LAS CRUCES, N.M. (AP) – Virgin Galactic said it will make the first-ever rent payment this month for use of Spaceport America in New Mexico as long as all the terms of its lease agreement have been met.
State officials have said the company will pay $85,833 monthly, according to a calculation based on information from the spaceport, the Las Cruces Sun-News reported.
The amount is one-twelfth of the $1 million a year charged to Virgin Galactic for use of the facilities. It will pay another $2,500 a month in rent for land.
The terminal-hangar, dubbed the Virgin Galactic Gateway to Space, is the main facility to be used by the company to launch tourists to suborbital space, once operations start. The first flights could happen late this year.
The lease agreement takes the space facility one step closer to financial independence, said David Buchholtz, a board member of the New Mexico Spaceport Authority.
“Certainly I look to that as a significant source of operating revenue going forward, so that we don’t have to draw on other public sources,” he said.
Authority executive director Christine Anderson said the rent will begin accruing Jan. 15.
Due to delays in both the construction of Spaceport America and development of Virgin’s spacecraft, the company hasn’t begin paying rent on the facility, which is located in remote southern New Mexico, about 45 miles from Las Cruces and 200 miles from Albuquerque.
An unsigned, undated copy of the lease agreement provided by the state calls for Virgin Galactic to be penalized $2 million if it breaks it lease with New Mexico and then begins flying elsewhere within two years. But state officials said the company won’t post that deposit until it activates the lease.
The New Mexico Spaceport Authority did not immediately respond to emails or phone messages from The Associated Press asking if Virgin Galactic had posted a $2 million deposit.
In a statement, the London-based Virgin Galactic told The Associated Press it was committed to paying rent once the authority has met the conditions of the lease.
“NMSA has indicated that they will have achieved this by the 15th January. Subject to VG’s review and confirmation that all the conditions (as agreed in recent discussions) have been met, VG will start paying facilities rent on the Gateway Facility,” the company’s statement said.
Virgin Galactic said late last year that it would re-think its plans in New Mexico if a bill that would prevent lawsuits against spaceflight parts manufacturers fails again in the Legislature. Spaceport supporters have said the law change is crucial to the facility’s future.
Republican Gov. Susana Martinez has pushed unsuccessfully for two years for legislation to protect the manufacturers from legal liability.
Save Our Spaceport Coalition, a group of aerospace-related companies and business associations, said in November they would tout the benefits of New Mexico’s Spaceport America and the need for the legislation.
A certificate of occupancy was awarded for the terminal-hangar in September, and the building was deemed complete by the architect on Nov. 15, Anderson said. The lease calls for rent payments to begin 60 days after that date, she said.
Since November, contractors have been working on minor building details, and there may be a few things left to do even after Jan. 15, she said.
“We’ll have a plan to complete the rest; there’s no loose ends after that date,” she said State officials also said a funding shortfall for construction of a southern road to the spaceport, important to Las Cruces, is prompting them to seek another $3 million from the Legislature for the project.
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