Emails from the North Dakota attorney general’s office show months of correspondence about changes for a leased building that generated a $1.8 million construction cost overrun last year.
The emails obtained by the Tribune show numerous office division directors discussed what they wanted in the building.
New Attorney General Drew Wrigley in June, citing the need for transparency, disclosed the cost overrun to the Legislature’s Budget Section, which tasked two interim legislative committees to investigate. The overrun predates Wrigley’s tenure, occurring when Wayne Stenehjem was attorney general.
The Tribune requested the emails related to the building and also toured the location, which is two office areas connected by a passage and containing a garage. The interior is that of any ordinary, nondescript office building — filled with work cubicles, shelving stacked with files, storage areas and hallways. Emails show the move to the building was to consolidate divisions of the Attorney General’s Office from three locations in Bismarck.
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The Attorney General’s Office comprises the Bureau of Criminal Investigation, Lottery, Consumer Protection and Antitrust, Fire Marshal, Criminal Justice Information Sharing and Information Technology.
Plans began in earnest in early 2020, amid the early months of the coronavirus pandemic. Division directors corresponded about proposals and changes for the building, though it’s unclear how much was ultimately approved and incorporated into the building.
Notably, the emails don’t paint a full picture of office communications related to the building owned by Bismarck-based Stealth Properties LLC, at 1720 Burlington Drive in south Bismarck.
Former attorney general spokeswoman Liz Brocker directed the deletion of the email accounts of Stenehjem, who died Jan. 28, and his former deputy, Troy Seibel, who resigned in March as Wrigley, appointed in February, intended to appoint his own No. 2.
“We want to make sure no one has an opportunity to make an Open Record request for his emails, especially as he kept EVERYTHING,” Brocker emailed the office’s information technology/criminal justice information services director the day after Stenehjem’s death.
Brocker resigned July 15 soon after Wrigley and Deputy Attorney General Claire Ness learned of her actions detailed in the emails that came out in the Tribune’s records request.
The Tribune reviewed more than 2,300 pages of emails related to the building. Though incomplete, they shed some light on how the overrun played out and make for a clearer timeline.
Cost overrun
Records in the emails indicate the “overage identified by Parkway Property Management” comprised $914,150 for a building addition and $828,060 for the remodel.
The building’s property manager told the Tribune that Stenehjem and Seibel were aware from a meeting in early 2021 that there would be a cost overrun, but it wasn’t until subcontractors submitted final billing around May or June of that year that the full amount became clear.
Wrigley has said Stenehjem and Seibel were told of the issue in January 2021 but didn’t inform budget staff until June 2021.
Seibel was a point of contact on the project and said he kept up to date on costs. He said the property developer informed him of the overrun but couldn’t immediately provide the amount.
Seibel said he notified the attorney general’s finance department as soon as he first learned of the total cost overrun in May or June 2021, an overage he attributed to unforeseen material costs due to supply shortages.
Emails show Parkway Property Management Owner C.J. Schorsch sent Seibel a spreadsheet of the construction cost overages on June 25, 2021.
Three days later, Seibel emailed the office’s finance director, asking how much could be paid out of money remaining from the ending budget cycle. The state’s 2019-21 budget cycle ended two days later, June 30, 2021.
In July 2021, the office used $1.4 million from its 2019-21 budget and rolled the remaining $400,000 into a new rental rate of the lease to cover the overrun.
Emails from August 2021 indicate Seibel sought documentation from Schorsch and BCI Chief Agent Steve Harstad related to the overages “for auditing purposes.”
“Specifically, we need documentation about why the costs increased (i.e. change orders, increased material/labor costs because of COVID, etc.),” Seibel wrote. “It does not have to be very formal. It could be emails, or a short memo/note about why the costs were incurred so we have documentation in our files.”
Change orders
Change orders for a garage and a reconfigured heating, ventilation and air conditioning unit affected costs, Seibel said in June. He did not respond to a phone message seeking comment for this story.
Schorsch told the Legislative Audit and Fiscal Review Committee in June that the “build-to-suit” project was punctuated by coronavirus pandemic delays, overages and change orders.
“It was a very challenging time to get any product and completed on a timely manner, and it definitely added to the cost, the inability to get supplies,” he told the Tribune.
The change orders “were to make the building more user-friendly” but involved many electrical changes such as moving panels routed underground, he said. Bulletproofing also was expensive, he said.
