Management of Overseas Real Property

Many GAO audit reports have spotlighted the effect of management failures in the federal government--waste, inefficiency, and even scandal. Political leaders have been forced to spend too much time reacting to surprises like the Department of Housing and Urban Development debacle rather than doing the work the agencies were created to do. GAO began its high-risk program to identify those high-dollar government programs most vulnerable to fraud, waste, abuse, and mismanagement. This report is part of the program's high-risk series of reports, which examine the federal government's efforts to identify and correct problems in 17 especially vulnerable areas, fall into three main categories: lending and insuring, contracting, and accountability. Many of the root causes of the problems afflicting these government programs are traceable to the absence of fundamental processes and systems. GAO urges that future congressional oversight focus on the agency reports and audited financial statements required by the Chief Financial Officers Act, agency management's progress in correcting material weaknesses in program internal control and accounting systems, and federal agency efforts to develop and implement performance standards. The Comptroller General summarized the high-risk series in testimony before Congress; see: Government Management--Report on 17 High-Risk Areas, by Charles A. Bowsher, Comptroller General of the United States, before the Senate Committee on Governmental Affairs. GAO/T-OCG-93-2, Jan. 8, 1993 (22 pages).

GAO found that: (1) unapproved overseas facility construction, over-standard housing for foreign-based U.S. employees, insufficient maintenance requirements, and questionable real estate acquisition and disposal decisions contributed to program waste and mismanagement; (2) the FBO $2.1-billion security construction program lacked clear program objectives, planning, and coordination which resulted in significant delays and cost overruns; (3) internal control weaknesses in FBO property management included inadequate overseas post oversight, inadequate financial information systems, insufficient funding for facility rehabilitation and maintenance, and poor integration and planning of foreign policy and security objectives; (4) FBO completed only 8 of the 57 projects under the security construction program, failed to adequately assess contractor performance, and lacked sufficient staff to manage overseas facility construction; and (5) FBO needs to establish focused priorities for overseas construction projects, enhance and increase contractor evaluations, hire additional qualified staff to survey maintenance conditions at foreign posts, require yearly maintenance inspections, streamline and update housing standards, and improve information systems.