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entitled 'Smithsonian Institution: Funding Challenges Affect 
Facilities' Conditions and Security, Endangering Collections' which was 
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Report to Congressional Requesters: 

United States Government Accountability Office: 

GAO: 

September 2007: 

Smithsonian Institution: 

Funding Challenges Affect Facilities' Conditions and Security, 
Endangering Collections: 

GAO-07-1127: 

GAO Highlights: 

Highlights of GAO-07-1127, a report to congressional requesters. 

Why GAO Did This Study: 

The Smithsonian Institution (Smithsonian) is the world’s largest museum 
complex and research organization. Its annual operating and capital 
program revenues come from its own private trust fund assets and 
federal appropriations, with the majority of funds for facilities 
coming from federal appropriations. In 2005, GAO reported that the 
Smithsonian’s current funding would not be sufficient to cover its 
estimated $2.3 billion in facilities projects through 2013 and 
recommended that the Smithsonian Board of Regents, its governing body, 
develop and implement a funding plan. As requested, GAO described 
changes in the condition of the Smithsonian’s facilities and estimate 
for project costs since 2005, analyzed the Smithsonian’s steps taken 
and challenges regarding protecting and managing its real property 
portfolio, and assessed the Smithsonian’s efforts to develop and 
implement strategies to fund its facilities’ projects. GAO reviewed 
relevant documents and interviewed officials from the Smithsonian and 
other organizations. 

What GAO Found: 

The Smithsonian has made some facilities improvements since our 2005 
report, but the continued deterioration of many facilities has caused 
further access restrictions and has threatened collections. The 
Smithsonian’s cost estimate for facilities projects has increased to 
$2.5 billion from $2.3 billion in April 2005. For example, a lack of 
temperature and humidity control at National Air and Space Museum 
storage facilities has caused corrosion to historic airplanes and 
increased the cost of restoring these items for exhibit. 

While the Smithsonian follows key security practices to protect its 
assets, it faces challenges related to ensuring that museum and 
facility directors are aware of security information and related to 
funding constraints. Some directors’ lack of awareness of security 
information limits their ability to respond to changes in the security 
of their facilities. Also, some museum and facility directors stated 
that in the absence of more security guards, some cases of vandalism 
and theft have occurred. In addition, the Smithsonian has made 
significant strides in improving its real property portfolio 
management, such as improving its real property data and using 
performance metrics. However, the Smithsonian has omitted privately 
funded projects from its capital plan, making it challenging for the 
Smithsonian and stakeholders to comprehensively assess the funding and 
scope of projects. 

To address GAO’s April 2005 recommendation regarding implementing a 
funding plan for its facilities projects, the Board of Regents created 
an ad-hoc committee, which, after reviewing nine options, requested 
increased federal funding. We found that some of the Smithsonian’s 
evaluations of the nine funding options were limited in that they did 
not always provide complete analysis, fully explain specific 
assumptions, or benchmark with other organizations. Also, some options 
were dismissed because independently they would not generate enough 
revenue, but the evaluations do not consider combining options to 
increase revenues. 

Figure: Facilities Problems Include Leaks in the National Zoological 
Park's Sea Lion Pool and the Roof of the National Museum of African 
Art: 

[See PDF for image] 

Sources (left to right): GAO and Smithsonian Institution. 

[End of figure] 

What GAO Recommends: 

GAO recommends that the Smithsonian (1) increase awareness of security 
issues; (2) include privately funded projects in its capital plan, and 
(3) comprehensively analyze funding options and report to Congress and 
the Office of Management and Budget on a funding strategy. The 
Smithsonian concurred with the report’s recommendations. 

To view the full product, including the scope and methodology, click on 
GAO-07-1127. For more information, contact Mark L. Goldstein at (202) 
512-2834 or goldsteinm@gao.gov. 

[End of section] 

Contents: 

Letter: 

Results in Brief: 

Background: 

Despite Some Improvements, Deteriorating Facilities Have Caused Further 
Problems, and Cost Estimate for Facilities Projects Has Increased: 

The Smithsonian Follows Many Key Security Practices to Protect Its 
Assets but Faces Communication and Funding Challenges: 

The Smithsonian Has Taken Steps to Improve Real Property Portfolio 
Management but Faces Challenges Related to Funding Constraints and Its 
Capital Plan: 

The Smithsonian Has Taken Some Steps to Develop and Implement Funding 
Strategies, but Its Evaluation of Proposed Alternatives Has Been 
Limited: 

Conclusions: 

Recommendations for Executive Action: 

Agency Comments and Our Evaluation: 

Appendix I: Scope and Methodology: 

Appendix II: Smithsonian's Efforts to Implement Key Security Practices: 

Appendix III: Comments from the Smithsonian Institution: 

GAO Comments: 

Appendix IV: GAO Contact and Staff Acknowledgments: 

Tables: 

Table 1: Buildings Disposed of by the Smithsonian Since 2005, Including 
Elements of Decision and Proceeds, as Described by Smithsonian 
Officials: 

Table 2: Smithsonian Facilities Capital and Maintenance Appropriations, 
Fiscal Years 2002-2007: 

Table 3: Funding and Total Cost of Smithsonian Capital Projects That 
Have Received Private Funds for Capital Costs, Fiscal Years 2002-2007: 

Table 4: Nine Funding Options Evaluated by the Ad-Hoc Committee on 
Facilities Revitalization: 

Figures: 

Figure 1: Location of Smithsonian Institution Owned and Leased 
Facilities: 

Figure 2: Growth in Major Facilities Owned by the Smithsonian 
Institution, in Square Feet: 

Figure 3: Key Security Practices in Facility Protection: 

Figure 4: Smithsonian Operating Revenue, Fiscal Year 2006: 

Figure 5: Obsolete Electrical Systems at the National Air and Space 
Museum: 

Figure 6: Plastic Sheeting Covers Native American Boats at the Cultural 
Resources Center to Prevent Water Damage: 

Figure 7: Plastic Sheeting Put Up to Protect Collection Items from 
Water Damage in a Storage Area of the Quadrangle Complex: 

Figure 8: The National Zoo's Invertebrate House, Located at the Back of 
the Reptile Discovery Center: 

Figure 9: Ape House Exhibit at the National Zoo: 

Figure 10: Sea Lion Pool at the National Zoo: 

Figure 11: Leaking Skylight over the Museum of African Art: 

Figure 12: Security Officer Levels at Smithsonian Museums and 
Facilities, 2003 Compared with 2007: 

Figure 13: Timeline of the Ad-Hoc Committee on Facilities 
Revitalization Key Events: 

Figure 14: Closing All Smithsonian Museums on the National Mall for 3 
Days a Week: 

Abbreviations: 

Air and Space Museum: National Air and Space Museum: 

American Art Museum: Smithsonian American Art Museum: 

Board of Regents: Smithsonian Board of Regents: 

CCTV: closed circuit television cameras: 

Cooper-Hewitt Museum: Cooper-Hewitt National Design Museum: 

FEMA: Federal Emergency Management Agency: 

Forest Service: Department of Agriculture's Forest Service: 

Freer Gallery: Freer Gallery of Art: 

FRPC: Federal Real Property Council: 

IRC: Independent Review Committee: 

ISC: Interagency Security Committee: 

MOMA: Museum of Modern Art: 

Museum of African American: National Museum of African: 

History and Culture: American History and Culture: 

Museum of African Art: National Museum of African Art: 

Museum of American History: National Museum of American History Kenneth 
E. Behring Center: 

Museum of Natural History: National Museum of Natural History: 

Museum of the American Indian: National Museum of the American Indian: 

NAPA: National Academy of Public Administration: 

National Zoo: National Zoological Park: 

NHPA: National Historic Preservation Act: 

NJTTF: National Joint Terrorism Task Force: 

NPS: National Park Service: 

OFEO: Office of Facilities Engineering and Operations: 

OMB: Office of Management and Budget: 

OPS: Office of Protection Services Portrait Gallery National Portrait 
Gallery: 

RCM: reliability centered maintenance: 

Reynolds Center: Donald W. Reynolds Center for American Art and 
Portraiture: 

Sackler Gallery: Arthur M. Sackler Gallery: 

Smithsonian: Smithsonian Institution: 

Udvar-Hazy Center: National Air and Space Museum Steven F. Udvar-Hazy 
Center: 

United States Government Accountability Office: 

Washington, DC 20548: 

September 28, 2007: 

The Honorable Dianne Feinstein: 
Chairman: 
Committee on Rules and Administration: United States Senate: 

The Honorable Norman Dicks: 
Chairman: 
The Honorable Todd Tiahrt: 
Ranking Minority Member: 
Subcommittee on Interior, Environment, and Related Agencies: Committee 
on Appropriations: 
House of Representatives: 

The Smithsonian Institution (Smithsonian) has been referred to as 
America's museum, as its museums hold and provide access to 
irreplaceable national collections in American and natural history, 
art, and other areas. The act establishing the Smithsonian in 1846 
provided, among other things, that the business of the Smithsonian be 
conducted by a board of regents. Since its beginning, the Smithsonian 
has evolved into the world's largest museum complex and research 
organization; two of its museums on the National Mall in Washington, 
D.C., are the most visited in the world. The Smithsonian has 19 museums 
and galleries, 9 science centers, a zoological park, and various other 
facilities it uses to accomplish its mission: "the increase and 
diffusion of knowledge among men." In recent years, the National 
Academy of Public Administration (NAPA), the Smithsonian, and we have 
reported on the deterioration of the Smithsonian's facilities and the 
threat posed by this deterioration to the Smithsonian's collections. 
For example, in April 2005, we reported that the failing condition and 
closure of the Smithsonian's 1881 Arts and Industries building on the 
National Mall was the most significant example of a broad decline in 
the condition of the Smithsonian's facility portfolio.[Footnote 1] 
Moreover, we reported that structural deterioration and failing systems 
in Smithsonian museums and other facilities presented serious long-term 
risks to the Smithsonian's collections. A 2001 report by NAPA found 
that prior to 2000, the Smithsonian had underestimated its 
revitalization needs, which were significantly larger than were 
identified in its budget requests. 

The Smithsonian's annual operating and capital program revenues come 
from its own private trust fund assets and federal appropriations; 
however, the majority of funds for facilities come from the 
Smithsonian's federal appropriations. Six percent of the Smithsonian's 
annual operating revenue--about $58.2 million in fiscal year 2006-- 
comes from unrestricted private funds, and the Smithsonian's Board of 
Regents has the authority to spend these unrestricted private funds for 
various purposes, including facilities.[Footnote 2] We reported in 
April 2005 that the Smithsonian's trust fund assets and federal 
appropriations at current levels would not be sufficient to cover the 
Smithsonian's estimated $2.3 billion in revitalization, construction, 
and maintenance projects--which include security-related projects--from 
2005 through 2013. Given this significant funding challenge, we 
recommended that the Smithsonian Board of Regents (Board of Regents) 
develop and implement a strategic funding plan to address the 
Smithsonian's facilities projects. In April 2007, we testified that 
based on preliminary findings, the Smithsonian's estimated costs for 
facilities projects had increased.[Footnote 3] A June 2007 report 
commissioned by the Board of Regents concluded that the Smithsonian had 
become more dependent on federal funds from January 2000 through March 
2007. As the Smithsonian's chief decision-making body, the Board of 
Regents is responsible for the long- term stewardship of the 
Smithsonian's mission, which includes maintaining the Smithsonian's 
facilities and collections, as well as ensuring that the Smithsonian 
has a funding strategy that provides sufficient funds to support these 
activities. 

The Smithsonian is not the only entity receiving federal funds that 
faces challenges related to real property. We have found over the years 
that many federal agencies face long-standing challenges involving 
deteriorating facilities and protecting assets in the post-September 11 
environment, among other things. These findings have led to our 
inclusion of real property management on our high-risk list of federal 
programs since January 2003.[Footnote4] To address the problems we 
identified related to our high-risk designation, the administration 
added a real property initiative to the President's Management Agenda, 
and the president issued Executive Order 13327, which implements the 
real property initiative by outlining several requirements intended to 
help agencies accurately account for, maintain, and manage their real 
property assets. These requirements include, among other things, 
systematizing agency procedures and actions related to asset management 
through the development of an asset management plan and developing and 
using a complete and accurate real property data inventory and 
performance metrics. Although the Smithsonian is not covered by the 
executive order, the administration has encouraged all agencies and 
federal entities to use the executive order and related asset 
management principles as guidance. 

In light of ongoing concerns over the Smithsonian's particular 
challenges in these areas, to address your request, we answered the 
following questions: (1) How has the condition of the Smithsonian's 
facilities and cost estimate for facilities projects changed since our 
2005 report? (2) What steps has the Smithsonian taken to protect its 
assets, and what challenges has it experienced in doing so? (3) What 
steps has the Smithsonian taken to improve the management of its real 
property portfolio, and what challenges has it experienced in doing so? 
And (4) to what extent has the Smithsonian developed and implemented 
strategies to fund its revitalization, construction, and maintenance 
projects? 

To obtain information on how the condition of the Smithsonian's 
facilities has changed since our 2005 report, we interviewed the museum 
and facility directors[Footnote 5] of 14 Smithsonian facilities. To 
obtain information on new facilities projects, problems with 
facilities, and adverse effects, if any on collections, we toured 8 
facilities identified by the Smithsonian as having major revitalization 
projects or additional facilities-related problems since our April 2005 
report. To determine how the Smithsonian's cost estimate for facilities 
projects has changed since our 2005 report, we reviewed the 
Smithsonian's revised cost estimate for major revitalization, 
construction, and maintenance projects from fiscal year 2005 through 
fiscal year 2013. To obtain information on the steps the Smithsonian 
has taken to protect its assets and the challenges it has experienced, 
we reviewed documents such as the Smithsonian's 2005 All Hazards Risk 
Assessment Report and 2002 Disaster Management Program Master Plan, and 
the federal government's Interagency Security Committee's (ISC) key 
security practices. To obtain information on the steps the Smithsonian 
has taken to improve the management of its real property portfolio, we 
reviewed our prior work on this issue as well as Smithsonian documents 
related to asset management, capital planning, and master planning. To 
determine the extent to which the Smithsonian developed and implemented 
strategies to fund its revitalization, construction, and maintenance 
projects, we reviewed documents used by the Board of Regents to select 
a funding strategy and interviewed members of the Board of Regents. 

To address all of the above objectives, we also interviewed appropriate 
Smithsonian officials and conducted site visits at organizations in 
California and New York with characteristics similar to those of the 
Smithsonian, where we reviewed relevant documents, toured facilities, 
and interviewed officials. We visited the following organizations with 
characteristics similar to those of the Smithsonian: in California, the 
California Academy of Sciences, the California State University Office 
of the Chancellor, San Jose State University, San Francisco State 
University, the University of California Office of the President, the 
University of California at Berkeley, the University of California at 
San Francisco, and the Zoological Society of San Diego, including the 
Wild Animal Park; in New York, the American Museum of Natural History 
and the Museum of Modern Art. We selected California because several 
facilities' management experts recommended that a university system 
with old buildings and geographically dispersed campuses would have 
characteristics similar to those of the Smithsonian, and in California 
we could efficiently visit the University of California system and the 
California State University system, both of which meet these criteria, 
as well as a large and highly visited zoo and a science academy 
undergoing a major capital construction project. We selected New York 
so that we could efficiently go to two large and highly visited museums 
with characteristics similar to those of some Smithsonian museums. We 
conducted our work from September 2006 to September 2007 in accordance 
with generally accepted government auditing standards. See appendix I 
for a more detailed explanation of our scope and methodology. 

Results in Brief: 

The Smithsonian has made a number of facilities improvements since our 
2005 report, but the continued deterioration of many facilities has 
caused further access restrictions and has threatened collections, and 
the Smithsonian's cost estimate for facilities projects has increased. 
The Smithsonian improved the condition of a number of facilities since 
our 2005 report. For example, the Smithsonian completed its 
revitalization of the Donald W. Reynolds Center for American Art and 
Portraiture (Reynolds Center), which houses the Smithsonian American 
Art Museum (American Art Museum) and the National Portrait Gallery 
(Portrait Gallery). The Smithsonian also completed the construction of 
Pod 5, a fire-code-compliant space built to store alcohol-preserved 
specimens of the National Museum of Natural History (Museum of Natural 
History). Many of these specimens are currently stored within the 
museum building on the National Mall in Washington, D.C., in spaces 
that do not meet fire-code standards. Collections are scheduled to be 
moved to Pod 5 over the next 2 years. At the same time, problems with 
the Smithsonian's facilities have resulted in additional access 
restrictions and damage and have continued to threaten collections and 
cause other problems, according to museum and facility directors: 

* At the National Air and Space Museum (Air and Space Museum), power 
capacity issues caused by inadequate electrical systems have forced the 
museum to occasionally close galleries to visitors. 

* A lack of temperature and humidity control at storage facilities 
belonging to the Air and Space Museum has caused corrosion to historic 
airplanes and increased the cost of restoring these items for exhibit. 

* Problems with the condensate system that provides humidification to 
the building housing the Arthur M. Sackler Gallery (Sackler Gallery) 
and National Museum of African Art (Museum of African Art) have caused 
unpredictable leaks throughout the complex, threatening collections. 

* Leaks in the National Zoo's sea lion and seal pools as of July 2007 
were causing an average daily water loss of 110,000 gallons, with a 
replacement cost of $297,000 annually. 

According to Smithsonian officials, repairs to some of these problems 
are scheduled to take place over the next several years. In light of 
such problems, the Smithsonian's cost estimate for facilities projects 
from fiscal year 2005 through fiscal year 2013 for which it expects to 
receive federal funds has increased since April 2005 from about $2.3 
billion to about $2.5 billion for the same time period. According to 
Smithsonian officials, this estimate could increase further. 

The Smithsonian follows key security practices to protect its assets, 
but it faces challenges related to ensuring that museum and facility 
directors are aware of important security information and related to 
funding constraints. The Smithsonian follows key security practices we 
have identified in prior work,[Footnote 6] such as allocating resources 
to manage risk by developing a risk assessment report and leveraging 
security technology. In its risk assessment report, the Smithsonian 
identified the primary risks to over 30 of its facilities and made key 
risk reduction and mitigation recommendations. Despite these efforts, 
we found that nine museum and facility directors we spoke with were 
unaware of the contents of the Smithsonian's risk assessment report, 
and many stated that on any given day, they do not know how many 
security officers will show up at their facility. The Smithsonian's 
Office of Protection Services (OPS) is responsible for operating 
programs for security management at Smithsonian facilities. However, 
some museum and facility directors' lack of awareness of the risk 
assessment report limits their ability to work with OPS to identify, 
monitor, and respond to changes in the security of their facilities. 
Furthermore, some museum and facility directors cited an insufficient 
number of security officers to protect assets due to funding 
constraints. Smithsonian obligations for security have increased since 
September 11, 2001, from $37 million in 2001 to a high of $67 million 
in 2006, but certain needs have gone unaddressed. In addition, due to 
funding constraints, the Smithsonian's two most visited museums have 
experienced a 31 percent decrease in security officers since 2003, and 
the overall number of security officers has decreased at a time when 
the Smithsonian's square footage has increased. Some of the 
Smithsonian's museum and facility directors said that in the absence of 
more security officers, some cases of vandalism and theft have 
occurred. In addition, two museum directors stated that it has become 
more difficult for them to acquire collections on loan because lenders 
have expressed concern with the lack of protection. 

