[Senate Hearing 116-642]
[From the U.S. Government Publishing Office]


                                                       S. Hrg. 116-642

               THE CHAIN OF COMMAND'S ACCOUNTABILITY 
                 TO PROVIDE SAFE MILITARY HOUSING AND 
                 OTHER BUILDING INFRASTRUCTURE TO 
                 SERVICEMEMBERS AND THEIR FAMILIES

=======================================================================

                                HEARING

                               BEFORE THE

                      COMMITTEE ON ARMED SERVICES
                          UNITED STATES SENATE

                     ONE HUNDRED SIXTEENTH CONGRESS

                             FIRST SESSION

                               __________

                             MARCH 7, 2019

                               __________

         Printed for the use of the Committee on Armed Services
         
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                 Available via: http://www.govinfo.gov

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                      COMMITTEE ON ARMED SERVICES

                   JAMES M. INHOFE, Oklahoma, Chairman
                   
ROGER F. WICKER, Mississippi		JACK REED, Rhode Island
DEB FISCHER, Nebraska			JEANNE SHAHEEN, New Hampshire
TOM COTTON, Arkansas			KIRSTEN E. GILLIBRAND, New York
MIKE ROUNDS, South Dakota		RICHARD BLUMENTHAL, Connecticut
JONI ERNST, Iowa			MAZIE K. HIRONO, Hawaii
THOM TILLIS, North Carolina		TIM KAINE, Virginia
DAN SULLIVAN, Alaska			ANGUS S. KING, Jr., Maine
DAVID PERDUE, Georgia			MARTIN HEINRICH, New Mexico
KEVIN CRAMER, North Dakota		ELIZABETH WARREN, Massachusetts
MARTHA McSALLY, Arizona			GARY C. PETERS, Michigan
RICK SCOTT, Florida			JOE MANCHIN, West Virginia
MARSHA BLACKBURN, Tennessee		TAMMY DUCKWORTH, Illinois
JOSH HAWLEY, Missouri                	DOUG JONES, Alabama                                    
                                   
                                     
   		John Bonsell, Staff Director
		Elizabeth L. King, Minority Staff Director

                                  (ii)

                             C O N T E N T S

                              ________________

                             March 7, 2019

                                                                   Page

The Chain of Command's Accountability to Provide Safe Military        1
  Housing and Other Building Infrastructure to Servicemembers and 
  Their Families.


                           Members Statements

Statement of Senator James M. Inhofe.............................     1

Statement of Senator Jack Reed...................................     7

                          Witnesses Statements

Esper, Hon. Mark T., Secretary of the Army; Accompanied by            9
  General Mark A. Milley, USA, Chief of Staff of the Army.

Spencer, Hon. Richard V., Secretary of the Navy; Accompanied by      14
  Admiral John M. Richardson, USN, Chief of Naval Operations and 
  General Robert B. Neller, USMC, Commandant of the Marine Corps.

Wilson, Hon. Heather A., Secretary of the Air Force; Accompanied     17
  by General David L. Goldfein, USAF, Chief of Staff of the Air 
  Force.

Questions for the Record.........................................    67

                                 (iii)

 
THE CHAIN OF COMMAND'S ACCOUNTABILITY TO PROVIDE SAFE MILITARY HOUSING 
 AND OTHER BUILDING INFRASTRUCTURE TO SERVICEMEMBERS AND THEIR FAMILIES

                              ----------                              


                        THURSDAY, MARCH 7, 2019

                              United States Senate,
                               Committee on Armed Services,
                                                    Washington, DC.
    The Committee met, pursuant to notice, at 9:30 a.m. in room 
SH-216, Hart Senate Office Building, Senator James M. Inhofe 
(Chairman of the Committee) presiding.
    Committee Members present: Senators Inhofe, Wicker, 
Fischer, Cotton, Rounds, Ernst, Tillis, Sullivan, Cramer, 
McSally, Scott, Blackburn, Hawley, Reed, Shaheen, Gillibrand, 
Blumenthal, Hirono, Kaine, King, Heinrich, Warren, Peters, 
Manchin, and Duckworth.

          OPENING STATEMENT OF SENATOR JAMES M. INHOFE

    Chairman Inhofe. Our meeting will come to order.
    I see our witnesses are already taking their positions. I 
appreciate that very much. We always start on time. Jack and I 
have this understanding, and it has great effects.
    The Committee meets today to receive testimony from the 
service secretaries and service chiefs of our Nation's 
military.
    At the end of December, I heard from families about the 
dismal conditions they faced in privatized housing in Oklahoma 
and then around the country. I was here 20 years ago when that 
decision was made, and I remember the discussion at that time, 
``It's going to work for a while, then you wait 20 years from 
now and see what problems have erupted,'' and it happened.
    Since that time, this committee has acted quickly. We held 
a hearing, where we heard heart-wrenching testimony from family 
members, privatized-housing partners, and military leadership. 
One of those was Janet Driver, who's back there in the front 
row of the second section. I just told her how much I 
appreciated the fact that she drew this to my attention. Her 
husband's at Tinker Air Force Base, and you can always be more 
sensitive and understanding when you hear problems coming 
from--emanating from someone who has personally experienced it.
    Senator Reed and I sent our staff to a number of military 
installations, including Fort Bragg, Norfolk, Joint Base 
Anacostia, and Tinker Air Force Base. The others came from the 
services, who actually went to every one of--and I've talked to 
many of you who have been to every one of the installations in 
your command, certainly the Army. You've never seen government 
working as fast as it's worked in the last 3 weeks.
    I'd like to read you a portion of the trip summary that the 
staff wrote, which I will note was shared with each of our 
witnesses. Now, I'm quoting now, and this is for the benefit 
of, not just the witnesses here, or this table, but those in 
the back of the room, who we'll recognize in a moment. Quote, 
``From both home inspections and sensing sessions conducted 
with current on-base residents, the systemic issues outlined at 
the recent SASC [Senate Armed Services Committee] hearing are 
not only substantiated, but we believe the problems may be much 
worse. Installation commanders had different opinions of their 
housing inventory before and after we conducted our tours, 
where they thought they had a good understanding of current 
housing conditions. Most came away embarrassed that they were 
not aware of some of the dire situations. Specific issues 
included absolutely no quality assurance from the services, 
which the chain of command admits is a problem, primary 
partners and subcontractor maintenance performing shoddy 
patchwork instead of remediating the cause of the problem, and 
extreme frustration with the resident energy conservation 
program, which is supposed to curb the energy uses for on-
base''----
    Now, this is where the summary ends, but this is where the 
tough questions must begin. How did we get to this point, where 
the chain of command felt that they were not empowered, 
expected, or morally obligated to help? This is something 
different. I can remember my chain of command when I was a 
private in the United States Army. That was it. There was no 
question about it. And that has somehow changed, and perhaps 
this is going to help us in changing back something that should 
not have been changed.
    What actions have you taken since that hearing? Why didn't 
you know about this and fix it before Congress had to step in? 
Who is responsible, and who is being held accountable? Held 
accountable. Finally, what can we do now to make this right for 
our families? I have asked the chain of command from each of 
the services here today because the health, safety, and welfare 
of our servicemembers is the responsibility of everyone from 
the Secretary to the squad leaders, plain and simple. The chain 
of command failed to take care of its own, and lost their 
trust. Now the chain of command must regain that trust.
    But, the contractor must bear an equal or greater share of 
this responsibility. By no means will we bail the contractors 
out and pass along the costs to the taxpayer. That's not going 
to happen. They agreed to take care of our families, and, in 
fact, by their own admission, these contractors have not.
    In closing, we always say ``recruit the servicemember, 
retain the family.'' But, if we lose the trust of the military 
families, we risk losing the next generation of servicemembers, 
which could be a very serious problem to the safety of this 
country.
    With that, I would like to recognize any military families 
who are here today. We're going to ask you to stand up. I know 
where you're seated. Stand up if you're a family of a 
military----
    Okay, let's give them a hand.
    [Applause.]
    Chairman Inhofe. Let me summarize what our feelings are now 
with you: Help is on its way.
    To our service secretaries and chiefs, these people 
represent the thousands of military families whose trust you 
must regain.
    Before I turn to Senator Reed, I'd like to ask the members 
to stay on topic. We are here to get answers for our families, 
and our witnesses will be back in the coming weeks to answer 
questions and so forth.
    But, what we're going to do on this is something we have 
not done in quite a while, and that is, we're going to have--
instead of a 5-minute question, we're going to have 7-minute 
questions, but we're going to use the gavel. To all of you who 
might be tempted to go over that, we're not going to let you do 
that. I don't mind being unpopular in this day and maybe you'll 
forget it tomorrow.
    Senator Reed, for an opening statement.

                 STATEMENT OF SENATOR JACK REED

    Senator Reed. Well, thank you very much, Mr. Chairman.
    And I'd also----
    Chairman Inhofe. Oh, let me interrupt you first. We have--
I'm afraid might--
    [Laughter.]
    Chairman Inhofe.--I'm afraid we might lose a quorum. Since 
a quorum is now present, I'd ask the Committee to consider the 
nomination of William Bookless to be Principal Deputy 
Administrator, National Nuclear Security Administration; 
Veronica Daigle, to be Assistant Secretary of Defense for 
Readiness and Force Management; Tom McCaffery, to be Assistant 
of Defense for Health Affairs; and Lisa Schenck, to be Judge of 
the U.S. Court of Military Commission.
    Is there a motion to favorably----
    Senator Reed. So move.
    Chairman Inhofe. A second?
    Senator Rounds. Second.
    Chairman Inhofe. All in favor, say aye.
    [A chorus of ayes.]
    Chairman Inhofe. Ayes have it. It is now done.
    I apologize, Senator Reed.
    Senator Reed. Quite all right, sir.
    Let me thank you again, Mr. Chairman, and thank the service 
secretaries and the chiefs for being here today.
    ]In the 3 weeks since our last hearing on military 
privatized housing, it has become clear that there are 
systematic failures on the part of both the private housing 
companies and the Department of Defense (DOD). While the 
horrific conditions vary by installation, ranging from lead-
based paint, mold, and rodents, the underlying causes and 
fundamental breakdowns are, unfortunately, all too common 
across the country. These housing problems are exacerbated by 
the fact that military families frequently move every few 
years, and is reinforced by a culture of enduring hardships 
rather than speaking of them, for fear of retaliation, among 
other reasons.
    For far too long, privatized housing companies have been 
allowed to deliver lackluster customer service to military 
families, conduct in bare minimum for routine maintenance, and 
exercise zero quality control, while accruing sizable profits. 
Unfortunately, all this has been able to occur because of the 
lack of accountability by the Department of Defense.
    I wanted to give just one example. A Navy family had 
squirrels enter their attic through a hole in the roof. Soon 
after, the squirrels died and maggots dropped through their 
ceiling fan onto the bed. The housing company showed up to 
remove the squirrels, but failed to seal the hole in the roof 
for the last year. We know this because committee staff visited 
them 2 weeks ago. Furthermore, over the last 2-\1/2\ years, 
workers from the housing company visited this same home 52 
times for instances of water intrusion and inadequate follow-on 
work orders. Fifty-two times, without ever bothering to examine 
the root cause of the problem. On top of all this, the housing 
company still charges this family $1,780 per month in BAH 
[Basic Allowance for Housing].
    I guarantee no one in this room would ever put up with the 
substandard living conditions some of these military families 
have had to endure. I'm eager to hear what solutions the 
military service will propose today. I have several thoughts:
    First, I believe that the services have lost sight of the 
important philosophy of taking care of uniformed personnel and 
their families in all aspects of life, whether it is the 
professional readiness of the warfighter or the fact that he or 
she arrives home, on post or off post, each night to a flooded 
basement and black mold on the wall. I want to know how each of 
you intend to instill that obligation in your commanders.
    Second, military families must feel empowered with a 
standard Bill of Rights across the military services. Families 
deserve the flexibility to withhold their BAH, in the event of 
a housing problem that is not adequately resolved in a timely 
fashion. I understand some of the military services have 
already begun looking into this situation and how they can 
implement it on their own, and I'm interested, again, in your 
views.
    Third, installation commanders need to be far more active 
in their oversight role, an advocate for the homes of their 
warfighters, and no longer simply rubber-stamping center fees 
for housing contractors. Military families also deserve 
unfettered access to the maintenance records conducted in their 
homes. Privatized housing companies need to fundamentally 
overhaul the way in which they conduct customer service and 
execute work orders. Clearly, these companies are conducting 
the bare minimum when it comes to maintenance, and bandaid 
fixes are commonplace in order to cut costs and maximize 
profits. Yet, we still may hear from housing companies in the 
coming months that the answer to the problem is still more BAH, 
and I agree with the Chairman, that's not the answer.
    All of us--the services, the housing companies, and, yes, 
Congress--have let down the men and women who selflessly 
service this country. We need to do better. I look forward to 
hearing more specific solutions from our distinguished panel 
today, and to working with you as we consider this year's NDAA 
[National Defense Authorization Act].
    Thank you.
    Chairman Inhofe. Thank you, Senator Reed.
    We'll now hear from our secretaries. We're going to do this 
in order starting with you, Secretary Esper, and then coming 
across the table.
    Secretary Esper. Yes, sir. Thank you.
    Chairman Inhofe. Your entire statement, of course, will be 
made a part of the record, and we ask you to confine your 
remarks to 5 minutes.

    STATEMENT OF HON. MARK T. ESPER, SECRETARY OF THE ARMY; 
 ACCOMPANIED BY GENERAL MARK A. MILLEY, USA, CHIEF OF STAFF OF 
                            THE ARMY

    Secretary Esper. Good morning, Chairman Inhofe, Ranking 
Member Reed, and distinguished Members of the Committee. Thank 
you for the opportunity to appear before you today. Thank you, 
also, for the fact that you gave our families a voice, a few 
weeks ago, and brought this issue to everybody's attention. It 
has had a cathartic effect on us, and we look forward to 
discussing this matter with you today. But, thank you for 
bringing this issue forward.
    One of our fundamental obligations as Army leaders is to 
take care of our soldiers and their families. The recent 
reports of substandard conditions in some of our military 
housing units are deeply troubling. It is unacceptable for our 
families, who sacrifice so much for our country, to endure 
these hardships in their homes. We are fully committed to 
solving this problem, and have initiated a number of actions to 
ensure our soldiers and their families have access to safe, 
quality military housing across all of our installations.
    I would like to submit for the record a 1-page document 
that outlines the Army's Housing Action Plan. I believe each of 
you have a copy at the dais.
    Chairman Inhofe. Of course.
    Secretary Esper. We'll briefly highlight the key actions 
for the Committee.
    Chairman Inhofe. It'll be made a part of the record.
    Secretary Esper. Thank you, sir.
    [The information referred to follows:]

    Secretary Esper.
                 united states army housing action plan
    The U.S. Army is taking aggressive actions to rectify current 
housing deficiencies, and to implement longer-term solutions so our 
soldiers and their families are afforded a safe, secure, and quality 
place to live. The following is a listing of many of the initiatives 
the Army has taken or is pursuing.
Immediate Actions
      Army Senior Leaders met with all seven housing company 
CEOs or senior executives on February 19 to take immediate action to 
address housing issues.
      Installations have established 24-hour Command Hotlines 
for housing issues.
      Senior Commanders and housing company representatives 
conducted Town Halls with soldiers and families at every U.S. Army 
installation.
      Housing companies suspended non-refundable pet fees.
      The Army suspended the Army Residential Community Energy 
Conservation Program to review billing procedures.
      The Army elevated approval of housing company incentive 
fees to Army Headquarters level.
      Housing companies provided full work order visibility to 
all garrison leaders.
      Service Secretaries developed a draft ``Tenant Bill of 
Rights'' for residents.
      The chain of command is conducting Barracks inspections 
and Family housing visits for all Army-owned and privatized facilities 
by March 18, 2019.
      Department of the Army Inspector General is inspecting 
all 49 installations with privatized housing and will complete their 
report by mid-May.
Longer Term Actions
      The Army will begin conducting a Quarterly Board of 
Directors meeting with housing senior executives beginning in April.
      The Army is working with housing companies to develop an 
online work order tracking system for residents.
      The Army is developing its own online reporting system 
for tenants to rate work order timeliness, quality of work, and 
customer service for each service visit.
      The Army is developing new metrics to assess RCI company 
performance and customer satisfaction; this will serve as the basis for 
a new incentive fee structure.
      The Army is renegotiating all housing company incentive 
fee structures to align with Army customer service objectives and the 
Tenant Bill of Rights
      The Army is developing a new training curriculum on 
housing oversight for garrison command teams.
      The Army is reviewing quality control procedures to 
ensure adequate resourcing and staffing is available for effective 
oversight of housing company performance.
      The Army is reviewing options to empower residents to 
withhold rent payments to hold the housing companies financially 
accountable for poor performance.

    Secretary Esper. The Army currently has 111,000 housing 
units, of which 87,000 were privatized under the RCI 
[Residential Communities Initiative] program. These homes are 
managed by seven private companies across 49 installations. The 
transition to privatized housing in 1998 marked a dramatic 
improvement in living conditions for our soldiers and their 
families. However, this model assumed that the RCI contractors, 
with sufficient Army oversight, would continue to maintain the 
quality of these homes. In too many cases, it is clear the 
private housing companies failed to uphold their end of the 
bargain, a failure that was enabled by the Army's insufficient 
oversight. We are determined to investigate these problems and 
to hold our housing contractors and chains of command 
accountable.
    The Army is taking immediate action to fully understand the 
scope and scale of our military housing problems and to remedy 
the current housing deficiencies. Within 18 hours of the first 
hearing on this topic, I traveled with General Milley and 
Sergeant Major of the Army Dailey to Fort Meade, where we 
personally walked through multiple homes and spoke to our 
affected families. We also met with the leadership of the 
privatized housing company, and pressed them to take immediate 
actions.
    Since then, Army senior leaders have traveled to Fort 
Bragg, Fort Belvoir, Fort Campbell, and West Point to conduct 
our own housing visits and to meet with families and garrison 
leadership. Over the past 3 weeks, Army installations have 
conducted townhall meetings, in collaboration with the RCI 
contractors, in addition to establishing housing hotlines. This 
has provided families a forum to voice their concerns and to 
report problems directly to garrison commanders.
    We also ordered all senior commanders to complete a 100-
percent screening of their installation housing by March 18. 
Where life, health, and safety issues exist, senior commanders 
have been instructed to immediately relocate housing residents 
to temporary quarters until the housing conditions are 
remediated. This screening process is ongoing, and, to date, we 
have completed over 19,000 housing visits.
    We have also met with the CEOs [chief executive officer] or 
senior executives from each of the seven privatized housing 
companies to discuss the current problems. The poor customer 
service, the lack of work-order transparency, and the inability 
of residents to hold the housing companies accountable for 
deficient conditions were common themes presented during our 
town halls. All of our housing contractors have committed to 
working together to find ways to improve customer service and 
to increase transparency. Additionally, they all agree to 
ensure sufficient numbers of trained technicians and staff are 
available at each installation to address problems in a timely 
manner.
    To inform our long-term solutions to this problem, we have 
initiated IG [inspector general] inspections across the 49 
installations with RCI housing. These inspections are focused 
on customer satisfaction, work-order responsiveness, and the 
ability of our garrison commands to provide proper oversight of 
our private contractors. Many residents have told us that 
communication between residents and the private housing 
companies is broken. To enable greater transparency in the 
future, we are developing tracking systems to provide a common 
picture to residents, garrison leadership, and housing 
contractors. We are also restructuring incentive management 
plans to more closely align with those areas that are most 
important to our residents, such as work-order resolution and 
customer satisfaction. It is not acceptable for us to provide 
high rates of incentive payment when the quality of service 
provided to our residents is substandard.
    Furthermore, to ensure our soldiers and their families have 
proper legal protections, we are working in conjunction with 
the other services to develop a Tenant Bill of Rights. I 
believe the Committee received this yesterday, and if I may, on 
behalf of my colleagues and myself, submit this as a record, as 
well----
    Chairman Inhofe. Without objection.
    Secretary Esper.--our draft Tenant Bill of Rights.

    [Tenant Bill of Rights has been retained in Committee 
files.]

    Secretary Esper. Many Army families are concerned they lack 
the ability to hold the private housing companies accountable 
for poorly performed services, and are inadequately protected 
from retaliation. This Tenant Bill of Rights will outline the 
residents' basic rights while living in military privatized 
housing, including options that address the problems they are 
facing most frequently. To better empower chains of command, we 
will implement training for garrison command teams on 
contracting and housing management. Additionally, we will 
increase garrison staffs to perform quality assurance and 
quality control checks on work-order completion and housing 
transitions. Furthermore, we will develop our own reporting 
system for residents to rate timeliness, quality of work, and 
level of customer service, to provide additional data to 
garrison oversight teams.
    Providing a safe, quality living environment for our 
soldiers and their families is critical to the readiness of the 
force. This is essential to building trust, so, when soldiers 
deploy, they can rest assured their families are taken care of 
back home. To do this, the Army needs to get back involved in 
the housing business.
    [The joint prepared statement of The Honorable Mark T. 
Esper and General Mark A. Milley follows:]

  Joint Prepared Statement by The Honorable Mark T. Esper and General 
                             Mark A. Milley
                              introduction
    Chairman Inhofe, Ranking Member Reed, and distinguished members of 
the Committee. Thank you for this opportunity to testify on the chain 
of command's accountability to provide safe military housing and other 
building infrastructure to servicemembers and their families.
    One of our fundamental obligations as Army leaders is to take care 
of our soldiers and their families. The recent reports of sub-standard 
conditions in some of our military housing units is deeply troubling. 
It is unacceptable for our families who sacrifice so much for our 
country to endure these hardships in their own homes. We are fully 
committed to solving this problem, and have initiated number of actions 
to ensure our soldiers and their families have access to safe and 
secure military housing across all of our installations.
    The Army currently has 111,000 family homes, of which 87,000 were 
privatized under the Residential Communities Initiative (RCI) program. 
These privatized homes are managed by seven private companies across 49 
installations. The transition to privatized housing in 1998 marked a 
dramatic improvement in living conditions for our soldiers and their 
families. However, this model assumed that the RCI contractors, with 
sufficient Army oversight, would continue to maintain the quality of 
these homes. In too many cases, it is clear the private housing 
companies failed to uphold their end of the bargain, and the Army 
failed to adequately provide oversight. We are determined to 
investigate these problems and to hold our housing contractors and our 
military and civilian chains of command accountable. The Army is moving 
out to immediately rectify the current deficiencies and to implement 
longer-term solutions so that our servicemembers' families are afforded 
a safe, secure, and quality living environment.
                           immediate actions
    The Army is taking immediate action to fully understand the scope 
and scale of our military housing problems and to remedy the current 
housing deficiencies. Army senior leadership has traveled to Fort 
Meade, Fort Bragg, Fort Belvoir, Fort Campbell, and West Point to 
personally walk through housing, meet with families, and press the 
housing CEOs on taking immediate actions. Additionally, every 
installation has conducted town hall meetings in collaboration with the 
RCI project company representatives and established housing hotlines. 
This has provided families a forum to voice their housing concerns and 
to report problems directly to garrison commanders. Throughout these 
meetings, we gained valuable insights from our residents that will 
inform our long-term solutions. Additionally, we ordered all senior 
commanders to complete a 100 percent life, safety, and health screening 
of their installation housing by March 18th, as well as any maintenance 
deficiencies. Where life, health, and safety issues exist, senior 
commanders have been instructed to immediately relocate housing 
residents to temporary quarters until the hazardous conditions are 
remediated. This screening process is ongoing and will be followed by a 
detailed report by each senior commander, providing their assessment of 
the quality of housing on their installation.
    We have also met with the CEOs or senior executives from each of 
the seven privatized housing partners that manage housing on Army 
installations to discuss the current problems. The poor customer 
service, the lack of work order transparency, and the inability of 
residents to hold the housing companies accountable for deficient 
conditions were common themes presented during our installation town 
halls. All of our partners have committed to working together to find 
ways to improve customer service, increase transparency, and to 
renegotiate incentive management plans. Additionally, they all agreed 
to ensure sufficient numbers of trained technicians and staff are 
available at each installation to address problems in a timely manner.
                          long-term solutions
    In addition to taking swift action to rectify all current housing 
deficiencies, we are conducting Inspector General inspections to 
determine the root of the problems across the 49 installations with RCI 
housing. These inspections are focused on customer satisfaction, work 
order responsiveness, and the ability of our garrison commands to 
provide proper oversight of our private contractors. Throughout this 
process, we will work with families, garrisons, and our housing offices 
to develop more effective tracking, reporting, and enforcement 
mechanisms to ensure we are meeting our obligation to provide safe, 
high-quality family housing.
    Part of our long-term solution includes developing systems to 
ensure greater transparency and responsiveness to resident needs, while 
enabling more effective oversight of our privatized housing. Resident 
visibility on maintenance requests varies across installations and 
generally does not provide tenants with a clear status of work orders. 
To enable greater transparency, we are developing tracking systems to 
provide a common picture to residents, Army RCI Asset Managers, and 
housing contractors.
    We will also be restructuring contracts and incentive management 
plans to more closely align with those areas that are most important to 
our residents such as work order resolution and customer satisfaction. 
It is not acceptable for us to provide high rates of incentive payment 
when the quality of service provided to our residents is substandard. 
Designing these incentive payments with more accurate information will 
allow us to better focus the private housing companies on quality of 
life issues that affect our communities.
    Furthermore, to ensure our soldiers and their families have proper 
legal protections, we are working in conjunction with the other 
Services to develop a Tenant Bill of Rights coupled with appropriate 
enforcement and arbitration mechanisms. Many Army families are 
concerned they lack the ability to hold the private housing companies 
accountable for poorly performed services and are inadequately 
protected from retaliation. This Tenant Bill of Rights will outline the 
residents' basic rights while living in Army privatized housing. We are 
also developing options for financial recourse if they are not provided 
quality housing.
    As we move forward to meet the fundamental obligation of providing 
our families with quality housing, the Army will focus on those longer-
term actions that will prevent this from happening again. We will 
require training specific for garrison command teams on contracting and 
housing management, which will empower them to better respond to tenant 
grievances. We will also add staff to perform quality assurance and 
quality control checks on work order completion. Furthermore, we will 
develop our own reporting system for residents to rate timeliness, 
quality of work, and level of customer service to provide additional 
data to garrison oversight teams. Finally, we will hold the chain of 
command responsible for visiting housing and barracks on a routine 
basis as part of their health and welfare programs.
                               conclusion
    Providing a safe and secure living environment for our soldiers and 
their families is an enduring obligation of ours as Army leaders and is 
critical to the readiness of our force. It is clear that we have failed 
to conduct the necessary oversight to hold our private partners 
accountable for the sub-standard housing conditions across our 
installations. The Army is moving out rapidly to understand the extent 
of this housing problem and to rectify the deficiencies that exist. 
Moving forward, we are committed to applying the necessary resources to 
enable the oversight required to fully address these issues.
    We will continue to work closely with our residents, garrison 
commands, and our seven private housing companies to ensure we provide 
our soldiers and families the quality of housing they deserve. The Army 
needs to get back involved in the housing business. This includes 
taking a more active oversight role of not only privatized housing, but 
also the barracks where many of our junior soldiers live. This is 
essential to maintaining our readiness, so when soldiers deploy, they 
can rest assured their families are taken care of back home. Thank you 
for your interest in this matter, as well as your continued support to 
the Army.

    Chairman Inhofe. Good statement.
    Secretary Spencer.

