Because, without the legislation being offered, the potential liability is essentially unlimited, and forever. The general aviation industry was plagued and almost destroyed by excessive liability. This was partially fixed by a law in the late 1990s (IIRC) removing the 'long tail' liability.
As an example from when I was living in CA back in the 1980s, a pilot forgot to put gas in his 35 year old Cessna, took off and crashed into a house about a mile from the airport. The homeowner was killed (along with the pilot). In addition to the pilot's estate, the homeowner's estate sued the manufacturer of every part in the airplane for negligence. One company, a builder of starters or generators (I forget which) spent $2 million in 1980s money in legal fees, proving that their generator was not even on the plane! That company then ceased building any parts for airplanes, as their gross sales for those parts was only a few $million per year and insurance costs would have been higher than the manufacturing cost.
Not much later Cessna ceased building general aviation planes (except for the Citation jets), and said that they would start again once the liability laws were fixed.
The 'long tail' law basically put a cap of (IIRC) 20 years on defective part liability for manufacturers. The basic idea is that if a part has lasted 20 years, it's probably not defective in any rational sense. Once this law passed, I think Cessna did in fact resume low levels of production.
Rockets are going to be considered 'fun rides for elite snobs with too much money' even more than airplanes. So, bottom line - without some legislation, in the event of a crash, a falling part, or a loud noise as it flies over, the trial lawyers would be able to sue the Spaceport and Virgin Galactic and everyone who ever mentioned the word 'rocket', on behalf of every individual in the state, whether or not they had even heard or seen anything or even knew something was flying that day. There are already federal and state laws (for the states that do a lot of space activities) limiting liability for commercial space launches. This legislation would do the same for New Mexico. Without it, NM will not ever be a space-business state.
Source: http://rss.slashdot.org/~r/Slashdot/slashdotScience/~3/VWLXmsTa4h4/story01.htm
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