▶ 0:08:49That will come to order. This hearing is titled gao assessment of the federal buildings fund. Members will have five legislative days within which to revise and extend their remarks and insert extraneous material into the record. I now recognize myself for an opening statement. The general services administration, or gsa, maintains, builds, leases, or operates more than 360,000,000ft of space that houses thousands of federal employees and 2200 communities across our country.
▶ 0:09:13In addition, our constituents visit gsa managed properties every single day. Everyone from veterans accessing their benefits, disaster victims seeking assistance to plaintiffs and defendants attending court enter a gsa property. However, gsa's management of federal real property has been on the government accountability office, or gao high risk, since 2003, and the scope of the crisis has never been clearer.
▶ 0:09:38The public buildings reform board, which oversees our public buildings, recently released a report indicating that the deferred maintenance in the federal building portfolio has become a $50 billion liability. Gsa's public buildings service, or pbs, is responsible for the maintenance of the gsa managed facilities. Most of pbs activities are supported through the federal building fund. The fbf, as it's commonly known, is funded by agency rent payments to gsa. But as many of you know, the fbf is subject to the appropriations process.
▶ 0:10:08Over the last several years, the fbf has been used to fund other priorities. As a result, the fbf has been and continues to be insufficient to address the deferred and regular maintenance of federal real estate property. We need to have honest conversations about how we get these costs under control. It starts with disposing of federal properties with high deferred maintenance and low occupancy to reduce the strain on the fbf. Moreover, ensuring the fbf has the resources it needs to maintain federal properties is another part of the equation. I'm pleased that we have Mr.
▶ 0:10:38Moroni from gao here again to assess the fbf and how to get gao's perspective on the scope of the issue facing the fund. I look forward to our discussion today. I now recognize my distinguished ranking member of the subcommittee, Mr. hoyer, for his opening statement. >> thank you very much, Mr. chairman. I want to thank Mr. moroni for being here and joining us today.
▶ 0:11:03We've heard much discussion of improving government efficiency and reducing waste this past year. All of us should share that objective. Although I have serious doubts about the administration's commitment to those goals. We all ought to agree that those objectives ought to govern how we administer our federal real estate portfolio. We want to make sure we have the right amount of space and the right type of space for our federal employees to do their jobs.
▶ 0:11:29On behalf of the american people as effectively and as safely as possible, I always say we need to rightsize the government, not increase, decrease, but right size for the job that we give them. I recognize that no easy task, as I'm sure director moroni would agree. But it's also clear that the general services administration management of our federal real estate is wanting in some cases.
▶ 0:11:53I'd like to quote from a specter general's report that was released just this week, and I have that report here, and I imagine you brought it with you. I'd like to quote from that. Gsa is not consistently addressing deficient security fixtures at gsa controlled facility, and as a result, is leaving the public, employees and property at risk from security threats. That finding ought to concern every member of this committee and this house.
▶ 0:12:20Much of that report was redacted, but it indicated that, I presume, for security reasons itself. But it is indicated that gsa failure to meet this crucial responsibility was due in part to the immense cost of installing and maintaining security measures. To see the perils of this issue, just look down pennsylvania avenue. The trump administration is trying to move the fbi headquarters from the dilapidated and falling down j.
▶ 0:12:48Edgar hoover building to the reagan building just a little ways away. Moving the fbi out of one old, exposed and inadequate building into another old, exposed and inadequate building is not a solution.
▶ 0:13:04When former fbi director robert mueller, who just died, approached me in 2009 about finding a new home for the fbi, he emphasized that the bureau needed a new, secure and consolidated facility on a large campus. The reagan building fails to meet the fbi's security and operational issues. It was not designed as a secure law enforcement facility.
▶ 0:13:32Rather emphatically as an open, accessible office for both public and private tenants. As a matter of fact, I have an article here that reflects that objective. To use the words of pei cobb freed and partners, the architectural firm that designed the facility. Quote, the reagan building emphasizes access and permeability.
▶ 0:13:54Access and permeability are great features of an international trade center, which the reagan building was designed to fulfill, but not a law enforcement and intelligence agency.
▶ 0:14:08An article in the chicago tribune published about the building in 1997 noted the very fact it said the reagan building, quote, will open the standoffish domain of the federal bureaucracy to the city and teach an important lesson to the post oklahoma city bombing era, when the temptation is to turn all government buildings into impressive fortresses. But the fbi headquarters needs to be impregnable.
▶ 0:14:36Even the reagan building were not located between two major thoroughfares, 14th street and pennsylvania avenue. It still would not meet interagency security committee facility security level standards. The gsa says it will take at least $1.5 billion to to retrofit the building, but anyone familiar with the gsa knows that project. These always cost much more.
▶ 0:15:03And the architect of the capitol said it would be cheaper to build a fourth building for the house than to relocate members while repairs are being made to rayburn into the madison building. This ill conceived effort to move the fbi into the reagan building is indicative of the dysfunction that exists at gsa.
▶ 0:15:25Director, I'm going to be asking you some questions, as I told you I would, and I imagine you share some of these concerns which are reflected in this report. Issues contribute to the mismanagement of our federal real estate. Thank you, Mr. chairman. I have 13 seconds, and I'll yield back. >> tremendous timing today. Thank you, member hoyer. Today we welcome the testimony of Mr.
▶ 0:15:52David mahoney, director of physical infrastructure at the united states government accountability office. Mr. mahoney, without objection, your full written testimony will be entered into the record. With that in mind, we asked you to please summarize your opening statement in five minutes. >> thank you, chairman joyce, ranking member hoyer and members of the subcommittee. I'm pleased to be here today to discuss the federal buildings fund and the future of federal property.
▶ 0:16:15For more than 20 years, gio has identified the management of federal real property as a high risk area in need of substantial transformation. The federal government simply has too much space, with much of it in poor condition. The federal buildings fund will play a key role in how effectively this problem is addressed. As you know, the fund is gsa's sole source of money to manage the buildings under its control.
▶ 0:16:42Specifically, gsa collects rent from tenant agencies, deposits it into the buildings fund, and uses that money to fund its real property work, subject to appropriations. For the past 15 years, there has been roughly $1 billion gap each year between the amount gsa has collected in rent and the amount congress has authorized gsa to spend. That funding constraint has made it more challenging for gsa to pursue large projects, properly, maintain its building, and dispose of unneeded properties.
▶ 0:17:12There are a variety of actions congress and gsa can take to address this funding issue. For example, terminating unneeded leases and disposing of under-used buildings, particularly those in need of large capital investments, would reduce the strain on the federal buildings fund and could free up money for gsa to properly maintain priority buildings that are being held for the long term. Congress could also consider alternative financing mechanisms for large projects and alternative budget structures.
▶ 0:17:41For example, congress could modify the buildings fund to exclude certain major projects and instead provide direct appropriations to tenant agencies for those projects. It could also appropriate funds specifically for the upfront cost, for properties being prepared for disposal, and for consolidating tenant agencies into better maintained and more cost effective spaces. All of these options come with trade offs. There is no silver bullet, but they're worth considering. That said, the fundamental issue goes beyond funding.
▶ 0:18:10The federal government simply has too big of a footprint, and a lot of it is in bad shape, spending large sums of money to preserve that existing footprint just doesn't make sense. Instead, congress, gsa and other agencies need to ensure current efforts to dispose of underused property lead to results, while also ensuring that priority buildings are well maintained for the long term.
