Administration seeks help in selling off excess federal buildings
On Wednesday, administration officials announced the formation of an independent advisory board that will examine the status of 14,000 vacant government buildings and 55,000 other facilities considered underutilized. The facilities are run by 24 agencies, costing a combined $1.8 billion to operate and maintain, according to an October 2010 report by the General Services Administration's Federal Real Property Council.
The new Civilian Property Realignment Board would consist of seven members appointed by the president, including one chairperson, according to the White House's fiscal 2012 budget proposal. The panel, whose members have not been selected, will have three years to make its recommendations, which would come after consultation with federal agencies and after public hearings.
"Too often, these political interests slow down, or in some cases, completely stop the effort to get rid of unnecessary properties," said the administration Chief Performance Officer Jeff Zients during an appearance at the White House press briefing on Wednesday. "I think by bundling the properties and going above the local interests, we'll have much more success in getting these properties to market."
First highlighted in Obama's State of the Union address in January, the plan could save taxpayers up to $15 billion over three years, the administration said. At least 60 percent of the net proceeds would go into the treasury for deficit reduction, the budget proposal said. The remainder of the money would be kept by agencies to reinvest in real property management, or directed to a fund to help dispose of the excess property. It is not clear how those funds would be divided.
"Billions of dollars of savings can be realized through the sale or consolidation of these properties," an administration official said. "For too long, red tape and politics have prevented the government from moving forward on these fronts."
The advisory board's meetings, with the exception of those discussing classified facilities, would be open to the public. The panel's conclusions and recommendations then would be posted on a federal website. An interim report would be issued four months after the panel's launch.
Within 25 days of receiving the board's final recommendations, the director of the Office of Management and Budget will tell Congress whether the White House supports the proposals. If the plan is approved, it will head to Congress for an up-or-down vote. If OMB rejects the proposal, the board will have 10 days to submit revised recommendations.
Congress then would be required to vote on the entire package of recommendations, with no amendments allowed, the budget proposal said.
The board would be modeled after the Base Realignment and Closure Commission, several iterations of which have reviewed and voted on Defense Department recommendations for closing or reconfiguring military bases. The latest BRAC report was finalized in 2005.
The announcement was welcomed by Sen. Tom Carper, D-Del., who has long pushed for the disposal of excess federal property.
"As our nation's largest property owner and energy user, it is critical that agencies remain vigilant in identifying ways to improve the way federal property is managed," said Carper, who chairs the Senate Homeland Security and Governmental Affairs' Subcommittee on Federal Financial Management. "Unfortunately, our failure to effectively manage our assets and agencies' tendency to hold on to property they no longer need costs us millions of dollars every year."
Carper plans to introduce legislation in the coming weeks that would give agencies additional tools and incentives to sell off excess property. The legislation would streamline many of the antiquated -- and, critics suggest, cumbersome -- rules in the current buildings disposal process.
"The government has many excess and underutilized properties that cost billions of dollars each year to maintain," Carper said. "Despite efforts to reduce this inventory, multiple obstacles remain that preclude quick and easy solutions. Until these obstacles are overcome, this issue will remain high risk."
The bill would allow agencies to keep all the proceeds from building sales -- a provision that could prompt opposition from Republicans who likely would want any savings used to pay down the deficit.
The plan is not the Obama White House's first foray into the complicated and often opaque world of federal real estate disposal. In June 2010, Obama issued a memorandum instructing agencies to speed the process of eliminating surplus property and to do more with existing assets. Agencies also were instructed to look at utilization and occupancy rates, annual operating cost, energy efficiency and sustainability. The memo set a governmentwide target of $3 billion in savings by the end of fiscal 2012.
But the empanelling of a new advisory panel indicates a new direction. "This approach will enable us to cut through the red tape and overcome the special interests and parochial politics that have traditionally slowed or halted progress when efforts have been made to reduce government's real estate footprint one asset at a time," the administration official said.
The administration wants Congress to appropriate funds for the board's salaries and expenses. If not funds are allocated, OMB will provide the board up to $8 million from unobligated amounts in accounts of federal land-holding agencies, the budget proposal said.
In total, the federal government owns roughly 1.2 million buildings and facilities, with an operating and maintenance budget of about $19 billion, according to OMB. The Federal Real Property Council report said the government actually added thousands of new buildings in fiscal 2009.