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35–924 PDF 2007

GENERAL SERVICES ADMINISTRATION’S FISCAL YEAR 2008 CAPITAL

INVESTMENT AND LEASING PROGRAM

(110–42)

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

MAY 10, 2007

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 

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 

VACANCY 

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 Page

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

TESTIMONY 

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

Administration ..................................................................................................... 2

PREPARED STATEMENT SUBMITTED BY MEMBERS OF CONGRESS 

Altmire, Hon. Jason, of Pennsylvania .................................................................... 24

Norton, Hon. Eleanor Holmes, of the District of Columbia ................................. 25

PREPARED STATEMENTS SUBMITTED BY WITNESSES 

Winstead, David L. .................................................................................................. 26

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35924.002
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35924.003
(1)

HEARING ON GENERAL SERVICES ADMINISTRATION’S FISCAL YEAR 2008 CAPITAL INVESTMENT AND LEASING PROGRAM 

Thursday, May 10, 2007

HOUSE OF REPRESENTATIVES

SUBCOMMITTEE ON ECONOMIC DEVELOPMENT, PUBLIC

BUILDINGS AND EMERGENCY MANAGEMENT, 

COMMITTEE ON TRANSPORTATION AND INFRASTRUCTURE, 

Washington, DC. 

The subcommittee met, pursuant to call, at 10:05 a.m., in Room 

2253, Rayburn House Office Building, the Honorable Eleanor 

Holmes Norton [chairwoman of the subcommittee] presiding. 

Ms. NORTON. Good morning. I want to welcome the Commissioner of Public Building Service here this morning and look forward to his testimony. I am especially eager to hear progress the 

agency has made in regard to the Federal presence in the NoMa 

Neighborhood, close to the Capitol. In addition, I want to hear from 

the agency about the progress at the St. Elizabeth’s Campus and 

the egress-ingress plans for the campus, which require the agency 

to request funds for the acquisition of two acres of land along the 

campus. 

This year’s program is very modest in comparison with other 

years. I also would comment on the fact that no new funding was 

requested for courthouse construction in the fiscal year 2008 program. I think we ought to get that around the Congress so people 

don’t keep coming to me and asking me for courthouses. The Border Station Program is the program that gets all the attention this 

year, with funding requested for seven border stations along both 

the northern and southern borders. 

There are two funding requests for St. Elizabeth’s Campus, one 

for the construction of the Coast Guard Headquarters and the 

other for funds to purchase land for road access, as I previously 

mentioned. 

Since the lease package was not until recently received, the Committee will not consider the leases at this time. 

I will limit my remarks, as I have many questions for Mr. 

Winstead. 

I am pleased to recognize now Ranking Member Graves for any 

opening remarks he may wish to make. 

Mr. GRAVES. Thank you, Madam Chair. 

I want to thank the Public Buildings Commissioner Mr. 

Winstead for being here today. I appreciate your coming in and 

providing testimony on fiscal year 2008. 

2

Each year, the General Services Administration submits to Congress a prospectus for the alteration, acquisition, design, construction, lease of Federal buildings, and courthouses. As the Subcommittee with responsibility for overseeing these projects, I believe we have an obligation to do our due diligence to ensure that 

projects are necessary and appropriately budgeted for. 

As we review these projects, we need to make sure we are getting the best value for the Government’s dollars for the taxpayers’ 

dollars. On that note, I am very interested in the results of the 

comprehensive courtroom usage study that this Committee has requested. This study is going to investigate how often courtrooms 

are actually used for official functions, and I am very interested in 

the courtroom sharing as a means of keeping the costs of courthouse construction reasonable. I think it is very important that we 

don’t overbuild when it comes to courthouses. 

Additionally, I think we should take a deeper look at the cost of 

leasing versus Federal construction. About half of the lease 

prospectuses submitted this year are for the Federal Bureau of Investigation. The FBI has been growing since September 11th, and 

it is clear that the FBI isn’t going to go away, obviously, soon, and 

their construction isn’t going to go away soon. These are large and 

expensive leases; they are costly build-to-suit leases with expensive 

security requirements. Does anybody really think that we are going 

to leave these buildings after we have put so much money into 

them? Is leasing really the best value for the Government is the 

question I have. 

For fiscal years 2006 through 2008, GSA has proposed 22 FBI 

lease projects. The estimated annual lease payments for these 

projects is $160 million. To deliver those same projects through 

construction, it would cost about $1.7 billion. That means that in 

11 years these leases will cost more than if we constructed these 

buildings ourselves. Clearly, there is a definite cost advantage to 

ownership. Colossal Government waste is involved with leasing 

over Government-owned facilities, and we do this because of ridiculous budget scoring rules that we have. 

I am looking forward to working with the Chairman in examining many of these issues as we move forward, and, again, I appreciate, Mr. Winstead, you for being here today. Thank you. 

Ms. NORTON. Thank you very much, Mr. Graves. I certainly want 

to associate myself with your comment on leasing versus construction that has turned out to be a scoring problem that is penny wise 

and very pound foolish. I hope we can find some way around it to 

save the taxpayers’ money. 

I would ask Mr. Arcuri if he has any opening statement at this 

time. 

Mr. ARCURI. No, ma’am. 

Ms. NORTON. Thank you very much. 

I am pleased to hear testimony now from Mr. Winstead. 

TESTIMONY OF DAVID L. WINSTEAD, COMMISSIONER, PUBLIC 

BUILDING SERVICE, GENERAL SERVICES ADMINISTRATION 

Mr. WINSTEAD. Thank you, Chairman Norton, Congressman 

Graves. I am very pleased to be before the Subcommittee on Economic Development, Public Buildings and Emergency Management. 

3

I am David Winstead. I am Commissioner of Public Buildings Service. I have been privileged to serve in this position since October 

2005. 

I am also very pleased to have with me Deputy Tony Costa and 

Assistant Commissioner Bill Matthews and members of our NCR 

team, including Bart Bush, Art Turowski, and others. 

I wanted to share with you both addressing some of the questions you just mentioned in your introductory remarks, but also I 

thank you for inviting me to testify here today on behalf of our 

2008 Capital Investment and Leasing Program. As you know, I 

have put to the record a full statement addressing a lot of the 

issues and background on these projects. 

I am happy to report to you today that Public Buildings Service, 

we feel, continues to have a strong operating position at the end 

of fiscal year 2006. Eighty-one percent of our Government-owned 

assets achieved positive funds from operation and our percentage 

of vacant space in our owned inventory, which is half of our portfolio, was 7 percent, which is way below the private sector standards. In addition, our cleaning operation and maintenance of our 

Federal buildings to ensure that we are meeting both safe and 

healthy and comfortable work environments was 4.2 percent below 

the private sector. 

Before I address our fiscal year 2008 Capital Program, I would 

like to share with you some of our efforts in the recent year and 

accomplishments in looking at the critical organizational support 

we have for the Federal Buildings Fund and our program, as well 

as challenges that we are having with clients, as well as meeting 

those challenges. As you know, my predecessor spent a great deal 

of time on customer relations, and a lot of the things he put in 

place we are continuing to refine. 

We have also, in the last year, strengthened our Capital Program 

delivery by restructuring the Office of the Chief Architect and adding a new position, Assistant Commissioner for Construction, to 

really focus on both the number of projects that you have mentioned—the FBI, the courthouses, and the border stations—but also 

focus on the reality of the marketplace. We are seeing huge costs 

and increase in material costs, twice as high as the CPI in recent 

years. 

