Cover Letter to Governor Geringer

Executive Summary

Introduction

Background

Finding and Recommendation

Conclusion

Over the years, Wyoming state agencies have provided housing for their employees at various locations throughout the state for a variety of purposes. Other than for the Governor's residence, statutes provide no explicit authority for this practice. No single entity in state government tracks the amount and value of the housing provided, and no single agency has the authority to monitor or manage state housing. Thus, to conduct this review, we surveyed state agencies that provide housing and then analyzed their self-reported data.

Eight agencies and the University of Wyoming reported 282 dwellings of various structural types, plus 29 trailer pads. The total replacement value of this housing is $19 million. Of these 282 dwellings, 201, or nearly three-fourths, were reported as currently occupied year-round by state employees. Agencies reported the remaining dwellings as seasonal (23 percent) or vacant (6 percent).

In fiscal year 1996, the state spent $805,000 to provide capital improvements, maintenance, and utilities for employee housing. With an exception at only one dwelling, agencies have individually developed the practice of not charging employees rent.

The three agencies engaged for this report are the ones that own most of the dwellings: The Game and Fish Department owns 165 (59 percent) dwellings, the Department of Transportation owns 36 (13 percent) dwellings, and the Department of Commerce, Division of State Parks and Historic Sites owns or leases 31 (11 percent) dwellings. The University reported some employee housing, as did other state agencies: Health, Corrections, Family Services, Military, and Agriculture.

The purposes for agencies to provide employees housing are diverse. Game and Fish provides housing to staff at research and breeding facilities and to game wardens. It also has seasonal housing for field work in remote locations. Transportation provides housing at sites it considers remote for personnel involved in highway maintenance and snow removal, and for some highway patrol officers. The primary purpose of Commerce's on-site employee housing is the protection of natural and historic resources.

With no overall guidance or leadership in managing agency-provided housing, agencies have developed their own approaches. The result of this varied management is that not all agencies have addressed four broad policy areas. These four areas warrant consistent attention for the protection of both the employee-occupants and the state.

The Internal Revenue Service (IRS) has a three-fold test that determines whether or not housing provided to employees is taxable as compensation. Housing is excluded from compensation if it is for the employer's convenience, but only if the employee must accept lodging on the employer's premises as a condition of employment. Providing and accepting housing that does not meet the test could leave employers and employees liable for unpaid taxes. No state agencies have indicated that the housing they provide employees is taxable, yet we found practices and policies that appear inconsistent with the IRS regulations.

By not clearly establishing housing as a convenience of the employer in policies, agencies can become involved in disputes with employees who view their housing differently. Agencies have faced litigation and grievances when they eliminated housing or did not provide it to all employees of certain job classifications. Further, agency policies lack provisions that would guide them in making operational changes that would promote efficiency but which would affect employee-occupants. Without such provisions, agencies typically refrain from making changes until housing is vacant.

The state claims immunity from liability in situations related to employees' use of state-owned housing, unless negligence on behalf of a state employee is involved. Although this immunity has significant implications for the families of employees assigned to housing, only two agencies have made some attempt to convey this information to the employee-occupants. However, the state does risk liability if its housing is negligently maintained. We found that agency maintenance approaches vary, and that no efforts have been made to establish uniform basic inspections to address health and safety hazards in dwellings. Given that most agency housing is at least 30 years old, these potential hazards should be addressed.

The majority of dwellings acquired since 1990 have been purchased through informal procedures and without involvement in the legislative budget process. The Game and Fish Department has purchased 17 dwellings in the last seven years, ten for use as warden stations. However, we found that formal selection criteria were not established to guide these purchases. Further, we found a wide range of acquisition prices for these dwellings that was not fully explained by local housing markets. Without criteria, these is no guarantee that Game and Fish is acquiring comparable properties in different communities for warden stations.

There is no statute or statewide policy to guide the state entities that provide housing. In a matter with potential for tax consequences and other liabilities, clear legislative policy is essential. The Legislature could initiate action by appointing a committee to make overall policy recommendations regarding housing. Members of the committee might include representatives of those agencies providing housing, as well as others with related expertise who could contribute to policy development.

W.S. 28-8-107(b) authorizes the Legislative Service Office to conduct program evaluation and performance audits. Generally, the purpose of such research is to provide a base of knowledge from which policymakers can make informed decisions.

