GSA shutters plans for FBI HQ amid $882 million funding gap

The long, long search for a new Federal Bureau of Investigation headquarters is finally at its end. Not because the government has settled on one of the three sites in the running, but because the General Services Administration has decided to cancel the project altogether.

GSA announced Tuesday the cancellation of the FBI headquarters consolidation project, citing a nearly $1 billion funding gap.

“GSA and FBI previously have stated that full funding is crucial for the government to make a contract award,” a GSA spokesperson said. “The fiscal year 2017 budget request included $1.4 billion for this project; however, the $523 million appropriated in 2017 leaves an $882 million funding gap. Moving forward without full funding puts the government at risk for cost escalations and the potential reduction in value of the J. Edgar Hoover property that developers were to receive as part of this procurement.”

News of the cancellation was first reported by the Washington Post and the Washington Business Journal.

An FBI spokesperson referred questions about the cancellation to GSA.

The federal government’s decision leaves no clear path toward replacing the J. Edgar Hoover building, the crumbling Pennsylvania Avenue edifice that senior FBI leaders have been lobbying to permanently evacuate for more than a decade over concerns about its physical integrity, inability to effectively house a modern workforce and concerns about vulnerability to terrorist attack.

In a statement from Sens. Ben Cardin and Chris Van Hollen, and Reps. Steny Hoyer and Anthony G. Brown (all D-Md.), the lawmakers said cancelling the requests for proposals “puts America’s national security at risk.”

“Our national security mandates that we move forward with building a secure, fully consolidated FBI headquarters,” the group said. “We strongly disagree with this decision. If the Trump Administration is unwilling to reconsider its position, then we urge GSA to move forward as quickly as possible by selecting one of the other various financing mechanisms identified and thoroughly examined by GSA. Team Maryland, including our federal delegation, state and local officials, will continue to work together to ensure the fully consolidated FBI headquarters project comes to fruition.”

A final selection for a new headquarters had already been delayed several times because of hesitation on Capitol Hill about the overall project’s price tag. The Obama administration had proposed to partially defray the costs by trading the downtown Washington real estate upon which the Hoover building now sits to the same developer chosen to build the new facility, but the government’s share was still estimated to be well north of $1 billion at any of the potential construction sites.

After having winnowed the field to three developers’ proposals — one each in Springfield, Virginia; Greenbelt, Maryland; and Landover, Maryland — GSA postponed a final award late last year and again in March because appropriators had not yet allocated the funding needed to begin the initial stages of the project, including the environmental reviews needed to prepare the new site for construction. And in what may have been a foreshadowing of today’s news, the Trump administration did not include any funds for the new FBI project in its 2018 budget proposal.

During budget hearings in May, the House Appropriations Financial Services and General Government Subcommittee’s ranking member Rep. Mike Quigley (D-Ill.), said he was “disappointed and perplexed” that the Trump administration’s request didn’t include more funding to begin the acquisition and construction of a new consolidated FBI headquarters.

Rep. Tom Graves (R-Ga.), who also sits on the House’s appropriations committee, recognized the budgetary shortfalls for the agency, and in late June described the cuts as “merely a math issue” to acting GSA Administrator Tim Horne.

But lawmakers representing the D.C. region had hoped that the funding impasse had been yet another bump in the road for the project, and seemed to be caught off-guard by the news that the administration was abandoning it altogether.

Rep. Gerry Connolly (D-Va.) said he had not been aware of GSA’s decision to end the competition before it was publicly reported on Monday evening.

“I think GSA’s got a lot of ground to cover in restoring its own credibility with the private sector,” Connolly said in an interview with Federal News Radio. “For a complicated, turnkey operation such as this I think serious developers are going to really be reluctant to participate, because look at what happened here; a number of private sector entities and local jurisdictions put billions of dollars into the redevelopment and planning, responding to bids, responding to specs, changing the terms of reference. Millions of dollars and all of that’s not been sedated, and I couldn’t blame anyone in the private sector for looking askance at future GSA bids.”

Connolly said the cancellation will have an impact on the regional economy, but more importantly, the FBI’s mission will be impacted by the decision.

When the Hoover building was built in the early 1960s, the FBI’s mission was quite different from its mission today, Connolly said. Organized crime and counterespionage  were the big parts of the mission, compared to the challenges of counterterrorism, cybersecurity and human trafficking today.

“They do need a new headquarters that fits today’s mission, to say nothing of the fact that the building itself was in decrepit condition,” Connolly said. “This is really a major embarrassment to the nation’s capital, but ultimately the driver here should be what does the premier law enforcement agency of the United States government need in order to function with the 21st century challenges we face. There’s a criticality to that mission that should not be lost in this decision, and that’s why whatever happens next better happen swiftly, and with a real sense of mission attached to it because we can’t wait another decade.”

GSA said in its statement that the cancellation did not lessen the need for a new FBI headquarters, and it would continue to work with the FBI to address space requirements.

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