[Federal Register Volume 60, Number 139 (Thursday, July 20, 1995)]
[Rules and Regulations]
[Pages 37337-37348]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-17737]
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DEPARTMENT OF DEFENSE
Office of the Secretary
32 CFR Parts 90 and 91
[RINs 0790-AF61 and 0790-AF62]
Revitalizing Base Closure Communities and Community Assistance
AGENCY: Office of the Assistant Secretary of Defense for Economic
Security, DoD.
ACTION: Final rule.
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SUMMARY: This rule amends DoD's Revitalizing Base Closure Communities
and Community Assistance regulation, and promulgates guidance required
by Title XXIX of the National Defense Authorization Act for Fiscal Year
1994, including those provisions required by Section 2903. This rule
also establishes policy and procedures, assigns responsibilities, and
delegates authority to implement the President's Program to Revitalize
Base Closure Communities, July 2, 1993. This document does not include
guidance on acquiring property for the cost of environmental cleanup
(Section 2908) or on the substantial changes made in the Base Closure
Community Redevelopment and Homeless Assistance Act of 1994. The
changes stemming from this Act will be made in an accompanying rule,
which will be open for public comment and which will be published by
the Departments of Defense and Housing and Urban Development.
EFFECTIVE DATE: July 20, 1995.
ADDRESSES: Inquiries should be sent to the Office of the Assistant
Secretary of Defense for Economic Security, Room 1D760, The Pentagon,
Washington, DC 20301-3300; email: base__reuse@acq.osd.mil
FOR FURTHER INFORMATION CONTACT:
Robert Hertzfeld, telephone (703) 695-1470; email: hertzfre@acq.osd.mil
SUPPLEMENTARY INFORMATION:
Background
On April 6, 1994, the Office of the Secretary of Defense published
an Interim Final Rule (59 FR 16123) that changed the process for
disposing of real and personal property at closing and realigning
military bases. Four outreach seminars (in Washington, DC, Chicago,
Dallas, and San Francisco) and a public hearing (in Washington, D.C.)
were held between April 28, 1994, and August 15, 1994, to explain the
Interim Final Rule and foster public comments.
On October 26, 1994, the Office of the Secretary of Defense amended
the Interim Final Rule (59 FR 53735). That amendment amended the
previous guidance on ``jobs-centered property disposal'', clarified the
procedures for applying for an economic development conveyance, and
provided guidance for greater flexibility on the compensation to the
federal government for real property conveyed under an economic
development conveyance.
On October 25, 1994, the Congress enacted the Base Closure
Community Redevelopment and Homeless Assistance Act of 1994 (Pub. L.
103-421). That Act exempts certain base closure property from the
procedures contained in the Stewart B. McKinney Homeless Assistance Act
(42 U.S.C. 11301) and creates a new process for the federal government
and local communities affected by base closure to address the needs of
the homeless. This publication does not provide guidance on the
substantial changes made by Public Law 103-421, which will be addressed
in a publication of the Departments of Defense and Housing and Urban
Development.
Approach
This rule marks another step in the Department of Defense's effort
to improve the base closure and reuse process. The rulemaking process
was an open one, in which Department personnel sought advice from
individuals and organizations involved in the reuse process at a public
hearing, at outreach seminars, at conferences, and through written
public comments.
In order to encourage the rapid disposal and reuse of base closure
property, the Department has been working to improve its process
towards one that:
Is based, to the greatest extent possible, on a
comprehensive, community-based planning process;
Encourages formation of and reliance upon local reuse
authorities;
Is targeted towards community needs generated from the
closure of the installation; and,
Allows for common sense decisions by the implementors.
To achieve these goals, the Department developed regulations and
policies around three key themes:
Consultation. The Military Department and the Local
Redevelopment Authority should be in
[[Page 37338]]
constant contact throughout the base closure and reuse process.
Problems can be avoided through consultation.
Partnering. The Military Departments and LRAs should work
together honestly and with full disclosure. Their efforts should be
coordinated to minimize duplicative efforts and avoid
misunderstandings. Mutual goals can be achieved between parties that
treat each other as partners, not adversaries.
Flexibility. To maximize flexibility and allow for site-
specific solutions, these regulations have been generally limited to
those provisions required by law, as well as those that affect other
federal agencies. Discretion has been left, where possible, for
solutions that are most appropriate for a given installation.
These regulations reflect the Administration's effort to create a
flexible process that works better and costs less. Regulations which
are intended to cover all situations straight jacket federal employees
and confuse the public. In order to maintain flexibility while
providing guidance, the Office of the Secretary of Defense prepared a
Base Reuse Implementation Manual for use by the Military Departments.
The Manual, which provides greater detail about the issues addressed in
this part, is available to Local Redevelopment Authorities and other
interested parties. Copies will be available, at cost, from the
National Technical Information Service, 5285 Port Royal Road,
Springfield, VA 22161.
Overview of changes
What has changed in the section on the identification of
interests (``screening'') in real property?
The timetables for federal screening have been clarified
and shortened.
The review criteria have been clearly articulated.
What has changed in the leasing procedures?
The differences between interim and long-term leases have
been clarified.
The term of interim leases have been clarified. These
leases can now last for up to five years, including options to renew.
A termination-at will clause is no longer required.
If property is leased for less than fair market value and
the lease permits the property to be sublet, the rents from the
subleases must be applied to the protection, maintenance, repair,
improvement, and costs related to the property.
What has changed in the handling of personal property?
The regulation has been revised to require the Military
Departments to:
Provide a comprehensive inventory list to the Local
Redevelopment Authority.
Consult with the Local Redevelopment Authority before
establishing the deadlines for removing equipment from the closing
base.
Prohibit the transfer of ordinary fixtures unless not
required for redevelopment.
Permit the transfer of other personal property required
for Military Department use when the LRA objects, only if the transfer
is approved by an Assistant Secretary of the Military Department.
Consult with the redevelopment authority before offering
it a suitable substitute for property being removed.
Two procedures for transfers of personal property not
related to real property have been created.
What has changed regarding Economic Development
Conveyances?
Valuation terms have been clarified.
The requirement for an excess profits clause has been
removed.
What has changed in the section on maintenance, utilities,
and services?
DoD clarified the procedures for determining the initial
levels of maintenance to encourage quick reuse and specified the time
periods for which the Military Departments will sustain the initial
levels of maintenance. The time periods are now greater than the legal
minimums, and the Secretaries of the Military Departments may extend
them (under specific circumstances).
Discussion of Public Comments and Changes
In response to the April 6, 1994, publication of the Interim Final
Rule in the Federal Register, DoD received comments from 126 separate
sources, consisting of redevelopment authorities and local governments,
State and regional governments, public and private organizations,
federal departments and agencies, members of Congress, and individuals.
Almost half of these comments were addressed when the Interim Final
Rule was amended (59 FR 53735, October 26, 1994). This amendment
removed Sec. 91.7(d), ``Jobs-Centered Property Disposal,'' and revised
Secs. 91.7(e), ``economic development conveyance,'' and 91.7(f),
``Profit Sharing.''
The response to the remainder of the comments is divided into
sections corresponding to the regulation.
Identification of Interests in Real Property
The public comments regarding real property screening spanned two
sections of the Interim Final Rule: real property screening and
McKinney Act screening.
Federal agency priority. Several federal entities
suggested that DoD Components and federal agencies have an un-
questioned right to property.
RESPONSE: DoD specified time tables and requirements that federal
agencies must follow to claim base closure property under the priority
accorded to them by the Federal Property and Administrative Services
Act of 1949. If the agencies meet these strict requirements within the
given time tables, their request will be considered prior to others.
However, DoD remains committed to promoting economic recovery and rapid
job creation in the communities adversely affected by base closures,
while still ensuring that federal resources are available for other
important public uses. To carry out those dual responsibilities, DoD
must maintain the flexibility to determine the highest and best use for
the property.
Fair Market Value. Other federal agencies suggested
waiving the requirement for federal agencies to pay fair market value
for the property.
