{"id":409015,"date":"2017-08-21T06:58:44","date_gmt":"2017-08-21T12:58:44","guid":{"rendered":"http:\/\/nmpolitics.net\/index\/?p=409015"},"modified":"2017-08-25T07:11:36","modified_gmt":"2017-08-25T13:11:36","slug":"is-spaceport-america-taking-flight","status":"publish","type":"post","link":"https:\/\/nmpolitics.net\/index\/2017\/08\/is-spaceport-america-taking-flight\/","title":{"rendered":"Is Spaceport America taking flight?"},"content":{"rendered":"\n\t\t\t<div id=\"slides-409015-da49b9a2064710e9b88ac88ab6b1b2c2\" class=\"navis-slideshow\"><div id=\"409015-da49b9a2064710e9b88ac88ab6b1b2c2-slide1\"><img data-lazy=\"https:\/\/nmpolitics.net\/index\/wp-content\/uploads\/2017\/08\/SpaceportAmericaCup4.jpg\" \/><h6 class=\"credit\">Spaceport America photo<\/h6><h6 class=\"permalink\"><a href=\"https:\/\/nmpolitics.net\/index\/2017\/08\/is-spaceport-america-taking-flight\/#409015-da49b9a2064710e9b88ac88ab6b1b2c2\/1\" class=\"slide-permalink\"><i class=\"icon-link\"><\/i> permalink<\/a><\/h6><p class=\"wp-caption-text\">College students pose for a photo in front of a replica of Virgin Galactic's SpaceShipTwo in the company's hangar at Spaceport America during the Spaceport America Cup in June.<\/p><\/div><div id=\"409015-da49b9a2064710e9b88ac88ab6b1b2c2-slide2\"><img data-lazy=\"https:\/\/nmpolitics.net\/index\/wp-content\/uploads\/2017\/08\/SpaceportAmericaCup5.jpg\" \/><h6 class=\"credit\">Spaceport America photo<\/h6><h6 class=\"permalink\"><a href=\"https:\/\/nmpolitics.net\/index\/2017\/08\/is-spaceport-america-taking-flight\/#409015-da49b9a2064710e9b88ac88ab6b1b2c2\/2\" class=\"slide-permalink\"><i class=\"icon-link\"><\/i> permalink<\/a><\/h6><p class=\"wp-caption-text\">A rocket built by college students launches during the Spaceport America Cup in June.<\/p><\/div><div id=\"409015-da49b9a2064710e9b88ac88ab6b1b2c2-slide3\"><img data-lazy=\"https:\/\/nmpolitics.net\/index\/wp-content\/uploads\/2017\/08\/SpaceportAmericaCup1.jpg\" \/><h6 class=\"credit\">Spaceport America photo<\/h6><h6 class=\"permalink\"><a href=\"https:\/\/nmpolitics.net\/index\/2017\/08\/is-spaceport-america-taking-flight\/#409015-da49b9a2064710e9b88ac88ab6b1b2c2\/3\" class=\"slide-permalink\"><i class=\"icon-link\"><\/i> permalink<\/a><\/h6><p class=\"wp-caption-text\">Students from California Polytechnic State University were among those who competed in the Spaceport America Cup in June.<\/p><\/div><div id=\"409015-da49b9a2064710e9b88ac88ab6b1b2c2-slide4\"><img data-lazy=\"https:\/\/nmpolitics.net\/index\/wp-content\/uploads\/2017\/08\/SpaceportAmericaCup3.jpg\" \/><h6 class=\"credit\">Spaceport America photo<\/h6><h6 class=\"permalink\"><a href=\"https:\/\/nmpolitics.net\/index\/2017\/08\/is-spaceport-america-taking-flight\/#409015-da49b9a2064710e9b88ac88ab6b1b2c2\/4\" class=\"slide-permalink\"><i class=\"icon-link\"><\/i> permalink<\/a><\/h6><p class=\"wp-caption-text\">College students pose with their rockets in front of Virgin Galactic's hangar at Spaceport America during the Spaceport America Cup in June.<\/p><\/div><div id=\"409015-da49b9a2064710e9b88ac88ab6b1b2c2-slide5\"><img data-lazy=\"https:\/\/nmpolitics.net\/index\/wp-content\/uploads\/2017\/08\/SpaceportAmericaCup2.jpg\" \/><h6 class=\"credit\">Spaceport America photo<\/h6><h6 class=\"permalink\"><a href=\"https:\/\/nmpolitics.net\/index\/2017\/08\/is-spaceport-america-taking-flight\/#409015-da49b9a2064710e9b88ac88ab6b1b2c2\/5\" class=\"slide-permalink\"><i class=\"icon-link\"><\/i> permalink<\/a><\/h6><p class=\"wp-caption-text\">The Spaceport America Cup in June included an event at the Las Cruces Convention Center.<\/p><\/div><\/div>\n<h4><em>An NMPolitics.net investigation finds challenges, but also reason for optimism<\/em><\/h4>\n<p>The <a href=\"http:\/\/www.lcsun-news.com\/story\/news\/local\/spaceport\/2017\/06\/20\/spaceport-america-cup-draws-future-industry-leaders-las-cruces\/414074001\/\" target=\"_blank\" rel=\"noopener noreferrer\">Spaceport America Cup<\/a> \u2013 a rocket-launching competition that brought more than 1,100 college students to southern New Mexico in June \u2013 was \u201ceasily the largest city-wide event in the last 10 years\u201d in Las Cruces, a hotel company says.<\/p>\n<p>The event helped Hotel Encanto and Hilton Garden Inn keep workers employed in a historically slow tourism month, the company says.<\/p>\n<p>The students launched their rockets from Spaceport America, located east of Truth or Consequences, and there was some increased tourism in that city too. Ticket sales were up at El Cortez movie theater during the rocket competition, according to Moshe Koenick, who runs the theater in T or C. So was business at Koenick\u2019s store, Dust &amp; Glitter.