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6
Findings and Recommendations
The committee’s task was to develop methods, strategies, and procedures to
predict outcomes anticipated from investments in federal facilities maintenance
and repair. To fulfill its task, the committee was asked to address the following
questions:
• Are there ways to predict or quantify the outcomes that can be expected
from a given level of investment in maintenance and repair of federal
facilities or facilities’ systems?
• What risks do deteriorating facilities, deteriorating building systems (such
as mechanical and electrical), or deteriorating components (such as roofs
and foundations) pose to the achievement of a federal agency’s mission or
to other organizational outcomes (for example, physical security, operating
costs, worker recruitment and retention, and healthcare costs)?
• Do such risks vary by facility type (such as offices, hospitals, industrial,
and laboratories), by system, or by function (such as research and admin-
istrative)? Can the risks be quantified?
• What strategies, measures, and data should be in place to determine the
outcomes of facilities maintenance and repair investments? How can
those strategies, measures, and data be used to improve the outcomes of
investments?
• Are there effective communication strategies that federal facilities pro-
gram managers can use to inform decision-makers better about the cost-
effectiveness of levels of investment in facilities’ maintenance and repair?
Chapters 1 through 5 provide context and address the various aspects of the
78
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FINDINGS AND RECOMMENDATIONS 79
statement of task. The present chapter extracts the key findings of the report and
presents seven recommendations for improving the outcomes of investments in
maintenance and repair of federal facilities. Chapter 7 is intended to show how
some of the recommendations could be implemented by federal facilities program
managers.
FINDINGS
Finding 1. An array of beneficial outcomes can be achieved through timely
investments in facilities maintenance and repair (Table 6.1). Those outcomes
support mission achievement, compliance with regulations, improved condi-
tion, efficient operations, and stakeholder-driven initiatives. All the outcomes
can be measured. Some outcomes including reliability and physical condition
can be predicted; that is, they can be estimated before an investment is made
or if an investment is not made.
When federal facilities program managers identify maintenance and repair
requirements, they typically include projects that focus on objectives related to a
mission, to compliance with safety and health regulations, to improving facility
condition or extending service life, to efficient operations, or to stakeholder-driven
TABLE 6.1 Beneficial Outcomes Related to Investments in Maintenance and
Repair
Mission- Compliance- Condition- Stakeholder-
Related Related Related Efficient Driven
Outcomes Outcomes Outcomes Operations Outcomes
Improved Fewer accidents Improved Less reactive, Customer
reliability and injuries condition unplanned satisfaction
maintenance and
Improved Fewer building- Reduced backlog Improved public
repair
productivity related illnesses of deferred image
maintenance and Lower operating
Functionality Fewer insurance
repairs costs
claims, lawsuits,
Efficient
and regulatory Lower life-cycle
space
violations costs
utilization
Cost avoidance
Reduced energy
use
Reduced water
use
Reduced
greenhouse gas
emissions
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80 PREDICTING OUTCOMES OF INVESTMENTS IN FEDERAL FACILITIES
requests. A wide array of beneficial outcomes can result from investments in
maintenance and repair, many of which are interrelated. All the outcomes can be
measured (as described in Chapter 7), although most of the measures are based
on data that are gathered after the fact (“lagging measures”). Some outcomes,
including reliability and physical condition (as opposed to financial condition)
can be predicted by using processes such as reliability-centered maintenance or
by using physical-condition models and indexes that calculate service life and
remaining service life. No agency should expect to track all the outcomes. Instead,
each agency will need to set priorities among the objectives and outcomes to be
achieved through investments in maintenance and repair.
Finding 2. Deteriorating facilities and systems pose risks to the federal gov-
ernment, its agencies, its workforce, and the public. Among them are risks
to the achievement of federal agencies’ missions; risks to safe, healthy, and
secure workplaces; risks to the government’s fiscal soundness; risks to efficient
and cost-effective operations; and risks to achieving public policy objectives.
Just as investments in maintenance and repair can have an array of beneficial
outcomes, the lack of investment and the deferral of needed maintenance and
repair projects can pose risks—measure of the probability and severity of adverse
events. Adverse outcomes include interruptions in or stoppages of agency opera-
tions; accidents, injuries, and illnesses; lawsuits and insurance claims; increased
operating costs; shortened service lives of equipment and components; diversion
of constrained resources to excess, obsolete, and underutilized facilities; failure
to meet public policy objectives; and damage to the federal government’s public
image.
