California has lagged other states in enacting measures to support commercial space companies, but is now working hard to catch up. On Wednesday, the California Assembly passed AB 777 on a 69-5 vote. The bill would grant an exemption to property taxes for equipment “that has, or upon manufacture, assembly, or installation has, space flight capacity” of various forms, as well as property that would be flown on such vehicles, as well as fuels “used exclusively” for spaceflight. The tax exemption would remain in place until July 2024.
While the bill benefits any firm that has “a primary business purpose in space flight activities,” the company that triggered the legislation is SpaceX, after it received a property tax bill from Los Angeles County, Reuters reports. The bill was introduced by Assemblyman Al Muratsuchi (D), whose Southern California is near, but does not include, SpaceX’s headquarters and primary manufacturing facility in Hawthorne. The California State Association of Counties opposed the bill since they will lose out on an estimated $1.1 million a year in tax revenue should this become law.
AB 777 isn’t the only space-based legislation California’s legislature took up this week. On Monday, the Senate unanimously passed SB 415, which clarifies that an “informed consent” waiver provision for commercial human spaceflight is not “contrary to the public policy of this state.” That bill was introduced by Sen. Steve Knight (R), a vocal proponent of the state’s commercial space industry who has expressed an interest in running for the US House seat held by the retiring Rep. Buck McKeon (R-CA).
While California looks to give tax breaks to space companies there, one New Mexico legislator is seeking to better spend tax money being collected for that state’s commercial spaceport. New Mexico Sen. Lee Cotter (R) introduced this week SB 172, a bill that would require local sales taxes earmarked for Spaceport America be spent solely on paying off bonds for building it. Cotter recently expressed concern that the New Mexico Spaceport Authority was using the sales tax revenue to pay for spaceport operations, which he considers to go against the intent of voters in two southern New Mexico counties who voted for the tax in 2007 and 2008.
Spaceport officials say the tax revenue is needed to cover operations at a key time for the spaceport, whose major facilities are essentially complete but whose anchor tenant, Virgin Galactic, has not started operations here. “This money is really critical,” Christine Anderson, executive director of the New Mexico Spaceport Authority, told the Las Cruces (N.M.) Sun-News. “It’s really protecting the investment of the taxpayers because if we don’t have that, we may have to close the spaceport.”