General Services Administration:

Downsizing and Federal Office Space

T-GGD-97-94: Published: Apr 24, 1997. Publicly Released: Apr 24, 1997.

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Bernard L. Ungar
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GAO discussed its July 1995 letter on the General Services Administration's (GSA), the Office of Management and Budget's (OMB), and 10 executive agencies' efforts to identify and manage federal office space that may be unneeded or underutilized after agencies downsize, and GAO's ongoing work on this issue.

GAO noted that: (1) with the loss of 107,000 non-Department of Defense related full-time equivalents (FTE) through downsizing, millions of square feet of costly federal office space could become unneeded or underutilized; (2) GAO's letter recognized that it probably was not possible to save the full cost of all office space associated with FTE reductions because personnel losses could be scattered over multiple locations; (3) however, to provide an indication of the potential savings involved, GAO estimated that the cost of the office space vacated by the 107,000 FTEs at the time to be about $362 million annually; (4) GAO said in 1995 that neither of the two central federal management agencies responsible for space management and budget matters, GSA and OMB, had developed a governmentwide strategy for managing office space reductions resulting from the government's downsizing efforts; (5) GAO reported, however, that both agencies had taken steps to identify and restrain potentially unneeded or underutilized federal office space; (6) finally, GAO's 1995 letter pointed out that 10 executive branch agencies, plus GSA and OMB, had either taken proactive space management approaches or were awaiting on the outcome of other issues prior to beginning specific initiatives; (7) four agencies had developed agencywide space management initiatives; (8) the remaining five agencies had not begun specific space management initiatives related to downsizing because they said they were awaiting the outcome of employee buyouts, agency reorganizations, or legislative initiatives; (9) since GAO's 1995 letter, GSA has taken additional steps that it believes will improve its management in general of government-owned and -leased properties, and that could help in identifying and restraining the amount of unneeded and underutilized federal office space resulting from agency downsizing; (10) GSA officials told GAO that GSA is now formally considering the effects of federal agency downsizing and space reduction plans in its forecast of rent collections, which in large part make up GSA's federal building fund used to fund real property activities; (11) although it is too early to assess the effectiveness of any of these GSA actions, in discussions with OMB staff responsible for reviewing GSA's budget, they told GAO that they believe that actions taken or under way by GSA will position GSA to more effectively manage potentially unneeded and underutilized federal office space that might result from downsizing; and (12) GAO's work updating the space management strategies of the 12 executive branch agencies has also just begun.

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