Federal Real Property:

GSA Outleasing and Restrictions on Participation of Elected Officials

GAO-18-603R: Published: Jul 25, 2018. Publicly Released: Jul 25, 2018.

Additional Materials:

Contact:

Lori Rectanus
(202) 512-2834
rectanusl@gao.gov

 

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

What GAO Found

The General Services Administration (GSA) is authorized under certain circumstances to lease unneeded space to private businesses and other nonfederal entities—a process known as outleasing. GSA outleases at least 20 percent of space in six federally-owned buildings, as of June 2018, ranging from part of the space in two buildings to all of the space in four other buildings. In April 2018, GSA finalized a new program guide that it anticipates will generally introduce a more standardized approach for its officials to follow in the agency’s outleasing. GSA officials told us that GSA contracting officers will continue to have discretion in developing terms and conditions of outlease agreements, subject to the general requirement that these contracting officers must act “in the best interests of the U.S. Government.”  Eight of the 11 leases for the six outleased buildings include one or more provisions restricting certain participation by members of Congress, and three of those same provisions also restrict certain participation by elected federal executive branch officials.

Why GAO Did This Study

GAO placed federal real property management on its High Risk List in 2003. Yet, 15 years later the federal government continues to face challenges in disposing of excess or underutilized real property that it is unable to repurpose. This report summarizes: (1) the extent to which GSA has used outleasing to substantially or wholly utilize unneeded federal real property; (2) the process GSA has followed when developing outlease agreements; and (3) the extent to which GSA has included provisions in its outlease agreements related to the participation of elected officials in these outleases. 
 
To address our objectives, we obtained GSA data, as of June 2018, on all federal real properties identified by GSA as substantially or wholly outleased—which we defined as outleasing 20 percent or more of a building. We validated these data by reviewing leases, interviewing GSA officials, and visiting one outlease site. We reviewed relevant laws and regulations, copies of the outlease agreements, and older leases on which the current leases were modeled. We also reviewed GSA’s Outlease Program Guide, finalized in April 2018. We interviewed officials from GSA’s Outlease Program Office, GSA’s Office of General Counsel, and GSA regional offices, including those involved with or knowledgeable about the outlease agreements included in our review.

For more information, contact Lori Rectanus at 202-512-2834 or rectanusl@gao.gov.

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