Space Transportation Services Purchase Act of 1993
(HR2731)


                                                                              I
  103d CONGRESS
    1st Session
                                   H. R. 2731
 
  To encourage the development of a commercial space industry in the United
      States, and for other purposes.
 
                         ------------------------------
 
                         IN THE HOUSE OF REPRESENTATIVES
                                  July 23, 1993
  Mr. Walker (for himself, Mr. Fawell, Mr. Smith of Michigan, and Mr.
      Rohrabacher) introduced the following bill; which was referred jointly to
      the Committees on Science, Space, and Technology, Ways and Means, Natural
      Resources, Agriculture, and the Judiciary
 
                         ------------------------------
 
                                     A BILL
  To encourage the development of a commercial space industry in the United
      States, and for other purposes.

                         ==============================
 
      Be it enacted by the Senate and House of Representatives of the United
  States of America in Congress assembled,
 
  SECTION 1. SHORT TITLE.
      This Act may be cited as the "Omnibus Space Commercialization Act of
  1993".

  SEC. 2. FINDINGS.
      The Congress finds that--
          (1) the exploration of space holds the potential for vast new
      enterprises which will benefit the United States and all of mankind;
          (2) inevitably where exploration has taken place commercial activity
      follows;
          (3) the development of a robust commercial space industry in the
      United States is required to restore and maintain United States world
      leadership in the exploration, development, commercialization, and
      settlement of space and to maintain the health and growth of the national
      economy, meet national security objectives, and sustain the position of
      the United States as a world power;
          (4) the United States is in danger of losing its leadership position
      in space transportation;
          (5) the Federal Government should encourage, facilitate, and promote
      the United States commercial space industry, including the development of
      commercial launch facilities, in order to ensure United States economic
      preeminence in space;
          (6) creation of a space infrastructure and transportation industries
      in a timely, profitable, innovative, and sustainable manner can be
      accomplished only by private enterprise;
          (7) incentives are needed to be put in place for private enterprise
      to undertake the high risk venture of commercial space industrialization;
      and
          (8) commercial space activity presents unique legal problems that
      need to be clarified before the full industrialization of space can go
      forward.
 
  SEC. 3. DEFINITIONS.
      For purposes of this Act--
          (1) the term "commercial provider" means any person providing space
      transportation services or other space-related activities;
          (2) the term "payload" means anything that a person undertakes to
      transport to, from, or within outer space, or in suborbital trajectory,
      by means of a space transportation vehicle, but does not include the
      space transportation vehicle itself except for its components which are
      specifically designed or adapted for that payload;
          (3) the term "Secretary" means the Secretary of Transportation;
          (4) the term "space infrastructure" means all facilities, equipment,
      and real property (including ranges) used to perform space-related
      activities;
          (5) the term "space launch and launch support facilities" means space
      infrastructure used--
              (A) to prepare space transportation vehicles and their payloads
          for transportation to, from, or within outer space, or in suborbital
          trajectory; or
              (B) to launch such vehicles;
          (6) the term "space-related activities" includes research and
      development, manufacturing, processing, service, and other associated and
      support activities;
          (7) the term "space transportation services" means the preparation of
      a space transportation vehicle and its payloads for transportation to,
      from, or within outer space, or in suborbital trajectory, and the conduct
      of transporting a payload to, from, or within outer space, or in
      suborbital trajectory;
          (8) the term "space transportation vehicle" means any vehicle
      constructed for the purpose of operating in, or transporting a payload
      to, from, or within, outer space, or in suborbital trajectory, and
      includes any component of such vehicle not specifically designed or
      adapted for a payload;
          (9) the term "United States person" means an individual, corporation,
      commercial provider, or other entity organized under the laws of the
      United States or a State, Commonwealth, territory, or possession of the
      United States which is--
              (A) more than 50 percent owned by United States nationals; or
              (B) a subsidiary of a foreign company and the Secretary finds
          that--
                  (i) such subsidiary has in the past evidenced a substantial
              commitment to the United States market through--
                      (I) investments in the United States in long-term
                  research, development, and manufacturing (including the
                  manufacture of major components and subassemblies); and
                      (II) significant contributions to employment in the
                  United States; and
                  (ii) the country or countries in which such foreign company
              is incorporated or organized, and, if appropriate, in which it
              principally conducts its business, affords reciprocal treatment
              to companies described in subparagraph (A) comparable to that
              afforded to such foreign company's subsidiary in the United
              States, as evidenced by--
                      (I) providing comparable opportunities for companies
                  described in subparagraph (A) to participate in Government
                  sponsored research and development similar to that authorized
                  under this Act;
                      (II) providing no barriers to companies described in
                  subparagraph (A) with respect to local investment
                  opportunities that are not provided to foreign companies in
                  the United States; and
                      (III) providing adequate and effective protection for the
                  intellectual property rights of companies described in
                  subparagraph (A); and
          (10) the term "antitrust laws" has the meaning given it in section
      1(a) of the Clayton Act (15 U.S.C. 12(a)), except that such term includes
      sections 2 through 6 of the National Cooperative Research Act of 1984 (15
      U.S.C. 4301 through 4305), and includes section 5 of the Federal Trade
      Commission Act to the extent that such section 5 applies to unfair
      methods of competition.

