It’s easy to get lost in Washington, and the easiest place is around the Mall, where partial rotaries and unmarked ramps give driving a distinct Alice-in-Wonderland quality. Many of the unmarked ramps lead to the Virginia bridges, and even native Washingtonians fear these roads. The attrition rate for tourists is especially high. Like medieval sailors falling off the edge of the world, tourists are constantly falling off the Mall into Virginia.
But an even nastier place to get lost is along the wharfs of the Anacostia River south of Capitol Hill. You might end up all the way down at Buzzard Point. There you will find lifeless alleyways, sad old tenements, an electric generating station, and the dust clouds of a gravel plant. It looks like a scene from On the Waterfront until you notice…a high-rise office building. Right on the wharf off a buckling unpaved road stands a nine-story glass-walled wonder housing parts of the FBI and the Department of Defense. The building itself is, charmingly, also named Buzzard Point. It is owned by Southwest Joint Venture, which built it for the government on a “lease-construct” basis, and it costs $2.7 million a year to rent. But as we shall see, a bizarre location is the least of the Buzzard Point building’s problems. Nearly everything is wrong with it, and that might also be said of the federal leasing program.
In early 1975, the Securities and Exchange Commission asked the General Services Administration, which manages federal office space, for a new headquarters building. Filling requests for office space is an important job at GSA. While we like to think of “federal buildings” as monuments and museums, almost all of the government’s real estate holdings are in plain old office space. Of the 230 million square feet of space the government owns or leases, only 50 million square feet is “special purpose”— monuments, laboratories, and ceremonial buildings like the Capitol. New “special purpose” buildings are rare but demand for new office space is unending. So for developers and bureaucrats alike, offices are where the action is.
Government can acquire office space in three ways. First, it can rent on the open market, shopping around for a floor here and a floor there like any other prospective tenant. Open-market renting is clearly the best way to fill temporary needs. Yet to Washington, the process has fatal flaws. First, it’s hard to get an entire building on the open market. Government is strongly prejudiced towards the prestige (and in some cases logistical convenience) of commanding entire buildings. Second, open-market leases are for short terms, generally one or two years, and that means running the risk government workers will be thrown out if the landlord can find a higher-paying tenant. But most of all government has few “temporary” requirements. Agencies never shrink, they only grow more slowly at some times than at other times.
Government’s second option is to build buildings itself. That means having the Treasury put up the money, having GSA function like the general contractor, and having the structure publicly owned. This approach has some advantages although, as will be explained later, not as many as it should.
The third option is “lease-construction.” A private developer is commissioned to build an office to specifications. Government then leases the building back on an exclusive basis. The developer puts up the capital and owns the building; government guarantees his rental income.
This arrangement was devised during the Eisenhower administration. Veteran GSA officials say Eisenhower issued orders to find any and every way to keep the budget down, maintaining the appearance of a fiscally conservative government with tight purse-strings. Lease-construction fit that bill perfectly.
When Washington builds a building itself, the total construction costs must be appropriated in the budget for whatever year the building is commissioned. Buzzard Point cost $1 I million. If it had been a federal construction project, an expense of $11 million would have been included in the fiscal 1977 budget.
When Washington enters a lease-construction agreement, however, only that year’s rent is listed on the budget. The government has been paying Buzzard Point’s annual rent of $2.7 million every year since 1976—so $13.5 million, more than the building cost to build, has already been spent. The Buzzard Point lease expires this summer. GSA officials say it is all but certain to be renewed (and at a higher rate). If the lease is renewed through the expected 20-year life of the building, total rents (including numerous escalators) might reach $75 million or more—for an $11 million building.
But in any given year, the budgeted expense for rent will always be less than the $11 million that would have had to be listed if the building were government-built. To the Washington establishment this is a “victory” because it keeps the office budget grand total—the figure newspaper editorialists jump through hoops over— artificially low. The fact that the government is contractually obligated to at least five years (and often 20 years) of rent is not listed anywhere. The General Accounting Office estimates that the government’s unavoidable contractual obligation for leased office space is always at least four times the official rent appropriation.
Congress, the president, and the Office of Management and Budget love this little white lie to the taxpayers so much that leasing of federal office space continues to zoom. The amount of leased space has doubled in the last 15 years, from 46 million square feet to 94 million square feet. Lease payments now consume more than half of the total amount Washington spends on housing its employees, expenditures having risen from $131 million 15 years ago to $680 million today. The total is expected to reach $1 billion in two years.
