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Plan would expedite sale of surplus federal property

The White House has identified 14,000 properties it wants to get rid of, including some on foreign soil. But red tape makes the sale of government property a slow and painful process.

March 20, 2011|By Lew Sichelman

Reporting from Washington— — With apologies to Donald Trump fans, Uncle Sam is far and away the country's largest real estate mogul, with something like 1.2 million individual properties worth hundreds of billions of dollars. But if the Obama administration has its way, some of them will soon find their way into private hands.

The White House has identified 14,000 properties it wants to get rid of, including "a couple of thousand" on foreign soil. And that's only a portion of the nearly 45,500 buildings identified by the Government Accountability Office that are either underutilized or unused and also could be sold.

The only trouble is that the federal government is, well, the federal government. It is bound by red tape. In some cases, more than 20 requirements have to be met to sell a federal property. Furthermore, the agencies that control the properties don't have the money they need to sell them.

But even if they had the cash to cover the short-term costs, and even if there were just a few simple guidelines to be met, they would have to contend with politics. Although local leaders love to preside at ribbon cuttings, they are often loath to back the elimination of federal properties, which frequently are the physical face of Uncle Sam in their communities.

That's why, as part of his fiscal 2012 budget, President Obama has proposed creating an independent board of experts that will expedite the disposal of unneeded properties and identify opportunities to consolidate agency offices.

The proposed Civilian Property Realignment Board is loosely based on the accomplishments of the Defense Department's Base Realignment and Closure Commission, the so-called BRAC initiative that was successful in identifying military installations for termination.

The board would present its recommendations to Congress on bundles of properties to be sold. Lawmakers would have a short window — say, 45 days — to vote yes or no, or not vote at all. If they don't act, then the board's recommendations would be considered a done deal.

"This is a proven approach," said Jeffrey Zients, chief performance officer and deputy director for management at the Office of Management and Budget, at a White House press briefing this month. "BRAC proves that having an independent board of experts can push through political gridlock."

The administration says taxpayers can save as much as $15 billion over the next three years by selling off unneeded real estate in this manner. Consequently, it believes its idea should have bipartisan support.

"Everybody agrees that we shouldn't have real estate that we don't have the need for and that we can save energy and return taxpayer dollars," Zients said. "So we anticipate working closely with both Democrats and Republicans to get this legislation done quickly."

But the administration isn't waiting for Congress to act. Rather, it is "plowing forward," Zients said, by selling properties under the old-fashioned "very painful, slow process."

In the next two months, it expects to announce the sale of two big properties. One is a 1-million-square-foot warehouse and parking lot on 6 acres in Brooklyn, N.Y., and the other comprises five buildings on 75 acres in Fort Worth. Both properties are vacant; the New York facility has been empty for a decade.

But Zients said it would be much easier to sell other surplus properties once the proposed realignment board is in place. "This is a way to streamline the process," he said. "We'll have a much better success rate on getting these properties to market."

The list of surplus properties the government hopes to sell won't be made public until next month at the earliest. But Zients said they were located in downtown city centers, suburban shopping districts and outlying rural areas. Some are worth millions of dollars while others, like surplus supply sheds and outdated Federal Aviation Administration towers, have no value at all.

The federal real estate portfolio includes offices, warehouses, laboratories, hospitals, schools, family housing and vacant land under the control of more than 30 agencies and departments.

In fiscal 2009, according to the Government Accountability Office, the investigative arm of Congress, 24 agencies reported more than 45,000 underutilized buildings, totaling 341 million square feet. Together they cost taxpayers $1.66 billion a year to operate, the GAO said.

In addition, the General Services Administration, often referred to as the federal government's landlord, has nearly 300 excess properties it no longer needs. They encompass about 18 million square feet and are located in 43 states and the District of Columbia. And they cost $93 million a year to run.

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