No End in Sight for Spaceport America Tax

Sunset at the “Virgin Galactic Gateway to Space” terminal hangar facility at Spaceport America. (Credit: Bill Gutman/Spaceport America)

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.

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NASA Space Act Agreements with Virgin Galactic, Moon Express, NanoRacks and More

NASA has released a document listing the 1,206 active Space Act Agreements  (SAAs) the agency has with commercial companies, non-profit organizations and state and local governments.

From that list, I’ve extracted agreements with individual companies. Below you will find tables listing SAAs that NASA has signed with Virgin Group companies, Moon Express and NanoRacks. There is also a fourth table that has SAAs with a number of companies and organizations that we follow on Parabolic Arc.

SAAs come in three varieties: reimburseable, non-reimburseable and funded. Under reimburseable agreements, a company or organization will pay NASA for its services. No money exchanges hands under non-reimburseable agrements. And under funded agreements, NASA pays the company to perform work or provide services. (The space agency made substantial use of SAA’s in the Commercial Crew Program.)

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Dona Ana County Residents Could End Up Paying for Spaceport Indefinitely

Sunset at the “Virgin Galactic Gateway to Space” terminal hangar facility at Spaceport America. (Credit: Bill Gutman/Spaceport America)

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.

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Investigative Series on Spaceport America Ends With a Whimper

SpaceShipTwo glides over the Mojave Desert after being released from its WhiteKnightTwo mother ship. (Credit; Virgin Galactic)

The fifth and final installment of NMPolitics.net’s series on Spaceport America was published today: After years of delays, Virgin Galactic prepares for spaceflights from NM

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.

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How Much Secrecy Does Spaceport America Need?

Richard Branson and his children hang out with Project Bandaloop dancers during the dedication of the Virgin Galactic Gateway to Space facility. (Credit: Douglas Messier)

The fourth installment of NMPolitics.net’s five-part series on Spaceport America was published today. How much secrecy does Spaceport America need?

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.

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Spaceport America Not Very Transparent With Public

The Terminal Hangar Facility at Spaceport America will house Virgin Galactic’s WhiteKnightTwo and SpaceShipTwo. (Credit: David Wilson, Spaceport America)

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.

http://www.mojaveairport.com/uploads/5/7/8/9/57893503/08.01.17_packet.pdf

Spaceport America Risks Becoming Even Bigger Money Pit

The Virgin Galactic Gateway to Space terminal hangar facility (center), Spaceport Operations Center (Left) and “Spaceway”
(Runway) at Spaceport America. (Credit: Bill Gutman/Spaceport America)

The second installment of NMPolitics.net’s five-part series on Spaceport America dropped today. Funding woes could ‘cripple’ NM spaceport as other states invest in space race

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.

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Series on Spaceport America Looks on the Bright Side

Sunset at the “Virgin Galactic Gateway to Space” terminal hangar facility at Spaceport America. (Credit: Bill Gutman/Spaceport America)

NMPolitics.net began a five-part series on Spaceport America today. Is Spaceport America taking flight? is the first installment.

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.
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Mojave: The Once and Future Spaceport

Sunset from the Mojave Air and Space Port on Oct. 30, 2014. (Credit: Douglas Messier)

At some point in the next six months, the Mojave Air and Space Port could experience something that not happened here in 13 long years: an actual spaceflight.

Richard Branson is predicting that Virgin Galactic’s SpaceShipTwo Unity could reach space on a flight test from Mojave by December. For once, his prediction does not appear to be based on unrealistic hopes, the need to reassure customers about delays, or a complete misunderstanding of what is happening on the ground here.

In other words, it’s actually plausible. Whether it will happen on that schedule…that’s another question. Flight test is notoriously unpredictable and very tough on timetables.

