Report to the Board on Demolition of Schools - Farmington Public ...

BUILDING & SITE/SAFETY COMMITTEE MEETINGDECEMBER 7, 2010INTRODUCTIONTABLE OF CONTENTSEXECUTIVE SUMMARY AND RECOMMENDATIONFormer InquiriesJoe Fazio, Miller, Canfield, Paddock & S<strong>to</strong>ne commentsWOODDALE May 2008 Summary Marketability Findings by Great Nor<strong>the</strong>rn Land Company Legal Review of Deeds and Property Restrictions by Larry Dudek, Miller,Canfield, Paddock & S<strong>to</strong>ne Author’s CommentsEAGLE May 2008 Summary Marketability Findings by Great Nor<strong>the</strong>rn Land Company Legal Review of Deeds and Property Restrictions by Larry Dudek, Miller,Canfield, Paddock & S<strong>to</strong>ne Author’s CommentsFLANDERS May 2008 Summary Marketability Findings by Great Nor<strong>the</strong>rn Land Company Legal Review of Deeds and Property Restrictions by Larry Dudek, Miller,Canfield, Paddock & S<strong>to</strong>ne Author’s CommentsWILLIAM GRACE May 2008 Summary Marketability Findings by Great Nor<strong>the</strong>rn Land Company Legal Review of Deeds and Property Restrictions by Larry Dudek, Miller,Canfield, Paddock & S<strong>to</strong>ne Author’s CommentsFAIRVIEW May 2008 Summary Marketability Findings by Great Nor<strong>the</strong>rn Land Company Legal Review of Deeds and Property Restrictions by Larry Dudek, Miller,Canfield, Paddock & S<strong>to</strong>ne Author’s CommentsSUMMARY OF LEGAL CONSIDERATIONS FOR SALE OF REAL PROPERTYexcerpts from letter by Amanda VanDusen, Miller, Canfield, Paddock & S<strong>to</strong>ne-February24, 2010.1

PROS FOR DEMOLITIONCONS FOR DEMOLITIONREUSE OF FIXED EQUIPMENT Gill Chiller Replacement from William Grace Highmeadow Chiller Replacement from Wooddale Warner Boiler Replacement from Flanders and Wooddale Power, Warner, OED, and East – install relocated casework from closedelementary sites and Fairview-$215,000 Glass basketball backboards from William Grace and EagleATTACHMENTS Former Inquiries for Purchase or Lease of Closed Schools Farming<strong>to</strong>n Public Schools-Site Review for Wooddale, Eagle, Flanders,William Grace and Fairview by Great Nor<strong>the</strong>rn Consulting Group-May 2008. At<strong>to</strong>rney-Client Privilege Letter from Amanda VanDusen, Miller, Canfield,Paddock & S<strong>to</strong>ne, PC-under separate coverINTRODUCTIONAt <strong>the</strong> December 7, 2010 Building and Site Committee meeting our discussion will centeron <strong>the</strong> disposition of Wooddale, Eagle, Flanders, William Grace and Fairview, <strong>the</strong> closedsites. A discussion about <strong>the</strong> disposition of MTC will not take place at this time as wework and talk more with <strong>the</strong> City about potential future uses.As you know, we’ve moved <strong>the</strong> instructional furniture and equipment that staff wanted in<strong>the</strong>ir schools. In addition, we used 10 univents from Eagle and MTC and casework fromEagle <strong>to</strong> help furnish <strong>the</strong> 10 new classrooms at Warner and Power Upper ElementarySchools.We have plans <strong>to</strong> reuse much more of <strong>the</strong> items in <strong>the</strong> closed schools including, but notlimited <strong>to</strong>, remaining casework, chillers and boilers for parts, glass basketballbackboards, circulating pumps, whiteboards and some lighting, energy managementcontrols, etc. Once this is complete, which we expect in <strong>the</strong> late spring, we believe <strong>the</strong>sites will be ready for <strong>the</strong>ir next phase.Before we continue <strong>to</strong> reuse many items in <strong>the</strong> closed schools, we need <strong>to</strong> determine ifwe offer <strong>the</strong> closed buildings for sale, or demolish <strong>the</strong> buildings and offer sites only, or acombination of both.The information below provides <strong>the</strong> <strong>Board</strong> with all of <strong>the</strong> information we have ga<strong>the</strong>red<strong>to</strong> date <strong>to</strong> help us in determining our next steps.2