               TITLE I--SPACE LAUNCH AND LAUNCH SUPPORT FACILITIES
 
  SEC. 101. INVENTORY OF FACILITIES.
      (a) Inventory.--The Comptroller General shall conduct a comprehensive
  inventory of all space launch and launch support facilities owned by the
  United States Government and shall identify such facilities that are surplus
  to public and national security needs. This subsection shall be carried out
  in cooperation with the Department of Defense, the National Aeronautics and
  Space Administration, the Department of Transportation, the Department of
  Commerce, and the General Services Administration.
      (b) Report.--Not later than 12 months after the date of enactment of this
  Act, the Comptroller General shall submit to the Congress a report containing
  the inventory and identification required under subsection (a), including an
  item by item justification of why each facility is or is not identified as
  surplus. Portions of such report may be classified and protected from public
  disclosure if such classification is essential to protect national security.
      (c) Referral for Sale.--All facilities identified under this section as
  surplus shall be referred to the General Services Administration for
  disposition.

  SEC. 102. COMMERCIAL SPACE CENTERS.
      (a) Designation.--The Secretary shall establish criteria for the
  designation of Commercial Space Centers. The Secretary shall, in accordance
  with such criteria, designate appropriate launch facilities as Commercial
  Space Centers.
      (b) Benefits of Designation.--Commercial Space Centers, all property
  located therein, all space transportation services and space-related
  activities carried out therein, and all products and services created,
  processed, manufactured, or otherwise arising from such space transportation
  services and space-related activities, including such services and activities
  in space as are launched from a Commercial Space Center and products created,
  manufactured, or processed in connection therewith, and proceeds from
  insurance policies insuring such services and activities, shall be exempt
  from--
          (1) all Federal corporate income and other taxes; and
          (2) all Federal excises, imposts, duties, and any and all other
      Federal tariffs.

  SEC. 103. PUBLIC LAND FOR NEW SPACE LAUNCH AND LAUNCH SUPPORT FACILITIES.
      (a) Facilitation of Proposals.--The Secretary of the Interior and the
  Secretary of Agriculture shall facilitate proposals by commercial providers,
  with or without the participation of State and local governments, to
  establish new space launch and launch support facilities on public lands
  administered through their respective departments through sale, lease, grant
  of overflight and clearance easements, or other transfer of such lands, and
  shall ensure timely review and decision regarding such proposals.
      (b) Leases.--Leases described in subsection (a) shall be to commercial
  providers for periods of 30 years, with options to extend for an additional
  20 years. Parties signing such a lease shall enjoy occupation and use of the
  lands without charge for the first 10 years of the term of the lease. The
  annual lease price for the remaining 20 years, and for any period of
  extension, of the lease shall be based on fair market value at the time of
  the submission of the initial request for use of the land, except that lands
  used for livestock grazing at the time of the signing of a lease shall be
  leased at the rate charged for grazing access.
      (c) Wilderness, Recreation, and Park Areas.--(1) Except as provided in
  paragraph (2), no wilderness area, national recreation area, or national
  park, or any part thereof, shall be transferred as described in subsection
  (a).
      (2) Overflight easements for extra-atmospheric flight may be granted over
  such areas if the Secretary of Transportation finds that danger to the
  general public is not significantly increased thereby.
      (d) Noncontiguous Land Parcels.--Land parcels sold, leased, or otherwise
  made available under this section need not be contiguous. Road and
  communication easements shall be granted wherever practical to link such
  parcels.
      (e) Compatible Uses.--Proposers shall be encouraged to submit proposals
  compatible with--
          (1) existing uses, including livestock grazing, mining, and forest
      activities;
          (2) scientific activities, including aircraft research and test
      flights; and
          (3) other space-related activities.

               TITLE II--PURCHASE OF SPACE TRANSPORTATION SERVICES
 
  SEC. 201. SHORT TITLE.
      This title may be cited as the "Space Transportation Services Purchase
  Act of 1993".
 
  SEC. 202. REQUIREMENT TO PROCURE COMMERCIAL LAUNCH SERVICES.
      Section 204 of the Launch Services Purchase Act of 1990 (42 U.S.C. 2465d)
  is amended to read as follows:
 
  "SEC. 204. REQUIREMENT TO PROCURE COMMERCIAL LAUNCH SERVICES.
      "(a) In General.--Except as otherwise provided in this section, the
  Federal Government shall purchase launch services from commercial providers
  whenever such services are required in the course of its activities.
      "(b) Exceptions.--The Federal Government shall not be required to
  purchase launch services as provided in subsection (a) if, on a case by case
  basis the Administrator of the National Aeronautics and Space Administration
  (hereafter in this section referred to as the 'Administrator'), or the
  Secretary of Defense, as the case may be, determines that--
          "(1) the payload requires the unique capabilities of the space
      shuttle;
          "(2) commercial launch services to meet specific mission requirements
      are not reasonably available or would not be reasonably available when
      required;
          "(3) the use of commercial launch services poses an unacceptable risk
      of loss of a unique scientific opportunity; or
          "(4) the payload serves national security or foreign policy purposes.
  Any determination of such circumstances shall be made by the Administrator or
  the Secretary of Defense and shall not be delegated. The Administrator, or
  the Secretary of Defense, as the case may be, shall, within 30 days after
  such determination, notify the Committee on Science, Space, and Technology
  and the Committee on Armed Services of the House of Representatives and the
  Committee on Commerce, Science, and Transportation of the Senate in writing
  of the determination and its rationale.
      "(c) Federal Government Launch Vehicles.--Launch vehicles shall be
  acquired or owned by the Federal Government only--
          "(1) as required under circumstances described in subsection (b); or
          "(2) for conducting research and development on, and testing of,
      launch technology.
      "(d) Phase-In Period.--Subsections (a) and (c) shall not apply to launch
  services and launch vehicles for which a purchase contract has been signed
  before the date of enactment of this Act.
      "(e) Historical Purposes.--This title shall not be interpreted to
  prohibit the Federal Government from acquiring, owning, or maintaining launch
  vehicles solely for historical display purposes.".
 
