Speaker says state should sell surplus sites
BY WAYNE GREENE World Senior Writer
Wednesday, January 30, 2013
1/31/13 at 5:23 PM
Correction: A Wednesday Tulsa World story and an accompanying list of underutilized state property incorrectly reported the status of the Laura Dester Center. An office building and three children’s centers at the former Laura Dester Center site, 619 S. Quincy Ave., are considered underutilized. This story has been corrected.
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OKLAHOMA CITY - Speaker of the House T.W. Shannon is working on a plan to sell off surplus state property to fund repairs to other buildings, including the crumbling state Capitol.
Assets unused
T.W. Shannon: The House Speaker has proposed a central board to manage and sell state property to increase efficiency and finance capitol repairs.
A recent report from the state Office of Management and Enterprise Services shows Oklahoma owns 6,910 buildings - more than any other entity in the state - and leases close to 1,000 more.
Only the federal government owns more Oklahoma land than the state.
The report shows that many of the properties are "underutilized," which Shannon says is a signal they should be considered for sale, with the proceeds used to fund the most pressing maintenance needs of its other state buildings, including the Capitol building, which has a crumbling limestone facade, troubled plumbing and wiring and accrued maintenance needs totaling an estimated $160 million.
Historically, the management of the state's assets has been inadequate, politicized, uncoordinated, inefficient and expensive, Shannon said.
Shannon's solution: Break part of the control of state agencies over their property and centralize planning and funding.
"We need to take the politics out of handling state assets," he said. "Right now, what you have is our state agencies operate in silos, like mini-fiefdoms."
The OMES report shows 78 state agencies own real estate and there is no central authority for managing property purchase and maintenance decisions.
Shannon's House Bill 1910 would create a state Asset Management Board, with members appointed by the governor and legislative leaders. It would have the authority to sell surplus buildings and use the money for maintenance at the Capitol, the Medical Examiner's Office, the half-built American Indian Cultural Center and Museum in Oklahoma City or other priority projects.
All three of the specified projects have been targeted for funding in state bond issues for the past several years.
By selling off surplus state properties and adding state funding on a cash basis, Shannon said the state can cut down the size of bond issue needs and reduce political opposition to the needed work.
In April, state Auditor Gary Jones released a report criticizing the state's control of its property.
In a telephone interview Tuesday, Jones voiced many of the same concerns as Shannon.
"We need a strategic plan of what we're going to do," Jones said. "Right now, we have property that we didn't even know we owned that's not being utilized. We're actually out there leasing other facilities while we may have space available that state agencies or organizations could be using.
"Why in the world would you let them maintain an asset that's not being utilized? Why in the world would we let someone sit on an asset that could be used by someone else?"
The state needs a property master plan and one group overseeing all state property, he said.
"Someone needs to be in charge instead of the current hodgepodge," Jones said. "There needs to be a central management group that is in charge of state properties."
Any agencies seeking to lease new property should have to go through the central office, which could first determine if there was property available in the state's existing inventory, he said.
The state needs to do everything possible to make repairs to the Capitol on a cash basis without increasing the state's debt, he said.
By taking a more critical look at the proposed work and paring it down to real needs, and then funding those costs over time on a cash basis, Jones said the state can repair the Capitol without burdening the future with debt.
"Let's don't go out and spend $150 million and then figure out what we need to do. Let's figure out what we're going to do with it, and then accommodate what the needs are," he said.
The OMES report is the first of its kind in state history.
It was written in response to previous legislation, written by Shannon and mandating a full inventory of state real estate and an analysis of what properties are underutilized.
In addition to the 76.4 million square feet of buildings and structures owned by the state, another 993 buildings - comprising 6.6 million square feet - are leased by the state, the report shows.
Oklahoma State University is the largest single state property holder, with almost 11.3 million square feet of property owned or leased, 14 percent of state government's total. The University of Oklahoma is the second-largest state property giant, at almost 10.7 million square feet under its control, 13 percent of the state's holdings.
Other state agencies with large property holdings include the Department of Corrections, 8 percent; University Hospitals Authority, 4 percent, and Human Services Department, 4 percent.
Not surprisingly, some 23 percent of the state's property is in Oklahoma County, home of the state Capitol complex. The next largest counties for state property holdings are Cleveland County, home of OU, at 16 percent; Payne County, home of OSU, 14 percent and Tulsa County, 5 percent.
Some 59 percent of the state's property is being used for colleges and universities. The next largest purpose is office space, at 16 percent.
The report uses standards of the Real Estate and Leasing Services to analyze what state property is being utilized at 50 percent or less of their capacity and categorized those properties into three groups.
Many of the state's underutilized properties would be very difficult or impossible to sell because of environmental issues, location within campuses, complex title issues and other complications. But the report's top tier includes properties that are underutilized, have a significant value, and appear saleable.
Property value estimates were made by OMES staff working with county assessors and, in some cases, appraisals in agency records.
Proprieties in that top tier include the Northern Oklahoma Resource Center in Enid, the Southern Oklahoma Resource Center in Pauls Valley and parts of the Laura Dester Center in Tulsa.
Jones said the state needs to reform its thinking about property maintenance and property purchases.
"Legislatures will spend every single penny they can get and every single penny they can borrow from the future, but they're not solving problems for the future," he said.
Selling state property to fund maintenance costs is a step away from that profligacy and toward a more rational approach, he said.
"I think that's something we ought to be doing," Jones said.
Key underutilized state properties
Northern Oklahoma Resource Center
Location: Garfield County
Owner: Department of Human Services
Purpose/Status: Built as a facility for the developmentally disabled, the Human Services Commission recently voted to close the facility and transfer clients to community care settings.
Size: 488,505.90 square feet
Estimated value: $1,796,000
Southern Oklahoma Resource Center
Location: Garvin County
Owner: Department of Human Services
Purpose/Status: Built as a facility for the developmentally disabled, the Human Services Commission recently voted to close the facility and transfer clients to community care settings.
Size: 381,395.10 square feet
Estimated value: $1,568,352
Haskell Building
Location: Muskogee County
Owner: Connors State College
Purpose/Status: Classroom building and parking lot/vacant
Size: 630,752 square feet
Estimated value: $1,393,657
Laura Dester Center
Location: Tulsa County
Owner: Department of Human Services
Purpose/Status: Emergency shelter for abused and neglected children/several buildings are unused.
Size: 65,461.3 square feet (entire campus)
Estimated value: $1,115,500 (entire campus)
Oklahoma State Bureau of Investigation central laboratory
Location: Oklahoma County
Owner: OSBI
Purpose/Status: Laboratory/Storage and weekly use by staff
Size: 19,000 square feet, 1.8 acres
Estimated value: $688,000
State Capital Publishing Museum
Location: Logan County
Owner: Oklahoma Historical Society
Purpose/Status: Museum and historic site/closed much of the year because of a failed heating system.
Size: Unavailable
Estimated value: $597,293
OETA Office and Studio
Location: Tulsa County
Owner: Oklahoma Educational Television Authority
Purpose/Status: Studio and office space/50 percent utilized, declared surplus property by OETA in 2012
Size: 6,500 square feet
Estimated value: $300,000
Source: Oklahoma Real Property Asset Report/ Office of Management and Enterprise Services
Wayne Greene 918-581-8308
wayne.greene@tulsaworld.com
