U.S. GOVERNMENT PRINTING OFFICE

WASHINGTON : 

1

79–010

" ! SENATE 106TH CONGRESS

2d Session

REPORT

2000

106–458

Calendar No. 905

SOUTHEAST FEDERAL CENTER PUBLICPRIVATE DEVELOPMENT ACT OF 2000

R E P O R T

OF THE

COMMITTEE ON GOVERNMENTAL AFFAIRS

UNITED STATES SENATE

TO ACCOMPANY

H.R. 3069

TO AUTHORIZE THE ADMINISTRATOR OF GENERAL SERVICES TO

PROVIDE FOR REDEVELOPMENT OF THE SOUTHEAST FEDERAL

CENTER IN THE DISTRICT OF COLUMBIA

OCTOBER 2 (legislative day, SEPTEMBER 22), 2000.—Ordered to be printed

(II)

COMMITTEE ON GOVERNMENTAL AFFAIRS

FRED THOMPSON, Tennessee, Chairman

WILLIAM V. ROTH, JR., Delaware

TED STEVENS, Alaska

SUSAN M. COLLINS, Maine

GEORGE VOINOVICH, Ohio

PETE V. DOMENICI, New Mexico

THAD COCHRAN, Mississippi

ARLEN SPECTER, Pennsylvania

JUDD GREGG, New Hampshire

JOSEPH I. LIEBERMAN, Connecticut

CARL LEVIN, Michigan

DANIEL K. AKAKA, Hawaii

RICHARD J. DURBIN, Illinois

ROBERT G. TORRICELLI, New Jersey

MAX CLELAND, Georgia

JOHN EDWARDS, North Carolina

HANNAH S. SISTARE, Staff Director and Counsel

JOHANNA L. HARDY, Counsel

JOYCE A. RECHTSCHAFFEN, Minority Staff Director and Counsel

PETER A. LUDGIN, Minority Professional Staff Member

DARLA D. CASSELL, Chief Clerk

Calendar No. 905

106TH CONGRESS REPORT

2d Session " ! SENATE 106–458

SOUTHEAST FEDERAL CENTER PUBLIC-PRIVATE

DEVELOPMENT ACT OF 2000

OCTOBER 2 (legislative day, SEPTEMBER 22), 2000.—Ordered to be printed

Mr. THOMPSON, from the Committee on Governmental Affairs,

submitted the following

REPORT

[To accompany H.R. 3069]

The Committee on Governmental Affairs, to which was referred

the bill (H.R. 3069) to authorize the Administrator of General Services to provide for redevelopment of the Southeast Federal Center

in the District of Columbia, having considered the same, reports favorably thereon with an amendment and recommends that the bill

as amended do pass.

CONTENTS

Page

I. Purpose & Summary ..................................................................................... 1

II. Background .................................................................................................... 1

III. Legislative History ......................................................................................... 4

IV. Section-by-Section Analysis .......................................................................... 5

V. Estimated Cost of Legislation ....................................................................... 5

VI. Evaluation of Regulatory Impact .................................................................. 7

VII. Changes in Existing Law .............................................................................. 7

I. PURPOSE & SUMMARY

The purpose of H.R. 3069, the Southeast Federal Center PublicPrivate Development Act of 2000, is to authorize the Administrator

of General Services to provide for the redevelopment of the Southeast Federal Center in the District of Columbia.

II. BACKGROUND

Planning the capital city

Washington, D.C.’s design is the product of careful planning. Two

plans for the city were created and followed. These plans were completed by Pierre Charles L’Enfant in the 18th Century and Senator

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James McMillan of Michigan in the 20th century. Planners today

refer to and interpret how L’Enfant and McMillan would have extended their plans to accommodate the current needs of D.C.

In 1791, Pierre Charles L’Enfant was selected by President

George Washington to plan the Federal City known as the District

of Columbia. L’Enfant, through his planning of Washington, attempted to symbolize the balance of the executive and legislative

branches of the government by placing the Capitol and White

House on prominent sites in the city and linking them with Pennsylvania Avenue. L’Enfant also highlighted the importance of

States by creating prominent squares and circles named after State

heros and linking them with roads named for the States.

L’Enfant also envisioned the possibility of new development and

planned the city such that neighborhoods were linked with one another and the Federal government. He also emphasized the importance of preserving open space, parks, and vistas. In particular he

envisioned the grand stretch of open space west of the Capitol extending to the planned Washington Monument now called The

Mall.

