2 Cities Offer to Spend $51 Million to Lure Jobs : High desert: Lancaster and Palmdale hope to land a defense finance center with up to 4,000 workers. The towns seek to offset lost aerospace positions.


Lancaster and Palmdale, jumping into a fierce nationwide competition to provide a home for a Defense Department finance center that will bring up to 4,000 jobs with it, offered Wednesday to spend $51 million on an office complex for the installation--more than either city's annual budget.

Representatives of both cities, who plan to fly to Washington this weekend to submit their proposal by Monday's federal deadline, said they desperately want the jobs to offset the loss in aerospace employment in the Antelope Valley in the past two years.

But the cities conceded their potentially costly offer is a long shot. Federal officials expect to get 100 to 200 proposals from throughout the country, including others from California. But they plan to establish only three to six such centers nationwide, each employing 4,000 or 7,000 people.

"We are expecting a great many proposals. . . . Somebody said it looks like feeding time in the shark tank out there," said Jean Marie Ward, a spokeswoman for the Defense Finance and Accounting Service, the Defense Department agency that is conducting the competition.

The centers are key to a plan by the Defense Department to close many of its approximately 600 smaller payroll offices throughout the country and consolidate them during the next several years into the new facilities, which are expected to employ about 20,000 people in all.

Those jobs at present are filled. But because many government employees might not want to relocate, Ward said, defense officials estimate that local hires would account for up to 80% of the jobs transferred to any new center, meaning there could be up to 16,000 new hires nationally.

Even to be considered by the federal agency, prospective host cities must offer the government at least 600,000 square feet of office space, related parking and other support services virtually for free. A list of recommended sites is scheduled to go to Congress and the President next spring.

Apart from Lancaster and Palmdale, other California governments already planning to submit proposals include the city and county of San Diego, the city of Sacramento, the city of Seaside near Fort Ord, and the communities around Castle, Norton and George Air Force bases, all slated for closure.

Lancaster City Manager Jim Gilley said the two Antelope Valley cities will offer to build office space for 4,000 federal workers on about 20 acres owned by Lancaster's Redevelopment Agency at the southeast corner of 27th Street West and Avenue I.

Lancaster has promised to pay $27 million and Palmdale has pledged $24 million to build the 600,000-square-foot center, which, at 10 stories, would be the tallest building in the Antelope Valley. Parking for 1,200 to 2,400 cars would be required.

To finance the $51-million project, which would cost more than either city's annual operating budget, Lancaster and Palmdale would have to commit virtually all of their available redevelopment funds for years to come. The funds are derived from increased taxes paid by owners of property in areas redeveloped by the cities.

But Gilley said the lure of the jobs justifies the investment.

The two cities' offer represents an unprecedented cooperative venture for communities better known for feuding over rival shopping mall and auto center projects. Even officials in other cities were surprised to hear that the two Antelope Valley cities were working together.

Their proposed site is part of a 125-acre parcel owned by Lancaster, which city officials have been trying to develop as a shopping mall for several years. Gilley said a federal facility would not preclude a mall, although its size would be limited.

The two Antelope Valley cities are already at a disadvantage because they learned of the federal competition only in recent weeks through a column in a local newspaper, and other cities have been developing their proposals since the original March 3 federal announcement.

Ward, the defense agency spokeswoman, said packages explaining the competition were delivered to all California congressional offices, as well as to congressional and governors' offices throughout the country in early March. But Antelope Valley officials said their representatives sent them no word of the competition.

In addition, the five cities that already are home to smaller Defense Department finance centers--Cleveland, Columbus, Denver, Indianapolis and Kansas City--appear to have a built-in advantage as sites for the expanded centers, since they would have lower relocation costs.

However, Ward said the Defense Department's main interest is in finding the lowest-cost facilities available in communities that meet the government's conditions, including an available work force, affordable housing, good schools, recreational opportunities and low crime rates.

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