[Federal Register Volume 70, Number 152 (Tuesday, August 9, 2005)]
[Proposed Rules]
[Pages 46116-46126]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 05-15698]


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DEPARTMENT OF DEFENSE

Office of the Secretary

32 CFR Parts 174, 175, and 176

RIN 0790-AH91


Revitalizing Base Closure Communities and Addressing Impacts of 
Realignment

AGENCY: Department of Defense (DoD).

ACTION: Proposed rule.

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SUMMARY: The Department of Defense (DoD) proposes to consolidate parts 
174

[[Page 46117]]

and 175, and amend part 176 of title 32, Code of Federal Regulations. 
These parts provide rules for the disposal of property at installations 
being closed and realigned and how to address the impacts of 
realignment at receiving installations. The resulting part 174 also 
contains amendments to address changes in the laws governing base 
closure and realignment (BRAC) made since the current parts 174 and 175 
were promulgated. In addition to the amendments to address changes in 
law, additional amendments are proposed to reflect current DoD policy 
and to address various environmental requirements not currently 
addressed in parts 174 and 175. The amendment to part 176 is 
ministerial to reflect the renumbering of parts 174 and 175.

DATES: Submit comments on or before October 11, 2005.

ADDRESSES: Address all comments concerning this proposed rule to--Attn: 
BRAC Regulations, Deputy Under Secretary of Defense (Installations & 
Environment), 3015 Defense Pentagon, Washington, DC 20301-3015.

FOR FURTHER INFORMATION CONTACT: Mr. Steven N. Kleiman at (703) 571-
9085.

SUPPLEMENTARY INFORMATION: This action is authorized by the Defense 
Base Closure and Realignment Act of 1990, Title XXIX of the National 
Defense Authorization Act for Fiscal Year 1991, Pub. L. 101-510; the 
Base Closure Community Redevelopment and Homeless Assistance Act of 
1994, Pub. L. 103-421; the Military Construction Authorization Act for 
Fiscal Year 1994, Division B of Pub. L. 103-160; and 10 U.S.C. 113.
    The Department of Defense engaged in four rounds of base closures 
and realignments announced in 1988, 1991, 1993, and 1995. The Congress 
has authorized another round of base closures and realignments in 2005 
and the process for selecting installations for closure and realignment 
is currently underway. In anticipation of the recommendations of the 
2005 Defense Base Closure and Realignment Commission becoming law, the 
DoD is revising its existing regulations on the disposal process to 
ensure they reflect current law and policy and take advantage of 
experience gained from the previous four rounds.
    The current parts 174 and 175 reflect two separate DoD issuances: 
DoD Directive 4165.66, Revitalizing Base Closure Communities and 
Community Assistance, and DoD Instruction 4165.67, Revitalizing Base 
Closure Communities--Base Closure Community Assistance. These two 
issuances are being revised to become DoD Directive 4165.66, 
Revitalizing Base Closure Communities and Addressing Impacts of 
Realignment, and DoD Instruction 4165.67, Revitalizing Base Closure 
Communities and Addressing Impacts of Realignment. The proposed part 
174 will reflect these two revised DoD issuances. Because the 
Instruction is tiered off of, and subservient to, the Directive, there 
is no reason to continue with separate parts in title 32. Combining 
these two DoD issuances, when published in the Code of Federal 
Regulations, helps to clarify and consolidate the rules that the two 
issuances jointly address.
    Since the original publication of the current parts 174 and 175, 
which directly reflect the formatting and style of the current DoDD 
4165.66 and DoDI 4165.67, the Department of Defense has changed the 
formatting and style of its issuances. This new formatting and style is 
reflected in the proposed amendments, particularly with regard to the 
proposed sections 174.1 through 174.5, which reflect the standardized 
language now used in DoD issuances. Of immediate note is the division 
of the material into separate sections based on subject, rather than 
having most of the material of the current part 175 contained in a 
single long section.
    The proposed section 174.1 continues to authorize publication of a 
DoD manual, DoD 4165.66-M, which is renamed the ``Base Redevelopment 
and Realignment Manual''.
    The proposed section 174.3 contains new and updated definitions, 
relying, when appropriate, on adopting by reference definitions 
contained in law.
    The proposed section 174.4 contains updated policy statements. The 
policy statements are reflective of current DoD policy and are similar 
to the policy enunciated in the Secretary of Defense's recommendations 
to the 2005 Defense Base Closure and Realignment Commission.
    The proposed section 174.5 contains more expansive delegations and 
re-delegations of authority. It does not include authority to select 
installations for closure and realignment, since that is not the 
subject of the proposed part. It also specifically excludes authority 
under section 330 of the National Defense Authorization Act for Fiscal 
Year 1993, because that authority has been delegated by the Secretary 
of Defense to the General Counsel of the Department of Defense.
    The proposed section 174.6 more closely tracks the statutory role 
given the local redevelopment plan than does the current provision.
    The proposed section 174.7 more closely tracks statutory provisions 
by clarifying the process for transfer of property to other DoD 
Components and Federal agencies. One goal is to expedite the process 
for determining when excess real property will be transferred to 
another Federal agency. Expediting this process should aid the Local 
Redevelopment Authority (LRA) in formulating its redevelopment plan.
    The proposed section 174.8 recognizes changes made in the law 
governing disposal by referring the user to part 176, which contains 
the current provisions governing disposal outside of the Federal 
Government.
    The proposed section 174.9 provides new language addressing 
economic development conveyances (EDCs) to reflect changes in the law. 
It deletes prior language that is now either inaccurate or unnecessary. 
It recognizes the duty of the Secretary to seek to obtain fair market 
value for EDCs. It recognizes the statutory purpose of job generation 
for an EDC. It explicitly adopts the use of the Uniform Appraisal 
Standards for Federal Land Acquisitions, published by the Appraisal 
Institute in cooperation with the U.S. Department of Justice.
    The proposed section 174.10 provides new language addressing 
consideration for EDCs. It recognizes the statutory preference for 
obtaining fair market value with the alternative of a no-cost EDC. The 
changes from prior language track changes in the law.
    The proposed section 174.11 changes prior language by emphasizing 
that the purpose of leasing property to non-Federal entities is to 
secure the final disposition of the real property.
    The proposed section 174.12 provides new language to reflect 
statutory changes in the leasing back by Federal agencies of 
transferred real property. It clarifies when such leases with an LRA 
can be used and when and how they can be terminated. In the past, such 
leasing arrangements were referred to as ``leasebacks''.
    The proposed section 174.13 reflects changes in the law dealing 
with the disposal of personal property. It clarifies what constitutes 
personal property, when and how an inventory will be conducted, and 
when further action can be taken with regard to the personal property. 
It more closely tracks the current law with regard to what qualifies as 
personal property for purposes of an inventory. It explicitly states 
that fixtures are not part of the personal property, it being the 
common rule that fixtures are part of the real property. It clarifies 
that only property owned by the United States can be considered under 
the provision, since property belonging to the State or to

