Underutilized Facilities: DOD and GSA Information Sharing May Enhance Opportunities to Use Space at Military Installations
Published: 2015-06-18T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: GAO has designated DOD's Support Infrastructure Management as a high-risk area in part due to challenges in reducing excess infrastructure. DOD installations can establish agreements to allow entities such as non-DOD federal agencies and private entities to use property on DOD installations that are unutilized or underutilized. DOD reports that, as of the end of fiscal year 2013, its real property portfolio consisted of more than 562,000 facilities with an estimated value of $850 billion.
The National Defense Authorization Act for Fiscal Year 2014 included a provision that GAO review the potential for relocating federal government tenants onto military installations. This report identifies (1) available options for DOD to allow non-DOD entities to use unutilized and underutilized space on military installations, and what factors DOD considers for each option; (2) any limitations and benefits of bringing non-DOD federal tenants onto military installations, and (3) the extent to which DOD and other federal agencies coordinate to do so. GAO evaluated DOD and military service guidance; visited selected installations having non-DOD tenants, including two that support the Arctic mission; and interviewed cognizant officials.
section_title: What GAO Found
paragraphs: Department of Defense (DOD) guidance outlines options for granting the use of unutilized (vacant) and underutilized (partially vacant) space on military installations to non-DOD entities, such as other federal agencies, and installations consider several factors when contemplating such grants. For example, DOD and military department guidance identifies the real estate instruments, such as leases and licenses that are to be used to issue grants to non-DOD entities. All seven of the installations that GAO visited reported using this guidance to select the appropriate instrument based on the type of non-DOD entity, type of facility, and proposed use of the asset. For example, installations selected permits as the appropriate real estate instrument when issuing grants to a non-DOD federal agency as outlined in DOD and military department guidance. Prior to granting the use of space to a non-DOD entity, officials at installations reported considering several factors, including the availability of space, effect on the mission, and factors unique to the installation. In instances where there are competing interests for space, officials reported considering priorities set forth in DOD guidance for assigning available space on the installation. Officials also reported considering whether the tenant could potentially have a negative effect on the installation's ability to comply with any regulations, such as preserving protected habitats.
DOD faces both limitations and benefits from moving non-DOD agencies onto installations. Limitations such as the availability of suitable space affect DOD's ability to bring non-DOD federal agencies onto military installations. For example, officials at all seven of the installations GAO visited reported a lack of vacant space or vacant space that is usable, which limited their ability to accommodate space requests. However, when a match can be made between an installation's available space and a potential tenant agency's needs, both parties can benefit. For example, installations can potentially benefit through the avoidance of direct and indirect costs, such as the cost for utilities and maintenance incurred for unused or underutilized space. Non-DOD federal agencies can save costs on commercial leases because DOD charges for use of space by other federal entities on a cost-recovery basis.
Despite the potential benefits, routine information sharing does not occur between DOD and the General Services Administration (GSA) concerning opportunities to move non-DOD federal agencies onto military installations. Specifically, when GSA is working to satisfy the space needs of its clients, it does not routinely contact DOD installations to inquire whether space might be available. DOD, on the other hand, waits for non-DOD federal agencies to inquire whether space is available and does not generally reach out to GSA or agencies that may be interested in space. Without taking actions to share information, GSA offices working with non-DOD federal agencies to find them space may risk missing opportunities for their clients to reduce or avoid costs. In addition, both GSA and DOD may miss opportunities to leverage resources and enhance utilization of federal real property.
section_title: What GAO Recommends
paragraphs: GAO recommends that DOD and GSA collaborate to enhance routine information sharing concerning non-DOD federal agencies seeking workspace at military installations. DOD and GSA concurred and agreed to take action to help ensure that government-owned assets are used to capacity.

section_title: Letter
paragraphs: Since 1997, we have designated the Department of Defense’s (DOD)  Support Infrastructure Management as a high-risk area, in part due to the  challenges DOD faces in reducing excess and obsolete infrastructure.  DOD reports that, as of the end of fiscal year 2013, the global real  property portfolio it manages consisted of more than 562,000 facilities  (buildings, structures, and linear structures), located on over 4,800 sites  worldwide, covering more than 24.7 million acres, and with a value of  approximately $850 billion. However, this portfolio includes property that  is currently unutilized (vacant) and underutilized (partially vacant), but  may be needed in the future. The operation and maintenance of  unutilized and underutilized facilities consumes valuable resources that  could be eliminated from DOD’s budget or used by DOD for other  purposes. DOD installations can establish outgrants—agreements with  tenants, such as other DOD organizations, non-DOD federal agencies,  and other government and private entities—to allow use of property on  DOD installations that are unutilized or underutilized. Such agreements  may offer potential opportunities for financial benefits, including reduced  maintenance costs to DOD. In March 2015, the Acting Assistant  Secretary of Defense for Energy, Installations, and Environment testified  that a 2004 study concluded that DOD had 24 percent aggregate excess  infrastructure capacity and that DOD’s 2005 base realignment and  closure process disposed of 3.4 percent of those facilities.
In addition, we have designated federal real property management as a  high-risk area since 2003 in part because the federal government  continues to maintain too much excess and underutilized property and  relies too heavily on costly leases. property holdings are vast and diverse—comprising hundreds of  thousands of buildings and permanent structures across the country, and  costing billions of dollars annually to operate and maintain. The need to  better utilize existing real property has been the focus of government- wide efforts since at least 2004. Most recently, on March 25, 2015, the  Office of Management and Budget issued a memorandum to clarify the  existing policy to dispose of excess properties and promote more efficient  use of real property assets.
