School sale proceeds may have to stay in trust

Thursday, October 18, 2007

Money from the sale of the aging Schultz school building may not be available for use in relocating the Alternative Education Center.

The Cape Girardeau school board agreed in February to sell the property to Jackson developer Chad Hartle for $1.7 million. The sale is expected to be finalized in January; Hartle is waiting to receive state tax credits.

The board expected to be able to use the money from the sale to renovate available space in the district's administration building for the center's use. But board members recently discovered that the money must go into a permanent trust, meaning the district can only spend money earned from interest.

The judgment comes from a 2002 lawsuit the district filed to get a clear title to the land. According to board member Paul Nenninger, the land was a gift from Don Louis Lorimier to be used exclusively for public education, so the suit was necessary to void that condition.

At the school board meeting Monday night, board member Tom Reinagel said the news was the "first I've heard of that." "This changes my light on the project entirely," he said.

Superintendent Dr. David Scala said that while the money must be put into a trust, other money would be freed for use in the project. He also indicated that the district's attorney would come to the next board meeting to discuss the issue.

"As long as that amount of money is kept in reserve, we can use an amount equal to that total for other projects," Scala said.

But Reinagel argued that the money must always be held in the trust, which is not equivalent to having an equal amount to spend.

"That does not tell me I have $1.7 million to spend on this," he said.

He also expressed concern about the proposal for the Alternative Education Center ballooning from 14,000 to 18,000 square feet. Two additional classrooms, a larger multipurpose center and an expanded front entryway account for the increase, architect Phillip Smith said Wednesday.

Smith estimated in July that the project would cost between $1.1 million and $1.35 million to build. He says now the figure will be more like $1.7 million based on square footage cost estimates.

"I think we need to come back to the drawing board and pull the reins in," said Patrick Morgan, the director of administrative services, emphasizing that the plans are not finalized.

That could entail cutting back on classrooms or reusing more of the existing building. In the current plan, about 16,400 square feet of existing space would be used, requiring 1,600 square feet of new construction.

Smith has also developed a future plan with four more classrooms to accommodate for growth. The school currently serves 94 "at-risk" students in grades seven through 12, but administration is discussing expanding the school to include fifth- and sixth-graders.

Morgan hopes the district can begin sending out bids for construction in December.

335-6611, extension 123

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