Federal Real Property: GSA Should Fully Assess Its Prospectus Process and Communicate Results to Its Authorizing Committees
Fast Facts
The General Services Administration (GSA) spends billions of dollars annually to maintain federal buildings and lease office space. For major leases and repairs, GSA seeks approval from Congress through its "prospectus process."
GSA identified challenges with this process, such as months-long review times and limited funding, that make it difficult to complete needed maintenance and repairs. However, GSA has neither fully assessed the process nor expressed its concerns and ideas for potential changes to Congress.
We recommended that GSA assess the effectiveness of the prospectus process and inform Congress about its findings.
This federal building in Akron, Ohio, awaits major water damage repairs.
Highlights
What GAO Found
The Public Buildings Act of 1959, as amended, requires the General Services Administration (GSA) to submit a proposal (prospectus) for capital and lease projects with an estimated cost that exceeds a certain dollar threshold to two congressional-authorizing committees. Per GSA guidance, GSA's 11 regional offices develop prospectuses that describe the projects. GSA's Central Office and the Office of Management and Budget each review the prospectuses before GSA submits them to the authorizing committees. GSA obtains these committees' approvals before obligating appropriated funds for the project.
Steps and Time Frames for the Development and Approval of the General Services Administration's (GSA) Prospectuses, Fiscal Years 2014–2020
In general, for fiscal years 2014 through 2020, GSA averaged 1 year to submit lease prospectuses and 9 months to submit capital project prospectuses to the authorizing committees. The committees averaged 8 months to approve leases and 14 months to approve capital projects. However, the time frames vary and can be affected by the appropriations process. GSA waits for the President's budget to be transmitted to Congress before submitting capital project prospectuses to the committees. In 4 of the 7 fiscal years that GAO reviewed, the budget was submitted after February. In addition, the committees' approvals typically occurred after annual appropriations were enacted.
GSA has taken steps to assess some aspects of the prospectus process. For example, GSA assessed its leasing process and found it needed to submit prospectuses to the committees earlier to reduce extensions on existing leases while awaiting committees' approvals. However, GSA has not completed a full assessment of the prospectus process, including the process for capital projects. GSA officials stated that challenges related to the prospectus threshold, delayed approvals, and limited funding contribute to difficulties GSA faces in managing its portfolio (e.g., addressing repair and maintenance backlogs). While GSA has identified potential changes that would require legislative action, it has not communicated its concerns or potential changes to the authorizing committees. By fully assessing the prospectus process and communicating with the authorizing committees, GSA can work with the committees to address any risks posed by the process, while also ensuring that any changes do not impede the committees' oversight activities.
Why GAO Did This Study
Each year, GSA spends hundreds of millions of dollars in funding to construct, repair, and alter buildings in its portfolio and another $5.7 billion in rent for over 8,000 leases of privately owned space. GSA's prospectus process can pose challenges to its ability to effectively manage its assets.
GAO was asked to review GSA's prospectus process. This report: (1) describes GSA's process for developing and obtaining approval of prospectuses; (2) determines average time frames for prospectuses' reviews and approvals; and (3) examines the extent to which GSA has assessed the prospectus process to identify and address challenges, if any, that may affect GSA's management of federal assets. GAO reviewed, among other things, relevant statutes and regulations and GSA documents; analyzed data for prospectuses submitted for funding for fiscal years 2014 through 2020; and interviewed GSA and OMB officials.
Recommendations
GAO recommends: (1) that GSA fully assess the prospectus process for leases and capital projects—including identifying, analyzing, and responding to risks associated with the process—and implement potential improvements to the process, and (2) that GSA communicate to its authorizing committees the results of its assessment, including any proposed changes that may require legislative action to implement. GSA agreed with the recommendations and stated that it is developing a plan to address them.
Recommendations for Executive Action
| Agency Affected | Recommendation | Status |
|---|---|---|
| General Services Administration |
Priority Rec.
