The $526.8 billion defense budget President Barack Obama signed Christmas week steers hundreds of millions of dollars to Puget Sound military installations and billions more for Boeing-made aircraft being developed here.
It also buys some peace of mind for Northwest defense contractors. The spending plan coupled with a two-year bipartisan budget deal adopted last month gives them the stability they’ve been missing in an era marked by repeated fiscal crises.
“The way everything fell, having greater certainty, having more dollars, it really is all just upside for national security as well as for the Northwest,” said Dave Hunt, executive director of the Pacific Northwest Defense Coalition, which represents small- and medium-size businesses.
The defense spending plan includes $153.1 million for projects at Joint Base Lewis-McChord, nearly all of which is to be used to build improvements for its expanded Army helicopter brigade.
Boeing picks up $3.2 billion to build the Navy’s P-8A Poseidon surveillance aircraft and $1.6 billion to continue developing the Air Force’s next refueling tanker, the KC-46A. Work on both projects takes place in the Puget Sound area.
Meanwhile, Naval Air Station Whidbey Island is to receive $85.2 million for facilities that would help it handle an expected fleet of 49 new Poseidon jets. The Poseidon is replacing the P-3 Orion maritime surveillance plane.
“The bill provides our men and women in uniform with the tools and resources they need to maintain national security,” said Rep. Adam Smith of Bellevue, the ranking Democrat on the House Armed Services Committee.
Spending on military contracts in the state swelled to more than $5 billion a year during the peak of the Iraq and Afghanistan wars, up from about $2 billion a year before the Iraq invasion in 2003.
Much of that money went for war-related contracts and to build up Lewis-McChord, which nearly doubled its force of active-duty soldiers between 2003 and 2010. The defense budget in 2011, for example, had nearly $300 million for construction at the base between Tacoma and Olympia for projects intended to help it accommodate its rapid growth.
Local defense contracts began climbing even higher in 2011 as the ground wars slowed and the Pentagon freed up more money for the P-8A and KC-46A contracts.
In the 2012 federal budget year, the Defense Department allocated $9 billion for work on military contracts in the Evergreen State. Last year, the Pentagon spent $7.7 billion for work with private companies in the state, according to records kept at the federal database usaspending.gov.
Boeing builds the submarine-hunting P-8A in Kansas and finishes it in Renton. The first P-8A squadrons are operating out of Naval Air Station Jacksonville in Florida.
Boeing in 2011 won a $35 billion contract to supply the Air Force with 179 KC-46A tankers. The first test aircraft are being built in Everett.
Some obstacles on the horizon could crimp local military spending.
The overall budget agreement negotiated by Sen. Patty Murray, D-Wash., and Rep. Paul Ryan, R-Wis., allocates less money for defense than the new military spending bill. The differences must be worked out in the months ahead.
And the Murray-Ryan budget deal restored some, but not all of the defense money lost to the forced federal spending cuts known as sequestration. Those cuts compelled furloughs for civilian employees at Lewis-McChord last summer and reduced training opportunities for military units.
“It’s hard to manage from a kind of a crisis standpoint,” said Lakewood Mayor Don Anderson, who regularly meets with Lewis-McChord leaders. “That comes out of the hide of the civilian force. That comes out of the hide of training.”
Funding remains tight at Lewis-McChord, but base Commander Col. Charles Hodges has told civilian employees recently that furloughs are off the table because of the budget agreement.
Two months ago, he told a meeting of South Sound local government leaders that sequestration coupled with an unclear budget picture coming from Congress had constrained the base command’s ability to spend money on anything other than public safety and emergencies.
About 16,000 civilians work at Lewis-McChord, either as government employees or as contractors.
The budget “takes some of the pressure off,” base spokesman Joe Piek said. “We’re still being very, very frugal in watching how we spend.”
Some Pacific Northwest Defense Coalition members had trouble projecting when they’d be able to bid for new work during October’s government shutdown. They’re looking forward to the stability they can see in the budget and defense bills.
“There will not be another government shutdown, at least for the foreseeable future,” Hunt said. “From a contractor standpoint, and for the men and women who are serving, that just makes life a whole lot better.”
The bill explicitly forbids another round of the Base Closure and Realignment Commission, which also promises stability for Washington’s Army, Air Force and Navy installations. That means Washington’s military bases are relatively safe from cuts even though the Armed Forces are downsizing.
The local projects funded in the defense bill are:
• $79 million for a new Army aircraft maintenance hanger at Lewis-McChord.
• $37 million for Army airfield improvements at Lewis-McChord.
• $28 million for an Army aviation headquarters at Lewis-McChord.
• $9.1 million to build a machine gun firing range at Lewis-McChord’s Yakima Training Center.
• $18.2 million for water-treatment improvements at Naval Base Kitsap.
• $25 million toward improvements at Naval Base Kitsap’s explosives handling wharf.
• $32.5 million for improvements to the EA-18G Growler facility at Naval Air Station Whidbey Island.
• $85.2 million for a P-8A Poseidon hangar and training facility at Whidbey Island.
• $10 million to replace a fuel pier at Whidbey Island.