The U.S. House of Representatives’ defense policy bill for fiscal year 2027 proposes a significant restructuring within the U.S. Space Force, seeking to eliminate the Space Development Agency (SDA) and the Space Rapid Capabilities Office (Space RCO). This legislative proposal aims to integrate their functions and programs into the service’s newly established portfolio-based acquisition system, signaling a major shift in how the Space Force acquires and fields critical space capabilities.
The draft National Defense Authorization Act (NDAA), released by the House Armed Services Committee (HASC) on May 26, specifically calls for the repeal of the laws that originally established both the Space Development Agency and the Space Rapid Capabilities Office. Should this language be approved, it would pave the way for a comprehensive overhaul of space acquisition processes.
This proposed change is directly linked to a broader acquisition reform mandate across all military services, issued by Defense Secretary Pete Hegseth. The reform’s objective is to streamline the acquisition process by consolidating existing program offices under the oversight of nine “portfolio acquisition executives” (PAEs). These executives will be responsible for managing programs within specific mission areas, with the eventual authority to reallocate funding and adjust requirements dynamically based on evolving threats and operational demands. The core intent of this reorganization is to empower acquisition leaders, enabling them to accelerate the delivery of advanced defense capabilities.
The Space RCO and the Space Development Agency were initially established by congressional mandate precisely to circumvent traditional, often slow, Pentagon acquisition structures. They were designed to operate with enhanced agility and speed, embodying many of the rapid capability delivery principles that Secretary Hegseth’s current reform push now seeks to implement across the entire defense acquisition enterprise. With the entire system shifting towards this rapid, portfolio-based approach, the Space Force is evaluating whether dedicated, standalone rapid acquisition offices remain necessary.
Space Force officials have progressively indicated this intent as they have rolled out elements of their PAE structure over recent months. Air Force Secretary Troy Meink, speaking on April 13 at the Space Symposium in Colorado Springs, Colo., articulated this vision: “The way the SDA and the RCO have been structured, to be honest, those are kind of the models of how we’re actually going to structure all the PAEs. The goal is, pretty much the way SDA operates, most of the PAEs would be operating in a very similar fashion.”
Thomas Ainsworth, the acting space acquisition executive, further elaborated on May 27 that the service is closely examining organizations like SDA, Space RCO, and the National Reconnaissance Office (NRO) as it determines the specific authorities to grant its PAEs. While he did not detail these authorities, as they are still being finalized, Ainsworth mentioned plans to establish a “capability trade council,” similar to SDA’s warfighter council, which will incorporate operator input into requirements decisions. He also emphasized the Space Force’s aim for consistency in authorities across all PAEs, stating, “They have the same authorities. If you move between one PAE and another, you’re not sitting there having to figure out a whole new process. Everyone’s working off of the same process in the same rule book.”
The Space RCO, created in 2018, specializes in the rapid development and deployment of high-priority, often classified, space capabilities. It works in close coordination with combatant commands and end-users to address urgent operational needs. Known programs include the Remote Modular Terminal, a deployable satellite communications jammer currently in operational use by Combat Forces Command’s Mission Delta 3. Another publicly acknowledged Space RCO initiative is the Rapid Resilient Command and Control program, which seeks to establish a consolidated, cloud-based platform for operating both new and legacy orbital warfare satellites.
Meanwhile, the Space Development Agency, established in 2019, was initially conceived as the Department of Defense’s pioneering effort to build a proliferated satellite constellation in low-Earth orbit (LEO). SDA’s primary mission has focused on fielding data transport and missile warning and tracking satellites, employing a strategy that prioritizes regular technology refresh cycles and competitive contracting. In 2023, the agency launched its first batch of demonstration satellites, known as Tranche 0, and is currently in the process of deploying its initial operational spacecraft.