▶ 0:18:34This will take an upfront investment of money, but if executed in a sustained and well-planned way, the long term cost savings could be in the hundreds of millions of dollars or more, and agencies could end up with better space to carry out their missions. Mr. chairman, that concludes my opening statement. I'll be happy to answer any questions. >> thank you sir. Appreciate the quick opening statement, but you cover a lot of issues there. I now recognize myself for the first question.
▶ 0:19:03And, you know, you brought up Mr. moroni that we talked about. Gsa's vast portfolio includes 285,000 buildings and structures with significant deferred maintenance problems. It seems this problem just keeps getting worse. As I mentioned in my opening statement, the public buildings reform board issued a report highlighting the real deferred maintenance costs of federal property to be somewhere in the area of $50 billion. These liabilities represent real costs to the federal government into the taxpayer.
▶ 0:19:30Uh, in your opening statement, you talked about some of the things we can do, but why can't gsa get a handle on the deferred maintenance problem? And do you believe that $50 billion is the true cost of the deferred maintenance? >> so starting with first. >> could you speak into the mic, please? >> starting with the second question first. Uh, $50 billion. So we did work on this a few years ago.
▶ 0:19:53We found gsa based on their financial reports to be about 6 billion administrator forced a few weeks ago, testified it was $26 billion or more. Uh, public buildings reform board has said 50 billion. Whatever the specific number, the trajectory is clear. There is a lot of deferred maintenance that is growing significantly. And then in terms of how is it to get a handle on that? There's a couple of things driving that. One is these buildings simply haven't been maintained well over decades, over years. Some of that is funding.
▶ 0:20:21Some of that is how the process has worked out. But there's also a significant factor that these buildings are old. The average age of a gsa building is over 50 years, and at that point you're going to have issues. It's going to be more costly to maintain them and repair them. So it's a hard problem to get around. The key way to get around it right now is to identify those buildings that are both underused and have high liabilities, and prioritize those for disposal. Get them off your books. It's going to cost too much to give them up to speed, especially if they're underused.
▶ 0:20:51There's not a reason to keep them. >> is there a market for those? >> so it's going to depend on the specific property. There can be a market for some properties, particularly their location. The building itself may not be especially valuable in other situations. The building may be something that could be redeveloped by the private sector. It's going to depend in some cases it's not going to be very valuable, but simply getting it off the books if it's not being used, if you have opportunities to consolidate, would still be worth it long term because the operation and maintenance costs for that building is going to dwarf the cost of getting rid of it over time.
▶ 0:21:22>> in some areas, you have properties that are probably worth more than the building, correct? >> I think that's correct, yes. >> and so do we have the money for demolition to create the site for sale, or is that something that you're you hope to sell in the market and let the, the buyer then take out those costs? >> so again, it would depend on facts and circumstances generally, I think going to the market and seeing what you can get for the property, even if you're selling it as is with the idea they would demolish it would be simpler.
▶ 0:21:47There may be some situations where demolishing the building, uh, could make sense, but you're going to have to have that upfront funding to demolish or move the materials, do any remediation, then turn it over to whoever buys the location. So generally speaking, it would be simpler if you can sell it on the market, even at a reduced price to get it off the federal government's books. >> now. >> when you mentioned the federal funds, are you also talking about like the public service or public parks that fall under interior? Is that part of the umbrella? >> I'm speaking about the federal buildings fund specifically.
▶ 0:22:16Uh, different agencies have some ability to operate and maintain their own space, but the same problem is consistent across agencies. The overall for the federal government, when we did that deferred maintenance report, it had more than doubled the liability since 2017 to about $370 billion. Now, that includes dod. That is a big chunk of that number. But still, you can see it is a large and growing problem, not with gsa buildings, but across the board. >> I heard you correctly in your opening statement.
▶ 0:22:41You said that perhaps, uh, placing the responsibility upon, say, the courts to maintain their own facilities would be a good idea or a better use of dollars diarrhea. >> uh, we don't have a we don't have a position on the judiciary proposal to manage its own buildings. I would say I can understand judiciary's frustration. There are at times been issues with maintaining buildings, not just judiciary across the board with agencies.
▶ 0:23:07Um, I would say some things I would think about if I was congress is would we be duplicating costs by having judiciary run its own space? Does judiciary have the expertise? How much would it cost to have that expertise brought in to manage what is a nationwide portfolio? And then last, I would look at the impact potentially on the federal buildings fund itself. Judiciary is a big portion of that, and if you took that revenue away, you might lose some of the economies of scale that gsa provides.
▶ 0:23:34So those are I don't know if there's a right or wrong answer there, but those are definitely things I think through on that proposal. >> yeah, I'm getting down on my time, but that's what I was wondering. It's got to be cost effective when you have the leverage to be able to do this on a greater scale versus independent agencies or departments than taking over the funding of their own buildings, because. >> that's sort of the thinking behind gsa, right, is that you're consolidating.
▶ 0:23:58Now, there are agencies that do manage their own property that does that does happened, but gsa is there, has the expertise, and it's doing things on a nationwide level. So it has economy quickly. >> do they have the same problems? >> does. Yes. This again is consistent. >> chair now recognizes ranking member hoyer for his questions. >> thank you very much. >> and again thank you very much for being here. This you're familiar with this report? Yes. And gsa is not consistently addressing deficient security fixtures at gsa controlled facilities.
▶ 0:24:29>> yes. >> uh, as you as you heard from my opening statement, I'm very concerned about the proposals regarding the federal bureau of investigation. You're familiar with the state of that building, I take it I am. How would you describe the state of that building. >> the hoover building? Yes, it's it's deteriorated. They need to move. >> it's decrepit. Right. Um, now, let me ask you a question with respect to gsa's focus on security. Much of this I don't know about this report. Yeah. Much of this report.
▶ 0:24:59Is redacted. Just so you don't really know what's happening. It's a good report. Pretty long report, about 30 pages, but most of it's redacted. Um, the security concerns were the reason robert mueller came in to me after the murrah building in 1995 was destroyed by a single person in a step van. Uh, and I've talked to most members of the committee about this. Um.
▶ 0:25:32And this report says that gsa is really not looking at the security concerns essentially sufficiently, let's put it sufficiently, um, in your experience, uh, would the reagan building be, uh, difficult to make secure, consistent with federal standards? >> it would certainly require a large investment of funds.
▶ 0:25:56Uh, it was built to be a public facing open building, so you would have to invest a substantial amount of money to make it secure. >> can you cite any instances of retrofitting which is proposed, any building to meet level five projections? Do we have any experience with that? >> I'm not aware of any. I can come back to you record for sure, but I'm not aware of any. >> thank you very much.
▶ 0:26:19Um, do you have, uh, any accounting on how much it typically costs to get the prospectus stage of a project. >> in terms of the cost of the time? >> yeah. >> so the time is 19 to 24 months generally from when a prospectus is submitted to get to the end. The cost depends on the project. It's anything above 4 million basically has to go through that process. For $4 million, has to go through the process.
▶ 0:26:47>> and we have, uh, I'm hopeful that we will ask before they move forward to give us a estimate of what the cost will be and how they will reach if in fact, they can reach the security five levels. Uh, do you think that's a rational thing to do? >> it's good to have cost estimates and the part of your plan. Yep. >> um.
▶ 0:27:08With respect to the staffing responsibilities and managing your, the portfolio that you deal with, um, the reduction often moved faster than the efforts to sell buildings or reduce lease space. I agree with you. And by the way, uh, one of the prime sites in washington is the fbi building on pennsylvania avenue. So there will be an offsetting income from the sale of that.
