiator isolation 
valve and the helium auxiliary power unit for the solid rocket 
boosters, are deferred, astronauts are needlessly exposed to current 
levels of flight risk for longer than necessary. This is a lost 
opportunity that is not offset by any real life cycle cost saving for 
the program.
    The Panel cautions that now is not the time for significant 
cutbacks. At this stage in the life of a complex vehicle that will 
likely remain in service for several more decades, increased rather 
than diminished risk reduction efforts are essential. NASA must focus 
on applying the best available technologies to increasing the safety of 
the total system.

Ground Infrastructure
    In order to fly safely, the Space Shuttle must be supported by a 
properly functioning ground infrastructure including facilities, ground 
support equipment and test and checkout gear. These assets, like the 
vehicle itself, are aging. Much maintenance and improvement of this 
infrastructure has already been deferred to conserve resources for 
operations. As a result, there is a large backlog of restoration and 
upgrade work. The sheer magnitude of this backlog means that it will 
take some time to bring the infrastructure back to an acceptable 
condition if the available numbers of trained and experienced managers 
and engineers are applied to the task and funding is available. 
Unfortunately, rather than improving, the situation becomes worse each 
year. If restoration continues to be delayed, it will reach a point at 
which it may be impossible to catch up.
    Aging infrastructure becomes unreliable. At best, this will be a 
costly nuisance when failures delay launches. At worst, safety can be 
compromised when systems fail at inopportune times or multiple, 
simultaneous failures occur. As individual system reliability goes 
down, the likelihood of conjoint failures typically increases. Often, 
these multiple malfunctions have safety implications when the 
individual failures of which they are composed do not. The Panel is 
particularly concerned about the infrastructure at the Kennedy Space 
Center. The data cables leading to the launch pads and the 
deteriorating roof and siding panels on the Vehicle Assembly Building 
are examples of weak spots that could blossom into full-fledged safety 
or operations issues.
    Much of the Space Shuttle ground infrastructure dates to the Apollo 
era or earlier. It will be needed for at least another 20 years of 
Space Shuttle operations. In order to keep these critical parts of the 
system safe and fully supportive of the overall program, NASA needs to 
revitalize them as expeditiously as possible. If the infrastructure is 
updated and kept viable, it can also be a legacy to any vehicle that 
supersedes the Space Shuttle.

Logistics
    A safe flight program needs a viable supply chain that ensures the 
availability of functionally appropriate and reliable spare parts. An 
aging flight vehicle faces logistics challenges not only from wear and 
tear but also from obsolescence. Suppliers often lose skills when they 
stop production. Some go out of business or lose interest in 
maintaining capabilities when relegated to a minor support role. 
Technological advances can also strain the logistics function when new, 
safer approaches to subsystems become available and must be phased in.
    Space Shuttle logistics, although handled admirably by NASA and its 
contractors, is hampered by a lack of assets. Simply, the program has 
inadequate spare parts for many key subsystems. The Ku-band antenna is 
an example of a component for which the available stock is simply not 
sufficient. Where total inventory is adequate, flight-ready spares are 
still often less than desirable because of slow repair turnaround 
times. The logistics problem facing the Space Shuttle program is 
exacerbated by the long lead times for the manufacture of many critical 
components. The program is keeping up with logistics needs at present, 
but as the vehicle and its systems continue to age, problems can be 
expected. The response to these types of problems is often 
cannibalization of components from one vehicle to another. When 
cannibalization is used as a routine response to parts shortages, 
safety can be compromised.
    Supportability is also a logistics concern. The nozzle for the 
Space Shuttle Main Engine (SSME) is one example. It retains its 
original design in which over 1,000 tubes for carrying coolant must be 
inserted by hand before they are brazed. This is a highly specialized 
task that is dependent on an eroding base of experienced contractor 
personnel. If the Space Shuttle is to fly safely for its entire 
anticipated life, attention must be focused now either on developing a 
new nozzle or on procuring a sufficient number of the existing nozzles 
to ensure the availability of safe components and the maintenance of 
the contractor's skill base.
    Overall, NASA must analyze its logistics needs for the entire 
projected life of the Space Shuttle and adopt a realistic program for 
acquiring and supporting sufficient numbers of suitable components.

Workforce
    Identifying and implementing essential vehicle, infrastructure and 
logistics improvements to the Space Shuttle system requires an 
appropriately trained, experienced and motivated workforce. Motivation 
does not seem to be an issue. When permitted, NASA and its contractors 
have been successful in recruiting some of the best and brightest 
engineers and technicians even at less than prevailing industry 
salaries. These individuals almost universally express a desire to work 
on the Space Shuttle and ISS because they represent inspiring and 
challenging opportunities. It is fair to say that when it comes to 
human spaceflight, the dream is still truly alive!
    A complex endeavor such as the Space Shuttle, however, requires an 
experienced as well as a skilled and motivated workforce. Even with 
extensive training, inexperienced engineers and technicians are more 
prone to errors and less likely to detect problems than their 
experienced counterparts. NASA and its contractors are inexorably 
losing experienced workers to retirement. The hiatus in new hires 
during the 1990's has created a gap in the distribution of experience. 
As a result the successors to current managers will be operating 
without the same level of first-hand experience as their predecessors.
    The projected loss of experience need not be detrimental to future 
safety if current planning is adequate to present the next generation 
of Space Shuttle managers with reasonable tasks. This can be 
accomplished by ensuring that they are given a vehicle that is upgraded 
to the maximum extent possible and fully ready to conduct its mission 
for a realistic service life. Allowing experienced personnel to plan 
and execute any needed upgrades before they retire will permit their 
successors to focus primarily on safe operations based on clearly 
defined requirements while they amass their own experience. It would 
also be advisable to capture as much of the knowledge of the existing 
workforce as possible so that it can be archived for use in the future.

Conclusion
    The minimum risk approach is clear. In order to fly safely until 
2020 and beyond, the Space Shuttle will need improvements, additional 
care, infrastructure revitalization, better logistics, a skilled and 
experienced workforce and development of an operational posture 
consistent with the capabilities of that workforce. The longer that 
these vital steps are postponed, the harder they will be to accomplish, 
the more they will cost and the higher will be the safety risk. The 
preferred alternative is to acknowledge now the role of the Space 
Shuttle as our human spaceflight vehicle for the foreseeable future and 
to care for the total system appropriately in a timely manner. This 
will give our astronauts a safer and more capable vehicle to operate 
and reduce life cycle cost.
    Safety is an intangible whose true value is only appreciated in its 
absence. The boundary between safe and unsafe operations can never be 
well defined. As a result, even the most well meaning managers may not 
know when they cross it. Nobody would deliberately jeopardize Space 
Shuttle safety. But, as equipment and facilities age and workforce 
experience is lost, the likelihood that the line will be inadvertently 
breached increases. The best way to prevent problems is to be proactive 
and continuous with risk reduction efforts. The Aerospace Safety 
Advisory Panel fears that the Space Shuttle program is not being 
allowed to do this and, in fact, has been forced to forego appropriate 
long-term planning in order to maximize the safety of present 
operations. This is not a prudent approach to an ongoing program, and 
we hope it will not continue. Long-term safety is best achieved by 
giving capable managers a realistic budget and permitting them to 
exercise reasonable engineering discretion. By analogy, we would all 
willingly fly today on an airline whose aging aircraft were as well 
cared for as the Space Shuttle. If, however, that airline had neglected 
preparations for the future as the Space Shuttle program has been 
forced to do, we would certainly not invest in its stock.
    Thank you for the opportunity to present the thoughts of the 
Aerospace Safety Advisory Panel on this important topic.

    Senator Wyden. Thank you, Mr. Blomberg. Mr. Li.

    STATEMENT OF ALLEN LI, DIRECTOR, ACQUISITION & SOURCING 
       MANAGEMENT TEAM, U.S. GOVERNMENT ACCOUNTING OFFICE

    Mr. Li. Thank you, Mr. Chairman, and at the risk of Senator 
Nelson thinking I am a bean-counter, my background is aerospace 
engineering, so I am not a bean-counter, so I hope I am on your 
good side here.
    Senator Nelson. But you are a good bean-counter.
    [Laughter.]
    Mr. Li. Mr. Chairman and Members of the Subcommittee, I am 
pleased to be here today to discuss work force and safety 
issues facing NASA's Space Shuttle program. As requested, I 
will highlight the key points in our prepared statement.
    Two years ago, the Shuttle program was at a critical 
juncture. Its work force had declined significantly since 1995, 
its flight rate was about to double to support assembling a 
space station, and costly safety upgrades were planned to 
enhance the Shuttle's safe operation until at least 2012.
    For the purposes of today's hearing, we updated our prior 
work to reflect where NASA is today. First, the work force 
issue. While NASA is making progress in rebuilding its Shuttle 
work force, many challenges still remain. NASA's current budget 
request projects an increase of more than 200 full-time 
equivalent staff through fiscal year 2002. During the past 1\1/
2\ years, NASA has added 191 new hires and 33 transfers to the 
Shuttle program. Agency officials told us that the new staff 
are being assigned in areas critical to Shuttle safety.
    NASA has also focused more attention on human capital 
management and its annual performance plan, by outlining an 
overall strategy to attract and retain a skilled work force. 
Even with these gains, however, challenges lie ahead. For 
example, because many of the additional staff are new hires, 
they will require extensive training, and they will need to be 
effectively integrated into the Shuttle program. Also, NASA 
still needs to fully staff areas critical to Shuttle safety, 
deal with critical losses to retirement in coming years, and 
most of all, sustain management attention to human capital 
reforms.
    As Senator Allen stated earlier, NASA's work force problems 
are not unique. Many agencies have also been contending with 
serious human capital shortfalls. This is why GAO recently 
added strategic human capital management to its list of federal 
programs and operations identified as high risk.
    Turning now to the issue of Shuttle upgrades, we see some 
progress. I believe that NASA's ability to implement safety 
upgrades in a timely manner is uncertain. On the positive side, 
NASA has started to define and develop some specific Shuttle 
upgrades. For example, requirements for the cockpit's avionics 
upgrade have been defined. Also, Phase I of the main engine 
advanced health monitoring system is in development.
    NASA officials at Johnson told us that staffing for the 
upgrade program is now adequate. According to these officials, 
Johnson has added about 70 people to the upgrade program, while 
Marshall has added about 60 people. We did not assess the 
quality or sufficiency of the added staff, but according to 
officials from the development office, the work force skill 
level has improved to the point where the program has a good 
skill base.
    On the down side, the agency is still assessing the full 
package of its plan improvements, and some projects have 
already encountered funding and scheduling problems. NASA has 
not yet fully defined plan upgrades. Studies on particular 
projects such as developing a crew escape system are not 
expected for sometime. Moreover, our previous concerns with the 
technical maturity and potential cost growth of particular 
projects have proven to be warranted.
    For example, implementation of the electric APU has been 
delayed indefinitely because of technical uncertainties and 
cost growth. Also, the estimated cost of the Phase II of the 
main engine advanced health monitoring system has almost 
doubled, and NASA has canceled the proposed development of a 
Block III main engine improvement because of technological 
costs and schedule uncertainties.
    Compounding these challenges is the uncertainty surrounding 
the long-term future of the Shuttle. NASA is attempting to 
develop alternatives to the Shuttle, but it is not yet clear 
what these alternatives will be, and when this will happen. I 
recently testified before the House Science Committee on NASA's 
Space Launch Initiative. This is a risk reduction effort 
enabling NASA and industry to make a decision in the 2006 
timeframe on whether to proceed with the full-scale development 
of a reusable launch vehicle, also known as an RLV. A future 
RLV is envisioned to significantly reduce the cost of sending 
payloads to space, and would be an alternative to the Shuttle.
    However, as illustrated by the difficulties NASA 
experienced with the X-33 RLV technology demonstrator, this is 
no easy task. Because an exact timeframe for the Shuttle's 
replacement cannot be determined at this time, Shuttle work 
force and upgrade issues will need to be considered without 
fully knowing how the program will evolve over the long run.
    In conclusion, Mr. Chairman, NASA has made a start at 
addressing serious work force problems that could undermine 
Shuttle safety. It has also begun undertaking the important 
task of making needed safety and supportability upgrades. 
Nevertheless, the challenges ahead are significant. NASA is 
operating in an environment of uncertainty as to when the 
Shuttle will be replaced, and is still contending with the 
effects of its downsizing effort. As such, it will be 
exceedingly important that NASA sustain its attention and 
commitment to making Shuttle operation as safe as possible.
    Mr. Chairman, this concludes my summary statement.
    [The prepared statement of Mr. Li follows:]

   Prepared Statement of Allen Li, Director, Acquisition & Sourcing 
           Management Team, U.S. Government Accounting Office
Mr. Chairman and Members of the Subcommittee:

    I am pleased to be here today to discuss workforce and safety 
issues facing the National Aeronautics and Space Administration's 
(NASA) Space Shuttle program. As requested for this hearing, we have 
updated the information we provided to this Subcommittee in a March 
2000 testimony and in an August 2000 report.\1\ At the time, the Space 
Shuttle program was at a critical juncture: its workforce had declined 
significantly since 1995, its flight rate was to double over that of 
recent years to support the assembly of the International Space 
Station, and costly safety upgrades were planned to enhance the Space 
Shuttle's safe operation until at least 2012.
---------------------------------------------------------------------------
    \1\ See Space Shuttle: Human Capital Challenges Require Management 
Attention (GAO/T-NSIAD-00-133, Mar. 22, 2000) and Space Shuttle: Human 
Capital and Safety Upgrade Challenges Require Continued Attention (GAO/
NSIAD/GGD-00-186, Aug. 15, 2000).
---------------------------------------------------------------------------
    We reported that workforce reductions were jeopardizing NASA's 
ability to safely support the Shuttle's planned flight rate. For 
instance, many areas critical to safety were not sufficiently staffed 
by qualified workers. Recognizing the need to revitalize the Shuttle's 
workforce, NASA terminated its downsizing plans for the Shuttle program 
in December 1999 and initiated efforts to hire new staff. Furthermore, 
we also reported that NASA faced a number of programmatic and technical 
challenges in its efforts to develop and begin equipping the Shuttle 
fleet with a variety of safety and supportability upgrades over the 
next 5 years. These included a demanding schedule and undefined design 
and workforce requirements.
    Today, I will discuss NASA's current progress in addressing these 
workforce and safety issues and the challenges still ahead. In brief, 
we found that NASA is making progress in revitalizing the Shuttle 
program's workforce. NASA's current budget request projects an increase 
of more than 200 full-time equivalent staff through fiscal year 2002. 
NASA has also focused more attention on human capital management in its 
annual performance plan by outlining an overall strategy to attract and 
retain a skilled workforce. Even with these gains, however, there are 
still considerable challenges ahead. For example, because many of the 
additional staff are new hires, they will require considerable 
training, and they will need to be effectively integrated into the 
Shuttle program. Also, NASA still needs to fully staff areas critical 
to Shuttle safety; deal with critical losses due to retirements in the 
coming years; and, most of all, sustain management attention to human 
capital reforms. NASA's workforce problems are not unique. Many 
agencies have also been contending with serious human capital 
shortfalls. We recently added strategic human capital management to our 
list of federal programs and operations identified as high risk. 
Moreover, while NASA is making strides in revitalizing its workforce, 
its ability to implement safety upgrades in a timely manner is 
uncertain. NASA is still assessing the full package of its planned 
improvements, and some projects have already encountered funding and 
scheduling problems. Overcoming challenges related to the upgrades is 
critical since NASA will be relying on the Space Shuttle longer than 
originally anticipated.

Background
    The Space Shuttle is the world's first reusable space 
transportation system. It consists of a reusable orbiter with three 
main engines, two partially reusable solid rocket boosters, and an 
expendable external fuel tank. Since it is the nation's only launch 
system capable of carrying people to and from space, the Shuttle's 
viability is important to NASA's other space programs, such as the 
International Space Station. NASA operates four orbiters in the Shuttle 
fleet.
    Space systems are inherently risky because of the technology 
involved and the complexity of their activities. For example, thousands 
of people perform about 1.2 million separate procedures to prepare a 
Shuttle for flight. NASA has emphasized that the top priority for the 
Shuttle program is safety.
    The Space Shuttle's workforce shrank from about 3,000 to about 
1,800 full-time equivalent employees from fiscal year 1995 through 
fiscal year 1999. A major element of this workforce reduction was the 
transfer of Shuttle launch preparation and maintenance responsibilities 
from the government and multiple contractors to a single private 
contractor. NASA believed that consolidating Shuttle operations under a 
single contract would allow it to reduce the number of engineers, 
technicians, and inspectors directly involved in the day-to-day 
oversight of Shuttle processing. However, the agency later concluded 
that these reductions caused shortages of required personnel to perform 
in-house activities and maintain adequate oversight of the contractor.
    Since the Shuttle's first flight in 1981, the Space Shuttle program 
has developed and incorporated many modifications to improve 
performance and safety. These include a super lightweight external 
tank, cockpit display enhancements, and main engine safety and 
reliability improvements. In 1994, NASA stopped approving additional 
upgrades, pending the potential replacement of the Shuttle with another 
reusable launch vehicle.
    NASA now believes that it will have to maintain the current Shuttle 
fleet until at least 2012, and possibly through 2020. Accordingly, it 
has established a development office to identify and prioritize 
upgrades to maintain and improve Shuttle operational safety.
Progress and Challenges in Revitalizing the Shuttle Workforce
    Last year, we reported that several internal studies showed that 
the Shuttle program's workforce had been negatively affected by 
downsizing.\2\ These studies concluded that the existing workforce was 
stretched thin to the point where many areas critical to Shuttle 
safety--such as mechanical engineering, computer systems, and software 
assurance engineering--were not sufficiently staffed by qualified 
workers. (Appendix I identifies all of the key areas that were facing 
staff shortages). Moreover, the workforce was showing signs of overwork 
and fatigue. For example, indicators on forfeited leave, absences from 
training courses, and stress-related employee assistance visits were 
all on the rise. Lastly, the program's demographic shape had changed 
dramatically. Throughout the Office of Space Flight, which includes the 
Shuttle program, there were more than twice as many workers over 60 
years old than under 30 years old. This condition clearly jeopardized 
the program's ability to hand off leadership roles to the next 
generation.
---------------------------------------------------------------------------
    \2\ Several workforce studies had been completed since 1996, 
including Independent Assessment of the Shuttle Processing Directorate 
Engineering and Management Processes, NASA Human Exploration and 
Development of Space Independent Assessment Office, (Nov. 4, 1999); 
Annual Report for 1999, Aerospace Safety Advisory Panel (Feb. 2000); 
and Report to Associate Administrator, Office of Space Flight, Space 
Shuttle Independent Assessment Team (Mar. 7, 2000).
---------------------------------------------------------------------------
    According to NASA's Associate Administrator for the Office of Space 
Flight, the agency faced significant safety and mission success risks 
because of workforce issues. This was reinforced by NASA's Aerospace 
Safety Advisory Panel, which concluded that workforce problems could 
potentially affect flight safety as the Shuttle launch rate increased.
    NASA subsequently recognized the need to revitalize its workforce 
and began taking actions toward this end. In October 1999, NASA's 
Administrator directed the agency's highest-level managers to consider 
ways to reduce workplace stress. The Administrator later announced the 
creation of a new office to increase the agency's emphasis on health 
and safety and included improved health monitoring as an objective in 
its fiscal year 2001 performance plan.\3\ Finally, in December 1999, 
NASA terminated its downsizing plans for the Shuttle program and 
initiated efforts to begin hiring new staff.
---------------------------------------------------------------------------
    \3\ The Government Performance and Results Act of 1993 requires 
agencies to prepare annual performance plans. The purpose is to improve 
the efficiency of all federal agencies, under the goals of improving 
management, effectiveness, and public accountability; improving 
congressional decision-making on where to commit the nation's fiscal 
and human resources; and improving citizens' confidence in the 
government's performance.
---------------------------------------------------------------------------
    Following the termination of its downsizing plans, NASA and the 
Office of Management and Budget conducted an overall workforce review 
to examine personnel needs, barriers to achieving proper staffing 
levels and skill mixes, and potential reforms to help address the 
agency's long-term requirements. In performing this review, NASA used 
GAO's human capital self-assessment checklist.\4\ The self-assessment 
framework provides a systematic approach for identifying and addressing 
human capital issues and allows agency managers to (1) quickly 
determine whether their approach to human capital supports their vision 
of who they are and what they want to accomplish and (2) identify those 
policies that are in particular need of attention. The checklist 
follows a five-part framework that includes strategic planning, 
organizational alignment, leadership, talent, and performance culture.
---------------------------------------------------------------------------
    \4\ See Human Capital: A Self-Assessment Checklist for Agency 
Leaders (GAO/OCG-00-14G, Sept. 2000).
---------------------------------------------------------------------------
Recent Actions Taken by NASA
    NASA has taken a number of actions this year to regenerate its 
Shuttle program workforce. Significantly, NASA's current budget request 
projects an increase of more than 200 full-time equivalent staff \5\ 
for the Shuttle program through fiscal year 2002--both new hires and 
staff transfers. According to NASA, from the beginning of fiscal year 
2000 through July 2001, the agency had actually added 191 new hires and 
33 transfers to the Shuttle program. These new staff are being assigned 
to areas critical to Shuttle safety--such as project engineering, 
aerospace vehicle design, avionics, and software--according to NASA. As 
noted earlier, appendix I provides a list of critical skills where NASA 
is addressing personnel shortages.
---------------------------------------------------------------------------
    \5\ Full-time equivalent is a measure of staff hours equal to those 
of an employee who works 40 hours per week in 1 year. Thus, a measure 
of 200 full-time equivalent staff does not necessarily represent the 
actual number of new hires.
---------------------------------------------------------------------------
    NASA is also focusing more attention on human capital management in 
its annual performance plan. The Government Performance and Results Act 
requires a performance plan that describes how an agency's goals and 
objectives are to be achieved. These plans are to include a description 
of the (1) operational processes, skills, and technology and (2) human, 
capital and information resources required to meet those goals and 
objectives. On June 9, 2000, the President directed the heads of all 
federal executive branch agencies to fully integrate human resources 
management into agency planning, budget, and mission evaluation 
processes and to clearly state specific human resources management 
goals and objectives in their strategic and annual performance plans.
    In its Fiscal Year 2002 Performance Plan, NASA describes plans to 
attract and retain a skilled workforce. The specifics include the 
following:

   Developing an initiative to enhance NASA's recruitment 
        capabilities, focusing on college graduates.

   Cultivating a continued pipeline of talent to meet future 
        science, math, and technology needs.

   Investing in technical training and career development.

   Supplementing the workforce with nonpermanent civil 
        servants, where it makes sense.

   Funding more university-level courses and providing training 
        in other core functional areas.

   Establishing a mentoring network for project managers.

    We will provide a more detailed assessment of the agency's progress 
in achieving its human capital goals as part of our review of NASA's 
Fiscal Year 2002 Performance Plan requested by Senator Fred Thompson.
    Alongside these initiatives, NASA is in the process of responding 
to a May 2001 directive from the Office of Management and Budget on 
workforce planning and restructuring.\6\ The directive requires 
executive agencies to determine (1) what skills are vital to 
accomplishing their missions, (2) how changes expected in the agency's 
work will affect human resources, (3) how skill imbalances are being 
addressed, (4) what challenges impede the agency's ability to recruit 
and retain high-quality staff, and (5) what barriers there are to 
restructuring the workforce. NASA officials told us that they have 
already made these assessments. The next step is to develop plans 
specific to the space flight centers that focus on recruitment, 
retention, training, and succession and career development.
---------------------------------------------------------------------------
    \6\ Workforce Planning and Restructuring, OMB Bulletin No. 01-07 
(May 8, 2001).
---------------------------------------------------------------------------
Remaining Workforce Challenges
    If effectively implemented, the actions that NASA has been taking 
to strengthen the Shuttle workforce should enable the agency to carry 
out its mission more safely. But there are considerable challenges 
ahead. For example, as noted by the Aerospace Safety Advisory Panel in 
its most recent annual report, NASA now has the difficult task of 
training new employees and integrating them into organizations that are 
highly pressured by the Shuttle's expanded flight rates associated with 
the International Space Station.\7\ As we stressed in our previous 
testimony, training alone may take as long as 2 years, while workload 
demands are higher than ever.
---------------------------------------------------------------------------
    \7\ See Annual Report for 2000, Aerospace Safety Advisory Panel.
---------------------------------------------------------------------------
    The panel also emphasized that (1) stress levels among some 
employees are still a matter of concern; (2) some critical areas, such 
as information technology and electrical/electronic engineering, are 
not yet fully staffed; and (3) NASA is still contending with the 
retirements of senior employees. Officials at Johnson Space Center also 
cited critical skill shortages as a continuing problem. Furthermore, 
NASA headquarters officials stated that the stress-related effects of 
the downsizing remain in the workforce. Addressing these particular 
challenges, according to the Aerospace Safety Advisory Panel, will 
require immediate actions, such as expanded training at the Centers, as 
well as a long-term workforce plan that will focus on retention, 
recruitment, training, and succession and career development needs.

Human Capital Shortfalls--A Governmentwide Problem
    The workforce problems we identified during our review are not 
unique to NASA. As our January 2001 Performance and Accountability 
Series reports made clear, serious federal human capital shortfalls are 
now eroding the ability of many federal agencies--and threatening the 
ability of others--to economically, efficiently, and effectively 
perform their missions.\8\ As the Comptroller General recently stated 
in testimony, the problem lies not with federal employees themselves, 
but with the lack of effective leadership and management, along with 
the lack of a strategic approach to marshaling, managing, and 
maintaining the human capital needed for government to discharge its 
responsibilities and deliver on its promises.\9\ To highlight the 
urgency of this governmentwide challenge, in January 2001, we added 
strategic human capital management to our list of federal programs and 
operations identified as high risk.\10\
---------------------------------------------------------------------------
    \8\ See Performance and Accountability Series--Major Management 
Challenges and Program Risks: A Governmentwide Perspective (GAO-01-241, 
Jan. 2001). In addition, see the accompanying 21 reports (numbered GAO-
01-242 through GAO-01-262) on specific agencies.
    \9\ See Human Capital: Taking Steps to Meet Current and Emerging 
Human Capital Challenges (GAO-01-965T, July 17, 2001).
    \10\ See High-Risk Series: An Update (GAO-01-263, Jan. 2001). In 
addition, see Human Capital: Meeting the Governmentwide High-Risk 
Challenge (GAO-01-357T, Feb. 1, 2001).
---------------------------------------------------------------------------
    Our work has found human capital challenges across the federal 
government in several key areas.