GAO, High-Risk Series: An Update, GAO-15-290 (Washington, D.C.: February 2015). incomplete and inaccurate. In addition, we found that OSD did not have a  strategic plan to manage DOD’s real property efficiently and facilitate the  identification of opportunities for consolidating unutilized or underutilized  facilities. We recommended that DOD establish a strategic plan to identify  any unutilized and underutilized facilities as part of a results-oriented  management framework. DOD concurred with our recommendation and  stated that as of September 2014, a strategy review was under way with  initial guidance and initiatives to be identified by the close of calendar  year 2014. According to a DOD official, as of February 2015, DOD had  developed a strategic plan for identifying underutilized and unutilized  assets and is currently coordinating with the military services to establish  an implementation approach. Our prior work also has concluded that  collaboration can be used to enable agencies to become better stewards  of government resources. Specifically, we identified certain practices that  can help enhance and sustain collaboration among federal agencies,  including establishing compatible policies, procedures, and other means  to operate across agency boundaries, which can be accomplished  through frequent communication among collaborating agencies.
The National Defense Authorization Act for Fiscal Year 2014 included a  provision that GAO report on the potential for relocating federal  government tenants onto military installations in the United States. This  report identifies (1) what options, if any, are available for DOD to allow  non-DOD entities, including federal government agencies, to use  unutilized and underutilized space on military installations, and what  factors DOD considers when considering exercising each option; (2) any  limitations and benefits of bringing non-DOD federal agencies onto  installations, and (3) the extent to which DOD and other federal agencies  coordinate to do so.
To address our objectives, we reviewed applicable DOD and military  department guidance pertaining to real property management and  support agreements. To provide context concerning non-DOD entities  using space on military installations, we selected seven installations to  visit based on (1) the number of real property assets that were identified  in DOD’s Real Property Assets Database (RPAD) as being used by non- DOD federal agencies at the end of fiscal year 2013, and (2) installations  supporting DOD’s Arctic mission, to respond to a consideration in the  mandate. generalizable. While we have previously reported on inaccurate and  incomplete utilization data in the database, we determined that the RPAD  data were sufficiently reliable for the purposes of selecting installations to  visit. Using these factors, we selected the installation from each military  service that had the greatest number of real property assets identified as  being used by non-DOD federal agencies, two installations that supported  DOD’s Arctic mission, and two installations that had a relatively small  number of real property assets identified as being used by non-DOD  federal agencies. We also reviewed installation processes for identifying  and managing unutilized and underutilized facilities.
The installations we visited were selected from a universe of 100 installations located in  the United States and its territories that DOD considers large sites because the real  property assets at these sites had plant replacement value of $1.794 billion or greater.  The National Defense Authorization Act for Fiscal Year 2014 included a provision for GAO  to evaluate the potential for and obstacles to consolidation of federal tenants on  installations that support Arctic missions, focusing on federal entities with homeland  security, defense, international trade, commerce, and other national security functions that  are compatible with the missions of military installations, or can be used to protect national  interests in the Arctic region.
To determine what options, if any, are available for DOD to allow non- DOD entities, including federal government agencies, to use unutilized  and underutilized space on military installations and the factors DOD  considers, we reviewed applicable DOD and military department  guidance to identify (1) the circumstances under which non-DOD tenants  are allowed to utilize space on military installations including the order of  priority among non-DOD tenants, and (2) the types of agreements and  understandings that installations are allowed to enter into with non-DOD  tenants. In addition, we interviewed responsible officials at OSD, the  military department headquarters, and seven selected installations to  determine their roles in bringing a non-DOD tenant onto a military  installation and the factors that each considered.
To identify the limitations and benefits of bringing non-DOD federal  agencies onto installations, we reviewed applicable DOD and military  department guidance, including regulations and instructions, to identify  whether a process exists to promote the use of unutilized or underutilized  space by non-DOD federal agencies. We also interviewed OSD, military  department headquarters, and responsible installation officials to obtain  their perspectives concerning the process by which non-DOD entities are  provided space on DOD installations as well as the limitations and  benefits that exist to allowing non-DOD federal agencies to use space on  military installations.
To determine the extent to which DOD and other federal agencies  coordinate to better use unutilized and underutilized facilities on military  installations, we reviewed General Services Administration (GSA)  guidance on its process to seek and assign space to its clients and  interviewed cognizant GSA officials concerning that process, to determine  whether it includes coordination with landholding agencies such as DOD.  We also interviewed responsible OSD, military department headquarters,  and installation officials to obtain their perspectives on coordination  between DOD and GSA. We compared that information to criteria on  practices to enhance collaboration among federal agencies that we  identified previously.methodology can be found in appendix I.
Further details on our objectives, scope, and  We conducted this performance audit from March 2014 to June 2015 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 provides a reasonable basis for our findings and  conclusions based on our audit objectives.
subsections: section_title: Background
subsections: section_title: DOD and Military Department Guidance Governs Management of Infrastructure
paragraphs: DOD’s Real Property Management Program is governed by statute and  DOD regulations, directives, and instructions that establish real property  accountability and financial reporting requirements. These laws,  regulations, directives, and instructions require DOD and the military  departments to maintain a number of data elements about their facilities  to help ensure efficient property management which, among other things,  could help identify potential facility consolidation opportunities.
Logistics and the Secretaries of the military departments. Specifically,  the directive assigns overall responsibility and oversight of DOD real  property to the Under Secretary of Defense for Acquisition, Technology  and Logistics, but assigns specific responsibilities for real property  management to the Secretaries of the three military departments,  including implementing policies and programs to acquire, manage, and  dispose of real property. Accordingly, each of the military departments  has developed its own procedures and guidance for managing its  infrastructure. Some of the key guidance used by the military departments  for managing real property includes Army Regulation 405-70; Naval  Facilities Engineering Command P-78; and Air Force Policy Directive 32- 10.
