NASA Johnson Space Center
Oral History Project
Commercial Crew & Cargo Program Office
Edited Oral History Transcript
Sumara
M. Thompson-King, Courtney B. Graham, and Karen M. Reilley
Interviewed by Rebecca Hackler
Washington, DC – 19 March 2013
Hackler: Today is March 19, 2013. This oral history interview is being
conducted with Sumara Thompson-King, Courtney Graham, and Karen Reilley
at NASA Headquarters in Washington, DC for the Commercial Crew &
Cargo Program Office History Project. The interviewers are Rebecca
Hackler and Rebecca Wright.
These three attorneys for the space agency were involved with the
establishment of the COTS [Commercial Orbital Transportation Services]
program, and using funded SAAs [Space Act Agreements] for the first
time to help NASA encourage commercial services. We’d like to
ask you, Sumara, when you first heard about this plan to work with
commercial companies using NASA’s Other Transaction Authority,
and how you went about making that possible from a legal standpoint.
Thompson-King:
I first heard about it when our then Administrator, Michael [D.] Griffin,
proposed that we use our Space Act Agreement authority to see, “How
can we do it? Let’s use it.” We had this Other Transaction
Authority. He had heard from industry that there were concerns about
using our traditional acquisition method of contracts, grants, or
cooperative agreements. He wanted us to look at another way of working
with industry, encouraging industry. How could we do that? He didn’t
have a specific plan other than, “Look at something different.”
What we had available to us are these two words, “other transactions.”
In the [National Aeronautics and] Space Act of 1958, which was in
place at that time—and I remember that section very well, section
203—it identified NASA’s authority “to enter into
[and perform such] contracts, leases, cooperative agreements, or other
transactions” to perform our responsibilities. What did that
mean? There was no guidance.
We’d also had conversations with Mr. [Paul G.] Dembling. He
spoke to NASA on many occasions. There’s an interview that might
be in one of the history offices where he talked about how that language
was drafted. There’s really no guidance about what was meant
by “other transactions.” It was meant to give us flexibility.
We were now tasked with using that language and being as flexible
as we could.
What guided us was the fact that even though the Space Act gave us
that authority, we had to comply with other statutes that were also
in effect at that time. Primarily in the contracts area, it was the
Competition in Contracting Act [of 1984]. Whatever we did using our
Other Transaction Authority could not supersede the Competition in
Contracting Act, nor could our actions supersede what was required
of us in terms of fiscal law and appropriations law. We had to comply
with the Purpose Statute [31 USC § 1301]. All of those laws,
whatever we did, we had to comply with those types of activities.
That was how we got started.
Hackler:
We understand that [Contract] Procurement [and Law Practice] and the
[Commercial and] Intellectual Property [Law Practice] Groups also
had a lot to do with how that Space Act Agreement was put together.
Do you have any input, Karen and Courtney?
Reilley:
The Intellectual Property is Courtney’s area, but we definitely
had a lot of concerns there. Going back to the basic premise that
this really is a partnership, and it’s working with commercial
activities to help them further their own development activities—which
is quite different than we would normally have in a government contract,
where a company is doing work for the government. You had to keep
that premise in mind up-front when you’re thinking about how
you would allocate any intellectual property rights.
Then what existing provisions or—I hate to say “contractual
terms” because that makes you think of procurement—what
you would put on paper to actually implement how to allocate those
property rights. Does that run against any of the other government-wide
statutes, such as the Bayh-Dole Act [Patent and Trademark Law Amendments
Act of 1980] or anything else like that, that we still have to work
within?
Graham:
One of the things that I wanted to point out, too, is that I’m
not sure it’s quite accurate to say that this is the first time
that NASA has provided funds under our Other Transaction Authority.
This is the first time we used this particular transaction structure
to stimulate the development of a commercial capability, but the Agency
does have a history of using something called Joint Sponsored Research
Agreements [JRSA], which is a form of Other Transaction where NASA
would provide money to a partner to support cooperative research activity.
Unlike that situation, this is where NASA is essentially acting as
an arm’s-length investor to stimulate the development of that
capability, rather than working jointly with someone on something
that’s of mutual interest to both parties. One of the things
that I do caution people on is that we don’t know what a funded
Space Act Agreement might look like in five years. It depends on what
the Agency is interested in doing and what our leadership asks us
to see what we can find to do. That’s why the Other Transaction
Authority is so very flexible.
The particular areas on the IP [intellectual property] side that we
had to deal with have to do with the fact that Space Act contains
provisions dealing with the protection of proprietary data that’s
created under Space Act Agreements, and how that data is managed in
the hands of the Agency. NASA is a title-taking agency under the Space
Act, which means that NASA takes title to any inventions that are
created using NASA funds, facility, or property. In most of our partnerships
we make a determination that that title-taking requirement doesn’t
apply. However, in this case, there was a determination made by our
head of Intellectual Property at the time, Gary [G.] Borda, that that
title-taking authority did apply.
That was a topic of a lot of discussion between the JSC legal office
and the Headquarters legal office. They were very vociferous. You
might follow up with one of the IP attorneys down at JSC to talk to
you about that discussion, if you want the background. I wasn’t
here for that, but I’ve read all the emails because they sent
them to me because we continue to revisit the issue. The determination
was made that NASA was required to take title, which means that the
partners have to request a waiver in advance of any invention of NASA
title-taking authority in those inventions. That’s something
that is now kind of accepted by the partners as a matter of course,
but at the time it was very, very controversial.
NASA also gets rights in data under the agreements. The way we handle
that is that we refrain from exercising those rights for a period
of—
Reilley:
Often about five years. It can vary.
Graham:
I think it may have even been 20 years under COTS.
Reilley:
That’s right, we made it longer.
Graham:
We even cut it down for the Commercial Crew Program. Essentially,
when NASA is legally required to take rights, we’re not legally
required to exercise those rights. So we’re able to give the
partners the commercial certainty that NASA won’t be releasing
that information to the public.
Reilley:
I think this was particularly important in working on COTS. As you
mentioned, there may have been five or six other projects where we
have used a Space Act Agreement of one sort or another—transferred
funding, working with partners—all with their own flavor. In
some of those prior ones we had gone through the same sort of analysis.
The title-taking authority had always been there. It was, as I recall,
more of an issue with COTS because of the particular nature of the
COTS project.
Some of the other projects had been, as Courtney said, more collaborative,
more advancing the overall state of technology in a certain field.
Not as much focused on a particular company’s development. So
the title-taking and the data rights became amplified when you’re
talking about a particular company’s commercial development,
rather than some of those prior funded agreements we had done where
even industry didn’t seem to have as much expectation going
into it. It was really advancing particular systems rather than general
state-of-the-art.
Graham:
Right, and the partners that we had in those earlier agreements, too,
tended to be more traditional government contractors, so they may
have had a different expectation than someone who was solely commercial-focused.
