Leader Blues

Tuesday, October 02, 2007

TOP STORY >>Feds to look at housing on air base

By JOHN HOFHEIMER
Leader senior staff writer

Unhappy with the performance of at least one developer contracted to build, remodel, own and manage thousands of Air Force housing units including those at Little Rock Air Force Base, Sen. Mark Pryor (D-Ark.) has passed a resolution giving the U.S. comptroller general 180 days to find out what went wrong and suggest ways to straighten it out.

The comptroller general will look into American Eagle Communities’ housing privatization contracts at Little Rock Air Force Base and elsewhere, the extent of the problem and options open to the federal government and to subcontractors hurt by American Eagle, thanks to a resolution sponsored by Pryor and Sen. Saxby Chambliss of Georgia. Moody Air Force Base, where American Eagle has defaulted on a similar project, reportedly leaving subcontractors out of work and owed millions of dollars, is in Georgia.

American Eagle, already two years behind on its LRAFB Family Housing project, stopped work in May with only 25 new homes built out of the 468 required and the 732 additional base homes required to be remodeled by 2011.

Meanwhile, the Air Force says American Eagle and its managing partner, Carabetta Enterprises, are “actively pursuing a sale of (their) ownership interest in the project,” according to a spokesman for the Air Force Center for Engineering and the Environment, based at Brooks, Texas.

Neither American Eagle nor the Carabetta family is mentioned by name in the resolution, but according to the Air Force, they are the only privatization developers experiencing such problems.

“The housing delay adversely affects the quality of life we want for our airmen and women and their families. We must get to the bottom of the problem, fix it and make sure it never happens again,” Pryor said. “This investigation will do just that.”
“It’s critically important to our nation’s war-fighting capability for our airmen who are deployed fighting the Global War on Terror to know that their families back home are living in quality housing,” according to Brig. Gen. (Select) Wayne Schatz, 314th Airlift Wing commander.

“This project’s failure has not only adversely affected quality of life for our airmen and their families, but there are also subcontractors and others in the local community who were adversely affected by this stoppage.

“I wholeheartedly welcome Sen. Pryor’s inquiry into the housing situation here and appreciate his continued support of our Airman and the military community,” Schatz said.

“Given the current project’s financial conditions, it is unlikely that American Eagle will be able to resume work (on them),” according to an Air Force spokesman. The report will include a list of the current Defense Department housing privatization contracts behind schedule or in default, the reasons for delays and cost overruns, how the DOD solicited for bids, financing, what entities are at risk financially, and determination of what remedies are available to the government and subcontractors.
The comptroller is charged with determining the developers’ histories of previous defaults or bankruptcies and finally, with recommending opportunities for the government to ensure that all terms of the transaction are completed according to schedule and budget.