Meanwhile federal building has nearly come to a halt—only about $35 million for direct construction was in last year’s budget. Washington, that big, bloated monster supposedly swallowing everything in sight, is getting out of the business of owning buildings. Because at the end of a lease, “federal” buildings still belong to their developer. All the government has, as Senator Daniel Moynihan is fond of saying, is a “drawerful of rent receipts.”
There are, it should be said, a number of classic private-sector efficiencies involved in leasing privately owned buildings; in some respects private office space looks pretty good. Unfortunately none of those efficiencies were involved at Buzzard Point.
The Laszlo Bidder
After GSA got SEC’s 1975 request for a new headquarters, it quickly decided on the lease-construct avenue. The Public Works committees of the House and Senate then authorized a 380,000-square-foot building at a maximum annual rent of $2.8 million. Three developers bid the job.
Southwest Joint Venture won with the lowest bid, asking $7 a square foot for an annual rent of $2.5 million (later upped to $2.7 million). Southwest is run by a Dr. Laszlo Tauber, one of the Washington area’s biggest federal landlords. Besides the low bid, Tauber had a number of advantages over other developers. One was that he already had development permits for the property, which he had purchased options on before the bidding began.
In Washington so many agencies, commissions, and boards must grant approval for construction that building permits are often more prized than money. This is compounded by Washington’s cornice law, the nation’s toughest. No building can rise above 15 stories, the height of the Capitol dome. The cornice law eliminates skyscrapers, significantly increasing the total number of buildings needed. “Where’ in other cities you would need to acquire and get permits for one piece of property; in Washington you need two or three sites,” said a local developer. “That means going through the same regulatory bullshit two or three times. Washington construction has the highest proportion of lawyers to bricklayers of any city in the county.”
Still there was this little drawback to Tauber’s plan—the location of Buzzard Point. Technically the wharf is only two miles from the Capitol, but there are railyards and battle-zone ghettos within that radius too. The next-lowest bidder wanted an extra 15 cents per square foot, but offered to build in a convenient downtown location where land is many times more expensive—in all a far better deal for the government.
When SEC realized its grand headquarters would be a long, bumpy cab ride from the nearest French restaurant, the agency swung into action. It bent the ears of patrons on the Hill and friends in the press. The SEC showed considerable resourcefulness, enlisting, for example, the aid of the National Capital Planning Commission under the pretext that the few acres of industrial wharf should be preserved as “greenspace” to provide “public access to the waterfront.” SEC documents railed against the location as unconstitutional, because it would hinder the agency’s “ability to disclose information to the public.”
But while the SEC has frightened billion-dollar corporations possessing global reach, it failed to impress the GSA. One reason, as Ronald Kessler, a Washington Post reporter, has documented, is that Tauber hired lawyer Arthur S. Lowell to lean on then-GSA administrator Arthur Sampson. Lowell was a propitious choice, since he was a personal friend of Sampson. Sampson saw to it that Tauber’s deal went through, and just to show how deeply he admired the developer’s business acumen, later went to work for Tauber.
Meanwhile SEC’s defenders on the Hill were helpless to intervene. Office building contracts never come to the House and Senate floors. Money for buildings is appropriated by the Public Works committees, acting alone. You may seem to recall reading something in a civics text about the checks-and-balances system and how nothing could escape the purview of the greatest deliberative body in the world. Buildings are an extraordinary exception to the normal constitutional procedures. There is a floor vote to determine the overall total that can be spent on office space, but what buildings the money goes to and where is up to the Public Works committees. So GSA kept those committees happy, and that was enough to protect Buzzard Point.
When the building was finished in 1976, it had two problems. First, its quality was only slightly on the plus side of a Quonset hut. Ceilings were head-scraping low and sagging; walls vibrated like tambourines; there was no landscaping anywhere (nor any provision for it). Proponents of organic architecture might say Buzzard Point merged with its environment by being the world’s first pre-dilapidated building.
The second problem was that the SEC refused to move in.
In theory, the SEC could have been ordered to move. But try finding enough sheriffs marshalls to evict 1,300 people. After SEC refused to have anything to do with Buzzard Point (it later petitioned Congress for authority to make its own office space arrangements), GSA tried to persuade the Agency for International Development and the Treasury Department to move in. Both refused. GSA then tried to order its own personnel into the building, and even they refused.
Meanwhile, government was paying $7,500 a day to rent an empty building. Tauber had a contract, right? The building was ready for beneficial occupancy, right? It wasn’t Tauber’s fault everybody thought the place had cooties.
