▶ 0:05:15Kick it on. Welcome everyone here today at Subcommittee on Financial Services and General Government will come to order. This hearing is titled GAO's assessment of the costs of deferred maintenance across the federal government. Members will have 5 legislative days within which to revise and extend their remarks and insert extraneous materials into the I now recognize the Government Accountability Office, also known as GAO, said it best when they described the federal government as quote one of the world's largest and most complex entities, end quote.
▶ 0:05:44I said for years that we do a lot of talking in DC about how much we owe, and rightfully so, with the national debt continuing to climb, but we do not talk a good do a good job of talking about what we own. The US government needs a clear balance sheet to fully understand both our costs and our assets, and I'm hopeful that GAO can assist in that process.
▶ 0:06:03To help Congress and the executive branch manage the federal government's operations, GAO created a high-risk This list, which is updated every 2 years, identifies areas that are ripe for waste, fraud, and abuse, and mismanagement, or areas that need to be fundamentally overhauled. Disturbingly, the maintenance of federal properties went on this list in 2003 and has not come off in 22 years. The issue of deferred maintenance plays heavily into this problem. The federal real estate portfolio is significant.
▶ 0:06:31There are more than 285,000 buildings and structures with a replacement value of over 1.2 trillion. Over the last several years, the deferred maintenance in the federal real property portfolio has ballooned. For example, in FY2020, GA GSA's deferred maintenance and repair costs were 2.53 In FY2024, GSA's estimated deferred maintenance and repair costs increased to 6.1 billion. The GSA is not unique in this.
▶ 0:07:00The National Archives and Records Administration, or NARA, owns and maintains real property assets including uh independent assets independently of GSA. NARA's financial uh 24 financial suggests that it also has significant deferred maintenance In testimony before Congress, Postmaster General uh DeJoy stated in 2020 when he took office, the US Postal Service has 31,000 facilities in horrible condition with more than 20 billion dollars in deferred maintenance liabilities.
▶ 0:07:30As we look at the causes of deferred maintenance liabilities, they're not just uh about funding. Inflation and the cost of building and repair supplies can increase the overall costs. Building age is another factor. The median age for buildings within GSA's portfolio is 51 years. As the assets age, they typically require more maintenance and repair. For example, by the time the asset reaches 30 years, it may require replacement of windows, wiring, pipes, and air conditioning units.
▶ 0:07:55We need to understand this problem and we think carefully about ways in which we can address this issue in a cost-effective manner in both the short and long term. This includes ensuring that agencies are taking care of the properties under their control. Proper oversight of maintenance contractors and ensuring they keep up with the basic maintenance of their properties in their possession can ensure that small problems do not become big problems. Finally, as we think about solutions, we need to be forward-leaning.
▶ 0:08:20While selling properties is a great way to decrease the deferred maintenance backlog, we need to keep cost reduction and mission requirements at the center of these decisions. We should ensure that the federal government properly analyzes the cost of its real property and decisions and make its choices to dispose, replace, or repair properties in ways that reduce long-term costs while ensuring that federal agencies retain the facilities and resources required to conduct their missions effectively. I look forward to our discussion today. I now recognize Mr.
▶ 0:08:48Pocan, who's serving as ranking member today for his opening statement. Uh thank you thank you, Mr. Chairman, and uh wrong one. I'm going to switch it over here. All right, how you doing? Um I just want to thank Mr. Moroney for testifying today on deferred maintenance across the federal government. I look forward to hearing your thoughts on how the federal government can address these issues. Unfortunately, I do not think this is a discussion on deferred building maintenance is the most relevant topic for one of this subcommittee's first public hearings of the year.
▶ 0:09:18I recently hosted several town halls throughout my district and heard from people across Wisconsin. In each of these town halls, my constituents raised serious objections to what the Trump-Musk administration is doing. I'm not sure how many of my colleagues in this the majority have held their uh own in-person town halls, but the message at each has been very clear. People are rightfully worried about an administration that is causing chaos both at home and abroad. They're worried about an administration that is run by and for billionaires, not working families.
▶ 0:09:45We have corruption when the richest man in the world, Elon Musk, is in charge of cutting federal agencies and services and then receiving another 6 billion dollars in federal contracts on top of over 20 billion he's already Without any idea of what they're doing. DOE has canceled numerous grants, contracts, and awards negatively affecting all of our constituents. They have directed the mass firings of federal employees, often later realizing they shouldn't have.
▶ 0:10:09Doesn't inspire confidence in their work when we are firing the people who secure our nuclear weapons or the scientists who are working to combat avian flu. Every uh even now uh HHS has to bring back 20% of the people mistakenly laid off last week, all uh a part of DOE's gross April Fools' Day hirings firings. are seeing this administration, the Republicans in Congress, roll back policies meant to cut costs and protect consumers.
▶ 0:10:36Just this week, we're voting to undo a rule that saves Americans up to $5 billion a year in excessive bank overdraft fees. So, who exactly are we trying to help? This week, the majority is also attempting to take step uh forward to advance a budget resolution process that will cut hundreds of billions of dollars from Medicaid, SNAP, and public education. The House has a stated goal of cutting a minimum of million and a half a trillion and a half dollars. And for what? To give the wealthiest another four and a half trillion dollars in tax cuts.
▶ 0:11:06But, let's focus on the work of the subcommittee. At this chaotic moment, our subcommittee has an exceptionally relevant jurisdiction. I already talked about DOE quite a bit, but that is housed under the Executive Office of the President, which we fund. We can and should have a hearing with Musk and others at DOE to hear directly about what they're doing and what authority they believe they have to inflict so much destruction on the federal government. We should have a public hearing with the director of the Office of Management and Budget. We routinely have the former OMB director testify.
