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34–783 PDF 2007

A CASE STUDY IN NATIONAL GENERAL SERVICES ADMINISTRATION

LOCATION POLICIES FOR FEDERAL

AGENCIES

(110–12)

FIELD HEARING

BEFORE THE

SUBCOMMITTEE ON 

ECONOMIC DEVELOPMENT, PUBLIC BUILDINGS AND 

EMERGENCY MANAGEMENT

OF THE

COMMITTEE ON 

TRANSPORTATION AND 

INFRASTRUCTURE 

HOUSE OF REPRESENTATIVES

ONE HUNDRED TENTH CONGRESS

FIRST SESSION

FEBRUARY 27, 2007 (WASHINGTON, DC)

Printed for the use of the 

Committee on Transportation and Infrastructure

(

COMMITTEE ON TRANSPORTATION AND INFRASTRUCTURE 

JAMES L. OBERSTAR, Minnesota, Chairman 

NICK J. RAHALL, II, West Virginia 

PETER A. DEFAZIO, Oregon 

JERRY F. COSTELLO, Illinois 

ELEANOR HOLMES NORTON, District of 

Columbia 

JERROLD NADLER, New York 

CORRINE BROWN, Florida 

BOB FILNER, California 

EDDIE BERNICE JOHNSON, Texas 

GENE TAYLOR, Mississippi 

JUANITA MILLENDER-MCDONALD, 

California 

ELIJAH E. CUMMINGS, Maryland 

ELLEN O. TAUSCHER, California 

LEONARD L. BOSWELL, Iowa 

TIM HOLDEN, Pennsylvania 

BRIAN BAIRD, Washington 

RICK LARSEN, Washington 

MICHAEL E. CAPUANO, Massachusetts 

JULIA CARSON, Indiana 

TIMOTHY H. BISHOP, New York 

MICHAEL H. MICHAUD, Maine 

BRIAN HIGGINS, New York 

RUSS CARNAHAN, Missouri 

JOHN T. SALAZAR, Colorado 

GRACE F. NAPOLITANO, California 

DANIEL LIPINSKI, Illinois 

DORIS O. MATSUI, California 

NICK LAMPSON, Texas 

ZACHARY T. SPACE, Ohio 

MAZIE K. HIRONO, Hawaii 

BRUCE L. BRALEY, Iowa 

JASON ALTMIRE, Pennsylvania 

TIMOTHY J. WALZ, Minnesota 

HEATH SHULER, North Carolina 

MICHAEL A. ACURI, New York 

HARRY E. MITCHELL, Arizona 

CHRISTOPHER P. CARNEY, Pennsylvania 

JOHN J. HALL, New York 

STEVE KAGEN, Wisconsin 

STEVE COHEN, Tennessee 

JERRY MCNERNEY, California 

JOHN L. MICA, Florida 

DON YOUNG, Alaska 

THOMAS E. PETRI, Wisconsin 

HOWARD COBLE, North Carolina 

JOHN J. DUNCAN, JR., Tennessee 

WAYNE T. GILCHREST, Maryland 

VERNON J. EHLERS, Michigan 

STEVEN C. LATOURETTE, Ohio 

RICHARD H. BAKER, Louisiana 

FRANK A. LOBIONDO, New Jersey 

JERRY MORAN, Kansas 

GARY G. MILLER, California 

ROBIN HAYES, North Carolina 

HENRY E. BROWN, JR., South Carolina 

TIMOTHY V. JOHNSON, Illinois 

TODD RUSSELL PLATTS, Pennsylvania 

SAM GRAVES, Missouri 

BILL SHUSTER, Pennsylvania 

JOHN BOOZMAN, Arkansas 

SHELLEY MOORE CAPITO, West Virginia 

JIM GERLACH, Pennsylvania 

MARIO DIAZ-BALART, Florida 

CHARLES W. DENT, Pennsylvania 

TED POE, Texas 

DAVID G. REICHERT, Washington 

CONNIE MACK, Florida 

JOHN R. ‘RANDY’ KUHL, JR., New York 

LYNN A WESTMORELAND, Georgia 

CHARLES W. BOUSTANY, JR., Louisiana 

JEAN SCHMIDT, Ohio 

CANDICE S. MILLER, Michigan 

THELMA D. DRAKE, Virginia 

MARY FALLIN, Oklahoma 

VERN BUCHANAN, Florida 

(II)

SUBCOMMITTEE ON ECONOMIC DEVELOPMENT, PUBLIC BUILDINGS AND EMERGENCY

MANAGEMENT

ELEANOR HOLMES NORTON, District of Columbia, Chairwoman 

MICHAEL H. MICHAUD, Maine 

JASON ALTMIRE, Pennsylvania 

MICHAEL A. ARCURI, New York 

CHRISTOPHER P. CARNEY, Pennsylvania 

TIMOTHY J. WALZ, Minnesota 

STEVE COHEN, Tennessee 

JAMES L. OBERSTAR, Minnesota 

(Ex Officio) 

SAM GRAVES, Missouri 

BILL SHUSTER, Pennsylvania 

SHELLEY MOORE CAPITO, West Virginia 

CHARLES W. DENT, Pennsylvania 

JOHN R. ‘RANDY’ KUHL, JR., New York 

JOHN L. MICA, Florida 

(Ex Officio) 

(III)

(V)

CONTENTS 

Summary of Subject Matter .................................................................................... vi 

TESTIMONY 

Page 

Anthony, Mignon, Project Manager, Bureau of Alcohol, Tobacco, Firearms 

and Explosives ...................................................................................................... 5

Baschuk, Bruce, Chairman, NoMa Business Improvement District ................... 5

Winstead, David L., Commissioner, Public Buildings Service, General Services 

Administration, accompanied by Bart Bush, Assistant Regional Administrator for the National Capital Region, General Services Administration ...... 5

PREPARED STATEMENT SUBMITTED BY A MEMBER OF CONGRESS 

Norton, Hon. Eleanor Holmes, of the District of Columbia ................................. 51

PREPARED STATEMENTS SUBMITTED BY WITNESSES 

Anthony, Mignon ..................................................................................................... 30

Baschuk, Bruce ........................................................................................................ 33

Winstead, David L. .................................................................................................. 54

SUBMISSION FOR THE RECORD 

Baschuk, Bruce, Chairman, NoMa Business Improvement District, NoMa 

Business Improvement District, map and executive summary ........................ 37

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(1)

A CASE STUDY IN NATIONAL GENERAL SERVICES ADMINISTRATION LOCATION POLICIES 

FOR FEDERAL AGENCIES 

Tuesday, February 27, 2007

HOUSE OF REPRESENTATIVES, 

COMMITTEE ON TRANSPORTATION AND INFRASTRUCTURE, 

SUBCOMMITTEE ON ECONOMIC DEVELOPMENT, PUBLIC

BUILDINGS, AND EMERGENCY MANAGEMENT, 

Washington, DC. 

The subcommittee met, pursuant to call, at 10:00 a.m., in Hearing Room 1 at Federal Energy Regulatory Commission, 888 First 

Street, Northeast, Washington, D.C., Hon. Eleanor Holmes Norton 

[chairman of the subcommittee] presiding. 

Ms. NORTON. Good morning, can you hear me? I am very pleased 

to welcome today’s witnesses to this hearing on the General Service 

Administration’s Site Location Policy entitled, ‘‘A Case Study in 

National GSA Location Policies for Federal Agencies.’’

I especially thank the Federal Energy Regulatory Commission, 

their officials and their staff, who readily made excellent accommodations available for today’s hearing. 

For 16 years, our Subcommittee, on which I have served ever 

since coming to Congress, has had an opportunity to closely observe 

GSA as it has located Federal agencies here, creating a virtual microcosm of GSA location policies nationwide. 

The agency is charged by statute to perform various developer, 

landlord and real estate functions. Established in 1949, the GSA 

has unique and unsurpassed expertise in every location in the 

country, including extensive knowledge of local and regional real 

estate markets, costs, availability, and trends. 

GSA is responsible for approximately $3.8 billion of leased space, 

office space nationwide, and for finding space for almost all Federal 

agencies with the exception of the Department of Defense and Veteran Administration entities. 

Today’s hearing seeks to learn more about the GSA’s role as real 

estate agent, specifically, as to how it carries out its statutory responsibilities in guiding and advising agencies seeking office space, 

and whether the GSA is meeting the Statute’s requirements in carrying out this mission. 

According to Title 40, Subtitle 1, Paragraph 584, the Administrator of General Services is responsible for assigning and reassigning space. She exercises this authority after ‘‘consultation’’ with 

the head of an agency, and on the determination that the ‘‘assignVerDate 0ct 09 2002 16:34 Sep 20, 2007 Jkt 000000 PO 00000 Frm 00009 Fmt 6633 Sfmt 6633 P:\DOCS\34783 HTRANS1 PsN: JASON
2

ment or reassignment’’ is advantageous to the Government in 

terms of economy, efficiency or national security. 

GSA is assigned this responsibility because unlike other Federal 

agencies it has unique professional and technical knowledge. Importantly, this function is assigned to GSA, and not to Federal 

agencies themselves, in order to assure adherence to uniform policies, to control important variables such as cost per square foot, 

and to assure that taxpayers receive the best valuable for the available Federal funds. 

Because the District of Columbia is the Nation’s capitol with 

many Federal agencies, this jurisdiction is ideal for studying how 

GSA carries out its location policy mandate nationwide. 

The Subcommittee, for several years, has received complaints 

that GSA decisions have created the impression that some locations 

are unacceptable, despite their proximity to public transportation 

and amenities, even where there is existing Federal investment. 

Today we are holding this hearing in a location that can act fairly as a case study, for looking closely at GSA location policy. We 

are holding this field hearing in a Federal agency, in the heart of 

an area known as NOMA, which stands for North of Massachusetts 

Avenue. This area generally bounded by Union Station, North Capitol Street, Florida and New York Avenues, and 2nd Street, N.E., 

was once dotted with warehouses, parking lots, and vacant lots. 

However, its prime location led to make over that began almost two 

decades ago. 

NOMA is located in the Central Employment Area, the CEA, defined as, ‘‘parts of the central area of Washington where employment facilities are concentrated and adjacent to areas where additional development, economic diversification, and job generation 

are encouraged.’‘

NOMA qualifies to be included in the CEA because it, ‘‘contains 

a mix of land uses that efficiently support the existing Federal activities.’‘

As part of the GSA project authorization project, including requests for proposals, a CEA description is always attached. 

