    [House Hearing, 112 Congress]
    [From the U.S. Government Publishing Office]

                       CUTTING SPENDING AND CONSOLIDATING
                      FEDERAL OFFICE SPACE: GSA'S CAPITAL
                         INVESTMENT AND LEASING PROGRAM

    =======================================================================

                                    (112-14)

                                    HEARING

                                   BEFORE THE

                                SUBCOMMITTEE ON
        ECONOMIC DEVELOPMENT, PUBLIC BUILDINGS, AND EMERGENCY MANAGEMENT

                                     OF THE

                                  COMMITTEE ON
                       TRANSPORTATION AND INFRASTRUCTURE
                            HOUSE OF REPRESENTATIVES

                          ONE HUNDRED TWELFTH CONGRESS

                                 FIRST SESSION

                                   __________

                                 MARCH 10, 2011

                                   __________

                           Printed for the use of the
                 Committee on Transportation and Infrastructure

                   Available online at: http://www.fdsys.gov/

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                 COMMITTEE ON TRANSPORTATION AND INFRASTRUCTURE

                        JOHN L. MICA, Florida, Chairman

    DON YOUNG, Alaska                    NICK J. RAHALL II, West Virginia
    THOMAS E. PETRI, Wisconsin           PETER A. DeFAZIO, Oregon
    HOWARD COBLE, North Carolina         JERRY F. COSTELLO, Illinois
    JOHN J. DUNCAN, Jr., Tennessee       ELEANOR HOLMES NORTON, District of
    FRANK A. LoBIONDO, New Jersey        Columbia
    GARY G. MILLER, California           JERROLD NADLER, New York
    TIMOTHY V. JOHNSON, Illinois         CORRINE BROWN, Florida
    SAM GRAVES, Missouri                 BOB FILNER, California
    BILL SHUSTER, Pennsylvania           EDDIE BERNICE JOHNSON, Texas
    SHELLEY MOORE CAPITO, West Virginia  ELIJAH E. CUMMINGS, Maryland
    JEAN SCHMIDT, Ohio                   LEONARD L. BOSWELL, Iowa
    CANDICE S. MILLER, Michigan          TIM HOLDEN, Pennsylvania
    DUNCAN HUNTER, California            RICK LARSEN, Washington
    TOM REED, New York                   MICHAEL E. CAPUANO, Massachusetts
    ANDY HARRIS, Maryland                TIMOTHY H. BISHOP, New York
    ERIC A. ``RICK'' CRAWFORD, Arkansas  MICHAEL H. MICHAUD, Maine
    JAIME HERRERA BEUTLER, Washington    RUSS CARNAHAN, Missouri
    FRANK C. GUINTA, New Hampshire       GRACE F. NAPOLITANO, California
    RANDY HULTGREN, Illinois             DANIEL LIPINSKI, Illinois
    LOU BARLETTA, Pennsylvania           MAZIE K. HIRONO, Hawaii
    CHIP CRAVAACK, Minnesota             JASON ALTMIRE, Pennsylvania
    BLAKE FARENTHOLD, Texas              TIMOTHY J. WALZ, Minnesota
    LARRY BUCSHON, Indiana               HEATH SHULER, North Carolina
    BILLY LONG, Missouri                 STEVE COHEN, Tennessee
    BOB GIBBS, Ohio                      LAURA RICHARDSON, California
    PATRICK MEEHAN, Pennsylvania         ALBIO SIRES, New Jersey
    RICHARD L. HANNA, New York           DONNA F. EDWARDS, Maryland
    STEPHEN LEE FINCHER, Tennessee
    JEFFREY M. LANDRY, Louisiana
    STEVE SOUTHERLAND II, Florida
    JEFF DENHAM, California
    JAMES LANKFORD, Oklahoma

                                      (ii)

    ?

     Subcommittee on Economic Development, Public Buildings, and Emergency
                                   Management

                       JEFF DENHAM, California, Chairman

    TIMOTHY V. JOHNSON, Illinois         ELEANOR HOLMES NORTON, District of
    ERIC A. ``RICK'' CRAWFORD,           Columbia
    Arkansas,                            HEATH SHULER, North Carolina
      Vice Chair                         MICHAEL H. MICHAUD, Maine
    RANDY HULTGREN, Illinois             RUSS CARNAHAN, Missouri
    LOU BARLETTA, Pennsylvania           TIMOTHY J. WALZ, Minnesota
    BOB GIBBS, Ohio                      DONNA F. EDWARDS, Maryland
    PATRICK MEEHAN, Pennsylvania         BOB FILNER, California
    RICHARD L. HANNA, New York           NICK J. RAHALL II, West Virginia
    STEPHEN LEE FINCHER, Tennessee         (Ex Officio)
    JOHN L. MICA, Florida (Ex Officio)

                                     (iii)

                                    CONTENTS

                                                                       Page

    Summary of Subject Matter........................................    vi

                                   TESTIMONY

    Peck, Robert, Commissioner, Public Buildings Service, U.S.
      General Services Administration................................     2

              PREPARED STATEMENTS SUBMITTED BY MEMBERS OF CONGRESS

    Norton, Hon. Eleanor Holmes, of the District of Columbia.........    29

                   PREPARED STATEMENTS SUBMITTED BY WITNESSES

    Peck, Robert.....................................................    32
    [GRAPHIC] [TIFF OMITTED] T5449.001

    [GRAPHIC] [TIFF OMITTED] T5449.002

    [GRAPHIC] [TIFF OMITTED] T5449.003

    [GRAPHIC] [TIFF OMITTED] T5449.004

                              CUTTING SPENDING AND
                      CONSOLIDATING FEDERAL OFFICE SPACE:
                          GSA'S CAPITAL INVESTMENT AND
                                LEASING PROGRAM

                                  ----------

                            Thursday, March 10, 2011

                      House of Representatives,
           Subcommittee on Economic Development, Public
                    Buildings and Emergency Management,
                Committee on Transportation and Infrastructure,
                                                        Washington, DC.
        The subcommittee met, pursuant to notice, at 10:16 a.m. in
    room 2167, Rayburn House Office Building, Hon. Jeff Denham
    [chairman of the subcommittee] presiding.
        Mr. Denham. This subcommittee will come to order. Ranking
    Member Norton will be detained for a short period of time. She
    is at a different hearing right now, testifying. So we are
    going to go ahead and get started this morning.
        This hearing is focused on the General Services
    Administration's capital investment and leasing program, and
    examining ways to cut spending and consolidate Federal office
    space. Today we are reviewing the 2012 program and the
    remaining lease prospectuses from the 2011 program.
        Given the financial crisis facing our country, we simply
    must reduce the amount of money we spend to house Federal
    employees. Excess and under-utilized properties must be
    eliminated. The price we pay for space has to be controlled.
    And agencies will have to house more people in less space. The
    committee intends to scrutinize each project from this
    perspective, in order to determine if they will save taxpayer
    money.
        We received the President's proposal, 2012 budget proposal,
    nearly a month ago. That budget proposes to spend $840 million
    on construction and acquisition projects, and $869 million on
    repairs and alteration projects. The budget includes funding
    for specific projects, including ports of entry, FBI
    consolidations, and the repair and alteration of other Federal
    buildings.
        Our committee just received GSA's fiscal year 2012 capital
    improvement program yesterday, nearly a month after the release
    of the President's budget. Year after year, this subcommittee
    has requested GSA provide its capital investment program early
    in the year, so that we can act in a timely fashion. I do
    appreciate that we did receive the program prior to this
    hearing, and hope we can work with GSA on ensuring timely
    submission in the future.
        I also want to thank Mr. Peck for his response to the
    letter signed by all the Members of this Committee last week,
    requesting access and information from the Federal real
    property profile database regarding GSA properties. I do remain
    concerned, however, that some of the requests remain
    outstanding. For example, in January GSA briefed subcommittee
    staff on the lease prospectuses still pending from the 2011
    leasing program, and staff requested information on many of
    those projects. Responses to those requests were only received
    yesterday.
        In addition, at the hearing we had last month, members of
    the subcommittee asked for information to be submitted. Many of
    those deadlines are today, including: the Old Post Office
    Building, an explanation to the subcommittee why the RFP has
    not been released; a list of properties losing money on an
    annual basis in the national capital region--we did have the
    operating costs in there, but without the revenues associated
    with that, it does not allow us the opportunity to see whether
    or not we are losing money; recommendations on any changes
    needed to existing law to streamline the property disposal
    process.
        We will be coming out with our own recommendations in bill
    form. So we would certainly like to work with GSA on their
    recommendations in that process.
        I hope we are going to receive the responses to those
    questions very soon. This committee does not plan to approve
    leases until we receive this information. I want to make sure
    GSA is very well aware of that.
        The administration's goal of addressing the problem of
    unneeded and underutilized assets is one that is shared by this
    subcommittee. It is critical that we have access to relevant
    information in a timely fashion, so that we can effectively
    work with GSA and the administration on proposals to stop waste
    when it comes to our public buildings and facilities. I look
    forward to working with Mr. Peck on these issues.
        And I would just like to add for the record we had a great
    meeting yesterday over at your office. I appreciate the
    opportunity not only to get together, but some frank
    conversation on how we can greatly improve the process and work
    together.
        Ms. Norton will be here shortly, and I will still allow her
    an opening testimony.
        But for now, I would like to call on Mr. Peck for an
    opening statement.

