South Side Ellis Island Fact-Finding Gap Analysis

South Side Ellis Island Fact-Finding/ Gap Analysis
Prepared by Glenn Eugster, Assistant Regional Director, Partnerships Office, National Capital Region

Final: October 15, 2004

Introduction

On March 9 Director Mainella requested the National Capital Region to assist the NPS Washington Office with an internal review of the fundraising campaigns for a variety of partnership construction projects greater than $5 million. The South Side of Ellis Island project in NY, within the Ellis Island National Monument, was one of the projects identified for assessment. This document is a report on NPS's fact-finding/ gap analysis.

Background

NPS had a series of discussions between the National Leadership Council, the House and Senate Appropriations Committees, the Development Advisory Board, and some of our park and regional offices about the relationship between public and private partnerships, park projects and NPS funding. During these discussions it has become apparent that there are inconsistencies in the way NPS structures, manages, implements and monitors some partnership agreements, including fundraising agreements, plans and campaigns, the relationship between these efforts, priorities for funding park projects, and communication with the Congress.

Specifically NCR was asked to examine the South Side of Ellis Island fundraising campaign, identify real and perceived problems and matters of concern, identify options to respond to the problems and concerns, and identify ways that NPS can assist parks and regional offices in building better partnership projects. This information is to be shared with NPS managers to assist them in their decision-making.

The approach used for this fact-finding and analysis involved a review of relevant documents made available by headquarters, the regional office and the park; personal and telephone discussions with key leaders; a meeting with park and regional office managers; and analysis of the information collected. It is important to note that the time schedule for this analysis was limited. Further research may reveal different facts and lead to additional or different conclusions.

Individuals that were contacted and provided information to this report include:

Chris Jarvi, Associate Director, Partnerships, etc.
Sue Masica, Associate Director, Park Planning, Facilities and Lands
Bob McIntosh, Associate Regional Director for Partnerships, NER
Chris Niewold, Acting Chief, and Shannon Stone, Partnership Staff, WASO Partnership Office
Cynthia Garrett, Acting Superintendent, STLI
David Luchsinger, Acting Deputy Superintendent, STLI

In addition, the report author participated in a June 1, 2004 NER Meeting on the proposed project with:
Marie Rust, Regional Director, Northeast Region
John Mauonis, Special Assistant to the Regional Director, Northeast Region
Cynthia Garrett, Acting Superintendent, STLI
Terrence Moore, Chief of Planning, Northeast Region
Bob McIntosh, Associate Regional Director, Northeast Region
Dan Wenk, Director, Denver Service Center
Karyn Ferro, Co-Chair, NPS Building Better Partnership Projects, National Partnership Office
Sue Masica, Associate Director, Park Planning, Facilities, and Lands
Chris Niewold, Acting Director, National Partnership Office
Peggy Halderman, Co-Chair, NPS, Building Better Partnership Projects, WASO, Associate Director, PIEVOR

Judy McAlpin of Save Ellis Island Foundation (SEI) provided information for this report at the request of NER/STLI.

Interviews were requested with Randy Jones, Deputy Director, WASO;
Don Murphy, Deputy Director, WASO; and Bruce Sheaffer, Office of the Comptroller, WASO but these individuals did not respond.

Facts

Park Name: Statue of Liberty National Monument and Ellis Island

Project Summary: NPS is currently evaluating three alternatives regarding the future of the vacant historic buildings of Ellis Island. A Development Concept Plan has been prepared, and shared with the public, to provide actions for NPS to take for long-term rehabilitation, reuse, and protection of cultural and historic resources. The plan relates directly to the objectives outlined in the 1982 Statue of Liberty National Monument General Management Plan.

Name of Partner: Save Ellis Island, Inc. (SEI). Incorporated under the laws of the State of Delaware.

PMIS: # None

Estimated Gross Cost: $300,000,000. Note: Acting Superintendent indicates that "this figure may not be solid".

Targeted Completion Date: 2011

Breakdown of Funds Needed:
NPS share: $9,000,000 for utilities infrastructure.
Other Federal Funds: $25,000,000 Federal Highways for a new service bridge
Private, Donated and State and local funds: $274,000,000
Operations Funds Needed: NPS anticipates that it would seek an OFS request for a $900,000 operational increase to the park base, in order to cover operations funding requirements as part of the Institute Business Plan currently under development
Cost-Offsets: Funds from leases and revenues anticipated from private sector partner will offset at least in part the operating funds needed.


