LOCAL NEWS

Virgin Won’t Walk Down Aisle Without More Runway

By Kathleen Sloan

HERALD Reporter

It’s been a long engagement period between Virgin Galactic and the New Mexico Spaceport Authority – and it just got longer.

Moving in together at Spaceport America was first predicted for 2011 or even earlier. Two major issues have kept them apart.

The first is getting the building ready for occupancy. At the NMSA Board of Directors’ meeting, held Wednesday, March 28, at Hatch’s City Offices, NMSA Executive Director Christine Anderson gave the latest prediction. Construction Industries Division will probably issue a Certificate of Occupancy (CO) in “June or July,” she said.

Sixty days after the CO is given, Virgin can move their construction crews in for fit-out of the interior, including the hangars, and start paying their monthly lease, which is $1 million per year. Can, but don’t have to. There is no definitive move-in date for Virgin stipulated in the lease.

The second reason for the extended engagement period between Virgin and NMSA has oft been repeated – Virgin will not fly until it’s safe. And it turns out the runway is too short for safety, making cohabitation an empty exercise until it is lengthened.

NMSA Executive Director Christine Anderson and Virgin Galactic representatives explained, at this late date, the 10,000-foot long runway needs 2,000 more feet.

Anderson said it will cost about $7.02 million – an estimate calculated by NMSA’s design firm, AECOM Inc., which is responsible for preparing design documents in coordination with third-party contractors.

“It will take between six and 10 months to design and construct,” she said.

Anderson, in an e-mail, Saturday, March 31, confirmed that the project will go out to bid.

According to Anderson, NMSA General Counsel Wade Jackson and Virgin Senior Program Manager Mark Butler, the development agreement –signed by the two parties on Dec. 29, 2008– Paragraph 5.2, says NMSA has to pay for any infrastructure required to make Virgin operational.

NMSA Business Operations Manager Aaron Prescott clarified, “That is, without which, they cannot operate.”

Paragraph 5.2 further states that Virgin can make such operational construction requests as long as they don’t cost NMSA more than $225 million – the state’s original budget in 2008. That has since been pared down to $209 million, said Anderson.

NMSA Board member David Buchholtz suggested that perhaps Virgin should pay for half or part of the runway. He pointed out that Virgin “had reviewed the plan and it has the 10,000 foot runway when they signed” in the development agreement.

Virgin’s Mark Butler said, “We were pressured to get the lease signed. But pretty early on we said we may need more runway and that clause was put in specifically to address possible new technical data.” The lease and development agreements are legally paired and refer to each other.

David Wilson, public relations manager for NMSA, after the meeting, said the state set a deadline and requirements for pursing the Spaceport America project. Virgin had to sign a lease and two out of three counties had to pass a gross receipts tax referendum by the end of 2008. Virgin signed, and Doña Ana County and Sierra County passed a one-quarter-of-one-cent GRT, which went into effect in January 2009. If those two things had not happened, the project would have been abandoned.

Buchholtz took another stab at it. He asked, “Staff has considered and there is no other choice?” referring to NMSA paying for the runway.

Anderson answered, “In 2008, the NMFA signed the development agreement. Yes. That is the prudent thing to do.”

NMSA Chairperson Rick Holdridge said, “After having been lawyered quite a bit, it seems we are obligated. I said to (Virgin Galactic President and CEO George) Whitesides that we could probably make this work, but this is it. That’s why we’ve come up with this compromised runway.”

Virgin Chief Pilot David MacKay explained those compromises. The spaceport is “high and hot.” At 4,600 feet above sea level, air is thinner. Heat makes air thinner still.

During takeoff, WhiteKnightII and SpaceShipII are joined. The aircraft has to travel faster to get engine thrust in thinned air. The 10,000-foot runway would allow takeoff in 50-degree weather. The 12,000-foot runway would allow takeoff in 85-degree weather – the difference between operating year-round and shutting down between April and September.

MacKay said the two vehicles, separate during landing, will glide back to Earth. Headwinds to slow them would be welcome, “but it’s not a precision landing, therefore a margin for pilot error and winds is needed.”

MacKay said, “2,000 feet makes a significant difference. SpaceShipII could land in 100 degrees Fahrenheit.” With the 10,000-foot runway, MacKay said the SpaceShipII could not land at all.

“It’s still small margins,” said MacKay.

NMSA Chairperson Holdridge noted there were no turnarounds on the extensions.

NMSA Board member and former NASA Astronaut Sid Gutierrez said, “It would affect Virgin. It’s not ideal.”

NMSA Executive Director Anderson urged lengthening the runway also to be more marketable. Competing runways are: Albuquerque, at 5,300 feet altitude, has a 13,800-foot runway; Denver, at 5,300 feet altitude, has a 16,000-foot runway; and Holloman Air Force Base, at 4,093 feet altitude, has a 12,917-foot runway. They also have crosswind runways of significant lengths, allowing for more predictable takeoff. Anderson and MacKay said the runway extension is not just for Virgin, but to make the spaceport viable to other space companies.

