Venture capitalist says Oklahoma's on the right track
06/12/2001, The Journal Record Dolan Media 2001 (Copyright 2001)

Bill May

Our Legislature made the right decision when it set up the Oklahoma Space Industry Development Authority, according to a Baltimore venture capitalist.

The only thing is, according to Arthur Aubrey, there must be more publicity on the plan to bring space launches and related activities to western Oklahoma.

"You are doing the right thing, creating a governmental body to supervise the operation, yet going into partnership with private enterprise," he told the authority.

His presentation to the OSIDA was a history lesson on how major cities developed early in our history.

"At one point, Philadelphia was the largest city in the United States, but New York wanted that honor, so they started the Erie Canal," he said. "That brought new goods and services into New York and provided an outlet for goods manufactured in New York."

There are dangers in this area, he cautioned, pointing out that some city-tax-supported ventures were too stringent, primarily with only one big private enterprise entity.

"But from what I have seen here, you are avoiding that problem," he said. "You are offering the infrastructure, complete with tax incentives, for a company to operate. At the same time, you are encouraging any and all viable companies to participate. This will keep it from becoming a corrupt operation."

The authority is heading efforts to turn the former Clinton- Sherman Air Force Base at Burns Flat into a huge space development complex.

Space is one of the next big transportation frontiers. It's appropriate Oklahoma is one of 14 states setting up launch sites, because the National Aeronautics and Space Administration is really not in the commercial launch business.

Another development, said board member Chris Shove, is that several companies are developing nano- and micro-satellites, some as small as credit cards.

"These tiny satellites won't need the powerful rockets that NASA operates to get a huge payload into orbit," he said. "We are developing this at the right time, because launch companies are interested in using less expensive vehicles.

"Manufacturers of these nano- and micro-satellites naturally will want to be near the space launch center, so maybe we could attract a few of them to Oklahoma."

Shove made his comments in reporting on a commercialization conference that he attended in France.

"When I talked about what we have here in Oklahoma, several companies, many of them satellite manufacturers, expressed an interest and want to view what we have," he said.

In the 11 months the board has been active, at least five companies have signed memorandums of understanding, stating their intention to operate at Burns Flat or the former Air Force base.

Two companies, TGV Rockets of Bethesda, Md., and Pioneer Rocketplane of Ann Arbor, Mich., have started seeking funding.

Patrick Bahn, TGV's chief executive, said one of the drawbacks keeping companies from entering the space program is insurance.

To counter this, board member Chris Shove suggested the authority become an insurance pool, writing policies that individual companies would buy. This would substantially lower the cost for insurance while protecting the public.

Aubrey attended the meeting as a venture capitalist interested in investing in the TGV Rockets plan. He inspected Burns Flat and the abandoned Air Force base. He also studied commission documents, along with state laws, as part of the due diligence prior to investing.

"I must say that I am impressed," he said. "You need to do a better job of informing the world what you have out there, though."

Friends and co-workers joked with him when he said he was going to Oklahoma to investigate a space launch site. "They couldn't believe it. They thought I was going to the edge of the world. But I assured them that you speak English and are civilized."

Aubrey stressed the value of western Oklahoma to the space launch community. "You've got to take advantage of all that you have out there to offer industry," he said.

America has become so jaded by the space successes for the past four decades that, despite the Challenger disaster, shuttle launches are once again yawned at.

But when Dennis Tito recently paid $20 million to fly a Russian rocket into space and spend a week on the International Space Station, it suddenly became big news, noted State Sen. Gilmer Capps, D-Snyder.

"His flight proved that people are willing to pay to take a space vacation," said Capps, who has led efforts to develop the Burns Flat base into a space launch facility.

"When I talked with him (Tito) about the ride, he said everyone is interested. He wants to make it possible for the average person to be able to take a vacation in space."

Capps was the board's representative to Washington at the space roundtable sponsored by the U.S. Senate.

One company that signed a memorandum of understanding is Space Adventures of Arlington, Va., the company that put Tito into the Russian rocket.

Space Adventures now provides training at the Russian launch center, complete with a Mig-22 jet fighter and an airliner converted to offer a few minutes of weightlessness to passengers.

That's what the company wants to bring to Burns Flat.

In an earlier presentation to the board, the company said all the training activities would be done at Burns Flat, as well as the launch.

Besides that, the company could set up some tourism draw, such as building a facility that resembles an astronaut training camp.

Other activities that have been suggested include building a Strategic Air Command museum on the site, which housed the unit's bomber and aerial refueling planes.

Some of the Cold War infrastructure is still in place and could easily be turned into museum exhibits.

One of the problems the board has had since it was established in July 2000 is that there was no full-time employee working for the agency.

To rectify that, board member Jay Edwards, then retired major general and former commander at Tinker Air Force Base, has been hired as director. His salary was set at $85,000.

Other states with similar operations pay the director upwards from $150,000, noted Shove, who was instrumental in setting up Spaceport Florida in the late 1980s.

"Even though he will be paid a salary, people in this state should realize how much General Edwards is volunteering to this state," he said. "We know he's worth $150,000, but there just isn't any money to pay him that."

It took legislative intervention for Edwards to become director. Until now, a member of a state board or commission had to wait two years after coming off that board to become a state employee.

Senate Bill 55, which authorized tax incentives for companies moving to Oklahoma to take part in the space activities, also changed to the law to allow a commission member to resign and become an employee.

Edwards verbally submitted his resignation immediately, but was told to put it in writing.

That was expected the next day.

The authority, which comes under the supervision of the state transportation and commerce departments, is funded with state and federal money.