October 2, 1998

Dear Mr. Lew:

The Administration recently requested Congressional support for an FY1998 budget reprogramming to enable NASA to pay the Russian Space Agency $60 million so the Russians can continue working on the Service Module, the first element of the International Space Station which the Russians were to finance on their own. NASA made this request after the Russian Space Agency confirmed to the United States that it received only 6% of its required funding in 1998 and that the Russian Space Agency needed $60 million by the end of September in order to avoid slipping the Service Module launch date past July. NASA briefed Congressional staff on September 15^th that this initial payment would not ensure that the Service Module was delivered in July. That would require an additional $40 million for the Russian Space Agency in the last quarter of calendar year 1998, followed by future payments of $110 million in the remainder of FY1999 and $150 million per year thereafter to ensure that Russia provided a minimal number of Progress resupply flights and Soyuz vehicles to the International Space Station. There are only two options for avoiding these payments during the life of the program. Either the Russian government could start providing reliable and adequate funding to the Russian Space Agency, an option that appears dubious at best, or the United States could develop an independent propulsion capability that would eliminate our long-term dependence on Russian Progress spacecraft. In your testimony before the Committee on Science on August 5^th, you rejected the latter option stating, "The best information we have at the moment does not lead us to make the judgment that we need to jump to the conclusion that the Russians will not be able to meet any of their commitments."

The Honorable Jacob Lew

October 2, 1998

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Clearly, we have new information in the Russian Space Agency’s confirmation that it will not be able to meet the Russian government’s commitments to the International Space Station program due to a lack of funding from the Russian government. OMB’s decision to approve NASA’s reprogramming request indicates that you accept the report of the Russian Space Agency. Unfortunately, to date the Administration has submitted no plans to address these systemic problems, which have been ongoing since the end of 1995. As we indicated, the $60 million reprogramming submitted to Congress will not guarantee that the Service Module is delivered in July, much less that the Russians will be able to honor their logistics and crew return vehicle obligations throughout the life of the program. Thus, we are concerned that the Administration appears prepared to embark on a plan to pay the Russians to meet their obligations but has developed no estimates of how much that plan will ultimately cost. NASA believes the cost can be contained at $660 million because it assumes the Russian Space Agency will receive matching funds for the Progress and Soyuz vehicles from its own government and that NASA will be permitted to develop a independent propulsion capability that will eliminate our need for Progress vehicles after 2002. Neither assumption would appear warranted since the Russian government has only provided the Russian Space Agency with 6% of its required funding in 1998 and the White House has rejected initiation of an independent propulsion capability, which will take at least three years to develop. Thus, the Administration’s plan is likely to cost considerably more than $660 million. Unless things change radically in Russia, the annual cost of the Administration’s plan to the American taxpayers could easily double, or even triple if OMB continues to reject the development of an independent U.S. propulsion capability.

For these reasons, the Committee on Science quickly scheduled an oversight hearing for Wednesday, October 7^th so that Congress could review the implications of these developments and the Administration’s apparent acknowledgment that Russia cannot meet its obligations. In order to fully assess the long-term impact of these problems on our space program and the options for resolving them, Congress must consider out-year budget affects. Those decisions are not made at NASA, but are made by the President through your office. Thus, your appearance before the Committee is vital if Congress is to consider the reprogramming request submitted on September 29^th.

We have attempted to deal with these issues in the authorization process through adoption of the bipartisan Sensenbrenner-Brown amendment to the House bill authorizing NASA funding in FY1998 and FY1999. Currently, the Senate is considering similar language in its FY1999 authorization bill, but NASA and the Administration are actively lobbying against these provisions. The Administration’s logic in this matter appears contradictory, so we require someone of your stature with your responsibility for

The Honorable Jacob Lew

October 2, 1998

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addressing the "big picture" to try and explain it. Congress cannot consider supporting the Administration’s reprogramming request until you appear before the Committee and demonstrate that this approach is preferable to all others over the long term.

We look forward to your appearance at Wednesday’s hearing.

Sincerely,

FJS/ers

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