▶ 0:11:34I can't imagine any reason why we would not want to treat this administration differently. Will we hear from them before uh we mark up our appropriation bills? He's happily played a big role in the chaos we're all witnessing. Will we have the Small Business Administration in a public hearing? I'm trying to square exactly how firing nearly half of the agency dedicated to supporting small businesses is helping the economy. Also, I hear they're going to be responsible for administering 1.6 trillion in student loans. I expect that the subcommittee would be interested in learning more about that.
▶ 0:12:02Will we have OPM testify publicly about their role in the massive layoffs across the government? How are those decisions being made? What about the IRS? Where there are plans to cut a quarter of the workforce there. Who stands to benefit from that? How much will that add to the deficit? And what about the removal of two of the FTC's independent commissioners? Just a couple of years ago, the majority was really interested in federal employee morale at the FTC. Not sure if anyone here remembers how much time was spent on that.
▶ 0:12:32I could go on and on, but I think I've made my point. I I do thank you, Mr. Maroney, for being here today, but given the jurisdiction of the subcommittee and the unprecedented dismantling of the federal government we're witnessing in real time, building maintenance is not at all what should be discussed today. Uh with that, I yield Uh thank you, Mr. Pocan. Today, we welcome the testimony of Mr. David Maroney, director of physical infrastructure at the United States Government Accountability Office. Mr. Maroney, without objection, your full written testimony will be entered into the record.
▶ 0:13:02With that in mind, we would ask you to please summarize your opening statement in 5 minutes. Thank you, Chairman. Representative Pocan and members of the subcommittee, I'm pleased to be here today to discuss the large and growing backlog of deferred maintenance in the federal government. For more than 20 years, GAO has identified the management of federal property as a high-risk area in need of substantial transformation.
▶ 0:13:26And this year, we added building condition as a new high-risk topic due to large increases in the cost of addressing deferred maintenance in federal buildings. In fact, the federal government's deferred maintenance backlog has now more than doubled to a a total of $370 GSA's own backlog has quadrupled to more than 6 billion. So, that asks the question, why has the backlog grown so much in recent years? And there are a number of reasons. Uh one is the size and increasing age of these buildings.
▶ 0:13:55As was already noted, the the average age is about 50 years or more. Costs more to take care of older space. There's also rising labor and material costs, so inflation. And then, there have been funding constraints over time that have led agencies to put off planned maintenance and repairs. Unless this overall trend of an increase in deferred maintenance reverses, federal assets will continue to deteriorate, potentially impacting agency missions. Buildings will also become more expensive to fix than if they were maintained on schedule.
▶ 0:14:23It just takes more money if you leave things to get So, what can be done about this? At the tactical level in the near term, agencies can better apply leading practices for managing deferred They can follow risk-based approach to prioritize must-haves versus nice-to-haves. And they can make a better business case to Congress uh for investing limited taxpayer dollars in critical maintenance and repairs.
▶ 0:14:46At a more strategic level, agencies can in the near term get rid of buildings that are already known to be underused, not needed, and in poor condition. Those are low-hanging fruit. They should go ahead and proceed in that direction. Then, as agencies start measuring utilization of all their buildings for the first time this summer, they can identify which spaces are most underused, compare that to the condition of the building, and what makes sense is then to reconfigure and consolidate into buildings that are in good condition, and plan to dispose of the buildings that are in poor
▶ 0:15:16condition and underused. That will help address two issues at the same time that have been long-standing challenges for federal property. One, large-scale underuse, which has a high operations and maintenance cost to the government. And second, significantly reducing the federal government's deferred main- maintenance liabilities at the same That concludes my opening statement. Happy to take any questions. Thank you very much for the brevity of your opening statement.
▶ 0:15:43And uh uh we'll I'll now recognize myself for Mr. Maroney, the size of the federal real estate portfolio is obviously very significant. This uh federal civilian agencies own more than 285,000 buildings and structures. These assets are held by the federal government that have been outsized deferred maintenance and repair issues that represent real costs to the federal government and to our taxpayers.
▶ 0:16:07For example, GSA data shows that 25 buildings with the highest deferred maintenance has an estimated uh 8.6 billion in capital liabilities. Could you tell us what about deferred maintenance is and why this committee should care about the issue? So, deferred maintenance is a pretty broad definition. It's anything that has reached the end of its planned life. So, that could be anything from paint on the walls to your HVAC system not working. So, it's a a wide range, and I think that's important context. All the numbers we're talking about today includes both of those items.
▶ 0:16:35So, some things that are absolutely you need to fix it if you're going to keep using this building, and some components where it's yeah, it's probably okay to defer it. It's actually probably reasonable to defer some of those costs for a time. Uh the things that really need to be focused though on, and agencies need to prioritize and communicate this well to Congress, are these are the systems that if we don't address, are going to be very expensive to fix, are going to impact the use of these buildings, and potentially affect mission. Uh the rest can be addressed as needed, and potentially should not be addressed.
▶ 0:17:04If you're going to renovate a building, if you're going to get disposed of building, it makes no sense to invest money in that building. You need to focus on the ones that are high We maintain a high-risk list of which identifies areas are most troublesome for Congress. Why is maintenance of federal properties considered a high-risk issue? Because it affects the condition of the building. It affects the ability to use that mission to accomplish to use that building to accomplish the mission of the agency. What role does deferred maintenance play with respect to the issue with federal property maintenance?
