4.2 : Real Property      

This policy applies to the acquisition, management, and disposal of real property interests by lease, purchase, condemnation, or otherwise, as well as services related to such acquisition, management, and disposal, other related services, and utilities. This policy codifies the authority for real property transactions by FAA; however, it must be read in conjunction with Procurement policy 3.0.  In the event of a conflict between these provisions and Procurement Policy 3.0, these provisions will govern. Roles and responsibilities in real property transactions, and definitions of real property terms are found in Appendix 1 of this Chapter. For clarification of real property terms and to obtain real property information not found in this Chapter, contact ALO-200.

The acquisition of real property interests is unique from other types of procurements. The FAA's need for a specific site, location, or other special requirements further complicates the real property acquisition process. The goal is to acquire necessary real property interests to meet FAA mission requirements while fulfilling all mandated acquisition requirements. The acquisition process requires sound business judgment, and a competent and professional staff having the highest integrity, with authority delegated to the lowest responsible level.

The FAA Administrator has been given broad statutory acquisition authorities in Title 49 United States Code.   Pursuant to the provisions of Title 49, the Administrator is the final authority for carrying out all functions, powers, and duties of the FAA Administration relating to the acquisition and maintenance of property and equipment. The Administrator has broad authority "to enter into and perform such contracts, leases, cooperative agreements, or other transactions as may be necessary to carry out the functions of the Administrator and the Administration . . .with any Federal agency, or any instrumentality of the United States, any territory, or possession, or political subdivision thereof, any other governmental entity, or any person, firm, association, corporation, or educational institution, on such terms and conditions as the Administrator may consider appropriate." (49 U.S.C. 106(l)(6).)  In addition, the Administrator has the authority to enter into leases that require the use of appropriated funds for terms of up to 20 years.  (49 U.S.C. 40110.)

Real property is defined in Appendix C of AMS policy. 

The procurement process is to be conducted following best commercial business practices, in a fair and equitable manner. Real property interests, related services, and utilities will be acquired by the competitive method whenever practical and reasonable. All real estate transactions (acquisition, management and disposal) will comply with all Federal statutes, Executive Orders, Federal regulations, FAA Orders and the Acquisition Management System (AMS). If there is a conflict between the AMS and FAA Orders, the AMS provisions will govern.

The acquisition process may start with an informal request; however, prior to issuance of a Solicitation For Offer or proposed Lease contract, a signed request from the using service/requiring office must be received. If rental or other costs are involved in the acquisition, a certification of funding must be received prior to any obligation of funds or award of a lease/contract. One document may serve as both the request and the funding certification.

Requirements must be fulfilled by a competitive process whenever practical and in the best interests of FAA. The RECO and the requiring office will meet as early as possible to review, clarify and streamline acquisition requirements and options available to ensure that special requirements and alternative solutions, where appropriate, are considered; to define the appropriate area of geographic consideration, i.e. delineated area, and to ensure that FAA-mandated requirements are met. The RECO may begin the acquisition process with an informal written request from the using service/requiring office. However, the RECO will not issue any formal requests for information or quotes until the requirements are finalized and certified funds are available.

Prior to determining whether to enter into a succeeding lease (if the lease will expire at the end of the current term and no renewal options remain, or, if rent is being paid, the lease has been in effect for 20 years), or to renew an existing lease, the RECO must consult with the using service/requesting office and obtain a statement of continuing need.  Alterations, upgrading, and expansion/reductions of requirements should be considered and included, as appropriate, in the subsequent acquisition and final documentation. When fulfilling the using service/requesting office requirements, the RECO must use the standard land lease, space lease, utilities and outgrant templates and associated forms for all new, succeeding and renewal lease acquisitions. 

In order to complete a renewal or succeeding lease transaction prior to the lease expiration date and prevent FAA from becoming a holdover tenant, the RECO must commence the renewal process, or the process of entering into a succeeding lease, at least 18 months prior to the lease expiration date for all FAA direct land and space leases. For all GSA controlled space, the RECO must commence the renewal process at least 24 months prior to the lease expiration date. This 18-month period is a suggested minimum. Each lease transaction should be considered individually by the RECO and the RECO may determine to afford the transaction additional time if the RECO is aware of issues that could jeopardize timely completion of the lease transaction.

