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Sierra County Commission selects Commissioner Jim Paxon to serve on board overseeing Spaceport tax revenues

by Kathleen Sloan | January 12, 2021
3 min read
Spaceport America's self-described "family" as of February 2020. The tax board will soon review a 2017 decision that allows excess gross receipt tax revenues to be used for operations, including salaries. Photograph courtesy of Spaceport America

The Sierra County Commission held a special meeting on Jan. 12 to select a new representative to serve on the Spaceport America Regional Spaceport District Board in advance of an expected vote on the allocation of the Spaceport’s gross receipts taxes.

Sierra County Commission Chairperson Jim Paxon was selected, replacing Frances Luna, who finished her eight-year maximum term as a county commissioner at the end of 2020.

At a SARSD Board meeting scheduled for Jan. 21, Paxon will join the other five board members in deciding if excess GRT revenue not needed to pay off the yearly debt on the Spaceport’s construction bonds can continue to be used to pay for Spaceport operations, including salaries.

The SARSD Board oversees the expenditure of about $7.5 million in GRT revenues dedicated to the Spaceport annually. It consists of two Sierra County commissioners and two Doña Ana commissioners and two other members appointed by Governor Michelle Lujan Grisham to represent each of the counties. The governor’s most recent appointees were named in July 2020.

The Sierra County Commissioners are Jim Paxon and Travis Day. Sidney Bryan, a Truth or Consequences real estate broker, is the Sierra County governor-appointee.

The Doña Ana Commissioners are Shannon Reynolds and Lynn Ellins. Wayne Savage, executive director of Arrowhead Research Park at New Mexico State University, is the Doña Ana County governor-appointee.

The Spaceport America Regional Spaceport District Board was formed by state laws 5-16-1 through 5-16-13 in 2005, with Sierra County choosing to join the district in 2008, along with Doña Ana County, which joined in 2007.

Desiring to become part of the district for economic development reasons, each county had to pass a gross receipts tax dedicated to the Spaceport at the polls. The tax could not exceed half a penny on each dollar of commercial purchases, according to the law. Both counties succeeded in passing a .25 GRT tax that expires in 2028.

Doña Ana County now collects about $7 million and Sierra County about $500,000 in Spaceport GRT a year.

The state law governing the Spaceport GRT—7-20E-25B—requires at least 75 percent of the proceeds go to the “financing, planning, designing and engineering and construction of a spaceport or for projects or services of the district pursuant to the Regional Spaceport District Act.” It further stipulates that no more than 25 percent of the revenue can be spent for “spaceport-related projects, as approved by resolution of the governing body of the county.”

Sierra and Doña Ana county commissions passed resolutions designating that 25 percent of the GRT proceeds go to educational purposes. The counties disburse this revenue stream.

The remaining 75 percent of the proceeds goes to the New Mexico Finance Authority, the counties having signed intercept agreements with NMFA that will pay off the Spaceport’s construction bond debt. The bond debt principal is about $115 million, with about $70 million still to be paid.

The NMFA will give a report on the bond debt at the upcoming SARSD Board meeting.   

The board last met on June 12, 2017, according to Sierra County Commissioner Travis Day. In an interview with the Sun on Jan. 12, Day agreed the SARSD Board is required to meet once a year, but has not done so. “This will be my first meeting,” Day said, although he has served as a county commissioner since January 2019.

During the June 12, 2017, meeting, the SARSD Board voted to permit the expenditure of excess GRT for operations.

Day told his fellow county commissioners at their special meeting today he expects the SARSD Board meeting “will be contentious.” In December, the Doña Ana County Commission passed a resolution stating that excess GRT should not go to Spaceport operations.

“Not only that,” Day said to the Sun, “they want to be paid back the money that has been spent on operations.”

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Kathleen Sloan is the Sun’s founder and chief reporter. She can be reached at kathleen.sloan@gmail.com or 575-297-4146.
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