EXECUTIVE SUMMARY AND RECOMMENDATIONWe have reviewed <strong>the</strong> information provided <strong>to</strong> <strong>the</strong> Learning Configurations and FacilityStudy Committee by Great Nor<strong>the</strong>rn Consulting Group in May 2008 pertaining <strong>to</strong> <strong>the</strong>closed sites, reviewed all deeds <strong>to</strong> <strong>the</strong> properties <strong>to</strong> determine if any deed restrictionsexist for future uses, have investigated <strong>the</strong> reuse of many building components in <strong>the</strong>closed schools and spoken <strong>to</strong> legal counsel. Based upon this information and discussionwith our Central Office Team we make <strong>the</strong> following recommendation.It is <strong>the</strong> recommendation of <strong>the</strong> administration that <strong>the</strong> five closed school buildings bedemolished. The reasons are as follows:1. All of <strong>the</strong> sites are zoned residential offering very limited reuse opportunities for<strong>the</strong> buildings. Fairview contains a deed restriction citing only residential use if<strong>the</strong> site is not used for elementary school purposes. Wooddale, located within asubdivision and on a residential street, does not meet <strong>the</strong> City of Farming<strong>to</strong>nHills requirements for a special land use since it is not on a major or secondarystreet. William Grace is a site <strong>the</strong> District may want <strong>to</strong> retain for a new school in<strong>the</strong> future. It also contains a deed restriction limiting its use <strong>to</strong> residential.Flanders roof is currently leaking in <strong>the</strong> office area and needs a good portion ofits roof replaced as soon as possible in order <strong>to</strong> avoid more damage. Eagle,although zoned residential, could have o<strong>the</strong>r potential that may be permitted by<strong>the</strong> West Bloomfield Township Zoning Ordinance.2. We would like <strong>to</strong> remove all of <strong>the</strong> casework installed with <strong>the</strong> 1997/99 bondissues from <strong>the</strong> five closed schools and relocate it where it is much needed atPower and Warner Upper Elementary Schools <strong>to</strong> provide classroom s<strong>to</strong>rage forteachers. Once this need is met, O.E. Dunckel and East Middle School whosecasework is original <strong>to</strong> <strong>the</strong>ir construction in 1957 and 1963, would receive <strong>the</strong>remainder, if any. Estimated cost <strong>to</strong> install is $215,000. Estimated savings is$150,000 <strong>to</strong> $170,000.3. We would like <strong>to</strong> salvage <strong>the</strong> two boilers from Flanders and Wooddale and <strong>the</strong>chiller from William Grace for parts which are highly expensive. We are alreadyin <strong>the</strong> process of relocating <strong>the</strong> chiller from Wooddale <strong>to</strong> Highmeadow.4. O<strong>the</strong>r items such as, but not limited, <strong>to</strong> circulating pumps, fob readers, glassbasketball backboards, clock systems, white boards, gym lighting at Eagle andenergy management controls could be salvaged for reuse in <strong>the</strong> District.5. We have already supplied <strong>the</strong> new classrooms at Warner and Power withunivents from Eagle and MTC, and casework from Eagle. Also, FCS and Forestreceived casework for <strong>the</strong>ir added classrooms.6. Once <strong>the</strong> above items are ‘recycled’ in<strong>to</strong> our existing schools, especially <strong>the</strong>casework, <strong>the</strong> schools are not ideal sites for reuse and easy occupancy withoutextensive capital investment by a purchaser.7. The market for residential properties, <strong>the</strong> zoning of all closed sites, is less thandesirable at <strong>the</strong> current time. Waiting for <strong>the</strong> residential market <strong>to</strong> turnaroundwhile holding on<strong>to</strong> closed schools will create fur<strong>the</strong>r deterioration of <strong>the</strong>3