Military department guidance requires, among other things, that real  property records be accurate and be managed efficiently and  economically. It also requires the military departments to maintain a  complete and accurate real property inventory with up-to-date  information, to annually certify that the real property inventory has been  reconciled, and to ensure that all real property holdings under the military  departments’ control are being used to the maximum extent possible  consistent with both peacetime and mobilization requirements. In  managing the real property under their control, the Secretaries of the  military departments are responsible for implementing real property  policies and programs to, among other things, hold or make plans to  obtain the land and facilities they need for their own missions and for  other DOD components’ missions that are supported by the military  departments’ real property. Additionally, the military departments are  required to (1) budget for and financially manage so as to meet their own  real property requirements; (2) establish and maintain accurate inventory  to account for their land and facilities; and (3) maintain a program  monitoring the use of real property to ensure that all holdings under their  control are being used to the maximum extent possible consistent with  both peacetime and mobilization requirements.
Generally, the military departments rely on the installations to manage  and monitor the utilization of facilities. According to OSD guidance,  installations are required to conduct inventories for each real property  asset every 5 years except for those real property assets designated as  historic, which are to be reviewed and physically inventoried every 3  years. According to DOD Instruction 4165.70, the military departments’  real property administrators are accountable for maintaining a current  inventory count of the military departments’ facilities and up-to-date  information regarding, among other things, the status, condition,  utilization, present value, and remaining useful life of each real property  asset. Inventory counts and associated information should be current as  of the last day of each fiscal year. In addition, DOD Instruction 4165.70  requires the DOD components to periodically review their real property  holdings, both land and facilities, to identify unneeded and underutilized  property. Underutilized property represents assets that are needed to  meet current or projected defense requirements, but are not currently  utilized to the maximum extent possible. Such assets can be considered  for temporary use by other DOD entities, other federal agencies, state  and local governments, or private entities which is also referred to as  outgranting. DOD guidance establishes the types of agreements that are  used to document the support that military installations provide to their  tenants.
See 40 U.S.C. § 102 (3) and Department of Defense Directive 4165.06, Real Property. external factors that may affect future disposal efforts. DOD concurred  with this recommendation and stated that it would work with the military  departments to continue to develop and implement the most effective and  efficient methods to eliminate excess facilities and capacity, but did not  provide any details or specific time frames for these efforts.
section_title: GSA’s Role in Managing Federal Real Property
paragraphs: GSA has key leadership responsibilities related to real property  management for the federal government. First, GSA is authorized by law  to acquire, manage, utilize, and dispose of real property for most federal  agencies, a function that is commonly referred to as the landlord role.  This function is performed by GSA’s Public Buildings Service; GSA has  an inventory of about 9,000 government-owned or government-leased  facilities. GSA is responsible for managing the life cycle of federally  owned assets, including eventually disposing of such properties and  entering into, renewing, and terminating contracts for leased properties.  Second, in a government-wide policy role, GSA sets real property  management policy for the federal government as a whole. GSA’s Office  of Government-wide Policy is tasked, among other things, to identify,  evaluate, and promote best practices to improve efficiency of  management processes. In this policy role, GSA also supports the  Federal Real Property Council by providing oversight guidance,  publishing performance measures, and maintaining the Federal Real  Property Profile (FRPP) database. Additionally, the Freeze the Footprint  policy assigns GSA leadership responsibilities, directing GSA to consult  with other agencies on promoting full implementation of the policy,  including how to use technology and space management to consolidate,  increase occupancy rates in facilities, and eliminate lease arrangements  that are not cost or space effective.
section_title: DOD’s Options for Granting the Use of Space to Non-DOD Entities Are Outlined in Guidance, and Several Factors Are Considered by Installations
subsections: section_title: DOD and Military Department Guidance Identify the Real Estate Instruments and Support Agreements Used to Grant Space
paragraphs: DOD and military department guidance identify the real estate  instruments used to issue outgrants, and—depending on the type of non- DOD tenant and type of facility occupied—the appropriate instances in  which to use each real estate instrument. The military installations can  use a variety of real estate instruments to issue outgrants.
Leases grant a nonfederal entity exclusive possession of real  property for a specified term in return for rent or other consideration. For example, an installation may grant a lease for a credit union to  build a branch office.
Enhanced Use Leases (EUL) refer to more complex leases into  which the military departments may enter. EULs generally provide  for in-kind consideration, and some EULs involve complex  agreements and long terms. For example, an EUL might provide  for a 50-year lease of military land to a private developer that  would be expected to construct office or other commercial  buildings on the land and then rent the facilities to private-sector  tenants for profit.
Consideration refers to cash or in-kind payment by the lessee in exchange for the lease.  In the context of DOD’s general leasing authority, payment in kind may take the form of  maintenance, protection, alteration, improvement, or restoration of property or facilities,  among other things.
Licenses grant any entity the use of space at an installation for a  specific purpose generally in return for rent or other in-kind  consideration. For example, an installation may grant a license to a  YMCA program for carrying out activities for youths.
Permits are licenses granted to non-DOD federal agencies  generally in return for reimbursement of direct and indirect costs,  as required by DOD guidance. Examples of direct and indirect  reimbursement for costs include utilities, maintenance, and other  services.
Easements grant any entity a right to use or pass over parcels of land  in specific ways; for example, to install and run utility lines across an  installation, or to build roads, streets, or railroad tracks.
Officials at all seven of the installations that we visited reported selecting  the appropriate real estate instrument based on the type of non-DOD  entity occupying space at the installation, the type of facility, and the  proposed use of the asset. The type of entity can include federal agencies  other than DOD, state and local governments, and nongovernmental and  private organizations, while the type of facility can include buildings,  structures, and linear structures. Table 1 below illustrates the relationship  that exists among the type of non-DOD entity, the type of real estate  instrument, and the type of real property asset.