Risks will increase as federal facilities age and as building systems and com-
ponents deteriorate through wear and tear and lack of investment in maintenance
and repair. (Risks can also be related to geography, climate, and other factors.)
Risks associated with deteriorating facilities and systems include risks to federal
agencies’ missions; to safe, healthy, and secure workplaces; to the government’s
fiscal soundness and public image; to efficient operations; and to the achievement
of public policy objectives related to energy independence and environmental
sustainability.
Finding 3. The risks associated with deteriorating facilities vary by type of
facility, by system, by existing condition, by function, by utilization, and, most
important, by the relationship of the facilities to an agency’s mission. Risks
can be identified qualitatively and some can be quantified.
The missions and programs managed by federal departments and agencies
vary widely. Such variation means that the risks associated with facilities and
components will depend on the missions that they are intended to support. For
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FINDINGS AND RECOMMENDATIONS 81
example, the risks associated with a failure in a heating, ventilation, and air-
conditioning (HVAC) system in a research laboratory or museum that has histori-
cal artifacts will be different from the risks associated with a failure in an HVAC
system in an office building.
The mission-dependency index developed by the U.S. Navy, the U.S. Coast
Guard and the National Aeronautics and Space Administration (NASA) is a
process-based index that incorporates operational risk management into facili-
ties management. A series of models and indexes developed by the U.S. Army
Corps of Engineers (USACE) Engineering Research and Development Center-
Construction Engineering Research Laboratory (ERDC-CERL) can be used to
identify and quantify the risk of failure of building components and systems and
the risk of failure of some types of infrastructure. The USACE Inland Navigation
Program is an example of a different approach that can be used to quantify risks
and link maintenance and repair activities to a mission.
Finding 4. Excess, underutilized, and obsolete facilities constitute a drain
on the federal government’s budget in costs and in forgone opportunities to
invest in the maintenance and repair of mission-supportive facilities and
to reduce energy use, water use, and greenhouse gas emissions.
Federal agencies report that they operate and maintain about 45,000 facili-
ties that have become excess with respect to their missions or are underutilized.
The total number of facilities that are technologically or otherwise obsolete is
unknown. The cost to operate, maintain, and repair excess, underutilized, and
obsolete facilities is more than $1.6 billion a year.
Private-sector organizations “have a direct incentive to dispose of unneeded
facilities because they are a drain on organizational resources and are readily
identifiable on their balance sheets” (NRC, 2004a, p. 97). Excess or underutilized
facilities are disposed of through sales, demolition, or nonrenewal or termination
of leases to free resources for other organizational requirements. In those ways,
private-sector organizations manage the risk of fiscal exposure related to the
ownerhip of facilities, reduce their maintenance and repair requirements, and
s
reduce facilities-related expenses such as property taxes and the costs of energy,
water, insurance, and security. They also manage the risk to their public image
posed by abandoned and poorly maintained facilities, which could affect the
public’s willingness to buy their products (NRC, 2004a).
Representatives of IBM and General Motors (GM) emphasized that their
organizations were unable to dispose of excess facilities effectively until the effort
was managed by a central organization charged with that responsibility and the
effort was funded to support the sale or demolition of excess facilities.
Two previous National Research Council studies, Stewardship of Federal
Facilities: A Proactive Strategy for Managing the Nation’s Public Assets (1998),
and Investments in Federal Facilities: Asset Management Strategies for the 21st
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82 PREDICTING OUTCOMES OF INVESTMENTS IN FEDERAL FACILITIES
Century (2004a), have made recommendations related to the disposal of excess
federal facilities. Intelligent Sustainment and Renewal of Department of Energy
Facilities and Infrastructure (NRC, 2004b) outlined a process for decision-making
about when to repair, replace, renovate or dispose of facilities.