[[Page 46118]]

private individuals does not belong to the United States and cannot be 
included for purposes of this provision.
    The proposed section 174.14 revises language to reflect current law 
relating to time limits on maintenance of property. It deletes prior 
language that is no longer accurate.
    The current rule does not address certain environmental matters 
that the DoD has found, as a result of previous BRAC rounds, to be 
central to the disposal and realignment process. The proposed changes 
to the current rule address four issues: (1) Indemnification under 
Section 330 of the National Defense Authorization Act for Fiscal Year 
1993; (2) decontamination of potentially explosive materials; (3) the 
National Environmental Policy Act (NEPA); and (4) historic 
preservation.
    The proposed section 174.15 is entirely new. It provides guidance 
to DoD personnel regarding the application of section 330 of the 
National Defense Authorization Act for Fiscal Year 1993. Because that 
provision of law is handled under other procedures and by an office 
other than the organizations applying the revised part 174, explicit 
guidance is provided to the DoD Components to avoid attempting to apply 
that provision of law in the process addressed by the revised part 174.
    The proposed section 174.16 is entirely new. It provides direction 
to DoD Components to ensure that restoration projects involving 
contamination by potentially explosive materials are properly 
coordinated with the DoD Explosives Safety Board in accordance with DoD 
Directive 6055.9.
    The proposed section 174.17 is entirely new. It provides direction 
to DoD Components that when conducting environmental analysis pursuant 
to the National Environmental Policy Act of 1969 (NEPA), the analysis 
will be conducted in accordance with the regulations of the Military 
Department exercising real property accountability for the 
installation. This provision clarifies which NEPA regulation will 
control when the DoD Component being realigned to an installation is 
different from the Military Department that has jurisdiction over the 
installation.
    The proposed section 174.18 is entirely new. It provides guidance 
and authority for use of what are generally referred to as preservation 
easements when disposing of property that is eligible for listing on 
the National Register under the National Historic Preservation Act.

Executive Order 12866

    It has been determined that this rule is not a significant 
regulatory action. This rule does not:
    (1) Have an annual effect to the economy of $100 million or more or 
adversely affect in a material way the economy; a section of the 
economy; productivity; competition; jobs; the environment; public 
health or safety; or State, local, or tribal governments or 
communities;
    (2) Create serious inconsistency or otherwise interfere with an 
action taken or planned by another agency;
    (3) Materially alter the budgetary impact of entitlements, grants, 
user fees, or loan programs, or the rights and obligation of recipients 
thereof; or
    (4) Raise novel legal or policy issues arising out of legal 
mandates, the President's priorities, or the principles set forth in 
Executive Order 12866.
    It has been certified that this part is not subject to the 
Regulatory Flexibility Act (5 U.S.C. 601 et seq.) because it would not, 
if promulgated, have a significant economic impact on a substantial 
number of small entities. The regulatory changes proposed in this 
notice address the disposal of Government property, primarily to LRAs, 
which are local governmental entities. The impacts on small entities 
that result from base closure are due to the closure of installations, 
which is not covered by these regulations. These regulations deal 
primarily with the subsequent disposal of property.
    It has been certified that this part does not impose any reporting 
or recordkeeping requirements under the Paperwork Reduction Act of 
1995.

List of Subjects in 32 CFR Parts 174, 175, and 176

    Community development, Government employees, Military personnel, 
Surplus Government property.
    Accordingly, 32 CFR part 174 is revised, part 175 is removed, and 
part 176 is amended to read as follows:
    1. Part 174 is revised to read as follows:

PART 174--REVITALIZING BASE CLOSURE COMMUNITIES AND ADDRESSING 
IMPACTS OF REALIGNMENT

Subpart A--General
Sec.
174.1 Purpose
174.2 Applicability
174.3 Definitions
Subpart B--Policy
174.4 Policy
174.5 Responsibilities
Subpart C--Working with Communities and States
174.6 LRA and the Redevelopment Plan
Subpart D--Real Property
174.7 Retention for DoD Component use and transfer to other Federal 
agencies
174.8 Screening for properties covered by the Base Closure Community 
Redevelopment and Homeless Assistance Act of 1994, cross-reference
174.9 Economic development conveyances
174.10 Consideration for economic development conveyances
174.11 Leasing of real property to non-Federal entities
174.12 Leasing of transferred real property by Federal agencies
Subpart E--Personal Property
174.13 Personal property
Subpart F--Maintenance and Repair
174.14 Maintenance and repair
Subpart G--Environmental Matters
174.15 Indemnification under Section 330 of the National Defense 
Authorization Act for Fiscal Year 1993
174.16 Decontamination of potentially explosive materials
174.17 NEPA
174.18 Historic preservation

    Authority: 10 U.S.C. 113 and 10 U.S.C. 2687 note.

Subpart A--General


Sec.  174.1  Purpose.

    This part:
    (a) Establishes policy, assigns responsibilities, and implements 
base closure laws and associated provisions of law relating to the 
closure and the realignment of installations. It does not address the 
process for selecting installations for closure or realignment.
    (b) Authorizes the publication of DoD 4165.66-M ,\1\ ``Base 
Redevelopment and Realignment Manual,'' in accordance with DoD 5025.1-M 
,\2\ ``DoD Directive System Procedures,'' March 2003.
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    \1\ Document scheduled for publication after completion of the 
Directive.
    \2\ Copies may be obtained at http://www.dtic.mil/whs/directives/corres/pub1.html.
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Sec.  174.2  Applicability.

    This part applies to:
    (a) The Office of the Secretary of Defense, the Military 
Departments, the Chairman of the Joint Chiefs of Staff and the Joint 
Staff, the Combatant Commands, the Office of the Inspector General of 
the Department of Defense, the Defense Agencies, the DoD Field 
Activities, and all other organizational entities in the Department of 
Defense (hereafter referred to collectively as the ``DoD Components'').

[[Page 46119]]

    (b) Installations in the United States selected for closure or 
realignment under a base closure law.
    (c) Federal agencies and non-Federal entities that seek to obtain 
real or personal property on installations selected for closure or 
realignment.


Sec.  174.3  Definitions.