Chronology and Status of Planning, Partnership and Fundraising Activities

2004 Revised General Management Plan planning underway

Development Concept Plan/ Environmental Impact Statement (DCP/EIS underway.
Status: A Development Concept Plan/ Draft Environmental Impact Statement for the Statue of Liberty National Monument and Ellis Island has been prepared by NPS to consider alternative adaptive reuses for the 30 remaining vacant and deteriorating buildings of Ellis Island and access to the island. The Ellis DCP/Draft EIS was released for public review and comment in July of 2003 and closed in September of 2003. The DCP/FEIS was submitted for publication in the Federal Register in August 2004 and is under review at NPS headquarters.

May 10, 2004 New Cooperative Agreement being developed. A Draft Outline, dated April 19, 2004, for the Cooperative Agreement (including a DO 21 Fundraising Agreement) with Save Ellis Island was provided to NPS headquarters and is currently under review.

April 20, 2004 Project Fact Sheet prepared and submitted by NER as part of the NPS Building Better Partnership Projects effort.

April 19, 2004 Draft Cooperative Agreement Outline prepared by NER/ STLI

January 30, 2001/ February 1, 2001 Agreement between Save Ellis Island and NPS signed by NPS-STLI and Save Ellis Island. The agreement calls for the preparation and NPS approval of several documents, including:

SEI agrees to conduct a feasibility study to determine the
likelihood of success.

Status: The fundraising feasibility study has not been approved by NPS. However, SEI indicates that a separate version of the feasibility and planning study can be made available if so requested. This document was requested but not yet provided.

SEI's feasibility and planning study, conducted by Changing Our World,
Inc. (CW), a New York based philanthropic consulting firm, commenced in
November and December 2003 with the planning, request letters and appointment setup work. Interviews were conducted by CW with over fifty SEI friends, supporters and prospective major donors during the months of January and February 2004.

An Interim Report was presented to the SEI board in late February '04, with the study being completed in late March and presented to the SEI board in final form at their late April 2004 meeting. The results of this study are incorporated into SEI's fundraising plan that has been submitted to NPS STLI, NER, and the National Partnership Office.

SEI agrees to develop and submit to NPS for review and approval a
fundraising plan.

Status: The fundraising plan has not been approved by NPS. Preliminary fundraising outlines were submitted to the NPS in prior years, but the Plan to be presented will be the most comprehensive and complete to date, incorporating the feasibility/planning study results and CW recommendations.

It must be emphasized, however, that SEI believes this Plan will continue to evolve and add detail as NPS approvals are secured, a Master Plan [for the reuse] is developed and approved, and Request for Proposals (RFP) results provide more accurate cost estimates, based on current market realities. For example, the $300 million "fundraising goal" was based on an updated number from the Sedway Group study in 1999-2000, and was agreed upon for use in discussions by both SEI and the NPS in order to reduce confusion among those hearing about the proposed plans for Ellis Island. An accurate goal amount will not be able to be fully determined until we are in receipt of actual bids from prospective [conference/retreat center] developer/operators many months hence.

In looking ahead to launching both the national awareness campaign and the fundraising campaign to follow, SEI prepared an initial outline for an expanded agreement between itself and the NPS. This agreement would cover both fundraising activities in support of the proposed reuse and the management (by a designated nonprofit organization) of a partnership between the National Partnership Office, SEI and the NPS-NER/STLI, for development and operation of the conference and retreat center in conjunction with the Ellis Island Institute.

Five planning charettes (2 on immigration, 3 on public health) have been hosted by SEI in recent years for panels of nationally recognized experts in these and related fields, and at least 2 additional charettes are being planned for spring, 2005. Internally, a draft strategic plan outline is being reviewed and considered by SEI as a major step in honing the concepts for the Institute. This plan, or a version of it, will evolve to include the results of the anticipated planning charettes and other studies and consultations with respect to the Institute and its planned activities and programs.

SEI agrees to develop, no later than 90 days after the date of the
agreement becomes effective (February 1, 2001), a financial management plan--which will be come a part of the fundraising plan.

