…AND THE RESOLUTION WE WILL BE CONSIDERING

RESOLUTION

WHEREAS, Pursuant to District Policy 3195 –Disposal of School District Property, All property sold shall contain a deed restriction prohibiting the property’s future use as a school or other E-12 educational facility.

WHEREAS, Pursuant to District Policy 8120 –Disposal of School Board Properties, Property shall not be released without knowledge of its proposed utilization, and no property is to be released for the purpose or subsequent purpose of usage as a school other than ISD 709. By contract, such violation shall result in the property reverting back to ISD 709.

WHEREAS, In order to consider offers to purchase School District property for the utilization as a E-12 educational facility, the School Board must suspend District Policies 3195 and 8120.

WHEREAS, The School Board of ISD 709 has received a proposal for $14.2 million from Tischer Creek Duluth Building Co., a nonprofit entity affiliated with North Star and Raleigh Charter Schools, for the Central High School site.

WHEREAS, Incomplete information or misinformation was cited as reasons for voting in a certain way in the March 31 meeting.

WHEREAS, New information has surfaced that could potentially change reasons to vote a certain way including, but not limited to: Assessed values, realtor opinions and public opinions.

WHEREAS, the fact that the land value of the Central High School site was assessed at only $8 million in the 2006 evaluation by Ramsland and Vigen, Inc. This is the most recent property assessment, and was conducted during a peak in property values in Duluth.

WHEREAS, The School Board of ISD 709 has adopted a civility resolution where we will show your evidence and share your reasoning.

THEREFORE, BE IT RESOLVED THAT In order to fully investigate the offer, the School Board directs the Administration and School Board to initiate negotiations with Tisher Creek Duluth Building Co. to devise for the School Board’s consideration the most favorable mutual conditions for said sale including, but not limited to: provisions for enrollment caps, possible withholding of some parcels of the whole property from inclusion, potential joint usage of existing buildings, and an acceptable price for the purchase.

THEREFORE, BE IT RESOLVED THAT the School Board of Independent School District 709, St. Louis County, Minnesota shall suspend District Policies 3195 and 8120 in order to consider negotiating the current offer from Tischer Creek Duluth Building Co. for the Central High School site.

THEREFORE, BE IT RESOLVED THAT
the School Board of Independent School District 709, St. Louis County, Minnesota shall have an agenda item on a special board meeting to be held preferably by May 9th but no later than the May 17th regular school board meeting on whether to sell the Central High School site to Tischer Creek Duluth Building Co.


Motion made by:__________________ Seconded by:__________________

Ayes:________Nays: __________

Motion [passes] [fails]

B-5-16-3364 May 2, 2016

Meeting next Monday at 6:30pm at Old Central

I just put this call in the mail and sent it to the Superintendent and the members of the Duluth School Board:

April 26, 2016

Chairperson Annie Harala
Clerk Rosie Loeffler-Kemp
Vice Chairperson David Kirby
Treasurer Nora Sandstad
Member Alanna Oswald
Member Harry Welty
Member Art Johnston
Superintendent William Gronseth

School Board
ISD 709, Duluth Public Schools
215 N. 1st. Av. East
Duluth, MN 55802

Dear School Board Members,

The undersigned Members of the School Board of ISD 709, Duluth Public Schools, hereby call a Special Meeting of the School Board of ISD 709 on Monday, May 2, at 6:30 pm at the boardroom at Historic Old Central High School. This is under authority of Minn. Statue 123B.09, Subd. 6.

The following shall be the agenda for this Special Meeting:
1. Call to Order
2. Roll Call
3. Presentation by the Superintendent on the Potential of Disposing of Central High School/STC Site, 800 East Central Entrance, Duluth, MN
4. Receiving of Public Comments Related to Property Disposal of Central High School/STC Site, 800 East Central Entrance, Duluth, MN
5. Resolution B-5-16-3363 -Executive (Closed) Session
6. Recess to Executive (Closed) Session -Discussion Related to PropertyDisposals [Minn. Stat. 13D.05, subd. 3.(c)] involving undisclosed sale negotiation items.
7. Reconvene to Special School Board Meeting
8. Questions and comments by the School Board concerning potential said sale.
9. Resolution B-5-16-3364 Directing the School District to Enter into negotiations with Tischer Creek Duluth Building Co. of Said Property and Suspension of Policies 3195 and 8120.
10. Adjournment

School Board Members, ISD 709:

Alanna Oswald, Harry Welty, Art Johnston

A much wiser and more knowledgeble voice schools me on Reservation land

Your blog post yesterday about Fond du Lac is based on quite a bit of misinformation. If I may, I’d like to provide some information that might hopefully help clear things up.

