USC Subchapter IV

USC Subchapter IV
in effect

10 U.S.C. § 2871 Definitions

In this subchapter and subchapter V of this chapter: (1) The term “ancillary supporting facilities” means facilities related to housing units, including facilities to provide or support elementary or secondary education, child care centers, day care centers, child development centers, tot lots, community centers, housing offices, dining facilities, unit offices, and other similar facilities for the support of military housing. (2) The term “child development center” includes a facility, and the utilities to support such facility, the function of which is to support the daily care of children aged six weeks old through five years old for full-day, part-day, and hourly service. (3) The term “construction” means the construction of housing units and ancillary supporting facilities or the improvement or rehabilitation of existing units or ancillary supporting facilities. (4) The term “contract” includes any contract, lease, or other agreement entered into under the authority of this subchapter. The fact that an agreement between an eligible entity and the Secretary concerned is designated as an agreement rather than a contract shall not be construed to exclude the agreement from the term “contract” for purposes of this subchapter and subchapter V. (5) The term “eligible entity” means any private person, corporation, firm, partnership, company, State or local government, or housing authority of a State or local government that is prepared to enter into a contract as a partner with the Secretary concerned for the construction of housing units and ancillary supporting facilities. (6) The term “Fund” means the Department of Defense Family Housing Improvement Fund or the Department of Defense Military Unaccompanied Housing Improvement Fund established under section 2883(a) of this title. (7) The term “housing document” means a document developed by the Secretary of Defense under section 2890 of this title and known as the Military Housing Privatization Initiative Tenant Bill of Rights or the Military Housing Privatization Initiative Tenant Responsibilities. (8) The term “housing unit” means a unit of family housing or military unaccompanied housing acquired or constructed under this subchapter. (9) The term “incentive fees” means any amounts payable to a landlord for meeting or exceeding performance metrics as specified in a contract with the Department of Defense. (10) The term “landlord” means an eligible entity that enters into, or has entered into, a contract as a partner with the Secretary concerned for the acquisition or construction of a housing unit under this subchapter. The term includes any agent of the eligible entity or any subsequent lessor who owns, manages, or is otherwise responsible for a housing unit. The term does not include an entity of the Federal Government. (11) The term “military unaccompanied housing” means military housing intended to be occupied by members of the armed forces serving a tour of duty unaccompanied by dependents and transient housing intended to be occupied by members of the armed forces on temporary duty. (12) The term “tenant” means a member of the armed forces, including a reserve component thereof in an active status, or a dependent of a member of the armed forces who resides at a housing unit, is a party to a lease for a housing unit, or is authorized to act on behalf of the member under this subchapter and subchapter V of this chapter in the event of the assignment or deployment of a member. (13) The term “United States” includes the Commonwealth of Puerto Rico.

10 U.S.C. § 2872 General authority

In addition to any other authority provided under this chapter for the acquisition or construction of military family housing or military unaccompanied housing, the Secretary concerned may exercise any authority or any combination of authorities provided under this subchapter in order to provide for the acquisition or construction by eligible entities of the following: (1) Family housing units on or near military installations within the United States and its territories and possessions, including such units for civilian employees of the Department of Defense and defense contractors. (2) Military unaccompanied housing units on or near such military installations.

10 U.S.C. § 2872a Utilities and services

(a) Authority To Furnish.—The Secretary concerned may furnish utilities and services referred to in subsection (b) in connection with any military housing acquired or constructed pursuant to the exercise of any authority or combination of authorities under this subchapter if the military housing is located on a military installation. (b) Covered Utilities and Services.—The utilities and services that may be furnished under subsection (a) are the following:(1) Electric power. (2) Steam. (3) Compressed air. (4) Water. (5) Sewage and garbage disposal. (6) Natural gas. (7) Pest control. (8) Snow and ice removal. (9) Mechanical refrigeration. (10) Telecommunications service. (11) Firefighting and fire protection services. (12) Police protection services. (13) Street sweeping. (14) Tree trimming and removal. (c) Reimbursement.—(1) The Secretary concerned shall be reimbursed for any utilities or services furnished under subsection (a). (2) The amount of any cash payment received under paragraph (1) as reimbursement for the cost of furnishing utilities or services shall—(A) in the case of a cost paid using funds appropriated or otherwise made available before October 1, 2014, be credited to the appropriation or working capital account from which the cost of furnishing utilities or services concerned was paid; or (B) in the case of a cost paid using funds appropriated or otherwise made available on or after October 1, 2014, be credited to the appropriation or working capital account currently available for the purpose of furnishing utilities or services under subsection (a). (3) Amounts credited under paragraph (2) to an appropriation or account shall be merged with funds in such appropriation or account, and shall be available to the same extent, and subject to the same terms and conditions, as such funds.

