This is the fifth of a continuing series of historical fact sheets on the origins of NASA's X-33 program. The X-33 is a technology demonstrator for NASA's "next generation" of space launch vehicle. It will flight test a range of technologies needed for single-stage-to-orbit reusable launch vehicles, such as thermal protection systems, composite cryogenic fuel tanks, and the aerospike engine. Test flights are scheduled to begin in July 1999. Eventually, based on the X-33 experience shared with NASA, Lockheed Martin hopes to build a commercial single-stage-to-orbit reusable launch vehicle, called VentureStar. In the future, rather than operate space transport systems as it has with the Space Shuttle, NASA plans to purchase launch services from Lockheed Martin and other commercial launch providers.

The decision to design and build the X-33 grew out of a NASA study titled "Access to Space." The period preceding the "Access to Space" study is the subject of the first fact sheet, titled "The Policy Origins of the X-33." The second fact sheet deals with the specific chain of events that led to the creation of the "Access to Space" study, the conclusions of the so-called Option 3 team within the "Access to Space" study, and the role played by an experimental program run by the Strategic Defense Initiative Office (SDIO) of the Department of Defense. The third fact sheet relates the conclusions of the Option 1 and Option 2 teams, the emergence of a tentative NASA program to build an experimental advanced technology demonstrator flight vehicle, the X-2000, and public and Congressional support for a single-stage-to-orbit spaceship. The fourth fact sheet discusses the changing political and strategic climate between 1988 and 1993. This, the fifth fact sheet, considers the funding difficulties of the country's only single-stage-to-orbit vehicle program, the DC-X.

The search for "peace dividends" as the Cold War came to an end, as well as efforts to tackle the huge federal deficit, meant fewer and fewer defense dollars. This budgetary assault on spending continued throughout 1992, 1993, and 1994, when the SDIO's SSTO/SSRT (DC-X) Program came to a definitive end. A critical consequence of those budget cuts was open hostility among supporters of various launch systems. The hostility was voiced not just on the floor of the House and Senate, but in the press as well, in the form of invectives, denunciations, and ad hominem attacks.

While the Titan IV expendable launcher and the Centaur upper stage rocket came under Congressional scrutiny of their own, hostility toward the SDIO/SSRT Program came from the champions of the National AeroSpace Plane (NASP), an experimental reusable launcher jointly funded by the Pentagon and NASA, and the Advanced Launch System (renamed the New Launch System), a new generation of expendable launchers capable of lifting heavy payloads funded jointly by the SDIO (now BMDO), NASA, and the Department of Defense. Support for NASP waned over the course of 1992. NASA Administrator Daniel Goldin limited his agency's annual program contribution to $75 million, while the Pentagon set its NASP funding level at no more than twice that of NASA. That left the Advanced Launch System (ALS) as the primary source of hostility toward the SSTO/SSRT Program.

Countering the attacks on the SSTO/SSRT Program was the lobbying effort begun in 1989 in support of the SSX. By the fall of 1991, groups within the so-called space movement began to play a vital role as public advocates of the SSRT Program. Among the first organizations to support the program were High Frontier, the Citizens' Advisory Council on National Space Policy, the L-5 Society, and the Space Transportation Association. Later came the National Space Society (and its lobbying arm, SpaceCause), the Space Access Society, the Space Frontier Society, and the Aerospace States Association These organizations offered their newsletters, telephone trees, fax machines, manpower, and other resources in support of the ongoing Congressional struggle to fund the SSTO/SSRT Program.

While Bush and Quayle remained in office throughout 1992, the DC-X program continued to enjoy White House support. Within Congress, the strongest support came from those individuals whose constituencies were effected most by the SSTO/SSRT Program. From New Mexico, where the DC-X flight tests took place, came Senator Pete V. Domenici, a Republican and member of the powerful Appropriations Committee, who saw in the program the potential development of a spaceport in New Mexico and with it jobs. Strong political support in the House came from Representative Dana Rohrabacher, a Republican member of the House Science, Space, and Technology Committee. Rohrabacher was elected by voters from Orange County in Southern California, where a large portion of the aerospace industry was located. The climbing aerospace and defense unemployment in Southern California made the DC-X a bread-and-butter issue not only for Rohrabacher, but for everyone representing California in Congress.

