Crane naval base poised for growth as innovation hub

November 27, 2023

By Peter Blanchard, Indianapolis Business Journal

Four semiconductor companies plan to invest more than $300 million to create a 10-acre microelectronics campus called WestGate One at WestGate@Crane. (IBJ photo/Peter Blanchard)

ODON, Ind. – Twenty years after nearly being shuttered by the U.S. Department of Defense, a Navy base in southwestern Indiana has become a key player in the federal government’s strategy to outpace its foreign rivals in the booming microelectronics industry.

Naval Surface Warfare Center, Crane Division is one of three entities leading the Microelectronics Commons program, a Defense Department initiative to create regional “innovation hubs” across the country.

Crane’s presence about 35 miles southwest of Bloomington undoubtedly contributed to Indiana’s being one of seven states to land a hub in the first round of funding, which comes from the Creating Helpful Incentives to Produce Semiconductors and Science Act of 2022, or CHIPS and Science Act. The hubs are expected to spur economic growth while also focusing on areas deemed critical to national security, like electromagnetic warfare, secure computing, artificial intelligence, 5G and 6G wireless, and quantum technology.

NSWC Crane, which employs some of the country’s top scientists and engineers in these cutting-edge technologies, finds itself in an enviable position.

“Increasingly, the Pentagon turns to Crane,” said Jeff Quyle, president and CEO of Radius Indiana, a regional economic development agency representing eight counties in southern Indiana. “That brings not just pride for the region but tangible economic development opportunities. More and more firms in these emerging fields want to draw closer to Crane to have access to the cluster of talent that’s building up in southern Indiana.”

At the WestGate@Crane Technology Park, just outside the naval base, four semiconductor companies plan to invest more than $300 million to create a 10-acre microelectronics campus called WestGate One.

Given the base’s current success, it’s hard to imagine that the world’s third-largest naval installation by geographic area was once on the chopping block.

In 2005, the base was listed on the Defense Department’s Base Realignment and Closure process, part of an effort to reorganize the U.S. military’s base efficiency and structure.

Indiana’s local, state and national officials at that time scrambled to persuade federal officials to keep it open. U.S. Sen. Evan Bayh sang its praises to military leaders, and then-Gov. Mitch Daniels traveled to Washington, D.C., to advocate for its survival.

The base ended up being spared, but it was forced to cut nearly 700 jobs—about 15% of its workforce at the time.

“It was truly a wake-up call,” said Angela Lewis, technical director at NSWC Crane. “The way the Navy and DOD evaluated infrastructure, the things we thought were important didn’t necessarily bear out to be as important. So we really dug in and understood how that worked, and we used that to change as an organization.”

Crane came out of the situation with a strategy to focus on high-tech industries, partner with higher education institutions and establish stronger community ties.

Established in 1941 to store munitions, Crane would later expand to include technical and engineering support for weapons systems.

Unique position

The naval installation is unique in many respects. For one, it’s landlocked, 100 miles from Indiana’s nearest port, and civilian employees, of which there are about 3,800, outnumber military officers 125 to 1.

“It’s very unique in the military world to have a disproportionate number of civilians [on base],” said Matthew Walter, a U.S. Navy officer who was stationed at several U.S. bases and locations in Bahrain, Japan and Cuba before arriving at Crane. “It’s advantageous in a lot of ways. I’m learning it’s a great opportunity for the uniformed sides to work with civilians and government employees and understand the full circle of Crane and how we sustain it. I’m a war-fighter. This is a whole new dynamic for me, but hopefully I’ll be able to move on and take with me what I learned here.”

In the 2023 legislative session, state lawmakers passed laws that directly benefit the activities and communities surrounding Crane.

“Our current laws did not reflect the significance of our military bases to our national security and the state’s economy,” said State Sen. Mark Messmer, R-Jasper, who authored legislation that requires municipalities within a 3-mile buffer zone of a military base to allow the base commander to serve as a nonvoting member on local planning commissions.

The new law also requires municipalities to disclose upcoming developments that could impact U.S. military operations. It was co-sponsored by Rep. Ethan Manning, R-Logansport, whose district includes the Grissom Air Reserve Base, about 12 miles north of Kokomo.

Lawmakers also passed an income tax exemption for military veterans, along with legislation allowing certified technology parks such as WestGate@Crane to capture a larger share of tax revenue.

Opening up

The tech transfer office at Crane works with private industry and academic partners to commercialize technologies developed at the naval base.

“Rather than just letting that intellectual property sit on the shelf, we’re out there marketing its value to folks who could commercialize it or bring it back to the DOD,” said Maria Duran, technology transfer director at Crane.

What happens within the 100 square miles of Crane is mostly classified, but the base has made a concerted effort to open its gates to the outside world and establish partnerships with academia and private industry.

The WestGate@Crane Technology Park, established in 2006, is now home to more than 60 companies ranging from small businesses to Fortune 500 companies.

Purdue@Westgate, a collaboration between Crane and Purdue University and the Purdue Research Foundation, launched in 2017 to advance educational, research and development, and technology commercialization across Indiana.

Indiana University officials announced plans last month to invest $111 million in new faculty, facilities, equipment and strategic initiatives focused on advancements in microelectronics and nanotechnology. As part of the nine-figure investment, the university will collaborate with Crane to address emerging semiconductor technologies, accelerate research and development, and expand the Hoosier microelectronics workforce.

“This is an investment in the economic vitality of our state,” IU President Pamela Whitten told IBJ. “We hope it really represents clear evidence of our commitment as a national defense partner to NSWC Crane.”

Crane began collaborating last year with an electrical and computer engineering professor at Rose-Hulman Institute of Technology. Edward Doering completed a six-month sabbatical at Crane, where he worked on radio technology.

Earlier this month, Crane hosted the five-year anniversary celebration of the White River Military Coordination Alliance, a group formed in 2018 to promote development in the communities near Crane.

Recently, the base invited Derek Miller, the creator of Veritasium, a popular YouTube channel about science, to test “the world’s best night-vision goggles.”

Benjamin Conley, a senior scientist and technology manager at NSWC, was also featured in the video, which received more than 3 million views.

Growth plans

Indiana is poised to play a pivotal role in the U.S. microelectronics sector, which is projected to be a $1 trillion industry by the year 2030.

Minnesota-based Skywater Technology, which is building a $1.8 billion semiconductor production facility at Purdue University, is one of several companies doing business in Indiana that is expected to receive funding from the CHIPS and Science Act.. The project is expected to result in 750 high-wage jobs within five years of opening, according to the Indiana Economic Development Corp.

Indiana is also reportedly one of two Midwestern states competing for a $50 billion semiconductor plant.

The number of employees at Crane is expected to increase soon with the current construction and infrastructure expansion projects, as well as the recently announced $84 million development for a microelectronics campus.

Crane’s partners are working to ensure that there are enough Hoosiers to fill jobs in high-tech industries.

“We’re anticipating rapid employment outside of Crane among the defense-sector employers who are looking for specialized talent,” said Quyle. “We’re going to see a lot of our existing residents be employed by new contractors moving in, but there are going to be some skills that are needed that aren’t available in sufficient quantities in southern Indiana, so we’re going to have to help those companies bring that talent into the region from around the state.”