   First, high-performing organizations establish a clear set 
        of organizational intents--mission, vision, core values, goals 
        and objectives, and strategies--and then integrate their human 
        capital strategies to support these strategic and programmatic 
        goals. However, under downsizing, budgetary, and other 
        pressures, agencies have not consistently taken a strategic, 
        results-oriented approach to human capital planning.

   Second, agencies do not have the sustained commitment from 
        leaders and managers needed to implement reforms. Achieving 
        this can be difficult to achieve in the face of cultural 
        barriers to change and high levels of turnover among management 
        ranks.

   Third, agencies have difficulties replacing the loss of 
        skilled and experienced staff, and in some cases, filling 
        certain mission-critical occupations because of increasing 
        competition in the labor market.

   Fourth, agencies lack a crucial ingredient found in 
        successful organizations: organizational cultures that promote 
        high performance and accountability.

Progress and Challenges in Making Shuttle Safety Upgrades
    At this time last year, NASA planned to develop and begin equipping 
the Shuttle fleet with a variety of safety and supportability upgrades, 
at an estimated cost of $2.2 billion. These upgrades would affect every 
aspect of the Shuttle system, including the orbiter, external tank, 
main engine, and solid rocket booster.
    Last year, we reported that NASA faced a number of programmatic and 
technical challenges in making these upgrades.

   First, several upgrade projects had not been fully approved, 
        creating uncertainty within the program.

   Second, while NASA had begun to establish a dedicated 
        Shuttle safety upgrade workforce, it had not fully determined 
        its needs in this area.

   Third, the Shuttle program was subject to considerable 
        scheduling pressure, which introduced the risk of unexpected 
        cost increases, funding problems, and/or project delays. 
        Specifically, the planned safety upgrade program could require 
        developing and integrating at least nine major improvements in 
        5 years--possibly making it the most aggressive modification 
        effort ever undertaken by the Shuttle program. At the same 
        time, technical requirements for the program were not yet fully 
        defined, and upgrades were planned to coincide with the peak 
        assembly period of the International Space Station.

    Since then, NASA has made some progress but has only partially 
addressed the challenges we identified last year. Specifically, NASA 
has started to define and develop some specific Shuttle upgrades. For 
example, requirements for the cockpit avionics upgrade have been 
defined. Also, Phase I of the main engine advanced health monitoring 
system is in development, and Friction Stir Welding on the external 
tank is being implemented.
    In addition, according to Shuttle Development Office officials, 
staffing for the upgrade program is adequate. Since our last report, 
these officials told us that the Johnson Space Center has added about 
70 people to the upgrade program, while the Marshall Space Flight 
Center has added another 50 to 60 people. We did not assess the quality 
or sufficiency of the added staff, but according to the development 
office officials, the workforce's skill level has improved to the point 
where the program has a ``good'' skill base.
    Nevertheless, NASA has not yet fully defined its planned upgrades. 
The studies on particular projects, such as developing a crew escape 
system, are not expected to be done for some time. Moreover, our 
previous concerns with the technical maturity and potential cost growth 
of particular projects have proven to be warranted. For example, the 
implementation of the electric auxiliary power unit has been delayed 
indefinitely because of technical uncertainties and cost growth. Also, 
the estimated cost of Phase II of the main engine advanced health 
monitoring system has almost doubled, and NASA has canceled the 
proposed development of a Block III main engine improvement because of 
technological, cost, and schedule uncertainties.
    Compounding the challenges that NASA is facing in making its 
upgrades is the uncertainty surrounding its Shuttle program. NASA is 
attempting to develop alternatives to the Space Shuttle, but it is not 
yet clear what these alternatives will be. We recently testified before 
the Subcommittee on Space and Aeronautics, House Committee on Science 
on the agency's Space Launch Initiative. This is a risk reduction 
effort aimed at enabling NASA and industry to make a decision in the 
2006 time frame on whether the full-scale development of a reusable 
launch vehicle can be undertaken.\11\ However, as illustrated by the 
difficulties NASA experienced with another reusable launch vehicle 
demonstrator--the Lockheed Martin X-33--an exact time frame for the 
Space Shuttle's replacement cannot be determined at this time. 
Consequently, Shuttle workforce and upgrade issues will need to be 
considered without fully knowing how the program will evolve over the 
long run.
---------------------------------------------------------------------------
    \11\ See Space Transportation: Critical Areas NASA Needs to Address 
in Managing Its Reusable Launch Vehicle Program (GAO-01-826T, June 20, 
2001).
---------------------------------------------------------------------------
    In conclusion, NASA has made a start at addressing serious 
workforce problems that could undermine Space Shuttle safety. It has 
also begun undertaking the important task of making needed safety and 
supportability upgrades. Nevertheless, the challenges ahead are 
significant--particularly because NASA is operating in an environment 
of uncertainty and it is still contending with the effects of its 
downsizing effort. As such, it will be exceedingly important that NASA 
sustain its attention and commitment to making Space Shuttle operations 
as safe as possible.
    Mr. Chairman, this concludes my statement. I would be happy to 
answer any questions that you or Members of the Subcommittee may have.
Contact and Acknowledgement
    For further contact regarding this testimony, please contact Allen 
Li. Individuals making key contributions to this testimony included 
Jerry Herley, John Gilchrist, James Beard, Fred Felder, Vijay Barnabas, 
and Cristina Chaplain.

Appendix I: Space Shuttle Program Skill Shortfall Areas
    In December 1999, the National Aeronautics and Space Administration 
(NASA) completed an internal workforce assessment focusing on the 
Office of Space Flight, which includes the Shuttle program. That 
assessment identified work areas in which NASA was experiencing skill 
shortfalls. At our request, NASA provided a listing of skill shortages 
in the Shuttle program. The areas the agency identified follow:

   Program/project management/project engineering
   Aerospace vehicle design and mission analysis
   Avionics
   Guidance, navigation, and control systems
   Materials analysis
   Mechanical engineering
   Thermal control
   Structural dynamics
   Vehicle dynamics
   Aircraft ground systems
   Human factors
   Environmental controls
   Robotic systems
   Computer systems
   Fluids (liquid propulsion systems)
   Information technology security
   Aerospace systems test engineering
   Software (applications and systems)
   Sensors and transducers
   Electrical engineering
   Software assurance engineering
   Flight assurance
   Quality engineering
   Reliability engineering
   Safety engineering
   Flight controls

    Senator Wyden. All right. Let us move now to Mr. O'Connor.

STATEMENT OF BRYAN D. O'CONNOR, DIRECTOR, ENGINEERING DIVISION, 
                       FUTRON CORPORATION

    Mr. O'Connor. Mr. Chairman, Members of the Subcommittee, 
thank you very much for inviting me here to testify. My name is 
Bryan D. O'Connor, and I was the Chairman of the National 
Research Council's Committee on Space Shuttle Upgrades in 1998-
1999.
    Now, I know that goes back a little bit, but I think my 
purpose here today is to go back a little bit, about three 
years, and show you where we were with the upgrade situation 
back then, because that is what our committee was asked to do.
    During fiscal year 1997, NASA lifted the design freeze that 
they had established the prior year, and they authorized the 
Space Shuttle program to dedicate about $100 million of its 
reserves each year to a new upgrade program. This program 
funded relatively minor modifications intended to improve 
safety, support missions, reduce obsolescence, and reduce 
costs. It also supported studies of potential major upgrades.
    Implementation of any major upgrades, however, would 
necessarily be delayed until a high-level national decision 
scheduled for the end of the decade was made on whether to 
phase out the Shuttle by the year 2012, or to continue 
operating it indefinitely.
    At NASA's request, a committee of the National Research 
Council, the principal, operating arm of the National Academy, 
undertook an independent assessment of NASA's Space Shuttle 
upgrades program. Our committee looked at NASA's method for 
evaluating and selecting its upgrades. We also conducted a top-
level technical assessment of several of the proposed Shuttle 
upgrades that had not yet been implemented.
    The committee found that in spite of budget uncertainties 
at that time, and technical risks with the development of a 
Shuttle replacement, as well as existing national policy 
restrictions on the use of the Shuttle, NASA's approach 
appeared to be appropriate. The committee strongly supported 
their use of program goals, safety, schedule, supportability 
and cost to help prioritize these upgrades, and we suggested 25 
specific improvements to the decision support process that they 
were using at that time.
    Our committee believed that with a few improvements, a 
couple of the systems that they were using for decision support 
(one of which one of our panel members has mentioned here in 
terms of risk numbers, called the quantitative risk assessment 
system, and another one called decision support system) had the 
potential to be even more helpful aids and upgrade 
decisionmakers than they had been to that point.
    Since the committee's report was published, events have 
dictated that NASA look at the Shuttle for longer term while 
difficult technology and market issues are worked out for its 
eventual replacement. At the same time, fiscal challenges with 
NASA's Human Space Flight programs require continued 
selectivity and prudence with Shuttle upgrade choices. The 
latest probablistic risk assessments for the Shuttle show that, 
although upgrades since the Challenger accident have improved 
the risk posture of the vehicle, it still falls well short of 
the kind of overall safety level NASA has required of future 
human-rated vehicles in its Space Launch Initiative (SLI), and 
even further below that required of military transports, as you 
have heard.
    Considering the fundamental design and complexity of the 
Shuttle, it is my own personal opinion that no amount of money 
for upgrades will get it to those levels of reliability that we 
have as goals for that program. That does not mean we give up. 
While NASA works toward those worthy goals on SLI, they should 
continue looking with care at those affordable improvements to 
keep the Shuttle flying safely in an environment of component 
obsolescence. Moreover, it is equally important that they 
continue to pay very close attention to the people aspects of 
this complex system.
    This unique, human-crewed space vehicle, with its high-risk 
propulsion and hydraulic control systems, and its extremely 
limited escape system, requires nothing short of full attention 
100 percent of the time by the best 20,000-plus people that 
NASA and its contractors can field.
    Thank you.
    [The prepared statement of Mr. O'Connor follows:]

    Prepared Statement of Bryan D. O'Connor, Director, Engineering 
                      Division, Futron Corporation

    Mr. Chairman and members of the Subcommittee, thank you for 
inviting me here to testify. My name is Bryan D. O'Connor. I was 
Chairman of the National Research Council's Committee on Space Shuttle 
Upgrades in 1998/99, and I hold a regular position as Director, 
Engineering Division at Futron Corporation in Washington, DC. As you 
know, the National Research Council (NRC) is the operating arm of the 
National Academy of Sciences, National Academy of Engineering, and the 
Institute of Medicine, chartered by Congress in 1863 to advise the 
government on matters of science and technology.
    In May 1998, the National Aeronautics and Space Administration 
(NASA) asked the NRC to examine the agency's plan for further upgrades 
to the Space Shuttle system. The NRC was asked to assess NASA's method 
for evaluating and selecting upgrades and to conduct a top-level 
technical assessment of proposed upgrades. The committee finished its 
work in late 1998, and published its report in early 1999. NASA 
responded to the report in March 1999. The full report is available to 
the public through the National Academy Press. Attached to my written 
statement is the report's executive summary as well as NASA's written 
response.
    At the time of the committee's assessment, NASA was looking ahead 
to a decision by the end of the decade to either begin a phase out of 
the Shuttle system, or to extend its operations beyond 2012. With this 
major decision still ahead of them it was difficult for NASA to plan 
with confidence on major upgrades, so their main efforts were being 
spent on those near term improvements that would make sense no matter 
what the decision might be. Flight safety was, as usual, the highest 
priority, and our committee looked at the upgrade selection process 
with that in mind. With only a few minor exceptions, we found their 
process and decision support tools consistent with safety and the other 
NASA priorities of launch schedule dependability, supportability of the 
system's aging components, and operations efficiency. Although we made 
no specific recommendations as to implementation of the various upgrade 
options, we did offer 25 recommendations for improvements in the 
upgrade selection process, most of which were agreed to and enacted by 
NASA.
    Since the committee's report was published, events have dictated 
that NASA look at Shuttle for the long term while difficult technology 
and market issues are worked out for its eventual replacement. At the 
same time, fiscal challenges with NASA's human spaceflight programs 
require continued selectivity and prudence with Shuttle upgrade 
choices. The latest risk assessments for the Shuttle system show that 
changes since the Challenger accident have improved the risk posture of 
the vehicle by nearly an order of magnitude, but it still falls well 
short of the overall safety level NASA demands of future human rated 
vehicles. Considering the fundamental design and complexity of the 
Shuttle, it is my own personal opinion that no amount of money for 
upgrades will get it to the levels of reliability and operational cost 
that NASA has stated as its goals for the Space Launch Initiative 
(SLI). So, while the SLI works towards those worthy goals, NASA should 
continue looking with care at those affordable improvements that keep 
the Shuttle flying safely in an environment of component obsolescence. 
Moreover, it is equally important that they continue to pay close 
attention to the people aspects of such a complex system. This unique 
human-crewed space launch vehicle with its high risk propulsion and 
hydraulic control systems and extremely limited escape system will 
always need substantial hands on care and preparation between flights. 
It requires nothing short of full attention--100% of the time--by the 
best 20,000 people NASA and its contractors can field.

Attachments:

        Executive Summary--Upgrading the Space Shuttle
        NASA Response to the NRC Report on Space Shuttle Upgrades
                                 ______
                                 
             Executive Summary--Upgrading the Space Shuttle

    The Space Shuttle system has been modified many times since the 
first launch of Space Shuttle Columbia in 1981. During the 1980s, major 
upgrade programs were established to respond to problems and anomalies 
experienced during the initial flights and the Challenger accident. 
Additional upgrades were approved in the early 1990s to enable the 
Shuttle to visit the Mir space station and support the International 
Space Station. In 1996, however, the Shuttle program effectively ceased 
approving new changes to the Space Shuttle design to concentrate scarce 
resources on developing potential replacements for the Shuttle. The 
same year, the responsibility for some operational elements of the 
Space Shuttle Program were transferred to the United Space Alliance 
(USA) corporation.
    During fiscal year 1997, the National Aeronautics and Space 
Administration (NASA) lifted the ``design freeze'' and authorized the 
Space Shuttle Program to dedicate about $100 million of its reserves 
each year to a new upgrade program. This program funds relatively minor 
modifications intended to reduce obsolescence, support missions, 
improve safety, and reduce costs, as well as studies of potential major 
upgrades. Implementation of any major upgrades, however, will 
necessarily be held off until a high-level national decision scheduled 
for the end of the decade is made on whether to phase out the Shuttle 
by the year 2012 or to continue operating it indefinitely.
    Information on potential upgrades to the Shuttle is collected, 
organized, and prioritized by the Space Shuttle Program Development 
Office, which reports to the manager of the Space Shuttle Program. Each 
candidate upgrade is designated as Phase I, Phase II, Phase III, or 
Phase IV, depending on when it was approved and its anticipated cost 
and effect on the Space Shuttle design (see Table ES-I).


                                            Table ES-1 Upgrade Phases

  Phase                     Main Focus                         Typical Cost                    Status

I          Improving safety, supporting the             >$100 million               Either completed or will be
            International Space Station                                              by 2000

II         Combating obsolescence                       $10 to $50 million          Some underway; some in study
                                                                                     phase

III        Enhancing Shuttle capability (does not       $10s to $100s of millions   Studies only
            change the fundamental Shuttle
            configuration)

IV         Enhancing Shuttle capability (changes the    >$1 billion                 Studies only
            fundamental Shuttle configuration)



    In addition to the phased upgrades, the USA corporation has limited 
incentives to initiate and implement cost-saving upgrades.

                           Choosing Upgrades

    NASA uses its limited budget for Shuttle upgrades to fund minor 
upgrades with identifiable short-term benefits and to conduct 
preparatory studies for major upgrades that may be warranted if the 
Shuttle program is called upon to operate after 2012. In spite of 
budget uncertainties, technical risks with the development of a 
reusable launch vehicle (Shuttle replacement strategy), and existing 
national policy restrictions on Shuttle use, the committee believes 
that NASA's approach to upgrade planning is appropriate. Candidate 
upgrades are proposed to a central office, which prioritizes them with 
the assistance of tools that are under development. The committee 
commends NASA for its efforts to develop a formal process for 
evaluating and prioritizing upgrades.
Prioritizing and Selecting Upgrades
    Decision makers in the Shuttle program are facing an uncertain 
future. They do not know how long the nation will want Shuttle flights 
to continue, the number of flights per year that will be required, or 
the missions (if any) beyond supporting the International Space Station 
(ISS) the Shuttle will be expected to perform. For these reasons, 
developing an appropriate process for selecting upgrades for 
implementation has been difficult. Other organizations, such as the 
U.S. Air Force, have faced similar situations, however, and NASA should 
evaluate their investment decision processes for upgrades and identify 
appropriate processes and investment strategies to emulate.
    The committee strongly supports NASA's use of program goals to help 
prioritize upgrades. However, the Space Shuttle Program Development 
Office should restate the goals of the upgrade program to ensure that 
they reflect the upgrade program's actual priorities, are feasible, and 
are clearly understandable by everyone working in the program. NASA 
should also provide better incentives for the USA corporation (and any 
future prime contractors for Shuttle operations) to propose, fund, and 
implement upgrades to achieve the Shuttle program's goals. Whether or 
not a Shuttle unique upgrade supports an increased flight rate should 
not be considered in the prioritization process unless NASA can prepare 
a viable business plan showing that (1) the Shuttle could attract 
enough additional business to justify the increased flight rate, (2) 
the Space Shuttle Program would not unfairly compete with commercial 
launch vehicles, and (3) the Shuttle, a national asset, would not be 
subjected to unnecessary risks.
    NASA is taking steps to improve its process for selection of 
upgrade candidates for implementation. These steps are designed to 
provide a more visible quantitative comparison approach that should 
help balance some of the traditional internal and external political 
and other subjective pressures on the program.
    One of the tools that NASA is using to help prioritize candidate 
upgrades is the quantitative risk assessment system (QRAS), a software 
tool being developed specifically for assessing risks to the Shuttle. 
The committee believes that this tool has the potential to be very 
helpful in assessing and comparing the impact of Shuttle upgrades on 
Shuttle safety. NASA should continue to increase the scope and 
capability of the QRAS system so that it provides better models of 
failures caused by human error, combinations of risks, abort modes, on-
orbit hazards, reentry and landing hazards, and software problems. 
Until these improvements are made, the Space Shuttle Program 
Development Office should be very cautious in using QRAS to aid in 
prioritizing upgrades.
    NASA is also funding development of the Decision Support System to 
assist in prioritizing upgrades. The committee believes that when this 
system is more mature, it will be a valuable tool. However, the current 
Decision Support System will require significant modifications before 
it can be a reliable input to the prioritization process. NASA should 
consider modifications that would place less emphasis on quantitative 
results and more on a clear, defensible decision process that takes 
into account all of the available evidence.
    Upgrade cost estimates provided by NASA to the committee contained 
inconsistencies in their scope, assumptions, and basis. For these 
estimates to be helpful, the agency must ensure that they are as 
accurate as possible and are calculated consistently. All calculations, 
comparisons of costs and cost savings, and cost-benefit assessments 
should be based on fixed-year dollars and should include all of the 
costs associated with the upgrade, including hidden costs, such as 
integration costs and the cost of operating and maintaining the 
upgrade.

Improving Candidate Upgrades
    To ensure that NASA can select the best upgrades for the Shuttle 
program, there must be a pool of high quality potential improvements. 
The Shuttle program can take steps to improve the pool of proposed 
upgrades such as external proposals, early compatibility studies, 
limits to software changes, and trade-off studies. The Space Shuttle 
Program Development Office should not consider proposed upgrades as 
stand-alone proposals, but where appropriate, should look for ways to 
combine upgrades (or features of upgrades) to efficiently meet future 
requirements.

                    Assessments of Proposed Upgrades

    From the information presented to the committee, it is clear that a 
great deal of creative and useful work has been done to design and 
develop ongoing and proposed upgrades to the Space Shuttle system. The 
committee was able to assess the potential of some key upgrades to meet 
Space Shuttle Program goals, point out areas of technical or 
programmatic risk, and suggest alternatives. Figure ES-I shows the 
locations of selected representative upgrades in the Shuttle system.

Phase II Upgrades
Checkout Launch and Control System
    The checkout launch and control system (CLCS) is an upgrade to the 
launch processing system used to check out, control, and process 
Shuttle flight systems, ground support equipment, and facilities at 
Kennedy Space Center. The current system is growing obsolete, and the 
CLCS upgrade will replace it with modern commercial hardware and 
software. Based on historical precedent, the committee believes that 
the large and complex CLCS upgrade is likely to experience schedule 
delays and budget overruns. NASA should audit the requirements, 
specifications, plans, schedules, development budgets, status, and life 
cycle costs of the CLCS project. The objective of this audit should not 
be to cancel the upgrade but to make more accurate estimates of the 
time and cost required to complete it and to identify potential 
problems early enough in the project to rectify them.
Protection from Micrometeoroids and Orbital Debris
    As part of the Phase II upgrade program, the Shuttle orbiters will 
be modified during 1999 and 2000 to protect the radiators and the 
leading edge of the wings from meteoroids and orbital debris. 
Considering the predicted high level of risk from this hazard even 
after these modifications are made, the Space Shuttle upgrades program 
should solicit additional upgrade proposals for protecting the Shuttle 
from meteoroids and orbital debris.

Phase III Upgrades
Auxiliary Power Unit
    Every Shuttle orbiter has three auxiliary power units (APUs) to 
pressurize the vehicle's hydraulic systems during ascent and reentry. 
NASA is studying a number of options for replacing the current APUs--
which use toxic hydrazine propellant--with an electric system that 
would be safer and easier to maintain. NASA should continue studying 
potential modifications to the APUs to determine the costs, benefits, 
and appropriate scope of each upgrade. The development of electric 
power systems worldwide should be monitored for technologies and 
techniques that could improve an APU upgrade.

Avionics
    The orbiter's current avionics system was conceived in the early 
1970s but contains hardware that was added during the 1980s and 1990s. 
The objective of NASA's proposed avionics upgrade is to avoid the 
growing costs associated with obsolescent components by judiciously 
replacing hardware and, at the same time, positioning upgrades as 
components of a modern, functionally partitioned avionics architecture. 
NASA should continue this strategy and should develop and publish 
scaleable, long-term requirements and interface definitions for the 
future architecture.

Channel-Wall Nozzle
    The channel-wall nozzle is a proposed replacement for the current 
Space Shuttle main engine nozzle. The channel-wall nozzle is a 
relatively simple design based on a manufacturing process developed in 
Russia. NASA plans to build the nozzle in Russia (through Rocketdyne's 
subcontractor Aerojet) to reduce development costs. If NASA decides to 
implement this upgrade, it should take steps to ensure that channel-
wall nozzles are available in the United States, either by stockpiling 
additional nozzles or developing a channel-wall nozzle manufacturing 
capability in the United States.

Extended Nose Landing Gear
    The proposed extended nose landing gear is a modification intended 
to reduce loads on the orbiter's landing gear. Based on work performed 
to date, the proposed upgrade appears to be a good design for reducing 
Shuttle landing loads. However, the existing nose landing gear meets 
current requirements, so NASA should pursue the upgrade only if future 
plans require that the Shuttle land with heavier payloads than are 
currently allowable.

Long-Life Fuel Cell
    The orbiter's fuel cells provide electric power for the orbiter and 
water for the crew. Two distinct upgrades--longer-life alkaline fuel 
cells and proton exchange membrane (PEM) fuel cells--are being 
considered to replace the current cells. Modified alkaline cells would 
be similar to the current cells but would require less maintenance. The 
PEM cells would last longer, produce more power, and be less toxic than 
either the current or the improved alkaline cells. However, the PEM 
cell upgrade would involve an expensive and potentially open-ended 
technology research program. NASA should explore the costs and benefits 
of the PEM cell further before deciding on a new fuel cell. Planners of 
future space missions that could benefit from PEM fuel cells should be 
closely involved in these studies. These planners could help determine 
the value of PEM cells for future missions, influence the design of the 
Shuttle's PEM cells so that they will be applicable to future missions, 
and, perhaps, provide funding.

Nontoxic Orbital Maneuvering System/Reaction Control System
    This upgrade would modify the Shuttle Orbiter's orbital maneuvering 
and reaction control systems to use nontoxic liquid oxygen and ethanol 
propellants and would connect both systems to common propellant tanks. 
NASA believes that the proposed upgrade would reduce hazards on the 
ground and in orbit, improve ground operations and turnaround times, 
save money, and increase Shuttle performance. Before making any 
decision on implementation, however, NASA should very carefully study 
all of the risks inherent in changing to a liquid oxygen/ethanol system 
and conduct trade-off studies to determine whether modifications to the 
existing system may be a more cost-effective means of meeting program 
goals. Commonality with the propulsion (and possibly the life-support) 
systems of the ISS and other future NASA programs should be considered 
in the final design.

Water Membrane Evaporator
    The water membrane evaporator (WME) is being considered as a 
replacement for the orbiter's flash evaporator system (FES), which 
cools the orbiter during ascent and entry and provides supplemental 
cooling in orbit. The WME appears to be a simple passive device that 
can accomplish the FES's cooling function without the corrosion that 
creates a risk of freon leaks in the FES. However, other options to 
reduce freon leakage (such as using more corrosion-resistant materials 
in the FES) could potentially be lower cost and lower risk solutions to 
the problem. NASA should carefully weigh the costs and benefits of all 
options for dealing with the FES corrosion problem before choosing a 
solution.

Phase IV Upgrades
    NASA is currently evaluating the merits of two new first stage 
booster concepts: the five-segment reusable solid rocket booster 
(RSRB), and the liquid fly-back booster (LFBB). To varying degrees, 
each concept promises improvements in safety, performance, and life 
cycle cost. Each concept also requires significant system integration, 
as well as a thorough ground and flight test program. Each will also 
require large initial investment.
    An important consideration in NASA's ongoing space transportation 
studies is that the existing four-segment RSRB has demonstrated high 
reliability since its first flight in 1988. It also satisfies NASA's 
known performance requirements for the Space Station era. These facts, 
combined with the risks involved in changing to a relatively unproven 
booster on a manned vehicle with only minimal crew escape capability 
means that NASA is not likely to, and the committee agrees it should 
not, enter into any major new booster program without substantial 
national need for the performance enhancements and long-term safety and 
cost benefits.

Five-Segment Reusable Solid Rocket Booster
    A recent proposal by Thiokol Propulsion, this upgrade would add a 
fifth segment to the Shuttle's RSRB, alter the grain of the solid fuel 
to provide a safer thrust profile, and modify the RSRB's nozzle and 
insulation. On its surface, the five-segment RSRB appears to be a 
relatively straightforward approach to improving the performance of the 
booster, but it will require substantial integration engineering and 
testing. Early estimates suggest at least $1 billion development cost. 
A thorough evaluation of the potential for separate implementation of 
subsets of the proposal should be included in NASA's ongoing 
assessment.

