Wednesday December 11, 2013
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I started reading about the school district selling Frontier Elementary School at a fraction of what it cost and ran across this line, "The PUSD board felt secure enough about the sale to start spending the money it anticipates getting."
I groaned. "Don't spend it! Keep it! You're going to need it!"
The next line I read?
"The board agreed to spend most of the money to expand the classroom capacity at Payson Elementary School (PES)."
And soon I read just what I feared was coming.
"[The new owner] said she does not anticipate renovating FES as the district made upgrades before the site was mothballed, including spending nearly $700,000 for upgrades from a still-not-paid-off bond issue."
I groaned again.
"If you need space why did you just sell a school?" I asked. "And why not at least pay off the bond? Does it make sense to spend the money you get from selling something you are still paying on instead of paying off the loan? Why keep on paying interest?"
If I ran my house like that Lolly and I would be living in a cardboard box back of Bashas.
What is going to happen in a year or two when people start coming here again in droves as before? Do you seriously think the state will look favorably upon a request for new space? Do you think there is a chance that the people of Payson are going to approve a new bond issue when they know that you muffed your chance to pay off the last one?
Take your cue from Sam Walton, who became the richest man in America by keeping his overhead down to 2 percent.
Am I wrong?
Aaaah Tom, I did the same groaning that you did!!! Of course you are not wrong!! Again, I hate to sound like a conspiracy theorist here, however, I think that some on the school board have their own agenda going. Why on earth would they sell a campus that cost a heck of a lot more to build and to upgrade than they were offered? And furthermore, will cost a whole heck of a lot MORE to replace when the time comes? And we ALL know that the time WILL come. We are in a slump now, but we are slowly coming back.
To late for this mess, but maybe we need a new school board.
I am sure the people that are serving on it would not do this with thier personal property.
They will be screaming the loudest when we need a new school and thier property taxes go up.
Are all elected people strange? Didn't the state sell the Capitol building not to long ago and now they are renting it?
This is the smelliest, most incompetent, misappropriation of public funds, gross negligence scenario going on in Payson right now! Outrageous!
Way to go, take publicly paid for property (at least seven million) and sell it for a fraction of its value to a private religious institution, at tax payer expense! Would another faith gotten as good of a deal? Is that school going to take poor kids? Will they help the homeless children? Will they take all religious faiths? How is this school going to benefit the 33% of the Payson Children that were attending that school? Will the teachers be paid better, with better benefits?
This transaction only benefits the few at the cost of the many, sounds like a familiar pattern reeking havoc on our society. Wake up Payson, or every future situation in this town will be just like this one.
I know there are some good people serving on that board, so I do not understand what has happened. It would not have cost a great deal to mothball the school and just let it sit. All you do is drain the pipes, clad windows with plywood where needed, and chain the doors. What's left to do? Not much. Mow the lawn. Make an occasional inspection....
I was there on Sampson AFB, New York, when it was closed in 1956. I saw the way the estimates of selling the base, returning it to the state, or mothballing it for a possible reopening, were done. The choice was to mothball the entire base.
I can duplicate the reasoning here.
I'll just grab some numbers for closing, mothballing, and maintaining the building, and for later reopening it. They are not meant to be absolutely accurate; but they are in the ballpark because I went out on the net and did some research. The critical question is how long the facility will be closed. I have set it at five years. For ten years the numbers change, but not as you might think they would. This, by the way, is how business, or the military, make decisions about such closures if there is a possibility of a reopening. The one thing I am going to leave out here is the cost of the interest on the loan to pay off the bond; that is the same whether you sell or keep the building, so it is immaterial.
Value of facility in 5 years.