▶ 0:17:35So, it's uh directly tied. If you don't keep up federal ongoing maintenance, things break, things get more expensive to replace. And so, that's what ends up being deferred maintenance. If you don't do planned maintenance when you're supposed to, then it becomes deferred, and then over time, it gets more expensive to fix. And that's what lands them on the high-risk list. That's what ends up building condition on the high-risk list is this large backlog of deferred maintenance. Yes. Does that mean they're uninhabitable? No. Uh in most cases, it's not going to mean they're uninhabitable. It's going to be a range of issues.
▶ 0:18:04So, you could have a situation where a building can't fulfill its purpose, uh but in most cases, it's going to be this is going to be challenging. Maybe the HVAC system isn't working correctly. Maybe the elevator banks are down and are hard to replace. Uh it could range in anything from very minor to more significant impacts on your use of that Thank you very much. Now, recognize Mr. Pocan for any questions he may have. Sure. Thank you, Mr. Chairman, and uh Director Maroney. It seems that uh GSA, perhaps influenced by DOE, is taking the lead on deciding what space should be eliminated.
▶ 0:18:35Um who seems to be running the show? Is it GSA, the agencies, or DOE? And how has DOE interacted with GAO? Uh have they met with our experts on how to most effectively address these issues? So, in terms of the announcements of uh both on property disposals and lease reductions, uh GSA appears to be taking the lead on that, uh although they have said they are coordinating with agencies. Uh but GSA has been taking the lead on these announcements. Uh in terms of DOE, we have not interacted directly with them.
▶ 0:19:05And who should be leading this effort in your opinion? Uh so, there's multiple players that have a role. Uh GSA certainly has a role uh as not only for the properties it controls, but with its expertise in this area to help agencies plan for what they need. Agencies have a role, too. They they're the ones who are most knowledgeable about what their mission needs are for facility space. OMB has a role to help guide the overall process across the government. Great. Thank you.
▶ 0:19:28Um GSA also has a new public buildings commissioner who I believe, on his fourth day on the job, said it's clear that the footprint of non-defense federal building space should be reduced by at least 50%. I know he had 4 days on the job, and it may appear to be a knee-jerk decision without doing any real analysis, um but I I'm wondering if it seems like any organization who'd want to get a clear headcount of how many people will be in that office or the impacts of those decisions prior to just shutting down buildings and the impacts
▶ 0:19:59that you're going to have to deal with. Are you familiar with any data that leads you to determine that a 50% reduction is the right number? Not yet. Not that there's utilization data that's coming this summer under the USA act which passed this January. That'll give a much better sense of how these buildings are utilized, but I'm not aware of specific data yet. Okay. And do you know if in this analysis the number of employees, the head count is part of that? I have not seen GSA's analysis. There are a bunch of moving parts that you would want to consider.
▶ 0:20:27RIFs, RTO, return to office, as well as utilization data. That being said, there are reasonable steps you can take now. There are buildings that have already been identified for disposal or that are known to be underused and in poor condition that you could move forward now and then sequence as you get better data. So, I don't want to put words in your mouth, but it sounds like you're saying this analysis this summer is really what we should all look at before we're making decisions on eliminating buildings. I would say it's an important data point.
▶ 0:20:53I think you can make some decisions now, but it's good to have the best data you can as you're making long-term decisions. Yeah. More than 4 days in the job, maybe. I won't ask you to answer that. That was rhetorical. Um just what keeps you up at night worrying about this area that we're not addressing as Congress? I think that's the I'd rather leave it open-ended to ask you. Right. So, when it comes to deferred maintenance, that So, that 370 billion dollars, it does not mean Congress should be appropriating 370 billion dollars now.
▶ 0:21:20It's more understanding what are the absolute critical needs for the buildings that we plan to keep long-term that are critical to missions and making sure that that funding is provided so that GSA or the agencies that control that buildings are able to maintain them in a condition that allows them to do their mission. At the end of the day, real estate there is to serve the mission, not vice versa. So, it's making sure that these buildings are kept up to the extent they need to be. Got you.
▶ 0:21:45And you the administration's announced its intent to downsize government, in some cases moving federal employees and agencies out of Washington D.C. and in some cases selling building assets. This would seem to require some significant planning for space consolidation and reconfiguration of the offices and buildings that the agencies will retain and occupy. Uh can GSA support these consolidation needs with half of their staff uh because I think that's where we're operating.
▶ 0:22:13And can GSA ensure the contractors meet their obligations and perform quality services with a 50% reduction in staff? So, that I don't know. What I can say is any transformation uh requires the right staff with the right capabilities in particular. So, GSA is going to have to ensure that as it reorganizes, uh which that organization reorganization should much further along this summer, uh that they have the right capabilities to execute this. And do you know does GSA have cost estimates for decentralizing the federal government with what we've started to see happen?
▶ 0:22:43Not that I'm aware of. Okay. Great. I yield back, Mr. Thank you very much. The uh chair will now recognize the distinguished Mr. Amodei for any questions he may have. Well, the distinguished one isn't here, but I'll do the best I can. Thank you, Mr. Chairman. do you folks have and I'll just set the stage for this questioning.
▶ 0:23:12Do you have a state-by-state list of like, "Hey, in this state these blah blah blah where where we've kind of when we say, "Hey, we're we're going to take a look at physical infrastructure um like Mr. Pocan was talking about." It's like do we have a baseline? And let me tell you why I'm asking the Because in my neighborhood you've got a federal building that's a courthouse.
