TRANSFER OF THE CIVIL SPACE REMOTE SENSING SYSTEMS TO THE PRIVATE SECTOR

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP85M00158R000800110031-0
• Release Decision: RIFPUB
• Original Classification: K
• Document Page Count: 6
• Document Creation Date: December 22, 2016
• Document Release Date: February 5, 2010
• Sequence Number: 31
• Publication Date: February 24, 1983
• Content Type: MEMO

Approved For Release 2010/02/05: CIA-RDP85M00158R000800110031-0
CABINIr AFFAIRS STAFFING MEMORANDUM
t/
2/25/83
DATE: 2-24-83
NUMBER: 118520CA DUE BY: 5000 j
SUBJECT: Transfer of the Civil Space Remote Sensing Systems to the
Private Sector.
ACTION FYI
ALL CABINET MEMBERS le" ^
Vice President ^ ^
State ^ ^
Treasury ^ ^
Defense ^ ^
Attorney General ^ ^
Interior ^ ^
Agriculture ^ ^
Commerce ^ ^
Labor ^ ^
HHS ^ ^
HUD ^ ^
Transportation ^ ^
Energy ^ ^
Education ^ . ^
Counsellor ^ ^
,,,OMB
C, ^ ^
UN
USTR ^ ^
^ O
CEA [5, ^
CE ^ ^
OSTP
13 ^
NASA I' ^
^ ^
CCEA/Porter ^
CCFA/Boggs ^
CCHR/Carleson ^
CCLP/Uhlmann ^
CCMA/Bledsoe 0
CCNREBoggs ^
REMARKS: Please review and provide comments. on the attached decision
memorandum by 5:00 p.m., Friday, February 25, 1983.
RETURN TO: ^ Craig L. Fuller
Assistant to the President
for Cabinet Affairs
456-2823
ACTION FYI
Deaver ^ ^
Clark ill" ^
Darman (For WH Staffing) 2-" ^
Harper ^ ^
Jenkins ^ 0
^ ^
D ^
^ ^
^ ^
^ ^
^ ^
^ ^
Baker
CCCT/Gunn ^ G!r-
l' Beckp Norton Dunlop
Director, Office of
Cabinet Affairs
456-2800
0
0
^
0
Approved For Release 2010/02/05: CIA-RDP85M00158R000800110031-0
 Approved For Release 2010/02/05: CIA-RDP85M00158R000800110031-0
SUBJECT: Transfer of the Civil Space Remote Sensing Systems
to the Private Sector
Should the Administration transfer to the private sector the
civil operational land and weather satellite systems?
Background
The current U.S. program in operational civil space remote
sensing consists of a single land satellite and'four operational
weather satellites in orbit. Civil ocean obseri.ng satellites
have demonstrated their utility also, although there are no
operational systems currently in place. A number of private
entities have expressed interest in assuming responsibility for
portions of the civil space remote sensing system. Some firms
are interested in the land satellite systems; another is
interested in both the land and weather satellite systems.
Foreign governments have recognized the value of this technology.
Civil space remote sensing systems are being advanced by France,
Japan, the European Space Agency, India, Canada, the Federal
Republic of Germany, and the Soviet Union. To date, only France
has actually invested in a land remote sensing system (SPOT);
others have invested only in weather systems.
All agencies believe that self-supporting, successful private
ventures could evolve in the land and weather sensing markets.
However, the time required for this process, as well as the
potential size and characteristics of the market, once evolved,
are uncertain. The Government provides a steady market for
weather data. The value of land satellite data to the U.S.
Government has not been rigorously established. Federal user
agencies have been happy to use data now provided at subsidized
costs, but, if required to pay the full cost of land satellite
data, they indicate an intention to consider other means to meet
their needs. Therefore, to avoid discriminating against
economically desirable alternatives, the Federal Government
should allow agencies to choose the most cost-effective means of
obtaining data.
Approved For Release 2010/02/05: CIA-RDP85M00158R000800110031-0
 Approved For Release 2010/02/05: CIA-RDP85M00158R000800110031-0
Other than Federal users, the land satellite data market has not
grown as rapidly as it could have because of the inherent
limitations on the Government in developing domestic and
international markets. The market for land remote sensing data
will have to be further developed. If given the opportunity, an
aggressive private sector operation could expand the market base
for this product.
The U.S. Government is currently spending more than $14 billion
per year on the civil and national defense space programs, of
which nominally $150-$200 million is devoted to civil space
remote sensing. The Administration's current budget includes
funding for the long term operation and replacement of the civil
weather satellite. For land remote sensing, the current policy
is to continue with the two land satellites which were purchased
prior to this Administration and are expected to last until 1988.