       TESTIMONY OF ROBERT PECK, COMMISSIONER, PUBLIC BUILDINGS
         SERVICE, UNITED STATES GENERAL SERVICES ADMINISTRATION

        Mr. Peck. Well, thank you. And thank you, Mr. Chairman, for
    coming over to the office yesterday. I also thought we had a
    very productive conversation.
        Chairman Denham, Congressman Crawford, and members of the
    subcommittee, thank you for inviting me here today to discuss
    the investments that GSA is making in our Nation's
    infrastructure through our fiscal year 2012 capital investment
    program. The projects in our fiscal year 2012 program are
    critical investment needs for our country and tenant agencies.
        PBS is investing in our Nation's economic recovery while
    meeting our sustainability responsibilities. These investments
    stimulate job growth, increase space utilization, enhance asset
    condition, and improve the environmental performance of our
    inventory.
        GSA utilizes a detailed asset analysis strategy to drive
    investment decisions. This plan prioritizes agency requirements
    and asset needs based on criteria, including agency mission,
    facility conditions, space utilization, return on investment,
    and sustainability.
        PBS continues to demonstrate strong operational
    performance, surpassing many private-sector benchmarks to
    improve asset utilization and achieve the greatest return to
    taxpayers. Eighty-three percent of GSA's government-owned
    assets achieve a positive cash flow. Our vacancy rate, just
    under 3 percent, is well below the private-sector rate of about
    17 percent.
        PBS is also becoming a green proving ground through
    judicious investment in new and innovative technologies. GSA is
    the steward of more than 1,500 government-owned buildings,
    which have a replacement value of $45 billion. PBS is
    requesting a repair and alterations program of $869 million to
    enable GSA to maintain and improve these properties, so that
    they can continue to meet the needs of our tenant agencies.
        Industry benchmarks suggest investing at least two percent
    of replacement value annually in capital upgrades, and our
    request is at about 1.9 percent. This program includes
    completing multi-phase renovations at the Interior and State
    Department headquarters in Washington, and at the Prince Jonah
    Kuhio Kalanianaole Building in Honolulu. I just say that
    because I'm proud that I know how to pronounce it.
        [Laughter.]
        Mr. Peck. It also includes major consolidations that will
    permit us to relocate tenants from lease space into federally
    owned space in San Francisco and in Overland, Missouri.
        PBS is requesting $840 million, as you noted, for our new
    construction program. PBS's fiscal year 2012 priorities reflect
    urgent tenant mission needs, and investments that will ensure a
    long-term payback for taxpayers. Highlights of the program
    include: $217 million for the Department of Homeland Security
    consolidation at St. Elizabeths in Washington; $243 million for
    FBI projects in San Juan, Puerto Rico and Frederick County,
    Virginia; and $371 million for land port of entry construction
    in New Mexico, Texas, New York, and North Dakota.
        In addition to GSA's budget request, the Department of
    Transportation has requested $2.2 billion in service
    transportation investments which will be transferred to GSA for
    the design and construction of a number of critical facilities
    at our Nation's borders. These investments prioritize the
    largest border crossings that support high-volume
    transportation and cross-border trade.
        You have a right to ask if we can deliver on these
    projects. In our hundreds of accelerated projects under the
    American Recovery and Reinvestment Act passed just two years
    ago, we met every contracting deadline, and are also on our
    construction targets. We have created some 16,000 jobs to date.
        GSA's fiscal year 2012 request assumes full funding of the
    President's fiscal year 2011 budget for GSA's capital program.
    If, in the end, we do not receive funding for the fiscal year
    2011 capital program, GSA may need to alter our fiscal year
    2012 request. If any revisions to the fiscal year 2012 budget
    request are necessary, we will notify the committee
    accordingly.
        We do want to thank the committee and subcommittee for
    authorizing our fiscal year 2011 capital program in a timely
    way last year.
        We urge you also to authorize the balance of our fiscal
    year 2011 prospectus level leasing program. More than half the
    workforce we accommodate is in space leased from private-sector
    building owners. As you know, we prefer to provide space in
    federally owned assets whenever possible. But when we do not
    have such space, we lease in the private market. We will submit
    prospectus-level leases for the fiscal year 2012 program to the
    committee this summer for authorization.
        I need to alert you to an urgent concern. Proposed
    continuing resolution cuts to the Federal building funds
    operations and leasing accounts for the remainder of the fiscal
    year would seriously inhibit our ability to provide basic
    building services, and even to remain current on lease payments
    to our lessors.
        We all want to minimize the size of the Federal inventory.
    The President announced in his fiscal year 2012 budget a
    legislative initiative to accelerate the identification and
    disposal of surplus properties. This is a follow-on to his
    memorandum to Federal agencies in June of 2010 ordering
    stepped-up efforts to identify excess property. That is a
    government-wide effort that we have been leading, since we are
    the Federal Government's central agency for disposing of
    surplus property.
        The administration is proposing a civilian property
    realignment initiative that will enable us to improve how we
    identify and move surplus properties out of the Federal
    inventory, allowing us to realize a financial return, and
    perhaps as important, eliminate the cost of maintaining these
    properties. An appointed board would review all Federal agency
    properties and provide a mechanism to overcome some current
    impediments to moving surplus space out of the inventory. And I
    thank you for your passion and commitment for helping move
    surplus property out, as well.
        More than a year ago we stepped up our consulting with
    Federal agencies on ways to embrace new mobile workplace
    technologies and office strategies that should permit dramatic
    reductions in the amount of space agencies need to carry out
    their missions. We are using the renovations of our
    headquarters building currently underway as an example. We
    expect nearly to triple the number of people that that building
    accommodates.
        The program we present today reflects an analytic and best-
    practice-based approach to meeting Federal agency real estate
    needs, while at the same time we improve operational
    efficiencies and space utilization to minimize costs for the
    American taxpayer. We are concentrating reinvestment in core
    assets, and disposing of unneeded assets.
        Mr. Chairman, this concludes my prepared statement. And, of
    course, I am pleased to answer any questions you have.
        Mr. Denham. Thank you, Mr. Peck. We have got a number of
    questions here, and we expect that we will have more than one
    round of questioning. But let me start.
        As you point out in your testimony, Administration intends
    to aggressively pursue dispositions of unneeded assets.
    However, the 2012 budget proposed by the administration
    anticipates that GSA's proceeds from sales will drop from $24
    million in 2010 to $16 million in 2012. Why is there a drop,
    when disposal of properties is a priority for the
    administration?
        Mr. Peck. Mr. Chairman, as you know, I will get you a more
    comprehensive answer for the record. But it takes a while to
    get properties into the pipeline, and then to move them through
    the process that we have and out into the marketplace.
        I will have to check on the numbers. It may be just the GSA
    properties that we are disposing. The government-wide total, I
    believe, is in the hundreds of millions of dollars for this
    year. I think you are talking about--remember, there are two
    aspects to our property disposal: properties that GSA itself
    owns and controls; and those that other Federal agencies give
    to us to dispose of. I think you are giving the GSA numbers,
    but I will double-check for the record. We are working pretty--
    --
        Mr. Denham. You would have those other numbers----
        Mr. Peck. We will have--we have the estimates on how much
    we are moving through the pipeline right now.
        And one thing--can I--one thing I would like to highlight
    is we are beginning--for example, this afternoon at noon--an
    online auction of the Fort Worth Federal Center in Fort Worth,
    Texas. It's about a million-square-foot warehouse and 75 acres
    of land.
        Mr. Denham. And GSA does liquidate the properties outside
    of GSA's----
        Mr. Peck. Yes, sir. And it's important, I want to make sure
    we're clear on what we do. GSA owns 1,500 building assets, and
    we at the moment have something like 30 properties that are
    vacant that we ourselves, in GSA, are trying to move out onto
    the marketplace. The Federal Government, obviously, holds
    thousands and thousands of assets. And, on behalf of other
    land-holding agencies such as the Department of Interior, the
    Department of Defense, the Department of Energy, we--they--when
    we find that they have excess assets, or surplus assets, we
    then move them out into the marketplace.
        Our job--if you give me a minute--is to take assets that an
    agency describes to us as no longer being needed for their
    purposes in the Federal inventory, to then, in essence, market
    those properties to other Federal agencies and see if anyone
    else in the government needs it, because we are the
    government's central real estate clearinghouse. If we don't
    find anybody in the Federal Government that has it, then we
    declare the property surplus, and take them through the surplus
    property process, which I think Members of the Committee are
    familiar with.
        Mr. Denham. So the $16 million that we're looking at here
    you anticipate is just from GSA property?
        Mr. Peck. Yes, sir. And that's been confirmed by my staff
    behind me.
        Mr. Denham. And the other properties from other agencies,
    you have direct control over the disposal of those, and should
    also have those numbers?
        Mr. Peck. It's--I mean in most years--and we have stepped
    up our efforts over the last 5 or 6--we have hit a number
    somewhere around, I believe, $300 million in disposals.
        The other thing I will point out, though, is the sales
    dollars that we get understates how much property we actually
    get off our books. Because, in addition to sales--and, in fact,
    more than sales, if you look at square footage--we sometimes
    dispose of properties by giving them away for reduced or no
    compensation to cities and states for specific purposes that
    are stated in the Federal Property Act.
        Mr. Denham. Does GSA retain the proceeds for the non-GSA
    properties that----
        Mr. Peck. No, sir. The--under legislation that passed in
    about 2004, Federal agencies can retain proceeds but they go to
    the agency that was the original land-holding agency.
        So, for example, if the Department of the Interior has a
    property that we sell, all or part of the proceeds go back to
    the Department of the Interior. The only thing we retain is
    we're allowed to take some of our costs out of the proceeds.
        Mr. Denham. Also in your written testimony you had pointed
    out the President has proposed a civilian property realignment
    initiative, a BRAC-like process that we have talked about many
    times. What involvement has GSA had in formulating this