All seven of the installations we visited had established outgrants with at  least one non-DOD federal agency as well as with other DOD entities,  state and local governments, and private organizations to varying  degrees. For example, these installations had established leases with  public school districts, credit unions, and nonprofit organizations and had  easements with local utility companies and state transportation agencies.  None of the installations we visited had any EULs in place with nonfederal  entities.
DOD and military department guidance also outline several types of  support agreements that installations can use to document specific  provisions of their agreements with tenant organizations. The support  agreements used at the installations that we visited include the following:
DD Form 1144: This form is used in instances where there is a need  to document recurring reimbursable support that an installation  provides to a federal agency, such as utilities, refuse disposal, and  other services.
Memorandums of Understanding: These document areas of  general understanding that do not involve reimbursement, such as  expiration dates and procedures to mediate disputes.
Memorandums of Agreement: These document specific terms and  responsibilities for a single reimbursable purchase, nonrecurring  reimbursable support, or nonreimbursable support, and include  financial provisions, such as billing and payment terms.
section_title: Several Factors Are Considered in Determining Whether to Grant Space to Non-DOD Entities
paragraphs: While DOD and military service guidance provide the tools for  installations to issue several types of outgrants, officials must first  determine the viability and desirability of bringing a tenant onto the base.  Prior to granting the use of space to a non-DOD entity, officials at the  installations we visited reported considering several factors. These factors  generally fit into three categories: (1) general factors, (2) mission-related  factors, and (3) local factors. General factors include considerations  related to the availability of space, mission-related factors take into  account the effect that a proposed tenant would have on the ability of the  installation to perform its mission, and local factors include unique  circumstances that exist on a particular installation. The factors discussed  below represent the considerations identified by officials at the seven  installations that we visited, but are not an exhaustive list of all the  possible factors that an installation could consider in granting the use of  space to a non-DOD entity.
subsections: section_title: General Factors
paragraphs: One of the general factors that officials at all seven installations we visited  reported considering is whether they have space available that is suitable  for the tenant. In making this determination, installation officials  considered whether the installation had the amount and type of space  available to support the proposed activity that the tenant would be  bringing onto the installation. If suitable space is identified, a second  factor that officials at all seven installations reported considering was  whether the installation had competing interests for real property assets  that are available. Generally, installations are required to prioritize the  order in which non-DOD entities are granted space. DOD Instruction  4165.70 provides the priorities for considering requests from DOD or non- DOD entities to use unutilized or underutilized space. According to the  instruction, an installation’s first priority is DOD entities. Assuming no  DOD organizations have a need, the next priority for outgrants is federal  agencies whose mission on the installation is closely associated with  the installation’s national defense mission. Third, installations should  provide space to other federal agencies above local government or  private entities. Fourth, installations must prioritize nonfederal  government entities, such as state and municipal agencies, over private  organizations. Finally, in the event that there are no competing interests,  installations may grant space to private organizations.
section_title: Mission-Related Factors
paragraphs: One of the mission-related factors officials at all seven of the installations  we visited reported considering is whether the installation needs to allow  unutilized or underutilized space to remain vacant in order to meet future  DOD needs in support of its mission. Installation officials estimated their  facility needs to address anticipated changes in DOD’s force structure or  mission such as needing more facilities to move or house service  members and supporting civilian employees in the event of a new  contingency, including the need to mobilize reserves. In this instance,  granting space to a tenant may preclude the installation from  accommodating fluctuations in its force.
A related factor that officials at six of the seven installations we visited  reported considering is whether the requested space conforms to the  Installation Master Plan, which contains the installation’s planned layout  of its assets to support the mission. Officials stated that any space that is  granted to non-DOD entities cannot be used for a purpose that conflicts  with the Master Plan’s layout of the installation’s infrastructure. For  example, installations will not grant space to a tenant that requests  industrial space in an area that the Master Plan has designated for  residential use.
Another mission-related factor officials at five of the seven installations we  visited reported considering is whether the tenant’s presence will  negatively affect the installation’s required level of security. Installations  have different security measures with varying degrees of stringency, in  part to safeguard the integrity of the mission. For example, Kirtland Air  Force Base, New Mexico, controls civilian access to its premises in part  to safeguard the sensitive nature of some material and information that is  housed within its premises, including some work that is carried out by the  Department of Energy. In this case, officials would have to consider  whether having a non-DOD tenant would increase the number of civilians  on the base, which could in turn create additional vulnerabilities that  would not be mitigated through existing security measures.
Another mission-related factor that officials at all of the installations we  visited reported considering when bringing additional tenants onto the  base is the effect on the installation’s infrastructure. Specifically, officials  said they considered whether the installation’s existing infrastructure,  such as the electrical distribution system, sewage lines, water pipes, and  roads can adequately accommodate additional tenants. For example,  officials with whom we spoke at Marine Corps Base Quantico, Virginia,  explained that the installation’s existing roads could not accommodate the  increase in traffic volume that resulted from an increase in personnel  inside the Federal Bureau of Investigation compound. To mitigate this  problem, Marine Corps officials worked with the bureau and the  Department of Justice to secure funding for the construction of additional  roads to accommodate the added traffic on the installation.