Faced with deteriorating facilities and an increased cost estimate for 
facilities projects, the Smithsonian has taken steps to improve the 
management of its real property portfolio but faces challenges related 
to funding constraints and its capital plan. Several factors affect the 
Smithsonian's efforts to manage its real property portfolio, including 
historical preservation requirements. The Smithsonian's centralized 
office for real property management, known as the Office of Facilities 
Engineering and Operations (OFEO), has made significant strides in 
several areas related to real property portfolio management, including 
improving real property data and developing performance metrics on, for 
example, maintenance and customer satisfaction. Many of these steps 
incorporate the administration's real property guidance. In addition, 
the Smithsonian has refined its capital planning process to improve its 
real property portfolio management. At the same time, however, funding 
constraints have presented considerable challenges to OFEO's efforts. 
For example, while a majority of museum and facility directors stated 
that OFEO does a good job of prioritizing and addressing problems with 
the amount of funds available, several museum and facility directors 
expressed frustration that projects at their facilities had been 
delayed, and OFEO officials stated that a lack of sufficient funds for 
maintenance has limited their ability to optimally maintain equipment, 
leading to more expensive failures later on. OFEO has worked to justify 
an increase in federal funds for facilities. However, although private 
funds made up 39 percent of the Smithsonian's capital funds for 
facilities projects for fiscal years 2002 through 2007, the Smithsonian 
has omitted privately funded projects from its capital plan and its 
estimate of $2.5 billion for facilities projects through 2013, making 
it challenging for the Smithsonian and other stakeholders to 
comprehensively assess the funding and scope of facilities projects. 
Smithsonian officials noted that the majority of these private funds 
were donated for the construction of new facilities--namely, the 
National Museum of the American Indian (Museum of the American Indian) 
and the National Air and Space Museum Steven F. Udvar-Hazy Center 
(Udvar-Hazy Center)--and there is no assurance that private funds would 
make up 39 percent of the Smithsonian's funds for capital projects in 
future years. Other organizations we visited include both private and 
public investments in their capital plans to inform their stakeholders 
about the scope of projects and the extent of such partnerships used to 
fund capital needs. 

Funding constraints are clearly a common denominator with regard to the 
Smithsonian's security and real property management, but the 
Smithsonian Board of Regents' efforts to develop and implement 
strategies to fund its facilities revitalization, construction, and 
maintenance needs have been limited. The Board of Regents has taken 
some steps to address our 2005 recommendation regarding a strategic 
funding plan for facilities projects. After reviewing materials 
prepared by Smithsonian management that identified and evaluated nine 
options to address facilities projects--such as establishing a special 
exhibition fee and issuing a facilities revitalization bond--an ad-hoc 
committee established by the Board of Regents decided to request an 
additional $100 million annually in federal funds for facilities over 
its current appropriation for 10 years, starting in 2008, for a total 
of an additional $1 billion. To implement this recommendation, in 
September 2006, several members of the Board of Regents and the 
Secretary of the Smithsonian met with the President to discuss the 
issue of increased federal funding for the Smithsonian's facilities. 
According to two members of the Board of Regents, this option was 
selected because the Board of Regents believed that the revitalization, 
construction, and maintenance of Smithsonian facilities are federal 
responsibilities. According to Smithsonian officials, it is the 
position of the Smithsonian, based on an historical understanding, that 
the maintenance and revitalization of facilities are federal 
responsibilities. Smithsonian officials pointed out that as early as 
the 1850s, the federal government has provided appropriations to the 
Smithsonian for the care and presentation of objects belonging to the 
United States. The President's fiscal year 2008 budget proposal 
included an increase of about $44 million over the Smithsonian's fiscal 
year 2007 appropriation, far short of what the Smithsonian requested, 
and it is not clear how much of this proposed increase would be used to 
support facilities. Our analysis of the Smithsonian's evaluations of 
the eight other funding options, including the potential benefits and 
drawbacks of each, showed that the evaluations were limited in that 
they did not always include a complete analysis, fully explain specific 
assumptions, or benchmark with other organizations, items crucial to 
determining each option's potential viability. For example, the 
Smithsonian's analysis of a general admission fee option included an 
adjustment of annual net gains to account for losses in revenue at 
restaurants and stores. However, the Smithsonian's materials did not 
discuss whether other museums had experienced such losses after 
establishing admission fees. We spoke with six other museums and a 
zoological park that stated that instituting or increasing admission 
fees did not decrease the amount of money visitors spent in restaurants 
and stores. In addition, although several of the nine options are 
dismissed because independently the options would not generate the 
amount of revenue required to address the Smithsonian's facilities 
projects, the evaluation did not consider the potential of combining 
options to generate more revenue. 

Clearly, the Smithsonian is at a crossroads, with significant security 
and facilities projects and funding constraints that have limited its 
ability to complete these projects in a timely manner. The Smithsonian 
also faces communication challenges regarding security, and its 
omission of private funds from its capital plan and cost estimate has 
reduced the ability of the Smithsonian and other stakeholders to 
comprehensively assess the funding and scope of facilities projects. We 
are therefore making recommendations designed to improve communication 
and information about security and to improve the comprehensiveness of 
the Smithsonian's capital plan and cost estimate. Moreover, if the 
Smithsonian does not develop a viable strategy to address its growing 
cost estimate for facilities projects, its facilities and collections 
face increased risk, and the ability of the Smithsonian to meet its 
mission will likely decline. We are therefore recommending that the 
Smithsonian Board of Regents perform a more comprehensive analysis of 
alternative funding strategies beyond principally using federal funds 
to support facilities and submit a report to Congress and the Office of 
Management and Budget (OMB) describing a funding strategy for current 
and future facilities needs. According to two members of the Board of 
Regents, the board recognizes that it may need to undertake further 
analysis of the funding options presented and consider additional 
funding options; and in June 2007, the Board voted to turn the ad-hoc 
committee into a standing committee on facilities revitalization. These 
members of the Board of Regents also stated they recognized the need to 
work closely with Congress on this issue in the future. However, these 
regents told us that in light of other priorities, the board has not 
yet had time to fully reconsider funding strategies. In commenting on a 
draft of this report, the Smithsonian concurred with our 
recommendations and provided additional information, which we have 
incorporated where appropriate. The Smithsonian also expressed concerns 
about several issues in the report. A summary of these concerns and our 
responses to them can be found in Agency Comments and Our Evaluation. 
The Smithsonian's full comments and our more detailed response can be 
found in Appendix III. 

Background: 

Congress established the Smithsonian in 1846 to administer a large 
bequest left to the United States by James Smithson, an English 
scientist, for the purpose of establishing, in Washington, D.C., an 
institution "for the increase and diffusion of knowledge among men." In 
accepting Smithson's bequest on behalf of the nation, Congress pledged 
the "faith of the United States" to carry out the purpose of the 
trust.[Footnote 7] To that end, the act establishing the Smithsonian 
provided for the administration of the trust, independent of the 
government itself, by a Board of Regents and a Secretary, who were 
given broad discretion in the use of the trust funds. The Board of 
Regents currently consists of nine private citizens as well as members 
of all three branches of the federal government, including the Chief 
Justice of the United States, the Vice President, three senators, and 
three representatives.[Footnote 8] As the Smithsonian's chief decision-
making body, the Board of Regents is responsible for ensuring the 
maintenance of the facilities and collections of the Smithsonian 
Institution. This includes ensuring that the Smithsonian has sufficient 
funds, from either public or private sources, to support these 
activities. 

Over the last 160 years, the Smithsonian's facilities inventory has 
expanded to include 19 museums and galleries, 9 research centers, a 
zoo, and other facilities--most located in or near Washington, D.C. 
These facilities include more than 700 buildings and structures, owned 
and leased, ranging from major museum buildings to storage buildings 
and storage sheds (see fig. 1). 

Figure 1: Location of Smithsonian Institution Owned and Leased 
Facilities: 

[See PDF for image] 

Source: Smithsonian Institution. 

Note: Facilities under 50,000 square feet are not represented. 

[End of figure] 

The major buildings owned by the Smithsonian range in age from about 
160 years old to less than 1 year old, with most of the facilities' 
growth occurring since the 1960s (see fig. 2). The Smithsonian's growth 
will continue, with the construction of an aircraft restoration area-- 
phase II of the Udvar-Hazy Center[Footnote 9]--and the design and 
construction of a National Museum of African American History and 
Culture (Museum of African American History and Culture), authorized by 
Congress in 2003. Beyond this, some members in both houses of Congress 
have expressed interest in developing a National Museum of the American 
Latino.[Footnote 10] 

Figure 2: Growth in Major Facilities Owned by the Smithsonian 
Institution, in Square Feet: 

[See PDF for image] 

Source: Smithsonian Institution. 

Note: This figure tracks the square footage for all owned and leased 
buildings as they were added to the inventory over time. Only the major 
facilities are named in the figure, although the square footage of 
smaller buildings is included. Also, in November 2005, the Smithsonian 
Institution sold the Victor Building. 

[End of figure] 

The physical security of federal facilities, including those on the 
National Mall, has been a more urgent governmentwide concern after the 
terrorist attacks of September 11, 2001. We have issued several 
reports, including our November 2004 report, related to improving the 
physical security of federal facilities.[Footnote 11] In that report, 
we assessed the actions of the ISC in coordinating federal facility 
protection efforts and delineated a set of six key practices that had 
emerged from the collective practices of federal agencies to provide a 
framework for guiding agencies' facility protection efforts.[Footnote 
12] These key practices are briefly described in figure 3. 

Figure 3: Key Security Practices in Facility Protection: 

[See PDF for image] 

Source: GAO. 

[End of figure] 

The Smithsonian significantly altered its facilities management 
approach in the wake of a 2001 report by NAPA. NAPA's report 
highlighted the need for major changes in the Smithsonian's facilities 
management practices to help address problems with its facilities, and 
the report included a number of recommendations. In March 2001, before 
NAPA issued its report, the Smithsonian had hired a new director to 
lead the reorganization of the facilities program. With the leadership 
of this director, in fiscal year 2004 the Smithsonian reorganized and 
centralized its facilities program under the OFEO, a new, flatter 
facilities management organization. OFEO assumed responsibility for all 
facility-related programs and budgets for the Smithsonian. OFEO 
consists of six offices responsible for different areas of facilities 
management.[Footnote 13] One of these, OPS, is responsible for 
operating programs for security management at Smithsonian facilities. 
All OFEO offices report directly to the OFEO director and are funded 
through one budget. OFEO received its first realigned budget in fiscal 
year 2004.[Footnote 14] In our 2005 report, we found that the 
Smithsonian had implemented the majority of NAPA's recommendations. 

Although the Smithsonian is a trust instrumentality with a private 
endowment, it is largely funded by federal appropriations. In fiscal 
year 2006, the Smithsonian's operating revenues were about $947 
million, of which about 65 percent were from federal appropriations. As 
shown in figure 4, the Smithsonian's federal appropriations are divided 
into two categories, both of which include some facilities-related 
funds. The facilities capital appropriation, which was about $98.5 
million in fiscal year 2006, provides funds for construction and 
revitalization projects. The salaries and expenses appropriation, which 
was about $516.6 million in fiscal year 2006, includes funding for the 
program activities of each museum and research center; rents; 
utilities; and facilities' operations, maintenance, and security costs. 

The remaining 29 percent of the Smithsonian's operating revenues in 
fiscal year 2006 was from its private trust funds (private funds), 
which are also divided into two categories: restricted and 
unrestricted. Restricted trust funds include such items as gifts from 
individuals and corporations that specify the purpose of the funds. 
Generally, restricted funds support a particular exhibit or program, or 
are used to manage the collections or support research projects. 
Restricted funds have also been provided for some facilities' 
construction and enhancements related to revitalization projects. 
Unrestricted trust funds include income from investment earnings and 
net proceeds from business activities, and can be used to support any 
Smithsonian activity. The Smithsonian typically has used unrestricted 
trust funds, which in 2006 represented 6 percent of the Smithsonian's 
total operating income, for fundraising, some salary costs, and central 
administration costs. Although the Smithsonian can use unrestricted 
trust funds for any purpose consistent with the Smithson Trust and 
therefore could use them for facilities revitalization and maintenance, 
it has not done so. Smithsonian officials stated that the unrestricted 
trust fund budget is small and that if these salary and central 
administration costs were not paid for with unrestricted trust funds, 
the Smithsonian would have to use federal funds or eliminate positions 
or programs to cover these expenses. 

Figure 4: Smithsonian Institution Operating Revenue, Fiscal Year 2006: 

[See PDF for image] 

Source: GAO analysis of Smithsonian Institution data. 

[End of figure] 

In June 2007, at the request of the Board of Regents, a committee 
called the Independent Review Committee (IRC) issued a report of its 
examination of the former Smithsonian secretary's compensation and 
expenses and related board governance. The report found that private 
funds raised annually from donors declined over the former secretary's 
tenure, from January 2000 through March 2007. In addition, the IRC 
found that business revenue also dropped during the former secretary's 
tenure, while funds from federal appropriations and governmental grants 
increased more than 60 percent. As a result, the IRC concluded that the 
Smithsonian became more dependent on federal funds during the former 
secretary's tenure.[Footnote 15] Also in June 2007, the Board of 
Regents' Governance Committee issued a report and recommendations to 
strengthen the Board of Regents' oversight of the Smithsonian. One of 
several recommendations to the Board of Regents was that its ad-hoc 
Committee on Facilities Revitalization should become a standing 
committee in order to underscore the Board of Regents' commitment to 
resolving the Smithsonian's April 2005 estimate of $2.3 billion for 
facilities projects. 

While Congress has authorized major new museums and facilities, 
Congress has moved away from fully funding the construction of these 
facilities beginning in 1982. At that time, Congress authorized $36.5 
million for the construction of the Museum of African Art and a Center 
for Eastern Art[Footnote 16] and required that the Smithsonian pay for 
the balance of the project with other funds. In 1989, Congress required 
that not more than two-thirds of the total cost of the Museum of the 
American Indian come from federal appropriations. More recently, in 
2003, Congress also required that 50 percent of the cost to construct 
the Museum of African American History and Culture come from nonfederal 
sources and the other 50 percent from federal appropriations. 

Despite Some Improvements, Deteriorating Facilities Have Caused Further 
Problems, and Cost Estimate for Facilities Projects Has Increased: 

The Smithsonian has improved the condition of a number of facilities 
since our 2005 report, such as the revitalization of the Reynolds 
Center and parts of the National Zoo. However, problems with the 
Smithsonian's facilities since 2005 have continued to cause access 
restrictions and damage, and continue to threaten collections. 
Moreover, many long-term facilities problems remain. According to 
Smithsonian officials, repairs to some of these problems are scheduled 
over the next several years. At the same time, the Smithsonian's cost 
estimate for facilities projects through fiscal year 2013 has increased 
since April 2005, from $2.3 billion to $2.5 billion for the same time 
period. 

The Smithsonian Improved the Condition of a Number of Facilities Since 
2005: 

Since our 2005 report, the Smithsonian has improved the condition of a 
number of its facilities through revitalization, construction, and 
repair efforts. For example, it completed a $238 million revitalization 
of the Reynolds Center, which houses the American Art Museum and the 
Portrait Gallery. These museums were reopened to the public in July 
2006. The revitalization included upgrading the building's systems, 
such as heating, ventilation, and air conditioning, electrical, and 
plumbing, and adding life and safety upgrades. It also included a 
historical renovation of the building. As part of this renovation, for 
example, ruined encausted tiles on one floor were replaced with new 
tiles matching the original tiles, and a skylight that had been covered 
over for many years was opened up and restored. The renovation, which, 
according to Smithsonian officials, made 60,000 square feet of building 
space previously used for storage or staff functions available for 
public use, also included several upgrades to the building's original 
space--such as a conservation center and an auditorium--that were paid 
for with private funds. In addition, the Smithsonian completed the 
revitalization of one section of the National Zoo (the Fujifilm Giant 
Panda Habitat and Asia Trail) in October 2006 and is in the process of 
further revitalizations at the National Zoo as well as major 
revitalizations at the National Museum of American History Kenneth E. 
Behring Center (Museum of American History), which is currently closed 
for revitalization, and the Museum of Natural History. 

In addition, the Smithsonian completed construction of a new storage 
facility known as Pod 5, which is located at the Museum Support Center 
at the Suitland, Maryland, campus. Pod 5 was built to provide a fire- 
code-compliant space to store and conduct research on alcohol-preserved 
specimens of the Museum of Natural History, many of which are currently 
stored within the museum building on the National Mall in Washington, 
D.C., in spaces that do not meet fire-code standards. Construction was 
completed in April 2007, and according to Smithsonian officials, 
collections are scheduled to be moved to Pod 5 over the next 2 years. 

The Smithsonian also made some improvements to facilities since 2005 
through repairs. For example, according to the director of the Freer 
Gallery of Art and Arthur M. Sackler Gallery (Freer and Sackler 
Galleries), some external leaks along the perimeter of the Sackler 
Gallery have been eliminated by the installation of copper flashing. 

Problems with the Smithsonian's Facilities Since 2005 Have Caused 
Access Restrictions and Damage, and Continue to Threaten Collections: 

Despite the progress the Smithsonian has made in improving a number of 
its facilities since our 2005 report, the continued deterioration of 
many facilities has caused further access restrictions and damage, and 
continues to seriously threaten collections. According to Smithsonian 
officials, repairs to some of the following problems are scheduled to 
take place over the next several years. For example, the electrical 
systems at the Air and Space Museum are scheduled to be replaced in 
fiscal years 2007 through 2010. Access restrictions and damage caused 
by facilities' conditions include the following: 

* Power capacity issues caused by inadequate electrical systems have 
forced the Air and Space Museum to occasionally close galleries to 
visitors, according to the museum's director. The electrical systems at 
the Air and Space museum were installed in 1975 and are obsolete and at 
the end of their useful life. Complete replacement is needed to avoid 
outages from equipment failure (see fig. 5). 

Figure 5: Obsolete Electrical Systems at the National Air and Space 
Museum: 

[See PDF for image] 

Source: Smithsonian Institution. 

[End of figure] 

* Recurring leaks in a Museum of African Art gallery that held an 
exhibit called Art of the Personal Object forced the museum to 
temporarily close the gallery several times from 2004 through 2006 and 
take down part of the exhibit's collections until the leaks were 
repaired, according to the museum's director. Smithsonian officials 
noted that addressing such leaks is a regular maintenance issue. 

* Chronic leaks in the roof of the Cultural Resources Center at 
Suitland, Maryland, which was completed in 1998 and opened in 1999 to 
hold collections of the Museum of the American Indian, have forced 
staff to place plastic over several shelving units used to store 
collections, such as a set of wooden boats that includes an Eskimo 
kayak from Greenland and a rare Yahgan dugout canoe from Tierra del 
Fuego, according to officials at this facility (see fig. 6).[Footnote 
17] The plastic sheeting limits visitors' visual access to the boats 
during open houses, which provide Native Americans and other groups 
with access to the collections. One museum official stated that it was 
also an embarrassment during open houses to have to explain that a roof 
leak threatens collections. According to Smithsonian officials, the 
building's roof is a spiral shape constructed with copper plate and 
compositional panels soldered together. However, the soldered joints on 
this complex roof design were not constructed well by the subcontractor 
responsible for building the roof. According to a Smithsonian official, 
the Smithsonian has worked with the company identified by the roofing 
manufacturer to assume the warranty for the roof to make repairs. While 
some of the costs to repair the roof were covered by warranty, others 
were not and were paid for by the Smithsonian. 

Figure 6: Plastic Sheeting Covering Native American Boats to Prevent 
Water Damage at the Smithsonian Institution's Cultural Resources 
Center: 

[See PDF for image] 

Source: Smithsonian Institution. 

[End of figure] 

* A lack of temperature and humidity control at the Museum of Air and 
Space's collection storage facilities in Suitland, Maryland, which have 
large doors that do not seal and let in rain, has caused corrosion to 
historic airplanes and other collections and increased the cost of 
restoring these items for exhibit, according to museum officials. 

In addition, two museum and facility directors told us of alarming 
"near misses"--events related to inadequate facilities that could have 
been catastrophic to collections had they occurred at different times. 
According to Sackler Gallery officials, in October 2006, a major leak 
unexpectedly occurred in a holding area used by the museum to store 
exhibits on loan three weeks before $500 million worth of art arrived 
to be held there. If the leak had occurred while the art was being 
stored in this space, the art could have been destroyed. The leak was 
caused by ongoing problems with the steam system used to provide 
humidification to the Quadrangle complex, known as the condensate 
system. Problems with this system--which the gallery shares with the 
other facilities that make up the Quadrangle, including the Museum of 
African Art--have caused unpredictable leaks throughout the complex 
since 1993, continually threatening collections.[Footnote 18] Museum 
officials stated that staff must routinely spend time each morning 
searching for new leaks in order to move or cover collections to keep 
them safe--time that could be used for programmatic efforts--and 
several officials emphasized they have been lucky to avoid major damage 
to the collections thus far. (See fig. 7.) 

Figure 7: Plastic Sheeting Protecting Collection Items from Water 
Damage in a Storage Area of the Smithsonian Institution's Quadrangle 
Complex: 

[See PDF for image] 

Source: Smithsonian Institute. 

