The FAA’s Six-Stepped Staircase to Space

Congress passed the Commercial Space Launch Act (the “Act”) in 1984. In 2004, Congress amended the Act with the Commercial Space Launch Amendments Act (“CSLAA”). The Act in its current form governs commercial spaceflight and commercial human spaceflight operators (collectively, “Operators”) in the United States. The CSLAA has resulted in a six-step process for Operators to get launch, reentry, and launch site licenses from the FAA. The article describes those six steps.

Who’s In Charge?

The Act authorizes the Secretary of Transportation to license launch sites operated by U.S. citizens or within the United States (51 U.S.C. § 50904). The Secretary of Transportation delegated commercial space licensing authority to the FAA. As a result, the FAA licenses commercial launches, reentries, and the operation of launch sites (65 FR 62812 et seq. Oct. 19, 2000). In order to carry out its duties, the FAA issued and enforces the regulations at 14 C.F.R. Ch. III (the “Regulations”). The Regulations have a six-step licensing process: 1) preliminary consultation; 2) policy review; 3) insurance; 4) safety review; 5) environmental review; and 6) post-licensing requirements.

Preliminary Consultation

The FAA requires Operators to consult with it before applying for a license.  “A prospective applicant must consult with the FAA before submitting an application to discuss the application process and possible issues relevant to the FAA’s licensing or permitting decision” (14 C.F.R. § 413.5). The pre-application consultation is to identify possible issues at the planning stages when the applicant can still make changes to the proposed activities.

Policy Review

The FAA’s policy review is to decide whether the proposed mission adversely affects U.S. national security, foreign policy interests, and international obligations (14 C.F.R. § 415.23). The FAA consults the Department of Defense, the Department of State and any other federal agencies it deems appropriate to determine the impact of the mission on the United States’ various national and international policy interests. Once the FAA has consulted the other departments and agencies, it issues its decision. If the FAA issues a negative decision, the applicant can respond to the decision and argue that the mission does not negatively impact the United States’ policy interests.

Insurance

The Regulations also impose financial responsibility requirements on Operators. An Operator has to apply for the FAA to calculate the Operator’s Maximum Probable Loss (“MPL”). The MPL is a dollar value estimate of the risk caused by the Operator’s activities to government and third-party property. The FAA makes the MPL assessment. Once that MPL has been determined, the Operator satisfies it financial responsibility requirement by proving it can compensate the government and third parties for any damage caused. It can do so in one of three ways: 1) prove it has financial reserves equal to or exceeding the amount specified; 2) place the required amount in escrow; or 3) purchase liability insurance. The most common and preferred method is to purchase liability insurance. The Regulations governing this step of the licensing process are at 14 CFR Part 440.7 and App’x A to Part 440.

Safety Review

Applicants must then satisfy the FAA’s safety review. The goal of the safety review is to determine whether the launch and reentry can be conducted “without jeopardizing public health and safety and the safety of property.” 14 C.F.R. § 431.31.

As part of the safety review, an applicant has to maintain a “safety organization” (14 C.F.R. § 431.31). A “safety organization” is the lines of communication and approval authority for all mission decisions that may affect public safety. The lines of communication have to show communication between the applicant and the launch site, and the applicant and the reentry site. The applicant must also describe the chain of command it plans to have in place to ensure compliance with the substantive terms and conditions stated in the mission license.

In order to satisfy the FAA’s safety review, the applicant also submits a “communication plan” (14 C.F.R. § 415.37(b)-(c)). The “communication plan” identifies the people responsible for monitoring “safety critical” operations during the mission, and how these people can quickly, and effectively communicate time-sensitive and safety-critical information to each other. The plan includes protocols to define radio communications terminology. Finally, the communication plan must include procedures which reflect how each of the relevant members of personnel receives a copy.

The applicant also has to designate a “safety official” (14 C.F.R. § 415.33). The “safety official” is authorized to examine all aspects of the applicant’s operations as they relate to safety. The Regulations dictate that the “safety official” will independently monitor safety parameters and report directly to the person designated as being responsible for the conduct of all licensed mission activities.

Having established and submitted proof of an internal structure that ensures compliance with the law, an applicant must demonstrate to the FAA that its mission will meet the applicable risk standards (14 C.F.R. § 431.35). The acceptable risk for a proposed mission is measured in terms of the expected average number of casualties in the public (Ec). The acceptable average number of casualties for the public at large is less than thirty in a million. Additionally, the FAA will only issue a license if the danger to any one individual is less than one in a million. Under certain circumstances, however, the FAA can waive these requirements.

To determine whether it can waive safety requirements, the FAA will analyze whether the waiver: (1) would jeopardize public health and safety or safety of property; (2) would jeopardize national security and foreign policy interests of the United States; and (3) would be in the public interest.

Environmental Review

In addition to a policy and a safety review, applicants for a license must satisfy the FAA’s environmental review. Applicants provide the FAA information concerning the environmental impact of reentering the particular vehicle at the particular reentry site. The Operators do so by submitting an Environmental Assessment. The FAA’s environmental safety review determines whether the proposed mission complies with the National Environmental Policy Act, the Council on Environmental Quality Regulations for Implementing the Procedural Provisions of the National Environmental Policy Act, and the FAA’s Procedures for Considering Environmental Impacts (14 C.F.R. § 431.91). Based on the Operator’s EA, the government issues either a Finding of No Significant Impact (“FONSI”) or an Environmental Impact Statement (“EIS”). In case of the latter, the Operator has to come up with ways to mitigate the identified risks. Once that is done, and assuming satisfaction of the previous steps, the FAA issues the Operator a license.

Post-licensing requirements

The Regulations also impose post-licensing requirements. For example, a licensee must ensure that any representations it made to the FAA continue to be accurate.  If there are any changes, for example, to payload, light trajectory, flight-critical systems, launch or reentry site, the licensee is required to request a modification of its license from the FAA (14 C.F.R § 431.93). A licensee must also organize issuance of Notices to Airmen and Mariners with the local offices of the FAA and the U.S. Coast Guard, respectively. A licensee must maintain all records pertaining to the mission for 3 years after its completion, and provide specific information about the mission at specific intervals before the start of the mission.

A Parting Word

The purpose of this article is to de-mystify the process of applying for a launch, reentry, or launch site license as contained in the Regulations. It is easy for lawyers and non-lawyers alike to feel that the law is more complicated than it actually is, because of its convoluted wording and obscure expressions. As a result, many people don’t quite understand what the licensing process entails. Although this article simplifies the process which, no doubt, as a practical matter is quite complex, it aims to explain the legal framework currently in place.

Image caption: A rendition of NASA’s Space Launch System taking off (Credits: NASA).

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About the author

Giugi Carminati

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Giugi Carminati is a litigator in Houston, Texas. She practices commercial litigation, qui tam litigation, and white collar criminal defense at the trial boutique Berg & Androphy. She is also co-owner and co-manager of ADE Aerospace Consulting, LLC. Giugi has published numerous articles on commercial space and co-authored The Laws of Spaceflight: A Guidebook for New Space Lawyers. Giugi has an LLM in Space, Cyber & Telecommunications law from the University of Nebraska Law School. Finally, in 2012, Giugi published her first science fiction novel, Sparcus: Broken Worlds.