However, after it had closed its fiscal year 1997 books, PBS reported the actual budget impact of its overestimation to be $634.4 million for fiscal years 1996 and 1997, and reduced its fiscal year 1998 overestimation to $28.3 million. Weaknesses in PBS’ Revenue Forecasting Process

As indicated, in January 1997, GSA informed Congress that it expected its total overestimate of rental revenue for fiscal years 1996 and 1997 to be $847 million. PBS provided documentation supporting the amount of the overestimation for six of the seven reasons. Additional problems with PBS’ rental revenue estimation process have also been identified. GSA’s Efforts to Improve Its Revenue Projection Process

official, PBS will issue a directive on documenting the rental estimating process by April 1998. The fiscal year 1995 rental revenue estimate was generally higher than actual fiscal year 1995 revenues. The first copy of each GAO report and testimony is free.
Why GAO Did This Study

Pursuant to a congressional request, GAO discussed the General Services Administration's (GSA) overestimation of its rental revenue projects for the Federal Buildings Fund (FBF) in fiscal years (FY) 1996, 1997, and 1998, and the actions it is taking to improve its future revenue projections.

What GAO Found

GAO noted that: (1) GSA had documentation supporting the dollar amounts it attributed to six of the seven reasons it reported for the overestimation of rental revenue; (2) in addition, GAO and others identified several weaknesses in GSA's rental revenue estimation process; (3) GSA was aware of these problems and has taken corrective actions which GAO believes, if effectively implemented, should help improve future rental revenue estimates; and (4) further, GSA recently reported the actual budget impact of its rental revenue overestimation to be $634.4 million for FY 1996 and FY 1997, and reduced its FY anticipated overestimation substantially.