<\/p>\n<p>And though two fatal accidents have delayed Virgin Galactic\u2019s planned flights of paying customers into space from southern New Mexico for years, the company currently has 21 employees in Las Cruces. Virgin Galactic says it\u2019s moving another 85-90 here from Mojave, California when testing of its space vehicle is complete, which could happen in the coming months.<\/p>\n<aside class=\"module align-left half type-aside\">\n<h3>About this series<\/h3>\n<p>This article is part of <a href=\"http:\/\/nmpolitics.net\/index\/series\/spaceport-america\/\" target=\"_blank\" rel=\"noopener noreferrer\">an NMPolitics.net series<\/a> examining Spaceport America\u2019s impact on New Mexico\u2019s economy and future. A decade ago, the state and voters in Do\u00f1a Ana and Sierra counties approved public funding to build the facility on the promise of Virgin Galactic flying paying customers into space from southern New Mexico and elected officials pledging thousands of new jobs in the tech and tourism sectors. We spent months investigating where things stand today.<\/p>\n<h3>Read the rest of the series<\/h3>\n<ul>\n<li><a href=\"http:\/\/nmpolitics.net\/index\/2017\/08\/funding-woes-could-cripple-nm-spaceport-as-other-states-invest-in-space-race\/\" target=\"_blank\" rel=\"noopener noreferrer\">Funding woes could \u2018cripple\u2019 NM spaceport as other states invest in space race<\/a><\/li>\n<li><a href=\"http:\/\/nmpolitics.net\/index\/2017\/08\/transparency-problems-plague-spaceport-america\/\" target=\"_blank\" rel=\"noopener noreferrer\">Transparency problems plague Spaceport America<\/a><\/li>\n<li><a href=\"http:\/\/nmpolitics.net\/index\/2017\/08\/how-much-secrecy-does-spaceport-america-need\/\" target=\"_blank\" rel=\"noopener noreferrer\">How much secrecy does Spaceport America need?<\/a><\/li>\n<li><a href=\"http:\/\/nmpolitics.net\/index\/2017\/08\/after-years-of-delays-virgin-galactic-prepares-for-spaceflights-from-nm\/\" target=\"_blank\" rel=\"noopener noreferrer\">After years of delays, Virgin Galactic prepares for spaceflights from NM<\/a><\/li>\n<\/ul>\n<\/aside>\n<p>New Mexico\u2019s investment in Spaceport America is a long way from spurring creation of the 5,000 new jobs then-Gov. Bill Richardson <a href=\"http:\/\/nmpolitics.net\/index\/2007\/01\/richardson-promotes-spaceport-tax-increase\/\" target=\"_blank\" rel=\"noopener noreferrer\">promised<\/a> state lawmakers and voters in Do\u00f1a Ana and Sierra counties a decade ago when they agreed to provide about $220 million to fund the project.<\/p>\n<p>At the time, officials envisioned a new commercial space economy that would transform southern New Mexico and help the state become less dependent on the oil and gas industry. Virgin Galactic, founded by British billionaire Sir Richard Branson, would make its home here. The state would attract other space companies. Funding for space-related K-12 education programs would create a pipeline to help New Mexico\u2019s kids snag the new jobs and be able to stay in New Mexico, if they chose.<\/p>\n<p>The state took a risk back then, constructing the first facility anywhere that was designed and built for commercial spaceflight. But Virgin Galactic\u2019s struggles to complete <a href=\"https:\/\/en.wikipedia.org\/wiki\/SpaceShipTwo\" target=\"_blank\" rel=\"noopener noreferrer\">SpaceShipTwo<\/a> have delayed the level of activity officials anticipated. The commercial space industry is highly competitive, and <a href=\"http:\/\/www.spaceflorida.gov\/docs\/spaceport-ops\/florida-spaceport-systems-plan-2013_final.pdf?sfvrsn=2\" target=\"_blank\" rel=\"noopener noreferrer\">Florida<\/a> and <a href=\"https:\/\/www.space.com\/22828-nasa-virginia-spaceport-private-spaceflight.html\" target=\"_blank\" rel=\"noopener noreferrer\">Virginia<\/a> are among the states now building successful partnerships with other space companies. Skepticism among some public officials in New Mexico has also slowed Spaceport America\u2019s progress.<\/p>\n<p>Though today\u2019s reality is far short of the vision laid out years ago, a months-long NMPolitics.net investigation found reason for optimism. The spaceport is spurring tourism and has created some jobs in southern New Mexico. Experts suspect the spaceport\u2019s impact on the economy may already be greater than it estimates. Many officials are optimistic about the spaceport\u2019s new CEO, Dan Hicks, who took the reins <a href=\"http:\/\/www.lcsun-news.com\/story\/news\/local\/spaceport\/2016\/09\/22\/spaceport-board-names-new-ceo\/90844390\/\" target=\"_blank\" rel=\"noopener noreferrer\">in September<\/a> after a 34-year career at White Sands Missile Range.