The General Services Administration's Rental Rates (Standard Level User Charges) for Federal Agencies

Gao ID: LCD-78-329 May 25, 1978

P.L. 92-313 authorized the General Services Administration (GSA) to charge agencies rental fees for GSA-controlled space. These charges are known as standard level user charges (SLUC). The law states that rentals should approximate commercial charges but does not contain guidance for computing the rates.

GSA has used market surveys and quality ratings to determine approximate commercial rates for individual buildings. For fiscal year (FY) 1978, GSA adopted the method of fair annual rental (FAR) rates which is based on independent appraisals of buildings. Each year, GSA reappraises one-third of its inventory, about 3,500 buildings, at an average cost of $140 per appraisal. The FAR system, plus billing improvements, have reduced agency complaints about rates. Annual SLUC billings have grown from $952.3 million for FY 1975 to $1,383.7 million for FY 1979. GSA charges the Social Security Administration and the Railroad Retirement Board only for actual operating costs and alterations. At the direction of the Office of Management and Budget (OMB), a dual system was devised to offer discounts for long term occupancy. This reduced the income from SLUC by about 20%. Reductions in SLUC collections also resulted from other actions of OMB, the Congress, and GSA.

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