 STATEMENT OF HON. RICHARD V. SPENCER, SECRETARY OF THE NAVY; 
ACCOMPANIED BY ADMIRAL JOHN M. RICHARDSON, USN, CHIEF OF NAVAL 
                           OPERATIONS

    Secretary Spencer. Chairman Inhofe, Ranking Member Reed, 
distinguished guests, I wish I could say I'm pleased to be here 
today, but I am not.
    I want to start by first apologizing personally on behalf 
of the Department of the Navy to any sailor, marine, soldier, 
airman, coastguardman that was affected by the housing malady 
that we've seen before us right now. The people of the Navy/
Marine Corps team will always be our greatest resource and our 
greatest asset, and the safety and well-being of sailors and 
marines and their families is a top priority for all of us.
    After the initial assessment, I can state with certainty 
that we can, and we will, correct the issue--the issue at hand, 
which is not acceptable. We will make the process and the 
product better in the long run. The solution is based on the 
simple precepts of communication, education, and attention. 
When I say ``simple,'' that's just the basic concepts. The 
details will be forthcoming.
    I also want you to know that the three service secretaries 
are working in lockstep. Much that you will hear today, we are 
doing in coordination. You'll hear of a common lease, the 
development of that. We are working hand-in-hand in that 
regard.
    On top of the considerable demands of service, no military 
family should ever have to contend with chronic maintenance 
issues or concerns such as mold, pests, and intrusions into 
their house. In order to fulfill our obligation to our families 
and ensure the strength and readiness of our force, we must 
demand excellence and responsiveness for all concerned, 
including our housing partners. It is clear, in many cases, we 
have fallen woefully short of this obligation, and, upon 
reviewing the issues surrounding housing, it's apparent there 
is culpability around the table. We're taking steps to address 
the immediate problems, as well as address our business and 
education processes, to permanently correct systemic issues.
    Upon the assessment, the CNO and the Commandant of the 
Marine Corps issued a NAVADMIN and white letters stating that, 
by April 15 of this year, every Marine and Navy family in 
Private Public Venture (PPV) housing will be offered a personal 
visit from base officials. We're getting the uniformed command 
back into the equation. These command teams will not be 
satisfied until the housing issues they discussed or observed 
are resolved.
    Following that, a regular drumbeat of follow-on chain 
command attention will follow. We've been in discussion with 
our private partner--Private Public Venture partners about the 
availability of apps that are available now--and they are 
attacking this issue--that allows for reporting, tracking, 
rating resolution, and enhancing the communication that is 
needed between our servicepeople and the Private Public Venture 
partner.
    The three service secretaries will be holding quarterly 
meetings with the CEOs of our venture partners to address and 
monitor, on a continual basis, the satisfactory delivery of 
housing for our military families. Our housing partners will 
remain an important component of the housing solution offered 
to military families. However, our military leaders must never 
outsource their role as advocates for our servicemembers and 
their family. The Navy-Marine Corps team will continue to 
pursue improvements in military housing with a sense of urgency 
to deliver the services our military families deserve, the 
value the American taxpayers expect, and the readiness our 
global force requires.
    Going forward, we look forward to working with this 
Committee to do everything in our power to protect the health, 
well-being, and safety of our sailors, marines, and military 
families, wherever they call home.
    Thank you.
    [The joint prepared statement of The Honorable Richard V. 
Spencer, Admiral John M. Richardson, and General Robert B. 
Neller follows:]

 Joint Prepared Statement by The Honorable Richard V. Spencer, Admiral 
            John M. Richardson, and General Robert B. Neller
    Chairman Inhofe, Ranking Member Reed, distinguished Members of the 
Committee, thank you for the opportunity to testify on this critical 
issue. The people of the Navy Marine Corps Team will always be our 
greatest resource, and the safety and well-being of our sailors and 
marines and their families is a top priority for each of us. Trust and 
confidence are the bedrock upon which effective command rests, and the 
sailors and marines in our care must be confident that when they bring 
a problem to their chain of command, their leadership will advocate 
tirelessly on their behalf.
    On top of the considerable demands of service, no military family 
should ever have to contend with chronic maintenance issues or concerns 
such as mold, pests and intrusion in their home. In order to fulfill 
our obligations to our military families and ensure the strength and 
readiness of our force, we must demand excellence and responsiveness 
from all concerned, including the Public-Private Venture (PPV) partners 
who provide 39,384 housing units to the Navy and 23,329 to the Marine 
Corps.
    It is clear that in some cases we have fallen short of this 
obligation, and we are determined to take corrective action with a 
sense of urgency. In response to the concerns that have come to light 
regarding the PPV Housing program, the Navy and Marine Corps are 
comprehensively reviewing the business systems, reporting mechanisms 
and oversight procedures governing the way housing maintenance issues 
are reported, remediated and verified in privatized housing.
    These ongoing reviews have revealed several systemic issues. For 
example, the burden for reporting and escalating a housing issue too 
often falls on the servicemember, sometimes requiring multiple calls to 
achieve a satisfactory response. Once the need for corrective action 
has been established, our private partners have too often failed to 
live up to their obligations to conduct satisfactory repairs in a 
timely manner. And the Department of the Navy has too often failed to 
effectively exert the oversight needed to identify and correct isolated 
issues before they become systemic. There is culpability around the 
table.
    In response to these concerns, we are taking steps to address 
immediate problems as well as adjust our business processes to 
permanently correct systemic issues. General Neller and Admiral 
Richardson have each issued orders requiring commanding officers to 
afford the opportunity for every family in military housing to receive 
a voluntary visit by 15 April 2019. The purposes of these visits are: 
(1) to raise command awareness of family living conditions to ensure 
that they are safe, secure and environmentally healthy; (2) to 
personally observe any issues affecting the home and to understand any 
actions being taken to address them; and (3) if a problem is found, to 
help servicemembers and their families get the problem resolved, and 
ensure that all families understand the help and resources available to 
them.
    Marine Corps Commanders will use the Marine Housing Outreach 
program to improve their awareness of concerns and better advocate for 
military families. Commanders will leverage appointed servicemember 
advocates and the base housing office to streamline communication with 
providers. Both Commanders and appointed advocates will ensure 
effective oversight and remediations are in place, operating with the 
full authority and support of the chain of command.
    The Navy will streamline its reporting process so that no sailor 
has to exceed two calls before achieving resolution--the first to the 
housing company, and the next to their chain of command, which can then 
properly advocate on their behalf with the government base housing 
office, base leadership, and Commander Naval Installation Command 
(CNIC) to ensure resolution. Simultaneously, families will continue to 
have an open channel to the base housing office.
    Additional systemic improvements include:

      Privatized Housing Crisis Action Teams at the 
Installations Command headquarters, as well as each Regional Command to 
respond with alacrity to housing complaints.
      Comprehensive reviews of all reporting mechanisms and 
oversight procedures that govern the way privatized military housing 
discrepancies are reported, remediated, and verified through our 
Public-Private Venture partners. We have been in discussion with PPV 
partners about available apps to address reporting, tracking, rating 
and resolution.
      Weekly assessments conducted by Regional Housing 
Directors to provide comprehensive oversight and quality control on 
work orders, including database systems to track work orders and spot 
checks of individual work orders to ensure quality repairs.
      Outreach letters to all families in PPV housing as well 
as social media communication.
      Open forums sponsored by installations and delivered by 
the local base commanders.
      Out of cycle independent Resident Satisfaction Surveys 
with specific questions added to ensure resident concerns have been 
captured fully.
      Quarterly meetings with PPV CEOs and Service Secretaries 
to address and monitor the satisfactory delivery of housing for our 
sailors and marines.

    These are just a few examples of the actions being taken by the 
Navy Marine Corps Team. We will continue to improve oversight 
procedures. We will evaluate and modify as needed the business 
agreements with our Privatized Housing Partners to incentivize 
responsiveness, quality control, field management oversight and 
customer service to ensure that resident safety and satisfaction is 
paramount. We will also leverage mobile technology, upgrade our 
database systems, and improve chain-of-command advocacy.
    Our PPV partners will remain an important component of the housing 
solutions offered to military families, however our military leaders 
must never outsource their role as advocates for our servicemembers and 
their families. It is an essential function of commanders and small-
unit leaders to effectively advocate for the sailors and marines they 
serve.
    We must empower these leaders to navigate the constellation of 
relationships that govern PPV Housing, and provide the authority and 
opportunity to take corrective action before it impacts the safety and 
wellbeing of our military families, and the readiness and effectiveness 
of our force.
    We're ensuring base officials are aware of the leverage options 
available to hold PPV partners accountable, including the adjustment of 
incentive fees, the authority to issue cure notices, and ultimately, 
the ability to replace the property management company if necessary. We 
are educating leaders on how they can forcefully and effectively assist 
when established processes are not providing our servicemembers and 
their families with satisfactory results in PPV housing.
    We have also made clear the expectation that command teams shall 
not be satisfied until housing issues are resolved, and have 
invigorated the relationship between deployed servicemembers and the 
installations enterprise. Finally, we are expanding the scope of 
engagement between commands and servicemembers regarding off-base 
housing.
    The Navy Marines Corps Team will continue to pursue improvements in 
military housing with a sense of urgency to deliver the services our 
military families deserve, the value the American taxpayers expect, and 
the readiness our global force requires. We will continue pursuing 
solutions to correct the issues that have been identified and provide 
lasting systemic improvements to prevent their recurrence. We look 
forward to working with this committee to do everything in our power to 
protect the health, well-being and safety of our sailors, marines and 
military families wherever they call home.

    Chairman Inhofe. Secretary Wilson.

   STATEMENT OF HON. HEATHER A. WILSON, SECRETARY OF THE AIR 
FORCE; ACCOMPANIED BY GENERAL DAVID L. GOLDFEIN, USAF, CHIEF OF 
                     STAFF OF THE AIR FORCE

    Secretary Wilson. Thank you, Mr. Chairman.
    Our military families deserve good housing, and when 
there's a problem with a house, it should be fixed promptly and 
competently. Moreover, our airmen should be comfortable that 
they can identify problems without any fear of retaliation.
    Over the past 3 weeks, the Chief and I directed the chain 
of command to do a 100-percent health-and-safety review of all 
Air Force family housing. We have the initial results of that 
review, and I would ask that this be put into the record.
    Chairman Inhofe. Without objection.

    [Air Force Health and Safety Review have been retained in 
Committee files.]

    Secretary Wilson. The real question is, where do we go from 
here? In the immediate term, we have to take action on all of 
the health and safety issues that were identified, and make 
sure they are addressed competently and promptly, and fixed. 
The Chief and I also will be clarifying and communicating to 
our commanders our expectation of them and of our Civil 
Engineering Center so that we know, and they know, what we 
expect from them, going forward, in taking care of our airmen.
    In the medium term, we have to fix the system. There are 
several elements of that, based on our initial view. The first 
is an enforceable Tenant Bill of Rights, and my colleague has 
already put that into the record. It's something that the three 
service secretaries are united on, but it is a draft. We're 
looking, also, for input from all of you.
    Second, we believe we need to strengthen the base commander 
input, oversight, and eyes-on when it comes to family housing. 
That means giving base commanders more input on performance 
fees, more support when it comes to quality control in their 
own housing offices, as well as support from the Civil 
Engineering Center, and more support from contracting 
representatives who have the ultimate control over those 
contracts.
    Third, we need to improve communications and feedback loops 
to restore trust with airmen. They need to--we--they need to be 
engaged, not just on that first day, when it's so chaotic 
moving in, but thereafter, so they know what to expect and how 
to get help when they need it. There are multiple avenues for 
them to get action and report problems, and we are going to 
make sure all of those avenues are open.
    Fourth, the Chief and I have also directed an inspector 
general review, which is ongoing, to look at the system, to 
identify additional actions that need to be changed to fix the 
problem.
    Thank you, Chairman, and I look forward to your questions.
    [The joint prepared statement of Dr. Heather Wilson and 
General David Goldfein follows:]

  Joint Prepared Statement by Secretary of the Air Force Dr. Heather 
            Wilson and Chief of Staff General David Goldfein
                              introduction
    The United States Air Force is committed to the health and safety 
of our airmen and their families. Our people are our most important 
resource. Airmen are executing warfighting missions for our nation 
around the world, twenty-four hours a day. Our ability to conduct these 
operations is affected by the well-being of our airmen, their families, 
and the communities that host our installations. We project combat 
power from these installations, which also serve to house and protect 
our airmen and their families. Inadequate housing reduces the quality 
of life for our airmen. Morale declines, retention suffers, and the Air 
Force pays a price in readiness. Since we began privatizing Air Force 
housing twenty-two years ago, we have proactively sought feedback from 
airmen and implemented better ways to manage the system. Where there 
are challenges, Air Force leadership owns it. Access to high-quality, 
safe, and healthy housing is the right thing to do for our airmen and 
for the readiness of our force.
               protect airmen and their families' health
    In 1996, Congress passed the Military Housing Privatization 
Initiative, giving the Services the authority to enter into agreements 
with the private sector to improve housing and quality of life for 
servicemembers and their families. Since then, across the United 
States, the Air Force has privatized more than 55,000 homes. 
Installation housing occupancy is at about 96 percent. Airmen generally 
give high marks for their accommodations. A 2018 third-party survey 
found that nearly 82 percent of respondents reported their homes to be 
``Very Good.''
    While the overall ratings may be good, some privatized housing 
project owners have not met expectations. We have retained Performance 
Incentive Fees for poor performance, and implemented corrective action 
plans to fix systemic problems where we have identified them. However, 
these actions have not been sufficient, in some cases, to fix the 
problem.
    Our airmen have a right to openly report housing problems without 
fear of reprisal. We are committed to improving trust and transparency 
between our airmen, the housing management teams, and base leadership 
to resolve issues quickly and fairly, and to help our airmen thrive.
                   how the air force manages housing
    The Air Force has a comprehensive portfolio management process. At 
the base level, each installation has a local housing office that does 
the daily work of engaging with airmen and their families, visiting 
their homes, working with project owners' staffs, and ensuring 
paperwork is correct. Capacity at the unit level is likely adequate 
when the privatized housing owner is performing well. It is likely 
insufficient when a privatized housing owner is not performing well. 
This is an area where the Air Force has a lack of capacity to support 
base commanders when things are off track.
    At the next level up, the agreements for privatized housing project 
owners are centrally managed by the Air Force Civil Engineer Center 
(AFCEC). This Center is focused on broader community concerns and works 
directly with our installations and privatized project owners. In some 
instances, the Civil Engineer Center has not been able to provide 
sufficient support and analysis when things are off track at the base 
level.
    Airmen are encouraged to address housing issues with their local 
housing office first. If the housing office can't resolve the issue, 
they are either directed through the airman's chain of command or, in 
some cases, directly to the Civil Engineer Center. At that level, the 
Civil Engineer Center interacts daily with the Deputy Assistant 
Secretary for the Air Force for Installations and can elevate an 
airman's housing concern for consideration with Air Force leadership.
    Each quarter, the Air Force Civil Engineer Center conducts project 
reviews with installation leaders, project owners, and local housing 
offices. Corrective action plans can be established, if needed. Each 
year, the Air Force Civil Engineer Center visits every Air Force 
installation to inspect homes and ensure project owners are complying 
with requirements. Our review is showing that this is insufficient when 
there are serious problems in privatized housing.
    The Air Force Civil Engineer Center and the Deputy Assistant 
Secretary for the Air Force for Installations, Environment, and Energy 
conduct Program Management Reviews on a regular basis to evaluate 
housing activities across the Air Force. Twice each year, they meet 
with the project owners to share best practices, discuss lessons 
learned, and conduct one-to-one feedback sessions. Again, this is 
insufficient where we have an underperforming location.
                           leadership review
    The health and safety of our airmen and their families is a 
leadership imperative. Over the past two weeks, the Air Force 
implemented a 100 percent review of our military housing. Wing 
Commanders with responsibility for military and privatized housing on 
their installations led the reviews with their subordinate unit 
commanders and senior enlisted leaders. The Assistant Secretary of the 
Air Force for Installations, Environment, and Energy created a standard 
checklist and sent it to each installation housing office. Commanders 
used the checklist to document any health or safety risks they found. 
The Assistant Secretary also established an action team to support our 
Wing Commanders, provide guidance, advice, and assistance, and gather 
the collected data for this review.
Wing Commander Review Findings
    The review included responses from 50,991 military personnel out of 
57,500 (89 percent) military personnel living in government-owned, 
government-controlled, and privatized housing. There were 44,097 
responses for privatized housing and 6,894 responses for government-
owned and government-controlled housing. Eleven percent could not be 
reached during the limited time of the review due to personal and work 
travel, or being assigned under a Joint commander.
    At Joint bases, Air Force, Army, and Navy commanders worked to 
avoid redundant reviews and to ensure other service commanders were 
aware of identified issues with their members. Commanders report that 
14.1 percent of members expressed a life, health, or safety concern in 
their homes. The percentage was much lower in government owned and 
leased homes, where only 1.5 percent expressed concerns vice 15.4 
percent for privatized housing. Common issues include mold and 
moisture, insects, or mice. Some residents also expressed concerns 
about other areas for further investigation, like peeling paint that 
could potentially contain lead, or the potential presence of radon or 
asbestos.
    Of the 50,991 housing members who responded to our review, 9,861 
members requested visits. Leadership visited those homes and found:

      25 percent had mold and moisture issues,
      5 percent had chipped or flaking paint,
      13 percent had droppings, or other evidence of vermin, 
and
      71 percent presented other maintenance concerns.

    Commanders continue to make contact with the airmen that have not 
yet been reached and to conduct all of the visits requested by our 
members. For identified issues, commanders are overseeing and tracking 
work orders created by the project owner for the housing maintenance 
crews through actual completion. Each commander is also working with 
Army and Navy commanders to ensure issues are addressed for 
servicemember without duplication of effort.
    This is a start. We will follow through to address the systemic 
issues at each of our installations.
Air Force Leadership Visits
    We personally conducted visits to our most troubled installations 
to see the issues and talk to the airmen, the installation leaders, 
and, in some cases, the project owners. They participated in listening 
sessions comprised of airmen and their families to get a better 
understanding of what was working and what still needed to be done.
    The results of the Wing Commander's reviews and Air Force 
leadership visits reviews highlighted five things:
      An inability to do adequate quality assurance on 
maintenance crews
      Housing Management Offices are too small and lack 
authority
      Airmen do not fully understand their rights and 
responsibilities
      Project owner performance incentive fees are not driving 
desired outcomes
      Persistent mold issues caused by poor construction 
quality
    The quality of local project-owner leadership and management of 
privatized housing matters. At one base, where local leadership was 
weak, there were widespread complaints of unqualified staff, poor or no 
repairs, poor communication, lack of responsiveness, and deep 
frustration. A base in the same climate, under the same project owner 
company, with good local management was complimentary to staff who were 
competent and responsive and ``went the extra mile'' to take care of 
airmen.
    Unlike normal renting relationships on the commercial market, 
military renters have less leverage to get a response when service is 
poor. This is why we want to create a Tenants Bill of Rights with local 
third-party arbitration built in to assure proactive and competent 
responses by the project owner maintenance teams for deficiencies.
                   specific construction deficiencies
F.E. Warren Air Force Base
    Some of the 13,426 homes conveyed privatized housing projects were 
built before 1978 and may still contain lead paint or materials. Each 
installation has a program to track and manage lead-based paints. We 
randomly visit homes every year to ensure project owners are complying 
with all documentation and statutory requirements. To date, we have 
only found some documentation issues. Where we have found elevated 
levels of lead in homes, like at F.E. Warren Air Force Base, the 
project owners have responded quickly and worked with our airmen to 
ensure their safety, and the safety of their families, within their 
homes.
Keesler Air Force Base
    In 2010, 1,028 homes were built for Keesler Air Force Base. Poor 
quality workmanship during construction of the air conditioning systems 
and building envelope caused condensation and recurring problems with 
mold. The project was bought in 2015 on the condition that original 
work defects be fixed. The new Moisture Remediation Plan has three 
phases. The Test Pilot Phase and Immediate Response Phase have both 
been completed. The Sustainment Phase is comprised of three stages of 
work. During Stage 1, all 1,028 homes had some work done to them. Stage 
2 is 33 percent complete and involves 255 homes. The third and final 
stage will look for any residual moisture issues that need to be fixed. 
The Sustainment Phase is due to finish in June 2020. In the meantime, 
the Air Force Civil Engineer Center is monitoring compliance.
MacDill Air Force Base
    The Air Force conveyed 241 homes at MacDill Air Force Base to a 
project owner. The homes had systemic moisture problems due to breaches 
in or lack of a vapor barrier. In 2017, the project owner reclad 94 
homes. Last year, they repaired stucco siding and interstitial spaces 
under floors. They also added dehumidifiers to homes with inadequate 
air conditioning and treated homes for mold. This year, they have 68 
homes scheduled for recladding.
Tinker Air Force Base
    Many homes at Tinker Air Force Base were built using cross-linked 
polyethylene plumbing lines. These lines had a manufacturing defect 
that caused pinhole leaks, and 398 homes showed signs of mold growth 
inside the walls. Last May, the Air Force moved all affected families 
into furnished homes while the faulty water lines were replaced. In 
June of last year, mold growth was discovered in the mechanical rooms 
of 200 newly-constructed homes. A third-party engineering service was 
hired to assess the room design and identify the root cause the of 
moisture problems. Both projects are due to complete by May 2019.
Tyndall Air Force Base Rebuild
    On October 10, 2018, the strongest hurricane ever recorded on the 
Florida panhandle made landfall near Tyndall Air Force Base. All 876 
privatized homes were damaged in the storm ranging from roof and siding 
to complete losses. Tyndall's enduring missions didn't stop, and the 
Air Force has been working to secure housing for the airmen in those 
units. Tyndall is also one of four bases in the Air Education Training 
Command Group 1 Housing Privatization Project that also includes 
Sheppard, Altus, and Luke Air Force Bases. The damage at Tyndall was so 
severe, the entire project requires financial restructuring. The Office 
of the Secretary of Defense and Office of Management and Budget would 
have to approve this course of action, so we are working with each 
office, along with the project owner and its private lender to provide 
long-term housing for our airmen at these four bases.
                               way ahead
Immediate actions
    For identified healthy and safety issues, we are taking immediate 
action to ensure they are addressed. In response to Air Force 
leadership observations, we will ensure qualified expertise is in place 
to address quality assurance requirements.
    To improve communication with residents the Air Force, the Army, 
and the Navy have developed a draft Tenant Bill of Rights to improve 
tenant-landlord communications, collaboration, and expectation 
management. It would also provide airmen financial leverage during 
housing disputes.
    It is a draft. We want to engage with you to finalize this effort. 
A Tenant Bill of Rights would allow airmen to withhold rent or break 
leases if project owners weren't fixing significant problems.
    Within the next two weeks, the Air Force is completing an Air Force 
Inspector General review and assessment of policies and procedures for 
handling resident health and safety challenges. We're taking all 
allegations or indication of fraud very seriously. Our AF Office of 
Special Investigations (AFOSI) will carefully assess, and as warranted, 
pursue such concerns.
    To improve the housing management offices, we have already begun 
increasing the capability and capacity of the workforce through a 
broader Infrastructure Investment Strategy. This strategy is focused on 
developing and retaining civil engineering expertise, while adding 
enough trained staff to manage our housing management offices 
effectively. We have also established a nationwide call center in order 
to provide residents with an alternate channel to elevate their housing 
concerns.
    Of the four installations where mold is an endemic issue, we have 
had corrective action plans in place for about two years. All projects 
are scheduled for completion over the next six to eighteen months.
Next steps toward enduring improvement
    The Air Force will increase oversight by Wing leadership and the 
chain of command. Nothing can substitute for a commander on site with 
the appropriate level of authority. We will also ensure that the 
medical leadership and installation leadership are sharing information 
properly.
    We will likely need to renegotiate agreements with privatized 
project owners to implement the Tenant Bill of Rights. We will need to 
revise the incentive fee structure to provide more leverage to the 
services to address systemic lack of performance. In particular, we 
want to give the base commander significant input on the award of 
incentive fees and move away from formulas that can always be 
``gamed''. Doing so, we believe, will make the privatized housing owner 
more responsive to the local commanders who have ``eyes on''. In some 
cases we will retain incentive fees for poor performance and establish 
corrective action plans to fix systemic technical and leadership 
challenges.
    We will continue to strengthen housing management offices and 
structure support from the Air Force Civil Engineer Center so that 
troubled projects get sufficient focus and attention. While we will 
continue our quarterly reviews and annual audits, that pace of 
engagement is not sufficient for projects under corrective action.
    We also are concerned that some airmen feel that they don't have a 
voice with their landlord and they don't know who to call when they 
have problems. While the Tenant Bill of Rights will help, and will give 
them locally arbitrated financial leverage, we think we need to 
increase training and information to families about privatized housing. 
The Air Force already does training with Wing Commanders about civil 
engineering support and privatized housing in our Wing Commander's 
course. We believe we need to extend that training to senior non-
commissioned officer and first sergeant courses. We also need to 
educate airmen on options and support available to them, likely from 
the local housing management office sometime after the chaotic first 
days when an airmen moves in.
                               conclusion
    The Air Force has a responsibility to provide safe and healthy 
living conditions to our airmen their families, and joint teammates 
living on our installations. We will hold project owners accountable 
for performance. While the majority of our airmen are satisfied with 
their living conditions, we have some privatized housing project owners 
who are not meeting expectations. We are addressing the housing issues 
we know about and taking steps to improve each airman's access to get 
help quickly and fairly. Air Force, Army, and Navy commanders will 
continue to communicate to take care of all joint members and their 
families. These steps will improve consistency across installations. 
Our services are stronger together. We live on each other's bases. The 
draft Tenants Bill of Rights is intended to start a conversation with 
the U.S. Congress, Air Force families, and our advocates in order to 
refine the document. We look forward to working with you on an 
enforceable Tenants Bill of Rights, as well as any other needed 
improvements.

    Chairman Inhofe. Thank you, Secretary Wilson.
    All right. For those of you who were not here during the 
opening of the meeting, we are going to have 7-minute 
questions, but we are going to hold you to the 7 minutes, 
because we have a full house here, and people do want to be 
heard on this subject.
    I'll start off, and I'll have my first two questions to 
address to the Army and to the Air Force, not the Navy at this 
point, and those questions are--and you decide which one is the 
best one to respond--number one, when were these issues first 
brought to your attention, and who should be held accountable 
because you were not aware of what was going on in your own 
service? Secondly, since these issues were brought to your 
attention, which installations have you personally visited 
specifically about the issue?
    Secretary Esper.
    Secretary Esper. Thank you, Mr. Chairman.
    On the first matter, I think, with regard to--the full 
realization of the size and scope of this issue came up the 
week that the Committee held its hearing. I think the media 
reports, coupled with the report of the Military Family 
Association (MFA), and then culminating in the hearing, was 
what I think brought home to us the size and scale of that. 
That said, of course, last summer, we were aware of the lead-
based paint issues at some of our homes, such as Fort Benning. 
We quickly took a number of actions--we can talk about that--to 
address that problem, and had been working on it pretty 
diligently throughout the fall. Then, at a family forum in 
October, the Chief and I, as we meet with families and discuss 
issues, there were some housing issues in singular homes at, I 
think, Schofield Barracks and Fort Gordon, and another at West 
Point, where we quickly attacked those problems and remediated 
them, but nothing with regard to the size and scope that you 
heard from the witnesses that appeared before this Committee.
    Chairman Inhofe. The second part of that question was, 
since these issues were brought to your attention, how many 
installations have you and the Chief and--either supervised or 
personally visited?
    Secretary Esper. Yes, sir. I personally visited Fort Meade 
and Fort Bragg, and I'm supposed to go down to Fort Belvoir 
next week, and, of course, every time I visit an installation, 
I meet with families and do town halls, so I talk about this 
quite often.
    Chairman Inhofe. Chief, have you----
    General Milley. In terms of the timeline, Chairman, 
similar. The July-August timeframe for the lead paint. Then, in 
November--October-November, started becoming aware of some 
reports on mold. It really came into fruition at the time of 
the hearings and the media----
    Chairman Inhofe. Well, as far as both of you, I appreciate 
the briefing that you've given me, and I know that you've been 
very busy since the last meeting that we had. I appreciate that 
very much.
    Secretary Wilson.
    Secretary Wilson. Mr. Chairman, since your hearing, I have 
visited MacDill, Tinker, and Shaw Air Force Bases. With respect 
to----
    I'm sorry. Chief?
    With respect to awareness of the problems, Air Force was 
aware of construction defects at four bases, and on page 7 and 
8 of the handout in front of you, it highlights those dates on 
where we were aware of construction defects. The actions that 
we're taking there--I think, though, that, while the Air Force 
was managing those projects and getting construction defects 
taken care of, what we really didn't understand was the decline 
in trust and confidence in the airmen that problems would get 
fixed. That is, to me, the most important part of the hearing 
that you had that brought that forward to us.
    General Goldfein. Yes, ma'am. I'll just add that Chief 
Master Sergeant of the Air Force (CMSAF), Chief Wright, and I 
went to Keesler and Maxwell Air Force Base, and our findings 
were very consistent with the testimony that you heard from the 
families that came forward. I'll second what the Secretary 
said, that the most concerning to me that I found was the 
breakdown in trust that we've got to rebuild, as you've said, 
Chairman.
    Chairman Inhofe. Yes. Exercising back your memory of the 
previous testimony that came from the homeowners, was anything 
found to be inaccurate from their testimony?
    General Goldfein. No, sir. Very accurate.
    Chairman Inhofe. Okay.
    Secretary Spencer, would you respond to the same questions? 
I have a separate question for you.
    Secretary Spencer. Yes, Mr. Chairman. Since the hearings, I 
personally have visited three communities in the Hampton Roads 
area--Camp Lejeune and Cherry Point--to visit housing and meet 
with people there. We stepped right out, right after the 
hearings, went out to the West Coast--our office did--to 
inspect what was going out there, and hearing from the families 
of their concerns. Nothing we found that they reported was 
inconsistent.
    Chairman Inhofe. Admiral, do you want to add to that?
    Admiral Richardson. Sir, I personally visited Patuxent 
River and then facilities around the naval district in 
Washington area, and have flag officers who have also gone to 
the Pacific Northwest, the Southwest. We've got good eyes on 
this problem, and nothing that we've seen is inconsistent with 
the testimony and the--I guess, the witness of the residents. I 
would just echo that we became aware of this, I think, about 
the time that everybody else did, in terms of the magnitude of 
the problem, and the fact that the actual truth on the ground 
was differing to a great degree from the information that we 
were responding to, which is why we're getting after 100-
percent awareness.
    Chairman Inhofe. All right. I appreciate that.
    Secretary Spencer, a recent news article states that the 
Navy is moving forward with creating a new Assistant Secretary 
for Information Management, which, by default, would eliminate 
your Assistant Secretary for Energy, Installations, and 
Environment. Now, that second one I mentioned is the part of 
the bureaucracy that is responsible for what led to this 
meeting now.
    Now, you came to our Committee, both the Majority and the 
Minority, and said you wanted to make an announcement. But, we 
told you not to, and you did it anyway. I'd like to know, first 
of all, why you did it. Secondly, would you be in a position 
right now to commit to this Committee to not dispose of the 
position that is responsible for the problems that led to this 
committee today. It's--at the conclusion of this meeting.
    Secretary Spencer. Senator, I'll take full responsibility 
for what my office does. I did speak to your staff and the 
Ranking's staff about the idea that we wanted to put together 
in light of the cyber report, which you will soon be exposed 
to, that we did in the Navy after we had our exfiltrations. 
It's a risk that we have to manage. I apologize for my office 
getting ahead of the lights. That was not my intent. We are 
marching along. We will keep everything in place, as is.
    Chairman Inhofe. Okay. Will you commit to keeping----
    Secretary Spencer. That's----
    Chairman Inhofe.--that position, your current Assistant 
Secretary for Energy, Installations, and Environment?
    Secretary Spencer. I will.
    Chairman Inhofe. Very good. Thank you.
    Senator Reed.
    Senator Reed. Thank you, Mr. Chairman.
    Thank you for your testimony.
    I'll begin with the Army, and who's ever appropriate can 
respond. I would hope that the housing companies are 
cooperating with you in addressing these problems. Some might 
require contractual changes. Is that cooperation evident and 
positive and genuine?
    Secretary Esper. So far, yes, sir. The Chief and I and our 
senior Army leaders met, within several days of the hearing, 
with all seven companies. I think they were saying the right 
things. They agreed up front to--for example, eliminating 
nonrefundable fees. They agreed to suspending the energy 
program, and a number of things. But, I think, over time, there 
will be more challenging tasks at hand, such as renegotiating 
lease agreements at the installations. We need to restructure 
the incentive fees. So, time will tell, and I think the 
oversight by this Committee helps give us the leverage to push 
those changes through.
    Senator Reed. I know that the Chairman and I are both 
committed to oversight continuously on this issue until all the 
problems are resolved.
    Some of the suggestions that have been made--and just get 
your reaction on the last--the other services--a uniform lease 
for all military personnel, the ability to withhold BAH if 
there's unsatisfactory response to complaints. Perhaps that has 
to be validated by your housing officer, but----
    Secretary Esper. That's right.
    Senator Reed.--at some point, the BAH should be not the 
right of the company, but in payment for adequate housing. Is 
that something you're producing?
    Secretary Esper. Yes, sir. That's one of the items we put 
into the Tenant Bill of Rights, is the ability to withhold BAH, 
and then, at least for the Army, we would--we could arbitrate 
that issue between the provider and the soldier, and make sure 
we come out to a proper solution.
    I think, on your first point, with regard to a common lease 
agreement, I think it's fair. It's the right thing to do for 
our servicemembers, because I have Navy personnel and Air Force 
personnel on Army bases, or Army personnel on Navy bases. I 
think the ability for a servicemember to go from base to base 
to base and have a common set of expectations with regard to 
the type of housing that will be provided would be very helpful 
to the force.
    Senator Reed. Then all I would ask is, as you go forward 
and there are issues you think should be properly covered in 
the NDAA, if you could make the Chairman and myself aware of 
them, we'd appreciate that----
    Secretary Esper. Yes, sir.
    Senator Reed.--very much.
    Secretary Esper. Will do.
    Senator Reed. Secretary Spencer, with respect to the Navy, 
you're cooperating, so far, productively with the housing 
companies, and you're trying to implement many of the similar 
proposals that Secretary Esper is?
    Secretary Spencer. Yes, Senator. We're having--I would 
actually call them fairly robust conversations with the 
partners--again, to get back on education, communication, and 
attention.
    Senator Reed. Very good.
    Issues like a uniform lease, issues with respect to 
withholding BAH, you're considering those?
    Secretary Spencer. Most definitely. It goes along with the 
Bill of Rights. When the three of us were talking about the 
creation of this, we realized that we wanted to get something 
out there in draft form for you all to view, for the 
communities to view. There is a lot of work to be done on this, 
because we will revisit the operating agreement, more than 
likely. It's going to take time, but we've got to get it right, 
because it's a good tool.
    Senator Reed. Secretary Wilson, your comments.
    Secretary Wilson. Senator, I also think that the idea of a 
common lease makes sense, because we do have members on each 
others' facilities. As my colleagues mentioned, the draft of 
the Bill of Rights that we released yesterday does allow for 
withholding of Basic Allowance for Housing.
    Senator Reed. One of the issues that I think has come up 
with respect to new construction--you mentioned, Secretary 
Wilson, that you found some problems in construction. Housing 
code standards are--you know, it's funny, you go out the front 
gate, and the jurisdiction of the municipality has rigorous 
housing code standards which people meet. I got the impression, 
from talking to the families, that there's no real housing 
codes, that it's what the company does or what, essentially, 
you allow them to do. So, would it be useful to develop, sort 
of, standard housing codes, in terms of initial construction 
and maintenance?
    Whoever wants to jump ball.
    Secretary Spencer or Secretary----
    Secretary Spencer. In the case of the Navy, sir, NAVFAC 
[Naval Facility] oversees with the ultimate arbiter and creator 
of the standard in that regards.
    Senator Reed. Those standards are--the commanders at the 
bases are aware of those standards? The personnel are aware of 
those standards so that they can, if they have legitimate 
complaint, they can make it?
    Secretary Spencer. That, I am not aware of, Senator. I can 
get back to you on that.
    [The information referred to follows:]

    Secretary Spencer. There are various provisions in the 
Public Private Ventures (PPV) agreements that require the PPV 
partners to comply with applicable housing codes. Additionally, 
certain Unified Facilities Criteria are incorporated into 
housing inspection checklists where applicable. The Navy and 
Marine Corps are working to educate commanders, personnel, and 
residents on the three-step process for reporting and resolving 
any and all defects in housing units.