RESPONSE: DoD will continue to follow current federal policies (41
CFR 101-47.203-7(f)(2)) that require federal agencies to pay fair
market value to DoD for its property, unless specifically granted an
exemption by the Office of Management and Budget.
Timetables. Many comments suggested clarifying timetables
for federal screening and for submitting applications for the property
to the Military Departments.
RESPONSE: DoD revised the rule in response to these requests.
Native American interests. Several comments requested
clarification regarding Native American tribes' participation in the
screening process.
RESPONSE: Native American interests can be addressed at two points
in the screening process. First, Native American tribes can submit
expressions of interest to the Bureau of Indian Affairs (BIA), which is
held to the same tight timetables and criteria as other federal
agencies. Interested Native American tribes should contact BIA for
information about its policy for expressions of interest.
Alternatively, tribal governments may participate in the local
comprehensive planning process and express their interests to the LRA.
Tribes adversely affected by the base closure should be part of the LRA
and should work within this process to see that their needs are
addressed through a single, comprehensive plan.
Local control over the planning process. Comments from
non-federal
[[Page 37339]]
sources criticized the Interim Final Rule for not giving redevelopment
authorities sufficient control over redevelopment and disposal
planning. Their comments focused on the timing for the screening of
property with federal agencies and homeless assistance providers and
the need for coordination between applicants for property and
redevelopment authorities.
RESPONSE: As part of DoD's response to the public comments, the
Department worked with other federal agencies to assist the Congress in
enacting the Base Closure Community Redevelopment and Homeless
Assistance Act of 1994. This law (Pub. L. 103-421) significantly
altered the screening process. The changes stemming from this
legislation will be implemented in a publication by the Departments of
Defense and Housing and Urban Development.
Local Redevelopment Planning
The public comments regarding the local redevelopment plan section
of the Interim Final Rule were primarily editorial, reflecting concern
that this section of the regulation was unclear.
RESPONSE: DoD responded to those comments by clarifying the process
in the section on economic development conveyances. DoD also published
the ``Community Guide to Base Reuse,'' an Office of Economic Adjustment
booklet that contains an overview of the reuse planning process. To
obtain a copy, contact the Office of Economic Adjustment, 400 Army Navy
Drive, Suite 200, Arlington, VA 22202-2884; (703) 604-6131; email:
base__reuse@acq.osd.mil.
Leasing of Real Property
The public comments concerning the Interim Final Rule on the
leasing of real property focused primarily on five areas:
Clarify the term of interim leases.
RESPONSE: The Department responded to these concerns by specifying
that a lease may be for up to five years, including options to renew,
when it is entered into prior to completion of final disposal decisions
under the National Environmental Policy Act (NEPA) process. DoD also
specified that the term of a lease entered into after completion of the
final disposal decisions under the NEPA process (a lease in furtherance
of conveyance) may be longer than five years. In addition, the Military
Departments have historically included a termination-at-will clause in
lease documents that would allow the Military Department to terminate
the lease if the property was ever needed for military purposes. This
practice is no longer required.
Reconcile differing leasing practices among the Military
Departments. Comments in this area expressed the concern that the
differing practices led to inconsistent and unequal treatment. Examples
of inconsistencies cited included the lack of standard procedures,
differing termination provisions, and inconsistent policies on
obtaining insurance for the property.
RESPONSE: The Department of Defense responded to these concerns by
developing a uniform policy for the Military Departments to follow.
Thus, the DoD Base Reuse Implementation Manual, intended primarily for
Service implementors, includes a sample lease application package, and
a sample review checklist. Model lease provisions, which will generally
be used by the Military Departments, are also included in this manual.
DoD believes that these improvements will foster a more consistent
approach and quicker response to lease applicants.
Clarify the consideration required for interim leases.
RESPONSE: In response to the comments about consideration, DoD
reiterated in the rule that property could be leased for less than fair
market value if the Secretary of the Military Department determines
that a public interest is served as a result of the lease and the fair
market value of the lease is either unobtainable or not compatible with
the public benefit that would be served.
Clarify the policy on subleasing.
RESPONSE: DoD revised the rule to specify that if the property is
leased for less than fair market value and the lease permits the
property to be sublet, the rents from the subleases must be applied to
the protection, maintenance, repair, improvement, and costs related to
the property.
Improve the leasing process, shortening the time it takes
to conclude a lease agreement. Comments in this area suggested that DoD
should expedite its environmental review process, establish deadlines
for the Military Departments to respond to leasing requests, and
delegate authority to grant interim leases to relatively low levels of
authority within the Departments.
RESPONSE: DoD is convinced that all of the improvements mentioned
above will improve and accelerate the leasing process. Additionally,
DoD will continue to seek other ways to improve the process. For
example, DoD continues to review its environmental review procedures to
hasten that process while ensuring compliance with all pertinent laws
and regulations. Also, DoD has created a tri-Service team to identify
additional opportunities for improvement of the leasing process. In the
meantime, the Military Departments will be encouraged to delegate
leasing authority to the level that can best respond to local needs and
still ensure compliance with statutory and regulatory requirements.
Personal Property
The public comments concerning the personal property section of the
Interim Final Rule concentrated on six areas. Procedures for trading
emission reduction credits are not addressed in this rule. A discussion
on this subject is contained in the DoD Base Reuse Implementation
Manual.
Provide the LRA with a complete inventory. From the
comments, DoD recognized that providing the redevelopment authority
with an incomplete inventory list left the impression that the Military
Departments were trying to hide property from the community.
RESPONSE: To counter that impression and promote trust and
confidence between the Military Departments and Local Redevelopment
Authorities, DoD revised the rule to require the Military Departments
to provide a complete inventory list to the redevelopment authority.
Deadlines. DoD recognized from the comments that the
strict deadlines for removing equipment could leave the communities
with the impression that Military Departments would be insensitive to
the special needs of the community.
RESPONSE: DoD revised the rule to require the Military Departments
to consult with the redevelopment authority before establishing
deadlines for removing equipment from the closing base.
Redistribution. Comments in this area criticized DoD for
giving the Military Departments and the federal government priority for
the personal property over the Local Redevelopment Authority,
especially for those items that were not uniquely military. These
submissions contended that if the communities needed the personal
property for redevelopment purposes, they should have priority for it,
since the Department's base closures created the need for
redevelopment.
On the other hand, others contended that the Military Departments'
authority to redistribute property had been unduly restricted. They
asked that the Military Departments be given top priority for non-
military items needed at another installation.
[[Page 37340]]
RESPONSE: DoD has struck a balance between these concerns. Personal
property, except ordinary fixtures, required by the Military Department
for the operation of transferring unit, function, component, weapon, or
weapon systems may be removed upon approval of the base commander or
higher authority. Other personal property, except ordinary fixtures,
required by the Military Department for the operation of a unit,
function, component, weapon, or weapon systems at another installation
will be subject to consultation with the community. Where the community
disputes a transfer, the approval by an Assistant Secretary of the
Military Department will be required.
Substitutions. Several comments criticized the provision
that allowed the Military Departments to provide the redevelopment
authority with substitute equipment instead of the actual item
requested. They were concerned that the communities would get stuck
with older, inferior equipment.
RESPONSE: DoD revised the rule to require the Military Departments
and Defense Agencies to consult with the Local Redevelopment Authority
before offering it a suitable substitute.
Complaints. Some comments objected to the dispute
resolution process. They suggested that DoD should establish another
mechanism for resolving disputes--ideally one outside the purview of
the agency that made the initial decision.
RESPONSE: While DoD struck the appeal provision from the rule, it
will continue to direct the Military Departments to use the chain-of-
command to address complaints.
Conveyances of personal property not related to real
property. The remainder of the comments expressed concern over the
apparent lack of guidance for conveying personal property that is not
associated with a real property transfer to the redevelopment
authority. In particular, they wanted to know if a community could
obtain individual items of personal property directly from the closing
base, and, if so, how.
