BRAC gives housing developers pause

The announcement that the federal government will consider closing Army posts or shuffling soldiers among them has complicated the region’s efforts to build more housing as developers, wary of the uncertainty the process brings, watch the situation unfold.

But state and county officials are pledging to do whatever is in their power to assuage developers and make the case to keep the 10th Mountain Division at Fort Drum.

“I think that these housing developers are very much aware of what’s going on,” said Assemblywoman Addie J. Russell, D-Theresa. “I think Fort Drum looks very good as we go into this process, with the types of troops that we have here, and how important they are to the new role of our nation’s military, and how we need to function. I think that bodes well for Fort Drum.”

One thing is clear: The Base Realignment and Closure process will affect the housing situation in the greater Watertown area, whether it adds troops to Drum, takes them away, or withers on the vine. But it’s the particulars that are not clear, which has businesses, constantly weighing the costs and benefits of an investment, concerned.

“It’s raising the level of risk to any developer or person who’s financing these costs,” said Donald C. Alexander, CEO of the Jefferson County Industrial Development Agency. “You run the risk of having people not participate, or raising the cost of doing business because the risk is higher. We’ve answered questions about what the future of the fort might be as good as possible, and we’re trying to offer incentives for them to (make a deal) even through the risk is enhanced.”

Mr. Alexander declined to say what developers the agency is talking with, but did say the developers had been asking questions about the potential effect of a BRAC request from the Department of Defense.

Defense Secretary Leon Panetta made the BRAC announcement last week. Mr. Panetta cast the plan as crucial to reshaping the military amid the drawdowns in Afghanistan and Iraq. With the Army set to shrink gradually from 560,000 active duty troops to 490,000 by 2017, the Pentagon cannot afford to maintain base structure it does not need, Mr. Panetta said.

With a “one-element town,” as Mr. Alexander described it, Watertown’s housing demand is all about Drum, magnifying risks to the post.

Carl A. McLaughlin, executive director of the Fort Drum Regional Liaison Organization, said that the process — and the uncertainty — could last for some time.

“There’s a lot of data and analysis that goes into this, and there will likely be a huge gap between the announcement and getting the plan agreed on,” probably from 15 to 18 months, he said.

But even with the uncertainty caused by another BRAC round, several ongoing projects started in the past year have proven that developers are willing to set up shop here to meet the demand for housing, Mr. McLaughlin said.

He said the FDRLO will release a study on Thursday confirming that there is a shortage of 1,035 apartment units and that an additional 350 units are needed to have a healthy number of vacancies, in the area of 5 percent to 7 percent.

More than 700 apartment units are expected to be made available from housing projects slated to break ground in the near future, Mr. McLaughlin said, thanks to funding awarded by a committee of officials from the Development Authority of the North Country, JCIDA, FDRLO and Jefferson County.

Projects include COR Development Co. of Fayetteville’s 296-unit Beaver Meadows complex, south of Target in COR’s Towne Center, Route 3, and Morgan Management of Pittsford’s 394-unit complex off County Route 202.

Norstar Development USA’s Creek Wood Apartments, between Mill Street and Plaza Drive, is slated to have 96 units available by November to complete phase one, as well as an additional 105 units, expected to be ready in 2013, to complete phase two.

Another project slated for the coming years is a 402-unit expansion planned by developer Dawn Homes, Albany, at Jefferson Apartments in the town of LeRay, which would be completed in multiple phases.

In August, about 2,600 more soldiers were deployed overseas than are deployed today, Mr. McLaughlin said, and there is expected to be a shortage in housing throughout the spring and summer months as Fort Drum will have a “full nest” of soldiers with the return of its 3rd Brigade Combat Team, a total of 2,600 soldiers.

“When the 3rd Brigade returns, we won’t have any place to turn except to expand the market and look outside” the Watertown area, Mr. McLaughlin said.

Regardless of the BRAC proposal, Mr. McLaughlin said he’s optimistic that developers will continue to see Jefferson and Lewis counties as an ideal place to do business. Although the number of soldiers stationed at Fort Drum likely will be decreased, he doesn’t anticipate any major cuts to be proposed by Congress. According to a study by the FDRLO in January, there are 19,688 soldiers based at Fort Drum.

“Fort Drum should sell itself as the only major training facility in the Northeast section of the country,” he said. “As developers analyze this market, I think they will come to the same conclusion as others, that there is a potential for a good return on their investment.”

The idea of more military closures will put communities on edge, said Tim Ford, executive director of the Association of Defense Communities, which lobbies Congress on behalf of areas with military installations. But officials in those areas already were nervous, he said, because of the more likely prospect of deep cuts in defense spending and in the size of the Army.

“BRAC doesn’t have to be approved to do that,” Mr. Ford said.

The housing market already is difficult without the prospect of post closures or loss of personnel at installations, Mr. Ford said.

Communities already have been gearing up for a lobbying effort, Mr. Ford said. When word of big cuts in the Defense Department came out last year, military communities were on notice that reductions at installations were likely — and that was well before closures became a serious part of the discussion.

“We’re seeing that happening,” Mr. Ford said. “We’ve been telling communities for a while that they need to be engaged in this.”

The Drum community is no stranger to the BRAC process, which last occurred in 2005. The lobbying effort will shy away from the economic toll that a closure could have on a community. It’s all about the nation’s interest.

To that end, state and county officials are hoping to arm the officials who’ve been there before with the resources they need.

State Sen. Patricia A. Ritchie, R-Heuvelton, has asked the leadership in her chamber to insert FDRLO funding into its budget. The Senate comes out with a budget as part of a negotiating exercise with Gov. Andrew M. Cuomo and the Assembly.

She also questioned Kenneth Adams, CEO of Empire State Development Corp., about the possibility of state funding at a budget hearing. The state must finalize a budget by April 1.

“The governor understands the imperative of keeping Fort Drum, a thriving economic magnet for Northern New York,” Mr. Adams said at the hearing. “We are still trying to put together a response in terms of how we would do the work we know we’d need to do.”

Jefferson County also is pledging to step up to the bar.

“The resources of the county are always available to defend our position for hosting Fort Drum,” said Legislator Scott A. Gray, R-Watertown, who chairs the Finance and Rules Committee. “Whatever department needs to be involved, we would certainly commit both human resources, and last time we even committed financial resources. I wouldn’t see it as anything different this time.”

Times Washington correspondent Marc Heller contributed to this report.