section_title: Local Factors
paragraphs: Officials that we spoke with at three of the seven installations we visited  mentioned that local topography can be a factor that is considered when  evaluating whether to grant space to a non-DOD tenant. For example,  according to officials at Joint Base Elmendorf-Richardson, Alaska, partly  because of the presence of mountains on the boundary of the installation  and its proximity to a significant amount of marshlands—and  environmental regulations related to these—the installation has limited  opportunity to expand, which limits its ability to bring entities onto the  base. Officials at all seven of the installations we visited stated that the  effect that tenants may have on the local environment must be  considered. For example, officials at Naval Base Coronado, California  stated that there are a large number of endangered species present on  the installation, which requires the completion of an environmental  assessment prior to authorizing additional tenants coming onto the  installation. Finally, some officials also mentioned that there are local  agreements that are considered. For example, Kirtland Air Force Base  must consider the local effect that existing regional and federal  agreements with Native American groups may have on the installation’s  ability to grant space to non-DOD tenants.
section_title: Tenancy on Military Installations Has Limitations and Benefits
subsections: section_title: Some Limitations Exist Related to DOD’s Ability to Bring Non-DOD Tenants onto Installations
paragraphs: Several limitations can affect a military installation’s ability to bring non- DOD tenants onto an installation. First, the installation would have to  have available space that is suitable for a tenant’s needs to successfully  bring a potential tenant onto a base. Officials at all seven of the military  installations we visited cited limitations in accommodating space requests  from potential tenants due to a lack of vacant space that aligns with the  tenant’s request, such as the amount of space or type of space needed,  or vacant space that is not in suitable condition. Specifically, officials at  the seven installations we visited reported that they were either short on  suitable space or that the vacant space they did have was in poor  condition, or both. Officials at one installation said that because the  space may not be in good condition, the need for renovations may limit  the desirability of the space for potential tenants.
A second limitation that can affect the ability of an installation to bring  non-DOD tenants onto the installation is that the process is reactive in  nature. Specifically, officials from OSD and the services stated that the  process of providing space to non-DOD federal agencies generally starts  when potential tenants approach the installations to request space and is  usually not initiated by the services or installations in an effort to find  tenants. Officials at six of the seven installations we visited stated that  they did not actively pursue opportunities to bring non-DOD federal  agencies onto the installation, but reacted to space requests initiated by  the potential tenants. At one installation—Fort Bliss, Texas—officials  stated that previous installation commanders pursued potential tenants  with compatible missions using informal networking and meetings.  According to the officials, this approach is not currently needed because  new missions assigned to Fort Bliss have increased use of space at the  installation. Moreover, installation officials reported a lack of non-DOD  federal agency requests for space. While all the installations we visited  had non-DOD federal tenants as of March 2015, officials at four of the  seven installations stated that they receive few new requests for space  from non-DOD federal agencies. In some cases, this may stem from a  limited demand for space in particular areas. For example, at Eielson Air  Force Base outside of Fairbanks, Alaska, officials reported that the base  received few space requests because there are few non-DOD federal  agencies in the local area. Also, the base is located approximately 20  miles from Fairbanks, which installation officials said may not be desirable  for potential tenants. In other cases, this may be the result of a lack of  information sharing among agencies that may have a need for space. For  example, at each of the installations we visited, none had shared  information routinely with other federal agencies or GSA concerning  available space at the installation. For example, none of the installations  had contacted or were contacted by GSA, which has a key role in  acquiring real property for the federal government and would have  knowledge of the space needs of multiple federal agencies regionally or  locally. We discuss this issue in greater detail later in this report.
Finally, officials at each military installation we visited also reported that  limitations specific to their location could affect their ability to bring non- DOD tenants onto the installation. For example, Joint Base Elmendorf- Richardson officials explained that because of certain agreements that  affect the rights to land on the installation, the installation must exercise  care when creating an outgrant to ensure that the outgrant agreement  does not conflict with the preexisting agreements. According to officials at  Kirtland Air Force Base, New Mexico, when Kirtland was expanded in  1971 to incorporate two nearby installations, the new boundaries of the  installation encompassed land that remains under the control of other  federal entities. Consequently, Kirtland does not have the unilateral  authority to authorize the use of these lands or the facilities located on  them.
section_title: Bringing Non-DOD Federal Agencies onto Military Installations Can Provide Benefits to the Installation and Tenant Agency
paragraphs: While there are limitations to bringing tenants onto military installations,  according to installation officials, both the installation and tenant agency  can benefit when a match can be made between an installation’s  available space and the tenant agency’s needs. Specifically, an  installation can receive benefits in the form of services provided by the  tenant agency. For example, officials at Kirtland Air Force Base, New  Mexico, said that the Federal Aviation Administration provides air traffic  control services to the base, and officials at Camp Pendleton, California,  said the U.S. Coast Guard presence provides offshore security to the  installation. In addition, installations can receive financial benefits from  having non-DOD federal agency tenants on the installation by avoiding  utility and maintenance costs for tenant-occupied facilities that would  have otherwise been incurred. Officials at six of the seven installations  we visited noted that the reimbursement of direct and indirect costs for  these facilities can provide a financial benefit to the installations.
Non-DOD federal agencies can also benefit from using space on military  installations. For example, non-DOD federal agencies could receive a  financial benefit from being located on a military installation due to  differences in costs charged by DOD when compared with the costs of  commercial leases. Specifically, a DOD instruction allows military  installations to collect reimbursements from non-DOD federal agencies  for direct and indirect costs such as utilities, maintenance, and services  provided, but generally do not allow installations to collect additional rent  beyond cost recovery. According to installation officials at all seven  installation we visited, the installations did not collect more than the  reimbursements for direct and indirect costs, and did not charge any  additional rent beyond cost recovery, which represented a savings to the  tenant agency. In addition, there are occasions where the non-DOD  federal tenant receives nonfinancial benefits from being located on a  military installation. For example, the Department of Energy receives the  benefit of the installation security for its facilities located on Kirtland Air  Force Base, New Mexico, which represents potential cost avoidance for  the department.
