Bonds' shaky support threatens Crane biz park: Region attempts to build on base's stay of execution

August 7, 2006

During his first months in office, Gov. Mitch Daniels' top priority was engineering a stay of execution for the Crane Naval Surface Warfare Center, 90 miles southwest of Indianapolis. Losing its 5,200 employees and contractors would have been a devastating blow to the region.

Daniels' lobbying effort in Washington, D.C., was so successful that the Association of Defense Communities last month recognized him as "2006 Public Official of the Year." But troubles with local financing for a new business park on the outskirts of Crane threaten to set back the progress.

Leaders in Greene, Daviess and Martin Counties have been attempting to build the West Gate at Crane park so that private companies can leverage the base's capacity as a high-tech engineering hub. Thanks to bonds underwritten by Daviess County, they've already broken ground on a building for the first tenant, Gaithersburg, Md.-based defense contractor EG&G. The project is expected to bring 70 jobs. Last month the Crane Federal Credit Union announced plans to move its headquarters there, too.

But Martin County residents aren't sure they want to underwrite construction of two more buildings in the park, both slated for lease by San Diego-based Science Applications International Corp. The debate has already run across two public meetings. On Aug. 7, the Martin County Council will meet to consider whether to authorize a $4.5 million bond issue. Some Martin County officials have questioned whether SAIC, an enormous defense contractor, needs assistance from local taxpayers.

"This is a big deal for Martin County to take on a project of this size and magnitude. People are taking their time and being very deliberative about it," said Martin County Economic Development Director Jerry Ott. "If the bond issue fails, it certainly causes lots of difficulties and problems for the project. We don't even like to think or talk about that."

If West Gate at Crane can successfully land SAIC, it stands to gain 100 jobs immediately and even more over time, Ott said. If approved, the bonds would be repaid from taxes raised through a local tax-increment financing district and from an economic-development tax Martin County has levied against personal incomes.

SAIC's jobs are just the kind economically depressed southern Indiana needs, Ott said.

"It'd be huge, particularly with the average wages they're talking about in the neighborhood of $45,000 per person," he said.

Mike Gentile, executive director of Southern Indiana Business Alliance Inc., expects the bond issue to pass. Now that the Crane base's future has been secured, he said, it's been much easier to attract business interest in the West Gate park.

"I think the focus has changed from saving the base to growing the base, and the tech park is an integral part of that," Gentile said. "Momentum is building up."

The Daniels administration hasn't lost sight of the project. It's seeking a consultant to prepare an economic development plan for the region around Crane. According to a request for proposals from the Indiana Economic Development Corp., Crane's scientific expertise is ready and available for private-sector companies.

Ultimately, officials hope to diversify the region's economy beyond Crane and its direct defense contractors. The base's engineers are trained to assist with university research and development, and technology transfer to private firms.

"The goal of this analysis is to lay the foundation for an economic diversification plan for this region that will result in an orderly transition from economic dependence upon defense spending to a more balanced mix of private and public sector employment," the RFP read.

For southwest Indiana, West Gate's success is crucial. The Crane base has twice before been slated for closure. One day, the military will reconfigure its assets again. When that time comes, Ott said, landlocked Indiana will need to show Crane's mission is still vital to the Navy and its contractors.

Increasing Crane's business ties could improve its odds to remain open. The base's primary mission is to develop new high-tech weapons systems. Such systems often have their origins in the private sector.

And next time, the governor might not be able to lobby another stay of execution.

"There will be other studies that will happen, and Crane will have to stand that muster again" Ott said. "The tech park won't be the sole answer for that issue. But it's one of the many pieces of the puzzle we're trying to put in place to ensure that Navy base continues to be here."
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