Liquid Fly-Back Booster
    This NASA generated concept would replace the Shuttle's solid 
rocket boosters with liquid-fueled boosters designed to fly back 
automatically to the launch site after they have separated from the 
orbiter. NASA believes that the LFBB would cost $4 to $5 billion to 
develop but would improve safety, reduce long-term operational costs, 
enable a higher flight rate, and increase the Shuttle's payload 
capacity. Before proceeding with the LFBB, NASA should initiate a 
detailed independent assessment of configuration trade-offs, costs, and 
programmatic and technical risks to determine the best fundamental 
configurations for a new liquid shuttle booster. Should NASA proceed 
with this program, they should closely coordinate their efforts with 
other government and industry transportation initiatives.
                                 ______
                                 
       NASA Response to the NRC Report on Space Shuttle Upgrades
                     NRC Report on Shuttle Upgrades

    In May 1998, NASA requested the National Research Council (NRC) to 
examine the Agency's plans for further upgrades to the Space Shuttle 
system. The assessment was conducted with reference to the National 
Space Transportation Policy and NASA's 1998 Strategic Plan, which calls 
for the Shuttle upgrade program to improve the reliability, 
performance, and longevity of Space Shuttle operations to meet 
International Space Station (ISS) needs and human exploration goals 
beyond 2012.
    NASA presented the set of proposed Shuttle upgrades, including 
approved upgrades and upgrades currently under study, and the rational 
and criteria used to select the upgrades. The NRC, and its committee, 
assessed NASA's method for evaluating and selecting upgrades and 
conducted a top-level technical assessment of proposed upgrades that 
have not yet been implemented.
    The NRC formed a committee composed of experts from various fields. 
The committee members are the individuals responsible to perform the 
study. Committee members are:

  Bryan O'Connor (chair), Aerospace Safety Consultant, Alexandria, 
            Virginia
  Stephen Book, The Aerospace Corporation, Los Angeles, California
  Benjamin Cosgrove, The Boeing Company (retired), Seattle, Washington
  Donald Emero, Boeing Reusable Space System (retired), Fountain 
            Valley, California
  B. John Garrick, PLG (retired), St. George, Utah
  Richard Harper, IBM Research, Raleigh, North Carolina
  Nancy Leveson, MIT, Cambridge, Massachusetts
  Donald Maricle, Maricle Consulting, Glastonbury, Connecticut
  Robert Sackheim, TRW, Redondo Beach, California
  George Sutton, ANSER, Arlington, Virginia
  Richard Weiss, Richard R. Weiss Consultant Services, Palmdale, 
            California

    The committee delivered a sixty-page report to NASA that includes 
various observations and recommendations. The observations and 
recommendations are both programmatic and technical.
    As part of its observation, ``the committee believes that NASA's 
approach to upgrade planning is appropriate'' (page 2) and the 
``committee commends NASA for its efforts to develop a formal process 
for evaluating and prioritizing upgrades'' (page 2). Also, the 
committee ``strongly supports'' (page 3) the use of the goals set by 
the program to prioritize upgrades.
    The committee acknowledges that the Shuttle Program's uncertainty 
of not knowing how long to operate and the number of flights per year 
required has made the development of an appropriate process for 
selecting upgrades and implementing them difficult. The committee 
states that ``the Shuttle program's limited budget for upgrades has 
constrained the program's responses to this environment, which has made 
it difficult for program managers to prepare adequately for the range 
of possible future scenarios'' (page 24). Also, the committee agrees 
with NASA's approach to use the limited upgrade funds to combat 
obsolescence problems and to perform studies on major upgrades that may 
be needed if the Shuttle is required to operate after 2012. The 
committee correctly identifies that the implementation of the larger 
upgrades will require additional support from the Administration and 
Congress.
    NASA would like to thank the National Research Council for their 
assessment of the Space Shuttle Upgrades program. The Space Shuttle 
will remain an integral part of America's space program for the next 
decade and possibly beyond. It is imperative that NASA takes an 
aggressive role in ensuring that the Shuttle fleet is capable of 
supporting the monumental task of assembling the International Space 
Station; to successfully accomplish this, current obsolescence issues, 
aging hardware problems, and budgetary concerns must be resolved. The 
NRC, in their diligent review of the Shuttle Upgrades Program, 
formulated a list of twenty-five recommendations for NASA. Of those 
twenty-five recommendations, two have been implemented, twenty-one are 
being worked, and two are under consideration. The following is NASA's 
response to the NRC's recommendations.

                 NASA's Response to NRC Recommendations

Recommendation 1. NASA should benchmark other large organizations' 
investment processes for technological upgrades and attempt to identify 
and emulate appropriate processes and investment strategies.
    NASA agrees with the recommendation. To date, the Shuttle Program 
has benchmarked upgrade programs like Concorde, B-1, B-52, F/A-18, 
nuclear power plants, and others. NASA will continue to look at 
organizations that have performed similar projects. Specifically, the 
move towards quantitative methodology, i.e. developing Quantitative 
Risk Assessment Software and use of Decision Support Software, was 
derived from industry benchmarking.

Recommendation 2. The ability of a shuttle-unique upgrade to support an 
increased flight rate should not be a factor in the prioritization 
process, unless NASA can show through a viable business plan that has 
been reviewed and approved by financial and technical experts inside 
and outside the agency, as well as national policy makers (1) that the 
Shuttle could attract enough business to justify the increased flight 
rate, and (2) that the Shuttle program would not unfairly compete with 
commercial launch vehicles or pose unnecessary risks to a national 
asset.
    Currently, the focus of the Shuttle Upgrade program is on the Phase 
II upgrades, which primarily address obsolescence issues. NASA has not 
approved any upgrades solely to support an increase in launch rate. 
Most upgrades that enhance meeting the manifest commitments, increase 
supportability and reduce cost also inherently enable an increased 
capacity or launch rate. Increasing fundamental flight rate does 
provide short-term surge capability and added flexibility for 
unexpected manifest changes and would also reduce operations costs. For 
these reasons, NASA considers it appropriate to consider flight rate 
capability improvements as a factor in prioritization of Shuttle 
upgrade candidates. Given that: 1) the United States currently only 
enjoys a 40% market share in space launch and 2) that following 
International Space Station `assembly complete,' Shuttle will have 
excess capacity, and 3) that NASA's current direction includes 
privatization of Shuttle processing and operations with the downstream 
vision to become an `anchor tenant' for commercialized Shuttle 
services, it seems only prudent to look beyond the current restrictive 
national policy directives regarding Shuttle use.
    NASA agrees that a viable business plan must be developed prior to 
implementing the Phase III & IV upgrades that will enable an increase 
in flight rate. As the committee recommends, NASA will continue to 
perform preliminary studies for the Phase III & IV upgrades.

Recommendation 3. The Space Shuttle Program should reassess the goals 
used to prioritize candidate upgrades to ensure that they reflect the 
upgrade program's priorities, are feasible, and are clearly 
understandable to everyone working in the program.
    NASA agrees with the recommendation. The Space Shuttle Upgrades 
goals have been explicitly the same as the Space Shuttle Program since 
the Space Shuttle Development Office was organized in 1997. They, in 
turn, map to the NASA and HEDS Strategic Plans. They were selected to 
be simple, direct and consistent within the Space Shuttle Program. 
Without question, they could be collapsed into more focused goals which 
still compliment the Space Shuttle Program's objectives. NASA will 
reevaluate the Space Shuttle Upgrades goals to ensure that these goals 
are properly balanced within the Space Shuttle Program.

Recommendation 4. The Human Exploration and Development of Space 
Enterprise should bring the cost goals for the Space Shuttle in its 
strategic plan into line with budget and policy realities.
    NASA agrees with the recommendation. NASA continues to stretch for 
the maximum safe vehicle performance at the minimum cost. Striving for 
those stretch goals rather than settling for less challenging 
objectives causes the Shuttle Program to reinvent rather than do 
business as usual. Business as usual will not achieve the magnitude of 
improvement the Agency must achieve to live within a flat budget that 
equates to a 20% funding reduction when compensating for inflation over 
the five-year budget horizon.

Recommendation 5. NASA should continue to increase the scope and 
capabilities of the quantitative risk assessment system by improving 
its models of failures attributable to combinations of risks, human 
error, abort modes, on-orbit hazards, reentry and landing, and 
software. Until these improvements are made, the Space Shuttle Program 
Development Office should be very cautious in using the quantitative 
risk assessment system to aid in prioritizing upgrades.
    NASA agrees with the recommendation. NASA's Quantitative Risk 
Assessment Software (QRAS) has been acknowledged by the quantitative 
modeling community as a `world class' tool to help assess risk drivers 
within complex, interdependent systems. QRAS has been developed in a 
phased fashion. The first phase fielded the software and modeled the 
systems to at least the same fidelity was previous done by SAIC's PRA. 
The second phase added additional modeling fidelity and subsystems. The 
next phase of the quantitative risk assessment (QRA) system is 
currently being developed and will address the committee's 
recommendations. NASA recognizes that there are some limitations to the 
current QRAS model and until the model is fully developed will use the 
data accordingly as one of many inputs to the Shuttle upgrade decision 
making process.

Recommendation 6. NASA should take care that the Decision Support 
System's quantitative tools are used as a supplement to, not as a 
substitute for, formal qualitative evaluations. Expert Elicitation 
should be considered as an additional formal qualitative tool. Also, 
NASA should consider modifying the quantification algorithm that the 
Decision Support System employs for cost-benefit comparisons so that it 
uses full probability values rather than 20th percentile S-curve 
values.
    NASA agrees with the recommendation. As the committee states in its 
report, the Decision Support System is one of the many tools that NASA 
uses in making upgrade decisions. NASA has also used a more widely 
accepted method called `Analytical Hierarchy Process' to do upgrade 
weighting and ranking. Expert Elicitation is simply another method of 
obtaining knowledge and evaluating solutions. Unmentioned in the NRC 
report, the Shuttle Program has also initiated the Orbiter and GFE 
Trending Report which has done trending of critical subsystems to 
identify the subsystems and components most in need of upgrades from a 
reliability and supportability standpoint.
    The use of the 20th percentile S-curve in the DSS represents one 
method of comparative assessment. Discussions with the NRC panel in 
September 1998 included a healthy discussion of statistical and 
probabilistic theories. From these discussions, NASA is examining the 
suggestions made by the NRC to use other statistical methods to compare 
and rank the collection of upgrades. This activity is part of the 
continuing development of the DSS.

Recommendation 7. All calculations, comparisons of costs and cost 
savings, and cost-benefit assessments done by NASA, as well as its DSS 
independent contractor, should be performed using fixed-year dollars 
and should include all costs (including hidden costs) associated with 
the upgrade.
    NASA agrees with the recommendation and will continue to account 
for all costs as projects mature. The Space Shuttle Upgrades Program 
Requirements Control Board (SSU PRCB) membership includes all the 
Program elements, Program Integration, and the principle contractors. 
All upgrades and change requests are assessed by all parties prior to 
being presented to the board and dispositioned. Every attempt is made 
to establish integration costs and flush out hidden costs prior to 
approval of each upgrade.

Recommendation 8. NASA should provide stronger incentives for the 
Shuttle prime contractor to propose, finance, and implement upgrades to 
meet the Shuttle program's goals.
    NASA agrees with the recommendation and has developed and 
implemented a plan. The challenge is to have the incumbent contractor 
invest in upgrades that do not show return on investment within the 
remaining life of the contract when the contractor is being 
simultaneously incentivized to reduce program cost for which he 
receives a 35% share of the savings. A modified `Value Engineering 
Clause' has been implemented as a way of compensating the contractor 
for upgrades with a longer payback time should that contractor not be 
selected for the follow-on contract option(s). This method is currently 
being reviewed at NASA Headquarters and approval is anticipated in the 
near term.

Recommendation 9. Upgrade project managers should involve industry more 
in the definition and early development of candidate upgrades.
    NASA agrees with the recommendation. NASA has involved industry, 
other NASA Centers and academia in the identification and selection of 
upgrades. All Centers and contractors are welcome to propose upgrades 
to the SSU PRCB under the sponsorship of NASA or USA. The NRC committee 
chairman agrees that the level of involvement of these contractors and 
industry is adequate.
    The Integrated Product Teams (IPT) supporting the Shuttle upgrade 
projects have members representing a variety of government and industry 
organizations. IPT membership generally includes representatives from 
NASA Engineering, NASA Operations, NASA Project Management, United 
Space Alliance (USA) Engineering, USA Logistics, USA operations, and 
Boeing Engineering. In addition, IPT's, such as the Avionics IPT and 
the Cockpit IPT, have members from the Department of Defense and the 
Department of the Navy.
    Since its inception, the Space Shuttle Upgrades Development Office 
has sponsored numerous symposia to bring the best from industry to 
focus on Shuttle Upgrades (SATWG at Boeing, Seattle; SATWG at JSC, 
Houston; ATWG at KSC, Florida; ATWG at Palmdale, CA; Nano-MEMS 
Technology Conference JSC; USA Industry Space Council, United 
Technologies, East Hartford, CT; USA Joint NASA-Industry Upgrades 
Conference TBD).

Recommendation 10. The Space Shuttle Program should institute a process 
early in the development of a candidate upgrade to ensure that the 
upgrade is compatible with other Shuttle systems and relevant to 
meeting program goals.
    NASA agrees with the recommendation. As the committee stated in its 
report, the upgrade priorities are based on Shuttle Program goals. All 
proposed upgrades must compete within the SSU PRCB forum for scarce 
resources. The composition of the SSU PRCB makes compatibility and 
relevance explicit parts of the evaluation process. All upgrades are 
vetted by other Shuttle Program elements for impacts to hardware, 
training, cost and schedule.

Recommendation 11. NASA should limit the software changes associated 
with new Shuttle upgrades. The agency should consider standardizing its 
guidelines for using commercial off-the-shelf software in Shuttle 
upgrades.
    NASA agrees with the recommendation. As part of the system 
engineering process, all software changes required for each candidate 
upgrade are evaluated. Commercial off-the-shelf (COTS) products are 
considered to reduce cost and schedule. The Shuttle Program's 
experience in using COTS products has occasionally uncovered 
deficiencies which may be costly in terms of schedule and program risk. 
NASA (JSC Engineering) has developed a set of COTS utilization 
guidelines that will be used for all Orbiter Government Furnished 
Equipment hardware. These guidelines will also be reviewed and 
considered for broader adoption by the Shuttle Program.
    Where appropriate, for example, the Government Furnished Equipment 
projects, NASA is in the process of developing standards for off-the-
shelf software and hardware.

Recommendation 12. Before embarking on the larger, more costly 
upgrades, NASA should examine alternative solutions and conduct trade-
off studies to determine if the proposed upgrade is the best way to 
achieve the desired result.
    NASA agrees with the recommendation. Trade-off studies will be 
performed prior to the implementation of any upgrade. Case in point, 
NASA conducted a trade study for the Phase III global Avionics Upgrade 
to the Orbiter. Studies are currently underway on Phase III Integrated 
Communications Upgrade and Liquid Flyback Booster versus Fifth Segment 
Solid Rocket Motor Phase IV upgrades.

Recommendation 13. The Space Shuttle Program Development Office should 
not consider proposed upgrades as stand-alone modifications but should 
look for opportunities to combine upgrades (or features of upgrades) to 
efficiently meet future requirements.
    NASA agrees with the recommendation. NASA will continue to combine 
upgrades in the most efficient and practical manner while adhering to 
the Shuttle Upgrade goals and the Shuttle Program goals. NASA has 
challenged the Space Flight Operations Contract (SFOC) contractor, 
United Space Alliance, and the Orbiter contractor, Boeing North 
American, to strive for synergy within the upgrades proposed.

Recommendation 14. NASA should conduct an audit of the requirements, 
specifications, plans, schedules, development budgets, status, and life 
cycle costs of the checkout launch and control system project. The 
objective of this audit should not be to cancel the upgrade but to 
estimate more accurately the time and cost required to complete it and 
to identify potential problems early enough to rectify them.
    NASA agrees with the recommendation. The Independent Assessment 
Review (IAR) team has completed a review of CLCS project and the 
Shuttle Program is formulating a response to the IAR. The review to 
date shows the base system on COTS platforms and application program 
interfaces are near completion, thereby traversing a period of unknown 
complexity. The end product functionality is better understood and 
defined. The remaining development is being addressed and replanned 
with particular attention on lessons learned metrics gathered to date. 
On the strength of new detailed basis of estimate, a schedule of the 
remaining tasks and an updated budget is being finalized for review by 
program management.

Recommendation 15. The Space Shuttle Program Development Office should 
solicit additional proposals for upgrades to protect the Shuttle from 
meteoroids and orbital debris.
    Under evaluation. The Space Shuttle Program has used and continues 
to use control of the attitude timeline to minimize debris impact 
risks. In preparation for International Space Station assembly 
missions, where the attitude is constrained by assembly requirements, 
the Program conducted an extensive evaluation of the components with 
the highest contribution margin to debris risk. To minimize the risk of 
early termination of the mission, modifications are being made to the 
radiator systems. ``Armor'' is being applied over the coolant flow 
loops and isolation valves are being added, so that if a radiator is 
penetrated, it can be isolated so that the fluid is not lost from the 
water boiler portion of the heat rejection loop. To minimize the risk 
of significant critical damage during entry the thermal protection of 
the wing leading edge has been modified to contain the heating loads of 
plasma flow due to a penetration of the reusable carbon-carbon leading 
edge. Previously the design accommodated only the radiant heat loads 
from the RCC. While other potential changes have been identified they 
have not demonstrated significant impact on the overall meteoroid and 
debris risk.

Recommendation 16. NASA should continue studying potential 
modifications to the APUs to better determine the costs, benefits, and 
appropriate scope of an upgrade. Developments in electric power systems 
worldwide should be monitored to identify technologies and techniques 
that could be useful for an APU upgrade.
    NASA agrees with the recommendation. NASA continues to develop a 
proof of concept for an electric Auxiliary Power Unit to eliminate the 
toxic propellant, high temperature hazard in the aft fuselage, 
eliminate high speed rotating turbine wheels and reduce the continuing 
maintenance and reliability burdens.

Recommendation 17. NASA should continue its strategy of judiciously 
replacing obsolete avionics components while developing a plan for a 
future improved architecture. Consistent with the year 2000 decision 
process, NASA should develop scaleable, long-term requirements and 
interface definitions for the future architecture.
    NASA agrees with the recommendation and will continue to develop an 
avionics upgrade plan. NASA has already solicited the major aerospace 
contractors' architectures and costs to address this issue. This is a 
phase III upgrade candidate.

Recommendation 18. If NASA decides to implement this upgrade, it should 
take steps to ensure that channel-wall nozzles are available in the 
United States, either by stockpiling additional nozzles or developing a 
channel-wall nozzle manufacturing capability in the United States.
    NASA agrees with the recommendation. The decision has been made 
that if NASA decides to implement the channel wall nozzle, the nozzle 
will be manufactured in the United States.

Recommendation 19. NASA should pursue the extended nose landing gear 
only if future plans require that the Shuttle land with heavier 
payloads than are currently allowable.
    Under evaluation. The Extended Nose Landing Gear modification is 
currently under review by the Space Shuttle Program. The Extended Nose 
Landing Gear project will be presented to the Space Shuttle Upgrades 
Program Requirements Control Board (SSU PRCB) in April 1999. The 
decision to proceed with this upgrade will be based on the amount of 
additional margin this upgrade provides versus the cost and complexity 
of the upgrade. If the cost ($20 M) and complexity does not justify 
the gain in margin then this upgrade would be put on hold. If larger 
orbiter landing weights are required in the future and this change 
proves to be beneficial in providing additional downweight capability, 
along with significant structural modifications, then this upgrade may 
be reconsidered.

Recommendation 20. NASA should continue to explore the costs and 
benefits of PEM cells before making a decision on a future Shuttle fuel 
cell. Planners of future space vehicles and/or missions that could 
benefit from PEM fuel cells should be closely involved in these 
studies.
    NASA agrees with the recommendation. NASA has decided to implement 
the long life alkaline Fuel Cell for the Shuttle Program to address 
reliability and maintainability issues for the next decade. At the 
present time, though, the technology is elusive for space applications 
with only modest progress having been made in terrestrial applications 
despite the investment of approximately $10B worldwide in the 
automotive industry. Shuttle integration and implementation are likely 
to be complex and expensive due to incompatibility with current 
plumbing. Without question, Proton Exchange Membrane (PEM) Fuel Cell 
technology has tremendous potential for future space systems.

Recommendation 21. Before NASA makes any decision on implementation, it 
should very carefully study the risks inherent in changing to a 
nontoxic OMS/RCS system and conduct trade-off studies to determine 
whether modifications to the existing system may be a more cost-
effective means of meeting program goals. Commonality with the 
propulsion (and potentially life-support) systems of the ISS and other 
future NASA programs should be considered in any final design.
    NASA agrees with the recommendation. NASA will consider all factors 
prior to implementing Non-toxic Orbital Maneuvering System/Reaction 
Control System. Currently the reliability driver is the RCS thrusters.

Recommendation 22. NASA should reassess the costs (including those 
associated with surface tension issues and development testing) and 
benefits of all options for dealing with the corrosion problems in the 
flash evaporator system before choosing a solution.
    NASA agrees with the recommendation. NASA is evaluating various 
options. The Water Membrane Evaporator is, as yet, only a promising 
technology. In the interim, NASA continues to repair and fabricate the 
existing design.

Recommendation 23. NASA should formally evaluate the merits of the 
five-segment reusable solid rocket booster as it prepares for the 
decision on the future of the Shuttle program. A thorough evaluation of 
the potential for the separate implementation of subsets of the 
proposal should be included in this assessment.
    NASA agrees with the recommendation. NASA's Office of Independent 
Assessments is currently conducting a trade of Liquid Flyback Booster 
vs. 5th Segment SRB. NASA has approved funding for a fifth segment 
Solid Rocket Booster study that will aid in the evaluation of 
alternative booster options for the Space Shuttle Program. Refinements 
continue to the existing RSRM/SRBs to address remaining opportunities 
to reduce CILs and address environmental and material obsolescence 
issues.

Recommendation 24. NASA should initiate a detailed independent 
assessment of configuration trade-offs, costs, and programmatic and 
technical risks for a new Shuttle booster.
    NASA agrees with the recommendation. An independent assessment of 
the booster options is being performed by the NASA Langley Research 
Center Independent Assessment Office.

Recommendation 25. NASA should coordinate closely with other government 
and industry transportation initiatives in determining the need and, if 
appropriate the resources for any new Shuttle booster.
    NASA agrees with the recommendation. NASA is currently working with 
industry on the Space Transportation Architecture Study to develop an 
evolutionary path for reusable first stage technologies and possible 
evolution of a subscale demonstration vehicle.

    Senator Wyden. Thank you very much. Gentlemen, I have got 
to leave in a few minutes to deal with the problems faced by 
the Klamath County farmers in my home State that you may have 
heard about. Therefore, I am going to turn the hearing over to 
our colleague, Senator Nelson, but I did want to ask a couple 
of questions. One quick question for you, Mr. Li.
    In the GAO report that has been recently released, at page 
4 of the report, there appears to be what certainly strikes me 
as a very troubling finding by your agency, indicating that 
when it comes to the Space Station, NASA cannot really tell you 
what it is they have spent thus far. I want to know, if that is 
the case, if I am reading it correctly.
    For obvious reasons, there are those of us who agree with 
Senator Nelson that we are going to have to spend money, as it 
relates to these safety upgrades. However, it is going to be 
pretty difficult to convince our colleagues that these 
expenditures ought to be made when those who are not so 
sympathetic come back and wave a GAO report in our face and 
say, well, page 4, it says it cannot tell you what they have 
already spent.
    Are we reading that correctly, number one? And, if so, what 
are the implications? Just so the NASA people are at the ready 
here, I will be asking you to respond after Mr. Li has answered 
my question.
    Mr. Li. Yes. This is a very complicated issue. What we were 
asked to do was the Congress asked us to make sure that there 
was no exceeding of the cap that was established. What we found 
was that at the subsystems level, at the system level, at the 
individual modules, they could not identify what was actually 
spent for that particular component.
    NASA disagrees and feels that their accounting system, in 
terms of using simply the budget authority that is being 
provided to them, is sufficient. We were looking for actual 
expenses, and they do not track it in that manner.
    Senator Wyden. Does NASA want to respond to that?
    Mr. Readdy. Mr. Chairman, I am prepared to speak today on 
the Space Shuttle, and I can assure you that in the Space 
Shuttle arena, we are down to a tenth of a percent in terms of 
accounting for what we spend in our program.
    Senator Wyden. That is fair. Let us just say I would like a 
response to that in writing, though, with respect to the Space 
Station.
    Mr. Readdy. Yes, sir.
    [The information referred to follows:]

    NASA has complete and reliable data concerning the total cost of 
the International Space Station program. The disagreement between GAO 
and NASA centers on how NASA should track Space Station costs at a 
detailed level.
    GAO believes that NASA should track the cost of individual Space 
Station subsystems or elements. NASA, however, believes that for 
project management purposes it is important to track costs by work 
breakdown structure. This approach facilitates NASA's and the 
contractor's understanding of costs incurred and future projected 
costs. Within these work breakdown structures are identified subsystems 
and hardware elements, among others. NASA requires the identification 
of all supporting costs, such as systems engineering and safety and 
mission assurance, but these costs remain separate and are not included 
in the costs of individual subsystems and hardware elements. This 
approach provides NASA with a valuable project management tool and 
assures that all Space Station costs are fully accounted for.

