**MINUTES**

**BUREAU ASSET MANAGERS FORUM**

**AUGUST 7, 2001**

**METROPOLITAN SQUARE**

**6^th^ FLOOR BOARD ROOM**

**10:00AM - 1:45AM**

**[PURPOSE:]{.underline}**

This is our third quarterly meeting. The purpose of the meeting
primarily is to present the capital asset managers review and other
related processes and a strategy, the share-in-savings concept for
acquiring assets.

**[DISCUSSION:]{.underline}**

The agenda for the meeting consists of the Office of Asset Management
Study, General Services Administration (GSA) Rental Space Location
Availability, Share-in-Savings Pilot, Personal Property Program Staff
Visits, Strategic Asset Management Plan, Office of Management and Budget
Capital Planning, Capital Investment Review Process, and Business Case
for the Secret Service Rowley Training Center Dormitory.

Carolyn Austin-Diggs began by thanking everyone for coming and gave a
brief overview of what was discussed at the last meeting.

[GSA Rental Space Location Availability]{.underline} -- Carolyn
mentioned that the tour was sponsored by the Federal Real Property
Executive Interagency Advisory Group. The purpose of this District of
Columbia (DC) State of the Market Tour was to review available space for
expansions and relocation. There were participants from DC Office of
Planning, Downtown Action Planning Group, Anacostia Waterfront
Initiative Zoning and Special Projects Office, Business Development --DC
Marketing Company and the Assistant Regional Administrator-GSA National
Capital Region. Carolyn said GSA is looking toward outside locations of
the DC area for space because of cost considerations.

The bus tour guided through the DC area surrounding the development in
downtown/North Massachusetts, Mount Vernon Triangle, and the North
Capital Corridor. For the new convention center, approximately three
redevelopment schemes were identified: 1) convention hotel/department
store, 2) luxury hotel/more housing, and 3) luxury hotel/more retail.
The District of Columbia has several key goals: increase residences by
about 2100 new units for \$30 million, increase retail by about 1
million square fee for \$50 million, increase to 1500 new hotels room
for about \$12.5 million and increase office space for 3.5. to 5.0
million square feet for about \$20 million. For the District of Columbia
there were several issues: downtown is approaching build-out, sites for
office development is limited, parking is difficult, open space, streets
and buildings need improvements, and new convention center requires
hotels.

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[Office of Asset Management Study]{.underline} -- Carolyn mentioned that
the study was being completed. In fact the data-gathering task had been
completed. A draft compilation of the analysis of the
questionnaires/surveys from the bureaus was expected within the next
couple of weeks. From the data analysis phase, seven questions had been
asked regarding the portfolio, nine questions on the life cycle
analysis, four questions regarding the portfolio of assets funded,
including automated systems, and two questions regarding the
environment, safety, historic preservation. There is an approximately
1.7 billion expended on real property and \$1.5 billion expended on
personal property. It is her intent to share the results of the study
with the bureaus as soon as the report could be finalized.

[Treasury Share-in-Savings]{.underline} -- Garland stated that the
purpose of the pilot was to deliver to bureaus a management system or
process that allows the bureau to acquire and manage major assets, with
efficiency and confidence required to do the best job possible. Garland
mentioned that the Share-in-Savings is a Special Contracting and Funding
Strategy that the bureaus would have to approve for their use. Garland
mentioned that with the Share-in-Savings the contractor assumes 90% of
the funding risk. We are seeking a pilot for the bureaus to participate
on a volunteer basis. Programs appropriate for a Share-in-Savings
contract include facility maintenance, infrastructure management, and
management of real property. Garland said he would report the results of
the pilot as it becomes available.

[Personal Property Assistance Visit Program]{.underline} -- Carolyn
mentioned that at the May meeting there had been a presentation on the
program. There had been concerned expressed about the use of the
program. Three bureaus met with the Office of Asset Management
\[Internal Revenue Service; Alcohol, Tobacco and Firearms and U.S.
Secret Service\] and as a result, four other alternatives had been
proposed for the assistance visits, (1) a self-assessment, (2) case
study presentations at the Asset Management meetings, (3) policy reviews
of bureau personal property program by the Office of Asset Management
and (4) assisted self-assessment of the property program by the Office
of Asset Management. These alternatives were prepared in a questionnaire
asking for five additional ideas. Responses from the bureaus were to be
received by August 24^th^.

[Strategic Asset Management Plan]{.underline} -- Carolyn mentioned that
from an overall planning perspective, non-information technology assets
need to have a strategic plan to set the direction for Treasury and its
bureaus regarding the future investment of these asses, for there are
billions of dollars expended on these asset. She has asked for a few
bureaus to participate in developing an approach to prepare the plan. It
is the intent that all bureaus participate as well as other stakeholders
and customers in the process.

[OMB Capital Planning]{.underline} -- Recently the Office of Management
and Budget held a meeting on July 19, to discuss the capital planning
and investment control processes and budget reporting. It focused on OMB
Circular A-11, Preparation and Submission of Budget Estimates,
particularly Exhibit 300 \[renamed from exhibit 300B\]. OMB stated that
the 'heart' of capital planning is the business case. It is important to
keep the capital asset plans current after the presidential budget

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decisions are made. A couple of changes will be occurring particularly
and initially for information technology assets and subsequently to
non-information technology asset, 1) there will be evaluations performed
on the annual reviews by the CIO program office 2), the Inspector
General will perform independent evaluations of subsystems. Via OMB
oversight responsibilities, if a weakness is identified as a result of
the reviews, the agency must provide a milestone plan to address the
weakness and include in the Exhibit 300.

[Capital Investment Review Process]{.underline} -- Kay mentioned that
the Capital Investment Review Board has been in existence for a few
years. She distributed a copy of the existing portfolio of both
information technology and non-information technology assets as well as
the charter for the Board. She mentioned that as bureaus, often times if
they have a capital asset over a certain dollar threshold, they will be
asked to provide a presentation to the Board, to seek approval of the
proposal from an investment perspective. Kay stated that her office is
responsible for assisting the Chair of the Board in meeting proceedings
and with the bureaus in the preparation of their presentations. Once a
proposal has been approved then that bureau is asked to provide updates
on a semi-annual basis.

[A Business "Case" Study on the James J. Rowley Training Center
Dormitory]{.underline} -- Don Odgen stated that the U. S. Secret Service
had a need for a dormitory to accommodate its students to

address the frequent shortages of hotel availability and increase time
students have to allocate to training. Don stated that the proposed dorm
has 200 rooms. He mentioned that from a case history perspective, the
dormitory proposal was presented to the TIRB in 1999. In June 2000 a
briefing was presented tot he CIRB. In December 2000 a final briefing
was given to the CIRB. Don stated that the CIRB approved the case in
January of 2001 and a progress report was done in June 2001. He said
that the cost would be \$16 million to maintain the dormitory and the
associated benefits cost \$25 million.