District Could Get More for Urban Renewal Property, but HUD Debt Will Be Repaid

GGD-82-32: Published: Mar 8, 1982. Publicly Released: Mar 10, 1982.

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GAO was requested to examine selected aspects of the District of Columbia's urban renewal property disposition activity.

The review showed that District urban renewal property sales should generate sufficient revenues to satisfy the remaining indebtedness to the Department of Housing and Urban Development (HUD). However, GAO is not certain that the District is receiving the best possible price for such properties. Sales prices are based on appraised values and are not set through competitive bidding or public auction; awards are made based on design competition and other criteria. The District has no formal procedures for disposing of urban renewal property, although it generally follows HUD guidelines which offer local agencies substantial latitude. GAO did find some instances where HUD guidelines were not followed. The basis for selecting one developer over another is not clear, and the District's records provide little documentation in this regard.

Recommendations for Executive Action

  1. Status: Closed - Implemented

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.

    Recommendation: The Mayor of the District of Columbia should require the Redevelopment Land Agency to formalize and implement procedures for property disposition which provide for documentation of the process of selection and price determination.

    Agency Affected: District of Columbia

  2. Status: Closed - Implemented

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.

    Recommendation: The Mayor of the District of Columbia should require the Redevelopment Land Agency to formalize and implement procedures for property disposition which provide for orderly and complete property disposition files.

    Agency Affected: District of Columbia

  3. Status: Closed - Implemented

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.

    Recommendation: The Mayor of the District of Columbia should require the Redevelopment Land Agency to formalize and implement procedures for property disposition which provide for criteria for developer selection.

    Agency Affected: District of Columbia

  4. Status: Closed - Not Implemented

    Comments: The District plans no action because: (1) public auction would preclude competitive selection; (2) long-term return may be lower; and (3) it believes that it would be difficult to attract quality development proposals if factors other than land value were established as bidding prerequisites. The current deflated office space market makes competitive bidding a less attractive alternative.

    Recommendation: The Mayor of the District of Columbia should require the Redevelopment Land Agency to formalize and implement procedures for property disposition which provide for use of either sealed bids or public auction, within the parameters of the intended uses and restrictions applicable to the property, to determine what buyers are willing to pay.

    Agency Affected: District of Columbia

  5. Status: Closed - Implemented

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.

    Recommendation: The Mayor of the District of Columbia should require the Redevelopment Land Agency to formalize and implement procedures for property disposition which provide for a public record of the reasons a particular developer is selected.

    Agency Affected: District of Columbia

 

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