Reported Savings from Federal Real Estate Initiatives Inconsistent, GAO Finds

Federal agencies did not consistently report cost savings from real estate initiatives taken in response to a June 2010 presidential memorandum intended to spur the disposal of excess property, improvements in energy efficiency and other space consolidation efforts, according to a Government Accountability Office (GAO) report released last week.

Space management initiatives — including consolidating or eliminating leases that were not cost effective — accounted for the largest portion of the $3.8 billion in savings agencies reported through fiscal 2012. Space management accounted for 70 percent of the real estate savings from six agencies — the General Services Administration, and the departments of Agriculture, Energy, Homeland Security, Justice and State.

GAO, however, identified several problems affecting the reliability and transparency of the results. For example, agencies interpreted the guidance from the Office of Management and Budget (OMB) differently.

Agency officials told GAO the guidance was unclear as to whether savings from cost avoidance measures could be reported. Other inconsistencies identified by the congressional watchdog agency included:

  • some agencies did not deduct costs associated with property disposal;
  • agencies made different assumptions as to how many years of avoided operations and maintenance costs to report; and
  • some agencies reported savings from outside the memo’s time frame.

GAO recommended that OMB establish clear standards for reporting savings of real estate initiatives, a move that would improve the reliability of data and help decision-makers better understand the potential savings from new practices in federal property management.

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