1.) The Government Has Adopted a More Strategic Focus to Improve Real Property Management and Has Taken Steps to Increase Data Reliability

The administration and real-property-holding agencies have made progress  in a number of areas since we designated federal real property as high risk  in 2003. In 2003, we reported that despite the magnitude and complexity of  real-property-related problems, there had been no governmentwide  strategic focus on real property issues. Consequently, we removed the data element of  real property management from our high-risk list this year. CPRA Could Help Agencies Address Underlying Challenges to Disposing of Unneeded Property

The government now has a more strategic focus on real property issues  and more reliable real property data, but problems related to unneeded  property and leasing persist because the government has not addressed  underlying legal and financial limitations and stakeholder influences. The costs of disposing of federal property further hamper some agencies’  efforts to address their excess and underutilized real property problems. In 2007, we recommended that OMB, which is responsible for reviewing  agencies’ progress on federal real property management, assist agencies  by developing an action plan to address the key problems associated with  decisions related to unneeded real property, including stakeholder  influences. The administration’s  recently proposed legislative framework, CPRA, is somewhat responsive  to our recommendation in that it addresses legal and financial limitations,  as well as stakeholder influences in real property decision making. With the goal of streamlining the disposal process, CPRA provides for an  independent board to determine which properties it considers would be  the most appropriate for public benefit uses. This streamlined process  could reduce both the time it takes for the government to dispose of  property and the amount the government pays to maintain property. To provide financial assistance to the agencies, CPRA establishes an Asset  Proceeds and Space Management Fund from which funds could be  transferred to reimburse an agency for necessary costs associated with  disposing of property. To address stakeholder influences, the independent board established  under CPRA would, among other things, recommend federal properties for  disposal or consolidation after receiving recommendations from civilian  landholding agencies and would independently review the agencies’  recommendations. CPRA does not explicitly address the government’s overreliance on  leasing. Our current work  examines the efficiency of the federal government’s real property lease  management in more detail. Certain key elements of DOD’s process for  closing and realigning its installations may be applicable to the  realignment of real property governmentwide. Some of these key elements  include establishing goals, developing criteria for evaluating closures and  realignments, developing a structural plan for applying selection criteria,  estimating the costs and savings anticipated from implementing  recommendations, establishing a structured process for obtaining and  analyzing data, and involving the audit community. Key Elements That DOD Used to Develop Its 2005 BRAC Recommendations That Could Benefit a Civilian Real Property Closure or Realignment Process

In developing its recommendations for the BRAC Commission, DOD relied  on certain elements in its process that Congress may wish to consider as it  evaluates the administration’s proposed legislation for disposing of or  realigning civilian real property, as follows:  Establish goals for the process. Estimate costs and savings to implement closure and realignment  recommendations. Another important similarity is that both the BRAC and proposed  CPRA processes call for an independent board or commission to review  recommendations. A key difference between BRAC and the administration’s proposed CPRA  is that while the BRAC process placed the Secretary of Defense in a  central role to review and submit candidate recommendations to the  independent board, CPRA does not provide for any similar central role for  civilian agencies.
Why GAO Did This Study

The federal government holds more than 45,000 underutilized properties that cost nearly $1.7 billion annually to operate, yet significant obstacles impede efforts to close, consolidate, or find other uses for these properties. GAO has designated federal real property management as a high-risk area, in part because of the number and cost of these properties. The Office of Management and Budget (OMB) is responsible for reviewing federal agencies' progress in real property management. In 2007, GAO recommended that OMB assist agencies by developing an action plan to address key obstacles associated with decisions related to unneeded real property, including stakeholder influences. In May 2011, the administration proposed legislation, referred to as the Civilian Property Realignment Act (CPRA), to, among other things, establish a legislative framework for disposing of and consolidating civilian real property and that could help limit stakeholder influences in real property decision making. This statement identifies (1) progress the government has made toward addressing obstacles to federal real property management, (2) some of the challenges that remain and how CPRA may be responsive to those challenges, and (3) key elements of the Department of Defense's (DOD) base realignment and closure (BRAC) process that could expedite the disposal of unneeded civilian properties. To do this work, GAO relied on its prior work, and reviewed CPRA and other relevant reports.

What GAO Found

In designating federal real property management as a high-risk area, GAO reported that despite the magnitude and complexity of real-property-related problems, there was no governmentwide strategic focus on real property issues and governmentwide data were unreliable and outdated. The administration and real-property-holding agencies have subsequently improved their strategic management of real property by establishing an interagency Federal Real Property Council designed to enhance real property planning processes and implementing controls to improve the reliability of federal real property data. Even with this progress, problems related to unneeded property and leasing persist because the government has not yet addressed other challenges to effective real property management, such as legal and financial limitations and stakeholder influences. CPRA is somewhat responsive to these challenges. 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. CPRA would also establish an Asset Proceeds and Space Management Fund that could be used to reimburse agencies for necessary disposal costs. The proposed independent board would address stakeholder influences by recommending federal properties for disposal or consolidation after receiving recommendations from civilian landholding agencies and independently reviewing the agencies' recommendations. CPRA does not explicitly address the government's overreliance on leasing, but could help do so through board recommendations for consolidating operations where appropriate. GAO is currently examining issues related to leasing costs and excess property. Certain key elements of DOD's BRAC process--which, like CPRA, was designed to address obstacles to closures or realignments--may be applicable to the disposal and realignment of real property governmentwide. These elements include establishing goals, developing criteria for evaluating closures and realignments, estimating the costs and savings anticipated from implementing recommendations, and involving the audit community. A key similarity between BRAC and CPRA is that both establish an independent board to review agency recommendations. A key difference is that while the BRAC process places the Secretary of Defense in a central role to review and submit candidate recommendations to the independent board, CPRA does not provide for any similar central role for civilian agencies.