Joyce Remarks at Hearing on GAO's Assessment of the Costs of Deferred Maintenance Across the Federal Government

The Government Accountability Office, or GAO, said it best when they described the federal government as quote - “one of the world’s largest and most complex entities.” 

I have said for years that we do a lot of talking in DC about how much we owe – and rightfully so, with the national debt continuing to climb – but we do not do a good job of talking about what we own. The U.S. government needs a clear balance sheet to fully understand both our costs and our assets, and I am hopeful that GAO can assist in that process. 

To help Congress and the executive branch manage the federal government’s operations, GAO created a High-Risk List. This list, which is updated every two years, identifies areas that are ripe for waste, fraud, abuse, and mismanagement, or areas that need to be fundamentally overhauled. 

Disturbingly, the maintenance of federal properties went on this list in 2003 and has not come off in 22 years. 

The issue of deferred maintenance plays heavily into this problem.

The federal real estate portfolio is significant. There are more than 285,000 buildings and structures with a replacement value of $1.2 trillion.  Over the last several years, deferred maintenance in the federal real property portfolio has ballooned. For example, in FY 2020, GSA’s deferred maintenance and repair costs were $2.53 billion. In FY 2024, GSA’s estimated deferred maintenance and repair costs increased to $6.1 billion. 

GSA is not unique in this. The National Archives and Records Administration, or N-A-R-A, owns and maintains real property assets independently of GSA. NARA’s FY2024 financials suggest that it also has significant deferred maintenance. And in testimony before Congress, former Postmaster General DeJoy stated in 2020, when he took office, the US Postal Service had 31,000 facilities in “horrible condition” with more than $20 billion in deferred maintenance liabilities.

As we look at the causes of deferred maintenance liabilities, they are not just about more funding. Inflation and the cost of building and repair supplies can increase the overall costs. Building age is another factor. The median age for buildings within GSA’s portfolio is 51 years.  As assets age, they typically require more maintenance and repair. For example, by the time an asset reaches 30 years, it may require replacement of windows, wiring, pipes, and air conditioning units.

We need to understand this problem and think carefully about ways that we can address this issue in a cost-effective manner both in the short term and long term. 

This includes ensuring that agencies are taking care of the properties under their control. Proper oversight of maintenance contractors and ensuring they keep up with the basic maintenance of the properties in their possession can ensure that small problems do not become big problems.

Finally, as we think about solutions, we need to be forward leaning. While selling properties is a great way to decrease the deferred maintenance backlog, we need to keep cost reduction and mission requirements at the center of the decision process. 

We should ensure that the federal government properly analyzes the cost of its real property decisions to ensure that it is making choices to dispose, replace, or repair properties in ways that reduce long term costs while ensuring that federal agencies retain the facilities and resources required to conduct their missions effectively. 

I look forward to our discussion today.