Local Economy Facing Uncertain Future if Sequester Shrinks Budgets

A political deal struck in the summer of 2011 will begin to affect the economy today, unless feuding lawmakers in Washington can agree on a compromise.

The sequester will mandate significant cuts to the federal budget, with few if any government agencies immune to reductions in funding. Defense and domestic spending will be evenly slashed, and the impacts on local economies are far from clear.

Los Angeles County has some 76,300 federal employees and retirees, according to Eye on Washington, and their fate could include furloughs or worse. Media reports include warnings on delays in air travel and tax refunds. Civilians employed by the Department of Defense face the possibility of furloughs.

“The possibility exists for a 22-day furlough of Federal employees,” said Brian O’Rourke, spokesman for Navy Region Southwest.

But how does that affect the Cerritos-Artesia area?

The cuts could trickle down to 17 Cerritos-based companies that did business with the Department of Defense last year to the tune of about $2.25 million.

According to the Center for Defense Policy, which in September released updated data from several federal sources, these Cerritos companies did business with the Pentagon in 2011 (with the number and value of contracts noted):

• Accurate Air Engineering, Inc. (three contracts valued at $66,292) on Carmenita Road in the category of "Industrial Machinery and Equipment Merchant Wholesalers"
• Aline Heat Seal Corporation (three contract valued at $3,703) on Struikman Road in the category of "Packaging Machinery Manufacturing"
• American Textiles Systems (18 contracts valued at $819,908) on 166th Street in the category of "All Other Miscellaneous Chemical Product and Preparation Manufacturing"
• Apperson Print Resources, Inc. (contract valued at $7,140) on Cerritos Corporate Drive in the category of "Other Professional Equipment and Supplies Merchant Wholesalers"
• Bar Engineering & Manufacturing, Inc. (two contracts valued at $0) on Norwalk Boulevard in the category of "Other Aircraft Parts and Auxiliary Equipment Manufacturing"
• Bermingham Controls, Inc. (nine contracts valued at $99,897) on Business Circle in the category of "Commercial and Industrial Machinery and Equipment (except Automotive and Electronic) Repair and Maintenance"
• California Nanotechnologies, Inc. (contract valued at $14,422) on Edwards Road in the category of "Research and Development in the Physical, Engineering, and Life Sciences (except Biotechnology)"
• Consolidated Trading Co. Of America (contract valued at $296,128) on Mardquardt Avenue in the category of "Computer and Computer Peripheral Equipment and Software Merchant Wholesalers"
• Corelis, Inc. (seven contracts valued at $88,762) on Alondra Boulevard in the category of "Instrument Manufacturing for Measuring and Testing Electricity and Electrical Signals"
• James Di Rosa, Inc. (15 contracts valued at $169,535) on Fabrica Way in the category of "Other Apparel Accessories and Other Apparel Manufacturing"
• Eide Industries, Inc. (contract valued at $11,102) on Piuma Avenue in the category of "Other Ordnance and Accessories Manufacturing"
• Ftg, Inc. (seven contracts valued at $270,337) on Center Court Drive in the category of "All Other Motor Vehicle Parts Manufacturing"
• Genard, Inc. (contract valued at $68,086) on Midway Avenue in the category of "Painting and Wall Covering Contractors"
• Icon Safety Co., Inc. (contract valued at $0) on State Road in the category of "Instruments and Related Products Manufacturing for Measuring, Displaying, and Controlling Industrial Process Variables"
• Sitwell, LLC. (five contracts valued at $133,950) on Distribution Way in the category of "Office Furniture (except Wood) Manufacturing"
• Society Of Mexican American Engineers & Scientists (five contracts valued at $164,500 on South Street in the category of "Colleges, Universities, and Professional Schools"
• U.S. Armor Corporation (three contracts valued at $40,499) on Valley View Avenue in the category of "Other Clothing Stores"

Colleges and universities across the country will also feel the impact of automatic federal spending cuts. (Click here to see the effects on Cerritos College.)

“The across-the-board cuts of sequestration threaten hundreds of thousands of California jobs, services for children, seniors and veterans, not to mention our overall economic recovery," said Congresswoman Linda Sanchez of the 38th Congressional District, which includes the cities of Cerritos and Artesia. "I am fighting my hardest to prevent these reckless cuts because they would be devastating to California. Reducing our deficit is important. However, I believe we should take a balanced approach that protects working families and won’t hurt our economic recovery.”   

The Obama administration released on Sunday a report for each state detailing the impacts of the sequester’s budget cuts, and Republicans have accused the president of using scare tactics for political gain.

The seven-page report for California paints a grim picture for education, environmental protections, the military, law enforcement, child care, public health and government services. The report is attached to this article in the PDF section.

The nation has been through this drill before. The sequester was set to begin on Jan. 1, 2013, if lawmakers weren’t able to reduce the budget deficit. That deadline came and went, but they were able to agree on postponing the sequester for two months. That time is running out.