July 01, 2019 Public Contract Law Journal

The Good Neighbor Next Door: Public-Private Partnerships in Federal Real Property Management

by Makalia Griffith

Makalia Griffith is a J.D., 2019, The George Washington University Law School; B.A., 2010, M.A., 2011 Villanova University; mgriffith@law.gwu.edu. I would like to thank my Notes Editors and professors for their time and helpful comments. Special thanks to my family and loving husband Alex for their unwavering support.

I.  Introduction

Fifty-five acres of developable land positioned a few miles away from the U.S. Capitol is prime real estate, yet fifty-five acres of federally owned developable land located a few miles away from the Capitol remained barren for over 10 years.1 The land was too valuable to sell but also unsuitable for use as a traditional government site; therefore, due to its size and proximity to both public transportation and the Washington Navy Yard, the land was a good candidate for a public-private partnership designed to develop it and the surrounding neighborhood.2

Local government, community and stakeholder buy-in, and congressional approval each contributed to the redevelopment of the Washington, D.C. neighborhood, Navy Yard.3 Advocates for redevelopment attempted to persuade government employees and subcontractors to move to Navy Yard, while local government cleared blighted and vacant lots in the surrounding neighborhood.4 Through a series of federal and local government actions in the late 1990s, Navy Yard’s redevelopment was underway.5 First, the Navy Seas Systems Command (NAVSEA) Headquarters Project relocated and consolidated the NAVSEA headquarters.6 Congress, through the Southeast Federal Center Public-Private Development Act of 2000 (Public-Private Development Act), permitted the General Services Administration (GSA) to partner with the private sector to develop the empty, government-owned land.7 The Public-Private Development Act was crucial to Navy Yard’s development. More government investment into the area followed in 2004, with the decision to bring the U.S. Department of Transportation and a mixed-use development to Navy Yard.8 These investments served as catalysts for economic development.9 Now, Navy Yard, a previously undeveloped and industrial neighborhood in Washington, D.C., is on track to become one of D.C.’s most densely populated neighborhoods.10

Navy Yard’s development demonstrates that public-private partnerships can be a successful tool in federal real property management. A definition of public-private partnerships does not exist but the partnerships generally include a partnership between the government and the private sector, where a private sector partner provides a service traditionally provided by the government.11 The partnerships address two competing priorities: meeting policy goals while operating within budget constraints.12 Not only do the partnerships fill gaps in the federal budget by providing agencies with alternate methods to finance their real property needs, but the partnerships also allow GSA to be a strategic neighborhood partner.13

GSA, the agency that maintains the government’s real property portfolio, is required to fulfill its mandate while advancing local community development goals.14 GSA’s Urban Development/ Good Neighbor Program (Good Neighbor Program) strives to leverage federal space needs while simultaneously supporting community development goals.15 The program recognizes that meeting federal space requirements while engaging the local community is an efficient use of federal funds.16 As the federal government is already concerned with neighborhood development, public-private partnerships present a mutually beneficial relationship that meets the dual goals of efficiently using federal office space while engaging local communities.17

Since 2003, federal real property management has consistently appeared on the Government Accountability Office’s (GAO) high-risk list.18 Inefficient property management and waste continue to pose challenges to real property management.19 Yet, the government continues to underutilize the property it currently owns, and agencies still overwhelmingly rely on leases, when owning property would be more cost efficient in the long term.20 As the government struggles with inefficient property management and waste, this Note proposes public-private partnerships as an alternative funding mechanism and illustrates that the government can efficiently manage its real property portfolio while creating an economic benefit for the surrounding community.

This Note argues that public-private partnerships should occupy a central role in federal real property management. Public-private partnerships provide an alternate method of financing while enabling the government to meet a public policy goal. These steps would allow the government to efficiently manage its real property portfolio. Part I of this Note begins with an introduction to GSA and details the two overarching issues: (1) excess and underutilized property and (2) a reliance on leasing that impedes effective property management. Part II discusses the underlying issues that prevent the government from addressing its property management challenges. Part III discusses the federal government’s failed policy attempts and addresses the underlying reasons these policies have been unsuccessful. Finally, Part IV examines public-private partnerships and concludes that public-private partnerships can be a formidable tool in reducing the government’s real property footprint.

II.  Background: A Brief Overview of the Federal Real Property Dilemma and GSA's Role in Federal Property Management

GSA manages the federal government’s real property.21 The agency manages federal real property while striving to be a good neighbor to the communities surrounding its facilities.22 However, the agency faces unique challenges in property acquisition and disposal that its private sector counterparts do not encounter. This section will provide an overview of GSA’s role within federal real property management and discuss key issues that prevent effective property management.

A.  GSA: The Dual Role of Property Manager and Community Developer

GSA oversees federal real property acquisition, operation, and management.23 The agency maintains the government’s property portfolio, assists agencies with property disposal, and rents property to government agencies.24 GSA facilities, including office buildings and courthouses, are located in more than 2,000 communities.25 As the federal government maintains the largest real property portfolio in the UnitedStates, managing these buildings is an operational feat that costs civilian and defense agencies billions of dollars annually in maintenance and operations expenses.26

GSA also implements the provisions of the Federal Property and Administrative Services Act of 1949 (Property Act).27 The Property Act governs the use, acquisition, and disposal of federal real property and applies to all agencies, unless an agency is “specifically exempted from [the Act].”28 Some agencies maintain their own statutory authority related to real property.29 For example, the Department of Defense (DoD), United States Postal Service (USPS), and the Department of Veterans Affairs (VA) each maintain separate real estate statutory authority.30

Among other duties, GSA also administers the Federal Buildings Fund (the Fund).31 The Fund is the main source of funding for operating federal office space and has two primary objectives: (1) to provide sufficient funding for con- structing new facilities, and (2) to improve agencies’ space usage.32 The Public Building Service (PBS), GSA’s property management arm, receives funding “primarily through” the Fund.33 The Fund obtains income by rental charges assessed to federal tenants occupying federally owned and leased space.34 The financing process is as follows: GSA leases space from private-sector landlords.35 GSA then “subleases” the space to federal agencies.36 If GSA already owns the space, GSA charges its agency tenants rent rates that are comparable to rents for similar commercial space; then the rent payments are deposited into the Fund.37 Although GSA deposits tenant rents into the Fund, GSA cannot directly access revenues from the Fund and does not control the Fund’s spending.38 Fund revenue can only be used for five activities: (1) rental of space, (2) repairs and alterations, (3) construction and acquisition of facilities, (4) building operations and maintenance, and (5) installment acquisition payments.39 Instead, Congress uses the Fund’s revenues to appropriate funds to GSA.40

Despite the apparent tension between efficiently managing federal funds and community development, GSA recognizes that the agency can provide returns to taxpayers and the surrounding communities by supporting local neighborhood goals.41 GSA’s Urban Development/ Good Neighbor Program fulfills the agency’s mandate while advancing local community development goals.42 The agency strives to be a good neighbor and acknowledges that federal development can have a negative or positive effect on surrounding communities.43 For example, the surrounding community benefits when the government disposes of excess or surplus property to a private party who then develops the land.44 The new development attracts an influx of new people, who spend money in the community.45

B.  Key Issues in Effective Property Management

Two key issues impede efficient federal real property management: (1) excess and underutilized property and (2) overreliance on leasing.46 As a result of these issues, federal real property management has consistently appeared on the High-Risk list since its first appearance in 2003 when the GAO high- lighted several problems with the federal real estate portfolio.47 While federal agencies are actively working to address real property management challenges, progress is slow.