    (a) Base closure law. This term has the same meaning as provided in 
10 U.S.C. 101(a)(17)(B) and (C).
    (b) Closure. An action that ceases or relocates all current 
missions of an installation and eliminates or relocates all current 
personnel positions (military, civilian, and contractor), except for 
personnel required for caretaking, conducting any ongoing environmental 
cleanup, or property disposal. Retention of a small enclave, not 
associated with the main mission of the base, is still a closure.
    (c) Consultation. Explaining and discussing an issue, considering 
objections, modifications, and alternatives; but without a requirement 
to reach agreement.
    (d) Date of approval. This term has the same meaning as provided in 
section 2910(8) of the Defense Base Closure and Realignment Act of 
1990, Pub. L. 101-510.
    (e) Excess property. This term has the same meaning as provided in 
40 U.S.C. 102(3).
    (f) Installation. This term has the same meaning as provided in the 
definition for ``military installation'' in section 2910(4) of the 
Defense Base Closure and Realignment Act of 1990, Pub. L. 101-510.
    (g) Local Redevelopment Authority (LRA). This term has the same 
meaning as provided in the definition for ``redevelopment authority'' 
in section 2910(9) of the Defense Base Closure and Realignment Act of 
1990, Pub. L. 101-510.
    (h) Military Department. This term has the same meaning as provided 
in 10 U.S.C. 101(a)(8).
    (i) National Environmental Policy Act (NEPA). The National 
Environmental Policy Act of 1969, Pub. L. 91-190, 42 U.S.C. 4321 et 
seq., as amended.
    (j) Realignment. This term has the same meaning as provided in 
section 2910(5) of the Defense Base Closure and Realignment Act of 
1990, Pub. L. 101-510.
    (k) Secretary concerned. This term has the same meaning as provided 
in 10 U.S.C. 101(a)(9) (A), (B), and (C).
    (l) Surplus property. This term has the same meaning as provided in 
40 U.S.C. 102(10).
    (m) Transition coordinator. This term has the same meaning as used 
in section 2915 of the National Defense Authorization Act for Fiscal 
Year 1994, Public Law 103-160.

Subpart B--Policy


Sec.  174.4  Policy.

    It is DoD policy to:
    (a) Act expeditiously whether closing or realigning. Relocating 
activities from installations designated for closure will, when 
feasible, be accelerated to facilitate the transfer of real property 
for community reuse. In the case of realignments, the Department will 
pursue aggressive planning and scheduling of related facility 
improvements at the receiving location.
    (b) Fully utilize all appropriate means to transfer property. 
Federal law provides the Department with an array of legal authorities, 
including public benefit transfers, economic development conveyances at 
cost and no cost, negotiated sales to state or local government, 
conservation conveyances, and public sales, by which to transfer 
property on closed or realigned installations. Recognizing that the 
variety of types of facilities available for civilian reuse and the 
unique circumstances of the surrounding communities does not lend 
itself to a single universal solution, the Department will use this 
array of authorities in a way that considers individual circumstances.
    (c) Rely on and leverage market forces. Community redevelopment 
plans and military conveyance plans should be integrated to the extent 
practical and should take account of any anticipated demand for surplus 
military land and facilities.
    (d) Collaborate effectively. Experience suggests that collaboration 
is the linchpin to successful installation redevelopment. Only by 
collaborating with the local community can the Department close and 
transfer property in a timely manner and provide a foundation for solid 
economic redevelopment.
    (e) Speak with one voice. The Department of Defense, acting through 
the DoD Components, will provide clear and timely information and will 
encourage affected communities to do the same.
    (f) Work with communities to address growth. If installation growth 
is substantial, the Department will work with the surrounding community 
so that the public and private sectors can provide the services and 
facilities needed to accommodate new personnel and their families. The 
Department recognizes that installation commanders and local officials 
need to integrate elements of their growth planning so that appropriate 
off-base facilities and services are available for arriving personnel 
and their families.


Sec.  174.5  Responsibilities.

    (a) The Under Secretary of Defense for Acquisition, Technology, and 
Logistics shall issue DoD Instructions as necessary to further 
implement applicable public laws affecting installation closure and 
realignment implementation and shall monitor compliance with this part. 
All authorities and responsibilities of the Secretary of Defense--
    (1) Vested in the Secretary of Defense by a base closure law, but 
excluding those provisions relating to the process for selecting 
installations for closure or realignment;
    (2) Delegated from the Administrator of General Services relating 
to base closure and realignment matters;
    (3) Vested in the Secretary of Defense by any other provision 
relating to base closure and realignment in a national defense 
authorization act, a Department of Defense appropriations act, or a 
military construction appropriations act, but excluding section 330 of 
the National Defense Authorization Act for Fiscal Year 1993; or
    (4) Vested in the Secretary of Defense by Executive Order or 
regulation and relating to base closure and realignment, are hereby 
delegated to the Under Secretary of Defense for Acquisition, 
Technology, and Logistics.
    (b) The authorities and responsibilities of the Secretary of 
Defense delegated to the Under Secretary of Defense for Acquisition, 
Technology, and Logistics under subsection (a) of this section are 
hereby re-delegated to the Deputy Under Secretary of Defense 
(Installations and Environment).
    (c) The Heads of the DoD Components shall ensure compliance with 
this part and any implementing guidance.
    (d) Subject to the delegations in paragraphs (a) and (b) of this 
section, the Secretaries concerned shall exercise those authorities and 
responsibilities specified in subparts C through G of this part.
    (e) The cost of recording deeds and other transfer documents is the 
responsibility of the transferee.

Subpart C--Working With Communities and States


Sec.  174.6  LRA and the Redevelopment Plan.

    (a) The LRA should have broad-based membership, including, but not 
limited to, representatives from those jurisdictions with zoning 
authority over

[[Page 46120]]

the property. Generally, there will be one recognized LRA per 
installation.
    (b) 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 
a base closure law. 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.
    (c)(1) The Secretary concerned will develop a disposal plan and, to 
the extent practicable, complete the appropriate environmental 
documentation no later than 12 months after receipt of the 
redevelopment plan. The redevelopment plan will be used as part of the 
proposed Federal action in conducting environmental analyses required 
under NEPA.
    (2) In the event there is no LRA recognized by DoD or if a 
redevelopment plan is not received from the LRA within 9 months from 
the date referred to in section 2905(b)(7)(F)(iv) of Pub. L. 101-510 
(unless an extension of time has been granted by the Deputy Under 
Secretary of Defense (Installations and Environment)), the Secretary 
concerned shall, after required consultation with the governor and 
heads of local governments, proceed with the disposal of property under 
applicable property disposal and environmental laws and regulations.

Subpart D--Real Property


Sec.  174.7  Retention for DoD Component use and transfer to other 
Federal agencies.

