PORTSMOUTH, Va. (WAVY) - Cuts are coming to the military and Thursday Leon Panetta outlined how his department will be changing over the next ten years.
In a press conference, the Secretary of Defense said the department will absorb $487 billion in cuts.
While cuts to defense spending are always a concern in Hampton Roads, there were some positive takeaways from Panetta's remarks. But before any celebrations commence, there are two things that must be considered when assessing the impact of first round cuts.
The first is the impact on TRICARE or healthcare benefits for veterans. Next, how a reduction in Norfolk's fleets over the next five years will affect everyone as a whole.
Panetta said, "Make no mistake, the saving that we are proposing will impact on all 50 states."
Perhaps one of the most striking impacts the new defense budget will have for veterans is on the cost of health care for veterans.
"To help control the growth of healthcare costs, which is now almost $50 billion in this department, we are recommending increases in healthcare fees, co-pays and deductibles for retirees," Panetta said.
Specifically, the DoD will be increasing and adding new enrollment fees for retirees under age 65 in the TRICARE program, using a tiered approach based on retired pay. Senior grade retirees would pay more, junior grade less.
A new enrollment fee will also be established for the TRICARE-for-Life program for retirees 65 and older, again using a tiered approach.
Additionally, there will be increases in pharmacy co-pays.
There is also a likelihood that the Norfolk fleet will see some small reductions. The plan calls for retiring seven cruisers early, six of which lack Ballistic Missile Defense Capability.
The DoD will also retire two smaller amphibious ships or (LSDs) one or both could come from this region.
Although these sound like relatively small cuts, over time they will have a trickle down effect on the local economy, affecting everything from schools to small businesses.
But, there is also the potential for good news to local industry.
Panetta said, "At a critical part of our ability to mobilize is a healthy industrial base. Maintaining the vitality of our industrial base and avoiding unacceptable, imposing costs or risks."
That could be good news for Newport News Shipbuilding. Especially since the DoD expressed a commitment to upgrading and maintaining the Virginia Class Submarine program, some of which are built at Newport News.
The biggest concern many members of the Hampton Roads congressional delegation have about the news out of Washington was the Defense Secretary's announcement that they would return to the BRAC process for base closures.
A company has been hired to complete the repairs to the Herbert C. Bonner Bridge on the Outer Banks, but how long those repairs will take remains unknown.
Drivers traveling between Hatteras Island and the mainland were forced to use an emergency ferry Wednesday, following the sudden closure of the Bonner Bridge Tuesday.
State officials say construction on a new Bonner Bridge has been delayed for years because of a legal battle with an environmental group.