First, excess and underutilized real property remains a high-risk issue. Technological advancement and a reduced federal workforce both contribute to the government’s need to reduce office space.48 For example, some agencies now encourage employees to telecommute.49 As a result, there is an increased need to dispose of excess or underutilized property.50

Maintaining this property poses two central issues: (1) property maintenance is costly, and (2) the government suffers reputational risk by maintaining excess or underutilized property.51 The government may incur operational costs associated with maintaining the property.52 In addition to maintenance costs, the agency may incur other day-to-day costs including paying wages to staff, or security costs to secure the facility.53 As unnecessary government expenditure does not present a positive image of the government, the government should find a more beneficial use for the unneeded property to reduce reputational risk.54 This includes selling property to generate revenue or using property as a facility for another government function.55 Finally, if the property is located in a desirable location, the government harms the local economy by occupying valuable space that could be used for other purposes.56 Developing the unused real estate would benefit the surrounding communities.57

Second, reliance on “costly leasing” rather than ownership is a high-risk issue.58 Constructing or purchasing a facility is generally more cost efficient than leasing.59 Leasing, however, may be more cost efficient in short-term situations.60 Although constructing or purchasing is generally more cost efficient, GSA overwhelmingly relies on leasing to meet long term space needs.61 Through a series of reports issued between 1995 and 2013, GAO determined that for sixty-seven of eighty-nine leases, GSA could have saved almost “$1 billion if it had constructed rather than leased space for federal agencies.”62 Construction may have saved the government even more because the report only examined a small portion of GSA’s leases.63

Even more concerning is the fact that the government disproportionately acquires more long-term, high-value leases.64 In a 2013 report, GAO noted that 218 high-value leases represented around three percent of GSA’s total leases.65 Yet, when evaluated by cost and size, the 218 high-value leases represented thirty-three percent of GSA’s portfolio of leases. 66 For most high-value leases, ownership is more cost effective than leasing.67 GSA’s reliance on leased space to meet long term needs is costly and does not conserve resources that the agency could otherwise direct towards executing its mission.68

III.  Barriers to Effective Property Management

Although the government attempted to remedy these challenges through pol- icy guidance targeted at property management reform, the guidance did not target the root of the issues. As this Section will explain, any policy guidance must address the following three issues to be effective: (1) federal and local statutory requirements that hinder effective property disposal, (2) appropriations and lack of funding that constrain GSA’s budget, and (3) budget scoring requirements. The remainder of this Section will detail how these three hurdles prevent effective property management.

A. Statutory Impediments to Efficient Property Disposal

As previously mentioned, GSA disposes of all other agencies’ federal real property unless an agency is constrained by its own statutory requirement or has statutory authority to dispose of its property.69 GSA is permitted to dis- pose of surplus property by “sale, exchange, lease, permit, or transfer, for cash, credit, or other property, with or without warranty, on terms and conditions that the Administrator considers proper.”70 Some agencies, however, maintain their own “statutory authority” related to real property.71 For example, the DoD and the VA each maintain separate real estate statutory authority that permit the agencies to manage their real estate needs.72

Although GSA maintains the authority to dispose of federal real property, they cannot do it expeditiously because they are severely constrained by a legally mandated disposal process which forces them to follow a hierarchical screening process.73 As a result, the disposal process may extend longer than twenty-four months.74 First, the property is reported to GSA as excess property.75 Next, GSA offers to transfer the property to other federal agencies.76 This allows the government, if it wishes, to continue to use the property.77 If an agency accepts, the agency must pay fair market value.78 If no agency accepts, the property is deemed surplus and GSA has the authority to transfer the property to state and local governments or non-profits to be used for a public benefit.79

Before GSA can continue with the disposal process, the McKinney-Vento Act mandates that the property must first be evaluated to determine whether it can serve the homeless population.80 The McKinney-Vento Act might add up to two years to the process while the property’s suitability is determined.81 If state and local governments do not want the property, GSA can finally dispose of surplus property by a sale to the public.82 GSA’s legally mandated disposal process highlights the issues with federal property disposal and identifies competing stakeholder interests.

Other statutes influence agency real property management, further complicating real property disposal. The National Historic Preservation Act (NHPA) and the National Environmental Policy Act (NEPA) both add additional requirements to the property disposal process.83 The NHPA mandates that agencies take into account the impact of disposal on historic properties.84 Similarly, the NEPA requires federal agencies to identify and evaluate anticipated adverse environmental impacts associated with federal property disposal actions.85 These processes add additional time and may require additional approvals further prolonging the disposal process.

1.  Appropriations and Lack of Funding

Although the cost benefits of purchasing property are well documented, GSA continues to rely on leasing rather than owning real property due to lack of funding. The agency does not have the funding needed for constructing new facilities or completing major alterations or renovations of existing facilities.86 The reality is that GSA has very little funding to maintain its existing buildings.87 Lack of funding correlates to an increased reliance on leased space and directly increases the demand for leasing.88 It is, therefore, not surprising that GSA continues to rely on leasing rather than owning, although owning would save long term costs.

GSA obtains funding for new projects through the annual appropriations process; however, this process creates unintended consequences that force GSA to rely on leasing rather than owning. The Anti-Deficiency Act extends the mandate of the Appropriations Clause by prohibiting any withdrawal or obligation of funds without appropriations by Congress.89 Government agencies are prohibited from spending money or entering into a contract that would obligate the government to spend, unless there is a congressional appropriation or a statutory exemption.90

As appropriations are usually made on an annual cycle, annual appropriations may impose difficulties if a contract extends beyond one year.91 Specifically, as it may take more than one year to construct a new facility, the appropriations process is likely to impact construction contracts. Although Congress may approve and fully fund the cost of a project upfront, limited resources may prevent full upfront funding.92 Due to the challenges obtaining upfront funding through appropriations, agencies increasingly rely on leased space.93 However, the leasing process is rarely affected as GSA is authorized to enter leases for up to 20 years.94 It may appear more prudent for GSA to enter into a lease for under 20 years than to construct an entire building due to the difficulties obtaining funding.

