"This report describes the Military Housing Privatization Initiative (MHPI), a pilot program authorized by Congress in 1996 to encourage privately-funded development of housing for use by members of the U.S. Military Services (including the Army, Navy, Marine Corps, and Air Force). The quality of housing available to members of the Military Services is considered one of the most important components (along with pay and quality of workplace) in defining the military's 'quality of life,' directly influencing the ability of the Military Services to retain personnel on active duty. As part of the Department of Defense (DOD) effort to address its housing problems by a self-imposed deadline of 2010, the MHPI uses private sector alternatives to military housing construction, 'leveraging' appropriated funds by providing federal supports to commercial real estate developers. Congress temporarily granted DOD 12 of these risk-reducing authorities, including the ability to convey or lease public property to private enterprise, to guarantee minimum occupancy rates, or to offer direct loans to real estate developers. While the Office of the Secretary of Defense retains general oversight and approval authority, the individual Military Services are responsible for the execution of projects on military installations. […] Domestic military housing is created through three methods: access to the civilian housing market, traditional military construction using appropriated funds, and MHPI development. More than 66% of Service members stationed within the United States use commercial housing. MHPI housing currently under contract or in solicitation accounts for less than 20% of the remainder, with military construction supplying the rest. DOD intends to resolve its housing shortfalls through a combination of those three alternatives."
CRS Report for Congress, RL31039