    process, and what would be the role of GSA, and specifically
    the Public Building Service, in the process, should legislation
    be enacted?
        Mr. Peck. Thank you for asking. Since the President issued
    his memorandum last June, GSA has been leading a working group
    of Federal agencies that are taking a look at--that have asked
    agencies to come back with Federal plans. And I should mention
    that this is under the auspices of the Office of Management and
    Budget, but we have been with some of their staff, the arm
    executing the work on the President's memorandum.
        We have been part of a group of Federal agencies that have
    been sitting around the table, figuring out how we can make
    that effort even stronger. And so, we have been a part of
    vetting the President's legislative proposal, and we are
    actually now--legislation or no, we are working together to
    pull together a stronger inter-agency working group to make
    this effort go forward. We are looking at taking detailees out
    of some other Federal agencies, putting them in a GSA space
    which we have, and working on this thing full time, with our
    GSA disposal people helping to lead the effort.
        Mr. Denham. So, under the President's BRAC proposal, which
    I understand is not fully out yet, or vetted, it would not be
    looked--I mean if we're greatly expanding the $15 billion goal,
    does GSA, in the next 3 budgets, have the money and the
    personnel to be able to liquidate that number of properties, or
    are we looking to go out to private companies that can help the
    liquidation process, or a hybrid thereof?
        Mr. Peck. The President's proposal, which was included as
    an--in an appendix to the budget request for this year, asks
    for an appropriation for--to capitalize, in essence, the effort
    of this property effort of about--I think the request is for
    about $80-some million. And then the intention is that, as we
    get proceeds from properties that we sell, we would replenish
    and increase that fund.
        Let me say there are two reasons for that dollar amount.
    One is to pay for private-sector expertise, where we need it to
    do analysis of the properties and possibly to help take it to
    market. I should note that right now, when we do disposals, we
    sometimes use private brokers to help sell them under a blanket
    purchase agreement.
        But we also need some of the money because, in some cases--
    I will give you an example from some of our buildings. We have
    a couple of buildings that we report as partially vacant. And
    if we have as much of--in a case where we have a third of a
    building vacant, if there are other Federal agencies in the
    area, what we would like to do is have enough money to be able
    to move people out of the partially vacant building,
    consolidate them into other buildings, and create a vacancy--
    and totally empty out the partially vacant building and put it
    on the market. It takes some up-front money to do that, as they
    learned in the Defense BRAC, as well.
        One other thing, Mr. Chairman. The $15 billion is a goal
    that the administration put forward in the President's press
    briefing last week. It is a $15 billion----
        Mr. Denham. We expect to exceed that goal.
        Mr. Peck. We would love to, as well. But let me say one
    thing, that, again, I want to note that there are two ways to
    look at the numbers. One is how much money do we get from
    selling. The other is the savings that we get from not
    operating and maintaining vacant properties. And even when
    they're totally vacant, people say, ``Well, how much can that
    cost?'' Well, you have to secure them, just so people don't
    break into them, so they don't become nuisances in their
    communities. And there are some costs of keeping them----
        Mr. Denham. $6 million a year for the Old Post Office,
    correct?
        Mr. Peck. Well, it's--you know, again, the Old Post Office
    has tenants in it. But we do lose money on it.
        Mr. Denham. Thank you. And just as a side note before we
    start a round of questioning, I'm looking forward to watching
    the online auction today on how things go with the Fort Worth,
    Texas property. But it did come to my attention that this
    committee held a hearing on that in 1997. Why has it taken so
    long to get to this process?
        Mr. Peck. Well, I can tell you, as Jeff Zients said in his
    press briefing last year, a couple of things. One is we had to
    move some--we had some of the warehouse space partially
    occupied, and we were--I don't know--I can't account for before
    2007, which is the farthest back time that I have been briefed
    on. But we did have to move some people out of the warehouse so
    it could become vacant.
        And then we spent a long time talking to local officials
    about their interest in taking the property. And as you and I
    have discussed, and as Jeff Zients, the deputy director of OMB,
    mentioned in his briefing last week, sometimes local political
    considerations really extend the amount of time that it takes
    us to get properties out on the market. The process that allows
    us to talk to states and localities looks like it has a time
    bound to it when you look at our process. But I will just say
    it sometimes gets extended.
        Mr. Denham. Political from both the local level, as well as
    sometimes Members from Congress that may have an interest in a
    specific area, or----
        Mr. Peck. Yes, sir. And, more often than not, it's--
    localities have legitimate uses to which they want to put the
    properties. But we have, in law, some fairly narrow purposes
    for which they can get it at a discount. And if we can't give
    it to them under that law at a discount, which usually means
    for free, we talk to localities about paying fair market value.
    And then, sometimes negotiations become protracted.
        Mr. Denham. Thank you. And as we discussed yesterday, some
    of the challenges with putting a property like this on auction,
    as well as the timing, again, one of the things that this
    committee is looking for that we had discussed 30 days ago was
    how to streamline the process. And we still look forward to a
    list of recommendations on that.
        Mr. Peck. Thank you.
        Mr. Denham. With that, I would like to start our five-
    minute round of questioning. First Member would be Mr.
    Crawford, our vice chair.
        Mr. Crawford. Thank you, Mr. Commissioner, for being here
    today.
        In your written testimony you highlighted GSA's vacancy
    rates in leased space, as compared to the private sector. How
    are those GSA vacancy rates formulated, and do they take into
    account the actual utilization by tenant agencies?
        Mr. Peck. The fair answer is yes and no, sir. The way we
    count tenancy and occupancy--and I have done this in the
    private sector--is the way a private sector landlord would. If
    a Federal agency is paying us rent on the space, we count it as
    occupied space. That--and the ``no'' part of my answer is that
    that could mean that an agency is, by our own standards, not
    making the optimum use of the space. Or, in some cases, we have
    a lease on space where one agency has downsized and another one
    has increased, and we are moving people in. So there are
    occasional vacancies, too.
        And I want to be clear. This is not--we are in a very
    different situation from the private sector. This is not a
    knock on the private sector. The private sector has vacancy
    because the economy has contracted more than in previous
    recessions, for example, where the private sector may have
    overbuilt. So I don't--this is no knock on them. In our case,
    we are much more able to control the tenancy. We just--when we
    lease space, it's because we know we have a real need for it.
        Mr. Crawford. OK. Thank you. In the 2012 program, GSA
    included a number of projects intended to avoid costly leases,
    including the consolidation of the FBI in San Francisco, and
    back-filling the Veterans Benefits Administration into a
    Federal building in Missouri. What would be the avoided lease
    cost for those projects?
        Mr. Peck. Let me--unless someone behind me knows
    immediately, it's something I can provide you for the record.
    It's a finite number.
        Mr. Crawford. OK, sure. If you want to, provide that for
    the record a little bit later on.
        And then I have one other question here I would like to
    ask, if I could. Can you explain why the request for energy and
    conservation measures has doubled from $20 million in 2011 to
    $40 million in 2012, especially given that most of the $5.5
    billion Recovery Act funds went to converting buildings into
    high-performance green buildings?
        Mr. Peck. Yes, sir. The Recovery Act funds of the $5.5
    billion, about $3.5 billion was money to be--to put--some of it
    was new construction, and $3.5 billion was money to put into
    repairs and alterations in our buildings that included not just
    greening the buildings, it included, in many cases, total
    building rehabilitations, where we had a 40-year-old building.
    So it means replacing the roof, replacing facades, all that
    kind of stuff.
        In every case where we did that, we did green the
    buildings, that's absolutely true. But even that didn't reach--
    there was something like 270 major building renovations
    projects. We have 1,500 buildings. And so there are still
    buildings that need work on their energy and water
    conservation. And these funds generally go to smaller things
    that you can do to buildings, like putting in smart meters,
    low-cost technology upgrades that can make a difference.
        Mr. Crawford. OK. And I've got a little bit of time left,
    so I am going to ask you another question. Can you explain why
    two of the most costly projects included in the President's
    budget for 2012 include an FBI consolidation in San Juan,
    Puerto Rico, at a cost of $146 million, and the renovation of a
    Federal building and courthouse in Hawaii at a cost of nearly
    $200 million? Can you talk about the need for each of those
    projects, what the utilization rates are, and how they save
    money?
        Mr. Peck. In the--in Hawaii, there are two issues in the--
    I'm not going to try to pronounce it again--the PJKK Building,
    as it's affectionately known. The building is--it's an old
    building. It's had some major--we don't have structural issues,
    but we have some major facade issues, water infiltration in the
    building, and it's--mostly it's--in that case, it's mostly an
    operating asset.
        And we operate like a private-sector landlord in this
    sense. At some point a building gets to the point where it's no
    longer functional. We can, by investing that money, save money
    on operating costs. And I will say that, since we do operate
    like a business in the sense that we have a rent roll--we're
    mostly self-financing--when we do that we are also able, over
    the years, to recapture our investment by raising the rent,
    because the building will now be a higher class building.
    That's in that case.
        In the FBI--in Puerto Rico, there are--I will get you the
    utilization rates in the building, but I'm going to just say to
    you, sir, that, looking at our inventory, utilization rates in
    general could be improved.
        Mr. Crawford. OK.
        Mr. Peck. I'm not going to--I will see what they are in
    that building, but I think we could improve. And I'm looking
    forward to having an opportunity to discuss with you some of
    the things that we're doing to do that.
        Mr. Crawford. OK. Thank you, Commissioner. I yield back,
    Mr. Chairman.
        Mr. Peck. Thank you. Mr. Hultgren?
        Mr. Hultgren. Thank you, Mr. Chairman. Thank you, Mr.
    Commissioner, for being here. A few questions.
        The President proposes over $200 million for projects
    related to DHS consolidation at St. Elizabeths in D.C. Can you
    explain how these projects fit into the overall consolidation
