TECH

Space Florida avoids budget cuts

James Dean
FLORIDA TODAY
On May 9, Space Florida President and CEO Frank DiBello addressed the National Space Club Florida Committee in Cape Canaveral.

Space Florida escaped cuts in next year’s state budget despite House Speaker Richard Corcoran’s targeting of other economic development agencies for dispensing what he calls “corporate welfare.”

Charged with growing aerospace business and managing spaceport infrastructure in the state, Space Florida received a total of $19.5 million for the budget year starting July 1, the same as this year.

Meanwhile, Enterprise Florida saw its operating budget cut by more than $7.5 million, to $16 million, and Visit Florida, dogged by a controversial deal with a rapper, had its budget slashed by more than $50 million, to $25 million.

Scott has threatened to veto the $83 billion budget, which he had not signed as of Friday.

Space Florida’s board of directors, which draws its members from Enterprise Florida’s board, considers itself fortunate.

"We can thank our lucky stars that various people in the House of Representatives did not get their hands on Space Florida," board member Jesse Biter remarked during a public teleconference on May 18.

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Corcoran’s office did not return a call to discuss Space Florida. Americans for Prosperity, the conservative Koch brothers-backed group that lobbied against Enterprise Florida and business recruitment incentives, said it would review Space Florida’s operations.

"We will take a look at Space Florida in the future to ensure legislators are being good stewards of taxpayer dollars,"said Chris Hudson, the organization’s Florida director.

Several lawmakers and board members said Space Florida is viewed differently than Enterprise Florida or Visit Florida — more like a transportation office supporting critical infrastructure than as a pure economic development entity.

It helps that Space Florida often partners with blue chip defense contractors like Boeing and Lockheed Martin and high-profile newcomers like SpaceX and Blue Origin. And Space Florida so far has avoided controversial headlines like Visit Florida’s $1 million deal with Miami-born rapper Pitbull, which led to its CEO’s ouster.

In September 2015, Blue Origin founder Jeff Bezos, joined by Florida Gov. Rick Scott, announced plans to build and launch New Glenn rockets on the Space Coast.

"We weren't seeing those same kinds of problems in Space Florida," said Sen. Jeff Brandes, head of the appropriations subcommittee that oversees the agency. "There's no doubt that Space Florida is something that I think we should continue to invest in, because it’s a very unique asset in the world, let alone in the country."

An economic development analysis by House staff recommended eliminating more than three-dozen programs “generally viewed as impediments to normal market forces, operating in a manner where government selects the winners and losers.”

The same analysis recommended maintaining Space Florida’s funding within a “category of programs (that) is largely associated with the aerospace industry, military and defense constituencies, and minority and rural communities.”

A governor’s office review of Space Florida last year “found an extremely sound operation” while recommending some policy changes concerning “public funds accountability” and monitoring by the Department of Economic Opportunity.

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Space Florida President and CEO Frank DiBello, whose $268,000 base salary exceeds that of counterparts at Enterprise and Visit, offered two reasons for state legislators’ support: "We don’t manage incentives. And, don’t mess with success."

Rather than offering money for in exchange for jobs, Space Florida primarily helps companies arrange financing for facilities or equipment that can be repaid over time, reducing up-front costs.

Space Florida also allocates $20 million annually that the state Department of Transportation provides in matching funds for improvements to  infrastructure, including hangars and launch pads at KSC and Cape Canaveral Air Force Station.

"We were able to show the (House) speaker and the president of the Senate how much Space Florida does for us in this county, and how much we needed it after the shuttle downturn," said Rep. Tom Goodson, whose district includes Kennedy Space Center.

DiBello acknowledged incentives like Gov. Scott's Quick Action Closing Fund — zeroed out by Corcoran — have played a role in most of its major deals.

"Not having them in the governor’s tool kit will hurt," said DiBello.

Biter said he hoped Space Florida followed guidelines to make sure further scrutiny does not turn up any issues that "cause a scene."

Any Space Florida contract worth at least $100,000 must be brought to the board for approval, and travel policies follow state law, Chief Financial Officer Denise Swanson said.

"Any state representative or senator that would go after Space Florida would have to have very good reason, and we’ve given them none," said Jason Steele, a former state representative who serves on the boards of Space Florida and Enterprise Florida.

Contact Dean at 321-242-3668 orjdean@floridatoday.com.And follow on Twitter at@flatoday_jdeanand on Facebook atfacebook.com/jamesdeanspace.