10 U.S.C. § 2872b Treatment of breach of contract

(a) Response to Material Breach.—In the case of a material breach of contract under this subchapter by a party to the contract, the Secretary concerned shall use the authorities available to the Secretary, including withholding amounts to be paid under the contract, to encourage the party to cure the breach. (b) Rescinding of Contract.—If a material breach of the contract is not cured in a timely manner, as determined by the Secretary concerned, the Secretary may—(1) rescind the contract pursuant to the terms of the contract; and (2) prohibit the offending party from entering into a new contract or undertaking expansions of other existing contracts, or both, with the Secretary under this subchapter.

10 U.S.C. § 2873 Direct loans and loan guarantees

(a) Direct Loans.—(1) Subject to subsection (c), the Secretary concerned may make direct loans to an eligible entity in order to provide funds to the eligible entity for the acquisition or construction of housing units that the Secretary determines are suitable for use as military family housing or as military unaccompanied housing. (2) The Secretary concerned shall establish such terms and conditions with respect to loans made under this subsection as the Secretary considers appropriate to protect the interests of the United States, including the period and frequency for repayment of such loans and the obligations of the obligors on such loans upon default. (b) Loan Guarantees.—(1) Subject to subsection (c), the Secretary concerned may guarantee a loan made to an eligible entity if the proceeds of the loan are to be used by the eligible entity to acquire, or construct housing units that the Secretary determines are suitable for use as military family housing or as military unaccompanied housing. (2) The amount of a guarantee on a loan that may be provided under paragraph (1) may not exceed the amount equal to the lesser of—(A) the amount equal to 80 percent of the value of the project; or (B) the amount of the outstanding principal of the loan. (3) The Secretary concerned shall establish such terms and conditions with respect to guarantees of loans under this subsection as the Secretary considers appropriate to protect the interests of the United States, including the rights and obligations of obligors of such loans and the rights and obligations of the United States with respect to such guarantees. (c) Limitation on Direct Loan and Guarantee Authority.—Direct loans and loan guarantees may be made under this section only to the extent that appropriations of budget authority to cover their cost (as defined in section 502(5) of the Federal Credit Reform Act of 1990 (2 U.S.C. 661a(5))) are made in advance, or authority is otherwise provided in appropriation Acts. If such appropriation or other authority is provided, there may be established a financing account (as defined in section 502(7) of such Act (2 U.S.C. 661a(7))), which shall be available for the disbursement of direct loans or payment of claims for payment on loan guarantees under this section and for all other cash flows to and from the Government as a result of direct loans and guarantees made under this section.

10 U.S.C. § 2874 Leasing of housing

(a) Lease Authorized.—The Secretary concerned may enter into contracts for the lease of housing units that the Secretary determines are suitable for use as military family housing or military unaccompanied housing. (b) Use of Leased Units.—The Secretary concerned shall utilize housing units leased under this section as military family housing or military unaccompanied housing, as appropriate. (c) Lease Terms.—A contract under this section may be for any period that the Secretary concerned determines appropriate and may provide for the owner of the leased property to operate and maintain the property.