    plan, and what is needed for Coast Guard's occupancy of its new
    headquarters?
        Mr. Peck. OK. The Coast Guard building is well along, as
    anybody who flies out of National and gets to sit on that side
    of the plane will notice. We are on track to finish that
    building. We have got funding for the Coast Guard building. But
    there are associated projects at the DHS headquarters that are
    essential, both in the fiscal year 2011 and fiscal year 2012
    programs.
        So, let me just restate. The purpose of the consolidation
    is to get--as we all know, one of the issues on homeland--with
    improving homeland security is getting the various agencies
    that are involved to coordinate better, so that they coordinate
    intelligence and operations. And the idea is to get their major
    operating entities up on the St. Elizabeths campus.
        The next phase of projects, the immediate next phase of
    projects in fiscal year 2011, in fact, is to create the
    national operations center, which is, obviously, the heart of
    their operation. There is some construction on that going
    underway at the moment. The space for the Secretary's
    headquarters--again, the heart of the agency--is next on the
    agenda. And there is a lot of infrastructure work that has to
    be done so we can continue with some of the other buildings
    which will house aspects of--parts of customs and border
    protection.
        Mr. Hultgren. The President's proposal requests funds to
    begin a repair and alteration project for a Federal building
    for ICE in Los Angeles. Wonder if you could just talk briefly,
    too, how you see that this project would save money and
    increase utilization.
        Mr. Peck. I'm sorry, tell me----
        Mr. Hultgren. The ICE in Los Angeles.
        Mr. Peck. Oh.
        Mr. Hultgren. For ICE----
        Mr. Peck. That's a--oh, that's a good story. That was a--we
    were going to do a--what's called a lease construction project,
    a project in which we go out in the private market and ask
    someone to basically do us a build-to-suit project. And we have
    converted that to a government construction project.
        The advantage is--I am going to be clear about what I say
    about leasing. As with any corporate real estate operation,
    there should be a mix of leased and owned space. You generally
    lease space when you have relatively short-term needs, or needs
    that you think you might have to move around. When you have
    permanent operations that you know will be around--and
    generally it's for more than 15 to 20 years--it makes sense
    over time to own the asset.
        And so, this is a product that we converted from leasing to
    construction. And, in the long run, that means that we--that
    the Federal buildings fund, which is basically a revolving
    fund, will retain the revenues and make enough of a net income
    to be able to do those things we have to do in our inventory.
        Mr. Hultgren. OK. So you do see it with the ICE project,
    there is a net savings?
        Mr. Peck. Yes, sir. I could get you the net present value
    difference between leasing and ownership, as well.
        Mr. Hultgren. That would be great, if you could. Thank you.
        The President's proposal also requests funds for the FBI
    record center in Frederick County, Maryland. Why is this space
    needed, and how will the project cut spending and improve space
    utilization, as well?
        Mr. Peck. There is a long and, in the end, I think, a good
    story here. We have been--the FBI has needed a place for its
    records. A lot of things are digitized these days, and so they
    need different kinds of record storage facilities. They still
    have a lot of paper records. And they have needed this for a
    long time.
        But because of technology, we have been able to--this
    project has gone from at one time being nearly a million square
    feet down to where it is today, which I think is a little over
    300,000.
        And again, at one time we were talking about a lease
    construction project, and this too has been converted to a
    request for funds to build it. I mean this is a classic kind of
    a warehouse records center kind of a facility that we're going
    to need for a long time.
        Mr. Hultgren. So with the smaller size, though, it does
    appear that it would still accomplish the purposes of the FBI,
    but also would have the utilization that we really need there?
        Mr. Peck. Yes, sir.
        Mr. Hultgren. OK.
        Mr. Peck. We have taken out of it at least one minor
    function that they don't feel needs to be collocated there.
    But, because of technology and another look at how they do
    their work, we have been able to skinny it down.
        Mr. Hultgren. I'm going to switch just a little bit. I've
    got just a little bit of time left here.
        But dealing with border crossings, the 2012 program
    includes funding for a number of land ports of entry. As you
    know, last year our committee had concerns that some of the
    Recovery Act funds were going to border crossings that saw very
    little traffic. Can you provide the committee with the traffic
    and utilization rates for each of the facilities in the
    President's budget?
        Mr. Peck. Yes, sir, I will. And that's in the--these
    projects were screened by looking at where we have the most
    cross-border traffic.
        Could I just say I was in--about a month ago I went down
    to--looked at a number of the border crossings in Arizona and
    our border crossings in El Paso, and there are places in which
    the trucks line up for, sometimes, eight hours to get across
    the border. It increases--they need to be screened, there is no
    question about that. But it increases cost to the American
    consumers when that happens. And so we have--I will get you the
    counts.
        Mr. Hultgren. Thank you, sir. Do I have time for one more
    question, or----
        Mr. Denham. Absolutely.
        Mr. Hultgren. In your testimony you note that the
    Department of Transportation has requested $2.2 billion in
    their surface transportation funding for critical facilities at
    the borders. These funds, you note, would be transferred to GSA
    out of what the DoT account--I'm sorry--out of what DoT account
    would these funds come from? Is it from the highway trust fund,
    or from another account?
        Mr. Peck. I think--yes, it's service transportation funds,
    but I'm going to have to--I want to--I know a little bit about
    this. I want to find out if it's from highway trust funds. I
    don't believe so.
        Mr. Hultgren. Well, if you can get that to us, as well----
        Mr. Peck. I will.
        Mr. Hultgren [continuing]. That would be great. I will just
    keep going, if that's OK, until they cut me off.
        Would the $2.2 billion in DoT funding be for actual
    construction of new buildings and facilities, or for the roads
    leading to the facilities?
        Mr. Peck. It's mostly design and construction. But in a lot
    of cases on our facilities as they are, we--well, not in a lot
    of cases. In some cases we do pay for some of the road
    infrastructure, although generally that's done by the state
    departments of transportation.
        But there are cases in which, because if we just plunk a
    land port of entry--a new one--down we will create terrible
    congestion, we do spend some of the money outside the ports as
    well.
        Mr. Hultgren. OK. Will we receive prospectuses for the
    projects funded with the $2.2 billion in DoT funding?
        Mr. Peck. No, sir. I believe on that--am I right? On that
    account you would get a spending list, somewhat the way we did
    on the American Recovery and Reinvestment Act. I note, though,
    that transportation funds come through this committee as well,
    so you would certainly have every opportunity to review it.
        Mr. Hultgren. OK. One last thing, if I could sneak it in,
    you highlight in your written testimony again that more than
    10,000 jobs have been created through GSA's $5.5 billion that
    was included in the Recovery Act. Do you have a breakdown of
    the types of jobs created, and how many of them are long-term
    permanent positions? And, if you do, could you get those to us?
        Mr. Peck. I will. But I should say they are--these are
    generally not long-term, permanent positions. These are design,
    architecture, engineering, and construction jobs.
        Mr. Hultgren. OK. But if you could, get us a list of
    approximate time for those positions, and just a follow-up of
    how that's gone.
        Mr. Peck. I will. Actually, on those, I have to tell you we
    have been very scrupulous about that. We even go out and ask
    our contractors on a monthly basis, I think it is, to give us
    their breakdown of their jobs.
        Mr. Hultgren. Great. Thank you, Commissioner. Thank you,
    Mr. Chairman, for your indulgence. I yield back.
        Mr. Denham. Thank you, Mr. Hultgren. Obviously, we went
    over the five minutes because there is some new questions that
    have come up under this. I didn't realize that the $2.2 billion
    is coming from the highway trust fund.
        Mr. Peck. I believe it is not coming from the highway trust
    fund. It is coming from the Department of Transportation. We
    are going to check and find out if it's highway trust fund
    money or appropriated funds. Generally, appropriated funds.
        Mr. Denham. Because the highway trust fund would go to fix
    roads and highways.
        Mr. Peck. Correct. We know that. And the reason that the
    money would come from the Department of Transportation is that
    this is--has a lot to do with cross-border traffic and trade.
    And the administration felt that it was--that the DoT funding
    was appropriate to carry this activity.
        You will see the--in the projects that we are going to
    propose, you are going to see they're mostly from congested
    land ports of entry.
        Mr. Denham. OK. And even though this is DoT funding--I know
    you're going to go back and see which fund this is coming out
    of--but DoT funding, and we're not going to receive
    prospectuses on this?
        Mr. Peck. That's--it would be because it's a transfer of
    funds, somewhat the way the American Recovery and Reinvestment
    Act was carried out. We would provide a list of projects that
    we would propose to fund under it.
        I think some of the thinking has been, Mr. Chairman, that
    this committee obviously funds the Department of Transportation
    and the transportation program as well, and would have every
    opportunity to review the list of projects. It's a matter of
    legislative interpretation that funding that comes to us
    outside of the public buildings fund, the Federal buildings
    fund, doesn't go through a prospectus process.
        It doesn't mean that we aren't--that you aren't welcome to
    have a hearing and make whatever decision you make, because
    it's going to be a full--it's going to be a request for at
    least an appropriation. And I believe that an authorization to
    the Department of Transportation, but I have to check on that.
        Mr. Denham. We can obviously hold a hearing any time we
    find out new information. This seems like it is trying to get
    around the process, almost like a blank check. We're going to
    go out and spend the money, and then we will tell you where we
    spent it afterwards.
        Mr. Peck. No, sir. I mean you will get a list of proposed
    projects to review before any spending is done. Yes.
        Mr. Denham. When do you expect to have that list?
        Mr. Peck. I will have to get back to you on that. I don't--
    it's not being developed--there is a draft list, and I don't
    know where it is at the moment.
        Mr. Denham. When do you expect to spend the money?
        Mr. Peck. Well, it's for fiscal year 2012, so we would
    propose to start at the beginning of the fiscal year, if we get
    it funded.
        Mr. Denham. So, similar to our prospectus, you must have
    some information on it----
        Mr. Peck. We do. There is--like I said, there is a spending
