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Orlando won't get NASA's new service center

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WASHINGTON -- Orlando is out of the running for a lucrative business-services center NASA plans to open later this year, the agency announced Friday.

Through several delays and a complete change in the rules of the competition, government and economic-development officials from throughout Central Florida had coveted the planned Shared Services Center. They were enticed by the prospect of almost 500 jobs, paying an average of $50,000 a year, and long-term plans for as many as 1,500 workers.

But of the six cities competing, only Huntsville, Ala.; Brook Park, Ohio, near Cleveland; and southwest Mississippi remain in contention.

Orlando, Houston and Newport News, Va., were not chosen as target sites by any of the private contractors bidding to run the center, NASA spokesman Robert Mirelson said.

NASA plans to award a contract for the center in May, he said.

Reaction ranged from disappointment to disbelief among local and federal officials.

The knowledge that Central Florida had been a top-ranked choice in an internal NASA study, done before the open competition, made the news all the more difficult to take.

Dan McLaughlin, spokesman for U.S. Sen. Bill Nelson, who fought hard for the center, said the Florida Democrat was upset at the latest development.

"He's extremely disappointed. He feels that the decision was influenced, to some extent, by politics, since NASA itself had indicated that it wanted the center in Orlando, and that NASA's own wishes were ignored," McLaughlin said of Nelson. "It's a sad day that the administration has yanked the rug out from under Orlando."

A spokesman for U.S. Rep. Ric Keller relayed the Orlando Republican's first response: "I can't believe the rocket scientists at NASA think a family would rather live in Cleveland than in Orlando."

But ultimately, the decisions may have been much more about the bottom line than anything else. While Orlando met many of NASA's criteria for the center, including easy access to a major airport, the communities still in the running -- especially in Ohio and Mississippi -- made much sweeter offers.

For example, according to The Plain Dealer of Cleveland, a consortium in Ohio offered tax incentives that would reduce the cost of renting an office building for the center to $2.60 per square foot, with an option to buy the building for $1 after the expiration of a 35-year lease.

Mississippi and Louisiana offered a joint package worth more than $20 million. Alabama also has a record for offering huge incentives to lure jobs, though no details on the NASA proposal were available Friday.

In Orlando, the package -- cobbled together with help from the state and local governments -- was worth about $5 million, including incentives.

Dale Ketcham, who worked on the deal while at Enterprise Florida, the state's economic development arm, said that amounted to about $25 per square foot for a site in the Central Florida Research Park.

"We thought we had it," said George Rodon, Orange County's economic-development director. "Obviously, we are very disappointed. We think we offered the best deal. But I have heard that the other communities put millions of dollars in incentives before them, and we don't do that.

"If that's what it takes, we're not going to participate."

It's always difficult to compete against states such as Mississippi, which routinely offer huge incentive packages to lure businesses.

Joe Wallace, executive director of the research park, near the University of Central Florida, said he wasn't surprised by Friday's news.

"The state of Florida isn't like Alabama or Mississippi," Wallace said. "We don't need to offer free land and free buildings. It became clear to us in the last few months that NASA was looking more toward a free deal. But we are a market-driven deal here."

Since NASA announced plans to consolidate some administrative services now being done at all 10 of its field centers, the process has caused heartburn. Initially, NASA said it planned to make a decision on the location of the center by March 2004.

But in late March, NASA officials signaled that they would change the process, and in early April, it became official: All six sites met the agency's criteria, so NASA would leave the geographic choice up to the companies competing to build the center.

At the time, the change was attributed by many on Capitol Hill to be related to the fall elections, with Florida and Ohio serving as key swing states.

Even now, politics may be coming into play: The new chairman of the Senate Appropriations Committee, Sen. Thad Cochran, is a Republican from Mississippi.

John Krug, vice president for business development at the Metro Orlando Economic Development Commission, called the selection process "very unorthodox."

"We think it basically became unpalatable for NASA to be involved in the site-selection process," he said.

The commission made presentations to nine companies bidding to operate the center, Krug said. That group later consolidated to small consortiums led by IBM, Lockheed Martin and Computer Science Corp., he said.

Ketcham said the Orlando group thought that some of the things the area could offer might be worth more than a huge incentive package. But once the bidders controlled the location decision, he said, those things mattered much less.

"Florida never does give away the farm," he said. "Given that we don't do that, I think they put a pretty good package together. . . . Everybody really did yeoman's work here."

Nelson's spokesman said the senator doesn't know whether the decision can still be influenced in any way, but that he vowed Friday to try.

"He'll be looking at this before it is completely final," McLaughlin said. "At this point, it probably looks like a lost cause, but one never gives up hope."

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This is tough news to take. I thought Orlando had this one in the bank. However, officials did the right thing. Florida doesn't need to give the house away to attract these companies. You lose some, you win some.

BTW, Cleveland's a pretty cool city. If it I loved cold weather and could find a job, I'd move there in a heartbeat.

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I'm happy the state is speaking out in dissapointment with NASA on this one. Its weird to me that both Houston and Orlando are out when both cities are centers of space exploration.

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it sucks, but then again as the article says the only thing that really matters to NASA with this is the bottom line. It would be insane for Orlando to give out the kind of incentives that Cleavland or Mississippi are giving. It sucks that we can't land this, but I'm glad Florida isn't going to throw NASA millions of dollars for something that will only generate at most 500 jobs.

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