The legislative proposal for the dissolution of these offices is still subject to approval by the full House and the Senate before it can become law. However, the Space Force has already begun to integrate SDA into its planned PAE structure. Earlier this month, the Space Force announced that SDA’s current director would assume the role of PAE for missile warning and tracking, incorporating the agency’s LEO satellites into that portfolio. Furthermore, while the Space Force plans to field the first two tranches of SDA’s transport layer, its fiscal year 2027 budget request proposes canceling future tranches. Instead, the service aims to shift its tactical data transport requirements into a new, broader hybrid architecture known as the Space Data Network.
The integration path for the Space RCO’s programs into the new acquisition structure, should Congress ultimately eliminate the office, remains less defined. Kelly Hammett, the director of the Space RCO, described the ongoing uncertainty as “a bit of a frustrating journey” during the same May 27 event, noting recent discussions with Thomas Ainsworth on the matter. “All the details about what that means have not rolled out. It’s come out in bits and pieces,” Hammett remarked. He also voiced concerns about the potential impact on his team: “I’ll just say, from my perspective, I spent four years trying to build this world-class organization of highly trained acquisition hunter-killers, and we’re finally there. I just hope that that is recognized and valued and maintained as this whole journey continues to move forward.”
Why This Matters
The proposed dissolution of the Space Development Agency (SDA) and the Space Rapid Capabilities Office (Space RCO) is a pivotal development that could significantly reshape the future of U.S. space capabilities and defense acquisition. This move signals a profound commitment by the Space Force and the Department of Defense to fundamentally alter how military space systems are developed, procured, and deployed, moving away from specialized rapid acquisition entities towards an integrated, portfolio-based approach.
First, the reform aims to achieve greater **efficiency and speed** across all Space Force acquisitions. SDA and Space RCO were created to bypass traditional bureaucracy and deliver capabilities quickly. By embedding these “rapid acquisition” principles into the new Portfolio Acquisition Executive (PAE) structure, the Space Force hopes to accelerate delivery across a wider range of programs, making the entire system more agile. However, the success of this strategy hinges on whether the new PAEs can truly replicate the specialized expertise, streamlined processes, and independent authorities that allowed SDA and Space RCO to operate effectively outside the conventional system. If not executed carefully, there is a risk of inadvertently slowing down programs or losing the advantages gained by these dedicated organizations.
Second, this restructuring carries significant implications for **innovation and industrial competition**. SDA, in particular, has been credited with fostering a more dynamic space industrial base by regularly refreshing technology and emphasizing competition among commercial vendors for its proliferated LEO constellations. The question arises whether the broader PAE system can maintain this level of innovation and leverage commercial capabilities effectively, or if a more centralized approach might inadvertently stifle some of this dynamism. The fate of SDA’s future tranches and the shift towards a “Space Data Network” indicate a strategic re-evaluation of how transport layer capabilities will be acquired, potentially impacting current and future contractors.
Third, the decision addresses concerns about **potential redundancy and organizational overlap**. As the Space Force matures and its acquisition processes evolve, the need for separate rapid acquisition offices may diminish if their core functions can be absorbed and standardized across the entire service. This could lead to a more coherent and integrated approach to space acquisition, reducing fragmentation and optimizing resource allocation. Conversely, there is a risk of losing the specialized “hunter-killer” expertise and unique operational culture that organizations like Space RCO have cultivated, as expressed by its director, Kelly Hammett. Preserving this talent and capability within the new structure will be a critical challenge.
Finally, this legislative push underscores the **strategic imperative of rapid capability delivery** in an increasingly contested space domain. With adversaries like China and Russia rapidly advancing their space capabilities, the U.S. needs to field resilient and advanced systems faster than ever before. The success or failure of this Space Force acquisition reform will directly impact the nation’s ability to maintain its competitive edge in space, influencing everything from global communications and navigation to missile warning and defense. Congress’s willingness to mandate such a significant organizational change reflects a high-level determination to ensure the Space Force is optimally structured to meet current and future national security challenges.