No-Cost Economic Development Conveyances

[Lenny Siegel <lsiegel@cpeo.org>]

Economic Development Conveyances (EDCs) are transfers of military base
closure property to non-federal entities, such as local reuse
authorities, for a price below the market value of the property. On
April 29, 1999, Deputy Under Secretary of Defense (Installations)
Randall A. Yim signed a memorandum on EDCs for his counterparts at the
three armed services. Below we have reproduced the text:





Subject: Economic Development Conveyances (EDC) Negotiations Pending
Proposed Legislative Changes

On April 21, 1999, the President and Secretary Cohen jointly announced
that authority is being sought by the Department of Defense from the
Congress for "no cost EDCs" for base closure property, retroactive to
April 21, 1999. This proposed legislation would modify [Section]
2905(b)(4) of the Defense Base Closure and Realignment Act of 1990 and
thus, if enacted, will require adjustments to 32 CFR Part 175
(particularly [Section] 175.7(e)) and to the Base Reuse Implementation
Manual (particularly Chapter 7).

So as to provide a framework for current actions that recognizes this
emerging new policy and the risks inherent in seeking new legislation,
and permits activities to proceed, the following process shall be
utilized for all EDC negotiations until Congress has acted on this
proposal:

* Offer to Local Redevelopment Authority (LRA) every opportunity to
start or continue, as the case may be, negotiations under the current
statutory and regulatory authority.

* If, as a result of such negotiations, an agreement is reached that
includes a provision whereby a LRA agrees to pay consideration to the
United States in return for conveyance of base closure property, that
agreement shall, if requested by the LRA, also include (i) a statement
that if the Congress enacts legislation providing for "no cost EDCs" for
base closure property that permits the retroactive application of this
authority, the Department of Defense will utilize such authority to
modify such agreement to conform to the terms of that statute; and (ii)
a statement that no payments will be otherwise due and owing until one
year after the EDC agreement is signed.

* If any LRA declines to negotiate on this basis, then commencement or
resumption of negotiations will await action of the Congress on this
legislative initiative.

* Continue to use interim leasing and other similar methods to support
actual imminent reuse proposals, as appropriate.

* Immediately forward information about site specific situations where
this guidance is insufficient to the Office of the Deputy Under
Secretary of Defense (Installations) for review.

Please give this policy memorandum the widest possible dissemination.
Thank you.

Randall A. Yim
Deputy Under Secretary (Installations)

-- 


Lenny Siegel
Director, Center for Public Environmental Oversight
c/o PSC, 222B View St., Mountain View, CA 94041
Voice: 650/961-8918 or 650/969-1545
Fax: 650/968-1126
lsiegel@cpeo.org
(PLEASE NOTE THAT WE ARE PHASING OUT
MY OLD E-MAIL ADDRESS: lsiegel@igc.org)
http://www.cpeo.org