10 U.S.C. § 2875 Investments

(a) Investments Authorized.—The Secretary concerned may make investments in an eligible entity carrying out projects for the acquisition or construction of housing units suitable for use as military family housing or as military unaccompanied housing. (b) Forms of Investment.—An investment under this section may take the form of an acquisition of a limited partnership interest by the United States, a purchase of stock or other equity instruments by the United States, a purchase of bonds or other debt instruments by the United States, or any combination of such forms of investment. (c) Limitation on Value of Investment.—(1) The cash amount of an investment under this section in an eligible entity may not exceed an amount equal to 33⅓ percent 11 See Temporary Increase in Percentage of Value of Authorized Investment in Certain Privatized Military Housing Projects note below. of the capital cost (as determined by the Secretary concerned) of the project or projects that the eligible entity proposes to carry out under this section with the investment. (2) If the Secretary concerned conveys land or facilities to an eligible entity as all or part of an investment in the eligible entity under this section, the total value of the investment by the Secretary under this section may not exceed an amount equal to 45 percent 1 of the capital cost (as determined by the Secretary) of the project or projects that the eligible entity proposes to carry out under this section with the investment. (3) In this subsection, the term “capital cost”, with respect to a project for the acquisition or construction of housing, means the total amount of the costs included in the basis of the housing for Federal income tax purposes. (d) Collateral Incentive Agreements.—The Secretary concerned shall enter into collateral incentive agreements with eligible entities in which the Secretary makes an investment under this section to ensure that a suitable preference will be afforded members of the armed forces and their dependents in the lease or purchase, as the case may be, of a reasonable number of the housing units covered by the investment.

10 U.S.C. § 2876 Rental guarantees

The Secretary concerned may enter into agreements with eligible entities that acquire or construct military family housing units or military unaccompanied housing units under this subchapter in order to assure— (1) the occupancy of such units at levels specified in the agreements; or (2) rental income derived from rental of such units at levels specified in the agreements.

10 U.S.C. § 2877 Differential lease payments

Pursuant to an agreement entered into by the Secretary concerned and a lessor of military family housing or military unaccompanied housing to members of the armed forces, the Secretary may pay the lessor an amount in addition to the rental payments for the housing made by the members as the Secretary determines appropriate to encourage the lessor to make the housing available to members of the armed forces as military family housing or as military unaccompanied housing.

10 U.S.C. § 2878 Conveyance or lease of existing property and facilities

(a) Conveyance or Lease Authorized.—The Secretary concerned may convey or lease property or facilities (including ancillary supporting facilities) to eligible entities for purposes of using the proceeds of such conveyance or lease to carry out activities under this subchapter. (b) Inapplicability to Property at Installation Approved for Closure.—The authority of this section does not apply to property or facilities located on or near a military installation approved for closure under a base closure law. (c) Competitive Process.—The Secretary concerned shall ensure that the time, method, and terms and conditions of the reconveyance or lease of property or facilities under this section from the eligible entity permit full and free competition consistent with the value and nature of the property or facilities involved. (d) Terms and Conditions.—(1) The conveyance or lease of property or facilities under this section shall be for such consideration and upon such terms and conditions as the Secretary concerned considers appropriate for the purposes of this subchapter and to protect the interests of the United States. (2) As part or all of the consideration for a conveyance or lease under this section, the purchaser or lessor (as the case may be) shall enter into an agreement with the Secretary to ensure that a suitable preference will be afforded members of the armed forces and their dependents in the lease or sublease of a reasonable number of the housing units covered by the conveyance or lease, as the case may be, or in the lease of other suitable housing units made available by the purchaser or lessee. (e) Inapplicability of Certain Property Management Laws.—The conveyance or lease of property or facilities under this section shall not be subject to the following provisions of law:(1) Section 2667 of this title. (2) Subtitle I of title 40 and division C (except sections 3302, 3501(b), 3509, 3906, 4710, and 4711) of subtitle I of title 41. (3) Section 1302 of title 40. (4) Section 501 of the McKinney-Vento Homeless Assistance Act (42 U.S.C. 11411). (f) Notice of Lease Extensions.—(1) The Secretary concerned shall provide to the congressional defense committees notice in writing and a briefing—(A) not later than 60 days after beginning negotiations with a lessor for the extension of the term of any ground lease of property or facilities under this section; and (B) not later than 90 days before extending the term of any ground lease of property or facilities under this section. (2) A notice and briefing required under paragraph (1) shall include each of the following:(A) A description of any material differences between the extended ground lease and the original ground lease, including with respect to—(i) the length of the term of the lease, as extended; and (ii) any new provisions that materially affect the rights and responsibilities of the ground lessor or the ground lessee under the original ground lease. (B) The number of housing units or facilities subject to the ground lease that, during the lease extension, are to be—(i) constructed; (ii) demolished; or (iii) renovated. (C) The source of any additional financing the lessor has obtained, or intends to obtain, during the term of the ground lease extension that will be used for the development of the property or facilities subject to the ground lease. (D) The following information, displayed annually, for the five-year period preceding the date of the notice and briefing:(i) The debt-to-net operating income ratio for the property or facility subject to the ground lease. (ii) The occupancy rates for the housing units subject to the ground lease. (iii) A report on maintenance response times and completion of maintenance requests for the housing units subject to the ground lease. (iv) The occupancy rates and debt-to-net operating income ratios of any other military privatized housing initiative projects managed by a company that controls, or that is under common control with, the ground lessee entering into the lease extension. (E) An assessment of compliance by the lessor with the Military Housing Privatization Initiative Tenant Bill of Rights developed under section 2890 of this title.