The precarious nature of SSTO/SSRT funding was demonstrated as early as September 1991, when the fiscal 1992 Department of Defense authorization bill came under scrutiny by Congress. The program was to be cut from the SDIO budget. Luckily, Rep. Dana Rohrabacher and his staff were able to reinstate funding for fiscal 1992 and fiscal 1993, thereby providing the money necessary to complete construction of the DC-X.

The real problem was not White House or Congressional support, but persuading Pentagon bureaucrats. Secretary of Defense Richard Cheney favored the program. Nonetheless, the Pentagon cut $27 million from the DC-X in order to fund the National Launch System using a budgetary maneuver known as a Format I. A Format I notified a program or office within the Office of the Secretary of Defense (OSD) that the OSD intended to take money already allocated to that program or office and allocate it to another program or office within the OSD. In this case, OSD proposed to take $27 million from SDIO and reallocate the funds to the National Launch System (NLS) program that the Air Force and NASA were jointly pursuing.

The Format I was withdrawn, after the House and Senate conference on the defense appropriations bill agreed to provide $55 million for NLS out of the Air Force budget line, and reallocated the $27 million to the SDIO for the SSTO program. However, the Format I was reactivated in February 1992. In order to have the Pentagon reverse the Format I, Rohrabacher and other congressmen joined in a letter-writing campaign.

Nobody, however, could determine which Pentagon official had ordered the reactivation of the Format I in favor of the NLS. Finally, the source was identified. A relatively minor bureaucrat in the Pentagon's office of Offensive and Space Systems had decided on his own authority to reactivate the Format I, because in reading a memorandum from Deputy Defense Secretary Donald Atwood on how U.S. space launch strategy should evolve, he became concerned that the NLS was short of funds. The Format I was rescinded on March 29, 1992, and in April 1992, the DC-X funds were released to the SDIO.

The Format I episode epitomized the difficulties that the SSTO Program would face in 1992. The program would see a continuing struggle to retain funding for the second year of Phase II (the DC-X), and an even harder battle to fund Phase III (a larger-scale prototype). The funding difficulty was the same faced by all defense and space programs that year: a shrinking federal budget forced programs to fight among themselves for a slice of a smaller and smaller budgetary pie.

On top of this fierce funding battle, the SSTO Program faced the problem of finding a new institutional home. The shift in Strategic Defense Initiative architecture to GPALS under President Bush left the SSTO Program without a military mission. The program needed a new home. Which institution would it be? And would the SDIO SSTO team remain on the project, or be traded for an entirely new team?

The problem of finding a new home for the SSTO was inextricably linked to its mission. Who needed the SSTO? Pat Ladner, SSTO program manager, and other SSTO supporters, envisioned the operational SSTO vehicle as fulfilling Air Force, NASA, and commercial missions. In order for the SSTO, or any other launch system, to be funded, it had to have a mission geared to the needs of an existing institution, such as NASA or the Air Force. The SSTO had to find a new mission, in order to have a new institutional home (and funding).

Characterizing the SSTO vehicle as fulfilling military, civil, and commercial missions was not the answer, although it was the truth. Launch systems suitable for a variety of missions were no longer desirable. The United States had placed all NASA and Department of Defense payloads on the Space Shuttle, until the Challenger disaster showed the folly of that policy. As for the commercial launch potential of the SSTO, the country had a real need for a cheaper launcher. However, no institution for the development of commercial launchers existed, and no firm appeared ready to put up its own money, or the money of backers, to design and build the SSTO. Where, then, would the SSTO go after SDIO?

