580:60-1-6. Leasing of non-state owned property 
(a)    Purpose. The purpose of the rules for the leasing of non-state owned property is to provide state agencies with policies and procedures concerning acquisition methods for leasing such space.
(b)    General provisions.
(1)    All leases for space, regardless of size and dollar value, shall be submitted to the Department of Central Services for authorization.
(2)    The Department of Central Services has the responsibility to act as the leasing agent for all state agencies.
(A)    Agencies shall at no time, directly or indirectly contact potential Lessors for the purpose of making oral or written representation, commitments, or agreements before a Space Request is authorized by the Department of Central Services.
(B)    Inquiries made by potential Lessors or their agents are to be referred to the Administrator of State Leasing.
(C)    It is the policy of the Department of Central Services to deal directly with an owner, building manager or primary listing broker of a property.
(D)    An agency shall not, at any time, contract with a broker to secure space on their behalf.
(3)    Any state agency in need of new or additional space shall submit a request from the agency director to the Administrator of State Leasing on the Space Request form.
(4)    No agency shall enter into lease negotiations for new space with any building owner or representative without an approved Space Request in which specific delegation of authority is given from the Department of Central Services.
(5)    Standards for the utilization and allocation of space to state agencies have been adopted by the Department of Central Services and are a part of 580:60-1-4. These standards shall be used as a basis for all planning, leasing of space, or allocation of space.
(6)    The State uses net usable square feet as the standard method of measurement.
(7)    State agencies shall adhere to any ceilings on rental rates as established by the Department of Central Services. "Rental Rate Ceiling" means the net usable square foot rate established by the Department of Central Services as the maximum rental consideration for non-state owned facilities as defined in 580:60-1-2. The ceiling is not to be interpreted as the standard rate, only as the maximum rate. The fair rental prevailing in a geographic area for comparable space may be a factor in the actual rate to be paid by the State.
(A)    On full service leases, which include all utilities except telephones, 5 day per week janitorial services and supplies, and general parking, the rental rate shall not exceed the ceiling rate.
(B)    On net leases, which exclude utilities and/or 5 day per week janitorial services, or general parking, the rate shall not exceed the ceiling rate when rent related expenses are added to the base rate, (i.e. utilities except telephone, 5 day per week janitorial, parking, etc.).
(C)    If a lease rate does not include all or part of the utility expenses, documentation of the most recent 12 month period in which the space was occupied shall be utilized to estimate what the total rent related expenses will be to the agency and shall be considered in both rental negotiations and by the Department of Central Services in evaluation/authorization of the lease.
(D)    On those full service or net leases wherein the janitorial services is to be provided less than five days per week (either at the Lessor or state's expense), the Department of Central Services shall provide the agency with the acceptable rental rate.
(8)    No lease agreement shall contain an open rate including Consumer Price Index, or rental escalation clauses unless authorized by the Department of Central Services.
(9)    State agencies may not pay rental deposits on non-state owned space.
(10)    The State shall not be obligated to pay rent for any period prior to the time that the space is occupied by the State.
(11)    The Department of Central Services shall authorize all increases in rental rates.
(12)    The Administrator of State Leasing shall serve as a contact between the State and the Lessor as needed and upon request by the agency.
(13)    Whenever possible, the State shall lease space requiring as little renovation as possible to accommodate the requesting agency and meet required building codes and specifications. When renovation is necessary, the cost of such renovation shall be borne by the Lessor.
(14)    All acquisitions of non-state owned space being leased which exceed 2,500 square feet shall be obtained through means of public advertisement unless otherwise exempted by the Department of Central Services. Exceptions shall include space requirements declared an emergency by the Department of Central Services and leases of non-state owned space for nominal consideration.
(15)    Non-state owned space may not be occupied or accepted by a state agency for nominal or no consideration without the express written authorization of the Governor.
(16)    A lease shall be entered into with the party who has legal ownership of the property. A broker or property manager cannot be listed as the "Lessor" unless they have legal authority to receive rental payments on behalf of the owner. In such cases, written documentation of the delegation of authority shall be provided by the legal owner to be attached to the lease.
(17)    An agency may not lease space in which a current state employee has a right of ownership, or other financial interest in the property without express written authorization from the Governor.
(18)    An agency may not lease space from a current member of the Oklahoma State Legislature or former member of the Oklahoma State Legislature who has been out of office less than two years.
