Safety & Health Considerations in Accommodating Commercial

Activties

David Loyd, JSC Safety & Test Operations

2013 NASA Safety Directors & Occupational Health Managers

MeetingMarch 28, 2013

Page No. 2

Commercial Considerations

Keys to Safe Commercial Operations at NASA Centers• Center leadership must commit to reduce risks to the NASA personnel,

assets, or the public to the greatest extent practical. • SMA must be flexible in how NASA’s specific requirements are applied.• Determine the nature of work that can be accommodated safely in a

given facility.• Avoid circumstances that would allow two organizations working side-

by-side to work to different sets of safety standards.• Respect the commercial customer need to reduce the operational

uncertainties as much as possible.• Regulatory compliance should be a minimum, but NASA most likely

will not be responsible for enforcement.• Get involved early in accommodating commercial activities.• Understand the unique industry language and practices.• Be open to different risk management methodologies.• Look to promote intent of requirements over format or delivery.

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Commercial Considerations

A Model for Encouraging Commercial Products, Services & Markets

SPACE ACT AGREEMENTS

GRANTS CONTRACTS

Product Maturity

• NASA supports research into new products and services

• NASA actively shares in operational development of new products and services

• NASA purchases commercial products and services as partof mature market

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Commercial Considerations

SMA Requirements Specific to Buying Commercial

For Grants• NPR 8715.3 requires identification of special safety conditions,

applicable OSHA requirements, and practices to be followed to control risks

• Safety provision is applied to performance involving NASA facilities, Government-Furnished Equipment, or hazardous or energetic materialsor chemicals used that may pose a significant safety or health risk to the public, NASA employees, and contractor employees

• In addition, 14 CFR 1260.37 requires notification of accidents and hazards associated with grant performance

• If the grant involves flight hardware, the hazardous aspects, if any, of such hardware will be identified, in writing, by the recipient

• There are no specific quality provisions or special conditions applicable to grants

Page No. 5

Commercial Considerations

SMA Requirements Specific to Buying Commercial

For Space Act Agreements• NAII 1050.1 requires that SAAs address liability and risk associated with

potential damages to persons and property arising from activities under the SAA

• For SAAs covering high-risk activities, the SAA Partner must be insured to protect the Agency against resulting losses

• The SAA Partner must comply with all laws, regulations and government policies that affect or relate to the performance of the SAA. Special attention is given to safety, security, export control, and environmental regulations where violations may result in civil or criminal penalties.

• For domestic activities where there is the possibility of a serious accident or mission failure occurring, mishap and close call investigation requirements shall be included with liability and risk provisions

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Commercial Considerations

SMA Requirements Specific to Buying Commercial

For Streamlined Contract Solicitation and Evaluation (FAR Part 12)• Commercial procurements may apply “streamlined” acquisition procedures

• Relative values of evaluation factors do not need to be defined • Evaluation factors include: Technical Capability, Price, and Past Performance• Technical capability may be evaluated by how well the proposed products meet the Government

requirement instead of predetermined subfactors

• Some SMA-related provisions and clauses may be included in the contract • NFS 1852.223 Safety and Health clauses apply• NFS 1852.246-72 Material Inspection and Receiving Report

• Contracts for commercial items shall rely on contractors’ existing quality assurance systems. Any in-process inspection by the Government shall be conducted in a manner consistent with commercial practice• Tailoring provisions permit the application of FAR 52.246, including application of “Higher Level

Contract Quality Requirements” (FAR 46.311)

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Commercial Considerations

Insight/Oversight Models for Commercial Partners• Methods of achieving insight include:

• Document review• Meeting participation• Review of tests• Compliance audits

• Insight provides a levelof confidence to make an informed acceptancedecision, without relyingon frequent in-process controls and approvals(oversight)

Illustration courtesy of Hale and Bauer 2010

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Commercial Considerations

Lessons Learned: Effective Insight

NASA Launch Services (NLS) Program

• Commercial launch services acquired using firm-fixed-price indefinite-delivery, indefinite-quantity contracts

• Civil servants resident in vendor facility

• Open access to design and production processes, problem reporting, and daily informal meetings

• Multiple vendor participants in NLS have kept launches on schedule and costs within budget

Effective insight is key to success

Page No. 9

Commercial Considerations

Lessons Learned: Low Demand

DoD Evolved Expendable Launch Vehicle (EELV) Program

• Competition between two companies initially drove down anticipated cost

• When demand did not reach expectations,

costs rose 77%

• The two companies merged, eliminating competition and forcing DoD to rely on a single provider

Limited demand can stifle competition