AGA Survey Cites Lack of Incentives as Real Property Stumbling Block

Lack of Incentives was one of the leading problems in effective federal real property asset management, according to a survey by the Association of Government Accountants (AGA).

AGA (www.agacgfm.org) co-sponsored the Federal Real Property Asset Management survey with American Appraisal Associates. Preliminary findings of the survey – which will be finalized later this year – were presented at the AGA’s 55th Annual Professional Development Conference and Exposition, held in San Diego, CA from June 18-21 of this year.

In conducting the survey, researchers contacted 21 Federal agencies and administrations, of which 14 completed the polling. As points of comparison to federal asset management state governments and commercial businesses and property managers also were contacted. Six state governments participated in the study, as did five corporate participants.

In addition to a lack of incentives as an obstacle to real property asset management, federal respondents noted that “no one will identify excess or surplus property unless forced to do so – identification of surplus property can become very political.”

Respondents were also asked to identify federal real property asset management high-risk areas. The addressing of significant real property repair and restoration needs was deemed applicable as high-risk by 50 percent of respondents; 36 percent ranked it partially applicable. Development of reliable and useful real property data was judged applicable by 79 percent of respondents.

Realignment and rationalization of real property and disposition of unneeded assets was evenly split, with 43 percent of respondents considering these topics applicable or partially applicable as high-risk areas.

When asked to provide their highest priority changes for the next 12 to 18 months, federal respondents listed:

• Receiving approval of agency’s Real Property Asset Management Plan from OMB
• Categorizing data into designated 23 data elements and establishing an asset management data base
• Implementing an automated real property asset management system

Respondents additionally noted the following as priority changes:

• Establishing a uniform automated and integrated portfolio management system based on the convergence of the separate real estate data systems in place
• Preparing an inventory and condition assessment of the real estate holdings
• Disposal of selected state buildings with high deferred maintenance
• Development of a capital budget using a Facility Condition Index and capital planning module of the new facilities assessment software program
• Apply an owned versus leased analysis to future office space decisions

When asked to suggest real property legislative and regulatory changes to make real property asset management more workable, respondents recommended legislative authority to retain proceeds from leases of land and sale of land or structures. They also suggested changing the Property Act to allow for out-leasing and disposal of Federal facilities, retaining the proceeds for constructing new modern facilities or for deferred maintenance.

Survey participants also urged streamlining of the process for transferring title to GSA or other agencies – the current process is too cumbersome, they noted.