(19)    The State Leasing forms shall be utilized in all leasing transactions in non-state owned buildings. No provisions to the State Leasing forms may be changed or non-standard terms or conditions added without prior authorization by the Department of Central Services.
(20)    The lease period shall not exceed one twelve month period, however, it does not have to end the last day of the fiscal period if that date would be less than one year.
(21)    The standard Lease Agreement and Renewal Agreement shall allow the agency (Lessee) the right to terminate the lease with thirty days written notification to the Lessor.
(22)    Requests for deviations from the standard lease term may be considered by the Department of Central Services when the agency may show programmatic necessity or financial advantage to be in the best interest of the State that would justify a longer or shorter lease term. The agency shall provide written justification to the Department of Central Services for any variance from the terms of the standard lease.
(23)    All non-state owned space occupied by the State shall meet all applicable federal, state and local laws, codes, ordinances, rules, and regulations pertaining to health, safety, fire, and public welfare. All construction or renovation to space a state agency leases shall comply with applicable professional architectural and engineering laws. A facility shall also meet the criteria for the Standard Space Specifications as approved by the Department of Central Services, with exceptions to be determined at the discretion of the agency.
(24)    The State Fire Marshal's office shall inspect the facility to be leased prior to initial occupancy or renovation to existing space, and/or approve building plans for new construction, for compliance with the Life Safety Code, Fire Prevention Code, and National Fire Protection Association Standards. A written report, or floor plan, signed by the State Fire Marshal shall be obtained. The required inspection and documentation may be delegated at the discretion of the State Fire Marshal to a City Fire Marshal.
(25)    Prior to occupancy of non-state owned space, the proposed space shall be inspected by the State Department of Labor for the presence of friable asbestos containing materials, and written documentation of the inspection shall be obtained. In the event that friable asbestos containing materials are found to be present, the agency shall not be authorized to occupy said space unless the Department of Central Services finds there to be a demonstrated need to do so.
(26)    The Lessor shall adhere to the requirements of the Oklahoma Occupational and Safety Standards Act of 1970.
(27)    The Lessor shall maintain general liability insurance to be no less than $100,000.00 per occurrence at all times during the lease or any renewal periods unless otherwise exempt by the Department of Central Services.
(28)    It is a Lessor's responsibility to ensure that the facility leased by the State complies with the American's with Disabilities Act of 1990 (Public Law 101-336) and all amendments and requirements imposed by the regulations issued pursuant to this act in so far as the requirements of the Act affects the agency.
(c)    Delegation of authority. Department of Central Services' involvement in obtaining space will vary on a case-by-case basis. At the time of the approval of a request for space, the Administrator of State Leasing shall determine what tasks the agency shall assume.
(1)    The Department of Central Services shall review proposals obtained by an agency and review, assist, and make recommendations during the negotiation of lease terms and conditions.
(2)    The Department of Central Services shall specify any delegation of authority to acquire space in writing on the Space Request which is returned to the agency.
(3)    If the agency is not delegated specific authority, the Department of Central Services shall provide the leasing service.
(4)    When the agency is delegated the authority to acquire non-state owned space, the acquisition shall be consistent with existing rules and regulations.
(d)    Leasing of non-state owned space. The acquisition of non-state owned leased space shall be divided into two categories.
(1)    Leases under 2,500 square feet.
(A)    With delegated authority by the Department of Central Services, the agency shall locate potential space from building owners, real estate agencies, or through public advertisement. Where possible, at least three separate sources shall be contacted.
(B)    The agency may be required to solicit for space through public advertisement at the discretion of the Department of Central Services. In such cases, if a lease has not been authorized by the Department of Central Services within six months from the initial date of advertisement, the agency may be required to re-advertise for the space at the discretion of the Department of Central Services.
(C)    The agency shall deal directly with the owner, building manager, or primary listing broker of a property. At no time shall an agency utilize the services of a secondary broker for the acquisition of non-state owned space without specific authorization from the Department of Central Services.
(D)    The agency shall provide the selected prospective Lessor with a copy of the Standard Space Specifications.
(E)    Agencies shall negotiate lease terms consistent with the policies of the Department of Central Services and rental rates equivalent to or below market rates in the locality wherein the space is located. The agency shall also adhere to any rent "ceilings" established by the Department of Central Services. Agencies will be notified by the Department of Central Services as changes in rental rate ceilings occur.
(F)    Upon selection of a space, the agency shall submit the following information to the Administrator of State Leasing:
(i)    A draft copy of the proposed lease which includes:
(I)    Location of proposed space.