Finally, both the installation and the agency can benefit from having the  non-DOD federal agency on the military installation to accomplish a  shared mission. For example, the Coast Guard recently became a tenant  at Joint Base Elmendorf-Richardson, enabling both the installation and  the Coast Guard to better accomplish their search and rescue mission.  Specifically, the installation is responsible for the air portion of the mission  and the Coast Guard is responsible for the sea portion of the mission.  Being located on the same installation enables them to coordinate  training in preparation to execute the search and rescue mission.
section_title: DOD and GSA Do Not Routinely Share Information Concerning Opportunities to Use Unutilized or Underutilized Facilities
paragraphs: Despite the benefits to DOD and non-DOD federal agencies, routine  information sharing does not occur between DOD and GSA concerning  opportunities to move non-DOD federal agencies onto military  installations to make better use of unutilized and underutilized facilities,  although GSA may have information on agencies near an installation  needing space. Government-wide efforts continue to focus on the need to  better utilize existing real property assets in order to promote efficiency  and leverage government resources, which can be facilitated by  coordination between federal agencies. The 2015 National Strategy for  Real Property states that execution of opportunities to improve space  utilization is one way in which the federal government can improve its  management and use of federal assets to maximize the use of scarce  budgetary resources. The strategy includes a focus on reducing and  promoting more efficient use of the federal office and warehouse  footprints—property categories in which DOD controls approximately 35  percent and 48 percent of the federal space, respectively. One way  agencies can become better stewards of government resources is  through enhancing and sustaining collaboration and coordination, which  can be accomplished through various practices, including operating  across agency boundaries through compatible policies, procedures, and  frequent communication. Frequent communication would encourage the  sharing of information that could be used to better utilize facilities on  military installations. For example, in July 2012 we concluded that  coordinated efforts at the local and regional level could enhance  information sharing and facilitate increased utilization of federal real  property, which could in turn result in cost savings or avoidance through  the reduction of leased space.
As part of its role of acquiring, managing, and utilizing federal real  property, according to GSA, it provides workspace to federal agencies at  the best value for the American taxpayer by leveraging limited  government resources and proactively working with agencies to maximize  use of space. GSA works with non-DOD federal agencies to help them  seek and obtain space. Non-DOD federal agency clients can begin this  process by calling a regional GSA office and providing information on  their program and mission requirements, such as the required geographic  area, estimated total square footage needed, and how long the space is  needed, among other things. GSA will then review that information, work  with the agency to clarify and refine the requirements as necessary, and  search within the defined geographic area for suitable federally controlled  space—either owned or leased. According to GSA, placing a federal  agency in owned space is generally a better long-term solution and  provides cost-savings over time. According to GSA officials, the search  for suitable federally controlled space includes a check of GSA-owned  and GSA-leased real property. If there is no suitable GSA space  available, GSA will then seek space in United States Postal Service  facilities, per a memorandum of agreement between the two agencies  and the Federal Management Regulation, before helping its clients to  acquire space through a commercial lease.
Even though DOD holds over 60 percent of all federal real property and  GSA may have information on agencies near an installation needing  space, according to GSA officials, the process to seek and assign space  to its non-DOD federal agency clients does not include sharing this  information with DOD or other federal landholding agencies, with the  exception of the Postal Service. Specifically, the GSA officials with whom  we spoke reported that generally regional GSA offices do not  communicate with military installations to identify whether there may be  suitable vacant space in the installation-level real property inventories,  which is information maintained by the installations. The officials also  stated that if a client were to express interest in space on a military  installation, GSA would direct the client to contact the installation directly  and would have little to no involvement with the installation concerning  the details of any agreement between DOD and the non-DOD federal  agency for the use of space on a military installation. For example, the  officials identified one instance where GSA provided the Department of  State with a point of contact in the Army so that the Department of State  could inquire directly with the Army concerning the potential for using  training space on a local installation.
The GSA officials with whom we spoke said that a primary reason GSA  does not routinely coordinate with DOD concerning the availability of  unutilized and underutilized space is that they assume that space in  DOD-owned facilities typically would not meet the needs of GSA’s non- DOD federal agency clients because installation security requirements  and locations are not likely to be compatible with the non-DOD federal  agency missions. However, DOD reports having non-DOD federal tenants  on many of its installations, although such factors can limit some non- DOD federal agencies from being located on a military installation in  some circumstances. Therefore, there are instances when a non-DOD  federal agency’s space needs can be met on military installations.  Further, GSA’s assumption that agencies’ needs cannot be met on a  military installation may preemptively limit options available to the  agencies for which GSA is working to find space and thus the non-DOD  federal agency tenants do not receive full information on potential  facilities located on the installations.
DOD also does not routinely share information with GSA or other non- DOD federal agencies when space is available on military installations. In  addition to the government-wide guidance to better utilize federal  property, DOD Instruction 4165.70 directs the Secretaries of the military  departments to maintain a program that monitors the use of real property  to ensure that it is being used to the maximum extent possible consistent  with both peacetime and mobilization requirements. We found that  military installations do not routinely share information with GSA or other  non-DOD federal agencies when space is available in part because, as  stated before, military installations generally wait for non-DOD federal  agencies to inquire about available space. DOD officials at the OSD,  service, and installation levels said that they do not conduct outreach to  communicate information regarding unutilized and underutilized space on  military installations in part because the installations primarily focus on  supporting missions within DOD, not other non-DOD federal agencies.  However, when there is available space on military installations that is not  currently used by other DOD entities, DOD’s process to wait for agencies  to approach installations does not assist the installation in utilizing their  space to the maximum extent possible consistent with military  requirements as required by DOD policy.
