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Volume 2, No. 4                March 11, 1998

Only Chairman Bill Frist (R-TN) was on hand to oversee Thursday's hearing (3/5/98) on the commercialization of space -- a critical hearing to prepare for markup of the Commercial Space Act on March 12. Eight members of the Senate Commerce Subcommittee on Science, Technology and Space did not attend this hearing.

Three panels testified before the Senator.

Panel One

Senator Wayne Allard (R-CO), who represents the "two leading commercial remote sensing firms" in the U.S., urged the subcommittee to establish specific time frames for when the State Department and Defense Department must complete comments on license applications to export remote sensing technology. The House version of the Commercial Space Act sets 60-day deadlines, while the Senate version, authored by Senators Graham and Mack, has no clock.

Allard said "U.S. remote sensing companies face competition from other countries with major remote sensing programs, including Russia, France, India and Israel." He called the current system "arbitrary and capricious," and said "firms cannot attract customers with secure financing without placing predictable limitations on the amount of time they must wait for a response from the government."

Senator Bob Graham (D-FL) touted legislation to give "the federal government the authority to license commercial space re-entry activities." He highlighted a provision in his commercial space bill that "would require the Department of Defense to conduct an inventory of its range assets and determine what, if any deficiencies exist." In doing so, Graham explained we can then "convert our nation's launch ranges back to the busiest space facilities in the world." The Florida Senator also singled out legislation in his bill to allow the "conversion of excess ballistic missiles into space transportation vehicles." The rockets would be used to "launch small scientific and educational payloads that cannot afford the larger and more expensive rocket systems."

Panel Two
John Barker of the State Department, Keith Calhoun-Senghor from Commerce, Gil Klinger from the Department of Defense, and NASA General Counsel Ed Frankle provided government's perspectives on the Commercial Space Act. DOD and the State Department oppose the "60-day clock" for when they must complete comments on remote sensing licensing applications.

Calhoun-Senghor offered an observation on the growing complexity of licensing space systems. "Just as traditional lines between military, civil and commercial space are blurring," he said, "the growing international nature of space is also blurring lines between traditional national systems."

Additionally, he said "It is increasingly difficult to determine whether a SeaLaunch or a Globalstar is a U.S. system or something entirely new. And this trend will accelerate. The question of who is ‘us' will become a very relevant one, and has policy implications for purposes of regulation, licensing and trade."

Frankle focused primarily on two issues that "are of great importance to NASA's support of commercial space activity" -- cross-waivers of liability and indemnification. The issues are addressed in the NASA Authorization bill, which the subcommittee also plans to markup on March 12th. NASA is seeking legislation to clarify its authority to " waive claims of the U.S. government in its domestic cross-wavers." Without this authority, Frankle explained, "the commercial aerospace industry supporting NASA's aerospace activities could be placed at a competitive disadvantage vis-a-vis our international partners, since NASA clearly can waive these claims in international agreements but may not be able to provide the same level of assurance in wholly domestic activities."

NASA also is seeking indemnification authority for reusable launch vehicles and other NASA domestic R&D programs.

Panel Three
John Copple, CEO of Space Imaging, Micheal Kelly of Kelly Space and Technology, Robert Meuser of Kistler Aerospace, and Michael Swick, Executive Director of U.S. Global Positioning System Industry Council, filled out the final panel.

Copple reiterated positions offered by Senator Allard. Kelly attacked government policies that undermine private investment in commercial space launch systems. According to Kelly,"By funding programs such as the Evolved Expendable Launch Vehicle (EELV), and threatening to fund a commercial VentureStar, the government is actually impeding progress in the commercial launch system." He said the VentureStar, "while conceptually attractive as a commercial vehicle" is, in his opinion, "beyond us technologically." Kelly predicted private industry will not "be able to raise the capital required to do it."

Meuser emphasized the need for legislation to allow Commerce to license RLVs. Kistler has raised more than $200 million and wants to become a "trucking company" for space. Commercial operations are scheduled to begin in 1999. If legislation to license RLVs is not enacted, Meuser said Kistler will have to complete testing in Australia instead of developing a Nevada site. Swiek said the commercial GPS industry is now $2 billion and is expected to grow to more than $8 billion by the turn of the century.

About the NSS Capital Capsule
The Capsule is a timely report of highlights from Capitol Hill hearings and other events involving space issues. Prepared by NSS staff or volunteers who attend in person, the Capsule provides NSS members and activists an "insider's" look into the thoughts of our national elected officials on space issues.

The National Space Society is an independent, nonprofit space advocacy group with headquarters in Washington, DC. Its 23,000 members and 90 chapters actively promote the creation of a spacefaring civilization.

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