▶ 0:23:35You've got an old post office that's being used by other agencies for something that's, you know, 50 years old and it's full of asbestos cuz that's how they built then. And then you've got leases all over western Nevada. Has anybody done an analysis to go Well, we know what kind of shape the post office is in, I assume GSA has.
▶ 0:23:59The courthouse in Reno's pretty new, so I'm assuming that's, you know, kind of But has there been any kind of analysis by either you guys or GSA to say what we're spending for another dozen agencies to be, you know, the Forest Service is over here, BLM's over there, Bureau of Rex over there, and it's all leased.
▶ 0:24:20Has anybody done an analysis to go rather than having a dozen leases floating around a 100 square or a 100-mile radius maybe if the government was really serious about efficiency and not spending money they didn't need that say, "Listen, if you had an X thousand square foot federal building that housed all these different things that might be better than paying rent to a dozen different landlords across the 100-mile radius."
▶ 0:24:51Anything like that that you're aware of? So, GSA does portfolio analysis. It does take a look at both the owned and leased properties it has under control. Now It has under what? That's under its control. Now, there's a lot more property than just what GSA has custody control over, but within its portfolio they do do that kind of analysis. Now, ultimately it's up to the agencies also. They play a role to say what this is what we need, this is what we don't. But there has been some level of analysis on what you have described.
▶ 0:25:16I will say that the data that is used in those kinds of analysis is not always the best, so it's and action is not always taken to But if I wanted to look at that, I could go to GSA and say, "Tell me what your portfolio analysis for this part of this state looks like." They should be able Certainly for their own space and for their own space looked and here's what here's what here's what it says as the last time we looked. They should be able to give you some analysis.
▶ 0:25:41It depends on the I'm not sure about the level of depth, but they should be able to give you analysis of, "Yeah, this is what's in this district, owned and leased." They do know that. They have an inventory and then they'll be able to show, "This was our analysis of leasing versus owning for these various facility needs of the agencies." Thank you. I yield back, Mr. Chairman. Thank you very much. Uh the chair now recognize Mr. Bishop for 5 minutes for any questions he may have. Thank you very much. Thank you for being here.
▶ 0:26:11What do you characterize the effect of these actions to address the backlog of deferred maintenance repairs? Would it now be harder to repair for those buildings with staffing and the budget cuts? Um if the staffing and the funds are withheld, wouldn't that make deferred maintenance even more? Well, you have to have the people to take care of the the building, so it depends if they have enough staff with the right capabilities to do that. I don't know if they do now or not, but that is a consideration.
▶ 0:26:41You need the right staff. Right. And GSA basically is the real estate agent, but you don't know what you need because we don't know how many staff we're going to have. Because all of that is is in flux. And doesn't it seem to be a little precipitous to uh to arbitrarily cut a certain amount of real estate uh certain amount of staff.
▶ 0:27:07People are just returning to work uh and from what I understand don't have places to sit because they've been working from home. So, that is definitely a challenge, especially when you're going through a large-scale transformation and the number of moving parts, return to office, reductions in force, uh new utilization data coming in. And so, that is a challenge for GSA to manage. With less staff. It is uh that is that will be a challenging thing to do. There are a lot of those moving parts, yeah.
▶ 0:27:37But it's more difficult than it would be if it were done systematically with metrics and and with transparency. Right. A level of planning can help with these transformations to have, you know, where are you trying What's your end state you're trying to get to? And how do you best get there? And so, a level of planning when you're doing a significant transformation like this is a good thing to do. And there's not been transparency in terms of where you're trying to go and how you're trying to get there. It's just been thrust upon us suddenly.
▶ 0:28:07Is that not right? So, GSA would probably best able to speak to that. I can say we know the the thrust of the administration is to reduce uh property owned and leased space. Uh I don't know their specific end goal, but they have been moving in that direction. Okay. You've been there how long? At GAO? Mhm. Uh GAO I've been there 2004, a long time. Right. But uh the position that you're in now Now, since 20 2022. Since 2022.
▶ 0:28:34And you don't have any idea what the goals are with what they want to Uh the current uh of the of the current administration, I know their goal is to reduce the number of leases, reduce federal property holdings, and reduce the number of leases the federal government is in. Did the previous administration have a plan to reduce? They did. Now, do you are you familiar with that plan? Yes. Okay. Well, talk tell us about that plan. Yes. So, that plan was also to reduce the amount of federally owned space uh over How how much?
▶ 0:29:01Um the administrator the former GSA administrator had identified potentially up to 30% uh federally owned property, but that was more of a notional goal. Uh they had been working through a portfolio analysis and had identified in December 34 properties to dispose of as an initial um initial tranche.
▶ 0:29:19So, that was roughly 30% and that was with a systematic uh The 30% was an aspirational goal by the administrator, but they were moving towards significant property uh reductions, yes. I mean, the 30% goal, was that based on some data? Yes. GSA has been doing analysis of its properties. Right. So, all of it is data. All of it up to this administration was data based.
▶ 0:29:50And I don't know what the administration has done or not on this. They may have an analysis as well. I can say in the last administration from what the work we were doing, there was analysis being done on this. Okay. I yield back. Thank you, Mr. Bishop. Uh the chair now recognizes the distinguished lady from Iowa, Ms. Hinson for 5 minutes. Thank you, Mr. Chairman. Thank you. Um and thank you, Mr. Maroney, for coming to testify today.
