Federal Real Property: National Strategy and Better Data Needed to Improve Management of Excess and Underutilized Property
Published: 2012-06-20T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: The federal government has made some progress addressing previously identified issues with managing federal real property. This includes establishing FRPCchaired by the Office of Management and Budget (OMB)which created the FRPP database managed by GSA. GAO was asked to determine the extent to which (1) the FRPP database accurately describes the nature, use, and extent of excess and underutilized federal real property, and (2) progress is being made toward more effective management of these properties. GAO analyzed the data collection process and agency data, visited 26 sites containing excess and underutilized buildings from five civilian federal real property holding agencies with significant portfolios, and interviewed officials from these five agencies and OMB staff about how they collect FRPP data and manage excess and underutilized properties.
section_title: What GAO Found
paragraphs: The Federal Real Property Council (FRPC) has not followed sound data collection practices in designing and maintaining the Federal Real Property Profile (FRPP) database, raising concern that the database is not a useful tool for describing the nature, use, and extent of excess and underutilized federal real property. For example, FRPC has not ensured that key data elementsincluding buildings' utilization, condition, annual operating costs, mission dependency, and valueare defined and reported consistently and accurately. GAO identified inconsistencies and inaccuracies at 23 of the 26 locations visited related to these data elements (see the fig. for an example). As a result, FRPC cannot ensure that FRPP data are sufficiently reliable to support sound management and decision making about excess and underutilized property.
The federal government has undertaken efforts to achieve cost savings associated with better management of excess and underutilized properties. However, some of these efforts have been discontinued and potential savings for others are unclear. For example, in response to requirements set forth in a June 2010 presidential memorandum for agencies to achieve $3 billion in savings by the end of fiscal year 2012, the General Services Administration (GSA) reported approximately $118 million in lease cost savings resulting from four new construction projects. However, GSA has yet to occupy any of these buildings and the agencys cost savings analysis projected these savings would occur over a 30-year periodfar beyond the time frame of the memorandum. The five federal agencies that GAO reviewed have taken some actions to dispose of and better manage excess and underutilized property, including using these properties to meet space needs by consolidating offices and reducing employee work space to use space more efficiently. However, they still face long-standing challenges to managing these properties, including the high cost of property disposal, legal requirements prior to disposal, stakeholder resistance, and remote property locations. A comprehensive, long-term national strategy would support better management of excess and underutilized property by, among other things, defining the scope of the problem; clearly addressing achievement goals; addressing costs, resources, and investments needed; and clearly outlining roles and coordination mechanisms across agencies.
section_title: What GAO Recommends
paragraphs: GAO recommends that, in consultation with FRPC, GSA develop a plan to improve the FRPP and that OMB develop a national strategy for managing federal excess and underutilized real property. GSA agreed with GAOs recommendation and agreed with the reports findings, in part. OMB agreed that real property challenges remain but raised concerns about how GAO characterized its findings on FRPP accuracy and other statements. GAO believes its findings are properly presented. The details of agencies comments and GAOs response are addressed more fully within the report.

section_title: Letter
paragraphs: The federal government’s real property portfolio is vast and diverse and  includes almost 400,000 buildings that are located throughout the country  and are owned and leased by different federal agencies. We have noted  long-standing problems with how this property is managed, designating federal real property management as a high-risk area in January 2003.In 2004, the administration added managing federal real property to the  President’s Management Agenda and the President issued an executive  order establishing the Federal Real Property Council (FRPC). FRPC is  chaired by the Deputy Director for Management of the Office of  Management and Budget (OMB) and is composed of all agency Senior  Real Property Officers, the Controller of OMB, the Administrator of the  General Services Administration (GSA), and any other full-time or  permanent part-time federal officials or employees as deemed necessary  by the Council Chairman. The executive order required FRPC to work  with GSA to establish and maintain a single, comprehensive database  describing the nature, use, and extent of all real property under the  custody and control of executive branch agencies, except when otherwise  required for reasons of national security.Property Profile (FRPP) to meet this requirement.
FRPC created the Federal Real  These efforts notwithstanding, we have reported that the federal  government continues to face a number of challenges to effectively  managing its real property.  In particular, we have reported on challenges  to disposing of excess properties and making better use of properties that  are underutilized.
In response to your request that we assess issues related to excess and  underutilized federal real property, this report addresses two objectives:  1)  the extent to which the FRPP database consistently and accurately  describes the nature, use, and extent of excess and underutilized  federal real property and  2)  the extent to which progress is being made toward more effectively  managing excess and underutilized federal real property.
To address these objectives, we obtained and analyzed FRPP  submissions and other real property data from five civilian real property– holding agencies; interviewed real property officers at these agencies;  visited sites where the agencies had reported excess or underutilized  properties; interviewed OMB staff; and reviewed pertinent laws,  regulations, policies, and other documents related to the agencies’ real  property management. The five agencies we selected for review were  GSA, the Departments of Energy (DOE), the Interior (Interior), Veterans  Affairs (VA), and Agriculture (USDA).  On the basis of the available data,  these five agencies report approximately two-thirds of the building square  footage reported by civilian agencies. We obtained answers to a set of  questions about managing excess and underutilized properties that we  posed to the senior real property officers of these five agencies. For each  agency, we also obtained fiscal year 2008, 2009, and 2010 FRPP  submissions, as well as data from each agency’s internal systems that  were the source of their FRPP submissions. According to our  conversations with agency officials, FRPP submissions can be changed  only by the agency submitting the data. As a result, we believe that the  FRPP submissions obtained from the agencies match the data contained  in the FRPP database and are sufficiently reliable for the purpose of  evaluating the consistency and accuracy of the corresponding data in the  FRPP database. To gather detailed examples of excess and underutilized  properties and to learn about the processes by which data on such  properties are collected and submitted to the FRPP database, we visited  a nonprobability sample of approximately 180 buildings at 26 sites   where excess or underutilized owned buildings had been reported by the  five civilian agencies. We selected sites clustered around four U.S.  cities. In selecting sites, we considered the number of excess or  underutilized buildings reported at each site and the distance of each site  from the city. Across the 26 sites, we attempted to balance the numbers  of sites and buildings selected for the five agencies, and the numbers of  excess versus underutilized buildings selected. Prior to each visit, we  analyzed data for each building and developed a set of questions about  the data submission for local property managers. During site visits, we  interviewed local property managers, compared what we observed at  each building with the FRPP data for that building, and documented what  we observed.  Where possible, we took photographs of the buildings. In  addition to this work related to the FRPP, we interviewed OMB staff  because OMB chairs FRPC, oversees the implementation of the  executive order, and has set cost savings goals related to excess and  underutilized properties.
We conducted this performance audit from May 2011 to June 2012 in  accordance with generally accepted government auditing standards.  Those standards require that we plan and perform the audit to obtain  sufficient, appropriate evidence to provide a reasonable basis for our  findings and conclusions based on our audit objectives. We believe that  the evidence obtained provides a reasonable basis for our findings and  conclusions based on our audit objectives. Further details on our scope  and methodology can be found in appendix I.
subsections: section_title: Background
paragraphs: In 2010, federal agencies reported about 3.35 billion square feet of  building space to the FRPP: 79 percent of the reported building space  was federally owned, 17 percent was leased, and 4 percent was  otherwise managed. The data indicated that the agencies used most of  the space—about 64 percent—as offices, warehouses, housing,  hospitals, and laboratories. The five agencies we reviewed—GSA, DOE,  Interior, VA, and USDA—reported owning or leasing more than 866  million square feet of building space, or about 25 percent of the total  reported square footage for all agencies.
Initially, FRPC defined 23 FRPP data elements to describe the federal  government’s real property inventory. By 2008, FRPC had expanded the  number of data elements included in the FRPP to 25.  FRPC requires  agencies to update their FRPP real property data annually. Each asset  included in the database is assigned a unique identification number that  allows for tracking of the asset to the unique data that describe it.
