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Council Minutes

PROCEEDINGS OF THE CITY COUNCIL

OF THE CITY OF GRAND FORKS, NORTH DAKOTA
May 24, 2005

The city council of the city of Grand Forks, North Dakota met in special session in the council chambers in City Hall on Tuesday, May 24, 2005 at the hour of 2:00 p.m. with President Gershman presiding; pursuant to call by Mayor Brown which was served on all members of the council with the exception of Council Member Glassheim. The council met in joint session with the Grand Forks County Commissioners. Present at roll call were Council Members Brooks, Hamerlik, Glassheim, Christensen, Kerian, Kreun, Gershman - 7; absent: none; and County Commissioners Arvin Kvasager, Gary Malm, Connie Triplett, Martin Yahna, and William Murphy.

President Gershman stated what the United States Government has suggested for Grand Fork Air Force Base is important to all of us in the region, this suggested realignment could mean different opportunities for the community concerning the Air Force Base and rather than considering these opportunities separately thought it would be important to start a dialogue between the County and the City and asked John Marshal to invite George Schlossberg from Washington to meet with us and the City invited the County Commissioners to hear Mr. Schlossberg who is a nationally recognized expert on issues regarding BRAC and realignment. President Gershman also noted there was some question if we would be going into executive session, we will not and have this presentation publicly.

Mr. Schlossberg stated this is his first opportunity to say anything to the City and to the County and not sure what procedures are but if there are any questions it would be appropriate to interrupt rather than wait for the end. The Defense Base Closure Commission is in session again and there are many issues that are presented when the Defense Base Closure Commission matters, the Air Force has made a recommendation that as the process goes through may or may not have the force and effect of federal law in September of this year; what the Air Force has recommended is a realignment of Grand Forks Air Force Base and that is a peculiar term of art that the Department uses and is subject to various meanings; realignments could mean the gaining of forces, mission, jobs, could mean the loss of jobs and missions and depending on the outcome of the Commission's deliberations could be changes to the boundary lines of Grand Forks Air Force Base, could expand or shrink. The realignment that the Air Force suggested is not as well defined as some of the other realignments , they have recommended that the tankers move away and that some emerging missions come onto the Base without real definition of what those are. Numbers that were submitted to the Congress and the Commission show that there maybe some job losses and because of that recommendation certain triggers of the Defense Base Closure Act kicked in that are now available to the community. Realignment, the way it has been proposed by the Air Force, allows this community to call on the federal government for various means of assistance, they allow the community to engage with the Air Force and the Department of Defense, the Base Closure Commission and it is expected there will be a community response, there are offices in DOD that awaiting some response from the community and the way the federal government expects that response, the statute authorizes the creation of an entity called the Local Redevelopment Authority and just a term created for the statute and what it means is that it would be the single voice in the community that the Defense Department will look to as they make decision and as they respond to requests. The Local Redevelopment Authority across the country has taken on many different forms, in some communities, depending on the location and size of the property and the size of the surrounding communities, a single entity, City, County could step up and assume the responsibility for guiding process, in other cases the military installation dwarfs the surrounding communities and there have been groupings, joint powers authorities and other entities where 10 or 13 cities in various jurisdictions group together to plan a joint response. The type of response that maybe required by the community is unknown at this time because we don't know what the realignment that would come out of this would be. Most DOD responses are land based, there is land that may be excess to the needs of the military department, land that is available for development or for reuse, not clear what the response would be here and what the Air Force plan would be, not clear at this point whether there will be any land that will not be needed by the Air Force, possible in some scenarios that they will in fact require additional land for the missions.

