Marina
The state of Kansas is facing serious questions about how it manages its vast portfolio of state office space.
A recent audit by the Kansas Legislature’s auditing division found that the Kansas Department of Administration (KDOA) lacks formal policies for estimating operating costs and setting rental rates for state-agency tenants within the 4.1 million square feet of state-owned or leased office space.
The audit signals major concerns for taxpayers, state agencies and accountability advocates alike.
What the Audit Found
The audit revealed several key issues in how Kansas has handled the real-estate management of state agencies. The headline figure: in the fiscal year ending July 1, Kansas either owned or leased approximately 4.1 million square feet of office space.
Two-thirds of that space was leased from private owners, and about 32% was held by the state.
Among the findings:
- The Department of Administration had no detailed, written policies for how operating costs are estimated.
- There was no standardised process for how rental rates for agencies were set.
- No single state agency consistently reviewed whether agencies should lease or own, or assessed overall space needs statewide.
- Some lease agreements have terms longer than 10 years, locking in long-term commitments without full comparison to purchase options.
- The audit estimates that terminating all current leases as of July 2025 would cost $16.5 million.
- Among 241 lease agreements, at least 106 run for more than 10 years.
- In the review of 78 state agencies and 524 properties across 102 of 105 counties, 16 locations had unused space, and four had been entirely unoccupied for more than five years.
Details
| Metric | Value/Observation |
|---|---|
| Total office space (owned or leased) | ~ 4.1 million sq. ft. |
| Proportion leased vs. state-owned | ~ 2/3 leased, ~ 32% state-owned |
| Number of agencies reviewed | 78 state agencies |
| Number of properties reviewed | 524 properties |
| Lease agreements evaluated | 241 agreements |
| Leases with duration > 10 years | At least 106 |
| Estimated cost to terminate all leases | ~$ 16.5 million |
| State-owned versus leased cost comparison | Leased buildings had lower reported costs, while data for state-owned buildings was unreliable |
Why This Matters
The management of state office space is more than a logistics challenge — it directly impacts the taxpayer dollars, agency efficiency, and how well state government can operate.
When the audit says there are no formal policies for cost-estimation or rate-setting, it means there is inconsistent treatment of agencies and potentially higher costs for the state.
That the Department of Administration committed to upgrading its systems signals acknowledgement of the problem.
But the structural issues remain: without a formal statewide approach to deciding when to lease versus own, and without reliable data on state-owned building costs, decisions may continue to be opaque.
Unused space and long-term lease agreements suggest inefficiencies: paying for square feet that are empty or locked in at unfavourable rates. Termination costs of $16.5 million show how expensive it could be to unwind sub-optimal arrangements.
What the Department of Administration Is Doing
KDOA officials responded to the audit by promising to:
- Develop and document written policies to guide cost-estimations and rental-rate calculations.
- Improve the integration of budget and accounting systems with real-estate data so that information is reliable.
- Review multiyear lease-rate structures rather than annual resets, bringing state leases more in line with commercial practices.
- Conduct a formal process across agencies to compare leasing versus owning and to assess square-footage requirements.
What Happens Next
State lawmakers and KDOA must work together to implement reforms. The audit recommendation for a comprehensive system upgrade will take time: updating legacy data systems, rewriting policy manuals, and conducting agency-wide reviews of leases and building ownership.
With the cost of leases and unused space still high, accountability pressures are likely to increase from legislators, tax-payer groups and oversight bodies.
The recent audit of Kansas’ state office-space management casts a harsh spotlight on how past decisions have been made — and raises urgent questions about how efficiently taxpayer dollars are being used.
With 4.1 million square feet of space, hundreds of leases and significant termination costs, the stakes are high.
The Department of Administration’s commitments to reform are a necessary first step, but implementing reliable data systems, documented policies and strategic leasing versus owning analyses will determine whether Kansas government can reduce waste, improve efficiency and deliver better value for the public.