The private sector has long given NOMA its vote of confidence, 

even before a New York Avenue Metro Station was added with 

funds jointly from the private sector, the Federal Government, and 

the District of Columbia Government. 

NOMA has been the headquarters for brand-name, private, public, and non-profit entities, among them XM Radio, CareFirst/Blue 

Cross Blue Shield, the Securities and Exchange Commission, and 

Kaiser Permanente, and, of course, FERC, the agency, we are holding this hearing, and there area many more that I could name. 

NOMA is in the midst of a building boom, and will have about 

60 percent office space and 40 percent rental housing, we are told. 

The confidence in the private market is so high that a supermarket 

will be built before most of the housing will be done. In addition, 

a number of other factors would appear to make NOMA desirable 

to Federal agencies. 

Most Federal agencies located in the District desire to remain 

here, and NOMA is located close to the capitol of the United States, 

and has rates that are significantly below those in other downtown 

locations. 

3

NOMA is not only close to the New York Avenue Metro, but also 

to Union Station, the City’s transportation hub, where rail, light 

rail, Metro, bus and taxi service converge. However, it must be 

noted that Federal investment in urban areas is not limited to CEA 

areas only. Guided by Executive Orders, GSA is charged to bring 

Federal facilities to urban areas throughout the country to, 

‘‘strengthen the Nation’s cities and make them attractive places to 

live and work,’‘ as one Executive Order states. 

However, Washington, D.C. is unique among large cities, in that 

most agencies need little inducement to remain or locate in the Nation’s capitol. The major location challenge GSA finds here is, there 

is not enough space for many of the agencies that desire to consolidate and expand in the District. It cannot be doubted that the Federal Government regards the centrally located NOMA area as vital 

to Federal interest. The NOMA transformation has been significantly influenced by Federal policy and construction. 

The new Bureau of Alcohol, Tobacco and Firearms, or ATF Headquarters, signaled that NOMA was regarded as an ideal site for 

Federal facilities. 

To make the point unmistakable, the Federal Government also 

invested in an extra Metro Station that had not been planned as 

part of the Metro system, and, specifically, positioned the station 

to serve the NOMA area, fulfilling GSA’s requirement that Federal 

facilities be located in close proximity to public transportation. 

As a result, NOMA has a new Metro Station on the north end, 

in addition to the Union Station Metro that has long served much 

of NOMA. We are holding this hearing at FERC, which has been 

located in NOMA for more than 30 years, and chose to stay here 

in 1995, when it moved to this new, very attractive building. 

How can we explain 50 city blocks of existing and planned belowmarket office space without any significant commitment from any 

Federal agency since the ATF anchor was awarded and the New 

York Avenue Metro was built. 

In years of oversight of GSA, through Democratic and Republican 

administrations like, this Subcommittee has found evidence that 

agency preferences, not statutory mandates, often dominate GSA 

selections. The 57-acre government-owned Southeast Federal Center, located five minutes from the Capitol, is a particular case in 

point. GSA was unable to convince agencies to locate there. After 

ten years of seeing agencies avoid the area I introduced the Southeast Federal Center legislation, that for the first time is allowing 

the private sector to develop a federally-owned site that the Federal Government itself could not, and did not, develop. 

Shortly thereafter, of course, the new Department of Transportation Headquarters, scheduled to open soon, was built on part of 

this government-owned Southeast Federal Center site, where GSA 

had previously been unable to attract Federal agencies. 

Meanwhile, Federal agencies have continued to lease higherprice space in more traditional areas near K Street, Connecticut 

Avenue, and similar downtown locations. Not surprisingly, Federal 

employees often prefer downtown locations, locations near shops, 

theaters and restaurants. Agency preferences are, of course, relevant, and must be taken into account. 

4

However, significant questions are raised concerning GSA’s adherence to statutory requirements, when sites complete with amenities are continually bypassed in NOMA, which is close to the Capitol, other Federal agencies, private and non-profit entities, and the 

Union Station Mall and Metro Stations at both ends of the area as 

well. 

Who is calling the shots? 

The Subcommittee has documented luxurious courthouses, virtually, designed by judges, because GSA, essentially, deferred its 

statutory role to them. The result has been luxurious courthouses, 

with scandalously lavish comforts, including individual showers, 

kitchens, and special exercise facilities only for judges, unknown in 

public buildings. 

Is there deference to Federal agencies in seeking space at the expense of U.S. taxpayers as well? 

This much is clear, today’s staggering Federal deficit requires 

that GSA demonstrate that the agency can do much more, and that 

the agency takes seriously its responsibility to ensure that the Federal Government gets the best price, while agencies are comfortably 

and conveniently accommodated. 

This nationwide obligation increases exponentially when the Federal Government has moved and advanced the targeting area with 

pioneering office space, such as the ATF Headquarters at the north 

end of NOMA, as well as new transportation facilities. 

GSA is a peer agency, and may need assistance from our Subcommittee to meet pressures from Federal agencies that assume 

they can have their pick of space, regardless of how the Federal 

real estate tax dollar is spent. This Subcommittee does not seek to 

penalize GSA or other Federal agencies. However, we are resolute 

in our determination that the Federal office space, not only reflect 

the best accommodations for agencies, but also, and I emphasize, 

the best deal for the taxpayer. 

This hearing begins the process of assuring this policy and this 

outcome. 

Again, I welcome today’s witnesses, and I look forward to their 

testimony. I’d be pleased to recognize my colleague, Mr. Cohen, if 

he has a statement to offer at this time. 

Mr. COHEN. Thank you, Madam Chairman. 

I didn’t necessarily know what I was walking into, but I’m happy 

I’m here, and I’m happy I’m here for many reasons. First of all, as 

I came in this building, I am Freshman Congressperson, and I reflected on the fact, Madam Chairman, that I think it was, if I’m 

accurate, 34 years ago after I finished law school, I had a friend 

up in Washington, an attorney named Flanagan, and Mr. Flanagan 

was very close to Speaker Tip O’Neill, and he had arranged to get 

me a job up here as an attorney, with this group here, the Federal 

Energy, I know we are here at GSA, but the Federal Energy Regulatory Commission, and I was really happy to be coming to Washington as an attorney, and was up for like a secondary interview, 

and the lady that interviewed me, this was in the Nixon days, said, 

‘‘I see here you ran for office as a Democrat,’‘ which I had done 

when I was in college. 

And, I said, ‘‘Yes, ma’am.’‘

5

And, she said, ‘‘I guess all you people down there are Democrats.’‘

And, I took that as a negative from her, and I didn’t get that job. 

So, it’s good to be back here in a different capacity, a little bit 

ironic. 

As a Freshman, I get lost quite often in the Capitol buildings and 

other places, and I’ve gotten lost and, therefore, I’ve discovered the 

NOMA district. I live at 4th and Mass., I’m kind of in the hood, 

and when I got lost I stopped at a place where they had a grocery 

store, and I think they specialized in meats, they weren’t necessarily premium meats, but they had like rib eyes, 12 for $15.00 

or something like that. It was a pretty low income, I think, grocery 

store. 

And, when I saw the neighborhood which we are talking about, 

there’s no question it needs development, and it’s important that 

this NOMA district be developed, and the Federal Government peruse the materials given as President Carter instructed, that whenever possible we try to go into urban districts and help urban development. There was a report on poverty in the United States that 

just came out the other day, and I think it said that the disparity 

in wealth is getting greater and greater. The number of people that 

are extremely low income has grown in a very disproportionate 

amount and share compared to the rest of the society, and Washington, D.C., I think, had the highest number of people in extreme 

poverty. I would suspect that part of some help we could provide 

is to follow President Carter’s law passed during his Administration, and to develop areas such as NOMA with Federal buildings 

when possible, because it would certainly be a help to the Nation’s 

Capitol. I think when the Nation’s Capitol is improved and aided, 

that the country is aided. 

So, I’m happy to be here. I just happened to wander into an area 

that I think is—the Chairwoman has led me to a good spot. 

Thank you, Madam Chairwoman. 

Ms. NORTON. Well, Mr. Cohen, you may not have gotten a bad 

job with the people of Tennessee, so I gave you another one. 

I’d be pleased to hear from today’s witness, Mr. Winstead, would 

you like to start. 

TESTIMONY OF DAVID L. WINSTEAD, COMMISSIONER, PUBLIC 

BUILDINGS SERVICE, GENERAL SERVICES ADMINISTRATION 

ACCOMPANIED BY BART BUSH, ASSISTANT REGIONAL ADMINISTRATOR FOR THE NATIONAL CAPITAL REGION, GENERAL SERVICES ADMINISTRATION; MIGNON ANTHONY, 

PROJECT MANAGER, BUREAU OF ALCOHOL, TOBACCO, FIREARMS AND EXPLOSIVES; BRUCE BASCHUK, CHAIRMAN, 

NOMA BUSINESS IMPROVEMENT DISTRICT 

Mr. WINSTEAD. Sure. Can you hear me all right? 

Chairman Norton and Congressman Cohen, I’m very pleased to 

be here. I’m David Winstead, Commissioner of Public Building 

Service, General Services Administration. I bring you greetings of 

Administrator Doan, and I’m very pleased to be here today to testify, and continue working with you and the Committee in the 

110th Congress. 

6

I’d like to take the opportunity of also introducing our Assistant 

Regional Administrator for National Capital Region, Bart Bush, 

who joined the Department, oh, about six or eight months ago, and 

he is directly involved, obviously, in our NCR leasing activity, and 

directly to some of the issues that Chairman Norton mentioned is 

encouraging, attention both on redeveloping the opportunities 

emerging in the NOMA area, as well as other markets in the District of Columbia. 

As the Chairman knows, we have been very actively involved 

with the District Government in developing community, as well as 

Chairman Norton and this Committee, in revitalization of the District of Columbia. 

In the past ten years, we’ve worked very, very closely with our 

partners in the Southeast Federal Center. As Chairman Norton 

mentioned the legislation, and that 1.8 million square feet, including the Department of Transportation Headquarters, which will be 

opening shortly, some 2,800 residential units, as well as 200,000 

neighborhood-serving destination, as well as a five and a half acre 

regional park. 

We are also working with the District to develop preservation of 

the St. Elizabeth’s Campus, which we’ve spent a lot of time on and 

working with the Coast Guard and Department of Homeland Security, this 176-acre site offers enormous opportunity in securing a 

Federal campus for the needs of the Department of Homeland Security. It’s also a challenge in terms of saving and preserving its 

characteristics as a National Historic Landmark. 

