OMB touts progress on reducing federal property footprint

 Controller Danny Werfel Controller Danny Werfel Caitlin Fairchild/Govexec.com

The White House on Thursday announced new progress in the Obama administration’s effort to save money by consolidating and selling off unneeded federal real estate.

Through the first quarter of fiscal 2012, agencies saved $5.6 billion in property costs and were “on track” to exceed President Obama’s goal of saving $8 billion by year’s end, Controller Danny Werfel said in a blog post.

In response to Obama directives and the ongoing Campaign to Cut Waste, “agencies have worked to reduce office space, encourage wider adoption of telework, provide alternate workspace configurations, reduce operating costs and consolidate data centers,” Werfel wrote. “Through these efforts, agencies have generated millions of dollars in savings from selling or consolidating properties, on top of numerous examples of lease cancellations, improved space management, and reductions in operating costs that are driving greater returns for the taxpayer.”

Werfel pointed to the recent closings of 43 small offices by the Internal Revenue Service and the shuttering of 259 offices, facilities and labs by the Agriculture Department, which together will save some $190 million annually.

As examples of obsolete properties removed from federal responsibility, he mentioned the recent sale of the General Services Administration’s 1958-vintage Nome Federal Building in downtown Nome, Alaska, for $1.68 million, as well as a radar site in Moscow, Maine. The government also is preparing to sell the Portland Custom House in Portland, Ore., he added, which could generate as much as $4 million.

Efforts to unload unneeded federal properties are complicated by a weak economy, legal claims of first-refusal rights to properties by advocates for the homeless and historic preservation groups, as well as the agendas of local and national politicians.

Congress is mulling bills to reform the property sale process. The Office of Management and Budget has proposed legislation to create an outside board of property experts who would bundle properties for sale after congressional approval, much like the Defense Department’s Base Closure and Realignment Commission. A bill with some similar provisions introduced by Rep. Jeff Denham, R-Calif., cleared the House in February but is stalled in the Senate.

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