    (a) To speed the economic recovery of communities affected by 
closures and realignments, the Department of Defense will identify DoD 
and Federal interests in real property at closing and realigning 
installations as quickly as possible. The Secretary concerned shall 
identify such interests. The Secretary concerned will keep the LRA 
informed of these interests. This section establishes a uniform 
process, with specified timelines, for identifying real property that 
is available for use by DoD Components (which for purposes of this 
section includes the United States Coast Guard) or is excess to the 
needs of the Department of Defense and available for use by other 
Federal agencies, and for the disposal of surplus property for various 
purposes.
    (b) Upon the President's submission of the recommendations for base 
closures and realignments to the Congress in accordance with a base 
closure law, the Secretary concerned shall send out a notice of 
potential availability to the DoD Components and other Federal 
agencies. The notice of potential availability is a public document and 
should be made available on 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 shall 
implement paragraph (m) of this section at the same time.
    (c) The Secretary concerned should consider LRA input, if provided, 
in making determinations on the retention of property (location and 
size of cantonment area).
    (d) Within one week of the date of approval of the closure or 
realignment, the Secretary concerned shall issue a notice of 
availability to the DoD Components and other Federal agencies covering 
closing and realigning installation buildings and property available 
for transfer to the DoD Components and other Federal agencies. 
Withdrawn public domain lands which the Secretary of the Interior has 
determined are suitable for return to the jurisdiction of the 
Department of the Interior (DoI) will not be included in the notice of 
availability.
    (e) To obtain consideration of a requirement for such available 
buildings and property, a DoD Component or Federal agency is required 
to provide a written, firm expression of interest for buildings and 
property within 30 days of the date of the notice of availability. An 
expression of interest must explain the intended use and the 
corresponding requirement for the buildings and property.
    (f)(1) 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 a 
Military Department or Federal agency. In the case of a DoD Component 
that would normally, under the circumstances, obtain its real property 
needs from the Military Department disposing of the real property, the 
application should indicate the property would not transfer to another 
Military Department but should be retained by the current Military 
Department for the use of the DoD Component. To the extent a different 
Military Department provides real property support for the requesting 
DoD Component, the application must indicate the concurrence of the 
supporting Military Department.
    (2) Within 90 days of the notice of availability, the Federal 
Aviation Administration (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 (i) of this section. Instead, the FAA 
shall work directly with the Military Department to prepare an 
agreement to assume custody of the property necessary for control of 
the airspace being relinquished by the Military Department.
    (g) The Secretary concerned 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 
conveyances for information and technical assistance. The Secretary 
concerned will provide to the LRA points of contact at the Federal 
agencies.
    (h) DoD Components and Federal agencies are encouraged to discuss 
their plans and needs with the LRA, if an LRA exists. If an LRA does 
not exist, the consultation should be pursued with the governor or the 
heads of the local governments in whose jurisdiction the property is 
located. DoD Components and Federal agencies are encouraged to notify 
the Secretary concerned of the results of this consultation. The 
Secretary concerned, the Transition Coordinator, and the DoD Office of 
Economic Adjustment Project Manager are available to help facilitate 
communication between the DoD Components and Federal agencies, and the 
LRA, governor, and heads of local governments.
    (i) An application for property from a DoD Component or Federal 
agency must contain the following information:
    (1) A completed GSA Form 1334, Request for Transfer (for requests 
from DoD Components, a DD Form 1354 will be used). This must be signed 
by the head of the Component or agency requesting the property. If the 
authority to acquire property has been delegated, a copy of the 
delegation must accompany the form;
    (2) 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);

[[Page 46121]]

    (3) A statement that the requesting Component or agency has 
reviewed its real property holdings and cannot satisfy its 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;
    (4) A statement that the requested property would provide greater 
long-term economic benefits for the program than acquisition of a new 
facility or other property;
    (5) A statement that the program for which the property is 
requested has long-term viability;
    (6) 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;
    (7) A statement that the size of the property requested is 
consistent with the actual requirement;
    (8) A statement that fair market value reimbursement to the 
Military Department will be made at the later of January of 2008, or at 
the time of transfer, unless this obligation is waived by the Office of 
Management and Budget and the Secretary concerned, or a public law 
specifically provides for a non-reimbursable transfer (this requirement 
does not apply to requests from DoD Components);
    (9) 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 
Secretary concerned; and
    (10) A statement that the requesting agency agrees to accept 
transfer of the property in its existing condition, unless this 
obligation is waived by the Secretary concerned.
    (j) The Secretary concerned will make a decision on an application 
from a DoD Component or Federal agency based upon the following 
factors:
    (1) The requirement must be valid and appropriate;
    (2) The proposed use is consistent with the highest and best use of 
the property;
    (3) The proposed transfer will not have an adverse impact on the 
transfer of any remaining portion of the installation;
    (4) The proposed transfer will not establish a new program or 
substantially increase the level of a Component's or agency's existing 
programs;
    (5) The application offers fair market value for the property, 
unless waived;
    (6) The proposed transfer addresses applicable environmental 
responsibilities to the satisfaction of the Secretary concerned; and
    (7) The proposed transfer is in the best interest of the 
Government.
    (k) When there is more than one acceptable application for the same 
building or property, the Secretary concerned shall consider, in the 
following order--
    (1) The need to perform the national defense missions of the 
Department of Defense and the Coast Guard;
    (2) The need to support the homeland defense mission; and
    (3) The LRA's comments as well as other factors in the 
determination of highest and best use.
    (l) If the Federal agency does not meet its commitment under 
subsection (i)(8) of this section to provide the required 
reimbursement, and the requested property has not yet been transferred 
to the agency, the requested property will be declared surplus and 
disposed of in accordance with the provisions of this part.
    (m) 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 use by the 
Department of Defense. Lands deemed suitable for return to the public 
domain are not real property governed by title 40, United States Code, 
and are not governed by the property management and disposal provisions 
of a base closure law. 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.
    (1) The Secretary concerned 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 closure or 
realignment.
    (2) 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 Secretary concerned as to the final agreed upon 
withdrawn and reserved public domain lands at an installation.
    (3) 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.
    (4) The Secretary concerned will transmit a Notice of Intent to 
Relinquish (see 43 CFR Part 2370) 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 Secretary'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 
or amended.
    (5) If BLM determines the land is suitable for return, it shall 
notify the Secretary concerned that the intent of the Secretary of the 
Interior is to accept the relinquishment of the land by the Secretary 
concerned.
    (6) If BLM determines the land is not suitable for return to the 
DoI, the land should be disposed of pursuant to base closure law.
    (n) The Secretary concerned should make a surplus determination 
within six (6) months of the date of approval of closure or 
realignment, and shall inform the LRA of the determination. If 
requested by the LRA, the Secretary may postpone the surplus 
determination for a period of no more than six (6) additional months 
after the date of approval if the Secretary determines that such 
postponement is in the best interests of the communities affected by 
the closure or realignment.
    (1) In unusual circumstances, extensions beyond six months can be 
granted by the Deputy Under Secretary of Defense (Installations and 
Environment).
    (2) 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.
    (o) Once the surplus determination has been made, the Secretary 
concerned shall follow the procedures in part 176 of this title.
    (p) Following the surplus determination, but prior to the disposal 
of property, the Secretary concerned may, at the Secretary's 
discretion,

