'We're Not Perfect,' Military Housing Company Tells Congress Amid New Claims of Mold, Unsafe Conditions

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A maintenance worker for Balfour Beatty Housing.
A maintenance worker for Balfour Beatty Housing power washes a driveway of a home a military residential community< march 18, 2019. (U.S. Navy photo by Mass Communication Specialist Seaman Marianne Guemo)

The Balfour Beatty Communities military housing company told Congress on Tuesday that most residents are happy with its units and that it has no systemic failures, despite new testimony from residents who said unsafe conditions made them sick and a Senate investigation that found mold, asbestos and other problems.

The company, which manages more than 43,000 military homes in 26 states, was the subject of a newly released eight-month investigation by a Senate Homeland Security and Government Affairs panel. It found the poor living conditions have continued even after Balfour Beatty was caught up in a nationwide scandal over squalid family housing in 2019 and it pleaded guilty last year to falsifying maintenance records.

"Our performance metrics indicate the overwhelming majority of our residents are happy with their home and the service we provide," Richard Taylor, the Dallas-based company's president of facility operations, testified to the Senate panel on Tuesday.

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But he rejected allegations of substandard conditions throughout the company's network of housing units, which serves 150,000 military personnel and family members. "Things go wrong. We don't always get it right the first time. We're not perfect. We've never testified that we are a perfect organization," he testified.

Military tenants were also called to testify at the Senate hearing and painted a different picture of the housing. Army Capt. Samuel Choe said his daughter has suffered skin problems as the result of living in Balfour Beatty housing at Fort Gordon, Georgia.

"My daughter's skin, once youthful and supple, is now reptilian in nature to where there are numerous times she will wake up in the middle of the night, hands covered in blood from scratching," Choe told lawmakers. "She was a very vibrant, social young lady and now she has withdrawn."

Subcommittee Chairman Sen. Jon Ossoff, D-Georgia, released results Tuesday of the investigation into Balfour Beatty that coincided with the company's negotiations with the Justice Department on a plea deal for falsifying work orders and manipulating data in an effort to cover up complaints of maintenance issues and hazardous living conditions.

According to Ossoff, the investigation showed that the company did not prioritize the health and safety concerns of its residents or take steps to fix the problems. More troubling, he said, the subcommittee found that Balfour appeared to continue to engage in such misconduct while it was under investigation by the Justice Department and even after it pleaded guilty and was fined more than $65.4 million.

Ossoff described the investigation as "alarming and disturbing ... revealing injustice imposed on servicemembers and their families and grave risks to the health and safety of servicemembers and their families."

"[The results] reveal neglect by Balfour Beatty, which is responsible for housing tens of thousands of military families, and reveal not just neglect, but misconduct and abuse that persisted even after Balfour Beatty pled guilty to a scheme to defraud the United States between 2013 and 2019," Ossoff said at the start of the hearing.

The investigation found that families at Fort Gordon and Sheppard Air Force Base, Texas, moved into Balfour homes that hadn't been cleaned between tenants and contained mold, filth, pet hair and trash, and were exposed to mold and asbestos from crumbling ceilings, broken floor tiles and previous water damage.

The families also reported a lack of concern -- and in some cases, retaliation from housing offices -- when they requested repairs and maintenance, according to the report.

Choe, a prior enlisted soldier who said he lived in military housing as a child, when it was run by the military services, said Balfour looked at the home and insisted that there was no mold present. He said he repeatedly reached out to Balfour supervisors to make repairs and remediate mold in the home but was ignored.

"I asked if we would be given the opportunity to relocate, at least at the very minimum be provided another home to reside in while they could at least mitigate the conditions of the current home that we were at. We were categorically denied both of those choices," Choe said.

Air Force Tech. Sgt. Jack Fe Torres, who lives in a Balfour Beatty home at Sheppard Air Force Base, said mold began growing in his home when a water heater broke, flooding portions of the house. After a family member's asthma flared, they asked about mold remediation, which was approved on a limited basis by an industrial hygienist who never visited the house.

The family moved out of the house while it was repaired, only to return a month later to mold in the house. In all of the work orders for Torres's house, there is no mention of mold, the investigation noted.

"We found many issues unrepaired. There was even visible mold underneath the can opener in the kitchen. Work was completed with 'Band-Aid' fixes or ignored altogether. We immediately reported the remaining issues via the residential portal and the work orders were marked 'Wet Enter,'" Torres testified, referring to the presence of moisture or water damage in the home. "[This] was later changed to the category 'Carpentry.'"

The Department of Defense entered into agreements with private companies to build and manage installation housing largely to get out of the leasing business and to improve the services' housing stock, much of which had been allowed to languish without significant repairs or renovations.

The idea was to build new homes and neighborhoods that would attract and retain service members and their families.

Balfour Beatty officials said the company has high satisfaction rates with tenants. But Taylor testified that more than a third of the houses it manages are older homes built by the U.S. military and have long-standing maintenance issues.

Taylor said Balfour Beatty, like other construction and repair businesses, has had supply chain challenges, home access issues and staff shortages as a result of the pandemic.

He also questioned whether there was a direct link between the living conditions in the Choe family home and the daughter's skin condition.

"To my knowledge, we've never seen any photographic evidence of mold in the home," Taylor testified. "To my knowledge, the medical doctor's letter that suggested the home might be the cause of the skin conditions, or her school, to my knowledge, that doctor never visited the home personally."

The hearing is the latest chapter in a scandal that erupted in 2019 over the poor condition of privatized military housing. The issues came to light in a series of reports by Reuters on 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 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 and rolled out an expanded tenant bill of rights last August that gave residents more leverage with their landlords and to negotiate disputes.

Still, advocates on Tuesday testified that more oversight is needed and service members must be educated on how to challenge housing companies and resolve issues.

Rachel Christian, founder of Armed Forces Housing Advocates, called for harsh penalties for Balfour Beatty, which she said has exploited service members in the name of profit.

"How many more cases of negligence, fraud and civil rights violations must be presented in this building before Balfour Beatty ... is banned from receiving further government contracts as well as removed from their current partnership with the Department of Defense?" Christian asked.

The private companies that manage military housing hold contracts of up to 50 years, many of which were signed in the late 1990s.

At the end of the hearing, Ossoff pledged additional oversight to provide safe housing for military personnel and said the company would be held accountable.

Sen. Ron Johnson of Wisconsin, the subcommittee's ranking Republican, agreed.

"These men and women should expect to live in conditions that will not damage the health and safety of themselves or their families," Johnson said. "The question that kept going through my mind throughout the investigation is the statement, 'Fool me once, shame on you. Fool me twice, shame on me.' You had a settlement ... and two years later, it seems like it's still going on."

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

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