Yesterday, the Texas House Committee on Defense & Veteran Affairs along with the Committee on Economic & Small Business Development held a joint hearing on the economic impact of the aviation, aerospace and defense manufacturing industry in Texas and the state’s ability to facilitate industry job growth and investment. Our 2018 Aerospace Committee Chair, Tyler Schroeder, Senior Manager of State and Local Government Operations at The Boeing Company, joined Chamber members and other esteemed colleagues in testifying.
The message received was loud and clear – Texas is losing ground as one of the most attractive states to conduct Aerospace & Defense business. The recurring issue from everyone’s testimony was the state’s current tax environment.
On the issue of taxes, Tyler’s testimony touched on the need to conform the franchise tax to Federal Acquisition Regulation (FAR) to ensure future growth. Tony Bennett, President and CEO of Texas Association of Manufacturers, stated, “It is more about tax equity and fairness,” and shared further testimony about other barriers for aerospace businesses to grow and relocate to Texas.
The committees also heard similar testimony from Dana Schenck, representing Bell, Textron Inc. As one of our industry leaders in Texas, Bell’s operations support nearly 20,800 jobs and contribute $4.5 billion per year toward the Texas economy. Becky Redman, Manager of Government Relations for Lockheed Martin Aeronautics, gave several examples of the impact Lockheed Martin Aeronautics has on our economy alone. Lockheed employs more than 18,000 employees statewide with a payroll of $2.4 billion dollars, many of them veterans. Their presence contributes to over 2.11 billion into the Texas economy. Aimee Gilroy, Senior Manager of State Government Relations for Raytheon Company explained, “Bringing the franchise tax into conformity with federal acquisition regulations will ensure a competitive market for our companies to continue innovating and manufacturing in Texas.”
However, there was praise given to Texas for setting the bar when it comes to the relationship between industry and military veterans transitioning into the workforce. Tyler Schroeder proudly answered, “Pulling from the natural talent pipeline in the region, Boeing hired many veterans to fill jobs that were lost with the base closure.” This partnership created between Port San Antonio, industry, and our military services is only one example of Texas pulling from our own local resources.
The presence of these industry giants affects small businesses through supply chains and by charitable contributions. Combined, the aerospace and manufacturing presence contributes billions back into our educational systems and charitable causes. As the other 49 states compete for our dollars, the time is now, to make the corrections necessary for Texas to regain the momentum as the most attractive place for continued, and future business.