    Senator Wyden. Because it does go to the heart of this 
effort to properly fund safety. If we do not have answers to 
those questions and people wave GAO reports that make a finding 
like that, it will be difficult to get the funds that are 
needed for safety.
    Let me ask one question for the entire panel, and I want to 
go right down the row. I think what we are going to see this 
issue come down to, given the budget situation, is looking at 
how to balance the safety gains, which are so important and 
which we have all made clear we are not going to compromise, 
against cost considerations and technical readiness. I would 
like to hear from each of you how you would go about trying to 
strike that balance because clearly, if you have unlimited 
funds, then there is no problem. You get everything under the 
sun with respect to safety and you hope some of it works, and 
if it does not, so be it. But we are going to have to figure 
out a way to balance these questions of necessary safety 
upgrades against cost and technical readiness.
    If you would, pretend you have the election certificate and 
you are sitting up at this end of the dais and tell us how you 
would go about striking that balance. We will begin with NASA, 
and we will go right down the line. Then when I am done with 
that question, I am going to turn it over to our friend from 
Florida.
    Mr. Readdy. Mr. Chairman, I had prepared a very detailed 
answer for you, but it took 10 years and $40 billion to develop 
the Space Shuttle. It goes from a rocket ship for 8\1/2\ 
minutes to a space craft for 2 to 3 weeks to a hypersonic 
reentry vehicle for an hour, and the lowest L over D fighter 
type airplane you would ever land, fly by wire for about the 
last 5 minutes. It is complicated because it has to accomplish 
all those things in one vehicle. That investment is the 
foundation of human space flight for this nation, and the world 
counts on us to do that, to leverage the investment in the 
International Space Station.
    We are on the threshold of being able to utilize that 
International Space Station, having just finished Phase II of 
the assembly, using the Space Shuttle as the work horse and as 
the assembly platform and now to use it as the logistics 
platform and the utilization vehicle for that.
    So, what hangs in the balance is not simply our previous 
investment, not only in Shuttle and Station, but the future 
harvest from the International Space Station from those other 
missions that are unique that the Space Shuttle can perform. 
So, I guess I would couch it in those terms.
    Senator Wyden. Mr. McCulley.
    Mr. McCulley. I will go back to part of my opening 
statement that said there is a fundamental question; that is, 
do you want human access to space in a safe and reliable 
vehicle? And a bit of a history lesson, which I might have 
already said, in the 1990-1991 timeframe the NASA Space Shuttle 
program manager, I think had about $5 billion for a budget, and 
today he has $3 billion for a budget. So, it is a 40 percent 
decrease in that 10-year period, yet we are still flying. We 
just finished a period where we flew at the same flight rate. 
So, we have given at the office, to put it in one form. And the 
life has changed because now we are looking at flying it for 
many more years, not just a few more years, and it requires 
investment.
    I think it is probably more of a schedule issue and 
reliability issue in many cases than safety, because we have a 
very rigorous, some would say cumbersome, set of requirements 
that get you down to go fly at T-Zero, and we will continue to 
press to satisfy every single one of those thousands of 
requirements for each mission. But what we are going to find 
with infrastructure not being there and with the older systems 
on the Shuttle is that we will then end up with safety 
concerns.
    If I were in your position, then I would answer that first 
question about whether we want that human access and then here 
is what it takes to get it. And, oh, by the way, these guys 
have done a pretty good job in the last 10 years bringing costs 
down, where many other agencies are having increasing budgets.
    Senator Wyden. Mr. Blomberg.
    Mr. Blomberg. I certainly agree with what my two colleagues 
have said, but I would also like to point out that perhaps we 
have a semantic issue here when we use the phrase ``upgrades.'' 
We think of that as an improvement, but we really have to look 
at upgrades first as holding our own. If we do not do something 
to this vehicle, the safety level will decline inevitably 
because of the aging nature of the vehicle and the 
infrastructure. So, I guess I would first focus on what will it 
take to just break even, and I think that is not trivial. As 
you mentioned, Senator, our panel does not look at budget, but 
I am afraid, from my own sense of things, that the budget is 
only barely adequate to break even, and maybe not even enough.
    Then if you look at the opportunity for risk reduction that 
is out there, that is what can really be captured once you get 
to a stable position and say we can hold our current safety 
level. Now how can we improve it and what are the most cost 
effective ways to improve it? But we cannot lose sight of the 
fact that if we do not do something, this vehicle is going to 
get riskier and riskier to fly.
    Senator Wyden. Mr. Li?
    Mr. Li. I guess I have, perhaps a slightly different 
perspective on this. I think it is a matter of setting 
priorities, and that sounds very trite. I think when you set 
priorities, you have to be able to establish what is the risk 
level of each one of these individual improvements you want to 
make.
    I think one of the difficulties that NASA has is that there 
is a mixture of both safety and performance capabilities in a 
lot of these upgrades. Of course, sometimes you cannot really 
differentiate and say that if you are going to improve the 
performance, you would not be improving the safety also at the 
same time. I think that those are very difficult to 
differentiate.
    The other thing that I would provide as a suggestion is 
that you need to take a look at how long is your exposure to 
risk. In my testimony, I mentioned the fact that if the 
replacement, which is possibly an RLV, how long is it going to 
take for that vehicle to come about. If that vehicle is going 
to be coming in 2012, I may make different decisions than if it 
is going to be in 2020. I have an 1986 Volvo. If I know I am 
going to keep it for another 5 years, I may get myself a new 
pump or something, a new water pump. But if I am going to get 
rid of it next week, I am certainly not going to do it.
    Senator Wyden. Good. Thank you.
    Mr. O'Connor?
    Mr. O'Connor. Mr. Chairman, I do not have much to add to 
what you have heard other than when we first came up with Space 
Shuttle, we saw it as an operational vehicle. It had a huge, 
high flight rate. It had all kinds of missions. It was flying 
commercial type activities very early. You remember that we 
declared the Space Shuttle ``operational'' after its fourth 
test flight.
    Today it is not anywhere close to operational. If you look 
at the risk picture of this vehicle, from an operational 
viewpoint, they are so well below what would be considered an 
operational vehicle from a safety risk view, or of any kind of 
a DOD or commercial flying vehicle. The Space Shuttle is far 
from that. Further, it has no escape system to accommodate that 
high risk.
    Therefore, I believe that we continue to fly operations 
with what I would consider to be a risk prototype, an R&D type 
vehicle. It is doing very well, but we cannot let it go 
backward. As Mr. Blomberg pointed out, you have to spend money 
to keep the risk level where it is today, and it must be 
replaced by something that started from the bottom up to be 
operational, and this time we need to do it right.
    Mr. Readdy. Mr. Chairman, if I could amplify Colonel 
O'Connor's statement there. Just for comparison, the F-22, 
which of course is undergoing flight test right now, has flown 
approximately 600 flight test missions. The Space Shuttle has 
flown a little over 100. We are going to field the F-22 in 2005 
or thereabouts. It has had over 1,200 flying hours to date. The 
Space Shuttle in dynamic flight, 8\1/2\ minutes of ascent and 
roughly an hour on entry, has had about 120 hours of dynamic 
flight test. So, we are nowhere near the operational program 
that we would like to be at this particular point, and it is 
going to require continued R&D to maintain our Human Space 
Flight program.
    Senator Wyden. Gentlemen, I wish I could stay here longer, 
but in a sense, at least for me, this may be a good breaking 
point as well. I want to leave you, though, with one thought.
    My thought is that as Chairman of this Subcommittee, I am 
very sympathetic to this issue of additional funds being needed 
with respect to safety. I can tell you, even apart from the 
fact that Bill Nelson has been a friend of mine for now 2 
decades, for 20 years, I would still be willing to go to 
Barbara Mikulski and to those that are on this conference and 
to make the case for additional funding.
    But I would urge you to do what Mr. Li just mentioned, and 
that is to set some priorities. That is absolutely critical at 
a time when this budget is strapped in a very dramatic fashion. 
Senator Nelson and I represent a lot of senior citizens. This 
morning we were told that the Administration recosted 
prescription drug benefits and one-third of the money 
disappeared. One-third of the money, in effect, just vanished. 
So, these budget choices are going to be very, very tough. I am 
prepared to go to Senator Mikulski and those on that 
Subcommittee with my colleagues to argue for additional funds, 
but I would urge you to take heed of what Mr. Li has said with 
respect to some priorities. They have got to be set.
    In addition, if I might paraphrase what my mother always 
said. When we were talking about a budget, she would always 
say, son, sharpen your pencil because there are savings that 
can be found and economies that can be found in every single 
budget.
    You have been an excellent panel. Senator Nelson has told 
me about how dedicated all of you are and that is very evident 
in your comments here today. I look forward as Chairman of the 
Subcommittee to working very closely with each of you. With 
that, I am going to turn it over to Senator Nelson.
    Senator Nelson. Mr. Chairman, before you leave, let me just 
say that I think the quandary, the conundrum that we find 
ourselves in, the reason we are trying to have this hearing 
today, is the fact that NASA has mismanaged the Space Station, 
and as a result, you have had these huge cost overruns. But 
then when confronted with what we are going to do in the 
future, it appears that sources would want to punish NASA for 
NASA's misdeeds by cutting back on other parts of the program 
which I think the testimony here from all these people has 
dramatically demonstrated that we do so at the risk of life, 
indeed at the risk of the entire Human Space Flight program.
    So, it kind of reminds me of my colloquy on the floor with 
Senator McCain. He was very rightly taking out after NASA's 
mismanagement and cost overruns on the Space Station. But we 
have got to get beyond that because we have got a lot at stake 
right here.
    Senator Wyden. Very good.
    Why do we not recognize Senator Allen and Senator Nelson 
will chair.
    Senator Nelson [presiding]. Thank you.
    Senator Allen.
    Senator Allen. Thank you, Mr. Chairman-designee.
    We have about 5 minutes. There are so many questions 
listening to you all.
    I want to say to Mr. Li that I loved the way you use an 
analogy, whether it is the Volvo or an automobile. Senator 
Wyden and I were saying about these add-ons or upgrades, it is 
like getting upgraded tires, although your tires on the Space 
Shuttle cost $9 million for the upgrades, which of course may 
seem very high. But regardless, I think to get public support 
and understanding for some of these things, I like to use 
analogies and try to just use some common sense ways of looking 
at things.
    I will try to prioritize my questions to everyone here. 
First to Mr. McCulley, of this projected $218 million shortfall 
in fiscal year 2002, $54 million was due to contractor rate 
increases, according to NASA. This is the same sort of thing to 
some extent with fuel, for example, that anybody would 
understand, with the costs for natural gas, the spike we had 
with that earlier, as well as just regular old fuel that some 
of us would use in our Volvos or Dodges or Fords or whatever.
    As a contractor or the operator of it, can you elaborate on 
what this $54 million increase in costs is?
    Mr. McCulley. The $218 million is program-wide, and United 
Space Alliance is approximately 50 percent of the program-wide 
budget. So, just on a straight scale, linear scale, we would 
represent maybe half of that $218 million. I do not know 
exactly how it is distributed.
    But what we have done for the first 5 years of the space 
flight operations contract and what we have projected for the 
years in front of us has been basically 4 percent a year for 
each of those years. And we have performed very, very close to 
our projections. That 4 percent is our merit pool. It is our 
annual raise to account for inflation and to keep our 
engineers, technicians, and other employees lined up with the 
rest of the economy.
    We are maybe $1.5 billion or so for the whole contract. I 
think between Florida and Texas, maybe two-thirds of that is in 
the salaries and medical and benefits range. So, if you take 4 
percent of that, then that puts you in the $40 million or so 
there. The $54 million would probably apply to all the 
contractors, not just to us. So, that would represent I think 
around a 4 percent or so escalation, which is what most of us 
have been telling NASA all along. Both our historical track 
record and our projections have been at that 4 percent rate.
    Senator Allen. I know I am green and new here, but should 
that not somehow be reflected in budget projections rather than 
saying it is a shortfall if everyone has known that the salary 
increases and so forth are going to be going up 4 percent?
    Mr. McCulley. Yes, sir. There is a difference between 
contract value which is back when we started the contract and 
we bid the proposal to NASA, we put those escalation rates into 
our pricing for our proposal. However, the budget is quite a 
bit different than the contract value, as it turns out, and the 
contract value has been higher every year than the budget. So, 
we had those escalation numbers in the proposal that was 
accepted when the contract was originally issued. The budget 
numbers are a different subject.
    Senator Allen. It is just the way, I guess, things operate 
up here. It does not make a great deal of sense to me having 
come from the real world.
    [Laughter.]
    Senator Allen. Let me ask you this question because I think 
it matters a great deal. I am glad they will have some of those 
Space Shuttle objects flying around the Richmond International 
Raceway Saturday night--the Winston Cup Races. But other than 
for the Space Station assembly, what do you see as the 
prospects for the future use of the Shuttle, and are there any 
commercial interests in the Shuttle orbiters that you are aware 
of?
    Mr. McCulley. Let us see. Mr. Readdy may be better.
    Senator Allen. Well, either one. I thought you would. 
Whoever feels most capable of answering.
    Mr. McCulley. Let me start. Then you can finish.
    Next year we have a Hubble servicing mission, which will be 
the third or fourth trip back to Hubble Space Telescope. There 
is a science mission on the horizon that would utilize Columbia 
either late next year or early the next year. And let me go to 
Mr. Readdy with that.
    Senator Allen. Hubble folks understand that. But, for 
example, whatever the last thing you said was. What did you 
say?
    Mr. McCulley. A science mission that would supplement Space 
Station, and I think it is presently on the manifest for early 
2003.
    Senator Allen. Yes, but what is the science that is being 
transacted?
    Mr. Readdy. Human biology and microgravity research. It 
maybe is not quite ready for International Space Station yet, 
so the Space Shuttle is being used as an augmentation to do 
near-term research.
    Senator Allen. Are there any commercial interests involved 
in that?
    Mr. Readdy. There are commercial payloads that we fly. On 
typical missions we will fly commercial payloads, and we are 
making more of an initiative to seek out commercial payloads. 
We have SpaceHAB, which is one of our contractors, that has a 
set-aside for a percentage for commercial on each and every one 
of their lab module missions. So, we are doing that.
    The other thing that we have is preliminary discussions for 
maybe a salvage mission in space for a commercial satellite.
    We also have another interagency support mission that we 
have done. We did a Shuttle radar topography mission for the 
DOD. We have a rich history of having launched communication 
satellites before Challenger, and we have supported all manner 
of missions over the Shuttle's 106 flights.
    Mr. McCulley. And as a company we have worked, in the last 
couple of years, fairly actively with the Air Force and with 
other DOD interests to make sure they know that the capability 
is there, the heavy-lift capability in the Shuttle, for some of 
their payloads.
    Senator Allen. Thank you.
    Colonel O'Connor, this was generally what Senator Wyden was 
getting at and you brought it up in your testimony about 
finding a quantitative way. I was reading through these 
briefings of all the different improvements that were safety 
improvements, whether it is the Space Shuttle Main Engine Block 
III, or the Advanced Health Management System, or the Thrust 
Vector Controls, and so forth and so on. In each and every one 
of them that I went through, there was an analysis. This might 
reduce it by 40 percent and so forth. Mr. Li naturally 
understood all those.
    You mentioned as well having a quantitative approach or try 
to get some way of judging, if you cannot do everything, what 
will have the most bang for the buck, what is the most 
affordable.
    Your 1999 NRC report recommended that NASA should modify 
its system for prioritizing upgrades. Now, has NASA changed its 
system in your view to adequately prioritize the implementation 
of new upgrades? And if not, would you suggest any 
improvements?
    Mr. O'Connor. We made something like 25 recommendations. 
There was only one that they did not endorse and take action 
on, and they may have since then. That had to do with putting 
more effort on looking for ways to reduce orbital debris risk.
    The reason we brought that up, though, was right on the 
mark you are making. We looked at how much money was spent to 
reduce the risk of the main engines, over $1 billion at that 
time on the turbo pump upgrades, and the reduction in risk that 
that represented was a certain value. Then we looked at how 
much money was spent to reduce almost that same amount of risk 
for the whole Shuttle on orbital debris upgrades where they had 
put some covers on the radiators that are exposed to orbital 
debris risk on orbit, and they had changed the thermal control 
system for the leading edge of the wings so that if they did 
take a hit, it would not destroy the vehicle on reentry. That 
was something like $60 million. So, you got almost the same 
reduction in risk for a tremendous difference in price.
    My numbers may be a little off, but when we looked at that, 
we realized that you need to always look at that. You need to 
look at the bang for the buck that you get for these things 
when you are looking at safety.
    Now, having said that, we also realize that you should 
never use just one of these tools to make your decisions. The 
committee was firm in saying they do not believe in making your 
decisions only on a quantitative bang for the buck study. You 
have to do the qualitative, the subjective, the engineering 
looks.
    If you like analogies, the one I use is when I was a little 
kid growing up in southern California, my dad on some weekends 
would take us to Disneyland. At the time Disneyland was not 
built yet. They had a green fence around the whole place. Mr. 
Disney was a great guy. He put little holes in that fence at 
various heights so children of all sizes could look through and 
see what is going on at Disneyland. But the routine was that 
the parents would bring the children, they would look in the 
fence, they would drive around the block, they would look in 
that hole in the fence, they would drive around the block, they 
would look in that hole, and they would look through about four 
or five different holes to try to get some understanding of 
what was going on in Disneyland.
    And that is what they have to do with these upgrades, to 
prioritize them, to see which ones are the best. It is not just 
a single bang for the buck peephole, but do the engineering and 
the qualitative and all these other things along with that. 
That was our recommendation.
    Senator Allen. And do you feel that NASA has followed 
through on that recommendation?
    Mr. O'Connor. Yes, sir. At that time, when we looked at it. 
Again I have not been looking at Space Shuttle myself since 
this committee, which is about 2 years ago now, to watch for 
the follow-ons. The committee was not asked to do that. But at 
that time, we thought they have an excellent system for 
prioritizing. They did not use just one system. They had 
independent look-sees to try to take care of the normal biases 
you get from center to center, from region to region, the 
advocates from different companies saying that mine is the 
best. They hired independent people to come and take a look and 
try to strip that away and get the best they could, and we 
thought they were doing the appropriate actions.
    Senator Allen. Well, it seems like they did. Seeing how you 
are outside of it now, but obviously with a great deal of 
knowledge from the recent past, it seems to me that in a 
roundabout way on some of these that ended up on this--Electric 
Auxiliary Power Unit I believe it was. The cost just kept going 
up and up and up, and they finally said let us have some 
reality here. We are not sure about the quality of this, the 
engineering of it, and certainly the cost. It seems to me that 
almost got winnowed out by using that sort of an analysis. 
Would you agree, Mr. Readdy?
    Mr. Readdy. Yes, sir. Senator Allen, I would like to submit 
something for the record here that was omitted from your 
package.
    First I would like to say that with respect to the NRC 
study, they had 25 recommendations. We implemented all 25. We 
have had 9 independent reviews from external groups to look 
over our shoulder on Space Shuttle upgrades. They have all 
found that we have a systematic approach to address the risk in 
the Space Shuttle program.
    A picture is worth a thousand words. If I could share this 
with you. I am sorry I only have one copy, but I will bring it 
forward. Basically what it shows is all these little icons are 
elements of the different components of the Shuttle. Some are 
main engine. Some have to do with solid rocket boosters. Some 
have to do with the external tank. Some have to do with the 
orbiter itself. What we did was used a quantitative tool that 
Colonel O'Connor described, and we looked at each and every one 
of those elements. This box down here represents the highest 
risk. We methodically put in place an upgrade program to 
address each and every one of those.
    For example, in the electric APU, that remains the highest 
risk item in the Space Shuttle orbiter. The unfortunate thing 
is the battery technology, the packaging density for those 
batteries does not exist today to be able to implement it. As a 
result, we thought we made a prudent decision to go ahead and 
stop that program, put some money into technology, and use that 
money for other purposes. But we have done the same thing with 
the other upgrades. So, we do have a very systematic approach 
to attack each and every one of these higher risk items.
    Senator Allen. Thank you. Thank you very much. Mr. 
Chairman, I will yield to you. I know I went way over 5 
minutes.
    Senator Nelson. No, Senator Allen. I had them turn off the 
lights because we are going to be at this as long as we need 
to.
    I wanted to follow up on an initial question of Senator 
Allen's. He was wondering about what does the Space Shuttle 
deliver for us today, and it occurred to me, did we not launch 
the Chandra Observatory on the Space Shuttle?
    Mr. Readdy. Yes, sir, we did. STS-93 in July 1999.
    Senator Nelson. Does it have a capability of being serviced 
by the Space Shuttle?
    Mr. Readdy. Chandra does not, but the Hubble Space 
Telescope does. And we are flying our fourth servicing mission. 
It is scheduled for this coming January.
    Senator Nelson. The point that I want to make, Senator 
Allen, in response to your question, is just today--I know it 
is in The Washington Post, so it must be in most every other 
newspaper.
    Senator Allen. You might want to get an independent 
verification. But go ahead.
    [Laughter.]
    Senator Nelson. What is the name of the Richmond newspaper?
    Senator Allen. Richmond Times Dispatch.
    Senator Nelson. It is probably in the Richmond Times 
Dispatch as well because it was a major story. The fact is that 
the Chandra observatory, which is one of the great 
observatories that the Space Shuttle has put up, like the 
Hubble Space Telescope, which is in the visual part of the 
electromagnetic spectrum--the Chandra is the in X-ray spectrum. 
Chandra has discovered a huge black hole that we have been 
looking for for years. And it is just another example that it 
is a routine article, nevertheless a very important news 
article, in this morning's newspapers about what is the 
viability and the importance to the country as we are 
explorers, as we are adventurers in trying to understand what 
is out there and where we came from and how it evolved and what 
still might be out there. So, I just mention that to you. It is 
a timely story.
    Please feel free to----
    Senator Allen. I have to go.
    Senator Nelson. You are going to have to go. And we are 
going to have a vote momentarily, but even if I have to recess, 
we are going to keep going and get all the questions in.
    Mr. Blomberg said that he thinks that the current budget 
may only be barely enough to break even, or words to the effect 
that you used. So, Mr. Readdy, I want to ask in your 
professional opinion, is the fiscal year 2002 budget, as 
proposed by NASA, enough to break even at a flight rate of six 
flights a year?
    Mr. Readdy. Sir, as I said in my statement, we are facing a 
shortfall right now in 2002 of $218 million. Inflation 
continues to erode our purchasing power and we are somewhere 
around 40 percent of what we were starting in 1990 at this 
point, and it will continue to erode at the rate of inflation. 
Maybe Mr. McCulley can speak to it, but I see it being 
increasingly hard to get more efficiencies out of the contract 
that we have with United Space Alliance, even if we go to 
further privatization.
    Senator Nelson. Does anybody else want to comment on that?
    Mr. McCulley. Also, to put that $218 million in 
perspective, I think it is around maybe 7 or 8 percent of the 
total Shuttle program budget. So, it is a number that will 
work. If it is what we have to live with, then it is what we 
have to live with. As I said earlier, the process we go through 
to satisfy requirements to make us safe, Senator, we will go 
through that process. What will suffer in the short term, in 
particular, is schedule. If you cannot get there, there is not 
enough money for overtime or you do not have enough people, you 
just do it at a slower rate, but you still do it in a safe 
manner. And safety always is number one.
    So, from my point of view as the contractor with the people 
who do the hands-on work, if I am given some budget challenge 
that I did not expect, whether it is $20 million, $30 million, 
$40 million, or $50 million, then I will have to figure out 
what to do with that.
    Now, as a service contractor, most of my budget is in 
people, and so I do not have very much flexibility to not buy 
parts and put them on the shelf or delay the development of 
something. Because the vast majority of my resources are spent 
on people doing things, as I mentioned earlier, over the years 
I have gotten to be an expert in how to do layoffs whether I 
wanted to or not. So, if we are told to eat some unanticipated 
amount of money, then we will just go deal with that, and it 
will impact the work force predominantly in Florida and Texas.
    Senator Nelson. I want to show you a chart and I want to 
talk about it. You all are quite familiar with this chart. This 
is before Challenger when the risk was 1 in 25 because the 25th 
flight blew up. Post Challenger, with the upgrades that were 
made, the catastrophic risk on ascent is 1 in 78. You all 
upgraded that to 1 in 248. It has now been upgraded to where we 
are now to about 1 in 483. The idea was to double that to 1 in 
1,000. Again to compare, Mr. Readdy, with what you said, a 
Boeing 777 is 1 in multiples of thousands. I think you said 
20,000.
    Mr. Readdy. A combat aircraft, 20,000; and a commercial 
aircraft, 1 in a million.
    Senator Nelson. One in a million; a combat aircraft, 1 in 
20,000.
    So, we are just trying to get the Space Shuttle on ascent 
to 1 in 1,000. But you have got to do these things. So, let us 
go through these, let us talk about them, and let us see if we 
can get some sense--and I invite all of you. I cannot thank you 
enough for all of your participation today because you bring 
your particular expertise to the table and it is very valuable. 
So, let us talk about it.
    The orbiter avionics/cockpit safety upgrade. If you got 
into an emergency landing, return to the site of launch, RTLS, 
or a trans-Atlantic abort, for that commander and for that 
pilot, it would sure be nice to have that, would it not?
    Mr. Readdy. Yes, sir. And this is what we have today. We 
have got checklists on velcro that we put up in the window. You 
know these because you flew them, and they have not really 
changed much other than the procedural steps since STS-1. But 
that is what we have at our disposal to fly our Mach 25 rocket 
ship.
    Senator Nelson. What are we talking about in cost for that 
and over what period? What are we looking at for the first 
cost?
    Mr. Readdy. Well, we will get you the precise numbers, 
Senator.
    Senator Nelson. If I recall, it is about $380 million, and 
that is over some period of time. You would be talking about 
$60 million in 2002.
    Mr. Readdy. The rough order of magnitude that we submitted 
in November 2000 was between $400 million and $500 million to 
implement that upgrade, sir.
    Senator Nelson. Do you want to assign a percentage to that 
of all these upgrades to double the safety or, to describe it 
another way, to half the risk? Do you want to assign a 
percentage to that of how important that is to us?
    Mr. Readdy. Well, in terms of operation of the Space 
Shuttle, when we do our quantitative risk assessment, we use 
the crew as a reliability of 1.0. The crew always makes perfect 
decisions. The ground always makes perfect decisions because we 
model only the hardware aspects of it. So, the cockpit is one 
upgrade that gives the ground control and the flight crew on 
board the decisionmaking aids to be able to crisply decide 
among what the different abort options are among the systems.
    For example, on STS-93, the crew had a momentary indication 
on a caution and warning panel, but the crew did not really 
have any idea what sub-bus, what other systems were affected 
until the ground, with literally dozens of flight controllers, 
could assess the situation and send up not only what had failed 
but what the corrective action should be. The crew did not have 
the situational awareness to be able to deal with that on 
board. That is what we are trying to provide.
    Mr. Blomberg. Senator, if I may.
    Senator Nelson. Yes, please, Mr. Blomberg.
    Mr. Blomberg. I do a lot of work in cockpit displays of 
various aircraft. The Space Shuttle is the fastest vehicle that 
humans fly. So, things happen most quickly. Decision making has 
to go on most quickly. And it has the lowest level of 
situational awareness of any vehicle I have ever seen. So, 
perhaps that will put it in context for you.
    Senator Nelson. Yes. This is year 2001 and the Space 
Shuttle started to be developed in the year 1971. It is 
basically 30-year-old technology. And in order for it to fly 
for another 20 years, it is going to need to be upgraded.
    Mr. Blomberg. And it is 30-year-old technology that was 
barely adequate for just under Mach 1, and we have a hypersonic 
vehicle.
    Senator Nelson. All right. Let us talk about some more. The 
electric APU. Right now you have an APU that has all of these 
explosive materials. You call them hypergolics. That adds 
additional risk. What you would like to do is to make that APU 
electric and, therefore, take out that explosive risk. As you 
said, you are having difficulty developing the batteries and to 
get the batteries down into a sufficiently small size and small 
weight. What would you assign to that as a percentage of risk 
so that we can half the risk for the Space Shuttle?
    Mr. Readdy. As memory serves here, that was about 15 
percent of the total Shuttle risk, and that winds up being the 
highest risk driver on the Space Shuttle orbiter vehicle.
    Senator Nelson. 15 percent of the overall catastrophic 
failure risk, but in the orbiter risk, it brings the risk down 
from 30 percent to less than 5 percent. This is a costly item, 
is it not?
    Mr. Readdy. Yes, sir.
    Senator Nelson. It started out at about $224 million, and 
now the costs keep escalating.
    Mr. McCulley. It is important to note on that particular 
upgrade, that that also has tremendous implications for the 
ground processing team, in addition to just the flight, because 
dealing with the hydrazine fuels requires a self-contained 
breathing apparatus. It requires safety considerations that 
slow down the overall process. So, that upgrade, more than any 
of the others on there, definitely affects the ground systems 
as well as the flight systems.
    Senator Nelson. Speaking of that, when I get back from 
voting, Mr. McCulley, I wish you would remind me. I want you to 
tell the story about what happened in the orbiter processing 
facility with regard to the hypergolics and how it could have 
blown up the whole Shuttle and the orbital processing facility, 
just another example.
    In this particular case, if we are doing this, we are not 
just doing it for the Space Shuttle. We are doing it for the 
future manned space vehicle that ultimately in 20 years or so 
is going to take over the Space Shuttle. These are technologies 
that are going to be applied for the future. Is that correct?
    Mr. Readdy. Yes, sir. We should never commit to building 
another human space flight vehicle that we have to process that 
has hypergolic propellants.
    Senator Nelson. Let us talk about the main engine.
    Mr. Blomberg. Excuse me, Senator. Could I just also add?
    Senator Nelson. Please, yes. All of you interrupt any time, 
please.
    Mr. Blomberg. If we are going to fly the Space Shuttle to 
2020 or beyond, as we believe it will be, the current APU's 
cannot support. They will wear out. There will have to be an 
investment in APU's one way or the other. So, the issue is--and 
I do not know the numbers--do you buy more of the current APU's 
from a vendor who may or may not still have the capability or 
do you upgrade? It is not purely an upgrade. There is an 
obsolescence issue and a wear and tear issue here also.
    Senator Nelson. And you underscore the point, are we going 
to have human space flight or not? And if we are, as you point 
out, Mr. Blomberg, it is getting to be obsolescent, and for 
that reason alone, you are going to have to change.
    All right. I am down to 2 minutes to vote. What I am going 
to do is recess the hearing. I am going to go over and vote and 
come right back. The next thing we are going to talk about is 
the main engine advanced health management.
    [Recess.]
    Senator Nelson. The Subcommittee will resume.
    Let us resume discussing these upgrades. The main engine 
advanced health management. Mr. Readdy?
    Mr. Readdy. Yes, sir. Our quantitative risk assessment 
shows that that would be about a 19 percent decrease in ascent 
risk.
    Senator Nelson. And how much of a cost is that? It looks 
like it is about $155 million?
    Mr. Readdy. Phase I of that is $27 million, and Phase II of 
it--excuse me. That is the remaining. Phase I is $55 million 
and Phase II is $100 million, sir.
    Senator Nelson. And that upgrade is done over how long a 
period, just approximately?
    Mr. Readdy. About 5 years, sir.
    Senator Nelson. Let us talk about the main engine Block 
III. That is under study. You told us a little bit about that. 
Tell us some more.
    Mr. Readdy. Yes, sir. Well, I think you have been provided 
the ascent risk breakdown with the icons associated with all 
the different elements. If you look at the one that says SSME, 
our current engine configuration shows the cluster of three 
main engines at 1 in 1,000.
    Then as you march up and left on that chart, the next 
highest risk element is the high pressure fuel turbo pump, 
which we have just flown on STS-104 and are planning to fly 
again here on STS-108 at the end of November.
    We have already implemented the next element, which is the 
high pressure oxidizer turbo pump, and if you continue up and 
left on that line, the large throat main combustion chamber we 
have implemented. The main injector we have implemented. The 
fuel preburner we have implemented.
    And the next item up there, right about the middle of the 
chart, is the nozzle. That is really the core around which the 
Block III main engine would be built. That is the single 
element in the main engine that has not received any upgrade 
over the time since we have been flying STS-1. So, that would 
be what we would build the Block III main engine around.
    Unfortunately, Colonel O'Connor talked about over $1 
billion invested in bringing the Block II engine to fruition. 
We also think that a Block III main engine would probably also 
be on the order of over $1 billion to develop.
    Mr. Readdy. But there again, Senator, if I could point out 
that the propulsion specialist on our panel, who is the former 
head of the SSME program for NASA, has expressed great concern 
about the ability of the current nozzle to last throughout the 
entire program. So, there is an issue here again of either a 
need to acquire more nozzles and reinitiate the manufacturing 
capability or develop a new one. You are not going to get there 
with the current resources.
    Senator Nelson. Well said.
    Mr. Readdy, that is over what kind of period for Block III?
    Mr. Readdy. That would be least 5 years in development. The 
past track record on the pumps has been it could take as long 
as 10 years.
    Senator Nelson. And that is roughly about a $400 million 
program up to $1 billion, did you say?
    Mr. Readdy. I think $1 billion would be a reasonable 
estimate based on what the pumps have cost, sir.
    Senator Nelson. Are there any of these others that you want 
to comment on?
    Mr. Readdy. Well, once again, looking at our stack-up of 
risks, the other element that we did want to look at was the 
solid rocket booster thrust vector controller. Right now that 
is the one that is shown with the icon for the solid rocket 
booster that says HPU. That stands for hydraulic power unit. 
That is, in essence, an APU for the orbiter that has a lesser 
duty cycle, and there are two of them per solid rocket booster. 
They operate for about 2\1/2\ minutes and then, of course, they 
splash down in the Atlantic, get dragged back to Florida, 
refurbished, and used again. But it has the same toxic, 
flammable propellant (hydrazine), the same high temperature 
environment, the same kind of rotating machinery that goes 
around at 80,000 rpm or more. So, we would hope to retire a 
similar amount of risk in that area.
    Senator Nelson. And would that be replacing the hydrazine 
with electric?
    Mr. Readdy. In this particular case, because it has got a 
lesser duty cycle of only 2\1/2\ minutes, instead of 8\1/2\ 
minutes in ascent and an hour plus on entry, our proposal right 
now would be to use high pressure helium, which is an inert 
gas, as the motive agent instead of hydrazine. Helium, of 
course, is nontoxic, nonflammable.
    Senator Nelson. This reduces the SRB failure by about 21 
percent.
    Mr. Readdy. For the SRB, that may be correct. For overall 
ascent mission risk, it would be about a 9 percent 
contribution.
    Senator Nelson. It is roughly a $200 million item?
    Mr. Readdy. Yes, sir.
    Senator Nelson. Now, Mr. Readdy, did you have a chart that 
you wanted to show us on this same issue?
    Mr. Readdy. We affectionately call that particular chart 
the ``Volkswagen'' chart. You see kind of the streamlines as it 
goes up.
    Really the attempt there was to illustrate where we are now 
and what the possibilities are. We do not have a precise number 
because these are all probabilities. We have got a range of 
numbers that go up vertically there.
    Senator Nelson. You have a chart on the Space Shuttle 
program historical budget that you wanted to show us.
    By the way, we will enter into the record the Block II 
configuration ascent that we have just gone over.
    [The charts follow:]