Since lease-construction offices are built exclusively for federal use, government is a captive tenant. The immediate problem, as Rowland Freeman, Carter’s last GSA administrator, has noted, is that developers can get away with grade-Z service. The tenant can’t leave, so what do they have to lose by not changing lightbulbs or fixing air conditioners? But more important is that government must pay whether it actually occupies the space or not.
A particularly perverse law prohibits government from subletting. So when space isn’t needed, it must sit idle, with taxpayers taking a bath on the rent. This is why you don’t find federal offices and commercial offices interspersed with each other in government buildings. Subleasing idle space would make a lot of sense, since it would replace a pointless expense with a source of income. But, so goes the line, having private offices around would detract from the dignity of the federal enterprise. After all, program planning analysts would be dangerously close to those tacky, temporal types who actually make and do things.
Besides offering the developer 100-percent occupancy and a guaranteed profit from rental income, the captive-tenant arrangement helps him gain special breaks in financing. Developers get loans for lease-construct contracts on the basis of their guaranteed occupancy and the government’s impeccable credit. Since the loans are risk-free, banks offer preferential interest rates; this enhances the developers’ profits in a way not immediately apparent when looking at square-foot charges. Again, Buzzard Point is a good example.
Southwest Joint Venture is a syndicate of 34 investors, including Tauber, Lowell, and 20 doctors (three of them, company records show, bearing the first name “Laszlo”). The investors pledged $2.1 million in capital and $4 million in loans; the balance of the $11 million construction cost came from banks. The bank loans, Tauber later explained in court documents, were obtained using the guaranteed profit from the lease as collateral. In 1977 Buzzard Point’s investors made a profit of $530,000, Kessler reported. That equates to an annual return on capital of 25 percent—guaranteed.
A Slight Alteration
Buzzard Point sat vacant for two years, as $5.4 million in rent was wasted. GSA finally persuaded the FBI and Department of Defense, two agencies that specialize in people who do as instructed, to order personnel into the building. Just as soon as that happened, a new kind of money began to flow to Tauber—money for alterations.
The FBI didn’t like Buzzard Point’s layout. It wanted different paneling and special cables for its gee-whiz communication systems. So Westwood Construction, a company that by chance has the same business address as Southwest Joint Venture, began $539,000 in alterations. Over the years, GSA files show, Westwood has done nearly $2 million worth of alterations on Buzzard Point.
Since alteration contracts are “sole-source”- awarded without bidding—they almost always go to the leased-building developer. They are the icing on his cake, providing him a line of business in which the customer often doesn’t exactly drive a hard bargain.
The GAO has found, for instance, that GSA “cost estimates,” which supposedly control alteration profiteering, are sometimes prepared and slipped into file folders after the work has been performed and paid for. After $587,000 worth of alterations performed by the developer on an office in San Francisco, a GSA official admitted he had compiled the cost estimate sitting in the developer’s office and working solely from his figures. The estimate included such carefully itemized categories as “Plants— $76,055.”
Like adding a room onto a house, alterations can increase the value of the property. The property, remember, is private property. When GSA decided to lease an existing suburban Washington office for the Bureau of Alcohol, 27 cost came from banks. The bank loans, Tauber later explained in court documents, were obtained using the guaranteed profit from the lease as collateral. In 1977 Buzzard Point’s investors made a profit of $530,000, Kessler reported. That equates to an annual return on capital of 25 percent—guaranteed. A Slight Alteration Buzzard Point sat vacant for two years, as $5.4 million in rent was wasted. GSA finally persuaded the FBI and Department of Defense, two agencies that specialize in people who do as instructed, to order personnel into the building. Just as soon as that happened, a new kind of money began to flow to Tauber—money for alterations. The FBI didn’t like Buzzard Point’s layout. It wanted different paneling and special cables for its gee-whiz communication systems. So Westwood Construction, a company that by chance has the same business address as Southwest Joint Venture, began $539,000 in alterations. Over the years, GSA files show, Westwood has Tobacco and Firearms, it sunk in $2.2 million in alterations (performed by the developer on a sole-source basis). While the alterations were proceeding, GSA paid full rent on the building, to the tune of $407,000. So the government’s total investment in the office, before the first revenuer could walk in the door, was $2.6 million. Before this investment began, the building had been appraised at $1.5 million. The appraisal more than doubled after the government investment.