    Senator Reed. My--again, an impression, from talking and 
listening to the families, was that there was no clear idea, by 
either the post housing authorities or anyone else, of what, 
really, the standard was. You could have a situation where they 
could come 52 times to make minor repairs and not effectively 
deal with the problem.
    Secretary Spencer. Just to clear the record straight, I was 
commenting on original construction. When it comes to 
maintenance calls, your observation is correct. That is one of 
the things we're getting at, is the ability to put the tools in 
the hands of the military family--without taking up too much 
time, quickly, to photograph the problem, track the problem, 
send the photograph back to the maintenance people if they 
don't think the problem has been corrected. The chain of 
command is in that communication loop. That is the primary leg 
of communication.
    Senator Reed. Secretary Esper, you had a point.
    Secretary Esper. Yes, sir. Senator Reed, you're pulling on 
a very important thread, here. As we've assessed the situation 
to date within the Army, one of the things we realize we need 
to work on, we need to improve, is the education of our 
garrison commanders and our sergeant majors to effectively do 
their job, whether it's oversight of the contractors, 
understanding building codes, quality assurance, quality 
control. All those things, we need to--and working to build 
that into their training, into the program of instruction. 
We're looking to do the same thing with regard to our 
commanders in the pre-command courses, reeducating them, if you 
will, on housing management and what their role is as 
commanders and leaders.
    Senator Reed. Let me reiterate what I think the Chairman 
expressed very clearly. This is a issue that we will stay 
engaged with, and it will take a while. We understand that. 
But, this is not going to be a passing sort of review and trust 
to the goodwill and good wishes of everybody involved. We're 
going to keep our--involved and engaged, and any aspects of the 
NDAA that has to be modified to help you make sure that the men 
and women of the services have the best housing, just let us 
know.
    Thank you.
    Chairman Inhofe. Thank you, Senator Reed.
    Senator Wicker.
    Senator Wicker. Thank you, Mr. Chairman, and thank you, to 
the witnesses.
    What I think I hear is a determination to really get to the 
problem and fix it. I know that's the determination up here, 
and I appreciate what Senator Reed just said about staying 
after this.
    As an Air Force veteran, let me direct my questions to 
Secretary Wilson and General Goldfein.
    General Goldfein, I appreciate you visiting Keesler 
recently. Let me start by asking you what you found there. To 
summarize, this has been an ongoing problem for quite some 
time, dating back as far as 2011 at Keesler. There is a program 
called the Moisture Remediation Project, MRP. Some of the 
information we've gotten from the military members there is 
that this has been sort of a surface attempt to go in and clean 
the affected area with soap and water or some sort of 
disinfectants, and not get behind and actually go the root 
cause. This went so far as 11 families at Keesler having to 
file a lawsuit against the contractor in the summer of last 
year, seeking punitive damages and accusing the company of 
fraud and concealment. So, it's a serious problem that's been 
there for a long time.
    Let me ask you this. In addition to telling us, Senator--I 
mean, General Goldfein--what you found, to what extent are 
military members required now to live in base housing? When I 
was a young officer, I had the option. I could go off base, get 
my basic allowance, and rent or buy off base. To what extent is 
it more or less a requirement to live in this housing now? Is 
this a problem inherent in the way we do privatized housing 
construction now, or is this--can this happen either way we do 
it? If you would talk about those things, and then I might let 
Secretary Wilson follow up.
    General Goldfein. Thanks, Senator. You know, when I went 
down there, I looked at the remediation program, the mold 
remediation program they're doing, and dug into the issues that 
they're looking at. What I found there--so, I'm going to, you 
know, be 60 years old this year, and I've lived in military 
family housing now for 50 years. I grew up in it, I raised my 
children in it. When I deployed for 2 years, I put my family in 
it. What I found at Keesler, which was very consistent with the 
testimony we heard, is, there are three things that families 
today are worried about that I never worried about, either as a 
parent or as a kid, growing up. I never once worried about the 
health of my children, relative to living in a home, and we now 
have families that have testified--and I saw that at Keesler--
they're worried about the health of their children.
    The second thing I never worried about--you know, living on 
base is the ultimate gated community experience. It's the one 
place where your kids can play until dark. I never worried for 
my kids about the safety and security of the infrastructure in 
the neighborhood, and parents of airmen today are concerned 
about that.
    The third thing I never worried about? I never worried 
that, if I actually complained about the housing, that there 
would be a fear of reprisal or that my command chain and 
leadership wouldn't get after it.
    As we look through the long-term fixes that Secretary 
Wilson laid out for the Air Force, we have to get at those 
three issues. Senator Reed, what you said about this being a 
long-term issue--you know, excitement in the near term, based 
on hearings is interesting, not compelling. We're going to have 
to keep our boot on the throat of the underperforming 
contractors and our command chain and leadership to make sure 
we get after this for the long term, and we're committed to do 
so.
    Senator Wicker. Do they have to live on base housing now?
    General Goldfein. No, sir. Matter of fact, there's a 
waterfall approach that we take. It's somewhat unique to the 
individual installation. But, they have the choice to live on 
or off base.
    Senator Wicker. Do you think there's something wrong with 
the program, itself?
    General Goldfein. Sir, I think the program has got to work. 
We've got to make it work. Where we have failed is to ensure 
that we have command-chain involvement, oversight, leadership, 
quality control, and followup.
    Senator Wicker. What did you find with regard to this 
Moisture Remediation Project, MRP, with regard to the 
accusations that they're just treating the surface and not 
getting back in there and finding the problem?
    General Goldfein. From what I saw, far more thorough a 
construction effort than what's been described. I did not see 
any painting over. I saw complete reconstruction, pulling out 
walls, going into the pipes. So, I thought I saw much more 
significant engineering work to get after it. But, this is a 
trust-but-verify solution for the future.
    Senator Wicker. Is the contractor doing that?
    General Goldfein. They are.
    Senator Wicker. Okay.
    This is a little off the subject, but let me just mention 
this and ask you to answer on the record. I've been concerned, 
for a number of years, about unaccompanied housing in Korea, 
particularly at Osan. If you could get back to me, on the 
record, about how many of our enlisted airmen at Osan are now 
having to live in barracks that are not yet remodernized and 
remediated--if you could get back to me, on the record, about 
that, I would appreciate it. It's been something I've been 
asking about for years and years.
    [The information referred to follows:]

    General Goldfein. Thank you for the question Senator 
Wicker. None of the 3,200 airmen at Osan Air Base are living in 
unacceptable dormitories. Any dormitory rooms identified as 
unhealthy or unsafe are not available for occupancy. Osan Air 
Base has 37 dormitories, 35 of which are required to house up 
to 4,200 unaccompanied airmen. Seven are currently undergoing 
renovation, with one additional dormitory scheduled to begin 
renovation later this year, and two dormitories are unoccupied 
awaiting demolition. These efforts will ensure all dormitories 
at Osan Air Base meet contemporary living standards, while also 
correcting any life, health, and safety concerns.

    Senator Wicker. So, thank you very much.
    General Goldfein. Yes, sir.
    Chairman Inhofe. Thank you, Senator Wicker.
    Senator Kaine.
    Senator Kaine. Thank you, Mr. Chair, and thank you, to the 
witnesses.
    The hearing, 3 weeks ago, was very gripping, very graphic: 
poor communication, poor physical condition, possibilities of 
retaliation, and overwhelmingly, a lack of military oversight 
of this program. I'm going to be touring Norfolk Naval Base 
tomorrow and meeting with families there. The housing 
companies, the seven, they must improve, but it's the military 
that must solve this problem. People didn't enlist to be a 
tenant of a private housing company, they enlisted to be a 
marine, a soldier, a sailor, an airman or woman, or a coastie. 
Their deal is with you, really, not with the housing company. 
You are obligated to solve this problem for them.
    A few questions. My understanding is, the contracts with 
the private housing providers, since it was a new initiative, 
offered the opportunity for the military to reopen the 
contracts at the 5-year point to see how the program was doing, 
and yet that opportunity was not taken up by the military. Is 
that your understanding?
    Secretary Spencer. Senator, as far as I'm concerned, that 
is my understanding. The program, at that point, seemed to be 
going swimmingly well, and I gather no one availed themselves 
of the opportunity.
    Senator Kaine. Any different testimony on that, or is that 
generally understood?
    Thank you.
    I was a mayor, and I had a Code Office that used to do code 
compliance inspections at housing all over my city. In the 
first hearing, we asked the housing providers--I asked the 
question about whether they would agree with me that somebody 
living on a base shouldn't be living in housing that is 
substandard to the housing that surrounds the base. And they 
all agreed with that proposition.
    In your dialogue about solving this problem, are you 
contemplating using the expertise of existing local housing 
code compliance officials to try to make sure that housing on a 
base is, at a minimum, equal to the standards in the 
surrounding communities?
    Secretary Spencer. Senator----
    Senator Kaine. Secretary Wilson and then Secretary Spencer.
    Secretary Wilson. Senator, we actually think that we need 
to improve the quality assurance--many of these within our 
military housing offices, because those are the ones that are 
responsible to the base commander, and that this is a command-
chain issue, and where we've had private housing contractors 
who are underperforming, we haven't really had the support 
there for the wing commander to go in and do the quality 
assurance that needs to be done. We think that that's where it 
needs to improve.
    Senator Kaine. Secretary Spencer?
    Secretary Spencer. Most definitely, across the board, 
Senator. You've heard me say it before. I'm a firm believer 
that we find the best practices, wherever they may be. Here is 
an industry that is a robust, mature industry in North America. 
Yes, we can find best practices and incorporate it in our 
system.
    Senator Kaine. I can see challenges of using local 
officials. They might be pretty busy. But, the idea of bringing 
in local code officials a couple of times a year--base 
commander might work with them to come in and do spot audits on 
a number of communities. Code offices would be thrilled to help 
you with something like this. That's not to say that the 
military shouldn't have its own expertise, but, when you have 
code compliance officers who do this, day in, day out, in the 
very communities where these folks live, who would be willing 
to help you, I think you should take advantage of that 
resource.
    We will be voting next week on the President's emergency 
declaration. The President's proposed to pull $3\1/2\ billion 
out of the MILCON [military construction] budget, $2\1/2\ 
billion out of the drug interdiction budget within the DOD. 
That funding source only has about $85 million available in it 
right now. And so, the reports we've read suggest that there 
would be an effort in the Pentagon to pull money from other 
accounts into that account, to plus it up to $2\1/2\ billion. I 
am very worried, in contemplating this particular challenge, 
that, should this go forward, some of that $6 billion could 
come out of monies that would be needed to solve this problem.
    I don't know whether you can answer this question or not, 
but I want to ask it. Can you assure me that none of the $6 
billion that is being pulled from the Pentagon budget to deal 
with what General O'Shaughnessy testified last week is a 
nonmilitary emergency--can you assure me that none of that 
money will come from funds that were slated to be used to deal 
with base housing either here in the United States or overseas?
    Secretary Esper. Senator, I can assure you that that is 
certainly my position, as well. And I've articulated that to 
Secretary Shanahan. I think there's general agreement within 
the Department that we should not tap into either military 
housing or barracks, I should add. But, I don't have final say 
over that, so I cannot give the--100 percent assurance. But, 
that's my view.
    Senator Kaine. That's your recommendation?
    Secretary Esper. Absolutely.
    Senator Kaine. How about to the other secretaries?
    Secretary Spencer.
    Secretary Spencer. Same here. The prioritization, it's 
right up there, and that would be my recommendation. Senator 
Kaine. Right.
    Secretary Wilson.
    Secretary Wilson. That is my position, as well.
    Senator Kaine. Thank you very much.
    Let me ask one more question. The testimony last week--this 
hearing is very focused on military family housing, as it 
should be. What are you doing to look at housing for single 
members of the military? Are you also engaged in that effort to 
try to make sure that they are living in conditions that aren't 
substandard?
    Secretary Esper. Senator, with regard to the inspections we 
have underway right now, those also include barracks where our 
soldiers live, so we want to make sure that we're picking up 
some issues there in the barracks, also--so, we want to make 
sure we address that. Overall--and Senator Reed mentioned it--
we want to make sure that we're also checking in on our 
soldiers who are off base. I think we have a responsibility to 
take care of our soldiers, wherever they live, and their 
dependents.
    Senator Kaine. Secretary Spencer.
    Secretary Spencer. Again, Senator, as we said earlier, the 
three of us are working together on this issue, and we're in 
lockstep, doing the same thing that the Army's doing.
    Senator Kaine. Great. Thank you.
    Secretary Wilson--or General Goldfein.
    General Goldfein. Thanks, sir. During my trip to Keesler, I 
went and visited the dorms. I walked through the dorms, as 
well, dorms built in 1951, and so, as we take a look at this in 
the future, we're going to make sure that we do not only 
military family housing, but all housing where airmen live and 
work.
    Senator Kaine. Mr. Chair, thank you.
    Chairman Inhofe. Thank you.
    Senator Rounds.
    Senator Rounds. Thank you, Mr. Chairman.
    Let me begin. Ellsworth Air Force Base is in Rapid City, 
South Dakota, and I--immediately when this started to come up, 
my thoughts went back to what we have for housing at Ellsworth 
and so forth. My first question, I guess, would to Secretary 
Wilson. I'm just curious. We all agree the maintenance issues 
that we're discussing here today are simply unacceptable. Is 
privatized housing still a viable option for our military 
families? If privatized housing is still the appropriate and 
viable approach, what immediate and long-term actions would you 
propose to fix these types of problems?
    Secretary Wilson. Thank you, Senator. I think many of us in 
this room remember what housing was like in the mid-1990s and 
early 2000s. While we are having problems with some of our 
private contractors, I think, overall, housing is in better 
shape than it was at the time that this initiative was started, 
and so, I believe that--and I saw it myself at bases in New 
Mexico at the time, and I--as a young officer, I never lived 
on--in on-base housing. I lived off base, as a single officer. 
But, I do think that the housing is better than what we had in 
the 1990s, overall. That doesn't mean that we change our 
approach to demanding that, when there is a problem, it is 
promptly fixed, and fixed in a competent way.
    There are a few things that I think will help. The Tenant 
Bill of Rights, I think, will help, and it will allow us to 
have some leverage to work through these contracts and change 
the way things are managed. I think we do need to strengthen 
the role of the base commander so that they have input and 
control and leverage with the local contractor. I think we need 
to improve the communications and feedback loops for our airmen 
so they have multiple ways to address problems, and, if they're 
not getting response, to get somebody to help them in the chain 
of command, and finally, we have an IG review underway that'll 
identify other systemic fixes that the Chief and I will deal 
with. Those are long term.
    In the immediate term, we've got our command chain that has 
identified and gone through houses, and we are focused on 
fixing the problems that are identified.
    Senator Rounds. Secretary Spencer, the same question. Would 
you agree that this is still a viable option and should be 
continued?
    Secretary Spencer. Senator, when the hearings finished, one 
of the things that I did was sit down with three of the authors 
of this actual solution, back in 1996, and spent some time with 
them as to how they addressed the problem they were solving, 
and what the solution was. If you look at the history of where 
we've been and where we are now, as an example, the service 
secretaries met with the Private Partner Venture partners once 
a month. Base commanders met with the local Private Partner 
Ventures once a month, and the program was going along quite 
well. The fact of the matter is, we did take our eye off the 
ball. We know that. That's why I'm telling you this is--to 
solve this problem, we have what we need right now, 80 percent 
of it, and we'll let you know, obviously, if we need more as a 
backstop or whatever we can call on you for the NDAA.
    This is a viable solution. I was a single person also when 
I was in the Marine Corps, but I have vivid memories visiting 
my married friends, and the product is a much better product 
that we have now. That does mean that we need to fix this. I 
think the tools that we have in the immediacy and the long term 
will affect that.
    Senator Rounds. Thank you.
    Secretary Esper, same question.
    Secretary Esper. Yes, Senator. From everything I've learned 
to date, I believe it's a workable model. We need to continue 
to study the issue and get back to you with any 
recommendations. I think any program, over time, needs 
adjustments, and that's the piece of this we owe you, in 
addition, obviously, to the initiatives we are implementing and 
the need for the chain of command to get back involved.
    Senator Rounds. Thank you. I think the idea of a Bill of 
Rights is very important, and I think it's one that I think 
perhaps this Committee may very well want to play a part in, in 
terms of determining what it actually looks like. I also think 
the fact that you have an ombudsman as a part of the discussion 
is going to be critical, because I think there's something else 
that has to be discussed, and we haven't really talked about it 
yet, but there's clear evidence of negligence, perhaps fraud, 
breach of contract, with regard to the contractors and the way 
that they have, in some cases, managed their responsibilities. 
I think this list may very well continue to grow as you inspect 
these facilities. Why have we not taken these contractors to 
court, suing them on behalf of our families and our Government? 
Is the Government too cozy with these contractors to show them 
what they have done wrong, perhaps immoral, and, in some cases, 
outright illegal?
    Secretary Esper.
    Secretary Esper. Senator, I think you're asking many of the 
same questions we are asking internally. I think we need to 
look at the accountability aspects of this. I have walked 
through some homes where I've seen work done, where I don't 
know whether it is just simple, pure incompetence or some type 
of fraudulent--fraudulence or negligence. But, you know, our 
immediate challenge right now is fixing the problems before us 
with regard to work orders, and getting the families right. 
But, I do think we need a deeper look at the accountability 
aspects of this.
    Senator Rounds. Will you commit to following through and 
reporting back what you find with regard to any anomalies that 
have to be pursued through legal channels?
    Secretary Esper. Yes, sir, absolutely, and particularly 
with regard to retaliation. That's one of the issues most 
acutely that troubles me. In fact, I had a discussion just 
yesterday with one of the CEOs about an employee, and I was 
very clear in stating that, ``I want this matter looked into, I 
want to know what you find, and I want to know how this person 
will be held accountable if this behavior was ongoing.''
    Senator Rounds. Very good.
    I have 1 minute left. Secretary Spencer, same question.
    Secretary Spencer. Same answer with--we took a step 
forward, we are launching Naval Audit to actually provide some 
audit functions in certain areas where we have concern.
    Senator Rounds. Thank you.
    Secretary Wilson?
    Secretary Wilson. Senator, we take all indications of fraud 
seriously. We investigate them and will act accordingly.
    Senator Rounds. Thank you.
    Thank you, Mr. Chairman.
    Chairman Inhofe. Thank you, Senator Rounds.
    Senator King.
    Senator King. Thank you, Mr. Chairman.
    The key thing coming out of this, it seems to me, is that 
good intentions and emergency discussions and these kinds of 
reassurances aren't going to solve this problem. This strikes 
me as a structural problem, and I want to focus in on the 
contract with these entities. Because one of the problems is, 
the customer on those contracts is the Navy or the Army or the 
Air Force, not the tenant. So, any enforcement of contract has 
to rest upon the Navy, the Army, and the Air Force. Do you see 
what I'm saying? That there's a disconnect there. So, I presume 
these contracts--I'll ask you, Secretary Spencer--are 
incentive-based, there are incentives for good performance. Is 
that correct?
    Secretary Spencer. That is correct, Senator.
    Senator King. My second question is, can these contracts be 
modified in any way now? I know some of them are really long 
term, like 50 years. Is there any reopener or opportunity to 
renegotiate at all?
    Secretary Spencer. I would--it being a document of 
operation, I would hope we can--I'm not a lawyer, but I--we 
plan to actually open it up and address it with the venture 
partners.
    Senator King. I think that would be important. The 
incentives, it seems to me, have to be important. There should 
be an approval rating, surveys of the tenants, and if it's not 
above 90 percent--I understand, in some of these contracts, 
it's 75 percent. That's pretty low bar, and they don't get paid 
if they don't meet that. That's the structural part of it, 
seems to me, that needs to be addressed.
    Secretary Spencer. I would agree.
    Senator King. the question is--let's say you had a perfect 
contract, but, if it's not enforced, if it's not managed 
properly by the service, then it's still not going to work. 
There has to be somebody, either at the base--and I don't know 
the answer to this--either at the base or at the Pentagon--I 
would think the base--who's responsible and who's accountable 
for the enforcement of this contract. My old management theory 
is, you need ``one throat to choke,'' somebody who is 
accountable. I hope that's part of your discussion.
    Secretary Esper?
    Secretary Esper. Yes, sir. I think there are multiple 
facets to this issue that have to be attacked simultaneously.
    Senator King. You can have a perfect contract, but if it's 
not managed properly, it's not going to work.
    Secretary Esper. Absolutely. The first contract is the 
contract that the leasing arrangement that a resident comes in 
and signs. That needs to be cleaned up, and that needs to be--
that needs to reflect what's in the Bill of Rights. We need to 
update that one. Then there's the contract at the garrison 
level, the one that includes incentive fees and stuff like 
that. Those incentive fees should also reflect what we want to 
pursue in the Bill of Rights. It needs to reflect that, as 
well, and then I need quality assurance people at each level 
handling it. As we discussed with the CEOs, we need qualified 
professional people performing the work. The Chief of Staff and 
I heard of instances where an employee would come in to fix 
something in a home, and he'd have to pull out his iPhone and 
watch a YouTube video to learn how to repair the work. T]his 
problem----
    Senator King. I do that, too, but I'm not a professional in 
repairing----
    Secretary Esper. Exactly. This problem has to be attacked 
on multiple levels, certainly from the contractors, and then we 
have an important role, at least with the Army, in terms of 
doing quality assurance, quality control, training our garrison 
commanders to make sure that we implement and enforce the 
garrison-level arrangements vigorously.
    Senator King. Well, Secretary Spencer, it seems to me that 
technology can help us out, here. You could develop a--I would 
call it a ``rat app,'' where the tenant can take a picture, 
send it--it would automatically go to the person who's 
responsible for managing the contract and the contractor, and a 
clock would start running, and there would be a way of keeping 
track of whether that repair was made, and how it was made, and 
how soon it was made. This is something that's within our--
within the realm of our capability these days.
    Secretary Spencer. Most definitely, Senator. That's the--
one of the three legs I was talking about: educate, 
communicate, and pay attention. We are actually having 
discussions with the venture partners right now about 
inculcating one of those.
    Senator King. Now, the word ``retaliation'' has come up 
several times in this hearing. And I don't quite understand 
that. Who's retaliating? Secretary Wilson, are we talking about 
the military folks on the base retaliating for a tenant 
complaining, or are we talking about the company? Who's 
retaliating?
    Secretary Wilson. Sir, I've asked, because I heard the 
testimony, and that was actually--from your hearing, the thing 
that bothered me most was--because if people feel as though, if 
they act, there will be retaliation, then they're not going to 
report problems and we're not going to know what's going on. 
The fear--the only one that I identified and talked to a member 
about directly, where there was a fear, had to do with the 
housing office calling the first sergeant of somebody and 
saying, ``Hey, your guy's making problems over here.'' In that 
case, the first sergeant talked to his member, and the airman 
said exactly what was going on, and he said, ``Wow. If you need 
my help, man, what it--how can I do to help--what can I do to 
help you?'' But, there is a fear of potential consequences if 
you complain, in some cases. Not that it's--I have not found a 
case where it happened.
    I would also say, though--you identified something that I 
think is important--that there was third-party payment----
    Senator King. Could you repeat that? I like hearing that in 
these hearings.
    [Laughter.]
    Senator King. I'm just kidding. Go ahead.
    Secretary Wilson. You mentioned third-party payment. I 
think this is one of those sources of frustration for our 
airmen. They sign a lease, but their basic allowance for 
housing goes directly, basically, from the Air Force to the 
contractor. If you were downtown paying your rent payment to 
your landlord, and you had a problem with rats or mold or 
whatever----
    Senator King. There's a direct relationship.
    Secretary Wilson. There's a direct relationship. You can 
report it. If you don't get a satisfactory answer, you can walk 
in and--holding your check, and saying, ``You know, I'm not 
going to give you this until you fix this problem.'' There's a 
greater feeling of control. I think that lack of direct control 
is the reason why, in this Bill of Rights, we've included the 
right to withhold your Basic----
    Senator King. But, it's----
    Ms. Wilson.--Allowance for Housing.
    Senator King.--all for naught unless the customer, which is 
you, enforce the contract on behalf of that tenant. That's a 
crucial part of this.
    I'm running out of time, but, for the record--not now, but 
for the record, could you all submit the copies of these 
contracts? They can be redacted for proprietary reasons. I'd 
very much like to see the terms and how the incentives are 
structured, and those kinds of things.
    Secretary Wilson. Yes, sir.
    Senator King. If you could do that for the Committee----
    Secretary Esper. Yes, sir.
    [The information referred to follows:]

    Secretary Esper. [Copies of the requested agreements have 
been provided and retained in Committee files.]
    General Spencer. [Copies of the requested agreements have 
been provided and retained in Committee files.]
    Secretary Wilson. [Copies of the requested agreements have 
been provided and retained in Committee files.]
    General Neller. [Copies of the requested agreements have 
been provided and retained in Committee files.]

