Government contractors around the Capital Beltway already are scouting new office space and thinking about moving some of their employees in response to the planned redeployment of tens of thousands of defense personnel throughout the region.
But the disruption won't necessarily be all bad. Contractors also say the base and office closings recommended by a Pentagon commission could mean more business for them, and give them a chance to lure talented government professionals into the private sector.
In the two months since the Pentagon announced its base closure and reorganization plan, a proposal that would move 23,000 military workers out of Northern Virginia's close-in suburbs, the local government contracting community has been grappling with the potential implications for their businesses.
Though any changes would not be implemented for several years, contractors say they are watching the proposals and efforts to alter the plan closely.
What the government contractors will not do, executives say, is forfeit their projects. If the agencies go, the contractors plan to make every effort to follow. Those decisions could, in turn, deepen the economic impact on areas like Crystal City that are expected to lose jobs, while bolstering the economy around areas like Fort Belvoir where jobs are slated to be transferred.
"If our customer goes, we will, without question, go there," said Renato A. DiPentima, chief executive of Fairfax-based SRA International Inc.
Today, SRA has three floors of leased office space near the Skyline complex close to Baileys Crossroads in Fairfax County. Employees support the Defense Information Systems Agency, which is slated to move from Arlington to Fort Meade in Maryland. SRA managers already are looking at facilities in the Fort Meade area and likely would abandon the Skyline space if the change occurs.
DiPentima said those types of adjustments and the expense of relocating willing employees and hiring new ones are costs that companies like his will have to absorb. The other pitfall, he said, is that many employees have longstanding relationships and expertise with the federal agencies they serve, ties that could be severed because of the relocations if employees decide not to move.
For small companies, the changes could be much more painful.
Four of the nine federal agencies that have hired Knowledge Consulting Group Inc. of Sterling to do information security work could be uprooted under the proposals. If it happens, the five-year old company will ask employees working with those agencies to follow them to their new locations, but chief executive Dusty Wince knows that might not be a popular option.
"Our employees are not necessarily going to want to relocate or drive an hour to get there," Wince said. "We'll have to put them on another mission or they'll leave my company. And when you're a 70-person company, you can't afford to have even one person leave."
The changes could also result in greater opportunities for some local contractors. If the government loses employees who don't want to relocate, their work might be farmed out to private-sector firms. And because the Washington area overall could gain 20,000 government workers -- most of them in locations like Fort Meade, the Aberdeen Proving Ground and Fort Belvoir -- ultimately there could be more work for contractors.
Nancy Lilly, president of JEM Engineering LLC, a small Laurel firm that designs and tests antennas, said she expects her business to increase if, as recommended, an Army communications unit relocates from New Jersey to the Aberdeen Proving Ground, northeast of Baltimore. She also expects to get more work from Fort Meade, which will gain workers under the base restructuring plan.
"In our case it's benefiting us instead of hurting us," Lilly said.
Executives at Alion Science and Technology in McLean also see the potential to profit because of the changes. The company already has begun talking with government officials about helping with the work entailed in moving and consolidating agencies. Dave Powell, division manager for Alion's planning and programming unit, said government contractors always have to be ready for changes like these because contracts begin and end all the time.
"When a contract goes away, whether it relocated or not, we have to make adjustment. That's the nature of the business," Powell said.
Government contractors in the Washington area regularly say the biggest challenge they face is hiring qualified workers with security clearances, a golden ticket in the industry. Human resources officials and recruiters say they expect some federal workers will flip to the private sector when faced with the prospect of relocation.
But it hasn't happened yet, said Linda Drake, vice president of Government Contract Solutions Inc., a Vienna staffing firm that specializes in the defense industry.
"We hope it will release some of the supply, because it's such a tight market," Drake said. "It moves slowly. We haven't seen an influx of people looking to weigh their options, so far."
But some private-sector groups say the impact on the region's government contracting sector could be intensely negative in the long run. Officials from the Northern Virginia Technology Council argue that the changes chip away at the critical mass of intellect that has driven the Washington area economy. Local tech companies may add some good hires to their payrolls in the near term, says NVTC President Bobbie G. Kilberg, but the area could be hurt in decades to come because bright individuals attracted to government work will settle in other regions of the country.
The Missile Defense Agency, for example, is slated for relocation to Alabama from Northern Virginia.
"You'll lose that synergy that makes this region really unique," Kilberg said. "Dispersing and thus damaging the defense research capability of the federal government is not a good thing for the local economy."
Contractors generally are reluctant to bite the hand that feeds them, so criticism of the Pentagon's plan is coming more from elected officials than executives themselves. But most admit that the changes are, if nothing else, a nuisance.
"If you ask them, 'Is this something that you want to have happen tomorrow?' all of them will tell you no," said DiPentima of SRA. "We wouldn't be normal if we didn't like to see our established relationships continue like they are. . . . What this requires is that we remain nimble."