From: Rep. Calvert
Posted: Thursday, June 5, 2003
Intends to Promote Investment and Space Exploration
WASHINGTON, DC – Congressman Ken Calvert (R-CA) with Congressman Solomon Ortiz (D-TX) introduced legislation today that would grant tax credits to investors in the emerging commercial space launch vehicle industry.
"Today's bill represents a positive step forward in developing the United States' commercial space transportation industry and I would like to thank Congressman Ortiz for his dedication and hard-work on this legislation," said Rep. Calvert. "Companies that are now developing, designing and perfecting the next generation of space planes are embarking on a remarkable journey into the commercial frontier of space. Right now, the United States has an embarrassingly small percentage of the global commercial space industry."
The premise of the legislation is to encourage investment in companies, both large and small, that are creating cost effective, commercial Space Launch Vehicles (SLVs) and Reusable Launch Vehicles (RLVs). Currently, the United States is a very small player in the multi-billion dollar commercial space launch industry. The nations currently dominating this industry include China, Russia and France. The U.S. has led the world in space exploration and science, yet we are notably missing from this lucrative market. In order to get the emerging space transport industry off the ground in this country, the companies need an infusion of investment money. The federal tax this industry will generate in just 2 years after new systems are operational will more than pay for the tax credit.
In order to qualify, companies must demonstrate to the Secretary of Transportation that their approach is designed to develop a vehicle which can result in launch costs significantly below current levels and the possible commercial viability by raising a minimum of $5 million in equity capital.
"Our bill will allow a company, due tax credits in the first years of development, to pass those credits on through to the investors," said Rep. Ortiz. "Letting tax credits go through a company to their investors gives investors additional incentives to invest in broadening the commercial space industry."
"Giving tax credits to investors will make it financially feasible for the private sector to fund near-Earth, next generation vehicles," said Rep. Calvert.
At introduction this bipartisan legislation had 13 original cosponsors, including: Reps. Roscoe Bartlett (R-MD), Joe Barton (R-TX), Mike Burgess (R-TX), Randall "Duke" Cunningham (R-CA), John Doolittle (R-CA), Mark Foley (R-FL), Frank Lucas (R-OK), Ron Paul (R-TX), James Sensenbrenner (R-WI), Dave Weldon (R-FL), Lois Capps (D-CA), Ruben Hinojosa (D-TX), and Max Sandlin (D-TX).
For more information on the potential impacts to California please contact Janice Dunn, Director of Federal Government Affairs for the California Space Authority, Inc., at (805) 349-2633.
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