In February 1997, the Management Audit Committee requested a program evaluation of agency-provided housing. Several agencies in state government have traditionally provided housing to some of their employees, for a variety of purposes. The Committee asked for information about the policies and practices of the three agencies with the most extensive housing inventories: the departments of Commerce, Game and Fish, and Transportation. We also obtained information from the Departments of Corrections, Health, Agriculture, Military, and Family Services, and from the University of Wyoming, all of which have lesser amounts of housing.

The research in this report centered around the following questions:

• How many agencies own housing, and how much?
• What is the value of this housing and how much does it cost to maintain?
• What are the purposes for providing housing?
• What policies guide the agencies’ management of this housing?
• What risks are associated with providing this housing?

Our research also identified a variety of other state-owned and state-operated facilities that can be characterized as having special purposes. These widely diverse facilities exist to fulfill unique purposes and, incidentally, have living quarters associated with them. In this category are a "warden’s house" at the Wyoming Territorial Park, a recreation camp, a modular unit that temporarily houses researchers at a mountain-top observatory, two ranches, and several other specialty properties. We did not include these buildings, or the Governor’s residence (required by W.S. 9-1-213), in our overall analysis of housing provided to state employees.

This evaluation was conducted according to statutory requirements and professional standards and methods for governmental audits. We conducted our research during May and June 1997. To develop the aggregated data about the state’s housing, we surveyed agencies we had identified as having housing through a preliminary telephone survey and a review of the listing of properties insured by the state. In addition, we reviewed relevant policies, statutes, regulations, and studies conducted by other states and the federal government.

We also reviewed position description questionnaires (PDQs) and position vacancy announcements for positions that encompassed housing. We interviewed state officials from all agencies providing housing, and from other agencies with general administrative purviews that included these agencies. Finally, we contacted officials in other states to determine their practices and policies with respect to housing.

The Legislative Service Office expresses appreciation to the individuals who assisted in our research, and especially to the staff of the three engaged agencies, the departments of Transportation, Game and Fish, and Commerce, Division of State Parks and Historic Sites.

Over the years, Wyoming state agencies have provided housing for their employees at various locations throughout the state and for a variety of purposes. Aside from the Governor’s residence, statutes contain no explicit authority for agencies to provide housing for employees. We found that the eight state agencies and the University of Wyoming that provide housing have inferred the authority through their general statutory authorities to carry out programs.

The locations for housing vary according to agency purposes. Some, such as state park and historic site housing, is located in remote areas where agencies have determined that it is necessary to station personnel to protect state resources. Others, such as dwellings for game wardens, prison wardens, and the state fair manager, are situated in towns or communities or at state institutions where agencies have stationed personnel for operational reasons. In all, there is state housing in every county in the state.

This evaluation focuses on areas that pertain to the management of all agency housing and in which problems could create risk for the state. Our research indicates that the three agencies with the most housing, the departments of Commerce, Game and Fish, and Transportation, are committed to maintaining their housing, believing that it is critical to their missions. We have not evaluated the rationale that these or other agencies stated as reasons for providing housing.

To conduct this analysis, it was necessary to develop comprehensive information about the state’s employee housing. No single agency has been vested with authority to monitor and manage state housing. Consequently, such information did not exist with any one entity in state government. We relied on self-reported data from the agencies, gathered through a survey we developed and whose results we clarified through interviews with agency officials.

Since this information has not previously been gathered and analyzed, we present the following tables and graphs as an overall view of the state’s housing. The source for all figures presented in this report is LSO analysis of the June 1997 survey on agency-provided housing.

Nine entities (the three engaged agencies plus six others) reported housing totaling 282 dwellings of all structural types, including houses, apartments, mobile homes, and cabins. Of these 282 dwellings, 201, or 71 percent, were reported as currently occupied on a year-round basis by state employees. Of the remaining dwellings, 23 percent were reported as seasonal, and six percent were reported as currently vacant. Figure 1 shows the distribution by agency of all dwellings and year-round occupied dwellings.

*Does not include trailer pads.

Of the 201 occupied year-round dwellings, the Game and Fish Department owns 97, or nearly one-half, the Department of Transportation owns 34, and the Department of Commerce owns 26. Transportation also reported owning 29 trailer pads. These are the concrete foundations and utility hookups available for employees’ personally-owned trailers. Trailer pads are treated separately in this report since they are not technically dwellings.