    Senator King. Thank you.
    Thank you very much for your testimony.
    Thank you, Mr. Chairman.
    Chairman Inhofe. Thank you, Senator King.
    Senator Cotton.
    Senator Cotton. Good morning, to all of our service 
secretaries and service chiefs. We rarely see all of you 
together. I think that reflects the seriousness with which this 
Committee takes this problem.
    I think we've all had the same reactions to the very 
troubling reports of unsafe and unclean conditions at 
contractor-managed housing at military bases around the 
country. Stories are really terrible: kids struggling to 
breathe because of black mold, lead paint, rodent infestations, 
exposed wiring, doctors' office visits, where doctors plead 
with the family to move out for the sake of their child's 
health.
    My office has reached out to Colonel Donohue, the 19th Air 
Wing commander and installation commander at Little Rock Air 
Force Base, to explore the issue there. It's not perfect by any 
means, but it doesn't seem to have the same systemic problems 
we have seen elsewhere. They've got about 1,000 total units 
under private management. About two-thirds of those are 
occupied, and about two-thirds of those report no problems or 
did not request an inspection. That still leaves over 200 
visual inspections that identified problems that are currently 
being remediated, like moisture and lead paint and rodent 
infestation.
    Secretary Wilson, General Goldfein, I know that you will 
work to make sure that those conditions are remediated 
promptly.
    I also want to commend the Military Family Advisory Network 
(MFAN) for the work they've done bringing this situation to 
everyone's attention. We ought to address it with the utmost 
speed. We already ask a lot from our troops and our military 
families, to sacrifice in terms of their freedom and their 
comfort for ours. I think the least we can do is make sure that 
they have a safe, clean home whenever they get off duty or when 
they're downrange and their husbands and wives and kids are 
back, by themselves.
    I think we've explored a lot of the fundamental issues 
already, so I want to give our service secretaries and service 
chiefs an opportunity to speak directly to some of their troops 
and families around the world. I know that you don't often get 
a chance to do this, but this is a pretty high-profile hearing. 
It will probably be highlighted on the Armed Forces Network 
(AFN) and on military family social media sites and in your 
services' respective media outlets.
    Everyone on this panel has been a lieutenant or an ensign 
before, so I know you've all worked with junior soldiers, 
sailors, airmen, and marine to address their housing concerns. 
Obviously, when you sit in the Pentagon, at the top of your 
service, you can't have visibility into every single one of 
those, but I know we do expect our young platoon leaders and 
platoon sergeants and section chiefs to be on top of their 
troops' living accommodations.
    Starting with General Milley and going down the row, let's 
just speak directly to each one of those platoon leaders, 
platoon sergeants, squad leaders, and team leaders. You do want 
them to be on top of the living situation of every one of their 
soldiers, whether they live in on-base, off-post housing, or 
they have a family. Is that correct, General Milley?
    General Milley. That's correct, Senator, and I would say 
that, as it's been true for 10,000 years of military history, a 
commander, it's a very special duty position. It's a privilege, 
it's not a right. Our duty, as commanders, is to be responsible 
for everything our units fail to do or succeed at. That's a 
long tried-and-true tradition. That includes housing, 
readiness, training, fighting, taking the hill, doing whatever, 
and that includes housing. I want all of the soldiers out there 
to know that their chain of command is now fully engaged, and 
it is our personal responsibility, and we will be held 
personally accountable for the condition of their living 
quarters or their houses.
    Senator Cotton. Thank you.
    Admiral Richardson?
    Admiral Richardson. Senator, the same. It's a privilege to 
lead our sailors in the United States Navy, and I agree with 
you that the center of gravity is that small-unit leadership. 
It is not only a privilege to become a small-unit leader, a 
senior enlisted leader, or a junior officer, but it's also one 
of the most rewarding things that you can do, to develop those 
people under your charge. That development starts with ensuring 
that the fundamentals, the basics, are taken care of, and I 
would include not only housing, but also pay, food, safety, all 
of those things that are just absolutely fundamental to human 
existence. I'd just say, to all of our sailors and those small-
unit leaders, we're committed to making that relationship 
productive. Those leaders will be our sailors' advocates as we 
navigate through the recovery process, here. We will move out 
with urgency, and we will, to Senator King's point, establish a 
structure that will be sustainable so that we don't find 
ourselves here again in 5 or 10 years.
    Senator Cotton. Thank you.
    General Neller?
    General Neller. I would say this not just to the small-unit 
leader, but the entire chain of command. The Nation expects 
their marines to be the most lethal, ready force on the face of 
the Earth, and now we have a lot of things to do to achieve 
that requirement. Part of that is taking care of our families 
and our marines and where they live, whether it be in the 
barracks, whether it be in base, government-owned PPV or out in 
town. This is part of our responsibility. I mean, that goes 
with being a commander, being a leader. You're responsible for 
all your unit does or all it fails to do.
    I need everybody to understand why we're doing this. It's 
part of readiness. We need our families ready. A marine can't 
be ready if he or she's not living in a secure, safe place.
    I personally commit that we'll get after this. I agree with 
Secretary Spencer, I think--and Chairman Inhofe mentioned this, 
back in the day, it was a different place, a different time. I 
think we took our eye off the ball. We've been a little busy 
the last 17 years, as you know, Senator, but that's no excuse. 
We've got to reeducate ourselves about what our 
responsibilities are as unit leaders, and that includes taking 
care of the families.
    Senator Cotton. General Goldfein.
    General Goldfein. Thanks, Senator. When I talk to young 
command-team groups, senior officers, officers and NCOs [non-
commissioned officer], I tell them that a lot of things we do 
as senior leaders, we do the best we can. There's one thing we 
do that's nothing short of sacred duty and a moral obligation, 
and I believe it's our mirror check. That's to ensure that 
every airmen that we send into harm's way to do the Nation's 
business is properly organized, trained, equipped, and well 
led. Then, when they get the job done and return to their 
families, we've taken care of them while they've been gone. 
That's a moral obligation, and so, my message to all airmen is 
that we are not going to stop until we ensure that we have the 
system right to take care of them.
    Senator Cotton. Thank you, General Goldfein.
    If I could plead for 30 seconds, Mr. Chairman, I think it's 
very important that our troops hear this. As Senator King said, 
there have been reports of retaliation and reports of 
nonresponsiveness to complaints. I would just like our service 
chiefs to speak directly, once again, to their troops and 
assure us, yes or no, that there is zero tolerance for any 
retaliation if you complain about the conditions of your 
residence.
    General Milley.
    General Milley. Absolute zero tolerance.
    Senator Cotton. Admiral Richardson.
    Admiral Richardson. Same. Zero tolerance.
    Senator Cotton. General Neller.
    General Neller. Zero tolerance.
    Senator Cotton. General Goldfein.
    General Goldfein. Four.
    Senator Cotton. There you have it. Family members and 
troops on the front lines, when you have these problems, the 
top boss in every one of your services has said there will be 
zero tolerance, there will be immediate responses to your 
problems. You should bring them forward and make sure that you 
and your families have a safe residence while we work through 
the bigger structural problems we have.
    Chairman Inhofe. Thank you, Senator Cotton.
    Senator Heinrich.
    Senator Heinrich. Thank you, Chairman.
    Secretary Esper, I want to start with you, and I certainly 
agree that we need a Tenant Bill of Rights. We've heard a lot 
of really good testimony from all of you, and a lot of good 
questions from my colleagues, about using that as a tool to 
address the unresponsiveness between some of these contractors 
and people in the housing, as well as the issue of who is the 
customer. Because I can tell you, from personal experience of 
people who've reached out to me, both a concern that they would 
be held--or that there could be retribution when they raise 
issues, and then also the issue of not having the contractor be 
adequately responsive because they're not the customer.
    But, I want to switch gears and maybe come back to that 
issue and address the other half of this, because I think half 
of this is contract quality and enforcement of that contract, 
and half of it is basic standards and enforcement of those 
standards. I want to understand the lay of the land across the 
board. W heard from a former mayor. I'm a former city 
councillor. Any mayor, councillor, or county commission will 
tell you that the--we have tools to deal with this. They're 
building codes. I want to understand, across all of the 
services, what the current standards are.
    Secretary Esper, in the Army, what is the building code 
standard that base housing must be built to in your service 
branch? Is it uniform or is it governed by the local or State 
building code standard at the site?
    Secretary Esper. Yes, sir. My understanding is that, under 
the umbrella agreement under which this privatized housing 
operates, that the commitment is that the privatized housing 
would abide by local standards.
    Senator Heinrich. Okay.
    Secretary Esper. It would be overseen by them, as well. 
That said, I would want to take a look at what those standards 
are to make sure that they meet what our expectations are as 
leaders. We need to--we may need--well need higher standards 
and a common standard, if you will. We've talked a lot about 
commonality here with regard to leasing agreements. I think 
common standards, common high-quality standards are the way to 
go.
    Senator Heinrich. I think you're dead-on, and I think 
you're on to something here, because there is a patchwork of 
standards across the United States. County and city, we have--
you know, Secretary Wilson is very familiar with Kirtland Air 
Force Base, a few blocks from my house. They do not fall under 
the City of Albuquerque's jurisdiction, because that's where 
the boundary for the city stops. They're under the State or 
county standards. So, I do think it makes sense for all of us 
to look a uniform standard that may be a higher bar, for 
safety, for comfort, for energy efficiency, than what may be 
appropriate at the local level or what local politics might 
dictate.
    For the other service secretaries, what is the current 
standard, and what is your opinion on the sort of approach that 
Secretary Esper just----
    Secretary Spencer. Senator, to underscore the fact we 
probably need standardization, it's my understanding that we 
are held to a government standard, a DOD-oriented government 
standard. My naval facilities organization oversees the 
enforcement of those standards on original construction.
    Senator Heinrich. Secretary Wilson.
    Secretary Wilson. Senator, the Air Force Civil Engineering 
Center (AFCEC) does--oversees uniform DOD standard for 
construction. I think where we've had problems is in quality 
assurance of repairs, and quality control. That is often a 
manning issue, and we need to address that issue, base by base.
    Senator Heinrich. For each of the secretaries once again, 
who would be responsible in your service branch for performing 
basic inspections to make sure that either new or existing 
construction meets code and/or meets the standard for repairs?
    Secretary Esper. Senator, I think, if it's new 
construction, it's likely our Corps of Engineers would be 
responsible, and I think, in all cases, whether it's that and 
repairs, it would be the garrison chain of command. I'd be 
remiss if I didn't say, at the end of the day, the chain of 
command of that soldier being involved is--certainly on work 
orders, will be extremely important.
    To Secretary Wilson's point, we're looking at the same 
thing. As we staff up at all of our installations, making sure 
we have sufficient quality assurance, quality control 
personnel, at every step of the process, are involved and 
either doing a 100 percent, depending on the nature of--if it's 
an--life, health, and safety work order, or spot-checking if 
it's a routine work order.
    Senator Heinrich. Okay.
    Secretary Spencer.
    Secretary Spencer. In the case of the Navy, sir, CNIC 
[Commander, Navy Installations Command] and then that local 
housing office would be the responsible parties. Again, just 
reverberating what Secretary Esper and Secretary Wilson said, 
it's the quality control and quality assurance aspect that is 
going to be the real nuts and bolts to make sure that we 
enforce what we have.
    Secretary Wilson. Senator, on your bases, you will have a 
housing management office that is, as we mentioned, undermanned 
for quality assurance. The civil engineering squadron, with 
support from the Civil Engineering Center, assesses and--the 
compliance with code-like items.
    Senator Heinrich. I want to thank all of you for the 
commitment that you made to Senator Cotton with regard to 
retribution. I also want to ask, what are we doing to make sure 
that commanding officers understand that, as well as sending 
that message to the--to rank and file? I have had at least one 
constituent raise the issue that they were afraid to bring some 
of these issues forward. What is the mechanism, Generals and 
Admiral, for just sending that message, loud and clear, that, 
``We have an issue, and, if you raise issues, you're going to 
be listened to, and you're not going to be held to some form of 
retribution''?
    General Milley. The chain of command is command information 
mechanisms throughout the force to get that word out, but it is 
well understood that any sort of action, a reprisal action or 
retribution action, against anybody who raises a complaint 
about anything, whether it's the IG, the EO, the EEO, housing, 
or, you name it--it is illegal. It is not just against policy 
and regulation, it is illegal. You will be held accountable if 
you engage in any sort of reprisal action against anybody who 
raises a complaint about anything. It's zero tolerance, period.
    Senator Heinrich. Admiral?
    Admiral Richardson. Senator, if I could, I'd just agree 
with General Milley. But, just to make sure that we were clear 
here, it was a specific part of the NAVADMIN message that I 
sent to the Navy to make sure that we are particularly 
sensitive to this, because perception can be----
    Senator Heinrich. Right.
    Admiral Richardson.--as powerful as reality here.
    Senator Heinrich. Exactly.
    Admiral Richardson. Then, all of our--I did a social media 
post, made it clear there. The visit guidelines for visits to 
homes include a part of this, so we're being extremely 
sensitive to making sure that, certainly, we meet the legal 
requirements, but we also, from a perception/management thing, 
are open to this.
    General Neller. I agree with both the Chief and the CNO 
[Chief of Naval Operations]. In the white letter I sent out to 
all commanders, directing the housing outreach, with the intent 
to visit, at the permission of the servicemember, their home, 
either in a PPV or out in town. There is very clear guidance on 
what they can and cannot do, and whether they refuse the visit 
or not. But, as General Milley said, any reprisal on anyone who 
makes an allegation, it is illegal.
    Senator Heinrich. Thank you, Mr. Chair.
    Chairman Inhofe. Thank you.
    Senator Hawley.
    Senator Hawley. Thank you, Mr. Chairman.
    I'd like to go back to the subject of contracts. I 
understand that Senator King asked about some of these 
contracts with the private entities, and requested copies of 
relevant contracts. I'd like to see those, as well.
    But, let me begin by directing this towards the service 
secretaries. Secretary Esper, I noticed, in your written 
testimony, you talked about the model, this model of private 
housing, private partnership, and you say, ``It assumes--the 
model assumes that the contractors, with sufficient oversight, 
will continue to maintain the quality of these homes.'' I note 
the verb, ``assumes.'' Do these contracts lay out particular 
standards? Are these private housing operators, are they 
contractually obligated to maintain particular standards in 
these housing developments?
    We'll start with you, Secretary Esper.
    Secretary Esper. Yes, sir. I've reviewed a few of them, 
and, having read through them, there are standards in there. 
But, I do think we need to look into them, renegotiate them, 
and make sure that the standards are high and sufficient and 
meet the Bill of Rights that we've outlined here today.
    Secretary Spencer. Senator, the standards are there. We 
need to enforce the standards. It's, again, not a brilliant 
flash of the obvious. We were not keeping our eye on the ball. 
The housing office needed to be the quality control check and 
balance, here, if there was a complaint. We have the processes. 
Now we have to live up to performing the processes.
    Senator Hawley. Same for you, Secretary Wilson?
    Secretary Wilson. Senator, the contracts do have standards 
in them. The issue is ensuring that we enforce those standards 
when we have a contractor who is a sub-par performer.
    Senator Hawley. Under the contracts, who is charged with 
enforcing the standards? Have the--it's you? I mean, who has 
the authority, contractually, to enforce these standards and 
see that they're maintained?
    Secretary Wilson. Senator, in the case of the Air Force, 
the Air Force Civil Engineering Center has a contract manager. 
The housing management office actually has a dual chain of 
command to both the base commander and to the Air Force Civil 
Engineering Center.
    Secretary Spencer. Senator, we have the same structure with 
CNIC. But, to go back to what Senator King said, you need ``one 
throat to throttle,'' and that's the service secretaries. The 
structure that you'll hear about is that the Government is a 
passive partner in this. But, passive partner does not mean 
getting involved in standards and enforcing what we have. We 
have the agreement. Now enforce the agreement and the 
standards, and that can be done at our level on down.
    Secretary Esper. Senator, there's supposed to be an 
overarching RCI partner entity doing oversight. I think it's 
insufficient. At the Army garrison level, it would be, of 
course, our--again, our garrison command, through its 
Department of Public Works (DPW), doing that, And we need to 
staff back up and get more aggressive on that. One of the 
things we are proposing is, for example, 100 percent inspection 
of all life, health, and safety work orders, 100 percent 
presence in all transitions when somebody moves in or moves out 
of a home, and then spot-checking pretty aggressively all other 
work orders. Than, again, I'd be remiss if I didn't add in, the 
chain of command has the responsibility to check in on their 
soldiers, as well, if they're having problems with work orders, 
customer service, you name it.
    Senator Hawley. The Tenant Bill of Rights that each of you 
has mentioned now a number of times, will--do you anticipate 
incorporating that Bill of Rights into these contracts with the 
service providers so that they're contractually enforceable?
    Secretary Wilson. Yes.
    Secretary Spencer. Yes, Senator, that's exactly what we're 
talking about. This is a draft, but we want to fine-tune it to 
make sure it has the teeth, and the teeth relies on the 
contract agreement.
    Secretary Esper. Yes, sir. I think we need to 
operationalize each part of it into the individual home 
agreement between the provider and the resident. We also need 
to look at operationalizing key parts of it into the incentive 
fee structure and everything else so that we're hitting at 
multiple levels and enforcing it that way.
    Senator Hawley. Going back to--a second, to your oversight, 
and the thing about the garrison staff. We've seen reports that 
there's been significant cuts in the number of civilian 
employees who actually look at these installations, run the 
installations. In some cases, I've heard as much as 90 percent. 
So, that even if you do have the contractual--you're telling me 
now you have the contractual authority to inspect these 
properties, but it sounds as if there may have been nobody 
around to actually do it. Is that accurate? What are you going 
to do about it?
    Secretary Spencer. Senator, this is one of the observations 
that we've made, and one of the things we might be doing is 
coming back to you all for the direct-hire authority to 
increase staffing.
    Secretary Esper. Yes, sir, it looks like, over a period of 
time, beginning around 2010-2012, we began making reductions. 
We're anywhere from one person to ten people. We didn't go to 
zero anywhere, as best I can tell, but we did make reductions, 
and we're now looking at, how do we staff back up to ensure we 
can do adequate quality assurance and quality control, based on 
some of the ideas I shared with you earlier?
    Secretary Wilson. Senator, we have a similar kind of 
situation. One of the bases that I went to was one that was 
rated as performing well. When you have a contract housing 
office, where the contractor is performing well, we probably 
have enough people in that housing office to do the work. But, 
when performance starts to slide, that's when it becomes 
overtaxed. So, how we put the people back in to give support to 
the base commanders where it's really needed is going to be the 
key decision point.
    Senator Hawley. Let me go back, for a moment, to the 
contractual arrangements. How do you anticipate changing or 
altering these contracts in order to ensure that the private 
providers are appropriately incentivized and penalized, when 
necessary, for maintaining adequate housing, for responding in 
real time to complaints, and generally doing what they're 
supposed to be doing? Let's just cut to the chase here--I'm a 
lawyer. We can talk all you want about ideals and aspirations 
and Bills of Rights. If you don't make them enforceable, if you 
don't put them in contracts, if there isn't real bite behind 
them, it's not going to go anywhere, and we'll be right back 
here 5 years from now with people saying that, ``I know what 
the Bill of Rights are. There's nobody who I can go to enforce 
it. There's nowhere to get it done.'' We don't want to do that. 
So, what are you going to do to make it enforceable so that 
we're not back here doing this again in a few years?
    Go ahead, Secretary Wilson.
    Secretary Wilson. Senator, I'm not a lawyer, but I do 
understand the incentives and how they're not set up properly. 
I think that the answer to this is to get less quantitative 
about these incentives, because those can always be gamed. We 
need to put authority with the base commander so that that 
local contractor knows that the base commander can say, ``No, 
that work isn't good enough,'' and it can impact their bottom 
line.
    Secretary Spencer. Senator, I look forward to having the 
negotiations with the Private Partner Venture partners to see 
how we can come to a solution that provides us what we need for 
the product that we require to be delivered. I can't give you 
exact levers right now, but, like I said, in the whole Bill of 
Rights, it will not work, it'll be a puff piece, unless we link 
that into the agreements, whether at the local lease level or 
at the operating level.
    Secretary Esper. I completely agree with my colleagues on 
this matter.
    Senator Hawley. Thank you, Mr. Chairman.
    Chairman Inhofe. Thank you, Senator Hawley.
    Senator Peters.
    Senator Peters. Thank you, Mr. Chairman.
    Thank you for all of you being here. I appreciate your 
attention to this issue, and, obviously, very serious attention 
to the issue that you're taking.
    I think it's important for us to step back and take a 
personal look at how this is actually impacting an individual 
in a family. And I want to recognize that there are two folks 
in the audience here today from--are both Michiganders: Rachel 
Kilpatrick, who is a soldier stationed at Fort Bragg, in North 
Carolina. She's here with her husband, Calvin, and I had the 
honor of meeting with them, talking indepth about kind of the 
troubles that they went through, really kind of a nightmare 
that they went through in relation to their home. In fact, 
their home at Fort Bragg has been recently deemed unliveable. 
To think they were living in a home that was deemed unliveable 
is pretty outrageous. It was infested with termites, it had a 
severe outbreak of black mold, which caused significant health 
issues for her family.
    You're not going to be able to see this, but I'm sure 
you've seen some of these pictures. I'm sure, General Milley, 
Secretary Esper, you've seen some of this when you visited Fort 
Bragg. Thank you for being there. But, for the others, you 
know, this is a picture of their home. I'll describe it. 
There's this black mold all through the wood here in the 
frames, along the floor, along this beam. It's pretty 
despicable as to where they were living. It's no wonder that 
they've had some significant health impacts, particularly with 
Calvin, talking about respiratory issues related to that.
    What gets me as I see this, and then I hear from 
contractors who say that, ``Well, maybe we should adjust the 
BAH formula to provide more money for this.'' Then, this is a 
public picture that was out. This is the landlord for this 
property, who has 100-acre estate. I think this is his dining 
room. This is a pretty nice dining room for the landlord. 
Probably can't see that, but that's a pretty amazing picture. 
So, it doesn't sound like he's hurting too much, although he 
thinks, ``Maybe I can't maintain this property while I dine 
with my friends at this incredible mansion on 100 acres.'' It 
brings back visions of the term ``land lord'' back in the 
medieval days, where the landlords lived like this, and other 
folks lived like this. Of course, these folks are our soldiers, 
sailors, airmen, marines, who are serving our country, and 
serving it with honor. This is simply unacceptable for us to 
treat this way.
    Her husband, Calvin, is an example of someone who's now 
suffering from some health issues, some respiratory issues. He 
told me this morning that what he wanted to do was join the 
Army, that his wife was going to have--they were going to have 
children. He would join the Army. But, now, because of 
respiratory issues that may actually be a result of living in 
this condition, he won't be able to join the Army and serve his 
country, something that he wants to do.
    So, as we move forward--and all of you have made a great 
commitment to moving forward--what are we going to do about the 
people who are suffering from health issues as a result of 
living in these conditions in the past? Let's not forget what 
has already happened as we look forward. If you could tell me, 
how do we hold these landlords accountable for health issues? 
This is a process that supposedly was going to save taxpayer 
money, but now we have people in TRICARE and other health, 
we've heard instances where children may have been impacted as 
a result of living in these kinds of facilities. What are we 
going to do?
    We'll start with Secretary Esper, each of the secretaries. 
What are we going to do to go back to make sure those who were 
harmed in the past, that we hold these landlords accountable 
for what they did to some of our wonderful servicemembers?
    Secretary Esper?
    Secretary Esper. Well, Senator, first of all, for sharing 
that. I want to thank the family for coming forward, and, much 
as I did in all the families I've spoken to, the Chief and I 
and the spouses we met, again, wholeheartedly apologize that 
they have to live in such despicable conditions. It is 
unconscionable that that would happen. It's troubling, the 
story you convey.
    First of all, the first concern, obviously, is to the 
health of the soldier and the family members, and we've talked 
to our doctors about this. I visited Womack and spoke about 
this when I was at Womack Hospital, at Fort Bragg. Of course, I 
encouraged them to immediately see their primary care provider 
and, if they're not getting any attention, we'll meet with them 
immediately after this hearing and make sure we get them 
connected to the right people, specialists, as need be.
    I think you're right, over the long run, one of the things 
the Army is doing is making sure we can track the houses, and 
make sure we know who's lived in those houses, year over year 
over year, and certainly, of course, track the medical status 
of our soldiers and their dependents to make sure we understand 
if there are any relationships over the long haul. I think we 
need to pursue aggressively, if there's accountability, if 
there's something that was caused by active negligence of the 
private contractor, to hold them liable. But, at the end of the 
day, the Army's going to take care of its own. We're going to 
make sure that we take care of their needs, medically and 
healthwise.
    Senator Peters. Well, the important point is, you will hold 
these landlords accountable.
    Secretary Esper. Absolutely. I think they're the--the first 
recourse is--they had a responsibility to maintain quality 
homes, and, in that case, clearly, the homes I saw, that 
Senator Tillis joined me with down in Fort Bragg, they were not 
doing that, and in other places that the Chief and I and other 
members of the chain of command have doing, they are not 
maintaining the quality that they are responsible for.
    Senator Peters. Thank you.
    Secretary Spencer.
    Secretary Spencer. Senator, I reverberate what Secretary 
Esper just said, and, first of all, we have one of the best 
healthcare systems around for our sailors, soldiers, marines, 
airmen, guardsmen, and their families. That's number one, is 
their health. Number two is doing what you're talking about 
doing, which--hold accountability. The agreements, the master 
operating agreements, have the requirement for the product they 
have to deliver. They will be held to that standard in the 
contract.
    Senator Peters. Thank you.
    Secretary Wilson.
    Secretary Wilson. With respect to the health issues, the 
most important thing for a member who thinks their health has 
been affected is to go to the military treatment facility and 
get evaluated and treated, and have it documented. Each of our 
bases have legal assistance to help family members identify 
what their options are and to be able to work those through 
with respect to a claim towards this provider. But, it raises 
another issue, and I'll defer to the Chief on this.
    General Goldfein. Yes. Senator, you know, central to your 
question, too, is--you know, what Chairman Inhofe brought up in 
the beginning, which is, when did we know, and how did we know 
it, and how did we not see the breakdown in trust that was 
occurring? Now what are we doing about it to make sure that 
can't happen again? So, what we're putting in place is--there 
are five methods of what I call ``avenues of alarm,'' right, 
when there's safety or security--the issues like you bring up, 
that has to generate command-team action and followup. The 
first one is, you go to your housing management office, which 
is your first line of defense at the base, your advocate. 
That's got to trigger action and followup. The second is, you 
go to your command team, first sergeant or a commander. That's 
got to trigger action and followup. The third is, you go to 
your medical provider and say, ``I think I have a health 
concern with my children, and it's associated with my home.'' 
That can't stop within the medical community. It's got to get 
to the command chain and trigger an alarm. The fourth method 
is, if--I visited a Navy family who's living on an Air Force 
Base, and I was concerned with--that they were told, ``Well, 
you're Navy, so you have to go through Navy chain.'' Not on our 
bases. If they're on an Air Force Base, they're ours, and we're 
going to take care of them within the Air Force chain, and I 
know my teammates feel the same way about airmen on their 
bases. The final is a 24-hour hotline that they can call. If 
none of those top four work, they call the hotline. This 
morning, unknown to anybody in my staff, I called it and 
checked in to make sure that it is up and operating, and that 
the checklists are there. It's up and operating. We have some 
work to do on it. But, those avenues of alarm have got to get 
to the command chain and leadership so we can follow up and 
take action.
    Chairman Inhofe. Thank you, Senator Peters.
    Senator Ernst.
    Senator Ernst. Thank you, Mr. Chair.
    I want to thank everybody for coming forward today, and, 
Secretary Spencer, I think you painted it quite appropriately, 
that, you know, you're glad to be here, but you wish you 
weren't here. This is a topic that we shouldn't be addressing 
in today's age.
    I was a young military spouse, many, many years ago, 
married to an NCO, and we had similar issues. They are not 
nearly as bad as what we have seen from our families. I 
remember living in Indianhead at Fort Benning, Georgia, and the 
roaches were horrible, so bad that my husband and I did have to 
move into another set of quarters. They couldn't get rid of 
them. But, we had to do it at our own expense. I thought that 
that would have been alleviated, 20-25 years later. Obviously, 
it hasn't.
    Now, early 2000, living on Eglin Air Force Base, Army unit, 
belonged to Fort Benning, but we were living on Eglin. The mold 
problems in Florida, horrible. The guys living in our barracks 
out there on the ranger camp, subjected to holes in the walls. 
You could see daylight. It took a lot of arguing between the 
service branches to get that taken care of.
    This shouldn't happen, folks. We really owe it to our 
servicemembers to do better for them and their families. I'm 
thankful that you understand that. I'm just sorry that it took 
their situations coming to this level to be taken care of, when 
it could have been taken care of at a much lower level, in a 
more expedient manner.
    I'm glad we have the opportunity to straighten this out. My 
fear is that we'll raise the issue, we'll have these 
discussions, but we won't see the necessary followthrough.
    Do we have a timeline? I'd like to hear from all of you. 
We've talked about the Tenant Bill of Rights. We've talked 
about other types of actions that can be taken. But, what is 
our timeline, moving forward? When can we expect to see this? 
When will those corrective actions be taken for our families?
    Secretary Esper, can you start, please?
    Secretary Esper. Thank you, Senator, for your comments and 
your service, as well.
    I think we look at this, generally, in terms of immediate, 
mid, and near term. The immediate challenge right now is to 
knock down all the life, health, and safety work orders. That's 
happening right now on all 49 Army installations. Get those 
resolved, and then take care of the other work orders, as well.
    Then, I think, in the mid term, what we need to do is, at 
least with regard to the Army, staff up quality assurance, 
quality control. We need to make sure that we have adequate 
independent, objective reporting systems on our Army bases to 
make sure we understand soldier satisfaction with the customer 
service being provided, and a few other things there.
    Then, in the long term, we really need to--and I think this 
will happen over the coming weeks--we need to finalize the Bill 
of Rights, looking for input from Congress, and then begin 
negotiating that and the leases and all the other pieces of 
that, that we discuss today, to make sure we get it 
contractually bound for the long term.
    Then there are other longer-term issues: reeducating our 
garrison commanders, our chain of command. The bottom line is, 
this problem didn't come up overnight, it evolved over years, 
and I think it's going to take some time to get it finally 
resolved and in place and intact, and maintain the close 
supervision so it doesn't fall back off the radar screen.
    Senator Ernst. Secretary, do we have a timeline? What do 
you envision? What do you think is realistic? What can we tell 
our military families--when this will be implemented? Bottom 
line, Tenant Bill of Rights.
    Secretary Esper. Right. I want to believe we'll finalize 
the Bill of Rights, here, in the next few weeks, with your 
input, and then begin discussing with the contractors. The 
Chief and I have already had some discussions with them, 
generally in favor, in terms of principles we outlined 2 weeks 
ago. But, then I think it's the hard work at--Senator Hawley 
talked about--is getting lawyers and making sure we change all 
the agreements. I would hope that we'd be able to do this in a 
few short months, to make sure it's all in place and lined up, 
and then we're working against these new standards, we're 
working against contractual obligations, and we have our chains 
of command in place, with the right people at the garrisons to 
make sure that we do the new proper oversight.
    Senator Ernst. Secretary Spencer?
    Secretary Spencer. Senator, if you just cruise the Web and 
look for communities, whether States or right here in the 
District of Columbia, their Bill of Rights for Tenants, almost 
every single case I looked at, each item in the Bill of Rights 
was backed with a code. That's what we have to do, in that 
light, is to put the teeth in the agreement that references the 
terms that we're giving them. I agree with Secretary Esper. I 
want to make sure that we get this in its fundamental basis 
through your-all's input, families' input, et cetera, and then 
sit down with the Private Partner Ventures.
    I will tell you, just to manage expectations, some of the 
things we'll ask for will probably take bondholder concurrence, 
so there are parties that have to be addressed, here. I would 
say 90 days, is what I'd be looking at, just my eyeball of it.
    Senator Ernst. Okay. Thank you.
    Secretary Wilson?
    Secretary Wilson. Senator, I completely concur with my 
colleagues on this.
    Senator Ernst. Okay. I appreciate that very much.
    Now, I thought it was really interesting, Senator Peters 
bringing up the ``land lords.'' Truly, different situation, 
centuries ago, but it begs the question--we know that the 
garrison commander typically makes the determination each 
quarter on the percentage of the quarterly incentive or bonus 
payment that the private-partner landlord receives. What is 
that average percentage that those landlords are receiving, 
that private partner? Do we know what that is? Can that be 
presented here today?
    Secretary Wilson. Senator----
    Secretary Esper or--oh, Secretary Wilson, did you----
    Secretary Wilson. Senator, I was just going to say, in 
our--we have 32 different agreements, those 32 different 
contractors. Two of those 32 have no incentive fees.
    Senator Ernst. Okay.
    Secretary Wilson. Thirteen of 32 don't have the garrison 
commander or the base commander evaluation. Seventeen of 32 do 
have a base commander evaluation component. Where we have it, 
it's generally between 5 and 10 percent of the total fee that's 
influenced by the base commander. We don't think that's 
sufficient.
    Senator Ernst. Okay, thank you.
    Secretary Spencer. I interpreted the question differently, 
Senator, in that, what are we actually paying in incentive 
fees? We do ours at the regional level, which is a--here's an 
example of what we're rethinking, which is to deliver the 
ability to award the incentive at the base level. But, in our 
levels, we're somewhere around 75 to 80 percent of incentives 
paid. It should be noted that those incentives that aren't paid 
stay in the system and go into the sustainment fund, the 
reserve fund, just as a note.
    Senator Ernst. My time is expired, I apologize--and then 
I'm assuming that reserve fund is held in trust, or is that 
used to----
    Secretary Spencer. That is--it is held in trust, with an 
agreement on how it is used for capitalization.
    Senator Ernst. Okay. Thank you.
    Thank you.
    Chairman Inhofe. Thank you, Senator Ernst.
    Secretary Esper. Senator, I know you're out--we'll get you 
that information, as well.
    [The information referred to follows:]

    Secretary Esper. It is 92 percent of the requested 
incentive fee.

