ROANOKE TIMES
Copyright (c) 1996, Roanoke Times
DATE: Tuesday, October 1, 1996 TAG: 9610010070
SECTION: VIRGINIA PAGE: C-5 EDITION: METRO
DATELINE: CAPE CANAVERAL, FLA.
SOURCE: Associated Press
In the biggest change in the history of the space shuttle program, NASA is turning over day-to-day operations to private industry beginning today to save money.
``Today is the first day of a new space program in America,'' NASA Administrator Daniel Goldin said Monday in announcing the $7 billion, six-year contract with United Space Alliance, a joint venture of Rockwell International Corp. and Lockheed Martin Corp.
Officials promise the shift will be gradual, with shuttle flight safety the No.1 priority.
In the short term, not even NASA and its contract employees will see much difference.
NASA still will give the final ``go'' for launch and make the important decisions during a shuttle flight, as it has for the past 15 years. It will retain ultimate responsibility for shuttle safety and hire the astronauts. And it will still own the four space shuttles.
But it will ease itself out of the routine, day-to-day work, such as preparing the shuttles for flight, training the astronauts and operating Mission Control. Those duties will belong to United Space Alliance.
Don't expect shuttle ads anytime soon, though, or shuttle seats sold to the highest bidder.
Maybe that will come later, said Kent Black, USA's chief executive. Much, much later.
The contract, which was announced Monday but was actually signed late last week, designates United Space Alliance as the single prime contractor for shuttle operations. It includes two two-year extension options that could bring the contract's total estimated value to $12 billion over 10 years.
USA was formed in August 1995 and chosen by NASA as the single prime contractor three months later.
By compressing many contracts into one - this first phase consolidates 12 previous contracts - NASA hopes to improve shuttle safety, continue to fly shuttles seven or eight times a year, and reduce costs in the $3 billion-a-year shuttle program.
Because Rockwell and Lockheed Martin already handled most of the shuttle work, the transition, while historic, won't make much immediate difference.
NASA and USA officials said they could not specify how much money would be saved.
Some NASA employees question whether USA can do the job as promised, especially with construction of an international space station just a year off, and they fear reduced government oversight could lead to another Challenger-type disaster. Some fear that the changeover itself could prove a distraction that could lead to potentially fatal mistakes.
USA officials expect to save at least $400 million in shuttle costs over the six-year life of the contract, probably much more.
Less NASA involvement also means fewer NASA jobs, a money-saving goal of the Clinton administration that has caused morale to plummet at the Kennedy Space Center.
Already, thousands of shuttle jobs have been cut. USA officials promise no major layoffs, at least in the next few years.
Under the agreement, USA will be penalized for failing to meet safety and mission objectives. The better the company does, the more it will earn and the more taxpayers will save.
``We are telling the contractor we're going to give you 35 cents of every dollar that you save us,'' Goldin said. ``May they get very rich because the taxpayer will get very rich, because we get back 65 cents.''
LENGTH: Medium: 69 linesby CNB