Fate of McDonnell Douglas Contracts Uncertain : Aerospace: Reported government budget cuts on Space Station Freedom may jeopardize $23 million awarded to small business.

McDonnell Douglas Aerospace said Friday that it has awarded $23 million in contracts so far this fiscal year to small businesses as part of its work on Space Station Freedom.

But the fate of those contracts, including a minority-owned company in Ohio, was uncertain after reports this week that President Clinton would drastically slash the budget for the project. Vice President Al Gore reportedly has assured two lawmakers that no money would be cut from the project.

“With all of the noise that we are hearing on the Space Station, we don’t know what will happen,” said Raul Alvarado, a McDonnell Douglas senior staff specialist on the Space Station program. “If the funding is cut, their contract is cut. We don’t have anything to offer them.”

Four small companies in California have been selected so far, but not one is minority owned and none is in Orange County.

Since Oct. 1, the start of the government’s fiscal year, McDonnell Douglas Aerospace has selected eight small businesses for minor subcontracting projects--those valued at no more than $10 million.

“The big issue in the election was trying to get work to small businesses,” Alvarado said. “They are really the strength and the backbone to our society.”

The awards to the small businesses are expected to total about $50 million by year’s end, Alvarado said. McDonnell Douglas has about $602 million in its subcontracting budget for the Space Station through Sept. 30, he said.

The aerospace giant also has been gathering a database of minority- or women- owned small businesses to ensure that those firms are included in the selection process.

“We’re doing everything we can to try to locate these businesses,” Alvarado said. “The database is getting tremendous use now.”

So far, nearly 700 companies have been entered on the database. One minority-owned firm, Intek Corp. of Westerville, Ohio, was awarded a $2-million contract to produce ammonia flow meters for the project. These meters measure the amount of ammonia flowing through fluid lines and serve as a coolant in the Space Station. The contract expires in October, 1994.

Many firms look at the stringent design and durability requirements and never even bid on the project. The parts that go into the Space Station are expected to last 30 years.

“Just think about trying to find a car where nothing goes wrong with it for 30 years,” Alvarado said. “Often your local industry shop just won’t be able to do it. They won’t bid on it.”