8. The estimated cost <strong>to</strong> demolish <strong>the</strong> 5 closed elementary schools is approximately$900,000. The estimated annual mothball expense is $111,500. We expect thatthis amount will be available from money set aside for restructuringimplementation as reported <strong>to</strong> <strong>the</strong> <strong>Board</strong> in Oc<strong>to</strong>ber 2010.The information below provides <strong>the</strong> in depth discussion of <strong>the</strong> summarized rationale fordemolition cited above.Former InquiriesWhen we first announced that certain schools would close, we were inundated withphone calls from brokers wanting <strong>to</strong> list <strong>the</strong> sites or indicating <strong>the</strong>y had a buyer. We alsohad a several inquiries from individuals looking for school sites (see attached FormerInquiries). At <strong>the</strong> time, we indicated that we were not listing <strong>the</strong> properties and that wewere still planning moves and getting ready for school in <strong>the</strong> fall. We are now ready <strong>to</strong>begin planning <strong>the</strong> next phase.Joe Fazio, Miller, Canfield, Paddock & S<strong>to</strong>ne commentsI have spoken <strong>to</strong> Joe Fazio, Miller, Canfield, Paddock & S<strong>to</strong>ne, who has experience inproperty sales. His comments are as follows:If we decide <strong>to</strong> sell <strong>the</strong> properties, select a broker that will actively engage <strong>the</strong>marketplace ra<strong>the</strong>r than just providing a listing.We can ei<strong>the</strong>r select a broker or issue a Request for Proposals for a broker.Look for a broker with specific expertise, i.e. residential, commercial or industrialdepending upon our intended future use of <strong>the</strong> property.Look at deed restrictions first and find out limitations (see analysis below).Chances of a third party buying for residential redevelopment and incurringdemolition will likely not happen in near term.Cost <strong>to</strong> build new is much greater than buying existing.Little likelihood in finding a residential buyer; banks have gotten back propertiesand are dumping <strong>the</strong> excess inven<strong>to</strong>ry for very little. Platted subdivisions arebeing forfeited for nonpayment of taxes.Don’t do appraisal until we have a buyer.If we think a building has o<strong>the</strong>r than residential value, get broker and determineinterest before demolition.May 2008 Summary Marketability Findings by Great Nor<strong>the</strong>rn Land Company andLegal Review of Deeds and Property Restrictions by Larry Dudek, Miller, Canfield,Paddock & S<strong>to</strong>neIn May 2008, we retained Great Nor<strong>the</strong>rn Consulting Group, Ann Arbor, MI <strong>to</strong> assess <strong>the</strong>marketability of all District owned properties for <strong>the</strong> first Facility Study Group (LearningConfigurations and Facilities Study Team). Summarized below are <strong>the</strong> Great Nor<strong>the</strong>rn4

findings from <strong>the</strong>ir Property Investigation and Summary <strong>Report</strong> of <strong>the</strong> school sites citedunder <strong>the</strong> headings as site size, master plan, zoning and redevelopment options. Attachedfor your fur<strong>the</strong>r information is <strong>the</strong> non-summarized information pertaining <strong>to</strong> <strong>the</strong> closedsites by Great Nor<strong>the</strong>rn Consulting Group.We also engaged Larry Dudek, Miller, Canfield, Paddock and S<strong>to</strong>ne, during <strong>the</strong> secondgroup’s work (Facility Study Team) <strong>to</strong> help determine if any of <strong>the</strong> sites underconsideration for closure had restrictions requiring that <strong>the</strong> site be maintained for schooluse. His finding is that “none of <strong>the</strong> restrictions require <strong>the</strong> premises <strong>to</strong> continue <strong>to</strong> beused for school purposes.” He also examined all of <strong>the</strong> property deeds <strong>to</strong> assure that nonewere charitable contributions and reviewed <strong>the</strong> deed restrictions. His findings aresummarized below as Use Restrictions. Then we added some “Author’s Comments.”WOODDALEMay 2008 Summary Marketability Findings by Great Nor<strong>the</strong>rn Land CompanySite Size: 10 acresMaster Plan: SchoolZoning: RA-1 One Family Residential – 20,000 sq ft lots, minimum 100’ widthRedevelopment Options: one family residential-estimated 15 lots.