The federal real property environment has many stakeholders and involves a vast and diverse portfolio of assets that are used for a wide variety of missions. Real property is generally defined as facilities, land, and anything constructed on or attached to land. According to FRPP data, the federal government owned and leased 1.2 million assets with a replacement value of $1.5 trillion in fiscal year 2006. The Department of Defense, USPS, GSA, and the Department of Veterans Affairs hold the majority of the owned and leased facility space. The makeup of the federal government’s facilities reflects the diversity of agencies’ missions and includes office buildings, prisons, post offices, courthouses, laboratories, and border stations. GSA is authorized by law to acquire, manage, utilize, and dispose of real property for most federal agencies. These authorities are contained in title 40 of the U.S. Code, and GSA is responsible for its implementation. Agencies are subject to title 40 authorities unless they have their own specific real estate authority and are exempted from title 40. Under title 40, GSA is authorized to enter into lease agreements for up to 20 years that the Administrator of GSA considers to be in the interest of the federal government and necessary to accommodate a federal agency. GSA uses this authority to lease space on behalf of many federal government agencies. In 1996, GSA began a program called “Can’t Beat GSA Leasing” that offered federal agencies the choice of using GSA as their leasing agent or assuming responsibility for their own leasing. Under this program, GSA delegated leasing authority for general purpose space to the heads of all federal agencies. GSA’s original delegation consisted of six conditions, which included the requirements that federal agencies acquire and utilize leased space in accordance with all applicable laws and regulations. In December of 2002, GSA revised its regulations to specifically state that all agencies must follow the budget scorekeeping guidelines and OMB’s requirements for leases, capital leases, and lease purchases identified in appendixes A and B of OMB Circular A-11. Federal agencies also may have their own independent statutory authority related to real property. In November 2007, GSA amended its delegations of leasing authority to acquire general purpose office space and special purpose office space. GSA said its basis for amending these delegations of authority was to increase oversight and to facilitate compliance with all applicable laws and regulations governing the acquisition of real property, since several recent audits of its delegation program found instances in which agencies had failed to meet the requirements of their leasing delegation. USPS, which is an independent establishment in the executive branch, is authorized to sell, lease, or dispose of property under its general powers and is exempt from most federal laws dealing with real property and contracting. Since 2003, we have reported that federal real property is a high-risk area due to excess and deteriorating property, reliance on costly leasing, unreliable data, and security challenges. Specifically, problems are exacerbated by underlying obstacles that include competing stakeholder interests, legal and budgetary limitations, and the need for improved capital planning. For example, agencies cited local interests as barriers to disposing of excess property, and agencies’ limited ability to pursue ownership leads them to lease property that may be more cost-effective to own over time. In February of 2004, the President signed Executive Order 13327 and added real property management to the President’s Management Agenda, which scores agencies on their progress in meeting performance targets. The order applies to 24 executive branch departments and agencies, but not to USPS. Agencies under that executive order have, among other things, designated senior real property officers, established asset management plans, standardized real property data reporting, and adopted various performance measures to track progress. The administration’s establishment of FRPC also supports reform efforts. Furthermore, OMB staff said that the administration intends to work with Congress to provide agencies with tools to more effectively manage their real property assets. To meet the order’s requirement for standardized real property data reporting, FRPC worked with GSA to develop FRPP. The first governmentwide reporting of inventory data for FRPP took place in December of 2005, and selected data were included in the fiscal year 2005 Federal Real Property Report, published by GSA on behalf of FRPC in June of 2006. In our April 2007 update on real property high-risk issues, we reported that the administration and major real-property-holding agencies had made progress toward strategically managing federal real property and addressing some long-standing problems. Federal agencies rely extensively on leasing, occupying about 398 million square feet of leased building space domestically in fiscal year 2006, according to data from FRPP. According to fiscal year 2006 FRPP information, GSA and USPS hold the majority of the federal government’s leased building space, totaling about 270 million square feet, or about 67 percent of the leased inventory of space within the United States and U.S. territories. Agriculture holds 4 percent of leased space. In fiscal year 2006, GSA, which acts as a leasing agent for other agencies, had 6,750 leases and provided slightly less than 169 million square feet of leased building space to nearly every department within the federal government. Table 1 shows the amount of domestically leased space by agency, according to FRPP. According to FRPP data, over half of the space, in terms of square footage, is office space, with a mix of other uses including warehouses, family housing, and schools. The single largest category of federally leased space—office-related purposes—accounts for approximately 201 million square feet, or 51 percent of all domestic leased building space. This category includes office space and military headquarters space. The second largest category of leased space, “all other,” includes space for post offices and laboratories, as well as other buildings that cannot be classified in other categories. About 104 million square feet of leased space were reported in this category. In addition, agencies reported leasing about 29 million square feet of building space for warehouses and about 22 million square feet for family housing—a category that includes, among other things, public housing and military personnel housing. Figure 1 shows domestic leased square footage by predominant usage. As the federal agency that leases the most space, GSA leases space for a variety of purposes, but about 152 million square feet, or 90 percent of its leased portfolio, is leased exclusively for offices. GSA also leases about 15 million square feet, or about 9 percent of its overall leased portfolio, for warehouses for agencies. Additionally, GSA leases building space for such purposes as laboratories, family housing, and other miscellaneous uses. These uses account for about 1 percent of its leased space. Agriculture had more than 3,700 leases totaling nearly 17 million square feet of building space in fiscal year 2006. About 92 percent of Agriculture’s leased space, or slightly more than 15 million square feet, is for offices. Agriculture also has a little over a million square feet leased under the all other, warehouse, and service categories. According to FRPP data, USPS has roughly 28,100 leases, which are categorized as all other. According to OMB staff, because of a USPS data-coding error, the square footage for USPS assets was included in the “all other” category and accounts for about 95 percent of the square footage reported for this category. USPS told us that the majority of its leased buildings are used primarily for customer service post offices, and a portion of its building space is used for retail facilities and carrier annexes. We did not develop data on the overall yearly cost of leased space to the federal government. OMB staff said that variation in costs included in lease payments among agencies would create data consistency problems. As an indicator of asset value, FRPP tracks replacement value—or the cost to replace leased space with owned space—and the estimated replacement value of the federal government’s existing domestic leases totals $48 billion. In April of 2007, we reported that although agencies have made progress in collecting and reporting standardized real property data for FRPP, data reliability is still a challenge at some of the agencies, and agencies lack a standard framework for data validation. For this review, we assessed the fiscal year 2006 FRPP leasing data and found them to be generally reliable for the purpose of profiling the leased inventory. However, we noted some data quality issues that would be cause for concern if FRPP were used for more than describing the inventory, such as strategic decision making. For example, USPS categorized its 28,108 leased assets “mission dependent not critical” and did not include annual operating costs for each leased asset. The categorization of USPS’s leased facilities as “mission dependent not critical” and “not mission critical” could be questioned, since USPS’s facilities serve as the main channel for providing mail delivery service to all people residing in the United States. In our April 2007 report, we recommended that OMB develop a framework that agencies can use to better ensure the validity and usefulness of key real property data in FRPP. OMB concurred with this recommendation and has required agency-specific validation and verification plans and, according to OMB officials, has developed an FRPP validation protocol to certify agency data. According to OMB staff, each score card agency has developed and implemented an agency-specific data validation and verification plan. FRPP is a relatively new inventory, a result of implementing Executive Order 13327, and therefore governmentwide data on leasing trends were not available. However, GSA, whose tenants represent a cross-section of federal agencies, maintains historical data that are useful in examining trends. The most striking trend in GSA-leased space, GSA predicts, is that for the first time it will lease more space than it owns in 2008.