Local companies cash in on defense contracts

Esmerelda Valdez, a screen print support staff member, uses a razor to perfect a screen Friday at Luster-Cal Nameplate Corp. The Lodi company makes labels and warning tags out of aluminum and vinyl, and does 5 percent of its business with the defense industry, according to company President Joe Hohenrieder. (Jennifer M. Howell/News-Sentinel)

Local companies cash in on defense contracts

By Matt Brown
News-Sentinel Staff Writer

Saturday, October 20, 2007 7:09 AM PDT

Comments (5 comment(s))

The U.S. Department of Defense gobbles up a massive $439.3 billion budget to support two wars, three million troops and civilians worldwide and the latest hi-tech fighting machines.

Much of that money is spent within the department. But some of it trickles out down to the local level.

The military hires outside contractors for many things from dry-cleaning to fighter jet parts. When it does, the department spreads the wealth to businesses large and small across the United States.

In San Joaquin County, 128 companies had contracts with the Department of Defense in 2006, according to governmentcontractswon.com, a Web site that tracks Defense Department contracts.

Eleven companies in Lodi and Galt had contracts last year ranging from $1,300 to $117,741. Local companies manufacture and distribute defense products from pool filters to name plates on bombs.

Lodi company Lustre-Cal, which makes labels and warning tags out of aluminum and vinyl, does 5 percent of its business with the defense industry, according to President Joe Hohenrieder.

The company has sold $3,763 worth of products directly to the Defense Department, according to the Web site, but the bulk of its sales is to other defense contractors who make things from bombs to ejection seat.

"We have stuff that went to Desert Storm," Hohenrieder said.

Some of Lustre-Cal's etched aluminum labels have found their way to the moon on one of the lunar missions. The company also makes "asset identity tags" that read "Property of the White House" and are used by President Bush.

Joseph Hohenrieder, president of Lustre-Cal Nameplate Corp., holds a batch of etched nameplates Friday. (Jennifer M. Howell/News-Sentinel)

Galt resident Ron Ybarra visits military installations around the state selling his company's products. Aqua Tech Enterprises, which sells filters and chemicals for large pools, has a $117,741 contract with the Defense Department, according to the Web site.

"We don't sit back and wait for the government to bid," Ybarra said. "We're really proactive in terms of visiting bases and finding ways to improve their efficiencies."

Aqua Tech products help clean the pools at Sea World and Raging Waters, but they are also used in the large water tanks that Navy pilots use to simulate water landings, Ybarra said.

Not all of the local defense contractors sell products with glamorous applications. Lodi Tent and Awning Company has sold portable shade canopies to the military for 10 years, according to company president Paul Welk.

Labels for the White House are displayed Friday at Lustre-Cal Nameplate Corp. (Jennifer M. Howell/News-Sentinel)

The tents are probably used on state-side military bases for outdoor functions, but Welk can't be sure.

"I don't ask them what they do with them," he said. "I just tell them to buy more tents."

In 2006, the Defense Department bought $7,118 worth of tents, according to the Web site.

Across San Joaquin County, defense contracts ranged from a $1,140 purchase order for prefab structures from Mobile Mini, Inc. of Lathrop, to Stockton-based Coastal Pacific Food Distributors whopping $43 million contract to provide food to the troops, according to the Web site.

As with Coastal Pacific Food, A government contract can be a windfall for business. But scoring a lucrative deal is often political, according to Michael Hatch, a University of Pacific political science professor. Congressional representatives try to funnel government business back to workers in their home districts, Hatch said.

"It's been my impression that representatives from various districts try to bring contracts into their areas," he said. "They try to make sure Defense officials are aware of their companies."

Lodi and Galt Defense contracts in 2006

Lodi

American Master Tech Scientific: $8,404 for medical and surgical instruments and equipment.

Anderson, Neil O. and Associates: $59,500 for facilities operations support services.

Dependable Precision Manufacturers: $72,014 for machine shop sets, kits, outfits, antennas, waveguides, centrifugal separators and miscellaneous vehicular components.

G-REM: $1,870 for maintenance or other hospital buildings.

Herreras Mechanical Design: $1,300 for aircraft maintenance and repair.

Holz Rubber Company: $12,520 for fittings and specialty hoses, pipes and tubes.

Lodi Metal Tech Inc.: $6,018 for lumber and related basic wood materials.

Lodi Tent and Awning Co, Inc.: $7,118 for recreational equipment.

Lustre-Cal Nameplate Corp.: $3,763 for signs, advertising displays and identity plates.

Galt

Aqua Tech Enterprises, Inc.: $117,741 for athletic and sporting equipment, chemicals and water distillation equipment.

Evelyn R. Hatfield and Associates: $26,600 for other professional services.

Source: http://www.governmentcontractswon.com.

Rep. Jerry McNerney, who represents much of San Joaquin County, is keen on bringing government and defense spending back to his district, said his spokesman Andy Stone.

"The Department of Defense has needs," he said. "If a local company can fill those needs, its a priority to match them up."

Some local companies don't wait for contracts to be funneled their way. Lodi Metal Tech, Inc. has a salesman based in Washington, D.C. to manage its government contracts.

The company has sold $6,018 worth of warehouse storage racks to the Defense Department, according to the Web site, but it has a $3 million contract with the Department of Justice, said Paul Minich, manager of government sales.

Many of the company's products still end up on military bases, Minich said, because the Justice Department's distributor, UNICOR, sells to the military.

Minich said he just secured another five year deal with UNICOR, which represents 10 percent of Lodi Metal's business.

"I had to go out and solicit for that," he said. "There's a lot of liaison work."

Contact reporter Matt Brown at mattb@lodinews.com.

Reader Feedback

Wondering wrote on Oct 26, 2007 8:15 PM:

" You mention labels,filters, etc. What about Lodi's own Armour Struxx who manufacture's anti balistic inserts for the Humvee vehicles in Iraq? This is what protects our troops from roadside bombs. Seems a little more important than labels and filters. "

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SJUNE45 wrote on Oct 21, 2007 2:50 PM:

" ITS NICE TO HEAR GOV'T DOING BIZ WITH LOCALS. "

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OTH wrote on Oct 20, 2007 6:44 PM:

" You call these sums cashing in? Other companies have made billions. That,s cashing in. "

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wellwell wrote on Oct 20, 2007 12:41 PM:

" Death is always profitable for corporate America. "

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judy wrote on Oct 20, 2007 8:23 AM:

" Interesting dollar amounts reported here - some very low for government contracts. I recently read an article that stated some CEOs were making much larger amounts in their salary because of their war contracts. The article was about who is actually profiting from this war and made it clear big business is. These CEOs were making an increase of millions and millions of dollars in their yearly salary. Glad Lodi and Stockton were not on the top of that list. "

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