In these tough fiscal times, agencies are no longer planning for annual increases or even maintaining their budgets at the same level year-to-year. Instead, they’re looking for ways to reduce administrative costs on an continuing basis.
It’s been about 8 months since Norman Dong took the reigns as commissioner of the General Services Administration’s Public Buildings Service. He recognizes that constrained budgets are forcing agencies to take a hard look at their building costs. “That creates a heightened awareness, not just within GSA, but also with our tenant agencies to really look at how we’re spending our dollars on administrative and overhead functions, including real property,” said Dong .”And I think there’s a recognition that dollars that are spent unnecessarily on real property come at the expense of more mission-critical activities.”
Dong’s first exposure to how PBS can help agencies cut costs came when he was the chief financial officer at the Federal Emergency Management Agency.
In the fall of 2011, FEMA had just learned from the Office of Management and Budget that its budget was going to be reduced significantly and the CFO’s office was considering whether it should reduce staff or look for other administrative savings.
“For us at FEMA, it was pretty clear,” Dong said. “If we were all about helping communities to respond to and recover from disasters, we’re not in the position to be cutting staff, because our bench strength was our ability to help perform our mission.”
FEMA officials knew they were spending too much on real property, so Dong turned to PBS to come up with a plan for reducing costs.
“What they did was working with headquarters and the folks in the national capital region office, they looked at how we were using our space within FEMA and they looked at two markets,” he said. “They looked at the national capital region, where FEMA had 11 different facilities, and they also looked at Boston, where we were in some very expensive space.”
After several months of working together, PBS gave FEMA a list of recommendations that would help it co-locate, consolidate and reduce its footprint and real-property spending to the tune of about $10 million annually.
“For me personally, that was very impactful, because it allowed us to avoid having to do painful position reductions,” he said. “And, I’d actually spent some time with the FEMA administrator a few weeks ago, and he was giving us a tour of the new space. They’ve done a lot of consolidation over at 500 C St., and I’ve never seen somebody so proud of the space.”
In following PBS’ recommendations, FEMA has not only been able to consolidate multiple leases in the C Street facility, but it’s torn down walls and adopted an open office plan similar to the one GSA unveiled for its own headquarters in 2013.
The consolidation and renovation at FEMA is just one example of what PBS is trying to accomplish across government.
“That experience is probably why I’m here today,” Dong said. “Just being able to see the impact that PBS can have on agencies where it’s not just dollars and cents, but it’s also in terms of improving how we work within an agency.”
PBS is also trying to leverage its disposal, exchange and out-leasing authority to find the best use for the government’s properties.
Dong pointed to the 2013 deal GSA struck with Donald Trump’s organization to redevelop the historic Old Post Office Building in Washington as an example of finding a better use for an old property.
“A couple of years ago, that was like a food court and home for some federal agencies,” he said. “That probably wasn’t the highest and best use for that asset, and the work that the Trump organization is doing to actually renovate that building and to turn it into a hotel is probably a much more productive use of that asset.”
GSA is currently working with the FBI to relocate from its current headquarters in the J. Edgar Hoover Building to one of three locations — the Greenbelt Metro and Landover in Prince George’s County, Maryland ,or the GSA Franconia Warehouse Complex in Springfield, Virginia.
Dong said GSA expects to release in December a request for quotation or round one of its request for proposal on that project. He added that he’s pleased with the FBI partnership.
“I’ve had an opportunity to be over in the Hoover Building several times for meetings and, as you walk through that space, it really does just indicate the need for having a much more modern and open workplace that allows for us to consolidate more of the FBI activity,” he said. “You want the agency headquarters really to kind of reflect the importance of the work that they do.”