[End of figure] 

In addition, the director of the National Zoo stated that because of 
inadequate fire protection in the zoo's invertebrate house, a fire in 
this building in 2006 did not set off a smoke alarm and could have 
burned down the entire building--which also includes the reptile 
discovery center. (See fig. 8.) The fire occurred during work hours and 
was quickly put out by staff, but the director stated that the incident 
alerted him to the potentially disastrous consequences of a fire at the 
National Zoo to facilities and the animals living in them. Moreover, 
the director stated that inadequate fire protection systems throughout 
much of the National Zoo threaten the zoo's collections overall. For 
example, most buildings do not have sprinklers, some fire hydrants do 
not have enough water pressure for sprinkler systems that are in place, 
and the zoo has no smoke evacuation systems designed to remove smoke 
from a building in the case of a fire to prevent the death of people or 
animals from smoke inhalation. The director stated that until the zoo's 
fire protection systems are upgraded, there is the potential that a 
fire could cause devastation similar to a 1995 fire at the Philadelphia 
Zoo's primate house, which destroyed the building and killed 23 
animals. 

Figure 8: The National Zoo's Invertebrate House, Located at the Back of 
the Reptile Discovery Center: 

[See PDF for image] 

Source: GAO. 

[End of figure] 

Similar problems at other Smithsonian facilities also threaten staff 
and collections. For example, the director of the Freer and Sackler 
Galleries stated that the Freer Gallery has also had leaks caused by 
problems with its condensate system. In addition, according to the 
Director of the Smithsonian Environmental Research Center, temporary 
trailers that have been in place at the center for 3 to 35 years are 
degrading and do not have fire suppression systems for life safety. At 
one point, the floor fell out of a trailer due to decay, and the 
collections landed on the ground; in other trailers, hallway floors 
have fallen through. 

Many Long-Term Facilities Problems Remain: 

Other long-term facilities issues have caused additional problems for 
the Smithsonian since 2005, including increasing the Smithsonian's 
energy consumption and reducing its ability to carry out its mission. 
Ongoing problems with facilities' conditions that museum directors 
described to us include the following: 

* The Hirshhorn Museum and Sculpture Garden's building is not well 
insulated and is the Smithsonian's largest (on a per-square-foot basis) 
consumer of energy; in addition, its façade is leaking in places. 

* The National Zoo is currently unable to provide many of its animals 
with the state-of-the-art habitats required to meet the zoo's goal of 
providing the highest quality animal care. Many of the zoo's animal 
areas and facilities are in relatively poor condition. For example, 
some of the zoo's facilities, including the bird house, small mammals 
house, and the reptile house, were built in the 1920s, while others, 
including the lion and tiger area and the ape house, were built in the 
1960s. Many of these facilities do not meet current code requirements 
(buildings are brought up to code at the time they are renovated) and 
have many failing systems. (See fig. 9.) 

Figure 9: Ape House Exhibit at the National Zoo: 

[See PDF for image] 

Source: Smithsonian Institution. 

[End of figure] 

* In addition, according to officials at the National Zoo, the zoo's 
sea lion and seal pools have major leaks the zoo has not been able to 
fix without overhauling these exhibits. In January 2007, average daily 
water loss from these two pools was 140,000 gallons, and the lost water 
flowed into the Washington, D.C., sewer system. According to these 
officials, preliminary site investigation of the pool indicated that 
while the structures themselves appeared sound, the source of most of 
the water loss was a result of the old underground supply and return 
piping. Temporary supply lines were installed, and it appeared that the 
amount of water loss in the seal pool was greatly decreased, reducing 
the average daily water loss from the two pools to 110,000 gallons as 
of July 2007, with a replacement cost of approximately $297,000. A 
camera scoping system was being used to identify where to make 
temporary repairs to the sea lion pool. (See fig 10.) 

Figure 10: Sea Lion Pool at the National Zoo: 

[See PDF for image] 

Source: GAO. 

[End of figure] 

* The Director of the Museum of African Art stated that leaks in a 
skylight since 2005 have at times forced the museum to cover the 
skylight with plastic to protect the building and its collections (see 
fig. 11). The Director stated that the skylights have leaked for many 
years, were repaired in 2004, and started leaking again in 2005. In 
addition, according to the Director, in 2006, leaks in the roof 
membrane of the pavilion by the main visitor entrance forced the museum 
to put up plastic around the entrance and remove art objects from the 
area, reducing the visual appeal of the museum's entrance. 

Figure 11: Leaking Skylight over the Museum of African Art: 

[See PDF for image] 

Source: Smithsonian Institution. 

[End of figure] 

The Smithsonian's collections storage, conservation, and research 
facilities located in Suitland, Maryland, have many significant long- 
term problems. These facilities not only hold collections but also are 
actively used by Smithsonian staff and outside researchers for 
conservation and research. For example, according to the Director of 
the Museum Conservation Institute, which is the Smithsonian's center 
for advanced scientific study of the care of museum collections, the 
institute's facility has leaks, an inadequate electrical supply, 
inadequate air handling, and a general lack of office and lab space 
that makes it more difficult for the institute to carry out its 
research and conservation work. The Museum Support Center, which 
contains storage pods, research labs, and administrative space, has 
inadequate air handlers for the pods that need replacing, and some of 
the labs lack necessary equipment. For example, a lab that belongs to 
the Museum of American History was temporarily turned over to the 
American Art Museum while the Reynolds Center was being revitalized. 
This museum stripped out existing exhaust hoods because it did not need 
that type of equipment for the conservation work it was doing in the 
lab. The lab has now been turned back over to the Museum of American 
History, but funds are lacking to reinstall the exhaust hoods, limiting 
the lab's usefulness as staff prepare new exhibits for the museum's 
reopening after its current revitalization. Furthermore, a greenhouse 
at Suitland that is used for botany research is no longer fully 
enclosed, as several large glass panes have slipped from their frames, 
leaving open spaces that allow conditioned air to escape, increasing 
energy costs, and reducing the Smithsonian's ability to maintain the 
optimal environment for the plants being studied. 

According to Smithsonian officials, repairs to some of the major 
problems with its facilities are scheduled to take place over the next 
several years. For example, the electrical systems at the Air and Space 
Museum are scheduled to be replaced in fiscal years 2007 through 2010, 
a contract was recently awarded to address the problems with the 
condensate system at the Quadrangle complex, and the Smithsonian's 
capital plan includes projects intended to address the fire protection 
problems at the National Zoo in fiscal years 2008 through 2010 and to 
design and renew systems at the seal and sea lion exhibit in fiscal 
years 2008 and 2009. 

The Smithsonian's Estimated Cost for Facilities Projects through Fiscal 
Year 2013 Has Increased Since 2005: 

As of March 2007, the Smithsonian estimates it will need about $2.5 
billion for revitalization, construction, and maintenance projects 
identified from fiscal year 2005 through fiscal year 2013, an increase 
of about $200 million from its April 2005 estimate of about $2.3 
billion for the same time period. The Smithsonian's estimated 
revitalization and new construction costs are driven in part by the 
need to modernize or add systems, such as fire detection and alarm and 
security systems, and to comply with newer life safety code 
requirements, such as those for handicapped accessibility to buildings 
and restrooms. Maintenance costs include staff costs, minor repair and 
maintenance projects, and other contracts, supplies, materials, and 
equipment for Smithsonian's maintenance program. Smithsonian officials 
stated that to update its 2005 estimate, they identified changes that 
had occurred to the project cost figures used in the 2005 estimate and 
then subtracted from the new total the appropriations the Smithsonian 
had received for facilities revitalization, construction, and 
maintenance projects for fiscal years 2005 through 2007. 

According to Smithsonian officials, this estimate includes only costs 
for which the Smithsonian expects to receive federal funds. Projects 
that have been or are expected to be funded through the Smithsonian's 
private trust funds were not included, although the Smithsonian has 
used trust funds to support some facilities projects. For example, the 
construction of Udvar-Hazy Center Phase I was funded through trust 
funds.[Footnote 19] According to Smithsonian officials, maintenance 
projects are not generally funded through trust funds.[Footnote 20] 

The increase in the Smithsonian's cost estimate for revitalization, 
construction, and maintenance projects through fiscal year 2013 from 
about $2.3 billion in our April 2005 report to about $2.5 billion as of 
March 2007 was due to several factors, according to Smithsonian 
officials. For example, Smithsonian officials said that major increases 
had occurred in projects for the National Zoo and the Museum of 
American History because the two facilities had recently developed 
master plans that identified additional requirements.[Footnote 21] In 
addition, according to Smithsonian officials, estimates for 
antiterrorism projects had increased due to adjustments for higher 
costs for security-related projects at the Air and Space Museum. 
According to Smithsonian officials, the increase also reflects the 
effect of delaying corrective work in terms of additional damage and 
escalation in construction costs. 

According to Smithsonian officials, the Smithsonian's March 2007 
estimate of about $2.5 billion could also increase, as the April 2005 
estimate of about $2.3 billion was largely based on preliminary 
assessments, and therefore, as Smithsonian completes more master plans, 
more items will be identified that need to be done. Moreover, this 
estimate does not include the estimated cost of constructing the Museum 
of African American History and Culture, which was authorized by 
Congress in 2003 and which the Smithsonian notionally estimates may 
cost about $500 million--half of which is to be funded by federal 
appropriations. 

The Smithsonian Follows Many Key Security Practices to Protect Its 
Assets but Faces Communication and Funding Challenges: 

The Smithsonian follows key security practices to protect its assets 
but faces significant challenges ensuring that museum and facility 
directors are aware of important security information. Moreover, due to 
funding constraints, Smithsonian officials and some museum and facility 
directors cited an insufficient number of security officers to protect 
assets. 

The Smithsonian Follows Key Security Practices: 

We found that the Smithsonian follows key security practices we have 
defined in prior work. For example, in order to allocate resources more 
effectively to manage risk, in 2004, the Smithsonian contracted for an 
all-hazards risk assessment report. This report, which includes 
individual assessments for over 30 Smithsonian facilities, was 
completed in 2005.[Footnote 22] These assessments identify the primary 
risks to each facility and also describe the key observed 
vulnerabilities and risks, as well as the key risk reduction and 
mitigation recommendations proposed for each facility in order to help 
the Smithsonian effectively prioritize security projects. As a 
supplement to this report, in the spring of 2006, the contractor 
completed a strategy that included specific recommendations on how to 
use the Smithsonian's capital and maintenance funds to implement future 
security projects and operational changes aimed at reducing the risk 
for Smithsonian facilities. 

In another example, the Smithsonian leverages security technology to 
protect its assets by using technologies such as perimeter vehicle 
barriers, closed circuit television cameras (CCTV), emergency voice 
systems, window blast film, and electronic screening of visitors and 
mail. According to a Smithsonian official, the technologies used for 
its physical security plan--which primarily consists of two separate 
programs for mitigating the risks to the Smithsonian's staff, visitors, 
collection and facilities--allows OPS to extend the capabilities of 
security staff and to improve facility security. For more information 
on the Smithsonian's following of key security practices, see appendix 
II. 

The Smithsonian Faces Challenges in Ensuring That Museum and Facility 
Directors Are Aware of Important Security Information: 

Although the Smithsonian follows many key security practices, many 
museum and facility directors we spoke to stated that they lacked 
information on key security measures. For example, although OPS sent a 
notification letter with the relevant section of the all-hazards risk 
assessment report to museum and facility directors in late 2006, nine 
museum and facility directors we spoke with told us they were unaware 
of the results of this report for their facility and had not seen or 
been briefed on this report. In contrast, five museum and facility 
directors stated that they were aware of this report. OPS is 
responsible for security at the Smithsonian's museums and facilities. 
However, the lack of awareness of some museum and facility directors 
about the all-hazards risk assessment report limits their ability to 
work with OPS to identify, monitor, and respond to changes in the 
security environment of their facilities. 

In addition, many museum and facility directors stated that they did 
not always receive useful information from OPS regarding security 
officer staffing levels and other security decisions. For example, 
although security officer staffing levels at museums and facilities can 
vary on a daily basis due to attrition, absences, and OPS temporarily 
moving security officers from one facility to another to address needs 
with available staff, many museum and facility directors stated that on 
any given day, they do not know how many security officers will show up 
at their facility--information needed to oversee mitigation efforts and 
manage security. These museum and facility directors stated that 
knowing the security staff level at their museums is important for 
several reasons, such as knowing which galleries do not have sufficient 
protection from vandalism and limiting response time to emergencies. 
For example, one director stated he once went to report an emergency to 
a security officer at an established post. However, when he got to the 
post, the security officer was absent, and the director had to search 
for an alternate security officer. The director stated that had he 
known that security officer levels were down that day, he could have 
directly reported this emergency to a post where he knew an officer was 
on duty, which would have reduced the emergency response time. 

Also, some museum and facility directors stated that they do not know 
when security upgrades are being installed at their facilities. 
According to one museum director, about 1 year ago, contractors working 
for OPS arrived at the museum without any prior communication with the 
museum staff--including the museum's director or the assistant director 
of protection services--to begin work installing a key card access 
system. Staff were not supplied with key cards or trained in the use of 
the new system; as a result, once the system was installed, they were 
denied access to critical areas of the building, such as offices and 
collection storage areas. 

Due to Funding Constraints, Some Museum and Facility Directors Cite 
Insufficient Number of Security Staff to Protect Assets: 

Funding constraints have also been a challenge to the Smithsonian's 
security efforts, according to museum and facility directors, some of 
whom stated that, in the absence of more security officers, some cases 
of vandalism and theft have occurred. According to OPS, 35 cases of 
vandalism were reported from January 2005 through August 2007. OPS 
officials stated that funding constraints have affected its ability to 
retain and recruit security officers. Following September 11, 2001, the 
Smithsonian's security costs significantly increased as a result of the 
mitigation recommendations of the 2002 Composite Risk Assessment. 

The Smithsonian's security efforts are funded entirely through federal 
funds.[Footnote 23] Smithsonian obligations for security have increased 
since September 11, 2001--from $37 million in 2001 to a high of $67 
million in 2006--but certain needs have gone unaddressed. For example, 
since 1999, the Smithsonian has identified $31.3 million in projects 
for its security system modernization program--which involves upgrading 
and integrating security capabilities across the organization--and thus 
far has received $17.6 million to complete security upgrades, such as 
CCTV and key card access systems. As a result, the Smithsonian has 
implemented some of these security systems upgrades at some facilities, 
but other facilities have not yet received the necessary funds to do 
so. Furthermore, the Smithsonian is still working on implementing blast 
and perimeter security projects, which were mitigation recommendations 
from its all-hazards risk assessment report. Completion of these 
projects depends on the availability of funds. Smithsonian officials 
noted that security projects compete with maintenance needs for 
facilities' funds. Therefore, the limited overall funds for these 
issues force a balancing of priorities in both areas, sometimes against 
one another. 

In addition, the number of Smithsonian security officers has been 
reduced steadily since May 2003, even as the Smithsonian's square 
footage has increased due to new museums being opened. As a result, 
there have been fewer officers and other security staff to cover more 
space. For example, from May 2003 to May 2007, 6 out of 10 museums and 
facilities for which the Smithsonian provided data experienced a 
reduction in the number of security officers assigned to the facility; 
the reductions ranged from 4 percent to 41 percent (see fig. 12). 
Smithsonian officials noted that some museums experienced a decrease in 
visitation during some of these years, and that OPS increased the use 
of technological security equipment, such as alarms and cameras, during 
this time. 

Figure 12: Security Officer Levels at Smithsonian Institution Museums 
and Facilities, 2003 Compared with 2007: 

[See PDF for image] 

Source: GAO analysis of Smithsonian Institute data. 

Note: Based on the data provided by the Smithsonian, we could compare 
2003 levels to 2007 levels only for these 10 museums because some 
museums were closed or opened between 2003 and 2007. For example, the 
Museum of American History was closed for renovation in 2006 and will 
reopen in the summer of 2008; therefore, its security staff was reduced 
from 2003 levels. The Museum of the American Indian opened to the 
public in 2004. In addition, the National Air and Space Museum Stephen 
F. Udvar-Hazy Center Phase I has contract security officers overseen by 
two OPS officers. 

[End of figure] 

Five of the 10 Smithsonian facilities shown in figure 12 experienced 
security officer reductions of 25 percent or more. For example, the 
Smithsonian American Art Museum's Renwick Gallery experienced a 41 
percent reduction in security officers since 2003. In addition, the 
security officer levels decreased significantly at both the Smithsonian 
Quadrangle (25 percent) and the Cultural Resources Center (28 percent). 
Some of the Smithsonian's most visited and largest facilities have 
experienced the greatest reductions in security officers. The Air and 
Space Museum, which contains 663,170 square feet, and the Museum of 
Natural History, which contains 1.98 million square feet, both 
experienced a 31 percent reduction in security officers in 2007 
compared with 2003. 

Additionally, attendance has increased recently at many of the museums, 
intensifying the demands on the reduced security staff. Moreover, these 
reductions in the numbers of security staff at museums and facilities 
occurred even though the Smithsonian had one or more facilities closed 
for renovations during this time, and OPS assigned some security 
officers from the closed facility to other facilities. In the future, 
when the Smithsonian has all of its facilities open, the need for 
security officers will increase. For example, the Museum of American 
History currently is closed to the public; as a result, 28 of its 
security officers are temporarily reassigned to various museums. 
Smithsonian officials stated that when the Museum of American History 
reopens, those 28 officers will return to the Museum of American 
History, leading to vacancies at the Museum of the American Indian and 
the Portrait Gallery. 

All museum and facility directors we spoke with stated that the 
security officer levels at their facilities are inadequate. Some museum 
and facility directors stated that some of the galleries that used to 
have several security officers have been reduced to sharing one 
security officer with other galleries, resulting in too much square 
footage having to be protected by one officer. Another facility 
director stated that security alarms go off frequently and that a 
security officer is not available to check the validity of the alarm 
because the facility does not have an adequate amount of security 
officers. Moreover, one museum did not have enough security officers 
for 2 days to staff the museum's main entrance, resulting in the main 
entrance being closed. The museum was still open to the public through 
the lower-level staff entrance; however, the director of this facility 
stated that the closed main entrance deterred many people from 
entering. Also, museum and facility directors at other facilities 
stated they have strongly considered temporarily closing galleries due 
to an inadequate level of security officers needed to properly protect 
collections. Lastly, two museum directors stated that it has become 
more difficult for them to acquire collections on loan because lenders 
have expressed concern with the lack of protection. 

Some of the Smithsonian's museum directors stated that insufficient 
numbers of security officers contributed to some cases of vandalism and 
theft. For example, one museum director stated that on or before 
November 2006, several mammalian fossils were stolen from an exhibit, 
and damage to dinosaur exhibits has periodically occurred from visitors 
throwing water bottles and other objects at them. Three other museum 
directors stated that their museums have experienced increased rates of 
vandalism due to the lack of security officers patrolling the 
galleries. At one museum, for example, an object that resembles a 
telephone booth was continually vandalized by visitors who would write 
on the exhibit. The vandalism stopped when the museum convinced OPS to 
install a camera near the object. In the same museum, visitors have in 
some instances spit on or kissed a few pieces of artwork in the 
building. According to an OPS official, the Smithsonian started a new 
program in the summer of 2007, in which college students were hired as 
gallery attendants. The program places gallery attendants in exhibits 
that cannot be manned by security guards. The gallery attendants do not 
wear uniforms or fulfill any security officer duties; however, they 
wear uniform polo shirts so they are easily recognizable by the public 
and serve as additional eyes and ears for the security officers. 

In addition to having insufficient numbers of security officers, 
according to a Smithsonian official, funding constraints have affected 
the Smithsonian's ability to recruit and retain security officers, who 
are able to find higher paying jobs at other federal agencies. 
According to Smithsonian officials, officer attrition has increased 
every year since 2003. Smithsonian officials stated that after they 
invest in the training of their security officers, many of them leave 
for federal agencies, such as the Department of Defense, that can hire 
officers at a higher pay grade. The Smithsonian's experience is not 
unique: as we reported in 2003, more than 300 federal law enforcement 
officers in the Washington, D.C., area left their jobs to join the 
Transportation Security Administration during fiscal 2002, which was 
able to offer air marshal recruits higher compensation and more 
flexible benefit packages than many other federal police 
forces.[Footnote 24] After September 11, 2001, the Smithsonian 
attempted to address this problem by increasing its entry level 
security officer pay grade from a General Schedule-4 to General 
Schedule-5. However, according to Smithsonian officials, this pay grade 
increase has been insufficient to compete with other agencies and 
localities. OPS submitted a request through its budget process to 
upgrade all entry level security officers to a General Schedule-6 pay 
grade starting in fiscal year 2004, but the request was denied by 
Smithsonian management due to inadequate funds in the Smithsonian 
budget and higher internal budget priorities. 

