Lease Signed for Prison Health Agency Move to Elk Grove

California Correctional Health Care Services, which provides medical care for the state's prison inmates, has signed a lease agreement to relocate its headquarters to Elk Grove, a spokesperson for the agency confirmed Friday.

The deal on a 20-year lease at the Laguna Springs Corporate Center came two days after city leaders to the agency, and despite objections from the chair of the state's Joint Legislative Budget Committee that the move was too costly.

"The planned lease is the best value for the State," J. Clark Kelso, the receiver who oversees the agency under the terms of a court settlement, wrote in a letter Friday to state Sen. Mark Leno.

Leno had previously suggested that the agency would be paying above market rate for the Elk Grove space. But Kelso said the market rate figures cited by Leno were "misleading" and did not include the cost of tenant improvements.

About 1,500 agency employees will occupy 265,000 square feet of office space in the property owned by Pappas Investments, with the first couple hundred set to move in by April 2012, said spokesperson Nancy Kincaid. The agency's clinical staff—medical, mental and dental—will move first, Kincaid said.

New buildings will be constructed on the site to accomodate the rest of the employees by August 2013, according to the lease agreement.

Kincaid, who like about 35 percent of the agency's workers lives in Elk Grove, said her office is already assembling information for employees about local shopping and transit routes.

The Elk Grove spot in a competitive bidding process in which the city played a major role. It's the first time the city has used money from a special incentive fund set up to lure state agencies.

"This is a landmark day for the city of Elk Grove," Mayor Steven Detrick wrote in an email announcing the agreement.