Status: SEI's financial management plan was initially developed in a simple, straightforward format, reflecting the pre-campaign status of the organization. The NPS can expect to see SEI's more detailed Financial Management Plan by the end of September 2004.

In the absence of formal approvals from the NPS for the reuse plan, serious fundraising realistically could not be undertaken and the financial controls and management policies reflected the low-key aspects of the initial fundraising efforts. However, with the DCP/EIS finally in Washington, DC, and key campaign leadership being cultivated and recruited, a far more complex and detailed financial management plan is now warranted. With assistance from SEI's audit and accounting professionals and SEI's legal advisors, SEI currently is developing detailed and responsive budget formats, along with monitoring procedures and policies for compliance.

The advent of contractual obligations for aspects of the restoration and reuse also necessitates reviews of SEI's insurance coverage and with the help of certified insurance planners and consultants, a review and appropriate upgrades in coverage and internal policies is nearing completion. The recruitment of new campaign and board leadership may trigger a new and expanded Finance Committee, although additions to the committee's charge and policies are not anticipated at this time.
As with the Fundraising Plan, SEI anticipates that this document will continue to evolve as the campaign takes off and capital fundraising begins.

Two important studies are underway with respect to the proposed reuse: a) Master Planning Study (funded by the Port Authority and being conducted by E E & K) will supplement and update the results of the 18-month-long studies performed by The Sedway Group in 1999; b) the Blaustein School of Public Policy at Rutgers University is undertaking an economic benefit analysis, or impact study, for the proposed reuse.


NPS and SEI will develop a Donor Recognition Plan.

Status: The Donor Recognition Plan, to be developed jointly by NPS and SEI, is only in its beginning stages. SEI and NPS would hope to have the Donor Recognition Plan in full draft form before December 31, 2004, and finalized in the first month or so of 2005.

SEI will continue to collect information regarding donor preferences, and their relative priority, for recognition at the same time it is understood the NPS is continuing to review and update the policies in DO-21.

Fundraising activities shall not commence until NPS has approved, in
writing, these items.
Status: SEI is doing "small-scale" fundraising under the old agreement

Term of the agreement expires in five (5) years and may be renewed
for five (5) years
Status: The current agreement expires on February 1, 2006. A new agreement is being developed.

January 26, 2001 Letter from NPS Director to Regional Director, NER approving the South Side Ellis Island Fundraising Campaign.

January 17, 2001 note from Associate Director Kate Stevenson and Deputy Director Denny Galvin to NPS Director Bob Stanton recommending approval of South Side Ellis Island Fundraising Campaign.

January 16, 2001 Letter to Director from NER requesting approval of
The Fundraising Agreement.

December 6, 2000 Memo and information sheet (dated 11-22-99) from STLI to NPS-Associate Director Kate Stevenson on "Market and Financial Feasibility Study of South Side Ellis Island".
Status: May 1999 NPS, through the Statue of Liberty-Ellis Island Foundation's endowment, and with financial assistance from the NJ Governor's Advisory Committee on the Preservation and Use of Ellis Island, contracted with a real estate and urban economics consulting firm (the Sedway Group/ Naomi Porat Consulting) to conduct a market and feasibility study for the South Side of Ellis Island.

The market and feasibility study is a prelude to a process for
making a decision on reuse plans for the South Side and the Baggage and Dormitory (B&D) building on the North Side of the Island.

Stakeholder workshops were held in 1999 and January 2000. A
financial feasibility analysis of the two potential reuse scenarios is underway to analyze their relative financial sustainability, within the constraints of market conditions, development costs, and the specific buildings and site constraints of Ellis Island. A feasibility analysis was completed in December 1999.

The final report was originally proposed to be available in the late
winter of 2000. It was not officially released but information from it was used as background for the DCP.
Status: SEI is working with funds from the Port Authority to complete a new feasibility analysis that will be available in the fall 2004. Additional work is needed to truly assess the financial feasibility of the project.

In 1992 Congress appropriated $15 million for construction of a permanent bridge to link Ellis Island with Liberty State Park in New Jersey. In response to this, NPS prepared an internal draft environmental impact statement to evaluate alternatives. The DEIS was completed in August 1995 and was under internal review when Congress rescinded the appropriation for the bridge. Work on the DEIS was halted. Hold over language for the House and Senate versions of the Department of the Interior Appropriations Act include the following provisions related to South Side Ellis Island.

