The inability of homebuilders to secure construction loans in this weak economy, combined with major force realignments from Europe and other areas, has created housing shortages for families at many large stateside military bases, the Government Accountability Office recently reported.
The housing squeeze, which affects at least 19 bases, isn't going to be relieved anytime soon and will worsen in some areas, the GAO said in a new audit report on the effectiveness of rate-setting under the Basic Allowance for Housing program.
"Adequate and affordable" housing for military families is in short supply at three quarters of bases identified as "growth" installations because they have gained, or will gain, at least 2,000 personnel under long-planned shifts in U.S. force structure.
The shortage of family housing to rent in surrounding communities exceeds 20 percent at some stateside bases. The policy of the department over the past two decades has been to rely largely on local communities to build housing for base populations. They are incentivized to do so through housing privatization and build-to-lease agreements with local bases.
But recent economic conditions "have made it difficult for developers to obtain funding for new construction projects ... particularly for multifamily rental housing projects," the GAO reported. This is particularly true around bases experiencing frequent troop deployments for wars in Iraq and Afghanistan. The constant turnover leaves many lenders uncertain about occupancy rates and income streams from proposed or new construction projects.
The GAO found significant housing "deficits" for families at four of the five bases its auditors visited for its report on Basic Allowance for Housing rates.
Fort Drum, N.Y., reports a shortage of 1,700 family housing units, and increasing numbers of soldiers are relocating there without families so they can rent smaller units or share housing with other members. More soldiers can only find affordable housing 30 to 40 miles from post.
Installation officials said housing availability will tighten even more next year when all but 1,000 of Fort Drum's soldiers are to be home from deployment for the first time since the base saw a significant pop in its population.
The shortage at Fort Bliss, Texas, is 2,900 family units, 15 percent of demand. The GAO said, "junior personnel typically obtain housing on the outskirts of El Paso and experience long commutes." The housing supply is strained by families relocating from Mexico, the GAO said, and will be strained further "as more soldiers return from deployment over the next year."
At Camp Lejeune and Marine Corps Air Station New River, both in North Carolina, the family housing shortage has reached 3,500 units, or 20 percent of demand. Marines there have closed the gap largely by buying or renting mobile homes. The Department of Defense considers mobile homes "inadequate" housing and doesn't include them in housing availability lists.
The services are using a variety of tools to address their housing challenges including housing privatization projects and closer collaboration between installations and communities, the GAO said.
But auditors criticize the Department of Defense for lacking a "formal communication process" to share information between installations on what's available and working to ease shortages.
The primary focus of the GAO audit, however, was to review the Basic Allowance for Housing program for setting local allowances for members living off base in stateside areas. The GAO concluded that the $18 billion-a-year program generally is meeting its goals, and satisfaction is high among housing allowance recipients. But auditors recommend several ways to enhance its effectiveness.
Basic Allowance for Housing rates are set using local cost surveys of rent, utilities and rental insurance for particular types of housing deemed appropriate for each pay grade, with and without dependents.
On average, more than 75 percent of the housing allowance covers actual rent and more than 20 percent covers utilities, with renter's insurance accounting for the remaining costs.
But the cost elements vary widely by locale. The GAO said that the housing allowance would be more effective if the local breakout of these costs were shared with housing officials and housing allowance recipients. Actual utility costs, for example, can range from 8 to 40 percent of Basic Allowance for Housing. Lacking information on local utility expenses, the GAO suggested, can leave renters in high-cost areas signing leases that bring unexpected out-of-pocket costs.
Officials with the Defense Travel Management Office, which sets annual Basic Allowance for Housing rates, told the GAO that publishing all three elements of the housing allowance in every housing area could be distracting for members as they might try to match each element to what's available among local rental units. But as a compromise, Department of Defense officials will publish, starting in 2012, Basic Allowance for Housing cost elements nationwide as a percentage range across various types of housing.
Defense officials also accepted the GAO recommendations to improve housing availability by sharing best housing practices between bases, and to expand the definition of "available" rental properties in military housing areas to improve the accuracy of data collection for setting local BAH rates.