Local builders get challenge

Ask builders to tell you things they worry about, and you'll hear rising materials cost, government regulation, labor problems, the weather.

They may need to start worrying about a giant sucking sound from national competition.

At the recent kickoff of the Augusta Homebuilders Association Showcase of Homes, one of the builders told me we're fortunate that the home-construction business is all local.

With the exception of a couple of niche operators, home construction companies are locally owned and operated. Whether you love them for the homes they build or hate them for suburban "sprawl," at least their profits stay here.

That could change starting next year - courtesy of the federal government.

At this past Tuesday's Chamber breakfast, representatives of GMH Military Housing, part of a Pennsylvania-based real-estate management company, highlighted a new contract to build, renovate and "convert" 887 housing units at Fort Gordon.

The construction work will be handled by Centex, a gigantic home-construction, mortgage and insurance corporation. The company, which recently reported $3.24 billion in quarterly revenue, touts itself as "among the largest multi-market, single-family home producers in the United States."

Fort Gordon's deal with GMH, Centex and architect The Benham Companies, Inc., represents a 50-year contract, says Harry Bloomer, the project director and past and current Columbia County resident. A GMH press release prices the first six years of the project at $148 million.

It will be a remarkable and badly-needed transformation for Fort Gordon soldier housing, most of it built at least 30 years ago. The new and renovated homes, duplexes and townhomes largely will compete with the rental market, so local new-home builders aren't worried about losing market share to the project.

Here's what makes them nervous, though. While thousands of homes are being built in Columbia County, the market hasn't yet attracted the big corporate construction companies, such as those building in Atlanta and Savannah.

The Fort Gordon project could change that. It will bring Centex to our doorstep, and once the nationwide company has a local network of suppliers and subcontractors, their next logical step would be to expand to other construction projects in the area.

Even before that happens, though, the project could pinch local builders. One, Jake Ivey, asked Bloomer whether Centex would have to follow federal Davis-Bacon wage rules because the project is taking place on federal property. Bloomer didn't know the answer, but it's probably yes.

The Davis-Bacon Act was passed in 1927 by racist lawmakers who wanted to keep low-wage blacks from competing with white workers, writes George Mason University Law Professor David Bernstein. The law - which should have been repealed 10 seconds after Republicans took over Congress - is now a union-labor protection racket that requires federal projects to pay local workers "prevailing wages," meaning higher union scale.

The builders fear that some of their best-skilled workers, already in scarce supply, could be siphoned off by the higher-wage, federally funded Fort Gordon project.

Losing subs will be the first challenge, but it won't be nearly as big a problem as losing a share of the local home-construction market to a national builder. This deal will be wonderful for Fort Gordon and its soldiers, but local builders had better be worried.

Mythology says a vampire can't come into your home unless you invite him in. Uncle Sam may have just set out our community's welcome mat.

(Barry L. Paschal is publisher of The Columbia County News-Times. E-mail comments to barry.paschal@newstimesonline.com.)