If the disposal of excess properties by federal civilian agencies can be suc-
cessfully implemented, the federal government would reduce its risk of fiscal
exposure related to the ownership of buildings, reduce its total operating costs,
and reduce its long-term maintenance and repair requirements and costs. Disposal
of excess and underutilized facilities would also help to meet other public policy
objectives related to reductions in the use of energy and water, and reduction
in greenhouse gas emissions. To realize those long-term savings and benefits, a
coordinated, sustained, and funded effort will be required.
Finding 5. To manage and mitigate the risks posed by the ownership of
f
acilities, high-performance private-sector organizations do the following:
• Systematically dispose of excess and underutilized facilities.
• Pursue a proactive strategy to minimize their total facilities “footprint.”
• Link maintenance and repair activities to the organization’s business
or mission and set priorities among them.
• Correlate the effects of systems-related failures with the business or
mission.
• Correlate delays in timely maintenance and repair with sustainment
cost.
To reduce their maintenance and repair requirements, private-sector and other
high-performance organizations proactively initiate strategies to minimize their
total facilities footprint and the associated costs (such as the costs of equipment,
furniture, and landscaping). Advances in technology allow telecommuting and
other alternative work strategies that offer the potential for both public and private-
sector organizations to reduce their required amounts of office or administrative
space substantially, and reduce their overall maintenance and repair requirements.
Some federal agencies including the General Services Administration and the
Patent and Trademark Office are implementing telework strategies and reducing
their need for office space. The Telework Enhancement Act of 2010 (PL 111-292)
grants federal employees eligibility to telework and requires all federal agencies to
establish telework policies. As the policies are implemented, there will be oppor
tunities to reduce the overall federal facilities footprint further and to achieve
substantial reductions in long-term maintenance and repair requirements and a
more sustainable portfolio of federal facilities.
The primary objective of portfolio-based facilities management is to ensure
that facilities-related investments enable an organization’s mission. Private-
sector companies, such as GM and IBM, which produce vehicles and com uters, p
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FINDINGS AND RECOMMENDATIONS 83
respectively, have been able to correlate the failure to invest in maintenance and
repair with the mission of their organizations, which is to make a profit for their
o
wners and shareholders. Some federal agencies—including the USACE, the
Navy, NASA, and the Coast Guard—have also developed approaches for linking
maintenance and repair investments to mission-related operations.
When failures do occur, some companies, such as GM, conduct a “root-cause
analysis” to determine why they happened, determine the appropriate solutions,
and then share the lessons learned with the managers of other facilities that may
be at risk for similar failures. Root-cause analysis is a basic premise of reliability-
centered maintenance, which is used by many industries, and is also being used
to some degree in some federal agencies, including NASA and the Smithsonian
Institution.
Delaying maintenance and repair of facilities can shorten the service lives of
components and systems and ultimately result in an increase in sustainment cost.
Service-life models and the Integrated Multiyear Prioritization and Analysis Tool
(IMPACT) simulation model developed by ERDC-CERL can be used to quantify
the costs of delaying repairs.
Finding 6. To make the outcomes of and risks posed by investments in main-
tenance and repair projects and activities transparent to decision-makers at
all levels of the organization, facilities managers in high-performance orga-
nizations do the following:
• Aggregate maintenance and repair requirements for some facilities’
systems and components (such as life-safety systems and roofs) to pro-
vide for greater transparency and to identify operational efficiencies.
• Perform “knowledge-based” condition assessments; that is, tailor the
frequency and level of inspection to the strategic importance of facili-
ties and to the life cycle of systems and components to provide credible
estimates of repair costs and remaining service lives.
• Measure outcomes as a basis of continuous improvement.
• Implement feedback systems to evaluate the performance of investments.
Each of the private-sector organizations interviewed for this study identified
projects that must be funded within their organizations and then fund them through
sources other than the maintenance and repair account. “Must fund” projects
include ones that are required for an organization to be in compliance with govern-
ment regulations (such as regulations related to worker health and safety and air
and water quality) because the risks associated with non-compliance—substantial
fines or legal action—are much greater than the costs of the projects themselves.
