Spaceport pact reached

Posted: Monday, March 26, 2007 9:23 PM by Alan Boyle

New Mexico officials today revealed the details of a pact with the Virgin Galactic suborbital space venture as they geared up for a crucial spaceport tax vote next month. The memorandum of agreement calls for Virgin Galactic to pay about $27.5 million over 20 years to lease facilities at Spaceport America in southern New Mexico.

"Today was one of the big milestones for developing the spaceport," Rick Homans, chairman of the New Mexico Spaceport Authority and cabinet secretary of the New Mexico Economic Development Department, told me after today's signing in Las Cruces.

The spaceport is 45 miles northeast of Las Cruces and notched its first launch last September.

Virgin Galactic, which is part of British billionaire Richard Branson's business group, intends to make New Mexico its global headquarters and start offering suborbital space trips from Spaceport America in late 2009 or 2010. However, the state has said it will take $198 million to build the facilities needed by Virgin and other space operators.

State lawmakers said they would kick in $100 million toward that capital outlay - on three conditions: The cost estimate for building the spaceport had to come in at $225 million or less; the state had to reach a lease agreement with an anchor tenant; and a license had to be awarded by the Federal Aviation Administration. That last condition is still up in the air, but New Mexico hopes the FAA's OK will come through by the end of this year.

In addition to the $100 million in state funds, another $25 million or so is expected to come from the federal government. Local tax levies would fill the remaining gap. The first vote on local-option taxes is due to take place April 3 in Dona Ana County - and the outcome of that election could well determine whether the spaceport plan rises or falls.

"I know it's a very important vote, and there's a lot at stake," Homans told me. "I think that it will probably be a very close vote. From the beginning of this project, we've had a lot of hurdles, and we've approached each one with a high degree of optimism - and there's no reason to change our strategy now."

Today's agreement could provide some extra assurance to voters that Virgin Galactic's space venture isn't just pie in the sky, although some might still wonder why millions of tax dollars are being spent to build facilities for a billionaire. (Incidentally, the same question might be asked about sports stadiums.) To address that concern, the Economic Development Department points out that Virgin Galactic is spending more than $200 million to develop its SpaceShipTwo system, plus the $27.5 million in lease payments and other fees yet to be determined.

Will Whitehorn, president of Virgin Galactic, was quoted as saying today's agreement "represents a significant commitment by Virgin Galactic to be the anchor tenant at Spaceport America, and to help New Mexico grow a thriving new industry around commercial space companies."

Among the other space companies setting up shop in New Mexico are Starchaser Industries, UP Aerospace, the Rocket Racing League and the X Prize Cup.

Here are the key points of today's memorandum of agreement, which sets the conditions for the formal facilities lease:

Virgin Galactic will locate its primary launch and operational activities at Spaceport America and its global headquarters in New Mexico.
Virgin Galactic will lease about 83,400 square feet of space, including office space; customer service facilities; medical facilities and sleeping quarters for space fliers; hangars for maintenance and storage of aircraft; a mission control center; and a staff clubhouse.
The spaceport authority will provide common facilities including runways and a control tower, multipurpose training facilities, emergency facilities, fuel storage and delivery systems, restaurants and concessions, and visitor viewing areas. Virgin Galactic and other tenants will pay user fees, yet to be determined, to use these facilities.
Virgin Galactic's lease payments would be $1 million a year for the first five years of occupancy, then $1.5 million a year for the following 15 years. Virgin Galactic can extend the facilities lease for up to 10 years.
The spaceport authority will establish an advisory committee, consisting of Virgin Galactic and other tenants, to advise and work with the authority on operations, budget, capital improvements, maintenance, marketing and branding.
Virgin Galactic will get "preferred status" for the use of the airfield, launch facilities and airspace for certain periods of time.

Homans said the agreement would serve as a model for other spaceport tenants.

"It lays the foundation for some significant precedents at the spaceport, related to ground rent, user fees and development of a spaceport-tenant advisory committee to participate in decision-making," he told me. "All of these issues lay the groundwork for the operation of the spaceport."

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Comments

Hi, Alan -- To have a spaceport on the edge of town should make the stf addict believe all his dreams have come true. But...