10 U.S.C. § 2880 Unit size and type

(a) Conformity With Similar Housing Units in Locale.—The Secretary concerned shall ensure that the room patterns and floor areas of military family housing units and military unaccompanied housing units acquired or constructed under this subchapter are generally comparable to the room patterns and floor areas of similar housing units in the locality concerned. (b) Inapplicability of Limitations on Space by Pay Grade.—Sections 2826 and 2856 of this title shall not apply to military family housing or military unaccompanied housing units acquired or constructed under this subchapter.

10 U.S.C. § 2881 Ancillary supporting facilities

(a) Authority To Acquire or Construct.—Any project for the acquisition or construction of military family housing units or military unaccompanied housing units under this subchapter may include the acquisition or construction of ancillary supporting facilities for the housing units concerned. (b) Restriction.—A project referred to in subsection (a) may not include the acquisition or construction of an ancillary supporting facility (other than a child development center) if, as determined by the Secretary concerned, the facility is to be used for providing merchandise or services in direct competition with—(1) the Army and Air Force Exchange Service; (2) the Navy Exchange Service Command; (3) a Marine Corps exchange; (4) the Defense Commissary Agency; or (5) any nonappropriated fund activity of the Department of Defense for the morale, welfare, and recreation of members of the armed forces.

10 U.S.C. § 2881a Temporary authority for acquisition or construction of privatized military unaccompanied housing

(a) In General.—The Secretary concerned may use the authority under this subchapter to enter into contracts with appropriate private sector entities for the acquisition or construction of military unaccompanied housing in the United States, including any territory or possession of the United States. (b) Treatment of Housing; Assignment of Members.—The Secretary concerned may assign members of the armed forces without dependents to housing units acquired or constructed pursuant to this section, and such housing units shall be considered as quarters of the United States or a housing facility under the jurisdiction of the Secretary for purposes of section 403 of title 37. (c) Basic Allowance for Housing.—(1) The Secretary of Defense may prescribe and, under section 403(o) of title 37, pay for members of the armed forces without dependents in privatized housing units acquired or constructed pursuant to this section higher rates of partial basic allowance for housing than the rates authorized under paragraph (2) of such section. (2) The partial basic allowance for housing paid for a member at a higher rate under this subsection may be paid directly to the private sector source of the housing to whom the member is obligated to pay rent or other charge for residing in such housing if the private sector source credits the amount so paid against the amount owed by the member for the rent or other charge. (d) Funding.—(1) The Secretary concerned shall use the Department of Defense Military Unaccompanied Housing Improvement Fund to carry out activities pursuant to this section. (2) Subject to 30 days prior notification to the appropriate committees of Congress in an electronic medium pursuant to section 480 of this title, such additional amounts as the Secretary of Defense considers necessary may be transferred to the Department of Defense Military Unaccompanied Housing Improvement Fund from amounts appropriated for construction of military unaccompanied housing in military construction accounts. The amounts so transferred shall be merged with and be available for the same purposes and for the same period of time as amounts appropriated directly to the Fund. (e) Expiration.—The authority of the Secretary concerned to enter into a contract under this section shall expire September 30, 2029.

10 U.S.C. § 2882 Effect of assignment of members to housing units acquired or constructed under alternative authority

(a) Treatment as Quarters of the United States.—Except as provided in subsection (b), housing units acquired or constructed under this subchapter shall be considered as quarters of the United States or a housing facility under the jurisdiction of a uniformed service for purposes of section 403 of title 37. (b) Availability of Basic Allowance for Housing.—A member of the armed forces who is assigned to a housing unit acquired or constructed under this subchapter that is not owned or leased by the United States shall be entitled to a basic allowance for housing under section 403 of title 37. (c) Lease Payments Through Pay Allotments.—The Secretary concerned may require members of the armed forces who lease housing in housing units acquired or constructed under this subchapter to make lease payments for such housing pursuant to allotments of the pay of such members under section 701 of title 37.

