World View Enterprises — the firm where U.S. Senate candidate Mark Kelly was recently employed — was offered a rent deferral of more than $350,000 by Pima County as a result of the Covid-19 epidemic.
A condition of this deferral was that the Tucson-based firm, which leases a facility built for it with $15 million in county taxpayer funds, would not receive federal Paycheck Protection Program funds.
“Should tenant receive federal PPP funds subsequent to the signing of this letter, all outstanding payments become due and payable immediately,” says the repayment agreement letter from Pima County to the company, signed on June 26.
World View has received one of the largest federal PPP loans in Pima County — in the range of $1-2 million — according to the U.S. Small Business Association web site.
The company, which recently landed a $2 million deal with Pima County to produce a large quantity of surgical gowns, is behind in its rental payments, for using the facility that the county built for it.
“World View has not paid rent since April when the Pima County Board of Supervisors voted to defer its rent,” said Ally Miller, the lone supervisor to vote against the rental deferment measure. “To date they have deferred $295,833.35.”
Other tenants also received rental deferral agreements from the county, including the University of Arizona, Bank of America and Accelerate Diagnostics.
World View — which has received funding from Tencent Holding Unlimited, a firm connected to the Communist Chinese government — recently announced that its primary focus is spying from balloons floating in the stratosphere for governments and private clients.
Mark Kelly, former director of World View flight crew operations, was one of the first employees of the firm. A former NASA astronaut, Kelly was working for World View when its CEO, Jane Poynter, went to Beijing in November 2014 to obtain funding for the firm.
Kelly resigned from his position with World View in February 2019, when he announced his candidacy for the Democratic Party nomination for the U.S. Senate seat formerly held by the late Sen. John McCain. Kelly, husband of former U.S. Rep. Gabby Giffords, retains a World View stock investment of about $200,000, according to his campaign financial disclosure statement.
The firm’s leaders did not disclose its funding by the Chinese tech company when it went before the Pima County Board in 2016 to request assistance to set up shop in Tucson. World View obtained a facility in the Aerospace, Defense, Technology and Research park near Tucson International Airport.
World View was placed near Raytheon Missile Systems, Inc., a key U.S. defense contractor. That placement was made despite the fact that Raytheon had an agreement with the county to exclude “foreign-owned/Non-NATO country-based businesses” from its buffer zone.
World View, which received $22.1 million in investments from 2014 to 2016, did not disclose how much of that was from Tencent, whose CEO is listed as the wealthiest Chinese citizen.
When Pima County subsequently built a $15 million facility for World View, the firm’s leaders said they intended to transport tourists to the edge of space. However, no stratospheric tourists ever took those rides — although some individuals paid deposits on the $75,000 tickets.
Despite the failure of the company to produce the results it had promised, it has managed to maintain a positive relationship with county officials.
County officials signed a $2 million agreement in May with World View to produce surgical gowns “to aid in the protection during the pandemic outbreak of COVID-19.”
According to the “Master Agreement,” signed on May 8 by the county procurement officer, the unit price for each surgical gown to be made for the county is $3.25. The first year of the contract — which includes four more annual renewal options — is for $400,000.
Miller, who has served two terms as a county supervisor, said the gown contract never came up before the Board.
“I’m appalled that (County Administrator) Chuck Huckelberry executed this contract without any notification to the Board of Supervisors,” Miller said.
She said she believed the contract was given to World View to help the company, at the expense of the taxpayers. Miller said she did not know why the county would need more than 100,000 gowns.
“It’s really a way to keep them afloat,” Miller said. “There was no competitive bidding on the contract. Huckelberry didn’t bring it before the Board of Supervisors.”
The county administrator followed up on this purchase with the added expense of a building to house the gowns.
“Huckelberry just bought a building for $3.4 million to store the personal protection equipment,” Miller said. “Why would you need to store it if there was a demand for it? The use of $2 million of taxpayer money for this is very questionable.”
The county board was informed of the purchase of the building, at 350 East Toole Ave., on Monday.
The World View contact person listed on the Pima County Master Agreement for surgical gowns is Jane Poynter, the former company CEO. A phone call to the accompanying number — which responded with a voice mail as a World View number — was not immediately returned.
In order for the initial phase of the contract to be fulfilled by May 10, 2021, the company will have to produce 123,077 new surgical gowns.
“When you figure the number of gowns that will illustrate the absurdity of the contract,” Miller said. “I intend to visit that building shortly. I want to tour the facility to see how the gowns are being made. I intend to later see what a stockpile of 123,000 gowns looks like.”