And finally, and the reason why we are here today, is to both 

talk about locational policy of GSA and the Public Building Service, 

but also our commitment in terms of the tenancy in this section of 

the District of Columbia, NOMA. We presently occupy about 2.8 

million square feet of space in NOMA. Included in this total is 

headquarters for three major Federal agencies, the Bureau of 

Labor Statistics, FERC, this building, as well as the new Bureau 

of Alcohol, Tobacco and Firearms building, which is a fabulous new 

headquarters for them opening up here shortly in NOMA. 

For the past few years, GSA has undertaken a variety of actions 

in cooperation with other districts and this Committee, obviously, 

with Madam Chairman’s leadership, to reacquaint our staff with 

the NCR and our tenant agencies with what NOMA has to offer. 

I actually, in my prior life as a lawyer here in the District of Columbia, am very familiar with this region, and also in a role I had 

years ago with Secretary of Transportation now I’m very conscious 

of the importance of New York Avenue, Union Station, in terms of 

the transit station intermodal connections there, as well as the 

transit stations here in the NOMA area. 

I think our efforts have included, not only to work directly with 

our tenant agencies, but briefings for developers in NOMA, on how 

to do business with GSA, tours for potential tenants, and agencies 

looking for attractive workplace solutions, and as the Chairman 

said, looking at both quality workplace and the best value to the 

taxpayer. 

And, we also, I also took a tour of the ATF Headquarters in the 

NOMA area recently with the Chairman, as well as our Administrator, Lurita Doan, looking at both existing Federal tenancy as 

7

well as opportunities in this market of the District of Columbia. In 

fact, today we are sponsoring a region-wide location fair, and have 

invited state and local economic development officials, as well as 

agency tenants. And, the purpose of this, which is done regularly, 

is to educate Federal tenants about local economic development 

projects, so that they can make more informed choices and decisions with us on location in the District of Columbia, sending representatives from both NOMA as well as other areas of the City. 

Our efforts to locate significant Federal agencies in NOMA date 

all the way back to 1990, when GSA signed a major lease of the 

Hines Corporation properties, and what is now known as Portal 

Square at the corner of Massachusetts Avenue and North Capitol 

Street, for a new headquarters of the BLS. Our lease enabled 

Hines, which has redeveloped the site on behalf of the U.S. Postal 

Service, to obtain financing and to double the size of the building, 

restore its historic areas. 

In addition to BLS, it housed a Capitol City Brewery Company 

restaurant, a post office, and Smithsonian Postal Museum. 

Currently, as noted by the Chairman, GSA is nearing completion, 

we have Ms. Anthony here, a major tenant, completion of the construction of a new 438-square foot headquarters for ATF at the 

intersection of Florida Avenue, New York Avenue, near the northern boundary of NOMA. This project is coming into the area that 

has previously consisted mostly of abandoned warehouses and 

empty lots, and the ATF itself was, and the ATF site, was a public 

works yard for the District of Columbia. It’s most prominent feature at one point was some old railroad trellises. 

The District Government, the Metro system, which is a marvelous Federal and local investment in the National Capitol Region, and our NOMA neighbors, have provided valuable assistance 

by working with Federal Government to jointly finance the construction of a new Metro Station immediately east of the ATF 

building. 

I would note that in my prior life I was cognizant of the way this 

was negotiated, and it was a very innovative investment, public/

private investment, in the expansion of transit to serve a major 

urban area such as NOMA. 

Development of this station, which is now open for business, is, 

in fact, the first time in the U.S. had a new subway station was 

added between two existing stops, while continuing to provide service along that line, which was a remarkable engineering, as well 

as construction feat. 

Both the presence of the new ATF building and the new Metro 

Station has contributed significantly to making the northern and 

central portions of NOMA attractive to office development. 

In an article last December, December of 2006, in the Washington Business Journal, which sort of tells the story of how ripe 

this area is, and the kind of development and investment its attracting, it was estimated that a total of $1.2 billion in new construction will occur, commitments made and occur during this current Fiscal Year 2007. 

In today’s hearings, as the Chairman mentioned, we’ve been 

asked to answer questions about GSA tenant agencies, and whethVerDate 0ct 09 2002 16:34 Sep 20, 2007 Jkt 000000 PO 00000 Frm 00015 Fmt 6633 Sfmt 6633 P:\DOCS\34783 HTRANS1 PsN: JASON
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er they are, in fact, giving full—we are giving full consideration to 

NOMA. 

As you are aware, one concern expressed in the past has been 

an issue in terms of amenities in northern and central part of 

NOMA. GSA has taken action on its own to include 8,000 square 

feet of restaurant and retail facilities as a part of the ATF Headquarter development, located directly across the street from the 

new Metro Station. 

We anticipate announcing our selection of a retail manager, master leaser for this space in the next few weeks, and we believe that 

this master lease will, in fact, be—they will, in fact, be responsible 

for fitting out and attracting tenants and managing this facility, 

which we think this 8,000 square feet will provide a lot of amenities, a lot of restaurant and retail functions, for both our tenant, 

ATF, and their employees. And so, we are really urging this solution, and are on the public side a part of adding increased amenities in this area. 

GSA has also encouraged our tenant agencies to consider NOMA 

by adding into the delineated area that GSA uses as a starting 

point for all of our lease actions in Washington, D.C. In addition, 

in January, 2006, we issued a real estate bulletin, which established a higher level of scrutiny of agencies proposed, tenant agencies proposed to the areas. All acquisition plans now include a written justification to demonstrate that agencies have taken into consideration specific location, economies, market rates, as well as 

other related costs, real estate, labor, and other operational costs, 

and applicable local incentives, such as we see throughout the Metropolitan Washington Area, a lot of local governments are very 

highly desirous of GSA and Federal tenancies, and are offering 

enormous incentives. 

We followed this up by meeting with agency contacts in June of 

this last year, and before I sort of conclude, I know these are brief 

opening statements, I’d like to sort of acquaint the Subcommittee 

with the ongoing issues that are attentive to this area, both in 

terms of development, I mentioned 1.2 million square feet, also to 

issue spacing us in terms of transportation, ensuring that the District study of alternatives for upgrading the capacity of New York 

Avenue, proceed in looking at how to handle this volume in a way 

that encourages access to NOMA and serves our client needs, in 

terms of car access, as well as, obviously, the transit access which 

we have. 

We are participating with D.C. DOT in that regard, working 

closely with Mayor Williams in terms of its efforts along the New 

York Avenue corridor, as well as Florida Avenue, and what options 

are available there. We will continue to work with the National 

Capitol Planning Commission, and we joined them in a recent 

three-day charette on this issue about improving New York and 

Florida Avenue intersections. 

So, we are very pleased to continue, and we’ll report to this Committee any of our thoughts in that regard. 

But, Madam Chairman, just in concluding, I would like to mention that GSA has promoted, and will continue to promote, NOMA 

as a good location for Federal office tenants. I think we’ve already 

done that quite a bit, obviously, the 2.8 million square feet, obviVerDate 0ct 09 2002 16:34 Sep 20, 2007 Jkt 000000 PO 00000 Frm 00016 Fmt 6633 Sfmt 6633 P:\DOCS\34783 HTRANS1 PsN: JASON
9

ously, the investment of 8,000 square feet of retail and other amenities to serve the ATF employees, and I think you’ll hear about that 

from our next panelist. 

But, NOMA is a part of our delineated area for selecting office 

space, and we are very, very committed to it, and think it has a 

very, very bright future. 

Madam Chairman, just in conclusion, a letter you received recently from our Administrator sort of highlights, and just in summary, the commitments that we have taken, in terms of increase 

commitment, and looking at how we work with the private options 

and Federal tenancy in NOMA, and just to reiterate, we have expanded limited areas to include NOMA. We’ve met with interested 

developers and property owners to provide in-depth explanation of 

how our leasing process works. We met with the D.C. Office of 

Planning to learn of efforts they have contemplated to upgrade the 

neighborhood. We participated, as I mentioned, in this recent 

charette with the Department, D.C. Department of Transportation, 

and, obviously, the commitment of ATF as the new Headquarters 

here in NOMA will have significant economic development benefits 

and also our commitments in terms of these new master lease to 

bring amenities to the area. 

We are, just in conclusion, we appreciate this opportunity. We 

look forward, Madam Chairman and Chairman Cohen, to continue 

to work with the Subcommittee, to look at this issue of our commitment to providing the best workplace solution and the best value 

to the Federal taxpayer. 

Thank you. 

Ms. NORTON. Thank you, Mr. Winstead. 

Ms. Anthony. 

Ms. ANTHONY. Good morning, Chairwoman Norton, Mr. Cohen, 

and Distinguished Members of the Subcommittee. My name is 

Mignon Anthony, and I’ve served as the Director of New Building 

Projects for the Bureau of Alcohol, Tobacco, Firearms and Explosives for the past eight years. I bring greetings from our Acting Director, Mr. Michael Sullivan, and appreciate the opportunity to address you this morning. 

I’m pleased to be here today, primarily, because it represents the 

culmination of the commitments by this Subcommittee, Chairwoman Norton in particular, the General Services Administration, 

the District of Columbia, and another stakeholders, to move ATF 

to the corridor north of Massachusetts Avenue, known as NOMA. 

As we are all aware, this cross roads intersection of New York 

Avenue, Florida Avenue, 1st Street, Eckington Place, O Street, and 

the new 2nd Street, N.E., is at the very east end boundary of 

NOMA, and our partners, XM Satellite Radio, Federal Express, 

and Douglas Jamal’s People’s Building, pioneered that neighborhood where Wards 5 and 6 meet, and where the Metropolitan Police District—three Metropolitan Police Districts intersect. 

It was on a chilly December morning in 1999 that public and private entities met at the longstanding public works yard at New 

York and Florida Avenue to memorialize this agreement and partnership. Under the terms of that agreement, the ATF Headquarters, a Federal building, essentially, would become the anchor 

development for this burgeoning neighborhood and for the gateway 

10

corridor to our Nation’s Capitol. Much work and five short years 

later, we all remember, we assembled again to celebrate another 

anchor, that’s the public/private partnership and the success of the 

openings of the New York Avenue, Florida Avenue, Galludet University Metro Rail Station. 

Although the City initially had a very different vision for this 

area, one of brass and glass, and one that really did not include 

a Federal law enforcement agency, it took only one session at 

ATF’s current Chinatown offices to convince everyone that ATF’s 

new home would represent the corporate image of the Federal Government. 

We worked with GSA, we worked with the District, with the 

Washington Metropolitan Transit Authority, and many others, to 

develop a plan that would help to establish a face for NOMA, that 

would enable a vibrant and living work environment to grow and 

take into account our critical security needs. 