<\/p>\n<p>And if Virgin Galactic begins flights in 2018, as Branson <a href=\"https:\/\/www.bloomberg.com\/news\/articles\/2017-07-05\/branson-targets-space-by-mid-2018-as-virgin-begins-powered-tests\" target=\"_blank\" rel=\"noopener noreferrer\">recently suggested<\/a>, southern New Mexico\u2019s commercial space economy could take flight.<\/p>\n<p>The spaceport\u2019s team \u201chas the right skill set, vision and motivation\u201d to lead in today\u2019s commercial space industry, said Lt. Gov. John Sanchez, a non-voting member of the spaceport\u2019s governing board and chair of the national Aerospace States Association.<\/p>\n<p>Spaceport America, the Republican predicted, \u201cwill become a key port for our nation\u2019s access to space\u201d and a \u201ctransportation hub\u201d for cargo and passengers traveling to points around the planet.<\/p>\n<p>But Spaceport America has some challenges to overcome. For starters, New Mexico needs a professional study to give officials and the public a better sense of the economic activity it\u2019s generating.<\/p>\n\n\t\t\t<div id=\"slides-409015-4973c4d1eda6e3c0e10743e4fc583194\" class=\"navis-slideshow\"><div id=\"409015-4973c4d1eda6e3c0e10743e4fc583194-slide1\"><img data-lazy=\"https:\/\/nmpolitics.net\/index\/wp-content\/uploads\/2017\/08\/4.19.17-De-Gregorio-Zach.jpg\" \/><h6 class=\"credit\">Heath Haussamen \/ NMPolitics.net<\/h6><h6 class=\"permalink\"><a href=\"https:\/\/nmpolitics.net\/index\/2017\/08\/is-spaceport-america-taking-flight\/#409015-4973c4d1eda6e3c0e10743e4fc583194\/1\" class=\"slide-permalink\"><i class=\"icon-link\"><\/i> permalink<\/a><\/h6><p class=\"wp-caption-text\">Spaceport America Chief Financial Officer Zach De Gregorio discusses his analysis of the spaceport\u2019s impact on the area economy during a forum with economists and journalists at the spaceport in April. <\/p><\/div><div id=\"409015-4973c4d1eda6e3c0e10743e4fc583194-slide2\"><img data-lazy=\"https:\/\/nmpolitics.net\/index\/wp-content\/uploads\/2017\/08\/4.19.17-Ward-and-Peach.jpg\" \/><h6 class=\"credit\">Heath Haussamen \/ NMPolitics.net<\/h6><h6 class=\"permalink\"><a href=\"https:\/\/nmpolitics.net\/index\/2017\/08\/is-spaceport-america-taking-flight\/#409015-4973c4d1eda6e3c0e10743e4fc583194\/2\" class=\"slide-permalink\"><i class=\"icon-link\"><\/i> permalink<\/a><\/h6><p class=\"wp-caption-text\">Economic analyst Erin Ward, left, and New Mexico State University economist Jim Peach discuss the spaceport\u2019s impact during a forum at the facility west of Truth or Consequences in April. <\/p><\/div><\/div>\n<h3>An incomplete study<\/h3>\n<p>Virgin Galactic\u2019s <a href=\"https:\/\/www.space.com\/13294-spaceport-america-virgin-galactic-dedication.html\" target=\"_blank\" rel=\"noopener noreferrer\">hangar<\/a> at Spaceport America rises toward the sky in the remote desert, a 12,000-foot runway at its side and a separate office building nearby. A tall fence surrounds the state-owned spaceport to prevent deer and oryx from wandering onto the runway and keep out unauthorized people. Armed security guards keep watch. A firefighting crew\u00a0is on hand.<\/p>\n<p>Since last fall, Spaceport America officials have been showing\u00a0<a href=\"http:\/\/nmpolitics.net\/index\/wp-content\/uploads\/2017\/03\/Spaceport-America-Economic-Impact-09-21-2016.pdf\" target=\"_blank\" rel=\"noopener noreferrer\">a slideshow<\/a> that makes a claim as grand as the futuristic structure they built: that the state saw a 20-fold return on its investment in the spaceport in terms of economic impact in Fiscal Year 2016.<\/p>\n<p>The state contributed $944,000 to the spaceport\u2019s budget that year. The slideshow claimed the spaceport generated $20.8 million in economic activity. That proves, spaceport officials say, that the facility is fully functional and having a significant impact.<\/p>\n<p>But that analysis isn\u2019t a reliable measure of the spaceport\u2019s activity, some economists interviewed for this article said.<!--more--><\/p>\n<p>The primary issue is that the analysis counts public money invested in the project as economic impact alongside private spending. That includes $2.2 million that Do\u00f1a Ana and Sierra counties spent on science, technology, engineering and math (STEM) education programs that year from a tax increase that also helped fund spaceport construction. It appears to also include other public spending on the spaceport.