The Air Force was being demobilized and downsized. The Advanced Research Projects Administration (ARPA), was a logical possibility. It had a project management approach similar to that used by the SDIO. Was NASA a possibility? The emergence of the X-2000 proposal suggested it might.

The question of the SSRT Program's new home remained unresolved until 1993, as Congress prepared the fiscal 1994 budget. In July 1993, the House Armed Services Committee added a provision to the defense spending bill that moved the SSRT Program to ARPA and retained the existing management team. In September 1993, the House Armed Services Committee, with the passage of H.R. 2401, transferred the SSRT program, along with its management team, to ARPA. By Thanksgiving, the SSRT program office had begun discussions with ARPA, the Office of the Under Secretary of Defense for Acquisition, and the Air Force, to decide on the best organizational structure and processes for transferring the program to ARPA.

While the DC-X test flights ultimately received funding, the struggle to obtain appropriations for the Phase III vehicle were ongoing throughout 1992 and 1993. The Phase III vehicle was known variously as the Y-vehicle, the DC-X2, the DC-Y, and the SX-2. Moreover, these represented different vehicles to different people. The operational vehicle was still known as the DC-1. Phase III was to take place over about 33 months, and Y-vehicle development would cost about $450 million. The envisioned vehicle would use eight RL-10A-5 engines, stand 50 feet high, and test reentry procedures and aerodynamics to and from orbit. Program supporters were divided over whether to build a single orbital prototype (the DC-Y) or to carry out a slower paced program with several vehicles built, each of which would cost very little. However, the push for Phase III funding settled on paying for the SX-2.

The struggle to fund Phase III was a daunting task that ultimately failed. However, in April 1992, it still looked possible, especially if the November elections brought in new minds that could be convinced of the value of a single-stage-to-orbit vehicle program. Also, competition from other launcher projects was waning. The National AeroSpace Plane program was over, for all practical purposes, and the National Launch System was losing support.

Getting money authorized for a Phase III vehicle seemed to be easy enough in May 1992. The final language in the Committee Report of the House Armed Services Committee's Subcommittee on Research and Development authorized Phase III spending of $35 million. That, however, was an authorization, not an appropriation. The House Appropriations Committee Report on defense spending cancelled the SSTO Program. Phase III had no chance of finding a budget line.

Work on the DC-X continued into the fall of 1992, when Bill Clinton and Al Gore were elected to the White House. As the new President and Vice President were sworn in in January 1993, the SSRT Program acquired a new obstacle. Clinton and Gore would want to review current space policy and rewrite it to their liking. The Democrats had not been in a position to shape space policy from the White House since the Carter Administration when the Space Shuttle had not yet flown its first mission. But what would happen to existing programs until that policy was formulated?

Meanwhile, supporters of the SSRT Program continued to push for Phase III funding. Among those supporters were Sen. Pete Domenici and four other members of the New Mexico Congressional delegation, as well as lobbying groups and the space movement. Finding money for Phase III in fiscal 1994 was not going to be easy, because Congress was looking for places to cut the budget. In order to fund Phase III, funds would have to be taken from other programs. In September 1993, the House Armed Services Committee authorized $79.88 million in fiscal 1994 to begin development of the phase III vehicle, and the Senate passed the Domenici-Bingaman Amendment to the Pentagon Authorization Bill by a vote of 66 to 33, thereby providing funding for the SSRT program.

Although the DC-X began its test flights at this time, those flights were suspended because of a lack of funding. The project needed an additional $5 million to undertake from 5 to 15 more flights in October and November of 1993. This was not the only problem facing the program.