10 U.S.C. § 2883 Department of Defense Housing Funds

(a) Establishment.—There are hereby established on the books of the Treasury the following accounts:(1) The Department of Defense Family Housing Improvement Fund. (2) The Department of Defense Military Unaccompanied Housing Improvement Fund. (b) Commingling of Funds Prohibited.—(1) The Secretary of Defense shall administer each Fund separately. (2) Amounts in the Department of Defense Family Housing Improvement Fund may be used only to carry out activities under this subchapter with respect to military family housing. (3) Amounts in the Department of Defense Military Unaccompanied Housing Improvement Fund may be used only to carry out activities under this subchapter with respect to military unaccompanied housing. (c) Credits to Funds.—(1) There shall be credited to the Department of Defense Family Housing Improvement Fund the following:(A) Amounts authorized for and appropriated to that Fund. (B) Subject to subsection (f), any amounts that the Secretary of Defense transfers, in such amounts as provided in appropriation Acts, to that Fund from amounts authorized and appropriated to the Department of Defense for the acquisition, improvement, or construction of military family housing. (C) Proceeds from the conveyance or lease of property or facilities under section 2878 of this title for the purpose of carrying out activities under this subchapter with respect to military family housing. (D) Income derived from any activities under this subchapter with respect to military family housing, including interest on loans made under section 2873 of this title, income and gains realized from investments under section 2875 of this title, and any return of capital invested as part of such investments. (E) Any amounts that the Secretary of the Navy transfers to that Fund pursuant to section 2814(i)(3) of this title, subject to the restrictions on the use of the transferred amounts specified in that section. (F) Any amounts that the Secretary concerned transfers to that Fund pursuant to section 2869 of this title. (2) There shall be credited to the Department of Defense Military Unaccompanied Housing Improvement Fund the following:(A) Amounts authorized for and appropriated to that Fund. (B) Subject to subsection (f), any amounts that the Secretary of Defense transfers, in such amounts as provided in appropriation Acts, to that Fund from amounts authorized and appropriated to the Department of Defense for the acquisition or construction of military unaccompanied housing. (C) Proceeds from the conveyance or lease of property or facilities under section 2878 of this title for the purpose of carrying out activities under this subchapter with respect to military unaccompanied housing. (D) Income derived from any activities under this subchapter with respect to military unaccompanied housing, including interest on loans made under section 2873 of this title, income and gains realized from investments under section 2875 of this title, and any return of capital invested as part of such investments. (E) Any amounts that the Secretary of the Navy transfers to that Fund pursuant to section 2814(i)(3) of this title, subject to the restrictions on the use of the transferred amounts specified in that section. (F) Any amounts that the Secretary concerned transfers to that Fund pursuant to section 2869 of this title. (d) Use of Amounts in Funds.—(1)(A) In such amounts as provided in appropriation Acts and except as provided in subsection (e), the Secretary of Defense may use amounts in the Department of Defense Family Housing Improvement Fund to carry out activities under this subchapter with respect to military family housing, including activities required in connection with the planning, execution, and administration of contracts entered into under the authority of this subchapter. The Secretary may also use for expenses of activities required in connection with the planning, execution, and administration of such contracts funds that are otherwise available to the Department of Defense for such types of expenses. (B) The Secretary of Defense shall require that eligible entities receiving amounts from the Department of Defense Family Housing Improvement Fund prioritize the use of such amounts for expenditures related to asset recapitalization, operating expenses, and debt payments before other program management-incentive fee expenditures. In the case of asset recapitalization, the primary purpose of the expenditures must be to sustain existing housing units owned or managed by the eligible entity or for which the eligible entity is otherwise responsible. (2) In such amounts as provided in appropriation Acts and except as provided in subsection (e), the Secretary of Defense may use amounts in the Department of Defense Military Unaccompanied Housing Improvement Fund to carry out activities under this subchapter with respect to military unaccompanied housing, including activities required in connection with the planning, execution, and administration of contracts entered into under the authority of this subchapter. The Secretary may also use for expenses of activities required in connection with the planning, execution, and administration of such contracts funds that are otherwise available to the Department of Defense for such types of expenses. (3) Amounts made available under this subsection shall remain available until expended. The Secretary of Defense may transfer amounts made available under this subsection to the Secretaries of the military departments to permit such Secretaries to carry out the activities for which such amounts may be used. (e) Limitation on Obligations.—(1) The Secretary may not incur an obligation under a contract or other agreement entered into under this subchapter in excess of the unobligated balance, at the time the contract is entered into, of the Fund required to be used to satisfy the obligation. (2) The Funds established under subsection (a) shall be the sole source of funds for activities carried out under this subchapter. (f) Notification Required for Transfers.—A transfer of appropriated amounts to a Fund under subparagraph (B) of paragraph (1) or subparagraph (B) of paragraph (2) of subsection (c) may be made only after the end of the 14-day period beginning on the date the Secretary of Defense submits notice of, and justification for, the transfer to the appropriate committees of Congress in an electronic medium pursuant to section 480 of this title.