ADMINISTRATIVE PROVISIONS 14
…Provided further, that none of the funds appropriated to the National Park Service may be used to implement an agreement for the redevelopment of the southern end of Ellis Island until such
agreement has been submitted to the Congress and shall not be implemented prior to the expiration of 30 calendar days (not including any day in which either House of Congress is not in session because of adjournment of more than 3 calendar days to a day certain) from the receipt by the Speaker of the House of Representatives and the President of the Senate of a full and comprehensive report on the development of the southern end of Ellis Island, including the facts and circumstances relied upon in support of the proposed project:
pps. 25-26

Status: This language has reappeared in the Appropriations Act Committee Report every year since about 1996. As of this date NPS has not used any appropriated funding for these purposes. To date NPS has not responded to Congress's request for a report.

December 5, 2000 STLI presented agreement to DAB and received
"concurrence" for the Statue of Liberty & Ellis Island National Monuments, Draft Fundraising Agreement with Save Ellis Island. The Board concurs with the concept of private fundraising to support the rehabilitation and adaptive reuse of the South Side of Ellis Island with the understanding that specific development projects are subject to usual NPS review and approval requirements. One Advisor added, “This is a huge, ambitious project. The Park Service should ensure that the fundraising agreement protects the interests of the Federal government.” Another noted “Overall concept of agreement seems appropriate and very helpful to park and resource protection. Exact wording of agreement seems more a responsibility of legal, etc. review than D.A.B.”

October 31, 2000 Project Review Report, Construction Review Process

Project was initiated by a legislative language, FY ’97 Appropriations Act that the National Park Service submits a plan to Congress for the immediate stabilization and long-term preservation of the buildings and landscapes that make up the South Side of Ellis Island.

2000-2005 Strategic Plan completed

1982 General Management Plan completed

1999 Initial Market and Feasibility Study completed

In 1998, after the U.S. Supreme Court granted sovereignty over 80% of Ellis Island, former Governor Christie Whitman created an Advisory Committee on the Preservation and Use of Ellis Island. In January 2000, that committee issued a final report proposing an ethnic and public health learning center and conference/retreat center to host international seminars on medicine, government, education, science, business and humanities. The report also recommended establishment of a new non-profit to focus on raising funds for preservation of the remaining buildings on Ellis Island. Save Ellis Island was formed and, in January of 2001, a Memorandum of Agreement between SEI and the NPS was signed.


Assumptions

The context for this research includes the following assumptions, identified by NPS park, regional and headquarters leaders, about the fundraising campaign.

According to park and regional leaders, this project was the #1 park
priority before the attacks of September 11, 2001.

There are currently 30 vacant and deteriorating buildings on this
site; stabilization of all the remaining buildings is either underway or completed.

The government share in this project, the replacement of the
temporary bridge and the installation of utilities infrastructure to the south side of Ellis Island, are necessary whether or not the Development Concept Plan is implemented. Electrical service is required to address the security needs of those portions of Ellis Island, particularly those areas that face the Statue of Liberty directly. Water is also necessary to provide fire suppression to those areas of the Island.

The General Management Plan for this site, approved in 1982, is in
the process of being updated. The new GMP will adopt the Development
Concept Plan for Ellis Island.

The Development Concept Plan and Environmental Impact Statement(EIS)
for this site is proposed to be completed in the early fall of 2004. The plan includes ideas based on the approach NPS has been pursuing at Ft. Baker and proposes uses that are complimentary to Ellis Island’s historic themes.

Three alternatives were evaluated: 1) no action; 2) partners-day use; 3) overnight, institute. 250 guestrooms, dining, meeting/ conference facility, limited public access.

NPS regional and park leaders indicate that "Our partner (Save Ellis
Island Foundation) is ready to go with fundraising". They have the backing of the State of New Jersey who has already committed $10 million in funding to the project. The Foundation has hired a consultant and is waiting for DCP to be finalized before completing all DO21 fundraising requirements to determine what needs to be done. Everything is on hold until the DCP is approved.

Save Ellis Island is a relatively new organization. It was
established in May of 1999, a fundraising agreement was signed in 2001 with the NPS, and a new agreement is being crafted that will set out the parameters for SEI to be involved as the Management Partner as outlined in the Development Concept Plan.

