BASE—Air Force Wants City to Help Pay for Base Renovations

0

Faced with a declining budget and outdated buildings at its El Segundo base, Air Force officials are seeking as much as $40 million in local government subsidies to help pay for a new $85 million research-and-development facility there. Leaders in the area worry that if the plan fails, the base could become a prime target for closure, meaning much of its $5.5 billion in annual contracts would be lost to the South Bay economy. Despite those fears, officials in El Segundo, with a population just over 16,000 and an employment base of 80,000 workers, can’t afford to pony up the money on its own. “To ask our small city to shoulder the burden itself presents fundamental questions of equity, and fundamental questions of feasibility,” Councilman Kelly McDowell said. “It’s a little strange for me to see the federal government, which is running a surplus, come into little old El Segundo asking for money on this land deal.”

Though El Segundo intends to do whatever it can to keep the base, the money being sought could exceed the city’s annual budget of $36 million, according to McDowell. As a result, keeping the Air Force base around will likely mean going to other cities and agencies for help. “Everything doesn’t flow out of the Air Force base into El Segundo,” McDowell said. “It flows into the region. Just as I think we should only be part of solving the problem, I think we only get part of the benefits.”

Under the plan, the Air Force wouldn’t use any money of its own to pay for upgrading its base. A private-sector developer would be brought in to build a new 750,000-square-foot R & D; facility on a 54-acre portion of the 96-acre base property. In exchange, the Air Force would offer up the remaining 42 acres as compensation to the developer, who would then be free to develop the choice parcel. In addition, the Air Force would give the developer 13 acres in Hawthorne and 3.7 acres in Sun Valley. “The idea primarily is to really try to do this at no (cash) cost to the (federal) government,” said base spokesman John Ryan. A total of 4,970 people are employed on-site at the base, including 3,486 civilians. Its R & D; projects include satellite surveillance equipment that received high-profile use in military conflicts like the Gulf War.

Federal officials said legislation needed to pave the way for the deal could pass by October, which would allow the Air Force to start selecting a developer. Moving quickly, Air Force officials hope to have all proposals from interested developers in hand by spring 2001.

King’s ransom

El Segundo city policymakers plan to discuss possible ways to finance the deal on Sept. 5. Among the likely topics of discussion will be the feasibility of asking neighboring cities, along with county and state officials, for help. Suggestions on the table include creating a city redevelopment agency to oversee the project, launching an assessment district or approving bonds.

If the plan comes together, El Segundo could gain more than other cities. The 42 acres earmarked to go to the developer is slated to become hotels, office and industrial space, which would provide a tax boon to the city.

“It all really comes down to the type of project that they’re going to end up building how much money they’re really going to spend on the new Air Force facility, against what kind of revenue stream can be created from the development,” said Jim Hansen, director of El Segundo’s Community Economic and Development Services Department.

Bill Crigger, president of the El Segundo Chamber of Commerce, expects the prospect of using local tax dollars to upgrade the federal military base to be a touchy matter. But the cost of losing the base to closure would be even greater, he said.

“It’s hard to imagine a point at which it would be acceptable to us that the Air Force would leave,” Crigger said. “That’s the only statement I can make. It’s so important to so many of our businesses in terms of the employment it generates, the quality of jobs, and the amount of money it drives through our local economy.”

Prime jobs

If the base were to shut down, the impact would differ in several ways from the hemorrhage the California aerospace industry suffered during the past decade, said Winton Churchill, president of the South Bay Association of Chambers of Commerce.

“A lot of what left here was what I called the metal-benders, the sheet-metal-rivet type jobs and the production planning and the manufacturing planning,” Churchill said. “In my opinion, the jobs that this facility represents are at the very top of the food chain. They are the tech jobs, the software developers, the program managers, the miniaturized electronics developers. They’re seen as the keepers of the flame of expertise.”

Churchill believes Los Angeles Air Force Base is a likely candidate to be closed. That’s because it has no runways or planes that make its operations difficult to relocate. Its facilities are old, ill-suited for many of today’s high-tech uses, and expensive to maintain.

Consolidating operations now done at the base with work performed at a newer, modern facility elsewhere in the country would seem to be a tempting option for the military.

Rep. Steven Kuykendall, R-Torrance, who sponsored the House of Representatives version of the bill clearing the way for the local financing plan, said that shrinking military spending makes it necessary to come up with new approaches to update facilities.

“The aerospace-industry core of the South Bay economy revolves around the Los Angeles Air Force Base,” Kuykendall said. “Renovating and updating this base for the 21st century is critical to the local economy.”

Asked if business leaders are right to worry that the future of the facility in El Segundo would be less secure if the deal does not come together, base spokesman Ryan said, “I would say they’re right on track with that.”

No posts to display