GAO-19-57, Accessible Version, FEDERAL REAL PROPERTY
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United States Government Accountability Office Report to Congressional Requesters November 2018 FEDERAL REAL PROPERTY ASSET MANAGEMENT Agencies Could Benefit from Additional Information on Leading Practices Accessible Version GAO-19-57 November 2018 FEDERAL REAL PROPERTY ASSET MANAGEMENT Agencies Could Benefit from Additional Information on Leading Practices Highlights of GAO-19-57, a report to congressional requesters Why GAO Did This Study What GAO Found The federal government is the largest GAO identified six key characteristics of an effective asset management real property owner in the United framework (see table 1) that can help federal agencies manage their assets and States and spends billions of dollars to resources effectively. GAO identified these key characteristics through reviews of operate and maintain these assets, the International Organization for Standardization (ISO) 55000 standards—an which include buildings, roads, bridges, international consensus standard on asset management—studies and articles on and utility systems. Federal agencies asset management practices, and interviews with experts. GAO reviewed the are responsible for developing asset asset management practices of six federal agencies: the U.S. Coast Guard management policies, processes, and (Coast Guard); U.S. Army Corps of Engineers (Corps); General Services plans. In 2014, the ISO 55000 asset Administration (GSA); National Park Service (Park Service); National management standards were issued. Aeronautics and Space Administration (NASA); and U.S. Forest Service (Forest GAO was asked to examine federal Service). Each of the six federal-agency frameworks GAO reviewed included agencies’ real property asset some of the key characteristics. management practices and the applicability of ISO 55000. This report Table 1: Key Characteristics of an Asset Management Framework discusses: (1) key characteristics of an effective asset management Characteristic Description framework and how selected federal Establishing formal policies and Define a governance regime and identify staff agencies’ frameworks reflect these plans responsibilities. characteristics, and (2) whether government-wide asset management Maximizing an asset portfolio’s Develop a policy to identify the value of assets and to guidance and information reflect value derive the greatest value. standards and key characteristics of an Maintaining leadership support Articulate leadership support and provide necessary effective asset management resources. framework, among other objectives. Using quality data Collect, analyze, and verify accuracy of asset data. To conduct this work, GAO reviewed Promoting a collaborative Promote a culture of information sharing and the ISO 55000 standards, relevant organizational culture enterprise-wide decision making. studies and literature, and interviewed 22 experts and 10 practitioners. GAO Evaluating and improving asset Evaluate the performance of the asset management management practices system and implement necessary improvements. selected six federal agencies as case studies, including agencies with the Source: GAO analysis of ISO 55000 standards, asset management literature, and comments from experts. | GAO-19-57 largest real property portfolio and some agencies that were using the ISO While the Office of Management and Budget (OMB) has issued guidance to 55000 standards. GAO reviewed inform federal agencies’ real property management efforts, the existing guidance documentation and interviewed does not reflect an effective asset management framework because it does not officials from these six agencies, GSA, fully align with ISO 55000 standards and the key characteristics. For example, and OMB. this guidance does not direct agencies to develop a comprehensive approach to asset management that incorporates strategic planning, capital planning, and What GAO Recommends operations, or maintaining leadership support, promoting a collaborative OMB should take steps to improve organizational culture, or evaluating and improving asset management practices. information on asset management to In addition, the guidance does not reflect information on successful agency asset reflect leading practices. OMB had no management practices, information that officials from three of the six agencies comments on this recommendation. GAO spoke with said would be helpful to them. OMB staff said that they did not plan to update existing government-wide guidance because OMB’s real property management focus has shifted to the Reduce the Footprint initiative, which emphasizes efficiently managing and using buildings and warehouse space, View GAO-19-57. For more information, rather than all assets. Without a more