‘Sitting on Our Assets’ 

Sitting on Our Assets” is the humorous title of a depressing report by the House Committee on Transportation and Infrastructure chaired by Rep. John Mica, R-Fla., that catalogues the enormous waste that inevitably occurs when federal bureaucrats attempt to manage assets under their control. Consider it a primer on how to flush billions of dollars down the drain without even trying.

For instance, the General Services Administration (GSA) finally got around to selling a 10-story office building in downtown Bethesda that’s been vacant for eight years when the real estate market was in the tank, forcing it to accept less than the minimum suggested bid for the property – even though it’s located just eight miles from downtown D.C. and comes with high-density zoning exemptions.

To make matters worse, GSA officials are now trying to lease a similarly-sized office building in Bethesda for an agency whose lease expires next year. Certain GSA employees clearly have no idea what their counterparts are doing.

Other underutilized properties include the only partially occupied Old Post Office Building in D.C., which loses $6.5 million a year. In 2005, GSA determined that simply leasing the building to private developers would yield a $21 million profit, but of course the agency has taken no steps during the last five years to make the switch. When other people’s money is at stake, what’s the rush?

Here’s another example right here in D.C: Ten years ago, the Government Accountability Office predicted that space would be needed for 49 federal judges at the E. Barrett Prettyman Courthouse and Bryant Annex. There are now 10 less judges hearing cases there than projected, and two less than when the annex was proposed – leaving 12 empty chambers. GAO has admitted that it overbuilt the facility, costing taxpayers $56 million for unneeded construction and $4 million more for annual maintenance and operations.

Under a bizarre deal, the new Department of Transportation headquarters, also located in D.C., was “built on federal land, transferred to the developer, who in turn constructed the building leased back to the U.S. government with no right of ownership…the taxpayer will pay for this structure several times over without any ownership interest in the building,” according to the report. Who signs off on these “deals”?

And bumbling bureaucrats at the Federal Trade Commission are currently planning to lease “consolidated” space that will not actually consolidate FTC activities, but will cost the government $300 million more than constructing or purchasing a new headquarters building that puts all the agency’s functionaries under one roof.

Multiply this ineptitude by the 896,000 buildings and more than 41 million acres of land owned by the federal government, and the dimensions of the problem become apparent. In fact, Mica says, improved management within GSA, Amtrak, the Federal Emergency Management Agency and other agencies could potentially save taxpayers $250 billion. That’s more than the entire cost of the Louisiana Purchase adjusted for inflation.

But that would require some intelligent planning and, as we have seen, government bureaucrats prefer to sit on our assets instead.

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