If a continuing need has been determined and it appears the lease will expire without a Supplemental Lease Agreement for a short term extension, or succeeding lease has not been awarded, then

The RECO and the requesting office must use the guidelines for administrative space standards (2.4.1 Administrative Space Standards) when developing administrative space requirements in FAA owned, leased or GSA-controlled facilities. 

The RECO or servicing office must obtain prior approval for space requests from the Washington Area Facilities Management Division (ALO-100) by submitting a Space Request Package which contains the following:  a completed SF-81/SF-81A or a written document with space request, justification/reason for request, complete staffing and workstation patterns, floor plans (if applicable), office space per person, support space, special space by type, number of parking spaces required for government owned vehicles. Initial or Expansion requests for Air Traffic Organization (ATO) facilities and offices require prior written approval from AFJ-61 (See attachment 3) and must be included in the Space Request Package.

The RECO must use the No-Cost Land on Airport Memorandum of Agreement (1.1.5.1 No-cost Land on Airport MOA template) for transactions with airport sponsors who receive Airport Improvement Funds. Land for NAVIDS on airports without Airport Grant Assurances (including military airports) will be leased using the standard on airport land lease template. When an airport has received an Airport Grant Assurance requiring it to provide rent free space to the FAA, the RECO must follow Rent-Free Guidance (2.4.5: Appendix E: Rent-Free Guidance) until otherwise notified.

The FAA requesting office/using service must give first consideration to rural areas when searching for locations for new space, other facilities (i.e. research and development facilities, warehouses, labs, clinics, etc.), and land acquisitions, unless mission or program requirements call for urban areas. A rural area is defined as a city, town, or unincorporated area that has population of 50,000 inhabitants or less, other than an urbanized area immediately adjacent to a city, town, or unincorporated area that has a population in excess of 50,000 inhabitants.

In developing & finalizing lease requirements, the RECO must coordinate with both the LOB and the Servicing Security Element (SSE) to comply with the personnel requirements of FAA Order 1600.72A, Contractor and Industrial Security Program and the facility security requirements of FAA Order 1600.69B, Facility Security Management Program.  It is the responsibility of the SSE to classify the users, the risk and the accessibility levels of the tasks to be performed and determine whether an FAA badges should be issued to the contractor employees.
Prior to executing any lease or lease renewal  requiring access to programs or resources located in the leased space, the RECO must have a FAA Form 1600-77 Contractor Position Risk/Sensitivity Level Designation Record signed off by the SSE (see FAA Order 1600.72A).  If the SSE makes changes to the 1600-77 submitted for their signature, the RECO will accept changes.

In 1996, NIST RP-4 Standards for Seismic Safety for Existing Federally Owned or Leased Buildings, February 1994, instituted a requirement on all Federal agencies leasing space and buildings to follow Interagency Committee for Seismic Safety in Construction (ICSSC) standards similar to the requirement for existing owned buildings. RP-4 was superseded by RP-6 in 2002. (link to http://fire.nist.gov/bfrlpubs/build01/PDF/b01056.pdf), Standards for Seismic Safety for Existing Federally Owned or Leased Buildings, January 2002). RP-6 requires a "Seismic Safety Certification" to be performed following the requirements of FEMA 310 prior to signing any new lease, or renewing existing leases. In 2003, FEMA 310 was superseded by American Society of Civil Engineers (ASCE) Standard 31-03, Seismic Evaluation of Existing Buildings. RP-6 Section 1.3 lists exemptions that may relieve an Agency of the seismic safety certification requirement. These exemptions must be applied on a case-by-case basis. The following guidance (2.4.8 Appendix H: Seismic) gives guidance for the evaluation process of safety and exemption applicability.

To the extent that it is applicable to FAA real property transactions, FAA RECOs shall comply with the Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970, as amended (promulgated in 49 CFR Part 24). See (http://www.fhwa.dot.gov/realestate/49cfr.htm and http://www.fhwa.dot.gov/realestate/UAfnl99.htm) Provisions of the Uniform Act are mandatory and are applicable to each Federal agency that administers programs or provides financial assistance for projects, which involve land acquisition or relocation assistance.

To the extent that parking space is available and affordable, it is the policy of the FAA to provide adequate parking for official Government vehicles and adequate free parking for employee vehicles at all FAA-owned and leased facilities. In order to promote fuel conservation, reduce traffic congestion, reduce demand for parking spaces and reduce air pollution, the FAA will make available as many parking spaces as possible for the use of vanpools/carpools. For more information please see vehicle guidance (2.4.2 Appendix B Vehicle Parking Guidance).