More than two hundred of the dwellings owned by the state are houses, the remainder being cabins, mobile homes, and apartments. All 36 dwellings included under the category of cabins are owned by Game and Fish, which describes them as "patrol cabins" available for seasonal use by employees. Figure 2 shows the types of structures included in the 282 dwellings and also 29 trailer pads.

For state dwellings, agencies reported a total replacement value of $19 million. Replacement value is based on the latest appraisal value and represents an estimate of what it would cost to replace the structure if it were destroyed. This figure is calculated by the Department of Administration and Information, Insurance Division, and by the University risk manager for that institution’s housing. Replacement value does not necessarily correspond to market value, due to the variability of the housing market.

*Three dwellings had no replacement value separate from the entire facility.

Agencies acquired 61 percent of the dwellings managed as housing before 1970, and approximately half of the remainder in the 1980s. Some dwellings already existed on properties that the state acquired during that time, while others were added to meet specific needs.

Assuming that acquisition dates approximate the ages of the dwellings, most are at least 30 years old. Figure 4 shows the decades in which agencies acquired dwellings.

Of the 78 dwellings acquired since 1980, Game and Fish owns more than two-thirds, or 69 percent, Commerce owns 23 percent, and other agencies hold the remaining eight percent. Transportation has not acquired any new dwellings since the beginning of the 1980s.

Note: Trailer pads excluded because they lack an acquisition date.

In fiscal year 1996, the state spent $805,000 to provide utilities and capital improvements/maintenance for employee housing. Because not all agencies reported separate costs for capital improvements and maintenance, we combined the amounts into one category. Figure 5 lists these expenses for fiscal years 1994 through 1996.

Most agencies providing housing also provide utilities. The total reported cost for utilities in fiscal year 1996 was $396,290, as noted in Figure 6. Because not all dwellings are metered separately, agencies sometimes estimated costs or reported the utilities for entire sites.

*Pays utilities at one occupied dwelling and others only if they are vacant.

Game and Fish also paid $25,425 in property taxes in 1996 to comply with W.S. 39-2-105, which imposes a fair market tax on real properties owned by the Commission and not used for wildlife management.

Our survey revealed that, with one exception, employees living in agency housing do not pay rent. The one employee paying rent lives on the grounds of the State Training School in Lander and reportedly pays $100 a month. In addition, University officials reported three houses located on separate agriculture research stations that non-employees rent for undisclosed amounts. A building at the Retirement Center in Basin, which had been used as employee housing, is currently leased to the Wyoming State Hospital for $100 a day for use by clients in an adult transition program.

In our research, we reviewed how other states and the National Park Service handle rent for their housing. Typical of these practices is Oregon’s law, which requires rent based on fair market value, sets reduction factors for conditions such as isolation and lack of privacy, and gives agencies the discretion to apply those factors. Such reduction factors often combine to reduce the rent to a minimal fee or zero. Montana uses an elaborate eight-class scheme that applies minimal rental and utility fees depending upon an employee’s responsibilities. Under this scheme, some classes pay neither rent nor utilities, and the highest rent is $56 per month, plus utilities.

The three agencies engaged for this report are those with the most employee housing. Information about the housing owned by these agencies is presented in the remainder of this background section, and further detail is presented in Appendix A.

The Game and Fish Department holds over half of the state’s dwellings, representing a replacement value of nearly $10 million. Nearly 60 percent of the department’s housing, or 97 dwellings, is for year-round housing to employees. With 314 full-time employees as of July 1996, almost one-third of Game and Fish full-time employees are housed year-round.

The department also requires all 52 district game wardens to live in stations in communities throughout the state. These stations are signed and telephone numbers are listed as public offices. Officials note that warden stations are important in implementing the department’s philosophy to maintain personal contact with the public, and to enable the wardens to perform responsibilities related to wildlife management and damage control, as well as law enforcement. The warden station establishes a wildlife management presence in a community, and serves as a place for the public to contact wardens and obtain information or services. In addition, the stations store equipment such as snow machines, boats, fencing, and horse trailers.