Also, in order to more effectively manage our Real Estate Leasing Program, as well as the administration of the national brokerage contract, we are also strengthening and will be working this 

current year on looking at our real estate acquisition and trying to 

strengthen that with perhaps some new support internally; and 

that is in addition to our customer service efforts through Assistant 

Commissioner Martha Benson. Given the business volume, complexity of our work, and significant stakeholder interest, I think 

this area has to continue to be a major priority in the coming 

months. 

Now I would like to provide you a quick overview of sort of our 

fiscal year 2008 program. I believe these projects submitted meet 

the needs of our customer agencies and will enhance, in fact, the 

Federal real property portfolio. I would mention that we have had 

an incredible management career. Bill Matthews has been focused, 

as Assistant Commissioner, on our portfolio, looking at optimizing 

4

the value, optimizing our income from the Federal Building Fund, 

directing capital resources to the best use, and helping us overall 

to manage the continued owned inventory. 

Looking at repair and alteration section of the budget for fiscal 

year 2008, we are requesting a Repair and Alteration Program of 

$804 million to maintain and improve properties in GSA’s inventory. GSA traditionally first looks at reinvesting in our existing 

owned properties before considering new construction. A recent 

renovation of the historic Pittsburgh U.S. Post Office and Courthouse—I mentioned this to Congressman Altmire recently—was rededicated just this last year, in November, with some $88 million 

in renovation expansion. We provided through that a modern office 

space for the courts and also invested in a landmark national register building to ensure both the Federal presence, as well as to 

preserve a vital part of downtown Pittsburgh. 

In addition, GSA has had a longstanding practice of actively 

managing our buildings to reduce operating costs and energy consumption. We know that Congress and the Administration are very 

committed to looking for obvious energy saving efforts, and we are 

doing that through our 18 LEEDs buildings and all the new 

LEEDs, as well as lease these requirements that we are administering. In addition this year, we are requesting $15 million for implementation of energy retrofit in Government-owned properties, such 

as lighting control and energy management and solar systems. 

Based on our previous experience, we estimate that energy savings 

at some 70 billion BTU or about $1.1 million annually through 

those efforts alone. 

GSA is also continuing to support opportunities for solar and new 

renewable energy. In 2006, about 4.5 percent of our electricity was 

generated through renewable power and through renewable energy 

certificates, compared with a national average of about 2.3. So we 

are almost two percentage points higher than the national average. 

Turning to the new construction portion of our program, we are 

requesting a Construction and Acquisition of Facilities Program of 

$615 million. This includes funding for site acquisition, design, infrastructure, construction, the management and inspection costs for 

all our Federal facilities in our inventory, which now are over 1500. 

An example of one of most recent major construction programs and 

projects is a new headquarters for the Bureau of Alcohol, Tobacco, 

Firearms and Explosives, which will open in the next couple of 

months in the North Massachusetts area, or NoMa section, of 

Washington, D.C. As you can see on your far left, a picture of that 

new facility, it is a state of the art headquarters for ATF encompassing approximately 422 million [subsequently edited by witness 

to read: 422 thousand] square feet. 

Our largest program request this year is the Department of 

Homeland Security Consolidation and Development at St. Elizabeths West Campus in Washington, D.C. Our fiscal year 2008 program request for St. Elizabeths is for construction of the Coast 

Guard Headquarters and Command Center and the design of the 

DHS Headquarter elements, infrastructure work to facilitate development and funding to purchase an additional site to facilitate 

egress and ingress into this proposed new campus of DHS. 

5

That second overview is a picture of the St. Elizabeths campus, 

the middle photograph. 

GSA is also requesting funds for site acquisition, design, and construction of seven land ports of entry and funding to complete the 

consolidated FDA Headquarters at White Oak, which is about a 

$1.1 billion overall project new campus for the Federal Food and 

Drug Administration. 

In our Courthouse Program, the President’s budget contains 

funding to begin construction of the Buffalo Courthouse. As you 

know, GSA funded this project in fiscal year 2007 spending, instead 

of 2008. 

As you turn to our Leasing Program, as I testify here today, I 

will tell you our leasing portfolio is now a little bit above our owned 

portfolio for the first time. We continue to acquire leased space for 

our customers, and in order to meet these space requirements, we 

have entered into more than 8500 private sector leases in some 

7100 locations nationwide. We are very pleased, however, that the 

management of those lease actions, in terms of vacant space within 

our leased inventory, has been at or below 1.5 percent for the last 

four years, well below the national average of vacancy of about 11.6 

percent. So we are managing these Federal leases in a very tight 

manner to ensure that we have fully occupied space under these 

lease contracts. 

This year we are submitting 13 lease prospectuses and one alteration and lease space prospectus for your consideration. 

In conclusion, GSA is always seeking ways to increase investment capital, to address our liability for Repair and Alteration. It 

is a fact that we now have over $1 billion [subsequently edited by 

witness to read: $7 billion] a year in terms of reinvestment needs 

in our inventory. Obviously we do not have quite that number in 

terms of this budget, so we are constantly looking at ways to restructure and access underutilized assets, our Tier 3, as we call 

them, and reinvest that into our owned assets. 

We are also currently exploring the use and appropriate ways 

under existing authority to expand our program, both looking at 

obviously the authority we have to retain the revenues from disposal of properties, which in the fiscal year 2005 appropriations bill 

gave us that authority, as well as exploring some additional authority under that disposal which allows for out-leasing assets and 

lease-back for improved space to help to look at potentially funding 

reinvestment in this owned inventory. 

Congress has periodically recognized the need to intervene where 

there is rapid growth in government programs and emerging public 

priorities in terms of direct funding where we have exceeded the 

capacity of the Federal Buildings Fund. 

GSA continues to collaborate with our client agencies to address 

customer financial constraints, while preserving necessary capital. 

I have spent a lot of time over the last year working with the Federal judiciary in a very aggressive partnership to contain costs and 

to work with them to both administer our program and build 

through Design Excellence new courthouses, but also to reflect a 

sensitivity to their rent and delivering these projects on time and 

on budget. 

6

We have identified opportunities to consolidate requirements, to 

reduce underutilized space, to minimize tenant improvement costs, 

and expiring space assignments, and we look forward to working 

with the Subcommittee on solutions that enable GSA to address a 

growing inventory and infrastructure liability, as well as the requirements of special purpose facilities such as Federal courthouses 

and border stations. 

Before I conclude, I would mention that I am also pleased to provide to the Committee copies of some documents that we find very, 

very useful, both in terms of our stakeholders here in Congress and 

our clients. I do have copies of a number of documents. One is the 

state of our portfolio that essentially addresses some of the facts 

that I have said in testimony about the health of our Federal buildings. This last year we are now focusing on a new effort called 

Workplace Matters, where we essentially have a program where we 

are implementing workplace solutions with our clients so they can 

get more utilization out of the space they currently have in either 

owned or leased inventory. 

Lastly, as you all know, for 15 years now we have had a Design 

Excellence program which has been recognized by the architectural 

profession as one of the—and in fact put us in the lead in terms 

of landmark Federal structures that are receiving awards from the 

AIA and many other organizations. In fact, this morning, the 

Urban Land Institute is awarding an award for one of our buildings. Every two years we have a design award that we do with our 

new construction. I am also giving you all a copy of our new design 

awards to look at. 

Madam Chair, Ranking Member Graves, Congressman Arcuri, I 

am very pleased to be here and I hope that this has given you some 

background on our 2008 request. I would be happy to answer any 

questions. 

Ms. NORTON. Thank you very much, Mr. Winstead. As you know, 

you are about to embark on the largest building program I think 

in the history of the agency with the St. Elizabeths campus. That 

would mean building not one agency, but a compound of agencies. 

