Legislation Proposed to Help Cities Hurt by Defense Cuts

Citing plans by Lockheed Corp. to shift major operations from Southern California to Georgia, Rep. Barbara Boxer (D-Greenbrae) introduced legislation Monday to require defense contractors and the federal government to provide financial support to communities targeted for cutbacks.

The bill, co-sponsored by Rep. Howard L. Berman (D-Panorama City), would require defense firms to contribute 20% of the value of transferred contracts to the communities from which the work is shifted. The legislation would exclude companies transferring work because of cancellations of defense programs by the government.

The proposed law, the community economic adjustment fund act of 1990, also would give communities federal money amounting to 10% of the value of canceled government defense contracts.

Under either provision of Boxer’s bill, the money would be allocated by the Secretary of Labor and would fund jobs for displaced defense workers in community programs such as recreation, drug education and law enforcement. Boxer talked about her bill at a joint hearing in Paramount conducted by two House subcommittees to discuss community adjustment to defense spending cuts.

“If they decide to shift work for other than a (contract) cancellation, we’re saying that’s not fair to the loyal work force who supported the community,” Boxer said. “We’re saying there ought to be some corporate responsibility. They have an obligation that they don’t leave behind a lot of dead bodies and ghost towns.”

The legislation, which underscores growing concerns about defense cuts on the California economy, is in response to moves such as Lockheed’s announcement in May that it will transfer the headquarters of its Aeronautical Systems Co. from Burbank to Marietta, Ga., and scrap plans for a $75-million expansion of its Palmdale facility.

It also addresses planned cutbacks by McDonnell Douglas Corp., which announced last week that it would lay off 8,000 employees at its Douglas Aircraft subsidiary in Long Beach and 400 at its Space Systems division in Huntington Beach as part of efforts to reduce its overall work force by 17,000.

Responding to the proposed legislation, Lockheed spokesman Scott Hallman defended his company’s actions and criticized language in a Boxer press release that described defense contractors as abandoning communities.

“We don’t see it as abandoning Burbank,” Hallman said. “It was an economic decision on Lockheed’s part. That decision was made because of decreased defense spending, because we could not support two aircraft production facilities economically.”

A McDonnell Douglas spokeswoman said, “It would seem to exacerbate the problems facing contractors. It might force additional layoffs.” She declined to elaborate.