2.   Federal Buildings Fund Allocation

Federal Buildings Fund allocation also contributes to GSA’s reliance on leasing. As previously mentioned, GSA administers the Fund, which obtains its primary source of income through rent collected from agency tenants.95 Congress then relies on the estimates to determine amounts to appropriate to GSA.96 The Fund’s troubles are two-fold. First, while the Fund’s balance has increased, Congress has refused to allocate money to upkeep.97 On the other hand, due to declining rent revenues, and rising operational costs, the Fund has limited future income.98

The Fund’s income is limited by three issues: (1) an imbalance between revenue from leasing space and the cost to maintain that space, (2) underperforming assets, and (3) a reliance on leasing.99 These issues work together to trap GSA in an unbreakable cycle that concludes with a reliance on leasing. GSA-owned assets generate most of its revenues.100 GSA uses income generated by rents charged to agency tenants occupying GSA-owned inventory for capital improvements.101 However, revenue from these assets are no longer sufficient as revenues decline due to rising operational costs.102 A GSA report noted that the issues of “inflation in utilities, maintenance and administrative costs” each contributed to rising operational costs.103 So, while revenues decline, maintenance costs have increased.104

Additionally, some GSA-owned assets operate at a loss.105 This is attributable to a few factors. First, GSA may maintain a building that is either temporarily or permanently vacant because of its significance to the community or disposal costs.106 Second, buildings undergoing a renovation will not generate income while being renovated.107 Finally, GSA now leases more space than it owns.108 As a result, lease payments to private sector landlords have increased while amounts available to fund repairs have decreased.109

Although the Fund maintains capital that could be allocated for purchase and upkeep, Congress has consistently refused to allocate sufficient funds.110 Without congressional appropriations, GSA cannot spend any revenue from the Fund.111 For example, the Fund’s balance grew from 56 million in 2007 to 2.2 billion in 2012.112 This is primarily because Congress has allocated fewer funds than those requested by GSA or generated by the Fund.113 Officials noted that if GSA were permitted to spend all the funds generated by the Fund, they could complete repairs, alterations, and provide a “modest new construction program.”114 The impact of less congressional obligation is that repairs, alterations, and construction are placed on the back burner in favor of more pressing obligations such as lease payments, operations, and maintenance.115 The effect of deferred maintenance is costly, as “each $1 in deferred maintenance results in a long-term capital liability of $4 to $5. . . ”116

While Congress has allocated fewer funds than those requested by GSA or generated by the Fund, GSA has consistently requested less money than avail- able in the Fund, in part because GSA works with the Office of Management and Budget (OMB) to discuss the budgetary needs of other federal agencies before preparing a budget request.117 Thus, GSA’s budget requests consider other agencies’ competing needs, further minimizing the likelihood that GSA will obtain the funding needed to construct new buildings.118

3.  Budget Scorekeeping Limitations

Budget scorekeeping requirements further prevent GSA from obtaining necessary funding. Budget scorekeeping, or measuring the budgetary or fiscal effects of legislation, requires GSA and other federal agencies to comply with preset rules when leasing property.119 The requirements create a state of “compliance” where, although leasing may be more expensive, it appears to be more cost effective.120 When an agency contracts or leases property, the rules are used to determine the amount “recognized in the budget.”121

Scorekeeping rules differ between purchases, capital leases, and operating leases.122 For purchases and capital leases, the full cost of the project is recorded in the budget in the year the funds are made available.123 However, operating leases differ.124 Only the amount “needed to cover the first year’s lease payments plus cancellation costs” are recorded.125 The result of this criteria is that an operating lease may appear to be more cost effective than constructing a new office because the budget will require recording less money.126 While budget scoring rules were designed to ensure that Congress spends wisely, the rules have the opposite effect in that the requirements force agencies to rely on short-term operating leases to meet long-term requirements.127

IV.   Failed Policy Attempts: Why Do the Issues Remain?

As mentioned previously, several laws and regulations specify and govern the acquisition, management, and disposal of federal real property. Compliance and implementation of these laws and regulations complicate efficient real property management.128 This section briefly outlines the government’s failed policy initiatives and highlights the various reasons the initiatives were unsuccessful.

A.  Consolidation, Co-location, and Disposal

To remedy its real property management challenges, the government undertook policies designed to freeze or reduce the footprint through consolidating agency offices, co-locating federal agencies, and disposing of unneeded office space.129 The OMB, in a 2012 memo, directed agencies to freeze their real property footprint.130 The “Freeze the Footprint” policy mandated that agencies freeze or not increase their real estate.131 The guidance named “consolidation, co-location, or disposal” as ways to offset space increases.132

In March 2015, OMB issued two policy guidance memos aimed at assisting agencies to manage their real property. First, the OMB issued the National Strategy for the Efficient Use of Real Property.133 The plan again identified consolidation, co-location, and disposal to reduce the size of the federal real property.134 The agency also simultaneously released its Reduce the Footprint policy in March of 2015.135 The plan directed agencies to reduce the real property portfolios over the span of five years by reducing excess and underutilized real property and directed agencies to maximize office space.136

B.  Failure to Address the Issues’ Roots: Statutory Restrictions, Budget Scoring Rules, Stakeholder Conflict

Ultimately, these policy initiatives were unsuccessful. First, they do not address the statutory restrictions that are imposed on GSA.137 These requirements make the process more complex and impose a lengthy and burdensome disposal process. As previously mentioned, in addition to McKinney-Vento, GSA also has to comply with statutory requirements regarding historical preservation and environmental regulations.138 Agencies note that the disposal requirements impede excess property disposal.139 Because the requirements are set in statute, agencies are compelled to follow the process. While the agency follows the statutorily mandated process it then incurs the cost to maintain the property.140 For example, while the Department of Energy felt that certain properties might be best suited for demolition due to the location, condition, or other factors, the agency was forced to undergo the screening process while paying maintenance costs.141

Next, the policies neither address budget scoring rules nor target the budgetary restrictions that GSA faces. In fact, the Freeze the Footprint initiative forced the government to extend many leases rather than acquire new property.142 While the government is not acquiring new space, it is not efficiently managing its current space needs.143

The policies also do not address disposal costs that hinder efficient property disposal. For example, agencies may face demolition costs that exceed the short-term costs of maintaining the property.144 Agencies may also need to complete repairs to a property before disposal.145 From a short-term perspective, maintaining the property appears to be the most effective use of resources.146 Environmental regulations impose another cost on agencies as agencies need to determine whether there are any environmentally hazardous issues associated.147 The weakness in property disposal has left the government holding a large amount of unneeded property which costs millions to maintain.148 Finally, the policy initiatives do not address stakeholder conflict which impedes the disposal process. Stakeholders, including local and state governments, surrounding communities, businesses, private sector construction, and leasing firms and historic preservation organizations have an interest in property disposal.149 The conflict between these groups impedes the disposal process and may not bring about the most cost-effective decision about the property.150 Stakeholder concerns often affect the budget, scope and schedule of a project.151 For example, the VA reported that disposal “is often not an option” because the community wants to maintain a relationship with the VA.152 This is a trend as several other government agencies have reported that disposal is unlikely because of community pushback.153 Ultimately, the policy guidance did nothing to address the factors which can prevent an agency from disposing of excess property.

