The Florida Space Coast's economic resilience stems in part from a bold attempt to retool practices of the nation's aerospace industry in 2005, when NASA, industrial titans, and the State of Florida embraced an idea hatched by a handful of civic leaders in Brevard County.
Nearly two decades later, the John F. Kennedy Space Center's legacy business of rocket launches continues and is flanked by manufacturing facilities, a business ecosystem that helps mentor and fund high-tech start-ups, and an influx of residents who move in for jobs or to reside in a subtropical climate.
This is the economic environment that Raphael Bostic, president and chief executive officer of the Federal Reserve Bank of Atlanta, toured and discussed in April with local business and civic leaders. Bostic leads periodic trips to destinations around the Sixth District to learn about their economic drivers, challenges, and opportunities and to answer questions about how the Federal Reserve works.
"You all are on the front lines, right?" Bostic said in opening remarks to a group of business leaders during a roundtable hosted by the Space Coast Economic Development Commission (EDC). "This is why I love having these conversations, because you're going to have a sense of [economic shifts] before I do because you're living it. . . . Don't feel like you have to wait for us to call you. If you see something that is really different, pick up the phone and call somebody and let us know. We'd be very indebted and grateful for that. That'd be super helpful."
Several locals emphasized during the two-day visit that Brevard's economy is vastly improved from the bleak scenario portrayed in the still-discussed 2012 report, "A Hard Landing," by CBS's 60 Minutes. Then, the county was emerging from the Great Recession just in time to face the last Space Shuttle launch in 2011 and cutbacks in NASA funding related to congressional negotiations that ended the 2011 debt ceiling crisis, plus ensuing calls for frugality.
CBS journalist Scott Pelley observed in the segment, "Have a look around Brevard County. It's shrinking. Lots of people are moving away, taking businesses down with them."
"The 60 Minutes piece was devastating," said Lynda Weatherman, president and CEO of the Space Coast EDC and a former director on the Atlanta Fed's Jacksonville Branch board, who helped foster the 2005 turnaround plan. "Every company we were talking to stopped talking to me. It scared them. The worst thing for a business is uncertainty, and when [60 Minutes] threw uncertainty into the mix, it stopped everyone."
Not anymore.
Signs of economic vitality amid challenges
Bostic fielded numerous comments during the roundtable that portrayed a heated economy. Rising costs and payrolls and difficulty in hiring were threads of the conversation, as were effects of the Fed's interest rate hikes intended to curb inflation. Housing costs were discussed in the context of driving salary demands.
Brevard's current economy reflects its growing population, which census figures show increased from 543,573 to 616,628 (up 13 percent) from 2010 to 2021. Jobs pay well—28 percent are deemed higher wage, compared to Florida (24 percent) and the nation (25 percent), according to an Atlanta Fed report, and the median household income is $65,333. Figures in Brevard's Annual Financial Audit Reports show county revenues grew by almost 35 percent from 2012 to 2021.
Other signs of Brevard's economic vitality include:
- The $126 million replacement bridge being built 150 feet above the Indian River with federal and state funds to transport enormous rocket parts and payloads to commercial facilities operated at the space center by Lockheed-Martin, SpaceX, Blue Origin, and others. The first span opened in June; the second, under construction, has a January 2026 targeted completion date
- Continuing development of Viera, a master-planned community by the Viera Company on 20,646 acres of the A. Duda & Sons' Cocoa Ranch. Nearly half the development is complete, out of a total entitlement of 31,000 residences and 7 million square feet of commercial space. About 46 percent of the tract is reserved for open space
- Voter approval of property tax referenda in November 2022. One is projected to raise up to $50 million over 20 years to buy and develop almost 27,000 acres for greenspace. The other is to raise up to $50 million over four years to fund teacher pay raises and education programs.