I think that the other thing that amplified it for COTS, especially
for the IP, was the fact that COTS went from initial development through
demonstration under a single instrument. Unlike our Commercial Crew
Program, which has actually been phased. You’ll have a period
of time where you’re working on basic concepts, and then you’re
working on systems, and then you’re working on the spacecraft,
until you finally get to something that might take you a little bit
further. Each of those little pieces isn’t quite as onerous
as the entire system being developed under a single instrument.
Hackler:
We also understand that in the use of the Space Act Agreement, you
had to defend that choice in front of Congress and the GAO [Government
Accountability Office]. Can you talk about those experiences, and
how you showed that a Space Act Agreement was needed in this case,
as opposed to a contract or one of the other means you use to cooperate
with outside groups?
Thompson-King:
I’ll start, but I’m going to back it up and talk about—before
you talk about Congress—how we had to explain that to the people
inside the Agency. Going back to a point that Courtney made about
our Other Transaction Authority and our flexibility, we had used it
in various ways around the Agency.
I don’t know that we had any documentation to say, “Here’s
our practice for using Other Transaction Authority, here’s how
we should use it across the Agency.” We didn’t have that
guidance, so each center was using it, or not using it, and they were
doing it as they saw fit. There were, I would say, probably 9 or 10
different interpretations about how to use it, but people were very
careful. I think they were careful about how they used it, because
they were mindful of other laws that we had to comply with.
One of the big issues that Karen, [D.] Eve [Lyon], and I, and the
attorneys down at Johnson—Amy [V. Xenofos], and Jon [Jonathan
A.] Arena was there at the time—had was to explain to people
that Other Transaction was not open-ended and unfettered ability to
do whatever we want, use it in whatever way we wanted to use it. We
had to have a clear purpose. We had to have a fair process for how
we were going to use it, because if we had to defend this outside
the Agency we all needed to be of one mind on how we were going to
use this going forward. So then when we talked to folks outside the
Agency—whether it was industry who was interested in competing
for those resources or getting the award, whether it was Congress,
or the public, or even in litigation—we needed to have a solid,
clear story that we were all supporting.
The first thing that we had to make clear with folks was that we were
not buying something for the benefit of the government. There’s
something called the Chiles Act [Federal Grant and Cooperative Agreement
Act of 1977], which tells us what is the appropriate legal instrument
to use for the activity we’re carrying out, and we have to comply
with that. If we’re buying something that’s for NASA’s
benefit, which NASA needs—buying a [Space] Shuttle, where we
are going to manage the program and we are going to go into low-Earth
orbit—we need to have a contract for that. But if our purpose
is to stimulate industry, to stimulate activity in the commercial
sector, that’s something different. We don’t have to use
a contract for that. That’s not for NASA’s needs.
We had to make sure that the program understood that was what would
allow us to use our Other Transaction Authority. That was challenging.
We had lots of discussions about the IP issues, we had tremendous
discussions about what the purpose was of this activity. We were going,
as Courtney indicated, from development to demo [demonstration]. We
cautioned folks, “This really shouldn’t be an activity
where we’re trying to get something for the benefit of NASA.
When we get to that point, we’re going to have to use a contract.”
There was a concept, and we said this in the first COTS Announcement,
that this is Phase 1. We’re going out with this Announcement
to stimulate industry. Then when we have a need for the government
that needs to be filled, we plan to issue a solicitation that will
result in the award of a contract, because we’ll be getting
services for the benefit of the government.
As we then laid our approach for how we were going to accomplish this,
we had to get folks on board with the notion that it really is a good
thing to have a process. Write out what the rules are, clearly communicate
those rules within the Agency, agree to it, and then communicate it
to the folks who are going to compete. We borrowed a lot from our
experience with contracts.
The first thing that we borrowed was that competition is good, and
we need to be fair. That was, frankly, I think, our guiding principle
through the development of the procedures for how we conducted the
COTS competition. There was competition, and we laid out what our
plans were for proceeding. We stressed to them that this was helpful
to us, internal to the Agency, to make a good decision. It also would
help us if we ever did get into litigation or had to go outside and
explain. Let’s show folks, “Here’s our plan for
how we’re going to do this.” Here’s some things
familiar to you from the procurement world. Competition, here is a
solicitation.
But we didn’t use procurement terms because we wanted to make
sure that this was not subject to any procurement regulations. We
don’t call it an RFP [Request for Proposal], which is a term
found in the Federal Acquisition Regulation. We called it an Announcement.
We did not call the person who managed this effort a contracting officer.
It’s an agreements officer. We wanted to make sure there was
a split, and the people who worked on this—even though they
had procurement backgrounds, this was a different type of arrangement,
and we made sure that we kept those folks separated.
So by the time we had to explain this to folks external to the Agency,
we had a very clear process that was supported by those in the Agency
who understood what our purpose was. Every once in awhile we’d
have to remind people and bring them back in line, but basically that
was the process we followed. Then there were some challenges. Karen,
I can continue talking or I can let you share your thoughts about
the challenges.
Reilley:
Sure. I got to work on both of them. The good segue from what Sumara
was just saying is that not only did we need to come up with a process,
educate ourselves and the rest of our own internal community, but
document that. We made sure that we had a good record, literally on
paper, of the decision-making process that we had gone through. Things
that we had considered, why we were doing this, what we hoped to achieve
by it, what our relationship with industry would be, what this was
not.
That became important not just for our own internal planning process,
but some of that also became invaluable when we did have two challenges
at the GAO on these funded Space Act Agreements. On the original one
that we did, and then we competed about a year later on the second
one [after the October 2007 termination of the Space Act Agreement
with RocketplaneKistler]. Both of those successful, fortunately, but
a large part of why we were successful on those protests was because
we did have not only a rationale and a process, but the contemporaneous
documentation to show that we weren’t explaining what we did
after the fact. We had the record to back that up, and that became
very, very helpful. They actually quoted that in some of the GAO decisions.
Hackler:
Can you talk a little bit more in detail about those two GAO cases?
Reilley:
Sure. The first one, that was the Exploration Partners [LLC] case.
That was filed after we had made the award of the funded Space Act
Agreements. The main point of that case was whether GAO had the jurisdiction
to hear a case like that or not, since it was not a contract. The
main point coming out of that decision was GAO saying that we really
do not think that we have jurisdiction to hear this, because this
is not a contract. Therefore, we, GAO, are not going to opine on whether
the Agency did or did not use this appropriately.
The door that was left open was if it was a protest of whether they
had used the authority appropriately or not, whether it should have
been a contract—that would have been within GAO’s jurisdiction.
For the Exploration protest, it was too late for that. The decision
had long since been made, the process had been gone through, and the
award had been made.
The second time, the protest happened before we had made the awards.
