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Sitting On Our Assets

The United States government has no idea how much real property it holds that is unused or underutilized and could be sold or transferred, according to a government audit.

The Government Accountability Office report, released last week, details how the Federal Real Property Council, charged with maintaining a database of property held by the government, is so full of inconsistencies and inaccuracies as to be nearly useless for its purpose of identifying real estate that could be better utilized or disposed of.

The GAO report found that 23 of the 26 sites it examined differed significantly from the Federal Real Property Profile database, not only in their actual condition but in their value, actual utilization and necessity to the government’s missions.

For example, 21 of the 26 buildings were in need of more repair than the database indicated. The agencies did not report the costs of repairing many of the buildings because they had no plans to do so, and as a result the database reported them in 100% or perfect condition.

In addition, the reported utilization of many buildings varied dramatically from what investigators found on site visits. One building reported as fully utilized was fully utilized only by rats and beehives and was otherwise unused. An office building reported as empty one year and 59% utilized the next turned out to be only about 10% utilized during both years, according to the officials actually in the building.

The report comes just as the House Transportation and Infrastructure Subcommittee on Economic Development, Public Buildings and Emergency Management held one of a series of field hearings in vacant federal property.

At last week’s hearing, held in an abandoned heating plant that had not been used in a decade, subcommittee chairman Rep. Jeff Denham, R-Calif., plainly told a General Services Administration official, “you’re not doing a good job” disposing of unneeded real estate.

True to form, Flavio Peres, GSA’s deputy assistant commissioner for real property utilization and disposal, claimed the building “is an example of GSA’s successful management of our assets and our ongoing efforts, in line with administration goals, to better utilize federal real property.” GSA had not begun work to sell the building, located in “pricey” Georgetown, until November 2011, and expects it to actually go on sale in September.

“We have moved aggressively to right size our portfolio,” Peres further joked.

To be fair, it isn’t entirely the GSA’s fault. Many of the buildings at issue are controlled directly by the various federal agencies, rather than GSA. And selling the properties has its own set of obstacles, most of them legal. Repairing the property to make it usable, or in the case of the Department of Energy, cleaning up the radioactive waste, can cost more than the property is worth. Agencies also have to consider the environmental impact of disposing of property, and if it’s a historic site, or even eligible to be designated one, then it gets really complicated. And sometimes the people in the buildings just don’t want to move.

GAO recommended that the Office of Management and Budget develop a national strategy for managing excess and underutilized property and that GSA improve the FRPP database so that it’s actually useful.

That could take a while. In the meantime, Denham’s Civilian Property Realignment Act of 2011, meant to streamline the process of selling excess government real estate, has passed the House but stalled in the Senate. The bill follows a 2010 report, Sitting On Our Assets, which identifies hundreds of billions of dollars in potential savings through better management of federal assets and reduction of waste.

One Response

  1. Mark Faring

    A clear example of how these federal employees are completely unqualified to earn their jobs. Peres is a real joke and a clear example of an incompetent that just wastes our tax payer’s money. Our ROA are the lowest they have been in decades. Denham should remove all these fools from the government.

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