HD37 - Final Report: Review of Deferred Maintenance in the Commonwealth


Executive Summary:
The Commonwealth of Virginia has a $1.626 billion deferred maintenance backlog for 5,269 of the 10,449 buildings inventoried in the Facility Inventory and Condition Assessment System (FICAS). As agencies assess the remaining buildings, the statewide backlog will increase. The buildings assessed and included in the next six year capital plan are usually an agency or institution’s top priority projects. However, all needs are not included in the plan. There are many buildings, new and old, not represented in the capital plan that may have unfunded needs. Therefore, we are unable to predict the extent that the deferred maintenance backlog will increase once agencies assess all buildings. Assessing the remaining buildings is critical to continuing this initiative.

FICAS demonstrates the value of having a centralized database with building condition assessment information that will provide the Governor and General Assembly, once it is fully populated, with a cost effective capital planning tool. The Commonwealth can use this tool to ensure that available funding will provide the maximum return on our facility investments. However, costs in FICAS include construction costs up to the subcontractor level only and generally do not include design costs, general contractors’ overhead, agency administration, or any special conditions required for projects. These soft costs may increase the cost by 20 to 30 percent.

According to the Appropriations Act, upon completion of the initial implementation phase of FICAS, the Auditor of Public Accounts will transfer responsibility and oversight of FICAS to the Department of General Services on or about May 1, 2006. We have concerns over whether General Services has the resources to administer FICAS and the Facility Assessment Program. Over the years, General Services has taken large budget cuts, which have prevented them from accomplishing their many responsibilities related to building maintenance and construction. To be successful, General Services needs adequate funding to administer FICAS and the Assessment Program. Without the proper personnel and resources, FICAS will fail.

In addition, to be successful, the Commonwealth must implement the recommendations from this report in conjunction with the recommendations in our interim report. Ultimately, if the Commonwealth continues to ignore the issues with the current capital outlay and maintenance processes, the deferred maintenance backlog will accelerate and no accountability will continue to exist for most agencies. We recommend that the Governor and General Assembly consider the following:

• implement the recommendations from our Interim Report on Deferred Maintenance in the Commonwealth and the Review of the Commonwealth’s Capital Outlay Process;

• direct General Services and Planning and Budget to establish policies and procedures for maintaining and updating building condition information to support a statewide Facility Assessment Program;

• approve sufficient funding for General Services to establish an Assessment Program and administer FICAS;

• reorganize General Services and its divisions to ensure competent and productive leadership of FICAS and the Assessment Program;

• as an alternative to reorganizing General Services, create a new Department of Capital Asset Management to oversee the statewide assessment and capital outlay programs; and

• direct the State Council of Higher Education for Virginia to work with Planning and Budget to have one uniform and consistent reporting mechanism across all state agencies and institutions of higher education to request capital outlay.

[For Interim Report, see HD11, 2005.]