Thus developers can exercise a special kind of entrepreneurial creativity—the more alterations they talk their tenants into, the greater their profits and the greater the value of their equity. Here is forged one of the unlikely alliances that enliven Washington life, an alliance between bureaucrats and builders. If you spend much time wandering through government buildings, you notice that there is always a wall going up here or being knocked down there. Bureaucrats are forever reorganizing, and reorganizing means rearranging the cubbyholes. Reorganizing lends the appearance of furious action, lets bureaucrats grant themselves raises by changing their titles, and most importantly allows them to claim they are doggedly assembling a crack new management team to tackle the nation’s problems—at an unspecified later date, when the reorganization is completed. The building developer is only too anxious to please by forever rearranging the offices of deputy assistant deputies in relation to those of assistant deputy assistants. The GSA’s budget for alterations and repairs this year is $180 million.
Alteration to accommodate computers is also popular, and this points to another of the myriad ways leases are used against the taxpayer. In theory, government has the ability to bargain for a good deal on office rents. Whenever the lease comes up for renewal (usually at five- to ten-year intervals) the GSA can threaten to move out. Alteration investments, however, make this already-farfetched possibility even less likely.
The government leases a large block of offices from Charles E. Smith Co., builder of Crystal City, a modern office mall near National Airport. The lease at Crystal City Building Two was up for renewal in December 1978. One of its major tenants, the U.S. Patent Office, wanted $160,000 worth of alterations for the installation of computers. GSA gave Smith Co. a sole-source contract to perform that work in May 1978.
You can imagine the poor GSA negotiator sitting in the developer’s office, as heavy cranes are swinging computers by the window and a workman in the hall yells, “Hey, Ralph, give me a hand bolting this Patent Office stuff to the floor.” The negotiator then says, “I must caution you, Mr. Smith, if your offer is not satisfactory, we shall vacate the premises.” Perhaps there’s no need to finish the story; in December Smith Co. hit the government with a 79 percent rent increase.
A particularly imaginative variation on the alteration theme occurred at Columbia Plaza in Washington’s Foggy Bottom. This lease-construction project sat unoccupied for almost two years while the GSA tried to persuade someone to move in. The U.S. Customs Service finally agreed to do so, demanding $570,000 in alterations, which it got. Customs then changed its mind and didn’t move in.
Other leasing flim-flams are almost too numerous to mention. One involves acquiring space without ever consulting Congress at all. The Public Works committees must give approval to any building lease committing the government to more than $500,000 a year in rent. But the GSA can sign lesser rents on its own. When the Veterans Administration wanted to take over the Union Center Plaza North building in Washington, it also wanted to avoid unpleasantness with Congress. So GSA rented four floors of the building for $452,000 a year. Then three months later it rented two more floors for $236,000 a year, bringing the grand total to $688,000 a year, but never involving the Congress.
Every pro basketball player’s favorite word, renegotiation, is also important in leasing. While the initial terms of lease agreements are subject to demanding legal scrutiny, subsequent changes are treated like a little matter among friends. As construction of Columbia Plaza neared an end, the developer, John McShaine Inc., announced that it would not let the government take occupancy without a rent renegotiation. Instead of saying, “Congratulations, the building’s yours,” GSA renegotiated—to the tune of an extra $14 million over the length of the lease. Two weeks later, GSA started paying that bloated rent—paying for nothing, you remember, because there was nobody to move in. McShaine later sold the building to the government of Kuwait, so Kuwait is now the landlord getting the guaranteed profits on the guaranteed occupancy.
Dr. Laszlo Tauber himself is another pioneer in profiting from quirky renegotiation rules. The lease of his Parklawn Building in Rockville, Maryland, once required him to pay for utilities. Tauber proposed in mid-1973 that the government assume utility costs. Tauber offered in return to drop the rent about $900,000 a year, even as his books showed that utilities at the Parklawn Building were costing about $1.7 million a year. GSA officials were apparently too busy contemplating this higher math to read their morning newspapers, because they signed the deal in the spring of 1974, when something or other was going on with the Arabs and energy prices. Over the life of the Parklawn Building lease, GAO now estimates, that renegotiation will cost taxpayers an extra $9 million—exclusive of any increases in the cost of energy.
Of course, not all federal landlords play these games; many are sincere businessmen trying their best to muddle through. Ironically, it is the honest ones, laboring to abide by all the regulations in good faith, whose profits are squeezed. Following GSA rules honestly means a nightmare of redtape—and lower profits than what honest private-sector developers earn. As a result, some builders say, the best developers often shun federal work, leaving the field to the less worthy.