    list that is not--a project list that has not yet been cleared
    for submission to the Congress.
        Mr. Denham. Thank you. Chairman Mica? Five minutes to
    Chairman Mica.
        Mr. Mica. Thank you. And thank you, Mr. Chairman. And
    welcome, Mr. Peck. Good to see you today. I know you're talking
    a bit about some of GSA's capital investment leasing program.
        I always go back to my favorite subject, which is the
    consolidation of the FTC current space. And for some time now
    you have had before us a prospectus to lease a total of over
    400,000 square feet. And we have one lease expiring, the FTC
    currently has their 306,000 gross feet of space in the Apex
    Building, where they are headquartered now. And then they have,
    on New Jersey Avenue, I think, another over 200,000 square
    feet. And then they lease a smaller amount of space. And there
    was the possibility of getting a third building for them, or
    consolidation.
        Now, the New Jersey space lease expires. Is that in 2012 or
    2013, do you recall?
        Mr. Peck. Checking my--expires in August of 2012.
        Mr. Mica. 2012. The other thing, too, is I know some time
    ago you did propose leasing additional space for them, and they
    have additional requirements. We also have the Apex Building in
    which they are housed as 306,000 gross square feet, a net
    usable of 258, and they're using 180, or maybe a little more
    than that currently, with somewhere between 450--and they
    claimed up to 700--employees. But that request for additional
    space--have you been in consultation with them on their space
    needs?
        Mr. Peck. Yes, I have not personally, but we certainly
    have, as an agency. Yes, sir.
        Mr. Mica. And when we received the prospectus last year I
    had pretty much the agreement of the former chair of the
    committee to try to move forward with the consolidation of--
    approval on moving forward. And, as you know, we passed a
    resolution.
        I have been here a while. It's sort of unprecedented to
    have a resolution of the nature we did in response to a
    prospectus request. Isn't that--that's sort of unusual. I know
    it puts you----
        Mr. Peck. Right.
        Mr. Mica [continuing]. In a dilemma, but I think it set
    forth some of the issues that we felt were important. You
    provide us with a prospectus and a request, and then I thought
    it was incumbent on us to pass or adopt a resolution that
    stated our position.
        I know that puts you in a little bit of an awkward
    situation, and there has been a certain amount of lobbying by
    the FTC commissioners to retain their space. Have you
    undertaken yet, or your folks undertaken yet, since we have
    passed the resolution, any discussions with FTC about, again,
    consolidation of space or meeting their space needs, given that
    we are intent on trying to transfer their building to the
    National Gallery of Art, so they don't have to lease additional
    space outside, and could consolidate some of their operations?
        Mr. Peck. Mr. Chairman, I have not talked to them. I don't
    know that anyone else in GSA has, but I have not personally
    engaged them since you all passed the resolution. But I intend
    to. And I would like to, if I could, lay out a couple of points
    of view, and see if we can continue a discussion soon about----
        Mr. Mica. We would like to work with them. My intent is not
    to deprive them of any of the space that they need, but rather
    to look at a consolidation that makes sense. Folks have quoted,
    you know, Roosevelt, when he dedicated the building. We went
    back and researched the--when the building was dedicated in the
    1930. In fact, it was a consolidation of multiple FTC locations
    around Washington that they put into one building. And now we
    have a situation where they need much more beyond this space
    than they have in the headquarters.
        And you also came to us with their request for additional
    lease space, which we think would make sense, and finding
    something suitable--and Ms. Norton, of course, would like that
    in the District--and I think there could be substantial
    savings. Our resolution outlined that.
        Plus we have the unprecedented situation of the National
    Gallery of Art being willing to come in and renovate an 80-
    year-old building, and again relieve of us leasing space that
    they currently lease, and meeting their space requirements for
    the future. So, it's not a wild-eyed proposal, but I think it
    also has the potential--if you start out with $200 million in
    saving and renovating a building, eventually you will have to
    renovate. I saw the figures, 138, but I think it will be closer
    to the $200 million mark by the time you get through giving,
    again, the cost of projects we have seen that we have a pretty
    good handle on.
        We have no intent on changing--our proposal wouldn't change
    the facade in any way, and I think that many more people would
    access the structure. They have 4.5 million versus 450 or 600
    or 700 that go into the building every day now, which would
    again provide an opportunity also to let people know that that
    was historically their building, what the FTC does, and they
    wouldn't be lost, so to speak, in the mix.
        The other thing, too, is we outlined in legislation we
    passed in the transfer--you have space coming up at the GSA
    building, we have space behind us next to the Ford building.
        And we have also heard--and I won't get into public
    discussion of it--several other agencies that might like to
    relocate that are in the District that--this might be a good
    time to be looking at those kinds of deals, where they, for
    security or other reasons might want to relocate or spread out
    some of our activities in national security interest that I
    think you're aware of.
        So, we have a number of choices. The committee will work
    with you. We will be willing to sit down, if--I know the FTC
    commissioners like their view and their particular setting
    right now, but that's not--that shouldn't be the paramount
    question. It should be the net savings, the--providing adequate
    space, both for the FTC and for the National Gallery, and doing
    it all in a responsible fashion that looks out for the
    taxpayer, too. Because I know you will work with us and
    appreciate it.
        And if you see any obstacles, too, that we can assist you
    with, I want to make certain that you know that we have
    initiated this process, and we are willing partners to work
    with you to find a satisfactory resolution. It's not something
    we just want to cram down people's throats or act on in a
    singular fashion. It has to be a cooperative effort. We know
    that.
        So, again, I look forward to working with you on it. And if
    you start those discussions, you can let Mr. Denham know, and
    we would be glad to join you and, again, look for positive
    solutions.
        Mr. Peck. Mr. Chairman, may I response?
        Mr. Mica. Yes.
        Mr. Peck. First, I really--I very much appreciate your
    statement. And, as you know, I once worked at the National
    Endowment for the Arts. I have been friends with two directors
    of the Gallery, and I----
        Mr. Mica. I didn't know all that.
        Mr. Peck. It's the--it's a--it's one of the great art
    museums in the world. And I think doing what we can for the
    National Gallery is--should be a high priority for the
    government, as it has been since the Roosevelt administration.
        I very much appreciate your concern, as is ours, and we
    have discussed this, that we--since the strategy, which the
    committee and GSA mutually has pursued for a long time is
    trying to keep government agencies in government-owned space as
    much as we can, we have a concern which you have just
    expressed, too, that we try to keep the FTC in government-owned
    space.
        I will just add two things. One is that, as you noted, I
    have a--we have a tenant, a client who wants to stay in their
    building, they are wedded to it. That's kind of a good thing,
    because it's a beautiful building, and I appreciate the fact
    that they like it a lot.
        And finally, I will just say I will take you up on the
    suggestion that we talk to staff and Chairman Denham about how
    we proceed on this. As you note, there may be alternatives. I
    need to talk to the FTC. And at some point soon we should try
    to find a way to satisfy all the parties, including--as I
    recognize--the needs the National Gallery of Art, and us, to
    keep the FTC in government-owned space.
        Can I also assure you that I have spoken to Chairman Denham
    any number of times, and he has never once failed to include
    this on his list of issues?
        Mr. Mica. Well, again, we have certain priorities. This is
    my priority, working with Mr. Oberstar--and we were close to an
    agreement at that point.
        And I think the other thing, too, is we have to do things
    that are in the best interest, long-term, of the government.
    And this is our Nation's capital. And I think, looking to the
    future and what we're leaving here, the National Gallery, which
    is the repository of our Nation's treasures, FTC, which has an
    important function, we can both serve their needs in a
    responsible way for the taxpayers and for the mission that
    we're responsible making certain they complete.
        So, I look forward to working with you. I know we put you
    sometimes in a difficult position. We will be working with the
    other body now. But I can assure you that, one way or the
    other, that this transfer will take place, and we want to work
    with you to make it as smooth as possible.
        Mr. Peck. Mr. Chairman, this is a great job that the people
    and the President have allowed me to have. And dealing with
    issues with this is one of the challenges that I welcome taking
    on.
        Mr. Mica. And I will just tell you I have no other priority
    for the balance of my tenure in Congress, so I am sort of
    focused on this. Thank you.
        Mr. Peck. All right. Thank you, sir.
        Mr. Denham. Thank you. We are going to continue on
    questions a little bit further here, specifically the
    evaluation process on how you take a look at weighting
    different properties and how you sell them.
        When you're prioritizing projects, are you looking at
    mission urgency, energy conservation, return on investment? How
    are the different factors weighted?
        Mr. Peck. OK. You're talking about repair and--when we do
    the--look for repair and alteration projects and mostly--or new
    construction?
        Mr. Denham. Yes.
        Mr. Peck. Either one?
        Mr. Denham. Well, as you're evaluating projects as a whole.
    I mean, if you have one that may not be utilized completely,
    you know, before that goes out to other agencies and other
    uses, are you also weighing in that proposal different weights
    on--you know, is it going to--do you have extensive TIs, do you
    have energy conservation----
        Mr. Peck. If you're asking about properties that we think
    are close to being excess or surplus, we--there are two
    different levels on which I think we should all be talking
    about our surplus properties.
        One is--and this will also describe the process that we are
    going though right now, under the President's memo, and
    hopefully under some kind of legislation to go deeper--is, one,
    we have properties that we know are either unused or almost
    unused at the moment. And as I said, when the ones that are
    almost done used--meaning that we have enough vacancy or enough
    underutilization that we think that we can move out--we take a
    look at, ``Is it a property worth putting more investment in,
    so that we can get more people into the property and use it
    better?''
        Some properties, I should note, in other agencies--you can
    imagine; I will just give you a--the example that people use a
    lot is at one point lighthouses were important to the country.
