# Presentation: 721242

## Real Property Asset Management

**Eduard A. Dailide, P.E.**
**Deputy Director, Facilities and Infrastructure**
**Office of Engineering and Construction Management**

**February 19, 2004**

## DOE Real Property Portfolio 

- Land		2.6 Million Acres (Yucca may add 0.75-0.5M)
- Buildings
- Owned		127.0 million Gross Sq Feet
- Leased                      24.0 million Gross Sq Feet
- Laboratories	  30.5 million Gross Sq Feet
- Production 	  44.6 million Gross Sq Feet
- Office		   17.47million Gross Sq Feet
- Total Replacement Value of Improvements $73.1 Billion
- (Not including land)
- Annual Facilities and Infrastructure  budget over $3 billion

## Perspectives

- Weakness in the acquisition and management of the Department’s real property assets have been highlighted by:
- Congress
- General Accounting Office
- National Academies of Sciences and Engineering
- DOE Inspector General

## GAO Reports

- GAO-03-122, Jan 2003, places Federal Real Property as a High Risk Area due to:
- Deteriorated and outdated property portfolio
- Excess and underutilized inventory
- Lack of quality facility data
- No comprehensive and integrated planning
- GAO-03-100, January 2003, Major Management Challenges and Program Risks, Department of Energy
- DOE faces major challenge in revitalizing infrastructure

## Facility Data

**FY 2003 was funded **
**at 1.2% of RPV**

## Departmental Responses

- Issued:
- DOE Order 413.3*, Program and Project Management for the Acquisition of Capital Assets, *October 13, 2000
- DOE Manual 413.3-1*, Project Management for the Acquisition of Capital Assets, *March 28, 2003
-  DOE Order 430.1B, *Real Property Asset Management (RPAM), *September 24, 2003
- Combined they:
- Put the Department on the path to improve the acquisition and management of its real property assets over the life-cycle.

## Real Property Asset Management

**Real Property Asset Management**

**Integrated plan within a geographic area that supports Departmental and Program guidance**

- DOE O 413.3

- RPAM
- DOE O 430.1B

## DOE Project Management Process

**Range of Alternatives****  **

**Cost Range**

- CD-0
- Approve Mission Need

- CD-1
- Approve Alternative Selection and Cost Range

- CD-2
- Approve Performance Baseline

- CD-3
- Approve Start of Construction

- CD-4
- Approve
- Start of Operations or Project Closeout

*Critical*
*Decisions*

- Operating funds/
- Program funds

- PED funds

- PED funds

- Project funds

- Operating funds/
- Program funds

**Initiation Phase**

**Definition Phase**

**Transition/Closeout Phase**

**Execution Phase**

- Performance Measurement
**Earned Value ****(for projects over $20M)**

## Ten Year Site Plans

**Ten Year Site Plan Features:**
- Integrates functional components of land use, facilities and infrastructure acquisition, maintenance, recapitalization, safety & security, and disposal plans into comprehensive site-wide management plan.
- Links Facilities and Infrastructure resource requirements to Ten Year Site Plans to Mission.
- Requires assessment of past performance and projected future outcomes.
- Strengthens communication and  accountability between programs /  sites / and tenants.
- Requirements Driven.

## Communication of Requirements

**DOE Strategic Plan**
**&**
**Planning Guidance**

**Program **
**Guidance**

**Tenant **
**Requirements**

## Resource Requirements

**Resource Requirements**

## Performance Measurement

- RPAM establishes three corporate outcome measures for real property asset management:
- Asset Condition Index (ACI)
- Asset Utilization Index (AUI)
- Quarterly Maintenance Budget Execution versus Plan
- Norm for annual maintenance is 2-4% of Replacement Plant Value per the National Academies of Sciences and Engineering and industry standards.
- Project Management Order and Manual establish the Earned Value Management System as the performance measure for acquisitions.
- Programs and site managers should develop additional metrics to measure attainment of program goals.
- Ten Year Site Plans should establish requirements and expected outcomes for performance measurement.

