They tell the paper that the president's budget, which will be released next week, will not allocate the money needed to fund the Constellation program that aimed to return humans to the moon by 2020.
"We certainly don't need to go back to the moon," one administration official told the paper.
Money instead will go toward NASA's development of a "heavy-lift" rocket that will allow humans and robots the chance to explore Earth's orbit, though the Sentinel reports that concept is still decades away from being a reality.
The sources add that the government will also invest money into private companies developing rockets and capsules that could serve as "space taxis" for astronauts headed to the International Space Station.
President Obama is likely to ask Congress for a spending freeze of up to three years on certain domestic programs during his State of the Union speech Wednesday. Administration officials say the freeze should not effect the 2010 NASA budget and may actually receive a boost of $200 to $300 million.
Special Report: Obama's 2010 State of the Union
The current NASA budget is close to $19 billion, the Sentinel reports.
The budget, according to one administration official quoted, will tell Congress that NASA won't be able to design programs just to create jobs in their districts. "That's the view of the president," the official said.