	Recent Trends in the Commercial Space Launch Industry

To date, the commercial space launch industry has primarily focused on  putting payloads, such as satellites, into orbit, using launch vehicles that  are used only once. The number of launches for this purpose has,  however, dropped off, and the industry appears to be increasing its focus  on space tourism. Concurrently, companies and states are developing additional spaceports  to accommodate anticipated commercial space tourism flights, with states  providing economic incentives for development. Manned commercial space launches took place for the first and only time  with the five manned flights of SpaceShipOne in 2004. The Number of Spaceports Is Increasing

Since we reported in 2006, private companies and states are developing  additional spaceports to accommodate anticipated commercial space  tourism flights and to expand the nation’s launch capacity. Challenges Facing FAA in Overseeing the Commercial Space Launch Industry

FAA faces challenges in ensuring that it has a sufficient number of staff  with the necessary expertise to oversee the safety of commercial space  launches and spaceport operations. In addition, FAA will need to  determine whether its current safety regulations are appropriate for all  types of commercial space vehicles, operations, and launch sites. Regulation of Crew and Passenger Safety after 2012

Although FAA is prohibited from regulating crew and passenger safety  before 2012 except in response to serious injuries or fatalities or an event  that poses a high risk of causing a serious or fatal injury, FAA is  responsible for the protection of the uninvolved public, which could be  affected by a failed mission. However, FAA has not developed indicators that it would  use to monitor the safety of the developing space tourism sector and  determine when to step in and regulate human space flight. Distinguishing FAA’s Dual Role of Industry Promotion and Safety

In 2006, we reported that FAA faced the potential challenge of overseeing  the safety of commercial space launches while promoting the industry. We reported that  as the commercial space launch industry evolves, it may be necessary to  separate FAA’s regulatory and promotional activities. Emerging Issues

The expected expansion of the U.S. commercial space launch industry due  to anticipated events such as the development of space tourism and the  retirement of NASA’s space shuttle and the agency’s shift to using the  commercial sector to provide space transportation will affect the federal  role in various ways such as increasing FAA’s licensing and regulatory  workload. To assist in the expansion of the industry, other issues will  emerge for federal agencies and Congress to consider, such as whether to  assist the industry in lowering costs by extending existing liability  indemnification and how to enhance the global competitiveness of the U.S.  industry. Lack of an Overarching National Space Launch Policy

Finally, an overarching issue that has implications for the U.S. commercial  space launch industry is the lack of a comprehensive national space  launch strategy, according to federal officials and industry experts. Appendix I: Status of GAO’s Recommendations to the Federal Aviation Administration Concerning Commercial Space Launches

	The Federal Aviation Administration (FAA) needs to assess the level of expertise and resources that will be needed to oversee the safety of the space tourism industry and the new spaceports under various scenarios and timetables.
Why GAO Did This Study

Since the Government Accountability Office (GAO) reported on the commercial space launch industry in 2006, the industry has evolved and moved further toward space tourism. Commercial space tourism promises to make human space travel available to the public for the first time. The Federal Aviation Administration (FAA) oversees the safety of commercial space launches, licensing and monitoring the safety of such launches and of spaceports (sites for launching spacecraft), and FAA promotes the industry. FAA is also responsible for overseeing the safety of space tourism, but it may not regulate crew and passenger safety before 2012 except in response to high-risk incidents, serious injuries, or fatalities. This testimony addresses (1) recent trends in the commercial space launch industry, (2) challenges that FAA faces in overseeing the industry, and (3) emerging issues that will affect the federal role. This statement is based on GAO's October 2006 report on commercial space launches, updated with information GAO gathered from FAA, the Department of Commerce, and industry experts in November 2009 on industry trends and recent FAA actions. In past work, GAO recommended that FAA take several actions to improve its oversight of commercial space launches, including assessing its future resource needs. FAA has taken some steps to address the recommendations.

What GAO Found

Recent Trends: Historically, the commercial space launch industry focused primarily on putting payloads, such as satellites, into orbit, using launch vehicles that did not return to earth. Such launches have, however, dropped off, and the industry is increasing its focus on space tourism. Since five manned commercial flights demonstrated the potential for commercial space tourism in 2004, companies have pursued research and development and are further developing reusable vehicles for manned flights. Concurrently, companies and states are developing additional spaceports to accommodate anticipated increases in commercial space launches. States have provided economic incentives, and FAA has provided some funding for development. Oversight Challenges: In overseeing the commercial space launch industry, including the safety of space tourism, FAA faces several challenges. These include maintaining a sufficient number of staff with the necessary expertise to oversee the safety of launches and spaceport operations; determining whether FAA's current safety regulations are appropriate for all types of commercial space vehicles, operations, and launch sites; developing information to help FAA decide when to regulate crew and passenger safety after 2012; and continuing to avoid conflicts between FAA's regulatory and promotional roles. Emerging Issues: The U.S. commercial space launch industry is expected to expand as space tourism develops and the National Aeronautics and Space Administration starts to rely on the commercial sector for space transportation. This expansion will affect the federal role. For example, FAA will face increases in its licensing and regulatory workload, and federal agencies and Congress will face decisions about whether to support the U.S. industry by continuing to provide liability indemnification to lower its costs. Additionally, FAA will face policy and procedural issues when it integrates the operations of spacecraft into its next generation air transportation system. Finally, coordinating the federal response to the commercial space industry's expansion is an issue for the federal government in the absence of a national space launch strategy for setting priorities and establishing federal agency roles.