    And then, obviously, technology overtook them and the Coast
    Guard had a lot of excess property on its hands. Even there, we
    asked other agencies if they could use that kind of property on
    the coast. And in many, and probably most, cases the
    lighthouses went out to somebody else. So, there are those
    things, where you say, ``All right. Can anybody use it?''
        There are properties in which you--that--in our
    properties--more often, say a Federal building, we have areas
    in which we ask ourselves the question, ``OK, if we have
    vacancy in a Federal building, should we take it to--should we
    try to tenant the building, or is this an asset that's not
    worth spending the money on?'' And you can do--you can crunch
    the numbers on it. Because we charge rent, we can figure out
    what our return on investment would be.
        Mr. Denham. So, how often do you crunch the numbers? I mean
    do you do a general assessment for every property, all 1.2
    million properties, to see exactly where we are? Because some
    of these properties may not have been assessed for decades.
        Mr. Peck. No, I'm talking about GSA properties now.
        Mr. Denham. OK. So----
        Mr. Peck. Yes. GSA properties, we have three tiers of
    properties. We--there are short-term holds, meaning we're
    looking to get rid of them; medium term, and we--we're not
    sure; and long term, that we are going to keep for a long time.
        For our other properties--and can I just say that for the
    other properties and other government agencies, one of the
    issues that I think anyone will tell you we have in the
    government is that there are--we don't, as GSA, review other
    agencies' properties, at least haven't until the last year,
    unless and until the agencies report them as excess to us?
        I will qualify that only through this. We have a very
    entrepreneurial, aggressive disposal staff in GSA, and when
    they get word one way or another that an agency has a property
    that may be underutilized, they have in the past gone out to
    the agency and said, ``Is this possibly an excess property?''
        I think anyone who has looked at this business over the
    last 20 to 30 years would tell you that there are properties
    that agencies sometimes hold on to in the wish, in the hope,
    that some day they will get the funds to do something with it.
    They may even have legitimate plans.
        But there comes a point--and this is where I think we ought
    to work together--there comes a point where it's pretty clear
    that we're not going to get the funding to do it, that the uses
    to which an agency wants to put the property are not going to
    come about, and that we ought to get them out of the inventory.
        And what percentage of underutilized properties are in that
    category that we could move them into excess, it's really hard
    to tell at the moment. But I think in the next six months or
    so, we will have a much better handle on that.
        Mr. Denham. Just under GSA properties, 1,500 properties----
        Mr. Peck. Yes. Yes, sir.
        Mr. Denham [continuing]. You begin your evaluation based on
    underutilized properties, and then push them to become surplus
    properties at a certain point when you deem the criteria not
    met?
        Mr. Peck. Right, right. As you will note, we don't have all
    that many. We have--most of our properties are in major or
    almost major metropolitan areas, in which there is a continuing
    Federal need. So if we own a Federal building and some agency
    moves out, we almost always have someone we can move in from
    leased space.
        We do, however, have some smaller properties in outlying
    locations around the country where we--too, if we find a
    vacancy, we decide, you know, it's probably not worth putting
    the money into the building. And in that case we might dispose
    of it and lease what space we need. But we just do a financial
    analysis, like--that's fairly straightforward, and just like
    anybody in the real estate business would do.
        Mr. Denham. But there is nothing that would alert you or
    your team, unless you have one of the properties that's up for
    a new lease, if somebody moves out or----
        Mr. Peck. Oh, no. I'm sorry. We, on a rotating basis,
    continually look at our own inventory. We have a portfolio
    management office in our national headquarters and in each
    region, and their job is continually, whether we have something
    moving in the building or not, to take a look at it.
        Mr. Denham. Continuously, or random?
        Mr. Peck. Continuously. And the way that--the----
        Mr. Denham. So, how often?
        Mr. Peck. Well, I--I'll tell you what drives it. I will
    tell you why it's a continuous process. Every year we put out a
    call. We have, as I said, a benchmark of wanting to spend
    something like two percent of the replacement value of our
    inventory on repairs and alterations. We put out a call to our
    operating elements, our 11 regions every year, and say, ``Given
    your inventory, tell us''--you know, ``do an evaluation of the
    inventory that you hold, and tell us which of the buildings you
    think need a repair and alteration investment in them.''
        We have hurdle rates. We know how much of a return on
    taxpayer dollar put into that building we expect to get back in
    increased rents or increased usage. So--and as I said, we have
    already tiered all of our properties into three tiers in which
    we know which ones we think are short, medium, and long-term
    holds.
        I will note in the early 2000s, GSA disposed of a number of
    properties, and we actually sold off about $220 million worth
    of properties as a result of that kind of tiering of the
    inventory.
        Mr. Denham. So the 1,500 GSA properties have all been
    evaluated at some point in the recent past?
        Mr. Peck. Yes, sir.
        Mr. Denham. So you know----
        Mr. Peck. You know, I have--first of all, one of the great
    things about GSA is we have weekly, monthly data on vacancy,
    rent rolls, by asset, by region, and nationally. So we're
    constantly looking at where we have vacancy, where we're not
    getting--at the beginning of every year we have a budget for a
    building. And if we're not getting the rent that we expect from
    the building, we go to people and say, ``What's happening here?
    Does that mean that nobody is in the space?'' And so we have
    that.
        We have asset status studies on every single one of our
    buildings. And let me ask how--what's the longest period a
    building could go before the asset study gets reviewed? Every
    building, every year, is going to get some kind of a review of
    its asset status.
        Mr. Denham. So you are confident that the 1,500 properties
    under your purview, you can tell me, square footage, how many
    people are in there, what it's worth, what the ROI is?
        Mr. Peck. Yes, sir. Yes, sir. I want to be--I want to make
    the other point I have made to you before. Take the GSA
    building. One of the things we are doing as we are looking at
    renovating it is that we could probably assign--we will assign
    a lot more people to the building.
        So, when we say our main Federal building in a city is
    fully occupied, it is. We are in the process of talking to a
    number of Federal agencies intensively about how well they
    utilize that space. Some of them are--we're probably not far
    off from current industry benchmarks, but the industry is
    moving. A lot of progressive firms are moving to a point where
    they can get a lot more people into a lot less space, because
    they just recognize that people can work from anywhere.
        So, I think you will see, over the next year or two,
    strenuous efforts on our part to increase the space
    utilization. And that, in itself--the reason I'm saying that is
    that that in itself may mean that what we regard as a fully
    utilized occupied building today may not be--that may not be
    the same standard we apply to it years from now.
        Mr. Denham. On top of the 1,500 properties that are
    directly under your purview, how many leases go through GSA?
        Mr. Peck. We have about 8,100 leases, and----
        Mr. Denham. So----
        Mr. Peck. Around the country.
        Mr. Denham. So does GSA oversee all leases under the
    Federal Government?
        Mr. Peck. No, sir.
        Mr. Denham. What----
        Mr. Peck. We are--when you look at the--if you look at the
    data, I believe we are the government's largest leasing agency
    in the United States. But other agencies have their own leasing
    authority. The Army Corps of Engineers does some leasing on
    behalf of the military. And some other agencies also have their
    own authority. So we're not the only ones. But we are the--at
    least the largest lessee in the Federal Government.
        Mr. Denham. So what type of oversight is there over the
    independent agencies?
        Mr. Peck. The independent agencies are--and what I'm
    describing there are agencies that have their own legislative
    authority. We sometimes delegate authority to a government
    agency to do leasing that would otherwise be done by GSA. And
    in that case it's our responsibility to make sure that they
    follow--that they're following the government's procurement
    rules.
        If an agency has their own independent legislative
    authority, they are responsible themselves for following the
    Federal acquisition regulation and all the other things that
    you have to do to do a lease.
        Mr. Denham. SEC is independent?
        Mr. Peck. They have their own legislated leasing authority.
        Mr. Denham. So should those leases not go through you?
        Mr. Peck. I would say, given the recent experience of the
    SEC, I would say we would have done a better job than they did.
    By which I mean, just to be fair, when agencies come to us with
    space requirements, we have ways, including checking back with
    the Office of Management and Budget--where they say that they
    need space to expand their activities, we check to make sure
    that the activities are actually budgeted for expansion. That's
    a crucial step.
        Mr. Denham. I would agree that is a crucial step.
        At this time I would like to yield five minutes to Ms.
    Norton, as well as an opening statement, if you would like.
        Ms. Norton. Well, I thank you very much, Mr. Chairman. And
    first, I offer my apologies. There was a mark-up involving a
    bill directly affecting the District of Columbia. It has just
    ended, and I could not leave. I always know that if I leave
    when a District of Columbia matter is up, the Congress could
    sell the District. So I stay on duty.
        I did want to--however, I am not going to read my opening
    statement, but I am going to summarize what was--what is in my
    opening statement.
        And I want to say to you, Mr. Peck, that you will note that
    the chairman has proceeded, although we have not yet received
    all the prospectuses for the 2012 program, and I endorse the
    chairman's resolve. If your prospectuses aren't up here, too
    bad. Because what he is trying to do--and I'm going to say we
    should have done a better job with this--is to make sure that
    the authorizers indeed have acted before the appropriators do.
    So, I fully endorse the chairman proceeding with the 2011 and
    2012 budgets.
        I do want to note that your submission involving $1.7
    billion capital program, while it's modest in keeping with the
    President's intention to submit only what he regards as
    necessary, that it does represent a 16,000 private-sector
    construction and related jobs. Particularly in the absence of
    any jobs legislation from the present majority, we should
    welcome this small infrastructure contribution at a time when
    jobs are--when unemployment is still so high, and the Congress
    is doing absolutely nothing to respond to that.
        I note that H.R. 1 would totally eliminate the 2011 capital
    program. And I want to just say for the record what that will