    Senator Ernst. Thank you, Secretary.
    Chairman Inhofe. Senator Warren.
    Senator Warren. Thank you, Mr. Chairman.
    Before the previous hearing, I sent out letters to all five 
of the private housing companies that testified, 2 weeks ago, 
to get some more data and background information on what was 
going on. They have since provided my office with the requested 
documents that I'd asked for in this letter. Representatives 
from three of those companies have met with my staff to explain 
how their business model works. The companies' summarized 600-
page complex, secret financial agreements into a single 
PowerPoint slide that clearly laid out how they actually don't 
make much money, and they only receive their fees after setting 
aside money for operating and maintenance expenses. Meanwhile, 
they also claimed that, because people don't have to live on 
base, they are properly incentivized to provide excellent 
service. If you believe the companies, it all makes sense, on 
paper. The market works perfectly. They said, in effect, 
there's no problem, the incentives are all working, the market 
works, nothing to see here.
    Let me just start by asking, Secretaries Spencer, Esper, 
and Wilson, do you agree that the housing market for base 
housing is working properly?
    Would you like to start, Secretary Esper?
    Secretary Esper. Senator, clearly it's not working.
    Senator Warren. It's clearly not working, right?
    Secretary Esper. I mean, we have too many problems. It's 
evidenced by what's coming out in our town halls and what this 
committee heard from the families, the families sitting behind 
us. It's not working.
    Senator Warren. So, we don't have any doubt about that.
    Secretary Spencer, you agree?
    Secretary Spencer. Totally agree.
    Senator Warren. Secretary Wilson?
    Secretary Wilson. Agree.
    Senator Warren. All right.
    So, the market isn't working as intended. We have to ask 
the question why it isn't working, intended. And the basic idea 
behind what it takes for a market to work is, there have to be 
rules, and there has to be someone who's willing to enforce the 
rules. Last week, the Army personnel chief told us, in a 
military personnel subcommittee, that the terrible conditions 
in which military families have been living are a leadership 
failure, plain and simple. Do you all agree with that 
assessment?
    Secretary Esper?
    Secretary Esper. Yes, ma'am. I think the chain of command 
over the past 20 years has slowly walked away from being 
involved in the housing of our soldiers and their families. 
Yes.
    Senator Warren. Everyone else agrees with this? I'll get 
you on the record, there.
    Secretary Spencer. That's true.
    Secretary Wilson. Senator, I think that there's more than 
that. I think that the financial incentives, as they are 
structured, do not incentivize the right behavior.
    Senator Warren. Okay. So, you're saying you think both the 
contracts are bad, but--let's just start with--the enforcement 
part of this is also a problem, and that's a leadership 
problem. Is that right?
    Secretary Wilson. Yes.
    Senator Warren. Just want to make sure we're in the same 
place on this.
    Secretary Wilson. Leadership both on the military side and 
also the local leadership of the contractor.
    Senator Warren. Okay. But, it's leadership on the military 
side that enforces. It's not the contractor that enforces.
    Secretary Wilson. One of--enforcement, that is true, but we 
have--where--I would say that where we don't have problems at 
bases, local leadership and management quality really matter. 
That is the biggest indicator of quality housing, is a good 
local manager by the housing contractor.
    Senator Warren. Fair enough, Secretary Wilson, but I just 
really have to bear down on this point. If no one will enforce 
the rules, then--I understand exactly how incentives work, and 
the way incentives work is to improve your profits by not 
delivering the product that you promised to deliver. We've got 
to look at both of these, the leadership on how we get 
enforcement of the rules and whether the rules, themselves, are 
adequate, and I take it from what you've already said, we have 
a leadership problem, but we also have a problem on the rules. 
Correct, Secretary Esper?
    Secretary Esper. Yes, ma'am. I do want to make a good 
point, something the Chief reminded me of, because we need to 
be fair to the chain of command here, too. There was an 
instruction given by civilian leadership in the 2013ish or 
timeframe to say, ``You are not responsible, that you should 
not conduct inspections of the homes.'' And so, we've 
subsequently unwound that and are now giving different guidance 
to the chain of command, to be involved----
    Senator Warren. Okay, but who gave those orders? I mean, we 
can talk leadership. Let's just move up a little. Somebody----
    Secretary Esper. I think----
    Senator Warren.--issued those orders, and it didn't come 
from the contractor.
    Secretary Esper. An assistant secretary at the time did.
    Senator Warren. An assistant secretary of the----
    Secretary Esper. Of the Army.
    Senator Warren.--Department of----
    Secretary Esper. Of the Army.
    Senator Warren. The Army.
    Secretary Esper. Yes, ma'am.
    Senator Warren. Said, ``Don't enforce the contracts,'' in 
effect.
    Secretary Esper. No, no, said, ``Do not--you're not 
responsible for conducting inspections of the housing''----
    Senator Warren. But, who was going to enforce the contract?
    Secretary Esper. Well, I--we completely agree, Senator.
    Senator Warren. All right. Okay.
    There's the problem we've got. We need better rules, and we 
need better enforcement of those rules.
    I'm putting together a reform bill that will enhance 
oversight, protect tenants. I know we're working on a Tenant 
Bill of Rights here. You know, the Committee can put all of the 
right rules in place that it wants, but if the leadership 
doesn't enforce those rules, then, at the end of the day, we're 
not going to be delivering for our military personnel. 
Enforcement--not just signing the contract, but enforcing the 
contract is absolutely critical.
    I just want to dig down on one part of that and on some 
reports of potential fraud. The committee has received reports 
from military families who are being charged for things like 
carpet replacement, upon moving out, but the carpets are not 
actually replaced. Did the services conduct any inspections, 
when the houses are in between tenants, to make sure that the 
providers are actually completing the work that they're 
charging the military families for? Do we know the answer to 
that, Secretary Esper?
    Secretary Esper. I can't tell you right now, Senator, but 
I'll get you the answer.
    [The information referred to follows:]

    Secretary Esper and General Milley. The Army conducted 
limited inspections, but is now conducting inspection of 100 
percent of all homes having completed between occupancy 
maintenance to ensure families are moving into homes that have 
no outstanding maintenance issues. Families are not charged for 
maintenance work performed in Army owned or privatized homes, 
they are charged for damages beyond fair wear and tear during 
their occupancy.

    Secretary Esper. I've heard the same thing, and I think, 
going forward, one of the things I said earlier today is that 
we want to have 100 percent quality control on any transition, 
moving in or moving out, because----
    Senator Warren. Okay.
    Secretary Esper.--we've heard similar reports.
    Senator Warren. If someone's going to have to pay for it.
    Secretary Spencer, did you want to add to that?
    Secretary Spencer. It is technically, Senator, the housing 
office, the local housing office. Again, oversight, whether 
they do it or not, is now front and center.
    Senator Warren. Okay. So, they have the authority to do it, 
they're just not doing it.
    And, Secretary Wilson----
    Secretary Spencer. Exactly.
    Senator Warren.--did you want to add anything to that?
    Secretary Wilson. Senator, we do about a 10 percent 
sampling, so it is not a 100 percent look at the turnover time. 
I also would like to say that it--we take all indications----
    Senator Warren. I'm sorry, if you do 10 percent sampling, 
what have you found in your 10 percent sampling?
    Secretary Wilson. I'd have to get you the data----
    [The information referred to follows:]

    Secretary Wilson. Thank you for the question Senator 
Warren. Reviewing the data over the last year from all Air 
Force privatized locations, on average 9 of 63 locations (or 14 
percent) reported having homes that did not meet rent-ready 
standards when inspected. Additionally, 2 of 63 (or 1.5 
percent) reported late turnover of the homes. For those homes 
that were not rent ready, the Air Force Military Housing 
Offices engaged the project owners to address the issues. In 
January 2020, the Air Force will be progressing to a 100 
percent check of Change of Occupancy Maintenance using a much 
more comprehensive inspection regimen that looks at all major 
building systems. Additionally, the Air Force is working with 
the other Services and the project owners to include Change of 
Occupancy Maintenance Quality within the Performance Incentive 
Fee framework.

    Senator Warren. Okay. Whether this is a problem or not. 
Okay, and what kind of followup you do----
    Secretary Wilson. If there's----
    Senator Warren.--if you find out there's a problem.
    Secretary Wilson. Uh-huh. If there is an indication of 
fraud, we take that seriously and turn it over to the 
investigators for fraud.
    Senator Warren. Okay.
    I appreciate that. But, I'll just say it again. Until we 
get some real enforcement on these rules, we can write all the 
rules we want here in Congress, but we've got to rely on you 
folks to make sure they actually get enforced.
    Thank you.
    Thank you, Mr. Chairman.
    Chairman Inhofe. Thank you, Senator Warren.
    Senator McSally.
    Senator McSally. Thank you, Mr. Chairman.
    Senator Warren, this may one--be one of the few areas that 
you and I are in strong agreement with each other, and I look 
forward to working with you on it.
    Thanks for the leadership, all, for coming here today on 
this really important issue, and for the families who are 
represented here, some of which testified a few weeks ago.
    We've been talking a lot about landlords, but, honestly, 
based on hearing their harrowing stories, some of these sound 
like they're slum lords, not landlords. We've been talking a 
lot about the commander. I can't imagine being a commander and 
having someone in my unit whose family is dealing with these 
types of situations, where their kids are sick, they end up, 
you know, in a hotel, not knowing, day to day, where they're 
going to be sleeping the next night, with them and their 
children and their families, and the uncertainty and the lack 
of responsiveness, and the impact that that has, not just on 
the welfare of those individuals, but on the readiness of that 
unit and the ability for them to be able to do their 
warfighting mission. This is, ultimately, a commander 
responsibility.
    You mentioned, Secretary Esper, how some guidance in the 
past somehow moved in that direction. I think it's probably 
that way in most of the services. A few years ago, we had an 
incident with energy bills pop up at one of the bases in 
Arizona. When I started looking into it, I talked to the local 
commander, and there was this feeling of, like, ``That's 
between the tenants and the landlord, and that's a contract 
that they have.'' We've got to get away from this. I think we 
all agree that we've got to get away from this and we've got to 
move back into the commanders having responsibility, having the 
ability to enforce, having the ability to withhold payments and 
make sure that the health and the well-being of our members and 
their families are taken into account. It seems like right now 
the commanders, to varying degree, are either totally out of 
the loop at some bases or somehow involved slightly at some 
bases. So, it's very patchwork, it sounds like from the 
testimony today.
    I also am concerned, from some of the testimony from a few 
weeks ago, that we're hearing, even today, the first line of 
advocacy is the housing office. In many cases, these families 
testified the housing office felt--there was a feeling that 
they were kind of in cahoots with the contractors and there was 
no real accountability or oversight.
    Since this has been raised, has there been any looking at 
what's going on in the housing offices and holding individuals 
accountable that maybe had these issues brought to their 
attention for some of these families, but they did nothing or 
they weren't responsive? Do you have any cases of that in all 
of the reviews that have gone on in the last few months? Has 
anybody been held accountable in these housing offices? Because 
they're not their advocates, according to the families. Can I 
get an ``amen''?
    [A chorus of ``amen.'']
    Senator McSally. Yes, ma'am.
    Secretary Wilson. What we did find in the housing offices 
was insufficient numbers of people and insufficient support. 
Likewise, from the Civil Engineering Center, insufficient 
technical assistance from civil engineers when it's required. I 
think, with respect to your point on commander responsibility, 
you were absolutely spot-on, and a commander needs to be able 
to assess. That means they have to have access, and some 
commanders were being told by contractors that they couldn't 
bring in their environmental health folks and take a look at a 
home. That's unacceptable. They need to be able to direct that 
a repair is not sufficient. They need the adequate support in 
their housing offices and civil engineering squadrons. They 
need to be able to withhold payment, and they need to be able 
to impact the fees that are paid. If a commander has that kind 
of authority, I am pretty confident that they'll start to get 
responsiveness.
    Senator McSally. To follow up on that, Secretary Wilson, 
what do you need in order to allow them to have that authority? 
Does that take an act of Congress, or is that all happening at 
the service level?
    Secretary Wilson. I don't think we need an act of Congress 
for that. I do think we are going to have to change some of the 
contracts, and we may need a bit of backstopping from the 
Committee as we go through those negotiations.
    Senator McSally. Okay.
    Secretary Spencer----
    Secretary Spencer. I couldn't underscore that better. We 
need your backstop as we go into negotiations. With them 
knowing that you're behind us, I think we have a bully pulpit 
to start the negotiations with.
    Senator McSally. Thank you.
    Secretary Esper. I agree, as well, Senator.
    Senator McSally. Great. Thank you.
    The other issue that came up in the hearing was--and it's 
been mentioned a little bit today--is families having to have 
extraordinary out-of-pocket expenses, some related specifically 
to fixing their own problems that the private companies should 
have done, some related to medical bills. Are you also 
tracking, or is there a new mechanism for tracking, out-of-
pocket expenses of families and what mechanisms they need for 
them to be reimbursed from the failures of this?
    Secretary Esper. Senator, they should not be paying out-of-
pocket expenses for something that is the responsibility of the 
private contractor. I have heard those stories, as well. Again, 
it's reprehensible that that has happened. So, that's why, in 
the Bill of Rights, we've changed some things. For example, no 
longer will we accept nonrefundable pet fees, I think, is one 
thing. There are other fees out there, as well, we need to 
address and, likewise, in terms of, when somebody PCSs 
[permanent change of station] and they move in or move out of a 
house, having a third-party Army person there on the spot to 
arbitrate any issues so that they just don't arbitrarily keep 
their BAH, claiming that there's excessive damage to the home.
    Secretary Spencer. I wouldn't want to, Senator, hang all 
solutions on a new shiny object, but, in the leg that I was 
talking about, communications, whether it be an app, whether it 
be whatever, having a record of communications is stage one, 
so, one, we can track it, and, two, advocates and/or 
appropriate offices and people of responsibility are on record 
that this is an issue.
    Senator McSally. Okay, thank you.
    Secretary Wilson, anything to add?
    Secretary Wilson. No, Senator, I think my colleagues have 
covered those pretty well.
    Senator McSally. Okay, great.
    I am almost out of time, but I do want to just go back with 
a followup on my last statement of--I really think you guys 
need to look at the housing offices and the housing advocates, 
and what their role has or has not been, not just technical 
issues or manning. But, again, the stories and the testimonies 
we had for specific individuals in those cases--not everybody, 
but what's happened, even if they're undermanned, but them not 
playing their proper role and not actually being the advocate 
for the families. Thanks.
    Thanks, Mr. Chairman.
    Chairman Inhofe. Thank you, Senator McSally.
    Senator Blumenthal.
    Senator Blumenthal. Thank you, Mr. Chairman.
    I want to thank the Chairman and the Ranking Member for 
following up on this issue, and all of the military families 
who are here today.
    I want to thank General Milley for visiting with me 
yesterday and really giving me a very candid and determined 
view of the extent and magnitude and complexity of this issue. 
Like the panel today, he was reasoned and deliberate. But, I 
sensed, in his view, what I hope you share, which is a sense of 
outrage and anger that we've come to this point.
    Now, I'm just a country lawyer from Connecticut, but I was 
a prosecutor for a good part of my career. What I've seen about 
landlords and about others who may break the law is that they 
understand money, particularly withholding of money, and they 
understand prosecution. There have been references here to 
fraud. I think there are clear indications of fraud. I would be 
even more emphatic, given another setting. But, I would 
recommend that these issues be referred to the United States 
Department of Justice (DOJ) for investigation.
    [Applause.]
    Senator Blumenthal. What's happened here is criminal. It 
may not be criminal in the sense of provable beyond a 
reasonable doubt in a courtroom against a specific company or 
individual. I'll leave that to the Department of Justice. But, 
I would respectfully recommend that each of your services ask 
the Department of Justice to be involved in an immediate, 
intensive review of whether a criminal investigation is 
appropriate, or a civil investigation, because that's the 
enforcement that these landlords will understand. They are 
landlords. They may be slum lords, but they've counted on this 
cash cow. It is a risk-free cash cow. Very few landlords in the 
country have tenants who are obligated to pay, for decades--
literally decades--without any real accountability. That's been 
their situation up to the present.
    I'd like to ask each of the service secretaries who are 
here today, would you consider asking the United States 
Department of Justice to be involved?
    Secretary Esper. Senator, yes, sir, I think we should 
pursue any allegation of fraud, and hold people accountable if 
that's the case. We'll certainly take this back to our lawyers 
and make sure we approach it the right way, and aggressively.
    Secretary Spencer. Senator, we're already underway with 
Naval Audit. As you know, the way the system works, once Naval 
Audit has the data, then DOJ would be involved.
    Secretary Wilson. Senator, for the Air Force, it's the 
Office of Special Investigations (OSI) that does the initial 
investigation and then refers matters to the U.S. Attorney in 
the district where it's involved. We take allegations of fraud 
very seriously, and I'd be happy to talk to you about that 
more, privately.
    Senator Blumenthal. I'd be happy to talk to each of you 
privately, but let me just point out that the procedures for 
audit and internal investigation, in fact, take a lot of time. 
I would, again, very respectfully suggest that this procedure 
ought to be expedited, and, as a former United States Attorney, 
I can tell you, I would respect your going directly to main 
Justice with this issue, either the civil division or the 
criminal division. If we really care about this issue, let's 
recognize it for what it is and provide you with that backstop, 
because, at the end of the day, what they will respect across 
the table from you--and it won't be you, it will be people down 
the chain of command talking for you and representing you--but, 
what they will respect is the hammer of fair and effective law 
enforcement behind you. I think, if this problem had just 
arisen, if it were new or novel, maybe following the normal 
audit procedure would make sense. But, we're dealing here with 
a problem that has festered for a long time. I think that's 
been the overwhelming testimony here today, and I appreciate 
your being willing to talk to me, and perhaps others of the 
Committee, about an immediate referral to the Department of 
Justice. I say, I'm going to be formalizing that request in a 
letter that I hope to send you within the very near future.
    I want to ask about the health impacts. I heard from a 
woman, military family who lived in housing in New London at 
the sub base there from April 2014 to August 2018. She 
explained that the Balfour BD maintenance officer was 
responsive to some of her maintenance requests, like clogged 
drains. When she reported mold in their bathtub, they were 
advised, ``Just keep washing and cleaning the mold after every 
shower.'' Her youngest child caught pneumonia and, shortly 
afterwards, suffered a stroke, only a week before her first 
birthday. She acknowledges, she'll never be able to determine 
whether the stroke was caused by the mold in the apartment, but 
I'm asking now about the health of that, particularly on 
children, and whether you have been in touch with the VA 
[Department of Veterans Affairs], because some of these 
individuals may no longer be involved in active military 
service, to determine whether these environmental hazards and 
toxic substances encountered during military service can be 
compensable and treatable under the VA health system.
    I'll go down the line again, beginning with you, Mr.----
    Chairman Inhofe. Yeah, before we go down the line, we are 
going to adhere to our time limit, so I would deny that time 
and recognize Senator Tillis.
    Senator Blumenthal. I am sorry, Mr. Chairman. I'm happy to 
take those answers in writing and adhere to the time----
    Chairman Inhofe. Thank you, Senator----
    Senator Blumenthal. Thank you.
    Chairman Inhofe.--Blumenthal.
    [The information referred to follows:]

    Secretary Esper and General Milley. The Army is in regular 
contact with the Department of Veterans Affairs to share 
information on environmental hazards and toxic substances 
encountered during military service. This occurs via the 
monthly DOD/VA Deployment Health Working Group. The VA has 
historically determined that veterans who have been harmed by 
environmental hazards and toxic substances during military 
service are eligible for compensation and medical treatment by 
the VA.
    Secretary Spencer. Interagency coordination is important to 
ensure we address the needs of our current and former sailors 
and marines. As part of the Health Executive Committee, the 
Department of the Navy, in conjunction with DOD and the other 
Military Services, meets on a monthly basis with the Department 
of Veterans Affairs (VA) to address exposure-related topics. 
This work is done through the Deployment Health Work Group, 
which has both Navy and Marine subject matter experts engaged 
in this very important collaborative work. Medical conditions 
caused by exposure to toxic substances can be compensable and 
would be rated under the VA Schedule for Rating Disabilities.
    Secretary Wilson. The Air Force is in regular contact with 
the Department of Veterans Affairs to share information on 
environmental hazards and toxic substances encountered during 
military service. This occurs via the monthly DOD/VA Deployment 
Health Working Group. However, the Department of Veterans 
Affairs should be consulted for any questions about eligibility 
for compensation and health care benefits. There is a potential 
conflict of interest for Active Duty Air Force members 
directing VA compensation.
    General Neller. Interagency coordination is important to 
ensure we address the needs of our current and former sailors 
and marines. As part of the Health Executive Committee, the 
DON, in conjunction with DOD and the other Military Services, 
meets on a monthly basis with the Department of Veterans 
Affairs (VA) to address exposure-related topics. This work is 
done through the Deployment Health Work Group which has both 
Navy and Marine subject matter experts engaged in this very 
important collaborative work. Medical conditions caused by 
exposure to toxic substances can be compensable and would be 
rated under the VA Schedule for Rating Disabilities.

