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 AIA UPDATE: March 2006, Volume 10, No. 6
Raytheon Will Rocket TARC Winners to Farnborough to See Applied Aerospace Skills A trip to the Farnborough International Air Show near London in July awaits the Fourth Annual Team America Rocketry Challenge (TARC) winning team, courtesy of AIA member Raytheon Company. The trip, which will be in addition to the winners' share of some $60,000 in savings bonds and cash, will give the victorious students an up close look at applied aerospace engineering, a skill the contest is promoting, AIA President and CEO John W. Douglass said. "TARC is a great way to introduce these kids to aerospace through the challenges of engineering a model rocket," Douglass said. "Taking the winners to Farnborough will show them what these lessons lead to in the real world." The world's largest rocket contest, TARC pits teams of between three and 15 middle and high school students in a challenge to build and successfully launch a model rocket without breaking a raw-egg payload. The goal is to launch the rockets as close as possible to 800 feet in altitude and 45 seconds in flight duration. The final round of competition is scheduled for May 20 at Great Meadow in The Plains, Va. "Rewarding the TARC winners with a trip to Farnborough is right in line with Raytheon's emphasis on promoting math and science education among young people through our MathMovesU initiative," said Raytheon Executive Vice President for Business Development Thomas M. Culligan. "We hope that this will help motivate the winners and all the competitors to stick with science and math and ultimately pursue a career in aerospace." The Farnborough International Air Show is one of the largest and most prestigious aerospace events in the world. It includes flying demonstrations of civil and military aircraft from around the world as well as static displays from thousands of aerospace companies. Raytheon's sponsorship will pay for four students and one adult chaperone, including air fare, lodging, a company tour, and a TARC champion recognition dinner. The winning team will attend the air show on Farnborough's International Youth Day, a program for 1,000 invited students between the ages of 15 and 23 aimed at attracting youth who show promise in areas that could lead to aerospace careers. Activities will include a build-a-plane project, test spins in aircraft simulators, and presentations by test pilots, scientists, and journalists. In addition to commercial, business, and military aircraft, the air show includes special displays on space products and unmanned aircraft systems. TARC is sponsored by AIA and the National Association of Rocketry, the nation's oldest and largest non-profit organization dedicated to sport rocketry. The contest is co-sponsored by 39 AIA member companies, NASA, the Defense Department, and the Civil Air Patrol. AIA Source: allison.harvey@aia-aerospace.org AIA Preparing Space Exploration Info Toolkit AIA's Space and Legislative departments are producing a topical guide to the nation's space exploration initiatives for briefing Congress, industry, and trade press on the long-term economic and national security benefits generated by key NASA programs. The space information kit will include one-page summaries that provide updated information on NASA's budget relative to other federal programs, the technological spin-offs created by space exploration hardware and software, the increasingly aggressive foreign competition in the space arena, and the environmental value of the agency's network of Earth science satellites. AIA plans to circulate the toolkit among a broad congressional audience to deepen legislators' understanding of the benefits of the U.S. space program to Americans. Space briefings, for example, highlight the fact that for less than one percent of the federal budget, NASA programs have produced critical technological advances in health care, air transportation, and public safety applications. The kit, which AIA members will eventually be able to download from the association's Web site, also documents the growth of human space flight and satellite deployment efforts by China, India, Russia, and the European Union. AIA Source: patrick.mccartan@aia-aerospace.org AIA Legislative Affairs VP Jon Etherton Announces Departure 