While acknowledging a wide range of options of opinions about 

the design of our building of 438,000 square feet, I think we can 

all agree that the new ATF Headquarters building is an outstanding structure that will provide a unique and modern statement for the District of Columbia, as well as the people of the 

United States of America. 

We, at ATF, are very proud to have our first dedicated permanent headquarters building, and to have it located in the NOMA 

neighborhood. We strongly believe that our 1,100 headquarters employees will be a vital part of the local community, both economically and socially. 

In considering NOMA, the NOMA site in 1999, GSA worked with 

us, and it was really perceived as ideal for ATF’s future, because 

it was in town, but now downtown. Now, because it provided an opportunity to strongly influence the new retail and the new amenities that were going to be there to represent a steady Federal presence, and because it provided an opportunity for a win/win situation, a win/win partnership, with Metro because of its proximity to 

the Red Line Metro Station. 

However, since selecting the site, the core communities of 

NOMA, residents, institutions, developers and private companies, 

have consistently included ATF in their planning for growth dependency and cooperation, strong cooperation. This summer, ATF 

has relocated all of our headquarters operations to NOMA, both to 

the 1,100 person new Federal Headquarters building, and also to 

1 NOMA Center, which is located at 131 M Street, under the historic Woodward & Lothrop Warehouse Water Tower. We were very 

excited about the additional partners moving to NOMA, the Marriott Hotel, and we strongly encourage other Federal agencies to 

move there. Together we can all enjoy and work to enhance the social and economic benefits of the neighborhood, and again, Chairwoman Norton and Distinguished Members of the Committee, I 

thank you for this invitation to appear before you today, and welcome any questions you may have and your support. 

Thank you. 

Ms. NORTON. Thank you, Ms. Anthony. 

Mr. Baschuk. 

11

Mr. BASCHUK. Good morning, Chairwoman Norton, Congressman 

Cohen, Members of the Committee, and Committee Staff, I’m Bruce 

Baschuk, testifying in my capacity as Chairman of the NOMA 

Business Improvement District. 

As you know, NOMA, or as others call it, Capitol Hill North, is 

the Washington, D.C. neighborhood extending from just a short 

walk north of the Capitol to the intersection of New York and Florida Avenue. The views from these streets and buildings of NOMA, 

are dominated by the Capitol Dome and Union Station. 

A great new addition at the northern end of our skyline is the 

striking headquarters designed for ATF by internationally renowned architect, Moshe Safdie. Established as a result of the visionary plan for a former industrial neighborhood, NOMA represents the very best in modern urban planning. It’s proximate to 

the hub of Federal activity on Capitol Hill, in the heart of Washington, D.C.’s CBD. 

Significantly, NOMA is a multi-modal transportation hub, served 

by Amtrak, Maryland and Virginia commuter rail lines, MARC and 

VRE, respectively, at Union Station, Metro’s Red Line service at 

both Union Station and the New York Avenue Metro Station, local 

and regional bus services operating out of the Greyhound Terminal 

on 1st Street, N.E., excellent access to Interstate 395 and Route 50, 

and we are just ten minutes from National Airport. 

The Federal Government has been a critical investment partner 

in helping to establish this area, through, as mentioned earlier, 

GSA’s construction of the new Headquarters building for the Bureau of Alcohol, Tobacco and Firearms, BLS and FERC, which we 

are pleased to be in today. 

And, through its investment, along with the Government of the 

District of Columbia, and NOMA property owners, in the development of the New York Avenue Metro Station in a tri-party agreement, these investments are paying off, and paying off well, with 

over 5 million square feet of privately-owned office space built in 

NOMA we can see the vision was firmly based on a realistic assessment of user needs and the benefits of a NOMA location. Workers 

can commute to work without adding another car to our congested 

roads, even from the more affordable, more distant suburbs. 

NOMA provides significant savings to tenants, with rents that 

are roughly two thirds of Central Business District rents, mid 40’s 

versus mid 60’s. 

With Union Station at its front door, NOMA is a Central Business District location from our perspective, with access to everything, great shopping, food, more than 125 shops in the areas, in 

Union Station, some wonderful neighborhoods with lunch spots, 

and a variety of fine restaurants and hotels adjacent to NOMA, 

where it borders on Mass. Avenue. We have provided a map of 

neighborhood amenities for the record, along with my written testimony. 

Nearly 1.5 million square feet of new Class A space will be under 

construction this year. Those same developers, and other developers, are developing approximately 1,600 apartments in three separate development initiatives, and more than 120,000 square feet 

of retail space, and two hotels with 300 rooms. And, as mentioned 

12

earlier, we hope to announce the addition of our grocery store very 

soon. 

These additions, which are targeted for completion within 24 

months, will make this a dynamic mixed-use environment. With 

the addition of a significant residential, retail and hotels to the already existing and new office space, NOMA will be a new 24/7 

downtown neighborhood much like the bustling East End. 

As the desirability increases, so will the rents. When they do, 

people may say with regret, I wish we’d made a commitment to 

this area earlier. 

As Chairman and one of the founders of the NOMA Business Improvement District, or BID, I would like to spend a brief time talking about ways in which our BID will add to the exciting things 

already going on in NOMA. The effort to establish the NOMA BID 

grew out of a recognition by the property owners, many of them 

savvy institutional development entities, that NOMA would benefit 

from a local organized focus on neighborhood beautification and improvement. 

The NOMA BID, like downtown, Golden Triangle, and other 

BIDs in D.C., will work to keep NOMA a clean and safe working 

and welcoming environment. It will work to make sure that 

NOMA’s streets are lively and attractive and that NOMA is a good 

neighbor to adjacent residential communities. 

As NOMA owners demonstrated with their investment in the 

New York Avenue Metro Station, they are unusually effective in 

seeing that the whole can be better than the sum of the parts. 

Through the NOMA BID, local owners are committed to reinforcing 

the fabric of neighborhood and community, by bringing people together to support employment of community residents, celebrate 

neighborhood and residential accomplishments, and to make sure 

that NOMA is a great neighborhood for, not just office tenants, but 

everyone. 

In closing, I would predict that it won’t be long before we tell the 

story of NOMA and GSA’s location policy in these terms, NOMA 

is one of the best examples of a type of radical transformation that 

can be accomplished in an inner city, formerly an industrial area. 

Proper attention was paid to transportation, great architecture, the 

mix of uses, and the quality of community. Most significantly, public and private actors came together and collaborated on the implementation of a shared vision. By their efforts, they’ve created a 

thriving new neighborhood that is a welcome—simply just a great 

place to live and work in D.C. 

We welcome the continued involvement of and participation of 

GSA and all of its client agencies in this transformation. As significant investment partners, we encourage them to take advantage of 

current opportunities to lock in economic benefits and locational 

advantages before the values the people see increase. 

I appreciate the opportunity to appear for you, before you today, 

and be happy to answer your questions. 

Ms. NORTON. Thank you very much, Mr. Baschuk. 

Let me begin with Mr. Winstead. Mr. Winstead, let me ask how 

you, GSA, how you conceive your role? Do you conceive your role 

as a real estate agent, like the private sector, or is there any difference between somebody doing what you are doing for Federal 

13

agencies and what a real estate agent would do in the private sector? 

Mr. WINSTEAD. Madam Chairman, we, as you mentioned, we are 

governed by both FMR regulations and the Public Buildings Act, 

we are, in fact, driven, increasingly, because of just the competition 

in the market, to find cost effective economic solutions for our tenant agencies. 

We’ve adopted, in the last three or four years, major new reforms 

in terms of customer service, where we———

Ms. NORTON. Yes, well, if you are driven to find cost effective solutions, let me just ask Mr. Baschuk, would you compare the cost 

of space here to the cost of space in office space in downtown, other 

downtown areas? 

Mr. BASCHUK. Yes, ma’am. 

Again, I believe, and there’s plenty of support for this belief if 

you get quotes from landlords, that the cost of new office space, 

Class A office space, is approximately two thirds of what you would 

spend in the Central Business District for new office space, Class 

A. 

Ms. NORTON. Mr. Winstead, were you aware of that as you take 

on your mandate, as you said, to find the cost effective solutions 

for your clients? 

Mr. WINSTEAD. Madam Chairman, I’d be—we do, I mean, we are 

very committed to, obviously, looking at the right location decision, 

taking both the rent in consideration, as well as technical factors 

and operational concerns of the agencies, as well as their current 

housing needs in many cases. 

As you know, there are extension of leases in existing buildings, 

but we are—and Bart Bush can comment further, as being directly 

responsible for executing these leases, but from a policy standpoint 

we are aware of the competitive issues here in NOMA, and we 

have found, as I understand, and he can elaborate, that rental 

rates may be below market in some cases, we think $4 to $5 per 

square foot. 

Ms. NORTON. And, of course, we are talking about Class A space 

and new space, we are not talking about moving into some office 

building that’s maybe a number of years old. Virtually, all of these 

buildings are going up for the first time, just like FERC moved into 

this building as the first tenant. I remember breaking ground here. 

So, we are talking about brand new state-of-the-art space, right, 

at below market prices, in the District of Columbia, which is known 

to have an expensive office market, and where agencies, nevertheless, desire to be. 

I mean, I’d just like to know how you would explain 50 City 

blocks which have been on the market now for years, and I’m going 

to quote from Mr. Baschuk’s testimony, 1.5 million square feet of 

new Class A office projects, understand we are talking a few blocks 

from the Capitol, Mr. Baschuk talked about the view of the Capitol 

you have from the top floors of many of these buildings. 

But, we are not just talking office space, he’s talking about, ‘‘A 

dynamic mixed-use environment,’‘ 1,600 apartments in three developments of more than 120,000 square feet of retail space, that’s in 

addition to the Mall, sir, two hotels with more than 300 rooms, and 

14

Mr. Baschuk testified, we hope to announce the addition of a grocery store very soon. 

I know one thing, most Federal employees would wish that in addition to the other amenities downtown there was a grocery store, 

that’s one of the things that we are trying to get in the 7th Street 

Corridor, for example. 

So that, when I received only yesterday, I might add, an answer 

to my letter to the Administrator, who was good enough to come 

personally to NOMA to see for herself, and was apparently impressed with what she saw, nevertheless, we get a letter that says 

the lack of amenities in the central and northern areas of NOMA, 

where you have just heard testimony about Class A office space 

with amenities that would suit a family, and certainly employees 

who happen to be in the area, how then can you explain this notion 

of amenities as a problem, 50 square feet where you have to show 

for it an IRS master lease, which, by the way, has been there for 

a very long time and does not represent any new development. I 

need to know what the problem is with amenities. I need to know 

what an amenity is, after hearing Mr. Baschuk’s testimony. I need 

to know whether you knew about what is happening in NOMA before you heard his testimony today. 

