Opinion ID: 353836
Heading Depth: 2
Heading Rank: 2

Heading: Indirect Costs and Consequences

Text: 72 The indirect costs and consequences, including the significant adverse economic impacts on communities and individuals in the Kansas City area and the impacts on personnel that are to be relocated in the St. Louis area, must be considered by the Air Force. See Concerned About Trident v. Rumsfeld, supra; City of Rochester v. United States Postal Service, supra. Thus, the Air Force must consider factors other than its budget or that of the Department of Defense. It must consider the economies of the impacted communities and the economic effects upon the individuals who live in those communities. In the final analysis, the people who pay the bills for Kansas City, Belton, Grandview and the other communities near Richards-Gebaur are the same people who pay the bills for the defense of this nation. 73
74 The short-term economic impact of the proposed action on housing in the Kansas City metropolitan area may be considerable. The Air Force estimated that the relocation of Air Force personnel alone could result in the vacation of 1,415 resident-owned units and 1,170 rental units. Offsetting these losses, however, is an estimated demand for 10,000 additional housing units annually. This demand should alleviate the excess supply in a relatively short period. We also note that the Department of Defense Homeowner's Assistance Program will compensate individuals transferred from Richards-Gebaur to Scott who sell their homes at a price below the reasonable market value. For projected costs of this program, see Appendix I(C). 75 The proposed action will also result in an increased demand for housing in the communities near Scott. The costs of purchasing or renting housing will obviously be inflated. While the supply of housing in the communities near Scott is very low, there is a sufficient supply of housing available in the greater St. Louis metropolitan area. Most relocated personnel will have to commute a greater distance, consume more energy and spend more time commuting than was required when they lived at Richards-Gebaur. 13 76
77 The school districts in the Richards-Gebaur area will experience decreases of up to 35% In the student populations, 14 and districts in the communities near Scott will have comparable increases. The Department of Health, Education and Welfare compensates school districts with large percentages of armed services personnel dependents. This aid will continue to the districts in the Kansas City area until current programs, staffs and bond issue obligations can be partially or totally adjusted. See Appendix I(C). Thus, aid will be paid to school districts in the Kansas City area as well as to those adjacent to Scott. 78
79 Unemployment in the Richards-Gebaur area will also rise. While some highly skilled civilian employees will be transferred to Scott, many others will be without jobs when AFCS relocates. These individuals will suffer a wage loss and the community will suffer a tax loss. In addition, for each employee who loses his job at the air base, at lease one more individual in the community can expect to lose his job as a result of the decrease in economic activity. 80 The Air Force estimated that 2,000 persons will lose their jobs as a result of the proposed action. This will cause an increase in a temporary unemployment rate in the Kansas City metropolitan area from 5.4% To 6.0%. As mitigating factors, approximately 300 Richards-Gebaur employees will leave second jobs they now hold when they transfer to Scott, an estimated 620 spouses of Richards-Gebaur employees will leave their present jobs when the family moves to Scott and unemployment compensation payments of $5.8 million will be paid to those idled by the move. See Appendix I(C). 81
82 The relocations and closure and the consequent loss of employment will have a significant impact on other economic activities in the area. The Air Force estimated that the loss in payroll alone will exceed $100 million a year. Many small businesses in the area will be adversely affected. The economic impacts will be mitigated by the measures discussed above and by Small Business Administration loans and Economic Recovery Assistance grants. Unfortunately, such loans and grants will only mitigate a fraction of these losses. Some further mitigation will occur because retired military personnel now purchasing from the Richards-Gebaur commissary will be required to make their purchases from local businessmen. 83
84 In the light of the impact of the relocation on housing, employment, schools and business, we have serious doubts as to whether the annual Air Force savings of approximately $15.5 million per year will be sufficient to offset the adverse economic impacts incurred by communities, businesses and individuals in the Kansas City area. It follows that the decision to relocate is questionable. 85 The Air Force should have given greater consideration to the economic effect of its action on the communities concerned and it should have attempted to strike a better balance between savings to the Department of Defense and the direct and indirect cost to other governmental agencies, local units of government and private citizens. But for this Court to set aside the action of the Air Force, something more must be shown than that the decision was an unwise one it must be shown that the decision was an arbitrary and capricious one. We cannot say that it was. Had Richards-Gebaur been located in a smaller community our decision might well have been different because the federal action would undoubtedly have seriously damaged the long-term economic vitality of such a community. Here, the Kansas City metropolitan area contains 1.3 million people and the economy is strong and diverse enough to absorb the economic losses resulting from the proposed action. This is particularly true if the agencies of the United States government promptly meet their responsibility to those individuals and communities affected by the action. Under the circumstances, we must hold that the decision of the Air Force to relocate the AFCS from Richards-Gebaur to Scott Air Force Base was not arbitrary and capricious.