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New Spaceport Authority Chief Pulls the Plug on a $1.3 Million Contract

By Colleen Heild
Copyright © 2011 Albuquerque Journal
Journal Investigative Reporter

          Albuquerque-based Procurement Solutions started working at Spaceport America in 2007 as project manager after winning a one-year contract capped at $127,000.
        The role of the company, owned by Mike Holston, expanded rapidly as new duties were added to the initial tasks, such as securing leases, meeting with area ranchers and obtaining initial licensing from the Federal Aviation Administration.
        Eventually, Holston dealt with Virgin Galactic, the planned anchor tenant for the commercial space hub; prepared talking points for the chief of staff of then-Gov. Bill Richardson; and even acted for a time as executive director of the Spaceport Authority.
        The latest contract, signed in the fall 2010, would have paid Procurement Solutions $1.3 million over about two years, with Holston himself receiving about $200,000 a year.
        But the Spaceport's new executive director, who was hired after Gov. Susana Martinez replaced Richardson appointee Rick Homans, has pulled the plug on that agreement.
        Executive Director Christine Anderson told the Journal in a recent email that a state employee ought to do the job instead of an outside contractor.
        "It is my philosophy that a person who commits government funding, gives direction to government employees, manages government contracts and acts on behalf of the NMSA Executive Director should be a government employee," her email stated.
        "Accordingly, I terminated the Procurement Solutions contract 14 months before its expiration date, and am in the process of appointing a government employee to be the new Spaceport America Operations Manager."
        Small contracts may be awarded for other services performed by the company.
        The decision to cut ties wasn't made for financial reasons, Anderson said, "but on an annual basis, including the cost of the operations manager, we anticipate to save 25 percent of taxpayer money, nearly $200,000."
        'Competent job'
        Anderson said she was acting in the best interests of the state.
        "With my background in acquisition and management, I have been performing many of the duties that had previously been performed by Procurement Solutions until the new government Operations Manager assumes that role later this month." The job will be a classified position, which provides for more job security than a governor-appointed post.
        In one of her last jobs, from 2000-04, Anderson was director of the Military Satellite Communications Joint Program Office at the Air Force Space and Missile Systems Center in Los Angeles.
        In that position, she saw the launch of five military communications satellites aboard Titan IV and Delta IV rockets from Cape Canaveral in Florida from 2001-03. Before that, Anderson spent 8 1/2 years working at Kirtland Air Force Base as a civilian.
        Holston's departure eliminates a considerable amount of institutional memory collected since work on the $209 million project began.
        "Mike did a competent job," said former Spaceport board member Patrick Beckett of Las Cruces. "He definitely had a lot of responsibility."
        Just after taking office in January, Martinez axed Homans, who said he first pitched the project to then-Gov. Bill Richardson in 2003 and oversaw much of its planning.
        Holston was in effect second in command and oversaw major aspects of the project from design to planning to construction.
        Documents reviewed by the Journal show his firm's duties have included meeting with the Bureau of Land Management, White Sands Missile Range officials, the public and even helping draft the job descriptions of the top state employees to be hired at the Spaceport.
        Holston also contracted with several other professionals to perform specific tasks, such as overseeing the progress of the construction, which has hit a few snags along the way and is behind schedule.
        Holston, in an email, said his contract with NMSA "ended amicably, new Executive Director Chris Anderson told me that her intent in closing out our contract was to transition our previous responsibilities over to State employees."
        The Spaceport Authority had a staff of about six people, including Homans, who was paid nearly $174,000 before he left. Anderson is paid $125,000 a year.
        Resource issue
        Funding for the planning, design and construction of the Spaceport has come from state appropriations and local taxes assessed by two southern New Mexico counties.
        Homans was Cabinet secretary at the state Economic Development Department when he signed off on the Procurement Solutions contract in early 2007.
        The contract, which was awarded after a competitive bid, was initially capped at $127,700 for one year. A contract document states that it was "necessary to have a hands on person on this project at all times" and the department didn't have a "qualified individual in house to facilitate this project."
        That contract was extended and the cap increased to $456,990 by March 2008.
        The duties expanded during that time, according to contract documents reviewed by the Journal. Invoices show that, among his varied assignments, Holston worked on "talking points" for the governor's chief of staff.
        A check of state records shows Procurement Solutions' work ended in June 2009, under then-Executive Director Steve Landeene. Landeene's resignation the next spring led Richardson to appoint Homans as his successor.
        Homans declined to comment for this story, but has said previously that he realized upon his return to the project "we had a serious resource issue."
        He went to bid again for a project manager and Procurement Solutions won a much bigger contract that called for payment of $575,000 the first year and $725,000 in the second year.
        That was to pay for work on issues such as environmental mitigation, current and future construction, visitor and tourism aspects, economic development, licensing, setting up procurements, and include startup and operational duties.

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