comprehensive approach, as described contact Lori Rectanus at (202) 512-2834 or above, federal agencies may not have the knowledge needed to maximize the [email protected]. value of their limited resources. United States Government Accountability Office Contents Letter 1 Background 4 Effective Asset Management Frameworks Include Six Key Characteristics Reflected in Selected Agencies’ Practices 10 Experts and Practitioners Said Implementing an Asset Management Framework Can Be Challenging but Also Provides Benefits 24 Government-Wide Asset Management Information Does Not Fully Reflect an Effective Asset Management Framework 32 Conclusion 38 Recommendation 38 Agency Comments 39 Appendix I: Asset Management in Canada 40 Appendix II: Objectives, Scope, and Methodology 50 Appendix III: Key Elements of the International Organization for Standardization (ISO) 55000 Standards 58 Appendix IV: Comments from the Department of Agriculture 60 Appendix V: GAO Contact and Staff Acknowledgments 62 Appendix VI: Accessible Data 63 Data Table 63 Agency Comment Letter 63 Tables Table 1: Summary of the Fiscal Year 2017 Real Property Asset Portfolios of Six Selected Federal Agencies 13 Table 2: Examples of Strategies Experts and Practitioners Identified for Addressing Culture Change and Capacity Challenges to Implementing an Asset Management Framework 27 Table 3: Names and Affiliations of Experts Interviewed 51 Page i GAO-19-57 Federal Real Property Asset Management Table 4: Asset Management Organizations Interviewed 56 Table 5: GAO Summary of Key Elements of the International Organization for Standardization (ISO) 55000 Standards 58 Figures Figure 1: Example of an Asset Management Framework 5 Figure 2: Key Characteristics of an Asset Management Framework 11 Figure 3: Examples of Agency Assets 14 Figure 4: Temporary Steam Heating Pipe Running through Dockside Equipment, U.S. Coast Guard Yard, Curtis Bay, MD 19 Figure 5: U.S. Army Corps of Engineers, Brandon Road Lock and Dam, Joliet, IL 21 Figure 6: Damage to the Mountain Trunk Storm Sewer, City of Hamilton, Ontario, Canada 47 Figure 7: Flora Footbridge, Ottawa, Ontario Canada 49 Accessible Data for Figure 2: Key Characteristics of an Asset Management Framework 63 Page ii GAO-19-57 Federal Real Property Asset Management Abbreviations CFO Act Chief Financial Officers Act Coast Guard U.S. Coast Guard Corps U.S. Army Corps of Engineers FCM Federation of Canadian Municipalities FRPC Federal Real Property Council FRPP Federal Real Property Profile Forest Service U.S. Forest Service GSA General Services Administration ISO International Organization for Standardization NASA National Aeronautics and Space Administration OMB Office of Management and Budget Park Service National Park Service PAS 55 Publicly Available Specification 55 PG&E Pacific Gas & Electric Company PSPC Public Services and Procurement Canada This is a work of the U.S. government and is not subject to copyright protection in the United States. The published product may be reproduced and distributed in its entirety without further permission from GAO. However, because this work may contain copyrighted images or other material, permission from the copyright holder may be necessary if you wish to reproduce this material separately. Page iii GAO-19-57 Federal Real Property Asset Management 441 G St. N.W. Washington, DC 20548 Letter November 5, 2018 The Honorable Claire McCaskill Ranking Member Committee on Homeland Security and Governmental Affairs United States Senate The Honorable Thomas Carper United States Senate The federal government is the largest real property owner in the United States and spends billions of dollars annually to operate and maintain its real property portfolio. While the General Services Administration (GSA) provides real property asset management guidance and support to federal agencies—such as support to reduce their space requirements and to effectively manage their inventory and reduce costs—federal agencies are responsible for developing asset management policies, processes, and plans for their portfolios. Specifically, Executive Order 13327, issued in 2004, directed federal agencies to develop an asset management planning process and plan to promote the efficient and economical use of their real property assets.1 A number of standards and leading practices exist to guide organizations in developing an effective asset management framework,2 including the International Organization for Standardization (ISO) “ISO 55000” standards 3 which were published in 2014.4 The ISO 55000 standards are international consensus standards that describe leading practices for implementing, maintaining, and improving an effective asset management framework to manage all types of assets including real property assets. While some federal 1Exec. Order No. 13327, 69 Fed. Reg.