Everything will be bright and shiny at first, then it will get a bit older and more decrepit, and the operators will find it more and more difficult to actually spend money on 'appearances' and then on 'infrastructure' and finally on 'rocketships' themselves.

I can only hope I'm wrong, wrong, wrong.

Des Emery,The Carborundum Chronicles,St.Thomas,ON,Canada (Sent Monday, March 26, 2007 10:29 PM)

Is it just me or is this one of the only things happening these days that gets you truly excited. It seems like something is really starting here, the beginning of something new and important.

If we thought that JFK's challenge accelerated space exploration just wait until the private sector get started and competition kicks in, then we'll truly see some innovation.
Richard Branson is a visionary.

Warren Burch, Redmond, Wash (Sent Tuesday, March 27, 2007 1:05 AM)

Granted, the next step toward space has to start somewhere, but somehow this just seems like a millionares model rocket club to me. "Oh look, Dick built one big enough to stick people in!". To call this a "spaceport" is humorous. Let's face it, at this point it would be an amusement park with one really cool ride, but that's about all. On top of that the price of the ride will exclude 98% of the population. Doesn't seem like a viable business model to me.

What if....instead of building a desert amusement park they used all that money to research and develop better rocket tech that could make space travel and habitation possible.

Andy, Michigan (Sent Tuesday, March 27, 2007 5:52 AM)

Being a resident I can say I don't want to be paying more in taxes to fund something that no one will use anyways. There are still people in the US, that think you need a passport to come here and that we can't drink the water. This venture would be better off in a destination that people actually already travel to. Let them raise taxes somewhere else.

MM, New Mexico (Sent Tuesday, March 27, 2007 11:27 AM)

I personally think that for the money being spent... they will be able to keep it looking nice.

The only problem comes in when this technology becomes common or outdated. Then their profits will drop.

Chuck, Alabama (Sent Tuesday, March 27, 2007 11:57 AM)

I think this is really cool. However, at this time with no support facilities in space to venture to, with the exception of the orbiting space station currently used by astronauts, I am not sure what the general public will be getting for their "fare" to ride this. Regardless, great idea - wish I had the money to go into space. Maybe if Richard reads this he'll call me and ask me to come for a vist and maybe a ride.

Michael Wilson, Tampa, Florida (Sent Tuesday, March 27, 2007 12:39 PM)

I live in florida, not too far from the cape, I believe NM is going to become one of the coolest places in the world, but it will never seem the same. With the increase in tourism, traffic, and sight-seer's there will not be such a thing as "a small town" welcome to the big leagues!

LAM (Sent Tuesday, March 27, 2007 12:41 PM)

If you build it, they will come. Sure, taxes may increase for a while to help build the Spaceport. But just think about it, the long term benefits to the entire state of New Mexico will be tremendous. New Mexico is the logical choice for the spaceport. With great weather year round, sparse population in the takeoff and landing areas, and room to expand, it's a win-win situation for everyone. Putting in the infrastructure now will enable companies to establish work platforms where they can experiment and design the vehicles that will not only take civilians to outer space but beyond. It's about time some far-sighted people started making things happen and we need to jump onboard and enjoy the ride.

Wayne, Alamogordo, NM (Sent Tuesday, March 27, 2007 1:37 PM)

Local taxes to fill the gap? The three counties that will raise their gross reciepts tax are some of the poorest counties in the country! These people will subsidize $200,000 joy rides for the rich. Spaceflight is also inherently risky, those that assume this is just another "airline flight" do not understand the most basic risks. What happens when the first crashes (and yes, it would be silly to assume no crashes)?