Thus, the budget has only operating costs and does not include
additional Federal funding to procure additional land satellites.
The budget assumes that any future land remote sensing systems
would have to be developed, launched, and operated by a private
entity. Current budget projections do not include funding for
development and implementation of expanded uses'of data generated
by land satellite programs.
The United States has created this high-technology field, but it
could lose its leadership position in land remote sensing unless
action is taken to preserve it. It should be noted, though, that
NASA and DOD are heavily committed to R&D in this field. Also,
some private U.S. firms have expressed strong interest in
entering the field. Any action taken to transfer civil space
remote sensing to the private sector should in no way preclude
the continuation of R&D in NASA and DOD to advance remote sensing
technology.
Transfer to a private entity without any government assurances
would be preferable and will be actively sought. However,
implementing a commercial satellite system may involve some form
of Government-assured market for a time, e.g., a guaranteed
minimum purchase agreement, until the private entity is firmly
established. The level of need for such support, if any, will be
considered carefully in the evaluation of proposals actually
submitted. Such support could raise future budget outlays by ass
much as $150 million per year, in 1983 dollars, above current
budget projections.
Federal interests will require a continuing oversight to any
private entity involved in civil space remote sensing, as
outlined by existing international law, national law and current
Approved For Release 2010/02/05: CIA-RDP85M00158R000800110031-0
 Approved For Release 2010/02/05: CIA-RDP85M00158R000800110031-0
- 3 -
national space policy. Such oversight, carried out with
interagency coordination and contractual provisions between the
Government and the data supplier, will assure that national
defense, intelligence, and foreign relations concerns are
satisfied.
The Cabinet Council on Commerce and Trade has extensively
reviewed the issue and has identified two principal options for
your consideration:
Option 1: Transfer to the private sector, by competitive
means, the current operational civil remote sensing satellites.
Separate bids would be accepted for the land or weather
satellites, or a firm could elect to submit a single bid for all
systems, any mix thereof, or any part of a single systems.
The Department of Commerce will oversee the transfer of the civil
operational remote sensing satellites to the U.S. private sector
as soon as possible. The selection of the private entity would
occur under conditions of competition among U.S. firms only. The
transfer will be guided by the following principles:
(1) National security and foreign policy concerns must be
appropriately addressed in preparing legislation,
requesting.proposals, and overseeing the private entity
or entities.
(2) The selection of the private entity would occur under
competitive conditions. Private firms would have the
option of bidding separately for the land or weather
satellite system or preparing a joint submission for
both. The financial and program justifications would
be presented in such-a manner that separate submissions
can be appropriately compared to joint submissions.
(3) The Department of Commerce would establish an
inter-agency coordinating body as soon as possible.
The results of the competitive bidding will be evaluated and,
should that evaluation determine that it would be in the best
interest of the USG to effect the transfer, we will make a final
recommendation for your consideration.
Advantages
o Stimulates technology development by the private sector
in response to new market demands and expands the role of
private industry.
Approved For Release 2010/02/05: CIA-RDP85M00158R000800110031-0
 Approved For Release 2010/02/05: CIA-RDP85M00158R000800110031-0
o Demonstrates commitment to the private sector role in
space.
o Reduces the size and scope of Government activities.
o Increases the probability that information flows from
land satellites will continue.
Disadvantages
o May require maintaining Federal funding to cover minimum
purchase commitments by the Government, until the private
entity is firmly established.
o There is a possibility that a new regulatory structure
would be required.
Option 2: Continue the current budget policy of bringing the
operational land remote sensin systems in the Government to a
close nominally by 1988 or sooner if private industry is willing
to take it over) and retain the civil weather satellites under
Government control.
Advantage
o Option is within current budget.
Disadvantages
o Only minimally reduces the size and scope of Government.
o May result in the relinquishment of land remote
sensing to foreign competitors by U.S..
Option 1 Transfer to the private sector, via competitive
means the current operational civil weather and
land satellites. Separate bids would be
permitted for the land or weather satellites,
or a firm could elect to submit a single bid
for all.
Option 1 unanimously supported by the Cabinet
Council on Commerce and Trade
Approved For Release 2010/02/05: CIA-RDP85M00158R000800110031-0
 Approved For Release 2010/02/05: CIA-RDP85M00158R000800110031-0
Option 2
Continue the current budget policy of bringing
the operational land remote sensing systems in
the Government to a close nominally by 1988 or
sooner if private industry is willing to take
it over, and retain the civil weather
satellites under Government control.
Malcolm Baldrige
Chairman Pro Tempore
Cabinet Council on Commerce and Trade
Approved For Release 2010/02/05: CIA-RDP85M00158R000800110031-0