STATEMENT OF WILLIAM P. BISHOP CHAIRMAN, SOURCE EVALUATION BOARD FOR CIVIL SPACE REMOTE SENSING BEFORE THE COMMITTEE ON COMMERCE, SCIENCE AND TRANSPORTATION UNITED STATES SENATE

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP05T02051R000200280010-8
• Release Decision: RIFPUB
• Original Classification: K
• Document Page Count: 9
• Document Creation Date: December 22, 2016
• Document Release Date: August 5, 2011
• Sequence Number: 10
• Publication Date: March 22, 1984
• Content Type: MISC

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STATEMENT OF
WILLIAM P. BISHOP
CHAIRMAN, SOURCE EVALUATION BOARD
FOR CIVIL SPACE REMOTE SENSING
BEFORE THE
COMMITTEE ON COMMERCE, SCIENCE AND TRANSPORTATION
UNITED STATES SENATE
MARCH 22, 1984
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MR. CHAIRMAN AND MEMBERS OF THE COMMITTEE:
MY NAME IS WILLIAM P. BISHOP. I AM THE CHAIRMAN OF THE
DEPARTMENT OF COMMERCE'S SOURCE EVALUATION BOARD FOR CIVIL SPACE
REMOTE SENSING (THE "SEB"). I AM PLEASED TO BE HERE TODAY TO
TESTIFY ON BEHALF OF THE ADMINISTRATION CONCERNING S.1855,
S.1861, AND S.2292, TITLED LAND REMOTE SENSING SATELLITE
AUTHORIZATION ACTS OF 1983 OR 1984. I DO NOT INTEND TO DWELL ON
THE ACTIVITIES OF THE SEB DURING THE PAST SEVERAL MONTHS EXCEPT
TO SAY THAT THE RFP FOR COMMERCIALIZATION OF LAND REMOTE SENSING
WAS RELEASED ON JANUARY 3RD 1984, AND RESPONSES WERE RECEIVED
ON MARCH 19TH, 1984.
MR. CHAIRMAN, I WOULD LIKE TO PUT ONE POINT CLEARLY ON THE RECORD
AT THE OUTSET. IN ORDER TO BE ABLE TO TESTIFY AT THESE HEARINGS
AND ANSWER QUESTIONS WHICH YOU MAY ASK, I HAVE DELIBERATLY NOT
READ ANY OF THE RESPONSES WHICH WERE RECEIVED BY THE SEB NOR
DISCUSSED THEM WITH THE OTHER BOARD MEMBERS. I DO NOT KNOW WHAT
THOSE BIDS CONTAIN, AND WILL NOT KNOW UNTIL TOMORROW WHEN I FIRST
SEE THEM. THEREFORE, MY DISCUSSION WITH YOU TODAY WILL BE BASED
ON INFORMATION DEVELOPED BY THE SEB AND THE LARGER INTERAGENCY
TEAM AND ARE IN NO WAY INFLUENCED BY THE CONTENTS OF THE
PROPOSALS.
I WOULD LIKE TO THANK THIS COMMITTEE AND THE MEMBERS WHO HAVE
INTRODUCED THE THREE BILLS FOR THEIR LEADERSHIP REGARDING THIS
ISSUE. THESE BILLS HAVE DEVELOPED THE BASIS FOR A PRACTICAL
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APPROACH TO COMMERCIALIZATION. WE HAVE ESPECIALLY APPRECIATED
THE OPPORTUNITY TO WORK CLOSELY WITH YOUR STAFFS ON THIS MATTER,
AND WE BELIEVE THAT A SOLID START HAS BEEN MADE.
IT IS THE DESIRE OF THE ADMINISTRATION TO ACHIEVE
COMMERCIALIZATION OF CIVIL LAND REMOTE SENSING FROM SPACE AS SOON
AS POSSIBLE WHILE MAINTAINING THE U.S. LEAD IN LAND REMOTE
SENSING AND WHILE HAVING THE PRIVATE SECTOR MAKE MAJOR
INVESTMENTS.