  SEC. 203. PURCHASE OF LAUNCH SERVICES.
      Section 205 of the Launch Services Purchase Act of 1990 (42 U.S.C. 2465e)
  is amended to read as follows:
 
  "SEC. 205. PURCHASE OF LAUNCH SERVICES.
      "(a) Competitive Bidding.--(1) Contracts to provide launch services to
  the Federal Government under section 204 shall be awarded subject to
  applicable Federal law requiring full, fair, and open competition, consistent
  with section 2304 of title 10, United States Code, and section 311 of the
  National Aeronautics and Space Act of 1958.
      "(2) Submission of cost or pricing data for the purpose of supporting a
  bid or proposal or for the fulfillment of a contract shall not be required of
  the bidders, except in cases where only one credible bid meeting minimal
  technical standards as set forth in the original solicitation is received.
      "(b) Specification Systems.--Reasonable performance specifications,
  rather than Federal civilian or military design or construction
  specifications, shall be used to the maximum extent feasible to define
  requirements for a commercial provider bidding to provide launch services.
  This subsection shall not preclude the Federal Government from requiring
  compliance with applicable safety standards.".
 
  SEC. 204. COMMERCIAL SPACE LAUNCH ACT AMENDMENTS.
      (a) Amendments.--The Commercial Space Launch Act (49 U.S.C. App. 2601 et
  seq.) is amended--
          (1) in section 4--
              (A) by inserting "from Earth" after "if any," in paragraph (2);
              (B) by redesignating paragraphs (9) through (12) as paragraphs
          (11) through (14), respectively; and
              (C) by inserting after paragraph (8) the following new
          paragraphs:
          "(9) 'reenter' and 'reentry' mean to return purposefully, or attempt
      to return, a reentry vehicle and payload, if any, from Earth orbit or
      outer space to Earth;
          "(10) 'reentry vehicle' means any vehicle designed to return from
      Earth orbit or outer space to Earth substantially intact;";
          (2) in section 6(a), by inserting ", or reenter a reentry vehicle,"
      after "operate a launch site" each place it appears;
          (3) in section 6(a) (2) and (3), by striking "section 4(11)" each
      place it appears and inserting in lieu thereof "section 4(12)";
          (4) in section 6(a)(3)(A), by inserting "or reentry" after "such
      launch or operation";
          (5) in section 6(a)(3), by inserting ", or reentry of a reentry
      vehicle," after "operation of a launch site" each place it appears;
          (6) in section 6(b)(1)--
              (A) by striking "launch license" and inserting in lieu thereof
          "license";
              (B) by inserting "or reenter" after "shall not launch";
              (C) by inserting "or reentry" after "relate to the launch"; and
              (D) by inserting "or reentered" after "to be launched";
          (7) in section 6(b)(2)--
              (A) by inserting "or reentry" after "prevent the launch";
              (B) by striking "holder of a launch license" and inserting in
          lieu thereof "licensee"; and
              (C) by inserting "or reentry" after "determines that the launch";
          (8) in section 6(c)(1), by inserting "or reentry of a reentry
      vehicle" after "operation of a launch site";
          (9) in section 7, by striking "both" and inserting in lieu thereof
      "for reentering one or more reentry vehicles";
          (10) in sections 8(a), 9(b), 11(a), 11(b), 12(a)(2)(B), and 12(b), by
      inserting ", or reentry of a reentry vehicle," after "operation of a
      launch site" each place it appears;
          (11) in section 8(b), by inserting "and the reentry of reentry
      vehicles," after "operation of launch sites,";
          (12) in section 11(a), by inserting "or reentry" after "launch or
      operation";
          (13) in section 12(a)(1), by inserting "or reentry" after "prevent
      the launch";
          (14) in section 12(b), by inserting "or reentry" after "prevent the
      launch";
          (15) in section 14(a)(1)--
              (A) by inserting "or reentry site" after "observers at any launch
          site"; and
              (B) by inserting "or reentry vehicle" after "assembly of a launch
          vehicle";
          (16) in section 15(b)(4)(A)--
              (A) by inserting "and reentries" after "ensure that the
          launches";
              (B) by inserting "or reentry date commitment" after "launch date
          commitment";
              (C) by inserting "or reentry" after "obtained for a launch";
              (D) by inserting ", reentry sites," after "United States launch
          sites";
              (E) by inserting "or reentry site" after "access to a launch
          site";
              (F) by inserting ", or services related to a reentry," after
          "amount for launch services"; and
              (G) by inserting "or reentry" after "the scheduled launch";
          (17) in section 15(b)(4)(B), by inserting "or reentry" after "prompt
      launching";
          (18) in section 15(c), by inserting "or reentry" after "launch site";
          (19) in section 16(a)(1) (A) and (B), by inserting "or reentry" after
      "any particular launch" each place it appears;
          (20) in section 16(a)(1) (C) and (D), by inserting "or a reentry"
      after "launch services" each place it appears;
          (21) in section 16(a)(2), by inserting "or reentry" after "launch
      services";
          (22) in section 16(b)(1) and (4) (A) and (B), by inserting "or
      reentry" after "particular launch" each place it appears;
          (23) in section 17(b)(2)(A)--
              (A) by inserting "reentry site," after "launch site,"; and
              (B) by inserting "or reentry vehicle" after "site of a launch
          vehicle";
          (24) in section 21(a), by inserting "and reentry" after "approval of
      space launch";
          (25) in section 21(b)--
              (A) by inserting ", reentry vehicle," after "A launch vehicle";
          and
              (B) by inserting "or reentry" after "the launching";
          (26) in section 21(c)(1)--
              (A) by striking "or" in subparagraph (B);
              (B) by redesignating subparagraph (C) as subparagraph (D); and
              (C) by inserting after subparagraph (B) the following new
          subparagraph:
              "(C) reentry of a reentry vehicle, or";
          (27) in section 21(c)(2), by inserting "reentry," after "launch,";
      and
          (28) in section 22(a)--
              (A) by striking "ending after the date of enactment of this Act
          and before October 1, 1989"; and
              (B) by inserting "and reentries" after "further commercial
          launches".
      (b) Report to Congress.--The Secretary of Transportation shall submit to
  Congress an annual report to accompany the President's budget request which
  reviews the performance of the regulatory activities and the effectiveness of
  the Office of Commercial Space Transportation.

