The Space Reviewin association with SpaceNews

Xerus illustration
XCOR’s Xerus is one of a number of proposed suborbital RLVs in need of an improved regulatory environment. (credit: XCOR/Space Adventures)

The regulatory hurdles to commercial human spaceflight

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Tito’s turnaround

Tito’s presence at the hearing initially appeared to be to address the issues surrounding space tourism from his vantage point as the first commercial space tourist. However, during the hearing, Tito made it clear that he plans to take on another, potentially more significant role: as an investor in suborbital RLV companies.

This represents a major change for Tito, who in the past has been lukewarm, at best, about suborbital space tourism and investing in such ventures. “A suborbital flight is what you would call a joyride in my view,” he said during a speech at the National Air and Space Museum in January 2002. “I just don’t see how it would be worth it.” At that time he also indicated that he planned to focus his energies on his investment company, Wilshire Associates. “I don’t have time to get into the space exploration business,” he said.

Now, however, he has come to realize that suborbital space flight would still offer many of the benefits of an orbital space flight. “It began to dawn on me that a suborbital experience was of real value, even though it gave someone possibly only a three-minute slice of being in space,” he said at the hearing. “I know a business opportunity when I see one, and this is indeed a huge business opportunity.”

Tito declared his intent to invest into the industry at the hearing. “I am ready to make an investment in a suborbital vehicle,” he said. “I’m different than most investors in that Wall Street will look at a business opportunity solely on the financial merits. I am a person who is passionate about space and it’s a lot more than the rate of return on investment that is important to me.” After the hearing sources indicated that Tito has in fact selected a particular, unidentified company to invest in.

However, Tito doesn’t plan to make that investment until the current regulatory uncertainly is resolved. “I think the technological hurdles can be dealt with. I think the market is there. I’m not afraid of the competition,” he said. “The only big problem that stands before myself and others who want to do this is the regulatory risk.”

Liability and environmental issues

In addition to concerns about how suborbital RLVs would be regulated, panelists also expressed concerns about liability issues. Noting that the general aviation industry in the US almost went out of business in the 1980s because of huge liability judgements, saved only by new laws that put limits on the liability of aircraft manufacturers, the industry wants the ability to have passengers on RLVs waive any liability claims before flying, and also make sure the flights of passengers on RLVs are not strictly regulated by the government.

“I know a business opportunity when I see one,” Tito said of suborbital space tourism, “and this is indeed a huge business opportunity.”

“I and my engineers will fly aboard our vehicles long before we consider them safe enough for paying customers,” said Greason. “Nor would we ever consider flying someone who was not fully informed of the risk involved. If Americans are willing to risk their lives and wealth to open a new frontier, why should we stop them?”

“We have to realize that individuals are assuming risk and with some evaluation, maybe medical and psychological, and training, they should be able to assume risks that are different than what the general public will assume by walking onto an airliner,” said Tito.

Companies are also looking for relief from environmental regulations, which often require filling out large volumes of forms and reports even for vehicles that pose no risk to the environment. Elon Musk, a former Internet entrepreneur who sold PayPal to eBay for over $1 billion last year, is currently dealing with such regulations while developing the Falcon unmanned launch vehicle for his new company, Space Exploration Technologies. He noted that his company has to spent $10,000 per launch to prove that the launches do not harm the seals that live in the waters off the coast from Vandenberg Air Force Base in California, even though the population of seals grew by 12.7 percent last year. “With that population growth rate,” he noted, “it seems clear that, if anything, the Vandenberg launch activity serves as an aphrodisiac.”

Musk argued for a blanket environmental impact statement that covers all vehicles within a certain size as a way to reduce the paperwork burden. He also called for a “zero-based revision” of existing regulations covering range safety approval, including the creation of a standardized flight termination system that uses non-explosive engine shutdown instead of the explosives currently used.

Congressional reaction

Although the event was billed a joint hearing by the Space and Aeronautics Subcommittee of the House Science Committee and the Science, Technology, and Space Subcommittee of the Senate Commerce Committee, the hearing was sparsely attended by actual members of Congress. Only two senators—Sam Brownback, chair of the subcommittee, and Bill Nelson, the ranking Democrat who flew on the shuttle in 1986—attended, and Nelson left during the opening statements, citing a meeting with the Palestinian prime minister. About a half-dozen House members attended at least part of the hearing, including subcommittee chairman Dana Rohrabacher and ranking minority member Bart Gordon.

If the government doesn’t offer clear regulatory guidelines for commercial space transportation operators, said Rohrabacher, “they can strangle this baby in the cradle.”

Those who did attend did express general interest in and support of commercial human spaceflight, but for different reasons. Brownback said he saw commercial spaceflight as one part of an effort to “embrace a new vision, an idea of dominating commercially, militarily, and for exploration, the Earth-Moon orbit.” Along those lines, he said, “we must increase the sources and numbers of entities entering space.”

“The federal government has the power to promote investor confidence by providing a clear regulatory guideline for commercial space transportation operators,” said Rohrabacher, a long-time proponent of increased commercialization of space. “They can do that, or they can strangle this baby in the cradle.”

One note of concern was raised by Gordon, who raised issues of safety and liability during his questioning of the witnesses, and also seemed to confuse the issues of third-party liability with individual passenger liability. “It seems to me that if we’re going to have a successful commercial space tourism industry there has got to be the perception that there’s at least some reasonable level of safety and reliability,” he said.

“It is safe enough when the customers start to show up,” Greason said. He noted that long before his company is satisfied that the vehicle is safe enough to put into revenue service, “we will have demonstrated safety far superior to what people think of spaceflight safety as being right now.”

When Eddie Bernice Johnson, a Congresswoman from Texas, asked the panelists what they thought the government’s role should be, Greason provided a succinct answer. “Let us fly and keep the general public safe.”