THESE BILLS, WITH SOME TECHNICAL CHANGES WHICH I WILL DISCUSS
BELOW, ARE AN APPROPRIATE FRAMEWORK FOR DISCUSSION OF HOW THESE
GOALS MAY BE ACHIEVED. OUR COMMENTS ON THESE BILLS REFLECT IN
LARGE PART THE EXPERIENCE OF THE ADMINISTRATION IN CONDUCTING THE
RFP PROCESS OVER THE LAST NINE MONTHS. ONE OF THE LESSONS WE
HAVE LEARNED IN THIS PROCESS IS WE DON'T WANT TO HAVE TO DO IT
AGAIN; AT LEAST NOT IN THE NEAR FUTURE. IT IS THEREFORE, OF
EXTREME IMPORTANCE THAT LEGISLATION ENACTED BY BOTH HOUSES OF
CONGRESS AND THE RFP PREPARED BY THE SEB BE CONSISTENT ON
SUBSTANTIVE ISSUES. WITH SOME MINOR EXCEPTIONS, I BELIEVE THEY
ARE CONSISTENT.
THE PROCUREMENT PROCESS NOW UNDERWAY CONSTITUTES WHAT WE BELIEVE
TO BE THE MOST THOROUGH AND EXHAUSTIVE EFFORT TO DATE TO
DETERMINE THE NEXT STEPS IN THE PROGRAM TO FACILITATE THE
TRANSFER OF LAND REMOTE SENSING OPERATIONS TO THE PRIVATE
SECTOR. IT HAS BEEN AN UNUSUALLY COMPLICATED AND TIME CONSUMING
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ACTION, AND IT IS MY ESTIMATE THAT AT LEAST TWO MONTHS WILL BE
REQUIRED FOR THE SEB TO SUBMIT ITS ANALYSIS AND RECOMMENDATIONS
TO SECRETARY BALDRIGE. A NUMBER OF FIRMS SPENT CONSIDERABLE TIME
AND CORPORATE FUNDS PREPARING THE RESPONSES TO THE RFP. IN OUR
VIEW IT WOULD BE EXTREMELY UNFORTUNATE IF THE WORK OF THE SEB AND
THESE PRIVATE FIRMS WERE TO BE DISCARDED OR REPEATED. IT WOULD
CERTAINLY RESULT IN SIGNIFICANT AND COSTLY DELAYS IN THE
COMMERCIALIZATION PROCESS. I AM VERY PLEASED, THEREFORE, THAT WE
ONLY HAVE MINOR CHANGES TO SUGGEST IN OTHERWISE EXCELLENT PIECES
OF PROPOSED LEGISLATION.
IT IS OUR OPINION THAT S.1855 AND S.1861 CONTAIN ESSENTIALLY THE
SAME PROVISIONS AS THOSE CONTAINED IN S.2292. S.2292 BEING NFORE
EXTENSIVE AND HAVING BEEN INTRODUCED LATER, REPRESENTS THE MOST
COMPLETE PIECE OF LEGISLATION. THUS, IT IS THE ONE WHICH I WILL
SPECIFICALLY DISCUSS TODAY.
IN ADDITION TO THESE COMMENTS, WE ARE PREPARED TO DELIVER TO YOUR
STAFF TECHNICAL COMMENTS AS WELL AS SPECIFIC AMENDMENT LANGUAGE
FOR YOUR CONSIDERATION, WHICH WILL IMPLEMENT THE SUGGESTIONS IN
MY REMARKS HERE.
SCOPE OF THE BILL:
FIRST A WORD CONCERNING THE SCOPE OF THE BILL. THE SHORT TITLE
AND FINDINGS REFER TO LAND REMOTE SENSING, WHILE THE OPERATIVE
PORTIONS OF THE BILL APPARENTLY REFER TO BOTH LAND AND OCEAN
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REMOTE SENSING. THERE IS NO GENERALLY RECOGNIZED OPERATIONAL
CAPABILITY IN OCEAN REMOTE SENSING AT THE PRESENT TIME.
