GENERAL SERVICES ADMINISTRATION May 20, 2005

Washington, DC 20504

FMR BULLETIN 2005-B1

DELEGATIONS OF LEASE ACQUISITION AUTHORITY-NOTIFICATION, USAGE, AND
REPORTING REQUIREMENTS FOR GENERAL PURPOSE, CATEGORICAL, AND SPECIAL
PURPOSE SPACE DELEGATIONS

**AGENCY**: General Services Administration

**ACTION**: Notice of Bulletin

**SUMMARY**: SUMMARY: It has been reported recently to Congressional
committees and the General Services Administration (GSA), Public
Buildings Service that some Federal agencies using the delegated leasing
authority issued to Federal agencies on September 25, 1996, as part of
the ''Can't Beat GSA Leasing'' program are not following properly the
instructions specified as a condition for use of the leasing delegation.
The attached bulletin reemphasizes and updates the notification and
reporting requirements specified in the delegation of authority and its
supporting information, GSA Bulletin FPMR D-239 and GSA Bulletin FPMR
D-239, Supplement 1, which are hereby canceled and superseded by this
bulletin. Additional reporting requirements for categorical and special
purpose space delegations are also included. This bulletin is in keeping
with the spirit of Executive Order 13327, ''Federal Real Property Asset
Management,'' in order to maximize the increased Governmentwide emphasis
on real property inventory management. The FMR and any corresponding
documents may be accessed at GSA's website at *http://www.gsa.gov/fmr*.
Click on FMR Bulletins.

**EFFECTIVE DATES**: May 25, 2005.

**FOR FURTHER INFORMATION CONTACT**: For clarification of content,
contact Stanley C. Langfeld, General Services Administration, Office of
Real Property Management (MP), Washington, DC 20405;
*stanley.langfeld@gsa.gov*, (202) 501-1737. Please cite FMR Bulletin
2005-B1.

**SUPPLEMENTARY INFORMATION**: GSA Bulletin FPMR D-239, published in the
Federal Register October 16, 1996, announced a new GSA leasing program
called ''Can't Beat GSA Leasing'' and the delegation of lease
acquisition authority issued by the Administrator of General Services to
the heads of all Federal agencies in his letter of September 25, 1996.
GSA Bulletin FPMR D-239, Supplement 1, published in the Federal Register
on December 18, 1996, issued supporting information for the delegation.

There have been several instances reported of agencies failing to meet
the conditions required for use of the lease delegation:

1.  Several agencies have failed to notify GSA prior to conducting a
    specific leasing action,

2.  Semi-annual performance reports on use of the lease delegation are
    not being submitted to GSA on a regular basis, and

3.  Some agencies have exceeded the authority of the delegation, which
    is restricted to below prospectus level actions.

The following bulletin reemphasizes the above conditions, updates
outdated information and citations, and modifies certain reporting
requirements.

\[**FMR Bulletin 2005-B1**\]

To: Heads of Federal Agencies

Subject: Revised Implementation Requirements of the Delegation of Lease
Acquisition Authority.

1.  *[Purpose]{.underline}.* This bulletin reemphasizes and modifies
    certain procedures associated with the use of the delegation of
    general purpose leasing authority provided by GSA in 1996 as part of
    the leasing program called "Can\'t Beat GSA Leasing," and two other
    longstanding delegations for categorical and agency-specific special
    purpose space as currently provided in 41 CFR 102-73.

