Thank you for your leadership in cosponsoring H.R. 3765, the Commercial Space Launch Act Amendments. Legislation will greatly assist industry's ability to establish a viable and competitive U.S. commercial space transportation capability. This capability is not only critical to domestic companies which desire to compete as launch service providers, but is of vital importance to satellite manufacturers, telecommunication service providers and other commercial and scientific users which depend on reliable, cost effective and diverse launch services for their economic success A strong domestic, commercial ELV industry will protect jobs and provide favorable trade balances for these and other related industries whose sales represent billions of dollars. Legislation is necessary to ensure that U.S. industry will never again be solely reliant on foreign entities for commercial access to space as was the case in the months following the Challenger accident. Legislation is necessary to address several immediate needs of the emerging commercial space transportation industry. The transition from a U.S. dependence on solely government-provided launch services to a primary reliance on commercial launch services will require a commitment by our government to policies which allow private industry to quantify and minimize the risks associated with launch services. A fundamental provision of the legislation is the shared risk approach offered to commercial launch service providers, their customers, and the public in the event that damages resulting from a commercial launch accident exceed the financial protection reasonably available from the insurance marketplace. This shared risk approach is similar to that provided by the government when NASA furnished commercial launch services. It is essential that domestic firms not be required to "bet their company" each time they participate in a launch activity. Moreover, the enactment of this will allow U.S. companies to compete with foreign launch service providers whose governments supply either similar or complete protection against such claims. We again commend your efforts on H.R. 3765 and look forward to working with you in establishing a shared risk approach that is so essential to the commercial ELV industry's survival. This will ensure that the United States will remain competitive with the heavily subsidized efforts of our foreign competitors and will be a major step in restoring U.S. preeminence in commercial space activities. Alexander & Alexander, Inc. Ford Aerospace Corporation Sincerely, LTV Missiles & Electronics Group Martin Marietta Corporation National Association of Insurance Satellite Broadcasting and Communications Association of We are writing this letter in support of Bill H.R. 3765 In reviewing insurance section 4, Insurance Requirements This Section 16 (a) (1) (B) should be amended to require the U.S. Government to enter into reciprocal waivers of claims for damage to government property in excess of insurance purchased. /..... Johnson & Higgins /..... February 12, 1988- The Honorable Bill Nelson The most important aspect of the proposed Bill is the agreement of the U.S. Government to pay for successful claims in excess of insurance obtained. We believe this is needed to protect the financial integrity of launch service providers and their customers, contractors and subcontractors. The other very important features are the liability limitations of $500,000,000 for third party liability and $100,000,000 for damage to government property. Our industry will respond more positively to a set dollar requirement than to the "maximum amount of insurance available at a reasonable cost" as stated in the model ELV agreement. If these limitations are in place, launch service providers will be able to procure insurance in a competitive market place. If the launch service providers must purchase the "maximum amount of insurance available at a reasonable cost", the usual competitive market forces will be eliminated due to the great amount of capacity which will have to be obtained by the launch service providers. Rather than having alternative sources of capacity, the launch service providers will most likely rely on a sole source or at best severely limited sources of capacity. This usually results in more restrictive insurance coverage at greater cost. We wish you success and stand ready to assist in any way we can. truly yours слений Alden M. Richards Vice President Space Systems Group AMR:phs GE Communications and Services ("GEC&S") hereby submits its comments for the record of the Subcommittee's recent consideration of H. R. 3765, the "Commercial Space Launch Amendments of 1937." Overview One of the components of GEC&S is GE American Communications ("GE Americom"), a domestic communications satellite company. GE Americom has been a pioneer in the communications satellite field, and currently manages seven in-orbit satellites. All of these satellites were launched by NASA, and GE Americom had, prior to the Challenger accident, reservations to launch two additional satellites. - GE Americom is now in the process of constructing several satellites including the two that were on the NASA manifest. As a result of the President's decision that NASA would henceforth be restricted to launching only government and scientific payloads, GE Americom has been actively negotiating with a number of private firms for launch arrangements via expendable launch vehicles ("ELVS"). In these negotiations, we have been advised by some ELV companies that their costs of the launch would include an element reflecting the expense of casualty and liability insurance. Other firms have told us that the cost that we would pay for launch services would include a certain amount the company would set aside for Hon. Bill Nelson March 23, 1988 self-insurance. These charges would be in addition to the cost that GE Americom would spend in acquiring casualty and liability insurance of our own to protect ourselves against possible liability risks incurred by the satellite itself. This is unlike the former arrangements under NASA, in which the government would take care of possible liability for third-party injuries and damages it caused in a launch failure, while a satellite operator would take out insurance only to cover its own risks. This is one reason we favor the continued presence of NASA in the business of launching domestic communications satellites, but we are not here to take issue with the President's decision. While the costs of launching any payload on an ELV would normally include an element for insurance, the situation is further complicated by the fact that the ELV operators with which we have been negotiating have not been able to determine the actual cost of acquiring this insurance. This not only complicates our selection decision but also makes it difficult to ascertain the exact costs of placing a satellite in orbit. For these reasons, GE Americom welcomes any effort to fix and possibly relieve the insurance burden on ELV operators. We believe that H. R. 3765 goes a long way in satisfying both objectives. By knowing in advance the extent of their liability, ELV operators would be in a better position to give firm quotes to satellite companies. In addition, by fixing liability at reasonable amounts, H. R. 3765 assures that ELV operators will not include in their costs potentially unlimited amounts for insurance. We endorse the equitable cost-sharing structure of the bill. This recognizes the vital stake the United States has in retaining its leadership in space. Another important aspect of the bill that we support is the way it defines the incremental costs for which ELV operators using government ranges must pay, since these are also directly related in the charges by ELV operators to satellite companies. |