The Business of Base Closures
Passions were stirred earlier this summer when the Pentagon unveiled plans to shut down as many as 150 military bases over the next six years. Communities across America have long prized and defended bases, for reasons that typically have as much to do with local economics as with patriotism. Now an intensive lobbying effort is under way in states from South Dakota to California to Connecticut to save bases from closure.
A look at communities that were hard hit by the last round of cuts in the early 1990s suggests that not every base closing is bad economic news, however. The Government Accounting Office reports that fully half of the communities affected by past closures have seen per capita income growth in recent years. And 72% of all jobs lost as a result of the last four rounds of base closings have been replaced.
Not surprisingly, communities with bases near populous urban centers have fared the best. The former Alameda Naval Air Station near San Francisco is a case in point. The 1,500-acre site has been transformed into the home of dozens of businesses since the Pentagon pulled out 10 years ago. Alameda's shutdown was "a unique opportunity," says David Walsh, co-founder of Bladium Sports & Fitness Club, one tenant of the former base. "It gave start-ups access to facilities they never could have afforded at great prices."
Other places haven't fared as well. Carroll County, Ill., which borders Iowa, became a ghost town when the Pentagon shuttered the local Army ordnance depot. "When they closed the base, they took 1,500 customers with them that won't be replaced," says Dennis Bowman, who owns a Radio Shack and a movie theater in town.
Still, says Stephen Moffitt, a consultant who advises local officials on base closures, the infrastructure on these sites makes them "gold to the right communities." Of the bases currently eyed for closure, the one that most appeals to private investors is in Fort Monmouth, N.J., just 50 miles from Manhattan. Local developers are said to be lining up to convert it to housing.