    
    
    
    
    
    
    
    
    
    
    
    
    Senator Nelson. Please.
    Mr. Readdy. Yes, sir. I think this really speaks to Senator 
Allen's original question, credibility in terms of cost 
estimation. I think even though we would not characterize our 
vehicle as operational in terms of the relative risk, we would 
certainly characterize the program as operational in that we 
know, to a pretty large degree, what it costs for the hardware 
and what it costs for the people to run the program.
    What we have done here is we have put it in current year 
dollars and adjusted it backward for inflation and then forward 
we have discounted the dollars to show the effect of inflation 
on our budget. Our current budget in real year dollars is a 
constant $3.2 billion. This shows the upgrades wedge that you 
all initiated, and it also shows what is resourced for six 
flights per year in the current budget.
    Senator Nelson. Does anybody else want to comment on the 
chart?
    Mr. McCulley. Well, Senator, I would repeat what I said 
earlier that it is that profile that has me greatly concerned 
because as an almost people-only contract, the only way to 
achieve those numbers is to reduce staff by significant 
numbers, which is not only painful but dangerous to the long-
term health of the program.
    Senator Nelson. Mr. Blomberg, you were shaking your head.
    Mr. Blomberg. I was shaking my head, Senator, because just 
the thought of reducing any of the people right now would mean, 
almost with certainty, that certain critical skills would be 
eliminated from the program and risk would just go out of 
sight.
    That curve is really almost the mirror image of what it 
should be for a vehicle of this age. At this point in time, 
there should be an increased investment in the vehicle to bring 
it back to the operating state that it had when it was new and 
to apply modern technology to reduce risk.
    I think there are two stages, as I mentioned, that you have 
got to go through. One is let us make sure we are holding our 
own and we have a vehicle that is as capable as it was when it 
was new or, in this case, when it was redesigned after 
Challenger. And then let us see what makes sense to improve the 
reliability and improve the safety of the vehicle above that. 
You cannot do that with a funding profile like that. That is 
just the opposite.
    Mr. McCulley. Richard, I would only comment that 
``vehicle'' is too narrow a term because you need to include 
the whole system.
    Mr. Blomberg. I agree with you completely.
    Senator Nelson. Right, which is an excellent reminder that 
you have got a force of people who are trained who are 
experienced, and if you do not have that and you have to lay 
off people, then it takes you a long time to accumulate that 
kind of experience as you would ramp up in the future.
    Take this opportunity, Mr. McCulley, to tell them about 
what happened a few years ago and how the orbiter processing 
facility, along with the orbiter, could have gone sky high.
    Mr. McCulley. One of my reasons for being such a big fan of 
those two upgrades that dealt with the auxiliary power units--
one of them would be replaced by helium; the other would be by 
electric--is that the very things that make those fuels work so 
well in orbit also result--you really have a controlled fire 
going on in those in the back.
    But in the ground processing system, you have valves that 
leak and heaters that fail and things of that nature. So, you 
routinely have to work on those orbital maneuvering system pods 
and in and around those hypergolic fuels and the hydrazine on 
the auxiliary power units.
    But the incident to which you are referring was we were 
working on OMUS pod on Endeavor in OPF processing facility bay 
1, 3, or 4 years ago, and the techs and inspectors, who were in 
the protective gear--and we had the bay cleared--opened the 
line up that they thought had been cleared of fluids but it was 
not. These things are self-igniting. So, second shift, 
everything is cleared out of the way. These three guys found 
themselves up inside a very confined space with an uncontrolled 
fire in their face.
    They had a couple of options at that point. One was to run, 
and nobody would have faulted them for that because they were 
working with something that could have exploded 
catastrophically very quickly. It was all caught on tape 
because we have these video cameras that run as a safety and 
security issue. So, we were able to watch this thing take place 
the next day. It was absolutely incredible the way these three 
men responded to that fire.
    They were wearing gloves. But one guy was beating the fire 
out with his hands, which were gloved. In the meantime, one of 
the other guys got the nearest water bucket that he could get, 
and the third guy got on the phone. They each did a part that 
was there. And the end result was they put the fire out in 
about 25 or 30 seconds, and the damage was minimal. Actually 
there was more water damage than there was heat damage, the way 
it turned out.
    But it points out what you wanted to point out that there 
is not just flight hazards associated with these types of 
fuels, there are also ground hazards that we have to deal with. 
It puts our folks in a hazardous environment, and that by 
definition makes it a more expensive and less efficient 
environment. So, this particular set of upgrades not only would 
make life safer on the ground and in the air, but it would also 
greatly increase efficiency and your ability to manifest and 
schedule.
    Senator Nelson. Let us talk about some of the upgrades for 
the infrastructure and why that is important. One of the 
obvious things, there was a hurricane that was headed straight 
for the Cape about 2 years ago, and thankfully it turned. Yet, 
some winds did hit the Cape and blew off some panels of the 
Vehicle Assembly Building or VAB. The continuing assault of 
corrosion, as well as, I understand, other things that have 
been there since the Apollo days that simply are going to have 
to be updated. Share with us what you know about all of that 
and how does that fit with the overall safety that we are 
looking at here and the efficiency.
    Mr. McCulley. First of all, from a Shuttle program point of 
view, it is far more than just a Kennedy problem. The Johnson 
Space Center has a huge number of facilities that are devoted 
to the Shuttle program, simulators, trainers, mock-ups, a 
number of things, that also require periodic upgrading or 
repair and maintenance. The Stennis Center in Mississippi has 
propellant barges that, like all ships, need refurbishment that 
has been put off. They have water pumps that are out on the 
test stands that need work. The Marshall Space Flight Center 
has a number of areas that need work. Then, as you mentioned, 
the Kennedy Space Center, the most visible, of course, is the 
vehicle assembly building.
    These are facilities that were built many years ago. We 
have done the required maintenance over the years, and that is 
evidenced by the fact, as I said earlier, we launched 8 times 
in the last 11 months and we had no failures of things like 
fuel pumps that pump the fuel into the vehicle, heaters, 
electrical switch boxes, RF transmitters, any of those things. 
So, the facility is working but it is working primarily because 
we are just doing what has to be done and we are not doing as 
much of what you would like to do so that it is still there 10 
years from now to protect.
    Some of it is things like 1970's technology-based, oil-
based circuit breakers that can get hot and can explode, and 
the technology today would allow you to be much further along. 
Those sort of upgrades are not very glamorous, certainly 
nothing like putting a new main engine or some sort of fancy 
cockpit in, but they are just as important for the long haul.
    Senator Nelson. Does everybody agree with that?
    Mr. Blomberg. Definitely, and I would just add another 
example that happens to be at the Kennedy Space Center. But the 
data cables that run out to the launch pads are in just a 
horrid state of repair. They are being Band-Aided. They have 
been working fine. People are doing as much as can be done with 
them, but the bottom line is they need to be replaced. They 
could be replaced with fiber optics or modern technology and 
become much less of a worry. If they fail at the wrong time, a 
smart failure as we call it, it could be a very serious safety 
issue.
    Senator Nelson. I would like to get your opinions on the 
record. Since we have concentrated on the Shuttle safety, now I 
would like you to put on the record your opinions with regard 
to the threat with the safety to the International Space 
Station. If the Shuttle is grounded, obviously we have got a 
problem except for the crew escape vehicle. But what are some 
of the other things that would imperil the Space Station vis-a-
vis Shuttle safety and these upgrades?
    Mr. Readdy. I think our mission in the Space Shuttle 
program is to provide safe, reliable, sustainable, human-rated 
space transportation during the International Space Station 
era. Those things which allow us to do that, of course, are 
very important. We have got Captain Frank Culbertson and his 
crew orbiting right this minute on International Space Station. 
Pretty soon there will be a year of continuous crew on board 
International Space Station. We expect to do this for the next 
15 years. Without the Space Shuttle to provide crew rotation, 
to provide logistics, to provide repairs and a platform to be 
able to do further assembly, it does put that investment in the 
International Space Station at risk and it causes further 
reliance on our Russian partners in terms of the Soyuz vehicles 
for crew up and down, for crew rescue and progress vehicles for 
crew resupply.
    Senator Nelson. Any other comments? Mr. Li?
    Mr. Li. Yes, sir. While the Shuttle is extremely important 
for servicing the Space Station, I think that the alternatives 
obviously that are available to us--they might not be the ones 
that we would want to use--are indeed more reliance on the 
Russians and perhaps reliance on the Europeans. They are 
developing an ATV vehicle that will provide that sort of 
replenishment.
    But I am reminded, when I think about what the Shuttle has 
done recently, that there have been situations where the 
Shuttle was extremely useful in helping out the Space Station, 
for example, when they had difficulty with the air conditioning 
and they were actually using the air and the oxygen from the 
Space Station. There was that incident where to boost it to a 
higher orbit, they used some of the propellant and used some of 
the power from the Shuttle.
    So, I think there are those instances, but I think that we 
have to take a look at the Shuttle as not being the sole 
provider for being able to help the Space Station.
    Mr. Readdy. In terms of harvesting that investment that we 
have made in the International Space Station, the other thing 
that the Shuttle provides is the research up and the research 
down from the Space Station. That harvest occurs because the 
Space Shuttle is able to take up those racks that are full of 
experiments, those materials that are used in those 
experiments, and also has the capacity to bring them down to a 
soft landing.
    Senator Nelson. In other words, to put this in investment 
terms, everything that we have got invested in the Space 
Station is going to be dependent upon a workable, safe, and 
reliable Space Shuttle to get to and from the Space Station.
    Mr. Readdy. Yes, sir.
    Senator Nelson. I would like your opinions, so that we can 
get on the record and clarify in people's minds what was 
conceived to be the follow-on vehicle to the Space Shuttle--I 
think it is referred to as the Space Launch Initiative. I wish 
you would tell about how that all has been delayed and set 
aside and how that is not likely to come for some period of 
time, but that in upgrading the Space Shuttle, you are also 
starting to do your advance, your planning, your design that 
can be incorporated in the Space Launch Initiative so that 
ultimately we have the follow-on vehicle. Mr. Readdy, and I 
would like to go right down the panel.
    Mr. Readdy. Well, I think Allen Li has recently testified 
on SLI, but from the Space Shuttle standpoint, we really 
enthusiastically support the Space Launch Initiative and the 
goals to provide a next generation vehicle. The Space Shuttle's 
20 years of service, though, should be the launching platform 
because we wind up being a pathfinder for very many of these 
technologies because we can provide the test bed that takes 
them to the relevant environment and back.
    Also, the lessons that Mike McCulley was talking about in 
terms of the vehicle processing. We always look at T-O, which 
is lift-off, to wheel stop, landing. That is only 10 percent of 
what happens in a reusable spacecraft's life cycle. Ninety 
percent of that time right now is spent in vehicle processing 
for the next mission. That is one of the lessons that we need 
to learn. Part of that is driven by the fact that we have toxic 
propellants. Part of it is driven by the fact that it was such 
a cutting edge endeavor to do in the first place that we had to 
shoehorn things into a vehicle rather than a priority to make 
them maintainable. So, the maintainability, the reliability 
aspects need to be engineered into the next generation vehicle. 
Those technologies need to be started right now.
    The 777 enjoyed, from the tip of the nose to the tip of the 
tail, the benefit of research that was done 20 and 30 years 
earlier in digital fly by wire flight control, super critical 
wing, composite primary structure, glass cockpit, high bypass 
turbo fan engine technology, et cetera. What we need to do is 
have the analog to that that will allow us in the next decades 
to build the next generation of vehicles.
    Senator Nelson. Mr. Li?
    Mr. Li. Yes, sir. The Space Launch Initiative that you 
referred to was really the latest reincarnation of what they 
have been trying to do. But if I can turn you a few years back, 
there was a recognition of the fact that the Shuttle, even 
though it is the only game in town, is a very expensive game in 
town.
    That said, there was a need to be able to reduce the cost 
of sending payload to space from the $10,000 a pound that we 
currently pay on the Shuttle to maybe $1,000 a pound. The 
thought is, once we can bring it down to that level, we are 
going to be able to expand economies of scale, people will be 
interested, and it will suddenly be economical to send things 
up in space, and it will generate all these good things.
    That said, a few years ago, NASA decided to embark upon an 
experiment with industry in a cooperative agreement with 
Lockheed Martin, who won competitively. It was a situation, 
Senator, where NASA in essence said we are going to put $900 
million on the table and you put about $200 million something. 
With that amount of money, you go out and build the X-33 
demonstrator. Well, as you perhaps know, that experiment was 
not successful.
    One of the foundations of them feeling and being optimistic 
that that would work was that they felt that industry was going 
to be able to reap some benefits from the development of an 
RLV. They thought that tons of satellites would be launched and 
that the commercial sector would be willing to take advantage 
of that. But as you know, with the demise of things like 
Iridium and Teledesic, that did not happen. As a result, 
industry was not willing to fork over the additional amounts of 
money that would be required for the X-33 to continue.
    The SLI process that you were referring to is the current 
one that NASA has, and they have about $700 million of 
contracts. Those contracts will go about reducing risk. They 
are not developing a vehicle. They are just coming up and 
identifying individual technologies. And that is what they are 
doing right now. They are hoping that by the 2006 timeframe 
they can make a decision on whether or not to go forward. But 
as I said in my statement, Senator, I think that having that 
2006 timeframe and not knowing how long you are going to have 
to keep the Shuttle operational is a real difficult task that 
people like Mr. Readdy have to deal with.
    Senator Nelson. Just to underscore that, what you had said, 
Mr. Readdy, earlier it took 10 years and $40 billion to develop 
the Space Shuttle and you compared it with some other programs 
that were developed.
    Mr. Readdy. Yes, sir.
    Senator Nelson. What were they?
    Mr. Readdy. Well, that would be one end of the curve which 
is the first generation reusable launch vehicle. The other end 
of the curve--and I shamelessly pirated this from Norm 
Augustine's book Augustine's Laws--would be the 777, which 
Boeing would admit to $12 billion of their money tied up for 6 
years to develop.
    So, somewhere on that continuum is what it takes to do 
aerospace hardware. I guess my first order cut on it is it is 
probably somewhere in the middle, maybe more toward the Mach 25 
end of it rather than the .85 end of it, not the subsonic end, 
but the hypersonic end.
    Also, just to amplify what Mr. Li said. We talk about cost 
per pound to orbit, but the unit cost is not cost per pound. 
The unit cost is cost per launch. In the Apollo era, those 
launches were about $10 billion to $11 billion per launch. If 
you just take the Shuttle budget and divide it by our flight 
rate, right now it is on the order of about a half a billion 
dollars per launch, which is expensive, but it is on the same 
order as the Titan IV launch vehicle and it has the reliability 
of about 1 in 20 for similar lift capability compared to our 
launch reliability.
    Then the final thing is where we would like to get to in 
terms of human-rated space transportation is where Herb 
Kelleher is in Southwest Airlines, and he does not charge by 
the pound either.
    Senator Nelson. Well said. And when you add in the factor 
of how many billions of dollars that we have spent on the 
International Space Station that we are now assembling and the 
ability to use that asset, recognizing that the follow-on 
launch vehicle is going to be some number of years down the 
road, then you have got to provide an access to space to the 
Space Station. And we best get about the process of making this 
one as safe as we can for the future.
    Now, my hat is off to you, all of you, for what you have 
done in the reliability and the increased safety that you have 
given to this point. With what you have done over 10 years of a 
declining budget in real dollars--that is overall NASA, but 
what you have done in a Space Shuttle budget with 40 percent 
less money over that decade is nothing short of miraculous to 
have the kind of safety record that you have today. But that is 
not going to continue for the future, and that is the whole 
point of us getting together today.
    I was able to see Senator Bond on the floor when I went to 
vote. I grabbed Senator McCain. Those were the two that I 
grabbed and gave them a little bit of a vignette of what we 
have been talking about today, and I will continue to do this 
as we get ready to make the appropriations decisions on down 
the line.
    Does the staff have any more questions that you want asked? 
OK.
    We are going to keep the hearing record open for two weeks 
for any additional comments. Do any of you all have any 
additional comments that you would like to make?
    Mr. Li. I would like to say something about lessons 
learned, Senator. I do not think I will be here 30 years from 
now, but if I were 30 years from now sitting at this table, I 
would not want to be in a situation where there was an 
operational RLV and we had the similar types of problems where 
we had to do upgrades. I want to go back to perhaps why this is 
happening.
    I believe that the Shuttle was developed not with 
supportability and maintainability in mind, and I think that is 
what we have to do. If we go to a future vehicle, let us start 
thinking about building something that we can maintain, 
something that we can use every day, something that we do not 
require an army to take care of. Let us not shortchange that 
part of the process.
    Senator Nelson. Well said.
    And on the same issue of lessons learned, I deem it a great 
privilege to have the opportunity to be here now representing 
the State of Florida, and there were some lessons that I 
learned. And it is absolutely obligatory on my part, now that I 
sit as a Member of this Committee, to try to pass on those 
lessons learned, for that was a very painful time in January 
1986, only 10 days after our flight had returned to earth and 
which almost happened to us what happened 10 days later. So, I 
just deem it a great privilege to be here and to try to speak 
out.
    Mr. McCulley?
    Mr. McCulley. I told you earlier off the record--and I 
would like to say it again now on the record, and that is to 
thank you for bringing your interest and your expertise and 
having us here today and giving us a forum to express our 
concerns and with some confidence now that you can go do battle 
perhaps armed a little better than you were before. So, thank 
you very much.
    Senator Nelson. Indeed. You all have brought excellent 
testimony to the Senate today, and I thank you.
    The meeting is adjourned.
    [Whereupon, at 5:04 p.m., the Subcommittee was adjourned.]

                            A P P E N D I X

  Response to Written Questions Submitted by Hon. Ernest F. Hollings 
                          to William F. Readdy

Budget
Question 1. NASA has stated that due to cost growth its FY 2002 Space 
Shuttle budget would have a shortfall of $218 million. In briefing the 
Committee, NASA has identified $185 million in cost savings but was 
unable to address the remaining $33 million because costs are still in 
flux. Does NASA have a better grasp of how much the FY 2002 budget 
shortfall will be? Has NASA identified cost savings, which offset the 
entire amount of the shortfall?
    Answer. NASA identified the FY 2002 Space Shuttle budget shortfall 
to be approximately $218 million. Changes to the outyear flight 
manifest reductions to a flight rate of four Shuttle missions per year 
may yield some modest additional savings in FY 2002. Additional program 
content adjustments may also be necessary to offset the entire amount.