(II)    Lessor's name.
(III)    Total net usable square footage of space.
(IV)    Rate per square foot.
(V)    Services to be provided by the Lessor. (i.e. utilities, # of days/week janitorial services, etc.)
(VI)    Renewal options.
(ii)    A copy of the proposed floor plan on an 1/8″ = 1′ or dimensionalized scale.
(G)    A list of all properties considered, their locations, condition, rental rates and reasons for eliminating them in final consideration. shall be provided to the Department of Central Services.
(H)    If more square footage is proposed than has been authorized by the Department of Central Services, an explanation of the difference is required from the agency.
(I)    Upon review and approval of an agency's selection and draft lease by the Department of Central Services, the agency shall proceed with the preparation of the leasing documents.
(J)    At no time shall an agency direct or authorize a potential Lessor to begin remodeling or construction before a lease has been signed by the Department of Central Services.
(K)    An agency shall not take possession of new or additional space until a Notice of Award has been issued by the Department of Central Services unless otherwise approved by the Department of Central Services.
(L)    Agencies who elect to advertise, or are required by the Department of Central Services to advertise, for space shall follow the procedures outlined in 580:60-1-6 (e) and (f).
(2)    Leases of 2,500 square feet or more.
(A)    An agency shall not enter into a lease for 2,500 square feet or more of space in a non-state owned building except upon advertisement for and receipt of competitive proposals.
(B)    Exceptions that are applicable when considering leases of 2,500 square feet or more include:
(i)    The standard renewal of leases unless otherwise determined necessary by the Department of Central Services.
(ii)    Any lease having a term of less than ninety days, or otherwise authorized by the Administrator of State Leasing.
(iii)    Any lease with another government or quasi-government entity for nominal or no consideration. As used herein, "nominal consideration" means consideration for $100.00 or less per year.
(iv)    A modification of a lease of non-state owned space to increase the footage if the modification is based upon the same terms and conditions of the approved lease, provided the total square footage of the lease after modification is less than one half the total of the original square footage.
(v)    If the space is deemed to be a single source (tower sites, boat docks, hangars, etc.).
(vi)    Space needs arising due to an emergency situation or other circumstances that preclude advertising for space may be exempt from these rules upon written statement of circumstances by the agency to the Administrator of State Leasing for recommendation to and consideration of approval by the Director of the Department of Central Services.
(C)    The agency shall follow the procedures set forth in 580:60-1-6 (e), and (f), in regards to the advertisement for and selection of non-state owned space.
(D)    If a lease has not been submitted to and approved by the Department of Central Services within six months from the initial date of advertisement, the agency may be required to re-advertise for the space at the discretion of the Department of Central Services.
(E)    Written notification describing the agency's general space requirements shall be given to appropriate local real estate companies in the applicable geographic area.
(F)    Upon selection of space, the agency shall submit the following to the Administrator of State Leasing:
(i)    A draft copy of the proposed lease which includes:
(I)    Location of proposed space.
(II)    Lessor's name.
(III)    Total net usable square footage of space.
(IV)    Rate per square foot.
(V)    Services to be provided by Lessor. (i.e. utilities, # of days/week janitorial services, etc.)
(VI)    Renewal options.
(ii)    A copy of the proposed floor plan on an 1/8″ = 1′ or dimensionalized scale.
(G)    A list of all properties considered, their locations, condition, rental rates, and reasons for eliminating them in final consideration shall be provided to the Department of Central Services.
(H)    If more square footage is proposed than has been authorized by the Department of Central Services, an explanation of the difference is required.
(I)    Upon review and approval of an agency's selection and draft lease by the Department of Central Services, the agency shall proceed with the final preparation of the leasing documents.
(J)    At no time shall an agency direct or authorize a potential Lessor to begin remodeling or construction before a lease has been signed by the Department of Central Services.
(K)    An agency shall not take possession of new or additional space until the Notice of Award has been issued by the Department of Central Services unless otherwise approved by the Department of Central Services.
(e)    Solicitation for advertisement. When it is determined that an advertisement is required or the Administrator of State Leasing finds that it would be in the best interest of the State to solicit a specific space requirement, the agency shall be advised to prepare and cause the advertisement to be published. The cost of the advertisement shall be borne by the agency soliciting the space.
