Subsequent to the April 17 announcements, the Office of the Superintendent of Ship Construction at Quincy was closed, with a related impact of nine military and 92 civilian jobs.

The actual closure schedule for the Boston Navy Shipyard, the private element in the realignment plan, calls for industrial operations at the shipyard to be completed by December 31, 1973, with the shipyard to be closed effective May 31, 1974. The first reduction-in-force from the shipyard will occur on August 3, 1973, with the release of approximately 321 persons and another 70 to be released on September 9. The impact on the Boston area can be summarized according to the following economic indicators:

Affected Civilian Work Force. The major impact of the Boston
closure announcements will obviously be on the individual DoD
civilian work force. In the case of the Boston Naval Complex,
retirement benefits will accrue to approximately 47% of the
affected civilian staff, which is far higher than the 17.9%
retirement levels previously experienced by the DoD nationwide.
The willingness of the affected Navy civilian work force to
relocate to other DoD civilian assignments is expected to be
significantly below the 46.4% DoD nationwide experience,
however, primarily due to local and family ties to the Boston

area.

To date (July 13, 1973), retirements from the Navy activities
and from Hanscom Field have amounted to 1, 806 persons, and
job placements have numbered 655 persons, with other indiv-
iduals accepting positions directly without contacting the DoD
Personnel Offices. Job offers to the affected shipyard work
force have been heavy, but few acceptances were made up to
June 20, 1973. General Dynamics, at Groton, Connecticut,
has been particularly aggressive in its job recruitment effort
for 1,000 pipefitters, boilermakers, sheet metal workers, etc.
It is estimated that only approximately 1,164 of the displaced
DoD civilian workers will actually face a reduction-in-force
action without retirement or immediate placement opportunities.

Regional Unemployment Impact. While significant in terms of gross job numbers, the 5, 944 total civilian jobs lost to the area represent only four-tenths of one percent (.4%) of the metropolitan area work force. Manufacturing job accessions alone

averaged 9,000 monthly for the Boston SMSA during 1972. The Boston unemployment rate at the time of the April closure announcements was 5.7%, which was above the national average of 5.0% for the month. The latest (May 1973) Boston SMSA unemployment rate is 6.0%, or 1% above the nationwide average. An analysis of the residential pattern of the affected Naval Complex employees indicates a wide dispersion throughout the metropolitan area, with only 25.2% of the Naval Complex civilian work force being residents of the City of Boston. The unemployment rate for the City of Boston itself registered 8.1% for April, and increased to 8.5% for May. Unemployment within the city is compounded by the difficulty of attracting low skill jobs back into the city. Even though only one shipyard employee in four resides within the city, the job loss impact of the shipyard closure to the city will be more significant due to its incremental effect on the already high city unemployment rate.

• Indirect Employment Impact. In addition to the direct employment impact, the Navy Complex also employs 340 persons through the non-appropriated fund activities such as the open mess and the Navy Exchange.

• Local Procurement and Small Business. The value of local procurement by the Boston Navy Complex amounted to $22.9 million for FY 1973, of which $11.2 million was awarded to small business concerns. It is estimated that approximately 110 small business concerns receive 25% or more of their gross sales from the Navy Complex.

Loss of Regional Income. The Boston Chamber of Commerce has estimated the loss of regional income from the Navy closure actions to be in the range of $90-$100 million annually. The gross impact amounts to $90.5 million, with net impact on income expended regionally amounting to $74.5 million.

• Housing Impact. The housing impact of the realignment announce ments will be minimal due to the wide dispersion of the DoD civilian work force, the large number of civilian retirements and the limited number of civilian relocations expected to other DoD jobs. The multi-family market in Boston presently reflects a vacancy rate of 5.7%, nearly 1% higher than one year ago.

On April 19, two days following the closure announcement, the Director of Economic Adjustment met with Governor Francis Sargent and with representatives from Mayor Kevin White's immediate staff. Following these meetings, the Governor appointed a 21-member State Conversion Commission. The City of Boston immediately assumed responsibility for the conversion efforts for the Boston area. The City of Boston will also serve the principal element in the Boston Area Task Force of the Commonwealth Conversion Commission, which has yet to be appointed. This Task Force, in concert with the City, will be the focal point for EAC assistance in the Boston adjustment effort. Six subsequent meeting s have been held in Boston and regular daily EAC contact is being maintained with the City. A resident Assistant Director of Economic Adjustment has been appointed for the Boston area for maintaining close direct contact with the New England adjustment programs.