1.  Recent Policy Developments

Two recent policies provide an opportunity to address the government’s real property management challenges as they attempt to expedite the disposal process and direct the government to determine whether public-private partnerships can be a successful tool in real property management. While the policies are a step in the right direction, public-private partnerships offer a more comprehensive solution.

The Federal Assets Sale and Transfer Act (FASTA) passed in January 2016 to encourage agencies to reduce the number of excess and unutilized properties.154 First, the bill creates a board, the Public Buildings Reform Board, to identify properties with the potential to be sold on the open market with- out the traditional disposal process.155 The bill also streamlines the disposal process and provides the government with a faster mechanism for property disposal.156 It is not surprising that FASTA garnered bi-partisan support as it allows the GSA to reduce the property portfolio through accelerated sales.157 If fully realized, the bill has the potential to tackle one policy deficiency, GSA’s arduous disposal process. Although many have high hopes for the bill, the bill does not address other deficiencies in property management.

The Federal Property Management Reform Act of 2016 (Reform Act) intends to increase efficiency in federal property management.158 The Reform Act recognizes that overreliance on leasing costs millions annually.159 The Reform Act is important because, among other factors, it is designed to “develop a strategy to reduce the reliance of Federal agencies on leased space for long-term needs if ownership would be less costly.”160 Additionally, the measure directs research towards using public-private partnerships to manage federal real property.161 This Note presents public-private partnerships as a strategy to improve real property management and details the benefits of public-private partnerships.

V.  Bridging the Gap: The Case for Public-Private Partnerships in Federal Real Property Management

Funding uncertainty negatively impacts GSA’s ability to effectively create a long-term strategy for real property management. The mismatch between managing GSA’s growing inventory of excess property while operating within budget constraints creates a financing gap, which leaves GSA unable to effectively accomplish the organization’s mission. Public-private partnerships are an alternate financing approach to bridge GSA’s financing gap and achieve its Good Neighbor policy.

A.  Federal Law Is Silent on Public-Private Partnerships

Because no federal statute authorizing public-private partnerships exists, it may be unclear whether an agency maintains the legal authority to enter into a public-private partnership.162 However, as long as the agency maintains general authority to carry out the partnership’s underlying activity and that activity advances the agency’s mission, an agency does not need explicit statutory authority to enter into the partnership.163 For example, an agency that maintains its own statutory authority to enter into leases may rely on that authority to enter into a public-private partnership where the public partner leases the building to the private partner, who completes building maintenance.164 Further, legislation may grant a federal agency blanket permission to enter into a public-private partnership.165 For example, the NHPA authorizes federal agencies to lease or exchange a government-owned historic property if the lease or exchange will ensure historic preservation.166

Although agencies can enter public-private partnerships, agencies must still abide by their authorizing statutes and budget scoring requirements.167 Therefore, depending on the activity the partnership undertakes, further congressional authorization may be required.168 This creates an absurd situation where although the agency has its own statutory authority to enter into the partnership, and statutory authority to complete the transaction, budget scoring requirements may prevent the partnership. GSA’s recent failed attempt at a partnership to acquire a new FBI headquarters highlights this situation.169 Through its authority to enter into a public-private partnership called a swap-exchange, GSA attempted to enter into a partnership to acquire a new building.170 GSA would swap the old FBI building to a private developer who would then use the proceeds from the sale to construct a new building.171 The developer could not take possession of the old building until the new building was complete.172 Unfortunately, this approach did not conform to budget scoring requirements as the cost of the project would be recorded entirely in the first year and GSA could not proceed without full appropriation to cover the difference between what developers were offering and the cost of the building.173

Under another option, GSA would use its “outlease-leaseback” authority.174 The developer would build the FBI building on federally owned land and then lease the new building back to the FBI when the developer recovered the cost of construction.175 The developer would then “transfer ownership” to the government.176 This option also conflicted with budget scoring rules because, although GSA has legislative authority to enter into the transaction, further congressional authority was necessary to exempt the transaction from budget scoring requirements and have the project scored over the term of the project.177 This case exemplifies the impact of budget scoring requirements.

Public-private partnerships serve as an alternate funding mechanism that can provide GSA with alternatives to upfront federal funding. If employed, the partnerships can bridge GSA’s funding gap. Alternate funding mechanisms allow an agency to creatively obtain capital without obtaining upfront funding through the appropriations process.178 GSA maintains the authority to use alternative funding mechanisms.179 However, all agencies do not.180 For example, GSA has property exchange authority and out-lease authority.181 As the FBI’s search for new headquarters demonstrates, GSA is increasingly looking to alternative funding mechanisms to complete projects in the face of dwindling federal funding.182 Therefore, opportunities to work with the private sector, such as private-public partnerships, are a practical solution to bridge the financing gap and provide financing for real property management.

B.  Public-Private Partnerships Allow GSA to Become a Good Neighbor

Public-private partnerships seamlessly integrate with GSA’s Good Neighbor program by providing additional financing that the government is unable to obtain.183 Efficient property management has broader implications for the communities surrounding government-owned property.184 First, public- private partnerships allow GSA to generate financing to maintain its existing portfolio or acquire new assets.185 Through public sector financing, GSA can develop property and provide significant returns to the private sector partner and the surrounding communities. Public-private partnerships can reduce both party’s development costs.186 Because public partners can streamline the approval process, this can save capital as the private partner does not incur costly development preparation, which then allows GSA to award leases and renovate or locate facilities in desired neighborhoods.187 Although GSA recognizes that where it locates its building or awards leases can have an impact on the character of the neighborhood, the agency does not have the budget to construct new facilities. 188

Anecdotally, residents believe that locating federal office space in their neighborhoods will stimulate economic growth.189 This assertion is generally correct.190 In 1999, using data from the cities of Athens, Baltimore, and Springfield, GSA commissioned a study that focused on the economic impact of federal facilities in a Central Business District (CBD).191 Further, the study found that people who visit the area because of the federal agency also make a purchase in that area.192 For example, in Athens, more than 20 percent of people visiting the agency made purchases and almost half made purchases as well in Baltimore and Springfield.193 This finding suggests that as a result of the influx of people visiting the agency, more money is spent in the community. The study overwhelmingly supported the premise that the presence of federal agencies aids the local economy.194 The study suggests that purchases from federal workers and those who visit federal agencies have a positive impact on the district’s economy.195 Directly, businesses pay rent to the landlords and taxes to the city on purchases made by the individuals within the district.196 Indirectly the employees pay income tax or pay for parking or for public transportation.197 As the federal government is already concerned with neighborhood development, public-private partnerships assist in achieving that goal.