I don’t think there has been a building effort like that by the Federal Government since the Pentagon. 

We have seen some recent spike in construction costs—they can 

be expected over the years when construction will take place—of 

the several agencies, beginning with the Coast Guard, that will be 

built. I would like to know how the cost of construction today has 

affected your Capital Lease and Investment Program on the one 

hand and, on the other, whether you have looked into ways of mitigating or alleviating the pressure of the rising cost of construction 

both in leases and now as you begin a construction program of your 

own. 

Mr. WINSTEAD. Chairman Norton, as I mentioned earlier, we 

have seen an enormous increase in the marketplace over the last 

three or four years that is in fact doubling the CPI; 5.7 percent increase in construction average nationwide compared to 2.3 for the 

CPI. In Southern California, where we have seen a lot of competition with billions of dollars of school construction competing for our 

Federal construction leases out there on new projects, we have seen 

7

over 12 percent increase in steel, which has driven up. So we have 

had to manage these projects with some new oversight. 

That is why I created this Assistant Commissioner for Construction who is now in place, Bob Fraga, who has put in place many 

more controls in terms of both looking at variance of projects along 

the way, looking at how we can shorten the design process so that, 

as we start a new courthouse, it traditionally takes six or seven 

years. We try to do the design work much quicker so that the end 

results in the marketplace and better, obviously, meets the prospectus level funding that we have gotten authority from you to deliver this project. 

I will tell you that the recent years, as you have just mentioned, 

have been extremely challenging, but I think with these new mechanisms in place, and what we have had in place before, I think we 

are going to be better able to control these projects moving forward. 

Also, we do not expect, in the coming year, quite the level of multiples over the CPI we have seen in material cost increases. 

Ms. NORTON. Why don’t you expect those in the coming years? 

Mr. WINSTEAD. Our AC does not feel that it will be quite the 

same as it was in 2006, where we saw some 10 percent increase. 

Ms. NORTON. What caused that in 2006? 

Mr. WINSTEAD. Well, as I mentioned, I think competition in certain markets. Obviously, the consumption of material, steel, 

glass——

Ms. NORTON. The reason I ask, Mr. Winstead, is because what 

I think we all are going to have to get used to is not some hunch 

that school systems are also building where we are building and 

calling upon the same resources, but the Chinese are in the market. 

Mr. WINSTEAD. Oh, you are correct. 

Ms. NORTON. They want all the wood; they want all the steel. 

Mr. WINSTEAD. Yes. No question. 

Ms. NORTON. So in calculating the costs, it seems to me one has 

to have a global vision as to how costs are driven up. I mean, everybody is applauding biofuels, and then we find that the cost of 

corn is going up. I don’t know what is going to happen to poor people who depend upon corn in other countries; it is an ingredient in 

much food that we eat. 

So in a real sense it becomes very much more difficult to control 

costs when you are not even dealing within a regional or national 

market. Is this new Commissioner prepared to look at how the 

global marketplace will affect costs, especially as you embark with 

steel and concrete? You are going to be maybe 20 years building 

St. Elizabeths campus, for example. 

Mr. WINSTEAD. Madam Chair, I think you are absolutely correct. 

The growth in China and India and other parts of the world that 

are consuming these products are driving up the prices for American construction here in the U.S. But I do feel that the tracking 

mechanisms of variance, in terms of project costs, the way we are 

reviewing them, we recently had a charrette with industry leaders 

from the construction industry, members of the AGC, to come and 

to help share with us their perspective on how they in the private 

sector are dealing with these cost issues. It is going to continue to 

be a challenge, but we are doing the best we can, and I think we 

8

both have internal professional support, real estate and project 

management support, as well as outside advice, to try to deal with 

it. 

Ms. NORTON. I know we are building in different parts of the 

Country and different regions. One wonders if there is not a way 

to somehow get the advantage from being the Federal Government 

in the amount of—the decentralization of the way, of course, we 

have to build may mean that the savings that would otherwise 

come, for example, to a major corporation who was building in various parts of the Country, might not come to us depending on 

whether or not there is some way for our role in the marketplace, 

wherever we happen to be building, whatever is the regional basis 

for the particular contracts, unless somehow we can bring to bear 

the fact that it is the Federal Government and the fact that we are 

major players, somehow, if you look at us nationally in the marketplace. 

I am hoping that your new leasing commissioner, or whatever is 

his title, can somehow make the economies of scale come to play 

here. 

Mr. WINSTEAD. Madam Chairman, on the point, you are kind of 

referencing supply side management, and one of the things we are 

doing more is looking at obviously the quantity, the hundreds of 

millions of dollars of building materials and projects we are building to manage that in terms of contracts, and we are doing that 

a lot more aggressively now than we were three years ago. That 

is part of it. I mean, we do understand the leverage we have with 

$2 billion in the marketplace than we should get economies. 

The other thing we are doing that is new from the last year 

when I was here is in the ports of entry. Although we continue to 

design them under Design Excellence, we are looking at more 

modularization of the components in a port and, in so doing, trying 

to get economies from port to port instead of reinventing the wheel, 

if you will, every time we go to procure or have bids out for a new 

land port of entry. 

Ms. NORTON. Let me ask one more question then round and then 

go to the Ranking Member. 

I am sure the agency was embarrassed—I certainly was—particularly after the hearing we held on NoMa, to see a two-day story 

recently in The Washington Post about employees at the Equal 

Employment Opportunity Commission—and I am embarrassed because I once chaired the agency—who were up in arms about coming to NoMa cast doubt on the marketing and, frankly, realtor 

skills of the GSA. Now, here we have a part of Washington which 

the Federal Government has invested heavily, where the way has 

been broken open, even before the Federal Government put the 

ATF there, put the new New York Avenue subway there, broken 

open by the private sector, the CareFirsts of this world, with, of 

course, some Federal agencies there. 

I have to ask you what was your outreach to EEOC in specific 

terms? What did you do? How did you handle that? 

Mr. WINSTEAD. As you know, the National Capital Region has 

been working very, very closely with the EEOC. In fact, I believe 

by week’s end we are going to have an action on the EEOC, and 

9

Bart Bush is here and his people, if you need any additional information on that. 

Ms. NORTON. We were very pleased to see, finally, an agency 

come forward, perhaps before you became commissioner, five years 

ago, when the GSA joined with me in having a forum, inviting in 

all of the developers who were already bringing amenities there 

with nothing. We are talking about the area in downtown closest 

to the Capitol of the United States. So that meant that somehow 

marketing of the kind that—again, the local real estate community, 

in whom I understand you are increasingly relying, would never 

have abided. 

I mean, if you are trying to market a place that people don’t 

know as well, you have got to do it, it is not going to do it for itself. 

Of course, there is a lot of knowledge on the part of the Committee 

about what is happening there, but there seemed to be almost no 

knowledge on the part of EEOC employees, and the chairman of 

the agency was left on her own. I am about to send a letter over 

there in which I describe some of what has been happening. But 

she seemed to be left on her own to handle this matter. 

I called the BID—BID stands for Building Improvement District—and they are ready and willing to go, and I said, my goodness, why are we fighting this war about a part of the city where 

they ought to be given the prices closest to the only thing even remotely resembling a mall in the District of Columbia, two subways? 

What in the world are they fighting about? And if the GSA can’t 

handle that, what are they going to do when we send a hundred 

and some thousand Federal employees out to St. Elizabeths, which 

is indeed a new area for the Federal Government, across the Anacostia? 