Mr. BASCHUK. Chairwoman Norton, if I might, I know you have 

addressed someone else, but I do want to, in defense of our Federal 

Government, indicate that most of these developers who are putting into place the solutions that I have articulated, have come to 

this table, if you will, within the last 12 months. I want to be clear 

on that. 

Ms. NORTON. Well, let me ask you, within the last 12 months, 

let’s be fair, have you, Mr. Winstead, known of these developments? 

Mr. WINSTEAD. Madam Chairman, absolutely. I mean———

Ms. NORTON. I put no time frame on it, Mr. Baschuk, I just 

asked him if he knew. 

Mr. WINSTEAD. Thank you, Mr. Baschuk. 

I’m well aware of it, Madam Chairman, and also Bart Bush and 

his fine staff at NCR is as well. 

This is, obviously, a major market, evolving market, and the 

amenity issue is one that has been raised in the past, and is commonly included in our lease solicitation, regardless of the delineated area. We have a market under—development with both the 

commitments of $1.2 billion I mentioned earlier, as reflected———

Ms. NORTON. You have what, I’m sorry? 

Mr. WINSTEAD. —sorry, we do have major development underway, the $1.2 billion that Mr. Baschuk and others have talked 

about, in terms of grocery stores and retail that are bringing amenities to the area. So, we do understand that there has been a lot 

of recent market action that brings the kind of quality lunchtime 

and evening activity that this region will improve on, in terms of 

quality of life, both work environment, as well as a lot of residential development, before 24 hour, not just eight hour activities in 

the region. 

So, we are well aware of these developments. We are on top of 

them. We’ve engaged with DCBIA. We’ve engaged with the brokerage groups. We have ongoing efforts to keep informed about these 

developments and options. 

15

Ms. NORTON. Yes, and you’ve been engaging for a long time, for 

example, you engaged with me—when did we have the GSA, when 

we had our—when the rents were even lower, and GSA worked 

with me, precisely, because we were in a deficit, and because 

NOMA was on the cusp of becoming exactly what it is today, 

what’s that, three years ago, five years ago, and we said let’s let 

the Federal Government know first, GSA cooperated in the best 

possible way, and we invited in developers to say what is not 

planned, but what is on the drawings boards, what is going to happen. And, I’ve never seen anything like it. 

That was five years ago, when GSA saw for itself and was happy 

to cooperate, to have the Federal agencies, whom we invited to this 

seminar, come and see what was available, and yet, all we have to 

show for it is an IRS master lease and 1 NOMA Square, which has 

been in the works for some time. 

I have to ask you what you consider to be amenities, Mr. 

Winstead. 

Mr. WINSTEAD. Madam Chairman, I’d be happy to speak to that, 

but also in terms of any details that Bart Bush might provide, if 

that would be agreeable. 

Ms. NORTON. Of course. 

Mr. WINSTEAD. Great. Overall———

Ms. NORTON. If he has some details to the questions I’ve asked, 

I’d be pleased to hear it. 

Mr. WINSTEAD. Sure. Do you want to deal with that, Bart? 

Mr. BUSH. Thank you very much. 

Ms. NORTON. Let me ask you the question, what—sir, would you 

identify yourself and say what your position and role is? 

Mr. BUSH. My name is Bart Bush, I’m the Assistant Regional Administrator for PBS in the National Capital———

Ms. NORTON. All right, you answer then, what are amenities? 

What does GSA consider to be amenities? You just heard a list of 

amenities that I think would impress almost anybody. 

Mr. BUSH. Sure. 

Ms. NORTON. But, maybe we don’t consider the same thing as 

amenities as you do, so I need to know what is an amenity necessary for a Federal agency to locate in a brand new Class A building? 

Mr. BUSH. As defined in our solicitations, amenity requirement 

is, generally, expected to include a variety that is available to the 

Federal employees, commonly available in the City location, including retail establishments, dry cleaners, banks, pharmacies, day 

care, and other food establishments, within a reasonable walking 

distance, as defined within our solicitations as 2,500 linear feet. 

The offerers always have the opportunity, when they respond to 

us, to include in their development projects these amenities within 

their space, which is to be developed, meaning the amenities don’t 

have to exist already for us to consider them in our evaluation. 

Ms. NORTON. Are you aware that the District of Columbia requires that office space have such ground-level ‘‘amenities’‘ in any 

case, quite apart from GSA, and that all of these buildings are 

going to have ground-level ‘‘amenities’‘ right in the buildings? 

Mr. BUSH. We are very excited about that, and certainly we have 

heard in the $1.2 billions worth of development that is proposed in 

16

the NOMA area, extensive amenities that would satisfy our requirement, as the development projects come forward, and consider 

them. 

If you don’t mind, I’d like to address one of the other NOMA specific questions, as it related to price comparison, when we were 

talking about market rates. 

Market rates, generally, do tend to be less expensive in NOMA. 

However, it’s not really been our experience over the last year in 

our full and open competitions. We have conducted five such procurements over the last five years, or over the last year. In considering our evaluation of space, while the market rates may be 

cheaper, we also have to take into consideration the cost of relocation of the agency in our overall impact to the Federal Government. 

Ms. NORTON. So, excuse me, so these are agencies located in the 

District, who are looking for space, therefore, looking to move, and 

it would be more expensive to move to NOMA than to higher-priced 

space somewhere else in Washington? 

Mr. BUSH. My point that I’m trying to make here is that, in two 

of those instances it was cheaper for the agencies to remain in 

place, therefore———

Ms. NORTON. What about the others? 

Mr. BUSH. —therefore, not incurring those relocation expenses. 

We conducted———

Ms. NORTON. Because that’s fine, they are not in the market 

then, we are, obviously, trying to find whether or not people looking for space are, in fact, end up getting space in higher-priced 

areas in the District of Columbia than NOMA. If those people 

dropped out, they are not of interest to us. 

Mr. BUSH. Of the three remaining, two were conducted on the 

source selection criteria. One of those———

Ms. NORTON. Would you explain source selection criteria? 

Mr. BUSH. Source selection takes into a variety of criteria, including price, but as well as criteria that is established in the solicitation, including proximity to adjacent other Federal institutions 

that the agency might have to deal with, other criteria that is important to the operational component piece of that agency. 

Under solicitation———

Ms. NORTON. Yes, indeed, what you are doing is affirming what 

Administrator Doan said, procurements, let’s see what the appropriators think about this, are not always based on low price, and 

our government customers often consider both price and technical 

factors related to building attributes, and then she names proximity to clients. Now, you know, we are talking about an area located near the Capitol. And, we are talking about a small compact 

City, and the notion that you are not close to clients, when you are 

in an area close to the Capitol where agencies come regularly, is 

itself very telling. 

I have no idea what she means by technical factors, what are 

technical factors that you take into account, name me some technical factors so I can understand. 

Mr. BUSH. Let me just reference her letter, if you don’t mind. 

Ms. NORTON. You know, when you say source selection, just let 

me be clear, you are talking about something that is not price driven. Now, we understand that price is a factor, not the only factor. 

17

But, when an agency can sit down and say, and, by the way, I want 

to be near my clients, that is code for lawyers, and guess where 

they are located, not as many on Capitol Hill as on K Street. Everybody knows what that is. 

So, who pays for being close to clients? In either case, you are 

not going to be able to walk there normally. We have a state-ofthe-art Metro system, we are not talking about going out to Virginia, these people want to stay in the District, or stay put as you 

said, they don’t want to go out away from the Capitol. 

You and I know that the preference is to be as close to 1600 

Pennsylvania Avenue and the Capitol of the United States as possible, where here you are right here, within blocks of the Capitol, 

but we are told that proximity to clients can mean the difference 

in addition to price. 

I need to know the technical factors. Proximity to clients is 

spelled out. 

And, Mr. Winstead, perhaps, you weren’t here, it was the FCC, 

but we know all about proximity to clients, because GSA had a horrific experience, where it had a signed lease, built in accordance 

with the FCC, and guess what, the FCC having signed the lease 

knew exactly where it was going to be, said we are not going. So, 

the people who built the building, down now where the hotel—a 

rapidly developing area, the portals, but the hotel down there, the 

people—the Mandarin, the people who signed the lease, of course, 

took them to court and won. 

So, we know all about preferences, and we know all about sitting 

down with GSA and acting as if GSA is a private real estate agent, 

of course, on the dime of the taxpayers, and saying, look, we want 

to be close to our clients, and then there’s some ‘‘technical factors,’‘ 

and I want to know what the technical factors are. 

Mr. WINSTEAD. Well, Madam Chairman, first of all I think you 

referenced, obviously, the other decisions that had been arrived at 

through the NCR’s actions in the past. 

I’ve heard a lot of clear, over the 15 months I’ve been Commissioner, about the very strong direction and our fulfillment of that, 

of being the landlord for the Federal agency, and making marketbased decisions in the best interest of both our tenant, as well as 

the American taxpayer. 

I mean, you and I have talked a lot about———

Ms. NORTON. Is it a market-based decision to leave space unused, 

which can only be built under D.C. law if it has amenities in the 

building, and you have heard has loads of amenities and loads of 

company coming, some of which you don’t even have in most parts 

of the City, like a grocery store, how can I take your testimony that 

you operate on market-based basis———

Mr. WINSTEAD. Madam Chairman———

Ms. NORTON. —in the face of this evidence? 

Mr. WINSTEAD. —yes, well, I think that, you know, as Bart has 

mentioned, we have a number of procurements underway, we’ve 

had a number over the last two or three years. We actually provided this Committee, at your request last week, of all the lease 

actions between 2002 and 2007. 

Ms. NORTON. I would like to, I’m sorry, you have provided that? 

18

Mr. WINSTEAD. We are—we are—Bart, the NCR will be providing 

that to the Committee. There’s a lot of work that’s been going into 

that, to frame it in the way that you want it, to make it clear. 

Ms. NORTON. Within the next 30 days, I’d like to———

Mr. WINSTEAD. Oh, no, it will be quicker than that. 

Ms. NORTON. —I’d like to have, let’s say, beginning in 2002 to 

2006, your information on every prospective level lease procurement, but let me make sure I’m on the record here, every prospective level lease procurement for which NOMA, a NOMA building, 

submitted a bid, the value of the lease, the eventual winner and 

the reason why the NOMA BID was rejected. 