See appendix II for a list of the 25 FRPP data elements as defined in 2010.
FRPP data elements as performance measures: utilization, condition  index, annual operating costs, and mission dependency. The definitions  of these four data elements in 2010 can be found in table 1.
FRPC’s 2010 Guidance for Real Property Inventory Reporting provides  specific guidelines on how to report a building as overutilized,  underutilized, utilized, or not utilized based on the building’s use and the  percentage of the building that is used (see table 2).
FRPC has been collecting FRPP data on federal government properties  since 2005. We have reported that results-oriented organizations follow a  number of sound data collection practices when gathering the information  necessary to achieve their goals. For example, these organizations  recognize that they must balance their ideal performance measurement  systems against real world considerations, such as the cost and effort  involved in gathering and analyzing data. These organizations also tie  performance measures to specific goals and demonstrate the degree to  which the desired results are achieved. Conversely, we have observed  that organizations that seek to manage an excessive number of  performance measures may risk creating a confusing excess of data that  will obscure rather than clarify performance issues. Limiting the number of  measures to the vital few not only keeps the focus of data collection  where it belongs, it helps ensure that the costs involved in collecting and  analyzing the data do not become prohibitive. Furthermore, results- oriented organizations report on the performance data they collect.
Following the implementation of the executive order and nationwide data  collection efforts, we have reported that agencies continue to face  challenges with managing excess and underutilized properties. For  example, we have previously reported that the legal requirements  agencies must adhere to, such as requirements for screening and  environmental cleanup as well as requirements related to historical  properties, present a challenge to consolidating federal properties. In  addition, before GSA can dispose of a property that an agency no longer  needs, it must offer the property to other federal agencies. If other federal  agencies do not need the property, GSA must then make the property  available to state and local governments as well as certain nonprofit  organizations and institutions for public benefit uses such as homeless  shelters, educational facilities, or fire and police training centers.  According to agency officials, as a result of this lengthy process, excess  or underutilized properties may remain in an agency’s possession for  years. Furthermore, the costs of disposing of property can further hamper  an agency’s efforts to address its excess and underutilized property  problems. For example, properties that contain radiological contamination  must be mitigated before they can be disposed. In addition, the interests  of multiple—and often competing—stakeholders may not align with the  most efficient use of government resources and complicate real property  decisions.
Despite these challenges, both the previous and current administrations  have implemented a number of cost savings initiatives associated with  excess and underutilized property. In August 2005, the administration set  a goal to reduce the size of the federal inventory by $15 billion by 2009.  In June 2010, the President directed federal civilian agencies to achieve  $3 billion in savings by the end of fiscal year 2012 through reducing  annual operating costs, generating income through disposing of assets,  using existing real property more effectively by consolidating existing  space, expanding telework, and other space realignment efforts.  Furthermore, on May 4, 2011, the administration proposed legislation— referred to as the Civilian Property Realignment Act (CPRA)—to establish  a legislative framework for disposing of and consolidating real property,  among other things. In September 2011, OMB projected that the  proposal would save the government $4.1 billion over 10 years from sales  proceeds, and that savings would also be achieved through decreased  operating costs and efficiencies. However, the Congressional Budget  Office (CBO) has concluded that CPRA would probably not result in a  significant increase in proceeds from the sale of federal properties over  the next 10 years.
section_title: Excess and Underutilized Property Data Are Inconsistent and Inaccurate because of Lack of Sound Data Collection Practices
paragraphs: FRPC has not followed sound data collection practices, and, as a result,  FRPP data do not describe excess and underutilized properties  consistently and accurately.  Consistent with this, FRPP data did not  always accurately describe the properties at the majority of sites we  visited and often overstated the condition and annual operating costs,  among other things.
subsections: section_title: FRPP Data Do Not Describe Excess and Underutilized Federal Real Properties Consistently and Accurately
paragraphs: Agency officials described ways in which key performance measures in  the FRPP database are reported inconsistently or inaccurately. At 23 of  the 26 sites that we visited, we found inconsistencies or inaccuracies  related to the following performance measures described in the  background: (1) utilization, (2) condition index, (3) annual operating costs,  and (4) mission dependency. As a result of the discussions we had with  agency officials about how FRPP data are reported, as well as the  inconsistencies and inaccuracies described in the following sections, we  question whether FRPP data provide an adequate tool for decision  making or measuring performance, such as the cost savings initiatives  put forth by OMB.
We found that the agencies we reviewed do not report property utilization  consistently. FRPC guidance states that for offices, hospitals, and  warehouses, utilization is the ratio of occupancy to current design  capacity.  Although USDA requires its agencies to follow FRPC  guidance, USDA stated that FRPC has not established governmentwide  definitions for occupancy or current design capacity.  As a result, each  agency within USDA has its own internal procedures for determining a  building’s utilization level.  Moreover, VA defines utilization differently  from FRPC guidance, that is, the ratio of “ideal space” to existing space,  which VA stated is different from occupancy.  Despite the inconsistency of  this method of defining utilization with FRPC guidance, VA officials reported that OMB staff approved of their method of reporting utilization.Furthermore, OMB acknowledged that it is standard practice for agencies  to measure utilization tailored to the agencies’ specific needs and  circumstances.
Among the 26 federal sites we visited, we found utilization data  inconsistencies or inaccuracies for properties at 19 of these sites. For  example, at one VA site, a building we toured was reported to have a  utilization of 39 percent in 2010 FRPP data and 45 percent utilization in  2011 source data, even though local officials said this building has been  fully occupied since 2008. See figure 1.  Another building that we toured  at the same site was reported to be 0 percent utilized in 2010 FRPP  data and 59 percent utilized in 2011 agency source data.
However, all  but one of the rooms in the building were vacant, and local officials said  only 10 percent of the building was utilized.
In addition, at one USDA site we visited, we found two houses that have  been empty since 2009; however, they were both reported to the FRPP  as utilized for 2009 and 2010. See figure 2 to view images of these two  USDA buildings. We also found problems with the utilization data at  properties owned by the other three agencies included in our review.
As was the case with utilization, we found that agencies do not report the  condition of their properties consistently. According to FRPC guidance,  condition index is a general measure of the constructed asset’s condition  and is calculated by using the ratio of repair needs to the plant  replacement value (PRV). Needed repairs are determined by the  amount of repairs necessary to ensure that a constructed asset is  restored to a condition substantially equivalent to the originally intended  and designed capacity, efficiency, or capability. However, we found that  agencies do not always follow this guidance. For example, when  agencies have determined that a property is not needed and will  ultimately be disposed, they may assign no repair needs to that property  even though the property may be in a state of significant disrepair. Doing  so allows agencies to use their limited funds to maintain properties that  they regularly use, but it can lead to condition index data that do not  accurately reflect each property’s condition as set forth in FRPC  guidance. Figure 3 is an example of how the condition index of a building  with high repair needs can significantly change depending on whether  agency officials choose to follow FRPC guidance or if they assign zero  dollars in repair needs because repairs are not planned.
While it may be a good practice not to assign repair needs to dilapidated  buildings that no longer support agencies in carrying out their mission, the  fact that these buildings may report a perfect or near-perfect condition  index provide decision makers with an inconsistent representation of the  condition of buildings at a given site. We found examples at all five  agencies we visited where a property in very poor condition received a  higher condition index score than a property in good condition. Figure 4  demonstrates examples of this at an Interior site we visited.