The Smithsonian Has Taken Steps to Improve Real Property Portfolio 
Management but Faces Challenges Related to Funding Constraints and Its 
Capital Plan: 

Faced with deteriorating facilities and an increased cost estimate for 
facilities projects, the Smithsonian has taken steps to improve the 
management of its real property portfolio but faces challenges related 
to funding constraints and its capital plan. Several factors, such as 
historic preservation requirements, affect the Smithsonian's efforts to 
manage its real property portfolio within funding constraints. The 
Smithsonian has taken steps to improve its real property portfolio 
management that incorporate the administration's real property 
guidance. These include improving real property data and developing 
performance measures on, for example, facility condition and customer 
satisfaction. In addition, the Smithsonian has taken steps to improve 
its capital planning process, which is also an important part of real 
property portfolio management. However, funding constraints have 
presented considerable challenges, and, while OFEO has worked to 
justify an increase in federal funding for facilities, the 
Smithsonian's capital plan omits privately funded projects. Although 
information on the scope and funding of privately funded projects is 
provided to stakeholders in other documents, the lack of this 
information in the capital plan has limited the ability of the 
Smithsonian and other stakeholders to comprehensively assess the 
funding and scope of facilities projects. 

Several Factors Affect the Smithsonian's Real Property Management 
Efforts: 

Several factors affect the Smithsonian's efforts to manage its real 
property portfolio within funding constraints. As previously discussed, 
the condition of many of the Smithsonian's facilities is deteriorating. 
In addition, according to Smithsonian officials, many of the 
Smithsonian's buildings are either historic or signature buildings, 
which can increase the cost of revitalization or construction projects. 
Smithsonian officials stated that, by law, the Smithsonian is required 
to comply with historical preservation requirements and that preserving 
the historical character of its facilities is in the interest of the 
public and Congress. Smithsonian officials stated that the National 
Capital Planning Commission closely monitors the Smithsonian's 
compliance with historical preservation guidance.[Footnote 25] As such, 
the Smithsonian's revitalization of historic buildings has included 
restoring historical elements that have increased the costs of these 
projects. For example, according to Smithsonian officials, the Reynolds 
Center revitalization included replacing windows with historically 
appropriate glass and replacing a ruined tile floor with matching tile 
that had to be imported from England. OFEO officials stated that they 
do not consider these decisions to be choices given the legal 
requirements necessitated by historic preservation laws and 
regulations. 

In addition, according to OFEO officials, when the Smithsonian is 
mandated by Congress to build new museums, particularly when they are 
on the National Mall or other prominent locations, the buildings, such 
as the Museum of the American Indian, are considered signature or 
landmark buildings and often have architectural elements that require 
innovative, creative, and sometimes expensive architectural and 
engineering techniques. This can increase not only the costs and 
difficulty of constructing these buildings but also the cost and 
difficulty of maintaining them after construction. However, OFEO 
officials stated that the Smithsonian strives to fulfill the 
architect's vision since stakeholders, including Congress and the 
public, expect these buildings to be landmarks. 

Another factor that affects the Smithsonian's efforts to manage its 
real property portfolio within funding constraints is the number of its 
facilities. Although the Smithsonian has disposed of a few facilities 
in recent years, as discussed below, OFEO officials stated that the 
Smithsonian considers its remaining facilities, in particular its 
museums and research centers, as central to its mission and, therefore, 
worthy of care and protection. According to OFEO officials, many 
Smithsonian units were created by statute or restricted gift, and the 
Smithsonian is legally limited in the kinds of decisions it can make 
about some of its facilities. In April 2001, the Smithsonian proposed 
closing the National Zoo's Conservation and Research Center in Front 
Royal, Virginia, but this proposal generated considerable opposition 
and was abandoned. In recent years, the Smithsonian's appropriations 
acts have included language prohibiting the Smithsonian from using 
federally appropriated funds to close facilities related to existing 
Smithsonian science programs without the approval by the House and 
Senate Committees on Appropriations.[Footnote 26] 

The Smithsonian Has Taken Steps to Improve Its Real Property Portfolio 
Management and Incorporate Real Property Guidance: 

Faced with deteriorating facilities and an increased cost estimate for 
facilities projects, the Smithsonian has continued to build on efforts 
to improve its real property portfolio management that started in 
fiscal year 2001, when it began to centralize its facilities management 
in response to NAPA's recommendations and its own internal review. In 
our 2005 report, we found that in reorganizing its facilities 
management under OFEO, the Smithsonian was incorporating recognized 
industry best practices so that its resources would go as far as 
possible toward addressing its rapidly growing revitalization, 
construction, and maintenance workload. Since then, OFEO has continued 
some of these efforts as well as implemented new ones. Specifically, 
OFEO has made significant strides in real property guidance, real 
property data inventory, maintaining the Smithsonian's real property at 
the right size and cost, facilities maintenance, and the development 
and use of performance measures. Many of these steps incorporate the 
administration's real property guidance. 

The Smithsonian's steps to improve its guidance on real property 
management are consistent with a goal of the real property initiative 
to systematize agency procedures and actions related to asset 
management through the development of an asset management plan. Since 
2005, OFEO finalized and put into effect its first Operations and 
Maintenance Handbook and revised its Facilities Project Management 
Handbook to streamline and update its content. These handbooks define 
the Smithsonian's policies and procedures related to their respective 
subjects, and OFEO officials told us they are in effect throughout the 
Smithsonian. In addition, the Smithsonian has had a directive on real 
estate asset management in effect since May 1, 2003, which establishes 
policy for managing real estate assets. It is in the process of 
revising this directive. According to OFEO officials, OFEO is also 
developing a real estate management handbook that will articulate the 
Smithsonian's policies related to real property acquisitions and 
disposals, among other things. OFEO has also used a space utilization 
guide it developed in 2003 to standardize the amount of space given to 
areas such as offices and conference rooms during new construction and 
new leases, and as it reconfigures space during 
revitalizations.[Foontote 27] 

The Smithsonian has also recognized the importance of the real property 
initiative's goal of a complete and accurate inventory of all 
constructed assets to help with decision making. As part of the real 
property initiative, the Federal Real Property Council (FRPC) 
identified and defined 24 data elements that must be captured and 
reported by the 15 largest federal landholding agencies.[Footnote 28] 
Although the Smithsonian is not required to capture or report this 
data, the Smithsonian has developed a database to do so. As of August, 
15, 2007, a majority of the database was complete, and the Smithsonian 
was continuing to add data to it. For example, 80 percent of the data 
on the element of size was included in the database, and according to 
Smithsonian officials, the missing data on size were mostly for 
outlying and miscellaneous spaces that it will include when reasonably 
available. Four of the 24 data elements established by the FRPC are 
performance measures--utilization, condition index, mission dependency, 
and annual operating and maintenance costs. Smithsonian officials 
stated that the Smithsonian was currently in the process of inputting 
the data on condition index, mission dependency, and annual operating 
and maintenance costs into the database and that it planned to include 
data on utilization by the end of fiscal year 2008. 

OFEO has also taken steps to maintain the Smithsonian's real property 
inventory at the right size and cost to meet the Smithsonian's mission. 
For example, although OFEO officials described the Smithsonian's real 
estate portfolio as stable and said there is little opportunity for 
disposing of facilities, according to Smithsonian officials, since 
2005, OFEO spearheaded the disposal of the only three owned buildings 
that the Smithsonian has disposed of in the past 20 years. According to 
Smithsonian officials, these disposal decisions were made to eliminate 
unneeded space or reduce costs, as shown in table 1. 

Table 1: Buildings Disposed of by the Smithsonian Since 2005, Including 
Elements of Decision and Proceeds, as Described by Smithsonian 
Officials: 

Building and purpose: Bronx, New York, warehouses used to hold 
collections for the Museum of the American Indian; Key elements of 
disposal decision: No need for these warehouses once these collections 
were moved to the National Museum of the American Indian and the 
Conservation Research Center in Suitland, Maryland; Date and proceeds: 
Sold in April 2005, with proceeds of $11.1 million, which went to the 
Smithsonian trust and debt related to construction of National Museum 
of the American Indian. 

Building and purpose: Victor Building in Penn Quarter area of 
Washington, D.C., near the National Mall, used for administrative 
offices; Key elements of disposal decision: Revitalization of area 
where building is located had increased the building's value; the 
Smithsonian determined it could reduce its overall debt by selling, 
moving many of its offices to more cost-effective real estate, and 
leasing back two floors; Date and proceeds: Sold in November 2005 with 
proceeds of $59 million, which went towards relocating occupants to 
leased space and to the Smithsonian trust.[A]. 

Building and purpose: Cinderbed Road warehouse in Virginia used for 
collections storage; Key elements of disposal decision: The Smithsonian 
determined that the building should be sold for a number of reasons, 
including its lack of suitability for collections storage and the 
chance to maximize its underlying monetary value. The property was not 
fully utilized and more cost-efficient locations were available. As a 
short-term solution, the Smithsonian leased back 50 percent of the 
building until it consolidates the collections currently in this 
warehouse into new leased space, at which point it will vacate the 
property; Date and proceeds: Sold in November 2005 with proceeds of 
$8.7 million, which went to the Smithsonian trust. 

Source: Smithsonian Institution. 

[A] Regarding the proceeds from the Victor building, according to 
Smithsonian officials, per instruction from the Smithsonian's auditor, 
the proceeds from this sale were counted as cash in the Smithsonian's 
short-term portfolio and must be recognized at a rate of $4 million per 
year. 

[End of table] 

OFEO has also taken steps to improve the maintenance of its facilities. 
In 2005, we reported that OFEO identified and prioritized maintenance 
projects in conjunction with the museums and other facility groups by 
taking into account customer input; annual safety, health, and 
environmental inspections; code and regulatory requirements; and 
facility assessments. Since that time, it has made its prioritization 
process for maintenance projects more formal by establishing a 5-year 
maintenance plan in which maintenance projects are prioritized using 
the same matrix OFEO developed for capital projects.[Footnote 29] OFEO 
also has been instituting a maintenance and inspection process called 
reliability centered maintenance (RCM) in an attempt to maximize the 
effectiveness of its maintenance resources. This process uses a 
combination of time- based actions, preventive maintenance, and run-to-
failure approaches to reach the most cost-effective approach. OFEO 
officials stated that as part of this process, they completed an asset 
inventory and bar coding of all critical equipment and are in the 
process of inputting this information into a database that will produce 
work plans associated with each maintainable asset using RCM 
technology. The goals are that the system will ensure that predictive 
and preventive maintenance tasks are generated and performed for these 
assets, will contain historical cost and repair information about these 
assets, and will track the scheduling and completion of maintenance 
activities. They stated that the system will provide much more 
empirical data to make decisions with but that staff will need to be 
trained and become comfortable with using the system. They expect it to 
take 1 year before the system's data are fully accurate and useful. 

OFEO has also taken significant steps to develop and use performance 
metrics to monitor the effectiveness of its real property management 
efforts and help with decision making, which is also highlighted in the 
real property management initiative. OFEO has developed over 30 metrics 
that OFEO's director monitors monthly in order to benchmark with other 
organizations and spot possible problem areas. OFEO's metrics cover 
capital planning, project management, maintenance, customer 
satisfaction, worker safety statistics, and other areas. The director 
of OFEO requires staff to report on these metrics each month; the 
director then compiles the results and discusses them with Smithsonian 
leadership at a monthly meeting. According to Smithsonian officials, 
the monthly results of the metrics are also posted on the Smithsonian's 
intranet so that stakeholders throughout the institution can stay 
informed. 

Furthermore, OFEO has taken steps to improve its communications with 
museum and facility directors. OFEO holds regular meetings with museum 
and other facilities' directors in order to discuss and attempt to 
resolve any issues. OFEO also uses customer surveys to elicit feedback 
on maintenance and repair efforts, and it includes the results of these 
surveys as one of its metrics. All of the directors of museums and 
other facilities we spoke with said that OFEO communicates well with 
them. Several of the directors of museums and other facilities who were 
not satisfied with OFEO's customer service when we spoke with them for 
our 2005 report said that OFEO's customer service had improved 
significantly since then. 

Smithsonian's Capital Planning Process Incorporates Many Capital 
Planning Principles: 

The Smithsonian has also taken steps to improve its real property 
portfolio management by refining elements of its capital planning 
process, which incorporates many capital planning principles as defined 
by our prior work and OMB.[Footnote 30] According to our prior work, 
effective capital planning has clear implications for strategic real 
property management because it can help agencies make the most of 
limited resources. A number of laws enacted in the 1990s placed 
increased emphasis on improving capital decision-making practices, and 
OMB's Capital Programming Guide has attempted to address the 
government's shortcomings in this area.[Footnote 31] In recent work, we 
identified five key capital planning principles contained in our and 
OMB's guidance. These principles are strategic linkage, needs 
assessment and gap identification, alternatives evaluation, a review 
and approval framework with established criteria for selecting capital 
investments, and a long-term capital investment plan. The Smithsonian's 
capital planning process incorporates elements of each of these 
principles. 

The Smithsonian's strategic planning and capital planning materials, 
such as its current strategic plan, performance plan, and annual goals, 
articulate strategic linkage between the Smithsonian's mission and the 
Smithsonian's vision for capital planning. Moreover, there is a clear 
link between the Smithsonian's vision for facilities expressed in these 
documents and the Smithsonian's 5-year capital plan. 

Regarding needs assessment and gap identification, the Smithsonian's 
capital planning decision-making process is guided by a comprehensive 
assessment of facilities' conditions and needs and the identification 
of performance gaps between current and needed capabilities. This 
effort to assess needs and identify performance gaps is informed by two 
processes: facilities condition assessments and master planning. 
According to OFEO officials, in July 2006, OFEO implemented a new 
system to conduct condition assessments in order to be able to update 
its condition assessments for all of its facilities annually. This 
system includes a visual assessment and rating of the major building 
systems of each facility to determine the costs of its deferred 
maintenance. OFEO expects to have assessed all of its facilities under 
this system by August 2007. In addition, during this process, OFEO has 
updated the current replacement value of each facility and has found 
that the aggregate replacement value for Smithsonian facilities is $4.7 
billion.[Footnote 32] It is also calculating each facility's facility 
condition index, which is a ratio comparing a facility's current 
replacement value to its deferred maintenance costs that allows the 
Smithsonian to objectively compare its facilities to each other and 
benchmark the condition of its facilities with other facilities in 
order to assist in prioritization and decision making. 

OFEO also uses facilities' master plans to help assess facilities 
projects and identify gaps between current and needed capabilities. 
Currently, some of the Smithsonian's owned facilities have ongoing or 
completed master plans, and the Smithsonian plans to develop master 
plans for the rest of its owned facilities by fiscal year 2015. Master 
plans for facilities such as the Museum of American History include 
information on the current condition of the facility, including 
deficiencies, a plan for correcting these deficiencies, and a vision 
for improving the facility's space in order to enhance the facility's 
ability to meet its mission. According to OFEO officials, when a 
facility has an ongoing or completed master plan, the master plan 
informs the development of projects for the Smithsonian's capital plan. 
According to Smithsonian officials, facilities' master plans also 
incorporate alternatives evaluation by considering several alternative 
ways to meet a facility's defined mission. 

As we reported in 2005, the Smithsonian's capital planning efforts also 
include a review and approval framework with established criteria for 
selecting capital investments and a long-term capital investment plan. 
Each year, OFEO, working with the museums and other facility groups, 
develops an annual list of new and previously submitted projects, which 
are prioritized for inclusion in the annual 5-year capital plan using a 
prioritization matrix previously described in conjunction with the 
Smithsonian's 5-year maintenance plan. OFEO officials stated that they 
have refined this process in recent years. For example, according to 
OFEO officials, the discussions with the museums and research 
institutes now include the maintenance program as well as the capital 
program to ensure that all issues in each facility are taken care of in 
one of the programs. After the capital plan has been revised to reflect 
any new projects or changes in priorities, the updated capital plan is 
reviewed by the Smithsonian's Capital Planning Board[Footnote 33] and 
the Secretary of the Smithsonian. After any revisions are made, the 
Board of Regents approves the Smithsonian's capital plan as part of the 
Smithsonian's annual budget submission to OMB, and then the entire 
budget submission is sent to OMB. 

Funding Constraints Have Presented Considerable Challenges: 

In spite of OFEO's efforts to effectively manage its real property 
portfolio within funding constraints, these constraints have presented 
considerable challenges. OFEO has not had sufficient federal funds to 
address all of the facilities projects identified in its current 
estimate of about $2.5 billion from fiscal year 2005 to year 2013, 
which comes to an average of about $278 million annually. As shown in 
table 2, annual federal capital and maintenance appropriations for 
Smithsonian facilities in recent years have been considerably below 
$278 million. 

Table 2: Smithsonian Institution Facilities Capital and Maintenance 
Appropriations, Fiscal Years 2002-2007: 

Dollars in millions. 

Fiscal year: 2002; 
Facilities capital appropriation: $97.9; Facilities maintenance 
appropriation: $14.5; Total: $112.4. 

Fiscal year: 2003; 
Facilities capital appropriation: 98.8; Facilities maintenance 
appropriation: 17.0; Total: 115.8. 

Fiscal year: 2004; 
Facilities capital appropriation: 107.6; Facilities maintenance 
appropriation: 39.6; Total: 147.2. 

Fiscal year: 2005; 
Facilities capital appropriation: 126.1; Facilities maintenance 
appropriation: 38.2; Total: 164.3. 

Fiscal year: 2006; 
Facilities capital appropriation: 98.5; Facilities maintenance 
appropriation: 45.0; Total: 143.5. 

Fiscal year: 2007; 
Facilities capital appropriation: 98.6; Facilities maintenance 
appropriation: 51.3; Total: 149.9. 

Fiscal year: Total; 
Facilities capital appropriation: $627.5; Facilities maintenance 
appropriation: $205.6; Total: $833.1. 

Source: Smithsonian Institution. 

Note: According to Smithsonian officials, the facilities maintenance 
appropriations for fiscal years 2002 and 2003 reflect the proportion of 
the total salaries and expenses appropriation that went toward OFEO's 
maintenance budget. However, these numbers do not reflect the total 
funds used for maintenance by the Smithsonian for those years because 
some maintenance was funded through individual facilities' budgets 
rather than through OFEO's budget. Starting in fiscal year 2004, all 
facilities maintenance was funded through OFEO's maintenance budget, 
and the Smithsonian's maintenance appropriation reflected a line item 
in the Smithsonian's budget justification request to Congress. 

[End of table] 

Funding constraints have reduced OFEO's ability to implement and 
complete capital projects to address long-standing problems with 
facilities, such as those described earlier in this report. The 
majority of museum and facility directors stated that they think OFEO 
does a good job of prioritizing and addressing problems with the amount 
of funds available, and, as discussed previously, some of the major 
facilities problems they identified to us are scheduled to be addressed 
in the next several years. For example, the electrical systems at the 
Air and Space Museum are scheduled to be replaced in fiscal years 2007 
through 2010. 

However, Smithsonian officials stated that, generally, funding is 
available only for top-priority revitalization and emergency 
maintenance projects. As a result, some high-priority repairs have been 
put on hold while major revitalizations, such as the revitalization of 
the Reynolds Center, are completed. According to OFEO officials, the 
Reynolds Center revitalization became a top priority because the 
building was in such poor condition that it would have become unusable 
without a major revitalization. An OFEO official stated that prior to 
the revitalization, due to problems with the facility's systems, the 
water was undrinkable and there were incidents of bursting valves. 
Several museum and facility directors expressed frustration that 
projects at their facilities had been delayed. For example, the 
director of the Freer and Sackler Galleries expressed frustration that 
fixing the Quadrangle's condensate system, which threatens collections 
and has been a problem since 1993, was originally in the capital plan 
to be fixed in fiscal year 2006 but was delayed until fiscal year 2007 
because of a lack of funding. 