OEA is an organization established within the Department of Defense that is the recipient of what they are looking for from the community, Office of Economic Adjustment is an office within the Office of the Secretary of Defense that has been charged with responding to communities to the various issues that are now before you. OEA has nothing to do and no responsibility for the Base Closure Commission or anything that goes forward in the Base Closure Commission process, their rule is to assist communities, address whatever may come out of the Base Closure process. After some extent OEA is dealing with communities that are gaining missions or are terribly encroached upon, many of the troops that are coming home or being brought home from Germany are going to communities that don't have the necessary infrastructure to deal with those returning troops and families and OEA will help them respond. On other cases where the recommendation is a closure, OEA will assist those communities in planning for the total shut-down of the Base. Grand Forks Air Force Base, being a realignment, we are in the middle, there are two types of entities that OEA would like to see set up, one is a Planning Redevelopment Authority and the other is actually an Implementation Local Redevelopment Authority, a Planning LRA which is interested in receiving in responses to now is what it sounds like, it has no responsibility for actually implementing any actions but it helps the Department of Defense and helps local communities put together a response as to what might happen if the recommendations of the Commission to the Commission are either adopted or changed, enlarged or shrink. A Planning LRA, according to the DOD rules, is supposed to be representative of the entire community, supposed to represent all of the political interests in the greater community, represent the business community, advocates for the homeless, aviation interests and is intended as a means to explore for the economic value of that military installation to the community and what economic value and how that can be enhanced with the community. Some of the responses that a Planning LRA and that later were Implementation LRA have nothing to do with reusing property if property is even available, some Local Redevelopment Authorities have joined together with the military department to actually improve certain services for both the community and the military installation; there have been partnerships, cooperation, both at Base level and Department level and community level, County and State levels to increase municipal services, reduce costs of services and is driven by the facts and circumstances of each case. Some bases are very close to major urban areas and makes sense to share resources to the benefit of both parties.

OEA doesn't come to this process empty-handed, which is one of the benefits of the OEA process, as a result of this round of recommendations to the Defense Base Closure Commission, the Department of Defense has sought appropriations from the Congress this year with over $60 million being requested for OEA and approx. $1.7 billion has been requested by the Department of Defense to help in this process for the current year, and there are federal resources to help in this planning process, one of the initial stages, and he would recommend the first step that should be taken is to assess from an organizational point of view what the proper local government response might be to a recommendation by the Air Force, that governmental response might be setting up a separate organization to respond, could be a municipality or county, someone taking the lead, providing the planning resources, could be a joint powers agreement, could be the State, all of these things are available from the federal government's point of view, they would like to have that single voice which they leave to the State and local government how that single voice should be crafted and what the message of that single voice should be. There are grants that OEA, Department of Defense has available now, have every expectation of awarding to each and every community that is affected by the base closure process and these initial grants would be to provide you with either the consultant or other resources that you might need to help structure that. It is somewhat more complex than is necessary but OEA even has a sample flow chart and is rather complicated and has everybody that could possibly be involved here and is far more complex than would be necessary for Grand Forks Air Force Base but that is a structure that was used by the city of San Francisco for example of major closures that were involved there, and wanted to stop at that point on the planning LRA, depending on the outcome there maybe land that is available or may not be land that is available, to the extent that there is land available that is not needed by the Air Force that is excess and surplus to federal needs, that land ultimately depending on the missions that are there could be available for public use, private use and set aside for future military use, and could result in joint uses on the Base and could result in other federal departments or State departments or local governmental entities moving onto the Base, those are all outcomes that could come out of the planning process. The implementation of that is much more complex process and is far too early to address those yet because we don't really know where this might be. He stated that this is at a general level because of the stage we are at with the Air Force, the data was only released last week as to what some of the Air Force plans are and is uncertain of what a lot of that means.

There were questions by the council and commission:

Commissioner Triplett stated that we may be downsized in terms of people but the Base may still exist in its current size for surge capacity for the Air Force and no land to be redeveloped but still looking at a huge economic impact of reduced jobs, this process could still work, that it doesn't depend on there being land available. Mr. Schlossberg stated that is correct, that with regard to the job losses, there are federal programs, Department of Labor has training programs, many of the other federal departments provide assistance in that regard, but what they will look for in almost all cases is to look for the single voice of the community, how do we wish to respond and how does the community want to respond, and the classic example would be, if there were job losses and no land base and the Department of Labor has a grant capability, who would the applicant for the grant be, it would be appropriate that the LRA that was set up would be the applicant for that, and considers setting up the LRA is the first step to address all of that.

Council Member Glassheim asked how much is available for the planning effort and when would that come about and be released. Mr. Schlossberg stated the actual planning function is pre-mature because it is uncertain now what we are responding to, typically the planning grants are available immediately after the final gavel of the Base Closure Commission, and would say about October the actual planning grant process would be available. He stated that if you look at the grants that the Department has given for the communities that were impacted from 1988, 1991, 1993 and 1995, those communities that had significant job losses received planning grants in the order of about $1 million on average, for the planning process it is spread over several years until they complete the plan.

Council Member Kerian stated in the process when we were downsized in the last round, did we take advantage of this or was it even available. Mr. Schlossberg stated it was available, the Department evaluated the communities needs at that time and looked at the percentage losses and they determined that they would not assist the community at that point, in essence we were turned down. He stated now we would be well over those thresholds at this point, and particularly as a percentage of the jobs that are on the Base, the current recommendation is for approx. with direct and indirect job losses, would be about 5,000 leaving about 500 people employed on the Base without the backfill.