That was the RocketplaneKistler protest, RpK. That protest actually
was about whether we were using the correct type of authority, whether
this really should have been a procurement with a contract or a Space
Act Agreement was acceptable. That’s where it was particularly
useful that we had all that documentation going back not only through
that round of the COTS competition, but back to the original COTS
competition a year or so prior explaining that process that Sumara
was just telling you about. That was our saving grace in winning that
protest, being able to show that record of how we had made the decision.
Hackler:
Thank you. That was a very thorough, clarifying explanation. Putting
together these Space Act Agreements, you also worked with the commercial
companies. Were there any specific inputs you got from them on how
to make the Space Act Agreements friendlier for their use?
Thompson-King:
Yes. I’m doing this from memory, but we had a process where
we did release a draft of what we were thinking about doing. This
was the first time we’d done this on such a large scale. As
in the procurement world, we released draft RFPs so we could get input
and also give some early indication to industry of how they should
be planning to develop their proposal that they’re going to
submit. We did some similar things with industry under the COTS competition.
I believe we released a draft, we received comments, and then we incorporated
those comments into the document that became the final Announcement.
Graham:
That became the final Announcement. I think we probably had an industry
day, although I don’t particularly recall. I’m assuming
we must have. When we issued the Announcement to get proposals for
the competition, it had the draft of the Space Act Agreement. It was
what we had put together as sort of our final model of it. We also
left open the opportunity for each company that submitted their own
proposal to also comment on the terms and conditions that we had in
that model Space Act Agreement. It didn’t have to be word-for-word
exactly what we put in that model, there was some room for negotiation.
And we did have extensive negotiation with a number of companies.
With some companies, surprisingly not all that much. Other companies,
days of discussing with them, down to commas and semicolons, as well
as the big terms in there on what the particular terms of the Space
Act Agreement should be. Leaving open the possibility that it could
vary a little bit from company to company as well. If someone had
a particularly compelling rationale based on their particular approach,
we were certainly open to hearing that. I’d say probably more
of the negotiation happened once we had potential competitors who
wanted to talk specifics about the agreement.
As I remember, we got more feedback—or maybe I just remember
that because I remember sitting at the table for days with the particular
companies, negotiating with each one. We got a lot of very good input
there, which obviously was helpful for that competition, but it also
gave us other things to think about when we did the second round of
COTS. We’ve since gone on to do other funded Space Act Agreement
projects, and we’ve built each time on some of the comments
we got back from industry.
Thompson-King:
I apologize, because my email from this time has disappeared. One
of the things I’m recalling are the numerous conversations that
we had—we the lawyers, we the procurement folks here at Headquarters—because
a lot of this activity was going on down at JSC. The procurement folks
and the legal folks down there were encouraging our program folks
to talk with industry, and we know they were talking with industry.
At that time it was very interesting because we had two different
industries that were communicating with NASA and sharing their thoughts
with us. That was the traditional industry, the large companies who
had been in the space business for years—[The] Boeing [Company],
Lockheed [Martin]—and then you had the new companies. “This
company called Space Exploration [Technologies Corp. (SpaceX)]. What
exactly have they done?”
You had people pulling at us in different directions about how we
were going to issue this Announcement. What was going to be the focus
of it, how were we going to evaluate the proposals that came in. There
was a lot of informal industry communication with the program. We
would hear about it because folks would contact us and ask us questions
about how we were developing our evaluation plan, our process for
how we were going to evaluate those contracts. There was a lot of
industry interaction. Probably more so with the folks who were in
the program office, and there was definitely input. We assessed that
input, but we ultimately, in the Agency, made our own decision about
how we were going to proceed.
Graham:
I was going to make two points. It was during COTS that we also came
up with the idea of continuing to work on an unfunded basis with unsuccessful
proposers. As part of the overall purpose of the program being to
support the development of commercial capability, even if someone
didn’t get a money award, they could still leverage NASA’s
technical expertise and work with us. And we’ve carried that
forward to our Commercial Crew Program now. Some of those folks went
forward, a lot of them fell off the table.
The other point I was going to make was that even though we went through
this process of developing and negotiating the agreement, the relationships
continued to evolve. Each of those agreements got amended or modified
several times as the relationship changed, or different aspects of
the relationship became important to address, that sort of thing.
The agreements were not static, even once they were negotiated.
Thompson-King:
Let me make a point about the point Courtney made, which is really
very unique and probably something folks will really talk about. It
was a novel concept to go out with a competition, select folks who
were going to receive funding, and then select entities that weren’t
going to receive funding, but who were going to have a relationship
with NASA. We had a number of robust conversations about just that.
We had not done that before, because if you think about the contracting
activities that the Agency had engaged in, you issue a solicitation,
you get proposals in, basically somebody wins and somebody loses.
You may have multiple awardees, but you don’t have somebody
else who continues having a relationship with NASA.
Having these unfunded agreements was really something new and different,
and we talked a long time about how you select those folks, how you
treat them fairly. Do we have the resources in the Agency where we’re
going to be working with what ended up being two companies that were
selected for funding? Do we have enough people who can work with those
two companies and then support the activities of those who had unfunded
agreements with us? We ultimately decided to do so.
There was a lot of robust conversation, and as I’m recalling,
Alan Lindenmoyer was the lead on this. He was insistent that was something
that was very important to him, because remember what we said in the
beginning. This is to stimulate industry, so having those unfunded
agreements would keep those folks in the game. They may not be as
advanced as those who were selected for funded opportunities in their
approach, but we wanted to keep them interested and wanted to support
their efforts. That’s why those unfunded agreements were important.
Hackler:
How did you cooperate with your colleagues at JSC, both on the legal
side and with the program office that was managing it? How did you
divvy up responsibilities, and do what was best to stimulate these
commercial industries?
Thompson-King:
At that time, I was head of the contracts division here, and I had
one attorney here at Headquarters, Eve Lyon. What we typically would
do was our office would provide legal advice to the procurement office
here at Headquarters. We depended on the procurement office at Headquarters
to work with the center folks. Then we had a kind of dotted line,
we the legal office here at Headquarters to the legal office at JSC.
We took that model and applied it to the COTS process. Eve Lyon was
assigned to be the principal attorney here at Headquarters who worked
the day-to-day issues that would come up. Down at the Center was Amy
Voight—this was before she married—and Jon Arena was also
there, they were the two primaries. Karen Reilley was also there.
We had other attorneys who would come in and out. Scott Barber I think
was in Exploration [Systems Mission Directorate], ESMD, as lead counsel.
Bill [William J.] Bierbower—
Reilley:
I actually ended up being on both sides [Headquarters and JSC], but
for the first round I was here, and we had quite a team here. There
was a group that would go down the hallway whenever we had a meeting,
because Eve was coordinating it. Bill was leading a lot of the effort
because he was the lead counsel in Exploration at the time. That would’ve
been when I was in the CFO’s [Chief Financial Officer] office.