“This site is ano<strong>the</strong>r that is integrated in<strong>to</strong> older neighborhoods with no o<strong>the</strong>r transitionuses. Therefore, it is unlikely that o<strong>the</strong>r options will be available.”Legal Review of Deeds and Property Restrictions by Larry Dudek, Miller, Canfield,Paddock & S<strong>to</strong>neUse restrictions: None of <strong>the</strong> deeds comprising parcels 1-4 contain any restrictionswhich would require <strong>the</strong> premises <strong>to</strong> continue <strong>to</strong> be used for school purposes.As for Parcel 4 – it is subject <strong>to</strong> restrictions which state “There shall be no building ordevelopment of <strong>the</strong> Land o<strong>the</strong>r than as specifically set forth in Paragraph 4 (which allowsfor certain improvements relating <strong>to</strong> an existing residence on 1.08 acres of <strong>the</strong> entireparcel comprised of 11.186 acres). All structures of any nature or kind, use or descriptionare specifically prohibited. “Structure’ shall be defined <strong>to</strong> include, but not be limited <strong>to</strong>,hoses, garages, s<strong>to</strong>rage facilities, fences and recreational facilities (such as tennis courts,swimming pools and <strong>the</strong> like).”Therefore, a purchaser of Parcel 4 would not be able <strong>to</strong> construct any structure on <strong>the</strong>parcel. The restriction does not prohibit <strong>the</strong> District from making a conveyance of <strong>the</strong>parcel.Author’s comments: Based upon <strong>the</strong> location of <strong>the</strong> school in <strong>the</strong> middle of aneighborhood, <strong>the</strong> best use appears <strong>to</strong> be for residential purposes. The fact that you have<strong>to</strong> travel through a subdivision <strong>to</strong> get <strong>to</strong> <strong>the</strong> site makes it unfavorable for a special useclassification such as nursing home or senior housing. The City of Farming<strong>to</strong>n Hills willlikely not approve a special land use unless <strong>the</strong> property is on a major or secondary road.The school has had several broken windows. Facilities Management wants <strong>to</strong> relocate5

casework <strong>to</strong> <strong>the</strong> upper elementary schools, its chiller <strong>to</strong> Highmeadow and save its boilerfor parts. Once <strong>the</strong>se items are removed, <strong>the</strong> building would need significantimprovements for its reuse. We recommend that this structure be demolished. Estimateddemolition cost: $182,000.Wooddale is <strong>the</strong> only school with improvements from outstanding bonds being <strong>the</strong> 1997bond issue. If <strong>the</strong> property is sold and bonds are still outstanding, <strong>the</strong> proceeds can beused for o<strong>the</strong>r District capital projects.EAGLEMay 2008 Summary Marketability Findings by Great Nor<strong>the</strong>rn Land CompanySite Size: 9.55 acresMaster Plan: Public/Quasi-publicZoning: R-15 One Family Residential – 15,000 sq ft lots, minimum 100’ widthRedevelopment Options: “The West Bloomfield planner indicated during a phoneconversation that it is unlikely that <strong>the</strong> Township will consider revising its Master Plan in<strong>the</strong> event that <strong>the</strong> site was <strong>to</strong> become available for redevelopment. He suggested that <strong>the</strong>underlying R-15 One-Family Residential zoning would likely remain, and <strong>the</strong>refore <strong>the</strong>potential available redevelopment options would be those allowed in <strong>the</strong> R-15 district aspermitted uses and potentially some of <strong>the</strong> uses that are allowed with special land useapproval; such as ‘maybe senior housing.’”“If this holds true, <strong>the</strong> likely redevelopment options would be: one-family residentialhome sites; approximately 18-22 lots, senior assisted living, child care facility.”