Question 2. NASA is funding Shuttle supportability upgrades at about 
$100 million annually. However, cost growth on the Checkout and Launch 
Control System at Kennedy Space Center has reached the point that it 
almost consumes the annual funding for all supportability upgrades. How 
does NASA plan to fund other needed supportability upgrades in the 
future?
    Answer. Although the Checkout and Launch Control System (CLCS) has 
experienced cost growth, it does not consume the annual Supportability 
Upgrades funding in the FY 2002 President's Budget. CLCS represents 
less than half the Supportability Upgrades budget for FY 2002, with a 
steady decline to less than 10 percent of the budget by FY 2006.
Orbiter Major Modifications
Question 3. The orbiter Discovery (OV-103) was scheduled for an OMM 
later this year. But NASA has proposed that, due to severe budget 
limitations, the OMM scheduled for the orbiter Discovery had been 
deferred and a more cursory ``structural inspection'' would be 
performed at the Kennedy Space Center in Florida. What are the 
differences between these two types of inspection? Will the structural 
inspection allow for the same level of safety that the OMM would? 
Please explain.
    Answer. During an Orbiter Major Modification (OMM), at a minimum, 
major safety upgrades and structural inspections are performed on the 
orbiters and would be performed on Discovery irrespective of the 
location of the modifications. At this time, NASA is still assessing 
the pros and cons of both sites. The Office of Space Flight expects to 
decide the content and location by the end of CY-2001.

Workforce Issues
Question 4. Last year, GAO noted that training of new hires was a 
challenge facing NASA. Given the extent, to which the agency has 
recently added new hires to the workforce, what specific plan has NASA 
adopted to ensure that these workers are properly trained?
    Answer. As a result of beginning to hire new employees and fresh-
outs, the NASA Centers have instituted, or have begun to revitalize, 
various orientation and other training programs designed to assimilate 
new employees into the workforce and provide mentoring and career 
development guidance. Many programs also include the requirement for 
specific types of training (e.g., technical or administrative), and 
include both on-the-job and developmental experiences over a period of 
time. Components in many Centers' training programs also provide for 
guidance to supervisors in designing a training plan or individual 
development plan, providing mentoring and coaching, and evaluating work 
products and progress. The goals of these programs are to aid in the 
smooth and effective integration of new employees into the Center and 
Agency workforce. This will be accomplished by: providing a continuing 
and accelerated learning process; providing employees a way of 
identifying with the Center by understanding its mission and values; 
providing interaction with more senior staff and leaders; and, 
providing opportunities to develop relationships with peers. At the 
Agency level, efforts are being initiated to establish a network of 
experienced practitioners who can provide mentoring and access to 
expertise in project management.
    At the Agency level, resources have been requested to enable NASA 
to expand the delivery methods being utilized to develop the workforce. 
Specific emphasis is being placed on the development of e-learning 
alternatives that can be accessed at all locations and levels, and 
increasing the ability to expand participation levels across the 
Agency. In addition, new capabilities are being developed to facilitate 
learning within intact teams, delivering tailored content directly to a 
project team at the point in time specific training is needed. In 
addition, some Centers have also increased their resources available 
for training, and are instituting Center specific initiatives based 
upon Center needs. In addition, learning organization tools and methods 
being introduced in pilot projects within NASA are increasing 
organizational understanding, motivation, buy-in, and results. Examples 
of new initiatives include web-based course delivery and partnerships 
with universities for academic training.

Infrastructure
Question 5. In testimony before the Committee, Mr. Mike McCulley from 
United Space Alliance stated that we can no longer wait to begin 
infrastructure improvements. Why has NASA not included these projects 
in its annual budget request? Will the FY 2003 budget request begin to 
address this issue?
    Answer. The President's FY 2002 budget request for NASA's Space 
Shuttle Program (SSP) assumed a flat budget, across the entire budget 
horizon, with assumed productivity offsets for inflation and other 
increased requirements. Over the past several years, the SSP has 
aggressively pursued, realized and exhausted operational and 
productivity efficiencies. To operate with a flat budget profile the 
Program must continually find productivity offsets for inflation and 
other increased requirements. As a result of operating in this 
environment, the Program has only been able to sustain a minimal 
maintenance schedule. The Shuttle program has determined infrastructure 
requirements necessary to support the Shuttle Program until 2012 and 
plans to address these requirements in future budget requests.
    Because of a desire to limit growth of the Space Shuttle budget, 
the program has included a minimal maintenance schedule. The Shuttle 
program has determined infrastructure requirements necessary to support 
the Shuttle Program until 2012 and these requirements are being 
considered in preparation of the FY 2003 budget request.
Long-term Vision for Human Space Flight
Question 6. What is the long-term vision for human space flight now 
that the X-33 has been canceled? and cost overruns of the International 
Space Station are putting tremendous pressure on the budget? When the 
Shuttle is retired, what will the next generation space vehicle look 
like and be capable of? What is NASA doing to build that vehicle?
    Answer. X-33 was an unmanned, suborbital technology demonstration 
project aimed at paving the way for an unpiloted, commercially-
developed Lockheed-Martin Venture Star reusable launch vehicle. NASA's 
role in the follow-on Venture Star vehicle would have been to provide 
requirements and funding for `human-rating' of the vehicle.
    NASA is dedicated to assuring the nation continues to play a 
leadership role in human space flight. Despite International Space 
Station fiscal challenges, NASA remains committed to NASA's Space 
Launch Initiative (SLI) program. SLI is targeted at investing in the 
technology that offers the greatest potential to reduce the technical 
and business risk associated with the design, construction, and 
operation of the next generation reusable launch vehicle architecture 
to support human space flight and other NASA missions. The makeup of 
that architecture is being defined through a competition among 
industry's best ideas.
    SLI investments are expected to lead to commercially developed and 
operated Earth-to-orbit vehicles/systems, combined with unique 
government assets that can meet NASA's human and robotic needs as well 
as commercial and military space access requirements. Recent SLI 
contract awards have committed approximately $750 million in funding as 
an investment in technology development and demonstrations for various 
critical technology drivers. Additional awards are expected next year. 
The Program will mature these technologies over the next several years 
to allow selection of at least two competing vehicle architectures by 
mid-decade with an initial operating capability early in the next 
decade.

Question 7. What will NASA's Human Space Flight enterprise be doing in 
ten years? In twenty years? In fifty years?
    Answer. As described in NASA's current strategic plans for the 
future Human Exploration and Development of Space (HEDS), the coming 
decades will enable the U.S. and our international partners to achieve 
truly profound advances in scientific knowledge, in economic 
opportunity, and in building a better future for humanity.
    In the coming decade, the Space Shuttle will continue to be 
operated safely and it will be also further privatized. The 
International Space Station (ISS) will be completed and groundbreaking 
scientific and applied research will create the foundation of knowledge 
needed to enable long-duration human space flight beyond low Earth 
orbit. Particular progress will be made in our knowledge of effects of 
long-term space flight on humans as well as needed countermeasures. At 
the same time, major new technologies will be validated in space and on 
ISS, setting the stage for a new generation of space systems and 
infrastructures opening up the Earth's neighborhood the area of space 
containing low and high Earth orbits, the moon and the Sun Earth and 
Earth-Moon Libration points) for space science, exploration and space 
development. NASA's Human Space Flight enterprise will partner with the 
science enterprises to understand and plan for the most effective 
science-driven human missions.
    In the next twenty years, the International Space Station will 
transition to largely commercial operations that will include providing 
laboratory services to the science community while major new 
infrastructures are deployed for government and commercial 
applications--opening the way for revolutionary new space missions. 
Opportunities may include the deployment of a small, human-tended 
outpost near the Moon. From such an outpost, large new telescopes might 
be built and deployed and the global exploration of the Moon by robots 
and humans might be undertaken. At the same time, transformational new 
technologies and systems (including new Earth-to-orbit transportation) 
could be developed and demonstrated--setting the stage for human 
missions to Mars and the asteroids. On these foundations, new 
commercial opportunities can emerge, including new generations of 
communications satellites, commercial power utilities in space and 
public space travel.
    Within the next fifty years, which is the same distance in time 
from the present as the present is from the earliest days of the space 
age; pursuing the current HEDS strategic plan will enable the U.S. 
economy to expand significantly into space. This will include new 
industries in low Earth orbit (e.g. space business parks and in-space 
manufacturing) and across the Earth's neighborhood (e.g. space solar 
power stations and the development of Solar System resources on the 
Moon and elsewhere). Also, new generations of lower-cost reusable space 
launch systems will be developed and deployed. The global exploration 
of the Moon and Mars by robot and human teams could have been 
accomplished--and permanent outposts on both worlds could have been 
established. The extraordinary space observatories made possible by our 
new capabilities in space will have made ground-breaking discoveries 
such as the imaging of the first Earth-like planets beyond our Solar 
System.
    Furthermore, the development of the needed technologies and 
capabilities for these goals will also have made possible the 
transformation of our goals and accomplishments in the exploration of 
the Solar System beyond. This will include sample returns from the 
outer planets, probes beneath the icy crust of their moons, and perhaps 
the first probes beyond our Solar System.

                                 ______
                                 
      Response to Written Questions Submitted by Hon. John McCain 
                          to William F. Readdy

Question 1a. In correspondence to the Committee, NASA indicated that 
the cost of the Electric Auxiliary Power Unit (EAPU) has grown from an 
initial estimate of $224 million to as much as $600 million since its 
inception in 1999.
    Can you explain this three-fold increase in such a relative short 
period of time?
    Answer. The Space Shuttle Program (SSP) encountered significant 
technical challenges with the EAPU project as the technical formulation 
phase progressed. Assumptions made for the initial estimate about the 
maturity of necessary technology, primarily the power cells, turned out 
to be incorrect, and there was significantly more technology 
development that needed to be performed. The estimate of cost to 
project completion increased due to the inability to mature the 
technology resulting in significant weight, mass, and cost growth. As a 
result, the most recent proposal was close to $500-600 million, between 
two to three times the original cost estimates.

    Question 1b. Is there a generic problem with cost estimating at 
NASA, given the type of estimate increases we have seen on other 
programs?
    Answer. According to the recent International Space Station 
Management and Cost Evaluation (IMCE) Task Force report, continued 
escalation of cost estimates are an indication of inadequate cost 
estimating methodology, tools and controls. Although a multitude of 
cost estimating techniques are used by NASA and its contractors, 
program control techniques have suffered from insufficient early 
warning analysis due to lack of experienced program control personnel, 
modern management information tools, reduced emphasis on control and 
reporting techniques, and diverse accounting systems.
    NASA is responding to this concern by taking actions to improve 
cost management and cost estimating, including shifting of NASA 
personnel to enhance its program evaluation capability. The recent 
award of the Independent Program Assessment Contract to Booz-Allen-
Hamilton/Raytheon is a step towards improving the Agency's independent 
assessment capability. The contractor will support the Johnson Space 
Center Systems Management Office in providing full programmatic and 
institutional assessment capability.
    The increases in cost estimates on Electric APU were an indication 
of a generic problem with the ability of NASA's Human Space Flight 
programs to develop cost estimates. The causes in this case were 
primarily underestimating the technological risk remaining for 
developing the unique batteries required for EAPU as well as growth in 
requirements early in the formulation phase of the project or task.

Question 2a. You stated that NASA has a milestone for a Shuttle 
replacement to achieve ``Initial Operating Capability'' at the start of 
fiscal year 2012. This seems to be a very aggressive schedule given 
that it is only ten years away.
    What firm plans does NASA have for this milestone other than the 
Space Launch Initiative, which does not guarantee an operational 
vehicle at the end of its efforts?
    Answer. ``Initial Operating Capability'' is a Space Launch 
Initiative (SLI) milestone and, as explained below, is the point at 
which the Space Shuttle operations can begin to phase down as new 
systems begin operations. The Space Shuttle upgrades will improve the 
safety of the Space Shuttle fleet until the next generation system is 
operational. NASA will assess the progress of SLI in the middle of this 
decade, and may re-evaluate Space Shuttle upgrade needs for longer-term 
requirements if it appears that 2nd Generation RLV systems will not 
reach operational capability by 2012.

Question 2b. What is meant by ``Initial Operating Capability?''
    Answer. Certification of 2nd Generation RLV systems begins in the 
2008 to 2009 timeframe with the first full-scale launch. The specifics 
of the certification process and the number of launches to certify the 
vehicle have not been defined; the vehicle type and the technologies 
used will influence the certification process. At the completion of the 
certification process, anticipated to be in 2012, the RLV system will 
be operational, reaching its ``initial operating capability'' 
milestone. At the time, Space Shuttle operations can begin to phase 
down as new systems begin operations.

Question 3. Can you explain why the NASA annual budget requests have 
not included funding for Shuttle infrastructure projects?
    Answer. The President's FY 2002 budget request for NASA's Space 
Shuttle Program (SSP) assumed a flat budget, across the entire budget 
horizon, with assumed productivity offsets for inflation and other 
increased requirements. Over the past several years, the SSP has 
aggressively pursued, realized and exhausted operational and 
productivity efficiencies. To operate with a flat budget profile the 
Program must continually find productivity offsets for inflation and 
other increased requirements. As a result of operating in this 
environment, the Program has only been able to sustain a minimal 
maintenance schedule. The Shuttle program has determined infrastructure 
requirements necessary to support the Shuttle Program until 2012 and 
these requirements are being considered in preparation of the FY 2003 
budget request.

Question 4. Of the projected $218 million shortfall in fiscal year 
2002, $35 million is from core skills and business base erosion. Can 
you elaborate on what is included in this category?
    Answer. Increases in core skills and business base erosion are a 
direct result of Rocketdyne business base declines in the production of 
major engine components. In last year's budget estimate, NASA assumed 
reductions in Rocketdyne funding consistent with production demands. In 
addition to the Space Shuttle Main Engine (SSME), other Rocketdyne 
business areas are below last year projections. Contributing factors 
are reduced demands for Delta launches, and cancellation of the X-33 
causing the resultant drop to the RS-2200 Aerospike engine effort. Many 
of the personnel supporting the SSME project did so on a part-time 
basis, while working other projects as well. Because of the drop in 
other projects, the SSME project must pay for more than the time it 
needs from key Rocketdyne staff, in order to preserve the key skill 
base. The $35 million shortfall represents a preliminary estimate of 
the cost to maintain core skills within Rocketdyne that NASA needs in 
support of the SSME project.
    NASA is pursuing alternative approaches to preserving the necessary 
skill mix at Rocketdyne. Maximum use of Rocketdyne critical skills and 
capabilities on Space Shuttle upgrade activities is being fully 
explored, particularly for Space Shuttle Main Engine health monitoring. 
The potential impact of SLI-funded propulsion activities is also being 
fully incorporated into skill mix assessments. Finally, NASA is working 
with Rocketdyne to assess how information technology could be used to 
capture critical knowledge and skills from the Rocketdyne workforce, to 
assist in training and expand the flexibility of the workforce to 
reduce the need for supporting some skill areas. NASA believes that the 
critical skills can be preserved at lower cost than the initial 
estimate if the above actions are aggressively pursued.

Question 5. How many more years is NASA planning to operate the Shuttle 
orbiters?
    Answer. NASA's current plans are to safely operate the Space 
Shuttle through at least 2012, to support the ISS for assembly and 
logistics missions, undertake non-ISS missions that require unique 
Space Shuttle capabilities, and to meet other national reusable launch 
vehicle (RLV) goals. The transition plan to a 2nd Generation RLV must 
ensure that the new system is operated effectively and efficiently 
before final retirement plans for the SSP are implemented. It is 
important to note that there is sufficient airframe margin remaining 
(70-75 missions) in the certified life of each Shuttle orbiter to 
operate the fleet beyond 2012 if necessary.

Question 6. GAO has stated in its written testimony for today that 
several upgrade projects for the Shuttle had not been fully approved 
which created uncertainty within the program, and while NASA had begun 
to establish a dedicated Shuttle safety upgrade workforce, it had not 
fully determined its needs in this area. Can you comment on these 
findings?
    Answer. The FY 2002 Space Shuttle Upgrade program budget 
requirements are currently under review by Agency management, and this 
review has been complicated by the increased budget pressures and cost 
increases to Space Shuttle operations in FY 2002. These decisions will 
undoubtedly revise plans for the current upgrades portfolio. The SSP's 
goal is to resolve these competing priorities and cost challenges as 
expeditiously as possible, thus identifying the resultant impacts to 
the upgrades planning and the upgrades workforce.

Question 7. You have spoken about NASA's use of advisory panels and the 
role they play in your management. How do you distinguish between your 
responsibilities for planning, leading, organizing, and controlling 
projects and that of advisory panels?
    Answer. NASA's responsibilities for providing direct management 
over its programs and projects are described in NASA Policy 
documentation. NASA Headquarters and Lead Center organizations 
(engineering, safety, reliability, quality assurance, etc.) generate 
specific policy and guidelines for carrying out their day-to-day duties 
as it pertains to the type of program/project being developed.
    The present NASA advisory structure consists of two top-level 
committees that report to the NASA Administrator, the Aerospace Safety 
Advisory Panel (ASAP), established by Congress to examine safety 
issues, and the NASA Advisory Council (NAC). There are eight standing 
committees that report to the NAC. One of these subcommittees is the 
Space Flight Advisory Committee (SFAC). The Council and its committees 
review the agency's policies, programs, and strategies and consider the 
degree to which they achieve their objectives. The NAC also serves as 
an additional source of reflection and consultation for the NASA 
Administrator on broad-reaching issues. From time to time, study groups 
or task forces may be asked to examine particular issues of special 
concern.
    The ASAP and the NAC and its subgroups are agency advisory 
committees and provide advice and counsel to the NASA Administrator. 
NASA also receives valuable advice from independent groups such as the 
Space Studies Board and the Aeronautics and Space Engineering Board, 
administered by the National Research Council for the National 
Academies of Sciences and Engineering. These two boards, however, are 
advisory to many elements of the Federal government and are primarily 
responsible to their parent academies. Thus, they provide their counsel 
from a different perspective than that of NASA's own advisory groups.

Question 8. You have testified that NASA has to balance funding 
priorities concerning crew safety, Space Shuttle operational 
requirements, high priority safety upgrades, and infrastructure 
projects. In this balance, infrastructure improvements are delayed 
creating a backlog. What can Congress do to help NASA more aggressively 
repair infrastructure problems and reduce the growing backlog?
    Answer. The President's FY 2002 budget request for NASA's Space 
Shuttle Program (SSP) assumed a flat budget, across the entire budget 
horizon, with assumed productivity offsets for inflation and other 
increased requirements. Over the past several years, the SSP has 
aggressively pursued, realized and exhausted operational and 
productivity efficiencies. With the continued flat-lined Space Shuttle 
budget across the entire budget horizon, it has become more and more 
difficult to manage the program within these funding constraints. The 
program has had to continue to make some difficult decisions in order 
to address requirements to maintain its primary goal to fly safely. The 
majority of the real property the Shuttle program uses is currently 
more than 34 years old. The Agency will continue to use the Space 
Shuttle as the primary human rated space access vehicle through at 
least 2012. The Shuttle program has determined infrastructure 
requirements necessary to support the Shuttle Program until 2012 and 
these requirements are being considered in preparation of the FY 2003 
budget request. It would be beneficial for the Congress to provide 
necessary budget flexibility within the Space Shuttle Program rather 
than mandating specific infrastructure projects.

Question 9. In 1999, the National Research Council (NRC) criticized 
your Decision Support System for prioritizing upgrades. What steps has 
NASA taken to create a ``clear, defensible decision process that takes 
into account all of the available evidence?''
    Answer. A separate Development Office was formed within the Space 
Shuttle Program Office at NASA's Johnson Space Center (JSC) to 
prioritize, select and fund upgrades. The role of this office is to 
select upgrades that are technologically ready for implementation. This 
Space Shuttle Program Development Office (SSPDO) manages the upgrades 
program content, and final approval of upgrades requires the approval 
of the Space Shuttle Program Manager.
    In addition, the Space Shuttle program has benefitted from the 
advice of the Space Flight Advisory Committee (SFAC), an element of the 
NASA Advisory Committee (NAC). The SFAC reviews the prioritization 
process for upgrades and makes findings and recommendations based on 
their reviews. The review and validation of the upgrades decisions by 
this advisory group adds to a clear, defensible decision process.
    The selection process for establishing the Space Shuttle Upgrades 
program content is based on prioritization of candidate upgrades based 
on rigorous systems analyses. The goal of this process is to develop 
and maintain an integrated suite of baselined upgrade projects that 
have been selected for optimal compliance with the Space Shuttle 
Upgrades program objectives. The portfolio therefore consists of 
candidate proposals undergoing initial definition and feasibility 
assessments, proposed upgrade projects, which have received formal 
approval for further definition and implementation planning, and those 
projects which have been approved for implementation and thus form the 
baselined Space Shuttle safety upgrades program content commitment.
    The following general set of criteria and considerations are used 
by the SSPDO in developing a program content recommendation to the 
Space Shuttle Program Manager and higher level approving officials:

        a)  Significant improvement to flight safety is the highest 
        priority of the Space Shuttle Upgrades program.

        b)  Significant Space Shuttle flight system supportability 
        threats must be mitigated to have a viable and reliable SSP 
        through at least 2012.

        c)  Iterative systems analysis and trade studies are used to 
        search for a set of optimal affordable combinations of safety 
        and supportability upgrades; i.e., focus is placed on 
        substantiating safety risk and supportability threats through 
        quantitative analysis, and alternate solutions are actively 
        researched.

        d)  The SSPDO strategy in case of resource conflict among high 
        priority safety improvement opportunities and supportability 
        needs is to direct in-depth trade studies on options to solve 
        the supportability threats adequately at lower cost than 
        initially proposed. For example, trades may consider adequate 
        but less comprehensive supportability upgrades, or analysis may 
        show that temporary low cost solutions may allow deferral of 
        longer term more expensive supportability solutions. In any 
        case, every significant supportability threat shall be 
        adequately addressed in the Space Shuttle Upgrades Program 
        implementation planning.

Question 10. Both the NRC in 1999 and GAO recently have questioned the 
accuracy of NASA's cost estimates, and whether they accurately reflect 
the actual costs that are incurred by programs. For example, there have 
been allegations that part of the $218 million shortfall is due to a 
deliberate NASA underestimate of contractor rate increases. How does 
NASA intend to improve its cost estimating system?
    Answer. The Space Shuttle Program's budget has been on a steady 
decline over the past several years. The President's FY 2002 budget 
request for NASA's Space Shuttle Program (SSP) assumed a flat budget, 
across the entire budget horizon, which assumed productivity offsets 
for inflation and other increased requirements that have not been 
realized due to cost increases. Since that time, NASA identified 
additional increases for the SSP totaling $218 million in FY 2002, such 
as escalation of contractor rates and health benefit increases, 
utilities increases, core skills and business base erosion, and 
increasing orbiter maintenance modification estimates. These increases 
further exacerbated pressure on the already lean Shuttle budget.
    NASA is responding to this concern by taking actions to improve 
cost management and cost estimating, including shifting of NASA 
personnel to enhance its program evaluation capability. The recent 
award of the Independent Program Assessment Contract to Booz-Allen-
Hamilton/Raytheon is a step to improving the Agency's independent 
assessment capability. The contractor will support the Johnson Space 
Center Systems Management Office in providing full programmatic and 
institutional assessment capability.
                                 ______
                                 
      Response to Written Questions Submitted by Hon. John McCain 
                         to Richard D. Blomberg

Question 1. What type of investments in the Space Shuttle do you 
believe will be needed to allow NASA to reap the full benefits of the 
Space Station?
    Answer. The Space Shuttle is the major resupply and crew transfer 
vehicle for the International Space Station (ISS). Its capabilities 
with respect to crew and payload size are unmatched by any other human-
rated space vehicle. The Space Shuttle is the only vehicle servicing 
the ISS that is capable of returning payloads and science results from 
orbit. It has also been providing significant reboost for the ISS 
thereby reducing reliance on Russian Progress vehicles. It is essential 
to keep the Space Shuttle as reliable and safe as possible since it is 
the key element in the ISS logistics chain. The Aerospace Safety 
Advisory Panel is concerned that both the safety and reliability of the 
Space Shuttle are being compromised in the long term because of lack of 
investment in four areas:

   Flight systems--Many of the subsystems of the Space Shuttle 
        are aging and likely cannot support flight at current risk 
        levels for the entire expected service life of the total 
        system. For many others, advancing technology has provided ways 
        to reduce risk significantly if improved components are 
        designed, developed, tested and certified. The Panel believes 
        that, at a minimum, significant investment above and beyond 
        current budget levels are required just to retain present 
        safety margins over the next 20 or more years. Additional 
        expenditures are warranted in areas for which risk can be 
        meaningfully reduced from those produced by the original 
        design. In both cases, it is important to recognize that the 
        long lead times involved in manufacturing current components or 
        designing and qualifying improved replacements dictate the need 
        to make investments now so that the Space Shuttle is fully 
        capable of safely meeting the flight needs for ISS support.

   Renewal of the ground infrastructure--Investment is 
        critically needed to revitalize the launch facilities, ground 
        support equipment, laboratories and test and checkout gear 
        needed to support safe Space Shuttle flights. A significant 
        portion of this infrastructure is over 30 years old, and 
        continual budgetary pressures have forced the deferral of much 
        needed maintenance and replacement. The ISS cannot be supported 
        adequately if these ground assets force a reduced flight rate 
        or a temporary grounding of the Space Shuttle. Safety of the 
        Space Shuttle can be compromised by unreliable ground 
        infrastructure. Interruptions of Space Shuttle flights would 
        also markedly impact the chance of ISS mission success. The 
        Panel believes that NASA must be able to make proactive 
        investments in ground infrastructure to prevent failures and 
        assure the availability of flight support for the ISS.

   Logistics--Providing for the timely availability of properly 
        functioning components throughout the projected life of the 
        Space Shuttle is essential to its ability to support the ISS. 
        Many items for the flight vehicle and ground support equipment 
        are not in sufficient supply to carry the program until a 
        viable replacement vehicle is qualified. Therefore, in addition 
        to making sure that flight systems and ground infrastructure 
        are as capable as possible, NASA must invest to ensure that 
        there are sufficient assets readily available to support safe 
        and effective operations for the lifetime of the Space Shuttle. 
        The Panel believes that investment both for parts and in 
        refurbishment capability is warranted.

   Workforce--The Space Shuttle is a complex system that will 
        always depend on the ability and insight of a trained and 
        experienced workforce for safe operation. Over the years, there 
        has been a ``natural'' succession of Space Shuttle leaders. 
        Experienced managers mentored younger members of the workforce 
        and prepared them to assume leadership roles. Recent staff 
        cutbacks and hiring freezes have created a gap in the ranks. 
        Future budget limitations suggest that replenishing the 
        ``understudies'' will be difficult. The Panel believes that 
        NASA should be in a position to invest in the hiring and 
        nurturing of future Space Shuttle managers. Such an investment 
        would also create a cadre from which the leaders of future 
        human spaceflight programs could be drawn just as many Space 
        Shuttle veterans received their initial experience on the 
        Apollo Program.

