The FBI has thoroughly bungled its search for a developer to build a new Boston-area headquarters. So badly, in fact, this local controversy may serve as a springboard for national reform of federal development guidelines.

Local Congressman Michael Capuano, the Democrat representing Massachusetts’ historic 8th District, tells me he wants to launch a national review, one that would look at whether federal rules are both dragging out the development of new government buildings and driving up costs.

Capuano’s comments come years after the General Services Administration began its search for a developer with a site in the Boston area to build the FBI a 21st century fortress out of which to run its regional operations.

But with the economy struggling to emerge from a severe downturn, there is no end in sight to a headquarters hunt that began in early 2007.

And what should be a blockbuster, 275,000-square-foot development project, employing hundreds of now-jobless hard hats, is instead just another batch of papers sitting on the desk of some nameless Washington bureaucrat.

“It should have been done by now,” Capuano said of the FBI’s search for a new Boston headquarters.

The Rules Are The Problem

The problem is not with the federal bureaucrats overseeing the search, who appear to have followed procedures by the book, but with the rules themselves.

“If this is normal, then there are some underlying problems here we should at least review,” the congressman said. “If it’s happening here, it is probably happening a thousand times across the country.”

Right now, the FBI appears stuck, unable to make a decision on whether to build its fortress on South Boston’s waterfront or up in Chelsea – exactly where we’ve been for at least the past two to three years now.

That the FBI is inexplicably toying with the idea of building in one of the most expensive new development districts on the East Coast, Boston’s Seaport, is icing on the cake.

While clearly frustrated by the progress he has (or hasn’t) observed, Capuano also made clear that he’s holding his fire for now.

The congressman said he has no plans to push for a review of how the federal government handles major development projects, not at least until after the dust clears on the FBI’s plans to build a new regional headquarters.

That makes sense for a number of reasons, including the fact that the Chelsea proposal is in his district. 

But it’s high time to look at what is driving this dysfunctional process.

From my talk with Capuano, who was happy to point out some general trends, there are a couple major problems here.

First, there is a huge mismatch between the snail’s pace at which the FBI’s real estate handlers have conducted the headquarters search and the heavy requirements federal officials are putting on would-be builders.

Developers are being asked to put up lots of money up front, but then are being forced to sit on valuable sites for years while their proposals are reviewed by various layers of federal paper pushers.

As a result, several developers have simply withdrawn their bids, unable to hang on while the FBI and the GSA bat various proposals back and forth, never making a decision.

That, in turn, forced the GSA, which is overseeing the headquarters search, to put everything out to bid again, chewing up valuable time and leading to the current standoff between South Boston and Chelsea development sites.

“For the owner of a property, it is very difficult to commit to something that is very open ended,” said David Begelfer, chief executive of NAIOP Massachusetts, which represents developers across the Bay State. “You need some certainty to this.”

Secret Obsession

It doesn’t help that the federal government just loves secrecy. To date, the feds have remained pretty much silent about the FBI’s hapless headquarters hunt, saying nothing and keeping all the bids sealed.

But all this secrecy is simply bogging down the process even more, preventing developers from seeing what the competition is up to and making decisions accordingly. That might spur some developers to further sharpen their pencils, while prodding others to get out.

Let’s have a little sunlight.

“No matter what you do, the federal government is going to take more time than the private sector,” Capuano said. “The question is how much more time?”

And along with delaying a sorely needed project as the economy struggles to get back on track, the current process that led to the FBI headquarters mess is likely to hit taxpayers where it hurts, too.

In the aftermath of a brutal downturn, we wind up with just two serious contenders for a project most developers should be scrambling to get.

Sure, South Boston’s waterfront clearly looks attractive to the G-men – it’s just a short walk from the agency’s current Government Center spread.

But it’s also prime real estate that is going to cost an arm and a leg for Uncle Sam to buy, especially compared to Chelsea.

“If they are looking for the biggest bang for the buck, how can anyone look at some of the most valuable property in New England,” Capuano said. “There are different parts of Boston that are undervalued, but the Seaport is not one of them.”