Robert Johnson, Alamogordo, NM (Sent Tuesday, March 27, 2007 1:41 PM)

let's look at the big picture like Warren Burch did. At what point do people realize it has to start somewhere. are we going to wait on NASA that gets 3% of the yearly budget or do we allow these private billionaires who have the free time and money to employ some of the brightest individuals available. it can be debated for years, but which would you prefer. go to work, come home, brag to your friends and family about the expensive crap you buy, force class and materialism down your children's throats until they don't have a chance to be free thinkers and then die leaving some personal sense of selfworth on a rock above your grave? or do we collectively as a planet realize that while the answer probably isn't 3 feet under mars' surface, the thought of long term and long distance space exploration could provide the purpose in life that so many people never find. sure we could explore the bottom of the ocean and find a new fish. we can dig underground and find a new rock. we can walk up to a volcano and say "man that's hot." we can look through telescopes sitting comfortably on our roof going "wow, i wonder whats out there" or we can get off our butts and do it. to see people trying to expand our knowledge of space and the possibilities of life elsewhere (which i don't doubt in the least there is) puts a smile on the face of people who look at this ridiculously greedy and excessive culture we've created. build one way rockets and put willing candidates to just be sent out as far as possible and they can transmit messages back to us. Do something. stop working your entire life so you can drive a Jaguar and tell your country club buddies how many square feet the back patio area is going to be.

Hunter Evans, Jacksonville Fl (Sent Tuesday, March 27, 2007 1:52 PM)

The concerns are valid but I believe so are the tangible results. Right now flying into space on 'an amusement park ride' will be elitist for a while but when things do become commonplace that is also when the price drops which opens the market to even more people. Think back to when the first CD players cost in excess of $500 or more. Now you get one for $50.00 or less and everyone has one. I believe the commercial space industry will be the same way, once results are proven real, people will flock to it.

Shawn, Indianapolis, IN (Sent Tuesday, March 27, 2007 2:43 PM)

Pessimistic thought Cape Canaveral was a big joke and NASA too. Think of the benefits of this venture in the long term.

Bill - Iowa (Sent Tuesday, March 27, 2007 2:44 PM)

This is an exciting and important step to the commercialization of space. Moving outwards and exploring space is the only way to insure the future of humanity, and I think only private industry can get us there. Let’s face it no government run program will ever lead to viable space travel or habitation. Just look other government run transportation, Amtrak. As always, there will be nay sayers with any new technology. The telephone, electric lights, and car are good of examples of people doubting new things. Now they are a part of everyday life. Also, with any new technology, only the rich will be able to afford it. Again, telephones, electric lights, and cars are good examples. However, as demand grows, prices drop. One day space travel will be common place and we can laugh at the nay sayers as we always have.

Joe, Texas (Sent Tuesday, March 27, 2007 3:19 PM)

Andy from Michigan, commercial flight was once a luxury reserved for the wealthy. Economies of scale helped make it feasable for everybody.

JC, Riverton, CT (Sent Tuesday, March 27, 2007 3:32 PM)

I have lived in New Mexico all of my life and frankly I'm tired of people like MM. When something new comes along that could vastly add to the quality of life/economy/infrastructer etc., there is always a huge resistance to it. The economy of the state could use some diversification and this will only help. It will bring lots of high paying jobs and potentially lots of tourists. I am all for it.

Abel, Las Cruces, New Mexico (Sent Tuesday, March 27, 2007 6:10 PM)

Ummm, a spaceport in New Mexico? Isn't New Mexico at a more northern latitude than Cape Canaveral? Doesn't that make it harder to launch rockets? Or is there a boost technology I'm not aware of that negates the need for solid rocket booster technology? If NASA is having a hard time funding such things, how long will a stingy billoinaire and his investors last? Don't get me wrong. I enjoy science fiction, stargazing and futuristic thinking like the next person. But I am not sure I buy into this whole spaceport luxury spaceflight tourism thingy. Tooooooo many questions. Not enough answers.

BigDaddyMo, somewhere in Iowa (Sent Tuesday, March 27, 2007 6:18 PM)

Though an idea such as this is usually met with initial skepticism, ultimately it is this idea that will serve to advance human knowledge. Air travel was too expensive and dangerous in its early years, wasn't it? Rise!

Mat Johnsonbaugh, San Diego, CA (Sent Tuesday, March 27, 2007 8:16 PM)

It's one of those crazy things that might just work. But it is a " build it and they will" come sort of thing and built more on faith than practicality. Moreover, do a little market research and you will find the low cost competitors like Russia and China spoiling the picture. Will outsourcing spoil the space dreams too?