EAC Program

In addition to the important organizational steps noted above, the EAC
program is now directed toward assisting Boston in planning for the
re-use of upwards of 377 acres of prime land for industrial and resi-
dential use. The initial City of Boston Budget of $408, 000 has been
approved, and initial FY 1973 financing has amounted to $268,000 with
the balance to be provided during FY 1974. In addition, resources for
a comprehensive land use study ($55,000) for the Charlestown, South
Boston and Chelsea facilities have also been available to the Boston
Area Task Force.

EAC assistance has been requested in 40 planning, personnel, and development actions in the Boston area. Twenty-eight of these actions have been completed through July 13.

One high priority program for the former Navy facilities has been identified--the establishment of a U.S. S. Constitution Historical Park on 27 acres of the Charlestown site under the auspices of the National Park Service for the permanent berthing of the U.S. S. Constitution.

As a result of a July 12 EAC meeting with State and City officials, the City of Boston will also assume prime responsibility for manpower training resulting from the Navy cutbacks.

A full EAC team visit to Boston is planned for later summer or early fall 1973 to permit a full review of the Boston area requirements to

convert the Navy facilities to civilian re-use. Primary attention will be given to educational, industrial and historical projects in the re-use of these former military facilities. Meanwhile, the EAC will give priority attention to all manpower retraining projects, engineering and planning studies and interim use proposals for prospective industrial occupants.

Disposition of DoD Property

Pursuant to Section 2662, Title 10 U.S. C., the Department of the Navy will submit a disposal report to the Armed Services Committees of the Congress for 130.4 acres at the Charlestown Shipyard and 169.4 acres at the South Boston Annex. In addition, another 57.6 acres of the South Boston Annex at the former Army Base may be reported following resolution of the Army Reserve, DCASR and Armed Forces Examining and Entrance Station requirements. The City of Boston has also requested early release of approximately 19-20 acres of undeveloped land at the Naval Support Activity behind the Fargo Building. The City's objective is to secure early development of this site for light industrial uses to offset the immediate employment impact of the closure actions.

Assessment

The potential availability of approximately 377 acres of prime land represents the largest single land tract to become available in Boston in many years. The City of Boston faces both the need to attract new jobs to the urban center and to strengthen its tax base. During the past eight years the tax levy in the City of Boston has increased by 132%; yet the tax base for the past 12 years (1960-1972) has increased by only $250 million, or by 17.1%.

The City of Boston possesses the organizational capabilities, with its private sector support, to secure full re-use of the former Naval Complex facilities. The South Boston Annex (227 acres including the Army Base) is particularly well suited to new industrial use. The facility is within two minutes of downtown Boston, five minutes of the regional highways leading north, south and west, and ten minutes from Logan International Airport. Boston has witnessed a dramatic decline in its cargo and port activities in recent years. The efforts of the Massachusetts Port Authority have partially offset this sharp loss. Nevertheless, the major use of the South Boston Annex for port-related or marine-related industries will be in a sector where Boston has experienced setbacks in recent years.

Prospects for the re-use of Charlestown (130 acres) will be limited by the obsolescence of the existing structures and by the difficulty of transportation access beneath the Mystic River Bridge. Approximately 10,800 of the 12, 000 machine tools and production equipment are expected to be available for community re-use in conjunction with new specific community industrial re-use plans. A range of residential uses has also been suggested for the Charlestown area. In addition, the Constitution National Historic Park will occupy 27 acres of the facilities.

The important element in securing full re-use of the Boston Navy Complex will be the full cooperation of the City and State (including the Massachusetts Port Authority) as well as the private sector. The City of Boston possesses the organizational capability and technical development expertise to lead this conversion effort. Hard work, however, remains before both the Boston Area Task Force and the Economic Adjustment Committee in securing full re-use of the Boston facilities.

Current Status

The appointment and organization of the Boston Area Task Force is the most pressing action requirement still remaining. Early completion of the $55,000 consultant land use study together with the City planning efforts should provide the basis for an overall City re-use program to be available for presentation to the EAC team during its next visit. Emphasis must be given during the forthcoming weeks to organizing and financing the required retraining programs for the affected Naval Complex work force. The City of Boston has initiated visits of potential industrial prospects to the Shipyard and is now commencing its industrial solicitation campaign.