Over the objections of those of us who were labeled “naysayers,” the school board majority bulled ahead with a real estate plan destined to fail. It was destined to fail because it was based on foolish presumptions that violated every tenet of basic business practice: supply-and-demand.
Our school district dumped 10 large buildings--8 of them school buildings--and nearly 200 acres on the market at the same time in a little city like Duluth. Under the school board’s direction, it refused to consider offers from the most likely customer for the properties--other educational organizations--and still claimed all this “excess property” would sell quickly and at top dollar.
Some of us saw--and everyone in Duluth should see now--that this was a fool’s plan.
Five years ago, the school board actually rejected an offer put on the table for the largest of these “excess” properties: the new Central campus. The asking price for the property was $13.7 million, but the potential buyer--Edison Charter School--offered a half million more: $14.2 million. The four DFL/teacher union-endorsed board members refused to sell. One of these individuals--Rosie Loeffler-Kemp--is running for reelection in the 1st district, on the east end of Duluth. She and her three allies told us not to worry about the fact that they were turning down $14.2 million. They said they had a “new marketing strategy” that would soon solve our problems. Five years have passed since Edison’s offer was refused. The property has now been vacant for a total of ten years, but Rosie and her allies have finally revealed their savvy business strategy: Rather than making $14.2 million, the taxpayers will spend millions more.
Recently, the list of excess district properties was expanded to 11 buildings, 9 of them school buildings. The old, historic Central building--our town’s ornate, architectural gem--has now been included on the list.
The district had to sell Old Central because the building had fallen into a state of disrepair. Most of the repairs scheduled to be done, as part of the Red Plan, were tossed out when the plan’s budget went south for the first time in 2010. Over the course of ten more years, the building’s roof started leaking so badly, pails had to be put out around the boardroom during rainstorms.
A recent audit found the 129-year-old building requires $48.5 million worth of repairs. The claim that the district is saving $48.5 million by selling the school is true. However, the school board now contends it has $48.5 spending money available, and, true to form, is on another spending spree with no vote from the public. They’ve hatched a plan to spend $31.5 million to build a bus barn and administration building on the new Central campus. The claim that this scheme still “saves” taxpayers $17 million is largely another shell game, because maintenance money is being used.
Another of the Red Plan’s many flaws was that no maintenance component was included in a so-called “long-range” facilities plan. The plan (at least theoretically) made all the district’s facilities “new or like-new” within a five-year span, which made it impossible to stagger out a sensible maintenance schedule. Another decade or so down the road (about the time the half billion dollar bond bill is finally paid off,) the district is set up to be hit with a huge wave of maintenance expense.
During the May, 2018, Business Committee meeting, the current Facilities Manager, Dave Spooner, voiced this warning to the school board: “It’s important for everyone to note that the (Red Plan) buildings were constructed between ‘08 and ‘13, and we’re (now) ten years out from the first buildings, and we may have another ten years. We kind of have a grace period--another five or ten years--and once that ends, all the buildings will need work in a five-year period, and that’s going to be a huge number, so that’s important to note.”
The day of reckoning for a poorly-planned investment is coming closer, and it will be a huge number--made even more huge now, by another unwise school board decision.