Warden stations, which represent one-fourth of all year-round state employee housing, have been the subject of internal review on more than one occasion, yet no actions have been taken to modify the requirement. Most Game and Fish officials we interviewed acknowledged it is a difficult issue for either management or the Game and Fish Commission to address or change. Most recently, an internal department committee recommended elimination, through attrition, of those warden stations in communities with regional department offices. However, that recommendation was not adopted by high level department officials and therefore was not forwarded to the Commission.

Others of these seasonally-used structures are more habitable, including some houses acquired when the department purchased ranches for wildlife habitat. The department phased out employee housing on these properties in the late 1980s, but the dwellings still exist. Department officials said that some will be retained for field work, and others have been identified as surplus in a report that details the department’s response to a previous LSO report on land acquisition. Officials said this report is pending the Commission’s action.

Figure 7 shows the total number of Game and Fish dwellings, combined fiscal year 1996 costs for utilities and capital improvements/ maintenance, and replacement value by function.

The Department of Transportation provides housing to highway maintenance personnel located at 14 remote sites throughout the state, and to highway patrol officers at three of the same sites. In total, Transportation has 52 employees living in 34 agency dwellings and in 18 personal trailers parked on agency-provided pads with agency-provided utilities. In addition, Transportation has eleven vacant trailer pads, and two vacant dwellings at one site where it recently eliminated employee housing. Transportation reported no seasonal dwellings. Approximately three percent of Transportation’s full-time employees are receiving some type of housing.

Figure 8 shows the total number of dwellings, combined fiscal year 1996 costs for utilities and capital improvements/maintenance, and replacement value by function. This listing includes trailer pads to reflect the department’s expenditures on utilities for those that are occupied.

The Department of Commerce, Division of State Parks and Historic Sites, requires park superintendents, assistant superintendents, and site curators to live in department housing if it is available. At some parks and sites, maintenance personnel live in housing. In total, there are 26 employees with year-round housing located at 14 different state parks and historic sites. In addition to the year-round dwellings, the division manages four seasonal dwellings and one dwelling that is currently vacant. One person occupying a seasonal dwelling is a contractor who sells concessions and is not a state employee. Some of the dwellings are actually owned by another entity, such as the Bureau of Reclamation, but the division manages them as part of long-term leases involving the parks at which they are located. With 187 full-time employees at the Department of Commerce as of July 1996, approximately 14 percent of full-time employees are provided year-round housing.

Figure 9 shows the total number of dwellings, combined fiscal year 1996 costs for utilities and capital improvements/maintenance, and replacement value by type of site.

Of the six remaining agencies that provide employee housing, three are agencies formerly managed by the Board of Charities and Reform (BCR). Before state government reorganization in 1990, the BCR oversaw institutions that are now assigned to the departments of Corrections, Family Services, and Health, as listed at left.

These agencies still manage their housing mainly under policies initiated by the BCR, calling for superintendents and wardens to have housing to provide 24-hour emergency supervisory coverage of the institutional grounds. However, circumstances at these institutions have changed. For example, not all currently have superintendents: Health’s three institutions for the aged are under one superintendent. Further, not all housing is still on institutional grounds: Correction’s warden houses are located adjacent to the grounds of the old prison, which is now a National Historic District administered by a local non-profit board.

BCR policies gave superintendents and wardens the discretion to assign available housing to additional employees when they determined that having these employees on institutional grounds was "an important element in the operation of the institution." Superintendents at institutions have used their housing discretion in various ways. For example, Health officials noted that housing was used as an incentive to attract doctors to the State Hospital, and has been included in their employment contracts. Within Family Services, the Girls’ School superintendent has assigned the employee in charge of security to housing to meet institutional needs for security, while the Boys’ School superintendent assigned the clinical director to on-grounds housing. At other institutions, maintenance employees inhabit housing.

In addition, two other agencies, the Department of Agriculture and the Military Department, and the University of Wyoming provide housing to employees. Each agency houses one employee; the University houses ten employees and three students at ten research facilities.

As a state-level practice, providing housing has evolved among agencies through a combination of tradition and expediency, without any overall guidance or leadership. Agencies appear to borrow policies from one another, develop them in isolation, or operate without them. The resulting housing management approaches are inconsistent or inadequate in certain areas that pose risks for both the employee-occupants and the state. We identified four areas in which this is true and for which we recommend action be taken to bring all agency practices into consistency. These areas are:

• Housing has not been adequately established as being both a condition of employment and a convenience of the employer.
• Inadequate policies create the potential for personnel disputes when housing assignments are altered.
• The state’s immunity from liability associated with the housing has not been acknowledged or adequately disclosed to employee-occupants. Adequate processes are not in place to protect the state from potential liability for negligently maintained housing.
• There are no standards or processes in place to guide housing acquisitions.

