A Colorado company's space plane could carry astronauts into low Earth orbit in a test next year, NASA says.

The space agency, Sierra Nevada Space Systems of Denver and the University of Colorado trumpeted their partnership in Boulder Saturday, The Denver Post reported.

Sierra Nevada received $20 million from NASA's Commercial Crew Development Program Space Systems to develop the Dream Chaser, which will be able to carrying seven passengers into orbit.

Deputy NASA Administrator Lori Garver said the program proved "that the government doesn't need to fund everything itself and that we don't have the answer to every question."

Sierra Nevada said the project is ahead of schedule and it hopes to test the Dream Chaser in May 2012.

The company has been testing a scale model at the university, with students' help.

"To have a chance to have hands-on experience while you're still in school, that is indeed a dream come true," said Luis Zea, who is helping design the cockpit.