It did not exactly inspire confidence in the skills of the agency 

to market property that the United States Government says is 

where it wants Federal agencies to locate because we have spent 

our money in order to accommodate their location there. I have got 

to find out what happened to the EEOC. 

Mr. WINSTEAD. Madam Chairman, I will make sure that I get to 

you and the Committee exactly what meetings were held with the 

chairman of the EEOC in terms of discussion about locational options, and I will be happy to——

Ms. NORTON. Well, of course, the chairman—Mr. Winstead, I 

want you to answer the question I am asking. The chairman did 

her job. She knew that Federal agencies don’t have the funds in 

their budget in order to accommodate the K Street rents. She went 

and did the right thing. So I am not worried about her. I want to 

know what you did and what you offered to help her and the agency prepare the employees to come to NoMa, not exactly the end of 

the world; I can walk there from here. 

Mr. WINSTEAD. Well, Madam Chairman, I do know that the NCR 

and their customer service and leasing team were actively engaged 

with the EEOC. Obviously, it did not translate into full understanding at the Commissioner’s level or the chairman’s level, or the 

employees, and we will redouble efforts. 

I do want to make two comments. We have put a lot of effort on 

customer relations and outreach and engagement, and if we were 

deficient with the EEOC, we will certainly——

10

Ms. NORTON. Well, do you not see that you were deficient with 

the EEOC? If we were deficient? If you have not learned anything 

from the EEOC experience, then how is the Committee to have confidence that you are prepared to handle, if I may say so, St. Elizabeths? Because that is, it seems to me, a much more difficult task. 

Mr. WINSTEAD. Well, all I can do is to commit to you that we will 

redouble efforts——

Ms. NORTON. Well, let me ask for more than a commitment. I 

would like to see a plan from the agency on preparing employees 

to understand the parts of the city in which they are moving if 

those parts of the city don’t happen to be smack dab in the middle 

of K Street and Connecticut Avenue. I mean, it ought to be clear 

that the employees need some help. 

What does the agency head know? The agency head is in the 

EEOC business, so the agency head cannot be expected to anticipate that employees will go up there, look and see a vacant lot or 

so, without understanding that there is a new grocery store coming; that there is rental housing coming; that there is going to be 

a shuttle; that every building there has amenities on the ground 

floor; that we will not approve prospectuses if they don’t; that 

CareFirst is there; that CNN is there; that NPR is coming; that 

CBS is coming. You know, they don’t know any of that. 

And if you are professional real estate people, it is not the EEOC 

chairman’s job to do that. And, now, what she is having to do is 

to deal with the backlash that never should have been there before. 

Frankly, I am really outraged. I am outraged because we just 

had a hearing on NoMa. I am outraged because I took my own time 

and effort, the effort of my staff and committee five years ago to 

work with your agency in order to prepare NoMa, and here we 

have The Washington Post telling people that it is not the place to 

go because there are vacant lots there and McDonald’s. It is a terrible, terrible comment and a huge failure on the part of the agency. You need to know it, and within 30 days I want to see a plan 

for how you are going to do outreach to employees to prepare them 

to understand what is present in new areas if those areas are not 

the areas that are traditional areas for Federal agencies. 

I will ask Mr. Graves if he has any questions at this time. 

Mr. GRAVES. Thank you, Madam Chairman. 

My main question is what I brought up in my opening statement, 

when it comes to leasing versus ownership. Obviously, the numbers 

bear out that over the long run it is cheaper if we were to build 

some of these facilities rather than leasing, but I am curious if 

there are any other savings. I mean, are you looking at anything 

differently? Would we be better off owning these facilities rather 

than leasing them? 

And kind of as a follow-up to that, too, I know the scoring is obviously an issue and you have constraints there. What do we need 

to do legally to change and help that. 

Mr. WINSTEAD. Congressman Graves, I know that you are concerned about the FBI leasing program as specific in terms of being 

a lease-construct versus Federal construction. I will tell you that I 

would be happy to provide to counsel and the Committee a very sophisticated economic analysis that we go through as part of the 

prospectus process. It is called The Automated Prospectus System, 

11

or TAPS, where we actually look at present value calculation in 

terms of the options of owned versus lease-constructs versus lease 

actions, and we look at values comparing basically constructing a 

new building with altering an existing or modernization, and what 

payback that has over a 30-year life cycle and present value, as 

well as leasing a building. So we go through this kind of analysis 

and cost out each alternative over the 30 years, including reversionary value to buildings. So we are looking at that on every 

project. 

In terms of the FBI program specifically, you know, we do have 

part of the FBI program—and I was not here when we negotiated 

this initially with the FBI—was to deliver on a huge number of facility needs that they needed over a short period of time. Some of 

this was driven by new requirements after 9/11 in terms of security. These campuses are largely secure outside of major areas, 

where traditionally the FBI has been in some of our Federal buildings in downtown. We were asked by Director Mueller to do this 

on an expedited basis, and he actually had a goal of having this 

program in place and largely completed by the time he completed 

his term. 

So we have been working on a number of prospectuses, some 22. 

I will tell you that we got into this because, number one, we had 

a schedule issue in terms of delivering these projects on a very 

tight time frame, and we felt that the lease-construct approach and 

leveraging the private sector in that regard could do that quicker. 

In addition, we are constrained, as you suggest, by the scoring 

issue and about the Federal Building Fund resources to deal with 

a program of this magnitude. If you look at these 22 projects and 

you look at the fair market value of them under the analysis that 

we did, the TAPS analysis, it is about $1.7 billion in annual rent. 

As a comparison, it is about $158 million for that portfolio of 

projects. 

So, when we got into this program, we were dealing with their 

needs and direction that they were giving us, the time schedule, 

plus the fact that to move ahead on this we were committing the 

Federal Government to aggregate $159 million of lease payments 

annually versus $1.7 billion in federal construction. So it was really 

a question of availability of resources in the Federal Building 

Fund, the schedule, and their program and what they needed. So 

we have entered into this lease program. 

With that said, you know, there may well be, in the out portions 

of this, a way that we can look at the construction based on schedule and see if there are any savings and capabilities in the Federal 

Buildings Fund to look at that again. But these figures I have just 

given you include lease-construct of all those 22 locations. 

Mr. GRAVES. I didn’t know if you were looking down the road. I 

understand trying to get them in something and get them up and 

going. Obviously, to go into a lease, you can get them going quicker 

than building a building that may take two years. Is it something, 

though, that you are looking at more long-term now? I mean, obviously, that is not going to go away and they are going to keep expanding. 

Mr. WINSTEAD. Yes, I think it is. We also obviously—I will just 

give you two cases in point that sort of illustrate this. Houston, 

12

Texas occupancy for fiscal year 2008—this is the FBI facility—leasing on that particular property will be $121 million new construction. So we actually saw an annual cost advantage of about $1.7 

million. 

In addition, on the San Diego side, we saw the equivalent of an annual cost saving of about $900 million going with this approach 

in the short-term. But we will be looking in the out years part of 

the program to see if we have the resource in the Federal Building 

Fund and, in fact, if a wholly-owned Federal facility makes more 

sense, and we will obviously be bringing that back to the Committee. 

Mr. GRAVES. Thanks. 

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

Mr. Arcuri? 

Mr. ARCURI. Thank you, Madam Chairwoman. 

Mr. Winstead, thank you very much. Good to see you again. 

Mr. WINSTEAD. Nice to see you. 

Mr. ARCURI. Thank you very much for being here. I have just a 

couple of questions that are somewhat unrelated. The first one, can 

you tell us to what extent does the agency try to follow a ‘‘buy 

American’’ policy in terms of the contracts and the projects that 

you are working on? 

