DTI CONFERENCE CASE STUDY – Louisiana Army Ammunition Plant Transfer

1. DTI CONFERENCE CASE STUDY – Louisiana Army Ammunition Plant Transfer Doug Borgeson Managing Partner 563.355.4406 dborgeson@qwest.net

2. PURPOSE This discussion is designed to provide a brief outline of the history, terms and conditions for the conveyance of Louisiana Army Ammunition Plant (LAAP) to the state of Louisiana

3. HISTORY OF LOUISIANA AAP • Plant Built to Support World War II • Government Owned Contractor Operated (GOCO) Facility • Produced Artillery Shells for Korea, Viet Nam and Cold War • Located on 15,000 acres in NW Louisiana, Near Shreveport, LA • Plant Employed 1,500 People During 1980’s Production • Plant Laid Away 1990 (Employment 50) • Utilized ARMS Program 1994-2004 • Tenants Used parts of Facility Under ARMS

4. HISTORY- Continued • Louisiana National Guard (LNG) was one of Tenants Youth Challenge Program (YCP) Training Facility for State Guard Units Limited Number of other State Agencies • LNG/State Expressed Interest in Facility Ownership • A Partnership, NOT a BRAC Action • Army/State Began Discussions Late 2003 • Agreements Reached in Mid 2004 • Legislation Authorizing Transfer FY 2005 (Oct 2004) • Transfer Effective January 2005

5. TRANSACTION OUTLINE • Real Property Transferred to LNG/State • Army Retained Option on Some Equipment • Equipment Not Claimed Became State Property • Army May Reclaim Land for DOD use for 20 Years • State Agreed Remediation to Industrial Standards • State Accepted Responsibility for Environmental Monitoring • Army Accepted Responsibility for all Existing Environmental Conditions • State Accepted all Tenants and Tenant Agreements • All Revenue From Tenants to State/LNG • Federal Employees Offered Retirement/State Employment • Both Parties Benefited From Transaction

6. BENEFITS TO STATE & LNG • Economic Development Model Already Working at LAAP • Jobs Generated by ARMS Remain on Site • Existing Tenants Gain Ability to Expand • Ability to Bring New Tenants to Camp Minden • Reduction in Operating Costs of YCP • Reduction in Training Costs for LNG • Guarantee of Training Site Availability • Revenue From Tenants • Revenue from Timber Operations • Control of Facility/Infrastructure

7. BENEFITS TO DOD/ARMY • Removal of Property From Records • Elimination of Environmental Monitoring Cost • Elimination of Staff • Reduction Remediation Costs • Elimination of Demolition Costs • Elimination of Annual Maintenance Costs • No Production Break for DOD Tenants on Site • Ability to Use Property in Emergency (Katrina)

8. CONCLUSIONS • Both the Army and Louisiana benefited from the conveyance of Louisiana Army Ammunition Plant to the State/National Guard. • This is a repeatable ownership transfermodel for other DOD Installations.

9. CASE STUDY LOUISIANA AAP • This has been a very brief overview of the conveyance of Louisiana Army Ammunition Plant to the State of Louisiana. • Discussion/Questions