June 23, 2006

Ms. Pamela Meredith

Zuckert, Scoutt & Rasenberger, LLP

888 17^th^ Street, NW

Washington, DC 20006-3309

Dear Ms. Meredith:

Thank you for your inquiry on behalf of Blue Origin, LLC (Blue Origin),
dated February 14, 2006. You asked whether Blue Origin requires a
license from the Federal Aviation Administration to operate a launch
site. You pointed out that legal considerations should prevent the FAA
from requiring Blue Origin to obtain a license to operate a launch site.
According to Blue Origin, if a launch licensee does not need a license
to operate a private launch site, a launch permittee should not either.
Also, you note that the FAA has made official statements that a launch
operator operating a private launch site need not obtain a license to
operate the site. Until the FAA reaches a decision in its rulemaking
governing experimental permits, where the agency has raised this issue
for notice and comment, the FAA will not require Blue Origin to obtain a
license to operate a launch site. Please, however, advise Blue Origin to
keep abreast of developments in that rulemaking.

As described in your correspondence, Blue Origin is developing a
reusable suborbital launch vehicle which it plans to operate under a
permit issued by the FAA. Blue Origin plans to launch from a private,
exclusive use site that it will not offer to others for use. It is the
FAA's understanding based on telephone conversations that Blue Origin
owns this site. Blue Origin represents that it is designing its launch
facilities to comply with the Department of Defense Ammunition and
Explosives Safety Standard, DoD 6055.9-STD (Oct. 2005) for its
monopropellant, hydrogen peroxide.

The FAA did advise Blue Origin that it must obtain a license to operate
a launch site. 49 U.S.C. chapter 701 (Chapter 701) does not define the
operation of a launch site. It does define a launch site as \"the
location on Earth from which a launch takes place \... and necessary
facilities at that location.\" 49 U.S.C. § 70102(7). To operate a launch
site in the United States, a person must have a license. 49 U.S.C. §
70104(a). Section 401.5 defines \"operation of a launch site\" as \"the
conduct of approved safety operations at a permanent site to support the
launching of vehicles and payloads.\" When promulgating this definition
of operation, the Department of Transportation observed that \"the
operation of a launch site involves continuing operations at a permanent
location.\" Licensing Regulations, 64 Fed. Reg. 11004, 1007 (Apr. 4,
1988). If a person operates a launch site, he or she must obtain a
license to do so under 14 CFR part 420. Section 420.3 provides that part
420 applies to a \"person seeking a license to operate a launch site or
to a person licensed under this part.\" When the FAA issued part 420, it
explained how only someone offering its site to others needed a license
under part 420. The FAA stated in the preamble that "\[b\]ecause a
launch site operator is someone who offers a launch site to others for
launch, only someone proposing such an offer need obtain a license to
operate a launch site. A launch operator proposing to launch from its
own launch site need only obtain a launch license because a launch
license will address safety issues related to a specific launch and
because the launch license will encompass ground operations.\" 65 Fed.
Reg. 62812, 62836 (Oct. 19, 2000). *See also id.*, at 62815; 64 Fed.
Reg. 34316, 34319 (Jun. 25, 1999). Part of the reason that the FAA
considered this approach acceptable was because a license to launch
encompasses so many hazardous launch processing activities.

Because that reason was flawed and inconsistent with Congress' mandate
that the FAA license the operation of a launch site, the FAA is
revisiting this issue in a notice of proposed rulemaking issued March
31, 2006, governing experimental permits for suborbital rockets (Permit
NPRM). As it explained in the Permit NPRM, the FAA finds that it must
revisit this issue for both licenses and permits because the existing
approach may leave safety issues unaddressed. The requirements of part
420 are necessary regardless of whether a launch vehicle is present at
the launch site.[^1] These concerns apply regardless of whether the
launch operator is authorized by a license or permit. Additionally,
because the scope of a permit may be even more narrow than the scope of
a license, the FAA could fail to address other safety issues as well.

Nonetheless, although it is perhaps the part 420 preamble that is
inconsistent with existing regulations, the FAA did state in that
preamble that a launch licensee operating a private use launch site need
not obtain a license to operate a launch site. In this context, the FAA
agrees that there is no need to distinguish between operators authorized
by a license or permit. Accordingly, for the time being, the FAA will
not require Blue Origin to obtain a license to operate a launch site.

Although Blue Origin states that it is willing to abide by part 420
through the terms and conditions of its permit, the FAA will not review
the part 420 issues as part of Blue Origin's permit application. This is
because if Blue Origin does not require a site license, part 420 does
not apply to its activities. The launch of a launch vehicle and the
operation of a launch site are two different things, and the regulation
of one does not necessarily entail the regulation of the other. For now,
to the extent that a requirement of part 420 is part of launch or launch
processing, the FAA may apply it as a term and condition of a permit.

This interpretation was prepared by Laura Montgomery, Senior Attorney in
the Regulations Division of the Office of the Chief Counsel, and
coordinated with the office of the Associate Administrator for
Commercial Space Transportation. We encourage you to contact us if we
can be of further assistance.

Sincerely,

Rebecca MacPherson

Assistant Chief Counsel for Regulations

[^1]: Under 49 U.S.C. § 70102(4), Congress defines launch to include
    activities involved in the preparation of a launch vehicle for
    launch when those activities take place at a launch site in the
    United States. This means that when a launch vehicle is not present
    at a launch site, the other activities at a launch site are not
    licensed. Some of those activities, such as the storage of
    explosives and mitigating the effects of lightning, create potential
    hazards addressed by part 420.