FAA real property transactions are subject to the requirements of FAA Order 1050.19B, Environmental Due Diligence Audits in the Conduct of FAA Real Property Transactions, in order to identify and minimize potential environmental liabilities associated with the condition of the property and past activities at the site.  The Environmental Due Diligence Audit (EDDA) process shall be completed prior to executing contracts for the acquisition or disposal of real property.
The FAA will also comply with the requirements of the National Environmental Policy Act (NEPA) in accordance with FAA Order 1050.1E for property acquisitions, as applicable.  Chapter 3 of FAA Order 1050.1E provides information on categorical exclusions.  Specifically, paragraph 310 provides the list of categorical exclusions for FAA actions involving facility siting, construction and maintenance.  Unless the action is categorically excluded from the NEPA review process, an Environmental Impact Statement (EIS) or Finding of No Significant Impact (FONSI) shall be approved before negotiating the acquisition of any new land interest.

The RECO makes the determination of whether the requirement will be satisfied through competition or single source acquisition. A preliminary assessment such as an informal market survey via phone calls of potential available sources within the geographic area of consideration, i.e. delineated area, may be needed to assist in the determination of the procurement method.  Competition is the preferred method of procurement and should be used whenever practical and reasonable. Competition is obtained by providing two or more sources an opportunity to express an interest in satisfying the requirements. Competition is appropriate when the requirement is not site or location specific and reasonable possibility exists that there is more than one provider that can meet the FAA's needs.  Interest from potential sources may be expressed either orally or in writing.

The RECO works with the program office to determine the delineated area to fulfill the mission of the FAA. The RECO is not required to solicit offers from all sources within the geographic area of consideration. It is only necessary that offers be solicited from a sufficient number of sources (at least two sources are sought, if possible) to promote competition to the extent practicable and reasonable. Data obtained during the market survey, and/or advertisement, and/or appraisal can also be used to determine a range of reasonable rents charged by Lessors within the area of consideration for space or land similar to that being acquired by FAA. (See below for more information.)

When utilizing the competitive method of procurement, the FAA must conduct a market survey to obtain market information and identify potential sources within the geographic area of consideration or market once the lease requirements have been finalized. Market survey data can be used to: determine the availability of properties within the area of consideration; eliminate unsatisfactory properties from consideration; determine the willingness of landowners to provide property for the FAA's use; determine fair market rents; determine suitability of responses to advertisements; and, determine the estimated cost for the leasehold.  When possible, the survey should include on-site visits with the requesting office to determine if suitable properties are available, or if properties offered in response to an advertisement meet requirements.  Prior to conducting the market survey, the FAA should have developed a draft Solicitation for Offer or a draft lease contract defining specific requirements. The draft SFO or draft lease contract should be reviewed with the offer or offeror’s representative to ensure a full understanding of FAA's requirements. 

If the competitive method is used, once offers are received, selection for final award may be made. Selection from the competitive method may be made based upon that proposed offer that best meets the FAA's requirements as defined in the SFO or proposed contract lease document. If the acquisition is being conducted using the single-source method, the RECO can begin negotiations with the single offeror immediately upon receipt of an offer.

Based on the results of market surveys or appraisals, the RECO must negotiate with property owners to obtain the necessary land/space interests at a fair and reasonable cost.  The RECO should remember that the value of the Government's enhancements to the property, or the intended use of the property by the Government, should not be considered in determining the procurement or lease cost of the real property.  The offer(s) should be reviewed to determine which offer(s) best meets the requirements as indicated in the SFO and/or proposed lease contract.  Any reasonable offer received up to the point of award may be accepted and considered at the discretion of the RECO.  If the evaluations indicate that the offerors have different interpretations of the FAA’s requirements, the RECO is encouraged to implement a process to clarify the ambiguities and allow offerors to revise their proposals in accordance with the clarifications provided.

All items may be communicated and discussed with offerors with the goal of clarifying the FAA's needs and providing a basis for the final contract to assure that all costs involved are fair and reasonable. Communications may continue up to the point of award and may be terminated at any time by the FAA.

Like the acquisition of leasehold interests, the utility acquisition process must be conducted following the best commercial business practices in a fair and equitable manner, while complying with all applicable regulations.