We found condition index reporting inconsistencies and inaccuracies at  21 of 26 sites visited. The practice of assigning no repair needs to many  excess and underutilized buildings because agencies have no intention of  repairing them led to severely blighted buildings receiving excellent  condition scores.received high condition index scores, even though they are in poor  condition. Some of the problems with these buildings include asbestos,  mold, collapsed walls or roofs, health concerns, radioactivity,  deterioration, and flooding.
section_title: Although Some Progress Has Been Made, Federal Property Management Is Still Challenging and Efforts Lack a National Strategy
paragraphs: The federal government has taken some steps to address excess and  underutilized property management problems by developing the FRPP  database, among other things. However, cost savings efforts associated  with excess and underutilized property over the years were discontinued  and recent efforts may overstate potential savings. Although the federal  agencies we reviewed have taken some actions to try to address excess  and underutilized properties, long-standing challenges remain. As a  result, a national strategy could help the federal government prioritize  future management efforts.
subsections: section_title: Limited Progress Has Been Made in Managing Excess and Underutilized Federal Property, but the Extent of Cost Savings Is Not Clear
paragraphs: The federal government has made some progress in managing real  property since we first added this issue to our high-risk series. In a 2007  review of federal real property, we found that the administration at that  time made progress toward managing federal real property and  addressing some long-standing problems. The 2004 executive order  established FRPC to develop property management guidance and act as  a clearinghouse for property management best practices. FRPC created  the FRPP database and began data collection in December 2005. As part  of a 2011 update to our high-risk series, we reported that the federal  government has also taken steps to improve real property management,  most notably by implementing some GSA data controls and requiring  agencies to develop data validation plans.management as high risk, reliable tools for tracking property were  generally unavailable. Consequently, we determined that the  development of a database and the implementation of additional data  quality controls were steps in the right direction. However, on the basis of  our current work, it appears that data controls have not brought about  widespread improvements with data consistency and accuracy as was  anticipated. Nonetheless, we found that the FRPP can be used in a  general sense to track assets. For example, during our site visits, agency  officials were able to match assets with the real property unique   Prior to designating property  identification numbers assigned to them in the FRPP database and were  able to locate even small, remote buildings using these numbers.
In addition to establishing FRPC, developing the FRPP, and  implementing the executive order, the previous and current  administrations have sought ways to generate cost savings associated  with improving management of excess and underutilized properties.  However, these efforts have not led to proven cost savings associated  with the management of these properties.
Cost savings goals set by the previous administration were  discontinued. In 2007, we reported that adding real property  management to the President’s Management Agenda in 2004 increased  its visibility as a key management challenge and focused greater attention  on real property issues across the government. As part of this agenda,  the previous administration set a goal of reducing the size of the federal  real property inventory by 5 percent, or $15 billion, by the year 2015.  OMB staff at the time reported that there was an interim goal to achieve  $9 billion of the reductions by 2009. OMB staff recently told us that the  current administration is no longer pursuing these goals. Furthermore, the  senior real property officers of the five agencies we reviewed told us that  they were never given specific disposal targets to reach as part of these  prior disposal goals.
Cost savings associated with improved management of excess and  underutilized properties as directed in the June 2010 presidential  memorandum are unclear. OMB staff also said that while the goals of  the previous administration are no longer being pursued, the current  administration issued a memorandum that directed civilian agencies to  achieve $3 billion in savings by fiscal year 2012 through better  management of excess properties, among other things. According to the  administration’s website, as of September 2011, approximately half of the  cost savings had been achieved ($1.48 billion). Almost half of the total  goal (about $1.4 billion) is targeted to the five agencies we reviewed.  Officials from these agencies reported various cost savings measures  such as selling real property, forgoing operations and maintenance costs  from disposed properties, and reducing energy costs through  sustainability efforts to achieve agency savings targets. As of the first  quarter of fiscal year 2012, only two of the agencies we reviewed—GSA  and USDA—were claiming any sales proceeds from the sale of federal  real property: GSA reported $41.1 million in savings from sales proceeds  and USDA reported approximately $5.6 million. Interior officials stated  that individual sales with positive net proceeds are offset by those sales in  which the cost of the disposal (i.e., as a result of environmental  remediation and repair) is greater than any proceeds realized.  Furthermore, DOE officials reported that the disposition costs of the  properties they sold during the time frame of the memorandum were  actually greater than the proceeds. As a result, DOE has reported a net  loss of $128 million on property sales for this time period. VA also did not  include asset sales as part of its savings plan.
Four of the five agencies told us that they believe they will reach their  savings targets by the end of fiscal year 2012; however, whether they  claim to reach those goals or not, the actual and estimated savings  associated with excess and underutilized property management may be  overstated. Furthermore, agencies were not required to develop cost  savings that reflected a reduction in agency budgets. We found problems  with cost savings estimates related to excess and underutilized property  management from all five of the federal agencies we reviewed   (see table 4).
OMB staff has not provided information to support projected cost  savings if CPRA is enacted. In addition to the expected savings  resulting from the June 2010 presidential memorandum, OMB staff  reported that CPRA—the legislation the administration has proposed to  address real property management obstacles—will result in $4.1 billion in  savings within 10 years following enactment from sales proceeds as well  as unspecified savings from operating costs and efficiencies. However,  the CPRA projections may not reflect true cost savings. OMB staff did not  provide a methodology, calculations, or any other basis for its stated  projections. Furthermore, CBO concluded that CPRA would probably not  result in a significant increase in proceeds from the sale of federal  properties over the next 10 years. CBO noted that the Department of  Defense holds about one-third of the excess properties. CPRA would  have no effect on these properties, because the proposal only applies to  civilian agencies. Furthermore, CBO estimated that implementing CPRA  would cost $420 million over the 2012 through 2016 period to prepare  properties for sale or transfer. The President’s fiscal year 2013 budget  requested $17 million to implement CPRA (if it is enacted) and $40 million  to establish an Asset Proceeds and Space Management Fund to facilitate  the disposal process intended to reimburse agencies for some necessary  costs associated with disposing of property. This amount is far short of  the $420 million that CBO projected would be needed to prepare  properties for sale or transfer within a 4-year period.
section_title: Federal Agencies Have Made Progress but Still Face Long-standing Challenges
paragraphs: Despite problems with data collection and national cost savings goals, we  found that agencies have taken steps to address excess and  underutilized properties in their portfolios. For example, all five agencies  we reviewed have taken steps to use property more efficiently, as follows:  Identifying underutilized assets to meet space needs. VA officials told  us that they implemented a process to identify vacant and  underutilized assets that they could use to meet space needs. In  addition, VA officials stated that the department is planning to reuse  currently utilized assets that will be available in the future. VA officials  added that they have identified 36 sites that include 208 buildings and  more than 600 acres that they can use to provide more than 4,100  units of homeless and other veteran housing.
Consolidating offices among and within agencies. USDA and Interior  signed a memorandum of understanding in November 2006 that  allows the agencies to colocate certain operations and use their  buildings more efficiently. The memorandum of understanding  enables the agencies to share equipment and space. In addition,  USDA closed laboratories at four locations and consolidated  operations with existing USDA sites. In its National Capital Region,  USDA has consolidated five separate leased locations, totaling  363,482 square feet, into one location at Patriot’s Plaza in  Washington, D.C. USDA reported that the consolidation into Patriot’s  Plaza will result in annual rent savings of about $5.6 million. DOE  officials also stated that the department encourages offices to  consolidate operations when it is cost effective to do so. The  department also increased the use of an office building at the  Lawrence Livermore National Laboratory from 22 percent to 100  percent by changing its use from office space to a building that  houses computers. Furthermore, VA consolidated its medical center  campuses in Cleveland, Ohio, and engaged a number of private  partners directly to reuse the unneeded sites, using its Enhanced Use  Lease authority.
Reducing employee work space. To use space more efficiently,  Interior reduced new space utilization per employee from 200 usable  square feet per person to 180 usable square feet per person. This  action decreased total new space by 10 percent in all areas including  employee work space and conference space.
Using operations and maintenance charges to reduce operating costs  and encourage efficient use of space. DOE officials reported that  several sites servicing multiple programs or performing work for  others have developed a space charge system whereby a site  charges tenants for the operations and maintenance of the square  footage they occupy on a square foot basis. This charge defrays  operations and maintenance costs associated with the site and  encourages tenants to minimize their own space use.