That was how I was brought into it, because I did a lot of the fiscal
stuff. I was in the procurement group here but had done many, many
years of Space Act Agreements at other centers. We had the IP folks
here, we had Gary, we had property people, and we even had some of
our personnel lawyers as I remember. It really was a very collaborative
effort there.
Thompson-King:
Yes.
Reilley:
The short answer to how you interact with the field centers, having
been on both ends of it—lots and lots of having your head glued
to the phone. You just continually talk to each other. I found that
when we did the second round of COTS, and I was the field center attorney
at Houston at that point. It was the same sort of relationship. You
are just constantly talking about the day-to-day issues that come
up. Same with your program, you live with the program to make sure
that they’re getting the support that they need.
Thompson-King:
Frankly, we were a very good team. What I think I remember most is
that people put their egos at the door. We all shared information,
the lawyers at Headquarters and lawyers at the Center. There’s
always a challenge in the relationship between Center attorneys and
Headquarters attorneys, because they’re supporting the folks
down there.
Sometimes there are discussions that the program wants to have just
at the center and not include Headquarters in, so I respect the actions
of the JSC attorneys in making those judgment calls when they needed
to bring us in, and when “We don’t quite need your help
at this point.” Overall I think it worked out very well. I think
also there was a similar-type of activity with the procurement folks
who were in office at JSC who were assigned to work this. The coordination
that they had with the procurement office here at Headquarters.
Reilley:
I think the involvement of the procurement personnel was very helpful
because even though we were very clear that this was not a contract,
it’s not procurement, this staff has a background and an expertise
in the process, in the competition, and in interacting with industry.
It gave a good foundation to model off of for the COTS competition.
We always try to find that balance of “Don’t go down the
path as if this is indeed a procurement, but use what you can of that
model.” It gives you some good things to work with, and it gives
you people who are used to working in a competitive atmosphere.
Thompson-King:
As Karen said, the thing that I will forever remember on COTS is before
we had the work from anywhere—it was Christmas. My family is
in Texas, and I remember being in my cousin’s living room on
the phone with the folks at JSC talking with them about this. We were
struggling about getting the Announcement out, and what was going
to be in it. We had one telephone call in the morning, and we had
one in the afternoon. As Karen said, it was constant communication
with them through the holidays. I don’t think anybody really
took a day off. Even if you were off, you were on call, and everybody
participated. That was not just the attorneys, but the folks from
the procurement office, the program folks. It was a very busy time,
very, very busy.
Wright:
If I could ask—it’s not like this was the only thing that
all of you had to do. What was the push? What was the mandate that
you had been given about why this needed to go through so quickly,
even through the holidays? Why was this such a priority?
Thompson-King:
We had a gap of when we were going to have our own vehicle available
to go to the Space Station.
Graham:
We knew that the Shuttle was going to retire in 2010, and we were
looking at a 2012 date, I think, for Constellation [Ares rocket and
Orion Crew Exploration Vehicle] at that point. This was in 2005, with
the award in 2006. The perceived need was to get people started so
that we would have them online by 2010, which didn’t work anyway.
Wright:
Your understanding was that this was a necessity to help provide supplies
to the Station?
Graham:
Yes.
Thompson-King:
Ultimately. Because the first part of this was to stimulate commercial
industry, so there would be that capacity and an available resource.
We were then going to buy that. In order for us to have something
to buy, we needed to get it developed and demonstrated. That was the
driving force.
Graham:
That’s why it’s so hard for people to get their mind around
this idea of having a clearly articulated purpose for this, that was
something other than acquiring a service for NASA. And we still have
that conversation with people. I just had a conversation a month ago
with someone explaining funded Space Act Agreements and what they
were for. They were like, “That doesn’t make any sense.”
I’m like, “Well, it actually does.”
This idea that there could be something that NASA needs, but that
we’re using an instrument that’s not directed towards
meeting that need, creates a lot of cognitive dissonance for people.
They want to bring those requirements into that relationship, even
though that’s not the appropriate place for them to be. You
need to transition to a contract in order to bring those requirements
online.
Even though there was this idea that NASA eventually needed the capability,
that need was not being addressed by this instrument. However, we
wanted to be in a position to support the development of the capability,
so that they would be there to compete for a contract when we needed
to make that award. Because it wouldn’t do any good to put out
a solicitation for cargo services if nobody can provide them.
Thompson-King:
And there was a true need. Not just for NASA, but for the commercial
sector. Because we didn’t view COTS as just supporting NASA.
It was to develop a commercial sector so that others could use those
services. We thought that there would be other entities, both in the
government and in the commercial sector, that would use those services.
I know that was hard for some folks to imagine, because they said,
“No, you’re really just doing this for NASA.” No,
we weren’t, because we had a Vision, and it was clear that there
were going to be some opportunities for these companies to provide
services to the commercial sector. I think we’re seeing that
now, when you look at the manifest that SpaceX has planned for their
launches.
Graham:
That goes to Karen’s point about having that documented in the
record, in advance and not after the fact. Because it’s a discussion
we still have with people today. They’re like, “Oh, we
all know that we did COTS for NASA,” wink-wink type of thing.
No, we really didn’t. We have an established record that showed
what the purpose of the activity was and how it was different from
what you would do under a contract. Trying to get people to understand
that this wasn’t just something that somebody woke up and decided
to do, and it’s an Other Transaction and you can just go do
it—people don’t really understand the amount of work that
went into navigating the challenges that it presented.
Hackler:
Since we’re on the topic of the follow-on procurement to COTS,
the Commercial Resupply Services [CRS] contract was awarded in December
2008. What was y’all’s involvement in that, if any? Were
there any challenges to it?
Reilley:
Yes, we were all very involved in doing that as well. Actually, I
was the lead attorney on it at JSC, and Eve was the attorney here.
Eve and I spoke together all of the time on that project. That was
actually a procurement, that was a contract. You’re now following
the CICA [Competition in Contracting Act] rules, you’re now
following the normal procurement approach.
That in and of itself was a challenge to work with, because you’re
working with a lot of the same NASA organizations and programs that,
as Courtney said, have just gotten their head around the COTS model.
Now you have to re-vector them a little bit to say that what you’re
planning to do for a Commercial Resupply is actually a procurement,
and you will need to use the procurement process, and you will need
to keep it separate from the ongoing Space Act Agreements that had
been awarded and were in progress and being implemented.
You may have many of the same industry people interested in both.
Those who are participating in COTS with funded or unfunded Space
Act Agreements, and industry that is not participating in it but might
like to compete for the contract, which needs to be open to everybody.
How do you plan your procurement, taking into account what you’re
doing, without building your competition around what your Space Act
Agreement partners are doing? How do you keep it actually an open
competition, not built on particular partners’ progress in the
Space Act Agreement? Even keeping your people separate, so you can
have two different activities going on at the same time without having
any conflicts or information problems.