Mr. WINSTEAD. Well, obviously, we have in our procurement, 

both evaluation for locally procured projects and that is also a part 

in terms of our sustainability goal, to look, in Federal construction, 

to look for a U.S. product in the local market. So I think we proceed on that basis with all of our projects. 

Mr. ARCURI. To what extent do you comply with it in the past 

10 years, the percentage of goods that you purchased that are 

American as opposed to non-American? 

Mr. WINSTEAD. In terms of percentage? Congressman, I can’t give 

you that here, but I will definitely get that figure back to you and 

your staff. Do we have it on a specific project? No. 

Mr. ARCURI. Okay. 

Mr. WINSTEAD. But I will get that back to you. 

Mr. ARCURI. Thank you. 

My next question is how does your agency incorporate energy efficiency into your design program? 

Mr. WINSTEAD. Congressman, we do it under two ways, we do it 

both through our new construction—three ways: through our new 

construction in terms of LEEDs requirements; we try to obtain silver LEEDs; and one of the things that I am particularly interested 

in this area is to continue to try to quantify the payback and the 

savings under LEED certification. 

We are beginning to see that there is more data and essentially 

more interest in sustainable buildings. About 40 percent of national 

consumption of energy goes into our built environment, both residential and commercial. Seventy percent of that 40 percent consumption is in electricity. So what we have been doing since 1985 

is retrofitting all of our lighting in our Federal buildings to save 

on energy utility costs. 

We are moving aggressively in terms of solar. We have a new 

building called NARA in Waltham, Massachusetts that has a solar 

roof that is essentially embedded in the rubber membrane of the 

13

roof; it is not one of these panels, it is in fact the roof. In technology like that we have to take the lead on, and we are. We have 

recently participated in the Green Building Council in Denver, Colorado and had exhibits on all of our 18, now, LEEDs buildings. 

In the renovation process we focus on it as well. We look at, obviously, when we are renovating a building, new chillers that have 

high energy efficiency; we look at basically any kind of glazing of 

windows, retrofitting glazing to save on cooling and heating and insulation factors. On the lease side we are working with lease provisions that will in fact drive potential landlords and developers to 

provide more energy-efficient buildings. 

So in all three areas we are really trying to push the envelope, 

and I think the Federal Government is regarded as a leader in this 

area, and I can certainly provide great examples of that. In fact, 

the ATF building has a lot of the new one and NoMa has a lot of 

those new systems in place, and we will continue to demand it both 

in terms of LEED certification for new construction and in terms 

of our lease actions. 

Mr. ARCURI. Would you consider energy efficiency to be one of 

your priorities in terms of your design of new buildings? 

Mr. WINSTEAD. In terms of new buildings? 

Mr. ARCURI. Yes. 

Mr. WINSTEAD. Yes. Absolutely. Again, it rests on this huge percentage; 40 percent of energy consumption is going into basically 

our built environments, so we are consuming a huge portion of it. 

The more we can do, whether our 1500 buildings, you know, obviously, that pays off in terms of overall goals. 

Mr. ARCURI. One last question I have. I understand that you use 

independent or private realtors at times in terms of finding space 

or selling buildings. Does that continue? 

Mr. WINSTEAD. Yes, sir, it does. Both in terms of disposal and in 

terms of lease acquisition, we do use a broker. As I mentioned to 

you, I think, when I met with you, we do have a new program that 

is about two years old and a national brokerage contract where we 

have selected—we had a competition and four firms won it, and we 

are essentially using them in a leveraged capability to get the best 

deal in the marketplace for us, and it is proving results. I have provided, I think to this Committee, I think the agency has, and we 

will continue to, an update on the results from the national brokerage contract. But we are seeing, in some cases, savings way below 

our target. 

Back to Chairman Norton’s issue about leverage in the marketplace in leased actions, that is where we really do have leverage, 

and we are seeing—our target is about an 8 percent savings below 

market. In some of these national brokerage lease actions we have 

seen 13 percent. So we are actually seeing 2 or 3 percentage points 

savings. 

Mr. ARCURI. And does the amount that you pay vary from market to market, depending on where in the Country the realtors are 

being used? 

Mr. WINSTEAD. Yes, absolutely. Obviously, in the major urban 

markets, the cost in Lower Manhattan, where we are now negotiating a 600,000 square foot lease to reoccupy at The World Trade 

Center, you know, leases up there are $80 a square foot versus 

14

other parts of the Country where they are much less. So we do go 

in the market, we look at both comparative and appraisal market 

rates; we do judge the leasing actions and what the brokerage are 

giving; we review the kind of rate we are getting, as well as their 

action in terms of what they are——

Mr. ARCURI. So you pay a prevailing wage, so to speak, to the 

realtors, depending on where they are. 

Mr. WINSTEAD. Yes. In terms of the commission rate within that 

market, yes. And that is reviewed by our staff. 

Mr. ARCURI. Thank you. 

Mr. WINSTEAD. Thank you. 

Ms. NORTON. In light of Mr. Arcuri’s questions on energy, I am 

going to be holding a series of three hearings on energy, but I am 

going to begin with energy conservation. Something akin to the fascination with technology has developed in the green movement, and 

that is there are all these wonderful things we could be doing, and 

if big players like the Federal Government had been even more energetic—and, yes, the Federal Government has indeed tried to 

some of this—then, of course, we would have driven down some of 

the costs of some of the more expensive ways to conserve energy. 

My concern is with ordinary energy conservation in, for example, 

the Federal inventory of buildings. What, if any, guidance is given 

to Federal agencies about common sense things that could save 

millions upon millions of dollars, like when to turn off lights, about 

heating and air conditioning temperatures to maintain, about who 

to be responsible in each facility for energy, is there an energy officer, for example, in every courthouse, or someone assigned that responsibility. 

Some of us remember when there were long lines during the 

Carter Administration and the President put on sweaters. You 

know, we saved a lot of energy during that period, when he set the 

example that you didn’t have to put your heat up to 80, you could 

put on a sweater and save fuel. 

What written or other guidance do we give this huge inventory, 

those who occupy this huge inventory of Federal buildings around 

the Country and around the world? 

Mr. WINSTEAD. Madam Chairman, we do have, both in our Applied Science Division, where we have energy experts, Kevin 

Kampschroer we do have within our Building Operations Section 

that reports to Bill Matthews, guidelines that obviously we are trying to manage our properties and ensure——

Ms. NORTON. Give me an example of what you are talking about. 

I gave you examples of what I was talking about. For example, 

does everybody in a Federal facility in this region have any guidance on turning lights out at night? 

Mr. WINSTEAD. We do have a constant sort of regulation in terms 

of the local building manager in each of our properties that we are 

working with in terms of guidelines on contributing to the cost savings in terms of turning off lights. 

Ms. NORTON. When are lights supposed to be shut off in buildings unless somebody is in the building doing work in Federal 

buildings in this region, for example? 

Mr. WINSTEAD. Well, obviously, the older buildings don’t have the 

same controls. A lot of our newer buildings have——

15

Ms. NORTON. We understand. Here you are getting back into 

technology again. I am not talking about controls. I am talking 

about you go past buildings and you see lights on. 

Mr. WINSTEAD. Right. 

Ms. NORTON. And you say, boy, those are some hard working 

people in there with all those lights on, until you recognize that 

there probably aren’t any people there at all and that some building superintendent who was in charge of making sure that all 

lights were out by dah-dah-dah, you tell me, would save the Federal Government money instead of running them all night. Not to 

mention computers. Is there any guidance on shutting down computers? 

Mr. WINSTEAD. Yes, there are, Madam Chairman. We do 

have——

Ms. NORTON. What is that guidance specifically? 

