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KY: SGI = $$$

KY: SGI = $$$

by Joe Arnold


Posted on June 17, 2011 at 12:47 AM

The Beshear administration says it is evidence of further efficiency successes from the Smart Government Initiative (SGI).

Over the last 18 months, Kentucky has added $7.45 million to the state treasury by selling off surplus land.

The Lexington Herald-Leader's Beth Musgrave reports that:

Gov. Steve Beshear (D) announced Thursday that the state sold a 2.1-acre parcel to Franklin County for about $78,750, the appraised value. That sale brings the total amount of money generated by selling state property to $7.45 million.



News Release

Beshear administration sells over $7 million in state-owned real estate
Reducing property inventory is a part of ‘Smart Government Initiative’ to save tax dollars

FRANKFORT, Ky. (June 16, 2011) – Governor Steve Beshear today announced that during his administration the Commonwealth has generated $7.45 million in revenue by selling surplus state-owned real estate – evidence of further efficiency successes resulting from his ongoing Smart Government Initiative (SGI).  

Beshear’s administration has sold 12 properties in six counties, along with various right-of-way sales, to reach the almost $7.5 million in revenue.   

The Governor used the recent sale of a lot in Frankfort to the Franklin County Fiscal Court as an example of his continued efforts to examine state government operations to extend and expand efficiency efforts to save money and state resources. 

“During these tough times, it is even more critical that every taxpayer dollar is used wisely and efficiently,” said Gov. Beshear. “Our initiative to sell off unnecessary state property, including real estate, is critical to preserving our limited resources to protect our top priorities, like schools, public safety and economic development efforts.”

In Frankfort, a vacant 2.07 acre lot at 501 Holmes Street is being sold to Franklin County for $78,750, the appraised value. The proceeds from the sale will be returned to the state’s General Fund.

“Franklin County Fiscal Court appreciates the efforts of Gov. Beshear in facilitating the purchase of the surplus state property,” said Ted Collins, Franklin County Judge-Executive. “Once we were made aware of the availability of the property, we knew it would be an ideal location for staging materials and equipment for the Judicial Center Project.”

The vacant lot had previously been owned by the Finance and Administration Cabinet.  Before it was razed in 1999, it had been used by the Division of Surplus Property, and has been green space since that time. Before the Commonwealth publicly sells any surplus real estate, the opportunity to purchase is first offered to state and local agencies. 

“The community really benefits when the Commonwealth can partner with local governments in land transactions as we have done in this instance,” said Lori Flanery, secretary of the Finance and Administration Cabinet. “The state is able to reduce costs by letting go of nonessential property while the purchasing agency can secure new space for improvements or expansion at a fair market price.” 

Gov. Beshear launched SGI in January 2010 to conduct a detailed review of state government with a specific focus on property management, delivery of business solutions, and reviews of information technology, state vehicles, postal services and procurement services.

The Commonwealth has sold surplus real and personal property online and through live and sealed-bid auctions for several years, and its efforts have been heightened through SGI. In May 2011, Gov. Beshear announced the sale of two surplus state-owned aircraft, generating more than $230,000 for the General Fund. 

Since the beginning of SGI, the Office of Procurement Services estimates a savings of $7.2 million through contract renegotiations and rebidding. In total, General Fund contract spending has decreased by $75 million since FY 09.    

Through SGI, ongoing efforts to consolidate offices within individual agencies, as well as across state government have already saved the Commonwealth more than $353,000. 

Private landlords who lease property to the state have been asked to voluntarily reduce their rent, saving the state more than $943,000 annually to date. 

In addition, the state realized a savings of $1.1 million by redistributing the assignment of or selling state-owned vehicles. The number of permanently assigned vehicles has been reduced by 17.2 percent since 2008 and the overall number of vehicles maintained by the Division of Fleet Management has been reduced by 8.8 percent since 2008.