Issues

Preservation, Restoration, Interpretation & Use
NPS has been attempting to involve the private sector in providing
funds to rehabilitate the remaining buildings on Ellis Island since the early 1980s. Regional and park leaders believe that "NPS can not take this project on alone." They indicated that "This is the last best chance for preservation. This is our last chance so the project doesn't come back for Congress to fund. This is it!"

Priority Setting and Relationship to Other Projects
NPS headquarters leaders feel that "NPS needs to step back to look
at priorities of NY area". In response to concerns voiced by Congressional Appropriation Committee staff members, headquarter leaders want to know how projects in the NY-NJ Harbor area are being prioritized and integrated? The Regional office is preparing an overview of various projects in National Parks of New York Harbor to set the partnership projects in priority. It is expected that this briefing will be completed before the end of October.

Park leaders believe that "the government's piece of South Side
Ellis Island has to be done irrespective of un-restored South Side Ellis Island. Infrastructure has to be done. Operations money will only be needed if project is successful".

In addition, headquarters leaders feel that South Side Ellis Island
has some similarities to what is being talked about on Governor's Island and they would guess that the likelihood of both projects succeeding is very small. Both projects want to eventually become conference centers with lodging for participants. In some ways, Governor's Island seems to be a more accessible site and one that seems more adaptable to the concept being proposed for both sites. Just the large amount of infrastructure that needs upgrading on the South Side Ellis Island site poses tremendous economic obstacles to any proposed project.

One NPS headquarter leader said that "South Side Ellis Island needs
to be viewed in terms of what is being planned for Governor's Island which is a site with tremendous potential".

Park leaders feel that the Governors Island Facility is not similar.
The size, scale, and concept of the facility being proposed at Ellis Island is significantly different that what may be proposed for Governors Island. They met with Governor's Island project leaders and then took them on a tour of EI and also have talked to Bernadette Castro, the Director of NY's Parks Dept. NPS park leaders believe "that project will involve a City/ State Conference Center that will have golf, other facilities". They said, "Our project has a different Conference niche--there are two different markets". They said "We hope to be finished before they start" and NPS does not expect to be actively involved with a conference facility at this (Governors Island) site. SEI is updating the feasibility study and will address this issue.

Budget and Costs
Park and headquarters leaders believe that "the big unknown with
this project is capital cost". The Acting Superintendent indicated that "the $300 million number may not be solid". Although stabilization will “buy” time for the structures, many of these structures would not survive the length of time it would take to obtain adequate funding to rehabilitate them through line item and repair and rehabilitation.

NPS headquarters leaders believe that "there is a perception by
regions that projects, such as this one, won't compete well". Proposals such as South Side Ellis Island are being pursued with outside funding because the regions don't believe that these projects are fundable in our current budget system. Headquarter leaders said, "Don't throw system out, delete new projects that aren't ready, and fund the ones that are". This is understood in concept but the line item construction program priority setting process discriminates against partnership projects. The cost of rehabilitating the buildings seems to make the project a poor candidate for the limited line-item construction project funds. Furthermore, the use of private funding to rehabilitate these buildings has been an approved approach since the park’s 1982 general management plan.

Leadership and Decision-making
Headquarter leaders believe that one of the primary questions about
this project is "who is speaking for the agency?". The NPS decision-making for South Side Ellis Island seems to have been done in bits and pieces without the entire project proposal ever coming before headquarter leaders. It is apparent that NPS partnership construction project review and approval is fragmented. The park and Region do not believe this is the case. There have been numerous briefings and discussions in WASO since this project was initiated in 1998. The Proposed DCP is the underlying foundation for this project. Regional office and park leaders believe that, "Once it is approved, the partnership development program process and the requirements of DO21 will be finalized".

Economic Development Aspect
Headquarters leaders feel that "the South Side Ellis Island project
appears to be an economic development strategy without a great deal of research having been done by the partner or the region". They asked, "How does NPS evaluate economic development proposals?" and believe that "if South Side is to be considered for development, there is going to need to be a lot more work done to determine the economic feasibility of such an effort". Park and regional office leaders believe that SEI is working to update the feasibility study that was done in 1999. They do not believe this is an economic development project – it is a resource preservation project.