“Ano<strong>the</strong>r consideration that was not discussed with <strong>the</strong> Planning, but may have merit andworth consideration of <strong>the</strong> neighbors’ support, is a limited commercial development on 2-3 acres at <strong>the</strong> corner (possibly a drugs<strong>to</strong>re and bank) and <strong>the</strong> dedication of <strong>the</strong> balance of<strong>the</strong> site for open space and/or a <strong>to</strong>wnship park.”Legal Review of Deeds and Property Restrictions by Larry Dudek, Miller, Canfield,Paddock & S<strong>to</strong>neUse restrictions: “None of <strong>the</strong> deeds contain any restrictions which would require <strong>the</strong>premises <strong>to</strong> continue <strong>to</strong> be used for school purposes.” The property is subject <strong>to</strong> variouseasements and right-of-ways including Michigan Bell, Oakland County Public Works,West Bloomfield Township, Detroit Edison.Author’s commentsFacilities Management has relocated significant casework and some univents <strong>to</strong> Warnerand would like <strong>to</strong> relocate <strong>the</strong> remaining casework <strong>to</strong> <strong>the</strong> upper elementary schools. Theglass basketball backboards and gym lighting would be a welcome addition <strong>to</strong> schoolswith very old backboards. Estimated demolition cost: $232,000.We discussed permitted uses for <strong>the</strong> property with <strong>the</strong> <strong>to</strong>wnship planner. The zoningpermits single-family homes, private schools and day care centers. Special land uses that6

could be considered are: churches, public library, public use, cemetery, child care center,senior housing.FLANDERSMay 2008 Summary Marketability Findings by Great Nor<strong>the</strong>rn Land CompanySite Size: 10 acresMaster Plan: Quasi-publicZoning: R1 Single Family Residential – 8,500 sq ft lots, minimum 70’ widthRedevelopment Options: one family residential-estimated 40-45 lots“Great redevelopment site for single-family residential.”Legal Review of Deeds and Property Restrictions by Larry Dudek, Miller, Canfield,Paddock & S<strong>to</strong>neUse restrictions: None of <strong>the</strong> restrictions require <strong>the</strong> premises <strong>to</strong> continue <strong>to</strong> be used forschool purposes. The property is encumbered by various Michigan Bell, Detroit Edisonand City of Farming<strong>to</strong>n easements.Author’s commentsSchool in need of a new roof (estimated at $200,000 for a portion of <strong>the</strong> building). It iscurrently leaking in <strong>the</strong> front office suite. Facilities Management (FM) would like <strong>to</strong>relocate <strong>the</strong> casework <strong>to</strong> <strong>the</strong> upper elementary schools and its boiler <strong>to</strong> Warner.The city was open <strong>to</strong> a special land use when an adult day care showed some interest.Residential use seems <strong>the</strong> most appropriate for <strong>the</strong> area. We recommend that <strong>the</strong>structure be demolished especially since <strong>the</strong> District has good use for its casework, boilerand chiller. Estimated demolition cost: $162,000.WILLIAM GRACEMay 2008 Summary Marketability Findings by Great Nor<strong>the</strong>rn Land CompanySite Size: 8.6 acresMaster Plan: SchoolZoning: RA-1 One Family Residential – 20,000 sq ft lots, minimum 100’ widthRedevelopment Options: 12-14 one family residential-estimated 15 lots or seniorhousing.Legal Review of Deeds and Property Restrictions by Larry Dudek, Miller, Canfield,Paddock & S<strong>to</strong>neUse restrictions: None of <strong>the</strong> restrictions require <strong>the</strong> premises <strong>to</strong> continue <strong>to</strong> be used forschool purposes. “The building and use restrictions as <strong>to</strong> Parcels 1 and 2 (entire site) arelargely outdated but, if enforceable, could impact future use and development of <strong>the</strong>property. In general, <strong>the</strong> use restrictions relate <strong>to</strong> <strong>the</strong> requirement that <strong>the</strong> parcels be usedfor residential purposes.” See note below.7