Further, department-level and installation-level officials said they had not  interacted or shared information with GSA concerning the availability of  space on installations that might be suitable for non-DOD federal  agencies that are working with GSA, including providing details about  installation-level real property inventories, because DOD’s real property  management process does not require coordination with GSA until the  property has been declared excess. Although coordination is not  required, if space is available but not currently in use, it would likely  benefit the installation to have a tenant use the space rather than allowing  the space to remain unutilized or underutilized for the following reasons.  As discussed earlier, DOD guidance directs the military departments to  utilize their space to the maximum extent possible consistent with military  requirements. Also, because a tenant offsets some direct and indirect  costs, such as utilities and maintenance, in a constrained budget  environment installations can keep facilities in good condition that would  otherwise be unutilized or underutilized.
Officials at the OSD, service, and installation levels told us that actively  pursuing potential tenants would be an administrative burden on the  installations, especially if there is not a significant amount of available  space on the installation. However, there are ways that DOD could  accomplish this without significantly increasing the administrative burden  on the installation. For example, DOD does not provide regional or local  contacts or information on the process for requesting space for  installations to GSA or other non-DOD federal agencies. Each installation  we visited already had an established process for evaluating requests for  space from non-DOD entities. However, installation officials at some of  the locations we visited said that non-DOD federal agencies are not  always aware of the process or the proper organization at the installation  to which requests should be submitted. For example, some agencies  route their requests to the wrong organization at the installation, which  can lead to delays in processing the request. Further, GSA officials told  us that not knowing whom to contact locally or regionally for military  installations is one factor that inhibits information sharing between GSA  and DOD, including information about non-DOD federal agencies  requesting space through GSA. Without actions to share information at  the regional and local level, GSA offices working with non-DOD federal  agencies may risk missing opportunities for clients to use available  underutilized or unused federal space at lower cost than commercial  leases. In addition, DOD may be missing opportunities to leverage  resources with GSA to enhance utilization of its unutilized and  underutilized facilities and reduce costs associated with maintaining these  facilities.
section_title: Conclusions
paragraphs: DOD and the federal government as a whole face challenges in  continuing to operate and maintain unutilized and underutilized facilities  that use valuable resources that could potentially be eliminated from the  budget or allocated to other uses. Coordinated efforts among federal  agencies, as called for in the 2015 National Strategy for Real Property,  could enhance utilization of federal real property. At this time, DOD and  GSA do not share information concerning unutilized and underutilized  space at military installations or potential clients working with GSA that  could facilitate the use of available space by non-DOD federal agencies.  Without such information sharing, DOD may be missing opportunities for  installations to maximize the use of space and reduce costs, and GSA  risks missing opportunities for some of its clients to reduce or avoid rental  costs altogether and to reduce their reliance on commercial leases.
section_title: Recommendation for Executive Action
paragraphs: We recommend that the Secretary of Defense direct the Assistant  Secretary of Defense for Energy, Installations, and Environment, in  collaboration with the Administrator of GSA, to identify and implement  actions to enable and enhance routine information sharing between DOD  and GSA about the utilization of facilities on military installations. Such  actions should include establishing recurring processes to (1) share  information about non-DOD federal agencies seeking workspace, and (2)  ensure that GSA and DOD organizations are aware of the appropriate  points of contacts within their organizations at the regional and local  levels.
section_title: Agency Comments and Our Evaluation
paragraphs: We provided a draft of this report to DOD and GSA for official review and  comment. We received written comments from both agencies.
In its comments, DOD concurred with our recommendation and stated  that it would be supportive of GSA’s efforts to share information about the  non-DOD federal agencies seeking workspace.  It would work with GSA  to ensure that GSA and DOD organizations are aware of the appropriate  points of contacts within their organizations at the regional and local level.   In its comments, GSA concurred with our recommendation and stated  that it agreed with our findings and would take actions to implement our  recommendation. It further stated considering DOD military installations  as potential housing solutions prior to going to the open market will help  ensure that government-owned assets are used to capacity. GSA also  outlined four specific actions to address our recommendation: (1)  convene a working group with DOD real property officials to understand  DOD’s national land holding portfolio and identify unutilized and  underutilized space at military installations; (2) collaborate with DOD to  establish a shared real property inventory database; (3) review GSA’s  inventory of customer agencies’ current and future needs; and (4) revise  the Federal Management Regulations to include DOD in GSA’s priorities  for housing federal agencies.
We agree that the actions outlined by DOD and GSA represent a positive  step toward ensuring that government-owned assets are used to  capacity. DOD’s and GSA’s official comments are reprinted in appendix II  and appendix III, respectively.
We are sending copies of this report to the appropriate congressional  committees; the Secretaries of Defense, the Army, the Navy, and the Air  Force; and the Administrator, General Services Administration. In  addition, the report is available at no charge on the GAO website at  http://www.gao.gov.
If you or your staff have any questions about this report, please contact  me at (202) 512-4523 or LeporeB@gao.gov. Contact points for our office  of Congressional Relations and Public Affairs may be found on the last  page of this report. GAO staff who made key contributions to this report  are listed in appendix IV.
section_title: Appendix I: Objectives, Scope, and Methodology
paragraphs: To evaluate the potential for and obstacles to federal agencies other than  Department of Defense (DOD) organizations relocating onto military  installations to save costs and enhance security, this report identifies (1)  what options, if any, are available for DOD to allow non-DOD entities,  including federal government agencies, to use unutilized (vacant) and  underutilized (partially vacant) space on military installations, and what  factors DOD considers when considering exercising each option; (2) any  limitations and benefits of bringing non-DOD federal agencies onto  installations; and (3) the extent to which DOD and other federal agencies  coordinate to do so.
