Index Association Seeks Insurance Solutions for Aerospace Needs AIA Seeks Aircraft Support AIA Objectives Met at ICAO The President's WASHINGTON PIPELINE: Three Critical Aerospace Technologies Can Bolster U.S. Economic Strength Washington Watch: After Rapid Initial Response to Terror, Key Issues Are Stalled Orbital Sciences Group Joins AIA U.S. Aerospace Companies and Workers Answer Call for Help with Cash, Blood Drives, and Technologies AIA’s Siegel Chairs Standards Meeting AIA Acts to Protect Contractor Pricing Information

Association Seeks Insurance Solutions for Aerospace Needs

Attempts in Congress to develop a short-term solution for the insurance industry to ensure coverage for aerospace industry companies in future terrorist acts have proven difficult.

Congress and the administration are trying to develop a program to "backstop" the insurance industry before the January 1 renewal deadline for most insurance policies.

As AIA Update went to press, there were four separate legislative proposals in development.

One crafted in the Senate Banking Committee appears to have tentative endorsement from the administration.

In the House, the breakdown of support between two differing proposals is along party lines. In the Senate, two committees — Banking and Commerce — are preparing rival approaches to avert the pending insurance crisis.

AIA supports rapid action on the insurance issue along with federal support for claims arising from future either international or domestic acts of terrorism.

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AIA has urged President George W. Bush to approve additional funding for the purchase of commercial aircraft for use in various military support roles.

John W. Douglass, AIA president and CEO, in a letter to the president in November said the United States has "a rare opportunity to modernize military support aircraft needed for the war on terrorism and at the same time provide the civil aviation industry a much needed economic stimulus."

He added that the "severe and sudden contraction of the market for civilian aviation products," coupled with Defense Department’s pressing need to modernize its support aircraft fleet made it an ideal time to replace aging tanker, cargo, medical evacuation, and electronic surveillance aircraft.

Plans to modernize have been on hold due to a shortage of funding.

Douglass urged the president to "send a clear signal to the world that America values its economic and military security while giving much needed hope for the hundreds of thousands of aerospace workers whose jobs are threatened in this national crisis."

He further asked the president to carefully consider this issue as he approves FY 2002 legislation for DoD and finalizes his FY 2003 budget proposals for national defense.

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The Assembly of the International Civil Aviation Organization (ICAO) adopted resolutions to establish international approaches on noise management and emissions issues and increase safety and security of international civil aviation as it concluded its 33rd session in Montreal last month.

AIA representatives were among the record 1,130 participants from 169 ICAO member nations.

Highlights of assembly action included:

• Creation of a balanced framework for noise management.

• Establishment of a cost-benefit analysis as the basis for evaluating measures to reduce aircraft noise and emissions.

• An expanded safety oversight program.

• Creation of a voluntarily funded International Financial Facility for Aviation Safety (IFFAS).

On security, the assembly endorsed a resolution calling for an international high-level ministerial conference as soon as possible to develop measures for "preventing, combating, and eradicating acts of terrorism involving civil aviation."

In the area of environmental protection, all of AIA’s objectives for the assembly were achieved, including a cost-benefit analysis as the basis of ICAO decision making, no phase-out of U.S. Stage 3 aircraft, an international framework for noise management, and an aggressive work program for addressing emissions at source and through market-based approaches.

The key in reaching final agreement on the environmental resolution was inclusion of language acknowledging that states have "legal obligations, laws, existing arrangements, and established policies that may govern management of noise problems and that could affect implementation of the internationally agreed balanced approach."

AIA has held that states should work within ICAO to develop internationally accepted standards and recommended practices and adopt the ICAO framework.

Discussion of enhancing ICAO standards centered on the problem of keeping standards and recommended practices and procedures simple, clear, and concise.

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In aerospace, the difficult news of the present — layoffs and declining sales of civil aircraft — has overshadowed some very good news for the future.

Three critical technologies under development by U.S. aerospace companies — the Joint Strike Fighter, the Sonic Cruiser, and an assortment of unmanned aerial vehicle programs — promise to help maintain the health and leadership of the industry in the global economy for the next several decades.

With the Joint Strike Fighter (JSF) decision in place, the course has been set for fighter aircraft for the next 20-30 years along with assurances that the United States will have an affordable, multi-purpose stealth aircraft.

The JSF will be of enormous benefit to U.S. military services, which are expected to purchase approximately 3,000 aircraft, and it will almost certainly become the fighter of choice for our allies. Many countries will replace older fighters over the next two to three decades, and the JSF promises to be lower in price and superior in performance to any fighter in its class.

