privilege to be entrusted with, and i look forward to your questions. >> great. thank you mr. bruno. mr. meyerson, you're recognized for five minutes. >> chairman rogers, ranking member cooper and members of the subcommittee, thank you for the opportunity to speak before you today. assured access to space is a national priority and a challenge that we must meet domestically. blue origin is working to deliver the american engine to maintain u.s. leadership in space and deliver critical national security capabilities. our partnership with ula is fully funded and offers the fastest path to a domestic alternative to the russian rd-180 without requiring taxpayer dollars. for more than a decade can, we have steadily advanced our capabilities flying five different rocket vehicles and developing multiple liquid rocket engines. we're spending our own money rather than taxpayer funds, and we are taking a clean sheet approach to development. as a result, we're able to outcompete the russians,

building modern american engines to serve multiple launch vehicles. our recent successes demonstrate that. in april of this year our be-3 engine performed flawlessly, powering our new shepherd space vehicle to the edge of space. the be-3 is the first new american hydrogen engine to fly to space in more than a decade. united launch alliance recognized the merits of our approach when they selected our be-4 for their vulcan rocket, improving performance at a lower cost and is more than three years into development. most importantly, it is on schedule to be qualified in 2017 and ready for first flight on the vulcan in 2019. two years ahead of any alternative. being available two years earlier means that there's two years' less reliance on the russians. as with any ox-rich, stage development, there are technical challenges. blue made conscious design choices to mitigate risk and we

also have an extensive testing program underway completing more than 60 stage combustion tests on our power pack to date. full be-4 engine test ising is on schedule to be completed or being conducted by the end of next year, and because we own our own test facilities, we can do this much faster. blue is well capitalized and significant private investment has been made in the facilities equipment and personnel needed to make the be-4 a success. the engine is fully funded primarily by blue with support from ula and does not require government funding to be successful. instead of duplicating private earths, the u.s. government should focus its resources on developing the next generation of launch vehicles to meet national security requirements. and in conclusion, no new engine can simply be dropped into an existing launch vehicle. launch vehicles have to be designed around their engines and launch vehicle providers are

the ones who are best able to decide what type of engine they need. thank you, and i look forward to your questions. >> thank you mr. meyer soften. ms. van kleeck, you are recognized for five minutes. >> chairman rogers, ranking member cooper and members of the subcommittee, it's a privilege to be here today to discuss this important national security issue. simply stated, we have an engine problem on the atlas v rocket, the nation's best national security launch vehicle. it uses a russian-made rd-180 booster engine. i want to thank this committee for recognizing the problem and taking action. it continues to be our position that the fastest least risky and lowest cost way to fix this problem is to develop an advance ised american rocket booster engine. based on a robust public/private partnership, we firmly believe

this can be accomplished by 2019. in fiscal years 2015 and '16, this committee took a leadership role by authorizing funding and direction for the air force to competitively develop this engine by 2019. airjet welcomes the opportunity to compete for this effort, for an engine we call the ar-1. unfortunately, more than six months have passed since fiscal year 2015 funds were authorized and appropriated for the engine development program that this committee man a kateed, and virtually no man has been spent. it appears this engine development is being subsumed into a lengthy new launch vehicle development and subsequent launch service acquisition. mr. chairman earlier this week you stated in the press, and i quote: it is not time to fund new launch vehicles or new infrastructure, rely on proven technologies. it is time for the pentagon to harness the power of the american industrial base and move with purpose and clarity in order to swiftly develop an american rocket propulsion system that ends our reliance on

russia as soon as possible. end quote. you're exactly right and we wholeheartedly agree with you. this is a national security imperative and should be treated as such is. we have the technology to fix this problem but we must get moving. with the focus public/private partnership at airjet, we have the capability to manufacture the engine and be a more drop-in replacement on the existing atlas v. airjet is able to say this with confidence based on more than 60 years of experience developing and producing launch vehicle propulsion. we have at hand these technologies as we've worked on them for the last 20 years. we have active, state of the art liquid rocket engine factories that are currently delivering engines supporting upcoming national security launches. we're the only domestic companies designed to develop engines with greater than 150

pounds thrust. replacing the rd-180 requires nearly a million pounds of thrust. we've experienced short timelines such as our nation now faces. the first stage engine on the delta iv launch vehicle which produces 700,000 pounds of thrust was developed and produced on a five-year schedule. ar-1 will not be a copy of the rd-180 it will be a superior all-american engine and will leapfrog russian technology. ar-1 will be able to any u.s. launch booster propulsion user and con fig rabble to any vehicle. the intellectual property will be retained by government. to reiterate our nation has an engine problem on its premier launch vehicle the atlas v. we must get rid of the russian rocket engine. we believe the fastest, least risky, lowest cost manner to do this is to develop an advanced american engine to replace the

rd-180 on atlas v. this can only be done by 2019 with a focused and robust engine development program and a public/private partnership. doing so will preserve action to space and reinvigorate the industrial base. chairman rogers, i want to thank you again for holding this important hearing. these are difficult issues, and each of us at the table has competing equities at stake. on behalf of airjet, i appreciate you allowing our voice to be a part of this conversation. i look forward to your questions. >> thank you ms. van kleeck. mr. culbertson, you're recognized for five minutes. >> good morning. thank you for the opportunity to appear today. i have submitted my full statement for the record, of course, and in the interest of time i'll briefly describe how orbital a atk is working. as a global leader in aerospace, otter bittal atk delivered

aviation-related systems to support our nation's war fighters as well as civil government and commercial customers in the u.s. and abroad. our company is the leading provider of small and medium class space launch vehicles for civil military and commercial missions, having conducted more than 80 launches of such vehicles for nasa, the u.s. air force, the missile defense agency and other commercial customers in the last 25 years including delivering approximately four tons of cargo to the national space station. as the committee is ware, earlier this year the u.s. air force announced its phase ii development and launch services acquisition plan. one of key components of this plan beginning in fiscal year 2015 centers on the rocket propulsion or rps prototype program. we believe the air force's acquisition plan for rps is well conceived, and if supported by congress, will be successful in providing new space launch capabilities that are

affordable, reliable and available by the end of this decade. as both a builder and supplier orbital atk is prepared to support the prototype program. orbital atk has proposed both solid and liquid propulsion system developments that will support a new all-american launch vehicle family as well as civil government, commercial international launch needs. it is true that we are currently using a russian engine on one of our launch systems, and that's because it was the only one available to us at the time. we had to meet our commitment to the international space station and deliver can cargo. our new systems, however, will be develop inside a public/private partnership with significant private investment and ask we are confident that our alternatives will be ready to support if first flights by early 2019. orbital atk is committed to assuring access to space policy. reliable affordable and capable

space launch systems are critical to insuring our country is prepared to maintain access to space. through the program outlined by the air force, we believe that u.s. industry is able and poised to respond to this need and will provide the best possible combination of systems to future access of space. we appreciate the efforts of this committee and this congress to correct the situation we find ourselves in propulsion development in this country. thank you, mr. chairman. i look forward to your questions. >> mr. chairman, ranking member cooper members of the subcommittee, thank you for the opportunity to appear before this committee. in addition to my opening statement, i have prepared a detailed written statement which i have submitted for the record. mr. chairman, this country's ability to launch rockets without using russian engines should not be in question. america right now has talented rocket scientists, engineering and technicians currently flying or developing innovative american-made solutions to end u.s. relicense on russia today. it bears noting that there has

been a concerted movement towards national consolidation of the russian space industry and a series of recent failures with russian rockets engines and spacecraft. having worked for both government and private industry including the air force and nasa's marshall space slight center, i can el -- tell you more is happening now in proto pulse in the united states than at any time in my career. spacex today is the largest private producer of liquid-fueled rocket engines in the world. it's flown more than any other domestic rocket flying. in the past 13 years spacex has developed nine different rocket engines. merlin is the first new american hydrocarbon rocket engine to be successfully developed and flown in the past 40 years all while offering the highest thrust to weight ratio ever achieveed. we are investing in a next generation rocket engine could raptor which will be a

