Maine, Conn. would be hardest hit by base closures: restaurant associations in both states plan to fight Defense Dept. shutdown plan
Restaurateurs in states targeted by the Pentagon’s proposal to close more than 150 military installations said they would fight the cutbacks to ensure continued economic growth of businesses and communities in those areas.
The Base Realignment and Closure plan, or BRAC, which Secretary of Defense Donald Rumsfeld said would save $48.8 billion over a 20-year period, calls for the closure of at least 33 major military bases around the country and a loss of more than 29,000 jobs. While more than 14,000 of those job losses would occur in Maine and Connecticut alone, with cuts taking place over a six-year period beginning in 2006, almost every state is affected by the realignment plan, with some gaining locations. A nine-member commission will make final recommendations this fall.
“This is a horrific disaster for our industry,” said Dick Grotton, president and chief executive of the Maine Restaurant Association. “People go to restaurants with disposable dollars, and if we put 7,000 people out of work [in Maine], it will be profoundly felt throughout the economy.”
The Maine installations slated for closing include the Portsmouth Naval Shipyard in Kittery, the Defense Finance and Accounting Service in Limestone, the Naval Reserve Center in Bangor and the Naval Air Station in Brunswick.
“Hospitality here is a $2.5 billion-a-year industry,” he said, adding: “Restaurant sales per year are about $1.7 billion of that. We need to understand that dining out is not simply done on special occasions anymore. Families and social mores are changing. Today 47 percent of the food dollar is spent on products obtained outside of the home. Take that kind of percentage and place it at risk, and it’s going to be a serious blow to Maine’s economy. I don’t know if people realize how bad it’s going to be.”
On-site contract feeders serving military bases, however, said the closures would not impact their businesses negatively.
“Our business will be unaffected by the proposed closing of military bases,” said a spokeswoman for Charlotte, N.C.-based Compass Group USA, whose Eurest Support Services division provides services for the U.S. Navy and Marines.
Officials at Philadelphia-based Aramark said the company’s business would be unaffected, too.
“None of the handful of military facilities where we provide business dining is slated for closing,” a spokeswoman said. She further stated that those businesses that possibly would experience more economic woes were the “small business set-asides,” or subcontractors who provide foodservice at the military bases.
Sodexho had not returned calls by presstime.
The Army and Air Force Exchange System, or AAFES, which operates a number of commissaries and retail shops for the military, said it is not yet known whether any of their operations are subject to closing.
“AAFES is monitoring the BRAC process,” a spokeswoman said. “No decisions regarding AAFES operations in relation to BRAC will be made until the process is finalized.” She added that the list of closings wouldn’t be finalized until Sept. 23, “when the president either would accept or reject the list in its entirety.”
Though Grotton said it’s still too early to determine the impact of the closings on local business, he noted that entire communities would suffer, not just restaurateurs.
“This will cause an explosion into the entire economy,” he said. He added: “It will affect the local market for sure. Those military personnel who buy cars and furniture provide money for the people selling them those products. And those people take that money and dine out with it. So it ricochets into the economy in a major way. In the case of the shipyard, it’s civilians who work at Kittery. If they lose their jobs, that will ricochet into southern New Hampshire’s economy, too.”
For some restaurateurs, however, the closings represent more than possible economic woes. They’re worried about the emotional impact on their communities.
Michael Landgarten, owner of Bob’s Clam Hut, a fast-casual seafood shop in Kittery, said local residents have great affection for the base and its employees.
“We’ve been here a long time–50 years–and the Navy Yard’s been here a long time as well,” he said. “It’s a known institution. So first and foremost it’s like losing a friend, part of our identity. Feeding those guys, getting them back to work on time, is a great thing for us, especially since the rest of our business is so transient; most of it comes in the summer [during tourism season]. I certainly can’t imagine that this is going to help our business.”
Landgarten estimated that his restaurant, which boasts annual sales of more than $2 million, feeds about 5 percent to 10 percent of the personnel at the Navy Yard.
“We’re a good hit for lunch for a lot of the guys,” he said. “They do major calls with us–they’ll place $100 orders at times–especially in the off-season, so they’re a good call for us.”