    Chairman Inhofe. Senator Tillis has--happens to be, in 
addition to a good Member of this Committee, the Chairman of 
the Personnel Subcommittee. So, he deals with these issues on a 
daily basis.
    Senator Tillis.
    Senator Tillis. Thank you, Mr. Chairman.
    Thank you all. We had a Judiciary Committee markup, and I 
had one other commitment; otherwise, I would have been here to 
hear your testimony. I'm only going to probably ask one 
question.
    I want to start, though, by thanking Secretary Esper. He 
was down at Fort Bragg. I was with them on Friday. We got an 
opportunity to visit two houses, the Bloods and the 
Blankenships, and we got to meet little Jason, a little 18-
month-old that's living in unacceptable housing conditions. We 
heard stories from a very empowered wife, Ms. Blood, who is 
standing up for other people who I think are a little bit 
intimidated and were afraid to come forward. I, frankly, 
believe that we've somehow drifted, with a program that started 
out well in 1996, worked well for a while, but now we're in the 
wrong place.
    I, for one, am not prepared to simply place blame on any 
link in the chain, though, because my guess is the housing 
providers are at fault, the command is at fault, the Department 
is at fault, and Congress is at fault for taking their eye off 
this ball.
    The one thing that I tell everybody when I get before a 
committee hearing, ``If you're in North Carolina and you're 
living in military housing that has unacceptable conditions, if 
you haven't gotten the right reaction from your command, call 
my office. It'll be casework, and I'll guarantee you it'll move 
to the top of the stack.''
    I also want to thank General Milley for coming in and 
talking about the plans, and Secretary Spencer, for the phone 
call that we had. I know I'll have discussions with all of you 
over time.
    But, we've got--and I'm not going to let go of this for the 
remaining Congress. We will have another oversight hearing, 
with the Chairman's blessing, to see where the progress is. I'm 
not talking about next year. I'm talking on fairly short 
intervals. Because if you look at this, this is not rocket 
science. We can fix this, and it starts by doing what every 
branch has said they're going to do. They're going to go out, 
knock on every door, and request permission to come in and see 
things that they think are unacceptable. Many of them will be 
okay. Some of them won't. All of them need to be identified.
    I do want to ask a question, and it's probably less of 
question, but more of a commitment from you all. It's been 
brought to my attention that some of the housing providers go 
to these young people--I mean, these are young--it may be the 
first lease they've ever signed. They go to these big 
organizations. Some of the ones are smaller, and these big 
organizations wave a nondisclosure agreement (NDA) in front of 
them and say, ``If you sign this nondisclosure agreement, there 
may be actually some sort of a bonus or a payment that you will 
be entitled to if you don't bring up what may be inadequate 
housing.'' That's at least how I read it. I don't know if y'all 
are aware of this, but here's what I'd like to find out if we 
can do immediately: rescind every damn one of these that have 
been signed, because it looks to me--and I don't mean to be 
cynical, but this is one--this is a practice by the housing 
providers. They'd better come up with a damn good reason for 
having somebody sign onto this. Because I've been a landlord 
before. It would have never occurred to me to say, ``I want you 
to sign away your right to say you're living in inadequate 
conditions.'' I don't know if that makes sense to any of y'all. 
I'm not going to ask you to go down the line, because, God 
forbid, you say it does. Because I can't imagine, on any level, 
why it would make sense to have a new tenant, these young kids, 
asked to sign this agreement, not understanding the 
implications of it.
    So, in my view, if any of these agreements are in force, I 
expect them to be rescinded over the next 30 days. Over the 
next 30 days, if they're not rescinded, I want to know what 
housing company wants to come before me and tell me why it 
makes sense. Tell me the business reason why it makes sense. 
Tell me the reason why it's for the good of the tenant. I'd 
love to have that conversation. We'll have it in an open 
hearing, we'll have it in my office. But, I'll guarantee you, 
this is has got to stop.
    Again, all of you have responded the way I would expect you 
to as the great leaders that you are. We have drifted. I can't 
imagine that any of you would have knowingly allowed the 
conditions that we've seen actually persist. But, now I expect 
every one of you to be on the tip of the spear to fix it. 
Everybody in command better be in touch with their folks that 
they've been entrusted to take care of. They better fix it, and 
they better applaud people who are coming forward in these 
communities and stepping up and being the ones that are saying, 
``This is wrong.'' This is not the way we treat our men and 
women in uniform. I know you all agree with this.
    But, this has got to be on short intervals. This isn't 
something we come back to next year and say, ``How have you 
done over the last year?'' We will have meetings in my office. 
We will have as many hearings as the Chair will allow me to 
have. I want to see, end to end, where are you making progress, 
and I want to see short-interval timelines.
    But, over the next 30 days, I want to see every damn one of 
these canceled, unless you want to walk into my office with the 
housing provider that thinks it's a good idea and build a case 
for me removing myself or changing that position.
    So, thank you all for being here.
    The last thing I would ask every member of the Senate to 
do. If you've got a military installation anywhere in your 
State, go visit them. I'm going to go knock on a few doors down 
at Camp Lejeune and down at Fort Bragg. I'm not going to do it 
announced. I'm going to knock on a door and--I'm going to do 
exactly what you guys are doing. I'm going to knock on the door 
and say, ``Can I come in and take a look around?'' It better be 
trending in the right direction. Because you all know I've got 
a history of supporting you. I've got a lot of confidence in 
every one of you. I know you can fix this problem. But, this 
has to be a top priority. The housing providers better make 
sure that unacceptable business practices--I don't know how to 
do your jobs, in terms of waging war, but I know how to run a 
business. This kind of business practice actually sets off a 
series of thoughts in my mind that make me wonder just how far 
these businesses have drifted, and we're going to find them. 
The ones that haven't addressed this before I find them, 
there's going to be a consequence.
    Thank you all for being here, and thank you for your 
commitment to taking care of our men and women in uniform.
    Chairman Inhofe. Thank you, Senator Tillis.
    Senator Hirono.
    Senator Hirono. Thank you very much, Mr. Chairman.
    I want to thank all of you for being here, because to have 
all of our services represented in this way emphasizes the 
importance of this issue and your commitment to resolving the 
problems.
    I do want to thank you, Secretary Esper, for coming to see 
me yesterday, and, Secretary Spencer, I'll be discussing with 
you some matters later on today. Thank you for your 
responsiveness.
    Now, as I sat here listening to all of you and the 
questions, it is really astounding that--some of the additional 
revelations. For example, I want to thank Senator Tillis for 
raising the issue of these nondisclosure contracts. Let's go 
down the line. Is this news to all of our secretaries?
    Secretary Esper?
    Secretary Esper. I think the first time I heard about it 
was in a meeting that Senator Tillis and I had with some 
spouses at Fort Bragg, and I don't understand it, and I've 
never heard of it before in my life. I've rented my share of 
apartments. So, we definitely got to dig into this. There's no 
reason why people should be signing NDAs.
    Senator Hirono. Secretary Spencer?
    Secretary Spencer. Exactly.
    Senator Hirono. News to you.
    Secretary Wilson.
    Secretary Wilson. Senator, in my visits to bases, I did not 
come across anyone who told me about one of those, but we're 
going to go back and check.
    Senator Hirono. Thank you. Because I think that is simply 
astonishing, that tenants would be forced to sign these kinds 
of documents. It may be one of the reasons that we hear from 
the tenants that there's a fear of reprisal if they even say 
anything. So, I would very much appreciate. I share Senator 
Tillis's concern about these kinds of so-called contracts.
    I do want to thank you, Secretary Wilson, for pointing out 
to us--and I was very taken with your acknowledgment of the 
loss of trust--the loss of trust of the airmen and--women that 
their housing concerns will be addressed and fixed. Is that a 
concern that is acknowledged by the other secretaries, the loss 
of trust of the servicemembers under your charge?
    Secretary Esper. Yes, ma'am.
    Secretary Spencer. Yes.
    Senator Hirono. So, I'll start with you, Secretary Wilson--
what would be the first thing that you would do that would 
directly go to your servicemember to tell them that you are 
going to listen to them and that you are going to fix their 
concerns relating to housing?
    Secretary Wilson. Senator, one of the things that the Chief 
and I are going to be doing over the next week, or possibly 2 
weeks, is to send out a clarifying guidance from us of what we 
expect from commanders and first-shirts all the way up through 
the chain of command, what their responsibilities and 
obligations are. I think you rebuild trust by doing what you 
say you're going to do and being responsive and holding people 
accountable. I don't think it's something that can be done with 
one communication or one----
    Senator Hirono. Yes, I realize that. This is why I ask, 
What is the----
    Secretary Wilson. Yeah.
    Senator Hirono.--first thing that you're going to 
communicate----
    Secretary Wilson. The first is----
    Senator Hirono.--to your service----
    Ms. Wilson.--the first is communication----
    Senator Hirono.--persons?
    Ms. Wilson.--directly to the chain of command on what we 
expect.
    Senator Hirono. What the chain of command gets, is that 
going to get to your servicemembers so that they know your 
chain of command is now going to have other expectations as to 
how they're--how they should behave?
    Secretary Wilson. Yes, ma'am, we will be broadcasting that 
very widely.
    Senator Hirono. Secretary Spencer?
    Secretary Spencer. Senator, right after the initial 
hearing, the CNO issued the NAVADMIN letter, which laid out 
exactly what we're doing, going forward. The Commandant wrote 
the white letter. This is part of our knocking on every door 
for a visit, to be completed by April 15, and there's a second 
avenue to that, and this is also the trust that's been lost 
with the Private Partner Venture provider. Now, the ball is in 
their court, but that is something that all us three service 
secretaries are coordinating through, not only the Bill of 
Rights, but through communication and education.
    Senator Hirono. Secretary Esper.
    Secretary Esper. Senator, it's a combination of 
communications, and we issued an execution order, if you will, 
within days of visiting Fort Meade, to talk about what our 
expectations are in the chain of command. We've sustained those 
communications. I think the visits by the leadership, both 
uniformed and civilian, are critical. But, now we've got to do 
the hard work of renegotiating contracts, implementing this 
bill of rights, and then have that sustained attention to this 
issue.
    Senator Hirono. If I were a tenant, the first thing that 
might impact me as to the seriousness that you all take the 
issue of housing would be a piece of paper that has the Bill of 
Rights as a Tenant. So, I want to ask you, when is the timing 
for the Bill of Rights which will be across all service?
    Secretary Spencer. The three of us took a first cut at the 
draft. You all are reviewing it now. We addressed that a little 
earlier, in that I would say, to manage expectation, probably 
90 days. You might ask, ``Why so long?'' We're going to sit 
down with the Private Public Venture partners to ensure we put 
the teeth in the agreement. In some cases, this might actually 
get bondholders involved, and third parties involved. So, I 
just want to manage expectations that it might take 90 days, up 
to.
    Senator Hirono. Sure, because we'd like to get it right. As 
you're formulating the Bill of Rights, though, are you 
contacting or are you--is a group like the Family Military 
Association Network, for example, are they being engaged in 
formulating--helping to formulate the Bill of Rights?
    Secretary Spencer. I don't exactly that organization. I 
know my office was reaching out to similar representatives of 
the military families living in houses.
    Senator Hirono. I think it would be very important to have 
the military families' voices be heard as you develop the 
Tenants Bill of Rights.
    There's been a lot of focus on the enforcement aspect of 
it, and I just want to reiterate how important that element is. 
I hope that you're going to put in place some very specific 
ways that enforcement will occur, and that your tenants will 
know what they need to do to kick off the kind of enforcement 
that we would expect from each of you.
    Secretary Esper, you noted--and I want to thank you, that 
you visited Schofield barracks. When was that?
    Secretary Esper. That was last summer, Senator.
    Senator Hirono. So, you talked specifically with them about 
their housing issues?
    Secretary Esper. I can't recall at the time whether we did. 
I think what you may be referencing is, earlier this last year, 
in October, we were at a family conference, the Chief of Staff 
and the Sergeant Major and I, and an issue came up about 
Schofield barracks with regard to a particular home at which we 
immediately dispatched a team to go look into the problem and 
remediate it.
    Senator Hirono. So, Secretary Wilson----
    Thank you. I think that, with all of this--the 
communications that will occur about housing, you're going to 
hear more about these issues as you visit the bases. I think 
it's really important for all the secretaries, in particular, 
to see firsthand.
    Secretary Wilson, you mentioned that, as you're developing 
a way for people to withhold their rents, but if the rents go 
directly to the housing agencies or entities, how are you going 
to fix that with regard to withholding of rent?
    Secretary Wilson. Senator, there's a couple of different 
ways that we're looking at it, and this is one of the things 
that gets into the implementation of the Bill of Rights. But, 
one of the ideas is an escrow account that's decided at the 
local level so that it's not a big administrative hassle to be 
able to get your rent back if you have reported a problem and 
it hasn't been taken care of.
    Senator Hirono. Okay. Thank you.
    Thank you, Mr. Chairman.
    Chairman Inhofe. Thank you, Senator.
    Let me make one last comment here. I want to be sure 
everyone understands, this isn't going to be the last hearing 
that we're going to have. Senator Reed and I have talked about 
this. In fact, the next one--we've had--we've already had with 
residents, we've had with government, but we haven't had a 
hearing with the contractors, and that would be next.
    So, for the purpose of this meeting, I'm going to ask 
Senator Tillis, the Chairman of the Personnel Subcommittee, to 
chair the remainder of the meeting.
    Senator Tillis.
    Now it goes to Shaheen.
    Senator Tillis [presiding]. Senator Shaheen.
    Senator Shaheen. Well, thank you, and thank you all for 
being here.
    I want to begin, first, to make sure I understood, because 
I came in in the middle of Senator Tillis's questioning, but he 
was suggesting that everybody go out and personally visit some 
of the housing on bases that are under your control. Is that an 
intent of everyone here, to do that?
    Secretary Esper. Yes, ma'am, it is. I've visited a few 
bases. The Chief of Staff has. The Vice Chief of Staff has. The 
Under Secretary has, and, of course, undergoing right now is a 
100 percent inspection of all of our housing units. It'll be 
complete in about another week and a half or so.
    Secretary Spencer. Same with Navy, Senator. I've been out 
to three of the Hampton Roads communities, Lejeune, Cherry 
Point. The rest of the offices also on the West Coast, down in 
the Gulf, we are out there visiting. I know the Commandant and 
the CNO are also underway.
    Senator Shaheen. You're doing 100 percent of all of the 
housing.
    Secretary Spencer. By April 15, yes, ma'am.
    Secretary Wilson. Senator, in my case, I personally went to 
Tinker, MacDill, and Shaw. The Chief went to Maxwell and 
Keesler. We also did a directed review of all military family 
housing that was finished by the 1st of March, and the initial 
results of that review are in the record.
    General Neller. Senator, if I could just clarify for the 
Marine Corps.
    Senator Shaheen. Please.
    General Neller. We can't invade the privacy of their 
property without their permission. So, what our commanders have 
been directed to do is to ask the member, both on and off base, 
if they lease their property, not a homeowner, if we can visit 
them. If they refuse, which is their prerogative, we would ask 
that we could interview them over the phone about the condition 
of their property. If they refuse that, then we'll try to 
provide information, like, ``Do you have these phone numbers? 
Here's the process. If you have an issue or if you've got a 
problem with your landlord, tell me what the problem is, we'll 
engage with the landlord.'' So, that's kind of where we are, 
and it's going to take some time, and just like everyone at the 
table, we've got members that live on other services' bases, 
because we do schools together, and we have education together, 
and we have joint bases together.
    It's going to take some time to scope this out, although I 
believe we all recognize, based on today in the hearing, that 
we've known there were problems, this is not--that we thought 
it was more isolated. I don't think we had an idea of the 
magnitude. We'll have to scope and scale that to get back to 
you in the next hearing.
    Admiral Richardson. Senator, just to give you a sense of 
that, we have a similar--a very similar program to the Marine 
Corps, as you would expect. To date, we've done--on our way to 
100 percent contact, we've--have 62,000 people contacted. Of 
those 62,000, about 900 have requested--agreed to have visits 
done to their homes, and those visits are in progress. So, that 
gives you a sense of the scale involved.
    Senator Shaheen. Thank you.
    I want to go back to a report that came out before many of 
you were in your positions. But, in 2015, the Pentagon's 
Inspector General conducted a series of military housing 
inspections to determine if facilities were in compliance with 
DOD. What that report found was that there were significant 
deficiencies in homes at five different bases, including 
dwellings that were built or renovated under the MHPI [Military 
Housing Privatization Initiative] program. Have any of you seen 
that Inspector General's report? Or are you aware of it? Is 
there anybody on the panel who has seen it and is aware of it?
    Secretary Spencer. I'm not aware of it, Senator.
    Secretary Esper. I've gone back and looked at a few 
reports. I don't know if I've seen that exact one, but there 
was a DOD one, and I think there was a GAO [Government 
Accountability Office] one. I've looked through three or four 
reports, Senator.
    Senator Shaheen. General Milley?
    General Milley. I'm aware of it. It came out in the summer 
of 2015. I became the chief in August. A couple of months 
afterwards, I looked through it and appropriate agencies within 
the Army have been working on it. We can give you a full status 
on it. Our Army IG tracked all of the actions and all the 
deficiencies, and they've been working on it for a while. It's 
clear it was not a good report. It was in the negative, and 
there's a lot of work yet to be done.
    I think Secretary Esper or Secretary Spencer, one of them, 
said this entire issue is the cumulative effect of a decade or 
almost 20 years of multiple problems. This is not going to be 
solved in 60 days, 90 days, a single Bill of Rights. This is 
going to be a concerted effort, multiple hearings over time. 
It's going to take a considerable level of effort by all of us 
at this table, the Congress, and all the chains of command and 
the contractors, to get after this thing. It's going to take a 
sustained level of effort.
    Senator Shaheen. I certainly appreciate that. I think 
everybody who's hearing about this issue understands that it's 
taken us a long time to get here, so it's going to take us a 
while to get out. I guess the question that I've got is, When 
we've got an IG report like that that raises the issue, it's 
then surprising to me to hear so many people who appear to be 
unaware of the extent of the problem. I'm just trying to figure 
out how we make sure that information from an IG report like 
this gets carried over from one generation of leaders to the 
next so that it continues to be addressed.
    You spoke to the fact that the Army is continuing to 
address what was in that report. Is that something that--again, 
if people are unaware of it, clearly you haven't done anything 
to address it. But, how do we make sure that this kind of a 
report gets shared and addressed as leadership changes?
    Secretary Wilson. Senator, in the case of the Air Force, we 
track all open IG recommendations monthly, and we have 
corrective action plans on every open IG recommendation. Our 
standard now in the Air Force is that there must be a 
corrective action plan for any DOD IG finding within 30 days, 
and that our objective is that 90 percent of them be closed 
within 12 months of the finding.
    We were aware of some systemic problems, particularly 
related to construction quality and a lot of the impact of 
water and moisture and mold and so on at four of our bases, 
that were very significant, and the construction on those 
continues.
    Secretary Spencer. Senator, same for Navy. While I said I 
was unaware of the study, we have the same tracking system, and 
if, in fact, they had not been remediated, they would have been 
flagged. That's why I said I wasn't aware of it. But, we didn't 
have any open issues in the system.
    Senator Shaheen. Well, I guess, again, that's why I'm 
puzzled. How do we flag this kind of an issue in the future so 
that it doesn't get to this point? I appreciated the 
opportunity to visit with you, Secretary Esper--I was struck 
with your comments about your concern that people in the 
military didn't feel like they could come to the military 
leadership and raise these concerns until it got so bad. I know 
that everybody's wrestling with this, but it seems to me we 
need to try and figure out how to make sure that it doesn't 
have to be a crisis or an article that appears in the newspaper 
before we're aware and begin to address it.
    Secretary Esper. Yes, Senator. I've met and spoken with 
spouses and soldiers. I think that's--maybe one of their 
biggest concerns is, what's the long-term, sustained effort to 
make sure that this doesn't fall off our radar screens? That's 
why, you know, we're all putting forward a number of ideas to 
make sure we have the systems in place, that the chain of 
command is in place, that we get the culture back to where it 
was, where we're checking in on soldiers and families, wherever 
they live.
    Senator Shaheen. Thank you.
    Thank you all very much.
    Secretary Spencer. I mean, Senator, if I might add, the 
Army has a best practice there, where they outsource lodging. 
You've done a terrific job in that regard, and the checks and 
balances and single points are there. So, we can pay attention 
from even models in our own system.
    Senator Shaheen. Thank you.
    Senator Tillis. Well, now that I've had a chance to count 
to ten, I'm going to be a little bit more--as we close out the 
hearing. First off, Senator Shaheen, I believe--I don't know if 
Secretary Wilson was able to answer your question about the 
inspection, but I think that the Air Force is also reaching out 
and making sure they're all given an opportunity. It's not that 
they're barging in every home. If someone says that they don't 
want their home inspected, then the presumption is, they're 
satisfied with it, and many of them are. To the point that 
Admiral Richardson made about the number of contacts versus the 
number of inspections, I would assume that they have a 
challenge that they want to look at.
    Admiral Richardson. We try and characterize them, also, 
Senator, as visits, really, not as formal----
    Senator Tillis. Inspections.
    Admiral Richardson.--inspections.
    Senator Tillis. Right. That's actually why I wanted to make 
sure that, you know, the families know they're not coming in 
for some sort of home inspection. But, I appreciate the 
outreach.
    But, it's just these mechanical things that drive me crazy. 
When you hear a--in one of the cases, when we were down at Fort 
Bragg, someone saying that they answer--they do this survey to 
figure out where they are, what the satisfaction level is. So, 
they have this annual event, ``Come in, maybe win a $500 
certificate.'' There's this pressure to have a positive 
predisposition. Why? Because these housing providers want a 
good score so that they get a bonus allocation. So, the 
negative sort of--the cynic in me says the only reason that you 
would ask somebody to sign on to a nondisclosure is, you want 
to juice the system so that you get a better review. Maybe I'm 
wrong. Happy to talk with a housing provider who thinks that 
that practice needs to stay in place.
    But, Secretary Esper and I, we were in this garage at the 
Blood's house. These are people that have been in this house 
for 4 years. They're near a range, so the ground shakes, nails 
are going to pop, general maintenance is going to occur. I 
understand all that. As long as the maintenance requests are 
fulfilled over a reasonable period of time. But, we went into 
the garage. Underneath--I don't know--it was the bathroom, I 
think, Secretary Esper----
    Secretary Esper. Yes, sir, it was underneath the--it was a 
bathroom leak.
    Senator Tillis. Yeah. So, I was the first one to crawl in 
and kind of look at the ceiling that had been--I used to 
drywall work when I was a teenager, and this thing was patched 
2 days before. It doesn't take 48 hours for even a thick patch 
of drywall to dry. It was wet. I went up there and stuck my 
finger in it, and then the Secretary did the same thing 
afterwards. What happens, here? Well, we've got this process, 
where the tenant calls and says, ``I've got what looks like to 
be a leak.'' The plumber comes, obviously didn't do their job, 
followed by the drywall people, who had to have known that the 
patch wasn't fixed. The drywall was wet. But, they did their 
job by patching the drywall. I'm sure that that drywall 
repairman reported, ``Pay me, because I did my job.'' But, that 
person should have had the authority to say, ``It's not right 
for me to do my job now, because the precursor to this work 
hasn't been solved.'' That's what I mean, in terms of the 
supply chain.
    General Milley, I agree----
    Secretary Esper. Senator, if--you know, just to kind of add 
more color to the story, because you recall this. What she told 
us, as well, is, you know, when she originally called the work 
order in, what they told her was, ``Just hang around your house 
for 3 days, and we'll come sometime during''----
    Senator Tillis. Right.
    Secretary Esper.--``the 3 days.''
    Senator Tillis. Right. So, we give you a window. You know, 
the norm now----
    Secretary Esper. A 72-hour window, while she has a job to 
go to.
    Senator Tillis. Right. I thought that Secretary Esper was 
dead-on. I mean, we should be treating this engagement with the 
tenants the way you engage an Uber driver. Just after the 
experience with the plumber, give them stars for whether or not 
they fixed the problem. With the drywall person--in other 
words, let that be the feedstock for determining whether or not 
these housing providers are doing their job and providing 
adequate service. That's the sort of modernization that we need 
to focus on.
    General Milley, I completely agree, it's going to take time 
for us to make sure that we have the operational pieces in 
place not to drift. I also--I believe that, as you all go 
through this process, some direction, either from this 
administration or past administrations, may have increased or 
decreased the priority on housing. Let's bring that to the 
fore. Any congressional action that caused a negative impact--
we're not going to find any one person responsible. We're all 
responsible, probably, and we're all going to be responsible 
for the fix.
    But, the one exception I would take--General Milley and I, 
I think, only have one exception, and it's favorite football 
team. That's the only thing I've found, over time, that I can't 
get him to turn around on. But, on this issue, I do take 
exception to the notion that this is going to take a long time 
to fix for those who are in unacceptable housing now. I don't 
think that's what you meant.
    So, there's two pieces. Number one, fix every single one of 
them now. I think some of these housing providers are hoping 
that the problem kind of goes away, because people get PCS'd, 
then they'll wait for the next person to raise the same issue 
again. So, let's separate the systemic--the operational changes 
that we need to make, that will take some time, from the 
immediate challenge to make sure every single person who's in 
unacceptable housing either gets it up to standard or gets them 
in another home.
    General Milley. Senator----
    Senator Tillis. I'll do----
    I'm sorry, General Milley.
    General Milley. That's correct, that--if it's life, health, 
safety, it's immediate. But, the systemic problems, of which 
there are many--the restructuring of these contracts, the 
incentive fees, going to the Department of Justice, all these 
other things that we're talking about--the structural issues, 
that's going to take a considerable length of time and a lot of 
gnashing back and forth between Congress and the Department and 
the contractors and lawyers and so on and so forth.
    But, the immediate life, health, safety, that's immediate, 
that's chain of command. We've got to be all over it. I 
believe, by the way, that the contractors that we've talked to, 
the seven contractors, I believe they're committed to those 
immediate fixes for life, health, safety.
    Senator Tillis. I do, too.
    Then, finally, again, this issue with the nondisclosure----
    General Goldfein. Sir, can I----
    Senator Tillis. General, go ahead.
    General Goldfein. Yes, sir. I wanted to just talk to that 
nondisclosure, a minute. Senator Cotton allowed us to speak 
directly to airmen. There's another group out there that I 
think we can't close this hearing without speaking directly to, 
and that's parents of airmen. As a parent of an airmen--you 
know, every Friday afternoon, we have 800 young men and women, 
greatest treasure in our Nation's arsenal, walk across the 
parade field of Lackland Air Force Base, and they become 
airmen. At the end of that ceremony, the parents rush out of 
the stands, and they entrust them to us. I don't--I'm--imagine 
there's a lot of parents of airmen who are listening to this 
hearing and (USAF) wondering whether the leadership of the 
United States Air Force is taking care of their airmen. Or 
future parents. I don't want to leave this hearing without 
looking at them in the eye and telling them that we own this, 
that we will take care of their children.
    Senator Tillis. I'm sure the thing could be said straight 
down the line.
    So, I want to work with you all. I am serious about it--
maybe it's not as--I want to--I also want to tamp down red 
herrings. If this nondisclosure practice no longer exists, this 
is just an artifact, that's great. If there is any one housing 
provider that thinks that they have a rational basis for not 
rescinding these nondisclosure agreements over the next 30 
days, I want to see them in my office.
    I want to get to these--what I think are big--these big 
rocks that we can turn over fairly quickly so that we can 
really size the problem and address the problem.
    Secretary Spencer. Then we'll close out.
    Secretary Spencer. Senator, I will tell you right now that, 
this afternoon, I will call all of our CEOs of the PPV. I have 
to believe they're probably watching this testimony right now. 
If they have any of these documents in their files, they're to 
be accounted for and we're going to talk about them this 
afternoon.
    Senator Tillis. Thank you, and again, if they think they 
have a rational basis for it, I want them to come in my office 
and explain it to me.
    Thank you all. I--you know, every single one of you, I've 
had the privilege to vote for and support in your current 
positions. I have the utmost confidence in you. I know that 
you're going to go after this. I know that it's complicated. 
And you should know that I will do everything I can to help you 
get to a good place as quickly as possible.
    With that, we will end the hearing. I think we will keep 
the record open for a week. I'll also pass it over to Senator 
Reed before we close out.
    Senator Reed. I just simply want to thank all the 
witnesses, not only for your testimony, but for your commitment 
to fix the immediate problems and then stay on target for 
months and months and months as we fix the systemic problems.
    Thank you.
    Senator Tillis. Again, thank you all. We will keep the 
record open for any questions for the record. Please know that 
my office is here to help you.
    Thank you.
    The meeting is adjourned.
    [Whereupon, at 12:06 p.m., the Committee adjourned.]

    [Questions for the record with answers supplied follow:]

                Questions Submitted by Senator Jack Reed
                            lessons learned
    1. Senator Reed. Secretary Esper, General Milley, Secretary 
Spencer, Admiral Richardson, General Neller, Secretary Wilson, and 
General Goldfein, given the number of housing problems we have seen, 
clearly these 50-year agreements need to be reopened and rewritten to 
have some teeth in them. I imagine each of you have already identified 
some lessons learned and specific areas in privatized housing that need 
significant improvement in these last few weeks. What are some specific 
fixes that you all will direct given your positions, and what are some 
recommended fixes that Congress can help implement in the NDAA 
[National Defense Authorization Act]?
    Secretary Esper and General Milley. The Army developed an Army 
Housing Campaign Plan to ensure effective policies and strategic 
direction are in place at every echelon of command. This plan sets the 
responsibilities for command oversight and program accountability at 
all Army installations. In addition, the Army has enhanced training 
programs at a number of senior leader courses, including Garrison Pre 
Command Course, Battalion/Brigade Pre Command Course, and General 
Officer senior Commander Course to ensure leaders understand their 
roles and responsibilities for soldier and family housing.
    Secretary Spencer and Admiral Richardson. The Department of the 
Navy (DON) has initiated numerous efforts to improve our oversight, 
assign accountability across the program, and provide our sailors, 
marines, and their families with the quality housing they deserve. 
Specifically, as of the date of this hearing, the DON has:

      Initiated a comprehensive review of all of our Public 
Private Venture (PPV) housing agreements;
      Met with the Naval Audit Service to discuss a 
comprehensive review of the PPV program;
      Directed unit level leadership make personal contact with 
every servicemember who lives in a privatized housing unit to 
personally observe any issues affecting the home and help resolve 
outstanding issues;
      Held more than 70 town halls at our installations to 
learn more about the conditions at each housing project and conducted 
an out-of-cycle resident satisfaction survey; and
      Established Privatized Housing Crisis Action Teams at 
installation and regional command headquarters to respond to 
complaints.
      Worked with PPVs to create a web/mobile application to 
provide ease and visibility into the maintenance request reporting, 
tracking, rating, and resolution process. We look forward to working 
with Congress to identify additional authorities that may aid in 
improving the experiences of our military families living in privatized 
housing.

    General Neller. The DON has initiated numerous efforts to improve 
our oversight, assign accountability across the program, and provide 
our sailors, marines, and their families with the quality housing they 
deserve. Specifically, as of the date of this hearing, the DON has:
      Initiated a comprehensive review of all of our Public 
Private Venture (PPV) housing agreements;
      Met with the Naval Audit Service to discuss a 
comprehensive review of the PPV program;
      Directed unit level leadership personal contact with 
every servicemember who lives in a privatized housing unit to 
personally observe any issues affecting the home and help resolve 
outstanding issues;
      Held more than 70 town halls at our installations to 
learn more about the conditions at each housing project and conducted 
an out-of-cycle resident satisfaction survey; and
      Established Privatized Housing Crisis Action Teams at 
installation and regional command headquarters to respond to 
complaints. We look forward to working with Congress to identify 
additional authorities that may aid in improving the experiences of our 
military families living in privatized housing.
    Secretary Wilson and General Goldfein. The Air Force has identified 
multiple areas for improvement and has already begun taking action on 
these programmatic initiatives. The improvement areas focus on: (1) 
empowering residents; (2) integrating leadership; (3) improving 
communication; (4) standardizing policy; and (5) improving oversight. 
Examples of the actions taken by the Air Force include: establishing a 
housing advocate position at each installation Housing Management 
Office; leading the working group to develop a Tri-Service Resident 
Bill of Rights; increasing the visibility of work order status to 
residents; renegotiating the metrics for performance incentive fees to 
provide installation commanders with a greater role in evaluating 
project performance; improving the oversight of life/health/safety 
related maintenance work; revising resident surveys to ensure they more 
accurately reflect the true concerns of residents; working with the 
Navy and Army to develop a common Tri-Service resident lease; and 
adjusting manpower and skill sets at installation housing offices to 
enhance Air Force oversight of project performance.
                               oversight
    2. Senator Reed. Secretary Esper, Secretary Spencer, and Secretary 
Wilson, how many people in each of your departments are dedicated to 
the oversight of the Military Housing Privatization Initialize (MHPI)?
    Secretary Esper. The Army has 234 housing professionals responsible 
for oversight of the Military Housing Privatization Initiative. 
Headquarters, Department of the Army has 13 authorizations at the 
Office of the Assistant Secretary of the Army Installations, Energy and 
Environment, and the Office of the Assistant Chief of Installation 
Management; while Installation Management Command (IMCOM) has 221 
Housing professionals at Headquarters IMCOM and at the Garrisons, 
including 114 new housing professionals. The intent is to fully staff 
all authorizations.
    Secretary Spencer. As of the date of this hearing, the DON has a 
total of 191 positions dedicated to MHPI oversight. For the Marine 
Corps, there are approximately 46 people dedicated to the oversight of 
MHPI, most of whom are at the region and installation levels. The 
Marine Corps also funds approximately 17 additional positions at Naval 
Facilities Engineering Command (NAVFAC) for their support and oversight 
of the business agreements. The Navy has 128 positions that support the 
MHPI program, 88 of these positions are at Commander, Navy 
Installations Command (CNIC) and are mostly at the installation level. 
The Navy funds an additional 40 positions at NAVFAC for additional 
support and oversight of the business agreements.
    Secretary Wilson. In addition to the Assistant Secretary of the Air 
Force for Installations, Environment and Energy and two members of his 
direct staff, the Air Force has 247 funded positions in our government 
Housing Management Offices and 13 positions at the Air Force Civil 
Engineer Center providing oversight of the Military Housing 
Privatization Initiative portfolio. The Air Force is adding manpower in 
fiscal year 2020 to add tenant advocate positions at the installations 
to address existing shortfalls, and adding manpower to support 100 
percent government inspection of change of occupancy and life/health/
safety work at all privatized housing sites.
                        environmental compliance
    3. Senator Reed. Secretary Esper, Secretary Spencer, and Secretary 
Wilson, private housing partners are required to comply with all 
applicable federal, state, and local laws and regulations related to 
environmental, health, and safety hazards. These terms are generally 
put forth in their agreements with the Department of Defense (DOD) when 
the MHPI project is established. What steps do each of you take to 
ensure compliance with all applicable environmental, health, and safety 
laws and regulations as it pertains to privatized housing?
    Secretary Esper. Residential Communities Initiative (RCI) project 
companies are required to adhere to all Federal, state, and local laws 
and regulations to address environmental hazards. The Army is ensuring 
garrisons inspect 100 percent of all homes where occupancy maintenance 
/ change of occupancy maintenance have been completed and inspect 100 
percent of all work / service orders relating to life/health/safety 
issues. The Army and the RCI project companies will continue to inform 
and educate soldiers and families about the health impacts of 
environmental hazards, the resources available, and the methods to 
report life/health/safety issues.
    Secretary Spencer. PPV partners' obligations to comply with 
applicable environmental, health, and safety laws and regulations are 
generally covered in the project ground leases, and may be augmented by 
Environmental Management Plans or other legal agreements. The DON 
ensures compliance with these obligations by requiring PPV partners to 
immediately notify the Installation Housing Office of any resident 
concern involving asbestos, carbon monoxide, lead based paint, radon, 
security, mold/water infiltration and pest infestation. PPV Partners 
then document and address such environment, health and safety issues in 
accordance with hazardous material management plans, emergency/urgent/
or routine maintenance service calls, and established action plans, 
including applicable laws and regulations. The Navy and the privatized 
housing partners will continue to inform and educate sailors, marines, 
and their families about the concerns and health impacts of 
environmental hazards, the resources available to tenants, and all of 
the available methods to report potential risks.
    Secretary Wilson. Air Force privatized housing project documents 
require project owners to maintain all homes to industry standards as 
detailed in approved operating plans and in compliance with all 
environmental, health, and safety laws and regulations. The Air Force 
has a comprehensive oversight program of Military Housing Privatization 
Initiative projects and several tools at its disposal if a project 
owner is not taking appropriate actions to comply with the transaction 
documents. The Air Force required project owners to employ third party 
code compliance review firms during the development phase of projects 
to ensure designs met all required codes.
    The Air Force employed Residential Construction Managers to inspect 
construction for compliance with codes and industry practice during the 
development phase. The Air Force performs checks on 10 percent of the 
project owner's completed work and change of occupancy maintenance. The 
Air Force is increasing these compliance checks to 100 percent of all 
life/health/safety work and 100 percent of all change of occupancy 
maintenance. Additionally the Air Force is working with project owners 
to revise Performance Incentive Fees to make them a more effective 
oversight tool. The Air Force is revising the structure of the 
Management Review Committees and incorporating security, legal, and 
medical input into these discussions.
                          satisfaction surveys
    4. Senator Reed. Secretary Esper, Secretary Spencer, and Secretary 
Wilson, what is the response rate for both military department-
administered and private housing partner-administered tenant 
satisfaction surveys?
    Secretary Esper. The completed Army-sponsored survey for 2018 
reported a response rate of 38.5 percent (30,241 respondents out of 
78,515 surveys sent). Response rates for the previous two years were 
38.2 percent and 39.8 percent. The Army is completing an analysis of 
the most recent survey, conducted in 2019. The RCI project companies 
administer additional surveys at each touch point--move-in, move-out, 
and at every maintenance service. These point-of-service surveys are 
administered via survey cards, independent third-party survey firms 
hired by the RCI project companies, or electronic survey's through the 
property management operations system. The response rates vary by, and 
are maintained, at the installation level.
    Secretary Spencer. The average response rate for the DON was over 
45 percent in 2018.
    Secretary Wilson. The only survey that is currently completed is 
the annual resident satisfaction survey that is administered by a third 
party with the project owners. The response rate for the annual 
resident satisfaction survey in 2018 was 48.3 percent. The response 
rate in 2017 was 46.4 percent.
                         lead-based paint (lbp)
    5. Senator Reed. Secretary Esper, what have been residents' 
response to the Army's efforts over the past six months to address 
concerns about lead-based paint (LBP) in family housing?
    Secretary Esper. The Army has not received a large amount of input 
from residents in response to our efforts over the past six months to 
redress concerns about lead-based paint (LBP) in family housing. Some 
feedback indicates that residents appreciate the rapid response to 
their concerns and are pleased with remediation efforts. Most families 
welcomed the Army's additional inspection of their homes by EPA-
certified staff as well as the sharing of the inspection results. The 
Army received a few negative responses on individual emails sent 
through the Chain-of-Command where a couple of partners did not confirm 
the visual findings with testing before they remediated areas 
identified by visual inspection. Additionally, some residents noted a 
lack of urgency in mitigating the areas identified during the visual 
inspections.