INCLUDING OCEAN SENSING WITHIN THE SCOPE OF THE BILL WILL HAVE
THE EFFECT OF SPECIFYING THE GOVERNMENT'S CONDITIONS FOR THE
COMMERCIALIZATION OF OCEAN SENSING LONG BEFORE THE PARAMETERS OF
SUCH A SYSTEM OR THE NEED FOR COMMERCIALIZATION HAVE BEEN
ESTABLISHED. THIS MAY HAVE THE EFFECT OF INHIBITING INNOVATIONS
IN THIS AREA. IT IS THE ADMINISTRATION'S VIEW THAT THE
BILLS'APPLICATION SHOULD THEREFORE BE LIMITED TO LAND REMOTE
SENSING.
COMPATIBILITY WITH THE RFP AND SUBMITTED BIDS:
ONE OF OUR PRINCIPAL CONCERNS, AS I INDICATED ABOVE, IS THAT THE
LEGISLATIONS DO NOTHING THAT WOULD CAUSE US TO BEGIN AGAIN OR
SERIOUSLY DELAY THE PROCESS. SEVERAL OF THE PROVISIONS IN THESE
BILLS ARE MORE RESTRICTIVE THAN THE PROVISIONS IN THE RFP. I
ASSUME THE RESPONDENTS ADDRESSED THEMSELVES TO THE PROVISIONS OF
THE RFP. IT IS OUR INTENT IN MAKING THESE SUGGESTIONS TO SEEK TO
MODIFY THE LEGISLATION TO THE POINT THAT IT IS CONSISTENT WITH
THE REQUIREMENTS OF THE RFP. IN SO DOING, WE HAVE TRIED TO BE
SENSITIVE TO THE INTENT OF THE LEGISLATION.
SECTION 201, DEALING WITH THE OPERATION AND DATA MARKETING OF THE
EXISTING LANDSAT 4 AND LANDSAT 5 SYSTEMS SPECIFIES THAT THE
UNITED STATES GOVERNMENT, SPECIFICALLY THE NATIONAL OCEANIC AND
ATMOSPHERIC ADMINISTRATION (NOAA), SHALL CONTINUE OWNERSHIP OF
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THE SYSTEM AND THE UNENHANCED DATA AND HAVE DECISION AUTHORITY
OVER OPERATION. HOWEVER, A CONTRACT WINNER IS ENTITLED TO SET
THE PRICES OF AND IN GENERAL MARKET THIS UNENHANCED DATA AS HE OR
SHE WISHES. THIS SEEMS TO INTRODUCE SEVERAL CONFLICTS. THE
CONTRACT WINNER IS AUTHORIZED AND ABLE TO MARKET DATA WHICH IS IN
THE OWNERSHIP OF THE UNITED STATES GOVERNMENT. WE BELIEVE THAT
RETENTION BY THE GOVERNMENT OF TITLE TO THE DATA WOULD REQUIRE
PROVISIONS IN THE BILL PERMITTING THE GOVERNMENT TO COPYRIGHT THE
DATA AND LICENSES REPRODUCTION AND SALES BY THE CONTRACTOR. THE
RFP AVOIDS THIS REQUIREMENT BY PERMITTING TRANSFER OF TITLE AS
WELL AS ASSETS OF THE LANDSAT SYSTEM TO THE PRIVATE SECTOR
OPERATOR, IF THIS IS DETERMINED TO BE IN THE NATIONAL INTEREST.