Second, GSA can address external stakeholder concerns about design and integrates with the character of the neighborhood.198 Further, community stakeholders may lobby their governments to support policies that allow the partnership to be created.199 GAO noted that in a study of six successful public-private partnerships, each partnership received local community and other stakeholder support.200 As previously mentioned, external stakeholder support can be a challenge in efficiently managing real property.201 Therefore, GSA should use the partnerships as an opportunity to include external stakeholders.

C.  Unique Structuring in Public-Private Partnerships

As no overarching legislation governs public-private partnerships, parties are free to structure the partnership to meet their underlying needs.202 Each party brings different expertise, experience, and resources to the table. Public-private partnerships are “considered most appropriate where excess capacity exists within the asset and where existing government facilities do not adequately satisfy the current or potential future needs.”203 Therefore, federal real property management is ideally situated to take advantage of public-private partnerships as the partnerships can be structured to use private-sector capital to redevelop federal property.204 GSA can also rely on private-sector expertise to structure complicated transactions within its statutory constraints.205 As GSA only uses public-private partnerships in less than ten transactions per year, GSA should look to public-private partnerships to dispose of unneeded property, maintain its existing portfolio, and circumvent budgetary challenges.206

GSA can better manage its real property portfolio and achieve its Good Neighbor mandate if allowed greater flexibility in structuring its disposal process. As the government does not have the necessary expertise to structure transactions, partnerships with the public sector provide the agency with flexibility to structure the transaction. First, public-private partnerships can eliminate statutory restraints that are costly and impede disposal.207 Here, an agency, through a public-private partnership can bypass the McKinney-Vento Act by transferring title of the property directly to the private sector in exchange for construction of a new asset or construction or renovation at a community development through public-private partnerships. Private-sector partners can integrate modern, innovative building designs with efficient construction and assuage external stakeholder concerns. For example, com- munity members who are worried about maintaining the building’s aesthetic may become a sponsor of a project if a private partner creates a design that different location.208 Through this process, GSA is not required to follow its statutorily mandated disposal process.209

The agency can also shift environmental cleanup costs to the purchaser.210 For example, as a condition of sale, the government can mandate that the purchaser complete certain requirements.211 Finally, the partnerships allow an agency to retain title to a property while a tenant private party manages the property for a specific period of time.212 In this case, while ownership does not transfer to the tenant, maintenance costs transfer to the tenant, saving the agency money.213 Public-private partnerships allow GSA to circumvent the arduous and costly disposal process.

Navy Yard’s redevelopment is directly traceable to the flexibility Congress provided GSA through the Public-Private Development Act in disposing of the unused land.214 Not only did the Public-Private Development Act allow the government to find a more productive use for the land, but it also cur- tailed the waste of fifty-five acres of unused land that would otherwise be left empty for decades and developed it at no taxpayer costs.215 Congress provided GSA with flexibility at every level of structuring the property disposal.216 First, Congress authorized GSA to enter into agreements to lease, sell, or exchange property with a private entity.217 The Public Private Act authorized GSA to enter into various partnership agreements with private entities to develop vacant property owned by GSA.218 Therefore, GSA was not solely limited to one method of disposal and retained broad contracting authority to structure the transaction.

Next, the Public Private Act did not require the government to maintain possession of the land after the project was completed.219 This was an opportunity to adopt a flexible approach in structuring the transaction.220 Finally, the Act did not consider McKinney-Vento or give preference to a public use requirement.221 Bypassing these provisions allowed GSA to streamline and accelerate the disposal process.222 This was significant because although the authority was limited to a specific instance, GSA previously did not have the authority to allow private development on public lands.223

To be clear, an agency’s flexibility in structuring transactions is not the sole determinant of a successful project. Other considerations such as timing, assessing the value of a property, and political buy-in can derail projects.224 Some critics maintain that while public-private partnerships appear to be the least expensive way for agencies to obtain capital, upfront funding is the most cost effective long-term option.225 This concern emphasizes that purchases by the government will always be the cheapest option. However, it is highly unlikely that GSA will obtain upfront funding to complete more expensive projects.226

In fact, this inability to obtain funding for long term projects is the driving cause for GSA to engage in more partnerships with the public sector. Although partnerships financed by the private sector will be more expensive than those financed by the government due to the government’s cheaper rate for borrowing, GSA can obtain the funding it needs to complete capital asset construction through partnerships with the private sector. The fact remains that under current budget constraints, GSA cannot obtain the funds it needs.227 Instead, public-private partnerships allow the federal government to acquire the funds needed to efficiently manage its real property portfolio while benefiting the surrounding community.

VI.  Conclusion

The solution that this Note proposes would allow the federal government to remedy its real property management challenges while simultaneously allowing GSA to achieve its legally mandated community engagement goal. Public-private partnerships provide the federal government with a formidable ally and alternate solution to manage its real property management needs. This solution allows the private sector to provide capital to assist the government with alternate methods to finance its real property needs. To be clear, this approach recognizes that there will always be challenges when two separate entities come together to create a partnership. Nevertheless, the positive results of these partnerships outweigh any challenges. Partnerships between the federal government and the private sector will allow GSA to be a better community neighbor while reducing the cost of federal real estate management.