[[Page 46122]]

withdraw the surplus determination and evaluate a Federal agency's late 
request for excess property.
    (1) Transfers under this subsection shall be limited to special 
cases, as determined by the Secretary concerned.
    (2) Requests shall be made to the Secretary concerned, as specified 
under paragraphs (h) and (i) of this section, and the Secretary shall 
notify the LRA of such late request.
    (3) Comments received from the LRA and the time and effort invested 
by the LRA in the planning process should be considered when the 
Secretary concerned is reviewing a late request.


Sec.  174.8  Screening for properties covered by the Base Closure 
Community Redevelopment and Homeless Assistance Act of 1994, cross-
reference.

    The Departments of Defense and Housing and Urban Development have 
promulgated regulations 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). The Department of Defense regulations can be found 
at part 176 of this title.


Sec.  174.9  Economic development conveyances.

    (a) The Secretary concerned may transfer real property and personal 
property to the LRA for purposes of job generation on the installation. 
Such a transfer is an Economic Development Conveyance (EDC).
    (b) For installations having a date of approval for closure after 
January 1, 2005, the Secretary concerned shall seek to obtain 
consideration in connection with any transfer under this section in an 
amount equal to the fair market value of the property.
    (c) An LRA is the only entity able to receive property under an 
EDC.
    (d) A properly completed application will be used to decide whether 
an LRA will be eligible for an EDC. An LRA may submit an EDC 
application only after it adopts a redevelopment plan. The Secretary 
concerned shall establish a reasonable time period for submission of an 
EDC application after consultation with the LRA. The Secretary will 
review the application and make a decision whether to make an EDC based 
on the criteria specified in paragraph (g) of this section; such 
decision will only be made after the Secretary has notified and 
obtained the concurrence of the Deputy Under Secretary of Defense 
(Installations & Environment) of the proposed decision. The terms and 
conditions of the EDC will be negotiated between the Secretary and the 
LRA.
    (e) The application should explain why an EDC is necessary for job 
generation on the installation. In addition to the following elements, 
after the Secretary concerned reviews the application, additional 
information may be requested to allow for a better evaluation of the 
application:
    (1) A copy of the adopted redevelopment plan.
    (2) A project narrative including the following:
    (i) A general description of the property requested.
    (ii) A description of the intended uses.
    (iii) A description of the economic impact of closure or 
realignment on the local community.
    (iv) A description of the financial condition of the community and 
the prospects for redevelopment of the property.
    (v) A statement of how the EDC is consistent with the overall 
redevelopment plan.
    (3) A description of how the EDC will contribute to short- and 
long-term job generation on the installation, including the projected 
number and type of new jobs it will assist in generating.
    (4) A business/operational plan for the EDC parcel, including such 
elements as:
    (i) A development timetable, phasing schedule, and cash flow 
analysis.
    (ii) 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.
    (iii) A cost estimate and justification for infrastructure and 
other investments needed for the development of the EDC parcel.
    (iv) Local investment and proposed financing strategies for the 
development.
    (5) A statement describing why other authorities, such as public or 
negotiated sales and public benefit conveyances for education, parks, 
public health, aviation, historic monuments, prisons, and wildlife 
conservation, cannot be used to accomplish the job generation goals.
    (6) Evidence of the LRA's legal authority to acquire and dispose of 
the property.
    (7) Evidence that the LRA has full authority to perform all of the 
actions required pursuant to the terms of the EDC, and that the 
officers executing the EDC documents on behalf of the LRA have full 
authority to do so.
    (8) Proof the LRA has obtained sufficient financing for acquiring 
the EDC property and carrying out the LRA's redevelopment objectives.
    (f) Upon receipt of an application for an EDC, the Secretary 
concerned will determine whether an EDC is needed for purposes of job 
generation and examine whether the terms and conditions proposed are 
fair and reasonable. The Secretary may also consider information 
independent of the application, such as views of other Federal 
agencies, appraisals, caretaker costs, and other relevant material. The 
Secretary may propose and negotiate any alternative terms or conditions 
that the Secretary considers necessary seeking always to obtain an 
amount equal to the fair market value.
    (g) 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.
    (1) Adverse economic impact of closure or realignment on the region 
and potential for economic recovery through an EDC.
    (2) Extent of short- and long-term job generation.
    (3) Consistency with the entire redevelopment plan.
    (4) Financial feasibility of the development, including market 
analysis and need and extent of proposed infrastructure and other 
investments.
    (5) Extent of state and local investment, level of risk incurred, 
and the LRA's ability to implement the plan.
    (6) Current local and regional real estate market conditions.
    (7) Incorporation of other Federal agency interests and concerns, 
and applicability of, and conflicts with, other Federal surplus 
property disposal authorities.
    (8) Relationship to the overall Military Department disposal plan 
for the installation.
    (9) Economic benefit to the Federal Government, including 
protection and maintenance cost savings and anticipated consideration 
from the transfer.
    (10) Compliance with applicable Federal, State, interstate, and 
local laws and regulations.
    (h) Before making an EDC, the Secretary concerned shall prepare an 
estimate of the fair market value of the property.
    (1) In preparing the estimate of fair market value, the Secretary 
concerned shall use the most recent edition of the Uniform Appraisal 
Standards for Federal Land Acquisitions, published by the Appraisal 
Institute in cooperation with the U.S. Department of Justice.

[[Page 46123]]

    (2) The Secretary concerned shall consult with the LRA on valuation 
assumptions, guidelines, and on instructions given to the appraiser.
    (3) The Secretary concerned is fully responsible for completion of 
the valuation. The Secretary, in preparing the estimate of fair market 
value shall consider the proposed uses identified in the redevelopment 
plan to the extent that they are not inconsistent with the highest and 
best use.


Sec.  174.10  Consideration for economic development conveyances.