fundamental advancement in propulsion technology and serve a number of applications for the national security space market. and we have captured more than 50% of the global space launch market unilaterally increasing u.s. market share from 0% in 2012. with respect to a national engine program, the air force is undertaking a strategy to result in not just a rocket engine, but in launchsystems. we believe this approach will, if done correctly benefit the entire u.s. industrial base, properly require private industry co-investment. most importantly the air force is seeking to insure that any new system is commercially viable in order to end the current practice of costly and unsustainable government subsidization. spacex stands ready and able to provide access to space for the united states with our launch systems today as well as next generation propulsion launch systems. in may the air force certified the falcon ix launch system to launch the most critical

national security payloads. we appreciate the air force's confidence. powered by the merlin rocket engine the falcon ix can perform 60% of the dod launch requirements today. we are also using the merlin rocket engine between these two launch vehicle systems. spacex will be able to execute 100% of the dod launch requirements and provide heavy lift redundancy for the first time to the government. we anticipate falcon having certification in mid 2017. at the same time, spacex is developing raptor. this stage combustion reusable system will be versatile efficient and reliable while achieving commercial viability through notable risk and cost-reconstitution immaterial prudentes. raptor will advance the state of the art insure the u.s. remains the global leader in rocket propulsion technology and serve important applications for national security space launch. importantly, meaningful competition is reentering the eelv program. with this we have seep the

incumbent make promises to reduce can its costs innovate and fund new development efforts with private capital, and these are good things. much has been made of a so-called impending capability gap and assured access to space. the only gap that currently exists related to heavy lift capability. this is because the russian-powered atlas v does not have a heavy lift variant. otherwise there is no credible risk of any capability gap for national security launch now or in the future. existing vehicles including the falcon ix and the delta iv are both made in america, certified for dod launch. the atlas will continue to flew through 2020 -- to fly through 2020 under current law. soon however we'll close the pre-existing gap through internal funding by spacex. falcon heavy will be certified before any national program is set to fly. i want to close my testimony with some constructive solutions to truly achieve assured access.

first, the united states doesn't need more russian engines to get national security space payloads to orbit. second continue working to achieve assured access through genuine competition between multiple providers with redun adapt can k truly dissimilar launch systems. congress must structure its industry development effort to maximize smart environment. any government money should be matched by private capital to insure meaningful co-investment and commercial viability must be a key component of the future system. mr. chairman, thank you. spacex, with our u.s.-built falcon ix and falcon heavy as well as our investments in raptor, looks forward to contributing to the nation's space enterprise. i am pleased to address any questions you may have. >> great. great job. thank you all of you. my first question was going to be to the companies, do you

think you're capable of providing us a rocket propulsion system advanced rocket propulling system by 2019 mr. meyerson and ms. van kleeck answered that in their opening statement. mr. culbertson, you implied y'all were going to get into combination for this replacement engine. was that an accurate interpretation of your opening statement? >> yes, sir. we certainly are working towards that end. >> excellent. mr. thornburg, are you all planning on get anything that competition for replacement engine? for the rd-180? and you have it done by 2019? >> through our existing launch vehicles, we can provide 100% of the nation's needs for national security space missions. in addition, we'll continue our investment in next generation propulsion systems and capability to further increase the u.s.' position in propulsion development. >> my understanding is you're talking about you can use your

falcon ix 1.1 and falcon heavy when it's certified to compete for this mission but you're not planning to get in the competition to develop a propulsion system to fit on the atlas v? >> we're investing internally in next generation systems like raptor and we're happy to have the conversation about how we can support the u.s. government. and anytime the congress and u.s. government asks what can industry provide to service the needs of the country, we're ready to participate in that conversation. >> i heard you make reference to both the merlin and the raptor. if those, in fact would work in some way with a launch system, would you be willing to sell those to other u.s. companies? launch companies? >> from an engineering standpoint yes. that's something we would entertain at -- >> i'm sorry mr. culbert soften you want to be recognized? >> yes, sir. we're not proposing a replacement engine for atlas we're proposing a launch system

that would meet the needs of the country. >> okay. >> in response to the air force. >> that's, that's what i -- you had me excited for a minute there. i want a new engine. i don't want a new rocket. we want something to replace the rd-180 and if not be a drop-in fit on the atlas v something that doesn't require a whole lot of modifications to work on the atlas v. i understand all of y'all like what you've got and i know mr. bruno wants a new rocket. that's awesome. as long as we're not paying for it. we want an engine to be able to get our critical missions into space in a timely fashion. and 2019, as you know is a critical time for us. well, let me ask -- now go back to the two people i know are going to compete for it, mr. meyerson and ms. van kleeck. will the cost -- and start with mr. meyerson. will the cost of your engine be comparable to what we are currently paying for the rd-180?

>> according to our customer at ula, we understand it is. it's comparable or better. >> ms. van kleeck? >> yes sir. we've designed the ar-1 to be at or below the price point of the rd-180. >> okay. i want to stay with you, ms. van kleeck, for a minute. mr. mr. bruno in his opening statement made reference to the fact that you were 16 months behind blue origin in the development of your engine. can you address that observation? what did he mean by that? >> well, i don't have my competitor's schedule, so i can't say for certain where the 16 months comes from. what i can say is we will be certified by 2019. we're very confident about that. we've spent 20 years developing this technology from the russians that was pioneered by the russians. we have the factories, we have a schedule. we will be testing full scale engines in the end of 2017. and we will complete certification in 2019 -- >> 2018 or 2019?

>> we'll complete certification of the engine in 2019. >> mr. meyerson, do you believe -- tell us what your schedule is. when do you think you will complete certification? >> we belief the engine will be qualified and certified for flight on the vulcan in 2019 with certification coming after. we've been working at this for more than three years and we have the facilities and people and processes and equipment in place to do so. so we have high confidence in our schedule. we're testing hardware now we're testing today. so the confidence, the level of data is well ahead of any alternative. so that's what gives us the confidence in our schedule. >> you made reference to the vulcan in your opening statement, and i know mr. bruno really wants to have a vulcan launch system. >> yes. >> we're interested in the atlas, or i am in my questioning. will your engine work on the atlas with modifications and how significant of modifications

would it take? >> so our engine runs in liquid oxygen and liquefied natural gas. so, no as the atlas is designed, it will not integrate with the atlas. >> so we would have to have a new launch system. >> that is right. >> okay. mr. bruno, tell me -- let's talk about this vulcan system. tell me where that came from and when you see that happening and how does that play into what we're doing right now given you know our previous testimony and my comments publicly and our conversations privately. i feel very strongly, i just want a replacement for the rd-180. why are we talking about the vulcan? >> certainly. well vulcan really refers to a series of evolutions to the atlas that takes several years to accomplish. the first step in that evolution is simply replacing the engine that is on the atlas. so whether it's an ar-1 or a be-4 that atlas would be called vulcan, and it would still have

the atlas strap ons. it's essentially an atlas with a new engine. and if i might take a moment -- >> certainly. >> i would like to expand on my colleagues' answers. i think they were far too modest when they responded relative to the cost of their engines. so first understanding that there is no such thing as an rd-180 drop-in replacement, we are not capable of replicating the performance and thrust level of the rd-180. what they are talking about is providing a pair of engines that would replace the single rd-180. that pair of engines we expect to be upwards of 35% less expensive than a single rd-180. so while the performance of the engine is only first generation and lagging what the rd-180 has the manufacturing technology is a giant leap ahead. >> okay. i'll get back to you on my next round, but i want to turn to the

ranking member from tennessee for any questions he may have. >> thank you. i appreciate the expertise on this panel and i appreciate my friendship with the chairman. i'm a little worried we're pursuing a unicorn here because i think mr. bruno just said there is no drop-in equivalent. and we're kind of fooling ourselves if we think there could be, at least in the reasonable future. now, there are some, you know, work-arounds replacements, and there's certainly new launch systems. so continuing the theme of my opening statement, i think our first role should be, first do no harm. because we wouldn't even be here if we'd gottennen the language -- gotten the language right in last year's ndaa. so i'm not a technical expert i'm certainly not a rocket scientist, but it seems to be in this testimony there's some remarkable differences first of all, i regret, it's a little bit unfair. the witnesses are at least 3 to

