A U.S. General Services Administration official had bad--and some good--news Monday for Fredericksburg-area business owners interested in selling or leasing office space to the federal government.

The GSA's budget for new construction has been chopped from $750 million in fiscal year 2009 to $50 million this fiscal year, but it plans to spend $5.237 billion on private-sector leases, said David Ehrenwerth, associate commissioner of the GSA's Public Buildings Service.

"Essentially, there isn't the money to do new construction," he told area government officials and business leaders at a breakfast meeting. "If you're looking to lease buildings, maybe that's good news."

Ehrenwerth and Rep. Rob Wittman, R-Va., were guest speakers at the event, which was sponsored by the Fredericksburg Regional Alliance. It was held at the University of Mary Washington's Stafford County campus.

The Public Buildings Service, a major division of GSA, manages the federal government's national real estate portfolio of approximately 375 million square feet in more than 9,600 properties across the United States.

Wittman, who represents the First District, submitted a House bill nearly two years ago that would have directed the GSA to treat the area the same as the localities in the National Capital Region for purposes of signing leases.

Area developers say the GSA often won't consider properties outside that area, which goes as far south as Prince William County. But Wittman cited a number of reasons why the federal agency should look at the Fredericksburg region--which includes the city and the surrounding counties of Caroline, King George, Stafford and Spotsylvania.

They include the fact that the federal government is looking for office space outside the Washington area so it can continue to operate if something such as cyber attack were to happen in the nation's capital. Locating more offices here also would increase the number of people with a reverse commute, which helps alleviate traffic congestion on major highways, he said.

The GSA has 38 leases totaling 755,562 square feet in Virginia's First Congressional District, which includes much of this region and stretches as far south as Hampton and Newport News. About a third of those leases will expire in three years, Ehrenwerth said. At that point, his office will either extend the leases or seek cheaper, and possibly smaller, spaces.