Like a deeply indebted city slicker inheriting grandga's farm, the Reagan administration is hoping to reap a one-time bonanza be selling off surplus federal property handed down to it from previous administrations.
Prompted by the personal attention of President Reagan and a recent public mention by presidential counselor Edwin Meese III, the idea has been elevated from the Office of Management and Budget to a special White House working group, that now is analyzing its money-raising potential, an official at OMB said.
Surplus properties in the Washington area range from a prime block of the downtown to a lighthouse on the Patuxent River.
There are even those who dream of finding enough money buried in excess lands to wipe out the entire federal budget deficit, which is on its way to reaching $100 billion. The American Society of Appraisers, a private group, for example, has estimated that there are hundreds of billions of dollars in surplus government properties of all kinds across the country.
But all this exuberant calculating leaves the man in charge of selling the excess federal properties scratching his head.
"I've been reading figures on how many bucks could be generated, how much could be disposed of," said Earl Jones, assistant commissioner at the General Services Administration's office of real property. "Some of them, well, I don't know where they get these figures."
The government owns 775 million acres--one third of the United States. About 95 percent of this are public domain lands such as parks and forests administered by the departments of Interior and Agriculture. The other 5 percent is property acquired for a specific purpose, most of it for military installations, which the GSA administers. That 5 percent, 65 million acres acquired for a total cost of $8.8 billion, is the part being looked at most closely for possible surpluses that could be sold.
A look at a dozen surplus properties in the Washington area over the past six months, when the government took its last complete inventory, gives a clue about the potential for such properties. There clearly are veins of gold to be mined in the unused land. At the same time, much of the value to the federal government now exists only on paper because so often the property is merely transferred to other federal agencies or given away.
Among the dozen parcels, one in Beltsville was bought for $2,000 was sold for $354,200, while two other pieces have not received bids high enough to accept. Three stayed in the federal government family, three were given to state or local governments, one is still having its price negotiated, and another has not yet been disposed.
The GSA's Jones declined to speculate on the true money-making potential of unneeded federal property, but pointed out that the disposition currently is netting only about $50 million a year. To reach the appraiser group's $100 billion figure, a program would have to generate 2,000 times that much. Last June's inventory of properties in GSA's jurisdiction identified $1.3 billion in excess and surplus lands, but this is merely their acquisition cost and so in many cases in greatly undervalued.
Part of the reason the net is so small, compared with what is available, is that when property is declared excess by one department or agency it is first offered to other government agencies and then to state and local governments for parks and recreational facilities, fish and wildlife refuges, airports or other uses. When it goes to the state or local governments for public purposes or if it is given to a nonprofit organization, it is free to them. The Reagan administration wants to change that policy, however, hoping to sell the land rather than giving it away.
Under the current program, here is what happened to a dozen properties here:
The most valuable piece of property in this area that the federal government wants to sell is one square block of prime land between D and E and Third and Fourth streets NW, facing Judiciary Square. Its acquisition cost in 1968 was $3.465 million. GSA advertised for bids but didn't find the high offer of $8.5 million acceptable, so the land is being used as a parking lot until bids are requested again.
The government also has declared 107.22 acres of land at Fort Belvoir in Fairfax County as excess property but hasn't disposed of it yet. On the government's books, its acquisition cost is listed as $8,000, the amount the government paid for it in 1918-19.
GSA wants to sell what it calls the Wilburn Family Housing Annex at Bolling Air Force Base, including seven acres of land and two buildings, which the government acquired for $64,000. It didn't get an adequate bid on this property, either. In 1977 developer William Cafritz bought 11 acres of the Wilburn tract nearby, intending to build houses on it. Cafritz now reports that he sold off some of the land to another developer who has built 50 houses there. Cafritz is holding onto another part of the tract but doesn't anticipate doing anything with it until interest rates come down.
The government did better with 5.3 acres of land at the Beltsville Agricultural Research Center, which was valued at its acquisition cost of $2,000 but sold for $354,200.
There were 1.58 acres of land at the Naval Research Laboratory at Calvert County with no appraised value that sold for $7,600.
The city of Alexandria wants to buy 1.15 acres of prime land one block from the river in Old Town that is being used as a parking lot. It has offered more than $900,000 for the land, 10 times what the federal government paid for it, but GSA is holding out for more. The agency is getting a new appraisal and plans to open negotiations with the city again in early February, a GSA spokesman said.
The seven acres and one building at the Curtis Bay Storage Depot in Ann Arundel County that cost $135,000 is being transferred to the Army.
A Navy parking lot in Arlington, including 16.47 acres that cost $283,000, went through some technical change of hands but continues to be intended for Navy use.
Less than an acre of land at Arlington Hall Station on Rte. 50 was declared excess and the county was given permission to build a fire station on it. But the county didn't come up with the funds for it so the land has been returned to the Army.
At the Center for the Handicapped in Beltsville, 5.6 acres of land that cost $2,000 are to be transferred to Maryland for use as a park.
The NATC Point Lookout Light Station on the Patuxent River is going to the state of Maryland for a park.
Half an acre of land and a building at the Manassas Air Force Station is being deeded to Prince William County in Virginia for use as a school.
Clearly the listed value of the government's property is far too low in many if not most cases. The appraisers society estimates that current market value in many cases is 50 to 100 times what is listed on the government's books. In addition, the government listed 546 parcels around the country as excess or surplus, but the appraisers believe there may be five to 10 times that many that could be found.
The administation hopes to encourage agencies to voluntarily turn over property they aren't using but is hanging onto rather than reduce their empires. And, instead of using the money from the sales of these lands for parks, the White House would use it to reduce the deficit. "Something is likely to show up in the budget" on the idea, though whether it could be implemented for fiscal 1983 is unclear, an OMB spokesman said.
"The nation's priorities are being rearranged," said Jones at the GSA. "During the Nixon era, there was a push for parks and recreation and that sort of thing. But we're in different times, and there is a different look at total national priorities."
For the time, the 95 percent of federally owned property that are public domain lands appear to be immune.
"We don't need to get into the James Watt question," said a staff aide on a Senate Government Affairs subcommittee, referring to the controversial secretary of the Interior. "There are substantial amounts of acquired land that isn't being used without getting knee-deep into that controversy."
Sen. Charles Percy (R-Ill.) and Rep. Larry Winn (R-Kan.) have proposed that more surplus acquired lands be identified and appraised and then sold. They also have urged that Congress change the law so that the funds will be used to reduce the national debt, rather than going directly into the land and water conservation fund.
Selling the nation's parks and forests would be more difficult, technically as well as politically. The Federal Land Policy and Management Act of 1976 established retention and management of public lands as a national policy, and Congress would have to reverse this law to start a large-scale disposal program, according to a spokesman for the Bureau of Land Management. In addition, these lands already net large amounts of money--$11.2 billion last year--in leases and fees for oil, minerals, forest and grazing rights, said BLM spokesman James W. (Tim) Monroe.
The appraisers' group isn't tackling the nation's parks, either. Dexter MacBride, ASA executive office in Washington, said there currently is a "strong academic series of discussions"--including within the administration--on the idea of turning some of these lands over to the private sector.
But this idea goes too far to MacBride's way of thinking: "I just can't see Marriott running the Grand Canyon."