This logic is not lost on Congress; recently it froze the awarding of lease-construction contracts. But new buildings are still needed, if only to replace the old ones wearing out. Should they be built by Washington directly? Our guide now turns to that question.
Here Cons De Judge
One of the few new federal construction projects to be approved in recent years is a $13 million courthouse and office for Redding, California, a small town 170 miles north of Sacramento. The building is slated to house the U.S. District Court. The catch is that the District Court does not sit in Redding.
By the wildest coincidence imaginable, Redding is dead-center in the district of former Rep. Harold “Bizz” Johnson. Johnson was, until the voters came to their senses last fall, chairman of the House Public Works Committee. “Redding was his reelection project,” said an informed Senate aide. “His staff was quite blunt in telling us, ‘Look, we’ve got to get this building before the election.'”
Where the lease-construction mechanism is an invitation to guaranteed profits on dismal dumps, the direct-construction avenue invites political glorification. A new building “certainly makes a representative or senator who is running the next year feel very good,” says Senator John Chafee. “Federal buildings do add a lot of class to a place.”
Bizz Johnson started the Redding ball rolling by employing the no-floor-action system. In February 1980, he asked GSA to compile a “prospectus” on building needs in Redding. Requests for a prospectus can be voted out of either the Senate or House Public Works committees, and occasionally some other committees. In June the Department of Agriculture— slated to occupy part of the building because the phantom court alone couldn’t justify a large enough project—informed GSA that it was already satisfied with its offices in Redding, records show. Admiral Freeman, then administrator of the GSA, looked over the file and declared the project a boondoggle; on a day he was out of town one of his deputies signed the prospectus and returned it to Johnson: By that time the building proposal included a district office for Johnson.
Johnson’s committee quickly voted out money for the building, and expected the parallel Senate committee to do the same. If it had, construction could have begun immediately, without the question ever going to the floor. Senator Alan Simpson protested the bogus building, however. Playing on pre-election Democrat-Republican rivalries, Simpson got the Redding project delayed, hoping to finish it off later.
In November the people spoke and Johnson was out. But the Redding project did not die with him. During December’s lame-duck session, Congress traditionally grows sentimental about its departing members. After all, Christmas is coming, and seeing their fallen colleagues wander the halls without anyone trying to bribe them makes congressmen think forward to the day of their own inevitable defeat—the shame, the ignominy, and the added insult of having to pay for their own parking. So they customarily award going-away gifts, the congressional version of the gold watch. Johnson’s gift was the Redding courthouse, which both the House and Senate reinstated.
An oft-proposed solution to the pork-barrel problem is appropriating building funds on the floor, instead of in committee. One well-informed House staff aide insists this would only make the situation worse. “As it is now, we’ve got the pork barrel confined to the Public Works committees and a few committee chairmen,” he explained. “If we voted out buildings on the floor, then everybody could get his pet project passed.”
But setting aside the shenanigans of congressmen, there’s a more maddening drawback to the direct-construction approach. It activates all the federal inflation and inefficiency guarantees we have come to know and love.
Direct federal projects must pay construction workers according to the Davis-Bacon Act, which means inflating wages out of all contact with reality. Carpenters in a federal building in Boston were making $19 an hour recently while carpenters in a nearly identical private project about a block away were making $13 [See “How Big Labor Brings Home the Bacon,” February]. Federal projects must also comply with the BuyAmerican Act, which forbids use of less-expensive foreign materials; they must follow small-business and minority-contractor set-aside procedures, which means higher prices to subsidize businesses that, through legal chicanery, are often neither small nor minority-owned. Federal projects must pass through multiple layers of regulatory hearings, including filing the mind-numbing Environmental Impact Statement, which means a delay of one or two years even if all goes well.
Further inflating direct-construction costs are government building standards. On a lease-construct arrangement, the GSA issues only “performance” standards, meaning it tells the developer what type of building to build and approximately how it should look and function. Direct-construction involves “prescriptive” standards, meaning the government specifies everything—materials, measurements, pennyweight of nails and how many peepholes to drill in the sidewalk fence. “It’s the difference between a booklet of specifications and a wheelbarrow,” says James Whitlock, an assistant commissioner of GSA.