Transferring unneeded property to other entities. Interior officials have  disposed of excess properties by transferring them to other  organizations to use. For example, Interior officials reported that the  department donated a freezer building and a laboratory building at the  Woods Hole Science Center in Falmouth, Massachusetts to the  Woods Hole Oceanographic Institution. The department also  transferred buildings and land at a Corbin, Virginia site to the National  Oceanic and Atmospheric Administration.
Creating alternate uses for unused assets. GSA found an alternate  use for 400,000 square feet of a concrete slab that remained after  demolishing an excess building. When needed, GSA leases the slab  to the Federal Emergency Management Agency as outdoor storage  space for electric generators and other heavy equipment and as a  staging area for equipment during responses to disasters (see fig. 10).
Using telework and hoteling work arrangements.we reviewed require or allow employees to use alternate work  arrangements such as teleworking or hoteling, when feasible, to more  efficiently use space. For example, GSA instituted a pilot hoteling  project at the Public Building Service headquarters in Washington,  D.C., to reduce needed space.
Progress notwithstanding, agencies still face many of the same long- standing challenges we have described since we first designated real  property management as a high-risk area.
Agency disposal costs can outweigh the financial benefits of  property disposal. USDA officials reported that the costs of disposing of  real property can outweigh savings that result from building demolition  and that limited budgetary resources create a disincentive to property  disposal. USDA determined that the total annual cost of maintaining  1,864 assets with annual operating costs less than $5,000 was $3 million.  Conversely, USDA concluded that the disposal costs for these assets  equals or exceeds their annual operating cost of $3 million. Thus,  disposal of the assets would not result in immediate cost savings, and  USDA has not demolished the assets. In addition, Interior officials  reported that numerous National Park Service buildings acquired during  the planning for a Delaware River dam that was never built are excess, as  are many cabins and houses along the Appalachian Trail. Because  Interior is not spending any operations and maintenance on these assets,  disposing of them would not provide savings to the department. As a  result, Interior has made a business decision to only fund a small  percentage of these disposals at the Delaware River dam site.
Legal requirements—such as those related to preserving historical  properties and the environment—can make the property disposal  process lengthy according to agency officials. Meeting requirements  associated with historical properties can delay or prevent disposal of  excess buildings. The National Historic Preservation Act, as amended,  requires agencies to manage historic properties under their control and  jurisdiction and to consider the effects of their actions on historic  preservation.dispose of a 15,200-square-foot building at Menlo Park, California that  has been used as both a residence and a research building during its 83- year history. The building has been scheduled for demolition since 2001,  but VA cannot demolish it because of a historical designation. In addition,  in 2010, Interior canceled the disposal of a 95-square-foot stone property  that we visited because it was found eligible for historic designation. The  property is in poor condition and has not been used for many years, but  Interior officials told us that they are now planning to stabilize and restore  the structure (see fig. 11).
section_title: Conclusions
paragraphs: The federal government has made some progress in managing real  property since it was first added to our high-risk series. The FRPC  created the FRPP database to track federal property and the federal  agencies we reviewed have taken some actions to address excess and  underutilized property. Even with long-standing efforts to improve the  management of excess and underutilized properties and save costs,  federal agencies continue to face many of the same challenges that we  have reported for over a decade. The problems still facing the federal  government in this area highlight the need for a long-term,  comprehensive national strategy to bring continuity to efforts to improve  how the federal government manages its excess and underutilized real  property and improve accountability for these efforts. Such a strategy  could lay the framework for addressing the issue of inconsistent and  inaccurate data on excess and underutilized federal properties. We  continue to believe that consistent and accurate data on federal real  property are necessary for the federal government to effectively manage  real property. While the 2004 executive order charged the Administrator  of GSA, in consultation with FRPC, to develop the data reporting  standards for the FRPP database, the current standards have allowed  agencies to submit data that are inconsistent and therefore not useful as  a measure for comparing performance inside and outside the federal  government. Also, the current definitions of certain data elements could  perpetuate confusion on the nature of federal government properties. For  example, the FRPP data element, PRV, is commonly referred to as an  asset’s “value,” which can cause decision makers to make assumptions  about the worth of the asset even though the PRV cannot be accurately  used in this way. Moreover, many agencies do not have the resources to  collect data at the asset level, and the information that is reported in order  to meet requirements for asset-level data is likely conveying an  inaccurate picture of excess and underutilized property. Furthermore,  federal government agencies have vastly different uses for properties,  and it may be challenging to collect certain kinds of property management  data using a single database. This makes it difficult for decision makers to  understand the scope of the problem and assess potential cost savings  and revenue generation. Now that FRPC has had several years of  experience with these data, it is in a better position to refine data  collection requirements by identifying data that are suitable for  comparison in a nationwide database. Following sound data collection  practices could help FRPC to thoroughly evaluate and retool the FRPP so  that it collects and provides data that are consistent and accurate to  decision makers, even if this means collecting less data in the short term.  GSA is uniquely positioned to lead this effort because of its charge to  develop FRPP data reporting standards.
section_title: Recommendations for Executive Action
paragraphs: We are making two recommendations, one to the Director of OMB and  one to the Administrator of GSA.
We recommend that the Director of OMB require the OMB Deputy  Director for Management, as chair of FRPC, in collaboration and  consultation with FRPC member agencies, to develop and publish a  national strategy for managing federal excess and underutilized real  property that includes, but is not limited to, the following characteristics: a statement of purpose, scope, and methodology; problem definition and risk assessment; goals, subordinate objectives, activities, and performance measures,  including the milestones and time frames for achieving objectives;  resources, investments, and risk management; organizational roles, responsibilities, and coordination; and  integration and implementation plans.
We recommend that the Administrator of GSA, in collaboration and  consultation with FRPC member agencies, develop and implement a plan  to improve the FRPP, consistent with sound data collection practices, so  that the data collected are sufficiently complete, accurate, and consistent.  This plan should include, but not be limited to the following areas: ensuring that all data collection requirements are clearly defined and  that data reported to the database are consistent from agency to  agency; designating performance measures that are linked to clear  performance goals and that are consistent with the requirements in  the 2004 executive order (or seeking changes to the requirements in  this order as necessary);  collaborating effectively with the federal agencies that provide the  data when determining data collection requirements and limiting the  number of measures collected to those deemed essential, taking into  account the cost and effort involved in collecting the data when  determining data collection requirements; and developing reports on the data that are collected.
section_title: Agency Comments and our Evaluation
paragraphs: We provided a draft of this report to OMB, GSA, VA, USDA, DOE, and  Interior for review and comment. OMB did not directly state whether it  agreed or disagreed with our recommendations. OMB agreed that  challenges remain in the management of the federal government's excess  and underutilized properties; however, OMB raised concerns with some  of the phrasing in our report and offered further context and clarification  regarding the administration’s overall efforts on real property reform.   OMB’s comments are contained in appendix III, along with our response.   GSA agreed with our recommendation to improve the FRPP and  described actions its officials are taking to implement it.  GSA also  partially agreed with our findings and offered some clarifications.  GSA’s  comments are contained in appendix IV along with our response.  VA  generally agreed with the overall message of our report, but disagreed  with how we presented certain issues.  VA’s comments are contained in  appendix V along with our response. USDA provided clarifying comments  which we incorporated, where appropriate.  USDA’s comments are  contained in appendix VI.  DOE provided technical clarifications, which  we incorporated where appropriate, but did not include as an appendix.   Interior did not provide comments.