The feds aren’t “allowing” the tribe to buy anything. The tribe is free to buy any property it wants to, just like anyone else. Case in point, they had already purchased the Carter Hotel quite some time ago without any approval required from anybody. They purchased the Sears building that now houses the casino in the same way. (A common misconception is that the city was involved with that sale, but it wasn’t. That was a private sale.)

In most cases, such off-reservation acquisitions are “fee land” (i.e., the tribe is the owner and they pay taxes on it). Fond du Lac owns fee land scattered throughout the region (much of it is actually undeveloped land that they purchased to preserve habitat). What the feds did, first with the Sears building and now with the Carter Hotel, was place the land into tribal trust. Fee-to-trust transfers are done at the sole discretion of the Department of the Interior. So, you’re correct when you say the city wasn’t engaging in charity by “letting” the tribe open a casino—but only because the city had absolutely no authority in the matter. City officials get very testy when this is pointed out, but it’s nonetheless true. I got confirmation of it straight from the Department of the Interior: Local governments, including Duluth, have never had any say whatsoever in tribal trust decisions.

On its face, that might not seem fair, but there are two important points to understanding what tribal trust is all about:
(1) Tribes don’t own trust land, including their reservation land. The federal government owns it and holds it in trust on behalf of the tribe. This is why tribes don’t pay taxes on trust land—because it’s owned by the feds, not by the tribe.

(2) Fee-to-trust transfers are mostly used Continue reading

History repeats itself

There was yet another letter criticizing the Duluth School Board in today’s DNT. Key lines:

“As I recall, it was 1966 when the board insisted we have a new Central, and the push was made for building on the top of the hill. That school was used for many years. Then the board decided to do it again with the Red Plan. Now, it seems, history is repeating itself with the School Board deciding against the will of the people again.”

I often remark that any school board (or any elective body for that matter) is always saddled with the sins of its past. Our current school board is in the process of saddling its successors yet again with the decisions its making today. I used to carry a school board business card with Santayana’s observation that “Those who do not remember the past are condemned to repeat it.” It had a picture of my gorilla, “Phil,” on the other side.

This will be on my mind as I write up another post or two today. But first, I must attend to personal matters.

BTW – A hearty welcome to all my new (or returning) readers.

Repurposing old schools

A friend emailed me an interesting web page concerning repurposed schools in Duluth. The Zenith City crew put this up a couple years ago. It shows most if not all old ISD 709 schools some Catholic Schools and some old Duluth Normal School buildings and explains how they are used today.

At the end it does make one mistake writing that:

“At this writing, Nettleton Elementary School, Chester Park Elementary School, Morgan Park High School, and the 1971 Duluth Central High School sit unused. Lakeview Christian Academy, which is currently housed in the former Lowell Elementary School, has offered to purchase the 1971 high school, but so far Duluth’s school board has said no, in part because it says it does not want to sell to a “competing” school. The adapted reuse of Cobb, Lakeside, Lowell, and Washburn Elementary Schools indicates that “competing school” policy applies only to the Central High facility,which sit on a very valuable piece of real estate looking out over Lake Superior and the St. Louis Bay.”

In fact the schools mentioned above were sold before a clause was added to ISD 709 school board policy forbidding sales of schools to “competitors.”

ALSO ANOTHER FRIEND NOTED THAT AT THIS WEBSITE’S POSTING CHESTER PARK WAS OWNED BY UMD.

Its worth noting that the buyers of these schools represented lots of taxpayers who helped support the Duluth Public Schools even though they sent their children to Parochial or other schools.

Correction on last post

In the previous post I mentioned that Rep. Erik Simonson was flying in to St. Louis with Denfeld principal Sconniers to root for the Denfeld Robotic’s Team. Wrong! It’s the Activities Director, Tom Pearson, who is flying in with the Principal. That makes more sense.

I don’t always wait in the blog to pass on information I find interesting. This is one of the drawbacks to instant communication. Rather than erase the traces of my mistakes I prefer to highlight them to keep me humble. That way I don’t have to gush too much about my human frailty.

Perhaps the opposite of my tact is the one employed by veteran School Board commentator Loren Martell who anguishes about his mistakes when he makes them in the Duluth Reader. BTW. I like that about Loren.

In a column a couple weeks ago he wrote that Board Chair Annie Harala was a teacher employed by the Duluth Schools. I was the one to tell him it wasn’t so and he damn near withered away on me he was so distraught.

