See figure 3. FAA’s primary means of authorizing space launch activities is through its  licensing process which includes: licensing launch and reentry vehicle  operations, reviewing applications for experimental permits, reviewing  safety approvals, and conducting safety inspections and oversight of  licensed and permitted activities, among other activities. The U.S. Commercial Space Launch Industry Has Expanded in Recent Years

As we reported in our 2015 report, during the last decade, U.S.  companies conducted fewer orbital commercial launches in total than  companies in Russia or Europe, which are among the main foreign  competitors. In  2015, U.S. companies conducted more orbital launches than companies  in Russia, which conducted five, or Europe, which conducted six. In 2015 we found that a number of factors are responsible for the recent  expansion of the U.S. commercial space launch industry. Third, the emerging space tourism industry and small satellite industry in  the United States also may help the U.S. commercial space launch  industry expand. FAA Faces Multiple Challenges Regarding Developments in the Commercial Space Launch Industry and Requested Additional Resources to Address Some Challenges

		Challenges

In our 2015 report, we asked FAA officials, representatives from nine  commercial space launch companies, and three experts to identify the  challenges that FAA faces—and is likely to face in the near future—to  address significant developments in the commercial space launch  industry over the last decade. The challenges for FAA that they identified  included: (1) determining whether and when to regulate the safety of crew  and spaceflight participants and (2) handling an increased workload  relating to licensing and permitting launches and launch sites. In addition,  in our 2015 report, we noted that changes in the number and types of  commercial space launches could affect the government’s overall  exposure and indemnification for launches. As part of the  U.S. Commercial Space Launch Competitiveness Act, Congress  required FAA in consultation with an industry advisory group—the  Commercial Space Transportation Advisory Committee—to submit  two reports to Congress on this topic. In the future, FAA also will need to  license launches for NASA’s commercial crew program and  potentially launches of companies placing small satellites in orbit. For example, Virgin Galactic’s SpaceShipTwo, XCOR’s  Aerospace’s Lynx, and Blue Origin’s New Shepard are new vehicles. We  recommended that FAA review its maximum probable loss methodology. FAA Request for Resources

In 2015 we found that FAA’s budget requests for its commercial space  launch activities generally were based on the number of projected  launches, but that in recent years the actual number of launches was  much lower than FAA’s projections. According to FAA officials, more detailed  information was not provided in their budget submissions because the  agency lacked certain workload metrics regarding its commercial space  launch oversight activities. We also found that the Office of Commercial  Space Transportation did not track the amount of time spent on the  office’s various activities. To provide Congress with more information about the resources  requested to address developments in the commercial space launch  industry, we recommended that FAA provide more detailed information in  its budget submissions about its workload. FAA has taken steps to implement our recommendation. In the 2017 budget submission, FAA provided workload indices based on  the number of authorizations which the agency uses to authorize  companies to conduct one or more launches, the number of licenses and  permits, the number of on-site inspections as part of licensing launch  sites, and staffing levels since fiscal year 2006.
Why GAO Did This Study

The U.S. commercial space launch industry has changed considerably since the enactment of the Commercial Space Launch Amendments Act of 2004. FAA is required to license or permit commercial space launches; however, to allow space tourism to develop, the act prohibited FAA from regulating crew and spaceflight participant safety before 2012—a moratorium that was extended to 2023. The U.S. Commercial Space Launch Competitiveness Act, enacted in November 2015, addressed other aspects of the commercial space launch industry.
This testimony summarizes and updates findings from GAO's 2015 report, specifically industry developments and FAA challenges, including FAA's launch licensing workload and budget. For its 2015 report, GAO reviewed FAA's guidance on its launch permit, licensing, and safety oversight activities; interviewed FAA officials, industry stakeholders, and experts who were selected on the basis of their knowledge of FAA's oversight of the commercial space launch industry; and visited spaceports where two 2014 launch mishaps occurred. To update this information GAO reviewed FAA information on the industry and FAA's budget request.

What GAO Found

In 2015, GAO reported that during the last decade, U.S. commercial space launch companies conducted fewer orbital launches in total than companies in Russia or Europe, which are among their main foreign competitors. However, the U.S. commercial space launch industry has expanded recently. In 2015, U.S. companies conducted eight orbital launches, compared with none in 2011. In addition, in 2015, U.S. companies conducted more orbital launches than companies in Russia, which conducted five, or Europe, which conducted six.
In 2015, GAO reported that the Federal Aviation Administration (FAA)—which is responsible for protecting the public with respect to commercial space launches, including licensing and permitting launches—faces challenges. According to FAA officials and industry stakeholders, FAA faces an increasing workload licensing and permitting launches for transporting cargo, and in the future, crew for NASA's commercial space programs, space tourism, and potentially launching small satellites. FAA also faces the challenges of whether and when to regulate the safety of crew and spaceflight participants—in 2015 Congress extended the moratorium to 2023—and overseeing new types of vehicles and technologies. (See figure for commercial space launch vehicles.) Challenges also include updating FAA's method to calculate maximum probable loss—the amount above which the federal government indemnifies the industry for catastrophic loss.
Virgin Galactic's SpaceShipTwo and SpaceX's Falcon 9
GAO reported in 2015 that FAA's budget requests for its commercial space launch activities generally were based on the number of projected launches, but that in recent years the actual number of launches was much lower than FAA's projections. GAO also reported that, according to FAA officials, more detailed information was not provided in FAA's budget submissions because the agency lacked information on its workload overseeing commercial space launch activities. In addition, GAO reported that the Office of Commercial Space Transportation did not track the amount of time spent on various activities. FAA has taken steps to implement GAO's recommendation that it provide more detailed information in its budget submissions regarding commercial space transportation activities. In its 2017 budget submission, FAA provided workload indices regarding authorizations under which companies conduct one or more launches; on-site inspections; licensing of spaceports; and staffing levels since 2006.Why GAO Did This Study

What GAO Recommends

In 2015, GAO recommended that FAA, in its budget submissions, provide more detailed information about the Office of Commercial Space Transportation's workload. FAA agreed with the recommendation. GAO is not making new recommendations in this testimony.