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Opening remarks, as prepared, of Economic Development, Public Buildings, and Emergency Management Subcommittee Member Kim King-Hinds (R-Northern Mariana Islands) from today’s hearing, entitled, “The General Services Administration: Examining the Future of Federal Real Estate Management to Reduce Costs for the Taxpayer”:

I’d like to thank our witness for being here today as we examine the management of federal real estate and how we can reduce costs to the taxpayer.

In December, this subcommittee held a hearing on federal real estate to discuss how we could minimize costs and maximize value for the American taxpayer. Since that hearing, GSA Administrator Ed Forst was confirmed by the Senate and sworn in. Today is an opportunity for the Subcommittee to hear from the Administrator on GSA’s plans and priorities for managing its real estate portfolio.

Last Congress, significant public buildings reforms were enacted as part of the Thomas R. Carper Water Resources Development Act of 2024 (WRDA 2024). Those reforms included new requirements and limitations on federal agencies when it comes to their use of space.  For example, the USE IT Act and the FULL Act included in WRDA 2024 are intended to hold agencies accountable for their space usage and set a requirement that if agencies do not actually have people physically coming in every day using at least 60 percent of their space, they will lose it. It also includes requirements that GSA and other federal agencies report to Congress and the public on the costs associated with unused space and that the Office of Management and Budget (OMB) submit to Congress a plan to consolidate headquarters buildings in the D.C. area. 

As expressed at the last hearing, we are extremely concerned that key deadlines have been missed. I understand OMB is a key player here – especially in ensuring all agencies, including those who have real estate authorities outside of GSA, are in compliance. But, without that data, critical time is being lost.

That is why on February 13th, Full Committee Chairman Sam Graves and Subcommittee Chairman Perry sent a letter to OMB and GSA requesting a briefing to update the Committee on compliance with the new requirements. Getting these bipartisan reforms across the finish line under the previous Administration was not easy, and they represent the most significant checks on federal real estate costs in decades.

The reforms also give you, as GSA Administrator, significant leverage over agencies that are resistant to letting go of unneeded space. That is why effective implementation of the reforms is so critical. 

With that said, we are pleased with some of the progress that GSA has made so far in consolidating agencies and getting rid of excess space, including moving HUD out of the Weaver Building, preparing to move USDA out of the Agriculture South Building, and DOE out of the Forrestal Building.

Decisions like these are going to help reduce the massive deferred maintenance liability that has accrued, which currently has a price tag that ranges anywhere from $26 billion to $340 billion, depending on which report you read.

I don’t think the American taxpayer or even federal agencies themselves understand how much of a financial liability federal real estate has become – there is no excuse for agencies to hold onto space just in case or hold onto a building because they’ve always been there.  With limited funding to properly maintain and operate federal buildings, the deferred maintenance has grown significantly – and that’s just to keep the lights on and doesn’t account for renovations needed to make them functional for the long-term. That is why GSA’s work on identifying core assets we may want to keep and non-core assets that should be disposed of is important.

Finally, there are other key topics I hope to hear more on, including the reorganization of the Public Building Service, as well as plans to divest from the Heating Operations and Transmission Division, which services steam and chilled water for 62 federal and D.C. buildings here in the core of the city.  

Click here for more information from today’s hearing, including video and witness testimony.