OKLAHOMAS AEROSPACE INDUSTRY

Please Support Senate Bill 3 (Mazzei), which would reinstate the Aerospace Engineer Workforce and Recruitment Incentives. Heres why:
The Aerospace Industry is one of Oklahomas top 3 economic engines Aerospace companies employ 74,000 direct jobs in Oklahoma, yielding an annual payroll of just under $5 billion The industry creates an additional 70,000 indirect jobs, for a "Qualified engineers are a major component of the Spirit total of 144,000 aerospace-related jobs in Oklahoma workforce. We have For each new engineering job created in the aerospace participated in the aerospace industry, an additional 2 jobs are projected to be created in tax credit program since its inception, hiring engineers Oklahoma Aerospace companies pay an average salary in Oklahoma of from the University of $55,000, compared to the average salary for all industries Oklahoma and Oklahoma State University. It has been a key to both private and public of $30,000 building our workforce in Tulsa Aerospace has an economic output of $12.4 billion, 10 and McAlester. The aerospace percent of Oklahoma's economy tax credit stands alone as a great recruitment tool for Oklahoma." Aerospace companies use these credits only AFTER they have hired new engineers, proving it is a true measure of new Deborah Gann, SPIRIT AEROSYSTEMS, INC. jobs created Companies utilized the Aerospace Engineering tax credit to hire 348 engineers in 2009, the only year it was fully applied before the moratorium; the fiscal impact to the state of the engineer credit was $3.5 million, but the direct impact to Oklahomas economy resulting from the hiring of the engineers was $270 million The hiring of 348 engineers is estimated to create a total increase in payroll of $50.7 million Aerospace companies require a pipeline of skilled workers, especially engineers, to continue that level of economic output Aerospace companies expect to have an shortage of at We currently have a pressing need for least 600 engineers by 2014 according to the Governors at least 50 engineers who will design Workforce Council next generation programs that will Aerospace companies only have about 110,000 U.S. drive manufacturing activity for the engineers to draw from for jobs, compared to 600,000 in next decade. Several hundred more jobs will be needed to support these China and 350,000 in India design programs production phases Aerospace has the largest trade surplus of any in Oklahoma. The aerospace tax credit manufacturing industry for the last 5 years, averaging is a critical component of NORDAMs business case to place these jobs in the $57B per year
Tulsa-area and vital to our States competiveness now and in the future.

T. Hastings Siegfried, NORDAM

The Oklahoma Aerospace Engineering Tax Credit was one of the key elements contributing to the business case analysis that resulted in our decision to relocate 550 positions to Oklahoma City. This program is unique in the country, giving Oklahoma a distinct competitive advantage. Restoration of this tax credit will positively influence ongoing business case analyses to find best value approaches to address our customers requirements.

Steve Hendrickson, THE BOEING COMPANY

TIMELINE:
Legislature Passes Incentives to lure Aerospace Engineers HB 3239 (McNiel, Corn) granted a tax credit equal to 50 percent of the tuition reimbursed to qualified employees in the aerospace sector for the first through fourth years of employment The credit could be claimed only if the employee has been awarded an undergraduate or graduate degree within one year of employment with a qualified employer The law also grants a tax credit for compensation paid to a qualified employee The law provides a maximum $5,000 tax credit for up to five years for qualified employees Oklahoma Reaps Benefits for Aerospace Industry While Kansas was laying off 16,000 aerospace workers, Oklahoma had net job growth in its aerospace industry Tinker Air Force Base is in the midst of hiring 1,200 workers and Spirit AeroSystems has hired 400 since November There is no question that the incentives provided to engineers hired by aerospace companies and the companies hiring them played a critical role in their employment Tinker AFB, the worlds largest military aircraft repair facility and Oklahomas largest single-site employer with 28,000 employees, benefited the most from the aerospace tax credits, hiring approximately 60 engineers Spirit AeroSystems has been the primary beneficiary in the private sector, hiring nearly 30 engineers These jobs help ensure the viability and growth of an economic engine that has helped Oklahoma weather the economic storm better than most states and much better than the state did in the 1980s when Oklahomas economy was largely dependent mostly on the oil and gas sector Moratorium placed on Aerospace Engineer Workforce and Recruitment Incentives SB 1267 put in place a moratorium on 30 separate tax credits, which was a part of the $6.7 billion budget agreement reached in late May between Governor Henry and legislative leaders. In the final hours of session, tax credits for wind power, historic renovation projects, coal and business investments were still subject to the two-year moratorium, but were able to be deferred and banked The Aerospace Engineer Workforce and Recruitment Initiatives were not spared and were not given the same deferment opportunities Seeking Reinstatement of the Aerospace Engineer Workforce and Recruitment Initiatives This vital economic development tool has led several aerospace companies to hire more engineers and consider Oklahoma for the location of additional operations for their companies The moratorium has sent a terrible message to the aerospace industry that we do not want them to grow or expand in Oklahoma. For example, Boeing has several active studies evaluating high-cost locations to see it makes business sense to relocate them and the moratorium of this tax credit is having a negative impact on the business case analysis The Aerospace tax credits meet all of the criteria outlined in the recently-released attorney general opinion to ensure constitutionality

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