AIA Vice President of Legislative Affairs Jonathan L. Etherton is leaving the association this month to establish his own consulting and government relations firm in Washington.A successor hasn't yet been named. "My seven years at AIA have been among the most exciting and fulfilling of my professional career," Etherton told AIA President and CEO John W. Douglass in his letter of resignation. "I am very proud of our accomplishments on behalf of the United States aerospace industry." Describing his reaction to the decision as bittersweet, Douglass praised Etherton's contributions and said, "My feelings of loss are only comforted by the knowledge that Jon is taking advantage of a wonderful opportunity that will serve him and his family well in the years ahead." Etherton joined AIA in 1999. Earlier, he was a Senate staff member, including 14 years with the Armed Services Committee. Much of his congressional work involved acquisition and contracting matters. At AIA he led a team of legislative representatives in resolving an array of aerospace and defense industry issues. In 2005 Etherton was named to the list of leading trade association lobbyists in Washington by The Hill, a highly respected Capitol Hill newspaper. He also was appointed by the Bush Administration to the Services Acquisition Advisory Panel to review federal contracting laws, regulations, and policies. Looking back, Etherton cited the association's leadership in helping establish the Commission on the Future of U.S. Aerospace Industry in 2001 as a key milestone of his AIA tenure. "That effort has led in turn to the ability of AIA to stay in the center of the congressional debate of the issues, such as trade and acquisition reform," he noted in his letter to Douglass. AEROSPACE FOCUS  WASHINGTON PIPELINE: President's Budget Would Strengthen Defense and Space By John W. Douglass, AIA President and Chief Executive Officer When the administration released the president's proposed fiscal 2007 budget and the Quadrennial Defense Review in February it ended months of speculation as to what destiny they would offer for major aerospace and defense programs. As is the norm in Washington, doomsayers were in full force, predicting deep slashes in long-established programs to deal with short-term pressures on the federal budget. While they got plenty of attention in the media, the proponents of draconian defense cuts turned out to be absolutely wrong. As it turns out, the budget and the QDR both maintain funding support — for the most part — of important long-term defense programs, even increasing the investment in some cases. If you consider the unique challenges of the ongoing war on terror, it is easy to see why. While tactics on the ground have changed to meet a much different type of enemy, the U.S. military still needs newer advanced technologies today than those that were developed more than 25 years ago during the Cold War. These include the pinpoint accuracy of precision strike weapons, strategic airlift to quickly move troops and supplies, tactical fighters to ensure air superiority, advanced submarines and ships to control the seas, and unmanned systems for stand-off intelligence gathering, targeting, and weapons delivery. The budget proposal and the accompanying $50 billion supplemental request reflect those realities, recommending a 7 percent increase overall for the Defense Department. No major weapons system is eliminated, a possibility that many pundits all but guaranteed before the budget came out. In addition, the research and development budget increased 3.4 percent. An important outcome of the budget proposal is what isn't in it — funding for ongoing military operations in Iraq, Afghanistan, and other military activities around the world. By continuing the strategy of asking Congress for supplemental funding for the on-going war against terrorism, the administration is avoiding the prospect of extraordinary financial needs sapping resources necessary for long-term strategic aims. It would have been easy to cancel a program, as the shortsighted pundits suggested, and apply that money toward other national priorities. But the administration was wisely focused on the nation's future security, understanding that no one knows exactly what our future threats will be. Also, the president's budget proposal provides a modest increase of $169 million in NASA's exploration funding to maintain U.S. preeminence as an international space power. But as the administration moves forward with the nation's new plan to revisit the moon, the agency's budget will have to include clear and achievable milestones for the development of a new vehicle to replace the space shuttle. One significant disappointment in the budget proposal is in NASA aeronautics research funding, which would be cut by $178.3 million or 20 percent. The proposed decrease is especially disheartening given the president's strong words on American competitiveness in his State of the Union address. Along with restoring appropriate funding to NASA aeronautics, the United States must develop a national policy that cements the importance of aeronautics to our national economy and stops the continuing decline in competitiveness. As we all know, the budget process for fiscal 2007 is just out of the gate. AIA is championing the best recommendations from the administration while trying to convince lawmakers to increase investments where needed, such as in aeronautics research