The Commissioner of the Public Buildings Service should fully assess the prospectus process for leases and capital projects—including identifying, analyzing, and responding to risks associated with the process that may limit GSA's ability to manage its assets portfolio—and should implement potential improvements to the process identified through the assessment. As part of this assessment, the Commissioner should solicit input from GSA's authorizing committees about challenges and risks posed by the prospectus process. (Recommendation 1) |
Closed – Implemented
In addition to exercising control over the activities of GSA through the annual appropriations process, Congress also oversees GSA's activities and the obligation of funds through the prospectus process. GSA must submit a prospectus to its congressional-authorizing committees-the House Committee on Transportation and Infrastructure and the Senate Committee on Environment and Public Works-for GSA's capital and lease projects with an estimated cost above a certain dollar threshold. The prospectus provides high-level information on the proposed projects and GSA obtains approval of the prospectus from its authorizing committees before it obligates appropriated funds for a project. In 2022, GAO reported that GSA officials identified challenges related to the prospectus threshold, delayed approvals, and limited funding that contribute to difficulties GSA faces in managing its portfolio of assets, such as addressing the repair backlog at its buildings. While GSA had taken some steps to assess and make targeted changes to its prospectus process for leases, the agency had not fully assessed the lease or capital-prospectus process to identify, analyze, and respond to any risks presented by the process. Nor had GSA proactively engaged with its authorizing committees to address GSA's concerns or seek their input. With respect to leases, GSA assessed aspects of its leasing process to reduce lease costs. However, GSA officials did not provide us with any evidence to show that they had assessed the entire prospectus development, review, and approval process for lease and capital projects. The officials also said that the authorizing committees had not raised any concerns about the overall process to GSA. Standards for Internal Control in the Federal Government calls for agencies to identify, analyze, and respond to risks to help achieve their defined objectives. Similarly, our prior work has demonstrated that effective risk management involves, among other things, comprehensively identifying risks, assessing the likelihood and impact of risks, and determining the appropriate response. Without a full assessment of the prospectus development, review, and approval process, GSA may not identify potential improvements to the process that could help GSA address the risks posed by the current process to GSA's ability to effectively manage its portfolio of assets. Thus, GAO recommended that the Commissioner of the Public Buildings Service fully assess the prospectus process for leases and capital projects-including identifying, analyzing, and responding to risks associated with the process that may limit GSA's ability to manage its assets portfolio-and implement potential improvements to the process identified through the assessment. As part of this assessment, the Commissioner should solicit input from GSA's authorizing committees about challenges and risks posed by the prospectus process. In 2023, GAO confirmed that GSA had assessed the prospectus process and solicited input from its authorizing committees. Specifically, GSA provided GAO with the results of an internal assessment of the prospectus process, which included sections identifying, analyzing, and proposing ways to respond to risks associated with the process. GSA informed its authorizing committees of the results of GSA's initial internal assessment of the prospectus process and proposed changes to the process that require the support of the committees. GSA also solicited input from the authorizing committees regarding ways to improve the prospectus process as well as the information and support the agency provides the committees. By taking these steps, GSA has identified improvements to the process while ensuring that it does not pursue actions that impede on the committees' oversight activities.
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| General Services Administration |
Priority Rec.
The Administrator of the General Services Administration should communicate to the agency's authorizing committees the results of GSA's assessment, including any proposed changes to the process that may require legislative action to implement. (Recommendation 2) |
Closed – Implemented
In addition to exercising control over the activities of GSA through the annual appropriations process, Congress also oversees GSA's activities and the obligation of funds through the prospectus process. GSA must submit a prospectus to its congressional-authorizing committees-the House Committee on Transportation and Infrastructure and the Senate Committee on Environment and Public Works-for GSA's capital and lease projects with an estimated cost above a certain dollar threshold. The prospectus provides high-level information on the proposed projects and GSA obtains approval of the prospectus from its authorizing committees before it obligates appropriated funds for a project. In 2022, GAO reported that GSA had not communicated its concerns and suggestions to its authorizing committees or solicited their feedback on the prospectus process. GSA officials identified two specific suggestions that they believed would address their concerns and improve the prospectus process and noted these actions may require support from the authorizing committees and legislative changes. However, GSA officials said that GSA had not communicated these suggestions to the authorizing committees or solicited their feedback on the process. GSA also had not proactively communicated to its authorizing committees any of its concerns related to the prospectus process or potential changes that it believed could help improve the process. GSA officials told GAO that they had drafted legislative proposals that provide insight on the challenges posed by the prospectus requirements and the resulting implications to GSA's effective management of its assets. However, officials explained that they did not submit these legislative proposals to OMB or to GSA's authorizing committees because, as a matter of practice, GSA generally did not submit proposals seeking changes to statutory requirements without a request to do so from the authorizing committees. GAO's prior risk management work has shown that sharing information about risks and incorporating feedback from stakeholders can help organizations better manage risks, as well as increase transparency and accountability to Congress. In addition, Standards for Internal Control in the Federal Government call for agencies to externally communicate the necessary quality information to achieve their defined objectives. By not effectively communicating its concerns and potential improvements, GSA was missing an opportunity to engage in discussions on how the process might be improved. Thus, GAO recommended that the Administrator of the General Services Administration communicate to the agency's authorizing committees the results of GSA's assessment of the prospectus process, including any proposed changes to the process that may require legislative action to implement. In 2023, GAO confirmed that GSA had assessed the prospectus process and communicated the results with its authorizing committees. Specifically, GSA provided GAO with the results of an internal assessment of the prospectus process, which included sections identifying, analyzing, and proposing ways to respond to risks associated with the process. GSA informed its authorizing committees of the results of GSA's initial internal assessment of the prospectus process and proposed changes to the process that require the support of the committees. GSA also solicited input from the authorizing committees regarding ways to improve the prospectus process as well as the information and support the agency provides the committees. By communicating challenges identified in the prospectus process to the authorizing committees and soliciting their feedback, GSA is better positioned to ensure that it is addressing any risks posed by the process.
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