10 U.S.C. § 2883a Funds for housing allowances of members of the armed forces assigned to certain military family housing units

(a) Authority to Transfer Funds To Cover Housing Allowances.—During the fiscal year in which a contract is awarded for the acquisition or construction of military family housing units under this subchapter that are not to be owned by the United States, the Secretary of Defense may transfer the amount determined under subsection (b) with respect to such housing from appropriations available for support of military housing for the armed force concerned for that fiscal year to appropriations available for pay and allowances of military personnel of that same armed force for that same fiscal year. (b) Amount Transferred.—The total amount authorized to be transferred under subsection (a) in connection with a contract under this subchapter may not exceed an amount equal to any additional amounts payable during the fiscal year in which the contract is awarded to members of the armed forces assigned to the acquired or constructed housing units as basic allowance for housing under section 403 of title 37 that would not otherwise have been payable to such members if not for assignment to such housing units. (c) Transfers Subject to Appropriations.—The transfer of funds under the authority of subsection (a) is limited to such amounts as may be provided in advance in appropriations Acts.

10 U.S.C. § 2884 Reports

(a) Project Reports.—(1) The Secretary concerned shall transmit to the appropriate committees of Congress a report describing—(A) each contract or agreement for the acquisition or construction of family housing units or unaccompanied housing units under this subchapter; and (B) each conveyance or lease proposed under section 2878 of this title. (2) A report required by paragraph (1) shall include the following:(A) A description of the contract, agreement, conveyance, or lease, including a summary of the terms of the contract, agreement, conveyance, or lease. (B) A description of the authorities to be utilized in entering into the contract, agreement, conveyance, or lease and the intended method of participation of the United States in the contract, agreement, conveyance, or lease, including a justification of the intended method of participation. (C) A statement of the scored cost of the contract, agreement, conveyance, or lease, as determined by the Office of Management and Budget. (D) A statement of the United States funds required for the contract, agreement, conveyance, or lease and a description of the source of such funds, including a description of the specific construction, acquisition, or improvement projects from which funds were transferred to the Funds established under section 2883 of this title in order to finance the contract, agreement, conveyance, or lease. (E) An economic assessment of the life cycle costs of the contract, agreement, conveyance, or lease, including an estimate of the amount of United States funds that would be paid over the life of the contract, agreement, conveyance, or lease from amounts derived from payments of government allowances, including the basic allowance for housing under section 403 of title 37, if the housing affected by the project were fully occupied by military personnel over the life of the contract, agreement, conveyance, or lease. (3)(A) In the case of a contract or agreement described in paragraph (1) proposed to be entered into with a private party, the report shall specify whether the contract or agreement will or may include a guarantee (including the making of mortgage or rental payments) by the Secretary to the private party in the event of—(i) the closure or realignment of the installation for which housing will be provided under the contract or agreement; (ii) a reduction in force of units stationed at such installation; or (iii) the extended deployment of units stationed at such installation. (B) If the contract or agreement will or may include such a guarantee, the report shall also—(i) describe the nature of the guarantee; and (ii) assess the extent and likelihood, if any, of the liability of the United States with respect to the guarantee. (4) The report shall be submitted in an electronic medium pursuant to section 480 of this title not later than 21 days before the date on which the Secretary issues the contract solicitation or offers the conveyance or lease. (b) Annual Reports to Accompany Budget Materials.—The Secretary of Defense shall include each year in the materials that the Secretary submits to Congress in support of the budget submitted by the President pursuant to section 1105 of title 31 the following:(1) A separate report on the expenditures and receipts during the preceding fiscal year covering each of the Funds established under section 2883 of this title, including a description of the specific construction, acquisition, or improvement projects from which funds were transferred and the privatization projects or contracts to which those funds were transferred. Each report shall also include, for each military department or defense agency, a description of all funds to be transferred to such Funds for the current fiscal year and the next fiscal year. (2) A report setting forth, by armed force, the following:(A) An estimate of the amounts of basic allowance for housing under section 403 of title 37 that will be paid, during the current fiscal year and the fiscal year for which the budget is submitted, to members of the armed forces living in housing provided under the authorities in this subchapter. (B) The number of units of military family housing and military unaccompanied housing upon which the estimate under subparagraph (A) for the current fiscal year and the next fiscal year is based. (3) A description of the plans for housing privatization activities to be carried out under this subchapter—(A) during the fiscal year for which the budget is submitted; and (B) during the period covered by the then-current future-years defense plan under section 221 of this title. (4) A report identifying each family housing unit acquired or constructed under this subchapter that is used, or intended to be used, as quarters for a general officer or flag officer and for which the total operation, maintenance, and repair costs for the unit exceeded $50,000. For each housing unit so identified, the report shall also include the total of such operation, maintenance, and repair costs. (c) Semi-annual Report on Privatization Projects.