<\/p>\n<p>\u201cThe spaceport economic impact study suffers from a classic mistake, which is to only count the benefits and not count the costs,\u201d said Chris Erickson, an economics professor at New Mexico State University. \u201cFor that reason, it can&#8217;t be taken seriously.\u201d<\/p>\n<p>That doesn\u2019t mean all is lost, or that spaceport officials are lying. Analyzing economic impact is complicated. In some cases, public money could be counted as a benefit, economists said. It\u2019s all about who your audience is \u2013 and in this case, spaceport officials who counted the local tax money as economic impact were <a href=\"https:\/\/www.nmlegis.gov\/minutes\/NMFAminsep20.16.pdf\" target=\"_blank\" rel=\"noopener noreferrer\">presenting to legislators<\/a> who provide separate, state funding for the spaceport.<\/p>\n<p>Regardless, the slideshow doesn\u2019t provide a clear picture to help the public consider whether its investment in the spaceport \u2013 through state funding and local tax increase \u2013 has attracted sufficient private investments.<\/p>\n<p>The slideshow is labeled\u00a0an \u201ceconomic impact\u201d study. But Jim Peach, also an NMSU economics professor, said the spaceport\u2019s study lacks information such a study should include.\u00a0\u201cThere\u2019s enough that they\u2019re not saying here that it\u2019s hard to evaluate the claims,\u201d Peach said.<\/p>\n<p>The analysis was done in-house by Zach De Gregorio, the spaceport\u2019s chief financial officer, who has master\u2019s degrees in accounting and finance. He said the slideshow is based on \u201canecdotal discussions\u201d with government officials and business owners that gave him \u201ca sense of the activity at Spaceport America.\u201d<\/p>\n<p>NMPolitics.net requested all documents that went into De Gregorio\u2019s analysis to try to investigate his claims. We wanted to review financial records, including payments from Virgin Galactic and other companies doing business there, that appeared to be included in De Gregorio\u2019s analysis.<\/p>\n<p>\u201cThere are no more documents,\u201d De Gregorio told NMPolitics.net. And Hicks said De Gregorio\u2019s notes were destroyed.<\/p>\n<p>Instead of providing the documents NMPolitics.net requested, Hicks invited NMPolitics.net to a forum at Spaceport America in April with spaceport and Virgin Galactic staff and three area economists, including Peach. The economists told spaceport officials that De Gregorio\u2019s analysis was not an economic impact study. They asked questions to better understand the spaceport\u2019s impact.<\/p>\n<p>And they came away impressed by what they heard.<\/p>\n<p>The spaceport wasn\u2019t measuring areas of impact it should be, the economists discovered. For example, Kevin Boberg, NMSU\u2019s vice president for economic development, said at the forum he didn\u2019t want to know only how many hotel rooms were booked for the Spaceport America Cup in June. He wanted to know how many nights people stayed and how much they spent each day.<\/p>\n<p>And while De Gregorio\u2019s analysis included the investment of tax money in STEM education, Boberg said the spaceport needs to measure how that money aids retention of grade-school students. \u201cI want to know outcome,\u201d Boberg said.<\/p>\n<p>Given what was missing from De Gregorio\u2019s analysis, Peach said the impact might be greater than the spaceport claims.<\/p>\n<p>\u201cI can conceive of this being an underestimate,\u201d Peach said during that forum.<\/p>\n<p>Also impressed was economic analyst Erin Ward, who conducted <a href=\"http:\/\/www.bliss.army.mil\/DPW\/Environmental\/documents\/SNMEP%20JLUS%20Economic%20Impact%20Study.pdf\" target=\"_blank\" rel=\"noopener noreferrer\">a study<\/a> for the U.S. Department of Defense on the impact of regional military installations in 2013. Her study included a quick analysis of the spaceport\u2019s impact, which she estimated that year at $19 million, from a combination of public and private spending.<\/p>\n<p>\u201cI\u2019m optimistic about the future,\u201d Ward said after the forum at Spaceport America.<\/p>\n<p>Hicks said he believes De Gregorio\u2019s analysis was conservative and he was heartened by the reactions of the economists.<\/p>\n<p>\u201cWe\u2019re here to create an economy,\u201d Hicks said. \u201cThat\u2019s what our mandate was and that\u2019s what I think we\u2019re here being very successful at doing.\u201d<\/p>\n<p>Some of the economists said Spaceport America needs a professional economic impact study, the type that the NMSU economists can do. And the spaceport needs to be careful and accurate in its communications with the Legislature, which holds its purse strings, Peach and Erickson said.