Council Member Kerian stated as he looks at our community and thinks the economic impact (within a 50-mile radius) and asked his thoughts about communities with this process, how communities handle that, there are small communities, EGF across the border and number in the area that have impact. Mr. Schlossberg stated the impact is not usually spread uniformly, depending on what each of the smaller communities contributes, they will be unevenly affected, one of the largest impacts typically has been school districts, there is some assistance that is available to school districts but they are some of the hardest hit. Depending upon the nature of the job losses and initially seems like the job losses, non-Air Force job losses in the community might be of the service industry, the Department of Labor has, and would urge very strongly, that Department of Labor grants be sought for that. Most often the job losses are absorbed through a land based action so to the extent that the job losses, if this were a closure here, there would be some ability to absorb those job losses directly by attracting new users of the property; if the foot-print remains the same and no land based response then it is just a matter of absorption without the ability to attract new users of those assets, harder in that case. He stated there is no typical model, they have helped and assisted communities at Bases where there have been 13 separate political units that comprised the LRA, and also most LRA's consist of just one or two political bodies, the worst thing that can happen is an LRA that doesn't work, when you set up an organizational structure it has to be an organizational structure that can be responsive, the Air Force will look for responses and in some cases you don't have the luxury of a lot of time to respond to the extent that an organizational structure is set up that will not be able to reach consensus or a decision, the Air Force will move on and make their decisions without the benefit of your advice.

Commissioner Malm stated that they were not informed last time and somebody made the decision and what do they make their decision on, that we have a multitude of small communities who will be downsizing if it happens and drastically affected but really have very little political voice and where does this information get generated from, who becomes responsible and how fast does it have to be generated. Mr. Schlossberg stated that is the role of the local redevelopment authority, and is why the department insists that whatever LRA is established, that it be representative of the full community and that it has a responsibility for sharing all the information - one thing he should say is that the decision of who the LRA will be is not yours, the local redevelopment authority is recognized by the Secretary of Defense, the Director of OEA, Patrick O'Brien, will recognize the LRA, certainly OEA is looking for your suggestion if the community as a whole said this is the group that we believe is representative and there is every reason to think that OEA would recognize that organization that you put forward but until OEA, the federal government, recognizes the LRA they do not have the responsibility or the authority of an LRA and when recognized as an LRA, you surely have responsibilities as well, one of which is absorbing the information, processing it, sharing it and seeking input from all affected parties.

Council Member Glassheim stated in the case where there is no land base available and either closure or downsizing, are there economic development monies, in addition to labor training grants, are there economic development monies for an attempt in the larger community to replace the jobs lost attached to the redevelopment Mr. Schlossberg stated in the absence of land base on the former military installation, the Department of Defense does not have the authority to assist or work with you; however, the other domestic federal agencies do, many of the other domestic federal agencies, HUD, HHS, EDA designate areas that are impacted by Base closures as favored areas, each one of the entities might have their own particular designation but they are favored areas, the Federal Home Loan Bank Board and others were designated as an area of special interest, whether it is called a Brownfield or anything there are monies that are set aside. There is an entity called the President's Economic Adjustment Council and this consists of the Secretaries of the Domestic Federal Agencies, the Secretary of Defense, HUD, Labor, EDA, FAA, GSA and just about every federal agency that might have a role in economic development in communities, whether regard to Base closures or not. That committee meets and is charged with assisting communities with trying to fashion a federal response to aid the communities - most of it is land based but to the extent it is not land based, their programs are made available. The typical program, regular program with special emphasis being given and a target of resources towards those communities.

Council Member Hamerlik stated this isn't new for some of the people in this room today, including one of our chief generals, John Marshall, and asked if there has been some other discussions that might lead to other questions that need to be asked on the direction we should be going - if it has been discussed before and maybe other questions that should be asked. President Gershman stated the discussions have been with Mr. Marshall to do what we are doing here today so that we can all learn - the only decision that was made was to have Mr. Schlossberg here. Mr. Schlossberg stated this is his first time here, making this presentation, and would not wish anything that he is saying to be misconstrued as any lessening of his involvement or others working in lessening of support for the Base, for its mission and every effort is being made to try to convince the Air Force to reverse that decision, keep the tankers here - this is just a possibility and prudent that considerations be given as to what are the alternatives now, rather than later.
Council Member Hamerlik stated he didn't mean to apply that we were going to lessen any efforts and sorry if let that out.

