TOPEKA (TNS) — State auditors found that Kansas officials used inconsistent assumptions in a cost estimate for rebuilding the state's oldest and largest prison that favored selling the facility to a private company.
The auditors' report comes as Lansing Correctional Facility — along with El Dorado Correctional Facility — struggles with staffing problems. The Kansas Department of Corrections has said a new prison at Lansing would require fewer corrections officers through consolidation.
The audit released Monday says that KDOC overestimated cost savings under a lease-purchase agreement to rebuild Lansing and that it would be more cost-effective for the state to borrow money by issuing bonds instead. Bonds are frequently used by all levels of government to finance construction.
"These results differ from KDOC's preliminary estimates which were missing key variables and used inconsistent assumptions that tended to favor a lease-purchase option," an audit report said.
Under the auditors' estimates, using bonds for the project could ultimately cost the state $178 million, while a lease purchase would cost up to $206 million.
The agency's estimates didn't include the final payment the state would make to purchase the facility at the end of a lease-purchase agreement, which could be upwards of $35 million. In addition, KDOC estimates didn't adjust future costs to today's dollar amounts, auditors found.
A short letter from Corrections Secretary Joe Norwood in response to the audit says only that the project has not yet completed the request-for-proposal process. The agency hopes a contractor can be selected this fall and that demolition could begin as early as winter, Norwood said previously.
The agency must consult with the Legislative Budget Committee after a proposal is selected. The State Finance Council, which includes lawmakers and the governor, must aprove it.
Norwood attended a presentation of the audit during a legislative committee Monday morning, but left as it concluded, before reporters could ask question.
"I think all along we've been open to either option. We've never tried to weigh one in favor of the other," Todd Fertig, KDOC spokesman, said.
Although El Dorado Correctional Facility has drawn attention in recent weeks for multiple episodes of violence and unrest, both Lansing and El Dorado suffer from staffing shortages and Lansing's staffing problem is getting worse.
As of July 24, Lansing had 116 open positions, up from 105 on July 5.
Meanwhile, El Dorado had 80 vacancies, down from 94.