Puerto Rico braces for the base closing

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SAN JUAN, Puerto Rico -- After 60 years, the U.S. Navy yesterday officially closed its sprawling Roosevelt Roads Naval Air Station in eastern Puerto Rico -- already dropping property values and flooding the surplus housing market.

In the short term, Puerto Rico expected to suffer with closure of the base, which pumped an estimated $300 million a year into the U.S. commonwealth's economy. Long term, nearly 4 percent of the island's land area will be available for tourism, housing and industrial development.

Rosy Roads, as the military installation has long been nicknamed, was shut because the Navy could no longer use the nearby island of Vieques for bombing practice after May 2003. At one time, as many as 10,000 soldiers, civilian employees, outside contractors and their dependents lived on the base, though that number has shrunk throughout the years.

The Puerto Rican government is giving the nearby municipalities of Ceiba and Naguabo $1.2 million each to make up for what they lost in gross sales and excise taxes. A skeleton staff of 200 Navy personnel will maintain the base and keep it secure until it is disposed of sometime in late 2005.

"We're trying to make the best of it," said Milton Segarra, Puerto Rico's secretary of economic development, in a phone interview from San Juan. "We're talking about a once-in-a-lifetime asset management opportunity that could bring a significant positive impact to our economy."

As of Sept. 30, when President Bush signed legislation directing the Navy to close the base within six months, the naval base's population had already dropped to about 4,500.

"Rosy Roads supported the Vieques bombing range, and with the closure of that, the requirement for a support base evaporated," said David MacKinnon, associate director of the Pentagon's Office of Economic Adjustment.

"Any base closure that removes jobs from an area will have at least a temporary negative effect," Mr. MacKinnon said. "The military people will all go somewhere else, and their dependents go with them. Our role is to help make a transition from a military facility to a civilian one through technical and financial assistance."

About 85 percent of the base lies in the municipality of Ceiba; the remaining 15 percent is in Naguabo. As such, the nine-member local redevelopment authority includes the mayors of both towns as well as private and public-sector officials.