OMB stated that, because our conclusion regarding the accuracy of  FRPP data is based on our sample of 26 site visits, further study is  needed to determine whether the problems we found are systemic.   However, as discussed in the report, our findings are primarily based on  the issues we identified with FRPC’s data collection practices, which are  the basis of the entire FRPP data collection process and are thus  systemic.  The 26 sites that we visited complement those findings and  illustrate how poor data collection practices affect data submissions;  however, they are not the only basis for our findings.  Furthermore, OMB  stated that the administration has a strategy for improving the  management of federal real property that serves as an important  foundation for the national strategy we recommend in this report. While  the initiatives OMB described may represent individual, positive steps, we  do not believe that they fully reflect the key characteristics of a cohesive  national strategy.  A national strategy would improve the likelihood that  current initiatives to improve real property management will be sustained  across future administrations.  A more detailed discussion of our views on  OMB’s comments can be found in appendix III.
GSA stated that our report correctly identifies many of the problems that  hampered effective FRPP data collection in 2011.  According to GSA, it  has taken specific actions to begin addressing our recommendation,  including modifying FRPC guidance to the agencies to clarify report  definitions and proposing reforms of the collection process to FRPC  consistent with our recommendation.  GSA also offered a few  clarifications on our findings.  GSA stated that it was unclear whether the  examples of inconsistencies we discuss in our report are systemic.  As  noted, our findings are primarily based on the problems we found with the  overall data collection process.  Thus, our recommendation to GSA  involves adopting sound data collection practices.  In addition, GSA  stated that, because FRPP data is reported annually, property utilization  and condition may change from the time that information is submitted.   However, we took steps, including discussing the history of each property  with local property managers, to ensure that any inconsistencies we  found were not due to changes between the time data was reported and  the time we visited the building.  These steps and a more detailed  discussion of our views on GSA’s comments can be found in appendix IV.
VA generally agreed with our findings and provided additional information  on VA’s federal real property portfolio, their methods of reporting real  property data, and efforts the department is taking to address its excess  and underutilized properties.  However, VA disagreed with some of our  statements related, for example, to property utilization. A more detailed  discussion of our views on VA’s comments can be found in appendix V.   In addition, USDA provided comments and clarifications which we  incorporated, where appropriate.  For example, USDA clarified its  previous statement regarding utilization reporting to emphasize that  component agencies are directed to follow FRPC guidance, but  acknowledged that this guidance was inconsistent.  USDA also clarified a  previous statement regarding problems faced by the agency when  reporting FRPP data in 2011.  USDA’s comments can be found in  appendix VI.
We are sending copies of this report to the Director of OMB; the  Administrator of GSA; and the Secretaries of Energy, Interior, Veterans  Affairs, and Agriculture. Additional copies will be sent to interested  congressional committees. We will also make copies available to others  upon request, and the report is available at no charge on the GAO  website at http://www.gao.gov.
If you have any questions about this report, please contact me at   (202) 512-5731 or wised@gao.gov. Contact points for our Offices of  Congressional Relations and Public Affairs may be found on the last page  of this report. Major contributors to this report are listed in appendix VII.
section_title: Appendix I: Objectives, Scope, and Methodology
paragraphs: Our objectives were to determine to what extent (1) the Federal Real  Property Profile (FRPP) database consistently and accurately describes  the nature, use, and extent of excess and underutilized federal real  property, and (2) progress is being made toward more effectively  managing excess and underutilized federal real property. We identified  five civilian real property-holding agencies for our review: the General  Services Administration (GSA); the Departments of Energy (DOE), the  Interior (Interior), and Veterans Affairs (VA); and the U.S. Department of  Agriculture (USDA). We chose GSA, DOE, Interior, and VA because  these were the four largest agencies in terms of total building square  footage of all civilian real property agencies that are required to submit  data under the executive order. On the basis of the data available, these  five agencies report approximately two-thirds of the building square  footage reported by civilian agencies. We did not consider agencies in the  Department of Defense because we previously reported on the  department’s excess facilities. We added USDA to our list of selected  agencies because USDA reported more excess properties than any other  civilian agency in 2009.
To determine to what extent the FRPP database described the nature,  use, and extent of excess and underutilized federal real property, we  obtained and analyzed FRPP data submissions and other real property  data from the five selected agencies; interviewed real property officers at  these agencies; visited sites where the agencies had reported excess or  underutilized properties; interviewed Office of Management and Budget  (OMB) staff; and reviewed FRPC guidance and other documents related  to the agencies’ real property data and the FRPP database. We obtained  the agencies’ FRPP data submissions for fiscal years 2008 through 2010.   According to our conversations with agency officials, FRPP submissions  can only be changed by the agency submitting the data. As a result, we  believe that the FRPP submissions obtained from the agencies match the  data contained in the FRPP database and are sufficiently reliable for the  purpose of evaluating the consistency and accuracy of the FRPP  database. In addition, for select data elements, we obtained real property  data from the source databases that each agency uses to generate its  annual FRPP submissions. We obtained source system data to get the  actual percentage of utilization of each property as of the date when  these data were extracted and provided to us in September or October of  2011. For the years of our FRPP data review (fiscal years 2008 through  2010), agencies were only required to report utilization using four  categories: overutilized, utilized, underutilized, or not utilized. However,  the FRPP guidance stated that agencies should maintain the actual  percentage of utilization in their own systems for audit purposes.
We posed questions to senior real property officers at the five agencies  about the collecting and reporting of real property data. To gather detailed  examples of excess and underutilized properties and to learn about the  processes by which data on such properties are collected and submitted  to the FRPP database, we visited sites where the five agencies had  reported excess or underutilized properties. We selected these sites  using information from the agencies’ FRPP submissions.  To narrow our  scope, we chose only federally owned buildings for our visits. Using the  most recent FRPP submissions we had at the time (fiscal year 2010), we  selected a nonprobability sample of owned buildings for each agency that  were listed as excess (on the status indicator data element) or  underutilized (on the utilization data element), or both. Because VA did  not classify any of their owned buildings as “excess,” we also selected VA  buildings classified as “not utilized.”sample, observations made at these site visits do not support  generalizations about other properties described in the FRPP database or   Because this is a nonprobability  about the characteristics or limitations of other agencies’ real property  data. Rather, the observations made during the site visits provided  specific, detailed examples of issues that were described in general terms  by agency officials regarding the way FRPP data is collected and  reported. We focused on sites clustered around four cities: Washington,  D.C.; Dallas, Texas; Los Angeles, California; and Oak Ridge, Tennessee.  This strategy afforded both geographic diversity and balance among our  selected agencies while also accommodating time and resource  constraints. In selecting sites and buildings in and around these four  cities, we took into account the following factors:
We prioritized sites that had multiple excess and/or underutilized  properties. This allowed us to see more properties in a limited amount  of time.
We prioritized the selection of excess and/or underutilized properties  that fell into one of the five types of real property uses required to  submit utilization data in 2010—offices, warehouses, hospitals,  laboratories, and housing. However, we also selected some buildings  classified as “other,” particularly buildings that were large or that had  high reported values.
We attempted to balance the numbers of excess and underutilized  buildings we selected. (Some buildings were classified as both excess  and underutilized since these classifications are made in different data  elements in FRPP.)
We attempted to visit four or five sites from each of the five different   However, most GSA sites consisted of only one building,  agencies.so we selected more sites for GSA. In the end, we selected four sites  from each of Interior and USDA, five from each of DOE and VA, and  eight from GSA. In all, we selected 26 sites.
Whereas we selected sites based in large part on the numbers and kinds  of buildings they had, the exact set of buildings we visited at each site  depended on additional factors. At some sites, there were too many  excess and underutilized properties to see them all. In those  circumstances, we prioritized large buildings with high reported values  and tried to see a number of different kinds of buildings (e.g., a mix of  offices and warehouses). At several sites, local property officials identified  other properties with issues related to excess and underutilized property  that we toured and analyzed.
