The state should sell its underused buildings with the proceeds going to pay for maintenance costs of other state buildings, including repairs to the state Capitol, a lawmaker says.
Rep. T.W. Shannon said he was surprised to learn the state owns about 9,000 buildings, or nearly twice the number of buildings he was told earlier this year. That doesn't include buildings the state is leasing from private landowners.
“When state government owns 9,000 buildings, there is clearly room to liquidate some of those holdings,” said Shannon, R-Lawton. “At a time when dollars are very limited, it is inexcusable for agencies to cling to expensive facilities that are no longer necessary to carry out the agencies' missions or basic operations of government.
“The state's infrastructure has almost become unmanageable,” he said. “We've got infrastructure needs all over the state. The money should be reinvested there. It's a one-shot hit, it doesn't need to be used in the regular budget.”
Shannon was author of House Bill 1438, which passed the Legislature and was signed into law this year. It required a review of state assets to potentially reduce excess and provide for better planning. Shannon requested an interim legislative study to review the effects of the legislation, which took effect Nov. 1.
No recent reviews
When his legislation was going through this year's session, records showed about 4,900 state-owned buildings, but officials did not have a comprehensive list of maintenance expenses or needed improvements. No recent reviews had been done to determine if operation of all sites was needed, Shannon said.
John Morrison, interim director of the state Central Services Department, told members of the House of Representatives Government Modernization Committee last week that the state owns about 9,000 buildings on approximately 6,000 parcels of land. Efforts now are focusing on the age of the buildings and the use of the buildings.
“This is all new territory,” Morrison said.
He said his staff is asking each agency what they need in terms of building space and property. The law requires the report to be finished by the end of next year; rules then would have to be developed on how the property could be sold.
“The opportunities are out there, no doubt about it,” Morrison said.
Three counties have state buildings worth more than $1 billion, according to figures prepared by the agency. They are Cleveland County, home of the University of Oklahoma and other state agencies; Payne County, home of Oklahoma State University and other state agencies; and Oklahoma County, where the Capitol and most state agencies have their headquarters, as well as being home to the University of Central Oklahoma.
HB 1438 creates the Oklahoma State Government Asset Reduction and Cost Savings Program and requires the Central Services Department to identify 5 percent of the most underutilized state-owned properties on a yearly basis.
“Building a comprehensive inventory is just the first step in this process,” Shannon said. “Now we have to streamline asset management, prioritize facilities based on their value to core functions and liquidate those that have outlived their usefulness. Agency resistance to these common-sense management practices will not be tolerated.”
Shannon said he plans to file legislation requiring that proceeds from the sale of state property be placed in a public endowment to pay for the state's deferred maintenance needs.
“To cite just one example, the Oklahoma Capitol — our symbol of democracy — requires $132 million in repairs,” Shannon said. “It is both prudent and necessary to use money generated by the sale of underutilized properties to pay for the upkeep of the facilities that remain vital.”
Visitors to the Capitol are being diverted away from areas where small pieces from the building's crumbling limestone exterior facade began falling about 50 feet to the ground a couple months ago. The 100-year-old building needs a thorough restoration to prevent major failures in its exterior walls and its plumbing, electrical, and heating and cooling systems, according to state officials who have studied building conditions.
State Treasurer Ken Miller said a thorough review of state-held assets, including real estate, will enable policymakers to determine whether the state should continue to own them. It also will allow for better management of state-owned properties.
“We're not taking care of the assets we currently own,” Miller said.
Deputy state Treasurer Regina Birchum told committee members that a meaningful accounting of state properties should include information such as the use of the property, structures on the property, condition of the property and the occupancy rate of state buildings.