A new aerospace technology company will headquarter in Cedar Park pending the approval of an incentive agreement by City Council and the finalization of a building lease.
Firefly Space Systems stands to gain $1.225 million in incentives and employment grants from the city of Cedar Park's Economic Development Corporation, or 4A Board, which approved the incentive funding Sept. 15. City Council is scheduled to hear about the deal Sept. 25.
Firefly Chief Operations Officer PJ King said the company is in the final stages of designing an orbital launch vehicle for small satellites. Cedar Park is an ideal location because of its proximity to Firefly's 200-acre test site in Briggs as well as the University of Texas at Austin's engineering program and advanced computing center, King said.
"The state's regulatory climate is very attractive to us," King said. "The thing that really impressed me is at every meeting we introduced this project the first four words everybody has said to me have been, 'How can we help?' I have to say it's an amazing thing and really impressive."
Current Firefly staff would relocate from California to Cedar Park, King said, and by 2019, 200 employees, including avionics, structural and propulsion engineers as well as administrative and operations staff, would headquarter in the city and receive a total annual payroll of about $12 million.
Finalization of the lease agreement at an undisclosed 20,000-square-foot Cedar Park office site is contingent upon approval of the incentive agreement by City Council, King said. If approved, Firefly will initially receive $250,000 for facilities relocation and can earn additional employment grants when the company reaches hiring benchmarks, said Larry Holt, Cedar Park assistant economic development director.
"Two hundred jobs is a very significant project for us. These jobs average out—and the company has committed—to $60,000 [annual salary per] job. That's above the [Williamson] County median wage, and that is the number we typically focus on [when considering] are the jobs high-paying," Holt said. "The interesting thing ... is the companies that offer the highest payoff to the community are in the aerospace industry. Aerospace manufacturing has the highest multiplier of any manufacturing."
Holt said Firefly will invest about $7.5 million in property, plant and equipment during the length of the 10-year agreement. The agreement also includes provisions that penalize the company if it loses positions.
Firefly will receive a payment of $243,750 when it has 30 employees and another equal payment when 50 employees are hired. An additional $243,750 is offered at both the 110- and 200-employee benchmarks. If the company reaches 80 employees in 2017, it will receive half of the 110-employee benchmark grant, or $121,875, in advance. The $250,000 facilities relocation payment plus the employment grants total $1.225 million.
About Firefly Space Systems
Firefly was founded in California in January 2014 by King, CEO Thomas Markusic and Chief Financial Officer Michael Blum. King said the company aims to provide low-cost, high-frequency rocket launches carrying satellites up to about 800 pounds. The customer's cost per launch would be about $9 million compared with current competitors' rates of around $30 million per launch, he said.
"Once upon a time, only governments could do this kind of project. And then about 10 years ago the brave billionaires stepped in and I think really proved to the world that there's something possible here," King said. "What we've essentially done is crowd-sourced multimillionaires, which is the next step in the project."
Following the completion of design, Firefly aims to begin testing methane and oxygen-powered rockets in 2015, have the first suborbital launch at the end of 2016, and complete its first orbital launch in 2017, King said.
Though the company is considering locations in Florida and Alaska, King said Firefly hopes to find a location in Texas that could host the rocket launch site.
"We would really love to do one in Texas, because then we would have a triple whammy with design/engineering, testing and a launch site all in one place," he said.