THUS, THE CONTRACTOR OBTAINS TITLE TO THE DATA, IS FREE TO MARKET
IT AND IS NOT SUBJECTED TO A COMPLICATION OF THE GOVERNMENT STILL
OWNING THE DATA. WE BELIEVE THE BEST WAY TO DEVELOP THE MARKET
IS TO LET THE MARKETPLACE DRIVE THE OPERATION AND THUS WE
RECOMMEND AN APPROACH IN THE LEGISLATION, SIMILAR TO THAT IN THE
RFP. ALSO, SECTION 201(c) SPECIFIES THAT NOAA WILL CONTINUE NOT
ONLY OWNERSHIP OF THE DATA BUT OWNERSHIP OF THE SYSTEM AND THE
AUTHORITY FOR OPERATIONAL DECISION. THE RFP ALLOWS THE
POSSIIBILITY FOR A CONTRACTOR TO TAKE OVER BOTH OWNERSHIP AND
OPERATION OF THE LANDSAT 4/5 SYSTEM. WE RECOMMEND THAT THE
BIDDERS BE ALLOWED THE OPPORTUNITY. THE TRANSFER WOULD REPRESENT
THE FIRST STEP IN A TRANSITION TO A MARKET DRIVEN SYSTEM.
SECTION 202(a) REQUIRES THAT THE "SECRETARY SHALL" CONTRACT FOR
THE MARKETING OF DATA. ALTHOUGH WE FEEL THAT BIDDERS SHOULD HAVE
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THE OPTION, WE ARE CONCERNED THAT IF NONE ELECT TO MARKET LANDSAT
4/5 DATA, THEN ANOTHER RFP WILL BE REQUIRED. WE SUGGEST THAT
"SHALL" BE CHANGED TO "MAY."
SECTION 202(c)(1) SPECIFIES A VERY EXTENSIVE CONGRESSIONAL REVIEW
AND APPROVAL PROCESS, WHICH GOES CONSIDERABLY BEYOND THE
REQUIREMENTS OF THE "BATEMAN AMENDMENT." IT IS OUR FEELING THAT
PASSAGE OF THIS LEGISLATION BY THE CONGRESS, WITHOUT THIS
SECTION, WOULD REPRESENT APPROVAL OF THE COMMERCIALIZATION
PROCESS. FURTHER SPECIFIC APPROVAL OF THE CONTRACT BY CONGRESS
IS INAPPROPRIATE. CONGRESS SHOULD SET THE POLICY FOR A TRANSFER;
THE SECRETARY OF COMMERCE SHOULD IMPLEMENT THE POLICY AS THE
SELECTION OFFICIAL FOR THE CONTRACT. WE STRONGLY REQUEST REMOVAL
OF 202(c)(1).
WE RECOMMEND THAT THE CLAUSE "AND OTHER FACTORS THAT THE
SECRETARY OF COMMERCE DEEMS NECESSARY" BE ADDED AS SECTION
203(3), TO BE CONSISTENT WITH THE RFP. THIS ADDITION PERMITS THE
INCLUSION OF OTHER FACTORS IN THE ENTIRE EVALUATION PROCESS.
SECTION 303(a)(5) REQUIRES AN EVALUATION INCLUDING "PERCENTAGE
OF DATA SALES" TO THE FEDERAAL GOVERNMENT. WE ALLOW THIS AS A
BID OPTION BUT FEEL THE FINANCIAL PLAN SHOULD BE FLEXIBLE. THUS
WE RECOMMEND THE CHANGE OF THE SUBSECTION TO PERMIT OTHER TYPES
OF REPAYMENT OF THE FEDERAL INVESTMENT.
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SECTION 303(b)(1) SPECIFIES THE SAME CONGRESSIONAL REVIEW OF A
CONTRACT DECISION AS I DISCUSSED IN SECTION 202(c)(1). WE ARE
OPPOSED TO THIS SUBSECTION FOR THE SAME REASON.