1 against spacex, and i'm not sure that's fair. perhaps we should have given mr. thornburg three times the time and maybe three and a half to one against but he more than held his own and it should be exciting for all americans that we have billionaires and entrepreneurs who are willing to devote so much of their resources to coming up with new and, apparently, more efficient solutions. but factual question, is there a gap, you know? et seems to me that we need at least nine rd-180s. we may need 29. we may need more than 29. and meanwhile, a lot of what you hear on the hill is a lot of bad mouthing the russians, and there's plenty of reasons to bad mouth at least their leaders. but while we're dependent on the rd-180, it may not be the smartest thing strategically to bad mouth the source. now, hopefully, we can overcome this gap and mr. thornburg's testimony is that the real gap

is the premature decision to retire the delta medium. so there you don't blame the russians, you blame us. or the gap could be air force dragging their feet to certify the new falcon heavy and certainly, there are a lot of worthy and important requirements in certification three required successful launches lots of things. i loved mr. culbertson's quote where he said we can lick gravity, but sometimes the paperwork is overwhelming. what congress is really good at is paperwork and putting in artificial requirements that often times impede the private sector's ability to innovate. i get word that when -- worried that when it comes to my beloved impala, to finding a new v8 to put in the vehicle.

i want a car that will work not just an engine that will perform. and when we talk about insured access to space we want a vehicle that can get our payloads up into the appropriate orbit. it may be we haven't had enough discussion in this panel of appropriate orbits, and maybe we can't do that in an open setting, but we have to serve all of our national security needs. and some of those are harder to achieve than others. so i hope that this hearing, and it may take the second panel to do it, will be able to resolve the question of whether there's a gap and if so, how large and how west -- how best to bridge that gap. and to a surgeon exfelt, all of -- certain extempt all of the witnesses are asking us to buy some vapor ware because nobody has a crystal bar. one tends to believe mr. bruno when he says it ain't gonna happen because it takes time, at least the american way of doing it. i hope it's not that long.

but -- and we should all be encouraged to stay with the new methane engine, you know, the blue origin is completely amazing. but also the idea of the raptor is totally amazing. but some existing accomplishments are things we should be dopily proud of. i'm a little -- should be deeply proud of. the falcon uses nine or ten engines, and you claim an engine heritage that is able to be multiplied due to the number of engenerals. it makes me think if the falcon ix were composed of a hundred engines, then you'd have a track record a hundred times more successful than rd-180s. perhaps that's a specious ideology, but still you can't deny the accomplishments because you've exceeded what most people would have expected. but, again our job here is to not stand in the way of progress. and i think the statement of the

administration policy was pretty on point when it said soften the congressional language, especially last year section 1608 gets in the way. so how do we eau resolve this in a sensible way? we want commercial competition, we want a shared access to space. but above all, we have to have assured access space. so i'm hopeful that the witnesses can help us resolve these questions. and as i say, it may take this second panel. but there seems to be general consensus that no one is talking about a drop in engine. because it's my understanding that even the proposed solutions are either 18 inches too long or 4 inches too long, or there are really two engines instead of one engine. so the chairman's goal, as worthy as it may be, is really not available from any of the witnesses on this panel. the chairman's goal of cost savings is extremely important but i don't need to remind members of the armed services committee how much money we're

wasting on various things here or there. and in the scheme of things, the money we're talking about here is relatively small and manageable. so if any of the witnesses want to correct my impressions i've spent much of last night reading your testimony. it was very helpful. but it also is so conflicting it's hard to find where the truth lies. so ms. van kleeck, you seem poised. >> yes. yes, sir, thank you for the opportunity. the rockets have been re-engined in the past, okay? numerous occasions both in this country and in the others. you can replace rocket engines. the ar-1 is a near drop-in replacement -- >> [inaudible] >> yes. and i'll explain the differences, and they are minor. there's -- we can reproduce an rd-180 in this country. it would cost, in my opinion more money than it would to develop a new engine.

it's a very complex engine, and it would also cost a lot from a recurring standpoint. and i think it's time for the u.s. to leapfrog that technology anyway. the ar-1 uses the same propellant, it has the same engine cycle so it'll have a very similar environment, it would use the same tankage have the same attach points, has the same performance -- not lower performance, the same performance -- it is two engines. we did look at making it a single engine, but two engines is probably a better long-term solution for the u.s., because it can be used in multiple other applications in the future. and you can have the exact same physical attach points with the two-engine solution. it's really where the propellant feeds the engines and how out attaches. it is 11 inches longer, but we've been told by ula engineers that the length is not an issue. there is length to work with. that will affect minor ground support equipment, but it's very miles per hour. we're talking modest -- minor. we're talking things we've done in the past.

so it's as near a drop-in replacement as can be made. >> but there are many other issues, acoustics, you know, and mr. bruno was saying just because you started late, you're 16 months behind. so is we don't know what they will choose in the down select, you know a year or two from now. >> yes sir that's a fact. the acoustics every rocket engine has a specific signature. the fact that it's the same cycle runs at a very similar operating point. we would anticipate that would be similar. >> but there have been lots of anticipations that didn't necessarily pan out. and for assured access to space we need something that will work. >> yes sir. but we have been a part of re-engining numerous launch vehicles over time, and we have beening successful with those. this engine has been designed from the beginning to be a replacement to atlas v, because we saw this problem coming ten years ago. and we have focused on that, we understand the atlas v very well. this engine was designed to interface with the atlas v.

>> well, you may have seen the problem ten years ago, but you're 16 months behind right now even blue origin and some of these other things. so what -- that puts us in a tough spot. we have to measure the gap and figure out how to fill the gap. >> you know, whether we're -- again, we can meet 2019. whether we're 16 months behind or not we would -- one would have to look at the details of these schedules and the different milestones to really come to that. i have not seen. >> mr. chairman, my time has expired. >> thank you, mr. chairman. one of the concerns i have is when you consider the house's position and the senate's position on rd-180s our positions are different. and i've heard that ula is interested in developing the vulcan to the extent that they have a certain number of

rd-180s available for the future, and if we don't have that certain number, then they're not interested in developing the vulcan. my question for you, mr. bruno, is what happens if the senate doesn't come the direction of the house? in that case, what happens to the vulcan and what's your backup plan? >> so either engine path that has just been discussed requires senate investment on the part of ula. without the continued revenue generation of the atlas, until that new american engine is available, we will lack the funds to be able to accomplish that activity. without that, we are entering into a marketplace where the air force market has declineed and is incapable of supporting two providers. now, the good news is the overall lift market is large enough to support both of us, both the new entrant and us and

the ore traditional -- other traditional suppliers. in order to be an entity in that environment, we need to be able to effectively compete for civil and commercial missions in addition to competing for national security space missions. without that lower cost rocket and without the investment required to get there we're simply not economically viable in that window. >> you indicated that with the commercial launches in addition to the military launches, that there would be economic viability for multiple providers, and it looks like even, you know, we might get a third provider with the orbital atk potentially participating. that being the case is there a reason ula couldn't get private capital to support the investment? >> it's up likely that the capital -- unlikely that the capital markets would look at this uncertain investment environment any more favorably than our parents do.

so investment really dislikes and avoids uncertainty. and as we sit here today, it's very uncertain whether the atlas will even be available to fly during the period between the end of its current contracts and the availability of the new rocket engine. so that leaves a multiyear period of time when we have no product to bring to the marketplace. not very lakely i could attract -- likely i could attract money from capital markets for that. >> mr. culbertson, does orbital atk greet with that position that it's not worth the investment? if there's not more rd-180 engines, obviously you guys are doing it without the rd-180. >> i can't really comment on ula's position on this. we do see a market out there but it's still pretty slim in the classes we're discussing here. we actually are working with ula to continue to supply cargo to the international space station. after we had the accident, they, spacex and a couple of other companies stepped forward and

said we can give you a ride and we have contracted with them on a commercial basis to do that. so we are sort of the beginning of their commercial market to continue to fly. but we also are continuing to develop our own systems to fly not only to the space station but to fly national security missions. >> mr. thornburg when you think about the commercial market with the eelv program, is there -- is the market big enough, and for how many providers? and, clearly you guys are already making the investment privately. >> i would also say that, you know, as an engineer i'm not necessarily studying the market markets, but i can say spacex believes we can be very competitive across the market. as i mentioned in my opening statement, we've recaptured for the united states 50% of the launch market share. so certainly, with more cost

effective launch solutions, the market does open up. >> and for mr. bruno, you would know that the united states and we as members of congress, we want to make sure we have assured access to space which means we need multiple launch service providers for the eelv program. that being the case, you know, your investors have got to understand that it is the not in our interest as a nation to have two provide isers and one of them go out of business and end up with a monopoly. which means there's going to be some level of security, would you agree with that? and are your investors your parents aware of that? >> the only data i have to operate on at the moment is the forecast that the government has provided for the space lift that occurs in that window of time. and it's important to remember that we're the ride for national security assets. they're recapitalized in waves. so we are currently recapitalizing a set of national security satellites that are well past their design life. that's going to complete in a short number of years.