We also ended up doing the CRS contract several years earlier than
we had originally anticipated. We had originally thought that most
of the development and demonstration type of activity that industry
would be doing under the COTS program would have been, if not completed,
significantly further along. That was part of the whole premise of
COTS, that it was the development stage, and then we’ll see
what happens. Hopefully industry will have come up with capabilities
and we’ll be able to initiate procurement because there’s
now a market for it.
As it turned out, when you start looking at the enormously complicated
effort it takes to actually put together and launch a spacecraft,
and plan for the services, and do the planning that you need to do
for any ISS [International Space Station] mission, that takes quite
awhile. We needed to think of how far we needed to back up, starting
that procurement. Again, not tied to what the COTS partners are doing.
Some may or may not have preferred that we had done that further along,
but you had to look at when is the optimal time to start your procurement
planning so that you get what you need at the end result. That accelerated
our planning on that project by a couple of years at least.
Thompson-King:
Karen gave an excellent description of what we thought about. The
challenge for us, that we recognized, was that when we moved up the
date for CRS, some folks were going to have the impression that, “Oh,
what you’re really doing is turning COTS into a procurement.
That’s the wink-wink.” We had a tremendous task in making
sure that the COTS effort stayed separate from the CRS effort. People,
language, resources—we put up a firewall of sorts to make sure
that, as much as we could within the Agency and external to the Agency,
they were viewed as different processes.
They were, but that was very much an issue in the beginning. There
were a lot of us, including me, who were very concerned that to those
outside the Agency—and we talked about this with Gerst [William
H. Gerstenmaier, Associate Administrator for Space Operations Mission
Directorate] at that time. You may give the impression, by starting
this early, that you’re really using COTS dollars to fund the
contract effort. You’re going to have some people out there
who are going to challenge us and say that we’re blending the
two, that they’re one and the same. That was very much a challenge
for everybody who was involved in the process at the time.
Graham:
Do you want to talk about the protest that you got on CRS?
Thompson-King:
Yes, I was going to mention that if Karen didn’t. We did have
a protest, and Karen’s recollection is probably a little better
than mine. CRS was protested to the GAO, which it could be because
it was procurement. Vincent [A.] Salgado at the time was the lead
attorney who handled protests when they went to the GAO. We were challenged
on the award of that procurement.
Reilley:
It was a company that had submitted an offer, and had not been accepted,
and protested the decision.
Thompson-King:
Yes. For us, the significant issue was not so much the protest, but
the override decision that we made. That was the big issue there.
So what is an override decision? In the statute regarding protest,
once a protest is filed, at the time they protest agencies are required
to suspend performance and any activities on that acquisition. It’s
called the “automatic stay.” You stop all activity, it
halts the process. Folks in the program offices hate protests, because
of that automatic suspension. We have to cease activities and we just
focus on the protest.
GAO has to issue a decision 100 days after the protest has filed.
It’s a short period, but if you’re in a program on a very
tight schedule, three months is a long time. There is a provision
in statute that allows an agency to make a decision to override that
requirement to suspend performance. GAO has no oversight or overview
of that decision. The company can’t then go to GAO and say,
“We think the agency is wrong in issuing this override.”
However, the company can challenge in federal court.
NASA was looking at the schedule, and Karen articulated so well why
it was important for us to push CRS forward. We needed to keep it
going. We had a schedule to meet, we needed to get to the ISS by a
particular time. There was concern about whether, if we did not have
launch occur by a particular date, we could get supplies up to those
astronauts who were on ISS. We carry water up there, we carry food.
It wasn’t just research. It was really sustaining the life of
those on the Space Station and continuing the program.
Bill Gerstenmaier made the decision that he wanted to override the
suspension, so we had to draft a justification in the agency explaining
why we believed that was necessary. Mr. Gerstenmaier may remember
this a little differently than I did. I remember Bill thought, “Okay,
we’ll get this done in a couple of days.” I think when
we look back, it took us about 20 to 30 days to write it, because
we knew that what we wrote in that document was going to go to a judge
who was outside the Agency. We had to really lay out our internal
deliberations, our thought process, and what the basis was for the
decision.
This was not a two-paragraph document. Frankly, many program folks
were really of the opinion that we could tell NASA’s whole story
in two paragraphs. We, the lawyers, really had to work with them to
explain, “No, you’ve got to tell your story fully. You’ve
got to show how you deliberated, how you weighed things, and how you
ultimately reached the decision you made.” That’s not
going to be in two paragraphs. You have to make sure that the facts
that you articulate in this document can be supported.
That’s why what Karen said, and Courtney’s mentioned about
our record—it was so important that we had that in this override
document. At that time, our General Counsel, Mike [Michael C.] Wholley,
did not typically review acquisition documents. I was generally the
last attorney, the senior level attorney who reviewed an acquisition-type
document. He reviewed that document as well, because we knew how significant
that document was going to be for the Agency.
What the Department of Justice [DOJ] told folks years later, after
that case went to court, is that DOJ does not typically support agencies
who are pursuing override decisions. They basically will read what
the agency has provided them, and might go back and advise the agency,
“This is not something that we can support.” Or if it
goes forward, and they do support the agency, DOJ will let you know
that you only have a 10 to 20 percent chance of being successful.
We knew that it was going to be very difficult for us to be successful
in the Court of Federal Claims, in having a court uphold our override
decision. Not only did we coordinate within the Agency, we did talk
to DOJ and let them know we were doing this. This was coming, did
they have any insight? They gave us cases to read. We read those cases,
and incorporated some of that language into the override language.
I can’t remember how many attorneys, there must have been eight
of us—
Reilley:
A whole group, as always. Everything involving COTS and CRS is done
by group.
Thompson-King:
Yes, it was. Everybody got their input. I mean, we were changing some
“buts” to “ors,” but we knew that this was
going to be an important document. Gerst made the decision to override.
The other thing is, when you go into court—this was all still
new for us. Going to the Court of Federal Claims, it’s not a
trial court. It’s all a paper record. That’s also why
the record was important.
Gerst was not likely to have the opportunity to go in and testify,
and explain what he meant when he signed this document, and he censored
things. They weren’t going to give him that opportunity. This
is your one shot. That’s the other reason why this had to be
so detailed. That was it. There was not going to be any other opportunity.
We also had to put it in Gerst’s language. “Do you agree
with everything that’s written here? Can you support it? Is
it all truthful?” Because what we didn’t want was for
that to go over to the court and they come back with a statement which
we can’t back up.
We issued that override decision, and it was challenged in the Court
of Federal Claims. The judge in that case agreed with NASA and supported
our decision to override. That was the first time in my career here
that we had first of all, issued an override, and then had a court
to uphold our decision.
Wright:
Good job.
Graham:
I’ll make the observation that given all of this work that you’re
hearing about, there’s still a perception in the Agency that
COTS and CRS is a model, that you just get a Space Act Agreement and
you transition into a contract. It just kind of happens. The Space
Act Agreement sprung fully formed, and then we just move those people
over to a contract. It’s not like that at all, by a long shot.