A. Original cost of facility: $5,500,000
B. Added improvements: $1,600,000 (I had to estimate this, but it's close)
C. Accrued value since construction based on 5 year rate of inflation (0.66%): $234,000
D. Total current value: $7,334,000
E. Annual appreciation in value at current rate of inflation (2.76%): $202,418
F. Estimated 5 year cost of replacement: $8,346,090 (Current value plus inflation.)
Option One: Retain facility for 5 years:
G. Estimated period before facility reopens: 4 to 6 years.
H. Cost of closing facility: $127,000
I. Estimated cost of re-opening facility: $160,000
J. Cost of closure plus reopening (H + I): $287,000
K. Estimated annual cost of maintenance: $68,000. Five year cost: $340,000
L. Total costs; 5 year closure, maintenance, reopening plus 10% overrun: $689,700
Option Two: Gain by sale of facility:
M. Selling price: $1,200,000
N. Annual interest if sale price banked: $61,235
O. Total five year interest: $306,175
P. Savings over 5 year closure, maintenance, and reopening: $689,700
Q: Total assets re items M, O, P: $2,195,175
R. Cost of rebuilding minus assets (F minus Q): $6,150,915
Options One v. Option Two:
S. Savings by selecting Option one (R minus L): $5,461,215
Note: If the facility is closed for ten years instead of five years the savings will increase by roughly $670,000 due to the fact that the annual cost of maintenance is $134,000 less than the appreciation in the value of the building each year.
What would you do if it were your money?
Come to think of it, it is your money.
Ask the school board to provide a independent appraisal prior to the sell of this property. Who is doing the legal review?
Even if I were off with my numbers by a lot, and I don't see how that's possible, I can see no way that giving away over five millions bucks makes any kind of sense.
I am so mad I could bite nails in half. I called someone this afternoon to get the numbers on the cost of Frontier et al and told him what I was going to do with them, and how. He said, "Hey! Let me run those numbers for you!" So I did. When he called back I entered the data and posted it. An hour ago I got a call saying, "Gee! I'm sorry. I had my program set wrong."
THANKS A LOT. I ALREADY POSTED THE NUMBERS!
Fortunately it really doesn't make any difference in the bottom line, but here are the correct %$#@! numbers. They prove the same thing, but this time I ran them myself!
A. Original cost of facility: $3,790,000
B. Added improvements: $676,000
C. Accrued value since construction based on annual rate of inflation (2.4%): $1,607,760
D. Total current value: $6,073,760
E. Annual appreciation in value at current rate of inflation (2.3%): $139,696
F. Estimated 5 year cost of replacement: $6,770,242 (Current value plus inflation.)
K. Estimated annual cost of maintenance: $44,000. Five year cost: $220,000
L. Total costs; 5 year closure, maintenance, reopening plus 10% overrun: $529,000
P. Savings over 5 year closure, maintenance, and reopening: $529,700
Q: Total assets re items M, O, P: $2,035,875
R. Cost of rebuilding minus assets (F minus Q): $4,734,367
S. Savings by selecting Option one (R minus L): $4,205,367
Note: If the facility is closed for ten years instead of five years the savings will increase by roughly $478,480 due to the fact that the annual cost of maintenance is $95,696 less than the appreciation in the value of the building each year.
So we only save $4.2 million instead of $5.4 million.
That's still a big number.
I wonder who is putting up the money for the church to buy the school.
Seems someone or more have thier private agenda for selling the school.
Why doesn't that private school take the 1.25 million dollars and buy a building at actual cost? Then they don't have to worry about other opinions or any interference by any citizen or government agency what so ever.
I don't know, Pat, but I just can't make any sense out of selling a school when the other ones you have are too small and you are going to waste at least $4.2 million of taxpayer money.
What would help a lot would be if the superintendent would just sit down with a Roundup reporter and say in plain language why the school is being sold. There must be reasons. People are not stupid. They can understand them. So what are they?
Please notice that I put HUGE numbers in for the costs of closing and reopening the school. They assume the worst possible scenario (vandalism, storm damage, and/or illegal entry). $127,000 for closing the school and $160,000 for reopening it. What I actually thought those numbers would be is zero, but I bent over backwards to be fair.
If, as Pete put it in his original article, the only actual cost of keeping Frontier is the $38,000 to $50,000 cost of maintaining it each year (I used $44,000, an average), then the cost of waiting five years would be a mere $190,000 to $250,000, compared to the $6.8 million cost of rebuilding it at 2018 prices. (If they spend the $1.2 million they are going to get for Frontier then they have to pay ALL of the cost of replacing it, not the lower cost I calculated, subtracting the $1.2 million plus the interest it would draw over five years.)
