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State looks for share of peace dividend

Defense contractors in Florida facing continued Pentagon spending cuts might find their future in industries as diverse as space exploration, transportation infrastructure and environmental restoration.

But even in the best-case scenario, the Governor's Defense Reinvestment Task Force was told Friday, the end of the Cold War is expected to have a profoundly negative impact on the Sunshine State's economy for some time.

Gov. Lawton Chiles commissioned the group of defense industry executives and government officials in May to try to get a share of any peace dividend from the federal government.

The task force is about to prepare its report. Contractors represented on the panel include Honeywell Inc., Martin Marietta Corp. and United Technologies Corp.

"We're not getting our fair share of money," said U.S. Rep. Jim Bacchus, D-Orlando, the task force's chairman. "We need to establish a state-driven strategy for transition, and a way to sell it to the federal government."

Florida Commerce Secretary Greg Farmer said the state should streamline the regulatory process and develop incentives to make the state attractive for relocations.

Defense spending in Florida totaled nearly $11-billion in fiscal year 1991. About half was spent on defense contracts to companies and half went to operate military bases.

Defense-related activity is the state's third largest economic sector. In all, the industry employs 245,000 Floridians. As many as 45,000 of those jobs may evaporate by 1997, according to a recent study cited by the panel.

Contractors that have worked with the government will have to become more nimble in the private sector, said Tom Keating, vice president of economic affairs for the Florida Chamber of Commerce.

"Military firms don't have marketing in a typical sense," said Keating. "What they have is a retired general."

Among the issues the panel has grappled with are whether to emphasize helping individuals, through programs such as retraining, or whether to focus on finding work that is valuable to society for contractors.

"These contractors defeated Saddam Hussein through the sheer weight of technology," said Ronald L. Smith, director of corporate contracts and business policy for Grumman Corp. in Bethpage, N.Y.

"We want to keep the team together," Bacchus replied. "Human nature doesn't change and we have to be prepared to go to war again."

Panel members expressed support for such projects as the space station and high-speed rail systems.

Dr. Joseph A. Angelo Jr., director of advanced technology for Science Applications International Corp. in Melbourne, said Florida firms are poised to develop a unique specialty using robotics at hazardous-waste sites.

Still, the panel was warned to prepare for things to get worse before they get better.

"Reality means that some businesses will not survive regardless of help," said Wayne H. Coloney, a principal in the Tallahassee-based crisis management firm, Coloney Von Soosten & Associates Inc.