    do. That would bring to a standstill, stop in its tracks,
    priority construction projects of the United States, including
    the consolidation of the 22 agencies of the Department of
    Homeland Security. This, of course, is the highest priority
    secured facilities program in the budget.
        Moreover, GSA has said to us in prior hearings that
    delaying the DHS headquarters and other construction related to
    the Department of Homeland Security would cause GSA to extend
    leases for short terms, which is, of course, the most costly
    way to lease for the Federal Government. In other words, we are
    adding to the costs of the Department of Homeland Security.
        If we proceeded, however, and this project is on time, what
    happens when the project is done is $180 million annually then
    goes to the Federal building fund. The Federal building fund is
    much depleted now, so that there is every reason that this
    project, which was a priority of the last administration and
    remains a priority of this administration, will not be stopped
    in its tracks, but proceed apace.
        If you can imagine what--the cost of stopping a project
    that is going full guns, you will have an understanding of why
    it would be counterproductive for us to wipe out the 2011
    capital program. And I don't believe that the Senate or--and
    certainly that the President will allow that to happen. There
    is lots of negotiations that's going to have to go on before we
    get even close to an agreement on 2011, much less 2012.
        The collocation of a number of agencies on the DHS campus
    also avoids leasing in the highest commercial cost leasing area
    in the United States. So there are multiple reasons to not be
    penny wise and pound foolish.
        I want to say how much I appreciate the President's work--
    his proposal to create a BRAC-type commission for Federal real
    estate. He is way out in front of the Congress in this regard.
    But there is great concern in this subcommittee and committee,
    and in a number of other committees, about surplus property
    that the Federal Government has not been able, until now, to
    dispose of. So his idea, it seems to me, is one that should be
    embraced by us all.
        And finally, I want to say to Mr. Peck, the delineated area
    and procurements remains a concern for the subcommittee. We
    are--the lease--I'm sorry, what is the lease? Parklawn lease
    continues to be troubling. We expect procurements to be done by
    the book, carrying out congressional resolutions.
        Mr. Chairman, again you have my apologies. I am pleased
    that you proceeded. This is an important hearing, and you are
    right to go now, early, before the appropriators get down to
    work on this mission. I thank you very much, Mr. Chairman.
        Mr. Denham. Thank you very much. At this time do you have
    questions for Mr. Peck?
        Ms. Norton. I would ask only about the status of the
    Parklawn delineated area issue, which has caused GSA so much
    heartache.
        Mr. Peck. Thank you, Ms. Norton. That would be a good
    characterization of the lease for HHS, which is currently at
    Parklawn. Could I just say I share your concern about the way
    delineated areas are drawn?
        And I think, in part, because of the concerns that this
    subcommittee has brought to us, we are taking a look at it,
    particularly in the national capital region, to make sure that
    we draw delineated areas that maximize competition to get the
    agencies' functions done, and then, when we actually carry out
    our lease solicitations--which is what these are mostly about--
    that we follow the delineated areas.
        As you know, we have scrupulous layers of--we have multiple
    layers----
        Ms. Norton. That procurement has been going on for three
    years.
        Mr. Peck. Yes, ma'am.
        Ms. Norton. And you know what the issue is, Mr. Peck. The
    issue is the Agency deciding where it wants to go, rather than
    GSA deciding what's the best deal for the taxpayers. Why is it
    going on for three years, and when is it going to be settled?
        Mr. Peck. Correct. I can't account for all of the three
    years, I have only been here for a year-and-a-half. An
    announcement on that lease is imminent, is all I can tell you.
    I can't say more, because it's--we're in the--we're in that
    period called procurement sensitivity. But the announcement
    will come very, very soon.
        Ms. Norton. Mr. Peck, here is a sensitive procurement issue
    for this committee. On February 9th--perhaps you remember that,
    it was when you were tortured, along with the entire
    subcommittee, at a hearing in the Old Post Office Annex. And
    you are aware that I would have done that a little differently.
    I would have had you there, and we would have been here,
    because we have been doing the right thing all along. So I
    don't know why we had to be subjected to that.
        But under torture, you said--you committed to either have
    the RFP out on the street for the Old Post Office, or provide
    an explanation of why it is not out. So this is your chance. Or
    you may want to go back to the Old Post Office Annex.
        Mr. Peck. I will provide a written explanation this
    afternoon. But----
        Ms. Norton. No, no. You can give an oral explanation right
    now.
        Mr. Peck. OK. Of course. But I believe I owe the committee
    a--if you like, I will do a written response.
        Ms. Norton, I am just going to say this. I suspect you're--
    frustrated would be probably an understatement--about the Old
    Post Office RFP. And that would accurately describe the way I
    feel, as well. I did not have an RFP on the street today. I
    am----
        Ms. Norton. And what's the explanation for that, Mr. Peck?
        Mr. Peck. You know, the explanation is, despite many
    meetings with the people in the government who have to review
    this, including my own personal participation in it, we have
    not been given a go-ahead to put the RFP on the street.
        Ms. Norton. You mean OMB is in this again? We have got--
    wait a minute. This RFP was very different from any other RFP
    since I've been on this committee, because it was mandated by a
    statute.
        Mr. Peck. Correct.
        Ms. Norton. Now, the last I read, OMB cannot override a
    statutory mandate of the United States Congress.
        Mr. Peck. A point which we have made several times, I can
    assure you.
        Ms. Norton. So--no, I want to know why it is at OMB at all.
    This is not a matter----
        Mr. Peck. Ms.----
        Ms. Norton. This is--Congress said, ``You will, in fact,
    gain revenue for the taxpayers, as you did with the tariff
    building, if this building is remodeled.'' And because OMB got
    in the way then, the Congress said, ``We know what to do. We
    will pass a statute that instructs the administration what it
    is to do.''
        So, the OMB excuse has run out, because it is overwhelmed
    now by a statutory mandate. And we need to know from you what
    OMB's issue is with the Old Post Office RFP.
        Mr. Peck. As near as--I can give you two general concerns.
    One is the details of the RFP itself, and the various
    provisions in it, which I think at this point we have fully
    discussed, and I believe we are over. As you know, I have
    drafted these kinds of things in my private sector as well as
    public sector lives, and I can assure you that we have drafted
    a request for proposals that is tight, protects the government
    interests, and I believe gives private sector interests a full
    opportunity to show what they could do with the building.
        The second concern has been a concern about the cost
    benefit of maintaining the building as federally occupied
    space, and putting it out on the market. And----
        Ms. Norton. No, no. That can't----
        Mr. Peck. And I can tell you that--I have a hunch you're
    going to say what we have been saying, which is that the
    legislation fully anticipates that that analysis will be
    submitted to the Congress, along with a negotiated lease from a
    private sector interest. That is what the legislation says.
        So, that analysis, in my opinion----
        Ms. Norton. You know that there is abundant room to put
    that two cents' worth of agencies in many places, and that was
    the excuse before.
        Mr. Peck. Well----
        Ms. Norton. Look, this building is losing the Federal
    Government $6 million annually. And you are telling us OMB is
    the problem? $6 million each year we lose because of what you
    have to put into the building, just to keep it going.
        Mr. Peck. But what I'm suggest is that I think the
    legislation was responsible, as it should have been, and said,
    ``We will take a look at what the cost and benefits are when we
    have a private sector offerer who says, 'Here is how much money
    I will pay you for letting us use the building,' versus what it
    costs us to have--to continue Federal occupancy in the
    building.'' And that is an analysis which we have done in the
    past, we will do again when we get an offer.
        I am well aware of the opportunity to move the agencies in
    the building someplace else. We have talked to the agencies
    about that. And I am just telling you I am frustrated, I am
    working as diligently as I know how to get this RFP out.
        Ms. Norton. I think you should say to OMB that the
    committee expects the RFP on the street within 2 weeks, 14 days
    from today.
        Mr. Peck. We will be happy to carry that message back.
        Mr. Denham. Thank you, Ms. Norton. The chair yields five
    minutes to Ms. Edwards.
        Ms. Edwards. Thank you, Mr. Chairman. And also thank you to
    the ranking member. I think every day on this subcommittee we
    recognize that the ranking member probably, you know, is
    forgotten more than many of us will know in our service on this
    committee.
        Mr. Peck, I know that you will be heartbroken to know that
    I was almost delayed in another hearing. But I am glad to make
    it here.
        I want to ask you first, to follow up on the Parklawn
    situation--and I know that we're in that critical area where
    you really can't talk about things, but I guess I want to hear
    from you that you have some assurances that the processes in
    which you have engaged, and particularly of late with respect
    to that lease, will not result in litigation that will extend
    this process even further than it has gone on already.
        Mr. Peck. I--the assurance I can give you is that this
    thing has been vetted every which way until Monday inside the
    GSA in an attempt to make sure that we are abiding by what we
    said to the real estate and official and private--for that
    matter, the whole public--in this region about how we were
    going to make the selection on this procurement.
        I can't give you an assurance that someone won't litigate.
    Unfortunately, my experience in this is that on very large
    lease acquisitions like this one, there is almost always
    someone who is willing to take exception to what happened, if
    only because they are disappointed and think they may be able
    to change the decision.
        Ms. Edwards. Well, thank you very much.
        Mr. Peck. But I hope that doesn't happen.
        Ms. Edwards. I mean people--I understand, you know,
    obviously, you know, many of the participants, or some of them,
    somebody is going to be disappointed because they're not going
    to get the procurement. I think I just worry that this
    particular procurement has been so fraught with problems that
    it may result in a deep perception that there is a great
    unfairness, and that that unfairness has to be litigated. And I
    fear that we are going to sit here a year from now discussing
    the same thing. But I am going to go on.
        I want to ask you about an area that has been of great
    concern to me in my time on this committee, and it has to do
    with the lease rate disparities from Maryland to Northern
