BISMARCK — The largest privately-owned office space leased by the North Dakota state government has been mostly vacant over the last year due to the COVID-19 pandemic and could stay that way as the department housed in the building has allowed its employees the indefinite option to work remotely.
North Dakota taxpayers will have to foot the bill for close to $3 million for the North Dakota Information Technology Department's 85,000-square-foot north Bismarck office building over the next two years. A remodeling project plus the pandemic have left it largely unused since July of 2019, and Shawn Riley, the department's director, said a dozen to 14 of his agency's more than 400 employees are currently using the space regularly.
Many state employees have slowly returned to in-person work over the last year, especially in the Capitol, which was humming again during the recently closed legislative session. About 70% of the some 1,800 employees on the Capitol grounds have returned to their offices, said North Dakota Capitol Facilities Manager John Boyle.
But the work-from-home status of North Dakota agencies is up to their individual directors, and Office of Management and Budget Director Joe Morrissette said the IT Department has utilized the remote opportunities more than most of other government divisions.
"Part of it is the culture of the agency," said Morrissette, who added that some state jobs would be impossible to accomplish without coming into the building, while those that are largely internet-focused, like IT, can take leeway. "Shawn Riley is kind of embracing it."
Gov. Doug Burgum told The Forum this week that the problem of expensive unused office space isn't unique to North Dakota, noting that many states and large corporations across the country are searching for ways out of leases on properties they realize they no longer need.
"We knew we had more space than we needed pre-COVID," the Republican governor said. "Now we think we have way more space than we need."
In an interview, Riley noted that the vacancy of the IT Department office actually dates to before the pandemic, since renovations began on the building in 2019. The state didn't incur any new costs on the building during the renovation period because of an agreement with the landlord, Riley said, but by the time the construction was finished in September of last year the agency was well into its remote status.
Riley, who was hired in 2017, estimated that he's spent 90% of his tenure working in North Dakota, but also has worked remotely from his home in Minnesota. He noted that conference rooms and joint working areas are still being used in the IT Department's Bismarck headquarters, but added that the advantages of remote work have allowed the department to hire people around the state.
Burgum spokesman Mike Nowatzki said the governor trusts Riley and other agency heads to make independent decisions about their remote work during the pandemic.
"The governor believes government should always be looking at ways to decrease its physical footprint and save taxpayer dollars," Nowatzki said. He added that the IT Department is looking for other agencies who might sublease their unused space.
Some top North Dakota officials have been looking to reassess the state's leased office space since before the pandemic, and the Office of Management and Budget Department is currently assessing possible reductions. No agencies have so far opted to vacate or downsize their space in the Capitol building, Boyle said, but the state has downsized its private leasing holdings elsewhere in Bismarck. In 2019, the state paid $6.6 million in rent for 438,000 square feet of leased office space, and through agency reevaluations the square footage has been cut down by more than 80,000 square feet, for $1 million in savings for the state.
"We can really reduce our rental costs by just taking care of a few agency's leases," Boyle said.
The lease on the Information Technology Department's building won't expire until 2025, though agencies have a statutory clause that would allow them to break their leases without liability if the Legislature decreases their funding, a prospect that Boyle said can make it challenging for the state to get private leases.
And though Morrissette noted that the prospect of altering the state's office holdings was discussed during the recent legislative session, he said most lawmakers felt it was "too soon to make big decisions about our long-term space" because of the lingering uncertainties around post-pandemic life.
Lawmakers in this year's session approved a study into the use of government office space in the Capitol, though they aren't obligated to fulfill it.
Readers can reach Forum reporter Adam Willis, a Report for America corps member, at firstname.lastname@example.org.