8 February 1999
Source: http://www.access.gpo.gov/su_docs/aces/fr-cont.html

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[Federal Register: February 8, 1999 (Volume 64, Number 25)]
[Notices]
[Page 6089-6092]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr08fe99-108]

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GENERAL SERVICES ADMINISTRATION


Public Building Service; Record of Decision, Proposed Disposal of
Governors Island, New York Harbor, New York, NY

I. Introduction

    The United States General Services Administration (GSA) announces
its decision, in accordance with the National Environmental Policy Act
of 1969, as amended (NEPA), and the regulations issued by the Council
on Environmental Quality (40 CFR Parts 1500-1508), for the proposed
disposal of federally-owned real property known as Governors Island,
New York Harbor, New York, New York. The purpose of this Record of
Decision (ROD) is to clearly communicate GSA's decision on implementing
the Preferred Alternative identified in the Final Environmental Impact
Statement dated November 4, 1998 (the FEIS) and the basis for that
decision, and to identify any mitigation measures to be implemented as
part of that decision. This ROD describes the alternatives considered
and the rationale for selecting the chosen alternative and documents my
decision regarding this proposal.
    Public scoping meetings for the Draft Environmental Impact
Statement (the DEIS) were held on December 16 and 17, 1997. The period
for comments on the proposed disposal action was open from December 1,
1997 and ended on January 19, 1998. GSA released the DEIS for a 45-day
public comment period on June 5, 1998. Public hearings were held during
the comment period on June 24 and 25, 1998. The FEIS was released for a
30-day public comment period which closed on December 14, 1998. GSA
provided written Notices of Availability for these documents in the
Federal Register, local newspapers and direct mailings to interested
parties.
The purpose and need for the proposed action is for GSA to comply with
a legislative directive with respect to approximately 172 acres of
Federally-owned property known as Governors Island, New York, as
provided in the Balanced Budget Act of 1997 (Item 373:[17], Sec. 9101)
as signed by President Clinton, described below:

    (a) In General--Notwithstanding any other provision of law, the
administrator of General Services shall, no earlier than fiscal year
2002, dispose of by sale at fair market value all rights, title, and
interests of the United States in and to the land of, and
improvements to, Governors Island, New York.
    (b) Right of First Offer--Before a sale is made under subsection
(a) to any other parties, the State of New York and the City of New
York shall be given the right of first offer to purchase all or part
at fair market value as determined by the Administrator of General
Services, such right may be exercised by either the State of New
York or the City of New York or by both the parties acting jointly.
    (c) Proceeds--Proceeds from the disposal of Governors Island
under subsection (a) shall be deposited in the general fund of the
Treasury and credited as miscellaneous receipts.

In accordance with NEPA, GSA disclosed information concerning the
potential environmental effects associated with the disposition of this
property. GSA examined a range of reasonably foreseeable land use
options that might be implemented on the island by another party after
disposal. GSA has no authority to implement a reuse on Governors
Island. Potential future reuses on Governors Island would be subject to
their own environmental and land use review

[[Page 6090]]

processes upon implementation. The ultimate reuse scheme for the island
will be determined by the future owners and will be subject to all
applicable Federal, State and local regulations.

II. Alternatives Considered

    Through the environmental review process, GSA identified a
preferred alternative, the Action Alternative (disposition of Governors
Island), as well as the No Action Alternative (retention of Governors
Island). In conjunction with the disposition alternative, and in order
to disclose any potential impacts and/or benefits that could result
from the island's reuse by a party other than GSA after disposition, a
number of potential Land Use Options were reviewed for Governors
Island. These options were developed during the preparation of the
Governors Island Land Use Study, commissioned by GSA. The land use
options are illustrative of a range of reasonably foreseeable reuses
that might be implemented on the island by another party or parties.
The options were developed based on a year-long effort that included
input from local, State and Federal agencies as well as the public at
large. The options are not reflective of any GSA plans for the future
of the island. The land use options encompass what GSA believes to be a
range of reasonable and likely land uses, given the island's
opportunities and constraints. Before the implementation of any future
reuse of the island the sponsoring party would need to comply with all
of the applicable local, State, and Federal laws and regulations. This
may include the preparation of a project-specific Environmental
Assessment or Environmental Impact Statement and the provision of a
specific mitigation plan.

A. No Action Alternative

    The No-Action Alternative assumes that the island is not disposed
of by GSA after the fiscal year (FY) 2002. Under this alternative, the
Federal government would retain ownership of Governors Island. The
annual appropriation of monies for the on-island caretaking effort are
assumed to continue.