Author’s commentsFM would like <strong>to</strong> relocate casework <strong>to</strong> <strong>the</strong> upper elementary schools and retain its chillerfor parts. The glass basketball backboards would be a welcome addition <strong>to</strong> schools withvery old backboards. The <strong>Board</strong> may want <strong>to</strong> consider retaining this site which would bea good location for a future elementary school because of its location on a secondaryroad. Estimated demolition cost: $195,000.FAIRVIEWMay 2008 Summary Marketability Findings by Great Nor<strong>the</strong>rn Land CompanySite Size: 11 acresMaster Plan: SchoolZoning: RA-1 One Family Residential – 20,000 sq ft lots, minimum 100’ widthRedevelopment Options: one family residential-estimated 8-10 lots or 3 estate sizedlots.“Redevelopment options are limited due <strong>to</strong> <strong>the</strong> limited access <strong>to</strong> <strong>the</strong> site combined withnarrow site dimension and some apparent wetlands. In order <strong>to</strong> develop <strong>the</strong> property in<strong>to</strong>a single-family development, substantial infrastructure would be required: road,water/sewer extension, etc. The large estate lot option would require few infrastructureimprovements.”Legal Review of Deeds and Property Restrictions by Larry Dudek, Miller, Canfield,Paddock & S<strong>to</strong>neUse restrictions: “Lots do not contain any restrictions which would require <strong>the</strong> premises<strong>to</strong> continue <strong>to</strong> be used for school purposes.”The lots might be subject <strong>to</strong> certain covenants and building and use restrictions. Therestrictions contained in <strong>the</strong> Restrictions Agreement were modified by an Amendment ofRestrictions Agreement dated 12/27/65 (<strong>the</strong> Amendment) and recorded on 1/13/66executed by <strong>the</strong> seller and FPS. This instrument waives <strong>the</strong> right of <strong>the</strong> seller <strong>to</strong> enforce<strong>the</strong> terms of <strong>the</strong> Restrictions Agreement <strong>to</strong> permit <strong>the</strong> District “<strong>to</strong> construct, operate andmaintain its elementary school” provided that <strong>the</strong> District agrees <strong>to</strong> <strong>the</strong> conditionscontained in <strong>the</strong> Amendment.”The Amendment included various requirements with respect <strong>to</strong> <strong>the</strong> use of <strong>the</strong> lots for anelementary school. There are restrictions regarding access <strong>to</strong> <strong>the</strong> premises andrequirement of a landscaped greenbelt. The terms of <strong>the</strong> Restrictions Agreement arestated <strong>to</strong> be binding upon <strong>the</strong> parties and <strong>the</strong>ir successors and assigns and <strong>to</strong> run with <strong>the</strong>land. It does not appear that <strong>the</strong> o<strong>the</strong>r owners of lots in <strong>the</strong> subdivision signed anyagreement <strong>to</strong> waive <strong>the</strong> right of those owners <strong>to</strong> enforce <strong>the</strong> terms of <strong>the</strong> RestrictionsAgreement. Due <strong>to</strong> <strong>the</strong> passage of time and <strong>the</strong> lengthy period that <strong>the</strong> lots were used asa school it is unlikely that any owners of <strong>the</strong> o<strong>the</strong>r lots could raise an objection.It is not likely <strong>the</strong> Restriction Agreement would be construed <strong>to</strong> require use of <strong>the</strong>premises by <strong>the</strong> School District as an elementary school. At most <strong>the</strong> premises would8

ecome subject again <strong>to</strong> <strong>the</strong> terms of <strong>the</strong> Restrictions Agreement. The parcel is notcurrently being use for any purpose by <strong>the</strong> District.Author’s commentsThere is currently an encroachment with a basketball court by an adjacent propertyowner. He has offered <strong>to</strong> purchase <strong>the</strong> area of encroachment. FM would like <strong>to</strong> relocate<strong>the</strong> casework <strong>to</strong> <strong>the</strong> upper elementary schools. Estimated demolition cost: $114,000.NOTE regarding building and use restrictions: Legal counsel fur<strong>the</strong>r notes that “It appears that building and userestrictions are an interest in <strong>the</strong> land and are extinguished after 40 years if not preserved as allowed by <strong>the</strong> act. Theyare considered an in land in that <strong>the</strong>y are drafted <strong>to</strong> limit use of <strong>the</strong> property and are enforceable by certain parties on<strong>the</strong> grounds