Billionaire Richard Branson’s flight aboard a Virgin Galactic spacecraft Sunday marks a publicity milestone for New Mexico’s Spaceport America two weeks after a successful debt refunding.

“Fifteen years ago, New Mexico embarked on a journey to create the world’s first commercial spaceport,’’ Branson said Sunday. “Today, we launched the first human spaceflight from that very same place, marking an important milestone for both Virgin Galactic and New Mexico.”

In building the nation’s first commercial spaceport, New Mexico bet on a space tourism market that promoters thought could be worth $8 billion by 2030. But economic and technology missteps have accompanied development.

Politics have also played a part for the spaceport launched by then-Gov. Bill Richardson, a Democrat. Under his successor, Republican Susana Martinez, operating funds were cut.

Martinez’s successor, Democrat Michelle Lujan-Grisham, marked the day with triumphal rhetoric.

“After so many years and so much hard work, New Mexico has finally reached the stars,” Lujan-Grisham said. “We are on the cutting edge, the forefront of innovation, and I plan to do everything in my power to keep us there, taking full advantage of our robust economic and scientific potential.”

Sunday’s launch came a decade after Branson and New Mexico officials dedicated the $209 million facility and nearly seven years after the fatal test-flight crash of Virgin Galactic’s SpaceShipTwo.

Scott McLaughlin, recently named executive director at Spaceport America, told The Bond Buyer via email after the flight that the progress has continued through acquisition of less publicized customers.

“Spaceport America has been increasing in activity over the last few years, with four on-site tenants and many short-term customers,” McLaughlin said. “The successful flight today by Virgin Galactic is an immensely significant milestone in their efforts and validation of the spaceport’s original vision.”

The New Mexico Spaceport’s head start and Branson’s decision to leapfrog Amazon founder Jeff Bezos’ scheduled ride on his company Blue Origin’s spacecraft July 20 give the Land of Enchantment plenty of bragging rights.

The New Mexico Spaceport is near Las Cruces, 42 miles northwest of El Paso, Texas.

Virgin Galactic billed Sunday’s launch as the SS Unity’s “first test flight with a full crew in the cabin,” including 70-year-old founder Branson to test “the private astronaut experience.”

The rocket was lifted into the atmosphere with a carrier aircraft, before separating, igniting its rockets and flying to more than 50 miles above the Earth’s surface, allowing the crew to experience the weightlessness of space before the ship returned to land at the spaceport.

“New Mexico’s Spaceport America has always had significant competitive advantages including great weather, almost a mile high in altitude, a remote unpopulated location, restricted airspace, and an aerospace-ready workforce,” McLaughlin said.

“We are the only FAA-licensed spaceport with vertical and horizontal launch facilities,” he said.

“While the path to this flight was longer and more difficult than was originally envisioned, it confirms the hard work by many hundreds of people to put New Mexico at the forefront of the commercial space market.”

Bezos plans to ride the Blue Origin capsule to sub-orbital space from his privately owned ranch and launch site near Van Horn, Texas, 120 miles southeast of El Paso.

Bezos will be accompanied by his younger brother Mark and an 82-year-old former aviator named Wally Funk, who entered the U.S. astronaut training program in 1961 but never made it into space because women were excluded from launches.

Mark Bezos won a bidding contest for a seat in the spacecraft with a $28 million offer.

While Bezos has relied on his own financing for the Texas launch site, Branson persuaded New Mexico to take a stake in the project near the National Aeronautics and Space Administration’s White Sands Test Facility.

The New Mexico Finance Authority issued $55 million of severance-tax bonds as series 2009C to finance the spaceport and provided another $25 million of loans to the facility. The bonds were rated AA-plus by Standard & Poor’s with a stable outlook.

McLaughlin said the spaceport saved $8.2 million in a June 25 refunding of its original bonds.

The $35.4 million refunding reduced a 4.5% annual interest rate to less than 0.8%. That equates to $8.2 million over the nine years it will take to pay off the bonds, the agency said.

“This was a long and somewhat complicated process, involving many people at the Spaceport Authority, the New Mexico Finance Authority, the Board of Finance and the Spaceport America Regional Spaceport District,” McLaughlin said.

Doña Ana and Sierra counties shared the cost of the state-owned spaceport building, with Doña Ana County, which includes Las Cruces, county supporting 95% of the debt and Sierra County on the hook for 5%. The split reflects the counties’ populations.

From 2010 to 2021, Doña Ana County taxpayers paid $90.25 million toward construction costs for Spaceport America.

Under state law, both counties must provide at least 75% of what the county collects through gross revenue taxes for capital improvement projects at the site. The other 25% of the revenue collected goes to science and technology programs in public schools.

Voters in the two counties narrowly approved the local taxes to support spaceport bonds in 2007 and 2008.

Controversy ensued when the spaceport used excess revenue from the local taxes to help bolster its operating budget.

A state audit released in November described Spaceport America’s former director Dan Hicks as an incompetent and bullying boss who intercepted staff email, manipulated procurement rules and backdated authorization requests for travel using taxpayer funds.

The report by State Auditor Brian Colon led to Hicks’ firing in October and said that Hicks may have violated criminal and administrative statutes.

“It is critical that management at all levels of government support ethical behavior,” Colon said in a press release. “Setting an honorable tone at the top by establishing and following internal controls is essential.”

Matt Baca, chief counsel at the New Mexico Attorney General’s office, issued an informal opinion in a letter to Economic Development Secretary Alicia Keyes, who also chairs the Spaceport Authority.

Baca said that use of tax revenue for operations was improper, a finding that supported arguments by officials in Doña Ana and Sierra Counties.

Virgin Galactic had hoped to carry paying passengers from the spaceport in 2015, but the Oct. 31, 2014 crash of prototype SpaceShipTwo on a test flight over California’s Mojave Desert brought delays. The crash killed co-pilot Michael Alsbury and injured pilot Peter Siebold.

Articles You May Like

Texas ban on public university DEI offices carries financial penalty
Thames Water’s biggest shareholder writes off investment
U.S. Senate committee grapples with challenges facing rural hospitals
‘Quiet wealth’ takes on new meaning with super-private deals for mansions, art and classic cars
ETF demand solid amid growing retail interest