B. Action Alternative

    The Action Alternative involves the disposition of Governors Island
by GSA. As directed by the Balanced Budget Act of 1997, GSA has been
limited to two distinct means by which to dispose of Governors Island;
disposition to New York State or New York City for fair market value;
and, disposition to another or entities for fair market value.
    Because of GSA's mandate under the Balanced Budget Act to dispose
of the island to another party, as well as GSA's inability to specify
or control the land uses that may be developed on disposed property in
the future, a precise statement of the specific land use-related
environmental and socioeconomic effects that could result from reuse
would be largely hypothetical. In response to the lack of certainty
concerning a future reuse for the island, GSA has developed a range of
reasonably foreseeable land use options that might result upon
disposition of the island. These land use options were developed
through a planning effort undertaken by the United States Coast Guard
(USCG) and GSA, with input from New York State and New York City
officials as well as the public, which culminated in the Governors
Island Land Use Study.
    The specific purpose of the land use options was to describe a
range of reasonable uses that could be implemented on the Island upon
disposition. The FEIS generically disclosed the potential impacts
pertaining to the short and long term, direct and indirect, beneficial
and adverse significant regional cumulative impacts associated with
these land use options.
    This analysis was provided in order to explore the issues
associated with the reuse of the island by a party other than GSA. GSA
has no intention of implementing any of the Land Use Options. The
potential land use options that resulted from the Governors Island Land
Use Study analyzed in conjunction with the Action Alternative,
disposition of Governors Island, are as follows:
    1. Reuse Option. This option reuses as many buildings as is
feasible, while expanding open space. There is a strong residential
focus.
    2A. Academic Option. This option assumes use of the Island by an
academic institution of approximately 4,000 students. There is a large
open and recreational space component.
    2B. Academic Option with New York City Proposal for a Casino. This
option is similar to the Academic Option, with the inclusion of a
gambling casino and its necessary ancillary facilities. Review of this
option was requested by New York City during the environmental scoping
period.
    3. Recreation Option. This option's predominant use is a 70-acre
public park. Some residential units and a conference center are also
included.
    4. Mixed Use Option. This option strikes a balance between new
development and a public park. Major components of this option include
a 42-acre park and approximately 2,400 housing units.
    5. Maximum Development Option. This option features the highest
residential density (4,450 units in apartments and townhouses) of all
the land use options. It also includes a 20-acre park, hotel, golf
course and retail uses.
    6. Phase-In Option. This option is intended for transitional use of
existing facilities prior to implementation of any of the land use
options. Residential and hotel or hostel use is emphasized.
    The FEIS provides a narrative description and a tabular summary of
the potential environmental consequences of each of the land use
options. Recommended mitigation for any adverse environmental
consequences is also set forth in the narrative description and tabular
summary. GSA itself has no intention of implementing any of the land
use options, and only intends to transfer the property to another party
who would determine the island's ultimate land use. Mitigation for any
future adverse impacts identified in association with the land use
options or other specific development plans would be the responsibility
of the future owner of Governors Island. A specific development plan
for the island would be subject to Federal, State and local regulations
that would ensure proper mitigation of adverse impacts associated with
any future development.

III. Decision

    Based upon review of the written materials associated with the
environmental review process, including the transcripts of the scoping
and public hearings and the comments received from those who reviewed
the DEIS and FEIS, I have decided to proceed with the disposal of
Governors Island under the Action Alternative as summarized above. This
ROD is in keeping with the statutory mission of GSA to dispose of
Federally-owned real property, as well as the Balanced Budget Act of
1997 that mandates disposal of Governor Island. My decision is based on
the following factors:
    A. On October 16, 1995, the USCG announced that it would close
Governors Island by the end of Summer 1997. This decision was made in
response to the Presidential mandate to meet the goals of the National
Performance and Results Act, and the challenge of reducing the Federal
budget deficit. The USCG developed a five-part Integrated Business
Decision Package, of which closing Support

[[Page 6091]]

