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Cuts in federal building costs under review

By Ed O'Keefe

Eye Opener

President Obama wants to trim $3 billion in federal building costs in the next two years, but early signs suggest mixed success at selling off extra office buildings, courthouses, embassies and storage sheds.

The orders could eventually result in thousands of renegotiated or canceled leases and the divestment of other notable government-owned properties.

The federal government owns about 1.2 million facilities with an annual operating and maintenance budget of $19 billion, according to the Office of Management and Budget. An inventory completed during George W. Bush's administration identified about 14,000 vacant buildings and another 55,000 underused locations.

Administration officials initially unveiled the cuts as an $8 billion package, but only $3 billion of the cuts are new, mostly from the departments of Energy, Homeland Security and Transportation, officials said. The other $5 billion is part of the Defense Department Base Closure and Realignment Commission process.

Agencies submitted proposed cuts last month and OMB said this week they are more than halfway to the goal. Here are some early examples:

-- The Navy is selling Naval Air Station Treasure Island -- used for civilian purposes since 1993 -- to the city of San Francisco for $55 million. The government may receive another $50 million if private investors redeveloping the island achieve a certain level of return, OMB said. Official transfer of the island and payments won't occur until environmental reviews are completed, a process that can take several years.

-- Private developers in August purchased a General Services Administration building in Bethesda for $12.3 million. The building once housed offices of the National Institutes of Health and sold for almost $2 million less than the original asking price.

-- A federal office building in Springfield, Mass. sold for $2,4 million. The city moved its school headquarters into the building and Baystate Health will move in later this year.

-- The government has also sold a federal building in Omaha for $1.2 million and a building and courthouse in Rockford, Ill. for $1.2 million.

Agencies are also planning to consolidate about 2,000 government data centers that account for much of the government's building costs and environmental footprint. Early government estimates suggested agencies operated a combined 1,100 data centers, but an inventory published last month discovered another 900 locations. OMB said it will unveil plans to consolidate the data centers next month.

Capital Business staff writer Jonathan O'Connell contributed to this report.

Leave your thoughts in the comments section below

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By Ed O'Keefe  | October 27, 2010; 7:20 AM ET
Categories:  Budget, Eye Opener  
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Posted by: jiajia1333 | October 27, 2010 9:21 AM | Report abuse

Until this Spring I worked in the Federal Center area. For years, a former FDA building at 3rd and C, SW, has remained vacant and forlorn. Occasionally some work seemed underway (toxic remediation?), but basically it was a ghost building occupying a full city block just a few minutes' walk from the Capitol.

Posted by: ArtCee | October 27, 2010 10:05 AM | Report abuse

We could save money at EPA by turning the lights off after hours.

Posted by: anarcho-liberal-tarian | October 27, 2010 10:41 AM | Report abuse

There is a lot of room for efficiency improvements in federal space Ed, but its not just getting rid of underutilized buildings. What DoD found in the BRAC process is that it is neither cheap, nor easy, to close facilities. And the hard work is not just on GSA, rather its the departments and agencies who need to embrace a new approach to workspace. I'll put in a plug for telework (as you would expect), but a more important issue is space sharing. There is no reason federal workers can't work at any federal location (esp. if it shortens their commute). We need to look at a multi-tenant approach at all facilities, not just federal office buildings. This is a strategy which will pay real dividends in lower rent costs, energy savings, and improvements in quality of life and recruitment/retention of key employees.

Posted by: jsawislak | October 27, 2010 12:55 PM | Report abuse

Do as EPA says, not as EPA does, traitor.

Posted by: getjiggly1 | October 27, 2010 1:36 PM | Report abuse

How about cutting janitorial services in office spaces? People used to vacuum their own spaces and take out their own trash. This is a simple thing that can be done and cut janitorial services in ALL govt building, except public types such as museums, etc (including leased buildings which costs about $.55 per sq ft)thus saving MILLIONS. This should also hold true for Capitol Hill.

Posted by: IGotLotsToSay | October 28, 2010 5:08 AM | Report abuse

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