Question 2. You have mentioned four areas of which the ASAP considers 
critical to the long-term operation of the Shuttle: flight system 
improvements, renewal of ground infrastructure, logistics and 
workforce.
    Did the Panel place these in any order of priority for NASA?
    Answer. All four of these areas are critical over the expected 
service life of the Space Shuttle. The most immediate priority area, 
however, is likely maintaining and augmenting the workforce. This will 
provide the leadership necessary to direct the actions in the other 
three areas. Flight system improvements and infrastructure 
revitalization must also be given an immediate priority because of the 
relatively long lead times involved in their implementation. Some 
logistics actions can await decisions between the simple replacement of 
aging components and the development of improved substitutes.

Question 3. You have mentioned that any replacement for the Shuttle 
likely would not be more capable than the current system with 
appropriate upgrades. Can you elaborate on this conclusion?
    Answer. One or more major technological advances will be needed in 
order to advance the state-of-the-art of human-rated spaceflight 
vehicles beyond the level of the Space Shuttle. For example, more 
efficient propulsion systems operating at lower stress levels could 
profoundly alter both the safety and cost of placing humans into earth 
orbit.
    At present, there are no major technological breakthroughs 
available upon which a new, safer and more capable Space Shuttle 
replacement could be based. Upgrades have been identified, such as the 
electric auxiliary power unit and advanced health monitoring of the 
Space Shuttle main engines, which could improve the safety and 
reliability current vehicle. These same features would likely be 
standard equipment in any new vehicle designed today. Although they 
represent significant improvements, they are not the basis for a 
radical, new system design.

Question 4. You have mentioned the impact of budgetary constraints on 
the program. For the Advisory Panel's review of the program, did you 
find that management of existing funds was sufficient?
    Answer. The Aerospace Safety Advisory Panel is chartered to examine 
the safety of NASA's operations. When appropriate, we will highlight 
budget shortfalls that we believe have the potential to be detrimental 
to safety. We do not trace the management of existing funds to 
determine if it is sufficient. Over the likely service life of the 
Space Shuttle, however, the magnitude of the present projected budget 
shortfall appears to be beyond the ability of any management to correct 
while still flying safely and meeting program objectives.

Question 5. You have mentioned that the Panel is particularly concerned 
about infrastructure at KSC. How do the infrastructure problems at KSC 
compare to the needs at other NASA centers?
    Answer. All of the human spaceflight centers are facing similar 
infrastructure problems because the maintenance and restoration of key 
facilities has been continually deferred. The situation at KSC is of 
particular concern to the Aerospace Safety Advisory Panel because it 
has the most direct potential impact on Space Shuttle safety. Other 
centers evidence similar examples of obsolete and worn infrastructure, 
but the preponderance of infrastructure related to the preparation and 
launch of the Space Shuttle is at KSC. Many of the KSC facilities are 
legacies from the Apollo Program. Assets such as the data cables to the 
launch pads are old and deteriorated and are only being kept 
operational through the ingenuity of the workforce. This cannot 
continue indefinitely.

Question 6. How would you recommend capturing the knowledge of the 
current workforce for future use?
    Answer. There are numerous emerging techniques for ``mining'' 
experience that have been developed as part of knowledge engineering 
efforts. Basically, however, two fundamental conditions must be 
satisfied before any sophisticated efforts can be effective. First, 
there must be an adequate supply of suitable replacement candidates 
within the operations of NASA and its contractors. If these individuals 
overlap the tenure of the current workforce, those with the best 
experience and knowledge can mentor them. This is an ideal way to 
perpetuate quality.
    Second, once there is an adequate pipeline of prospective 
replacements, each entity within NASA must have a long range training 
and relief plan. Such a plan identifies each person who has a planned 
termination (retirement, resignation or transfer) as soon as it is 
known and designates a trainee, new hire or promotion candidate whose 
task it will be to capture the knowledge of the departing person. Since 
every worker is included, each can see his or her ``career path'' and 
identify the knowledge domain that will eventually be their 
responsibility.

Question 7. Your testimony states that the requirements for flying the 
Space Shuttle at an acceptable level of risk is achieved only through 
the innovation and tireless efforts of an experienced workforce. NASA 
Administrator Goldin has testified that a large portion of NASA's 
workforce is aging and about to retire. What effects will large-scale 
retirements of experienced NASA and contractor personnel have on 
Shuttle safety?
    Answer. This question touches at the crux of the concerns of the 
Aerospace Safety Advisory Panel. As the Space Shuttle ages, it will 
require innovative technical and management initiatives to continue 
flying safely. Large-scale retirements of experienced NASA and 
contractor personnel will deprive the Program of the highly experienced 
people needed to formulate and execute these initiatives. It will 
therefore become increasingly difficult to know when the illusive line 
between safe and unsafe operations is being approached, and safety risk 
will almost assuredly increase.
    The Panel believes that two major actions are needed now to 
compensate for the likely departure of much of the government and 
contractor talent responsible for safe Space Shuttle operations. First, 
as discussed above, both NASA and its contractors should begin a 
vigorous hiring program as soon as possible so people will be available 
to work at the sides of the prospective retirees before they leave. 
Second, the experienced workforce should be given the means to execute 
a meaningful life extension program for the Space Shuttle. If modeled 
after successful commercial and military aircraft life extension 
programs, this effort will reduce safety risk and simplify the tasks 
facing future generations of Space Shuttle managers. This will reduce 
rather than increase the reliance of the Space Shuttle on workforce 
experience to maintain safety.

Question 8. You also said that NASA must fund EAPU and other upgrade 
development and certification ``at the expense of activities needed to 
continue flying safely at present.'' What creates this tradeoff? Should 
NASA's Human Space Flight account be restructured to prevent tradeoffs 
like these in the future?
    Answer. Insufficient funding to meet present flight objectives and 
make appropriate investments for the future creates the referenced 
tradeoffs. When managers are faced with this dilemma, they have only 
two viable choices--defer upgrades and expenditures for the future or 
reduce current operations. The Space Shuttle program cannot reasonably 
reduce the present flight rate and still adequately support the 
construction and utilization of the ISS. Therefore, planning horizons 
have been severely limited to provide for current needs. Although this 
maintains current Space Shuttle safety, it has created serious concerns 
on the part of the Panel about the ability of the Program to maintain 
or improve risk levels in the future.

Question 9. Your testimony also highlights that the infrastructure 
situation becomes worse each year due to a growing backlog. What can 
NASA and Congress do to reverse the trend in this problem and ensure 
greater emphasis on the infrastructure maintenance?
    Answer. This is purely a budget issue. Present funding is 
insufficient to support current operations, flight system improvements 
and infrastructure backlog reduction. NASA and contractor managers are 
well aware of the infrastructure weak spots. With adequate resources 
and a reasonable degree of flexibility, they can reverse the trend and 
begin improving the situation rather than letting it deteriorate 
further. Giving management prerogative to NASA and its contractors is 
essential because the relative priority of various infrastructure 
revitalization efforts can shift over time due to circumstances beyond 
the control of the Program.

Question 10. You have also stated today that logistics is a serious 
problem that is affecting the Space Shuttle Program. For example, the 
long lead times for the manufacture of critical components creates 
logistical problems and cannibalization. Can NASA use other contracting 
and purchase strategies, such as are used by commercial companies, to 
reduce these logistical bottlenecks?
    Answer. In general, the long lead times NASA faces are due to the 
unique nature of the components in question. They are a technical 
rather than a management issue. Some critical components take a year or 
more to manufacture. Given the small production runs involved, it is 
likely not cost effective to invest significant sums to develop and 
qualify new, more rapid manufacturing techniques. NASA and its 
contractors must therefore accept the lengthy production schedules and 
plan sufficiently far in advance to ensure an adequate supply of 
components.

                                 ______
                                 
      Response to Written Questions Submitted by Hon. John McCain 
                          to Bryan D. O'Connor

Question 1. You have mentioned that the Shuttle will always need 
substantial hands-on-care and preparations between flights. If the 
Space Launch Initiative (SLI) produces a new vehicle, do you feel that 
the same level of ``hands-on-care'' will be needed?
    Answer. In my opinion. SLI will not get anywhere near production if 
its early development work suggests even half the hands-on of the 
Shuttle. Those hands are what make up the high cost of Shuttle 
operations, and SLI has as a goal an order of magnitude decrease in 
operational cost. Roughly, there can only be one RLV worker for every 
ten Shuttle workers (for a given mass of cargo to orbit) to meet that 
goal.

Question 2. You have stated that although the Shuttle has made 
significant safety improvements since the Challenger accident, it falls 
short of the overall safety levels NASA demands of future human space 
flight. Can you elaborate why you feel that no amount of upgrades to 
the Shuttle will get to the levels of reliability and operational costs 
envisioned for the SLI?
    Answer. Since the Challenger accident, incremental improvements to 
Shuttle safety have come at great cost, largely due to the complexity 
and inflexibility of the basic design. It might be instructive to ask 
NASA for a summary account of cost of risk reduction over the past 15 
years. It takes a lot of money to significantly reduce risk for this 
vehicle. I think you will also find that most of the easy changes have 
been made, and that any further marginal risk improvements will be 
difficult to accomplish and expensive. The money required to further 
reduce the crew safety number for Shuttle to the 1/10,000 mission goal 
that the SLI team is working is probably not reasonable. One of the 
biggest problems here is the difficulty in retrofitting a viable crew 
escape system into the Shuttle. That means that to meet the crew safety 
goal, the Shuttle system itself must meet the goal. The SLI program is 
starting from scratch, so, in principal, they have the flexibility to 
design a vehicle with less than 1/10,000 loss rate and an escape system 
that makes up the difference. For example, the Russian Buran was 
designed with an expected failure rate of 1/50. The design included a 
world class crew escape system with an expected success rate of 75% 
(throughout the high-risk portions of launch and entry). That 
combination gave them a crew loss prediction of 1/200 for the first 
manned flight, which was never flown due to cancellation of the program 
after one unmanned test flight. What that says is that an escape system 
with even marginal capability will substantially improve the crew 
safety story for a high-risk flight vehicle. If the same thinking were 
applied to Shuttle, it's current expected failure rate of 1/500 would 
jump to 1/2000 with a similar escape capability. On the other hand, 
today's Shuttle would require an impossibly good escape system with a 
success rate of 95% to meet the expressed SLI goal. Unfortunately, 
several studies have shown that even a modest escape system for Shuttle 
is not feasible unless the agency is willing to pay several billions, 
give up performance and potentially crew size, and take several years 
down time to do the upgrade to each flight vehicle.

Question 3. In its 1999 report, the NRC recommended that NASA should 
``provide better incentives for the USA Corporation . . . to propose, 
fund, and implement upgrades to achieve the Shuttle program's goals.'' 
As you consider the recent cost shortfalls in the Shuttle program and 
delays in implementing Shuttle upgrades, do you believe that NASA is 
fully meeting this recommendation?
    Answer. NASA's response to the NRC report was that they were in the 
process of changing the contract with USA to include a value 
engineering clause that would provide the needed incentive. My 
understanding is that this clause has since been formalized, but I have 
no direct knowledge of how effective this incentive has been in 
encouraging USA to come forward with upgrade ideas or financial support 
for upgrades.

Question 4. The 1999 NRC report also recommended that NASA use more 
accurate cost estimates that include all costs associated with the 
upgrade, including hidden costs. In your opinion, has NASA followed 
this recommendation in evaluating Shuttle upgrade options?
    Answer. NASA's response to the NRC report said that they were 
implementing the recommendation. Neither the NRC nor I have 
independently confirmed either the implementation or its effects.

                                 ______
                                 
      Response to Written Questions Submitted by Hon. Bill Nelson 
                       to Michael James McCulley

Question 1. You have stated in your written statement that the Electric 
Auxiliary Power Unit (EAPU) project had completed the requirements 
definitions, resolved many technical issues, and was ready to produce 
detailed and cost-efficient designs. However, NASA's Space Flight 
Advisory Committee stated in a letter report, ``. . . this upgrade 
appears to be much more challenging than originally anticipated. There 
are major weight, cost and technical issues. The Committee suggests 
that this project be removed as an active Shuttle upgrade project and 
that it become a technology project.'' NASA has terminated plans for 
full development of the EAPU until the technology is more mature.
    Can you explain the apparent difference in opinions on this 
project?
    Answer. While USA agrees with the statement that ``this upgrade 
appears to be much more challenging than originally anticipated,'' it 
strongly disagrees with the characterization that there are cost 
issues, technical issues and that the project should not proceed toward 
full implementation.
    This fundamental difference in opinion stems from the immaturity of 
the data that the NASA Space Flight Advisory Council (SFAC) reviewed 
and the inappropriate baseline that was used for comparison. Since the 
SFAC's review, progress has only confirmed our previously held position 
that the EAPU project has no technology issues and can be ready for 
implementation in FY03 if appropriate funding is made available in 
FY02.
    NASA's Space Flight Advisory Council met May 1-2, 2001. At that 
time, the EAPU project was in the process of developing cost proposals, 
placing prototype units on test stands and validating designs and 
requirements as additional data became available. The review of the 
project was premature at that time since the project did not come 
forward for an Authorization to Proceed decision until October 2001. 
Key items not available for the SFAC's review include:

   Prototype testing results: The EAPU project was just 
        starting its end-to-end testing of its high-fidelity prototype 
        systems. This end-to-end system testing evaluated both 
        hydraulic power performance and battery performance.

   Battery cell testing and design data: The battery cell 
        Preliminary Design Review was held later in the month of May. 
        That review contained key information about cell life, 
        capacity, safety and the development process needed to produce 
        a flight-qualified cell. The cell safety and performance 
        testing (on over 100 cells) was on going at that time, and data 
        was not available for the SFAC's review.

   Cost data: None of the cost proposals had been negotiated, 
        nor had fact-finding been complete prior to the SFAC's review. 
        Furthermore, the cost information that was reviewed contained 
        almost $250M in Rough-Order-of-Magnitude cost data. The project 
        office was in the process of issuing a Request for Proposal for 
        the battery system and reviewing the content assumptions of the 
        proposals when the project office was told that it would not be 
        implemented in the near future.

    As mentioned earlier, the EAPU project was in the formulation 
phase, not the implementation phase, when the SFAC reviewed its 
progress. During this phase, as specified in NASA plans, the project 
should be establishing requirements and programmatic cost and schedule 
baselines. Also, data and requirements from early studies should be 
updated to reflect any new design data that is available. The EAPU 
project followed this process. The original cost data that was 
developed for the project ($220M) was an early, low fidelity figure 
based on very conceptual design data, immature requirements and did not 
include large cost elements such as the required single-string EAPU 
flight demonstration (the so-called ``1-of-3 flight'' requirement). Any 
comparison between this cost estimate and the rough proposal data is 
strictly an apples-to-oranges comparison. Likewise, the weight estimate 
was based on a different design, was not based any detailed estimates, 
and, did not have standard growth margins. This initial weight estimate 
helped establish the early EAPU requirement of 2000 pounds greater than 
the current APU system. This weight target is not a hard Shuttle 
requirement. It was not derived from capabilities or mission needs, but 
rather reflects a desire not to change a Space Station Interface 
Control Document. While the EAPU project cannot currently meet this 
requirement, its current weight estimate is within actual Shuttle 
capabilities based on mission requirements. Finally, it should be 
mentioned that the project's technical progress, as referenced above, 
was compared to systems that are in the implementation phase, not ones 
that were in the process of demonstrating technical feasibility and 
design approaches.
    Excellent progress has been made since May 2001. During this time, 
the EAPU project completed its prototype testing, performed a cost 
reduction analysis, conducted five design reviews and revisited and 
validated its top-level requirements.
    The prototype testing and design reviews demonstrated a number of 
very important system capabilities:

   The motor/pump system provides sufficient hydraulic power 
        and power quality under standard Shuttle mission profiles and 
        more stressing evaluation profiles. Comparisons with the 
        current APU system show that the EAPU meets or exceeds its 
        performance in transient response and hydraulic power quality.

   The battery meets performance characteristics of 50 mission 
        cycles and overall mission energy.

   The battery cell test data indicates that the Lithium-ion 
        cells are very durable, produce higher energy densities than 
        their rated values and can be produced under standards that are 
        acceptable for the Shuttle program.

   The safety and reliability benefits of the EAPU project have 
        been established by extensive study and detailed probabilistic 
        risk assessments. (The EAPU is ten times safer than the 
        existing APU and eliminates the largest risk to Orbiter 
        safety).

    With hydraulic transparency to the existing hydrazine APU 
demonstrated and battery performance characteristics clearly met 
through test, USA does not see any technology-related issues with the 
development of the EAPU system.
    The continuing cost reduction analysis, which focuses on finding 
alternatives to key cost drivers, has been exceptionally successful in 
reducing both cost and weight. By validating key requirements, the 
project found conservatism in many of them. Energy requirements were 
too high, ground operations constraints were too stringent and battery 
lifetimes did not reflect the new operational aspects of the design. 
These requirement reductions had a large effect on the overall design. 
The cell size was reduced. Likewise, consolidating functions reduced 
parts counts. The battery location and packaging was changed. Finally, 
the number of facility and test site modifications was also minimized. 
The result to date is an EAPU project that has a weight estimate of 
less than 6000 pounds (1000 pounds less than when SFAC reviewed the 
project) and a cost that is competitive with industry averages for the 
development of systems of this size and complexity.
    The EAPU represents increased safety for our astronauts and for the 
Shuttle Team that gets them into space. No other safety upgrade 
improves the safety of the Shuttle as much as the Electric APU. The 
project has demonstrated its technology through test. It has validated 
its requirements and reduced its overall weight estimate. Furthermore, 
the EAPU project team performed all of these efforts within its 
authorized funding limits and within its schedule constraints.
    The EAPU project has matured beyond technology development and 
should be funded to a level needed to support an implementation 
decision in FY03.

Question 2. What have been the changes to Shuttle operations since the 
termination of the X-33 program and the reality that the Shuttle is 
NASA's only option going forward for human space flight?
    Answer. In terms of current, day-to-day operations of the Shuttle 
Program, there were no impacts or changes to the operations part of 
what we do. The strong safety focus with which we approach all our work 
and processes is the same, and we use the same Certification of Flight 
Readiness process to ensure that every element that supports a typical 
Shuttle mission is ready to proceed with every phase of flight 
(hardware, software, and people are ready). Of course, events like the 
termination of X-33, X-34, or other development/technology programs 
remind one that it becomes even more important to include a robust 
Shuttle Upgrades program as part of the overall plan for future 
operations. If we need to operate the Shuttle longer, then we also need 
to be alert for more cases of obsolescence, increased wear and tear on 
the hardware, and we need to continue to look for improvements in 
safety and supportability.

Question 3. You have mentioned that if technological challenges on one 
upgrade program make it impossible to move aggressively forward on one 
project, NASA should revise its timetable for implementation or 
redirect to the next project, rather than reprogramming the funds for 
other purposes.
    As the operator of the Shuttle program, have you had funds that 
have been taken from your contract and place in other areas of NASA?
    Answer. Funds will be taken from the USA contract if the NASA 
proposed plan is implemented.

Question 4. You have talked about the flight schedule for the Shuttle 
program. The annual budget includes some fixed and variable costs, with 
those variable costs dependent upon the number of Shuttle flights. Can 
you comment on the marginal cost of a Shuttle launch?
    Answer. There are two different concepts that are evaluated 
periodically relative to cost impacts for changes in the Space Shuttle 
flight rate. The first is the marginal cost associated with adding or 
deleting one flight, in one year only, from a current baseline (with 
adequate lead time notice) and then resuming the baseline flight rate. 
The second is changing the baseline flight rate to a sustained level at 
some specified rate.
    Current ROM estimates for SFOC impacts for each of these cases are 
as follows:

          1. Add one flight in one year only from a baseline of 6 
        flights per year--$23M in FY03 dollars; $23M impact may not 
        all occur in the same year as the year the flight is added. 
        Impacts include significant overtime, expendable hardware, 
        repairs, consumables and travel as added incremental cost.

          2. Delete one flight in one year only from a baseline of 6 
        flights per year--$10M in FY03 dollars; $10M impact may not 
        all occur in the same year as the year the flight is deleted. 
        Impacts include limited overtime, expendable hardware, repairs, 
        consumables and travel as reduced incremental cost. The 
        principal difference to the cost of adding one flight is 
        overtime.

          3. Initial studies on a sustained flight rate of 5 per year 
        versus 6 per year indicate an average annual reduction in cost 
        of $17M in FY03 dollars; the $17M impact may not all occur in 
        the same year as the year the flight rate is changed from 6 to 
        5. Impacts include overtime, expendable hardware repairs, 
        consumables and travel as reduced annual cost. These impacts 
        are in the process of being revalidated.

          4. An impact assessment of a sustained flight rate of 4 per 
        year versus 6 per year is in process and will soon be provided 
        to NASA.

Question 5. Based upon your experience as the operator of the Shuttle 
Program, what level of funding would we need to get the program at the 
level it should be? Also, what areas would you recommend for these 
changes?
    Answer. Earlier this year, USA participated in the FY01 Program 
Operating Plan (POP) cycle, during which all elements partnered with 
their NASA counterparts a budget level that they thought was 
appropriate for continuing the program in a healthy, safe manner. That 
POP was first developed for a flight rate of seven missions per year 
and then adjusted for a flight rate of six missions per year. The 
recommended level from that effort represents the appropriate level of 
funding (developed by NASA and Contractor partnering) for operations 
for the Shuttle Program. Also, the recommended budget level for Shuttle 
Upgrades should be available with plus-ups for infrastructure 
supportability and Orbiter Maintenance and Modification (OMM) in 
addition to the operations budget.

Question 6. NASA is reported to be considering delaying Orbiter Major 
Modifications and delaying and canceling upgrades to the Space Shuttle. 
What affect will these delays have on the long-term use of the Space 
Shuttle?
    The deferral of the efforts performed during the Orbiter Major 
Modifications (OMM) creates four main issues for the long-term use of 
the Space Shuttle System.
    Answer. The first issue encountered by these deferrals is the 
potential Orbiter safety and hardware issues that would go undetected 
without the OMM. It must first be understood that the internal Orbiter 
access that is provided to the Shuttle team during the performance of 
major modifications provides the team with a unique insight into the 
vehicle's integrity that cannot be obtained during the regular 
operational servicing of the vehicle. Simply put, many problems 
discovered during the OMM would not be discovered during routine 
maintenance or Orbiter Structural inspection. This is clearly 
illustrated by the wire inspections that were performed during the OV-
102 (Columbia) OMM that yielded significantly more discrepancies than 
similar inspections in Orbiter processing flows. In addition, the 
presence of corrosion under the Orbiter 582 bulkhead and in the aft 
avionics bays was not discovered until the OV-102 OMM.
    The second issue with OMM deferrals is the risk to the program 
schedule that is created by extended Orbiter down time due to hardware 
issues that are detected late in the processing flow or could be 
avoided by upgrading the component/system during the OMM. The major 
modifications to upgrade Orbiter system components cannot be 
incorporated into the normal processing flow of the Orbiter or even 
into a mini-modification period. These major modifications are more 
complex than the replacement of an existing component and are also 
extremely intrusive to the Orbiter's systems and subsystems. These 
major modifications require extensive end-to-end integrity checks to 
insure safe operation of the Orbiter when it is returned to the Space 
Shuttle fleet. In addition, major system/subsystem issues that are 
discovered during the OMM do not impact flight-processing activities 
for other vehicles and can be fixed while the system is disassembled.
    A third issue that would be encountered by OMM deferrals is the 
additional cost and schedule growth that will be encountered when the 
OMM is performed downstream. As OMMs are deferred, the systems and 
subsystems that are currently part of the Orbiter obsolescence cause 
the Space Shuttle program to operate on a more costly ``fix as you 
fly'' basis as compared to upgrading the items. In addition, the 
continued use of the currently installed systems/subsystems will lead 
to increasing the likelihood of late mission scrubs on the pad and/or 
early mission terminations due to on-orbit failures. Also, deferral of 
the OMM delays or eliminates potential safety improvements that can be 
made with technological advances. Stretching out existing upgrades 
programs will lead to increased overall costs, as more is spent on 
studying how to fix on-going problems as compared to implementing 
solutions.
    Finally, an OMM deferral will cause the loss of key personnel with 
critical Shuttle Orbiter knowledge. This loss of experienced personnel 
due to re-assignment, transfer, etc. will eventually drive up the total 
costs of implementing the needed Orbiter upgrades. The Space Shuttle 
program needs to ensure that the elimination/deferral of the OMM in the 
near term to meet today's funding issue doesn't create an untenable 
downstream cost, schedule and risk threat to the program due to the 
loss of the critical Orbiter vehicle knowledge and experience.

Question 7. Are there any upgrades that you believe must be implemented 
in order to ensure the safe operation of the Space Shuttle and that 
NASA has indicated an intention to cancel?
    Answer. The Shuttle continues to operate safely within its current 
risk of loss parameters. We believe that delay of the safety upgrades 
will unnecessarily delay improving safety to levels that can be 
achieved with today's technology. USA recommends that any move to delay 
the implementation of Multifunction Electronic Display Subsystem 
(MEDS), to cancel the Advanced Health Monitoring System (AHMS Phase 2), 
the Solid Rocket Booster Thrust Vector Control (TVC), and Electric 
Auxiliary Power Unit (EAPU) projects and extend the schedule of the 
Cockpit Avionics Upgrade should not be approved.