In October, 1993, the SSRT Program would suffer a deadly attack from Dr. Terry Dawson, a Congressional staffer with the House Science, Space, and Technology Committee and trained in engineering administration. Dawson held a meeting for the staffers of the committees on science, intelligence, armed services, and appropriations in the Russell Senate Office Building to review recent industry and NASA tours he and other staffers had taken and to discuss space launchers for fiscal 1994. The majority of those attending the meeting believed that a single-stage-to-orbit vehicle was a far-term prospect, at least fifteen years in the future, would require major technical advances, and would be extremely expensive, with the estimated cost of an operational vehicle about $15 billion. The failure of the NASP program to even approach realization of a single-stage-to-orbit design may have justified their belief. Dawson's meeting ended with an agreement to draft new legislation in which single-stage-to-orbit vehicles would not figure prominently. Ray Williamson of the Office of Technology Assessment, who had attended the meeting, said there was an "enormous gulf" between the DC-X and the technology needed for an operational vehicle.

The Dawson meeting had a devastating effect on Phase III SSRT funding. A few days later, House appropriators cut the ARPA space budget in half. The SSRT Program received $40 million, about half of the $75 million recommended by in the authorization bill. Bob Dornan, Dana Rohrabacher, and others tried to restore funding in the Senate appropriations bill, at least at the $40 million level approved by the House.

They succeeded, somewhat. Congress proposed to give to ARPA $17 million in fiscal 1994 for the SSRT Program. About $5 million could be used to complete the DC-X test flights, and the balance would fund the start of Phase III. However, the final version of the appropriations bill gave the SSRT Program $50 million, but nothing to continue the DC-X test flights. When the Defense Appropriations bill went to the White House for signature on November 10, 1993, ARPA was to receive $50 million for the SSRT Program, of which $5.1 million was earmarked for finishing the DC-X flight tests.

Despite the enactment of this legislation into law, the $5 million intended for the DC-X test flights still had not been released as January 1994 was coming to a close. What had happened in the meantime was a recision, a reduction of program funds proposed by the Executive Branch to the Congress.

On December 31, 1993, the Comptroller of the Department of Defense submitted recision proposals amounting to $314.7 million for several programs, including $50 million from the "ARPA space program," that is, the SSRT Program. The battle over the recision lasted through most of January 1994, and saw Rep. Newt Gingrich, then House Minority Whip, joining the fight to save the SSRT Program and the DC-X test flights.

On top of the recision, Pentagon Comptroller John Hamre rejected the amount appropriated by Congress to ARPA for the SSRT and would only allow $10 million. The SSRT Program would have to cancel the DC-X contract on February 1, 1994, unless the ARPA funds were released. They were not. Instead, on January 31, 1994, NASA's Administrator Daniel Goldin released $900,000 in NASA funding to keep the DC-X at the White Sands Missile Range and to defray the Clipper Site overhead charges until the ARPA funds could be released. Not until late in April, however, did the Pentagon finally release $5.1 million from ARPA to BMDO to continue DC-X testing. About $3.5 million went to McDonnell Douglas, while the rest covered range expenses at White Sands Missile Range.

The DC-X flew again on June 20, 1994. This was its longest flight (136 seconds) and highest (870 meters) flight to date. The vehicle flew again a week later, and demonstrated its ability to land under total control of internal programming. A ground equipment explosion caused a shock wave that ripped a 4-by-15-foot hole in the DC-X aeroshell. Pete Conrad, watching his computer screen in the Flight Control Center, heard an abort request from his two colleagues and activated the software command for "autoland." The DC-X safely returned to the ground.

McDonnell Douglas and BMDO later determined that gaseous oxygen, gaseous hydrogen, and water vapor were drawn into the air purge duct of nearby ground equipment, instead of being blown away. Half the $5.1 million was gone. The DC-X's hydrogen tank had a two-inch crack. A new aeroshell would cost $700,000. The SSRT Program did not have enough money to make repairs and fly again. Indeed, the damaged DC-X would not fly again until May 16, 1995.

Although funding for the DC-X test flights had been rescued, Phase III of the program was still in doubt. The question of funding Phase III, moreover, would not be settled in Congress but by the Executive Branch. The recently elected Clinton Administration still had not yet settled on a space policy. In November 1993, the White House asked congressional staff members to keep the major launch system programs alive until the Administration had decided how to proceed.

