With Virgin Galactic’s ‘big move” of its SpaceShipTwo to New Mexico expected to occur sometime in 2018, Spaceport America officials say they need taxpayers to ante up more money.
Dan Hicks, Spaceport America CEO, told attendees at the Greater Las Cruces Chamber of Commerce 2017 Space Update Luncheon on Thursday that more spaceports are poised to enter the commercial space industry, with 10 other licensed spaceports operating and an additional nine applications pending with the Federal Aviation Administration. And, with Virgin Galactic set to begin manned flights as soon as next year, more funding is needed to accommodate the increased traffic expected to follow, he said.
Hicks said he will seek an additional $600,000 from the Legislature to increase staff levels and continue with infrastructure improvements. At a cost of nearly $220 million, the taxpayer-financed Spaceport America opened in 2011. At the time, officials envisioned a new commercial space economy that would transform southern New Mexico. That economy has yet to come to fruition, but officials are hopeful.
The funding is necessary to stay on par with other spaceports around the country, Hicks said. With 16 people currently on the Spaceport America staff, Hicks hopes to increase that number to 26 “very quickly” to accommodate Virgin Galactic’s planned move to New Mexico….
New Mexico’s Spaceport America has a $6.1 million operating budget with a current state appropriation of $375,000 with $600,000 in local gross receipts taxes generated solely from Doña Ana and Sierra counties. Customer revenue generates $2.1 million.
The tax increase that Sierra County voters approved in 2008 to support the construction of Spaceport America has no expiration date and no restrictions on the use of excess revenues that might be collected each year, according to the ordinance passed by county commissioners.
The tax that residents of Dona Ana County voted to impose upon themselves to help fund the development of Spaceport America has no expiration date, meaning it could continue indefinitely after bonds used to pay for the construction are paid off in 2028, according to a review by KRWG TV/Radio.
Critics of the spaceport have said the .25 cent increase in the gross receipts tax should end after the construction bonds are paid off. They have also objected to the use of taxes in excess of what is needed to pay off the bonds to plug holes in the spaceport’s budget. They want the money to be used to pay off the bonds early.
KRWG’s Fred Martino did something that apparently had not occurred to anyone: he dug up the 2007 ordinance that county commissioners approved for the tax. The document has no expiration date and no restrictions on using revenues for spaceport operations.
To change the situation, county commissioners would need to pass an ordinance ending the tax and restricting the use of surplus tax revenues for operations.
New Mexico Spaceport Authority (NMSA) CEO Dan Hicks said he needs the tax to continue so the authority will have funding to expand the spaceport and attract new tenants to it. Spaceport America is in stiff competition with other spaceports around the country, he said.
NMSA has struggled financially due to years of delays by anchor tenant Virgin Galactic in flying suborbital space tourist flights from the southern New Mexico facility.
Sierra County voters also approved a similar tax increase to help pay for the spaceport.
The story mostly features interviews with Virgin Galactic officials outlining their plans to start commercial operations from New Mexico. There will be a series of additional flight tests in Mojave, Calif., and then SpaceShipTwo will move down to Spaceport America for some additional tests before the start of commercial flights. Richard Branson has been prediction ticket holders will start flying in 2018.
In other words, nothing we haven’t been hearing for years and years, albeit with a shiny new set of dates.
Picking up on a theme covered in the third installment, this story details the lengths to which Spaceport America officials have gone to keep secret details of deals they have concluded with tenants.
“If you were to ask them would they want their leases out in the public they would say no,” [New Mexico Spaceport Authority CEO Dan] Hicks said. “…We just don’t want to have additional burdens on them or scrutiny on them.”
That’s a controversial stance in a poor state that has invested more than $220 million in Spaceport America – a state whose law intends that the public be given access to “the greatest possible information regarding the affairs of government,” which it calls “an essential function of a representative government.”
There’s a real tension created by the public/private partnership that is the spaceport. On one hand, greater secrecy may help attract companies that demand it, and with them may come good-paying jobs the state needs. On the other hand is the principle that opening the spaceport’s finances builds accountability and public trust that is key to winning the government funding on which the spaceport also depends.
Senate President Pro Tem Mary Kay Papen, D-Las Cruces, sponsored legislation on behalf of the spaceport earlier this year that would have let the agency keep rent payments, trade secrets and other information secret. One committee approved the bill, but then it died.
These days Papen says she supports withholding company trade secrets from the public. But she no longer backs secrecy for money coming into the spaceport from private companies.
The spaceport authority didn’t always keep agreement terms secret. For example, Virgin Galactic’s development and lease agreements were released years ago without anything being redacted.
The situation is different at the Mojave Air and Space Port, which is a public general aviation airport run by an elected board. Lease agreements are included in board packets that are available to the public.
