Real Estate From Sea To Shining Sea

One of the great amorphous contracting issues facing our federal government is how to handle real estate.

Everybody knows the U.S. is one of the greatest landlords in human history. But no one -- and I mean no one -- really knew until a few years ago just what that meant. Then came Executive Order 13327.

With the president's signature in 2004 came a mandate to collect a staggering number of details about government assets. What follows are some of those details, which I like because they sometimes involve very, very big numbers. The information comes from a report by the Federal Real Property Council at the General Services Administration.

To wit:

Federal agencies submitted information about 1.2 million assets "with a replacement value of more than $1.5 trillion." For kicks, I'll repeat: $1.5 trillion.

That includes almost 506,000 "building assets," involving 3.9 billion square feet of floor space. It also includes 57 million acres of land.

The Army has the greatest number of assets at about 265,000. The Department of the Interior is not too far behind with 184,000 assets.

As cool as these big numbers are, they're only the begining of the government's quest to understand what it owns and manages. I find myself a little concerned that the government didn't have the means for a comprehensive view of its own assets until recently.

I wonder if all these square feet of office space, acres of land and all the rest are being managed as well as taxpayers would like?


By Robert O'Harrow |  July 27, 2007; 6:12 AM ET real estate
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You're only seeing the tip of the iceberg on the problem of federal real property.

OMB was asked by Congress in June to come up with a report of the top 100 federal properties eligible for disposal. Their report, which included 130 properties, was a jaw-dropper for Congress. Senator Tom Coburn (R-OK) called it "obscene" that the federal government could be hanging on to real property worth more than the gross domestic product of Afghanistan.

Don't be misled that the government has gotten its act together with regards to real property. It hasn't. Federal real property has been on the GAO's high-risk list of areas susceptible to waste, fraud and abuse since 2003 - mostly because of problems with data quality and validity.

When you compare real property reports from this year and last year, some things are hard to reconcile - why is it that now, when federal real property is under scrutiny, there is greater inventory reported that in the past? Why is the US Postal Service inventory off by eleven hundred percent from previous years?

Of course, part of the answer is that now that there is greater scrutiny by Congress, people are being more careful about accurately reporting their real property. But that, in fact, casts doubt on the validity of the current report. It's likely to take several cycles of reporting before the federal inventory reflects reality. In the meantime, it's high irony indeed that OMB is creating reports on surplus property based on data that's been found to be faulty and unreliable.

Thanks to reporting like yours, and the watchful eye of groups like Citizens Against Government Waste (http://www.cagw.org/site/PageServer?pagename=news_wastewatcher
), this issue is finally getting some much-needed attention. Legislation is pending on both the Senate (S.1667) and House (HR3049) sides of Congress to make it easier and more attractive for agencies to get rid of surplus property. Until now, accuracy in the inventory was an unbudgeted inconvenience for most agencies - they received no additional budget to do the work, and no benefit from selling off the surplus. In fact, the only thing driving them was the vague threat from non-compliance with an Executive Order and the President's Management Agenda. Let's hope this proposed legislation changes things for the better.

It's about time. Could you imagine if taxpayers tried to get away with the same vague information about their property? When preparing your taxes, if your accountant asked you how much property you owned, and how much of it was used for business, imagine how the government would react to an answer like, "I'm not sure, really. I can take a guess." Shouldn't the government be held to similar standards as taxpayers?

Again, this latest report on real property actually raises more questions than it answers. Accountability will be key for the future - a future that's still years away.

Posted by: Alex | July 27, 2007 9:01 AM

As someone who watched counties do this, there are many reasons for keeping real estate for future use. Countless reasons. We have seen counties sell property and then have to rent the same property back at a net loss to the taxpayers but considerable gain to a developer.

Ditto with a "total US Government real property report." Of what real value is it to learn all the different property owned by multiple agencies. Is it useful to know that the National Park Service has acres of parkland and some little agency has an office building in Ohio? Doesn't it make more sense to keep this together by agency? I think the answer is that it does and this little exercise was a waste of tax money. Why does Alex's post sound so well-informed it would have to be astroturf? Not saying it is, just that it sounds like it.

Posted by: DCer | July 27, 2007 1:34 PM

The "amount" of federal real property is a meaningless number. That is, is it too much, or possible TOO LITTLE (for example, if the government is renting properties where it would be more cost effective to own)? Who judges how much is too much, or too little property? What use it is to know this abstract number?

Rather than coming up with some overall number, it seems best to have the numbers organized, so they become more meaningful. Presumambly, they should be organized by agency, with explanations and/or justifications.

It seems like this is nothing more than a way to try to shock the public by saying the government owns so many trillion dollars worth of land. (Presumambly, this means lots of the land should be sold off.) Of course, that doesn't follow logically, but everyone will pretend like it does.

For example, the above poster says "Senator Tom Coburn (R-OK) called it 'obscene' that the federal government could be hanging on to real property worth more than the gross domestic product of Afghanistan." Ummm, there is nothing inherently obscene about that at all.

Posted by: philmonomer | August 1, 2007 8:24 AM

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