Strategies to Renew Federal Facilities (2023) / Chapter Skim
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Pages 81-87
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From page 81... ...
In this way, via application of ISO 55000 standards, all decision-making activities become risk based. The chain of events helpful to implementing an effective enterprise risk management solution for federal facility renewal strategies is as follows: • The agency commissions policy to implement a facility asset management system.
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From page 82... ...
Independent of the authoritative source that an agency selects to establish its enterprise risk management solution, the following requirements should be applied to all risk management frameworks used to develop federal facility renewal strategies: • Agencies are required to establish and document the risk management frameworks they are using to develop and implement federal facility renewal strategies. This should be made clear in the policies used to establish the agency's facility asset management system.
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From page 83... ...
Finding 5-1: Federal policy is clear, notably in OMB Circulars A-11 and A-123: the purpose of federal facility renewal strategies is to systematically manage risk, with a focus on resource-and-investment decision making to ensure and assure that facilities best support achievement of agency mission objectives and priorities efficiently and effectively. Finding 5-2: The risk management frameworks used must be systematic and documented, must comply with OMB Circular A-11 and A-123 require ments, and must be integral to federal facility renewal strategy development and implementation.
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From page 84... ...
Federal agencies often view funding for facility repair, renewal, and disposal as an expense that they can defer with little or no consequences, and thus treat it as a lower priority than funding the operations of a business or program. This presents a specific and very important use case for federal facility renewal strategies: that is, how to develop budgeting strategies that can coordinate 84
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From page 85... ...
This chapter establishes a basis and understanding for how to view federal facility renewal strategies through this lens in a way directly applicable to current and evolving policy. CAPITAL BUDGETS VERSUS OPERATING BUDGETS One specific hurdle that a federal facility renewal strategy must overcome is reconciling operating budgets with capital budgets.
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From page 86... ...
. Federal Budget Formulation Process Reforms Despite volumes of guidance to the agencies on asset planning and management as described in Chapter 2, agencies still find it difficult to maintain accurate asset inventories or effective asset management systems.
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From page 87... ...
The goal of budgeting is to optimize the allocation of constrained resources to maximize the return while ensuring that it can provide required functions, which is facilitated through applying the operational readiness and performance–budget integration principles also found in Chapter 3. Notwithstanding these investments, federal agencies remain challenged by the need to balance near-term budgetary funding constraints with the long-term capital investment requirements in the real property portfolio and adequately manage the risk this creates for the operating program budget.
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