The Legislature gave final approval Monday to a proposal that Gov. Susana Martinez says is critical for New Mexico to develop a commercial space travel industry.
Legislation to limit the liability of spacecraft manufacturers and their suppliers is heading to the Republican governor, who is expected to sign it into law.
While the proposal was pending in the Legislature, the state had placed on hold its negotiations with space tourism company Virgin Galactic for a long-term lease at New Mexico's spaceport, which has cost taxpayers more than $200 million.
British billionaire Richard Branson's Virgin Galactic plans on flying tourists into space from the nearly complete spaceport in southern New Mexico.
Virgin Galactic, as a space travel operator, already is shielded under a 2010 law from being sued in most cases by passengers or their families if there is an accident during a flight.
The legislation will extend the liability limitations to suppliers and manufacturers of spacecraft and their components.
The restrictions on damage lawsuits will apply only to passengers - not to people and property on the ground.
Other states, including Florida, Texas and Colorado, have agreed to liability limits in hopes of developing commercial space travel industries.
The New Mexico measure had stalled in previous years but cleared the Legislature this session without opposition after Virgin Galactic and trial lawyers agreed on the scope of the legal protections and a provision requiring companies to carry $1 million in insurance to qualify for the liability protections.
"For two years, Gov. Martinez has called for legislation that makes New Mexico a more competitive place for commercial spaceflight and protects the investment taxpayers have already made in Spaceport America. This measure is long overdue, and she is hopeful that it will improve New Mexico's competitiveness in this industry," said Enrique Knell, a spokesman for the governor.
The measure won final approval when the House unanimously agreed to a Senate-passed version of the proposed liability shield.
The legislative session ends Saturday and many major issues remain unresolved, including a state budget and proposals to revamp public employee and educational pension plans to improve their long-term solvency.