We’ve had people say, even recently, “Oh, you can’t
protest the Space Act Agreement.” It’s like, “What
are you talking about? We had two protests. We got protested both
times.” I think this office was so successful in defending the
Agency, that people who weren’t involved don’t have a
perception of the difficulties that we faced in implementing the model
that we did.
Hackler:
You mentioned before RpK’s termination and their challenge to
it. A question, I think for you Courtney, is what happened to their
IP after the termination? Has there ever been an attempt to use that?
You did work so hard to make these intellectual property provisions
part of the SAA.
Graham:
As a practical matter—I’ll back up and talk about the
agreement structure again. The IP provisions only cover the IP that’s
developed under the agreement. If the partner is doing work outside
the agreement, that IP isn’t covered. NASA can really only utilize
the physical things that are provided to us. They could have a hundred
documents, and if we only get five of them as part of a milestone
review, there’s no sweep up delivery obligation at the end of
a Space Act Agreement.
Even though NASA had the right to exercise the IP, we never have.
I don’t think we addressed it, because we never formally settled
with them on the termination that I recall. I worked with you [Karen]
and Jon Arena on terminating the Space Act Agreement, and it was really
a series of discussions about whether NASA would formally exercise
the rights it had under the agreement.
RpK had kind of run out of money in the 2007 stock crash. That’s
what impacted their ability to perform; it was not technical issues,
but financial issues. They actually stopped technical progress because
they weren’t able to raise funds. There really wasn’t
an incentive on the part of NASA to penalize them for what was really
an externality that prevented their performance. I believe we probably
worked with them for better on a year, maybe longer, before we actually
terminated the agreement.
I think that the push was that we really aren’t seeing that
you guys are going to get the money that you need, and so we need
to bring in another partner. That’s when we had the second competition
that Karen talked about, where we actually had the RpK case. It was
RpK that challenged the use of the Space Act Agreement, even though
they had been a beneficiary of that in the first one.
People are surprised when I point out, when we talk about this sort
of COTS/CRS model, that Orbital [Sciences Corporation] was actually
awarded their COTS agreement in February of 2008. Then the CRS contracts
were awarded in December of 2008. If you back that up and look at
the solicitation periods, this was all going on contemporaneously
really, Orbital participating in both sides.
So there really couldn’t have been any performance by Orbital
under COTS that could’ve influenced their selection, because
their proposal had to go in I think a month after they got the COTS
award. If you think about the fact that the technical goals of both
efforts were similar, you would think that anyone who would be successful
in one is likely to get highly scored in the other, so it really wouldn’t
be a surprise that you’d see the same group of folks involved
in those competitions.
No, we never exercised the IP. That’s the only default situation
that we’ve had, I think. NASA has some rights, even in the event
of a successful completion. It’s just not in our interest, and
there’s not a lot you can do with random bits of data that get
delivered to you. It’s kind of contrary to the purpose of the
program, if it were to penalize those commercial folks.
Hackler:
Karen, earlier you mentioned that in working with the commercial partners
and doing these negotiations, there are a lot of things you learned
about the use of SAAs. I was wondering if you all could talk about
how their use has evolved. What lessons you may have learned that
you could apply to either the second round of the COTS competition,
or how you utilize Space Act Agreements now.
Reilley:
Their use has evolved, as Courtney said earlier on, from 15 years
ago. We’ve used them for a variety of purposes. I don’t
know that lessons learned from COTS really affected how we may or
may not use them in the future. I hope we will come up with yet more
inventive ways to use this wonderful authority that we have, and we’ll
hopefully someday have Other Transactions that might bear no resemblance
at all to what we’re doing now. It’s just another way
to use our authority.
I think what the negotiations with partners did—it’s much
more of a negotiation than I recall ever having had on, say, contract
terms with potential offerors. You’re hearing why they’re
concerned about certain terms in a Space Act Agreement that, after
years of working on negotiated procurements, you don’t really
hear as much. They might be talking about aspects of their proposal
in a competition, but they’re usually not really getting down
into the “Why does the term of the agreement have to say this?
Why can’t it say that?” That doesn’t happen as much,
and that happened a lot with the funded Space Act Agreement.
It made you think about, “Why did we put this in here, and can
we change it?” Let’s get to “Should we change it?”
later, but let’s actually think about, can we do this differently?
Is there a strict legal requirement for it, or is it just something
that we’re used to doing? I think that was more the process,
rather than anything in particular. I can’t think of any particular
term or condition that we certainly do differently as a result of
those negotiations.
A lot of it was making us think about how we build them, including
maybe things that we should’ve put into some of them that we’ve
subsequently done, that we didn’t put in the original COTS agreements.
The lessons learned in implementation, as Courtney mentioned, things
that neither side really thought about until you’re progressing
in the actual implementation.
Hackler:
Do you have any examples of some of those implementation issues?
Graham:
One of the things was use of government property. The idea of GFE
[Government-Furnished Equipment] was very common in the contract context,
but we don’t have a concept of GFE in Space Act Agreements.
One of the things came up to say, “We’d like to use test
articles that NASA has in order to be able to do mock-ups of our cargo
configuration.” Can we use bags and straps, and whatever it
is the astronauts are trained on so that they can work with common
equipment? We had to go back and think, “Can we do this?”
Is there a concept of GFE, or this is supposed to be a commercial
activity? Do we make them figure out how to acquire their own for
this?
We did determine in that case that we can loan them that property
to use. We had situations where the program wanted to give things
to the partners in order to facilitate their demonstrations, and we
determined that we didn’t have authority to transfer title to
a Space Act Agreement partner. Where in the contract situation there
might be an opportunity for a contractor to acquire a title during
closeout and be able to actually own that government property. That
was an example of, “We want to do—” and we had to
go think about it and come back.
One of the things that has evolved too, is NASA originally, in addition
to the IP, we said there’s two things that come out of this.
There’s going to be IP that’s generated with NASA funds
under the agreement, and there’s going to be property that’s
acquired with NASA funds under the agreement. One of the things that
we looked at was the reacquisition of partner-acquired tangible property.
Nobody really wanted to buy their stuff at the end of the agreement,
so as we transitioned into commercial crew that sort of evaporated.
It really has become less and less of a focus, although it was very
much up-front for COTS.
Another thing that has evolved into a little bit stronger approach
is guidance for the centers about how they relate to the partners,
as the partners look for support from other parts of the Agency. A
lot of times they were reimbursable Space Act Agreements. We also
have centers that would talk to partners about including center activities
in the partners’ proposal, and how the centers could interact
during the equivalent of a procurement blackout.
Then, what NASA wanted our relationship to look like with those partners.
If the purpose was to develop a commercial capability and not some
augment of NASA’s own capabilities, what did those relationships
look like? That’s something that’s evolved quite a bit
over time. I think you had sort of the blackout approach during the
first COTS, but there was really no guidance until we got into commercial
crew as to what those relationships would look like, and whether there’s
any type of support that was off the table.
