Federal Personal Property: Opportunities Exist to Improve Identification of Unneeded Property for Disposal

The federal government owns billions of dollars of personal property. By law, each agency is required to follow the General Services Administration's (GSA) disposal process so that an agency's unneeded property can be used by other agencies or certain non-federal entities. GAO reviewed property management and disposal processes of five selected agencies-the Environmental Protection Agency, Forest Service, GSA, Department of Housing and Urban Development, and Internal Revenue Service-mainly based on their space reduction results and goals. In 2018, GAO reported that the five selected agencies generally did not have policies or processes for identifying unneeded personal property, such as office furniture, on a proactive basis. Executive agencies are required by law to continuously review property under their control to identify unneeded personal property and then dispose of it promptly and to have internal control activities-such as policies and procedures-for reasonable assurance of efficient operations and minimal resource waste. Without such policies or processes, agencies may not be routinely identifying unneeded property that could be used elsewhere, and efforts to maximize federal personal property use and minimize unnecessary storage costs may not be effective. Office of Management and Budget (OMB) staff and GSA officials agreed that assessing all types of property for continued need is important and called-for by internal control standards. GSA has issued regulations establishing a government-wide disposal process for unneeded personal property. However, according to GSA officials, the agency lacked the authority to promulgate regulations or formal guidance on management of in-use agency property, and there is no government-wide guidance to agencies on identifying unneeded personal property. OMB is responsible for establishing government-wide management policies and requirements and provides guidance to agencies to implement them. OMB staff stated that they could issue a notification, such as a controller alert to agencies' chief financial officers, to reinforce the statutory requirement that agencies conduct assessments of personal property for continued need. By issuing a controller alert or other guidance, OMB can help ensure that agencies are proactively taking steps to evaluate their property for continued need, including developing appropriate policies for doing so, and can thereby improve efforts to promote maximum use of excess personal property. Accordingly, GAO recommended that OMB should provide guidance to executive agencies on managing their personal property, emphasizing that agencies' policies or processes should reflect the requirement to continuously review and identify unneeded personal property. In April 2023, OMB stated that the requirements set forth in the Federal Personal Property Management Act of 2018, as well as subsequent guidance issued by GSA in response to the Act, satisfied the intent of the recommendation. Specifically, the Act required executive agencies to use GSA guidance to annually conduct an inventory and assessment of capitalized personal property to identify excess capitalized personal property under its control. It also required executive agencies to regularly conduct an inventory of accountable personal property under its control to evaluate the extent to which the property is used by the agency and the extent to which the mission of the agency is dependent on the personal property, among other factors. GSA subsequently issued guidance to agencies related to the legislation, including guidance on personal property management and inventories, which GSA published on its website and met the intent of GAO's recommendation. As a result of the legislation and the subsequent GSA guidance, agencies are better positioned to more effectively manage their personal property to ensure unneeded property is regularly identified and made available to others.