Mr. WINSTEAD. We’ll be happy to provide that, it’s in the works, 

and we’ll get it up as quick as possible. 

Ms. NORTON. Thank you. 

Mr. WINSTEAD. Madam Chairman, I think your point is, and I 

think what the testimony we’ve had from this panel shows, is that 

this area is no longer an evolving market, it’s becoming a mature 

market. 

Ms. NORTON. Well, just a moment. Let me just stop you right 

there. In other words, you were waiting until it became a mature 

market when the prices would go up. 

Mr. WINSTEAD. Our commitment to 2.7 million square feet already in tenancy here, including new Headquarters, are a commitment. We are actually—we’ve got ATF Headquarters, we’ve leased 

a total of 2.7 million square feet, we are very—and, as you said, 

I see this as clearly as you do, Madam Chairman, this area is proximity to the Capitol, it’s proximity to the gateway to the District 

of Columbia, New York Avenue, it’s proximity to two Metro Stations and intermodal commuter rail to Maryland and Virginia, 

make it a very, very good and competitive spot to locate agencies 

in, and that’s what Bart Bush and his team, you know, procurement specialists, are, in fact, underway. 

You know the policies we go by, in terms of the agency’s involvement. 

Ms. NORTON. Yes, I know what the Statute says. 

Mr. WINSTEAD. Right. 

Ms. NORTON. But, Mr. Winstead, you’ve got to get more specific 

here, and again, the Subcommittee is willing to help you. 

Let me ask you, maybe if you get more specific I can understand, 

what specific action———

Mr. WINSTEAD. Sure. 

Ms. NORTON. —what specific action does—listen to my questions. 

Mr. WINSTEAD. OK, I’m sorry. 

Ms. NORTON. I’m not interested in the broad policy, Mr. 

Winstead, we all know the policy. We all know you understand the 

policy. This is a case in point, and it’s very troublesome, because 

we wonder whether we should have field hearings in other parts 

of the country. 

I want to know what—since you understand the policy, since we 

are talking about NOMA, I want to know what specific actions does 

GSA take to ‘‘market’‘ an area to an agency which, of course, by 

definition knows nothing about real estate, amenities, or any of the 

rest of it, but comes to you the same way we come to a real estate 

agent, with this exception, the real estate agent is prepared to get 

19

the kind of space I can afford, the agency comes to you to get the 

kind of space the taxpayer can afford. 

So, I want to know very specifically what—how you ‘‘market’‘ an 

area like NOMA, how you have marketed NOMA since the ATF 

building RFP was approved, what have you—give me examples of 

actions so I understand what GSA does. 

Mr. WINSTEAD. First of all, we’ve had, like today, we’re having 

a locational forum, where we are bringing both developers, brokers, 

and our clients together to, obviously, show major areas of desired 

building. 

Ms. NORTON. I appreciate that you are doing that. Of course, 

that’s regional. 

Mr. WINSTEAD. Right. 

Ms. NORTON. The problem, again, and this is the lack of specifics 

here is almost annoying, the problem in the District is that there 

are more agencies than there is space to put them. Is it still the 

case that you need 10 million square feet in the District? 

Mr. WINSTEAD. In terms of—you mean there’s more opportunity. 

Ms. NORTON. No, that GSA would like—this is—I’m going back 

to at least two years ago when I was told this by GSA, 10 million 

square feet in the District. 

Mr. WINSTEAD. Yes, there is enormous, you know, again, back to 

my opening statement, you’ve asked for specifics about what we’ve 

done. 

Ms. NORTON. What do you do to market NOMA in particular? 

Mr. WINSTEAD. Number one, we’ve expanded the delineated area 

to include NOMA. Number two, we’ve met aggressively with real 

estate developers and property owners in NOMA to provide an indepth explanation of our leasing process. 

Ms. NORTON. The developers are not the problem. The agencies 

know nothing. 

Mr. WINSTEAD. Right. 

Ms. NORTON. And, therefore, they look to you for guidance about 

how much they should spend. 

Mr. WINSTEAD. Right. 

Ms. NORTON. They look to you for guidance to what kind of 

things they should look for. They even look to you for guidance 

about what part of the City, unless, of course, they have a view 

that they are to remain somewhere near their ‘‘clients.’‘

So, in order for them to move from where they are, which may 

be more centrally located, somebody has got to convince them. My 

question to you is, what do you do to convince them to move to an 

area that is developing in this way? 

Mr. WINSTEAD. We work aggressively to look at their needs. We 

do take them to tours of NOMA, as well as the other areas within 

the District of Columbia. 

Ms. NORTON. Do you talk to them about the Statute and your 

role to do more than simply show? 

Mr. WINSTEAD. Absolutely. I mean, as I mentioned, we, obviously, explain our leasing process, and how we will———

Ms. NORTON. I’m talking about what the Statute says, what the 

Statute says in terms of cost, efficiency, or national security. 

Mr. WINSTEAD. But, we do brief them through our process, in 

this case at NCR their staff is actively involved with each tenant 

20

agency’s need, through the process of defining their needs, as well 

as including NOMA within the delineated area. 

So, we are actively—Bart, do you have anything else to add to 

that from a marketing perspective? 

Mr. BUSH. As has been stated, we most certainly do reach out 

to understand what advantages have been brought to NOMA, and 

educate our clients to those advantages, as their procurement———

Ms. NORTON. So, you are just like a regular real estate agent 

then, you just educate them, and, of course, in terms of the scriptures of the Statute, in terms of cost, the problems that your agency has for that matter, and every Federal agency now has with 

deficits, do you advise them on the importance of getting comfortable space at the lowest possible price? 

Mr. BUSH. We most certainly do. As part of our charge we———

Ms. NORTON. And so, why aren’t they in NOMA then, sir? 

Mr. BUSH. —as part of our charge, we are ensuring adequate 

competition, competition is good for driving down the costs, not 

only for GSA, but our customers, as well as for the Federal taxpayer, by ensuring that we have adequate and proper competition 

we can ensure that those costs come down. 

We most certainly understand that according to FMR each Federal agency is responsible for identifying the delineated area within 

they wish to locate their specific activities, consistent with their 

mission and program requirements. 

Ms. NORTON. I don’t know, you know you are signing leases at 

a higher lease rate than a centrally-located decision, and yet you 

tell me you are getting the best deal for the taxpayer. 

GSA needs help. You are going to get some. 

Mr. BASCHUK. Congresswoman? 

Ms. NORTON. Yes, sir. 

Mr. BASCHUK. If it is at all helpful, the NOMA BID owners 

would be very glad to host the agency heads and GSA to educate 

them on the amenities and development projects that are coming 

in to this area. If that is helpful to you, it’s helpful to GSA, we’d 

love to do that. 

Ms. NORTON. Well, I just think, you know, that’s the kind of 

thing you would expect GSA to say, you know, instead they are 

doing a regional location thing. You know, we are buried by a huge 

region here, and I don’t think that helps the problem before us at 

all. But, if we want to do what we did five years ago, I would welcome it, Mr. Baschuk, and I very much appreciate your offer. 

May I ask you, Mr. Baschuk, what the average rent is, I know 

that’s difficult to say here compared to the Central Business District. 

Mr. BASCHUK. Well again, my quote of 2/3s run is based upon 

construction of a new building and, primarily, costs increases due 

to the price of ground here relative to the price of ground in the 

Central Business District. 

I think it’s only fair to point out that if GSA considers an existing building, where the owner has a much lower basis, they would 

achieve a better variance than that 2/3s, but something less than 

that, or something greater, if you will. The price difference may be 

$5.00 a square foot, but for new construction, we think it’s 2/3s, 

21

$45 a square foot would be a full-service rent that we could do for 

GSA, presuming we have some agreement on what the tenant improvement allowance is. 

Ms. NORTON. $45 per square foot, what would be the price, Mr. 

Winstead, or Mr., is it—I’m sorry, what’s your name again? 

Mr. BUSH. Bush. 

Ms. NORTON. Mr. Bush, what would be the price in the Central 

Business District? 

Mr. BUSH. May I ask, is that full-service lease that you are 

quoting? 

Mr. BASCHUK. That’s correct. 

Mr. BUSH. I do know that in our most recent open competition, 

with respect to the requirement that included a NOMA response, 

the NOMA response was more expensive than where we ended up 

selecting for one of our customer clients, and we can share that information with you. 

The quotes that———

Ms. NORTON. What is the price per square foot in the Central—

you just heard him say 2/3s. Are you challenging that, are you saying, no, they are not under market? Are you challenging the notion 

that they are under market in the Central Business District or not? 

Mr. BUSH. We understand the market to be somewhere between 

$50 and $60 a foot, depending on government’s needs, depending 

on what the fit-out requirements would be for the customer, particular customer in question. 

Ms. NORTON. Ms. Anthony, what were the main drivers of your 

selection, and just let me say, when you selected NOMA there was 

hardly a NOMA there. We are talking about the north end. ATF 

undertook to become the anchor, undertook knowingly to become 

the anchor, but people don’t decide to build just to become the anchor, or to do anybody a favor. 

Talk about your decision to locate in the New York Avenue, Florida Avenue Corridor. 

Mr. ANTHONY. Well, as you know, Chairwoman Norton, we were 

one of those agencies that had a technical factor. We had a location 

factor, which identified our delineated area, which was to be within 

some area of the United States Treasury Building, because at that 

time we were an agency of the Department of Treasury. So, we 

looked at that from a location standpoint, but we had a huge technical factor, and that was to find a location that offered enough 

land that would allow us to build a facility, a Federal building, not 

a leased building, that we could have setback. 

Having said that, however, you know, we did—one of the deals, 

one part of the deal in getting that property with the District of 

Columbia Government, was that ATF would commit with GSA to 

developing—and amenities on a ground-level location. 

Ms. NORTON. Now, understand how important what you are saying is, you are talking about a secure building, Level 4 building, 

and, nevertheless, had to develop the same amenities as if it had 

been a less secure building in the District of Columbia, because the 

District of Columbia requires that. 

Go ahead, please. 

Mr. ANTHONY. I’m going to speak a little bit out of turn, in that, 

you know, ATF hired me because I had worked for 20 years on 

22

other GSA buildings in the District of Columbia area. And, in all 

of those the NASA Headquarters at 3rd and E, S.W., and the National Science Foundation, and then the Ronald Reagan Building, 

we did have to work with GSA in all of those developments to develop ground-floor amenities and retail. 

