Florida: Let’s Have a Yard Sale!

Governments should inventory, dispose of unneeded assets

State Sen. Mike Bennett wants local governments in Florida to have the equivalent of a yard sale to fund some of the projects they need. He’s preparing legislation that would require cities and counties take an inventory of the land they own, then get rid of any property they don’t need.

But why stop at land? And why must the law apply only to cities and counties? Even the state ought to take an inventory of everything it owns and look for divestment opportunities.

It’s working in other states. California Gov. Arnold Schwarzenegger South Carolina Mark Sanford recently embraced the idea. They began by compiling a catalogue of the land, buildings and other capital property owned by their states. During this review process, Gov. Schwarzenegger learned that California’s government curiously owns a house that once served as MTV’s Summer Beach House.

Last August, California made headlines with a garage sale of sorts. The state used eBay, the popular online auction Web site, to manage thousands of auctions for surplus office equipment, gadgets, and other stuff accumulated over time.

The idea of staging an auction to get rid of surplus goods has been around for a long time, but technology now gives the would-be sellers tremendous power to reach new buyers while also lowering the costs of holding the auctions.

In many states, development of a land ownership inventory, based on a state-of-the-art geographic information system, has become an important tool in reforming government, saving taxpayers’ money, and right-sizing the bureaucracy.

At the federal level, President Bush has implemented a similar process. The Government Accountability Office found that some 30 federal agencies control hundreds of thousands of real property assets worldwide. These include facilities and land, worth hundreds of billions of dollars.

Unfortuntately, this federal property portfolio is not well managed. Many assets no longer are consistent with the owning agency’s mission or needs. Other properties are in an alarming state of disrepair. In 2001, for instance, the Department of Veterans Affairs spent more than $300,000 to maintain a building that had been vacant for 14 years.

Worse, the GAO also found there are no reliable governmentwide data on these assets. Without an accurate inventory, agencies can’t determine what they can afford to divest or share with other agencies without impacting their own service delivery.

After California’s success, online auctions may also be coming to the federal government soon. Gov. Schwarzenegger issued an executive order instructing state agencies to catalog all property and assets, and he plans to start selling off the surplus.

His budget proposal expects to raise $50 million next year – and even more money in the future – to help patch the state’s $15 billion budget deficit. His budget calls for one-time spending of $2.8 million to coordinate a new asset management policy.

“One of the biggest problems has been just to find out what does the state really own?” the governor said at a news conference. “We don’t know. We have looked at all of the departments, and it’s kind of like fuzzy math a lot of times.”

California state Sen. Jeff Denham had been trying to get an asset inventory started for more than a year. By conducting his own research, he found a golf course in Oakland the state purchased in 1955 to make way for a road. The road was never built, but the state still owns the land. Few people in state government knew the state owned the property until Sen. Denham began his research.

It’s in the taxpayers’ interest for Florida and its cities and counties to each have a current, accurate inventory of their real property assets. It’s also essential that an effective and efficient process be in place to dispose of lands and assets these governments no longer need.

Technology has paved the way for governments to manage their assets more wisely and get rid of them more efficiently. Surplus government assets may have a tremendous value, if only they can be put to good use.

Sen. Bennett’s bill is a necessary first step in a process that ought to be embraced and adopted throughout Florida.

Geoffrey Segal is director of privatization and government reform at Reason Foundation.