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 Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ‘‘Omnibus Space Com-
mercialization 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 com-
mercial launch facilities, in order to ensure United
States economic preeminence in space;
(6) creation of a space infrastructure and trans-
portation industries in a timely, profitable, innova-
tive, 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 adapt-
ed 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 vehi-
cles 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, process-
ing, service, and other associated and support activi-
ties;
(7) the term ‘‘space transportation services’’
means the preparation of a space transportation ve-
hicle 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 op-
erating in, or transporting a payload to, from, or
within, outer space, or in suborbital trajectory, and
includes any component of such vehicle not specifi-
cally 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 pos-
session 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 evi-
denced a substantial commitment to the
United States market through—
(I) investments in the United
States in long-term research, develop-
ment, 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 de-
scribed in subparagraph (A) comparable to
that afforded to such foreign company’s
subsidiary in the United States, as evi-
denced by—
(I) providing comparable oppor-
tunities 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 com-
panies described in subparagraph (A)
with respect to local investment op-
portunities that are not provided to
foreign companies in the United
States; and
(III) providing adequate and ef-
fective protection for the intellectual
property rights of companies de-
scribed 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 sec-
tions 2 through 6 of the National Cooperative Re-
search Act of 1984 (15 U.S.C. 4301 through 4305),
and includes section 5 of the Federal Trade Com-
mission 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 con-
duct a comprehensive inventory of all space launch and
launch support facilities owned by the United States Gov-
ernment 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 De-
fense, the National Aeronautics and Space Administra-
tion, 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 inven-
tory and identification required under subsection (a), in-
cluding 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 Gen-
eral Services Administration for disposition.
SEC. 102. COMMERCIAL SPACE CENTERS.
(a) DESIGNATION.—The Secretary shall establish cri-
teria for the designation of Commercial Space Centers.
The Secretary shall, in accordance with such criteria, des-
ignate appropriate launch facilities as Commercial Space
Centers.
(b) BENEFITS OF DESIGNATION.—Commercial Space
Centers, all property located therein, all space transpor-
tation services and space-related activities carried out
therein, and all products and services created, processed,
manufactured, or otherwise arising from such space trans-
portation services and space-related activities, including
such services and activities in space as are launched from
a Commercial Space Center and products created, manu-
factured, or processed in connection therewith, and pro-
ceeds 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 facili-
tate proposals by commercial providers, with or without
the participation of State and local governments, to estab-
lish new space launch and launch support facilities on pub-
lic lands administered through their respective depart-
ments through sale, lease, grant of overflight and clear-
ance 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 submis-
sion 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 sub-
section (a).
(2) Overflight easements for extra-atmospheric flight
may be granted over such areas if the Secretary of Trans-
portation 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 ease-
ments shall be granted wherever practical to link such
parcels.
(e) COMPATIBLE USES.—Proposers shall be encour-
aged to submit proposals compatible with—
(1) existing uses, including livestock grazing,
mining, and forest activities;
(2) scientific activities, including aircraft re-
search 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 Adminis-
trator of the National Aeronautics and Space Administra-
tion (hereafter in this section referred to as the ‘Adminis-
trator’), or the Secretary of Defense, as the case may be,
determines that—
‘‘(1) the payload requires the unique capabili-
ties 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 sci-
entific opportunity; or
‘‘(4) the payload serves national security or for-
eign 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 Commit-
tee on Commerce, Science, and Transportation of the Sen-
ate 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 ac-
quiring, 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 pro-
vide launch services to the Federal Government under sec-
tion 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 sec-
tion 311 of the National Aeronautics and Space Act of
1958.
‘‘(2) Submission of cost or pricing data for the pur-
pose 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 tech-
nical standards as set forth in the original solicitation is
received.
‘‘(b) SPECIFICATION
SYSTEMS.—Reasonable per-
formance specifications, rather than Federal civilian or
military design or construction specifications, shall be
used to the maximum extent feasible to define require-
ments 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 pur-
posefully, 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 de-
signed 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 ‘‘sec-
tion 4(11)’’ each place it appears and inserting in
lieu thereof ‘‘section 4(12)’’;
(4) in section 6(a)(3)(A), by inserting ‘‘or re-
entry’’ 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 in-
serting 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 ‘‘pre-
vent the launch’’;
(B) by striking ‘‘holder of a launch li-
cense’’ and inserting in lieu thereof ‘‘licensee’’;
and
(C) by inserting ‘‘or reentry’’ after ‘‘deter-
mines 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 insert-
ing in lieu thereof ‘‘for reentering one or more re-
entry 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 re-
entry 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 re-
entry’’ 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 ‘‘en-
sure that the launches’’;
(B) by inserting ‘‘or reentry date commit-
ment’’ after ‘‘launch date commitment’’;
(C) by inserting ‘‘or reentry’’ after ‘‘ob-
tained 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 re-
entry’’ 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 insert-
ing ‘‘or reentry’’ after ‘‘any particular launch’’ each
place it appears;
(20) in section 16(a)(1) (C) and (D), by insert-
ing ‘‘or a reentry’’ after ‘‘launch services’’ each place
it appears;
(21) in section 16(a)(2), by inserting ‘‘or re-
entry’’ 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 re-
entry’’ 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 re-
views the performance of the regulatory activities and the
effectiveness of the Office of Commercial Space Transpor-
tation.
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 Inno-
vation 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 au-
thority of this or any other appropriate Act,’’; and
(2) in subsection (d)(1) by inserting ‘‘intellec-
tual property,’’ after ‘‘equipment,’’ both places it
appears.
TITLE IV—TAX INCENTIVES FOR
COMMERCIAL SPACE ACTIVI-
TIES
SEC. 401. SHORT TITLE.
This title may be cited as the ‘‘Space Business Incen-
tives Act of 1993’’.
SEC. 402. DEDUCTION FOR PURCHASE OF COMMERCIAL
SPACE CENTER STOCK.
(a) IN GENERAL.—Part VI of subchapter B of chap-
ter 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 al-
lowed as a deduction under subsection (a) to a tax-
payer 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 sec-
tion 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 ex-
change, the amount realized, or
‘‘(II) in the case of any other disposi-
tion, 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 in-
creased by the Commercial Space Center stock
recapture amount.
‘‘(B) COMMERCIAL SPACE CENTER STOCK
RECAPTURE
AMOUNT.—For purposes of sub-
paragraph (A), the term ‘Commercial Space
Center stock recapture amount’ means an
amount equal to the amount of interest (deter-
mined 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 deduc-
tion 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 be-
fore 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 tax-
able 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 (deter-
mined 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 deduc-
tion 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 quali-
fied 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 re-
spect 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 com-
mon stock issued by a qualified issuer but only if the
proceeds of such issue are used by such issuer to es-
tablish 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 busi-
ness 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 sec-
tion 52, or
‘‘(B) in the case of individuals, such per-
sons are husband and wife.
‘‘(f) SPECIAL RULES.—
‘‘(1) AMOUNT PAID AFTER CLOSE OF TAXABLE
YEAR.—An amount paid after the close of the tax-
able year for the purchase of Commercial Space
Center stock shall be treated for purposes of sub-
section (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
DEDUC-
TION.—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) 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 COR-
PORATION 
SUBSTANTIALLY 
ENGAGED 
IN
SPACE-RELATED ACTIVITIES.
(a) IN GENERAL.—Part III of subchapter B of chap-
ter 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 insert-
ing after section 136 the following new section:
‘‘SEC. 137. GAIN ON SPACE CORPORATION STOCK.
‘‘(a) GENERAL RULE.—Gross income shall not in-
clude 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 tax-