I went to the website of the company that built Frontier and checked how the costs have risen over the years. They were very clear in their warnings that the prices shown for 1997 no longer apply. The cost of just one module that includes nothing but classrooms is now right at $1 million.
Plus which, the recession we had dropped the rate of inflation for several years. It is now back up to 3.2 percent instead of the 2.4 percent I used. And the original land bought for Frontier cost only $190,000 in the 90's. What would that same parcel of land cost today?
The real cost of replacing Frontier could easily run much higher than the VERY conservative numbers I used.
We need answers!
An e-mail that I received reminded me that I wanted to put up a site for you folks to go to in case you've never been inside Frontier. Just click on this site, click on each of the pictures to see what that place is like, and then ask yourself if we should sell it for less and a third of what it cost us.
Did you figure in the cost of land when they plan to build it? No one has said where.
With the other things they have done lateley, they probably never thought of that or maybe it will be out near Chaparral Pines and Rim Club. School for the elite?
There is no way, the tax paying citizens could rebuild that school for even, say 5 million bucks. Why wasn't a deal brokered that the school put down 1.5 mil then the school system "carry a loan" for say 3 million dollars, with interest over 30 years? Just one fair example, that would a good deal for all. Why hold closed door meetings? Unless, there was some unsavory agenda. Can't the current school board handle the Payson public? They don't want tax payer or citizen input? Would that have been to much to handle? Did anyone consider capping admin fees so as to ensure fair teacher compensation? Or, will this privately held "Christian" school just sell down the road, and the owners will make an amazing profit? How are the children of the tax paying parents that paid for this school going to benefit? WWJD? Is this really they way?
Everyone in town is all about the US Constitution when it comes to gun ownership, BUT, when it comes to separation of church and state, well that Amendment doesn't apply here.
"Christians" are supposed to follow the law of the land and role model that to the rest of the world, so when things like this happen it set precedence for all other religions to follow suit, and they will.
This situation is unjust and corrupt.
Since I moved from Payson to Oregon, I have no monetary interest in Payson issues. However, I can't help feeling disgust at the way the school issue is being managed. Since the property in question is being turned over to a religious entity, which is tax exempt, the district will lose any levy of property tax. I would urge the citizens of Payson to challenge the decision of the school board, and to replace the the board if it continues this giveaway of public property.
How about coming up with a rule that says, if the public funds improvements and the public holds the note, when the property is sold the funds go back to the public.
Is that too crazy a concept?
Is your problem selling the school or who it is being sold to?
Seems you don't want it to be a Christian school.
What or who would you suggest should have been the buyer?
I think it should been offered to ASU, but for a lot more $ if the story really exists that they are coming here. They bought a closed school at Lake Havasu City to start thier university there.
How would anyone know how to pay the money back to which tax payers?
I wasn't living here when the school was built. Would I get a few dollars?
The whole deal smells really bad to me.
Pat, I smell it too. That smell comes from the Government being in charge of education. It only became clear to me today why we have such an education problem in this country.
Question: If you were going to teach your children and there was no one else to do it, what would you teach them. Understand that their education would be totally up to you.
Would they be able to get along in todays world? Are You? This isn't a put down it's a reality check. Up until about 80 or so years ago the answer would have been yes. But the problem was turned over to the Government and a formula for education was developed consisting of basic information every child needed to know and the modern education was born.
The problem was they were wrong to develop it because it took the responsiblity for educating our children out of our hands and turned it over to the state. So I ask again,
If today you were responsible for teaching your child what he or she needs to know to survive in the modern world.....what would you teach them?
Nice idea. I'm for that. I'd be for it even if the money just went into a "tax reduction account" that was held for the next fiscal year
I'll be honest with you all: The only good thing I see about all this is that the facility will go to another school. At least it will be used for education.