Here is his apology in the subsequent column. Its a doozey:

Striving for accuracy and eating crow Continue reading

Gambling on Central

I will have a busy morning of blogging once again based on stories in today’s Trib. But first an old story from 2012 sent to me once again by my old Let Duluth Vote ally. Its part of the continuing story related to decisions made by the City of Duluth for development of the Central location. I found this sentence near the end particularly interesting as it ties in with one of today’s Trib stories related to the threat of the Fon du Lac Reservation becoming a tax free cancer inside Duluth:

“One resident brought up a popular rumor about the site, that it could become home to a casino. Hamre said the business park classification would not allow for such a use. It’s a protection city planners were careful with after public discussions last year, Hamre said.”

NOTE: This 2012 article begins at the end of this post and is posted in full.

I am troubled that the Feds are allowing Fon du Lac the power to buy up downtown Duluth and make it soverign reservation land free from Duluth’s taxes or regulation. Of course, on the one hand I think to myself of the poetic justice this inflicts on the larger europeanized culture that “stole” the land from native Americans but on the other I can see a devastating threat that such a tax loophole would pose. It would advantage all manner of developers who the Casino might bring in to build in what may become a prime tourist area in the years ahead. Under this Federal restriction, the City would be powerless to prevent Fon du Lac from waging a potent economic war against the City and non Reservation businesses.

I’ll be the first to admit that the original agreement thirty years ago to let the Casino be set up in Duluth’s downtown was not an act of charity on the City’s part. I will also acknowledge that some of our politicians of that Era may have been condescending towards their Fon du Lac partners. But that hardly excuses the Reservation being granted the power to be equally contemptuous of the needs of Duluth. I’m not sure our new Mayor Emily Larson has what it takes to defend the City’s rights in court where the fight against this threat should be made. BTW. I’m pretty sure that Wally Dupuis, who took over from Karen Diver used to be a student of mine in the Proctor Schools.

Not that losing tax base is all that big a deal. Central is likely to be sold to someone as a TIF District which could exempt it from paying property taxes for up to a quarter century or more. And today another story demonstrates how eager Rep. Simonson is to give the site away to a developer by excusing them from paying sales taxes on any construction they undertake on the site.

I see that Chair Harala accompanied Supt. Gronseth to St. Paul to defend the deferred sales tax. She’s a busy person having also stayed with the rest of the Board through over three hours of testimony last night on the possible threat of rubber mulch on our playgrounds.

I could thoroughly understand her lack of enthusiasm when I handed her the prospective call from three minority members for another long meeting next Monday night over a renewed discussion of our policy forbidding a sale of Central to a competing school. Unlike one of the Board members who breezed into last night’s meeting fifteen minutes late and left a little over half way through the meeting Chair Harala doggedly sat through the entire discussion with the rest of us sans Alanna Oswald. Alanna drove down to St. Louis to watch the Denfeld Robotic’s team on which her son is a member and which she helps coach. Here’s today’s Trib story on that.

Ms. Oswald will not be the only local in the cheering section. Rep. Simonson is flying down today NOTE CORRECTION with Principal Sconiers to witness the achievement and competition. I guess Erik is now the official savior of Denfeld although I don’t know how preventing an agreement with the DPSA Charter Board to put a cap on its future enrollment gives Denfeld any long term protection. My email Buddy sent me an email with a link to this story in the Trib asking me if this wasn’t some sort of “shell game” over taxes. I told him I didn’t thing shell game was the most apt description. The glorious Central site is fast becoming the School District’s white elephant. The original “white elephants” were sacred elephants that the Siamese King gave to his rivals in the Kingdon knowing that their upkeep would bankrupt them.

Here’s that story from the

DNT, April 27, 2012

Duluth school district officials say they’re encouraged by revisions to the city’s plan for redeveloping the former Central High School site after an early plan left them concerned the site would be hard to sell. Continue reading

Chopped Liver

Pretty Picture huh?

I just found this in the 30 page report that ISD 709 paid for when an alert reader sent a story to me about this evaluation of the Central location. I immediately put in a demand/request to see it and today it was sent to me and the other school board members. Actually, ISD 709 will pay DEDA for our half of the cost of the report when we sell the Central site.

We have been talking about selling Central for two years and more since I got on the School Board. In the last six weeks that discussion has become heated. Yesterday I argued with a School Board colleague about whether our Board had been given all the information it needed to make a decision to sell the property. I argued that it had not been provided let alone discussed in public. My colleague was convinced that we had heard everything of importance to justify the 3-4 vote we rushed to decline a $14.2 million dollar offer.

