Better late than never, they say.
Thirty-five years after the General Services Administration was formed by an act of Congress and given the task of managing the nation's federal office buildings, its bureaucrats have decided to develop a system to determine if those buildings are money makers or money losers.
By the end of fiscal 1985, all government-owned and federally leased office buildings in GSA's inventory will have two-page "income and expense analysis" statements comparing revenue from the federal-agency occupants with the cost of running the building.
The statements will give GSA building managers and supervisors essential data such as how much rent is collected from tenant agencies and how much it costs to clean, fuel, maintain and repair the building.
The data will be broken down into in-house and contract costs and a cost-per-square-foot figure, giving the reader a quick comparison with any other building in the agency.
"This represents a simple and common-sense approach," said GSA Public Buildings Commissioner Lester L. Mitchell in written comments that were prepared for The Washington Post.
"For each building, the cost of every PBS Public Buildings Service program is pulled together in a single report. When used with PBS' other new management efforts, this will assure efficient operations and enough revenue to protect and perpetuate our nation's investment in real estate."
Government-owned buildings "earn" GSA money under a 1973 law that requires all agencies to pay for the space they use, at an estimated fair-market value. The money is commingled with revenue from agencies paying for space in leased buildings.
In leased buildings, GSA may be paying a landlord $10 a square foot for office space under a long-term lease but charging an agency $20 a square foot, because the appraised fair-market value of that space has gone up over the years.
All revenue becomes part of the Federal Building Fund, which is used to pay for rent, cleaning, maintenance, heating and cooling.
In addition, the funds are used -- with congressional approval -- for repair and alteration work and for new construction.
GSA tested the use of the new "income and expense analysis" statements in 88 buildings over the past year, including nine in the Washington area. Among the findings: In Kansas City, a GSA-run building occupied by the Food and Drug Administration scored high in utility costs compared with other buildings. GSA officials were able to reduce the temperature of heated water from 160 to 140 degrees and reduce heating in a parking garage from the 70s last winter. As a result, GSA officials claim, utility costs were cut by 5 percent. In a Carbondale, Ill., federal building, GSA found that it was not receiving any revenue from parking spaces that were supposed to be revenue earners. As a result, GSA is now collecting $10,000 a year from agencies for the parking lot, helping the building's profitability. In GSA's regional office building in Washington,there were 52,000 square feet of vacant space, which made the building unprofitable because it did not generate any revenue, the statement pointed out. Now, several agencies have been moved into some of the space, and a portion was leased out to the private sector.
Mitchell said that the new approach to financial management "makes it possible, for the first time, to compare revenues and expenses by building and by region. This allows each region to be considered a 'profit center' and analyzed by not only how much it spends but by how much revenue it brings in."
"Our hope is to have a system whereby the people who are closest to the buildings, the buildings' managers, watch the data in the 'income and expense analysis' statements for blips," said Ira Jekowsky, assistant commissioner of PBS for policy and program support. He emphasized, however, that building managers have up to 20 other reports to monitor to make sure costs are kept to a minimum to deliver the services necessary to the tenant agencies.
"What's a crying shame is that the Public Buildings Service has resisted putting this in place for years," said Raymond A. Fontaine, GSA's outspoken comptroller, referring to the agency in the 1970s. "We developed this over here in 1978 . A guy on my staff did it. Then we found ourselves beating our heads up against a brick wall over there for years trying to get it implemented."
The Buildings Service eventually adopted the program in 1982, and now Jekowsky and a Fontaine aide, Larry J. Eisenhart, deputy director of finance, are working jointly to implement it.
The linchpin of the new idea remains the buildings managers, generally employes who have worked their way up the blue collar ranks to managerial positions. GSA officials have complained privately that new developments in technology, including energy savings systems, never were properly explained to buildings managers. In a sense, the new "income and expense analysis" statements are a way to put more facts into their hands.
"It is going to take a lot of training, we realize that, and not all of our buildings managers are going to find it easy to deal with," said GSA's Jekowsky.
"There's always a myth that we cannot incorporate ideas from the private sector into the public sector," said Alex P. Lucus, a senior GSA buildings manager who works in what the agency calls the "Mall" field office. His unit includes such buildings as the headquarters for the Energy, Housing and Urban Development and Health and Human Services departments.
"Tenants always beat us over the head complaining that they pay and pay and pay for services that they never receive," he said. "This will give us a way of making sure that they're not paying too much and a way to show them that they are getting something for their money."
Before the statements were developed, Lucus said, "I never knew what we were paying for certain types of services unless I conducted a research project to find out. It shouldn't be that way."