In 1901, Senator James McMillan, as Chairman of the Park Improvement Commission of the District of Columbia (McMillan Commission), began extending L’Enfant’s Plan to revitalize the District

of Columbia. McMillan re-emphasized the importance of open

spaces and parks. He also expanded the planning of open space and

parks away from The Mall, extending it throughout the city.

Since 1924, a National Capital planning agency has existed in

various forms to be responsible for the comprehensive planning of

the National Capital Region. The current commission is the National Capital Planning Commission (NCPC). In 1997, the NCPC

released ‘‘Extending the Legacy: Planning America’s Capital for the

21st Century,’’ intended to build upon the previous planning efforts

by creating a vision plan for the city. Although not a comprehensive plan, the Legacy Plan creates a ‘‘framework’’ for planning

which provides vision for the development of the Capital in the

21st century which includes the Southeast Federal Center. The

Legacy Plan also takes into account the local planning efforts

begun after Home Rule in 1973, which established the current local

D.C. government.

History and need for legislation

The Southeast Federal Center (Center) is a 55.3 acre site located

in Washington, DC. It is bounded by the Anacostia River on the

south, M Street on the north, the Navy Yard on the east, and 1st

Street on the west. Other than the Navy Yard, there is only moderate industrial use in the area.

During the time of Pierre Charles L’Enfant much of the Center

was under water. In 1803, President Thomas Jefferson established

shipbuilding in this area of the city. Subsequently, there was a

rapid development of wharves, warehouses and refineries. By the

end of the 19th Century, electricity and the railroad were introduced to the site.

During World War I, the nature of development on the site shifted from shipbuilding and refineries to weapons production and

most of the private development was eliminated from the site. Further changes occurred during World War II when the site was the

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center for ordnance production and repair of damaged navy vessels.

Following the war, however, development of missiles and electronic

equipment made this production and repair obsolete.

By 1962, all production ended and the Navy Yard was split into

two—a portion of the property remained with the Navy Yard and

a portion was transferred to GSA. Today, the main presence in that

area is the Navy Yard, which has increased its number of personnel over the years. GSA has attempted over the years to encourage other Federal agencies to relocate to this area to help revitalize

it; however, they have not been successful.

In 1996, Congress appropriated funds to start environmental restoration of the Navy Yard area and demolition or restoration of unused buildings to help make the area more attractive. Even with

these efforts, GSA has identified approximately 5 million square

feet of potential office space which is going unused.

H.R. 3069 provides GSA with the authority to enter into various

types of agreements with private entities including leases, contracts, cooperative agreements, limited partnerships, joint ventures, trusts, and limited liability corporations. Further, GSA

would be authorized to sell or exchange property in that area.

The Committee concluded that special authorization for GSA was

needed for several key reasons. First, previous GSA attempts to redevelop this area under the current law have failed. Second, any

property transactions authorized by H.R. 3069 must be for ‘‘fair

consideration,’’ thus ensuring the Federal government will receive

appropriate compensation for any business arrangements, leases,

sales, or exchanges. Third, the redevelopment fits into a larger revitalization plan for redevelopment, following the legacy of the

L’Enfant and McMillan plans.

Fourth, Congress has a special responsibility to the District of

Columbia as the Capital City as mandated in the United States

Constitution, Article I, Section 8, Clause 17. Finally, to ensure the

Federal interests are adequately protected, the bill requires GSA to

report to Congress on any agreements and explicitly retains the authority of the NCPC over this site to ensure future development is

consistent with the overall planning for the National Capital Region.

Local district efforts

The District of Columbia in recent years has been attempting to

revitalize the city. There already has been tremendous redevelopment in the downtown area, planned redevelopment westward from

the Navy Yard down M Street to South Capitol Street, and discussions about revitalizing key entry points into D.C. such as Georgia

Avenue and New York Avenue. The local government has attempted to facilitate this revitalization in reasonable ways.

D.C. Mayor Anthony Williams outlined key economic development priorities in the District of Columbia Strategic Plan for Fiscal

Year 2001. Among the goals of the economic development plan are

increasing targeted industries, marketing the District, increasing

access to the Capitol, establishing retail hubs/commercial centers in

neighborhoods, and relocating District agencies to neighborhoods to

spur economic growth. The redevelopment of that area is a part of

the broader revitalization that will help D.C. achieve some of the

local goals. In particular, the redevelopment of the Southeast FedVerDate 11-MAY-2000 19:37 Oct 04, 2000 Jkt 089010 PO 00000 Frm 00005 Fmt 6659 Sfmt 6602 E:\HR\OC\SR458.XXX pfrm04 PsN: SR458
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eral Center and the Navy Yard has a projected potential of creating

15,000 new jobs in D.C.

