JFCOM fallout debatable
Published 9:46 pm Saturday, May 26, 2012
Eight months on from the disestablishment of the U.S. Joint Forces Command in North Suffolk, views differ among insiders about the impact on its former civilian contractors and small businesses.
When the facility at Harbour View was disestablished on Aug. 31, 2011, most former functions and personnel transferred to the Joint Staff, a new facility in its place, Joint Staff spokeswoman Kathleen Jabs stated in an email.
“Joint Staff Hampton Roads has a workforce of roughly 1,200 military and government civilian personnel with approximately 700 to 800 contractors,” Jabs stated.
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“Neither U.S. Joint Forces Command nor the Joint Staff have terminated any contracts prematurely. We have no way of knowing whether contractors who worked at JFCOM were assigned to other jobs within their companies.”
The Department of Defense can terminate contracts without cause, and attorney Terry Murphy, Government Contracts and Construction Practice Group chair at Kaufman Canoles, said the practice has not resulted from disestablishment.
But the DoD has scaled back some contractor activity by refraining from issuing delivery orders in multi-award contracts, he said.
Murphy believes it is too early to accurately gauge any impact on contractors who dealt with JFCOM. “I don’t think enough time has passed to assess the full impact on contractors,” he said.
“I think we all know the number of contractors is down, but certainly the Joint Forces Command is still operating under the Joint Staff and still operates service contracts, and we know that the Joint Staff services the Fleet Logistics Center in Philadelphia, and our understanding is they’re trying to maintain similar business goals.”
He said more civilian federal government agencies are currently putting out contracts, and the DoD should soon start issuing more solicitations.
But, he said, it takes months after the issuing of a solicitation for a contract to be awarded. “Programs are building back up, but it’s a slow process,” he said.
From another perspective, government contract proposal writer Butch Bondoc, of Portsmouth-based Federal Capture Consulting, reports much greater fallout.
“In the backend of Harbour View, there are all kinds of buildings that are now vacant,” he said. “They were branch offices or companies, large and small … (but) a lot of smaller company offices are now empty, closed.”
A field trip to “the backend of Harbour View” is unable to confirm this scenario: the presence of better-known contractors such Lockheed Martin, General Dynamics, Mitre and Exelis is clear, but whether smaller companies have fled is harder to discern from the rows of heavily tinted business unit windows.
Bondoc said the DoD concentrated on saving government civilian jobs, “but as far as the 3,000 contractors’ jobs, those all went away.”
He said stories of companies and people affected are heard at the Tidewater Association of Service Contractors’ monthly luncheon meetings at the Norfolk Airport Hilton.
Suffolk Department of Economic Development Director Kevin Hughes said the workforce transition and business development center set up at Harbour View last May to help deal with the JFCOM disestablishment has had 1,800 visits.
Factoring in repeat visits, he estimated that “a little over 1,000 people” have accessed the center, whose funding is due to expire in December.
“Generally speaking, the impact has been — relatively speaking — minimal,” he said. “Looking at some of the office developments, you have had some office vacancies open up directly related to defense.
“If you were to look at the retail side, that has been a smaller impact. A lot of that’s just due to the population growth in Suffolk, and specifically North Suffolk.”
Many people who have accessed the center have remained with their companies, he said. “Folks might receive that notice from the company that a contract’s expiring, so they start looking at what’s the next step; but at the same time their company (may retain them).”
Meanwhile, the Pentagon cannot say how automatic cuts to its $531 billion budget of $50 billion per year for 10 years — so-called sequestration — could impact the prospects of North Suffolk defense contractors, spokeswoman Elizabeth Robbins stated in an email.
Sequestration would reportedly take effect if lawmakers in Washington don’t reach a deal to reduce the federal deficit by January.
“We do know that sequestration will amount to what Secretary Panetta has called ‘a meat-ax approach’ of cutting at least eight percent more from each defense budget category,” Robbins stated.
According to Murphy, the Navy is moving NETWARCOM and the 10th Fleet Cybercommand to North Suffolk, the former from Little Creek due to overcrowding.