The fifth and final installment looking at anchor tenant Virgin Galactic’s preparations for space tourism flights from Spaceport America will be published on Friday.
The third installment of NMPolitics.net’s report on Spaceport America was published today: Transparency problems plague Spaceport America. The story details the problems the author has experienced getting information about Spaceport America’s operations from the New Mexico Spaceport Authority.
Spaceport America is a publicly owned government entity, so the law requires its financial and other dealings to be open to the public, with few exceptions.
And yet in 2017 the N.M. Spaceport Authority, the state agency that runs the spaceport, has violated the state’s transparency laws several times in response to requests for documents filed by NMPolitics.net, a citizen from Truth or Consequences, and a reporter with KTSM-TV in El Paso. Those violations, in addition to other possible infractions, blocked or delayed public access to information about the spaceport….
The Spaceport Authority blacked out information in some lease agreements with aerospace companies it provided to NMPolitics.net, including rent and fee schedules. That was done to “honor the rights that New Mexican state law provides to innovators, developers and entrepreneurs who seek to move their operations to our state,” said Melissa Kemper Force, the agency’s general counsel.
The violations and possible violations of transparency laws started in March when I and Patrick Hayes, the KTSM-TV reporter, asked for copies of the spaceport’s lease agreements with aerospace companies. I paid the fee of nearly $300 for copies of the documents. Hayes asked to bring his own equipment to digitize the records himself for free, which the state Attorney General’s Office says is allowed.
The Spaceport Authority rejected Hayes’ request, leaving him only the option of paying the $1-per-page fee if he wanted copies.
The Mojave Air and Space Port is governed by a five-member board elected by the local population. Lease agreements are included as part of meeting agendas that are published on the spaceport’s website. The board approved an amendment to Virgin Galactic’s lease of a test site earlier this month. See pages 16-17 of the document below.
This one deals with financing at Spaceport America. It requires a bit of understanding of the history of how it was funded.
So, here’s the back story: In 2007 and 2008, residents of Dona Ana and Sierra counties approved a quarter cent increase in the sales tax to help pay for the construction of Spaceport America, where billionaire Richard Branson plans to send rich people on suborbital joy rides.
The piece is fairly optimistic on the financial front, perhaps too much so. It examines positive financial impact on the local economy to date and projects forward to when Virgin Galactic begins flying commercially from the facility, possibly next year. (more…)
Plans for a visitor’s center at Spaceport America have continued to shrink due to a lack of funding and revenues. And that could pose significant risks to New Mexico’s plans to boost the local economy by attracting more than 200,000 visitors to the remote facility where Virgin Galactic plans to launch tourists into space.
In fact, the New Mexico Spaceport Authority appears to be going down the very path that its own Strategic Business Plan warns will result in a poor visitor experience and fewer tourists paying money to see the high-tech spaceport.
The New Mexico Senate Corporations and Transportation Committee has endorsed a bill that would prohibit Spaceport America from using excess taxes collected from Dona Ana and Sierra counties to fund its operations.
The measure, introduced by Republican Sen. Lee Cotter of Las Cruces, would require that funds collected from gross receipts taxes to pay off construction bond debt. Operational money would have to come out of the general state budget.
Residents of the two counties voted to impose a tax increase on themselves to help fund the $212 million spaceport located near the town of Truth or Consequences.
New Mexico Spaceport Authority (NMSA) Executive Director Christine Anderson, which oversees the spaceport, said she was disappointed in the committee’s decision.
Anderson said the measure, if approved by the Legislature, would cost the agency about $700,000 at what she called a “critical moment” for the Spaceport.
“That money has been acting as a lifeline for the Spaceport,” Anderson said. “If this bill is passed what I would need to do is go to the Legislature and ask the senators who voted for this bill if they will add the money to the authority’s budget at the cost to all the taxpayers in New Mexico. And that’s something I don’t want to do.”
Virgin Galactic, which is Spaceport America’s anchor tenant, is behind schedule on beginning commercial operations of its SpaceShipTwo suborbital tourism vehicle from New Mexico. This has limited the revenues that NMSA can collect to maintain its operations.
Construction of Spaceport Unit Will Resume Albuquerque Journal
Construction of an aircraft rescue and firefighting building at Spaceport America, stalled since November, is scheduled to resume within three weeks.
The Spaceport Authority’s former executive director, Rick Homans, halted work on the $2.9 million building because of concerns about how the first-floor space would be used and whether it was sufficient to meet the needs of future tenants. The project had been launched by Homans’ predecessor Steve Landeene.
New Spaceport Authority executive director Christine Anderson said she lifted the stop-work order on March 11 after determining “that the original design was fine and we would move forward.”