“From the original scope of work, there were definitely some changes that added to that, whether it was electrical, the additional space that was needed, but I wouldn’t say it was negligence on anybody’s part,” Schorsch said of the cost overrun.
Emails indicate delays for door frames and exterior siding corners in May 2021.
A major cost was an additional bay to the garage/shop of the building added to the south end of the original brick structure, which also houses state Health Department offices.
The shop area comprises a laundry and shower for the Fire Marshal’s Office, a weapons vault, evidence rooms, and a two-stall garage containing a BCI truck.
North Dakota Bureau of Criminal Investigation Director Lonnie Grabowska walks in the large two-stall garage used by BCI and the state Fire Marshal’s Office in a leased building in south Bismarck.
Records indicate Seibel approved $380,160 for the extra garage space, and “AG paid $150,000 for upgrade to HVAC system.”
Directors’ discussion
Seibel was the point person for the building. He proposed an initial building drawing to division directors in February 2020, and confirmed the move in May of that year: “We are moving forward with the office space.”
Emails show that division directors discussed a number of changes over a span of more than a year, including:
- Locker room and shower room for deputy fire marshals
- Bulletproof glass for the Lottery and Consumer Protection & Antitrust Division
- Garage expansion
- Power outlets and backing for TVs in each office
- Network jack locations for all offices along the building’s perimeter
- Wall insulation to reduce sound travel
- Interior and exterior cameras
- Second floor on the building addition, “if reasonable cost”
- Card access to doors
- Raised flooring in server room
- Utility sink and water connection for shop drain
- Layout revisions
At one point, in September 2020, Seibel admonished three division directors, telling them to direct “additional requests for changes to the new building” to him.
“Please do not contact either C.J. or the architect directly,” he wrote. “Every time the architect is contacted for minor things (like changing the way a door opens, etc.), we are getting charged approximately $150. Minor things can always be altered later on, they don’t need to be part of the formal plans for getting permits, beginning construction, etc.”
State Fire Marshal Doug Nelson pointed out several concerns in the initial plans, including no dedicated spaces for evidence storage, file/equipment storage, vehicle/equipment maintenance or gear/uniform cleaning.
He wrote, “It would be nice to incorporate a small locker room/shower room” for deputy fire marshals to remove toxins encountered during investigations.
“I do realize this is a wish and not a need,” he wrote to Seibel.
The fire marshal at the time leased footage or borrowed space from BCI, used local fire departments’ space for cleaning and had no place for showering or changing clothes, according to the emails.
Former State Lottery Director Randy Miller and Consumer Protection & Antitrust Division Director Parrell Grossman brought up security measures in August 2020 emails to Seibel.
Consumer Protection & Antitrust Division Director Parrell Grossman stands in the division’s storage room in a south Bismarck building leased by the Attorney General’s Office.
Miller wrote, “Times have changed over the last 10+ years when dealing with the public. With the new construction, now would be an opportune time to implement this additional safety/security measure.” He noted other lottery offices around the U.S. have bulletproof glass.
Seibel responded, “We definitely can discuss. Obviously one issue will be cost.”
BCI Director Lonnie Grabowska emailed division directors and officials in August 2020 about his meeting with Seibel to discuss the size of the garage addition.
“Troy is deciding on the size of the garage based on increased cost. I advocated heavily to have Troy allow the full garage expansion so we have the most space possible for the future,” Grabowska wrote.
Other emails suggest apparent frustration among division directors related to the building.
Medicaid Fraud Control Unit Director Marina Spahr wrote to two division directors in October 2020 about changes to the building: “For now we are not going to contact Troy. It’s his move. If he doesn’t pay enough attention to the building or our plans and suggestions then he will paint himself in a corner. That may benefit us in the long run (hopefully).”
Miller, the former state Lottery director, emailed Lottery employees in January 2021: “As I have mentioned a number of times to you, there has been very little communication with Division Directors in this relocation process. I wanted to get this out to you asap, so we can provide feedback to Troy before construction is too far along and we can’t make any recommended changes.”
The Legislative Audit & Fiscal Review Committee met June 29 and voted unanimously to direct State Auditor Josh Gallion to work with the Attorney General’s Office to gather and review documentation and other information related to the lease agreement and remodeling and construction of the building, and report back in September.
The interim Government Administration Committee, also tasked with probing the matter, meets from 10 a.m. to 4 p.m. Wednesday.
Reach Jack Dura at 701-250-8225 or [email protected].
