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Space Launch Liability Indemnification Extension Act

Floor Speech

Location: Washington, DC


Mr. SMITH of Texas. Mr. Speaker, I yield myself such time as I may consume.

The bill we consider today provides stability for our Nation's commercial launch providers so that they can remain competitive in the international market.

The bill extends the existing system, which requires commercial launch providers to purchase insurance up to the maximum probable loss. It then provides that the government will compensate up to $1.5 billion, plus inflation, and any amount above that is the responsibility of the original commercial launch provider.

Two weeks ago, the Space Subcommittee heard testimony from industry experts about the need to extend the Commercial Space Launch Act's risk-sharing system. Two of the witnesses who testified deal with this law on a regular basis.

Mr. Stuart Witt, president of the Mojave Air and Space Port, is developing new launch systems and technologies that could revolutionize space by making it more accessible. He told the subcommittee that this law allows companies to continue to innovate and grow.

Another witness, Ms. Patricia Cooper, president of the Satellite Industry Association, represents companies that add billions of dollars to the U.S. economy as a result of the current risk-sharing system. Ms. Cooper testified that the system's continuation is ``absolutely essential'' and that her association ``strongly recommends that it be renewed before it expires.''

The committee also recently received a letter signed by DigitalGlobe, Boeing, Virgin Galactic, Lockheed Martin, American Pacific Corporation, Aerojet Rocketdyne, ATK, Ball, Honeywell, AMT II, and Orbital Sciences which advocated the renewal of the risk-sharing system in order to keep the U.S. competitive in the global market.

Last year, the Space and Aeronautics Subcommittee held a separate hearing on indemnification and heard from the Federal Aviation Administration, the Government Accountability Office, DigitalGlobe, and the Aerospace Industries Association. At this hearing, Frank Slazer, with the Aerospace Industries Association, summed up his trade association's position by stating:

Many foreign launch providers competing against U.S. companies already benefit from generous indemnification rules ..... We cannot afford to drive away highly skilled technical jobs to foreign countries, where the regulatory frameworks provide better critical risk management tools. Lastly, a nonrenewal could impede new U.S. entrants to the commercial launch market, discourage future space launch innovation and entrepreneurial investment. Without a level playing field for competition, new U.S. entrants could find it highly undesirable to begin their business ventures in the United States.

The FAA launch indemnification authority has been in place for over 20 years, and the American commercial space industry has benefited significantly over this time. Thankfully, the provision has never been triggered by a serious accident, but the stability it provides allows the U.S. to remain competitive in the global market and to push the boundaries of space technology.

The bill before us would extend indemnification for 1 more year with the hope that we can address a longer-term legislative solution. I would have preferred a longer extension. For instance, the NASA Authorization Act that the Science, Space, and Technology Committee passed last summer extended indemnification for 5 years, but we now have a bipartisan bill before us that provides stability to our commercial space industry by protecting companies against third-party liability claims.

This provision expires on December 31, so time is short. This bill buys us time to work on a long-term extension as part of the larger Commercial Space Launch Act renewal that we will take up next year. I urge my colleagues to support this bipartisan legislation.

Mr. Speaker, I reserve the balance of my time.


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