▶ 0:27:41And the chairman mentioned the property itself, not the building, because the building's gone, but the property itself is a very, very valuable property, which would be an asset for the federal government. And in your, uh, testimony, you said selling those would make sense. Uh, Mr. chairman, I'm going to stop with that. I may want to ask some other questions in a second round, but I'll stop now. >> very kind. Mr. hoyer.
▶ 0:28:08Uh, the chair now recognizes miss henson for any questions. >> thank you. Thank you, Mr. chairman. And to our ranking member for holding this hearing. Mr. rahman, it's good to see you again. And thank you so much for for being here to answer our questions. And I think we had a good conversation about the federal portfolio last year. I look forward to building on that, uh, here today. And, um, when you look at what the g. I o identified since 2003 as a high risk, of course, with retaining underused space and the cost to taxpayers and millions of dollars a year.
▶ 0:28:36Uh, the significant solution is to get rid of as many underutilized assets as possible. But I, I'm hearing some pushback from agencies that are saying, you know, they're continuing to have to pay leases on these underutilized spaces. Um, even if they don't have staff there, but they're running into some, some barriers. And in your testimony, you highlight gsa reporting that some of the uncertain funding has resulted in missed opportunities to eliminate leases.
▶ 0:29:01So can you explain how funding is directly tied to the ability to terminate leases? >> yeah. >> so first, anytime you terminate a lease, you have to relocate the folks who are in that space to a new location. So there's moving costs. You have to return the space in a certain condition. So there's cost to do that as well.
▶ 0:29:20And depending on the term of the lease, if you're in the soft term, which is after a certain number of years, you are able to terminate that lease under certain conditions, but more easily if it's in the firm term, which is typically the first several years of a lease that is much more challenging and can incur additional costs. So just terminating a lease requires having a plan for what you're going to do with the staff who are there. >> what are the shortest term leases that we're signing versus, I mean, is it as simple as a couple months all the way up to 20 years?
▶ 0:29:51>> what are the. >> length of these? >> so normally this is about ten years. You have some that are shorter. You might have some that are longer the longer you're getting, uh, the trickery it might be in terms of funding. At that point, you should be asking, should we be in owned space if you're going for significant long points of time. >> so do, uh, early lease termination costs play into the recommendations here in terms of how it's been recommended for gsa to run the cost comparisons of terminating leases compared to like you were talking about just paying out the full lease term, whether it's 10 or 20 or however.
▶ 0:30:20>> long that should be part of your analysis. Do we gain from terminating this lease or not? And do we have a plan for where we're going to put those staff? And when you compare the costs, is it a does it pencil out? Is it a net benefit or not? >> how much is that actually happening right now in terms of running these numbers? I mean, is that an active process? I mean, can you get us numbers on how often this is happening? >> so I do believe that that is part of the normal process that gsa is to follow.
▶ 0:30:45Um, I do not know right now, uh, how to the extent that that process is being followed, but that's the norm is they do try and pencil out the benefits versus the costs. >> okay. Can you share maybe some of those other recommendations to specifically address the barriers to terminating leases for some of these spaces outside of that, that regular, I guess you'd say, list checklist that you're kind of going through right now, right? >> so what you need to do is for your portfolio overall, for whatever agency you're speaking about, you need to understand what are my needs? What are my space needs and what space do I have now?
▶ 0:31:15And is it meeting that need? Or do I have too much? And then going through, you have to have some strategy going through and looking at, okay, I have too much space in, you know, in dubuque, and I can consolidate these two leases into a single location and save money. And it's worth it because the cost of moving is less than that. But you really need to look at a strategic level, plan it out and make sure you have that funding to carry through your plans. With both the lease side and any own space. >> okay, um, I'll have some more questions on security, but I don't want to dive into that.
▶ 0:31:45So we'll get into that in round two. Thank you so much. I yield back. >> thank you, Mrs. hanson. Chair now recognizes Mr. pocan for any questions. >> thank you, Mr. chairman. Appreciate it. And Mr. maroney, thank you for being here for the second year in a row in a public hearing. I hope everyone that has oversight under this committee follows your lead and is here for public hearings every year. I appreciate that. Um, I'm sure you know that gsa has marked the historic, um, william j. Cohen federal building as a candidate for accelerated disposal, making it available for sale and vulnerable to demolition.
▶ 0:32:12This building has been referred to by new deal art historians as the sistine chapel of new deal art. Uh, it's listed in the national historic register of historic places and has one of the most significant collections of new deal era public art in the united states. Because so much of this artwork is integrated into the architecture of the building, there's significant concerns that improper redevelopment or demolition could result in the permanent loss of a major piece of american cultural history.
▶ 0:32:44So, uh, I guess the question I have is what actions can the gao, what have they recommended congress take to ensure that all federally owned assets, including artwork integrated into buildings like the cohen building, are adequately inventoried, protected and considered before any sale or disposal happens? >> so we haven't done direct work on that topic. But what I can say is, uh, gsa does have as part of historic preservation screening, they are supposed to identify art. That's part of that.
▶ 0:33:11And they can include requirements in property sales that require the protection and preservation of that art. Now, I can't say the process that's being followed right now, but I can say that is the standard. I would say just in general, uh, real property data overall is, uh, typically flawed. And it wouldn't surprise me if art is as flawed because it actually can be moved. So it's actually trickier. Some, at least art can be moved. And so it's trickier to keep track of. So it is a concern.
▶ 0:33:39What's the data? Do we know what's where and how we're preserving it? >> yeah. And this building in particular, I think it's integrated into the building much of it. And um, I know that last april doge forced most of the gsa, fine art and historic preservation staff on administrative leave. Do you know if any of those folks are back to do some of this work? >> I don't know if they're back, but that would also be a concern. You need the staff, obviously to track it. >> if you could get back to us on some of that, I would really appreciate it because I know there's a lot of concern.
▶ 0:34:09We'd like to preserve what's in that building. This question, I wasn't something, um, my staff gave you, so I'm going to apologize in front as I, uh, asked this, but you you have oversight at all over the white house. I mean, I think loosely you do the gao. My question specifically is around the ballroom. I know that it's funded by private donations, but I believe the ongoing costs of maintenance and security would still be our costs. Is that correct? >> so I don't know if it is or not. Uh, it very well could be.
▶ 0:34:39>> would this be under the gao that could do a paper on this to get back to us on other costs. >> so we'd be happy to work with your staff to consider on that. >> that'd be appreciated. Just because if there are a lot of costs that maybe aren't anticipated because it's a ballroom now instead of the east wing of the capitol, uh, certainly would be important for us to know, because I could see different security and maintenance concerns with that. So, um, and then the last question I had is around the hud building, which is being relocated to virginia.
▶ 0:35:06I know there were some concerns around the law where it I think the hud act of 1968, uh, said that the department had to be at the seat of government, which according to us code, says the seat of government should be exercised in the district of columbia and not elsewhere, and that this, uh, by being relocated, relocated to virginia.
▶ 0:35:29There's a question of whether this follows the law and how it's being paid for, and whether there's any risk of appropriated funds perhaps being misused or congress not being properly informed. Can you give me any background on this? >> so what I can say is we have just started up work in the past month on a request from senate appropriations to look at the hud headquarters relocation, including some of those legal issues you mentioned. So we don't have answers on that yet, but it is something we're taking a look at. Um, in terms of the process followed, there are processes for relocations.
▶ 0:35:59Uh, so we'll be able to have information on that soon. >> great, I appreciate it. I yield back, Mr. chairman. >> thank you. Mr. chair now recognizes Mr. edwards for any questions you may have. >> thank you, Mr. chair. Uh, thanks for being with us. This is a very interesting topic that most of us have here in congress have an interest in. Uh, can you tell me where do we begin? Uh, I think we certainly agree on the problem.