Council Member Brooks stated that we are continuing on and doesn't end until September and continue with that process, that there are some grants and at this time is not time to apply and would be September and look to see what our plan would be there. In terms of LRA's is that something we should start looking at now or make up would be and that is preliminary work or can that wait until October. Mr. Schlossberg stated he thinks they should plan the LRA now, there are funds available now for the planning of the LRA - for the study and process to create your LRA, because come September if there are changes, that LRA will be up and running and can start the planning process; come September if there are no changes it can dissolve or lead the party.

Council Member Kreun stated he has done this with other communities, our size, and what is the local requirement of the communities to matching funds, etc. Mr. Schlossberg stated the match for DOD assistance, each agency is different, and can provide those, and at this point in time the match would be 10%, OEA would allow the contribution of that with in kind services and typically within the resources of the City and County, your staff's time in contribution would constitute the match. He stated the planning aspect, there is nothing unique in the military base for the planning, the planning aspect is something he believes the City and County does every day and focusing with federal assistance on a particular area to the extent that there is a land base result here, land available for development there are costs and those costs, depending upon the project sometimes are borne by the communities and sometimes by the private sector, many of the properties are ultimately auctioned off by the military department, some of the issues that he sees coming up with regard to this exact piece of property are the aviation aspects, at the end of the day, regardless of what happens, there is going to be a very big new runway in your region and hopefully used for long time by the US Air Force for flying missions that produce jobs in the community, but to the extent it is not fully used by the Air Force or not used by the Air Force, that is an opportunity and how that is absorbed, focused and shared, that is a planning function and analytical bargaining issue.

Council Member Christensen stated the situation the community finds itself in and all of us have taken the time to go to the Defense Department website, and on the website there is a link to the OEA and what came upon, can make an application for a $175,000 grant that wouldn't have any impact on what we are doing now as far as taking this to September, and that match could be in-kind, and his understanding that grant would be a grant that we would have funds available to assist us in developing our planning LRA, putting together what we would need for a local redevelopment authority, and if he would agree with this thought and if it would be prudent to proceed with the application for the $175,000 planning grant so we could begin the process of planning our LRA. Mr. Schlossberg stated that would be prudent at this time and would recommend that you apply to OEA for a grant to help you establish your governmental organizational response to establish a structure that might bring in the smaller surrounding cities, the County, the City of Grand Forks and does the State have a role. Council Member Christensen stated it could be a joint submittal by the City and County of Grand Forks and no one would be saying you are giving up any position on anything here, just making a submission and then have people within our respective structure work on the grant, for example, the county's administrator, our administrator and perhaps Mr. Thiessen from our Economic Development, not picking people and if that would be something he would recommend. Mr. Schlossberg stated it doesn't require you to pre-judge the LRA question, of who is the LRA in order to apply for a grant to help you establish your LRA, so someone that is representative of the area could go in and ask for that grant to help create and structure the organization and ultimately based upon your consultant study that comes and you establish it, create it or not and change it and that entity would go to DOD request designation as an LRA, and all you need to do right now to the extent you wish to move ahead is just think about the structure and put it on a shelf, do not need to create the structure until September at which point if it is necessary it is stood up and responds and requests designation of an LRA or does nothing.

Council Member Christensen stated it would be a recommendation that we put together a joint powers agreement to agree to make an application for the planning grant. Mr. Schlossberg stated yes and whether it's as formal as a joint powers or a joint application that both parties sign.

John Marshall stated that in previous BRAC rounds if we made any application like this, it would perceive to go against us, and in this particular BRAC round if we make any applications for these grants there is a specific statute in the BRAC laws says it does not reflect that we are giving up or that we are going out for more, and that is something that we have to make perfectly clear and wants to make sure that everybody understands we are a long way from giving up on this fight and have a very long fight and going to be difficult and no intention of doing that whatsoever.

Council Member Hamerlik stated he understands that it is up to $175,000 with 10% match and the application isn't submitted until after June 17, and if that is correct. Mr. Schlossberg stated the OEA grant application and the way they have set this up, there are three stages of grants, there were the grants that were available until May 13 which were diversification grants, communities that thought they might be on the list, wanted to seek general economic assistance to diversify their economy, the door has been shut on that; the second grant process which is available and there has not been a federal register notice, and expect the federal register notice in the next week and would be for this organizational response; the third grant application which is the actual planning application with significant funds for planning, those are not available now and not available until after the final recommendations are made.

