U.S. Space Force Reshapes Small-Launch Program

The U.S. Space Force is reverting the 1970s-era Rocket Systems Launch Program back to its customer-funded roots. But Congress is concerned that the shift will affect the small-launch market.

Lawmakers used the Senate Appropriations Committee’s fiscal 2025 defense markup, released on Aug. 1, to express concerns that although the Space Force and the National Reconnaissance Office have small-launch service contracts in place, “they are rarely used.”

“In a threat environment that requires tactical responsiveness, small-launch providers are most likely to provide this capability,” the markup states.

• Lawmakers concerned about the impact on emerging launch providers
• RSLP is “going back to our heritage”

Senate appropriators also criticized the fact that the Space Force will launch only one payload through the fiscal 2024 Orbital Services Program (OSP) and requested no funds for the program’s fiscal 2025 budget. Lawmakers called the program “critical to having a rapidly responsive launch capability and to maintaining a competitive and innovative industrial base.”

Space Force officials say that this funding shift is by design and that the OSP, which sits under the Rocket Systems Launch Program (RSLP), is not intended to maintain a steady funding stream.

The Defense Department established the Advanced Ballistic Missile Reentry Systems program in 1963 to manage the reutilization of deactivated ICBM assets and to perform reentry vehicle research. That effort evolved in 1972 into the RSLP program, which has provided launch options for missions with payloads weighing 400 lb. or more using retired Minuteman and Peacekeeper rocket motors, along with commercially acquired small-launch vehicles. The goal is to launch within 18-24 months, once the effort is on contract.

Historically, the RSLP procured launch services for such government partners as the U.S. Air Force, Missile Defense Agency, National Reconnaissance Office, U.S. Army and NASA on a case-by-case, customer-funded basis. But starting in 2019, the program included regular funding in its annual budget to support one or two launches per year, primarily in support of the Space Test Program (STP).

The RSLP received about $39 million in procurement funds in fiscal 2023 and nearly $75 million in fiscal 2024, but the Space Force zeroed out procurement dollars for the program in its fiscal 2025 budget request.

This funding shift “is really going back to our heritage” as a flexible contract provider that can support a very specific suborbital or orbital launch need, says Lt. Col. Steve Hendershot, chief of Space Systems Command’s Small Launch and Targets Division. “We are just doing it on a cost-reimbursable order.”

The Space Force conducted nine RSLP launches for both suborbital and orbital missions from 2022 to June of this year. Two of those launches were funded by the program office—the service’s STP-S28A mission launched by Virgin Orbit in 2022, and the Victus Nox tactically responsive space mission in September 2023. The other seven were customer-funded, Space Force data shows. The service plans to launch four more STP missions before 2027.

It is now time for the STP program to stand on its own legs, says Col. Doug Pentecost, deputy program executive officer for Space Systems Command’s Assured Access to Space.

“We’ve determined that the Space Test Program—which is the primary use of this RSLP funding line—[needs] to build a budget for their own mission and focus on their capabilities,” he says.

Small-launch vendors can still bid for the RSLP opportunities via the OSP pathway. In July, the service awarded new contracts to Blue Origin and Stoke Space, allowing the two companies to compete for OSP-4 task orders alongside 10 other vendors: ABL Space Systems, Aevum, Astra Space, Firefly Space, Northrop Grumman, Relativity Space, Rocket Lab, SpaceX, United Launch Alliance (ULA) and X-Bow. The OSP-4 contract has a $986 million ceiling, and orders are scheduled to take place through October 2028. Although OSP missions are typically focused on small-launch capabilities, there is no upper limit on the size of launch vehicles available to compete on the contract.

The service awarded one OSP launch under its fiscal 2024 budget to Rocket Lab in April for STP-S30. The dedicated Electron launch will take place by the third quarter of fiscal 2026, from the Virginia Spaceport Authority’s Mid-Atlantic Regional Spaceport within the NASA Wallops Flight Facility. It will carry the experimental DiskSat spacecraft, a 1-m-dia. (3.3-ft.), plate-shape satellite bus developed by the Aerospace Corp.