Funding constraints for facilities maintenance have also limited OFEO's 
ability to implement its 5-year maintenance plan. OFEO officials stated 
that current funding enables the execution of only about 30 percent of 
its maintenance plan. As a result, OFEO is never able to get past the 
top-priority maintenance projects in the plan to complete other 
important maintenance projects. According to OFEO officials, a lack of 
sufficient funds for maintenance has limited their ability to optimally 
maintain their equipment, leading to more expensive failures later on 
and to systems that need to be replaced--and thus end up in the capital 
program--sooner than they might otherwise be. 

Some museum and facility directors described reservations about the 
centralization of facilities management under OFEO related to funding 
constraints and maintenance issues. About half of the museum and 
facility directors we spoke with were satisfied with OFEO's centralized 
facilities management approach, and some noted that OFEO has brought a 
higher degree of professionalism to the Smithsonian's real property 
management activities. However, several museum and facility directors 
who were less satisfied with OFEO's centralized facilities management 
approach cited a neglect of day-to-day maintenance due to a lack of 
staffing and funding or greater difficulty getting facilities funds to 
pay for small maintenance or repair projects. 

OFEO officials have attempted to get 2 percent of the Smithsonian's 
facilities' current replacement value for the maintenance budget--which 
is almost entirely federally funded--but they have not been able to do 
so. According to the National Research Council, an industry group, a 
maintenance budget of 2 percent to 4 percent of current replacement 
value is recommended to meet the appropriate maintenance requirements 
of facilities. Although the Smithsonian's maintenance appropriation 
increased in fiscal year 2007, it represented a maintenance budget of 1 
percent of current replacement value. 

The Smithsonian's Omission of Private Funds from Its Capital Plan Has 
Made It Challenging for Stakeholders to Assess the Funding and Scope of 
Projects: 

The Smithsonian's omission of privately funded facilities projects from 
its capital plan has added to its challenges in managing real property 
by reducing the ability of the Smithsonian and other stakeholders to 
comprehensively assess the funding and scope of facilities projects. 
According to OFEO officials, OFEO's efforts related to securing 
increased funds for facilities have centered on more effectively 
justifying to Congress the need for an increase in federal funds for 
facilities. According to OFEO officials, developing a funding strategy 
that goes beyond federal funding is a matter for the Board of Regents 
to determine. 

At the same time, while the Smithsonian has received private funds for 
facilities projects through donations, the Smithsonian has omitted 
privately funded projects from its capital plan. As discussed earlier 
in this report, it also has not included privately funded projects in 
its updated cost estimate of $2.5 billion for facilities projects 
through fiscal year 2013. Its capital plan and cost estimate therefore 
lack comprehensiveness and transparency and do not effectively 
communicate all of the Smithsonian's scope and funding priorities to 
the Board of Regents, OMB, and Congress in a way that could be helpful 
to considering funding strategies that go beyond federal 
funding.[Footnote 34] In prior work, we have identified 
comprehensiveness as an important element of agencies' long-term 
capital plans. 

The Smithsonian includes information on the scope and funding of 
privately funded projects in other documents that are provided to 
stakeholders, such as the capital asset plans (Exhibit 300s) required 
to be submitted to OMB for each major new and ongoing project. However, 
a Smithsonian official described the capital plan as the primary 
document that defines the Smithsonian's long-term capital strategy, and 
the Smithsonian has used its cost estimate for facilities projects 
through 2013 to describe its long-term funding needs for facilities to 
Congress and other stakeholders. These two documents are therefore key 
places where the Smithsonian lays out its overall facilities needs and 
its strategy for addressing those needs. As a result, even though 
information on privately funded projects is detailed elsewhere, the 
lack of such information in these documents limits the ability of the 
Smithsonian and other stakeholders to comprehensively assess the 
funding and scope of facilities projects in the context of the 
Smithsonian's overall facilities' strategy--and de-emphasizes the 
existing and potential role of private funding in this strategy. 

The omission of privately funded projects from these documents is 
particularly noteworthy because in recent years, private funds have 
played an important role in funding some of the Smithsonian's highest- 
priority construction and revitalization projects. According to 
Smithsonian officials, in fiscal years 2002 through 2007, the 
Smithsonian spent $393.4 million in private funds for capital and 
revitalization projects, as shown in table 3. 

Table 3: Funding and Total Cost of Smithsonian Capital Projects That 
Have Received Private Funds for Capital Costs, Fiscal Years 2002-2007: 

Dollars in millions. 

Capital project: National Museum of the American Indian; Private funds 
for capital costs (new construction and enhancements): $80; Federal 
funds for capital costs (new construction and revitalization): $119.3; 
Total capital costs: $199.3. 

Capital project: National Air and Space Museum Steve F. Udvar-Hazy 
Center, Phase I; Private funds for capital costs (new construction and 
enhancements): 176.3; Federal funds for capital costs (new construction 
and revitalization): 8.7; Total capital costs: 185. 

Capital project: National Air and Space Museum Steve F. Udvar-Hazy 
Center, Phase II; Private funds for capital costs (new construction and 
enhancements): 3.7; Federal funds for capital costs (new construction 
and revitalization): 0; Total capital costs: 3.7. 

Capital project: National Museum of American History; Private funds for 
capital costs (new construction and enhancements): 39.2; Federal funds 
for capital costs (new construction and revitalization): 50.7; Total 
capital costs: 89.9. 

Capital project: National Zoological Park; Private funds for capital 
costs (new construction and enhancements): 22.2; Federal funds for 
capital costs (new construction and revitalization): 80.9; Total 
capital costs: 103.1. 

Capital project: Donald W. Reynolds Center; Private funds for capital 
costs (new construction and enhancements): 72; Federal funds for 
capital costs (new construction and revitalization): 166; Total capital 
costs: 238. 

Capital project: Total; 
Private funds for capital costs (new construction and enhancements): 
$393.4; Federal funds for capital costs (new construction and 
revitalization): $425.6; Total capital costs: $819. 

Source: Smithsonian Institution. 

[End of table] 

These private funds have been important in supplementing the 
Smithsonian's federal capital appropriations for facilities projects 
during this time period. For fiscal years 2002 through 2007, the 
Smithsonian received $627.5 million in federal capital appropriations, 
as shown previously in table 2. Therefore, altogether, the 
Smithsonian's funds for capital projects from fiscal years 2002 through 
2007 was slightly over $1 billion ($393.4 million in private funds, 
used for new construction and enhancements, and $627.5 million in 
federal appropriations, used for new construction and revitalization). 
Private funds therefore made up 39 percent of its capital funds for 
facilities during these years. 

Smithsonian officials stated that, generally, donors require that their 
gifts be used toward new construction or enhancements that are part of 
larger revitalizations, and that the majority of these private funds 
were donated for the construction of new facilities--namely, the Museum 
of the American Indian and the Udvar-Hazy Center. Smithsonian officials 
also stated that there is no assurance that private funds would 
continue to make up the same percentage of the Smithsonian's total 
funds for capital projects in future years. 

Other organizations we visited include both private and public 
investments in their capital plans to inform their stakeholders about 
the scope of projects and the extent of such partnerships used to fund 
capital needs. According to a senior vice president at the American 
Museum of Natural History in New York, describing the entire project 
and projected sources of income to the city of New York in the capital 
plan helps the museum make its case with the city and fosters a 
positive relationship. The official also stated that including the 
entire project in the capital plan can help show donors both the 
programmatic link to the museum's capital requests and the support 
expected by the city, which can help with the museum's private fund 
raising. 

Smithsonian officials stated that they do not project future private 
funds in the capital plan because of the uncertainty of what these 
amounts will be. In contrast, the University of California acknowledges 
this uncertainty in its capital plan but, nevertheless, includes 
privately as well as publicly funded projects in its plan, along with 
tentative projections and strategies for meeting those projections. It 
states, for example, that the Berkeley campus seeks funds for capital 
construction through targeted campaigns. In addition, the University of 
California distinguishes in the plan between privately funded projects 
the campus is committed to moving forward on in the 5-year period and 
privately funded projects it would move forward on only when funds are 
available--while including information on both. The lack of such 
information in the Smithsonian's capital plan de-emphasizes the 
potential for private funds to help address facilities projects and 
makes the capital plan less comprehensive in describing the scope of 
planned projects at the Smithsonian's facilities. 

The Smithsonian Has Taken Some Steps to Develop and Implement Funding 
Strategies, but Its Evaluation of Proposed Alternatives Has Been 
Limited: 

The Smithsonian Board of Regents has taken some steps to address our 
April 2005 recommendation to develop and implement a strategic funding 
plan to address its facilities projects. The Board of Regents created 
an ad-hoc committee, which, after reviewing nine funding options, 
requested an increase of $100 million in its federal appropriations, 
but the success of this strategy is uncertain. We found that some of 
the Smithsonian's evaluations of the other eight funding options were 
limited in that they did not always provide complete analysis, fully 
explain specific assumptions, or benchmark with other organizations. 
Also, the evaluations do not consider combining options in order to 
increase the amount of revenue generated. 

To Address Our Recommendation, the Smithsonian Requested an Increase of 
$100 Million in Its Federal Appropriations, but the Success of This 
Strategy Is Uncertain: 

The Board of Regents has taken some steps to address our recommendation 
to develop and implement a strategic funding plan to address the 
Smithsonian's facilities projects. In June 2005, the Board of Regents 
established the ad-hoc Committee on Facilities Revitalization to 
explore options to address the Smithsonian's April 2005 estimated $2.3 
billion for facilities revitalization, construction, and maintenance 
projects through fiscal year 2013.[Footnote 35] In September 2005, the 
ad-hoc committee held a meeting, at which it reviewed nine funding 
options that had been prepared by Smithsonian management for addressing 
this estimated funding need. The nine options are briefly described in 
table 4. 

Table 4: Nine Funding Options Evaluated by the Ad-Hoc Committee on 
Facilities Revitalization: 

Funding option: Federal income tax check-off contribution; Description: 
Federal income tax returns would include a check-off box to allow 
taxpayers to designate some of their tax liability to a special fund 
for the Smithsonian's facilities. 

Funding option: Heritage treasures excise tax; Description: An excise 
tax would be created, and possibly levied on local hotel bills, to 
generate funds for the Smithsonian's facilities. 

Funding option: National fund-raising campaign; Description: The 
Smithsonian would launch a national campaign to raise funds for its 
facilities. 

Funding option: General admission fee program; Description: The 
Smithsonian would institute a general admission charge to raise funds 
for critical but unfunded requirements. 

Funding option: Special exhibition fee program; Description: The 
Smithsonian would charge visitors to attend a select number of special 
exhibitions as a means to raise funds to meet critical but unfunded 
requirements. 

Funding option: Smithsonian treasures pass program; Description: The 
Smithsonian would design a program through which visitors could 
purchase a Smithsonian treasures pass with special benefits, such as no-
wait entry into facilities or behind-the-scenes tours, to raise funds 
to meet critical but unfunded requirements. 

Funding option: Facilities revitalization bond; Description: The 
Smithsonian would borrow funds such as through a private or public debt 
bond for the Smithsonian's facilities. 

Funding option: Closing Smithsonian museums; Description: The 
Smithsonian would permanently or temporarily close museums to the 
public in order to generate savings to help fund its facilities. 

Funding option: Increasing Smithsonian appropriations; Description: The 
Board of Regents and other friends of the Smithsonian would approach 
the Administration about a dramatic appropriations increase to fund 
Smithsonian's facilities. 

Source: Smithsonian Institution. 

[End of table] 

According to Smithsonian regents, after considering these nine proposed 
options, the ad-hoc committee decided to request an increase in the 
Smithsonian's annual federal appropriations, specifically deciding to 
request an additional $100 million over the Smithsonian's current 
appropriation annually for 10 years, starting in fiscal year 2008, to 
reach a total of an additional $1 billion. According to two regents, 
this option was selected for several reasons. First, they stated that 
although the other eight options would generate some funding for the 
Smithsonian's facilities projects, only an increase in appropriations 
had the potential of reaching the April 2005 estimate of $2.3 billion 
for facilities projects in nine years. Moreover, they stated that among 
Smithsonian management and regents, there was a strong feeling that the 
revitalization, construction, and maintenance of Smithsonian facilities 
are federal responsibilities.[Footnote 36] 

According to Smithsonian officials, it is the position of the 
Smithsonian, based on an historical understanding, that the maintenance 
and revitalization of facilities are a federal responsibility. 
Smithsonian officials pointed out that as early as the 1850s, the 
federal government has provided appropriations to the Smithsonian for 
the care of objects belonging to the United States. In addition, the 
regents added that there was a sentiment at the meeting that the Board 
of Regents should not offer to replace public responsibilities with 
private dollars, since private funding can be less reliable than annual 
federal appropriations. 

In September 2006, several members of the Board of Regents and the 
Secretary of the Smithsonian met with the President to discuss the 
issue of increased federal funding for the Smithsonian's facilities. 
According to Smithsonian regents, during the meeting, among other 
things, the regents discussed the problem of aging facilities and the 
need for an additional $100 million in federal funds annually for 10 
years to address the institution's facilities revitalization, 
construction, and maintenance needs. The representatives of the 
Smithsonian at the meeting told the President that they had no other 
options to obtain this $100 million except the Smithsonian's federal 
appropriation. These representatives said the Smithsonian had made 
considerable expense cuts and raised substantial private funds, but 
donors are unwilling to donate money to repair and maintain facilities. 

The President's fiscal year 2008 budget proposal, published in February 
2007, proposed an increase of about $44 million over the Smithsonian's 
fiscal year 2007 appropriation, representing an increase of about $9 
million for its facilities capital appropriation and an increase of 
about $35 million for its salaries and expenses appropriation--which 
includes facilities maintenance.[Footnote 37] However, funds in the 
salaries and expenses appropriation also support many other activities, 
such as research, collections, and exhibitions, and it is not clear how 
much of the $35 million increase the Smithsonian would use for 
facilities maintenance. Moreover, Congress may choose to adopt or 
modify the President's budget proposal when funds are appropriated for 
the fiscal year. According to two regents, while the $44 million 
increase in the President's proposed budget is good news for the 
Smithsonian and its facilities, it does not provide a complete solution 
for the April 2005 estimate of $2.3 billion in facilities projects, 
and, as a result, the Board of Regents will have to consider and 
implement other options. Furthermore, given the previously described 
increase in the Smithsonian's estimate for facilities projects to about 
$2.5 billion, even if the Smithsonian were able to secure a $100 
million increase in its federal appropriations for 10 years, to reach a 
total of an additional $1 billion by 2013, it would not fully address 
the Smithsonian's estimated funding needs for facilities projects. 
Figure 13 shows a timeline summarizing some of the key events that have 
occurred since the Board of Regents established the ad-hoc Committee on 
Facilities Revitalization. 

Figure 13: Timeline of the Ad-Hoc Committee on Facilities 
Revitalization Key Events: 

[See PDF for image] 

Source: GAO analysis of Smithsonian Institute data. 

[End of figure] 

Some of Smithsonian's Evaluations of the Other Eight Funding Options 
Were Limited: 

The Smithsonian's evaluation of the other eight funding options that 
were presented in preparatory materials by Smithsonian management to 
the Board of Regents included the potential benefits and drawbacks of 
each funding option. However, we found that, in some cases, the 
Smithsonian's evaluation of these options was limited in that it did 
not always provide complete analysis, fully explain specific 
assumptions, or benchmark with other organizations--items crucial to 
determining each option's potential for reducing the April 2005 
estimate of $2.3 billion in facilities projects. 

In the preparatory materials, several of the nine options are dismissed 
because, independently, the options would not generate the sizable sums 
required to address the Smithsonian's facilities projects. However, 
there is no mention of combining options in order to increase the 
amount of revenue generated. Combining options has the potential to 
raise more funds to address the Smithsonian's revitalization, 
construction, and maintenance projects at a faster rate than any one 
option independently. In fact, in the wake of the Board of Regents' 
failure to secure an increase of $100 million from the President's 
proposed budget, one regent said that there is no single solution and a 
combination of options will have to be used to fund the Smithsonian's 
facilities projects. An analysis of the potential of combining options 
could have been useful to members of the ad-hoc committee in developing 
a funding strategy for the Smithsonian's facilities projects. 

Evaluation of the Option to Close Museums Is Not Complete: 

In evaluating the option to close museums, the preparatory materials 
provided to the ad-hoc committee did not provide a complete analysis of 
the potential scenarios for closing museums in order to determine how 
this option could be implemented in a way that would maximize cost 
savings while minimizing revenue losses. This is important since the 
Smithsonian based its analysis of this option on the costs saved (i.e., 
for security and custodial staff) versus forgone concession revenue. 
For example, in one scenario, the Smithsonian proposed to close all 
museums on the National Mall 1 day a week (Tuesday), which would result 
in the Smithsonian earning zero concessions revenue from visitors on 
that day. On the other hand, the Smithsonian did not consider closing 
museums 1 day a week on a staggered schedule so that visitors would 
have a choice of some open museums each day of the week. This scenario 
would allow the Smithsonian to capture concessions revenue each day of 
the week--versus the scenario provided in the preparatory materials, in 
which there would be 1 day (Tuesday) with no opportunities for a 
visitor to spend money at the Smithsonian. 

In another scenario, the Smithsonian considered closing all museums on 
the National Mall for 3 days a week, except for the American Indian 
Museum, which would be closed for 2 days a week. Although, unlike in 
the previous scenario, the Smithsonian did stagger the three days on 
which the museums would be closed, the scenario included closing the 
three most visited museums in 2006--Air and Space Museum, Museum of 
American History, and Museum of Natural History--on some of the same 
days (see fig. 14). 

Figure 14: Smithsonian Institution's Scenario for Closing All 
Smithsonian Museums on the National Mall for 3 Days a Week: 

[See PDF for image] 

Source: GAO analysis of Smithsonian Institute data. 

[End of figure] 

As shown in Figure 14, the scenario of closing National Mall museums 3 
days a week included closing all of the art museums on the National 
Mall on the same day two times a week. Furthermore, the Smithsonian 
only considered this one scenario for closing museums on multiple days 
a week, rather than considering several scenarios to find the optimum 
combination of providing visitors with museum variety each day in order 
to maximize potential revenues. For example, Smithsonian did not 
analyze the following scenarios: 

* Limiting the days the three museums with the highest visitation rates 
and concessions earnings are closed, while focusing on closing the 
museums that have the lowest visitation and concessions earnings rates. 

* Ensuring that one or more art museums are open each day so that 
visitors interested in art have an option to visit at least one art 
museum each day--and spend concessions dollars in art museum 
restaurants and stores. 

* Closing only one of the three most visited museums each day to 
provide visitors more choices of where to go and ensure that at least 
two of these museums are capturing revenue. 

In discussing these two scenarios for closing museums, the Smithsonian 
did not explain why these options were evaluated over other options. It 
is also not clear why the Smithsonian chose to evaluate museum closures 
only on the National Mall. The Smithsonian has several other museums 
not located on the National Mall that it could also consider closing to 
save costs. 

Evaluations of the National Fund-Raising Campaign and Treasures Pass 
Program Options Have Unclear Assumptions: 

In the preparatory materials provided to the ad-hoc committee, the 
Smithsonian's evaluation of implementing a national fund-raising 
campaign does not fully explain some of the assumptions used to 
determine the revenues, costs, and length of the campaign described. 
The analysis predicts that a Smithsonian national fund-raising campaign 
could generate $13 million to $16 million and limits the life of the 
campaign to 2 to 4 years. However, it is unclear how the Smithsonian 
developed these revenue and time figures, especially since the analysis 
cites the experiences of other campaigns whose revenue and time figures 
are much different. For example, the analysis describes the experience 
of the campaign for the World War II Memorial, which raised $165 
million in 8 years, or $20.6 million per year. In another example, the 
analysis describes the campaign for the Statue of Liberty and Ellis 
Island Foundation, which raised $540 million in 19 years, or $28.4 
million per year. 

The Smithsonian's analysis also states that a national fund-raising 
campaign would require deferring fund-raising efforts from other 
Smithsonian-wide direct marketing efforts and cost $3 million. However, 
the analysis does not estimate the cost of deferring current fund- 
raising efforts or explain how the $3 million cost assumption was 
derived. Moreover, the analysis suggests that the costs of deferring 
current fund-raising efforts, plus the $3 million to implement a 
national fund-raising campaign, would outweigh any revenue gained; 
however, this might not be the case. 

