Managing Federal Real Property

Why It's High Risk

Managing Federal Real Property

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The federal real property portfolio is vast and diverse. It totals over 900,000 assets with a combined area of over 3 billion square feet. The Departments of Defense and Veterans Affairs, the U.S. Postal Service, and the General Services Administration (GSA) hold the majority of federally owned and leased space. Progress has been made on many fronts, including significant progress with real property data reliability and managing the condition of facilities, which GAO found to be sufficiently improved. However, agencies face long-standing problems with overreliance on leasing, excess and underutilized property, and protecting federal facilities.

^ Back to topWhat We Found

Since GAO first designated real property management as a high-risk area in 2003, the government has made progress in many aspects of real property management.

• The 2004 Executive Order 13327 established the Federal Real Property Council (FRPC), composed of representatives from real property-holding agencies, to promote reform efforts. The FRPC and the GSA established the Federal Real Property Profile (FRPP) a centralized real property database, and agencies have developed asset management plans, standardized data, and adopted performance measures.
• Two consecutive administrations have demonstrated commitment to this issue. Most recently, a June 2010 presidential memorandum directed agencies to identify and eliminate excess properties to produce a $3 billion cost savings.
• GAO found real property data reliability is no longer high risk due to improvements in FRPP data reliability due to the Office of Management and Budget’s (OMB) leadership, along with GSA data controls and data verification plans developed by agencies.
• GAO also found managing the condition of facilities is also no longer high risk, due to improved FRPP data and agency procedures to prioritize and manage repairs and maintenance.

While progress has been made, certain long-standing problems remain.

• OMB has not developed a corrective action plan to address the fact that agencies increasingly rely on leasing. GSA, as the government’s principal landlord, now leases more than it owns.
• Despite efforts to dispose of unneeded assets, a large number of excess and underutilized assets remain. According to FRPP data, in fiscal year 2009, agencies reported 45,190 underutilized buildings, an increase of 1,830 such buildings from the previous fiscal year. These properties are costly to maintain. For example, in fiscal year 2009, agencies reported underutilized buildings accounted for $1.66 billion in annual operating costs.
• As GAO has reported over the years, attempted corrective action measures have not addressed the root causes which exacerbate these problems, such as various legal and budget-related limitations and competing stakeholder interests.
• The Federal Protective Service has experienced management and funding challenges that have hampered its ability to protect about 9,000 federal facilities.

^ Back to topWhat Needs to Be Done

Improved FRPP data now allows for the measurement of governmentwide progress. Other actions are needed to address root causes. GAO has recommended that OMB develop a strategy to address the continued reliance on leasing in cases where ownership would be less costly. OMB should develop an action plan to address key problems associated with disposing of unneeded property, including reducing the effect of competing stakeholder interests on real property decisions. Also, to better protect facilities, the Federal Protective Service should develop a more comprehensive program to assess risk and allocate resources.

^ Back to topKey Reports

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