Mr. WINSTEAD. I don’t know on the timing. I don’t think it varies 

in terms of an hour of the day, but obviously Federal employees are 

instructed to turn off their computers to save energy. 

Ms. NORTON. By whom? 

Mr. WINSTEAD. By both the agency head in terms of guidelines, 

as well as, obviously, our building managers that are in our buildings who, you know, are in there and obviously trying to enforce 

turning off lights, as well as, obviously, computers, and trying to 

save energy. 

Ms. NORTON. Mr. Winstead, would you get me whatever written 

guidance already exists on that score? 

Mr. WINSTEAD. Sure. I would be happy to. We will be happy to 

get it to you, Chairwoman Norton. 

Ms. NORTON. And, again, I ask for that within 30 days. 

Mr. WINSTEAD. All right. 

Ms. NORTON. Until the notion of energy conservation became 

what it has today become, an extraordinarily urgent one, we 

couldn’t blame GSA or anybody else for putting an emphasis in design in the 20th century sense of the word. What are you doing 

now, or could you do, to shift the focus away form the way a building looks or its aesthetics to how it performs. You have got to 

spend money on something or the other, particularly today, when 

there are going to be great restrictions on how money is spent. 

Have you considered the tradeoff between usual design and aesthetics on the one hand and the performance of the building with 

respect to energy, for example, on the other? 

Mr. WINSTEAD. Madam Chairman, we do, obviously, through our 

Design Guide and through the execution of our Design Excellence 

Program, we are focused much more on not only LEED certification 

solutions and energy efficient systems in the buildings, but also on 

that issue you talk about, and that is that form should follow function, and it shouldn’t necessarily be driving complicated buildings 

because their design are in fact more difficult and more expensive 

to cool and heat. 

I think I share with you some of that concern and reflection. I 

think there are some instances over the last 15 years that we have 

in fact designed some buildings that are aesthetically striking and 

beautiful, but, in fact, in terms of maybe some of the components 

of some of these courthouses they are not as efficient because of the 

16

design. So we are focused on that and ensuring that that not happen in the future. 

Ms. NORTON. It does seem to me that in your RFPs, to the extent 

that an RFP reflects the interest of the Federal Government in this 

kind of building performance and the tradeoff you are willing to do 

to get that given the costs of construction that you just testified to, 

for example, you would move us, it seems to me, very substantially 

now—go ahead, sir. 

Mr. WINSTEAD. That is actually in the P-100. We are actually revising that right now, which has a lot of these guidelines, and I 

would be happy to get you a copy. 

Ms. NORTON. We would be very much interested in seeing that. 

Well, this is one of those times when the bell rings and even the 

congresswoman from the District of Columbia has to vote because 

it is a vote in the Committee of the whole. It will be a vote of about 

20 minutes. 

Mr. WINSTEAD. All right. 

Ms. NORTON. And I will be back. So we will recess the hearing 

for another 20 minutes and we will return. 

Mr. WINSTEAD. All right. 

[Recess.] 

Ms. NORTON. The Ranking Member gets to vote on a few more 

things than I do. I finished with the part that I can vote on and 

he has left word that we should certainly proceed. 

I had, I think, left off asking about energy. It would just help us, 

as we prepare for these hearings, to also know about some of what 

you are already doing in implementing your energy initiatives into 

new construction. I know I am quite aware that you have been 

doing some of that for years now, so if you would get us the written 

information on what you are doing, that would be helpful to us. 

Mr. WINSTEAD. Madam Chairman, I will get that to you, and I 

did mention there is a letter which I talked to counsel about that 

I will get to you that essentially provides the guidance that you 

were asking about to both our building managers and our tenants 

on the energy conservation issue. So I will get that letter to you. 

It was sent out about 18 months ago. 

Ms. NORTON. We would very much like to have that. 

Does GSA have all the authority it needs to implement the highest and best use of energy conservation initiatives? 

Well, most of this you have been doing a great deal of this—let’s 

say you were doing it the 20th century way, which was ahead of 

most developers. Now you see private companies leaping ahead. 

You, yourself, mentioned in your testimony that you believe that 

the ATF building will qualify as within the LEED family of buildings. 

Have you considered, given the urgency now attached to conservation in many different ways, the competition you are going to 

meet in the marketplace for fuel, the uses of scores of materials in 

cleaning, in building, the new approaches to energy conservation 

that are being incorporated into buildings? Do you believe you have 

all the authority you need to do whatever you need to do when 

these new ideas begin to come forward? 

17

Mr. WINSTEAD. Madam Chair, I do think we do overall, in terms 

of both the Energy Policy Act of 2005 and the Executive Order that 

was passed this last January. 

Ms. NORTON. How is the Executive Order enforced? 

Mr. WINSTEAD. There are guidelines. There is an interagency 

panel that is actually caucusing with all the members of the Federal Property Council to make sure that the Energy Initiative Executive Order is implemented. So I do think we are abiding by and 

do have the authority to achieve the kind of objectives we want. In 

truth, as you suggest, we are actually driving the market. We are 

insisting on these LEED certifications. By doing so, both the contract construction side, as well as the landlord development community, are having to meet it. 

In testimony before the Senate, there was one minor change that 

we had in terms of the term from a 10 to 20 year, I guess it was 

a tax credit. It was part of my Senate testimony that I will make 

part of the record. There was one thing that our people did feel 

that would help us to amortize those energy costs over a longer period than just 10 years. That would have helped. We suggested 

that to the Senate. But outside of that, both with the Energy Policy 

Act Executive Order and our construction and lease provisions, I 

think we are able to achieve those objectives. 

Ms. NORTON. Have you asked for the tax credit in your Senate 

testimony? 

Mr. WINSTEAD. Madam Chair, this has to do with contracting authority for buying power. Now it is limited to 10 years. We have 

actually asked for legislation considering a proposal to increase 

that to 20 years so that the payback would be longer. So that request has been made and has been suggested. 

Ms. NORTON. Well, staff tells me that that amendment is going 

to be included in our energy package as well to the full Committee. 

Mr. WINSTEAD. Okay, good. 

Ms. NORTON. Because the full Committee is—and, indeed, the 

majority wants the committees to submit doable proposals for energy conservation of various kinds. 

Mr. WINSTEAD. Madam Chair, I think the marketplace is a part 

of this. If you look back, there is a group called the Green Building 

Council that meets annually and brings the development community together with both public building owners, such as the GSA, 

with private, and about three years ago they were attracting—I 

spoke at it about six months ago—they were attracting about 4,000 

people to these conferences. The last one they had in Denver, there 

were 13,000 people there. So what you are now seeing is the private sector realizes that they can make money at this, so I think 

a lot of these new energy saving systems that are showing payback 

over two to three years—we do have better data I would be happy 

to provide to the Committee. 

Recently, at a presentation I heard from BOMA, they actually 

looked at, for all these energy systems like new chillers and glazing 

and various other, what the payout is in years, and I would be 

happy to provide that to the Committee, because it is much shorter 

than you would think. For most of the new technologies, the payback is between two and three years. Some people have been arguVerDate 0ct 09 2002 16:07 Apr 04, 2008 Jkt 000000 PO 00000 Frm 00025 Fmt 6633 Sfmt 6633 P:\DOCS\35924 HTRANS1 PsN: JASON
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ing this is going to take a decade or more to keep this competitive 

if we go this way. But I will provide that to the Committee. 