The RSLP program will continue to receive R&D funding. The Space Force anticipates requiring $20-21 million per year in research, development, test and evaluation funds for RSLP across the five-year Future Years Defense Program, fiscal 2025 budget documents state. Those funds are used to secure and store decommissioned ICBMs and facilitate their reutilization for launch services. RSLP also uses congressional funding to enhance launch capabilities at state-owned spaceports, including Virginia’s Mid-Atlantic Regional Spaceport and the Pacific Spaceport Complex-Alaska on Kodiak Island.

Emerging launch service companies also have a new contract vehicle to get involved with the Space Force since the service divided the National Security Space Launch (NSSL) Phase 3 into two lanes this year. Lane 1 missions are open to launch providers with just one proven flight that are willing to accept a higher risk of failure and include lighter payloads going to less-challenging orbits.

Blue Origin, SpaceX and ULA won the first three Lane 1 contracts in June as the only three competitors whose rockets have either reached orbit or—in the case of Blue Origin—presented a plan to launch an orbital-class rocket successfully by the end of 2024. The Space Force plans to open up Lane 1 to new vendors once a year, as rocket-makers mature their systems. The service is going through source selection for the first Lane 1 task orders. The three current vendors are eligible to compete for up to 30 launches until June 2029 through a firm-fixed-price (FFP), indefinite-delivery/indefinite-quantity (IDIQ) contract worth a maximum of $5.6 billion.

Meanwhile, Lane 2 is a direct follow-on to the ongoing NSSL Phase 2 program—serviced by ULA and SpaceX—with the same launch vehicle certification requirements and the ability to fulfill the full range of NSSL mission profiles. The Space Force plans to award contracts for Phase 3 Lane 2 by the end of 2024, Pentecost says.

The RSLP program is complementary to the NSSL construct by providing small launch and targets for a range of missions, but the former has the explicit goal of enabling a launch within two years of contract award. RSLP launches also do not require the NSSL certification process.

On the civil space side, NASA’s Launch Services Program at Kennedy Space Center runs a similar initiative called the Venture-Class Acquisition of Dedicated and Rideshare Launch Services (VADR) program. The VADR setup is intended to provide a broad range of commercial launch services capable of delivering Class D, cubesats and higher risk-tolerant payloads to a variety of orbits, and it features a roster of vendors similar to the RSLP.

The VADR contracts are FFP, IDIQ procurements with an ordering period through February 2027 and a maximum total value of $300 million across the program. It builds upon previous procurement programs, including the Venture-Class Launch Services (VCLS) and VCLS Demo 2.

Fourteen companies are now eligible to compete for the VADR task orders; the most recent three—Arrow Science and Technology, Impulse Space and Momentus Space—joined the program in August. Other current VADR vendors include ABL Space Systems, Astra, Blue Origin, Firefly, L2 Solutions, Northrop Grumman, Phantom Space, Relativity Space, Rocket Lab, SpaceX and ULA.

While the government continues to be the primary investor in space—and thus launch—technologies, rocket startups have remained buoyed by venture capital investments. Stoke Space, a vendor for the OSP-4 program and an unsuccessful bidder for NSSL Phase 3 Lane 1, raised $100 million in Series B investments in 2023. Meanwhile, Impulse Space—one of three new vendors for the NASA VADR program—raised $45 million in Series B funding last year.

Despite the healthy flow of venture capital investment into the launch market, it is still vastly overshadowed by government contracts. Outside the U.S., the European Space Agency’s Flight Ticket Initiative is also working to stimulate the small-launch market, supporting such companies as Isar Aerospace and Rocket Factory Augsburg.

The Space Force might consider itself less as a supporter of the emerging commercial launch market writ large, even if that is the ultimate outcome of its programs, says Dallas Kasaboski, principal analyst with NSR, an Analysys Mason company.

“What they might be supporting is additional types of service, security and reliability, which happens to be something that a lot of the new and emerging players are pursuing as a way of differentiating themselves compared to the very competitive established players,” he says.

While one of the goals of the RSLP is to boost small-launch suppliers, “at the same time, we also don’t want to be the market driver and pick winners and losers,” Pentecost says.

The one or two STP missions per year cannot be the primary driver by which a small-launch company survives or not, he adds. “We want to take advantage of the diversity of the launch market and support it,” Pentecost says. “We also want to put capability in space and focus our funding there.”