CFR > Title 32 - National Defense > SUBTITLE A—Department of Defense > CHAPTER I—OFFICE OF THE SECRETARY OF DEFENSE (parts 1 to 399) > SUBCHAPTER H—CLOSURES AND REALIGNMENT (parts 174 to 179) > PART 174—REVITALIZING BASE CLOSURE COMMUNITIES AND ADDRESSING IMPACTS OF REALIGNMENT > SUBPART D—Real Property (§174.7 to §174.12) > 174.10—Consideration for economic development conveyances.

174.10—Consideration for economic development conveyances.

(a) For conveyances made pursuant to § 174.9 of this part, the Secretary concerned will review the application for an EDC and negotiate the terms and conditions of each transaction with the LRA. The Secretary will have the discretion and flexibility to enter into agreements that specify the form of payment and the schedule. The consideration may be in cash or in-kind and may be paid over time.
(b) The Secretary concerned shall seek to obtain consideration at least equal to the fair market value, as determined by the Secretary.
(c) Any amount paid in the future should take into account the time value of money and include repayment of interest.
(d) Additional provisions may be incorporated in the conveyance documents to protect the Department's interest in obtaining the agreed upon consideration, including such items as predetermined release prices, or other appropriate clauses designed to ensure payment and protect against fraudulent transactions.
(e) (1) An EDC without consideration may only be made if—
(i) The LRA agrees that the proceeds from any sale or lease of the property (or any portion thereof) received by the LRA during at least the first seven years after the date of the initial transfer of property shall be used to support economic redevelopment of, or related to, the installation; and
(ii) The LRA executes the agreement for transfer of the property and accepts control of the property within a reasonable time after the date of the property disposal record of decision.
(2) The following purposes shall be considered a use to support economic redevelopment of, or related to, the installation—
(i) Road construction;
(ii) Transportation management facilities;
(iii) Storm and sanitary sewer construction;
(iv) Police and fire protection facilities and other public facilities;
(v) Utility construction;
(vi) Building rehabilitation;
(vii) Historic property preservation;
(viii) Pollution prevention equipment or facilities;
(ix) Demolition;
(x) Disposal of hazardous materials generated by demolition;
(xi) Landscaping, grading, and other site or public improvements; and
(xii) Planning for or the marketing of the development and reuse of the installation.
(f) Every agreement for an EDC without consideration shall contain provisions allowing the Secretary concerned to recoup from the LRA such portion of the proceeds from its sale or lease as the Secretary determines appropriate if the LRA does not use the proceeds to support economic redevelopment of, or related to, the installation for the period specified in paragraph (e)(1) of this section.