EDITORIAL
Military building boom may come at a price

There's been almost universal euphoria about billions of dollars in "privatized" military contracts recently authorized to repair, renovate or build housing for the armed forces here.

The huge contracts are seen as a major boost for the local economy, offering jobs and opportunities for everyone from construction workers to architects and engineers.

And that promise is likely to remain fulfilled.

But U.S. Rep. Neil Abercrombie, who helped write the federal law that opened the door to this huge privatization program, charged last week that the promised boom might come with an unexpected price.

As reported by staff writer Jim Dooley, Abercrombie says the private contractor, Actus Lend Lease LLC of California, now wants hundreds of millions of dollars in tax breaks from the city and state as a condition of moving forward with its $1.7 billion housing project.

The idea is that since the housing is for the federal government — the military — it should be exempt from state excise taxes and city property taxes.

Abercrombie charged that the proposed tax relief is simply a form of "extortion" designed to offset the cost of a low bid.

Through a spokesman, the company says it is not after extra profits. If it gets the tax relief, it says, it will plow the money into speedier construction and more "amenities" in the military housing areas.

This adds up to two rather starkly different views of the situation.

At a minimum, someone — perhaps Abercrombie — should call for a General Accounting Office audit of precisely what was called for in the original bid and what was promised by the contractor.

A question as major as this — whether the multibillion-dollar project would be subject to local taxes — should not have been left to ambiguous interpretation.

If the tax break is what Abercrombie suggests it is, a bailout, then local authorities should resist going along.

And if it is as the company suggests — a way to speed up construction and add amenities that would otherwise not be offered — then a new question arises.

Should local taxpayers, city and state, be asked to underwrite a ramped-up construction schedule and "amenities" for military housing?

There would still be benefits, including jobs and other economic activity, that would accrue even with the tax breaks. But policy-makers will have to take a hard look at how much the state and county should have to pay to enjoy this "boom."