Office of Property Management

Public Oversight Roundtable on Theft, Fraud and Abuse Prevention in the Office of the Chief Technology Officer, the Department of Human Resources, the Office of Property Management, Office of Employee Appeals and Contract Appeals Board

Testimony of Lars Etzkorn, Director Office of Property Management

Adrian M. Fenty, Mayor
Committee on Workforce Development and Government Operations
Member-AT-Large Carol Schwartz, Chairperson

Thursday, 13 December 2007, 2 pm
John Wilson Building, Room 412
1350 Pennsylvania Avenue, NW
Washington, DC 20004-3003

Good afternoon Chairperson Schwartz and members of the Committee on Workforce   Development and Government Operations. I am Lars Etzkorn, Director of the Office of Property Management (OPM).  I am pleased to be a part of this roundtable discussion on preventing theft, fraud and abuse.

Let me start by acknowledging the Chairperson’s long-standing oversight to ferret out waste, fraud and abuse in District government.  Chairperson Schwartz, your efforts have improved government business practices and increased accountability.  Just one example is with Addison Road, a dark period at OPM.  As I’ll explain more fully, we are implementing many reforms as a result of legislation passed to reform OPM post-Addison Road. 

Over the last year, OPM has met Mayor Fenty’s objective of increasing accountability and efficiency in government. We have achieved this through increasing transparency, accountability and implementing best business practices.

OPM Internal Reforms

When I became Director, we restructured OPM to increase transparency and accountability.  Working within OPM’s existing personnel authority, I hired a number of key individuals, to provide more oversight of our key business operations and to provide greater checks on decision making – again to increase transparency and accountability. 

Specifically, OPM created and hired a Deputy Director-Construction, Gerick Smith, to provide dedicated senior level management of the $800+ million dollars worth of ongoing capital construction.  Previously, capital construction was managed by the same person who had oversight of our facility division.  I am pleased our newly created Deputy Director-Facilities, Spencer Davis, was hired from within the agency.  These two significant business units now have focused dedicated oversight.

OPM has also created other positions specifically tasked with ensuring transparency and accountability.  For example, to manage our agency’s $86 million operating budget and the aforementioned capital program, we created a Resource Allocation Analyst position and hired Jamie Lantinen, to prepare the agency’s budget and to ensure funds are withdrawn only from appropriate accounts and only with proper documentation. 

In addition OPM hired its first General Counsel, Camille Sabakahn, to ensure legal sufficiency of all actions. Furthermore, OPM’s General Counsel reviews transactions to ensure they are supported by rational objective business decision making.

Pursuant to legislation passed in the aftermath of the Addison Road purchase, DC Code Title 10-1013 requires OPM is required to promulgate rules and procedures governing acquisition and disposition of District-owned real property.  I’m pleased to report OPM, is meeting this mandate  As required, once drafted the rules will be  submitted to Council for your review.

The initial chapters regarding acquisition and disposition of real estate are currently under internal review for submission to Council early next year. The acquisition chapter will provide the methods of contract formation and selection of property for District use. The sections regarding disposal of real estate will provide standards for identifying surplus property, requirements to regularly survey our real estate inventory to identify surplus property, requirements for inter-agency transfers and utilization of surplus property to meet District space needs, criteria for obtaining appraisals, guidelines for identifying the method of disposition (e.g. negotiated sale versus public sale) and various other provisions to assist OPM in systematizing its departmental operations and handling of real property.

Performance Assessment

Recognizing the importance of transparent objectively-measured performance, we have hired a staff person, Tanya Washington, dedicated to this important oversight function.  An integral component to performance-based accountability is the Fenty Administration’s CapStat program.  OPM has been actively involved in this program, having our performance discussed relative to fixed costs, homeless services and vacant properties. We are pleased that not only have we been able to participate in these data-driven discussions, but have successfully met the Fenty Administration’s objectives for our agency. In fact, OPM’s FY 2007 CapStat budget analysis has been used as a model for use in reviewing other District agencies.

OPM’s FY 2008 Performance Plan, which outlines the performance measures and major initiatives for the agency over the next three years, was hailed by the City Administrator as one of the best in District Government.  We have taken these initiatives and objectives and incorporated them into each individual employee’s performance plan for FY 2008, thereby holding staff accountable for these measures. This supplements the mandatory ethics training that every OPM employee had earlier this year.

Office of the DC Auditor and Office of the Inspector General

We recognize the significant role the Office of the DC Auditor plays as an arm of Council in ensuring the integrity of government operations.  Earlier this year, I directed a review of not only all previous Auditor reports on OPM but also all Office of the Inspector General Reports.  We have completed this review and are tacking all recommendations and progress to-date on implementation.

For example, OPM hired an Asset Officer in our Portfolio Division, Kathleen Linebaugh, to audit existing leases to ensure we only pay our landlords what is owed.  By auditing leases, we recovered substantial monies.  In FY 2007, we collected over $8.2 million for the District. For example, we recovered $700,000 from WMATA and over $4.2 million on leases for antennas on District property. To date in FY 2008, OPM has collected over $3 million from lease audits.

Auditing has also led us to discover two cases where utility services for two locations we do not lease are being billed to the District. You have my assurance that OPM will get to the bottom of this matter.

Furthermore, I am pleased to announce that just this week, we hired a full time OPM overseer for Eastern Market, Matthew Hussman, who will implement the recommendations from the 2002 audit concerning the Market. With this new position, we will be able to help continue our successes at rebuilding the Market.

The new ARCHIBUS computer program provides a single source for documents relative to our facilities – for example, leases, titles etc.  This new system will help us fulfill our audit requirements on information management and fixed costs.

Many of the recommendations in the 2002 audit regarding 4800 Addison Road will be addressed by the forthcoming rules I discussed earlier.

Finally, I would like to thank you Councilmember Schwartz, for holding this roundtable.  In light of recent events, it is good to discuss publicly how we ensure the integrity of government operations.  There is no higher calling than to hold the public trust as servants of the citizens of the District of Columbia.  It certainly pains me when any fellow District employee brings discredit to us all through malfeasance. 

I am pleased to answer any questions.