Center New York on Governors Island was a key element.
    An Environmental Assessment (EA) was prepared under the guidance of
Coast Guard direction COMDTINST M16475.1B (Final Environmental
Assessment for the Closure of Support Center New York, Governors
Island, May 1995), pursuant to NEPA. This EA evaluated the closure of
Governors Island for potential environmental impacts. The EA concluded
that no significant environmental impacts would result from the closure
of Governors Island and relocation of USCG commands under the preferred
alternative of standard maintenance.
    B. Governors Island is subject to special legislation incorporated
as part of the Balanced Budget Act of 1997 (Item 373:[17], Sec. 9101),
as signed by President Clinton. The act directs GSA to dispose of
Governors Island at fair market value no earlier than FY 2002. The
State and city of New York have the right of first offer to purchase
all or part of the island at fair market value. Disposition of the
island under the Action Alternative is in compliance with this
legislation.
    C. Since closure of the USCG facility, the island and its
structures have been maintained by a caretaker detachment of Federal
and contract personnel at an approximate annual cost of $6 million in
FY 1998 and $7 million in FY 1999, respectively. The responsibility of
continuing maintenance of Governors Island would be transferred to the
owner of the island upon disposition, thus alleviating the Federal
Government of the annual expenditure for maintenance of the island.
    D. The island is acknowledged to contain resources of historic
merit. In fulfillment of its consultation responsibilities under
Section 106 of the National Historic Preservation Act, GSA was a
signatory to a Programmatic Agreement between the USCG, the Advisory
Council on Historic Preservation, the New York State Historic
Preservation Officer, the city of New York, and the National Trust for
Historic Preservation. This agreement provides for the preservation of
the Governors Island National Historic Landmark District (GINHL) and
continuing covenants which will be binding upon the new owner of the
property. GSA is presently preparing the Governors Island Preservation
and Design Manual, which will become the governing document for all
future preservation and maintenance activities within the GINHL. The
obligation for adherence to the provisions of this document will be
transferred along with the island's title upon disposition. This
guarantees the future preservation of the GINHL after disposition.
    E. Disposal of Governors Island by GSA does not have any direct
effect on the physical, biological or manmade environment. Any future
reuse of the island would need to comply with any and all Federal,
State, and local regulations. If there were project-specific impacts at
that time, they would need to be disclosed and mitigated by the future
owner of the island.
    F. The USCG is currently completing all environmental closure and
clean-up operations in compliance with Federal, State and local
regulatory standards prior to disposal of the island. Full remediation
will have occurred by the time of transfer of the island, or the USCG
will continue such remediation after transfer as necessary.
    G. The FEIS provided recommended mitigation for any adverse
environmental impacts identified in association with the land use
options. However, mitigation for any such adverse environmental impacts
would be the responsibility of the future owner of Governors Island. A
specific development plan for the island would be subject to Federal,
State and local regulations that would ensure proper mitigation of any
associated impacts.

IV. Environmentally Preferred Alternative

    As required by NEPA, a lead agency must identify its
environmentally preferred alternative. The environmentally preferred
alternative is the alternative which best satisfies and promotes the
national environmental policies incorporated in Section 101 of NEPA.
The Action Alternative, disposition of Governors Island, is both the
preferred and the environmentally preferred alternative. By disposing
of Governors Island to another party, the Balanced Budget Act would be
adhered to, the property could begin to generate tax revenue (if
disposed of to a private entity) that might offset any maintenance
costs associated with the island, and the public could potentially gain
access to this previously secured facility. Disposal will also allow
for reuse of the GINHL in compliance with the Programmatic Agreement
and the Governors Island Preservation and Design Manual, ensuring the
appropriate maintenance and preservation of this resource. Disposal of
Governors Island would not have any direct adverse effect on the
physical, biological, or man-made environment, but rather beneficial
impacts could be realized as cited above. Any specific development plan
for the island would be subject to Federal, State and local regulations
that would ensure proper mitigation of any associated impacts.

V. Environmental Impacts and Mitigation Measures

    In terms of environmental harm and degradation, the Action
Alternative, disposition of Governors Island, would have minimal or no
adverse impacts to physical and natural resources, biological
resources, and man-made or socioeconomic characteristics. All practical
means to alleviate, minimize and/or compensate environmental harm were
considered.
    Under the first scenario of the Action Alternative, Governors
Island would be disposed of to New York State or New York City (NYS
and/or NYC) for fair market value no earlier than FY 2002. The
responsibility of continued preservation and maintenance of the
National Register Landmark District would be transferred to NYS and/or
NYC along with the island's title. Generally, properties owned by NYS
or NYC do not generate tax revenue. Under this Action Alternative
scenario, the change in public ownership would not necessarily
constitute an increase in tax revenue for the city or state. The
possibility does exist, however, that NYS and/or NYC would create an
arrangement on the island where some land uses would be privately
sponsored and would pay taxes. Similarly, if the island is disposed of
to NYS and/or NYC the burden of providing services on the island would
fall to local government. Transfer of the island to NYS and/or NYC
could enable public access to a portion of the city previously
unavailable to visitors and possibly create additional open space for
the city. It is not anticipated that the addition of Governors Island
to the NYC real estate market would adversely affect prices for
comparable properties, as the current real estate market is strong and
Governors Island possesses unique characteristics (size, location,
existing facilities). Under the Action Alternative, the sale of
Governors Island for fair market value would result in the Federal
government realizing a monetary gain. Additionally, the Federal
government's responsibility for caretaking on the island would cease
and the annual recurring expense for caretaking would end. Disposal of
Governors Island to NYS and/or NYC does not have any direct effect on
the physical, biological or man-made environment. Any future
development of the island by NYS and/or NYC would be subject to all
applicable Federal, State, and local regulations.