The county's economic base includes entrepreneurs who got their start at Groundswell Startups, a nonprofit business incubator housed in a former skateboard park that Bostic visited during a 90-minute tour. Stops included a company developing a seat cushion with sensor technology, another devising a universal platform to control robots and drones, and a third working on communications and sensing solutions for the defense industry.
Groundswell was purchased, built out, and donated by founders Bud and Kim Deffebach. It offers more than retrofitted coworking spaces and a prototyping lab with 3D printing capacity. There's also a deep bench of mentors to share insights with entrepreneurs and a record of helping more than 40 start-ups secure seed-stage funding upwards of $5 million, according to CEO Jarin Eisenberg.
Aerospace and technology remain vital
Technology is the central theme of Brevard's business community, Eisenberg said. "If you're not an engineer, you can get a job, but there is a big gap in salaries between engineering and nonengineering positions, which I guess is likely typical in all areas but is highly concentrated here," Eisenberg said.
Brevard's aerospace and technology companies remain a major economic engine. Household names listed by Enterprise Florida, the state's public-private economic development entity, include Blue Origin, Boeing Space, Dassault Falcon, Embraer, Lockheed Martin, L3Harris, Northrup Grumman, and SpaceX. This scenario was far from certain in 2004, when the Space Shuttle program was ended.
The announced retirement of the Space Shuttle brought memories of the abrupt cancellation of the Apollo program in 1972, which spurred major job losses. Rather than repeat that scenario, a group of Brevard civic and government leaders collaborated to protect the local aerospace industry, according to Weatherman, who has headed the Space Coast EDC since 1994. Weatherman recruited Marshall Heard to help, drawing on his career experience with Boeing and his consultancy to the aerospace industry. The immediate prospect was NASA's next spacecraft, Orion, which was to take humans to the moon and eventually to Mars.
"We had what I call a stroke of inspiration," Heard said. "In the past, all manned space vehicles were assembled at the companies' home facilities . . . and shipped to Kennedy to be launched. We said, 'Why not build it at Kennedy?' When that idea occurred, it was like the light went on."
The group devised a business case that contended government costs could be lowered if Orion were built in Brevard. The team documented that local workers had the requisite skills and a history of accepting wages lower than demanded by peers elsewhere in the country, and identified local facilities where the spacecraft could be built. Lastly, the team secured state aid for the county's bid through an incentive package informed by the model of the state's successful 2004 bid for the facility that became the Herbert Wertheim UFScripps Institute for Biomedical Innovation & Technology.
Heard said the group pitched its proposal to NASA and the two leading contenders for the contract to serve as prime contractor to design, develop, test, evaluate, and build the nation's next spacecraft. When NASA announced the Lockheed Martin Corporation as winner of the $3.9 billion contract in 2006, the payoff for the Brevard effort was cited: "Lockheed Martin will . . . complete final assembly of the vehicle at the Kennedy Space Center, Fla."
Weatherman describes the deal as concrete validation of the county's resources and perseverance. "People don't fully recognize what Orion did for this community," she said. "It was proof that we had a second act. It was something for us to capture, and now it's being built here."
Small but supportive community accomplishes big things
Dana Kilborne has a unique perspective of Brevard's economic resilience. Kilborne has promoted the county through her civic service, including as past chair of the Space Coast EDC, as a former director of the Atlanta Fed's Jacksonville Branch, and as an advocate of Groundswell. A banker with more than 30 years' experience in Florida, she noted that the financial needs of county residents have reached the point that the bank she leads now offers trust services, which other banks previously serviced from offices in other counties. Kilborne serves as president and CEO of Cypress Bank and Trust, as CEO of Cypress Capital Group, and as a director of both companies.
Kilborne joined Bostic and his team on the tour of Groundswell, and later contemplated Brevard's trajectory of economic development. "This community, in general, is very supportive of others in many ways, not just business mentorship but philanthropic," she said. "The things we accomplish belie the size of our community."
David Pendered
Staff writer for Economy Matters