Schumer Calls on Army Sec. McHugh to Work with Arsenal & Partnership to Develop Plan that Would Allow it to Use Rental Income to Reinvest in Campus & Keep Watervliet Viable

Press Release

Today, U.S. Senator Charles E. Schumer urged Secretary of the Army John M. McHugh to enable the local development corporation at the Watervliet Arsenal, called the Arsenal Business & Technology Partnership, to control a portion of the rental income they generate in order to reinvest it into the facility and continue attracting businesses. Currently all rental income and fees the Partnership generates from the businesses located there is sent right back to the Army for use in its base operations budget, instead of being used to bring additional jobs to the Watervliet facility. Schumer said that the campus generates more than $2 million per year in revenue, and a significant portion of that should go back to the Arsenal Business & Technology Partnership so the Arsenal can continue to grow. Schumer said there is precedent for this request, noting that this contractual arrangement exists in a number of Army Ammunition Plants, including Milan, Radford, Hawthorne, Iowa, Scranton, and Holston. Schumer said that securing this new arrangement is critical because, without a dedicated revenue stream, its long-term viability is not guaranteed. In addition to his letter to Secretary McHugh, Schumer is also seeking to add an amendment to the National Defense Authorization bill (NDAA), which would make this arrangement permanent as well. The NDAA will likely come up for a vote by the end of this Congress

"Being able to keep and re-invest $2 million per year in order to attract new businesses to the Watervliet Arsenal would go a long way in helping the site remain a viable, job-creating engine in the Capital Region for years to come. Plain and simple, the Arsenal Partnership should be able to keep the revenue it generates, instead of sending it back into the general Army coffers," said Schumer. "There is precedent for this type of arrangement, and there is no reason why the Watervliet Arsenal should be forced to function with one hand tied behind its back when other similar sites do not. The Arsenal & Business Technology Partnership has proven to be successful at attracting companies to the site, but they need resources to continue their work. There is major potential to create more good-paying jobs at the Arsenal, and I will fight tooth and nail -- as I always have for the Arsenal -- to make this arrangement a reality."

Schumer has long been a supporter of the Watervliet Arsenal and has looked for solutions to keep it viable. As the demand for cannon has decreased since the end of the Cold War, the Army has reduced its workload at the Arsenal and cut jobs from 1,700 in 1991 to 560 today. The Partnership was created to help bring in new companies to fill unused space and keep the campus a viable large scale employer. By rehabilitating, maintaining and using the unused space on the campus, this effort supports the Arsenal's "core mission" of building our nation's cannon. Just this year, Schumer worked with the Capital Region delegation to secure $30 million to support the production of artillery and cannon tubes at the Arsenal by offsetting some of their overhead costs and making their rates more competitive.

Schumer has worked for years with both the Arsenal and the Partnership in order to spur private investment and make use of the underutilized space on its campus. The Arsenal Business & Technology Partnership currently partners with 13 private companies, which employ 250 private sector employees on site. Schumer said that being able to access this revenue generated through rent and other fees--or even a portion of it--would allow the partnership to better invest in the historic facility and continue to attract private-sector companies to utilize the space, thereby ensuring the Arsenal remains a vital engine for economy.

Despite the positive impact and the jobs the Arsenal brings to the surrounding region, a constant, dependable revenue steam is needed if the campus is going to remain a staple of the Capital Region economy for years to come. As it stands, the site generates revenues in excess of $2,000,000 annually in rents and other fees. However, the bulk of this profit goes directly to the Army's base operations budget. This means that the Partnership cannot use this money, as it must be given to the Army, rather than reinvested in the Capital Region and on the Watervliet campus. That is why Schumer is pushing the Army to work with the Watervliet Arsenal and the Arsenal & Business Technology Partnership to develop a mechanism that would allow the Partnership to control the fees they raise for the purpose of reinvestment into the site.

Constructed in 1813, the Watervliet Arsenal has played a vital role in America's defense throughout its long history producing large bore cannon and a wide variety of other products for military needs.

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