But I can NOT make any sense out of the sale for so little of something that cost so much. It particularly bothers me that we have been given no cost estimates, or any other breakdown of numbers, in light of the Roundup editor's on-target comments in his original article, clearly showing that the cost of keeping the building would only run from $38,000 to $50,000 per year.
I'll just reverse the issue, making it a purchase instead of a sale so you can see how much sense those original comments make:
Suppose that instead of selling a school we were buying one. Suppose that the cost of buying a site, erecting the building, and equipping it came to $6 million. Suppose that we could pay for it at a cost of $50,000 each year for just 10 years.
Would we jump at the opportunity?
Then why, since it is dead certain that within 10 years we will need that school, are we selling it?
One last comment for Dan. Dan, this is a little off the subject for this string, but your questions bring up three very good questions: a. Why are our schools under fire? b. What, exactly, is wrong with them? c. Why do we need a program to "fix" them?
a. Our schools are under fire because the international test results have not been fully revealed to the American public, and Washington politicians are using misleading data to gain control of education.
b. There is nothing wrong with our schools which is not caused by interference by politicians. Our schools always have been, and are now, the best in the word.
c. The only program we need to "fix" our schools is the repeal of NCLB and all other programs, state or federal, like it.
Pat, the problem with selling / giving away this school at this price to any entity is that it is a rip off to this towns general population, children and the public schools that are here.
And yes, it is a bad idea to mix religion with the government. Separation protects Christianity and the second you have a religion take tax money, the government gets to move in. There is already a push to "tax churches" like business. This is exactly the kind of action that will allow the government to regulate religion. Super Bad Idea, to open this door.
I don't necessarily think there should be a buyer, because this town will grow and we should plan for SMART growth and what will benefit us in the future. we need to protect the assets that we have because we actually have little available land at our disposal for private use.
DON'T SELL OUT THE TOWN FOR CHUMP CHANGE!
you didn't answer my question. Selling the school or who it was being sold to?
If the school sale was refused because of religion, that would be a problem with govt. interfering with religion.
Pat, Are you really suggesting that it is now OK for all school boards to give away public school property, that was paid for by US tax payers, to religious institutions?
Can someone please show me the part of the Arizona Statutes or the US Constitution where it says closed door, sweetheart, back room deals or misappropriation is OK? Better ask yourselves what master is being served here. And, I am pretty sure, I read somewhere in some book that stealing is a sin. And, remember a little thing called Sharia Law and countries who have no separation, who we are supposedly in a holy war against? Because this is how "they" operate.
I didn't say it was all right to give the school to any one.
Your problem seems to be it is a Christian school.
Does the govt. control thier school and give them money now? They already have one on S. Colcord.
If PUSD was getting enough money out of the school to replace it in a few years I wouldn't care who they sold it to. It is the price and secrecy that has been going on.
One cost you all haven't brought up, is where are they going to store all the desks and everything they are taking out of the school when it is sold. That is going to take a really large storage area. If they have that much empty space, they shouldn't have to build another school bldg. in a few years. Where is the land to build another school? Does this all fall into the F.S. land that the SLE or whatever run by the town have anything to do with this?
Smells worse every day.
The thing about all this that troubles me is the feeling of helplessness. Payson, Arizona, is a small, rural town populated by people who take an interest in things, and yet I see very little control over what the school board does.
What does "control" mean?
It means having the people who work for you at least laying the facts on the table.
Pat, as to the equipment I am willing to bet it is going to go with the school. I could be wrong, of course, but I do not remember hearing anything about it, and so I suspect that's the way it is going to be.
Does anyone know for sure?
"The board voted to keep the details under wraps until the deal has completely closed. The $1.25 million value it had set on the school site, which has not been appraised." NOT APPRAISED?!! That's right, lets just pull a number out of a hat. Sounds like an informed, competent decision to me.
Who is doing the legal reviews of this contract?
