Washington, D.C.—The following are opening remarks from Ranking Member of the House Committee on Transportation and Infrastructure Rick Larsen (D-WA) and Ranking Member of the Subcommittee on Economic Development, Public Buildings, and Emergency Management Greg Stanton (D-AZ) during today’s hearing titled, “America Builds: Making Federal Real Estate Work for the Taxpayer.”
Video of Larsen’s and Stanton’s opening statements are here and here.
More information on the hearing can be found here.
Ranking Member Larsen:
Chairman Ezell and Ranking Member Stanton, thank you for holding this timely hearing on the state of federal real estate.
Recent Administration actions to reduce both telework and the federal footprint have created confusion and upheaval within the federal real estate landscape. The proposed changes have the potential to have a negative impact on the federal workforce, communities, private sector landlords and construction contractors.
The General Services Administration (GSA) owns 1,500 buildings and has about 7,500 private-sector leases.
According to press reports, the Administration plans to reduce GSA’s owned and leased portfolio by 50 percent.
In justifying this push for property disposals, GSA’s new Public Buildings Commissioner has pointed to “guidance” from the WRDA 2024 bill.
But WRDA did not direct GSA to jump immediately to large-scale disposals. The WRDA bill directed GSA and OMB to work with agencies to measure building occupancy over a two-month period before making recommendations for space disposals. Congress gave GSA steps one through five, but GSA is skipping from step one directly to step five. That is causing confusion, chaos, in federal real estate.
The lease terminations are happening quickly and at the same time as return-to-office mandates, firings and RIFs.
But how can an agency know how much space they require if they don’t know how many employees they will have?
The only certainty we have is a certain lack of clarity.
The administration’s actions are reckless and potentially costly for taxpayers.
For example, last week the National Transportation Safety Board was notified that its lease was going to be terminated in four months. It is my understanding, although I don’t have any proof of that in writing, that the termination decision has now been reversed.
It is fortunate that the NTSB was not put in the position of having only four months to move offices and laboratory space while investigating 1,195 transportation accidents at the same time—including the recent midair collision near Reagan National Airport.
After consistently declining to provide my staff with information about building disposals, late yesterday, GSA shared a list of 400-plus “non-core assets being considered for divestment from government ownership.”
The list included the Bonneville Power Administration’s (BPA) HQ building in Portland.
Many utilities in Washington state and across the Pacific Northwest, including the largest public employer in my district, get large amounts of their power from BPA and hundreds of federal employees work in that building.
Selling the building would be very disruptive to BPA’s operations in the Pacific Northwest, especially as all employees have been ordered to return to work. I support that, but they need a place to go to.
BPA leases the building from GSA and pays for the lease with ratepayer money—not taxpayer money—I pay for the lease space at BPA because I pay rates through my public utility district, and I don’t think anyone else in this room does that. Selling this building would not lead to taxpayer savings from the BPA budget.
People are confused about GSA’s activities, and Congress has little visibility into what exactly GSA is doing. I don’t know if GSA knows what it is doing.
My own staff is largely getting news of GSA’s activities from the press, from a Reddit thread titled “GSA RIF Megathread” and occasionally from ex-GSA employees.
One building owner was told that GSA was terminating a lease, but because that lease was still in its firm term, GSA was obligated to pay for the space until 2029.
GSA actions have also led to confusion amongst the project managers, general contractors and engineers who are working on construction projects for GSA’s Public Buildings Service (PBS).
GSA recently rescinded the P-100 Facilities Standards which establish the design, architecture, engineering, fire protection, historic preservation and performance requirements for new buildings and major repair and alteration projects.
How does the rescission of the design standards impact construction and renovation projects? Do they need to be redesigned? Do contracts need to be redrafted? Delay and risk are challenging for contractors and expensive for the government, and therefore for taxpayers.
On January 24th GSA paused all acquisitions and lease activities including the National Deep Energy Retrofit program (NDER). According to one publicly traded energy company, “the current NDER pause may have detrimental impacts on projects currently in construction. We have spent substantial sums on project design, engineering, material procurement, and employee hiring. A prolonged pause of these projects will negatively impact business investment and chill business certainty.”