With regard to the treasures pass program option, the analysis states 
that this option would generate a total annual net revenue of $8.4 
million. This analysis is limited because it assumes that the cost to 
administer this program would be 40 percent of revenues--an estimated 
reduction of $5.6 million per year. However, it is unclear how the 
Smithsonian developed this assumption because its basis was not 
provided or discussed in the preparatory materials. In addition, the 
analysis discusses five other cultural organizations' use and cost to 
visitors of programs similar to a treasures pass program, such as the 
Longwood Gardens in Pennsylvania and the Field Museum in Chicago, but 
the analysis does not include information on these organizations' costs 
to administer this type of program. 

Evaluation of Implementing a General Admission Fee Program Lacks 
Benchmarks: 

The Smithsonian's evaluation of establishing a general admission fee 
program does not use information from other organizations to 
comprehensively assess the option's potential benefits. In some 
instances, the Smithsonian did not perform research with other 
organizations, including one of its own, to gauge if its assumptions 
were reasonable. The analysis provided to the ad-hoc committee in 
preparatory materials states that a general admission fee program-- 
which includes a mandatory admission fee for entry into any museum and 
the National Zoo and revenue from purchases of the Smithsonian's 
membership program that would provide free admission as a benefit -- 
would generate a total annual net revenue of about $57.6 million ($50.7 
million in admission fee revenue plus $6.9 million in new membership 
revenue).[Footnote 38] 

The analysis states that an admission fee could reduce the amount of 
money visitors spend at Smithsonian restaurants and gift stores and 
assumed a 10 percent reduction to annual net gains on the basis of 
visitor surveys. According to the Smithsonian's evaluation materials, 
visitors have indicated that if they had to pay an admission fee to 
enter Smithsonian museums, they would spend less once inside the 
museums. However, the Smithsonian's materials do not benchmark this 
assumption with the experiences of other museums that have established 
admission fees. We spoke with the directors or facility directors of 
six museums and one zoological park who stated that instituting or 
increasing admission fees did not decrease the amount of money visitors 
spent in museum restaurants and stores. One of these museums, the 
Cooper-Hewitt Museum, is the only Smithsonian museum that charges an 
admission fee.[Footnote 39] The Cooper-Hewitt Museum director told us 
that he has not seen an effect on restaurant or gift shop sales when 
admission fees are raised. He stated that the increase in admission 
fees over the past three fiscal years has coincided with a period of 
uninterrupted growth in shop revenues. The stated experiences of these 
other museums suggest that the Smithsonian may need to analyze this 
assumption further by measures such as benchmarking with other museums. 

The Smithsonian's analysis of the general admission fee program also 
included an adjustment of the gross revenues to cover the cost of 
operating and administering an admission fee program. The Smithsonian 
estimates that the cost of operating a general admission fee program is 
20 percent of gross revenues based on the experience of the Department 
of the Interior's National Park Service (NPS) and the Department of 
Agriculture's Forest Service (Forest Service) under the Recreation Fee 
Demonstration Program.[Footnote 40] However, it is unclear in the 
analysis if the Smithsonian consulted directly with NPS or the Forest 
Service to better understand this estimate. According to the First 
Triennial Report to Congress Fiscal Year 2006 on the Recreational Fee 
Demonstration Program,[Footnote 41] the average cost of collections for 
four federal agencies over fiscal years 2000 through 2003 has remained 
constant at about 20 percent of gross fee revenue. However, for fiscal 
year 2003, the cost of collection for NPS was about 22 percent and for 
the Forest Service about 14 percent. While the Smithsonian may have 
chosen to use 20 percent in its analysis because it was the average 
cost of collections for four federal agencies over 4 years, given the 
variation in these numbers and the differences between NPS and the 
Smithsonian, more analysis may be warranted to determine the 
Smithsonian's likely costs of administering an admission fee program. 

For example, the analysis is unclear if the Smithsonian consulted with 
NPS to understand whether NPS's costs to operate the admission fee 
program would be similar to the Smithsonian's costs for an admission 
fee program. According to an NPS official, there are many factors that 
affect the cost to administer the NPS fee program, especially those 
costs related to the method by which fees are collected and 
administered, such as personnel costs, credit card processing costs, 
and the costs to transport and safeguard funds. For example, NPS 
collects fees from about 1,000 locations and has costs associated with 
vehicles--sometimes armored--used to retrieve cash and deposit it into 
a bank. This cost can be high because many locations are geographically 
remote--i.e., the Grand Canyon and parks in Alaska. Since Smithsonian 
museums are not located in geographically remote areas, its costs to 
transport money could be lower than NPS's costs, and, therefore, a 
reason why the NPS fiscal year 2003 estimate of 22 percent to 
administer the Recreational Fee Demonstration Program may not be 
applicable to the Smithsonian. 

We found that museums have different experiences with the costs 
associated with administering an admission fee program, and, therefore, 
it may not have been comprehensive enough for Smithsonian to look at 
the experiences of two federal agencies. An official from the Corcoran 
Gallery of Art--which is located in Washington, D.C., and is a private 
not-for-profit art museum--stated that initially there was a fixed cost 
to implementing the admission collection system, but once the system 
was implemented, the labor costs associated with administering the 
admission fee program were not directly measured because they were 
embedded in the operating costs of the organization. For example, 
employees assigned to administering the tickets serve multiple other 
functions, such as assisting visitors. The Corcoran official also 
stated that the revenue gained from admission fees exceeds the cost of 
administration. An official from the Museum of Modern Art (MOMA)--which 
is located in New York City and is a private not-for-profit art museum-
-expressed a similar point. The official stated that MOMA has no reason 
to measure the cost of administering the admission fee program because 
it is not a direct cost to the museum since this function is one of 
several assigned to museum employees. According to the MOMA official, 
absent an admission fee program, MOMA would still need the same number 
of staff to assist visitors at the museum. 

Two museums that measure the cost to administer the admission fee 
program had different experiences. An official with the Phillips 
Collection--which is located in Washington, D.C., and is a private not- 
for-profit art museum--told us that admission expenses as a percentage 
of admissions gross revenue averaged 26 percent over a 3-year period. 
In contrast, an official from the American Museum of Natural History-- 
which is located in New York City and is a private not-for-profit 
natural history museum--stated that admission expenses as a percentage 
of admissions gross revenue were approximately 13 percent for 2006. 

According to two members of the Board of Regents, the board recognizes 
that it may need to undertake further analysis of the funding options 
presented and consider additional funding options. In June 2007, the 
board voted to turn the ad-hoc committee into a standing Committee on 
Facilities Revitalization. The members of the Board of Regents also 
stated they recognized the need to work closely with Congress on this 
issue in the future. However, these regents told us that in light of 
other priorities, the board has not yet had time to fully reconsider 
funding strategies. 

Conclusions: 

Clearly, the Smithsonian is at a crossroads, with significant 
construction, revitalization, and maintenance projects--including 
security-related projects--needed to better protect the Smithsonian's 
visiting public, staff, facilities, and collections; as well as funding 
constraints that have limited its ability to complete these projects in 
a timely manner. Adding to these strains is that the Smithsonian will 
continue to grow, with the congressionally authorized Museum of African 
American Culture and History. The Smithsonian's strengths in following 
key security practices and taking steps to effectively manage its real 
property portfolio are limited by these funding constraints. 

Moreover, while the Smithsonian has taken steps to effectively 
prioritize security projects, such as developing an all-hazards risk 
assessment report, the lack of awareness of many museum and facility 
directors of this report limits their ability to work with OPS to 
identify, monitor, and respond to changes in the security of their 
facilities, which may limit the Smithsonian's ability to ensure it is 
prioritizing existing resources as effectively as possible to minimize 
security risks. In addition, the Smithsonian's omission of privately 
funded projects from two key documents--its updated cost estimate of 
facilities projects through 2013 and its capital plan--makes these 
documents less transparent and comprehensive and thus of less value in 
communicating the full scope and funding needs of projects for capital 
decision making. The omission of private funds from these documents 
also de-emphasizes the existing and potential role of private funds in 
the Smithsonian's facilities strategy and the Smithsonian's flexibility 
to raise and use private funds for these projects. 

The Smithsonian's lack of resources to address urgent security and 
facilities needs underscores the importance of the Board of Regents' 
efforts to develop a more effective funding strategy. While the Board 
of Regents has considered a variety of funding options, at this point 
in time, it has yet to implement a strategy other than requesting 
increased federal funds. Moreover, since the Board of Regents did not 
analyze the nonfederal funding options in a comprehensive manner, it 
lacks vital information needed to develop a funding strategy that goes 
beyond federal funding. 

Further delays in implementing a viable strategy to fund the 
significant number of facilities projects at many Smithsonian 
facilities increase the risks to these facilities' collections. At some 
point, damage to priceless items may occur, and the ability of the 
Smithsonian to meet its mission will decline. Notwithstanding that the 
federal government has appropriated funds for facilities' 
revitalization, maintenance, and security, the Smithsonian could raise 
additional funds or use existing unrestricted trust funds for these 
purposes. It would appear that the Board of Regents' stewardship role, 
at a time of significant real property challenges and relatively 
constrained federal funds, obligates them to consider providing more 
private funds to meet the funding requirements of its overall mission. 

Recommendations for Executive Action: 

We are making three recommendations to the Secretary of the Smithsonian 
and two recommendations to the Board of Regents. 

To ensure that the Smithsonian's museum and facility directors have the 
information they need to work with OPS to identify, monitor, and 
respond to changes in the security of their facilities, and to increase 
the comprehensiveness of key documents used to present the 
Smithsonian's long-term facilities needs and strategy, we recommend 
that the Secretary of the Smithsonian: 

* ensure that museum and facility directors are aware of and understand 
the all-hazards risk assessment report for their facility, including 
how it affects the prioritization of security projects; 

* ensure that museum and facility directors receive daily information 
related to security issues, including the number of security officers 
assigned to the facility; and: 

* include in the Smithsonian's estimate for facilities revitalization, 
construction, and maintenance projects through 2013 and in the 
Smithsonian's capital plan the full scope of planned projects and 
information on planned funding sources--federal or private funds--for 
each. 

To address the Smithsonian's funding needs for facilities projects, we 
recommend that the Board of Regents: 

* analyze, in a more comprehensive manner, the eight proposed 
nonfederal funding strategies, along with any additional strategies, 
for its facilities projects, including developing a clearer explanation 
of assumptions and incorporating the results of discussions with other 
cultural organizations and a consideration of combining funding options 
in this analysis; and: 

* submit, following its completion of the comprehensive analysis, a 
report to OMB and Congress that describes a funding strategy to meet 
the needs of its revitalization, construction, and maintenance 
projects, so that OMB and Congress can understand the steps the 
Smithsonian is taking to meet these needs in addition to its requests 
for federal funding. 

Agency Comments and Our Evaluation: 

We provided a draft of this report to the Smithsonian for its official 
review and comment. The Smithsonian concurred with the report's 
recommendations and generally concurred with the report's findings, 
including the strengths and challenges related to OFEO's efforts to 
manage the Smithsonian's real property portfolio and the strengths and 
challenges related to OPS's security efforts. Regarding our 
recommendations for improving the Smithsonian's communication on 
security issues, the Smithsonian stated that OPS's leadership 
understands the importance of communication with the management and 
staff of the facilities for which it provides security, and described 
specific actions OPS would take to implement our recommendations. 

Regarding our recommendations to the Board of Regents, the Smithsonian 
stated that the Board of Regents' Committee on Facilities 
Revitalization is working to address the Smithsonian's facilities needs 
through further evaluation of potential funding options. The 
Smithsonian stated that this committee is also planning to review 
existing Smithsonian funding priorities to determine if any funds are 
available to redirect toward facilities needs. Furthermore, the 
Smithsonian stated that the result of these efforts will inform the 
committee's plan to address the Smithsonian's facilities funding 
requirement, which will be presented in draft form to the full Board of 
Regents at its November 2007 meeting and in final form to OMB and 
Congress by the end of the year. 

Although the Smithsonian agreed with our recommendations, the 
Smithsonian expressed concerns about several issues in the report. The 
Smithsonian stated that we implied that the Smithsonian's private trust 
funds offer a solution to the Smithsonian's facilities crisis and that 
we reference the possibility of raising private funds to address 
facilities needs when, according to the Smithsonian, both of these 
approaches have difficulties associated with them. In general, we have 
suggested that both of these approaches may have the potential to 
increase the amount of funds available for the Smithsonian's 
facilities--to some extent. Furthermore, we have concluded that the 
difficulties associated with these approaches and alluded to by the 
Smithsonian underscore the need for our recommendation that the Board 
of Regents analyze a variety of funding options, many of which do not 
depend on convincing donors to give funds for facilities' needs, and 
develop a funding strategy. 

The Smithsonian also stressed its position that the revitalization and 
maintenance of federal facilities are federal responsibilities. We have 
concluded that the Board of Regents' stewardship role, at a time of 
significant real property challenges and relatively constrained federal 
funds, obligates them to consider providing more private funds to meet 
the funding requirements of its overall mission. 

In addition, while the Smithsonian concurred with our recommendation to 
include privately funded projects as well as federally funded projects 
in its capital plan and cost estimate of facilities projects through 
fiscal year 2013, the Smithsonian noted that much of this information 
is already available to stakeholders in other documents. We have 
concluded that, notwithstanding the fact that this information appears 
in other documents, it is important to incorporate it into these two 
documents, as these documents should comprehensively describe the 
Smithsonian's long term facilities' funding needs and strategy. The 
Smithsonian's full comments on our report and our more detailed 
response to these comments can be found in appendix III. 

In addition, the Smithsonian provided separate technical comments, 
which we incorporated into the final report, where appropriate. 

We are sending copies of this report to other interested congressional 
committees, the Chairman of the Smithsonian Board of Regents, and the 
Acting Secretary of the Smithsonian. We will also make copies available 
to others upon request. In addition, the report will be available at no 
charge on the GAO Web site at [hyperlink, http://www.gao.gov]. 

If you have any questions about this report, please contact me at (202) 
512-2843 or goldsteinm@gao.gov. Contact points for our Offices of 
Congressional Relations and Public Affairs may be found on the last 
page of this report. Key contributors to this report are listed in 
appendix IV. 

Signed by: 

Mark L. Goldstein: 

Director, Physical Infrastructure Issues: 

[End of section] 

Appendix I: Scope and Methodology: 

To determine how the condition of the Smithsonian’s facilities has 
changed since our 2005 report, we interviewed the directors, Office of 
Facilities Engineering and Operations (OFEO) zone managers, and 
building managers for 14 Smithsonian facilities to obtain information 
on new facilities projects, continuing problems, and any adverse 
effects on collections. In addition, we toured eight facilities 
identified by the Smithsonian as having major revitalization projects 
or additional facilities-related problems since our April 2005 report 
to view facilities improvements or problems that have limited access to 
or had adverse effects on collections. The facilities we toured were 
the Cooper-Hewitt National Design Museum (Cooper-Hewitt Museum); Donald 
W. Reynolds Center for American Art and Portraiture, which houses the 
National Portrait Gallery and the Smithsonian American Art Museum; 
National Museum of African Art; National Museum of American History 
Kenneth E. Behring Center; National Museum of the American Indian; 
National Museum of Natural History (Museum of Natural History); 
National Zoological Park (National Zoo); and the Smithsonian’s Suitland 
campus, which includes the Cultural Resources Center, Garber Facility, 
and Museum Support Center. The Garber Facility has about 40 buildings, 
and the National Zoo has more than 40 buildings. To obtain information 
on how the cost of Smithsonian facilities projects has changed since 
our 2005 report, we reviewed the Smithsonian’s revised estimated costs 
for major revitalization, construction, and maintenance projects from 
fiscal year 2005 through fiscal year 2008 and interviewed Smithsonian 
officials. 

To determine the steps the Smithsonian has taken to protect its assets 
and the challenges it has experienced, we reviewed key security-related 
documents, such as Smithsonian’s 2002 Disaster Management Program 
Master Plan, 2004 All-Hazards Risk Assessment Report, and 2007 Disaster 
Management Risk Mitigation Plan, Office of Protection Services (OPS) 
policies and procedures, and the Interagency Security Committee’s key 
security practices. We also interviewed appropriate Smithsonian 
officials, including key personnel from OPS and the museum directors 
and building managers of the facilities we visited to obtain 
information on the security challenges OPS and each facility 
experiences. To obtain information on the methodology and purpose of 
some key security-related documents, we interviewed URS Corporation, 
which performed the Smithsonian’s 2004 All-Hazards Risk Assessment 
Report and 2007 Disaster Management Risk Mitigation Plan and Applied 
Research Associates, which performed the Smithsonian’s 2002 Disaster 
Management Program Master Plan. Additionally, we interviewed various 
security organizations and committees on key practices for cultural 
property protection. The security organizations and committees include 
the American Association of Museums, APPA,[Footnote 42] ASIS 
International’s Museum, Library and Cultural Properties 
Council,[Footnote 43] the Federal Facilities Council, the International 
Association of Museum Facility Administrators, and the International 
Facility Management Association and its Museum/Cultural Institutions 
Council. To obtain information on the Smithsonian’s security cost 
trends from fiscal years 2001 through 2005, we reviewed the 
Smithsonian’s federal appropriations, obligations, and expenditures on 
security programs. To obtain information on the Smithsonian’s security 
officer levels, we analyzed monthly staffing reports from March 2003 
through March 2007. We assessed the reliability of the security officer 
data from the Smithsonian by interviewing knowledgeable agency 
officials about data-collection methods, how the data is used, and 
steps taken to test the data. We determined that the data were 
sufficiently reliable for the purposes of reporting on security officer 
levels for March 2003 through March 2007. 

To determine the steps the Smithsonian has taken to improve the 
management of its real property portfolio, we reviewed our prior work 
on this issue and a variety of Smithsonian documents related to its 
real property asset management practices, including handbooks on 
project management, operations and maintenance, and real estate. We 
also reviewed Smithsonian documents related to capital planning and 
master planning, such as the fiscal year 2007 through fiscal year 2012 
Facilities Capital Program, the Museum of Natural History and the 
National Zoo’s master plans, and minutes of the Capital Planning Board 
meetings. To obtain information on the Smithsonian’s fiscal years 2002 
through 2007 facilities capital and maintenance appropriations, we 
reviewed the Smithsonian’s federal appropriations and spoke to 
Smithsonian officials. To obtain information on the Smithsonian’s 
fiscal years 2002 through 2007 private funds, we reviewed audited 
financial statements and spoke to Smithsonian officials. We found this 
data reliable for the purposes of reporting on the amount of the 
Smithsonian’s federal appropriations for fiscal years 2002 through 2007 
used for facilities maintenance, revitalization, and construction. To 
obtain information on the progress of the Smithsonian’s inventory of 
real property, we reviewed data from its real property information 
system. We also reviewed monthly metrics reports to obtain information 
on the Smithsonian’s capital and maintenance benchmarks used for 
decision making. We also interviewed the director and chief of staff of 
OFEO, several heads of the offices making up OFEO, and the staff 
responsible for prioritizing both capital projects and minor repair and 
maintenance. We also reviewed documents relevant to the management of 
real property, such as Executive Order 13327, the Federal Real Property 
Council’s Guidance for Asset Management, the General Services 
Administration’s Federal Management Regulation: Real Property Asset 
Management Guiding Principles, and the Office of Management and 
Budget’s Capital Programming Guide. We also obtained information from 
several facility organizations on key practices related to the 
management of real property portfolios. These organizations include 
APPA, the Federal Facilities Council, the International Association of 
Museum Facility Administrators, and the International Facility 
Management Association. 

To determine the extent to which the Smithsonian developed and 
implemented strategies to fund its revitalization, construction, and 
maintenance projects, we reviewed materials developed by Smithsonian 
management for the consideration from the Board of Regents’ ad-hoc 
Committee on Facilities Revitalization, which included an analysis of 
each of the nine funding options. In addition, we reviewed minutes of 
the Board of Regents’ meetings that document efforts taken to develop 
and implement facilities funding strategies. We interviewed Smithsonian 
management and two members of the Board of Regents’ ad-hoc Committee on 
Facilities Revitalization, including the chairman of this committee, to 
obtain information on how the nine funding options were developed and 
selected for implementation. To obtain information on other 
organizations’ funding strategies for facilities projects, we spoke 
with officials from the Department of the Interior’s National Park 
Service, the Chicago Museum of Science and Industry, the Corcoran 
Gallery of Art, the National Building Museum, and the Phillips 
Collection. We also reviewed the President’s fiscal year 2008 proposed 
budget and the Smithsonian’s annual appropriations from fiscal years 
2005 through 2007. 

