NASA’s Office of Inspector General (OIG) issued a report today on NASA’s management of the commercial crew program under which SpaceX and Boeing are developing systems to provide crew transportation to and from the International Space Station (ISS). The report warns that technical challenges now are the primary obstacle and routine, certified flights are unlikely before the end of 2018. NASA’s failure to respond to “hazard reports” from the companies in a timely manner exacerbates the problem and could lead to design changes late in the development program that could cause further delays.

Coincidentally, the report was released on the same day that SpaceX suffered an explosion on its Cape Canaveral launch pad during a pre-launch test for a commercial communications satellite. What impact that will have on SpaceX launches for commercial or government customers — including for NASA — is not known at this time. The Falcon 9 rocket and AMOS-6 satellite were destroyed and video of the incident suggests that the launch pad may have been significantly damaged. No one was injured.

The NASA OIG report is a follow-up to one that it issued in 2013 on NASA’s management of the commercial crew program. Commercial crew is a public private partnership where NASA and the companies each provide part of the development funding for new crew space transportation systems in exchange for NASA guaranteeing to purchase a certain number of flights. A NASA official testified to Congress in 2012 that NASA is paying the majority of the development funding. The OIG report shows that NASA Is on track to spend $6.165 billion on commercial crew development (not services) by FY2020.

NASA chose SpaceX and Boeing as the two commercial crew companies in 2014 under what is called the Commercial Crew Transportation Capability (CCtCAP) contract. SpaceX is building the Crew Dragon spacecraft to be launched on its own Falcon 9 rockets. Boeing is building the CST-100 Starliner spacecraft to be launched on United Launch Alliance (ULA) Atlas V rockets. Boeing and Lockheed Martin jointly own ULA.

NASA has been unable to launch astronauts into space since the termination of the space shuttle program in 2011. It pays Russia to launch and return NASA astronauts as well as astronauts from ISS partners Canada, Europe and Japan in conformance with the agreement that governs the ISS program. (When the agreement was signed, NASA anticipated that the space shuttle would be flying until the end of the ISS program and providing crew transportation services was part of the barter arrangements with those countries in exchange for hardware and services they agreed to contribute. When NASA terminated the shuttle, it remained obligated to provide those crew transportation services). The OIG reported that NASA will have paid Russia $3.4 billion between 2006 and 2018 to launch 64 NASA/partner astronauts at a price per round-trip seat of $21.3 million at the beginning to the current price of $81.9 million.

When the commercial crew program began, NASA hoped to have routine flights by 2015, but that slipped in large part due to congressional underfunding in the early years. OIG noted today that its 2013 report found that adequate funding was the major challenge for the program. Congress has warmed up to the program, however, and now is approving the full President’s request so funding is not the issue it once was. Technical challenges now are the major hurdle according to today’s report.

The companies’ systems must be certified by NASA before beginning routine flights to ISS. Boeing anticipates receiving certification in January 2018 with its first certified flight in spring 2018, and SpaceX is working toward late 2017 for its first certified mission, the OIG report says. But it is skeptical: “Notwithstanding the contractors’ optimism, based on the information we gathered during our audit, we believe it unlikely that either Boeing or SpaceX will achieve certified, crewed flight to the ISS until late 2018.”

In that vein, the OIG found that NASA is not responding to “hazard reports” from the companies in a timely manner, which could mean significant design changes late in the development program that could lead to additional delays. Hazard reports “identity potential safety concerns and may result in the contractor requesting a variance to Agency requirements,” the OIG report states. NASA has a “goal” of responding to hazard reports within 8 weeks, but it is taking much longer.

Between February 2015 and June 2016, the companies submitted a combined total of 172 hazard reports and NASA has reviewed 134 of them and tentatively approved 105. However, “almost all of the tentative approvals are contingent on receipt of additional verification testing results… If the contractors are required to make changes to their systems based on NASA’s decisions…., there could be more delays.” The OIG reported that the companies themselves have expressed concern on this matter.

The OIG also found that NASA’s Commercial Crew Program is not monitoring the timeliness of its hazard report review process. It recommended that NASA do so, and NASA agreed. The OIG also recommended that NASA coordinate with Boeing and SpaceX to “document a path to timely resolution” of hazard reports and although NASA agreed that coordination is necessary, the OIG believes that NASA needs to do more.

NASA’s response to a draft of the report is published as an appendix.