[Congressional Record Volume 161, Number 71 (Monday, May 11, 2015)]
[Senate]
[Pages S2761-S2762]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
By Ms. COLLINS (for herself and Mr. King):
S. 1266. A bill to expand the HUBZone program for communities
affected by base realignment and closure, and for other purposes; to
the Committee on Small Business and Entrepreneurship.
Ms. COLLINS. Mr. President, I rise to introduce legislation to better
tailor the HUBZone program to meet the needs of communities affected by
the closure of U.S. military installations through the Base Closure and
Realignment, or BRAC, process. I am pleased to be joined by my
colleague from Maine, Senator King, in introducing this legislation,
the HUBZone Expansion Act of 2015.
This issue hits close to home for both Senator King and me. When
Loring Air Force Base closed in 1994 through the BRAC process, my home
of Aroostook County lost 15 percent of its population. Senator King
lives in Brunswick, ME, which also experienced a considerable drop in
population when it lost a major naval air station in 2011.
Military bases are often the economic heart of the towns and cities
in which they are located, and communities can struggle for years to
overcome the closure of those facilities as the redevelopment process
is often lengthy and riddled with bureaucratic hurdles.
In recognition of these challenges, Congress passed legislation
providing HUBZone status for 5 years to military facilities closed
through the BRAC process. This status allows small businesses located
on former military bases or in ``economically distressed communities''
with high rates of poverty or unemployment to obtain certain Federal
contracting preferences.
According to the Small Business Administration, there are currently
107 BRAC-related HUBZones in the U.S. Unfortunately, for many of the
communities surrounding closed military bases, HUBZone status has not
always had the intended effect. One of the reasons is simple. The law
defines the geographic boundaries of a BRAC-related HUBZone to be the
same as the boundaries of the closed base. When combined with the
requirement that 35 percent of the employees of a qualifying business
live within the HUBZone, redevelopment efforts are slowed or stalled.
Very few people actually live on these former bases, making it
difficult, if not impossible, for businesses and job seekers alike to
meet the HUBZone requirements.
We have seen this very situation play out following the closure of
the former Brunswick Naval Air Station, which closed as a result of the
2005 BRAC round. When the Navy left, Brunswick and its neighbor,
Topsham, lost more than 2,400 military and civilian personnel. These
two towns have a combined population of just 22,000, so losing these
jobs has taken a significant economic toll. Because so few people live
within the actual boundaries of the former naval air station, its
HUBZone designation does not provide the help these communities need.
To address this first concern, our legislation would permit
prospective employees who live just outside of the boundaries of the
closed base to count toward the 35 percent requirement. Employees who
live in the census tracts touching the boundaries of the closed base,
and in census tracts that touch those census tracts, would be included,
providing a large enough pool of potential workers for qualifying
businesses to locate within the HUBZone.
A second reason that businesses have difficulty benefiting from the
HUBZone program is because closed bases are given HUBZone status for a
limited time, only 5 years. Local economic development agencies working
to attract new businesses to a former base cannot begin until a base is
closed, and this process can take many years. Because HUBZone
preferences only apply for 5 years from closure, businesses often lose
years of program eligibility. In fact, the Association of Defense
Communities reports that in the seven years following the 2005 BRAC
round, only \1/3\ of former base property has been transferred to local
authorities for redevelopment. Our legislation would address this
problem by extending the period of time for which a closed base is
eligible for HUBZone status from 5 years after closure to 8 years.
Steve Levesque, the Executive Director of the Midcoast Regional
Redevelopment Authority, oversees the redevelopment of the former
Brunswick Naval Air Station. Steve supports this legislation,
explaining that BRAC facilities do not have adequate residential areas
needed to support the 35 percent residency requirement and that
businesses cannot ``realize the HUBZone benefits for BRAC'd
installations as envisioned by Congress.''
Heather Blease is a Mainer who has explained the need for these
changes as well. Heather is an entrepreneur who opened a small business
at the former Brunswick Naval Air Station in 2013. She has described
the HUBZone law as ``flawed,'' because the limited number of residences
on the base make it nearly impossible to meet the 35 percent residency
requirement. She says that this proposed legislation ``would make all
the difference in the world'' for her business, and would create needed
jobs for Mainers.
The Association of Defense Communities also supports our effort to
tailor the HUBZone program to make it more usable by closed military
bases.
I ask my colleagues to support the HUBZone Expansion Act of 2015 to
help communities and the people most affected get back on their feet
after the loss of a military installation, closed through the BRAC
process.
Mr. President, I ask unanimous consent that a letter of support be
printed in the Record.
There being no objection, the material was ordered to be printed in
the Record, as follows:
Association of Defense Communities,
May 5, 2015.
Hon. John McCain,
Chairman, Armed Services Committee, United States Senate,
Washington, DC.
Hon. Jack Reed,
Ranking Member, Armed Services Committee, United States
Senate, Washington, DC.
Hon. Mac Thornberry,
Chairman, Armed Services Committee, House of Representatives,
Washington, DC.
Hon. Adam Smith,
Ranking Member, Armed Services Committee, House of
Representatives, Washington, DC.
Dear Chairman McCain, Ranking Member Reed, Chairman
Thornberry and Ranking Member Smith: On behalf of the
Association of Defense Communities Board of Directors, I want
to express my deep appreciation for your leadership to
support defense communities across the country. As the
leading organization serving communities with active,
realigned or closed military installations, ADC represents
more than 200 communities, states, regions and their
partners.
Communities impacted by the Base Realignment and Closure
(BRAC) process continue to face severe, long-term economic
distress. To assist in these communities' recovery, Congress
authorized additional support in the Small Business
Reauthorization Act
[[Page S2762]]
of 1997, declaring that military bases closed by BRAC are
eligible for designation as Historically Underutilized
Business Zones (HUBZones). As you know, the HUBZone program
allows small businesses in disadvantaged areas additional
opportunities to compete for federal procurements. Eighteen
years later, the HUBZone designation remains integral for
attracting small businesses to these communities and is one
of the few available federal tools supporting a community's
economic transition.
While the intent of Congress was to provide the HUBZone
designation to help closed military installations attract
small businesses, one aspect of the HUBZone program actually
works against these redevelopment areas. Under the current
law, 35 percent of a business's employees also must live in a
HUBZone area. Because a military installation's HUBZone area
encompasses only the boundaries of the former base, many
closed military installations do not have a substantial
number of HUBZone-certified residential areas from which to
draw a sufficient workforce for the businesses desiring to
locate on those properties. It often is impossible,
therefore, for a business looking to relocate to these
communities to qualify for HUBZone status. Further, there
traditionally are many delays in the multi-year process
through which local redevelopment authorities assume control
of former federal property, leaving little or no opportunity
to recruit small businesses before the statutory five-year
HUBZone designation has expired.
ADC is honored to endorse the current bipartisan
legislative language offered by Senators King and Collins and
Representatives Pingree and Poliquin, and support its
inclusion in the FY 2016 National Defense Authorization Act
(NDAA). The proposal would (1) allow small businesses in
HUBZone areas to recruit personnel from a broader workforce
and (2) extend from five years to eight years the period for
which a BRAC-impacted community could be designated a
HUBZone. If adopted, this language would be extremely helpful
to communities across the country that have supported our
nation's military missions but now are struggling to overcome
distinct economic challenges. ADC is hopeful that your
colleagues will support this provision and its inclusion in
the FY 2016 NDAA as that important legislation moves forward.
Thank you again for your leadership on this and other
important issues. We look forward to working with you and
your colleagues to further strengthen America's defense
communities.
Respectfully,
Michael Cooper,
President.
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