2.  *[Expiration]{.underline}* This bulletin contains information of a
    continuing nature and will remain in effect until canceled

3.  *[Background]{.underline}*

    a.  Agencies (without their own independent leasing authority) are
        required to use one of the three types of blanket lease
        delegations offered by GSA: 1) general purpose, 2) categorical,
        or 3) special purpose. The "Can\'t Beat GSA Leasing" program,
        offering the general purpose delegation, was an outgrowth of
        GSA\'s commitment to streamline its leasing operations. Under
        this program, GSA provided each Federal agency a simple choice:
        either engage GSA to provide the most cost-effective and fastest
        service available, or use the leasing authority to perform the
        space acquisition on its own. This bulletin emphasizes the need
        for agencies to communicate with GSA prior to using the general
        purpose delegation for each space action. This bulletin also
        establishes that agencies are now required to submit semi-annual
        reports on their use of any of the three types of blanket lease
        delegations.

    b.  Executive Order No. 13327, "Federal Real Property Asset
        Management" (69 F.R. 5897), dated February 4, 2004, promotes the
        efficient and economical use of Federal real property resources.
        Among other things, the Executive Order requires Federal
        agencies to establish performance measures addressing the cost,
        value, and efficiency of all acquisitions, within the scope of
        an overall agency asset management plan. Agencies using any of
        the three GSA lease delegations are expected to apply these
        measures to their acquisitions.

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4.  *[Action]{.underline}*.

    a.  Pursuant to the authority vested in the Administrator of General
        Services by subsections 121(d) and 585(a) of Title 40 of the
        United States Code, in his letter of September 25, 1996, the
        Administrator delegated authority to the heads of all Federal
        agencies to perform all functions related to the leasing of
        general purpose space for a term of up to 20 years regardless of
        geographic location. Lease procurements using this delegation
        must be compatible with the GSA community housing plans for new
        Federal construction or any suitable space that will become
        available in Federally-controlled facilities. GSA will advise
        the agency about any limiting factors (*e.g.* length of term) so
        that the lease will be consistent with any community housing
        plans. This delegation of authority does not alter the space
        delegation authorities in 41 CFR 102-73 of the Federal
        Management Regulation, which pertain to "categorical" and
        "special purpose" space. It is also important to emphasize that
        none of the GSA delegations provide authorization for agencies
        to conduct procurements on behalf of or to collect rent from
        other agencies.

    b.  *General Purpose Delegation Notification Requirements.* Prior to
        instituting any new, succeeding, or superseding lease action
        under this delegation, the head of a Federal agency or its
        designee shall notify in writing the appropriate GSA, Assistant
        Regional Administrator for Public Buildings Service (ARA/PBS) of
        the agency\'s need for general purpose space and the agency\'s
        intent to exercise the authority granted in this delegation. The
        name of the contracting officer conducting the procurement as
        well as a limited acquisition plan for the procurement shall be
        included in the notice to GSA. The limited acquisition plan must
        meet the requirements specified by General Services
        Administration Acquisition Manual (GSAM), Part 507.1-
        Acquisition Plans. A sample limited acquisition plan is
        available online at *http://www.gsa.gov/leasingform*. The agency
        may exercise the authority contained in this delegation only
        when the ARA/PBS notifies the requesting agency in writing that
        suitable Federally-controlled space is not available to meet its
        space need. If the agency subsequently decides not to exercise
        the requested authority, it must provide written notice of such
        to the ARA/PBS.

    c.  *General Conditions for the use of General Purpose, Categorical,
        and Special Purpose Delegations.*

        1.  Relocation of Government employees from GSA-controlled
            Federally-owned or -leased space may take place when prior
            written confirmation has been received from the appropriate
            ARA/PBS that suitable Government-controlled space cannot be
            provided for them.

        2.  The average net annual rent (gross annual rent excluding
            services and utilities) of any lease action executed under
            these delegations must be below the prospectus threshold.
            The prospectus threshold may be adjusted annually in
            accordance with 40 U.S.C. 3307(g). The current threshold for
            each fiscal year can be accessed by entering GSA's website
            at *http://www.gsa.gov* and then inserting "prospectus
            thresholds" in the search mechanism in the upper right hand
            corner of the page.

        3.  Redelegation of the authority to lease may only be made to
            those officers, officials, and employees fully meeting the
            experience and training requirements of the contracting
            officer warrant program as specified in section 501.603-1 of
            the GSAM.