One leader said "When I asked about the work done to determine
whether such a project was feasible, I didn't receive much of a response from the non-profit representative or the region. This project is less of a park rehabilitation project than it is an economic development effort and it should not be considered until the City of New York has weighed into whether they want such a project and whether they are willing to participate. And then, it needs to be viewed in terms of what is being planned for Governor's Island which is a site with tremendous potential". First and foremost, park leaders noted, this is a park and resource preservation project. The property in question lies within the State of New Jersey and is not dependent on the City or State of New York. This project was initiated by the National Park Service with significant support from former Governor Whitman. To date, the State of New Jersey has provided about $10 million for this effort.

Planning
Foundation leaders expressed concern about how long the DCP/EIS has
taken. They said, "It has gone on far longer than was originally planned, and far longer than is usual". They pointed out that the process slowed down considerably once the initial scoping for the DCP/EIS commenced in December 2000. They believe that "this has resulted in considerable challenges and dilemmas for SEI, as private sector donors expect to see results from their philanthropic investments and are not especially tolerant of continuing delays, no matter how sincere the explanation for them". Further, "with the recent "down" economy and the highly pressured competition for philanthropic funds in the private sector, funds to support the operation and fund the needed studies and analyses become very difficult to raise".

NPS Support & Priorities
According to park officials "the Foundation believes there is
support from the park but this is where it ends". Park leaders indicated that the park doesn't have anyone dedicated to SEI and it creates workload issues". They said, "We need a team of people" and they believe that, "In recent years, this project has taken a back-seat due to the STLI Re-opening".

Fundraising Agreements and Plans
Park leaders indicate that "the partner is doing limited fundraising
and that they are uncomfortable with waiting for NPS decision-making".

Regional leaders indicated that "There is an (fundraising) agreement
in place but it is out of date and moving to the next level". They said, "There is no Fundraising Plan. This will be sent to WASO".
Park leaders feel that there is a "Lack of WASO consistency in [decision-making, fundraising and partnership construction project] guidance".

Regional leaders indicated that "there is no donor recognition plan"
for this fundraising campaign.

NPS WASO and regional offices have not had a clear system for
monitoring the park fundraising agreements, plans and campaigns, since the SEI Fundraising Agreement was approved, to insure they are in compliance with the policies, procedures and standards set forth in the Director's Order #21.

Both the WASO Partnership Office and the NER Partnership Coordinator
positions have undergone considerable turnover during the last two years. The park feels that neither office has been consistently available to respond to park requests or provide staff or printed technical assistance (i.e. DO-21 Reference Guide to Donations and Fundraising).

Contingency Plans
Leaders from NPS headquarters want to know "What happens if private
fundraising fails?" One leader indicated that $12 million is a fairly basic NPS investment and said, "If they (the partner) don't raise the money, where does this leave NPS?"

Regional and park leaders believe that "The NPS piece of funding for this project is something the NPS will have to do anyway. The utilities infrastructure is needed to support the security and safety measures necessary for the Island. The replacement of the service bridge is needed for emergency operations and to support the present operations".

Readiness
Park and regional leaders believe that they are ready to submit for
agency and DOI review and approval.









Options
The following options can and should be taken to address the South Side Ellis Island fundraising problems and concerns within the identified assumptions.

Status of Reviews and Approvals of Agreements and Plans

1. Submit a complete project proposal to NPS headquarters for review and approval prior to any further decisions or action on this effort.

The South Side Ellis Island project has been reviewed in part by a
number of NPS offices. NER and STLI have received approval from the Director and from the DAB for the original Fundraising Agreement. Park and Northeast Regional Office leaders indicated that Deputy Director Randy Jones and Assistant Secretary Paul Hoffman of DOI reviewed this project a year ago.

Unfortunately the fundraising and DAB documents submitted for
approval are no longer consistent with NPS policy and are incomplete. Although numerous briefings have been provided during the past 5 years, at no time in recent years has NPS headquarters been provided a complete proposal for this project that fulfills the requirements of NPS fundraising, planning, development, or funding. Moreover, approval of the fundraising agreement was contingent on complete of a variety of documents that NER committed to prepare within 90 days of approval.

Much of this work was delayed on direction from the Regional Office until the DCP was prepared, reviewed, and approved. The documents that were to be completed, and still need to be reviewed and approved by headquarters, include a Feasibility Study, Fundraising Plan, a Financial Management Plan, and a Donor Recognition Plan. Moreover, the proposal does not reflect accurate cost estimates nor is there a specific "deal" describing the tasks and responsibilities that has been agreed to by NPS, SEI and Congress.