This report, never to my knowledge shared with the School Board, is pretty damning evidence that we as a Board are or have been kept clueless. Its not an exhaustive report and it is speculative. What could we do with all 77 acres. It argues that only a little over 30 of the acres are develop-able. I presume that this is above the existing footprint of the existing schools. And yet it argues against developing some of the land that is currently forest because it is an important barrier to prevent flooding during heavy rains. I would like to have known that. If anything it would make me want to put a proviso in a sale preventing such development.

It also throws water on the reuse of Central High itself. It presumes the school will be demolished…..not a surprise from recent discussions.

The picture above is of a “switchback” like road for residential development from the lip of the hill down to other residential areas. It looks rather like San Francisco’s Lombard street in this diagram. Its made to entice a developer but one nibbled at the whole site for $10 million and dropped the offer. Some of the Board members seem to be hanging on to this site like stockholders to worthless stock just in case the market makes a come back. We aren’t developers.

The fellow who bought the Woodland site for $3 million, which we hoped to sell for $6 million, turned around and sold a small parcel of the site to St. Scholastica for over $2 million. He’s a developer. He’s fleet enough of foot to have done what we would be hard pressed to do. As for the Board. Well, the Administration’s seeming reluctance to answer our questions makes me feel like chopped liver.

I fought the law

As I was belatedly putting away my Mother’s christmas ornaments this morning I was thinking about how strange it is that I’ve developed a reputation for being something of a hell raiser. I don’t think I’m a whit different inside than I was back in my school days. Back then I was a bit of a goody-two-shoes.

I still remember the most daring thing I did all through-out high school that violated school policy. As a senior I let myself get badgered into taking a fake hall pass into Mrs. Beech’s classroom to give to Barb Shelhorn. It was spring so I almost got through four years of high school without a misdemeanor but I let Jim Robinson harangue me into it. I was minding my own business, probably in a study hall, when he handed me a pink hall pass with Barb’s name and some forged adult’s signature. He asked me to go to Beech’s class, knock on the door and say I had a pass for Barb. Mrs. Beech looked at me hard when I did this but let me come into her class to give Barb the pass. Barb left with me and met Jim in the hallway.

It was not exactly Ferris Beuhler’s Day Off. Sample Dialogue: “Oh, I’m sorry. I can’t come to the door right now. I’m afraid that in my weakened condition, I could take a nasty spill down the stairs and subject myself to further school absences.” But today I’m rather more enamored of Ferris at least compared to the stifling of creativity by orthodoxy.

Ah, but pardon me. I must go out an buy the latest copy of Robert’s Rules of Order Newly Revised. It’s in its 11th edition. I did like to sing “I fought the law but the law won” by the Bobby Fuller Four but I’m still not a rebel. It was a horrible song and so damned singable.

Today’s Dogpile

Its been almost a month since the School Board voted 4 – 3 not to enter into negotiations with the Tischer Creek Building Corporation. If I had had my way the community discussion would have been over with last Tuesday at our School Board meeting. Instead it continues after the slam dunk the board majority engineered 4 days after taking public feedback at Lincoln Middle School to stop the conversation before it really began. In this we are not unlike the Egyptians who yesterday protested the nation’s latest elected dictator accusing him of, well, dictatorial rule.

I just linked to NRP for that story but another NPR story was more interesting to me. It is about the connection between spending money and successful schools. It goes back to Massachusetts under one of my favorite Republicans of that era, William Weld. Weld was one of many moderate or liberal Republicans purged by the Limbaughites of the current GOP who only kept the zipped lip moderates who let Donald Trump loose with their sheep-like, Bourgeois complacency. They used to have their own champions and Weld was one of the last of them. Anyway, according to the story, Weld’s education reforms did wonders for Massachusetts’ poor kids. Today’s Minnesota Republicans are more hold the line on public school funding.

The Duluth School Board took it on the chin again today in the Trib. Another front page story about Woodland Hills considering a Charter School demonstrates that a badly discredited ISD 709 fighting the Edison Charters was the best publicity Charter Schools could have hoped for. Woodland Hills is a remarkable school for troubled kids. Bill Westholm and my wife, Claudia, were both on its Board of Directors back when I was first on the Duluth School Board. Local kids end up in its day treatment schooling and juvenile courts all across Minnesota send troubled kids to WH for 9 month stays. Like yesterday’s story about the Arch Diocese contemplating a high school this is one more indication that an all too insular ISD 709 is not meeting expectations. DFT President Burnham may lose another dozen teachers if the Charter goes through.

