Maryland Loaded with Federal Defense Dollars

By DANIELLE ULMAN, Capital News Service

WASHINGTON - The Department of Defense spent more than $15 billion in Maryland in fiscal year 2005, ranking it in the top five states nationally, according to census figures released Tuesday.

The amount is consistent with previous expenditures a government official said.

"It tends to be even and predictable because the defense work in Maryland doesn't have the peaks and valleys of other states," said Mike Hayes, managing director of military and federal affairs at Maryland's Department of Business and Economic Development.

The state's Defense funding came about largely through procurement contracts, which totaled $10.8 billion, according to the Consolidated Federal Funds Report for Fiscal Year 2005 released by the census Tuesday. California, Virginia, Texas and Florida were the other top recipients of Defense spending.

Maryland also ranked third in per capita federal spending for 2005. The state's population is about 5.3 million and federal spending was $66.7 billion.

"I think Maryland's always had a strong relationship with the federal government due to our proximity. Some of the country's top research institutions and high-tech military installations are here - Fort Detrick, Aberdeen Proving Ground, (Patuxent River Naval Air Station) and Andrews Air Force Base," said Joseph Shapiro, spokesman for the Maryland Comptroller's Office.

"I mean we run the whole gamut in the area," he said.

NASA's Goddard Space Flight Center in Greenbelt and the Naval Air Warfare Center Aircraft Division at Patuxent River were among the top five contracting offices in Maryland, according to the 2005 federal procurement report. Each contracted for more than $1 billion with the Department of Defense.

Defense spending increased by 10 percent in Maryland from 2004 to 2005, but officials said spending will swell as the state absorbs more people and military contractors from the base realignment process.

At least 17,000 people are expected to move to the state with the addition of more than 15,000 net jobs from the base realignment process, according to the Maryland Department of Business and Economic Development. The state could eventually add more than 40,000 jobs related to the Defense moves.

"Defense spending in Maryland is going to grow exponentially as we approach 2011," Hayes said.

That's the year the bulk of people coming to the state from the base realignment process are expected, said Anne Arundel County Executive John Leopold.

Anne Arundel County received $2.5 billion in Defense spending in 2005, the second-largest amount in the state next to Montgomery County, where the government spent more than $3 billion in Defense dollars.

"Ten of the largest Defense contractors have headquarters here, Northrop Grumman being one of them," Leopold said.

"We have seen explosive growth with BRAC," he said. "We are now the heartbeat of the nation's security efforts with NSA and Fort Meade."

But Leopold said he worries that the county's infrastructure may crumble under the pressure of added residents.

"I'm not optimistic that we'll be able to meet that time frame," he said, "but I am hopeful that we will meet that explosive growth in a few years."

Another test for the state will be filling the biotechnology industry jobs, Hayes said.

"Filling the high-tech jobs is a challenge equal to the infrastructure challenges," he said.

"I'm driving to New Jersey right now trying to convince people that Maryland is a great place to live and to work and to play."

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