One of the potential cost-saving measures that was recommended during the Walker-Mallott transition conference this weekend was doing away with the Alaska Aerospace Development Corp., the corporation that runs the Kodiak Launch Complex, which was recently renamed the Pacific Spaceport Complex-Alaska. Part of that renaming had to do with the corporation’s planned expanded mission, which, if it continues, would include “other aerospace business pursuits.” Such ideas include selling geospatial data and satellite imagery. According to the minutes of an August board meeting, which met a few days after the last failed missile test that left the facility greatly damaged, “launch operations alone may not generate sufficient revenues to maintain financial stability of the Corporation.”
The Aerospace Corp. was founded in 1991, and in 1994, it chose Kodiak as the place to build the launch pads for the missiles that were part of one of the nation’s first independent spaceports. From the start, it was controversial and way over budget. But in 1998, the site launched its first missile and hope soared. The site, about an hour’s drive outside of Kodiak, was expected to get multiple annual contracts from the military and Kodiak was supposed to experience an economic boon.
None of that happened. All told, the site has seen 17 missions, including the last fiery-ball of one. The total cost since 1998, according to the corporation’s financial reports: $41 million from the state, about $151 million from the feds. It’s generated about $141 million from the government for launches.
It costs about $8.5 million to keep the lights on, the employees paid and the pencils sharpened. In 2012, the corporation told the state that in order to stay afloat, it would need $100 million to upgrade the facility to accommodate bigger loads. The state appropriated $25 million and said that it would consider giving it the remaining funds when the corporation could prove that it had contracts in hand.
By August, before the rocket blew up at the site, it hadn’t procured those contracts.
Insurance will likely pay for most of the damage caused by the August blow up. But the question remains: Should the state give the corporation the remaining money to build larger pads that appear to be necessary in order to have a prayer of being viable?
During times of declining revenues and looming deficits, Is it time to give up on the aerospace business?
According to legislative committee minutes, here’s what outgoing Rep. Alan Austerman, who sits on the board and represents Kodiak, said in February about the state continuing to fund the corporation:
Chair Austerman stated that the corporation planned to get contacts for a long term facility or to faze (sic) themselves out. He hoped that there was a business plan that involved launches 3 to 5 times per year that made the facility viable, but that at the rate things were going it seemed doubtful. He said that the corporation was on notice to make it work or get state money out of the business.
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