Every region of the country can point to a former military facility that is now home to more private sector jobs than were ever created under military control.
The transformation of former military bases into places for business growth is one of the least-publicized stories of the 1990s and the first half of this decade.
Locating or expanding into a former military installation may not make sense for your particular business. However, it’s an option you should at least consider when going through a growth project.
Explaining why former military facilities are popular with companies is easy when you look at four key business essentials: infrastructure, investment, incentives and individuals.
Infrastructure
In some locations around the country, the difficulties associated with just getting a piece of land may be enough to deter a business from growing. Former military bases not only have land but often have a full-size runway. Many are also near major highways, waterways or rail lines.
In California, DHL Danzas Air & Ocean and The Pasha Group announced recently that they would open a distribution facility at the Southern California Logistics Airport in Victorville, formerly George Air Force Base. The Pasha Group will serve as the third-party logistics provider for Go Video, a discount consumer electronics chain.
Ready access to air, highway and rail transportation was a key factor in the selection of SCLA.
“We are investing in Southern California Logistics Airport as the solution to a severely congested supply chain,” said Don McKnight, president of The Pasha Distribution Group. “While Go-Video’s logistics operation gains time and cost benefits by locating closer to its customers, it will benefit even more when the rail line gets connected directly into SCLA.”
Investment
Former military installations offer lots of natural advantages for expanding and relocating companies, but they all weren’t ready for business as soon as the Army or Air Force turned out the lights and locked the doors.
More than $1 billion in federal and local funds has been pumped into former bases in order to make them viable for business.
Roads were built or repaired. Building were restored or torn down. Contaminated land was brought into compliance with Environmental Protection Agency regulations.
In Jacksonville, Fla., a group of local organizations worked together to turn the former Cecil Field into the Cecil Commerce Center.
The city of Jacksonville, the Jacksonville Electric Authority and the Jacksonville Airport Authority have modernized buildings, and upgraded roads and infrastructure since Cecil Field closed in 1999.
The result is that businesses like LSI, Boeing, NADEP and others now employ more than 1,500 people at the site.
Incentives
If locating at a former military base makes sense from a business standpoint without any incentives, then taking advantage of what state and local governments are offering can improve your bottom line.
If you locate your company into a former military facility, you could be eligible for a variety of federal and local incentives.
For example, look at the variety of incentives potentially available at KellyUSA, formerly Kelly Air Force Base, near San Antonio, Texas. A partial list of incentives at Kelly includes:
Defense Economic Readjustment Zone (DERZ): Benefits include sales tax refunds and a discount on the state franchise tax.
Work Opportunity Tax Credit: A federal tax credit to reduce the federal tax liability of private companies. Firms must be for-profit and can hire people from eight different targeted groups.
On the Job and Customized Training: Businesses are reimbursed for part of employees’ wages during training.
Skills Development Fund: Through partnerships with local junior colleges and universities, businesses can obtain financing for specialized training required on the job site.
Individuals
While incentives and a terrific infrastructure are important factors to consider when expanding or relocating your business, no company can succeed without a skilled, competent, reliable work force.
And skilled, educated workers are often in abundant supply near a former military installation.
The Utah Industrial Depot near Tooele, Utah, is a good example. The U.S. Army closed the Tooele Army Depot North Area truck refurbishing facility in 1995. Left behind were more than 1,000 civilian workers with good skills but no jobs.
Today, the Utah Industrial Depot is home to nearly 50 companies that employ nearly 1,000 workers.
When the Army left Tooele, many people who had worked at the depot were forced to take work in Provo or Salt Lake City, said Mark Smith, asset manager for the Utah Industrial Depot. Many of those same people have now come back to work for companies in the complex.
Means the article is accessible only to our magazine subscribers.