Prior to each site visit, we analyzed the FRPP data submissions for fiscal  years 2008 through 2010 and agencies’ source system data we obtained  in September or October 2011, and developed questions about the data  submissions for local property managers. During our site visits, we  interviewed local property managers and compared what we observed at  each building with the FRPP data for that building. When not restricted by  security concerns, we photographed the building. In addition to questions  about individual properties, we questioned the local officials about the  kind of data they collect on the properties and how they collect it.
To summarize inconsistencies and inaccuracies between our  observations at the properties we visited and the FRPP data for those  properties, we analyzed 2008 through 2010 FRPP data for all of the  properties. As part of this review, we checked the reported utilization,  condition index, value, and annual operating costs for each building for all  three years. Four analysts, working together, evaluated these data both  for inaccuracies (cases where the data clearly misrepresented the actual  utilization, condition, value, or annual operating costs of a property) and  for year-to-year inconsistencies (cases where reported values showed  large year-to-year changes that did not correspond to observable  changes in the property and that agency officials could not explain). Each  of the 26 sites was counted as having a problem on a given data element  if at least one inconsistency or inaccuracy was identified for that element.The four analysts discussed each case and arrived at a consensus as to  whether a problem existed in each data element for each site.
To determine the progress being made toward more effective  management of federal excess and underutilized real property, we asked  the senior real property officers at each of our selected agencies to  provide written responses to a standard list of questions. These questions  addressed management issues related to excess and underutilized  owned buildings, how FRPP data are reported, and progress the agency  is making toward sales and utilization goals set by the OMB. We analyzed  the written responses to our questions and reviewed supporting  documentation provided by agency officials such as regulations, policies,  and other documents. In addition to reviewing the written responses to  our questions, we reviewed a number of our previous reports and  pertinent reports by the Federal Real Property Council (FRPC), the  Congressional Budget Office, and the Congressional Research Service.  We also reviewed and analyzed federal laws relating to real property for  the major real property-holding agencies.
Because OMB chairs FRPC and has set cost savings goals related to  federal real excess and underutilized properties, we analyzed documents  related to these goals—including the 2004 executive order, the June 2010  presidential memorandum on “Disposing of Unneeded Federal Real  Estate,” and legislation proposed by the administration known as the  Civilian Property Realignment Act (CPRA). We also interviewed  knowledgeable OMB staff about agency-specific targets related to the  June 2010 presidential memorandum, the methodology used to project  potential cost savings if CPRA were to be enacted, and progress toward  costs savings goals set by the previous administration.
We conducted this performance audit from May 2011 to June 2012 in  accordance with generally accepted government auditing standards.  Those standards require that we plan and perform the audit to obtain  sufficient, appropriate evidence to provide a reasonable basis for our  findings and conclusions based on our audit objectives. We believe that  the evidence obtained provides a reasonable basis for our findings and  conclusions based on our audit objectives.
section_title: Appendix II: Federal Real Property Council Fiscal Year 2010 Inventory Data Elements and Descriptions
subsections: section_title: Data element number Data element name 1 2 3
paragraphs: Data element definition  Real property type indicates the asset as land, building, or structure.  Real property use indicates the asset’s predominant use as land, building, or structure.  The legal interest indicator is used to identify a real property asset as being owned by the  federal government, leased to the federal government (i.e., as lessee), or otherwise managed  by the federal government. Otherwise managed properties are (1) owned by a state or  foreign government that has granted rights for use to the federal government using an  arrangement other than a lease, or (2) trust entities that hold titles to assets predominantly  used as museums, yet may receive some federal funds to cover certain operational and  maintenance costs.  Status reflects the predominant physical and operational status of the asset. Buildings,  structures, and land assets have one of the following attributes:  Active. Currently assigned a mission by the reporting agency.  Inactive. Not currently being used but may have a future need. Includes real property in  a caretaker status (closed pending disposal; for example, facilities that are pending a  Base Realignment and Closure action) and closed installations with no assigned current  federal mission or function.  Excess. Formally identified as having no further program use of the property by the  landholding agency.
Disposed. Required for assets that have exited the federal portfolio of assets during the  current reporting period.
Each asset owned or leased by the federal government (and those otherwise managed by  museum trusts) has one of the following historical status attributes:
National Historic Landmark
National Register listed
National Register eligible
Noncontributing element of a National Historic Landmark or National Register listed  district  Evaluated, not historic  Reporting agency refers to the federal government agency reporting the property to the  FRPC inventory database.   Using organization refers to the predominant federal government agency or other nonfederal  government entity occupying the property.   Size refers to the size of the real property asset according to appropriate units of measure.  The unit of measure used for the three real property types is as follows:  For land, the unit of measure is acreage and is designated as either rural acres or urban  acres.  For buildings, the unit of measure is area in square feet and is designated as gross  square feet.  For structures, the unit of measure includes the size (or quantity) and unit of measure,  and can include square yards, linear feet, miles, and the numbers of specific types of  structures.
section_title: Data element number Data element name 9 Utilization
paragraphs: Data element definition  Utilization is defined as the state of having been made use of, that is, the rate of utilization.  The utilization rate for each of the five building predominant use categories is defined as  follows:  office: ratio of occupancy to current design capacity,  hospital: ratio of occupancy to current design capacity, warehouse: ratio of gross square feet occupied to current design capacity,  laboratory: ratio of active units to current design capacity, and  housing: percent of individual units that are occupied.
Value is defined as the cost of replacing the existing constructed asset at today’s standards  and is also known as plant replacement value (PRV) or functional replacement value.  Condition index is a general measure of the constructed asset’s condition at a specific point  in time. The condition index is calculated as the ratio of repair needs to PRV. Repair needs  are the amount necessary to ensure that a constructed asset is restored to a condition  substantially equivalent to the originally intended and designed capacity, efficiency, or  capability. Agencies will initially determine repair needs based on existing processes, with a  future goal to further refine and standardize the definition. The condition index will be  reported as a “percent condition” on a scale of zero to 100 percent.   Mission dependency is the value an asset brings to the performance of the mission as  determined by the governing agency: mission critical: without constructed asset or parcel of land, mission is compromised; mission dependent, not critical: does not fit into mission critical or not mission dependent  categories; and  not mission dependent: mission unaffected.
Annual operating costs consist of the following:  recurring maintenance and repair costs,  utilities,  cleaning and janitorial costs, and  roads and grounds expenses  Main location refers to the street or delivery address for the asset or the latitude and  longitude coordinates.   Real property unique identifier is a code that is unique to a real property asset that will allow  for linkages to other information systems. The real property unique identifier is assigned by  the reporting agency and can contain up to 24 alpha-numeric digits.   The city or town associated with the reported main location in which the land, building, or  structure is located.  The state or District of Columbia associated with the reported main location in which the land,  building, or structure is located.  The country associated with the reported main location in which the land, building, or  structure is located.  The county associated with the reported main location in which the land, building, or structure  is located.  The congressional district associated with the reported main location in which the land,  building, or structure is located.  The ZIP code associated with the reported main location in which the land, building, or  structure is located.
section_title: Data element number Data element name 22
paragraphs: Data element definition  Installation identifier. Land, buildings or other structures, or any combination of these.  Examples of installations are a hydroelectric project, office building, warehouse building,  border station, base, post, camp, or an unimproved site.  Subinstallation identifier. Part of an installation identified by a different geographic location  code than that of the headquarters installation. An installation must be separated into  subinstallations and reported separately when the installation is located in more than one  state or county. However, an agency may elect to separate an installation into  subinstallations even if the installation is not located in more than one state or county.  Restrictions are limitations on the use of real property and include  environmental restrictions (cleanup-based restrictions, etc.),  natural resource restrictions (endangered species, sensitive habitats, floodplains, etc.),  cultural resource restrictions (archeological, historic, Native American resources, except  those excluded by Executive Order 13007, Section 304 of the National Historical  Preservation Act, etc.),  developmental (improvements) restrictions,  reversionary clauses from deed,  zoning restrictions,  easements,  rights of way, mineral interests, water rights,  air rights,  other,  not applicable  Agencies are required to provide all assets that have exited the federal portfolio of assets  during the reporting fiscal year. This will include, but is not limited to, sales, federal transfers,  public benefit conveyances, demolitions, and lease terminations. Disposition data is reported  only in the year the asset has exited the federal portfolio of assets.  Agencies are required to provide  status,  reporting agency,  real property unique identifier,  disposition.