SECTION 305.3 DEALING WITH SALE OF DATA FROM THE FOLLOW-ON
COMMERCIAL SATELLITE SYSTEM STIPULATES THAT THE CONTRACT FOR THAT
ACTIVITY SHALL NOT PROVIDE A GUARANTEE OF PURCHASE OF DATA BY THE
FEDERAL GOVERNMENT FROM THE CONTRACTOR. THE RFP HAS MADE IT
CLEAR THAT THE GOVERNMENT WILL NOT ENTER INTO AN EXCLUSIVE DATA
PURCHASE ARRANGEMENT, BUT WE HAVE ALSO MADE IT CLEAR THAT THE
GOVERNMENT WOULD NOT NECESSARILY AGREE TO A PROPOSAL REQUIRING
GUARANTEED PURCHASE. HOWEVER, WE FEEL THAT FLEXIBILITY IS TO THE
GOVERNMENT'S ADVANTAGE IN THIS CASE, AND WE FEEL THAT THIS
RESTRICTION IS NOT IN THE BEST INTEREST OF THE GOVERNMENT. A
FINANCIAL ARRANGEMENT OF SUPPORT TO THE CONTRACTOR WHICH INCLUDES
SOME DEGREE OR TYPE OF GUARANTEED DATA PURCHASE MIGHT BE OF
INTEREST BOTH TO THE PROPOSER AND TO THE U.S. GOVERNMENT. WE
RECOMMEND THE LESS RESTRICTIVE APPROACH.
SECTION 303.A DESCRIBES A CONTRACT WHICH WILL EXTEND FOR A PERIOD
OF SIX YEARS AND SECTION 307 SPECIFIES A TERMINATION OF AUTHORITY
TEN YEARS AFTER THE DATE OF THE BEGINNING OF A CONTRACT ENTERED
INTO UNDER THE PREVISIONS OF THIS TITLE. THERE SEEMS TO BE SOME
UNCERTAINTY OF THE INTENDED TIME SPAN, EITHER 6 YEARS OR 10
YEARS. WE FEEL THAT A PERIOD OF TIME LONGER THAN 6 YEARS, MORE
LIKELY AT LEAST 8 YEARS, WILL BE NECESSARY FOR A CONTRACTOR TO
REACH THE STATE OF FULL FINANCIAL VIABILITY. THEREFORE, WE ARE
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PLEASED WITH THE TERMINATION OF AUTHORITY AT A TIME EXTENDING AS
LONG AS TEN YEARS, BUT WE WONDER IF THESE TWO TIMES SPECIFIED IN
THE LEGISLATION WOULD LEAD TO SOME DEGREE OF CONFUSION IN THE
AWARDING OF THE CONTRACT. WE PREFER THE LONGER AUTHORITY.
IN ORDER TO PERMIT FINANCIAL FLEXIBILITY ON THE PART OF A BIDDER,
AND TO ELIMINATE A PROCESS WHICH MIGHT JUST TAKE FUNDS FROM ONE
FEDERAL AGENCY POCKET AND TRANSFER IT TO ANOTHER, WE RECOMMEND
THAT THE PHRASE "SUCH AS LAUNCH SERVICES" BE REMOVED FROM SECTION
604.
MR. CHAIRMAN, LET ME CONCLUDE MY PREPARED STATEMENT BY
REITERATING WHAT I STATED AT THE OUTSET, THAT THESE THREE BILLS
AND IN PARTICULAR THE MORE DETAILED ONE, S2292, CONSTITUTE A
MAJOR STEP FORWARD TOWARD ESTABLISHING THE LEGAL FRAMEWORK FOR A
UNITED STATES COMMERCIAL OPERATION LAND REMOTE SENSING SYSTEM.
WE LOOK FORWARD TO THE PASSAGE OF THIS LEGISLATION BY THE SENATE,
SIMILAR LEGISLATION IN THE HOUSE AND THE INITIATION OF THE
PROCESS LEADING TO COMMERCIALIZATION OF LAND REMOTE SENSING.
I WOULD BE VERY HAPPY TO ANSWER YOUR QUESTIONS AT THIS TIME,
PLEASE BEAR IN MIND THAT I HAVE NOT READ ANY OF THE PROPOSALS AS
SUBMITTED, AND THEREFORE WOULD NOT BE ABLE TO ANSWER ANY
QUESTIONS DEALING WITH THE DETAILS OF THOSE PROPOSALS.
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