Space Force sets up ‘working capital fund’ for commercial space services

WASHINGTON — The U.S. Space Force has established a working capital fund with a projected value of more than $1 billion to help facilitate military agencies’ access to commercial space services.

The Space Systems Command announced Oct. 8 that the Enterprise Space Activity Group (ESAG) was established Oct. 1 under the Air Force Working Capital Fund.

This fund is meant to help military users purchase services such as commercial satellite communications.

“The establishment of a Working Capital Fund for the U.S. Space Force represents an important milestone in integrating commercial capabilities into the architecture,” said Col. Timothy Trimailo, head of the command’s Commercial Space Office.

A revolving fund model

A Working Capital Fund (WCF) is a self-sustaining pool of money used by defense organizations to pay for routine goods and services. Instead of relying on annual congressional funding, a WCF works like an internal business: customers pay fees that cover costs, and those revenues are reinvested to keep the fund running.

“The WCF operates on a ‘break-even’ basis with a long-term strategy,” the Space Systems Command said. “Any profits can lead to lower rates for customers in the future, while losses may require higher rates; or a request for more money may be needed to add more money to the corpus.”

The Space Force described its version as an “adaptable and scalable financial platform” designed to support future commercial space demands.

The new fund began operations with an initial $120 million deposit and is expected to handle more than $1.2 billion annually. The Commercial Satellite Communications Office (CSCO) — which manages military contracts for commercial satellite services — is the first program authorized to use it.

“The fund allows enough lead time to budget for anticipated demand,” said Clare Hopper, CSCO’s director.

Transitioning contracts from DISA

Until now, CSCO had relied on the Defense Information Systems Agency (DISA) to procure commercial satellite services through its own working capital fund. When CSCO moved under the Space Force in 2019, it became the Defense Department’s sole authority for commercial satellite communications across U.S. military branches, government agencies, and allied partners.

The creation of ESAG allows those contracts and operations to move under Space Force control. “We’re looking forward to offering even more capabilities that our warfighters need,” Hopper said.

The Space Systems Command and CSCO have spent several years preparing to launch the fund but had to wait for Congress to approve initial funding in the 2025 spending bill. With that in place, several existing satellite communications contracts will now shift from DISA to the Space Force.

CSCO oversees nearly $7 billion worth of satellite communications services contracts.