Thompson-King:
For me, I won’t say they’re lessons learned, but lessons
to be learned. Things that we’re going to have to deal with
as we continue to use our Other Transaction Authority. I remember
Karen, Eve, and I sat down and, being lawyers, litigators, said, “If
GAO doesn’t have jurisdiction, who has jurisdiction?”
This is still an outstanding issue that we are going to have to deal
with. Particularly if we use more of these. While we’ve had
protests about whether this is an acquisition or not, we may one day
get an actual challenge of, “Did you make the right decision
using your Space Act authority? Did you have a fair competition?”
Where can they voice those concerns? What we have had in COTS, and
it’s continued through the subsequent announcements, is an ombudsman.
The folks can go to that ombudsman to bring their concerns. What’s
happened lately is that the ombudsman has been very busy. We’re
happy about that, because that means that it hasn’t gone into
court. What’s outstanding for us is what’s going to happen
when we get that first case that goes into court. Right now there’s
still some debate, because we don’t know.
Which court is going to have jurisdiction? That’s an issue.
In the court system, most folks know about the federal courts, the
district courts. There is the Court of Federal Claims, which just
handles contract claims. Is that court really going to be court that’s
going to hear Space Act Agreement issues, or is it going to be a district
court? The district court would be district courts all around the
country. That’s something we’re going to have to deal
with, and we’re going to have to really have conversations with
the Department of Justice about how we want to handle that case, and
how we’re going to argue it. It’s going to have ramifications
for the Agency from that point forward, so we have got to think about
that particular issue.
Another issue is when we are going to be using government money, people
start taking notice. This is still novel, but if we keep doing this,
one of the things that some folks have expressed a little bit of concern
about is small business. In the contract side, there are requirements
for encouraging the use of small business. We don’t necessarily
have that on the Space Act Agreement side, we don’t have a requirement.
Graham:
It’s in the [1958] Space Act, we just don’t think about
it.
Thompson-King:
We have kept that at bay, but as we continue to use Space Act Agreements,
we may get more of a push from the small business community asking,
“Where are the opportunities for us?” This is a development
opportunity. They’ve been riding that out, and they see opportunities
in the contract area. When we have a COTS, it’s going to evolve
into a demo. Then when we buy the services, that’s when you
will have your opportunity to work with those companies.
Some small businesses are hearing that, but they’re still looking
at all those dollars that are going under a funded Space Act Agreement
to that particular company, and are they really going out and using
resources provided by small businesses. We’re not saying they
aren’t. They want more participation in that, and I think that’s
something that we’re going to have to look at in the future.
That’s going to be interesting.
Graham:
Right. I was going to follow up on that. I think that Karen’s
spectacular success in the RpK protest has created some complacency
within the Agency that our authority to do funded Space Act Agreements
is pretty much settled. The thing is that protest was a factual determination.
For that particular competition, NASA was able to prove that we used
the appropriate instrument for what our purpose was. That does not
mean that the next one we will be able to make that showing.
That’s why we’re continually harping on our clients about
the record. It’s difficult when you have [NASA Administrator]
Charlie [Charles F. Bolden] going out and giving a speech, trying
to talk in shorthand about how we’re partnering with these commercial
crew folks to take people to the ISS. That’s the type of thing
that, when you get into one of these litigations, will undercut your
ability to establish that no, these are not actually for NASA requirements.
It’s a challenge that we have, because we don’t like to
be the thought police, and the word police, and go around and tell
people what they can and can’t say, and argue with PAO [Public
Affairs Office] all of the time. But there is this sense that, well,
the fact that we can do these is done. They don’t realize that
was a specific question on that particular competition on that particular
record, and we will need to do that again and again and again, if
we get future challenges.
Hackler:
We understand that NASA has procedural requirements on the use of
Space Act Agreements. What was your input to those, or did you help
put those together?
Graham:
Where we are—we have what we call a Space Act Agreements Guide.
It covers reimbursable and nonreimbursable agreements. It covers international
agreements, and it covers interagency agreements. It does not currently
cover funded agreements. There was a chapter that was in the guide
that allegedly covered funded agreements. It had two paragraphs that
said, “Go talk to your legal folks.” Then it talked a
lot about interagency acquisitions, as if those were funded Space
Act Agreements and not Economy Act Agreements.
We said, “This is actually causing more trouble. It’s
doing more harm than good having incomplete and inaccurate guidance
that doesn’t really track where the Agency is now.” So
we pulled that out of the guide. It’s available as a superseded
chapter on our website if people want to look at it, but it’s
not part of our official guidance.
We have received direction from GAO to draft guidance. That’s
being implemented in coordination with updating our acquisition strategy
process development to bring funded Space Act Agreements into that
ASM [acquisition strategy meeting]/PSM [procurement strategy meeting]-type
of framework. They’re not ASMs and they’re not PSMs, but
the idea that we have a parallel process to how we plan procurements,
that’s officially implemented to do funded Space Act Agreements
as well—to create that rigor in the process. As that policy
is being developed, that will feed into the guidance that’s
developed. It’s hard to write guidance if you don’t actually
have any policy to guide on. That’s where we are with that.
Hackler:
We’ve got about 10 minutes left. I wanted to see if Rebecca
had any more questions.
Wright:
If you could talk a little bit about your discussion about liability.
Where does it fall when you do a Space Act Agreement? How much does
the government take, compared to the partners?
Reilley:
The particular funded Space Act Agreement we’re talking about
here, the COTS agreement, does have provisions in it that flow down
from our IGA, our Intergovernmental Agreement that we have with our
International Partners for the Space Station. It requires that the
Space Station partners—ourselves and our other international
countries—waive claims against each other. Won’t sue each
other, so that we can cooperate without worrying about suing each
other over damages to very expensive equipment.
Each government has to flow that down to its partners, contractors,
whatever you might call them. That does get into the COTS agreement,
that’s why it’s in there. We are required to flow that
down. There is a provision in there that the commercial companies
that work with us under the funded Space Act Agreement must waive
any claims, i.e., they cannot sue our International Partners or their
contractors. That relates to what we call Protected Space Operations,
which is fairly broad, but it’s not anything and everything.
It has to do with things that are part of Space Station activities.
That’s a very generic, non-international lawyer way of saying
it.
That does leave open other possible areas of liability that fall outside
of that scope. The FAA [Federal Aviation Administration] has licensing
authority for launches and reentries. For COTS, we did say that this
is a commercial endeavor so you need to talk to the FAA about having
your activity licensed. That comes with certain liability regimes
as well. That actually has nothing in particular to do with NASA.
That’s required by various statues and regulations through the
FAA about waivers of claims, insurance indemnification. All of that
would apply to our COTS partners, not because of our Space Act Agreement,
but because of having to obtain an FAA license for that.