But it was the Editorial Page that really stung. Its top op ed piece came from an Edison parent who echoed so many 1950’s musicals wishing that the public school systems in Duluth could get along instead of fighting like Bernstein’s Sharks and Jets. Or from Roger’s and Hammerstein, if I can paraphrase, Oh the Charters and the Indies should be friends. In Oklahoma its Farmers and Cowboys but you get my point.

Another Op Ed talked about “little Sally” a student that the teacher’s unions and school boards had all but forgotten about in their war to control the schools.

“See, there’s the problem. This shouldn’t have been about the School Board. It was about Sally. It wasn’t even about what the School Board thinks is best for the children. That’s up to the parents, guardians or protective service. In that order.”

The author went on to praise vouchers but I don’t have it in me to take that up in this post. My Buddy and I have argued over vouchers for a decade or more.

But again its the letters that just won’t stop. This time one heaped shame on some of my colleagues.

Heck the School board censured me a little over a year ago and I didn’t catch nearly as much hell. Not that I’m crowing. My Mom always told me it takes two to have a fight.

Central’s Value

Here’s a link to that email as it was sent to the Board describing how dependent the financing of the Red Plan was on selling our old schools. And how short we’ve fallen in those sales.

While our administration has not always been johnny on the spot about providing background info for we members of the Board minority I have made lots of very smart friends in my years of bird dogging the District and its ambitious plans. When one of them pointed out a 2012 DEDA report I put in a request to see it and yesterday read that it was soon to be provided to the entire school board. Similarly, my old ally found another article from that year which gives some background about how the City viewed the 77 acres of the Central site. Draw from it your own conclusions:

DNT, April 26, 2012

Duluth city planners, school district to discuss Central High site

A modified plan for land use at the former Central High School site off East Central Entrance will be discussed tonight at a public meeting.

Duluth city planners and representatives from the school district will talk with residents beginning at 5:30 p.m. in City Council chambers on the third floor of City Hall.

The city’s planning division has been working on the 77-acre site plan for the last two years; changes were made after the school district complained in January that the zoning had too little commercial area to get the best price from a potential developer.

The School Board sent the city three reasons it wanted the Planning Commission to hold off on recommending the plan:

•The plan did not fit with the district’s long-range plan for the Central site, namely that it get the most money it can from a developer “based on its highest and best use other than a school.”

•The district says the city plan “randomly divides” the 77-acre parcel without regard to existing platting, which the district said devalues the property.

•Without getting the best price for the property, property taxes would increase, something not in the public interest.

The original plan set aside 25 acres zoned for a business park at the site. The revised plan boosts that acreage to 43 acres. Conversely, the acreage for residential development went down to 12 acres from 14 and recreation land went to 25 acres from 34.

Before talks with the city, the school district drew up a plan that raised the developable acres to 66 from the city’s 39. The compromise acreage is now 55.

Comments from the meeting will be compiled and presented to the Planning Commission and School Board.

Planning division and Planning Commission members said in January that their decisions were not based on getting the most value from a site but on proper mixed-use zoning.

Any development on the site will still have to go through the zoning process when specific projects arise.

Why did we build the new Lincoln Middle School?

Why are we faced with the prospect of selling Central and its property at such a low margin? I am borrowing heavily from an email conversation with Art Johnston about that question today.

Back in 2009 in our District’s Review and Comment presentation to the Minnesota Department of Education we hadn’t yet decided where a new Middle school for western Duluth would go. Central had only one obvious problem. It was not central for western Duluth.

Even so it was the most highly rated site of four then evaluated (Central HS, Arlington, Wheeler (final SB selection), and a Raleigh site. (Morgan Park equally off center was not even on the list in large measure because Member Grover was strongly opposed to sending Piedmont kids on such a long bus ride west.)

Tables showing the pros and cons of the four sites came up with a number to express their relative ranking. The Central HS site had the highest rating (49+77 = 126) of the four. And the final selected site (Wheeler) only had 104:

Central site: 126
Arlington: 124
Wheeler: 104
Raleigh: 99.

Clearly, even JCI and LHB rated the current Central Site as a much better location for a MS than the current (Wheeler) site.

If Central had been made the site of the MS, we wouldn’t be having any of this discussion and would still be using the Central Site and the STC.

This shows how one bad decision compounded another, until we are in the mess we are now.

As another person on this email thread noted it is possible that were counting on a sale of the reputedly valuable Central site to help finance the Red Plan. Of course, had we repurposed Central as a Middle School it would have been vastly less expensive than building the new Lincoln on its own inaccessible, rocky promontory. Another draw back – hardly any children live within walking distance to Lincoln, just dozens.