Agencies are also required to report  disposition method (methods include public benefit conveyance, federal transfer, sale,  demolition, lease termination, or other),  disposition date,  disposition value (the PRV for public benefit conveyances, federal transfers, demolitions,  and other dispositions; the sales price for sales; and the government’s cost avoidance for  lease terminations),  net proceeds (the proceeds received as part of assets disposed through sales and  termination of leases minus the disposal costs incurred by the agency), and  recipient (the name of the federal agency or nonfederal recipient that received the  property through public benefit conveyance or federal transfer).
section_title: Data element number Data element name 25 Sustainability
paragraphs: Data element definition  Sustainability is reported for building assets, is optional reporting for structures, and is not  reported for land and reflects whether or not an asset meets the sustainability criteria set forth  in Section 2 (f) (ii) of Executive Order 13423. To be considered sustainable and report “yes,”  the asset must meet the five Guiding Principles for High Performance and Sustainable  Buildings or be third-party certified as sustainable by an American National Standards  Institute (ANSI)-accredited institution:  Yes. Asset has been evaluated and meets guidelines set forth in Section 2 (f) (ii) of  Executive Order 13423.
No. Asset has been evaluated and does not meet guidelines set forth in Section 2 (f) (ii)  of Executive Order 13423.
Not yet evaluated. Asset has not yet been evaluated on whether or not it meets  guidelines set forth in Section 2 (f) (ii) of Executive Order 13423.
Not applicable. Guidelines set forth in Section 2 (f) (ii) of Executive Order 13423 do not  apply to the asset. This includes assets that will be disposed of by the end of fiscal year  2015 and are no longer in use.
The legal interest element includes a lease maintenance indicator and a lease authority indicator,  which are not reported for “owned” and “otherwise managed” properties. This report focuses on  owned properties.
The status element includes an outgrant indicator identifying when the rights to the property have  been conveyed or granted to another entity. For the purposes of this report, we did not evaluate or  analyze information for the outgrant indicator.
section_title: Appendix III: Comments from the Office of Management and Budget
subsections: section_title: GAO Comments
paragraphs: 1.  OMB stated that the agency agreed with the report’s general  conclusion that challenges remain in the management of excess and  underutilized properties, but that significant progress has been made.   While we stated that limited progress has been made, our draft and  final report do not describe the progress as significant.   2.  OMB stated that the agency is concerned with some phrasing in the  report that may lead the reader to draw unintended conclusions  regarding the appropriate next steps for improving the accuracy and  consistency of the FRPP.  OMB stated that based on its  understanding of our report, our findings are based on the 26 site  visits we conducted and further study is needed to determine whether  the issues we found with the consistency and accuracy of FRPP data  are systemic.  OMB also asserts that despite our use of a non- probability sample, we make generalizations based on the sample in  the report.  As we discuss in the report and reiterated in discussions  with OMB staff during the comment period, our findings are primarily  based on the problems we found with FRPC’s data collection  practices, which affect the entire data collection process.  The work  we did at 26 sample sites complement those findings and illustrate  how poor data collection practices impact data submissions, but they  are not the only basis for our conclusions. Furthermore, in its  comments, OMB acknowledged that “it has been standard practice for  each agency to measure certain data elements, such as utilization,  through agency-specific means tailored to the agency’s individual  needs and circumstances.”  Therefore, it is unlikely, as OMB asserts,  that further study could find consistent data on properties outside of  our sample when OMB has acknowledged that the standards  themselves are inconsistent for reporting data.  For these reasons, we  believe our recommendation remains valid that GSA, in consultation  with FRPC, should first address the problems with data collection  practices, which our methodology and findings showed were in fact  systemic.  In response to OMB’s comment, we clarified the report to  emphasize the basis for our findings.  3.  OMB commented that this report conflicts with previous testimonies  and our 2011 update to GAO’s high-risk series which described prior  improvements.  This report acknowledges such prior progress but  provides a more in-depth review of multiple agencies’ data collection  practices than prior work.  Furthermore, as our report describes, in  December 2011, changes were made to the data collection  requirements which led to further concerns by agencies about data  accuracy.  Our report findings are also consistent with a September  2011 GAO report that discussed the Department of Defense’s FRPP  data.  In that report we found that the Department of Defense’s  reported FRPP utilization data consisted of multiple discrepancies  between the reported utilization designations and actual building  utilization, along with other FRPP submission inaccuracies. Therefore,  this report is consistent with our prior conclusions that some progress  has been made since 2003, which we have discussed in multiple  GAO reports and testimonies.  However, the report on the Department  of Defense’s data and this report demonstrated significant problems in  the data collection process.  4.  We believe that our first recommendation—that OMB develop a  national strategy—would assist in addressing the tension OMB  describes between providing agencies with the flexibility to define data  elements based on their agency-specific requirements and  establishing governmentwide data elements that can be used to  support aggregate analysis across the entire FRPP database.  We will  continue to engage OMB on the topic of real property management  and we believe that this report outlines the next steps.  As we  recommend in this report, a critical step is for OMB to develop a  national strategy for managing excess and underutilized properties.   In the area of data collection, a national strategy could help identify  management priorities for problems such as this and lay out the  principles for weighing the cost of uniform data collection to the  agencies with the benefit that would be obtained by aggregate  analysis of uniform data.  As we stated in the report, if certain data  elements cannot be collected consistently, they may not be  appropriate to include in a database that appears to be standard  across the government.  5.  We agree with OMB’s statement that the method of attributing cost  savings to efforts made to improve property management could be  further clarified so that the public has a clear understanding of how  such savings are calculated.  We believe that transparency and  accountability are critical in the federal government’s service to the  taxpayers and would support action taken by OMB to increase  transparency in this regard.  We did not make a specific  recommendation regarding how cost savings, particularly cost savings  associated with the June 2010 presidential memorandum, should be  clarified.  Our report assessed real property management issues  related to excess and underutilized property and recommended a  national strategy that could be used to guide efforts such as the June  2010 presidential memorandum.   6.  OMB stated that the report’s characterization of the administration’s  Civilian Property Realignment Act (CPRA) proposal could benefit from  further clarity on savings goals and further context about our recent  support for the proposal.  Regarding savings goals, OMB stated that  the administration’s $4.1 billion estimate of the potential proceeds  from the Act’s implementation reflects an analysis of the potential  proceeds that would result from the entire federal real property  inventory, not just those currently identified as “excess.”  We  acknowledged in the report that these savings, according to OMB,  would also come from reduced operating costs and efficiencies.  We  could not, however, analyze the basis for these savings because, as  we discussed, OMB did not provide us with a methodology,  calculations, or any basis for its stated projections.  We requested this  information from OMB multiple times over a period of eight months,  and were only provided with a general description of the savings,  similar to what OMB provided in its letter commenting on this report.   Until we can evaluate the analysis OMB references, we will be unable  to provide a more thorough assessment.   Furthermore, our views on  the effect that CPRA could have on problems we have found in  federal real property management have not changed:  that CPRA can  be somewhat responsive to real property management challenges  faced by the government.  For example, CPRA proposes an  independent board that would streamline the disposal process by  selecting properties it considers appropriate for public benefit uses.  This streamlined process could reduce disposal time and costs.  7.  OMB stated that the administration has a strategy for improving the  management of federal real property that serves as an important  foundation for the national strategy we recommend in this report.   OMB stated that several significant initiatives, including the June 2010  presidential memorandum on excess property and the  recommendation for a civilian property realignment board, represent a  comprehensive and carefully considered governmentwide strategy for  addressing the government’s long-term real property challenges.   While the efforts OMB describes represent a range of individual  initiatives, we continue to believe that they lack the key characteristics  of a cohesive national strategy.  A national strategy would improve the  likelihood that current initiatives to improve real property management  will be sustained across future administrations.  The desirable  characteristics of a national strategy that we’ve identified—such as a  clear purpose, scope, and methodology; problem definition and risk  assessment; and identified resources, investments, and risk  management—could serve to articulate a more sustained, long-term  strategy to guide individual initiatives such as those described in  OMB’s comments.  For example, related to resources and  investments, agencies often lack funding to prepare unneeded  properties for disposal or to pursue demolition.  A national strategy  could address this issue directly and transparently so that the true  costs of real property reform are evaluated more completely by  decision makers.
