MUNICIPAL PARTNERSHIPS

1. MUNICIPAL PARTNERSHIPS Much harder than it sounds, but worth the effort! Lessons learned from a pilot program participant

2. Background Pilot Programs at Fort Huachuca and Fort Gordon Authorized by Section 325, Title III, FY 2005 Defense Authorization Act Under auspices of Office Asst Sec Army Installations and Environment Based on success of Presidio of Monterey and City of Monterey model program

3. Fort Huachuca A Community of 22,600+ Active Duty 5,517 Military Family Members 5,694 AZ Financial Impact over $2B Civilian Workforce 6,112 • Largest Employer in Cochise County • Largest Employer in Southern Arizona A Workforce of 11,600+ Military Retirees + Family Members 5,282

4. Presidio of Monterey Ord Military Community 392 Acres 2,800 Residents 87 Family Housing Units 33 General Instructional Bldg 20 Barracks 2 Dining Facilities 1 Physical Fitness Center 1 Recreation Center 1 Movie Theater 1 Troop Store 1 Learning Resource Center 771 Acres 5,500 Residents 1,588 Family Housing Units 1 Commissary 1 Community Center 1 Post Exchange 1 Library 2 Child & Youth Services Centers US Army Garrison Presidio of Monterey Stilwell Kidney (103 Acres) Former Ft Ord 14,244 Acres Remaining 1,400 Buildings 12,770 Acres Transferred (as of AUG 05) Naval Postgraduate School Fleet Numerical/Naval Research Lab La Mesa Village 589 Family Housing Units

5. FORT HUACHUCA / SIERRA VISTA 73,142 Acres 6,792 Residents 1,126 Family Hsg Units 24 General Instruction Bldgs 19 Barracks 8 Army Lodging 3 Dining Facilities 2 Physical Fitness Centers 505 Other non-AFH Buildings 1 Golf Course 4 Parade Fields 15 Athletic / Ball Fields 15 Training Ranges 3 Pools 1 Riding Stable 1 Arena 1 Cemetery 1 Airfield 1 Assault Air Strip 2 UAS Runways Population ~2,000 Population ~42,000

6. Monterey/Huachuca Differences • Small post surrounded by large city vice large post with small city on edge • High local wage rate • Not happy with existing Navy support • City excess capacity? • Imminent BRAC risk = motivation?

7. Authorized Municipal Partnership Areas • Refuse Collection • Refuse Disposal • Library Services • Recreation Services • Facility Maintenance and Repair • Utilities

8. Existing Federal or Municipal Partnerships • Joint Use Airfield • Traffic Signal maintenance • Parks and Recreation/MWR joint events • Emergency services mutual support agreements • Electrical privatization awarded in 2005 • Installation Transit System provided by city • Upper San Pedro Partnership: Environmental consortium addressing post water legal liability issues • National Forest Service tanker base/support agreement • DHS Customs Border Patrol operate from FH • Great partnership with Nature Conservancy

9. Initial Results/Lessons Refuse Collection: • Current contractor 47% cheaper than city bid. • Service Contract Act wage rate issues • City did not modify standard rate structure (i.e. treated Fort as normal customer) • Note: Contractor uses older trucks purchased from city Lesson learned: Must break “rate structure” mold and look at “strategic” value added for both parties in a partnership. City should consider “incentives” as they would in “courting” a new business

10. Initial Results/Lessons Street Sweeping: • City bid of $291 per hr as compared to $16 per hour current contractor • Conditions for contractor and city may not have been identical • Need to understand all “hidden” costs Lesson Learned: Work together to develop statement of work and negotiate items instead of specified items by govt. Understand complete rate structure including labor, equipment, overhead etc.

11. Municipal Partnership “legal” Obstacles Davis Bacon Act (DCA) Wages for Construction and Service Contract Act (SCA) Wages for Services: • Federal Govt required to pay DCA or SCA wage rates for work done on Federal installation • City wage rates in Sierra Vista significantly less, in some cases 50% less than applicable SCA rates • “Prevailing wages” for Sierra Vista based on Phoenix per Dept of Labor. • Also “prevailing wage” rates based on union wage rates despite AZ being a right-to-work state

12. Municipal Partnership “legal” Obstacles Compliance with Federal Acquisition Regulation (FAR): • Army Contracting Agency tends to view Municipal Partnership through “lens” of normal contracting process. • SJA reads as “should deal with municipal entity in business like manner and protect Army’s interest with goal of obtaining a best value contract” • Adding city to “bidders list” is not municipal partnership • 31 USC 6303 states “executive agency shall use procurement contract as the legal instrument reflecting a relationship between US Government and a State, local government or other recipient……

13. Compliance with Federal Acquisition Regulation (FAR): Huachuca Approach: • Develop Statement of Work in conjunction with municipal SMEs. City provides cost estimate. Installation can determine “best value”. Potentially can “test drive” service to determine validity of best value. • DD Form 1144 Intergovernmental Agreement may be alternative approach i.e. Joint Use Airfield documentation • Memorandum of Agreement may be appropriate in some cases if not a procurement action

14. Potential Win: Library Services • Initially studied City operating Post library as “branch” of city library system • Army funds $392 per year for post library • Initial cost to meet City standards $813K, annual operating costs $428K • City library exceptional, Post library sub-standard. • 80% of Fort personnel live in local community. • New direction: Fort partners with city to provide library services. Fort library closes. Army provides $60K a year to city to support unique Army requirements. All use the city library for library services • Results in $350K per year savings and BETTER SERVICE!

15. Airfield Crash Truck • Critical shortfall of required Army Crash truck • Major safety risk • $800K New fire truck provided by city to FH • Funded by FAA and AZ Dept of Transportation Grants to City of Sierra Vista • City provides all maintenance • Operated by FH Fire Dept Why do we want to fight good ideas?

16. What's Next for Us? • Relook refuse collection at contract option year. • Recycling: Include in refuse collection? • Road striping • More airfield services • Animal Control (New city facility in 07) • Emergency Services (Consolidated 911 dispatch by city?) • Grounds Maintenance • Expand partnership to opportunities to County Government (roads and grounds) • Enhanced Use Lease projects • Arizona Military Installation Fund Projects • Expand Inter-Agency support base and agreements

17. Lessons Learned • Legislative authority is very restrictive • Treat project development as a “discussion” with partner not contract “negotiation” when developing projects/SOWs • Must understand city rate structure to include salaries, overhead, benefits, and equipment in “pricing” services • Bring Contracting and SJA reps in at first discussion. Both city and government. • Understand Davis-Bacon/Service Contract Act implications • Must dedicate staff/time to work partnership issues • Municipality must have “advocate” spearheading issues, without “buy-in”, won’t happen • Must be Commander’s and City Manager’s priority!

18. So Why Do It? • Potentially significant savings to government • Stability…not changing contractor every few years • Usually a municipality core competency • Does excess capacity exist in municipality? • Strengthens bonds between community and military installation • Adds stakeholders in installation’s future • “Strategic Value” for community • “Success breeds success” Must be willing to engage head on and fight through every obstacle. The wins are worth the effort!