News Articles

Vicki Needham

Two senators are pressing federal agencies to outline their plans to sell off unneeded real estate in an effort to cut spending and save money.

Sens. Tom Carper (D-Del.), chairman of Homeland Security and Governmental Affairs Subcommittee on Federal Financial Management, and Rob Portman (R-Ohio), former director of the Office of Management and Budget, sent letters on Wednesday to eight federal agencies requesting information on real property disposal initiatives.

"Looking ahead, it's critical that agencies come up with innovative property management tools to expeditiously dispose of assets they no longer need and take better care of those that they do need," the senators said in the letters.

"By disposing of unneeded buildings, reducing maintenance costs, and consolidating and re-aligning existing space, we can save taxpayer dollars and make government work better for everyone."

Carper, whose panel held a hearing last month, and Portman are asking the agencies to provide details on their property management overhaul efforts, including properties previously identified as excess or underutilized and properties previously sold. They also asking for any plan to reduce the costs of owned and leased property.

The senators sent letters to the General Services Administration, and to the departments of Veteran Affairs, Energy, Interior, Justice, State, Agriculture and Homeland Security.

In May, a House subcommittee approved a bipartisan measure that would set up a framework to identify and decrease the federal government's real estate holdings, saving an estimated $15 billion over three years.

Bill sponsor, Rep. Jeff Denham (R-Calif.), chairman of the House Transportation and Infrastructure Subcommittee on Economic Development, Public Buildings and Emergency Management, has been working with the Obama administration on a plan to create a civilian version of the Defense Base Closure and Realignment Commission (BRAC) that led to the closure more than 350 installations between 1989 and 2005.

The bill calls for the formation of an independent commission that would review federal properties and make recommendations for consolidations, co-locations, redevelopment, selling or other actions to minimize costs and produce savings for the taxpayer.

During the past eight years there have been several efforts to identify and reduce the federal government's real estate holdings as a way to cut spending.

"In January 2003, the Government Accountability Office first placed real property management on its list of "high risk" government activities, citing significant amounts of underutilized and excess property and an over-reliance on costly leasing," the letter said.

In 2004, President George W. Bush directed agencies to develop plans to determine whether real property holdings were sufficient or in excess of what they need.

In June 2010, President Obama directed the agencies to accelerate efforts to remove excess and surplus property and to achieve $3 billion in savings by the end of fiscal 2012.

At a June 9 Senate hearing, OMB Controller Daniel Werfel testified that the government can't continue operating with costly real property inventory and "suggested reducing costs by consolidating sites across federal agencies and closing field offices where possible," the letter said.

"Holding on to considerable amounts of excess property often translates into significant costs for their operation, maintenance and security," the letter said.

On May 4, the administration released a list of 14,000 buildings and structures that have been designated as excess property and 45,000 underutilized buildings that cost more than $1.7 billion annually to operate.

Federal agencies have reported leasing nearly 635 million square feet of building space with total annual operating costs of $8.1 billion in fiscal year 2009.

While leasing may be economically advantageous in meeting temporary or short-term space needs, building ownership has been proven to be more cost effective in meeting long-term space needs in most instances, the letter said.

The federal government owns and operates more than 1.2 million buildings at a cost of about $20 billion a year.