Speaking a little bit in defense of GSA, and in some way maybe 

some help. 

Ms. NORTON. Give them a little help here, Ms. Anthony. 

Mr. ANTHONY. I think the help is that they just can’t be everything, and I think that agencies don’t typically hire people, like I 

was, who have the expertise to help define and strengthen those 

connections with the local areas that they are looking at, because 

at the time, of course, ATF, I mean, we had to put a big stake into 

the development of figuring out what was going to happen if we 

moved to an area that had nothing, even the City had nothing 

planned in that area. There was no infrastructure in that area, and 

ATF had to play a huge role in helping GSA to find out exactly 

what the issues were. 

And so, I think at the regional level, and I can’t speak for GSA, 

but one of the conflicts that we constantly had was that, you know, 

they pretty much listen, they do listen to the clients, and I think 

in trying to engage, engaging with the Chamber of Commerce, and 

engaging with the BID, and engaging in the local community requirements, was really something that, although GSA has general 

information, it was sort of—the onus was on the agency to really 

get involved with that. 

Ms. NORTON. Oh, yes, and we do understand that. The agencies 

get so involved that they are dominating the decisions, it would 

seem. 

With Mr. Cohen having returned, I want to ask my colleague if 

he has any questions he’d like to ask. I’ve been going at them. 

Mr. COHEN. Thank you, Madam Chair. 

Obviously, not having been here for your responses, I hate to be 

going over subjects, and I know the Chairwoman has made it abundantly clear that it’s important, and sometimes from the beginning 

if I missed something, there is a chicken and egg, and I don’t know 

all the history on the amenities and all the issues that have come 

up, but sometimes you have to, if you put something in an area to 

develop the amenities they’ll come, you know, build it and they’ll 

come, all of a sudden their fans in the stands, and they are not just 

playing baseball in the weeds. 

So, I think that’s maybe part of what we could see in NOMA. I 

used to be on our Center City Commission on Downtown Development, I was on it for 20 years, and in Memphis we’ve done a lot, 

but sometimes you had to have a developer, and the government 

often times is what gets it started. 

But, all politics is local, and I can’t get the GSA to have my name 

listed in the phone book. Do you think you could do something 

about that? Two months, and they still call me and say, Congressman Ford. 

Mr. WINSTEAD. It will be listed before the end of the week. 

Mr. COHEN. Thank you, as another Tip O’Neill. 

Mr. WINSTEAD. But, I do want to mention, whether it’s Memphis 

or otherwise, I think your reference to your involvement in the ecoVerDate 0ct 09 2002 16:34 Sep 20, 2007 Jkt 000000 PO 00000 Frm 00030 Fmt 6633 Sfmt 6633 P:\DOCS\34783 HTRANS1 PsN: JASON
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nomic development efforts, Chairman Norton, obviously, part of our 

commitment, Administrator Doan’s visit, my briefing here with her, 

and also the business community that was here, we are well aware 

of our role in terms of its impact from an economic development 

standpoint, a Federal tenant, a headquarters like ATF has huge 

impacts on the region, and is acting as a stimulant and a spark for 

continued redevelopment of NOMA. 

And, the amenity issues, I think, are being dealt with. They are 

being drawn in, people are committing to both residential, we require a 24-hour lifestyle here, not just an eight-hour work day. Obviously, the grocery store the Chairman mentioned is key to this. 

Obviously, eating establishments within a short walking distance, 

and Union Station, obviously, is a smorgasbord, but trying to get 

within this part mentioned, a little closer to the site is key. 

But, all that I think has happened. I think the bottom line on 

NOMA, Madam Chairman and Congressman Cohen, is that, you 

know, this area is a very desirable market within the District of 

Columbia and Metropolitan Washington Region, and we are taking 

every action we can to educate our tenants, in terms of what the 

options are here, to look at the cost effectiveness to the taxpayer 

locating here, but we are operating through our regulations, our 

procurement regulations, the role of the tenant agency to define the 

delineated area, and our review of that, as well as the other factors 

that the Congresswoman mentioned, in terms of, obviously, security, and it’s importance in the ATF decision, and how that building was designed. 

So, I think we are at a very positive stage here, in terms of the 

major questions, dealing with NOMA and I’d be happy to provide 

this Committee examples in other parts of the country, Tennessee 

and other states, about the impact of our locations, whether it’s 

ATF Headquarters, a new Federal courthouse. 

I was just up in Springfield, Massachusetts, where we are building a new Federal courthouse, and its impact on the region is enormous. Last week, Friday, we opened a new Federal office building, 

or new Federal courthouse in Miami, which doesn’t need a lot of 

economic development help, but it’s incredible the growth that’s occurring there as a result of that investment. 

So, we do take that into consideration, and we do take into consideration our procurement obligations to have full and open competition, and also to educate our tenants on all options that are 

most cost effective to them, as well as adhere to our budget process 

and procurement processes. 

Mr. COHEN. Did you make it to the Basketball Hall of Fame? 

Mr. WINSTEAD. I’m going to go within the next visit to the region. 

Mr. COHEN. Thank you, Madam Chairwoman. 

Ms. NORTON. Thank you, Mr. Cohen. 

Now, you said something in response to Mr. Cohen that is very 

important that we get to. And, that is the role of the agency in defining the delineated area. I can just see it now. 

First of all, say what a delineated area is. 

Mr. WINSTEAD. I’d be happy to, or why don’t you do it, as it 

would be pertinent in terms of NCR. 

Mr. BUSH. Yes. Most certainly we work with our client agencies 

with respect to a delineated area as described. Our first look, 

24

though, at any procurement is for an open and full competition 

within respect to the District of Columbia, the full CEA. Occasionally, we will get requests from our customer agencies to narrow 

that scope, from a locational aspect, and they bring into that discussion certain characteristics that are important to them. 

Ms. Anthony described one of those characteristics, with respect 

to ATF in close proximity to the Treasury. We have other agencies 

that most certainly have either a direct worker relationship with 

their central office, or with other agencies where they have determined from an operational standpoint close proximity will assist 

them in the delivery of their service to the taxpayer. 

From that locational decision, we ask and require from our agencies a written description of that delineated area, and a defense for 

that request before we look to narrow down from a CEA full D.C. 

solicitation to a smaller area. 

Ms. NORTON. You say you do have written justifications. 

Mr. BUSH. Yes, we do. 

Ms. NORTON. How many have you denied so far? 

Mr. BUSH. I don’t know, I do not know that. 

Ms. NORTON. Well, let everybody understand what a delineated 

area is, if you know nothing about real estate, and the average 

agency doesn’t, and the GSA says define your delineated area, or 

sit with me to define your delineated area, what is to keep—in fact, 

what is to make the agency define a delineated area in NOMA, as 

opposed to the preferred areas, K Street, Connecticut Avenue, you 

name it? 

Once you have a role in that, unless somebody is pushing back 

by, for example, strongly marketing lower price and amenities elsewhere, there is no way, unless you can give me some way, for an 

agency to do anything but define an area that they know of. That’s 

why client base becomes a code for essentially red lining everywhere else. 

Mr. BUSH. Most certainly we push back whenever an agency 

looks to narrow from a full and open competition to a smaller delineated area. 

Ms. NORTON. Oh, well, they can be a full and open competition 

in the central district of the District of Columbia, if that’s the only 

way. 

How about price? What role does price play in your judgment? 

Mr. BUSH. Without our source selection criteria, it would depend. 

It is not 100 percent, certainly, we are taking———

Ms. NORTON. What percent should price pay today? 

Mr. BUSH. I would have to look at the most recent solicitation to 

determine what that percentage was. 

Ms. NORTON. Mr. Winstead, do you mean to say reasonable or 

low price is not the major factor? 

Mr. WINSTEAD. Madam Chairman, obviously, price is a driving 

factor in our decisions, in all cases, as Bart Bush mentioned. 

Ms. NORTON. Compare price to client base, what role would price 

pay? 

Mr. WINSTEAD. Well, the fact, in terms of the factors for consideration and the criteria in the SFO actually evaluate that, and the 

delineated area is reviewed in terms of whether it’s fostering comVerDate 0ct 09 2002 16:34 Sep 20, 2007 Jkt 000000 PO 00000 Frm 00032 Fmt 6633 Sfmt 6633 P:\DOCS\34783 HTRANS1 PsN: JASON
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petition, whether it’s inclusive of NOMA, which I mentioned is now 

in our procurements. 

Ms. NORTON. Except the agency can narrow the delineated area. 

Mr. WINSTEAD. Yes, but, you know, then we can question it, and 

if they don’t like our determination there they have a review process with both the ARA, Bart, it goes to Bart in the first instance 

if it’s a smaller lease, if it’s a larger lease it comes to the Administrator. 

Ms. NORTON. So, how many of these have you turned down, if 

you can object. 

Mr. WINSTEAD. Well, what I will do, based on the information 

you’ve requested, I will make sure that we get all the lease actions 

from 2002 to 2007, and actually all the rationale for the actions 

taken. 

Ms. NORTON. And, I want to know how many delineated areas, 

I want to know what the delineated areas have been in each and 

every lease from 2002 to 2007. 

Mr. WINSTEAD. We’ll be happy to do that. I’ll get that information to you. 

Ms. NORTON. Thank you. 

Mr. Baschuk, what has been your interaction with GSA? 

Mr. BASCHUK. Well, personally, we have not had significant 

interaction, because we are just a new-founded entity, Chairwoman, so again, in their defense, we———

Ms. NORTON. When were you founded? 

Mr. BASCHUK. —we have been not yet recognized by the District 

of Columbia, based on the change in administration. We expect 

that would occur in March, but we have begun the processes of 

marketing, clean and safe, all those functions that we expect prior 

to official recognition and payment of dues. 

Ms. NORTON. Let me ask you about your actions to promote the 

area. When I visited NOMA early on, I was taken up, I guess, in 

1 NOMA Square to look over a very impressive view of Washington 

you seldom get. 

I went back again, and this time NOMA had literally a twominute film that took my socks off. In a two-minute film, NOMA 

described, this film described, again, not things that might happen, 

but showed you what it would look like, talked about a shuttle, is 

that a free shuttle, Mr. Bashchuk, that’s planned? 

Mr. BASCHUK. It’s what’s hoped for at this point. It’s not definitive. 

Ms. NORTON. That’s the shuttle going up 1st Street, this, in spite 

of the fact that you got subways on either end. 

But, what I saw was, NOMA at large with all that was happening. 