To provide greater transparency in the decision-making process related to
investments in maintenance and repair, some private-sector organizations group
their maintenance and repair projects by component, such as roofs, HVAC, and
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84 PREDICTING OUTCOMES OF INVESTMENTS IN FEDERAL FACILITIES
fire protection. Grouping all the projects related to a component type makes the
benefits and risks associated with projects more transparent to senior decision-
makers. It also makes it easier for them to vet, screen, treat, and then set priorities
among the projects that should be funded first to ensure that an organization’s
profits are not adversely affected by unreliable facilities systems or components.
Condition assessments that are undertaken on a multiyear cycle and that are
conducted for an entire portfolio of facilities can be inefficient and expensive and
the information can lose its value for decision-making relatively quickly. Some
organizations are taking a “knowledge-based” approach to condition assessment.
The term knowledge-based is used “to indicate that knowledge (quantifiable
information) about a facility’s system and component inventory is used to select
the appropriate inspection type and schedule throughout a component’s life cycle.
Thus, inspections are planned and executed on the basis of knowledge, not merely
the calendar” (Uzarski et al., 2007). Because different building systems and
components have different service lives and the risks associated with the failure
of some may be greater than the risks associated with the failure of others, some
systems and components are inspected more often than others and at different
levels of detail. By tailoring the frequency and level of inspections, a knowledge-
based approach makes better use of the resources available and provides more
timely and accurate data to support investment-related decisions.
Most public-sector and private-sector organizations, including federal agen-
cies, have implemented performance measurement as a basis of continuous
improvement of facilities management and other processes. Some private-sector
organizations also conduct a year-end evaluation of budget performance. That type
of evaluation compares the “submitted budget” the “approved budget,” and the
“actual funding spent” by line item. Where sizable variation exists (greater than
10 percent), the root cause of the deviation is analyzed by using the same basic
process as would be used for analyzing equipment failures. The root cause of the
deviation is then shared with senior decision-makers throughout the organization.
Finding 7. Investment strategies, definitions of maintenance and repair,
maintenance and repair practices, and methods for budget development
vary among federal agencies as a result of their different missions; the sizes,
compositions, and distributions of their facilities; and their organizational
cultures. The lack of common approaches makes it difficult to compare the
effectiveness of maintenance and repair investments among federal agencies,
to compare the benefits and pitfalls of different investment strategies, and to
benchmark performance for the purpose of continuous improvement.
Between 2004 and the end of 2010, the Federal Real Property Council of the
Office of Management and Budget issued guidance focused on improving the stra-
tegic management of federal buildings and structures, improving the management
of the condition of facilities, developing asset management plans, implementing
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FINDINGS AND RECOMMENDATIONS 85
controls to improve the reliability of facilities-related data, and developing a set of
governmentwide performance measures related to the management of portfolios
of facilities (GAO, 2011a). Although a great deal of progress has been made, more
is required if federal agencies are to continue to improve the management of and
investment in their portfolios of facilities.
Finding 8. Reliable and appropriate data and information are essential for
measuring and predicting outcomes of investments in federal facilities main-
tenance and repair. An array of data, tools, and technologies is available to
support strategic decision-making, to quantify outcomes and risks by using em-
pirical data, to expedite data collection, and to reduce human errors and bias.
Many factors are driving a more strategic approach to facilities management,
but information tools and technologies are enabling it. Information tools and tech-
nologies are now available to monitor facilities’ condition, energy use, and other
performance dimensions and to collect data that can be used to reduce long-term
costs, eliminate human error and bias, and increase operational efficiencies. Data
and information can be the basis of higher situational awareness during decision-
making, of transparency during the planning and execution of maintenance and
repair activities, of an understanding of the consequences of alternative investment
strategies, and of increased accountability. A wide array of tools and technologies
are available to acquire and track data and to measure and predict outcomes of
investments or the lack of investment.
Because the costs associated with data collection, analysis, and maintenance
can be large, the committee believes that “no data before their time” should be an
infrastructure-management tenet. Every system and data item should be directly
related to decision-making at some level, and off-the-shelf decision-support sys-
tems should be fully integrated into decision-making processes. To the extent
possible, data should be collected uniformly among federal agencies so that they
will be more uniform and support the development of governmentwide perfor-
mance measures and the greater use of benchmarking for agency practices and
investment strategies.
Finding 9. Additional research and collaborative efforts are needed to con-
tinue to develop rapid and effective data-collection methods (such as the use
of sensors and visual imaging devices), data definition and exchange stan-
dards that allow interoperability of data and software systems, and robust
prediction models.
