Sen. Carper Highlights Need to Save Taxpayer Dollars through Better Management of Federal Property

WASHINGTON – Sen. Tom Carper (D-Del.), Chairman of the Senate Subcommittee on Federal Financial Management, Government Information, Federal Services and International Security, recently wrote to the Office of Management and Budget (OMB) urging the Administration to put together a plan detailing its strategy to dispose of excess and surplus federal property in an effort to decrease the burden placed on taxpayers for maintaining these underutilized government assets. 

"As the country’s largest property owner and energy user, it is critical that the federal government remains vigilant in identifying ways to improve the management of its real estate portfolio," said Sen. Carper. "Through my work on the Homeland Security and Governmental Affairs Committee, I’ve learned that the property management is one of the most pressing and costly management problems facing federal agencies today. Unfortunately, the federal government’s failure to effectively manage and sell unneeded property ends up costing Americans millions of dollars every year." 

In his letter, Sen. Carper cited recent media reports, including an article published by The Washington Post, which highlighted the magnitude of this problem. The federal government owns more than 1.2 million facilities, 70,000 of which are underutilized or vacant, at a total cost of $19 billion in annual operating expenses. Retaining properties that are no longer needed costs taxpayers $119 million every year in security, maintenance and utility costs. Another report, written by the House Committee on Transportation and Infrastructure, indicated that selling 20 percent of the federal government’s nonperforming real estate assets could translate into an estimated savings of $2 billion for taxpayers.

A copy of Sen. Carper’s letter follows: 

November 10, 2010 

Mr. Jeffrey Zients 

Acting Director 

Office of Management and Budget 

725 17^th Street, NW

Washington, DC 20503

Dear  Mr. Zients: 

As the country’s largest property owner and energy user, it is critical that that the federal government remain vigilant in identifying ways to improve the way the federal government’s real property portfolio is managed.  Through my work on the Homeland Security and Governmental Affairs Committee, I’ve learned that property management is one of the most pressing management problems facing agencies today.  Unfortunately, our failure to effectively manage that property and agencies tendency to hold on to property they no longer need costs us millions of dollars every year.

To understand the magnitude of this problem, please consider the following data.  According to a recent article published by the Washington Post, the federal government owns more than 1.2 million facilities at a total cost of $19 billion in annual operating expenses.  Of these assets, nearly 70,000 are underutilized or vacant.  I’m told that holding on to these properties costs taxpayers $119 million in annual operating expenses, such as security and maintenance costs.  For example, the Department of Veterans Affairs annually spends $35 million to maintain unneeded facilities.  A recent report written by the House Committee on Transportation and Infrastructure indicates that selling twenty percent of the federal government’s nonperforming real estate assets could translate into an estimated savings of $2 billion for taxpayers. 

That said, I’m certainly encouraged by the Post’s reporting on the administration’s plans to accelerate efforts to remove excess and surplus property for a savings of $8 billion in the next two years.  However, I ask that you reply to this letter with a detailed plan as to how the administration plans to reduce, sell, or reallocate these assets, thereby lessening the heavy burden placed on taxpayers for maintaining these underutilized facilities. 

In addition, please let me know if there are any legislative changes or additional authorities that you believe would help you achieve your goals in this area. 

With best personal regards, I am

Sincerely yours, 

Tom Carper 

U.S. Senator