LOCKHEED, PALMDALE SEEK NEW DEAL; COMPANY, CITY LEADERS EXPECT SETTLEMENT IN $800,000 IN INCENTIVES.

Byline: Jim Skeen Daily News Staff Writer

Palmdale officials will meet tonight with representatives of Lockheed Martin Corp. to try to resolve a snag in the city's commitment of $800,000 in incentives for the X-33 project.

Palmdale had pledged $800,000 in hiring credits to Lockheed Martin's ``Skunk Works'' facility for the X-33 work, but that plan was derailed when the company opted to perform the work in a hangar located just outside city limits in unincorporated Los Angeles County.

State redevelopment agency laws prohibit Palmdale from extending hiring credits outside city limits.

``If we are going to pay to bring jobs into the city you have to bring them into the city, not into the county,'' said Palmdale City Councilman Jim Root.

The X-33, which Lockheed Martin hopes will be the forerunner of a new spaceship, is being built in a hangar leased from Boeing Co. The hangar was used for the B-1B bomber program in the 1980s, and was recently used as a set for a movie called ``The Flood.''

City Manager Bob Toone has proposed honoring the incentive commitment by waiving impact fees of $227,000 owed to the city by Lockheed Martin for construction work at the company's plant prior to 1997, and waiving $170,000 in fees for work to be done this year and in the future. The balance would be given in cash, according to a city staff report.

Lockheed Martin has proposed the incentives be given in cash over a 10-year period.

``I'm very optimistic it can be resolved,'' said Councilman David Myers. ``It's a matter of figuring out the best avenue for Lockheed.''

The idea of the $800,000 credit came about two years ago when Antelope Valley and state officials were scrambling to put together an incentive package to keep the X-33 project in California. At the time, California leaders were worried that New Mexico and Florida would lure the project away.

Palmdale officials proposed the $800,000 based on the idea that Lockheed Martin would create 400 new jobs in the city as a result of the X-33 program.

Last July, Skunk Works won a $941 million National Aeronautics and Space Administration contract to develop the X-33. The company is expected to invest $212 million of its own money in the program.

The X-33 is a 53 percent-scale aircraft of a single-stage-to-orbit spacecraft - dubbed VentureStar - that the Skunk Works facility plans to build. The X-33 is expected to have its rollout in October 1998, and will conduct its first test flight from Edwards Air Force Base by March 1, 1999. The X-33 itself will not go into space, but it is intended to lead to the production of a spacecraft that will lower the cost of putting satellites and other payloads into space from $10,000 a pound to $1,000 or less.

To be launched vertically like a rocket from Edwards, the X-33 is scheduled to make 15 flights in 1999 to landing fields in California, Utah and Montana.

The workshop is scheduled for 7 p.m. in the city's administration training room, 38300 Sierra Highway.