that <strong>the</strong> building and use restrictions enhance or protect <strong>the</strong> property values and character. Hence, such anencumbrance appears <strong>to</strong> expire after 40 years. However, many title insurance companies are hesitant <strong>to</strong> remove asexceptions <strong>to</strong> title building and use restrictions that are over 40 years old. The answer usually given for not removingthose restrictions is that <strong>the</strong> appellate courts in Michigan have not specifically ruled that <strong>the</strong> 40-year Marketable TitleAct covers building and use restriction. It may be argued that this is a valid position because building and userestrictions are distinguishable from interest in real estate, such as easements. Alternatively, it maybe that <strong>the</strong> titleinsurance companies are concerned that if <strong>the</strong>y insure over or remove building and use restrictions from title insurancepolicies, <strong>the</strong>y subject <strong>the</strong>mselves <strong>to</strong> potential litigation. Hence, that issue remains <strong>to</strong> be resolved under <strong>the</strong> 40-yearMarketable Title Act.Summary of Legal Considerations for Sale of Real Property letter by AmandaVanDusen, Miller, Canfield, Paddock & S<strong>to</strong>ne-February 24, 2010.The above noted letter is an at<strong>to</strong>rney-client privilege letter concerning considerations forSale of Real Property (attached under separate cover). You may recall that:1. We do not have <strong>to</strong> advertise or seek bids in connection with <strong>the</strong> sale of property.2. The Revised School Code states:a. “Unless approved by <strong>the</strong> state board, a school board or intermediate schoolboard shall not impose any deed restriction prohibiting, or o<strong>the</strong>rwiseprohibit, property sold or transferred by <strong>the</strong> school board or intermediateschool board from being used for any lawful public education purpose.Any deed restriction or o<strong>the</strong>r prohibition in effect as of <strong>the</strong> effective dateof this subsection is void.” Mrs. VanDusen confirms that charter schoolsare public schools.b. “If a school board or intermediate school board offers property of <strong>the</strong>school board or intermediate school board for lease or rent, <strong>the</strong> schoolboard or intermediate school board shall not refuse <strong>to</strong> lease or rent <strong>the</strong>property <strong>to</strong> a person solely because <strong>the</strong> person intends <strong>to</strong> use <strong>the</strong> propertyfor an educational purpose, if <strong>the</strong> intent of <strong>the</strong> person is <strong>to</strong> use <strong>the</strong>property for a lawful education purpose.”3. The Michigan Constitution prohibits <strong>the</strong> District from disposing of property <strong>to</strong> aprivate entity, including a non-profit, without consideration. While considerationdoes not have <strong>to</strong> be monetary or can have multiple elements, sale <strong>to</strong> a privateentity without adequate consideration constitutes a lending of credit.4. The District is not subject <strong>to</strong> most zoning regulations, but a developer, buyer orlessee may not enjoy an exemption.5. There are federal tax laws that, if triggered, could cause <strong>the</strong> District’s outstandingbonds, if any, <strong>to</strong> become taxable. The only school this affects is Wooddale9

Mrs. VanDusen did indicate in separate correspondence <strong>to</strong> me that <strong>the</strong> District couldagree <strong>to</strong> sell or lease with <strong>the</strong> stipulation that <strong>the</strong> District would have first right ofrepurchase if it were <strong>to</strong> be offered for sale or lease. She indicates this is not a perfectsolution and could hinder <strong>the</strong> sale and <strong>the</strong> value of <strong>the</strong> site. A legal review would beneeded prior <strong>to</strong> any such lease or sale. Also, we point out that in this case <strong>the</strong> Districtwould have <strong>to</strong> come up with <strong>the</strong> money should <strong>the</strong> property revert back <strong>to</strong> <strong>the</strong> District.PROS FOR DEMOLITION Reduces immediate liability Eliminates Facilities Management time <strong>to</strong> maintain and moni<strong>to</strong>r building Less staff time spent marketing; responding <strong>to</strong> inquiries End of fur<strong>the</strong>r structure deterioration and neighborhood blight Current zoning restricts redevelopment options Poor economy <strong>to</strong> sell property Can reuse fixed building equipment; chillers, boilers, casework, etc (seediscussion below) Fairview and William Grace can only be used for school purposes or residentialuse Wooddale in middle of subdivision William Grace, on a secondary road, is a good location for a future schoolCONS FOR DEMOLITION Public may like <strong>to</strong> see reuse City may like <strong>to</strong> see reuse Upfront cost of demolition If enrollment increases, we would not have a school <strong>to</strong> useReuse of School EquipmentWe have carefully investigated and are continuing <strong>to</strong> investigate utilizing much of <strong>the</strong>mechanical equipment for needed projects from <strong>the</strong> closed sites and <strong>to</strong> “recycle <strong>the</strong>iruseful lives” in<strong>to</strong> <strong>the</strong> remaining facilities. This saves money on <strong>the</strong> purchase of newequipment and contributes <strong>to</strong> reuse of equipment.Power, Warner, OED, and East – Install relocated casework from closed elementarysites and Fairview-$215,000Just as we utilized casework from <strong>the</strong> closed sites for Power and Warner reconfiguredspaces this past summer; we would like <strong>to</strong> continue that effort and install much of <strong>the</strong>remaining casework from <strong>the</strong> five sites. We have investigated both Power and Warnersites. Power could benefit greatly from media center shelving installed in <strong>the</strong> classroomsfor additional bookcase space. Presently <strong>the</strong> existing Power casework can be refurbished10

in place by FPS staff as most of it is in surprisingly good condition and is ample. Thecasework is not as extensive at Warner and is in poorer condition and we are proposingfor it <strong>to</strong> be replaced and could also benefit greatly from media center shelving installed in<strong>the</strong> classrooms for additional bookcase space. The casework at OED & East is in poorcondition. A survey will be conducted of Power and Warner and <strong>the</strong> remainingcasework will be installed here. The savings is estimated at $150,000 <strong>to</strong> $170,000.Elementary sites – Relocate gym backs<strong>to</strong>ps from closed sites-$6,000The backs<strong>to</strong>ps at <strong>the</strong> five closed sites need <strong>to</strong> be evaluated as <strong>to</strong> <strong>the</strong>ir condition <strong>to</strong> berelocated at <strong>the</strong> remaining sites. The estimated of cost of a replacing with new backs<strong>to</strong>psis about $3,000 per site. (It is undetermined at this time how many we will be replacing,but we estimate two.)Boilers and Chillers-We would like <strong>to</strong> salvage <strong>the</strong> two boilers from Flanders and Wooddale and <strong>the</strong> chillerfrom William Grace for parts which are highly expensive. We are already in <strong>the</strong> processof relocating <strong>the</strong> chiller from Wooddale <strong>to</strong> Highmeadow.Highmeadow – Chiller replacement-$25,000This 2000, 64 <strong>to</strong>n York chiller has had 2 compressors fail and has been less reliable thanits Trane competi<strong>to</strong>r. This project proposes <strong>to</strong> replace this chiller with <strong>the</strong> more reliable70 <strong>to</strong>n Trane unit from Wooddale. We have had our Mechanical Engineer, MLSAssociates investigate both sites <strong>to</strong> assure <strong>the</strong> capacity is adequate and have had <strong>the</strong>manufacturer evaluate <strong>the</strong> chiller’s condition at Wooddale. FPS has begun this project.O<strong>the</strong>r items for reuse-Such as, but not limited, <strong>to</strong> circulating pumps, fob readers, glass basketball backboards,clock systems, white boards, gym lighting at Eagle and energy management controls.11