(1)    The suggested format for advertising may be obtained from the Administrator of State Leasing. Agencies may modify advertisements consistent with actual requirements but shall include, as a minimum, the following:
(A)    Amount of space required.
(B)    City in which space shall be located.
(C)    The agency name.
(D)    The name, address, and telephone number of the agency contact where proposals will be sent.
(E)    Due date of proposals.
(2)    Normally the advertisement shall be placed in no more than two newspapers in the community where the space is needed. The ad shall run for a minimum of two issues, with a week between notices if possible.
(3)    The due date for proposals shall be no less than five days after the last publication. However, the agency may, at its discretion, permit a longer period for response.
(4)    Advertisements concerning space shall be placed in the appropriate section of a newspaper publication.
(f)    Proposals.
(1)    Parties interested in leasing space to the State shall include the following information in their initial proposal:
(A)    Location of space.
(B)    Approximate number of square feet of net usable space available for lease.
(C)    Prospective Lessor's name, address and telephone number.
(2)    Initial proposals shall be accepted from the day the space is first advertised until 5:00 p.m. on the specified due date. Upon receipt, proposals should be stamped with the date received.
(A)    Initial proposals received after the time and date set for receipt of offers shall be considered late. However they may be considered with mutual agreement between the agency and the Administrator of State Leasing if it is determined to be in the best interest of the agency.
(B)    A modification of a proposal which makes its terms more favorable to the State shall be considered at any time it is received.
(3)    When less than three responsible offers are received, the agency may, without re-advertisement, extend the date and solicit additional offers by any method approved by the Administrator of State Leasing to ensure adequate competition.
(4)    In each request for proposal, the State shall reserve the right to amend the specifications at any time prior to award of a lease.
(5)    The State reserves the right to reject any and all offers, to request additional information, to waive all formalities in proposals, and to negotiate with any offeror.
(6)    There shall be no public opening or review of proposals in response to the advertisement for proposals.
(7)    The State shall not be responsible for any costs incurred in the preparation and submission of proposals in response to solicitation for space by a state agency.
(8)    After the proposals have been reviewed, the agency shall inspect the properties to determine suitability of each space to the specific needs of the agency. The agency may eliminate from further consideration those properties which do not meet the basic requirements, such as location or square footage.
(9)    The agency shall provide each viable prospective Lessor with a copy of the Standard Space Specifications.
(10)    As a result of the on-site inspection, with the assistance from the Administrator of State Leasing or other agency staff, the agency will prepare a preliminary floor plan on that property initially determined to best meet the needs of the agency. This information shall be submitted to the respondent in order to obtain a final annual lease price and lease term.
(11)    A final proposal may, at the agency's discretion, be required from the selected vendor on the Standard Proposal Form as developed and approved by the Department of Central Services.
(12)    All proposals shall be kept confidential and shall be released only to state employees having a need for the information until such time as an Award of Contract has been issued.
(g)    Specifications.
(1)    Specifications shall be followed by the agency leasing a non-state owned facility in general terms with exceptions to be determined at the discretion of the agency. They shall afford each viable prospective Lessor interested in submitting a serious proposal with knowledge of the agency's space requirements. In specific instances it may, on occasion, be necessary to issue additional specifications due to some unique requirements of a particular agency.
(2)    Cost of all construction or renovation to meet the requirements of the specifications or remodeling as determined necessary by the agency shall be borne by the Lessor.
(h)    Evaluation of proposals.
(1)    It is recommended that the agency, in conjunction with preparing specifications, develop evaluation criteria. The criteria items most significant to the agency's needs should bear the highest consideration. Rental, the cost of relocation, if any, consolidation of activities, if desirable, and any other factors deemed necessary should be weighed.
(2)    The evaluation and selection of the best and most economical proposal shall be made by the agency and submitted to the Department of Central Services for final authorization.
(3)    Criteria to be used in the evaluation of space will include, but not be limited to, the following:
(A)    The comparison of the square footage required to satisfy the agency's needs with the square footage available in a given facility. Square footage required shall be determined according to 580:60-1-4.
(B)    An analysis of the quality and condition of building facilities such as elevators, toilets, parking, public traffic areas, and location relative to associated agencies.
(C)    The cost of occupying the space for the term of the lease should include the following factors:
(i)    Square footage cost of the proposed space.
(ii)    Estimated cost of utilities, if not included in the proposed rate.
(iii)    Cost of custodial services, if not included in the proposed rate.
(iv)    Cost of parking, if not included in the proposed rate.