—The Secretary of Defense shall submit to the congressional defense committees a semi-annual report containing an evaluation of the status of oversight and accountability measures under section 2885 of this title for military housing privatization projects. To the extent each Secretary concerned has the right to attain the information described in this subsection, each report shall include, at a minimum, the following:(1) An assessment of the backlog of maintenance and repair at each military housing privatization project where a significant backlog exists, including an estimation of the cost of eliminating the maintenance and repair backlog. (2) If the debt associated with a privatization project exceeds net operating income or the occupancy rates for the housing units are below 75 percent for more than one year, the plan developed to mitigate the financial risk of the project. (3) An assessment of any significant project variances between the actual and pro forma deposits in the recapitalization account, to specifically include any unique variances associated with litigation costs. (4) The details of any significant withdrawals from a recapitalization account, including the purpose and rationale of the withdrawal and, if the withdrawal occurs before the normal recapitalization period, the impact of the early withdrawal on the financial health of the project. (5) An assessment of the extent to which the information required to comply with paragraphs (1) through (4) has been requested by the Secretaries, but has not been made available. (6) An assessment of cost assessed to members of the armed forces for utilities compared to utility rates in the local area. (7) An assessment of the condition of housing units based on the average age of those units and the estimated time until recapitalization. (8) An assessment of tenant complaints. (9) An assessment of maintenance response times and completion of maintenance requests. (10) An assessment of the dispute resolution process under section 2894(c) of this title, which shall include a list of dispute resolution cases by installation and the final outcome of each case. (11) An assessment of overall customer service for tenants. (12) A description of the results of any no-notice housing inspections conducted. (13) The results of any resident surveys conducted. (14) With regard to issues of lead-based paint in housing units, a summary of data relating to the presence of lead-based paint in such housing units, including the following by military department:(A) The total number of housing units containing lead-based paint. (B) A description of the reasons for the failure to inspect any housing unit that contains lead-based paint. (C) A description of all abatement or mitigation efforts completed or underway in housing units containing lead-based paint. (D) A certification as to whether military housing under the jurisdiction of the Secretary concerned complies with requirements relating to lead-based paint, lead-based paint activities, and lead-based paint hazards, as described in section 408 of the Toxic Substances Control Act (15 U.S.C. 2688). (15) An explanation of—(A) the housing data used by each Secretary concerned; and (B) the housing data each Secretary concerned requests from companies responsible for managing privatization projects. (16) An assessment of how each Secretary concerned uses such housing data to inform the on-base housing decisions for the military department under the jurisdiction of the Secretary. (17) An explanation of—(A) the limitations of any tenant satisfaction data collected by the Secretary concerned (including limitations with respect to the availability of such data); (B) the process of the Secretary concerned for determining tenant satisfaction; and (C) reasons for missing tenant satisfaction data, if any. (18) To the maximum extent practicable, a breakdown of the information described in paragraphs (1) through (17), disaggregated by—(A) military installation; and (B) military housing privatization project. (d) Annual Briefings.—Not later than February 1 of each year, each Secretary concerned shall provide to the Committees on Armed Services of the Senate and House of Representatives a briefing on military housing privatization projects under the jurisdiction of the Secretary. Such briefing shall include, for the 12-month period preceding the date of the briefing, each of the following:(1) The information described in paragraphs (1) through (18) of subsection (c) of subsection (c) with respect to all military housing privatization projects under the jurisdiction of the Secretary. (2) A review of any such project that is expected to require the restructuring of a loan, including any public or private loan. (3) For any such project expected to require restructuring, a timeline for when such restructuring is expected to occur. (4) Such other information as the Secretary determines appropriate.