there'll be a long trough until the new assets run out of life and then they'll be recapitalized. so it's very cyclic. what has been forecast to us by the government -- and it's a pretty sound forecast because we can see the satellites in the pipeline being designed and built -- is that marketplace drops from about 8-10 a year to 5, and that will be divided between at least two providers so two or three and that's not a sustainable economic model if you do not also have access to civil and commercial markets. >> okay. mr. chairman, i yield back. >> thank you very much. the chair now recognizes the gentleman from colorado mr. cough match for five minutes telephone coffman, for five minutes. >> thank you, mr. chairman. first, mr. bruno, congratulations for an outstanding record of success. jeff bezos founder of blue origin and amazon said quote:

ula has put a satellite into orbit almost every month for the past eight years. they are the most reliable launch provider in history and their record of success is astonishing, unquote. i'm proud of, that ula is headquartered in colorado. i'm fully confident ula will remain very competitive in the future. you enjoy an exclusive contract because of your competence, but i want to ask you what exactly can congress do to insure that across the board we have created an environment that promotes innovation while not unfairly tipping the playing field towards or away from any potential provider? >> certainly. but first, i have to on observe that that comment relegals that mr. bezos -- reveals that mr. bezos is obviously a very intelligent man. [laughter] so in order to have a fair and even competitive playing field that is healthy and in the

interest of the government and good for industry, it's important, of course, that the participants in that competition are able the bring competitive products to the marketplace. that's why we need continued access to atlas. in addition to that, the competition itself needs to be fair and even. so we must be held to the same technical standards in terms of the performance and the missions that we're able to fly as well as the contracting requirements. so today the ula is required to perform to what's called far part 15 which are a set of very complex and sophisticated acquisition regulations. they require for us to provide elaborate, extensive and expensive financial recording tracking and reporting systems. our competitor in a commercial marketplace does not. and so all of these elements have to be leveled. and then i would also advise the

government that for national security missions for which our nation's safety depends and warfighters' lives are at risk, that a low price technical acceptable type of price shootout is not an appropriate methodology. you wouldn't buy your car that way, you wouldn't buy your home that way, and our soldiers' lives should not be dependent upon it. so when competing and when making selection ises, they should consider cost equally balanced with technical performance, reliability and schedule certainty. remember i mentioned that the assets being recapitalized are generally beyond their design life. there is an urgency to replacing them as soon as possible. that too, should be considered. >> thank you. mr. thornburg, congratulations on successful certification of the falcon ix. in march mrs. shotwell testified in this committee that you have

dcaa auditors doing -- manufacturing audits right now and your cost and your rates have been audited. was that testimony correct? and you briefly describe the frequency and extempt of the dcaa -- extent of the dcaa audits that spacex undergoes and the number of dcaa personnel residented at spacex facilities? >> to your first question, was her testimony correct, i believe, yes the answer to that is yes. with regards to the questions about dcaa audit and frequency and my position within engineering and working engine and vehicle development, i'm not familiar with the frequency of the visits. i can tell you that we're working very closely with the air force and the dod. i'd be happy to go collect that information, return it for the record. >> yeah. i'd really appreciate it if you could get that back to us for

the record. mr. chairman, i yield back. >> i thank the gentleman. chair now recognizes the gentleman from colorado, mr. lamborn, for five minutes. >> thank you, mr. chairman for having this very important hearing, and thank you for the timeliness of this hearing. mr. thornburg, i'd like to ask you about the current version of the merlin engine that you're using. is the new baseline, is the full thrust merlin engine the new baseline for the falcon version 1.1 going forward and does space x intend to bid that system for upcoming eelv launches? >> the current engine we're flying is the merlin 1d boost engine. your reference to the full thrust is a minor upgrade to that engine. basically, it takes the full potential of that engine system for future missions and then falcon ix 1.1.

>> now, what are the differences between the two systems both hardware and software? i've heard that there are hundreds of differences. is that correct? >> i can't, i can't recall the exact number of differences. i can say that from a technical standpoint engineering wise, the differences are very minor. in terms of the changes and the upgrades to the engine. it's all in line with our continual improvement over propulsion systems and over all vehicle systems. but we're taking the existing merlin 1d with its presence design and performance and taking the additional performance that we have available there and offering it to our customers and to enhance the performance of the falcon ix 1.1 system. >> but i'm -- what i'm trying to get at is with the changes that you incorporated, does the previous certification cover the

new what amounts to what i would consider a new version once you've started making a lot of changes? >> as far as the sortification earth to date recent certification, the merlin 1d engine and going forward the bulk of that is identical. so we're talking about minor changes and upgrades to the system that'll be reviewed through ongoing and future engineering review board activity with the air force. >> so even though there are an undetermined number of changes indeterminate number of changes you can't give a number. you don't think that that amounts to anything worth recertifying? >> no. >> or reopening the -- >> no. the ongoing dialogue with the air force through the certification process has been

fantastic. we're working very closely with the air force as well as the aerospace corporation. the type of improvements and modifications that the falcon ix launch vehicle is going through is no different than atlas and delta have taken to oven over the years, so we're in line with that in terms of certification and ongoing certification activities as these improvements come online. >> i just wish there was a little more certainty in this, because you can't even tell me how many changes there are. i guess that's a concern. i think we should get to the bottom of it. changing gears here, ms. van kleeck, what advanced technology does the rd-180 use and why is it important that we bring that technology to the u.s.? >> well, the rd-180 is what's called an oxford stage combustion cycle engine, the

most efficient engines that can be -- chemical rockets that can be produced. the russians pioneered and perfected the oxford stage combustion engine during the cold war and the u.s. didn't. the u.s. perfected solids and hydrogen systems. so it's a very high performing hydrocarbon engine. it provided a lot of advantage to the original atlas vehicle. some of the things that are in it are advanced codings, advanced materials. it's very compact very high pressure. those are things particularly the materials were things that this country did not choose to pursue and didn't develop. and so that is where -- there is a technology gap in this particular variant of rocket engines in this country. >> and mr. meyerson is, would you agree with that assessment? >> in terms of the rd-180 and

the importance and the efficiency of the cycle yes i agree. i think, you know, if you look back to the time that lock he'd martin -- lockheed martin ula's parent was an enabler for the atlas v. today i think it's time to take a fresh look and look at a new engine. the ox toford stage combustion cycle is critical, and that's what blue origin has chosen for the be-4, but the be-4 is the enabler for the next generation of launch vehicles, and it's the choice of liquified natural gas as a propellant is one of those enablers. >> okay, thank you. thank you all for being here. >> i thank the gentleman. let's start our second round of questions. e -- can i was listening to my buddy from temperature when he was talking about his chevy -- from tennessee when he was talking about his chevy and dropping a new engine in. i've made it very clear, my

priority is to re-engine the atlas v. and as he was talking he and i had the true privilege to meet with an american treasure earlier this week, retired general tom stafford, also an apollo astronaut. and we both visited this topic with him, you know? how big a deal is this, to re-engine this rocket? and he basically said, it's nothing. we re-engine fighter jets for generations, and that's much more complicated than what we're talking about here. and so with that backdrop, mr. culbertson, your company's in the process of changing the engine and the entire launch screening to the rd-180 russian engine, is that correct? >> yes, sir. >> concerning your own experience, how reasonable is it to change an engine? >> it depends on the background of the engine and what it was originally designed for and the maturity of it at the time you moved forward with it. the engine we are using in the

