San Diego's SPAWAR Faces Funding Squeeze

San Diego's SPAWAR Faces Funding Squeeze

San Diego’s SPAWAR, the Space and Naval Warfare Systems Command, has brought economic prosperity and technological innovation to the local and national economy. But sequester cuts may mean sharp cutbacks for SPAWAR–and consequently damaging ripple effects to local economies and community residents.

While SPAWAR is a private company and not directly funded by the federal government, the company competes to win funding from government agencies including the Navy, Army, and Federal Bureau of Investigation (FBI). 

Point Loma Nazarene’s Fermanian Business & Economic Institute (FBEI) recently released its study of SPAWAR’s vital role in the San Diego economy. (Over half of SPAWAR’s employees are employed in San Diego.) The study reported the overwhelming impact this defense contractor has on San Diegans, stating, “SPAWAR will pump over $1.77 billion into the San Diego economy in Fiscal Year 2014.” In addition, “ripple and multiplier effects” of the company will contribute to nearly 19,000 jobs and personal income of $1.6 billion. These jobs include: “those in engineering, scientific research, electronics equipment, personnel agencies, building services, food services and medical offices,” according to also reported: “According to the study, SPAWAR has been an important driver of innovation in San Diego. In the past 20 years, the command’s local research laboratory, SPAWAR Systems Center Pacific, has issued 1,325 documented concepts or disclosures and filed for 900 patents for which a total of 800 have been granted.”

A recent San Diego Union-Tribune article on the FBEI study reported that the company moved to San Diego in 1997 from Washington, D.C. due to previous military downsizing. The U-T also reports, “The work done there [SPAWAR] ranges from cyber security to bomb-fighting robots to unmanned underwater vehicles to the dolphins and California sea lions trained to protect bays.”

SPAWAR is unique in its business model, with project teams that bring together personnel from academia, industry and government. About 1,400 local San Diego businesses contract their products or services to SPAWAR.

More broadly, the Department of Defense provides a large percentage of the jobs in the San Diego region. The FBEI report suggested the “Department of Defense will be at the center of the conflict between national budget pressures and the critical need to upgrade the nation’s technology for defense.” The report also stated that “dollars flowing into San Diego County linked to SPAWAR are expected to decrease 2.4% to $1.73 billion.”

Budget cuts are being made that, according to the FBEI study, affect efficient, productive companies like SPAWAR, and in turn affect local businesses and workers, as well as national security. 

Supporters question whether defense spending should be cut when it remains an urgent priority. The Heritage Foundation lists some government programs receiving funding that may be more likely candidates for cuts.

Photo: Rick Naystatt/U.S. Navy Release