The New Mexico Spaceport Authority board of directors met for almost three hours on Dec. 2, trying to correct its lack of oversight that partly led to Spaceport America’s having been led off-mission by recently fired Director Dan Hicks.
The meeting was the first since the release of an independent forensic audit confirming Hicks’s mismanagement and financial abuses that led to his dismissal in October. (A link to the Sun’s article on the investigation can be found at the end of this story.)
The investigation conducted by the McHard Firm of Albuquerque revealed the Spaceport has no strategic plan to guide spending. This finding identified perhaps the biggest weakness in the board’s ability to exercise oversight and financial control and to keep the Spaceport on-mission.
During the December meeting the board asked Interim Executive Director Scott McLaughlin to hunt for Spaceport America’s mission statement and to bring it up for review at the next meeting. The board’s need to refamiliarize itself with this foundational document is another yawning example of the space center’s rudderless operation.
The board devoted most of the meeting to scrutinizing newly drafted board bylaws; examining Open Meeting Act requirements and its rolling-quorum infractions; defining the board’s and the director’s procurement caps; and approving a fair hiring process to govern the search for a new director.
In the last 20 minutes of the meeting, with little discussion and without the context that a strategic business plan provides, the board approved nearly $20 million in capital projects.
The project funds will come from capital outlay previously approved by the New Mexico legislature, McLaughlin informed the board. Most of the funds allotted in the enabling bills passed by the House and Senate defined spending parameters loosely as “improvements.” This highlights how essential is the Spaceport Authority board’s detailed understanding and rigorous oversight of costly capital improvements.
While Spaceport America does not have a strategic plan, governmental entities like NMSA are required by the New Mexico Department of Finance and Administration to undertake an annual planning process to forecast their capital improvement priorities for the succeeding five years. The resulting Infrastructure Capital Improvements Plan is used to guide state and federal spending. “Ninety percent of capital outlay funding is for ICIP projects,” explained Donnie Quintana, DFA’s local government division director, in a Dec. 4 interview.
McLaughlin, an engineer who joined the Spaceport management team as director of business development, clarified in a Dec. 7 email to the Sun that none of the approved projects are in NMSA’s 2022–2026 ICIP.
“These projects were previously funded through a variety of Severance Tax Bonds and General Fund Allocations legislated during the 2018, 2019, and 2020 Regular Sessions,” he stated. “Their implementations have been delayed by a variety of reasons but we expect to be able to execute all within the next 12 to 18 months.”
The interim director emphasized that the following projects approved by the board are “urgently required critical infrastructure developments that have been planned for some time. That is, these projects do not depend on a long-term vision, but rather are needed right now to support current site activities.”
SPACEPORT OPERATIONS CENTER
The board approved an expenditure of up to $750,000 to repair the Spaceport Operations Center, a 2012 building with a steel understructure and thin-shell concrete outer structure that is shifting and cracking because, according to McLaughlin, “water is not draining away from the building.”
The Sun asked McLaughlin for information regarding SOC’s designer and whether an effort has been made to seek reimbursement for faulty design or construction. The information had not been made available by press time.
Funding for the SOC’s repair will come from House Bill 306, passed during the 2018 regular session, which allotted $6 million in severance tax bond revenue to the Spaceport, of which $500,000 was “to plan, design, repair, construct, furnish and equip infrastructure upgrades, including electrical, fire suppression, water, sewer, security, mission control, heating, ventilation and air conditioning and building systems at Spaceport America facilities in Sierra County.”
Funding will also come from Senate Bill 280, passed during the 2019 regular legislative session. The bill allotted $19 million “to plan, design, construct and make improvements at Spaceport America in Sierra County.”
SPACEPORT TECHNOLOGY AND RECEPTION CENTER
The board approved up to $9 million to be spent on a new, multifunctional building.
In presenting this project to the board, McLaughlin showed a picture of an on-site Spaceport visitors’ center designed by the IDEAS Group in 2012. The firm also designed a proposed visitors’ center to be located on local businessman Randy Ashbaugh’s land next to Walmart. According to Ashbaugh, the IDEAS Group was paid millions of dollars to deliver build-ready plans for both visitor’s centers.
McLaughlin told the board no architect had been hired to design the proposed new STARC building. He reported to the Sun, however, that he expected to begin work with a design firm within approximately the next 45 days.
“We are researching what they (IDEAS Group) were paid,” McLaughlin wrote the Sun, “but this was quite a while back, so we do not have an answer yet. We used this picture out of convenience, but the STARC is not meant to be ‘the’ visitors’ center, but rather a multipurpose building for short-term rental space by onsite and other customers, a gathering space for meetings, a space for media events, the site-wide fiber communications demarcation, the IT server room (to allow removal of NMSA equipment from the Gateway to Space), a short-term facility for package drop-off and storage (currently a big issue for the front gate guards), STEM activities support, restrooms for staff and visitors (there are none nearby), a medical treatment area, a security office, a replacement for the 4000 square-feet Gateway to Space Gallery area, a badging area, an outside viewing area for onsite visitors, and other uses.
“Currently, the only space we have is the SOC, which is also our firehouse, security office, contains a few NMSA offices, and where an Emergency Operations Center (EOC) would be located for any crisis.
“The available funds will also be used to improve the front gate physical area, which has experienced difficulties for large trucks entering and exiting, and to increase parking for any visitors to the site. We anticipate very high use of the new STARC building, as it will be available for onsite rental or even non-Spaceport-related rentals if otherwise available.”
STARC funding will come from House Bill 349, passed during the 2020 regular session. The bill approved $10 million in severance tax bonds revenue to “plan, design, construct and equip a payload processing center, an information technology building and a visitor access control facility at Spaceport America in Sierra County.”
VERTICAL LAUNCH RAIL
The board approved $2.2 million be spent to build a vertical launch rail for small rockets. UP Aerospace, which is headquartered in Denver and was one of the first companies to begin operations at the Spaceport, is to build and design the rail and housing facility.
According to its website, UP Aerospace is a “space launch and flight test service provider specializing in advanced engineering, launch technology development, and state-of-the-art rapid and low cost launch operations.”
UP Aerospace was hired for this project in a sole-source procurement process. The McHard investigation of Hicks questioned why the project was not awarded through a competitive request-for-proposals process.
The project’s procurement document stated UP Aerospace will have exclusive use of the vertical launch rail, meaning public funds essentially will be used to pay UP Aerospace to be a Spaceport customer, the investigation stated. The investigators recommended an RFP be issued for the project.
The board did not mention this investigation finding during the December meeting. Spaceport Authority Chairperson Alicia Keyes, who is New Mexico Economic Development Secretary, did inquire if the rail “is for potential customers, not just UP Aerospace?” McLaughlin answered in the affirmative.
Senate Bill 280, referenced earlier, will be the rail’s source of funding.
VERTICAL LAUNCH AREA IMPROVEMENTS
The board approved up to $8 million to put in electric, water and sewer utilities and to improve the roads at the vertical launch area. Bathrooms with running water are needed “to attract tenants,” McLaughlin explained to the Sun.
Bill 280 will be the source of funding.
Although the nearly $20 million in spending approved at the Dec. 2 meeting was not guided by a strategic plan, the board has asked McLaughlin to draft a plan for its approval.
“A Strategic and Master Plan to address the short-, medium- and long-term operational requirements of the Spaceport will be defined and prepared in the very near future,” McLaughlin stated. “It will address the mission, vision, and current state of NMSA; its organizational structure; its business model, markets, objectives, goals and metrics; and its facilities, future infrastructure requirements, and corresponding capital investment plans.”