future generation of -- [inaudible] launch vehicles was specifically designed as a replacement for the nk-33. so the arrangement of the thrust vector, the piping, if you will, for the fuel systems, the connections, the size of the engine and the thrust levels were all very comparable to the nk-33 because it had been in development for almost ten years now to replace that engine on a couple of different russian rockets. so when we started talking to them over three years ago, they were pretty far along on that path already. we did a lot of analysis to make sure it would, in fact be compatible, and when we reached the point where we needed to move forward with another epogen, it was the -- engine, it was the one that was most likely to succeed in our application and the one that was available to insure that we could continue to deliver cargo. >> great can. ms. van kleeck, you've already

heard some reference to it today in your interchange with the ranking member and in the next panel we're going to hear that it's going to cost a significant amount of money to re-engine the atlas v with the ar-1. can you address where -- and as i understand it, you're going to hear it's going to cost at least $200 million to modify the atlas v with the ar-1. can you address that? >> yes. i can. we've been working closely with ula for several years now on replacing an rd-180 in various forms. like i said, we have looked at this problem over the past ten years. we have an active contract right now identifying the specific changes that need to be made, assuming this goes into an atlas v folk. we're also looking at a vulcan configuration. that configuration requires a different launch vehicle. relative to the atlas, i've summarized the changes that need to be made, and i will submit

those for the record. in terms of the estimate more those costs i've heard a variety of numbers. i've never heard a $200 million number. the number i've heard for the changes associated with an ar-1 going into an atlas v are in the low tens of millions of dollars. i think that still needs to to be refinded but the types of modifications that are required are very miles per hour. >> for the ar-1 to fit on the atlas v. >> yes. >> okay. mr. meyer soften same question. -- meyerson? >> id add to mr. culbertson's comment, his response that the key board was ten years -- keyword was ten years of investment by the russian government to develop a replacement for the nk-33 that's the key point. ten years, and we don't know how much money was invested. the we-4 is being developed, it's fully funded. so this engine is real there's real hardware to see.

it's not a paper engine, so -- >> great. tell me mr. bruno has stated that both the be-4 and the ar-1 would work on the atlas v with modifications. one with more modifications than the other. can you describe the extent to which we'd have to modify the atlas v for your engine to work? >> i think that's a better question for mr. bruno. but the engine, when you're developing a new engeneral you start with requirements -- engine, you start with requirements, and the details really matter. because the be-4 is so far along in its development those details are much more well understood so that mr. bruno's team at ula can meet the right system to meet the national security need. >> mr. bruno i'd love for you to visit this topic. >> this is an excellent sort of example between an engine provider and a launch vehicle service provider.

it will not cost tens of millions of dollars to incorporate any version of an ar-1. recall that we started with an understanding that the performance level coming out of either of these two engines will not match the rd-180, and we will be using a pair of engines to do that. >> let me stop you will. would the combined thrust of the two engines be comparable to the rd-180? >> yes, it will. in fact, it'll be larger than the two. >> okay. >> in addition to that, the rd-180 uses a very novel thrust vector control system to move the nozzle and steer the rocket. that's also a technology that does not exist in the united states. and, by the way one that we do not have an interest in developing. so there will be a new thrust vector control system to go along with that. so when we do all of that with the new performance point that's required and the new thrust levels that would need to be delivered, there will be software changes structures changes, there will be

alterations to the pad to accomplish even the ar-1. the number that was quoted was not unrepublican, but i think -- >> $200 million. i think we're going to hear from the air force later. >> right. >> you do think that's inaccurate? >> i do think that's inaccurate. >> that's for the ar-1. >> that's for the ar-1. i can drive that down if i am willing to leave the tank exactly the same size as on atlas, but if i do that because of the lower efficiency of that engine and its -- for several missions i will be adding one or more solid rocket boosters to the launch vehicle. so the affordability of that system will beless than the atlas today. >> so getting you those modifications may moves you toward the new rocket system you want but is not access for the engine that i'm pursuing. >> it will not lift the same

missionings. missions. so i think you're asking me could i keep the tank size is same, take engine that i'm -- that is made available to me. strap on the the extra strap ons and just deal with the additional cost. i could doha for within the fleet. so remember that the atlas is a fleet of rockets. the least capable of which is equivalent to a falcon. there are much more difficult orbits that we go to. eventually, there's a limit to how many strap-ons i can physically attach to the rocket because of the way the rocket is configured. those most difficult missions would suddenly become out of reach in an atlas in this confession ration without a longer tank to carry more fuel. >> okay. now let's talk about the be-4. >> yes. so the be-4 requires more extensive changes to our infrastructure and to our rocket -- >> so what does the $200 million

figure turn into with the be-4 as the down selected engine? >> it would not be unreasonable to triple or quadruple that number. >> so 600-800 million. >> yes. >> okay. tell me -- let's talk about the other infrastructure involved. when we change -- let's say we do change to a new rocket. and i'm not saying i'm ready to go there but what else is required for the launch that, i mean modifications other than just the rocket? don't you have to change infrastructure that you use for the launch process? >> yes. so, you know, you could think of it in these pieces. there's the rocket, there's the pad, factory, of course with its tooling, and then the equipment that we use actually at the launch site the integrate the rocket with the satellite and roll it out. so those things, you know, are

more dependent upon the physical size and configuration of what changes we have to make to accommodate the engine. so my colleague is correct. there are far fewer changes with the ar-1 because it's the same propellant, so the diameter and length of the rocket will be much more similar, much more of the tooling in the factory can be same. the equipment at the launch pad can be only slightly modified and the pad will have smaller modifications. for the methane engine, the tank will be much larger. i'll have to replace much more tooling in the factory, i'll have to redo what's called the mobile launch platform that moves the rocket to the pad, and then the changes to the pad are more extensive. >> are those costs a part of that triple or quadrupling? >> yes. >> okay. >> yes. >> so that was a comprehensive figure. maybe i mised it, but were you able to explain the difference in the 16 month t of lead that you assert that blue origin has

over airjet and their development? >> yes. so both companies are under contract with us. we have, you know sort of weekly engagements monthly formal program resaws. we're tracking both schedules side by side. as i mentioned in my opening remarks, airjet started several years later than blue origin, and that is essentially the nature of the 16 months. >> okay, thank you. this'll be for all the witnesses. do you agree 245 the government should -- that the government should own the intellectual property of any investment it makes in a new propulsion system? mr. meyerson i know you're talking about your private money, but if we're going to invest money in it, do you believe we should own some of the intellectual property value? >> i think if the government fully invested in the system, they should own the ip, yes.

>> ms. van kleeck? >> yes sir, i do agree. >> mr. culbertson? >> yes sir, if the government has invested the majority of the money, then they should, as the law allows, own the ip for it. but the companies also investing should own the ms they -- the systems they bring. .. the development we were talking about in terms of the technology an offshoot

of something that have been developed and invested by the private corporation but i think it would be case dependent clicks the contracting methods there are mechanisms in place to allow shared ownership quakes that is one of my concerns. we projected stamped in pursuit as much as 800 million or more may be paid for by the federal government. there seems to be some interest that we have any intellectual property business arises out of that. [inaudible conversations] i want to ask the witnesses this and this is for all the witnesses are there clear requirements in the

air force about what they are expecting and if they are fair and reasonable? >> i think the requirements are fair, yes. >> i assume i assume you are referencing the current acquisition process underway quakes yes, ma'am. >> there is an office spelled out in that that focuses on a lump services approach. it is spelled out. there are different paths that particular process can take. quakes we feel like based upon our experience we understand the requirements and do think that it is focused on a system that can be developed in a

public-private partnership that will give the government the most options for competition as well as success. >> ma'am. >> i do not think it is appropriate for me to comment on right now due to the ongoing source selection >> any comment on this? >> i believe the requirements in the rps you are referring to are very clear and reasonable. >> great. a couple of cleanup questions. your history as partnering with law service providers are being a law service prime why do you believe that this approach is not appropriate in this situation? >> -- >> i think the issue at hand

is replacing the engine and engine, and right now we're looking at an acquisition process, process, you're looking at an evolution of the service. i believe that acquisition, you can get to an engine through that process but it is not the most efficient way to do so. >> finally, as we move forward can you tell the committee if you intend to mitigate risk by carrying the ar one and it be. >> design options? if not why not? if yes when will you be able to oscillate? >> i will not carry them all the way to completion. we will carry both until it is clear the major technical risk has been retired and we are able to downgrade. i expect that to happen the end of 2016.

