Official: North Dakota’s costliest leased space mostly used
BISMARCK, N.D. (AP) — A state official told a North Dakota legislative committee on Tuesday that the state’s largest and most expensive leased office space is now mostly utilized, after it sat nearly vacant for months when an agency allowed its more than 400 employees to work from home indefinitely.
The Associated Press reported in May that taxpayers are on the hook for nearly $3 million in rent over the next two years for the North Dakota Information Technology Department’s unused office space in Bismarck. The report spurred a legislative review of all state leases.
Greg Hoffman, the Information Technology Department’s director of administration, told the interim Government Administration Committee that about 90% of the 85,000-square-foot leased space in a newly remodeled, privately owned office building in north Bismarck is now being used.
The Department of Environmental Quality last month moved about 140 of its employees from a leased office building just north of the state Capitol to the IT department’s space.
Hoffman said the environmental agency is subleasing two floors of the building at $12 a square foot; the IT agency pays $15 a square foot to lease the building.
Other agencies also are using the building’s meeting spaces, he said.
The IT agency is funded at 479 employees, but only “12 to 15” of them currently work in the big building, Hoffman told the AP in an interview.
“Occupancy doesn’t always translate into bodies and chairs,” Hoffman said Tuesday. “It doesn’t mean the building is not being utilized.”
Though the lease was signed before the coronavirus pandemic, Shawn Riley, who heads the Information Technology Department, had already begun moving toward having employees work remotely.
Republican Gov. Doug Burgum has long promoted working from home as a way to cut costs and to “promote workplace flexibility as a recruiting tool.”
Documents obtained by the AP show that the state pays more than $10 million in rent for agencies at about 170 locations statewide, at an average rate of $13.33 a square foot.