Privatized military housing has been plagued with problems, residents say

An investigation from Mother Jones and the Project on Government Oversight details fraud and mismanagement by housing companies contracted by the Pentagon.

By Alexandra HartMay 10, 2024 2:41 pm,

Toxic mold. Pest infestations. Sewage backups. None of these are things you want inside your home. But for some U.S. service members, these issues were pervasive in privatized military housing complexes, outsourced by the U.S. military and run by corporations.

Some families say they’ve lost all their belongings and even fallen ill from the living conditions, according to an investigation published in Mother Jones.

René Kladzyk is an investigator with the Project on Government Oversight, which co-published the story with Mother Jones. She spoke with the Standard about the problems tenants face, and why they have persisted for so long.

This transcript has been edited lightly for clarity:

Texas Standard: First, tell us how this privatized military housing works and how military housing is outsourced in the first place. 

René Kladzyk: Well, back in the 90s, the Department of Defense was facing a $20 billion maintenance backlog in their housing stock. And so they thought a good solution would be to outsource housing, get a major influx of funding from outside investors. And so, as a result, 99% of military family housing is now privatized. 

That is amazing. I had no idea it was that widespread. How many military members and their dependents live in them? Do you have any raw numbers? 

Roughly 700,000 service members and their families live in military family housing. 

So, what are some of the most common complaints and issues that you’ve heard about from those families you spoke with? 

I’ve spoken with dozens of service members around the country, and I’ve heard really harrowing stories of families losing all their belongings because of what they believe is mold contamination. I’ve spoken to multiple people who’ve had their pets die or become seriously ill. Stories of service members with small children who have a range of health issues that they link to housing conditions. 

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I have to say, I think a lot of listeners would wonder, how is it that these problems were allowed to get so bad, or are there a few bad players, bad contractors? And does the Department of Defense know? 

Well, something that we get into in the investigation is the nature of the contracts that underpin the privatized military housing system. Most of these contracts are 50 years long, and they’re incredibly difficult to cancel.

So in the case of some housing companies, they’ve already been found guilty of defrauding the U.S. government, falsifying maintenance records on the houses. But they still hold these contracts. 

But I mean, if they are providing substandard housing, housing that’s causing all this damage, surely that would mean that the Department of Defense could go elsewhere, no?

In the words of one Congress member, these companies can consider fines for fraud “just a cost of doing business.” That was Representative Debbie Wasserman Schultz, and she was referencing Balfour Beatty, which is one of the largest military housing companies that was found guilty of defrauding the government.

They continue to hold lucrative contracts with the government. And a Senate probe, since they pled guilty, found that they were continuing with the same allegedly fraudulent practices. 

How big a deal is this on Capitol Hill, from what you can tell? 

I mean, it’s been an ongoing source of focus and efforts to improve oversight. But, you know, among the advocates and military housing lawyers I’ve spoken with, to what extent those oversight efforts have been effective is another question, or whether they’ve fallen short.

Well, what sort of recourse do tenants and former tenants of these types of housing have? 

Hundreds of service members and their families have filed lawsuits against the companies. And then there are other kind of official channels that they can pursue for recourse.

But as a previous investigation of mine found, some of those official channels are rigged in favor of the housing companies, in part because these companies have had a hand in drafting the very oversight measures that are intended to protect service members. 

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