- Parabolic Arc
- June 2, 2023
AIA Policy Recommendations for Improving U.S. Space Competitiveness
Engine for Growth:
Analysis and Recommendations for U.S. Space Industry Competitiveness
Aerospace Industries Association
for Strengthening U.S. Space Competitiveness
1. Level the Playing Field
Provide a responsive regulatory environment for commercial space activities. The list of commercial space activities is varied and growing, ranging from traditional applications such as satellite telecommunications to emerging ones like space resource utilization. At the same time, the U.S. space industry is governed by multiple federal agencies with disparate regulatory interests, including the Federal Communications Commission, the Federal Aviation Administration and Departments of State and Commerce. These agencies often suffer from funding and staffi ng shortages, a situation that creates bottlenecks in licensing processes and slows responsiveness to technological and market changes. The new Administration should work closely with Congress to ensure that the appropriate space regulatory agencies are fully resourced and staffed.
Continuously review, update and improve export rulemaking and policies to reflect market and technological evolution. Export reforms adopted in 2014 were necessary to give U.S. industry a fighting chance against increasingly capable and aggressive foreign competition, but fell short and more needs to be done. Many space systems widely available on the international market from countries (including close U.S. allies) remain on the USML and are thus subject to restrictions that historically have been applied in an arbitrary and capricious manner. Space tourism vehicles are similarly classified, and, given the additional constraints imposed by the MTCR, are effectively limited to operating inside U.S. territory, depriving companies of potentially attractive markets for their services. The process put in place to regularly review the export classification of space items, while laudable, has so far proven incapable of keeping pace with industry advances. The government should examine this process to identify and eliminate bottlenecks.
Restore full functionality to the Export Import Bank of the United States. The Export-Import Bank was created to foster exports of U.S. goods and services through government-backed low-interest loans to overseas buyers. More than 60 nations, including Britain, Canada, China France and Russia have similar agencies. In recent years, loans either provided or backed by these agencies have become a staple of international trade in satellites, satellite technologies, and launch services; many if not most deals now require such loans. Ex-Im support for the commercial space sector averaged $1 billion in 2013 and 2014. Due to Congressional politics, however, the bank effectively has been sidelined since July 2015 and prohibited from underwriting new loans. Given that Ex-Im’s foreign counterparts remain very active in financing space deals, this exclusion amounts to unilateral disarmament in the global marketplace by our country. The new Administration should seek to insulate the Ex-Im Bank from politics and work with Congress to restore its ability to make loans large enough to support international space exports.
Ensure that tax reform supports U.S. space investment. Tax policies that benefit the U.S. space industry will pay large dividends for taxpayers by retaining jobs within the U.S., supporting national security, generating export revenues and enhancing competitiveness globally.
2. Expand Space Market Opportunities
Protect satellite spectrum. The frequency spectrum over which all radio signals travel is a congested resource, and in the digital age, there is increasing conflict as mobile wireless operators seek to expand their access, often time to the detriment of other services, including space and satellite communications. Yet, much of the data from satellite systems are the backbone of smartphone applications—weather, mapping, geolocation, etc. Recent International Telecommunications Union World Radiocommunication Conferences, a treaty-based international meeting of 190+ countries, have seen increasingly aggressive attempts by governments, including the U.S. led by the FCC, and wireless industry champions to constrain and restrict satellite use and growth, to expand terrestrial wireless access to frequencies already in use by satellite services.
Recent Federal Communications Commission (FCC) rulings also show a troubling trend toward disrupting globally harmonized satellite spectrum allocations, in favor of mobile wireless. The U.S. Government should strongly encourage a globally harmonized satellite spectrum policy, recognizing its importance through both the commercial and national space policy lens; it should work closely with its international counterparts for the most efficient and equitable allocation of this increasingly scarce resource, paying attention not only to current but also future satellite applications. In doing so, the government should always consider the potential importance of such policies on the U.S. space industry, whose services play a vital role in the economy, national security and public safety.
Preserve the orbital environment. The area where most space commerce takes place, near Earth orbit, is becoming increasingly congested. Orbital debris is becoming a significant problem, making space traffic management critically important. The danger was illustrated in 2009 when a commercial communications satellite collided with a spent Russian military satellite, creating thousands of pieces of dangerous orbital debris. To ensure a safe orbital environment, minimize the risk of debris-causing collisions, and provide certainty that satellites will be able to operate safely and profitably in the future, the government should continue to closely monitor the orbital environment and promote and incentivize efforts to minimize and even reduce the amount of hazardous debris.
Modernize US Missile Technology Control Regime (MTCR) restrictions to enable new, peaceful, international private sector space applications. Given new and emerging space systems, AIA recommends a thorough review of current U.S. MTCR rules. AIA believes that reasonable modifications to the existing rules could enable operations of U.S. commercial space vehicles at designated international spaceports that have proper technology security controls.