Question 8. Your testimony also covers important NASA infrastructure 
problems and their effects on the Shuttle Program. In your opinion, is 
NASA putting the right amount of emphasis on infrastructure 
maintenance, such as repair of the Vehicle Assembly Building in 
Florida?
    Answer. The short answer is that NASA has not been putting enough 
resources into maintaining infrastructure as evidenced by the size of 
the backlogged maintenance and repair of facilities.
    NASA infrastructure maintenance occurs on two primary paths. First 
is day-to-day asset maintenance and repair. This type of maintenance is 
comprised of preventive maintenance procedures, which keep a reliable 
asset in proper operating condition, and corrective maintenance actions 
to repair unexpected system failures. Secondly is larger capital 
projects to replace systems, which have become unreliable or obsolete 
due to age degradation and/or lack of available vendors to provide for 
continued system use. Day-to-day maintenance is funded through the 
normal program-operating budget. Capital projects are funded primarily 
through the Construction of Facilities (CoF) cycle using either program 
or institutional fund sources.
    Within NASA the recognized standard for necessary annual investment 
in infrastructure maintenance and repair is 2-4% of the current 
replacement value of all assets in operation. This standard was 
recommended in the American Public Works Association Special Report #60 
``Committing to the Cost of Ownership, Maintenance and Repair of Public 
Buildings,'' first published in 1990. Data gathered by NASA since 1996 
shows that the agency has consistently invested below 2% of the current 
replacement value. Likewise, the Space Flight Centers at which the 
Shuttle Program operates have spent below 2% of the current replacement 
value.
    The trend in CoF funding has also seen a sharp decline from annual 
investments of around $500M in the early 1990s to a low of less than 
$140M in 1998. NASA has begun to increase the investment level, but it 
is still just over one half of the earlier required investment. This 
funding supports NASA's new construction as well as projects of a 
``maintenance'' nature.
    With these investment strategies the Backlog of Maintenance and 
Repair in the agency has grown to near $900M ($550M in Code M) and 
without a substantial investment to buy down this backlog a vicious 
cycle will worsen. This cycle is one in which more of the day-to-day 
maintenance and repair funding is expended performing band-aid type 
corrective maintenance on old, unreliable systems which are backlogged 
for permanent solutions due to lack of CoF level funding. As more day-
to-day maintenance funding is expended on corrective maintenance, less 
can be used for preventive maintenance that results in accelerated 
degradation of operable systems.
                                 ______
                                 
        Shuttle Officials Prepare for Impending Budget Shortfall
                      Space News, August 13, 2001
                     By Brian Berger, Staff Writer

    WASHINGTON--When NASA's Space Shuttle Discovery returns later in 
August from its planned 11-day mission to deliver a fresh three-person 
crew to the international space station, the 18-year-old orbiter will 
not be sent out to the California desert for a new cockpit as 
previously planned.
    That is because Discovery's year-long stay in Palmdale, Calif., for 
upgrades and thorough maintenance could be delayed until 2005 as part 
of a slew of cost-cutting measures NASA Space Shuttle officials are 
contemplating in light of a looming budget shortfall.
    Higher than expected labor costs, rising energy bills and other 
expenses are expected to put a pinch on NASA's anticipated $3.2 
billion-a-year Space Shuttle budget starting in 2002, forcing Shuttle 
officials to come up with hundreds of millions of dollars in savings in 
the coming years.
    Facing a $218 million shortfall in 2002 alone, NASA Space Shuttle 
officials are preparing to scrap or scale-back a half-dozen safety 
upgrades and postpone sending Discovery and sister ship Endeavour to 
Palmdale for the installation of modern cockpit displays and other 
improvements.
    Space Shuttles Atlantis and Columbia already have been to Palmdale 
to have their old-fashioned flight gauges and analog dials replaced 
with modern flat-panel displays designed to ease pilot workload. Until 
recently, NASA's plans called for modernizing all four Shuttles' 
cockpits by the end of 2002, but now it appears that date could slip to 
2006 as Shuttle officials scramble to come up with near-term savings.
    Also on the chopping block are several Shuttle upgrades NASA 
officials identified as recently as last year as high priorities with 
the potential to cut in half the odds of losing a Shuttle during 
launch.
    NASA canceled one of those planned upgrades, an Electric Auxiliary 
Power Unit, in June, citing concerns that the battery-powered system 
would not be ready on time and within budget. Shuttle officials now are 
pondering canceling or scaling back two other high-priority upgrades, 
an advanced health monitoring system for the Shuttle's main engines and 
miscellaneous avionics and cockpit upgrades.
    Other upgrade efforts that could be affected by NASA's budget woes 
include a thrust vector control system for the Shuttle's solid-rocket 
boosters, designing a stronger tire for the Shuttle's main landing 
gear, modifying the geometry of Shuttle solid-rocket propellant for a 
more uniform burn, and a study of further improvements for the craft's 
main engines.
    NASA spokeswoman Kirsten Larson said such steps are being 
considered as the agency attempts to reconcile an essentially flat 
Shuttle budget with inflation and rising operations costs. Larson said 
NASA also is considering mothballing Columbia, the oldest and heaviest 
of the agency's four orbiters, in 2003 or 2004.
    Larson said no final decisions have been made on any of the 
proposed cuts. Any decisions, she said, will depend on how the Shuttle 
program fares in NASA's 2003 budget, currently being developed in 
cooperation with the White House Office of Management and Budget and 
due to be released early next year.
    NASA does not plan to abandon Shuttle upgrades altogether, 
according to Shuttle program officials. For example, the agency's 2002 
budget includes funding for an initial phase of cockpit and main-engine 
health monitoring system upgrades, program officials said. NASA also 
intends to fund an effort to strengthen the Shuttle's external fuel 
tanks with a different welding technique.
    Shuttle program officials said canceling or scaling back a half-
dozen upgrades and postponing sending Discovery and Endeavour to 
Palmdale would enable the program to live within its proposed $3.2 
billion budget for 2002, but would not fully eliminate funding 
shortfalls in subsequent years.
    William Readdy, NASA's deputy associate administrator for human 
space flight, was unavailable to comment by press time due to his 
engagement in Discovery's launch preparations, Larson said.
    Readdy assumed responsibility for the Shuttle program in an acting 
capacity Aug. 10 upon the retirement of Norman Starkey, the agency's 
deputy associate administrator for the Space Shuttle.
    James Eyman, vice president and general manager for Space Shuttle 
upgrades at United Space Alliance, the Houston-based company that 
operates the Shuttle fleet under contract to NASA, said his company is 
prepared to continue operating the Shuttle at current risk rates if 
NASA scales back some of the planned upgrades. However, he said he 
remains hopeful that NASA will find a way to proceed with the upgrade 
strategy approved in 1999, two years after the agency lifted a three-
year design freeze on Shuttle improvements.
    ``We are watching the political process just as others surely 
are,'' Eyman said. ``We're hopeful NASA will get fully funded and will 
be able to continue most if not all of these upgrades.''
    Congress already has signaled a willingness to help NASA cover at 
least part of its $218 million shortfall in 2002.
    The NASA budget bill approved by the U.S. House of Representatives 
in early August added $35 million to the Space Shuttle program's 2002 
budget to pay for refurbishment of the Vehicle Assembly Building at 
NASA's Kennedy Space Center, Fla. Meanwhile, a companion bill in the 
Senate includes an extra $50 million for Shuttle safety upgrades.
    But it remains unclear just how sympathetic lawmakers and other 
government officials will be to NASA's human space flight budget woes.
    ``Code M's problems are of their own making,'' one U.S. government 
official said, referring to the NASA division responsible for human 
space flight activities. Code M also is wrestling with a projected $4.8 
billion cost overrun on the international space station.
    A Washington space policy analyst said rising costs are putting a 
squeeze on NASA's Shuttle budget at a time when there is no place to 
look for savings other than the upgrades program. With the 
international space station's projected overrun putting intense 
pressure on NASA's human space flight budgets, the Shuttle program is 
``between the proverbial rock and a hard place,'' the analyst said.
    Additionally, the analyst said, some Shuttle upgrades are turning 
out to be more expensive than NASA and its contractors had estimated. 
``This just raised further questions about the reliability of NASA's 
cost estimating procedures,'' the analyst said.
                                 ______
                                 
                                     The Planetary Society,
                                        Pasadena, CA, May 15, 2001.

Hon. John McCain,
Washington, DC

Hon. Ernest F. Hollings,
Washington, DC

Dear Senator:

    We know that Congress believes that it is important to hear from 
representatives of the public concerning matters of public interest. In 
that spirit we present this letter to you, and ask that it be included 
at the next opportunity with testimony before your Committee, in 
keeping with our efforts to provide information to Congress about 
public support for space exploration.
    It has been six years since The Planetary Society testified before 
this Committee. During those years, the Society's membership included 
more than 250,000 people who are interested in, and inspired by, the 
exploration of other worlds and the search for life elsewhere. We are, 
by far, the largest organized constituency in the space community.
    The principle message of our constituency is that space exploration 
is popular--and your support for NASA programs should build on that 
popularity and public interest. There are four specific issues that we 
ask you to address in this year's budget deliberations.
    First, we urge the restoration of program elements in NASA's human 
spaceflight enterprise to study concepts for future flight beyond low 
Earth orbit and to begin addressing the required technologies. The 
Space Station should not be the next step to nowhere as it is now. The 
purpose of the Space Station is to prepare humans for destinations 
beyond earth orbit.
    Second, human spaceflight should lead eventually to Mars. We do not 
advocate a start now on any such human mission, but we urge you to 
insure that the robotic planetary program is designed to lead to that 
end. The Planetary Society believes this requires the establishment of 
robotic outposts on Mars that will support science goals in early 
phases and human habitation later when it is feasible.
    We ask you to restore and support the Pluto-Kuiper Express mission 
that was removed from the Space Science budget. Otherwise, this nation 
will miss a unique opportunity to visit the last unexplored planet that 
will not reoccur for some time to come.
    Fourth, we believe in the importance of international cooperation, 
public support, and interest in the space program and ask that you 
support international cooperation in the NASA program. Space 
exploration has become an inherently international enterprise, and this 
type of cooperation is key to carrying out complex exploratory and 
scientific programs in space.

Public Interest
    In many conversations we have had with legislators and decision-
makers over the years, almost all of them are positive about the value 
and popularity of space exploration. It may generate less public 
expression than bread-and-butter, financial, and quality of life 
issues, but as has been wisely said, ``man does not live by bread 
alone.'' The public understands this. The support is proven by the way 
the public follows NASA missions that venture to other worlds; by the 
large numbers of visitors at the National Air and Space Museum, Kennedy 
and Johnson Space Centers; by the spectacular attention paid to 
scientific discoveries by Hubble, Mars Global Surveyor, the Near Earth 
Asteroid Rendezvous mission; and by the adventures of both humans, like 
John Glenn, and robots, like Mars Pathfinder.

Human Spaceflight
    The basis of the popularity of space is exploration. It is the 
raison d'etre for NASA. We are concerned that exploration is threatened 
in the current NASA budget and cite the following examples of this in 
both the human and robotic program.
    The space station is running into cost overruns and NASA has no 
resiliency to deal effectively with the problem without severely 
cutting the program. This lack of budget resiliency is a result of the 
large loss of purchasing power exceeding 30% in the last eight fiscal 
years--a budget reduction uniquely large compared to the rest of the 
Federal Government. So the crew on the space station will be limited, 
the duration of stay will be limited, the TransHab is cancelled, and no 
preparation or study of human space flight out of Earth orbit will be 
undertaken. In short, we have a human spaceflight program leading to 
nowhere. If the space station leads nowhere with astronauts neither 
conducting nor preparing for exploration, then it will turn off the 
public as happened a decade ago when we had a Shuttle program that also 
was leading nowhere.
    The Planetary Society has consistently supported a space station 
worth the cost--we hope Congress and the Administration will provide 
adequate support to NASA so that the International Space Station 
remains so.

Robotic Spaceflight--Mars Outposts
    Robotic scientific exploration of space has proven its value. 
Congress, the Clinton Administration, and now the Bush Administration 
have played a constructive role in providing increasing support for 
Mars exploration. It is no wonder--Mars is the only extraterrestrial 
world we know that holds clues to past life and the promise of future 
habitation. The public is enthralled with the search for 
extraterrestrial life and the attempts to understand humankind's place 
in the cosmos. Much of this endeavor centers on Mars. We ask you to 
support the increase in funding for Mars in the FY2002 budget request.
    As good as the Mars program is, there is something lacking. It is 
not funding. As with the space station, it is direction. It is a 
subject about which we can only whisper; it is too dangerous to say out 
loud in Washington. It is called humans. The irony is clear to us, but 
seems to escape many policy makers. While Mars has received increased 
funds and commitment for robotic missions, based on its link to 
possible microbial life and the sense of Mars as an ultimate human 
destination, the link to human exploration is not permitted. The public 
makes this link and most assume we are on our way there. But NASA is 
forced to cut even small study programs about the future of human 
exploration. We do not call for a premature and ill-founded political 
initiative for a human Mars mission. But there is no reason not to 
acknowledge this as a goal of the robotic program and begin to develop 
robotic Mars outposts that can one day serve as the infrastructure for 
human exploration when the time is right. Our position on Mars Outposts 
is submitted as an appendix to this letter.

Pluto
    Mars is not the only planet in the Solar System, nor the only place 
for humankind to gain an understanding of our place in the cosmos. This 
country has explored the solar system from Mercury to Neptune, and has 
visited scores of solar system moons, asteroids and comets. But not 
Pluto. Pluto is the only unvisited planet in the solar system and also 
the most conspicuous member of a new class of objects about which we 
are just learning--the Kuiper Belt objects beyond the orbit of Neptune. 
The opportunity for our generation to complete the reconnaissance of 
the solar system and reach Pluto is fleeting. NASA has a plan to reach 
Pluto with a 2004 launch, the last chance for centuries to reach the 
planet with its atmosphere intact and with favorable lighting 
conditions. But for a lack of about 0.5% in the NASA budget, those 
plans are proposed for cancellation. Because this issue has received 
such great public attention, we specifically ask that Congress review 
the proposed cancellation in an open hearing. We will be pleased to 
testify about the important scientific reasons to explore the planet 
and the consequences if we fail to take advantage of the narrow window 
to launch a mission.

International Cooperation
    There are many other issues that could be mentioned concerning the 
space program--too many for this letter. But we must cite one that 
deeply concerns us: losses to the U.S. space program resulting from 
inhibitions to international cooperation. The inability of the United 
States to develop low cost launchers coupled with a policy prohibiting 
Americans to take advantage of the world's oversupply of rockets and 
launch sites, is holding back the country's access to space. 
Additionally, technology and communication policies slow down 
scientific and technical accomplishment in the space program, or make 
it much more expensive. Congress has added restrictive language 
supposedly protecting American space launch industry that has actually 
restricted access to space and inhibiting American space exploration 
and development. Regulations imposed by the Congress are keeping 
American ideas earth-bound instead of in space.
    Public support for international cooperation is strongly evidenced 
by the space station--a program which gained little support as a 
nationalistic endeavor when first proposed, and which has enjoyed 
widespread support when converted to an international program. This is 
an important consideration in planning the future of the space 
exploration.

Conclusions
    We ask that the Committee:

          1. LAdd funds to Space Science specifically to accomplish a 
        Pluto mission.

          2. LInitiate funding for programs to study the future of 
        human space flight beyond low Earth orbit, including the 
        development of Mars Outposts in the Space Science program.

          3. LEasing of regulations restricting international 
        cooperation.
    The Planetary Society presents our position in terms of public 
interest and popularity of space exploration. The Society is the 
largest space interest group on Earth. We ask for your consideration of 
the great interest in space exploration, and thank you for your 
attention.
        Sincerely,

Bruce Murray             Wesley T. Huntress, Jr.  Louis Friedman
President                Vice President           Executive Director



                         Next Outposts in Space
                  Recommendations For Mars Exploration
  Bruce Murray, Wesley T. Huntress Jr., Louis Friedman, Risto Pellinen
                         The Planetary Society

    A key issue now facing all spacefaring nations is the alignment of 
the International Space Station (ISS) and future goals in space. The 
main scientific rationale for investing billions of dollars in the ISS 
is to learn how to keep humans healthy in space over long durations. 
Scientists will conduct research onboard the orbiting laboratory to 
understand the debilitating effects of weightlessness and develop 
countermeasures. With this knowledge, humans will be able to venture 
beyond the Moon to Mars and other distant bodies. Thus, the station is 
an essential stepping stone for human exploration of our solar system.
    But will humans venture beyond the Moon? When? Under current 
policy, this decision is deferred until after the ISS is assembled in 
2005. To wait four years to plan our next steps in space is both 
unnecessary and unadvisable. Delaying the decision potentially 
threatens the ISS if something should go wrong during assembly--a 
likely possibility. If the station is perceived to be without purpose, 
difficulties experienced during assembly may imperil the program and 
thus our nation's human exploration goals.
    To prevent such misfortune--and to demonstrate bold vision--The 
Planetary Society urges a new cornerstone of space policy be laid: a 
pathway--not yet an approved project--that leads to human exploration 
of space beyond Earth orbit, and eventually to the surface of Mars.
    Currently, there is no planned transition from robotic missions 
(which are currently exploring the red planet) to future human 
expeditions. The Planetary Society proposes to form a bridge between 
these programs and make possible the incremental, affordable, and 
inevitable human exploration of Mars. Announcing such a policy would 
generate tremendous excitement, yet necessarily leaves open details 
such as cost, commitment, and the date for an eventual human mission to 
Mars.
    To provide the draw towards the ultimate destination for humans in 
the 2lst Century, The Planetary Society proposes a program called Mars 
Outposts. It involves the selection of candidate outposts on Mars--
high-intensity research sites--that in the future would serve as 
potential landing areas for human expeditions. At these sites, 
continuous communications and navigational systems would be established 
to support robotic missions, such as advanced rovers to search for 
evidence of life and return samples to Earth for study. In the years 
ahead, the same equipment would be used to facilitate in-situ 
production and storage of propellant and breathable oxygen and other 
key technologies for human missions.
    The Mars Outposts program would create the necessary, and needed, 
transition from robotic exploration to human exploration. Importantly, 
it connects through policy and programs, the International Space 
Station, robotic missions to Mars, and the eventual launch of human 
expeditions.
    The outposts can be viewed as ``robotic Antarcticas'' on Mars, 
areas of intensive scientific study of Mars from Earth. At these sites, 
robotic probes would comprehensively explore the surrounding terrain. 
Using virtual reality, humans worldwide would be able to participate in 
the exploration of our sister planet. Imagine looking through the 
``eyes'' of a robotic probe as it first ventures through a canyon or 
over the lip of a hill, or digging below the surface and discovering 
evidence of water and possible life.
    Just like the scientific station in Antarctica and the ISS the Mars 
Outposts would be built through international cooperation. In 
actuality, the outposts would be an extension of the ISS. And 
importantly, financial resources would be shared and allocated 
incrementally.
    The Planetary Society urges the adoption of an international Mars 
Outposts program. Over the next four years, plans would be crafted and 
preliminary candidate sites selected. Space planetary programs would 
begin to be integrated with Human Space Flight programs to cross-
fertilize engineering and operations. Mars Outposts that would 
eventually make possible human expeditions.
    Exploration is the raison d'etre of a government space program. 
Public interest and support is repeatedly demonstrated by the new 
ventures to Mars, by the search for extraterrestrial life, 
understanding our origins and the sensing of the cosmos.
    We are blessed to live at a time when we are able to not only dream 
about distant worlds, but to actually explore them. Mars is special--
the only place so far discovered with hints of extraterrestrial life, 
the only world we can imagine humans settling on in the foreseeable 
future.
    Mars Outposts will be the bridge to that possible future--a bridge 
affordable in today's space program but carrying us in tomorrow's. We 
look to the new Administration for leadership, on that bridge to the 
future and invite you to join us in ``inspiring the people of Earth to 
explore other worlds and seek other life through research, education, 
and public participation.'' \1\
---------------------------------------------------------------------------
    \1\ The Planetary Society's mission statement.
---------------------------------------------------------------------------
    In addition to addressing the shortfall in resources for space 
science, a primary concern for the next administration will be the 
International Space Station. Its assembly is scheduled for completion 
in 2005. Dozens of flights must be precisely executed to complete the 
mission. Inevitably there will be problems, some potentially severe. It 
is critical for the new administration to guide the project to its 
completion, making sure that its main goal--learning how to keep humans 
healthy in space for long durations to enable human expeditions beyond 
the Moon--remains tied to the future goals of our nation's space 
program.
    The ISS program will become increasing complex as components are 
added to the station's structure, and a full-time crew begins to pursue 
``scientific, exploration, engineering and commercial activities.'' 
Sixteen countries are involved in the construction of the orbiting 
laboratory--the largest, international effort ever undertaken.
    Only by conducting research in space can scientists fully 
understand how space affects human health and how to develop and 
validate countermeasures. As explained in the 1990 Augustine Report, 
``A space station is needed specifically to establish effective 
strategies to prevent or mitigate the debilitating deconditioning 
effects on humans of long stays in low gravity fields, and to establish 
absolutely reliable and efficient life support systems for extended 
human stays in unforgiving, hostile environment.''
    With the knowledge gained from research aboard the ISS, humans will 
be able to venture beyond the Moon to Mars and other distant bodies. 
Thus, the station is a stepping stone to the exploration of our solar 
system by human expeditions.
    But when will human missions begin? The main purpose of the ISS--
exploration--has not be sufficiently integrated into potential human 
missions. To date, NASA has focused attention on building the space 
station and wants to delay determining the next step in our nation's 
space program until 2005, when the ISS is completed. Waiting four years 
wastes valuable time. It is unnecessary and inadvisable to delay until 
after the station is assembled to announce the next important goal in 
human exploration.

Mars Outposts
    Robotic probes and human exploration tend to be viewed as separate 
goals. Conventional wisdom assumes robotic missions will be conducted 
for a period of time, then human expeditions will somehow take over. 
This view is flawed. Robotic probes and other robotic technologies are 
but tools and their contribution will not suddenly stop when humans 
plant a footstep on the surface of Mars.
    At issue is understanding the tasks that can best be accomplished 
by robotic technologies and those tasks best performed by humans. There 
are a myriad of questions to be answered as we explore Mars with an eye 
toward human missions in the future. What operations on Mars can be 
handled autonomously? What tasks are best accomplished by humans using 
robotic tools?
    The better we can understand the opportunities and limitations of 
robotic technologies, the better we will be able to mount a successful 
human expedition to Mars. To prepare for the future, the process of 
connecting robotic and human exploration of Mars can and should begin 
today.
    The Planetary Society urges the new administration, as a 
cornerstone of its space policy, to announce a program, called Mars 
Outposts, to establish research sites on Mars. In the near term, the 
outposts would focus and enhance robotic exploration. Eventually, they 
would serve as potential landing areas for human expeditions. (This 
proposal assumes it is premature to commit to a date, cost, or other 
program specifics for a human Mars mission.)
    At the Mars Outposts, continuous communications and navigational 
systems would be established to support robotic missions, such as 
rovers, balloons, and sample returns. Scientific instruments positioned 
at the sites would monitor radiation, dust and winds, creating an 
historical record so scientists can predict local weather patterns. In 
the years ahead, the robotic systems would be used to facilitate the 
in-situ production and storage of propellent and breathable oxygen, 
paving the way for human missions. We would have a comprehensive 
understanding of the surrounding terrain and know what specific 
scientific tasks should be undertaken by a human expedition.
    Establishing the Mars Outposts creates a bridge between robotic and 
human exploration. Importantly, it connects through policy and 
programs, the International Space Station, the robotic exploration 
Mars, and eventual human expeditions.
    The outposts would allow scientists and engineers to develop the 
``complex human/machine symbiosis of the future.'' Using virtual 
reality, the public would be able to directly experience the thrill of 
exploring a new world. Imagine looking through the ``eyes'' of a 
robotic probe as it ventures for the first time through a canyon or 
over the lip of a hill, or digging below the surface and discovering 
evidence of water and possible life.
    Developing the robotic tools to explore Mars will stretch our 
imaginations and lead advanced technologies to assist the private 
sector.
    Just as the space station is an international endeavor, so too will 
be the human exploration of Mars. The robotic outposts create the 
pathway. They provide the structure for the shared, robotic exploration 
of Mars, leading to human presence. Just as the nations of the world 
collaborate in scientific research on Antarctica, so would we join 
together to build the Mars Outposts.
    To mount a human mission to Mars at this time is a very expensive 
proposition. Creating the Mars Outposts can be accomplished 
incrementally, with limited resources. The initial step would involve 
an announcement of the Mars Outposts program and inviting the 
participation of our international partners. Over the next four to 
eight years, we would select the potential landing sites and determine 
how they can best facilitate scientific exploration. Missions would be 
undertaken to place large, robust rovers and landers at the sites and 
establish continuous communications.
    Over time, the sites would become familiar places, inspiring the 
world and a generation of students, as well as focus research for 
scientists. The next four year should not be wasted thinking about our 
future; we should be making our future. We cannot afford to delay until 
after the ISS is completed to plot our next step in space.
    With the Mars Outposts program, the new administration can 
demonstrate its vision and make history by setting the path that will 
enhance science and lead to the eventual exploration of Mars.

                                APPENDIX

The Planetary Society
    The Planetary Society has spearheaded numerous innovative 
opportunities for the general public to participate in the exploration 
of the solar system and the search for extraterrestrial life.
    Conducting such exploration has traditionally been the province of 
scientists and engineers. Yet the rationale for spending public 
resources for exploration involves a greater societal interest that 
does not rest solely on science.
    Among the more notable opportunities for the public's participation 
in our nation's space program are:

   The Mars Microphone--The first privately funded instrument 
        to be sent to another world (was onboard the Mars Polar 
        Lander);

   Red Rover Goes to Mars--The first commercial/education 
        partnership on a planetary mission;

   Visions of Mars--A CD containing works of science fiction 
        about Mars, designed to be placed on the Red Planet as the 
        first library to serve future human explorers;

   MAPEX--A Microelectronics And Photonics Experiment to 
        measure the level of radiation on Mars in preparation for human 
        explorers, and contains an electron-beam lithograph of the 
        names of all members of The Planetary Society;

   Participated in the naming of the spacecraft Magellan and 
        Sojourner;

   Student-designed nanoexperiments to fly on a Mars lander;

   SETI@home--A software tool that allows millions of people to 
        contribute to research and data processing in the search for 
        extraterrestrial intelligence.

    Such projects/events as above presage the day when planetary 
exploration will be truly a global, mass public enterprise, with people 
in their homes and schools in direct communication--and even control--
of robotic devices on other worlds.
Mars Exploration
    The Planetary Society advocates the exploration of Mars, with 
robotic missions leading to eventual human exploration. The Society has 
sponsored numerous projects connected with Mars exploration, including 
field tests of a Russian built rover, designing the guiderope system 
for a Mars Balloon, and the development of the Mars Microphone, which 
was an instrument on the Mars Polar Lander.
    The Society has also sponsored the Mars Declaration calling for an 
international space goal of human Mars exploration.
Search For Extraterrestrial Intelligence (SETI)
    The Planetary Society is the sponsor of one of the most innovative 
SETI projects on earth, SETI@home which utilizes the combined computing 
power of over 2 million personal computers to sift through data 
gathered in a radiotelescope SETI search. The Society has sponsored 
numerous SETI programs for nearly two decades, including radiotelescope 
searches Project BETA in Massachusetts and META in Argentina; and 
optical SETI searches in both Massachusetts and northern California.
The Planetary Society
    Carl Sagan, Bruce Murray, and Louis Friedman founded the Society in 
1980 to advance the exploration of the solar system and to continue the 
search for extraterrestrial life. With 100,000 members in more than 140 
countries, the Society is the largest and most influential space 
interest group in the world.
    The Society supports research and test programs, student projects, 
hands-on involvement for the public in space exploration, and special 
events.

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