Mismanaged Federal Properties Cost Taxpayers Billions

NCPA March 4, 2013

According a new House Subcommittee on Government Operations report, mismanagement of federal property is costing taxpayers billions of dollars per year. At a time when the national debt is approaching $17 trillion, American's have a right to know how their money is being spent, says Michal Conger in the Washington Examiner.

• Inefficiency, inaccuracy and underuse are estimated to cost taxpayers at least $1.6 billion each year.
• The issue has been listed high on the Government Accountability Office's (GAO) high-risk series for 10 years.
• Agencies often inaccurately report the condition, value or maintenance costs of their buildings, which creates a wide gap between official estimations and actual costs.

In other cases, dilapidated buildings are reported as being in excellent condition. The variability in reporting does not follow sound data collection practices, according to the Federal Real Property Council.

• These inaccuracies result in excessive reliance on leasing when there are underused federal buildings in the same area.
• The government owns or leases roughly 400,000 buildings and the inaccurate reporting creates overlap that costs agencies millions of dollars.
• Agencies also ignore old buildings because of high maintenance or disposal costs, which ultimately costs taxpayers more money in the long run.

One example is the Department of Agriculture's Agriculture Research Service property in Maryland, which sits on a 7,000-acre property and houses more than 500 buildings. More than 200 of those buildings are vacant, yet there is no plan for them other than to sit vacant.

Across the country, more than 75,000 buildings sit vacant or underutilized. While the GAO oversees the Federal Real Property Council and dictates their reporting standards, it has no authority to enforce any standards on other agencies.  The problem is exacerbated by Congress, which continues to pursue piecemeal answers to the problem instead of comprehensive solutions.

Source: Michal Conger, "Failures in Managing Federal Property Costing Taxpayers Billions," Washington Examiner, February 27, 2013.

GAO: High-Risk Designation Remains due to Persistent Management Challenges