the reason we will down select and not carry both forward is simply because i cannot afford to carry both all the way. >> thank you very much. >> thank you, you mr. chairman. there are five areas i would like to pursue. it will it will be important for this committee to understand. and the air force rps that prediction of payload size. the assumption is that they will get -- stay about the same size they are today. on the big side. maybe maybe we do not need the lift capability. all of this talk about lift capacity the question is what are we lifting. as electronics get smaller and smaller it could be that ledger lift capacity is

sufficient to do the job. job. i don't know the answer to that question. does anyone on this panel have an answer? >> the standard reference remains what the air force calls the age of reference mission. they provide us with a set of orbits and payload weight to be lifted to that orbit. those have not changed as of this date. the most challenging require our complete capability all the way to the atlas five with the strap ons and largest payload. >> part of it is orbit, weight -- >> yes, and it is important to understand the subtlety within that as well which is the time required in space to reach the highest orbit. and that dictates some of the technical characteristics to characteristics of the upper stage. geosynchronous orbit if you

wish to directly inject it takes eight hours flying in space operating in upper stage to circular eyes that orbit something not possible with conventional fuels like kerosene, for example without elaborate systems to keep it from freezing up. >> we have not given much attention to the second stage problems that you.out. on the intellectual property issue, the greatest source of wealth on the planet that we have increasing difficulty understanding ownership and relationships like that. it gives us some comfort that an american citizen might be owning ios ip. they might move and make a private sale decision that could endanger national security. this is this is something we need to figure out better in terms of the taxpayers. if we if we could get one or

two pharmaceutical companies to pay back benefits from basic research done at nih every turn many -- it would return many more than a few billion dollars. perhaps perhaps we can work with colleagues and other committees on that. on the question of paperwork you mentioned a requirement that you must endure that others might not i am not sure is that necessary paperwork? can we streamline that in order to reduce the burden for anyone who might have to be subjected to all of that paperwork burden? it is not the ten commandments, not written in stone. >> the federal acquisition regulation provide for different models. fifteen 15 is one set. there is another set referred to as 12 and there are another set that do exactly that and provide

guidance when it is appropriate. >> there is flexibility. is that the biggest and scariest monster? >> yes. [laughter] >> you just mentioned that to scare us. a a question that was mentioned, monopoly, no one likes monopoly. in a best case situation we have a duopoly. we need to find another billionaire. where is richard branson. [laughter] or maybe there are others with sufficient egos. you correctly said the business case is not exciting, number of payloads , substantial risk it takes an investor with ego to compel the speculative investment from the glory of space. as we fear a monopoly we should bear in mind the best case is not a lot better.

we love the retail model where we can get amazon pricing for everything but that is not likely to be available for everything. so you do so you do not want to be too idealistic in this a touchy issue of recruiting brilliant personnel. we relied heavily upon folks important from germany. the last one down in huntsville, alabama. unquestionable -- unquestionably there are civilian scientists who make a difference. recruited a lot of folks from a lot of places. >> that is interesting and makes me think our failures

how that worked. that person. maybe the chinese did that when they integrated it or maybe they just stole blueprints. but you kind of wonder and hope the team of scientists can do great things and in many cases they have. there are brilliant individuals who come up with a secret sauce which leads us to the very interesting feature of not relying upon the patent system to protect their ip preferring instead to trade secret systems which is basically thumbing their nose at the entire western system of protecting intellectual property and i am not defending but it is an interesting challenge here. keep it locked up in a safe as opposed to publishing and

disseminating and protecting there are many challenges that we face to make sure we have assured access and a unique national security capability with whatever is required to serve the war fighter and yet we increasingly rely upon models that may or may not service this unique national capability. these are some of the challenges that the subcommittee faces. we we try to come up with some sort of solution that above all puts america first that is how i see it. if you publicly or privately have amendments i appreciate hearing because we're trying to do the right thing and not let congress mess up yet again like we did last year. thank you, mr. chairman.

>> i would note when congress messed up last year we did not mess up that language. additional questions that he may have. >> you mentioned earlier you la will need to compete in the commercial sector. >> correct. >> does blue origin tends to compete in the commercial space launch industry with its own system and the long-term? >> yes, we do. our new shepherd vehicle and our focus on rocket engines. other parties. if they enter the space and are competing directly

against the commercial market and are entirely dependent upon them for the rocket engine, does not pose a risk to the cause of government launches? >> for the foreseeable future i see it as complementary. in the far future we will have ample opportunity to work out arrangements. >> if the ar one engine ultimately is not what is selected what is the future? >> currently it is relevant to this particular change in launch vehicles. we do not agree engine launch vehicles. every ten years we have different opportunities to do that. we maintain technology but

if there is not a launch vehicle provided that would use it development would not be completed at this time. >> is there a chance that provider might materialize and one would find itself relevant in both? >> it is possible. it clearly depends upon what some of the launch vehicle providers paths going forward are. there are multiple providers on this panel command we have talked about a limited market. in the near in the near term it is not a high probability >> one of the challenges we have is certainly it seems like there are two different directions that the panel is trying to accommodate. one is the air force position needing to purchase launch as a service

which has been the going mindset for everyone for quite a while. we ended up in a position where the russians got aggressive. i share the chairman's position. we do not want to spend -- send one more dollar to rush of them we don't have to and i agree with chairman rogers that we must mitigate the risk to our own assured access to space which is what drove us to this position today where we have language that might not be compatible with language that says we need to purchase launches the service. this is a challenge we will continue to have. the panelists find themselves in a challenge where they are trying to go to different directions at the same time given what has happened in the world and we need to make this the

best for our country. chairman rogers has that in his heart. the goal is to get off any russian engine and make sure we have assured access to space. we must make that happen. i appreciate you working through this with us as we try to make it happen. thank you very much. >> i think the gentleman and concur completely. >> one question. mr. myers and florez has a large methane rocket engine ever been built and flown in space? what are the advantages and challenges of building this type of engine? >> engines greater than 250,000 pounds of thrust no

large methane engine has been built and flown in space that i know of. we have been busily working and made specific design choices to mitigate risk with development, design choices and chamber pressure, injector, and materials that will give us confidence we can develop this engine by the end of next year, get into testing and meet of vulcan launch requirements. >> to your first question about forming a large methane rocket engine, no. one aspect that you hear a lot about the power plants that are being discussed i want to.out the one common thread raptor ar one or be. >> , really the combustion technology. all three engines incorporate that which

represents the technology coming to the table

chris garrett started started at the outset filed you about 2,000 not that there has been a lot of research developing in the private sector independent of investment. >> can i add one comment? liquefied natural gas the commodity structuring the us we chose lng because it is cheaper. it is available and plain. there interested in the

long-term which is important. >> i yield back. >> i think the gentleman. >> i thank you, mr. chairman a line of questions i was pursuing earlier. in response to in response to a question for the record from the last hearing, there has been no formal submission in the change to be accepted under certification for the full thrust system. if there has been no formal submission how is it your system should be certified for lunch or eligible for competition? >> i would have to get back to you on the specifics, but i can tell you presently there have been numerous

conversations to specifically address this information and the bulk of that has been provided and discussed but i am happy to take that provided for the record. >> that does not satisfy me. i will refer to an article from march 17 of this year us air force certification by mid-summer and here's a quotation. bear with me. this year a falcon nine upgraded with a 50 percent increase in thrust falcon nine marlen won the stage engine and 10 percent and upper stage tank volume

which is likely to require significant design modification to the engine and rocket which would necessitate additional certification work including a series of successful flights. how is it that second say these are significant modifications and that they require additional certification and possibly test flights and you don't think that there is a need for more certification? >> the language no need for more certification to clarify my statements were with regard to resetting the clock. there has there has been upgrades to the certification process long before. mainly focused on the fact that nothing different was being done in terms of bringing on new improvements

i can say that we are working closely with nasa and the air force who have both certified us and we have ongoing negotiations with them. they are fully read in an know what we are doing in terms of upcoming launch. >> okay. let me change gears. you stated that there should be a 5050 investment in a new engine. was that guideline followed? >> with falcon nine investment there was 100 percent investment in the development. >> you said 100 percent. it is my understanding the bulk of the capitol is

forward funded nasa contracts. is that correct? >> i cannot speak to the total, but the nasa money was focused on the dragon space capsule versus the falcon nine launch vehicle. >> thank you, and i yield back. i appreciate all of y'all. you made a great.about how we got ourselves into this situation room we stopped investing in the technology. our full attention is focused on the matter now and we appreciate you being here. i remind the i remind the witnesses we will keep the record open for at least ten days in case there are additional questions. i would appreciate a timely

response. we are we are about to have another panel of government witnesses. i hope that i hope that you listen to them and let us know what they say and help us to continue to move this policy in the right direction. with that this panel stands and recess and adjourns to bring the new panel in. [inaudible conversations] [inaudible conversations] [inaudible conversations]