Elected into office twelve months earlier, the Clinton-Gore team only had advanced that far in formulating a space policy. Clearly, the new administration did not put space on as high a priority level as had the Reagan Administration. Nonetheless, the White House let it be known that it had ruled out development of a big new rocket "for the foreseeable future." Subsequently, the White House Office of Science and Technology Policy (OSTP) held the first meeting of an interagency working group to decide what the Clinton Administration launch policy would be.

While White House launcher policy remained unsettled, the Pentagon undertook its own study of defense launch needs, known as the Space Launch Modernization Study, after completion of an internal so-called bottom-up review that killed all development of new space transport systems. The Fiscal 1994 Defense Authorization Act had directed the Secretary of Defense to develop a plan to establish priorities, goals, and milestones for the modernization of space launch capabilities. Lt. Gen. Thomas S. Moorman, Jr., Vice Commander of Air Force Space Command, led the Space Launch Modernization Plan study, which was to be delivered to Congress on April 1, 1994. As a result, the defense agency was reluctant to begin a program without a plan to continue it in the years to come, and therefore did not wish to proceed with SSRT Phase III until after the study was completed.

The Moorman Report, officially titled the "Department of Defense Space Launch Modernization Plan," however, was not delivered until May 1994. Its release facilitated transfer of ARPA funds to BMDO for resumption of the DC-X test flights. The Moorman Report presented four launch system options, one of which was a reusable rocket. Based on the recommendations of the Moorman Report, in May 1994, the OSTP designated NASA as the lead agency for reusable launch systems, and the Department of Defense as the lead agency for expendable launch systems.

The OSTP decision angered supporters of the SSRT Program. NASA was not one of their favorite agencies, and was certainly not high on their list of agencies to provide the program a new institutional home. Rep. Rohrabacher protested the OSTP policy in a letter to Vice President Al Gore dated May 17, 1994, and gave his reasons for not assigning SSRT to NASA. NASA, he alleged, had never been the lead agency on an X-vehicle program; it had always played a secondary role, such as with the X-29, the X-31, the X-15, and the X-1. The space agency also was "preoccupied" with the Space Station and other considerable missions. Finally, NASA lacked the money to sustain the program, nor was it likely to have the money in the future, Rohrabacher argued, while the Pentagon would "at least have some dollars available for such allocation."

The struggle to fund Phase III SSRT continued, despite the announced OSTP policy. In July 1994, for example, defense appropriators in the House voted to award $50 million to SSRT for fiscal 1995, but only if NASA was not selected by the White House to run the SSRT Program. Subsequently, in August 1994, defense authorizers in the House and Senate agreed to spend $30 million for the SSRT Program. The Pentagon, however, was not going to spend the money allocated by Congress. Moreover, in October 1994, ARPA director Gary Denman announced that his agency would no longer be conducting space research and development.

The development of a reusable single-stage-to-orbit prototype vehicle, however, was to take place at NASA, not the Department of Defense. The DC-X, moreover, was transferred to NASA. In June 1994, NASA and the Department of Defense announced that each agency would contribute $1 million to transfer the DC-X to NASA, and that when NASA took over the program in fiscal 1995, it would spend $13 million in fiscal 1995 and $16 million in fiscal 1996 to fly the DC-X in technology demonstration flights.

The space agency converted the vehicle from an operations demonstrator to a technology demonstrator, which was one step closer to designing and building a full-scale single-stage-to-orbit prototype. The NASA program, under Jack Mansfield, who was then head of the Office of Space Access and Technology, would attempt to emulate the management success BMDO had with the DC-X, and sought to hire Col. Gary Payton, the initial SSRT Program manager, and others to manage the DC-X single-stage-to-orbit program. Thus, by October 1994, the DC-X had funding, and the SSRT Program, depending on one's point of view, was either dead or reborn as a NASA project.