For most bankruptcy filers, financial distress is usually caused by relatively common events. Some common causes of financial distress include events like divorce, medical emergencies, and unexpected job losses.
In more extreme cases, there is also the occasional person who goes bankrupt trying to fly to the moon. According to reports from msnbc.com, the owner of a company that aimed to develop commercial spaceships for the general population is filing Chapter 7.
The struggling company, cleverly titled Rocketplane, declared bankruptcy after receiving more than $32 million in grant money from NASA.
In addition, the company gained almost $18 million in transferable tax credits from the state of Oklahoma, which used these credits to lure the company to the state’s spaceport.
Sources indicate that NASA does not expect to receive its money back, and Oklahoma’s taxpayers will likely have to swallow the loss as a risky investment gone bad.
Four years ago, Rocketplane initiated a project to build a reusable service vehicle for the International Space Station. However, the company couldn’t get its finances in order in time to build the vehicle, so NASA gave the project to another company.
When this NASA-supported space station project fell through, Rocketplane tried to reinvent itself as a builder of commercial passenger spaceships.
These spaceships, described in reports as "suborbital rocket-jet hybrid planes," would have lifted customers more than 62 miles into the sky.
This altitude would have allowed passengers the feeling of weightlessness and a tremendous view, all for the price of $250,000. Despite the high price tag, support grew for the project, as Rocketplane quickly planned to put tourist space ports in Hawaii and Florida.
While expectations were high, the dream of taking passengers from a barren field in western Oklahoma into outer space proved too costly to achieve.
In a poignant end for such an expensive project, the Oklahoma Gazette reported that one version of the ill-fated spaceship was recently found in an Oklahoma City metal scrapyard.
What kind of liabilities does a space-based company accrue? Rocketplane’s liabilities proved to be more mundane than one might think. They include debts owed to rental car companies, hotels, accounting firms, and thousands of dollars in credit card debt.
Perhaps more interesting are some of Rocketplane’s limited assets. Among these assets are four jet engines located at a plant in Canada. The value of each jet engine is $275,000.