                  TITLE III--INTELLECTUAL PROPERTY DISPOSITION
 
  SEC. 301. RESEARCH UNDER CONTRACT WITH FEDERAL GOVERNMENT.
      Any commercial provider making an invention under contract with the
  Federal Government shall have the same rights with respect to such invention
  as would a small business firm under chapter 38 of title 35, United States
  Code.
 
  SEC. 302. COOPERATIVE RESEARCH AND DEVELOPMENT AGREEMENTS.
      Section 12 of the Stevenson-Wydler Technology Innovation Act of 1980 (15
  U.S.C. 3710a) is amended--
          (1) in subsection (a) by striking "may permit" and inserting in lieu
      thereof "shall permit, under authority of this or any other appropriate
      Act,"; and
          (2) in subsection (d)(1) by inserting "intellectual property," after
      "equipment," both places it appears.

            TITLE IV--TAX INCENTIVES FOR COMMERCIAL SPACE ACTIVITIES
 
  SEC. 401. SHORT TITLE.
      This title may be cited as the "Space Business Incentives Act of 1993".
 
  SEC. 402. DEDUCTION FOR PURCHASE OF COMMERCIAL SPACE CENTER STOCK.
      (a) In General.--Part VI of subchapter B of chapter 1 of the Internal
  Revenue Code of 1986 (relating to itemized deductions for individuals and
  corporations) is amended by adding at the end thereof the following new
  section:
 
  "SEC. 197. DEDUCTION FOR PURCHASE OF COMMERCIAL SPACE CENTER STOCK.
      "(a) In General.--At the election of the taxpayer, there shall be allowed
  as a deduction the aggregate amount paid during the taxable year for the
  purchase of Commercial Space Center stock on the original issue of such stock
  by a qualified issuer.
      "(b) Maximum Deduction.--
          "(1) In general.--The maximum amount allowed as a deduction under
      subsection (a) to a taxpayer for the taxable year shall not exceed
      $100,000.
          "(2) Controlled groups.--For purposes of paragraph (1), the taxpayer
      and all persons who are related persons with respect to the taxpayer
      shall be treated as 1 person, and the $100,000 amount in paragraph (1)
      shall be allocated among the taxpayer and such persons in proportion to
      their respective purchases of stock during the taxable year for which the
      deduction is allowable by this section.
          "(3) Allocation of deduction where more than $100,000 of stock
      purchased.--If the amount of stock purchased by any person exceeds the
      limitation under this subsection with respect to such person, the
      deduction allowed under this section shall be allocated pro rata among
      the stock so purchased in accordance with the purchase price per share.
      "(c) Dispositions of Stock.--
          "(1) Gain treated as ordinary income.--If any Commercial Space Center
      stock with respect to which a deduction was allowed under this section is
      disposed of by the taxpayer, then the lesser of--
              "(A) the excess of--
                  "(i)(I) in the case of a sale or exchange, the amount
              realized, or
                  "(II) in the case of any other disposition, the fair market
              value of the stock, over
                  "(ii) the adjusted basis of such stock, or
              "(B) the amount of the deduction allowed under this section with
          respect to such stock,
      shall be treated as ordinary income. Such gain shall be recognized
      notwithstanding any other provision of this subtitle.
          "(2) Interest charged if disposition within 3 years of purchase.--
              "(A) In general.--If any Commercial Space Center stock is
          disposed of before the end of the 3-year period beginning on the date
          such stock was purchased by the taxpayer, the tax imposed by this
          chapter for the taxable year in which such disposition occurs shall
          be increased by the Commercial Space Center stock recapture amount.
              "(B) Commercial space center stock recapture amount.--For
          purposes of subparagraph (A), the term 'Commercial Space Center stock
          recapture amount' means an amount equal to the amount of interest
          (determined at the underpayment rate applicable under section 6621)
          which would accrue--
                  "(i) during the period beginning on the date such stock was
              purchased by the taxpayer and ending on the date such stock was
              disposed of by the taxpayer,
                  "(ii) on the aggregate decrease in tax of the taxpayer
              resulting from the deduction allowed under this section with
              respect to the stock so disposed of.
      "(d) Treatment Where Issuer Ceases to be Qualified.--
          "(1) In general.--If--
              "(A) any qualified issuer with respect to the stock of which any
          taxpayer has made an election under this section ceases to meet the
          requirements of subsection (e)(2)(A), and
              "(B) such cessation occurs at any time before the close of the
          5th taxable year ending after the date such stock was issued,
      the tax treatment described in paragraph (2) shall apply to the taxable
      year of the taxpayer in which such cessation occurs.
          "(2) Tax treatment of taxpayer.--The tax treatment described in this
      paragraph for any taxable year is--
              "(A) the taxpayer shall include in income as ordinary income the
          amount of the deduction allowed under this section with respect to
          such stock,
              "(B) the tax imposed by this chapter for such taxable year shall
          be increased by an amount equal to the amount of interest (determined
          at the underpayment rate applicable under section 6621) which would
          accrue--
                  "(i) during the period beginning on the date such stock was
              purchased by the taxpayer and ending on the disqualification
              date,
                  "(ii) on the aggregate decrease in tax of the taxpayer
              resulting from the deduction allowed under this section with
              respect to the stock.
          "(3) Disqualification date.--For purposes of paragraph (2), the term
      'disqualification date' means the last day of the taxable year of the
      qualified issuer in which the requirements of subsection (e)(2)(A) ceased
      to be met.
          "(4) Exception for small investors.--In the case of an individual,
      paragraph (1) shall not apply if, on the disqualification date with
      respect to any qualified issuer, the aggregate of the deductions allowed
      to the taxpayer under this section with respect to stock issued by such
      issuer does not exceed $5,000 ($10,000 in the case of a joint return).
      "(e) Definitions.--For purposes of this section--
          "(1) Commercial space center stock.--The term 'Commercial Space
      Center stock' means common stock issued by a qualified issuer but only if
      the proceeds of such issue are used by such issuer to establish or
      operate a Commercial Space Center.
          "(2) Qualified issuer.--The term 'qualified issuer' means any
      corporation which, at the time of issuance of the stock involved is
      conducting a business at least 75 percent of the gross receipts of which
      for the taxable year are attributable to--
              "(A) operations within a Commercial Space Center, or
              "(B) the establishment or operation of a Commercial Space Center,
      in the active conduct of a trade or business.
          "(3) Related person.--A person is a related person to another person
      if--
              "(A) such persons are treated as a single employer under
          subsections (a) and (b) of section 52, or
              "(B) in the case of individuals, such persons are husband and
          wife.
      "(f) Special Rules.--