To determine what options are available and factors to consider for DOD  to allow non-DOD entities, including federal government agencies, to use  unutilized and underutilized space on military installations, we reviewed  applicable DOD and military department guidance to identify the  circumstances under which non-DOD tenants are allowed to utilize space  on military installations, the order of priority for considering non-DOD  tenants for use of space, the types of real estate instruments used to  grant non-DOD entities use of space on military installations, and the  documents used to record the terms and conditions associated with the  use of space on military installations. In addition, we interviewed  responsible officials within the Office of the Secretary of Defense (OSD)  and the military department headquarters to determine their roles in  bringing non-DOD tenants onto military installations and identify the  factors that are considered when determining whether to grant a non- DOD entity use of space on a military installation. Finally, we selected  seven installations to visit to identify what non-DOD entities are present  on installations, the process the installations used to determine whether  to grant non-DOD entities access to space on the installations, and the  factors that installations considered when determining whether to grant   While our observations from these  non-DOD entities access to space.installations are not generalizable, the observations do provide context  concerning non-DOD entities using space on military installations. The  primary factor we considered in selecting the installations we visited was  the number of real property assets that were identified as being used by  non-DOD federal agencies in DOD’s Real Property Assets Database  (RPAD) at the end of fiscal year 2013. While we have previously reported  on inaccurate and incomplete utilization data in the database, we  determined that the RPAD data were sufficiently reliable for the purposes  of selecting installations to visit. The secondary factor that we considered,  in order to respond to a consideration in the mandate, was whether the  installation supported DOD’s Arctic mission. Specifically, the National  Defense Authorization Act for Fiscal Year 2014 included a provision for  GAO to consider the potential for and obstacles to consolidation of federal  tenants on installations that support Arctic missions, focusing on federal  entities with homeland security, defense, international trade, commerce,  and other national security functions that are compatible with the missions  of military installations, or can be used to protect national interests in the  Arctic region. Using these factors, we selected the installation from each  military service that had the greatest number of real property assets  identified as being used by non-DOD federal agencies, two installations  that supported DOD’s Arctic mission, and two installations that had a  relatively small number of real property assets identified as being used by  non-DOD federal agencies. Our selected installations included
Kirtland Air Force Base, New Mexico;
Fort Bliss, Texas;
Naval Base Coronado, California;
Marine Corps Base Quantico, Virginia;  Joint Base Elmendorf-Richardson, Alaska (Arctic mission);
Eielson Air Force Base, Alaska (Arctic mission and few non-DOD  federal agencies); and
Marine Corps Base Camp Pendleton, California (few non-DOD federal  agencies).
To identify the limitations and benefits of bringing non-DOD federal  agencies onto installations, we reviewed applicable DOD and military  department guidance, including regulations and instructions, to determine  whether any procedures are identified for promoting the use of unutilized  or underutilized space by non-DOD federal agencies and whether any  limitations and benefits are identified. In addition, we interviewed  responsible OSD, military department headquarters, and installation  officials to obtain their perspectives concerning the process by which non- DOD entities are provided space on DOD installations as well as the  limitations and benefits that exist to allowing non-DOD federal agencies to  use space on military installations.
To determine the extent to which DOD and other federal agencies  coordinate to better use unutilized and underutilized space on military  installations, we reviewed General Services Administration (GSA)  guidance on its process to seek and assign space to its clients and  interviewed cognizant GSA officials concerning that process, to determine  whether it includes coordination with landholding agencies such as DOD.  We also interviewed responsible OSD, military department headquarters,  and installation officials to obtain their perspectives on coordination  between DOD and GSA. We compared that information with criteria on  practices to enhance collaboration among federal agencies that we  identified previously.
We conducted this performance audit from March 2014 to June 2015 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 provides a reasonable basis for our findings and  conclusions based on our audit objectives.
section_title: Appendix II: Comments from the Department of Defense
section_title: Appendix III: Comments from the General Services Administration
section_title: Appendix IV: GAO Contact and Staff Acknowledgments
subsections: section_title: GAO Contact
section_title: Staff Acknowledgments
paragraphs: In addition to the contact named above, Gina Hoffman, Assistant Director;  Alberto Leff; Kelly Liptan; Tamiya Lunsford; Michael Silver; Erik Wilkins- McKee; Michael Willems; and John Wren made key contributions to this  report.
section_title: Related GAO Products
paragraphs: High Risk: 2015 Update. GAO-15-290. Washington, D.C.: February 11,  2015.
Defense Infrastructure: DOD Needs to Improve Its Efforts to Identify  Unutilized and Underutilized Facilities. GAO-14-538. Washington, D.C.:  September 8, 2014.
Federal Real Property: Better Guidance and More Reliable Data Needed  to Improve Management. GAO-14-757T. Washington, D.C.: July 29, 2014  Defense Infrastructure: DOD’s Excess Capacity Estimating Methods  Have Limitations. GAO-13-535. Washington, D.C.: June 20, 2013.
Federal Real Property: Excess and Underutilized Property Is an Ongoing  Challenge. GAO-13-573T. Washington, D.C.: April 25, 2013.
High-Risk Series: An Update. GAO-13-283. Washington, D.C.: February  14, 2013.
Federal Real Property: Improved Data and a National Strategy Needed to  Better Manage Excess and Underutilized Property. GAO-12-958T.  Washington, D.C.: August 6, 2012.
Federal Real Property: Strategic Partnerships and Local Coordination  Could Help Agencies Better Utilize Space. GAO-12-779. Washington,  D.C.: July 25, 2012.
Federal Real Property: National Strategy and Better Data Needed to  Improve Management of Excess and Underutilized Property.  GAO-12-645. Washington, D.C.: June 20, 2012.
Excess Facilities: DOD Needs More Complete Information and a Strategy  to Guide Its Future Disposal Efforts. GAO-11-814. Washington, D.C.:  September 19, 2011.
Defense Infrastructure: The Enhanced Use Lease Program Requires  Management Attention. GAO-11-574. Washington, D.C.: June 30, 2011.