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This report responds to a statutory requirement for information on economic adjustment assistance to communities impacted by the Defense realignments announced on April 17, 1973. The statutory requirement appears in Section 7 of the amendment to the Public Works and Economic Development Act of 1965, signed by the President on June 18, 1973. In essence, the Act asks for data on:

The economic impact of Defense realignments on communities;


The transitioning of excess Defense property to productive
civilian uses;

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The Federal resources needed to carry out community economic development plans.

This report was prepared by the Defense Office of Economic Adjustment (OEA) within the Office of the Secretary of Defense. The OEA serves as the coordinating arm of the President's inter-agency Economic Adjustment Committee (EAC) which is chaired by the Secretary of Defense and co-chaired by the Assistant Secretary of Defense (Installations and Logistics). The Director of the Office of Economic Adjustment also serves as the Staff Director of the Economic Adjustment Committee and, in both roles, reports directly to the Assistant Secretary of Defense (I&L).

This report, apart from the Community Impact Analyses, is based largely on data available in OEA, the Office of Management and Budget (OMB) and the Office of the Deputy Assistant Secretary of Defense for Installations and Housing. The Community Impact Analyses are based on discussions with community leaders, on-site surveys by representa tives of the EAC, meetings with the State, county and city professional staffs, data gathered by various DoD organizations, and inputs from appropriate member agencies of the EAC.

Affected Communities

Section 7 of the amended Act calls for specific data related to "each community affected" by the Defense facility and activity realignments announced on April 17, 1973. Taken literally, the phrase "each community affected" would certainly include many hundreds (and

possibly thousands) of cities, towns and villages. However, it would seem reasonable that the Congress did not intend this reporting requirement to include communities negligibly impacted (such as a community in which a single employee resided whose job is threatened) or communities remotely impacted (such as a community at considerable distance from the closing installation which might have a business or two serving as suppliers tothe installation) or communities beneficially impacted (such as a community gaining employment from military activities relocated to it). Further, it would appear that the Congress intended the President's Economic Adjustment Committee to respond only on matters within the purview of the Committee. Traditionally, EAC's responsibilities have been restricted to those communities that have: (1) suffered significant economic impacts as a consequence of DoD decisions and actions, and (2) asked for the Committee's assistance. The latter condition is an essential prerequisite to any EAC analysis of the economic impact because the cooperation of community officials is absolutely necessary in obtaining and evaluating relevant data. Consequently, this report defines the phrase "each community affected" to mean any community that has formally requested the Committee's assistance and which the EAC team has found will suffer economically from a Defense impact. In that context, 28 communities are eligible for coverage in this report.

It seems reasonable to assume that any community needing the Committee's help is aware of the prerequisites for obtaining it. The availability of the Committee's services was communicated to:

• The Armed Services Committees and The Appropriations

Committees of the Congress, as well as all affected
Congressmen via formal notification prior to the April 17,
1973 announcements.

The senior governmental officials in all communities in-
curring severe impacts via telephone calls or personal
briefings from Defense officials prior to the April 17, 1973

• The Governors of all States incurring severe impacts via

telephone calls or personal briefings from Defense
officials prior to the April 17, 1973 announcements;

• The community leaders in all areas containing the major

military installations affected via the military commanders
immediately following the April 17, 1973 announcements.

The 28 adversely impacted communities for which economic analyses are included in this report are:

Fairbanks, Alaska
Imperial Beach, California
Long Beach, California
Novato, California
Oxnard, California
San Francisco, California
Pasadena, California
Key West, Florida
Orlando, Florida
Albany, Georgia
Brunswick, Georgia
Savannah, Georgia
Topeka, Kansas
Bainbridge, Maryland

Barnstable County, Massachusetts
Boston, Massachusetts
Chelsea, Massachusetts
Chicopee, Massachusetts
St. Albans, New York
Philadelphia, Pennsylvania
Phoenixville, Pennsylvania
Aguadilla, Puerto Rico
Newport, Rhode Island
Quons et Point, Rhode Island
Charleston, South Carolina
Laredo, Texas
Mineral Wells, Texas
Ogden, Utah

Data Required. The amended Act calls for five types of data with respect to each community affected.

