Why are states spending local tax money on military bases?

Military
by Michael Cochrane
Posted 12/14/15, 08:45 am

With the Pentagon struggling to maintain the aging infrastructure at many military bases, state and local governments are increasingly stepping into the breech to fund construction and repair projects at U.S. military installations—expenditures they consider investments in economic development.

Shrinking defense construction and maintenance budgets and aging infrastructure are putting pressure on the Pentagon to ask Congress to close many U.S. military bases. But just as they might spend money or provide tax concessions to prevent a major corporation from closing shop, states are using similar tactics to protect their military bases and the revenue they provide.

“We are changing the ways we think about military bases,” said Bob Ross, executive director of Connecticut’s Office of Military Affairs. “These are big commercial enterprises. They are publicly financed, but there is so much commercial activity that goes on at these bases, you have to look at them the same way you look at a corporation.”

Connecticut—which authorized $40 million to improve aging infrastructure at the naval submarine base there—is one of almost two dozen states with a major military presence, more than half of which have spent state money on the facilities, according to the Association of Defense Communities.

Both the number of states funding military base construction as well as the scale of the projects involved has increased steadily over the past five years, according to the association. Although many of the projects come in at about $5 million or less, several are quite large: Oklahoma ponied up $28 million to improve railroad and hangar facilities at Tinker Air Force Base and Louisiana’s share of the new Marine Corps Forces Reserve headquarters in New Orleans was $150 million.

Most bases are a community’s—and in some cases, even a state’s—largest employer, said Tim Ford, the association’s chief executive officer. Bases create a vibrant economy and tax base by infusing capital into a local area through salaries, expenditures, and contracts, he added.

But Ford also noted this raises the question of how far states should go in providing money for federal installations.

“Where’s the point by which you have to draw a line, where this is a federal action?” he said. “How much should states really invest?”

Some defense policy analysts believe states are wasting their money funding federal projects that won’t be enough to change minds in a future round of base closings.

“States should spend money investing in the local community, in health and public safety, and what money they don’t need should return to their people in the form of lower taxes,” said Jerry Hendrix, a retired Navy captain and director of the Defense Strategies and Assessments Program at the Center for a New American Security, a Washington think tank. 

Without the political will to close bases now, said Hendrix, states are spending money to “compete in a competition that hasn’t been declared.”

But many states are willing to take the risk in a bid to stave off a base closure.

“The No. 1 criterion for maintaining a base, instead of closing it or realigning it, is military value,” said Dennis McGinn, assistant secretary of the Navy for installations, during a visit to the submarine base in Groton, Conn., where he helped open a new facility for Navy divers, referred to as a dive locker, the state helped fund.

The Groton base was nearly shut down during the 2005 round of base closures, chiefly because of its aging infrastructure. Connecticut’s $4.7 million investment in the new dive locker paid off by increasing the base’s value to the Navy.

“The military value of the naval submarine base is enhanced by having, in this particular case, a dive locker,” McGinn said.

The Associated Press contributed to this report.

Michael Cochrane

Michael is a retired Defense Department engineer and former Army officer who is an adjunct professor of engineering management at Old Dominion University in Norfolk, Va. He is a graduate of the World Journalism Institute's mid-career course. Follow Michael on Twitter @MFCochrane.

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