Auditor General Jack Wagner Will Review State's Agreement to Sell Pittsburgh State...

Auditor General Jack Wagner Will Review State's Agreement to Sell Pittsburgh
State Office Building

PITTSBURGH, March 25 /PRNewswire-USNewswire/ -- Auditor General Jack Wagner
said today that he was reviewing the Pennsylvania Department of General
Service's agreement to sell the State Office Building here for $4.6 million
because the transaction amounted to a "fire sale."

DGS said on Tuesday that it was selling the 16-story structure to River Vue
Associates LP of Canonsburg, Washington County.

In a letter hand-delivered today to DGS Secretary James Creedon, Wagner said
that the Department of the Auditor General's Office of Special Investigations
would be seeking all available information pertaining to the sale, including
lease terms and associated build-out costs at all privately owned buildings
where DGS has relocated, or plans to relocate, 800 workers from at least 22
state agencies.

"I continue to believe this is the worst possible deal for the taxpayers of
Pennsylvania," Wagner said. "It makes no sense for the commonwealth to sell
this prized asset -- the signature building of state government in Western
Pennsylvania -- for the lowest possible price during the most depressed
real-estate market in decades."

Wagner asked DGS a month ago to take the State Office Building off the market
until economic conditions improve, after another developer, the Buncher Co.,
withdrew its bid of $4.5 million. As an alternative to selling the building,
Wagner suggested that the state investigate the possibility of using federal
funds for green technology to rehabilitate the 52-year-old structure.

The 274,000-square-foot building occupies a prime, 1.3-acre location in
downtown Pittsburgh, at the entrance to Point State Park, and offers sweeping
views of the confluence of Pittsburgh's three rivers. Along with the Gateway
Center complex, the State Office Building is a symbol of the post-Word War II
downtown renaissance envisioned by David L. Lawrence, the late mayor of
Pittsburgh, who served as Pennsylvania governor from 1959-63.

"The land alone is worth more than the sale price," Wagner said. He noted that
the state has agreed to purchase the City of Pittsburgh's Municipal Courts
Building, which is one-fifth the size of the State Office Building and is
situated in a less desirable location, under the Liberty Bridge and next to
the Allegheny County Jail, for $9 million.

The State Office Building sale is a bad deal, Wagner said, because there would
not be enough profits from the sale to offset moving expenses and pay for the
first year of leases at multiple locations in downtown Pittsburgh, saddling
taxpayers with an additional spending burden.

"During these difficult economic times, with the state facing
multibillion-dollar deficits for the next few years, we should not be saddling
hard-working Pennsylvania residents with additional financial burdens they
cannot afford," Wagner said.

"In addition to being financially wasteful, it would be ludicrous for
Secretary Creedon to decentralize state offices in Pittsburgh while other
government agencies are moving to centralize other functions in order to save
money," Wagner said. "Under the terms of this sale, the only certain winners
are the buyer of the building and the landlords of the office space where
state employees will be relocated."

Auditor General Jack Wagner is the commonwealth's elected independent fiscal
watchdog. To learn more about the Department of the Auditor General, taxpayers
are encouraged to visit the department's website at
www.auditorgen.state.pa.us.

SOURCE Pennsylvania Department of the Auditor General

Steve Halvonik of the Pennsylvania Department of the Auditor General,
+1-717-787-1381