Graham:
Then we have the unilateral waiver.
Reilley:
We have the unilateral waiver that we often have in our Space Act
Agreements, where we’re requiring the partner to waive claims
against us. That we are providing funding to help facilitate their
commercial activities, and part of that is that we do not expect them
to sue us over it. It does have the unilateral waiver in that sense.
Wright:
I referred to it as a partner, but is that a term that you use when
you talk about the commercial relationship?
Reilley:
Yes.
Thompson-King:
That’s the term.
Graham:
Definitely, partners. It’s funny, because it took us a long
time to get people to not call them contractors, and to call them
partners. Now that we’re transititioning into contracts for
commercial crew, they still want to call them partners even when they’re
under contracts. It’s a little bit of an adjustment for folks.
Wright:
Are you starting to hear that there’s more of a shift to move
from contracts into SAAs?
Graham:
You can’t move away from contracts into the SAAs, because they’re
for different purposes. You could choose to structure your program
to meet different purposes, if you want to do that. I just want to
be clear on that. They’re actually through the Office of Strategy
Formulation in the A Suite [NASA Administrator’s office], which
is headed up by Rebecca [S.] Keiser. It actually has teams looking
at potential technologies and industries that could benefit from COTS-type
investments.
That’s one of the challenges that we have, because they have
this “COTS/CRS model,” is what they call it. Which, the
CRS part isn’t actually part of the COTS, and one doesn’t
necessarily follow from the other. They’re completely separate
activities. I’m trying to get them to think in terms of the
investment and the industry stimulation. The determination that NASA
has a need or a requirement is a completely separate exercise, and
should be considered by different people in a different process. Yes,
there is active work going on now to find other areas where we can
make these investments.
Wright:
Sounds like there may be a shift in NASA’s culture in a way.
Graham:
I was speaking to a bunch of law students from Georgetown [University,
Washington, DC] the other day, and one of the things that I talked
them about was that NASA isn’t a regulatory organization. We
don’t really make policy for the government, but we implement
policy by the way we spend money. If we decide to spend money through
a contract, that will have ramifications on the industry base, in
the type of IP we get, who owns the work product, what that relationship
looks like. If we choose to spend our money through investing and
development of stimulating industry, that’s going to have different
ramifications.
As we’re looking to implement administration priorities, the
question is how do we spend our money in a way that’s going
to best advance those administration priorities? The administration
we have now is very focused on developing commercial capabilities,
so I think that there’s an alignment there with that continued
use of authority. When GAO sat down and really wanted us to write
some regulations on how to do these agreements, I said, “I’m
really not comfortable with that because I don’t know what a
funded Space Act Agreement will look like in five years.”
I don’t know what our next administration is going to ask us
to accomplish, so we can’t really say what that use of the authority
will look like. That’s one of the reasons why we’ve been
a little bit reticent to say, “Here’s how you do a funded
Space Act Agreement. You do a competition and it looks like this,
and you do this, and you have to have these things, and here’s
what the agreement looks like.” It’s going to be hard
to undo if we want to maintain the flexibility, and why would we constrain
ourselves?
Wright:
Mr. Wholley used the expression “cautious innovation.”
I thought that was an interesting pairing of terms.
Thompson-King:
Yes. One of the things that I’ve been teasing Courtney about,
saying how many people don’t listen, but they’ll listen
to this years later. On the contract side of the house, we have a
concept known as non-competitive awards. We haven’t gotten to
that concept in awarding Space Act Agreements. We’ve been focused
on competition. We have been focused on fairness.
In 5 years, 10 years, we may be at a place where we are comfortable
making awards on a non-competitive basis. I don’t know how we
get there, but that may be something that we look at, that we will
be pushed to look at. The guidance that we’re going to have
to issue may have to anticipate that. Because I’ve gotten questions
from different folks, and as we go along, that may be something that
we have to grapple with on the Space Act Agreement side of the house.
Reilley:
That may very well be driven by whatever the purpose and nature and
working relationship of that next type of funded Space Act Agreement
is. When Courtney was talking about the guidance on Space Act Agreements,
and why that’s something of a tentative subject because each
one might be different—we used to have program guidance. It
was called a PIP, a Program Implementation [Plan], about funded Space
Act Agreements.
It was developed for a prior model that we’d had, that you would
use for a more collaborative, advancing the state of industry. Not
really a competitive environment. Companies, a lot of universities,
would submit proposals they wanted to participate, but it was not
quite a come one, come all. It wasn’t exclusionary. It wasn’t
we only have this many dollars, therefore we can only have a few partners.
We had 40 partners. We can have multiple partners.
It had a very different flavor to not only why you were doing it,
but how you were doing it, so the process was quite different. Once
upon a time, we did have guidance there for that kind of activity.
Would that sort of guidance still be appropriate for the type of funded
agreement we did in COTS? In some ways, but in some ways probably
not, because it was set up for a very different type of partnership.
Same thing going forward. Who knows what the purpose of another funded
Space Act might be.
Graham:
I’m just remembering—we had a funded Space Act Agreement
to set up a venture capital fund called Red Planet Capital [Inc.],
and NASA actually provided seed money. I think we started with $10
million and we were going to fund $20 million per year for four or
five years. It was for some investment managers to invest in technologies
that were of interest to the Agency and would advance the aerospace
industry, to stimulate development. That didn’t get political
support, so we were directed to stand it down. But that was a funded
Space Act Agreement to give someone some money for something that
wasn’t even technology development. It was money management
to lead to technology development. I can see that we’re going
to get lots of interesting ideas like that.
Reilley:
A different model—we did one at [NASA] Dryden [Flight Research
Center, Edwards, California]. They did a funded Space Act Agreement
with the Air Force and with several companies, that unmanned aerial
vehicle. That had a different flavor to it as well. You can see why
it would be difficult to have a process, a policy or procedure, when
the nature of these particular activities is very different one from
another.
Graham:
Right, because I was thinking about the JSRA [Joint Sponsored Research
Agreement] to develop one of the X planes. The AGATE [Advanced General
Aviation Transport Experiments] Program was where we provided money
to a nonprofit, that then managed everybody.
Reilley:
There were two. AGATE was the one where we actually had about 40 different
partners not exclusive of each other, we could have lots of partners.
The one we did after that, SATS [Small Aircraft Transportation System],
was the one where we had one nonprofit, and they had partners. That
was yet a different model of how we went about considering who we
would partner with and how we would go about doing that.
As Sumara said, we have always had some element of a competitive process.
That process has varied depending on how we were working with our
partners. The extent to which we will have that, or will consider
that, depends on whatever the next project is.
Hackler:
Anything before we close? Are there any last thoughts you want to
put on the record about COTS and Space Act Agreements?
Graham:
No, I think you guys did a good job of keeping us on track.
Wright:
Well, thank you.
Hackler:
Thank you very much for your time this morning.
[End of interview]
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