How sad to now learn that the entire 77 acres of Central’s land is only listed as being worth possibly $8 million dollars. Minus a two million cost of demolishing Central High that’s down to a $6 million value just a little over a one-third of what Tischer Creek was prepared to offer ISD 709.

ISD 709, The latest threat?

The banner headline in today’s Trib pretty well astounded me: Duluth Diocese considers new Catholic high school. It begins:

The Duluth Diocese is considering restructuring existing Catholic schools in Duluth and possibly opening a Catholic high school in the city for the first time in more than 40 years.

The story itself is probably not that much of a threat to ISD 709. There are fewer than 700 students in Duluth proper’s Catholic schools and the number of students they think they might add from 9th to 12th grade is just above negligible, around 30 per grade. Plus, its not easy to start a new school especially with numbers like these. As a non public school it will largely be tuition based and I presume tuition for a high school will be higher than for elementary grades although I don’t know that for sure. The Catholic schools no longer have access to so many priests and nuns to teach without salaries.

These are the optics. The Catholic church, so badly discredited for years of betraying children, is considering making a comeback in secondary schooling in Duluth. Really? If ISD 709 wasn’t having such a hard time I can’t imagine it would occur to the Duluth Dioceses to consider such a proposal.

I feel like an ancient mastodon stuck in the la Brea tar pits with vultures landing on my back and dire wolves circling the pit’s edge.

Why we didn’t sell summed up in today’s letter to the Editor

Letter writer Marcia Gurno nails it:

“For 20 years Duluth’s anti-charter school stance has been led by the teachers union and the local DFL. The sale of Central seemed no different, with teachers union representatives speaking against the sale from talking points distributed by the state and local unions.”

This is not terribly different than the five year struggle to curb the City’s $330 million pension liability. The unions wanted every cent of it and more no matter how ruinous this would have been for taxpayers. In this case the clear economic benefits of the Central sale for 40% more than the value of the property is completely out weighed for the public employee unions by the symbol of an “Edison” school smack dab in the middle of town. The symbolism trumps (and that’s a perfect word for it) the financial rescue of the ISD 709 schools and the promises made by Red Planners ten years ago.

Here, in its entirety, is an email we school board members received today from one of the handful of municipal finance experts in Duluth and a Central Grad to boot, Chris Virta: (sorry the graphs don’t translate here. I will post a link to them later today.)

Dear School Board,

As a 3rd generation ISD 709 alum and young parent, as well as someone who works on economic development with cities, counties, HRAs, and EDAs, I felt compelled to write to the board about the current offer for Central, explain why the failure to sell Central to date is significantly contributing to the district’s financial challenges, and also explain why the sale of Central to a private developer will not generate property tax revenue for the district until long after the Red Plan has been paid off in full. As a non-partisan school board, the offer for Central has nothing to do with politics, but it does have everything to do with fulfilling the board’s obligation to follow the Red Plan and sell Central. Here’s why:

The Appraisal that Matters
The most important valuation of Central is the disposition value of $10 million found in the Red Plan. This valuation is important because it represents an amount the district borrowed and spent in anticipation of selling Central for $10 million. To date, the district has never sold a property for less than 55% off the disposition value listed in the Red Plan. In addition, the TIF districts created for the Woodland Middle School and Lincoln Park Elementary developments will not expire until after the Red Plan debt is completely paid off. This means that these developments, while wonderful for the Duluth community, have actually contributed to the district’s financial challenges by generating $4,309,999 less than what the district borrowed and spent.

Property Sale Report Card

Woodland Middle School
Sale Price
Red Plan Valuation
Variance
Discount
Subsidy
$3,000,000*
$6,700,000
-$3,700,000
55% Off
26 Year TIF District
Description of Incentive: Developer gets $9,896,864 in TIF plus interest at 6% until developer is paid in full.

*Note: Developer subsequently sold 3.6 acres to St. Scholastica for $2.58 Million. Quote in the paper regarding the St. Scholastica sale: “The appraised value was actually higher, and Mark Lambert made a donation to the college to make up the difference.” (Construction is bustling at BlueStone in Duluth, September 7, 2015)

Lincoln Park Elementary
Sale Price
Red Plan Valuation
Variance
Discount
Subsidy
$1
$610,000
-$609,999
99.99% Off
26 Year TIF District
Description of Incentive: Developer gets $522,424 in TIF plus interest at 5.50% until developer is paid in full.

“[Leider] said $1 was the price because of the high costs of turning around a building like Lincoln, which needs significant work.” (Lincoln Park School in Duluth will be sold for $1, September 1, 2011)

Morgan Park Middle School
Sale Price
Red Plan Valuation
Variance
Discount
Subsidy
$100,000
$500,000
-$400,000
80% Off
None.