"Payson Christian School Principal Patricia Fleeger happily admitted the PUSD board had agreed to its offer." (I bet.) "Fleeger said she’s excited about the purchase of the ready-to-go school site. “We do look for an increase in enrollment,” she said. “People from the Valley and California want more of what they are used to seeing,” YOU KNOW WHAT I WANT, BETTER SCHOOLS FOR THE CHILDREN, THAT ARE HERE AND NOW! "Fleeger said she anticipates the Christian school having its own facilities will make a difference." I BET IT WILL, AND YOU KNOW WHAT, IT WOULD MAKE A DIFFERENCE FOR THE PUBLIC SCHOOL KIDS, TOO!!!
"Fleeger also looks forward to hosting sporting events. We’ve always had to go away for our volleyball and basketball games, now we can host them at home,” she said.
SAY WHAT?! The board agreed to spend most of the money to expand the classroom capacity at Payson Elementary School (PES). Why the %$##^$ doesn't the board use Frontier for all day kindergarten? "All-day kindergarten is a hot button for board president Barbara Underwood. The board has included achieving that goal in its priorities for the year based on research showing it will likely boost test scores at PES and reduce the number of students held back because of poor reading skills."
"Fleeger said she does not anticipate renovating FES as the district made upgrades before the site was mothballed, including spending nearly $700,000 for upgrades from a still-not-paid-off bond issue." THE BOARD SOLD THE SCHOOL FOR 1.25 MIL AND STILL HAS TO PAY OFF $700, 000.00. SO, IN OTHER WORDS, THE SCHOOL WAS SOLD FOR $525,000.00 but just had $700, 000 worth of renovations. And it will cost AT LEAST $10 million to rebuild, and Payson is expecting 38 thousand residence, so we know we will definitely need this school. (CONTINUE TO NEXT POST.)
I THOUGHT THIS TOWN WAS AGAINST GOVERNMENT WASTE! ALL YOUR TAXES WILL GO UP TO REBUILD THAT NEW SCHOOL.
"Besides the added classrooms, Poore said PES staff has suggested building an auditorium for assemblies. Currently, PES uses its cafeteria, which can barely hold one grade level of students. Poore said the board must consider the future of the district and how to boost student achievement before breaking ground on any PES project." ARE YOU &$%&* KIDDING ME! Have assemblies at Frontier! Mrs. Poore, exactly how are you considering the future of the district? It sound like you need the room that we have already paid for NOW, for the current students.
DO YOU REPRESENT A SMALL GROUP OF ELITE, CHRISTIAN STUDENTS WHOS PARENTS CAN PAY PRIVATE TUITION OR DO YOU REPRESENT ALL OF PAYSON and THE DISTRICT?
Pat, you bet I have a problem that it is a Christian School. A Christian School today, then a Muslim School it will be somewhere else. HONOR THE CONSTITUTION!!! THIS DEAL NEEDS TO BE STOPPED IN ITS TRACKS. THIS IS COMPLETE INSANITY.
Governing Board and Superintendent. Core Values.
We believe and demonstrate the Six Pillars of Character:
Where are any of these values in play by selling Frontier Elementary?
And, if " Regular and Special Board meetings are open to the public." Then why did you close the public out and keep all the details secret?
III.) Per the Governing Board Minutes, of 19April, 2013. "(Read Prior to Executive Session) All persons present are hereby reminded that it is unlawful to disclose or otherwise divulge to any person who is not now present, other than a current member of the Board, anything that has transpired or has been discussed during this executive session. To do so is a violation of A.R.S. §38-431.03 A.2, A.3. unless pursuant to a specific statutory exception. "
IV.C.) "Consider Approval to Initiate a Capital Project at Payson Elementary Mr. Poer stated that the Superintendent expects the district to be proactive and predictive; therefore, the district has a plan for increasing capacity at Payson Elementary School. He presented several preliminary ideas developed by our architects as possibilities only. Mr. Huff made a motion to initiate a capital project at Payson Elementary; seconded by Mr. Wala; and carried unanimously. "
Do what you say Mr. Poer and board members, be proactive, use Frontier Elementary as the Public School IT IS, THAT WE THE CITIZENS PAID FOR, and then you don't need any capitol projects at PES and you won't have to build us another school in the future.
