NASA contracts soaring

Indiana’s share of NASA spending amounts to little more than a shiny penny at the bottom of a clothes dryer. Only $130
million made its way to the state in 2007—virtually nothing compared to the $12 billion the space
agency doled out to all states and the $5 billion Indiana companies snagged from the U.S. Department
of Defense.

But like a
rocket straining to get off a launch pad, the state is gaining momentum—more than doubling the value of the contracts
in the past five years.

"In Indiana, we get a smaller amount of NASA dollars compared with other areas of the country, but that’s growing and
we need to do a whole lot [more] work," said Brian Tanner, president of Space Port Indiana, which
next month plans s to fire off a Hoosier-built, single-stage rocket capable of carrying a commercial
payload.

The rocket isn’t
a NASA project, but the Carmel company that’s building it, Technology Management Group Inc., wouldn’t have
developed the skills without the NASA grants it pulls down.

Tanner won’t disclose the potential customers, and the rocket isn’t expected to even fly as high
as a commercial jet. Nevertheless, after blasting off from the pad at Columbus Municipal Airport, it
will encounter the hostile environmental conditions useful to drug makers and other companies.

If Indiana still seems far out of the loop as
a place for space-related research and development, well, it is. Texas swept e in $3.5 billion in 2007,
and California, $1.6 billion.

However, Indiana stacked up well against many neighboring states. Illinois received only $27 million. Ohio, where NASA operates
a number of facilities, did best in the Midwest, at $237 million.

Jason Lovell, manager of the state’s Defense Development Division, said Indiana has strong potential
to commercialize NASA work and grow aerospace jobs.

So far, most of the benefit has gone to a handful of companies and universities.

Raking in the most contracts from 2002 to 2006
was ITT Industries Inc. in Fort Wayne, which received a total of $315 million, according to the Indiana
Defense Asset Study, released in 2007 by the Central Indiana Corporate Partnership.

ITT’s big take was followed by the Indianapolis aircraft engine division of Rolls-Royce, at $148.7
million. Next came Purdue University’s $13.5 million and the $3.5 million directed to Indiana University.

Actual dollar volume flowing from NASA contracts
is hard to pin down, however, said Rolls-Royce’s former chief operating officer in Indianapolis, Steve
Dwyer. That’s because some of the work is subcontracted from other companies that receive prime contracts.

Purdue, for example, received $7.6 million instead
of just $4.3 million in 2008 after adding in subcontracts.

"It’s a very nice trend. What’s nice about it is that it’s a myriad of projects," said
John A. Schneider, Purdue assistant vice president for industry research.

Purdue ranked 79th in NASA dollars flowing to universities in 2007. IU was 95th.

Much of Purdue’s funding has come from NASA’s
work to produce environmental systems for long-term moon and Mars missions. To that end, Purdue in recent
years has developed water- and waste-processing systems.

"We’ve learned a lot in this area that can be transferred to water processing systems"
on the ground, Schneider said.

Other Purdue research stemming from a NASA grant relates to using waste heat from power plants to grow food. The grants have
unquestionably benefited academics, Schneider said, given that the university’s research efforts are student-based.

"We really have to figure out how to use
this to benefit the economy and the state" more, he said.

Just how many NASA contracts will be available in coming years is uncertain. As of late last month,
Congress hadn’t passed its fiscal 2009 appropriation. Scott Pace, director of the space policy institute
at George Washington University, said $2 billion might be added to the $19 billion budget.

The recent federal stimulus bill added $600
million for NASA, mostly for environmental and aeronautics needs.

"I see NASA’s longer-term outlook generally being stable, with perhaps modest growth,"
Pace said. "Any new growth in an agency top-line most likely would go to projects in Earth sciences
and aeronautics—but I would also hope to see an acceleration of the effort to create a replacement
for the [space] shuttle in terms of U.S. human access to space."

Lovell, the state’s defense development point person, said NASA’s plans for a shuttle replacement
as well as missions late in the next decade to the moon—and eventually Mars—could bring more
contracts.

The Indiana
Defense Asset Study, in which he participated, cited experts who noted growing pressure from scientists to rebalance
NASA from human exploration to science.

"Such a change could favor the state of Indiana as [industry and academia] have been participating in science and robotic
activity, rather than exploration," the report said.

It also noted potential for China’s ramping up its space program. China took a giant leap in 2003
with its fi rst manned flight by Yang Liwei, who declared, "I will not disappoint the motherland."

For anyone alive in the 1960s, that evokes memories
of Soviet zeal for blazing scientific and propaganda frontiers.

If China follows in manned space flight, "it could ignite another space race, and considerable
assets could be redirected toward NASA," the Indiana study said.