The first requirement is for details as to the facilities or portions thereof affected by the realignments which are excess to the Government's security needs and which can be turned over to the local juris diction for civilian use. A table in Chapter III of this report shows the status of property disposal in all areas where property may become available to communities, subject to statutory requirements.

The second requirement asks for a description of procedures providing for the most expeditious transfer of such facilities to civilian use. These procedures are described in Chapter IV and Appendix 10. Chapter I describes the role of the Economic Adjustment Committee in expediting action under these procedures.

The third requirement calls for comprehensive analyses of the community economic impact of a realignment which reduces or terminates activities resulting in a decrease in military or civilian perso

sonnel employed at a facility. These analyses are presented in Chapter V for the 28 communities affected. Appendices 6 and 7 illustrate the comprehensive analyses made during the course of EAC assistance to a community. Appendix 10 is an example of a pre-impact analysis made prior to the announcement of April 17th without the benefit of community inputs or on-site surveys.

ance and program resources made available by Federal agencies to communities in planning and carrying out economic development plans to utilize facilities transferred to civilian control. Technical assistance and program resources are described in Chapter IV.

The fifth requirement asks for an estimate of the Federal program resources and the anticipated cost to fully implement community economic development plans and, where necessary, for recommendations for increased appropriations to meet these anticipated costs. Chapter IV states that the 28 Defense-impacted communities will require up to $65 million in Federal financial assistance to organize, plan and carry out necessary economic adjustment projects. The report concludes that these resources can be made available without additional appropriations.

Organization of the Report

This report has been organized to present some of the considerations that enter into the transition of a community from one reliant on Defense expenditures to one with a healthy, diversified and balanced economic base. The report discusses the challenge and the opportunities in this transition, describes the approach taken by the Economic Adjustment Committee and states some of the conclusions that can be drawn from the impact situations confronting the 28 communities. In addition, of course, the report presents analyses of the economic impact of the Defense realignments on each of the 28 communities.


The President's Economic Adjustment Committee

The transition of former Defense properties to productive civilian uses and the related matter of community development to offset Defense impacts are two subjects that cannot be addressed adequately without dis cussing the role of the President's inter-agency Economic Adjustment Committee.

The Committee is an outgrowth of a highly successful program instituted in March 1961 with the establishment of the Office of Economic Adjustment in the Department of Defense. From 1961 to March 4, 1970, when President Richard Nixon created this Committee, the Office of Economic Adjustment worked informally with the various departments and agencies of government to reduce the economic impacts caused by necessary Defense decisions. In this ten-year period, hundreds of communities were assisted. (An interesting note is that a January 1969 report to President Lyndon B. Johnson from the Cabinet Coordinating Committee on Economic Planning for the End of Vietnam Hostilities recommended ''the early establishment of a coordinating group that might be called the 'Readjustment Operations Committee' to assume responsibility for detailed planning of Federal readjustment assistance to work with State and local authorities responsible for demobilization planning and to coordinate Federal readjustment programs during demobilization. "')

The EAC charter, as stated in the President's Memorandum of March 4, 1970 to the Secretary of Defense and nine other Federal agencies, expressed the Administration's commitment "to bringing the resources of the Federal Government to bear on the alleviation of economic difficulties caused by necessary Defense realignments. It directed the Secretary of Defense to serve as Chairman of the interagency Economic Adjustment Committee. It also directed him to enlist the support of State and local governments and the private sector in adjustment efforts, in combination with resources of the Committee's member agencies. (See Appendix 1.)

In the three-year period from March 1970 to March 1973, the EAC has helped 70 communities in 34 States and Puerto Rico. Thirty-five

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