To address all of the above objectives, we also conducted site visits 
at organizations in California and New York that have characteristics 
similar to those of the Smithsonian, where we reviewed relevant 
documents, toured facilities, and interviewed officials. In New York, 
we visited the American Museum of Natural History and the Museum of 
Modern Art. In California, we visited the California Academy of 
Sciences; the California State University Office of the Chancellor; San 
Jose State University; San Francisco State University; the University 
of California Office of the President; the University of California at 
Berkeley; the University of California at San Francisco; and the 
Zoological Society of San Diego, including the Wild Animal Park. We 
selected these organizations because they all have some features in 
common with the Smithsonian, including public and private funding, 
capital projects, real property portfolio make-up, and organizational 
mission. We selected New York to efficiently go to two large and 
heavily visited museums with characteristics similar to Smithsonian 
museums. We selected California because several facilities’ management 
experts recommended that a university system with old buildings and 
geographically dispersed campuses would have similar characteristics to 
the Smithsonian, and in California we could efficiently visit the 
University of California system and the California State University 
system, both of which meet these criteria, as well as two other 
organizations with characteristics similar to those of the Smithsonian: 
a large and highly visited zoo and a science academy undergoing a major 
capital construction project. 

We conducted our work in New York City; San Diego and San Francisco; 
and Washington, D.C., from September 2006 to September 2007 in 
accordance with generally accepted government auditing standards.

[End of section] 

Appendix II: Smithsonian's Efforts to Implement Key Security Practices: 

* Allocating resources using risk management. In order to allocate 
resources more effectively to manage risk, in 2002, OPS hired a 
contractor to develop a disaster management program master plan that 
combines disaster and emergency management planning and continuity of 
operations at all levels of the Smithsonian. The program addresses the 
three phases of a disaster or emergency: preparedness, response, and 
recovery. One aspect of the preparedness phase of the program 
recommended developing a risk assessment and risk management program. 
In order to develop the recommended risk management plan, in 2004, the 
Smithsonian contracted for an all-hazards risk assessment report, which 
includes individual assessments for over 30 Smithsonian facilities and 
was completed in 2005.[Footnote 44] These reports identify the primary 
risks to each facility and also describe both the key observed 
vulnerabilities and risks and the key risk reduction and mitigation 
recommendations proposed for each facility to help the Smithsonian 
prioritize security projects. As a supplement to this report, in Spring 
2006, the contractor completed a strategy that included specific 
recommendations on how to use the Smithsonian’s capital and maintenance 
funds to implement future security projects and operational changes 
aimed at reducing the risks for Smithsonian facilities. From this 
strategy, the Smithsonian will develop a new performance metric to 
track risk mitigation efforts across its facilities. Many of the 
protective measures identified in the all-hazards risk assessment 
report have been implemented, will be addressed in the capital program, 
or can be integrated into an ongoing nonsecurity capital project. The 
Smithsonian uses these measures to determine the appropriate capital 
improvements, maintenance projects, and operational procedures to 
reasonably reduce the risk to Smithsonian staff, visitors, collections, 
and facilities. 

* Leveraging security technology. The Smithsonian’s Physical Security 
Plan primarily consists of two separate programs for mitigating the 
risks to the institution’s staff, visitors, collections, and 
facilities. The two programs, the security system modernization program 
and the anti-terrorism program, both leverage security technology to 
protect the Smithsonian’s assets. The security system modernization 
program consists of measures that primarily support cultural property 
protection through the installation of electronic security systems. The 
Smithsonian uses a wide variety of technologies to meet the security 
system modernization program requirements. Smithsonian officials 
reported installing closed circuit television cameras (CCTV) and access 
entry technologies to augment existing security systems or establish a 
new program at some facilities. In addition, the security system 
modernization program plans to install additional electronic systems in 
several other Smithsonian facilities as soon as more funds become 
available. The anti-terrorism program consists of physical security 
measures and procedures that are primarily intended to mitigate the 
risk of a terrorist attack against the Smithsonian. The anti-terrorism 
program includes technologies such as perimeter vehicle barriers, CCTV, 
emergency voice systems, window blast film, and electronic screening of 
visitors and mail. According to a Smithsonian official, the 
technologies used for its physical security plan allow OPS to extend 
the capabilities of security staff and to improve facility security. 

* Performance measurement and testing. Smithsonian officials stated 
that the Smithsonian follows Interagency Security Committee (ISC) 
guidelines for setting performance measures for anti-terrorism measures 
it has implemented, in addition to performing some testing on its own 
security practices. As mentioned above, the Smithsonian is developing a 
measure to track the funding and implementation of recommended risk 
mitigation projects. Also, the Smithsonian designed and tested its own 
vehicle barriers and uses computer modeling to determine the best 
mitigation practices. Regarding OPS operations, the Smithsonian logs 
the number of visitor complaints on security staff and security 
practices at all facilities. To test its disaster response plans, the 
Smithsonian conducts regular mock evacuations. While many of these mock 
evacuations are done without visitors present, according to Smithsonian 
officials, in May 2007, OPS conducted a public evacuation drill of the 
Castle when visitors were present, and a similar drill is planned for 
the National Zoo. Following a mock or an actual evacuation, the 
Smithsonian conducts sessions to identify areas of improvement. For 
example, in June 2006 the Smithsonian had to close facilities affected 
by flooding along the National Mall. Following these closures, the 
Smithsonian held meetings about improving facility evacuations. As a 
result, the Smithsonian altered its Disaster Management Plan because of 
lessons learned from the event, thereby demonstrating quickness in 
response and action. 

* Strategic human capital management. To strategically manage human 
capital as it relates to security, the Smithsonian has instituted 
training courses on terrorism awareness, emergency procedures, and 
shelter-in-place procedures for its security staff. Before September 
11, 2001, security officer training was a two-week program; now the 
program is five weeks long, providing customer service training and 
instruction on the use of magnetometers, X-rays, and bag searches. 

* Aligning assets to mission. Smithsonian officials stated that none of 
its buildings on the National Mall are excess or underutilized, and, 
therefore, opportunities to align assts to mission by reducing excess 
or underutilized property in order to reduce overall vulnerabilities 
are limited. However, according to Smithsonian officials, any future 
building disposals will include the consideration of reducing security 
costs in order to more effectively use security resources at fully 
utilized buildings. 

* Information sharing and coordination. Smithsonian officials reported 
sharing and coordinating information with several external stakeholders 
through periodic meetings with many government and private sector 
organizations. As a national icon located on the National Mall, the 
Smithsonian coordinates with several law enforcement entities, 
including the Federal Bureau of Investigation, the Department of 
Homeland Security; the U.S. Park Police, the Metropolitan Police 
Department, and a local Joint Terrorism Task Force.[Footnote 45] In 
addition, OPS also shares information with government and private 
sector security groups including ASIS International’s Museum, Library 
and Cultural Properties Council, Interagency Security Committee, and 
the National Monuments and Icon Sector of the National Infrastructure 
Protection Plan. 
 
[End of section] 

Appendix III: Comments from the Smithsonian Institution: 

Smithsonian Institution: 
Cristian Samper: 
Acting Secretary: 

September 19, 2007: 

Mr. David M. Walker: 
Comptroller General: 
Government Accountability Office: 
441 G Street, NW: 
Washington, DC 20548: 

Dear Mr. Walker: 

On behalf of the Smithsonian Institution, thank you for this 
opportunity to respond to your report Smithsonian Institution: Funding 
Challenges Affect Facilities Conditions and Security, Endangering 
Collections. We are pleased that the Government Accountability Office 
(GAO) expended significant time and effort over the last year to meet 
with our staff, tour our facilities, and review our documentation in 
order to understand the magnitude and complexity of the Smithsonian's 
facilities and security challenges. We are also pleased that GAO 
recognizes the significant strides we have made in improving the 
management of our facilities. 

We accept all of the recommendations outlined in your report and agree 
to: 

1. Improve the level of communication between the Office of Protection 
Services (OPS) and our museum and facility directors by making them 
more aware of the multi-hazard risk assessment and its impact on the 
prioritization of security projects and providing them with daily 
information related to security issues, including the number of 
security officers assigned to their facilities; and: 

2. Increase the comprehensiveness of documents that describe our 
facilities' funding needs by adding private trust funds to the funding 
sources listed on our five-year capital plan and our estimate for 
facilities revitalization, construction, and maintenance projects 
through 2013. 

In addition, the Smithsonian Board of Regents is already in the process 
of addressing GAO's third recommendation and is: 

3. Analyzing more comprehensively additional strategies for addressing 
our facilities needs. (As requested, the Board of Regents will submit a 
report to the Office of Management and Budget and Congress by the end 
of 2007 that describes a funding strategy to meet the Smithsonian's 
needs for revitalization, construction, and maintenance.)

Smithsonian Facilities: Challenges and Successes: 

As GAO learned over the course of its 12-month review, the Smithsonian 
is responsible for the operations, maintenance and repair of hundreds 
of structures located on the National Mall and in the Washington 
metropolitan area, but also in many other locations around the United 
States and the world. This family of facilities includes National 
Historic Landmarks, research labs, collections storage areas, office 
buildings and a wide array of other structures, all possessing a unique 
set of expected functions and maintenance and security challenges. 
Keeping pace with the constant daily needs of these facilities is the 
full-time job of thousands of Smithsonian employees, each of whom takes 
pride in the scientific discoveries, educational endeavors, and 
stimulating experiences that these buildings make possible. Ensuring 
the fitness and safety of our facilities—and the people and collections 
that are housed within them—is one of the most important 
responsibilities that the Smithsonian owes the American people. 

We are pleased that you recognized the significant strides made by the 
Smithsonian's Office of Facilities, Engineering and Operations (OFEO) 
since GAO's last report. Since 2005, OFEO has completed the integration 
of our facilities functions into one office, greatly improving 
efficiency and coordination of our efforts in this area. This 
reinvigorated structure has enabled OFEO to perform a critical assets 
inventory of over 10,000 operating components, each with work plans, to 
enable our use of a Reliability Centered Maintenance approach. This has 
resulted in a reduction in failures of major equipment by 20 percent. 
We have also initiated a massive energy conservation effort that has 
resulted in more than $5 million in savings over the past 18 months. 
These successes led OFEO to be named the 2006 National Winner of the 
APPA (Association of Higher Education Facilities Officers) Award for 
Excellence in Facilities Management and enabled the Institution to 
achieve the highest rating by OMB on the Program Assessment Rating Tool 
(PART) evaluations for both the Facilities Capital and the Facilities 
Operations and Maintenance programs. 

These accomplishments aside, we acknowledge GAO's findings here and in 
its 2005 report that we continue to face significant challenges in 
addressing the $2.5 billion of revitalization, construction and 
maintenance requirements that are on hold due to a lack of funds. These 
financial limitations also make more difficult the critical task of 
ensuring the security of our buildings and the safety of our visitors, 
staff and collections. 

The examples of facilities problems cited in GAO's report are but some 
of the structural, mechanical and aesthetic needs that cannot be met 
because we simply do not have the funds to do so. Without sufficient 
financial resources, failing mechanical systems cannot be replaced, 
recurring roof leaks cannot be eradicated, and worn fixtures cannot be 
upgraded. Our current funding enables the Institution to respond only 
to the most critical of needs: those that could threaten public safety, 
cause damage to collections, or pose significant limits on public 
access or operability. This focus leaves out the necessary routine 
maintenance that prevents small problems from growing into big ones 
that ultimately cause more damage and cost more to fix, and delays the 
planned replacement of aged building systems before they reach the 
breakdown stage. 

Yet, if additional funding could be secured, the Smithsonian has proven 
that it would be able to wisely and efficiently spend it to fix these 
problems. Over the last five years, our obligation rate for facilities 
capital projects has averaged above 90 percent, while the obligation 
rate for facilities maintenance (one-year appropriation) has been 
greater than 99.9 percent. This shows that even with limited funding, 
the Smithsonian has managed to resolve a number of significant 
facilities problems and could do more with increased funds. Some recent 
highlights include roof repairs at the National Museum of Natural 
History to correct leaks into collections areas as well as offices; 
repair of numerous leaks in the Quadrangle roof garden that were 
threatening collections and galleries; and replacement of high-voltage 
distribution systems at the Conservation Research Center. We have also 
paid significant attention to fire protection needs at the National 
Zoological Park, installing new systems at the Rock Creek and Front 
Royal facilities. Further fire protection projects at the Zoo are in 
the Capital Plan, and all are scheduled to be completed over the next 
five years. 

Facilities Revitalization is a Priority of the Smithsonian Board of 
Regents: 

The Smithsonian Board of Regents takes very seriously the Institution's 
facilities crisis and is currently engaged in a significant effort to 
address it. As GAO mentioned in its report, in June 2005 the 
Smithsonian Board of Regents established an Ad-Hoc Committee on 
Facilities Revitalization to evaluate funding strategies to address 
this issue. In June 2007, the Board voted to make this group a standing 
committee of the Board of Regents—an acknowledgement of this 
challenge's importance to the future health of the Institution. 

Since this Committee was made permanent, members have met with senior 
staff to evaluate the range of revitalization, construction and 
maintenance needs and to assess the prioritization of these 
requirements. This summer, at the request of the Committee, senior 
Smithsonian staff updated and augmented the funding options papers 
described by GAO in this report and researched additional funding ideas 
that were suggested by the Regents and other sources. These funding 
options were discussed by the Committee during its September meeting 
and are on the agenda for its next meeting in October. At that time, 
the Committee will evaluate each option individually and in 
combination. In the interim, the Committee is reviewing facilities 
funding strategies undertaken by similar entities and will reach out to 
external stakeholders to generate further ideas. In addition, the 
Committee will review existing Smithsonian funding priorities to 
determine if any funds are available to redirect toward facilities 
needs. The results of these efforts will inform the Committee's plan to 
address the facilities requirement. This plan, which was previously 
requested by Senate Rules Chair Dianne Feinstein (D-CA), will be 
presented in draft form to the full Board of Regents at its November 
meeting, and, as requested by GAO, in final form to OMB and Congress by 
the end of the year. 

Importance of Federal Role in Maintaining Smithsonian Facilities: 

While the plan will provide a blueprint for how the Smithsonian can 
supplement government funding to address this crisis, the federal role 
in ensuring the welfare of the Institution's buildings cannot be 
overstated. In the years after Congress passed the law establishing the 
Smithsonian in 1846, the federal government began transferring existing 
objects and directing that new ones be housed at the Smithsonian. 
Starting in 1858, in acknowledgement of the costs associated with this 
responsibility, the Congress began providing an annual appropriation to 
the Smithsonian for the care of what became known as the National 
Collection. Since then the size of the National Collection—which 
includes everything from historic artifacts to priceless paintings to 
rare animals—has grown to include more than 136 million objects, 
artworks and specimens. More than 23 million visitors came through our 
doors last year to glimpse the wonder and wisdom contained in these 
precious objects and living things. Since the safety and soundness of 
our buildings is directly related to our ability to successfully 
preserve, study, and display these collections, it is only fitting that 
taxpayer dollars be used toward this noble purpose. The Smithsonian is 
grateful to the Congress and the people of the United States for the 
annual appropriation it receives each year, a large portion of which 
goes toward operating and maintaining our buildings. 

Limits of Smithsonian Trust Funds in Addressing Facilities Funding 
Challenges: 

As a Federal trust instrumentality, the Smithsonian also relies 
significantly on private funding to carry out its mission. Monies 
brought in from donors and revenue-generating enterprises make up about 
a third of the Institution's annual revenues. Although GAO has implied 
in its report that these trust funds offer a solution to our facilities 
crisis, a review of the current uses of these funds shows the 
difficulties associated with this approach. The majority of Smithsonian 
trust funds are given by a donor for a specific purpose and thus cannot 
be diverted to pay for building operations, repairs or maintenance. The 
remaining unrestricted trust funds budgeted annually, about $58 million 
in FY 2006, cover administrative and mission-related costs that either 
cannot be paid for with, or are not completely supported by, Federal 
funds. And while a portion of these unrestricted funds does consist of 
an annual payout from our endowment, prudent financial management 
guidelines dictate that this amount should not exceed 5 percent of the 
five-year average endowment value (a formula that currently yields an 
annual payout of about $13 million). Additionally, drawing down the 
unrestricted endowment principal in a special payout would reduce the 
annual future payout, providing only a limited one- time infusion of 
funds. In sum, using unrestricted trust funds for building repairs and 
maintenance provides illusory benefits because it would require the 
Institution to eliminate multiple programs and positions for which 
there are no funding alternatives, compromising our educational and 
scientific mission while having almost no impact on the $2.5 billion 
facilities requirement. 

GAO's report also references the possibility of raising private funds 
specifically to address facilities needs. While the Smithsonian is 
certainly open to the idea of soliciting and accepting gifts from 
donors for this purpose, the lack of success we and other Institutions 
have had with this approach indicates that it may only have limited 
value. While donors have given generously toward the construction of 
new facilities and major enhancements of existing facilities, we have 
found that most donors believe that the Smithsonian's operations, 
revitalization, and maintenance costs are a Federal responsibility. In 
fact, many are more likely to make a gift if it can enhance a project 
already supported by Federal funds. 

The Smithsonian and many other public and nonprofit institutions have 
found that donors make gifts to institutions primarily to support 
programs for which they have a passion or to establish a legacy that 
will benefit future generations. As a result, most institutions with 
comparable facilities maintenance and operations funding challenges 
have not been able to attract donors who are willing to give 
substantially toward repairing damaged roofs or replacing aging wiring 
without being able to relate this to a program or project that reflects 
the programmatic mission of that institution. In April 2007, the 
Smithsonian commissioned an independent philanthropic management 
consultant to survey similar nonprofit and public entities on this 
topic. The consultant's report concluded that "Although several 
institutions noted that the need to improve infrastructure and address 
the costs of deferred maintenance is an ongoing concern, all reported 
that effort to secure support for these purposes has been unsuccessful, 
except when embedded in programmatic improvements." So while the 
Smithsonian remains open to investigating the level of interest of 
private donors to address our revitalization and maintenance 
requirements, we do not believe that this option alone will suffice to 
solve the $2.5 billion problem. 

Smithsonian Security Record is Strong Even With Limited Resources: 

While we agree to implement GAO's recommendations regarding 
communication with directors about our security operations, we believe 
that our security and safety record is outstanding even with the 
personnel shortages and funding challenges we face. The Smithsonian's 
Office of Protection Services (OPS) and the professional security 
officers that make up its force are directly responsible for the safety 
and security of the people and collections that are housed in our 
buildings. Although we take seriously the individual incidents that GAO 
pointed out in its report, given the hundreds of buildings OPS is 
responsible for monitoring, the thousands of people who visit and work 
in our buildings each day, and the millions of collections we house, we 
believe the OPS security record is commendable. Incidents of theft and 
other crimes are extremely rare, as evidenced by our Total Recordable 
Crimes Rate, which is well below the average for museums and zoos. 
Responses to emergencies are swift and professional, such as the 2006 
mall-wide evacuation that required Smithsonian security personnel to 
shelter-in-place thousands of people fleeing a Fourth of July 
thunderstorm. And design elements and planning for natural disasters, 
terrorist attacks, and other major incidents are done to the highest 
standards, leading other organizations to cite our Glass Hazard 
Mitigation Program and our Mall-Wide Perimeter Barrier program as 
benchmarks in the field. 

However, recruiting and retaining qualified security personnel to carry 
out these duties remains a major challenge and one that we are working 
to resolve. As part of this effort, the Smithsonian plans to commission 
a study of the security staffing levels in our facilities that will 
yield a plan outlining appropriate staffing for high- and low-risk 
operations. We will continue to seek innovative ways to recruit and 
retain talented individuals for these important positions. 

