Administration renews effort to dispose of excess property

Tucked into the appendix of President Barack Obama's fiscal 2010 budget proposal is a provision that would require agencies to begin disposing of excess federal property that the government no longer wants and allow them to reinvest all sales profits into other real estate.

Currently, the general treasury collects all financial proceeds from federal real property disposal, creating little incentive for agencies to spend time and money on the program. Obama's provision would require agencies to use the funds they receive from such sales to maintain and repair their other properties. Earlier this week, Sen. Tom Coburn, R-Okla., tried unsuccessfully to add an amendment to housing legislation that would have allowed agencies to keep 20 percent of their profits from real property sales.

Agencies own 65,594 properties that are underused or not in use, according to data released by Coburn's office. The estimated value of those properties is $83.8 billion, with an annual operating cost of $1.6 billion. The Government Accountability Office has named maintenance of federal real property a high-risk area on its annual list since 2003.

The debate over excess federal property and who benefits from its sale is long-standing. According to the General Services Administration, Congress has made at least half a dozen unsuccessful attempts since 2000 to overhaul the government's federal real property asset management system.

During the Bush administration, some Democrats and Republicans in Congress and White House officials opposed the idea of allowing agencies to keep all the proceeds that were not appropriated for some other purpose from the property sales, according to a source.

The provision in the Obama administration's budget also instructs the Office of Management and Budget to conduct a five-year pilot program to streamline the disposal process, and the General Services Administration to create and maintain a comprehensive central database of agencies' superfluous property assets.

The nonclassified database would include the location of the property; its square footage and acreage, and the building's level of use. Certain information could be excluded if GSA "determines that withholding such information would be in the best interest of the government or the public," the proposal said.

Chief Financial Officer Kathleen Turco said GSA already maintains a real property database for internal purposes. In its fiscal 2010 budget request, the agency requested $1 million to make the site operational to the public.

Turco said the changes would "improve our real property management" and make the system more "efficient and effective."

The language was included in the general governmentwide provisions of the 2010 budget. That section typically is used to refer to matters of law passed by the Congress that could apply to annual appropriations. The administration's provision is similar to 2008 legislation by Rep. Dennis Moore, D-Kansas, that died in the Senate.

Moore said he was grateful that the administration had picked up the issue.

"Holding on to unused properties has serious implications for the American taxpayer, as it costs federal agencies millions of dollars per year to maintain and secure assets that are underutilized or simply unneeded," he said. Thomas Gavin, an OMB spokesman, added that the administration was "taking aspects of the bills that we agree with and urging Congress to move forward with them."

The Bush administration unsuccessfully used the same strategy in its fiscal 2007 budget proposal to move a similar excess property bill.