    (a) For conveyances made pursuant to Sec.  174.9 of this part, the 
Secretary concerned will review the application for an EDC and 
negotiate the terms and conditions of each transaction with the LRA. 
The Secretary will have the discretion and flexibility to enter into 
agreements that specify the form of payment and the schedule. The 
consideration may be in cash or in-kind and may be paid over time.
    (b) The Secretary concerned shall seek to obtain consideration at 
least equal to the fair market value, as determined by the Secretary.
    (c) Any amount paid in the future should take into account the time 
value of money and include repayment of interest.
    (d) Additional provisions may be incorporated in the conveyance 
documents to protect the Department's interest in obtaining the agreed 
upon consideration, including such items as predetermined release 
prices, or other appropriate clauses designed to ensure payment and 
protect against fraudulent transactions.
    (e)(1) An EDC without consideration may only be made if--
    (i) The LRA agrees that the proceeds from any sale or lease of the 
property (or any portion thereof) received by the LRA during at least 
the first seven years after the date of the initial transfer of 
property shall be used to support economic redevelopment of, or related 
to, the installation; and
    (ii) The LRA executes the agreement for transfer of the property 
and accepts control of the property within a reasonable time after the 
date of the property disposal record of decision.
    (2) The following purposes shall be considered a use to support 
economic redevelopment of, or related to, the installation--
    (i) Road construction;
    (ii) Transportation management facilities;
    (iii) Storm and sanitary sewer construction;
    (iv) Police and fire protection facilities and other public 
facilities;
    (v) Utility construction;
    (vi) Building rehabilitation;
    (vii) Historic property preservation;
    (viii) Pollution prevention equipment or facilities;
    (ix) Demolition;
    (x) Disposal of hazardous materials generated by demolition;
    (xi) Landscaping, grading, and other site or public improvements; 
and
    (xii) Planning for or the marketing of the development and reuse of 
the installation.
    (f) Every agreement for an EDC without consideration shall contain 
provisions allowing the Secretary concerned to recoup from the LRA such 
portion of the proceeds from its sale or lease as the Secretary 
determines appropriate if the LRA does not use the proceeds to support 
economic redevelopment of, or related to, the installation for the 
period specified in paragraph (e)(1) of this section.


Sec.  174.11  Leasing of real property to non-Federal entities.

    (a) Leasing of real property to non-Federal entities prior to the 
final disposition of closing and realigning installations may 
facilitate state and local economic adjustment efforts and encourage 
economic redevelopment, but the Secretary concerned will always 
concentrate on the final disposition of real and personal property.
    (b) In addition to leasing property at fair market value, to assist 
local redevelopment efforts the Secretary concerned may also lease real 
and personal property, pending final disposition, for less than fair 
market value if the Secretary determines that:
    (1) A public interest will be served as a result of the lease; and,
    (2) The fair market value of the lease is unobtainable or not 
compatible with such public benefit.
    (c) Pending final disposition of an installation, the Secretary 
concerned 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 Secretary will generally lease to the LRA but can 
lease property directly to other entities. If the interim lease (after 
complying with NEPA) is entered into prior to completion of the final 
disposal decisions, 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.
    (d) 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.


Sec.  174.12  Leasing of transferred real property by Federal agencies.

    (a) The Secretary concerned may transfer real property that is 
still needed by a Federal agency (which for purposes of this section 
includes DoD Components) to an LRA provided the LRA agrees to lease the 
property to the Federal agency in accordance with all statutory and 
regulatory guidance. (This leasing arrangement was referred to as a 
``leaseback'' in previous versions of this part.)
    (b) The decision whether to transfer property pursuant to such a 
leasing arrangement rests with the Secretary concerned. However, a 
Secretary shall only transfer property subject to such a leasing 
arrangement if the Federal agency that needs the property agrees to the 
leasing arrangement.
    (c) If the subject property cannot be transferred pursuant to such 
a leasing arrangement (e.g., the relevant Federal agency prefers 
ownership, the LRA and the Federal agency cannot agree on terms of the 
lease, or the Secretary concerned determines that such a lease would 
not be in the Federal interest), such property shall remain in Federal 
ownership unless and until the Secretary concerned determines that it 
is surplus.
    (d) If a building or structure is proposed for transfer pursuant to 
this section, that which is leased by the Federal agency may be all or 
a portion of that building or structure.
    (e) Transfers pursuant to this section must be to an LRA.
    (f) Either existing Federal tenants or Federal agencies desiring to 
locate onto the property after operational closure may make use of such 
a leasing arrangement. The Secretary concerned may not enter into such 
a leasing arrangement unless:
    (1) In the case of a Defense Agency, the Secretary concerned is 
acting in an Executive Agent capacity on behalf of the Agency that 
certifies that such a leasing arrangement is in the interest of that 
Agency; or,
    (2) In the case of a Military Department, the Secretary concerned 
certifies that such a leasing arrangement is in the best interest of 
the Military Department and that use of the property by the Military 
Department is consistent with the obligation to close or realign

[[Page 46124]]