Entity:
Topic:
  1. See Roger K. Lewis, Acres of Opportunity at the Southeast Federal Center, Wash. Post at 1 (Feb. 10, 2001), https://www.washingtonpost.com/archive/realestate/2001/02/10/acres-of-opportunity-at-the-southeast-federal-center/4eff7e82-851a-4102-a4f5-7d1df71ea53e/?utm_term=.1cf93ca75d0e [https://perma.cc/MA4W-6QJJ]. The land, previously used for constructing weapons and ships, was designated as a Superfund hazardous-waste site by the Environmental Protection Agency. See Vernon Loeb, EPA Orders Cleanup of Navy Yard, Wash. Post at 1 (Jan. 12, 1997), https://www.washingtonpost.com/archive/local/1997/01/12/epa-orders-cleanup-of-navy-yard/559593af-1dc4-429a-8280-f5b581c2b19e/?noredirect=on&utm_term=.c8aaf9aee87e [https://perma.cc/WX42-CNUS]. As a result, the government began the process of cleaning any contaminated soil prior to disposition. See id.
  2. See Vernon Loeb, Seeking a Better View on the D.C. Waterfront, Wash. Post at 2 (Mar. 8, 1998), https://www.washingtonpost.com/archive/local/1998/03/08/seeking-a-better-view-on-the-dc-waterfront/086ef452-4129-453c-a255-0acf0cf20506/?utm_term=.8d60cdcdaa23 [https://perma.cc/PUV6-RARE] [hereinafter Loeb]; see also Lewis, supra note 1, at 3–4.
  3. See Loeb, supra note 2, at 4. The Washington, D.C. neighborhood, Navy Yard, is also known as Near Southeast or Capitol River Waterfront.
  4. See id. at 2.
  5. See Benjamin Freed, How Navy Yard Built Up One of DC’s Fastest-Growing Neighborhoods, Washingtonian at 2 (Sept. 18, 2013), https://www.washingtonian.com/2013/09/18/how-navy-yard-built-up-one-of-dcs-fastest-growing-neighborhoods [https://perma.cc/7DB5-2DA7].
  6. See id.
  7. See Southeast Federal Center Public-Private Development Act of 2000, Pub. L. No. 106-407, § 3, 114 Stat. 1758 (2000).
  8. See Freed, supra note 5, at 3.
  9. See id.
  10. See Sadie Dingfelder, Navy Yard on Track to Be D.C.’s Most Densely Populated Neighborhood, Wash. Post at 1–2 (Jan. 8, 2016), https://www.washingtonpost.com/express/wp/2016/01/08/navy-yard-on-track-to-be-d-c-s-most-densely-populated-neighborhood/?utm_term=.94f66cb647cf [https://perma.cc/6KNC-EDMB].
  11. See Alissa Ardito, Administrative Conference of the United States: Public-Private Partnerships 6–7 (2016) (detailing prevailing legal and policy issues in public private partnerships) (citations omitted).
  12. See Garrett Hatch & Kate M. Manuel, Cong. Research Serv., R43337, Public-Private Partnerships for Purposes of Federal Real Property Management 4–5 (Dec. 12, 2013) [hereinafter Public-Private Partnerships] (providing an overview of policy and legal issues affecting public-private partnerships in real federal property management) (citations omitted).
  13. See id.
  14. See Urban Development/Good Neighbor Program, GSA (last visited Mar. 31, 2019) https://www.gsa.gov/real-estate/design-construction/urban-development-good-neighbor-program [https://perma.cc/8SY4-JR6N] [hereinafter Urban Development/Good Neighbor Program].
  15. See id.
  16. See id.
  17. See id.
  18. See U.S. Gov’t Accountability Off., GAO-03-122, High Risk Series: Federal Real Property 2 (2003) [hereinafter GAO-03-122].
  19. See Urban Development/Good Neighbor Program, supra note 14.
  20. See U.S. Gov’t Accountability Off., GAO-17-317, High Risk Series: Progress on Many High-Risk Areas, While Substantial Efforts Needed on Others 86 (2017) [hereinafter GAO-17-317].
  21. See 40 U.S.C. § 541 (2012).
  22. See Urban Development/Good Neighbor Program, supra note 14.
  23. See Real Property Policy Division Overview, GSA, https://www.gsa.gov/policy-regulations/policy/real-property-policy-division-overview , (last visited Mar. 31, 2019).
  24. See id.
  25. See Urban Development/Good Neighbor Program, supra note 14.
  26. See GAO-17-317, supra note 20, at 77 (citation omitted). The government’s portfolio includes approximately 273,000 buildings that are either leased or owned throughout the United States. See id. Real property is defined as “facilities; land; and anything constructed on, growing on, or attached to land.” GAO-03-122, supra note 18, at 4.
  27. See GAO-03-122, supra note 18, at 7 (citation omitted).
  28. Id.; see Garrett Hatch et al., Cong. Research Serv., R43818, Overview of Federal Real Property Disposal Requirements & Procedures 2 (Dec. 10, 2014) [hereinafter Overview of Federal Real Property Disposal] (providing an overview of real property disposition and highlighting GSA’s role) (citations omitted).
  29. See Overview of Federal Real Property Disposal, supra note 28; GAO-03-122, supra note 18, at 7 (citations omitted).
  30. See GAO-03-122, supra note 18, at 7 (citations omitted).
  31. See 40 U.S.C. § 592 (2012).
  32. See U.S. Gov’t Accountability Off., PLRD-82-18, GSA’s Federal Buildings Fund Fails to Meet Primary Objectives i (1981); Stephanie Smith, Cong. Research Serv., RL33774, Federal Buildings Funding Limitations and Their Implications CRS-1 (Mar. 21, 2008) (citations omitted).
  33. Public Buildings Service, GSA (last visited Mar. 31, 2019) https://www.gsa.gov/about-us/organization/public-buildings-service [https://perma.cc/K74P-DA34]. PBS maintains a vast inventory of government real property and owns, leases, or maintains workspace for 1.1 million federal employees. See id.; U.S. Gov’t Accountability. Off., GAO-12-646, Federal Buildings Fund: Improved Transparency And Long-Term Plan Needed To Clarify Capital Funding Priorities 3 (2012) [hereinafter GAO-12-646] (detailing the issues with the administration of the Federal Buildings Funds and the effect of these issues on federal property management) (citations omitted).
  34. See GAO-12-646, supra note 33. GSA also charges agencies a fee of 7%, in addition to rent, to cover its operational costs. See id.; Smith, supra note 32.
  35. See GAO-12-646, supra note 33.
  36. See id.
  37. See id.
  38. See Smith, supra note 32, at CRS-2.
  39. See GAO-12-646, supra note 33, at 4.
  40. See id.
  41. See Urban Development/Good Neighbor Program, supra note 14.
  42. See id. The federal government is engaged in many socio-economic policies. These policies raise a controversy because there is a tradeoff between collateral objectives, those that are good for society and achieving a cost-efficient value for the federal funds. For more information on the policies that require GSA to advance local community development goals, see generally Exec. Order No. 12,072, 3 C.F.R. § 213 (1979); Exec. Order No. 13,006, 3 C.F.R. § 195 (1996).
  43. See Urban Development/Good Neighbor Program, supra note 14.
  44. See Denise Turner Roth, How Communities Can Unlock the Value of Federal Property, Voices of the Governing Institute 2–3 (Sept. 5, 2017), http://www.governing.com/gov-institute/voices/col-cities-federal-property-general-services-administration-development.html.