RESPONSE: DoD revised the rule to identify two procedures for
conveying personal property (exclusive of real property) from a closing
base to a Local Redevelopment Authority.
Maintenance, Utilities, and Services
The public comments concerning the levels of maintenance and repair
section of the Interim Final Rule concentrated primarily on how the
Military Departments would determine initial levels of maintenance and
repair and how long they would maintain those levels, and expressed a
concern that the Military Departments would abandon the property if it
was not disposed of before the period of initial maintenance and repair
lapsed.
RESPONSES:
General response: DoD concluded that most of the public
comments were based on misperceptions. For example, some feared that
the levels of maintenance would be inadequate to preserve the property
and that the Military Departments would discontinue maintaining the
property after a specific date. To counter these misperceptions, DoD
clarified the procedures for determining the initial levels of
maintenance. DoD also encouraged the Military Departments to consult
with the Local Redevelopment Authorities in making decisions on the
initial levels of maintenance.
Duration of initial levels of maintenance. The revised
rule also identifies the time periods for which the Military
Departments will sustain the initial levels of maintenance and repair.
Not only may the Secretaries of the Military Departments extend the
periods (under specific circumstances), but the time periods are now
greater than those periods required by law.
Abandonment. DoD specified in the rule that after the
period of the initial levels of maintenance and repair lapses, the
degree of maintenance and repair would revert to not less than those
levels consistent with federal government standards for excess and
surplus property. However, the levels of maintenance and repair may be
lower than the initial levels.
Historic preservation. Some submissions expressed concern
that the regulation does not specifically require the Military
Departments to consult with state historic preservation officers or the
Advisory Council on Historic Preservation before determining the
initial levels of maintenance and repair. DoD recognizes that Defense
and federal regulations implementing Section 106 of the National
Historic Preservation Act already require the Military Departments to
consult with historic preservation activities about preserving historic
property at closing military bases and so chose not to complicate the
process by addressing the issue in this rule.
General Comments on April 6, 1994, Interim Final Rule
The general comments offered advice on implementing the Interim
Final Rule, rather than the content of the Interim Final Rule. In
response to these general comments, the Office of the Secretary of
Defense prepared a Department of Defense Base Reuse Implementation
Manual to provide greater detail and offer examples of how this rule
will be implemented.
Response to public comments on Economic Development Conveyances
The Department received comments on the October 26, 1994, amendment
to the Interim Final Rule (59 FR 53735). Many comments were supportive
of the changes made, but did suggest some technical revisions. Other
comments included:
Standardize terms.
RESPONSE: The term ``present fair market value'' has been used
throughout to avoid confusion.
Specify how much land should be applied for, and when.
RESPONSE: Since the submissions did not provide a powerful
justification for limiting the flexibility of implementors, the
Department decided not to accept this recommendation.
Require arbitration if an agreement on compensation cannot
be reached.
RESPONSE: The statute requires the Military Department, rather than
an arbitrator, to decide what compensation will be. In addition, DoD
does not believe such a provision is necessary because it is committed
to working with communities to assist them with economic redevelopment.
Change the definition of rural.
RESPONSE: The Department did not feel it necessary to change the
definition, because any community that shows a need for a discount can
receive one under the new process. The possibility to receive property
at no cost exists at urban and rural sites, if the property is
determined not to have a positive present fair market value and/or if a
100% discount is determined to be necessary for job creation.
Executive Order 12866
It has been determined that this final rule is not a significant
regulatory action. The final rule raises novel policy issues arising
out of the President's priorities.
Regulatory Flexibility Act
It has been determined that this rule will not have a significant
economic impact on substantial number of small entities. The primary
effect of this rule will be to help base closure communities by
reducing the burden of the government's property disposal process on
them and to accelerate the economic recovery of the relatively small
number of communities that will be affected by the closure or
realignment of a military installation.
[[Page 37341]]
Paperwork Reduction Act
The rule is not subject to the Paperwork Reduction Act because it
imposes no obligatory information requirements beyond internal
Department of Defense use.
List of Subjects in 32 CFR Parts 90 and 91
Community development, Government employees, Military personnel,
Surplus government property.
Accordingly, 32 CFR parts 90 and 91 are revised as follows:
PART 90--REVITALIZING BASE CLOSURE COMMUNITIES
Sec.
90.1 Purpose.
90.2 Applicability.
90.3 Definitions.
90.4 Policy.
90.5 Responsibilites.
Authority: 10 U.S.C. 2687 note.
Sec. 90.1 Purpose.
This part:
(a) Establishes policy and assigns responsibilities under the
President's Five-Part Plan, ``A Program to Revitalize Base Closure
Communities,'' July 2, 1993,\1\ to speed the economic recovery of
communities where military bases are slated to close.
\1\ Available from the Office of the Assistant Secretary of
Defense, The Pentagon, Room 1D760, Washington, DC 20301-3300; email:
``base__reuse@acq.osd.mil''
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(b) Implements 107 Stat. 1909, National Defense Authorization Act
for Fiscal Year 1994, Title XXIX and The Base Closure Community
Redevelopment and Homeless Assistance Act of 1994 (Pub. L. 103-421).
(c) Authorizes the publication of DoD 4165.66-M, ``Base Reuse
Implementation Manual,'' in accordance with DoD 5025.1-M, ``DoD
Directive System Procedures,'' August 1994.
Sec. 90.2 Applicability.
This part applies to the Office of the Secretary of Defense, the
Military Departments, the Chairman of the Joint Chiefs of Staff, the
Unified Combatant Commands, the Defense Agencies, and the DoD Field
Activities (hereafter referred to collectively as ``the DoD
Components'').
Sec. 90.3 Definitions.
(a) Closure. All missions of the installation have ceased or have
been relocated. All personnel positions (military, civilian and
contractor) have either been eliminated or relocated, except for
personnel required for caretaking, conducting any ongoing environmental
cleanup, and disposal of the base, or personnel remaining in authorized
enclaves.
(b) Relaignment. Any action that both reduces and relocates
functions and DoD civilian personnel positions, but does not include a
reduction in force resulting from workload adjustments, reduced
personnel or funding levels, skill imbalances, or other similar cause.
A realignment may terminate the DoD requirement for the land and
facilities on part of an installation. That part of the installation
shall be treated as ``closed'' for purposes of this part.
Sec. 90.4 Policy.
It is DoD policy to:
(a) Help communities impacted by base closures and realignments
achieve rapid economic recovery through effective reuse of the assets
of closing and realigning bases--more quickly, more effectively and in
ways based on local market conditions and locally developed reuse
plans. This will be accomplished by quickly insuring that communities
and the Military Departments communicate effectively and work together
to accomplish mutual goals of quick property disposal and rapid job
generation.
(b) This part does not create any rights or remedies and may not be
relied upon by any person, organization, or other entity to allege a
denial of any rights or remedies other than those provided by Title
XXIX of Pub. L. 103-160, or Pub. L. 103-421.
Sec. 90.5 Responsibilities.
(a) The Under Secretary of Defense for Acquisition and Technology
shall issue DoD Instructions as necessary, to further implement
applicable public laws effecting base closure implementation, and shall
monitor compliance with this part. All authorities of the Secretary of
Defense in Public Law 103-421 (108 Stat. 4326 et. seq.); Public Law
103-160, Title XXIX (107 Stat. 1909 et. seq.); Public Law 101-510,
Section 2905 (104 Stat. 1813 et. seq.); and Public Law 100-526, Section
204 (102 Stat. 2627 et. seq.), are hereby delegated to the Assistant
Secretary of Defense for Economic Security and may be delegated
further.
(b) The Heads of the DoD Components shall advise their personnel
with responsibilities related to base closures of the policies set
forth in this part.
PART 91--REVITALIZING BASE CLOSURE COMMUNITIES--BASE CLOSURE
COMMUNITY ASSISTANCE
Sec.
91.1 Purpose.
91.2 Applicability.
91.3 Definitions.
91.4 Policy.
91.5 Responsibilities.
91.6 Delegations of authority.
91.7 Procedures.
Authority: 10 U.S.C. 2687 note.
