Deal guarantees unions will work on Army housing

By Jim Dooley
Advertiser Staff Writer

The company in line for a 50-year contract to modernize and maintain 7,800 U.S. Army housing units on O'ahu has signed a labor agreement, reached after a week of negotiations with organized labor and praised by Hawai'i's congressional delegation and local union officials.

Ryan Mielke, spokesman for Actus Lend Lease, the California-based company that has won preliminary approval for the multibillion-dollar housing privatization contract, said last night the agreement "essentially guarantees that we will be working with union labor and union businesses over the life of the contract."

Mielke said non-union companies and workers also "will be included in the work — they will be allowed to bid on projects."

Peter Koziol, Actus' chief executive officer, said the agreement "goes a long way toward ensuring a high-quality and balanced work force for the project." He said in a press release it "ensures a fair, competitive environment that provides best value to our military families while maximizing the hiring and utilization of Hawai'i's construction workers."

U.S. Rep. Neil Abercrombie, who has been an outspoken critic of tax exemptions proposed in the privatization contract, and who pushed to include organized labor in the project, said the agreement "ensures that work in Hawai'i will be done by Hawai'i people."

In an apparent reference to property and general excise tax exemptions Actus is seeking from the city and state, Abercrombie said, "Now we can move on to other outstanding issues."

George Paris, president of the Hawaii Building & Construction Trades Council, called the agreement unprecedented.

"Never before has any company forged a collective agreement with the unions of an entire industry for such a long period of time, with assurances of fair wages and benefits built in for coming generations of workers in Hawai'i," he said.

At the height of the construction phase, Actus said, it expects to employ more than 500 Hawai'i workers, with about 30 to 50 local companies as subcontractors.

Actus and the Army are ironing out an overall plan for the repair and rehabilitation of Army housing units on O'ahu and the construction of new housing.

Once that plan is accepted by the Army, it will be forwarded to Congress for approval, followed by formal signing of the contract with Actus. The company said the contract would be worth about $1.7 billion during the initial 10-year construction and development phase, and $5.1 billion over the life of the agreement through 2054.

The Army has said it wants to resolve whether Actus will receive property tax exemptions from the city and general excise tax exemptions from the state before the agreement is submitted to Congress. Last week, Army officials said they planned to have the final contract signed by Oct. 1, but that may be delayed by the tax issues.

In the meantime, the Army has awarded Actus a four-month, sole-source contract worth $13.5 million to manage and maintain existing Army housing here. The contract, which begins next month, replaces two housing maintenance contracts with other companies.

U.S. Sen. Dan Inouye said yesterday's agreement came amid tough negotiations, but "when people of good intentions come forward, a meeting of the minds was sure to occur in the best interest of Hawai'i's working tradesmen and women and for our Army 'ohana in Hawai'i."

Reach Jim Dooley at jdooley@honoluluadvertiser.com or 535-2447.