“The value of demolition is weighed against the cost of the property, Leider said, and the offer of $100,000 is considered by the School Board and administration to be “reasonable.” (Morgan Park Middle School will sell for $100,000, July 14, 2015)

Piedmont Elementary School
Sale Price
Red Plan Valuation
Variance
Discount
Subsidy
$0 (Torn Down)
$280,000
-$280,000
N/A
N/A

Hypothetical Central Sale (based on Woodland Middle School ratios)
Sale Price
Red Plan Valuation
Variance
Discount
Subsidy
$4,500,000*
$10,000,000
-$5,500,000
55% Off
26 Year TIF District
Description of Incentive: Developer gets $14,845,296 in TIF plus interest at 6% until developer is paid in full.

“Ness said the city was committed to helping with site infrastructure and improvements, but a ‘significant’ amount was needed.” (Purchase agreement for Duluth Central High School site falls through, June 30, 2015.)

Property Sale Deficit
To date, actual property sales have only generated $3,100,001 for buildings that were valued at $8,090,000 in the Red Plan. The sale of Central for $14.2 Million would not only be the district’s first sale at a profit, but the $4.2 million (or 42% premium) to the Red Plan valuation would fill 84% of the $4,989,999 deficit created by the sales of Woodland, Morgan Park, Lincoln Park, and the non-sale of Piedmont. Why does this deficit matter? Because of a certain type of lease purchase debt used to finance a portion of the Red Plan.

Lease Purchase Debt Problem
As part of the Red Plan, the district issued $43,345,000 in lease payment debt that the district is prohibited from levying a property tax for by state statute. Instead, these lease payments are made annually by appropriation and are “financed by the sale of unused district properties, proceeds of which are estimated at $23.3 million, utility rebates, general fund operational savings and other district funds over the term of the lease,” (as stated in the MDE review and comment). To date, the district has only generated $3,100,001 of the $23.3 million in property sales required by the Red Plan even though the district has paid as of March 1, 2016, $18,482,261.28 in lease payments since September 1, 2010 (most of which is interest).

For FY17, the district is facing a $3.3 million operating deficit and is also faced with making a $3,370,935 lease payment out of the general fund to service the above referenced debt. To the extent money is not available from property sales, utility rebates, and operational savings, the money to make this payment has to come from “other district funds.” This means money that should otherwise be spent “in the classroom” has to be spent “on the classroom,“ which only perpetuates the district’s financial problem that causes more students to leave the district because of reduced offerings. Unfortunately, these annual lease payments continue until FY2032, which means these payments continue for 16 more years.

Chris Virta (no charter school affiliation)
District #2

P.S. If the board decides Central is worth $30 million, based on the 55% Woodland discount, the board should charge Tischer Creek $13.5 million.

No SB mtg. Monday

Chair Harala and I will be chatting on Monday about the School Board of ISD 709 having one last discussion of reopening negotiations for an immediate sale of the Central property to the Tischer Creek Building Company. The City of Duluth has unwittingly given the School Board a little more time to consider this. I will most assuredly keep my readers appraised of the results.

Taking a pin to my pompous balloon

Yeah, this email reaction to my white lie post from a sympathizer just about sums it up:

“Harry, except for talking too much, you are a real asset to our community.”

My Buddy was a little less charitable offering me an alternative adage:

“Bullshit might make the grass grow green, but . . .”

He refrains from completing his proffered quote but I imagine that it would conclude something like this: … too much will kill the grass.

My Buddy gets great satisfaction from his disgust of bullshit. I rather admire him for that.

Meanwhile yet another ally heading off to the DFL convention today to choose between Sharla Gardner and Rep. Simonson for the State Senate endorsement sent me a very interesting Q & A. It was with the Author of the book What’s the Matter with Kansas which skewered Republicans. He’s got a new book out now skewering Democrats.

Maybe my real quarrel is with all the college-educated folks who insisted that spending half a billion bucks on new schools would lead to nirvana. Of course, at the time, all I could think of was the children’s fable about the Emperor’s new clothes. I’m sure the King’s courtiers and counselors all went to Ivy League schools and were pained to hear that only dolts could not see the King’s regal new attire.

BTW. I had great fun yesterday reading Dr. Seuss’s The Lorax to kindergartners through 2nd graders at Lakewood Elementary for Earth Day. It taught me that there are some things we really don’t thneed.