▶ 0:30:18Um I appreciate your your opening statement on your efforts um to help, you know, reconfigure and reconcile property. I think it is it is so crucial that we really investigate how these taxpayer dollars are being spent, identify those government inefficiencies, and make sure our dollars are going as far as they possibly can. Um I've introduced legislation to try to move some of those agencies where they make sense out of uh Washington, D.C., closer to the people um in a bipartisan manner, I might add.
▶ 0:30:45This uh clearly to your last line of questioning, um reducing um the federal government's footprint is a priority uh across the aisle, and I think that's really important in the conversations that we're having here. Um right-sizing the government's holdings will have a substantial impact for American taxpayers, and I hope that um the hearing today will help us to better understand how Congress can be a good partner there in making that happen. Um in March, obviously, we noticed the um the GSA deferred maintenance backlog exceeded 17 billion.
▶ 0:31:12Um obviously, taxpayers have to foot that bill at some point, um and one clear way is, of course, through the sale of properties. So, can you walk us through the process uh of how that happens for these agencies? You know, we we talk about the data that they have um already. Um what is the process to go through selling these properties? Um and then what is the process to make it easy for interested parties to purchase uh said properties as well from the federal Sure.
▶ 0:31:39So, there's many steps, but basically three tranches of what happens when you identify a property for disposal. First, the agency that has the property says, "We don't need it. It's excess." And then GSA in that first step will check with all the other federal agencies and see, "Does anyone else want to take this on?" So, kind of a first right of refusal within the federal government. Okay.
▶ 0:32:01Second round, go to states, localities, and certain nonprofit organizations for some specific public purposes and say, "Does anyone out there want this building?" Uh that's typically a 30-day process, and that can either result in a sale to one of those entities or potentially uh uh basically a donation at zero value. It depends on the purpose. So, that's the next round. Is there a state, locality, or other public use for this building beyond the federal government? If no one's there, so that's the second step.
▶ 0:32:26Third step, so neither the federal agencies nor the state locals want it, then it can go up for public sale by competitive means. That can be via an auction, either physical auction or an online auction, or via sealed bids. Uh GSA announces those properties on its website. You can go right now and see everything from a lighthouse that's for sale to uh commercial office space. And then that process is followed through until the building is sold. Okay. And how long does that typically take? Uh that can take a long time. Uh 1 to 5 years. Okay.
▶ 0:32:55So, is would you consider that a barrier to sale, right? I mean, just Do we need to speed that process up? Is there a way to speed that process up? So, I think one thing that Congress could do is take a look at those steps I described here, see if there should be more flexibilities in pursuing those steps. Um Uh certainly, there is a fair amount of red tape uh that is involved in the Uh there are also environmental historical preservation reviews that are part of that, too, by law. Uh that can take time. So, again, it's not a one-size-fits-all uh for all these buildings cuz there's a huge range.
▶ 0:33:24I mean, this is everything again from lighthouses and houses, little houses that are being sold to big office buildings. Looking at Are there efficiencies to be gained there? Do you think on you know, you talk about all the studies that have to happen and um you know, environmental reviews, is there a duplicative um Are are there duplicative things happening in that space that you think we could simplify or again, you talk about flexibilities there, reduce some of those regulations? Have they been looked at recently to see if they're even still still needed or relevant?
▶ 0:33:51So, I I would say I'm not aware of duplication where there's something straight up you're doing something twice. Uh typically, what happens is it depends on what the property is. So, for instance, the environmental study might not take long unless you find an issue, and then it might take a very long time. Uh similarly, a building may not be historic, in which case that is not uh going to take a long time, whereas if it is, that can add a lot of time.
▶ 0:34:13So, I don't think there are There has not been We have not done a recent study of uh those disposal processes, but I can say that it has been a challenge in the past, and it continues to be uh a challenge to get these buildings off the books. What do What would you say, given the feedback you've gotten over the years, um is the biggest complaint that you get in this process from people who are buying property? Right. Uh that it's slow and bureaucratic. Okay. Okay. Thank you. I yield back. Thank you very much, Ms. Hinson. Uh chair now recognizes Mr.
▶ 0:34:43Ivy for 5 Thank you, Mr. Chairman. Uh Mr. Maroney, thank you for coming in today. We appreciate your testimony. Had a chance to review it. Did want to comment on a couple things that are not directly related to your testimony. The first is the FBI headquarters. Although the principles that you've talked about um are relevant there. Uh I'm looking at the testimony from GSA from about a year ago, April 10th, 2024, before the T&I Committee.
▶ 0:35:13And it talked about the dire need for a new headquarters for the FBI. With respect to that, it said that there are dispersion of FBI elements across several locations in the National Capital Region, and that it was creating management challenges that impede the FBI's ability to respond to emerging threats.
▶ 0:35:32And so then he walked through the the process that they've gone through since 2011 that led up to the culmination of the selection of the site in Greenbelt, uh which the testimony says was uh the site was most advantageous for the government cuz it has the lowest overall cost to taxpayers of the three sites that were considered, best access to public transportation, um best uh likelihood for scheduling certainty.
▶ 0:35:59And it also noted that there was a fair and transparent process that guided uh that was guided by the agency's best process uh uh and uh site selection. So, want to make sure that we got those points out because in my view, moving forward with the Greenbelt site would actually be in the best interest of the federal government and the taxpayers for all of those reasons and more. Um wanted to also sort of join in Mr.
▶ 0:36:23Pocan's comments with respect to the jurisdiction of this subcommittee and the overall committee with respect to issues that the United States is facing right now. Um Congressman Hoyer, who couldn't be here today, his wife's uh getting some medical appointments taken care of, but wanted to raise that. He's he'd sent a letter. He sent several letters to the chair, one stated March 24th, 2025.