<\/p>\n<p>Spaceport officials should \u201cnot try to do the things they don\u2019t have the expertise to do,\u201d Erickson said.<\/p>\n<p>\u201cEconomists don\u2019t build spaceships, and spaceports shouldn\u2019t do economic impact analyses,\u201d he said.<\/p>\n<p>Hicks told NMPolitics.net he\u2019s aware of the need for a professional economic impact study but the agency can\u2019t afford it. Such studies can cost tens of thousands of dollars. Hicks said he is instead hoping to partner with master\u2019s-level economics students at NMSU this fall to conduct a new analysis.<\/p>\n<p>Peach is sympathetic to the spaceport\u2019s budget situation. \u201cMr. Hicks is an honest and honorable man.\u00a0There was no attempt to exaggerate anything.\u00a0With limited resources, they did the best they could,\u201d he said.<\/p>\n<p>Boberg said he believes De Gregorio \u201creasonably responded\u201d to the Legislature\u2019s request for information with his analysis. And he said Spaceport America appears \u201cto be on course to begin realizing some of the aspirations folks had so many years ago.\u201d<\/p>\n<p>Still, without a full economic impact study, it\u2019s difficult to know with certainty.<\/p>\n\n\t\t\t<div id=\"slides-409015-2ee79ff044a5ae17bb8b3f5a9b1ab460\" class=\"navis-slideshow\"><div id=\"409015-2ee79ff044a5ae17bb8b3f5a9b1ab460-slide1\"><img data-lazy=\"https:\/\/nmpolitics.net\/index\/wp-content\/uploads\/2017\/08\/4.19.17-Spaceport-visitor-center.jpg\" \/><h6 class=\"credit\">Heath Haussamen \/ NMPolitics.net<\/h6><h6 class=\"permalink\"><a href=\"https:\/\/nmpolitics.net\/index\/2017\/08\/is-spaceport-america-taking-flight\/#409015-2ee79ff044a5ae17bb8b3f5a9b1ab460\/1\" class=\"slide-permalink\"><i class=\"icon-link\"><\/i> permalink<\/a><\/h6><p class=\"wp-caption-text\">Economic analyst Erin Ward, left, and New Mexico State University economist Jim Peach check out the visitor\u2019s center at Spaceport America during a tour of the facility in April. <\/p><\/div><div id=\"409015-2ee79ff044a5ae17bb8b3f5a9b1ab460-slide2\"><img data-lazy=\"https:\/\/nmpolitics.net\/index\/wp-content\/uploads\/2017\/08\/4.19.17-Ward-Erin.jpg\" \/><h6 class=\"credit\">Heath Haussamen \/ NMPolitics.net<\/h6><h6 class=\"permalink\"><a href=\"https:\/\/nmpolitics.net\/index\/2017\/08\/is-spaceport-america-taking-flight\/#409015-2ee79ff044a5ae17bb8b3f5a9b1ab460\/2\" class=\"slide-permalink\"><i class=\"icon-link\"><\/i> permalink<\/a><\/h6><p class=\"wp-caption-text\">Economic analyst Erin Ward looks down on Virgin Galactic\u2019s hangar and a replica of SpaceShipTwo, the vehicle the company plans to use to fly paying customers into space, during a tour of Spaceport America in April.<\/p><\/div><\/div>\n<h3>Economic activity<\/h3>\n<p>So what do we know about the economic activity Spaceport America is generating?<\/p>\n<p>Fifty-one people currently have government jobs with the Spaceport Authority \u2013 including Hicks and his staff in Las Cruces and the contract fire and security crews at the spaceport, Hicks said. Most are full-time positions. Those people spend money in the local economy.<\/p>\n<p>UP Aerospace continues launching research and other payloads from Spaceport America, which it has been doing <a href=\"https:\/\/www.abqjournal.com\/213138\/up-aerospace-nasa-rocket-launch-at-spaceport-america-successful-2.html\" target=\"_blank\" rel=\"noopener noreferrer\">since 2006<\/a>. Hicks said the company has launches scheduled for later this year.<\/p>\n<p>ARCA Space Corporation is developing a lower-cost rocket <a href=\"http:\/\/www.lcsun-news.com\/story\/money\/industries\/aerospace\/2017\/03\/29\/arca-unveils-haas-2ca-rocket-las-cruces\/99772172\/\" target=\"_blank\" rel=\"noopener noreferrer\">in Las Cruces<\/a> that would carry heavy payloads into space. It\u2019s also taking orders for a\u00a0hoverboard at a cost of $14,500. In February, the company said it had <a href=\"http:\/\/www.lcsun-news.com\/story\/money\/industries\/aerospace\/2017\/02\/12\/arca-poised-expand-las-cruces-operations\/97652538\/\" target=\"_blank\" rel=\"noopener noreferrer\">made $350,000<\/a> from hoverboard orders.<\/p>\n<p>In addition to Virgin Galactic and UP Aerospace, three other companies have leases at Spaceport America \u2013 SpaceX, EXOS Aerospace and EnergeticX. Spaceport officials don\u2019t say much about what those or other clients are doing. They redacted rent and fee information from most lease agreements provided to NMPolitics.net, which may violate state transparency law, but they released Virgin Galactic\u2019s without redactions. De Gregorio\u2019s analysis states that space companies other than Virgin Galactic spent $1.3 million in New Mexico in Fiscal Year 2016.