          "(1) Amount paid after close of taxable year.--An amount paid after
      the close of the taxable year for the purchase of Commercial Space Center
      stock shall be treated for purposes of subsection (a) as paid during such
      year if--
              "(A) such amount is so paid not later than the time prescribed by
          law for filing the return for such taxable year (including extensions
          thereof), and
              "(B) the taxpayer was under a binding contract as of the close of
          such taxable year to purchase such stock.
          "(2) Limitation on amount of deduction.--If--
              "(A) any Commercial Space Center stock is issued in exchange for
          property,
              "(B) the basis of such stock in the hands of the taxpayer is
          determined by reference to the basis of such property, and
              "(C) the adjusted basis (for determining gain) of such property
          immediately before the exchange exceeded its fair market value at
          such time,
      then the deduction under this section, and such adjusted basis, shall
      both be reduced by the excess described in subparagraph (C).
      "(g) Basis Adjustment.--For purposes of this subtitle, if a deduction is
  allowed under this section with respect to the purchase of any stock, the
  basis of such stock (without regard to this subsection) shall be reduced by
  the amount of the deduction allowed with respect to the purchase of such
  stock.
      "(h) Application of Section.--This section shall apply only to stock
  acquired after December 31, 1992, and before January 1, 2008."
      (b) Technical Amendment.--Subsection (a) of section 1016 of such Code
  (relating to adjustments to basis) is amended by striking out "and" at the
  end of paragraph (23), by striking out the period at the end of paragraph
  (24) and inserting in lieu thereof ", and", and by adding at the end thereof
  the following new paragraph:
          "(25) to the extent provided in section 197(g), in the case of stock
      with respect to which a deduction was allowed under section 197."
      (c) Clerical Amendment.--The table of sections for part VI of subchapter
  B of chapter 1 of such Code is amended by adding at the end thereof the
  following new item:
 
              "Sec. 197. Deduction for purchase of Commercial Space Center
                              stock."
      (d) Effective Date.--The amendments made by this section shall apply to
  stock purchased after December 31, 1992.
 
  SEC. 403. EXCLUSION OF GAIN ON SALE OF STOCK OF CORPORATION SUBSTANTIALLY
      ENGAGED IN SPACE-RELATED ACTIVITIES.
      (a) In General.--Part III of subchapter B of chapter 1 of the Internal
  Revenue Code of 1986 (relating to items specifically excluded from gross
  income) is amended by redesignating section 137 as section 138 and by
  inserting after section 136 the following new section:
 
  "SEC. 137. GAIN ON SPACE CORPORATION STOCK.
      "(a) General Rule.--Gross income shall not include gain on the sale or
  exchange of space corporation stock.
      "(b) Limitations.--
          "(1) Maximum dollar amount.--
              "(A) In general.--The maximum amount excluded under subsection
          (a) to a taxpayer for the taxable year shall not exceed $100,000.
              "(B) Controlled groups.--For purposes of subparagraph (A), the
          taxpayer and all persons who are related persons (as defined in
          section 197(c)(3)) with respect to the taxpayer shall be treated as 1
          person, and the $100,000 amount in subparagraph (A) shall be
          allocated among the taxpayer and such persons in proportion to their
          respective sales and exchanges of stock during the calendar year in
          which the taxable year of the taxpayer begins.
          "(2) Excluded gain must be long-term capital gain.--Subsection (a)
      shall not apply to any gain other than long-term capital gain.
      "(c) Space Corporation Stock.--
          "(1) In general.--The term 'space corporation stock' means common
      stock acquired by the taxpayer on its original issue by a space
      corporation.
          "(2) Space corporation.--The term 'space corporation' means any
      corporation which, during each of its 3 taxable years ending before the
      date of the sale or exchange by the taxpayer, derived at least 75 percent
      of its gross receipts of from the active conduct of a trade or business
      involving the providing of space-related products or services. For
      purposes of the preceding sentence, gross receipts attributable to
      operations within a Commercial Space Center, or to the establishment or
      operation of a Commercial Space Center, shall not be taken into account.
      "(d) Application of Section.--This section shall apply only to stock
  acquired after December 31, 1992, and before January 1, 2008."
      (b) Clerical Amendment.--The table of sections for such part III is
  amended by striking the last item and inserting the following new item:
 
              "Sec. 137. Gain on space corporation stock."
      (c) Effective Date.--The amendments made by this section shall apply to
  stock purchased after December 31, 1992.

