General Services Administration:

Better Data and Oversight Needed to Improve Construction Management

GGD-94-145: Published: Jun 27, 1994. Publicly Released: Jun 27, 1994.

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GAO reviewed the General Services Administration's (GSA) management of its building construction and repair program, focusing on: (1) the number and associated costs of contract modifications; (2) the reasons for the modifications; and (3) whether any of the modifications could have been avoided.

GAO found that: (1) GSA has obligated over $1.4 billion for major construction projects in the last 4 years; (2) from fiscal year (FY) 1988 through the first half of FY 1993, 51 percent of new construction contracts exceeded their 5-percent cost growth estimates, and 56 percent of the repair and alteration contracts exceeded their 7-percent cost growth estimates; (3) 43 percent of GSA construction contracts had cost growth of 10 percent or more; (4) GSA officials believed that a large part of the cost growth was due to exercising contract options rather than unanticipated problems; (5) 70 percent of the cost growth on the 12 contracts reviewed was due to design and planning problems; (6) according to GSA officials, design and planning problems occurred because of architect-engineering (A-E) firms' errors and omissions, poor communication between GSA, A-E firms, and tenants, limited GSA design reviews, and changes in tenants' needs and technology; (7) GSA lacks readily available and complete management information for identifying potential problems and evaluating the reasons why changes occur; (8) GSA has not been able to resolve its construction management problems despite 10 years of effort to improve the program; and (9) GSA has taken actions, including a new information system, to improve construction oversight and reduce the number of costly construction modifications.

Recommendations for Executive Action

  1. Status: Closed - Implemented

    Comments: In November 1997, GSA began using two new management information systems -- the Inventory Reporting and Information System (IRIS) and the Project Manager's Toolbox (PMT). IRIS is a management information system with four components, including PMT, that allows management to track construction projects from scope of work to completion and identifies the reasons for cost growth.

    Recommendation: The Administrator of General Services should direct the Commissioner, Public Building Service (PBS), to improve construction program oversight by ensuring that any new management information system provides readily available, complete, and accurate information that will allow systematic analysis of contract cost growth and the reasons why cost growth occurs on all contracts associated with each construction project.

    Agency Affected: General Services Administration

  2. Status: Closed - Implemented

    Comments: In November 1997, GSA began using two new management information systems, IRIS and PMT. IRIS is a management information system with four components, including PMT, that allows management to track construction projects from scope of work to completion and identifies the reasons for cost growth.

    Recommendation: The Administrator of General Services should direct the Commissioner, PBS, to develop criteria for defining an acceptable level of cost growth for all contracts related to new construction, modernization, and repair and alteration projects to measure cost growth, evaluate contract performance, and identify potential problem areas.

    Agency Affected: General Services Administration

  3. Status: Closed - Implemented

    Comments: In November 1997, GSA began using its new management information system, IRIS. IRIS provides GSA with the capability to systematically and periodically evaluate contract changes and identify causes for design and planning problems.

    Recommendation: The Administrator of General Services should direct the Commissioner, PBS, to systematically and periodically evaluate contract changes to identify the causes for design and planning problems, implement approaches for resolving those problems, and develop strategies for strengthening the design and planning process so problems do not recur.

    Agency Affected: General Services Administration

 

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