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Business approach may be useful in budget battle

Aug. 5, 2012 - 01:53PM   |  
By BRIAN BROWN   |   Comments

As agencies across government look for solutions to the challenges posed by budget reductions, “business as usual” is not an option. But a business mindset may offer the best tools to overcome budget headwinds and improve operational efficiency. The Air Force’s Enhanced Use Lease (EUL) program is a shining example of a federal effort with a business approach.

Through the EUL program, the Air Force Real Property Agency has formed collaborative relationships with industry to develop commercial real estate and renewable energy projects on Air Force property. In essence, the Air Force leases land to developers in return for lease or “in-kind” payments.

For example, when the city of North Las Vegas agreed to lease land from Nellis Air Force Base, Nev., to build a wastewater treatment plant, the lease payment included funding construction of a $25 million fitness center at the installation. That’s $25 million that did not come from taxpayer dollars. Since 2007, the Air Force has completed nine EUL projects worth about $231 million.

To be successful, the EUL program has evolved from a bureaucracy-bound leasing function to a way of extrapolating maximum value from Air Force real property assets to benefit the war fighter. Along the way, we’ve learned some vital lessons:

Challenge assumptions

In business, time wasted is money wasted. Government processes are often long and needlessly complicated. We are constantly refining our EUL process to develop projects and get them to market quickly to take advantage of the opportunities the marketplace offers. We challenge every process assumption, every requirement, every “way we’ve always done it” approach. As a result, our processes are more efficient, meaning our funding stretches further with each improvement.

Unleash creativity

Industry knows the best creative ideas are born where the work happens, not the executive suites. When federal agencies empower employees to be creative and take responsibility, good things happen. For example, employee creativity led to a project worth about $1.5 million to lease an Air Force hyperbaric chamber at Wright-Patterson Air Force Base, Ohio, to a medical company. The Air Force will continue to use the chamber, while the company takes on maintenance and management cost.

Build partnerships

In a budget-conscious world, the turf wars that seem to plague government entities are a waste of time and money. Industry doesn’t hesitate to partner when collaboration makes good business sense. By reaching across divisions, government entities can share knowledge, resources and economies of scale to achieve results.

The Air Force, Army, Navy and Marine Corps partner to share EUL program knowledge, and we’re considering ways to bundle our projects to make them more attractive to developers. We are also working with private utilities that serve multiple military installations to identify the best renewable energy projects for their markets. And we work with agencies like the Interior Department’s Bureau of Land Management to make our projects succeed.

Customer first

Industry pours resources into understanding customer needs, wants, complaints and concerns, and then can focus on issues that block the path to customer satisfaction. We apply this concept when we consider potential EUL projects.

By considering the needs of all our stakeholders — from the airmen at the installation where the project is being built, to the Air Force leaders who give the go-ahead, to the congressman who explains the value of the project to his constituents, and more — we deliver best value for the Air Force.

Industry strives to get the most out of every dollar it spends. By focusing on value and return on investment, agencies can weather the budget storms and emerge better suited to manage the funds the American taxpayer has entrusted to us.

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Brian Brown is chief of the strategic asset utilization division at the Air Force Real Property Agency and manages the Air Force’s Enhanced Use Lease Program.

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