Return to Pointer View home page March 4,  2005

West Point preparing for housing privatization initiative 

Story and photo by Eric S. Bartelt
Senior Staff Writer

The Department of the Army, in its goal toward a mission-focused military, is privatizing many of its current programs to increase the warfighting capacity of its Soldiers.

West Point is headed in that direction with the Residential Community Initiative, which will be the complete privatization of all 997 housing units here.

Changes are on the horizon and the implementation date stands at March 2008 for a private RCI partner to come on board. But, before that, DA will send a contractor here to check the feasibility of this initiative.

“The contractor will be with us a few months,” said Col. Thomas Julich,  Housing and Public Works director. “[They’ll be here] to check whether it makes sense money-wise to implement RCI here, based on the Soldiers’ Basic Allowance for Housing compared to the cost of owning and operating the housing.”

Privatization will not change who occupies quarters at West Point and, with a steady stream of funds, the new RCI partner can do more things than the Army was able to under old fiscal constraints.

“They’ll have the ability to do things well beyond what we could do as far as updating and fixing homes,” said James Kennedy, Housing Division chief. “We did it to the best of our abilities under the Army system, but this new system can generate more money and they’re [RCI partners] not held to the same rules or outlays of money that we are.

“All the fiscal-year constraints that hamstrung us from doing all the necessary improvements are not there at all for them,” Kennedy added. “Being funded through congressional appropriations, which changes every year, we never exactly knew what we were going to get money-wise.

“Some years we just had enough money to pay the salaries of our people and the utilities and that was about it,” he said.

The RCI process begins around October with the visit of Jones, Lang, LaSalle -- a privatization support contractor -- who will study the economic feasibility of privatization.

“They will tell us how to prepare for RCI, they will train us, show us what has to go into a document room that will be filled with information available to all potential partners,” Kennedy said. “They’ll tell us who on the installation should work on this project and, once it’s turned over to the partner, some of those people will become the liaison between the garrison and the RCI partner.”

If everything continues as planned, the Assistant Secretary of the Army for Installations and Environment will brief Congress early in 2006 about the privatization. Then it will be the superintendent’s turn.

“In March of 2006, the superintendent will address an industry forum of potential partners and tell them why they should want to take over West Point’s housing,” Kennedy said. “Once a partner is selected, they’ll come here and work directly with the installation on the community development management plan, which is the working agreement between the installation and partner.”

Then, after a 45-day review period, Congress will be asked to put its final approval on the deal. All this should be completed around December 2006, housing officials added.

RCI has already made an impact at other Army installations. More than 50 percent of all Army housing units are under this system and, according to housing officials, it’s been very successful.

However, there are some unique situations here – like historic inventory and limited space for building – that could prove daunting to a potential RCI partner.

“One thing that RCI is very clear on is all the homes, regardless if they are historic or not, will go to the private bidder,” Kennedy said. “Roughly 391 of our homes [40 percent] are historic and we feel that could have an affect on this privatization.”

Historic inventory is the reason Fort Monroe, Va., was not included in the RCI program. Historic homes have to be preserved and contractors are limited in what they can do to them, housing officials added.

“They [RCI partner] may come in with proposals that don’t include historic properties, but the Army’s stance, as of right now, is that they have to take all the housing,” officials said. “To the Army, it’s an all-or-nothing proposition, but the whole beauty of this being a private venture is the partner can come up with what it feels is the best deal to maintain the housing at West Point.”

Overall, Army officials said, RCI benefits all involved because it frees up more money for the Army.

“The Department of Defense wants to privatize as many homes as they can, so they can get out of a business they don’t see as a mission function,” Kennedy said. “They want private people who can do it better while they put their money into fighting the war and training the Soldiers.”