The redevelopment of the Center will also allow for better use

and public access to the waterfront. Unlike many other major cities, D.C. has underutilized its waterfronts including the waterfront

at the Center and Navy Yard. Currently, even pedestrian access to

the waterfront in the Southeast is limited. Redevelopment is intended to open access and development of this waterfront.

Although the employment level at the Navy Yard is expected to

increase by 2,000 in the near future, the lack of redevelopment of

the Southeast Federal Center may slow down or adversely effect

the redevelopment of the area. This is one of the reasons GSA and

the District of Columbia are partnering together to coordinate the

revitalization of the Southeast Federal Center. It is an important

piece of the redevelopment in that area and citywide. Also, because

of plans to encourage growth, create more open access to the waterfronts, and connect this area down M Street to South Capitol

Street, it is a natural extension of the L’Enfant and McMillan

plans as outlined in the NCPC’s ‘‘Extending the Legacy: Planning

America’s Capital for the 21st Century.’’

The authority provided to GSA in H.R. 3069 is a continuation of

this effort and is appropriate given the role the Federal government has with respect to D.C.

Amendment

The amendment offered by Senator Thompson provides technical

changes to the bill. First, it corrects the spelling of the National

Capital Planning Commission (NCPC) in section 3(f). Second, it

clarifies the role of NCPC by requiring that the Administrator of

GSA consult with NCPC on the interpretation of the NCPC vision

plan entitled ‘‘Extending the Legacy: Planning America’s Capital in

the 21st Century.’’ Third, it corrects the Senate committee to which

GSA is to report from ‘‘Environment and Public Works’’ to ‘‘Governmental Affairs.’’

III. LEGISLATIVE HISTORY

H.R. 3069 was introduced in the House of Representatives by

Representative Bob Franks (R–NJ) on October 13, 1999 for himself

and Representatives James A. Traficant, Jr. (D–OH), Robert E.

Wise, Jr. (D–WV), and Delegate Eleanor Holmes Norton (D–DC). It

was referred to the House Committee on Transportation and Infrastructure and then to the House Subcommittee on Economic Development, Public Buildings, Hazardous Materials and Pipeline

Transportation. On March 23, 2000, the House Committee on

Transportation and Infrastructure ordered reported H.R. 3069 by

voice vote. The bill was passed by voice vote under suspension of

the rules in the House on May 8, 2000.

On May 9, 2000, the bill was referred to the Senate Committee

on Governmental Affairs. The Senate Committee on Governmental

Affairs considered H.R. 3069 with an amendment offered by Senator Thompson on September 27, 2000. The Committee voted to

order the bill reported as amended by voice vote.

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IV. SECTION-BY-SECTION ANALYSIS (AS AMENDED)

Section 1 entitles the Act as the ‘‘Southeast Federal Center Public-Private Development Act of 2000.’’

Section 2 defines the ‘‘Southeast Federal Center’’ as the site in

the southeast quadrant of the District of Columbia that is under

GSA control and jurisdiction and extends from Issac Hull Avenue

on the east to 1st Street on the west, and from M Street on the

north to the Anacostia River on the south.

Section 3 authorizes the Administrator of General Services to

enter into agreements (including leases, contracts, cooperative

agreement, limited partnerships, joint ventures, trusts, and limited

liability company agreements) with a private entity.

Subsection 3(b) sets out terms and conditions for such agreements.

Subsection 3(c) requires that an agreement entered into by GSA

will be for fair consideration.

Subsection 3(d) authorizes GSA to convey any interests in real

property by lease, sale, or exchange, to a private entity.

Subsection 3(e) requires any obligations payable by GSA due to

use of space, goods, or services by GSA on property subject to an

agreement under this section be paid by funds available, in advance, in an annual appropriations Act, to GSA from the Federal

Buildings Fund.

Subsection 3(f) retains the authority of the National Capital

Planning Commission with respect the Southeast Federal Center

and requires GSA, to the extent practicable, to ensure any agreement will be in accordance with the NCPC vision plan entitled ‘‘Extending the Legacy: Planning America’s Capital in the 21st Century.’’

Subsection 3(g) excludes GSA’s authority under this section from

various federal property laws.

Section 4 requires GSA to report to Congress prior to entering

into an agreement under section 3.

Section 5 requires that net proceeds from an agreement entered

into under section 3 be deposited into, administered, and expended,

subject to appropriations Acts, as part of the fund established by

section 210 (f) of the Federal Property and Administrative Services

Act of 1949.

