Not ‘Lost in Space’: Legislation seeks to boost Florida for launch business
Image via AP.

SpaceX launch
'Zero G Zero Fee' bills would create tax exemptions for anything launched into space from Florida.

What if a company could launch a rocket into space from Florida and pay no sales tax on the rocket, its payload, its fuel or even the concrete, steel and equipment needed to create the launch pad?

That would be the reality if lawmakers this Session approve legislation from Sen. Tom Wright and Rep. Tyler Sirois (SB 1466, HB 65).

“What it looks like the state Legislature is doing is trying to create the most favorable environment possible for capital associated with the space industry, to be competitive with other states,” observed Jared M. Stout, director of congressional and regulatory policy at the Washington firm of Meeks, Butera & Israel. Stout also formerly served as a staffer in the Florida Legislature and Florida’s congressional delegation, with ties to Florida’s Space Coast.

While tax exemptions on anything going into space from Florida might seem like a niche incentive now, with three or four dozen rockets going up each year, the stakes are far greater for the not-too-distant future. So too are the prospects of revenue from any exempted taxes. The commercial space industry is emerging and growing so rapidly that hundreds of launches a year are projected before the end of the decade.

There are a lot of companies that are already space-bound, starting with Boeing, Lockheed Martin Space, SpaceX, United Launch Alliance, Sierra Nevada, Northrop Grumman, Virgin Orbit, Blue Origin and Firefly Aerospace. There are also innumerable startups and others emerging, preparing their own launch vehicles, payloads and space businesses.

Satellites and astronauts are going up. Space tourism began last year. A zero-gravity manufacturing sector is being created, and all sorts of private zero-gravity research is planned in short order. Private companies are developing their own private space stations, and NASA is helping to fund them. Private trips to the moon could be possible soon.

“It’s a fascinating time,” Sirois said. “You have a lot of things that are going on and my view is we’re very much in this Wright brothers stage of spaceflight. So what I want to do is make Florida the leader, a very competitive place for these companies to set up shop.”

He noted that some members of Congress suggested the federal government might want to tax flights, and Sirois responded, “I think that is exactly the wrong message to send to the industry at this time.”

Sirois, of Merritt Island, and Wright, of Port Orange, have dubbed their bills “Zero G, Zero Fee.” The measures would make launches, launch vehicles and their payloads tax exempt for the next 20 years, provided they launch from Florida. The legislation includes a sunset clause so the Legislature can reevaluate lost revenue and the need for incentives again in 2042.

At the same time, Republican Rep. Rene Plasencia of Orlando has introduced HB 9233, which would provide a $10 million appropriation for Florida to build a new multiuser launch pad at Cape Canaveral. Space Florida, the state’s space business development agency, has talked about the need for a launch pad that could be leased on a per-launch basis by companies that don’t have their own launch facilities, as SpaceX, United Launch Alliance and others do.

“We’re running out of usable launch pads,” said Plasencia, whose district includes Titusville on the Space Coast. “There’s a lot of newly formed rocket companies that are launching rockets and building rockets. And we’re in direct competition with other states, other countries, to get these companies to move their facilities to the state of Florida. And one of the things we can do is to make sure we have enough launch pads.”

Competition for launches is emerging just as fast as the commercial space industry. California, Nevada, New Mexico, Texas, Colorado, Alabama, Georgia and Virginia are among other states wanting big pieces of that business, and some are already operating active launch sites. There are also numerous overseas launch sites.

Stout said the United States is leading the world in developing space entrepreneurship. But much of that is happening outside Florida.

“The competition for space companies is very fierce,” Stout said. “There are a lot of states out there interested in bringing space technology to their state. So if a state is interested in attracting space business over other states, obviously a favorable regulatory environment and a favorable tax environment would certainly be reasons to move to Florida.

“From that perspective, it really is the old adage that capital goes to where it is treated best,” Stout added. “I’m not sure I’m aware of any other states that are being as aggressive as this (Florida proposal) seems to be.”

Nonetheless, he noted that space companies are also looking for available, well-trained workforces.

“The workforce is a huge factor in some of these decisions. I think one reason so many tech companies end up in California is because of the workforce available in California,” Stout said.

But he also noted that the space business workforce is beginning to build back out again in recent years after a long and difficult drop following the 2011 demise of NASA’s space shuttle program.

Sirois said he is not aware of any other states offering or proposing tax exemptions.

“We would be the first to offer a ‘Zero G, Zero Fee’ concept, which to me is an exciting statement for Florida to make in terms of the priority we place on this business sector,” Sirois said. “I want to make Florida the location where you can launch, land, refurbish, prepare payloads, and I want to do it in a way where government is not a hurdle.”

Scott Powers

Scott Powers is an Orlando-based political journalist with 30+ years’ experience, mostly at newspapers such as the Orlando Sentinel and the Columbus Dispatch. He covers local, state and federal politics and space news across much of Central Florida. His career earned numerous journalism awards for stories ranging from the Space Shuttle Columbia disaster to presidential elections to misplaced nuclear waste. He and his wife Connie have three grown children. Besides them, he’s into mystery and suspense books and movies, rock, blues, basketball, baseball, writing unpublished novels, and being amused. Email him at [email protected].


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