Government specifications favor fortress-like masonry structures capable of withstanding a light artillery assault. Most are designed with a 50-year lifespan in mind; the speculative office building is commonly designed to last 20 years. In the main durable government buildings are a good idea. However much you dislike the immortality of the bureaucracy, you might as well house it in the cheapest possible way, and studies have repeatedly shown that anytime you know a building will be needed for a long time, it’s cheapest to build it properly at the start.
Government building standards are highly resistant to innovations in construction technology—which is a good thing, since construction innovations seem single-mindedly dedicated to the purpose of making buildings miserable penitentiaries. It is almost impossible, for instance, to build a glass-walled building under government codes. That’s truly a blessing. Glass-walled building designers are the prime exponents of that wonderful advance, no windows, and people who like to breathe must fight them at every turn. But here again, the price goes up. Glass-walled buildings are cheaper and take less time to build.
Another reason federal buildings are so expensive is that they suffer from what architects call “quality creep.” They have high ceilings, broad hallways, and spacious concourses designed to convey an air of grandeur and munificence. They can include offices with private baths and showers and similar platinum-plated features GSA inserts at the insistence of top agency executives. Architects call this “creep” because it lends the impression of quality without actually improving the usefulness of the building. (Broad hallways and sweeping concourses also mean heating and cooling extensive empty space.)
All things considered the GAO estimates it costs 40 percent more for a government-built building than a private-built one of equivalent use. The lease-construction arrangement was devised both as a budgetary gimmick, and to circumvent this extra expense the government had imposed upon itself.
Gentlemen, choose your economist, take ten paces and fire the question: which is cheaper, building or leasing?
A lease-construct building generally costs the government 2.5 times more over a 20-year span than direct construction. That disparity sounds shocking, but in truth it isn’t. When you work backwards from the 2.5 premium, considering inflation over the lease span, the cost of borrowing, and what you could earn by investing the capital you didn’t have to put up in the first place (a process called “discounting to present value”), you come out with leased and federally built buildings costing about the same, the OMB says. But if leasing and owning cost roughly the same, wouldn’t you rather own?
There could be an intermediate position—a lease deal that ends in ownership, which is common in industry. The GSA lacks legal authority to enter such contracts, however, because they require up-front cash to buy a purchase option. For some reason Congress considers spending the public’s money on options to be highly distasteful—probably because it would involve a capital appropriation that would appear on the budget.
The GAO estimates that most federally built offices recover their costs of construction and finance by the 14th year. Private industry likes investments that “pay back” in the five-to ten-year range, and would be unimpressed with a 14- year recovery. But government isn’t industry; its needs are more stable and enduring, so longer-range investments are suitable.
What’s needed is a much more flexible federal building approach, which repents from budget gimmickry and considers each of the three options—open-market renting, lease-construction, and building—in each case to find the most sensible arrangement. Often that will be open-market renting, because a floor here and a floor there is really all the government needs, as can be seen from the examples of GSA buildings sitting vacant. On rare occasion, the sensible choice might be lease-construction. On many other occasions, it will be building.
To make a true choice, however, all the inefficiency guarantees in each category must be done away with. It’s silly for GSA space-finders to be unable to rent offices on the open market because, for instance, GSA policy makes it almost impossible to place good-faith deposits; by the time government can act on desirable space coming into the market, it’s usually been snapped up. It’s equally silly for the government to use lease-construction to circumvent the very rules it imposed on itself, like Davis-Bacon, set-asides, and the eternal EIS. When government is running a construction job, it should operate just like any private contractor. This may not be politically easy, but it’s the only thing worth proposing because it’s the only thing that makes sense.
By the time this issue is published there should be an important bill before Congress which would accomplish some of these goals. Sponsored by Senator Moynihan and nearly passed last session under the title S.2080, the bill would all-but-outlaw lease-construction. It would also mandate design competitions for major government buildings—a vital step in the effort to return creepless quality to government architecture.
The bill is worthy, but needs improvement. It shows little interest in open-market renting, and sets a timetable for tossing federal workers out of leased buildings. If taken seriously this timetable would require the government to launch an ambitious program of building 100 new offices over the next 15 years, at a cost of at least $1 billion yearly. Ronald Reagan may not be too thrilled about that. Also, Moynihan’s bill perpetuates the little white lie. New buildings would be financed by borrowing from the Treasury at T-bill rates, but only the year’s loan payments, not the total budgetary obligation, would be listed anywhere taxpayers might see it. The cost of building should be reported frankly. And there is, of course, one other way in which Moynihan’s bill could be improved—it could specifically ban any projects containing the words Buzzard, Bizz, or Laszlo.