Ms. NORTON. You, of course, are a big rate payer in a region like 

this. Have you ever considered ways in which, again, given the importance of the Federal Government in regions like this—the Defense Department would be another one in various regions of the 

Country, but certainly the GSA—how you could affect building 

codes to reflect more energy efficient buildings, building codes in 

the regions where you are located? Is there any way for GSA to affect this project? 

Again, the Federal Government is such a big player. Nobody 

would try to regulate them. But here we are a big player. Are we 

using all of our considerable presence? 

Mr. WINSTEAD. I think we are, Madam Chair. I am sure there 

is more that we can do, but our P-100 reflects a lot of these new 

systems and requirements, and in terms of the District they have 

a new incentive, as you know, in terms of development in the District for LEEDs, so I think we are going to see that more in communities around the Country. 

Ms. NORTON. See, that really goes to my question. I see communities on their own. Did you have anything to do with the District’s 

LEED proposal? 

Mr. WINSTEAD. Well, I don’t know whether we actually reviewed 

the legislation——

Ms. NORTON. The reason I ask is to the extent we are in these 

areas——

Mr. WINSTEAD. Absolutely, we should be engaging. 

Ms. NORTON.—a major player, it would be a good thing to be involved in them locally. 

Mr. WINSTEAD. We will definitely follow up with you. 

Ms. NORTON. There will be no developer here bigger than the 

GSA, so if the GSA is at the table, you are likely to have an effect 

upon how building codes shape up. 

You have $15 million for energy programs in your fiscal year 

2008 budget. How is that to be used? 

Mr. WINSTEAD. That is for, Madam Chair, specific projects beyond what we are including in new construction. That is for basically looking at electronic monitoring devices and looking at specific, some solar applications. So these are special projects that are 

funded by that $15 million. 

Ms. NORTON. For buildings, for sites, for——

Mr. WINSTEAD. For specific projects in various buildings around 

the Country. But this is beyond what we are doing under the 

LEEDs. That is for specific projects for that $15 million. And we 

will be happy to break that out for you. 

Ms. NORTON. I would like to know about your progress on the St. 

Elizabeths campus. 

Mr. WINSTEAD. Sure. 

Ms. NORTON. This Committee has been very active with the appropriators and, unlike last session, we believe we have gotten the 

appropriators to some understanding of the importance of not letting the President’s allocation be disbursed elsewhere. It was a terrible thing to happen that we didn’t have the ability to get that 

19

through last time. So staff has done a very good job of keeping in 

very close touch with our appropriators. 

Would you tell me why the Homeland—oh, and I should mention 

that who is just as adamant about the new headquarters on the St. 

Elizabeths campus because of the management difficulties the 

Homeland Security agency has encountered is the chairman of that 

committee, who has also pressed very hard for this building to 

start. 

First, could you tell me why this appropriation was divided between two committees? Here we have GSA responsible for construction, no matter what type of construction it is, and yet some of the 

money was put into the Homeland Security budget. I realize it is 

the Homeland Security building. Has that generally been the case, 

if you are building a building specifically for an agency, it is divided between committees, the GSA committee and the committee 

which normally handles its appropriation? 

Mr. WINSTEAD. Chairman Norton, as you know, in our request 

for St. Elizabeths, which is considerable in the budget, there was 

additional appropriations on the DHS side to move that——

Ms. NORTON. Is it a technical reason why it was on the DHS 

side? As I understand it, that is for the wiring and the security upgrades and the rest, without which you couldn’t build a building 

anyway. Does anybody know why that occurred? That was a tremendous problem last time. 

Mr. WINSTEAD. I think that is typical in terms of what that was 

funding, versus what we have in for moving these elements of the 

Coast Guard Headquarters forward. 

Ms. NORTON. Well, apparently——

Mr. WINSTEAD. It is agency equipment, telecommunications. 

Ms. NORTON. Yes. Like furniture, I guess. 

Mr. WINSTEAD. Yes. 

Ms. NORTON. You fund the base building. It really was a terrible 

impediment——

Mr. WINSTEAD. To the issues last year. 

Ms. NORTON. Yes, it was. We believe it won’t be, but we are 

working double-time, and I would like to know what you have been 

doing, particularly in the Senate, to make sure that this appropriation goes through. I don’t believe the agency did all it could have 

done last time. 

Mr. WINSTEAD. Well, I remember last year, and continually, we 

have been in touch with you and your staff on this. Since March 

of 2006 we have had over 12 briefings on Capitol Hill with the appropriators on the House and Senate side to try to move this 

project forward, which I have heard directly, not in recent months, 

but from Michael Jackson, and I actually talked to Secretary 

Chertoff in January about this project, and he was very supportive 

of it. So I know that the issue is getting this money through Capitol Hill and us being diligent, along with this Committee, obviously, in ensuring the appropriation side gets done. 

Apparently we had, even recently, May 14th—I mean in four 

days, rather, we are going to have a briefing for the Senate on this 

same subject, so my sense is the agency has been very aggressive 

in trying to make sure that we are briefing the House and Senate 

appropriators on this, the importance of the project. Back in OctoVerDate 0ct 09 2002 16:07 Apr 04, 2008 Jkt 000000 PO 00000 Frm 00027 Fmt 6633 Sfmt 6633 P:\DOCS\35924 HTRANS1 PsN: JASON
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ber, as you know, Madam Chair, the housing plan that we were 

worried about a year ago that was not specific enough to convince 

certain of those. 

We think that is in place and we are, in fact, as you know, rapidly almost completing the Master Plan, of which I was briefed last 

Friday and would be happy to provide additional briefings to you 

and your staff on. So I think things are moving, and we will just 

work diligently, as we will with the Senate group in four days, to 

make sure this appropriation action gets done. 

Ms. NORTON. Well, I am very pleased to hear that you are briefing the Senate, because we have done our homework over here. 

Now, we believe we are in decent shape here. We are watching it 

every day to make sure that nothing slips off the side of the cliff, 

but we need your help and Homeland Security’s help on the Senate 

side as well, because obviously we are on pay-go this year, and this 

is the easiest money to pull out because it is for bricks and mortar. 

It also happens to be for an agency which is crippled, frankly, by 

having 60 different locations, 80 different leases, huge shuttle 

costs. When the authorization bill was passed for the Homeland Security bill yesterday, I didn’t go in to talk about ordinary homeland 

security measures on which I have been very deeply involved; I 

went to talk about what it means to have gone to all the trouble 

after 9/11 to put together this building, and then to have it exactly 

as it was, with people having to shuttle all over the place with duplicate facilities of every kind, from mail rooms to child care facilities. 

Mr. WINSTEAD. Madam Chair, one element of this that I just 

wanted to bring you up to speed on is the historic preservation elements here that we are working very hard on. I had a briefing last 

Friday on what our alternatives do in terms of preserving that historic element of St. Elizabeths. I would also mention that I have, 

as we have on the appropriations side, I have actually reached out 

personally to the chairman of the Advisory Council on Historic 

Preservation, a guy named John Nau, whose role, that Council’s 

role is to advice Federal agencies on the issue of historic buildings 

preservation. I have reached out to Dick Moe, who is with the National Preservation Trust. 

Both of those gentleman I have talked with about St. Elizabeths 

so that as we proceed on the Master Plan and begin to move on 

the issue of scale and density and restoration of certain buildings—

as you know, we have 60 buildings on that campus—that we have 

the historical preservation. 

Ms. NORTON. The historic preservation people are likely to be the 

last ones to come under the tent. What is your view of where they 

stand on these matters? 

