Firm moves to keep state agencies in S. Station
The company that manages the South Station office building for the MBTA asked the Patrick administration to delay plans to move three state agencies out of the building, arguing the relocation would cause the transit agency to lose up to $9 million in rents at a time of deep financial distress.
Equity Office Properties also suggested it would offer the three agencies lower rents to keep them from moving to a building in the South End, where the state would pay rent to a private developer.
The agencies involved are the divisions of Banks and Insurance and the Department of Telecommunications and Cable.
The property company wants a 30-day delay in the new lease decision, in order to meet with government officials to discuss "substantial misunderstandings" about the financial impact of the relocation on the MBTA, according to a copy of the letter.
"The MBTA has estimated its potential loss of income will be between $6 million and $9 million" during the next three years, wrote Stephen Oleskey, an attorney at the Boston firm WilmerHale who represents Equity Office.
The MBTA is contemplating cuts in bus and rail service to close a $160 million budget gap. A spokesman for the authority declined to comment.
The Division of Capital Asset Management, which managed the search for the agencies' office space, has said the building in the South End, at 1000 Washington St., offered a lower rent that would save the agencies $9.5 million over the next 10 years.
"DCAM used an open, transparent, and competitive process for these leases," Cyndi Roy, a spokeswoman for the agency, said in a statement. "Equity came in 30 percent higher than other bidders and failed to meet the space needs of these agencies."
She declined to comment on the request for a 30-day delay.
Equity Office, which splits rental income from South Station tenants with the MBTA, and also stands to lose millions from the move, argued the savings cited by the government are "illusory" and will not accrue to taxpayers. The agencies are funded by fees they charge the companies they regulate, so any savings would go to those companies, not taxpayers.
"The Commonwealth will be in a better overall financial position if the state agencies remain at South Station," Oleskey wrote.
Meanwhile, a Republican state senator has asked State Auditor Joseph DeNucci to investigate the relocation of the agencies.
"To me, something just doesn't seem right here," said Senator Richard Tisei, a Republican from Wakefield. "It seems you could make a pretty good case the taxpayers are going to be hurt by this, and I don't know if that's been given enough consideration here."
A spokesman for DeNucci said no decision has been made about whether to launch an investigation.
Casey Ross can be reached at cross@globe.com. 