[[Page 6092]]

    Under the second scenario associated with the Action Alternative,
Governors Island would be disposed of to an entity other than NYS and/
or NYC for fair market value. The continued preservation and
maintenance of the GINHL district would be an obligation transferred
along with the island's title. Disposition to an entity other than NYS
and/or NYC under the Action Alternative could be beneficial in terms of
the creation of new tax ratables within NYC. Additionally, if profit-
generating uses occur on the island, these uses would generate sales or
corporate taxes, which would accrue to NYS and/or NYC. Provision of
police, fire and other municipal services to Governors Island would be
necessary, the cost of which could be offset to some degree by taxes.
The possibility exists that the island could be disposed of to a not-
for-profit institution at fair market value, or some combination of
not-for-profit entity. In this case the not-for-profit institution
would be exempt from paying taxes. This could result in a burden to
local services without commensurate tax relief. A Payment in Lieu of
Taxes (PILOT) could offset this burden. Under this scenario, the
Federal Government would realize the financial gains generated from
sale of the island, as well as the annual savings of the costs
associated with maintaining the island. Disposal of Governors Island to
an entity or entities other than NYS and/or NYC does not have any
direct effect on the physical, biological or man-made environment. Any
future development of the island by the new owner would be subject to
all applicable Federal, State, and local regulations.

VI. Supporting Information

    GSA has received a limited number of comments concerning the FEIS.
Upon review of these comments, I am satisfied that they have already
been sufficiently addressed in both the DEIS and FEIS. In support of
this, GSA has received notification from the Environmental Protection
Agency (EPA) that ``In light of the covenants that will be set forth in
the transfer deed, we have concluded that the proposed project would
not result in significant adverse environmental impacts; therefore, EPA
has not objections to the implementation of the proposed project''.
    The Port Authority of the State of New York and New Jersey has
requested that in reference to the Hazardous Materials Sections of the
``Re-Use Options'', GSA ``forbear from characterization of dredged
material absent actual sampling and testing''. The FEIS disclosed that
if dredging were determined to be necessary adjacent to the island in
connection with the construction of docks or piers, ``and the spoil is
contaminated, or is ocean-dumped, this may constitute an impact under
Section 103 of the Marine Protection, Research, and Sanctuaries Act''
(Governors Island Disposition FEIS, November 1998, pp. IV.E-9, IV.R-52,
IV.E-90, IV.E-109, IV.E-131). Because of the conceptual nature of the
land use options, it is not clear if dredging is actually necessary.
GSA did not intend to indicate that spoil material is contaminated,
rather that if the spoil were contaminated the potential for impact
could exist. In order to determine the nature of any spoil material
associated with dredging activities an actual sampling and testing
program would need to be undertaken.
    The Port Authority also indicated that the * * * disposition to New
York City or New York State is preferable to a private disposition and
should be evaluated as such in the decision-making process.'' As
indicated earlier, GSA has undertaken the disposition of Governors
Island as directed by the Balanced Budget Act of 1997. While the
Balanced Budget Act does provide the city and State of New York with
the right of first offer (at fair market value), it does not designate
a preference as to the purchaser of the island. In keeping with the
directive offered in this Act, GSA has employed a similar two-tiered
approach to the environmental review of the disposition of the island.
The potential benefits and impacts associated with disposition to New
York City and/or New York State as well as to a private/institutional
party have been fully disclosed in the FEIS. The selection of the
disposition alternative as the preferred alternative does not indicate
a preference as to the purchaser of the island yet it still allows the
State and or city of New York the right of first offer. I believe that
sufficient background information concerning the effects of disposition
to a public or private entity has been provided to the appropriate
parties in the decision-making process.
    Finally, a letter received from the Regional Plan Association (RPA)
indicates that ``[t]he DEIS does not adequately examine the
consequences of its action alternatives''. I disagree with this
assessment and am confident that the analysis of the action alternative
has been conducted and the impacts and benefits disclosed as required
by NEPA. As I indicated above, GSA has disclosed the impacts and
benefits associated with the disposition of the island to either New
York City/New York State or another entity. Additionally, in
conjunction with the action alternative, GSA has identified and
analyzed a range of reasonably foreseeable reuse options that could
occur on the island. In total, GSA has provided a sufficient level of
review of the consequences associated with the disposition of the
island.

VII. Conclusion

    Environmental and other relevant concerns presented by interested
agencies and private citizens have been fully addressed within the
FEIS. GSA believes there are no outstanding environmental issues to be
resolved with respect to the proposed project which are within the
mission capabilities of this agency.
    After consulting with GSA staff, reviewing the FEIS and all of its
related materials, it is my decision GSA will proceed with the disposal
of Federally-owned real property known as Governors Island, New York
Harbor, New York.

    Dated: January 27, 1999.
Robert W. Martin,
Acting Regional Administrator.
[FR Doc. 99-2722 Filed 2-5-99; 8:45 am]
BILLING CODE 6820-23-M