Ron Piette, San Jose, CA (Sent Wednesday, March 28, 2007 2:02 AM)

Robert Johnson - It would be worthwhile to look at the business plans and markets before commenting on the situation. First, it won't just be sub-orbital enjoyment rides - short term, there are a total of at least 7 revenue streams. Second, the price of $200,000 will almost certainly come down rather fast. John Carmack, one of the owners of a company that plans to use the spaceport, recently talked about how low he thinks he can get it - read about it at

http://www.hobbyspace.com/
nucleus/index.php?itemid=3532

As for the crashes, well, it depends a lot on the hows, and the wheres, and the whys - a crash sooner would hurt the industry more than a crash later. A crash thats caused because of an act of god will do less damage than one caused by neglegence. But I don't believe it will be crippling - this is the industry, not of space tourism, but of space colonization.

BigDaddyMo - actually, for sub-orbitals, the latitudes and rotation don't actually play a role at all. Orbital is a different game, but that doesn't mean you have to limit yourself to the tropical latitudes - in fact there are reasons why you might not want to.

As far as funding, well, the answer is the billionares have lasted quite long - look at Elon Musk, or Robert Bigelow, or John Carmack, or Jim Benson, or Paul Allen, or Jeff Bezos - they've all been at it for quite a long time (and it looks like Branson will join them).

The answers are all there - you just have to look for them

Aaron Oesterle, Ann Arbor Mi (Sent Wednesday, March 28, 2007 2:46 AM)

Good luck Mr. Branson, and watch out for cylons.

Adept Havelock KCMO (Sent Wednesday, March 28, 2007 8:18 AM)

To BigDaddy: Launch latitude only matters if you're going into orbit, and want to get the most advantage of Earth's spin, and easier maneuvering if your payload's meant for geostationary orbit. If you're only going up 63 miles or more, and returning to your launch site, technically, anyplace will do. No advantage is gained by being on a seacoast either, as we only do it now, as a place to drop spent rocket stages downrange, again, on the way to orbit.

However, as the view is part of the motivation for suborbital tourism, the visual impact of the surface below, will mean something. You likely won't launch from a fairly remote island (like Kawajelin, which SpaceX uses, because they could do low-inclination *or* polar launches from there, something that's not true of most other places), as there'd be nothing but the sea below, even from 100km.

Never having been to New Mexico, however, I don't have a sense of how interesting it might look from far above. (Hmm. I guess that's where Google Earth comes in...)

Frank Glover (Sent Thursday, March 29, 2007 5:59 PM)

Great. Taxing the poor so billionaires can have a thrill ride and brag about being in space.

And after the taxes are collected and facilities built, and the rides commence, they will find that the number of those willing to spend big bucks for a thrill ride is much smaller than they expected, the whole thing folds up, and the poor people left will still be stuck with higher taxes.

I sincerely hope the people there come to their senses and vote this boondoggle down.

CM (Sent Friday, March 30, 2007 2:44 AM)

If southern New Mexico votes this down, they are fools.

There are plenty of states with the foresight to build a commercial spaceport. Plenty with the vision to see that many companies will use the spaceport, not only Virgin Galactic, and not only for tourism.

We're talking about a state that has fallen in love with being poor. New Mexico LOVES being in the bottom five of every list, from income to education. Try to change that, and you are the "evil rich."

All of my smart friends have already fled this benighted state to find real jobs, and I believe I'll join them if we lose the spaceport.

There is no vision in New Mexico. None.

Jason Merrell, Albuquerque, New Mexico (Sent Friday, March 30, 2007 10:41 PM)

All dressed up and no where to go. All kidding aside, there are just not that many billionaire adventurers willing to pay big bucks to make this a successful business. What you are going to have is a multi-billion dollar white elephant, like Metro-rail in Miami. You will have a program with astronomical overhead, and little revenue. These joy rides will be a monumental waste of precious energy and natural resources. They will produce an enormous amount of pollution. They will not advance space travel one bit. They will not engage in anything cutting edge. It sounds to me like an unrealistic pie in the sky fantasy. Beam me up Scotty, there is no intelligent life on down here. Branson is not a billionaire. He is bankrupt. And this is probably a scam to make money off gulliable investors who because they think the idea is neat, fail to do the math.

Pete Moss, Miami, Florida (Sent Monday, April 16, 2007 10:05 PM)

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