    6. Senator Reed. Secretary Esper, the Army recently conducted a 
``90 enhanced review'' of environmental hazards, to include LBP, but 
only surveyed 10 percent of homes with LBP. Of that 10 percent, the 
Army found one or more positive indicators of LBP in over 60 percent of 
those homes. How could you possibly characterize only a 10 percent 
sampling of homes as an ``enhanced'' review and what is the Army doing 
to ensure all problems are being addressed, given the 60 percent hit 
rate at just those 10 percent of homes?
    Secretary Esper. The visual assessments were a snapshot in time of 
existing conditions in the homes built prior to 1978 which we treat as 
containing some amount of LBP. USACE concluded the Army and the RCI 
project companies had procedures in place to manage hazards in the 
interior of the homes between occupants. Based on year built, 1978 or 
before, we considered all of the homes to contain LBP. The 10 percent 
inspection allowed us to confirm what we basically already knew. We 
improved our monitoring program to manage potential hazards by: 
ensuring environmental management plans are reviewed, approved, and 
followed at each installation; increased Army staff inspections of all 
homes to include the interior and exterior; monitored and ensured 
visual inspection findings are tested/mitigated; established a system 
for tracking inspections in Defense Occupational & Environmental Health 
Readiness System--Industrial Hygiene (DOEHRS-IH), and fostered an 
understanding of potential environmental hazards in housing through 
resident education as well as housing and garrison staff.
                         oversight and funding
    7. Senator Reed. Secretary Esper, Secretary Spencer, and Secretary 
Wilson, the Government Accountability Office (GAO) reported in March of 
2018 that routine maintenance is often not adequate due to low funding. 
What is each of the military departments' long-term strategy and 
approach to ensuring maintenance is being conducted?
    Secretary Esper. The Army is enhancing quality assurance and 
oversight of maintenance. The Army is reviewing maintenance and work 
order histories to validate long-range plans for forecasted maintenance 
work, and to assess and improve the quality of preventive maintenance. 
We are using the findings to assess the RCI projects Capital Repair and 
Replacement Plans and operating budgets to ensure the RCI project 
companies are planning and budgeting appropriately for maintenance.
    Secretary Spencer. As the DON transitioned from oversight and 
monitoring of initial privatized housing project development to long-
term project sustainment, we held annual meetings with all of the PPV 
partners to identify commonality in long-term sustainment financial 
modeling. We have since transitioned to annual sustainment meetings by 
project, culminating in a strategic planning document covering up to 
five years. Our projections for the next five years indicate there is 
sufficient funding available to accomplish our objectives. At the 
headquarters level, PPV partner leadership meets at least annually with 
CNIC, Marine Corps Installations Command (MCICOM), and NAVFAC to 
collaborate and address sustainment related concerns. In the field, we 
conduct annual condition assessment site visits and spot checks of 
maintenance during home visits. We plan to increase these spot checks 
and follow up with residents in the near-term to ensure adequate 
maintenance is being conducted.
    Secretary Wilson. Air Force privatized housing projects generally 
have adequate funding to address routine maintenance. Annual operating 
budgets identify funding levels for day-to-day maintenance and must be 
approved by the Air Force. Deficiencies in routine maintenance are 
normally not the result of inadequate operating funds for maintenance. 
However, long-term forecasting performed by the Air Force indicates 
that several projects are experiencing or will experience sustainment 
funding shortfalls, and several more projects are projected to have 
insufficient funds to perform large-scale reinvestment in the housing. 
The lack of adequate sustainment funding and reinvestment funding can 
create maintenance challenges.
    In addition to approving funding for day-to-day maintenance in 
annual operating budgets, the Air Force reviews and approves the 
project sustainment plans for maintenance and repair efforts that are 
beyond day-to-day maintenance.
    The Air Force also conducts annual short and long range financial 
forecasts and initiates restructure negotiations for projects that are 
anticipated to not have sufficient funding for 100 percent of 
operational needs, debt servicing and sustainment requirements and an 
acceptable level of reinvestment over the life of the project.
    In the long term the Air Force will need to restructure several of 
the projects to ensure sufficient sustainment and reinvestment. 
Additionally, the Air Force is increasing manpower at the installation 
Housing Management Offices to provide additional oversight of the 
maintenance function, to include 100 percent checks on all health and 
safety work and 100 percent inspection of all change of occupancy 
maintenance.
                               __________
           Questions Submitted by Senator Richard Blumenthal
            accountability for privatized housing companies
    8. Senator Blumenthal. Secretary Esper, Secretary Spencer, and 
Secretary Wilson, have you developed a Housing Action Plan with both 
immediate actions and long term initiatives? Please submit this plan 
for the record.
    Secretary Esper. The Army has developed a Housing Action Plan with 
actions completed to date, ongoing action items, and future actions. 
The Housing Action Plan was submitted into the record.
    Secretary Spencer. DON is actively working with OSD, Army and Air 
Force on initiatives including but not limited to common lease language 
and a resident bill of rights to create a more consistent privatized 
housing experience across the DOD. In addition, the DON is executing 
short- and long-term actions to increase oversight of PPV housing 
through routine boots-on-the-ground and resident follow-up, spot 
checks, continued town halls, education, increased leadership 
engagement, and continued communications with all stakeholders. 
Examples of specific Navy and Marine Corps efforts include:
      Navy is reviewing long-term manning strategies to 
increase oversight; revising governing Navy Instructions for housing 
oversight; developing a quality assurance plan for partner 
accountability; and increasing the number of Housing Service Center 
staff to ensure support for sailors in privatized housing.
      Marine Corps plans to conduct an independent out-of-cycle 
resident satisfaction survey this Fall; and Marine Corps housing 
representatives at the Headquarters level, along with our PPV partners, 
will visit each installation to update the housing staff on upcoming 
housing changes and performance expectations.
      Additionally, we are working with PPV partners to better 
address reporting, tracking, rating, and resolution, to include the 
integration of mobile technology that not only allows tenants to 
contact and track their service requests, but also provides Navy and 
Marine Corps leadership with real-time data about issues and trends.
    Secretary Wilson. The Air Force has developed an action plan to 
improve the Military Housing Privatization Initiative Program. The plan 
is attached for the record.
      
    
    
    
    
    9. Senator Blumenthal. Secretary Esper, Secretary Spencer, and 
Secretary Wilson, do you commit to holding town halls to solicit input 
and feedback from military families? Will you release a schedule of 
these town halls in advance to this committee and the public?
    Secretary Esper. The Army is committed to holding town halls to 
solicit input and feedback from families. The Garrison Commanders will 
host town halls quarterly with the RCI partners and installation 
housing support staff in attendance for support and participation. 
Notice of town halls occurs at the installation level. While we require 
holding these town halls, the pending town halls are not tracked at the 
HQDA level.
    Secretary Spencer. In February 2019, Navy and Marine Corps 
leadership directed installation commanding officers to contact 100 
percent of privatized housing residents informing them how to raise 
issues with their homes. As of July 19, 2019, Commanding Officers have 
conducted more than 70 town hall meetings to learn more about the 
conditions at each housing project and hear privatized housing 
residents' concerns first-hand. Town hall meetings are one of many on-
going efforts the Navy and Marine Corps are employing to solicit input 
and feedback on how to improve the privatized housing experience.
    Secretary Wilson. Installation commanders already routinely conduct 
town hall meetings with the privatized housing residents to solicit 
input and feedback. The frequency of town halls is determined by the 
installation commander based on need; therefore, there is no master 
calendar of town halls. To further improve resident feedback, the Air 
Force will be directing installations to stand up Resident Councils to 
increase the avenues for continued resident input and direct input to 
the chain of command.

    10. Senator Blumenthal. Secretary Esper, Secretary Spencer, and 
Secretary Wilson, do you agree that services should require independent 
monitoring of maintenance work orders, commission external air quality 
inspections, and use external companies to conduct satisfaction 
surveys? How will you enhance independent oversight of housing on 
military installations?
    Secretary Esper. The Army agrees that independent monitoring of 
maintenance work orders, the commission of external air quality 
inspections, and use of external companies to conduct satisfaction 
surveys should be used when feasible. The Army's privatized housing 
project companies are required to comply with all applicable federal 
and state laws and regulations, including those that regulate housing 
and response to environmental hazards. The U.S. Army Corps of Engineers 
conducts ground lease inspections, sampling of homes for inspection, 
and reviews environmental plans. The Army has established a tracking 
system for inspections in the Defense Occupational & Environmental 
Health Readiness System--Industrial Hygiene (DOEHRS-IH) with the Army 
Public Health Center. The Army has increased project reviews and 
development reviews at the HQDA level. Additionally, the Army has 
contracted with a financial audit team to conduct analysis on the RCI 
project companies. The Army has introduced enhanced quality assurance 
procedures to be conducted by Army housing specialists that includes 
increased inspections of maintenance occurring between occupants to 
ensure families moving into homes have no outstanding maintenance 
issues.
    Secretary Spencer. The DON agrees that independent monitoring of 
maintenance work orders may be an effective tool in certain 
circumstances. Air quality is one component of an indoor environmental 
quality assessment. In privatized housing, the PPV partners are 
required to investigate and resolve indoor environmental quality 
issues, including air quality. Resident satisfaction surveys have 
always been, and will continue to be, conducted by external companies.
    Secretary Wilson. The Air Force does agree and performs, encourages 
or requires these actions. Specifically the Air Force requires the 
government housing management offices to conduct 10 percent oversight 
of maintenance work orders and will increase this to 100 percent checks 
on all health and safety work and 100 percent inspection of all change 
of occupancy maintenance. Air Force policy requires air quality 
inspections in housing where requested by competent medical authority. 
Where air quality inspections are requested by competent medical 
authorities, the Air Force agrees these inspections should be completed 
by an external accredited testing firm. Last, the Air Force encourages 
the use of third party satisfaction surveys. Currently, the annual 
resident satisfaction survey is conducted by a third party surveyor. 
The Air Force is working with OSD to review the resident satisfaction 
survey to ensure the integrity of the process.
    The Air Force has identified multiple areas for improvement to 
enhance independent oversight of privatized housing and has already 
begun taking action on these programmatic initiatives. The improvement 
areas focus on: (1) empowering residents; (2) integrating leadership; 
(3) improving communication; (4) standardizing policy; and (5) 
improving oversight. Examples of the actions taken by the Air Force 
include: establishing a housing advocate at each installation Housing 
Management Office; leading the working group to develop a Tri-Service 
Resident Bill of Rights; increasing the visibility of work order status 
to residents; renegotiating the metrics for performance incentive fees 
to provide installation commanders with a greater role in evaluating 
project performance; improving the oversight of life/health/safety 
related maintenance work; revising the form of resident surveys to 
ensure they more accurately reflect the true concerns of residents; 
participating in the working group effort led by the Navy to develop a 
common Tri-Service resident lease; and adjusting manpower and skill 
sets at installation housing offices to enhance Air Force oversight of 
project performance.

    11. Senator Blumenthal. Secretary Esper, Secretary Spencer, and 
Secretary Wilson, what other accountability measures--outside the chain 
of command--should be employed?
    Secretary Esper. The Army has taken other accountability measures 
outside of the chain of command. We have increased inspections outside 
the chain of command with USACE conducting inspections of ground 
leases, sampling homes for inspection, and reviewing environmental 
plans. The Army has established a tracking system for inspections in 
Defense Occupational & Environmental Health Readiness System--
Industrial Hygiene (DOEHRS-IH) with the Army Public Health Center. The 
Army has increased project reviews and development reviews at the HQDA 
level. Additionally, the Army has contracted with a financial audit 
team to conduct analysis on the RCI project companies.
    Secretary Spencer. The DON is taking steps to improve our oversight 
of the privatized housing program, assign accountability, and provide 
our sailors, marines, and their families with the quality housing they 
deserve. To that end, as of the date of this hearing, the Department 
has:
      Initiated a comprehensive review of all of our privatized 
housing agreements.
      Directed the Naval Audit Service to perform a 
comprehensive review of the PPV program.
      Established Privatized Housing Crisis Action Teams at 
installation and regional command headquarters to respond to 
complaints.
      Directed an independent out-of-cycle resident 
satisfaction survey at all PPV locations.
      Established the Sustained Housing Improvements Program to 
continue to address long-term goals for program improvement.
    Secretary Wilson. The Air Force Inspector General's Office has 
engaged in reviews of privatized housing oversight, in addition to 
multiple targeted audits from the Air Force Audit Agency. Any matters 
that may involve alleged criminal conduct are referred to the 
appropriate office or agency for investigation. The Air Force is also 
working to provide residents with the following direct measures: (1) 
the Air Force is adding a resident advocate position in the government 
Housing Management Offices to provide advice, education, and support 
and to advocate on their behalf with landlords; (2) the Air Force is 
working with project owners and the other services to develop a dispute 
resolution process to give residents the right to have housing issues 
heard and resolved by a neutral third party; and (3) a toll-free help 
line has been established and widely advertised for residents to report 
their concerns with privatized housing. Messages to the toll-free help 
line are received by the Air Force Civil Engineer Center, coordinated 
for further action with the project owner, and tracked to satisfactory 
completion.

    12. Senator Blumenthal. Secretary Esper, Secretary Spencer, and 
Secretary Wilson, will you commit to publicly release the findings of 
your respective audits? When do you expect that these audits will be 
complete?
    Secretary Esper. The Army is committed to releasing the findings of 
our audits to the extent the report is publicly releasable. The audits 
will take place during fiscal year 2020. The Army expects the audit 
results to be available by fiscal year 2021.
    Secretary Spencer. The DON directed the Naval Audit Service to 
perform a comprehensive review of the DON PPV program. The DON is 
committed to improving transparency and will release the findings of 
our audits to the extent the auditing agency determines the report is 
publicly releasable.
    Secretary Wilson. The Air Force Inspector General's Office 
completed a comprehensive review of privatized housing oversight in 
April 2019. This report is pending release.

    13. Senator Blumenthal. Secretary Esper, Secretary Spencer, and 
Secretary Wilson, do you believe that some of these private contractors 
may have engaged in fraud? If fraudulent activity is uncovered, what 
action will you take?
    Secretary Esper. The Army has no information that any private 
contractor is currently engaging in fraudulent behavior. Between 2010 
and 2015, Pinnacle American Management Services, the property manager 
for four Army privatized housing projects (operating on Forts Belvoir, 
Benning, Irwin, Moffett Field, Camp Parks, the Presidio of Monterey / 
Ord Military Community, and the Naval Post Graduate School), was 
terminated by the respective project companies for multiple acts of 
fraud. An investigation by the Department of Justice resulted in 
Pinnacle AMS entering into a deferred criminal prosecution agreement 
and paying a $1.3 million fine. Pinnacle AMS also paid approximately 
$40 million in damages to the RCI project companies as compensation for 
its fraudulent behavior.
    Secretary Spencer. As of the date of this hearing. the DON is not 
aware of any fraud allegations against any of its PPV partners in 
connection with Navy or Marine Corps privatized housing. The DON will 
refer any potential fraudulent activity by its PPV partners in 
connection with Navy or Marine Corps housing to the Naval Criminal 
Investigative Service or Acquisition Integrity Office, as appropriate, 
for a determination of whether to refer such activities to the 
Department of Justice
    Secretary Wilson. The Air Force has ongoing investigations related 
to potential fraudulent activity. The Air Force takes allegations of 
fraud seriously and all allegations are referred to the appropriate 
office or agency for investigation. The Air Force does not comment on 
ongoing investigations. If fraudulent activity is uncovered, the Air 
Force will take the appropriate actions.

    14. Senator Blumenthal. Secretary Esper, Secretary Spencer, and 
Secretary Wilson, will you refer any evidence of fraud or other 
criminal activity to the Department of Justice?
    Secretary Esper. Yes. Any evidence of fraud or other criminal 
activity reported will be coordinated with the appropriate law 
enforcement and legal authority to include the Department of Justice.
    Secretary Spencer. The Department of the Navy will refer any 
potential fraudulent activity by its PPV partners in connection with 
Navy or Marine Corps housing to the Naval Criminal Investigative 
Service or Acquisition Integrity Office, as appropriate, for a 
determination of whether to refer such activities to the Department of 
Justice.
    Secretary Wilson. The Air Force has referred all allegations of 
fraud or criminal activity to the Air Force Office of Special 
Investigations. The Air Force Office of Special Investigation works 
closely with local law enforcement, the FBI, and the Department of 
Justice.

    15. Senator Blumenthal. Secretary Esper, Secretary Spencer, and 
Secretary Wilson, do you agree that military services should withhold 
BAH [basic allowance for housing] payments on behalf of servicemembers 
when maintenance issues are unresolved? Do you require statutory 
authority to implement this reform?
    Secretary Esper. The Army supports ensuring that military tenants 
can withhold their rent, consistent with applicable law, if a landlord 
is not providing housing that is safe and habitable. The Army does not 
see the need for legislation regarding rent withholding.
    Secretary Spencer. The DON supports ensuring that military tenants 
have the ability to withhold their rent, consistent with applicable 
law, if a landlord is not providing housing that is safe and habitable. 
Statutory authority and an operational agreement between services, 
PPVs, and PPV bondholders may be required to implement this reform.
    Secretary Wilson. As part of the ongoing effort to develop a 
Resident Bill of Rights and a common lease, the Air Force is working 
with the other Services and project owners to develop a dispute 
resolution process to give residents the right to have housing issues 
heard and resolved by a neutral third party. As part of that process, 
this may include the right to have rent payments segregated and not 
used by the property owner or property manager pending the outcome of 
the dispute resolution process. Resolution in favor of the resident may 
include a reduction in rent or an amount to be reimbursed or credited 
to the resident. The Air Force believes this reform can be achieved 
within existing statutory authorities.

    16. Senator Blumenthal. Secretary Esper, Secretary Spencer, and 
Secretary Wilson, will you commit to making public the contracts 
between privatized housing contractors and the Department of Defense?
    Secretary Esper. The Army is committed to releasing these contracts 
to the extent doing so is consistent with the Freedom of Information 
Act and the Privacy Act.
    Secretary Spencer. The DON commits to releasing these contracts to 
the extent that such release is consistent with the Freedom of 
Information Act.
    Secretary Wilson. The Air Force is not opposed to making public the 
agreements between the Air Force and the privatized housing project 
owners, subject to appropriate exemptions as may be applicable under 
law.

    17. Senator Blumenthal. Secretary Esper, Secretary Spencer, and 
Secretary Wilson, are there any current contracts you are considering 
renegotiating or have you issued any fines to private housing 
companies? If so, which companies have been fined?
    Secretary Esper. The Army is not currently considering 
renegotiating any housing privatization contracts, but is negotiating 
changes to the criteria used for determining incentive fee payments by 
housing privatization companies to their property managers. The Army 
has no authority to fine private housing companies.
    Secretary Spencer. The DON has initiated dialogue with the PPV 
partners to improve the property management incentive fee criteria, and 
we continue to discuss this issue at the monthly/bi-monthly partnership 
meetings. To date no business agreements have been amended or 
renegotiated. No fines have been issued to private housing companies.
    Secretary Wilson. The Air Force is negotiating for a change in the 
structure of the Performance Incentive Fee metrics with the project 
owners, to include more stringent performance requirements and greater 
commander influence. Additionally, when financially-strained projects 
come to the Air Force for restructure, the Air Force has used the 
opportunity to re-negotiate key financial terms--often resulting in 
reduced or delayed fees and profit to project owners--and will continue 
to do so with future restructures. While the transaction documents do 
not allow for the Air Force to issue fines, the Air Force has denied 
the payment of some Performance Incentive Fees when project owners have 
not met the required performance metrics.

    18. Senator Blumenthal. Secretary Esper, Secretary Spencer, and 
Secretary Wilson, will you commit to soliciting feedback and input from 
military families and Senate offices during the drafting process for 
the Tenant Bill of Rights?
    Secretary Esper. The Army remains committed to taking care of 
soldiers and families. A part of this commitment is to solicit input 
from soldiers and their families, which we are in the process of doing 
now with the Tenant Bill of Rights.
    Secretary Spencer. The DON welcomes feedback and input from all 
stakeholders as we work with OSD and the other military services to 
develop a resident bill of rights. The General Counsel of the Navy and 
his counterparts from OSD and the other military services plan to meet 
with Professional Staff Members and Counsel for the Senate Armed 
Services Committee, to capture feedback on the document. OSD will 
circulate a draft of the resident bill of rights to current privatized 
housing residents. Residents will have 30 days to provide feedback.
    Secretary Wilson. The Air Force has solicited feedback and input 
from the SASC and military families for the Tenant Bill of Rights. OSD 
solicited and has received input to the Tenant Bill of Rights from 
military residents.
                             health effects
    19. Senator Blumenthal. Secretary Esper, Secretary Spencer, and 
Secretary Wilson, how are you working with the Defense Health Agency 
(DHA) to address health and safety hazards in military housing?
    Secretary Esper. The Army's Office of the Surgeon General meets 
regularly with the Defense Health Agency and sister Services' public 
health organizations to synchronize the public health response to 
concerns regarding health and safety in military housing. This is done 
via a Housing and Health Integrated Product Team (IPT) chaired by the 
Office of the Deputy Assistant Secretary of Defense for Health 
Readiness Policy and Oversight.
    Secretary Spencer. The DON and the other military services have 
been working with OSD via a Housing and Health Integrated Product Team 
(IPT) to address health and safety risks in housing. OSD Sustainment, 
Facilities Management, has addressed overall management of housing 
resident concerns--whether housing functioning or safety and health 
hazards; OSD Readiness, Force Safety and Occupational Health, has 
addressed safety and health risk assessment procedures; and OSD Health 
Affairs, Health Readiness Policy and Oversight, has addressed public 
health guidance and clinical care guidelines for military families 
reporting health concerns to their health care provider. These efforts 
have resulted in a draft ``Managing Health and Safety Risk in Housing'' 
letter that OSD will issue in the near future.
    Secretary Wilson. The Air Force's Office of the Surgeon General 
meets regularly with the Defense Health Agency and sister Services' 
public health organizations to address and synchronize the health and 
safety hazards in military. This is done via a Housing and Health 
Integrated Product Team (IPT) chaired by the Office of the Deputy 
Assistant Secretary of Defense for Health Readiness Policy and 
Oversight.

    20. Senator Blumenthal. Secretary Esper, Secretary Spencer, and 
Secretary Wilson, do you think that TRICARE providers should be asking 
patients about the living conditions during the appointments--for 
example, asking military families whether there is mold in their home, 
or whether they live in a home built before 1978 that may contain 
asbestos?
    Secretary Esper. DOD healthcare providers should screen for 
preventive health and environmental exposures, as they are doing now. 
Health care providers are skilled at eliciting symptoms and determining 
the causes of illness. When signs and symptoms point to potential 
household environmental causes, then providers should pursue lines of 
questioning and testing to identify these causes in the home or 
elsewhere.
    Secretary Spencer. The DON is in the process of implementing a new 
(18 March 2019) policy for Military Treatment Facilities evaluating 
patients who attribute their health issues to housing-related 
environmental exposures. This new policy will give medical providers 
the ability to consult with public health experts who can now liaise 
with Housing Service Centers and further investigate the environmental 
conditions in particular homes.
    Secretary Wilson. DOD believes providers should screen for 
preventive health and environmental exposures, as they are doing now. 
Health care providers assess for symptoms and determine causes of 
illness. When signs and symptoms point to potential household 
environmental causes, providers pursue lines of questioning and testing 
to identify the source of the symptoms. If the healthcare provider 
determines there is justification to recommend a housing assessment, 
they will notify the patient and provide them with contact information 
for installation Preventive Medicine Services/Public Health 
Departments, who in turn notify the appropriate installation housing 
authority.

    21. Senator Blumenthal. Secretary Esper, Secretary Spencer, and 
Secretary Wilson, will you commit to creating a database of military 
members who lived in houses with known mold or lead paint problems? 
Will you consider legal action in civil court to ensure private 
companies are paying the health care costs incurred by living in 
substandard and unhealthy housing?
    Secretary Esper. In support of the Headquarters, Department of the 
Army Housing Campaign Plan, the U.S. Army Medical Command (MEDCOM) 
established a Housing Environmental Health Response Registry to address 
Army Family concerns about housing and related health issues, provide 
residents with additional information on housing environmental health 
hazards, assist them in seeking medical care for any housing-related 
illnesses or concerns, and allow MEDCOM to share its concerns with Army 
leadership. As of 21 June 2019, 183 households have enrolled in the 
registry with 84 households reporting hazards such as mold, lead, 
dampness, water quality, or other. Seventy four (74) households 
requested additional information and asked to speak to a public health 
representative from the Army Public Health Center. Of these, 72 have 
been contacted with 25 follow-ups completed to date. The Army will 
consider the option of affirmative litigation against private companies 
to recoup U.S. Army health care costs incurred because of substandard 
base housing; however, the ultimate decision rests with the Department 
of Justice, pursuant to 28 U.S.C. 516.
    Secretary Spencer. The DON and our PPV Partners maintain multiple 
databases (e.g., eMH, Yardi, Maximo, Realpage) that track residents and 
the trouble calls/maintenance performed in their homes. If mold or 
lead-based paint is identified, it is entered into these systems for 
tracking and resolution. Medical conditions for servicemembers and 
family members are documented in the medical treatment record. The DON 
is not currently considering legal action in civil court to ensure 
private companies are paying the health care costs incurred by living 
in substandard and unhealthy housing.
    Secretary Wilson. We currently have a database already in use. 
Information gathered from these calls is placed into the Defense 
Occupational and Environmental Readiness database. The Government 
cannot file a civil court action under a private lease on behalf of a 
tenant.

    22. Senator Blumenthal. Secretary Esper, Secretary Spencer, and 
Secretary Wilson, how will you share information with VA about medical 
conditions that could result from the exposure to environmental hazards 
in military housing?
    Secretary Esper. All housing related medical conditions are 
documented in a soldier's or beneficiary's electronic health record in 
accordance with appropriate diagnostic coding practices. Service 
Treatment Records for VA eligible beneficiaries are transferred from 
the Army to the VA along standard transition practices. The DOD/VA 
Deployment Health Working Group meets monthly and on an ad hoc basis to 
discuss issues that relate to servicemembers and veterans. 
Environmental exposures are frequent topics.
    Secretary Spencer. Interagency coordination is important to ensure 
we address the needs of our current and former sailors and marines. As 
part of the Health Executive Committee, the DON, in conjunction with 
DOD and the other Military Services, meets on a monthly basis with the 
Department of Veterans Affairs (VA) to address exposure-related topics. 
This work is done through the Deployment Health Work Group, which has 
both Navy and Marine subject matter experts engaged in this very 
important collaborative work. Medical conditions caused by exposure to 
toxic substances can be compensable and would be rated under the VA 
Schedule for Rating Disabilities.
    Secretary Wilson. All housing related medical conditions are 
documented in a beneficiary's electronic health record in accordance 
with appropriate diagnostic coding practices. Service Treatment Records 
for VA eligible beneficiaries are transferred from the Air Force to the 
VA along standard transition practices.
                               __________
             Questions Submitted by Senator Joe Manchin III
                       leadership accountability
    23. Senator Manchin. General Milley, Admiral Richardson, General 
Neller, and General Goldfein, the chain of command fills critical roles 
and responsibilities in ensuring the wellbeing of soldiers, sailors, 
marines, and airmen under their command. You all testified to the 
effect that there has clearly been a failure of leadership at some 
level resulting in the housing quality issues we are seeing. There has 
also been a significant failure in the leadership of the privatized 
housing contractors who bear legal responsibility through their 
contracts to provide the agreed upon product quality. To date, I have 
not heard of any military commander being relieved of command, any 
contractor being terminated from their company, or any contracts being 
rescinded. Has there been any individual or entity who has faced any 
repercussions to date over the delivery of a clearly substandard and 
dangerous product to our servicemembers?
    General Milley. We identified there is a lack of knowledge about 
housing issues and how to address these housing issues within the Army. 
There has also been a shortage of personnel trained to address these 
housing issues. We took measures to eliminate these deficiencies by 
improving training and certification plans for Garrison Commanders, DPW 
staff, and Army Housing staff. The Army incorporated into the Garrison 
Pre-Command course specific training in housing program oversight, 
quality assurance, legal documents, financial accounts, and development 
planning. The Army developed a chain-teaching program of these topics 
for commanders and command sergeants major currently in command. The 
Army is increasing the number of Quality Assurance and Quality Control 
personnel across its installations by 114 to increase its oversight of 
all housing maintenance. The Army is also currently updating the 
Portfolio Asset Management (PAM) handbook to further reinforce 
oversight responsibilities. The PAM is a detailed portfolio asset 
management Army publication, which includes detailed roles and 
responsibilities of the Army's RCI portfolio and asset management 
functions at each echelon. The ground lease and partnership agreements 
are the primary documents that our partnerships operate under and 
provide the Army with a means to compel action to resolve substandard 
performance issues. Collectively, they prescribe the process for the 
Army to compel the poorly performing property managers, developers, and 
general contractors, and they provide the process for removing an RCI 
privatized partner from their role as the partnership's managing 
member. If an RCI private company and its lender fails to adhere to 
material terms of the ground lease and do not take satisfactory steps 
to cure the company's non-compliance, the Army may terminate the ground 
lease and re-acquire ownership of the privatized housing located within 
the terminated leasehold.
    Admiral Richardson. The Navy has not relieved an Installations 
Commanding Officer due to the condition of privatized housing. We are 
educating leaders on how they can forcefully and effectively assist 
when established processes are not providing our servicemembers and 
their families with satisfactory results in PPV housing. Base officials 
leverage all available options to hold PPV partners accountable, 
including the adjustment of incentive fees, the authority to issue cure 
notices, and ultimately, the ability to replace the property management 
company if necessary.
    General Neller. Concerns raised by our residents has caused the 
Marine Corps to place greater emphasis on the quality of maintenance 
repairs, and greater responsiveness to residents concerns. Accordingly, 
the Marine Corps has augmented its staff through filling current 
vacancies faster and activating Operational Support Reservists. 
Additionally the Marine Corps has pushed for greater involvement at the 
Installation Commanding Officer level. It is also notable that in some 
cases partners have changed their staffing structures to include 
additional personnel positions dedicated to service, maintenance and 
oversight.
    General Goldfein. At Tinker AFB, Balfour Beatty Communities has 
terminated several employees in response to poor performance issues 
raised by the Air Force.

----------------------------------------------------------------------------------------------------------------
 
----------------------------------------------------------------------------------------------------------------
              Regional Property Manager                        Terminated                         22 Jun 16
----------------------------------------------------------------------------------------------------------------
                         Vice President                        Terminated                          6 Jul 16
----------------------------------------------------------------------------------------------------------------
               Work Order Administrator                        Terminated                         22 Jul 16
----------------------------------------------------------------------------------------------------------------
                 Maintenance Supervisor                        Terminated                          9 Aug 16
----------------------------------------------------------------------------------------------------------------
                      Community Manager                        Terminated                         27 Jul 17
----------------------------------------------------------------------------------------------------------------
                      Community Manager                        Terminated                          7 Sep 18
----------------------------------------------------------------------------------------------------------------
                 Maintenance Supervisor                        Terminated                          5 Oct 18
----------------------------------------------------------------------------------------------------------------
              Regional Property Manager                        Terminated                          3 Dec 18
----------------------------------------------------------------------------------------------------------------

    At Maxwell AFB, Hunt Communities replaced the management in 2016 in 
response to Air Force identified performance issues.
    At the US Air Force Academy, Hunt Communities terminated one 
employee and a criminal warrant was issued for a former Hunt employee 
over the embezzlement of funds from the project. The Hunt corporate 
entity repaid to the amount of the embezzled funds back to the project. 
The activity was identified through Hunt's routine oversight audits.
    The Project Manager for AMC West (which includes Tinker AFB, Travis 
AFB and Fairchild AFB) was replaced in 2017 at the direction of the Air 
Force in part due to concerns with management of this project.