▶ 0:36:28Is there some prioritized list, uh, that we go to work on after this hearing or where, where do we start? Give us a little bit of perspective. >> so gsa has over the past several years, they have developed a list of core assets. What they consider to be the key holds the properties you would want to maintain.
▶ 0:36:50Um, they've also identified and have started to post properties for accelerated disposal ones that they've determined are either underused, have high deferred maintenance liabilities or both. Uh, so gsa has done some of that accounting. I'm not sure if they've done it across the entire portfolio, but there is some sense of the properties that have the highest. Certainly they certainly know which properties have the highest deferred maintenance liabilities.
▶ 0:37:13And under the use it act, which was passed last year, we should have in a few days utilization data for all federal leased and owned space, which will give a sense of how they're being used. >> I appreciate that you brought the use it or lose it act up and the full act. I'm the guy that, uh, that, that wrote those and got those incorporated. So I'm, uh, one of my next questions was where, where are those reports? It sounds like they're on their on their way. >> that is a good question. Our understanding is they're supposed to come march 31st. Uh, we are waiting for them as well.
▶ 0:37:44So I look forward to them. >> who has the authority to make decisions to divest of, uh, uh, real estate assets that are underused. >> so the agency itself that has the, the, the agency that self that has the property first makes the determination of we don't need this. And then depending some agencies have the authority to begin that process on their own. But generally speaking, they'll go to gsa and to say, we don't need this property, and then gsa takes over with the actual disposal.
▶ 0:38:13>> so my, my math, uh, tells me there are about 440 or so agencies. So what I think I hear you saying is it's up to about 440 agencies, bureaucracies to make the decision whether or not to divest of the property that they're holding office is in right now. >> and that has, to a certain extent, been the case until recently under the use it act, uh, that there are requirements for omb and gsa.
▶ 0:38:42If agency space is under 60% utilized, uh, to take steps to reduce that space. Uh, and so I would say in the past that would have been more true. I think now gsa and omb have a larger role in helping to identify properties to remove and under the user act, call for action for them to be disposed of.
▶ 0:39:03So it's a little you still have the individual agencies defining the requirements and what they need, but I think gsa and omb have a larger role now in looking from above at not just gsa own space, but federal real property in general. >> is there a strategy to move agencies outside of dc? I'm not talking about virginia or maryland. I'm.
▶ 0:39:26I'm talking about ohio and nebraska, nor north carolina, where maybe labor markets are a bit, uh, a bit easier to recruit from and where real estate costs are far, far less than they are right here in dc. >> so I know there have been efforts in the past. Usda particular comes to mind a couple of sub agencies there, but there have been other relocations as well.
▶ 0:39:51Um, in terms of real property, I think it's an important consideration when you consider relocations. It's not the main one. The main one would be getting. Where does it make sense to have the people to do the work depending on what the work they're doing, but there certainly could be potential real property savings depending on where in the country you moved. It would be a consideration. I just don't think it would be the the largest driver of a relocation. >> does your inventory of underutilized properties include properties outside of the district of columbia? >> it will now.
▶ 0:40:20So that was the problem when we looked at this in 2023. First off, there wasn't good utilization data anywhere. We had to limit our study to headquarters buildings because at least in dc, because at least we could get some data there. But once you got outside of it, very limited information under the usat act, now all federal owned and leased space, whether in dc or in alaska, has to be monitored for utilization reported publicly. And then gsa on being the agencies need to take action based on those numbers. >> thank you, Mr. chair, I yield back.
▶ 0:40:51>> thank you. Mr. edwards. Chair now recognizes Mr. ivey for his five minutes of question. >> thank you, Mr. chairman. Thank you, sir, for being here today. I wanted to follow up a little bit on the the courthouse piece, the judiciary piece, and get some guidance from you on that. I I'm guessing sale of courthouses wouldn't be an available option in the same way that, you know, say for the fbi building might be given that, what sorts of strategies are there to try and catch up with?
▶ 0:41:20I'm looking at 8.3 billion repair backlog, apparently for the courts. Um, what's the strategy for addressing that? And just out of curiosity, what are some of the courthouses that are in the absolute worst condition? >> so first off, there are some potential for sales. They have sold some courthouses, but it obviously requires building a new courthouse. So you're making a major capital investment to get to that place. For the others that are in, uh, not ideal state of repair.
▶ 0:41:48The the process is targeting, prioritizing, right? There are more courthouses that need repairs than there is money to fund them. And so it's prioritizing, which are in the worst shape. And then for those that are in the absolute worst shape, considering does this location still meet our needs? Can we get appropriated funding and other other alternatives to manage this space in terms of specific courthouses that are particularly in poor condition? I don't have those at the top of my head, but we can get you some examples. >> all right.
▶ 0:42:17One quick question along those lines. And this is just from my memory, but I recall I don't know, I think it was like a, b, c probably 20 years ago, did a, a series of reports on, um, I'll call them boondoggle courthouses. That was sort of pointing out that there were very, you know, extravagant expenditures to build some of these courthouses. And some of them really are extremely impressive structures. How did we have the scenario?
▶ 0:42:42We have courthouses run down into the ground where people are getting trapped on elevators. And, you know, you've got mold and legionnaires disease. And at the same time, you're building, you know, courthouses that are, you know, uh, architectural, you know, masterpieces, I suppose, but very expensive. >> so a lot of it comes down to age and the needs on that courthouse, older courthouse. There are a lot of older courthouses. Uh, that one sometimes don't meet space needs anymore.
▶ 0:43:10Uh, the court has grown in those locations, but the building has expanded and they're old and either they haven't been properly maintained over time or they're just at the end of their useful lives, in which case, it does make sense to consider building a new location. Now, in terms of the quality of the newer facilities, newer facilities are going to be nicer. There is a design guide that the judiciary uses in coordination with gsa, to say what can and cannot be included in those spaces, which is an important tool.
▶ 0:43:37We've done some recent work on that and suggested some changes to make it more cost effective, but generally speaking, the newer courthouses are going to be nicer because they will be you'll be starting fresh as opposed to these other courthouses that either through age or, uh, not enough maintenance over time have degraded. >> all right. And then I guess there are some agencies and departments where gsa plays a role in helping with the property management piece. And there are others where you don't. Which category does dhs fall in?
▶ 0:44:08>> gsa is involved in dhs property. >> okay, so for rentals, for example, gsa would be involved. >> they can be involved in leases. I'm not sure if dhs has independent leasing authority or not, which would mean they could lease their own space. But I believe they are involved in dhs leases to a degree. >> yeah. If you could get back to me on that, we've got a facility where there's at least rumors that ice wants to rent a facility in hyattsville, which is in my district. I'd be curious as to whether I should be coming to you or going to dhs about that.
▶ 0:44:36And then with respect to some of the facilities, the detention facilities that they built and, you know, alligator alcatraz comes to mind. I don't know if that's in your purview or not, but the question I had there was there are reports that, you know, ceca was not the competition in contracting act was not followed in construction of those facilities.
▶ 0:44:57And so you have in some instances, allegedly really high expenditures for what, uh, looks to me like tents and fences, relatively inexpensive materials that were built. Is that under, uh, gsa purview or no. >> so I don't know if it is or not. It's not it's not under our purview.
▶ 0:45:17Uh, gsa may be involved, but dhs does have some independent leasing authority, like for instance, the ice centers you mentioned, I believe they are ice has the authority to lease those locations. Gsa has been helping them find locations, but I don't believe they've been the one actually doing the leases themselves. I'm not as familiar with alligator alley and what they might have done with that process. >> fair enough. But in the general procurement process for construction of new facilities, ceca is the standard that is followed. Is that a fair statement? >> I believe. >> so, all right. Thank you, I yield back.