A Rosy Endorsement

In today’s Trib:

Erik Simonson gets my vote for Minnesota Senate District 7. He has the depth of knowledge and professional and personal experiences to continue to serve our community well. Simonson has built strong working relationships in St. Paul and across Duluth, brings four years of experience in the Legislature, and has been a leader on many diverse issues. His positive working relationships and connections with state departments are an asset to Duluth

As a parent of four children, I vote for candidates who understand the multitude of issues that impacts children and families. Simonson makes decisions that are well-informed and thoughtful.

As a Duluth School Board member and an advocate on education issues for more than 30 years, I support candidates who understand the importance of a strong public education system and the issues facing school staff, families and students. Simonson understands the socioeconomic disparities that create the opportunity gaps and that the community needs to help provide health, social and emotional support for students. Simonson is an advocate for funding early childhood education, investing in diverse post-secondary options, and making sure our schools are safe and supportive for all. Check out his track record at simonforsenate.com.

Rosie Loeffler-Kemp

Duluth

The writer represents District 1 on the Duluth School Board.

Thinking in Adages

I was named after a man my Dad was profoundly disappointed in, his father, Harry Welty.

There is it. After a couple hours of fervid thinking about anything and everything other than a memoir I woke up with a good first sentence for such a thing. I’m not sure of a second sentence to follow but it might be something like – I have lived with deep regret since his death thirty years ago that he left this world burdened with a profound disappointment in me too.

Although the second sentence is still in doubt that first one so naturally leads into a first chapter that it almost seems like a magic incantation. But I’m not here at my computer to write that chapter, let alone an autobiography. I feel immensely rested despite a mere four hours of sleep. I didn’t even toss and turn in the hours that followed. My mind simply raced from one potential post to the next. My dedicated readers will recognize this. War and Peace was a mere 560,000 words. It is dwarfed by this blog in verbiage if not content. This is my sanity. I pour some small portion of what’s on my mind in here to prevent me from hearing voices in my head.

Yesterday I thought of a good adage and, before forgetting, typed it into an email and pushed send to myseslf. This is it: “White lies are like clouds. Stack enough of them on top of each other and they won’t let any light in.” It could almost go without saying, but I’ll say it anyway, that recent events helped condense that bit of cumulus in my head.

In my first blog post yesterday I included about six titles for posts I wanted to write. I got to four or five of them. One had a list of miscellany that I didn’t get a round to blogging about. This morning has left me with a great many more among them, Why I didn’t check to see if my sister was OK after the Earthquake in Equador; An official record of how shot up my Grandfather was after WW I; How to keep Kansas sod from rotting when you are building a house; and this one – How Chair Harala and I are keeping it civil under our current duress. I’m sure the 375 readers this month who, according to my blog stats, spent over an hour reading my blog in a single sitting would like me to expound on that. In due course. In due course.

Yesterday I came closer to settling my future finances, raked the yard, worked into the night answering email and writing up what my church’s men’s club plans to do in the future for the Bulletin and joined my wife to watch the last 45 minutes of Some Like it Hot. What a funny movie that is and, for me, it keeps getting funnier. The host of TCM told an anecdote about it afterwards I found charming. Its director, Billy Wilder, screened it in front of 600 people who sat through it in stony silence except for one fellow who laughed all by himself all the way through it. The guy who laughed was one of my first television crushes, Steve Allen.

There, that does it. That’s all the stuff that kept me awake. Oh, except for mentioning that I will be spending Earth Day at Lakewood School reading Dr. Seuss’s The Lorax to first and second graders. That alone should make up for all the things I couldn’t stop thinking about while not tossing and turning – how I screwed up as a new teacher and disappointed my Dad on the eve of his death.

That was just one teacher’s travail. Now I feel like an entire school district’s fate hinges on how well I navigate the next few weeks – or years. As Jana Hollingsworth once told me: “It’s all about you.” Only, as far as ISD 709 is concerned, it really isn’t.

How an old PTA Mom eviscerates the political shenanigans of our local legislators

Dawn Silvestrini, a PTA Mom pretty well shellacs Rep. Schultz and Rep. Erik Simonson in her op ed piece:

Here’s a sample:

“Charter schools are public entities. It’s interesting Simonson and Schultz seemed concerned Minnesota taxpayers would be on the hook for lease payments for an Edison high school yet seem willing now to place those same taxpayers on the hook via sales and use tax exemptions for products used in a Central site redevelopment.”

The official source for all the blather of the eccentric Harry Welty – Duluth School Board member, off and on, since 1995. He does his best to live up to Mark Twain's assessment: "First God created the idiot. That was for practice. Then he invented the School Board."