With no overall guidance or leadership in managing agency-provided housing, agencies have developed their own approaches. We recognize the merits of agencies customizing the management of their housing to meet their individual needs and resources. Nonetheless, there are some broad policy areas that warrant consistent approaches for the protection of both the employee-occupants and the state.

Not all of the agencies with housing have policies to manage its use. Those that do tend to focus on the more material issues relating to housing: what appliances are furnished, what responsibilities the employee-occupant and the agency has with respect to upkeep and maintenance, what pets are allowed, and who can live in the housing. While these aspects of housing are significant to the employees and agencies involved, they are not critical to the management of housing from a statewide perspective. This analysis identifies four broad policy areas which have not been addressed, either in practice or policy.

According to the Internal Revenue Service, housing is excluded from compensation if it is provided for the convenience of the employer, but only if the employee must accept such lodging on the employer’s premises as a condition of employment. The value of housing that does not meet this three-fold IRS test is considered compensation for both FICA and federal withholding taxes. Providing and accepting housing that does not meet the test could leave employers and employees liable for unpaid taxes.

It is the employee’s responsibility to pay required income tax and the responsibility of the State Auditor’s Office (SAO) to withhold appropriate FICA taxes. SAO payroll officials rely upon agencies to determine the status of the housing they provide and to inform them of employees who receive housing as an optional benefit. Agencies have identified no such cases and thus, the SAO is not withholding additional FICA taxes from any employees with housing. However, our review of agency policies and practices revealed inconsistencies that may conflict with the three-fold IRS test.

Through interviews and policy reviews, we encountered conflicting information as to whether or not housing was required. For example, policies adopted by the BCR and still in effect for three agencies state that housing is provided for state institution superintendents in order to have 24-hour emergency supervisory coverage. However, policies also say superintendents can request to live off-grounds. Further, officials acknowledged that employees living on state institutional grounds at the superintendents’ discretion are probably not required to live there by any formalized position descriptions.

Officials from the three agencies engaged for this study adamantly stated that employees assigned to housing were required to live there. Yet, for employees assigned to housing from these agencies, none of a sampling of position description questionnaires (PDQs) included it as a position requirement. State personnel officials told us that PDQs are individualized for each employee, and it is an agency’s discretion to include housing as a requirement in a PDQ. A state payroll official added that although the IRS may accept that the requirement to accept housing "goes with the territory" with some jobs, it would be better to include this requirement in vacancy announcements and PDQs.

All of the agencies reviewed were inconsistent in documenting the requirement in either policies, PDQs, or vacancy announcements. Hence, some might have difficulty in proving that the housing they provide is not subject to taxation if challenged.

Other inconsistencies we encountered included:

• Game and Fish officials told us that all wardens are required to live in the provided stations, but there is no written policy stating that requirement.
• Three agencies, Transportation, Health, and Family Services, require certain employees to accept housing so that they are available for 24-hour call. Yet, those employees are included on work rotations with other employees who do not receive housing. These agencies may in fact be using housing as an inducement for employees. This is acceptable to IRS, but such inducement must be coupled with a demonstrated need for the housing to be a condition of employment.
• The University and two agencies, Agriculture and Corrections, reported via our survey that not all of the employees in housing are required to live there. Yet, the University is not withholding taxes, nor have the agencies notified the SAO to withhold taxes for these employees who are apparently living in housing on an optional basis.

Not having a clear understanding with employees that housing is a convenience to the employer could lead to legal disputes. Although they ultimately did not file a complaint, Game and Fish employees who thought their housing was a compensation benefit threatened the department with litigation when it was eliminated. Since the department had not clearly communicated the housing status in a formal policy, its attorneys searched files, memorandums, and minutes to verify that there were no written agreements establishing housing as a contractually negotiated direct compensation benefit. The official who made the decision to eliminate the housing admitted that while he knew he had the general authority, an unambiguous policy handed to employees when they were hired would have facilitated his actions.