▶ 0:36:51And that letter raised the issues of what DOJ is doing, um Elon Musk, uh and OMB. All of those fall under this subcommittee's jurisdiction, and the need to address or get some sort of oversight proceedings with respect to what they're doing and the impact it's having.
▶ 0:37:09I have a lot of federal employees in my district, uh but beyond that, there's also the the uh issue of the services that are being reduced because the uh the cuts that are taking place with respect to the uh services that can be provided because of the reduction in the number of employees. This letter, and this is signed by Mr. Hoyer, Mr. Pocan, uh Mr. Bishop, myself, and uh Ms.
▶ 0:37:35Kuster and Camp-Perez uh to the chair, ask for the committee to conduct oversight hearings with respect to these issues. Now, I know there's a recent court decision from yesterday that addressed uh OPM's terminations, I guess, or effort to lay off. I think it was 16,000 employees. And there's a case going on in California.
▶ 0:37:57There's one going on in my district of Maryland as well with respect to laying off these Um and the Supreme Court yesterday said that they didn't want to move forward with that before procedural reasons, standing issues. And so uh the Maryland case is going to go forward, but you know, it seems to me that if the depending on what happens with the case in California, they may not go forward with exploring the facts.
▶ 0:38:21And I think it's important for us to do that one way or the other so the American people can have a sense of what's being done and what the impact of these terminations is, and also whether they're legal or not because the court didn't reach whether the the decision to terminate them was legal or not. Although the trial court said that it was not, uh and the court in Maryland said that as well. So, my hope is that we can step up and follow the uh the constitutional obligations we have to meet these oversight obligations.
▶ 0:38:51Uh I think it's a critical part of what we can be doing as appropriators, the power of the purse has also been I don't want to say hijacked, that might be too strong, but maybe not. Uh and the combination of our power of the purse and our oversight ought to be used now because the uh impact on the uh not just the employees, but the federal government across the board and the services that can or cannot be provided is incredibly uh far-reaching.
▶ 0:39:18We had a conversation this morning with respect to the impact on Social Security uh Administration offices. Uh I believe that there's been uh very dramatic cuts and dramatic increases in the services that are provided. In some some of the offices have been closed entirely, and people are having trouble getting access so they can raise issues about not getting their Social Security benefits. Same things for veterans who need to get their benefits as well.
▶ 0:39:46So, I'm hoping that we can address these types of issues in the very near future. Thank you, Mr. Chairman, and thank you, Mr. Maloney, for coming in. Chair now recognizes Mr. Alford from Missouri for any questions he may have. Thank you, Chairman Joyce. The federal government owns a massive portfolio of buildings and structures which cost the taxpayers billions of dollars each year to operate and maintain.
▶ 0:40:09As we've heard throughout this hearing, many of these facilities are in dire need of repair with deferred maintenance and repairs needs now estimated at a staggering $370 This figures up dramatically from the $208 billion estimate in 2020. And given that federal employees have largely been working remotely for nearly half a decade since COVID, it raises the question, how have the DMR costs nearly doubled during the time of reduced occupancy? Why should American taxpayers be asked to foot the bill?
▶ 0:40:37Nearly half a trillion dollars to repair and maintain buildings that are chronically According to the 2023 Public Building Reform Board report on federal real property, Ronald Reagan Building, where US Customs Services house, 3.1 million square feet, 12% occupied. Herbert Hoover Building, Department of Commerce, 1.8 million square feet, 12% occupied. Robert F. Kennedy Justice Department, 1.2 million square feet, 12% occupied. Harry S. Truman Building, Department of State, 2.5 million, 12% occupied.
▶ 0:41:07GSA headquarters, 670,000 square feet, 14% occupied. My favorite, the James Forrestal Building, Department of Energy, 1.7 million square square feet, less than 1% occupied. Robert Weaver Federal Building, 1.2 million square feet, 12% occupied. IRS Building, 1 million square feet, 12% occupied. Hubert H. Humphrey Building, 1.1 million square feet, 12% occupied. J. Edgar Hoover Building, 2.8 million square feet, 12% occupied.
▶ 0:41:35Department of Agriculture, 1.5 million square feet, 6% occupied. Two beautiful buildings just down the road. William J. Cohen Building, Social Security Administration, 600,000 square feet, 12% occupied. Ariel Rios Federal Building, uh Bureau of Alcohol, Tobacco, Firearms, 650,000 square feet, 12% occupied. Federal Trade Commission, 500,000 square feet, 12% occupied. Mary Switzer Building, 500 square thousand square feet, uh 12% occupied.
▶ 0:42:04And the James L. Whitten Building, the SBA headquarters, 406,000 square feet, 12% occupied. Mr. Maloney, why are we keeping these buildings open? Why are we not consolidating these buildings? Uh take half one of the buildings of the USDA and move the SBA over there. Why are we not acting now to consolidate these buildings? Well, we should be. There is extra space uh to consolidate over time.
▶ 0:42:30The federal government has for a very long time uh it's been on high risk for 20 years now had extra space. Now that the during the pandemic that increased significantly with uh the expansive telework that was done over those years. Uh but it's been a long-standing challenge and it does make sense to figure out what buildings are in the best condition, where there is enough space to house multiple agencies, and to consolidate. But why is this taking so long? Uh it's it is taking so long for a number of reasons. I think uh Cuz it's the federal government.