  SEC. 404. TREATMENT OF BONDS TO FINANCE SPACE LAUNCH AND LAUNCH SUPPORT
      FACILITIES.
      (a) In General.--Subsection (a) of section 142 of the Internal Revenue
  Code of 1986 (defining exempt facility bond) is amended by striking "or" at
  the end of paragraph (10), by striking the period at the end of paragraph
  (11) and inserting ", or", and by adding at the end thereof the following:
          "(12) space launch and launch support facilities.
  Paragraph (12) shall not apply to any bond issued after December 31, 2007."
      (b) Space Launch and Launch Support Facilities.--Section 142 of such Code
  is amended by adding at the end thereof the following new subsection:
      "(j) Space Launch and Launch Support Facilities.--For purposes of
  subsection (a)(12), the term 'space launch and launch support facilities'
  means--
          "(1) all facilities, equipment, and real property used to prepare
      space transportation vehicles and their payloads for transportation to,
      from, or within outer space, or in suborbital trajectory or to launch
      such vehicles, and
          "(2) all facilities, equipment, and real property used to conduct
      research and development, manufacture, process, and service space
      transportation vehicles and their payloads.
  For purposes of the preceding sentence, the terms 'space transportation
  vehicles' and 'payloads' have the respective meanings given such terms by
  section 3 of the Omnibus Space Commercialization Act of 1993."
      (c) Exception From Volume Cap.--Paragraph (3) of section 146(g) of such
  Code is amended by striking "or (2)" and inserting ", (2), or (12)" and by
  inserting "and space launch and launch support facilities" after "wharves".
      (d) Certain Additional Requirements Not To Apply to Space Launch and
  Launch Support Facilities Bonds.--
          (1) Subsection (h) of section 147 of such Code is amended by adding
      at the end thereof the following new paragraph:
          "(3) Space launch and launch support facilities bonds.--Subsections
      (a), (b), (c), and (d) shall not apply to any exempt facility bond
      described in section 142(a)(12)."
          (2) The heading for subsection (h) of section 147 of such Code is
      amended by striking "and Qualified 501(c)(3) Bonds" and inserting
      "Qualified 501(c)(3) Bonds, and Space Launch and Launch Support
      Facilities Bonds".
      (e) Federal Guaranteed Space Launch and Launch Support Facilities Bonds
  Permitted.--Paragraph (3) of section 149(b) of such Code is amended by adding
  at the end thereof the following new subparagraph:
              "(E) Exception for space launch and launch support facilities
          bonds.--Paragraph (1) shall not apply to any exempt facility bond
          described in section 142(a)(12) in situations where the guarantee of
          the United States (or any agency or instrumentality thereof) is the
          result of payment of rent, user fees, or other charges by the United
          States (or any agency or instrumentality thereof) for the use of a
          facility financed with such a bond."
      (f) Exception From Advance Refunding Rules.--Paragraph (2) of section
  149(d) of such Code is amended by striking "bond)." and inserting "bond or
  any exempt facility bond described in section 142(a)(12))."
      (g) Effective Date.--The amendments made by this section shall apply to
  obligations issued after the date of the enactment of this Act.
 
  SEC. 405. SPACE MANUFACTURING INCENTIVE.
      (a) In General.--Part III of subchapter B of chapter 1 of the Internal
  Revenue Code of 1986 (relating to items specifically excluded from gross
  income) is amended by inserting after section 137 the following new section:
 
  "SEC. 138. SPACE MANUFACTURING INCOME.
      "(a) General Rule.--Gross income shall not include space manufacturing
  income.
      "(b) Space Manufacturing Income.--For purposes of this section, the term
  'space manufacturing income' means--
          "(1) income derived from the commercial sale of any product which is
      manufactured in outer space and returned to Earth, and
          "(2) income of an individual attributable to services performed in
      outer space by such individual in a commercial space activity.
      "(c) Exclusion From Tariffs, Etc.--Any product which is manufactured in
  outer space and returned to Earth shall be exempt from all Federal excises,
  imposts, and duties and any other Federal tariffs.
      "(d) Phaseout of Benefits.--In the case of a taxable year beginning after
  December 31, 2022, the amount excluded under subsection (a) shall be reduced
  (but not below zero) by x/20th's of the amount excludable without regard to
  this subsection, where 'x' is the number of years such taxable year is after
  the last taxable year beginning before January 1, 2023. A similar rule shall
  apply to the benefits under subsection (c)."
      (b) Clerical Amendment.--The table of sections for such part III is
  amended by adding at the end the following new items:
 
              "Sec. 138. Space manufacturing income.
              "Sec. 139. Cross references to other Acts."
      (c) Effective Date.--The amendments made by this section shall apply to
  taxable years beginning after December 31, 1992.