Technologies for various aspects of facilities management are continually
advancing in their capabilities. Three technologies that could improve the collec-
tion and tracking of data, improve maintenance and repair activities, and provide
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86 PREDICTING OUTCOMES OF INVESTMENTS IN FEDERAL FACILITIES
support for decision-making are self-configuring systems, machine vision, and
building information modeling (BIM).
Although the benefits of BIMs for facilities management and operations are
apparent, BIM technology in its current form is best categorized as an information
repository. Improved data exchange standards and software systems are needed
for full interoperability of data from many systems. Interoperability, in turn, will
allow more seamless integration of the data and functionalities needed to support
more strategic decision-making related to maintenance and repair investments
and to document outcomes.
Federal agencies participate in and support a number of efforts to develop
the data and exchange standards, protocols, standard definitions, and data items
that are needed if BIM is to reach its full potential as a tool for portfolio-based
facilities management.
RECOMMENDATIONS
Recommendation 1 (Findings 4 and 5). To better manage the economic,
physical, and environmental risks associated with facilities ownership, the
federal government and its agencies should embark on a coordinated, funded,
and sustained effort to dispose of excess and underutilized facilities. They
should also proactively reduce their total facilities footprint through alterna-
tive work strategies and other measures.
Recommendation 2 (Findings 1, 5, and 6). Federal agencies should develop
more strategic approaches for investing in facilities maintenance and repair
to achieve beneficial outcomes and to mitigate risks. Such approaches should
do the following:
• Identify and set priorities among the outcomes to be achieved through
maintenance and repair investments and link them to achievement of
agencies’ missions and other public policy objectives.
• Provide a systematic approach to performance measurement, nalysis,
a
and feedback.
• Provide for greater transparency and credibility in budget develop-
ment, decision-making, and budget execution.
Recommendation 3 (Findings 1, 2, and 3). To develop more strategic
a
pproaches to maintenance and repair investment, federal agencies should
do the following:
• Identify and set priorities among the beneficial outcomes that are to
be achieved through maintenance and repair investments, preferably
in the form of a 5- to 10-year plan agreed on by all levels of the orga-
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FINDINGS AND RECOMMENDATIONS 87
nizations. Elements of that type of plan are outlined in Chapter 7.
• Establish a risk-based process for setting priorities among annual
maintenance and repair activities in the field and at the headquarters
level. Guidance for doing that is contained in Chapter 7.
• Establish standard methods for gathering and updating data to pro-
vide credible, empirical information for decision support, to measure
outcomes of investments in maintenance and repair, and to track and
improve the results.
Recommendation 4 (Finding 6). Federal facilities program managers should
plan for multiple internal and external communications when presenting
maintenance and repair requests to other decision-makers and staff. The
information communicated should be accurate, acknowledge uncertainties,
and be available in multiple forms to meet the needs of different audiences.
The basis of prediction of outcomes of a given level of investment in main-
tenance and repair should be transparent and available to decision-makers.
Recommendation 5 (Finding 7). Federal agencies and other appropriate orga-
nizations should continue to collaborate to develop and refine governmentwide
measures for outcomes of maintenance and repair investments and to de-
velop more standardized practices, unambiguous procedures, definitions, and
m
odels. The committee believes that those activities would be most effective if
under the auspices of the Office of Management and Budget.
Recommendation 6 (Findings 6 and 8). Federal agencies should avoid the
collection of data that serve no immediate mission-related purpose. Agencies
should use a “knowledge-based” approach to condition assessment. Outcome
metrics and models should make maximum use of existing data. When new
or unique data are required to support the development of an outcome mea-
sure or model, there should be a clearly defined benefit to offset the cost of
collecting and maintaining them.
Recommendation 7 (Findings 8 and 9). Federal agencies should continue to
participate in and take advantage of collaborative efforts to develop rapid and
effective data-collection methods (such as the use of sensors and visual imag-
ing devices), to develop data-exchange standards that allow inter perability
o
of data and software systems, to develop the empirical information needed for
robust prediction models, and to develop practices that will reduce the cost of
data collection and eliminate human error and bias.