In addition, DAB's 2001 approval of the project seems to have gone
beyond this body’s responsibility in that it approved private fundraising that is not within the Board's responsibilities.

Park and regional office leaders suggest that decision making in
this project be separated into two distinct parts. First, is the approval of the DCP and once complete, that park and SEI will initiate work to finalize the requirements of DO21 and the interim guidelines on partnership development projects.

a. Request the NER Region to bring the current and future fundraising agreements and plans into compliance with DO-21 and the June 2004 Guidance for Partnership Construction Projects.
The proposed project does not comply with DO-21. At the present time it is being revised to comply with the Director's June 2004 Interim Partnership Construction Project Guidance.

Park and regional office leaders suggest that they hold a strategy meeting with NPS-WASO and the Save Ellis Island Foundation to identify where this project stands in the evolving DO-21 process and clarify the next steps needed.

b. The Region and headquarters should submit the proposed Development Concept Plan (DCP), and final EIS, along with a briefing paper, and partnership Fundraising Agreement and Plan to headquarters for review and approval.
Based on the strategy meeting noted above, NER should be sure to add language to DCP that references the General and Fundraising Agreement. The fundraising agreement and plan should be revised to define new roles and responsibilities for the SEI.

As noted above, park and regional office leaders suggest that decision making in this project be separated into two distinct parts. First, is the approval of the DCP and once complete, that park and SEI will initiate work to complete the requirements of DO-21 and the interim guidelines on partnership development projects. They believe that a delay in approval of the DCP will make it difficult for the rest of the work to move forward. They have suggested that clarifications be made to the DCP to address issues and concerns identified in this report as a way to move the project ahead.

Although this strategy is logical it is unclear how decision-making for the DCP, the June 2004 guidance and DO-21 are integrated and when NPS will make an agency commitment to this project and its details. It appears to some NPS leaders that approval of the DCP only provides endorsement of the project in concept and not in details. However, Congress is concerned that approval of the DCP in-fact publicly commits NPS and Congress to fund the project.

c. NPS headquarters should provide for an objective and independent private-sector review of the economic viability of the proposed project alone and in relationship to other similar projects within the NY-NJ Harbor area.
Given the magnitude of the proposal, its location, and the lack of economic development experts within NPS, the agency would be well served to hire an independent consultant to review the project proposal and supporting documents. Such a review would provide NPS, SEI and Congress with some assurance that an investment of this magnitude is warranted.

Discussions between park leaders and SEI have suggested that issuance of an RFP for the private development element of the project might be one way to provide a realistic assessment or indication of the viability of private investment in the project and the amount of fundraising needed to support the project.

d. NPS should respond to Congress's interest in South Side Ellis Island by responding to the 2000 Appropriations Bill request and by providing
the House and Senate Appropriations Committees with information on the relationship between partnership construction project proposals for State of Liberty, South Side Ellis Island, Castle Clinton, and other relevant projects. The report should clarify the commitments begin proposed, the priority of these projects within the NPS and President's budget, and the ability of NPS to manage these partnership projects. Park and regional office leaders indicate that the Region is preparing this briefing.


NPS Priorities
2. NPS needs to reaffirm the priority of the South Side Ellis Island Project, within NY-NJ Harbor, NER, and nationally, to demonstrate to park partners that the agency is committed and to provide Congress and the Office of Management and Budget a clearer sense of which projects are priority.
Regional Director Rust urged NPS "to be more future oriented. If we are moving into an era of a government part of partnerships we need to think through the pooling of funds idea further. We should shape future partnerships like NY-NJ Harbor. How can we guarantee we are behind these partnership projects? How do we prioritize? Park and regional leaders believe that there is no way we can take care of all of Ellis Island. We need to show some federal commitment--perhaps 10% of total".

a. NPS should give South Side Ellis Island a PMIS # and make this project an NPS priority.
Park leaders indicate that a PMIS statement is being prepared.

b. NPS should consider making South Side Ellis Island a partnership construction project case study.
The NER Regional Director wants to make this project the poster child for Building Better Partnership Projects.

c. NPS-NER should provide a dedicated number of skilled staff to work on this project.
Park and regional office leaders indicate that NER, the National Parks of New York Harbor office, and the individual parks will be collectively addressing this issue.

d. NPS-Headquarters should assign one person as a South Side Ellis Island liaison to work with NPS-NER and STLI to insure the successful completion of this project.
A lack of continuity and knowledge about the South Side Ellis Island Project is hindering NPS and partner efforts. Dedicating a senior staff person to be the point of contact for all project matters from the National Partnership Office will improve headquarters knowledge of the project and the improve review and coordination services.