  SEC. 406. STATE TAX BENEFITS FOR COMMERCIAL SPACE ACTIVITIES TO BE
      ENCOURAGED.
      The President shall encourage State and local governments to offer tax
  and other incentives to encourage commercial space activities.

                             TITLE V--MISCELLANEOUS
 
  SEC. 501. ANTITRUST EXEMPTIONS.
      (a) Standing To Conduct Certain Litigation.--Notwithstanding sections 4
  and 4C of the Clayton Act (15 U.S.C. 15 and 15C) and section 4 (a) and (b) of
  the National Cooperative Research Act of 1984 (15 U.S.C. 4303 (a) and (b)),
  standing to conduct litigation arising from causes of action under such Acts
  arising out of activities carried out under this Act is reserved to the
  Department of Justice under the direction of the Attorney General and the
  Federal Trade Commission.
      (b) Limitation on Relief.--Notwithstanding section 4(a) of the Clayton
  Act (15 U.S.C. 15(a)) and section 4 of the National Cooperative Research Act
  of 1984 (15 U.S.C. 4303), and in lieu of the relief specified in such
  sections, the sole relief available to the United States acting on its own
  behalf or on the behalf of any State or persons, in causes of action under
  such Acts arising out of activities carried out under this Act, shall be
  injunctive relief.
 
  SEC. 502. EVIDENCE.
      In any action against a commercial provider arising in connection with
  activities carried out under this Act, evidence of the failure of such
  commercial provider to follow military specifications or National Aeronautics
  and Space Administration specifications shall not, in and of itself,
  constitute proof of negligence on the part of a commercial provider, except
  where such specifications are specifically required by contract or in cases
  concerning emergency flight termination (range safety) equipment when flights
  are made from launch sites owned by the Federal Government.
 
  SEC. 503. REPORT ON LAWS THAT AFFECT SPACE COMMERCIALIZATION.
      Within one year after the date of enactment of this Act, the Director of
  the National Space Council, in cooperation with the Director of the Office of
  Space Commerce, shall report to the Committee on Science, Space, and
  Technology of the House of Representatives and the Committee on Commerce,
  Science, and Transportation of the Senate on the status of laws and treaties
  in the United States and internationally that affect the ability of the
  United States to commercially exploit space. Such report shall include
  recommendations for any changes to such laws or treaties that may be
  desirable.
 
  SEC. 504. OFFICE OF SPACE COMMERCE.
      (a) Establishment.--There is established within the Department of
  Commerce an Office of Space Commerce.
      (b) Functions.--The Office of Space Commerce shall be the principal unit
  for the coordination of space-related issues, programs, and initiatives
  within the Department of Commerce. The Office's primary responsibilities
  shall include--
          (1) promoting private sector investment in space activities by
      collecting, analyzing, and disseminating information on space markets,
      and conducting workshops and seminars to increase awareness of commercial
      space opportunities;
          (2) assisting commercial space companies in their efforts to do
      business with the United States Government, and acting as an industry
      advocate within the executive branch to ensure that the Federal
      Government meets its space-related requirement, to the fullest extent
      feasible, with commercially available space goods and services;
          (3) ensuring that the United States Government does not compete with
      the private sector in the provision of space hardware and services
      otherwise available from the private sector;
          (4) promoting the export of space-related goods and services;
          (5) representing the Department of Commerce in the development of
      United States policies and in negotiations with foreign countries to
      ensure free and fair trade internationally in the area of space commerce;
          (6) seeking the removal of legal, policy, and institutional
      impediments to space commerce; and
          (7) licensing private sector parties to operate private remote
      sensing space systems and supporting the private sector's role in the
      commercial development of Landsat remote sensing data distribution.
 
  SEC. 505. SPACE-RELATED RESEARCH.
      (a) Required Reports.--Each Federal agency or department covered by this
  section shall, within 1 year after the appropriation of the amount that
  brings the agency or department under the coverage of this section, submit a
  report to Congress containing a plan for activities to support space-related
  research appropriate to the mission of such agency or department. Once every
  2 years after the submission of such report, the agency or department shall
  report to Congress on progress made in implementing such plan, together with
  suggestions for any policy or legislative changes necessary to enhance the
  agency's or department's ability to implement that plan.
      (b) Coverage.--A Federal agency or department shall be covered by this
  section if it has an annual research and development budget, for a fiscal
  year ending after the date of enactment of this Act, greater than
  $100,000,000.
 
  SEC. 506. COMMERCIAL ADVERTISING.
      To the extent that safety is not compromised, the United States shall
  accommodate commercial advertising--
          (1) by its contractors or their assigns providing space
      transportation vehicles, space infrastructure, payloads, or space launch
      or launch support facilities; or
          (2) by persons who are engaged in activities which reuse or recycle
      space transportation vehicles, space infrastructure, payloads, or space
      launch or launch support facilities.
 
  SEC. 507. PURCHASE OF SPACE SCIENCE DATA.
      (a) In General.--To the maximum extent possible, the National Aeronautics
  and Space Administration shall purchase from the private sector space science
  data. Examples of such data include scientific data concerning the elemental
  and mineralogical resources of the moon and the planets, Earth environmental
  data obtained through remote sensing observations, and solar storm
  monitoring.
      (b) Competitive Bidding.--(1) Contracts for the purchase of space science
  data shall be awarded in a process of full, fair, and open competitive
  bidding among United States persons.
      (2) Submission of cost data either for the purposes of supporting the bid
  or for the fulfillment of the contract shall not be required of bidders.
      (3) Conformance with military specifications (Milspec) or National
  Aeronautics and Space Administration specification systems with respect to
  the design, construction, or operation of equipment used in obtaining space
  science data for the Federal Government shall not be a requirement for a
  commercial provider bidding to provide such services.
      (4) Contracts under this section shall not provide for the Federal
  Government to obtain ownership of data not specifically sought by the Federal
  Government.