As other countries purchase the JSF, they will assure interoperability with U.S. forces during coalition warfare or peacekeeping missions. Furthermore, defense exports such as the JSF will reduce the unit cost to the U.S. military, create jobs at home, and strengthen our industrial base.

In the civil aviation sector, the Sonic Cruiser will allow the United States to offer the world’s airlines a commercial transport that is substantially different than current generation civil airliners.

The Sonic Cruiser would be a qualitative leap forward in passenger transportation, traveling just under the speed of sound and shaving as much as three hours off routes between the United States and Asia.

Flying at altitudes above current passenger air traffic, the Sonic Cruiser will avoid route delays of current generation aircraft and provide a basis for a new family of aircraft of varying sizes to service transcontinental and intercontinental routings.

The leap forward in technology of sonic cruisers will redefine business travel in dramatic fashion and holds the promise of opening point-to-point travel around the world that will bypass the crowded hubs of today’s civil aviation structure.

In another area of expanding importance, U.S. companies are already ahead in developing and operating unmanned aerial vehicles (UAVs) and remotely operated aircraft (ROA) — a field that could well provide the ultimate successor to the JSF.

Unmanned, remote-controlled technology will be of extraordinary importance to the battle space of the future. These craft will be able to endure reconnaissance missions and tolerate the stresses of combat much better and more safely than human pilots, giving new assets to the United States and its allies to maintain air superiority.

After proving themselves in military applications, UAVs and ROA will almost certainly find important niches in commercial applications as well. From mapping terrain to patrolling for forest fires, pilotless aircraft will be used in any hazardous reconnaissance where it is dangerous to put a human being.

The government and private sector will play critical roles in determining whether the United States will move out smartly in all three technologies. Remember, too, that advances such as these will help the aerospace industry attract and retain the best and brightest engineers and aerospace workers.

By moving ahead with these programs, the nation can be confident that it will retain its position as the preeminent producer of commercial, military, and unmanned aircraft for decades to come.

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Following rapid passage of supplemental spending, airline relief, and anti-terrorism legislation in a matter of days following the September 11 terrorist attacks, Congress and the administration have since become mired in a range of controversies.

The disputes have delayed further action on the budget appropriations legislation for FY 2002 as well as on numerous urgent legislative proposals to address the consequences of the terrorist attacks.

In addition to slowing action on the final appropriations bills, lawmakers also stalled on the economic stimulus package and legislation to provide federal support for private insurers against terrorism.

After considerable wrangling, Congress in mid-November passed a compromise bill that overhauls the nation’s aviation security system.

Although progress has been made on some of the appropriations bills in the last month, Congress has made little progress on the defense bill.

The House Appropriations Committee began its markup of the FY 2002 defense appropriations bill on October 10, but then suspended work over disagreements concerning an additional $20 billion for September 11-related spending that the committee intends to attach to the bill.

The administration has attempted to hold the line at the $55 billion supplemental spending for 2001 already approved by Congress. At press time, controversy reigned among the House and Senate leadership, the appropriations committees, and the administration concerning the final size and content of the September 11 supplemental spending package.

After disagreements slowed action on the airline security bill, lawmakers finally worked out a compromise that the president signed just before Thanksgiving. Many provisions, however, don’t take effect for months and won’t be easy to implement.

For instance, all airports are to adopt a federal baggage-screening system within a year. A year later, five airports could hire private contractors to screen baggage. After three years, airports would choose hiring either private or public screeners.

The bill also includes a provision supported by the administration and AIA that provides liability protection for aircraft manufacturers from injury claims from the September 11 attacks.

And it strengthens cockpit doors, puts sky marshals on flights, and grants wide authority to a transportation security official.

The House passed its version of an economic stimulus package on October 24. It contains $99 billion in tax cuts and other mechanisms to counteract the impact of the September 11 attacks.

AIA supports provisions that would provide for 30 percent depreciation of assets in the first year and extend the net operating loss carry-back period from two to five years.

The Senate is attempting to develop a consensus package that can garner sufficient votes to get out of the Senate Finance Committee, but achievement of that goal is proving elusive.

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Orbital Sciences Corporation’s Advanced Program Group is AIA’s newest member.

The company is a leading manufacturer of low-cost space systems, including launch vehicles, satellites, advanced space systems, and satellite-based transportation management systems.

Founded in 1982, Orbital is headquartered at Dulles, Virginia, and has operations in the United States, Canada, and several international locations.

The Advanced Programs Group is developing innovative technologies and exploring new businesses that could figure prominently in the company’s future.