▶ 0:45:50>> thank you chair now recognizes Mr. alford for his five minutes of questions. >> thank you, chairman joyce and ranking member hoyer. Uh, the federal government owns and manages a massive real estate portfolio, hundreds of millions of square feet of space across the nation. Yet we still struggle to answer some very basic questions about what we own, where it is, how it's being used, and that's a problem. Gio has kept federal real property on its high risk list for more than two decades, pointing to persistent issues with waste utilization and poor data management.
▶ 0:46:19At the same time, we're facing a growing deferred maintenance backlog that could be as high as $50 billion. While many federal buildings sit partially empty or underused, we cannot manage what we cannot measure. And one of the core challenges here is the lack of unified, reliable and accessible inventory of federal property. Instead, the federal government operates more than 100 separate real property systems across agencies, creating fragmentation, duplication, and inefficiency.
▶ 0:46:45I think that's unacceptable for the taxpayer's tools like the federal rural property profile had the potential to bring transparency and accountability to the system, but only if the data is complete, accessible and usable. That includes making sure it's geo enabled, integrated across agencies, and capable of giving members of congress and the public a clear picture of federal assets in their communities. This is not just about data.
▶ 0:47:09It's about making smarter decisions, disposing of unused property, reducing maintenance costs, and making sure that taxpayer dollars are spent efficiently. Thank you for being here. It's been a year since we we spoke. Um, what has changed in the last year? What can you give us an update? What has been some of the accomplishments, uh, in one year's time?
▶ 0:47:32>> so I'd say the progress of the use of act, we still have to see the data and how good it is, but actually getting some indication, some indicators of how owned and leased space across the country is being used is an important first step to then deciding what is worth holding on to, what should be consolidated and gotten rid of. So that's progress. There have been some property disposals, um, including just this past week, the regional office building in southwest being disposed of. So there is progress there.
▶ 0:47:58And I'd say there's still more to be done because at the end of the day, these are not easy things to do. They take money and they take time. But the key is for the momentum that has been building for the past several years to rightsize the real property footprint that has carried through to results. My main concern is that the action continues because it's easy to get in a situation where there are delays, where time passes on and properties are not actually disposed of, they're held on to. So I think there's been good progress the past several years. It's important to sustain that and move forward with the new data.
▶ 0:48:28>> what challenge is it trying to predict the in-person labor force at these buildings? >> yeah, so it depends on the size and location of the building in some of these big headquarters buildings in dc, uh, using badging data has become is a relatively straightforward, in most cases to track attendance and also for purposes of utilization, using that information to figure out once you get into the field, into smaller spaces.
▶ 0:48:53Again, if you're talking an office building in a downtown that's relatively straightforward, again, badging, but smaller spaces can be challenging. But gsa has identified a number of ways you can do that, from everything from computer logins to surveys to check ins. Just again, the point is not for the data to be perfect. The point is to get a sense of what are where are these buildings generally at in terms of the utilization. And then you can drill down for the ones that are at a low number and figure out what's going on here.
▶ 0:49:22Should we get rid of this space? >> I know it's one of the challenges in this report is that agencies don't want to share space. Why is that. >> cultural reticence? It's really not acceptable. But it is. It is a mindset in some cases where this is my space, this defines the agency and other agencies do other like, for instance, geo army corps of engineers headquarters is that geo building agencies can share space, sub agencies can share space. It's just a change in mindset. >> one of the agencies I'm particularly concerned with is the usda.
▶ 0:49:50I know they're moving some of their offices to kansas city. They're looking at property, I think have already made some contracts on lease in kansas city proper. I talked with the undersecretary about that when we were in saint louis at the usda building there, um, usda building. One of the buildings, uh, is up for sale here in washington, dc. How is that sale going? >> so I don't know how the sale is going. We don't have current information.
▶ 0:50:20I know it is up for sale, and that will be a major property based on its location for gsa to market. Um, I don't know the current status. >> is it reasonable to think that that building is dilapidated as it is with windows rotting out, that it would be torn down or revitalized for some other purpose? >> it depends on the price and what the market comes back with. >> all right. Thank you, sir, I yield back. >> thank you. Mr. chair now recognizes Mr. bishop for five minutes. Thank you. Um.
▶ 0:50:49>> I was interested in the south building of usda also, uh, I kind of want to get your thoughts on the government's decision to sell it rather than to retain it. Uh, is it possible that, uh, you can get the reasonable asking price, considering the overdue maintenance and the condition that it's in? Uh, does gsa typically take into account the unique and desirable location?
▶ 0:51:17Like in this case, it's proximity to the national mall and other federal buildings. Uh, do they take that into consideration when deciding to permanently relinquish holdings? They. And if, for example, the next administration decides to bring usda workers back to the region, how would selling the property impact future efforts to. Provide space for those that may come back in the future?
▶ 0:51:44>> well, if you do relocate staff back to dc, obviously, if you don't have the building anymore, that's going to be a challenge. You're going to have to find another solution somewhere in the area, whether owned or leased. But it is a large workforce. So if you made the move back, uh, it would take investment of funds and some time. >> obviously, uh, maintaining a building that is not occupied, uh, not getting full use is expensive. So I understand the balancing that has to take place.
▶ 0:52:14Uh, however, uh, when we are relocating workers, uh, it would seem to me that we ought to consider, uh, renovating and utilizing space that we have rather than building new space if it's at all possible. And of course, that's an excellent location. It's a very prominent location and its historic, uh, and of course, the department of agriculture, I think is the oldest federal agency that we have.
▶ 0:52:42And, uh, its position on the mall, uh, probably should be, uh, maintained. Uh, so I'm sad to see the disposition of the south building. Uh, fortunately, the main building is still going to be there, but, uh, I'm just wondering whether or not, uh, we're being penny wise and pound foolish with all of the, uh.
▶ 0:53:06The, the, uh, selling the sales of all of these federal properties. >> so you need to have a plan. It has to be disposing of properties in a timely manner is important. And it's been a problem for a long time that disposals take forever, but you still have to balance it with appropriate planning. What's our strategy for this agency? What do they need and what is the condition of the facility we have versus other space? We could either build or more likely lease.
▶ 0:53:36And that really should go on across all the agencies for all their portfolios, including usda. >> okay, so how, how are you going to be able to deal with, uh, the deferred maintenance that has been, uh, in effect for such a long time? Because I know there are many more properties than just the ones that are up for sale. All of them seem to be suffering from deferred maintenance. Uh, how, how are you going to address that? Uh, in the near term?
▶ 0:54:08>> so it's a big problem. And in the near term, there may not be a perfect solution. I'd say in the near term it's about prioritizing, uh, gsa using facility condition assessments of the buildings they control to identify what are the highest priority items, which are the buildings and the worst day of appear that we intend to keep and investing the money in there for facilities where the liability is so high, particularly those where they're already underused, taking penciling it out and say, does it make sense for us to hold this building or should we dispose of it, getting it down the pipeline?
▶ 0:54:36Um, the other actions you can take are you can congress could provide more funding, but I don't think at the end of the day, more funding is going to fundamentally solve this problem. We have a lot of old aging buildings that have large liabilities. So some of it can be improved. Annual maintenance can be improved in these buildings with more funding. But the fundamental dynamic of older, underutilized buildings is still there. >> sometimes the the tenants don't get the best value for their dollar. Uh, I can speak for that personally.
