A Control Yuan report urged the Friends of the Armed Forces Association to sign rental contracts with the Ministry of National Defense as soon as possible, otherwise the association would be suspected of illegally occupying state-owned land and buildings.
The association was founded in 1951 to perform charitable work related to members of the armed forces, but today is known mainly for the Hero House chain of hotels and a restaurant it operates nationwide.
Three of the nine Hero House establishments — in Taipei, Taichung and Kaohsiung — occupy land and buildings that are registered to the ministry, even though registrations also exist under the association’s name, the report said.
Under the National Property Act (國有財產法), state-owned buildings should be used by the agencies to which they are registered, but buildings can be leased to select entities if necessary, as long as their use does not violate their original purpose.
While the association and the ministry have standing rental contracts for the land, they have not signed rental contracts for the buildings, the Control Yuan said.
Although the Hero House establishments offer room and board to officers, soldiers, veterans and their families, they are not registered as hotels, the report said.
The ministry should advise the association on how to improve its operations and protect the rights of its clients, the Control Yuan said.
The Control Yuan has launched an investigation into the association due to accusations that it was renting land from the ministry at unfairly low rates, it said.
Pundits have said the association might become the next target of the Ill-gotten Party Assets Settlement Committee.
Last month, the committee declared the National Women’s League a Chinese Nationalist Party (KMT)-affiliated organization, thus subjecting it to the controversial Act Governing the Handling of Ill-gotten Properties by Political Parties and Their Affiliate Organizations (政黨及其附隨組織不當取得財產處理條例).
The association yesterday said talks with the ministry were ongoing and that contracts would be signed after administrative procedures have run their due course.
It has ownership rights to establishments in Yilan and Chiayi and standing rental contracts with local governments in Hualien and Penghu counties and Tainan and Taitung, it said.
The association “would pay whatever money needs be paid,” a source said.
The ministry said the association paid to renovate the three establishments in question, while the ministry’s name was used on the paperwork to facilitate construction projects on ministry-owned land.
The ministry is still finalizing a contract that would allow the association to use the buildings for free, it said, adding that this explains the lack of contracts.
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