Tech industry locals wary of U.S. budget cuts.

Proposed congressional cuts in funding for technology development could be even worse for the Southland economy than cuts in the mass transit arena, say some industry leaders.

Rohit Shukla, executive director of the Los Angeles Regional Technology Alliance, said transit reductions could mean a loss of tens of thousands of jobs and billions of dollars, but slashing high-tech programs could change the very shape of the local economy's future.

Southern California, already hammered by cuts in defense spending and manufacturing job losses, has been moving toward an economy based increasingly on high-tech development and "clean" industries.

Now the federal government is looking at eliminating its Technology Reinvestment Program, which fostered the development of "dual-use" technology (the conversion of defense technology for use in the private sector) and the Advanced Technology Program (ATP), in addition to slashing NASA's budget.

"At a time when California is developing a new type of economy of its own, these types of (programs) are a real shot in the arm," noted Shukla. "Potentially, these cuts could be just as bad (as the transit cuts) in the long term in their effect on how our economy develops."

Larry Dumas, deputy director of Jet Propulsion Laboratory in Pasadena, said thousands of local well-paying, highly skilled jobs could be lost because of proposed cuts in NASA's programs.

The laboratory at the California Institute of Technology devotes much of its time to NASA's Space Science planetary exploration program. It employs about 5,700 people, plus 1,200 on-site contractors, for a total of 6,900. About 80 percent of JPL's staff are salaried professionals, and about 66 percent are scientists and engineers, he noted.

2,000 jobs threatened

Dumas said that under President Clinton's budget plan, JPL was forecasting cutting down to about 5,000 employees and contractors, a loss of close to 2,000 people. Clinton was proposing reductions of about $5 billion, compared to the fiscal 1995 budget plan. But now Congress is planning to cut twice as much, he said.

"We've given just about everything we can give. The next step is you have to cut some (entire) programs," Dumas said.

The impact on JPL, he said, would depend on which program or programs were scrapped.

"Our fortunes are linked directly to NASA's fortunes," he said.

Another NASA program that employs people locally is the space shuttle program. Rockwell International Corp. built shuttles for NASA and continues to provide "support services" for the program, noted spokesman Bill Blanning in Seal Beach.

He added that the federal government is considering privatizing shuttle operations.

Blanning did not have any information on the possible impacts of NASA budget cuts on the local aerospace industry, nor did a NASA spokesman in Washington, D.C.

Meanwhile, Shukla said local operations of such companies as Lockheed Corp., Hughes Electronics Corp. and TRW Inc. stand to lose out on hundreds of millions of federal dollars if the Technology Reinvestment Program is cut. In 1992-93, he said, $400 million was earmarked for the defense conversion program and was awarded in multi-year contracts. In 1994-95, the budget was supposed to be $600 million, but it was cut to $160 million, Shukla said. Now Congress is looking at scrapping the program altogether.

"The horror, of course, was all these companies had multi-year deals," Shukla said. "It is not in the congressional budget for next year at all."

A number of small local companies, meanwhile, benefited from the ATP, Shukla said. Of the $400 million awarded this year, about $200 million of that went to California firms, and about half of that went to Southland companies, he said.

The budget for ATP was expected to increase to $800 million next year under Clinton's budget, but under congressional budget proposals, it would be axed, he said.

"Unfortunately, grants to develop generic technologies fell under what the Republicans are calling 'industrial welfare,'" said Shukla.

He added that additional cuts in funding for federal job training programs will likely further dampen California's economic recovery.