To help Orbital stay at the forefront of the small launch market, for instance, the firm is building the X-34 rocketplane as a test platform for reusable launch technologies. Also, Orbital is participating with other aerospace industry companies in major space transportation studies for the U.S. government.

Orbital has built and delivered more than 85 satellites, which have amassed more than 300 years of successful in-orbit operations.

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American aerospace companies and their workers have a heritage of helping people in need and standing arm-in-arm for America.

The terrorist-driven tragedies of September 11 killed thousands of innocent people in New York, Washington, and Pennsylvania and left hundreds of injured victims and rescue workers, thousands of broken families, drained fire and police resources, and a huge need for blood, cash, and other aid.

Not surprisingly, the men and women of the member companies of the Aerospace Industries Association (AIA) were in the forefront when the nation rolled up its sleeves and answered the pleas for help.

Some aerospace companies loaned or donated high-technology search and rescue products for locating possible survivors at the World Trade Center ruins. Others gave the use of corporate aircraft for victims’ families, rescue workers, and supplies. Many gave grants or matched cash donations and provided space and manpower for blood drives.

Individual aerospace workers offered their prayers, blood, and money. Many pledged that their professional work would be at the highest level of quality to assure full product and logistical support for the men and women of the military services risking their lives in battle for justice against terrorism.

"Aerospace companies and workers have always answered the call when America has been attacked," noted John W. Douglass, AIA president and CEO. "When terrorism disrupted our nation in September and threatened world order, aerospace and defense companies and employees jumped up to help."

"When we look at how the nation responded in the aftermath of 9-11, we are each proud to be an American," Douglass noted, adding "and seeing how our industry responded, I can say further that I am proud to be an American aerospace worker."

AIA asked its member companies for reports of how they and their employees answered the calls for help. Here is a summary of some of those support efforts:

AAI employee donations were matched dollar-for-dollar by Maryland firms, raising more than $12,500 that was given over to the local American Red Cross chapter. In addition, a large number of AAI employees donated blood through local collection sites.

AGI contributed $12,000 to the New York Firefighters 9-11 Disaster Relief Fund to help the families of fallen firefighters and EMS personnel. The donation was made on behalf of the company and its employees.

In addition, AGI is responding to the current battle against terrorism. The com-pany is significantly contributing to the effort’s front lines by providing its STK software and technical services to key agencies involved in national security.

The BAE Information and Electronic Warfare Systems division rushed infrared sensors through production so they could be used in the effort to find survivors in the World Trade Center rubble. Several infrared cameras used by the New York City Fire Department were lost when the towers collapsed on the firefighters within, creating a desperate shortage of cameras for those working to find trapped victims.

BAE, which makes the core of the cameras, said volunteers manned the operation around the clock to get the job done. Several workers and extra equipment were shifted from other projects to quickly produce between 200 and 300 cameras for the New York effort.

Boeing company and employee contributions for humanitarian efforts surpassed $7.5 million. In addition, Boeing donated satellite transponder time to the Federal Emergency Management Agency to aid in "Ground Zero" communications support in New York. An additional transponder was donated to aid in the broadcast of the nationally televised fund-raising telethon.

Further, Boeing supported the broadcast of "A Concert for America" from the Kennedy Center in Washington, D.C., that aired on PBS stations across the United States. This special performance, with music from the National Symphony Orchestra, benefited the United Way September 11th Fund and was attended by approximately 600 family members of the victims of the Pentagon terrorist attack.

Boeing employees were encouraged to participate in blood drives scheduled at Boeing sites through the Boeing Lifeline program.

Cubic gave $25,000 to the United Way September 11th Fund, and Cubic employees contributed individually to the United Way and American Red Cross. The firm also donated $5,000 to the San Diego Blood Bank to help cover costs of collecting, testing, and shipping 380 units of blood to New York to assist victims of the attacks there.

Goodrich established an employee Web site for online donations to the American Red Cross and Salvation Army, speeding the donation process and enabling corporate matching. The Web fund topped $100,000 for the American Red Cross with $25,000 earmarked for New York police and firefighter family support. In addition, Goodrich gave some $200,000 to disaster relief efforts.

Hamilton Sundstrand employees in Windsor Locks, Conn., collected more than 4,000 gallons of bottled water for Salvation Army relief efforts. The company also invited the American Red Cross to host a blood drive in the Windsor Locks plant. Rockford, Ill., employees printed thousands of emergency response training manuals for the Red Cross. The Phoenix, Ariz., facility held a blood drive with 25 percent of the employees participating.