>> i would now like to welcome the experts for our second panel. we have the honorable katrina mcfarland, general john cotton and general mcfarland 25 excuse me, it is me, it is great to have you back here. we appreciate your opinion and lieutenant general sam graves. we we also have doctor mike griffin representing himself today. he is also a former nasa administrator. i turn it over to you to start. you are recognized for five minutes to summarize your opening statement. all witnesses opening statements in full will be submitted for the record.

>> thank you, chairman, ranking member distinguished members of the committee. i appreciate the opportunity to appear before this committee. a shared access to space continues to be critical especially as our world has changed. during our march 17 hearing we touched on many topics concerning the evolved launch vehicle program. amongst them with apartments plan on curing launch services and our plan for transitioning away from the use of the rd 180 engine. while. while i am pleased to say where making progress competition and transition

is intertwined and this interdependency cannot be ignored but must be managed. as you have heard this is a complex issue. with the falcon nine launch system we have for the first time since the joint venture enabled competition. however, section 1608 prohibits any use beyond the block one contract for our most cost effective launch capability which relies on the russian rd 180 engine. as enacted it creates a multi- year gap and trades as the sole provider on launches. it also impacts the

viability to compete in the future, as discussed, as an estimate of seven years. it is a complex issue. to avoid this unacceptable situation the department submitted legislative proposal requesting it be amended. the department believes this proposal combined enables the department to minimize impact while they complete the transition using domestically designed and produced systems. the department greatly appreciates the subcommittee support of the legislative proposal. the appropriation language. the air force released a request for information and you have heard some earlier.

the industry soliciting feedback and the response support of supported the strategy to kill invest and transition. markedly broader approaches than anticipated, as you heard. ..

distinguished leagues thank you all for your efforts to work this hard topic. it's a difficult topic to work through so everyone has been fortunate enough to witness while the theater commanders have realized how fundamental they are too military person that takes place in the globe today. however these are an illusion without a short access to space. the short access has gone from important to him. if it remains one of our highest priorities. the industry has fundamentally changed over the last few decades. they no longer on the vehicles the launch. we purchase access to the spaces and services and industries now investing large amounts of private capital in developing

new engines and rockets and we are collaborating closely with them to determine how best to invest in the public-private partnerships and the systems. in the context of a short assured access to space at this critical that we move as fast as we can to eliminate the engine. the united states shouldn't remain to have access to space and we need an american hydrocarbon engine. it will be a significant challenge, but we think with the the effort and ingenuity of the government industry team as it is possible to develop the engine by 2019. however, the engines to us to be made into a rocket exhaust the made into a complete space launch system. we still need to test and certify and altogether a year or two once the engine is developed. if it is expended on the rocket and the provider has built or modified necessary rocket. the subcommittee can be assured

of that commitment to the healthy space launch industrial base as we move as fast as we can towards the rocket engines. thank you for your support and i look forward to continuing the partnership and your questions. >> general you are recognized. >> general cultures ranking member cooper and its establishment as of the committee thank you for the opportunity to appear before you today. space capabilities are essential for the american way of life and way of life and they multiply the effectiveness of the war fighters. thanks to the efforts of the men and women in the nation debate commission center many contractors and many mission partners we continue to deliver worldwide decision navigation, threat warning protected strategic communications and many other capabilities from space. as we have all come to know space launch is the key to providing all of that capability. we address the critical nature of the space launch through the

policy of assured access to space maintaining at least two systems as a credible method for continued access to space should one suffer. as part of this approach, we purchased the launch of services on a commercial basis without ranging the most important source of innovation and national economic strength in the free market. these concepts short access to space and competition are the cornerstones of the national launch policy. they guide the implementation as we execute the national defense authorization act which outlines the use and mandate that we develop a next generation rocket propulsion system. in response i will emphasize that the air force is 100% committed to transitioning the space launch as quickly as

possible to a domestically produced rocket propulsion system. from our perspective, replacing with the new engine is not the complete solution since they are heavily influenced by engine design. even the replacement that matches the interface performance would require the heat shields to accommodate even minor differences in the performance. as was mentioned by the previous panel the engine is a critical characteristic of the atlas. the new engines will require changes to the electronic control systems and the analysis to develop new flight profiles to launch the various satellites so in other words, the rocket engine specifically engineered

to replace on the atlas would most likely be used for the & modify any other launch service provider without a significant modifications to the engine and/or the vehicle. this also wouldn't meet the intent of the open composition. additionally as a product of the market research, we found if we procured procured a ninja not designed for a specific launch vehicle the commercial providers would be likely to present a rocket around it without the government also funding a redesign of the launch vehicles at a time, cost and risk we cannot afford so they are pursuing a strategy of shared investment with industry using public-private partnerships. the goal of the plan is to produce at least two domestic commercially viable launch systems including the accompanied.

in the research we assess the timelines predicting complete rocket propulsion systems by 2019 are aggressive. history has shown testing and maturing the engine takes six to seven years. with another beyond that to be able to integrate into the vehicle. now with all of that said they are moving fast on this. we've developed a acquisition strategy to reach its end state as quickly as possible. step number one pursues the technical maturation and risk reduction efforts building the expertise within the u.s. this september to the shared investment in the rocket propulsion system development cost of three design debate could divide the investment into the system and finally step four directs the services to meet the national security space requirements. as we move forward our overall goal is to preserve the access

to space i am maintaining the laser focus on the mission success. our approach will accomplish this by supporting the competition where it credibly exists and by acquiring the speech launch -- space launch by using the domestically produced rocket propulsion system. if we do this, we will be on a path to transitioning off of the r. 8182 having the commercially viable launch providers that are certified to meet national security space requirements at the end area thank you for your support in helping us get here. and i look forward to your questions. >> thank you. doctor griffin you are recognized. >> chairman ranking member and distinguish numbers of the committee, i am honored to be asked to appear before the subcommittee to testify on the matter before us today. however before beginning any

substantive discussion i think that i should note for the record that i'm here as an independent witness and a private individual. i've received no consideration of any kind in connection with the topic of today's hearing from anyone. i'm here on personal leave and a personal expense and i do not represent any company, each of your committee on which i served in the past or present these are. with that said, we are here to discuss the replacement. it's been used for two decades on various versions of the atlas and without that engine or the equivalent replacement of today's atlas vehicle will be grounded and with it two thirds of the national saturday payloads as we presently have the manifest. while i agree that we shouldn't continue to be dependent on a foreign power which left an adversary for any element of the national space launch

capability, i do believe that the legislative action which has been taken in this regard is a bit abrupt. it might be that we should wean ourselves of this dependent of the more gently. but if the atlas is grounded then what? u.s. policy and law required the systems for the national security space launch capability this requirement is met, but only partially so with the delta for family. previous family said that they could be shifted from apples to the delta four. that is so with many of the payloads are not immediately interchangeable between the vehicles and would require a considerable rework and cost to shift from applets to delta and moreover it is in general more expensive than the equivalent. and it is less than that of the top and atlas. so, some atlas payloads will not be transferable to delta.