If the Muslims want to build a school I have no problem with it as long as they pay a fair price to contractors.
Freedom of Religion, remember. Govt. doesn't have the right to interfere. Try reading the first amendment to the Constitution.
Have you seen the sign across from the HS where the LDS Church is going to build a Seminary bldg? Got a problem with that too Robbin?
Pat, I have slightly calmed down and I am sorry for being so harsh. I do realize that the school board members are most likely well meaning, I do not know any of them. I am new this blogging thing and I will try to be more diplomatic. I have absolutely no problem with a private Muslim, Hindu, Buddhist, Jewish, Catholic, or any other of the thousand faiths on the planet having a private school here in Payson or anywhere.
That private religious school, needs to buy the land, build a structure, provide teachers, feed the children, provide transportation, etc., at their own expense. And, your right, the government doesn't have the right to interfere, but should the government (tax dollars) pay for that school with a private agenda? Or should we follow the Arizona Constitution, Section 9. Sale or lease; conditions; limitations;
"All lands expressly transferred and confirmed to the state, by the provisions of the Enabling Act approved June 20, 1910, including all lands granted to the state, and all lands heretofore granted to the territory of Arizona, and all lands otherwise acquired by the state, may be sold or leased by the state in the manner, and on the conditions, and with the limitations, prescribed by the said Enabling Act and this Constitution, and as may be further prescribed by law; Provided, that the legislature shall provide for the prescribed by title 65, Civil Code of Arizona, 1901, and in such cases only as permit reimbursements to lessees in said title 65."
Separate appraisement, means that if the board is going to sell the school that they need now for the public school students here, they should get an appraisal, which of course should include the cost of rebuilding the school which they need now (which makes no since) or maybe the private school should build their own school at their own expense. And I'm not really sure how the sell of the school could possibly "reimburse to the actual bona fide residents" the tax payers, and the current and future public school students for the loss of this school to the general Payson population.
This kind of shenanigans is what bankrupted the California School system. And it will end up with shady bond initiatives in our future if we take this path.
I would love for the public school system in Payson to be excellent! But that will never happen if we strip the minute resources available from them. The town consists of poor Christians as well as wealthy. Who did Jesus serve?
Pat, ignore the last "blog," I flagged it for removal and quoted the wrong area of the law. Per the Arizona State Legislature: Article 10, Section 4. Sale or other disposal; appraisal; minimum price; credit; passing of title
"Section 4. All lands, lease-holds, timber, and other products of land, before being offered, shall be appraised at their true value, and no sale or other disposal thereof shall be made for a consideration less than the value so ascertained, nor in any case less than the minimum price hereinafter fixed, nor upon credit unless accompanied by ample security, and the legal title shall not be deemed to have passed until the consideration shall have been paid.
I have absolutely no problem with a private Muslim, Hindu, Buddhist, Jewish, Catholic, or any other of the thousand faiths on the planet having a private school here in Payson or anywhere. However, that private religious school, needs to buy the land, build a structure, provide teachers, feed the children, provide transportation, pay property taxes, etc., at their own expense. And, your right, the government doesn't have the right to interfere, but why should the government (tax dollars) pay for any religious school with a private agenda? Private is private, Public is public.
We should follow the Arizona Constitution, Section 9. Sale or lease; conditions; limitations; which includes:
A separate appraisement requirement, which means that if the board is going to sell Frontier Elementary School (that the public school kids need now, for the public school students here), the Board must get a independent appraisal, which of course should include the cost of rebuilding the school. Or maybe the private school should build their own school at their own expense.
Another provision is to "reimburse to the actual bona fide residents" the tax payers, and the current and future public school students for the loss of this school to the general Payson population. And I'm not really sure how the sell of the school could possibly accomplish this.
This kind of shenanigans is what bankrupted the California School system. And it will end up with expensive bond initiatives to rebuild another school to the citizens of Payson in our future if we take this path.
I would love for the public school system in Payson to be excellent! But that will never happen if we strip the minute resources available from them. The town consists of poor people as well as wealthy. Who did Jesus serve?
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