Council Member Gershman asked if they should have a few signees to work together to see how you want to proceed with the application. Council Member Christensen stated based on Mr. Schlossberg's remarks, he thinks they have to wait until it is posted in the federal register and once it is posted he will tell us it has been posted, proceed with whatever has to be done in D.C. to get the materials, and will get those materials out to the County and City and will get some direction from him as to the process of the preparation of the joint application, seems that would be the best utilization of our team for now.

President Gershman stated that we won't take any action today, that this is informational.
Council Member Hamerlik stated he would think that maybe since we are all here we should try to decide on something, who should take the leadership and that he would like to see for the nucleus to start with the County and the City, and may wish to bring in somebody from out and broaden that, and wouldn't like to leave here today and let it drop but have some consensus of how we are going to proceed, and would like the County and the City work together. President Gershman agreed.

Commissioner Murphy stated on behalf of the County this is not very workable to have this large a group, and asked how much can we do until we get some direction from Washington. Council Member Hamerlik stated 2, 3 or 4, not the whole group, but if can agree that it would be a joint venture and get a couple individuals as the leaders of it so that when the time comes, we are ready to start working on it and have our nucleus in place and time after that the whole group has to get together. Commissioner Murphy stated without objection from the Commission they can discuss this at their next meeting and set up a couple representatives.

Council Member Glassheim stated that the announcement will be in the next day or so, and regardless of specific details in the announcement, the supervisory bodies can decide either here or in their own meetings if you want to go ahead, seems to make sense that we go ahead and then would expect that the two executives would do the work and doesn't know that we need to be on a committee to do the work, and the two executives would draft something and bring back to the bodies for individual approval or modification in the next week or two.

Commissioner Kvasager stated he would agree with Chairman Murphy that they would like to have this as subject matter of their commission meeting and set up their committee to coincide with the committee that is set up by the City, and doesn't feel we can make any rational decisions on the spur of the moment like this.

President Gershman stated that the city council is not going to meet for 2 weeks and doesn't know that there is a time constraint on that. Mr. Schlossberg stated he didn't believe there was a time constraint with the timing of the grants, there is an organization composed of cities, counties, states that have gone through the base closure process and worked with DOD, called NADC and they work cooperatively with the Department of Defense, the NADC annual meeting because of the dates of the base closure process has been set for June 4 - 7, in Denver - Patrick O'Brien, the entire OEA staff will be there and will be meeting with those that are interested and the application will be out before then and they will be receiving grant applications at that time or shortly thereafter or when communities get them in, but nothing urgent on the time.

Council Member Glassheim stated that this is a meeting of the city council and if the County has their own procedures and will meet when they meet, but would like to leave here authorizing staff to move ahead with this so that we have something underway or some resolution to the effect that the city council wishes to move forward and requests staff to prepare an application and bring back to us. President Gershman stated if we took a position that we would be willing to jointly apply.

Commissioner Triplett stated that she thought this was noticed as an official County meeting also, receiving confirmation that this is also a formal County meeting doesn't see why they couldn't at least take that much action, to say that we want to work together and whether actually appoint people or not, to the extent of saying the County is on Board and see this as a joint effort and want to be part of it and see it as part of their responsibility and generally leave appointments to the chair and if he is not ready to make the appointments today doesn't have a problem with that, but would move on behalf of the County Commission that we participate in this joint planning effort and authorize the chair to make an appointment of an appropriate number of commissioners and staff to participate with the City in a joint planning effort. Commissioner Malm seconded the motion. Commissioner Murphy stated he doesn't have any problem with that and the contact person would be Mr. Neirode and would not make an appointment today but would discuss at their next scheduled meeting. There was no further discussion on the motion and Commissioner Murphy called for a vote on the motion and declared the motion carried.

Council Member Christensen moved on behalf of the city council so that we also engage in a joint planning process with the County of Grand Forks and direct staff, Mr. Duquette, to work in conjunction with the City's staff and Mr. Thiessen as part of the preparation of the grant application. Council Member Glassheim seconded the motion. Upon call for the question and upon voice vote, the motion carried 7 votes affirmative.

President Gershman thanked Mr. Schlossberg.

ADJOURN

It was moved by Council Member Christensen and seconded by Council Member Brooks that we adjourn. Carried 7 votes affirmative. County Commissioner Malm adjourned the meeting.

Respectfully submitted,

John M. Schmisek
City Auditor