the installation in accordance with the recommendations of the Defense 
Base Closure and Realignment Commission.
    (g) Property eligible for such a leasing arrangement is not surplus 
because it is still needed by the Federal Government. Even though the 
LRA would not otherwise have to include such property in its 
redevelopment plan, it should include the property in its redevelopment 
plan anyway to take into account the planned Federal use of such 
property.
    (h) The terms of the LRA's lease to the Federal Government should 
afford the Federal agency rights as close to those associated with 
ownership of the property as is practicable. The requirements of the 
General Services Administration (GSA) Federal Acquisition Regulation 
(48 CFR Part 570) are not applicable to the lease, but provisions in 
that regulation may be used to the extent they are consistent with this 
part. The terms of the lease are negotiable subject to the following:
    (1) The lease shall be for a term of no more than 50 years, but may 
provide for options for renewal or extension of the term at the request 
of the Federal Government. The lease term should be based on the needs 
of the Federal agency.
    (2) The lease, or any renewals or extensions thereof, shall not 
require rental payments.
    (3) Notwithstanding paragraph (h)(2) of this section, if the lease 
involves a substantial portion of the installation, the Secretary 
concerned may obtain facility services for the leased property and 
common area maintenance from the LRA or the LRA's assignee as a 
provision of the lease.
    (i) Such services and common area maintenance shall be provided at 
a rate no higher than the rate charged to non-Federal tenants of the 
transferred property.
    (ii) Such services and common area maintenance shall not include--
    (A) Municipal services that a State or local government is required 
by law to provide to all landowners in its jurisdiction without direct 
charge, including police protection; or
    (B) Firefighting or security-guard functions.
    (iii) The Federal agency may be responsible for services such as 
janitorial, grounds keeping, utilities, capital maintenance, and other 
services normally provided by a landlord. Acquisition of such services 
by the Federal agency is to be accomplished through the use of Federal 
Acquisition Regulation procedures or otherwise in accordance with 
applicable statutory and regulatory requirements.
    (4) The lease shall include a provision prohibiting the LRA from 
transferring fee title to another entity during the term of the lease, 
other than one of the political jurisdictions that comprise the LRA, 
without the written consent of the Federal agency occupying the leased 
property.
    (5)(i) The lease shall include an option specifying that if the 
Federal agency no longer needs the property before the expiration of 
the term of the lease, the remainder of the lease term may be satisfied 
by the same or another Federal agency that needs property for a similar 
use. (``Similar use'' is a use that is comparable to or essentially the 
same as the use under the original lease, as determined by the 
Secretary concerned.)
    (ii)(A) If the tenant is a DoD Component, before notifying GSA of 
the availability of the leasehold, it shall determine whether any other 
DoD Component has a requirement for the leasehold; in doing so, it 
shall consult with the LRA. If another DoD Component has a requirement 
for the leasehold, that DoD Component shall be allowed to assume the 
leasehold for the remainder of its term. If no DoD Component has a 
requirement for the leasehold, the tenant shall notify GSA in 
accordance with paragraph (h)(5)(i)(B) of this section.
    (B) The Federal tenant shall notify the GSA of the availability of 
the leasehold. GSA will then decide whether to exercise this option 
after consulting with the LRA or other property owner. The GSA shall 
have 60 days from the date of notification in which to identify a 
Federal agency to serve out the term of the lease and to notify the LRA 
or other property owner of the new tenant. If the GSA does not notify 
the LRA or other property owner of a new tenant within such 60 days, 
the leasehold shall terminate on a date agreed to by the Federal tenant 
and the LRA or other property owner.
    (iii) If the GSA decides not to exercise this option after 
consulting with the LRA or other property owner, the leasehold shall 
terminate on a date agreed to by the Federal tenant and the LRA or 
other property owner.
    (6) The terms of the lease shall provide that the Federal agency 
may repair and improve the property at its expense after consultation 
with the LRA.
    (i) Property subject to such a leasing arrangement shall be 
conveyed in accordance with the existing EDC procedures. The LRA shall 
submit the following in addition to the application requirements 
outlined in Sec.  174.9(e) of this part:
    (1) A description of the parcel or parcels the LRA proposes to have 
transferred to it and then to lease to a Federal agency;
    (2) A written statement signed by an authorized representative of 
the Federal agency that it agrees to accept the lease of the property; 
and,
    (3) A statement explaining why such a leasing arrangement is 
necessary for the long-term economic redevelopment of the installation 
property.
    (j) The exact amount of consideration, or the formula to be used to 
determine that consideration, as well as the schedule for payment of 
consideration must be agreed upon in writing before transfer pursuant 
to this section.

Subpart E--Personal Property


Sec.  174.13  Personal property.

    (a) This section outlines procedures to allow transfer of personal 
property to the LRA for the effective implementation of a community 
redevelopment plan. Personal property does not include fixtures.
    (b) The Secretary concerned, supported by DoD Components with 
personal property on the installation, 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. The inventory will be taken in 
consultation with LRA officials. If there is no LRA, the Secretary 
concerned shall consult with the local government in whose jurisdiction 
the installation is wholly located, or a local government agency or a 
State government agency designated for that purpose by the Governor of 
the State. Based on these consultations, the installation commander 
will determine the items or category of items that have the potential 
to enhance the reuse of the real property.
    (c) Except for property subject to the exemptions in subsection (e) 
of this section, personal property with potential to enhance the reuse 
of the real property shall remain at an installation being closed or 
realigned until the earlier of:
    (1) one week after the Secretary concerned receives the 
redevelopment plan;
    (2) the date notified by the LRA that there will be no 
redevelopment plan;
    (3) 24 months after the date of approval of the closure or 
realignment of the installation; or

[[Page 46125]]

    (4) 90 days before the date of the closure or realignment of the 
installation.
    (d) National Guard property under the control of the United States 
Property and Fiscal Officer is subject to inventory and may be made 
available for redevelopment planning purposes.
    (e) Personal property may be removed upon approval of the 
installation commander or higher authority, as prescribed by the 
Secretary concerned, after the inventory required in paragraph (b) of 
this section has been sent to the LRA, when:
    (1) The property is required for the operation of a unit, function, 
component, weapon, or weapons system at another installation;
    (2) 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, and chemical items; weapons and 
munitions; museum property or items of significant historic value that 
are maintained or displayed on loan; and similar military items;
    (3) The property is not required for the reutilization or 
redevelopment of the installation (as jointly determined by the 
Secretary concerned and the LRA);
    (4) The property is stored at the installation for purposes of 
distribution (including spare parts or stock items) or redistribution 
and sale (DoD excess/surplus personal property). 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;
    (5) The property meets known requirements of an authorized program 
of a DoD Component or another Federal agency that would have to 
purchase similar items, and is the subject of a written request by the 
head of the DoD Component or other Federal agency. If the authority to 
acquire personal property has been delegated, a copy of the delegation 
must accompany the request. (For purposes of this paragraph, 
``purchase'' means the DoD Component or Federal agency intends to 
obligate funds in the current quarter or next six fiscal quarters.) The 
DoD Component or Federal agency must pay packing, crating, handling, 
and transportation charges associated with such transfers of personal 
property;
    (6) The property belongs to a nonappropriated fund instrumentality 
(NAFI) of the Department of Defense; separate arrangements for 
communities to purchase such property are possible and may be 
negotiated with the Secretary concerned;
    (7) The property is not owned by the Department of Defense, i.e., 
it is owned by a Federal agency outside the Department of Defense or by 
non-Federal persons or entities such as a State, a private corporation, 
or an individual; or,
    (8) The property is needed elsewhere in the national security 
interest of the United States as determined by the Secretary concerned. 
This authority may not be re-delegated below the level of an Assistant 
Secretary. In exercising this authority, the Secretary may transfer the 
property to any DoD Component or other Federal agency.
    (f) Personal property not subject to the exemptions in subsection 
(e) of this section may be conveyed to the LRA as part of an EDC for 
the real property if the Secretary concerned makes a finding that the 
personal property is necessary for the effective implementation of the 
redevelopment plan.
    (g) Personal property may also be conveyed separately to the LRA 
under an EDC for personal property. This type of EDC can be made if the 
Secretary concerned 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 
Secretary upon completion of the redevelopment plan. The application 
must include the LRA's agreement to accept the personal property after 
a reasonable period and will otherwise comply with the requirements of 
sections 174.9 and 174.10 of this part. The transfer will be subject to 
reasonable limitations and conditions on use.
    (h) Personal property that is not needed by a DoD Component or a 
tenant Federal agency or conveyed to an LRA (or a state or local 
jurisdiction in lieu of an LRA), or conveyed as related personal 
property together with the real property, will be transferred to the 
Defense Reutilization and Marketing Office for disposal in accordance 
with applicable regulations.
    (i) Useful personal property not needed by the Federal Government 
and not qualifying for transfer to the LRA under an EDC may be donated 
to the community or LRA through the appropriate State Agency for 
Surplus Property (SASP) under 41 CFR part 102-37 surplus program 
guidelines. Personal property donated under this procedure must meet 
the usage and control requirements of the applicable SASP.

