A bipartisan bill to create a program that allows Federal agencies to lease underutilized properties – and to use the rent payments to help fund capital projects – has advanced in the Senate.

The Saving Money and Accelerating Repairs Through (SMART) Leasing Act – introduced by Sens. Gary Peters, D-Mich., James Lankford, R-Okla., Kyrsten Sinema, I-Ariz., and Josh Hawley, R-Mo. – was approved by the Senate Homeland Security and Governmental Affairs Committee on March 29.

The legislation would create a pilot program to allow Federal agencies to sublease underutilized property with approval from the Administrator of the General Services Administration (GSA) to any person or entity at fair market value – including another department or agency of the Federal government or an entity of a state or local government.

Revenue generated from the leases would help fund important projects, save taxpayer dollars, and prevent government waste, the senators said.

“Leasing underused space at federal properties will help root out waste and improve government efficiency,” Sen. Peters said in a statement. “This commonsense, bipartisan bill will also generate additional funds for projects to improve government facilities at no additional cost to taxpayers.”

The committee amended the legislation before sending it to the Senate floor to provide 50 percent of revenue generated from leases to capital improvements and maintenance, and the other 50 percent would go towards reducing the deficit.

The SMART Leasing Act requires the GSA Administrator to certify that any lease will not have a negative impact on the mission of the Federal agencies, and that the terms and conditions of the lease protect the interests of the country.

“Taxpayers deserve to know that government resources are being used as efficiently and effectively as possible,” said Sen. Hawley. “This legislation takes an important step toward generating new revenue from underutilized federal property to ensure our federal agencies are responsible stewards of taxpayer dollars.”

Federal agencies routinely hold property that could be used more effectively by other public and private entities, the senators’ press release states. For example, an agency campus could have extra space they cannot sell but could provide an optimal home for solar panels. Some agencies could also have space and equipment they need part time but could otherwise be well-suited to university or private partnerships.

The bipartisan legislation would allow Federal agencies to explore ways to fully utilize their property and generate revenue to fund other projects – such as long-needed maintenance, revitalization, and other improvements, as well as deficit reduction.

The act was modeled on a similar program used by NASA – which has generated millions of dollars in revenue for the agency to use on capital projects and facilities maintenance, the press release says.

“This bill builds off of a successful program at NASA, which has saved the taxpayers millions of dollars each year and will encourage other agencies to look for ways they can be better stewards of federal property,” said Sen. Lankford. 

The bill limits the number of leases to six per year for the first two years after enactment to determine the impacts of this program, at which point GSA can advise Congress on whether the program should be extended or expanded.

The group of senators previously introduced the SMART Leasing Act during the 117th Congress, where it passed the Senate days before the end of the congressional session.

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Cate Burgan
Cate Burgan
Cate Burgan is a MeriTalk Senior Technology Reporter covering the intersection of government and technology.