  45. See id.
  46. See GAO-17-317, supra note 20, at 77.
  47. See U.S. Gov’t Accountability Off., GAO-03-119, High Risk Series: An Update 24 (2003). The High-Risk Report is released every two years by the GAO and identifies areas that pose challenges to the U.S. government and affect an agency’s ability to meet its mission. See id.
  48. See GAO 03-122, supra note 18, at 8.
  49. See U.S. Gov’t Accountability Off., GAO-13-744, Federal Real Property: Greater Transparency And Strategic Focus Needed For High-Value GSA Leases 33–34 (2013) [hereinafter GAO-13-744].
  50. See GAO-03-122, supra note 18, at 8. Excess and underutilized property refers to property that the government maintains that is unnecessary or buildings that could be put to more cost-efficient uses.
  51. See id. at 11 (citations omitted).
  52. See id.
  53. See id.
  54. See id.
  55. See id.
  56. See GAO-03-122, supra note 18, at 11.
  57. See Roth, supra note 44.
  58. See GAO 03-122, supra note 18, at 30. The government generally has four choices when addressing its space requirements. See id. The government can construct, purchase, lease, or some combination of the construction, lease, and purchase arrangement. See id. Lease purchases are a combination of a leasing arrangement with an option to purchase the facility at or before the termination of the lease. See id. The agreements are less expensive than ordinary leasing but are more expensive than purchasing. See id.
  59. See GAO-13-744, supra note 49, at 5–6 (citation omitted).
  60. See id.
  61. See GAO-03-122, supra note 18, at 30.
  62. See id. at 1 (citations omitted).
  63. See id.
  64. See id. at 9. A high-value lease is a lease that requires GSA to pay a “net annual rent” above a threshold. See GAO-13-744, supra note 49, at 2. GSA is required to submit a prospectus to the House and Senate authorizing committees for review and approval before entering these leases. See id.
  65. See id. at 9.
  66. See id.
  67. See id. at 19.
  68. See Office Of Mgmt. & Budget, Exec. Office of the President, National Strategy For The Efficient Use Of Real Property: Reducing The Federal Portfolio through Improved Space Utilization, Consolidation, And Disposal 2 (2015) [hereinafter National Strategy].
  69. See 40 U.S.C. § 541 (giving GSA the authority to dispose of surplus property); id. § 543 (describing permissible disposition methods).
  70. Id. § 543.
  71. See Overview of Federal Real Property Disposal, supra note 28.
  72. See id. at 2 n.7.
  73. See id. at 2–5 (citations omitted).
  74. See Public-Private Partnerships, supra note 12, at 4.
  75. See Overview of Federal Real Property Disposal, supra note 28. GSA then hires a licensed appraiser to determine the property’s fair market value. Id.
  76. See id. This provides other federal agencies with the first opportunity to acquire the excess property. See id.
  77. See id.
  78. See id. at 3 (citation omitted).
  79. See Overview of Federal Real Property Disposal, supra note 28, at 3 (citations omitted). Here, GSA can offer the property at 100% discount of fair market value. See id.
  80. See id. at 4.
  81. See Public-Private Partnerships, supra note 12, at 4; U.S. Gov’t Accountability Off., GAO-14-739, Federal Real Property: More Useful Information To Providers Could Improve The Homeless Assistance Program 4–5 (2014).
  82. See Overview of Federal Real Property Disposal, supra note 28, at 4–5. The agency has two options when disposing the property to the government. GSA can either enter a negotiated sale to a public entity, either a state or local government if the building will be used for a public purpose. See id. at 4. Conversely, GSA can dispose of the property through a public sale to the general public by a sealed or public auction. See id. at 5. The sale price through a public sale may never be less than fair market value. See id.
  83. See id. at 10–12 (citations omitted); see also 54 U.S.C. § 306108 (Supp. V 2014) (requiring the government to “take into account the effect of the undertaking on any historic property.”); 42 U.S.C. § 4321 (2012) (requiring the federal government to “promote efforts which will prevent or eliminate damage to the environment and biosphere and stimulate the health and welfare of man”).
  84. See 54 U.S.C. § 306108.
  85. See 42 U.S.C. § 4321.
  86. See U.S. Gov’t Accountability Off., GAO-14-239, Capital Financing: Alternative Approaches To Budgeting For Federal Real Property 16 (2014) [hereinafter GAO-14-239] (citation omitted).
  87. See id.
  88. See id. at 13 (citation omitted). In fact, the agency acquired only one new property, Columbia Plaza, located in Washington, D.C., through a purchase option in its contract, between 2008 and 2012. See id. at 13–14. Columbia Plaza houses the Department of State. See id.
  89. See U.S. Const. art. I, § 9, cl. 7.
  90. See 31 U.S.C. § 1341 (2012).
  91. See id.
  92. See GAO-14-239, supra note 86, at 6–7 (citation omitted). Agencies determine how to meet real property needs through the capital planning process. See id. at 6. First, the agency will prepare a business case and determine whether to request upfront funding from Congress through the annual appropriations process. See id. Next, the agency requests funding. See id. Congress will then decide whether to approve the project and appropriate the full amount of funding upfront. See id. Then, when the agency receives the funding, it obligates funds for the project and the agency completes the project. See id. at 6–7.
  93. See GAO-14-239, supra note 86, at 9–10.
  94. See 40 U.S.C. § 585 (2012).
  95. See Smith, supra note 32.
  96. See id. at CRS-2.
  97. See GAO-12-646, supra note 33, at 9–10.
  98. See id.
  99. See id. at 7.
  100. See id.
  101. See id. at 4.
  102. See id. at 9–10.
  103. GAO-12-646, supra note 33, at 10.
  104. See id. at 9–10.
  105. See id. at 10.
  106. See id. at 11. For example, if a tenant agency leaves the building permanently, it may be cheaper to operate at a loss than dispose of the property. See id.
  107. See id.
  108. See GAO-12-646, supra note 33, at 14.
  109. See id. at 12–13.
  110. See id. at 5–6.
  111. See id. at 4.
  112. See id. at 5.
  113. See id. at 5–6.
  114. GAO-12-646, supra note 33, at 6.
  115. See id. at 6–7.
  116. Id. at 20 (citation omitted).
  117. See id. at 7.
  118. See id.
  119. See GAO-14-239, supra note 86, at 8; see also Office of Mgmt. & Budget, Exec. Office of the President, Circular No. A-11, Preparation, Submission, and Execution of the Budget 21-1 (2017) (explaining the federal budget process and federal budget scoring).
  120. See GAO-14-239, supra note 86, at 10; U.S. Gov’t Accountability Off., GAO-03-1011, Budget Issues: Alternative Approaches to Finance Federal Capital 2–5 (2003) [hereinafter GAO 03-1011].