<\/p>\n<p>His analysis also states that film and commercial shoots at the spaceport netted $1.1 million in direct spending.<\/p>\n<p>Then there\u2019s the biggie, Virgin Galactic. The company\u2019s direct spending was $3.3 million in Fiscal Year 2016, according to De Gregorio\u2019s analysis. That\u2019s expected to jump in 2018, when Virgin Galactic\u2019s rent increases from $1 million per year to about $3 million.<\/p>\n<p>Virgin Galactic had paid $7.1 million in rent and user fees to the state for its use of a hangar and other facilities at Spaceport America as of April 2017, according to Jonathan Firth, the company\u2019s executive vice president for spaceport and program development. Since 2010, Firth said, the company has spent another $9.4 million with New Mexico businesses on construction and other things.<\/p>\n<p>The company\u2019s current employees in Las Cruces include Pete Nickolenko, who left a NASA career in Florida after 24 years to become Virgin Galactic\u2019s director of spaceline engineering. As an example of how Virgin Galactic\u2019s employees are putting money into the area economy, Nickolenko bought a home in Las Cruces and his two children are attending New Mexico colleges.<\/p>\n\n\t\t\t<div id=\"slides-409015-5a9e6850f142d19f1d81b38fc8f2837a\" class=\"navis-slideshow\"><div id=\"409015-5a9e6850f142d19f1d81b38fc8f2837a-slide1\"><img data-lazy=\"https:\/\/nmpolitics.net\/index\/wp-content\/uploads\/2017\/08\/8.14.17-Encanto1.jpg\" \/><h6 class=\"credit\">Heath Haussamen \/ NMPolitics.net<\/h6><h6 class=\"permalink\"><a href=\"https:\/\/nmpolitics.net\/index\/2017\/08\/is-spaceport-america-taking-flight\/#409015-5a9e6850f142d19f1d81b38fc8f2837a\/1\" class=\"slide-permalink\"><i class=\"icon-link\"><\/i> permalink<\/a><\/h6><p class=\"wp-caption-text\">A view of the outdoor space Hotel Encanto de Las Cruces recently renovated to accommodate Virgin Galactic\u2019s high-dollar customers. The hotel is \u201cfully committed to providing a 5-star deluxe VIP service to the astronauts and others who travel to our area as part of the spaceport experience,\u201d Heritage Hotels founder and CEO Jim Long said.<\/p><\/div><div id=\"409015-5a9e6850f142d19f1d81b38fc8f2837a-slide2\"><img data-lazy=\"https:\/\/nmpolitics.net\/index\/wp-content\/uploads\/2017\/08\/6.23.17-T-or-C-Brewing-Co.jpg\" \/><h6 class=\"credit\">Heath Haussamen \/ NMPolitics.net<\/h6><h6 class=\"permalink\"><a href=\"https:\/\/nmpolitics.net\/index\/2017\/08\/is-spaceport-america-taking-flight\/#409015-5a9e6850f142d19f1d81b38fc8f2837a\/2\" class=\"slide-permalink\"><i class=\"icon-link\"><\/i> permalink<\/a><\/h6><p class=\"wp-caption-text\">Truth or Consequences Brewing Co. saw \u201csome spaceport traffic\u201d during the Spaceport America Cup in June, \u201cbut nothing major,\u201d owner Marianne Blaue said.<\/p><\/div><\/div>\n<h3>Tourism<\/h3>\n<p>Spaceport America has also had a tangible impact on tourism. A tour bus operator that contracted with the spaceport in Fiscal Year 2016 spent $1 million, De Gregorio\u2019s analysis states. When he estimated related spending, including meals and hotels, De Gregorio placed\u00a0the tourism impact that year at just under $1.8 million.<\/p>\n<p>This year there\u2019s likely more activity. Spaceport America hosted the college rocket competition for the first time this June and plans to continue doing so annually. More than 1,100 students traveled to southern New Mexico, some with family members and others, for the weekend. The convention center in Las Cruces filled up. The students launched rockets from Spaceport America.<\/p>\n<p>As a result, Heritage Hotels, which operates Hotel Encanto and Hilton Garden Inn in Las Cruces, saw a 25 percent increase in total revenue in June 2017 compared to June 2016, according to <a href=\"http:\/\/nmpolitics.net\/index\/wp-content\/uploads\/2017\/06\/Spaceport-America-Success-Belia-Alvarez.pdf\" target=\"_blank\" rel=\"noopener noreferrer\">a document<\/a> the company provided spaceport officials. In one of the hotel industry\u2019s slowest months, that included $100,000 in hotel-reservation revenue and $7,500 collected in taxes, the company says.<\/p>\n<p>\u201cMany businesses benefited during our traditionally slower summer months,\u201d said Belia Alvarez, Heritage Hotels\u2019 regional manager. \u201cAt our\u00a0hotels, we were able to keep our team members fully employed as we saw a dramatic increase in room night sales for June.