By Jessica De Vault
NYT Institute

The dimly lit seafood restaurant sits across the street from the Naval Support Activity base. At Jack Dempsey’s, the customers, military and civilian, relax and have a satisfying helping of fried catfish. The base, which has been recommended for closing under the Pentagon plan, may not be open in two years, but Dempsey’s isn’t going anywhere.

Dempsey’s manager, Sammy Biamonte, said he would lose customers if the base closes. “It’ll affect us some 10 to 20 percent, but it’s going to happen eventually,” he said.

Lenise Foster, a local patron, said the base closing would be an inconvenience.

“My husband is retired, and we do a lot of things there,” she said. “But we can adjust.”

Adjustment is the way of life for many military personnel, Capt. Kevin McCarthy said. “We transfer throughout our careers, but many communities have thrived post-BRAC.”

The Base Realignment and Closure commission became the bearer of bad news on May 13 when it announced the Naval Support Activity was one of 33 bases on the closure list. The news upset New Orleans officials since the city relies heavily on the base, which employs 2,711 people.

At least 1,400 jobs would transfer to the larger Belle Chasse Naval Air Station in New Orleans, which is not slated for closure, but officials fear the blow from other jobs lost will be great if the Pentagon carries out its plan to close Naval Support Activity.

The city could lose another 8,000 jobs because of proposed downsizing of two major employers, Michoud Facility and Northrop Grumman Avondale Shipyard, according to figures from lawmakers and a NASA consultant.

“Worst-case scenario, you would have a dramatic job loss in the city or the area,” said Lee C. Reid, an attorney who consults with NASA on the Michoud facility. “It would be a real devastating case.”

Local and state officials have vowed to fight to keep the Naval Support Activity installation open, despite the Department of Defense’s closing recommendation.

“This recommendation is not the end of the BRAC process, but still very much a beginning,” said U.S. Sen. Mary Landrieu in a statement.

A group of politicians, including Landrieu and Sen. David Vitter, as well as representatives from various organizations, have drafted a proposal that calls for the restructuring of the base into a federal city. If the realignment and closure commission decides to shut the century-old naval base, the state is prepared to push the proposal.

Gov. Kathleen Blanco has pledged $100 million to fund the federal city initiative, Michael Olivier, Louisiana’s economic development secretary, said in a statement.

“This investment will provide the federal government with substantial cost savings,” Olivier said, although he did not specify how much the savings might be.

Blanco has also pledged an extra $65 million for low-cost housing near the military base.

Established in 1901 as an Army base, the Naval Support Activity once served as a naval vessel repair site and provided housing for transient personnel. In 1996, the Army base was transferred to the Navy, and the site was called Naval Support Activity. It now houses offices for the Naval and Marine Corp Reserves and 40 other commands.

Naval Support Activity, as other bases, was targeted for closing because it served no tactical purpose in the fight against terrorism, U.S. Defense Department officials said.

Louisiana officials said they were expecting the closing recommendation and were preparing to respond. They drafted the federal city initiative, which would re-structure the base to support units for the Army, Navy Reserves and Coast Guard. The facility would have state-of-the-art equipment and possibly a regional Homeland Security headquarters.

David M. Brasington, a Louisiana State University economist, confirmed that the federal city plan could be a reasonable idea, and that some base closings have reportedly proved to be beneficial.

It “turned out to be a blessing in disguise, and they did better with the base closings than before,” Brasington said in reference to a base closing in Pennsylvania in the late 1990s.

Brasington said the closings should be kept in perspective.

“They probably aren’t going to be a good thing,” Brasington said. “But it’s easy to overstate the negative.”

There is life after realignment, and in some cases a base closure can be something that breeds other opportunities for the community. At the England Air Force Base, the realignment commission decided to shutter the base in 1991. City officials, afraid of losing jobs, took the initiative to restructure the base. As a result, an airpark, community and home to 50 other businesses, emerged from the ruins of the closed base. In 12 years, the base has produced millions of dollars, and employs over 1,000 people.

Despite the optimism, the job losses at the base, Michoud and Northrop Grumman would still be inevitable.

Reid, whose firm is a consultant for NASA, said the downsizing at Michoud is a complicated issue that deserves attention from the city and state.
Michoud currently manufactures the external tank essential for launching space shuttles, which will be phased out by NASA by 2010. With no external tank to create, Michoud would lose an entire production line and an estimated 2,000 of its 2,083 workers, Reid said.

Navy cutbacks of Northrop Grumman Avondale Shipyard also loom, with the possibility of 6,000 jobs on the line, Landrieu said in an Associated Press article.

John Caldwell, the manager of business retention and expansion at the Greater New Orleans Inc., said when a shipyard works for the U.S. military, it’s at the mercy of Washington. The Navy recommended that the shipyard cuts the number of ships it manufactures from 12 to nine — which could cost roughly 900 jobs, Landrieu said in the AP article.

“When they cut ships, that’s going to affect some of the hiring that goes on,” Caldwell said. “It’s an unfortunate thing.”

Economist Milton “Dek” Terrell of SU said New Orleans’ economic outlook is bleak.

According to the Federal Deposit Insurance Corp., New Orleans’ employment rate has only grown a little under 1 percent in the past year.

“When you put all of those things together, it’s certainly going to have a negative impact,” Terrell said.

According to Reid, it’s highly unlikely that all three economic threats would occur at once.

“The city and state officials are addressing both problems head on,” Reid said. “When we do (this) in Louisiana we tend to succeed.”