  121. GAO-14-239, supra note 86, at 7.
  122. See id. at 7–10.
  123. See id. at 8.
  124. See id.
  125. Id.
  126. See id. at 8–10.
  127. See GAO-14-239, supra note 86, at 9–10.
  128. See Garrett Hatch, Cong. Research Serv., R42646, Disposal of Unneeded Federal Buildings: Legislative Proposals in the 112th Congress 2 (Aug. 6, 2012) [hereinafter Disposal of Unneeded Federal Buildings] (citations omitted).
  129. See Memorandum from Office of Mgmt. & Budget on Promoting Efficient Spending to Support Agency Operations to Heads of Exec. Dep’ts & Agencies 5 (May 11, 2012) [hereinafter Promoting Efficient Spending] (on file with the White House).
  130. See id.
  131. See id.
  132. Id.
  133. See generally National Strategy, supra note 68, at 1.
  134. See id.
  135. See generally Memorandum from Office of Mgmt. & Budget on Implementation of OMB Memorandum M-12-12 Section 3: Reduce the Footprint to All CFO ACT Exec. Agencies 1 (Mar. 25, 2015) (on file with the White House).
  136. See id.
  137. See Disposal of Unneeded Federal Buildings, supra note 128.
  138. See id.
  139. See id.
  140. See id.
  141. See id.
  142. See Promoting Efficient Spending, supra note 129.
  143. See Disposal of Unneeded Federal Buildings, supra note 128.
  144. See id. at 2–3 (citation omitted).
  145. See id. at 2.
  146. See id. at 2–3.
  147. See id. at 3.
  148. See id. at 1.
  149. See U.S. Gov’t Accountability Off., GAO-07-349, Federal Real Property: Progress Made Toward Addressing Problems, but Underlying Obstacles Continue to Hamper Reform 38 (2007) [hereinafter GAO-07-349].
  150. See id.
  151. See id.
  152. Id.
  153. See id.
  154. Federal Assets Sale and Transfer Act of 2016, Pub. L. No. 114-287, § 2, 130 Stat. 1463 (2016).
  155. See id. §§ 4, 11.
  156. See id. § 2.
  157. See id.; Niki Deininger & Andy Winkler, Trump Can Help Property Disposal Move a Little FASTA, Bipartisan Policy Center (Aug. 6, 2018), https://bipartisanpolicy.org/blog/trump-can-help-property-disposal-move-a-little-fasta/ [https://perma.cc/M5X5-BHRF].
  158. Federal Property Management Reform Act of 2016, Pub. L. No. 114-318, § 2, 130 Stat. 1608 (2016).
  159. See generally id.
  160. Id. § 623.
  161. See id.
  162. See Public-Private Partnerships, supra note 12, at 9.
  163. See Ardito, supra note 11, at 16.
  164. See Public-Private Partnerships, supra note 12, at 9–10 (citations omitted).
  165. See id. at 11 (citation omitted).
  166. See id.
  167. See Ardito, supra note 11, at 16 (citation omitted).
  168. See id.
  169. See Dorothy Robyn & Steve Sorett, Budgetary Scoring Rules Are To Blame For FBI HQ Setback, LAW360 2 (Aug. 8, 2017), https://www.law360.com/articles/952009/budgetary-scoring-rules-are-to-blame-for-fbi-hq-setback [PERMA] [hereinafter Robyn & Sorett] (explaining how budget scoring requirements are the real culprit behind the failed swap attempt); Meredith Somers, GSA, FBI Agree to Provide ‘Workable Solution’ for Future HQ Project, Fed. News Network 2 (Aug 2. 2017), https://federalnewsradio.com/facilities-construction/2017/08/gsa-fbi-agree-to-provide-workable-solution-for-future-hq-project/ [https://perma.cc/Q447-W458].
  170. See Robyn & Sorett, supra note 169; GAO-03-1011, supra note 120, at 6.
  171. See Robyn & Sorett, supra note 169.
  172. See id.
  173. See id.
  174. See id.
  175. See id.
  176. See id.
  177. See id.
  178. See GAO-03-1011, supra note 120, at 2. However, due to statutory authority, some government agencies cannot use alternative financing. SeeSee GAO-14-239, supra note 86, at 1. Congress, however, maintains authority to allow an agency to use an alternate funding mechanism. See id. The authority to use these sources may come from either permanent statutory authority or within an annual appropriations act. See GAO-03-1011, supra note 120, at 2–3; GAO-14-239, supra note 86, at 1.
  179. See GAO-14-239, supra note 86, at 1.
  180. See id.
  181. See Consolidated Appropriations Act, 2005, Pub. L. No. 108-447, § 412, 118 Stat. 3259 (2004). These mechanisms allow GSA to generate alternate funding. See id. For example, under the Consolidated Appropriations Act, GSA was granted authority beyond its existing authority. See id.
  182. See Robyn & Sorett, supra note 169.
  183. See generally Public-Private Partnerships, supra note 12.
  184. See generally Daniel Rojo, Can Federal Offices Change Neighborhoods for the Better?, Greater Greater Wash. (Mar. 30, 2012), https://ggwash.org/view/12709/can-federal-offices-change-neighborhoods-for-the-better [https://perma.cc/C2JG-KGP7].
  185. See generally Public-Private Partnerships, supra note 12.
  186. See John Stainback, Public/Private Finance And Development: Methodology/Deal Structuring/Developer Solicitation 14 (2000).
  187. See id. at 28.
  188. See Urban Development/Good Neighbor Program, supra note 14.
  189. See Rojo, supra note 184.
  190. See Roth, supra note 44.
  191. See Nat’l Main St. Ctr., Measuring The Economic Impact Of Federal Facilities On Central Business Districts 5 (2002) [hereinafter Measuring The Economic Impact]. A CBD is the commercial center of the city.
  192. See id. at 17.
  193. See id.
  194. See id. at 31–32.
  195. See id.
  196. See id.
  197. See id. at 31–32.
  198. See U.S. Gov’t Accountability Off., GAO-99-23, Public-Private Partnerships: Key Elements Of Federal Building And Facility Partnerships 4-5 (1999).
  199. See id. at 15–16.
  200. See id. at 4.
  201. See GAO-07-349, supra note 149.
  202. See Ardito, supra note 11, at 16.
  203. GAO-03-1011, supra note 120, at 47.
  204. See id.
  205. See id.
  206. See U.S. Gov’t Accountability Off., GAO-16-776R, Federal Real Property: Public-Private Partnerships Have a Limited Role in Disposal and Management of Unneeded Property 5 (2016) [hereinafter GAO-16-776R]. Over the last ten years, GSA has entered into various public-private partnerships that used alternate financing methods to tackle real property needs. See id.
  207. See Disposal of Unneeded Federal Buildings, supra note 128.
  208. See GAO-16-776R, supra note 206, at 6 (citations omitted).
  209. See id.
  210. See id.
  211. See id.
  212. See id at 5.
  213. See id.
  214. Southeast Federal Center Public-Private Development Act of 2000, § 3.
  215. See Loeb, supra note 2, at 2–3.
  216. Southeast Federal Center Public-Private Development Act of 2000, § 3.
  217. See id.
  218. See id.
  219. See id.
  220. See id.
  221. See id.
  222. See Southeast Federal Center Public-Private Development Act of 2000, § 3.
  223. See 146 Cong. Rec. 22,975 (2000).
  224. See GAO-16-776R, supra note 206, at 8–9 (citations omitted).
  225. See GAO-14-239, supra note 86, at 18; GAO-03-1011, supra note 120, at 2.
  226. See GAO-03-1011, supra note 120, at 2–3.
  227. See id.