Space Development Agency satellite procurements moving forward amid heightened scrutiny
SDA, a six-year-old agency under the U.S. Space Force, is advancing plans to acquire 54 additional satellites for a missile defense tracking system the agency plans to deploy in low Earth orbit. At the same time, it’s working to re-compete a separate 10-satellite contract after a Department of the Air Force review determined that the initial award process had been improperly handled.
The agency’s ability to execute these procurements effectively, meanwhile, is under scrutiny as defense leaders assess whether SDA’s acquisition approach aligns with long-term national security objectives.
Fallout from procurement scandal
The disruption at SDA began last month when its former director, Derek Tournear, was placed on administrative leave after an internal Department of the Air Force investigation. That probe stemmed from a bid protest filed in September 2024 in the U.S. Court of Federal Claims by Viasat, which alleged that SDA’s $424 million contract awards to York Space Systems and Tyvak Nano-Satellite Systems (now Terran Orbital, a subsidiary of Lockheed Martin) for 20 Tranche 2 Transport Layer (T2TL) Gamma satellites were unfairly evaluated.
According to court documents, the Department of the Air Force in a review completed Jan. 10 concluded that SDA’s actions leading up to one of the T2TL contract awards violated the Procurement Integrity Act, which bars the improper disclosure of bid information. Investigators found that Tournear directed Terran Orbital to collaborate with an undisclosed company to strengthen its proposal, an action deemed prejudicial to other competitors. While York’s $170 million contract remains in place, Terran Orbital’s award was rescinded, and the 10 satellites it was set to build will now be re-competed under a process overseen by officials uninvolved in the original selection.
In court filings Feb. 14, the Department of the Air Force said SDA’s acting director William Blauser and senior Space Force officials determined the 10 satellites remain critical to the mission despite additional costs and delays from the procurement’s re-competition.
“Acquisitions and programs are moving forward,” an SDA spokesperson said in a statement to SpaceNews, adding that the agency is preparing to release a fresh solicitation for the 10 satellites in the near future.
Tranche 3 Tracking Layer proposals
In parallel with efforts to correct procurement missteps, SDA is advancing the first major satellite acquisition since Tournear’s removal: a 54-satellite procurement for the Tranche 3 Tracking Layer of the Proliferated Warfighter Space Architecture (PWSA). This next-generation missile tracking constellation builds on the foundation of earlier tranches, expanding coverage and improving real-time threat detection capabilities.
The Tracking Layer, expected to consist of over 100 satellites deployed in six orbital planes, is a linchpin of the administration’s “Iron Dome for America” missile-defense plan. Each plane would be positioned to ensure persistent global coverage, particularly over high-risk regions such as the poles and mid-latitudes where missile threats may emerge.
“The first Tranche 3 solicitation recently hit the street, and additional drafts and solicitations are forthcoming,” the spokesperson said. “The SDA team remains focused on delivering next-generation capabilities to the warfighter with speed and discipline. We understand the importance of delivering these capabilities as quickly as possible.”
Pentagon scrutiny and independent review
Separate from the Air Force’s procurement review, the Office of the Secretary of Defense has ordered an independent assessment of SDA’s operations, underscoring concerns about the agency’s acquisition strategies and its ability to meet critical requirements.
“Given the criticality of the SDA’s Proliferated Warfighter Space Architecture support to joint warfighters, the Undersecretary of Defense for Acquisition and Sustainment has a vested interest in ensuring programs and contracts still support a pathway to meet PWSA requirements,” Steven Morani, the acting undersecretary for acquisition and sustainment, wrote in a Jan. 31 memo.
The independent review will evaluate SDA’s organizational performance, acquisition approach, and its capacity to deliver on PWSA objectives amid ongoing disruptions. One issue that might be examined, according to industry sources, is SDA’s reliance on Other Transaction Authority (OTA) agreements — nontraditional contracting mechanisms that expedite acquisitions but limit legal recourse for competing firms.Since 2021, most of SDA’s contract awards have been structured as OTA agreements, allowing for greater flexibility to negotiate terms with suppliers. But unlike traditional Federal Acquisition Regulation-based contracts, which can be challenged at the Government Accountability Office, OTA awards can only be contested in the U.S. Court of Federal Claims, which has a higher bar for proving improper conduct.