Sec. 91.1 Purpose.
This part prescribes procedures to implement ``Revitalizing Base
Closure Communities'' (32 CFR part 90), the President's five-part
community reinvestment program, and real and personal property disposal
to assist the economic recovery of communities impacted by base
closures and realignments. The expeditious disposal of real and
personal property will help communities get started with reuse early
and is therefore critical to timely economic recovery.
Sec. 91.2 Applicability.
This part applies to the Office of the Secretary of Defense, the
Military Departments, the Chairman of the Joint Chiefs of Staff, the
United Combatant Commands, the Defense Agencies, and the DoD Field
Activities (hereafter referred to collectively as ``the DoD
Components'').
Sec. 91.3 Definitions.
(a) Base Closure Law. The provisions of Title II of the Defense
Authorization Amendments and Base Closure Realignment Act (Pub. L. 100-
526, 102 Stat. 2623, 10 U.S.C. 2687 note), or the Defense Base Closure
and Realignment Act of 1990 (Pub. L. 101-510, Part A of Title XXIX of
104 Stat. 1808, 10 U.S.C. 2687 note).
(b) Closure. All missions of the installation have ceased or have
been relocated. All personnel positions (military, civilian, and
contractor) have either been eliminated or relocated, except for
personnel required for caretaking, conducting any ongoing environmental
cleanup, and disposal of the base, or personnel remaining in authorized
enclaves.
(c) Consultation. Explaining and discussing an issue, considering
objections, modifications, and alternatives; but without a requirement
to reach agreement.
(d) Date of approval. The date on which the authority of Congress
to disapprove Defense Base Closure and Realignment Commission
recommendations for closures or realignments of installations expires
[[Page 37342]]
under Title XXIX of 104 Stat. 1808, as amended.
(e) Excess property. Any property under the control of a Military
Department that the Secretary concerned determines is not required for
the needs of the Department of Defense.
(f) Realignment. Any action that both reduces and relocates
functions and DoD civilian personnel positions, but does not include a
reduction in force resulting from workload adjustments, reduced
personnel or funding levels, skill imbalances, or other similar cause.
A realignment may terminate the DoD requirement for the land and
facilities on part of an installation. That part of the installation
shall be treated as ``closed'' for this document.
(g) Local Redevelopment Authority (LRA). Any authority or
instrumentality established by state or local government and recognized
by the Secretary of Defense, through the Office of Economic Adjustment,
as the entity responsible for developing the redevelopment plan with
respect to the installation or for directing implementation of the
plan.
(h) Rural. An area outside a Metropolitan Statistical Area.
(i) Surplus property. Any excess property not required for the
needs and the discharge of the responsibilities of federal agencies.
Authority to make this determination, after screening with all federal
agencies, rests with the Military Departments.
(j) Communities in the Vicinity of the Installation. The
communities that constitute the political jurisdictions (other than the
State in which the installation is located) that comprise the
redevelopment authority for the installation.
(k) Installation. A base, camp, post, station, yard, center,
homeport facility for any ship, or other activity under the
jurisdiction of the Department of Defense, including any leased
facility. Such term does not include any facility used primarily for
civil works, rivers, and harbors projects, flood control, or other
project not under the primary jurisdiction or control of the Department
of Defense.
Sec. 91.4 Policy.
It is DoD policy to help communities impacted by base closures and
realignments achieve rapid economic recovery through effective reuse of
the assets of closing and realigning bases--more quickly, more
effectively and in ways based on local market conditions and locally
developed reuse plans. This will be accomplished by quickly ensuring
that communities and the Military Departments communicate effectively
and work together to accomplish mutual goals of quick property disposal
and rapid job generation. This regulation does not create any rights or
remedies and may not be relied upon by any person, organization, or
other entity to allege a denial of any rights or remedies other than
those provided by Title XXIX of Public Law 103-160, or Public Law 103-
421.
Sec. 91.5 Responsibilities.
(a) The Assistant Secretary of Defense for Economic Security, after
coordination with the General Counsel of the Department of Defense and
other officials as appropriate, may issue such guidance and
instructions through the publication of a manual or other such guidance
as may be necessary to implement Laws, Directives and Instructions on
the retention or disposal of real and personal property at closing or
realigning bases.
(b) The Heads of the DoD Components shall ensure compliance with
this part and guidance issued by the Assistant Secretary of Defense for
Economic Security on revitalizing base closure communities.
Sec. 91.6 Delegations of authority.
(a) The authority provided by sections 202 and 203 of the Federal
Property and Administrative Services Act of 1949, as amended (40 U.S.C.
483 and 484) for the utilization and disposal of excess and surplus
property at closing and realigning bases has been delegated by the
Administrator, GSA, to the Secretary of Defense by delegations dated
March 1, 1989; October 9, 1990; and, September 13, 1991.\2\ Authority
under these delegations has been previously delegated to the
Secretaries of the Military Departments, who may delegate this
authority further.
\2\ Available from the Office of the Assistant Secretary of
Defense (Economic Security), The Pentagon, Room 1D760, Washington,
DC 20301-3300; e mail: base__reuse@acq.osd.mil
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(b) Authorities delegated to the Assistant Secretary of Defense for
Economic Security by Sec. 90.5 of this chapter are hereby redelegated
to the Secretaries of the Military Departments, unless otherwise
provided within this part or other DoD directive, instruction, manual
or regulation. These authorities may be delegated further.
Sec. 91.7 Procedures.
(a) Identification of interest in real property. (1) To speed the
economy recovery of communities affected by closures and realignments,
it is DoD policy to identify DoD and federal interests in real property
at closing and realigning military bases as quickly as possible. The
Military Department having responsibility for the closing or realigning
base shall identify such interests. The Military Department will keep
the Local Redevelopment Authority (LRA) informed of these interests.
This section establishes a uniform process, with specified timelines,
for identifying real property which is excess to the Military
Department for use by other Departments of Defense (DoD) Components and
other federal agencies, and for the disposal of surplus property for
various purposes.
(2) Upon the President's submission of the recommendations for base
closures and realignments to the Congress in accordance with the
Defense Base Closure and Realignment Act of 1990 (Pub. L. 101-510), the
Military Department shall send out a notice of potential availability
to the other DoD Components, and other federal agencies. The notice of
potential availability is a public document and should be made
available in a timely basis, upon request. Federal agencies are
encouraged to review this list, and to evaluate whether they may have a
requirement for the listed properties. The notice of potential
availability should describe the property and buildings that may be
available for transfer. Installations which wholly or in part are
comprised of withdrawn and reserved public domain lands should
implement paragraph (a)(12) of this section at the same time.
(3) Military Departments should consider LRA input in making
determinations on the retention of property (size of cantonment area),
if provided. Generally, determinations on the retention of property (or
size of the cantonment area) should be completed prior to the date of
approval of the closure or realignment.
(4) Within one week of the date of approval of the closure or
realignment, the Military Department shall issue a formal notice of
availability to other DoD Components and federal agencies covering
closing and realigning installation buildings and property available
for transfer to other DoD Components and federal agencies. Withdrawn
public domain lands, which the Secretary of the Interior has determined
are suitable for return to his jurisdiction, will not be included in
the notice of availability.
(5) Within 30 days of date of the notice of availability, any DoD
Component or federal agency is required to provide a written, firm
expression of interest for buildings and property. An expression of
interest must explain the
[[Page 37343]]
intended use and the corresponding requirement for the buildings and
property.
(6) Within 60 days of the date of the notice of availability, the
DoD Component or federal agency expressing interest in buildings or
property must submit an application for transfer of such property to
the Military Department or federal agency.
