The state auditor emphasizes the “exorbitant” costs for commercial pulses by state agencies

In his letter, Foley contained a diagram that shows the price per quadrat foot in the two largest state buildings and large commercial leases.

The state of Nebraska in the 1526 K St. and 301 Centennial Mall in Lincoln had prices per square foot of $ 9.66 or $ 8.33. In the meantime, the price per square foot in commercial real estate was between $ 14.22 in the 1221 N St. up to $ 33.43 per square foot in the 1010 Lincoln mall.

According to Foley, the rise of long -distance work in companies in the private sector creates an opportunity for the state government to buy commercial real estate.

“Many commercial companies have sent their people home. They like this culture. There is a little space. I know here in the city center of Lincoln, there are buildings all over the city that they have empty. Maybe we could buy something from this room,” he said.

Citizenship buildings are bought and rented by the state building department, which is part of the Nebraska Department of Administrative Services, known as that.

The director Lee Will said Lee said that state real estate is cheaper than commercial rental contracts, but mathematics is not so easy. Wants around 50% of the commercial rental contracts to be paid for by federal funds, while the construction of the state office has to come from the US state of Nebraska.

“The comparison of oranges has a little apples because they can use Bundal Fund in the rental model to add this rental agreement,” he said. “If you build a building now, you can't do the same.”

State buildings are also exempt from land, so that every purchase of commercial properties would lead to a hit by the district and school district tax roles.

Will sent a letter to the office of the state auditor in the name of the name of which and provided answers to foleys concerns and recommendations. At the end of the auditor's letter, it was attached that foley had made public on Monday.

Foley said he still recommends that the government buy real estate, but he recognizes that the approach has secondary effects.

“You really have to put the pencil on the paper and carry out a sharp analysis to find out what is the best economic strategy,” he said. “But when I have increased by over 37% in five years, I say:” Hey, let's press the break here and really analyze what happens here. “

At the beginning of 2020, the state announced plans for the construction of a new government building in the 17th and K Street in the city center of Lincoln. If the state had started a 30-year loan for the project at this point, the repayment of $ 92 million would have cost. However, the Ministry of Administrative Services said that the project would save taxpayers over 30 years compared to leasing commercial office space 35 million US dollars.

When the Covid 19 pandemic sent most of the government employees home to work from a distance at short notice, the plans for the building stood.

“Thinking was at that time, look, the lights are in relation to government operations and people are still served. We work from home in thousands and thousands of cases. So why do we build a building?

After the pandemic, civil offices were filled again. In 2023, governor Jim Pillen signed an executive order in which most state employees have to return for personal work. The annual utilization report 2024 submitted last December resulted in a total load rate of more than 97% in the seven buildings that they own and manage.

The state has the property in the 17th and K Street, which it first acquired in 2011, and is currently being used as a geothermal well -being as part of the State Capitol HVAC project.

In view of the current budget deficiency of more than 300 million US dollars, both Will and Foley said that it is unlikely that the funds for the building will be made available for the next two years in the budget.

However, both agree that the development of state property is out of the question in the long term.

“We have to do something with this place,” said Will. “But it's not easy to find $ 92 million, and I think if you ask the public:” Hey, should we build a 92 -millions of dollars for public employees? “I don't know if we would get support.”

Foley's letter also dealt with the potential sale of the Omaha State Office Building and his associated parking garage in the 13th and Farnam Street in the city center of Omaha.

In February, the state building department listed the property for sale and also offered offers for broker services. The occupancy rate of the building was listed at 97.1%.

“If this almost fully occupied structure is sold, commercial real estate areas would be needed for these employees – at a potentially higher rental costs per office square foot,” says Foley's letter.