Funds for Defense Conversion

* In an unwarranted attack on California’s political leadership, David Friedman misrepresents the state’s efforts to win $472 million for federally funded high-tech projects (“Why California Is Missing Out on a High-Tech Jackpot,” Opinion, May 30) in an analysis that is both inaccurate and misleading.

California is not losing the “war” for defense conversion funds. In fact, California is one of the top two states pursuing funding from the Advanced Research Projects Agency (ARPA), which administers the high-tech defense conversion program.

California’s efforts are not fractured. Friedman reports that staffs of Sen. Barbara Boxer, Gov. Peter Wilson and state Sen. David Roberti are each separately developing “priority lists.” This is false: In fact, all of these offices are working in concert and are not ranking program applicants.

Instead of “playing politics,” political leaders are working--and working together--to improve California’s chances. In a major move, the governor’s Trade and Commerce Agency has singled out $65.6 million in state matching funds from various state agencies. The state’s universities are lending their technical expertise. The Legislature is working to coordinate state programs, publishing economic development opportunities and recommending improvements to the federal defense conversion strategy. The congressional delegation persuaded the Clinton Administration to expedite the release for the 1993 defense conversion funds and the delegation’s Bipartisan Task Force on Defense Reinvestment and Economic Development is shaping California’s approach to the 1994 defense authorization bill, which contains the bulk of defense conversion programs. We at the California Institute, a nonprofit bipartisan corporation providing strategic information to the congressional delegation, are active in coordinating many of these efforts. We have helped network venture capitalists with ARPA applicants and have issued a report with more than 35 recommendations to improve the national defense conversion strategy. Under the California Institute’s auspices, California governmental and industry representatives are meeting, comparing notes and coordinating their efforts.

The Clinton Administration is not “anti-California.” Secretary of Commerce Ron Brown has visited California several times. ARPA held two major briefings for California applicants. The California delegation has alerted the National Economic Council staff to the state’s severe defense conversion needs. The Defense Department selected Alameda County as one of four $500,000 national pilot projects to develop an integrated defense conversion program. California will be one of President Clinton’s first “empowerment zones.”

Friedman’s recommended strategy--demanding the federal agency bow to California’s selected few projects--is inappropriate and ineffective. Many other states can claim a significant share of the funding and won’t yield to any California-focused initiative. Treating the ARPA project like a large-scale project, such as the B-factory at Stanford University, will not work. Finally, his recommendations are misguided: By law, ARPA determines funding on a project’s merits, not geography.

California’s approach to this high-tech jackpot is far from lackluster: By networking entrepreneurs with venture capital and state matching funds, by connecting university expertise and private industry, by working with the Clinton Administration, the state can win.

FRANK CRUZ, Chairman

California Institute

Los Angeles