10 U.S.C. § 2885 Oversight and accountability for privatization projects

(a) Oversight and Accountability Measures.—Each Secretary concerned shall prescribe regulations to effectively oversee and manage military housing privatization projects carried out under this subchapter during the course of the construction or renovation of the housing units. The regulations shall include the following requirements for each privatization project:(1) The installation asset manager shall conduct monthly site visits and provide quarterly reports on the progress of the construction or renovation of the housing units. The reports shall be submitted quarterly to the assistant secretary for installations and environment of the respective military department. (2) The installation asset manager, and, as applicable, the resident construction manager, privatization asset manager, bondholder representative, project owner, developer, general contractor, and construction consultant for the project shall conduct meetings to ensure that the construction or renovation of the units meets performance and schedule requirements and that appropriate operating and ground lease agreements are in place and adhered to. (3) In the case of a project for new construction, if the project is 90 days or more behind schedule or otherwise appears to be substantially failing to adhere to the obligations or milestones under the contract, the assistant secretary for installations and environment of the respective military department shall submit a notice of deficiency to the Assistant Secretary of Defense for Energy, Installations, and Environment, the Secretary concerned, the managing member, and the trustee for the project. (4)(A) Not later than 15 days after the submittal of a notice of deficiency under paragraph (3), the Secretary concerned or designated representative shall submit to the project owner, developer, or general contractor responsible for the project a summary of deficiencies related to the project. (B) If the project owner, developer, or general contractor responsible for the privatization project is unable, within 60 days after receiving a notice of deficiency under subparagraph (A), to make progress on the issues outlined in such notice, the Secretary concerned shall notify, in an electronic medium pursuant to section 480 of this title, the congressional defense committees of the status of the project and include a recommended course of action to correct the problems. (b) Required Qualifications.—The Secretary concerned or designated representative shall ensure that the project owner, developer, or general contractor that is selected for each military housing privatization initiative project has construction experience commensurate with that required to complete the project. (c) Bonding Levels.—The Secretary concerned shall ensure that the project owner, developer, or general contractor responsible for a military housing privatization initiative project has sufficient payment and performance bonds or suitable instruments in place for each phase of a construction or renovation portion of the project to ensure successful completion of the work in amounts as agreed to in the project’s legal documents, but in no case less than 50 percent of the total value of the active phases of the project, prior to the commencement of work for that phase. (d) Reporting of Efforts To Select Successor in Event of Default.—In the event a military housing privatization initiative project enters into default, the assistant secretary for installations and environment of the respective military department shall submit, in an electronic medium pursuant to section 480 of this title, a report to the congressional defense committees every 90 days detailing the status of negotiations to award the project to a new project owner, developer, or general contractor. (e) Effect of Notices of Deficiency on Contractors and Affiliated Entities.—(1) The Secretary concerned shall keep a record of all plans of action or notices of deficiency issued to a project owner, developer, or general contractor under subsection (a)(4), including the identity of each parent, subsidiary, affiliate, or other controlling entity of such owner, developer, or contractor. (2) Each military department shall consult all records maintained under paragraph (1) when reviewing the past performance of owners, developers, and contractors in the bidding process for a contract or other agreement for a military housing privatization initiative project. (f) Financial Integrity and Accountability Measures.—(1) The regulations required by subsection (a) shall address the following requirements for each military housing privatization project upon the completion of the construction or renovation of the housing units:(A) The financial health and performance of the privatization project, including the debt-coverage ratio of the project and occupancy rates for the housing units. (B) An assessment of the backlog of maintenance and repair of the housing units. (2) If the debt service coverage for a military housing privatization project falls below 1.0 or the occupancy rates for the housing units of the project are below 75 percent for more than one year, the Secretary concerned shall require the development of a plan to address the financial risk of the project.

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