Voters urged to pass longer tax exemption for aerospace companies

Posted Thursday, Oct. 17, 2013  comments  Print Reprints

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Former U.S. Deputy Secretary of Defense Gordon England is urging voters to support a November referendum that would permit aerospace companies to extend a tax exemption on equipment and heavy parts inventory for two years.

Proposition 3 will appear on the Nov. 5 ballot. It would create a constitutional amendment that increases the number of days that local aerospace businesses could store parts, machinery and heavy equipment without taxation. Aerospace manufacturers depend on storage of large equipment to build aircraft engines and other products.

The current law allows for local governments to adopt a freeport tax exemption, which permits local companies to exempt equipment and heavy machinery from taxation for up to 175 days. If approved, the constitutional amendment would extend that period to up to two years.

Aerospace is “the jewel in the state of Texas,’’ said England, who spoke Thursday at the Aviation & Aerospace Industry Manufacturing Summit hosted by Embry-Riddle Aeronautical University in north Fort Worth. “It’s important that we protect and nurture this business here in the state of Texas.”

Extending the Freeport Tax Exemption to two years “doesn’t cost anyone anything,’’ England said.

In fact, the current 175-day cap on the tax exemption puts Texas at a “competitive disadvantage because companies now have their large inventories out of state,” said England, who served as the top executive for General Dynamics at the west-side fighter jet plant that now owned by Lockheed Martin Aeronautics.

State Rep. Linda Harper-Brown, R-Irving, sponsored the bill to call for the referendum. It was passed by the Texas Legislature this year.

Robert Hastings, senior vice president of communications at Bell Helicopter, also urged voters to support Proposition 3.

“Our products and inventories stay with us for a long time,’’ Hastings said. Bell’s manufacturing cycle on some of its products is up to 27 months, for example.

After the plug for Prop. 3, England addressed a group of about 100 aviation enthusiasts, including officials from Tarrant County’s top two aerospace employers — Lockheed Martin and Bell Helicopter, which employ more than 20,000 workers locally.

The defense icon and electrical engineer traced his roots to Fort Worth, where he started in 1966 as a “junior engineer,” he said. “It’s amazing that in 1991, I became president of the company.”

England also spoke of his contributions in developing the F-16 aircraft “built here in Fort Worth,’’ he said.

The Benbrook resident said he believes that the F-35 Joint Strike Fighter Lightning II, under development by more 6,000 workers at Lockheed in Fort Worth, will likely be the last “manned fighter you’re ever going to to see.”

“The world has changed a lot,” England said. “There is far more complexity.”

England also focused on the need for the U.S. to step up its competition in aerospace manufacturing. It ranks fifth in the world after China, India, Brazil and Germany in that area, he said.

“We have a lot of challenges,’’ he said.

In addition, the U.S. needs to step up math and science education at its elementary and secondary schools, he said. U.S. students are 25th in the world in math and science education, he said.

A third of high school students in the U.S. drop out of school, he said. In order to draw more students to STEM (Science Technology Engineering and Math) education, England says high schools have to ignite an excitement for mathematics courses.

High schools need to come back to providing hands-on science education in auto mechanics. The schools need to develop hands-on projects for young students, for example. England’s first exposure to science and engineering came as a high school student, he said, when he learned how to be a ham-radio operator.

Students today are hungry for those hands-on experiences, he said.

“You’re about to see changes in terms of how we teach,’’ England said. “I think we will learn more about how the brain works and how we learn.”

Yamil Berard, 817-390-7705 Twitter: @yberard

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