An alternative to this option is for NER to create a temporary South Side Ellis Island "Desk Officer", perhaps modeled after Kayci Cook's work for the Alaska Region. The desk officer could help communicate, facilitate, "nudge" the review and approval process with WASO while representing NER and STLI interests.

Whatever mechanisms are used to improve communication, it is clear that regular dialogue between WASO, NER, the park, and the House and Senate Appropriation Committee staff is critical to a project of this size and nature.

Other Facilities
3. NPS should assess the relationship of the South Side Ellis Island Project to the proposed conference center and lodging facility at Governor's Island to ensure that NPS's effort will not be duplicative or conflict with City, State and private sector plans.
Headquarters would like to have NER and STLI provide more detailed and factual information about the relationship between South Side Ellis Island and Governor's Island. Park leaders indicate that this will be addressed with the revised feasibility study being prepared.

Contingency Plan
4. NPS needs to reach a better understanding between policy, regional and park offices about the need for "contingency plans" in partnership construction projects. There is no common agreement on the need for a contingency plan within NPS.
NPS headquarters sees the need to include a contingency plan in NPS Plans and agreements to protect the agency's interest in the event that fundraising campaigns fail. Headquarters leaders fear that if the partnership project is publicly announced and then fails NPS will be under pressure to complete the project using agency funds.

A park leader suggested that a contingency plan for this project is either the "No Action Alternative" in the DCP -- stabilization of existing buildings, which is not a long-term solution. The park and regional leaders believe that the partnership proposal allows for NPS to pullout with notice.

As more is understood about the financial feasibility of the project and the amount of fundraising that will be needed, a phasing plan and other contingencies should be developed for the project.
Park leaders suggest that a contingency plan will allow NPS and, or SEI to finish what is being done. For example, NPS could concentrate on a number of buildings and programming that is more manageable. A contingency plan would need to be developed for the remainder of the buildings. These ideas should be included in the DCP.



Partnership Relations
5. The NPS Director should verbally communicate with Save Ellis Island Foundation to reaffirm our appreciation of their contributions and our desire to make this effort successful.
NPS, at the highest level possible, needs to confirm or reaffirm that NPS is appreciative of the Foundation's continued support. NPS leaders should explain the importance of why the documents and decisions must be agreed to jointly and follow NPS guidance. During this dialogue it is important for NPS to indicate and demonstrate that the partner will be included in decisions that are critical to the new phase of this project.

Integrated Decision-making
6. Park and regional office leaders should work with WASO to develop
specific language and caveats for inclusion in the DCP to define
conditions that must be met for the proposed action to move forward.
This project and partnership would benefit from a more integrated approach to headquarters decision-making. By linking decisions that need to be made in planning, budget, fundraising, civic engagement would include confirming the funding commitments and roles and responsibilities (i.e. "The Deal"), potential staging options for the project as well as a contingency plan if sufficient funds cannot be raised by the private sector. The intention would be to minimize risk to the federal government and clarify that full Congressional funding of the rehabilitation is not an option.

Once this language, and the conditions, is agreed on with WASO, NPS should give priority to discussing the status of this project with the House and Senate Appropriation Committee so that they understand and are supportive of the DCP strategy. This briefing must be held before public notice and release of the DCP in the Federal Register. Regular Congressional briefings should follow to keep the Appropriations Committee informed and supportive of the project.

Park and regional office leaders are extremely concerned about potential for delays associated with NPS, Department of Interior, Office of Management and Budget, House and Senate Appropriations Committee review and approval requirements. Park leaders are worried about the impact such delays will have on the viability of the partnership with the Foundation and the project itself. Despite these concerns, and the need to be sensitive to them, Congressional direction to NPS is clear. It is in the best interest of NPS to keep Congress informed of this project and its status.