        4.  Federal agencies must acquire and utilize the space in
            accordance with all applicable laws and regulations that
            apply to Federal space acquisition activities, including,
            but not limited to, the Competition in Contracting Act, the
            Federal Management Regulation, Executive Order No. 12072,
            Executive Order No. 13006, Executive Order No. 13327, the
            Davis-Bacon Act, OMB Circular A-11 (Scoring), and the GSAM.

        5.  Agencies are responsible for maintaining the capacity to
            support all delegated leasing activities, including a
            warranted contracting officer, legal review and oversight,
            construction and inspection management, cost estimation,
            lease management and administration, and program oversight.
            Prior to each leasing action, the agency must conduct an
            assessment of its needs to establish technical requirements
            and the amounts of space necessary to meet mission
            requirements. Additionally, agencies are expected to acquire
            space at charges consistent with prevailing market rates for
            comparable facilities in the community. Accountability for
            all leasing activities shall be coordinated through the
            agency's Senior Real Property Officer.

        6.  GSA retains the right to assess, at any time, both the
            integrity of each individual lease action as well as the
            capability of an agency to perform all aspects of the
            delegated leasing activities and, if necessary, to revoke an
            agency's delegation.

        7.  The general purpose delegation requires agencies to provide
            GSA with leasing performance information periodically. In
            addition, GSA is now requiring agencies to provide lease
            performance information on categorical and special purpose
            lease delegation actions. Accordingly, agencies using any of
            the GSA lease delegations are hereafter required to provide
            GSA with reports semi-annually on April 30 and October 31
            that detail the leasing activities conducted under the
            delegations. Reports should be sent to GSA, Office of
            Governmentwide Policy, Office of Real Property Management
            (MP), 1800 F Street, N.W., Room 6203, Washington, DC 20405.
            Reports may also be sent via e-mail to
            *real.property@gsa.gov*. The reports should contain the
            following information for each currently active and future
            lease executed under the lease delegation:

            a.  Agency/bureau name;

            b.  Property Address---Street address, city and state of the
                leased building;

            c.  Rentable Square Feet (if applicable)---The area for
                which rent is charged (based on the local commercial
                method of measurement;

            d.  Annual Rental Rate per Square Foot---Divide the total
                annual rent by the rentable square feet to obtain the
                annual rental rate;

            e.  Type of Space---General purpose-office, storage, or
                special. If categorical or special purpose, specify
                type;

            f.  Effective Net Annual Rent---The effective net annual
                rent is obtained by dividing the total rent (excluding
                services and utilities) to be paid over the lease term
                (after adjusting for any rent-free periods) by the
                number of years in the lease. Estimated CPI escalations
                and tax escalations are not to be included in this
                calculation. Provide total annual rent for categorical
                or special purpose space where effective net annual rent
                cannot be calculated;

            g.  Lease Term;

            h.  Lease Expiration Date; and

            i.  If the lease is for general purpose space, provide date
                of the ARA/PBS notice stating that no suitable
                Federally-controlled space was available to satisfy the
                space need.

                8.  Agencies using the general purpose delegation are
                    also required to provide the following information
                    to the GSA Regional Office from which the delegation
                    authorization was requested:

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(a) Upon award, provide notification of the award date and location of
    the property, including documentation that the negotiated rental
    rate is within the prevailing market rental rate for the class of
    building leased in the delegated action. The documentation may
    include information from organizations such as SIOR, Black's Guide,
    Torto-Wheaton, Co-Star, etc. If the negotiated rental rate exceeds
    the market range, provide information as to why the market rate was
    exceeded; and

(b) Provide 18 months advance notice of lease expiration if there is a
    continuing need for the space and the agency wishes to use the
    delegation again to satisfy the requirement.

    9.  Agencies using any of the GSA delegations are responsible for
        observing the above rules and conditions. Improper use of the
        delegations may result in revocation of the delegation.

        d.  Further information regarding this program may be obtained
            by contacting the General Services Administration, Office of
            Real Property Management on (202) 501-0856.

/s/

G. Martin Wagner,

Associate Administrator for Governmentwide Policy.