Hamilton Sundstrand’s parent firm, United Technologies Corporation, established a Disaster Relief Fund in support of the American Red Cross. The program matches dollar for dollar donations between $25 and $100. Hamilton Sundstrand employees contributed some $44,000 toward the match.

Lockheed Martin made individual and corporate donations totaling $1.7 million to Lockheed Martin’s American Spirit Fund to be given to relief organizations helping injured survivors and families.

In addition, seven Lockheed Martin engineers spent a week at Ground Zero training rescue crews in the use of the Human Search and Rescue Radar. The equipment detects human breathing motion as far away as 15 feet, even through thick concrete slabs.

Systems Support and Training Services (SS&TS) teams helped the U.S. Environmental Protection Agency (EPA) monitor disaster sites for potentially contaminated dust and debris.

Lockheed Martin employees also were engaged in round-the-clock efforts to restore the communications infrastructure at the Pentagon — even while fire fighting and rescue efforts continued.

Northrop Grumman and its foundation contributed $1 million to the relief efforts for the victims and families of the terrorist attacks as well as to the firefighters and police who dealt with the aftermath.

Funds went to the International Association of Fire Fighters, the New York Fraternal Order of Police World Trade Center Funds, the September 11th Fund of the United Way and New York Community Trust, and an employee assistance fund for Northrop Grumman staff directly affected by the tragedy.

Raytheon and its employees at facilities worldwide rallied to support September 11 relief efforts. So far, more than $900,000 has been contributed, including contributions from the company and the Raytheon Employee Disaster Relief Fund to the American Red Cross.

In addition, an education trust fund was established to benefit the children of the four employees lost in the tragedy.

Raytheon also gave assistance with in-kind gifts. Raytheon Aircraft flew special lifeguard missions and sent 25 infrared cameras to New York City’s emergency response teams.

To encourage continuous employee giving, the company introduced a new option to allow its employees to make contributions through payroll deductions to the American Red Cross, the United Way September 11th Fund, and the Raytheon Employee Disaster Relief Fund.

Spectrum Astro is helping a variety of Arizona and national organizations with donations that exceed $100,000. In addition, Spectrum Astro employees raised $15,532 for the American Red Cross, and the company matched it to both the American Red Cross and the United Service Organizations (USO), which is providing relief to the families of the Pentagon attack.

Triumph Group matched employee contributions dollar-for-dollar and raised more than $61,500. The money was earmarked to the AmeriCares Heroes’ Fund to be distributed to spouses and children of New York City firefighters, police officers, and Port Authority employees who perished in the tragedy.

AmeriCares is a nonprofit disaster relief and humanitarian aid organization that responds to emergency medical needs and supports healthcare programs around the world.

TRW has contributed $100,000 to the Red Cross and an additional $400,000 for U.S. relief efforts, half of which will be distributed to the American Red Cross and the other half to the September 11th Fund, created by United Way of New York City and the New York Community Trust in response to the pressing needs of the victims and their families.

TRW has also created a special match of employee gifts to the Red Cross up to a total maximum of $100,000.

Woodward Governor made a $50,000 donation to the September 11th Fund to aid communities affected by the terrorist attacks.

In addition, Woodward workers participated in local blood drives, United Way campaigns, and other activities to support those involved with the tragedy.

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AIA had a leading role in a key meeting last month of the International Organization for Standardization (ISO).

Stan Siegel, the association’s vice president of technical operations, chaired the 38th plenary meeting of the ISO technical committee that coordinates international standards for aerospace — ISO/TC 20, Aircraft and Space Vehicles.

The session in Berlin was attended by more than 25 delegates from eight countries.

Highlights included development of a new working group to address integrated data processing materials management and a final review of the committee’s draft business plan.

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AIA is leading an effort to block sensitive proprietary contract information from being posted on a government Web site.

Earlier this year it was learned that the Defense Logistics Agency (DLA) was posting contract award announcements, including unit prices, on its procurement Web site.

Many companies consider contract unit prices confidential information protected under the Trade Secrets Act and Exemption 4 of the Freedom of Information Act (FOIA).

AIA in August objected on behalf of association members against the practice of posting prices without contractor permission. DLA defended its procedures as being consistent with Defense Department (DoD) FOIA policy.

The association last month again protested and pointed out a court decision from another industry in which the judge ruled that unit price information is protected from disclosure under the Freedom of Information Act. DLA hasn’t responded.

However, DoD recently told DLA that the Justice Department has advised it that contractors should be notified whenever an agency receives an FOIA request for documents containing contract unit prices.

AIA is optimistic that DoD’s action will prompt DLA to curtail posting unit price data.

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