    Virginia to the District of Columbia, when it comes to leasing.
    I think many of us who live and work here think of this as a
    region, and we don't understand why these disparities exist
    that seem to favor one jurisdiction over another jurisdiction
    that has actually, I think, resulted, and in my view, as a lay
    person, a lot of, you know, concern about fairness of process
    when it comes to those sort of--the higher quality leases.
        So, I wonder if you can explain for the record what the
    reason is for the rent disparity. And then I would like you to
    go down several jurisdictions. Is there a rental rate disparity
    in Denver or New York City or Philadelphia or St. Louis or Los
    Angeles or San Diego or San Francisco or even Baltimore, in my
    own state, that is like the disparity that exists here in this
    region?
        Mr. Peck. There are not. We do not pre-set what we call
    program rates for any of those other metropolitan areas.
        Ms. Edwards. Only for this metropolitan area. And do you
    have any idea, historically or otherwise, what the reason is
    for that disparity?
        Mr. Peck. I have--I don't know why the program rates were
    set in the first place. I have been--I don't know for sure. I
    have been told that there was--obviously, in this area the
    Federal Government is a large lessee. And I believe there was--
    may have been a sense at some point that the Federal
    Government, by setting rates which were presumably market rates
    in advance, or perhaps just below-market rates in advance, we
    could save taxpayer dollars by announcing to the real estate
    community that this is as high as we are prepared to go on
    rent, and no higher.
        Ms. Edwards. Well, I don't really get that, when there is a
    disparity in the region, when you set the high mark. But there
    is a disparity from Maryland to Virginia to the District of
    Columbia. It would seem to me that, especially for people who
    believe in the value of the marketplace, that, indeed, you have
    actually scripted and constrained the marketplace, in terms of
    competition. And I am concerned about that.
        I--you know, I know I'm just, you know, your average
    consumer. And so I live in Prince George's County, but
    sometimes I shop in Montgomery County. And other times I drive
    over to get a book in Northern Virginia. And I know my car
    doesn't make a distinction about where it is in the
    metropolitan area. And so I don't understand why GSA does. And
    if you can't explain why it does, and you can't find anything
    in your history that explains why it does, then we need to get
    rid of the disparity, don't you think?
        Mr. Peck. Let me make one point to clarify. But, in
    general, I think there are--one, I have to say you're no longer
    a lay person; I think you know as much about the real estate
    market as anyone, given what you've learned--the way you've
    delved into this.
        There are clearly different rental rates in different parts
    of the metropolitan area. In fact, I mean, one of the ironies
    of the program rates is one could argue there should be 50
    program rates, because there are probably that many real estate
    sub-markets. Not every place in Washington is at $49, which is
    our program rate. There are different parts of town, different
    parts of Prince George's, that have different rates. Closer to
    a Metro station will probably pay--you will pay a higher rate
    than you will someplace else. So, that reflects the market.
        However, you accurately describe what are concerns about
    setting these rates in advance, which is that you can constrain
    competition. I believe in some cases one can make the argument
    that, while the intention was to keep us from paying a higher
    rate, in some cases, the fact that we advertise in advance what
    we're prepared to pay, in some cases may even raise the rates.
    And then there are instances in which, as you and I have
    discussed, if we actually have to go out, and someone has to
    construct a new building to meet our requirements, there are
    times, such as now, in which the program rate may not give a
    landlord enough rent to be able to finance new construction.
        And so, there are a lot of problems with this. We are
    taking a look at--and I am hoping we can have some success in--
    reforming this, so it either better does--so that it better
    reflects what a good market-based real estate strategy would
    do.
        Ms. Edwards. Well, the people of Prince George's and
    Montgomery County want to know, ``When is it our turn?'' And
    so, I know you have been looking at this for some time. These
    are questions that we have raised, and I have raised, the
    ranking member has raised repeatedly. And I think it's time to
    stop looking and to clear it up. If it doesn't exist for New
    York City, it doesn't exist for Los Angeles or Denver or St.
    Louis, then it shouldn't exist for the Washington Metropolitan
    Region.
        Thank you very much, and I yield, Mr. Chairman.
        Mr. Denham. Thank you, Ms. Edwards. Just a couple of
    follow-up questions.
        I certainly want the information about the DoT. That is
    something that came as a surprise to this committee. I
    certainly want to know whether we're using transportation
    funds, highway trust funds for buildings, instead of roads.
        As well, it came to our attention last night, when we got
    the prospectus, there is new leases in there. Could you explain
    and justify the lease request for DHS?
        Mr. Peck. Can I take a moment here?
        Mr. Denham. Sure.
        Mr. Peck. Is that a new lease request that we had not--you
    weren't aware of before? Do you know where that--what location?
        Mr. Denham. We stayed up all night going through it.
    Arizona, New York, and Texas in the new leases.
        Mr. Peck. Well, new to me, too. So I will--I understand
    it's part of an ICE collocation initiative, but I will have to
    provide you information for the record.
        Mr. Denham. Thank you. And, as well, we have had several
    discussions now--in greater detail today--on GSA's
    jurisdiction, the 1,500 properties that you oversee out of the
    1.2 million. As we are going through not only leases, which you
    have a greater percentage of, but also building investments, it
    seems like there is more that you don't know than what you know
    and control, which obviously provides some issues with this
    committee, as we are not only trying to provide valuable
    oversight in all of our procurement, but more importantly, in a
    time of crisis, we want to work to get rid of those surplus
    properties.
        If we are only looking at the 1,500, obviously, that is a
    very limited window. I understand the President's BRAC proposal
    will be coming out soon. As you know, we have also prepared our
    own BRAC bill. We look forward to working with you on both. But
    the concern that I have is that we don't have the oversight
    over all properties currently today, which leaves a huge area
    for mistake.
        Mr. Peck. Well, Mr. Chairman, we look forward to working
    with you on the legislation, too. And the intent of the
    legislation is to make--is to have jurisdiction over all of the
    properties in the United States for the purpose of making sure
    that they are still needed, and--or are available for excessing
    or surplusing out of the inventory.
        Mr. Denham. And it was at one time GSA's authority over all
    properties, wasn't it?
        Mr. Peck. Well, we still--I want to be clear. We still are
    the government's disposal agent. And so we do have something of
    a fishing license to go to other agencies and ask if their
    space is excess.
        With the President's memorandum last summer--and I think it
    would be only strengthened by legislation--we could go with a
    little bit more of a--a couple more arrows in our quiver, to
    make sure that we actually get good results.
        Mr. Denham. Thank you.
        Mr. Peck. Probably not fair to say. I shouldn't----
        Mr. Denham. Well, we are committed to working with you on
    this, as well as the administration, on their proposal. I will
    be providing you the legislation that I did on the state level.
    Our BRAC commission never moved forward in California, but we
    did consolidate all of our buyer power under GSA, which gave us
    a tremendous amount of oversight. There were a lot of
    departments that came kicking and screaming, and still would
    love to get out from under GSA, but it creates greater
    accountability, from everything from our vehicles, which we
    found thousands that were off the books, as well as properties.
        So that would be the same type of system. I would like to
    see either under a BRAC commission or separate from, but one
    way or another, we have got to get some greater accountability
    over what we own, what it's worth, the justification when we
    purchase a new property, and I think, most importantly,
    understanding the utilization rate, how many people are in each
    people, and can we do a better job.
        There are some--we understand there are some properties
    that are historic properties. The GSA building we may never get
    to a--it's one of those properties that has huge corridors and
    high ceilings, and you may never get to a current utilization
    rate. But we ought to have some type of formula for
    understanding that. And we look forward to moving forward with
    you on that.
        And before I close, I just want to reiterate. Over a month
    ago we did discuss a number of different issues which we still
    don't have clarified today. One of those, the project that Ms.
    Norton was just talking about, the Old Post Office, the RFP for
    that. We had expected to have that done by today. As well, a
    list of properties losing money on an annual basis in the
    national capital region. We did get your list of properties,
    but in that only had operating costs and not revenues.
        So, we would either like you to--have you present us a list
    of losing properties with an analysis behind those, or, at a
    minimum provide this committee with the revenue numbers so that
    we can figure it out ourselves.
        And then, finally, something that we talked about a great
    deal today, which you and I have both talked about in the past,
    is streamlining the process. We want to see a list of
    recommendations that, you know--obviously, we will work with
    our staff on recommendations on streamlining the process.
        And again, I would let you know that we do not plan on
    approving any leases. That will be the next thing that we are
    going to be working on. But we want to have this information
    first.
        Mr. Peck. Thank you, sir. We will get it to you.
        Mr. Denham. Thank you. Well, in conclusion, I would just
    like to thank you for your testimony today. Especially after
    yesterday's meetings, you know, I think that we are going to
    have a greater communication and openness. I am hopeful that
    all of the other departments that we have been having
    challenges with will not only work with you, but work with this
    committee, as well. We need some fast answers.
        I know the Administration is looking for that, as well. We
    want to work together and make sure that those answers are
    available for the public at large.
        And with that, if there are no further questions, I would
    ask unanimous consent that the record of today's hearing remain
    open until such time as our witness has provided answers to any
    questions that may be submitted to them in writing, and
    unanimous consent that, during such time as the record remains
    open, additional comments offered by individuals or groups may
    be included in the record of today's hearing.
        [No response.]
        Mr. Denham. Without objection, so ordered. I would like to
    thank our witness again for testimony today. And if no other
    Members have anything to add, this subcommittee stands
    adjourned.
        [Whereupon, at 11:52 a.m., the subcommittee was adjourned.]