NASA is still trying to salvage the Centennial Challenges program, but Congress remains resistant.

...Democrats on the subcommittee, including Reps. Nick Lampson, Sheila Jackson Lee and Bernice Johnson (all from Texas), expressed reservations about relying on prize money to spur technological innovation.

“While establishment of a NASA prize program is certainly worth considering, we should not be lulled into thinking that it is any substitute for providing adequate funding for NASA’s R&D programs,” said Lampson, the subcommittee’s ranking Democrat.

Wonderful. Assuming they properly funded R&D they might have an argument - if it was just about research. Might. A prize creates a limited artificial market. It draws people from outside the regular teams that may have new and different ideas. It creates interest. It GETS PEOPLE INVOLVED. (Imagine the young folks at universities that would get into these things!)
And it doesn't COST ANYTHING unless somebody does something good enough to win a prize. But it is no surprise that the obvious example of the X Prize would make no impression on them.

"And it doesn't COST ANYTHING "

This is not quite true. That money has to be allocated, meaning that it comes out of the agency's regular budget and cannot be used for anything else. Even if nobody wins it, the agency has not been able to use it for other things on its agenda and most likely the money simply disappears back into the treasury.

To illustrate: suppose an agency is normally funded at $1 billion a year. Then Congress creates a $100 million prize. This means that the agency now only has $900 million to spend on its operations and things like that, not $1 billion. If nobody wins the prize, the agency does not get to spend that money.

So a prize does have an opportunity cost for the agency.