(i) Within 90 days of the notice of availability, the FAA should
survey the air traffic control and air navigation equipment at the
installation to determine what is needed to support the air traffic
control, surveillance, and communications functions supported by the
Military Department, and to identify the facilities needed to support
the National Airspace System. FAA requests for property to manage the
National Airspace System will not be governed by paragraph (a)(9) of
this section. Instead, such requests will be governed by the
requirements of 41 CFR 101-47.308-2, to determine the transfer of
property necessary for control of the airspace being relinquished by
the Military Department.
(7) The Military Department will keep the LRA informed of the
progress in identifying interests. At the same time, the LRA is
encouraged to contact federal agencies which sponsor public benefit
transfers for information and technical assistance. The Military
Department will provide points of contact at the federal agencies to
the LRA.
(8) Federal agencies and DoD Components are encouraged to discuss
their plans and needs with the LRA, if an LRA exists. DoD Components
and federal agencies are encouraged to notify the Military Department
of the results of this non-binding consultation. The Military
Departments, the Base Transition Coordinator, and the Office of
Economic Adjustment Project Manager are available to help facilitate
communication between the federal agencies, DoD Components, and the
LRA.
(9) A request for property from a DoD Component or federal agency
must contain the following information:
(i) A completed GSA Form 1334, Request for Transfer (for requests
from other DoD Components a DD Form 1354 is required). This must be
signed by the head of the Component of the Department or Agency
requesting the property. If the authority to acquire property has been
delegation, a copy of the delegation must accompany the form;
(ii) A statement from the head of the requesting Component or
agency that the request does not establish a new program (i.e., one
that has never been reflected in a previous budget submission or
Congressional action);
(iii) A statement that the requesting Component or agency has
reviewed its real property holdings and cannot satisfy this requirement
with existing property. This review must include all property under the
requester's accountability, including permits to other federal agencies
and outleases to other organizations;
(iv) A statement that the requested property would provide greater
long-term economic benefits than acquisition of a new facility or other
property for the program;
(v) A statement that the program for which the property is
requested has long-term viability;
(vi) A statement that considerations of design, layout, geographic
location, age, state of repair, and expected maintenance costs of the
requested property clearly demonstrate that the transfer will prove
more economical over a sustained period of time than acquiring a new
facility;
(vii) A statement that the size of the property requested is
consistent with the actual requirement;
(viii) A statement that fair market value reimbursement to the
Military Department will be made within two years of the initial
request for the property, unless this obligation is waived by the
Office of Management and Budget and the Secretary of the Military
Department or a public law specifically provides for a non-reimbursable
transfer. However, requests from the Military Departments or DoD
Components do not need an Office of Management and Budget waiver; and
(ix) A statement that the requesting DoD Component or federal
agency agrees to accept the care and custody costs for the property on
the date the property is available for transfer, as determined by the
Military Department.
(10) The Military Department will make it decision on a request
from a federal agency, Military Department, or DoD Component based upon
the following factors, from the Federal Property Management Regulations
(41 CFR 101-47.201-2):
(i) The paramount consideration shall be the validity and
appropriateness of the requirement upon which the proposal is based;
(ii) The proposed federal use is consistent with the highest and
best use of the property;
(iii) The requested transfer will not have an adverse impact on the
transfer of any remaining portion of the base;
(iv) The proposed transfer will not establish a new program or
substantially increase the level of an agency's existing programs;
(v) The application offers fair market value for the property,
unless waived;
(vi) The proposed transfer addresses applicable environmental
responsibilities to the satisfaction of the Military Department; and
(vii) The proposed transfer is in the best interest of the
Government.
(11) When there are more than one acceptable applications for the
same building or property, the Military Department responsible for the
installation should first consider the needs of the military to carry
out its mission. The Military Department should then consider the
proposal's economic development and job creation potential and the
LRA's comments, as well as the other factors in the determination of
highest and best use.
(12) Closing or realigning installations may contain ``public
domain lands'' which have been withdrawn by the Secretary of the
Interior from operation of the public land laws and reserved for the
Defense Department's use. Lands deemed suitable for return to the
public domain are not real property governed by the Federal Property
and Administrative Services Act of 1949, as amended (40 U.S.C. 472),
and are not governed by the property management and disposal provisions
of the Base Closure and Realignment Act of 1988 (Pub. L. 100-526) and
Defense Base Closure and Realignment Act of 1990 (Pub. L. 101-510).
Public domain lands are under the jurisdiction of the Secretary of the
Interior and administered by the Bureau of Land Management (BLM) unless
the Secretary of the Interior has withdrawn the lands and reserved them
for another federal agency's use.
(i) The Military Department responsible for a closing or realigning
installation will provide the BLM with the notice of potential
availability, as well as information about which, if any, public domain
lands will be affected by the installation's closing.
(ii) The BLM will review the notice of potential availability to
determine if any installations contain withdrawn public domain lands.
Before the date of approval of the closure or realignment, the BLM will
review its land records to identify any withdrawn public domain lands
at the closing installations. Any records discrepancies between the BLM
and Military Departments should be resolved within this time period.
The BLM will notify the Military Departments as to the final agreed
upon withdrawn and reserved public domain lands at installations.
[[Page 37344]]
(iii) Upon agreement as to what withdrawn and reserved public
domain lands are affected at closing installations, the BLM will
initiate a screening of DOI agencies to determine if these lands are
suitable for programs of the Secretary of the Interior.
(iv) Military Departments will transmit a Notice of Intent to
Relinquish (see 43 CFR part 2372) to the BLM as soon as it is known
that there is no DoD Component interest in reusing the public domain
lands. The BLM will complete the suitability determination screening
process within 30 days of receipt of the Military Department's Notice
of Intent to Relinquish. If a DoD Component is approved to reuse the
public domain lands, the BLM will be notified and BLM will determine if
the current authority for military use of these lands needs to be
modified/amended.
(v) If BLM determines the land is suitable for return, they shall
notify the Military Department that the intent of the Secretary of the
Interior is to accept the relinquishment of the Military Department.
(vi) If BLM determines the land is not suitable, the land should be
disposed of pursuant to base closure law.
(13) The Military Department should make its surplus determination
within 100 days of the issuance of the notice of availability, and
shall inform the LRA of the determination. If requested by the LRA, the
Military Department may postpone the surplus determination for a period
of no more than six months after the date of approval of the closure of
realignment.
(i) In unusual circumstances, extensions beyond six months can be
granted by the Assistant Secretary of Defense of Economic Security.
(ii) Extensions of the surplus determination should be limited to
the portions of the installation where there is an outstanding
interest, and every effort should be made to make decisions on as much
of the installation as possible, within the specified timeframes.
(14) Once the surplus determination has been made, the Military
Department shall:
(i) Follow the procedures outlined in paragraph (b) of this
section, if applicable.
(ii) Or, for installations approved for closure or realignment
after October 25, 1994, and installations approved for closure or
realignment prior to October 25, 1994, that have elected, prior to
December 24, 1994, to come under the process outlined in the Base
Closure Community Redevelopment and Homeless Assistance Act of 1994,
follow the procedures outlined in paragraph (c) of this section.
(15) Following the surplus determination, but prior to the disposal
of property, the Military Department may, at its discretion, withdraw
the surplus determination and evaluate a federal agency's late request
for excess property.
(i) Transfers under this paragraph shall be limited to special
cases, as determined by the Secretary of the Military Department.
(ii) Requests shall be made to the Military Department, as
specified under paragraphs (a)(8) and (a)(9) of this section, and the
Military Department shall notify the LRA of such late request.
(iii) Comments received from the LRA and the time and effort
invested by the LRA in the planning process should be considered when
the Military Department is reviewing a late request.
(b) Homeless screening for properties not covered by the Base
Closure Community Redevelopment and Homeless Assistance Act of 1994.
(1) This section outlines the procedure created for the identification
of real property to fulfill the needs of the homeless by section
2905(b)(6) of Pub. L. 101-510, as amended by Public Law 103-160
(referred to as the Pryor Amendment). It applies to BRAC 88, 91 and 93
bases if the LRA did not elect to be subject to the alternate homeless
assistance screening procedure contained in the Base Closure Community
Redevelopment and Homeless Assistance Act of 1994.
