NASA is free to lease an inactive Kennedy Space Center launch pad to a commercial user -- either billionaire-backed Blue Origin or SpaceX -- after an independent government watchdog on Thursday denied a protest disputing the fairness of the agency's search for a long-term tenant to take over the former space shuttle launch complex.

Photo of a mobile launch platform at launch pad 39A. Credit: NASA/Kim Shiflett
 
The protest was filed by Blue Origin, a private rocket company owned by Amazon.com founder Jeff Bezos. It challenged NASA's terms for finding a company to assume control of launch pad 39A, an historic facility built in the 1960s for the Apollo moon program and modified to support space shuttle launches.

Blue Origin and SpaceX, led by Paypal founder Elon Musk, responded to NASA's announcement for proposals issued in May to seek proposals to use pad 39A for commercial launches. According to the GAO decision released Thursday, Blue Origin and SpaceX were the only two companies to submit proposals by the July 5 deadline.

Blue Origin claimed NASA's solicitation for a commercial launch pad tenant "provided for a preference in favor of a multi-user (as opposed to an exclusive use) approach to utilizing the launch pad," according to the GAO decision released Thursday. "NASA took the position that neither position was favored ... GAO agreed with NASA, and in its decision concluded that there was no preference for either approach."

"Given today's GAO ruling, NASA is looking forward in the near future to selecting an industry partner for negotiations to lease and operate LC-39A," NASA spokesperson Allard Beutel said in a written statement Thursday. "Permitting use of this valuable national asset by commercial entities will ensure its continued viability and will allow for its continued use in support of U.S. space activities."

Launch pad 39A is not in NASA's plans. The space agency's Space Launch System, a mega-rocket cannibalizing technology from the space shuttle and Delta 4 rocket, will launch on crewed deep space missions from nearby pad 39B, which NASA intends to retain under government control.

The first unmanned test flight of the SLS with NASA's Orion spacecraft is set for 2017, with the first manned launch not scheduled until 2021. NASA officials outline a best-case scenario of one SLS flight per year in the 2020s, given a sufficient budget.

NASA hoped to award a commercial lease of pad 39A by Oct. 1, but it was restricted from taking action while the GAO reviewed Blue Origin's challenge. In 2012, NASA spent about $100,000 per month maintaining the pad, and the agency is eager to get the property off its books.

According to the GAO decision on Blue Origin's protest, SpaceX proposed taking exclusive control of launch pad 39A. Blue Origin's plan called for the complex to be available to multiple rockets. NASA has not said how long it would lease pad 39A to either tenant.

File photo of the shuttle Atlantis on launch pad 39A before the final space shuttle launch in July 2011. Credit: NASA/Frank Michaux
 
But as Blue Origin's protest went public, drawing letters in support and opposition from members of Congress, SpaceX said it would be open to others using pad 39A.

"SpaceX has nearly 50 missions on manifest to launch over the proposed 5 year lease period and we can easily make use of the additional launch site," the company said in a written statement sent to reporters in September. "At the time we submitted the bid, SpaceX was unaware any other parties had interest in using the pad. However, if awarded this limited duration lease on 39A, SpaceX would be more than happy to support other commercial space pioneers at the pad, and allow NASA to make use of the pad if need be."

Emily Shanklin, a SpaceX spokesperson, said Thursday the company still stands by the statement.

Given the projected low flight rate of the Space Launch System, Kennedy Space Center director Bob Cabana said Wednesday that launch pad 39B could support multiple rockets smaller than the SLS. Engineers are outfitting the launch complex with reconfigurable flame deflectors that could be tailored to different types of rockets, and NASA's decommissioned space shuttle mobile launch platforms are on the list of items to be dispersed to commercial operators such as SpaceX and Blue Origin.

SpaceX wants to use pad 39A as a second home in Florida for the company's Falcon rocket family. The Hawthorne, Calif.-based firm currently operates a leased launch pad on U.S. Air Force property just south of Kennedy Space Center, but Musk said he expects the Falcon rocket's flight rate to outgrow the capacity of SpaceX's existing pad.

In an interview with Spaceflight Now in September, Musk said he wants to launch SpaceX's commercial cargo and crew missions to the International Space Station from launch pad 39A, assuming the company wins control of the complex. Launches for the U.S. military would be based at launch pad 40 at Cape Canaveral Air Force Station, where SpaceX is already flying.

Artist's concept of the Falcon Heavy rocket, which SpaceX says will make its first launch in late 2014. Credit: SpaceX
 
SpaceX's Falcon Heavy rocket, set for a first test launch from California in late 2014, could also lift off from launch pad 39A.

Blue Origin's vision for launch pad 39A is less clear, but its protest was backed by United Launch Alliance, a joint company formed in 2006 by industry giants Boeing Co. and Lockheed Martin Corp. ULA's Atlas and Delta rockets hold contracts to launch nearly all of the U.S. military's satellites.

Blue Origin is working on reusable suborbital and orbital launchers at a test site in the West Texas desert, and the company won $25.7 million in NASA funding to test components of a reusable hydrogen-fueled rocket engine and a pusher escape system to lift a crewed capsule away from a failing booster.

Under the funding agreement with NASA, Blue Origin proposed developing a biconic crew capsule to launch on top of a United Launch Alliance Atlas 5 rocket.

ULA spokesperson Jessica Rye referred questions on the GAO ruling to Blue Origin. A Blue Origin spokesperson was not available for comment Thursday.

Like SpaceX, ULA is a participant in NASA's commercial crew program, which aims to launch astronauts from U.S. soil by 2017, ending NASA's reliance on Russian Soyuz vehicles for the job of transporting crew to the International Space Station.

SpaceX plans to launch a manned version of its Dragon cargo capsule on the company's own Falcon 9 rocket. ULA has agreements to launch astronauts on Boeing's CST-100 spacecraft and the Sierra Nevada Corp. Dream Chaser space plane on the Atlas 5 rocket.

Follow Stephen Clark on Twitter: @StephenClark1.