section_title: Appendix IV: Comments from the General Services Administration
subsections: section_title: GAO Comments
paragraphs: 1.  GSA stated that it is unclear whether the examples of inconsistencies  described in our report are systemic throughout the FRPP, or are  occurring in specific agencies’ reporting of the data.  As we discuss in  the report, our findings are primarily based on the problems we found  with FRPC’s data collection practices, which negatively impact the  entire data collection process.  The examples of inconsistencies and  inaccuracies that we describe complement those findings and  illustrate how poor data collection practices affect data submissions,  but they are not the only basis for our conclusions.  In fact, our  recommendation to improve FRPP data collection involves the sound  data collection practices that we believe should be put in place.  GSA  has agreed with this recommendation and has taken action to begin  correcting the problems we identified. In response to GSA’s  comments, we made some clarifications to the report’s discussion of  the basis of our findings.  2.  GSA stated that, because the FRPP is an annual report, property  utilization may change from the time it is submitted in December.  As  we conducted site visits for this review, we took steps to ensure that  any inconsistencies and inaccuracies we found were not due to a  significant change in the building’s use from the time it was reported  to the time we visited.  First, we discussed the history of the building’s  use with the local officials who manage the building to ensure that  there was no recent change in the building’s utilization.  Second, since  2011 FRPP data had not been reported at the time we began our site  visits, we obtained utilization data from the agencies’ source systems  (which are used to produce FRPP utilization data) so that we had  recent utilization data (as of the fall of 2011) before we began our site  visits in December 2011.
GSA also stated that the condition of the buildings may change or  may not be updated annually.  Related to this issue, we found that all  five agencies did not always follow the guidance provided by the  FRPC on how to calculate condition index.  This led to severely  blighted buildings receiving excellent condition scores, which could  not be accounted for by reported changes in condition over a  relatively short period of time.  3.  GSA made a comment related to the computation formula for  Condition Index. We have clarified this statement in the report.
section_title: Appendix V: Comments from the Department of Veterans Affairs
subsections: section_title: GAO Comments
paragraphs: 1.  VA stated that its complex model for calculating utilization is  consistent with FRPC guidance because the guidance allows for  flexibility on how agencies determine a key component of utilization  (current design capacity) and that OMB agreed with their approach.   However, rather than exercising flexibility in its use of current design  capacity, VA used a different definition of utilization than the definition  outlined in FRPC guidance.  FRPC guidance defines utilization as the  ratio of occupancy to current design capacity; however, VA defines  utilization as the ratio of ideal space to existing space. While we  acknowledge in our report that VA received OMB approval for  reporting utilization differently, this method of reporting utilization is  still inconsistent with the definition of utilization in FRPC guidance.   Utilization is a performance measure and the 2004 executive order  stated that performance measures shall be designed to allow  comparing the agencies’ performance against industry and other  public sector agencies.  The inconsistencies we found from VA and  other agencies in reporting utilization makes comparing utilization  among agencies impossible.  2.  VA also stated that “identifying underutilizations is much better than  ignoring the fact that the building may not be properly sized to deliver  services to Veterans.”  We did not suggest that VA should ignore any  aspect of its buildings that is problematic.  We continue to believe that  VA’s method of calculating utilization has led to some buildings being  continuously designated as underutilized even when local officials,  who know the buildings best, have told us that the buildings have  been fully occupied.  3.  VA stated that the reasons for the inaccuracies that we found in  utilization at two VA buildings were due to the use of these buildings  as “swing space,” meaning that utilization changes frequently based  on need for space.  In its comments, VA indicated that since FRPP  data are reported annually, the designation of this space at the time of  reporting changed from the time that we visited the sites.  However,  as we conducted our site visits for this review, we took steps to  ensure that any inconsistencies we found were not due to a significant  change in the building’s use from the time it was reported to the time  we visited.  First, we discussed the history of the building’s use since  2008 with the local officials who manage the building to ensure that  there was no recent change in the building’s utilization.  Second, since  2011 FRPP data had not been reported at the time we began our site  visits, we obtained utilization data from the agencies’ source systems  (which are used to produce FRPP utilization data) so that we had  recent utilization data (as of the fall of 2011).  The data we obtained  from VA were current as of October 2011 and our visit took place in  December 2011.   Based on VA’s comments, we clarified this  information in our report to show that we accounted for the time  between 2010 FRPP reporting and our visit in December 2011.   Based on our visits to the buildings and our discussions about the  history of the buildings’ use with the VA officials who manage them,  we do not believe that VA’s explanation accounts for the  inconsistencies we found in utilization as detailed below:
Local VA officials who manage the buildings told us that the first  building VA discussed in its comments is used for accounting and  payroll purposes and that it was always fully occupied during the  period of our review (dating back to 2008).  However, the building  was reported to the FRPP as underutilized during each of these  years.  In fact, just two months prior to our visit, VA’s October  2011 source data showed a utilization of 45 percent for this  building even though it was fully occupied.
Local VA officials who manage the second building VA discussed  in its comments told us that the building was mostly unoccupied  because they had recently acquired it from the Department of  Defense and that multiple improvements had to be made before it  could be occupied by staff.  Based on this, the local officials told  us that it could not have been utilized at 59 percent in October  2011 as VA source data indicated.   4.  VA made a comment related to individually metered buildings. We  clarified VA’s statement in the report so that it is consistent with these  comments. 5.  In reference to our findings on problems with cost savings associated  with the June 2010 presidential memorandum, VA stated that it  disagreed with findings in a previous GAO report (GAO-12-305) that  we referenced.  In its comments on GAO-12-305, VA officials did not  concur with certain parts of the report related to decreasing energy  costs and improving non-recurring maintenance contracting.   However, we did not reference the previous GAO report on these  matters.  Rather, we referenced that report’s discussion on savings  associated with reducing leased space through telework.  VA  confirmed the problems that the previous GAO team found with the  savings associated with the telework program in its comments on  GAO-12-305, stating that the “telework program is still in its infancy  and actual real property savings requires reducing space that is  currently leased.  These reductions in leased space may not be fully  realized in 2012.”  As a result, VA stated it its comments on GAO-12- 305 that the telework initiative was removed from the description of  savings in its fiscal year 2013 budget.  This is consistent with what we  describe in this report.  Therefore, VA’s restatement of its  disagreement with findings in GAO-12-305 has no bearing on this  report.
section_title: Appendix VI: Comments from the U.S. Department of Agriculture
section_title: Appendix VII: GAO Contact and Staff Acknowledgments
subsections: section_title: GAO Contact
section_title: Staff Acknowledgments
paragraphs: In addition to the contact named above, David Sausville, Assistant  Director; Amy Abramowitz; Russell Burnett; Kathleen Gilhooly; Raymond  Griffith; Amy Higgins; Amber Keyser; Michael Mgebroff; John Mingus Jr.;  Joshua Ormond; Amy Rosewarne; Minette Richardson; Sandra Sokol;  and Elizabeth Wood made key contributions to this report.