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The agency’s ability to execute these procurements effectively, meanwhile, is under scrutiny as defense leaders assess whether SDA’s acquisition approach aligns with long-term national security objectives.
Fallout from procurement scandal
The disruption at SDA began last month when its former director, Derek Tournear, was placed on administrative leave after an internal Department of the Air Force investigation. That probe stemmed from a bid protest filed in September 2024 in the U.S. Court of Federal Claims by Viasat, which alleged that SDA’s $424 million contract awards to York Space Systems and Tyvak Nano-Satellite Systems (now Terran Orbital, a subsidiary of Lockheed Martin) for 20 Tranche 2 Transport Layer (T2TL) Gamma satellites were unfairly evaluated.
According to court documents, the Department of the Air Force in a review completed Jan. 10 concluded that SDA’s actions leading up to one of the T2TL contract awards violated the Procurement Integrity Act, which bars the improper disclosure of bid information. Investigators found that Tournear directed Terran Orbital to collaborate with an undisclosed company to strengthen its proposal, an action deemed prejudicial to other competitors. While York’s $170 million contract remains in place, Terran Orbital’s award was rescinded, and the 10 satellites it was set to build will now be re-competed under a process overseen by officials uninvolved in the original selection.
In court filings Feb. 14, the Department of the Air Force said SDA’s acting director William Blauser and senior Space Force officials determined the 10 satellites remain critical to the mission despite additional costs and delays from the procurement’s re-competition.
“Acquisitions and programs are moving forward,” an SDA spokesperson said in a statement to SpaceNews, adding that the agency is preparing to release a fresh solicitation for the 10 satellites in the near future.
Tranche 3 Tracking Layer proposals
In parallel with efforts to correct procurement missteps, SDA is advancing the first major satellite acquisition since Tournear’s removal: a 54-satellite procurement for the Tranche 3 Tracking Layer of the Proliferated Warfighter Space Architecture (PWSA). This next-generation missile tracking constellation builds on the foundation of earlier tranches, expanding coverage and improving real-time threat detection capabilities.
The Tracking Layer, expected to consist of over 100 satellites deployed in six orbital planes, is a linchpin of the administration’s “Iron Dome for America” missile-defense plan. Each plane would be positioned to ensure persistent global coverage, particularly over high-risk regions such as the poles and mid-latitudes where missile threats may emerge.
“The first Tranche 3 solicitation recently hit the street, and additional drafts and solicitations are forthcoming,” the spokesperson said. “The SDA team remains focused on delivering next-generation capabilities to the warfighter with speed and discipline. We understand the importance of delivering these capabilities as quickly as possible.”
Pentagon scrutiny and independent review
Separate from the Air Force’s procurement review, the Office of the Secretary of Defense has ordered an independent assessment of SDA’s operations, underscoring concerns about the agency’s acquisition strategies and its ability to meet critical requirements.
“Given the criticality of the SDA’s Proliferated Warfighter Space Architecture support to joint warfighters, the Undersecretary of Defense for Acquisition and Sustainment has a vested interest in ensuring programs and contracts still support a pathway to meet PWSA requirements,” Steven Morani, the acting undersecretary for acquisition and sustainment, wrote in a Jan. 31 memo.
The independent review will evaluate SDA’s organizational performance, acquisition approach, and its capacity to deliver on PWSA objectives amid ongoing disruptions. One issue that might be examined, according to industry sources, is SDA’s reliance on Other Transaction Authority (OTA) agreements — nontraditional contracting mechanisms that expedite acquisitions but limit legal recourse for competing firms.Since 2021, most of SDA’s contract awards have been structured as OTA agreements, allowing for greater flexibility to negotiate terms with suppliers. But unlike traditional Federal Acquisition Regulation-based contracts, which can be challenged at the Government Accountability Office, OTA awards can only be contested in the U.S. Court of Federal Claims, which has a higher bar for proving improper conduct.
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