. 24/7 Space News .
CAGW Criticizes Subsidies For ULA Satellite Launches

At the core of the issue is whether the big two milspace firms should be able to directly collude in offering a joint launch package for the US Government.

Washington DC (SPX) Jan 10, 2006
Citizens Against Government Waste (CAGW) have criticized the Air Force's plan to grant a multimillion annual subsidy through sole-source contracts for heavy satellite launches to United Launch Alliance (ULA), a joint venture between Boeing and Lockheed Martin.

The Wall Street Journal reported yesterday that the Department of Defense (DOD) has conditionally approved the plan; final approval rests with the Federal Trade Commission (FTC). The companies are now jointly negotiating for the third round of launches under the $32 billion Evolved Expendable Launch Vehicle (EELV) program, which will cover 23 missions lasting through 2011 and beyond.

"The Air Force policy is tantamount to a government bailout," CAGW President Tom Schatz said. "It is a multimillion subsidy to an entity that is effectively insulated from competition."

The ULA will provide launch services for the Air Force and for some missions of the National Oceanic Atmospheric Administration, the National Aeronautics and Space Administration, and the National Security Agency. Boeing and Lockheed Martin will continue competing for private launches.

The FTC has questioned the companies' claim that consolidation will save $100 million to $150 million per year and in December 2005 told both companies it needed more time to review the proposal.

The EELV program was implemented in 1995 to give the federal government "assured access" to space by keeping two domestic providers viable. The first round of contracts was awarded to the same companies in 1998 with the expectation that a strong commercial launching market would emerge. However, the government has assumed an increasing share of the risk and cost of the launching operations.

If approved, the ULA will benefit from $650 million in government subsidies for infrastructure and about $100 million per launch. Furthermore, there is no legal requirement for the Air Force to consider additional bidders that may emerge before 2011.

A July 2005 report from the Government Accountability Office referred to the DOD's space system acquisition efforts as "dismal," and noted that EELV's unit cost has grown 81 percent.

During the first round of bidding seven years go, Boeing illegally obtained proprietary information from Lockheed Martin. The resulting investigation and suspension cost taxpayers $230 million. The new plan would allow contractors to divide costs between cost-plus "capability" contracts and fixed-price "services" contracts.

"The contracts' structure obscures the true cost to taxpayers and rewards scandalous behavior with lucrative long-term deals. To encourage innovation and keep down costs, the Air Force should revert to price-competitive acquisitions and widen the playing field to new competitors," Schatz concluded.

Citizens Against Government Waste is the nation's largest nonpartisan, nonprofit organization dedicated to eliminating waste, fraud, abuse, and mismanagement in government.

Source: Citizens Against Government Waste

Related Links
Search SpaceDaily
Subscribe To SpaceDaily Express

Memory Foam Mattress Review
Newsletters :: SpaceDaily :: SpaceWar :: TerraDaily :: Energy Daily
XML Feeds :: Space News :: Earth News :: War News :: Solar Energy News

Europe's Arianespace Satellite Launcher Hits Cruising Speed
Paris (AFP) Jan 09, 2006
The chief executive of European satellite launcher Arianespace is bristling with confidence at the start of the new year after a record 2005 and the re-birth of the company's troublesome Ariane-5 ECA craft.

  • Microbes Survive Firey Plunge By Columbia
  • Spicing Up Space Meals
  • SpaceDev Appoints New Chief Executive Officer And Vice Chairman
  • ZeroG Aerospace Launches Affordable Space Tourism for the Masses

  • Opportunity Snaps A Fine Example Of A 'Festoon' Pattern In Meridiani Outcrop
  • Opportunity Puts The Arm On Ted
  • Spirit Heading To 'Home Plate'
  • Mars Exploration Rovers Advance Understanding Of The Red Planet

  • CAGW Criticizes Subsidies For ULA Satellite Launches
  • Europe's Arianespace Satellite Launcher Hits Cruising Speed
  • ILS to Launch ASTRA 1KR in 2006
  • Telematic Solutions Awarded EUR8Mn Contract For Vega Pad Work In Kourou,

  • Indian Small EO Satellites To Study Atmosphere
  • Space Imaging Awarded Additional $24 Mln From Pentagon's NGA
  • NG Ships First Advanced Tech Microwave Sounder Flight Instrument To NASA
  • The Topex/Poseidon Oceanography Mission Ends

  • New Horizons Remains On Course For January 17 Launch To Pluto
  • Scientists Show Pluto To Be Colder Than It Should Be
  • Astronomers Measure The Most Distant Moon
  • New Horizons Launch Vehicle Fully Assembled For Voyage To Pluto

  • Astronomers Detect Largest Cluster Of Red Supergiants
  • Integral Identifies Supernova Rate For Milky Way
  • Large Survey Of Galaxies Yields New Findings On Star Formation
  • Magellanic Clouds And Dark Matter Warping The Milky Way

  • Apollo Chronicles
  • An Explosion On The Moon
  • SMART 1 Uses New Imaging Technique In Lunar Orbit
  • Moon Storms

  • Galileo GIOVEA Using Marotta Equipment For Its Propulsion Systems
  • SiRFstarIII Featured in TomToms Innovative Portable Navigation Product
  • EGNOS Demonstration In South Africa
  • Europe Opens Up Civil Navigation System With Galileo Satellite

  • The content herein, unless otherwise known to be public domain, are Copyright 1995-2006 - SpaceDaily.AFP and UPI Wire Stories are copyright Agence France-Presse and United Press International. ESA PortalReports are copyright European Space Agency. All NASA sourced material is public domain. Additionalcopyrights may apply in whole or part to other bona fide parties. Advertising does not imply endorsement,agreement or approval of any opinions, statements or information provided by SpaceDaily on any Web page published or hosted by SpaceDaily. Privacy Statement