and development. Hopefully, we can take a very good proposal and make it even better. WASHINGTON WATCH: SMC Champions Small Business Health Plan AIA's Supplier Management Council plans a spring advocacy campaign in the U.S. Senate on behalf of the Small Business Health Fairness Act. The bill, S.406, which the House of Representatives passed last July, would authorize small business to form multi-state, multi-service association health plans. In recent years, thousands of small businesses have experienced health care premium increases between 15 and 30 percent, a significant burden because this sector of the economy accounts for approximately half of the nation's uninsured workers. Factors such as administrative overhead and underwriting expenses also consume up to a third of small business health care costs in contrast to an average level of eight percent for larger employers. The association health plans envisioned by the bill, however, would finally permit small businesses to become competitive in the medical marketplace by offering the advantage of access to affordable packages that include a variety of services. In taking their case to the Senate, supplier council members will argue that the bill would improve their negotiating position with health care providers, capture high-volume discounts, and spread processing costs across a nationwide base of participants. Ultimately, the market-based solutions of the legislation would relieve small businesses from the grim choice of canceling employee health care coverage or operating at consistent annual losses. The Senate might consider the bill before the congressional mid-term elections in November. AIA Source: patrick.mccartan@aia-aerospace.org
WASHINGTON WATCH: Annual Report on Defense Offsets Out The U.S. Department of Commerce recently published its 10th annual report to Congress on offsets in defense trade. It again shows a net positive impact of 4,326 work years on U.S. defense jobs from foreign sales balanced against associated offset commitments. Most foreign governments, when purchasing defense equipment from offshore, demand that sellers provide economic benefits that help "offset" a portion of an item's cost and make the purchase more politically acceptable, such as purchases of products from the buying country, technology transfer, and training and investment. There have been questions raised in the past about the net impact of offsets. On one hand, fulfilling offset commitments as part of a sale might entail transfer of pieces of work on defense equipment to the purchasing country. On the other hand, the foreign sale associated with the offset often keeps open entire production lines. If the use of offsets is to be regulated, it will have to be done through multilateral agreements. Unilateral actions by the United States would only shift demand for defense products away from U.S. manufacturers. AIA Source: remy.nathan@aia-aerospace.org Aerospace Research Center: Proposed Federal Budget Analyzed to Determine Impact on Industry President Bush last month sent Congress the proposed fiscal 2007 federal budget. AIA's Aerospace Research Center has created the accompanying table to summarize the requested funding for a number of agencies and departments. First, while DoD's research, development, test, and evaluation account is set to increase $2.4 billion to $73 billion, procurement funding will decline $2 billion to $84 billion. Delving deeper, aircraft procurement is proposed to rise $0.6 billion while missile and other procurement categories combined are set to decline $0.8 billion and $1.8 billion, respectively. Second, resources available to the Homeland Security Department appear to be substantially increasing, but Katrina-related funding and rescissions distort results. Science and technology funding will be cut 33 percent to $1 billion, and Transportation Security Administration funding will drop 40 percent to $2.5 billion with airlines picking up the tab. Third, NASA's budget is set to increase a mere one percent to $16.8 billion. Implementing President Bush's vision for the agency and the country, exploration funding is set to increase, but that growth would come at the expense of aeronautics and capabilities funding. Proposed funding falls far short of levels AIA recommended in its second 5-year R&D plan. Fourth, FAA funding decreases $143 million to $13.7 billion. Operations spending is set to increase to $8.4 billion. Airport grants-in-aid decline 11 percent to $2.7 billion and facilities and equipment investment is set to decline $52 million. Research, engineering, and development also declines. Reduced funding for modernization postpones long-term economic benefits yielded by an efficient transportation system, but we are encouraged that the Joint Planning & Development Office budget to develop the Next Generation Air Transportation System continues to increase.
