Committee tables bill to change spaceport tax-district board after schools and Sierra County raise concerns

Representative Ferrari introduced House Bill 396, which would amend the Regional Spaceport District Act to change board composition, limit bond issuance authority and require gross receipts tax (GRT) revenue be used solely for bond repayment. The sponsor framed the bill as an update to reflect the distribution of payments and representation between Dona Ana County and Sierra County.

Shannon Reynolds, a Dona Ana County commissioner and long-serving spaceport board member, testified she wants board representation restructured to reflect the county’s larger financial contribution. Reynolds cited figures in committee testimony that Dona Ana County has provided the majority of funds for 20 years, noting the board previously issued $70,000,000 in bonds in 2010 and that, in 2017, $7,000,000 was released against the county’s vote and later determined by the attorney general to have been misappropriated.

School officials and educators told the committee HB 396 would reduce a longstanding 25% county retention of the GRT used for local spaceport-related projects—funds that school districts have used for STEM and other programs. Chris Valzano, a lobbyist for Las Cruces Public Schools, said the change would “end a significant funding stream” for multiple districts and could affect teacher payrolls, transportation and classroom programs. Rebecca Bartu, a board secretary from Truth or Consequences, and Truth or Consequences School Board President Christy Lafont estimated the change could cut roughly $200,000 annually from their district and more than $4 million from Las Cruces schools if implemented as described in testimony.

The New Mexico Spaceport Authority’s executive director, Scott McLaughlin, said the spaceport was intended to benefit the whole region and warned that changing the funding formula would “philosophically” reassign the project to the state and could affect the partnership balance that supported initial investment. Sierra County officials and the county attorney argued the bill may impair negotiated contractual protections guaranteeing equal board representation; Sierra County’s attorney urged rejection or referral to the state Attorney General to review constitutionality under contract-clause principles.

Committee members pressed on whether the bill would change how the 25% set-aside has been distributed to districts; sponsors said the county resolution has historically directed that money to schools and the committee substitute corrected a drafting error and does not remove the schools’ share. Members also discussed possible conflicts with a recently-passed House Bill 261 that touched on spaceport finance and the risk that altering bond and revenue terms could affect bond ratings; the Spaceport Authority recommended consulting the New Mexico Finance Authority on fiscal impacts.

Several lawmakers said the bill should not move forward without broader stakeholder discussions between Dona Ana County, Sierra County, the spaceport tax board, affected school districts and state finance entities. Representative Dela Cruz moved to table HB 396. The motion passed by voice vote with a final tally of 10 yes and 0 no; the bill was tabled.

Sponsor Reynolds said she intends to continue discussions during the interim and to pursue stakeholder meetings before reintroducing changes.