U.S. Aerospace Commission Votes to Issue Interim Report in March

Press Release From: Commission on the Future of the United States Aerospace Industry
Posted: Thursday, February 14, 2002

Report Will Include Recommendations in the Areas of Investment, Air Infrastructure and Export Controls

WASHINGTON-During its second public meeting on February 12, the Commission on the Future of the United States Aerospace Industry decided to issue its second interim report in March 2002 to address issues of immediate importance to the industry. The Commission voted to include recommendations regarding aerospace investment, air capacity and export controls in Interim Report #2 to be released in March. The Commission conducted its meetings in the U.S. Department of Commerce Auditorium.

"After months of gathering information and hearing testimony from expert witnesses, the Commission felt there were some action items that warranted immediate attention," said Chairman Robert S. Walker. "The second interim report will focus on three areas vital to the health of the industry and recommend steps that Congress should take in the near term to positively impact the long-term outlook of the industry."

The Commission received testimony from both industry and government representatives in the areas of air transportation capacity and infrastructure and export controls. Commissioner Heidi Wood presented the investment recommendations she spearheaded along with Commissioner Bob Stevens, Commissioners Ed Bolen and John Douglass proposed interim findings and key recommendations regarding air capacity and infrastructure, and Commissioners John Hamre and Bill Schneider led the discussion and recommendations on export controls. At the meeting's conclusion, the Commission decided to release an interim report based on the following proposed draft recommendations:

Aerospace Investment

1) Make Research and Experimentation (R&E) Tax Credit permanent and on a par with other sectors.

2) Implement Shared Savings for Cost Efficiencies and Rationalization.

* Incentivize contractors through cost savings retention, endorsing strategy under DOD consideration

3) Seek long-term resolution for Foreign Sales Corporation/Extra-Territorial Income Exclusion Act of 2000.

Air Traffic Capacity and Infrastructure

1) Immediately create a multi-agency coordinating council with the leadership responsibility and authority to implement an integrated plan to reach the national objective of moving air capacity substantially ahead of anticipated demand.

2) Ensure robust FY03 and future NASA and FAA R&D funding to continue current modernization efforts and provide the critical building blocks for the future, such as small aircraft transportation systems, noise and emissions reduction, Air Traffic Control (ATC) automation, and CNS (Communication, Navigation and Surveillance).

Export Control Reform

1) Revive U.S. bilateral negotiations with Australia and the UK to create a set of ITAR (International Traffic in Arms Regulations) exemptions from the munitions licensing system.

2) Update country risk surveys of major export destinations for munitions list exports.

3) Accelerate the implementation of electronic licensing for the munitions licensing system and ensure system interface compatibility.

4) Reduce regulatory barriers to the implementation of global/program/project licensing under the Defense Trade Security Initiatives (DTSI).

5) Modernize the Defense Export Loan Guarantee (DELG) Program to facilitate the unsubsidized export credit financing of U.S. defense exports to United States allies and friendly nations.

The Commission on the Future of the United States Aerospace Industry is a congressionally mandated commission, as established in Section 1092 of the Floyd D. Spence National Defense Authorization Act for Fiscal Year 2001, Public Law 106-398. The Commission was formed to study the future of the United States aerospace industry in the global economy, particularly in relationship to United States national security; and to assess the future importance of the domestic aerospace industry for the economic and national security of the United States. The next public meeting of the Commission is scheduled for May 14, 2002 in the Department of Commerce Auditorium.

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