▶ 0:55:06I had a congressional office that was located in a gsa controlled building, one of the federal courthouses, and it was not very well maintained. And of course, we found it much more economical and, uh, beneficial to locate to private, uh, property. Property. >> well, that's an example of the calculus that agencies should be making, just like your office did. Is it to our benefit to be in this location or not?
▶ 0:55:34In terms of and is the property being maintained sufficiently? I think it points to the problem of, um, there is there's only so many resources to go around. These buildings are old and aging, and you can prioritize maintenance to improve certain facilities. And certainly for the assets you plan to hold for the long term, those are the facilities to invest in to consolidate in other properties. They've passed their useful lives. It would be more efficient to either go into other states, consolidate into other federally owned space, or to lease in those conditions. >> my time has expired.
▶ 0:56:06>> thank you, Mr. bishop. Uh, obviously with the interest that's been shown, we want to continue on and go to the second round. I want to, uh, talk about something that you had brought up before, I believe to miss henson's question in do we have when you said there's different variations of 5 to 10 and 20 year lease, do we do that in a way that it's a lease to own or a turnkey operation? >> so there have been some examples of that where there is a lease to own, like, for instance, the department of transportation headquarters building.
▶ 0:56:35Yes, that started out as a leased facility. And then, uh, the federal government exercised its option to buy. So it's now a federally owned property. So it does happen. It's not a it is not a all the time. It's not. >> something you. >> look for, right? It's not. >> something you look for. You're trying to turn over our inventory, sell off the other things and do get new buildings. >> I mean, you could that could be one of the tools in your toolbox. It's not the only tool in your toolbox, but one could be.
▶ 0:57:02So the advantage potentially of a lease to own option would be that space might have been better maintained because your lease payment, your rent payment is covering the operations and maintenance is being maintained by a private sector company that there's contract requirements for. So when you're buying it, you have one, you've been renting it. So you have a very good sense of the product you're getting. And it might have been better maintained than, say, an old federal facility. The downside is you've made all those lease payments over the years. And so it may not pencil out depending on when you get to it.
▶ 0:57:30You also have to have the funding to actually purchase it at that point. And it can be a big cost. So there are trade offs. >> speaking of trade offs now, do you do an assessment of the you're basically triaging old buildings. So do you do an assessment of whether it's worth the dollars to fix the old building, or are you trying to move around the maintenance dollars to say, keep those that you can in habitable or the best condition and start to write off those ones that are beyond repair or. >> so gsa certainly does.
▶ 0:57:56Gsa certainly does, uh, with limited funds. They do those kind of condition assessments for the buildings. They look at how those are being used, which properties are long term holds that you would want to invest the most resources in and which properties are not long term holds properties you're probably going to dispose of. You'd still need to do. There's still a cost. You can't just leave a building by itself. You still have to maintain it to use it to make it operational, but you're probably not going to do major renovations if you're planning to get rid of a building.
▶ 0:58:26>> and you were talking about the consolidation of putting two agencies in one building, some don't like it. I know everybody's involved in a turf war. The theory has to be who cares? You know, it's our taxpayer money. And these people need to understand consolidation and fix the problems that we have instead of having a half used building just because of egos. So in that light, has there been an assessment done on space necessary and consolidation?
▶ 0:58:52>> so they're under the use of acs for all the headquarters locations in the national capital region. Gsa and omb are supposed to provide a report in days, uh, that is identifying plans for those buildings. In terms of what are some consolidation opportunities? What are buildings we would hold as a federal government? Um, and I think that's important because there are reasons why agencies might need their own space if they have a special national security mission specific functions where you need your own space. But if you're doing general office work, you can have your own floor, right?
▶ 0:59:22You can have your own designated space where it's still your agency, but you're in the building. And quite frankly, once you get outside of the national capital region, this is how federal buildings operate. You don't have, generally speaking, single tenant federal office buildings in downtowns across the country. You have epa's there and opm's there, and whatever other agencies you can think of are in the same building, just delineated offices. >> I love that concept because I don't think they all have to be consolidated here.
▶ 0:59:48When my time on interior, we moved, uh, bureau of land management out to grand junction, colorado, because all the people out west who use the blm the most were flying into dc for no valid reason other than coming to dc because they didn't want to give up their space here. Even though they serve people, majority 90 some percent of their work is out west. Uh, unfortunately last administration then you know, went gave up that lease and moved them back here, uh, when it was over.
▶ 1:00:15But I've always been a fan of the idea that we're going to take these back. The department of agriculture doesn't necessarily need to be in dc. Uh, the different agencies that could move outside and be a boon to other areas of our country and make it a better facility by doing that. Because as brought up before, too, some of the costs are going to be less expensive to be in washington, dc. But, uh, let's get back to yours. I got one last one. I'll try to squeeze in here. You talk about some of these buildings that need to be torn down.
▶ 1:00:44What can we do to help you, and what problems are you seeing out there? Is it a zoning issue? Is it a local issue that you're having problem with trying to, uh, do the destruction to get the property necessary for resale? >> well, so it would depend on gsa's evaluation of individual properties. So in general, they are not demolishing at least large scale buildings. You might have smaller, you know, very small structures that the demolishing there could be some locations where they determine that's worthwhile. I think the challenges they would run into are cost, right?
▶ 1:01:13Having the funding, it takes upfront funding to do that. So having the money to demolish it, there would certainly be environmental concerns. Environment. They have to go through an environmental remediation process, potentially historic preservation depending on the quality of the building. So there are some hurdles there that you go through as part of that process. Generally speaking, gsa is not demolishing, uh, these larger buildings. They are putting them for sale. And that's a matter of what's the price that the market will take it on without demolishing for that location and also penciling out.
▶ 1:01:43Does it make more sense for the federal government just to sell it at a lower price than spend the money to demolish and then sell? >> and just one last one you brought up, where do those funds go? They go back to you for the maintenance, or do they go back to the treasury? >> so if if a property is sold. Yes. So the the proceeds, it depends on the location. Generally funds go back to the treasury, but some agencies have retained authority to retain the funds.
▶ 1:02:09I'm not sure in gsa's case if they go back to the federal building fund or not. Do we know we can follow up on that one? >> no worries. Thank you. I apologize for going over. Now recognize Mr. hoyer for his questions. >> no apologies necessary. The chairman ought to have that opportunity to do that. Um, let me ask you a question. Obviously, uh, the overwhelming majority of federal employees work outside of the washington, dc area.
▶ 1:02:37Can you tell me the percentage of space that the federal government owns that is outside the washington, dc area as opposed to in. >> so I know when we did our our review of the 24 cfo act agency headquarters, which is not all the space in dc, but it was, uh, north of 20,000,000ft. And then overall for gsa alone, gsa has north of 350,000,000ft. And then the federal government beyond that has even more.
▶ 1:03:08>> so make sure I understand 20 million in the washington metropolitan. >> for the. 24 cfo act agency headquarters. So that's a lower number than is the reality because you have other headquarters here. Beyond that. >> you estimate because you said 370. >> 360 million or so for gsa outside owned and leased. Well, it's 360 million overall for gsa owned and leased. Then you have 20 million or so. That is in the dc area for just those 24 headquarters agencies. There's going to be more space because there's more than just headquarters in dc. That number is low.
▶ 1:03:37But if you're just looking at that math and then that 360 is just gsa. So you're not talking about all the other agencies that have real property that they own and control. So you are looking at a large, uh, infrastructure outside of the national. >> give me a ballpark, but educated estimate. Are we talking seven, 8 to 1? >> let me get back with you. I won't give you a wrong number, but it's a significant difference. There'd be a lot outside of dc, especially if you're considering dod and other structures that just.