(2) The Military Department shall sponsor a workshop or seminar in
the communities which have closing or realigning bases, unless such a
workshop or seminar has already been held. These workshops or seminars
will be conducted prior to the Federal Register publication by HUD of
available property to assist the homeless.
(i) Not later than the date upon which the determination of surplus
is made, the Military Department shall complete any determinations or
surveys necessary to determine whether any building is available to
assist the homeless. The Military Department shall then submit the list
of properties available to assist the homeless to HUD.
(ii) HUD shall make a determination of the suitability of each
property to assist the homeless in accordance with the Stewart B.
McKinney Homeless Assistance Act, 42 U.S.C. 11411, (the McKinney Act).
Within 60 days from the date of receipt of the information from the
Department of Defense, HUD shall publish a list of suitable properties
that shall become available when the base closes or realigns.
(iii) The listing of properties in the Federal Register under this
procedure shall contain the following statement. (The listing of 1988
base closure properties that will be reported to HUD shall refer to
section 204(b)(6) of Public Law 100-526 instead of section 2905(b)(6)
of Public Law 101-510):
The properties contained in this listing are closing and
realigning military installations. This report is being accomplished
pursuant to section 2905(b)(6) of Public Law 101-510, as amended by
Public Law 103-160. In accordance with section 2905(b)(6), this
property is subject to a one-time publication under the McKinney Act
after which property not provided to homeless assistance providers
will not be published again unless there is no expression of
interest submitted by the local redevelopment authority in the one-
year period following the end of the McKinney screening process
pursuant to this publication.
(3) Providers of assistance to the homeless shall then have 60 days
in which to submit expressions of interest to HHS in any of the listed
properties. If a provider indicates an interest in a listed property,
it shall have an additional 90 days after submission of its written
expression of interest to submit a formal application to HHS, a period
which HHS can extend. HHS shall then have 25 days after receipt of a
completed application to review and complete all actions on such
applications.
(4) During this screening process (from 60 to 175 days following
the Federal Register publication, as appropriate), disposal agencies
shall take no final disposal action or allow reuse of property that HUD
has determined suitable and that may become available for homeless
assistance unless and until:
(i) No timely expressions of interest from providers are received
by HHS;
(ii) No timely applications from providers expressing interest are
received by HHS; or,
(iii) HHS rejects all applications received for a specific
property.
(5) The Military Department should promptly inform the affected
LRA, the Governor of the State, local governments, and agencies which
support public benefit conveyances of the date the surplus property
will be available for community reuse if:
(i) No provider expresses an interest to HHS in a property with the
allotted 60 days;
(ii) There are expressions of interest by homeless assistance
providers, but no application is received by HHS from such a provider
within the subsequent
[[Page 37345]]
90-day application period (or within the longer application period if
HHS has granted an extension); or
(iii) HHS rejects all applications for a specific property at any
time during the 25 day HHS review period.
(6) The LRA shall have 1 year from the date of notification under
paragraph (b)(5) of this section to submit a written expression of
interest to incorporate the remainder of the property into a
redevelopment plan.
(7) During the allotted 1-year period for the LRA to submit a
written expression of interest for the property, surplus properties not
already approved for homeless reuse shall not be available for homeless
assistance. The surplus properties will also not be advertised by HUD
as suitable during these 1-year periods. The surplus property may be
available for interim leases consistent with paragraph (g) of this
section.
(8) If the LRA does not express in writing its interest in a
specific property during the allotted 1-year period or it notifies the
Military Department it is not interested in the property, the disposal
agency shall again notify HUD of the date of availability of the
property for homeless assistance. HUD may then list the property in the
Federal Register as suitable and available after the base closes
following the procedures of the McKinney Act.
(c) Reserved. Additional regulations will be promulgated in a
publication of the Departments of Defense and Housing and Urban
Development to address state and local screening and approval of
redevelopment plans for installations covered by the Base Closure
Community Redevelopment and Homeless Assistance Act of 1994 (Pub. L.
103-421).
(d) Local Redevelopment Authority and the Redevelopment Plan. (1)
The LRA should have broad-based membership, including, but not limited
to, representatives from those jurisdictions with zoning authority over
the property. Generally, there will be one recognized LRA per
installation.
(2) The LRA should focus primarily on developing a comprehensive
redevelopment plan based upon local needs. The plan should recommend
land uses based upon an exploration of feasible reuse alternatives. If
applicable, the plan should consider notices of interest received under
the provisions of the Base Closure Community Redevelopment and Homeless
Assistance Act of 1994 (Pub. L. 103-421). This section shall not be
construed to require a plan that is enforceable under state and local
land use laws, nor is it intended to create any exemption from such
laws.
(3) The Military Department will develop a disposal plan and
complete the appropriate environmental documentation no later than 12
months from receipt of the redevelopment plan. The local redevelopment
plan will generally be used as the basis for the proposed action in
conducting environmental analyses required by under the National
Environmental Policy Act of 1969 (NEPA), (42 U.S.C. 4332 et seq.). The
disposal plan will specifically address the methods for disposal of
property at the installation, including conveyances for homeless
assistance, public benefit transfers, public sales, Economic
Development Conveyances and other disposal methods.
(i) In the event there is no LRA recognized by DoD and/or if a
redevelopment plan is not received from the LRA within 15 months from
the determination of surplus under paragraph (a)(13) of this section,
(unless an extension of time has been granted by the Assistant
Secretary of Defense for Economic Security), the applicable Military
Department shall proceed with the disposal of property under applicable
property disposal and environmental laws and regulations.
(e) Economic development conveyances. (1) Section 2903 of Public
Law 103-160 gives the Secretary of Defense the authority to transfer
property to local redevelopment authorities for consideration in cash
or in kind, with or without initial payment, or with only partial
payment at time of transfer, at or below the estimated present fair
market value of the property. This authority creates an additional tool
for local communities to help spur economic opportunity through a new
real property conveyance method specifically designed for economic
development, referred to as the ``Economic Development Conveyance''
(EDC).
(2) The EDC can only be used when other surplus federal property
disposal authorities for the intended land use cannot be used to
accomplish the necessary economic redevelopment.
(3) An LRA is the only entity able to receive property under an
EDC.
(4) A properly completed application will be the basis for a
decision on whether an LRA will be eligible for an EDC. An application
should be submitted by the LRA after a Redevelopment Plan is adopted by
the LRA. The Secretary of the Military Departments shall establish a
reasonable time period for submission of the EDC application after
consultation with the LRA. The Military Departments will review the
applications and make a decision whether to make an EDC based on the
criteria specified in paragraph (e)(7) of this section. The terms and
conditions of the EDC will be negotiated between the Military
Departments and the LRA. Bases in rural areas shall be conveyed with no
consideration if they meet the standards in paragraph (f)(5) of this
section.
(5) The application should explain why an EDC is necessary for
economic redevelopment and job creation. In addition to the elements in
paragraph (e)(5) of this section, after Military Department review of
the application, additional information may be requested to allow for a
better evaluation of the application. The application should also
contain the following elements:
(i) A copy of the adopted redevelopment plan.
(ii) A project narrative including the following:
(A) A general description of property requested.
(B) A description of the intended uses.
(C) A description of the economic impact of closure or realignment
on the local communities.
(D) A description of the financial condition of the community and
the prospects for redevelopment of the property.
(E) A statement of how the EDC is consistent with the overall
Redevelopment Plan.
(iii) A description of how the EDC will contribute to short- and
long-term job creation and economic redevelopment of the base and
community, including projected number, and type of new jobs it will
assist in creating.
(iv) A business/operational plan for the EDC parcel, including such
elements as:
(A) A development timetable, phasing schedule and cash flow
analysis.
(B) A market and financial feasibility analysis describing the
economic viability of the project, including an estimate of net
proceeds over a fifteen-year period, the proposed consideration or
payment to the Department of Defense, and the estimated present fair
market value of the property.
(C) A cost estimate and justification for infrastructure and other
investments needed for the development of the EDC parcel.