NMSA Board member Buchholtz asked, “Why was the original design for 10,000?”

NMSA Operations Manager Chad Rabon said, “15,000 was the original design.”

The runway’s placement to the north has very little room for expansion. Anderson said that end would add 800 feet and the south end 1200 feet.

John Roberts of Elephant Butte was project director for Gerald Martin, the construction management firm and owner’s representative for NMSA through the design development and pre-construction phases of Spaceport America. In an interview Friday March 30, he said, “I never really understood the site selection for the runway. There were significant discussions concerning the eventual requirement for a crosswind runway on both sides of the table and the close proximity to the electrical lines. During early conversations concerning the runway, the cost of burying the electrical lines to accommodate the crosswind was in a range of $8 to $10 million and was seen as a future development. The runway extension was seen as a fallback position to avoid the crosswind requirement.”

Robert’s assumed NMSA was reluctant to move the site further north, as it would have put them back into multiple-property-owner negotiations.

Montoya Construction won the bid to build the runway. David Montoya was interviewed Thursday, March 29. “When we were first approached about an extension, we were right in the middle of construction. They told us the extension had been overlooked and asked us to cease work on the ends of the runway. That was December 2009 through April 2010. They dangled a carrot, so to speak, in order to get concessions from us. They offered us a change order verbally. We gave them a price a couple of times and never heard back. We delayed this work as a courtesy, and they hadn’t come through with a contract and proposal. We sent a letter saying, ‘If you don’t tell us to stop, we’re going to have to continue.’ In the last month or so (two years later) we finally got a deductive change order, which eliminated work,” said Montoya.

Montoya said the extension for 2,000 feet may be all that is possible, not only because of limited budget, but also because the internal roads were put in, making a further extension on the southern end unfeasible.

“If they had made the decision in 2010, they could have averted all this. They could have changed the road,” said Montoya.

During public comment, Sandy Jones made related points. Jones was a board member of the Spaceport America Regional Spaceport District. He currently works as Sierra County Development Coordinator, but spoke as “a resident of Las Palomas.” He said the $7.02 million was “20 percent higher than the original runway price. That’s $1.2 million more than it would cost under the original contract.”

Montoya said, “We are interested in bidding on the extension, so we can’t give you the 2009 price we offered, but our change order price was significantly less than $7 million.”

Jones said, “Of course it will be a lot more now because a company will have to re-mobilize,” listing equipment and materials that will have to be transported back to the site.

Montoya says their bid for the 10,000-foot runway “was far beneath the original budget. We are very disappointed with their inaction. It cost us a lot of money.”

Montoya Construction is not in arbitration over this particular matter, but is in arbitration with NMSA over other work, said Montoya.

Roberts said, “I believe all the contracts with subcontractors included a clause that they have to go to arbitration –the arbitrator agreed to by both parties– before bringing suit.”

Jones, during public comment, said, “$330,000 of this year’s budget is going to attorney’s fees to settle contract claims. You hired all these private consultants and private designers. Has anybody given any thought to seeking relief from these private companies? Why is the state defending these private designers? Why is bond money being used to pay those claims?”

Jones’ question was not answered during the meeting.

NMSA Executive Director Christine Anderson, in an e-mail, answered, “The original runway was specified to be 10,000 based on the known requirements at the time. The requirements are now better known, as Virgin Galactic has performed more flight tests and analysis. This is a new requirement. It is not the fault of previous designers. We believe the 12,000-foot runway will make us more competitive for future customers as well as servicing our current anchor tenant’s requirements.”

Mike Massey of XCOR –the company that is developing a horizontal take-off, dual-ship system called Lynx– was interviewed Friday, March 30, about their runway length requirements.

“Here at Mojave, our runway is 12,500 feet, and that’s plenty. It gives us a lot of safety options. We also have a crosswind runway, which gives us another option. The Lynx Mark II has higher take-off and landing speeds. We use about two-thirds of it and the rest is for braking issues.”

It should be noted that the Mojave runway is 2,700 feet above sea level – 2,000 feet lower than Spaceport America. Therefore, Massey said he was not able to definitively state if a 10,000 or 12,000-foot runway was sufficient for their program.

But asked if they would consider operating out of Spaceport America with a 12,000-foot runway, Massey said, “Yes. We would consider using it as an operating center once we are closer to production. Of all these spaceports, New Mexico is closest to being real. They are near the top of our list.”

Just before the vote, Jim Hayhoe of Spaceport America Consultants, during public comment, said, “You’ve asked to modify not just the runway, but to modify the budget. I ask that you look at the budget impact before moving forward.”

The NMSA Board voted unanimously to build the 2,000 foot extension and to pay for it out of remaining funds from the original $209 million budget. Anderson showed several line items as “reduced,” without showing by how much.

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