Eminent domain proceedings, in accordance with established procedures, should be initiated when negotiations have reached an impasse and a satisfactory conclusion to the procurement cannot be reached. Generally, protracted negotiations are not in the best interests of either party. Legal participation is required on all condemnations. The Department of Justice rules on condemnation and requirements for title must be followed when real property is acquired through purchase or condemnation proceedings. (1.1.19 Condemnation Guidance)

Competitive awards must be made to the offeror whose offer best met FAA’s requirements/needs as defined in the SFO and/or proposed lease contract.  The offer selected should provide the best value to the United States, cost and other factors considered.  The RECO shall document the objective criteria supporting the rational basis, i.e. the negotiator report (1.3.6 Negotiator Report) and placed in the real estate lease contract file. 

The RECO is authorized to enter into firm-term leases within established restrictions (2.4.4 Lease Terms).  The RECO may award firm term leases not to exceed 20 years under the authority of 49 U.S.C. 40110(c)(1) without violating the Antideficiency Act.  If a lease requires the payment of rent above a nominal amount—e.g., $1.00 per year--a new lease must be procured when the existing lease contract has been in effect for 20 years.

All alterations and/or improvements must be based upon technical requirements, business practices, or programmatic needs. Initial alterations, improvements, related items, and services associated with real property will be considered awarded through competition when included within the scope/requirements of the original procurement.

The RECO, or designated representative, should arrange to inspect the real property sufficiently in advance of the occupancy date to ensure it is acceptable and ready for use. Substantial, non-punch list deficiencies that would impact FAA use and/or occupancy of the real property in support of its mission must be corrected before acceptance of the real property, related service, or utility service.

There are two sources of authority under which the FAA may dispose of real property: 

Sufficient documentation must be developed that explains and justifies the procurement action taken. These documents should be retained in the applicable real estate acquisition file.  The RECOs must use a 6 part folder system for all their acquisition files.  The RECO must use the land, space and/or utility checklist when putting together the documentation for the lease file. 

Real Estate Managers and/or their designees are to ensure that adequate records are maintained for all FAA owned, leased, and utilized real property.  Managers and team leads are responsible for the accuracy and quality of the work of the RECO and should review the lease document files to ensure compliance with AMS.  Further the real estate managers should ensure the real estate employees are trained in accordance with the real estate competencies and curriculum.

All real property assets must be recorded in Real Estate Management System (REMS) in accordance with the REMS User Guide ( http://rems.faa.gov/UserGuide.htm ).  Land and space ownership should be recorded in REMS after the title passes to the Federal Government.  Land, structure and space leases should be recorded in REMS after the lease is fully executed.  Other real estate assets, purchased by procurement contracting officers (i.e. structures), should be recorded in REMS after completion of the Joint Acceptance and Inspection (JAI), as part of the regular close out process. The program office with management responsibility that authorizes a change of location of a structure must notify the RECO with that changed location information.  The RECO will make the change in REMS following notification by the program office.  Logistics personnel must ensure accurate and complete real property asset data entry into REMS. All lines of business must assist logistics personnel in the annual inventory to validate required data elements in accordance with Federal Real Property Council (FRPC) and the DOT Asset Management Plan (AMP).

Source selection information and proceedings shall not be discussed outside the service organization. The Source Selection Officer (SSO) shall determine the extent to which source selection information is disclosed and shall execute a Certificate of Nondisclosure as appropriate.

FAA is subject, with modifications as described in the Procurement Toolbox, to the Procurement Integrity Act (41USC 423).

The policy of the FAA is to avoid awarding contracts to contractors who have unacceptable organizational conflicts of interest.

Any service organization or Office of Dispute Resolution (ODRA) member who is a Federal employee that has a real or apparent conflict of interest must withdraw from participation in the procurement process when required by law (18 U.S.C. 208) or regulation (5 CFR Part 2635). Non-Federal service organization or ODRA members are held to the same standards in order to sustain the integrity of the procurement process.

FAA may, to the extent practicable and cost effective, use electronic commerce procedures and processes, including acceptance of electronic signatures, to conduct and administer procurement actions.  The Electronic Signatures in Global and National Commerce Act (E-SIGN) provides an equivalency between legally-required written records and the same information in electronic form.

When an health-related emergency occurs and is declared by the United States Department of Health and Human Services Centers for Disease Control and Prevention (CDC) or other authorized Federal, state or local government official, the FAA Real Estate Contracting Officer (RECO) is authorized to acquire additional cleaning supplies or services in our leased facilities.  For further information, please see Section 2.4.14, Appendix O: Disaster or Emergency Janitorial Services.