\u201d<\/p>\n<p>Other spaceport-related events have boosted regional tourism too, Alvarez said. And since 2010, Virgin Galactic staff and future astronauts have stayed at her company\u2019s hotels when they\u2019re in town for business or to tour the area. The partnership with Virgin Galactic has generated more than $250,000 in revenue for the company and resulted in nearly $21,000 in taxes collected, the document states.<\/p>\n<p>As part of that partnership, Hotel Encanto has in recent years invested in upgrades to its VIP suites, pool area and other outdoor spaces. The hotel is \u201cfully committed to providing a 5-star deluxe VIP service to the astronauts and others who travel to our area as part of the spaceport experience,\u201d Heritage Hotels founder and CEO Jim Long said in <a href=\"http:\/\/www.hhandr.com\/sites\/hhandr.com\/files\/website\/pdf\/HH_Encanto.VirginGalacticVer71MT.doc%20%281%29.pdf\" target=\"_blank\" rel=\"noopener noreferrer\">a 2014 news release<\/a>.<\/p>\n<p>Other business owners said they\u2019re also seeing an impact, though to differing degrees. Visitors, vendors and employees associated with the spaceport have stopped at Milagro Coffee Y Espresso in Las Cruces, owner Bernie Digman said. He has also taken the shop\u2019s van to the spaceport to serve food and drinks at events.<\/p>\n<p>Truth or Consequences Brewing Co., which opened in June, saw \u201csome spaceport traffic\u201d during the Spaceport America Cup, \u201cbut nothing major,\u201d owner Marianne Blaue said.<\/p>\n<p>\u201cWe did hear from a few guests that it was hard to get a hotel room this weekend in T or C because everything was all booked,\u201d Blaue said, \u201cso if I had to guess I\u2019d say the hotels in T or C saw a significant impact from the spaceport event.\u201d<\/p>\n<p>And there\u2019s Koenick, the owner of Dust &amp; Glitter in T or C, who also runs the movie theater there.<\/p>\n<p>\u201cDuring the Spaceport America Cup, I had customers who were spectators, parents of launchers, and some of the launchers themselves,\u201d Koenick said. \u201cAll of them spent money in my shop.\u201d<\/p>\n<p>The business brought by the spaceport isn\u2019t as much as Koenick sees during a holiday weekend when people visit Elephant Butte, but he said the spaceport has had an impact.<\/p>\n<p>\u201cIt\u2019s not as much as some people in the area expected or were sold on, but it\u2019s more than if there wasn&#8217;t a spaceport,\u201d Koenick said.<\/p>\n<p>If Virgin Galactic begins flying people into space, tourism could boom. The company says it has sold more than 600 tickets \u2013 some at a cost of $200,000, some at $250,000. Those future astronauts and people they travel with will spend several days in southern New Mexico.<\/p>\n\n\t\t\t<div id=\"slides-409015-6a0752b5c1aa011e68fb804e79667a51\" class=\"navis-slideshow\"><div id=\"409015-6a0752b5c1aa011e68fb804e79667a51-slide1\"><img data-lazy=\"https:\/\/nmpolitics.net\/index\/wp-content\/uploads\/2017\/08\/4.19.17-Hicks-Dan.jpg\" \/><h6 class=\"credit\">Heath Haussamen \/ NMPolitics.net<\/h6><h6 class=\"permalink\"><a href=\"https:\/\/nmpolitics.net\/index\/2017\/08\/is-spaceport-america-taking-flight\/#409015-6a0752b5c1aa011e68fb804e79667a51\/1\" class=\"slide-permalink\"><i class=\"icon-link\"><\/i> permalink<\/a><\/h6><p class=\"wp-caption-text\">Spaceport America CEO Dan Hicks discusses the spaceport\u2019s plans for future growth and infrastructure needs during a forum with economists and journalists at the spaceport in April.<\/p><\/div><div id=\"409015-6a0752b5c1aa011e68fb804e79667a51-slide2\"><img data-lazy=\"https:\/\/nmpolitics.net\/index\/wp-content\/uploads\/2017\/08\/4.19.17-Control-building-2.jpg\" \/><h6 class=\"credit\">Heath Haussamen \/ NMPolitics.net<\/h6><h6 class=\"permalink\"><a href=\"https:\/\/nmpolitics.net\/index\/2017\/08\/is-spaceport-america-taking-flight\/#409015-6a0752b5c1aa011e68fb804e79667a51\/2\" class=\"slide-permalink\"><i class=\"icon-link\"><\/i> permalink<\/a><\/h6><p class=\"wp-caption-text\">An outside view of a building at Spaceport America that includes offices, a meeting area and the control room. <\/p><\/div><\/div>\n<h3>What now?<\/h3>\n<p>So what\u2019s needed for the spaceport to take flight? Some say it starts with Hicks. Many state officials joined the economists in telling NMPolitics.net they\u2019re impressed with the new CEO and optimistic he can lead the spaceport to success.<\/p>\n<p>Sen. George Mu\u00f1oz, perhaps the Legislature\u2019s biggest spaceport skeptic, has sponsored <a href=\"https:\/\/nmlegis.gov\/Legislation\/Legislation?chamber=S&amp;legType=B&amp;legNo=267&amp;year=15\" target=\"_blank\" rel=\"noopener noreferrer\">legislation<\/a> to sell the spaceport in the past, unsuccessfully. After meeting with Hicks, the Gallup Democrat is taking a wait-and-see approach.