Northern Virginia faces big hit from Gates' contractor cut, tech council says
The Northern Virginia Technology Council is sounding the alarm about the possible impact of a Defense Department decision to cut the military contracting budget 10 percent a year for the next three years.
NVTC President and CEO Bobbie Kilberg said Wednesday the effects of the cut on Northern Virginia, which is thick with technology companies that hold defense contracts, could be "quite devastating."
Most of the reaction from the state's political leadership since Defense Secretary Robert Gates announced his plan to slow the growth of his budget has focused on Gates' announcement of the closure of the Joint Forces Command in Hampton Roads. More than 5,000 jobs in Norfolk and Suffolk could be lost from the closure.
But the contracting cut could be just as significant for the Washington area, long the state's economic engine. Kilberg estimated that 65 to 70 percent of NVTC's member companies--which include businesses that range from contracting behemoths to small scale operations--hold a defense, homeland security or intelligence contract.
Stock prices of defense contractors took an immediate hit after the announcement; Kilberg said NVTC's members have been "buzzing" about the possible impact on their bottom lines.
"I think when you take a look at the imapct on our Northern Virginia economy and on the economy of all of Virginia, it is really very serious," she said.
Tucker Martin, spokesman for Gov. Bob McDonnell (R), said the govenor is "very concerned" about the Northern Virginia impact of the contracting cut.
And U.S. Rep. Gerry Connolly (D-Va.) appeared on Washington's Fox News affiliate this morning and said Northern Virginia could be "profoundly affected" by the cut. Watch the interview here:
Rosalind S. Helderman
August 11, 2010; 5:07 PM ET
Categories: Gerald E. Connolly , Robert F. McDonnell , Rosalind Helderman
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