▶ 0:43:00Well, there is some of it is agency reticence, right? To sharing space. Some of it's money. Look, uh the SBA under uh Administrator Guzman came to us. I'm I sit on the Small Business Committee as well. Wanted an increase in funding for their headquarters. They weren't even using 4 to 6% of their building. It's ridiculous. How do we get a clearer picture of what is really needed when the administrators of the agencies aren't being forthright in their their numbers and their requests and their needs?
▶ 0:43:28So, the good news on that front, Congress passed as part of the WRDA this past January a requirement that as of this summer, agencies will be required to collect utilization data for all their buildings on the lease. So, starting this summer and then with requirements going forward, agencies will have to be able to show how are we using the space and then GSA and OMB under that law will be required if agencies don't get at least to a 60% threshold to start looking at disposing of those spaces. And what's the time frame on that happening?
▶ 0:43:56So, that is under the law that is over a two-year period. So, this January is the first check and if buildings are still under 60% the following year, that's when GSA and OMB are directed to In closing, I have less than a minute. I'd like to follow up on Mr. Bishop's uh prescient question about uh reduction in buildings. Under the Biden administration, you said there was a plan to reduce buildings by some 30%. That was the ask.
▶ 0:44:19Was that because of a reduction in workforce or because he knew people were going to stay working at home, he wasn't going to do anything about it, and so why not just reduce the buildings and have a bloated government Well, what I can say is at a at a high level, one of the motivations for those reductions was that the space was not as needed. And that was Because people were working from home.
▶ 0:44:39That could that is certainly one He increased the federal workforce by a The difference between President Trump and President Biden is Trump wants to downsize and rightsize the federal government, close these buildings that have deferred maintenance, and and make sure that we are making America first again. Thank you, and I yield back. Congressman Neals back. And the chair now recognizes uh Miss Gluesenkamp Perez from the great state of Washington. Thank you, uh Mr.
▶ 0:45:09Chairman, and um thank you to Miss Henson. I thought it was an excellent line of questioning on on your part. Um so, I ran an auto repair and machine shop before getting here. We still own it and for a while we almost put uh preventive maintenance is sexy as our as our logo as our slogan. Um I think there's this like consumer drive to buy what is new and not focus on stewardship. Public works directors are like my people, the people that make things work right.
▶ 0:45:35And um in that vein, I I I have concerns that there are Well, I have a strongly held belief there are many forms of intelligence. One of them is academic. Um and particularly in the in the skilled trades, um I have a concern about the quantity of people who do not have a college degree, who have a background in in um being master tradesmen in in a skill.
▶ 0:46:01And I'm wondering at an executive level, how many of your staff don't have a college degree, but instead have a background in the trades um making these about what is the best use um what is the best strategic use of um materials and and deferred maintenance? So, at GAO, I I do not know. I would not expect it to be a high number uh given given the work we do. GSA, I don't know either. They certainly would have skilled tradesmen as part of uh of part of their staff, but I don't know. Okay.
▶ 0:46:30I I'd urge you to to consider how that kind of paper ceiling impacts our ability to make informed decisions, not just from an academic background, but from a material um operational background. Um You know, another um question I had uh so, when we bought our our shop, we had to use an SBA loan and the seller literally had a a heart attack during the during the environmental review and died a year later um in in part due
▶ 0:47:00to that. And it's like you know, this this um to to Miss Henson's point, the the bureaucracy and the red tape in transferring land, particularly when it's staying in the same use. Um you know, in light of our national urgent mission of building back our industrial base and what kinds of reforms could Congress implement to to advance um domestic manufacturing in some of these
▶ 0:47:30excess So, I would say speaking in terms of just purely property itself, in terms of disposing of the property and the process that goes into that, I think Congress could take a look at what environmental requirements apply to which buildings. Are there any flexibilities there? Um are there any ways to reduce the amount of review depending on what you're talking about. For certain buildings, you want the environmental reviews there. Large and and they were built long time ago when there may be materials that you definitely uh want to make sure you understand what's there before you dispose of it.
▶ 0:48:00Uh but there may be some room for Congress to take a look. Are there flexibilities could be for the type of property, if it's a smaller property, if it's a less significant one of my last questions, uh I live in a really rural part of a rural district um and our post offices are really important. I think people in cities call them third spaces. Um this is where you you know, this is where you find your dog. This is where you hear about, you know, what's going on with with uh who's hiring, you know, who baby sits, whatever.
▶ 0:48:30Um it's a really fundamental and I'm wondering if in your evaluation, you're taking account of uh geographic distribution of these of these facilities and um the role they play in in local communities? So, we haven't taken a look at in terms of postal offices, or just buildings in general, in terms of where they are located. Uh in terms of the deferred maintenance backlog, it's going to be across the board, so everything from uh locations in rural to urban to suburban areas.
▶ 0:49:00So, it encapsulates all those buildings, but in terms of which buildings to dispose of and the impact on their communities, uh we have not taken a look at that. Yeah, I was I was proud to um help pass. I I co-led the FULL Act. And you know, we want to know that our tax dollars are spent prudently and efficiently and that they're being utilized and taxpayers aren't footing a bill for something that's sitting idle.
▶ 0:49:23Um and I also think um you know, who who said somebody said that um quality of care is is beyond the reach of any man who has too much work to do. Um being good stewards of what you may have means being a um uh having knowing what enough is you know and and so I guess my question is that within within this decision-making like it is it is urgent that um it's urgent that
▶ 0:49:53we are accounting for these these third spaces the rural post offices really really do matter to to my communities and we also feel like you know a lot of these more urban places they have they have quite a bit of facilities and and so we just urge a consideration of geographic distribution in this process as well. Thank you. I yield back. Thank you very much. The chair now recognizes the vice chair of this Mr. Loud.