Transportation officials told us that some employees considered it a "down-grade" when they were required to provide their own trailers at sites where other employees had housing. Another agency faced a grievance when an employee sought housing because other employees of the same classification had housing. Such perceived inequities can arise when agencies lack policies that clarify housing as a convenience of the employer rather than a feature of certain job classifications.

Within those policies that do exist, we found little to guide or enable agencies to make operational changes that might affect housing. The only provisions requiring employee-occupants to vacate the premises applied to situations in which employment is terminated. We found no indication of what might transpire should an agency reassign an employee to a position without housing or decide that housing at a particular location was no longer needed. Further, these policies fail to inform employee-occupants of what notice they can expect should the agency discontinue use of the housing. They also imply that employees have housing until their employment terminates.

Without having policies that clearly address such issues, agencies may be inhibited from making changes that would promote efficiency but which affect employee-occupants. The few agencies that had made changes such as eliminating housing or formalizing agreements with the employee-occupants, waited until the housing was vacant before taking action. Other agencies expressed frustration at not being able to make changes until current employee-occupants move.

Under the Governmental Claims Act, the state claims immunity from liability in situations related to employees’ use of state-owned housing, unless negligence on behalf of a state employee is involved. However, officials we interviewed said this issue is not formally acknowledged. The state’s immunity has implications for families of employee-occupants with respect to any harm that might come to them or their guests from use of state-owned residences. Given that agency-provided housing is often in inherently risky locations, such as state institutions or sites not readily accessible to law enforcement, employee-occupants should be informed of the state’s indemnification. However, we found that just two agencies made some attempt to convey this information.

While no incidents resulting in harm to members of employee families have occurred, all agency officials agreed that the potential exists. Two officials implied that practices and policies would probably change if such an incident occurred. By designing some programs to operate with on-site employee residency, the state has put certain employees and their families at greater risk than if they lived in regular communities. However, the state has done nothing to prepare for this known risk. One risk management official we interviewed noted that there are ways to fashion insurance coverage for these situations, should the state make a policy decision to do so.

Liability issues could also arise in relation to negligent maintenance at state-owned dwellings which results in injuries or harm to an individual. Most agencies assign responsibility for maintenance decisions to employees (usually the supervisors of the employee-occupants), and the state can be held liable for the negligence of state employees acting within the scope of their duties. A jury could find the state liable for negligent maintenance that resulted in injuries.

We found an array of maintenance practices among agencies. Most do not appear to require that housing be inspected by employees with facility management expertise. Typically, decisions about maintenance are based on district supervisor or site superintendent recommendations. In some agencies, employees are responsible for their own maintenance. Game and Fish, which has the most housing, has no formal procedures in place for the inspection and maintenance of its dwellings. Furthermore, employee-occupants have different levels of control over the maintenance of their dwellings. Some, such as institution superintendents, have both decision-making and budgetary control. Others must go through a chain of command to get needs addressed.

Agencies make maintenance decisions within the constraints of their program budgets, and state facilities management officials say that maintenance budgets often get diverted to other program needs. Officials with Commerce’s Division of State Parks and Historic Sites noted that although housing is critical to operations, available funding restricts their ability to make housing consistent among sites. From data reported by the division for the last three fiscal years, we computed an average maintenance expenditure per dwelling, for the three-year period, of $438. This was the smallest amount among the engaged agencies. In contrast, Transportation, whose officials characterized their housing as standard and adequate, spent an average of $1,072 per dwelling during the same period.

Various state officials involved with building inspections told us that agencies with housing should take steps to ensure the safety of those dwellings. The state’s General Services Facilities Management Section within the Department of Administration and Information is not involved in housing maintenance decisions unless they involve capital improvement requests of $10,000 or more, and then only for certain agencies. Nonetheless, facilities management officials said agencies should determine basic inspections to ensure health and safety issues are addressed.

Other officials from the departments of Environmental Quality (DEQ) and Fire Prevention and Electrical Safety (Fire Marshal’s Office) said that professionally directed routine maintenance and inspections can address safety and health hazards, such as lead-based paint or electrical safety problems. Given the age of many of the state’s employee dwellings, these hazards may exist in them. Yet, we found no agency safety and health standards for employee housing. Further, given the technical nature of these issues, agency personnel currently conducting dwelling inspections may not have the expertise to recognize them.