3. Prioritize Space Competitiveness as Vital to our Nation
Designate a senior U.S. government official as a commercial space advocate and make Space Competitiveness a priority for the National Space Council. Today, the government agencies involved in space activities advocate primarily on behalf of themselves in government-wide coordination and policymaking venues. The U.S. space industry currently has insufficient representation in these venues. Given that commercial space capabilities are closely intertwined with government activities, and given the strategic and economic importance of the sector, the Administration should appoint a dedicated senior official as the lead a commercial space advocate for the U.S. government. This position would manage interagency coordinating bodies, including a possible National Space Council chaired by the Vice President.
Leverage commercial capabilities to advance government missions. Agencies should, where possible, make use of expedited procurement rules for commercial space products and services and avoid developing systems and capabilities that are already available from the private sector. Although there will always be uniquely government missions for which there is no commercial solution, many can be effectively performed or supplemented by commercial capabilities. The Trump Administration should emphasize that government agencies, including the Department of Defense, should utilize commercial space services to the maximum practical extent.
Encourage enhanced leadership role for the Commerce Department’s International Trade Administration (ITA). ITA should play a greater role in fostering, promoting and advocating exports abroad for U.S. commercial space technologies and products. ITA can add value by developing measurable trade and export objectives to track progress. One specific idea would be to undertake a review of the organizational structure and effectiveness of the Commerce Department’s Office of Space Commerce as it relates to ITA and the National Oceanic and Atmospheric Administration (NOAA), and develop recommendations for improvements. NOAA has been given the responsibility to license imagery satellite exports, but does not have the structure or resources to adequately advocate for the growing space sector. ITA could utilize its existing organization advocacy expertise to further promote the sector.
Identify space security cooperation as a priority. Allied investment in U.S. military space capabilities reduces costs, promotes interoperability and provides new markets for U.S. industry. An example is the U.S. Air Force’s Wideband Global Satcom satellite communications system, where investments by close U.S. allies have expanded the size of the constellation while giving them global access. Increased space security cooperation can help to reduce the costs of procuring vital national security space systems while also strengthening the interoperability of US forces with our allies. The Defense Department should create an advocate for arrangements with allies similar to what is done with military aircraft within the office of the Air Force Executive Agent for Space.
The Office of Commercial Space Transportation (AST) should be adequately resourced to support a growing industry and moved out of the FAA but remain within the Department of Transportation. From a small operation licensing just a few launches annually at established launch ranges, AST’s responsibilities have grown with the industry. Today AST is challenged to obtain the resources needed to support a growing number of launch service providers, space ports and even crewed re-entry systems. At the same time, the FAA is busy supporting a burgeoning air transportation system, implementing its Next Gen Air Traffic Control System and integrating drones into the national airspace. Moving AST out of FAA will bring greater visibility to the vital work it is doing which is essential to enable new space capabilities to be come into service in a timely manner.
We must continue to invest in national security space recapitalization. Although commercial space already benefits national security and can improve resiliency and reduce costs, we must not forget the need to continually modernize and recapitalize our dedicated national security space capabilities. Virtually every U.S. military operation today depends on space capabilities and many of these are supported by uniquely military systems. There is no commercial market for protected military satellite communications, national security surveillance capabilities and highly secure, jam-resistant global positioning. If we are to assure U.S. national success in military operations and deterrence, these continued governmental investments are essential.
National Security and civil space technology research and development need more investment
It has long been recognized that long term, high risk advanced technology research and development investments by the U.S. government have been key to the nation’s leadership in many fields. Unfortunately, funding for space technology research and development has stagnated or fallen in recent years due to reductions in federal defense and civil space spending imposed by the Budget Control Act of 2011. AIA encourages the Administration and Congress to provide adequate resources to maintain leadership in these vital technologies.
4 responses to “AIA Policy Recommendations for Improving U.S. Space Competitiveness”
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Looks good. Never happen.
Maybe it will. A lot of it is just common sense.
Which is why it won’t happen. We are talking about politicians here…
“Ensure that tax reform supports U.S. space investment. Tax policies that benefit the U.S. space industry will pay large dividends for taxpayers by retaining jobs within the U.S., supporting national security, generating export revenues and enhancing competitiveness globally.”
Looks like California won’t be listening to their good advice….
California plans for collecting taxes on spaceflight
By Dominic Fracassa
May 3, 2017 Updated: May 3, 2017 6:10pm
“But the board says it created the rules to give entrepreneurs the confidence that once their businesses really start to take off, California’s tax code will be ready to handle them.”
Translation – Yes, entrepreneurs, as soon as you make money in space we will be there to take it…
The California Franchise Board philosophy – If it moves – Tax it. If it doesn’t move – Tax it at a higher rate 🙂