▶ 0:50:24I didn't get distinguished gentleman nor did I get the same in New York just for the record. I got to lodge my complaint afterwards Mr. Chairman. Thank you. Is it Nevada or Nevada? I heard you say it a certain way. Glad that we're all laughing now. Good Mr. Money good to good to be with you this morning. You're the director of physical infrastructure at the GAO. Is that correct? So you're like a massive federal property manager. Is that about No, we analyze federal programs that do federal property. Okay.
▶ 0:50:53You give good recommendations to those who actually do the management. Great. And there are about 285,000 buildings under your purview. Uh not under our purview but we review GSA that does have buildings under its purview. Got you. And the ones that you review they're worth about 1.2 trillion dollars. Is that about right? Uh in terms of replacement value that sounds My colleague is shaking his head yes too so by the way so you we're probably on the right track. My staff's research suggests that for decades much of the maintenance on those properties has been neglected. Is that right?
▶ 0:51:24So there has certainly been some maintenance that has been neglected. Yes. And the term we use for to excuse ourselves from not doing that maintenance often basic maintenance meant to preserve the value and the operational capability of those properties we call that deferred maintenance. That includes that is part of deferred maintenance. Yes. And can you describe director the impact on those 285,000 properties when we defer the maintenance? What happens to their value? What happens to their operational capability to their usefulness? Yeah.
▶ 0:51:51If it's a significant issue that's being deferred it can directly impact the ability of that the use of that building the mission of that building. Some things are more minor where it isn't as big of a deal but for critical items it can really have an impact on the condition and the value. Yeah. So when you quantify the the dollars of deferred maintenance you know we save a a specific amount of money per year when we do when we defer the maintenance but then when you quantify how much cost there is either on devaluing the property or the reduction the operational capability do you have an analysis on the comparison of those two categories?
▶ 0:52:21We don't but I can tell you gentlemen it's penny wise pound foolish right? Like if you don't spend the money now you ultimately are going to spend more in the future if it's a significant system. And that's certainly my feeling and I'm worried about sticking our taxpayers later on with a bigger bill. Now my colleague from Missouri's point is offload these properties. Get them off your books. We're not using them anywhere to near their capacity. He went through a huge list of of buildings that are and I hate to hesitate to use this analogy but do you watch any home improvement shows?
▶ 0:52:51I I do it from time to time. Yes. I I I watch them in my household not because I put them on my wife puts them on all the time and what we see is investors who spend a little bit maintain the property upgrading them can then sell them for more. Is there an analogy to be had in the federal system that if we maintained or improved these for the purpose of offloading them is that a situation that is more pound wise and less penny foolish? Well certainly at a first level maintain the building so they can be used for their purpose is important.
▶ 0:53:20It's cheaper long term and secondly if you're disposing of buildings a building that's in building better condition is likely to get a higher price in the end. You're also going to have to spend less in operations and maintenance over time even if you're holding the building. And when you're doing your evaluations you provide your recommendations. Do you take into account the usability or the capacity? If it's only 1 2 5% use as Mr. Alford pointed out to us do you take that into account when considering how much maintenance to do on a specific building? So not the maintenance itself.
▶ 0:53:51I mean you still need to maintain the building cuz it's an asset but what you do consider is do we keep that building? If it's only at 1 to 5% use that's a building you should be looking at either to consolidate into if it's in good condition or if it's in poor condition you should be looking at should be disposed of this. Okay. Focusing specifically on the maintenance and the cost thereof there's a bunch of maintenance that winds up getting deferred. Do you do any analysis on prioritizing some of the dollars that you will spend on maintenance for the purpose of getting that building off of your books?
▶ 0:54:20Agencies should be certainly the maintenance the key maintenance the critical things that are important for the building and the mission as opposed to again some of this deferred maintenance could literally be the paint needs to be replaced down to the HVAC system is failing. The HVAC system you need to prioritize to maintain that building in operating form. The paint if you defer it you know I I I didn't ask my question the right way perhaps.
▶ 0:54:41When considering getting some of these buildings off of your books especially the ones that are underutilized 1 2 5% utilization are you considering prioritizing some of that maintenance for the purpose of getting that building off of your books? If there's a dilapidated property that has you know structural issues other issues that are beyond just you know paint and touch-ups that a new building owner would then fix him or herself.
▶ 0:55:04Are you considering prioritizing the allocation of of dollars for the purpose of getting these maintenance dollars for the purpose of getting some of these buildings off your books? So in that situation I would not prioritize to the building that is already in poor condition and is underused. I would be looking at how do I get this off the books the building itself. It would be prioritizing dollars to the buildings that are either in good condition or that are starting to become marginal so you maintain them in a good status. But if they're already in poor condition it's time to look at getting rid of it. That's helpful.
▶ 0:55:31Hopefully we can continue this conversation about how to efficiently use our money and our buildings. That's good. I yield Chairman yields. With that our time is concluded. There may be some members who would like to submit questions for the record. Please submit any questions for the record to the subcommittee staff within the next seven days. I'd like to again thank you for your time here today on this important topic and the subcommittee now stands adjourned.
▶ 0:56:04Thank you. Very helpful conversation. This is a topic I was he was asking me how I picked it and I said well when I was at Interior that was the biggest problem we had the national parks was deferred maintenance.