Nellis: Mission Critical

Nellis Air Force Base is known around the nation as a major pillar of advanced combat aviation preparation. Today, the United States Air Force Warfare Center (USAFWC) units provide training for every type of aircraft in the United States Air Force (USAF), along with air and ground units of the Army, Navy, Marines and air units from other allied nations. The air force base also plays a key role in tactics development, operational testing and evaluation. It is a keystone of national security and developing the next generation of our defense system. To Southern Nevada, however, it fulfills another fundamental role to the vitality and sustenance of our local economy.

Much like the origins of the Las Vegas community in general, Nellis Air Force Base began small. It was a private airstrip for Nevada Airlines in 1929, and was purchased by the City of Las Vegas in January 1941. In March 1941, the Army leased the field from the City and called it the Las Vegas Army Air Field. It hosted the Army Air Corps Flexible Gunnery School, which began B-17 gunnery training in early 1942. During World War II, more than 600 gunners and 215 co-pilots were trained and graduated from the school every five weeks. After the war, the base reopened as the Las Vegas Air Force Base, and was permanently renamed in 1950 to honor the memory of Lieutenant William Harrell Nellis.

At the beginning of the Korean War, the mission changed to advanced combat-crew training and the gunnery school was reestablished to perform advanced tactics instruction, research and testing. Today, the advanced training missions continue under the USAF Weapons School, and the USAFWC units at Nellis continue to provide training and support for composite strike forces that include every aircraft in the USAF inventory. The base also supports training initiatives for the Army, Navy, Marines and air units from allied nations. The 57th Wing is the operational element of the warfare center, which includes the USAF Air Demonstration Squadron (“Thunderbirds”), as well as the 57th Operations Group, 57th Maintenance Group, USAF Weapons School, 414th combat Training Squadron (Red Flag), 547th Intelligence Squadron and the 549th Combat Training Squadron (Green Flag-West). There are several other units at the USAFWC, including the Nevada Test and Training Range (NTTR), which is responsible for developing, operating and maintaining facilities at the Range to simulate a realistic combat environment and satisfy training and other requirements for duty.

Nellis also houses five major tenant units and more than 50 smaller tenant units and activities, as well as the Armed Forces Reserve Center, which hosts U.S. Navy Reserve, U.S. Army Reserves and U.S. Marine Corps Reserve units. Nellis is a bustle of training, development and tactical instruction, and employs approximately 8,500 military and more than 4,000 civilian personnel between it, NTTR and Creech Air Force Base. Its activities make it a “linchpin of mission readiness for today’s Air Force,” according to an economic impact analysis produced by the USAF.

In the Ecomomic Impact Analysis report in fiscal year 2012, Colonel Barry R. Cornish, Installation Commander of Nellis Air Force Base for the fiscal year 2012, outlined the economic impact of having such a prominent military presence in the Valley. The total economic impact of Nellis, Creech and NTTR operation in fiscal year 2012 amounted to more than $5 billion. Between all three bases, the military and civilian payroll totaled more than $922.9 million, with an estimated 5,637 indirect jobs created with an estimated dollar value of $229.7 million. Military retiree salaries in the community add $673.8 million to the military impact in Southern Nevada. Combined with annual expenditures, the dollar value of indirect jobs created and the annual Aviation Nation open house event, the $5 billion impact of the military community has a multifaceted effect on the entirety of Southern Nevada and creates a richer, vibrant and more diverse society.

Nellis is also one of the largest single employers in Southern Nevada. This creates a colossal impact on the livelihood of Southern Nevada. Especially in the last few years, Nellis has steadily created military and civilian jobs, and now includes more than 32,000 total personnel between the two classifications. It is difficult to imagine how the landscape of Southern Nevada’s economy would appear without Nellis Air Force Base.

It may be a possibility in the near future for the community, however. Sequestration – or “sequester cuts” – has been a hot button issue in Washington, D.C. that strikes particularly close to Southern Nevada.

Sequestration is a fiscal policy procedure adopted by Congress to address the federal budget deficits. Sequestration, as outlined by the Budget Control Act of 2011 (BCA) and if implemented, would mandate about $500 billion in across-the-board defense spending cuts over 10 years, in addition to $487 billion in cuts mandated over that period by the BCA. That translates to about a 10 percent cut to the defense department. Sequestration would not affect military compensation, but may manifest in regards to non-military compensation, such as contractors and civilian personnel. In Nevada, more than 500 companies did $1.33 billion in business with the Department of Defense in 2011; under sequestration, those dollars would be reduced by $239 million. Such a loss could result in cutting 6,247 jobs, including 580 civilian Department of Defense jobs and $236 million in annual lost earnings for Nevada. Clark County’s annual revenue may fall $28.5 million a year under the cuts per the BCA.

These contractors and civilian companies that conduct business with the Department of Defense include 69 minority-owned businesses, 61 small businesses and small disadvantaged businesses, 99 woman-owned businesses and 77 veteran-owned businesses. From a local dairy company supplying milk products to the base to the Las Vegas-Clark County Library District providing online access to its collection and receiving books and materials in the Nellis library, cuts under sequestration potentially threaten all aspects of economic and community growth for the Las Vegas area. Radically reducing the support Nellis Air Force Base receives would have a major effect on Southern Nevada’s economy, jobs and spending, and could put the brakes on the forward motion of the recovery efforts. It would undermine job creation, innovation, government contracting and reduce Nevada’s competitiveness for attracting new businesses and industries to the area.

Even the potential of sequestration cuts has USAF leaders rethinking some of Southern Nevada’s military exercises. In early February, the USAF announced the possible cancellation of upcoming Red Flag exercises at Nellis, as well as potentially grounding the Thunderbirds demonstration team if a solution isn’t agreed upon. In regards to Nellis, Air Force Vice Chief of Staff General Larry Spencer has claimed that the weapons school and many of the programs at Nellis would be “heavily affected.” The Air Force will most likely realize these cuts by reducing more than 200,000 flight hours for the fiscal year, which began October 1. In addition, Nellis is expecting the first round of test F-35 jets, which would replace older F-16 fighter jets and A-10 attack jets, for testing at the base early this year. Sequestration could delay production and testing, as well as force bids to be reopened for these programs, increasing procurement costs and resulting in further delays.

Nellis Air Force Base, as well as Creech Air Force Base and the NTTR, has represented a dynamic and integral piece of Southern Nevada’s economy since its founding. With sequestration looming as a major threat to economic recovery in the valley, Southern Nevada is in a holding pattern over how sequestration will be realized in the area, and how to recover from the blow of the economic impact not only to the military community, but those who do business with it.

The Las Vegas Metro Chamber of Commerce advocated against sequestration in a trip in late 2012 to Washington, D.C., citing the economic impact of the military community in Las Vegas and how it would impede efforts to grow and diversify Southern Nevada’s economy. The Metro Chamber will continue to keep its members apprised of the developments through LVChamber.com, email updates and legislative briefings in the Business Voice.