The OPS leadership also understands the importance of meaningful and 
regular communication with the management and staff of the facilities 
for which it provides security. Senior OPS officials already meet 
yearly with each facility director to discuss security challenges and 
changes for the coming year, and building security managers and 
officers are available on a daily basis to respond to questions or 
concerns. In response to GAO's recommendations, the OPS Director will 
meet one additional time per year with each facility director to 
discuss specific security plans and issues. While OPS distributed the 
most recent Multi-Hazard Risk Assessment to all facility directors, it 
is clear from GAO's report that not all directors were aware of that 
document. Therefore the agenda for these bi-annual meetings will also 
include a discussion of that risk assessment. In response to GAO's 
concerns about a lack of available information on security staffing 
levels at museums and other facilities, OPS will now send a daily 
security roster to each facility and museum director. 

Role of Trust Funding in Smithsonian Capital Plan and Overall 
Facilities Budget: 

The Smithsonian agrees with and will implement GAO's recommendation to 
incorporate more trust fund information in the next iteration of the 
Capital Plan, which will support the FY 2009 budget request when it is 
presented to Congress in February 2008. Based on this information, the 
Institution will recalculate the total requirement for capital and 
maintenance. 

While we agree this approach will prove beneficial to internal and 
external stakeholders, we note, however, that much of this information 
is already available to them. From the time major projects with private 
funding are presented for Smithsonian management approval through 
execution of each project, full and detailed Federal and trust funding 
information is provided to decision makers, both internally and 
externally. For example, the Capital Plan already includes projects 
that receive private funds, and Federal budget justifications in the 
past several years for such projects as the National Museum of American 
History revitalization and the National Zoological Park Asia Trail 
project reference the trust funds associated with those projects. 
Further, the Institution provides very detailed information on the 
Federal and trust funding projections for major projects in the Exhibit 
300s provided each year to OMB. In addition, a variety of reports are 
provided to internal stakeholders at a number of levels, including the 
summary "tripod" charts, executive and oversight committee 
presentations, and the operational review presentation to the Secretary 
three times a year. Examples of some of these documents were provided 
to GAO during its review. External stakeholders such as OMB and 
Congress receive information on required funding—from all sources—as 
part of the project authorization process (for construction/expansion 
projects), as well as part of the appropriations process (in the budget 
narratives and during hearings and follow-up questions for the record). 
External review agencies such as the National Capital Planning 
Commission also receive information on total project funding in the 
annual submission for the Federal Capital Improvements Program. As 
these examples attest, the Institution is committed to ensuring that 
stakeholders at all levels have complete funding information to 
facilitate appropriate decisions in the management of its real property 
inventory. 

We appreciate GAO's efforts to conduct this thorough and fair review of 
our facilities and security responsibilities and funding needs. There 
is no question that the $2.5 billion facilities requirement is one of 
the most important challenges the Smithsonian faces. We must not lose 
sight, however, of the need to continue advancements and improvements 
in our programs as well, an area in which our donors have been 
extraordinarily generous. We pledge to do our part to address these 
significant funding challenges, and the Smithsonian and the Board of 
Regents look forward to working with Congress to tackle these issues. 

Sincerely, 

Signed by: 

Cristian Samper: 

Acting Secretary: 

The following are GAO’s comments on the Smithsonian Institution’s 
letter dated September 19, 2007. 

GAO Comments: 

1. The Smithsonian cited in its letter some accomplishments of its 
facilities management approach. While our report discusses steps the 
Smithsonian has taken to improve the management of its real property 
portfolio, we did not evaluate all of the accomplishments cited in the 
Smithsonian’s letter. 

2. The Smithsonian stressed in its response that both the Smithsonian 
and donors believe that the revitalization and maintenance of the 
Smithsonian’s facilities are federal responsibilities. We recognize 
that the federal government has played—and is likely to continue to 
play—an important role in funding the Smithsonian’s facilities needs. 
However, as the Smithsonian has not received sufficient funds from the 
federal government to meet its facilities needs in recent years, and in 
light of the threat posed by many deteriorating facilities to the 
Smithsonian’s collections and the public’s access to these collections, 
we have concluded that the Board of Regents’ stewardship role, at a 
time of significant real property challenges and relatively constrained 
federal funds, obligates them to consider providing more private funds 
to meet the funding requirements of its overall mission. 

3. The Smithsonian expressed concern that we implied that the 
Smithsonian’s private trust funds offer a solution to the Smithsonian’s 
facilities crisis. In our report, we pointed out that unrestricted 
trust funds could be used for facilities needs, including maintenance, 
revitalization, or security needs, but have not been used for such 
purposes. We recognize that such funds made up 6 percent of the 
Smithsonian’s operating budget in fiscal year 2006 and went towards 
other expenses. We did not analyze the Smithsonian’s decision-making on 
how it distributed these unrestricted funds; however, it appears that 
the stated plan of the Smithsonian’s Board of Regents’ Committee on 
Facilities’ Revitalization to review existing funding priorities to 
determine if any funds are available to redirect toward facilities 
needs is a positive step. The focus of our report is on the need for 
the Smithsonian to develop new strategies to raise additional revenue 
in order to significantly increase the amount of unrestricted funds 
that are available to be used for facilities needs. 

4. The Smithsonian expressed concern that we referenced the possibility 
of raising private funds to address facilities needs, and the 
Smithsonian stressed the difficulty of raising funds from donors for 
the operations, revitalization, and maintenance of facilities. The 
difficulty described by the Smithsonian of raising such funds from 
donors underscores the need for the Smithsonian to develop new funding 
strategies—that do not rely on individual donors’ preferences—to raise 
revenue for these needs. For example, most of the eight funding options 
that the ad hoc committee on facilities revitalization considered (in 
addition to the option of seeking increased federal funds) and that we 
describe in our report do not depend on convincing donors to provide 
funds for facilities. Indeed, this difficulty demonstrates the 
importance of our recommendation that the Board analyze these eight 
proposed funding strategies in a more comprehensive manner in order to 
develop and implement a funding strategy. At the same time, the finding 
of the Smithsonian’s commissioned report on fund-raising that all 12 
organizations surveyed reported that the effort to secure support for 
deferred maintenance has been unsuccessful, except when embedded in 
programmatic improvements, describes both a perceived difficulty in 
securing private funds for deferred maintenance in general, but also 
the potential to do so when such projects are embedded in programmatic 
improvements. 

5. While the Smithsonian concurred with our recommendation to include 
privately funded projects as well as federally funded projects in its 
capital plan and cost estimate of facilities projects through fiscal 
year 2013, the Smithsonian noted that much of this information is 
already available to stakeholders in other documents and during 
processes such as congressional hearings. We recognize the Smithsonian 
includes information on privately funded projects in various documents 
that go to OMB, Congress, and other stakeholders. However, given that 
the capital plan is the primary document that defines the Smithsonian’s 
long-term capital strategy, and that the Smithsonian has used its cost 
estimate for facilities’ projects through 2013 to describe its long-
term funding needs for facilities to Congress and other stakeholders, 
it is important that private trust funds be included in these documents 
so that the documents will provide a comprehensive picture of the full 
scope of facilities needs and the Smithsonian’s long-term strategy for 
meeting those needs. 

[End of section] 

Appendix IV: GAO Contact and Staff Acknowledgements: 

GAO Contact: Mark L. Goldstein, (202)512-2834 or goldsteinm@gao.gov. 

Staff Acknowledgements: In addition to the contact named above, David 
Sausville, Assistant Director; Brandon Haller, Susan Michael-Smith; 
Alwynne Wilbur; Carrie Wilks; and Adam Yu made key contributions to 
this report. 

[End of section] 

Footnotes: 

[1] GAO, Smithsonian Institution: Facilities Management Reorganization 
Is Progressing, but Funding Remains a Challenge, GAO-05-369 
(Washington, D.C.: Apr. 25, 2005). 

[2] The Smithsonian’s private trust funds are divided into two 
categories: restricted and unrestricted. Restricted trust funds must be 
used for specified purposes. Unrestricted trust funds can be used to 
support any Smithsonian activity. 

[3] GAO, Smithsonian Institution: Funding for Real Property Needs 
Remains a Challenge, GAO-07-725T (Washington, D.C.: Apr. 11, 2007). 

[4] GAO, High-Risk Series: Federal Real Property, GAO-03-122 
(Washington, D.C.: January 2003); and Federal Real Property: Progress 
Made toward Addressing Problems, but Underlying Obstacles Continue to 
Hamper Reform, GAO-07-349 (Washington, D.C.: Apr. 13, 2007). 

[5] For this report, the term museum and facility directors refers to 
directors of museums, directors of nonmuseum facilities, such as 
research and storage centers, and key facilities and security managers 
of these museums and facilities. 

[6] GAO, Homeland Security: Further Actions Needed to Coordinate 
Federal Agencies’ Facility Protection Efforts and Promote Key 
Practices, GAO-05-49 (Washington, D.C.: Nov. 30, 2004). 

[7] A trust is a fiduciary relationship involving a right of property 
held by the trustee for the benefit of another. 

[8] The three senators are appointed by the President of the Senate, 
the three representatives are appointed by the Speaker of the House, 
and nine citizens are appointed by joint resolution of Congress—two 
from the District of Columbia and seven from the states. 

[9] The Udvar-Hazy Center near Washington Dulles International Airport 
is the companion facility to the Air and Space Museum on the National 
Mall and is being built in two phases. Phase I opened in December 2003 
and provides enough space for the Smithsonian to display thousands of 
aviation and space artifacts. Phase II will include a restoration 
hangar, archives, collections processing unit, conservation laboratory, 
and collections storage facility. 

[10] Several bills have been introduced in the 110th Congress to study 
the potential creation of a National Museum of the American Latino and 
whether the museum should be located within the Smithsonian. See S. 
500, 110th Cong. (2007); and H.R. 512, 110th Cong. (2007). 

[11] GAO-05-49. 

[12] In October 1995, the President signed Executive Order 12977 to 
establish ISC, which is chaired by the Department of Homeland Security 
and has representation from all of the major federal real property 
holding agencies. ISC has three primary security responsibilities for 
nonmilitary activities: (1) establish policies for security in and 
protection of federal facilities; (2) develop and evaluate security 
standards for federal facilities, develop a strategy for ensuring 
compliance with such standards, and oversee the implementation of 
appropriate security measures in federal facilities; and (3) take such 
actions as may be necessary to enhance the quality and effectiveness of 
security and protection of federal facilities. 

[13] The Office of Facilities Engineering and Operations (OFEO) 
consists of six offices, including Planning and Project Management; 
Engineering, Design, and Construction; Facilities Management and 
Reliability; Protection Services; Safety, Health and Environmental 
Management; and Smithsonian Tropical Research Institute Facilities 
Operations. 

[14] According to Smithsonian officials, for fiscal year 2004, the 
Smithsonian’s budget justification to Congress was realigned to 
accommodate facilities integration from the museums, other facilities, 
and the National Zoo, as well as to reorganize the resources into the 
categories of facilities maintenance, facilities operations, security 
and support, and facilities capital. 

[15] According to Smithsonian officials, the Smithsonian disputes the 
IRC report’s finding that overall private fund-raising declined during 
the former secretary’s tenure. 

[16] The legislation authorizing the construction of the National 
Museum of African Art referred to a center for Eastern art or studies. 
See 20 U.S.C. § 50 note. The Smithsonian Quadrangle complex houses the 
National Museum of African Art, the Arthur M. Sackler Gallery, S. 
Dillon Ripley Center, an auditorium, offices, and the Enid A. Haupt 
Garden. On July 28, 1982, the Smithsonian entered into an agreement to 
name the western half of the Quadrangle complex the Arthur M. Sackler 
Gallery, which was to be dedicated to Eastern Art. 

[17] In addition to significant collections from the United States, the 
Museum of the American Indian’s collection also contains items from 
throughout the Western Hemisphere. 

[18] In this condensate system, steam is piped to humidifiers located 
throughout the Quadrangle complex, which inject the steam into the air 
flow to provide humidification. However, when these pipes periodically 
clog up with metallic sediment, the steam turns into water and leaks 
through pipe joints. 

[19] The law that authorized the National Air and Space Museum Stephen 
F Udvar-Hazy Center provided that no appropriated funds could be used 
to pay for construction expenses. See 20 U.S.C. § 77 note. 

[20] According to Smithsonian officials, a small amount of unrestricted 
trust funds have been used towards the salaries of some facilities’ 
maintenance managers. According to Smithsonian officials, restricted 
trust funds have not been available for maintenance, as donors are not 
interested in giving money towards facilities’ maintenance and do not 
donate funds for this purpose. The Smithsonian recently commissioned a 
benchmarking survey on fund-raising for facilities; all 12 respondents 
to the survey reported that efforts to secure support for deferred 
maintenance have been unsuccessful, except when embedded in 
programmatic improvements. 

[21] A master plan is a proposal of a comprehensive renovation or 
expansion of a complex that aligns the physical plant with the 
organization’s strategic goals. It includes proposals to make the 
complex conform to current codes and meet technology and security 
requirements. This process can also involve upgrading and replacing 
major building systems, including the electrical, plumbing, fire 
suppression, and heating and air conditioning systems; reinforcing the 
complex’s structural integrity; and removing asbestos. Master plans 
also identify changes in building use and expansion requirements to 
meet mission needs. 

[22] According to Smithsonian officials, OPS consulted with the Federal 
Emergency Management Agency (FEMA) on the methodologies and consultants 
to use for the 2005 all-hazards risk assessment report. For a 
methodology, FEMA recommended its Risk Management Series Publication 
452. For consultants, FEMA recommended the entity used to create the 
FEMA 452 Publication. 

[23] According to Smithsonian officials, it is the position of the 
Smithsonian that the security of facilities is a federal 
responsibility, based on an historical understanding as well as 
accepted practice among federal entities. While Congress does 
appropriate funds every year for security expenses, the Smithsonian 
could raise additional revenue or use unrestricted trust funds for its 
security expenses. 

[24] GAO, Federal Law Enforcement: Selected Issues in Human Capital 
Management, GAO-03-1034T (Washington D.C.: July 23, 2003). 

[25] The National Historic Preservation Act (NHPA) requires federal 
agencies to consider the effect of their actions on historic properties 
and to undertake planning and actions necessary to minimize harm to the 
historic property. The Smithsonian Facilities Authorization Act of 
2003, 20 U.S.C. § 75b note, states that in carrying out projects in the 
District of Columbia that are subject to the review and approval of the 
National Capital Planning commission, the Smithsonian Institution shall 
be deemed to be an agency for purposes of compliance with regulations 
promulgated by the Advisory Council on Historic Preservation pursuant 
to section 106 of the NHPA. The standards require owners to maintain 
the original structure, fabric, and character of the site (both 
interior and exterior) when making additions or upgrades. 

[26] This prohibition was included in the Smithsonian’s appropriations 
acts for fiscal years 2005 and 2006. (Public Law 108-447, 118 Stat, 
3089 (2004); Public Law 109-54, 119 Stat. 545 (2005). The Smithsonian’s 
appropriations acts for fiscal years 2002 through 2004 contained a 
similar prohibition, except that for these years, approval to close 
such facilities was required from the Smithsonian’s Board of Regents 
acting on recommendations from the Science Commission rather than from 
the House and Senate Committees on Appropriations. (Public Law 107-63, 
115 Stat. 461 (2001); Public Law 108-7,117 Stat. 11 (2003); Public Law 
108-108; 117 Stat. 1298 (2003). 

[27] OFEO officials stated that they are not attempting to reconfigure 
spaces that are not being renovated to meet the space guidelines, as 
this is not a high priority, but that moving forward, renovations of 
existing space will incorporate these guidelines. 

[28] In addition to the performance measures, the 24 data elements 
include elements designed to identify the property and describe the 
property’s type, use, status, size, value, and restrictions. 

[29] Under OFEO’s prioritization matrix, each project is assigned one 
of four condition levels (catastrophic, critical, routine, and can 
defer) and one of five project types (shell/system failure, code 
compliance/security, nonroutine capital repairs, energy/operational 
efficiency, and alternations and modifications). This assignment 
determines the project’s priority code, which may be from one (top 
priority for the budget year in which funding is sought) to five 
(lowest priority). 

[30] GAO, Federal Capital: Three Entities’ Implementation of Capital 
Planning Principles Is Mixed, GAO-07-274 (Washington, D.C.: Feb. 23, 
2007); GAO, Executive Guide: Leading Practices in Capital Decision-
Making, GAO/AIMD-99-32 (Washington, D.C.: December 1998); OMB, Capital 
Programming Guide (Version 2.0) Supplement to OMB Circular A-11, part 
7: Planning, Budgeting, and Acquisition of Capital Assets (Washington, 
D.C., June 2006). 

[31] OMB’s revisions to Circular A-11 also attempt to address the 
government’s shortcomings in capital planning. 

[32] According to Smithsonian officials, this amount is undergoing 
additional review and may increase following the addition of more 
buildings to the equation. 

[33] The Smithsonian’s Capital Planning Board is made up of the chief 
financial officer (chairperson); deputy secretary and chief operating 
officer; under secretaries for Science and Art; chief executive officer 
of Business Ventures; chief information officer; general counsel; 
director of Policy and Analysis; and OFEO director. 

[34] The Smithsonian submits its 5-year capital plan to Congress as 
part of its annual budget justification. In recent work on capital 
planning, in 2007, we provided a matter for congressional consideration 
that Congress require agencies to develop comprehensive, long-term 
capital plans and submit them for congressional review in order to 
ensure that Congress is receiving the capital planning information it 
needs to make informed decisions. See GAO-07-274. 

[35] According to a Smithsonian official, at its June 2007 meeting, the 
board approved that the ad-hoc Committee on Facilities Revitalization 
become a standing committee. 

[36] While Congress does appropriate funds every year for the 
revitalization, maintenance and security of facilities, the Smithsonian 
could raise additional revenue or use existing unrestricted trust funds 
for these purposes. 

[37] 7Specifically, the President’s fiscal year 2008 budget proposal 
for the Smithsonian’s appropriation proposed $107,100,000 for 
facilities capital, which includes funding for facilities projects, and 
$571,347,000 for salaries and expenses, which includes facilities 
maintenance. 

[38] The Smithsonian’s general admission fee program estimate of $57.6 
million assumes about 7.8 million visitors and 540 new memberships. 
Visitor admission fees range from $3 to $10, and memberships are $16. 

[39] According to Smithsonian officials, the Cooper-Hewitt Museum was 
already charging admission fees when it joined the Smithsonian. In 
addition, it is located in New York City, where admission fees for 
museums are common. 

[40] In 1996 Congress established an experimental initiative called the 
Recreational Fee Demonstration Program, which was scheduled to expire 
on December 31, 2005. The program focused on the activities of four 
land management agencies: the National Park Service, Fish and Wildlife 
Service, Bureau of Land Management, and Department of Agriculture’s 
Forest Service. Under the fee demonstration program, the participating 
agencies were authorized to establish, charge, collect, and use fees at 
a number of sites to enhance visitor services and to address a backlog 
of needs for maintenance and repair, among other uses. New authority, 
the Federal Lands Recreation Enhancement Act, was enacted by Congress 
as part of the fiscal year 2005 Omnibus Appropriations Bill, and the 
program is authorized for 10 years. 

[41] The First Triennial Report to Congress Fiscal Year 2006 is the 
most recent report to Congress on the Recreational Fee Demonstration 
Program. The Recreational Fee Demonstration Program ended in December 
of 2004 and was replaced by the Federal Lands Recreation Enhancement 
Act. 

[42] APPA is an association for educational facilities professionals, 
formerly called the Association of Physical Plant Administrators. 

[43] Founded in 1955 as the American Society for Industrial Security 
(ASIS), the organization officially changed its named to ASIS 
International in 2002. ASIS International is a not-for-profit 
organization, disseminating information and educational materials to 
enhance security knowledge, practice, and performance. 

[44] OPS consulted with the Federal Emergency Management Agency (FEMA) 
on the methodologies and consultants to use for the 2005 all-hazards 
risk assessment report. For a methodology, FEMA recommended its Risk 
Management Series Publication 452. For consultants, FEMA recommended 
the entity used to create the FEMA 452 Publication. 

[45] The National Joint Terrorism Task Force (NJTTF) is an effort by 
the Federal Bureau of Investigation to coordinate the efforts of local 
joint-terrorism task forces in 100 cities nationwide. Local joint 
terrorism task forces include various local and state law enforcement 
entities and federal agencies, such as the Department of Homeland 
Security and the Central Intelligence Agency. NJTTF was created to 
enhance the FBI’s ability to promote coordinated terrorism 
investigations between its field offices and with its counterparts in 
federal, state, and local law enforcement agencies, and other federal 
agencies. 
 
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