V. ESTIMATED COST OF LEGISLATION

U.S. CONGRESS,

CONGRESSIONAL BUDGET OFFICE,

Washington, DC, September 29, 2000.

Hon. FRED THOMPSON, Chairman, Committee on Governmental Affairs,

U.S. Senate, Washington, DC.

DEAR MR. CHAIRMAN: The Congressional Budget Office has prepared the enclosed cost estimate for H.R. 3069, the Southeast Federal Center Public-Private Development Act of 2000.

If you wish further details on this estimate, we will be pleased

to provide them. The CBO staff contact is John R. Righter.

Sincerely,

BARRY B. ANDERSON

(For Dan L. Crippen, Director).

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Enclosure.

CONGRESSIONAL BUDGET OFFICE COST ESTIMATE

H.R. 3069—Southeast Federal Center Public-Private Development

Act of 2000

H.R. 3069 would authorize the General Services Administration

(GSA) to enter into an agreement with a private entity for the purposes of redeveloping the Southeast Federal Center (SEFC) in

Washington, D.C. Because much uncertainty exists as to whether

GSA could find a private-sector partner to redevelop the SEFC and

the exact form that such an agreement might take, CBO cannot estimate the budgetary impact of H.R. 3069. Because the legislation

could affect direct spending (including offsetting receipts), pay-asyou-go procedures would apply.

An agreement to develop the SEFC under H.R. 3069 could take

one of many forms, including a lease, joint venture, or limited partnership between the federal government and a private entity.

Through such an agreement, GSA could sell a portion or all of

SEFC; lease or exchange SEFC property for space, goods, or services, including new construction or physical improvements to existing federal property; or, through a public-private partnership, construct, manage, and lease space in new facilities to federal and

nonfederal entities. The legislation would prohibit GSA from providing a federal guarantee for any debt issued as part of an agreement. Any obligation for GSA to make payments under H.R. 3069

would be subject to funding being provided in advance in appropriation acts. Under the legislation, GSA could retain and spend

any proceeds resulting from an agreement, the legislation would require GSA to report to the Congress on the proposed agreement.

Because much uncertainty exists as to whether GSA could find

a private-sector partner to redevelop the SEFC and the form such

an agreement might take, CBO cannot estimate the budgetary impact of H.R. 2069. However, depending on the type of agreement,

implementing H.R. 3069 could have significant budgetary consequences. For example, a public-private partnership formed to

construct an office building at SEFC for use by federal agencies

would be a lease-purchase agreement. Under the Budget Enforcement Act, a lease-purchase agreement would require an up-front

appropriation equal to the building’s full construction cost, and outlays would be recorded during the construction period.

Alternatively, GSA could use the authority in H.R. 3069 to provide a long-term lease of the SEFC to a private entity in exchange

for specific services, such as rent-free office space for federal agencies. Because it would not involve the payment of cash, that transaction would have no budgetary impact. Finally, GSA could sell

some or all of the SEFC property, thus increasing offsetting receipts (a credit against direct spending) from the sale of surplus

federal property.

H.R. 3069 contains no intergovernmental or private-sector mandates as defined in the Unfunded Mandates Reform Act and would

impose no costs on state, local, or tribal governments. The District

of Columbia could benefit under this legislation because public land

currently exempt from property tax would become taxable if the

property is transferred to private ownership. The outcome would

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depend on whether the District of Columbia would choose to grant

a tax exemption based on the proposed use of the property.

On April 6, 2000, CBO transmitted a cost estimate for H.R. 3069

as ordered reported by the House Committee on Transportation

and Infrastructure on March 23, 2000. The two versions of this legislation are very similar and our cost estimates are the same.

The CBO staff contacts for this estimate are John R. Righter (for

federal costs) and Susan Sieg Tompkins (for the state and local impact). The estimate was approved by Robert A. Sunshine, Assistant

Director for Budget Analysis.

VI. EVALUATION OF REGULATORY IMPACT

Pursuant to the requirements of paragraph 11(b) of rule XXVI of

the Standing Rules of the Senate, the Committee has considered

the regulatory impact of this bill. CBO states that there are no

intergovernmental or private-sector mandates as defined in the Unfunded Mandates Reform Act and no costs on state, local, or tribal

governments. The legislation contains no other regulatory impact.

VII. CHANGES IN EXISTING LAW

In compliance with paragraph 12 of rule XXVI of the Standing

Rules of the Senate, there are no changes in existing law made by

the bill as reported.

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