## Summary Statistics

| Organization | Project Assessment Summary |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- |
|  | Number of Projects Past CD-2 | Green | 
Yellow
 | 
Red
 | % of Projects with Green Status | % of $$ Value with Green Status |
| NNSA | 34 | 30 | 0 | 4 | 88% | 98% |
| EM | 35 | 29 | 3 | 3 | 83% | 83% |
| SC | 22 | 22 | 0 | 0 | 100% | 100% |
| NE | 2 | 2 | 0 | 0 | 100% | 100% |
| EE | 1 | 1 | 0 | 0 | 100% | 100% |
| Total DOE | 94 | 84 | 3 | 7 | 89% | 87% |

**Summary Statistics**

*The DOE target for FY04 is that 90% of projects have “Green” status both by number and dollar value.  *

## F&I Summary Statistics

|  | Asset Utilization Index | Asset Condition Index | 
IFI  Crosscut Maintenance Budget Execution
($M) |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  | 1st Qtr |  | 2nd QTR |  | 3rd QTR |  | 4th QTR |  |
|  |  |  | Plan | Act | Plan | Act | Plan | Act | Plan | Act |
| Program A | 0.89 | 0.92 | 70.5 | 71.3 |  |  |  |  |  |  |
| Program B | 0.77 | 0.74 | 43.5 | 44.6 |  |  |  |  |  |  |
| Program C | 0.90 | 0.89 | 16.3 | 16.3 |  |  |  |  |  |  |
| Program D | 0.91 | 0.92 | 9.5 | 9.6 |  |  |  |  |  |  |
| Program E | 0.95 | 0.93 | 9.2 | 7.5 |  |  |  |  |  |  |
| Total DOE |  |  | 149.0 | 149.3 |  |  |  |  |  |  |

**F&I Summary Statistics**

**SAMPLE**

## Facility Information Systems

**Facility Information Management System (FIMS)**
- Department’s official real property asset database.
- Repository for real property inventory / condition assessment / maintenance data / LTS requirements.
- Feeder into Department’s financial reporting systems.
- Data source for TYSPs, management analysis, assessments, and outcome measures.

## Executive Order 13327Federal Real Property Asset Management

- Directs executive branch departments and agencies to:
- Recognize importance of real property resources through increases management attention.
- Establish clear goals and objectives.
- Improve levels of accountability.
- Establishes Federal Real Property Council at OMB.
- Requires agencies to develop and submit asset management plans.
- New Program intiative “ Federal Real Property Asset Management” added to President’s Management Agenda

## Executive Order 13327Federal Real Property Asset Management

**Executive Order *****Policy***** – **to promote the efficient and economic use of America’s real property assets to assure management accountability for implementing Federal real property management reforms.

**DOE Order 430.1B *****Objective –**** *to* *establish a corporate, holistic and performance-based approach to real property asset management that links real property asset planning, programming, budgeting, and evaluation to program mission projections and performance outcomes.  Order identifies requirements and establishes reporting mechanisms and responsibilities for real property asset management

## Executive Order 13327Federal Real Property Asset Management

- Develop & implement agency asset management plan.
- Identify all agency real property
- Prioritize actions to manage real property inventory

- RPAM establishes corporate asset management plan linking assets to mission to outcomes. (1.)
- Facilities Information Management System (FIMS) is the corporate database for real property asset info. (4.b.(8).(a))
- Ten Year Site Plans (TYSP) must address how real property assets support DOE’s strategic plan and missions. (4.a.(3))

_**Executive Order**_

_**RPAM**_

## Executive Order 13327Federal Real Property Asset Management

- Life-cycle cost estimations
- Identify asset management performance measures
- Manage assets consistent with agency’s strategic and asset management plan
- Provide real property asset inventory

- Managers shall assess application of Value Engineering to achieve essential functions at lowest life-cycle costs. (4.f)
- Asset Utilization Index and Asset Condition Index are the corporate measures for real property asset management. (4.g)
- Ten Year Site Plans (TYSP) must address how real property assets support DOE’s strategic plan and missions. (4.a.(3))
- FIMS is the corporate database for real property asset info. (4.b.(8).(a))

_**Executive Order**_

_**RPAM**_

## Challenges

**Successful implementation dependent upon:**
- Clear definition and communication of requirements and expectations.
- Effective communication at all levels.
- Integration of multi-program requirements.
- Valid data.
- Qualified facility management staff.
- Federal government employees.
- Contractor facilities managers.

**Backup Slides**

## Roles & Responsibilities

** ****Geographic Area Coordination**
** ****Host for tenant Programs / Activities**
** ****Infrastructure Support Provider**
**TYSP Coordinator**

**LPSO**

**CSO/PSO**

**Field Program**
**Office**

**Site**

**Mission / Program / **

**Requirements / Resources**
**TYSP ( Program / Infrastructure)**

**Requirements / Resources**
**TYSP ( Program / Support)**

**Mission / Program**

**HQ Coordination**

**OMBE**

**OECM**

_**Departmental**_
** ****Policy / Oversight**
** ****PPB &E**
** ****Metrics**

**Infrastructure**

**Roles & Responsibilities**