Fort Hood is the nation’s largest military installation. And it has another distinction: Almost all of its housing needs to be renovated or replaced.
It’s not exactly the cavalry to the rescue, but Army officials hope that a landmark program now formally launched will help solve the problem.
Here’s the plan: A private development firm will be responsible for managing Fort Hood’s on-post housing. It will renovate or replace substandard units and construct additional housing.
The front-end investment may be roughly $300 million. But housing allowances from soldier/tenants would represent a $4 billion revenue flow over a 50-year contractual period.
The Army estimates that a private contractor can eliminate all of Fort Hood’s inadequate housing in about 10 years, a task that, without privatization, might take 30 to 40 years. And even with an increase in housing allowances, the long-term savings to the Army are projected at $300 million.
“This is a bold, new innovative program that is going to dramatically improve Army family housing at Fort Hood and throughout the country,” said U.S. Rep. Chet Edwards (D-Waco), a longtime proponent of the privatization effort.
“Specifically, this will mean better houses and neighborhoods for Army families, but beyond that I hope is sends a message to our soldiers who make such tremendous sacrifices that we care about them .”
Fort Hood’s housing will be renovated and managed by Fort Hood Housing LP, a joint venture between Lend Lease Actus of Napa, Calif., and Trammell Crow Residential, of Atlanta, Ga. Actual construction could begin early next year.
The Army has long grappled with a shortage of affordable housing units. The cost of repairing or replacing substandard Army housing is estimated at $6 billion.
Legislation approved by Congress in 1996 made the privatization effort possible. It established a pilot program, known as the Residential Communities Initiative.
The RCI program involves three Army installations: Fort Hood, Fort Lewis, Wash., and Fort Meade, Md. Contracts for housing improvements at Fort Lewis and Fort Meade are expected to be awarded this year.
The Army also has presented a plan to Congress to extend the RCI program to 16 additional posts.
“I fully expect that not only is privatization is here to stay, but it will become the main vehicle through which Army family housing and Army residential communities will be developed for the long-term,” said Assistant Secretary of the Army Mahlon Apgar IV, who is responsible for installations and environment.
Apgar described Fort Hood as the largest of the Department of Defense’s privatization projects to date. It is also the first to use a new procurement process.
Traditionally, the Army might develop a detailed plan with very meticulous and detailed requirements. In turn, private firms would submit a detailed proposal and bid.
That often was a costly process for everyone who submitted a proposal, and paid off only for the firm that got the contract.
But with that approach, Apgar said, the Army didn’t benefit from the expertise, creativity and experience of private industry.
The new approach, known as a Request for Qualifications (RFQ) “starts with the premise that America’s housing industry, which is the most efficient and effective in the world, knows more than we do about designing, building and managing family communities,” Apgar said.
After a firm has been selected, a joint planning process begins, which also includes input from the local community, Apgar said. Getting such information should speed the privatization process.
“By the end of the year, we should be in a position to present that plan to our congressional oversight committees,” he said.
“And once the committees have approved, we’ll then move forward with our development partners.”