(D)    Time factors affecting need for the space.
(E)    Capability to accommodate future needs of the agency for space and services.
(F)    The building's compliance and/or the owner's willingness to assure that the building complies with the requirements of the Americans with Disabilities Act.
(G)    Availability of adequate public and client access through public transportation and parking.
(H)    Space efficiency and effectiveness for the agency's purpose.
(4)    Documentation to support the selection shall be provided to the Department of Central Services. Such documentation shall include the following:
(A)    A copy of the advertisement.
(B)    A synopsis of the agency's findings for each proposal or site considered.
(5)    The agency shall notify, in writing, each party who submitted a proposal regarding a decision on the space. The agency is not, however, obligated to provide the party with a specific reason for rejection of a proposed site.
(6)    In the event either no proposal or no acceptable proposal is received after advertising, the agency may negotiate in the open market for leasing of the needed space after obtaining authorization from the Department of Central Services.
(7)    The agency may reject all sites; however, specific reasons for rejecting proposals shall be provided in writing to the Department of Central Services. The Administrator of State Leasing shall then determine whether the space requirement should be re-advertised or whether other acquisition methods are required. Reasons for rejection of proposals include, but are not limited to:
(A)    Rents exceed available funds and it would not be appropriate to adjust the amount of space to come within available funds.
(B)    There is reason to believe that the proposals may not have been independently arrived at, may have been collusive, or may have been submitted in bad faith.
(C)    All otherwise acceptable proposals are at unreasonable rents.
(D)    No proposal met or could meet the specified requirements of the agency.
(i)    Negotiations of non-state owned space.
(1)    Negotiations may be conducted with the offeror of each acceptable site as follows:
(A)    Each responsible offeror of a viable facility may be individually contacted and apprised of the weak and strong points of his offer and any changes or revisions to the specifications.
(B)    A written best and final offer may be solicited from each viable party with a specific due date.
(2)    The agency shall negotiate lease terms consistent with the policies of the Department of Central Services to include any rent"ceiling" established by the Department of Central Services.
(3)    When negotiations have produced final offers for one or more sites with equitable rental rates, the agency will proceed with the remaining requirements to conclude the transaction.
(j)    Preparation of lease agreement of non-state owned space. Once space has been selected and exact terms and conditions of a lease have been approved by the Department of Central Services, the agency shall prepare for signature the Lease Agreement and obtain all requested documentation in accordance with 580:60-1-7.
(k)    Lease renewal of non-state owned space. The agency shall begin to evaluate its space needs no less than three months prior to the expiration of a lease term.
(1)    The condition of space which has been occupied by an agency shall be evaluated and required improvements discussed with a Lessor prior to initiating a Renewal Lease Agreement.
(A)    Any requests made by the agency to the Lessor for alterations related to general maintenance, upkeep, or repair, as designated in the original Lease Agreement, may be included as an "Attachment to the Lease Agreement" to specify the action required, dates of completion, and signature of both the Lessor and the agency.
(B)    General maintenance and repairs shall not justify a rental increase.
(C)    A change in the vendor, square footage, or rental rate shall not be made in a renewal lease agreement.
(2)    If the agency intends to exercise a renewal option at the same terms and conditions set forth in the existing lease, the lease shall be renewed without pre-authorization from the Administrator of State Leasing.
(A)    The agency shall submit the Standard Renewal Lease Agreement and other required documents to the Administrator of State Leasing for signature.
(B)    If any of the required documents are incomplete, the renewal shall be returned to the agency for corrective action prior to final execution.
(3)    When an agency has been at its present location over four years, and every fourth year thereafter, it may be required to justify continued need of the space by submitting a Space Request to the Administrator of State Leasing. The agency shall be notified if such action is necessary.
(A)    The Request shall be completed in accordance with the procedures outlined in 580:60-1-5.
(B)    The Administrator of State Leasing shall review the agency's staffing, specialized requirements and program functions and shall notify the agency of the action or amount of space to be authorized in accordance with its current needs. Relocation will be considered only if it is determined to be in the best interest of the State.
(4)    The agency shall advise the Administrator of State Leasing immediately if a Lessor requests a rental increase or is seeking termination of the contract at the end of the current lease term. The Administrator of State Leasing shall provide assistance to the agency in negotiating a new lease, or shall determine if it is necessary for the agency to seek new space.
[Source: Added at 16 Ok Reg 3125, eff 7-12-99]