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Spaceport America Economic Impact Claim Lacks Actual Data

Four big thumbs up from Richard Branson and then New Mexico Gov. Bill Richardson at the Spaceport America runway dedication in 2010. (Credit: Douglas Messier)

NewsChannel 9 in El Paso recently looked into officials’ claims that Spaceport America had a $20 million economic impact on New Mexico’s economy in fiscal year 2016 and found a lack of support data.

However, when asked for a copy of the economic impact study or documents supporting the claim, Spaceport America’s chief financial officer, Zach De Gregorio, told NewsChannel 9 he didn’t use any documents and sent NewsChannel 9 a PowerPoint presentation with five slides.

“It’s just the PowerPoint,” said De Gregorio.

When asked how he did an economic impact study without any documents, De Gregorio said, “I had a lot of conversations and I talked with local business owners, customers and with city officials. I talked with my teammates and I got a really good sense of what was the activity in FY16.”

….When asked about exaggerating their economic impact, [Spaceport America Executive Director Dan] Hicks said, “The chart was intended to show the economic value of the activities at Spaceport America compared the funding received from the NM General Fund. It was simply a comparison chart to convey value added. An Economic Impact Study was not needed to provide a qualitative assessment of our value per NM general fund spending. The focus of the discussion was for our CFO to explain the assumptions he used to compile the information in that impact chart.”

The PowerPoint presentation showed a $20 million return based on the $944,000 the state invested in the spaceport in FY 2016. NewsChannel 9 said the figures do not show millions in taxes paid during the same fiscal year by residents of Dona Ana and Sierra counties to pay off bonds used for spaceport construction.

NewsChannel 9 also reported problems in obtaining documentation from Spaceport America. The spaceport attempted to charge the channel for documents that should be free to inspect under New Mexico law.

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Spaceport America Tax: The Levy that Keeps on Taking

The Virgin Galactic Gateway to Space building with a security fence around it. (Credit: Alex Heard)

Residents of New Mexico’s Dona Ana and Sierra counties will continue to subsidize Spaceport America’s operating budget for at least another year.

The New Mexico Finance Authority agreed to let the spaceport for one year use extra money from the taxes that shoppers pay in two Southern New Mexico counties. But the spaceport wanted the excess tax money in perpetuity, a proposal that the finance authority declined to grant as its chairman raised questions about the facility’s financial strength.

Though some politicians have supported the spaceport’s proposal, others have argued the tax money was only intended to help build the facility, not cover its day-to-day expenses.

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Investigative Journalism Report Coming on Spaceport America

Virgin Galactic President George Whitesides, NASA Deputy Administrator Lori Garver, Richard Branson, and New Mexico Gov. Bill Richardson at the dedication of Spaceport America’s runway in October 2010. (Credit: Douglas Messier)

Well, this ought to be interesting…

What NMPolitics.net is working on

By Heath Haussamen, NMPolitics.net
June 19, 2017

I’ve been working for months on an investigative project into the status of Spaceport America. The question of whether the spaceport is providing an economic benefit to the state is front-and-center, but I’m also exploring transparency and other issues. I’ve visited the spaceport, interviewed Virgin Galactic employees, dug deep into documents and researched what’s happening in other states that have spaceports. I’ve obtained information the public has never seen and am excited to publish this series. Look for it sometime in July.

NmPolitics.net

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New Mexico’s Spending on Spaceport America Likely Not Over

Sunset at the “Virgin Galactic Gateway to Space” terminal hangar facility at Spaceport America. (Credit: Bill Gutman/Spaceport America)

After a decade of broken promises and delays, the next year could bring some very good news for New Mexico’s $225 million taxpayer-funded Spaceport America.

Anchor tenant Virgin Galactic’s lease payments are increasing. And Richard Branson’s prediction for the start of commercial spaceflights there in 2018 appear (for once) to be on the mark, barring major problems with SpaceShipTwo’s flight test program.

So, it would seem that at long last, New Mexico’s hard-pressed taxpayers will finally be off the hook for supporting the spaceport. Right?…I mean, right?

Not necessarily.

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