finally, the delta production limitations are such that without a massive increase in manufacturing and launch infrastructure very limited search capacity is even possible. so the effect of shifting the national security systems should we have to do so will be several years of delay for the average payload and many billions of dollars of increased cost. some have said that the best forward path is to discard the decades of government investment in an experience and develop a whole new system. this does nothing to solve today's problems. and even if it did it is irrational to suppose an entirely new launch vehicle could be obtained more quickly or at less cost than the new engine allowed. others would have us believe that the u.s. government can nearly purchased the launch services from among the multiple competitors as if one were selecting a particular airline for the desired trip based on airfare and schedule.

purveyors of this launch as a service view of us believe if we have an engine supply problem the government should stay on the sidelines while the market solves the problem. but in reality the u.s. national security launch architecture is a strategic kid ability having far more in common with other strategic asset such as fighters, bombers come aircraft carriers and submarines than it does with airlines and cruise ships. it cannot determine whether or not they make it to space. accordingly the government must be prepared to ensure that the supply-chain required to maintain this critical asset remains intact. that's supply-chain is frankly the supply-chain is frankly quite fragile because while we've been supporting the russian rocket engine industrial base from our own has withered. to conclude we have an engine problem, not a rocket problem. i believe we should solve it by building a government owned

american equivalent as quickly as we can possibly do so. we shouldn't allow them any obfuscating is that have been raised to cloud our view of what must be done. thank you. >> before i get into my questions and prepared you heard the previous panel. is anybody just chomping at the bit to take on something that came out in the previous panel that you think the committee needs to hear for sure? i need to comment on one of the last statement by the representative that the development of the falcon nine was done on the private funds. i personally am the originator of the program and the program was intended to provide cd.

and i emphasize seed money enough majority funding for the development of a new launch vehicle for the cargo to space station. after i left the agency with the inauguration of president obama considerably more money was supplied. i think from public sources it is easily possible to show it has received about $3.5 billion were supposedly more in open source funding. seeing as how they have conducted seven launches counting the one upcoming this week. that is at high price per launch of about half a billion dollars per launch, which i don't believe is the case were a considerable amount of that money to capitalizing the money. it wasn't segregated out according to dragon or falcon

nine so i believe the government which has been provided has gone for the development of the falcon nine. you heard me hope optimistically more than two companies were granted be competing for this engine, and i hope that we will wind up with three or four or more getting in the competition when it really gets going. okay. in last year's 2014 space hearing i asked the witnesses if they think that the thing that next-generation engine available to all u.s. providers that could effectively replace was important. the general predecessor stated, quote, i would be a strong supporter of that if we could find the money to do it. >> i think in the long run it's

in the interest of the government to develop the next-generation rocket coming u.s. produced rocket. we took your advice and directed the department to build a department to build a domestic system than engines by 2019 and we provided 220 million just to get started. but now when i read your plan isn't clear to me that we are focused on developing the engine. what has changed since the testimony? and i would like to ask what the all of the witnesses in your judgment if we have two options to replace it with a proven technology or to build with an unproven technology the new launch vehicle and infrastructure. what is the risk? most expedient and lost cost to the taxpayer.

>> my first comment is that the united states leads the world in two elements we lead the world in solids and hydrogen engines. i think we should leave the world in every category of the engine development. the one we don't is the hydrocarbon development. i believe the united states, no matter what the united states should develop a technology program that builds the hydrocarbon technology for the united states across the board. and i think it is essential to what we do as a country. we have avoided that for about 20 years and we want to take that on and go forward. however the second issue is what's changed since last time we talked as we actually have a bill. we have a national defense authorization act that gave us very specific items and it said we need to pursue engines for

the national launches that tell plus they had to be made in the united states. they have to be made about national security space community. i think they did that. develop and 2019 that is a challenge but we heard that. and then developed using the pool open competition. the competition is exactly the structure we put in place. we were specifically told by the law not to go to the specific vendor not to go to a specific to a specific agenda to cope with it fully and open competition across the industry and we looked at the previous panel. the thing that struck me about the previous panel that was impressive is how much they have embraced that across the board from the blue origin to space x. to embrace that. so the competition was important. but when you do pull in open competition you have to go through the process to make sure it is open and fair. that doesn't happen overnight so

i would make those comments for the record. >> you asked whether or not we should replace with proven technology. as the previous panel did express, we do not have the capability within the united states today to replace the engine. so whatever we come up with, it will be a new engine. from our point of view replacing an engine has effects on the overall capability to be planned to deliver. so, we must verify the impacts of any changes to any component in the system especially the engine on the rocket itself and the ability to deliver the capability to orbit. so combined with the general just mentioned, our approach is to look at the total capability the total system that will result from any changes to any component to include the engine,

and that's why we start from the launch service alternative ability to assess what the impacts are independent site whether or not as you will see in the four step process that we have in place whether or not any of the providers -- and by the way, we did have what they were referencing as a broad response in the industry to the proposal that we put out there. so there is interest that we must look at the impacts from any changes. >> i think it was very clear one thing that came out from the previous industry there isn't a drop-in replacement on the table not an exact replacement. so we are focused on the risk.

how do we leverage. what be leveraged from the government and the risk to the government and we pass data back to the industry or do we take and work together the industry and funding and share the risks? i call it it the pini now and pay me later. each of these industries have already stated there is a limited industrial base for the commercialization immediately. i shared with you earlier that satellite industry association study that says there's there is a modest growth between four to 9%. in the commercial world they don't use the size that you are familiar with that we have for the payload. so, we carry no matter what and underwriting of whatever comes out of here and because we don't have this and we haven't developed as it's been stated

repeatedly understanding of the metallurgy of the methodology to do the proportions in exact form we have to assess we have to have a modicum of risk. therefore the proposal as it stands they are pursuing getting the government and industry together to the point they can make a logical decision. can we go forward with a launch system should we look at just the engine and what is the most cost effective and timely. the advancements from the industry the question is where to be placed at risk and how can we afford it, particularly as i mentioned also earlier with the ranking member we are concerned with sequestration rate in the midst of trying to rush into moving forward on this

replacement. it hits us right at the weakest joint by 16. >> you heard the witness in the previous panel talk about the degree of modification that would be required to take one of the proposed rocket engines and put it on the rocket itself and they didn't disagree with #heard earlier of the $200 million for not just the rocket for all of the infrastructure changes and above the floor. is that no matter which alternatively select? >> the numbers that i heard we will know more as we actually get into the contract activities with them. the general will be going down

that path with him directly but i think those are ballpark numbers and airfare to look at. they are off tens of millions i think that 200 million. >> one big change from the last assured access hearing to this hearing has been striking to me is the idea of getting 2019 for the completion of testing and providing the system for air force certification seemed in vicious but realistic. now you heard in a previous panel with high degrees of confidence they believe that they will have not only completed the testing of the systems, but complete the certification easily by 2019. >> general, you seem to have concerns about that. did you think that is just optimism or silly? >> i believe they are discussing the certification of the engine. when we talk certification we are talking in the systems of

the engine plus everything from any modification brings with it software structures flight dynamics, processing, manufacturing and that is what we refer to in the certification. so, i do the leave that it is aggressive and that is only part of the answer. >> you created a new question for the record for the industry panelists because we are going to find out if they were talking about what certification process. >> i was listening close and the court was ready to integrate and fly in 2019 and the rocket had certification of the engine in 2019. so does a great question for the record that i was listening very close to to the the fastball to hear what they said about the certification.

>> of the wide debate co. barge technology is one that would let go of the peril. we never agreed not to have it. we just did a make or buy decision and we decided to buy it. that option doesn't look so smart right now and so i think we need to relearn how to make it. i'm not interested in replicating the technology. i'm interested in going beyond it and that is what i believe that we will and should do. there is a considerable interest of the parties in the difficulty of the launch vehicle. i don't think it is a 10 million-dollar problem. i compiled an incomplete list of 14 different engines which have

been used on a plethora of different vehicle's in stages. it's over 50 some years of space history it would be happy to submit that for the record but it's not so horribly difficult to engine the vehicle as some of our earlier witnesses were saying. >> i will submit that for the record i just simply don't believe it to be difficult. >> before i go to the ranking number, general i want to go back to the specific language you wrote down when blue blue origin said they would be ready to fly by 2019 how did you interpret that?