[ ]=included above AIA Source: david.napier@aia-aerospace.org Aerospace Industry Workforce Expanded by 21,400 Jobs Last Year The aerospace industry, including instrument manufacturing, expanded its workforce in 2005, adding 21,400 jobs to its payrolls, including 7,300 in the last two months of the year. Aerospace employment totaled 626,300 in December, up from 604,900 a year earlier and an increase of nearly 47,000 since reaching a 50-year low in February 2004. It is estimated that approximately one in three new U.S. manufacturing jobs were created by growth in the aerospace industry since it hit its low in 2004 in spite of the fact that only one in 23 manufacturing workers was employed in aerospace, according to the year-end figures. The new positions represent well-paying jobs. For example, aerospace production workers earned $23.89 per hour on average in 2005, compared to $16.56 for all manufacturing industries. It also supports Defense Department initiatives.  Getting the Lead Out Recent environmental regulations are forcing commercial electronics companies to move toward lead-free solder and coating. Because these companies provide most of the electronics components used in aerospace systems, the aerospace industry is working on ways to function in a lead-free environment. Electronic systems in aircraft have traditionally relied on lead-based solder and plating for a variety of electrical components and connections. Experience has shown that lead-based solders and coatings can handle the extreme stresses in aerospace and military environments. The European Union has enacted two directives that restrict or eliminate various substances in a variety of products produced after July 2006. One of the materials restricted is lead. The Lead-free Electronics in Aerospace Project Working Group is addressing the issue through a coalition aimed at raising awareness of the impact that the EU directive has on aerospace and military electronics and avionics. The working group is developing standards and handbooks for guidance. It's a joint activity of AIA, the Avionics Maintenance Conference, and the Government Electronics and Information Technology Association (GEIA) to address aerospace issues related to the global elimination of lead from electrical and electronic equipment put on the market after July 1, 2006. Formed in 2004, the coalition includes all stakeholders — market segments, supply chain, and geographic regions. The working group's approach to these issues is to develop and deliver the following set of standard and guidance documents to the domestic and international communities:
The working group is beginning development of a fifth document to provide guidance on reliability and testing. As the documents move towards completion, the group is focusing its efforts on communication and implementation of the guidance. The group will meet again in March. AIA Source: rusty.rentsch@aia-aerospace.org AIA Puts Global Standards in Perspective AIA recently released the first-ever industry position defending the practice of selecting and using standards based on technical merit. The paper was developed by the Strategic Standardization Forum for Aerospace, a broad-based stakeholder group consisting of industry, regulatory agencies, and standards developers. There has been a growing tendency within governments, ministries of defense, and customers in many countries to create legislation or policies that demand that products be built or procured to international standards. "International" is then defined as only those standards produced by a few organizations, such as the International Organization for Standardization and the International Electro-Technical Commission. This type of action has the potential to impact trade if aerospace products are locked out of markets or aren't allowed to compete because of a restricted choice of standards. In practice, aerospace manufacturing worldwide is based on standards that often aren't published by the standards organization, though they are technically excellent and have global acceptance. AIA's position articulates the aerospace industry's need to continue to choose standards based on safety, regulatory, and technical needs without arbitrary restrictions. The position will allow industry to continue to use company, industry, and military specifications and standards along with all other standards that meet the aerospace industry's needs A copy of the position paper can be found on the forum's Web site at www.ssf-aerospace.org. AIA Source: bruce.mahone@aia-aerospace.org AIA VIEWPOINT: FAA Funding Issues Debated By Mike Romanowksi, AIA Vice President of Civil Aviation Authorization of the Aviation Trust Fund, which supports a significant portion of FAA's operations and infrastructure costs, expires at the end of fiscal 2007. The agency is expected to offer a detailed proposal this spring for a new funding concept to replace the trust fund. Last April FAA began engaging industry stakeholders in defining follow-on funding mechanisms for inclusion in the 2007 FAA reauthorization. An AIA team led by the Civil Aviation Council has been engaged with FAA management throughout the process and has developed a series of key principles to guide development of association positions as funding debate continues. AIA believes a new funding system must:
This scheme is strongly supported by large commercial operators but is opposed by the business and small-aircraft general aviation communities. More significantly for manufacturers, FAA is considering imposing service fees for its certification functions similar to those used in Europe. AIA is adamantly opposed to this concept for several reasons:
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