A majority of dwellings acquired during the 1990s have been purchased through informal procedures and without involvement in the legislative budget process. The Legislature does not review the budget of Game and Fish, which holds most of the employee housing and has purchased most of the dwellings acquired in the last decade.

As illustrated in Figure 10, 26 dwellings have been acquired for employee housing between 1990-1997. Of these 26 dwellings, 17 belong to Game and Fish, 8 belong to Commerce, and 1 belongs to Corrections.

*Both bunkhouses.

The largest subgroup within these recently acquired dwellings is game warden stations, of which there are ten. We found that the Game and Fish acquisition process for these stations is informal, with no written criteria. There are no specifications for warden stations, such as for accessibility or location in relation to the population base served. The amount budgeted for the acquisition, generated by the regional supervisor, is the only formal selection parameter.

Lacking criteria for a warden station, there is a range of acquisition prices not fully explained by local housing markets. The acquisition prices range from $52,650 for a warden house in Glenrock to $160,000 for a house in Alpine that subsequently had a garage and office added for $29,387. It is understandable that a house in Alpine, which is a desired scenic location, would cost more than a similar house in Glenrock. However, based on house rents collected through the Wyoming Cost of Living Index survey, the housing markets for Gillette and Rock Springs were comparable between the fourth quarter of 1994 and the fourth quarter of 1996 (the latest data available). Hence, it is not clear why a warden station was purchased for $84,000 in Gillette in 1994 and one was purchased for $135,000 in Rock Springs in 1997. As it stands, there is no guarantee that adequate but comparable properties are being acquired in different communities for warden stations.

Transportation has not acquired any new dwellings since the late 1970s, and it does not have specifications for an acquisition process or for a recommended standard dwelling, should new housing be needed. Since only the Administrative Services portion of Transportation’s budget is reviewed by the Legislature, employee dwellings could be purchased without involvement in the legislative budget process.

Although eight state agencies and the University of Wyoming are providing a significant amount of employee housing, there is no law or statewide policy to guide them. In a matter with potential for tax consequences and other liabilities, clear legislative policy is essential.

The Legislature could initiate action by appointing a committee to make overall policy recommendations regarding housing. We suggest the Legislature include those agencies that currently provide housing, as well as other agencies with related expertise and concerns. For example, the Attorney General, the State Auditor, the Department of Administration and Information (for personnel, facilities management, and insurance knowledge), DEQ, and the State Fire Marshal have perspectives that need consideration. The committee could be charged with developing policy in such areas as:

• Factors that would make housing a convenience of the employer and a condition of employment.
• Administrative matters such as taxability issues and the relationship between employee housing and compensation.
• Safety and health standards for employee dwellings.
• Means of informing employee-occupants of the state’s indemnity.
• Criteria for determining the type of housing acquired, and guidance for disposing of non-essential housing.

The committee should report its recommendations on housing policy to the Legislature by October 1, 1998. Working together, the Legislature and executive branch can then determine whether a state housing policy would best be implemented administratively, or whether it should be incorporated into statute.

Such direction would help ensure that all agencies are correctly administering the range of issues related to housing. As a byproduct, agencies may be prompted to review their housing needs and perhaps dispose of unneeded structures or convert them to other program uses.

Almost everyone we contacted during our research commented that housing is a difficult issue. Housing cannot usually be moved to where it can be most effectively used, and is not easily eliminated or acquired. Hence, decisions made at one point in time often lock subsequent managers into a way of doing things that may no longer be most effective. Providing housing becomes a tradition and a commitment, both of which are difficult to change.

Furthermore, although all nine agencies had official purposes for providing housing, officials from most also commented on the human elements that complicate it. For example, we heard that housing compensates for the lack of job opportunities in remote areas for employee spouses, and that it attracts employees who might not otherwise consider positions because of salary or location. Officials commented that while employees often see housing as a benefit, they also balance it with the additional responsibilities that accompany housing. One official spoke of the difficulty in managing housing and still maintaining respect for it as employees' personal residences.

These types of considerations, along with the inertia of tradition and the existence of the facilities, appear to have discouraged some agencies from critically assessing housing's benefit to current operations. Others have at least considered their rationale for providing housing, if not formally reviewed it. By implementing the recommendation offered in this report, the Legislature can establish criteria for agencies to use in assessing their housing, and prompt them to undertake the reviews.