<\/p>\n<p>\u201cI want to give this guy a chance to turn it around,\u201d Mu\u00f1oz said.<\/p>\n<p>Virgin Galactic\u2019s Firth spoke highly about Hicks\u2019 vision to grow the spaceport.<\/p>\n<p>\u201cI think you have now an executive director at Spaceport America who\u2019s got a vision of what\u2019s possible with the resources that he\u2019s got,\u201d Firth said. \u201cWe will do whatever we can to support Dan Hicks and the team.\u201d<\/p>\n<p>Funding issues, including tension over whether the state or local communities should shoulder more of the burden, need to be resolved. New Mexico\u2019s spaceport gets less public funding than facilities in Florida and Virginia. To attract new companies, Hicks\u2019 team has identified additional infrastructure needs, including hangars and runways.<\/p>\n<p>A professional economic impact study would provide a realistic assessment of the spaceport\u2019s status and help lawmakers, local communities and spaceport officials plan for the future. If the results are as positive as some economists and spaceport officials suspect, the state might be willing to provide additional funding going forward.<\/p>\n<p>The spaceport must also improve interaction with the public. NMPolitics.net documented multiple violations, and additional possible violations, of the state\u2019s transparency laws in the course of our reporting. Those impact public perception and trust in the project.<\/p>\n<p>And the biggie: Virgin Galactic has to get SpaceShipTwo into space with paying customers. That was the promise that sold New Mexicans on building a spaceport. It remains the thing that would reassure the public, said state Rep. Bill McCamley, D-Las Cruces.<\/p>\n<p>\u201cI think when Virgin starts launching a lot of these problems solve themselves, because you\u2019re going to see more employees here and you\u2019re going to see more people visiting, so it becomes a visible reality,\u201d McCamley said.<\/p>\n<p>Erickson said the spaceport \u201chas the potential for being an economic driver for the community.\u201d<\/p>\n<p>\u201cIt\u2019s a reasonably high-risk activity for a government to fund, but sometimes governments have to invest in the infrastructure to get the industry going,\u201d he said.<\/p>\n<p>McCamley pointed to the long-term plan he and other officials developed a decade ago for Spaceport America: By funding both economic development and education, they hoped to build a new economy and equip New Mexicans to land the good-paying jobs that would come with it.<\/p>\n<p>\u201cWhen we start moving in that direction, that\u2019s when this will start being a real success,\u201d McCamley said. \u201cBut it\u2019s getting there, and I think that\u2019s what&#8217;s important.\u201d<\/p>\n<p>Alvarez, the hotel manager, agreed.<\/p>\n<p>\u201cI fully expect Spaceport America to build on its early successes and become a strong regional economic driver,\u201d she said.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>An NMPolitics.net investigation finds challenges, but also reason for optimism.<\/p>\n","protected":false},"author":1,"featured_media":409446,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[115,118,107,3582,141],"class_list":["post-409015","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news-and-analysis","tag-dona-ana-county","tag-economy","tag-roundhouse","tag-sierra-county","tag-spaceport-america","series-spaceport-america"],"_links":{"self":[{"href":"https:\/\/nmpolitics.net\/index\/wp-json\/wp\/v2\/posts\/409015","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/nmpolitics.net\/index\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/nmpolitics.net\/index\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/nmpolitics.net\/index\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/nmpolitics.net\/index\/wp-json\/wp\/v2\/comments?post=409015"}],"version-history":[{"count":0,"href":"https:\/\/nmpolitics.net\/index\/wp-json\/wp\/v2\/posts\/409015\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/nmpolitics.net\/index\/wp-json\/wp\/v2\/media\/409446"}],"wp:attachment":[{"href":"https:\/\/nmpolitics.net\/index\/wp-json\/wp\/v2\/media?parent=409015"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/nmpolitics.net\/index\/wp-json\/wp\/v2\/categories?post=409015"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/nmpolitics.net\/index\/wp-json\/wp\/v2\/tags?post=409015"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}