Mr. WINSTEAD. Chairman Norton, I think our historic preservation people at GSA are working very closely with, as I mentioned, 

the Advisory Council on Historic Preservation. They actually asked 

a group of their board to work on St. Elizabeths in an advisory way 

with us. The chairman of that is this gentleman I mentioned 

named John Nau. I have shared, obviously, the efficiencies of consolidating DHS there, the positive economic development impact on 

the community in that area. He is a businessman very sensitive to 

that, but he is going to try to make sure that we adhere to the SecVerDate 0ct 09 2002 16:07 Apr 04, 2008 Jkt 000000 PO 00000 Frm 00028 Fmt 6633 Sfmt 6633 P:\DOCS\35924 HTRANS1 PsN: JASON
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tion 106 requirements, but he is obviously very much in support of 

the concept, generally. The densities are the issue, and we feel we 

have some alternatives that we are studying that will be acceptable, and we are going to continue on that stretch. 

Ms. NORTON. Well, we will get through it. We will get through 

it, but we can expect—and, of course, GSA is old hands at having 

to deal with various parts of the community, including the historic 

preservation. I am a strong historic preservationist. I live in a historic district in D.C. and in one of those houses that you can’t 

change, so I understand it very much. This is part of the city which 

no developer could ever develop because of the number of historic 

buildings. There are a number of them we are going to preserve. 

Some of them may not be as historic as people think, so we are 

going to have to do what is necessary. 

I finally want to ask you a set of questions about cost as a factor 

in leasing, and want to just put you on notice that the Subcommittee will be taking some actions to make sure that agencies 

do not have the authority they believe they have, but which the 

statute clearly does not give them, to pick and choose wherever 

they want to go, no matter the cost to the taxpayers. That was always wrong. It becomes really impossible now. The EEOC Chair, 

I think, recognized not only that her own budget had been cut very 

substantially over the years and that she had no choice, but that 

we were to a point where that simply wasn’t going to be allowed. 

So the Committee intends to take action. But I need to know 

what you are doing to make the cost of the lease itself a bigger factor in deciding where to locate agencies so that agencies have a realistic sense of where they can find sites that are indeed appropriate for them with the appropriate amenities, but recognizing 

that the day is over when they can decide as if they were private 

people with their own pocketbook. What have you done to make the 

cost of the lease a bigger factor in the location of Federal agencies 

and in making Federal agencies understand that you will consult 

with them, but that the statute does not make them the final arbiter of that matter when it comes to the expenditures involved? 

Mr. WINSTEAD. Madam Chair, I know that this has been a concern of yours for some time, and I know that there is history of certain moves over the last decade—I wasn’t party to them as Commissioner—where we actually made recommendations and there 

were other appeals higher up the chain and they ended up trying 

to get to some place other than where we have directed them based 

on real estate, our procurement guidelines, and low-cost considerations, which is what you are most concerned about. 

We continue to work hard looking at all the rules, the Section 

102 under the Federal Management Regulations, our GSA Customer Guide to our tenant agencies in terms of requiring delineated areas and making sure there is full competition and those 

aren’t constrained, including places like NoMa, as you know, we 

have done. The reality is we are going to continue to set and require the requirements and ensure that they adhere by our decision in terms of we are the landlord, we are the real estate experts; 

and that is what we try to do in all of our procurements, is to drive 

to both low-cost for the Government, as well as satisfactory location 

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and workplace solutions for our Federal tenants, and I will continue to do that. 

I know you had great concern over NoMa. You and I are on the 

same wavelength. I spent, in my prior career, a lot of time understanding the potential in areas like that in terms of both lease cost 

as well as transportation accessibility and amenities. I frankly 

think that our existing policies set a framework that allows us to 

achieve low-cost lease options, but also engages the agencies in 

terms of delineated areas and in terms of ultimate decisions in 

terms of location decisions. 

Ms. NORTON. We believe the agency needs help. The fact is that 

the evidence is before us that clearly agencies have been able to 

further delineate after there is a delineated area, and they do so, 

they say, because they want to be near ‘‘customers.’’ That, of 

course, is code for lawyers and code for being in the highest cost 

parts of the District of Columbia. That is what lawyers can afford. 

In a city the size of the District of Columbia, with an excellent 

transportation system, a taxi system, a livable walkable city, the 

notion that you have to be ‘‘close to your customers,’’ this is not 

Manhattan. This is a not a huge city. And, yet, there is no question 

that NoMa would not be empty except for I guess one agency, 

which now is having to fight its own employees to locate in NoMa 

because they don’t have the available information. 

In effect, what has happened is that GSA, for all of its expertise—and I am a big fan of this agency for its expertise, for the way 

it does much of its work, but the fact is that GSA has allowed 

agencies to redline parts of the District of Columbia. There is no 

question in my mind that that is what happened in NoMa. The 

people did so because they did not know that NoMa was the place, 

the up and coming place. They had not been sold on NoMa. So we 

do not intend to allow that to continue. That is why I want you to, 

on your end, get to the Committee what you intend to do in very 

specific terms to reach out to employees, and we believe the agency 

needs help. 

Very frankly, I will tell you that I think part of the problem is 

that EEOC is structural. EEOC is a peer agencies of these agencies, and it would take considerable strength and some, perhaps, 

ammunition besides perhaps what you have had to, in fact, make 

agencies understand that they are not free agents here. We have 

seen how the courts have just used the fact that they are courts 

to try to run roughshod all over GSA literally for every single year 

that I have been on this Committee, so I have some understanding. 

At least with agencies, they are peer agencies. The courts have 

tried to lord it over GSA as if they were somehow very special and 

had to be treated very specially. Well, the agency needs help, and 

under the new Congress we intend to give you that help. 

Mr. WINSTEAD. Chairman Norton, under both the FMR 102 Section 83, as well as Executive Order 12072, which deals with space 

assignment and efficiencies, I will look at those carefully and get 

back to you recommendations that we think you should consider 

that could tighten it and give us more. I don’t know, my lawyers 

will look at it and get back to you in terms of what we think are 

needed in those sections and others to strengthen both the result 

of low-cost leases as well as, obviously, locational decisions that are 

23

correct for the agency. I do know the history here, so I would be 

happy to look at these sections and others and get back to you. 

Ms. NORTON. Well, that is really the way to proceed. To the extent that the agencies can help us as we design new policies, that 

is the best way, for the agencies to come to the Subcommittee and 

say we need help, and this is the kind of help we could best use. 

We would be very much open to receiving that. The only bottom 

line is it is not going to continue the way it is, and the agencies 

really have developed this culture—that is all it can be called. It 

is an impression that they have, and they need to somehow have 

that abruptly turned around, other than being put in the position 

the EEOC is in, where she is out there fending for herself, trying 

to make people understand that she really doesn’t have any recourse. And guess what, she does not. She really does not have any 

recourse, and they believe that by being—they are treating this as 

a protest action. 

Nobody would ever make or require Federal employees to go 

where there weren’t all the amenities necessary. It is of course the 

case that the statute contemplates that Federal agencies will lead 

the way. Here we are not asking them to lead the way, and it is 

very interesting that big private entities are willing to lead the way 

based on cost and based on their analysis of the area and what is 

likely to happen, and in the Federal Government that has been 

harder to get across. 

I don’t want to continue to beat upon the agency for this. I recognize that this is not entirely your responsibility, it is the responsibility of this Committee. I would welcome, welcome your participation in this effort and any information or recommendations that 

you can give us, and I would caution you that you should do that 

before we have the hearing on the leases, because I intend to make 

this known at that time. 

Mr. WINSTEAD. We will get it right back to you. 

Ms. NORTON. Thank you very much. 

This hearing is adjourned. Thank you all for attending. 

[Whereupon, at 12:05 p.m., the subcommittee was adjourned.]

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