▶ 1:04:08It's going to be significant. >> thank you, Mr. chairman. I would like to at this time ask that this report be included in the record. At this time, the gsa is not consistently addressing deficient security fixes at gsa control. So and I'd like to include two articles as well with reference to the underlying report. Absolutely. Thank you very much, Mr. chairman. Um, I've done that. The use of act, is that what you were referring to?
▶ 1:04:38The use it act? >> yes, exactly. It was part of the water resources and development act last. >> who signed that bill? >> uh, president biden. >> president biden signed that. >> president biden signed it. >> and I think we all voted for the bill. It was pretty unanimous. >> I think it was. >> it passed. >> by members. >> yeah, it's a smart thing to do. Again, I reiterate, Mr. chairman, as you know, I've said in terms of numbers, employees, I represent 77,000. But I tell them as well.
▶ 1:05:03I tell the unions, I tell what I want is a right size, not a more or less, but the right size. So do you have, uh, any which is a related issue? Um.
▶ 1:05:22Recommendation on what you started your, uh, testimony with because I know I spent a lot of time talking to the former director of gsa under president biden about a, some funding mechanism will, which will assure both the ability to construct needed buildings and to maintain buildings.
▶ 1:05:43Every government at every level and every household in america defers maintenance until the roof goes. Uh, and then they have to pay more. And that's what we do. It's just everybody does it because why it doesn't have a today effect. And so you say, well, we'll do that next year.
▶ 1:06:06Um, and I would like you to submit to the committee your opinion on what the best you mentioned in your testimony, the best way to prepare ourselves to fund and implement maintenance and building in the most efficient way possible. And let me say, I'm a strong supporter of the of you use it.
▶ 1:06:34And I frankly, I went to some buildings which had very small numbers of people in it. And I thought to myself, you know, what's going on here? Uh, and, uh, we ought to make sure that we have space available in some swing space available, but not so much that it's not utilized and it's just gathering dust. So I'm a strong supporter of that and look forward to getting your recommendations on how best to do that.
▶ 1:07:03Thank you very much. Thank you, Mr. chairman. >> thank you. Mr. hoyer. Now recognized miss hansen. >> thank you, Mr. chairman. Um, I mentioned I wanted to kind of follow up on some security questions and, um, specific to you, and I'm also looking forward to seeing what comes out of these user reports, um, and seeing where we can find government agencies that can collaborate and to our ranking members point, make sure we're utilizing all that space effectively.
▶ 1:07:29Um, it's about obviously getting these people back into the office, making sure they're working collaboratively. Um, as we discussed in our hearing yesterday, um, and making sure that we have the proper, um, utilized space in our federal buildings. But so when we're talking about not just using both federal agencies, but potentially private sector partnerships as well, um, for some of that space and local entities. Um, have you considered, uh, at gao, some of the potential security concerns with maybe some of those proposals costs with the shared property?
▶ 1:07:57Um, if we do engage with private sector or some of those other local entities. >> so it's a consideration, you would definitely have to work it out as part of the agreement being very clear in your contract, who's responsible for what, including security and ensuring you have an appropriate level of security. >> okay. But so that is being considered as you have those conversations. >> so this is something gsa would take into account as they're going through those arrangements. >> are there certain agencies that you think would be better suited for those kinds of public private partnerships in terms of the space, or do you think it applies universally?
▶ 1:08:27>> I don't think it applies universally. I think it depends on the mission of the specific agency and the subagencies you're talking about. And even within, for instance, dod, which obviously has the national security mission, there may be aspects within it offices that could share space and others where you definitely wouldn't want to. >> so if it's in the interest of protecting national security, obviously we need to be very careful about who we're partnering with and who could potentially access that lease space. And I certainly agree there. We have to do everything we can to to make sure, again, it applies to the right agencies.
▶ 1:08:54Uh, from your testimony, it seems though, that this is something, you know, in terms of the proposals for potentially sharing space with private sector that gao has been considering for more than a decade, I think, since 2014. So, um, have you heard from gsa on why they have not more aggressively pursued this? Uh, do you think it goes back to what you said earlier? I think in response to Mr. alford's question of, well, this is a turf battle, right? And these agencies want to protect their own turf. Where do you think that lies? >> I don't think it's a turf battle when it comes to gsa.
▶ 1:09:23They have tried some of these alternative financing mechanisms in the past. Um there are some limited examples. I think it's a challenge, uh, figuring out the funding piece, figuring out the scorekeeping piece of this can be a challenge too. So I think these are still mechanisms worth exploring in gsa should, but it's going to depend again, on the facts and circumstances and finding the right private sector partner in the right location. So it's one of those things they should have their ears open to. I suspect they do have their ears open too, but it's not going to work in every situation. >> okay. Thank you. That's all I had. Thank you, Mr. chairman.
▶ 1:09:54>> thank you very much, miss hansen. Now, recognize Mr. ivy for five minutes. >> thank you, Mr. chair. I'm just curious, just based on some of the questions and answers from a moment ago. So I know in the private sector, after the move towards remote work, there were a lot of private sector companies that decided to stay on that track, and they brought a lot of people back to work. But some, you know, 25 to 35% of their employees frequently work remotely.
▶ 1:10:22And I know one of the reasons they did that was because they could reduce the size of the office space that they needed. Um, and so from a private sector standpoint, they thought that they could get savings actually from remote work. Now, I don't want to get into the debate about, you know, what's more efficient or not. You know, I think generally speaking, I'd pick microsoft over the federal government, but we'll set that to the side for the moment.
▶ 1:10:48But is that something that's calculated in because my recollection was that there were some buildings that were federal buildings that were being built, moving towards moving away from the concept of every employee has an office of his or her own to shared office space, or what was it called, a hotel. Um, it what's the status of that now and how the federal government is making these decisions. >> so it's always a consideration of how so desk sharing. Hoteling.
▶ 1:11:16That is an important tool to get to the utilization rates required under the user act, especially for staff who, even if they're coming in every day, some of people's jobs are not in that building every day. And so you don't need to have that one person if they're in one day a week because they're on site for days, you don't need to have them have their own office. You can share it across folks. So those still make sense. Now.
▶ 1:11:40They make more sense when you have a higher level of telework, because then you have a larger opportunity to do that type of desk sharing. But it still makes sense today, even with a return to office framework, because again, many workers are not in that location every day based on their jobs. Even if they're in office, they're in office might be a construction site, a testing site or things like that.
▶ 1:11:59>> well, I just just thinking it through and, you know, I'm not even sure what my, my final position on this would be, but it does occur to me that there's a fluctuation right now and, you know, sort of political considerations or policy judgments, not to be judgmental about it, but about whether people should be back in the office or not. But then you make relatively long term decisions that are not susceptible to this policy choice about how many offices you're going to have per individual employee.
▶ 1:12:29And so how you balance that out. >> it is. >> challenging why you get paid the big bucks, right? >> it is challenging for for gsa to do that for any agency that has real property to do that, you're making decisions based on the policy you have at the time you're making the decision. Um, it's one of the reasons to consider particularly leasing in some situations where you have uncertainty. Leasing for at least the short term can make sense.
▶ 1:12:52If you're not sure what your requirements are going to be long term, if you have a longer sense of this is the way we're going long term, we need this space on a more permanent basis than owning tends to make more sense. Uh, so it is a challenge. It is a challenge, especially if you're talking about potentially moving back and forth to what your space needs are.
