The expected passage of a $288.8 billion defense bill for fiscal 2000 – representing the largest peacetime defense buildup since the Reagan era – will mean a continued revenue stream for several small businesses in Rhode Island. With bipartisan support on Capitol Hill, the defense package is $8 billion more than President Clinton had initially requested.
Expected to be signed into law by President Clinton, the spending plan represents a huge boost for the area’s major defense contractors, including General Dynamics/Electric Boat, Raytheon and Textron.
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The dramatic increase in federal defense spending also underscores a commitment to both the Naval Undersea Warfare Center in Newport and the Rhode Island Air National Guard.
At Providence-based Textron, for example, the company’s fiscal year 2000 budget already reflects a move toward more military spending. It includes $867.4 million for 10 V-22s to be built by the company’s Bell Helicopter and Boeing divisions. The V-22s will be used by the United States Marine Corps to transport Marines into combat. The aircraft take off and land like helicopters, but fly like turbo-props, according to a Textron spokesperson.
At Textron Systems in Wilmington, Mass., the government plans to spend $61.3 million for a series of Sensor Fused Weapons, “smart weapons” that are directed by infrared guidance devices.
The resurgence in defense spending is especially satisfying to Rhode Island’s Congressional delegation. U.S. Sen. Jack Reed, a new member of the Senate Armed Services Committee that produced the spending package, said the Rhode Island delegation has been working hard to sustain defense spending for years.
”We have full-time, day-to-day involvement in these issues,” Reed said. “We’ve got unique advantages in Rhode Island, including a tremendously skilled workforce.”
Those day-to-day efforts at the Capitol are now paying off back home, not only for the big submarine and missile-systems builders, but for the smaller players.
One such company is Insyte Business Systems Inc, in Exeter. Insyte has been in business since February 1998. The company, which has five employees, provides networking and computer support to defense companies.
Owner Sherry Jamieson said when a local base is impacted, her company is, as well.
In the case of defense cutbacks, Jamieson said she would “lose some business and momentum.”
Fortunately, for Insyte, that has not been the case.
”In any business, there is the risk that you could experience a drop-off,” said Jamieson. “But we’ve been fortunate to only have experienced growth.”
Mike Lopes, is the owner and president of DRACO Engineering, Inc., a systems engineering and production company based in Portsmouth. DRACO employs a total of about 40 people. Much of the company’s work centers around high-tech weapon design, including the development of commercial-off-the-shelf (COTS) based computer systems for military and industrial applications.
Lopes started DRACO in 1986, but has been in the same kind of business since the early 1960s. He has learned that defense spending is cyclical.
”We build down so far, now a lot of people are realizing – including the President – that we are running out of bullets in Kosovo, that we are using spare parts,” said Lopes. “You can only hit those budgets for so long.”
Among the projects authorized by the Department of Defense spending plan that will have a direct impact in Rhode Island are:
$17.7 million for a hangar for the Rhode Island Air National Guard for new C-130s to be delivered in 2001.
$13 million for Trident submarine conversion designed by Electric Boat.
An additional $26.4 million for Advance Amphibious Assault Vehicles manufactured by General Dynamics. Quonset Point may be the manufacture site of the vehicles.
$18 million for counter mine systems used by the Navy and manufactured by Raytheon.
$30 million for Volume Search Radar manufactured by Raytheon.