So, let me ask you whether anybody from GSA has seen that 

two-minute film, number one, or whether they regularly see the 

two-minute film. And two, what you are doing to promote NOMA. 

Mr. BASCHUK. First, the film has not been viewed by anyone on 

the outside, because there were internal members who felt that the 

film did not yet represent appropriately the development of the region. There were areas that were inappropriately defined as not including development. There were streets that were inserted where 

there should not have been streets, et cetera. 

26

So, there is some changes to the film, which you had reviewed 

in a preliminary sense, which should be completed in the next 

month. And, we would then distribute it to any and all people. 

In the interim, to answer the second part of your question, we 

have formed a marketing committee. The marketing committee includes developers who are prominent in that area, and we expect 

that marketing committee will be developing, along with a budget, 

an active and aggressive campaign to market this region, not only 

to GSA, but to private sector tenants. 

Ms. NORTON. Well, you seem to have, the private sector seems 

to regard this as a coming area, people wouldn’t be putting their 

money into buildings left and right if they didn’t believe that this 

was money well spent and money for which they will get return. 

Ms. Anthony, in your testimony you talked about being pleased 

that NOMA was in town, not downtown. Would you explain that 

distinction and why? 

Mr. ANTHONY. Of course. In 1999, of course, that northern end 

of NOMA was really the corner of the Central Employment Area, 

and we had a lot of interest since then in our own Department of 

Justice and other agencies who see the area as well when they 

have a meeting to go to, or when there is some, in our case, law 

enforcement or security conference, or some type of things that 

they see it as a really—it’s a very special location, because it’s not 

in the congestion. It’s in town, it’s very close to the Congressional 

buildings, but it’s not over on K Street, it’s not down in the real 

hub. I think that may change, because NOMA will become more vibrant and more active, but at the time, in 1999, we saw that as 

a benefit to us, that we weren’t right in the center part of the District, but we were on the edge of the District, but still within an 

area that was being developed and really was going to be very busy 

and active. 

Ms. NORTON. I want to say Ms. Anthony, I had to fight for the 

ATF, because the ATF is typical of Federal agencies, the ATF 

wanted to remain in the District, but like so many agencies one the 

main problems was enough space to build a new agency, and as 

you say, with the appropriate setback. And then, there came some 

Virginia developers, who had some land who tried to ‘‘steal’‘ the 

ATF. 

ATF fought back, insisted on remaining in the District. ATF 

fought back, I think, for the same reason that most agencies want 

to be in the District of Columbia, it’s the Nation’s Capitol. 

Your problem, Mr. Winstead, is there isn’t enough space, and 

NOMA is probably the last clear chance. As you testified, we had 

to take Department of—we had to take DHS, Department of Homeland Security, across the Anacostia to find a space big enough. 

I’m not sure that there’s anything left, but we are very fortunate 

that something is left so close to the Capitol, so much midtown, 

some would even say downtown, so close to Union Station. 

Mr. Winstead, what do you think is the strongest selling point 

for NOMA? 

Mr. WINSTEAD. Madam Chairman, prior to being Commissioner 

of Public Buildings for the last 15 months, I was involved with a 

law firm that had a lot of involvement in real estate in the region. 

I dealt a lot in planning, and like you, like the BID’s perspective 

27

on NOMA, like the actions we are seeing in the marketplace by the 

developers, that this is, obviously, a developed area with highly 

good proximity, and also, obviously, good transportation. 

You mentioned, when Lurita Doan and I met with you we talked 

about some of the options I think the District ought to proceed 

along with the BID, in looking at shuttle links, and funding for 

that through the Federal Highway Intermodal grants, which are 

possible to get subsidies for those kind of operations, as well as private contributions. 

I think it’s———

Ms. NORTON. Do you see any area of the District of Columbia 

that offers a better opportunity for Federal agencies today? 

Mr. WINSTEAD. Chairman, I———

Ms. NORTON. Taking everything into account. 

Mr. WINSTEAD. —obviously, it’s highly desirable and highly competitive in any procurement that we are considering moving forward. 

I do have to be, in terms of the NCR’s role, as being the procurement region, we have 11 regions, they are the ones responsible for 

the education of our tenants, going to the markets that have very 

good, cost effective options for tenancy in buildings that provide 

better new buildings that could provide it. 

I think that they’ve got a very firm committed focus on NOMA 

as a very desirable market within D.C., and within the Metropolitan Washington Region, and I do acknowledge, simply because of 

my background, that its proximity, its access, its transit connections, its intermodal commuter connections, make it, you know, 

very desirable urban area. 

Ms. NORTON. Mr. Cohen, did you have other questions? 

Mr. COHEN. No, ma’am, thank you. 

Ms. NORTON. Mr. Winstead, would you submit for the record 

every prospectus level lease that GSA has signed anywhere in the 

District of Columbia in the past six years? I’ve asked you about 

NOMA, this is anywhere in the District of Columbia, for space of 

any kind. 

Mr. WINSTEAD. And the delineated areas. 

Ms. NORTON. Excuse me? 

Mr. WINSTEAD. And the delineated areas. 

Ms. NORTON. Yes, please, of course. 

Could I ask you, Mr. Winstead, do you feel—is it common to feel 

pressure from agencies to move or to remain in certain parts of the 

City as opposed to other parts? 

Mr. WINSTEAD. I think, as Bart mentioned, that there are obviously operational criteria on the existing leases, there’s obviously 

economics of the current landlord and what they are offering up 

that are, you know, both economic———

Ms. NORTON. No, no, my question—you are not getting my question, I asked you whether GSA sometimes feels pressure from 

agencies to move to certain areas of the District of Columbia. In 

other words, do agencies come to you saying I’d like some space located X, Y, Z? 

Mr. WINSTEAD. I have—outside of the direct involvement I’ve had 

with you, Madam Chair, in terms of the St. Elizabeth’s Campus, 

they—a lot have not come to me. 

28

Bart may well have examples of that, I would refer to him. 

Ms. NORTON. Yes, sir. 

Mr. BUSH. It is not unusual for agencies to express levels of interest. As you can imagine, in many instances agencies’ initial preference, depending on their size requirements, is to remain where 

they are. It’s a natural progression, no change from any perspective 

is the best alternative. 

And then, from that we also have agencies who express a level 

of interest in remaining in a similar neighborhood, and those are 

the issues that we work out with them. This is a collaborative process. We need to ensure that we are obtaining the highest level of 

competition, and meeting the operational needs of the agency, as 

defined to us and defended by them to us. 

Ms. NORTON. But, it is more difficult to convince an agency to 

move to a part of town where there are not already existing Federal agencies and clients and the like. 

Mr. BUSH. I think that’s natural. 

Ms. NORTON. Yes, I think it’s natural, too, and I think that’s why 

we’ve seen this problem, despite the statutory mandate in terms of 

efficiency, cost, or national security. 

And, I want you to know that the Subcommittee believed, Mr. 

Winstead, when the Administrator came up, and seemed very 

pleased to see for herself, seemed to understand that there was a 

problem, we were very pleased to have her come, and pleased at 

her reaction there. 

And, I must say for the record, and I’m going to submit my letter 

for the record and her response, that I could not be more disappointed in her response. First, we’ve seen nothing significant 

happen, even since she visited, although, of course, this falls to you 

and your staff. 

Also, essentially, she said that price is not the—or low price is 

not the most important thing always, and had cited something 

called technical factors, building attributes, proximity to clients. 

This raises very, very real questions about what kind of help 

GSA may need in light of the statutory language. NOMA stands 

out as an area that, but for the buildings already being up, would, 

in fact, have particularly attracted public sector clients who spend 

the public’s money. It has not. 

The hope that ATF would send the right signal, the Federal investment in an extra subway stop, the fact of private sector agencies having no problem coming to NOMA, none of that has worked. 

So, the Subcommittee is very concerned. We only got a response 

from the Administrator yesterday. We’ve seen no material change 

in how the area is marketed. For me, it’s 16 years of no change, 

except now we have such a humongous deficit that I don’t think it 

can be ignored, so I just want you to know that the Subcommittee 

is considering a number of actions. The most immediate action is 

one I intend to take right now, and that is to notify the relevant 

appropriations subcommittees about leasing expenses incurred by 

agencies, even though salaries and expenses come out of agencies’ 

budgets, there is no oversight as to whether or not the amount an 

agency pays to lease space is the best economic deal for the government. That just comes as a lump sum, and the appropriation committees don’t, obviously, have any way or reason to look behind it. 

29

I intend to put least cost per square foot on at least an equal 

footing with amenities as an evaluation criteria. They clearly are 

not. I don’t think that today’s Congress would regard price as a 

matter to be simply equal. To tell you the honest to goodness truth, 

this Congress has gone to PAYGO, so we feel compelled to look in 

our respective areas for whether agencies are, in fact, saving 

money, whether or not PAYGO might apply in a particular circumstance. 

As long as leasing of space is so divided between agency decision 

and GSA, collaborative though it has to be, that we cannot know 

for sure that price pays a predominant cost. As long as that is the 

case, I believe that we are not spending the taxpayer dollar wisely. 

I do not believe that the Federal dollar should simply provide 

proximity, or should, indeed, simply provide comfort. The Federal 

dollar should make sure that all the factors are taken into account, 

beginning with price, and then, of course, including the amenities, 

the comfort to employees, public transportation, the factors that 

you are well aware of. 

Because NOMA has virtually nothing to show for an area that 

is in the midst of a building boom, with GSA looking for space 

every day, and, apparently, finding it, this Subcommittee believes 

that further action is taken—further action must be taken, and if 

I may say to all of you, to you, Mr. Winstead, to you, Ms. Anthony, 

to you, Mr. Bashchuk, we are open to your suggestions as to what 

further action should be taken. 

We simply indicated, the appropriators simply have to know that 

from year to year they can look at this matter and can question 

this matter, as they question other matters. 

But, I don’t intend to stop there, I don’t intend to engage in, necessarily, punitive actions. If statutory change is needed, I will not 

hesitate, but I do not regard the present state of affairs as satisfactory. I do regard NOMA as a case in point that cannot be ignored. 

I cannot understand how a space so close to the Capitol, with so 

many amenities which GSA itself recognized five years ago as the 

coming area, as the area to come to while the price was low, I cannot understand why nothing has occurred since, and I welcome 

your suggestions as to how to make sure that the public is assured 

that dollars are being spent wisely. 

Thank you all for coming. I particularly thank you for your testimony. 

The hearing is adjourned. 

[Whereupon, the hearing was adjourned at 11:50 a.m.]

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Æ


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