Monroeville business leaders pondering budget cuts
As Congress and the White House debate the across-the-board federal budget cuts that took effect earlier this month, Monroeville business leaders who deal in government contracts are left holding their collective breath.
Nearly 500 government contracts were awarded to 38 contractors with offices in Monroeville from 2000 through 2011.
The combined value of those contracts was $8.8 billion, according to governmentcontractswon.com.
“It certainly is a concern of ours,” said Jim Hackett, manager of government compliance and accounting for RJ Lee Group Inc.
The company is contracted by the U.S. Department of Energy to staff a nuclear facility in the state of Washington. The contract totals about $12 million annually, Hackett said. If the contract is curtailed, it could result in either a reduction of staff at the Monroeville site or a reduction of hours for staff, Hackett said.
“It's a wait-and-see moment at this point,” Hackett said.
State Rep. Joe Markosek, a Monroeville Democrat, said the concern is valid and that Congress needs to “get their act together and come up with some sort of agreement for a long-term solution to our deficit.”
U.S. Sen. Tim Murphy said the ball is in President Barack Obama's court.
“The sad news is, a lot of this can be avoided,” said Murphy, a Republican from Upper St. Clair. “The president has full discretion of where these cuts are made. Unfortunately, he's not working with the house on these things.”
It's not just large corporations facing a potential loss of funding.
Entrepreneur Bob Digioia, founder of Proxcity in Monroeville, said he was warned to keep an eye on his contract with the U.S. Department of Energy. Digioia developed an interactive children's game for the Carnegie Science Center in Pittsburgh that is federally funded.
“(The science center) sent me an email saying, ‘Anything could happen with your contract,'” Digioia said.
Stakeholders in Monroeville should be concerned, especially after Westinghouse — and the tax revenue it generated — moved to Cranberry, Monroeville manager Lynette McKinney said.
The mere thought of federal budget cuts has altered the business practices of some federally funded agencies, said Mike Hockenberry, federal systems divisions manager for Compunetix in Monroeville. Compunetix provides communications solutions for mission-critical systems — particularly for aerospace, military and government clients.
He said some clients are not permitted to travel to Monroeville, unless it's mission essential.
Hockenberry said he doubts the federal cuts would affect Compunetix because of the recent success of its communications systems, which are used by agencies such as NASA, the National Oceanic and Atmospheric Administration and the military. “I'm still trying to hire,” Hockenberry said. “We're going in to this strong and plan to come out even stronger.”
A majority of federal dollars dispersed throughout Monroeville in recent years were awarded to Bechtel, which provides engineering services and support for the Navy's Nuclear Propulsion Program, according to the company's website. Bechtel's Monroeville plant employees about 800 people, said Dom Bonanno, manager of procurement operations.
Bonanno said that most of the company's government contracts are for five or 10 years, so sequestration probably would not affect the company in the short term.
“We're not changing anything at this point,” Bonanno said.
Markosek said Monroeville residents and officials should be tracking the regional impacts of federal budget cuts, which in turn could affect their community.
He said the University of Pittsburgh receives more federal research grant funding than most universities.
“Sequestration could affect them,” Markosek said. “That is a huge regional impact on our economy, which could indirectly affect Monroeville.”
Kyle Lawson is a staff writer for Trib Total Media. He can be reached at 412-856-7400, ext. 8755, or [email protected].