Subpart F--Maintenance and Repair


Sec.  174.14  Maintenance and repair.

    (a) Facilities and equipment located on installations being closed 
are often important to the eventual reuse of the installation. This 
section provides maintenance procedures to preserve and protect those 
facilities and items of equipment needed for reuse in an economical 
manner that facilitates installation redevelopment.
    (b) In order to ensure quick reuse, the Secretary concerned, 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 in subsection (c) of this section. Where 
agreement between the Secretary and the LRA cannot be reached, the 
Secretary will determine the required levels of maintenance and repair 
and its duration. In no case will these initial levels of maintenance:
    (1) Exceed the standard of maintenance and repair in effect on the 
date of approval of closure or realignment;
    (2) Be less than maintenance and repair required to be consistent 
with Federal Government standards for excess and surplus properties as 
provided in the Federal Management Regulations of the GSA;
    (3) Be less than the minimum levels required to support the use of 
such facilities or equipment for nonmilitary purposes; or,
    (4) 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.
    (c) Unless the Secretary concerned determines that it is in the 
national security interest of the United States, the levels of 
maintenance and repair specified in paragraph (b) of this section shall 
not be changed until the earlier of:
    (1) One week after the Secretary concerned receives the 
redevelopment plan;
    (2) The date notified by the LRA that there will be no 
redevelopment plan;
    (3) 24 months after the date of approval of the closure or 
realignment of the installation; or
    (4) 90 days before the date of the closure or realignment of the 
installation.
    (d) The Secretary concerned may extend the time period for the 
initial levels of maintenance and repair for property still under the 
Secretary's control for an additional period, if the Secretary 
determines that the LRA is

[[Page 46126]]

actively implementing its redevelopment plan, and such levels of 
maintenance are justified.
    (e) Once the time period for the initial or extended levels of 
maintenance and repair expires, the Secretary concerned will reduce the 
levels of maintenance and repair to levels consistent with Federal 
Government standards for excess and surplus properties as provided in 
the Federal Management Regulations of the GSA, except in the case of 
facilities still being used to perform a DoD mission.

Subpart G--Environmental Matters


Sec.  174.15  Indemnification under Section 330 of the National Defense 
Authorization Act for Fiscal Year 1993.

    Section 330 of the National Defense Authorization Act for Fiscal 
Year 1993, Pub. L. 102-484, as amended, provides for indemnification of 
transferees of closing Department of Defense properties under 
circumstances specified in that statute. The authority to implement 
this provision of law has been delegated by the Secretary of Defense to 
the General Counsel of the Department of Defense; therefore, this 
provision of law shall only be referred to or recited in any deed, 
sales agreement, bill of sale, lease, license, easement, right-of-way, 
or transfer document for real or personal property after obtaining the 
written concurrence of the Deputy General Counsel (Environment and 
Installations), Office of the General Counsel, Department of Defense.


Sec.  174.16  Decontamination of potentially explosive materials.

    The DoD Component conducting restoration shall submit all plans for 
decontamination of potentially explosive materials to the DoD 
Explosives Safety Board, in accordance with DoD Directive 6055.9, DoD 
Explosives Safety Board (DDESB) and DoD Component Explosives Safety 
Responsibilities, and any implementing standards issued under that 
Directive, for approval prior to disposing of property, either directly 
or by transfer to another agency for disposal or reuse.


Sec.  174.17  NEPA.

    At installations subject to this part, NEPA analysis shall comply 
with the promulgated NEPA regulations of the Military Department 
exercising real property accountability for the installation, including 
any requirements relating to responsibility for funding the analysis. 
See 32 CFR parts 651 (for the Army), 775 (for the Navy), and 989 (for 
the Air Force). Nothing in this section shall be interpreted as 
releasing a Military Department from complying with its own NEPA 
regulation.


Sec.  174.18  Historic preservation.

    (a) The transfer, lease, or sale of National Register-eligible 
historic property to a non-Federal entity at installations subject to 
this part may constitute an ``adverse effect'' under the regulations 
implementing the National Historic Preservation Act (36 CFR 
800.5(a)(2)(vii)). One way of resolving this adverse effect is to 
restrict the use that may be made of the property subsequent to its 
transfer out of Federal ownership or control through the imposition of 
legally enforceable restrictions or conditions. The Secretary concerned 
may include such restrictions or conditions (typically a real property 
interest in the form of a restrictive covenant or preservation 
easement) in any deed or lease conveying an interest in historic 
property to a non-Federal entity. Before doing so, the Secretary should 
first consider whether the historic character of the property can be 
protected effectively through planning and zoning actions undertaken by 
units of State or local government; if so, working with such units of 
State or local government to protect the property through these means 
is preferable to encumbering the property with such a covenant or 
easement.
    (b) Before including such a covenant or easement in a deed or 
lease, the Secretary concerned shall consider--
    (1) Whether the jurisdiction that encompasses the property 
authorizes such a covenant or easement; and
    (2) Whether the Secretary can give or assign to a third party the 
responsibility for monitoring and enforcing such a covenant or 
easement.

PART 175--[REMOVED AND RESERVED]

    2. Part 175 is removed and reserved.

PART 176--REVITALIZING BASE CLOSURE COMMUNITIES AND COMMUNITY 
ASSISTANCE--COMMUNITY REDEVELOPMENT AND HOMELESS ASSISTANCE

    3. The authority citation for part 176 continues to read as 
follows:

    Authority: 10 U.S.C. note.


Sec.  176.20  [Amended]

    4. Section 176.20 (b) is amended by revising ``32 CFR part 175'' to 
read ``32 CFR part 174''.

    Dated: August 4, 2005.
L.M. Bynum,
Alternate OSD Federal Register Liaison Officer, Department of Defense.
[FR Doc. 05-15698 Filed 8-8-05; 8:45 am]
BILLING CODE 5001-06-P