- The Washington Times - Monday, November 14, 2005

ROANOKE (AP) — Gov. Mark Warner yesterday announced an interim agreement to outsource a significant part of Virginia’s information-technology services and create some 400 jobs in Southwest Virginia.

The 10-year, $2 billion contract with Northrop Grumman Corp. calls for 631 jobs in Chesterfield County and 433 in Russell County, according to a joint announcement by state officials and company executives.

The governor, who was in Lebanon, Va., for the announcement, noted that the contract will provide high-tech jobs in an economically depressed southwest county where less than three weeks ago he announced plans for an additional 300 technology jobs paying an average $51,000 a year — roughly double the average wage for the area.

“I think it could be transforming to the region’s economy,” Mr. Warner, a Democrat, said in an interview. “You’re starting to see critical mass in the region.”

Northrop Grumman, a Los Angeles-based defense contractor whose shipyard is a major employer in Newport News, plans to build a $22.8 million, backup data center and help desk in the Russell County town of Lebanon. About 90 percent of the employees will be from the region, the governor’s office said.

Under the agreement, which is subject to ongoing review by the General Assembly, some 900 Virginia Information Technology Agency (VITA) employees will be offered jobs at a new $34.6 million, 167,000-square-foot Chesterfield location, agency spokeswoman Marcella Williamson said.

The number will be reduced to 631 over the 10-year contract period through attrition, she said.

The jobs involve building and operating the state’s computer network, Warner spokesman Kevin Hall said.

VITA would be left with some 1,200 employees.

Most of the Russell County jobs will pay about $40,000 a year, said Hugh Taylor, president of Northrop Grumman’s Herndon division that performs information-technology services for state and local governments. Salaries in Chesterfield will average $55,000, he said.

“This is a significant step in moving our IT infrastructure into the 21st century so state government can do a better, more cost-effective job serving its citizens,” Mr. Warner said.

In an interview, the governor said the agreement will save taxpayers more than $200 million because the state won’t have to invest in upgrading its computer systems. Northrop Grumman plans a capital investment of $269.6 million.

State employees who go to work for Northrop Grumman would receive 4 percent pay raises and signing bonuses and would be vested immediately in the company’s benefits and retirement plans.

Northrop Grumman was looking for a location for the data center and help desk that was not in a major metropolitan area to keep its costs down, Mr. Taylor said. The company prefers such sites to sending jobs overseas, he said.

On Oct. 28, Mr. Warner announced that CGI-AMS Inc. would invest $6 million to employ 300 people at a software-development and systems-integration facility in Lebanon.

Northrop Grumman plans to start construction at both sites in mid-2006 and hopes to begin hiring workers in a year to 18 months, Mr. Taylor said.

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