Military Housing Still Unsafe for Families Served by Company That Pleaded Guilty to Fraud, Congressional Investigation Alleges

A private company that pleaded guilty in 2021 of falsifying maintenance records for some of the 43,000 houses it manages for the Defense Department continues to ignore residents' concerns over mold, asbestos and other problems, endangering their health and safety, a congressional investigation has found.

Base residents at Fort Gordon, Georgia, and elsewhere reported moving into homes that weren't cleaned between tenants and were ridden with filth and pet hair, contained extensive mold or had exposed asbestos in crumbling ceilings and broken floor tiles.

When they requested repairs or other maintenance from the management company, Dallas-based Balfour Beatty Communities, they encountered a "lack of concern," according to a report released Tuesday by the Senate Permanent Subcommittee on Investigations.

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"The Subcommittee uncovered numerous specific instances where Balfour's housing practices since 2019 put military families' health and safety at risk," said the report titled Mistreatment of Military Families in Privatized Housing.

Balfour Beatty provides housing in 26 states to 150,000 military residents. On Monday, a spokesman said that the company had not received a copy of the report, but that it takes issue with the charge that Balfour Beatty continues to engage in the practices for which it was found guilty. They added that they respond to requests for maintenance “promptly.”

“The company has put in place rigorous new compliance and assurance procedures to prevent such behavior. In addition, it has implemented strict mold control procedures, and has devoted a great deal of time, effort, and money to ensuring that work orders are properly entered into [our system,]” a Balfour Beatty spokesman said in an email to Military.com

Balfour Beatty was ordered in December to pay $65.4 million in fines and restitution after being found guilty of fraud, having manipulated maintenance records from 2013 to 2019 to obtain performance bonuses as a housing management contractor.

The Senate committee said the mistreatment of service members and families by the company continues, and according to the report, the behaviors uncovered after 2019 "bear striking similarities to the types of conduct which Balfour admitted to in its December 2021 guilty plea."

"The subcommittee uncovered numerous examples of inaccuracies and omissions in ... Balfour's internal work order data tracking system after 2019, when the company initially vowed to correct these problems," the report said.

The investigation is the latest chapter in an ongoing scandal that began in 2018 over the condition of military housing, when systemic issues came to light in a series of reports by Reuters over the presence of mold, lead-based paint and other dangerous living conditions in base housing managed by private companies.

Military families have filed lawsuits and testified before Congress since 2019 on their poor housing conditions, noting that the companies often ignored maintenance requests or took shortcuts in repairing their homes.

Following a series of congressional hearings, military leadership pledged to improve its oversight of these companies, which hold 50-year contracts. The Defense Department developed a tenant bill of rights, unveiled in June, 2021 that gave residents more leverage with their landlords and the ability to negotiate disputes.

But according to the report, some residents are still powerless to have their homes repaired and continue to live in conditions that affect their health.

In a hearing on the report scheduled for Tuesday, an Army officer will testify that his eight-year-old daughter developed eczema as the result of living in a moldy home. Repeated complaints went undocumented in the company's work order tracking system. And when the family moved out, they received a collection notice from the company.

Multiple families at Fort Gordon reported 'resistance' from Balfour when they asked about potential mold in their homes, according to the report. One family noticed a strong musty smell and discoloration in a bathroom floor but Balfour employees that visited the home "discounted the concerns."

After months of requests, the company agreed to remove the floor, only to find what appeared to be "excessive black mold."

In addition to finding that Balfour employees ignored families and put their health at risk, the committee, chaired by Sen. Jon Ossoff, D-Ga., also determined that Balfour Beatty's work order data continues to be "incomplete, inaccurate and misleading."

According to the report, the committee identified issues with the company's repairs database "from 2020 until as recently as early 2022."

"In several cases, [the committee] found work orders relating to mold, for instance, were inaccurately entered as 'interior repairs,' 'painting,' 'plumbing' and 'carpentry' issues," staff members noted.

According to the report, Fort Gordon was not the only installation affected. A family at Sheppard Air Force Base in Texas also reported that after their water heater broke, resulting in flooding, subsequent mold growth was ignored, with the company hiring an industrial hygienist to conduct an assessment without ever visiting the home.

As a result of the initial revelations of poor housing conditions, the services have contracted with third party inspectors to examine their housing stock. The Navy and Marine Corps expect to have more than 62,000 base homes inspected by October, while the Army anticipated completing its inspections by last September.

The Air Force conducted its inspections in 2019.

Lawmakers have complained that the Defense Department and the military services ceded oversight of base housing to the management companies when DoD entered into the public-private ventures in the late 1990s.

Ahead of the hearing, Ossoff released a video trailer on the investigation. "Servicemembers and their families put it all on the line for our country. But are they being mistreated by the private companies responsible for their housing?" the video asks.

The Senate hearing is scheduled for 10 a.m Tuesday and will be streamed online.

-- Patricia Kime can be reached at Patricia.Kime@military.com. Follow her on Twitter @patriciakime.

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