(D) Local investment and proposed financing strategies for the
development.
(v) A statement describing why other authorities--such as public or
negotiated sale and public benefit transfers for education, parks,
public health, aviation, historic monuments,
[[Page 37346]]
prisons, and wildlife conservation--cannot be used to accomplish the
economic development and job creation goals.
(vi) If a transfer is requested for less than the estimated present
fair market value (``FMV''), with or without initial payment at the
time of transfer, then a statement should be provided justifying the
discount. The statement should include the amount and form of the
proposed consideration, a payment schedule, the general terms and
conditions for the conveyance, and projected date of conveyance.
(vii) A statement of the LRA's legal authority to acquire and
dispose of the property.
(6) Upon receipt of an application for an EDC, the Secretary of the
Military Department will determine whether an EDC is needed to spur
economic development and job creation and examine whether the terms and
conditions proposed are fair and reasonable. The Military Department
may also consider information independent of the application, such as
views of other federal agencies, appraisals, caretaker costs and other
relevant material. The Military Department may propose and negotiate
any alternative terms or conditions that it considers necessary.
(7) The following factors will be considered, as appropriate, in
evaluating the application and the terms and conditions of the proposed
transfer, including price, time of payment and other relevant methods
of compensation to the federal government.
(i) Adverse economic impact of closure or realignment on the region
and potential for economic recovery after an EDC.
(ii) Extent of short- and long-term job generation.
(iii) Consistency with overall Redevelopment Plan.
(iv) Financial feasibility of the development, including market
analysis and need and extent of proposed infrastructure and other
investments.
(v) Extent of state and local investment, level of risk incurred,
and the LRA's ability to implement the plan.
(vi) Current local and regional real estate market conditions.
(vii) Incorporation of other federal agency interests and concerns,
and applicability of, and conflicts with, other federal surplus
property disposal authorities.
(viii) Relationship to the overall Military Department disposal
plan for the installation.
(ix) Economic benefit to the federal government, including
protection and maintenance cost savings and anticipated consideration
from the transfer.
(x) Compliance with applicable federal, state, and local laws and
regulations.
(8) Before making an EDC, the Military Department must prepare an
estimate of the present fair market value of the property, which may be
expressed as a range of values. The Military Department shall consult
with the LRA on valuation assumptions, guidelines and on instructions
given to the person(s) making the estimation of value. The Military
Department is fully responsible for completion of the valuation. The
Military Department, in preparing the estimate of present fair market
value shall include, to the extent practicable, the uses identified in
the local redevelopment plan.
(f) Consideration for economic development conveyances. (1) For
conveyances made pursuant to Sec. 91.7(e), Economic development
conveyances, the Secretary of the Military Department will review the
application for an EDC and negotiate the terms and conditions of each
transaction with the LRA. The Military Departments will have the
discretion and flexibility to enter into agreements that specify the
form, amount, and payment schedule. The consideration may be at or
below the estimated present fair market value, with or without initial
payment, in cash or in-kind and paid over time.
(2) An EDC must be one of the two following types of agreements:
(i) Consideration within the estimated range of present fair market
value, as determined by the Secretary of the Military Department.
(ii) Consideration below the estimated range of present fair market
value, when proper justification is provided and when the Secretary of
the Military Department determines that a discount is necessary for
economic redevelopment and job creation.
(3) If the consideration under an EDC is within the range of value
listed in paragraph (f)(2)(i) of this section, the amount paid in the
future should take into account the time value of money and include
repayment of interest. Any transaction that waives or delays interest
payments will be considered as a transaction below the present fair
market value under paragraph (f)(2)(ii) of this section, and as such
must be justified as necessary for economic development and job
creation.
(4) Additional provisions may be incorporated in the conveyance
documents to protect the Department's interest in obtaining the agreed
upon compensation, including such items as predetermined release
prices, or other appropriate clauses designed to ensure payment and
protect against fraudulent transactions.
(5) In a rural area, as defined by this rule, any EDC approved by
the Secretary of the Military Department shall be made without
consideration if the base closure will have a substantial adverse
impact on the economy of the communities in the vicinity of the
installation and on the prospect for their economic recovery.
(6) In those instances in which an EDC is made for consideration
below the range of the estimated present fair market value of the
property--or if the estimated present fair market value is expressed as
a range of values, below the lowest value in that range--the Military
Department shall prepare a written explanation of why the estimated
present fair market value was not obtained. Additionally, the Military
Departments must prepare a written statement explaining why other
federal property transfer authorities could not be used to generate
economic redevelopment and job creation.
(g) Leasing of real property. (1) Leasing of real property prior to
the final disposition of closing and realigning bases may facilitate
state and local economic adjustment efforts and encourage economic
redevelopment.
(2) In addition to leasing property at fair market value, to assist
local redevelopment efforts the Secretaries of the Military Departments
may also lease real and personal property located at a military
installation to be closed or realigned under a base closure law,
pending final disposition, for less than fair market value if the
Secretary concerned determines that:
(i) A public interest will be served as a result of the lease; and
(ii) The fair market value of the lease is unobtainable, or not
compatible with such public benefit.
(3) Pending final disposition of an installation, the Military
Departments may grant interim leases which are short-term leases that
make no commitment for future use or ultimate disposal. When granting
an interim lease, the Military Department will generally lease to the
LRA but can lease property directly to other entities. If the interim
lease is entered into prior to completion of the final disposal
decisions under the National Environmental Policy Act (NEPA) process,
the term may be for up to five years, including options to renew, and
may contain restrictions on use. Leasing should not delay the final
disposal of the property. After completion of the final disposal
decisions, the term of the lease may be longer than five years.
[[Page 37347]]
(4) If the property is leased for less than fair market value to
the LRA and the interim lease permits the property to be subleased, the
interim lease shall provide that rents from the subleases will be
applied by the lessee to the protection, maintenance, repair,
improvement and costs related to the property at the installation
consistent with 10 U.S.C. 2667.
(h) Personal property. (1) This section outlines procedures to
allow transfer of personal property to the LRA for the effective
implementation of a community reuse plan.
(2) Each Military Department and DoD Component, as appropriate,
will take an inventory of the personal property, including its
condition, within 6 months after the date of approval of closure or
realignment. This inventory will be limited to the personal property
located on the real property to be disposed of by the Military
Department or DoD Component. The inventory will be taken in
consultation with LRA officials. If there is no LRA, the Military
Department will offer to provide a consultation for the local
government in whose jurisdiction the installation is wholly located or
for a local government agency or a state government agency designated
for that purpose by the chief executive officer of the state. Based on
these consultations, the base commander will determine the items or
category of items that have the potential to enhance the reuse of the
real property.
(3) Except for property subject to the exemptions in paragraph
(h)(5) of this section, personal property with potential to enhance the
reuse of the real estate shall remain at a base being closed or
realigned until disposition is otherwise determined by the Military
Department. This determination will be made no earlier than 90 days
after the Military Department receives an adopted redevelopment plan or
when notified by the LRA that there will be no redevelopment plan.
(4) National Guard property demonstrably identified as being
purchased with state funds is not available for reuse planning or
subject to transfer for redevelopment purposes, unless so identified by
the state property officer. National Guard property purchased with
federal funds is subject to inventory and may be made available for
redevelopment planning purposes.
(5) Personal property may be removed upon approval of the base
commander or higher authority, within and as prescribed by the Military
Department, after the inventory required in paragraph (h)(2) of this
section has been sent to the redevelopment authority, when:
(i) The property, other than ordinary fixtures, is required for the
operation of a transferring unit, function, component, weapon, or
weapons system;
(ii) The property is required for the operation of a unit,
function, component, weapon, or weapon system at another installation
within the Military Department, subject to the following conditions:
(A) Ordinary fixtures, including but not limited to such items as
blackboards, sprinklers, lighting fixtures, and electrical and plumbing
systems, shall not be removed under paragraph (h)(5)(ii) of this
section; and,
(B) Other personal property may be removed under paragraph
(h)(5)(ii) of this section only after the Military Department has
consulted with the LRA and, with respect to disputed items, upon the
approval of an Assistant Secretary of the Military Department.