    24. Senator Manchin. Secretary Esper, Secretary Spencer, and 
Secretary Wilson, your testimony highlighted a previous lack of 
engagement with the housing companies as a direct contributor to the 
problems we are seeing today. How are you now directing your respective 
services to engage with the companies that manage base housing 
contracts?
    Secretary Esper. We now have a Board of Directors meeting with the 
Military Housing Privatization Initiative (MHPI) partner CEOs 
quarterly. HQDA hosts a MHPI partner working group meeting quarterly. 
The Army's Senior Leaders are conducting monthly meetings with the all 
RCI project companies. Garrison Commanders are meeting with their 
installation RCI project companies regularly. Garrison Commanders are 
hosting quarterly town halls with their residents and the RCI project 
company in attendance. The installation Army Housing Staff meet with 
the RCI project company routinely to discuss findings of inspections; 
assess the timeliness, quantity, and quality of work orders; review 
reports of life, health, or safety concerns; and collaborate to ensure 
all reported problems and issues are heard and resolved.
    Secretary Spencer. At the Secretariat level, DOD and the Service 
Secretaries are meeting quarterly with the privatized housing company 
executives to work on strategic initiatives including a resident bill 
of rights, common lease terms, potential changes to incentive fee 
criteria, improvements to government oversight, improvements to the 
frequency and quality of partner reporting of key metrics, and 
partners' use of mobile phone applications for reporting/tracking work 
orders. In addition, Navy and Marine Corps senior leadership have been 
actively engaged in monthly DON/PPV Partner meetings. The Navy and 
Marine Corps has notified its PPV partners of its intent to update the 
requirements and training for Installation Commanding Officers, to 
include required increased engagement with the PPV partners. PPV 
partners are sharing additional performance metrics with installations 
and regions to improve communications and streamline issue resolution. 
Increased quality assurance home visits and resident follow-up will all 
lead to greater coordination between PPV partners, housing office, and 
installation leadership. The Navy and Marine Corps will continue annual 
meetings with PPV Partner Senior Management, the frequency of which may 
increase to foster greater communications.
    Secretary Wilson. Secretary Wilson, Gen Goldfein, and Chief Wright 
will send a letter to all command teams emphasizing the importance of 
installation leadership being engaged with privatized housing matters. 
The Assistant Secretary of Air Force for Installations, Environment and 
Energy provides routine updates to Major Command Commanders on progress 
toward improvements and changes regarding Military Housing 
Privatization Initiative oversight and management and their respective 
roles. The Air Force Civil Engineer Center continues to provide a two-
hour introductory housing brief to all incoming installation 
leadership. Additionally, the Air Force has made progress in re-
negotiating the Performance Incentive Fee metrics to provide for 
increased commander input, and is revising the quarterly Management 
Review Committee meetings and the annual site visits to provide 
additional engagement amongst project owners, the government Housing 
Management Office, installation leadership and the Air Force Civil 
Engineer Center.
                          financial accounting
    25. Senator Manchin. Secretary Esper, Secretary Spencer, and 
Secretary Wilson, it has been reported that over the last two decades, 
the Department of Defense has contributed approximately $3.4 billion in 
funds for renovation and construction projects in partnership with 
private housing contractors. Government Accountability Office (GAO) 
report 18-218, ``Military Housing Privatization,'' details the 
diversity in project structures and the associated differences in 
reporting standards on finances, project status, and project health. 
The GAO report states that the data provided is ``not comparable'' due 
to these varying standards. How are you working with each other and the 
Assistant Secretary of Defense for Energy, Installations, and 
Environment (ASD (EI&E)) to ensure accountability for these funds and 
to verify that they are being used in a priority consistent with DOD 
objectives?
    Secretary Esper. The Army is exploring options to develop a 
Privatized Housing Index (PHI) system with specific goals for the 
portfolio and for individual projects. The level of work needed in the 
future is estimated based on the age of the unit in year 25 and the 
work completed during the initial development period. The Army has 
long-term sustainment plans which includes a capital repair and 
replacement plan and a reinvestment plan. These plans provide details 
on the future development and investment required to maintain and 
improve housing over the long-term. The plans are also reviewed and 
analyzed by a third-party company to monitor project health, finances, 
and development status to ensure accountability of funds and 
consistency with DOD objectives.
    Secretary Spencer. The DON works closely with OSD in preparing 
required annual reports on finances, project status, and project 
health. Additionally, our business agreements require annual financial 
audits by an independent third party. NAVFAC reviews the audit reports 
to ensure accountability of these funds. The DON has the right to 
approve annual operating budgets in the business agreements, which 
provides appropriate visibility to ensure alignment with DOD 
Objectives.
    Secretary Wilson. The Air Force approved the development plans, 
required the use of third party construction code compliance, and 
utilized resident construction managers hired by the Air Force to 
oversee the construction and ensure that it met the requirements in the 
project documents.
    As part of ongoing oversight and to ensure funds are used in a 
priority consistent with our objectives, the Air Force approves annual 
operating budgets, sustainment plans, and all reinvestment projects. 
The Air Force also requires annual financial audits and reports which 
are provided to the Assistant Secretary of the Air Force for 
Installations.
                            quality control
    26. Senator Manchin. General Milley, Admiral Richardson, General 
Neller, and General Goldfein, based on you testimony and available 
resources, it appears that inspections of military family housing is 
done primarily through the private companies that manage the housing 
and supplemented by spot checks by the services at varying levels and 
frequencies based on service policy. The state of some of the military 
family housing shows that this existing inspection process is not 
functioning as an effective quality control measure. Have your services 
considered or pursued independent third party inspection services to 
provide regular and unbiased inspections, opinions and customer 
satisfaction survey results to both the private companies as well as 
the service offices responsible for housing management?
    General Milley. The Army hired additional staff to conduct pre-
move-in/post departure home inspections. We currently use an 
independent third-party company to assess resident satisfaction in 
government-owned and privatized housing.
    Admiral Richardson. Navy directed an additional Resident 
Satisfaction Survey, managed and conducted by an independent third 
party, with added questions to ensure we are fully capturing resident 
concerns. In addition, in fiscal year 2020 the Navy is looking at 
hiring approximately 50 new home inspectors at installation Housing 
Service Centers to perform government inspections of privatized 
housing.
    General Neller. Currently, the PPV partner already utilizes an 
independent contract to conduct resident satisfaction surveys, and the 
Marine Corps is doing the same for the out of cycle survey targeted for 
the Fall. As part of the contract, the independent third party is 
required to develop improvement plans for locations that have low 
ratings based on resident feedback received. Additionally, when 
resident concerns warrant, audits are conducted to determine if a 
residents concerns are warranted. Independent audits are currently 
being conducted by GAO and NAVAUDSVC on the responsiveness to 
maintenance requests. The Marine Corps also proactively had a third 
party investigate the Resident Energy Conservation Program as a result 
of concerns expressed by resident at MCB Camp Pendlton.
    General Goldfein. Part of the Air Force's corrective actions 
include increasing manpower at the installation Housing Management 
Offices to allow for 100 percent inspection of change of occupancy 
maintenance and emergency life, health and safety work orders, 30 
percent inspection of urgent work order requests and 10 percent 
inspection of routine work order requests. The inspections would be 
completed by a combination of skilled government inspectors and third 
party inspection service providers.
    Customer satisfaction surveys are provided by third parties and the 
Air Force is engaged with project owners to ensure impartiality to the 
survey process.
                               __________
             Questions Submitted by Senator Tammy Duckworth
   tracking and addressing long-term exposure to harmful contaminants
    27. Senator Duckworth. Secretary Esper, General Milley, Secretary 
Spencer, Admiral Richardson, General Neller, Secretary Wilson, and 
General Goldfein, one of my major concerns with today's topic is that 
even if we succeed in fixing the urgent problems tomorrow, our military 
families--particularly their children--will be struggling with the 
harmful health impacts for months, years and in the worst cases, a 
lifetime. In fact, some symptoms may not even appear until later on in 
life. I am interested in how each Service is planning to track and 
address the long-term effects of exposure to lead-based paint, lead-
contaminated water, toxic mold and mildew and other harmful 
contaminants. What role should the Defense Health Agency (DHA) play in 
tracking the population of servicemembers and family members who have 
been exposed to lead and mold in military housing?
    Secretary Esper and General Milley. Healthcare providers will 
conduct Blood Lead Level (BLL) testing if a child is assessed to be at 
an increased risk of exposure to lead hazards at well-child 
examinations and annotate the risk assessment and BLL testing results 
in the patient's electronic health record. Healthcare providers will 
continue to monitor the health status of all children with confirmed 
elevated pediatric BLLs per American Academy of Pediatrics clinical 
practice guidelines. Healthcare providers will document patient 
symptoms that are consistent with an increased likelihood of exposure 
to mold and for whom a home assessment may be beneficial in the 
patient's medical record. If the healthcare provider determines there 
is justification to recommend a housing assessment, they will notify 
the patient of this determination and provide them with contact 
information for installation Preventive Medicine Services/Public Health 
Department who is subsequently responsible for notifying the 
appropriate installation housing authority of this recommendation Data 
gathered as part of the Army's Housing Environmental Health Response 
Registry and other housing related environmental health hazard 
assessments are also being stored in the Defense Occupational and 
Environmental Health Readiness System (DOEHRS). DOEHRS is the DOD's 
system of record for managing occupational and environmental health 
risk data. This data will be used to populate the Integrated 
Longitudinal Exposure Record (ILER) to fulfill the requirements of DOD 
Instruction 6055.20, Assessment of Significant Long-Term Health Risks 
from Past Environmental Exposures on Military Installations. The DHA 
should, at a minimum, be tasked to oversee the implementation of this 
Instruction.
    Secretary Spencer. Medical conditions, to include housing-related 
environmental exposure concerns for servicemembers and family members, 
are documented in the medical treatment record. Families can obtain 
copies of these records to take with them when they transition. The DHA 
should ensure documentation of medical conditions in the medical 
treatment record, and in coordination with the military Services and 
DOD, work to make privatized housing environmental health assessment 
data available to government housing officials, public health 
specialists, and healthcare providers.
    Admiral Richardson. Medical conditions, to include housing-related 
environmental exposure concerns for servicemembers and family members, 
are documented in the medical treatment record. Families can obtain 
copies of these records to take with them when they transition. The DHA 
should ensure documentation of medical conditions in the medical 
treatment record, and in coordination with the military Services and 
DOD, work to make privatized housing environmental health assessment 
data available to government housing officials, public health 
specialists, and healthcare providers.
    General Neller. Medical conditions, to include housing-related 
environmental exposure concerns for servicemembers and family members, 
are documented in the medical treatment record. Families can obtain 
copies of these records to take with them when they transition. The DHA 
should ensure documentation of medical conditions in the medical 
treatment record, and in coordination with the military Services and 
DOD, work to make privatized housing environmental health assessment 
data available to government housing officials, public health 
specialists, and healthcare providers.
    Secretary Wilson and General Goldfein. Speaking for the Air Force 
Medical Service, military members and their family members who have 
confirmed exposure to lead will have their blood lead levels documented 
in their electronic health record and if elevated, will be tracked to 
ensure the source of the exposure is mitigated and further monitoring 
will be done until the risk is abated. Residents who are asymptomatic 
or symptomatic with visible mold in military housing, will receive 
service to remove the mold and these records will be maintained by the 
privatized housing contractor. Residents who are symptomatic will 
receive diagnosis and treatment as needed, either via the local Medical 
Treatment Facility or by a TRICARE provider. These individuals will be 
tracked using our electronic health record system until their symptoms 
have resolved.

    28. Senator Duckworth. Secretary Esper, General Milley, Secretary 
Spencer, Admiral Richardson, General Neller, Secretary Wilson, and 
General Goldfein, would your Services support Congress amending the law 
to authorize TRICARE benefits for former active duty family members who 
receive diagnoses for illnesses that may stem from sustained exposure 
to subpar housing conditions that occurred many years ago?
    Secretary Esper and General Milley. The Defense Health Agency (DHA) 
administers all aspects of the TRICARE program, to include managing its 
budgeting and funding requirements. As such, it would be most 
appropriate for DHA to address this question as the prospective law 
would have direct impact on its operations.
    Secretary Spencer. Former active duty servicemembers found to have 
substantiated illness due to military service, including sustained 
exposure to environmental health hazards in military housing, should 
receive appropriate medical treatment. Presently, both TRICARE and the 
VA provide these medical benefits.
    Admiral Richardson. Former active duty servicemembers found to have 
substantiated illness due to military service, including sustained 
exposure to environmental health hazards in military housing, should 
receive appropriate medical treatment. Presently, both TRICARE and the 
VA provide these medical benefits.
    General Neller. Former active duty servicemembers found to have 
substantiated illness due to military service, including sustained 
exposure to environmental health hazards in military housing, should 
receive appropriate medical treatment. Both TRICARE and the VA provide 
these medical benefits.
    Secretary Wilson and General Goldfein. DOD is committed to ensuring 
the health and safety of our Service Members and their families. As 
validated evidence linking household exposures to illnesses becomes 
known, DOD supports legislation that ensures our men and women of the 
Armed Forces and their families receive appropriate and necessary care.

    29. Senator Duckworth. Secretary Esper, General Milley, Secretary 
Spencer, Admiral Richardson, General Neller, Secretary Wilson, and 
General Goldfein, since there will be an increase in respiratory 
illnesses among servicemembers returning from Iraq and Afghanistan, how 
would the DHA differentiate the cause of these illnesses among the 
military population, to include health problems that may actually 
originate with prolonged exposure to dangerous military privatized 
housing units?
    Secretary Esper and General Milley. Differentiating the cause of 
illness for a particular servicemember can be a challenge, especially 
when multiple exposures may be involved. The integration of various 
data sources--deployment health history, occupational and environmental 
health surveys (workplace and residences, as appropriate), as well as 
electronic health records, enables our providers to understand where 
the potential sources of exposure may be linked to symptoms or to 
illness. By working with public health professionals, symptoms linked 
with exposures will be documented in our electronic health record and 
followed appropriately.
    Secretary Spencer. Differentiating the cause of illness for a 
particular servicemember can be a challenge, especially when multiple 
exposures from various environments, including occupational, 
recreational, and residential, experienced throughout a military career 
may be involved. The integration of the various data sources--
deployment health history, occupational and environmental health 
surveys, as well as electronic health records--enables providers to 
understand where the potential sources of exposure may be linked to 
symptoms or illness. By working with Public Health professionals, 
symptoms that are causally linked to exposures will be documented in 
the electronic health record and followed appropriately.
    Admiral Richardson. Differentiating the cause of illness for a 
particular servicemember can be a challenge, especially when multiple 
exposures from various environments, including occupational, 
recreational, and residential, experienced throughout a military career 
may be involved. The integration of the various data sources--
deployment health history, occupational and environmental health 
surveys, as well as electronic health records--enables providers to 
understand where the potential sources of exposure may be linked to 
symptoms or illness. By working with Public Health professionals, 
symptoms that are causally linked to exposures will be documented in 
the electronic health record and followed appropriately.
    General Neller. Differentiating the cause of illness for a 
particular servicemember can be a challenge, especially when multiple 
exposures from various environments, including occupational, 
recreational, and residential, experienced throughout a military career 
may be involved. The integration of the various data sources--
deployment health history, occupational and environmental health 
surveys, as well as electronic health records--enables providers to 
understand where the potential sources of exposure may be linked to 
symptoms or illness. By working with Public Health professionals, 
symptoms that are causally linked to exposures will be documented in 
the electronic health record and followed appropriately.
    Secretary Wilson and General Goldfein. Speaking for the Air Force 
Medical Service, differentiating the cause of illness for a particular 
servicemember can be a challenge, especially when multiple exposures, 
both on and off duty/occupationally or recreationally-related, may be 
involved. The Service Medical Departments would be the appropriate 
place to differentiate the cause of these illnesses with support from 
the DHA since these conditions could affect fitness for duty. The 
integration of various data sources including deployment health 
history, occupational and environmental health surveys, as well as 
electronic health records, helps our healthcare providers better 
understand whether the potential sources of exposure may be linked to 
symptoms or to illness. By working with Public Health/Epidemiology 
professionals and staying in touch with the most current applied 
research, medical providers may have a better understanding of how 
exposures and symptoms may be connected and then document that possible 
cause in the member's electronic health record.
                    replacing all lead service lines
    30. Senator Duckworth. Secretary Esper, General Milley, Secretary 
Spencer, Admiral Richardson, General Neller, Secretary Wilson, and 
General Goldfein, as Ranking Member of the Subcommittee that oversees 
the Safe Drinking Water Act, I am convinced that our Nation is missing 
an incredible opportunity to create jobs, bolster our economy and most 
importantly, protect children from permanent brain damage by fully 
replacing all lead service lines throughout the country. This is not 
some pie-in-the-sky dream. American cities with both the means, and the 
will, have achieved this goal. For example, the City of Madison 
Wisconsin invested nearly $20 million over a decade to replace its lead 
service lines. Thus, do you believe that the benefits resulting from 
full lead service line replacement of the entire defense housing 
portfolio would enhance readiness by lowering incidents of lead 
poisoning and providing servicemembers with peace of mind that their 
families' water is safe?
    Secretary Esper and General Milley. The Army would benefit from 
testing and full replacement of lead service lines if they exceed EPA 
guidelines. Our installation housing water lines are connected to lead 
water main lines which are situated outside of the housing foot print. 
It is important to note that some of the water service lines belong to 
either the local municipality or the servicing privatized water system 
owner and not the Army. We will continue to improve our current 
processes and procedures to reduce potential lead exposure.
    Secretary Spencer. The Navy and Marine Corps would benefit from the 
replacement of all lead services lines. Even one child affected by lead 
poisoning is too many. However, it is worth noting that the DON's 
existing lead exposure program is robust and highly regulated, in 
accordance with all federal, state, and local lead regulations. DON 
policy requires military treatment facilities to operate a formal 
pediatric lead screening program and to monitor all beneficiary 
children that exceed lead action levels. While universal blood lead 
level screening of all children is not required, a benefit of TRICARE 
is the assessment of lead exposure risk by questionnaire during each 
well-child visit from age six months through six years and screening by 
blood lead level for children considered to be at high risk for lead 
poisoning. The Navy and Marine Corps Public Health Center (NMCPHC) Epi 
Data Center performs quarterly and annual analyses of childhood blood 
lead levels for Department of the Navy beneficiaries. To date, those 
analyses have consistently found few elevated lead levels, and lower 
rates of elevated lead levels than are reported in the general 
population.
    Admiral Richardson. The Navy and Marine Corps would benefit from 
the replacement of all lead services lines. Even one child affected by 
lead poisoning is too many. However, it is worth noting that the DON's 
existing lead exposure program is robust and highly regulated, in 
accordance with all federal, state, and local lead regulations. DON 
policy requires military treatment facilities to operate a formal 
pediatric lead screening program and to monitor all beneficiary 
children that exceed lead action levels. While universal blood lead 
level screening of all children is not required, a benefit of TRICARE 
is the assessment of lead exposure risk by questionnaire during each 
well-child visit from age six months through six years and screening by 
blood lead level for children considered to be at high risk for lead 
poisoning. The Navy and Marine Corps Public Health Center (NMCPHC) Epi 
Data Center performs quarterly and annual analyses of childhood blood 
lead levels for Department of the Navy beneficiaries. To date, those 
analyses have consistently found few elevated lead levels, and lower 
rates of elevated lead levels than are reported in the general 
population.
    General Neller. The Navy and Marine Corps would benefit from the 
replacement of all lead services lines. Even one child affected by lead 
poisoning is too many. However, it is worth noting that the DON's 
existing lead exposure program is robust and highly regulated, in 
accordance with all federal, state, and local lead regulations. DON 
policy requires military treatment facilities to operate a formal 
pediatric lead screening program and to monitor all beneficiary 
children that exceed lead action levels. While universal blood lead 
level screening of all children is not required, a benefit of TRICARE 
is the assessment of lead exposure risk by questionnaire during each 
well-child visit from age six months through six years and screening by 
blood lead level for children considered to be at high risk for lead 
poisoning. The Navy and Marine Corps Public Health Center (NMCPHC) Epi 
Data Center performs quarterly and annual analyses of childhood blood 
lead levels for Department of the Navy beneficiaries. To date, those 
analyses have consistently found few elevated lead levels, and lower 
rates of elevated lead levels than are reported in the general 
population.
    Secretary Wilson and General Goldfein. Air Force policy supports 
replacement of lines with lead components or content where necessary to 
meet federal water quality standards.

    31. Senator Duckworth. Secretary Esper, General Milley, Secretary 
Spencer, Admiral Richardson, General Neller, Secretary Wilson, and 
General Goldfein, would you support Congress establishing a program to 
achieve this goal?
    Secretary Esper and General Milley. We would welcome the 
opportunity to establish an appropriately funded program.
    Secretary Spencer. Should Congress appropriate sufficient funding 
to cover the cost of full lead service line replacement, the DON would 
welcome the opportunity to achieve this goal.
    Admiral Richardson. hould Congress appropriate sufficient funding 
to cover the cost of full lead service line replacement, the DON would 
welcome the opportunity to achieve this goal.
    General Neller. Should Congress appropriate sufficient funding to 
cover the cost of full lead service line replacement, the DON would 
welcome the opportunity to achieve this goal.
    Secretary Wilson and General Goldfein. Air Force policy supports 
replacement of lines with lead components or content where necessary to 
meet federal water quality standards.
    communication between services and service members and families
    32. Senator Duckworth. Secretary Esper, General Milley, Secretary 
Spencer, Admiral Richardson, General Neller, Secretary Wilson, and 
General Goldfein, at last week's Personnel Subcommittee hearing, Master 
Chief Petty Officer Smith noted the disconnect between the way families 
and servicemembers want to communicate and the way that the Navy 
actually solicits feedback. Do the Services offer direct avenues of 
communication outside of the immediate chain of command that 
servicemembers and their families can reach out to if they are not 
receiving satisfactory treatment or adequate answers to their concerns 
about housing conditions?
    Secretary Esper and General Milley. The Army offers other avenues 
of communication outside the chain of command that servicemembers and 
their families can contact if they are not receiving satisfactory 
treatment or adequate answers to their housing concerns or conditions. 
All residents have an Army advocate at each installation housing office 
with whom they can discuss their housing concerns. Dissatisfied 
residents can submit their concerns or complaints through Army housing 
entities from HQDA to the installation housing office, and residents 
can call the installation housing hot line about their concerns. 
Residents can also escalate their concerns to the RCI project company. 
The Army and RCI project company will collaborate to ensure all 
reported problems and issues are heard and resolved. We are 
communicating with residents to ensure they understand that they have 
the exact same protection available to anyone under the Fair Housing 
Act, without having to face any fear of reprisals.
    Secretary Spencer. Yes. Unsatisfied Navy residents may contact the 
Navy Housing Service Center. Each Navy installation has flyers posted 
in the housing office and online that include points of contact for 
resident support and dispute/issue resolution. In addition, each 
installation, region, and CNIC headquarters has a ``vanity email'' 
(direct link to housing advocates and Navy leadership at the 
installation/region/HQ level) set up to receive communications directly 
from residents 24/7, with a response within 24 hours. Marine Corps 
Commanders will use the Marine Housing Outreach program to improve 
their awareness of concerns, better advocate for military families and 
reinforce the three-step resolution process. Commanders will leverage 
appointed servicemember advocates and the base housing office to 
streamline communication between residents, PPV partners and 
installation leadership. Both Commanders and appointed advocates will 
ensure effective oversight and remediation are in place, operating with 
the full authority and support of the chain of command.
    Admiral Richardson. Yes. Unsatisfied Navy residents may contact the 
Navy Housing Service Center. Each Navy installation has flyers posted 
in the housing office and online that include points of contact for 
resident support and dispute/issue resolution. In addition, each 
installation, region, and CNIC headquarters has a ``vanity email'' 
(direct link to housing advocates and Navy leadership at the 
installation/region/HQ level) set up to receive communications directly 
from residents 24/7, with a response within 24 hours. Marine Corps 
Commanders will use the Marine Housing Outreach program to improve 
their awareness of concerns, better advocate for military families and 
reinforce the three-step resolution process. Commanders will leverage 
appointed servicemember advocates and the base housing office to 
streamline communication between residents, PPV partners and 
installation leadership. Both Commanders and appointed advocates will 
ensure effective oversight and remediation are in place, operating with 
the full authority and support of the chain of command.
    General Neller. Yes. Unsatisfied Navy residents may contact the 
Navy Housing Service Center. Each Navy installation has flyers posted 
in the housing office and online that include points of contact for 
resident support and dispute/issue resolution. In addition, each 
installation, region, and CNIC headquarters has a ``vanity email'' 
(direct link to housing advocates and Navy leadership at the 
installation/region/HQ level) set up to receive communications directly 
from residents 24/7, with a response within 24 hours. Marine Corps 
Commanders will use the Marine Housing Outreach program to improve 
their awareness of concerns, better advocate for military families and 
reinforce the three-step resolution process. Commanders will leverage 
appointed servicemember advocates and the base housing office to 
streamline communication between residents, PPV partners and 
installation leadership. Both Commanders and appointed advocates will 
ensure effective oversight and remediation are in place, operating with 
the full authority and support of the chain of command.
    Secretary Wilson and General Goldfein. The Air Force is adding a 
resident advocate position in the government Housing Management Offices 
to provide direct support to residents. Additionally, a toll-free help 
line has been established and widely advertised for residents to report 
their concerns with privatized housing. Messages to the toll-free help 
line are received by the Air Force Civil Engineer Center, coordinated 
for further action with the project owner, and tracked to satisfactory 
completion.
              oversight of company performance evaluations
    33. Senator Duckworth. Secretary Esper, General Milley, Secretary 
Spencer, Admiral Richardson, General Neller, Secretary Wilson, and 
General Goldfein, based upon testimonies and briefings we have already 
had on this subject, I understand private military housing contractors 
earn incentive fees based upon performance assessments. Are public 
reports that note these contractors receive all, or nearly all, of 
their performance-based fees accurate?
    Secretary Esper and General Milley. The past public reports about 
RCI project company performance-based fees are accurate. The Army is 
updating the project company incentive management plans.
    Secretary Spencer. [Retained in Committee files.]
    Admiral Richardson. [Retained in Committee files.]
    General Neller. Please refer to Attachment 3 [Retained in Committee 
files.] for a ten-year history of incentive-based fees. Performance 
Incentive Fees are paid in accordance with the metrics that are 
reflected in the operating agreements for these projects. While the 
metrics used for each project may vary, maintenance performance is 
typically one of many metrics that are used to assess the amount of 
Performance Incentive Fees that are to be paid to a project owner. As a 
general matter, it is accurate to state that, in accordance with the 
agreed upon metrics, a large portion of the available Performance 
Incentive Fees have been awarded to date. The Air Force is re-
negotiating the structure of Performance Incentive Fees to provide 
commanders and residents with greater influence and to better align the 
metrics to strategic objectives to incentivize desired behavior to 
better serve our members.
    Secretary Wilson General Goldfein. Performance Incentive Fees are 
paid in accordance with the metrics that are reflected in the operating 
agreements for these projects. While the metrics used for each project 
may vary, maintenance performance is typically one of many metrics that 
are used to assess the amount of Performance Incentive Fees that are to 
be paid to a project owner. As a general matter, it is accurate to 
state that, in accordance with the agreed upon metrics, a large portion 
of the available Performance Incentive Fees have been awarded to date. 
The Air Force is re-negotiating the structure of Performance Incentive 
Fees to provide commanders and residents with greater influence and to 
better align the metrics to strategic objectives to incentivize desired 
behavior to better serve our members.

    34. Senator Duckworth. Secretary Esper, General Milley, Secretary 
Spencer, Admiral Richardson, General Neller, Secretary Wilson, and 
General Goldfein, if true, please explain how these companies could be 
earning payments for good performance in light of the deeply troubling 
condition of their housing offerings.
    Secretary Esper and General Milley. RCI project company 
performance-based fees are dictated by the legal agreements and based 
on metrics developed jointly between the Army and the RCI project 
company. Approval authority of the performance incentive fees is now at 
the Office of the Assistant Secretary of the Army for Installations, 
Environment and Energy (ASA IE&E) in February 2019. As a result, 
incentive fees awarded and withheld along with justifications are 
tracked and monitored by ASA IE&E.
    Secretary Spencer. For DON PPV projects, fees are paid to companies 
that Managing Members (a.k.a. PPV Partners) contract with on behalf of 
Limited Liability Companies (LLCs) to carry out the purposes of the 
LLCs. These fees are paid out of funding available to the LLCs, 
primarily revenue. Both base & incentive fees are documented in the 
operating agreement of the LLC or attachments to that operating 
agreement, and cannot be revised without DON approval. The vast 
majority (98.3 percent) of fees that are unearned (i.e. not paid) 
continue through the revenue distribution (cash flow waterfall) of the 
LLC and are captured in sustainment reserve accounts for the 
recapitalization and sustainment of housing over the long-term. The DON 
is in the process of revisiting the incentive fee structure with the 
PPV partners to emphasize resident satisfaction and increase the DON 
discretionary component.
    Admiral Richardson. For DON PPV projects, fees are paid to 
companies that Managing Members (a.k.a. PPV Partners) contract with on 
behalf of Limited Liability Companies (LLCs) to carry out the purposes 
of the LLCs. These fees are paid out of funding available to the LLCs, 
primarily revenue. Both base & incentive fees are documented in the 
operating agreement of the LLC or attachments to that operating 
agreement, and cannot be revised without DON approval. The vast 
majority (98.3 percent) of fees that are unearned (i.e. not paid) 
continue through the revenue distribution (cash flow waterfall) of the 
LLC and are captured in sustainment reserve accounts for the 
recapitalization and sustainment of housing over the long-term. The DON 
is in the process of revisiting the incentive fee structure with the 
PPV partners to emphasize resident satisfaction and increase the DON 
discretionary component.
    General Neller. For DON PPV projects, fees are paid to companies 
that Managing Members (a.k.a. PPV Partners) contract with on behalf of 
Limited Liability Companies (LLCs) to carry out the purposes of the 
LLCs. These fees are paid out of funding available to the LLCs, 
primarily revenue. Both base & incentive fees are documented in the 
operating agreement of the LLC or attachments to that operating 
agreement, and cannot be revised without DON approval. The vast 
majority (98.3 percent) of fees that are unearned (i.e. not paid) 
continue through the revenue distribution (cash flow waterfall) of the 
LLC and are captured in sustainment reserve accounts for the 
recapitalization and sustainment of housing over the long-term. The DON 
is in the process of revisiting the incentive fee structure with the 
PPV partners to emphasize resident satisfaction and increase the DON 
discretionary component.
    Secretary Wilson and General Goldfein. Performance Incentive Fees 
are paid in accordance with the metrics that are reflected in the 
operating agreements for these projects. While the metrics used for 
each project may vary, maintenance performance is typically one of many 
metrics that are used to assess the amount of Performance Incentive 
Fees that are to be paid to a project owner. Other common criteria 
include: occupancy rates, annual resident satisfaction survey scores, 
achieving target financial performance, and submitting annual budget 
and other required financial information on time.
    Additionally, in cases of housing projects that are made up of 
housing at multiple bases, in some instances the average performance at 
all the bases is used to determine the performance-based award. This 
averaged performance assessment across the project at times can mask 
poor performance at one location.
    The Air Force is re-negotiating the structure of Performance 
Incentive Fees to provide commanders and residents with greater 
influence and to align the metrics to strategic objectives to 
incentivize desired behavior.
                               __________
               Questions Submitted by Senator Doug Jones
     historic houses on maxwell air force base, montgomery, alabama
    35. Senator Jones. General Goldfein, what is the Air Force's plan 
to preserve the historic homes at Maxwell Air Force Base in Montgomery, 
Alabama?
    General Goldfein. The Air Force is exploring the possibility of 
removing from the housing project the requirement to operate and 
maintain the utility and street infrastructure at Maxwell AFB. This 
action would bring an appropriated funding requirement to the Air Force 
but would free up project resources for the project owner's maintenance 
and upkeep of the historical housing units.

    36. Senator Jones. General Goldfein, are you aware if there are 
issues with leaks, flooding, insects, lead paint, mold, or asbestos in 
the historic homes at Maxwell that have not been mitigated?
    General Goldfein. During the recent 100 percent check of all units, 
97 residents identified a life / health / safety concern (53 mold, 21 
lead-based paint, 23 pests/rodents). All of the 97 issues have been 
resolved, to include those in the historic units.

    37. Senator Jones. General Goldfein, are there mitigation plans and 
enough funds available to preserve these historic homes in a safe, 
reliable, and energy efficient manner?
    General Goldfein. Financial forecasts indicate that the housing 
project that includes Maxwell will struggle to keep homes in good 
repair and limited funds will be available for renovation/reinvestment 
of the homes. The Air Force is in the process of taking back utility 
and road infrastructure within the housing area, in order to relieve 
the project of some financial obligations so more funds can be focused 
on sustainment of all homes at Maxwell.

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