Summary: Pursuant to a congressional request, GAO reviewed the Federal Buildings Fund's (FBF) ability to finance needed capital investment in General Services Administration (GSA)-controlled federal buildings. GAO found that: (1) federal agencies' rent payments are insufficient to finance growing capital investment needs and leased space costs due to restrictions on the rent GSA can charge federal agencies; (2) FBF revenues are based on prevailing commercial rental rates rather than the projected costs of long-term capital replacement or expansion of federal buildings; (3) GSA estimates that it will need $2.3 billion annually over the next 10 years for capital investment, but FBF revenues will only average $1.6 billion annually; (4) GSA expects to increase its spending for leased space over the next 10 years and stabilize spending for new building construction and purchases; and (5) GSA expects to increase its ownership of space it controls from 55 to 65 percent, but it will have to finance 40 percent of that increase with 1990 and 1991 supplemental funding and not FBF rent receipts.