I, too, am disappointed that GSA’s new Commissioner of Public Buildings Mike Peters is not with us today. I have questions we are sending to him:
- If agency headcounts are in flux, how does GSA know how much space agencies need?
- Does GSA have the funding and the authority to pay expenses associated with closing offices, eliminating leases and relocating agencies to new space?
- As GSA cuts its budget and staff, who is going to do the labor-intensive work of terminating leases and relocating agencies? Is GSA going to hire contractors to replace federal employees?
So, Director Marroni and Mr. Winstead, I hope you can answer some of these questions. I don’t expect you to be able to answer all of these questions, but based on your experience, I hope we can get some insight on that. I look forward to your testimony and hope that you will be able to help answer some of my questions.
Thank you, Mr. Chairman. I yield back.
Ranking Member Stanton:
Mr. Chairman, thank you for holding this hearing.
Today we’re here to talk about the General Services Administration’s Public Buildings Service. GSA is the agency in charge of managing government buildings—essentially the federal government’s real estate agent.
Now, many of these public buildings may be underutilized—that is a sentiment that has been shared by both Republican and Democrat Administrations in the past. But rather than going through the proper channels to measure building utilization, the Trump Administration moved straight to the lease termination and building disposal stage, announcing plans to dispose of more than 400 buildings and terminate 2,500 leases—more than half of the GSA’s real estate portfolio.
To be clear, Congress—in a bipartisan way—agrees we need efficiency. In fact, the 2024 Water Resources Development Act, which was signed into law by President Biden in January, directed GSA, the Office of Management and Budget and federal agencies to measure building utilization over a two-month period and dispose of space if utilization was below 60 percent.
There is a logical way to do this. But the Trump Administration clearly has no intention of following the WRDA directive. Instead, there has been mass confusion.
Landlords are getting termination letters that their tenants know nothing about. Parties in the middle of lease negotiations don’t know what to do.
These space disposals are happening at the same time President Trump mandated a return to work for all federal employees. This is a policy at war with itself.
Federal employees are returning to offices that are being disposed of.
Landlords are getting termination notices for leases that are still in firm term.
Constituents are concerned that they will not have access to VA health centers and Social Security field offices.
All of this is happening, and GSA staff can’t or won’t communicate.
In fact, to get information, we’ve had to rely on word-of-mouth from federal employees and reports on the DOGE website, which lists hundreds of lease terminations—social security offices, VA offices and IRS offices—while we’re in the swing of tax season.
In my home state of Arizona, the list includes the Small Business Administration, the Bureau of Indian Affairs, the Railroad Retirement Board and the Forest Service supervisor’s office—the entity that processes permits and disseminates information for the entirety of Tonto National Forest northeast of my district, the largest national forest in the state.
The Forest Service building is an important hub for monitoring Tonto. If this building is shuttered, we do not know where this work will get done.
The loss of these buildings can have implications—with the loss of the supervisor’s office, I have concerns about what this could mean for communication and coordination of wildfire response in the National Forest.
As you can tell, I have a lot of questions about all of this.
A few weeks ago, I met with GSA’s new Commissioner of Public Buildings Mike Peters who is leading the Trump Administration’s federal real estate right-sizing efforts.
Commissioner Peters accepted an invitation to participate in this hearing, and then he changed his mind.
I don’t understand. We need to provide oversight of this process. Commissioner Peters has a responsibility to be here.
Instead of asking Commissioner Peters my questions, I will pose my questions to the two witnesses who are participating today: David Winstead from the Public Buildings Reform Board and David Marroni from the Government Accountability Office.
Mr. Marroni, thank you for once again testifying before this subcommittee and sharing your research and knowledge of federal real estate. I admire your fortitude.
Mr. Winstead, thank you for your service on the Public Buildings Reform Board. I look forward to hearing how the Board identifies underutilized federal assets and how the process of recommending disposals to GSA and OMB can be improved upon.
Thank you, Mr. Chairman, and I yield back the balance of my time.