President Barack Obama does not support a proposal that would release Treasure Island to The City for free, according to a letter from his administration.
A provision in a bill authorizing national defense funding in 2010 would have instructed the military to give away dozens of closed bases, including Treasure Island, to local governments at no cost.
The provision would finally bring to a close 13 years of negotiations between The City and the Navy regarding the island, which the Navy operated as a base until 1993. The provision has gained support from Republicans and Democrats in the House and Senate, including Speaker Nancy Pelosi, D-San Francisco.
But in a letter to senators who supported the provision, Dorothy Robyn, deputy undersecretary of defense for installations and the environment, said the Obama administration does not support the proposal.
Robyn said there are already provisos that allow the military to release land at no cost when it sees fit, but she said it's not be appropriate in every situation. She wrote that if the federal government gave away all unused military spaces, local redevelopment agencies could "flip valuable properties they obtain at no cost for profits that can be used for purposes unrelated to redevelopment of the property."
The provision "could create potential windfalls for certain communities with high value property, and for private sector developers working with those communities, at the expense of other communities where the Department of Defense might otherwise be able to accelerate environmental cleanup" using the proceeds from a sale, Robyn wrote.
According to Pelosi's press secretary, Drew Hammill, the provision "has strong bipartisan support" and would "ensure the creation of thousands of new jobs" in two dozen communities currently negotiating for closed military bases.
Michael Cohen, executive director of the San Francisco Mayor's Office of Economic and Workforce Development, has been negotiating with the Navy on behalf of The City. He said his office still supports the provision, which he described as "low-lying stimulus fruit" that would help bring jobs to the region.
Cohen denied that the provision would provide any kind of windfall for either The City or the developer, and he said it would instead help create jobs and finally bring to an end to a "13-year odyssey" to gain ownership of the island.
He said his team has continued to negotiate a price for the island and is "cautiously optimistic" that a figure will finally be pegged by the end of the year, even if the defense provision does not pass.
"We've been fighting for this because we think it's the right thing, we think it's a fight that's worth fighting, but we aren't putting all our eggs in one basket," Cohen said.