(iii) The property is uniquely military in character and is likely
to have no civilian use (other than use for its material content or as
a source of commonly used components). This property consists of
classified items; nuclear, biological, chemical items; weapons and
munitions; museum property or items of significant historic value that
are maintained or displayed on loan; and similar military items;
(iv) The property is not required for the reutilization or
redevelopment of the installation (as jointly determined by the
Military Department concerned and the redevelopment authority);
(v) The property is stored at the installation for distribution
(including spare parts or stock items). This property includes
materials or parts used in a manufacturing or repair function but does
not include maintenance spares for equipment to be left in place;
(vi) The property meets known requirements of an authorized program
of another federal department or agency that would have to purchase
similar items, and the property is the subject of a written request
received from the head of the other Department or Agency. If the
authority to acquire personal property has been delegated, a copy of
the delegation must accompany the request. In this context, purchase
means the federal department or agency intends to obligate funds in the
current quarter or next six fiscal quarters. The federal department or
agency must pay packing, crating, handling, and transportation charges
associated with such transfers of personal property;
(vii) The property belongs to nonappropriated fund
instrumentalities (NAFI) and other non-Defense Department activities.
Such property may be removed at the Military Departments' discretion
because it does not belong to the Defense Department and, therefore, it
may not be transferred to the redevelopment authority under this
section. For NAFI property, separate arrangements for communities to
purchase such property are possible and may be negotiated with the
Military Department concerned; and,
(viii) The property is needed elsewhere in the national security
interest of the United States as determined by the Secretary of the
Military Department concerned. This authority may not be redelegated
below the level of an Assistant Secretary. In exercising this
authority, the Secretary may transfer the property to any entity of the
Department of Defense or other federal agency.
(6) In addition to the exemptions in paragraph (h)(5) of this
section, the Military Department or DoD Component is authorized to
substitute an item similar to one requested by the redevelopment
authority.
(7) Personal property not subject to the exemptions in paragraph
(h)(5) of this section may be conveyed to the redevelopment authority
as part of an economic development conveyance for the real property if
the Military Department makes a finding that the personal property is
necessary for the effective implementation of the redevelopment plan.
(8) Personal property may also be conveyed separately to the LRA
under an economic development conveyance for personal property. This
type of economic development conveyance can be made if the Military
Department determines that the transfer is necessary for the effective
implementation of a redevelopment plan with respect to the
installation. Such determination shall be based on the LRA's timely
application for the property, which should be submitted to the Military
Department upon completion of the redevelopment plan. The application
must include the LRA's agreement to accept the personal property after
a reasonable period. The transfer will be subject to reasonable
limitations and conditions on use.
(i) The Military Department will restrict the LRA's ability to
acquire personal property at less than fair market value solely for the
purpose of releasing or reselling it, unless the LRA will lease or sell
the personal property to entities which will place it into productive
use in accordance with the
[[Page 37348]]
redevelopment plan. The LRA must retain personal property conveyed
under an EDC for less than fair market value for at least one year if
it is valued at less than $5,000, or at least two years if valued at
more than $5,000. Any proceeds from such leases or sales must be used
to pay for protection, maintenance, repair or redevelopment of the
installation. The LRA will be required to certify its compliance with
the provisions of this section at the end of each fiscal year for no
more than two years after transfer. The certification may be subject to
random audits by the Government.
(9) Personal property that is not needed by the Military Department
or a federal agency or conveyed to a redevelopment authority (or a
state or local jurisdiction in lieu of a local redevelopment authority)
will be transferred to the Defense Reutilization and Marketing Office
for processing in accordance with 41 CFR parts 101-43 through 101-45,
``Federal Property Management Regulations,'' and DoD 4160.21-M.\3\
\3\ Copies may be obtained from the Defense Logistics Agency,
Attn: DLA-XPD, Alexandria, VA 22304-6100.
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(10) Useful personal property determined to be surplus to the needs
of the federal government by the Defense Reutilization and Marketing
Office and not qualifying for transfer to the redevelopment authority
under an economic conveyance may be donated to the community or
redevelopment authority through the appropriate State Agency for
Surplus Property (SASP). Personal property donated under this procedure
must meet the usage and control requirements of the applicable SASP.
Property subsequently not needed by the community or redevelopment
authority shall be disposed of as required by its SASP.
(i) Maintenace, utilities, and services. (1) Facilities and
equipment located on bases being closed are often important to the
eventual reuse of the base. This section provides maintenance
procedures to preserve and protect those facilities and items of
equipment needed for reuse in an economical manner that facilitates
based redevelopment.
(2) In order to ensure quick reuse, the Military Department, in
consultation with the LRA, will establish initial levels of maintenance
and repair needed to aid redevelopment and to protect the property for
the time periods set forth below. Where agreement between the Military
Department and the LRA cannot be reached, the Secretary of the Military
Department will determine the required levels of maintenance and repair
and its duration. In no case will these initial levels of maintenance:
(i) Exceed the standard of maintenance and repair in effect on the
date of closure or realignment approval;
(ii) Be less than maintenance and repair required to be consistent
with federal government standards for excess and surplus properties
(i.e., 41 CFR 101-47.402 and 41 CFR 101-47.4913); or,
(iii) Require any property improvements, including construction,
alteration, or demolition, except when the demolition is required for
health, safety, or environmental purposes, or is economically justified
in lieu of continued maintenance expenditures.
(3) The initial levels of maintenance and repair shall be tailored
to the redevelopment plan, and shall include the following provisions:
(i) The facilities and equipment that are likely to be utilized in
the near term will be maintained at levels that shall prevent undue
deterioration and allow transfer to the LRA.
(ii) The scheduled closure or realignment date of the installation
will not be delayed.
(4) The Military Department will not reduce the agreed upon initial
maintenance and repair levels unless it establishes a new arrangement
(e.g., termination of caretaking upon leasing of property) in
consultation with the LRA.
(5) The Military Department will determine the length of time it
will maintain the initial levels of maintenance and repair for each
closing or realigning base. This determination will be based on factors
such as the closure/realignment date and the timing of the completion
of the National Environmental Policy Act (NEPA) documentation on the
proposed disposal (such as a finding of no significant impact and
disposal decision following an environmental assessment or the record
of decision following an environmental impact statement).
(i) For a base that has not closed prior to the publication of this
rule, and where the Military Department has completed the NEPA analysis
on the proposed disposal before the operational closure of that base,
the time period for the initial levels of maintenance and repair
normally will extend no longer than one year after operational closure
of the base.
(ii) For a base that has not closed prior to the publication of
this rule, and where the base's operational closure precedes the
completion of the NEPA analysis on the proposed disposal, the time
period for the initial levels of maintenance and repair will normally
extend no longer than one year after operational closure or 180 days
after the Secretary of the Military Department approves the NEPA
analysis.
(iii) For a based that closed prior to the publication of this
rule, the time period for the existing levels of maintenance will
normally extend no longer than one year from the date of the
publication of this rule or six years after the date of approval of the
closure or realignment (whichever comes first).
(6) The Military Department may extend the time period for the
initial levels of maintenance and repair for property still under its
control for an additional period, if the Secretary of the Military
Department determines that the Local Redevelopment Authority is
actively implementing its redevelopment plan, and such levels of
maintenance are justified.
(7) Once the time period for the initial or extended levels of
maintenance and repair elapses, the Military Department will reduce the
levels of maintenance and repair to levels consistent with federal
government standards for excess and surplus properties (i.e., 41 CFR
101-47.402 and 41 CFR 101-47.4913).
Dated: July 14, 1995.
L.M. Bynum,
Alternate OSD Federal Register Liaison Officer, Department of Defense.
[FR Doc. 95-17737 Filed 7-19-95; 8:45 am]
BILLING CODE 5000-04-M
