Government spends $1.7M to renovate building

SSA leasing new building for twice current rental

SAN ANTONIO - Is it a smart move that benefits those most in need of government services or is it a huge waste of taxpayer money? Those are the questions surrounding the change in location of a social security office in San Antonio.

The Social Security Administration leases 30,000 square feet in a building on the Northwest Side and last June renewed the lease for five years at an annual rent of $500,000.

Two months ago, the agency gave notice to Magi Real Estate that they're moving out.

Michael Shackelford of Magi said the company then did some investigating. "We discovered that SSA and GSA spent about $1.7 million of taxpayer money to renovate an older building," Shackelford said.

Documents obtained by Magi show that before renewing the lease on the Northwest side, the government had already leased 32,000 square feet in a building on San Pedro, agreeing to pay $1.7 million dollars for improvements.

Annual rent for the new building: a little over $1 million.

"So they went from 30,000 to 32,000 (square feet), spent $1.7 million and then increased their rent annually by twice the amount they currently have with us," Shackelford said.

He said the agency could have expanded by up to 6,000 square feet at the Northwest side location.

In a statement the Social Security Administration said the current space is “inadequate from both a size and security standpoint.”

The statement went on to say “we have hired additional staff to bring more timely hearings to claimants, and the current location could not accommodate this need.”

However, a Pennsylvania congressman is now looking into this real estate deal.
Republican Bill Shuster says it was brought to his attention that there are potential issues with the lease and he wants answers.

He was at a hearing on the performance of the General Services Administration, which negotiated the move for the Social Security office.

In a statement the congressman's office said he is “reviewing the mismanagement and wasteful spending” and wants “information on the San Antonio issue to ensure taxpayer dollars are being spent wisely.”

However, both side ask questions about 'political influence,' including questions about the $400,000 commission earned on this move. The move is scheduled to take place at the end of this month.

Here is the full statement from the Social Security Administration:

Political influence should play no role in the building selection process.
In 2005, the Social Security Administration advised the General Services Administration (GSA) that the current space was inadequate from both a size and security standpoint. Our need for space has become more urgent as we have hired additional staff to bring more timely hearings to claimants, and the current location could not accommodate this need.

After a fair and open competitive bidding process, GSA selected new space. GSA is responsible for securing the best possible space and the best possible rate for all federal government agencies, including Social Security. Again, political influence should play no role in this process.

Mark Hinkle
SSA National Press Office

Here is the full statement from the congressman’s office:

It was recently brought to Congressman Shuster’s attention that there were potential issues regarding a GSA lease in San Antonio. At a hearing last week focused on reviewing the mismanagement and wasteful spending of GSA, the Congressman requested additional information on the San Antonio issue to ensure taxpayer dollars are being spent wisely.

Gretchen Gailey
Communications Director, Rep. Bill Shuster

For a list of recent stories Brian Mylar has done, click here.


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