▶ 1:13:10But either way, whether you're talking about a more telework model or a more in-office model, you should still be looking at things like desk sharing, like how much space we use and how much extra are in some of these buildings that can account for both full and office or a telework model, just, you know, working through the system. So it's a challenge. >> all right. And then new topic.
▶ 1:13:31Um, previous comments were along the lines of if you move things out of washington dc or the dc area to other parts of the country, it costs less. And so it's easier to put people there in the standard of living as well. That's not automatically true.
▶ 1:13:47In fact, I think with respect to the agriculture discussions, with respect to, uh, the agriculture research center, one of the findings was that, um, actually it's more expensive to move people to some of the sites that they chose and than it is to leave them in prince george's county, which has, um, a less expensive, uh, standard than, uh, you know, cost from the standpoint of, uh, rent and the like than dc and other parts of the dc area.
▶ 1:14:14So I hope that'll be part of the consideration as those evaluations are done. >> and there are multiple costs. I mean, real property is one cost. You also have to build in the cost of moving relocating because there's a cost to that as well. Um, so you really for even it's again, facts and circumstances, you have to pencil out for the project. And then even I would say more important than real property, it is a significant cost is a concern, but it's looking at the macro picture of labor costs, looking at, uh, mission impacts.
▶ 1:14:42Those are all considerations that are going to depend on the individual relocation. >> yeah. And a transfer of employees as well would be another big one. I think the last time ag did one of these, like half of the staff didn't move to the new sites, uh, because of the challenges of, you know, having to relocate and the like, but I'll leave it at that. Um, thank you, Mr. chairman. Thank you though, especially sir, for coming in and testify for two years in a row. We appreciate it. >> certainly do.
▶ 1:15:07And the distinguished ranking member might have a question left in the. He wanted to address. >> this is not, I understand, directly in your purview, because you deal with infrastructure. But I think we really do need good information on what. Um. What do we call it working at home. That's not the phrase teleworking.
▶ 1:15:34Um, what gao some branch of gao ought to tell us what was the productivity impact of doing that? Because a lot of private sector does it because it's more productive and they save on cost of, uh, you know, headquarters or office space.
▶ 1:16:00Um, and I don't know whether gao has done such a study, but we hear a lot of debate about it. And there's a lot of difference of opinion how effective that is. Um, and the average supervisor, if he doesn't see the person believes that somehow they're not working as productively, that may or may not be so I don't know, but I would ask you to see if somebody in your shop has, whether they've done a study of that and whether they can give an answer to that. >> so so I can answer that.
▶ 1:16:29We have not not my group specifically, but gao has taken a look at telework productivity, both, I believe, in the private sector and in federal agencies. I'm happy to connect them with your staff and provide the relevant information. >> excellent. Thank you very much. Thank you, Mr. chairman. >> thank you, Mr. hoyer. And, uh, director moroni, you've been a treasurer of bad news for us. Uh. Sorry and certainly appreciate that. And, uh, as ranking member hoyer had brought up, this is a wonderful hearing.
▶ 1:16:59Uh, be able to have this kind of interchange with you. Uh, so is it before we clock out here. I wanted to give you an opportunity. Is there something you would ask congress for that could help you do this job better? >> so I think a few things that congress could do that would help the momentum here. Uh, one provides strong oversight of the implementation of the used act. Do we get the reporting? What's the quality of the reported data from the executive branch? And then is there follow through.
▶ 1:17:28The act requires, after a two year period for any buildings that are under any space, that's under 60% utilization for omb, gsa to work with the agency to reduce that space, making sure that actually happens. So that's one oversight of the use of act implementation. Uh, another would be for congress to take a look at the prospectus threshold. That's a particular issue with gsa right now. It's about $4 million.
▶ 1:17:51Um, that captures a number of repair projects that are not, they're not new buildings, not huge. When you're talking about a huge building that you have to say, replace elevators in, you're going to pass $4 million. And the prospectus process provides important oversight, but it can also add time to the project, which ultimately adds costs.
▶ 1:18:09So just taking a look at that, it's obviously a policy choice because there's a balance here between the flexibility you give the agencies and oversight, but something at least to consider that might smooth, smooth the works, I'd say, considering how to designate funding in some way for optimization efforts, where you are both providing funding specifically to get properties ready for disposal so you can move those quicker, have that funding ready, but also ensuring that funding is going to those priority properties that you're going to
▶ 1:18:39Hold so that those properties don't degrade over time. And then we're not talking five years from now about those holes being in bad shape. Um, those are those are important things. They're challenging things. But I think those are areas where congress could definitely provide some value.
▶ 1:18:56And, um, I guess the last one I would highlight, I don't think it makes as significant a difference, but taking a look as a congress authorizing committees in particular at the disposal process itself, the steps involved, which are important steps, uh, involving environmental remediation, historic preservation, considering if state and local agencies could use the building. I'm not saying those are bad steps, but they do at some time. It's not the main reason why disposals are slow, but it is a reason. And taking a look. Do those make sense in all cases?
▶ 1:19:24Are there some flexibilities that could be potentially given there, at least in specific circumstances? Again, it's a policy choice. I can't tell you what way to go there, but at least it's worth taking a look at. >> the great. All those are great suggestions and hopefully we can get around to following through on them and make both of our jobs easier. Uh, one, you just I don't want to, uh, keep going, but you just brought up something about. So what you're saying is that say we have building x, we should tie the maintenance funds for building x to that building versus giving them into a central pot. Well.
▶ 1:19:55>> you could still keep it through the federal buildings fund and just say we're appropriating at a higher level based on what gsa estimates of what it costs for that building to be. I mean, I think a key distinction here, just theoretical. Yeah. When you're leasing space, the rental payment includes operating and maintaining that space. So you're just playing a single fee, just like if you're renting an apartment, right? You're not taking care of generally the maintenance of that space. So that that's built in with own space, with federally owned space that's not as built in. In theory.
▶ 1:20:21The federal buildings fund is there to provide that operation, maintenance costs for gsa owned buildings and other agencies get appropriations from their subcommittees to do that. But it's easier there for that to be deprioritized. And that's where you can get into this problem of building's age. It's reality. And to your point, Mr. ranking member, it's also something not all deferred maintenance is created the same. Some things it's fine to defer and other things you're creating a big and potentially expensive problem for yourself down the road.
▶ 1:20:49Being able to create some mechanism where when you build a new property or you're just retaining a hold property going forward and better ensuring that the needed operations and maintenance funds for that building for that year go to that building. So you're keeping up with it consistently over time as opposed to, you know, some years, maybe there's enough, other years there's not. And so things get put off and it gets worse over time. >> fair enough, I hear you. >> just there.
▶ 1:21:17>> like the figure I have and you, you may know, is they're spending $250 million per year on maintenance of the fbi building alone. And that's not for it. It just maintains it from getting worse. It doesn't make it better. Right. >> operation maintenance long term is going to way be more expensive than actually the cost of building that facility.
▶ 1:21:42If you're talking about a building you're holding for 30, 40 years, the amount you spend on operation and maintenance is just going to dwarf it over time, which is why it's important to maintain it. It's expensive, but if you don't, then that bill gets worse and worse. And more importantly, you lose the value of the asset both if you are going to dispose of it. But for the mission, which is ultimately what this is all for, right? We don't have buildings to have buildings. We have buildings to serve the mission of the agencies and the american taxpayer. And so that's why it matters. >> and with that, I know all good things must come to an end.
▶ 1:22:12And I'd like to thank you, Mr. moroni, for being here today. There may be some members who would like to submit additional questions and please, for the record, submit any questions for the record to the subcommittee within the next seven days. And the subcommittee now stands adjourned.