DHS Real Estate, Funding Mission Possible

– Executive Summary

This thesis examines the Department of Homeland Security’s (DHS) real estate management, a pivotal but often overlooked facet of homeland security infrastructure. Focusing on funding strategies, it scrutinizes DHS’ efforts in managing its substantial real estate portfolio, which incurs an annual expenditure of approximately five billion.[1] This study assesses the financial implications of these strategies, and considers colocation or the sharing of workspaces and their impact on operational efficiency and workspace optimization within DHS.

The research initially targeted the underfunding of colocation projects among DHS components, the operational agencies within the Department. However, the scope expanded to include a broader analysis of the Department’s financial practices related to real estate investments. This led to formulating a critical research question: “How can the DHS more effectively fund real estate investments?”

The literature review engages with a range of perspectives on federal real estate management, drawing comparisons and insights from the practices of the Department of Defense (DOD), DHS, and the General Services Administration (GSA), reports from the General Accounting Office (GAO), and the National Academies of Sciences, Engineering, and Medicine April 2023 Committee on Strategy to Renew Federal Facilities report.[2] This section focuses on the multifaceted challenges of federal real estate management; these challenges include reducing space, enhancing operational functionality, and securing adequate and sustainable funding for property assets.

The methodology of this paper centers on qualitative research: in-depth interviews and a focus group discussion with senior executives from DHS, its individual components, and the GSA are used. This approach was designed to create a comprehensive understanding of the diverse viewpoints and challenges in managing and funding DHS’ extensive real estate portfolio.

The findings revealed a consistent theme of pessimism from DHS Headquarters (HQ), Component, and GSA officials regarding the funding constraints for DHS and federal government real estate investments. The study identified several key challenges: pervasive underfunding, significant maintenance backlogs, and the complexity of managing a highly diverse property portfolio. The thesis, therefore, emphasizes the urgent need for innovative funding models and a collaborative, cross-agency approach to managing federal real estate assets.

The thesis concludes that DHS, and a significant portion of the federal government, face considerable hurdles in effectively funding and managing real estate investments. It advocates for a strategic realignment in DHS’ property management, recommending that DHS HQ take ownership, control of funding, and operations of specific real property assets to streamline colocation and space management efforts. This strategic shift, however, would require new statutory authority and a deepened commitment to collaborative efforts among partnering agencies. Should DHS acquire the right to own properties, in addition to funding for the construction and management of these facilities, an inadvertent repercussion may emerge in the form of a need for supplementary staffing resources.

While the study provides critical insights into DHS’ real estate management, it acknowledges inherent limitations, such as the constraints of time and potential biases in qualitative data collection. The thesis outlines several avenues for future research, including the exploration of how workplace environments affect DHS staff recruitment and retention, the security risks associated with colocation strategies, and the exploration of no-cost transfers of assets between federal agencies.

The thesis underscores the complexities and potential strategies for enhancing DHS’ real estate funding and management. It is intended to contribute to understanding the challenges and opportunities in optimizing real estate in support of homeland security goals to support DHS’ frontline personnel enabling mission performance, thereby offering insights for policymakers and stakeholders in this critical area of federal infrastructure management.

[1] Department of Homeland Security, FY2021-2023 Annual Performance Report (Washington, DC: Department of Homeland Security, 2022), 166, https://www.dhs.gov/publication/dhs-fiscal-year-2021-performance-accountability-reports.

[2] “Base Realignment and Closure (BRAC),” Office of the Under Secretary of Defense for Acquisition & Sustainment Base Realignment and Closure, accessed February 3, 2023, https://www.acq.osd.mil/brac/; National Academies of Sciences, Engineering, and Medicine, Strategies to Renew Federal Facilities (Washington, DC: National Academies Press, 2023), https://doi.org/10.17226/26806; US General Services Administration, Annual Budget Requests (Washington, DC: General Services Administration, 2024), https://www.gsa.gov/reference/reports/budget-and-performance/annual-budget-requests; Department of Homeland Security, Real Property Capital Plan Fiscal Years 2021 through 2025 (Washington, DC: Department of Homeland Security, 2020), https://www.dhs.gov/publication/dhs-real-property-capital-plan; David C. Maurer and David J. Wise, Federal Real Property: DHS and GSA Need to Strengthen the Management of DHS Headquarters Consolidation, GAO-14-648 (Washington, DC: General Accounting Office, 2014).

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