Press Releases

Graves & Pence Statements from Hearing on GSA Outleases & the Old Post Office Hotel

Washington, D.C., January 28, 2020 | Justin Harclerode (202) 225-9446 | comments
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Opening remarks, as prepared, of Committee on Transportation and Infrastructure Ranking Member Sam Graves (R-MO) and U.S. Rep. Greg Pence (R-IN) from today’s Subcommittee on Economic Development, Public Buildings, and Emergency Management hearing entitled, “GSA Outleases and the Trump Old Post Office Hotel”:

Committee on Transportation and Infrastructure Ranking Member Sam Graves (R-MO):
Normally, when we invite the head of an agency to testify, it’s to discuss critical issues facing the agency.  But, today we have called the Administrator to focus primarily on one project – the Old Post Office – and outleases generally, which  account for less than one percent of all that GSA manages.

Under Administrator Murphy’s leadership, GSA has saved Federal agencies and the taxpayer more than $7 billion in FY2019.  GSA has closed the deal on the purchase of the DOT Headquarters building, is managing major renovations at land ports of entry, and GSA’s role in helping to implement the Federal Assets Sale and Transfer Act will save billions by selling and redeveloping underused federal assets.

This is our second hearing on the Old Post Office – a project directed by Congress through Democratic legislation and awarded and negotiated under a Democratic President.  It is unfortunate that the desire to impeach this President runs so deep that even issues related to public buildings have become partisan.

We may from time to time disagree on projects or priorities, but ultimately, our goals have been the same – to ensure GSA was a good steward of the taxpayer dollar. 

There are important issues that we should be asking the GSA Administrator about today.  GSA has more than 50% of its leases expiring in the next 5 years, there is a backlog of construction and repair projects, and there are ongoing security issues at federal facilities.  We should be focused on working with GSA on addressing those and other issues.

While GSA is trying to deal with expiring leases and backlogs in repair projects, GSA has also had to juggle what seems to be never-ending document requests.  After thousands of documents produced and offers by GSA to make accommodations for the Committee to review requested financial records for the OPO, the Democrats still accuse GSA of obstruction.  And for what?  Because the Democrats claim the lease may violate the Emoluments Clause – an unsettled area of law which should be sorted out through the courts not by us here in Congress.

Let’s get back to real work.  With all the time and effort put into investigating this one lease, we could have worked together to develop solutions to some of the critical issues facing management of our public buildings and other infrastructure.  I hope today we can talk about some of those other pressing issues and the good work the Administrator has been doing since coming on board.

U.S. Rep. Greg Pence (R-IN):
GSA has accomplished a lot in recent years – across its portfolio, GSA saved federal agencies $7 billion just in fiscal year 2019 alone.  The DOT headquarters purchase will realize significant savings over the long term.  And, GSA was a part of the team to help stand up the Public Building Reform Board pursuant to the Federal Assets Sale and Transfer Act (FASTA) which will realize billions of dollars in savings in the sales of unneeded federal property.

But, once again, instead of focusing on critical issues like those I mentioned or our crumbling infrastructure, we are here today focusing on bashing the President.  We have other business before this subcommittee that is critical to the American taxpayer, including issues that fall under the purview of the GSA Administrator. 

For instance, Ranking Member Meadows and I introduced legislation that would give GSA some of the tools needed to address the avalanche of expiring leases.  We spend over $5 billion a year on leasing space.  We should be focused on what we can do to ensure these leases are replaced with good deals and reduce the costs.

We also have bills pending before this subcommittee to pilot the use of public-private partnerships to help address the backlog of GSA projects.  We should be focused on solutions to address the backlog of GSA’s capital projects, so we are not forced to resort to leasing because we cannot afford to do anything else.

The Federal Protective Service (FPS) is responsible for securing GSA’s facilities.  There is a reorganization happening right now involving FPS.  But, instead of focusing on how this reorganization may be impacting the security of people working and visiting federal buildings, we are holding our second hearing related to the Old Post Office.

Office of Management and Budget just approved the first round of high value properties to be sold under historic and bipartisan legislation this committee drafted – the Federal Asset Sale and Transfer Act (FASTA).  But, instead of focusing on that, we are questioning a project that turned a money-losing asset into a money-making asset for the taxpayer.

GSA, along with other agencies, had facilities damaged in many of the disasters that happened across the country in recent years.  Where are they in fixing and repairing them?  Why is that not a focus today?

And, instead of ensuring all GSA employees are focused on these and other critical issues, many of the GSA employees have had to spend their time responding to the Majority’s document requests which can best be described as a partisan fishing expedition.

Let’s be clear – GSA has produced over 10,000 pages of documents in response to Democratic requests – over 30,000 if you include the FBI Headquarters project document requests.  Despite GSA providing rolling document productions, following our hearing in September, the Chair felt compelled to issue a subpoena.In response, GSA offered this committee an opportunity to go to GSA and review the financial records submitted for the Old Post Office for oversight purposes.

This committee has had a long-standing, bipartisan respect for the sensitivity of certain information, such as procurement sensitive and proprietary business information.  We know this information, if disseminated, can harm the interests of the taxpayer, as it would result in lower competition and increased costs because of the higher risk of doing business with the government.

I agree we have to be able to conduct our oversight, and as I stated earlier, GSA has invited this committee to view the financial records for those purposes.  But the Majority would not take up GSA on that offer because the Committee could not agree to one simple term – to not publicly disclose any of the private financial information contained in those documents.  This only confirms what we all already know: this is not a legitimate exercise of the Committee’s oversight authority but rather an abuse of that authority to harm the President politically.

We spent our September hearing listening to witnesses argue that the current arrangement at the OPO violates the Emoluments Clause, and now that there are reports the hotel interest may be sold, that too, according to the Democrats, violates the Constitution.

Outleasing historically has not only been supported by Congress, but encouraged.  The Public Buildings Cooperative Use Act of 1976 and Section 111 of the National Historic Preservation Act were intended to encourage commercial, cultural, recreational and other activities in federal buildings.  The OPO lease itself was directed by Congress in legislation.

Are there valid issues we may want to examine with respect to outleases going forward?  Of course.  But, in the $9 billion GSA Federal Buildings Fund, outleases account for less than 0.3% of the funds.

There are many other issues we should be addressing here today, especially with the GSA Administrator joining us.  I hope today we can not only look at outleasing going forward but other critical issues related to public buildings.

Click here for more information, including witness testimony.

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