  SEC. 508. PROCUREMENT.
      (a) Procurement Demonstration Program.--
          (1) In general.--The Administrator shall establish within the Office
      of Advanced Concepts and Technology a program of expedited technology
      procurement for the purpose of demonstrating how innovative technology
      concepts can rapidly be brought to bear upon space missions of the
      National Aeronautics and Space Administration.
          (2) Procedures and evaluation.--The Administrator shall establish
      procedures for actively seeking from nongovernment persons innovative
      technology concepts relating to the provision of space hardware,
      technology, or services to the National Aeronautics and Space
      Administration, and for the evaluation of such concepts by the National
      Aeronautics and Space Administration's Advisory Council against mission
      requirements.
          (3) Requirement.--At least 10 percent of amounts authorized to be
      appropriated for Commercial Programs, Research and Development, for each
      fiscal year shall be used for innovative technology procurements that are
      determined under paragraph (2) to meet mission requirements.
          (4) Special authority.--Notwithstanding any other provision of
      Federal law or regulation, in order to carry out this subsection the
      Administrator shall recruit and hire for limited term appointments
      persons from the nongovernmental sector with special expertise and
      experience related to the innovative technology concepts with respect to
      which procurements are made under this subsection. Further, in carrying
      out this subsection the Administrator may waive--
              (A) Federal Acquisition Regulations;
              (B) Military Specifications; and
              (C) cost data requirements.
      (b) Report.--The Office of Space Commerce shall, within 6 months after
  the date of enactment of this Act, submit a report to the President and the
  Congress containing recommendations for procuring space infrastructure, space
  launch and launch support facilities, and payloads using proof of concept
  methods and unsolicited proposals. In preparing such report, the Office of
  Space Commerce shall consult with appropriate persons in the private sector.

  SEC. 509. LAND REMOTE SENSING POLICY ACT OF 1992 AMENDMENTS.
      Section 105(a) of the Land Remote Sensing Policy Act of 1992 is amended--
          (1) by striking paragraphs (1), (3), and (4);
          (2) by redesignating paragraphs (2), (5), and (6) as paragraphs (3),
      (4), and (7), respectively;
          (3) by inserting before paragraph (3), as so redesignated, the
      following new paragraphs:
          "(1) define the roles and responsibilities of various public and
      private sector entities that would be involved in the acquisition,
      processing, distribution, and archiving of Landsat 7 data and in the
      operations of the Landsat 7 spacecraft;
          "(2) ensure that unenhanced data shall be provided to the United
      States Government and its affiliated users at the cost of fulfilling user
      requests, and that such data may be reproduced and disseminated to other
      Federal agencies and affiliated users, on the condition that such
      unenhanced data is used solely for noncommercial purposes;";
          (4) in paragraph (4), as so redesignated by paragraph (2) of this
      section, by striking "and" at the end; and
          (5) by inserting after such paragraph (4) the following new
      paragraphs:
          "(5) ensure that instructional data sets, selected from the Landsat
      data archives, shall be made available to educational institutions
      exclusively for noncommercial, educational purposes at the cost of
      fulfilling user requests;
          "(6) ensure that the proposed data distribution system contributes to
      the goal of the commercialization of land remote sensing; and".
 
  SEC. 510. LAND REMOTE SENSING FOR AGRICULTURAL MANAGEMENT.
      (a) Findings.--The Congress finds that--
          (1) the use of land remote sensing data is potentially a valuable
      resource to the agricultural community;
          (2) land remote sensing data can inform the agricultural community as
      to the condition of crops and the land which sustains those crops;
          (3) land remote sensing data can be useful for farmers engaged in
      prescription farming;
          (4) land remote sensing data on agricultural conditions can be
      valuable, when received on a timely basis; and
          (5) the National Aeronautics and Space Administration, using the
      expertise of the Earth Observations Commercialization Applications
      Program, and the Department of Agriculture should work in tandem to aid
      farmers to obtain data which would be conducive to sound agricultural
      management and greater crop yields.
      (b) Definitions.--For the purposes of this section--
          (1) the term "Administrator" means the Administrator of the National
      Aeronautics and Space Administration;
          (2) the term "prescription farming" means a method by which farmers
      can regulate the application rates of pesticides, nutrients, and water,
      among other inputs, to farmlands in the exact amount necessary to
      maximize crop yield, without harming the environment; and
          (3) the term "data voucher" means a grant to enable farmers to
      purchase land remote sensing information from commercial entities.
      (c) Data Vouchers.--The Secretary of Agriculture and the Administrator
  shall jointly develop a mechanism to provide farmers with data vouchers. Data
  vouchers shall be distributed to farmers through the Agricultural Extension
  Service, which shall contract with commercial entities to provide farmers
  engaged in prescription farming with timely data on crop conditions,
  fertilization and irrigation needs, pest infiltration, and soil conditions.
      (d) Training.--The Secretary of Agriculture and the Administrator shall
  jointly establish a program to train farmers in the use and interpretation of
  land remote sensing data for prescription farming.
      (e) Authorization.--Funds necessary for carrying out this section shall
  be derived from funds otherwise authorized for the Agricultural Extension
  Service.
      (f) Sunset.--The provisions of this section shall expire 5 years after
  the date of enactment of this Act.
 
  SEC. 511. SUNSET.
      Sections 102(b), 501, 502, 503, and 505 shall expire 15 years after the
  date of enactment of this Act.